FIRST DIVISION

[G.R. No. 175542. June 5, 2013.]

GREEN ACRES HOLDINGS, INC. , petitioner, vs . VICTORIA P. CABRAL,

SPS. ENRIQUE T. MORAGA and VICTORIA SORIANO, FILCON READY
MIXED, INC., DEPARTMENT OF AGRARIAN REFORM ADJUDICATION
BOARD (DARAB), and REGISTRY OF DEEDS OF BULACAN,
MEYCAUAYAN BRANCH , respondents.

[G.R. No. 183205 June 5, 2013]

VICTORIA P. CABRAL , petitioner, v s . PROVINCIAL ADJUDICATOR,

JOSEPH NOEL C. LONGBOAN/OFFICE OF THE AGRARIAN REFORM
ADJUDICATOR, GREEN ACRES HOLDINGS, INC., SPOUSES ENRIQUE
T. MORAGA and VICTORIA SORIANO and FILCON READY MIXED,
INC. , respondents.

DECISION

VILLARAMA, JR., J : p

Before us are two consolidated petitions for review on certiorari under Rule 45 of
the 1997 Rules of Civil Procedure, as amended.
In G.R. No. 175542 , petitioner Green Acres Holdings, Inc. (hereafter, Green Acres)
assails the November 24, 2006 Decision 1 of the Court of Appeals (CA) in CA-G.R. CV No.
85766 dismissing its appeal from the November 3, 2004 Order 2 of the Regional Trial
Court (RTC) while in G.R. No. 183205 , petitioner Victoria Cabral seeks to set aside the
February 27, 2008 Decision 3 and May 29, 2008 Resolution 4 of the CA in CA-G.R. SP No.
99651.
The facts are as follows:
Victoria Cabral was the original owner of a parcel of land in Barangay Pandayan,
Meycauayan, Bulacan with an area of 11,432 square meters and covered by Transfer
Certi cate of Title (TCT) No. T-73737 (M). The land was placed under the coverage of
Presidential Decree (P.D.) No. 27, and on March 23, 1993, three Emancipation Patents
were issued to the spouses Enrique Moraga and Victoria Soriano (Spouses Moraga) as
follows: EP No. 496039 with an area of 861 square meters; EP No. 496040 with an area of
2,159 square meters; and EP No. 496041 with an area of 8,941 square meters. The
Spouses Moraga thereafter caused the cancellation of EP No. 496041 and its conversion
to TCT No. 256260 (M).
On August 29, 1994, Cabral led a complaint before the Provincial Agrarian Reform
Adjudicator (PARAD) seeking the cancellation of the Emancipation Patents issued to the
Spouses Moraga on the grounds that these were obtained through fraud and that the land
is not suitable for rice and corn production and has long been classi ed as residential,
commercial, industrial and nonagricultural land by the Zoning Administrator of the Housing
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 and Land Use Regulatory Board. The case was docketed as Reg. Case No. 739-Bul-94.
On December 15, 1995, the PARAD rendered a decision denying the petition for
cancellation of the Emancipation Patents and dismissing the complaint for lack of merit.
Cabral appealed the decision to the Department of Agrarian Reform Adjudication Board
(DARAB). 5
While the appeal was pending, the Spouses Moraga subdivided the lot covered by
TCT No. 256260 (M) into three smaller lots, the properties subject of this case. TCT Nos.
T-270125 (M) covering 3,511 square meters, T-270126 (M) covering 2,715 square meters,
and T-270127 (M) covering 2,715 square meters were thereafter issued in their names on
May 29, 1996. On June 19, 1996, the Spouses Moraga sold the lots to Filcon Ready Mixed
Inc. (Filcon for brevity) and TCT Nos. T-274486 (M), 6 T-274487 (M) 7 and T-274488 (M) 8
were issued in the name of Filcon on June 24, 1996.
On April 29, 1999, Green Acres purchased 9 ve lots from Filcon including the three
subject properties covered by TCT Nos. T-274486 (M), T-274487 (M) and T-274488 (M) in
the name of Filcon. Except for an already cancelled annotation of a real estate mortgage in
favor of Philippine Commercial International Bank (PCI Bank), 1 0 the titles were free from
any annotations, liens, notices, claims or encumbrances.
On April 30, 1999, the titles of Filcon were cancelled by the Register of Deeds of
Meycauayan, Bulacan and new titles were issued in the name of Green Acres including TCT
Nos. T-345660 (M), 1 1 T-345661 (M) 1 2 and T-345662 (M) 1 3 covering the subject
properties. Green Acres then constructed a warehouse building complex on the said lots.
On January 17, 2001, the DARAB resolved Cabral's appeal and rendered judgment
ordering the cancellation of the titles issued in the names of the Spouses Moraga and
those of Filcon for having been illegally acquired. The dispositive portion of the DARAB
decision reads:
WHEREFORE, premises considered, the decision is hereby REVERSED
and SET ASIDE and a NEW JUDGMENT is rendered disposing as follows:

