PROPERTY CASES

prove respondents allegation of prior physical

possession.

MARCELA M. DELA CRUZ, Petitioner, v.

ANTONIO Q. HERMANO AND HIS WIFE
REMEDIOS HERMANO, Respondents.
G.R. No. 160914
March 25, 2015
FACTS: Respondents Antonio Hermano and his
wife Remedios Hermano were the registered and
lawful owners of a house and lot in Tagaytay City.
On September 1, 2001, petitioner Marcela M.
Dela Cruz occupied and possessed the
questioned property pursuant to the alleged
Memorandum of Agreement between her and a
certain Don Mario Enciso Benitez, without the
authority and consent of the Hermanos. On
September 27, 2001, A. Hermano, through a
counsel, sent a formal demand letter to Dela
Cruz to vacate and turn over the possession of
the property and to pay P 20,000 a month as
rent starting September 1, 2001.
Respondent filed an ejectment case against the
petitioner at the MTCC; however, the court
dismissed the case due to lack of jurisdiction.
The court also stated that respondents proper
remedy should be an action for recovery and not
of a summary proceeding for ejectment, because
there was no showing of forcible entry or
unlawful detainer.
Respondent appealed the decision at the RTC;
the said court, however, affirmed the decision of
the lower court en toto. The same filed a petition
for review at the CA, of which, granted the
petition, reversed and set aside the decision of
RTC. Furthermore, the court rendered a decision
declaring Hermano as the lawful possessor of the
property and order Dela Cruz to vacate the
same. With the CAs decision, petitioner filed a
petition for review at the Supreme Court.
ISSUE: Whether or not respondent has
adequately pleaded and proved a case of forcible
entry.
HELD: The burden of sufficiently alleging prior
physical
possession
carries with it the
concomitant burden of establishing ones case
by a preponderance of evidence. To be able to do
so, respondents herein must rely on the strength
of their own evidence, not on the weakness of
that of petitioner. It is not enough that the
allegations of a complaint make out a case for
forcible entry. The plaintiff must prove prior
physical possession. It is the basis of the security
accorded by law to a prior occupant of a property
until a person with a better right acquires
possession thereof.
The
Court
has
scrutinized
the
parties
submissions, but found no sufficient evidence to

To prove their claim of having a better right to

possession, respondents submitted their title
thereto and the latest Tax Declaration prior to
the initiation of the ejectment suit. As the CA
correctly observed, petitioner failed to controvert
these documents with competent evidence. It
erred, however, in considering those documents
sufficient to prove respondents prior physical
possession.
Ownership certainly carries the right of
possession, but the possession contemplated is
not exactly the same as that which is in issue in
a forcible entry case. Possession in a forcible
entry suit refers only to possession de facto, or
actual or material possession, and not one
flowing out of ownership. These are different
legal concepts under which the law provides
different remedies for recovery of possession.
Thus, in a forcible entry case, a party who can
prove prior possession can recover the
possession even against the owner. Whatever
may be the character of the possession, the
present occupant of the property has the
security to remain on that property if the
occupant has the advantage of precedence in
time and until a person with a better right
lawfully causes eviction.
Similarly, tax declarations and realty tax
payments are not conclusive proofs of
possession. They are merely good indicia of
possession in the concept of owner based on the
presumption that no one in ones right mind
would be paying taxes for a property that is not
in ones actual or constructive possession.
Guided by the foregoing, the Court finds that the
proofs
submitted
by
respondents
only
established possession flowing from ownership.
Although respondents have claimed from the
inception of the controversy up to now that they
are using the property as their vacation house,
that claim is not substantiated by any
corroborative evidence. On the other hand,
petitioners claim that she started occupying the
property in March 2001, and not in September of
that year as Antonio alleged in his Complaint,
was corroborated by the Affidavit of petitioners
caretaker. Respondents did not present any
evidence to controvert that affidavit.
Therefore, respondents failed to discharge their
burden of proving the element of prior physical
possession. Their uncorroborated claim of that
fact, even if made under oath, is self-serving. It
does not amount to preponderant evidence,
which simply means that which is of greater
weight or is more convincing than evidence that
is offered in opposition.
As noted at the outset, it bears stressing that the

PROPERTY CASES | Digested by Terence Valdehueza And Mia Unabia

Court is not a trier of facts. However, the

conflicting findings of fact of the MTCC and the
RTC, on the one hand, and the CA on the other,
compelled us to revisit the records of this case
for the proper dispensation of justice. Moreover,
it must be stressed that the Courts
pronouncements in this case are without
prejudice to the parties right to pursue the
appropriate remedy.
WHEREFORE, the Petition for Review on
Certiorari is hereby GRANTED. The assailed
Decision and Resolution of the Court of Appeals
are REVERSED, and the Decision of the MTCC
dismissing the Complaint against petitioner
is REINSTATED.

