By authority of the United States, be it enacted by the Philippine Commission, that:
Section 1. Section thirty eight of Act Numbered Four Hundred and Ninety-six of the Philippine Commission entitled the Land Registration Act, is hereby amended to read as follows:
“Sec. 38. If the court after hearing finds that the applicant or adverse claimant has title as stated in his application or adverse claim and proper for registration, a decree of confirmation and registration shall be entered. Every decree of registration shall bind the land, and quiet title thereto, subject to the exceptions stated in the following section. It shall be conclusive upon and against all persons including the Insular Government and all the branches thereof, whether mentioned by name in the application, notice or citation, or included in the general description ‘To all whom it may concern.’ Such decree shall not be opened by reason of absence, infancy, or other disability of any person affected thereby, not by any proceeding in any court for reversing judgments or decrees: subject, however, to the right of any person deprived of land or of any estate or interest therein by decree of registration obtained by fraud to file in the competent Court of First Instance a petition for review within one year after entry of the decision- provided no innocent purchaser for value has acquired interest. Upon the expiration of said term of one year, every decree or certificate of title issued in accordance with this section shall be incontrovertible. If there is any such purchaser, the degree of registration shall not be opened, but shall remain in full force and effect forever, subject only to the right of appeal hereinbefore provided: Provided, however, That no decree or certificate of title issued to persons not parties to the appeal shall be cancelled or annulled. But any person aggrieved by such decree in any case may pursue his remedy by action for damages against the applicant or any or any other person for fraud in procuring the decree. Whenever the phrase ‘innocent purchaser for value’ or an equivalent phrase occurs in this Act, it shall be deemed to include an innocent lessee, mortgagee, or other encumbrance of value.”
Section 2. This Act shall take effect on its approval.