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G.R. No.

122047 October 12, 2000

SPOUSES SERAFIN SI AND ANITA BONODE SI, petitioners,


vs.
COURT OF APPEALS, SPOUSES JOSE ARMADA and REMEDIOS ALMANZOR (deceased, and
substituted by heirs: Cynthia Armada, Danilo Armada and Vicente Armada) respondents.

DECISION

QUISUMBING, J.:

This petition for certiorari under Rule 45 assails the Decision1 dated March 25, 1994, of the Court of Appeals
and its Resolutions2 dated March 24, 1995 and September 6, 1995 in CA-G.R. CV No. 30727. The Court of
Appeals reversed the decision of the Regional Trial Court of Pasig City, Branch 113, and nullified the sale of
the subject lot by the spouses Crisostomo and Cresenciana Armada to spouses Serafin and Anita Si. The
dispositive portion of the respondent court's decision reads:

"WHEREFORE, in view of the foregoing, the decision appealed from is hereby REVERSED, and a new one is
rendered:

1) Annulling and declaring as invalid the registration of the Deed of Absolute Sale dated March 27,
1979 executed by Cresenciana V. Alejo in favor of Anita Bonode Si.

2) Ordering the Register of Deeds of Pasay City to annul and cancel Transfer Certificate of Title No.
24751, issued in the name of Anita Bonode Si, married to Serafin D. Si., Jose R. Armada, married to
Remedios Almanzor and Dr. Severo R. Armada Jr., single.

3) Ordering the Register of Deeds of Pasay City to reconstitute and revive Transfer Certificate of Title
No. 16007 in the names of Jose, Crisostomo and Severo, Jr.

4) That plaintiffs be allowed to repurchase or redeem the share corresponding to the share of
Crisostomo Armada within thirty (30) days from notice in writing by Crisostomo Armada.

5) The defendants-appellees are jointly and severally ordered to pay the plaintiffs-appellants the sum
of P10,000.00 as moral damages.

6) The defendants-appellees are jointly and severally ordered to pay the plaintiff-appellants the sum of
P10,000.00 as attorney's fees and litigation expenses and costs of suit.

SO ORDERED."3

The factual background of the case is as follows:

The 340 square meters of land, situated in San Jose District, Pasay City, the property in dispute, originally
belonged to Escolastica, wife of Severo Armada, Sr. This was covered by Transfer Certificate of Title (TCT) No.
(17345) 2460. During the lifetime of the spouses, the property was transferred to their children and the Registry
of Deeds, Pasay City, issued TCT No. 16007 in the names of the three sons, as follows : "DR. CRISOSTOMO
R. ARMADA, married to Cresenciana V. Alejo, 113.34 Square Meters; JOSE R. ARMADA, married to
Remedios Almanzor, 113.33 Square Meters; and DR. SEVERO R. ARMADA, Jr., single, all of legal age,
Filipinos."4 Annotated also in the title is the total cancellation of said title "... by virtue of the Deed of Sale, (P.E.
77952/T-24751), dated March 28, 1979, executed by CRESENCIANA V. ALEJO, as attorney-in-fact of
CRISOSTOMO R. ARMADA, conveying 113.34 square meters of the property herein, in favor of ANITA
BONODE SI, married to Serafin D. Si, for the sum of P75,000.00, issuing in lieu thereof Transfer Certificate of
Title No. 24751, Reg. Book T-102. (Doc. No. 17, Page No. 5, Book No. 253 of Notary Public of Pasay City,
Manila, Julian Florentino)."5
On April 15, 1980, herein spouses Jose Armada and Remedios Almanzor, filed a complaint for Annulment of
Deed of Sale and Reconveyance of Title with Damages, against herein petitioners Anita and Serafin Si and
Conrado Isada, brother-in-law of Cresenciana. Isada brokered the sale.

The complaint alleged that Conrado Isada sold Crisostomo's share by making it appear that Cresenciana, the
attorney-in-fact of her husband, is a Filipino citizen, residing with Isada at No. 13-4th Camarilla Street, Murphy,
Cubao, Quezon City. By this time, Crisostomo and Cresenciana had migrated and were already citizens of the
United States of America. It also stated that when petitioners registered the deed of absolute sale they inserted
the phrase "... and that the co-owners are not interested in buying the same in spite of notice to them.", and
that petitioners knew of the misrepresentations of Conrado. Further, the complaint alleged that the other
owners, Jose and Severo, Jr., had no written notice of the sale; and that all upon learning of the sale to the
spouses Si, private respondents filed a complaint for annulment of sale and reconveyance of title with
damages, claiming they had a right of redemption.

Petitioners, on the other hand, alleged that on October 2, 1954, Escolastica, with the consent of her husband
executed three separate deeds of sale (Exhibits 1, 2, and 3)6 conveying 113.34 square meters of the property to
Severo, and 113.33 square meters each to Crisostomo and Jose. The three deeds of sale particularly
described the portion conveyed to each son in metes and bounds. Petitioners contend that since the property
was already three distinct parcels of land, there was no longer co-ownership among the brothers. Hence, Jose
and Severo, Jr. had no right of redemption when Crisostomo sold his share to the spouses Si. Petitioners point
out that it was only because the Armada brothers failed to submit the necessary subdivision plan to the Office
of the Register of Deeds in Pasay City that separate titles were not issued and TCT No. 16007 was issued and
registered in the names of Jose, Crisostomo, and Severo, Jr.

After trial on the merits, the court ruled for petitioners:

"IN VIEW OF ALL THE FOREGOING, the complaint is hereby DISMISSED. With costs against the plaintiffs." 7

Private respondents appealed to the Court of Appeals. On March 25, 1994, the appellate court issued the
decision now assailed by petitioners. In reversing the decision of the trial court and ruling for private
respondents, the Court of Appeals found that:

"A careful examination of TCT No. 16007 (Exh. 'A') shows that the portion sold by virtue of the Deeds of Sale
(Exh. 1, 2, & 3) to the Armada brothers do not appear in the said title, neither does it indicate the particular area
sold. Moreover, no evidence was presented to show that the Register of Deeds issued TCT No. 16007 (Exh.
'A') on the basis of the said deeds of Sale. In fact, TCT No. 16007 (Exh. 'A') shows that the lot is co-owned by
Jose, Crisostomo and Severo, Jr. in the proportion of 113.33, 113.34 and 113.33 sq. m. respectively.

Furthermore, the evidence on record shows that the Deed of Absolute Sale (Exh. 'B'), executed by Cresencia
Armada in favor of defendants Si, stated that the portion sold was the 'undivided one hundred thirteen & 34/100
(113.34) square meters' of the parcel of land covered by TCT NO. 16007 of the Registry of Deeds for Pasay
City, which means that what was sold to defendants are still undetermined and unidentifiable, as the area sold
remains a portion of the whole.

Moreover, plaintiff Remedi[o]s Armada testified that on March 27, 1979, Crisostomo Armada, thru his attorney-
in-fact and co-defendant, Cresenciana Alejo, sold his undivided 113.34 share to defendants, Sps. Si as
evidenced by a Deed of Absolute Sale (Exh. 'B'), and presented for registration with the Register of Deeds
(Exh. 'B-1') without notifying plaintiffs of the sale (TSN, pp. 6-8, December 20, 1988). Instead, it appears that
the phrase 'and that the co-owners are not interested in buying the same inspite of notice to them', was
inserted in the Deed of Sale (Exh. 'B').

xxx

Otherwise stated, the sale by a (sic) co-owner of his share in the undivided property is not invalid, but shall not
be recorded in the Registry Property, unless accompanied by an affidavit of the Vendor that he has given
written notice thereof to all possible redemptioners."8
On August 29, 1994, petitioners' counsel on record, Atty. Roberto B. Yam received a copy of the CA decision.
On October 14, 1994, he filed a motion for reconsideration, but it was denied by the Court of Appeals on
November 21, 1994, for being filed out of time.

On December 5, 1994, petitioners filed their motion for new trial under Section 1, Rule 53 of the Revised Rules
of Court.9 Petitioners presented new evidence, TCT No. (17345) 2460, registered in the name of Escolastica de
la Rosa, married to Severo Armada, Sr., with annotation at the back stating that the cancellation was by virtue
of three deeds of sale in favor of Escolastica's sons. On March 24, 1995, respondent court denied the motion,
reasoning that when the motion was filed, the reglementary period had lapsed and the decision had become
final and executory. Petitioners' motion for reconsideration of said resolution was denied.

Hence, the present petition, alleging that:

"1. Respondent Court of Appeals committed a reversible error in ruling that a co-ownership still
existed.

"2. Respondent Court of Appeals committed a reversible error in denying the Motion for
Reconsideration of its Decision of 25 March 1994 on purely technical grounds.

"3. Respondent Court of Appeals committed a reversible error in denying the Motion for New Trial.

"4. Respondent Court of Appeals committed a reversible error in ordering petitioners to pay moral
damages, attorney's fees, litigation expenses and the costs of the suit."10

In essence, this Court is asked to resolve: (1) whether respondent court erred in denying petitioners' motion for
reconsideration and/or the Motion for New Trial; (2) whether private respondents are co-owners who are legally
entitled to redeem the lot under Article 1623 of the Civil Code;11 and (3) whether the award of moral damages,
attorney's fees and costs of suit is correct.

The pivotal issue is whether private respondents may claim the right of redemption under Art. 1623 of the Civil
Code. The trial court found that the disputed land was not part of an undivided estate. It held that the three
deeds of absolute sale12 technically described the portion sold to each son. The portions belonging to the three
sons were separately declared for taxation purposes with the Assessor's Office of Pasay City on September
21, 1970.13 Jose's testimony that the land was undivided was contradicted by his wife when she said they had
been receiving rent from the property specifically allotted to Jose.14 More significantly, on January 9, 1995, the
Registry of Deeds of Pasay City cancelled TCT 24751 and issued three new titles as follows: (1) TCT
13459415 in favor of Severo Armada, Jr.; (2) TCT 13459516 under the name of Anita Bonode Si, married to
Serafin Si; and (3) TCT 13459617 owned by Jose Armada, married to Remedios Almanzor. All these are on
record.

However, the Court of Appeals' decision contradicted the trial court's findings.18

In instances when the findings of fact of the Court of Appeals are at variance with those of the trial court, or
when the inference drawn by the Court of Appeals from the facts is manifestly mistaken, this Court will not
hesitate to review the evidence in order to arrive at the correct factual conclusion.19 This we have done in this
case. It is our considered view now, that the trial court is correct when it found that:

"Rightfully, as early as October 2, 1954, the lot in question had already been partitioned when their parents
executed three (3) deed of sales (sic) in favor of Jose, Crisostomo and Severo, all surnamed Armada (Exh. 1,
2, & 3), which documents purports to have been registered with the Register of Deeds of Pasay City, on
September 18, 1970, and as a consequence TCT No. 16007 (Exh. A) was issued. Notably, every portion
conveyed and transferred to the three sons was definitely described and segregated and with the
corresponding technical description (sic). In short, this is what we call extrajudicial partition. Moreover, every
portion belonging to the three sons has been declared for taxation purposes with the Assessor's Office of
Pasay City on September 21, 1970. These are the unblinkable facts that the portion sold to defendant spouses
Si by defendants Crisostomo Armada and Cresenciana Armada was concretely determined and identifiable.
The fact that the three portions are embraced in one certificate of title does not make said portions less
determinable or identifiable or distinguishable, one from the other, nor that dominion over each portion less
exclusive, in their respective owners. Hence, no right of redemption among co-owners exists."20 (citation
omitted)

". . . [T]he herein plaintiffs cannot deny the fact that they did not have knowledge about the impending sale of
this portion. The truth of the matter is that they were properly notified. Reacting to such knowledge and
notification they wrote defendant Dr. Crisostomo Armada on February 22, 1979, a portion of said letter is
revealing: 'Well you are the king of yourselves, and you can sell your share of Levereza."21 (emphasis omitted)

After the physical division of the lot among the brothers, the community ownership terminated, and the right of
preemption or redemption for each brother was no longer available.22

Under Art. 484 of the Civil Code,23 there is co-ownership whenever the ownership of an undivided thing or right
belongs to different persons. There is no co-ownership when the different portions owned by different people
are already concretely determined and separately identifiable, even if not yet technically described. 24 This
situation makes inapplicable the provision on the right of redemption of a co-owner in the Civil Code, as follows:

"Art. 1623. The right of legal pre-emption or redemption shall not be exercised except within thirty days from
the notice in writing by the prospective vendor, or by the vendor, as the case may be. The deed of sale shall
not be recorded in the Registry of Property, unless accompanied by an affidavit of the vendor that he has given
written notice thereof to all possible redemptioners.

The right of redemption of co-owners excludes that of adjoining owners."

Moreover, we note that private respondent Jose Armada was well informed of the impending sale of
Crisostomo's share in the land. In a letter dated February 22, 1979, Jose told his brother Crisostomo: "Well you
are the king of yourselves, and you can sell your share of Leveriza."25 Co-owners with actual notice of the sale
are not entitled to written notice. A written notice is a formal requisite to make certain that the co-owners have
actual notice of the sale to enable them to exercise their right of redemption within the limited period of thirty
days. But where the co-owners had actual notice of the sale at the time thereof and/or afterwards, a written
notice of a fact already known to them, would be superfluous. The statute does not demand what is
unnecessary.26

Considering that respondent Court of Appeals erred in holding that herein private respondent could redeem the
lot bought by petitioners, the issue of whether the appellate court erred in denying petitioners' motions for
reconsideration and new trial need not be delved into. The same is true with respect to the questioned award
1âw phi1

of damages and attorney's fees. Petitioners filed their complaint in good faith and as repeatedly held, we
cannot put a premium on the right to litigate.

WHEREFORE, the petition is GRANTED, the Decision of the Court of Appeals dated March 25, 1994 and its
Resolutions dated March 24, 1995 and September 6, 1995 in CA-G.R. CV No. 30727 are ANNULLED and SET
ASIDE. Civil Case No. 8023-P is DISMISSED for lack of merit. The decision of the Regional Trial Court of
Pasay City, Branch 113, promulgated on August 29, 1989, is REINSTATED.
G.R. No. 152716 October 23, 2003

ELNA MERCADO-FEHR, petitioner,


vs.
BRUNO FEHR, respondent.

DECISION

PUNO, J.:

This case arose from a petition for declaration of nullity of marriage on the ground of psychological incapacity to
comply with the essential marital obligations under Article 36 of the Family Code filed by petitioner Elna
Mercado-Fehr against respondent Bruno Fehr before the Regional Trial Court of Makati in March 1997. 1

After due proceedings, the trial court declared the marriage between petitioner and respondent void ab initio
under Article 36 of the Family Code and ordered the dissolution of their conjugal partnership of property.2 The
dispositive portion of the Decision dated January 30, 1998 states:

WHEREFORE, in the light of the foregoing, the marriage between Elna D. Mercado and Bruno F. Fehr on
March 14, 1985 is hereby declared null and void on the ground of psychological incapacity on the part of
respondent to perform the essential obligations of marriage under Article 36 of the Family Code.

Accordingly, the conjugal partnership of property existing between the parties is dissolved and in lieu thereof, a
regime of complete separation of property between the said spouses is established in accordance with the
pertinent provisions of the Family Code, without prejudice to the rights previously acquired by creditors. 1ª vvphi1.nét

Custody over the two minor children, MICHAEL BRUNO MERCADO FEHR and PATRICK FRANZ FEHR, is
hereby awarded to petitioner, she being the innocent spouse.

Let a copy of this Decision be duly recorded in the proper civil and property registries in accordance with Article
52 of the Family Code.

SO ORDERED.3

On August 24, 1999, the trial court issued an Order resolving the various motions4 filed by respondent after the
case had been decided. The Order pertained to the properties held by the parties, thus:

xxxxxxxxx

After a careful scrutiny of the inventory of properties submitted by both parties, the Court finds the following
properties to be excluded from the conjugal properties, namely:

a) the Bacolod property covered by Transfer Certificate of Title No. T-137232, considering that the
same is owned by petitioner’s parents, Herminio Mercado and Catalina D. Mercado xxx and

b) Suite 204 of the LCG Condominium covered by Condominium Certificate of Title No. 14735,
considering that the same was purchased on installment basis by respondent with his exclusive funds
prior to his marriage, as evidenced by a Contract to Sell dated July 26, 1983. xxx

Accordingly, the conjugal properties of the petitioner and respondent shall be distributed in the following
manner:

TO PETITIONER ELNA MERCADO:


a. Ground Floor, LCG Condominium, with an area of 671.84 sq. m., covered by Condominium
Certificate of Title No. 14734; and

b. Tamaraw FX (1995 model)

TO RESPONDENT BRUNO FRANZ FEHR:

a. Upper Basement, LCG Condominium, with an area of 180.81 sq. m. and covered by Condominium
Certificate of Title No. 14733; and

b. Nissan Sentra with Plate No. FDJ-533 (1994 model)

Furthermore, Suite 204, LCG Condominium with an area of 113.54 sq. m. and covered by Condominium
Certificate of Title NO. 14735 is hereby declared the EXCLUSIVE PROPERTY of respondent, BRUNO FRANZ
FEHR. Accordingly, petitioner is hereby directed to transfer ownership of Suite 204 in the name of respondent,
covered by Condominium Certificate of Title No. 14735, being respondent’s exclusive property, acquired prior
to his marriage.1aw phi 1.nét

Anent the monthly rentals prior to the issuance of this Order of the subject properties, namely the Ground Floor
Front (Friday’s Club), Ground Floor Rear Apartment and Upper Basement at LGC Condominium, all leased by
Bar 4 Corporation, the same shall be shared by the parties in common, in proportion to one-half each or share
and share alike, after deducting all expenses for Income Taxes, Business Permits, Realty Taxes, Municipal
License fees, clearances, etc. Accordingly, petitioner is hereby directed to deliver to respondent the following:
a) the balance of his share of the monthly rentals from February 1998 to May 1998; and b) his one-half share
(1/2) of the monthly rentals of the aforesaid properties from June 1998 up to this date. Thereafter, the parties
shall own and enjoy their respective share of the monthly rentals derived from the properties adjudicated to
them as stated above.

The Petitioner and Respondent are further enjoined to jointly support their minor children, Michael and Patrick
Fehr, for their education, uniforms, food and medical expenses.5

Petitioner filed a motion for reconsideration of said Order with respect to the adjudication of Suite 204, LCG
Condominium and the support of the children. Petitioner alleged that Suite 204 was purchased on installment
basis at the time when petitioner and respondent were living exclusively with each other as husband and wife
without the benefit of marriage, hence the rules on co-ownership should apply in accordance with Article 147 of
the Family Code. Petitioner further claimed that it would not be in the best interests of the children if she would
be made to demand periodically from respondent his share in the support of the children. She instead proposed
that the Upper Basement and the Lower Ground Floor of the LCG Condominium be adjudicated to her so that
she could use the income from the lease of said premises for the support of the children.6

Resolving said motion, the trial court held in an Order dated October 5, 2000 that since the marriage between
petitioner and respondent was declared void ab intio, the rules on co-ownership should apply in the liquidation
and partition of the properties they own in common pursuant to Article 147 of the Family Code. The court,
however, noted that the parties have already agreed in principle to divide the properties and/or proceeds from
the sale thereof proportionately among them and their children as follows: 1/3 for petitioner, 1/3 for respondent
and 1/3 for the children. It also affirmed its previous ruling that Suite 204 of LCG Condominium was acquired
prior to the couple’s cohabitation and therefore pertained solely to respondent.7 1ªvv phi1.nét

On November 28, 2000, petitioner filed a notice of appeal questioning the October 5, 2000 Order of the trial
court.8Respondent filed an Opposition to the Notice of Appeal.9 On January 12, 2001, petitioner withdrew the
notice of appeal10 and instead filed on the following day a special civil action for certiorari and prohibition with
the Court of Appeals, questioning the findings of the trial court in its Order dated October 5, 2000.11

The Court of Appeals, in its Decision dated October 26, 2001, dismissed the petition for certiorari for lack of
merit. The appellate court stated that petitioner has not shown any reason to warrant the issuance of a writ of
certiorari as the errors she raised were mere errors of judgment which were the proper subject of an ordinary
appeal, not a petition for certiorari.12

Petitioner filed a motion for reconsideration of said Decision, which was also denied by the appellate court. 13

Hence this petition. Petitioner raises the following arguments:

1) Petitioner correctly filed a petition for certiorari and prohibition against the Regional Trial Court of
Makati, Branch 149 in the Court of Appeals in view of the fact that the questioned orders were issued
with grave abuse of discretion amounting to excess of or lack of jurisdiction.

2) The Court of Appeals erred in ruling that the questioned orders were errors of judgment and not of
jurisdiction.14

We shall first address the procedural issue, whether the Court of Appeals erred in dismissing the special civil
action for certiorari filed by petitioner.

Petitioner argues that the filing of a petition for certiorari with the Court of Appeals was proper because the trial
court committed grave abuse of discretion in the issuance of its Order dated October 5, 2000, and there were
no other speedy and adequate remedies available. She asserts that the trial court committed grave abuse of
discretion when it held that Suite 204 of the LCG Condominium was the exclusive property of respondent,
although it was established that they lived together as husband and wife beginning March 1983, before the
execution of the Contract to Sell on July 26, 1983. Furthermore, the trial court’s ruling dividing their properties
into three, instead of two as provided under Article 147 of the Family Code, or four, as allegedly agreed by the
parties during a conference with the trial court judge on May 3, 2000, also constituted grave abuse of
discretion.15

Respondent, on the other hand, contends that petitioner may no longer avail of any remedy, whether an appeal
or a petition for certiorari, as she had lost all the right to appeal from the time the Decision of January 30, 1998
became final and executory. He argues that the Order of the trial court dated October 5, 2000 is no longer
assailable because it was merely issued to execute the final and executory Decision of January 30, 1998. He
also submits that the division of the properties into three and the distribution of 1/3 share each to the petitioner,
the respondent, and their children was proper, in accordance with Articles 50, 51, 147 and 148 of the Family
Code mandating the delivery of the presumptive legitime of the common children upon dissolution of the
property regime. Respondent further claims Suite 204 of LCG Condominium to be his exclusive property as it
was acquired on July 26, 1983, prior to their marriage on March 14, 1985. 16

A petition for certiorari is the proper remedy when any tribunal, board or officer exercising judicial or quasi-
judicial functions has acted without or in excess of its jurisdiction, or with grave abuse of discretion amounting
to lack or excess of jurisdiction and there is no appeal, nor any plain speedy, and adequate remedy at law.
Grave abuse of discretion is defined as the capricious and whimsical exercise of judgment as is equivalent to
lack of jurisdiction. As a general rule, a petition for certiorari will not lie if an appeal is the proper remedy such
as when an error of judgment or procedure is involved. As long as a court acts within its jurisdiction and does
not gravely abuse its discretion in the exercise thereof, any supposed error committed by it will amount to
nothing more than an error of judgment reviewable by a timely appeal and not assailable by a special civil
action of certiorari. However, in certain exceptional cases, where the rigid application of such rule will result in a
manifest failure or miscarriage of justice, the provisions of the Rules of Court which are technical rules may be
relaxed. Certiorari has been deemed to be justified, for instance, in order to prevent irreparable damage and
injury to a party where the trial judge has capriciously and whimsically exercised his judgment, or where there
may be danger of clear failure of justice, or where an ordinary appeal would simply be inadequate to relieve a
party from the injurious effects of the judgment complained of.17

The exception applies to the case at bar. We reject respondent’s submission that all the appellate remedies of
petitioner have been foreclosed when the Decision dated January 30, 1998 became final and executory. What
is being questioned in this petition is not the January 30, 1998 Decision of the trial court declaring the marriage
between petitioner and respondent void ab initio on the ground of psychological incapacity, but the Order of the
trial court dated October 5, 2000 dividing the common properties of petitioner and respondent into three—1/3 to
petitioner, 1/3 to respondent and 1/3 to their children, and affirming its previous ruling that Suite 204 of LCG
Condominium is the exclusive property of respondent. The issue on the validity of the marriage of petitioner
and respondent has long been settled in the main Decision and may no longer be the subject of review. There
were, however, incidental matters that had to be addressed regarding the dissolution of the property relations
of the parties as a result of the declaration of nullity of their marriage. The questioned Order pertained to the
division and distribution of the common properties of petitioner and respondent, pursuant to the court’s directive
in its main decision to dissolve the conjugal partnership. Said Order is a final Order as it finally disposes of the
issues concerning the partition of the common properties of petitioner and respondent, and as such it may be
appealed by the aggrieved party to the Court of Appeals via ordinary appeal. However, considering the merits
of the case, the Court believes that a blind adherence to the general rule will result in miscarriage of justice as it
will divest the petitioner of her just share in their common property, and thus, deprive her of a significant source
of income to support their children whom the court had entrusted to her care. We have held that where a rigid
application of the rule that certiorari cannot be a substitute for appeal will result in a manifest failure or
miscarriage of justice, the provisions of the Rules of Court which are technical rules may be relaxed. 18

We now go to the substantive issues. The crux of the petition is the ownership of Suite 204 of LCG
Condominium and how the properties acquired by petitioner and respondent should be partitioned.

It appears from the facts, as found by the trial court, that in March 1983, after two years of long-distance
courtship, petitioner left Cebu City and moved in with respondent in the latter’s residence in Metro Manila. Their
relations bore fruit and their first child, Michael Bruno Fehr, was born on December 3, 1983. The couple got
married on March 14, 1985. In the meantime, they purchased on installment a condominium unit, Suite 204, at
LCG Condominium, as evidenced by a Contract to Sell dated July 26, 1983 executed by respondent as the
buyer and J.V. Santos Commercial Corporation as the seller. Petitioner also signed the contract as witness,
using the name "Elna Mercado Fehr". Upon completion of payment, the title to the condominium unit was
issued in the name of petitioner.19

In light of these facts, we give more credence to petitioner’s submission that Suite 204 was acquired during the
parties’ cohabitation. Accordingly, under Article 147 of the Family Code, said property should be governed by
the rules on co-ownership. The Family Code provides:

Article 147. When a man and a woman who are capacitated to marry each other, live exclusively with each
other as husband and wife without the benefit of marriage or under a void marriage, their wages and salaries
shall be owned by them in equal shares and the property acquired by both of them through their work or
industry shall be governed by the rules on co-ownership.

In the absence of proof to the contrary, properties acquired while they lived together shall be presumed to have
been obtained by their joint efforts, work or industry, and shall be owned by them in equal shares. For purposes
of this Article, a party who did not participate in the acquisition by the other party of any property shall be
deemed to have contributed jointly to the acquisition thereof if the former’s efforts consisted in the care and
maintenance of their family and of the household.

Neither party can encumber or dispose by acts inter vivos of his or her share in the property acquired during
cohabitation and owned in common, without the consent of the other, until after the termination of their
cohabitation.

When only one of the parties to a void marriage is in good faith, the share of the party in bad faith in the co-
ownership shall be forfeited in favor of their common children. In case of default of or waiver by any or all of the
common children or their descendants, each vacant share shall belong to the respective surviving
descendants. (emphasis supplied)

Article 147 applies to unions of parties who are legally capacitated and not barred by any impediment to
contract marriage, but whose marriage is nonetheless void,20 as in the case at bar. This provision creates a co-
ownership with respect to the properties they acquire during their cohabitation.
We held in Valdes vs. Regional Trial Court, Br. 102, Quezon City:21

This peculiar kind of co-ownership applies when a man and a woman, suffering no legal impediment to marry
each other, so exclusively live together as husband and wife under a void marriage or without the benefit of
marriage. The term "capacitated" in the provision (in the first paragraph of the law) refers to the legal capacity
of a party to contract marriage, i.e., any "male or female of the age of eighteen years or upwards not under any
of the impediments mentioned in Article 37 and 38" of the Code.

Under this property regime, property acquired by both spouses through their work and industry shall be
governed by the rules on equal co-ownership. Any property acquired during the union is prima facie presumed
to have been obtained through their joint efforts. A party who did not participate in the acquisition of the
property shall still be considered as having contributed thereto jointly if said party’s "efforts consisted in the
care and maintenance of the family household."

Thus, for Article 147 to operate, the man and the woman: (1) must be capacitated to marry each other; (2) live
exclusively with each other as husband and wife; and (3) their union is without the benefit of marriage or their
marriage is void. All these elements are present in the case at bar. It has not been shown that petitioner and
respondent suffered any impediment to marry each other. They lived exclusively with each other as husband
and wife when petitioner moved in with respondent in his residence and were later united in marriage. Their
marriage, however, was found to be void under Article 36 of the Family Code because of respondent’s
psychological incapacity to comply with essential marital obligations.

The disputed property, Suite 204 of LCG Condominium, was purchased on installment basis on July 26, 1983,
at the time when petitioner and respondent were already living together. Hence, it should be considered as
common property of petitioner and respondent.

As regards the settlement of the common properties of petitioner and respondent, we hold that the Civil Code
provisions on co-ownership should apply. There is nothing in the records that support the pronouncement of
the trial court that the parties have agreed to divide the properties into three—1/3 share each to the petitioner,
the respondent and their children. Petitioner, in fact, alleges in her petition before this Court that the parties
have agreed on a four-way division of the properties—1/4 share each to the petitioner and the respondent, and
1/4 share each to their two children. Moreover, respondent’s argument that the three-way partition is in
accordance with Articles 50 and 51 of the Family Code does not hold water as said provisions relate only to
voidable marriages and exceptionally to void marriages under Article 40 of the Family Code, i.e., the
declaration of nullity of a subsequent marriage contracted by a spouse of a prior void marriage before the latter
is judicially declared void.22

In sum, we rule in favor of the petitioner. We hold that Suite 204 of LCG Condominium is a common property of
petitioner and respondent and the property regime of the parties should be divided in accordance with the law
on co-ownership.

IN VIEW WHEREOF, the petition is GRANTED. The case is hereby REMANDED to the Regional Trial Court of
Makati, Branch 149 for liquidation of the properties of petitioner and respondent in accordance with this Court’s
ruling.
G.R. No. 150707 April 14, 2004

APOLONIA LL. OCAMPO Now Substituted by MARIANO O. QUIEN, AMELITA Q. TAN, MILOVAN O.
QUIEN, LUISA OCAMPO-LLORIN, MELITA F. OCAMPO, FELIX OCAMPO JR., RAMON OCAMPO,
MIGUEL OCAMPO, JUANA OCAMPO, ANDRES OCAMPO SR., VIOLETA OCAMPO, MERCEDITA
OCAMPO, ANTONIA OCAMPO, ELISA OCAMPO, BEATRIZ OCAMPO, JUAN JOHNNY OCAMPO, JONAS
OCAMPO, MARIA DOLORES OCAMPO, REBECCA OCAMPO, FIDELA OCAMPO, LUIS OCAMPO JR. and
ERNESTO O. FORTUNO,petitioners,
vs.
FIDELA LL. OCAMPO, FELICIDAD LL. OCAMPO, BELEN OCAMPO-BARRITO, VICENTE BARRITO,
NEMESIO LL. OCAMPO, IMELDA OCAMPO and JOSE OCAMPO, respondents.

DECISION

PANGANIBAN, J.:

Basic is the rule that the party making an allegation in a civil case has the burden of proving it by a
preponderance of evidence. In an action involving property, petitioners should rely on the strength of their own
title and not on the alleged weakness of respondents’ claim.

The Case

Before this Court is a Petition for Review1 under Rule 45 of the Rules of Court, assailing the October 31, 2001
Decision2 of the Court of Appeals (CA) in CA-GR CV No. 56941. The decretal portion of the Decision reads as
follows:

"WHEREFORE, with the sole modification that the awards for damages and attorney’s fees are hereby
deleted, the judgment appealed from is, in all other respects, AFFIRMED. Without costs."3

The CA affirmed the Regional Trial Court (RTC) Decision,4 rendered on October 30, 1996, which decreed thus:

"WHEREFORE, premises considered, the Court finds, holds and declares that defendant Belen
Ocampo-Barrito, married to Vicente Barrito, are the true and lawful exclusive owners of the following
properties, namely:

(a) A parcel of residential/commercial land situated in the poblacion of Nabua, Camarines Sur,
bounded on the NE by Carmen Ocampo and Alberto Espiritu, on the SE by the Burgos Street,
on the SW by a street, and on the NW by Julian Ocampo and Carmen Ocampo, containing an
area of 1,119 square meters, more or less, presently covered by TCT No. 13654 in the name
of Belen Ocampo-Barrito, married to Vicente Barrito and previously covered by TCT No. RT-
4389(983) in the name of Fidela Ocampo, declared under TD No. 18856 and assessed at
₱17,240.00.

(b) A parcel of residential land situated at San Luis, Nabua, Camarines Sur, bounded on the
North and East by a barrio road, on the South by a creek, and on the West by Lot 237, with an
area of about 300 square meters, declared under TD No. 19639 with an assessed value of
₱6,240.00.

(c) A parcel of land situated at Sto. Domingo, Nabua, Camarines Sur, bounded on the North
by Lot 10323, on the East by Lot 9543, on the South by Lot 10325, and on the West by Lot
10322, with an area of about 4884 square meters, declared under TD No. 35122 and
assessed at ₱6780.00

as described and referred to in paragraph 9, sub-paragraphs (a), (b) and (c) of the original
complaint and it is hereby ordered that:
1. The complaint and supplemental complaint are dismissed for failure of the plaintiffs
to prove their cause/causes of action by preponderance of evidence and on the
added ground of prescription;

2. The plaintiffs are ordered to pay as their joint and several obligation, to defendants
Fidela Ll. Ocampo, Belen Ocampo-Barrito and Vicente Barrito, the total sum of
₱15,000.00 for attorney’s fees and other expenses of litigation and ₱50,000.00 for
moral damages;

3. The plaintiffs jointly and severally pay the cost of this suit.

4. Upon the finality of this decision, the notice of lis pendens annotated at plaintiffs’
behest in the Certificates of Title covering the properties in question, of defendants be
cancelled; and the plaintiffs, their agents and representatives as well as successors-
in-interest are ordered to respect the right of ownership of said defendants thereto,
and to vacate and restore the lawful possession of all portions of said properties to
herein defendants, their agents, representatives and successors-in-interest."5

The Facts

The CA adopted the RTC’s summation of facts as follows:

"Notwithstanding its somewhat deficient grammar and syntax, the following summation of the relevant
and material antecedents of the case by the court a quo, is substantially correct --

‘This is a civil suit for partition and damages filed by plaintiffs against the defendants.

‘The complaint alleges that during the lifetime of the spouses Jose Ocampo and Juana
Llander-Ocampo, they begot ten (10) children, namely: Fidela, Felix, Andres, Nemesio, Jose,
Apolonia, Felicidad, Luisa, Rosario, and Luis. Of the aforementioned children, the following
are already dead, namely: Felix, who is survived by his widow, Melita F. Ocampo and children
Felix, Jr., Ramon and Miguel; Andres, who is survived by Juana Ocampo and children Jose,
Andres, Imelda, Violeta and Mercedita; Jose, who is survived by his children Antonia, Elias
and Juan (Johnny); Rosario, who is survived by Ernesto O. Fortuno; Luis, who is survived by
his children Rose, Ricardo, Jonas, Maria Dolores, Rebecca, Fidela and Luis, Jr.; and Luisa,
who is survived by Carlos Llorin and children Mecita, Manuel, Carlos, Jr., Carmelita and
Marilou L. Arellano.

‘The complaint further alleges that during the lifetime of the spouses Jose Ocampo and Luisa
Llander-Ocampo, they acquired several parcels of land and, upon their death, left the
following properties, namely:

(a) A parcel of residential/ commercial land situated in the poblacion of Nabua,


Camarines Sur, bounded on the NE by Carmen Ocampo and Alberto Espiritu, on the
SE by the Burgos Street, on the SW by a Street, and on the NW by Julian Ocampo
and Carmen Ocampo, containing an area of 1,119 square meters, more or less,
presently covered by TCT No. RT-4389(983) in the name of Fidela Ocampo, declared
under TD No. 18856 and assessed at ₱17,240.00;

(b) A parcel of residential land situated at San Luis, Nabua, Camarines Sur, bounded
on the North and East by a barrio road, on the South by a creek, and on the West by
Lot 237, with an area of about 300 square meters, declared under TD No. 19639 with
an assessed value of ₱6,240.00; and
(c) A parcel of land situated at Sto. Domingo, Nabua, Camarines Sur, bounded on the
North by Lot 10323, on the East by Lot 9543, on the South by Lot 10325, and on the
West by Lot 10322, with an area of about 4,884 square meters, declared under TD
No. 35122 and assessed at ₱6,780.00.

‘that all the above named parcels of land are actually owned in common by the children of the
late spouses Jose Ocampo and Juana Llander Ocampo although the land denominated as
parcel (a) of the complaint is ostensibly registered in the name of Fidela Ocampo alone but
acknowledged by her as a property owned in common by all of them, brothers and sisters;
that plaintiffs desire to partition said properties but defendants Fidela Ocampo and Felicidad
unlawfully and unreasonably refuse to do so and moved by a common purpose, both of them
mortgaged to the PNB the land denominated as parcel (a) of the complaint to secure the
payment of a ₱110,000.00 loan, the proceeds of which were x x x exclusively to the benefit of
said defendants only; that the same defendants Fidela Ocampo and Felicidad Ocampo have
been receiving the fruits of the properties to the exclusion of their co-heirs amounting to not
less than ₱2,000.00 a year; and, that because of their relationship, they undertook earnest
efforts to amicably settle this controversy but because of defendants Fidela Ocampo and
Felicidad Ocampo[‘s] utterly unreasonable and unjustified actuations, the same failed.

xxx xxx xxx

‘In their complaint, plaintiffs pray that judgment be rendered ordering the partition of the
properties described in paragraph 9 of the complaint; ordering defendants Fidela Ocampo and
Felicidad Ocampo, to release or otherwise cancel any and all encumbrances on TCT No. RT-
4389(983) which they had caused to be annotated thereon, particularly, the mortgage in favor
of the PNB; requiring Fidela Ocampo and Felicidad Ocampo to refrain from further
encumbering said properties or otherwise subjecting the same to any lien and for that
purpose, a writ of preliminary injunction to be issued against them to enjoin the commission of
such acts; ordering defendants Fidela Ocampo and Felicidad Ocampo to submit an
accounting of the fruits and other produce they had received from said properties; further
ordering Fidela Ocampo and Felicidad Ocampo to indemnify plaintiffs the sum of not less than
₱15,000.00 by way of attorney’s fees and related expenses of litigation, plus the costs of the
suit; and, further granting plaintiffs such other remedies as may be just and equitable in the
premises.

xxx xxx xxx

‘On 17 December 1987, counsel for plaintiffs filed a Motion to Admit Supplemental Complaint
dated 2 December 1987 which was granted by the Court as there was no opposition to it.

‘The Supplemental Complaint alleges that defendants Helen Ocampo-Barrito and Vicente
Barrito are spouses; that on 30 September 1987, TCT No. RT-4389(983) in the name of
defendant Fidela Ocampo and covering the lot described as parcel (a) in paragraph 9 of the
original complaint was cancelled and, in lieu thereof, TCT No. 1364 was issued to defendant
Belen Ocampo-Barrito, married to defendant Vicente Barrito, on the strength of an allege[d]
Deed of Donation Inter Vivos ostensibly executed by defendant Fidela Ll. Ocampo in their
favor on 13 January 1984; that at the time the Deed of Donation Inter Vivos was presented for
registration and when TCT No. 1364, Registry of Camarines Sur, was issued to defendant
Belen Ocampo-Barrito, both the donor and donees were notoriously aware that said parcel of
land was among the lots subject of this Civil Case No. IR-1867 of which the donor Fidela Ll.
Ocampo and the mother of the donees, Felicidad Ll. Ocampo, are defendants, that said
properties were owned by the Ocampo brothers and sisters, and that the donor Fidela Ll.
Ocampo was not the exclusive owner thereof; that the transfer of defendants Fidela Ll.
Ocampo and Belen Ocampo-Barrito of the ownership over said property now subject of this
partition is tainted with fraud, actual and deliberate, to deprive plaintiffs of their legitimate
share therein, knowing as they do that the same are a co-ownership of the original parties
plaintiffs and defendants herein; that defendants Fidela Ll. Ocampo and the spouses Belen
Ocampo-Barrito and Vicente Barrito have not acted in good faith, deliberately causing
damage and injury to the plaintiffs by their avaricious desire to obtain sole ownership of said
properties through dubious and illegal means that the defendant spouses Belen Ocampo-
Barrito and Vicente Barrito, through dubious means and undue influence over Fidela Ll.
Ocampo, a very old spinster whom they have lately taken into their custody, succeeded in
having the latter execute this supposed deed of donation inter vivos; that defendants have not
acted with justice, honesty and good faith, causing injury to plaintiffs’ rights in a manner
inconsistent with morals and good customs, hence, are liable for moral damages of not less
than ₱50,000.00; and that to set an example for the public good and to deter others similarly
minded from doing so, defendants should be assessed exemplary damages of not less than
₱50,000.00.

‘Plaintiffs pray that judgment be rendered (a) declaring the Deed of Donation Inter Vivos
allegedly executed by Fidela Ll. Ocampo in favor of Belen Ocampo-Barrito and Vicente Barrito
be declare[d] null and void, (b) ordering defendants Belen Ocampo-Barrito and Vicente Barrito
to reconvey so much of the property subject thereof as pertain to the plaintiffs, (c) directing
defendants, jointly and severally, to indemnify plaintiffs such amounts as this Honorable Court
may consider fair and reasonable by way of actual, moral and exemplary damages, inclusive
of attorney’s fees and related expenses of litigation, and (d) granting plaintiffs such other
remedies as may be just and equitable in the premises.

xxx xxx xxx

‘As Special Defenses, defendant Belen Ocampo-Barrito allege that the original defendant
Fidela Ll. Ocampo, her predecessor-in-interest, since 1949 has been the absolute owner in
fee simple of the property by virtue of the issuance of the certificate of title in her name; that
her predecessor-in-interest held the same certificate of title to the same parcel of land (TCT
No. RT-4389(983) free of all encumbrances and adverse claims and was in notorious, public,
and actual possession of the property in concept of absolute owner from 1949 until 13
January 1984, when said predecessor-in-interest validly conveyed the property by donation
inter vivos which she accepted in the same public instrument; that TCT No. 1364 was issued
to defendant Belen Ocampo-Barrito on the strength of the donation inter vivos executed in her
favor by her predecessor-in-interest and has since 30 September 1987, been the absolute
owner thereof; that since 1949 none of the plaintiffs ever questioned the absolute ownership
and title of defendant Belen Ocampo-Barrito’s predecessor-in-interest over the property
making the decree of registration incontrovertible; that it is fatal for plaintiffs’ cause of action to
allege that defendants exerted ‘undue influence over Fidela Ll. Ocampo’ for the latter to
‘execute the deed of donation’ while clearly admitting in both the original and supplemental
complaints that defendants are residents of Mindoro Occidental a far away place from Nabua,
Camarines Sur, the place where the same predecessor-in-interest admittedly resides; and,
that Belen Ocampo-Barrito’s title cannot be collaterally attacked in these supposed partition
proceedings.

xxx xxx xxx

‘Defendants pray that the case be dismissed for utter lack of merit and plaintiffs be ordered to
pay defendants the sum of ₱200,000.00 for moral damages, ₱50,000.00 for exemplary
damages, ₱100,000.00 as compensatory damages, to pay attorney’s fees in the amount of
₱15,000.00, and for other just and equitable remedies.

xxx xxx xxx

‘As the Special and/or Affirmative Defenses, defendant Fidela Ll. Ocampo alleges that she is
the true and absolute owner of the real properties described in paragraph 9 of the original
complaint having acquired the same by lucrative title and has, since becoming owner thereof,
been in actual possession thereof excepting the portion of the lot described in paragraph 9 (a)
of the complaint and covered by ‘Torrens’ title which was and is still being unlawfully occupied
by plaintiffs Quiens; that the properties have been declared for assessment in defendant’s
name as exclusive owner thereof and since her acquisition of said properties, has paid the
taxes thereon; that defendant had exercised continuously all the legal incidents of ownership
on said lands to the exclusion of and adversely to the public, plaintiffs herein included; that the
[D]eed of Donation Inter Vivos and the subsequent transfer of the property mentioned in
paragraph 9 of the complaint to other defendants Belen Ocamp[o]-Barrito is valid conveyance
which binds the said property; and, that assuming that plaintiffs have a cause of action, the
same is barred by laches.

xxx xxx xxx

‘Defendant Fidela Ll. Ocampo prays that judgment be rendered dismissing the complaint and
ordering plaintiffs to indemnify such sum as will be proved as well as [s]uch amount as this
Court may assess by way of moral and exemplary damages and costs, including necessary
expenses for litigation, and for just and equitable reliefs.’"6

Ruling of the Court of Appeals

According to the appellate court, other than the Acknowledgment of Co-ownership7 executed by Respondent
Fidela Ocampo, no documentary evidence was offered to establish petitioners’ claim of co-ownership. The CA
held that this piece of documentary evidence could not prevail over the array of testimonial and documentary
evidence that had been adduced by respondents to prove their defenses. Communal ownership of the property
in question was supposedly not proven, either, by the ancient photograph showing Spouses Chino Jose and
Juana Llander Ocampo with their ten children in front of the disputed property; or by another picture showing
the name "Oniang Ocampo -- 1-15-61" engraved on the said house or building.

The court a quo rejected the argument of petitioners that the title to the subject property had been placed in the
name of Fidela, because their parents followed the Chinese custom of placing properties in the name of the
eldest son or daughter who was single. Petitioners explained that upon the death of the eldest sibling, the
properties would revert to the younger brothers and sisters. According to the CA, however, not a shred of
evidence was adduced to prove that such a Chinese custom existed or was observed in that place.

The CA also dismissed petitioners’ contention that common ownership was indicated by the fact that some of
the children of Spouses Ocampo stayed and lived on the subject property. It ruled that fraternal affection could
have been the motive that impelled respondents to allow their relatives to use it.

In contrast to the arguments of petitioners, the CA said that respondents were able to give clear proof of their
ownership of the property: the Transfer Certificate of Title and the corresponding Tax Declaration in the name
of Fidela, and later of Belen Ocampo-Barrito.

Nevertheless, the CA eliminated the awards for damages and attorney’s fees, because the trial court had failed
to cite the factual, the legal and the equitable bases therefor.

Hence, this Petition.8

The Issues

Petitioners raise the following issues for our consideration:

"1. Where the evidence presented, oral and documentary, on the question of co-ownership, is
overwhelming as it is unopposed, unrebutted and unimpeached, has co-ownership been proved?

"2. Where co-ownership is confirmed by long, public possession by co-owners, did the courts commit
grave abuse of discretion in holding that there is no co-ownership?
"3. Where the evidence of respondents is weak, puerile and inconsistent, did the courts commit a
grave misapprehension of facts when they gave credence to it?

"4. Where a deed of donation intervivos entered in bad faith deprives the heirs of their hereditary
shares, is said deed valid?

"5. Where a declaration against interest has not been opposed, assailed, rebutted or impeached, did
the courts commit grave abuse of discretion in holding there is no such declaration?" 9

At bottom, the question to be resolved in this case is who owns the disputed property?

The Court's Ruling

The Petition has no merit.

Main Issue:

Ownership of the Subject Property

At the outset, we clarify that although there were three (3) properties originally involved in the litigation brought
before the RTC, petitioners’ appeal dealt only with the first one, referred to in the Statement of Facts above -- a
parcel of residential/commercial land situated in the poblacion of Nabua, Camarines Sur. In their CA appeal,
petitioners declared that "the focus of this case is on the first [property] which is located at downtown Poblacion
of Nabua and therefore a valuable piece of property, 1,119 square meters in all."10 Because petitioners had not
questioned the RTC Decision with regard to the other properties, then the adjudication of these matters
became final. Thus, only one property is left for resolution in the present proceedings.11

Since the original Complaint was an action for partition, this Court cannot order a division of the property,
unless it first makes a determination as to the existence of a co-ownership.12 The settlement of the issue of
ownership is the first stage in an action for partition.13 This action will not lie if the claimant has no rightful
interest in the subject property. Parties filing the action are in fact required by the Rules of Court14 to set forth in
their complaint the nature and the extent of their title to the property. It would be premature to effect a partition
thereof until and unless the question of ownership is first definitely resolved. 15

Basic is the rule that the party making an allegation in a civil case has the burden of proving it by a
preponderance of evidence.16 Petitioners’ chief evidence of co-ownership of the property in question is simply
the Acknowledgement of Co-ownership executed by Fidela. As mentioned earlier, both the trial and the
appellate courts were correct in finding that this piece of documentary evidence could not prevail over the array
of testimonial and documentary evidence that were adduced by respondents, as will be expounded below.

Petitioners failed to trace the successive transfers of ownership of the questioned property that eventually led
to them. Allegedly, it was originally owned by their parents -- Spouses Ocampo -- whose deaths passed it on to
the children. Petitioners, however, presented absolutely no proof of ownership of their predecessors-in-interest.
In insisting that it was so transferred and thus co-owned, the former rely on the Acknowledgement of Co-
ownership executed by Fidela, their eldest sibling.

On the other hand, Belen clearly traced the basis of her alleged sole ownership of the property and presented
preponderant proof of her claim.

First, she presented a Deed of Absolute Sale of Residential Land,17 referring to the subject property, executed
between Adolfo Ocampo as seller and Felix Ocampo as buyer. The document dated July 6, 1948, was signed
in the presence of two witnesses and acknowledged before Juan B. Ballecer, a notary public.

The theory of petitioners is completely demolished by this document, which they never contested. According to
them, the land in question was the conjugal property of their parents; and that upon the latter’s deaths, the
former inherited it in common. If indeed the land was the conjugal property of Spouses Ocampo, then
petitioners should have presented evidence to prove such ownership by their alleged predecessors-in-interest.
Since the former failed to do so, how then can they prove the transfer to them of ownership that has not been
established in the first place? It is axiomatic that no one can transfer to another a right greater than that which
one has;18 thus, the legal truism that the spring cannot rise higher than its source.19

Likewise, in this Deed of Absolute Sale, Adolfo Ocampo declared his "exclusive ownership" of the property,
"having been acquired by purchase[;] and [having] been in [his] continuous, public, peaceful, adverse and
material possession for more than 50 years together with [his] predecessors in rights and interest, in [the]
concept of owner without any claim of other persons."20

Second, Respondent Belen proved that on February 10, 1953, this property had been sold to Fidela by Felix
Ocampo for a valuable consideration; and that Fidela had entered the property, actually occupied it, and
exercised all powers of dominion over it to the exclusion of petitioners.

As proofs of ownership of the property by Fidela, Belen presented Transfer Certificate of Title No. RT-4389
(983),21which named the former as owner in fee simple; and a Declaration of Real Property,22 evidencing
payment of real property taxes, also by Fidela as owner.

To prove further that Fidela had exercised dominion over the property, Belen also presented a Real Estate
Mortgage23 executed by the former as absolute owner. Fidela had executed it in favor of her sister Apolonia
Ocampo, one of the original petitioners in this case, who is now represented by her heirs. Belen correctly
argues that in agreeing to be a mortgagee, Apolonia admitted and recognized Fidela as the true owner of the
land in question.

The Civil Code provides that an essential requisite of a contract of mortgage is that the mortgagor be the
absolute owner of the thing mortgaged.24 Co-ownership cannot be presumed even if only a portion of the
property was mortgaged to Apolonia, because a co-owner may dispose only of one’s interest in
the ideal or abstract part of the undivided thing co-owned with others.25 The effect of a mortgage by a co-owner
shall be limited to the portion that may be allotted to that person upon the termination of the co-ownership.26 In
this case, Fidela mortgaged a definiteportion of the property and thus negated any acknowledgement of co-
ownership.

Third, Belen then presented a Deed of Donation Inter Vivos27 executed on January 13, 1984, between herself
as donee and Fidela as donor. This act shows the immediate source of the former’s claim of sole ownership of
the property.

A donation as a mode of acquiring ownership results in an effective transfer of title to the property from the
donor to the donee.28 Petitioners stubbornly rely on the Acknowledgement of Co-ownership allegedly executed
by Fidela in favor of her siblings. What they overlook is the fact that at the time of the execution of the
Acknowledgement -- assuming that its authenticity and due execution were proven -- the property had already
been donated to Belen. The Deed of Donation, which is the prior document, is clearly inconsistent with the
document relied upon by petitioners. We agree with the RTC’s ratiocination:

"On the claim of plaintiffs that defendant Fidela Ll. Ocampo herself made a written acknowledgement
for her co-ownership over all the properties disputed with plaintiffs in this case, the same cannot be
considered as a declaration against Fidela’s interest since the alleged acknowledgement was written
and executed on 24 December 1985 when she was no longer the owner of the property as the year
previous, on 13 January 1984, she had already donated all her properties to defendant Belen
Ocampo-Barrito, so that, in effect, she had no more properties with which she can have an interest to
declare against."29

Petitioners argue that the Acknowledgement of Co-ownership may be considered as a declaration against
interest. A statement may be admissible as such a declaration if it complies with the following requisites: 1) the
declarant is dead or unable to testify; 2) it relates to a fact against the interest of the declarant; 3) at the time of
the declaration, the declarant was aware that it was contrary to his or her interest; and 4) the declarant had no
motive to falsify and believed the declaration to be true.30

As correctly found by the trial court, however, the Acknowledgement of Co-ownership could not be a fact
against the interest of the declarant, since her right over the property had already been extinguished by the
prior act of donation. Thus, at the time of the declaration, Fidela could not have acknowledged co-ownership,
as she had no more property against which she had an interest to declare.

Finally, Belen presented Transfer Certificate of Title No. 1365431 as proof of her ownership of the property. To
be sure, the best proof of ownership of the land is the Certificate of Title (TCT). Hence, more than a bare
allegation is required to defeat the face value of respondent’s TCT, which enjoys a legal presumption of
regularity of issuance.32It is quite surprising that despite the process of transfers and titling of the subject
property -- commencing in 1948 and eventually leading to the sole ownership of Belen in 1984 33 -- it was only
after 1984 that petitioners started asserting their claim of co-ownership thereof.

We are not unmindful of our ruling that the mere issuance of a certificate of title does not foreclose the
possibility that the real property may be under co-ownership with persons not named therein.34 But given the
circumstances of this case, the claim of co-ownership by petitioners has no leg to stand on. Again, we stress,
Belen clearly traced the source of her sole ownership of the property in question and thereby foreclosed the
unproven and unsubstantiated allegation of co-ownership thereof.

In addition to the TCT presented, Belen offered as evidence the Tax Declaration35 indicating that she, as owner,
had been paying real estate taxes on the property, all to the exclusion of petitioners.

On the other hand, petitioners could not show any title, tax receipt or document to prove their ownership.
Having filed an action involving property, they should have relied on the strength of their own title and not on
the alleged weakness of respondents’ claim.36

Petitioners assert that their claim of co-ownership of the property was sufficiently proved by their witnesses --
Luisa Ocampo-Llorin and Melita Ocampo. We disagree. Their testimonies cannot prevail over the array of
documents presented by Belen. A claim of ownership cannot be based simply on the testimonies of witnesses;
much less on those of interested parties, self-serving as they are.

As to the photographs presented by petitioners to bolster their claim of co-ownership, we affirm the CA’s
disposition showing the flimsiness of their claim as follows:

"The other piece of documentary evidence presented by appellants really proved nothing. The ancient
photograph showing the spouses Chino Jose and Juana Llander Ocampo together with their ten
children, simply proved that there was such a picture taking of the spouses with their children. But the
photograph does not prove communal ownership by appellants over the disputed parcels of land;
neither does it prove that the said properties were indeed owned by the spouses Chino Jose and
Juana Ocampo, and then later on transferred to and commonly owned by their children. By the same
token, the picture exhibited by appellant showing the name ‘Oniang Ocampo -- 1-15-61’ (or Apolonia
Ocampo, one of the children of the spouses Chino Jose and Juana) engraved in the house or building,
does not prove communal ownership of the properties in question. At best, it is susceptible of various
meanings, like: that of Oniang Ocampo was born on 1-15-61, or that she got married on that date, or
that she was celebrating a special event on the date mentioned, or that she even died on the date
mentioned. And even assuming ex gratia argumenti, that the said engraving proved ownership over
the disputed building, some such fact can only work to the prejudice of herein appellants. Why?
Because it would mean that only Oniang (or Apolonia) was the owner of the building and that the
building is not, therefore, a communal property of the children of the late spouses Chino Jose and
Juana. Adverting to this piece of evidence, the Trial Court postulated --

‘The engravings on the house ‘ONIANG OCAMPO BLDG. -- 1-15-61 cannot serve as
evidence that the property is of common ownership. At most, this can only establish the fact
that said building was constructed for a certain ‘Oniang’ on 15 January 1961. If, indeed, the
property is of common ownership, there could not have been any difficulty to engrave thereon
‘HEIRS OF JOSE OCAMPO and JUANA LLANDER-OCAMPO -- 1-15-61’ instead of ‘ONIANG
OCAMPO BLDG. -- 1-15-61.’"37

Neither can we accept petitioners’ contention that co-ownership is shown by the fact that some of the children
of Spouses Ocampo stayed, lived, and even put up businesses on the property. The appellate court correctly
found that since the litigants in this case were blood relatives, fraternal affection could have been a good
motive that impelled either Belen or Fidela to allow petitioners to use the property. Without any proof, however,
co-ownership among the parties cannot be presumed.

Neither are we persuaded by the contention that Spouses Ocampo placed the subject property in the name of
only one person in accordance with a Chinese custom. As mentioned earlier, that custom consisted of placing
properties of parents in the name of the eldest unmarried son or daughter, with the implicit understanding that
ownership thereof would later revert to the siblings.

In contrast to the failure of petitioners to prove that such custom existed and was practiced in that
place,38 Belen presented evidence that clearly negated any claim of ownership by the former’s predecessors-in-
interest. Having shown that the property in question was originally owned by one Adolfo Ocampo -- not by
Spouses Ocampo, from whom petitioners derive their right -- the claim of custom becomes immaterial.

The fact that Fidela was not presented in court will not necessarily favor petitioners and prove that the property
in question is indeed co-owned. If they felt that her testimony would prove their cause, then they could have
easily called her as an adverse or a hostile witness.39 But since respondents were confident in the documents
they presented in court, they did not see any need to call her as a witness.

Petitioners also question the motives of Fidela for donating her properties, when she is still alive and needs
money in her old age. They clearly overlook the nature of a donation.

