Francisco Baguio v RP, GR No. 119682, January 21, 1999 (301 SCRA 450)

"Free Patent"

Facts:

William Michael filed with the Bureau of Lands an application for foreshore lease of a public land. The application was recommended for approval by the land investigator who also recommended that the applicant be granted a provisional permit to occupy the land for one year. By virtue of the permit, Michael made reclamation of the land introducing improvements therein. Upon the expiration of the permit the Highways District Engineer recommended to the Director of Lands that the land be leased to Michael. On the other hand, the land investigator recommended granting Michael the authority to survey the foreshore land in view of the completion of the reclamation made by him on the premises. On February 25, 1968, Michael filed a miscellaneous sales application covering the reclaimed foreshore land. On the other hand, petitioner Baguio applied to the Bureau of Lands for a free patent over the same land stating that the land was agricultural and he has been in actual and continuous possession of the same. A free patent was issued in Baguio’s favor by the Register of Deeds of Cebu. The petitioner now demands rental payment from Michael for using the land occupied by Michael Slipways, Inc. and filed an opposition to Michael’s miscellaneous sales application on the said land. In turn, Michael filed a protest on the issuance of the free patent to Baguio by the Bureau of Lands since he is the actual possessor of the land since 1963 and introduced substantial improvement thereon.

Upon recommendation of the Land Management Bureau of the Department of Environment and Natural Resources, the government filed a petition for the cancellation of the patent and reversion of land to the public domain. Ricardo Michael was allowed to intervene as heir and successor-in-interest of William Michael. The trial court cancelled the free patent of Baguio and ordered the reversion of the land to public domain. It ruled that the false statement that Baguio made in his application for free patent had the effects of ipso facto canceling the free patent granted to him. On appeal, petitioner assails the court decision of cancelling his patent since the action has already prescribed and that it erred in ruling that he acted in bad faith and procured the registration of his free patent through fraud and misrepresentation.

Issue:

Whether or not the free patent of the petitioner may be cancelled?

Ruling:

The Supreme Court that while a Torrens Title becomes indefeasible within 1 year after its registration the State may still bring action for reversion of a parcel of land to the public domain covered by a Torrens title obtained through fraud because such action is not barred by prescription as provided by Commonwealth 141. Public policy demands that one who obtains title from a public land through fraud should not be allowed to benefit from it. The declaration of the petitioner in his application for patent under oath that the land is an agricultural land not claimed or occupied by another person, that he is in actual and continuous possession of the land constitute fraud and misrepresentation. Records show 13 years before the alleged occupation of the petitioner to the land, Michael already filed a foreshore lease application over the same and since then it was Michael who was in actual possession of said land by operating a dry docking service and made some improvements thereon. It was also established that the land in dispute is a foreshore land and not agricultural. The false statement made by petitioner in his application justifies the immediate cancellation of his title. The indefeasibility principle of Torrens System does not apply on titles secured by fraud and misrepresentation. The registration of a patent under the Torrens System merely confirms the registrant’s title. It does not vest title where there is none because registration under this system is not a mode of acquiring ownership.

Michael has been in possession of the land by virtue of provisional permit granted to him to occupy the same 13 years before the petitioner filed his application for a free patent and Michael filed a sales application over the land 8 years prior to the petitioner’s application. Thus, it was correct for the court to rule that William Michael and his successor-in-interest Ricardo Michael as the true and rightful possessor of the land. Sec. 105 of the Public Land Act provides that in case of death of the original applicant he can be succeeded in his rights and obligations by his legal heirs with respect to the land applied for or leased therefore Ricardo Michael is entitled to the possession of the land as contrary to what the petitioner asserts.