G.R. No. L-7745 - Sevilla vs. De Los Angeles

On August 21, 1951, the plaintiffs, who are the legitimate children of Felix Sevilla and Ciriaca Ramos, filed an action in the Court of First Instance of Camarines Sur.
They sought both the recovery of a parcel of land measuring 41 hectares, 14 ares, and 92 centares and the cancellation of Transfer Certificate of Title No. 577, which was allegedly procured through fraudulent representation by the defendant.

Defendant answered the complaint on December 21, 1951, setting up several affirmative defenses.
On August 20, 1952, the defendant filed a motion to dismiss, arguing that either the complaint stated no cause of action or that the action was barred by prescription.
Although plaintiffs objected, the court initially denied the motion to dismiss.
Later, when the defendant refiled a second motion to dismiss based on the plea that the action had prescribed, the court, in an order dated October 20, 1953, reconsidered its earlier ruling and ultimately dismissed the case on the ground of prescription.

The background of the dispute reveals that the plaintiffs’ parents applied for a homestead in Siruma, Camarines Sur from the Bureau of Lands.
Before the issuance of the patent, Ciriaca Ramos died; however, her husband, Felix Sevilla, continued pursuing the homestead.
On April 27, 1934, the patent was granted, and the Original Certificate of Title No. 1056 was issued in the name of the “heirs of Felix Sevilla” (the minor plaintiffs).
Subsequent to the patent’s issuance, Felix Sevilla remarried, choosing the defendant as his wife.
Shortly thereafter, following Sevilla’s death, the defendant, either by fraudulent misrepresentation or by falsely claiming to be the sole heir, succeeded in having the Original Certificate of Title No. 1056 cancelled and a new Transfer Certificate of Title No. 577 issued in her name.
As a result of this fraudulent act, the defendant gained possession of the land and appropriated its produce from 1936 until the filing of the present action.

The record indicates that the defendant’s fraudulent act, which led to the issuance of Certificate of Title No. 577, occurred in 1936.
The public nature of the Register of Deeds ensures that this certificate is open to inspection, thereby giving the plaintiffs constructive notice of the fraud from the date of issuance.
The court noted that this constructive notice, available to any interested party, could have prompted appropriate action much earlier, hence suggesting that the action was barred by prescription under ordinary circumstances.

The case also involves the allegation that the defendant’s acquisition of the title, though tainted by fraud, constitutes the creation of a “constructive trust” in favor of the plaintiffs.
This constructive trust argument implies that even if the public record gives constructive notice, the equitable remedy of compelling a trustee to convey the property should not be barred by prescription.
The situation is distinguished from ordinary actions for recovery of real property, as the present case involves compelling a fiduciary duty for proper conveyance of trust property.

Whether the action should be dismissed on the ground that it is barred by prescription, given that the fraud was instituted in 1936 and the suit was initiated only in 1951.
Whether the plaintiffs had constructive notice of the fraud from the issuance of Certificate of Title No. 577 and if such notice makes the recovery action time-barred.

Whether the doctrine of prescription under the Torrens system, which generally applies to ordinary recovery actions, is applicable when the remedy sought is for specific performance or to compel a trustee to convey property held in trust.
Whether the fraud that induced the cancellation of the original title and the issuance of the new title constitutes an equitable wrong that should preclude the application of prescription.

Whether the action, being essentially one to enforce a fiduciary or trust relationship (thereby seeking the specific conveyance of property held in trust), falls outside the ambit of actions prescribed by the statute of limitations.
The extent to which precedent cases (e.g., Feliciano Manalang vs. Garcia Canlas, Cristobal vs. Gomez, and Castro vs. Castro) influence the determination regarding prescription in trust or equitable contexts.