TOMAS vs COURT OF APPEALS

FACTS:

Respondents are the vendees of a parcel of land measuring 105 square meters covered by Tax Declaration No. 2502 in the names of certain Cirila Mistica and her children. The original deed executed on September 5, 1961 covered 57 square meters but the second deed executed on February 5, 1963 covered 105 square meters instead of 57 square meters (may sukat na Isang Daan at Limang (105) metrong parisukat humigit kumulang sa halip na Limamput Pitong (57) metrong parisukat kasunduan ng Bilihang Tuluyan). Respondents claimed to be in possession since 1963 of said parcel of land, where they constructed valuable improvements, including a 3-door apartment in 1963. In the year 1978, respondents discovered that defendant-petitioners together with their deceased brother, Lazaro Tomas, applied for the registration of a parcel of land known as Lot No. 2826 of the Meycauayan Cadastre, and "either by mistake or by design" included therein a portion of the land belonging to respondents consisting of 65 square meters adjacent to the parcel owned by petitioners on the Northern part thereof, and obtained Original Certificate of Title No. 0-6337 of the Registry of Deeds of Bulacan, which included the said 65 square meters of land. Petitioners refused to reconvey the said land to respondents, thus an action for reconveyance was instituted.

The action for reconveyance was filed by respondents against petitioners before the Court of First Instance of Bulacan on January 2, 1979. Hence, this petition.

Petitioners raised the following assignments of errors to the effect that respondent Court of Appeals: (1) misapprehended the facts; and (2) erred in not dismissing the complaint on the grounds of : (a) absence of allegation of fraud; (b) res judicata; and (c) prescription or laches.

ISSUE:

Whether or not the respondents' complaint should be dismissed on the above-stated grounds.

HELD: 

Article 1456 of the Civil Code provides that: "If a 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 from whom the property comes.

In the present case, prescription will not lie in favor of the petitioners who are not even in possession of the disputed land. Undoubtedly, they obtained the property by mistake or fraud so that by operation of law, they are considered as trustees of an implied trust for the benefit of the respondents from whom the property came.

It is well-settled that an action for reconveyance based on an implied trust or constructive trust prescribes in ten years from the issuance of torrens title over the property (Vda. de Buncio v. Estate of the late Anita de Leon, 156 SCRA 352 [1987]) which must be brought within ten years from the time of accrual of the cause of action (Alcos, et al. v. IAC, 162 SCRA 825 [1988]). Respondent's action for reconveyance was filed on January 2, 1979, one year from the time respondents discovered that petitioners together with their deceased brother applied for the registration of a parcel of land known as Lot No. 2626, in 1978.

An action for reconveyance is a legal remedy granted to a rightful owner of land wrongfully or erroneously registered in the name of another to compel the latter to reconvey the land to him (Esconde v. Barlongay, 152 SCRA 603 [1987]).

The prevailing rule in this jurisdiction does not bar a land owner whose property was wrongfully or erroneously registered under the Torrens System from bringing an action after one year from issuance of the decree, for the reconveyance of the property in question. Such action for reconveyance does not seek to set aside the decree but, respecting the decree as incontrovertible and no longer open to review, instead seeks to transfer or reconvey the land from the registered owner to the rightful owner.