Special civil action for certiorari and mandamus  to nullify the Order of respondent Judge dated August 5, 1975, rejecting the admission of petitioner's supplemental answer in Civil Case No. 7406,^[1] and to command said respondent to admit the afore-mentioned pleading. 

On March 14, 1972, the spouses Francisco Blances and Valeriana B. Blances (private respondents) filed with the Court of First Instance of Davao City an action to recover possession of Lot No. 160, situated at Guianga District, Davao City, containing about five (5) hectares more or less, and to secure a declaration of nullity of the transmission of rights and sale of improvements over said property (Annex "A"), as well as the supplementary agreements executed by the afore-mentioned spouses in favor of Jesusa R. Quiaoit (petitioner) on May 18, 1966 in consideration of the sum of 16,800.00 on the ground that since the property was acquired under Republic Act No. 477, its sale is expressly prohibited by said Act. The action for annulment is predicated upon their claim that it could not have been their intention to transfer or sell their rights over the afore-cited property, but to use said property as security for the loan of P6,800.00. 

On May 2, 1972, defendant (petitioner herein) filed her answer alleging, among others, the following: 

"3.  That defendant specifically denies the allegation in paragraph 5 that plaintiffs are 'bonafide claimants, occupants, and possessors and vendees of the land in ques­tion,' the truth of the matter being that, despite the con­dition expressed in the Deed of Sale of said land executed by the National Abaca and Other Fibers Corporation (NAFCO) in their favor 'not to sell and/or encumber said property within a period of ten (10) years from the date of issuance of the Certificate of Title', contrary to said condition, plaintiffs mortgaged in 1966, or within the prohibitive pe­riod, the same lot to the Rural Bank of Davao City, so plaintiffs had to sell the land to herein defendant to avoid the foreclosure of said mortgage;

"4.  That the allegations in paragraph 6, that the deed of sale of the land in question is null and void is specifically denied for being a wrong conclusion of law, and that if the plaintiffs desire to repurchase or reac­quire the property, it is because the same has already been developed and improved by herein defendant, so much that its value has considerably increased;" (Annex "B", Petition) 

During the pendency of the case, or on April 1, 1975, the Board of Liquidators promulgated its resolution, dated March 25, 1975, cancelling the award of the afore-mentioned Lot No. 160 to respondent Francisco Blances for violation of the provisions of Republic Act No. 477 and declaring the payments made therein forfeited in favor of the Board and ordering that said land be disposed of in accordance with the provisions of Republic Act No. 477. 

On the basis of the cancellation of the award, peti­tioner filed with the lower court a motion to dismiss the complaint on the grounds that (1) the claim or demand set forth in the complaint has been extinguished; and (2) plain­tiffs have no more cause of action against the defendant. Respondent Judge denied the motion for lack of merit. After the denial of her motion to dismiss, petitioner filed a mo­tion to admit supplemental answer, alleging that the cancellation of private respondents' award was not taken up in her answer because it was handed down only on April 1, 1975. There having been no opposition to said motion, the same was granted and the supplemental answer admitted. On motion for reconsideration of private respondents, however, said Order admitting the supplemental answer was set aside by the trial court on August 5, 1975. Petitioner moved for reconsideration, but the same was denied by the respondent Judge in an Order dated September 15, 1975, stating as fol­lows: 

"* * *                                      * * *                                          * * * 

"It is enough to state that the cancellation of the award on April 1, 1975 does not in any wise have any bear­ing in so far as between the parties herein. 

"The cancellation of the award, for a disregard or violation of the condition does not produce an automatic reversion of the property to the State, nor work to defeat the grantee's right to recover the property. 

'Clearly, until and unless an appropriate proceeding for reversion is instituted by the State, and its reacquisition of the ownership and possession of the land decreed by a compe­tent court, the grantee can not be said to have been divested of whatever right that he may have over the same property.' (Ras v. Sua, No. L­23302, Sept. 25, 1968.) 

"This is a question between the State and the Awardee, the Plaintiff herein. 

"Further, even granting that there is a cancellation of the award or even a reversion to the State is decreed, the Defendant does not acquire any right over such property, since the land cancelled or reverted is declared vacant, and subject to raffling in accordance with Section 3 of Republic Act No. 477. 

* * *                                       * * *                                          * * *" 

Contending that she has no other plain, speedy and adequate remedy in the ordinary course of law, and that the aforesaid Orders of the lower court were issued in a capri­cious and whimsical manner and in grave abuse of discre­tion, petitioner filed the present petition. 

The issue then is whether or not the trial court erred in rejecting the admission of the supplemental answer and in declaring that the cancellation of the award has no bear­ing in the case, much less affect private respondents' right to recover the property. 

