1 San Roque Realty Devt V Republic

6/3/2020 SUPREME COURT REPORTS ANNOTATED VOLUME 532
VOL. 532, SEPTEMBER 7, 2007 493

San Roque Realty and Development Corporation vs.
Republic
*
G.R. No. 163130. September 7, 2007.
SAN ROQUE REALTY AND DEVELOPMENT

CORPORATION, petitioner, vs. REPUBLIC OF THE
PHILIPPINES (through the Armed Forces of the
Philippines), respondent.
Eminent Domain; Time and again, the Court has declared

that eminent domain cases are to be strictly construed against the
expropriator.—Time and again, we have declared that eminent
domain cases are to be strictly construed against the expropriator.
The payment of just compensation for private property taken for
public use is an indispensable requisite for the exercise of the
State’s sovereign power of eminent domain. Failure to observe
this requirement renders the taking ineffectual, notwithstanding
the avowed public purpose. To disregard this limitation on the
exercise of governmental power to expropriate is to ride
roughshod over private rights.
Same; If the Republic had actually made full payment of just

compensation, in the ordinary course of things, it would have led
to the cancellation of title, or at least, the annotation of the lien in
favor of the government on the certificate of title covering the lot.—
From the records of this case and our previous findings in the
related cases, the Republic manifestly failed to present clear and
convincing evidence of full payment of just compensation and
receipt thereof by the property owners. Notably, the CFI Decision
in Civil Case No. 781 makes no mention of the initial deposit
allegedly made by the Republic. Furthermore, based on the CFI
Decision fixing the amount of just compensation for some of the
lots, the initial deposit, if it was indeed disbursed, would still not
adequately recompense all the owners of the 18 expropriated lots.
More importantly, if the Republic had actually made full payment
of just compensation, in the ordinary course of things, it would
have led to the cancellation of title, or at least, the annotation of
the lien in favor of the government on the certificate of title
covering Lot No. 933.
central.com.ph/sfsreader/session/000001727a23add5525658be003600fb002c009e/t/?o=False 1/24
Same; Laches; Torrens System; While the general rule is that

the State cannot be put in estoppel or laches by the mistakes or
errors of its officials or agents, this rule, however, admits of
exceptions, one
_______________
* THIRD DIVISION.
494
494 SUPREME COURT REPORTS ANNOTATED
San Roque Realty and Development Corporation vs. Republic
of which is when the strict application of the rule will defeat the
effectiveness of a policy adopted to protect the public such as the
Torrens system.—Laches is the failure or neglect, for an
unreasonable and unexplained length of time, to do that which by
exercising due diligence could or should have been done earlier; it
is negligence or omission to assert a right within a reasonable
time, warranting a presumption that the party entitled to assert
it either has abandoned it or declined to assert it. The general
rule is that the State cannot be put in estoppel or laches by the
mistakes or errors of its officials or agents. This rule, however,
admits of exceptions. One exception is when the strict application
of the rule will defeat the effectiveness of a policy adopted to
protect the public such as the Torrens system.
Innocent Purchasers for Value; Words and Phrases; An

innocent purchaser for value is one who, relying on the certificate
of title, bought the property from the registered owner, without
notice that some other person has a right to, or interest in, such
property, and pays a full and fair price for the same, at the time of
such purchase, or before he has notice of the claim or interest of
some other person in the property.—The trial court correctly held
that title registered under the Torrens system is notice to the
world. Every person dealing with registered land may safely rely
on the correctness of its certificate of title and the law will not
oblige him to go beyond what appears on the face thereof to
determine the condition of the property. The conveyance history of
the subject properties is clearly shown on the titles of SRRDC’s
predecessors-in-interest. Absent a showing that SRRDC had any
participation, voluntary or otherwise, in the transfers by the
original owners of Lot No. 933, prior to its eventual acquisition of
the same, we affirm that SRRDC is a buyer in good faith and an

innocent purchaser for value. An innocent purchaser for value is
one who, relying on the certificate of title, bought the property
from the registered owner, without notice that some other person
has a right to, or interest in, such property, and pays a full and
fair price for the same, at the time of such purchase, or before he
has notice of the claim or interest of some other person in the
property.
Statutes; Republic Act No. 9443; R.A. No. 9443 confirms and
declares valid all existing Transfer Certificates of Title (TCTs) and
Reconstituted Certificates of Title duly issued by the Register of
Deeds
495
VOL. 532, SEPTEMBER 7, 2007 495
of Cebu Province and/or Cebu City covering any portion of the

Banilad Friar Lands Estate.—There is a recent development that
has sealed the fate of the Republic in its claim of ownership over
the subject properties. This is the passage of Republic Act No.
9443 (RA 9443), entitled “AN ACT CONFIRMING AND
DECLARING, SUBJECT TO CERTAIN EXCEPTIONS, THE
VALIDITY OF EXISTING TRANSFER CERTIFICATES OF
TITLE AND RECONSTITUTED CERTIFICATES OF TITLE
COVERING THE BANILAD FRIAR LANDS ESTATE,
SITUATED IN THE FIRST DISTRICT OF THE CITY OF
CEBU.” The law confirms and declares valid all existing TCTs
and Reconstituted Certificates of Title duly issued by the Register
of Deeds of Cebu Province and/or Cebu City covering any portion
of the Banilad Friar Lands Estate. Thus, by legislative fiat,
SRRDC’s titles covering Lot Nos. 933B-3 and 933B-4 must be
recognized as valid and subsisting.
PETITION for review on certiorari of a decision of the

Court of Appeals.
The facts are stated in the opinion of the Court.
Balgos and Perez for petitioner.
The Solicitor General for respondent.
NACHURA, J.:
1
This is a petition for review on certiorari of a Decision of
the Court of Appeals (CA) in CA-G.R. CV. No. 61758
ordering the cancellation of petitioner San Roque Realty

