FIRST DIVISION[G.R.No. L-41001. September 30,
1976.]MANILALODGENO.761,BENEVOLENTANDPROTECTIVEORDEROFTHEELKS,
INC.,petitioner,vs.THEHONORABLECOURTOFAPPEALS, CITYOFMANILA, and
TARLAC DEVELOPMENT CORPORATION,respondents.[G.R.No. L-41012.
September 30, 1976.]TARLAC DEVELOPMENT
CORPORATION,petitioner,vs.HONORABLECOURTOFAPPEALS,
CITYOFMANILA,LODGENO.761,BENEVOLENTANDPROTECTIVEORDEROFELKS,
INC.,respondents.Quasha, Asperilla, Zafra, Tayag & Ancheta,
forManilaLodgeNo.761,BenevolentandProtectiveOrderoftheELKS,
Inc.Jose P. Bengzon, Villegas, Zarraga, Narciso &
CudalaandEmmanuel G. Cochico,for Tarlac Development
Corporation.S.M. Artiaga Jr.andRestituto R. Villanueva,
OfficeoftheCity Legal Officerfor CityofManila.D E C I S I O
NCASTRO,Jp:STATEMENTOFTHECASE AND STATEMENTOFTHEFACTSThese two
cases are petitions on certiorari to reviewthedecision dated June
30, 1975oftheCourtofAppealsin CA-G.R.No. 51590-R entitled "Tarlac
Development Corporationvs. CityofManila,
andManilaLodgeNo.761,BenevolentandProtectiveOrderofElks, Inc.,"
affirmingthetrial court's finding in Civil CaseNo. 83009
thattheproperty subjectofthedecisiona quois a "public park or
plaza."LibLexOn June 26, 1905thePhilippine Commission enacted
ActNo. 1.360 which authorizedtheCityofManilato reclaim a
portionofManilaBay.Thereclaimed area was to form partoftheLuneta
extension.TheAct provided thatthereclaimed area "shall
bethepropertyoftheCityofManila" and that "theCityofManilais hereby
authorized to set aside a tractofthereclaimed land formed
bytheLuneta extension . . . atthenorth end not to exceed five
hundred feet by six hundred feet in size, for a hotel site, and to
leasethesame, withtheapprovaloftheGovernor General, to a
responsible person or corporation for a term not to exceed
ninety-ninety years."Subsequently,thePhilippine Commission passed
on May 18, 1907 ActNo. 1657, amending ActNo. 1360, so as to
authorizetheCityofManilaeither to lease or to selltheportion set
aside as a hotel site.Thetotal area reclaimed was a little over 25
hectares.TheCityofManilaapplied fortheregistrationofthereclaimed
area, and on January 20, 1911, O.C.T.No. 1909 was issued
inthenameoftheCityofManila.Thetitle describedtheregistered land as
"un terreno conocido con el nombre de Luneta Extension, situado en
el distrito de la Ermita . . .."Theregistration was "subject,
however, to suchoftheincumbrances mentioned in Article 39 or said
law (Land Registration Act) as may be subsisting" and "sujeto a las
disposiciones y condiciones impuestas en la LeyNo. 1360; y sujeto
tambien a los contratos de venta. celebrados y otorgados por la
Ciudad deManilaa favor del Army and Navy Club y
laManilaLodgeNo.761,BenevolentandProtectiveOrderofElks, fechados
respectivamente, en 29 de Diciembre de 1908 y 16 de Enero de
1909."1On July 13, 1911theCityofManila, affirming a prior sale
dated January 16, 1909, conveyed 5,543.07 square
metersofthereclaimed area
totheManilaLodgeNo.761,BenevolentandProtectiveOrderofElksoftheU.S.A.
(BPOE, for short) onthebasisofwhich TCTNo. 21952was issued
tothelatter overthe"parcela de terreno que es parte de la Luneta
Extension, Situada en el Distrito de la Ermita . . .."
Atthebackofthis title was annotated document 4608/T-1635, which in
part reads as follows: "que la citada Ciudad deManilatendra derecho
a su opcion, de recomprar la expresada propiedad para fines
publicos solamente, en cualquier tiempo despues de cincuenta anos
desde el 13 de Julio de 1911, previo pago a la entidad compradora,
o a sus sucesores del precio de la venta de la misma propiedad, mas
el valor que entonces tengan las
mejoras."FortheremainderoftheLuneta Extension, that is, after
segregating therefromtheportion sold totheManilaLodgeNo.761, BPOE,
a new CertificateofTitleNo. 21963was issued on July 17, 1911
totheCityofManila.ManilaLodgeNo.761, BPOE, subsequently soldthesaid
5,543.07 square meters totheElksClub, Inc., to which was issued
TCTNo. 67488.4Theregistered owner, "TheElksClub, Inc.," was later
changed by courtorderto
"ManilaLodgeNo.761,BenevolentandProtectiveOrderofElks, Inc."In
January 1963theBPOE petitionedtheCourtofFirst InstanceofManila,
Branch IV, forthecancellationoftherightoftheCityofManilato
repurchasetheproperty. This petition was granted on February 15,
1963.On November 19, 1963theBPOE sold forthesumofP4,700,000theland
together with alltheimprovements thereon totheTarlac Development
Corporation (TDC, for short) which paid P1,700,000 as down payment
and mortgaged tothevendorthesame realty to
securethepaymentofthebalance to be paid in quarterly
installments.5Atthetimeofthesale, there wasnoannotationofany
subsisting lien onthetitle totheproperty. On December 12, 1963
TCTNo. 73444 as issued to TDC overthesubject land still described
as "UNA PARCELA DE TERRENO, que es parte de la Luneta Extension,
situada en el Distrito de Ermita . . .."In June
1964theCityofManilafiled withtheCourtofFirst InstanceofManilaa
petition forthereannotationofits right to repurchase;thecourt,
after hearing, issued anorder, dated November 19, 1964,
directingtheRegisterofDeedsoftheCityofManilato reannotatein
tototheentry regardingtherightoftheCityofManilato
repurchasetheproperty after fifty years. From thisorderTDC and BPOE
appealed to this Court which on July 31, 1968 affirmed in G.R.Nos.