JOSEFINA V. NOBLEZA, Petitioner, v. SHIRLEY

B. NUEGA, Respondent.
G.R. No. 193038
March 11, 2015
FACTS: Respondent Shirley Nuega, an OFW
working as a domestic helper in Israel, was
married to Rogelio Nuega on September 1, 1990.
On 1988, prior to their marriage, Shirley financed
Rogelio in buying a house and lot in Marikina.
The same was purchased by Rogelio on
September 1989 and was registered on October
1989 under his sole name.
The couple then moved to their new home after
their marriage in September 1990. Then after,
Shirley returned to Israel. While at overseas, she
learned about extra-marital affairs of her
husband, and it was confirmed upon her return
that she was living and having an affair with a
certain Monica Escobar in the same property.
In June 1992, Shirley filed two cases against
Rogelio: one for Concubinage and another for
Legal Separation and Liquidation of Property.
Shirley withdraw the latter complaint but later
re-filed the same. In between the filing of the
cases, Shirley learned that Rogelio had the
intention of selling the subject property. Shirley
then advised the interested buyersone was their
neighbor and the other was the petitionerof the
existence of the cases that she had filed against
Rogelio and cautioned them against buying the
subject property until the cases are closed and
terminated. Nonetheless, under a Deed of
Absolute Sale dated December 29, 1992, Rogelio
sold the subject property to petitioner without
Shirley's consent for 380,000 pesos, including
petitioner's undertaking to assume the existing
mortgage on the property and to pay the real
property taxes due thereon.
On May 16, 1994, the RTC granted the petition
for legal separation and ordered the dissolution
and liquidation of the regime of absolute
community of property between Shirley and

Rogelio. Rogelio appealed the ruling before the

CA which denied due course and dismissed the
petition. It became final and executory and a writ
of execution was issued in August 1995.
On August 27, 1996, Shirley instituted a
Complaint for Rescission of Sale and Recovery of
Property against petitioner and Rogelio before
the RTC. After trial on the merits, the trial court
rendered the sale of Shirleys portion being null
and void; ordered Nobleza to reconvey or pay
Shirley with that of her share; and ordered the
same to pay for the latters attorneys fees.
Petitioner sought recourse with the CA, while
Rogelio did not appeal the ruling of the trial
court. In its assailed Decision promulgated on
May 14, 2010, the appellate court affirmed with
modification the trial court's ruling that the
property should entirely be reconveyed to the
Shirley and Rogelio.
Petitioner moved for reconsideration. In a
Resolution dated July 21, 2010, the appellate
court denied the motion for lack of merit. Hence,
the reason of filing a petition questioning errors
that the courts may have made.
ISSUE: Whether or not the CA erred when it
affirmed the decision of the RTC by sustaining
the finding that the petitioner was not a
purchaser in good faith.
HELD: Petitioner is not a buyer in good faith.
Even if the petitioner had contended that she
had examined the Transfer Certificate of Title
over the subject property, the court held that
merely relying on the same while ignoring all
other surrounding circumstances relevant to the
sale.
Moreover, the court held that she did not
exercise prudence. For at the time of the sale,
her sister was residing at the same Village where
the property was situated. She could have easily
checked if Rogelio has the capacity to dispose
the property. The respondent had even warned
her neighbors in the Village, including her sister,
not to engage in any deal with her husband
because there are pending cases filed against
him.
Another were the issues surrounding the
execution of the Deed of Absolute Sale had also
pose question on the claim of petitioner that she
is a buyer in good faith. As correctly observed by
both courts, the Deed of Absolute Sale was
executed and dated on December 29, 1992.
However, the Community Tax Certificates of the
witnesses therein were dated January 2 and 20,
1993. While this irregularity is not a direct proof
of the intent of the parties to the sale to make it
appear that the Deed of Absolute Sale was
executed on December 29, 1992 or before
Shirley filed the petition for legal separation on
January 29, 1993it is circumstantial and