Development Corporation’s (SRRDC’s) Transfer
Certificates of Title (TCT)
2
Nos. 128197 and 128198, thereby
reversing the Decision of the Regional Trial Court (RTC) of
Cebu City, Branch 12, in Civil Case No. CEB-1843.
The facts, as found by the CA, are as follows:
_______________
1 Penned by Associate Justice Andres B. Reyes, Jr., with Associate

Justices Eubulo G. Verzola and Regalado E. Maambong, concurring.
2 Penned by Judge Aproniano B. Taypin.
496

Republic
“The subject parcels of land are located at Lahug, Cebu City and
were part of Lot No. 933. Lot No. 933 was covered by Transfer
Certificate of Title No. 11946. It was originally owned by Ismael
D. Rosales, Pantaleon Cabrera and Francisco Racaza. On 5
September 1938, subject parcels of land, together with seventeen
(17) others, were the subject of an expropriation proceeding
initiated by the then Commonwealth of the Philippines docketed
as Civil Case No. 781. On 19 October 1938, Judge Felix Martinez
ordered the initial deposit of P9,500.00 as pre-condition for the
entry on the lands sought to be expropriated. On 14 May 1940, a
Decision was rendered (Exhibit “D,” Records, pp. 204-214)
condemning the parcels of land. However, the title of the subject
parcel of land was not transferred to the government.
Eventually, the land was subdivided and T.C.T. No. 11946 was
cancelled and new titles were issued by the Register of Deeds of
Cebu. Two parcels covered by T.C.T. Nos. 128197 (Lot No. 933-B-
3) and 128198 (Lot No. 933-B-4) were acquired by defendant-
appellee. In 1995, defendant-appellee begun construction of
townhouses on the subject parcels of land.
On 22 February 1996, plaintiff-appellant filed the present case
(Records, pp. 1-15) alleging that it is the owner of the subject
parcels of land by virtue of the 1938 Decision in the expropriation
case, thus, T.C.T. Nos. 128197 and 128198 are null and void. It
argued that defendant-appellee, had no right to possess the
subject properties because it was not its lawful owner.
In its Answer (Records, pp. 28-38), defendant-appellee claimed
that it was a buyer in good faith. It also claimed that there was no
valid expropriation because it was initiated by the executive
branch without legislative approval. It also alleged that the
expropriation was never consummated because the government

did not actually
3
enter the land nor were the owners paid any
compensation.”
The appellate court then quotes, verbatim, the evidence

and positions of the parties, as found by the trial court, viz.:
“Plaintiff alleged that the Republic of the Philippines is the

absolute owner of Lot No. 933 of Cebu Cadastre (covered by
Transfer Certificate of Title 11946), a part and parcel of the Camp
Lapu-lapu
_______________
3 Rollo, pp. 48-49.
497
VOL. 532, SEPTEMBER 7, 2007 497

military reservation; that said parcel of land was originally

private property registered in the names of Francisco Racaza,
Pantaleon Cabrera and Josefina Martinez; that on October 19,
1938, plaintiff (then Commonwealth now Republic of the
Philippines) instituted condemnation proceeding against the
owners of eighteen (18) parcels of land including Lot 933 in
Banilad Estate Lahug (Exhibits “A” and “A-1”) before the Court of
First Instance of the Province of Cebu, 8th Judicial District, that
the purpose of expropriation was to carry out the development
program of the Philippine Army as provided in the National
Defense Act, i.e., military reservation; that sometime in October
1938, Judge Felix Martinez ordered plaintiff to make an initial
deposit of P9,500.00 with any depository of the latter payable to
the Provincial Treasurer as pre-condition for the entry on the
lands sought to be expropriated (Exhibit “B”); that, accordingly,
plaintiff deposited said amount with the Philippine National
Bank to the credit of the Provincial Treasurer (Exhibit “C”); that
said amount was subsequently disbursed in full but due to the
destruction of the vouchers, journal and cash book in the Office of
the Provincial Treasurer during the last World War, the names of
the payees could not reasonably be ascertained (Exhibit “P”); that
on May 14, 1940, Judge Martinez issued a Decision condemning
the properties in favor of plaintiffs and, at the same time, fixing
the just compensation thereof (Exhibits “D” and “E”); that
defendant San Roque’s predecessors namely Ismael D. Rosales,
Pantaleon Cabrera and Francisco Racaza interposed and (sic)
Exception and Notice of Intention to Appeal and filed their
corresponding appeal bond (Exhibits “N” & “O”); that naturally,
the filing held temporarily in abeyance the finality of the Decision

and prevented plaintiff from recording the Decision with the
Register of Deeds; that plaintiffs, nonetheless, started using the
expropriated properties including Lot 933, devoting the properties
to military use; that to show use of subject properties, plaintiff
submitted (1) the historical account of the National Historical
Commission embodied in a metal marker located in Lot 932
adjacent to Lot 933 (TSN, January 21, 1997, pp. 6-7; 9; Exhibits
“I,” “I-1,” “I-2”; (2) the testimonial accounts of Sgt. Suralta,
Barangay Captain Rosales, Lt. Colonel Infante and Col. Reynaldo
Correa; and, (3) the remnant of the Lahug Airport, particularly its
runway (originally devoted exclusively for military airport and
landing field as can be gleaned from Executive Orders 73, 75 and
154 dated December 3, 1936, August 12, 1947 and June 24, 1938,
respectively) situated on Lot 933 itself; that survey maps of
defendant and plaintiff have
498

