SALAO V. SALAO, G.R.

NO L-26699 (1976)
FACTS: The spouses Manuel Salao and Valentina Ignacio of Barrio Dampalit, Malabon, Rizal
begot four children named Patricio, Alejandra, Juan (Banli) and Ambrosia. Manuel Salao died in
1885. His eldest son, Patricio, died in 1886 survived by his only child, Valentin Salao.
1. After Valentinas death, her estate was administered by her daughter Ambrosia.
2. The documentary evidence proves that in 1911 or prior to the death of Valentina Ignacio
her two children, Juan Y. Salao, Sr. and Ambrosia Salao, secured a Torrens title, OCT No.
185 of the Registry of Deeds of Pampanga, in their names
3. The property in question is the forty-seven-hectare fishpond located at Sitio Calunuran,
Lubao, Pampanga, wherein Benita Salao-Marcelo daughter of Valentin Salao claimed
1/3 interest on the said fishpond.
4. The defendant Juan Y. Salao Jr. inherited from his father Juan Y. Salao, Sr. of the
fishpond and the other half from the donation of his auntie Ambrosia Salao.
5. It Plaintiffs (Benita Salao) alleged that Juan Y. Salao, Sr and Ambrosia Salao had
engaged in the fishpond business. Where they obtained the capital and that Valentin
Salao and Alejandra Salao were included in that joint venture, that the funds used were
the earnings of the properties supposedly inherited from Manuel Salao, and that those
earnings were used in the acquisition of the Calunuran fishpond. There is no
documentary evidence to support that theory.
6. The lawyer of Benita Salao and the Children of Victorina Salao in a letter dated January
26, 1951 informed Juan S. Salao, Jr. that his clients had a one-third share in the two
fishponds and that when Juani took possession thereof in 1945, in which he refused to
give Benita and Victorinas children their one-third share of the net fruits which allegedly
amounted to P200,000. However, there was no mention on the deeds as to the share of
Valentin and Alejandra.
7. Juan S. Salao, Jr. (respondent) in his answer dated February 6, 1951 categorically stated
that Valentin Salao did not have any interest in the two fishponds and that the sole
owners thereof his father Banli and his aunt Ambrosia, as shown in the Torrens titles issued
in 1911 and 1917, and that he Juan was the donee of Ambrosias one-half share.
8. Benita Salao and her nephews and niece asked for the annulment of the donation to
Juan S. Salao, Jr. and for the reconveyance to them of the Calunuran fishpond as
Valentin Salaos supposed one-third share in the 145 hectares of fishpond registered in
the names of Juan Y. Salao, Sr. and Ambrosia Salao.

ISSUE: WON the Calunuran fishpond was held in trust for Valentin Salao by Juan Y. Salao, Sr. and
Ambrosia Salao

HELD: There was no resulting trust in this case because there never was any intention on the part
of Juan Y. Salao, Sr., Ambrosia Salao and Valentin Salao to create any trust. There was no
constructive trust because the registration of the two fishponds in the names of Juan and
Ambrosia was not vitiated by fraud or mistake. This is not a case where to satisfy the demands of
justice it is necessary to consider the Calunuran fishpond being held in trust by the heirs of Juan
Y. Salao, Sr. for the heirs of Valentin Salao.

A Torrens Title is generally a conclusive evidence of the ownership of the land referred to therein.
(Sec. 47, Act 496). A strong presumption exists that Torrens titles were regularly issued and that
they are valid. In order to maintain an action for reconveyance, proof as to the fiduciary relation
of the parties must be clear and convincing.

The plaintiffs utterly failed to prove by clear, satisfactory and convincing evidence. It cannot rest
on vague and uncertain evidence or on loose, equivocal or indefinite declarations.
Trust and trustee; establishment of trust by parol evidence; certainty of proof. Where a trust is
to be established by oral proof, the testimony supporting it must be sufficiently strong to prove
the right of the alleged beneficiary with as much certainty as if a document proving the trust
were shown. A trust cannot be established, contrary to the recitals of a Torrens title, upon vague
and inconclusive proof.

Trusts; evidence needed to establish trust on parol testimony. In order to establish a trust in real
property by parol evidence, the proof should be as fully convincing as if the act giving rise to the
trust obligation were proven by an authentic document. Such a trust cannot be established
upon testimony consisting in large part of insecure surmises based on ancient hearsay. (Syllabus,
Santa Juana vs. Del Rosario 50 Phil. 110).

The foregoing rulings are good under article 1457 of the Civil Code which, as already noted,
allows an implied trust to be proven by oral evidence. Trustworthy oral evidence is required to
prove an implied trust because, oral evidence can be easily fabricated.

