ACTION FOR RECONVEYANCE

I. DEFINITION:
Reconveyance is a remedy granted only to the owner of the property alleged
to be erroneously titled in anothers name. (De Lapia vs. CA, 231 SCRA
456)
Reconveyance is a remedy of the landowner whose property has been
wrongfully or erroneously registered in the name of another but which
recourse cannot be availed of if the property has passed to an innocent
purchaser for value. (Legarda vs. CA, 280 SCRA 642)
2. LEGAL BASIS OF THE ACTION:
A certificate or title shall not be subject to collateral attack. It can not be
altered, modified or cancelled except in a direct proceeding in accordance
with law. (Section 48, PD 1529)
No title to registered land in derogation of the title of the registered owner
shall be acquired by prescription or adverse possession. (Section 47, PD No.
1529)
If property is acquired through mistakes or fraud, the person obtaining it is,
by force of law, considered a trustee of an implied trust for the benefit of the
person from whom the property comes. (Article 1456, NCC)
3. BURDEN:
Person who claim that he has a better right to a real property must prove not
only his ownership of the same but he must also satisfactorily prove the
identity thereof. (Javier vs. CA, 231 SCRA 498)
In action to recover, the property must be identified, and the plaintiff must
rely on the strength of his title and not on the weakness of defendants claim.
(Misa vs. CA, 212 SCRA217)
The requisites of an action for reconveyance: a. Clear and convincing
evidence of title to the property; and b. Fact of fraud committed by the party
who registered the property in his/her name. Said action presupposes the
existence of a defrauded party who is the lawful owner of the disputed
property an element not established in this case. (Heirs of Brusas vs.
Court of Appeals, GR No. 126875, Aug. 26, 1999)
4. GROUNDS OF THE ACTION:
4.a. FRAUD:

Article 1330. A contract where consent is given through mistake, violence,

intimidation, undue influence, or fraud is voidable.
Article 1338. There is fraud when, through insiduous words or machinations
of one of the contracting parties, the other is induced to enter into a contract
which, without them, he would not have agreed to. (see Article 1139,
Article 1344)
In all cases of registration procured by fraud, the owner may pursue all his
legal and equitable remedies against the parties to such fraud without
prejudice however, to the rights of any innocent holder for value of a
certificate of title. After the entry of the decree of registration on the original
petition or application, any subsequent registration procured by the
presentation of a forged duplicate certificate of title, or a forged deed or
other instrument, shall be null and void. (3rd par., Sec. 53, P.D. 1529)

Fraud is of four (4) kinds: actual or constructive.

4.a.1.Actual or positive fraud proceeds from intentional deception
practiced by means of misrepresentation or concealment of a material fact.
4.a.2.Constructive fraud is construed as a fraud because of its detrimental
effect upon public interest and public or private confidence even though the
act is not done or committed with an actual design to commit positive fraud
or injury upon other persons.
4.a.3.Extrinsic fraud is present when it prevents a party from having a trial
or from presenting his entire case to the court or where it operates upon
matters pertaining not to the judgment itself but to the manner in which it is
procured, so that there is not a fair submission of the controversy. Extrinsic
fraud is also actual fraud, but collateral to the transaction sued upon.
4.a.4. Intrinsic fraud is present when fraudulent acts pertain to an issue
involved in the original action on the acts constituting the fraud were or
could have been litigated therein.
Latest decisions:
The four year prescriptive period relied upon by the trial court applies only if
the fraud does not give rise to an implied trust, and the action is to annul a
voidable contract under Article 1390 of the Civil Code. In such a case, the
four year prescriptive period under Article 1391 begins to run from the time
of discovery of the mistake, violence, intimidation, undue influence or fraud.
It is now settled that the prescriptive period to recover property obtained by
fraud or mistake, giving rise to an implied trust under Article 1456 of the
Civil Code, is ten years pursuant to Article 1144. This ten-year prescriptive
period begins to run from the date the adverse party repudiates the implied