1. Ordering the cancellation of TCT No. EP-051 (M) (EP No. 496039;
TCT No. EP-052 (M) (EP No. 496040); TCT No. EP-052 (M) (EP No. 496041); TCT
No. T-270125 (M); TCT No. T-270126 (M); and TCT No. T-270127 (M) — all in the
names of defendants spouses Moraga; TCT No. 274486 (M); TCT No. T-[2]74487
(M), and TCT No. T-274488 (M) — all in the name of FILCO[N] READY MIXED INC;
2. Directing the Register of Deeds of Bulacan to restore TCT No. T-
73737 (M) in the name of plaintiff Victoria P. Cabral;

3. Ordering defendants Moraga and their assign, FILCO[N] READY

MIXED INC., to vacate the premises of the lands in question and turn over their
possession to herein plaintiff; and,

4. All claims and counterclaims of both parties are hereby dismissed

for insufficiency of evidence.

SO ORDERED. 14

When Green Acres learned about the DARAB decision, it sent a letter 1 5 to Filcon on
March 15, 2001 advising the latter that it learned that the properties it bought from Filcon
were the subject of an adverse decision of the DARAB. Fearing that its titles and
possession might be disturbed by the DARAB decision, Green Acres reminded Filcon of its
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 warranties under the deed of sale.
In a letter 1 6 dated March 30, 2001, Filcon replied that it was also an innocent
purchaser for value since at the time it purchased the subject property, it had no
knowledge of any legal in rmity in the title of the Spouses Moraga. In fact, it was able to
secure a loan from PCI Bank in the amount of P12 million with the subject property as
collateral. Filcon assured Green Acres that it is coordinating with its predecessor, the
Spouses Moraga, to make sure that Green Acres' interest over the property is protected.
On April 19, 2001, Green Acres led a Complaint 1 7 for Quieting of Title, Damages
with Application for Preliminary Injunction and Writ of Preliminary Attachment before the
RTC of Malolos, Bulacan against Cabral, the Spouses Moraga, Filcon, the DARAB and the
Registry of Deeds of Meycauayan, Bulacan. The case was docketed as Civil Case No. 279-
M-2001. Green Acres sought to quiet its title and alleged that it is a purchaser in good faith
and for value, claiming that it had no notice or knowledge of any adverse claim, lien, or
encumbrance on the properties. Neither was it a party to the DARAB proceedings nor did it
have notice of the said proceedings where the DARAB Decision of January 17, 2001 was
issued. Green Acres claimed that the DARAB decision casts a cloud on its titles.
Cabral, in her Answer, 1 8 denied all the material allegations in the complaint and
alleged that Green Acres never acquired valid title to the subject property, much less, can it
claim to be an innocent purchaser for value. She further averred that a declaratory
judgment in a petition to quiet title will effectively subject the DARAB decision to review.
After Green Acres presented its evidence, Cabral led a Demurrer to Plaintiff's
Evidence 1 9 arguing that Green Acres failed to prove that it is a purchaser in good faith and
for value. She maintains that the complaint is not appropriate for quieting of title since it
omitted to assail her titles over the subject property but instead questioned the
proceedings held at the DARAB. She likewise insisted that the trial court has no jurisdiction
over the subject property since the same is still within the coverage of the Comprehensive
Agrarian Reform Law and thus under the jurisdiction of the DARAB.
In an Order 2 0 dated November 3, 2004, the trial court granted the demurrer and
ordered the case dismissed.
Green Acres' motion for reconsideration having been denied, Green Acres led with
the CA an appeal which was docketed as CA-G.R. CV No. 85766.
In the meantime, the DARAB decision became nal and executory on April 13, 2005
2 1 as no further recourse was sought by the Spouses Moraga from the denial of their
motion for reconsideration on February 24, 2005. 2 2 On July 8, 2005, Cabral led with the
PARAD a Motion for Issuance of Writ of Execution 2 3 of the DARAB decision.
On January 25, 2006, the PARAD issued a Resolution denying the Motion for
Issuance of Writ of Execution for lack of merit. It ruled:
Only the decision of the Board as embodied in the dispositive portion of
the decision can be implemented by virtue of a writ of execution. The January 17,
2001 decision merely orders the cancellation of the Emancipation Patent and
Transfer Certi cate of Titles issued by the Registry of Deed[s] of Bulacan in favor
of Sps. MORAGA and FILCON. Hence, if ever a Writ of Execution will be issued, it
will be up to the FILCON which was included in the dispositive portion of the
Decision that has become final and executory. Nothing in the body of the decision
as well as the dispositive portion thereof directs the cancellation of the title issued
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 in favor of GREEN ACRES. If we subscribe to the prayer of the movant, we will be
in effect amending the aforementioned decision because we will be inserting
something that has not been directed to be done. . . .
xxx xxx xxx

Aside from amending the nal and executory decision in this case, this
Forum will also be violating the generally accepted principle of due process. It is
already settled that even the administrative arm of the government exercising
quasi-judicial functions are not exempt from observing due process. . . .
xxx xxx xxx

