Bulawan vs. Aquende (G.R. No. 182819; June 22, 2011)


FACTS: On 1 March 1995,Bulawan filed a complaint for annulment of title,reconveyanceand damages against Lourdes Yap (Yap) and the Register of Deeds before the trial court docketed as Civil Case No. 9040.Bulawan claimed that she is the owner of Lot No. 1634-B of Psd-153847 covered by Transfer Certificate of Title (TCT) No. 13733 having bought the property from its owners, brothers Santos and FranciscoYaptengco(Yaptengco brothers), who claimed to have inherited the property from Yap Chin Cun. Bulawan alleged that Yap claimed ownership of the same property and caused the issuance of TCT No. 40292 in Yaps name.

In her Answer, Yap clarified that she asserts ownership of Lot No. 1634-A of Psd-187165, which she claimed is the controlling subdivision survey for Lot No. 1634. Yap also mentioned that, in Civil Case No. 5064, the trial court already declared that Psd-153847 was simulated by the Yaptengco brothers and that their claim on Lot No. 1634-B was void. The trial court likewise adjudged Yap Chin Cunas the rightful owner of Lot No. 1634-B. Yap also stated that Lot No. 1634-B was sold by Yap Chin Cunto the Aquende family.

On 26 November 1996, the trial court ruled in favor of Bulawan.

Yap appealed. On 20 July 2001, the Court of Appeals dismissed Yaps appeal.

On 7 February 2002, the trial courts 26 November 2006 Decision became final and executory per entry of judgment dated 20 July 2001. On 19 July 2002, the trial court issued a writ of execution.

In a letter dated 24 July 2002, the Register of Deeds informed Aquende of the trial courts writ of execution and required Aquende to produce TCT No. 40067 so that a memorandum of the lien may be annotated on the title. On 25 July 2002,Aquende wrote a letter to the Register of Deeds questioning the trial courts writ of execution against his property. Aquende alleged that he was unaware of any litigation involving his property having received no summons or notice thereof, nor was he aware of any adverse claim as no notice of lis pendens was inscribed on the title.

On 2 August 2002,Aquende filed a Third Party Claim against the writ of execution because it affected his property and, not being a party in Civil Case No. 9040, he argued that he is not bound by the trial courts 26 November 1996 Decision. In a letter dated 5 August 2002,the Clerk of Court said that a Third Party Claim was not the proper remedy because the sheriff did not levy upon or seize Aquende's property. Moreover, the property was not in the sheriffs possession and it was not about to be sold by virtue of the writ of execution.

Aquende then filed a Notice of Appearance with Third Party Motion and prayed for the partial annulment of the trial courts 26 November 1996 Decision, specifically the portion which ordered the cancellation of Psd-187165 as well as any other certificate of title issued pursuant to Psd-187165.Aquende also filed a Supplemental Motion where he reiterated that he was not a party in Civil Case No. 9040 and that since the action was in personam or quasi in rem, only the parties in the case are bound by the decision.In its 19 February 2003 Order, the trial court deniedAquendesmotions. According to the trial court, it had lost jurisdiction to modify its 26 November 1996 Decision when the Court of Appeals affirmed said decision.

Thereafter, Aquende filed a petition for annulment of judgment before the Court of Appeals on the grounds of extrinsic fraud and lack of jurisdiction. The Court of Appeals ruled in favor of Aquende.

ISSUE: Did the CA err in taking cognizance of the petition for annulment of judgment?

HELD: In a petition for annulment of judgment, the judgment may be annulled on the grounds of extrinsic fraud and lack of jurisdiction. Fraud is extrinsic where 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.The overriding consideration when extrinsic fraud is alleged is that the fraudulent scheme of the prevailing litigant prevented a party from having his day in court.On the other hand, lack of jurisdiction refers to either lack of jurisdiction over the person of the defending party or over the subject matter of the claim, and in either case the judgment or final order and resolution are void.Where the questioned judgment is annulled, either on the ground of extrinsic fraud or lack of jurisdiction, the same shall be set aside and considered void.

In his petition for annulment of judgment, Aquende alleged that there was extrinsic fraud because he was prevented from protecting his title when Bulawan and the trial court failed to implead him as a party. Bulawan also maintained that the trial court did not acquire jurisdiction over his person and, therefore, its 26 November 1996 Decision is not binding on him. In its 26 November 2007 Decision, the Court of Appeals found merit in Aquende's petition and declared that the trial court did not acquire jurisdiction over Aquende, who was adversely affected by its 26 November 1996 Decision. We find no error in the findings of the Court of Appeals.

Moreover, annulment of judgment is a remedy in law independent of the case where the judgment sought to be annulled was rendered. Consequently, an action for annulment of judgment may be availed of even if the judgment to be annulled had already been fully executed or implemented.

Therefore, the Court of Appeals did not err when it took cognizance of Aquende's petition for annulment of judgment and overturned the trial courts 26 November 1996 Decision even if another division of the Court of Appeals had already affirmed it and it had already been executed. DENIED.