PROPERTY CASES | Digested by Terence Valdehueza And Mia Unabia

relevant to the claim of herein petitioner as an

innocent purchaser for value. In addition to
those, in the Deed of Absolute Sale dated
December 29, 1992, the civil status of Rogelio as
seller was not stated, while petitioner as buyer
was indicated as "single. It puzzles the Court
that while petitioner has repeatedly claimed that
Rogelio is "single" under the Transfer Certificate
of Title and two tax declarations, his civil status
as seller was not stated in the Deed of Absolute
Sale - further creating a cloud on the claim of
petitioner that she is an innocent purchaser for
value.

which, in turn, is a form of a stream; therefore,

belonging to the public dominion. It said that
petitioner could not close its eyes or ignore the
fact, which is glaring in its own title, that the 3meter strip was indeed reserved for public
easement. By relying on the Transfer Certificate
of Title it is then estopped from claiming
ownership and enforcing its supposed right.
Unlike the trial court, however, the CA noted that
the proper party entitled to seek recovery of
possession of the contested portion is not the
City of Las Pias, but the Republic of the
Philippines, through the SG, pursuant to Section
101 of C.A. No. 141.

PILAR
DEVELOPMENT
CORPORATION,
Petitioner, v. RAMON
DUMADAG,
et
al, Respondents.
G.R. No. 194336
March 11, 2013

The motion for reconsideration filed by petitioner

was denied by the CA per Resolution dated
October 29, 2010, hence, this petition.

FACTS: On July 1, 2002, petitioner filed a

complaint for accion publiciana with damages
against respondents for allegedly building their
shanties, without its knowledge and consent, in
Pilar Village Subd situated in Las Pias City. The
petitioner claims that said parcel of land, which
is duly registered in its name, was designated as
an open space of Pilar Village Subd intended for
village recreational facilities and amenities for
subdivision residents. In their Answer with
Counterclaim, respondents denied the material
allegations of the Complaint and briefly asserted
that it is the local government, not petitioner,
which has jurisdiction and authority over them.
Trial ensued. Both parties presented their
respective witnesses and the trial court
additionally conducted an ocular inspection of
the subject property. On May 30, 2007, the trial
court dismissed petitioner's complaint, finding
that the land being occupied by respondents are
situated on the sloping area going down and
leading towards the Mahabang Ilog Creek and
within the three-meter legal easement; thus,
considered as public property and part of public
dominion, which could not be owned by
petitioner.
The
trial
court
opined
that
respondents have a better right to possess the
occupied lot, since they are in an area reserved
for public easement purposes and that only the
local government of Las Pias City could institute
an action for recovery of possession or
ownership.
Petitioner filed a motion for reconsideration, but
the same was denied by the trial court in its
Order dated August 21, 2007. Consequently,
petitioner elevated the matter to the Court of
Appeals which, on March 5, 2010, sustained the
dismissal of the case.
Referring to Section 2 of A.O. No. 99-21 of the
DENR, the appellate court ruled that the 3-meter
area being disputed is located along the creek

ISSUE: Whether or not Pilar Development

Corporation is entitled to the lawful possession of
the 3-meter easement, as provided by Art. 630
of the New Civil Code.
HELD: The court ruled that Pilar Development
Corporation is not lawfully entitled to the 3meter easement. This is because, according to
the lands Transfer Certificate of Title the said
easement has a reservation, to wit:
That the 3.00 meter strip of the lot
described herein along the Mahabang Ilog
Creek is reserved for public easement
purposes and to limitations imposed by
RA No. 440.
Also, though Art. 630 of the New Civil Code
provides for the general rule that "the owner of
the servient estate retains the ownership of the
portion on which the easement is established,
and may use the same in such a manner as not
to affect the exercise of the easement," Article
635 thereof is specific in saying that "all matters
concerning easements established for public or
communal use shall be governed by the special
laws and regulations relating thereto, and, in the
absence thereof, by the provisions of this Title
Title VII on Easements or Servitudes."
Furthermore, according to DENR A.O. No. 99-21,
When
titled
lands
are
subdivided
or
consolidated-subdivided into lots for residential,
commercial
or
industrial
purposes
the
segregation of the three (3) meter wide strip
along the banks of rivers or streams shall be
observed and be made part of the open space
requirement pursuant to P.D. 1216. The strip
shall be preserved and shall not be subject to
subsequent subdivision. Certainly, in the case of
residential subdivisions, the allocation of the 3meter strip along the banks of a stream, like the
Mahabang Ilog Creek in this case, is required and
shall be considered as forming part of the open
space requirement pursuant to P.D. 1216 dated
October 14, 1977. Said law is explicit: open
spaces are "for public use and are, therefore,

