PHILIPPINE ECONOMIC ZONE AUTHORITY V. FERNANDEZ

358 SCRA 489

 

FACTS:

The  subject  parcel  of  land  was  subject  of  an  expropriation  proceeding entered into by EPZA and the newly registered owners of the land.  Private respondents  sought  the  nullity  of  the  documents  executed  as  he  alleged
that  he  was  excluded  from  the  extrajudicial  partition  of  the  estate, originally owned by their predecessors.  Petitioner sought the dismissal of the complaint as it was allegedly barred by prescription.  This was denied by the trial court and the CA.   
 

HELD:

An  action  for  reconveyance  resulting  from  fraud  prescribes  4  years  from the discovery of the fraud; such discovery is deemed to have taken place upon the issuance of the certificate of title over the property.  Registration of real property is considered constructive notice to all persons, and thus, a four-year period shall be counted therefrom.  The action for reconveyance based on fraud has already prescribed.
 
Even  an  action  for  reconveyance  based  on  an  implied  constructive  trust would  have  already  prescribed.    The  imprescriptibility  of  an  action  for reconveyance  based  on  implied  trust  applies  only  when  the  plaintiff  is  in
possession  of  the  property.    However,  private  respondents  are  not  in possession of the disputed property.  In fact, they don’t even claim to be in possession  of  it,  even  if  to  so  would  enable  them  to  justify  the imprescriptibility of their action.
 
Furthermore, reconveyance is a remedy to those whose property has been wrongfully  registered  in  the  name  of  another.    Such  recourse  however cannot  be  availed  of  once  the  property  has  passed  to  an  innocent
purchaser  for  value.    For  an  action  for  reconveyance  to  prosper,  the property should not have passed into the hands of an innocent purchaser for value.