shown the exact location of the runway; that Lot 933 was devoted
to military use by plaintiff not only for building structures but
also military training of the Riverine Battalion (Lot 932, as per
testimony of M/Sgt. Renato Suralta); that these training
continued up to the present (TSN, January 27, 1997, pp. 4-8); that
the area where Park Vista is being built was used as training
ground (TSN, April 3, 1997, p. 2). Plaintiff further alleged that
defendant San Roque secured Certificates of Title in its favor to
the prejudice of plaintiff specifically TCT Nos. 128197 and 128198
covering Lot No. 933-B-3 of the subdivision plan Psd-114779 and
Lot 933-B-4 of the subdivision plan Psd-27-023209, respectively;
that subject parcels of land belong to plaintiff and registration
thereof in the name of defendant San Roque is null and void.
Consequently, defendant San Roque’s possession and ownership
over the subject property are without legal basis.
On the other hand, defendant San Roque alleged that subject
parcels of land have been covered by the Torrens System for
decades and any transactions involving the same including the
alleged expropriation should have been registered and annotated
on the Transfer Certificates of Title; that there has been no
registration much less annotation of said expropriation on TCTs
issued to defendant San Roque nor any [of] its predecessors-in-
interest. (Exhibits “20” to “24,” “25,” “25-A” to “25-C,” Exhibits “2,”
“2-A” to “2-C,” “3,” “3-A” and “3-B”); that plaintiff never secured a
title in its name, never actually took possession of subject parcels
of land from the date of the Decision in Civil Case No. 781 up to
the present; that despite the fact that defendant San Roque’s
Park Vista Project is within viewing and walking distance from
Camp Lapu-lapu, it was able to introduce substantial
improvements (Exhibits “36,” “36-A” to “36-Q”) with no action
being taken by plaintiff; that there are other developments on Lot
933 such as the Cebu Civic and Trade Center which include areas
within the military camp as well (Exhibits “36-R” to “36-V,” “38,”
“38-A” to “38-R”); that plaintiff’s only proof of its claim is the
Camp Lapu-lapu Development Plan (Exhibit “F”) which is a
private survey of plaintiff; that plaintiff knew and was fully aware
of all transactions involving Lot No. 933 up to this date; that
defendant San Roque is an innocent purchaser for value and,
therefore, entitled to the protection of the law as it has every right
to rely on the correctness of the certificates of title issued therefor;
that defendant San Roque and its predecessors-in-interest have
been in open, notorious and continuous possession and enjoyment
of subject property(ies) since 1930; that there is a presumption of
regularity in the
499
VOL. 532, SEPTEMBER 7, 2007 499

issuance of subject TCT Nos. 128197 and 128198 by defendant

Register of Deeds; that the alleged Camp Lapu-lapu Development
Plan, in the absence of any Transfer Certificate of Title in
plaintiff’s name, cannot prevail over defendant San Roque’s
Transfer Certificate of Title; that defendant San Roque’s (sic)
commenced development of subject parcels of land as early as
1993 and started construction in April 1994 upon issuance of
titles in its name, two and a half years prior to institution of the
instant case; that it has been paying real taxes since the
acquisition of subject properties (Exhibits “4,” “4-A” and “4-B,” “5,”
“5-A” and “5-B,” “26” to “35”); that all requirements for such
development, such as securing permits and licenses from
government agencies were complied with (Exhibits “9” to “18-C”);
that it was only on 24 July 1995 that plaintiff initiated steps to
recover possession starting with the letter dated 24 July 1995
(Exhibits “1,” “6,” “7” and “8”) and even addressed to a wrong
entity; that it took plaintiff fifty-six (56) years (counted from the
Decision dated 14 May 1940) to take action to secure its “claimed”
ownership and possession; that private ownership of portions of
Lot 933 have been affirmed by the appellate court by ordering the
City Government of Cebu to pay the private landowner for the
portion used for the expansion of Geongson Road in the case of
Perpetua Magno, et al. versus City of Cebu, CA-G.R. No. 40604-CV
(Exhibits “51” to “55,” “55-A” to “55-C”); that in fact, the plaintiff
paid rental for another allegedly expropriated property in the case

of another expropriated Lot 934 subject of the case of Segura v.
CAA, et al., CA-G.R. No. 12728-CV (Exhs. “56,” “56-A” to “56-B”);
that the alleged expropriation of Lot 933 was never consummated
as plaintiff never entered, much less take possession, of subject
parcels of land and ever paid any compensation to the original
owners despite its being a requisite for valid exercise of the power
of eminent domain; that there is nother (sic) on record which will
show that compensation for the expropriated lots was ever paid
to, much less received by the landowners/predecessors-in-interest
of defendant San Roque; that plaintiff abandoned the public use,
much less did it do so within a reasonable time, the Lahug Airport
had long transferred to Mactan and the areas said airport used to
occupy are now being developed by or on long term lease to
private entities; that alleged initial deposit of P9,500.00 payable
to Provincial Treasurer does not specify for which property the
same was intended for; that if indeed plaintiff actually entered
subject property and introduced improvements thereon it would
not have been possible for defendant San Roque or its prede-
500

cessors-in-interest to have actually possessed and enjoyed the

property from 1938 up to the present to the exclusion of plaintiff;
that the expropriation requires legislative action and thus the
alleged expropriation of Lot 933 is null and void; that City
Ordinances have classified Lot 933 and neighboring lots initially
as residential and presently as commercial (Exhibits “39,” “40,”
“41”); and, finally that the AFP-Viscom is not the proper party to
initiate much less institute suit even assuming the alleged
expropriation is valid as the expropriated lots were placed4 under
the control and supervision of the Civil Aeronautics Board.”
5
On August 25, 1998, the RTC rendered a Decision
dismissing the Republic’s complaint and upholding
SRRDC’s ownership over the subject properties as
supported by SRRDC’s actual possession thereof and its
unqualified title thereto. The RTC ruled that SRRDC’s
ownership is borne out by the original owner’s title to Lot
No. 933 and the subsequent transferees’ respective titles all
of which bore no annotation of the fact of expropriation and
did not indicate the Republic’s favorable lien. It also found
that there was no valid expropriation since the records are
bereft of a showing6
that consideration was paid for the
subject properties.
Aggrieved, the Republic appealed the decision to the CA

insisting on its absolute ownership over the subject
properties grounded on the following: (1) the CFI Decision
in the expropriation case, Civil Case No. 781;7 (2) the ruling
of this Court in Valdehueza v. Republic; and (3) the
expropriated properties, including Lot No. 933, are devoted
to public use.
The CA reversed the RTC Decision on the finding that
the appeal from the CFI Decision in the expropriation case
was never 8perfected by the original owners of the subject
properties, and thus, the expropriation of Lot No. 933
became final
_______________
4 Id., at pp. 49-53.