PROPERTY CASES | Digested by Terence Valdehueza And Mia Unabia

beyond the commerce of men" and that "[the]

areas reserved for parks, playgrounds and
recreational use shall be non-alienable public
lands, and non-buildable."

expenses, and costs be awarded in their favor;

and finally, that injunctive relief be issued
against respondent to prevent it from selling the
subject property.

The Court, however, cannot agree with the trial

court's opinion, as to which the CA did not pass
upon, that respondents have a better right to
possess the subject portion of the land because
they are occupying an area reserved for public
easement purposes. Similar to petitioner,
respondents have no right or title over it
precisely because it is public land. Likewise, we
repeatedly held that squatters have no
possessory rights over the land intruded upon.
The length of time that they may have physically
occupied the land is immaterial; they are
deemed to have entered the same in bad faith,
such that the nature of their possession is
presumed to have retained the same character
throughout their occupancy.

In its Answer with Special Affirmative Defenses

and Counterclaim, respondent claimed that
petitioners have no cause of action; that TCT No.
T- 63184 is a valid and subsisting title; that the
case for quieting of title constitutes a collateral
attack upon TCT No. T-63184; and that
petitioners have no title to the subject property
and are mere illegal occupants thereof. Thus, it
prayed for the dismissal of Civil Case No. 4946-R
and an award of exemplary damages, attorneys
fees, litigation expenses, and costs in its favor.

RESIDENTS
OF
LOWER
ATAB
AND
TEACHERS' VILLAGE, STO. TIMAS PROPER
BARANGAY, BAGUIO CITY, REPRESENTED BY
PULAS, LAPAO, ET AL, Petitioners, v. STA.
MONICA INDUSTRIAL AND DEVELOPMENT
CORP., Respondent.
G.R. No. 198878
October 15, 2014
FACTS: In May 2001, petitioners residents of
Lower Atab & Teachers Village, Sto. Tomas
Proper Barangay, Baguio City filed a civil case
for quieting of title with damages against
respondent
Sta.
Monica
Industrial
and
Development Corporation. The case was
docketed as Civil Case No. 4946-R and assigned
to Branch 59 of the Baguio RTC. The Complaint in
said case essentially alleged that petitioners are
successors and transferees-in-interest of Torres,
the supposed owner of an unregistered parcel of
land in Baguio City (the subject property,
consisting of 177,778 square meters) which
Torres possessed and declared for tax purposes
in 1918; that they are in possession of the
subject property in the concept of owner,
declared their respective lots and homes for tax
purposes, and paid the real estate taxes thereon;
that in May 2000, respondent began to erect a
fence on the subject property, claiming that it is
the owner of a large portion thereof by virtue of
Transfer Certificate of Title No. T-63184 (TCT No.
T-63184); that said TCT No. T-63184 is null and
void, as it was derived from Original Certificate
of Title No. O-281 (OCT No. O-281), which was
declared void pursuant to Presidential Decree No.
1271 (PD 1271) and in the decided case of
Republic v. Marcos; and that TCT No. T-63184 is a
cloud upon their title and interests and should
therefore be cancelled. Petitioners thus prayed
that respondents TCT No. T-63184
be
surrendered and cancelled; that actual, moral
and exemplary damages, attorneys fees, legal

