80.

Yabut Lee vs Punzalan

Facts: On May 14, 1968, applicants-appellees had filed before the CFI Tarlac an application for the
registration of 2 parcels of land. No opposition having been interposed despite due publication, the trial
Court issued an Order of General Default. The applicants presented their evidence but due to the
transfer of then Presiding Judge Julian E. Lustre to another district, the Application was unacted upon.

On November 26, 1968, appellant Florencio Punzalan filed a "Petition for Reopening and/or Review" on
the claim that applicants had committed fraud in not disclosing in their Application that he is the owner
of a house standing on the lots applied for, that he has usufructuary rights over said properties, and
prayed that the Petition be admitted, the case reopened and a new trial ordered. Applicants objected to
the Petition interposing the defense of prescription.

Trial Court denied the Petition since there is nothing to reopen and/or review at the moment. Punzalan
appealed. Applicants filed a Motion to Dismiss before said Appellate Court.

Issue: WON oppositor-appellant has a perfect legal right to file his petition for reopening and/or for
review when no decision adjudicating the parcels of land in question has been rendered nor has a final
decree of registration issued.

Ruling: Yes. In the case at bar, no judgment has as yet been rendered by the lower Court, and much
less has any decree of registration been issued. But while appellant had definitely committed an error of
procedure, it was evident that his objective was to be given a chance to present evidence to
substantiate his allegations of ownership. In fact, he had asked for new trial. The interests of substantial
justice and the speedy determination of the controversy, therefore, should have impelled the trial Court
to lift the Order of General Default in respect of oppositor-appellant, and once lifted, to have allowed
appellant to file an Opposition to the Application. Thereby, appellant could have been afforded the
opportunity to present his evidence challenging applicants' right to registration.

Order of General Default is set aside and case was remanded to the trial court for judgment.

81. Gonzaga vs CA

Facts: Jose Eugenio had once been the registered owner of lot nos. 3619 and 3620. Eugenio sold the
two lots to deceased defendant Luis J. Gonzaga. A new TCT was issued in the name of Gonzaga. On
September 28, 1981, Gonzaga sold the two lots to petitioner Mascariñas. Consequently, a new TCT
was issued in the name of Mascariñas

However, another subsisting Torrens title covers the same two lots in the name of private respondent
Lilia Sevilla married to Jose Seelin. October 14, 1981, respondents filed a complaint for annulment of
Gonzaga's Torrens title. Gonzaga asserted that since he had already sold and conveyed the subject
lots to petitioner Mascariñas, private respondents no longer have any cause of action against him.
Consequently, private respondents filed an amended complaint to include petitioner Mascariñas as
party-defendant.

The court a quo rendered judgment declaring private respondents' TCT as valid and legal and ordering
to cancel Gonzaga's and Mascariñas' TCT for being null and void.

Issue: WON the private respondents' title prevails over that of petitioners’
Ruling: Yes. There's a relevant distinction between private respondents' petitioners' titles as to their
origin. Petitioners' titles were registered under Cadastral Proceedings on May 3, 1917, whereas private
respondents' title, derived from the same Original Certificate of Title was registered April 19, 1917.
Where two certificates purport to include the same land, the earlier in date prevails. A certificate is not
conclusive evidence of title if it is shown that the same land has already been registered and an earlier
certificate for the same is in existence. Since the land in question has already been registered under
OCT No. 994 dated April 19, 1917, the subsequent registration is null and void.

82. Ignacio vs CA

Facts: On December 24, 1987, petitioner, in consideration of P1million, purchased under a pacto de
retro contract from private respondents a house and lot of 624 square meters located at Pasig, Metro
Manila. The property is registered in the name of Renato G. Yalung, married to Marina Toledano. The
parties agreed that private respondents be granted the right to repurchase the property sold within 90 days
from December 24, 1987, for the same consideration of P1million plus 5% interest thereon. Private
respondents failed to repurchase the property within the 90-day period despite an extension of five days
granted them. On April 19, 1988, petitioner filed with the RTC Pasig a petition for consolidation of ownership,
entitled "In Re: Petition to Consolidate Ownership Under Pacto de Retro Sale.

Private respondents filed a Manifestation admitting the execution of the "Deed of Sale under Pacto de
Retro." They claimed, however, that the parties only intended to enter into an equitable mortgage to secure
prompt payment of the loan given them by petitioner. They prayed for the dismissal of the petition or, in the
alternative, for the declaration of the deed of sale as an equitable mortgage. RTC rendered on August 9,
1988 a decision granting the petition. It found that both parties clearly and unquestionably intended a sale
under pacto de retro, not an equitable mortgage. It thus ordered the ROD of Rizal to cancel TCT and issue
another in the name of petitioner. However, CA reversed trial court's decision.

Issue: WON the "Deed of Sale Under Pacto de Retro" can be considered as an equitable mortgage

Ruling: No, the "Deed of Sale Under Pacto de Retro" cannot be considered as an equitable mortgage.
The mere fact that the price in a pacto de retro sale is not the true value of the property does not justify
the conclusion that the contract is one of equitable mortgage. In a pacto de retro sale, the practice is to
fix a relatively reduced price to afford the vendor a retro every facility to redeem the property. Moreover,
private respondents have not been in actual possession of the subject property. They had been leasing
it out at the time the deed was executed.

CA decision set aside and RTC decision is reinstated.