FACTS:

This case involves an action for annulment of deeds of sale, cancellation of title, and damages filed by petitioner Virgilio Cagatao against respondents Guillermo Almonte, Arthur Aguilar, Spouses Ernesto and Avelina Fernandez, and their children Marvin John Fernandez, Marson Fernandez, and Marjun Fernandez.

Cagatao claimed that he acquired ownership of the disputed property through a private written document executed in 1990, transferring ownership from Delfin Manzulin to him. According to Cagatao, Manzulin acquired the property from Juan Gatchalian through a barter agreement in 1940.

On the other hand, the respondents argued that they purchased the property from Almonte and Aguilar, who had possession of a tax declaration for the lot. The respondents also claimed that they later bought the property from Emmaculada Carlos, who held a reconstituted title in her name. A deed of sale was executed between the Fernandez Spouses and their children, resulting in the issuance of a new title in the names of the Fernandez Siblings.

The Regional Trial Court (RTC) dismissed Cagatao's complaint, ruling that he failed to prove his ownership over the land and that the transfers of ownership from Gatchalian to Manzulin and from Manzulin to Cagatao were null and void. The RTC upheld the validity of the sale from the Spouses Fernandez to Carlos but nullified the transfer to the Fernandez Siblings due to the absence of the Fernandez Spouses' signatures on the deed of sale. The RTC also upheld the validity of the title in the name of Carlos.

Cagatao appealed to the Court of Appeals (CA), which partly granted his petition. The CA ruled that Gatchalian remained the owner of the land by virtue of the homestead patent in his name and invalidated the transfers of ownership claimed by the respondents. However, the CA declared that Cagatao's possession should be respected, and any party asserting a claim of ownership should do so in a separate action.

The respondents moved for reconsideration, and the CA issued an amended decision reversing its earlier ruling on the validity of the deed of sale between Carlos and the Fernandez Spouses. The CA emphasized that Cagatao's possession should still be respected, and any claim of ownership should be pursued in a separate action.

Cagatao filed a petition for review on certiorari before the Supreme Court, raising issues related to the validity of the reconstituted title in Carlos' name and the true ownership of the property.

ISSUES:

1. Whether or not the reconstituted TCT No. 12159-A in the name of Emmaculada Carlos is void.

2. Whether or not homestead title holder Juan Gatchalian and the petitioner as his successors-in-interest are the true owners of the subject property.

3. Whether or not the Court of Appeals erred in deleting from the dispositive portion of the original Decision its ruling that the Deed of Sale between Emmaculada Carlos and respondents Spouses Fernandez over the subject property is void.

RULING:

1. The Court of Appeals partially granted the petition of Cagatao and modified the decision of the Regional Trial Court. The CA upheld Cagatao's possession of the subject property, ruling that his possession should be respected. The CA declared the Deed of Sale dated January 17, 1996 between Emmaculada Carlos and the Fernandez spouses as null and void. However, the CA reversed itself and ruled that the reconstituted TCT No. 12159-A in the name of Emmaculada Carlos is not void. The CA also held that any party, including the respondents, who would like to assert their claim of ownership or a better right over the lot should do so in an appropriate action in court against Cagatao.

PRINCIPLES:

• Possession may not prevail over ownership, but the true owner must assert his/her ownership rights against a possessor.