Donation is an act of liberality whereby a person gratuitously disposes of a thing or a right in favor of another
who accepts it.40 Once perfected, a donation is final; its revocation or rescission cannot be effected, absent any
legal ground therefor.41 A donation may in fact comprehend the entire property of the donor.42 At any rate, the
law provides that donors should reserve, in full ownership or in usufruct, sufficient means for their own support
and that of all their relatives who, at the time of the acceptance of the donation, are by law entitled to be
supported by them.43

In questioning the motives of Fidela for donating the subject property, petitioners are contradicting even
themselves. On the one hand, they assert that she would not have disposed of her property, since she would
need it in her old age; on the other, they argue that it was not hers alone anyway. It should be clear that the law
protects donors by providing that, without any reservation of sufficient means for themselves, the donation shall
be reduced upon the petition of any person affected.44

To be sure, petitioners’ arguments all pertain to circumstances extraneous to the Deed of Donation itself. The
law is clear that when its terms have been reduced to writing, an agreement must be presumed to contain all
the terms agreed upon; and there can be, between the parties and their successors in interest, no evidence of
such terms other than the contents of the written agreement.45

Petitioners did not question the consent of Fidela to the donation. Never was there any intimation that she had
either been coerced or defrauded into entering into it. As all the essential elements of a donation -- consent,
subject matter and cause46 -- have been satisfied, we see no reason to entertain any doubt about the Deed
pertaining thereto.

The question of why the land was registered several years after the donation is purely speculative. What is
important is that there was a duly proven Deed of Donation, which formed the basis of Belen’s claim and led to
the registration of the property in her name.
Petitioners also question Fidela’s filing of an unlawful detainer suit after the date of the Deed of Donation.
Again, we remind petitioners that because this action involves property, they should rely on the strength of their
own title, not on the alleged weakness of the claim of respondents. At any rate, the burden of proof of the claim
of co-ownership rests on the former.

Moreover, the final resolution of this case entails the review of factual findings of the courts below. It is a settled
doctrine that in a civil case, final and conclusive are the factual findings of the trial court, if supported by clear
and convincing evidence on record. Usually, the Supreme Court does not review those findings -- especially
when affirmed by the Court of Appeals, as in this case.47 From the records of the present case, no cogent
evidence appears that would impel us to apply the above doctrine differently. The courts below have not
overlooked essential facts that, if considered, may produce a different outcome. The trial court correctly
explained thus:

"This Court from the outset had the opportunity to see and hear the tell-tale [signs] of truthfulness or
perjury – like the flush of face, or the tone of voice, or the dart of eyes, or the fearful pause [--] and
finds that credibility is with the defendants [herein respondents]. Moreover, the preponderance of
evidence is with defendants whose testimonial evidences are buttressed by their documentary
evidences."48

Finally, we agree with the CA in eliminating the awards for damages and attorney’s fees for respondents’ failure
to show any factual, legal or equitable bases therefor.49

WHEREFORE, the Petition is hereby DENIED, and the assailed Decision AFFIRMED. Costs against
petitioners.
G.R. No. 152766 June 20, 2003

LILIA SANCHEZ, Petitioner,


vs.
COURT OF APPEALS, HON. VICTORINO S. ALVARO as Presiding Judge, RTC-Br. 120, Caloocan City,
and VIRGINIA TERIA, Respondents.

DECISION

BELLOSILLO, J.:

This is a Special Civil Action for Certiorari under Rule 65 of the Rules of Court to annul and set aside the
Decision of the Court of Appeals dated 23 May 2001 as well as its Resolution dated 8 January 2002 in CA-G.R.
SP No. 59182.

Lilia Sanchez, petitioner, constructed a house on a 76-square meter lot owned by her parents-in-law. The lot
was registered under TCT No. 263624 with the following co-owners: Eliseo Sanchez married to Celia Sanchez,
Marilyn Sanchez married to Nicanor Montalban, Lilian Sanchez, widow, Nenita Sanchez, single, Susana
Sanchez married to Fernando Ramos, and Felipe Sanchez.1 On 20 February 1995, the lot was registered under
TCT No. 289216 in the name of private respondent Virginia Teria by virtue of a Deed of Absolute Sale
supposed to have been executed on 23 June 19952 by all six (6) co-owners in her favor.3 Petitioner claimed that
she did not affix her signature on the document and subsequently refused to vacate the lot, thus prompting
private respondent Virginia Teria to file an action for recovery of possession of the aforesaid lot with the
Metropolitan Trial Court (MeTC) of Caloocan City sometime in September 1995, subsequently raffled to Br. 49
of that court.

On 12 February 1998, the MeTC-Br. 49 of Caloocan City ruled in favor of private respondent declaring that the
sale was valid only to the extent of 5/6 of the lot and the other 1/6 remaining as the property of petitioner, on
account of her signature in the Deed of Absolute Sale having been established as a forgery.

Petitioner then elevated her appeal to the Regional Trial Court of Caloocan City, subsequently assigned to Br.
120, which ordered the parties to file their respective memoranda of appeal. Counsel for petitioner did not
comply with this order, nor even inform her of the developments in her case. Petitioner not having filed any
pleading with the RTC of Caloocan City, the trial court affirmed the 27 July 1998 decision of the MeTC.

On 4 November 1998, the MeTC issued an order for the issuance of a writ of execution in favor of private
respondent Virginia Teria, buyer of the property. On 4 November 1999 or a year later, a Notice to Vacate was
served by the sheriff upon petitioner who however refused to heed the Notice.

On 28 April 1999 private respondent started demolishing petitioner’s house without any special permit of
demolition from the court.

Due to the demolition of her house which continued until 24 May 1999 petitioner was forced to inhabit the
portion of the premises that used to serve as the house’s toilet and laundry area.

On 29 October 1999 petitioner filed her Petition for Relief from Judgment with the RTC on the ground that she
was not bound by the inaction of her counsel who failed to submit petitioner’s appeal memorandum. However
the RTC denied the Petition and the subsequent Motion for Reconsideration.

On 14 June 2000 petitioner filed her Petition for Certiorari with the Court of Appeals alleging grave abuse of
discretion on the part of the court a quo.

On 23 May 2001 the appellate court dismissed the petition for lack of merit. On 18 June 2001 petitioner filed a
1âw phi1

Motion for Reconsideration but the Court of Appeals denied the motion in its Resolution of 8 January 2002.
The only issue in this case is whether the Court of Appeals committed grave abuse of discretion in dismissing
the challenged case before it.

As a matter of policy, the original jurisdiction of this Court to issue the so-called extraordinary writs should
generally be exercised relative to actions or proceedings before the Court of Appeals or before constitutional or
other tribunals or agencies the acts of which for some reason or other are not controllable by the Court of
Appeals. Where the issuance of the extraordinary writ is also within the competence of the Court of Appeals or
the Regional Trial Court, it is either of these courts that the specific action for the procurement of the writ must
be presented. However, this Court must be convinced thoroughly that two (2) grounds exist before it gives due
course to a certiorari petition under Rule 65: (a) The tribunal, board or officer exercising judicial or quasi-judicial
functions has acted without or in excess of its or his jurisdiction; and (b) There is no appeal nor any plain,
speedy and adequate remedy in the ordinary course of law.

Despite the procedural lapses present in this case, we are giving due course to this petition as there are
matters that require immediate resolution on the merits to effect substantial justice.

The Rules of Court should be liberally construed in order to promote their object of securing a just, speedy and
inexpensive disposition of every action or proceeding.4

The rules of procedure should be viewed as mere tools designed to aid the courts in the speedy, just and
inexpensive determination of the cases before them. Liberal construction of the rules and the pleadings is the
controlling principle to effect substantial justice.5 Litigations should, as much as possible, be decided on their
merits and not on mere technicalities.6

Verily, the negligence of petitioner’s counsel cannot be deemed as negligence of petitioner herself in the case
at bar. A notice to a lawyer who appears to have been unconscionably irresponsible cannot be considered as
notice to his client.7 Under the peculiar circumstances of this case, it appears from the records that counsel was
negligent in not adequately protecting his client’s interest, which necessarily calls for a liberal construction of
the Rules.

The rationale for this approach is explained in Ginete v. Court of Appeals - 8

This Court may suspend its own rules or exempt a particular case from its operation where the appellate court
failed to obtain jurisdiction over the case owing to appellant’s failure to perfect an appeal. Hence, with more
reason would this Court suspend its own rules in cases where the appellate court has already obtained
jurisdiction over the appealed case. This prerogative to relax procedural rules of the most mandatory character
in terms of compliance, such as the period to appeal has been invoked and granted in a considerable number
of cases x x x x

Let it be emphasized that the rules of procedure should be viewed as mere tools designed to facilitate the
attainment of justice. Their strict and rigid application, which would result in technicalities that tend to frustrate
rather than promote substantial justice, must always be eschewed. Even the Rules of Court reflect this
principle. The power to suspend or even disregard rules can be so pervasive and compelling as to alter even
that which this Court itself has already declared to be final, as we are now constrained to do in the instant case
xxxx

The emerging trend in the rulings of this Court is to afford every party litigant the amplest opportunity for the
proper and just determination of his cause, free from the constraints of technicalities. Time and again, this
Court has consistently held that rules must not be applied rigidly so as not to override substantial justice.

Aside from matters of life, liberty, honor or property which would warrant the suspension of the Rules of the
most mandatory character and an examination and review by the appellate court of the lower court’s findings of
fact, the other elements that should be considered are the following: (a) the existence of special or compelling
circumstances, (b) the merits of the case, (c) a cause not entirely attributable to the fault or negligence of the
party favored by the suspension of the rules, (d) a lack of any showing that the review sought is merely
frivolous and dilatory, and (e) the other party will not be unjustly prejudiced thereby.9
The suspension of the Rules is warranted in this case since the procedural infirmity was not entirely attributable
to the fault or negligence of petitioner. Besides, substantial justice requires that we go into the merits of the
case to resolve the present controversy that was brought about by the absence of any partition agreement
among the parties who were co-owners of the subject lot in question. Hence, giving due course to the instant
petition shall put an end to the dispute on the property held in common.

In People’s Homesite and Housing Corporation v. Tiongco10 we held:

There should be no dispute regarding the doctrine that normally notice to counsel is notice to parties, and that
such doctrine has beneficent effects upon the prompt dispensation of justice. Its application to a given case,
however, should be looked into and adopted, according to the surrounding circumstances; otherwise, in the
court’s desire to make a short-cut of the proceedings, it might foster, wittingly or unwittingly, dangerous
collusions to the detriment of justice. It would then be easy for one lawyer to sell one’s rights down the river, by
just alleging that he just forgot every process of the court affecting his clients, because he was so busy. Under
this circumstance, one should not insist that a notice to such irresponsible lawyer is also a notice to his clients.

Thus, we now look into the merits of the petition.

This case overlooks a basic yet significant principle of civil law: co-ownership. Throughout the proceedings
from the MeTC to the Court of Appeals, the notion of co-ownership11 was not sufficiently dealt with. We attempt
to address this controversy in the interest of substantial justice. Certiorari should therefore be granted to cure
this grave abuse of discretion.

Sanchez Roman defines co-ownership as "the right of common dominion which two or more persons have in a
spiritual part of a thing, not materially or physically divided.12 Manresa defines it as the "manifestation of the
private right of ownership, which instead of being exercised by the owner in an exclusive manner over the
things subject to it, is exercised by two or more owners and the undivided thing or right to which it refers is one
and the same."13

The characteristics of co-ownership are: (a) plurality of subjects, who are the co-owners, (b) unity of or material
indivision, which means that there is a single object which is not materially divided, and which is the element
which binds the subjects, and, (c) the recognition of ideal shares, which determines the rights and obligations of
the co-owners.14

In co-ownership, the relationship of such co-owner to the other co-owners is fiduciary in character and attribute.
Whether established by law or by agreement of the co-owners, the property or thing held pro-indiviso is
impressed with a fiducial nature so that each co-owner becomes a trustee for the benefit of his co-owners and
he may not do any act prejudicial to the interest of his co-owners.15

Thus, the legal effect of an agreement to preserve the properties in co-ownership is to create an express trust
among the heirs as co-owners of the properties. Co-ownership is a form of trust and every co-owner is a
trustee for the others.16

Before the partition of a land or thing held in common, no individual or co-owner can claim title to any definite
portion thereof. All that the co-owner has is an ideal or abstract quota or proportionate share in the entire land
or thing.17

Article 493 of the Civil Code gives the owner of an undivided interest in the property the right to freely sell and
dispose of it, i.e., his undivided interest. He may validly lease his undivided interest to a third party
independently of the other co-owners.18 But he has no right to sell or alienate a concrete, specific or determinate
part of the thing owned in common because his right over the thing is represented by a quota or ideal portion
without any physical adjudication.19

Although assigned an aliquot but abstract part of the property, the metes and bounds of petitioner’s lot has not
been designated. As she was not a party to the Deed of Absolute Sale voluntarily entered into by the other co-
owners, her right to 1/6 of the property must be respected. Partition needs to be effected to protect her right to
her definite share and determine the boundaries of her property. Such partition must be done without prejudice
to the rights of private respondent Virginia Teria as buyer of the 5/6 portion of the lot under dispute.

WHEREFORE, the Petition is GRANTED. The Decision of the Court of Appeals dated 23 May 2001 as well as
its Resolution dated 8 January 2002 in CA-G.R. SP No. 59182 is ANNULLED and SET ASIDE. A survey of the
questioned lot with TCT No. 289216 (formerly TCT No. 263624) by a duly licensed geodetic engineer and the
PARTITION of the aforesaid lot are ORDERED.

Let the records of this case be REMANDED to MeTC-Br. 49, Caloocan City to effect the aforementioned survey
and partition, as well as segregate the 1/6 portion appertaining to petitioner Lilia Sanchez.

The Deed of Absolute Sale by the other co-owners to Virginia Teria shall be RESPECTED insofar as the other
undivided 5/6 portion of the property is concerned.
G.R. No. 169356 August 28, 2007

CARMEN FANGONIL - HERRERA, Petitioner,


vs.
TOMAS FANGONIL, PURA FANGONIL TINO, MARINA FANGONIL, MARIANO FANGONIL, MILAGROS
FANGONIL-LAYUG and VICTORIA FANGONIL ESTOQUE,1 Respondents.

DECISION

CHICO-NAZARIO, J.:

In this instant Petition for Review under Rule 45 of the Revised Rules of Court, petitioner assails the (a)
Decision issued by the Court of Appeals dated 30 January 2004 in CA-G.R. CV No. 61990, and (b) the
Resolution of the same Court dated 15 July 2005 denying petitioner’s Motion for Reconsideration. Petitioner
urges this Court to modify the assailed Decision of the Court of Appeals which affirmed the Decision dated 9
October 1998 of the Regional Trial Court (RTC) of Agoo, La Union, Branch 31 in Special Proceedings Case
No. A-806 for Judicial Partition. The petition prays that the two parcels of land, one located in Magsaysay,
Tubao, La Union, more particularly described as:

A parcel of rice land which the middle portion (15,364 sq. m) has been included and situated in Barrio Lloren,
Tubao, La Union, declared under Tax Dec. Number 2889. Bounded on the North, by the property of Manuel
Ordoña; on the East, by the property of Severino Padilla, Nicolas Caniero, and Heirs of V. Selga; on the South,
by the properties of Manuel Ordoña and Francisco Padilla; and on the West, by a river; containing an area of
more than two hectares; x x x.2

and the other in San Nicholas East, Agoo, La Union, designated as:

A parcel of unirrigated rice land without permanent improvements, situated in Barrio San Nicolas, Agoo, La
Union with an area of 10,777 sq. m. (1 Ha. 1,777 sq. m.) more or less, visible by signs of pilapiles around its
perimeter, assessed at ₱400.00, declared for tax purposes in my name under Tax Declaration Number 6373,
and bounded-on the North, by Donato Eslao; on the East, by the Heirs of Flaviano Fangonil, and others; on the
South, by Eulalio Fangonil; and on the West, by the heirs of Remgio Boado; x x x.3

be adjudged solely to petitioner to the exclusion of respondents. In addition, petitioner requests that another
parcel of land located in Poblacion, Tubao, La Union, be divided in accordance with the manner she proposes.

The following are the antecedent facts:

Petitioner and respondents4 are children of the late Fabian Fangonil and Maria Lloren Fangonil5 of Tubao, La
Union. The Fangonil spouses had 7 children: Tomas, Pura, Marina, Mariano, Milagros, Sinforoso, and Carmen.
Fabian died on 1 June 1953, while Maria Lloren died on February 1976. The spouses died intestate, leaving an
estate consisting of 7 parcels of land herein specified:

Parcel 1 – a 1,800 square meter residential land located at Poblacion, Tubao, La Union, which is facing the
Town Plaza;

Parcel 2 – a 922 square meter residential lot located at Barangay Sta. Barbara, Agoo, La Union;

Parcel 3 – a 54,759 square meter agricultural land located at Francia West, Tubao, La Union;

Parcel 4 – an 84,737 square meter agricultural land located at Francia West, Tubao, La Union;

Parcel 5 – a 5,821 square meter parcel of agricultural land located at Francia Sur, Tubao, La Union;
Parcel 6 – a 17,958 square meter parcel of agricultural land located at Magsaysay, Tubao, La Union;

Parcel 7 – 9,127 square meter parcel of agricultural land located at San Nicolas East, Agoo, La Union.

The only remaining heirs are the 7 children. Prior to an extrajudicial settlement executed by the heirs in 1983,
there was never any settlement of the estate. The parties do not dispute that the succeeding transactions
involving parcels 6 and 7 took place. Fabian Fangonil, with the consent of Maria Lloren Fangonil, obtained a
loan secured by a mortgage over a 15,364 square meter middle portion of the sixth parcel of land for
₱1,450.00, executed under a Deed of Mortgage6 in favor of Francisca Saguitan on 20 April 1949. A portion of
the sixth parcel, with an area of 4,375 square meters, was sold with a right to repurchase to a certain
Constantino Oribello for ₱1,450.00 on 15 December 1953. The transaction was under an agreement
designated as a Deed of Pacto de Retro Sale7 between Maria Lloren Fangonil, who was a widow by then, and
Constantino Oribello. On the other hand, the seventh parcel of land was sold, with a right to repurchase, by
Fabian Fangonil to Quirino Estacio under an agreement denominated as Deed of Sale with Pacto de Retro8 on
12 December 1949 for ₱2,600.00. The total amount received by the Fangonil spouses for the properties was
₱5,500.00.

The parcels above-mentioned were never repurchased or redeemed by the Fangonil spouses. Prior to
foreclosure, the portion of the sixth parcel covered by a Deed of Mortgage was released from the mortgage on
20 April 1956 upon petitioner’s payment of ₱1,950.00 to Francisca Suguitan. The portion of the sixth parcel
covered by the Deed of Pacto de Retro Sale was repurchased on 16 October 1956 upon petitioner’s payment
of ₱1,550.00 to Constantino Oribello. On the other hand, the seventh parcel subject of the Deed of Sale with
Pacto de Retro was repurchased by petitioner on 13 November 1959 upon the payment of ₱2,600.00 to
Quirino Estacio. Petitioner paid the total amount of ₱6,100.00 for the redemption of parcels 6 and 7.

On 14 November 1983, the parties executed an Extrajudicial Settlement and Partial Partition of the estate of
the Fangonil spouses covering the seven parcels of land. Although petitioner signed the extrajudicial
settlement, she refused to accede to the proposed manner of partition of parcel 1. Thereafter, all the heirs
concerned, except petitioner, executed a joint affidavit dated 19 December 1994, stipulating on the partition of
parcel 1. On 2 February 1995 or 11 years after the execution of the extrajudicial settlement, petitioner executed
an affidavit9 refuting the portions pertaining to parcels 6 and 7, on the ground that her late brother Sinforoso
Fangonil who was a Regional Trial Court (RTC) Judge then, committed misrepresentation and convinced her to
sign the said settlement.

On 1 March 1995, six of the seven children of the Fangonil spouses, excluding herein petitioner, filed
with the RTC a petition for judicial partition of the seven parcels of land, with prayer for appointment of
Marina Fangonil as administratrix. The case was docketed as Special Proceedings Case No. A-806.
Petitioner intervened before the trial court to oppose the petition. She likewise prayed that she be
appointed administratrix, claiming exclusive ownership over parcels 6 and 7.

The parties agreed to submit the case for decision based on the pleadings, considering there was no
disagreement as to the manner of sharing Parcels 2, 3, 4, and 5 of the estate. In addition, on 16
September 1996, the respondent heirs deposited in court ₱7,453.0010 as payment to petitioner and her
brother Tomas Fangonil as the only outstanding debtors of the estate as specified in the 14 November
1983 extrajudicial settlement. On 2 September 1998, respondents, through counsel, submitted a
Manifestation/Motion dated 31 August 1998, proposing a manner of computation for repayment to
petitioner, the pertinent portions of which read:

3. That the currency rate of the Philippine Peso to the U.S. Dollar on November 13, 1959 is ₱3.90 to
U.S. $1.00;

4. That the currency rate of the Philippine Peso to the U.S. Dollar as of this date August 31, 1998 is
₱42.00 to U.S. $1.00;

5. So that the amount of indebtedness of ₱6,100.00 on November 13, 1959 has now the equivalent of
₱65,790.00 as of 31 August 1998;
5.1 The equivalent amount of ₱65,790.00 shall be proportionately paid by all the heirs with each and
every heir having a share in said indebtedness in the amount of ₱9,398.57;11

On 7 October 1998, the RTC issued an Order generally approving the manifestation/motion except for the
computation, modifying the amount to ₱138,100.00 as the present equivalent of the amount of ₱6,100.00
previously paid by petitioner to redeem parcels 6 and 7. In its Decision12 dated 9 October 1998, the RTC ruled
in favor of respondents herein and declared parcels 6 and 7 as part of the estate of the spouses Fangonil to be
partitioned and ordered the partition of parcel 1 based on the manner proposed by respondents. It ordered the
payment of the estate debt to petitioner and her brother in the amount of ₱138,100.00, the money equivalent of
the ₱6,100.00 paid by her at the time of redemption of parcels 6 and 7. The dispositive portion of the decision
reads:

WHEREFORE, upon the foregoing premises, this court hereby adjudicates and partitions the inherited
properties, including the controversial parcels 6 and 7, in accordance with the following:

FIRST PARCEL

xxxx

This is divided into two (2) segments, the Eastern Portion and Western Portion.

The Eastern Portion shall belong to three (3) heirs, namely Tomas Fangonil, Sinforoso Fangonil represented by
Victoria Estoque and Marina Fangonil. The Western Portion shall belong to two (2) heirs, the Southwestern part
belongs to Pura F. Tino and the Northwestern part belongs to Carmen Fangonil Herrera x x x.

SECOND PARCEL

xxxx

This parcel goes to Mariano Fangonil and Milagros Fangonil Layug.

THIRD PARCEL

xxxx

A drawing of lots was conducted on April 25, 1997 with respect to parcel 3. Parcel 3 was divided into seven by
Geodetic Engineer Gerardo Dacayanan. The result was the following (see also, Order dated April 25, 1997,
page 166, Record of the case):

Lot 1 (A) – Milagros F. Layug

Lot 2 (B) – Tomas Fangonil

Lot 3 (C) – Mariano Fangonil

Lot 4 (D) – Pura F. Tino

Lot 5 (E) – Sinforoso Fangonil

Lot 6 (F) – Carmen F. Herrera

Lot 7 (G) – Marina Fangonil


xxxx

FOURTH PARCEL

xxxx

The same thing happened. There was a drawing of lots. The result was the following:

Lot 1 (A) – Marina Fangonil

Lot 2 (B) – Carmen F. Herrera

Lot 3 (C) – Tomas Fangonil

Lot 4 (D) – Sinforoso Fangonil

Lot 5 (E) – Milagros F. Layug

Lot 6 (F) – Pura F. Tino

Lot 7 (G) – Mariano Fangonil

xxxx

FIFTH PARCEL

xxxx

On May 2, 1997, the drawing of lots on Parcel 5 was conducted. The result was as follows:

Lot 1 – Pura F. Tino

Lot 2 – Marina Fangonil

Lot 3 – Milagros F. Layug

Lot 4 – Sinforoso Fangonil

Lot 5 – Carmen F. Herrera

Lot 6 – Mariano Fangonil

Lot 7 – Tomas Fangonil

SIXTH PARCEL

xxxx

On August 27, 1998, the drawing of lots was conducted with respect to the controversial parcels, the sixth
parcel and the seventh parcel. The result on the sixth parcel was as follows:

Lot 1 – Pura F. Tino


Lot 2 – Sinforoso Fangonil

Lot 3 – Tomas Fangonil

Lot 4 – Marina Fangonil

Lot 5 – Carmen F. Herrera (boycotted the draw)

Lot 6 – Mariano Fangonil

Lot 7 – Milagros F. Layug

xxxx

SEVENTH PARCEL

xxxx

The draw was made on the same day, August 27, 1998. Just like in the drawing of lots for the Sixth Parcel,
Carmen F. Herrera boycotted the draw. Hence, the Court ruled that since there are seven rolled papers for the
seven heirs to draw, the last undrawn rolled-paper containing the lot number shall be for Carmen Herrera. The
result for the draw for the seventh parcel was as follows:

Lot 1 – Carmen Herrera

Lot 2 – Tomas Fangonil

Lot 3 – Milagros F. Layug

Lot 4 –Marina Fangonil

Lot 5 – Sinforoso Fangonil

Lot 6 – Mariano Fangonil

Lot 7 – Pura F. Tino

It should be noted that after the draws on August 27, 1998, Atty. Baltazar, counsel for [respondents],
manifested that he will file a motion as regards the accounting of the produce of the sixth and seventh parcels.
However, what he filed was the Manifestation/Motion dated August 31, 1998.

The six heirs (excluding Carmen F. Herrera) shall reimburse the amount of ₱138,100.00, each one contributing
the amount of ₱19,728.57, to Carmen F. Herrera. Since the other six heirs did not insist on the accounting of
the produce with respect to parcels 6 and 7, Carmen F. Herrera does not have to render an accounting. As a
matter of fact, this Court, in its Order dated October 7, 1998, considered the produce of the said two (2)
parcels, which she appropriated from the ‘50s to the present as interest on her money.13

Petitioner appealed the above RTC Decision to the Court of Appeals, alleging the unfair and prejudicial manner
of partition of parcel 1 and claiming exclusive ownership over parcels 6 and 7. The Court of Appeals denied the
appeal in its Decision promulgated 30 January 2004, the dispositive portion of which reads:

WHEREFORE, the October 9, 1998 Decision of the Regional Trial Court of Agoo, La Union, Branch 31, in
Special Proceeding Case No. A-806, is AFFIRMED in toto."14
Under said decision, the Court of Appeals affirmed in toto the findings of the trial court, pronouncing that
petitioner failed to adduce any evidence that would support her claim that the distribution was not equal and
prejudicial to her interest. It concurred with the trial court in concluding that, at the most, she is only entitled to
the reimbursement of the amount she spent for redemption of the questioned lots in an amount equivalent to
what her money commanded then, stating that petitioner is simply holding the said property in trust for the other
co-heirs. At the same time, it upheld the trial court’s finding on the equivalent of the money which petitioner
paid to redeem and repurchase parcels 6 and 7, but the dispositive portion merely indicated the amount of
₱130,100.00.

Petitioner filed a Motion for Reconsideration of the 30 January 2004 Decision which the Court of Appeals
denied in a Resolution dated 15 July 2005. Dissatisfied with the final resolution of the Court of Appeals on the
matter, petitioner now comes before this Court via a Petition for Review under Rule 45 of the Revised Rules of
Court. Petitioner insists she is the exclusive owner of parcels 6 and 7 and rejects the partition of parcel 1 as
being unequal and prejudicial, raising the following issues:

I.

THE RESPONDENT COURT GRAVELY ERRED IN SUSTAINING THE MANNER IN WHICH


PARCEL 1 IS TO BE PARTITIONED BASED ON THE PRIVATE RESPONDENTS’ POSITION WHICH
IS CLEARLY UNEVEN AND UNFAIR TO THE PETITIONER WHOSE SHARE WILL THEN BE
FOUND AT THE REAR PORTION OF THE SAID LOT.

II.

THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN NOT HOLDING THAT PARCELS 6
AND 7 SHALL BE OWNED SOLELY AND EXCLUSIVELY BY THE PETITIONER BEING THE ONLY
ONE WHO REDEEMED AND REPURCHASED SAID PARCELS IN THE 1950’S EVEN WHILE THE
PARENTS OF THE PARTIES WERE STILL ALIVE.

III.

THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN NOT HOLDING THAT THE
PRIVATE RESPONDENTS’ RIGHT TO CLAIM A SHARE IN PARCELS 6 AND 7 HAD LONG
PRESCRIBED AS A RESULT OF THEIR INACTION FOR MORE THAN FORTY (40) YEARS WHERE
THEY ALLOWED THE PETITIONER TO EXERCISE FULL OWNERSHIP OVER SAID PARCELS,
EVEN ASSUMING WITHOUT ADMITTING THAT AT FIRST, THEY HAVE THE RIGHT TO REDEEM
THE SAID PARCELS.

IV.

THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN NOT HOLDING THAT THE
PRIVATE RESPONDENTS’ RIGHT TO CLAIM A SHARE IN PARCELS 6 AND 7 HAD LONG BEEN
BARRED BY LACHES AS A RESULT OF THEIR INACTION FOR MORE THAN FORTY (40) YEARS
WHERE THEY ALLOWED THE PETITIONER [TO] EXERCISE FULL OWNERSHIP OVER SAID
PARCELS, EVEN ASSUMING WITHOUT ADMITTING THAT AT FIRST, THEY HAVE THE RIGHT TO
REDEEM THE SAID PARCELS.

V.

THE TRIAL COURT GRAVELY ERRED IN HOLDING THAT THE MONEY EQUIVALENT OF THE
MONEY OF THE OPPOSITOR-APPELLANT WHICH SHE USED TO REPURCHASE AND REDEEM
PARCELS 6 AND 7 IN THE 1950’S WOULD ONLY BE P138,100.00 IN TODAY’S MONEY, EVEN
ASSUMING WITHOUT ADMITTING THAT THE SAID PARCELS COULD BE REDEEMED BY THE
ESTATE OF FABIAN AND MARIA LLOREN.15
Petitioner’s arguments are fallacious.

With respect to procedural matters, respondents argue that the petition is a combination of an appeal via a
petition for review on certiorari under Rule 45 and an independent civil action of certiorari under Rule 65 of the
Revised Rules of Court. This is based on the observation that petitioner impleaded the Court of Appeals as one
of the respondents while at the same time raising issues of fact alone. Respondents posit that these are
indicative of an "intention to categorize the petition to be under both Rules 65 and 45 of the Rules of Court" and
should be dismissed outright. Although petitioner erroneously impleaded the Court of Appeals as one of the
respondents, petitioner clearly and rightly invoked Rule 45 of the Revised Rules of Court as the remedy availed
of. As we held in National Irrigation Administration v. Court of Appeals,16 the appeal from a final disposition of
the Court of Appeals is a petition for review under Rule 45 and not a special civil action under Rule 65 of the
Revised Rules of Court. Under Rule 45 of the Revised Rules of Court, decisions, final orders or resolutions of
the Court of Appeals, regardless of the nature of the action or proceedings involved, may be appealed to us by
filing a petition for review, which would be but a continuation of the appellate process over the original
case.17 The correct procedure is not to implead the Court of Appeals. This Court has ruled in several instances
that where the Court of Appeals is impleaded as respondent in the Petition for Review, and the petition clearly
invokes Rule 45, the Court of Appeals is merely omitted from the title of the case pursuant to Sec. 4(a) of Rule
45 of the Revised Rules of Court.18 The Court of Appeals is herein omitted from the title of the case, as a liberal
interpretation of the rules on technicality, in pursuit of the ends of justice and equity. 19

We now discuss respondents’ contention that only factual issues have been brought to this Court.

Under Section 1, Rule 45, providing for appeals by certiorari before the Supreme Court, it is clearly enunciated
that only questions of law may be set forth.20 Questions of fact may not be raised unless the case falls under
any of the following exceptions21 :

(1) when the findings are grounded entirely on speculation, surmises, or conjectures; (2) when the inference
made is manifestly mistaken, absurd, or impossible; (3) when there is grave abuse of discretion; (4) when the
judgment is based on a misapprehension of facts; (5) when the findings of fact are conflicting; (6) when in
making its findings the Court of Appeals went beyond the issues of the case, or its findings are contrary to the
admissions of both the appellant and the appellee; (7) when the findings are contrary to those of the trial court;
(8) when the findings are conclusions without citation of specific evidence on which they are based; (9) when
the facts set forth in the petition as well as in the petitioner’s main and reply briefs are not disputed by the
respondent; and (10) when the findings of fact are premised on the supposed absence of evidence and
contradicted by the evidence on record.

In this particular instance, we are clearly faced with issues of fact. A question of fact is involved when the doubt
or difference arises as to the truth or falsehood of alleged facts or when the query necessarily invites calibration
of the whole evidence, considering mainly the credibility of witnesses, existence and relevance of specific
surrounding circumstances, their relation to each other and to the whole, and the probabilities of the
situation.22 We find that the only questions to be resolved are the following: (a) whether or not the respondent
court gravely erred in affirming the partition of parcel 1 in accordance with the findings of the trial court; and (b)
whether or not the respondent court gravely erred in not finding that exclusive ownership of the properties in
question has been vested in petitioner.

In the exercise of the Supreme Court’s power of review, this Court is not a trier of facts, and unless there are
excepting circumstances, it does not routinely undertake the re-examination of the evidence presented by the
contending parties during the trial of the case.23 Factual matters are beyond the jurisdiction of this Court.24 In
petitions for review on certiorari under Rule 45 of the Revised Rules of Court, this Court is limited to reviewing
only errors of law, not of fact, unless the factual findings complained of are devoid of support by the evidence
on record or the assailed judgment is based on a misapprehension of facts. As held in Philippine Airlines, Inc.
v. Court of Appeals,25 factual findings of the Court of Appeals are conclusive26 on the parties and carry even
more weight when the said court affirms the factual findings of the trial court.27 Absent any palpable error or
arbitrariness, the findings of fact of the lower court are conclusive. On this ground alone, the appeal warrants a
dismissal.
Setting aside the procedural defects, the appeal must fail based on the merits. Upon perusal of the records of
the case, it is evident to this Court that no cogent reason exists to disturb the decision of the Court of Appeals.

Petitioner contends that the manner of partition of parcel 1 by the RTC, as affirmed by the Court of Appeals, is
unfair and prejudicial to her interest. However, she was not able to adduce substantial evidence aliunde to
support her allegations. Respondents stress that the Fangonil spouses appropriated portions of Parcel 1 to
Carmen, Pura, Tomas, Marina, and Sinforoso, by pointing out specific areas pertaining to each. Carmen,
Tomas, and Marina built their houses on parcel 1. Prior to the order of partition, an ocular inspection of parcel 1
was conducted by the RTC to determine which manner of partition it would approve. During said ocular
inspection, however, the RTC saw existing structures upon which the homes of Carmen, Tomas, Marina, and a
store of Carmen were situated. The arrangement was allegedly based on their oral agreement. This same
arrangement allotting an equal area of 362 square meters to each of the heirs was made the basis of the
manner of partition proposed by respondents and later on approved by both the RTC and Court of Appeals.

Anent the rights of the parties pertaining to parcels 6 and 7, petitioner insists that her act of paying for the
repurchase and release from mortgage of parcels 6 and 7 was on the understanding with her parents that she
would thereafter be the owner thereof. She asserts that her exercise of acts of ownership over parcels 6 and 7,
to the exclusion of her parents and siblings, reveals she is the exclusive owner of these lots. She cites several
circumstances in support of her contention that respondents never considered parcels 6 and 7 part of the
estate of their parents and are not co-owners thereof. First, petitioner presented real estate tax receipts
indicating that she had been the one paying for the realty taxes of the property. Secondly, petitioner asserts
she has been the only one hiring tenants for and benefiting from the produce of parcels 6 and 7. Lastly, the
non-attempt of respondents to partition parcels 6 and 7 within 10 years from the death of the Fangonil spouses,
as well as to reimburse her if indeed such was the agreement, demonstrates that they never considered the
said parcels part of the estate of their parents.

After a thorough examination of the cases cited by petitioner and a painstaking review of the case records, this
Court cannot give credence to petitioner’s stance. The scales of justice overwhelmingly tilt in favor of
respondents and against petitioner’s assertion that exclusive ownership of parcels 6 and 7 has vested in her.
The fact that it was petitioner’s money that was used for the repurchase of the properties does not make her
the owner thereof, in the absence of convincing proof that would indicate such. This is more so if other
evidence was adduced to show such is not the case. Neither will petitioner’s exercise of acts of ownership over
the properties bring us to that conclusion. It is evident that petitioner was allowed to maintain possession and
enjoy the fruits of the property only by the mere tolerance of the other co-owners.28 Moreover, although we
recognize that real estate tax receipts indicating payment of realty tax and possession of the parcels are indicia
of ownership, such are not conclusive proof of ownership, in the presence of other circumstances and evidence
showing otherwise.29 As a matter of fact, although the receipts indicate that the real estate tax payments for
parcels 6 and 7 for the years following their repurchase and release were made by petitioner, the receipts also
state that the declared owner of the properties is still the decedent Fabian Fangonil.

Petitioner and respondents executed an extrajudicial settlement dated 14 November 1983, wherein it was
stipulated that the Fangonil spouses died intestate, leaving 7 parcels of land in their names. Parcels 6 and 7
were included. It further stipulated that petitioner and her brother Tomas (now deceased) are the only creditors
of the estate, categorically stating petitioner is a creditor of the estate in the amount of ₱8,700.00. This amount
represents what was paid for by her for the repurchase and release from the mortgage lien of parcels 6 and 7
in the 1950s. Pertinent records of the case reveal that the amount actually advanced for the repurchase was
₱6,100.00. The aforementioned extrajudicial settlement, which was later on submitted to the RTC for
consideration in the judicial partition, taken together with petitioner’s comment 30 in the same proceedings, are
clear and categorical evidences that the transaction between petitioner and her parents was a mere loan.
Under this extrajudicial settlement, respondents and petitioner included parcels 6 and 7 as part of the estate of
their deceased parents. It is particularly stated therein that petitioner and her brother Tomas are the only
creditors of the estate. Although petitioner’s comment allegedly maintained her claims on parcels 6 and 7, she
categorically admitted therein that the amount totaling ₱8,700.00 referred to in the extrajudicial settlement
represents the personal money she used for the redemption of parcels 6 and 7.

Thus, petitioner is a mere creditor of the estate and not an owner of parcels 6 and 7. An admission, verbal or
written, made by a party in the course of the proceedings in the same case, does not require proof. The
admission may be contradicted only by showing that it was made through palpable mistake, or that no such
admission was made.31We find that petitioner’s affidavit retracting her acquiescence to the stipulation on
parcels 6 and 7 in the extrajudicial settlement deserves scant consideration for being self-serving. Absent
positive proof that the earlier statements made by petitioner resulted from palpable mistake, retractions thereof,
especially if unsupported by evidence, lack credence.32

As to the issue of prescription, petitioner’s possession of parcels 6 and 7 did not ripen into sole and exclusive
ownership thereof. First, prescription applies to adverse, open, continuous, and exclusive possession. In order
that a co-owner’s possession may be deemed adverse to the other co-owners, the following elements33 must
concur: (1) that he has performed unequivocal acts of repudiation amounting to an ouster of the other co-
owners; (2) that such positive acts of repudiation have been made known to the other co-owners; and (3) that
the evidence thereon must be clear and convincing. Clearly, petitioner cannot claim adverse possession in the
concept of an owner where she voluntarily executed documents stating that she was a mere creditor and/or co-
owner. Mere silent possession by a co-owner; his receipt of rents, fruits or profits from the property; his erection
of buildings and fences and the planting of trees thereon; and the payment of land taxes cannot serve as proofs
of exclusive ownership, if it is not borne out by clear and convincing evidence that he exercised acts of
possession which unequivocably constituted an ouster or deprivation of the rights of the other co-owners.34 In
this case, we find that petitioner effected no clear and evident repudiation of the co-ownership. Petitioner’s only
act of repudiation of the co-ownership was when she refused to honor the extrajudicial settlement in 1994.
Alternatively, possession by a co-owner is like that of a trustee and shall not be regarded as adverse to the
other co-owners, but in fact as beneficial to all of them.35 A co-ownership is a form of trust, with each owner
being a trustee for each other.36 Mere actual possession by one will not give rise to the inference that the
possession was adverse because a co-owner is, after all, entitled to possession of the property. 37 Thus, as a
rule, prescription does not run in favor of a co-heir or co-owner as long as he expressly or impliedly recognizes
the co-ownership; and he cannot acquire by prescription the share of the other co-owners, absent a clear
repudiation of the co-ownership.38 An action to demand partition among co-owners is imprescriptible, and each
co-owner may demand at any time the partition of the common property. 39

On the matter of laches, we find no sufficient cause to apply the principle of laches, it being a principle
grounded on equity. Laches is the failure or neglect, for an unreasonable and unexplained length of time, to do
that which, by exercising due diligence, could or should have been done earlier; it is negligence or omission to
assert a right within a reasonable time, warranting the presumption that the party entitled to assert it either has
abandoned or declined to assert it.40 Several circumstances must be present. First, there should exist conduct
on the part of the defendant or one under whom he claims, giving rise to the situation of which complaint is
made and for which the complainant seeks a remedy. Second, there is delay in asserting the complainant’s
right, the complainant having had knowledge or notice of defendant’s conduct and having been afforded an
opportunity to institute a suit. Third, defendant had no knowledge or notice that the complainant would assert
the right on which he bases his claim. Fourth, the defendant will suffer injury or prejudice in the event relief is
accorded the complainant, or the suit is not held barred. Petitioner failed to prove the presence of all four
established requisites of laches. Moreover, there is no absolute rule as to what constitutes laches or staleness
of demand; each case is to be determined according to its particular circumstances, with the question of laches
addressed to the sound discretion of the court.41 Because laches is an equitable doctrine, its application is
controlled by equitable considerations and should not be used to defeat justice or to perpetuate fraud or
injustice.42

Regarding the issue on the computation of the money to be paid to petitioner as reimbursement for the amount
she advanced to repurchase and release parcels 6 and 7 from the mortgage debt, the Court of Appeals
adopted the amount as computed by the RTC based on the present peso money equivalent.43 There is a
discrepancy between the amount of indebtedness as quoted by the Court of Appeals from the RTC decision
and the amount cited by the Court of Appeals in the latter part of its decision. However, the amount stated in
the paragraph before the dispositive portion was ₱130,100.00, without any other indication that it intended to
modify the amount determined by the RTC while the body of the Court of Appeals decision quoting the RTC
decision indicated the amount of indebtedness as ₱138,100.00. There was obviously a typographical error,
with the body of the decision stating that the Court of Appeals was affirming the RTC’s manner of computation
totaling ₱138,100.00. Moreover, in the body and dispositive portion, the Court of Appeals upheld the RTC’s
decision in toto. Even then, the amount found by the RTC on the basis of the formula it used in the Order dated
7 October 1998 was erroneous.44
Still applying the present peso-dollar exchange rate, a slight modification in the computation is hereby ordered.
The present peso equivalent of the ₱6,100.00 indebtedness incurred on 13 November 1959 by the Fangonil
spouses and payable to petitioner should be computed based on the following figures:

The currency exchange rate of the Philippine Peso to the United States Dollar in the 1950s, which is
₱2.00:$1.00;

Currency exchange rate of the Philippine Peso to the United States Dollar as of the date of finality of this
judgment.

Therefore, the present peso money equivalent of the ₱6,100.00 should be derived from the succeeding
formula:

[(Current exchange rate of the Philippine Peso to the United States Dollar as of the date of finality of this
judgment divided by the exchange rate in the 1950s)] multiplied by ₱6,100.00 1av vphi1

WHEREFORE, premises considered, the instant Petition for Review is DENIED. The (a) Decision issued by the
Court of Appeals dated 30 January 2004 and (b) its Resolution dated 15 July 2005 denying petitioner’s Motion
for Reconsideration dated 23 February 2004 are hereby affirmed, with MODIFICATION as to the amount to be
reimbursed to petitioner. The present peso equivalent of the ₱6,100.00 indebtedness is hereby ordered
reimbursed to petitioner which amount shall be computed based on current peso-dollar exchange rates at the
time of finality of judgment, applying the formula below:

[(Current exchange rate of the Philippine Peso to the United States Dollar as of the date of finality of this
judgment divided by the exchange rate in the 1950s)] multiplied by ₱6,100.00

The equivalent amount shall be proportionately paid by all the heirs with each and every heir having a share in
the said indebtedness. No Costs.
G.R. No. 168970 January 15, 2010

CELESTINO BALUS, Petitioner,


vs.
SATURNINO BALUS and LEONARDA BALUS VDA. DE CALUNOD, Respondents.

DECISION

PERALTA, J.:

Assailed in the present petition for review on certiorari under Rule 45 of the Rules of Court is the Decision1 of
the Court of Appeals (CA) dated May 31, 2005 in CA-G.R. CV No. 58041 which set aside the February 7, 1997
Decision of the Regional Trial Court (RTC) of Lanao del Norte, Branch 4 in Civil Case No. 3263.

The facts of the case are as follows:

Herein petitioner and respondents are the children of the spouses Rufo and Sebastiana Balus. Sebastiana died
on September 6, 1978, while Rufo died on July 6, 1984.

On January 3, 1979, Rufo mortgaged a parcel of land, which he owns, as security for a loan he obtained from
the Rural Bank of Maigo, Lanao del Norte (Bank). The said property was originally covered by Original
Certificate of Title No. P-439(788) and more particularly described as follows:

A parcel of land with all the improvements thereon, containing an area of 3.0740 hectares, more or less,
situated in the Barrio of Lagundang, Bunawan, Iligan City, and bounded as follows: Bounded on the NE., along
line 1-2, by Lot 5122, Csd-292; along line 2-12, by Dodiongan River; along line 12-13 by Lot 4649, Csd-292;
and along line 12-1, by Lot 4661, Csd-292. x x x 2

Rufo failed to pay his loan. As a result, the mortgaged property was foreclosed and was subsequently sold to
the Bank as the sole bidder at a public auction held for that purpose. On November 20, 1981, a Certificate of
Sale3 was executed by the sheriff in favor of the Bank. The property was not redeemed within the period
allowed by law. More than two years after the auction, or on January 25, 1984, the sheriff executed a Definite
Deed of Sale4 in the Bank's favor. Thereafter, a new title was issued in the name of the Bank.

On October 10, 1989, herein petitioner and respondents executed an Extrajudicial Settlement of
Estate5adjudicating to each of them a specific one-third portion of the subject property consisting of 10,246
square meters. The Extrajudicial Settlement also contained provisions wherein the parties admitted knowledge
of the fact that their father mortgaged the subject property to the Bank and that they intended to redeem the
same at the soonest possible time.

Three years after the execution of the Extrajudicial Settlement, herein respondents bought the subject property
from the Bank. On October 12, 1992, a Deed of Sale of Registered Land6 was executed by the Bank in favor of
respondents. Subsequently, Transfer Certificate of Title (TCT) No. T-39,484(a.f.)7 was issued in the name of
respondents. Meanwhile, petitioner continued possession of the subject lot.

On June 27, 1995, respondents filed a Complaint8 for Recovery of Possession and Damages against petitioner,
contending that they had already informed petitioner of the fact that they were the new owners of the disputed
property, but the petitioner still refused to surrender possession of the same to them. Respondents claimed that
they had exhausted all remedies for the amicable settlement of the case, but to no avail.

On February 7, 1997, the RTC rendered a Decision9 disposing as follows:

WHEREFORE, judgment is hereby rendered, ordering the plaintiffs to execute a Deed of Sale in favor of the
defendant, the one-third share of the property in question, presently possessed by him, and described in the
deed of partition, as follows:
A one-third portion of Transfer Certificate of Title No. T-39,484 (a.f.), formerly Original Certificate of Title No. P-
788, now in the name of Saturnino Balus and Leonarda B. Vda. de Calunod, situated at Lagundang, Bunawan,
Iligan City, bounded on the North by Lot 5122; East by shares of Saturnino Balus and Leonarda Balus-
Calunod; South by Lot 4649, Dodiongan River; West by Lot 4661, consisting of 10,246 square meters,
including improvements thereon.

and dismissing all other claims of the parties.

The amount of ₱6,733.33 consigned by the defendant with the Clerk of Court is hereby ordered delivered to the
plaintiffs, as purchase price of the one-third portion of the land in question.

Plaintiffs are ordered to pay the costs.

SO ORDERED.10

The RTC held that the right of petitioner to purchase from the respondents his share in the disputed property
was recognized by the provisions of the Extrajudicial Settlement of Estate, which the parties had executed
before the respondents bought the subject lot from the Bank.

Aggrieved by the Decision of the RTC, herein respondents filed an appeal with the CA.

On May 31, 2005, the CA promulgated the presently assailed Decision, reversing and setting aside the
Decision of the RTC and ordering petitioner to immediately surrender possession of the subject property to the
respondents. The CA ruled that when petitioner and respondents did not redeem the subject property within the
redemption period and allowed the consolidation of ownership and the issuance of a new title in the name of
the Bank, their co-ownership was extinguished.

Hence, the instant petition raising a sole issue, to wit:

WHETHER OR NOT CO-OWNERSHIP AMONG THE PETITIONER AND THE RESPONDENTS OVER THE
PROPERTY PERSISTED/CONTINUED TO EXIST (EVEN AFTER THE TRANSFER OF TITLE TO THE
BANK) BY VIRTUE OF THE PARTIES' AGREEMENT PRIOR TO THE REPURCHASE THEREOF BY THE
RESPONDENTS; THUS, WARRANTING THE PETITIONER'S ACT OF ENFORCING THE AGREEMENT BY
REIMBURSING THE RESPONDENTS OF HIS (PETITIONER'S) JUST SHARE OF THE REPURCHASE
PRICE.11

The main issue raised by petitioner is whether co-ownership by him and respondents over the subject property
persisted even after the lot was purchased by the Bank and title thereto transferred to its name, and even after
it was eventually bought back by the respondents from the Bank.

Petitioner insists that despite respondents' full knowledge of the fact that the title over the disputed property
was already in the name of the Bank, they still proceeded to execute the subject Extrajudicial Settlement,
having in mind the intention of purchasing back the property together with petitioner and of continuing their co-
ownership thereof.

Petitioner posits that the subject Extrajudicial Settlement is, in and by itself, a contract between him and
respondents, because it contains a provision whereby the parties agreed to continue their co-ownership of the
subject property by "redeeming" or "repurchasing" the same from the Bank. This agreement, petitioner
contends, is the law between the parties and, as such, binds the respondents. As a result, petitioner asserts
that respondents' act of buying the disputed property from the Bank without notifying him inures to his benefit
as to give him the right to claim his rightful portion of the property, comprising 1/3 thereof, by reimbursing
respondents the equivalent 1/3 of the sum they paid to the Bank.

The Court is not persuaded.


Petitioner and respondents are arguing on the wrong premise that, at the time of the execution of the
Extrajudicial Settlement, the subject property formed part of the estate of their deceased father to which they
may lay claim as his heirs.

At the outset, it bears to emphasize that there is no dispute with respect to the fact that the subject property
was exclusively owned by petitioner and respondents' father, Rufo, at the time that it was mortgaged in 1979.
This was stipulated by the parties during the hearing conducted by the trial court on October 28,
1996.12 Evidence shows that a Definite Deed of Sale13 was issued in favor of the Bank on January 25, 1984,
after the period of redemption expired. There is neither any dispute that a new title was issued in the Bank's
name before Rufo died on July 6, 1984. Hence, there is no question that the Bank acquired exclusive
ownership of the contested lot during the lifetime of Rufo.

The rights to a person's succession are transmitted from the moment of his death.14 In addition, the inheritance
of a person consists of the property and transmissible rights and obligations existing at the time of his death, as
well as those which have accrued thereto since the opening of the succession. 15 In the present case, since
Rufo lost ownership of the subject property during his lifetime, it only follows that at the time of his death, the
disputed parcel of land no longer formed part of his estate to which his heirs may lay claim. Stated differently,
petitioner and respondents never inherited the subject lot from their father.

Petitioner and respondents, therefore, were wrong in assuming that they became co-owners of the subject lot.
Thus, any issue arising from the supposed right of petitioner as co-owner of the contested parcel of land is
negated by the fact that, in the eyes of the law, the disputed lot did not pass into the hands of petitioner and
respondents as compulsory heirs of Rufo at any given point in time.

The foregoing notwithstanding, the Court finds a necessity for a complete determination of the issues raised in
the instant case to look into petitioner's argument that the Extrajudicial Settlement is an independent contract
which gives him the right to enforce his right to claim a portion of the disputed lot bought by respondents. 1avv phi 1

It is true that under Article 1315 of the Civil Code of the Philippines, contracts are perfected by mere consent;
and from that moment, the parties are bound not only to the fulfillment of what has been expressly stipulated
but also to all the consequences which, according to their nature, may be in keeping with good faith, usage and
law.

Article 1306 of the same Code also provides that the contracting parties may establish such stipulations,
clauses, terms and conditions as they may deem convenient, provided these are not contrary to law, morals,
good customs, public order or public policy.

In the present case, however, there is nothing in the subject Extrajudicial Settlement to indicate any express
stipulation for petitioner and respondents to continue with their supposed co-ownership of the contested lot.

On the contrary, a plain reading of the provisions of the Extrajudicial Settlement would not, in any way, support
petitioner's contention that it was his and his sibling's intention to buy the subject property from the Bank and
continue what they believed to be co-ownership thereof. It is a cardinal rule in the interpretation of contracts
that the intention of the parties shall be accorded primordial consideration.16 It is the duty of the courts to place
a practical and realistic construction upon it, giving due consideration to the context in which it is negotiated
and the purpose which it is intended to serve.17 Such intention is determined from the express terms of their
agreement, as well as their contemporaneous and subsequent acts.18 Absurd and illogical interpretations
should also be avoided.19

For petitioner to claim that the Extrajudicial Settlement is an agreement between him and his siblings to
continue what they thought was their ownership of the subject property, even after the same had been bought
by the Bank, is stretching the interpretation of the said Extrajudicial Settlement too far.

In the first place, as earlier discussed, there is no co-ownership to talk about and no property to partition, as the
disputed lot never formed part of the estate of their deceased father.
Moreover, petitioner's asseveration of his and respondents' intention of continuing with their supposed co-
ownership is negated by no less than his assertions in the present petition that on several occasions he had the
chance to purchase the subject property back, but he refused to do so. In fact, he claims that after the Bank
acquired the disputed lot, it offered to re-sell the same to him but he ignored such offer. How then can petitioner
now claim that it was also his intention to purchase the subject property from the Bank, when he admitted that
he refused the Bank's offer to re-sell the subject property to him?

In addition, it appears from the recitals in the Extrajudicial Settlement that, at the time of the execution thereof,
the parties were not yet aware that the subject property was already exclusively owned by the Bank.
Nonetheless, the lack of knowledge on the part of petitioner and respondents that the mortgage was already
foreclosed and title to the property was already transferred to the Bank does not give them the right or the
authority to unilaterally declare themselves as co-owners of the disputed property; otherwise, the disposition of
the case would be made to depend on the belief and conviction of the party-litigants and not on the evidence
adduced and the law and jurisprudence applicable thereto.

Furthermore, petitioner's contention that he and his siblings intended to continue their supposed co-ownership
of the subject property contradicts the provisions of the subject Extrajudicial Settlement where they clearly
manifested their intention of having the subject property divided or partitioned by assigning to each of the
petitioner and respondents a specific 1/3 portion of the same. Partition calls for the segregation and
conveyance of a determinate portion of the property owned in common. It seeks a severance of the individual
interests of each co-owner, vesting in each of them a sole estate in a specific property and giving each one a
right to enjoy his estate without supervision or interference from the other.20 In other words, the purpose of
partition is to put an end to co-ownership,21 an objective which negates petitioner's claims in the present case.

WHEREFORE, the instant petition is DENIED. The assailed Decision of the Court of Appeals, dated May 31,
2005 in CA-G.R. CV No. 58041, is AFFIRMED.
G.R. No. 186269 February 15, 2012

SPOUSES ROMAN A. PASCUAL and MERCEDITA R. PASCUAL, FRANCISCO A. PASCUAL,


MARGARITA CORAZON D. MARIANO, EDWIN D. MARIANO and DANNY R. MARIANO Petitioners,
vs.
SPOUSES ANTONIO BALLESTEROS and LORENZA MELCHOR-BALLESTEROS, Respondents.

RESOLUTION

REYES, J.:

This is a petition for review on certiorari under Rule 45 of the Rules of Court filed by the spouses Roman A.
Pascual and Mercedita R. Pascual (Spouses Pascual), Francisco A. Pascual (Francisco), Margarita Corazon
D. Mariano (Margarita), Edwin D. Mariano and Danny R. Mariano (petitioners) assailing the Decision 1 dated July
29, 2008 and Resolution2 dated January 30, 2009 issued by the Court of Appeals (CA) in CA-G.R. CV No.
89111.

The instant case involves a 1,539 square meter parcel of land (subject property) situated in Barangay Sta.
Maria, Laoag City and covered by Transfer Certificate of Title (TCT) No. T-303753 of the Laoag City registry.
The subject property is owned by the following persons, with the extent of their respective shares over the
same: (1) the spouses Albino and Margarita Corazon Mariano, 330 square meters; (2) Angela Melchor
(Angela), 466.5 square meters; and (3) the spouses Melecio and Victoria Melchor (Spouses Melchor), 796.5
square meters.

Upon the death of the Spouses Melchor, their share in the subject property was inherited by their daughter
Lorenza Melchor Ballesteros (Lorenza). Subsequently, Lorenza and her husband Antonio Ballesteros
(respondents) acquired the share of Angela in the subject property by virtue of an Affidavit of Extrajudicial
Settlement with Absolute Sale4dated October 1, 1986.

On August 11, 2000, Margarita, then already widowed, together with her children, sold their share in the subject
property to Spouses Pascual and Francisco.5 Subsequently, Spouses Pascual and Francisco caused the
cancellation of TCT No. 30375 and, thus, TCT No. T-325226 was then issued in their names together with
Angela and Spouses Melchor.

Consequently, the respondents, claiming that they did not receive any written notice of the said sale in favor of
Spouses Pascual and Francisco, filed with the Regional Trial Court (RTC) of Laoag City a Complaint 7 for legal
redemption against the petitioners. The respondents claimed that they are entitled to redeem the portion of the
subject property sold to Spouses Pascual and Francisco being co-owners of the same.

