G.R. No. 173211 - Heirs of Spouses Intac vs. Court of Appeals

Two separate petitions for review were filed challenging the decision of the Court of Appeals dated April 29, 1998 in Civil Case No. Q-93-18569.
The cases originated from complaints filed in early 1993:

On January 20, 1993, Pedro Destura initiated a complaint against Jorge H. Chin and Renato B. Mallari for annulment of title, reconveyance, specific performance, damages, and nullification of a Memorandum of Agreement (MOA) dated March 26, 1992.
On December 9, 1993, Maria Destura filed a substantially similar complaint against the same private respondents, later consolidating issues with her husband’s earlier action.

The MOA involved an agreement among Chin, Mallari, Pedro Destura, and a broker (Jaime B. Lumasag, Jr.) to sell the property and share its proceeds; the prospective buyer eventually backed out, and the sale did not materialize.

The Regional Trial Court dismissed the complaint filed by Pedro Destura for lack of cause of action, and subsequently issued an order on January 24, 1995 by default:

Nullified the MOA.
Ordered the cancellation of Transfer Certificates of Title (TCT) Nos. 52928 and 52929 in favor of Chin and Mallari.
Instructed the reinstatement of TCT No. 36048 in the names of the Pael family (Antonio Pael, Andrea Alcantara, and Crisanto Pael), despite the Paels being non-parties to the action.

Maria Destura, though initially the plaintiff, dropped her husband as a party defendant by claiming an amicable settlement, yet her complaint proceeded and later she attempted to intervene at advanced stages of the appellate proceedings.

In the appeal filed by Pedro Destura from the dismissal of his complaint, the Court of Appeals:

Affirmed the trial court’s dismissal for lack of cause of action.
Declared the MOA valid and held that Chin and Mallari possessed a better title to the property.

A Motion for New Trial and a supplemental pleading by respondents’ former counsel, Atty. Oliver O. Lozano, asserting that their failure to answer was due to an “honest mistake” and claiming the existence of a valid defense.
The trial court denied various motions (for new trial, supplemental motion, omnibus motion) and declared the decision on January 24, 1995 as final and executory.

Controversies arose concerning the reinstatement of the Paels’ title despite their non-participation, as well as conflicting manifestations from Roberto Pael (administrator of the Pael Estate) regarding the withdrawal of the petition for review.
Additional interventions and motions by third parties such as Luis M. Menor, Letty Sy, and even a petition-in-intervention by PFINA Properties, Inc. complicated the proceedings—including the issuance of a dubious new title, TCT No. 186662, to PFINA.
The appellate court eventually annulled the trial court’s decision for awarding title to non-parties and for the procedural anomalies, and ruled:

Declaring the MOA valid.
Declaring void the cancellation of TCT Nos. 52928 and 52929, ordering their reinstatement in favor of Chin and Mallari.
Directing the Register of Deeds to surrender or cancel the owner’s duplicate of TCT No. 36048.
Denying the interventions and motions for damages.

The petitions consolidated in G.R. Nos. 133547 and 133843 raised issues on extrinsic fraud, default judgment, and the propriety of awarding title to non-parties.
A significant issue was whether Roberto Pael’s withdrawal of the petition for review was voluntary and sufficiently informed, considering conflicting manifestations and the roles of court officials in solemnizing his documents.
The Supreme Court discussed the procedural posture of the case in light of the appearance of extrinsic fraud committed by respondents’ counsel, the error in reinstating the Paels’ title, and the contradictory appellate decisions.
Ultimately, the petition for review was denied, with modified relief ordering the cancellation of TCT No. 186662 and the reinstatement of the titles in favor of Chin and Mallari.

Whether extrinsic fraud occurred through the acts and negligence of Atty. Oliver Lozano, which resulted in a default judgment denying the respondents their right to present a full defense.
Whether the trial court’s decision ordering the cancellation of titles held by Chin and Mallari and the reinstatement of TCT No. 36048 in the names of the non-parties (the Paels) was valid and legally sustainable.
Whether the subsequent withdrawal of the petition for review by Roberto Pael, administered in conflicting manifestations, was voluntary, knowing, and legally effective.
Whether the claims of litis pendentia and res judicata apply, particularly in light of the separate but substantially identical actions filed by Pedro Destura and Maria Destura.
Whether the issuance of a new title (TCT No. 186662) by PFINA Properties, Inc.—amidst a pending litigation and allegations of wrongdoing by the Register of Deeds—affects the chain of title and the rights of the parties.