The Supreme Court has ruled that any sale of public land before the formal awarding of a land patent is invalid. This means that agreements made before the government officially grants ownership are not legally binding. Even if someone has applied for a land patent and made arrangements to sell the land, the sale cannot be enforced until the patent is issued. This decision protects the State’s control over public lands and prevents individuals from prematurely claiming ownership.

Premature Promises: When Land Deals Fall Flat Before the Title Arrives

This case revolves around a parcel of land in Barangay Leron, Buguey, Cagayan. Enrique Unciano, Sr., applied for a free patent over the land. Before his application was approved, he sold the property to his daughter, Anthony U. Unciano, for P70,000.00. He even signed a waiver relinquishing his rights as a free patent applicant in her favor. After the patent was approved, Original Certificate of Title (OCT) No. P-80515 was issued in Enrique Sr.’s name, and he immediately executed a Deed of Reconveyance in favor of Anthony. However, his other child, Leona Timotea U. Gorospe and her husband Federico U. Gorospe refused to surrender the land, leading Anthony to file an accion reinvindicatoria to recover the property. The central legal question is whether the sale of land, before the approval of a free patent application, is valid and enforceable.

The Municipal Trial Court (MTC) initially ruled in favor of Anthony, stating that the sale was perfected before the registration and titling of the property and therefore not prohibited. The Regional Trial Court (RTC) affirmed this decision. However, the Court of Appeals (CA) reversed the lower courts, holding that the prior agreements were inconsequential since they were made before the patent approval and not annotated on the OCT. The CA declared Anthony’s Transfer Certificate of Title (TCT) as null and void, and the OCT in Enrique, Sr.’s name as valid and subsisting. The Supreme Court then took up the case to settle the conflicting rulings.

At the heart of the matter is Section 118 of Commonwealth Act (C.A.) No. 141, also known as the Public Land Act. This section restricts the sale or encumbrance of lands acquired under free patent or homestead provisions. It states:

SEC. 118. Except in favor of the Government or any of its branches, units, or institutions, lands acquired under free patent or homestead provisions shall not be subject to encumbrance or alienation from the date of the approval of the application and for a term of five years from and after the date of issuance of the patent or grant, nor shall they become liable to the satisfaction of any debt contracted prior to the expiration of said period, but the improvements or crops on the land may be mortgaged or pledged to qualified persons, associations, or corporations.

No alienation, transfer, or conveyance of any homestead after five years and before twenty-five years after issuance of title shall be valid without the approval of the Secretary of Agriculture and Commerce, which approval shall not be denied except on constitutional and legal grounds.

While Section 118 doesn’t explicitly prohibit sales before patent approval, the Supreme Court emphasized the **regalian doctrine**. This doctrine, enshrined in the Constitution, asserts that all public lands belong to the State and are not subject to private appropriation until officially granted. The Court clarified that the issuance of the patent and its registration are the operative acts that transfer ownership from the government to the applicant.

Fundamental property law dictates that “no one can give what he does not have.” At the time of the sale between Enrique, Sr. and Anthony, the land was still part of the public domain. Enrique, Sr. only held an inchoate right as an applicant, not ownership. His application acknowledged the land’s public status. The Court noted that allowing such pre-patent sales would undermine the purpose of the free patent system, which is to benefit the applicant exclusively. The court cited previous rulings, such as Development Bank of the Philippines v. Court of Appeals, which invalidated mortgages constituted on public land during the pendency of a free patent application. These cases reinforce the principle that public land remains outside the commerce of man until the State officially divests itself of ownership.

The Court then addressed the issue of whether the CA’s ruling constituted an impermissible collateral attack on Anthony’s TCT. An accion reinvindicatoria is an action for reconveyance, where the rightful owner seeks to compel the registered owner to transfer the land. Such actions respect the registration decree but aim to show that the registered owner is not the true owner. While Section 48 of Presidential Decree No. 1529 bars collateral attacks on certificates of title, the Court clarified that the respondents’ counterclaim of ownership in their answer effectively constituted a direct attack on Anthony’s title. A counterclaim is essentially a complaint by the defendant against the plaintiff, giving the respondents the opportunity to challenge the validity of the TCT.

Therefore, the Supreme Court affirmed the Court of Appeals’ decision, holding that the sale between Enrique, Sr. and Anthony during the pendency of the free patent application was void. As Anthony’s title was derived from this invalid transaction, her TCT was also deemed null and void. The Court reiterated that the public land laws aim to keep gratuitously granted public land within the homesteader’s family. The court in Gonzaga v. Court of Appeals has stressed that the State retains plenary power to determine who receives public lands and under what terms. This ensures that the benefits of the free patent system are not circumvented through premature or fraudulent transactions.

FAQs

What was the key issue in this case?	The key issue was whether a sale of public land, made before the approval of a free patent application, is valid and enforceable under Philippine law.
What is an accion reinvindicatoria?	An accion reinvindicatoria is a legal action where the rightful owner of a property seeks to recover possession from someone who has wrongfully registered or occupied it. It aims to compel the current possessor to reconvey the property to the rightful owner.
What is the regalian doctrine?	The regalian doctrine asserts that all lands of the public domain belong to the State, and private individuals cannot claim ownership unless the State has officially granted it to them. This doctrine underpins the government’s control over public lands.
What does Section 118 of the Public Land Act say?	Section 118 of Commonwealth Act No. 141 prohibits the sale or encumbrance of lands acquired under free patent or homestead provisions within five years from the date of the patent’s issuance. This aims to protect the homesteader from losing the land due to improvident transactions.
What is a collateral attack on a title?	A collateral attack on a title occurs when the validity of a land title is questioned in a lawsuit where the primary objective is something other than directly challenging the title’s validity. Such attacks are generally prohibited under Philippine law.
Why was the sale between Enrique, Sr. and Anthony deemed invalid?	The sale was deemed invalid because it occurred before Enrique, Sr. had acquired ownership of the land through the issuance of the free patent. At the time of the sale, the land was still part of the public domain.
What is the significance of a counterclaim in this case?	The respondents’ counterclaim asserting ownership of the land was significant because it was treated as a direct attack on the petitioner’s title, allowing the Court of Appeals to rule on the validity of that title.
What is the effect of the Deed of Reconveyance?	The Deed of Reconveyance, executed after the issuance of the OCT, was deemed void because it involved a prohibited alienation under Section 118 of C.A. No. 141, as the initial sale was invalid.
What is the main takeaway from this case?	The main takeaway is that any sale or transfer of public land before the issuance of a patent is invalid. It does not confer ownership. One must wait for the official grant of title from the government before engaging in any transactions.

In conclusion, this case highlights the importance of adhering to the regulations governing public land grants. Premature transactions can lead to the invalidation of titles and the loss of property rights. It is essential to ensure that all legal requirements are met and that the land patent is officially issued before entering into any agreements to sell or transfer public land.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: Anthony U. Unciano v. Federico U. Gorospe and Leona Timotea U. Gorospe, G.R. No. 221869, August 14, 2019