Spec Pro Class 2020

Facts:

The property in dispute was among the lands taken over by the United States Government under the Philippine Property Act of 1946 enacted by the American Congress. It was registered in the Register of Deeds of Zamboanga in the name of Kantiro Koyama, a Japanese national, who has not been heard from since the end of World War II.  Under the said Act, the land was supposed to be transferred to the Republic of the Philippines.

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However, transfer was never made, and the property remained registered in the name of Koyama. Nevertheless, the lot has since 1978 been covered by Tax Declaration No. 42644 in the name of the Republic of the Philippines with the Board of Liquidators as administrator.

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Earlier, the Republic of the Philippines had filed escheat proceedings against the said property, claiming that the registered owner of the land "had been absent for the past ten years or more and he, therefore, may be presumed dead for the purpose of appointing his successor." It also alleged that since he left no heirs or persons entitled to the aforementioned property, the State should inherit the same in accordance with Rule 91 of the Rules of Court.

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After the required publications, hearing was held at which the City of Zamboanga did not appear and no claim or opposition was filed by any party. The Solicitor General allowed the appearance of the Board of Liquidators as administrator of the disputed land and the City Fiscal of Zamboanga City did not object. 4 Finally, the trial court declared the property —

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". . . escheated to the State in favor of the City of Zamboanga where the property is located for the benefit of public schools and public charitable institutions and centers in the City of Zamboanga."

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Not satisfied with the decision, the petitioner elevated the same to the Intermediate Appellate Court, where it was affirmed. The respondent court held that the City of Zamboanga — which had later intervened with leave of court — was entitled to the property in question.

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"The court, at the instance of an interested party, or on its own motion, may order the establishment of a permanent trust, so that only the income from the property shall be used."

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In so ruling, the respondent court rejected the position taken by the petitioner which it asks us now to consider as its justification for the reversal of the appealed decision. That position, simply stated, is that there was a mere oversight on the part of the American government which prevented the formality of a transfer of the property to the Philippine government. That neglect should not divest the Republic of the property which under the spirit and intendment of the Philippine Property Act of 1946 should belong to it as successor-in-interest of the United States.

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Oversight or not, says the respondent court, the fact is that the property was not transferred as required by the said law. Hence, it was properly escheated to the City of Zamboanga, on the unrebutted presumption that the registered owner was already dead, and there being no heirs or other claimants to the land in question.

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Issue:

Whether or not escheat proceedings cover properties taken from enemy nationals.

 

Held:

No. The Supreme Court speaking “We hold that where it comes to ordinary real properties the owners of which may be presumed dead and left no heirs, the same may be escheated, conformably to Rule 91 of the Rules of Court, in favor of the political subdivisions in which they are located. The said Rule, however, does not cover properties taken from enemy nationals as a result of World War II and required to be transferred to the Republic of the Philippines by the United States in accordance with its own enactment commonly known as the Philippine Property Act of 1946. Such properties, including the land in dispute, belong to the Philippine government not by virtue of the escheat proceedings but on the strength of the transfer authorized and required by the said Act.”