G.R. No. 167390 - Spouses Ferdez vs. Spouses Co

The property in dispute is identified as Lot 978, Cad. 439-D, covering 1,209 square meters, located in Nalsian, Calasiao, Pangasinan.
Respondents’ predecessor-in-interest, Emilio Torres, married to Pilar Torres, was granted a free patent on June 10, 1996, issued by President Fidel V. Ramos, which was later registered and evidenced by Katibayan ng Orihinal na Titulo Blg. P-35620.
An adverse claim affidavit was filed by petitioner Adolfo Fernandez on July 16, 1996, and annotated on Emilio Torres’ title, but was subsequently cancelled by an affidavit (dated March 20, 1996) in which Fernandez acknowledged that Emilio Torres was the true owner and in actual possession of the property.

Following the cancellation of the adverse claim, Emilio Torres executed an Affidavit of Request for the Issuance of a New Transfer Certificate of Title on September 20, 1996.
As a result, the Register of Deeds cancelled the original Katibayan and issued Transfer Certificate of Title (TCT) No. 216709 in Emilio Torres’ name.
On June 6, 1997, spouses Emilio and Pilar Torres sold the property to respondents, Martines and Erlinda Co.
Post-sale, TCT No. T-216709 was cancelled and replaced with TCT No. T-236032 in the name of respondents, who then took physical possession of the property by erecting concrete posts and a barbed wire fence.

On September 3, 2001, petitioner Adolfo Fernandez disturbed the possession by destroying the fence and commencing construction, prompting respondents to file a Complaint for forcible entry/ejectment.
Petitioners, in their answer and subsequent pleadings, claimed that they had long been in actual possession of Lot 978, alleging that it originally formed part of a larger unirrigated riceland (Cadastral Lot No. 661) which they owned.
They further asserted that the free patent issued to Emilio Torres was fraudulently executed and that the property, being private land, could not be subjected to a free patent.

The Municipal Trial Court (MTC) of Calasiao, Pangasinan, ruled in favor of respondents, ordering petitioners to vacate Lot 978 and awarding rental, moral, and exemplary damages, while emphasizing that the evidence confirmed respondents’ continuous and actual physical possession.
On appeal, the RTC of Dagupan City, Branch 44, reversed the MTC decision, declaring the title of respondents void on two grounds: (a) the property was private unirrigated riceland and not subject to free patent, and (b) the disposition of the property fell within a prohibitory period.
Respondents then appealed to the Court of Appeals, which reversed the RTC’s ruling, reinstated the MTC decision (with the modification of deleting awards for moral and exemplary damages due to lack of legal basis), and affirmed that respondents were entitled to possession.

The evidence showed that respondents and their predecessors had continuous, actual, physical possession of the property as registered owners.
A key element was the affidavit of petitioner Adolfo Fernandez, in which he admitted that Emilio Torres was the actual possessor and owner, thereby undermining his adverse claim.
Procedural contentions included allegations that the Court of Appeals failed to address the validity of respondents’ title and that technical defects regarding pending actions and submissions should have led to a dismissal.
The Court of Appeals, however, held that ejectment cases concern de facto possession independently of title challenges, and that any issues regarding title must be raised in a separate suit.

Whether the dispute should be resolved based solely on the party in actual, continuous possession of the property, or if the validity of the title (ownership) should be directly examined.
The issue centers on whether petitioners’ claim based on prior possession and adverse claim is sufficient to invalidate respondents’ possession.

Whether petitioner Adolfo Fernandez’s affidavit and subsequent cancellation of his adverse claim, which admitted Emilio Torres as the true owner, precludes petitioners from asserting earlier possession.
The legal effect of the cancelled adverse claim on petitioners’ rights to the property.

Whether the Court of Appeals erred by not inquiring into the validity of respondents’ title when the possession claim is anchored on alleged ownership.
Whether the court properly addressed the procedural submissions and technical allegations regarding forum shopping and the submission for decision.