For their part, the petitioners claimed that there was no co-ownership over the subject property considering that
the shares of the registered owners thereof had been particularized, specified and subdivided and, hence, the
respondents has no right to redeem the portion of the subject property that was sold to them. 8

On January 31, 2007, the RTC rendered a decision9 dismissing the complaint for legal redemption filed by the
respondents. In disposing of the said complaint, the RTC summed up the issues raised therein as follows: (1)
whether the respondents herein and the predecessors-in-interest of the petitioners are co-owners of the subject
property who have the right of redemption under Article 1620 of the Civil Code; and (2) if so, whether that right
was seasonably exercised by the respondents within the 30-day redemption period under Article 1623 of the
Civil Code.

On the first issue, the RTC held that the respondents and the predecessors-in-interest of the petitioners are co-
owners of the subject property considering that the petitioners failed to adduce any evidence showing that the
respective shares of each of the registered owners thereof were indeed particularized, specified and
subdivided.
On the second issue, the RTC ruled that the respondents failed to seasonably exercise their right of redemption
within the 30-day period pursuant to Article 1623 of the Civil Code. Notwithstanding the lack of a written notice
of the sale of a portion of the subject property to Spouses Pascual and Francisco, the RTC asserted that the
respondents had actual notice of the said sale. Failing to exercise their right of redemption within 30 days from
actual notice of the said sale, the RTC opined that the respondents can no longer seek for the redemption of
the property as against the petitioners.

Thereupon, the respondents appealed from the January 31, 2007 decision of the RTC of Laoag City with the
CA. On July 29, 2008, the CA rendered the herein assailed Decision10 the decretal portion of which reads:

WHEREFORE, the appeal is GRANTED and the appealed January 31, 2007 Decision is, accordingly,
REVERSED and SET ASIDE. In lieu thereof, another is entered approving [respondents’] legal redemption of
the portion in litigation. The rest of their monetary claims are, however, DENIED for lack of factual and/or legal
bases.

SO ORDERED.11

In allowing the respondents to exercise their right of redemption, the CA held that the 30-day period within
which to exercise the said right had not yet lapsed considering the absence of a written notice of the said sale.
Thus, the CA stated that "[t]he mandatory nature of the ‘written notice requirement’ is such that,
notwithstanding the actual knowledge of the sale, written notice from the seller is still necessary in order to
remove all uncertainties about the sale, its terms and conditions, as well as its efficacy and status." 12

The petitioners sought for a reconsideration of the said July 29, 2008 Decision, but it was denied by the CA in
its Resolution13 dated January 30, 2009.

Undaunted, the petitioners instituted the instant petition for review on certiorari before this Court essentially
asserting the following arguments: (1) their predecessors-in-interest and the respondents are not co-owners of
the subject property since their respective shares therein had already been particularized, specified and
subdivided; and (2) even if such co-ownership exists, the respondents could no longer exercise their right of
redemption having failed to exercise the same within 30 days from actual knowledge of the said sale.

The petition is denied.

Primarily, Section 1, Rule 45 of the Rules of Court categorically states that the petition filed shall raise only
questions of law, which must be distinctly set forth. A question of law arises when there is doubt as to what the
law is on a certain state of facts, while there is a question of fact when the doubt arises as to the truth or falsity
of the alleged facts. For a question to be one of law, the same must not involve an examination of the probative
value of the evidence presented by the litigants or any of them. The resolution of the issue must rest solely on
what the law provides on the given set of circumstances. Once it is clear that the issue invites a review of the
evidence presented, the question posed is one of fact.14

The first issue raised by the petitioners is a factual question as it entails a determination of whether the subject
property was indeed co-owned by the respondents and the predecessors-in-interest of the petitioners. Such
determination would inevitably necessitate a review of the probative value of the evidence adduced in the case
below.

In any case, it ought to be stressed that both the RTC and the CA found that the subject property was indeed
co-owned by the respondents and the predecessors-in-interest of the petitioners. Thus, in the absence of any
exceptional circumstances to warrant the contrary, this Court must abide by the prevailing rule that findings of
fact of the trial court, more so when affirmed by the CA, are binding and conclusive upon it. 15

Anent the second issue asserted by the petitioners, we find no reversible error on the part of the CA in ruling
that the 30-day period given to the respondents within which to exercise their right of redemption has not
commenced in view of the absence of a written notice. Verily, despite the respondents’ actual knowledge of the
sale to the respondents, a written notice is still mandatory and indispensable for purposes of the
commencement of the 30-day period within which to exercise the right of redemption.

Article 1623 of the Civil Code succinctly provides that:

Article 1623. The right of legal pre-emption or redemption shall not be exercised except within thirty days from
the notice in writing by the prospective vendor, or by the vendor, as the case may be. The deed of sale shall
not be recorded in the Registry of Property, unless accompanied by an affidavit of the vendor that he has given
written notice thereof to all possible redemptioners.

The right of redemption of co-owners excludes that of adjoining owners. (emphasis supplied)

The indispensability of the "written notice requirement" for purposes of the exercise of the right of redemption
was explained by this Court in Barcellano v. Bañas,16 thus:

Nothing in the records and pleadings submitted by the parties shows that there was a written notice sent to the
respondents. Without a written notice, the period of thirty days within which the right of legal pre-emption may
be exercised, does not start.

The indispensability of a written notice had long been discussed in the early case of Conejero v. Court of
Appeals,penned by Justice J.B.L. Reyes:

With regard to the written notice, we agree with petitioners that such notice is indispensable, and that, in view
of the terms in which Article of the Philippine Civil Code is couched, mere knowledge of the sale, acquired in
some other manner by the redemptioner, does not satisfy the statute. The written notice was obviously exacted
by the Code to remove all uncertainty as to the sale, its terms and its validity, and to quiet any doubts that the
alienation is not definitive. The statute not having provided for any alternative, the method of notification
prescribed remains exclusive.

This is the same ruling in Verdad v. Court of Appeals:

The written notice of sale is mandatory. This Court has long established the rule that notwithstanding actual
knowledge of a co-owner, the latter is still entitled to a written notice from the selling co-owner in order to
remove all uncertainties about the sale, its terms and conditions, as well as its efficacy and status.

Lately, in Gosiengfiao Guillen v. The Court of Appeals, this Court again emphasized the mandatory character of
a written notice in legal redemption:

From these premises, we ruled that "[P]etitioner-heirs have not lost their right to redeem, for in the absence of a
written notification of the sale by the vendors, the 30-day period has not even begun to run." These premises
and conclusion leave no doubt about the thrust of Mariano: The right of the petitioner-heirs to exercise their
right of legal redemption exists, and the running of the period for its exercise has not even been
triggered because they have not been notified in writing of the fact of sale.

xxxx

Justice Edgardo Paras, referring to the origins of the requirement, would explain in his commentaries on the
New Civil Code that despite actual knowledge, the person having the right to redeem is STILL entitled to the
written notice. Both the letter and the spirit of the New Civil Code argue against any attempt to widen the scope
of the "written notice" by including therein any other kind of notice such as an oral one, or by registration. If the
intent of the law has been to include verbal notice or any other means of information as sufficient to give the
effect of this notice, there would have been no necessity or reason to specify in the article that said notice be in
writing, for under the old law, a verbal notice or mere information was already deemed sufficient.
Time and time again, it has been repeatedly declared by this Court that where the law speaks in clear and
categorical language, there is no room for interpretation. There is only room for application. Where the
language of a statute is clear and unambiguous, the law is applied according to its express terms, and
interpretation should be resorted to only where a literal interpretation would be either impossible or absurd or
would lead to an injustice. x x x (citations omitted)
1av vphi1

Here, it is undisputed that the respondents did not receive a written notice of the sale in favor of the petitioners.
Accordingly, the 30-day period stated under Article 1623 of the Civil Code within which to exercise their right of
redemption has not begun to run. Consequently, the respondents may still redeem from the petitioners the
portion of the subject property that was sold to the latter.

WHEREFORE, in consideration of the foregoing disquisitions, the petition is DENIED. The assailed Decision
dated July 29, 2008 and Resolution dated January 30, 2009 issued by the Court of Appeals in CA-G.R. CV No.
89111 are AFFIRMED.
G.R. No. L-46364 April 6, 1990

SULPICIA JIMENEZ and TORIBIO MATIAS, petitioners,


vs.
VICENTE FERNANDEZ alias HOSPICIO FERNANDEZ and TEODORA GRADO, respondents.

Antonio E. Bengzon III for petitioners.


Agustin U. Cruz for private respondents.

PARAS, J.:

Before Us is a petition for review on certiorari of the following Decision 1 and Resolution 2 of the Honorable
Court of Appeals: (1) Decision, dated March 1, 1977 in C.A.-G.R. No. 49178-R entitled "Sulpicia Jimenez, et
al., v. Vicente Fernandez, et al." affirming in toto the judgment of the Court of First Instance of Pangasinan,
Third Judicial District in Civil Case No. 14802-I between the same parties and (2) Resolution dated June 3,
1977 denying plaintiffs-appellants' motion for reconsideration.

As gathered from the records, the factual background of this case is as follows:

The land in question is the Eastern portion with an area of Four Hundred Thirty Six (436) square meters of that
parcel of residential land situated in Barrio Dulig (now Magsaysay), Municipality of Labrador, Pangasinan
actually covered by Transfer Certificate of Title No. 82275 (Exhibit A) issued in the name of Sulpicia Jimenez.

The entire parcel of land with an area of 2,932 square meters, formerly belonged to Fermin Jimenez. Fermin
Jimenez has two (2) sons named Fortunato and Carlos Jimenez. This Fortunato Jimenez who predeceased his
father has only one child, the petitioner Sulpicia Jimenez. After the death of Fermin Jimenez, the entire parcel
of land was registered under Act 496 in the name of Carlos Jimenez and Sulpicia Jimenez (uncle and niece) in
equal shares pro-indiviso. As a result of the registration case Original Certificate of Title No. 50933 (Exhibit 8)
was issued on February 28, 1933, in the names of Carlos Jimenez and Sulpicia Jimenez, in equal shares pro-
indiviso.

Carlos Jimenez died on July 9, 1936 and his illegitimate daughter, Melecia Cayabyab, also known as Melecia
Jimenez, took possession of the eastern portion of the property consisting of 436 square meters.

On January 20, 1944, Melecia Jimenez sold said 436 square meter-portion of the property to Edilberto
Cagampan and defendant Teodora Grado executed a contract entitled "Exchange of Real Properties" whereby
the former transferred said 436 square meter-portion to the latter, who has been in occupation since.

On August 29, 1969, plaintiff Sulpicia Jimenez executed an affidavit adjudicating unto herself the other half of
the property appertaining to Carlos Jimenez, upon manifestation that she is the only heir of her deceased
uncle. Consequently Transfer Certificate of Title No. 82275 was issued on October 1, 1969 in petitioner's name
alone over the entire 2,932 square meter property.

On April 1, 1970, Sulpicia Jimenez, joined by her husband, instituted the present action for the recovery of the
eastern portion of the property consisting of 436 square meters occupied by defendant Teodora Grado and her
son.

After trial on the merits, the lower court rendered judgment, the dispositive portion of which reads:

WHEREFORE, decision is hereby rendered dismissing the complaint and holding the defendant,
Teodora Grado, the absolute owner of the land in question; ordering the plaintiffs to pay to the
defendant the amount of P500.00 as damages, as attorney's fees, and to pay the costs of suit.
SO ORDERED. (Rollo, p. 20)

Petitioner appealed the above judgment to the respondent Court of Appeals and on March 1, 1977, respondent
Court of Appeals rendered a decision affirming the same in toto. Said decision was rendered by a special
division of five (5) justices, with the Hon. Lourdes San Diego, dissenting.

Petitioners within the reglementary period granted by the Honorable Court of Appeals, filed therewith a motion
for reconsideration. But said motion for reconsideration was denied by the Court of Appeals in its resolution
dated June 3, 1977.

In their appeal to the respondent Court of Appeals from the aforequoted decision of the trial court, herein
petitioner raised the following assignments of error to wit:

ASSIGNMENTS OF ERROR

THE LOWER COURT ERRED IN NOT DECLARING THAT MELECIA CAYABYAB, ALSO KNOWN
AS MELECIA JIMENEZ, IS NOT THE DAUGHTER OF CARLOS JIMENEZ.

II

THE LOWER COURT ERRED IN NOT DECLARING THAT MELECIA CAYABYAB, ALSO KNOWN
AS MELECIA JIMENEZ, HAS NO RIGHT TO SELL THE LAND IN QUESTION TO EDILBERTO
CAGAMPAN.

III

THE LOWER COURT ERRED IN NOT DECLARING THAT EDILBERTO CAGAMPAN DID NOT
BECOME THE OWNER OF THE LAND IN QUESTION BY VIRTUE OF THE DEED OF SALE (EXH.
"1") EXECUTED BY MELECIA CAYABYAB, ALIAS MELECIA JIMENEZ, IN HIS FAVOR.

IV

THE LOWER COURT ERRED IN NOT DECLARING THAT TEODORA GRADO DID NOT BECOME
THE OWNER OF THE LAND IN QUESTION BY VIRTUE OF THE DEED OF EXCHANGE (EXH. "7")
EXECUTED BY HER AND EDILBERTO CAGAMPAN.

THE LOWER COURT ERRED IN NOT DECLARING THAT THE TITLE OF APPELLANT SULPICIA
JIMENEZ OVER THE LAND IN QUESTION CAN NOT BE DEFEATED BY THE ADVERSE OPEN
AND NOTORIOUS POSSESSION OF APPELLEE TEODORA GRADO.

VI

THE LOWER COURT ERRED IN DECLARING THAT THE APPELLEE TEODORA GRADO IS THE
ABSOLUTE OWNER OF THE LAND IN QUESTION IN THE LIGHT OF THE DECISION OF THE
SUPREME COURT IN THE CASE OF LOURDES ARCUINO, ET AL., V. RUFINA APARIS AND
CASIANO PURAY, G.R. NO. L-23424, PROMULGATED JANUARY 31, 1968, WHICH CASE IS NOT
APPLICABLE TO THE CASE AT BAR.

VII
THE LOWER COURT ERRED IN DISMISSING THE COMPLAINT AND ORDERING THE
APPELLANTS TO PAY THE APPELLEES THE SUM OF P500.00 AS ATTORNEYS FEES PLUS THE
COSTS.

From the foregoing, this petition for review was filed.

We find merit in the petition.

From the start the respondent court erred in not declaring that Melecia Jimenez Cayabyab also known as
Melecia Jimenez, is not the daughter of Carlos Jimenez and therefore, had no right over the property in
question. Respondents failed to present concrete evidence to prove that Melecia Cayabyab was really the
daughter of Carlos Jimenez. Nonetheless, assuming for the sake of argument that Melecia Cayabyab was the
illegitimate daughter of Carlos Jimenez there can be no question that Melecia Cayabyab had no right to
succeed to the estate of Carlos Jimenez and could not have validly acquired, nor legally transferred to Edilberto
Cagampan that portion of the property subject of this petition.

It is well-settled in this jurisdiction that the rights to the succession are transmitted from the moment of the
death of the decedent (Art. 777, Civil Code). Moreover, Art. 2263 of the Civil Code provides as follows:

Rights to the inheritance of a person who died with or without a will, before the effectivity of this Code,
shall be governed by the Civil Code of 1889, by other previous laws, and by the Rules of Court . . .
(Rollo, p. 17)

Thus, since Carlos Jimenez, owner of one-half pro-indiviso portion of that parcel of land then covered by
Original Certificate of title No. 50933, died on July 9, 1936 (Exhibit "F") way before the effectivity of the Civil
Code of the Philippines, the successional rights pertaining to his estate must be determined in accordance with
the Civil Code of 1889.

Citing the case of Cid v. Burnaman (24 SCRA 434) wherein this Court categorically held that:

To be an heir under the rules of Civil Code of 1889 (which was the law in force when Carlos Jimenez
died and which should be the governing law in so far as the right to inherit from his estate was
concerned), a child must be either a child legitimate, legitimated, or adopted, or else an acknowledged
natural child — for illegitimate not natural are disqualified to inherit. (Civil Code of 1889, Art. 807, 935)

Even assuming that Melecia Cayabyab was born out of the common-law-relationship between her mother
(Maria Cayabyab) and Carlos Jimenez, she could not even be considered an acknowledged natural child
because Carlos Jimenez was then legally married to Susana Abalos and therefore not qualified to marry Maria
Cayabyab and consequently Melecia Cayabyab was an illegitimate spurious child and not entitled to any
successional rights in so far as the estate of Carlos Jimenez was concerned.

Melecia Cayabyab in the absence of any voluntary conveyance to her by Carlos Jimenez or Sulpicia Jimenez
of the litigated portion of the land could not even legally transfer the parcel of land to Edilberto Cagampan who
accordingly, could not also legally transfer the same to herein private respondents.

Analyzing the case before Us in this manner, We can immediately discern another error in the decision of the
respondent court, which is that the said court sustained and made applicable to the case at bar the ruling in the
case of Arcuino, et al., v. Aparis and Puray, No. L-23424, January 31, 1968, 22 SCRA 407, wherein We held
that:

. . . it is true that the lands registered under the Torrens System may not be acquired by prescription
but plaintiffs herein are not the registered owners. They merely claim to have acquired by succession,
their alleged title or interest in lot No. 355. At any rate plaintiffs herein are guilty of laches.
The respondent court relying on the Arcuino case, concluded that respondents had acquired the property under
litigation by prescription. We cannot agree with such conclusion, because there is one very marked and
important difference between the case at bar and that of the Arcuino case, and that is, that since 1933
petitioner Sulpicia Jimenez was a title holder, the property then being registered in her and her uncle Carlos
Jimenez' name. In the Arcuino case, this Supreme Court held. "(I)t is true that lands registered under the
Torrens System may not be acquired by prescription but plaintiffs herein are not the registered owners." (Rollo,
p. 38) Even in the said cited case the principle of imprescriptibility of Torrens Titles was respected.

Melecia Cayabyab's possession or of her predecessors-in-interest would be unavailing against the petitioner
Sulpicia Jimenez who was the holder pro-indiviso with Carlos Jimenez of the Torrens Certificate of Title
covering a tract of land which includes the portion now in question, from February 28, 1933, when the Original
Certificate of Title No. 50933 (Exhibit 8) was issued.

No possession by any person of any portion of the land covered by said original certificate of titles, could defeat
the title of the registered owner of the land covered by the certificate of title. (Benin v. Tuason, L-26127, June
28, 1974, 57 SCRA 531)

Sulpicia's title over her one-half undivided property remained good and continued to be good when she
segregated it into a new title (T.C.T No. 82275, Exhibit "A") in 1969. Sulpicia's ownership over her one-half of
the land and which is the land in dispute was always covered by a Torrens title, and therefore, no amount
of possession thereof by the respondents, could ever defeat her proprietary rights thereon. It is apparent, that
the right of plaintiff (now petitioner) to institute this action to recover possession of the portion of the land in
question based on the Torrens Title of Sulpicia Jimenez, T.C.T. No. 82275 (Exhibit "A") is imprescriptible and
not barred under the doctrine of laches. (J.M. Tuason & Co. v. Macalindong, L-15398, December 29, 1962,
Francisco v. Cruz, et al., 43 O.G. 5105) Rollo, p. 39)

The respondent Court of Appeals declared the petitioner Sulpicia Jimenez guilty of laches and citing the ruling
in the case of Heirs of Lacamen v. Heirs of Laruan (65 SCRA 605), held that, since petitioner Sulpicia Jimenez
executed her Affidavit of Self-Adjudication only in 1969, she lost the right to recover possession of the parcel of
land subject of the litigation.

In this instance, again We rule for the petitioner. There is no absolute rule as to what constitutes laches or
staleness of demand; each case is to be determined according to its particular circumstances. The question of
laches is addressed to the sound discretion of the court and since laches is an equitable doctrine, its
application is controlled by equitable considerations. It cannot be worked to defeat justice or to perpetrate fraud
and injustice. It would be rank injustice and patently inequitous to deprive the lawful heirs of their rightful
inheritance.

Petitioner Sulpicia Jimenez is entitled to the relief prayed for, declaring her to be the sole and absolute owner of
the land in question with right to its possession and enjoyment. Since her uncle Carlos Jimenez died in 1936,
his pro-indiviso share in the properties then owned in co-ownership with his niece Sulpicia descended by
intestacy to Sulpicia Jimenez alone because Carlos died without any issue or other heirs.

After all, the professed objective of Act No. 496, otherwise known as the Land Registration Act or the law which
established the Torrens System of Land Registration in the Philippines is that the stability of the landholding
system in the Philippines depends on the confidence of the people in the titles covering the properties. And to
this end, this Court has invariably upheld the indefeasibility of the Torrens Title and in, among others, J.M.
Tuason and Co., Inc. v. Macalindong (6 SCRA 938), held that "the right of the appellee to file an action to
recover possession based on its Torrens Title is imprescriptible and not barred under the doctrine of laches.

WHEREFORE, the Petition for Review is hereby GRANTED. The Decision and Resolution dated March 1,
1977 and June 3, 1977 in CA G.R. No. L-49178-R are SET ASIDE.
G.R. No. 120864 October 8, 2003

MANUEL T. DE GUIA, petitioner,


vs.
COURT OF APPEALS (Former Sixth Division) and JOSE B. ABEJO, represented by his Attorney-in-Fact,
Hermenegilda Abejo-Rivera, respondents.

DECISION

CARPIO, J.:

The Case

This is a Petition for Review on Certiorari1 assailing the 22 August 1994 Decision2 as well as the 27 June 1995
Resolution of the Court of Appeals in CA-G.R. CV No. 39875. The Court of Appeals affirmed the Decision3 of
the Regional Trial Court ("trial court") of Malolos, Bulacan, Branch 16, in Civil Case No. 8796-M. The trial
court’s Decision ordered petitioner Manuel T. De Guia ("DE GUIA") to turn over to private respondent Jose B.
Abejo ("ABEJO") possession of the one half (½) undivided portion of a fishpond and to pay actual damages
and attorney’s fees.

The Antecedents

On 12 May 1986, ABEJO4 instituted an action for recovery of possession with damages against DE GUIA. In his
complaint, ABEJO alleged that he is the owner of the ½ undivided portion of a property used as a fishpond
("FISHPOND") situated in Meycauayan, Bulacan and covered by TCT No. T-6358 of the Bulacan Register of
Deeds. He alleged ownership over approximately 39,611 square meters out of the FISHPOND’s total area of
79,220 square meters. ABEJO further averred that DE GUIA continues to possess and use the FISHPOND
without any contract and without paying rent to ABEJO’s damage and prejudice. ABEJO also complained that
DE GUIA refuses to surrender ownership and possession of the FISHPOND despite repeated demands to do
so after DE GUIA’s sublease contract over the FISHPOND had expired. ABEJO asked the trial court to order
DE GUIA to vacate an approximate area of 39,611 square meters as well as pay damages.

DE GUIA, a lawyer by profession, appeared on his own behalf. He filed his Answer on 12 January 1990 after
the Court of Appeals resolved several issues concerning the validity of the service of summons on him. In his
Answer, DE GUIA alleged that the complaint does not state a cause of action and has prescribed. He claimed
that the FISHPOND was originally owned by Maxima Termulo who died intestate with Primitiva Lejano as her
only heir. According to him, ABEJO is not the owner of the entire FISHPOND but the heirs of Primitiva Lejano
who authorized him to possess the entire FISHPOND. He assailed ABEJO’s ownership of the ½ undivided
portion of the FISHPOND as void and claimed ownership over an undivided half portion of the FISHPOND for
himself. DE GUIA sought payment of damages and reimbursement for the improvements he introduced as a
builder in good faith.

The trial court set the pre-trial and required the parties to file their pre-trial briefs. ABEJO filed his pre-trial
brief5 on 05 April 1990. DE GUIA filed his pre-trial brief6 on 31 July 1990. DE GUIA’s pre-trial brief raised as the
only issue in the case the amount of damages in the form of rent that DE GUIA should pay ABEJO. DE GUIA
also submitted an Offer to Compromise,7 offering to settle ABEJO’s claim for ₱300,000 and to lease the entire
FISHPOND to any party of ABEJO’s choice.

Hearing commenced on 30 July 1990. ABEJO rested his case on 4 December 1990. DE GUIA’s last witness
completed her testimony on 22 November 1991. The trial court summarized the evidence presented by ABEJO
and DE GUIA as follows:

Evidence adduced from plaintiff shows that there are two parcels of land covering a fishpond with a total area
of 79,220 sq. m. more or less, situated at Ubihan, Meycauayan, Bulacan and covered by TCT No. 6358 equally
owned by Primitiva Lejano and Lorenza Araniego married to Juan Abejo (Exh. A). The one half undivided
portion owned by Lorenza Araniego corresponding to 39,611 sq. m. was later purchased by plaintiff from his
father Teofilo Abejo (Exh. B), the only heir of the original owner on November 22, 1983. Prior to this sale on
July 30, 1974 the whole fishpond (79,220) was the subject of a "Salin ng Pamumusisyong ng Palaisdaan"
executed by the heirs of Primitiva Lejano with the knowledge and consent of Teofilo A. Abejo in favor of one
Aniano Victa and defendant. The contract provided that the period of lease shall be until November 30, 1979.
When the contract expired and defendant failed to surrender the fishpond, written demands the last of which
was on November 27, 1983 were made for defendants to pay back rental and to vacate the premises in
question (Exh. D & E). Defendant refused to deliver possession and also to pay the rentals due. In anticipation,
however, that defendant will vacate the fishpond, plaintiff, on December 21, 1983 entered into a two year
"Kasunduan ng Buwisan ng Palaisdaan" with Ruperto C. Villarico for a consideration of ₱50,000.00 (Exh. G).
This contract, despite its execution and even already notarized, had to be cancelled and the amount of
₱50,000.00 returned by plaintiff to Villarico when the defendant did not heed the demand to vacate the
fishpond. For unpaid rental, actual as well as moral and exemplary damages, plaintiff asks payment of
₱450,000.00 and ₱20,000.00 attorney’s fees.

On the other hand, defendant’s evidence tends to show that the entire fishpond with an area of 79,200 sq. m.
was leased to him by the heirs of Primitiva Lejano. Subsequently, defendant became the absolute owner of one
half of the undivided area of the fishpond and he questioned plaintiffs ownership of the other half as void and
fraudulent. As to the area pertaining to plaintiff, defendant claimed that he introduced improvements worth
₱500,000 and being in good faith, he asked that he should be reimbursed by plaintiff. In his pre-trial brief,
however, defendant raised the only issue which is the amount of damages plaintiff is entitled to in the form of
rental. Hence, the thrust of the testimonies of defendant’s witnesses particularly Ben Ruben Camargo and
Marta Fernando Peña was the amount of rental of fishponds in the same locality as the fishpond in question at
a given time. However, the documentary evidence (Exhs. 1 and 2) in support of their testimony were not
offered as evidence.8

The trial court rendered its decision on 8 June 1992, disposing as follows:

WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiff and against the
defendant and hereby orders that:

1. Defendant shall turn over possession to plaintiff one half undivided portion of the 79,200 sq. m.
fishpond who shall enjoy the benefits and fruits in equal share with the defendant effective immediately
until such time that partition of the property is effected;

2. Defendant shall pay to plaintiff the amount of ₱262,500.00 by way of actual or compensatory
damages;

3 Defendant shall pay plaintiff ₱20,000.00 as and for attorney’s fees; and

4. To pay the costs.

SO ORDERED.9

Aggrieved, DE GUIA went to the Court of Appeals insisting the trial court erred in ordering him to vacate and
surrender possession of the ½ undivided portion of the FISHPOND and to pay actual damages and attorney’s
fees. The Court of Appeals found DE GUIA’s appeal without merit and affirmed the trial court’s decision. Upon
DE GUIA’s motion for reconsideration, the appellate court reduced the compensatory damages from ₱262,500
to ₱212,500.

Hence, the instant petition.

The undisputed facts as found by the trial court and adopted in toto by the Court of Appeals are restated as
follows:
1. The subject of the dispute are two undivided parcels of land used as a fishpond situated in Barrio
Ubihan, Meycauayan, Bulacan, originally co-owned by Primitiva Lejano and Lorenza Araniego married
to Juan Abejo.

2. The FISHPOND is registered under the names of Primitiva Lejano and Lorenza Araniego under TCT
No. 6358 of the Bulacan Register of Deeds as follows:

PRIMITIVA LEJANO, Filipina, of legal age, single - ½ share; and LORENZA ARANIEGO, Filipina, of
legal age, married to Juan Abejo, ½ share, ---

3. The FISHPOND has a total land area of approximately 79,220 square meters. ABEJO is seeking to
recover possession of the ½ undivided portion of the FISHPOND containing 39,611 square meters.

4. DE GUIA (along with a certain Aniano Victa) acquired possession of the entire FISHPOND by virtue
of a document captioned Salin ng Pamumusisyong ng Palaisdaan ("Lease Contract") executed
between him and the heirs of Primitiva Lejano. The Lease Contract was effective from 30 July 1974 up
to 30 November 1979 for a consideration of ₱100,000.

5. The Lease Contract was executed with the knowledge and consent of Teofilo Abejo, sole heir of
Lorenza Araniego Abejo. Teofilo Abejo acquired Lorenza Araniego Abejo’s ½ undivided share in the
FISHPOND by intestate succession.

6. Teofilo Abejo (now deceased) sold his ½ undivided share in the FISHPOND to his son, ABEJO, on
22 November 1983.

7. DE GUIA continues to possess the entire FISHPOND and to derive income from the property
despite the expiration of the Lease Contract and several demands to vacate made by Teofilo Abejo
and by his successor-in-interest, ABEJO. The last demand letter was dated 27 November 1983.

8. ABEJO filed his complaint for recovery of possession with damages against DE GUIA on 12 May
1986.

9. DE GUIA’s claim of ownership over the other ½ undivided portion of the FISHPOND has not been
finally adjudicated for or against him.

DE GUIA offers the verified Complaint for Annulment of Real Estate Mortgage and Contract of Lease with
Preliminary Injunction signed by the heirs of Primitiva Lejano as proof of his ownership of the other undivided
half portion of the FISHPOND. Records show that DE GUIA filed the complaint for himself and as attorney-in
fact of the heirs of Primitiva Lejano ("Lejano Heirs") 10 against Spouses Teofilo Morte and Angelina Villarico,
Spouses Ruperto and Milagros Villarico, et al. ("Defendants"). The case was raffled to Branch 12 of the
Regional Trial Court of Malolos, Bulacan, and docketed as Civil Case. No. 86-27-M. The complaint alleged that
DE GUIA acquired his ½ undivided share in the FISHPOND from the Lejano Heirs in February 1986. DE GUIA
and the Lejano Heirs sought to annul the Kasulatan ng Sanglaan and Kasulatan ng Pagbubuwis ng
Palaisdaan, executed on 10 November 1979 by Primitiva Lejano in favor of the Defendants. DE GUIA and the
Lejano Heirs claimed that Primitiva Lejano signed these documents under duress and without consideration.

The trial court rendered judgment11 on 28 February 1992 against DE GUIA and the Lejano Heirs as follows:

WHEREFORE, the evidence having shown the plaintiffs, particularly Manuel De Guia, their successor-in-
interest, not entitled upon the facts and the law to the relief prayed for in the amended complaint, the same is
hereby DISMISSED with costs against said plaintiff. Instead, as prayed for by defendants, judgment is hereby
rendered:
1. – Declaring the "Kasulatan ng Sanglaan" (Exhs. "A" & "1") dated November 10, 1979, and the
"Kasulatan ng Pagbubuwis ng Palaisdaan" (Exhs. "C" &"3") also dated November 10, 1979, as valid
for all legal intents and purposes;

2. – Ordering the Ex-Officio Sheriff, RTC, Bulacan, to proceed with the extrajudicial foreclosure of the
subject real estate mortgage; and

3. – Ordering plaintiffs to pay defendants attorney’s fees in the amount of ₱20,000.00.

SO ORDERED.12

The Court of Appeals affirmed the trial court in a Decision dated 30 August 2002 in CA-G.R. CV No. 38031.
The Court of Appeals found the claim of force and intimidation in the execution of the documents as highly
improbable since Primitiva Lejano’s son, Renato Davis, witnessed the signing of the documents and found
nothing irregular at the time. The appellate court also held that assuming Defendants threatened DE GUIA and
the Lejano Heirs with immediate foreclosure, Defendants were merely exercising their legitimate right of
foreclosing the mortgaged property for non-payment of the loan. In addition, Primitiva Lejano’s lawyer and
notary public, Atty. Mamerto Abaño, testified that the parties appeared before him to affirm the contents of the
documents. He also stated that he was present when Defendants paid Primitiva Lejano Davis and her son
Renato. As of this writing, DE GUIA has a pending motion for reconsideration before the Court of Appeals. In
the event the Court of Appeals’ Decision attains finality, DE GUIA may lose whatever right he claims over the
FISHPOND.

The Trial Court’s Ruling

The trial court ruled that ABEJO has the right to demand that DE GUIA vacate and surrender an area
equivalent to ABEJO’s ½ undivided share in the FISHPOND. The trial court explained that DE GUIA’s sublease
contract expired in 1979 and ABEJO acquired his father’s share in 1983. However, the trial court pointed out
that ABEJO failed to present evidence of the judicial or extra-judicial partition of the FISHPOND. The
identification of the specific area pertaining to ABEJO and his co-owner is vital in an action to recover
possession of real property. Nevertheless, the trial court declared that pending partition, it is only just that DE
GUIA pay ABEJO a reasonable amount as rental for the use of ABEJO’s share in the FISHPOND. DE GUIA
admitted this obligation when he raised as sole issue in his pre-trial brief how much rent he should pay ABEJO.
DE GUIA even proposed ₱300,000 as the reasonable amount but under certain conditions which ABEJO found
unacceptable.

In determining the reasonable rent due to ABEJO, the trial court considered the Lease Contract between
ABEJO and a certain Ruperto C. Villarico which provided for a yearly rent of ₱25,000 for ½ undivided portion of
the FISHPOND. The trial court declared that the total amount of rent due is ₱212,500, computed from
November 1983 when ABEJO became a co-owner of the FISHPOND up to 199113 or a period of eight and one
half years. The trial court further ordered DE GUIA to pay an additional ₱50,000 which represents the amount
ABEJO returned to Ruperto C. Villarico when they cancelled the Lease Contract between them due to DE
GUIA’s refusal to vacate the FISHPOND.

Lastly, the trial court ruled that pending partition, ABEJO as co-owner has the right to possess the FISHPOND
and to receive an equal share in the benefits from the FISHPOND effective immediately. Until there is a
partition, and while there is no contract of lease, the Civil Code provisions on co-ownership shall govern the
rights of the parties.

The Court of Appeals’ Ruling

The Court of Appeals affirmed the trial court’s decision. The Court of Appeals debunked DE GUIA’s claim that
partition and not recovery of possession was the proper remedy under the circumstances. The Court of
Appeals pointed out that DE GUIA’s failure to respect ABEJO’s right over his ½ undivided share in the
FISHPOND justifies the action for recovery of possession. The trial court’s decision effectively enforces
ABEJO’s right over the property which DE GUIA violated by possession and use without paying compensation.
According to the Court of Appeals, partition would constitute a mechanical aspect of the decision just like
accounting when necessary.

The Court of Appeals likewise rejected DE GUIA’s claim that the award of compensatory damages of
₱242,000, computed based on the rent stipulated in the Lease Contract between ABEJO and Ruperto C.
Villarico, is grossly exorbitant. The Court of Appeals clarified that the amount the trial court awarded was
₱262,500 and not ₱242,000 as erroneously alleged by DE GUIA. The Court of Appeals pointed out that the
notarized Lease Contract between ABEJO and Ruperto C. Villarico carries more evidentiary weight than the
testimonies of DE GUIA’s witnesses, Ben Ruben Camargo and Marta Fernando Peña. The Court of Appeals
also upheld the award of attorney’s fees since the parties could have avoided litigation had DE GUIA heeded
the justifiable demands of ABEJO.

On motion for reconsideration, the Court of Appeals reduced the compensatory damages from ₱262,500 to
₱212,500. The Court of Appeals explained that the trial court correctly computed the total amount of rent due at
₱212,500. The trial court erred, however, in adding the sum of ₱50,000 representing the rent for 1983 and
1984 which ABEJO returned to Ruperto C. Villarico. The appellate court clarified that the sum of ₱212,500 was
arrived at by multiplying the rent of ₱25,000 by 8½ years. The 8½ year period already included the two months
rent received from and then subsequently reimbursed to Ruperto C. Villarico.

The Issues

DE GUIA raises the following issues in his Memorandum:

I.

THE COURT OF APPEALS ERRED IN AFFIRMING THE TRIAL COURT’S DECISION DENYING
PETITIONER’S PLEA FOR DISMISSAL OF THE COMPLAINT FOR FAILURE TO STATE A CAUSE OF
ACTION;

II.

THE COURT OF APPEALS ERRED IN AFFIRMING THE TRIAL COURT’S ORDER DIRECTING PETITIONER
TO TURN OVER THE ONE-HALF UNDIVIDED PORTION OF THE FISHPOND WHICH IS STILL UNDER A
STATE OF CO-OWNERSHIP;

III.

THE COURT OF APPEALS ERRED IN AFFIRMING, IN PART, THE AWARD OF ACTUAL OR


COMPENSATORY DAMAGES DESPITE LACK OF CREDIBLE EVIDENCE TO SUPPORT THE SAME;

IV.

THE COURT OF APPEALS ERRED IN AFFIRMING THE AWARD OF ATTORNEY’S FEES IN PRIVATE
RESPONDENT’S FAVOR.14

In essence, this Court is asked to resolve: (1) whether an action for recovery of possession and turn-over of the
½ undivided portion of a common property is proper before partition; and (2) whether there is sufficient basis for
the award of compensatory damages and attorney’s fees.

The Court’s Ruling

The petition is partly meritorious.

First and Second Issues: Cause of Action and Turn-Over of Possession


DE GUIA contends that a co-owner cannot claim a definite portion from the property owned in common until
there is a partition. DE GUIA argues that ABEJO should have filed an action for partition instead of recovery of
possession since the court cannot implement any decision in the latter case without first a partition. DE GUIA
contends that an action for recovery of possession cannot prosper when the property subject of the action is
part of an undivided, co-owned property. The procedural mode adopted by ABEJO, which is recovery of
possession, makes enforcement difficult if not impossible since there is still no partition of the subject property.

Under Article 484 of the Civil Code, "there is co-ownership whenever the ownership of an undivided thing or
right belongs to different persons." A co-owner of an undivided parcel of land is an "owner of the whole, and
over the whole he exercises the right of dominion, but he is at the same time the owner of a portion which is
truly abstract."15On the other hand, there is no co-ownership when the different portions owned by different
people are already concretely determined and separately identifiable, even if not yet technically described. 16

Article 487 of the Civil Code provides, "[a]ny one of the co-owners may bring an action in ejectment." This
article covers all kinds of actions for the recovery of possession. Article 487 includes forcible entry and unlawful
detainer (accion interdictal), recovery of possession (accion publiciana), and recovery of ownership (accion de
reivindicacion). The summary actions of forcible entry and unlawful detainer seek the recovery of physical
possession only. These actions are brought before municipal trial courts within one year from dispossession.
However, accion publiciana, which is a plenary action for recovery of the right to possess, falls under the
jurisdiction of the proper regional trial court when the dispossession has lasted for more than one year. Accion
de reivindicacion, which seeks the recovery of ownership, also falls under the jurisdiction of the proper regional
trial court.17
1aw phi 1.nét

Any co-owner may file an action under Article 487 not only against a third person, but also against
another co-owner who takes exclusive possession and asserts exclusive ownership of the property. 18 In
the latter case, however, the only purpose of the action is to obtain recognition of the co-ownership. The
plaintiff cannot seek exclusion of the defendant from the property because as co-owner he has a right of
possession. The plaintiff cannot recover any material or determinate part of the property.19

In Hermogena G. Engreso with Spouse Jose Engreso v. Nestoria De La Cruz and Herminio De La
Cruz,20 we reiterated the rule that a co-owner cannot recover a material or determinate part of a common
property prior to partition as follows:

It is a basic principle in civil law that before a property owned in common is actually partitioned, all that the co-
owner has is an ideal or abstract quota or proportionate share in the entire property. A co-owner has no right to
demand a concrete, specific or determinate part of the thing owned in common because until division is
effected his right over the thing is represented only by an ideal portion.

As such, the only effect of an action brought by a co-owner against a co-owner will be to obtain recognition of
the co-ownership; the defendant cannot be excluded from a specific portion of the property because as a co-
owner he has a right to possess and the plaintiff cannot recover any material or determinate part of the
property. Thus, the courts a quo erred when they ordered the delivery of one-half (½) of the building in favor of
private respondent.

Indisputably, DE GUIA has been in exclusive possession of the entire FISHPOND since July 1974. Initially, DE
GUIA disputed ABEJO’s claim of ownership over the ½ undivided portion of the FISHPOND. Subsequently, he
implicitly recognized ABEJO’s ½ undivided share by offering to settle the case for ₱300,000 and to vacate the
property. During the trial proper, neither DE GUIA nor ABEJO asserted or manifested a claim of absolute and
exclusive ownership over the entire FISHPOND. Before this Court, DE GUIA limits the issues to the propriety
1a\^/phi 1.net

of bringing an action for recovery of possession and the recovery of compensatory damages.

Following the inherent and peculiar features of co-ownership, while ABEJO and DE GUIA have equal shares in
the FISHPOND quantitatively speaking, they have the same right in a qualitative sense as co-owners. Simply
stated, ABEJO and DE GUIA are owners of the whole and over the whole, they exercise the right of dominion.
However, they are at the same time individual owners of a ½ portion, which is truly abstract because until there
is partition, such portion remains indeterminate or unidentified.21 As co-owners, ABEJO and DE GUIA may
jointly exercise the right of dominion over the entire FISHPOND until they partition the FISHPOND by
identifying or segregating their respective portions.

Since a co-ownership subsists between ABEJO and DE GUIA, judicial or extra-judicial partition is the proper
recourse. An action to demand partition is imprescriptible and not subject to laches. 22 Each co-owner may
demand at any time the partition of the common property unless a co-owner has repudiated the co-ownership
under certain conditions.23 Neither ABEJO nor DE GUIA has repudiated the co-ownership under the conditions
set by law.

To recapitulate, we rule that a co-owner may file an action for recovery of possession against a co-owner who
takes exclusive possession of the entire co-owned property. However, the only effect of such action is a
recognition of the co-ownership. The courts cannot proceed with the actual partitioning of the co-owned
property. Thus, judicial or extra-judicial partition is necessary to effect physical division of the FISHPOND
between ABEJO and DE GUIA. An action for partition is also the proper forum for accounting the profits
received by DE GUIA from the FISHPOND. However, as a necessary consequence of such recognition,
ABEJO shall exercise an equal right to possess, use and enjoy the entire FISHPOND.

DE GUIA further claims that the trial and appellate courts erred when they ordered the recovery of rent when
the exact identity of the portion in question had not yet been clearly defined and delineated. According to DE
GUIA, an order to pay damages in the form of rent is premature before partition.

We disagree.

The right of enjoyment by each co-owner is limited by a similar right of the other co-owners. A co-owner cannot
devote common property to his exclusive use to the prejudice of the co-ownership.24 Hence, if the subject is a
residential house, all the co-owners may live there with their respective families to the extent possible.
However, if one co-owner alone occupies the entire house without opposition from the other co-owners, and
there is no lease agreement, the other co-owners cannot demand the payment of rent. Conversely, if there is
an agreement to lease the house, the co-owners can demand rent from the co-owner who dwells in the
house.

The co-owners can either exercise an equal right to live in the house, or agree to lease it. If they fail to exercise
any of these options, they must bear the consequences. It would be unjust to require the co-owner to pay rent
after the co-owners by their silence have allowed him to use the property.25

In case the co-owners agree to lease a building owned in common, a co-owner cannot retain it for his use
without paying the proper rent.26 Moreover, where part of the property is occupied exclusively by some co-
owners for the exploitation of an industry, the other co-owners become co-participants in the accessions of the
property and should share in its net profits.27

The Lejano Heirs and Teofilo Abejo agreed to lease the entire FISHPOND to DE GUIA. After DE GUIA’s lease
expired in 1979, he could no longer use the entire FISHPOND without paying rent. To allow DE GUIA to
continue using the entire FISHPOND without paying rent would prejudice ABEJO’s right to receive rent, which
would have accrued to his ½ share in the FISHPOND had it been leased to others.28 Since ABEJO acquired his
½ undivided share in the FISHPOND on 22 November 1983, DE GUIA should pay ABEJO reasonable rent for
his possession and use of ABEJO’s portion beginning from that date. The compensatory damages of ₱25,000
per year awarded to ABEJO is the fair rental value or the reasonable compensation for the use and occupation
of the leased property,29considering the circumstances at that time. DE GUIA shall continue to pay ABEJO a
yearly rent of ₱25,000 corresponding to ABEJO’s ½ undivided share in the FISHPOND. However, ABEJO has
the option either to exercise an equal right to occupy the FISHPOND, or to file a new petition before the trial
court to fix a new rental rate in view of changed circumstances in the last 20 years. 1a\^ /phi1.net

ABEJO made an extrajudicial demand on DE GUIA by sending the 27 November 1983 demand letter. Thus,
the rent in arrears should earn interest at 6% per annum from 27 November 1983 until finality of this decision
pursuant to Article 220930 of the Civil Code. Thereafter, the interest rate is 12% per annum from finality of this
decision until full payment.31
Third Issue: Lack of Credible Evidence to Support Award of Compensatory Damages

DE GUIA contends the ₱212,500 in rent awarded to ABEJO is exorbitant. He assails as doubtful and self-
serving evidence the Lease Contract between ABEJO and Ruperto C. Villarico that served as basis for the
yearly rent of ₱25,000 for ABEJO’s share in the FISHPOND.

DE GUIA says the trial and appellate courts should have given credence to the testimonies of his witnesses,
Ben Ruben Camargo ("Camargo") and Marta Fernando Peña ("Peña") that rentals of fishponds in the same
vicinity are for much lesser considerations.

This issue involves calibration of the whole evidence considering mainly the credibility of witnesses. As a rule, a
party may raise only questions of law in an appeal by certiorari under Rule 45 of the Rules of Court. The
Supreme Court is not duty-bound to analyze and weigh again the evidence considered in the proceedings
below.32 More so in the instant case, where the Court of Appeals affirmed the factual findings of the trial court. 33

It is not true that the trial court disregarded the testimonies of Camargo and Peña because DE GUIA failed to
present documentary evidence to support their testimonies. Actually, the trial and appellate courts found the
testimonies of Camargo and Peña unconvincing. Judges cannot be expected to rely on the testimonies of every
witness. In ascertaining the facts, they determine who are credible and who are not. In doing so, they consider
all the evidence before them.34

We find no cogent reason to overturn the trial and appellate courts’ evaluation of the witnesses’ testimonies.
We likewise find reasonable the ₱25,000 yearly compensation for ABEJO’s ½ undivided share in the
FISHPOND. Indeed, being a question of fact, it is for the trial and appellate courts to decide and this Court will
not disturb their findings unless clearly baseless or irrational. The exception does not obtain in this case.

Fourth Issue: Attorney’s Fees

The trial court did not err in imposing attorney’s fees of ₱20,000. Attorney’s fees can be awarded in the cases
enumerated in Article 2208 of the Civil Code specifically:

xxx

(2) Where the defendant’s act or omission has compelled the plaintiff to litigate with third persons or to incur
expenses to protect his interest;

xxx

DE GUIA is a lawyer and he should have known that a co-owner could not take exclusive possession of a
common property. Although DE GUIA offered to settle the case out of court, such offer was made under
conditions not acceptable to ABEJO. Certainly, ABEJO was still put to unnecessary expense and trouble to
protect his interest under paragraph (2), Article 2208 of the Civil Code.

WHEREFORE, the Decision dated 22 August 1994 and Resolution dated 27 June 1995 of the Court of Appeals
in CA-G.R. CV No. 39875 is AFFIRMED with respect to that portion ordering Manuel T. De Guia to pay Jose B.
Abejo compensatory damages of ₱212,500 and attorney’s fees of ₱20,000, and MODIFIED as follows:

1. The co-ownership between Manuel T. De Guia and Jose B. Abejo over the entire FISHPOND
covered by TCT No. 6358 of the Bulacan Register of Deeds is recognized without prejudice to the
outcome of CA–G.R. CV No. 38031 pending before the Court of Appeals and other cases involving the
same property;

2. Manuel T. De Guia and Jose B. Abejo shall equally enjoy possession and use of the entire
FISHPOND prior to partition;
3. The compensatory damages of ₱25,000 per annum representing rent from 27 November 1983 until
May 1992 shall earn interest at 6% per annum from 27 November 1983 until finality of this decision,
and thereafter at 12% per annum until full payment;

4. Manuel T. de Guia shall pay Jose B. Abejo a yearly rent of ₱25,000 from June 1992 until finality of
this decision, with interest at 6% per annum during the same period, and thereafter at 12% interest per
annum until full payment;

5. After finality of this decision and for as long as Manuel T. de Guia exclusively possesses the entire
FISHPOND, he shall pay Jose B. Abejo a yearly rental of ₱25,000 for the latter’s ½ undivided share in
the FISHPOND, unless Jose B. Abejo secures from the proper court an order fixing a different rental
rate in view of possible changed circumstances.
G.R. No. 61584 November 25, 1992

DONATO S. PAULMITAN, JULIANA P. FANESA and RODOLFO FANESA, petitioners,


vs.
COURT OF APPEALS, ALICIO PAULMITAN, ELENA PAULMITAN, ABELINO PAULMITAN, ANITA
PAULMITAN, BAKING PAULMITAN, ADELINA PAULMITAN and ANITO PAULMITAN, respondents.

ROMERO, J.:

This is a petition for review on certiorari seeking the reversal of the decision 1 of the Court of Appeals, dated
July 14, 1982 in CA-G.R. No. 62255-R entitled "Alicio Paulmitan, et al. v. Donato Sagario Paulmitan, et al."
which affirmed the decision 2 of the then Court of First Instance (now RTC) of Negros Occidental, 12th Judicial
District, Branch IV, Bacolod City, in Civil Case No. 11770.

The antecedent facts are as follows:

Agatona Sagario Paulmitan, who died sometime in 1953, 3 left the two following parcels of land located in the
Province of Negros Occidental: (1) Lot No. 757 with an area of 1,946 square meters covered by Original
Certificate of Title (OCT) No. RO-8376; and (2) Lot No. 1091 with an area of 69,080 square meters and
covered by OCT No. RO-11653. From her marriage with Ciriaco Paulmitan, who is also now deceased,
Agatona begot two legitimate children, namely: Pascual Paulmitan, who also died in 1953, 4 apparently shortly
after his mother passed away, and Donato Paulmitan, who is one of the petitioners. Petitioner Juliana P.
Fanesa is Donato's daughter while the third petitioner, Rodolfo Fanes, is Juliana's husband. Pascual
Paulmitan, the other son of Agatona Sagario, is survived by the respondents, who are his children, name:
Alicio, Elena, Abelino, Adelina, Anita, Baking and Anito, all surnamed Paulmitan.

Until 1963, the estate of Agatona Sagario Paulmitan remained unsettled and the titles to the two lots mentioned
above remained in the name of Agatona. However, on August 11, 1963, petitioner Donato Paulmitan executed
an Affidavit of Declaration of Heirship, extrajudicially adjudicating unto himself Lot No. 757 based on the claim
that he is the only surviving heir of Agatona Sagario. The affidavit was filed with the Register of Deeds of
Negros Occidental on August 20, 1963, cancelled OCT No. RO-8376 in the name of Agatona Sagario and
issued Transfer Certificate of Title (TCT) No. 35979 in Donato's name.

As regards Lot No. 1091, Donato executed on May 28, 1974 a Deed of Sale over the same in favor of petitioner
Juliana P. Fanesa, his daughter. 5

In the meantime, sometime in 1952, for non-payment of taxes, Lot No. 1091 was forfeited and sold at a public
auction, with the Provincial Government of Negros Occidental being the buyer. A Certificate of Sale over the
land was executed by the Provincial Treasurer in favor of the Provincial Board of Negros Occidental. 6

On May 29, 1974, Juliana P. Fanesa redeemed the property from the Provincial Government of Negros
Occidental for the amount of P2,959.09. 7

On learning of these transactions, respondents children of the late Pascual Paulmitan filed on January 18, 1975
with the Court of First Instance of Negros Occidental a Complaint against petitioners to partition the properties
plus damages.

Petitioners set up the defense of prescription with respect to Lot No. 757 as an affirmative defense, contending
that the Complaint was filed more than eleven years after the issuance of a transfer certificate of title to Donato
Paulmitan over the land as consequence of the registration with the Register of Deeds, of Donato's affidavit
extrajudicially adjudicating unto himself Lot No. 757. As regards Lot No. 1091, petitioner Juliana P. Fanesa
claimed in her Answer to the Complaint that she acquired exclusive ownership thereof not only by means of a
deed of sale executed in her favor by her father, petitioner Donato Paulmitan, but also by way of redemption
from the Provincial Government of Negros Occidental.

Acting on the petitioners' affirmative defense of prescription with respect to Lot No. 757, the trial court issued
an order dated April 22, 1976 dismissing the complaint as to the said property upon finding merit in petitioners'
affirmative defense. This order, which is not the object of the present petition, has become final after
respondents' failure to appeal therefrom.

Trial proceeded with respect to Lot No. 1091. In a decision dated May 20, 1977, the trial court decided in favor
of respondents as to Lot No. 1091. According to the trial court, the respondents, as descendants of Agatona
Sagario Paulmitan were entitled to one-half (1/2) of Lot No. 1091, pro indiviso. The sale by petitioner Donato
Paulmitan to his daughter, petitioner Juliana P. Fanesa, did not prejudice their rights. And the repurchase by
Juliana P. Fanesa of the land from the Provincial Government of Negros Occidental did not vest in Juliana
exclusive ownership over the entire land but only gave her the right to be reimbursed for the amount paid to
redeem the property. The trial court ordered the partition of the land and directed petitioners Donato Paulmitan
and Juliana P. Fanesa to pay private respondents certain amounts representing the latter's share in the fruits of
the land. On the other hand, respondents were directed to pay P1,479.55 to Juliana P. Fanesa as their share in
the redemption price paid by Fanesa to the Provincial Government of Negros Occidental. The dispositive
portion of the trial court's decision reads:

WHEREFORE, judgment is hereby rendered on the second cause of action pleaded in the
complain as follows:

1. The deed of sale (Exh. "F") dated May 28, 1974 is valid insofar as the one-half undivided
portion of Lot 1091 is concerned as to vest ownership over said half portion in favor of
defendant Juliana Fanesa and her husband Rodolfo Fanesa, while the remaining half shall
belong to plaintiffs, pro-indiviso;

2. Lot 1091, Cadastral Survey of Pontevedra, Province of Negros Occidental, now covered by
TCT No. RO-11653 (N.A.), is ordered partitioned. The parties must proceed to an actual
partition by property instrument of partition, submitting the corresponding subdivision within
sixty (60) days from finality of this decision, and should they fail to agree, commissioners of
partition may be appointed by the Court;

3. Pending the physical partition, the Register of Deeds of Negros Occidental is ordered to
cancel Original Certificate of Title No. RO-11653 (N.A.) covering Lot 1091, Pontevedra
Cadastre, and to issue in lieu thereof a new certificate of title in the name of plaintiffs and
defendants, one-half portion each,pro-indiviso, as indicated in paragraph 1 above;

4. Plaintiffs are ordered to pay, jointly and severally, defendant Juliana Fanesa the amount of
P1,479.55 with interest at the legal rate from May 28, 1974 until paid;

5 Defendants Donato Sagario Paulmitan and Juliana Paulmitan Fanesa are ordered to
account to plaintiffs and to pay them, jointly and severally, the value of the produce from Lot
1091 representing plaintiffs' share in the amount of P5,000.00 per year from 1966 up to the
time of actual partition of the property, and to pay them the sum of P2,000.00 as attorney's
fees as well as the costs of the suit.

xxx xxx xxx

On appeal, the Court of Appeals affirmed the trial court's decision. Hence this petition.

To determine the rights and obligations of the parties to the land in question, it is well to review, initially, the
relatives who survived the decedent Agatona Sagario Paulmitan. When Agatona died in 1953, she was
survived by two (2) sons, Donato and Pascual. A few months later in the same year, Pascual died, leaving
seven children, the private respondents. On the other had, Donato's sole offspring was petitioner Juliana P.
Fanesa.

At the time of the relevant transactions over the properties of decedent Agatona Sagario Paulmitan, her son
Pascual had died, survived by respondents, his children. It is, thus, tempting to apply the principles pertaining
to the right of representation as regards respondents. It must, however, be borne in mind that Pascual did no
predecease his mother, 8 thus precluding the operation of the provisions in the Civil Code on the right of representation 9 with respect
to his children, the respondents. When Agatona Sagario Paulmitan died intestate in 1952, her two (2) sons Donato and Pascual were still
alive. Since it is well-settled by virtue of Article 777 of the Civil Code that "[t]he rights to the succession are transmitted from the moment of
the death of the decedent," 10 the right of ownership, not only of Donato but also of Pascual, over their respective shares in the inheritance
was automatically and by operation of law vested in them in 1953 when their mother died intestate. At that stage, the children of Donato and
Pascual did not yet have any right over the inheritance since "[i]n every inheritance, the relative nearest in degree excludes the more distant
ones." 11 Donato and Pascual excluded their children as to the right to inherit from Agatona Sagario Paulmitan, their mother.

From the time of the death of Agatona Sagario Paulmitan to the subsequent passing away of her son Pascual
in 1953, the estate remained unpartitioned. Article 1078 of the Civil Code provides: "Where there are two or
more heirs, the whole estate of the decedent is, before its partition, owned in common by such heirs, subject to
the payment of debts of the deceased." 12 Donato and Pascual Paulmitan were, therefore, co-owners of the
estate left by their mother as no partition was ever made.

When Pascual Paulmitan died intestate in 1953, his children, the respondents, succeeded him in the co-
ownership of the disputed property. Pascual Paulmitan's right of ownership over an undivided portion of the
property passed on to his children, who, from the time of Pascual's death, became co-owners with their uncle
Donato over the disputed decedent estate.

Petitioner Juliana P. Fanesa claims ownership over Lot No. 1091 by virtue of two transactions, namely: (a) the
sale made in her favor by her father Donato Paulmitan; and (b) her redemption of the land from the Provincial
of Negros Occidental after it was forfeited for non-payment of taxes.

