Carino v Insular Government G.R. No. 2869 (1907)

J. Arellano

Facts:

Mateo Cariño, on  February 23 , 1904, filed his petition in the Court of Land Registration for a title to a parcel of land consisting of 40 hectares, 1 are, and 13 centares in the town of Baguio, Province of Benguet. This was heard with a petition for a title for a portion of the land.

The Insular Government opposed the granting of these petitions, because they alleged that the whole parcel of land is public property of the Government and that the same was never acquired in any manner or through any title of egresion from the State.

According to Carino, in 1884, he erected and utilized as a domicile a house on the property situated to the north of that property now in question. They said that during the year 1893 Cariño sold said house to one Cristobal Ramos, who in turn sold the same to Donaldson Sim. Carino abandoned the house and lived on the land in question.

The court of land registration ruled against their favor. They also ruled that the land was "used for pasture and sowing," and belongs to the class called public land.

Issue: Is Carino the rightful possessor of the land?

Held: No, petition denied.

Ratio:

Under the express provisions of law, a parcel of land being of common origin, presumptively belonged to the State during its sovereignty, and, in order to perfect the legitimate acquisition of such land by private persons, it was necessary that the possession of the same pass from the State.

There was no proof of title of egresion of this land from the domain of the Spanish Government.

The possessory information was not the one authorized in substitution for the one in adjustment of the royal decree of February 13, 1894. This was due to:

1. the land has been in an uninterrupted state of cultivation during a period of six years last past; or that the same has been possessed without interruption during a period of twelve years and has been in a state of cultivation up to the date of the information and during the three years immediately preceding such information; or that such land had been possessed openly without interruption during a period of thirty or more years, notwithstanding the land had not been cultivated

Or such land had been possessed openly without interruption during a period of thirty or more years, notwithstanding the land had not been cultivated

2. Under Spanish law, there was a period of one year allowable to verify the possessory information. After the expiration of this period of the right of the cultivators and persons in possession to obtain gratuitous title thereto lapses and the land together with full possession reverts to the state, or, as the case may be, to the community, and the said possessors and cultivators or their assigns would simply have rights under universal or general title of average in the event that the land is sold within a period of five years immediately following the cancellation. The possessors not included under this chapter can only acquire by time the ownership and title to unappropriated or royal lands in accordance with common law.

In accordance with the preceding provisions, the right that remained to Cariño, if it be certain that he was the true possessor of the land in question, was the right of average in case the Government or State could have sold the same within the period of five years immediately following for example, if the denouncement of purchase had been carried out by Felipe Zafra or any other person, from the record of the case

The right of possession in accordance with civil law remained at all times subordinate to the Spanish administrative law, inasmuch as it could only be of force when pertaining to royal transferable or alienable lands even until after February 13, 1894.

3. The advent of American sovereignty necessarily brought a new method of dealing with lands and particularly as to the classification and manner of transfer and acquisition of royal or common lands then appropriated, which were thenceforth merely called public lands, the alienation of which was reserved to the Government, in accordance with the Organic Act of 1902 and other laws like Act No. 648, herein mentioned by the petitioner.

Section 6 of Act No. 627 admits prescription, as a basis for obtaining the right of ownership. "The petitioners claim the title under the period of prescription of ten years established by that act, as well as by reason of his occupancy and use from time immemorial. But said act admits such prescription for the purpose of obtaining title and ownership to lands not exceeding more that 16 hectares in extent." Under Sec. 6 of said act. The land claimed by Cariño is 40 hectares in extent, if we take into consideration his petition, or an extension of 28 hectares, therefore it follows that the judgment denying the petition herein and now appealed from was strictly in accordance with the law invoked.

 And of the 28 hectares of land as set out in the possessory information, one part of same, according to the testimony of Cariño, belongs to Vicente Valpiedad, the extent of which is not determined. From all of which it follows that the precise extent has not been determined in the trial of this case on which judgment might be based in the event that the judgment and title be declared in favor of the petitioner, Mateo Cariño. And we should not lose sight of the fact that, considering the intention of Congress in granting ownership and title to 16 hectares, that Mateo Cariño and his children have already exceeded such amount in various acquirements of lands, all of which is shown in different cases decided by the said Court of Land Registration.

Vda de Urbano v GSIS (2001)

Vda De Urbano v Gsis

2001

Facts

In 1971, petitioners mortgaged their 200 sqm property in Q.C. to Gsis to secure a housing loan. Since they were unable to pay the loan, GSIS foreclosed the mortgage in 1988. GSIS bid 154k on the property and emerged as the highest bidder.

In 1984, the petitioners tried to reclaim their property. They wrote to the GSIS Acquired Assets Department signifying their intent to reclaim. On October 16, GSIS told them to pay the redemption price of 154k in full before Nov 18, 1984.

The petitioners asked for more time to recover the property while the Acquired Assets Dpeartment subsequently told them to pay 174k in cash with an extension of 30 days to the November date. Failure to do so forfeited the reclamation of the property and sold in a public bidding.

The petitioners wrote again requesting for remortgage through repurchase of the property. The Gsis AAD declined.

The petitioners wrote to the Board for an approval to file a loan worth 240,000 with the GSIS real estate department to repurchase their foreclosed property. Despite attempts from Vice Governor Mathay to adjust to a more liberal arrangement for the petitioners, the the petitioners were unable to pay. GSIS then issued a TCT in its favor.