It is clear as the sun rises from the east that GREEN ACRES was never
made a party in the case at bar. Much less was it mentioned in the decision
sought to be executed itself. GREEN ACRES can not be made to suffer the
consequences of a case where it did not participate.

xxx xxx xxx

Lastly, to allow movants['] contention will also render the pending case of
quieting of title led by GREEN ACRES against herein plaintiff movant on April 18,
2001 before the Regional Trial Court, Third Judicial Region, Branch 84 and
docketed as Civil Case 279-M-2001 which was appealed to the Court of Appeals,
moot and academic.
All told, the titles of Sps. MORAGA and FILCON sought to be cancelled in
the decision ha[ve] already been cancelled. Therefore, there is nothing to be done
anymore, as the relief prayed for has become fait accompli. 2 4

Cabral led a Motion for Recusation 2 5 and a Motion for Reconsideration. 2 6 The
PARAD, however, denied Cabral's motions on September 11, 2006. 2 7 Thus, on November
7, 2006, Cabral filed with the PARAD a Notice of Appeal. 2 8
In the meantime, the CA, on November 24, 2006, rendered a decision in CA-G.R. CV
No. 85766 dismissing Green Acres' appeal. Citing the case of Foster-Gallego v. Spouses
Galang, 2 9 the appellate court held that the trial court had no authority to interfere with the
proceedings of a court of equal jurisdiction, much less to annul the nal judgment of a co-
equal court. The appellate court further held that the only issue in an action to quiet title is
whether there is a cloud in a title to real property because of any instrument, record, claim,
encumbrance or a proceeding that has a prima facie appearance of validity and the DARAB
decision does not fall within said enumeration.
On February 27, 2007, the PARAD issued an Order 3 0 denying due course to Cabral's
Notice of Appeal and held that the resolution denying the motion for execution is an
interlocutory order against which the remedy is a petition for certiorari under Rule 65, and
not an appeal to the DARAB. The PARAD further ruled that Cabral's act of impleading Green
Acres as additional defendant only in the execution stage is highly irregular and that to
enforce the decision against Green Acres would violate the latter's right to due process.
On June 18, 2007, Cabral led with the CA a petition for certiorari under Rule 65
seeking to annul the January 25, 2006 and September 11, 2006 Resolutions, as well as the
February 27, 2007 Order of the PARAD.
On February 27, 2008, the CA denied Cabral's petition. The appellate court
ratiocinated as follows:
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 An execution can only be issued against a party and not against one who
did not have his day in court . . . . Green Acres was never a party to the case nor it
was (sic) mentioned in the decision sought to be executed, hence, Green Acres
cannot be made to suffer the consequences of a case where it did not participate.
To maintain otherwise would be to ignore the constitutional prohibition against
depriving a person of his property without due process of law . . . .
Moreover, to apply the decision against Green Acres will amount to
collateral attack against its titles because nowhere in the case or decision that it
was considered or passed upon. Under the Property Registration Decree, titles
issued under the Torrens system can only be altered, modi ed or cancelled in
direct proceeding in accordance with law . . . .
Even assuming that spouses Moraga and Filcon fraudulently acquired the
disputed lots, still, Green Acres has valid and legitimate titles over the same since
it is a purchaser in good faith and for value when it acquired the properties from
Filcon. A buyer in good faith is one who buys the property of another without
notice that some other person has a right to or interest in such property . . . . 3 1
(Citations omitted.)

Both Green Acres and Cabral are now before this Court seeking the reversal of the
CA decisions adverse to them.
In G.R. No. 175542, Green Acres contends that the CA erred in:
. . . RULING THAT THE DARAB DECISION IS NOT A SOURCE OF A CLOUD THAT
IS SUSCEPTIBLE TO AN ACTION FOR QUIETING OF TITLE.
. . . HOLDING THAT THE COURT DOES NOT HAVE AUTHORITY TO QUIET
TITLES TO REAL PROPERTY AND REMOVE A CLOUD PRODUCED BY A DARAB
DECISION.

. . . AFFIRMING THE ORDER OF THE [REGIONAL TRIAL COURT] DATED

NOVEMBER 3, 2004 THEREBY IMPLIEDLY HOLDING THAT GREEN ACRES IS
NOT A PURCHASER IN GOOD FAITH FOR VALUE; THUS, ITS TITLE CAN NOT BE
QUIETED. 3 2

In G.R. No. 183205, Cabral, on the other hand, argues that the CA erred when it:
. . . FAILED TO CORRECTLY APPLY THE PERTINENT PROVISIONS OF THE
DARAB 2003 RULES OF PROCEDURE, P.D. 1529 AND THE CIVIL CODE, AMONG
OTHERS, AS WELL AS THE APPLICABLE JURISPRUDENCE.
. . . DISMISSED PETITIONER'S PETITION FOR CERTIORARI.