ISSUES: Petitioners raise the following issues in

this Petition:
1. The Trial Court and the Court of Appeals erred
in finding that the Petitioners x x x have no
cause of action.
2. The Trial Court and the Court of Appeals erred
in finding that the action is a collateral attack on
the Torrens Title of respondent Corporation.
3. The Trial Court and the Court of Appeals erred
in finding that the present action is to annul the
title of respondent Corporation due to fraud,
[thus] it should be the Solicitor General who
should file the case for reversion.
4. The Trial Court and the Court of Appeals erred
in finding that the validation of TCT No. T-63184
registered in the name of the respondent
corporation was in accordance with law.
HELD: The Court denies the Petition. For an
action to quiet title to prosper, two indispensable
requisites must be present, namely: "(1) the
plaintiff or complainant has a legal or an
equitable title to or interest in the real property
subject of the action; and (2) the deed, claim,
encumbrance, or proceeding claimed to be
casting cloud on his title must be shown to be in
fact invalid or inoperative despite its prima facie
appearance of validity or legal efficacy."
"Legal title denotes registered ownership, while
equitable title means beneficial ownership."
Beneficial ownership has been defined as
ownership recognized by law and capable of
being enforced in the courts at the suit of the
beneficial
owner.
Blacks
Law
Dictionary
indicates that the term is used in two senses:
first, to indicate the interest of a beneficiary in
trust
property
(also
called
"equitable
ownership"); and second, to refer to the power of
a corporate shareholder to buy or sell the shares,
though the shareholder is not registered in the
corporations books as the owner. Usually,
beneficial ownership is distinguished from naked
ownership, which is the enjoyment of all the
benefits and privileges of ownership, as against
possession of the bare title to property.

PROPERTY CASES | Digested by Terence Valdehueza And Mia Unabia

Petitioners do not have legal or equitable title to

the subject property. Evidently, there are no
certificates of title in their respective names. And
by their own admission in their pleadings,
specifically
in
their
pre-trial
brief
and
memorandum before the trial court, they
acknowledged that they applied for the purchase
of the property from the government, through
town site sales applications coursed through the
DENR. In their Petition before this Court, they
particularly prayed that TCT No. T-63184 be
nullified in order that the said title would not
hinder the approval of their town site sales
applications pending with the DENR. Thus,
petitioners admitted that they are not the
owners of the subject property; the same
constitutes state or government land which they
would like to acquire by purchase. It would have
been different if they were directly claiming the
property as their own as a result of acquisitive
prescription, which would then give them the
requisite equitable title. By stating that they
were in the process of applying to purchase the
subject property from the government, they
admitted that they had no such equitable title, at
the very least, which should allow them to
prosecute a case for quieting of title.

dismissed by the government which could

indicate that the subject property is still available
for distribution to qualified beneficiaries. If TCT
No. T-63184 is indeed null and void, then such
proceeding would only be proper to nullify the
same. It is just that a quieting of title case is not
an option for petitioners, because in order to
maintain such action, it is primarily required that
the plaintiff must have legal or equitable title to
the subject property a condition which they
could not satisfy.

In short, petitioners recognize that legal and

equitable title to the subject property lies in the
State. Thus, as to them, quieting of title is not an
available remedy.

Consequently, petitioner filed a Petition for

Dissolution of Conjugal Partnership dated
December 14, 2000 praying for the distribution
of the following described properties claimed to
have been acquired during the subsistence of
their marriage, to wit:
By Purchase:
a. Lot 1, Block 3 of the consolidated survey of
Lots 2144 & 2147 of the Dumaguete Cadastre,
covered by Transfer Certificate of Title (TCT) No.
22846, containing an area of 252 square meters
(sq.m.), including a residential house constructed
thereon.
b. Lot 2142 of the Dumaguete Cadastre, covered
by TCT No. 21974, containing an area of 806
sq.m., including a residential house constructed
thereon.
c. Lot 5845 of the Dumaguete Cadastre, covered
by TCT No. 21306, containing an area of 756
sq.m.
d. Lot 4, Block 4 of the consolidated survey of
Lots 2144 & 2147 of the Dumaguete Cadastre,
covered by TCT No. 21307, containing an area of
45 sq.m.

Lands within the Baguio Townsite Reservation are

public land. Laws and decrees such as PD 1271
were passed recognizing ownership acquired by
individuals over portions of the Baguio Townsite
Reservation, but evidently, those who do not fall
within the coverage of said laws and decrees
the petitioners included cannot claim
ownership over property falling within the said
reservation. This explains why they have
pending applications to purchase the portions of
the subject property which they occupy; they
have no legal or equitable claim to the same,
unless ownership by acquisitive prescription is
specifically authorized with respect to such
lands, in which case they may prove their
adverse possession, if so. As far as this case is
concerned, the extent of petitioners possession
has not been sufficiently shown, and by their
application to purchase the subject property, it
appears that they are not claiming the same
through acquisitive prescription.
The trial and appellate courts are correct in
dismissing Civil Case No. 4946-R; however, they
failed to appreciate petitioners admission of lack
of equitable title which denies them the standing
to institute a case for quieting of title.
Nevertheless, they are not precluded from filing
another case a direct proceeding to question
respondents TCT No. T-63184; after all, it
appears that their townsite sales applications are
still pending and have not been summarily