trust, which repudiation takes place when the adverse party registers the
land. (Sps. Ricardo Pascual and Consolacion Sioson vs. Court of Appeals
and Remedios S. Eugenio-Gino, G.R. No. 115925, August 15, 2003,
Carpio, J.; Sps. Alfredo vs. Sps. Borras, G.R. No. 144225, 17 June 2003)
In Adille vs. Court of Appeals, 157 SCRA 455, the Supreme Court reckoned
the ten-year prescriptive period for enforcing implied trusts not from
registration of the adverse title but from actual notice of the adverse title by
the cestui que trust. However, the Supreme Court, in justifying its deviation
from the general rule, explained: while the actions to enforce a constructive
trust prescribes (sic) in ten years, reckoned from the date of the registration
of the property, we xxx are not prepared to count the period from such date
in this case. We note the petitioners sub rosa efforts to get hold of the
property exclusively for himself beginning with his fraudulent
misrepresentation in his unilateral affidavit of extrajudicial settlement that he
is the only heir and child of his mother Feliza with the consequence that
he was able to secure title in his name also.(Emphasis Supplied) (Sps.
Ricardo Pascual and Consolacion Sioson vs. Court of Appeals and
Remedios S. Eugenio-Gino, G.R. No. 115925, August 15, 2003, Carpio,
J.)
5. GENERAL RULE:
No title to registered land in derogation of the title of the registered owner
shall be acquired by prescription or adverse possession. (Section 47, PD No.
1529)
The Mirror Principle:
-In the absence of anything to excite suspicion, the buyer is not obligated to
look beyond the certificate to investigate the title of the seller appearing on
the face of the certificate. (AFP Mutual Benefit Association vs. Court of
Appeals, 327 SCRA 203, March 3, 2000)
-Unfortunately for private respondents, the property was registered under
TCT No. 43100 solely in the name of Gertrudes Isidro, widow. Where a
parcel of land, forming part of the undistributed property of the dissolved
conjugal partnership of gains, is sold by the widow to a purchaser who
merely relied on the face of the certificate of title thereto, issued solely in the
name of the widow. The purchaser acquires a valid title to the land even as
against the heirs of the deceased spouse. The rationale for this rule is that
a person dealing with registered land is not required to go behind the
register to determine the condition of the property. He is only given with
notice of the burdens on the property which are noted on the face of the
register or the certificate of title. To require him to do more is to defeat
the primary objects of the Torrens System.
Every person dealing with registered land may safely rely on the correctness
of the certificate of title issued therefore and the law will in no way oblige

him to behind the certificate to determine the condition of the property.

(Cruz vs. CA, 281 SCRA 491)
Every person dealing with registered land safely rely on the correctness of
the certificate of title issued therefor and the law will in no way oblige him
to go beyond the certificate to determine the condition of the property.
(Tenio- Obsiquio vs. CA, 230 SCRA 550)
Once a title is registered, the owner may rest secure, without the necessity
of waiting in the portals of the court, or sitting in the mirador su casa, to
avoid the possibility of losing his land. (Legarda vs. CA, 280 SCRA 642)
Every person dealing with registered land may safely rely on the correctness
of the certificate of title issued therefore and the law will in no way to oblige
him to go beyond the certificate to determine the condition of the property.
(Legarda vs. CA, 280 SCRA 642)
Every person dealing with registered land may safely rely on the certificate
of title issued therefor and the law will in no way oblige him to go beyond
the certificate to determine the condition of the property. (Natividad P.
Nazareno, et.al. vs. CA, etal, GR No. 138842, October 18, 2000)
5.a. EXCEPTIONS:
5.a.1.In VDA DE CABRERA vs. COURT OF APPEALS, 267 SCRA 339,
February 3, 1997, the Supreme Court found that the certificate of title of the
vendees are, to say the least irregular and was issued in a calculated move to
deprive Felicidad Teokemian of her dominical rights over the property
reserved to her by descent. Thus, the Supreme Court held that the defense of
indefeasibility does not extend to a transferee who takes the certificate with
a notice of a flaw in his title.
5.a.2. Although it is a recognized principle that a person dealing on a
registered land need not go beyond its certificate of title, it is also a firmly
settled rule that where there are circumstances which would put a party on
guard and prompt him to investigate or inspect the property being sold to
him, such as the presence of occupants/tenants thereon. It is, of course,
executed of a purchaser of a valued piece of land to inquire first into the
status or nature of possession of the occupants, whether or not the occupants
possess the land in conceptuo dueno. As is the common practice in the real
estate industry, an ocular inspection of the premises involved is a safeguard,
a cautious and prudent purchaser usually takes. Should he find out that the
land he intends to buy is occupied by anybody else other than the seller who,
in this case, is not in actual possession, it would then be incumbent upon the
purchaser to verify the extent of the occupants possessory rights. The failure
of a prospective buyer to take such precautionary steps would mean
negligence on his part and would thereby prelude him from claiming or
invoking the rights of a purchaser in good faith. (Mathay vs. Court of
Appeals, 295 SCRA 556)