L-24557 and L-24469thetrial court'sorderofreannotation, but
reserved to TDCtheright to bring another action
fortheclarificationofits rights.LLphilAs a consequenceofsuch
reservation, TDC filed on April 28, 1971
againsttheCityofManilaandtheManilaLodgeNo.761, BPOE, a complaint,
docketed as Civil CaseNo. 83009oftheCourtofFirst InstanceofManila,
containing three causesofaction and praying "a)Onthefirst
causeofaction, thattheplaintiff TDC be declared to have
purchasedtheparcelofland now in question withthebuildings and
improvements thereon fromthedefendant BPOE for value and in good
faith, and accordingly orderingthecancellationofEntryNo.
4608/T-1635 on Transfer CertificateofTitleNo. 73444
inthenameofthePlaintiff."b)Onthesecond causeofaction,
orderingthedefendantofManilato paytheplaintiff TDC damages
inthesumofnot less than one hundred thousand pesos
(P100,000.00);"c)onthethird causeofaction, reserving totheplaintiff
TDCtheright to recover fromthedefendant BPOEtheamounts mentioned in
par. XVIofthecomplaint in accordance with Art. 1555oftheCivil Code,
intheremote event thatthefinal judgment in this case should be
thattheparcelofland now in question is a public park; and"d)For
costs, and for such other and further relief astheCourt may deem
just and equitable."6Therein defendant CityofManila, in its answer
dated May 19, 1971, admitted allthefacts alleged inthefirst
causeofaction excepttheallegation that TDC purchased said property
"for value and in good faith," but denied for lackofknowledge or
informationtheallegations inthesecond and third causesofaction. As
special and affirmative defense,theCityofManilaclaimed that TDC was
not a purchaser in good faith for it had actual noticeoftheCity's
right to repurchase which was annotated atthebackofthetitle prior
to its cancellation, and that, assumingarguendothat TDC
hadnonoticeoftheright to repurchase, it was, nevertheless, under
obligation to investigate inasmuch as its title recites
thattheproperty is a partoftheLuneta
extension.7TheManilaLodgeNo.761, BPOE, in its answer dated June 7,
1971, admitted having soldtheland together withtheimprovements
thereon for value to therein plaintiff which was in good faith, but
denied for lackofknowledge as to their veracitytheallegations
underthesecond causeofaction. It furthermore admitted that TDC had
paidthequarterly installments until October 15, 1964 but claimed
thatthelatter failed without justifiable cause to paythesubsequent
installments. It also asserted that it was a seller for value in
good faith without having misrepresented or concealed facts
relative tothetitle ontheproperty. As
counterclaim,ManilaLodgeNo.761(BPOE) sought to
recoverthebalanceofthepurchase price plus interest and costs.8On
June 15, 1971 TDC answeredtheaforesaid counterclaim, alleging that
its refusal to make further payments was fully justified.9After due
trialthecourta quorendered on July 14, 1972 its decision
findingthesubject land to be partofthe"public park or plaza" and,
therefore, partofthepublic domain.Thecourt consequently declared
thatthesaleofthesubject land bytheCityofManilatoManilaLodgeNo.761,
BPOE, was null and void; that plaintiff TDC was a purchaser thereof
in good faith and for value from BPOE and can enforce its rights
againstthelatter; and that BPOE is entitled to recover
fromtheCityofManilawhatever consideration it had
paidthelatter.Thedispositive partofthedecision
reads:"WHEREFORE,theCourt hereby declares thattheparcelofland
formerly covered by Transfer CertificateofTitleNos. 2195 and 67488
inthenameofBPOE and now by Transfer CertificateofTitleNo. 73444
inthenameofTarlac Development Corporation is a public park or
plaza, and, consequently, instant complaint is dismissed, without
pronouncement as to costs."In viewofthereservation made by
plaintiff Tarlac Development Corporation to recover from defendant
BPOEtheamounts mentioned in paragraph XVIofthecomplaint in
accordance with Article 1555oftheCivil Code,theCourt
makesnopronouncement on this point."10From said decisionthetherein
plaintiff TDC as well asthedefendantManilaLodgeNo.761, BPOE,
appealed totheCourtofAppeals.In its appeal docketed as CA-G.R.No.
51590-R,theManilaLodgeNo.761, BPOE, avers thatthetrial court
committedthefollowing errors, namely:1.In holding thattheproperty
subjectoftheaction is not patrimonial propertyoftheCityofManila;
and2.In holding thattheTarlac Development Corporation may recover
and enforce its right againstthedefendant BPOE.11TheTarlac
Development Corporation, ontheother hand, asserts thatthetrial
court erred:(1)In finding thattheproperty in question is or was a
public park and in consequently nullifyingthesale thereof
bytheCityofManilato BPOE;(2)In
applyingthecasesofMunicipalityofCavitevs. Rojas, 30 Phil. 602,
andGovernmentvs. Cabangis,53 Phil. 112, tothecase at bar; and(3)In
not holding thattheplaintiff-appellant is entitled to recover
damages fromthedefendant CityofManila.12Furthermore, TDC, as
appellee regardingthesecond assignmentoferror raised by BPOE,
maintained that it can recover and enforce its right against BPOE
intheevent thattheland in question is declared a public park or
part thereof.13In its decision promulgated on June 30,
1975,theCourtofAppealsconcurred inthefindings and
conclusionsofthelower court upontheground that they are supported
bytheevidence and are in accordance with law, and accordingly
affirmedthelower court's judgment.Hence,thepresent petitions for
review on certiorari.G.R.No. L-41001TheManilaLodgeNo.761, BPOE,
contends, in its petition for review on certiorari docketed as
G.R.No. L-41001, thattheCourtofAppealserred in (1)
disregardingthevery enabling acts and/or statutes according to
whichthesubject property was, and still is, patrimonial
propertyoftheCityofManilaand could therefore be sold and/or
disposedoflike any other private property; and (2) in departing
fromtheaccepted and usual courseofjudicial proceedings when it
simply made a general affirmanceofthecourta quo'sfindings and
conclusions without bothering to discuss or resolve several vital
points stressed bytheBPOE in its assigned errors.14G.R.No.