I 

To begin with, it may be relevant to note that the ground of dismissal herein invoked by petitioner ? that the complaint states no cause of action ? may be alleged in a later pleading or even at the trial, in which case, the motion is to be resolved in the light of the evidence which may be submitted. The rule is explicit that the def­ense of "failure to state a cause of action" is not covered by the rule that defenses and objections not pleaded in the motion to dismiss or in the answer are deemed waived. This defense of lack of cause of action may be alleged in a motion to dismiss after the answer has been filed, or by a motion for judgment on the pleadings, or at the trial on the merits.^[2]  Thus, it has been held that a motion to dismiss for failure to state a claim is so basic that it may even be raised on the trial.^[3] 

A motion to dismiss may also be allowed for some special reason even after the trial of the case has already begun. Thus, this Court has allowed the filing of a motion to dismiss, even after defendant's answer and after hearing has been commenced, upon grounds other than plaintiff's failure to state a cause of action or court's failure to acquire jurisdiction over the subject matter of the action, i.e., where evidence that would constitute a ground for the dismissal of the complaint was discovered during trial. This Court explained that the motion serves to supplement the averments of defendant's answer and to adjust the issues to the testimony of plaintiff himself.^[4] 

Now, on the main issue, it appears that the initial reason for the trial court in rejecting the admission of the supplemental answer is that said court had already passed upon the defenses contained in the supplemental ans­wer when it resolved petitioner's motion to dismiss. 

As to whether or not the court a quo committed a re­versible error, it is necessary to advert to certain settled procedural rules and principles. 

It is a well-established rule of practice and proce­dure that an order denying a motion to dismiss and its subsequent motion for reconsideration is interlocutory in nature. Such order does not terminate the proceedings much less does it finally dispose of the contentions of the parties.^[5] It cannot, therefore, be appealed until after the rendition of the judgment on the merits.^[6] In Moreno,^[7]  it was emphasized that unless the order of denial "consti­tuted clearly a grave abuse of discretion or was issued without or in excess of jurisdiction, the error, if any, should be corrected by appeal in due time, after trial and judgment on the merits, and not by the extraordinary writ of prohibition". The obvious remedy of the movants whose motion to dismiss has been denied is, in the words of Harrison Foundry & Machinery v. Harrison Foundry Workers Association,^[8]  "to interpose, as defenses in their answer, the objections raised by them in the motion to dismiss, then proceed to trial, and, in case of an unfavorable decision, bring the case * * * on appeal in due time, so that the Appellate Court 'may rule on all the issues once and for all.'"^[9]  In other words, since an order denying a motion to dismiss is interlocutory, the remedy of a defendant is to interpose, as defenses in his answer, the objections raised by him in the motion to dismiss, then proceed to trial, and in case of adverse decision, reiterate the issue on appeal. 

The denial of a motion to dismiss the complaint for failure to state a cause of action does not operate to res­trict in any manner the subsequent pleadings of the par­ties.^[10]  In a case where at the outset of the trial the defendant moved to dismiss the complaint on the ground that plaintiff's statement failed to disclose a cause of action, and such motion was denied, the defendant was not precluded from incorporating the same objection in his answer.^[11] 

In the case at bar, petitioner's action in interposing the aforesaid defense in his supplemental answer was, there­fore, in accord with the foregoing rules. In rejecting petitioner's supplemental answer, the respondent Judge, therefore, committed a reversible error. 

II 

Respondent Court's reliance in the rule enunciated in Ras v. Sua,^[12]  appears inapposite. Here, it is undisputed that in connection with Lot No. 160, no sales patent or certificate of title has ever been issued to respondent Francisco Blances. Neither has it been shown that Blances has paid in full the consideration agreed upon in the deed of sale, much less is it asserted that he has complied with all the requisites for the issuance of a sales patent in accordance with the provisions of the Public Land Law, as amended. There is also no question that the Board of Liqui­dators, as successor of the National Abaca and Other Fibers Corporation (NAFCO), has the power and authority under the provisions of Republic Act No. 477 to cancel or give due course to a sales contract or application regarding lands under its administration. Thus, it was explained in Alvarez v. Board of Liquidators,^[13]  that the agreement denominated "Contract of Sale" with respect to public agricultu­ral lands awarded to applicants under Republic Act No. 477 "is not really a deed of actual sale, but should be considered as a mere application". It was stated therein that after the approval of such application and the awardee pays in full the consideration agreed upon in the deed of sale, it will be still necessary for the Board to determine whe­ther or not the awardee has complied with the provisions of Republic Act No. 477 and the pertinent provisions of the Public Land Law, relative to the requisites for the issuance of a sales patent. It was held therein that if the Board finds the applicant not qualified because he did not actually occupy the land but merely served as a dummy, or has violated the law, then it can cancel the contract. 