. . . FAILED TO RULE THAT THERE WAS GRAVE ABUSE OF DISCRETION

AMOUNTING TO LACK OF OR ABUSE OF DISCRETION ON THE PART OF
PUBLIC RESPONDENT PROVINCIAL ADJUDICATOR LONGBOAN.
. . . DECLARED THAT THE DECISION PROMULGATED ON JANUARY 17, 2001
CANNOT BE MADE TO APPLY TO RESPONDENT GREEN ACRES.

. . . DECLARED THAT (SIC) RESPONDENT GREEN ACRES TO BE AN "INNOCENT

PURCHASER FOR VALUE." 3 3

Simply put, the issues raised in the two petitions are essentially as follows: (1)
Whether the January 17, 2001 DARAB decision may be enforced against Green Acres; and
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 (2) Whether the said DARAB decision in favor of Cabral constitutes a cloud on Green Acres'
title over the subject properties.
First Issue: Whether the January 17,
2001 DARAB decision may be
enforced against Green Acres.
Cabral contends that the PARAD committed grave abuse of discretion in not issuing
the writ of execution to enforce the January 17, 2001 DARAB decision in her favor. She
argues that the issuance of a writ of execution is ministerial under Section 1, Rule XX of the
2003 DARAB Rules of Procedure which provides that the execution of a nal order or
decision shall issue as a matter of course.
Cabral also argues that contrary to the PARAD's ruling, she is not seeking the
amendment of the nal decision sought to be executed. She contends that the directive to
the Register of Deeds to restore TCT No. T-73737 (M) in her name means that it should be
done regardless of who holds title to the property at the time of execution. In this case, it
is Green Acres. She also points out that the transfer from the Spouses Moraga to Filcon in
1996 and eventually to Green Acres in 1999 transpired after she led a case with the
DARAB in 1994. Therefore, under Section 12.2, Rule XX of the DARAB Rules, Green Acres is
considered a successor in interest by title subsequent to the commencement of the action
upon whom the nal judgment or order of the DARAB is conclusive. Cabral also insists that
Green Acres cannot be considered an innocent purchaser for value because the transfers
were made to defeat the DARAB ruling.
Green Acres, for its part, submits that the CA did not err in denying Cabral's petition
for certiorari. Green Acres contends that Cabral, through her motion for execution, sought
the amendment of the DARAB decision and did not move merely for its execution. Green
Acres points out that Cabral's motion for execution speci cally sought the cancellation of
Green Acres' titles even though the DARAB decision neither included Green Acres or its
titles. Green Acres points out that if the issuance of a writ of execution that conforms to
the decision may be denied on the ground that it will be inequitable, moreso should it be
denied in the case where the writ of execution prayed for goes beyond the decision. Hence,
even if the issuance of a writ of execution to enforce a nal and executory decision is a
ministerial duty, the PARAD may not issue a writ of execution against Filcon and Green
Acres as prayed for by Cabral.
Green Acres also argues that it cannot be bound by the DARAB decision since a writ
of execution of a decision can only be issued against a party to the case and not against
one who did not have his day in court. Moreover, if granted, the execution sought will
constitute a collateral attack against the titles of Green Acres since nowhere in the DARAB
decision sought to be executed were they mentioned. Green Acres also adds that Cabral
misinterpreted Section 12.2 of the DARAB Rules to mean that a judgment issued in a case
is binding upon, and can be executed, even against those parties not impleaded in the
case. Green Acres submits that Section 12 is a mere reproduction of Section 47, Rule 39
of the Rules of Court on the principle of res judicata. Thus, the cited DARAB rule does not
operate to bind Green Acres, either presently or in the future, to the DARAB decision which
does not mention Green Acres either in the body or the dispositive portion. Green Acres
likewise argues that impleading it as an additional defendant in the execution stage
aggravates the violation of its right to due process.
Green Acres further contends that Cabral's argument that it is not a purchaser in
good faith and for value may not be considered in the resolution of her petition before this
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 Court as her argument goes into the merits of the case and said matters were not raised in
her motion for execution. But even if the argument could be considered, Green Acres
claims that the merits of the case show that it is a purchaser in good faith and for value.
Green Acres points out that when it purchased the properties from Filcon, the properties
were covered by transfer certi cates of title, not Emancipation Patents, without any
indication that the titles had their origins from the application of any agrarian law. Green
Acres also adds that the occupancy or possession of the properties of both Filcon and
Green Acres were not clandestine as Cabral claims. Neither can it be true, as Cabral
claimed, that its acquisition of the titles to the properties was made through "surreptitious
and illegal transfers." Green Acres argues that Cabral must have known about the alleged
illegal subdivision of the property and issuance of the transfer certi cates of titles or
Emancipation Patents, or if she did not know, she is nonetheless deemed to have received
constructive notice of the same because the properties were registered under the Torrens
System. Yet, despite said notice, Cabral, with gross negligence, failed to annotate a notice
of lis pendens on said titles.
We find in favor of Green Acres.
The principle that a person cannot be prejudiced by a ruling rendered in an action or
proceeding in which he was not made a party conforms to the constitutional guarantee of
due process of law. 3 4 In Muñoz v. Yabut, Jr., 3 5 this Court ruled:
An action for declaration of nullity of title and recovery of ownership of real
property, or re-conveyance, is a real action but it is an action in personam, for it
binds a particular individual only although it concerns the right to a tangible
thing. Any judgment therein is binding only upon the parties properly
impleaded.
Since they were not impleaded as parties and given the opportunity to
participate in Civil Case No. Q-28580, the nal judgment in said case cannot bind
BPI Family and the spouses Chan. The effect of the said judgment cannot be
extended to BPI Family and the spouses Chan by simply issuing an alias writ of
execution against them.No man shall be affected by any proceeding to
which he is a stranger, and strangers to a case are not bound by any
judgment rendered by the court. In the same manner, a writ of execution
can be issued only against a party and not against one who did not
have his day in court. Only real parties in interest in an action are
bound by the judgment therein and by writs of execution issued
pursuant thereto . 3 6 (Emphasis supplied.)

