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RUBEN C. REYES v. TANG SOAT ING

FACTS:

This case involves a complaint for Enforcement of Easement and Damages filed by MFR Farms, Inc. against respondents Tang Soat Ing and Ando Sy. MFR Farms complained of respondents' commercial and industrial use of their property covered by Transfer Certificate of Title (TCT) No. T-198753, and sought the enforcement of the encumbrance contained in their title. The Regional Trial Court (RTC) granted MFR's complaint and ordered respondents to cease their industrial or commercial activities on the property and pay damages. The Court of Appeals affirmed with modification the RTC's ruling. MFR obtained a Writ of Execution and the Sheriff submitted a Sheriff's Report stating that the respondents were not complying with the obligations under the Writ of Execution. Eventually, the Notice of Levy on Execution of Real Property was inscribed on the title of the property.

MFR obtained a judgment against respondents and levied and attached the property covered by TCT No. T-198753. The Notice of Levy was inscribed on the said title. MFR conducted a public auction and emerged as the highest bidder. A Certificate of Sale was issued and registered with the Register of Deeds. After respondents failed to exercise their right of redemption, MFR filed a motion with the RTC requesting the cancellation of the title and the issuance of a new certificate of title. The RTC denied the motion, stating that a petition and hearing are required for the issuance of a new certificate of title. MFR filed a new Petition impleading the Register of Deeds as an additional defendant. Respondents failed to file an Answer or any responsive pleading. MFR moved to declare respondents in default. MFR presented evidence ex-parte and filed a Motion for Substitution of Party Petitioner. The RTC granted the Petition and directed respondents to surrender the owner's duplicate copy of the title. Reyes filed another Motion seeking the cancellation of the title and the issuance of a new one in his name. Respondents opposed the motion and moved to declare the sale void. The RTC denied respondents' opposition and motion. Respondents filed a Motion for Reconsideration, which the RTC denied.

Respondents filed a petition for certiorari before the Court of Appeals seeking to nullify the trial court's orders and declare void the execution proceedings and the cancellation of the title. The Court of Appeals annulled the RTC's orders, declaring the auction sale and the certificate of sale as null and void. Reyes, the petitioner, filed a motion for reconsideration which was denied by the Court of Appeals.

ISSUES:

  1. Whether the burden of evidence to prove lack of compliance with Section 15, Rule 39 of the Rules of Court rests on the party claiming lack thereof.

  2. Whether there was substantial compliance with Section 15, Rule 39 of the Rules of Court in terms of notice requirements for the execution sale.

  3. Whether the respondents' attack on the validity of the execution proceedings is barred by laches.

  4. Whether respondents are estopped and barred from assailing the execution proceedings before the RTC.

  5. Whether there was substantial compliance by the Sheriff with Section 15(c), Rule 39 of the Rules of Court.

  6. Whether respondents' claim of lack of notice of the execution proceedings can invalidate the enforcement and execution of a final and executory judgment.

  7. Whether the filing of a separate and original action before the RTC is necessary for the titling of the subject property in Reyes' name.

  8. Whether Section 78 of Act 496 or Section 75 of PD 1529 applies in the petition for new certificate of title.

  9. Whether the respondent can file a separate cadastral action for the issuance of new titles.

RULING:

  1. The burden of evidence to prove lack of compliance with Section 15, Rule 39 of the Rules of Court rests on the party claiming lack thereof. The party alleging lack of compliance with the posting and publication requirements of the auction sale is required to prove such allegation. The duty to prove the truth of a negative lies upon the party who asserts the existence of that negative, unless the matter is peculiarly within the knowledge of the adverse party. In this case, the burden of proof relied solely on the defendants to prove that the posting and publication requirements were not complied with.