L-41012TheTarlac Development Corporation, in its petition for
review on certiorari docketed as G.R.No. L-41012, relies
onthefollowing grounds fortheallowanceofits
petition:1.thattheCourtofAppealsdid not correctly interpret ActNo.
1360, as amended by ActNo. 1657,ofthePhilippine Commission;
and2.thattheCourtofAppealshas departed fromtheaccepted and usual
courseofjudicial proceedings in that it did not make its own
findings but simply recited thoseofthelower court.15ISSUES AND
ARGUMENTSFIRST ISSUEUponthefirst issue, both petitioners claim
thattheproperty subjectoftheaction, pursuant
totheprovisionsofActNo. 1360, as amended by ActNo. 1657, was
patrimonial propertyoftheCityofManilaand not a park or
plaza.ArgumentsofPetitionersIn G.R.No.
L-41001,theManilaLodgeNo.761, BPOE, admits that "there appears to
be some logic intheconclusion"oftheCourtofAppealsthat "neither
ActNo. 1360 nor ActNo. 1657 could have meant to
supplytheCityofManilatheauthority to sellthesubject property which
is located atthesouth end notthenorth ofthereclaimed area."16It
argues, however, that when ActNo. 1360, as amended,
authorizedtheCityofManilato undertaketheconstructionoftheLuneta
extension by reclaiming land fromtheManilaBay, and declared
thatthereclaimed land shall
bethe"propertyoftheCityofManila,"theState expressly
grantedtheownership thereof totheCityofManilawhich. consequently,
could enter into transactions involving it; that
upontheissuanceofO.C.T.No. 1909, there could benodoubt
thatthereclaimed area owned bytheCity was its patrimonial
property;17thatthesouth endofthereclaimed area could not be for
public use for. as argued by TDC, a street, park or promenade can
be property for public use pursuant to Article 344oftheSpanish
Civil Code only when it has already been so constructed or laid
out, andthesubject land, atthetime it was sold totheElk's Club, was
neither actually constructed as a street, park or promenade nor
laid out as a street, park or promenade;18that even assuming
thatthesubject property was atthebeginning propertyofpublic
dominion, it was subsequently converted into patrimonial property
pursuant to Art. 422oftheCivil Code, inasmuch as ithad never been
used, regarded, or utilized since it was reclaimedin 1905 for
purposes other than thatofan ordinary real estate for sale or
lease; thatthesubject property had never been intended for public
use, is further shown bythefact that it was neither included as a
partoftheLuneta Park under PlanNo. 30oftheNational Planning
Commission nor considered a partoftheLuneta National Park (now
Rizal Park) by ProclamationNo. 234 dated December 19,
1955ofPresident Ramon Magsaysay or by ProclamationOrderNo. 274
dated October 4, 1967ofPresident Ferdinand E. Marcos;19that, such
beingthecase, there isnoreason whythesubject property should not be
considered as having been converted into patrimonial property,
pursuant totheruling inMunicipalityvs. Roa, 7 Phil. 20, inasmuch
astheCityofManilahas considered it as its patrimonial property not
only bringing it undertheoperationoftheLand Registration Act but
also by disposingofit;20and that to consider nowthesubject property
as a public plaza or park would not only
impairtheobligationsoftheparties tothecontractofsale dated July 13,
1911, but also authorize deprivationofproperty without due
processoflaw.21G.R.No. L-41012In L-41012,thepetitioner TDC stresses
thattheprincipal issue istheinterpretationofActNo. 1360, as amended
by ActNo. 1657ofthePhilippine Commission,22and avers that inasmuch
as Section 6ofActNo. 1360, as amended by Act 1657, provided
thatthereclamationoftheLuneta extension was to be paid for
outofthefundsoftheCityofManilawhich was authorized to borrow
P350,000 "to be expended intheconstructionofLuneta
Extension,"thereclaimed area became "public land" belonging
totheCityofManilathat spent forthereclamation, conformably
totheholding inCabangis,23and consequently, said land was subject
to sale and other disposition; thattheInsular Government itself
consideredthereclaimed Luneta extension as patrimonial property
subject to disposition as evidenced bythefact that Sec. 3ofAct 1360
declared that "theland hereby reclaimed shall
bethepropertyoftheCityofManila;" that this property cannot be
property for public use for, according to Article 344oftheCivil
Code,thecharacterofproperty for public use can only attach to roads
and squares that have already been constructed or at least laid out
as such, which conditions did not obtain regardingthesubject land;
that Sec. 5ofAct 1360 authorizedtheCityofManilato leasethenorthern
partofthereclaimed area for hotel purposes; that ActNo. 1657
furthermore authorizedtheCityofManilato
sellthesame;24thattheexpress statutory authority to lease or
sellthenorthern partofthereclaimed area cannot be interpreted to
mean thattheremaining area could not be sold inasmuch
asthepurposeofthestatute was not merely to confer authority to
sellthenorthern portion but rather to limitthecity's
powerofdisposition thereof, to wit: to prevent
dispositionofthenorthern portion for any purpose other than for a
hotel site;25thatthenorthern and southern endsofthereclaimed area
cannot be considered as extensionoftheLuneta for they lie
beyondthe-sidesoftheoriginal Luneta when extended
inthedirectionofthesea, and that isthereason whythelaw
authorizedthesaleofthenorthern portion for hotel purposes, and,
forthesame reason, it is implied thatthesouthern portion could
likewise be disposedof.26TDC argues likewise that there are several
itemsofuncontradicted circumstantial evidence which may serve as
aids in construingthelegislative intent and which demonstrate
thatthesubject property is patrimonial in nature, to wit: (1)
Exhibits "J" and "J-1", or PlanNo. 30oftheNational Planning
Commission showingtheLuneta and its vicinity, do not
includethesubject property as partoftheLuneta Park; (2) Exhibit
"K", which istheplanofthesubject property covered by TCTNo.