On the other hand, a Torrens title is generally a conclusive of the ownership of the land referred
to therein (Sec. 47, Act 496). A strong presumption exists. that Torrens titles were regularly issued
and that they are valid. In order to maintain an action for reconveyance, proof as to the
fiduciary relation of the parties must be clear and convincing.

The real purpose of the Torrens system is, to quiet title to land. Once a title is registered, the
owner may rest secure, without the necessity of waiting in the portals of the court, or sitting in the
mirador de su casa, to avoid the possibility of losing his land.

ISSUE: plaintiffs action for reconveyance had already prescribed

HELD: Reconveyance had already prescribed. Plaintiffs action is clearly barred by prescription
or laches.

Under Act No. 190, whose statute of limitation would apply if there were an implied trust in this
case, the longest period of extinctive prescription was only ten year.
The Calunuran fishpond was registered in 1911. The written extrajudicial demand for its
reconveyance was made by the plaintiffs in 1951. Their action was filed in 1952 or after the lapse
of more than forty years from the date of registration. The plaintiffs and their predecessor-in-
interest, Valentin Salao, slept on their rights if they had any rights at all. Vigilanti prospiciunt jura
or the law protects him who is watchful of his rights (92 C.J.S. 1011, citing Esguerra vs. Tecson, 21
Phil. 518, 521).

Undue delay in the enforcement of a right is strongly persuasive of a lack of merit in the claim,
since it is human nature for a person to assert his rights most strongly when they are threatened
or invaded. Laches or unreasonable delay on the part of a plaintiff in seeking to enforce a
right is not only persuasive of a want of merit but may, according to the circumstances, be
destructive of the right itself.

Having reached the conclusion that the plaintiffs are not entitled to the reconveyance of the
Calunuran fishpond, it is no longer to Pass upon the validity of the donation made by Ambrosia
Salao to Juan S. Salao, Jr. of her one-half share in the two fishponds The plaintiffs have no right
and personality to assil that donation.

Even if the donation were declared void, the plaintiffs would not have any successional rights to
Ambrosias share. The sole legal heir of Ambrosia was her nephew, Juan, Jr., her nearest relative
within the third degree. Valentin Salao, if living in 1945 when Ambrosia died, would have been
also her legal heir, together with his first cousin, Juan, Jr. (Juani). Benita Salao, the daughter of
Valentin, could not represent him in the succession to the estate of Ambrosia since in the
collateral line, representation takes place only in favor of the children of brothers or sisters
whether they be of the full or half blood is (Art 972, Civil Code). The nephew excludes a
grandniece like Benita Salao or great-gandnephews like the plaintiffs Alcuriza (Pavia vs. Iturralde
5 Phil. 176).















































FABIAN vs. FABIAN, G.R. NO L-20449 (1968)
FACTS: Pablo Fabian bought from the Philippine Government lot 164 of the Friar Lands Estate in
Muntinlupa, Rizal. By virtue of this purchase, he was issued sale certificate 547. He died on August
2, 1928, survived by four children, namely, Esperanza, Benita I, Benita II,

and Silbina.
1. On October 5, 1928 Silbina Fabian and Teodora Fabian, niece of the deceased,
executed an affidavit. On the strength of this affidavit, sale certificate 547 was assigned
to them.
2. The acting Director of Lands, on behalf of the Government, sold lot 164 to Silbina Fabian
and Teodora Fabian. The vendees spouses forthwith took physical possession thereof,
cultivated it, and appropriated the produce. In that same year, they declared the lot in
their names for taxation purposes. In 1937 the RD of Rizal issued a TCT over lot 164 in their
names. They later subdivided the lot into 2 equal parts.
3. The plaintiffs filed the present action for reconveyance against the defendants spouses,
averring that Silbina and Teodora, through fraud perpetrated in their affidavit aforesaid.
That by virtue of this affidavit, the said defendants succeeded in having the sale
certificate assigned to them and thereafter in having lot 164 covered by said certificate
transferred in their names; and that by virtue also of these assignment and transfer, the
defendants succeeded fraudulently in having lot 164 registered in their names. They
further allege that the land has not been transferred to an innocent purchaser for value.
A reconveyance thereof is prayed for.
4. In their answer, the defendants spouses claim that Pablo Fabian was not the owner of lot
164 at the time of his death on August 2, 1928 because he had not paid in full the
amortizations on the lot; that they are the absolute owners thereof, having purchased it
from the Government, and from that year having exercised all the attributes of
ownership thereof up to the present; and that the present action for reconveyance has
already prescribed. The dismissal of the complaint is prayed for.
5. The lower court rendered judgment declaring that the defendants spouses had acquired
a valid and complete title to the property by acquisitive prescription, and accordingly
dismissed the complaint. The latters motion for reconsideration was thereafter denied.