When Donato Paulmitan sold on May 28, 1974 Lot No. 1091 to his daughter Juliana P. Fanesa, he was only a
co-owner with respondents and as such, he could only sell that portion which may be allotted to him upon
termination of the co-ownership. 13 The sale did not prejudice the rights of respondents to one half (1/2)
undivided share of the land which they inherited from their father. It did not vest ownership in the entire land
with the buyer but transferred only the seller's pro-indiviso share in the property 14 and consequently made the
buyer a co-owner of the land until it is partitioned. In Bailon-Casilao v. Court of Appeals, 15 the Court, through
Justice Irene R. Cortes, outlined the effects of a sale by one co-owner without the consent of all the co-owners,
thus:

The rights of a co-owner of a certain property are clearly specified in Article 493 of the Civil
Code, Thus:

Art. 493. Each co-owner shall have the full ownership of his part and of the fruits and benefits
pertaining thereto, and he may therefore alienate, assign or mortgage it and even substitute
another person its enjoyment, except when personal rights are involved. But the effect of the
alienation or mortgage, with respect to the co-owners, shall be limited to the portion which
may be allotted to him in the division upon the termination of the co-ownership. [Emphasis
supplied.]

As early as 1923, this Court has ruled that even if a co-owner sells the whole property as his,
the sale will affect only his own share but not those of the other co-owners who did not
consent to the sale [Punsalan v. Boon Liat, 44 Phil. 320 (1923)]. This is because under the
aforementioned codal provision, the sale or other disposition affects only his undivided share
and the transferee gets only what would correspond to his grantor in the partition of the thing
owned in common [Ramirez v. Bautista, 14 Phil. 528 (1909)]. Consequently, by virtue of the
sales made by Rosalia and Gaudencio Bailon which are valid with respect to their
proportionate shares, and the subsequent transfers which culminated in the sale to private
respondent Celestino Afable, the said Afable thereby became a co-owner of the disputed
parcel of land as correctly held by the lower court since the sales produced the effect of
substituting the buyers in the enjoyment thereof [Mainit v. Bandoy, 14 Phil. 730 (1910)].

From the foregoing, it may be deduced that since a co-owner is entitled to sell his undivided
share, a sale of the entire property by one co-owner without the consent of the other co-
owners is not null and void. However, only the rights of the co-owner-seller are transferred,
thereby making the buyer a co-owner of the property.

Applying this principle to the case at bar, the sale by petitioner Donato Paulmitan of the land to his daughter,
petitioner Juliana P. Fanesa, did not give to the latter ownership over the entire land but merely transferred to
her the one half (1/2) undivided share of her father, thus making her the co-owner of the land in question with
the respondents, her first cousins.

Petitioner Juliana P. Fanesa also claims ownership of the entire property by virtue of the fact that when the
Provincial Government of Negros Occidental bought the land after it was forfeited for non-payment of taxes,
she redeemed it.

The contention is without merit.

The redemption of the land made by Fanesa did not terminate the co-ownership nor give her title to the entire
land subject of the co-ownership. Speaking on the same issue raised by petitioners, the Court, in Adille v. Court
of Appeals, 16 resolved the same with the following pronouncements:

The petition raises a purely legal issue: May a co-owner acquire exclusive ownership over the
property held in common?

Essentially, it is the petitioners' contention that the property subject of dispute devolved upon
him upon the failure of his co-heirs to join him in its redemption within the period required by
law. He relies on the provisions of Article 1515 of the old Civil Code, Article 1613 of the
present Code, giving the vendee a retro the right to demand redemption of the entire property.

There is no merit in this petition.

The right of repurchase may be exercised by co-owner with respect to his share alone (CIVIL
CODE, art. 1612, CIVIL CODE (1889), art. (1514.). While the records show that petitioner
redeemed the property in its entirety, shouldering the expenses therefor, that did not make
him the owner of all of it. In other words, it did not put to end the existing state of co-ownership
(Supra, Art. 489). There is no doubt that redemption of property entails a necessary expense.
Under the Civil Code:

Art. 488. Each co-owner shall have a right to compel the other co-owners to contribute to the
expenses of preservation of the thing or right owned in common and to the taxes. Any one of
the latter may exempt himself from this obligation by renouncing so much of his undivided
interest as may be equivalent to his share of the expenses and taxes. No such waiver shall be
made if it is prejudicial to the co-ownership.

The result is that the property remains to be in a condition of co-ownership. While a vendee a
retro, under Article 1613 of the Code, "may not be compelled to consent to a partial
redemption," the redemption by one co-heir or co-owner of the property in its totality does not
vest in him ownership over it. Failure on the part of all the co-owners to redeem it entitles the
vendee a retro to retain the property and consolidate title thereto in his name (Supra, art.
1607). But the provision does not give to the redeeming co-owner the right to the entire
property. It does not provide for a mode of terminating a co-ownership.
Although petitioner Fanesa did not acquire ownership over the entire lot by virtue of the redemption she made,
nevertheless, she did acquire the right to reimbursed for half of the redemption price she paid to the Provincial
Government of Negros Occidental on behalf of her co-owners. Until reimbursed, Fanesa hold a lien upon the
subject property for the amount due her. 17

Finally, petitioners dispute the order of the trial court, which the Court of Appeals affirmed, for them to pay
private respondents P5,000.00 per year from 1966 until the partition of the estate which represents the share of
private respondents in the fruits of the land. According to petitioners, the land is being leased for P2,000.00 per
year only. This assigned error, however raises a factual question. The settled rule is that only questions of law
may be raised in a petition for review. As a general rule, findings of fact made by the trial court and the Court of
Appeals are final and conclusive and cannot be reviewed on appeal. 18

WHEREFORE, the petition is DENIED and the decision of the Court of Appeals AFFIRMED.
G.R. No. L-44664 July 31, 1991

BERNARDO MENDOZA I, BERNARDO MENDOZA II, GUADALUPE M. MANGALE, JULIANA M.


SAMONTE, PACITA M. SAMONTE, RICARDO MENDOZA, FRANCISCO MENDOZA, PATRICIA MENDOZA,
OLYMPIA M. DIZON, ROMEO MENDOZA, REYNALDO MENDOZA, REMEDIOS M. BERNABE and
TRINIDAD MANUEL MENDOZA, petitioners,
vs.
HON. COURT OF APPEALS, RENATO SAMONTE and LUCIA DELA CRUZ SAMONTE, respondents.

Rosendo G. Tansinsin, Jr. for petitioners.


Francisco E. Rodrigo, Jr. for respondents.

MEDIALDEA, J.:

This is a petition for review on certiorari seeking to nullify the decision of the Court of Appeals dated June 23,
1976, in C.A G.R. No. 56049-R entitled "Bernardo Mendoza I, et al. v. Renato Samonte, et al.," which affirmed
the decision of the Court of First Instance of Bulacan; and its resolution dated September 15, 1976, which
denied the motion for reconsideration.

The antecedent facts are, as follows:

On February 18, 1969, petitioners Bernardo Mendoza I, Bernardo Mendoza II, Guadalupe M. Mangale, Juliana
M. Samonte, Pacita M. Samonte, Ricardo Mendoza, Francisco Mendoza, Patricia Mendoza, Olympia M. Dizon,
Romeo Mendoza, Reynaldo Mendoza, Remedios M. Bernabe and Trinidad Manuel Mendoza instituted before
the Court of First Instance of Bulacan an action for reconveyance of real property against private respondents
spouses Renato Samonte and Lucia de la Cruz Samonte. On October 27, 1970, petitioners filed a First
Amended Complaint wherein they alleged that in the event that the sale of the real property by petitioner
Trinidad Manuel Mendoza to private respondents is declared valid, they are nonetheless entitled to legal
redemption.

During the pre-trial on June 28, 1971, the parties, through their respective counsel, submitted the following
partial stipulation of facts (pp. 48-51, Record on Appeal):

xxx xxx xxx

1. Plaintiffs are the legal heirs of the late Arcadio Mendoza of Barrio Taliptip, Bulacan, Bulacan; plaintiff
Trinidad Manuel being the surviving spouse of said Arcadio Mendoza and the rest of the plaintiffs
being the legitimate children of spouses Arcadio Mendoza (deceased) and Trinidad Manuel;

2. Arcadio Mendoza and Trinidad Manuel were married on April 22, 1923, in the Catholic Church,
Parish of Bulacan, Bulacan;

3. Areadio Mendoza died in the Barrio of Taliptip, Bulacan, Bulacan, on November 4, 1944;

4. The late Arcadio Mendoza left properties, real and personal, among which is the property covered
by Original Certificate of Title No. 12192 of the Register of Deeds of Bulacan, situated at Taliptip,
Bulacan, Bulacan, consisting of nine (9) parcels of land, with an aggregate area of 33,398 square
meters; . . .;

5. The property in question is Lot 3-A, which is a portion of Lot 3, which Lot 3-A is more particularly
described as follows:
(A parcel of land (Lot 3-A of the subdivision plan (LRC) Psd17370, being a portion of Lot 3,
described on plan Psu-51078, LRC (GLRO) Record No. 32994), situated in the Barrio of
Taliptip, Municipality of Bulacan, Province of Bulacan. Bounded on the NE., points 1 to 2 by
(Lot 8, Psu-51078, Road Widening) Bulacan-Obando Provincial Road (15-00 m. wide); on the
SE., points 2 to 3 by property of Faustino Samonte; on the SW., points 3 to 4 by property of
Faustino Samonte; and on the NW., points 4 to 1 by Lot 3-B of the Subdivision plan.
Beginning at a point marked "1" on plan, being S, 30 deg. 52'E., 3794.82 m. from BLLM 1,
Mp. of Bulacan,

thence S. 49 deg. 38'E., 46.93 m. to point 2;

thence S. 42 deg. 21 'W 49.94 m. to point 3;

thence N. 43 deg. 47'W., 47.33 m. to point 4;

thence N. 42 deg. 46'E., 45.14 m. to the point

of beginning containing an area of TWO THOUSAND TWO HUNDRED AND THIRTY EIGHT
(2,238) SQUARE METERS, more or less. All points referred to are indicated on the plan and
are marked on the ground as follows: points 1 and 4 by PS. Cyl. Conc. Mons. 15 x 60 cm.,
and the rest of Old PLS. Stone Mons. 20x20x60 cm., bearings true; declination O deg. 48'E
date of the original survey, April 27, 1926 and that of the subdivision survey, July 21, 1961.

6. Arcadio Mendoza acquired ownership over the above-mentioned nine (9) parcels of land, including
Lot 3, through donation from the late Jose Samonte, which mode of acquisition was recognized and
adjudicated by the Court of Appeals in its decision dated September 23, 1964, in the case entitled
"Victor Samonte, et al. v. Maria Samonte, et al."; GR No. 22891-R; . . .;

7. In the case decided by the Court of Appeals, CA-G.R. No. 22891-R the plaintiffs were:

VICTOR SAMONTE, AGATONA SAMONTE, ARTEMIO VILLANUEVA, CELESTINO


VILLANUEVA, RAMON VILLANUEVA, MERCEDES VILLANUEVA, SANTOS VILLANUEVA,
MAXIMO VILLANUEVA, ALIPIO VILLANUEVA, SIXTO DE LOS REYES, JOSE DE LOS
REYES, LIGAYA DE LOS REYES, ELINO VILLANUEVA, CRISANTA VILLANUEVA, PEDRO
VILLANUEVA, NICOLAS VILLANUEVA, ARSENIO VILLANUEVA, BALTAZAR VILLANUEVA,
OTILLA VILLANUEVA, ENRIQUE VILLANUEVA, JOSE VILLANUEVA, ROLANDO
VILLANUEVA, MARTA MENDOZA, MARIA MENDOZA, FELIPA VILLENA, ADELA ANDAYA,
and MATIAS VILLANUEVA. (sic)

while the defendants were:

FAUSTINO SAMONTE, MARIA SAMONTE, BERNARDO MENDOZA, GUADALUPE M. VDA.


DE MANGALI, JULIANA MENDOZA, RAUL SAMONTE, BERNARDO MENDOZA II,
RICARDO MENDOZA, FRANCISCO MENDOZA, PACITA MENDOZA, CAYETANO
SAMONTE and TRINIDAD MANUEL, in her own right and as guardian-ad-litem for the
minors, OLIMPIA, PATRICIA, REYNALDO, REMEDIOS and ROMEO all surnamed
MENDOZA;

8. The aforementioned Lot 3 was subsequently subdivided into two (2) lots, namely: Lot 3-A with an
area of 2238 square meters and Lot 3-B with an area of 2115 square meters, as shown in the
Subdivision plan (LRC) Psd-17370, dated September 7, 1961, duly approved by the Commissioner of
Land Registration, Antonio Noblejas;

9. One June 26,1962, plaintiff Trinidad Manuel Mendoza sold to defendants, Renato Samonte and
Lucia de la Cruz Samonte, Lot 3-A . . .;
10. The said "Dokumento ng Bilihan:" is written in Tagalog, signed by plaintiff Trinidad Manuel
Mendoza, as vendor, witnessed by plaintiffs Juliana Mendoza and Pacita Mendoza Samonte, and
notarized by Atty. Pedro Magsalin;

11. In said "Dokumento ng Bilihan," plaintiff Trinidad Manuel Mendoza declared the following:

Na sa aming kasunduan ng aking mga anak at ako, ang nasabing Lot 3-A ay siyang aking
kalahati sa nasabing Lot 3, na may kaunting lamang, at ang Lot 3-B ay siyang nauukol sa
aking mga anak na tunay nilang pag-aari. (See first paragraph, page 3, Dokumento ng
Bilihan, (Annex "C");

Na sa aking pakikpagkasundo (sic) sa aking mga anak at sa kanilang kapasiyahan at


kapahintulutan ang nasabing Lot 3-A ay siyang aking ipinagbili sa magasawang (sic) Renato
Samonte at Lucia de la Cruz, alang-alang sa aming pangako na ipagbili sa nasabing
magasawa ang kalahati ng naturang Lot 3, na ang halaga ay matagal ng tinanggap namin sa
mga nakabiling magasawa. (see second paragraph, page 3, Dokumento ng Bilihan, supra);

Na alang-alang (sic) sa halagang TATLONG LIBO AT LIMANG DAANG PISO (P3,500.00),


Salaping Pilipino (sic), na aking ng (sic) tinanggap na may mga dalawang taon na sa
magasawang (sic) RENATO SAMONTE at LUCIA DE LA CRUZ, mga Pilipino (sic), may sapat
na gulang at naninirahan sa Taliptip, Bulacan, Bulacan, ay aking ipinagbibili, isinasalin at
inililipat sa nasabing magasawang Renato Samonte at Lucia de la Cruz, sa kanilang mga
anak at tagapagmana ang Lot 3-A ng Lote 3, na binabanggit sa itaas nito, pati ng
pagkamayari at possesion (sic) ng nasabing Lote 3-A, na walang pinanagutan (sic) kahit ano
hanggang sa petsang ito, at aking ipagtatangol sa ano mang habol sa Lote 3-A ang mga
bumiling magasawang (sic) Renato Samonte at Lucia de la Cruz sa sarili kong pananagot.
(See last paragraph, page 2, Dokumento ng Bilihan, supra).

12. All the improvements in said Lot 3-A were placed therein by defendant spouses Renato Samonte
and Lucia de la Cruz Samonte.

WHEREFORE, parties herein respectfully pray that the foregoing partial stipulation of facts be
admitted, and that the above-entitled case be set for hearing for purposes of receiving evidence insofar
as the contorverted (sic) facts are concerned.

Malolos, Bulacan, June 18, 1971.

(SGD.) ERNESTO M. TOMANENG

Counsel for the plaintiffs

Suite 507 Marvel Bldg. I

258 Juan Luna, Manila

(SGD.) FRANCISCO E. RODRIGO, JR.

Counsel for the defendants

54 Dona (sic) Juana Rodriguez, St.

Quezon City
On October 15, 1973, the trial court dismissed the complaint, with costs against petitioners, based on
the following grounds (pp. 51-53, Record on Appeal):

There are several issues raised by the plaintiffs in their pre-trial brief as well as memorandum
and foremost among them is the question regarding the validity of the sale. According to the
plaintiffs, the sale of the disputed property in favor of the defendants was null and void
because as a mere co-owner of an undivided estate, Trinidad Mendoza had no right to divided
(sic) the estate into parts and then convey a part thereof by metes and bounds to a third
person. Such was the case, according to the plaintiffs, since there had never been any
partition, judicial or extrajudicial, of the estate among the heirs of the late Arcadio Mendoza.

It is apparent that the resolution of this issue will depend on whether or not the heirs of
Arcadio Mendoza had already partitioned his estate and in pursuance thereto, adjudicated the
lot in question to the plaintiff Trinidad Mendoza.

After examining the "Dokumento ng Bilihan," evidencing the sale of the lot in question to the
defendants, the Court is convinced that there was such an agreement to partition the
properties, including the one involved in this case, left by the deceased Arcadio Mendoza.
From paragraphs 4 and 5 of said document, . . . it can readily be seen that the partition had
been accomplished by the heirs of Arcadio Mendoza. . . . Said paragraphs, which read as
follows, clearly stated that it was the agreement among the surviving children and wife of
Arcadio Mendoza that Lot 3-A, which was the other half of Lot 3, was to be the share of
plaintiff Trinidad Mendoza while Lot 3-B would belong to the children:

Na sa aming kasunduan ng aking mga anak at ako, ang nasabing Lot 3-A ay siyang
aking kalahati sa nasabing Lot 3, na may kaunting lamang, at ang Lot 3-B ay siyang
nauukol sa aking mga anak na tunay nilang pagaari (sic).

Na sa aking pakikipagkasundo sa aking mga anak at sa kanilang kapasiyahan at


kapahintulutan ang nasabing Lot 3-A ay siyang aking ipinagbili sa magasawang (sic)
Renato Samonte at Lucia dela Cruz, alang-alang sa aming pangako na ipagbili sa
nasabing magasawa (sic) ang kalahati ng naturang Lot 3, na ang halaga ay matagal
ng (sic) tinanggap (sic) namin sa mga nakabiling magasawa (sic).

Indeed, it must habe (sic) been because of this agreement to partition the estate, that Lot 3,
from which the land in question came, was subdivided on September 7, 1961 by a surveyor
as stated in the second paragraph of said deed of sale.

Na upang mahati humigit kumulang sa dalawang bahagi ang nasabing Lote No. 3,
ang isa ay para sa mga anak ng namatay na aking asawang Arcadio Mendoza, at
ang pangalawa ay para sa akin na tunay kong pagaari (sic), ay ipinagawa namin ang
ang (sic) plano de subdivision (LRC) PSD-17370 petsa Sept. 7, 1961, aprobado ni G.
Antonio H. Noblejas, Comisionado ng Land Registration, at ang kinalabasan ay ang
mga sumusunod:

Lote 3-AArea 2238 sq. m.:

xxx xxx xxx

It bears emphasis that according to the fourth paragraph of the "Dokumento ng Bilihan"
quoted above, the sale made by plaintiff Trinidad Mendoza of Lot 3-A to the defendants had
the prior consent and approval of her children, the other plaintiffs herein.

In the opinion of the Court, the paragraphs cited above constitute clear admissions on the part
of plaintiff Trinidad Mendoza, who executed said deed of sale, and on the part of plaintiffs
Pacita Samonte and Juliana Samonte, who signed the same as witnesses, regarding the
existence of the partition agreement adjudicating to plaintiff Trinidad Mendoza the land in
question before it was sold to the defendants.

Of course, plaintiffs Trinidad Manuel, Pacita Samonte and Juliana Samonte, who all took the
stand, vehemently denied having read and understood the contents of the "Dokumento ng
Bilihan" which they admittedly signed. According to plaintiff Trinidad Manuel, she affixed her
thumbmark on the document when her sister Lourdes Manuel, the mother of defendant
Renato Samonte, asked her to do so and promised to take care of the "interests" of her
children. On her part, Pacita Samonte claimed that although she was able to read the title of
the document, she did not read the contents thereof, however, since she signed the same
only upon the assurance of her aunt that her mother Trinidad Mendoza, had already given her
conformity. Juliana Samonte also denied having read the document but alleged that her
failure to do so was due to her illness then.

But in the opinion of the Court, all these deals cannot prevail over the presumption that the
said plaintiffs understood the contents of the deed of sale whtn (sic) they signed the same.
For following the ordinary course of human nature, one does not affix his signature on a legal
document if he does not understand the same. Besides, it appears that the "document (sic) ng
Bilihan" was written in a dialect spoken by and known to the said plaintiffs who while on the
stand all testified in the Tagalog dialect.

Moreover, according to plaintiff Romeo Mendoza, the son of plaintiff Trinidad Mendoza, the
"Dokumento ng Bilihan" was prepared by their lawyer, Atty. Pedro Magsalin who according to
the defendant Renato Samonte read the same to the plaintiffs Trinidad Mendoza, Juliana and
Pacita Samonte before the latter affixed their respective signatures, a fact which is not
improbable.

Indeed, there is another circumstance showing why the denials of plaintiffs Trinidad Mendoza,
Juliana and Pacita Samonte cannot be given much credit. These three plaintiffs testified that
they did not know the contents of the deed of sale not only at the time they signed it but also
after they had executed the same. Yet, the undeniable fact remains that after the execution of
said deed of sale in 1962, the defendants started building their house on the lot in question in
barrio Taliptip, Bulacan, Bulacan. The failure of said plaintiffs and of the other plaintiffs to stop
or even question the defendants regarding the construction of their house on the lot in
question, which was being built openly in the vicinity where they all resided, can only mean
that the plaintiffs knew that the defendants had a right to build on the disputed property.

Considering the finding of the Court that Lot 3-A, the property in question, was the subject of a
partition agreement and was adjudicated to plaintiff Trinidad Mendoza, it follows that said
property was no longer held in co-ownership by the plaintiffs at the time that it was sold to the
defendants. Such being the case, the provisions of Article 1620 of the Civil Code, allowing a
co-owner to exercise the right of redemption, cannot be applied.

To summarize, the trial court took into account the following in dismissing petitioners' complaint: (1) the
pertinent provisions of the "Dokumento ng Bilihan" to prove that Lot 3 has been subdivided and that
Lot 3-A has been adjudicated to petitioner Trinidad Manuel Mendoza; (2) the presumption that
petitioners Trinidad Manuel Mendoza, Pacita Samonte and Juliana Mendoza understood the contents
of the document when they signed it; (3) estoppel on the part of petitioners; and (4) non-applicability of
Article 1620 of the Civil Code.

On appeal, the respondent Court of Appeals affirmed the decision of the trial court (p. 40, Rollo). The motion
1âw phi 1

for reconsideration was denied (p. 70, Rollo) Hence, the present petition.

The issues are whether or not: (1) the "Dokumento ng Bilihan" is valid; and (2) petitioners can still exercise the
right of legal redemption.
According to petitioners, on June 26, 1962, when the alleged "Dokumento ng Bilihan" was executed by Trinidad
Manuel Mendoza, Lot 3-A was still under litigation for it was only on September 23, 1964, that C.A.-G.R. No.
22891-R was decided by the respondent court. This being the case, petitioners have not executed any
agreement of partition, judicial or extrajudicial. As held by the respondent court in C.A.-G.R. No. 22891-R, Lot
3-A (and other lots) was donated by Jose Samonte to Arcadio Mendoza for which reason, petitioner Trinidad
Manuel Mendoza is not entitled to one-half (1/2) of Lot 3 but only to the share of one (1) legitimate child or 1/13
rights and interests, citingArticle 996 of the Civil Code.1 The "Dokumento ng Bilihan" is null and void insofar as it
affects the rights and interests of the other petitioners because petitioner Trinidad Manuel Mendoza can only
sell her 1/13 rights and interests over Lot 3-A and not more than that. Corollarily, the remaining petitioners can
still exercise the right of legal redemption, conformably with Article 1620 of the Civil Code.2

Disputing these allegations of petitioners, private respondents contend that petitioner Trinidad Manuel
Mendoza declared under oath in the "Dokumento ng Bilihan" that Lot 3-A was given to her by virtue of an
agreement of partition between her and her children. She declared further that the land in question was sold by
her to private respondents with the knowledge and consent of her children. The amount paid therefor was
known to her and her children. The document was written in Tagalog, the dialect in Bulacan. It was signed by
petitioner Trinidad Manuel Mendoza, as vendor, witnessed by petitioners Pacita Samonte and Juliana Mendoza
and prepared and notarized by Atty. Pedro Magsalin, the family lawyer of petitioners. Having participated in,
consented to and/or benefited from the sale, petitioners are estopped from impugning the validity and
enforcesbility thereof.

Likewise, We affirm.

In resolving the first issue, We have to settle two (2) sub-issues: (1) has Lot 3 been partitioned; and (2) if so,
has the subject lot been adjudicated to petitioner Trinidad Manuel Mendoza? In this case, the source of co-
ownership among the heirs was intestate succession. Where there are two or more heirs, the whole estate of
the decedent is, before its partition, owned in common by such heirs (Article 1078 of the Civil Code).
Petitioners' co-ownership over Lot 3 was extinguished when it was subdivided into Lot 3-A and Lot 3-B, which
portions were concretely determined and technically described (see de la Cruz v. Cruz, G.R. No. L-27759, April
17, 1970, 32 SCRA 307). Against the impetuous denial of petitioners that Lot 3 has been partitioned (pp. 19,
96, 121, Rollo) is Exhibit A which is the Subdivision Plan of Lot 3, (LRC) PSD-17370, dated September 7,
1961, duly approved by the Commissioner of Land Registration. It is also Our finding that Lot 3-A has been
adjudicated to petitioner Trinidad Manuel Mendoza. We take into account the pertinent provisions of the
"Dokumento ng Bilihan" and estoppel on the part of petitioners (pp. 6-8, supra). Therefore, the "Dokumento ng
Bilihan" is a valid document.

We resolve the second issue based on the previous discussion that the co-ownership has been extinguished.
Article 1620 of the Civil Code applies only if the co-ownership still exists. If the property has been partitioned or
an identified share has been sold, there is no longer any right of legal redemption (see Umengan v. Butucan, et
al., 117 Phil. 325; Caro v. Court of Appeals, et al., G.R. No. L-46001, March 25, 1982, 113 SCRA 10).

ACCORDINGLY, the petition is hereby DENIED. The decision dated June 23, 1976 and the resolution dated
September 15, 1976 of the Court of Appeals are AFFIRMED.
G.R. No. L-18009 January 10, 1923

EMILIO PUNSALAN, ET AL., plaintiffs-appellants,


vs.
C. BOOT LIAT, ET AL., defendants-appellants.

Yeager and Armstrong, C. A. Sobral and Lorenzo and Mañalac for plaintiffs-appellants.
Kincaid, Perkins and Kincaid and P. J. Moore for defendants-appellants.

AVANCEÑA, J.:

On or about the 13th of July, 1920, a Moro by the name of Tamsi saw from the Cawit-Cawit shores in the
Province of Zamboanga, a big bulky object in the distance which attracted his attention. Thereupon, together
with another Moro named Bayrula, he went in a small boat to investigation and found it to be a large fish. They
then returned to shore, where they met other Moros and requested their help to catch the fish. They went in
three small boats, there being then in one, seven in the other, and five in the third, twenty-two men, in all,
twenty-one of whom are plaintiffs herein, and the remaining one named Ahamad is defendant. After having
arrived at the place where the fish was, which was found to be a whale, they proceeded to pull it toward the
shore up to the mouth of the river, where they quartered it, having found in its abdomen a great quantity of
ambergris, which was placed in three sacks, two of which were full and the other half full, and taken to the
house of Maharaja Butu, where they left it to the care of Ahamad. Then the contents of the two full sacks were
placed in three trunks. All of these twenty-two persons made an agreement that they were to be the sole
owners of this ambergris and that none of them could sell it without the consent of the rest. As to the half sack
of amber they agreed that some of them should take it to Zamboanga to sell for the purpose of ascertaining the
market price of the ambergris, in order that they might dispose of the rest accordingly. Some of them, with
Tamsi in charge, went to Zamboanga to sell the half sack of amber where they did dispose of it to a Chinaman,
Cheong Tong, for the sum of P2,700, which amount was distributed among all the parties in interest. Then they
offered to sell for the sum of P12,000 to the Chinamen, Cheong Tong and Lim Chiat, the rest of the amber
contained in the two sacks which had been left in the house of Maharaja Butu, for safekeeping, and a
document (Exhibit A) to this effect was executed by Lim Chiat and Cheong Tong, on the one hand, and Tamsi,
Imam Lumuyod, and Imam Asakil, on the other. Thereupon they went to Cawit-Cawit on board the
launch Ching-kang to get the amber so sold.

It appears that there were other people in Zamboanga who knew of the existence of this ambergris in the
house of Maharaja Butu. While the above related events were taking place, Mr. Henry E. Teck, who was one of
those having knowledge of the existence of this amber in Cawit-Cawit and of the fact that the launch Ching-
kang had left for Cawit-Cawit, proposed to the master of the revenue cutter Mindoro to go to Cawit-Cawit to
seize some supposedly contraband opium. After transmitting this information to the Collector of Customs, he,
the master of the Mindoro, immediately proceeded to Cawit-Cawit. There were on board the vessel Mr. Teck,
some Chinamen, among whom were C. Boon Liat, Ong Chua, and Go Tong, and some Moros who, according
to Mr. Teck, were to assist in the arrest of the smugglers. Upon the arrival of the Mindoro at Cawit-Cawit, the
master, accompanied by Mr. Teck and some Moros, went to the house of Maharaja Butu. As is to be
presumed, this information about the supposed contraband opium was but a trick to have the Mindoro at their
disposal. The master proceeded to search the house, stating that he had information to the effect that there
was contraband opium and as a result of the search, he found three large trunks containing a black substance
which had a bad odor. He then asked the owner of the house to whom those three trunks belonged, and the
latter pointed to Ahamad who was present and who stated that the contents came from the abdomen of a large
fish. The master, however, said that it was opium and told Ahamad that he would take the three trunks on
board the ship. Then Ahamad and other Moros asked permission of the master to accompany him on the
voyage to Zamboanga, to which the master consented. When already on board and during the voyage the
master became convinced that the contents of the three trunks were not opium.

During the voyage, Mr. Teck offered to purchase the amber contained in the three trunks, but Ahamad refused
to sell it for the reason that he was not the sole owner thereof, but owned it in common with other persons who
were in Zamboanga. However Mr. Teck, aided by his companions who wielded some influence in Zamboanga,
insisted that Ahamad should sell them the amber, telling him not to be afraid of his companions, as he would
answer for whatever might happen. With this promise of protection, Ahamad decided to sell the amber for
P7,500 and received P2,500 as part payment on account of this price, a bill of sale having been signed by
Ahamad, Maharaja Butu and three Moros more. The balance of this price was paid later.

When Cheong Tong, Lim Chiat, and the Moros who had gone to Cawit-Cawit on board the launch Ching-
kangarrived at the house of Maharaja Butu, they found that the amber they had purchased from Tamsi and his
companions was no longer there.

The plaintiffs are twenty-one of the twenty-two Moros who had caught the whale, and Lim Chiat and Cheong
Tong, who had purchased from Tamsi and his companions the amber contained in the three trunks deposited
in the house of Maharaja Butu for safekeeping. They claim the 80-½ kilos of ambergris contained in three
trunks, or its value in the amount o P60,000, and damages in the sum of P20,000. This action is brought
against C. Boon Liat, Ong Chua, Go Tong, Henry E. Teck, and the Moro, Ahamad, the first four being the
persons who purchased this same amber from the one last named while on board the revenue cutter Mindoro.

It appears from the foregoing that the amber in question was the undivided common property of the plaintiffs
(with the exception of Lim Chiat and Cheong Tong) and the defendant Ahamad. This common ownership was
acquired by occupancy (arts. 609 and 610 of the Civil Code), so that neither Tamsi, Imam Lumuyod, or Imam
Asakil had any right to sell it, as they did, to Lim Chiat and Cheong Tong, nor had the Moro Ahamad any right
to sell this same amber, as he did, to C. Boon Liat, Ong Chua, Go Tong, and Henry E. Teck. There was an
agreement between the coowners not to sell this amber without the consent of all. Both sales having been
made without the consent of all the owners, the same have no effect, except as to the portion pertaining to
those who made them (art. 399, Civil Code).

Although the original complaint filed in this case was entitled as one for replevin, in reality, from its allegations,
the action herein brought is the ordinary one for the recovery of the title to, and possession of, this amber. It is
no bar to the bringing of this action that the defendant Ahamad is one of the coowners. The action for recovery
which each coowner has, derived from the right of ownership inherent in the coownership, may be exercised
not only against strangers but against the coowners themselves, when the latter perform, with respect to the
thing held in common, acts for their exclusive benefit, or of exclusive ownership, or which are prejudicial to, and
in violation of, the right of the community. (Decision of the supreme court of Spain of June 22, 1892.) In this
case the selling of the amber by the defendant Ahamad as his exclusive property and his attitude in
representing himself to be the sole owner thereof place him in the same position as the stranger who violates
any right of the community. He is not sued in this case as a coowner, for the cause of action is predicated upon
the fact that he has acted not as a coowner, but as an exclusive owner of the amber sold by him.

As to the sale made by Ahamad, it is urged that the purchaser acted in good faith. It is contended that the latter
did not know that the amber belonged to some others besides Ahamad. But the evidence shows otherwise.
Henry E. Teck himself admitted that on the occasion of the sale of the amber he really had promised Ahamad
to protect him, and although he said that the promise made by him had reference to the contingency of the
amber proving to be opium, as the master of the revenue cutter Mindoro believed, this is incredible, because he
could not make Ahamad such a promise, nor could such a promise, if made, have any influence on the mind of
Ahamad, inasmuch as the latter knew that the amber was not opium. If, as Henry E. Teck admits, he made
Ahamad this promise of protection, it should have been only on account of Ahamad's refusal to sell the amber
due to the fact that he was not the sole owner thereof.

With regard to the action of the trial court in not admitting Exhibits 1 and 2 offered by the defendants, we
believed that it was no error. These documents are affidavits signed by Paslangan, and the best evidence of
their contents was the testimony of Paslangan himself whom the plaintiffs had the right to cross-examine.
Moreover, they are substantially the same as the statements made by Paslangan at the trial when testifying as
witness for the defendants, and for this reason the ruling of the trial court excluding these documents would
not, at all events, affect the merits of the case.

In the complaint it is alleged that the value of the amber is P60,000. Upon the evidence adduced on this point,
and taking into account that the defendant, Henry E. Teck, himself, testifying as witness, has stated that this
amber was worth P1,200 per kilo, we accept this estimated value set forth in the complaint.

The decision of the court below contains the following order for judgment:
Wherefore, it is the judgment and order of the court that the defendants C. Boon Liat, Henry E. Teck,
Ahamad Ong Chua, and Go Tong deliver to the plaintiffs, Emilio Punsalan, Bayrula, Daring Gumuntol,
Mohamad, Insael, Dunkaland, Tahil, Dambul, Dagan, Sabay, Sahibul, Pingay, Mujahad, Amilol,
Baraula, Saraban, Lim Chiat, and Cheong Tong twenty-twenty-first (20/21) of the amber in question,
or, in default thereof, to pay them its value of twelve thousand pesos (P12,000), less one-twenty-first of
said amount.

Therefore, the judgment appealed from is affirmed, with the only modification that the value of the amber which
is the subject-matter of this action shall be P60,000, without special finding as to the costs of this instance. So
ordered.
G.R. No. 176405 August 20, 2008

LEO WEE, petitioner,


vs.
GEORGE DE CASTRO (on his behalf and as attorney-in-fact of ANNIE DE
CASTRO and FELOMINA UBAN) and MARTINIANA DE
CASTRO, respondents.

DECISION

CHICO-NAZARIO, J.:

Before this Court is a Petition for Review on Certiorari1 under Rule 45 of the
Revised Rules of Court filed by petitioner Leo Wee, seeking the reversal and
setting aside of the Decision2 dated 19 September 2006 and the
Resolution3 dated 25 January 2007 of the Court of Appeals in CA-G.R. SP
No. 90906. The appellate court, in its assailed Decision, reversed the
dismissal of Civil Case. No. 1990, an action for ejectment instituted by
respondent George de Castro, on his own behalf and on behalf of Annie de
Castro, Felomina de Castro Uban and Jesus de Castro4 against petitioner, by
the Municipal Trial Court (MTC) of Alaminos City, which was affirmed by the
Regional Trial Court (RTC), Branch 54, Alaminos City, Pangasinan; and,
ruling in favor of the respondents, ordered the petitioner to vacate the subject
property. In its assailed Resolution dated 25 January 2007, the Court of
Appeals refused to reconsider its earlier Decision of 19 September 2006.

In their Complaint5 filed on 1 July 2002 with the MTC of Alaminos City,
docketed as Civil Case No. 1990, respondents alleged that they are the
registered owners of the subject property, a two-storey building erected on a
parcel of land registered under Transfer Certificate of Title (TCT) No. 16193 in
the Registry of Deeds of Pangasinan, described and bounded as follows:

A parcel of land (Lot 13033-D-2, Psd-01550-022319, being a portion of


Lot 13033-D, Psd-018529, LRC Rec. No. ____) situated in Pob.,
Alaminos City; bounded on the NW. along line 1-2 by Lot 13035-D-1 of
the subdivision plan; on the NE. along line 2-3 by Vericiano St.; on the
SE. along line 3-4 by Lot 13033-D-2 of the subdivision plan; on the SW.
along line 4-1 by Lot 575, Numeriano Rabago. It is coverd by TCT No.
16193 of the Register of Deeds of Pangasinan (Alaminos City) and
declared for taxation purposes per T.D. No. 2075, and assessed in the
sum of P93,400.00.6
Respondents rented out the subject property to petitioner on a month to
month basis for P9,000.00 per month.7 Both parties agreed that effective 1
October 2001, the rental payment shall be increased from P9,000.00
to P15,000.00. Petitioner, however, failed or refused to pay the corresponding
increase on rent when his rental obligation for the month of 1 October 2001
became due. The rental dispute was brought to the Lupon
Tagapagpamayapa of Poblacion, Alaminos, Pangasinan, in an attempt to
amicably settle the matter but the parties failed to reach an agreement,
resulting in the issuance by the Barangay Lupon of a Certification to file action
in court on 18 January 2002. On 10 June 2002, respondent George de Castro
sent a letter to petitioner terminating their lease agreement and demanding
that the latter vacate and turn over the subject property to respondents. Since
petitioner stubbornly refused to comply with said demand letter, respondent
George de Castro, together with his siblings and co-respondents, Annie de
Castro, Felomina de Castro Uban and Jesus de Castro, filed the Complaint for
ejectment before the MTC.

It must be noted, at this point, that although the Complaint stated that it was
being filed by all of the respondents, the Verification and the Certificate of
Non-Forum Shopping were signed by respondent George de Castro alone. He
would subsequently attach to his position paper filed before the MTC on 28
October 2002 the Special Powers of Attorney (SPAs) executed by his sisters
Annie de Castro and Felomina de Castro Uban dated 7 February 2002 and 14
March 2002 respectively, authorizing him to institute the ejectment case
against petitioner.

Petitioner, on the other hand, countered that there was no agreement


between the parties to increase the monthly rentals and respondents' demand
for an increase was exorbitant. The agreed monthly rental was only for the
amount of P9,000.00 and he was religiously paying the same every month.
Petitioner then argued that respondents failed to comply with the jurisdictional
requirement of conciliation before the Barangay Lupon prior to the filing of
Civil Case. No. 1990, meriting the dismissal of their Complaint therein. The
Certification to file action issued by the Barangay Lupon appended to the
respondents' Complaint merely referred to the issue of rental increase and not
the matter of ejectment. Petitioner asserted further that the MTC lacked
jurisdiction over the ejectment suit, since respondents' Complaint was devoid
of any allegation that there was an "unlawful withholding" of the subject
property by the petitioner.8

During the Pre-Trial Conference9 held before the MTC, the parties stipulated
that in May 2002, petitioner tendered to respondents the sum of P9,000.00 as
rental payment for the month of January 2002; petitioner paid rentals for the
months of October 2001 to January 2002 but only in the amount of P9,000.00
per month; respondents, thru counsel, sent a letter to petitioner on 10 June
2002 terminating their lease agreement which petitioner ignored; and
the Barangay Lupon did issue a Certification to file action after the parties
failed to reach an agreement before it.

After the submission of the parties of their respective Position Papers, the
MTC, on 21 November 2002, rendered a Decision10 dismissing respondents'
Complaint in Civil Case No. 1990 for failure to comply with the prior
conciliation requirement before the Barangay Lupon. The decretal portion of
the MTC Decision reads:

WHEREFORE, premised considered, judgment is hereby rendered


ordering the dismissal of this case. Costs against the [herein
respondents].

On appeal, docketed as Civil Case No. A-2835, the RTC of Alaminos,


Pangasinan, Branch 54, promulgated its Decision11 dated 27 June 2005
affirming the dismissal of respondents' Complaint for ejectment after finding
that the appealed MTC Decision was based on facts and law on the matter.
The RTC declared that since the original agreement entered into by the
parties was for petitioner to pay only the sum of P9.000.00 per month for the
rent of the subject property, and no concession was reached by the parties to
increase such amount to P15.000.00, petitioner cannot be faulted for paying
only the originally agreed upon monthly rentals. Adopting petitioner's position,
the RTC declared that respondents' failure to refer the matter to
the Barangay court for conciliation process barred the ejectment case,
conciliation before the Lupon being a condition sine qua non in the filing of
ejectment suits. The RTC likewise agreed with petitioner in ruling that the
allegation in the Complaint was flawed, since respondents failed to allege that
there was an "unlawful withholding" of possession of the subject property,
taking out Civil Case No. 1990 from the purview of an action for unlawful
detainer. Finally, the RTC decreed that respondents' Complaint failed to
comply with the rule that a co-owner could not maintain an action without
joining all the other co-owners. Thus, according to the dispositive portion of
the RTC Decision:

WHEREFORE the appellate Court finds no cogent reason to disturb the


findings of the court a quo. The Decision dated November 21, 2002
appealed from is hereby AFFIRMED IN TOTO.12
Undaunted, respondents filed a Petition for Review on Certiorari13 with the
Court of Appeals where it was docketed as CA-G.R. SP No. 90906.
Respondents argued in their Petition that the RTC gravely erred in ruling that
their failure to comply with the conciliation process was fatal to their
Complaint, since it is only respondent George de Castro who resides in
Alaminos City, Pangasinan, while respondent Annie de Castro resides in
Pennsylvania, United States of America (USA); respondent Felomina de
Castro Uban, in California, USA; and respondent Jesus de Castro, now
substituted by his wife, Martiniana, resides in Manila. Respondents further
claimed that the MTC was not divested of jurisdiction over their Complaint for
ejectment because of the mere absence therein of the term "unlawful
withholding" of their subject property, considering that they had sufficiently
alleged the same in their Complaint, albeit worded differently. Finally,
respondents posited that the fact that only respondent George de Castro
signed the Verification and the Certificate of Non-Forum Shopping attached to
the Complaint was irrelevant since the other respondents already executed
Special Powers of Attorney (SPAs) authorizing him to act as their attorney-in-
fact in the institution of the ejectment suit against the petitioner.

On 19 September 2006, the Court of Appeals rendered a Decision granting


the respondents' Petition and ordering petitioner to vacate the subject property
and turn over the same to respondents. The Court of Appeals decreed:

WHEREFORE, premises considered, the instant petition is GRANTED.


The assailed Decision dated June 27, 2005 issued by the RTC of
Alaminos City, Pangasinan, Branch 54, is REVERSED and SET ASIDE.
A new one is hereby rendered ordering [herein petitioner] Leo Wee to
SURRENDER and VACATE the leased premises in question as well as
to pay the sum of P15,000.00 per month reckoned from March, 2002
until he shall have actually turned over the possession thereof to
petitioners plus the rental arrearages of P30,000.00 representing unpaid
increase in rent for the period from October, 2001 to February, 2002,
with legal interest at 6% per annum to be computed from June 7, 2002
until finality of this decision and 12% thereafter until full payment
thereof. Respondent is likewise hereby ordered to pay petitioners the
amount of P20,000.00 as and for attorney's fees and the costs of suit.14

In a Resolution dated 25 January 2007, the appellate court denied the Motion
for Reconsideration interposed by petitioner for lack of merit.

Petitioner is now before this Court via the Petition at bar, making the following
assignment of errors:
I.

THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN


DECLARING THAT CONCILIATION PROCESS IS NOT A
JURISDICTIONAL REQUIREMENT THAT NON-COMPLIANCE
THEREWITH DOES NOT AFFECT THE JURISDICTION IN
EJECTMENT CASE;

II.

THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN


UPHOLDING THE SUFFICIENCY OF THE ALLEGATIONS IN THE
COMPLAINT FOR EJECTMENT DESPITE THE WANT OF
ALLEGATION OF "UNLAWFUL WITHOLDING PREMISES" (sic)
QUESTIONED BY PETITIONER;

III.

THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN


RULING THAT THE FILING OF THE COMPLAINT OF RESPONDENT
GEORGE DE CASTRO WITHOUT JOINING ALL HIS OTHER CO-
OWNERS OVER THE SUBJECT PROPERTY IS PROPER;

IV.

THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN NOT


APPLYING SUPREME COURT CIRCULAR NO. 10 WHICH DIRECTS
A PLEADER TO INDICATE IN HIS PLEADINGS HIS OFFICIAL
RECEIPT OF HIS PAYMENT OF HIS IBP DUES.15

Petitioner avers that respondents failed to go through the conciliation process


before the Barangay Lupon, a jurisdictional defect that bars the legal action for
ejectment. The Certification to file action dated 18 January 2002 issued by
the Barangay Lupon, appended by the respondents to their Complaint in Civil
Case No. 1990, is of no moment, for it attested only that there was
confrontation between the parties on the matter of rental increase but not on
unlawful detainer of the subject property by the petitioner. If it was the
intention of the respondents from the very beginning to eject petitioner from
the subject property, they should have brought up the alleged unlawful stay of
the petitioner on the subject property for conciliation before the Barangay
Lupon.
The barangay justice system was established primarily as a means of easing
up the congestion of cases in the judicial courts. This could be accomplished
through a proceeding before the barangaycourts which, according to the one
who conceived of the system, the late Chief Justice Fred Ruiz Castro, is
essentially arbitration in character; and to make it truly effective, it should also
be compulsory. With this primary objective of the barangay justice system in
mind, it would be wholly in keeping with the underlying philosophy of
Presidential Decree No. 1508 (Katarungang Pambarangay Law), which would
be better served if an out-of-court settlement of the case is reached voluntarily
by the parties.16 To ensure this objective, Section 6 of Presidential Decree No.
1508 requires the parties to undergo a conciliation process before the Lupon
Chairman or the Pangkat ng Tagapagkasundo as a precondition to filing a
complaint in court subject to certain exceptions. The said section has been
declared compulsory in nature.17

Presidential Decree No. 1508 is now incorporated in Republic Act No. 7160
(The Local Government Code), which took effect on 1 January 1992.

The pertinent provisions of the Local Government Code making conciliation a


precondition to the filing of complaints in court are reproduced below:

SEC. 412. Conciliation.- (a) Pre-condition to filing of complaint in court. -


No complaint, petition, action, or proceeding involving any matter within
the authority of the lupon shall be filed or instituted directly in court or
any other government office for adjudication, unless there has been a
confrontation between the parties before the lupon chairman or the
pangkat, and that no conciliation or settlement has been reached as
certified by the lupon secretary or pangkat secretary as attested to by
the lupon or pangkat chairman or unless the settlement has been
repudiated by the parties thereto.

(b) Where parties may go directly to court. - The parties may go directly
to court in the following instances:

(1) Where the accused is under detention;

(2) Where a person has otherwise been deprived of personal


liberty calling for habeas corpus proceedings;

(3) Where actions are coupled with provisional remedies such as


preliminary injunction, attachment, delivery of personal property,
and support pendente lite; and
(4) Where the action may otherwise be barred by the statute of
limitations.

(c) Conciliation among members of indigenous cultural communities. -


The customs and traditions of indigenous cultural communities shall be
applied in settling disputes between members of the cultural
communities.

SEC. 408. Subject Matter for Amicable Settlement; Exception Thereto. -


The lupon of each barangay shall have authority to bring together the
parties actually residing in the same city or municipality for amicable
settlement of all disputes except:

(a) Where one party is the government or any subdivision or


instrumentality thereof;

(b) Where one party is a public officer or employee, and the dispute
relates to the performance of his official functions;

(c) Offenses punishable by imprisonment exceeding one (1) year or a


fine exceeding Five thousand pesos (P5,000.00);

(d) Offenses where there is no private offended party;

(e) Where the dispute involves real properties located in different cities
or municipalities unless the parties thereto agree to submit their
differences to amicable settlement by an appropriate lupon;

(f) Disputes involving parties who actually reside in barangays of


different cities or municipalities, except where such barangay units
adjoin each other and the parties thereto agree to submit their
differences to amicable settlement by an appropriate lupon;

(g) Such other classes of disputes which the President may determine
in the interest of justice or upon the recommendation of the Secretary of
Justice.

There is no question that the parties to this case appeared before


the Barangay Lupon for conciliation proceedings. There is also no dispute that
the only matter referred to the Barangay Lupon for conciliation was the rental
increase, and not the ejectment of petitioner from the subject property. This is
apparent from a perusal of the Certification to file action in court issued by
the Barangay Lupon on 18 January 2002, to wit:

CERTIFICATION TO FILE COMPLAINTS

This is to certify that:

1. There was personal confrontation between parties before the


barangay Lupon regarding rental increase of a commercial building
but conciliation failed;

2. Therefore, the corresponding dispute of the above-entitled case may


now be filed in Court/Government Office.18 (Emphasis ours.)

The question now to be resolved by this Court is whether the Certification


dated 18 January 2002 issued by the Barangay Lupon stating that no
settlement was reached by the parties on the matter of rental increase
sufficient to comply with the prior conciliation requirement under
the Katarungang Pambarangay Law to authorize the respondents to institute
the ejectment suit against petitioner.

The Court rules affirmatively.

While it is true that the Certification to file action dated 18 January 2002 of
the Barangay Lupon refers only to rental increase and not to the ejectment of
petitioner from the subject property, the submission of the same for
conciliation before the Barangay Lupon constitutes sufficient compliance with
the provisions of the Katarungang Pambarangay Law. Given the particular
circumstances of the case at bar, the conciliation proceedings for the amount
of monthly rental should logically and reasonably include also the matter of
the possession of the property subject of the rental, the lease agreement, and
the violation of the terms thereof.

We now proceed to discuss the meat of the controversy.

The contract of lease between the parties did not stipulate a fixed period.
Hence, the parties agreed to the payment of rentals on a monthly basis. On
this score, Article 1687 of the Civil Code provides:

Art. 1687. If the period for the lease has not been fixed, it is
understood to be from year to year, if the rent agreed upon
is annual; from month to month, if it is monthly; from week to week,
if the rent is weekly; and from day to day, if the rent is to be paid daily.
However, even though a monthly rent is paid, and no period for the
lease has been set, the courts may fix a longer term for the lease after
the lessee has occupied the premises for over one year. If the rent is
weekly, the courts may likewise determine a longer period after the
lessee has been in possession for over six months. In case of daily rent,
the courts may also fix a longer period after the lessee has stayed in the
place for over one month. (Emphasis supplied.)

The rentals being paid monthly, the period of such lease is deemed
terminated at the end of each month. Thus, respondents have every right to
demand the ejectment of petitioners at the end of each month, the contract
having expired by operation of law. Without a lease contract, petitioner has no
right of possession to the subject property and must vacate the same.
Respondents, thus, should be allowed to resort to an action for ejectment
before the MTC to recover possession of the subject property from petitioner.

Corollarily, petitioner's ejectment, in this case, is only the reasonable


consequence of his unrelenting refusal to comply with the respondents'
demand for the payment of rental increase agreed upon by both parties.
Verily, the lessor's right to rescind the contract of lease for non-payment of the
demanded increased rental was recognized by this Court in Chua v. Victorio19:

The right of rescission is statutorily recognized in reciprocal obligations,


such as contracts of lease. In addition to the general remedy of
rescission granted under Article 1191 of the Civil Code, there is an
independent provision granting the remedy of rescission for breach of
any of the lessor or lessee's statutory obligations. Under Article 1659 of
the Civil Code, the aggrieved party may, at his option, ask for (1) the
rescission of the contract; (2) rescission and indemnification for
damages; or (3) only indemnification for damages, allowing the contract
to remain in force.

Payment of the rent is one of a lessee's statutory obligations, and,


upon non-payment by petitioners of the increased rental in
September 1994, the lessor acquired the right to avail of any of the
three remedies outlined above. (Emphasis supplied.)

Petitioner next argues that respondent George de Castro cannot maintain an


action for ejectment against petitioner, without joining all his co-owners.
Article 487 of the New Civil Code is explicit on this point:

ART. 487. Any one of the co-owners may bring an action in ejectment.

This article covers all kinds of action for the recovery of possession, i.e.,
forcible entry and unlawful detainer (accion interdictal), recovery of
possession (accion publiciana), and recovery of ownership (accion de
reivindicacion). As explained by the renowned civilist, Professor Arturo M.
Tolentino20:

A co-owner may bring such an action, without the necessity of


joining all the other co-owners as co-plaintiffs, because the suit is
deemed to be instituted for the benefit of all. If the action is for the
benefit of the plaintiff alone, such that he claims possession for himself
and not for the co-ownership, the action will not prosper. (Emphasis
added.)

In the more recent case of Carandang v. Heirs of De Guzman,21 this Court


declared that a co-owner is not even a necessary party to an action for
ejectment, for complete relief can be afforded even in his absence, thus:

In sum, in suits to recover properties, all co-owners are real parties in


interest. However, pursuant to Article 487 of the Civil Code and the
relevant jurisprudence, any one of them may bring an action, any kind of
action for the recovery of co-owned properties. Therefore, only one of
the co-owners, namely the co-owner who filed the suit for the recovery
of the co-owned property, is an indispensable party thereto. The other
co-owners are not indispensable parties. They are not even necessary
parties, for a complete relief can be afforded in the suit even without
their participation, since the suit is presumed to have been filed for the
benefit of all co-owners.

Moreover, respondents Annie de Castro and Felomina de Castro Uban each


executed a Special Power of Attorney, giving respondent George de Castro
the authority to initiate Civil Case No. 1990.
A power of attorney is an instrument in writing by which one person, as
principal, appoints another as his agent and confers upon him the authority to
perform certain specified acts or kinds of acts on behalf of the principal. The
written authorization itself is the power of attorney, and this is clearly indicated
by the fact that it has also been called a "letter of attorney."22

Even then, the Court views the SPAs as mere surplusage, such that the lack
thereof does not in any way affect the validity of the action for ejectment
instituted by respondent George de Castro. This also disposes of petitioner's
contention that respondent George de Castro lacked the authority to sign the
Verification and the Certificate of Non-Forum Shopping. As the Court ruled in
Mendoza v. Coronel23:

We likewise hold that the execution of the certification against


forum shopping by the attorney-in-fact in the case at bar is not a
violation of the requirement that the parties must personally sign
the same. The attorney-in-fact, who has authority to file, and who
actually filed the complaint as the representative of the plaintiff co-
owner, pursuant to a Special Power of Attorney, is a party to the
ejectment suit. In fact, Section 1, Rule 70 of the Rules of Court includes
the representative of the owner in an ejectment suit as one of the
parties authorized to institute the proceedings. (Emphasis supplied.)

Failure by respondent George de Castro to attach the said SPAs to the


Complaint is innocuous, since it is undisputed that he was granted by his
sisters the authority to file the action for ejectment against petitioner prior to
the institution of Civil Case No. 1990. The SPAs in his favor were respectively
executed by respondents Annie de Castro and Felomina de Castro Uban on 7
February 2002 and 14 March 2002; while Civil Case No. 1990 was filed by
respondent George de Castro on his own behalf and on behalf of his siblings
only on 1 July 2002, or way after he was given by his siblings the authority to
file said action. The Court quotes with approval the following disquisition of the
Court of Appeals:

Moreover, records show that [herein respondent] George de Castro was


indeed authorized by his sisters Annie de Castro and Felomina de
Castro Uban, to prosecute the case in their behalf as shown by the
Special Power of Attorney dated February 7, 2002 and March 14, 2002.
That these documents were appended only to [respondent George de
Castro's] position paper is of no moment considering that the authority
conferred therein was given prior to the institution of the complaint in
July, 2002. x x x.24
Respondent deceased Jesus de Castro's failure to sign the Verification and
Certificate of Non-Forum Shopping may be excused since he already
executed an Affidavit25 with respondent George de Castro that he had
personal knowledge of the filing of Civil Case No. 1990. In Torres v.
Specialized Packaging Development Corporation,26 the Court ruled that the
personal signing of the verification requirement was deemed substantially
complied with when, as in the instant case, two out of 25 real parties-in-
interest, who undoubtedly have sufficient knowledge and belief to swear to the
truth of the allegations in the petition, signed the verification attached to it.

In the same vein, this Court is not persuaded by petitioner's assertion that
respondents' failure to allege the jurisdictional fact that there was "unlawful
withholding" of the subject property was fatal to their cause of action.

It is apodictic that what determines the nature of an action as well as which


court has jurisdiction over it are the allegations in the complaint and the
character of the relief sought. In an unlawful detainer case, the defendant's
possession was originally lawful but ceased to be so upon the expiration of his
right to possess. Hence, the phrase "unlawful withholding" has been held to
imply possession on the part of defendant, which was legal in the beginning,
having no other source than a contract, express or implied, and which later
expired as a right and is being withheld by defendant.27

In Barba v. Court of Appeals,28 the Court held that although the phrase
"unlawfully withholding" was not actually used by therein petitioner in her
complaint, the Court held that her allegations, nonetheless, amounted to an
unlawful withholding of the subject property by therein private respondents,
because they continuously refused to vacate the premises even after notice
and demand.

In the Petition at bar, respondents alleged in their Complaint that they are the
registered owners of the subject property; the subject property was being
occupied by the petitioner pursuant to a monthly lease contract; petitioner
refused to accede to respondents' demand for rental increase; the
respondents sent petitioner a letter terminating the lease agreement and
demanding that petitioner vacate and turn over the possession of the subject
property to respondents; and despite such demand, petitioner failed to
surrender the subject property to respondents.29 The Complaint sufficiently
alleges the unlawful withholding of the subject property by petitioner,
constitutive of unlawful detainer, although the exact words "unlawful
withholding" were not used. In an action for unlawful detainer, an allegation
that the defendant is unlawfully withholding possession from the plaintiff is
deemed sufficient, without necessarily employing the terminology of the law.30

Petitioner's averment that the Court of Appeals should have dismissed


respondents' Petition in light of the failure of their counsel to attach the Official
Receipt of his updated payment of Integrated Bar of the Philippines (IBP)
dues is now moot and academic, since respondents' counsel has already duly
complied therewith. It must be stressed that judicial cases do not come and go
through the portals of a court of law by the mere mandate of
technicalities.31 Where a rigid application of the rules will result in a manifest
failure or miscarriage of justice, technicalities should be disregarded in order
to resolve the case. 32

Finally, we agree in the ruling of the Court of Appeals that petitioner is liable
for the payment of back rentals, attorney's fees and cost of the suit.
Respondents must be duly indemnified for the loss of income from the subject
property on account of petitioner's refusal to vacate the leased premises.