67488ofBPOE, prepared on November 11, 1963, indicates that said
property is not a public park; (3) Exhibit "T", which is a
certified copyofProclamationNo. 234 issued on December 15, 1955 by
President Magsaysay, and Exhibit "U" which is ProclamationOrderNo.
273 issued on October 4, 1967 by President Marcos, do not
includethesubject property intheLuneta Park; (4) Exhibit "W", which
isthelocation planoftheLuneta National Park under ProclamationsNos.
234 and 273, further confirms thatthesubject property is not a
public park; and (5) Exhibit "y", which is a copyofO.C.T.No. 7333
inthenameoftheUnited StatesofAmerica coveringtheland now occupied
bytheAmerican Embassy,theboundariesofwhich were delineated
bythePhilippine Legislature, states thatthesaid land is bounded
onthenorthwest by propertiesoftheArmy and Navy Club (BlockNo. 321)
andtheElksClub (BlockNo. 321), and this circumstance shows that
eventhePhilippine Legislature recognizedthesubject property as
private propertyoftheElksClub.27TDC furthermore contends
thattheCityofManilais estopped from
questioningthevalidityofthesaleofthesubject property that it
executed on July 13, 1911 totheManilaLodgeNo.761, BPOE, for several
reasons, namely: (1)theCity's petition forthereannotationofEntryNo.
4608/T-1635 was predicated onthevalidityofsaid sale; (2)
whentheproperty was bought bythepetitioner TDC it was not a public
plaza or park as testified to by both Pedro Cojuangco,
treasurerofTDC, andthesurveyor, Manuel Aonuevo; (4)theproperty was
never used as a public park, for, sincetheissuanceofT.C.T.No. 2165
on July 17, 1911 inthenameoftheManilaLodgeNO.761,thelatter used it
as private property, and as early as January 16,
1909theCityofManilahad already executed a deedofsale
overtheproperty in favoroftheManilaLodgeNo.761; and
(5)theCityofManilahas not presented any evidence to show
thatthesubject property has ever been proclaimed or used as a
public park.28TDC, moreover, contends that Sec. 60ofCom. ActNo. 141
cannot apply tothesubject land, for Com. ActNo. 141 took effect on
December 1, 1936 and at that timethesubject land wasnolonger
partofthepublic domain.29TDC also stresses that its rights as a
purchaser in good faith cannot be disregarded, forthemere mention
inthecertificateoftitle thatthelot it purchased was
"partoftheLuneta extension" was not a sufficient warning
thatthetitleoftheCityofManilawas invalid; and that althoughthetrial
court, in its decision affirmed bytheCourtofAppeals, foundtheTDC to
have been an innocent purchaser for value,thecourt
disregardedthepetitioner's rights as such purchaser that relied on
a Torrens certificateoftitle.30TheCourt, continuesthepetitioner
TDC, erred in not holding thatthelatter is entitled to recover
fromtheCityofManiladamages intheamountofP100,000 caused bytheCity's
petition for reannotationofits right to repurchase.DISCUSSION AND
RESOLUTIONOFFIRST ISSUEIt is a cardinal ruleofstatutory
construction that courts must give effect tothegeneral legislative
intent that can be discovered from or is unraveled bythefour
cornersofthestatute,31and inorderto discover said intent,thewhole
statute, and not only a particular provision thereof, should be
considered.32It is, therefore, necessary to analyze
alltheprovisionsofActNo. 1360, as amended, inorderto
unravelthelegislative intent.ActNo. 1360 which was enacted
bythePhilippine Commission on June 26, 1905, as amended by ActNo.
1657 enacted on May 18, 1907, authorizedthe"constructionofsuch rock
and timber bulkheads or sea walls as may be necessary
forthemakingofan extension totheLuneta" (Sec. 1[a]),
andtheplacingofthematerial dredged
fromtheharborofManila"insidethebulkheads constructed to
inclosetheLuneta extension above referred to" (Sec. 1[c]). It
likewise provided thattheplanofArchitect D. H. Burnham as "a
general outline fortheextension and improvementoftheLuneta
intheCityofManila" be adopted; that "thereclamation
fromtheBayofManilaoftheland included in said projected Luneta
extension . . . is hereby authorized andtheland thereby reclaimed
shall bethepropertyoftheCityofManila" (Sec. 3); that
"theCityofManilais hereby authorizedto set aside a
tractofthereclaimed land formed bytheLuneta extension authorized by
thisAct atthenorth endofsaid tract, not to exceed five hundred feet
by six hundred feet in size,for a hotel site, and to
leasethesamewiththeapprovaloftheGovernor General, . . . for a term
not exceeding ninety-nine years;" that "shouldtheMunicipal Board .
. . deem it advisable it ishereby authorized to advertise for sale
to sell said tractofland. . .;" "that said tract shall be used for
hotel purposes as herein prescribed, and shall not be devoted to
any other purpose or object whatever;" "that shouldthegrantee . . .
fail to maintain on said tract a first-class hotel . . .
thenthetitle to said tractofland sold, conveyed, and transferred
tothegrantee shall revert totheCityofManila,and said
CityofManilashall thereupon become entitled totheimmediate
possessionofsaid tractofland" (Sec. 3);
thattheconstructionoftherock and timber bulkheads or sea wall
"shall be paid for outofthefundsoftheCityofManila, butthearea to be
reclaimed by said proposed Luneta extension shall be filled,
without cost totheCityofManila, with material dredged fromManilaBay
attheexpenseoftheInsular Government" (Sec. 6); and that
"theCityofManilais hereby authorized to borrow fromtheInsular
Government . . .thesumofthree hundred thousand pesos, to be
expended intheconstructionoftheLuneta extension provided for by
paragraph (a)ofsection one hereof" (Sec. 7).Thegrant made by ActNo.
1360ofthereclaimed land totheCityofManilais a grantofa "public"
nature,thesame having been made to a local political subdivision.