It is beyond dispute that Green Acres was not made a party in the DARAB case.
Consequently, the January 17, 2001 DARAB decision cannot bind Green Acres. Likewise,
the binding effect of the DARAB decision cannot be extended to Green Acres by the mere
issuance of a writ of execution against it. No one shall be affected by any proceeding to
which he is a stranger, and strangers to a case are not bound by any judgment rendered by
the court. In the same manner, a writ of execution can be issued only against a party and
not against one who did not have his day in court. Only real parties in interest in an action
are bound by the judgment therein and by writs of execution and demolition issued
pursuant thereto. 3 7
Moreover, a Torrens title, as a general rule, is irrevocable and indefeasible, and the
duty of the court is to see to it that this title is maintained and respected unless challenged
in a direct proceeding. Section 48 of P.D. No. 1529 provides:
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 SEC. 48. Certi cate not subject to collateral attack. — A certi cate of
title shall not be subject to collateral attack. It cannot be altered, modi ed,
or cancelled except in a direct proceeding in accordance with law. (Emphasis
supplied.)

I n Sps. Sarmiento v. Court of Appeals, 3 8 this Court explained when an action is a

direct attack on a title and when it is collateral:
An action is deemed an attack on a title when the object of the action or
proceeding is to nullify the title, and thus challenge the judgment pursuant to
which the title was decreed. The attack is direct when the object of the action is to
annul or set aside such judgment, or enjoin its enforcement. On the other hand,
the attack is indirect or collateral when, in an action to obtain a different relief, an
attack on the judgment is nevertheless made as an incident thereof. 3 9

In the instant case, Cabral seeks the execution of a nal and executory DARAB
decision that directs the cancellation of the TCTs in the name of the Spouses Moraga and
Filcon. Nowhere in the said decision is Green Acres or its TCTs mentioned. Nonetheless, in
her Motion for Issuance of Writ of Execution, Cabral alleged that Green Acres, like Filcon,
"also never acquired valid title to the subject land" and "[h]ence, its present TCTs thereto
should likewise be cancelled (together with the respective [Emancipation Patents] and
TCTs of Sps. Moraga and Filcon Ready Mixed, Inc. mentioned in the DARAB Decision) and
reverted back to [her] TCT." 4 0 She prayed for the issuance of a writ of execution against
the Spouses Moraga and "their subsequent assigns/successors in interest Filcon Ready
Mixed, Inc. and Green Acres Holdings, Inc." 4 1 Clearly, seeking the cancellation of the titles
of Green Acres by a mere Motion for Issuance of Writ of Execution of a decision rendered
in a case where said titles were not in issue constitutes a collateral attack on them which
this Court cannot allow.
Furthermore, as correctly ruled by the PARAD and upheld by the appellate court, only
the decision of the DARAB as embodied in the dispositive portion of the decision can be
implemented by a writ of execution. As held in Ingles v. Cantos: 4 2
A writ of execution should conform to the dispositive portion of the
decision to be executed, and the execution is void if it is in excess of and beyond
the original judgment or award, for it is a settled general principle that a writ of
execution must conform strictly with every essential particular of the judgment
promulgated. It may not vary the terms of the judgment it seeks to enforce. Nor
may it go beyond the terms of the judgment sought to be executed. Where the writ
of execution is not in harmony with and exceeds the judgment which gives it life,
the writ has pro tanto no validity. 4 3