With the conclusion arrived at, the Court finds no

need to resolve the other issues raised.
WILLIAM BEUMER, Petitioner, vs. AVELINA
AMORES, Respondent.
G.R. No. 195670
December 3, 2012
FACTS: Petitioner, a Dutch National, and
respondent, a Filipina, married in March 29,
1980. After several years, the RTC of Negros
Oriental, Branch 32, declared the nullity of their
marriage in the Decision dated November 10,
2000 on the basis of the formers psychological
incapacity as contemplated in Article 36 of the
Family Code.

By way of inheritance:
e. 1/7 of Lot 2055-A of the Dumaguete Cadastre,
covered by TCT No. 23567, containing an area of
2,635 sq.m. (the area that appertains to the
conjugal partnership is 376.45 sq.m.).
f. 1/15 of Lot 2055-I of the Dumaguete Cadastre,
covered by TCT No. 23575, containing an area of
360 sq.m. (the area that appertains to the
conjugal partnership is 24 sq.m.).
In defense, respondent averred that, with the
exception of their two (2) residential houses on

PROPERTY CASES | Digested by Terence Valdehueza And Mia Unabia

Lots 1 and 2142, she and petitioner did not

acquire any conjugal properties during their
marriage, the truth being that she used her own
personal money to purchase Lots 1, 2142, 5845
and 4 out of her personal funds and Lots 2055-A
and 2055-I by way of inheritance. She submitted
a joint affidavit executed by her and petitioner
attesting to the fact that she purchased Lot 2142
and the improvements thereon using her own
money.
Accordingly, respondent sought the dismissal of
the petition for dissolution as well as payment for
attorneys fees and litigation expenses.
During trial, petitioner testified that while Lots 1,
2142, 5845 and 4 were registered in the name of
respondent, these properties were acquired with
the money he received from the Dutch
government benefit since respondent did not
have sufficient income to pay for their
acquisition. He also claimed that the joint
affidavit they submitted before the Register of
Deeds of Dumaguete City was contrary to Article
89 of the Family Code, hence, invalid.
For her part, respondent maintained that the
money used for the purchase of the lots came
exclusively from her personal funds, in particular,
her earnings from selling jewelry as well as
products from Avon, Triumph and Tupperware.
She further asserted that after she filed for
annulment of their marriage in 1996, petitioner
transferred to their second house and brought
along with him certain personal properties,
consisting of drills, a welding machine, grinders,
clamps, etc. She alleged that these tools and
equipment have a total cost of P500,000.00.
ISSUE: Whether or not Beumer has a right to
assert or claim half or whole of the purchase
price used in the purchase of the real properties
subject of this case.
HELD: Undeniably, petitioner openly admitted
that he is well aware of the constitutional
prohibition and even asseverated that, because
of such prohibition, he and respondent registered
the subject properties in the latters name.
Clearly, petitioners actuations showed his
palpable intent to skirt the constitutional
prohibition. On the basis of such admission, the
Court finds no reason why it should not apply the
Muller ruling and accordingly, deny petitioners
claim for reimbursement.
In this case, petitioners statements regarding
the real source of the funds used to purchase the
subject parcels of land dilute the veracity of his
claims: While admitting to have previously
executed a joint affidavit that respondents
personal funds were used to purchase Lot 1, he
likewise claimed that his personal disability funds
were used to acquire the same. Evidently, these
inconsistencies show his untruthfulness. Thus, as

petitioner has come before the Court with

unclean hands, he is now precluded from seeking
any equitable refuge.
In any event, the Court cannot, even on the
grounds of equity, grant reimbursement to
petitioner given that he acquired no right
whatsoever over the subject properties by virtue
of its unconstitutional purchase. It is wellestablished that equity as a rule will follow the
law and will not permit that to be done indirectly
which, because of public policy, cannot be done
directly. Surely, a contract that violates the
Constitution and the law is null and void, vests
no rights, creates no obligations and produces no
legal effect at all. Corollary thereto, under Article
1412 of the Civil Code, petitioner cannot have
the subject properties deeded to him or allow
him to recover the money he had spent for the
purchase thereof. The law will not aid either
party to an illegal contract or agreement; it
leaves the parties where it finds them. Indeed,
one cannot salvage any rights from an
unconstitutional transaction knowingly entered
into.