Such grants have always beenstrictlyconstrued
againstthegrantee.33One compelling reason given forthestrict
interpretationofa public grant is that there is in such grant a
gratuitous donationof, public money or resources which results in
an unfair advantage tothegrantee and for that reason,thegrant
should be narrowly restricted in favorofthepublic.34This reason for
strict interpretation obtains relative totheaforesaid grant for
althoughtheCityofManilawas to pay fortheconstructionofsuch work and
timber bulkheads or sea walls as may be necessary
forthemakingoftheLuneta extension,thearea to be reclaimed would be
filled attheexpenseoftheInsular Government and without cost
totheCityofManila, with material dredged fromManilaBay.
Hence,theletterofthestatute should be narrowed to exclude matters
which if included would
defeatthepolicyofthelegislation.cdllThereclaimed area, an extension
totheLuneta, is declared to be propertyoftheCityofManila. Property,
however, is eitherofpublic ownership orofprivate ownership.35What
kindofpropertyoftheCity isthereclaimed land? Is itofpublic
ownership (dominion) orofprivate ownership?We hold that it
isofpublic dominion, intended for public use.Firstly,
ifthereclaimed area was granted totheCityofManilaas its patrimonial
property,theCity could, by virtueofits ownership, disposeofthewhole
reclaimed area without needofauthorizationto do so fromthelawmaking
body. Thus Article 348oftheCivil CodeofSpain provides that
"ownership istheright to enjoy and disposeofa thing without further
limitations than those established by law."36Theright to dispose
(jus disponendi)ofone's property is an attributeofownership. ActNo.
1360, as amended, however, provides by necessary implication,
thattheCityofManilacould not disposeofthereclaimed area without
beingauthorizedbythelawmaking body. Thusthestatute provides that
"theCityofManilaishereby authorizedto set aside a tract . . .
atthenorth end, for a hotel site, and to leasethesame . . .
shouldthemunicipal board . . . deem it advisable, it ishereby
authorized. . . to sell said tractofland . . ." (Sec. 5).
Ifthereclaimed area were patrimonial propertyoftheCity,thelatter
could disposeofit without needoftheauthorization provided
bythestatute, andtheauthorization to set aside . . . lease . . . or
sell . . . given bythestatute would indeed be superfluous. To so
construethestatute as to rendertheterm "authorize," which is
repeatedly used bythestatute, superfluous would
violatetheelementary ruleoflegal hermeneutics that effect must be
given to every word, clause, and sentenceofthestatute and that a
statute should be so interpreted thatnopart thereof becomes
inoperative or superflous.37To authorize means to empower, to give
a right to act.38ActNo. 1360 furthermore qualifiestheverb
"authorize" withtheadverb "hereby," which means "by meansofthis
statue or section." Hence withouttheauthorization expressly given
by ActNo. 1360,theCityofManilacould not lease or sell
eventhenorthern portion; much less could it disposeofthewhole
reclaimed area. Consequently,thereclaimed area was granted
totheCityofManila, not as its patrimonial property. At most,
onlythenorthern portion reserved as a hotel site could be said to
be patrimonial property, for, by express statutory provision it
could be disposedof, andthetitlethereto would revert totheCity
shouldthegrantee fail to comply withtheterms provided
bythestatute.LLprTDC, however, contends
thatthepurposeoftheauthorization provided in ActNo. 1360 to lease
or sell was really to limittheCity's powerofdisposition. To sustain
such contention is to begthequestion. Ifthepurposeofthelaw was to
limittheCity's powerofdisposition, then it is necessarily assumed
thattheCity had alreadythepower to dispose, for if such power did
not exist, how could it be limited? It was precisely Act 1360 that
gavetheCitythepower to dispose for it was "herebyauthorized" by
lease or sale. Hence,theCityofManilahadnopower to
disposeofthereclaimed land had such power not been granted by
ActNo. 1360, andthepurposeoftheauthorization was to empowerthecity
to sell or leasethenorthern part and not, as TDC claims, to limit
onlythepower to dispose. Moreover, it is presumed that
whenthelawmaking body enactedthestatute, it had full
knowledgeofprior and existing laws and legislation
onthesubjectofthestatute and acted in accordance or with respect
thereto.39If by another previous law,theCityofManilacould already
disposeofthereclaimed area, which it could do if such area were
given to it as its patrimonial property, would it then not be a
superfluity for ActNo. 1360 toauthorizetheCity to
disposeofthereclaimed land? Neither has petitioner TDC pointed to
any other law that authorizedtheCity to do so, nor have we come
across any. What we do know is that ifthereclaimed land were
patrimonial property, there would benoneedofgiving special
authorization totheCity to disposeofit. Said authorization was
given becausethereclaimed land was not intended to be patrimonial
propertyoftheCityofManila, and withouttheexpress authorization to
disposeofthenorthern portion,theCity could not disposeofeven that
part.LibLexSecondly,thereclaimed area is an "extension totheLuneta
intheCityofManila."40Ifthereclaimed area is an
extensionoftheLuneta, then it isofthesame nature or character
astheold Luneta. Anent this matter, it has been said that a power
to extend (or continue an act or business) cannot authorize a
transaction that is totally distinct.41It is not disputed
thattheold Luneta is a public park or plaza and it is so considered
by Section 859oftheRevised
OrdinancesoftheCityofManila.42Hencethe"extension totheLuneta" must
be also a public park or plaza and for public use.TDC, however,
contends thatthesubject property cannot be considered an
extensionoftheold Luneta because it is outsideofthelimitsoftheold
Luneta when extended tothesea. This is a strained
interpretationoftheterm "extension," for an "extension," it has
been held, "signifies enlargement in any direction in length,
breadth, or circumstance."43Thirdly,thereclaimed area was formerly
a partoftheManilaBay. A by is nothing more than an inletofthesea.
Pursuant to Article 1oftheLawofWatersof1866, bays, roadsteads,
coast sea, inlets and shores are partsofthenational domain open to
public use. These are also propertyofpublic ownership devoted to
public use, according to Article 339oftheCivil
CodeofSpain.Whentheshore or partofthebay is reclaimed, it does not
lose its characterofbeing property for public use, according
toGovernmentofthePhilippine Islandsvs.