WHEREFORE, premises considered, the instant Petition is DENIED. The


Decision dated 19 September 2006 and Resolution dated 25 January 2007 of
the Court of Appeals in CA-G.R. SP No. 90906 are hereby AFFIRMED in toto.
Costs against petitioner.
G.R. No. 166519 March 31, 2009

NIEVES PLASABAS and MARCOS MALAZARTE, Petitioners,


vs.
COURT OF APPEALS (Special Former Ninth Division), DOMINADOR LUMEN, and AURORA
AUNZO,Respondents.

DECISION

NACHURA, J.:

Assailed in this petition for review on certiorari under Rule 45 of the Rules of Court are the May 12, 2004
Decision1of the Court of Appeals (CA) in CA-G.R. CV No. 43085 and the December 1, 2004
Resolution2 denying reconsideration of the challenged decision.

The pertinent facts and proceedings follow.

In 1974, petitioners3 filed a complaint for recovery of title to property with damages before the Court of First
Instance (now, Regional Trial Court [RTC]) of Maasin, Southern Leyte against respondents. The case was
docketed as Civil Case No. R-1949. The property subject of the case was a parcel of coconut land in
Canturing, Maasin, Southern Leyte, declared under Tax Declaration No. 3587 in the name of petitioner Nieves
with an area of 2.6360 hectares.4In their complaint, petitioners prayed that judgment be rendered confirming
their rights and legal title to the subject property and ordering the defendants to vacate the occupied portion
and to pay damages.5

Respondents, for their part, denied petitioners’ allegation of ownership and possession of the premises, and
interposed, as their main defense, that the subject land was inherited by all the parties from their common
ancestor, Francisco Plasabas.6

Revealed in the course of the trial was that petitioner Nieves, contrary to her allegations in the complaint, was
not the sole and absolute owner of the land. Based on the testimonies of petitioners’ witnesses, the property
passed on from Francisco to his son, Leoncio; then to Jovita Talam, petitioner Nieves’ grandmother; then to
Antonina Talam, her mother; and then to her and her siblings—Jose, Victor and Victoria.7

After resting their case, respondents raised in their memorandum the argument that the case should have been
terminated at inception for petitioners’ failure to implead indispensable parties, the other co-owners – Jose,
Victor and Victoria.

In its April 19, 1993 Order,8 the trial court, without ruling on the merits, dismissed the case without prejudice,
thus:

This Court, much as it wants to decide the instant case on the merits, being one of the old inherited cases left
behind, finds difficulty if not impossibility of doing so at this stage of the proceedings when both parties have
already rested their cases. Reluctantly, it agrees with the defendants in the observation that some important
indispensable consideration is conspicuously wanting or missing.

It is not the Court’s wish to turn its back on the crucial part of the case, which is the pronouncement of the
judgment to settle the issues raised in the pleadings of the parties once and for all, after all the time, effort and
expense spent in going through the trial process.

But, rules are rules. They have to be followed, to arrive at a fair and just verdict. Section 7, Rule 3 of the Rules
of Court provides:

"x x x Compulsory joinder of indispensable parties. – Parties in interest without whom no final determination
can be had of an action shall be joined either as plaintiffs or defendants."
What the Court wants to say here is that the instant case should have been dismissed without prejudice a long
time ago for lack of cause of action as the plaintiffs spouses Marcos Malazarte and Nieves Plasabas Malazarte
have no complete legal personality to sue by themselves alone without joining the brothers and sisters of
Nieves who are as INDISPENSABLE as the latter in the final determination of the case. Not impleading them,
any judgment would have no effectiveness.

They are that indispensable that a final decree would necessarily affect their rights, so that the Court cannot
proceed without their presence. There are abundant authorities in this regard. Thus –

"The general rule with reference to the making of parties in a civil action requires the joinder of all
indispensable parties under any and all conditions, their presence being a sine qua non of the exercise of
judicial power. (Borlasa v. Polistico, 47 Phil. 345, 348) For this reason, our Supreme Court has held that when it
appears of record that there are other persons interested in the subject matter of the litigation, who are not
made parties to the action, it is the duty of the court to suspend the trial until such parties are made either
plaintiffs or defendants. (Pobre, et al. v. Blanco, 17 Phil. 156). x x x Where the petition failed to join as party
defendant the person interested in sustaining the proceeding in the court, the same should be dismissed. x x x
When an indispensable party is not before the court, the action should be dismissed. (People, et al. v.
Rodriguez, et al., G.R. Nos. L-14059-62, September 30, 1959) (sic)

"Parties in interest without whom no final determination can be had of an action shall be joined either as
plaintiffs or defendants. (Sec. 7, Rule 3, Rules of Court). The burden of procuring the presence of all
indispensable parties is on the plaintiff. (39 Amjur [sic] 885). The evident purpose of the rule is to prevent the
multiplicity of suits by requiring the person arresting a right against the defendant to include with him, either as
co-plaintiffs or as co-defendants, all persons standing in the same position, so that the whole matter in dispute
may be determined once and for all in one litigation. (Palarca v. Baginsi, 38 Phil. 177, 178).

"An indispensable party is a party who has such an interest in the controversy or subject matter that a final
adjudication cannot be made, in his absence, without inquiring or affecting such interest; a party who has not
only an interest of such a nature that a final decree cannot be made without affecting his interest or leaving the
controversy in such a condition that its final determination may be wholly inconsistent with equity and good
conscience. (67 C.J.S. 892). Indispensable parties are those without whom no action can be finally
determined." (Sanidad v. Cabataje, 5 Phil. 204)

WHEREFORE, IN VIEW OF ALL THE FOREGOING CONSIDERATIONS, both the complaint and the
counterclaim in the instant case are ordered DISMISSED without prejudice. No pronouncement as to costs.

SO ORDERED.9

Aggrieved, petitioners elevated the case to the CA. In the challenged May 12, 2004 Decision, 10 the appellate
court affirmed the ruling of the trial court. The CA, further, declared that the non-joinder of the indispensable
parties would violate the principle of due process, and that Article 487 of the Civil Code could not be applied
considering that the complaint was not for ejectment, but for recovery of title or a reivindicatory action.11

With their motion for reconsideration denied in the further assailed December 1, 2004 Resolution, 12 petitioners
filed the instant petition.

The Court grants the petition and remands the case to the trial court for disposition on the merits.

Article 487 of the Civil Code provides that any one of the co-owners may bring an action for ejectment. The1avv phi1.zw+

article covers all kinds of actions for the recovery of possession, including an accion publiciana and a
reivindicatory action. A co-owner may file suit without necessarily joining all the other co-owners as co-plaintiffs
because the suit is deemed to be instituted for the benefit of all. Any judgment of the court in favor of the
plaintiff will benefit the other co-owners, but if the judgment is adverse, the same cannot prejudice the rights of
the unimpleaded co-owners.13
With this disquisition, there is no need to determine whether petitioners’ complaint is one for ejectment or for
recovery of title. To repeat, Article 487 of the Civil Code applies to both actions.

Thus, petitioners, in their complaint, do not have to implead their co-owners as parties. The only exception to
this rule is when the action is for the benefit of the plaintiff alone who claims to be the sole owner and is, thus,
entitled to the possession thereof. In such a case, the action will not prosper unless the plaintiff impleads the
other co-owners who are indispensable parties.14

Here, the allegation of petitioners in their complaint that they are the sole owners of the property in litigation is
immaterial, considering that they acknowledged during the trial that the property is co-owned by Nieves and her
siblings, and that petitioners have been authorized by the co-owners to pursue the case on the latter’s
behalf.15Impleading the other co-owners is, therefore, not mandatory, because, as mentioned earlier, the suit is
deemed to be instituted for the benefit of all.

In any event, the trial and appellate courts committed reversible error when they summarily dismissed the case,
after both parties had rested their cases following a protracted trial commencing in 1974, on the sole ground of
failure to implead indispensable parties. The rule is settled that the non-joinder of indispensable parties is not a
ground for the dismissal of an action. The remedy is to implead the non-party claimed to be indispensable.
Parties may be added by order of the court on motion of the party or on its own initiative at any stage of the
action and/or at such times as are just. If petitioner refuses to implead an indispensable party despite the order
of the court, the latter may dismiss the complaint/petition for the plaintiff’s/petitioner's failure to comply
therewith.16

WHEREFORE, premises considered, the instant petition is GRANTED, and the case is REMANDED to the trial
court for appropriate proceedings. The trial court is further DIRECTED to decide on the merits of the civil case
WITH DISPATCH.
G.R. No. L-44546 January 29, 1988

RUSTICO ADILLE, petitioner,


vs.
THE HONORABLE COURT OF APPEALS, EMETERIA ASEJO, TEODORICA ASEJO, DOMINGO ASEJO,
JOSEFA ASEJO and SANTIAGO ASEJO, respondents.

SARMIENTO, J.:

In issue herein are property and property rights, a familiar subject of controversy and a wellspring of enormous conflict that has led not only
to protracted legal entanglements but to even more bitter consequences, like strained relationships and even the forfeiture of lives. It is a
question that likewise reflects a tragic commentary on prevailing social and cultural values and institutions, where, as one observer notes,
wealth and its accumulation are the basis of self-fulfillment and where property is held as sacred as life itself. "It is in the defense of his
property," says this modern thinker, that one "will mobilize his deepest protective devices, and anybody that threatens his possessions will
arouse his most passionate enmity." 1

The task of this Court, however, is not to judge the wisdom of values; the burden of reconstructing the social
order is shouldered by the political leadership-and the people themselves.

The parties have come to this Court for relief and accordingly, our responsibility is to give them that relief
pursuant to the decree of law.

The antecedent facts are quoted from the decision 2 appealed from:

xxx xxx xxx

... [T]he land in question Lot 14694 of Cadastral Survey of Albay located in Legaspi City with
an area of some 11,325 sq. m. originally belonged to one Felisa Alzul as her own private
property; she married twice in her lifetime; the first, with one Bernabe Adille, with whom she
had as an only child, herein defendant Rustico Adille; in her second marriage with one
Procopio Asejo, her children were herein plaintiffs, — now, sometime in 1939, said Felisa sold
the property in pacto de retro to certain 3rd persons, period of repurchase being 3 years, but
she died in 1942 without being able to redeem and after her death, but during the period of
redemption, herein defendant repurchased, by himself alone, and after that, he executed a
deed of extra-judicial partition representing himself to be the only heir and child of his mother
Felisa with the consequence that he was able to secure title in his name alone also, so that
OCT. No. 21137 in the name of his mother was transferred to his name, that was in 1955; that
was why after some efforts of compromise had failed, his half-brothers and sisters, herein
plaintiffs, filed present case for partition with accounting on the position that he was only a
trustee on an implied trust when he redeemed,-and this is the evidence, but as it also turned
out that one of plaintiffs, Emeteria Asejo was occupying a portion, defendant counterclaimed
for her to vacate that, —

Well then, after hearing the evidence, trial Judge sustained defendant in his position that he
was and became absolute owner, he was not a trustee, and therefore, dismissed case and
also condemned plaintiff occupant, Emeteria to vacate; it is because of this that plaintiffs have
come here and contend that trial court erred in:

I. ... declaring the defendant absolute owner of the property;

II. ... not ordering the partition of the property; and

III. ... ordering one of the plaintiffs who is in possession of the portion of the property to vacate
the land, p. 1 Appellant's brief.
which can be reduced to simple question of whether or not on the basis of evidence and law, judgment
appealed from should be maintained. 3

xxx xxx xxx

The respondent Court of appeals reversed the trial Court, 4 and ruled for the plaintiffs-appellants, the private
respondents herein. The petitioner now appeals, by way of certiorari, from the Court's decision.

We required the private respondents to file a comment and thereafter, having given due course to the petition,
directed the parties to file their briefs. Only the petitioner, however, filed a brief, and the private respondents
having failed to file one, we declared the case submitted for decision.

The petition raises a purely legal issue: May a co-owner acquire exclusive ownership over the property held in
common?

Essentially, it is the petitioner's contention that the property subject of dispute devolved upon him upon the
failure of his co-heirs to join him in its redemption within the period required by law. He relies on the provisions
of Article 1515 of the old Civil Article 1613 of the present Code, giving the vendee a retro the right to demand
redemption of the entire property.

There is no merit in this petition.

The right of repurchase may be exercised by a co-owner with aspect to his share alone. 5 While the records
show that the petitioner redeemed the property in its entirety, shouldering the expenses therefor, that did not
make him the owner of all of it. In other words, it did not put to end the existing state of co-ownership.

Necessary expenses may be incurred by one co-owner, subject to his right to collect reimbursement from the
remaining co-owners. 6 There is no doubt that redemption of property entails a necessary expense. Under the
Civil Code:

ART. 488. Each co-owner shall have a right to compel the other co-owners to contribute to the
expenses of preservation of the thing or right owned in common and to the taxes. Any one of
the latter may exempt himself from this obligation by renouncing so much of his undivided
interest as may be equivalent to his share of the expenses and taxes. No such waiver shall be
made if it is prejudicial to the co-ownership.

The result is that the property remains to be in a condition of co-ownership. While a vendee a retro, under
Article 1613 of the Code, "may not be compelled to consent to a partial redemption," the redemption by one co-
heir or co-owner of the property in its totality does not vest in him ownership over it. Failure on the part of all the
co-owners to redeem it entitles the vendee a retro to retain the property and consolidate title thereto in his
name. 7 But the provision does not give to the redeeming co-owner the right to the entire property. It does not
provide for a mode of terminating a co-ownership.

Neither does the fact that the petitioner had succeeded in securing title over the parcel in his name terminate
the existing co-ownership. While his half-brothers and sisters are, as we said, liable to him for reimbursement
as and for their shares in redemption expenses, he cannot claim exclusive right to the property owned in
common. Registration of property is not a means of acquiring ownership. It operates as a mere notice of
existing title, that is, if there is one.

The petitioner must then be said to be a trustee of the property on behalf of the private respondents. The Civil
Code states:

ART. 1456. 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.
We agree with the respondent Court of Appeals that fraud attended the registration of the property. The
petitioner's pretension that he was the sole heir to the land in the affidavit of extrajudicial settlement he
executed preliminary to the registration thereof betrays a clear effort on his part to defraud his brothers and
sisters and to exercise sole dominion over the property. The aforequoted provision therefore applies.

It is the view of the respondent Court that the petitioner, in taking over the property, did so either on behalf of
his co-heirs, in which event, he had constituted himself a negotiorum gestor under Article 2144 of the Civil
Code, or for his exclusive benefit, in which case, he is guilty of fraud, and must act as trustee, the private
respondents being the beneficiaries, under the Article 1456. The evidence, of course, points to the second
alternative the petitioner having asserted claims of exclusive ownership over the property and having acted in
fraud of his co-heirs. He cannot therefore be said to have assume the mere management of the property
abandoned by his co-heirs, the situation Article 2144 of the Code contemplates. In any case, as the respondent
Court itself affirms, the result would be the same whether it is one or the other. The petitioner would remain
liable to the Private respondents, his co-heirs.

This Court is not unaware of the well-established principle that prescription bars any demand on property
(owned in common) held by another (co-owner) following the required number of years. In that event, the party
in possession acquires title to the property and the state of co-ownership is ended . 8 In the case at bar, the
property was registered in 1955 by the petitioner, solely in his name, while the claim of the private respondents
was presented in 1974. Has prescription then, set in?

We hold in the negative. Prescription, as a mode of terminating a relation of co-ownership, must have been
preceded by repudiation (of the co-ownership). The act of repudiation, in turn is subject to certain conditions:
(1) a co-owner repudiates the co-ownership; (2) such an act of repudiation is clearly made known to the other
co-owners; (3) the evidence thereon is clear and conclusive, and (4) he has been in possession through open,
continuous, exclusive, and notorious possession of the property for the period required by law. 9

The instant case shows that the petitioner had not complied with these requisites. We are not convinced that he
had repudiated the co-ownership; on the contrary, he had deliberately kept the private respondents in the dark
by feigning sole heirship over the estate under dispute. He cannot therefore be said to have "made known" his
efforts to deny the co-ownership. Moreover, one of the private respondents, Emeteria Asejo, is occupying a
portion of the land up to the present, yet, the petitioner has not taken pains to eject her therefrom. As a matter
of fact, he sought to recover possession of that portion Emeteria is occupying only as a counterclaim, and only
after the private respondents had first sought judicial relief.

It is true that registration under the Torrens system is constructive notice of title, 10 but it has likewise been our
holding that the Torrens title does not furnish a shield for fraud. 11 It is therefore no argument to say that the act
of registration is equivalent to notice of repudiation, assuming there was one, notwithstanding the long-standing
rule that registration operates as a universal notice of title.

For the same reason, we cannot dismiss the private respondents' claims commenced in 1974 over the estate
registered in 1955. While actions to enforce a constructive trust prescribes in ten years, 12 reckoned from the
date of the registration of the property, 13 we, as we said, are not prepared to count the period from such a date
in this case. We note the petitioner's sub rosa efforts to get hold of the property exclusively for himself
beginning with his fraudulent misrepresentation in his unilateral affidavit of extrajudicial settlement that he is
"the only heir and child of his mother Feliza with the consequence that he was able to secure title in his name
also." 14 Accordingly, we hold that the right of the private respondents commenced from the time they actually
discovered the petitioner's act of defraudation. 15 According to the respondent Court of Appeals, they "came to
know [of it] apparently only during the progress of the litigation." 16 Hence, prescription is not a bar.

Moreover, and as a rule, prescription is an affirmative defense that must be pleaded either in a motion to
dismiss or in the answer otherwise it is deemed waived, 17 and here, the petitioner never raised that
defense. 18 There are recognized exceptions to this rule, but the petitioner has not shown why they apply.

WHEREFORE, there being no reversible error committed by the respondent Court of Appeals, the petition is
DENIED. The Decision sought to be reviewed is hereby AFFIRMED in toto. No pronouncement as to costs.
G.R. No. 76351 October 29, 1993

VIRGILIO B. AGUILAR, petitioner,


vs.
COURT OF APPEALS and SENEN B. AGUILAR, respondents.

Jose F. Manacop for petitioner.

Siruello, Muyco & Associates Law Office for private respondent.

BELLOSILLO, J.:

This is a petition for review on certiorari seeking to reverse and set aside the Decision of the Court of Appeals
in CA-GR CV No. 03933 declaring null and void the orders of 23 and 26 April, 1979, the judgment by default of
26 July 1979, and the order of 22 October 1979 of the then Court of First Instance of Rizal, Pasay City, Branch
30, and directing the trial court to set the case for pre-trial conference.

Petitioner Virgilio and respondent Senen are brothers; Virgilio is the youngest of seven (7) children of the late
Maximiano Aguilar, while Senen is the fifth. On 28 October 1969, the two brothers purchased a house and lot in
Parañaque where their father could spend and enjoy his remaining years in a peaceful neighborhood. Initially,
the brothers agreed that Virgilio's share in the co-ownership was two-thirds while that of Senen was one-third.
By virtue of a written memorandum dated 23 February 1970, Virgilio and Senen agreed that henceforth their
interests in the house and lot should be equal, with Senen assuming the remaining mortgage obligation of the
original owners with the Social Security System (SSS) in exchange for his possession and enjoyment of the
house together with their father.

Since Virgilio was then disqualified from obtaining a loan from SSS, the brothers agreed that the deed of sale
would be executed and the title registered in the meantime in the name of Senen. It was further agreed that
Senen would take care of their father and his needs since Virgilio and his family were staying in Cebu.

After Maximiano Aguilar died in 1974, petitioner demanded from private respondent that the latter vacate the
house and that the property be sold and proceeds thereof divided among them.

Because of the refusal of respondent to give in to petitioner's demands, the latter filed on 12 January 1979 an
action to compel the sale of the house and lot so that the they could divide the proceeds between them.

In his complaint, petitioner prayed that the proceeds of the sale, be divided on the basis of two-thirds (2/3) in
his favor and one-third (1/3) to respondent. Petitioner also prayed for monthly rentals for the use of the house
by respondent after their father died.

In his answer with counterclaim, respondent alleged that he had no objection to the sale as long as the best
selling price could be obtained; that if the sale would be effected, the proceeds thereof should be divided
equally; and, that being a co-owner, he was entitled to the use and enjoyment of the property.

Upon issues being joined, the case was set for pre-trial on 26 April 1979 with the lawyers of both parties
notified of the pre-trial, and served with the pre-trial order, with private respondent executing a special power of
attorney to his lawyer to appear at the pre-trial and enter into any amicable settlement in his behalf.1

On 20 April 1979, Atty. Manuel S. Tonogbanua, counsel for respondent, filed a motion to cancel pre-trial on the
ground that he would be accompanying his wife to Dumaguete City where she would be a principal sponsor in
a wedding.
On 23 April 1979, finding the reasons of counsel to be without merit, the trial court denied the motion and
directed that the pre-trial should continue as scheduled.

When the case was called for pre-trial as scheduled on 26 April 1979, plaintiff and his counsel appeared.
Defendant did not appear; neither his counsel in whose favor he executed a special power of attorney to
represent him at the pre-trial. Consequently, the trial court, on motion of plaintiff, declared defendant as in
default and ordered reception of plaintiff's evidence ex parte.

On 7 May 1979, defendant through counsel filed an omnibus motion to reconsider the order of default and to
defer reception of evidence. The trial court denied the motion and plaintiff presented his evidence.

On 26 July 1979, rendering judgment by default against defendant, the trial court found him and plaintiff to be
co-owners of the house and lot, in equal shares on the basis of their written agreement. However, it ruled that
plaintiff has been deprived of his participation in the property by defendant's continued enjoyment of the house
and lot, free of rent, despite demands for rentals and continued maneuvers of defendants, to delay partition.
The trial court also upheld the right of plaintiff as co-owner to demand partition. Since plaintiff could not agree
to the amount offered by defendant for the former's share, the trial court held that this property should be sold
to a third person and the proceeds divided equally between the parties.

The trial court likewise ordered defendant to vacate the property and pay plaintiff P1,200.00 as rentals 2 from
January 1975 up to the date of decision plus interest from the time the action was filed.

On 17 September 1979, defendant filed an omnibus motion for new trial but on 22 October 1979 the trial court
denied the motion.

Defendant sought relief from the Court of Appeals praying that the following orders and decision of the trial
court be set aside: (a) the order of 23 April 1970 denying defendants motion for postponement of the pre-trial
set on 26 April 1979; (b) the order of 26 April 1979 declaring him in default and authorizing plaintiff to present
his evidence ex-parte; (e) the default judgment of 26 July 1979; and, (d) the order dated 22 October 1979
denying his omnibus motion for new trial.

On 16 October 1986, the Court of Appeals set aside the order of the trial court of 26 April 1979 as well as the
assailed judgment rendered by default., The appellate court found the explanation of counsel for defendant in
his motion to cancel pre-trial as satisfactory and devoid of a manifest intention to delay the disposition of the
case. It also ruled that the trial court should have granted the motion for postponement filed by counsel for
defendant who should not have been declared as in default for the absence of his counsel.

Petitioner now comes to us alleging that the Court of Appeals erred (1) in not holding that the motion of
defendant through counsel to cancel the pre-trial was dilatory in character and (2) in remanding the case to the
trial court for pre-trial and trial.

The issues to be resolved are whether the trial court correctly declared respondent as in default for his failure to
appear at the pre-trial and in allowing petitioner to present his evidence ex-parte, and whether the trial court
correctly rendered the default judgment against respondent.

We find merit in the petition.

As regards the first issue, the law is clear that the appearance of parties at the pre-trial is mandatory.3 A party
who fails to appear at a pre-trial conference may be non-suited or considered as in default.4 In the case at bar,
where private respondent and counsel failed to appear at the scheduled pre-trial, the trial, court has authority to
declare respondent in default.5

Although respondent's counsel filed a motion to postpone pre-trial hearing, the grant or denial thereof is within
the sound discretion of the trial court, which should take into account two factors in the grant or denial of
motions for postponement, namely: (a) the reason for the postponement and (b) the merits of the case of
movant.6

In the instant case, the trial court found the reason stated in the motion of counsel for respondent to cancel the
pre-trial to be without merit. Counsel's explanation that he had to go to by boat as early as 25 March 1979 to
fetch his wife and accompany her to a wedding in Dumaguete City on 27 April 1979 where she was one of the
principal sponsors, cannot be accepted. We find it insufficient to justify postponement of the pre-trial, and the
Court of Appeals did not act wisely in overruling the denial. We sustain the trial court and rule that it did not
abuse its discretion in denying the postponement for lack of merit. Certainly, to warrant a postponement of a
mandatory process as pre-trial would require much more than mere attendance in a social function. It is time
indeed we emphasize that there should be much more than mere perfunctory treatment of the pre-trial
procedure. Its observance must be taken seriously if it is to attain its objective, i.e., the speedy and inexpensive
disposition of cases.

Moreover, the trial court denied the motion for postponement three (3) days before the scheduled pre-trial. If
indeed, counsel for respondent could not attend the pre-trial on the scheduled date, respondent at least should
have personally appeared in order not to be declared as in default. But, since nobody appeared for him, the
order of the trial court declaring him as in default and directing the presentation of petitioner's evidence ex
parte was proper.7

With regard to the merits of the judgment of the trial court by default, which respondent appellate court did not
touch upon in resolving the appeal, the Court holds that on the basis of the pleadings of the parties and the
evidence presented ex parte, petitioner and respondents are co-owners of subject house and lot in equal
shares; either one of them may demand the sale of the house and lot at any time and the other cannot object to
such demand; thereafter the proceeds of the sale shall be divided equally according to their respective
interests.

Private respondent and his family refuse to pay monthly rentals to petitioner from the time their father died in
1975 and to vacate the house so that it can be sold to third persons. Petitioner alleges that respondent's
continued stay in the property hinders its disposal to the prejudice of petitioner. On the part of petitioner, he
claims that he should be paid two-thirds (2/3) of a monthly rental of P2,400.00 or the sum of P1,600.00.

In resolving the dispute, the trial court ordered respondent to vacate the property so that it could be sold to third
persons and the proceeds divided between them equally, and for respondent to pay petitioner one-half (1/2) of
P2,400.00 or the sum of P1,200.00 as monthly rental, conformably with their stipulated sharing reflected in their
written agreement.

We uphold the trial court in ruling in favor of petitioner, except as to the effectivity of the payment of monthly
rentals by respondent as co-owner which we here declare to commence only after the trial court ordered
respondent to vacate in accordance with its order of 26 July 1979.

Article 494 of the Civil Code provides that no co-owner shall be obliged to remain in the co-ownership, and that
each co-owner may demand at any time partition of the thing owned in common insofar as his share is
concerned. Corollary to this rule, Art. 498 of the Code states that whenever the thing is essentially, indivisible
and the co-owners cannot agree that it be, allotted to one of them who shall indemnify the others, it shall be
sold and its proceeds accordingly distributed. This is resorted to (1) when the right to partition the property is
invoked by any of the co-owners but because of the nature of the property it cannot be subdivided or its
subdivision would prejudice the interests of the co-owners, and (b) the co-owners are not in agreement as to
who among them shall be allotted or assigned the entire property upon proper reimbursement of the co-
owners. In one case,8 this Court upheld the order of the trial court directing the holding of a public sale of the
properties owned in common pursuant to Art. 498 of the Civil Code.

However, being a co-owner respondent has the right to use the house and lot without paying any compensation
to petitioner, as he may use the property owned in common long as it is in accordance with the purpose for
which it is intended and in a manner not injurious to the interest of the other co-owners.9 Each co-owner of
property held pro indiviso exercises his rights over the whole property and may use and enjoy the same with no
other limitation than that he shall not injure the interests of his co-owners, the reason being that until a division
is made, the respective share of each cannot be determined and every co-owner exercises, together with his
co-participants joint ownership over the pro indiviso property, in addition to his use and enjoyment of the
same. 10

Since petitioner has decided to enforce his right in court to end the co-ownership of the house and lot and
respondent has not refuted the allegation that he has been preventing the sale of the property by his continued
occupancy of the premises, justice and equity demand that respondent and his family vacate the property so
that the sale can be effected immediately. In fairness to petitioner, respondent should pay a rental of P1,200.00
per month, with legal interest; from the time the trial court ordered him to vacate, for the use and enjoyment of
the other half of the property appertaining to petitioner.

When petitioner filed an action to compel the sale of the property and the trial court granted the petition and
ordered the ejectment of respondent, the co-ownership was deemed terminated and the right to enjoy the
possession jointly also ceased. Thereafter, the continued stay of respondent and his family in the house
prejudiced the interest of petitioner as the property should have been sold and the proceeds divided equally
between them. To this extent and from then on, respondent should be held liable for monthly rentals until he
and his family vacate.

WHEREFORE, the petition is GRANTED. The assailed Decision of the Court of Appeals dated 16 October
1986 is REVERSED and SET ASIDE. The decision of the trial court in Civil Case No. 69.12-P dated 16 July
1979 is REINSTATED, with the modification that respondent Senen B. Aguilar is ordered to vacate the
premises in question within ninety (90) days from receipt of this and to pay petitioner Virgilio B. Aguilar a
monthly rental of P1,200.00 with interest at the legal rate from the time he received the decision of the trial
court directing him to vacate until he effectively leaves the premises.

The trial court is further directed to take immediate steps to implement this decision conformably with Art. 498
of the Civil Code and the Rules of Court. This decision is final and executory.
G.R. No. L-52361 April 27, 1981

SUNSET VIEW CONDOMINIUM CORPORATION, petitioner,


vs.
THE HON. JOSE C. CAMPOS, JR. OF THE COURT OF FIRST INSTANCE, BRANCH XXX, PASAY CITY
and AGUILAR-BERNARES REALTY, respondents.

G.R. No. L-52524 April 27, 1981

SUNSET VIEW CONDOMINIUM CORPORATION, petitioner,


vs.
THE HON. JOSE C. CAMPOS, JR., PRESIDING JUDGE OF THE COURT OF FIRST INSTANCE, BRANCH
XXX, PASAY CITY, and LIM SIU LENG, respondents.

FERNANDEZ, J.:

These two cases which involve similar facts and raise Identical questions of law were ordered consolidated by
resolution of this Court dated March 17, 1980. 1

The petitioner, Sunset View Condominium Corporation, in both cases, is a condominium corporation within the
meaning of Republic Act No. 4726 in relation to a duly registered Amended Master Deed with Declaration of
Restrictions of the Sunset View Condominium Project located at 2230 Roxas Boulevard, Pasay City of which
said petitioner is the Management Body holding title to all the common and limited common areas. 2

G.R. NO. 52361

The private respondent, Aguilar-Bernares Realty, a sole proprietorship with business name registered with the
Bureau of Commerce, owned and operated by the spouses Emmanuel G. Aguilar and Zenaida B. Aguilar, is
the assignee of a unit, "Solana", in the Sunset View Condominium Project with La Perla Commercial,
Incorporated, as assignor. 3 The La Perla Commercial, Incorporated bought the "Solana" unit on installment
from the Tower Builders, Inc. 4 The petitioner, Sunset View Condominium Corporation, filed for the collection of
assessments levied on the unit against Aguilar-Bernares Realty, private respondent herein, a complaint dated
June 22, 1979 docketed as Civil Case No. 7303-P of the Court of First Instance of Pasay City, Branch XXX.
The private respondent filed a Motion to Dismiss the complaint on the grounds (1) that the complaint does not
state a cause of action: (2) that the court has no jurisdiction over the subject or nature other action; and (3) that
there is another action pending between the same parties for the same cause. The petitioner filed its opposition
thereto. The motion to dismiss was granted on December 11, 1979 by the respondent Judge who opined that
the private respondent is, pursuant to Section 2 of Republic Act No. 4726, a "holder of a separate interest" and
consequently, a shareholder of the plaintiff condominium corporation; and that "the case should be properly
filed with the Securities & Exchange Commission which has exclusive original jurisdiction on controversies
arising between shareholders of the corporation." the motion for reconsideration thereof having been denied,
the petitioner, alleging grave abuse of discretion on the part of respondent Judge, filed the instant petition for
certiorari praying that the said orders be set aside.

G.R. NO. 52524

The petitioner filed its amended complaint dated July 16, 1979 docketed as Civil Case No. 14127 of Branch I of
the City Court of Pasay City for the collection of overdue accounts on assessments and insurance premiums
and the interest thereon amounting to P6,168 06 as of March 31, 1979 against the private respondent Lim Siu
Leng 5 to whom was assigned on July 11, 1977 a unit called "Alegria" of the Sunset. View Condominium Project
by Alfonso Uy 6 who had entered into a "Contract to Buy and Sell" with Tower Builders, Inc. over the said unit
on installment basis. 7
The private respondent filed a motion to dismiss on the ground of lack of jurisdiction, alleging that the amount
sought to be collected is an assessment. The correctness and validity of which is certain to involve a dispute
between her and the petitioner corporation; that she has automatically become, as a purchaser of the
condominium unit, a stockholder of the petitioner pursuant to Section 2 of the Condominium Act, Republic Act
No. 4726; that the dispute is intra-corporate and is consequently under the exclusive jurisdiction of the
Securities & Exchange Commission as provided in Section 5 of P.D. No. 902-A. 8

The petitioner filed its opposition thereto, alleging that the private respondent who had not fully paid for the unit
was not the owner thereof, consequently was not the holder of a separate interest which would make her a
stockholder, and that hence the case was not an intra-corporate dispute. 9

After the private respondent had filed her answer to the opposition to the motion to dismiss 10 of the petitioner,
the trial court issued an order dated August 13, 1979 denying the motion to dismiss. 11 The private respondent's
motion for reconsideration thereof was denied by the trial court in its Order dated September 19, 1979. 12

The private respondent then appealed pursuant to Section 10 of Rule 40 of the Rules of Court to the Court of
First Instance, where the appeal was docketed as Civil Case No. 7530P. The petitioner filed its "Motion to
Dismiss Appeal" on the ground that the order of the trial court appealed from is interlocutory. 13

The motion to dismiss the appeal was denied and the parties were ordered to submit their respective
memorandum on the issue raised before the trial court and on the disputed order of the trial judge. 14 After the
parties had submitted their respective memoranda on the matter, the respondent Judge issued an order dated
December 14, 1979 in which he directed that "the appeal is hereby dismissed and d the judgment of the lower
court is reversed. The case is dismissed and the parties are directed to ventilate their controversy with the
Securities & Exchange Commission. 15 The petitioner's motion for reconsideration thereof was denied in an
order dated January 14, 1980. 16 Hence this petition for certiorari, alleging grave abuse of discretion on the part
of the respondent Judge.

Issues Common to Both Cases

It is admitted that the private respondents in both cases have not yet fully paid the purchase price of their units.
The Identical issues raised in both petitions are the following:

1. Is a purchaser of a condominium unit in the condominium project managed by the petitioner, who has not yet
fully paid the purchase price thereof, automaticaly a ,stockholder of the petitioner Condominium Corporation

2. Is it the regular court or the Securities & Exchange Commission that has jurisdiction over cases for collection
of assessments assessed by the Condominium Corporation on condominium units the full purchase price of
which has not been paid?

The private respondents in both cases argue that every purchaser of a condominium unit, regardless of
whether or not he has fully paid the purchase price, is a "holder of a separate interest" mentioned in Section 2
of Republic Act No. 4726, otherwise known as "The Condominium Act" and is automatically a shareholder of
the condominium corporation.

The contention has no merit. Section 5 of the Condominium Act expressly provides that the shareholding in the
Condominium Corporation will be conveyed only in a proper case. Said Section 5 provides:

Any transfer or conveyance of a unit or an apartment, office or other space therein, shall
include the transfer or conveyance of the undivided interests in the common areas or, in a
proper case, the membership or shareholding in the condominium corporation ...

It is clear then that not every purchaser of a condominium unit is a shareholder of the condominium
corporation. The Condominium Act leaves to the Master Deed the determination of when the shareholding will
be transferred to the purchaser of a unit. Thus, Section 4 of said Act provides:
The provisions of this Act shall apply to property divided or to be divided into condominium
only if there shall be recorded in the Register of Deeds of the province or city in which the
property lies and duly annotated in the corresponding certificate of title of the land ... an
enabling or master deed which shall contain, among others, the following:

xxx xxx xxx

(d) Astatement of the exact nature of the interest acquired or to be acquired by the purchaser
in the separate units and in the common areas of the condominium project ...

The Amended Master Deeds in these cases, which were duly registered in the Register of Deeds, and which
contain, by mandate of Section 4, a statement of the exact nature of the interest acquired by a purchaser of a
unit, provide in Section 6 of Part 1:

(d) Each Unit owner shall, as an essential condition to such ownership, acquire stockholding
in the Condominium Corporation herein below provided ... 17

The Amended Master Deeds likewise provide in Section 7 (b), thus.

(b) All unit owners shall of necessity become stockholders of the Condominium Corporation.
TOWER shall acquire all the shares of stock of SUNSET VIEW and shall allocate the said
shares to the units in proportion to the appurtenant interest in the COMMON AREAS and
LIMITED COMMON AREAS as provided in Section 6 (b) above. Said shares allocated are
mere appurtenances of each unit, and therefore, the same cannot be transferred, conveyed,
encumbered or otherwise disposed of separately from the Unit ... 18

It is clear from the above-quoted provisions of the Master Deeds that the shareholding in the Condominium
Corporation is inseparable from the unit to which it is only an appurtenant and that only the owner of a unit is a
shareholder in the Condominium Corporation.

Subparagraph (a) of Part 1, Section 6, of the Master Deeds determines when and under what conditions
ownership of a unit is acquired by a purchaser thus:

(a) The purchaser of a unit shall acquire title or ownership of such Unit, subject to the terms
and conditions of the instrument conveying the unit to such purchaser and to the terms and
conditions of any subsequent conveyance under which the purchaser takes title to the Unit,
and subject further to this MASTER DEED ... 19

The instrument conveying the unit "Solana" in G.R. NO. 52361 is the "Contract to Buy and Sell" dated
September 13, 1977, Annex "D", while that conveying the unit "Alegria" in G.R. NO. 52524 is the "Contract to
Buy and Sell" dated May 12, 1976, Annex "C". In both deeds of conveyance, it is provided:

4. Upon full payment by the BUYER of the total purchase price and full compliance by the
BUYER of an its obligations herein, the SELLER will convey unto the BUYER, as soon as
practicable after completion of the construction, full and absolute title in and to the subject
unit, to the shares of stock pertaining thereto and to an rights and interests in connection
therewith ... 20

The share of stock appurtenant to the unit win be transferred accordingly to the purchaser of the unit only upon
full payment of the purchase price at which time he will also become the owner of the unit. Consequently, even
under the contract, it is only the owner of a unit who is a shareholder of the Condominium Corporation.
Inasmuch as owners is conveyed only upon full payment of the purchase price, it necessarily follows that a
purchaser of a unit who has not paid the full purchase price thereof is not The owner of the unit and
consequently is not a shareholder of the Condominium Corporation.
That only the owner of a unit is a stockholder of the Condominium Corporation is inferred from Section 10 of
the Condominium Act which reads:

SEC. 10. ... Membership in a condominium corporation, regardless of whether it is a stock or


non-stock corporation, shall not be transferable separately from the condominium unit of
which it is an appurtenance When a member or stockholder ceases is to own a unit in the
project in which the condominium corporation owns or holds the common areas, he shall
automatically cease to be a member or stockholder of the condominium corporation.

Pursuant to the above statutory provision, ownership of a unit is a condition sine qua non to being a
shareholder in the condominium corporation. It follows that a purchaser of a unit who is not yet the owner
thereof for not having fully paid the full purchase price, is not a shareholder By necessary implication, the
"separate interest" in a condominium, which entitles the holder to become automatically a share holder in the
condominium corporation, as provided in Section 2 of the Condominium Act, can be no other than ownership of
a unit. This is so because nobody can be a shareholder unless he is the owner of a unit and when he ceases to
be the owner, he also ceases automatically to be a shareholder.

The private respondents, therefore, who have not fully paid the purchase price of their units and are
consequently not owners of their units are not members or shareholders of the petitioner condominium
corporation,

Inasmuch as the private respondents are not shareholders of the petitioner condominium corporation, the
instant case for collection cannot be a "controversy arising out of intracorporate or partnership relations
between and among stockholders, members or associates; between any or all of them and the corporation,
partnership or association of which they are stockholders, members or associates, respectively" which
controversies are under the original and exclusive jurisdiction of the Securities & Exchange Commission,
pursuant to Section 5 (b) of P.D. No. 902- A. The subject matters of the instant cases according to the
allegations of the complaints are under the jurisdiction of the regular courts: that of G.R. NO. 52361, which is
for the collection of P8,335.38 with interest plus attorney's fees equivalent to the principal or a total of more
than P10,000.00 is under the jurisdiction of the Court of First Instance; and that of G.R. NO. 52524, which is for
the collection of P6,168-06 is within the jurisdiction of the City Court.

In view of the foregoing, it is no longer necessary to resolve the issue raised in G.R. NO. 52524 of whether an
order of the City Court denying a motion to dismiss on the ground of lack of jurisdiction can be appealed to the
Court of First Instance.

WHEREFORE, the questioned orders of the respondent Judge dated December 11, 1979 and January 4, 1980
in Civil Case No. 7303-P, subject matter of the Petition in G.R. No. 52361, are set aside and said Judge is
ordered to try the case on the merits. The orders dated December 14, 1979 and January 14, 1980 in Civil Case
No. 7530-P, subject matter of the petition in G.R. No. 52524 are set aside and the case is ordered remanded to
the court a quo, City Court of Pasay City, for trial on the merits, with costs against the private respondents.
G.R. No. L-2812 October 18, 1906

LONGINOS JAVIER, plaintiff-appellee,


vs.
SEGUNDO JAVIER, ET AL., defendants-appellants.

Hartigan, Rohde and Gutierrez, for appellants.


Chicote, Miranda and Sierra, for appellee.

WILLARD, J.:

This case relates to the ownership of the lot, and of the house standing thereon, No. 521 Calle Real, Malate,
Manila. The court below found that the land belonged to the plaintiff as administrator of the estate of his father,
Manuel Javier, and that the defendant Isabel Hernandez and Manuel Ramon Javier, her son, are the owners of
the house standing on the lot. Judgment was rendered in favor of the plaintiff for the possession of the
property, but giving the defendants a reasonable opportunity to remove the house.

The evidence sustains the findings of fact to the effect that the land belongs to the estate represented by the
plaintiff. There was evidence to show that the land was, in 1860, in the possession of Manuel Javier, the father
of the defendant Segundo Javier, and that since that time it has been occupied by his children and that no one
of these children ever made any claim to the ownership thereof, and no one them ever occupied the property
as owner.

Manuel Ramon Javier, testifying as a witness, made no claim to the ownership of the land, and testified simply
that the result of his investigations into the question of ownership showed that there was a great confusion in
regard thereto.

The appellants claim that this action can not be maintained by the administrator of the estate of Manuel Javier,
but that it should be maintained by all the heirs of the deceased. The right of judicial administrator to recover
the possession of real property belonging to the estate of the deceased was recognized in the case of
Alfonso vs.Natividad 1 (4 Off. Gaz., 461; secs. 702, 703, and 704 of the Code of Civil Procedure).

The appellants claim in their brief that they were possessors in good faith, and by reason thereof and of the
provisions of article 451 of the Civil Code they can not be compelled to pay rent. It is to be observed, however,
that the appellants do not come within the definition of a possessor in good faith found in article 433 of the Civil
Code cited in their brief. As said by the appellants themselves in that brief, the two defendants, Segundo Javier
and his wife, Isabel Hernandez, always believed that the land did not belong to them but belonged to the estate
of Manuel Javier. It is to be observed, moreover, that the judgment of the court does not allow any recovery at
all for the use or occupation of the house, and the recovery of rent for the use of the land is limited to the time
elapsed since April 24, 1904, when a demand was made upon the defendants for the possession of the
property.

It is also claimed by the appellants that, in accordance with article 453 of the Civil Code, they are entitled to be
reimbursed for the expenses of constructing the house. These expenses are only allowed in accordance with
the article cited by the appellants to a possession in good faith, and the appellants were not such possessors. lawphil.net

It is claimed finally by the appellants that the case should be decided by an application of the principles of law
meant that community of property existed because the house was owned by the appellants and the land by the
plaintiff, the contention can not be maintained, for such a condition of affairs does not create a community of
property within the meaning of that term as it is used in title 3, book 2 of the Civil Code. If, on the other hand, it
is itself belonged to the heirs of Manuel Javier, and that two of the defendants were such heirs, it can be said
that the decision of the court below was fully as favorable to the appellants as it could be.
Article 397 of the Civil Code relates to improvements made upon the common property by one of the coowners.
The burden of proof was on the appellants to show that the house was built with the consent of their cotenants.
Even if a tacit consent was shown this would not require such cotenants to pay for the house. (8 Manresa,
Commentaries on Civil Code, p. 396.)

The judgment of the court below allowed the appellants to remove the house within a reasonable time. Whether
this judgment was erroneous as far as the appellee is concerned, we need not inquire, because he has not
appealed from the judgment.

The judgment of the court below is affirmed, with the costs of this instance against the appellants.

After the expiration of twenty days from the date hereof let judgment be entered in accordance herewith and
ten days thereafter let the case remanded to the court below for proper action. So ordered.
G.R. No. L-14429 June 30, 1962

RAMON MERCADO, BASILIA MERCADO joined by her husband,


FRANCISCO RONQUILLO, plaintiffs-appellants,
vs.
PIO D. LIWANAG, defendant-appellee.

Patricio D. Senador and Ricardo D. Galano for plaintiffs-appellants.


D. B. Melliza and D. M. Gangoso for defendant-appellee.

MAKALINTAL, J.:

The present appeal, taken by the plaintiff from the decision of the Court of First Instance of Rizal (Quezon City),
is before us on a certification by the Court of Appeals, the questions involved being purely legal. The case was
submitted to the trial court upon the following stipulation of facts:

1. That the complaint filed by the plaintiffs against the defendant seeks to annul a Deed of Sale on the
ground of fraud and on the provisions of Article 493 of the Civil Code.

2. That on July 14, 1956, in the City of Manila, Philippines, the plaintiff Ramon Mercado and the
defendant Pio D. Liwanag executed a Deed of Sale, photostat copy of which is attached hereto
marked as Annex "A" and forming an integral hereof, covering a divided half and described in meter
and bounds, or an area of 2,196 square meters at P7.00 per square meter or for a total amount of
P15,372.00, of a parcel of land situated at Kangkong, Quezon City, covered Transfer Certificate of
Title No. 20805 of the Register of Deeds for the province of Rizal, now Quezon City:

3. That the said T.C.T. No. 20805 containing an area of 4,392 square meters, is issued in the name of
the plaintiffs Ramon Mercado and Basilia Mercado as co-owners PRO-INDIVISO, and the sale was
without the knowledge and consent of plaintiff Basilia Mercado;

4. That out of the total area of 4,392 square meters, an area consisting of 391 square meters was
expropriated by the National Power Corporation sometime in December 1953 at a price of P10.00 per
square meter, Civil Case No. Q-829 (Eminent Domain) of the Court of First Instance of Rizal, Quezon
City Branch, entitled "National Power Corporation, plaintiff, versus Brigido Almodoban, et als.,
defendants," but this fact of expropriation came to the knowledge of the defendant Pio D. Liwanag
upon the registration of the Deed of Sale Annex "A". .

5. That pursuant to the Deed of Sale Annex "A" T.C.T. No. 32757 was issued in the name of Pio
Liwanag and Basilia photostat copy of which is hereto attached and marked as Annex "B".

6. That defendant submits the receipt signed by plaintiff Ramon Mercado dated July 14, 1956
photostat copy of which is attached hereto and marked as Annex "C" and promissory note of the same
date for P10,000.00, photostat copy of which is attached hereto and marked is Annex "D" which are
both self-explanatory, but plaintiff Ramon Mercado disclaims payment and receipt of such check and
promissory note, the check being uncashed and is still in the possession of Atty. Eugenio de Garcia;

7. That plaintiffs and defendant respectfully submit for resolution of this Honorable Court the issue of
whether or not the Deed of Sale Annex "A" court be annulled based in the foregoing facts in relation to
Article 493 of the Civil Code, setting aside all other issues in the pleadings.

Upon the issue thus presented the trial court held that under Article 493 of the Civil Code the sale in question
was valid and so dismissed the complaint, without costs. This ruling is now assailed as erroneous.

Article 493 provides:


Each co-owner shall have the full ownership of his part and of the fruits and benefits pertaining thereto,
and he may therefore alienate, assign or mortgage it, and even substitute another person in its
enjoyment, except when personal rights are involved. But the effect of the alienation or the mortgage,
with respect to the co-owners, shall be limited to the portion which may be alloted to him in the division
upon the termination of the co-ownership.

Appellants except to the application of this provision in this case for the reason that in the deed of sale sought
to be annulled the vendor disposed of a divided and determinate half of the land under co-ownership. The
argument, as far as it goes, seems to be tenable. What a co-owner may dispose of under Article 493 is only his
undivided aliquot share, which shall be limited to the portion which may be allotted to him upon the termination
of the co-ownership. He has no right to divide the property into parts and then convey one part by metes and
bounds. Lopez vs. Ilustre, 5 Phil. 567; Gonzales, et al. vs. Itchon, et al., 47 O.G. 6290; Manresa, Vol. 3, 7th ed.
p. 630.

The pertinent recitals in the disputed deed of sale read:

I hereby sell, transfer and convey absolutely and irrevocably unto said Pio D. Liwanag, his heirs,
successors, and assigns my rights, title and interest on my chosen portion of the above described
property which consist of one-half of aforesaid ownership bounded on the West by Pacifico Gahudo,
on the North by Hacienda de Piedad and on the South by Circumferential Road, consisting of 50
meters more or less frontal length along Circumferential Road, and with a total area of 2,196 square
meters as indicated in Co-owners Transfer Certificate of Title No. 20805.

Nevertheless, upon registration of the sale and cancellation of transfer certificate of title No. 20805 in the
names of the previous co-owners, the new transfer certificate that was issued (No. 32757) did not reproduce
the description in the instrument but carried the names of appellee Pio D. Liwanag and Basilia Mercado as "co-
owners pro-indiviso." There is no suggestion by any of the parties that this new certificate of title is invalid,
irregular or inaccurate. There is no prayer that it be canceled. As far as Basilia Mercado is concerned she
retains in all their integrity her rights as co-owner which she had before the sale, and consequently, she has no
cause to complain. Much less has Ramon Mercado, for it was he who was responsible for whatever indicia
there may be in the deed of sale that a determinate portion of the property was being sold, as shown by the
second paragraph thereof, quoted without contradiction in appellee's brief as follows:

That the aforesaid Transfer Certificate of Title was originally in my name, but was split into two equal
parts by virtue of my desire to donate to my sister-in-law Juana Gregorio an equal half thereof with the
understanding that I as donor would have the absolute power to choose from the property owned in
common that part which I would like to segregate for myself or my heir and assigns.

And of course appellee himself not only does not challenge the new certificate of title, wherein he appears as
co-owner of an undivided one-half share, but precisely relies upon it for his defense in this action.

The title is the final and conclusive repository of the rights of the new co-owners. The question of whether or
not the deed of sale should be annulled must be considered in conjunction with the title issued pursuant
thereto. Since, according to this title, what appellee acquired by virtue of the sale is only an undivided half-
share of the property, which under the law the vendor Ramon Mercado had the absolute right to dispose of, the
trial court committed no error in dismissing the action. The end-result of the transaction is in accordance with
Article 493 of the Civil Code.
1äwphï1.ñët

The other point raised by appellants refers to the statement in the dispositive portion of the decision appealed
from that "the stipulation with regards to the deed of sale based on the ground of fraud is insufficient for all
purposes and besides, no proof showing the allegation of such fraud exists in the accord." It is contended that
the trial court erred in making such statement, the same being contrary to the stipulation in which the parties
expressly eliminated the issue of fraud. From the entire context of the decision, however, it can be gathered
that the case was not decided on the basis of the said issue. In any event, even if the court did err in
considering the question of fraud in spite of the stipulation, the error is not a prejudicial one. As far as the
dismissal of the actions concerned, it makes no difference whether fraud has not been proven or fraud has
been abandoned as an issue by express agreement. WHEREFORE, the decision appealed from is affirmed,
with costs against appellants in this instance.
G.R. No. 102380 January 18, 1993

HERODOTUS P. ACEBEDO and DEMOSTHENES P. ACEBEDO, petitioners,


vs.
HON. BERNARDO P. ABESAMIS, MIGUEL ACEBEDO, ALEXANDER ACEBEDO, NAPOLEON ACEBEDO,
RIZALINO ACEBEDO, REPUBLICA ACEBEDO, FILIPINAS ACEBEDO and YU HWA PING, respondents.

Heminio L. Ruiz for petitioners.

Vicente D. Millora for private respondents.

Romero A. Yu for respondent Yu Hua Ping.

CAMPOS, JR., J.:

The lower court's jurisdiction in approving a Deed of Conditional Sale executed by respondents-heirs and
ordering herein administrator-petitioner Herodotus Acebedo to sell the remaining portions of said properties,
despite the absence of its prior approval as a probate court, is being challenged in the case at bar.

The late Felix Acebedo left an estate consisting of several real estate properties located in Quezon City and
Caloocan City, with a conservative estimated value of about P30 million. Said estate allegedly has only the
following unsettled claims:

a. P87,937.00 representing unpaid real estate taxes due Quezon City;

b. P20,244.00 as unpaid real estate taxes due Caloocan City;

c. The unpaid salaries/allowances of former Administrator Miguel Acebedo, and the


incumbent Administrator Herodotus Acebedo; and

d. Inheritance taxes that may be due on the net estate.

The decedent was succeeded by eight heirs, two of whom are the petitioners herein, and the others are the
private respondents.

Due to the prolonged pendency of the case before the respondent Court for sixteen years, respondents-heirs
filed a "Motion for Approval of Sale", on October 4, 1989. The said sale involved the properties covered by
Transfer Certificate of Title Nos. 155569, 120145, 9145, and 18709, all of which are registered in Quezon City,
and form part of the estate. The consideration for said lots was twelve (12) million pesos and by that time, they
already had a buyer. It was further stated in said Motion that respondents-heirs have already received their
proportionate share of the six (6) million pesos paid by the buyer, Yu Hwa Ping, as earnest money; that the
balance of P6,000,000.00 is more than enough to pay the unsettled claims against the estate. Thus, they
prayed for the Court to direct the administrator, Herodotus Acebedo (referred to as petitioner-administrator
hereafter):

1. to sell the properties mentioned in the motion;

2. with the balance of P6 million, to pay all the claims against the Estate; and

3. to distribute the residue among the Heirs in final settlement of the Estate.

To the aforesaid Motion, herein petitioner-administrator interposed an "Opposition to Approval of Sale", to wit:
1. That he has learned that some of the heirs herein have sold some real estate property of
the Estate located at Balintawak, Quezon City, without the knowledge of the herein
administrator, without the approval of this Honorable Court and of some heirs, and at a
shockingly low price;

2. That he is accordingly hereby registering his vehement objection to the approval of the
sale, perpetrated in a manner which can even render the proponents of the sale liable for
punishment for contempt of this Honorable Court;

3. The herein Administrator instead herein prays this Honorable Court to authorize the sale of
the above mentioned property of the Estate to generate funds to pay certain liabilities of the
Estate and with the approval of this Honorable Court if warranted, to give the heirs some
advances chargeable against theirs (sic) respective shares, and, for the purpose to authorize
the herein Administrator, and the other heirs to help the Administrator personally or through a
broker, to look for a buyer for the highest obtainable price, subject always to the approval of
this Honorable Court.1

On October 30, 1989, herein petitioners moved to be given a period of forty-five (45) days within which to look
for a buyer who will be willing to buy the properties at a price higher than P12,000,000.00.

The case was set for hearing on December 15, 1989. However, by said date, petitioners have not found any
buyer offering better terms. Thus, they asked the Court, on February 8, 1990, for an in extendible period of
thirty days to look for a buyer.

Petitioner-administrator then filed a criminal complaint for falsification of a public document against Yu Hwa
Ping and notary public Eugenio Obon on February 26, 1990. He initiated this complaint upon learning that it
was Yu Hwa Ping who caused the notarization of the Deed of Conditional Sale wherein allegedly petitioner-
administrator's signature was made to appear. He also learned that after he confronted the notary public of the
questioned document, the latter revoked his notarial act on the same.

On April 2, 1990, petitioner-administrator filed the civil action to secure the declaration by the Court of the nullity
of the Deed of Conditional Sale and the Deed of Absolute Sale.

The period granted herein petitioners having lapsed without having found a buyer, petitioner Demosthenes
Acebedo sought to nullify the Orders granting them several periods within which to look for a better buyer.
Respondents filed a comment thereon.

Having miserably failed to find a better buyer, after seven long months, petitioner-administrator filed another
"Opposition to Approval of Sale", dated May 10, 1990, maintaining that the sale should wait for the country to
recover from the effects of the coup d'etat attempts, otherwise, the properties should be divided among the
heirs.

On June 21, 1990, petitioners filed a "Motion for Leave of Court to Mortgage and Lease some of the Properties
of the Estate". To this Motion, respondents filed an Opposition on the following grounds : that the motion is not
proper because of the pending motion to approve the sale of the same properties; that said conditional sale
was initiated by petitioner-administrator who had earlier signed a receipt for P500,000.00 as earnest money;
that the approval of the sale would mean Yu Hwa Ping's assumption of payment of the realty taxes; that the
estate has no further debts and thus, the intestate administrator may be terminated.

On August 17, 1990, respondent Court issued an Order, the dispositive portion of which, stated, among others,
to wit:2

b. the motion filed by the heirs-movants, dated October 4, 1989, praying that the new
administrator be directed to sell the properties covered by TCT Nos. 155569, 120145, 9145
and 18709, in favor of Yu Hwa Ping is hereby denied; and
c. the new administrator is hereby granted leave to mortgage some properties of the estate at
a just and reasonable amount, subject to the approval of the Court.

On December 4, 1990, the respondent Judge issued an order resolving to call the parties to a conference on
December 17, 1990. The conference was held, but still the parties were unable to arrive at an agreement. So,
on January 4, 1991, it was continued, wherein the parties actually agreed that the heirs be allowed to sell their
shares of the properties to Yu Hwa Ping for the price already agreed upon, while herein petitioners negotiate
for a higher price with Yu Hwa Ping.