5 Id., at pp. 121-136.
6 Id., at pp. 130-136.
7 123 Phil. 968; 17 SCRA 107 (1966).
8 Rollo, p. 55.
501
VOL. 532, SEPTEMBER 7, 2007 501

Republic
and binding on the original owners, and SRRDC, which9

merely stepped into the latter’s shoes, is similarly bound.
The CA further held that laches and estoppel cannot work
against the Republic despite its failure from 1940 to
register Lot No. 933 in its 10name, or to record the decree of
expropriation on the title. Accordingly, the CA found no
necessity to rule on 11
the applicability of Valdehueza v.
Republic in the case.
Hence, the instant petition.
In this appeal, SRRDC assigned the following errors:
I.
THE COURT OF APPEALS ERRED IN HOLDING THAT THE

VALIDITY OF THE EXPROPRIATION PROCEEDINGS IN
CIVIL CASE NO. 781 MAY NO LONGER BE QUESTIONED.
RESPONDENT’S OWN (REBUTTAL) EVIDENCE SHOWS
THAT THE DECISION IN CIVIL CASE NO. 781 IS NOT YET
FINAL. FURTHERMORE, THE CONDUCT OF
EXPROPRIATION PROCEEDINGS ALONE DOES NOT
CONFER TITLE UPON RESPONDENT.
II.
THE COURT OF APPEALS ERRED IN HOLDING THAT

RESPONDENT HAD A BETTER RIGHT TO THE SUBJECT
PROPERTIES. THE SUBJECT PROPERTIES BEING UNDER
THE TORRENS SYSTEM, PETITIONER’S RIGHT AS THE
REGISTERED OWNER FAR OUTWEIGHS RESPONDENT’S.
ASIDE FROM THE FACT THAT ITS CLAIM IS OF DOUBTFUL
VALIDITY, RESPONDENT, FOR SEVERAL DECADES,
FAILED TO REGISTER ITS INTEREST, IF ANY, OVER THE
SUBJECT PROPERTIES.
III.
THE COURT OF APPEALS ERRED IN HOLDING THAT

RESPONDENT IS NOT GUILTY OF LACHES DESPITE THE
FACT THAT IT FAILED TO ASSERT ITS RIGHT, IF ANY,
OVER THE SUBJECT PROPERTIES FOR 56 LONG YEARS.
_______________
9 Id.
10 Id., at p. 56.
11 Id., at p. 55.
502

Republic
IV.
THE COURT OF APPEALS ERRED IN HOLDING 12

THAT
PETITIONER IS NOT A BUYER IN GOOD FAITH.
At the outset, we note that issues of ownership and

possession of several lots included in the 18 parcels of land
covering the Banilad Friar Lands Estate had been the
subject of earlier controversies which we already had
occasion to rule upon. Lot Nos. 13932 and 939 were the
subject of Valdehueza v. Republic which is ubiquitously
14
invoked by the Republic in this case. Republic v. Lim dealt
with the special circumstances surrounding the incomplete
and ineffectual expropriation of Lot No. 932. On the other 15
hand, Federated Realty Corporation v. Court of Appeals
preliminarily determined the state of ownership and
possession of a portion of Lot No. 933, particularly Lot 3,
covered by TCT No. 119929.
In Valdehueza, we held that the registered lot owners

were not entitled to recover possession of the expropriated
lots considering that the titles contained annotations of the
right of the National Airports 16
Corporation (now CAA) to
pay for and acquire said lots.
17
In Republic v. Lim, we rejected the Republic’s
invocation of our Decision in Valdehueza to retain
ownership over said lots, and upheld the principle that title
to the expropriated property shall pass from the owner to
the expropriator18
only upon full payment of just
compensation. We struck down the Republic’s claim of
ownership over Lot No. 932 in light of its blatant disregard
of the explicit order in Valdehueza to effect payment of just
compensation.
_______________
12 Id., at p. 22.
13 Supra note 7.
14 G.R. No. 161656, June 29, 2005, 462 SCRA 265.
15 G.R. No. 127967, December 14, 2005, 477 SCRA 707.
16 Supra note 7, at p. 112.
17 Supra note 14.
18 Id., at p. 281.
503
VOL. 532, SEPTEMBER 7, 2007 503

Republic
19
In Federated Realty Corporation v. Court of Appeals we
upheld Federated Realty Corporation’s (FRC’s) clear and
unmistakable right, as the title holder, to the lot in
question, necessitating the issuance of a writ
20
of injunction
to prevent serious damage to its interests. Even as the
Republic invoked Valdehueza and the CFI Decision in Civil
Case No. 781 to defeat the rights of the registered owner
and actual possessor, we applied the settled principle in
land registration that a certificate of title serves as
evidence of an indefeasible and incontrovertible
21
title to the
property in favor of the person named therein.
It is against this backdrop that we resolve the main
issue at bench: the ownership of Lot Nos. 933-B-3 and 933-
B-4. To do so, however, we must answer a number of
fundamental questions.
First, was there a valid and complete expropriation of
the 18 parcels of land, inclusive of subject Lot No. 933?
Corollary thereto, did the CFI Decision in Civil Case No.

781 attain finality and, as such, now evade review?
To these questions, the CA responded in the affirmative.
It found that no timely appeal had been filed by the
original owners of Lot No. 933, and thus, the CFI Decision
became final. Accordingly, the CA ruled that the validity of
the expropriation, including the authority to expropriate,
was no longer open to question. Therefore, the appellate
court saw no necessity to delve into the applicability of
Valdehueza.
We cannot subscribe to the CA’s ruling.
In its effort to simplify the issues, the CA disregarded
relevant facts and ignored the evidence, noteworthy among
which is that when the Republic filed its complaint with
the RTC, it alleged that the CFI Decision in Civil Case No.
781 had long become final and executory. However, this
assertion would
_______________
19 Supra note 15.