Cabangis.44Thepredecessoroftheclaimants in this case wastheownerofa
big tractofland includingthelots is question. From 1896 said land
began to wear away due totheactionofthewaterofManilaBay. In
1901thelots in question became completely submerged in water in
ordinary tides. It remained in such a state until 1912
whentheGovernment undertookthedredgingoftheVitas estuary and
dumpedthesand and silt from estuary onthelow lands completely
submerged in water, thereby gradually formingthelots in question.
Tomas Cabangis took possession thereof as soon as they were
reclaimed; hence,theclaimants, his successors in interest, claimed
thatthelots belonged to them.Thetrial court found fortheclaimants
andtheGovernment appealed. This Court held that whenthelots became
a partoftheshore. As they remained in that condition until
reclaimed bythefilling done bytheGovernment, they belonged
tothepublic domain for public use.45Hence, a partoftheshore, and
for that purpose, a partofthebay, did not lose its characterofbeing
for public use after it was reclaimed.Fourthly, Act 1360, as
amended, authorizedthelease or saleofthenorthern
portionofthereclaimed area as a hotel site.Thesubject property is
not that northern portion authorized to be leased or
sold;thesubject property isthesouthern portion. Hence,
applyingtheruleofexpresio unius est exlusio
alterius,theCityofManilawas not authorized to sellthesubject
property.Theapplicationofthis principleofstatutory construction
becomesthemore imperative inthecase at bar inasmuch as not only
mustthepublic grantofthereclaimed area totheCityofManilabe, as
above stated, strictly construed againsttheCityofManila, but also
because a grantofpower to a municipal corporation, as happens in
this case wherethecity is authorized to lease or sellthenorthern
portionoftheLuneta extension, is strictly limited to such as are
expressly or impliedly authorized or necessarily incidental
totheobjectivesofthecorporation.Fifthly, Article 344oftheCivil
CodeofSpain provides that "propertyofpublic use, in provinces and
in towns, comprisestheprovincial and town roads,thesquares,
streets, fountains, and public waters,thepromenades, and public
worksofgeneral service paid for by such towns or provinces." A park
or plaza, such astheextension totheLuneta, is undoubtedly comprised
in said article.Thepetitioners, however, argue that, according to
said Article 344, inorderthatthecharacterofproperty for public use
may be so attached to a plaza,thelatter must be actually
constructed or at least laid out as such, and sincethesubject
property was not yet constructed as a plaza or at least laid out as
a plaza when it was sold bytheCity, it could not be property for
public use. It should be noted, however, that propertiesofprovinces
and towns for public use are governed bythesame principles as
propertiesofthesame character belonging tothepublic
domain.46Inorderto be propertyofpublic domain an intention to
devote it to public use is sufficient.47Thepetitioners' contention
is refuted by Manresa himself who said, in his comments48on Article
344, that:"Las plazas, calles y paseos publicos corresponden, sin
duda alguna, aldominio publicomunicipal, porque se hallan
establecidos sobre suelo municipal y estan destinadas al uso de
todos. Laurent presenta, tratando de las Plazas, una cuestion
relativa a si deben conceptuarse como de dominio publico los
lugares vacios, libres, que se encuentran en los Municipios
rurales. . . . Laurent opina contra Proudhon, que toda vez que
estan al servicio de todos esos lugares, deben considerarse
publicos y de dominio publico. Realmente, para decidir el punto,
bastara siempre fijarse en el destino real y efectivo de los
citados lugares, y si este destino entraa un uso comun de
todos,nohay duda que son de dominio municipal sinopatrimoniales."It
is not necessary, therefore, that a plaza be already construed or
laid out as a plaza inorderthat it be considered property for
public use. It is sufficient that it be intended to be such.
Inthecase at bar, it has been shown thattheintentionofthelawmaking
body in giving totheCityofManilatheextension totheLuneta was not a
grant to itofpatrimonial property but a grant for public use as a
plaza.We have demonstratedad satietatemthattheLuneta extension was
intended to be propertyoftheCityofManilafor public use. But, could
not said property later on be converted, asthepetitioners contend,
to patrimonial property? It could be. But this Court has already
said, inIgnaciovs.TheDirectorofLands,49that it is onlytheexecutive
and possiblythelegislative department that hastheauthority
andthepower to makethedeclaration that said property isnolonger
required for public use, and until such declaration is
madetheproperty must continue to form partofthepublic domain.
Inthecase at bar, there has beennosuch explicit or unequivocal
declaration. It should be noted, furthermore, anent this matter,
that courts are undoubtedly not primarily called upon, and are not
in a position, to determine whether any public land is still needed
forthepurposes specified in Article 4oftheLawofWaters.50Having
disposedofthepetitioners' principal arguments relative tothemain
issue, we now pass totheitemsofcircumstantial evidence which TDC
claims may serve as aids in construingthelegislative intent
intheenactmentofActNo. 1360, as amended. It is noteworthy that all
these itemsofalleged circumstantial evidence are acts far removed
in time fromthedateoftheenactmentofActNo. 1360 such that they
cannot be considered contemporaneous with its enactment. Moreover,
it is not far-fetched that this massofcircumstantial evidence might
have been influenced bytheantecedent seriesofinvalid acts, to
wit:theCity's having obtained overthereclaimed area OCTNo. 1909 on
January 20, 1911;thesale made bytheCityofthesubject property
toManilaLodgeNo.761; andtheissuance tothelatterofT.C.T.No. 2195. It
cannot be gainsaid that ifthesubsequent acts
constitutingthecircumstantial evidence have been based on, or at
least influenced, by those antecedent invalid acts and Torrens
titles, they can hardly be indicativeoftheintentofthelawmaking body
in enacting ActNo. 1360 and its amendatory act.LexLibTDC claims
that Exhs. "J," "J-1," "K," "T," "U," "W" and "Y" show
thatthesubject property is not a park.Exhibits "J" and
"J-1,"the"Luneta and vicinity showing proposed development" dated
May 14, 1949, were prepared bytheNational Urban Planning
CommissionoftheOfficeofthePresident. It cannot be reasonably
expected that this plan for developmentoftheLuneta should show
thatthesubject property occupied bytheElksClub is a public park,
for it was made 38 years afterthesale totheElks, and after
T.C.T.No. 2195 had been issued toElks. It is to be assumed
thattheOfficeofthePresident was cognizantoftheTorrens titleofBPOE.