5.a.3. The defense of indefeasibility of a Torrens title does not extend to a

transferee who takes the certificate with notice of a flaw, a holder in bad
faith of a certificate of title is not entitled to the protection of the law.
(Baricuatro, Jr. vs. Court of Appeals, February 9, 2000)
5.a.4. The rule on indefeasibility of a torrens title, i.e. that it can be attacked
only for fraud within one (1) year after date of issuance of the decree of
registration applies only to original certificates of title not to subsequent
registration. (Agasan vs. Court of Appeals, 325 SCRA 504, February 15,
2000)
5.a.5. While it is true that the torrens title is indefeasible and imprescriptible,
the registered landowner may lose his right to recover the possession of his
registered property by reason of laches. (Isabela Colleges, Inc. vs. The
Heirs of Nieves Tolentino Rivera, et.al. GR No. 132677, October 20,
2000)
-LACHES means the failure or neglect for an unreasonable and
unexplained length of time to do that which, by observance of due diligence,
could or should have been done earlier. It is negligence or omission to assert
a right within a reasonable time, warranting the presumption that the party
entitled to assert his right either has abandoned or declined to assert it.
Laches thus operate as a bar in equity. (Ibid)
NOTE:
Indeed, even if the sale to petitioner was made in bad faith, laches would
nonetheless apply. In Claveria vs. Quingco, 207 SCRA 66, notwithstanding
the fact that the buyer had acted in bad faith because he knew that the vendor
was not the registered owner, it was held that the registered owners inaction
for 36 years had definitely foreclosed his right to recover the property. (Ibid)
5.b. EXCEPTIONS TO THE EXCEPTIONS:
5.B.1.While an inherent defective Torrens title may not ordinarily be
cancelled even after proof of its defect, the law nevertheless safeguards the
rightful partys interest in the titled land from fraud and improper use of
technicalities by allowing such party, in appropriate cases, to judicially seek
reconveyance to him of whatever he has been deprived of as long as the
land has not been transferred or conveyed to a purchaser in good faith.
The Torrens system was never calculated to foment betrayal in the
performance of a trust. (Victorias vs. Leuenberger and CA, GR No.
31189, March 31, 1987)
6. PRESCRIPTION:
Prescription
- is a derivative mode by which one acquires ownership
and other real rights, or loses rights and actions through the lapse of time

and in the manner and under the conditions laid down by law. (Article 1106,
Civil Code of the Philippines).
In DABLO vs. COURT OF APPEALS, (226 SCRA 618(1983), the
Supreme Court held that ownership of registered land under the Torrens
System is imprescriptible, which means that no third person can acquire said
land by acquisitive prescription and that the registered owners or title
holders action to recover the land does not prescribe nor does laches bar
him from doing so.
An action for the reconveyance of land based on implied or constructive
trust prescribes in ten years. And it is from the date of issuance of such title
that the effective assertion of adverse title for purposes of the statute of
limitation is counted. (Jaramil vs. Court of Appeals, 78 SCRA 420).
An action for reconveyance based on an implied trust, prescribes in ten (10)
years. If based on fraud, the action prescribes in four (4) years, counted
from the discovery of fraud. (Armamento vs. Guerrero, L-34328,
February 21, 1980, 80 SCRA 178).
Action for Reconveyance
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Action for reconveyance of a parcel of land based on implied and
cosntructive trust prescribes in ten (10) years, the point of reference being
the date of registration of the deed or the date of issuance of the certificate of
title over the property. However, we emphasized that this rule applies only
when the plaintiff or the person enforcing the trust is not in possession of the
property since if a person claiming to be the owner thereof is in actual
possession of the property the right to seek reconveyance, which in effect
seeks to quiet title to the property, does not prescribe. (Reyes vs. CA, GR.
No. 127608, September 30, 1999, 2nd division, Bellosillo J.)
Actions for reconveyance, grounded on the nullity of the conveyance of the
subject property, are imprescriptible. (Agne vs. Director of Lands, 181
SCRA 793)
An action for reconveyance of real property to enforce an implied trust
prescribes in ten years, the period reckoned from the issuance of the adverse
title of the property which operates as a constructive notice. (Gonzales vs.
Intermediate Appellate Court, 204 SCRA 106)
It is now well-settled that an action for reconveyance based on an implied or
constructive trust prescribes in ten years from the issuance of the Torrens
Title over the property. (Tale vs. CA, 208 SCRA266)
An action of reconveyance of a parcel of land based on implied or
constructive trust prescribes in ten years from registration of the deed or date