ISSUE: Was Pablo Fabian the owner of lot 164 at the time of his death, in the face of the fact,
admitted by the defendants-appellees, that he had not then paid the entire purchase price
thereof?

HELD: Yes. Lot 164 was a part of the Friar Lands Estate of Muntinlupa, Rizal; its sale to Pablo
Fabian was therefore governed by Act 1120, otherwise known as the Friar Lands Act. While
under section 15 of the said Act, title to the land sold is reserved to the Government until the
purchaser makes full payment of all the required installments and the interest thereon, this legal
reservation refers to the bare, naked title. The equitable and beneficial title really went to the
purchaser the moment he paid the first installment and was given a certificate of sale. The
reservation of the title in favor of the Government is made merely to protect the interest of the
Government so as to preclude or prevent the purchaser from encumbering or disposing of the
lot purchased before the payment in full of the purchase price. Outside of this protection the
Government retains no right as an owner. For instance, after issuance of the sales certificate and
pending payment in full of the purchase price, the Government may not sell the lot to another. It
may not even encumber it. It may not occupy the land to use or cultivate; neither may it lease it
or even participate or share in its fruits. In other words, the Government does not and cannot
exercise the rights and prerogatives of owner. And when said purchaser finally pays the final
installment on the purchase price and is given a deed of conveyance and a certificate of title,
the title at least in equity, retroacts to the time he first occupied the land, paid the first
installment and was issued the corresponding certificate of sale. In other words, pending the
completion of the payment of the purchase price, the purchaser is entitled to all the benefits and
advantages which may accrue to the land as well as suffer the losses that may befall it.


That Pablo Fabian had paid five annual installments to the Government, and in fact been issued
a sale certificate in his name, are conceded. He was therefore the owner of lot 164 at the time
of his death. He left four daughters, namely, Esperanza, Benita I, Benita II and Silbina to whom all
his rights and interest over lot 164 passed upon his demise.

In case a holder of a certificate dies before the giving of the deed and does not leave a widow,
then the interest of the holder of the certificate shall descend and deed shall issue to the person
who under the laws of the Philippine Islands would have taken had the title been perfected
before the death of the holder of the certificate, upon proof of the holders thus entitled of
compliance with all the requirements of the certificate.



ISSUE: May laches constitute a bar to an action to enforce a constructive trust?

HELD: The assignment and sale of the lot to the defendants Silbina and Teodora were therefore
null and void. To the extent of the participation of the appellants, application must be made of
the principle that if property is acquired through fraud, the person obtaining it is considered a
trustee of an implied trust for the benefit of the person from whom the property comes.

Laches may bar an action brought to enforce a constructive trust such as the one in the case at
bar. Illuminating are the following excerpts from a decision penned by Mr. Justice Reyes:

But in constructive trusts, the rule is that laches constitutes a bar to actions to enforce the trust,
and repudiation is not required, unless there is a concealment of the facts giving rise to the trust.

The assignment of sale certificate was effected in October 1928; and the actual transfer of lot
164 was made on the following November 14. It was only on July 8, 1960, 32 big years later, that
the appellants for the first time came forward with their claim to the land. The record does not
reveal, and it is not seriously asserted, that the appellees concealed the facts giving rise to the
trust. Upon the contrary, paragraph 13 of the stipulation of facts of the parties states with striking
clarity that defendants herein have been in possession of the land in question since 1928 up to
the present publicly and continuously under claim of ownership; they have cultivated it,
harvested and appropriated the fruits for themselves.

ISSUE: Has title to the land vested in the appellees through the mode of acquisitive prescription?

HELD: It is already settled in this jurisdiction that an action for reconveyance of real property
based upon a constructive or implied trusts, resulting from fraud, may be barred by the statute
of limitations. the discovery in that case being deemed to have taken place when new
certificates of title were issued exclusively in the names of the respondents therein.

Although, as a general rule, an action for partition among co-heirs does not prescribe, this is true
only as long as the defendants do not hold the property in question under an adverse title. The
statute of limitations operates, as in other cases, from the moment such adverse title is asserted
by the possessor of the property

Inasmuch as petitioners seek to annul the aforementioned deed of extra-judicial settlement
upon the ground of fraud in the execution thereof, the action therefor may be filed within four
(4) years from the discovery of the fraud. Upon the undisputed facts in the case at bar, not only
had laches set in when the appellants instituted their action for, reconveyance in 1960, but as
well their right to enforce the constructive trust had already prescribed.