A reading of the fallo of the DARAB decision would show that nothing in it directs
the cancellation of the titles issued in favor of Green Acres. To subscribe to Cabral's prayer
in her motion is tantamount to modifying or amending a decision that has already attained
finality in violation of the doctrine of immutability of judgment.
It is also worth noting that the fact that the DARAB by nal judgment ordered the
cancellation of the titles of the Spouses Moraga and Filcon does not automatically make
the titles of Green Acres null and void. It is settled that a void title may be the source of a
valid title in the hands of an innocent purchaser for value. 4 4 An innocent purchaser for
value is one who, relying on the certi cate 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
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 notice of the claim or interest of some other person in the property. 4 5 The rationale
therefor was expressed by this Court in the earlier case of Republic v. Court of Appeals, 4 6
thus:
Where innocent third persons, relying on the correctness of the certi cate
of title thus issued, acquire rights over the property the court cannot disregard
such rights and order the total cancellation of the certi cate. The effect of such
an outright cancellation would be to impair public con dence in the certi cate of
title, for everyone dealing with property registered under the Torrens system would
have to inquire in every instance whether the title has been regularly or irregularly
issued. This is contrary to the evident purpose of the law. Every person dealing
with registered land may safely rely on the correctness of the certi cate of title
issued therefor and the law will in no way oblige him to go behind the certi cate
to determine the condition of the property. . . . 4 7

Green Acres is considered an innocent purchaser for value. It relied on the

certi cates of title of Filcon, free from any liens and encumbrances. The only annotation on
them was a cancelled real estate mortgage in favor of PCI Bank. Thus, as held by the CA,
Green Acres was under no obligation to investigate beyond Filcon's titles as Green Acres
had all the reason to believe that said titles were free from any lien, claim or encumbrance.
We also agree with the CA that Cabral's allegation that the Spouses Moraga, Filcon
and Green Acres were parties to illegal contracts cannot be given weight as such goes into
the merits of the case and may not be considered in the execution stage.
If there is anyone to be blamed for Cabral's failure to recover the subject properties,
it is Cabral herself, who, due to her own negligence, failed to annotate a notice of lis
pendens on the titles of the Spouses Moraga and Filcon and thus give notice to future
transferees. She cannot claim that she was clueless that the subject properties were being
transferred. As Green Acres correctly pointed out, the transfers to Filcon and eventually to
Green Acres were made through public documents and procedures. Also, considering the
signi cant size of the properties, occupation of the same cannot be made clandestinely. In
fact, the properties were fenced by concrete walls and Filcon had constructed a batch
plant while Green Acres erected a warehouse and building on it. Had her adverse claim
been annotated on said titles, said notice would have served as a warning to Green Acres
or other purchasers of the properties that any right they acquire would be subject to the
outcome of the litigation before the DARAB. Having failed to make such annotation, this
Court has no choice but to uphold the titles of Green Acres, an innocent purchaser for
value.
Whether the DARAB Decision in
favor of Cabral constitutes a cloud
on Green Acres' title over the subject
properties
Green Acres argues that the DARAB decision is among those enumerated in Article
4 7 6 4 8 of the Civil Code as a possible source of a cloud on title to real property. It
contends that there can hardly be any doubt that the DARAB Decision is an "instrument," or
if not, a "record" and re ects a "claim" on the properties, while the proceedings before the
DARAB are "proceedings" directed at the real properties now owned by Green Acres which
are "apparently valid or effective" but "unenforceable" against the titles of Green Acres. It
also contends that the appellate court's reliance on Foster-Gallego v. Spouses Galang 4 9 is
misplaced since nothing in said case supports the proposition that a decision of a
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 coordinate court cannot be a source of cloud under Article 476 of the Civil Code. Green
Acres submits that Foster-Gallego is not applicable because the ruling there was that an
action to quiet title is not the proper remedy when to remove a cloud on a title, a nal and
executory decision of the court need to be reviewed or vacated. In the present case, Green
Acres does not seek a review or reversal of the DARAB decision.
Cabral, for her part, insists that the DARAB decision is not among those enumerated
in Article 476 which may cast a cloud on title to real property. As to the applicability of
Foster-Gallego, she argues that assuming that the ruling on the main issue in said case is
not directly germane, the pronouncements therein on the nature, function, purpose and
limitations of a case for quieting of title and the power of the courts in such proceedings
are applicable.
Green Acres' arguments are meritorious.
Article 476 of the Civil Code provides:
Art. 476. Whenever there is a cloud on title to real property or any
interest therein, by reason of any instrument, record, claim, encumbrance or
proceeding which is apparently valid or effective but is in truth and in fact invalid,
ineffective, voidable, or unenforceable, and may be prejudicial to said title, an
action may be brought to remove such cloud or to quiet the title.

An action may also be brought to prevent a cloud from being cast upon
title to real property or any interest therein.