In the case at bar, it is conceded that the private respondents have executed conveyances in violation of sec­tion 8 of Republic Act No. 477 and that the award to res­pondent Francisco Blances has been cancelled by the Board of Liquidators before the issuance of the corresponding sales patent. As it is settled that the Board of Liquida­tors had the full power and authority to cancel the award, as the so-called "contract of sale" "is not really a deed of actual sale, but should be considered as a mere applica­tion",^[14]  the cancellation of the application would, there­fore, preclude private respondents from asserting any pro­prietary or possessory rights over the said public land. Indeed, the right of an applicant to public land does not become absolute until after he has complied with all the requirements of law.^[15] Consequently, private respondents could not insist on a formal action for reversion under section 101 of the Public Land Law. As ruled by this Court in Francisco v. Rodriguez,^[16]  the afore-cited section "may be invoked only when title has already vested in the indi­vidual, e.g. when a patent or a certificate of title has already been issued". 

Unlike in Ras v. Sua, supra, the issue is, therefore, not the automatic reversion of the property to the State. Rather whether, in view of the cancellation of the award to private respondents by the Board of Liquidators for viola­tion of the provisions of Republic Act No. 477, the action instituted by said parties had already become moot. 

WHEREFORE, in view of the foregoing, the writ prayed for is granted and the Orders of respondent Judge, dated August 5, 1975 and September 15, 1975, are hereby set aside. Costs against private respondents. 

Aquino and Concepcion, Jr., JJ., concur. 

Fernando, J., (Chairman), concurs in both opinions. 

Barredo, J., concurs in a separate opinion. 

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^[1] Entitled "Valeriana B. Blances and Francisco Blames, Plaintiffs, versus Jesusa R. Quiaoit, Defendant."  

^[2] Section 9, Rule 9, Revised Rules of Court; Azur v. Provincial Board, 27 SCRA 50; De Jesus v. Manglapus, 81 Phil. 114; Community Investment, etc. v. Garcia, 88 Phil. 215, 220-222. 

^[3] Ginsburg v. Standard Oil Co. of New Jersey, 9 Fed, Rules Service 398. 

^[4] Bugayong v. Ginez, 100 Phil. 616. 

^[5] Yu Zoat v. Hugo, 93 Phil. 613; Hodges v, Villanueva, 90 Phil. 255. 

^[6] Sy v. Dalman, 22 SCRA 834; Ramos v. Ardant Trading Corporation, 23 SCRA 974. 

^[7] Moreno v. Macadaeg, 7 SCRA 700, 704. 

^[8] 8 SCRA 434. 

^[9] Cf. Sy v. Dalman, supra, citing Harrison Foundry and Machinery, sup­ra, Bautista v. De la Cruz, L-21107, Dec. 24, 1963; Arches v. Belosillo, L-23534, May 16, 1967. 

^[10] Young v. Aetna Life Ins. Co., 2 Fed. Rules Service 84. 

^[11] "* * * While a motion to dismis admits, for the purposes of the consideration thereof, the truth of all facts well pleaded in the complaint, such admission does not preclude the movant, in the event the motion is denied, from filing an answer denying every material allegation of the complaint. Smetal Corpo­ration v. Family Loan Co., 1935, 119 Fla 497, 161 So 438; Olin's, Inc. v. Avis Rental Car System of Florida, Fla 1958, 104 So 2d 508. The presumption of truthfulness attending con­sideration of the sufficiency of a complaint to state a cause of action does not operate to relieve the plaintiff of the burden of proof resting upon him. A fortiori, denial of a mo­tion to dismiss the complaint for failure to state a cause of action does not operate to restrict in any manner the subse­quent pleadings of the parties. The subject presumption is indulgedas an aid to orderly pleading, for the limited purp­ose of passing upon the sufficiency in law of the pleading attacked, and is not binding upon the court in the considera­tion of the case on final hearing. It is not to be regarded as an acknowledgment or used as evidence, or considered as equivalent to evidence. Bennett v. Senn, 1932, 106 Fla 446, 144 So 840." (Lehew v. Larsen, Fla. App., 124 So. 2d 872, 85 ALR 2d 821, 823.) 

^[12] 25 SCRA 153. 

^[13] 4 SCRA 195. 

^[14] Alvarez v. Board of Liquidators, supra. 

^[15] Cf. Juanico v. American Land Commercial, 97 Phil. 221; Ocampo v. Delizo, L-32820-21, January 30, 1976, 69 SCRA 216. 

^[16] 6 SCRA 442. 

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