Supreme Court Denies Government Claim Over Lahug, Cebu Property

  • Post last modified:April 9, 2025

MANILA, Philippines — In a decisive ruling on July 31, 2024, the Supreme Court dismissed the Republic of the Philippines’ claim to a 252-square-meter portion of Lot 933 in Lahug, Cebu City, affirming the ownership rights of Spouses Johnny and Chona Yu. The decision, penned by Associate Justice Mario V. Lopez under G.R. No. 239983, rejected the government’s bid for an injunction to stop the couple from building their residential house and upheld the validity of their title, Transfer Certificate of Title (TCT) No. 150040.

The case stemmed from a long-standing dispute over Lot 933, a 37,126-square-meter property within the Banilad Friar Lands Estate, which the government claimed as part of the Camp Lapu-Lapu military reservation. Represented by Major General Dionisio R. Santiago of the Armed Forces of the Philippines (AFP) Visayas Command, the Republic argued that the land was expropriated in 1940 under a Court of First Instance (CFI) decision in Civil Case No. 781, making subsequent titles, including the Yus’, null and void.

The Legal Battle

The Republic filed a complaint in 2001 with the Regional Trial Court (RTC) of Cebu City, seeking to enjoin the Yus from constructing their home and to cancel their title. It alleged that Lot 933 was expropriated in 1938 for public use and that a deposit of PHP 9,500.00 made in 1940 constituted full payment. The RTC sided with the government in 2005, declaring the Yus’ title invalid and granting the injunction.

However, the Court of Appeals (CA) reversed this in 2017, ruling that the expropriation was incomplete due to the government’s failure to prove full payment of just compensation. The CA emphasized that ownership does not transfer without such payment, citing the landmark case Republic v. Lim (2005). The Supreme Court upheld this reversal, dismissing the government’s petition for review on certiorari.

Supreme Court’s Reasoning

The Court, in its 17-page decision, found that the Republic failed to meet the requisites for injunctive relief: a clear and unmistakable right to the property and a material violation of that right. It highlighted several key points:

  1. Incomplete Expropriation: The government could not prove it paid just compensation beyond an initial PHP 9,500.00 deposit, which was for possession, not ownership. Citing Republic v. Lim and San Roque Realty and Development Corporation v. Republic (2007), the Court reiterated that title remains with the landowner until full payment is made.
  2. Failure to Register: Despite the 1940 CFI ruling, the Republic never registered Lot 933 in its name or annotated its claim on the title in over 60 years, undermining its ownership claim. The Torrens system protects registered owners like the Yus, who hold an indefeasible title.
  3. No Evidence of Military Use: The government’s claim that military structures on Lot 933 should have alerted the Yus was unsupported. The Court found no proof of such structures on the specific portion, and even if present, they would not override the strict expropriation process.
  4. Legislative Confirmation: Republic Act No. 9443, enacted in 2007, validated all existing TCTs over the Banilad Friar Lands Estate, including the Yus’ title, effectively sealing the government’s fate.

The Court also rejected the argument that the Yus were not buyers in good faith, noting their title bore no annotations of government claims, and they had secured permits without AFP objection until construction began.

Spouses Yu’s Defense

The Yus maintained they legally purchased the property, paid taxes, and built their home with proper permits. They argued that Lot 933 was never part of Camp Lapu-Lapu and that the government’s inaction for decades—coupled with no record of payment—left ownership with the original owners and their successors. The Court agreed, noting the Yus’ continuous possession and the lack of any registered adverse claim.

Implications

This ruling reinforces the constitutional safeguard that private property cannot be taken for public use without just compensation. It also underscores the Torrens system’s strength, protecting registered owners against unrecorded claims. For the Yus, it secures their home and investment. For the government, it highlights the need to complete expropriation processes diligently, including payment and registration.

The Supreme Court affirmed the CA’s July 19, 2017 decision and May 24, 2018 resolution, ending a decades-long saga over Lot 933 and affirming the Yus’ right to their property as of April 08, 2025.

Disclaimer: This article may have been created with the assistance of artificial intelligence. While efforts have been made to ensure accuracy and clarity, readers are encouraged to verify information independently.