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ALSONS DEVELOPMENT v. HEIRS OF ROMEO D. CONFESOR

FACTS:

This case involves the cancellation and revocation of the Industrial Forest Plantation Management Agreement (IFPMA) No. 21 between the Department of Environment and Natural Resources (DENR) and Alsons Development and Investment Corporation (petitioner). On January 15, 1996, petitioner and the DENR executed IFPMA No. 21 over a parcel of land in General Santos City, South Cotabato. The controversy arose when the heirs of Romeo D. Confesor (respondents) filed a protest against petitioner, alleging that a large portion of the land subject to IFPMA No. 21 was part of their property covered by an original certificate of title (OCT). Prior to the protest, the subject property was investigated by the Land Registration Authority, which initially deemed the title as spurious but was later affirmed as valid and authentic by the Department of Justice. The DENR conducted its own investigation and found that the OCT was genuine but discovered fake and spurious certificates of title purportedly issued to respondents. The DENR dismissed the protest against IFPMA No. 21, but on appeal, the Office of the President (OP) set aside the DENR’s decision and ordered the cancellation and revocation of the agreement. Petitioner filed a motion for reconsideration, and the OP eventually granted it, ruling that laches applies and that the respondents failed to comply with the requirements for perfecting a sales patent.

The case involves a dispute over ownership of a parcel of land. The Office of the President (OP) initially decided in favor of the respondents, ruling that they have established their ownership of the subject property. The petitioner filed a motion for reconsideration, which was denied by the OP. The petitioner then filed a Petition for Review with the Court of Appeals (CA), questioning the OP's decision. The petitioner also filed an urgent motion for a status quo order, arguing that there is a pending case before the Regional Trial Court (RTC) to nullify the respondents' title. The CA denied the motion for injunctive relief. The RTC later dismissed the case for failure to comply with filing requirements. The CA subsequently affirmed the OP's decision, ruling that the subject property is alienable and disposable, and that the respondents' title is not spurious. The CA also noted that the petitioner's argument regarding laches does not apply considering the title is registered under the Torrens system. The petitioner filed a motion for reconsideration, which was denied by the CA. The Republic later re-filed its petition for annulment of titles and reversion in a separate case before the RTC. The petitioner argues that the issue of canceling the title is dependent on the outcome of the petition for reversion.

ISSUES:

  1. Whether the civil case for annulment of title and reversion before the RTC constitutes a prejudicial question which would operate as a bar to the action for the cancellation of IFPMA No. 21.

  2. Whether there is a prejudicial question present in the case.

  3. Whether the cancellation of IFPMA No. 21 should be held in abeyance pending the resolution of the civil case before the RTC.

  4. Whether the factual findings of the Department of Environment and Natural Resources (DENR) regarding the authenticity and legality of the respondents' title should be upheld.

  5. Whether the civil case directly attacking the respondents' title should be given priority over the current case.

RULING:

  1. The Supreme Court ruled in favor of the petitioner, finding merit in the instant petition. The Court held that the civil case for annulment of title and reversion before the RTC does constitute a prejudicial question which would bar the action for the cancellation of IFPMA No. 21. The Court stated that the resolution of the civil case is determinative of the issue of ownership and would avoid conflicting decisions.

  2. The Court recognized that technically there was no prejudicial question since the cases involved were civil and administrative in character. However, it took into consideration the intimate relation between the two cases, wherein the right of private respondents to eject the petitioner from the subject property depends on the resolution of the issue pending in the administrative case. Thus, the Court ruled that it would be more prudent to hold the ejectment proceedings in abeyance until after a determination of the administrative case.

  3. The Court stated that the cancellation of IFPMA No. 21 is dependent on the determination of respondents' right over the subject property. It noted that allowing the cancellation of IFPMA No. 21 at the instance of respondents, notwithstanding the possibility that respondents have no right over the property, would be a "sheer exercise in futility." The Court emphasized the importance of waiting for the resolution of the civil case before deciding on the cancellation of IFPMA No. 21.

  4. The issue of whether or not to uphold the factual findings of the DENR regarding the authenticity and legality of the respondents' title should be addressed at the full-blown trial in the civil case directly attacking said title pending before the Regional Trial Court (RTC). The Court reversed and set aside the Decision of the Court of Appeals and dismissed the respondents' protest before the DENR.

  5. The current case should be stayed until the civil case directly attacking the respondents' title is settled. The RTC is ordered to proceed with the civil case with dispatch.

PRINCIPLES:

  • Prejudicial question refers to a question that arises in a case, the resolution of which is determinative of the guilt or innocence of the accused in a subsequent criminal case, or the resolution of which is determinative of an issue in another case and would avoid conflicting decisions.

  • The rationale behind the principle of prejudicial question is to avoid two conflicting decisions.

  • Courts have the inherent power to control their case disposition with economy of time and effort. They have the discretion to hold proceedings in abeyance if it would be more prudent to wait for the resolution of a related case.

  • The determination of the issue in a civil case may be determinative of an issue in an administrative case, and it is more logical and practical to wait for the resolution of the civil case before deciding on the administrative case.

  • The rights of parties to an action cannot be properly determined until the questions raised in another action are settled.

  • The factual findings of administrative agencies, such as the DENR, regarding the authenticity and legality of a title should be addressed and resolved in the court with jurisdiction over the civil case directly attacking said title.