Petitioners, then, instead filed a "Supplemental Opposition" to the approval of the Deed of Conditional Sale.

On March 29, 1991, the respondent Court issued the challenged Order, the dispositive portion of which states,
to wit:

WHEREFORE, the Order dated August 7, 1990, is hereby lifted, reconsidered and set aside,
and another one is hereby issued as follows:

1. Approving the conditional sale, dated September 10, 1989, executed by the heirs-movants,
in favor of Yu Hwa Ping, pertaining to their respective shares in the properties covered by
TCT Nos. 155569, 120145, 1945 and 18709 of the Register of Deeds of Quezon City;

2. Ordering the administrator Herodotus Acebedo to sell the remaining portions of the said
properties also in favor of Yu Hwa Ping at the same price as the sale executed by the herein
heirs-movants;

3. Ordering Yu Hwa Ping to deposit with the Court the total remaining balance of the purchase
price for the said lots within TWENTY (20) DAYS from notice hereof;

4. The motion to cite former administrator Miguel Acebedo in contempt of court, resulting from
his failure to submit the owner's copy of TCT Nos. 155569, and 120145 is hereby denied. 3

Yu Hwa Ping, on April 4, 1991, deposited the remaining balance of the purchase price for the properties subject
of the Deed of Conditional Sale in the amount of P6,500,000.00.

Petitioners herein received the questioned Order on April 11, 1991. Twenty one (21) days thereafter, they filed
a Motion for Reconsideration, praying that the Court reinstate its Order of August 17, 1990. To this, private
respondents filed their Opposition.4

Instead of making a reply, petitioners herein filed a Supplemental Motion for Reconsideration. The motions for
reconsideration of herein petitioners were denied by the respondent Court on August 23, 1991.

On September 23, 1991, herein petitioners filed a Motion for Partial Reconsideration, hoping for the last time
that they would be able to convince the Court that its Order dated March 29, 1991 in effect approving the
conditional sale is erroneous and beyond its jurisdiction.

On October 17, 1991, the respondent Court denied the Motion for Partial Reconsideration for "lack of merit".

On November 7, 1991, private respondents filed a Motion for Execution of the Order dated March 29, 1991.
This was pending resolution when the petitioners filed this Petition for Certiorari.

The controversy in the case at bar revolves around one question: Is it within the jurisdiction of the lower court,
acting as a probate court, to issue an Order approving the Deed of Conditional Sale executed by respondents-
heirs without prior court approval and to order herein Administrator to sell the remaining portion of said
properties?
We answer in the positive?

In the case of Dillena vs. Court of Appeals,5 this Court made a pronouncement that it is within the jurisdiction of
the probate court to approve the sale of properties of a deceased person by his prospective heirs before final
adjudication. Hence, it is error to say that this matter should be threshed out in a separate action.

The Court further elaborated that although the Rules of Court do not specifically state that the sale of an
immovable property belonging to an estate of a decedent, in a special proceeding, should be made with the
approval of the court, this authority is necessarily included in its capacity as a probate court. Therefore, it is
clear that the probate court in the case at bar, acted within its jurisdiction in issuing the Order approving the
Deed of Conditional Sale.

We cannot countenance the position maintained by herein petitioners that said conditional sale is null and void
for lack of prior court approval. The sale precisely was made conditional, the condition being that the same
should first be approved by the probate court.

Petitioners herein anchor their claim on Section 7, Rule 89 of the Rules of Court.6 It is settled that court
approval is necessary for the validity of any disposition of the decedent's estate. However, reference to judicial
approval cannot adversely affect the substantive rights of the heirs to dispose of their ideal share in the co-
heirship and/or co-ownership among the heirs.7

This Court had the occasion to rule that there is no doubt that an heir can sell whatever right, interest, or
participation he may have in the property under administration. This is a matter which comes under the
jurisdiction of the probate court.8

The right of an heir to dispose of the decedent's property, even if the same is under administration, is based on
the Civil Code provision9 stating that the possession of hereditary property is deemed transmitted to the heir
without interruption and from the moment of the death of the decedent, in case the inheritance is accepted.
Where there are however, two or more heirs, the whole estate of the decedent is, before its partition, owned in
common by such heirs. 10

The Civil Code, under the provisions on co-ownership, further qualifies this right.11 Although it is mandated that
each co-owner shall have the full ownership of his part and of the fruits and benefits pertaining thereto, and
thus may alienate, assign or mortgage it, and even substitute another person in its enjoyment, the effect of the
alienation or the mortgage, with respect to the
co-owners, shall be limited to the portion which may be allotted to him in the division upon the termination of
the co-ownership.12 In other words, the law does not prohibit a co-owner from selling, alienating or mortgaging
his ideal share in the property held in common.13

As early as 1942, this Court has recognized said right of an heir to dispose of property under administration. In
the case of Teves de Jakosalem vs. Rafols, et al.,14 it was said that the sale made by an heir of his share in an
inheritance, subject to the result of the pending administration, in no wise, stands in the way of such
administration. The Court then relied on the provision of the Old Civil Code, Article 440 and Article 339 which
are still in force as Article 533 and Article 493, respectively, in the new Civil Code. The Court also cited the
words of a noted civilist, Manresa: "Upon the death of a person, each of his heirs 'becomes the undivided
owner of the whole estate left with respect to the part or portion which might be adjudicated to him, a
community of ownership being thus formed among the co-owners of the estate which remains undivided'."

Private respondents having secured the approval of the probate court, a matter which is unquestionably within
its jurisdiction, and having established private respondents' right to alienate the decedent's property subject of
administration, this Petition should be dismissed for lack of merit.

PREMISES considered, Petition is hereby DISMISSED. With Costs.


G.R. No. 78178 April 15, 1988

DELIA BAILON-CASILAO, LUZ PAULINO-ANG, EMMA PAULINO-YBANEZ, NILDA PAULINO-


TOLENTINO, and SABINA BAILON, petitioners,
vs.
THE HONORABLE COURT OF APPEALS and CELESTINO AFABLE, respondents.

Veronico E. Rubio for petitioners.

Mario G. Fortes for private-respondent.

CORTES, J.:

The fate of petitioners' claim over a parcel of land rests ultimately on a determination of whether or not said petitioners are chargeable with
such laches as may effectively bar their present action.

The petitioners herein filed a case for recovery of property and damages with notice of lis pendens on March
13, 1981 against the defendant and herein private respondent, Celestino Afable. The parcel of land involved in
this case, with an area of 48,849 square meters, is covered by Original Certificate of Title No. 1771 issued on
June 12, 1931, in the names of Rosalia, Gaudencio, Sabina Bernabe, Nenita and Delia, all surnamed Bailon,
as co-owners, each with a 1/6 share. Gaudencio and Nenita are now dead, the latter being represented in this
case by her children. Luz, Emma and Nilda. Bernabe went to China in 1931 and had not been heard from since
then [Decision of the Court of Appeals, Rollo, p. 39].

It appears that on August 23, 1948, Rosalia Bailon and Gaudencio Bailon sold a portion of the said land
consisting of 16,283 square meters to Donato Delgado. On May 13, 1949, Rosalia Bailon alone sold the
remainder of the land consisting of 32,566 square meters to Ponciana V. Aresgado de Lanuza. On the same
date, Lanuza acquired from Delgado the 16,283 square meters of land which the latter had earlier acquired
from Rosalia and Gaudencio. On December 3, 1975, John Lanuza, acting under a special power of attorney
given by his wife, Ponciana V. Aresgado de Lanuza, sold the two parcels of land to Celestino Afable, Sr.

In all these transfers, it was stated in the deeds of sale that the land was not registered under the provisions of
Act No. 496 when the fact is that it is. It appears that said land had been successively declared for taxation first,
in the name of Ciriaca Dellamas, mother of the registered co-owners, then in the name of Rosalia Bailon in
1924, then in that of Donato Delgado in 1936, then in Ponciana de Lanuza's name in 1962 and finally in the
name of Celestino Afable, Sr. in 1983.

In his answer to the complaint filed by the herein petitioners, Afable claimed that he had acquired the land in
question through prescription and contended that the petitioners were guilty of laches.He later filed a third-party
complaint against Rosalia Bailon for damages allegedly suffered as a result of the sale to him of the land.

After trial, the lower court rendered a decision:

1. Finding and declaring Celestino Afable, a co-owner of the land described in paragraph III of
the complaint having validly bought the two-sixth (2/6) respective undivided shares of Rosalia
Bailon and Gaudencio Bailon;

2. Finding and declaring the following as pro-indiviso co-owners, having 1/6 share each, of the
property described in paragraph III of the complaint, to wit:

a. Sabina Bailon

b. Bernabe Bailon
c. Heirs of Nenita Bailon-Paulino

d. Delia Bailon-Casilao;

3. Ordering the segregation of the undivided interests in the property in order to terminate co-
ownership to be conducted by any Geodetic Engineer selected by the parties to delineate the
specific part of each of the co-owners.

4. Ordering the defendant to restore the possession of the plaintiffs respective shares as well
as all attributes of absolute dominion;

5. Ordering the defendant to pay the following:

a. P5,000.00 as damages;

b. P2,000.00 as attorney's fees and;

c. to pay the costs.

[Decision of the Trial Court, Rollo, p. 37-38].

On appeal, the respondent Court of Appeals affirmed the decision of the lower court insofar as it held that
prescription does not he against plaintiffs-appellees because they are co-owners of the original vendors.
However, the appellate court declared that, although registered property cannot be lost by prescription,
nevertheless, an action to recover it may be barred by laches, citing the ruling in Mejia de Lucaz v.
Gamponia [100 Phil. 277 (1956)]. Accordingly, it held the petitioners guilty of laches and dismissed their
complaint. Hence, this petition for review on certiorari of the decision of the Court of Appeals.

The principal issue to be resolved in this case concerns the applicability of the equitable doctrine of laches.
Initially though, a determination of the effect of a sale by one or more co-owners of the entire property held in
common without the consent of all the co-owners and of the appropriate remedy of the aggrieved co-owners is
required.

The rights of a co-owner of a certain property are clearly specified in Article 493 of the Civil Code.Thus:

Art. 493. Each co-owner shall have the full ownership of his part and of the acts and benefits
pertaining thereto, and he may therefore alienate assign or mortgage it and even substitute
another person in its enjoyment, except when personal rights are involved. But the effect of
the alienation or mortgage, with respect to the co-owners, shall be limited to the portion which
may be allotted to him in the division upon the termination of the co-ownership. [Emphasis
supplied.]

As early as 1923, this Court has ruled that even if a co-owner sells the whole property as his, the sale will affect
only his own share but not those of the other co-owners who did not consent to the sale [Punsalan v. Boon Liat
44 Phil. 320 (1923)]. This is because under the aforementioned codal provision, the sale or other disposition
affects only his undivided share and the transferee gets only what would correspond to his grantor in the
partition of the thing owned in common.[Ramirez v. Bautista, 14 Phil. 528 (1909)]. Consequently, by virtue of
the sales made by Rosalia and Gaudencio Bailon which are valid with respect to their proportionate shares,
and the subsequent transfers which culminated in the sale to private respondent Celestino Afable, the said
Afable thereby became a co-owner of the disputed parcel of land as correctly held by the lower court since the
sales produced the effect of substituting the buyers in the enjoyment thereof [Mainit v. Bandoy, 14 Phil. 730
(1910)].
From the foregoing, it may be deduced that since a co-owner is entitled to sell his undivided share, a sale of the
entire property by one co-owner without the consent of the other co-owners is not null and void. However, only
the rights of the co-owner-seller are transferred, thereby making the buyer a co-owner of the property.

The proper action in cases like this is not for the nullification of the sale or for the recovery of possession of the
thing owned in common from the third person who substituted the co-owner or co-owners who alienated their
shares, but the DIVISION of the common property as if it continued to remain in the possession of the co-
owners who possessed and administered it [Mainit v. Bandoy, supra.]

Thus, it is now settled that the appropriate recourse of co-owners in cases where their consent were not
secured in a sale of the entire property as well as in a sale merely of the undivided shares of some of the co-
owners is an action. for PARTITION under Rule 69 of the Revised Rules of Court. Neither recovery of
possession nor restitution can be granted since the defendant buyers are legitimate proprietors and possessors
in joint ownership of the common property claimed [Ramirez v. Bautista, supra].

As to the action for petition, neither prescription nor laches can be invoked.

In the light of the attendant circumstances, defendant-appellee's defense of prescription is a vain proposition.
Pursuant to Article 494 of the Civil Code, '(n)o co-owner shall be obliged to remain in the co-ownership. Such
co-owner may demand at anytime the partition of the thing owned in common, insofar as his share is
concerned.' [Emphasis supplied.] In Budiong v. Bondoc [G.R. No. L-27702, September 9, 1977, 79 SCRA 241,
this Court has interpreted said provision of law to mean that the action for partition is imprescriptible or cannot
be barred by prescription. For Article 494 of the Civil Code explicitly declares: "No prescription shall lie in favor
of a co-owner or co- heir so long as he expressly or impliedly recognizes the co-ownership."

Furthermore, the disputed parcel of land being registered under the Torrens System, the express provision of
Act No. 496 that '(n)o title to registered land in derogation to that of the registered owner shall be acquired by
prescription or adverse possession' is squarely applicable. Consequently, prescription will not lie in favor of
Afable as against the petitioners who remain the registered owners of the disputed parcel of land.

It is argued however, that as to the petitioners Emma, Luz and Nelda who are not the registered co-owners but
merely represented their deceased mother, the late Nenita Bailon, prescription lies.Respondents bolster their
argument by citing a decision of this Court in Pasion v. Pasion [G.R.No. L-15757, May 31, 1961, 2 SCRA 486,
489] holding that "the imprescriptibility of a Torrens title can only be invoked by the person in whose name the
title is registered" and that 'one who is not the registered owner of a parcel of land cannot invoke
imprescriptibility of action to claim the same.'

Reliance on the aforesaid Pasion case is futile. The ruling therein applies only against transferees other than
direct issues or heirs or to complete strangers. The rational is clear:

If prescription is unavailing against the registered owner, it must be equally unavailing against
the latter's hereditary successors, because they merely step into the shoes of the decedent by
operation of law (New Civil Code, Article 777; Old Civil Code, Article 657), the title or right
undergoing no change by its transmission mortis causa [Atus, et al., v. Nunez, et al., 97 Phil.
762, 764].

The latest pronouncement of this Court in Umbay v. Alecha [G. R. No. 67284, March 18, 1985, 135 SCRA 427,
429], which was promulgated subsequent to the Pasion case reiterated the Atus doctrine. Thus:

Prescription is unavailing not only against the registered owner but also against his hereditary
successors, because they merely step into the shoes of the decedent by operation of law and
are merely the continuation of the personality of their predecessor-in-interest. [Barcelona v.
Barcelona, 100 Phil. 251, 257].

Laches is likewise unavailing as a shield against the action of herein petitioners.


Well-stated in this jurisdiction are the four basic elements of laches, namely: (1) conduct on the part of the
defendant or of one under whom he claims, giving rise to the situation of which complaint is made and for
which the complainant seeks a remedy; (2) delay in asserting the corporations complainant's rights, the
complainant having had knowledge or notice of the defendant's conduct and having been afforded an
opportunity to institute suit; (3) lack of knowledge or notice on the part of the defendant that the complainant
would assert the right on which he bases his suit; and, (4) injury or prejudice to the defendant in the event relief
is accorded to the complainant, or the suit is not held to be barred [Go China Gun, et al. v. Co Cho et al., 96
Phil. 622 (1955)].

While the first and last elements are present in this case, the second and third elements are missing.

The second element speaks of delay in asserting the complainant's rights. However, the mere fact of delay is
insufficient to constitute, laches. It is required that (1) complainant must have had knowledge of the conduct of
defendant or of one under whom he claims and (2) he must have been afforded an opportunity to institute suit.
This court has pointed out that laches is not concerned with the mere lapse of time. Thus:

Laches has been defined as the failure or neglect, for an unreasonable length of time to do
that which by exercising due diligence could or should have been done earlier; it is negligence
or omission to assert a right within a reasonable time warranting a presumption that the party
entitled to assert it either has abandoned it or declined to assert it. Tijam, et al., v.
Sibonghanoy, G.R. No. L-21450, April 25, 1968, 23 SCRA 29,35; Tendo v. Zamacoma, G.R.
No. L-63048, August 7, 1985, 138 SCRA 78, 90].

The doctrine of "laches" or of "stale demands" is based upon grounds of public policy which
requires for the peace of society, the discouragement of stale claims and unlike the statute of
limitations, is not a mere question of time but is principally a question of inequity or
unfairness of permitting a right or claim to be enforced or asserted," [Tijam v.
Sibonghanoy, supra, p. 35]. [Emphasis supplied.]

It must be noted that while there was delay in asserting petitioners' rights, such delay was not attended with
any knowledge of the sale nor with any opportunity to bring suit. In the first place, petitioners had no notice of
the sale made by their eldest sister. It is undisputed that the petitioner co-owners had entrusted the care and
management of the parcel of land to Rosalia Bailon who was the oldest among them [TSN, July 27, 1983, p.
14]. In fact, Nicanor Lee, a son of Rosalia, who was presented as a witness by the plaintiffs-petitioners, testified
on cross-examination that his mother was only the administrator of the land as she is the eldest and her
brothers and sisters were away [TSN, October 5, 1983, p. 15]. Indeed, when Delia Bailon-Casilao left Sorsogon
in 1942 after she got married, it was only in 1983 that she returned. Sabina on the other hand, is said to be
living in Zamboanga while Bernabe who left for China in 1931 has not been heard from since then.
Consequently, when Rosalia, from whom the private respondent derived his title, made the disputed sales
covering the entire property, the herein petitioners were unaware thereof.

In the second place, they were not afforded an opportunity to bring suit inasmuch as until 1981, they were kept
in the dark about the transactions entered into by their sister. It was only when Delia Bailon-Casilao returned to
Sorsogon in 1981 that she found out about the sales and immediately, she and her co-petitioners filed the
present action for recovery of property. The appellate court thus erred in holding that 'the petitioners did nothing
to show interest in the land." For the administration of the parcel of land was entrusted to the oldest co-owner
who was then in possession thereof precisely because the other co-owners cannot attend to such a task as
they reside outside of Sorsogon where the land is situated. Her co-owners also allowed her to appropriate the
entire produce for herself because it was not even enough for her daily consumption [TSN, October 5, 1983,
pp. 17-18]. And since petitioner was the one receiving the produce, it is but natural that she was the one to take
charge of paying the real estate taxes. Now, if knowledge of the sale by Rosalia was conveyed to the
petitioners only later, they cannot be faulted for the acts of their co-owner who failed to live up to the trust and
confidence expected of her. In view of the lack of knowledge by the petitioners of the conduct of Rosalia in
selling the land without their consent in 1975 and the absence of any opportunity to institute the proper action
until 1981, laches may not be asserted against the petitioners.
The third element of laches is likewise absent. There was no lack of knowledge or notice on the part of the
defendant that the complainants would assert the right on which they base the suit. On the contrary, private
respondent is guilty of bad faith in purchasing the property as he knew that the property was co-owned by six
persons and yet, there were only two signatories to the deeds of sale and no special authorization to self was
granted to the two sellers by the other co-owners.

Even as the land here was misrepresented in the deeds of sale as "unregistered," the truth was that Afable
already had notice that the land was titled in the name of six persons by virtue of the Certificate of Title which
was already in his possession even before the sale. Such fact is apparent from his testimony before the court a
quo:

COURT:

Q: From whom did you get the certificate of Title?

A: When it was mortgaged by Ponciana Aresgado.

Q: It was mortgaged to you before you bought it?

A: Yes, Your Honor. (TSN, March 5, 1984, p. 12) When cross-examined, he


stated:

Q: Mr. Witness, the original Certificate of Title was given to you in the year
1974, was it not?

A: 1975.

Q: In 1975, you already discovered that the title was in the name of several
persons, is it not?

A: Yes, sir.

Q: When you discovered that it is in the name of several persons, you filed a
case in court for authority to cancel the title to be transferred in your name, is
it not?

A: Yes, sir.

Q: And that was denied by the Court of First Instance of Sorsogon because
there was ordinary one signatory to the deed of sale instead of six, was it
not?

A: Not one but two signatories.

[Decision of the Regional Trial Court of Sorsogon, Rollo, p. 35]

Such actual knowledge of the existence of other co-owners in whose names the lot subject of the sale was
registered should have prompted a searching inquiry by Afable considering the well- known rule in this
jurisdiction that:

... a person dealing with a registered land has a right to rely upon the face of the Torrens
certificate of title and to dispense with the need of inquiring further, except when the party
concerned has actual knowledge of facts and circumstances that would impel a reasonably
cautions man to make such inquiry. [Gonzales v. IAC and Rural Bank of Pavia, Inc., G.R. No.
69622, January 29, 1988).

Moreover, the undisputed fact is that petitioners are relatives of his wife. As a genuine gesture of good faith, he
should have contacted the petitioners who were still listed as co-owners in the certificate of title which was
already in his possession even before the sale. In failing to exercise even a minimum degree of ordinary
prudence required by the situation, he is deemed to have bought the lot at his own risk. Hence any prejudice or
injury that may be occasioned to him by such sale must be borne by him.

Indeed, aware of the flaws impairing his title, Afable went to the herein petitioner Delia Bailon-Casilao, asking
the latter to sign a document obviously to cure the flaw [TSN, July 27, 1983, p.6]. Later, he even filed a petition
in the Court of First Instance to register the title in his name which was denied as aforesaid.

It may be gleaned from the foregoing examination of the facts that Celestino Afable is not a buyer in good faith.
Laches being an equitable defense, he who invokes it must come to the court with clean hands.

WHEREFORE, the petition for certiorari is hereby GRANTED, the challenged decision of the Court of Appeals
is SET ASIDE, and the decision of the trial court is REINSTATED.
G.R. No. 125233 March 9, 2000

Spouses ALEXANDER CRUZ and ADELAIDA CRUZ, petitioners,


vs.
ELEUTERIO LEIS, RAYMUNDO LEIS, ANASTACIO L. LAGDANO, LORETA L. CAYONDA and the
HONORABLE COURT OF APPEALS, respondents.

KAPUNAN, J.:

Private respondents, the heirs of spouses Adriano Leis and Gertrudes Isidro,1 filed an action before the
Regional Trial Court (RTC) of Pasig seeking the nullification of the contracts of sale over a lot executed by
Gertrudes Isidro in favor of petitioner Alexander Cruz, as well as the title subsequently issued in the name of
the latter. Private respondents claimed that the contracts were vitiated by fraud as Gertrudes was illiterate and
already 80 years old at the time of the execution of the contracts; that the price for the land was insufficient as it
was sold only for P39,083.00 when the fair market value of the lot should be P1,000.00 per square meter,
instead of P390.00, more or less; and that the property subject of the sale was conjugal and, consequently, its
sale without the knowledge and consent of private respondents was in derogation of their rights as heirs.

The facts that gave rise to the complaint:

Adriano and Gertrudes were married on 19 April 1923. On 27 April 1955, Gertrudes acquired from the then
Department of Agriculture and Natural Resources (DANR) a parcel of land with an area of one hundred (100)
square meters, situated at Bo. Sto. Niño, Marikina, Rizal and covered by Transfer Certificate of Title (TCT) No.
42245. The Deed of Sale described Gertrudes as a widow. On 2 March 1956, TCT No. 43100 was issued in
the name of "Gertrudes Isidro," who was also referred to therein as a "widow."

On 2 December 1973, Adriano died. It does not appear that he executed a will before his death.

On 5 February 1985, Gertrudes obtained a loan from petitioners, the spouses Alexander and Adelaida Cruz, in
the amount of P15,000.00 at 5% interest, payable on or before 5 February 1986. The loan was secured by a
mortgage over the property covered by TCT No. 43100. Gertrudes, however, failed to pay the loan on the due
date.

Unable to pay her outstanding obligation after the debt became due and payable, on 11 March 1986, Gertrudes
executed two contracts in favor of petitioner Alexander Cruz. The first is denominated as "Kasunduan" which
the parties concede is a pacto de retro sale, granting Gertrudes one year within which to repurchase the
property. The second is a "Kasunduan ng Tuwirang Bilihan," a Deed of Absolute Sale covering the same
property for the price of P39,083.00, the same amount stipulated in the "Kasunduan."

For failure of Gertrudes to repurchase the property, ownership thereof was consolidated in the name of
Alexander Cruz in whose name TCT No. 130584 was issued on 21 April 1987, canceling TCT No. 43100 in the
name of Gertrudes Isidro.

On 9 June 1987, Gertrudes Isidro died. Thereafter, her heirs, herein private respondents, received demands to
vacate the premises from petitioners, the new owners of the property. Private respondents responded by filing
a complaint as mentioned at the outset.

On the basis of the foregoing facts, the RTC rendered a decision in favor of private respondents. The RTC held
that the land was conjugal property since the evidence presented by private respondents disclosed that the
same was acquired during the marriage of the spouses and that Adriano contributed money for the purchase of
the property. Thus, the court concluded, Gertrudes could only sell to petitioner spouses her one-half share in
the property.

The trial court also ruled that no fraud attended the execution of the contracts. Nevertheless, the "Kasunduan,"
providing for a sale con pacto de retro, had superseded the "Kasunduan ng Tuwirang Bilihan" the deed of
absolute sale. The trial court did not consider the pacto de retro sale an equitable mortgage, despite the
allegedly insufficient price. Nonetheless, the trial court found for private respondents. It rationalized that
petitioners failed to comply with the provisions of Article 1607 of the Civil Code requiring a judicial order for the
consolidation of the ownership in the vendee a retro to be recorded in the Registry of Property.

The dispositive portion of the RTC's Decision reads:

WHEREFORE, in the light of all the foregoing, judgment is hereby rendered:

1. Declaring Exhibit G — "Kasunduan ng Tuwirang Bilihan" Null and Void and declar[ing] that
the title issued pursuant thereto is likewise Null and Void;

2. Declaring the property in litigation as conjugal property;

3. Ordering the Registry of Deeds of Marikina Branch to reinstate the title of Gertrudes Isidro;

4. Ordering the plaintiff[s] [sic] to comply with the provision[s] of Article 1607 in relation to
Article 1616 of the Civil Code;

5. Ordering the defendant[s] to pay plaintiff[s] P15,000.00 nominal damages for the violation
of plaintiffs' rights;

6. Ordering the defendant[s] to pay plaintiff[s] the sum of P8,000.00 as and for attorney's fees;

7. Dismissing defendant[s'] counterclaim; and

8. Ordering defendant[s] to pay the cost of suit.

SO ORDERED.2

Petitioners appealed to the Court of Appeals in vain. The Court of Appeals affirmed the decision of the
Regional Trial Court, holding that since the property was acquired during the marriage of Gertrudes to Adriano,
the same was presumed to be conjugal property under Article 160 of the Civil Code. The appellate court, like
the trial court, also noted that petitioner did not comply with the provisions of Article 1607 of the Civil Code.

Petitioners are now before this Court seeking the reversal of the decision of the Court of Appeals. First, they
contend that the subject property is not conjugal but is owned exclusively by Gertrudes, who was described in
the Deed of Sale between Gertrudes and the DANR as well as in TCT No. 43100 as a widow. Second,
assuming the land was conjugal property, petitioners argue that the same became Gertrudes' exclusively
when, in 1979, she mortgaged the property to the Daily Savings Bank and Loan Association. The bank later
foreclosed on the mortgage in 1981 but Gertrudes redeemed the same in 1983.

The paraphernal or conjugal nature of the property is not determinative of the ownership of the disputed
property. If the property was paraphernal as contended by petitioners, Gertrudes Isidro would have the
absolute right to dispose of the same, and absolute title and ownership was vested in petitioners upon the
failure of Gertrudes to redeem the property. On the other hand, if the property was conjugal as private
respondents maintain, upon the death of Adriano Leis, the conjugal partnership was terminate,3 entitling
Gertrudes to one-half of the property.4 Adriano's rights to the other half, in turn, were transmitted upon his death
to his heirs,5 which includes his widow Gertrudes, who is entitled to the same share as that of each of the
legitimate children.6 Thus, as a result of the death of Adriano, a regime of co-ownership arose between
Gertrudes and the other heirs in relation to the property.

Incidentally, there is no merit in petitioners' contention that Gertrudes' redemption of the property from the Daily
Savings Bank vested in ownership over the same to the exclusion of her co-owners. We dismissed the same
argument by one of the petitioners in Paulmitan vs. Court of Appeals,7 where one of the petitioners therein
claimed ownership of the entire property subject of the case by virtue of her redemption thereof after the same
was forfeited in favor of the provincial government for non-payment of taxes. We held however, that the
redemption of the land "did not terminate the co-ownership nor give her title to the entire land subject of the co-
ownership." We expounded, quoting our pronouncement in Adille vs. Court of Appeals:8

The petition raises a purely legal issue: May a co-owner acquire exclusive ownership over the property
held in common?

Essentially, it is the petitioner's contention that the property subject of dispute devolved upon him upon
the failure of his co-heirs to join him in its redemption within the period required by law. He relies on
the provisions of Article 1515 of the old Civil Code, Article 1613 of the present Code, giving the
vendee a retro the right to demand redemption of the entire property.

There is no merit in this petition.

The right of repurchase may be exercised by a co-owner with respect to his share alone (CIVL CODE,
art. 1612; CIVIL CODE (1889), art. 1514.). While the records show that petitioner redeemed the
property in its entirety, shouldering the expenses therefor, that did not make him the owner of all of it.
In other words, it did not put to end the existing state of co-ownership (Supra, Art. 489). There is no
doubt that redemption of property entails a necessary expense. Under the Civil Code:

Art. 488. Each co-owner shall have a right to compel the other co-owners to contribute to the expenses
of preservation of the thing or right owned in common and to the taxes. Any one of the latter may
exempt himself from this obligation by renouncing so much of his undivided interest as may be
equivalent to his share of the expenses and taxes. No such waiver shall be made if it is prejudicial to
the co-ownership.

The result is that the property remains to be in a condition of co-ownership. While a vendee a retro,
under Article 1613 of the Code, "may not be compelled to consent to a partial redemption," the
redemption by one co-heir or co-owner of the property in its totality does not vest in him ownership
over it. Failure on the part of all the co-owners to redeem it entitles the vendee a retro to retain the
property and consolidate title thereto in his name (Supra, art. 1607). But the provision does not give to
the redeeming co-owner the right to the entire property. It does not provide for a mode of terminating a
co-ownership.

It is conceded that, as a rule, a co-owner such as Gertrudes could only dispose of her share in the property
owned in common. Article 493 of the Civil Code provides:

Art. 493. Each co-owner shall have the full ownership of his part of the fruits and benefits pertaining
thereto, and he may therefore alienate, assign or mortgage it, and even substitute another person in its
enjoyment, except when personal rights are involved. But the effect of the alienation or the mortgage,
with respect to the co-owners, shall be limited to the portion which may be allotted to him in the
division upon the termination of the co-ownership.

Unfortunately for private respondents, however, the property was registered in TCT No. 43100 solely in the
name of "Gertrudes Isidro, widow." Where a parcel of land, forming past of the undistributed properties of the
dissolved conjugal partnership of gains, is sold by a widow to a purchaser who merely relied on the face of the
certificate of title thereto, issued solely in the name of the widow, the purchaser acquires a valid title to the land
even as against the heirs of the deceased spouse. The rationale for this rule is that "a person dealing with
registered land is not required to go behind the register to determine the condition of the property. He is only
charged with notice of the burdens on the property which are noted on the face of the register or the certificate
of title. To require him to do more is to defeat one of the primary objects of the Torrens system." 9

As gleaned from the foregoing discussion, despite the Court of Appeals' finding and conclusion that Gertrudes
as well as private respondents failed to repurchase the property within the period stipulated and has lost all
their rights to it, it still ruled against petitioners by affirming the Regional Trial Court's decision on the premise
that there was no compliance with Article 1607 of the Civil Code requiring a judicial hearing before registration
of the property in the name of petitioners. This provision states:

Art. 1607. In case of real property, the consolidation of ownership in the vendee by virtue of the failure
of the vendor to comply with the provisions of article 1616 shall not be recorded in the Registry of
Property without a judicial order, after the vendor has been duly heard.

The aforequoted article is intended to minimize the evils which the pacto de retro sale has caused in the hands
of usurers. A judicial order is necessary in order to determine the true nature of the transaction and to prevent
1âwphi1

the interposition of buyers in good faith while the determination is being made. 10

It bears stressing that notwithstanding Article 1607, the recording in the Registry of Property of the
consolidation of ownership of the vendee is not a condition sine qua non to the transfer of ownership.
Petitioners are the owners of the subject property since neither Gertrudes nor her co-owners redeemed the
same within the one-year period stipulated in the "Kasunduan." The essence of a pacto de retro sale is that title
and ownership of the property sold are immediately vested in the vendee a retro, subject to the resolutory
condition of repurchase by the vendor a retro within the stipulated period. Failure thus of the vendor a retro to
perform said resolutory condition vests upon the vendee by operation of law absolute title and ownership over
the property sold. As title is already vested in the vendee a retro, his failure to consolidate his title under Article
1607 of the Civil Code does not impair such title or ownership for the method prescribed thereunder is merely
for the purpose of registering the consolidated title. 11

WHEREFORE, the decision of the Court of Appeals is MODIFIED in that the petitioners are deemed owners of
the property by reason of the failure of the vendor, Gertrudes Isidro, to repurchase the same within the period
stipulated. However, Transfer Certificate of Title No. 130584, in the name of Alexander M. Cruz, which was
issued without judicial order, is hereby ordered CANCELLED, and Transfer Certificate of Title No. 43100 in the
name of Gertrudes Isidro is ordered REINSTATED, without prejudice to compliance by petitioners with the
provisions of Article 1607 of the Civil Code. 1âw phi 1.nêt
G.R. No. 108228 February 1, 2001

SPOUSES MANUEL and SALVACION DEL CAMPO, petitioners,


vs.
HON. COURT OF APPEALS and HEIRS OF JOSE REGALADO, SR., respondents.

QUISUMBING, J.:

This is a petition for review on certiorari of a decision of the Court of Appeals which affirmed the judgment of
the Regional Trial Court of Roxas City, Branch 15 in Civil Case No. V-5369, ordering the dismissal of the action
for repartition, resurvey and reconveyance filed by petitioners.

Pure questions of law are raised in this appeal as the following factual antecedents are undisputed:

Salome, Consorcia, Alfredo, Maria, Rosalia, Jose, Quirico and Julita, all surnamed Bornales, were the original
co-owners of Lot 162 of the Cadastral Survey of Pontevedra, Capiz under Original Certificate of Title No.
18047. As appearing therein, the lot, which consisted of a total area of 27,179 square meters was divided in
aliquot shares among the eight (8) co-owners as follows:

Salome Bornales 4/16

Consorcia 4/16
Bornales

Alfredo Bornales 2/16

Maria Bornales 2/16

Jose Bornales 1/16

Quirico Bornales 1/16

Rosalia Bornales 1/16

Julita Bornales 1/16

On July 14, 1940, Salome sold part of her 4/16 share in Lot 162 for P200.00 to Soledad Daynolo. In the Deed
of Absolute Sale signed by Salome and two other co-owners, Consorcia and Alfredo, the portion of Lot 162
sold to Soledad was described as having more or less the following measurements:

63-1/2 meters from point "9" to "10", 35 meters from point "10" to point "11", 30 meters from point "11"
to a certain point parallel to a line drawn from points "9" to "10"; and then from this "Certain Point" to
point "9" and as shown in the accompanying sketch, and made an integral part of this deed, to
SOLEDAD DAYNOLO, her heirs and assigns.1

Thereafter, Soledad Daynolo immediately took possession of the land described above and built a house
thereon. A few years later, Soledad and her husband, Simplicio Distajo, mortgaged the subject portion of Lot
162 as security for a P400.00 debt to Jose Regalado, Sr. This transaction was evidenced by a Deed of
Mortgage2 dated May 1, 1947.

On April 14, 1948, three of the eight co-owners of Lot 162, specifically, Salome, Consorcia and Alfredo, sold
24,993 square meters of said lot to Jose Regalado, Sr.

On May 4, 1951, Simplicio Distajo, heir of Soledad Daynolo who had since died, paid the mortgage debt and
redeemed the mortgaged portion of Lot 162 from Jose Regalado, Sr. The latter, in turn, executed a Deed of
Discharge of Mortgage3 in favor of Soledad’s heirs, namely: Simplicio Distajo, Rafael Distajo and Teresita
Distajo-Regalado. On same date, the said heirs sold the redeemed portion of Lot 162 for P1,500.00 to herein
petitioners, the spouses Manuel Del Campo and Salvacion Quiachon. 1âw phi1.nêt

Meanwhile, Jose Regalado, Sr. caused the reconstitution of Original Certificate of Title No. 18047. The
reconstituted OCT No. RO-4541 initially reflected the shares of the original co-owners in Lot 162. However, title
was transferred later to Jose Regalado, Sr. who subdivided the entire property into smaller lots, each covered
by a respective title in his name. One of these small lots is Lot No. 162-C-6 with an area of 11,732 square
meters which was registered on February 24, 1977 under TCT No. 14566.

In 1987, petitioners Manuel and Salvacion del Campo brought this complaint for "repartition, resurvey and
reconveyance" against the heirs of the now deceased Jose Regalado, Sr. Petitioners claimed that they owned
an area of 1,544 square meters located within Lot 162-C-6 which was erroneously included in TCT No. 14566
in the name of Regalado. Petitioners alleged that they occupied the disputed area as residential dwelling ever
since they purchased the property from the Distajos way back in 1951. They also declared the land for taxation
purposes and paid the corresponding taxes.

On April 1, 1987, summons were served on Regalado’s widow, Josefina Buenvenida, and two of her children,
Rosemarie and Antonio. Josefina and Rosemarie were declared in default on May 10, 1989 because only
Antonio filed an answer to the complaint.

During trial, petitioners presented the Deed of Absolute Sale4 executed between Soledad Daynolo and Salome
Bornales as well as the Deed of Mortgage5 and Deed of Discharge6 signed by Jose Regalado, Sr. The Deed of
Absolute Sale7 showing the purchase by the Del Campos of the property from the Distajos was likewise given
in evidence.

Despite the filing of an answer, Antonio failed to present any evidence to refute the claim of petitioners. Thus,
after considering Antonio to have waived his opportunity to present evidence, the trial court deemed the case
submitted for decision.

On November 20, 1990, the trial court rendered judgment dismissing the complaint. It held that while Salome
could alienate her pro-indiviso share in Lot 162, she could not validly sell an undivided part thereof by meters
and bounds to Soledad, from whom petitioners derived their title. The trial court also reasoned that petitioners
could not have a better right to the property even if they were in physical possession of the same and declared
the property for taxation purposes, because mere possession cannot defeat the right of the Regalados who had
a Torrens title over the land.

On appeal, the Court of Appeals affirmed the trial court’s judgment, with no pronouncement as to costs. 8

Petitioners now seek relief from this Court and maintain that:

I.

THE FACT THAT THE SALE OF THE SUBJECT PORTION CONSTITUTES A SALE OF A
CONCRETE OR DEFINITE PORTION OF LAND OWNED IN COMMON DOES NOT ABSOLUTELY
DEPRIVE HEREIN PETITIONERS OF ANY RIGHT OR TITLE THERETO;

II.

IN ANY EVENT, HEREIN PRIVATE RESPONDENTS ARE ALL ESTOPPED FROM DENYING THE
RIGHT AND TITLE OF HEREIN PETITIONERS.9

In resolving petitioners’ appeal, we must answer the following questions: Would the sale by a co-owner of a
physical portion of an undivided property held in common be valid? Is respondent estopped from denying
petitioners’ right and title over the disputed area? Under the facts and circumstances duly established by the
evidence, are petitioners entitled to ‘repartition, resurvey and reconveyance’ of the property in question?
On the first issue, it seems plain to us that the trial court concluded that petitioners could not have acquired
ownership of the subject land which originally formed part of Lot 162, on the ground that their alleged right
springs from a void sale transaction between Salome and Soledad. The mere fact that Salome purportedly
transferred a definite portion of the co-owned lot by metes and bounds to Soledad, however, does not per
se render the sale a nullity. This much is evident under Article 49310 of the Civil Code and pertinent
jurisprudence on the matter. More particularly in Lopez vs. Vda. De Cuaycong, et. al.11 which we find relevant,
the Court, speaking through Mr. Justice Bocobo, held that:

…The fact that the agreement in question purported to sell a concrete portion of the hacienda does not
render the sale void, for it is a well-established principle that the binding force of a contract must be
recognized as far as it is legally possible to do so. "Quando res non valet ut ago, valeat quantum
valere potest." (When a thing is of no force as I do it, it shall have as much force as it can have.) 12

Applying this principle to the instant case, there can be no doubt that the transaction entered into by Salome
and Soledad could be legally recognized in its entirety since the object of the sale did not even exceed the ideal
shares held by the former in the co-ownership. As a matter of fact, the deed of sale executed between the
parties expressly stipulated that the portion of Lot 162 sold to Soledad would be taken from Salome’s 4/16
undivided interest in said lot, which the latter could validly transfer in whole or in part even without the consent
of the other co-owners. Salome’s right to sell part of her undivided interest in the co-owned property is absolute
in accordance with the well-settled doctrine that a co-owner has full ownership of his pro-indiviso share and has
the right to alienate, assign or mortgage it, and substitute another person in its enjoyment13 Since Salome’s
clear intention was to sell merely part of her aliquot share in Lot 162, in our view no valid objection can be
made against it and the sale can be given effect to the full extent.

We are not unaware of the principle that a co-owner cannot rightfully dispose of a particular portion of a co-
owned property prior to partition among all the co-owners. However, this should not signify that the vendee
does not acquire anything at all in case a physically segregated area of the co-owned lot is in fact sold to him.
Since the co-owner/vendor’s undivided interest could properly be the object of the contract of sale between the
parties, what the vendee obtains by virtue of such a sale are the same rights as the vendor had as co-owner, in
an ideal share equivalent to the consideration given under their transaction. In other words, the vendee steps
into the shoes of the vendor as co-owner and acquires a proportionate abstract share in the property held in
common.

Resultantly, Soledad became a co-owner of Lot 162 as of the year 1940 when the sale was made in her favor.
It follows that Salome, Consorcia and Alfredo could not have sold the entire Lot 162 to Jose Regalado, Sr. on
April 14, 1948 because at that time, the ideal shares held by the three co-owners/vendors were equivalent to
only 10/16 of the undivided property less the aliquot share previously sold by Salome to Soledad. Based on the
principle that "no one can give what he does not have,"14 Salome, Consorcia and Alfredo could not legally sell
the shares pertaining to Soledad since a co-owner cannot alienate more than his share in the co-ownership.
We have ruled many times that even if a co-owner sells the whole property as his, the sale will affect only his
own share but not those of the other co-owners who did not consent to the sale. Since a co-owner is entitled to
sell his undivided share, a sale of the entire property by one co-owner will only transfer the rights of said co-
owner to the buyer, thereby making the buyer a co-owner of the property.15

In this case, Regalado merely became a new co-owner of Lot 162 to the extent of the shares which Salome,
Consorcia and Alfredo could validly convey. Soledad retained her rights as co-owner and could validly transfer
her share to petitioners in 1951. The logical effect on the second disposition is to substitute petitioners in the
rights of Soledad as co-owner of the land. Needless to say, these rights are preserved notwithstanding the
issuance of TCT No. 14566 in Regalado’s name in 1977.

Be that as it may, we find that the area subject matter of this petition had already been effectively segregated
from the ‘mother lot’ even before title was issued in favor of Regalado. It must be noted that 26 years had
lapsed from the time petitioners bought and took possession of the property in 1951 until Regalado procured
the issuance of TCT No. 14566. Additionally, the intervening years between the date of petitioners’ purchase of
the property and 1987 when petitioners filed the instant complaint, comprise all of 36 years. However, at no
instance during this time did respondents or Regalado, for that matter, question petitioners’ right over the land
in dispute. In the case of Vda. De Cabrera vs. Court of Appeals,16 we had occasion to hold that where the
transferees of an undivided portion of the land allowed a co-owner of the property to occupy a definite portion
thereof and had not disturbed the same for a period too long to be ignored, the possessor is in a better
condition or right than said transferees. (Potior est condition possidentis). Such undisturbed possession had the
effect of a partial partition of the co-owner property which entitles the possessor to the definite portion which he
occupies. Conformably, petitioners are entitled to the disputed land, having enjoyed uninterrupted possession
thereof for a total of 49 years up to the present.

The lower court’s reliance on the doctrine that mere possession cannot defeat the right of a holder of a
registered Torrens title over property is misplaced, considering that petitioners were deprived of their dominical
rights over the said lot through fraud and with evident bad faith on the part of Regalado. Failure and intentional
omission to disclose the fact of actual physical possession by another person during registration proceedings
constitutes actual fraud. Likewise, it is fraud to knowingly omit or conceal a fact, upon which benefit is obtained
to the prejudice of a third person.17 In this case, we are convinced that Regalado knew of the fact that he did
not have a title to the entire lot and could not, therefore, have validly registered the same in his name alone
because he was aware of petitioners’ possession of the subject portion as well as the sale between Salome
and Soledad.

That Regalado had notice of the fact that the disputed portion of Lot 162 was under claim of ownership by
petitioners and the latter’s predecessor is beyond question. Records show that the particular area subject of
this case was mortgaged by Soledad and her husband to Jose Regalado, Sr. as early as May 1, 1947 or one
year prior to the alienation of the whole lot in favor of the latter. Regalado never questioned the ownership of
the lot given by Soledad as security for the P400.00 debt and he must have at least known that Soledad bought
the subject portion from Salome since he could not have reasonably accepted the lot as security for the
mortgage debt if such were not the case. By accepting the said portion of Lot 162 as security for the mortgage
obligation, Regalado had in fact recognized Soledad’s ownership of this definite portion of Lot 162. Regalado
could not have been ignorant of the fact that the disputed portion is being claimed by Soledad and
subsequently, by petitioners, since Regalado even executed a Release of Mortgage on May 4, 1951, three
years after the entire property was supposedly sold to him. It would certainly be illogical for any mortgagee to
accept property as security, purchase the mortgaged property and, thereafter, claim the very same property as
his own while the mortgage was still subsisting.

Consequently, respondents are estopped from asserting that they own the subject land in view of the Deed of
Mortgage and Discharge of Mortgage executed between Regalado and petitioners’ predecessor-in-interest. As
petitioners correctly contend, respondents are barred from making this assertion under the equitable principle
of estoppel by deed, whereby a party to a deed and his privies are precluded from asserting as against the
other and his privies any right or title in derogation of the deed, or from denying the truth of any material fact
asserted in it.18 A perusal of the documents evidencing the mortgage would readily reveal that Soledad, as
mortgagor, had declared herself absolute owner of the piece of land now being litigated. This declaration of fact
was accepted by Regalado as mortgagee and accordingly, his heirs cannot now be permitted to deny it.

Although Regalado’s certificate of title became indefeasible after the lapse of one year from the date of the
decree of registration, the attendance of fraud in its issuance created an implied trust in favor of petitioners and
gave them the right to seek reconveyance of the parcel wrongfully obtained by the former. An action for
reconveyance based on an implied trust ordinarily prescribes in ten years. But when the right of the true and
real owner is recognized, expressly or implicitly such as when he remains undisturbed in his possession, the
said action is imprescriptible, it being in the nature of a suit for quieting of title. 19 Having established by clear
and convincing evidence that they are the legal owners of the litigated portion included in TCT NO. 14566, it is
only proper that reconveyance of the property be ordered in favor of petitioners. The alleged incontrovertibility
of Regalado’s title cannot be successfully invoked by respondents because certificates of title merely confirm or
record title already existing and cannot be used to protect a usurper from the true owner or be used as a shield
for the commission of fraud.20

WHEREFORE, the petition is GRANTED. The assailed decision of the Court of Appeals in CA-G.R. CV No.
30438 is REVERSED and SET ASIDE. The parties are directed to cause a SURVEY for exact determination of
their respective portions in Lot 162-C-6. Transfer Certificate of Title No. 14566 is declared CANCELLED and
the Register of Deeds of Capiz is ordered to ISSUE a new title in accordance with said survey, upon finality of
this decision.
G.R. No. 152766 June 20, 2003

LILIA SANCHEZ, Petitioner,


vs.
COURT OF APPEALS, HON. VICTORINO S. ALVARO as Presiding Judge, RTC-Br. 120, Caloocan City,
and VIRGINIA TERIA, Respondents.

DECISION

BELLOSILLO, J.:

This is a Special Civil Action for Certiorari under Rule 65 of the Rules of Court to annul and set aside the
Decision of the Court of Appeals dated 23 May 2001 as well as its Resolution dated 8 January 2002 in CA-G.R.
SP No. 59182.

Lilia Sanchez, petitioner, constructed a house on a 76-square meter lot owned by her parents-in-law. The lot
was registered under TCT No. 263624 with the following co-owners: Eliseo Sanchez married to Celia Sanchez,
Marilyn Sanchez married to Nicanor Montalban, Lilian Sanchez, widow, Nenita Sanchez, single, Susana
Sanchez married to Fernando Ramos, and Felipe Sanchez.1 On 20 February 1995, the lot was registered under
TCT No. 289216 in the name of private respondent Virginia Teria by virtue of a Deed of Absolute Sale
supposed to have been executed on 23 June 19952 by all six (6) co-owners in her favor.3 Petitioner claimed that
she did not affix her signature on the document and subsequently refused to vacate the lot, thus prompting
private respondent Virginia Teria to file an action for recovery of possession of the aforesaid lot with the
Metropolitan Trial Court (MeTC) of Caloocan City sometime in September 1995, subsequently raffled to Br. 49
of that court.

On 12 February 1998, the MeTC-Br. 49 of Caloocan City ruled in favor of private respondent declaring that the
sale was valid only to the extent of 5/6 of the lot and the other 1/6 remaining as the property of petitioner, on
account of her signature in the Deed of Absolute Sale having been established as a forgery.

Petitioner then elevated her appeal to the Regional Trial Court of Caloocan City, subsequently assigned to Br.
120, which ordered the parties to file their respective memoranda of appeal. Counsel for petitioner did not
comply with this order, nor even inform her of the developments in her case. Petitioner not having filed any
pleading with the RTC of Caloocan City, the trial court affirmed the 27 July 1998 decision of the MeTC.

On 4 November 1998, the MeTC issued an order for the issuance of a writ of execution in favor of private
respondent Virginia Teria, buyer of the property. On 4 November 1999 or a year later, a Notice to Vacate was
served by the sheriff upon petitioner who however refused to heed the Notice.

On 28 April 1999 private respondent started demolishing petitioner’s house without any special permit of
demolition from the court.

Due to the demolition of her house which continued until 24 May 1999 petitioner was forced to inhabit the
portion of the premises that used to serve as the house’s toilet and laundry area.

On 29 October 1999 petitioner filed her Petition for Relief from Judgment with the RTC on the ground that she
was not bound by the inaction of her counsel who failed to submit petitioner’s appeal memorandum. However
the RTC denied the Petition and the subsequent Motion for Reconsideration.

On 14 June 2000 petitioner filed her Petition for Certiorari with the Court of Appeals alleging grave abuse of
discretion on the part of the court a quo.

On 23 May 2001 the appellate court dismissed the petition for lack of merit. On 18 June 2001 petitioner filed a
1âw phi1

Motion for Reconsideration but the Court of Appeals denied the motion in its Resolution of 8 January 2002.
The only issue in this case is whether the Court of Appeals committed grave abuse of discretion in dismissing
the challenged case before it.

As a matter of policy, the original jurisdiction of this Court to issue the so-called extraordinary writs should
generally be exercised relative to actions or proceedings before the Court of Appeals or before constitutional or
other tribunals or agencies the acts of which for some reason or other are not controllable by the Court of
Appeals. Where the issuance of the extraordinary writ is also within the competence of the Court of Appeals or
the Regional Trial Court, it is either of these courts that the specific action for the procurement of the writ must
be presented. However, this Court must be convinced thoroughly that two (2) grounds exist before it gives due
course to a certiorari petition under Rule 65: (a) The tribunal, board or officer exercising judicial or quasi-judicial
functions has acted without or in excess of its or his jurisdiction; and (b) There is no appeal nor any plain,
speedy and adequate remedy in the ordinary course of law.

Despite the procedural lapses present in this case, we are giving due course to this petition as there are
matters that require immediate resolution on the merits to effect substantial justice.

The Rules of Court should be liberally construed in order to promote their object of securing a just, speedy and
inexpensive disposition of every action or proceeding.4

The rules of procedure should be viewed as mere tools designed to aid the courts in the speedy, just and
inexpensive determination of the cases before them. Liberal construction of the rules and the pleadings is the
controlling principle to effect substantial justice.5 Litigations should, as much as possible, be decided on their
merits and not on mere technicalities.6

Verily, the negligence of petitioner’s counsel cannot be deemed as negligence of petitioner herself in the case
at bar. A notice to a lawyer who appears to have been unconscionably irresponsible cannot be considered as
notice to his client.7 Under the peculiar circumstances of this case, it appears from the records that counsel was
negligent in not adequately protecting his client’s interest, which necessarily calls for a liberal construction of
the Rules.

The rationale for this approach is explained in Ginete v. Court of Appeals - 8

This Court may suspend its own rules or exempt a particular case from its operation where the appellate court
failed to obtain jurisdiction over the case owing to appellant’s failure to perfect an appeal. Hence, with more
reason would this Court suspend its own rules in cases where the appellate court has already obtained
jurisdiction over the appealed case. This prerogative to relax procedural rules of the most mandatory character
in terms of compliance, such as the period to appeal has been invoked and granted in a considerable number
of cases x x x x

Let it be emphasized that the rules of procedure should be viewed as mere tools designed to facilitate the
attainment of justice. Their strict and rigid application, which would result in technicalities that tend to frustrate
rather than promote substantial justice, must always be eschewed. Even the Rules of Court reflect this
principle. The power to suspend or even disregard rules can be so pervasive and compelling as to alter even
that which this Court itself has already declared to be final, as we are now constrained to do in the instant case
xxxx

The emerging trend in the rulings of this Court is to afford every party litigant the amplest opportunity for the
proper and just determination of his cause, free from the constraints of technicalities. Time and again, this
Court has consistently held that rules must not be applied rigidly so as not to override substantial justice.

Aside from matters of life, liberty, honor or property which would warrant the suspension of the Rules of the
most mandatory character and an examination and review by the appellate court of the lower court’s findings of
fact, the other elements that should be considered are the following: (a) the existence of special or compelling
circumstances, (b) the merits of the case, (c) a cause not entirely attributable to the fault or negligence of the
party favored by the suspension of the rules, (d) a lack of any showing that the review sought is merely
frivolous and dilatory, and (e) the other party will not be unjustly prejudiced thereby.9
The suspension of the Rules is warranted in this case since the procedural infirmity was not entirely attributable
to the fault or negligence of petitioner. Besides, substantial justice requires that we go into the merits of the
case to resolve the present controversy that was brought about by the absence of any partition agreement
among the parties who were co-owners of the subject lot in question. Hence, giving due course to the instant
petition shall put an end to the dispute on the property held in common.

In People’s Homesite and Housing Corporation v. Tiongco10 we held:

There should be no dispute regarding the doctrine that normally notice to counsel is notice to parties, and that
such doctrine has beneficent effects upon the prompt dispensation of justice. Its application to a given case,
however, should be looked into and adopted, according to the surrounding circumstances; otherwise, in the
court’s desire to make a short-cut of the proceedings, it might foster, wittingly or unwittingly, dangerous
collusions to the detriment of justice. It would then be easy for one lawyer to sell one’s rights down the river, by
just alleging that he just forgot every process of the court affecting his clients, because he was so busy. Under
this circumstance, one should not insist that a notice to such irresponsible lawyer is also a notice to his clients.

Thus, we now look into the merits of the petition.

This case overlooks a basic yet significant principle of civil law: co-ownership. Throughout the proceedings
from the MeTC to the Court of Appeals, the notion of co-ownership11 was not sufficiently dealt with. We attempt
to address this controversy in the interest of substantial justice. Certiorari should therefore be granted to cure
this grave abuse of discretion.

Sanchez Roman defines co-ownership as "the right of common dominion which two or more persons have in a
spiritual part of a thing, not materially or physically divided.12 Manresa defines it as the "manifestation of the
private right of ownership, which instead of being exercised by the owner in an exclusive manner over the
things subject to it, is exercised by two or more owners and the undivided thing or right to which it refers is one
and the same."13

The characteristics of co-ownership are: (a) plurality of subjects, who are the co-owners, (b) unity of or material
indivision, which means that there is a single object which is not materially divided, and which is the element
which binds the subjects, and, (c) the recognition of ideal shares, which determines the rights and obligations of
the co-owners.14

In co-ownership, the relationship of such co-owner to the other co-owners is fiduciary in character and attribute.
Whether established by law or by agreement of the co-owners, the property or thing held pro-indiviso is
impressed with a fiducial nature so that each co-owner becomes a trustee for the benefit of his co-owners and
he may not do any act prejudicial to the interest of his co-owners.15

Thus, the legal effect of an agreement to preserve the properties in co-ownership is to create an express trust
among the heirs as co-owners of the properties. Co-ownership is a form of trust and every co-owner is a
trustee for the others.16

Before the partition of a land or thing held in common, no individual or co-owner can claim title to any definite
portion thereof. All that the co-owner has is an ideal or abstract quota or proportionate share in the entire land
or thing.17

Article 493 of the Civil Code gives the owner of an undivided interest in the property the right to freely sell and
dispose of it, i.e., his undivided interest. He may validly lease his undivided interest to a third party
independently of the other co-owners.18 But he has no right to sell or alienate a concrete, specific or determinate
part of the thing owned in common because his right over the thing is represented by a quota or ideal portion
without any physical adjudication.19

Although assigned an aliquot but abstract part of the property, the metes and bounds of petitioner’s lot has not
been designated. As she was not a party to the Deed of Absolute Sale voluntarily entered into by the other co-
owners, her right to 1/6 of the property must be respected. Partition needs to be effected to protect her right to
her definite share and determine the boundaries of her property. Such partition must be done without prejudice
to the rights of private respondent Virginia Teria as buyer of the 5/6 portion of the lot under dispute.

WHEREFORE, the Petition is GRANTED. The Decision of the Court of Appeals dated 23 May 2001 as well as
its Resolution dated 8 January 2002 in CA-G.R. SP No. 59182 is ANNULLED and SET ASIDE. A survey of the
questioned lot with TCT No. 289216 (formerly TCT No. 263624) by a duly licensed geodetic engineer and the
PARTITION of the aforesaid lot are ORDERED.