of issuance of certificate of titled over the property but this rule applies only
when the plaintiff is not in possession of the property. (Olviga vs. CA, 227
SCRA 330)
An action for reconveyance of a parcel of land based on implied or
constructive trust prescribes in ten years, the point of reference being the
date registration of the deed or the date of the issuance of the certificate of
title over the property, but this rules applies only when the plaintiff or the
person enforcing the trust is not in possession of the property, since if a
person claiming to be the owner thereof is in actual possession of property,
the right to seek reconveyance, which in effect seeks to quiet title to the
property, does not prescribe. (Vda. De Cabrera vs. CA, 267 SCRA 339)
It is an enshrined rule that even a registered owner of the property may be
barred from recovering possession of property by virtue of laches. (Vda.de
Cabrera vs. CA, 267 SCRA 339)
Our Supreme Court held that the issuance of a transfer certificate of title to
the purchaser without the production of the owners duplicate is illegal.
(Rodriguez vs. Llorente, 49 Phil. 826) and does not confer any right to
the purchaser. (Phil. National Bank vs. Fernandez, 61 Phil. 448 (1935).
Action for Reconveyance
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The Registrar of Deeds must, therefore, deny the registration of any deed or
voluntary instrument if the owners duplicate is not presented in connection
therewith. (Director of Lands vs. Addison, 49 Phil. 19 (1926); Hodges vs.
Treasurer of the Phil., 50 Phil 16 (1927)
Prescription cannot be invoked in an action for reconveyance when the
plaintiff is in possession of the land to be reconveyed. (Millena vs. Court of
Appeals, 324 SCRA 126)
Generally, an action for reconveyance based on an implied or constructive
trust prescribes in 10 years from the date of issuance of decree of registration
except when the plaintiff is in actual possession of the land. (Development
Bank of the Philippines vs. Court of Appeals, 331 SCRA 267)
EXCEPTION TO EXCEPTION:
Actions for reconveyance, grounded on the nullity of the conveyance of the
subject property, are imprescriptible. (Agne vs. Director of Lands, 181
SCRA 793)
PARTIES:

Owners of the property over which reconveyance is asserted are

indispensable parties, without whom no relief is available and without whom
the court can render no valid judgment. (Lozano vs. Ballesteros, 195 SCRA
681)
JURISDICTION:

Where the action affects title to the property, it should be instituted in the
Regional Trial Court where property is situated. (Commodities Storage &
Ice Plant Corp. vs. CA, 274 SCRA 439)
NOTE: SUBJECT TO THE AMENDMENT OF THE RULES OF
COURT BY REPUBLIC ACT NO. 7691.
EFFECT:
If property is acquired through mistake or fraud, the person obtaining it is, by
force of law, considered a trustee of an implied trust for the benefit of the
person whom the property comes. (Article 1456 of the New Civil Code)
Action for Reconveyance
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If properties acquired through mistake or fraud, the person obtaining it is,
by force of law, considered a trustee of an implied trust for the benefit of the
person from whom the property comes. (Manzanilla vs. CA, 183 SCRA
207)
When there is a showing of illegality, the property registered is deemed to
be simply held in trust for the real owner by the person in whose name it is
registered and the former has the right for the re-conveyance of the property.
(Salomon vs. Intermediate Appellate Court, 185 SCRA 352)
Person obtaining property through mistake or fraud is by force of law
considered a trustee of an implied trust for the benefit of the person from
whom the property comes. (Tomas vs. CA, 185 SCRA 627)
Since petitioners knew fully well the defect in their titles due to fraudulent
act of transferring the title into their names, they were correctly held by the
Court of Appeals to be builders in bad faith. (Heirs of Ramon Durano, Sr.,
et.al. vs. Sps. Angeles Sepulveda Uy, et.al., GR No. 136456, October 24,
2000)
PURCHASER IN GOOD FAITH:

Good faith is not a visible, tangible fact that can be seen or touched, but
rather a state or condition of mind which can only be judged by actual or
fancied tokens or signs. Otherwise stated, good faith is the opposite of fraud
and it refers to the state of mind which manifested by the acts of the
individual concerned. (Legarda vs. CA, 289 SCRA 642)
A purchaser in good faith and for value is one who buys the property of
another, 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 notice of the claim or interest of some other
person in the property. (Tenio-Obsiquio vs. CA, 230 SCRA 550)
A purchaser in good faith is one who buys property of another, 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 notice of the claim or interest of some persons in the property.
(Legarda vs. CA, 280 SCRA 642)
The right of an innocent purchaser for value must be respected and
protected, even if the seller obtained his title through fraud. The remedy of
the person prejudiced is to bring action for damages against those who
caused or employed the fraud; if the latter is insolvent, an action against the
Treasurer of the Philippines may be filed for recovery of damages against
Action for Reconveyance
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the Assurance Fund. The application of the principle of equitable estoppel
was upheld. The principle of equitable estoppel states that where one or two
innocent persons must suffer a loss. He who by his conduct made the loss
possible must bear it. From the evidence adduced, it should be the petitioner
who should bear the loss. (Tenio-Obsequio vs. CA; cited in Francisco
Veloso vs. CA, G.R. No. 102737, August 21, 1996)
The rights of an innocent purchaser for value must be respected and
protected notwithstanding the fraud employed by the seller in securing his
title. (citing Pino vs. CA, 198 SCRA 434; Director of Lands vs. Abache,
et.al. 73 Phil. 686)
EXCEPTIONS:
A person dealing with registered land has a right to rely on the Torrens
certificate of Title and to dispense with the need of inquiring further, and he
is considered a buyer in good faith, EXCEPT:
a) when the party has actual knowledge of facts and circumstances
that would impel a reasonably cautious man to make such inquiry. (Santos
vs. CA, 160 SCRA 550; Gonzales vs. IAC, G.R. No. Jan. 29, 1988);

b) When the purchaser has knowledge of defect or the lack of title in

his vendor or of sufficient facts to induce a reasonably prudent man to
inquire into the status of the title of the property in litigation. (SIHI vs. CA,
G.R. No. 115548, March 5, 1996; PNB vs. CA, 153 SCRA 453; Gonzales
vs. IAC, 147 SCRA 587)
c) The presence of anything which excites or arouses suspicion should
then prompt the vendee to look beyond the certificate and investigate the
title of the vendor appearing on the face of said certificate. (Pino vs. CA,
198 SCRA 434; Centeno vs. CA, 139 SCRA 545)
REMEDY:
The sole remedy of the landowner whose property has been wrongfully or
erroneously registered in anothers name is to bring an ordinary action in the
ordinary court of justice for conveyance or if the property has passed into the
hands of innocent purchaser for value, for damages. (Alvarez vs.
Intermediate Appellate Court, 185 SCRA 8)
When there is a showing of illegality, the property registered is deemed to be
simply held in trust for the real owner by the person in whose name it is
registered and the former has the right for the re-conveyance of the property.
(Salomon vs. Intermediate Appellate Court, 185 SCRA 352)
Action for Reconveyance
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DAMAGES:
Actual Damages:
Articles 2199, 2200, 2201, and 2208
Moral Damages
Articles 2216, 2217,2218, and 2219 (10).
Nominal Damages
Articles 2221 and 2222
Exemplary Damages
Articles 2229, 2233 and 2234
Article 1170. Those who in the performance of their obligations are guilty of
fraud, negligence, or delay and those who in any manner contravene the
tenor thereof, are liable for damages.

The right of the owner of the land to recover damages from a builder in bad
faith is clearly provided for in Article 451 of the New Civil Code. Although
said article does not elaborate on the basis for damages, the Court perceives
that it should reasonably correspond with the value of the properties lost or
destroyed as a result of the occupation in bad faith, as well as the fruits
(natural, industrial or civil) from those properties that the owner of the land
reasonably expected to obtain.
Litigation expenses and attorneys fees shall be charged if it is clear that acts
complained of compelled the plaintiffs to litigate and incur expenses to
regain rightful possession and ownership over the disputed property. (Heirs
of Ramon Durano, Sr., et.al. vs. Sps. Angeles Sepulveda Uy, et.al. GR
No. 136456, October 24, 2000)