20 Id., at p. 724.
21 Id., at pp. 716-717.
504

Republic
compound the Republic’s predicament, because the

Republic could not adequately explain its failure to register
its ownership over the subject property or, at least,
annotate its lien on the title. Trying to extricate itself from
this quandary, the Republic belatedly presented a copy of
an Exception and Notice of Intention to Appeal dated July
9, 1940, to show that an appeal filed by the original owners
of Lot No. 933 effectively prevented the Republic from
registering its title, or even only annotating its lien, over
the property.
The CA’s categorical pronouncement that the CFI
Decision had become final as no appeal was perfected by
SRRDC’s predecessor-in-interest is, therefore, contradicted
by the Republic’s own allegation that an appeal had been
filed by the original owners of Lot No. 933. Not only did the
CA fail to resolve the issue of the Republic’s failure to
register the property in its name, it also did not give any
explanation as to why title and continuous possession of
the property remained with SRRDC and its predecessors-

in-interest for fifty-six years. The CA ruling that disregards
these established facts and neglects to reconcile the
contradiction mentioned above does not deserve
concurrence by this Court.
Furthermore, as correctly pointed out by SRRDC, even if
the appellate court adverted to our finding in Valdehueza
on the finality of the expropriation over the lots subject of
that case, still, SRRDC and its predecessors-in-interest
would not be bound. The reference to the finality of the CFI
Decision in Civil Case No. 781 in Valdehueza applies to
different parties and separate parcels of land.22 We
confirmed this in Federated Realty Corporation v. CA, and
noted23
that our decision in Valdehueza and in Republic v.
Lim did not involve the ownership of Lot No. 933 which
was not subject of those cases.
Second, assuming that the CFI Decision in Civil Case
No. 781 is final and executory, and that the expropriation
pro-
_______________
22 Supra note 15.

23 Supra note 14.
505
VOL. 532, SEPTEMBER 7, 2007 505

Republic
ceedings before that court had been completed, did the

Republic pay just compensation for Lot No. 933?
Regrettably, the CA did not dispose of this issue.
The Republic submits that the P9,500.00 initial deposit
it made was disbursed in full to the owners of the 18 lots
subject of expropriation, and assumes that the owners of
Lot No. 933 were among the recipients of such
disbursement. The Republic admits that records of
payment were destroyed by fire during World War II, and
it cannot be ascertained who received the money. It would
rely simply on the presumption that official duty had been
regularly performed in assuming that the owners of the 18
lots expropriated were adequately paid.
We are not convinced.
The Republic’s bare contention and assumption cannot
defeat SRRDC’s apparent ownership over the subject
properties. As we have previously found in Valdehueza,
24 25
24 25
Republic v. Lim and Federated Realty Corporation v. CA,
by the very admission of the Republic, there was no record
of payment of compensation
26
to the land owners.
In Republic v. Lim, we emphasized that no piece of
land can be finally and irrevocably27 taken from an unwilling
owner until compensation is paid. Without full payment of
just compensation, there can be 28no transfer of title from the
landowner to the expropriator. Thus, we ruled that the
Republic’s failure to pay just compensation
29
precluded the
perfection of its title over Lot No. 932. In fact, we went
even further and recognized the right of the unpaid owner
to recover the property if within five years from the
decision of the expro-
_______________
24 Id.
25 Supra note 15.
26 Supra note 14.
27 Visayan Refining Co. v. Camus, 40 Phil. 550, 561 (1919).
28 Supra note 14, at p. 282.
29 Id., at p. 286.
506

Republic
priation court the expropriator fails to effect payment of

just compensation.
Time and again, we have declared that eminent domain 30
cases are to be strictly construed against the expropriator.
The payment of just compensation for private property
taken for public use is an indispensable requisite for the
exercise of the State’s sovereign power of eminent domain.
Failure to observe this requirement renders the taking
ineffectual, notwithstanding the avowed public purpose. To
disregard this limitation on the exercise of governmental
power to expropriate is to ride roughshod over private
rights.
From the records of this case and our previous findings
in the related cases, the Republic manifestly failed to
present clear and convincing evidence of full payment of
just compensation
31
and receipt thereof by the property
owners. Notably, the CFI Decision in Civil Case No. 781
makes no mention
32
of the initial deposit allegedly made by
the Republic. Furthermore, based on the CFI Decision
fixing the amount of just compensation for some of the lots,

the initial deposit, if it was indeed disbursed, would still
not adequately recompense
33
all the owners of the 18
expropriated lots. More importantly, if the Republic had
actually made full payment of just compensation, in the
ordinary course of things, it would have led to the
cancellation of title, or at least, the annotation of the lien
_______________
30 Id., at p. 280.
31 Federated Realty Corporation v. Court of Appeals, supra note 15, at p.
711; Republic v. Lim, supra note 14, at p. 273; Valdehueza v. Republic,
supra note 7, at p. 973; p. 111; TSN, November 10, 1997, pp. 6-7.
32 Annex “B,” Rollo, pp. 75-80.
33 The decision uniformly fixed the price for all 18 lots, excluding the
improvements, at P0.10 per square meter. (TSN, November 10, 1997, p. 6.)
507
VOL. 532, SEPTEMBER 7, 2007 507

Republic
in favor of the government

34
on the certificate of title
covering Lot No. 933. 35
In Federated Realty Corporation v. CA, we expounded
on the registration requirement in expropriation
proceedings as provided in the law in force at the time of
the CFI Decision, thus:
“The registration with the Registry of Deeds of the Republic’s

interest arising from the exercise of its power of eminent domain
is in consonance with Section 88 of Act No. 496 or the Land
Registration Act (now Section 85 of P.D. 1529 also known as the
Property Registration Decree), to wit:
SEC. 88. Whenever any land of a registered owner, or any right or

interest therein, is taken by eminent domain, the Government or
municipality or corporation or other authority exercising such right shall
file for registration in the proper province a description of the registered
land so taken, giving the name of such owner thereof, referring by
number and place of registration in the registration book to each
certificate of title, and stating what amount or interest in the land is
taken, and for what purpose. A memorandum of the right or interest
taken, shall be made on each certificate of title by the register of deeds,
and where the fee simple is taken a new certificate shall be entered to the
owner for the land remaining to him after such taking, and a new
certificate shall be entered to the Government, municipality, corporation,

or other authority exercising such right for the land so taken. All fees on
account of any memorandum of registration or entry of new certificate
shall be paid by the authority taking the land.
Furthermore, Section 251 of the Code of Civil Procedure, the

law in force at the time of the Commonwealth case likewise
provides for the recording of the judgment of expropriation in the
Registry of Deeds. Said provision reads, to wit:
SEC. 251. Final Judgment, Its Record and Effect.—The record of the final
judgment in such action shall state defi
_______________
34 Federated Realty Corporation v. Court of Appeals, supra note 15, at p. 719.