Let the records of this case be REMANDED to MeTC-Br. 49, Caloocan City to effect the aforementioned survey
and partition, as well as segregate the 1/6 portion appertaining to petitioner Lilia Sanchez.

The Deed of Absolute Sale by the other co-owners to Virginia Teria shall be RESPECTED insofar as the other
undivided 5/6 portion of the property is concerned.
G.R. No. 152168 December 10, 2004

HEIRS OF THE LATE SPOUSES AURELIO AND ESPERANZA BALITE; Namely, ANTONIO T. BALITE,
FLOR T. BALITE-ZAMAR, VISITACION T. BALITE-DIFUNTORUM, PEDRO T. BALITE, PABLO T. BALITE,
GASPAR T. BALITE, CRISTETA T. BALITE and AURELIO T. BALITE JR., All Represented by GASPAR T.
BALITE,petitioners,
vs.
RODRIGO N. LIM, respondent.

DECISION

PANGANIBAN, J.:

A deed of sale that allegedly states a price lower than the true consideration is nonetheless binding between
the parties and their successors in interest. Furthermore, a deed of sale in which the parties clearly intended to
transfer ownership of the property cannot be presumed to be an equitable mortgage under Article 1602 of the
Civil Code. Finally, an agreement that purports to sell in metes and bounds a specific portion of an
unpartitioned co-owned property is not void; it shall effectively transfer the seller’s ideal share in the co-
ownership.

The Case

Before us is a Petition for Review1 under Rule 45 of the Rules of Court, assailing the February 11, 2002
Decision2 of the Court of Appeals (CA) in CA-GR CV No. 65395. The decretal portion of the Decision reads as
follows:

"IN THE LIGHT OF ALL THE FOREGOING, the Decision of the Court a quo subject of the appeal is
hereby SET ASIDE AND REVERSED and another Decision is hereby rendered as follows:

1. The "Deed of Absolute Sale" (Exhibit "A") is valid only insofar as the pro indiviso share of
Esperanza Balite over the property covered by Original Certificate of Title No. 10824 is concerned;

2. The Register of Deeds is hereby ordered to cancel Transfer Certificate of Title No. 6683 and to
issue another over the entirety of the property covered by Original Certificate of Title No. 10824, upon
the payment of the capital gains tax due, as provided for by law, (based on the purchase price of the
property in the amount of P1,000,000.00), with the following as co-owners, over the property described
therein:

a) Each of the [petitioners] over an undivided portion of 975 square meters;

b) The [respondent], with an undivided portion of 9,751 square meters.

3. The [respondent] is hereby ordered to pay to the [petitioners] the amount of P120,000.00, within a
period of five (5) months from the finality of the Decision of this Court;

4. In the event that the [respondent] refuses or fails to remit the said amount to the [petitioner] within
the period therefor, the rights and obligations of the parties shall be governed by Republic 6552
(Maceda Law)."3
The Facts

The CA summarized the facts in this manner:

"The spouses Aurelio x x x and Esperanza Balite were the owners of a parcel of land, located [at]
Poblacion (Barangay Molave), Catarman, Northern Samar, with an area of seventeen thousand five
hundred fifty-one (17,551) square meters, [and] covered by Original Certificate of Title [OCT] No.
10824. When Aurelio died intestate [in 1985, his wife], Esperanza Balite, and their children, x x x
[petitioners] Antonio Balite, Flor Balite-Zamar, Visitacion Balite-Difuntorum, Pedro Balite, Pablo Balite,
Gaspar Balite, Cristeta (Tita) Balite and Aurelio Balite, Jr., inherited the [subject] property and became
co-owners thereof, with Esperanza x x x inheriting an undivided [share] of [9,751] square meters.

"In the meantime, Esperanza x x x [became] ill and was in dire need of money for her hospital
expenses x x x. She, through her daughter, Cristeta, offered to sell to Rodrigo Lim, [her] undivided
share x x x for the price of P1,000,000.00. x x x Esperanza x x x and Rodrigo x x x agreed that, under
the "Deed of Absolute Sale", to be executed by Esperanza x x x over the property, it will be made to
appear that the purchase price of the property would be P150,000.00, although the actual price agreed
upon by them for the property was P1,000,000.00.

"On April 16, 1996, Esperanza x x x executed a "Deed of Absolute Sale" in favor of Rodrigo N. Lim
over a portion of the property, covered by [OCT] No. 10824, with an area of 10,000 square meters, for
the price of P150,000.00 x x x.

[They] also executed, on the same day, a "Joint Affidavit" under which they declared that the real price
of the property was P1,000,000.00, payable to Esperanza x x x, by installments, as follows:

1. P30,000.00 – upon signing today of the document of sale.

2. P170,000.00 – payable upon completion of the actual relocation survey of the land sold by
a Geodetic Engineer.

3. P200,000.00 – payable on or before May 15, 1996.

4. P200,000.00 – payable on or before July 15, 1996.

5. P200,000.00 – payable on or before September 15, 1996.

6. P200,000.00 – payable on or before December 15, 1996.

"Only Esperanza and two of her children, namely, Antonio x x x and Cristeta x x x, knew about the said
transaction. x x x Geodetic Engineer Bonifacio G. Tasic conducted a subdivision survey of the property
and prepared a "Sketch Plan" showing a portion of the property, identified as Lot 243 with an area of
10,000 square meters, under the name Rodrigo N. Lim.

"The "Sketch Plan" was signed by Rodrigo x x x and Esperanza. Thereafter, Rodrigo x x x took actual
possession of the property and introduced improvements thereon. He remitted to Esperanza x x x and
Cristeta x x x sums of money in partial payments of the x x x property for which he signed "Receipts".

"Gaspar, Visitacion, Flor, Pedro and Aurelio, Jr. x x x learned of the sale, and on August 21, 1996, they
wrote a letter to the Register of Deeds [RD] of Northern Samar, [saying] that they [were] not x x x
informed of the sale of a portion of the said property by their mother x x x nor did they give their
consent thereto, and requested the [RD] to:
"x x x hold in abeyance any processal or approval of any application for registration of title of
ownership in the name of the buyer of said lot, which has not yet been partitioned judicially or
extrajudicially, until the issue of the legality/validity of the above sale has been cleared."

"On August 24, 1996, Antonio x x x received from Rodrigo x x x, the amount of P30,000.00 in partial
payment of [the] property and signed a "Receipt" for the said amount, declaring therein that "the
remaining balance of P350,000.00 shall personally and directly be released to my mother, Esperanza
Balite, only." However, Rodrigo x x x drew and issued RCBC Check No. 309171, dated August 26,
1996, [payable] to the order of Antonio Balite in the amount of P30,000.00 in partial payment of the
property.

"On October 1, 1996, Esperanza x x x executed a "Special Power of Attorney" appointing her son,
Antonio, to collect and receive, from Rodrigo, the balance of the purchase price of the x x x property
and to sign the appropriate documents therefor.

"On October 23, 1996, Esperanza signed a letter addressed to Rodrigo informing the latter that her
children did not agree to the sale of the property to him and that she was withdrawing all her
commitments until the validity of the sale is finally resolved:

xxx xxx xxx

"On October 31, 1996, Esperanza died intestate and was survived by her aforenamed children.

"[Meanwhile], Rodrigo caused to be published, in the Samar Reporter, on November 14, 21 and 28,
1996, the aforesaid "Deed of Absolute Sale". Earlier, on November 21, 1996, Antonio received the
amount of P10,000.00 from Rodrigo for the payment of the estate tax due from the estate of
Esperanza.

"Also, the capital gains tax, in the amount of P14,506.25, based on the purchase price of P150,000.00
appearing on the "Deed of Absolute Sale", was paid to the Bureau of Internal Revenue which issued a
"Certification" of said payments, on March 5, 1997, authorizing the registration of the "Deed of
Absolute Sale" x x x. However, the [RD] refused to issue a title over the property to and under the
name of Rodrigo unless and until the owner’s duplicate of OCT No. 10824 was presented to [it].
Rodrigo filed a "Petition for Mandamus" against the RD with the Regional Trial Court of Northern
Samar (Rodrigo Lim versus Fernando Abella, Special Civil Case No. 48). x x x. On June 13, 1997,
the court issued an Order to the RD to cancel OCT No. 10824 and to issue a certificate of title over Lot
243 under the name of Rodrigo.

"On June 27, 1997, [petitioners] filed a complaint against Rodrigo with the Regional Trial Court of
Northern Samar, entitled and docketed as "Heirs of the Spouses Aurelio Balite, et al. versus
Rodrigo Lim, Civil Case No. 920, for "Annulment of Sale, Quieting of Title, Injunction and
Damages x x x, [the origin of the instant case.]

xxx xxx xxx

"The [petitioners] had a "Notice of Lis Pendens", dated June 23, 1997, annotated, on June 27, 1997,
at the dorsal portion of OCT No. 10824.

"In the meantime, the RD cancelled, on July 10, 1997, OCT No. 10824 and issued Transfer Certificate
of Title [TCT] No. 6683 to and under the name of Rodrigo over Lot 243. The "Notice of Lis Pendens" x
x x was carried over in TCT No. 6683.

"Subsequently, Rodrigo secured a loan from the Rizal Commercial Banking Corporation in the amount
of P2,000,000.00 and executed a "Real Estate Mortgage" over the [subject] property as security
therefor.
"On motion of the [petitioners], they were granted x x x leave to file an "Amended Complaint"
impleading the bank as [additional] party-defendant. On November 26, 1997, [petitioners] filed their
"Amended Complaint".

The [respondent] opposed the "Amended Complaint" x x x contending that it was improper for
[petitioners] to join, in their complaint, an ordinary civil action for the nullification of the "Real Estate
Mortgage" executed by the respondent in favor of the Bank as the action of the petitioners before the
court was a special civil action.

"On March 30, 1998, the court issued an Order rejecting the "Amended Complaint" of the petitioners
on the grounds that: (a) the Bank cannot be impleaded as party-defendant under Rule 63, Section 1 of
the 1997 Rules of Civil Procedure; (b) the "Amended Complaint" constituted a collateral attack on TCT
No. 6683. The [petitioners] did not file any motion for the reconsideration of the order of the court."4

The trial court dismissed the Complaint and ordered the cancellation of the lis pendens annotated at the back
of TCT No. 6683. It held that, pursuant to Article 493 of the Civil Code, a co-owner has the right to sell his/her
undivided share. The sale made by a co-owner is not invalidated by the absence of the consent of the other co-
owners. Hence, the sale by Esperanza of the 10,000-square-meter portion of the property was valid; the
excess from her undivided share should be taken from the undivided shares of Cristeta and Antonio, who
expressly agreed to and benefited from the sale.

Ruling of the Court of Appeals

The CA held that the sale was valid and binding insofar as Esperanza Balite’s undivided share of the property
was concerned. It affirmed the trial court’s ruling that the lack of consent of the co-owners did not nullify the
sale. The buyer, respondent herein, became a co-owner of the property to the extent of the pro indiviso share
of the vendor, subject to the portion that may be allotted to him upon the termination of the co-ownership. The
appellate court disagreed with the averment of petitioners that the registration of the sale and the issuance of
TCT No. 6683 was ineffective and that they became the owners of the share of Esperanza upon the latter’s
death.

The CA likewise rejected petitioners’ claim that the sale was void allegedly because the actual purchase price
of the property was not stated in the Deed of Absolute Sale. It found that the true and correct consideration for
the sale was P1,000,000 as declared by Esperanza and respondent in their Joint Affidavit. Applying Article
13535 of the Civil Code, it held that the falsity of the price or consideration stated in the Deed did not render it
void. The CA pointed out, however, that the State retained the right to recover the capital gains tax based on
the true price of P1,000,000.

The appellate court rejected petitioners’ contention that, because of the allegedly unconscionably low and
inadequate consideration involved, the transaction covered by the Deed was an equitable mortgage under
Article 1602 of the Civil Code. Observing that the argument had never been raised in the court a quo, it ruled
that petitioners were proscribed from making this claim, for the first time, on appeal.

The CA further held that the remaining liability of respondent was P120,000. It relied on the Receipt dated
August 24, 1996, which stated that his outstanding balance for the consideration was P350,000. It deducted
therefrom the amounts of P30,000 received by Antonio on August 27, 1996; and P200,000, which was the
amount of the check dated September 15, 1996, issued by respondent payable to Esperanza.

Finally, the appellate court noted that the mortgage over the property had been executed after the filing of the
Complaint. What petitioners should have filed was a supplemental complaint instead of an amended complaint.
Contrary to respondent’s argument, it also held that the bank was not an indispensable party to the case; but
was merely a proper party. Thus, there is no necessity to implead it as party-defendant, although the court a
quo had the option to do so. And even if it were not impleaded, the appellate court ruled that the bank would
still have been bound by the outcome of the case, as the latter was a mortgagee pendente lite over real estate
that was covered by a certificate of title with an annotated lis pendens.
Hence, this Petition.6

Issues

In their Memorandum, petitioners present the following issues:

"A

"Whether or not the [CA] seriously erred in not deciding that the Deed of Absolute Sale dated April 16,
1996 is null and void on the grounds that it is falsified; it has an unlawful cause; and it is contrary to law
and/or public policy.

"B

"Whether or not the [CA] gravely erred in not finding that the amount paid by [respondent] is only three
hundred twenty thousand (P320,000.00) pesos and that respondent’s claim that he has paid one
million pesos except P44,000.00 as balance, is fraudulent and false.

"C

"Whether or not the [CA] seriously erred in not deciding that at the time the Deed of Sale was
registered x x x on May 30, 1997, said Deed of Sale can no longer bind the property covered by OCT
No. 10824 because said land had already become the property of all the petitioners upon the death of
their mother on October 31, 1996 and therefore such registration is functus of[f]icio involving a null and
void document.

"D

"Whether or not the [CA] seriously erred in not ruling that petitioners’ amended complaint dated
November 27, 1997 was proper and admissible and deemed admitted to conform to evidence
presented.

"E

"Whether or not the [CA] seriously erred in not declaring that TCT No. T-6683 in the name of
Respondent Rodrigo N. Lim is null and void and all dealings involving the same are likewise null and
void and/or subject to the decision of the case at bar in view of the notice of lis pendens annotated
therein.

"F

"Even assuming but without admitting that the Deed of Sale is enforceable, the respondent court
seriously erred in not deciding that the consideration is unconscionably low and inadequate and
therefore the transaction between the executing parties constitutes an equitable mortgage.

"G

"The [CA] greatly erred in not rendering judgment awarding damages and attorney’s fee[s] in favor of
petitioners among others."7

In sum, the issues raised by petitioners center on the following: 1) whether the Deed of Absolute Sale is valid,
and 2) whether there is still any sum for which respondent is liable.

The Court’s Ruling


The Petition has no merit.

First Issue:

Validity of the Sale

Petitioners contend that the Deed of Absolute Sale is null and void, because the undervalued consideration
indicated therein was intended for an unlawful purpose -- to avoid the payment of higher capital gains taxes on
the transaction. According to them, the appellate court’s reliance on Article 1353 of the Civil Code was
erroneous. They further contend that the Joint Affidavit is not proof of a true and lawful cause, but an integral
part of a scheme to evade paying lawful taxes and registration fees to the government.

We have before us an example of a simulated contract. Article 1345 of the Civil Code provides that the
simulation of a contract may either be absolute or relative. In absolute simulation, there is a colorable contract
but without any substance, because the parties have no intention to be bound by it. An absolutely simulated
contract is void, and the parties may recover from each other what they may have given under the
"contract."8 On the other hand, if the parties state a false cause in the contract to conceal their real agreement,
such a contract is relatively simulated. Here, the parties’ real agreement binds them. 9

In the present case, the parties intended to be bound by the Contract, even if it did not reflect the actual
purchase price of the property. That the parties intended the agreement to produce legal effect is revealed by
the letter of Esperanza Balite to respondent dated October 23, 199610 and petitioners’ admission that there was
a partial payment of P320,000 made on the basis of the Deed of Absolute Sale. There was an intention to
transfer the ownership of over 10,000 square meters of the property . Clear from the letter is the fact that the
objections of her children prompted Esperanza to unilaterally withdraw from the transaction.

Since the Deed of Absolute Sale was merely relatively simulated, it remains valid and enforceable. All the
essential requisites prescribed by law for the validity and perfection of contracts are present. However, the
parties shall be bound by their real agreement for a consideration of P1,000,000 as reflected in their Joint
Affidavit.11

The juridical nature of the Contract remained the same. What was concealed was merely the actual price.
Where the essential requisites are present and the simulation refers only to the content or terms of the contract,
the agreement is absolutely binding and enforceable12 between the parties and their successors in interest.

Petitioners cannot be permitted to unmake the Contract voluntarily entered into by their predecessor, even if
the stated consideration was included therein for an unlawful purpose. "The binding force of a contract must be
recognized as far as it is legally possible to do so."13 However, as properly held by the appellate court, the
government has the right to collect the proper taxes based on the correct purchase price.

Being onerous, the Contract had for its cause or consideration the price of P1,000,000. Both this consideration
as well as the subject matter of the contract -- Esperanza’s share in the property covered by OCT No. 10824 --
are lawful. The motives of the contracting parties for lowering the price of the sale -- in the present case, the
reduction of capital gains tax liability -- should not be confused with the consideration.14 Although illegal, the
motives neither determine nor take the place of the consideration. 15

Deed of Sale not an


Equitable Mortgage

Petitioner further posits that even assuming that the deed of sale is valid it should only be deemed an equitable
mortgage pursuant to Articles 1602 and 1604 of the Civil Code, because the price was clearly inadequate.
They add that the presence of only one of the circumstances enumerated under Article 1602 would be
sufficient to consider the Contract an equitable mortgage. We disagree.
For Articles 1602 and 1604 to apply, two requisites must concur: one, the parties entered into a contract
denominated as a contract of sale; and, two, their intention was to secure an existing debt by way of
mortgage.16

Indeed, the existence of any of the circumstances enumerated in Article 1602, not a concurrence or an
overwhelming number thereof, suffices to give rise to the presumption that a contract purporting to be an
absolute sale is actually an equitable mortgage.17 In the present case, however, the Contract does not merely
purport to be an absolute sale. The records and the documentary evidence introduced by the parties
indubitably show that the Contract is, indeed, one of absolute sale. There is no clear and convincing evidence
that the parties agreed upon a mortgage of the subject property.

Furthermore, the voluntary, written and unconditional acceptance of contractual commitments negates the
theory of equitable mortgage. There is nothing doubtful about the terms of, or the circumstances surrounding,
the Deed of Sale that would call for the application of Article 1602. The Joint Affidavit indisputably confirmed
that the transaction between the parties was a sale.

When the words of a contract are clear and readily understandable, there is no room for construction. Contracts
are to be interpreted according to their literal meaning and should not be interpreted beyond their obvious
intendment.18The contract is the law between the parties.

Notably, petitioners never raised as an issue before the trial court the fact that the document did not express
the true intent and agreement of the contracting parties. They raised mere suppositions on the inadequacy of
the price, in support of their argument that the Contract should be considered as an equitable mortgage.

We find no basis to conclude that the purchase price of the property was grossly inadequate. Petitioners did not
present any witness to testify as to the market values of real estate in the subject’s locale. They made their
claim on the basis alone of the P2,000,000 loan that respondent had been able to obtain from the Rizal
Commercial Banking Corporation. This move did not sufficiently show the alleged inadequacy of the purchase
price. A mortgage is a mere security for a loan. There was no showing that the property was the only security
relied upon by the bank; or that the borrowers had no credit worthiness, other than the property offered as
collateral.

Co-Ownership

The appellate court was correct in affirming the validity of the sale of the property insofar as the pro
indiviso share of Esperanza Balite was concerned.

Article 493 of the Civil Code19 gives the owner of an undivided interest in the property the right to freely sell and
dispose of such interest. The co-owner, however, has no right to sell or alienate a specific or determinate part
of the thing owned in common, because such right over the thing is represented by an aliquot or ideal portion
without any physical division. Nonetheless, the mere fact that the deed purports to transfer a concrete portion
does not per se render the sale void.20 The sale is valid, but only with respect to the aliquot share of the selling
co-owner. Furthermore, the sale is subject to the results of the partition upon the termination of the co-
ownership.

Hence, the transaction between Esperanza Balite and respondent could be legally recognized only in respect
to the former’s pro indiviso share in the co-ownership. As a matter of fact, the Deed of Absolute Sale executed
between the parties expressly referred to the 10,000-square-meter portion of the land sold to respondent as the
share of Esperanza in the conjugal property. Her clear intention was to sell merely her ideal or undivided share
in it. No valid objection can be made against that intent. Clearly then, the sale can be given effect to the extent
of 9,751 square meters, her ideal share in the property as found by both the trial and the appellate courts.

Transfer of Property

During her lifetime, Esperanza had already sold to respondent her share in the subject parcel; hence her heirs
could no longer inherit it. The property she had transferred or conveyed no longer formed part of her estate to
which her heirs may lay claim at the time of her death. The transfer took effect on April 16, 1996 (the date the
Deed of Absolute Sale was executed), and not on May 30, 1997, when the Deed of Absolute Sale was
registered. Thus, petitioners’ claim that the property became theirs upon the death of their mother is untenable.

Second Issue:

Respondent’s Liability

Petitioners insist that the appellate court erred in holding that respondent’s outstanding liability on the Deed of
Sale was P120,000, when the Receipts on record show payments in the total amount of P320,000 only. They
argue that the August 24, 1996 Receipt, on which the appellate court based its conclusion, was unreliable.

To begin with, this Court is not a trier of facts. 21 It is not its function to examine and determine the weight of the
evidence. Well-entrenched is the doctrine that only errors of law,22 and not of facts, are reviewable by this Court
in a petition for review on certiorari under Rule 45 of the Revised Rules of Court. Philippine Airlines, Inc. v.
Court of Appeals23 has held that factual findings of the Court of Appeals are binding and conclusive upon the
Supreme Court. These findings may be reviewed24 only under exceptional circumstances such as, among
others, when the inference is manifestly mistaken;25 the judgment is based on a misapprehension of
facts;26 findings of the trial court contradict those of the CA;27 or the CA manifestly overlooked certain relevant
and undisputed facts that, if properly considered, would justify a different conclusion.28

Although the factual findings of the two lower courts were not identical, we hold that in the present case, the
findings of the CA are in accord with the documents on record. The trial court admitted in evidence the August
24, 1996 Receipt signed by Antonio Balite. Interestingly, he was never presented in the lower court to dispute
the veracity of the contents of that Receipt, particularly the second paragraph that had categorically stated the
outstanding balance of respondent as of August 24, 1996, to be P350,000. Furthermore, the evidence shows
that subsequent payments of P30,000 and P200,000 were made by the latter. Thus, we affirm the CA’s
Decision holding that the remaining unpaid balance of the price was P120,000.

WHEREFORE, the Petition is DENIED and the assailed Decision AFFIRMED. Costs against the petitioners.
G.R. No. 163744 February 29, 2008

METROPOLITAN BANK AND TRUST CO., petitioner,


vs.
NICHOLSON PASCUAL a.k.a. NELSON PASCUAL, respondent.

DECISION

VELASCO, JR., J.:

Respondent Nicholson Pascual and Florencia Nevalga were married on January 19, 1985. During the union,
Florencia bought from spouses Clarito and Belen Sering a 250-square meter lot with a three-door apartment
standing thereon located in Makati City. Subsequently, Transfer Certificate of Title (TCT) No. S-101473/T-510
covering the purchased lot was canceled and, in lieu thereof, TCT No. 1562831 of the Registry of Deeds of
Makati City was issued in the name of Florencia, "married to Nelson Pascual" a.k.a. Nicholson Pascual.

In 1994, Florencia filed a suit for the declaration of nullity of marriage under Article 36 of the Family Code,
docketed as Civil Case No. Q-95-23533. After trial, the Regional Trial Court (RTC), Branch 94 in Quezon City
rendered, on July 31, 1995, a Decision,2 declaring the marriage of Nicholson and Florencia null and void on the
ground of psychological incapacity on the part of Nicholson. In the same decision, the RTC, inter alia, ordered
the dissolution and liquidation of the ex-spouses’ conjugal partnership of gains. Subsequent events saw the
couple going their separate ways without liquidating their conjugal partnership.

On April 30, 1997, Florencia, together with spouses Norberto and Elvira Oliveros, obtained a PhP 58 million
loan from petitioner Metropolitan Bank and Trust Co. (Metrobank). To secure the obligation, Florencia and the
spouses Oliveros executed several real estate mortgages (REMs) on their properties, including one involving
the lot covered by TCT No. 156283. Among the documents Florencia submitted to procure the loan were a
copy of TCT No. 156283, a photocopy of the marriage-nullifying RTC decision, and a document denominated
as "Waiver" that Nicholson purportedly executed on April 9, 1995. The waiver, made in favor of Florencia,
covered the conjugal properties of the ex-spouses listed therein, but did not incidentally include the lot in
question.

Due to the failure of Florencia and the spouses Oliveros to pay their loan obligation when it fell due, Metrobank,
on November 29, 1999, initiated foreclosure proceedings under Act No. 3135, as amended, before the Office of
the Notary Public of Makati City. Subsequently, Metrobank caused the publication of the notice of sale on three
issues of Remate.3 At the auction sale on January 21, 2000, Metrobank emerged as the highest bidder.

Getting wind of the foreclosure proceedings, Nicholson filed on June 28, 2000, before the RTC in Makati City, a
Complaint to declare the nullity of the mortgage of the disputed property, docketed as Civil Case No. 00-789
and eventually raffled to Branch 65 of the court. In it, Nicholson alleged that the property, which is still conjugal
property, was mortgaged without his consent.

Metrobank, in its Answer with Counterclaim and Cross-Claim,4 alleged that the disputed lot, being registered in
Florencia’s name, was paraphernal. Metrobank also asserted having approved the mortgage in good faith.

Florencia did not file an answer within the reglementary period and, hence, was subsequently declared in
default.

The RTC Declared the REM Invalid

After trial on the merits, the RTC rendered, on September 24, 2001, judgment finding for Nicholson.
The fallo reads:
PREMISES CONSIDERED, the Court renders judgment declaring the real estate mortgage on the
property covered by [TCT] No. 156283 of the Registry of Deeds for the City of Makati as well as all
proceedings thereon null and void.

The Court further orders defendants [Metrobank and Florencia] jointly and severally to pay plaintiff
[Nicholson]:

1. PhP100,000.00 by way of moral damages;

2. PhP75,000.00 by way of attorney’s fees; and

3. The costs.

SO ORDERED.5

Even as it declared the invalidity of the mortgage, the trial court found the said lot to be conjugal, the same
having been acquired during the existence of the marriage of Nicholson and Florencia. In so ruling, the RTC
invoked Art. 116 of the Family Code, providing that "all property acquired during the marriage, whether the
acquisition appears to have been made, contracted or registered in the name of one or both spouses, is
presumed to be conjugal unless the contrary is proved." To the trial court, Metrobank had not overcome the
presumptive conjugal nature of the lot. And being conjugal, the RTC concluded that the disputed property may
not be validly encumbered by Florencia without Nicholson’s consent.

The RTC also found the deed of waiver Florencia submitted to Metrobank to be fatally defective. For let alone
the fact that Nicholson denied executing the same and that the signature of the notarizing officer was a forgery,
the waiver document was allegedly executed on April 9, 1995 or a little over three months before the issuance
of the RTC decision declaring the nullity of marriage between Nicholson and Florencia.

The trial court also declared Metrobank as a mortgagee in bad faith on account of negligence, stating the
observation that certain data appeared in the supporting contract documents, which, if properly scrutinized,
would have put the bank on guard against approving the mortgage. Among the data referred to was the date of
execution of the deed of waiver.

The RTC dismissed Metrobank’s counterclaim and cross-claim against the ex-spouses.

Metrobank’s motion for reconsideration was denied. Undeterred, Metrobank appealed to the Court of Appeals
(CA), the appeal docketed as CA-G.R. CV No. 74874.

The CA Affirmed with Modification the RTC’s Decision

On January 28, 2004, the CA rendered a Decision affirmatory of that of the RTC, except for the award therein
of moral damages and attorney’s fees which the CA ordered deleted. The dispositive portion of the CA’s
Decision reads:

WHEREFORE, premises considered, the appealed decision is hereby AFFIRMED WITH


MODIFICATION with respect to the award of moral damages and attorney’s fees which is hereby
DELETED.

SO ORDERED.6

Like the RTC earlier held, the CA ruled that Metrobank failed to overthrow the presumption established in Art.
116 of the Family Code. And also decreed as going against Metrobank was Florencia’s failure to comply with
the prescriptions of the succeeding Art. 124 of the Code on the disposition of conjugal partnership property. Art.
124 states:
Art. 124. The administration and enjoyment of the conjugal partnership property shall belong to both
spouses jointly. In case of disagreement, the husband’s decision shall prevail, subject to recourse to
the court by the wife for proper remedy x x x.

In the event that one spouse is incapacitated or otherwise unable to participate in the administration of
the conjugal properties, the other spouse may assume sole powers of administration. These powers
do not include disposition or encumbrance without authority of the court or written consent of the other
spouse. In the absence of such authority or consent, the disposition or encumbrance shall be void.
However, the transaction shall be construed as a continuing offer on the part of the consenting spouse
and the third person, and may be perfected as a binding contract upon the acceptance by the other
spouse or authorization by the court before the offer is withdrawn by either or both offerors.

As to the deletion of the award of moral damages and attorney’s fees, the CA, in gist, held that Metrobank did
not enter into the mortgage contract out of ill-will or for some fraudulent purpose, moral obliquity, or like
dishonest considerations as to justify damages.

Metrobank moved but was denied reconsideration by the CA.

Thus, Metrobank filed this Petition for Review on Certiorari under Rule 45, raising the following issues for
consideration:

a. Whether or not the [CA] erred in declaring subject property as conjugal by applying Article 116 of the
Family Code.

b. Whether or not the [CA] erred in not holding that the declaration of nullity of marriage between the
respondent Nicholson Pascual and Florencia Nevalga ipso facto dissolved the regime of community of
property of the spouses.

c. Whether or not the [CA] erred in ruling that the petitioner is an innocent purchaser for value. 7

Our Ruling

A modification of the CA’s Decision is in order.

The Disputed Property is Conjugal

It is Metrobank’s threshold posture that Art. 160 of the Civil Code providing that "[a]ll property of the marriage is
presumed to belong to the conjugal partnership, unless it be prove[n] that it pertains exclusively to the husband
or to the wife," applies. To Metrobank, Art. 116 of the Family Code could not be of governing application
inasmuch as Nicholson and Florencia contracted marriage before the effectivity of the Family Code on August
3, 1988. Citing Manongsong v. Estimo,8 Metrobank asserts that the presumption of conjugal ownership under
Art. 160 of the Civil Code applies when there is proof that the property was acquired during the marriage.
Metrobank adds, however, that for the presumption of conjugal ownership to operate, evidence must be
adduced to prove that not only was the property acquired during the marriage but that conjugal funds were
used for the acquisition, a burden Nicholson allegedly failed to discharge.

To bolster its thesis on the paraphernal nature of the disputed property, Metrobank cites Francisco v. Court of
Appeals9 and Jocson v. Court of Appeals,10 among other cases, where this Court held that a property registered
in the name of a certain person with a description of being married is no proof that the property was acquired
during the spouses’ marriage.

On the other hand, Nicholson, banking on De Leon v. Rehabilitation Finance Corporation11 and Wong v.
IAC,12contends that Metrobank failed to overcome the legal presumption that the disputed property is conjugal.
He asserts that Metrobank’s arguments on the matter of presumption are misleading as only one postulate
needs to be shown for the presumption in favor of conjugal ownership to arise, that is, the fact of acquisition
during marriage. Nicholson dismisses, as inapplicable, Francisco and Jocson, noting that they are relevant only
when there is no indication as to the exact date of acquisition of the property alleged to be conjugal.

As a final point, Nicholson invites attention to the fact that Metrobank had virtually recognized the conjugal
nature of the property in at least three instances. The first was when the bank lumped him with Florencia in
Civil Case No. 00-789 as co-mortgagors and when they were referred to as "spouses" in the petition for
extrajudicial foreclosure of mortgage. Then came the published notice of foreclosure sale where Nicholson was
again designated as co-mortgagor. And third, in its demand-letter13 to vacate the disputed lot, Metrobank
addressed Nicholson and Florencia as "spouses," albeit the finality of the decree of nullity of marriage between
them had long set in.

We find for Nicholson.

First, while Metrobank is correct in saying that Art. 160 of the Civil Code, not Art. 116 of the Family Code, is the
applicable legal provision since the property was acquired prior to the enactment of the Family Code, it errs in
its theory that, before conjugal ownership could be legally presumed, there must be a showing that the property
was acquired during marriage using conjugal funds. Contrary to Metrobank’s submission, the Court did not,
in Manongsong,14 add the matter of the use of conjugal funds as an essential requirement for the presumption
of conjugal ownership to arise. Nicholson is correct in pointing out that only proof of acquisition during the
marriage is needed to raise the presumption that the property is conjugal. Indeed, if proof on the use of
conjugal is still required as a necessary condition before the presumption can arise, then the legal presumption
set forth in the law would veritably be a superfluity. As we stressed in Castro v. Miat:

Petitioners also overlook Article 160 of the New Civil Code. It provides that "all property of the
marriage is presumed to be conjugal partnership, unless it be prove[n] that it pertains exclusively to the
husband or to the wife." This article does not require proof that the property was acquired with
funds of the partnership. The presumption applies even when the manner in which the property was
acquired does not appear.15(Emphasis supplied.)

Second, Francisco and Jocson do not reinforce Metrobank’s theory. Metrobank would thrust on the Court,
invoking the two cases, the argument that the registration of the property in the name of "Florencia Nevalga,
married to Nelson Pascual" operates to describe only the marital status of the title holder, but not as proof that
the property was acquired during the existence of the marriage.

Metrobank is wrong. As Nicholson aptly points out, if proof obtains on the acquisition of the property during the
existence of the marriage, then the presumption of conjugal ownership applies. The correct lesson
of Francisco and Jocson is that proof of acquisition during the marital coverture is a condition sine qua non for
the operation of the presumption in favor of conjugal ownership. When there is no showing as to when the
property was acquired by the spouse, the fact that a title is in the name of the spouse is an indication that the
property belongs exclusively to said spouse.16

The Court, to be sure, has taken stock of Nicholson’s arguments regarding Metrobank having implicitly
acknowledged, thus being in virtual estoppel to question, the conjugal ownership of the disputed lot, the bank
having named the former in the foreclosure proceedings below as either the spouse of Florencia or her co-
mortgagor. It is felt, however, that there is no compelling reason to delve into the matter of estoppel, the same
having been raised only for the first time in this petition. Besides, however Nicholson was designated below
does not really change, one way or another, the classification of the lot in question.

Termination of Conjugal Property Regime does


not ipso facto End the Nature of Conjugal Ownership

Metrobank next maintains that, contrary to the CA’s holding, Art. 129 of the Family Code is inapplicable. Art.
129 in part reads:

Art. 129. Upon the dissolution of the conjugal partnership regime, the following procedure shall apply:
xxxx

(7) The net remainder of the conjugal partnership properties shall constitute the profits, which shall be
divided equally between husband and wife, unless a different proportion or division was agreed upon
in the marriage settlements or unless there has been a voluntary waiver or forfeiture of such share as
provided in this Code.

Apropos the aforequoted provision, Metrobank asserts that the waiver executed by Nicholson, effected
as it were before the dissolution of the conjugal property regime, vested on Florencia full ownership of
all the properties acquired during the marriage.

Nicholson counters that the mere declaration of nullity of marriage, without more, does not automatically result
in a regime of complete separation when it is shown that there was no liquidation of the conjugal assets.

We again find for Nicholson.

While the declared nullity of marriage of Nicholson and Florencia severed their marital bond and dissolved the
conjugal partnership, the character of the properties acquired before such declaration continues to subsist as
conjugal properties until and after the liquidation and partition of the partnership. This conclusion holds true
whether we apply Art. 129 of the Family Code on liquidation of the conjugal partnership’s assets and liabilities
which is generally prospective in application, or Section 7, Chapter 4, Title IV, Book I (Arts. 179 to 185) of the
Civil Code on the subject, Conjugal Partnership of Gains. For, the relevant provisions of both Codes first
require the liquidation of the conjugal properties before a regime of separation of property reigns.

In Dael v. Intermediate Appellate Court, we ruled that pending its liquidation following its dissolution, the
conjugal partnership of gains is converted into an implied ordinary co-ownership among the surviving spouse
and the other heirs of the deceased.17

In this pre-liquidation scenario, Art. 493 of the Civil Code shall govern the property relationship between the
former spouses, where:

Each co-owner shall have the full ownership of his part and of the fruits and benefits pertaining thereto,
and he may therefore alienate, assign or mortgage it, and even substitute another person in its
enjoyment, except when personal rights are involved. But the effect of the alienation or the
mortgage, with respect to the co-owners, shall be limited to the portion which may be allotted
to him in the division upon the termination of the co-ownership. (Emphasis supplied.)

In the case at bar, Florencia constituted the mortgage on the disputed lot on April 30, 1997, or a little less than
two years after the dissolution of the conjugal partnership on July 31, 1995, but before the liquidation of the
partnership. Be that as it may, what governed the property relations of the former spouses when the mortgage
was given is the aforequoted Art. 493. Under it, Florencia has the right to mortgage or even sell her one-half
(1/2) undivided interest in the disputed property even without the consent of Nicholson. However, the rights of
Metrobank, as mortgagee, are limited only to the 1/2 undivided portion that Florencia owned. Accordingly, the
mortgage contract insofar as it covered the remaining 1/2 undivided portion of the lot is null and void, Nicholson
not having consented to the mortgage of his undivided half.

The conclusion would have, however, been different if Nicholson indeed duly waived his share in the conjugal
partnership. But, as found by the courts a quo, the April 9, 1995 deed of waiver allegedly executed by
Nicholson three months prior to the dissolution of the marriage and the conjugal partnership of gains on July
31, 1995 bore his forged signature, not to mention that of the notarizing officer. A spurious deed of waiver does
not transfer any right at all, albeit it may become the root of a valid title in the hands of an innocent buyer for
value.

Upon the foregoing perspective, Metrobank’s right, as mortgagee and as the successful bidder at the auction of
the lot, is confined only to the 1/2 undivided portion thereof heretofore pertaining in ownership to Florencia. The
other undivided half belongs to Nicholson. As owner pro indiviso of a portion of the lot in question, Metrobank
may ask for the partition of the lot and its property rights "shall be limited to the portion which may be allotted to
[the bank] in the division upon the termination of the co-ownership."18 This disposition is in line with the well-
established principle that the binding force of a contract must be recognized as far as it is legally possible to do
so––quando res non valet ut ago, valeat quantum valere potest.19

In view of our resolution on the validity of the auction of the lot in favor of Metrobank, there is hardly a need to
discuss at length whether or not Metrobank was a mortgagee in good faith. Suffice it to state for the nonce that
where the mortgagee is a banking institution, the general rule that a purchaser or mortgagee of the land need
not look beyond the four corners of the title is inapplicable.20 Unlike private individuals, it behooves banks to
exercise greater care and due diligence before entering into a mortgage contract. The ascertainment of the
status or condition of the property offered as security and the validity of the mortgagor’s title must be standard
and indispensable part of the bank’s operation.21 A bank that failed to observe due diligence cannot be
accorded the status of a bona fide mortgagee,22 as here.

But as found by the CA, however, Metrobank’s failure to comply with the due diligence requirement was not the
result of a dishonest purpose, some moral obliquity or breach of a known duty for some interest or ill-will that
partakes of fraud that would justify damages.

WHEREFORE, the petition is PARTLY GRANTED. The appealed Decision of the CA dated January 28, 2004,
upholding with modification the Decision of the RTC, Branch 65 in Makati City, in Civil Case No. 00-789,
is AFFIRMED with the MODIFICATION that the REM over the lot covered by TCT No. 156283 of the Registry
of Deeds of Makati City is hereby declared valid only insofar as the pro indiviso share of Florencia thereon is
concerned.

As modified, the Decision of the RTC shall read:

PREMISES CONSIDERED, the real estate mortgage on the property covered by TCT No. 156283 of the
Registry of Deeds of Makati City and all proceedings thereon are NULL and VOID with respect to the undivided
1/2 portion of the disputed property owned by Nicholson, but VALID with respect to the other undivided 1/2
portion belonging to Florencia. The claims of Nicholson for moral damages and attorney’s fees are DENIED for
lack of merit.
G.R. No. 157537 September 7, 2011

THE HEIRS OF PROTACIO GO, SR. and MARTA BAROLA, namely: LEONOR, SIMPLICIO, PROTACIO,
JR., ANTONIO, BEVERLY ANN LORRAINNE, TITA, CONSOLACION, LEONORA and ASUNCION, all
surnamed GO, represented by LEONORA B. GO, Petitioners,
vs.
ESTER L. SERVACIO and RITO B. GO, Respondents.

DECISION

BERSAMIN, J.:

The disposition by sale of a portion of the conjugal property by the surviving spouse without the prior liquidation
mandated by Article 130 of the Family Code is not necessarily void if said portion has not yet been allocated by
judicial or extrajudicial partition to another heir of the deceased spouse. At any rate, the requirement of prior
liquidation does not prejudice vested rights.

Antecedents

On February 22, 1976, Jesus B. Gaviola sold two parcels of land with a total area of 17,140 square meters
situated in Southern Leyte to Protacio B. Go, Jr. (Protacio, Jr.). Twenty three years later, or on March 29, 1999,
Protacio, Jr. executed an Affidavit of Renunciation and Waiver,1 whereby he affirmed under oath that it was his
father, Protacio Go, Sr. (Protacio, Sr.), not he, who had purchased the two parcels of land (the property).

On November 25, 1987, Marta Barola Go died. She was the wife of Protacio, Sr. and mother of the
petitioners.2 On December 28, 1999, Protacio, Sr. and his son Rito B. Go (joined by Rito’s wife Dina B. Go) sold
a portion of the property with an area of 5,560 square meters to Ester L. Servacio (Servacio) for
₱5,686,768.00.3 On March 2, 2001, the petitioners demanded the return of the property,4 but Servacio refused
to heed their demand. After barangay proceedings failed to resolve the dispute,5 they sued Servacio and Rito in
the Regional Trial Court in Maasin City, Southern Leyte (RTC) for the annulment of the sale of the property.

The petitioners averred that following Protacio, Jr.’s renunciation, the property became conjugal property; and
that the sale of the property to Servacio without the prior liquidation of the community property between
Protacio, Sr. and Marta was null and void.6

Servacio and Rito countered that Protacio, Sr. had exclusively owned the property because he had purchased
it with his own money.7

On October 3, 2002,8 the RTC declared that the property was the conjugal property of Protacio, Sr. and Marta,
not the exclusive property of Protacio, Sr., because there were three vendors in the sale to Servacio (namely:
Protacio, Sr., Rito, and Dina); that the participation of Rito and Dina as vendors had been by virtue of their
being heirs of the late Marta; that under Article 160 of the Civil Code, the law in effect when the property was
acquired, all property acquired by either spouse during the marriage was conjugal unless there was proof that
the property thus acquired pertained exclusively to the husband or to the wife; and that Protacio, Jr.’s
renunciation was grossly insufficient to rebut the legal presumption.9

Nonetheless, the RTC affirmed the validity of the sale of the property, holding that: "xxx As long as the portion
sold, alienated or encumbered will not be allotted to the other heirs in the final partition of the property, or to
state it plainly, as long as the portion sold does not encroach upon the legitimate (sic) of other heirs, it is
valid."10 Quoting Tolentino’s commentary on the matter as authority,11 the RTC opined:

In his comment on Article 175 of the New Civil Code regarding the dissolution of the conjugal partnership,
Senator Arturo Tolentino, says" [sic]
"Alienation by the survivor. — After the death of one of the spouses, in case it is necessary to sell any portion
of the community property in order to pay outstanding obligation of the partnership, such sale must be made in
the manner and with the formalities established by the Rules of Court for the sale of the property of the
deceased persons. Any sale, transfer, alienation or disposition of said property affected without said formalities
shall be null and void, except as regards the portion that belongs to the vendor as determined in the liquidation
and partition. Pending the liquidation, the disposition must be considered as limited only to the contingent share
or interest of the vendor in the particular property involved, but not to the corpus of the property.

This rule applies not only to sale but also to mortgages. The alienation, mortgage or disposal of the conjugal
property without the required formality, is not however, null ab initio, for the law recognizes their validity so long
as they do not exceed the portion which, after liquidation and partition, should pertain to the surviving spouse
who made the contract." [underlining supplied]

It seems clear from these comments of Senator Arturo Tolentino on the provisions of the New Civil Code and
the Family Code on the alienation by the surviving spouse of the community property that jurisprudence
remains the same - that the alienation made by the surviving spouse of a portion of the community property is
not wholly void ab initio despite Article 103 of the Family Code, and shall be valid to the extent of what will be
allotted, in the final partition, to the vendor. And rightly so, because why invalidate the sale by the surviving
spouse of a portion of the community property that will eventually be his/her share in the final partition?
Practically there is no reason for that view and it would be absurd.

Now here, in the instant case, the 5,560 square meter portion of the 17,140 square-meter conjugal lot is
certainly mush (sic) less than what vendors Protacio Go and his son Rito B. Go will eventually get as their
share in the final partition of the property. So the sale is still valid.

WHEREFORE, premises considered, complaint is hereby DISMISSED without pronouncement as to cost and
damages.

SO ORDERED.12

The RTC’s denial of their motion for reconsideration13 prompted the petitioners to appeal directly to the Court
on a pure question of law.

Issue

The petitioners claim that Article 130 of the Family Code is the applicable law; and that the sale by Protacio,
Sr., et al. to Servacio was void for being made without prior liquidation.

In contrast, although they have filed separate comments, Servacio and Rito both argue that Article 130 of the
Family Code was inapplicable; that the want of the liquidation prior to the sale did not render the sale invalid,
because the sale was valid to the extent of the portion that was finally allotted to the vendors as his share; and
that the sale did not also prejudice any rights of the petitioners as heirs, considering that what the sale
disposed of was within the aliquot portion of the property that the vendors were entitled to as heirs. 14

Ruling

The appeal lacks merit.

Article 130 of the Family Code reads:

Article 130. Upon the termination of the marriage by death, the conjugal partnership property shall be liquidated
in the same proceeding for the settlement of the estate of the deceased.

If no judicial settlement proceeding is instituted, the surviving spouse shall liquidate the conjugal partnership
property either judicially or extra-judicially within one year from the death of the deceased spouse. If upon the
lapse of the six month period no liquidation is made, any disposition or encumbrance involving the conjugal
partnership property of the terminated marriage shall be void.

Should the surviving spouse contract a subsequent marriage without compliance with the foregoing
requirements, a mandatory regime of complete separation of property shall govern the property relations of the
subsequent marriage.

Article 130 is to be read in consonance with Article 105 of the Family Code, viz:

Article 105. In case the future spouses agree in the marriage settlements that the regime of conjugal
partnership of gains shall govern their property relations during marriage, the provisions in this Chapter shall be
of supplementary application.

The provisions of this Chapter shall also apply to conjugal partnerships of gains already established between
spouses before the effectivity of this Code, without prejudice to vested rights already acquired in accordance
with the Civil Code or other laws, as provided in Article 256. (n) [emphasis supplied]

It is clear that conjugal partnership of gains established before and after the effectivity of the Family Code are
governed by the rules found in Chapter 4 (Conjugal Partnership of Gains) of Title IV (Property Relations
Between Husband And Wife) of the Family Code. Hence, any disposition of the conjugal property after the
dissolution of the conjugal partnership must be made only after the liquidation; otherwise, the disposition is
void.

Before applying such rules, however, the conjugal partnership of gains must be subsisting at the time of the
effectivity of the Family Code. There being no dispute that Protacio, Sr. and Marta were married prior to the
effectivity of the Family Code on August 3, 1988, their property relation was properly characterized as one of
conjugal partnership governed by the Civil Code. Upon Marta’s death in 1987, the conjugal partnership was
dissolved, pursuant to Article 175 (1) of the Civil Code,15 and an implied ordinary co-ownership ensued among
Protacio, Sr. and the other heirs of Marta with respect to her share in the assets of the conjugal partnership
pending a liquidation following its liquidation.16 The ensuing implied ordinary co-ownership was governed by
Article 493 of the Civil Code,17 to wit:

Article 493. Each co-owner shall have the full ownership of his part and of the fruits and benefits pertaining
thereto, and he may therefore alienate, assign or mortgage it, and even substitute another person in its
enjoyment, except when personal rights are involved. But the effect of the alienation or the mortgage, with
respect to the co-owners, shall be limited to the portion which may be allotted to him in the division upon the
termination of the co-ownership. (399)

Protacio, Sr., although becoming a co-owner with his children in respect of Marta’s share in the conjugal
partnership, could not yet assert or claim title to any specific portion of Marta’s share without an actual partition
of the property being first done either by agreement or by judicial decree. Until then, all that he had was an
ideal or abstract quota in Marta’s share.18 Nonetheless, a co-owner could sell his undivided share; hence,
Protacio, Sr. had the right to freely sell and dispose of his undivided interest, but not the interest of his co-
owners.19 Consequently, the sale by Protacio, Sr. and Rito as co-owners without the consent of the other co-
owners was not necessarily void, for the rights of the selling co-owners were thereby effectively transferred,
making the buyer (Servacio) a co-owner of Marta’s share.20 This result conforms to the well-established
principle that the binding force of a contract must be recognized as far as it is legally possible to do so (quando
res non valet ut ago, valeat quantum valere potest).21

Article 105 of the Family Code, supra, expressly provides that the applicability of the rules on dissolution of the
conjugal partnership is "without prejudice to vested rights already acquired in accordance with the Civil Code or
other laws." This provision gives another reason not to declare the sale as entirely void. Indeed, such a
declaration prejudices the rights of Servacio who had already acquired the shares of Protacio, Sr. and Rito in
the property subject of the sale.
In their separate comments,22 the respondents aver that each of the heirs had already received "a certain
allotted portion" at the time of the sale, and that Protacio, Sr. and Rito sold only the portions adjudicated to and
owned by them. However, they did not present any public document on the allocation among her heirs,
including themselves, of specific shares in Marta’s estate. Neither did they aver that the conjugal properties had
already been liquidated and partitioned. Accordingly, pending a partition among the heirs of Marta, the efficacy
of the sale, and whether the extent of the property sold adversely affected the interests of the petitioners might
not yet be properly decided with finality. The appropriate recourse to bring that about is to commence an action
for judicial partition, as instructed in Bailon-Casilao v. Court of Appeals,23 to wit:

From the foregoing, it may be deduced that since a co-owner is entitled to sell his undivided share, a sale of the
entire property by one

co-owner without the consent of the other co-owners is not null and void. However, only the rights of the co-
owner-seller are transferred, thereby making the buyer a co-owner of the property.

The proper action in cases like this is not for the nullification of the sale or for the recovery of possession of the
thing owned in common from the third person who substituted the co-owner or co-owners who alienated their
shares, but the DIVISION of the common property as if it continued to remain in the possession of the co-
owners who possessed and administered it [Mainit v. Bandoy, supra]. 1avv phi1

Thus, it is now settled that the appropriate recourse of co-owners in cases where their consent were not
secured in a sale of the entire property as well as in a sale merely of the undivided shares of some of the co-
owners is an action for PARTITION under Rule 69 of the Revised Rules of Court. xxx24

In the meanwhile, Servacio would be a trustee for the benefit of the co-heirs of her vendors in respect of any
portion that might not be validly sold to her. The following observations of Justice Paras are explanatory of this
result, viz:

xxx [I]f it turns out that the property alienated or mortgaged really would pertain to the share of the surviving
spouse, then said transaction is valid. If it turns out that there really would be, after liquidation, no more
conjugal assets then the whole transaction is null and void. But if it turns out that half of the property thus
1âw phi1

alienated or mortgaged belongs to the husband as his share in the conjugal partnership, and half should go to
the estate of the wife, then that corresponding to the husband is valid, and that corresponding to the other is
not. Since all these can be determined only at the time the liquidation is over, it follows logically that a disposal
made by the surviving spouse is not void ab initio. Thus, it has been held that the sale of conjugal properties
cannot be made by the surviving spouse without the legal requirements. The sale is void as to the share of the
deceased spouse (except of course as to that portion of the husband’s share inherited by her as the surviving
spouse). The buyers of the property that could not be validly sold become trustees of said portion for the
benefit of the husband’s other heirs, the cestui que trust ent. Said heirs shall not be barred by prescription or by
laches (See Cuison, et al. v. Fernandez, et al.,L-11764, Jan.31, 1959.)25

WHEREFORE, we DENY the petition for review on certiorari; and AFFIRM the decision of the Regional Trial
Court.
G.R. No. L-20449 January 29, 1968

ESPERANZA FABIAN, BENITA FABIAN and DAMASO PAPA Y FABIAN, plaintiffs-appellants,


vs.
SILBINA FABIAN, FELICIANO LANDRITO, TEODORA FABIAN and FRANCISCO DEL
MONTE, defendants-appellees.

Felix Law Office for plaintiffs-appellants.


J.G. Mendoza for defendants-appellees.

CASTRO, J.:

Before us is the appeal taken by Esperanza Fabian, Benita I Fabian and Damaso Papa y Fabian from the
decision of the Court of First Instance of Rizal which dismissed their complaint for reconveyance, in civil case
295-R, filed against the defendants spouses Silbina Fabian and Feliciano Landrito and Teodora Fabian and
Francisco del Monte, upon the ground that the latter had acquired a valid and complete title to the land in
question by acquisitive prescription.

This case traces its origin way back to January 1, 1909 when Pablo Fabian bought from the Philippine
Government lot 164 of the Friar Lands Estate in Muntinlupa, Rizal, of an area 1 hectare, 42 ares and 80
centares, for the sum of P112 payable in installments. 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, 1 and Silbina.

On October 5, 1928 Silbina Fabian and Teodora Fabian, niece of the deceased, executed an affidavit, reciting,
among other things,

Que el finado Pablo Fabian, no dejo ningun otro heredero sino los declarantes, con derecho a heredar
el lote No. 164 de la hacienda Muntinlupa, relicto por dicho finado Pablo Fabian y para la aprobacion
de traspaso a nosotros el referido lote No. 164, prestamos esta declaracion para todos los efectos que
pueden covenir a la Oficina de Terenos a defender por nuestro mayor derecho de heredar dicho lote
contra las reclamaciones juntas de quien las presentare.

On the strength of this affidavit, sale certificate 547 was assigned to them. On November 14, 1928 the acting
Director of Lands, on behalf of the Government, sold lot 164, under deed 17272, to Silbina Fabian, married to
Feliciano Landrito, and to Teodora Fabian, married to Francisco del Monte, for the sum of P120. The vendees
spouses forthwith in 1929 took physical possession thereof, cultivated it, and appropriated the produce
therefrom (and concededly have up to the present been appropriating the fruits from the land exclusively for
themselves). In that same year, they declared the lot in their names for taxation purposes under tax declaration
3374. This tax declaration was later cancelled, and in lieu thereof two tax declarations (2418 and 2419) were
issued in favor of Teodora Fabian and Silbina Fabian, respectively. Since 1929 up to the present, they have
been paying the real estate taxes thereon. In 1937 the Register of Deeds of Rizal issued TCT 33203 over lot
164 in their names. And on May 4, 1945, they subdivided the lot into two equal parts; TCT 33203 was then
cancelled and TCT 38095 was issued over lot 164-A in the name of Silbina Fabian, married to Feliciano
Landrito, and 38096 was issued over lot 164-B in the name of Teodora Fabian, married to Francisco del Monte.

On July 18, 1960 the plaintiffs filed the present action for reconveyance against the defendants spouses,
averring that Silbina and Teodora, through fraud perpetrated in their affidavit aforesaid, made it appear that "el
finado Pablo Fabian no dejo ningun otro heredero sino los declarantes con derecho a heredar el lote No. 164
de la hacienda de Muntinlupa", which is a false narration of facts because Silbina knew that she is not the only
daughter and heir of the deceased Pablo Fabian, and Teodora likewise knew all along that, as a mere niece of
the deceased, she was precluded from inheriting from him in the presence of his four surviving daughters; that
by virtue of this affidavit, the said defendants succeeded in having sale certificate 547 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 under TCT 33203. They further allege that the land has not been transferred to an innocent purchaser
for value. A reconveyance thereof is prayed for, aside from P3,000 attorney's fees and costs.
In their answer of August 31, 1960, 2 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 for the sum of P120, 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.

On the basis of a partial stipulation of facts together with annexes, the lower court rendered judgment on June
28, 1962, declaring that the defendants spouses had acquired a valid and complete title to the property by
acquisitive prescription, and accordingly dismissed the complaint, with costs against the plaintiffs. The latter's
motion for reconsideration was thereafter denied.

Hence, the present recourse.

The three resulting issues of law tendered for resolution in this appeal, by the formulation of the parties are: (1)
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? (2) May laches constitute a
bar to an action to enforce a constructive trust? (3) Has title to the land vested in the appellees through the
mode of acquisitive prescription?

1. 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. 3

That Pablo Fabian had paid five annual installments to the Government, and in fact been issued sale certificate
547 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. 4

The assignment and sale of the lot to the defendants. Silbina and Teodora were therefore null and void as to
that portion sold to Teodora, and as well as to that portion which lawfully devolved in favor of the appellants. 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 (Gayondato vs. Insular Treasurer, 49 Phil. 244).
2. In Diaz, et al. vs. Gorricho, et al., 103 Phil. 264-265 (1958), this Court, speaking through Mr. Justice J.B.L.
Reyes, declared in no uncertain terms that 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 the decision penned by Mr.
Justice Reyes:

Article 1456 of the new Civil Code, while not retroactive in character, merely expresses a rule already
recognized by our courts prior to the Code's 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 (Gayondato vs.
Insular Treasurer, supra). 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.

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 (54
Am. Jur., secs. 580, 581; 65 C.J., secs. 956, 957; Amer. Law Institute, Restatement of Trusts, section
219; on Restitution, section 179; Stianson vs. Stianson 6 ALR 287; Claridad vs. Benares, 97 Phil. 973.

The assignment of sale certificate 547 was effected on October 5, 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." (emphasis supplied.)

