G.R. No. L-40402 - Republic vs. Court of Appeals

This case is a petition for review on certiorari filed by the Republic of the Philippines challenging the decision of the Court of Appeals and, ultimately, the lower court’s ruling in a cadastral proceeding.
The controversy centers on Lot No. 622 of the Mariveles Cadastre, which was declared public land in a decision rendered before the last war in Cadastral Case No. 19, LRC Cadastral Record No. 1097.

On July 6, 1965, Lot No. 622 was segregated from the forest zone and released as agricultural land for disposition under the Public Land Act by the Bureau of Forestry.
On April 26, 1967, the private respondents filed a petition in the Court of First Instance of Bataan to reopen the cadastral case, asserting that they had acquired ownership through purchase from the original owners and had occupied the property continuously, openly, exclusively, publicly, and adversely for more than 30 years.
The petition included specific identification and delineation of various lots (including parts of Lot No. 622 and Lot No. 324) as indicated in the approved segregation plans.
An order was subsequently issued on May 17, 1967, setting the petition for hearing and directing that the Republic’s representatives (the Solicitor-General, the Director of Lands, and the Director of Forestry) be notified.

On August 24, 1967, the Director of Forestry initially opposed the petition on the ground that the area was still within the timberland and therefore inalienable; however, after verifying that the disputed area was actually released as agricultural land, he withdrew his opposition.
On September 1, 1967, the Acting Provincial Fiscal of Bataan, representing the Director of Lands, opposed the petition, arguing that the land remained public and was not subject to registration under Act 496.
The lower court, finding that the petitioners had complied with the necessary requirements, rendered a decision on December 17, 1968. This decision approved the segregation plans and adjudicated in favor of the private respondents, directing the issuance of decrees of registration.
The Commissioner of Land Registration issued Decrees Nos. N-124813 to N-124818 on May 7, 1969.

On May 7, 1979, the Republic (petitioner) filed a petition for review of the decrees of registration on several grounds:

Lack of proper notice to the Solicitor-General regarding subsequent hearings in the reopened cadastral proceeding.
The status of the parcels as public land, notwithstanding their release as agricultural land on July 6, 1965.
The allegation that the lower court lacked jurisdiction to grant a title under Section 48(b) of Commonwealth Act No. 141.
Alleged fraud in the procurement of titles, notably through simulated deeds of sale to third parties.

The trial court did not have jurisdiction over the nature of the suit.
No fraud existed that would justify setting aside the decrees of registration, noting that any alleged defect was due to the delegation of notice to the Provincial Fiscal and that the petition was untimely.

Shortly thereafter, respondents filed an answer reiterating their motion-to-dismiss grounds, and further pleadings, including an amended Petition for Review by the petitioner on November 12, 1970, and respective reply briefs, were filed leading up to the final review.

Error in determining that the private respondents’ possession of the lots was only effective as of July 6, 1965—thus failing to meet the statutory 30-year requirement for acquisition of title under the Public Land Act.
Failure by the lower court to take into account that the Solicitor-General was not properly notified of all proceedings (beyond the initial notice when service was delegated to the Provincial Fiscal).
The alleged transfer of the lots by private respondents to third parties, even while their titles were still under review, rendered the transaction fraudulent and in bad faith.

Whether or not the private respondents can be deemed to have satisfied the mandatory 30-year period of possession required for a judicial confirmation of title under Section 48(b) of Commonwealth Act No. 141, given that the land was only released as agricultural land on July 6, 1965.
Whether counting possession from before the release (as forest land) conflicts with the statutory requirement for agricultural land.

Whether the failure to directly notify the Solicitor-General (by replacing such notice with the notification to the Provincial Fiscal) constituted a fatal procedural error that invalidated the proceedings to reopen the cadastral case.
Whether such procedural irregularity deprived the government of its right to be heard.

Whether the transfer of the lots to third parties during the review period, despite the pending nature of the registrations, amounted to actual fraud.
Whether the alleged fraud was sufficient to affect the validity of the titles issued under the decrees of registration.