Quieting of title is a common law remedy for the removal of any cloud upon, doubt,
or uncertainty affecting title to real property. Whenever there is a cloud on title to real
property or any interest in real property by reason of any instrument, record, claim,
encumbrance, or proceeding that is apparently valid or effective, but is in truth and in fact,
invalid, ineffective, voidable, or unenforceable, and may be prejudicial to said title, an action
may be brought to remove such cloud or to quiet the title. In such action, the competent
court is tasked to determine the respective rights of the complainant and the other
claimants, not only to place things in their proper places, and make the claimant, who has
no rights to said immovable, respect and not disturb the one so entitled, but also for the
bene t of both, so that whoever has the right will see every cloud of doubt over the
property dissipated, and he can thereafter fearlessly introduce any desired improvements,
as well as use, and even abuse the property. 5 0
For an action to quiet title to prosper, two indispensable requisites must concur: (1)
the plaintiff or complainant has a legal or equitable title or interest in the real property
subject of the action; and (2) the deed, claim, encumbrance, or proceeding claimed to be
casting a cloud on his title must be shown to be in fact invalid or inoperative despite its
prima facie appearance of validity or legal efficacy. 5 1
There is no dispute as to the rst requisite since Green Acres has legal title over the
subject properties. The issue lies in the second requisite.
A cloud on title consists of (1) any instrument, record, claim, encumbrance or
proceeding; (2) which is apparently valid or effective; (3) but is in truth and in fact invalid,
ineffective, voidable, or unenforceable; and (4) may be prejudicial to the title sought to be
quieted. 5 2
This Court holds that the DARAB decision in favor of Cabral satis es all four
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 elements of a cloud on title.
As Green Acres correctly points out, the DARAB decision, a nal one at that, is both
an "instrument" and a "record." Black's Law Dictionary defines an instrument as a document
or writing which gives formal expression to a legal act or agreement, for the purpose of
creating, securing, modifying or terminating a right. 5 3 A record, on the other hand, is
de ned as a written account of some act, court proceeding, transaction or instrument
drawn up under authority of law, by a proper o cer, and designed to remain as a memorial
or permanent evidence of the matters to which it relates. 5 4 It is likewise a "claim" which is
de ned as a cause of action or a demand for money or property 5 5 since Cabral is
asserting her right over the subject lots. More importantly, it is a "proceeding" which is
de ned as a regular and orderly progress in form of law including all possible steps in an
action from its commencement to the execution of judgment and may refer not only to a
complete remedy but also to a mere procedural step that is part of a larger action or
special proceeding. 5 6
Also, the DARAB decision is apparently valid and effective. It is a nal decision that
has not been reversed, vacated or nulli ed. It is likewise apparently effective and may be
prejudicial to Green Acres' titles since it orders the cancellation of the titles of the Spouses
Moraga and Filcon all from which Green Acres derived its titles. However, as discussed
above, it is ineffective and unenforceable against Green Acres because Green Acres was
not properly impleaded in the DARAB proceedings nor was there any notice of lis pendens
annotated on the title of Filcon so as to serve notice to Green Acres that the subject
properties were under litigation. As such, Green Acres is an innocent purchaser for value.
Furthermore, in the case of Dare Adventure Farm Corporation v. Court of Appeals, 5 7
this Court had the occasion to rule that one of the proper remedies of a person who was
not impleaded in the proceedings declaring null and void the title from which his title to the
property had been derived, is an action for quieting title. In said case, Dare Adventure Farm
Corporation purchased property from the Goc-ongs. Dare later discovered that said
property was previously mortgaged by the Goc-ongs to the Ngs. When the Goc-ongs failed
to pay their obligation, the mortgage was foreclosed and the Ngs were declared owners of
the property. Dare, who was not impleaded in the foreclosure case, led a petition for
annulment of the judgment of the trial court with the appellate court. The Court upheld the
appellate court's dismissal of the petition since such remedy may be availed only when
other remedies are wanting. We further ruled that Dare's resort to annulment of judgment
was unnecessary since it cannot be prejudiced by the judgment as it was not impleaded.
Two remedies were suggested to Dare as proper recourse, one of which is an action for
quieting of title:
We agree with the CA's suggestion that the petitioner's proper recourse was
either an action for quieting of title or an action for reconveyance of the property.
It is timely for the Court to remind that the petitioner will be better off if it should
go to the courts to obtain relief through the proper recourse; otherwise, it would
waste its own time and effort, aside from thereby unduly burdening the dockets of
the courts.
The petitioner may vindicate its rights in the property through an action for
quieting of title, a common law remedy designed for the removal of any cloud
upon, or doubt, or uncertainty affecting title to real property. The action for
quieting of title may be brought whenever there is a cloud on title to real property
or any interest in real property by reason of any instrument, record, claim,
encumbrance, or proceeding that is apparently valid or effective, but is, in truth
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 and in fact, invalid, ineffective, voidable, or unenforceable, and may be prejudicial
to said title. In the action, the competent court is tasked to determine the
respective rights of the plaintiff and the other claimants, not only to put things in
their proper places, and make the claimant, who has no rights to the immovable,
respect and not disturb the one so entitled, but also for the bene t of both, so that
whoever has the right will see every cloud of doubt over the property dissipated,
and he can thereafter fearlessly introduce any desired improvements, as well as
use, and even abuse the property. 5 8