35 Id.
508

nitely by metes and bounds and adequate description. The particular

land or interest in land condemned to the public use, and the nature of
the public use. A certified copy of the record of judgment shall be
recorded in the office of the registrar of deeds for the province in
which the estate is situated, and its effect shall be to vest in the
plaintiff for the public use stated the land and estate so
described. (Emphasis supplied)
There is no showing that the Republic complied with the

aforestated registration requirement. Without such compliance, it
cannot be said that FRC had notice of the Republic’s adverse
claim sufficient to consider the former in bad faith, for the law
gives the public the right to rely on the face of the Torrens title
and to dispense with the need of further inquiry, except only
when one has actual knowledge of facts and circumstances that
should impel a reasonably cautious man to inquire further into its
integrity. Such is the very essence of our Torrens system as ruled
in Legarda v. Saleeby,31 Phil. 590, thus:
The real purpose of the system is to quiet title of land; to put a stop
forever to any question of the legality of the title, except claims which
were noted at the time of registration, in the certificate, or which may
arise subsequent thereto. That being the purpose of the law, it would
seem that once a title is registered, the owner may rest secure, without
the necessity of waiting in the portals of the courts, or sitting in the
“mirador de su casa,” to avoid the possibility of losing his land. x x x The
certificate, in the absence of fraud, is the evidence of title and shows
exactly the real interest of its owner. The title once registered, with very
few exceptions, should not thereafter be impugned, except in some direct
proceeding permitted by law. Otherwise, all security in registered titles
36
would be lost.”
From the foregoing, it is clear that it was incumbent upon

the Republic to cause the registration of the subject
properties in its name or record the decree of expropriation
on the title. Yet, not only did the Republic fail to register
the subject properties in its name, it failed to do so for fifty-
six (56) years.
_______________
36 Id., at pp. 719-721.
509
VOL. 532, SEPTEMBER 7, 2007 509

Republic
This brings us to the third question that begs resolution: Is

the Republic, by its failure or neglect to assert its claim,
barred by laches?
Laches is the failure or neglect, for an unreasonable and
unexplained length of time, to do that which by exercising
due diligence could or should have been done earlier; it is
negligence or omission to assert a right within a reasonable
time, warranting a presumption that the party entitled37 to
assert it either has abandoned it or declined to assert it.
The general rule is that the State cannot be put in
estoppel or38 laches by the mistakes or errors of its officials
or agents. This rule, however, admits of exceptions. One
exception is when the strict application of the rule will
defeat39the effectiveness of a policy adopted to protect the
public such as the Torrens system. 40
In Republic v. Court of Appeals, we ruled that the
immunity of government from laches and estoppel is not
absolute, and the government’s silence or inaction for
nearly twenty (20) years (starting from the issuance of St.
Jude’s titles in 1966 up to the filing of the Complaint in
1985) to correct and recover the alleged increase in the land
area of St. Jude was tantamount to laches.
In the case at bench, the Republic failed to register the
subject properties in its name and incurred in laches
spanning more than five-and-a-half (5 1/2) decades. Even if
we were to accede to the Republic’s contention that the
Exception and Notice of Intention to Appeal filed by the

original owners of Lot No. 933 initially prevented it from
registering said property in its name, we would still be
hard pressed to find justifi-
_______________
37 Olizon v. Court of Appeals, G.R. No. 107075, September 1, 1994, 236

SCRA 148, 157-158.
38 Republic v. Court of Appeals, G.R. No. 116111, January 21, 1999, 301
SCRA 366, 377.
39 Id., citing 31 CJS 675-676, p. 377.
40 Id., at pp. 378-379.
510

Republic
cation for the Republic’s silence and inaction for an

excessively long time.
Very telling of the Republic’s silence and inaction,
whether intentional or by sheer negligence, is the
testimony of Antonio L. Infante,41 the Republic’s witness in
the proceedings before the RTC.
42
On cross-examination, he
testified that several surveys were conducted
43
on a number
of expropriated lots, including Lot No. 933. The results of
these surveys showed that Lot No. 93344was still registered
in the name of the original owners. As such, Infante 45
recommended in his report that legal action be taken. Yet,
despite the aforesaid recommendation, title to Lot No. 933
remained registered in the name of the original owners,
and subsequently its transferees. This silence and
unexplained inaction by the Republic clearly constitute
laches.
A fourth basic question is whether or not SRRDC is a
buyer in good faith.
The CA found SRRDC wanting in good faith because it
should be imputed with constructive knowledge, or at least,
sufficiently warned that the Republic had claims over the
property in view of indications that the subject land
belonged to a military reservation.
Contrary to the CA’s findings, however, Infante testified
that there were no facilities installed by the AFP on Lot
No. 933, although sometime in 1984 46
to 1985, there began
some illegal construction thereon. He was uncertain as to
whether a criminal case was filed against those responsible
for the illegal construction, and simply referred to an

arrangement
_______________
41 Antonio L. Infante, former military officer and real estate officer of

AFP VISCOM.
42 In 1975, 1977, 1982, 1984, 1992, and 1994.
43 TSN, April 2, 1997, p. 6.
44 Id., at pp. 10-11.
45 Id.
46 Id., at p. 9.
511
VOL. 532, SEPTEMBER 7, 2007 511