The respondent De La Cruz entered the picture and offered to purchase the property for 250,000 spot cash. Without knowledge of the rival offer, the petitioners then offered a 50,000 downpayment with the 124k balance to be paid in 5 years.  He also enclosed 10k in check as earnest money. The Board informed them that it had adopted reolution 881 that declined their offer to repurchase.

At the same time, GSIS negotiated with Dela Cruz for the purchase of the property. They accepted her offer of purchase. A new TCT was issued to her.

The petitioners, on the other hand, had their loan request rescinded because a certificate of award or sale was not issued in favor of the applicant. Moreover, the applicant, Urbano the petitioner, was 81 years old and no longer a member of the GSIS. It wasn’t given due consideration.

Having learned about the transaction with dela Cruz, the petitioners  requested the formal investigation with the GSIS regarding the sale. Not satisfied, they filed a case with the RTC of QC branch 102.

The petition was dismissed. The same view was upheld by the court of appeals.

Hence this petition.

Issues:

1. Do petitioners have a right to repurchase the subject property?

2. Does GSIS have a duty to dispose of the subject property through public bidding?

3. Was Gsis in bad faith in dealing with petitioners?

Ruling: Petition Dismissed

Ratio:

1. No

Charter of the GSIS was PD 1146 which stipulated the power of the GSIS to acquire, utilize, and dispose of real or personal properties in the Philippines or elsewhere. It was amended by PD 1981 which gave the GSIS the power to compromise or release any claim or settled liability to the system.

SC- The laws granted the GSIS Board the power to exercise discretion in determining the terms and condition of financial accommodations to its members with the dual purpose of making the GSIS more responsive  to the needs of GSIS members.  The laws also stipulated that the Board could exercise discretion on whether to accept or reject petitioner’s offer to repurchase the subject property taking into account the dual purpose enunciated in the whereas clause of PD 1981 which made the GSIS more responsive to the needs of its members.

With regard to the Board’s exercise of discretion, in Natino v IAC,  the Court also held that repurchase of foreclosed property after redemption period imposes no such obligation on the purchaser  (the board in this case) to re-sell the property since the property belongs to him (the board as well)

The board’s denial of petitioner’s request to purchase the subject property was not based on whim but on a factual assessment of the financial capacity of the petitioners to make good their repeated offers to purchase the subject property. Based on the circumstances, the petitioners were repeatedly unable to fulfill their obligations to pay. In the comments of the AAD manager, the observation was that the petitioners lacked the capacity to pay up.

The petitioners are not entitled to a request for repurchase as a matter of right. The Board exercised its discretion in accordance with law in denying their requests and the GSIS can’t be faulted for their failure to repurchase as it acted under the petitioner’s application under Operation Pabahay. The sale to respondent can’t be annulled on such invoked “right”.

2. No. The agreement with de la Cruz was valid.

Pets.- aver that Sec. 79 of PD 1445 and the COA Circular 86-264 mandated the GSIS to dispose of the assets through public bidding and only upon its failure, through a public sale.

GSIS contended that SEC 79 of PD 1445 did not apply because it covered unserviceable govt property and not acquired assets.

SC- Gsis was right. Why? The provision (SEC 79) applies only to unserviceable govt property or those no longer needed. The house was obviously not unserviceable. And it was still used by petitioners.

With regard to COA Circular 86-264 or the “General guidelines on the divestment or disposal of assets of government owned corporations” the law stipulated that it availed of an exception to the requirement of disposition through  public bidding and such exception applied to sales of merchandise held for sale in the regular course of business.  The Court read it in relation to Coa circular 89-296 which provided for  “Audit Guidelines on the Disposal of Property and other Assets of Government Agencies”, which also did not apply the public bidding disposal requirement to merchandise or inventory held for sale in the regular course of business nor to the disposal by gov’t financial institutions of foreclosed assets or collaterals acquired in the regular course of business and not transferred to the Govt under proclamation no 50.

The modes of disposal included Public auction and sale thru negotiation.

Doctrine: With regard to these 2 laws, the Court held  the question whether the subject property was covered by the said Circular or falls under its exception. It held that 89-296 was to be interpreted with 86-264 in adherence with stat con wherein statutes that relate to the same thing ought to be taken in consideration in construing any one of them, and it is an established rule of law that all acts in pari material are to be taken together as if they were one law.

Moreover, the court looked into the intent of both laws and held that these were used to generate more revenue for GOCC’S through the disposition of its non-preforming assets. (Look into PD 50 or the asset privatization trust in the case) According to the court, the policy intent on the disposition of acquired assets then governed the case at bar.

Was the property covered by the public bidding exceptions in these laws? The court said yes, which meant that their sale negotiation fell under the regular course of business, and thus did not offend the requirements of the said coa circulars.   

3. No.

GSIS denial of petitioners’ further requests for repurchase of subject property was based on a factual determination of the petitioners’ financial capacity and the GSIS charter, PD 1146. Also, GSIS sold the property to dela Cruz only after giving them one year to repurchase.

The petitioners, on the strength of the Valmonte case, can’t also impute bad faith on GSIS when it was secretly negotiating with Dela Cruz. In the Valmonte case, the court held that the constitutional right to information was limited to matters of public concern to transactions involving public interest.The sale of the property was not imbued by public interests as it was a purely private transaction. Pets. Can’t  demand to be informed of such public negotiation since they had no interest on the subject property since they failed to comply with the GSIS terms of repurchase and the denial to repurchase under the GSIS terms.