Equitable title

An action for quieting of title is a remedy to determine the respective rights of conflicting claimants to a parcel of land so that every cloud of doubt over the property will be removed and that the one who has no right over it will be prevented from disturbing the real owner. What are the requisites for an action to quiet title? This is the issue answered in this case.

This case involves three parcels of agricultural land owned by Cely and her late husband Rudy. About 21 years ago, Cely sold said land to her nephew, Jimmy, through a Deed of Absolute Sale. Since Jimmy resided in Manila, he placed one parcel with an area of 3,495 square meters in the care of his brother Berto and his nephew Leo, the son of Berto, on the condition that Berto and Leo would religiously deliver the produce of said land.

Unfortunately, however, after 11 years of possession, Berto and Leo failed and continuously refused to deliver the produce of the land and to vacate the same despite Jimmy’s demands. So Jimmy filed an action against Berto and Leo for quieting of title, recovery of possession, rendition of accounting and damages.

In their defense, Berto himself admitted that their late Auntie Cely and Uncle Rudy owned the land and he paid the taxes in their behalf. But he claimed that he and his son Leo have been in open, continuous, peaceful, adverse and uninterrupted possession of subject land in the concept of owner, where their residential house was erected almost 50 years ago. Thus, Jimmy’s action was already barred by prescription or laches, they contended.

They further claimed that the fact that they gave Jimmy portions of the land’s produce was merely in keeping with the Filipino culture of sharing blessings with siblings and relatives. They also argued that the deed of absolute sale presented by Jimmy is not the legal or beneficial title contemplated in the law for quieting of title under Article 476 of the Civil Code.

After trial, the Regional Trial Court (RTC) rendered judgment declaring Jimmy as the owner of the subject land and directed Berto and Leo to immediately relinquish and surrender possession thereof to Jimmy. It ruled that Jimmy had a better right over the land as proven by the deed of absolute sale executed in his favor which was notarized, and therefore enjoyed the presumption of regularity, while Berto and Leo’s possession is not in the concept of an owner.

On appeal by Berto and Leo, the Court of Appeals (CA) reversed the RTC decision and ruled that the notarized deed of sale executed in Jimmy’s favor did not transfer the land’s ownership to him, given that he was never placed in possession and control thereof. Moreover, the CA debunked Jimmy’s claim that he is a buyer in good faith since the subject land was not in the possession of Cely and he failed to prove and clarify the true nature of Cely’s possession.

Was the CA correct?

The Supreme Court said that contrary to the position taken by the CA, it finds that Jimmy satisfactorily established his equitable title over the subject land and the removal of cloud of doubt thereon, particularly the claim of Berto and Leo that they are the owners thereof. Equitable title is the title derived through a valid contract or relation and based on recognized equitable principles and the right of the party to whom it belongs, to have the legal title transferred to him.

An action for quieting of title is essentially a common law remedy grounded on equity. The competent court is tasked to determine the respective rights of the complainants, not only to place things in their proper place, to make the one who has no rights to said immovable respect and not disturb the other, but also for the benefit of both, so that he who has the right would see every cloud of doubt over the property dissipated, and he could afterwards without fear introduce the improvements he may desire, to use and even to abuse the property as he deems best.

But “for an action to quiet title to prosper, two indispensable requisites must concur, namely: (1) the plaintiff or complainant has a legal or an equitable title to or interest in the real property subject of the action and (2) the deed, claim, encumbrance or proceeding claimed to be casting cloud on his title must be shown to be in fact invalid or inoperative despite its prima facie appearance of validity or legal efficacy.”

In this case, Jimmy’s title to the subject land was derived through a deed of sale as evidenced by a notarized document whereby Cely the widow of Rudy transferred the subject land and two other parcels to Jimmy. Cely’s right to transfer the land to Jimmy was clearly established during the trial as Berto himself admitted. The execution of the notarized deed of absolute sale constitutes constructive delivery as to effect the transfer of ownership from the seller to the buyer (Article 1498 of the Civil Code).

In this case, Jimmy exercised possession of said land through Berto and eventually his son Leo, whom he allowed to stay and care for the land in exchange for the delivery of the produce thereof. The fact that Berto delivered the produce of the land to Jimmy was also admitted by Berto. So the action for quieting of title should prosper to benefit the heirs of Jimmy, who already died. (Heirs of Extremadura etc. vs. Extremadura etc., G.R. 211065, June 15, 2016)

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