Republic
between the AFP and an Amores Realty which 47

prevented
the former from filing a case against the latter.
Significantly, the records also reveal that the Republic’s
possession of the 18 expropriated lots pertain only to the
lots adjacent to Lot No. 933. At most, the Lahug Airport
runway traverses only a portion of Lot No. 933 situated in
Lot No. 933-A, and not Lot No. 933-B which is the subject
of this case. Even if these lots were originally part of Lot
No. 933, the lack of annotation on the title of the decree of
expropriation, and its eventual segregation into several lots
covered by separate titles enabled SRRDC to purchase the
subject properties, for value, free from any lien, and
without knowledge of the Republic’s adverse claim of
ownership.
The trial court correctly held that title registered
48
under
the Torrens system is notice to the world. Every person
dealing with registered land may safely rely on the
correctness of its certificate of title and the law will not
oblige him to go beyond what appears on49 the face thereof to
determine the condition of the property.
The conveyance history of the subject properties is
clearly shown on the titles of SRRDC’s predecessors-in-
interest. Absent a showing that SRRDC had any
participation, voluntary or otherwise, in the transfers by
the original owners of Lot No. 933, prior to its eventual
acquisition of the same, we affirm that SRRDC is a buyer
in good faith and an innocent purchaser for value.
An innocent purchaser for value is one who, relying on
the certificate of title, bought the property from the
registered owner, without notice that some other person

has a right to, or interest in, such property, and pays a full
and fair price for
_______________
47 Id.
48 Rollo, p. 130.
49 Id., at p. 434.
512

Republic
the same, at the time of such purchase, or before he has

notice of 50the claim or interest of some other person in the
property. 51
Likewise, Section 32 of Presidential Decree No. 1529
provides:
“SECTION 32. Review of decree of registration; Innocent purchaser

for value.—The decree of registration shall not be reopened or
revised by reason of absence, minority, or other disability of any
person adversely affected thereby, nor by any proceeding in any
court for reversing judgments, subject, however, to the right of
any person, including the government and the branches thereof,
deprived of land or of any estate or interest therein by such
adjudication or confirmation of title obtained by actual fraud, to
file in the proper Court of First Instance a petition for reopening
and review of the decree of registration not later than one year
from and after the date of the entry of such decree of registration,
but in no case shall such petition be entertained by the court
where an innocent purchaser for value has acquired the land or
an interest therein, whose rights may be prejudiced. Whenever
the phrase “innocent purchaser for value” or an equivalent phrase
occurs in this Decree, it shall be deemed to include an innocent
lessee, mortgagee, or other encumbrancer for value.
Upon the expiration of said period of one year, the decree of
registration and the certificate of title issued shall become
incontrovertible. Any person aggrieved by such decree of
registration in any case may pursue his remedy by action for
damages against the applicant or any other persons responsible
for the fraud.”
In the instant case, the Republic’s adverse claim of

ownership over the subject properties may have given
SRRDC’s predecessors-in-interest, the sellers, voidable title

to the subject properties. However, we stress that prior to
SRRDC’s
_______________
50 Realty Sales Enterprise, Inc. v. Intermediate Appellate Court, G.R.

No. L-67451, September 28, 1987, 154 SCRA 328, 345, citing Cui v.
Henson, 51 Phil 606 (1928), Fule v. DeLegare, 117 Phil. 367; 7 SCRA 351
(1963).
51 Amending and codifying the laws relative to registration of property
and for other purposes.
513
VOL. 532, SEPTEMBER 7, 2007 513

Republic
acquisition of the subject properties, Lot No. 933 had

already been subdivided and covered by separate titles of
the subsequent transferees. These titles, including the
titles to the subject properties, had not been voided at the
time of the sale to SRRDC in 1994. As such, SRRDC
acquired good title to the subject properties, having
purchased them in good faith, for value, and without notice
of the seller’s defect of title, if any.
Finally, there is a recent development that has sealed
the fate of the Republic in its claim of ownership over the
subject properties. This is the passage of Republic Act No.
9443 (RA 9443), entitled “AN ACT CONFIRMING AND
DECLARING, SUBJECT TO CERTAIN EXCEPTIONS,
THE VALIDITY OF EXISTING TRANSFER
CERTIFICATES OF TITLE AND RECONSTITUTED
CERTIFICATES OF TITLE COVERING THE BANILAD
FRIAR LANDS ESTATE, SITUATED 52
IN THE FIRST
DISTRICT OF THE CITY OF CEBU.” The law
_______________
52
[REPUBLIC ACT NO. 9443]
AN ACT CONFIRMING AND DECLARING SUBJECT TO CERTAIN

EXCEPTIONS, THE VALIDITY OF EXISTING TRANSFER
CERTIFICATES OF TITLE AND RECONSTITUTED CERTIFICATES
OF THE TITLE COVERING THE BANILAD FRIAR LANDS ESTATE,
SITUATED IN THE FIRST DISTRICT OF THE CITY OF CEBU.
SECTION 1. All existing Transfer Certificates of Title and

Reconstituted Certificates of Title duly issued by the Register of Deeds of
Cebu Province and/or Cebu City covering any portion of the Banilad Friar
Lands Estate, notwithstanding the lack of signatures and/or approval of
the then Secretary of the Interior (later Secretary of Agriculture and
Natural Resources) and/or the then Chief of the Bureau of Public Lands
(later Director of Public Lands) in the copies of the duly executed Sale
Certificates and Assignments of Sales Certificates, as the case may be,
now on file with the Community Environment and Natural Resources
Office (CENTRO), Cebu City, are hereby confirmed and declared as valid
titles and the registered owners recognized as absolute owners thereof.
This confirmation and declaration of validity shall in all respects be
entitled to like effect and credit as a decree of registration,
514