It logically follows from the above disquisition that acquisitive prescription has likewise operated
to vest absolute title in the appellees, pursuant to the provisions of section 41 of Act 190 that:

Ten years actual adverse possession by any person claiming to be the owner for that time of any
land or interest in land, uninterruptedly continued for ten years by occupancy, descent, grants,
or otherwise, in whatever way such occupancy may have commenced or continued,

shall vest
in every actual occupant or possessor of such land a full and complete title

Upon the foregoing disquisition, we hold not only that the appellants action to enforce the
constructive trust created in their favor has prescribed, but as well that a valid, full and complete
title has vested in the appellees by acquisitive prescription.

NOTES:
1. Art 1456 NCC, while not retroactive in character, merely expresses a rule already recognized
by our courts prior to the Codes promulgation (see Gayondato vs. Insular Treasurer, 49 Phil. 244).
Appellants are, however, in error in believing that like express trust, such constructive trusts may
not be barred by lapse of time. The American law on trusts has always maintained a distinction
between express trusts created by the intention of the parties, and the implied or constructive
trusts that are exclusively created by law, the latter not being trusts in their technical sense. The
express trusts disable the trustee from acquiring for his own benefit the property committed to his
management or custody, at least while he does not openly repudiate the trust, and makes such
repudiation known to the beneficiary or cestui que trust. For this reason, the old Code of Civil
Procedure (Act 190) declared that the rules on adverse possession does not apply to
continuing and subsisting (i.e., unrepudiated) trusts.



























BUENO V. REYES, G.R. NO L-22587 (1969)
FACTS: On January 7, 1936 Francisco H. Reyes filed an answer in Cadastral Case No. 47 of Ilocos
Norte, claiming lot No. 2857 of the Laoag Cadastre as property belonging to himself and to his
two brothers, Juan and Mateo.
1. The case was heard without opposition, and the lot was adjudicated in favor of the
claimants on March 27, 1939, in whose names Original Certificate of Title No. 19074 was
issued on the following July 7.
2. Twenty-three years thereafter, or on December 12, 1962 to be exact, the plaintiffs filed
the action below for reconveyance of lot No. 2357. They allege in their complaint that
the said lot originally belonged to Jorge Bueno, who died leaving three children, namely,
Brigida Bueno, Eugenia Bueno and Rufino Bueno, to whom the property descended by
intestate succession; that subsequently Brigida and Eugenia died, leaving their
respective children, who are now the plaintiffs-appellants together with Rufino Bueno;
that Francisco H. Reyes was Eugenias husband and the father of the plaintiffs surnamed
Reyes, who agreement among the heirs of Jorge Bueno was entrusted in filing the
answer in the cadastral proceedings and in obtaining the title thereto for and in behalf
of all the heirs of Jorge Bueno, including his wife Eugenia Bueno.

ISSUE: WON by mistake or fraud, the real owner being another person, impresses upon the title so
acquired the character of a constructive trust for the real owner, which would justify an action
for reconveyance

HELD: Under Art 1456 NCC, if property is acquired through mistake or fraud, the person
obtaining it is, by force of law, considered a trustee of an implied trust for the benefit of the
person from whom the property comes. An action upon a trust is imprescriptible, without
distinguishing between express and implied trusts, the better rule, as laid down by this Court in
other decisions, is that prescription does supervene where the trust is merely an implied one. The
constructive trust arose by reason of the bad faith or mistake of the deceased Francisco H.
Reyes, compounded by the connivance of the appellees Juan and Mateo Reyes.























TAMAYO V. CALLEJO, G.R. NO L-25563 (1972)
FACTS: Before 19112, the Tamayos sold a piece of land to Fernando Domantay, who took
possession of the land.
1. When Vicente died after the sale and his widow waived her rights to the remaining
portion of the property to their children Mariano and Marcos, the two brothers applied to
register the land in their name, saying they inherited it from their father, includi ng the part
that was sold to Domantay.
2. In 1918 Domantay sold the land to Callejo.
3. In 1940 Mariano Tamayo sold the land to Estacio, whose surveyor went to the land in
1952 to segregate it; that same year Callejo registered his adverse claim to the land.
4. Tamayo pleaded the statute of limitations as defense, but the court found that in 1918,
when they had the land registered in their name, Mariano Tamayo, on his behalf and
that of his brother, executed a public document acknowledging that his deceased
parents had sold a parcel of the land to Domantay.

HELD: Though there was no clear evidence to create a trust, ruling out an express trust, the
admission of the sale in a public document turned the implied trust into an express one. An
express trust, the court held, was a continuing and subsisting trust until repudiated, in which
case the period of prescription begins to run only from the time of repudiation.