  2. There was substantial compliance with Section 15, Rule 39 of the Rules of Court in terms of notice requirements for the execution sale. The documents presented, such as the Certificate of Posting issued by Sheriff Legaspi and the Affidavit of Publication executed by the publisher of The Times Newsweekly, show that posting and publication of notices were made. The purpose of giving notice through posting and publication was fulfilled, as the public was informed of the sale, allowing for the possibility of obtaining the best price or better bids and minimizing prejudice to the judgment debtor.

  3. The attack on the validity of the execution proceedings is barred by laches. Laches is the failure or neglect, for an unreasonable and unexplained length of time, to do what could or should have been done earlier. It operates as a bar in equity. The respondents failed to respond to the processes of the RTC in the execution proceedings for more than five years, and even after receiving notice of the execution sale of their property. Therefore, their attack on the validity of the execution proceedings is barred by laches.

  4. The respondents are estopped and barred from assailing the execution proceedings before the RTC. Their claim of ignorance of the execution proceedings is contradicted by the documents on record. They had notice of the execution proceedings and the proceedings on the issuance of a new title over the subject property. Their failure to act on these notices and their attempt to nullify the execution proceedings is deemed an afterthought and a last-ditch effort to evade payment of their judgment debt. They are estopped from questioning the validity of the proceedings.

  5. The Supreme Court held that there was no substantial compliance by the Sheriff with Section 15(c), Rule 39 of the Rules of Court.

  6. The Supreme Court ruled that respondents' claim of lack of notice of the execution proceedings is belied by the evidence on record and cannot invalidate the enforcement and execution of a final and executory judgment.

  7. The Supreme Court held that the filing of a separate and original action before the RTC is necessary for the titling of the subject property in Reyes' name.

  8. The Court held that Section 75 of PD 1529 applies in the case instead of Section 78 of Act 496, as it provides the solution to the respondent's predicament. The Court emphasized that PD 1529 provides due process to a registered landowner and prevents fraudulent or mistaken conveyance of land.

  9. The Court ruled that the respondent can file a separate cadastral action for the issuance of new titles in its name. The Court stated that the respondent should have followed the proper procedure for the issuance of new certificates of title.

PRINCIPLES:

  • The burden of evidence lies on the party claiming lack of compliance with the posting and publication requirements of an execution sale.

  • The duty to prove the truth of a negative lies upon the party who asserts the existence of that negative, unless the matter is peculiarly within the knowledge of the adverse party.

  • Laches operates as a bar in equity when there is failure or neglect to do what could or should have been done within a reasonable time, warranting a presumption of abandonment or decline to assert a right.

  • Relief will be denied to a litigant who has acquiesced for an unreasonable length of time, or who has not been vigilant or has slept on his rights by negligence or inattention. Claims grown stale for non-assertion are discouraged for the peace of society.

  • Once a judgment becomes final and executory, the prevailing party should not be denied the fruits of his victory by subterfuge devised by the losing party. The losing party is estopped from assailing the validity of the proceedings after keeping silent for a long time and is bound by the action or inaction of their former counsel.

  • The statutory requirements of posting and publication must be strictly complied with in execution sales of real property under Rule 39 of the Rules of Court. Non-compliance could constitute a jurisdictional defect that would invalidate the sale.

  • The claim of lack of notice of the execution proceedings cannot invalidate the enforcement and execution of a final and executory judgment if it is belied by the evidence on record.

  • Section 107 of Presidential Decree No. 1529 contemplates the filing of a separate and original action before the RTC, acting as a land registration court, for the issuance of a new certificate of title.

  • The jurisdiction of the court to execute its judgment continues even after the judgment has become final for the purpose of enforcement of judgment.

  • The subsequent filing of a separate and original action for the titling of the subject property in the name of the purchaser in an execution sale no longer involves the execution of the judgment.

  • The law provides due process to a registered landowner and prevents fraudulent or mistaken conveyance of land.

  • Proper procedure must be followed for the issuance of new certificates of title.

  • A separate cadastral action can be filed for the issuance of new titles.