Thatthesubject property was not included as a partoftheLuneta only
indicates thattheNational Urban Planning Commission that
madetheplan knew thatthesubject property was occupied byElksand
thatElkshad a Torrens title thereto. But this innoway proves
thatthesubject property was originally intended to be patrimonial
propertyoftheCityofManilaor thatthesale toElksor thattheTorrens
titleofthelatter is valid.Exhibit "K" isthe"Planofland covered by
T.C.T.No. ____, as prepared for Tarlac Development Company." It was
made on November 11, 1963 by Felipe F. Cruz, private land surveyor.
This surveyor is admittedly a surveyor for TDC.51This plan cannot
be expected to show thatthesubject property is a partoftheLuneta
Park, fortheplan was made to showthelot that "was to be sold to
petitioner " This plan must have also assumedtheexistenceofa valid
title totheland in favorofElks.Exhibits "T" and "U" are
copiesofPresidential ProclamationsNo. 234 issued on November 15,
1955 andNo. 273 issued on October 4, 1967,
respectively.Thepurposeofthesaid Proclamations was to reserve
certain parcelsofland situated intheDistrictofErmita, CityofManila,
for park site purposes. Assuming thatthesubject property is not
withintheboundariesofthereservation, this cannot be interpreted to
mean thatthesubject property was not originally intended to be for
public use or that it has ceased to be such. Conversely
hadthesubject property been included inthereservation, it would not
mean, if it really were private property, thattherightsoftheowners
thereof would be extinguished, forthereservations was "subject to
private rights, if any there be." Thatthesubject property was not
included inthereservation only indicates thatthePresident
knewoftheexistenceoftheTorrens titles mentioned
above.ThefailureoftheProclamations to includethesubject property
inthereservation for park site could not
changethecharacterofthesubject property as originally for public
use and to form partoftheLuneta Park. What has been said here
applies to Exhibits "V", "V-1" to "V-3," and "W" which also refer
tothearea and locationofthereservation fortheLuneta
Park.LLjurExhibit "Y" is a copyofO.C.T.No. 7333 dated November 13,
1935, coveringthelot where now standstheAmerican Embassy
[Chancery]. It states thattheproperty is "bounded . . .
ontheNorthwest by propertiesofArmy and Navy Club (BlockNo. 321)
andElksClub (BlockNo. 321)." Inasmuch asthesaid boundaries were
delineated bythePhilippine Legislature in ActNo.
4269,thepetitioners contend thattheLegislature "recognized and
concededtheexistenceoftheElksClub property as a private property
(theproperty is question) and not as a public park or plaza. This
argument isnon sequitur, plain and simple. Said Original
CertificateofTitle cannot be considered as an inconvertible
declaration thattheElksClub was in truth and in facttheownerofsuch
boundary lot. Such mention as boundary owner is not a
meansofacquiring title nor can it validate a title that is null and
void.TDC finally claims thattheCityofManilais estopped from
questioningthevalidityofthesale it executed on July 13, 1911
conveyingthesubject property totheManilaLodgeNo.761, BPOE. This
contention cannot be seriously defended inthelightofthedoctrine
repeatedly enunciated by this Court thattheGovernment is never
estopped by mistakes or errors onthepart.ofits agents, and estoppel
does not apply to a municipal corporation to validate a contract
that is prohibited by law or its against public policy,
andthesaleofJuly 13, 1911 executed
bythecityofManilatoManilaLodgewas certainly a contract prohibited
by law. Moreover, estoppel cannot be urged even
iftheCityofManilaacceptedthebenefitsofsuch contractofsale
andtheManilaLodgeNo.761had performed its partoftheagreement, for to
applythedoctrineofestoppel againsttheCityofManilain this case would
be tantamount to enabling it to do indirectly what it could not do
directly.52Thesaleofthesubject property executed
bytheCityofManilatotheManilaLodgeNo.761, BPOE, was void and
inexistent for lackofsubject matter.53It suffered from an incurable
defect that could not be ratified either by lapseoftime or by
express ratification.TheManilaLodgeNo.761therefore acquirednoright
by virtueofthesaid sale. Hence to consider nowthecontract
inexistent as it always has been, cannot be, as claimed
bytheManilaLodgeNo.761, an impairmentoftheobligationsofcontracts,
for there was in contemplationoflaw,nocontract at
all.CdprTheinexistenceofsaid sale can be set up against anyone who
asserts a right arising from it, not only againstthefirst
vendee,theManilaLodgeNo.761, BPOE, but also against all its
successors, including,theTDC, which are not protected by
law.54Thedoctrineofbona fidepurchaser without notice, being claimed
bytheTDC, does not apply where there is a total absenceoftitle
inthevendor, andthegood faithofthepurchaser TDC cannot create title
where none exists.55Theso-called saleofthesubject property having
been executed,therestoration or restitutionofwhat has been given is
inorder.56SECOND ISSUEThesecond ground alleged in
supportoftheinstant petitions for review on certiorari is
thattheCourtofAppealshas departed fromtheaccepted and usual
courseofjudicial proceedings as to call for an
exerciseofthepowerofsupervision TDC, in L-41012, argues
thattherespondent Court did not make its own findings but simply
recited thoseofthelower court and made a general affirmance,
contrary totherequirementsoftheConstitution; thattherespondent
Court made glaring and patent mistakes in recounting eventhecopied
findings, palpably showing lackofdeliberate
considerationofthematters involved, as, for example, when said
court said that ActNo. 1657 authorizedtheCityofManilato set aside a
portionofthereclaimed land "formed bytheLuneta Extension or to
lease or sellthesame for park purposes;" and that respondent Court,
furthermore, did not resolve or disposeofanyoftheassigned errors
contrary tothemandateoftheJudiciary Act.57TheManilaLodgeNo.761, in
L-41001, likewise alleges, as oneofthereasons warranting review,
thattheCourtofAppealsdeparted fromtheaccepted and usual
courseofjudicial proceedings by simply making a general
affirmanceofthecourta quo'sfindings without bothering to resolve
several vital points mentioned bytheBPOE in its assigned
errors.58COMMENTS ON SECOND ISSUEWe have shown in our
discussionofthefirst issue thatthedecisionofthetrial court is fully
in accordance with law. It follows that when such decision was
affirmed bytheCourtofAppeals,theaffirmance was likewise in
accordance with law. Hence,nouseful purpose will be served in
further discussingthesecond
issue.CONCLUSIONACCORDINGLY,thepetitions in both G.R.Nos. L-41001
and L-41012 are denied for lackofmerit,
andthedecisionoftheCourtofAppealsofJune 30, 1975, is hereby
affirmed, at petitioners' cost.Makasiar, Muoz PalmaandMartin,
JJ.,concur.Teehankee, J.,concurs intheresult which is wholly
consistent withthebasic rulings and judgmentofthis Court in its
decisionofJuly 31, 1968.Footnotes1.Exh. "H," Exh. "13-Elks."2.Exh.
