8. Eagle Realty Corp. v Republic Registration No. N-188044.

In accordance with this Decree, the Register

GR No. 151424 of Deeds of Pasay City issued OCT No. 129 on July 7, 1983 in the name of
04 July 2008 a Martina G. Medina.
By: Ambe
 Medina later exchanged the property for a 3,000-hectare parcel of land in
Topic: General Functions of LRA; Action for Compensation from Assurance Fund Norzagaray, Bulacan owned by Pilarita Reyes through a Deed of Exchange
Petitioner: Eagle Realty Corporation dated September 12, 1983.
Respondents: Republic of the Philippines, represented by the Administrator of the
Land Registration Authority, National Treasurer of the Philippines, Heirs of Casiano  Thereafter, through a Deed of Sale dated February 22, 1984, Reyes sold
de Leon, Maria Socorro de Leon, and Pilarita Reyes the property to petitioner, Eagle Realty Corp. for P1,200,000.00. On
Ponente: Nachura, J March 1, 1984, TCT No. 74216 was cancelled, and TCT No. 78982 was
issued in petitioner’s name.
DOCTRINE: Under Section 6, P.D. 1529, the Commissioner of Land Registration shall
exercise supervision and control over all Registers of Deeds. It is well understood  Meanwhile, Cesario de Leon discovered that OCT No. 129 was issued to
that "supervision and control" includes the authority to act directly whenever a Martina G. Medina. The De Leons sent a letter-complaint to the LRC
specific function is entrusted by law or regulation to a subordinate. As the public asking for an investigation on the matter.
officer having supervision and control over Registers of Deeds, the Commissioner of
Land Registration therefore also has the authority to file the action himself.  Atty. Panis, who is Chief of the Inspection and Investigation Division of
the LRC concluded that the Medina Decision and the Order for the
FACTS: Issuance of Decree dated February 14, 1980 were fake.
 On May 21, 1963, the spouses Casiano de Leon and Maria Socorro de
Leon filed with the then Court of First Instance (CFI) of Rizal an  Consequently, on September 6, 1984, the Republic of the Philippines,
application for registration of Lots 1 and 2, Plan Psu-173022-B, located at represented by the Acting Land Registration Commissioner, filed a
Barrio San Dionisio, Parañaque, Rizal, with an area of 57,989 square complaint for "Annulment of Judgment and Cancellation of Decree and
meters. The case was raffled to Branch II presided over by Judge Pedro C. Titles" against Martina G. Medina, Pilarita Reyes and petitioner Eagle
Navarro. Realty Corporation. The Register of Deeds of Pasay City was impleaded as
a nominal party.
 On December 11, 1979, the CFI rendered a decision in favor of Casiano de
Leon and his children. Copies of this decision (De Leon Decision, for  On November 17, 1992, the RTC ruled in favor of the private respondents
brevity) were sent through registered mail to the Land Registration Heirs of De Leon. RTC declared that the order for the issuance of decree
Commission (LRC). This judgment became final and executory on August dated February 14, 1980 in favor of Martina G. Medina, and Transfer
13, 1984. Certificates of Title Nos. 74216 and 78982 in the name, respectively, of
Pilarita M. Reyes and Eagle Realty Corporation are null and void. RTC
 It appears that another decision, similar to the De Leon Decision but ordered the Register of Deeds of Pasay to cancel the owner’s copy and
adjudicating the property to a certain Martina G. Medina, alleged the original copy in his files.
intervenor in LRC Case No. N-4140, was surreptitiously inserted in the
records of the LRC. This decision (Medina Decision, for brevity) was  RTC also ordered that in the event that Eagle Realty Corporation is unable
similarly dated December 11, 1979 and purportedly signed by Judge to collect the sum of P1.2 million with legal interest from its co-
Pedro C. Navarro. defendants, the third-party defendant National Treasurer of the
Philippines is ordered to pay the said amount through the Assurance
 On May 30, 1983, pursuant to these documents, Hon. Oscar R. Victoriano, Fund.