Republic
confirms and declares valid all existing TCTs and

Reconstituted Certificates of Title duly issued by the
Register of Deeds of Cebu Province and/or Cebu City 53
covering any portion of the Banilad Friar Lands Estate.
Thus, by legislative fiat, SRRDC’s titles covering Lot Nos.
933B-3 and 933B-4 must be recognized as valid and
subsisting.
In fine, we hold that the operative facts in the case at
bar, to wit: (1) the incomplete expropriation of Lot No. 933
in view of Republic’s failure to prove payment in full of just
compensation; (2) the registration under the Torrens
system of the subject properties in the name of SRRDC and
its predecessors-in-interest; (3) the estoppel and laches of
the Republic for 56 years; (4) the status of SRRDC as an
innocent purchaser for value; and (5) the passage of R.A.
No. 9443, all warrant the reversal of the CA Decision.
WHEREFORE, premises considered, the petition is
GRANTED. The August 15, 2003 Decision of the Court of
Appeals is hereby REVERSED and the August 25, 1998
Decision of the Regional Trial Court is REINSTATED. TCT
Nos.
_______________
binding the land and quieting the title thereto and shall be conclusive
upon and against all persons, including the national government and all
branches thereof; except when, in a given case involving a certificate of
title or a reconstituted certificate of title, there is clear evidence that such
certificate of title or reconstituted certificate of title was obtained through

fraud, in which case the solicitor general or his duly designated
representative shall institute the necessary judicial proceeding to cancel
the certificate of title or reconstituted certificate of title as the case may
be, obtained through such fraud.
SEC. 2. All laws, decrees, proclamations or issuances contrary to or
inconsistent with the provisions of this Act are hereby repealed, amended
or modified accordingly.
SEC. 3. This Act shall take effect fifteen (15) days after its publication
in the Official Gazette or in at least two national newspapers of general
circulation.
53 Published on July 11 and 12, 2007 in The Daily Tribune and Balita,
respectively. Effective 15 days therefrom, or on July 27, 2007.
515
VOL. 532, SEPTEMBER 7, 2007 515

Lascano vs. People
128197 and 128198, in the name of petitioner San Roque

Realty and Development Corporation, are upheld and
declared valid.
SO ORDERED.
Ynares-Santiago (Chairperson), Austria-Martinez,

Chico-Nazario and Reyes, JJ., concur.
Petition granted, judgment reversed. That of trial court

reinstated.
Notes.—Laches is principally a doctrine of equity, and

courts apply laches to avoid recognizing a right when to do
so would result in a clearly inequitable situation or in an
injustice. (Republic vs. Court of Appeals, 454 SCRA 516
[2005])
The exercise of the power of eminent domain necessarily
involves a derogation of a fundamental right—it greatly
affects a landowner’s right to private property which is a
constitutionally protected right necessary for the
preservation and enhancement of personal dignity and is
intimately connected with the rights to life and liberty.
(Beluso vs. Municipality of Panay [Capiz], 498 SCRA 113
[2006])
——o0o——
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6/3/2020 SUPREME COURT REPORTS ANNOTATED VOLUME 532

VOL. 532, SEPTEMBER 7, 2007 493

SAN ROQUE REALTY AND DEVELOPMENT

Eminent Domain; Time and again, the Court has declared

Same; If the Republic had actually made full payment of just

Same; Laches; Torrens System; While the general rule is that

494 SUPREME COURT REPORTS ANNOTATED

San Roque Realty and Development Corporation vs. Republic

Innocent Purchasers for Value; Words and Phrases; An

the same, we affirm that SRRDC is a buyer in good faith and an

VOL. 532, SEPTEMBER 7, 2007 495

San Roque Realty and Development Corporation vs. Republic

of Cebu Province and/or Cebu City covering any portion of the

PETITION for review on certiorari of a decision of the

ordering the cancellation of petitioner San Roque Realty

1 Penned by Associate Justice Andres B. Reyes, Jr., with Associate

496 SUPREME COURT REPORTS ANNOTATED

expropriation was never consummated because the government

The appellate court then quotes, verbatim, the evidence

“Plaintiff alleged that the Republic of the Philippines is the

3 Rollo, pp. 48-49.

VOL. 532, SEPTEMBER 7, 2007 497

military reservation; that said parcel of land was originally

the filing held temporarily in abeyance the finality of the Decision

498 SUPREME COURT REPORTS ANNOTATED

VOL. 532, SEPTEMBER 7, 2007 499

issuance of subject TCT Nos. 128197 and 128198 by defendant

paid rental for another allegedly expropriated property in the case

500 SUPREME COURT REPORTS ANNOTATED

cessors-in-interest to have actually possessed and enjoyed the

Aggrieved, the Republic appealed the decision to the CA

4 Id., at pp. 49-53.

VOL. 532, SEPTEMBER 7, 2007 501

and binding on the original owners, and SRRDC, which9

THE COURT OF APPEALS ERRED IN HOLDING THAT THE

THE COURT OF APPEALS ERRED IN HOLDING THAT

THE COURT OF APPEALS ERRED IN HOLDING THAT

502 SUPREME COURT REPORTS ANNOTATED

THE COURT OF APPEALS ERRED IN HOLDING 12

At the outset, we note that issues of ownership and

In Valdehueza, we held that the registered lot owners

VOL. 532, SEPTEMBER 7, 2007 503

Corollary thereto, did the CFI Decision in Civil Case No.

19 Supra note 15.

504 SUPREME COURT REPORTS ANNOTATED

compound the Republic’s predicament, because the

the property remained with SRRDC and its predecessors-

22 Supra note 15.

VOL. 532, SEPTEMBER 7, 2007 505

ceedings before that court had been completed, did the

506 SUPREME COURT REPORTS ANNOTATED

priation court the expropriator fails to effect payment of

fixing the amount of just compensation for some of the lots,

VOL. 532, SEPTEMBER 7, 2007 507

in favor of the government

“The registration with the Registry of Deeds of the Republic’s

SEC. 88. Whenever any land of a registered owner, or any right or

certificate shall be entered to the Government, municipality, corporation,

Furthermore, Section 251 of the Code of Civil Procedure, the