"I."3.Exh. "X."4.Exh. "B".5.Exh. "C."6.Joint Record on
AppealofthePlaintiff
andtheDefendantManilaLodgeNo.761,BenevolentandProtectiveOrderofElks,
Inc., pp. 33-34.7.Ibid., pp. 49-63.8.Ibid., pp. 64-71.9.Ibid.,pp.
87-88.10.Ibid.,pp.92-110.11.Record, L-41001, p. 7.12.Record,
L-41012, p. 11; Brief for Plaintiff-Appellant in CA-G.R.No.
51590-R, pp. 1-2.13.Brief forthePlaintiff-Appellant Tarlac
Development Corporation in CA-G.R.No. 51590-R, p. 2.14.Record,
L-41001. pp. 14-16.15.Record, L-41012, pp. 16, 46.16.L-41001,
Record, p. 17.17.Ibid.,p. 19.18.Ibid.,pp. 19-20.19.Ibid.,p.
21.20.Ibid.,pp. 21-22.21.Ibid.,pp. 22-23.22.L-41012, Record, pp.
16-17.23.53 Phil. 112 (1930).24.L-41012, Record, pp. 22-23,
25-26.25.Ibid.,pp. 23-25.26.Ibid.,pp. 27-28.27.Ibid.,pp.
28-34.28.Ibid.,pp. 34-41.29.Ibid.,pp. 42-43.30.Ibid.,pp.
44-45.31.Borromeovs. Mariano, 41 Phil. 322.32.Aboitiz Shipping
Corporationvs.TheCityofCebu, L-14526, March 31, 1965, 13 SCRA 449,
453.33.Sutherland,Statutes and Statutory Construction,3rd ed., vol.
II, p. 240.34.Ibid.,Vol. III, pp. 204-208.35.Art. 338, Civil
CodeofSpain; Art. 419ofthePhilippines provides: "Property is
eitherofpublic dominion orofprivate ownership.".36.Art. 428, Civil
Code.37.Sutherland,op. cit.,p. 339.38.4 Words and Phrases, p. 830,
citing Statevs. BoardofCom'rsofFranklin County, 114 p. 247, 248; 24
Kan. 404.39.Tamiami Trial Toursvs. Lee, 194 So. 305, 306.40.Sec. 1,
Act.No. 1360.41.See 15-A Words and Phrases, p. 602, citing
Clements' Ex'rsvs. Dickey, 5 Fed. Cas. 1025,
1027.42.BureauofPrinting, 1908, p. 281.43.15-A Words and Phrases,
p. 614, citing Mayor, etc.ofMonroevs. Quachita Parish, 17 So. 498,
499, 47 La. Ann. 1061.44.53 Phil. 112.45.Syllabus, citing Aragonvs.
Insular Government, 19 Phil. 223; Franciscovs.
GovernmentofthePhilippine Islands, 28 Phil. 505.46.Viuda de Tan
Tocovs. Municipal CouncilofIloilo, 49 Phil. 52, 55.47.Art. 420,
Civil Code.48.3 Codigo Civil Espaol, 6a edicion, p. 106.49.108
Phil. 335, 339.50.Monteverdevs. DirectorofLands, 93 Phil. 134,
cited in Ignaciovs.TheDirectorofLands,supra.51.L-41012, Record, p.
29.52.Republicvs. Go Bon Lee, L-11499, April 29, 1961, 1 SCRA 1166,
1170; Go Tian Anvs. Republic, L-19833, August 31, 1966, 17 SCRA
1053, 1055; Pechueco Sons Companyvs. Provincial BoardofAntique,
L-27038, January 30, 1970, 31 SCRA 320, 327, citing San Diegovs.
MunicipalityofNaujan, L-9920, 29 February 1960, cited in Favisvs.
MunicipalityofSabangan, L-26522, 27 February 1969, 27 SCRA 92; see
also CityofManilavs. Tarlac Development Corporation, L-24557,
L-24469 and L-24481, 31 July 1968, 24 SCRA 466.53.Arts. 1409 and
1458, Civil Code.54.4 Tolentino, Civil Code, p. 575, citing 1 Von
Tuhr,Obligaciones,p. 164.55.92 CJS p. 219, citing Chestnutvs.
Weekes, 188 S.E. 714, 183 Ga. 367; Bradburyvs. Green, 351 p. 2d
807, 207 Okl. 586; Noblevs. Kahn, 240 P. 2d 757, 206 Okl. 13, 35
A.L.R. 2d 119.56.4 Tolentino, Civil Code, p. 576, citing Perez
Gonzales and Alguer; I-II Enneccerus, Kipp and Wolff, 364-366; 3
Von Tuhr 311; 3 Fabres 231. See also 92 CJS p. 550, citing Bologna
Bros.vs. Stephens, 18 So. 2d 944, 206 La. 112; Partlowvs. Mulligan,
76 N.Y.S. 2d 181.57.L-41012, Record pp. 40-49.58.L-41001, Record,
p. 15.|||(Manila Lodge No. 761 v. Court of Appeals, G.R. No.
L-41001, L-41012, September 30, 1976)