G.R. No. 123924 - Heirs of Franco vs. Court of Appeals

The petitioners are the heirs of Miguel Franco, while the respondents are the heirs of Faustina Cabading.
The subject property is a parcel of public land located at Lianib, Dipolog, Zamboanga del Norte, originally surveyed as Lot No. 5172 (Cad. 85 Ext.) and covered by Original Certificate of Title No. P-436 issued in Quintin Franco’s name on July 9, 1954.

Quintin Franco, the patentee of the subject property, died intestate on December 8, 1967.
Miguel Franco, Quintin’s brother, filed a petition for the issuance of Letters of Administration on October 17, 1968, before the Regional Trial Court (RTC) of Dipolog City, Branch 7.
Faustina Franco Vda. de Cabading, the decedent’s sister, opposed Miguel’s petition and sought her own appointment as administratrix.
The intestate court eventually appointed Miguel as the special administrator on December 3, 1969, but later, on August 27, 1973, it issued an order declaring Quintin the absolute owner of the subject property and subsequently removed Miguel as special administrator on September 1, 1973.

Miguel later asserted that one-half of the subject property had been transferred to him through a document titled “General Power of Administration” executed by Quintin in 1967.
Acting on this claim, Miguel filed a petition before Branch 1 of the Dipolog RTC on January 2, 1973 (Misc. Sp. No. 2993), seeking the cancellation of OCT No. P-436 and the issuance of a separate Transfer Certificate of Title (TCT).
The petition granted on January 6, 1973, resulted in the issuance of TCT No. T-20203 in Miguel’s name covering half of the subject property, which was formally issued on February 13, 1973.

Shortly thereafter, the other heirs moved for the cancellation of TCT No. T-20203.
On May 4, 1977, the intestate court ordered the cancellation of TCT No. T-20203, ruling Miguel’s acquisition as fraudulent.
The Court of Appeals reversed this cancellation order on October 6, 1995, thereby ordering the cancellation of the TCT and directing the issuance of a new title in favor of the heirs of Quintin Franco.

In his petition for Letters of Administration, Miguel admitted under oath that the entire subject property belonged to Quintin, without any indication of claiming co-ownership at that time.
This admission, coupled with his prolonged silence (approximately 19 years) on his claim to half of the property, served as a declaration against interest and a judicial admission.
The evidence raised issues regarding the validity of the “General Power of Administration” as a basis for transferring ownership and whether it sufficed to create a trust relationship under Article 1452 of the Civil Code.

Under the Torrens system, OCT No. P-436, registered on July 9, 1954 in Quintin’s name, stands as strong evidence of ownership.
The expedited judicial proceedings under Section 112 of the old Land Registration Act—which are meant for non-controversial, clerical corrections—were controversially used to register half of the property in Miguel’s name.
The lack of unanimity among all heirs regarding this registration and the adverse claim by other heirs further complicated the legitimacy of the TCT issued to Miguel.

Whether Miguel’s earlier judicial admission—stating that Quintin was the absolute owner of the subject property—negates his later claim of co-ownership based on the “General Power of Administration.”
Whether the belated assertion of ownership constitutes a declaration against interest that should be given full evidentiary value.

Whether the issuance of TCT No. T-20203 in favor of Miguel Franco was procedurally and substantively valid considering the application of Section 112 of the old Land Registration Act.
Whether the expedited process (from petition to order in just four days) reflects a surreptitious and possibly fraudulent maneuver intended to disadvantage the other heirs.

Whether the document entitled “General Power of Administration” can create a trust relation that confers co-ownership rights upon Miguel, given that Quintin acquired the subject property individually through a patent.
Whether the trust doctrine under Article 1452 applies in the absence of a joint purchase or mutual agreement among co-owners.

Whether the principle of indefeasibility inherent in the Torrens system (embodied in the registered OCT) should override Miguel’s claim to half the property.
Whether the requirements and limitations of Section 112 allow for the cancellation and separate registration despite serious objections and controversy among the parties.