"X X X.
The law expressly provides that open spaces in subdivisions are reserved for public use and are beyond the commerce of man.[37] As such, these open spaces are not susceptible of private ownership and appropriation. We therefore rule that the sale of the subject parcel of land by the subdivision owner or developer to petitioner’s late husband was contrary to law. Hence, we find no reversible error in the appellate court’s Decision upholding the HLURB Arbiter’s annulment of the Deed of Sale.
Petitioner attempts to argue in favor of the validity of the sale of the subject parcel of land by invoking the principle of indefeasibility of title and by arguing that this action constitutes a collateral attack against her title, an act proscribed by the Property Registration Decree.
Petitioner is mistaken on both counts.
First, the rule that a collateral attack against a Torrens title is prohibited by law[38] finds no application to this case.
There is an attack on the title when the object of an action is to nullify a Torrens title, thus challenging the judgment or proceeding pursuant to which the title was decreed.[39] In the present case, this action is not an attack against the validity of the Torrens title, because it does not question the judgment or proceeding that led to the issuance of the title. Rather, this action questions the validity of the transfer of land from Marcelo to petitioner’s husband. As there is no attack – direct or collateral – against the title, petitioner’s argument holds no water.
Second, the principle of indefeasibility of title is not absolute, and there are well-defined exceptions to this rule.[40] In Aqualab Philippines, Inc. v. Heirs of Pagobo,[41] we ruled that this defense does not extend to a transferee who takes the title with knowledge of a defect in that of the transferee’s predecessor-in-interest.
In this case, Spouses Liwag were aware of the existence of the easement of water facility when Marcelo sold Lot 11, Block 5 to them. Hermogenes even executed an Affidavit dated 10 August 1982 attesting to the sufficiency of the water supply coming from an electrically operated water pump in the Subdivision.[42] It is undisputed that the water facility in question was their only water source during that time. As residents of the Subdivision, they had even benefited for almost 30 years from its existence. Therefore, petitioner cannot be shielded by the principle of indefeasibility and conclusiveness of title, as she was not an innocent purchaser in good faith and for value.
From the discussion above, we therefore conclude that the appellate court committed no reversible error in the assailed Decision and accordingly affirm it in toto.
x x x."