FLORENTINO W. LEONG AND ELENA LEONG,

ET
AL., Petitioners, v.
EDNA
C.
SEE, Respondent.
G.R. No. 194077
December 3, 2014
FACTS: The spouses Florentino Leong and
Carmelita Leong used to own the property
located at No. 53941 Z.P. De Guzman Street,
Quiapo, Manila.
Petitioner Elena Leong (Elena) is Florentino's
sister-in-law. She had stayed with her in-laws on
the property rental-free for over two decades
until the building they lived in was razed by fire.
They then constructed makeshift houses, and the
rental-free arrangement continued. Florentino
and Carmelita immigrated to the United States
and eventually had their marriage dissolved in
Illinois. A provision in their marital settlement
agreement states that"Florentino shall convey
and quitclaim all of his right, title and interest in
and to 540 De Guzman Street, Manila,
Philippines . . . to Carmelita."
The Court of Appeals found that "[a]pparently
intercalated in the lower margin of page 12 of
the instrument was a long-hand scribbling of a
proviso,
purporting
to
be
a
footnote
remark":Neither party shall evict or charge rent
to relatives of the parties, or convey title, until it
has been established that Florentino has clear
title to the Malabon property. Clear title to be

PROPERTY CASES | Digested by Terence Valdehueza And Mia Unabia

established by the attorneys for the parties or

the ruling of a court of competent jurisdiction. In
the event Florentino does not obtain clear title,
this court reserves jurisdiction to reapportion the
properties or their values to effect a 50-50
division of the value of the 2 remaining Philippine
properties.
On November 14, 1996, Carmelita sold the land
to Edna. In lieu of Florentino's signature of
conformity in the deed of absolute sale,
Carmelita presented to Edna and her father,
witness Ernesto See, a waiver of interest
notarized on March 11, 1996 in Illinois. In this
waiver, Florentino reiterated his quitclaim over
his right, title, and interest to the land.
Consequently, the lands title, covered by TCT
No. 231105, was transferred to Edna's name.
Edna was aware of the Leong relatives staying in
the makeshift houses on the land. Carmelita
assured her that her nieces and nephews would
move out, but demands to vacate were
unheeded.
On April 1, 1997, Edna filed a complaint for
recovery of possession against Elena and the
other relatives of the Leong ex-spouses.
In response, Elena alleged the titles legal
infirmity for lack of Florentino's conformity to its
sale. She argued that Carmelita's noncompliance
with the proviso in the property agreement
that the Quiapo property "may not be alienated
without Florentino first obtaining a clean title
over the Malabon property" annulled the
transfer to Edna.
On April 23, 1997, Florentino filed a complaint for
declaration of nullity of contract, title, and
damages against Carmelita Leong, Edna C. See,
and the Manila Register of Deeds, alleging that

the sale was without his consent. The two cases

were consolidated.
ISSUE: Whether or not Edna was a purchaser in
good faith.
HELD: First, good faith is presumed, and
petitioners did not substantiate their bold
allegation of fraud. Second, respondent did
notrely on the clean title alone precisely because
of the possession by third parties, thus, she also
relied on Florentinos waiver of interest.
Respondent even verified the authenticity of the
title at the Manila Register of Deeds with her
father and Carmelita. These further inquiries
prove respondents good faith.
By her overt acts, Edna See with her father
verified the authenticity of Carmelitas land title
at the Registry of Deeds of Manila. There was no
annotation on the same thus deemed a clean
title (page 19, TSN, 12 January 2005). Also, she
relied on the duly executed and notarized
Certificate of Authority issued by the State of
Illinois and Certificate of Authentication issued
by the Consul of the Republic of the Philippines
for Illinois in support to the Waiver of Interest
incorporated in the Deed of Absolute Sale
presented to her by Carmelita (Exhibit 2).
Examination of the assailed Certificate of
Authority shows that it is valid and regular on its
face. It contains a notarial seal.
The assailed Certificate of Authority is a
notarized document and therefore, presumed to
be valid and duly executed. Thus, Edna Sees
reliance on the notarial acknowledgment found
in the duly notarized Certificate of Authority
presented by Carmelita is sufficient evidence of
good faith.

PROPERTY CASES | Digested by Terence Valdehueza And Mia Unabia