WHEREFORE, the petition in G.R. No. 175542 is G RANTE D. The Decision dated
November 24, 2006 of the Court of Appeals in CA-G.R. CV No. 85766 is REVERSED and
SET ASIDE. TCT Nos. T-345660 (M), T-345661 (M) and T-345662 (M) registered in the
name of Green Acres Holdings, Inc. are declared VALI D and any cloud over such titles
which may have been created by the Decision dated January 17, 2001 of the Department
of Agrarian Reform Adjudication Board in DARAB Case No. 5129 (Reg. Case No. 739-Bul-
94) is hereby REMOVED.
The petition in G.R. No. 183205 is DE NI E D for lack of merit. The Decision dated
February 27, 2008 and Resolution dated May 29, 2008 of the Court of Appeals in CA-G.R.
SP No. 99651 are AFFIRMED.
With costs against the petitioner in G.R. No. 183205.
SO ORDERED.
Sereno, C.J., Leonardo-de Castro, Bersamin and Reyes, JJ., concur.

Footnotes

1.Rollo (G.R. No. 175542), pp. 163-172. Penned by Associate Justice Jose L. Sabio, Jr. with
Associate Justices Rosalinda Asuncion Vicente and Ramon M. Bato, Jr. concurring.

2.Records, pp. 670-674. Penned by Presiding Judge Wilfredo T. Nieves.

3.Rollo (G.R. No. 183205), pp. 62-71. Penned by Associate Justice Juan Q. Enriquez, Jr. with
Associate Justices Vicente S.E. Veloso and Marlene Gonzales-Sison concurring.

4.Id. at 73-74.
5.The appeal was docketed as DARAB Case No. 5129 (Reg. Case No. 739-Bul-94).

6.Rollo (G.R. No. 183205), p. 397.

7.Id. at 398.

8.Id. at 399.

9.See Entry No. 418076 (M) annotated on TCT Nos. T-274486 (M), T-274487 (M) and T-274488
(M).
10.See Entry Nos. 315804 (M) and 418588 (M) on TCT Nos. T-274486 (M), T-274487 (M) and
T-274488 (M).

11.Rollo (G.R. No. 183205), p. 402.

12.Id. at 403.

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 13.Id. at 404.
14.Records, pp. 52-53.

15.Id. at 54-55.
16.Id. at 56.

17.Id. at 3-22.

18.Id. at 255-271.
19.Id. at 602-621.

20.Id. at 670-674.
21.Rollo (G.R. No. 183205), p. 108.

22.Id. at 95-96.

23.Id. at 97-104.
24.Id. at 109-111.

25.Id. at 122-131.
26.Id. at 113-121.

27.Id. at 132-139.

28.Id. at 140-142.
29.479 Phil. 148 (2004).

30.Rollo (G.R. No. 183205), pp. 145-149.

31.Id. at 68-69.
32.Rollo (G.R. No. 175542), pp. 40-41.

33.Rollo (G.R. No. 183205), pp. 35-36.

34.Dare Adventure Farm Corporation v. Court of Appeals, G.R. No. 161122, September 24, 2012,
681 SCRA 580, 588.

35.G.R. Nos. 142676 & 146718, June 6, 2011, 650 SCRA 344.
36.Id. at 367-368.

37.Orquiola v. Court of Appeals, 435 Phil. 323, 332-333 (2002).

38.507 Phil. 101 (2005).

39.Id. at 113.

40.Rollo (G.R. No. 183205), p. 102.

41.Id. at 103.

42.516 Phil. 496 (2006).

43.Id. at 506.

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 44.Tan v. De la Vega, 519 Phil. 515, 529 (2006).

45.San Roque Realty and Development Corporation v. Republic, G.R. No. 163130, September 7,
2007, 532 SCRA 493, 511-512.

46.G.R. No. 99331, April 21, 1999, 306 SCRA 81.

47.Id. at 88-89.
48.Art. 476. Whenever there is a cloud on title to real property or any interest therein, by
reason of any instrument, record, claim, encumbrance or proceeding which is apparently
valid or effective but is in truth and in fact invalid, ineffective, voidable, or unenforceable,
and may be prejudicial to said title, an action may be brought to remove such cloud or to
quiet the title.
  An action may also be brought to prevent a cloud from being cast upon title to real
property or any interest therein.

49.Supra note 29.

50.Phil-Ville Development and Housing Corporation v. Bonifacio, G.R. No. 167391, June 8, 2011,
651 SCRA 327, 341, citing Heirs of Enrique Toring v. Heirs of Teodosia Boquilaga, G.R.
No. 163610, September 27, 2010, 631 SCRA 278, 293-294.

51.Eland Philippines, Inc. v. Garcia, G.R. No. 173289, February 17, 2010, 613 SCRA 66, 92.
52.Phil-Ville Development and Housing Corporation v. Bonifacio, supra note 50, at 347.

53.H.C. BLACK, BLACK'S LAW DICTIONARY 720 (5th ed., 1979).

54.Id. at 1144.
55.Id. at 224.

56.Id. at 1083.
57.Supra note 34.

58.Id. at 590.

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