then Acting Land Registration Commissioner, issued Decree of
  CA affirmed the decision of the RTC. (2) Indeed, the general rule is that a purchaser may rely on what appears on
the face of a certificate of title. An exception to this rule is when there
ISSUE: exist important facts that would create suspicion in an otherwise
(1) W/N the Republic through the Land Registration Authority (LRA) has reasonable man (and spur him) to go beyond the present title and to
personality to institute the complaint based on Section 100 of investigate those that preceded it. The presence of anything which
Presidential Decree (P.D.) No. 1529. YES. excites or arouses suspicion should then prompt the vendee to look
(2) W/N Eagle Realty is an innocent purchaser for value. NO. beyond the certificate and investigate the title of the vendor as appearing
on the face of said certificate. One who falls within the exception can
HELD/RATIO: neither be denominated an innocent purchaser for value nor a purchaser
(1) Indisputably, the government is charged with the duty to preserve the in good faith, hence, does not merit the protection of the law.
integrity of the Torrens System and protect the Assurance Fund. The
Complaint seeks the cancellation of erroneously issued titles to protect As correctly observed by the public respondent, the property covered by
the Assurance Fund from being made liable by the private respondents the void titles was transferred from Medina to petitioner with unusual
for damages in case they fail to recover the property. The public officer haste. Only 8 months lapsed since OCT No. 129 was issued on July 7, 1983
specifically tasked to perform this duty is the Register of Deeds who, until it was transferred to petitioner on February 22, 1984. The property
under Section 100 of P.D. No. 1529, is authorized to file an action to was transferred to petitioner from Reyes only more than five months
annul a certificate of title erroneously or unlawfully issued, thus: after she herself acquired the property. These circumstances, plus the
fact that the subject property is a vast tract of land in a prime location,
“SEC. 100. Register of Deeds as party in interest. — When it appears that should have, at the very least, triggered petitioner’s curiosity.
the Assurance Fund may be liable for damages that may be incurred due
to the unlawful or erroneous issuance of a certificate of title, the Register Moreover, petitioner is a corporation engaged in the real estate business.
of Deeds concerned shall be deemed a proper party in interest who A corporation engaged in the buying and selling of real estate is expected
shall, upon the authority of the Commissioner of Land Registration, file to exercise a higher standard of care and diligence in ascertaining the
the necessary action in court to annul or amend the title.” status and condition of the property subject of its business transaction.
Similar to investment and financing corporations, it cannot simply rely on
Under Section 6, P.D. 1529, the Commissioner of Land Registration shall an examination of a Torrens certificate to determine what the subject
exercise supervision and control over all Registers of Deeds. It is well property, looks like as its condition is not apparent in the document.
understood that "supervision and control" includes the authority to act
directly whenever a specific function is entrusted by law or regulation to Petitioner’s claim against the Assurance Fund must necessarily fail. Its
a subordinate. As the public officer having supervision and control over situation does not come within the ambit of the cases protected by the
Registers of Deeds, the Commissioner of Land Registration therefore also Assurance Fund. It was not deprived of land in consequence of bringing it
has the authority to file the action himself. under the operation of the Torrens system through fraud or in
consequence of any error, omission, mistake or misdescription in the
The LRC is a mere agency of the government, unincorporated, and with certificate of title. It was simply a victim of unscrupulous individuals.
no separate juridical personality from that of the Republic of the More importantly, it is a condition sine qua non that the person who
Philippines. Naming the Republic of the Philippines as plaintiff and merely brings the action for damages against the Assurance Fund be the
acting as its representative was not even necessary since the registered owner and, as the holders of transfer certificates of title, that
Commissioner of Land Registration himself, as the superior of and they be innocent purchasers in good faith and for value. And we have
exercising control over the Register of Deeds, had the authority to file the already established that petitioner does not qualify as such.
complaint on his own.
Petition is denied.
NOTES:
 The principle of indefeasibility of a Torrens title does not apply where
fraud attended the issuance of the title.
 Prescription does not run against the State and its subdivisions.