3. Six years later, in Gerona, et al. vs. De Guzman, et al., L-19060, May 29, 1964, the factual setting attending
which is substantially similar to that obtaining in the case at bar, this Court, in an excellently-phrased decision
penned by Chief Justice, then Associate Justice, Roberto Concepcion, unequivocally reaffirmed the rule,
overruling previous decisions to the contrary, that "an action for reconveyance of real property based upon a
constructive or implied trust, resulting from fraud, may be barred by the statute of limitations," and further that
"the action therefor may be filed within four years from the discovery of the fraud," 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. The following is what Justice Concepcion, speaking for the Court, said:

[A]lthough, 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 (Cordova vs.
Cordova, L-9936, January 14, 1948). The statute of limitations operates, as in other cases, from the
moment such adverse title is asserted by the possessor of the property (Ramos v. Ramos, 45 Phil.,
362; Bargayo v. Camumot, 40 Phil., 857; Castro v. Echarri, 20 Phil., 23).

When respondents executed the aforementioned deed of extra-judicial settlement stating therein that
they are the sole heirs of the late Marcelo de Guzman, and secured new transfer certificates of title in
their own name, they thereby excluded the petitioners from the estate of the deceased, and
consequently, set up a title adverse to them. And this is why petitioners have brought this action for the
annulment of said deed upon the ground that the same is tainted with fraud.

Although, there are some decisions to the contrary (Jacinto v. Mendoza, L-12540, February 28, 1959;
Cuison v. Fernandez, L-11764, January 31, 1959; Marabiles v. Quito, L-10408, October 18, 1956 and
Sevilla v. De los Angeles, L-7745, November 18, 1955), 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 (Candelaria vs. Romero, L-12149, September 30,
1960; Alzona v. Capunita, L-10220, February 28, 1962).
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 (Mauricio v. Villanueva, L-11072, September 24, 1959). Such discovery is
deemed to have taken place, in the case at bar, on June 25, 1948, when said instrument was filed with
the Register of Deeds and new certificates of title in the name of the respondents exclusively, for the
registration of the deed of extra-judicial settlement constitutes constructive notice to the whole world
(Diaz v. Gorricho, L-11229, March 29, 1958; Avecilla v. Yatco, L-11578, May 14, 1958; J. M. Tuason &
Co., Inc. v. Magdangal, L-15539, January 30, 1962; Lopez v. Gonzaga, L-18788, January 31, 1964).
(Emphasis supplied.)

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. 5

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, 6shall vest in every
actual occupant or possessor of such land a full and complete title. . . . (Emphasis ours.)

The stringent mandate of said section 41 that "the possession by the claimant or by the person under or
through whom he claims must have been actual, open, public, continuous under a claim of title exclusive of any
other right and adverse to all other claimants," was adjudged by the lower court as having been fulfilled in the
case at hand. And we agree. Although paragraph 13 of the stipulation of facts hereinbefore adverted to does
not explicitly employ the word "adverse" to characterize the possession of the defendants from 1928 up to the
filing of the complaint in 1960, the words, "defendants have been in possession of the land since 1928 up to the
present [1960] publicly and continuously under claim of ownership; they have cultivated it, harvested and
appropriated the fruits for themselves," clearly delineate, and can have no other logical meaning than,
the adverse character of the possession exercised by the appellees over the land. If the import of the
abovequoted portion of the stipulation of facts is at all doubted, such doubt is dispelled completely by additional
cumulative facts in the record which are uncontroverted. Thus, the appellees declared the lot for taxation
purposes in their names, and the resulting tax declaration was later concelled and two tax declarations were
issued in favor of Silbina Fabian and Teodora Fabian, respectively. They have been paying the real estate
taxes thereon from 1929 to the present. And in 1945 they subdivided the lot into two equal parts, and two
transfer certificates of title were issued separately in their names.

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.
1äwphï1.ñët

ACCORDINGLY, the judgment a quo, dismissing the complaint, is affirmed. No pronouncement as to costs.
G.R. No. L-46345 January 30, 1990

RESTITUTO CENIZA and JESUS CENIZA, petitioners,


vs.
THE HON. COURT OF APPEALS, MAGNO DABON, VICENTA DABON, TERESITA DABON, EUGENIA
DABON, and TOMAS DABON, respondents.

Vicente P. Valera and Pedro Rosito & Jesus F. Balicanta for petitioners.
Victorino U. Montecillo for respondents.

GRINO-AQUINO, J.:

This is a petition for review of the order dated October 29, 1976, of the Court of Appeals in CA-G.R. No. 48546
entitled, "Restituto Ceniza, et al. vs. Magno Dabon, et al.," dismissing the petitioners' complaint for
reconveyance of their shares in co-ownership property and reversing the decision of the trial court in their favor.

On June 14, 1967, the petitioners filed against private respondents, an action in the Court of First Instance of
Cebu for recovery of their title to Lots Nos. 627-B and 627-C (being portions of Lot No. 627 with an area of
approximately 5,306 square meters) situated in Casuntingan, Mandaue, Cebu (now Mandaue City), which
originally formed part of "Hacienda de Mandaue" of the Seminario de San Carlos de Cebu. The Property is
covered by reconstituted Original Certificate of Title No. RO-10996 issued on February 8, 1939 (formerly
Decree No. 694438 issued on February 27, 1934) in the name of "Vicente Dabon married to Marcela [or
Marcelina] Ceniza." (pp. 7 and 19, Record on Appeal).

Petitioners are the descendants of Manuel Ceniza while the private respondents are the descendants of his
sister, Sofia Ceniza. Sofia Ceniza was childless but she had an adopted daughter named Flaviana Ceniza, who
begot a daughter named Marced Ceniza and who in turn had a daughter named Marcelina (or Marcela) Ceniza
who married Vicente Dabon. Private respondents are the children of this marriage and they are the great-great-
grandchildren of Sofia Ceniza.

On the other hand, Manuel Ceniza had an only son, Pablo, who had two sons, Santiago and Jose Ceniza.
Petitioners Restituto and Jesus Ceniza and a certain Nemesia Ceniza-Albina are their children and the great-
grandchildren of Manuel Ceniza.

The records disclose that when Hacienda de Mandaue was subdivided for resale to the occupants in 1929,
Jose Ceniza and Vicente Dabon, who were residing in the hacienda, jointly purchased Lot 627 on installment
basis and they agreed, for convenience, to have the land registered in the name of Dabon. Since then, Jose
Ceniza, Vicente Dabon, and their heirs have possessed their respective portions of the land, declared the same
for taxation, paid real estate taxes on their respective shares, and made their respective installment payments
to the Seminario de San Carlos de Cebu.

After Dabon died in 1954, his seven (7) children, named Magno, Jacinta, Tomas, Flaviana, Soledad, Teresita
and Eugenia, succeeded to his possession of a portion of the land.

On November 4, 1961, a private land surveyor, Espiritu Bunagan, on the request of Jacinta Dabon and
Restituto Ceniza who jointly defrayed the cost, divided Lot 627 into three parts, namely:

(1) Lot No. 627-A with 3,538 square meters for Marcela Ceniza;

(2) Lot No. 627-B with 884 square meters for Restituto Ceniza; and
(3) Lot No. 627-C with 834 square meters for Nemesia Ceniza-Albina, who later bequeathed her share
to her brother, Jesus Ceniza. (p. 19, Record on Appeal).

The present controversy arose because the private respondents refused to convey Lots Nos. 627-B and 627-C
to the petitioners. They claimed that their predecessor-in-interest, Vicente Dabon, was the sole and exclusive
owner of Lot 627, by purchase from the Seminario de San Carlos de Cebu. In their answer to the petitioners'
complaint for reconveyance in June 1967, they alleged that the petitioners' right of action had already
prescribed.

Petitioners replied that Vicente Dabon held the land in trust for them, as co-owners, hence, their action for
reconveyance was imprescriptible.

On August 31, 1970, the trial court rendered judgment for the petitioners. Finding that there existed a co-
ownership among the parties, it ordered the private respondents to execute deeds of conveyance of Lots Nos.
627-B and 627-C in favor of the plaintiffs, Restituto and Jesus Ceniza, respectively (p. 35, Record on Appeal).

On appeal by the defendants (now private respondents) the Court of Appeals on October 29, 1976, reversed
that decision of the trial court. It ruled that the petitioners' right of action had prescribed after the lapse of 20
years from the date of registration of the land on February 8, 1939 in Vicente Dabon's name (p. 32, Rollo).

The petitioners have appealed to this Court by a petition for review under Rule 45 of the Rules of Court.

The legal issue presented by the petition is whether the registration of the title of the land in the name of one of
the co-owner, constituted a repudiation of the co-ownership for purposes of acquisitive prescription.

We find merit in the petition for review.

The trial court correctly ruled that since a trust relation and co-ownership were proven to exist between the
predecessors- in-interest of both petitioners and private respondents, prescription did not run in favor of
Dabon's heirs except from the time that they repudiated the co-ownership and made the repudiation known to
the other co-owners, Restituto and Jesus Ceniza (Cortes vs. Oliva, 33 Phil. 480).

Paragraph 5 of Article 494 of the Civil Code provides-

No prescription shall run in favor of a co-owner or co-heir against his co-owners or co-heirs so long as
he expressly or impliedly recognizes the co-ownership.

The registration of Lot No. 627 in the name of Vicente Dabon created a trust in favor of his co-owner Jose
Ceniza, and the latter's heirs. Article 1452 of the Civil Code states:

If two or more persons agree to purchase property and common consent the legal title is taken in the
name of one of them for the benefit of all, a trust is created by force of law in favor of the others in
proportion to the interest of each.

This Court has ruled in numerous cases involving fiduciary relations that, as a general rule, the trustee's
possession is not adverse and therefore cannot ripen into a title by prescription. Adverse possession requires
the concurrence of the following circumstances:

a) that the trustee has performed unequivocal acts of repudiation amounting to the ouster of the cestui
que trust;

b) that such positive acts of repudiation have been made known to the cestui que trust; and

c) that the evidence thereon should be clear and conclusive.


The above elements are not present here for the petitioners/ co-owners have not been ousted from the land.
They continue to possess their respective shares of Lot 627 and they have been paying the realty taxes
thereon. Restituto's house stands on his portion of the Land. Assuming that the private respondents' rejection
of the subdivision plan for the partition of the land was an act of repudiation of the co-ownership, prescription
had not yet set in when the petitioners instituted the present action for reconveyance. These circumstances
were overlooked by the Court of Appeals.

In Custodio v. Casiano 9 SCRA 841, we ruled that:

Where title to land was issued in the name of a co-heir merely with the understanding that he would
act as a trustee of his sisters, and there is no evidence that this trust relation had ever been repudiated
by said trustee, it is held that a reaction of co-ownership existed between such trustee and his sisters
and the right of the successors-in-interest of said sisters to bring the present action for recovery of their
shares therein against the successors-in-interest of said trustee cannot barred by prescription, despite
the, lapse of 25 years from the date of registration of the land in the trustee's name. (Emphasis
supplied.)

In Escobar v. Locsin, 74 Phil. 86, we affirmed the duty of the courts to shield fiduciary relations "against every
manner of chicanery or detestable design cloaked by legal technicalities" and to guard against misuse of the
Torrens system "to foment betrayal in the performance of a trust."

In this case, since the statutory period of limitation within which to file an action for reconveyance, after the
defendants had repudiated the co-ownership in 1961, had not yet run its course when the petitioners filed said
action in 1967, the action was not barred by prescription.

WHEREFORE. the decision of the Court of appeals is hereby REVERSED AND SET ASIDE and the decision
dated August 31, 1970 of the then Court of First Instance of Cebu, Branch VI, in Civil Case No. R-10030 is
reinstated. Costs against the private respondents.
G.R. No. L-51914 June 6, 1990

MARIA BICARME assisted by her husband JOSE BALUBAR, petitioner,


vs.
COURT OF APPEALS and CRISTINA BICARME, respondents.

Paterno Aquiao for petitioner.

Demetrio V. Pre for private respondent.

MEDIALDEA, J.:

This petition seeks to set aside the appealed decision of the lower court 1 as affirmed by the appellate court on August 28, 1979, directing the
amicable partition of two parcels of land between Cristina Bicarme (private respondent) and her aunt Maria Bicarme (petitioner), as well as
the Resolution, dated October 5, 1979, denying petitioner's motion for reconsideration.

The affirmed decision of the lower court, rendered on December 22, 1975, disposes as follows:

(a) That Maria Bicarme and Cristina Bicarme are the only surviving co-heirs and co-owners
and entitled in equal shares over the parcel of land in litigation and described under paragraph
3 of the complaint;

(b) That the alleged deeds of Sale executed by Maria Bicarme covering and affecting the two
parcels of land in suit are declared null and void in so far (sic) as they affect and/or cover the
one-half undivided share and inheritance of plaintiff Cristina Bicarme;

(c) Maria Bicarme is ordered to account and/or pay the value corresponding to the one-half
(½) undivided shares of Cristina Bicarme in the yearly fruits of the land and to commence from
the filing of this complaint; that is seventy five bundles of palay valued at P375.00 with legal
interest fully paid;

(d) That the parties are hereby ordered within (15) days from receipt of this decision to
amicably agree upon a written partition and to submit the same for approval, parties shall
appoint a Commissioner to effect and carry out effectively the partition of the 2 parcels of land
in equal parts between the plaintiff and the defendant;

(e) Defendant and her hirelings and representatives are forever ordered to refrain from
molesting the Commissioner in the discharge of his duty to partition said two (2) parcels of
land in suit;

(f) And, Defendant to pay Attorney's fee and cost of this suit.

SO ORDERED. (pp. 40-41, Record on Appeal)

Petitioner-defendant Maria Bicarme appealed.

The Court of Appeals affirmed the decision; hence, this petition.

The main issue in this case dwells on ownership rights over the litigated parcels of land.

As established by the trial court, Sps. Juan Bicarme and Florencia Bidaya were the original co-owners of two
parcels of land described as follows:
1. Cornland in Palao, Bangued, Abra, bounded on the North-Hill, on the East-Brono Barbers,
on the South-Casimiro Palos, and on the West-Clemente Baldozan, of about 8,721 sq. m.,
assessed at P400.00 under Tax Dee. No. 7764;

2. Riceland in Palao, Bangued, Abra, bounded on the North-Macario Bolos, East- Roberto
Bicarme, South-Juliana Baldozan, and West-Telesporo, about 1,539 sq. m., assessed at P
60.00, under Tax Dec. No. 7765;

.... (P. 10, Record on Appeal)

The spouses died intestate and were survived by three children-Victorina Bicarme, Sebastian Bicarme and
Maria Bicarme. Sebastian Bicarme died when he was a little boy and without any issue. Later, Victorina
Bicarme died intestate, survived by her only daughter, Cristina Bicarme.

Cristina claims that upon the death of her grandparents, Sps. Juan and Florencia, her mother Victorina and her
aunt, Maria, became co-owners or co-heirs of the litigated parcels of land. Upon the death of her mother,
Victorina, Cristina became co-heirs with Maria, having inherited the share and interest of her mother
corresponding to one-half of the two parcels of land.

Cristina instituted this action for partition, because her aunt, Maria, refused to share with her the yearly fruits of
the disputed parcels of land. Maria, however, maintains that "she acquired these two parcels of land in 1925
(cornland) and 1926 (riceland) from the deceased spouses Placido Bidaya and Margarita Bose and since then
until the present, had been in open, public, peaceful, continuous, adverse possession and enjoyment and in the
concept of absolute owner thereof Maria further claims that Cristina, her niece, never shared or contributed to
the payment of taxes of said two parcels of land; and, finally, that Cristina Bicarme was presumed already
dead" (p. 35, Record on Appeal).

In ruling Maria and Cristina to be co-heirs, the trial court relied on a provision separately stated in three deeds
of sale executed by Maria as follows:

That I am the sole and absolute owner over the above described cornland having acquired the
same by inheritance from my late father Juan Bicarme;" (See Exhibits '4', '5', '6', and '7' or
Exhibits 'A-1,' 'B-1,' 'C-1', and 'D-1'; (p. 37, Record on Appeal, emphasis supplied)

The trial court stated that the provision was in the nature of a trust provision in favor of Cristina as a co-
owner/co-heir.

We agree. By admitting that the cornland is inherited property, Maria, in effect, recognized Cristina's lights
thereto as a co-heir/co-owner. As the trial court theorized:

xxx xxx xxx

(6) That Victorina Bicarme and Maria Bicarme never partitioned even orally the two parcels of
lands which were then owned in common by them;

(7) . That even after the death of Victorina Bicarme, the land in suit remained undivided and
were therefore in the possession of Maria Bicarme because her niece Cristina Bicarme went
to Manila and now married and presently residing at No. 22, 11th Avenue, Grace Park,
Caloocan City.

(8) That without the knowledge and consent of Cristina Bicarme who was then of legal age,
her aunt Maria Bicarme executed on April 27, 1973 a Deed of absolute Sale (Exhibit 'A') in
favor of Marina Pizarro who acquired portion No. 3 of the cornland; on the same date she also
executed another Deed of Sale (Exhibit 'B') in favor of Saturnino Pacopia, who acquired
portion No. 2 of the cornland; and, in June 16, 1965 again Maria Bicarme executed a third
Deed of Sale (Exhibit 'C') in favor of Casimira Pacopia, who acquired portion No. 1 of the
cornland;

(9) That these three (3) separated (sic) Deeds of Sale all executed by Maria Bicarme over the
cornland have a respective total area of 740 square meters, more or less, for portion No. 3;
1,836 square meters, more or less for portion No. 2; and 1,265 square meters, more or less
for portion No. 1, or a total area of 3,481 square meters more or less;

(10) That in these three separate Deeds of Sale, Maria Bicarme expressly provided the
aforesaid trust provision. (pp. 36-37, Record on Appeal, emphasis ours)

Despite admission during the hearing on the Identity of the land in question (see p. 21, Record on Appeal),
Maria's counsel, on appeal, re-emphasized her original claim that the two parcels of land in her possession
were acquired from the Sps. Placido Biduya and Margarita Bose. However, the private document relative to the
purchase, was not produced at the trial, allegedly because "they were placed in a trunk in their house which
were burned during the Japanese Occupation." In 1945, Maria sold the riceland. No written evidence was
submitted. For all legal intents therefore, the riceland remained inherited property. The Identity of the cornland
as inherited property can no longer be disputed, in view of Maria's admission in the deeds of sale she had
executed, containing the trust provisions.

Having established Cristina's co-ownership rights, Maria nonetheless insists that Cristina's rights are barred by
prescription under Secs. 40 and 41 of Act 190 (Code of Civil Procedure, Article 1116, Civil Code) then the
applicable law, where the longest period of both acquisitive and extinctive prescription was only ten years (Diaz
v. Garricho, 103 Phil. 261, 266). In the present case, Cristina, it is alleged, asserted her claims 34 years after
her right of action accrued, as follows:

... After Cristina left barrio Palao at the age of eleven (11), she never returned until she was
twenty two (22) years old and married (pp. 32-34, tsn., Nov. 4, 1974). Upon her return her
grandmother Florencia Bidaya was already dead (p. 33, Id). At that time, Cristina claimed her
hereditary share in the lands in question but her demands were ignored and repudiated by her
aunt Maria, Cristina admitted that ever since the Japanese occupation when she was already
of age, her aunt Maria refused to recognize her rights to said lands (pp. 41-42, Id.). From that
moment when Maria ignored and repudiated Cristina's hereditary rights, Cristina's right of
action already accrued and the period of prescription began to run.

The instant action was filed only in 1974 (p. 1, Record on Appeal), or some 34 years after it
accrued. If she had any rights at all, Cristina slept on her rights. The present action is
unquestionably barred by prescription. (pp. 27-28, Appellants' Brief)

Against Maria's claims of acquisitive prescription, the lower court ruled that Maria was as trustee with respect to
Cristina's share. As such, prescription, as a mode of acquiring title, could not apply:

A co-owner is a trustee for the other co-owner. No one of the co-owners may acquire
exclusive ownership of the common property thru prescription for possession by one trustee
alone is not deemed adverse to the rest (Castrillo vs. Court of Appeals, 10 SCRA 549;
Custodio vs. Casiano, 9 SCRA 841 and, Pascual vs. Meneses, 20 SCRA 219). (p. 6, Rollo)

While We agree with the trial court that Maria and Cristina are co-heirs, and that with respect to them
prescription, as a mode of acquisition, cannot apply, We hasten to elaborate on certain aspects, which need
clarification.

It is correct to say that possession by one co-owner (trustee) is not deemed adverse to the others. In this
sense, an action to compel partition will lie at any time and does not prescribe. It is, however, not legally correct
to say that by virtue of the imprescriptibility of an action for partition, prescription as a mode of acquiring title,
can never be invoked, or in the present case, that Maria, as a co-owner can never acquire the property by
prescription.
An action for partition implies that the thing is still owned in common. If a co-owner or co-heir holds the property
in exclusive adverse possession as owner, asserting sole and exclusive dominion for the required period, he
can acquire sole title to it as against the co-heirs or co-owners. The imprescriptibility of an action for partition
cannot thus be invoked when one of the co-owners has possessed the property as exclusive owner, and for a
period sufficient to acquire it by prescription. From the moment one of the co-owners claims that he is the
absolute and exclusive owner of the properties and denies the others any share therein, the question involved
is no longer one of partition, but of ownership. (A. Tolentino, Civil Code of the Phil., Ann., Vol. II, pp. 192-193;
Bargayo v. Comumot, 40 Phil. 856, at p. 870). In this sense, the trial court erred in saying that there can be no
prescription (as a mode of acquiring title) in favor of a co-owner/trustee.

Having clarified this issue, the main question to be resolved is whether or not Maria has been in possession of
the lands in question under the conditions required by Section 41 of the Code of Civil Procedure, as to uphold
acquisitive prescription in her favor.

One of the conditions imposed by said section is that the possession must be adverse against the whole world.
In order that a possession may be deemed adverse to the cestui que trust, or the other co-owner the following
must concur:

... (1) that he has performed unequivocal acts of repudiation amounting to an ouster of the
cestui que trust or other co-owner, (2) that such positive acts of repudiation have been made
known to the cestui que trust or other co-owners, and (3) that the evidence thereon must be
clear and convincing. (A. Tolentino, Civil Code of the Phils., Ann., Vol. 11, p. 193)

In the present case, Maria Bicarme disclaims the co-ownership by denying that subject properties are the
inherited properties. Other than the tax declarations in her name, there is no written evidence that these were
acquired/purchased from Sps. Placido Biduya and Margarita Bose. Payment of land taxes does not constitute
sufficient repudiation of the co-ownership, as it is not an act adverse to Cristina's rights. Moreover, Cristina,
being a minor, until she claimed her rights, was not even aware thereof. Neither did Maria make known her
repudiation to Cristina, because all along, Maria presumed her to be dead. Her refusal to share with Cristina
the yearly profits stemmed from Cristina's failure to share in the yearly taxes. Acquisitive prescription cannot
therefore apply in this case:

Acts which are adverse to strangers may not be sufficiently adverse to the co- owners. A mere
silent possession by a co-owner, his receipt of rents, fruits or profits from the property, the
erection of buildings and fences and the planting of trees thereon, and the payment of land
taxes, cannot serve as proof of exclusive ownership, if it is not borne out by clear, complete
and conclusive evidence that he exercised acts of possession which unequivocally constituted
an ouster or deprivation of the rights of the other co-owners. (Mangyan v. Ilan, 28 O.G. 62;
Laguna v. Levantino, 40 O.G. (14th Suppl.) 136, cited in A. Tolentino, Civil Code of the
Philippines, Ann., Vol. II, pp. 193- 194)

Additionally, it follows that neither can the doctrine on laches apply, for absent acquisitive prescription, (i.e.,
where it has not been shown that the possession of the claimant has been adverse and exclusive and opposed
to the right of the others) the case is not one of ownership, in which case, the doctrine on imprescriptibility of an
action for partition will apply. Cristina's right to partition wig therefore prosper.

Finally, We eliminate the award on attorney's fees in the absence of any specific allegation thereon in her
complaint, or that the same is covered by any of the eleven (11) exceptions enumerated in Art. 2208 of the
New Civil Code. Even if We were to concede exercise of judicial discretion in the award of attorney's fees
under Art. 2208, par. 11, this provision "demands a factual, legal or equitable justification. Without such
justification, the award is a conclusion without a premise, its basis being improperly left to speculation and
conjecture." (Mirasol v. De la Cruz, G.R. L-32552, July 31, 1978; 84 SCRA 337.) Likewise, "the matter of
attorney's fees cannot be touched once and only in the dispositive portion of the decision. The text itself must
expressly state the reason why attorney's fees are being awarded" (ibid). In the present case, the matter of
such fees was touched but once and appears only in the dispositive portion of the decision.
ACCORDINGLY, the petition for review is DENIED and the appealed decision as affirmed by the Court of
Appeals is hereby AFFIRMED with the modification that the award on attorney's fees is eliminated. Costs
against petitioner. This decision is immediately executory.
G.R. No. L-46296 September 24, 1991

EPITACIO DELIMA, PACLANO DELIMA, FIDEL DELIMA, VIRGILIO DELIMA, GALILEO DELIMA, JR.,
BIBIANO BACUS, OLIMPIO BACUS and PURIFICACION BACUS, petitioners,
vs.
HON. COURT OF APPEALS, GALILEO DELIMA (deceased), substituted by his legal heirs, namely:
FLAVIANA VDA. DE DELIMA, LILY D. ARIAS, HELEN NIADAS, ANTONIO DELIMA, DIONISIO DELIMA,
IRENEA DELIMA, ESTER DELIMA AND FELY DELIMA, respondents.

Gabriel J. Canete for petitioners.


Emilio Lumontad, Jr. for private respondents.

MEDIALDEA, J.:

This is a petition for review on certiorari of the decision of the Court of Appeals reversing the trial court's
judgment which declared as null and void the certificate of title in the name of respondents' predecessor and
which ordered the partition of the disputed lot among the parties as co-owners.

The antecedent facts of the case as found both by the respondent appellate court and by the trial court are as
follows:

During his lifetime, Lino Delima acquired Lot No. 7758 of the Talisay-Minglanilla Friar Lands Estate in Cebu by
sale on installments from the government. Lino Delima later died in 1921 leaving as his only heirs three
brothers and a sister namely: Eulalio Delima, Juanita Delima, Galileo Delima and Vicente Delima. After his
death, TCT No. 2744 of the property in question was issued on August 3, 1953 in the name of the Legal Heirs
of Lino Delima, deceased, represented by Galileo Delima.

On September 22, 1953, Galileo Delima, now substituted by respondents, executed an affidavit of "Extra-
judicial Declaration of Heirs." Based on this affidavit, TCT No. 2744 was cancelled and TCT No. 3009 was
issued on February 4,1954 in the name of Galileo Delima alone to the exclusion of the other heirs.

Galileo Delima declared the lot in his name for taxation purposes and paid the taxes thereon from 1954 to
1965.

On February 29, 1968, petitioners, who are the surviving heirs of Eulalio and Juanita Delima, filed with the
Court of First Instance of Cebu (now Regional Trial Court) an action for reconveyance and/or partition of
property and for the annulment of TCT No. 3009 with damages against their uncles Galileo Delima and Vicente
Delima,. Vicente Delima was joined as party defendant by the petitioners for his refusal to join the latter in their
action.

On January 16, 1970, the trial court rendered a decision in favor of petitioners, the dispositive portion of which
states:

IN VIEW OF THE FOREGOING CONSIDERATIONS, the following are the declared owners of Lot No.
7758 of the Talisay-Minglanilla Friar Lands Estate presently covered by transfer Certificate of Title No.
3009, each sharing a pro-indiviso share of one-fourth;

1) Vicente Delima (one-fourth)

2) Heirs of Juanita Delima, namely: Bibiano Bacus, Olimpio Bacus and Purificacion Bacus (on-fourth);
3) Heirs of Eulalio Delima, namely Epitacio, Pagano, Fidel, Virgilio and Galileo Jr., all surnamed
Delima (one-fourth); and

4) The Heirs of Galileo Delima, namely Flaviana Vda. de Delima, Lily D. Arias, Helen Niadas and
Dionisio, Antonio, Eotu Irenea, and Fely, all surnamed Delima (one-fourth).

Transfer Certificate of Title No. 3009 is declared null and void and the Register of Deeds of Cebu is
ordered to cancel the same and issue in lieu thereof another title with the above heirs as pro-indiviso
owners.

After the payment of taxes paid by Galileo Delima since 1958, the heirs of Galileo Delima are ordered
to turn a over to the other heirs their respective shares of the fruits of the lot in question computed at
P170.00 per year up to the present time with legal (interest).

Within sixty (60) days from receipt of this decision the parties are ordered to petition the lot in question
and the defendants are directed to immediately turn over possession of the shares here awarded to
the respective heirs.

Defendants are condemned to pay the costs of the suit.

The counterclaim is dismissed.

SO ORDERED. (pp. 54-55, Rollo)

Not satisfied with the decision, respondents appealed to the Court of Appeals. On May 19, 1977, respondent
appellate court reversed the trial court's decision and upheld the claim of Galileo Delima that all the other
brothers and sister of Lino Delima, namely Eulalio, Juanita and Vicente, had already relinquished and waived
their rights to the property in his favor, considering that he (Galileo Delima) alone paid the remaining balance of
the purchase price of the lot and the realty taxes thereon (p. 26, Rollo).

Hence, this petition was filed with the petitioners alleging that the Court of Appeals erred:

1) In not holding that the right of a co-heir to demand partition of inheritance is imprescriptible. If it
does, the defenses of prescription and laches have already been waived.

2) In disregarding the evidence of the petitioners.(p.13, Rollo)

The issue to be resolved in the instant case is whether or not petitioners' action for partition is already barred
by the statutory period provided by law which shall enable Galileo Delima to perfect his claim of ownership by
acquisitive prescription to the exclusion of petitioners from their shares in the disputed property. Article 494 of
the Civil Code expressly provides:

Art. 494. No co-owner shall be obliged to remain in the co-ownership. Each co-owner may demand at
any time the partition of the thing owned in common, insofar as his share is concerned.

Nevertheless, an agreement to keep the thing undivided for a certain period of time, not exceeding ten
years, shall be valid. This term may be extended by a new agreement.

A donor or testator may prohibit partition for a period which shall not exceed twenty years.

Neither shall there be any partition when it is prohibited by law.

No prescription shall run in favor of a co-owner or co-heir against his co-owners or co-heirs so long as
he expressly or impliedly recognizes the co-ownership.
As a rule, possession by a co-owner will not be presumed to be adverse to the others, but will be held to benefit
all. It is understood that the co-owner or co-heir who is in possession of an inheritance pro-indiviso for himself
and in representation of his co-owners or co-heirs, if, as such owner, he administers or takes care of the rest
thereof with the obligation of delivering it to his co-owners or co-heirs, is under the same situation as a
depository, a lessee or a trustee (Bargayo v. Camumot, 40 Phil, 857; Segura v. Segura, No. L-29320,
September 19, 1988, 165 SCRA 368). Thus, an action to compel partition may be filed at any time by any of
the co-owners against the actual possessor. In other words, no prescription shall run in favor of a co-owner
against his co-owners or co-heirs so long as he expressly or impliedly recognizes the co-ownership (Del Blanco
v. Intermediate Appellate Court, No. 72694, December 1, 1987, 156 SCRA 55).

However, from the moment one of the co-owners claims that he is the absolute and exclusive owner of the
properties and denies the others any share therein, the question involved is no longer one of partition but of
ownership (De Castro v. Echarri, 20 Phil. 23; Bargayo v. Camumot, supra; De los Santos v. Santa Teresa, 44
Phil. 811). In such case, the imprescriptibility of the action for partition can no longer be invoked or applied
when one of the co-owners has adversely possessed the property as exclusive owner for a period sufficient to
vest ownership by prescription.

It is settled that possession by a co-owner or co-heir is that of a trustee. In order that such possession is
considered adverse to the cestui que trust amounting to a repudiation of the co-ownership, the following
elements must concur: 1) that the trustee has performed unequivocal acts amounting to an ouster of the cestui
que trust; 2) that such positive acts of repudiation had been made known to the cestui que trust; and 3) that the
evidence thereon should be clear and conclusive (Valdez v. Olorga, No. L-22571, May 25, 1973, 51 SCRA 71;
Pangan v. Court of Appeals, No. L-39299, October 18, 1988, 166 SCRA 375).

We have held that when a co-owner of the property in question executed a deed of partition and on the
strength thereof obtained the cancellation of the title in the name of their predecessor and the issuance of a
new one wherein he appears as the new owner of the property, thereby in effect denying or repudiating the
ownership of the other co-owners over their shares, the statute of limitations started to run for the purposes of
the action instituted by the latter seeking a declaration of the existence of the co-ownership and of their rights
thereunder (Castillo v. Court of Appeals, No. L-18046, March 31, 1964, 10 SCRA 549). Since an action for
reconveyance of land based on implied or constructive trust prescribes after ten (10) years, it is from the date
of the issuance of such title that the effective assertion of adverse title for purposes of the statute of limitations
is counted (Jaramil v. Court of Appeals, No. L-31858, August 31, 1977, 78 SCRA 420).

Evidence shows that TCT No. 2744 in the name of the legal heirs of Lino Delima, represented by Galileo
Delima, was cancelled by virtue of an affidavit executed by Galileo Delima and that on February 4, 1954,
Galileo Delima obtained the issuance of a new title in Ms name numbered TCT No. 3009 to the exclusion of his
co-heirs. The issuance of this new title constituted an open and clear repudiation of the trust or co-ownership,
and the lapse of ten (10) years of adverse possession by Galileo Delima from February 4, 1954 was sufficient
to vest title in him by prescription. As the certificate of title was notice to the whole world of his exclusive title to
the land, such rejection was binding on the other heirs and started as against them the period of prescription.
Hence, when petitioners filed their action for reconveyance and/or to compel partition on February 29, 1968,
such action was already barred by prescription. Whatever claims the other co-heirs could have validly asserted
before can no longer be invoked by them at this time.

ACCORDINGLY, the petition is hereby DENIED and the assailed decision of the Court of Appeals dated May
19, 1977 is AFFIRMED.
G.R. No. 118904 April 20, 1998

ARTURIO TRINIDAD, petitioner,


vs.
COURT OF APPEALS, FELIX TRINIDAD (deceased) and LOURDES TRINIDAD, respondents.

PANGANIBAN, J.:

In the absence of a marriage contract and a birth certificate, how may marriage and filiation be proven?

The Case

This is the main question raised in this petition for review on certiorari challenging the Court of
Appeals 1 Decision promulgated December 1, 19942 and Resolution promulgated on February 8, 19953 in CA-
GR CV No. 23275, which reversed the decision of the trial court and dismissed petitioner's action for partition
and damages.

On August 10, 1975, Petitioner Arturio Trinidad filed a complaint 4 for partition and damages against Private
Respondents Felix and Lourdes, both surnamed Trinidad, before the Court of First Instance of Aklan, Branch
I. 5 On October 25, 1982, Felix died without issue, so he was not substituted as a party. 6

On July 4, 1989, the trial court rendered a twenty-page decision 7 in favor of the petitioner, in which it ruled:8

Considering therefore that this court is of the opinion that plaintiff is the legitimate son of
Inocentes Trinidad, plaintiff is entitled to inherit the property left by his deceased father which
is 1/3 of the 4 parcels of land subject matter of this case. Although the plaintiff had testified
that he had been receiving [his] share from said land before and the same was stopped, there
was no evidence introduced as to what year he stopped receiving his share and for how
much. This court therefore cannot rule on that.

In its four-page Decision, Respondent Court reversed the trial court on the ground that petitioner failed to
adduce sufficient evidence to prove that his parents were legally married to each other and that acquisitive
prescription against him had set in. The assailed Decision disposed:9

WHEREFORE, the Court REVERSES the appealed decision.

In lieu thereof, the Court hereby DISMISSES the [petitioner's] complaint and the counterclaim
thereto.

Without costs.

Respondent Court denied reconsideration in its impugned Resolution which reads: 10

The Court DENIES defendants-appellants' motion for reconsideration, dated December 15,
1994, for lack of merit. There are no new or substantial matters raised in the motion that merit
the modification of the decision.

Hence, this petition. 11

The Facts
The assailed Decision recites the factual background of this case, as follows: 12

On August 10, 1978, plaintiff [herein petitioner] filed with the Court of First Instance of Aklan,
Kalibo, Aklan, an action for partition of four (4) parcels of land, described therein, claiming that
he was the son of the late Inocentes Trinidad, one of three (3) children of Patricio Trinidad,
who was the original owner of the parcels of land. Patricio Trinidad died in 1940, leaving the
four (4) parcels of land to his three (3) children, Inocentes, Lourdes and Felix. In 1970, plaintiff
demanded from the defendants to partition the land into three (3) equal shares and to give
him the one-third (1/3) individual share of his late father, but the defendants refused.

In their answer, filed on September 07, 1978, defendants denied that plaintiff was the son of
the late Inocentes Trinidad. Defendants contended that Inocentes was single when he died in
1941 , before plaintiff's birth. Defendants also denied that plaintiff had lived with them, and
claimed that the parcels of land described in the complaint had been in their possession since
the death of their father in 1940 and that they had not given plaintiff a share in the produce of
the land.

Patricio Trinidad and Anastacia Briones were the parents of three (3) children, namely,
Inocentes, Lourdes and Felix. When Patricio died in 1940, survived by the above named
children, he left four (4) parcels of land, all situated at Barrio Tigayon, Kalibo Aklan.

Arturio Trinidad, born on July 21, 1943, claimed to be the legitimate son of the late Inocentes
Trinidad.

Arturio got married in 1966 to Candelaria Gaspar, at the age of twenty three (23). Sometime
after the marriage, Arturio demanded from the defendants that the above-mentioned parcels
of land be partitioned into three (3) equal shares and that he be given the one-third (1/3)
individual shares of his late father, but defendants refused.

In order to appreciate more clearly the evidence adduced by both parties, this Court hereby reproduces
pertinent portions of the trial court's decision: 13

EVIDENCE FOR THE PLAINTIFF:

Plaintiff presented as his first witness, Jovita Gerardo, 77 years old, (at the time she testified
in 1981) who is the barangay captain of barrio Tigayon, Kalibo, Aklan, since 1972. She
testified that before being elected as barrio captain she held the position of barrio council-
woman for 4 years. Also she was [a member of the] board of director[s] of the Parent-
Teachers Association of Tigayon, Kalibo, Aklan. That she knows the plaintiff because they are
neighbors and she knows him from the time of his birth. She knows the father of the plaintiff
as Inocentes Trinidad and his mother Felicidad Molato; both were already dead, Inocentes
having died in 1944 and his wife died very much later. Witness recalls plaintiff was born in
1943 in Barrio Tigayon, Kalibo, Aklan, on July 21, 1943. At the time of the birth of the plaintiff,
the house of the witness was about 30 meters away from plaintiff's parents['] house and she
used to go there 2 or 3 times a week. That she knows both the defendants as they are also
neighbors. That both Felix and Lourdes Trinidad are the uncle and aunt of Arturio because
Inocentes Trinidad who is the father of the plaintiff is the brother of the defendants, Felix and
Lourdes Trinidad. She testified she also knows that the father of Inocentes, Felix and
Lourdes[,] all surnamed Trinidad[,] was Patricio Trinidad who is already dead but left several
parcels of land which are the 4 parcels subject of this litigation. That she knows all these
[parcels of] land because they are located in Barrio Tigayon.

When asked about the adjoining owners or boundaries of the 4 parcels of land, witness
answered and mentioned the respective adjoining owners. That she knew these 4 parcels
belonged to Patricio Trinidad because said Patricio Trinidad was a native also of Barrio
Tigayon. Said Patricio died before the [war] and after his death the land went to his 3 children,
namely: Inocentes, Felix and Lourdes. Since then the land was never partitioned or divided
among the 3 children of Patricio.

A picture, Exhibit A, was shown to the witness for identification and she identified a woman in
the picture as the defendant, Lourdes Trinidad. A man with a hat holding a baby was identified
by her as Felix Trinidad, the defendant. The other woman in the picture was pointed by the
witness as the wife of the plaintiff, Arturio Trinidad. When asked if Arturio Trinidad and
Lourdes Trinidad and Felix Trinidad pointed to by her in the picture are the same Arturio, Felix
and Lourdes, who are the plaintiff and the defendants in this case, witness answered yes.

Another picture marked as Exhibit B was presented to the witness for identification. She
testified the woman in this picture as Lourdes Trinidad. In said picture, Lourdes Trinidad was
holding a child which witness identified as the child Arturio Trinidad. When asked by the court
when . . . the picture [was] taken, counsel for the plaintiff answered, in 1966. When asked if
Arturio Trinidad was baptized, witness answered yes, as she had gone to the house of his
parents. Witness then identified the certificate of baptism marked as Exhibit C. The name
Arturio Trinidad was marked as Exhibit C-1 and the name of Inocentes Trinidad and Felicidad
Molato as father and mother respectively, were marked as Exhibit C-2. The date of birth being
July 21, 1943 was also marked. The signature of Monsignor Iturralde was also identified.

On cross-examination, witness testified that she [knew] the land in question very well as she
used to pass by it always. It was located just near her house but she cannot exactly tell the
area as she merely passes by it. When asked if she [knew] the photographer who took the
pictures presented as Exhibit A and B, witness answered she does not know as she was not
present during the picture taking. However, she can identify everybody in the picture as she
knows all of them.

At this stage of the trial, Felix Trinidad [died] without issue and he was survived by his only
sister, Lourdes Trinidad, who is his co-defendant in this case.

Next witness for the plaintiff was ISABEL MEREN who was 72 years old and a widow. She
testified having known Inocentes Trinidad as the father of Arturio Trinidad and that Inocentes,
Felix and Lourdes are brothers and sister and that their father was Patricio Trinidad who left
them 4 parcels of land. That she knew Inocentes Trinidad and Felicidad Molato who are the
parents of Arturio, the plaintiff, were married in New Washington, Aklan, by a protestant pastor
by the name of Lauriano Lajaylajay. That she knows Felicidad Molato and Lourdes Trinidad
very well because as a farmer she also owns a parcel of land [and] she used to invite
Felicidad and Lourdes to help her during planting and harvesting season. That she knows that
during the lifetime of Inocentes the three of them, Inocentes, Felix and Lourdes possessed
and usufructed the 4 parcels they inherited from their father, Patricio. That upon the death of
Inocentes, Lourdes Trinidad was in possession of the property without giving the widow of
Inocentes any share of the produce. As Lourdes outlived her two brothers, namely: Felix and
Inocentes, she was the one possessing and usufructing the 4 parcels of land up to the
present. The witness testified that upon the death of Inocentes, Lourdes took Arturio and
cared for him when he was still small, about 3 years old, until Arturio grew up and got married.
That while Arturio was growing up, he had also enjoyed the produce of the land while he was
being taken care of by Lourdes Trinidad. That a misunderstanding later on arose when Arturio
Trinidad wanted to get his father's share but Lourdes Trinidad will not give it to him.

Plaintiff, ARTURIO TRINIDAD, himself, was presented as witness. He testified that


defendants, Lourdes and Felix Trinidad, are his aunt and uncle, they being the brother and
sister of his father. That the parents of his father and the defendants were Patricio Trinidad
and Anastacia Briones. That both his father, Inocentes Trinidad, and mother, Felicidad
Molato, were already dead having died in Tigayon, his father having died in 1944 and his
mother about 25 years ago.
As proof that he is the son of Inocentes Trinidad and Felicidad Molato, he showed a certificate
of baptism which had been previously marked as Exhibit C. That his birth certificate was
burned during World War 2 hut he has a certificate of loss issued by the Civil Registrar of
Kalibo, Aklan.

When he was 14 years old, the defendants invited him to live with them being their nephew as
his mother was already dead. Plaintiff's mother died when he was 13 years old. They treated
him well and provided for all his needs. He lived with defendants for 5 years. At the age of 19,
he left the house of the defendants and lived on his own. He got married at 23 to Candelaria
Gaspar and then they were invited by the defendants to live with them. So he and his wife and
children lived with the defendants. As proof that he and his family lived with the defendants
when the latter invited him to live with them, he presented a picture previously marked as
Exhibit B where there appears his aunt, Lourdes Trinidad, carrying plaintiff's daughter, his
uncle and his wife. In short, it is a family picture according to him. Another family picture
previously marked Exhibit A shows his uncle, defendant Felix Trinidad, carrying plaintiff's son.
According to him, these 2 pictures were taken when he and his wife and children were living
with the defendants. That a few years after having lived with them, the defendants made them
vacate the house for he requested for partition of the land to get his share. He moved out and
looked for [a] lawyer to handle his case. He testified there are 4 parcels of land in controversy
of which parcel 1 is an upland.

Parcel 1 is 1,000 square meters, [has] 10 coconut trees and fruit bearing. The harvest is 100
coconuts every 4 months and the cost of coconuts is P2.00 each. The boundaries are: East-
Federico Inocencio; West-Teodulo Dionesio; North-Teodulo Dionesio; and South-Bulalio
Briones; located at Tigayon.

Parcel 2 is an upland with an area of 500 square meters; it has only 1 coconut tree and 1
bamboo groove; also located in Tigayon, Kalibo, Aklan. Adjoining owners are: East-Ambrosio
Trinidad; North-Federico Inocencio, West-Patricio Trinidad and South-Gregorio Briones.

Parcel 3 is about 12,000 square meters and 1/4 of that belongs to Patricio Trinidad, the
deceased father of the defendants and Inocentes, the father of the plaintiff.

Parcel 4 is a riceland with an area of 5,000 square meters. The harvest is 40 cavans two
times a years [sic]. Adjoining owners are: East-Gregorio Briones; West-Bulalio Briones; South-
Federico Inocencio and North-Digna Carpio.

Parcel 1 is Lot No. 903.

Parcel 2 is Lot No. 864 of the cadastral survey of Kalibo and only Lot 864-A with an area of
540 square meters is the subject of litigation.

Parcel 3 is Lot No. 979 of the cadastral survey of Kalibo covered by Tax Decl. No. 703310
with reference to one of the owners of the land, Patricio Trinidad married to Anastacia
Briones, one-half share.

Parcel 4 is covered by Original Certificate of Title No. 22502 RO-174 covering Lot No. 863 of
the cadastral survey of Kalibo. The title is in the name of Patricio Trinidad married to
Anastacia Briones.

Parcel 1 is covered by Tax Decl. No. 11609 in the name of Patricio Trinidad while parcel 2 is
covered by Tax Decl. No. 10626 in the name of Anastacia Briones and another Tax
Declaration No. 11637 for Parcel 3 in the name of Ambrosio Trinidad while Parcel 4 is
covered by Tax Decl. No. 16378 in the name of Patricio Trinidad.
On cross-examination, plaintiff testified that during the lifetime of his mother they were getting
the share in the produce of the land like coconuts, palay and corn. Plaintiff further testified that
his father is Inocentes Trinidad and his mother was Felicidad Molato. They were married in
New Washington, Aklan, by a certain Atty. Lajaylajay. When asked if this Atty. Lajaylajay is a
municipal judge of New Washington, Aklan, plaintiff answered he does not know because he
was not yet born at that time. That he does not have the death certificate of his father who
died in 1944 because it was wartime. That after the death of his father, he lived with his
mother and when his mother died[,] he lived with his aunt and uncle, the defendants in this
case. That during the lifetime of his mother, it was his mother receiving the share of the
produce of the land. That both defendants, namely Lourdes and Felix Trinidad, are single and
they have no other nephews and nieces. That [petitioner's] highest educational attainment is
Grade 3.

EVIDENCE FOR THE DEFENDANTS:

First witness for the defendants was PEDRO BRIONES, 68 years old, unemployed and a
resident of Nalook, Kalibo, Aklan. He testified having known the defendants, Felix and
Lourdes Trinidad. They being his first cousins because the mother of Lourdes and Felix by the
name of Anastacia Briones and his father are sister and brother. That he also knew Inocentes
Trinidad being the brother of Felix and Lourdes and he is already dead. According to the
witness, Inocentes Trinidad [died] in 1940 and at the time of his death Inocentes Trinidad was
not married. That he knew this fact because at the time of the death of Inocentes Trinidad he
was then residing with his aunt, "Nanay Taya", referring to Anastacia Briones who is mother of
the defendants, Felix and Lourdes Trinidad, as well as Inocentes Trinidad. That at the time of
the death of Inocentes Trinidad, according to this witness he stayed with his aunt, Anastacia
Trinidad, and with his children before 1940 for only 3 months. When asked if he knew
Inocentes Trinidad cohabited with anybody before his death, he answered, "That I do not
know", neither does he kn[o]w a person by the name of Felicidad Molato. Furthermore, when
asked if he can recall if during the lifetime of Inocentes Trinidad witness knew of anybody with
whom said Inocentes Trinidad had lived as husband and wife, witness, Pedro Briones,
answered that he could not recall because he was then in Manila working. That after the war,
he had gone back to the house of his aunt, Anastacia, at Tigayon, Kalibo, as he always visit[s]
her every Sunday, however, he does not know the plaintiff, Arturio Trinidad. When asked if
after the death of Inocentes Trinidad, he knew anybody who has stayed with the defendants
who claimed to be a son of Inocentes Trinidad, witness, Pedro Briones, answered: "I do not
know about that."

On cross examination, witness testified that although he was born in Tigayon, Kalibo, Aklan,
he stated to reside in Nalook, Kalibo, as the hereditary property of their father was located
there. When asked if he was aware of the 4 parcels of land which is the subject matter of this
case before the court, witness answered that he does not know. What he knew is that among
the 3 children of Patricio Trinidad, Inocentes is the eldest. And that at the time of the death of
Inocentes in 1940, according to the witness when cross examined, Inocentes Trinidad was
around 65 years old. That according to him, his aunt, Anastacia Briones, was already dead
before the war. When asked on cross examination if he knew where Inocentes Trinidad was
buried when he died in 1940, witness answered that he was buried in their own land because
the Japanese forces were roaming around the place. When confronted with Exhibit A which is
the alleged family picture of the plaintiff and the defendants, witness was able to identify the
lady in the picture, which had been marked as Exhibit A-1, as Lourdes Trinidad, and the man
wearing a hat on the said picture marked as Exhibit 2-A is Felix Trinidad. However, when
asked if he knew the plaintiff, Arturio Trinidad, he said he does not know him.

Next witness for the defendants was the defendant herself, LOURDES TRINIDAD. She stated
that she is 75 years old, single and jobless. She testified that Inocentes Trinidad was her
brother and he is already dead and he died in 1941 in Tigayon, Kalibo, Aklan. That before the
death of her brother, Inocentes Trinidad, he had gone to Manila where he stayed for a long
time and returned to Tigayon in 1941. According to her, upon arrival from Manila in 1941 his
brother, Inocentes Trinidad, lived only for 15 days before he died. While his brother was in
Manila, witness testified she was not aware that he had married anybody. Likewise, when he
arrived in Tigayon in 1941, he also did [not] get married. When asked if she knew one by the
name of Felicidad Molato, witness answered she knew her because Felicidad Molato was
staying in Tigayon. However, according to her[,] she does not kn[o]w if her brother, Inocentes
Trinidad, had lived with Felicidad Molato as husband and wife. When asked if she knew the
plaintiff, Arturio Trinidad, she said, "Yes," but she denied that Arturio Trinidad had lived with
them. According to the witness, Arturio Trinidad did not live with the defendants but he stayed
with his grandmother by the name of Maria Concepcion, his mother, Felicidad Molato, having
died already. When asked by the court if there had been an instance when the plaintiff had
lived with her even for days, witness answered, he did not. When further asked if Arturio
Trinidad went to visit her in her house, witness also said, "He did not."

Upon cross examination by counsel for the plaintiff, Lourdes Trinidad testified that her
parents, Anastacia Briones and Patricio Trinidad, had 3 children, namely: Inocentes Trinidad,
Felix Trinidad and herself. But inasmuch as Felix and Inocentes are already dead, she is the
only remaining daughter of the spouses Patricio Trinidad and Anastacia Briones. Defendant,
Lourdes Trinidad, testified that her brother, Felix Trinidad, died without a wife and children, in
the same manner that her brother, Inocentes Trinidad, died without a wife and children. She
herself testified that she does not have any family of her own for she has [no] husband or
children. According to her[,] when Inocentes Trinidad [died] in 1941, they buried him in their
private lot in Tigayon because nobody will carry his coffin as it was wartime and the
municipality of Kalibo was occupied by the Japanese forces. When further cross-examined
that I[t] could not be true that Inocentes Trinidad died in March 1941 because the war broke
out in December 1941 and March 1941 was still peace time, the witness could not answer the
question. When she was presented with Exhibit A which is the alleged family picture wherein
she was holding was [sic] the child of Arturio Trinidad, she answered; "Yes." and the child that
she is holding is Clarita Trinidad, child of Arturio Trinidad. According to her, she was only
requested to hold this child to be brought to the church because she will be baptized and that
the baptism took place in the parish church of Kalibo. When asked if there was a party, she
answered; "Maybe there was." When confronted with Exhibit A-1 which is herself in the picture
carrying the child, witness identified herself and explained that she was requested to bring the
child to the church and that the picture taken together with her brother and Arturio Trinidad
and the latter's child was taken during the time when she and Arturio Trinidad did not have a
case in court yet. She likewise identified the man with a hat holding a child marked as Exhibit
A-2 as her brother, Felix. When asked if the child being carried by her brother, Felix Trinidad,
is another child of the plaintiff, witness answered she does not know because her eyes are
already blurred. Furthermore, when asked to identify the woman in the picture who was at the
right of the child held by her brother, Felix, and who was previously identified by plaintiff,
Arturio Trinidad, as his wife, witness answered that she cannot identify because she had a
poor eyesight neither can she identify plaintiff, Arturio Trinidad, holding another child in the
picture for the same reason. When asked by counsel for the plaintiff if she knows that the one
who took this picture was the son of Ambrosio Trinidad by the name of Julito Trinidad who
was also their cousin, witness testified that she does not know.

Third witness for the defendants was BEATRIZ TRINIDAD SAYON who testified that she
knew Arturio Trinidad because he was her neighbor in Tigayon. In the same manner that she
also knew the defendants, Felix and Lourdes, and Inocentes all surnamed Trinidad because
they were her cousins. She testified that a few months after the war broke out Inocentes
Trinidad died in their lola's house whose names was Eugenia Rufo Trinidad. She further
testified that Inocentes Trinidad had lived almost in his lifetime in Manila and he went home
only when his father fetched him in Manila because he was already sick. That according to
her, about 1 1/2 months after his arrival from Manila, Inocentes Trinidad died. She also
testified that she knew Felicidad Molato and that Felicidad Molato had never been married to
Inocentes Trinidad. According to her, it was in 1941 when Inocentes Trinidad died. According
to her she was horn in 1928, therefore, she was 13 or 14 years old when the war broke out.
When asked if she can remember that it was only in the early months of the year 1943 when
the Japanese occupied Kalibo, she said she [was] not sure. She further testified that
Inocentes Trinidad was buried in their private lot because Kalibo was then occupied by the
Japanese forces and nobody would carry his body to be buried in the Poblacion.

For rebuttal evidence, [petitioner] presented ISABEL MEREN, who was 76 years old and a
resident of Tigayon. Rebuttal witness testified that . . . she knew both the [petitioner] and the
[private respondents] in this case very well as her house is only around 200 meters from
them. When asked if it is true that according to Lourdes Trinidad, [Inocentes Trinidad] arrived
from Manila in 1941 and he lived only for 15 days and died, witness testified that he did not
die in that year because he died in the year 1944, and that Inocentes Trinidad lived with his
sister, Lourdes Trinidad, in a house which is only across the street from her house. According
to the said rebuttal witness, it is not true that Inocentes Trinidad died single because he had a
wife by the name of Felicidad Molato whom he married on May 5, 1942 in New Washington,
Aklan. That she knew this fact because she was personally present when couple was married
by Lauriano Lajaylajay, a protestant pastor.

On cross examination, rebuttal witness testified that when Inocentes Trinidad arrived from
Manila he was in good physical condition. That she knew both Inocentes Trinidad and
Felicidad Molato to be Catholics but that according to her, their marriage was solemnized by a
Protestant minister and she was one of the sponsors. That during the marriage of Inocentes
Trinidad and Felicidad Molato, Lourdes Trinidad and Felix Trinidad were also present.

When plaintiff, ARTURIO TRINIDAD, was presented as rebuttal witness, he was not able to
present a marriage contract of his parents but instead a certification dated September 5, 1978
issued by one Remedios Eleserio of the Local Civil Registrar of the Municipality of New
Washington, Aklan, attesting to the fact that records of births, deaths, and marriages in the
municipality of New Washington were destroyed during the Japanese time.

Respondent Court's Ruling

In finding that petitioner was not a child, legitimate or otherwise, of the late Inocentes Trinidad, Respondent
Court ruled: 14

We sustain the appeal on the ground that plaintiff has not adduced sufficient evidence to
prove that he is the son of the late Inocentes Trinidad. But the action to claim legitimacy has
not prescribed.

Plaintiff has not established that he was recognized, as a legitimate son of the late Inocentes
Trinidad, in the record of birth or a final judgment, in a public document or a private
handwritten instrument, or that he was in continuous possession of the status of a legitimate
child.

Two witnesses, Pedro Briones and Beatriz Trinidad Sayon, testified for the defendants that
Inocentes Trinidad never married. He died single in 1941. One witness, Isabel Maren, testified
in rebuttal for the plaintiff, that Inocentes Trinidad married Felicidad Molato in New
Washington, Aklan, on May 5, 1942, solemnized by a pastor of the protestant church and that
she attended the wedding ceremony (t.s.n. Sept. 6, 1988, p. 4). Hence, there was no
preponderant evidence of the marriage, nor of Inocentes' acknowledgment of plaintiff as his
son, who was born on July 21, 1943.

The right to demand partition does not prescribe (de Castro vs. Echarri, 20 Phil. 23). Where
one of the interested parties openly and adversely occupies the property without recognizing
the co-ownership (Cordova vs. Cordova, L-9936, January 14, 1958) acquisitive prescription
may set in (Florenz D. Regalado, Remedial Law Compendium, Vol. I, Fifth Revised Edition,
1988, p. 497). Admittedly, the defendants have been in possession of the parcels of land
involved in the concept of owners since their father died in 1940. Even if possession be
counted from 1964, when plaintiff attained the age of majority, still, defendants possessed the
land for more than ten (10) years, thus acquiring ownership of the same by acquisitive
prescription (Article 1134, Civil Code of the Philippines).

The Issues

Petitioner submits the following issues for resolution: 15

1. Whether or not petitioner (plaintiff-appellee) has proven by preponderant evidence the


marriage of his parents.

2. Whether or not petitioner (plaintiff-appellee) has adduced sufficient evidence to prove that
he is the son of the late Inocentes Trinidad, brother of private respondents (defendants-
appellants) Felix and Lourdes Trinidad.

3. Whether or not the Family Code is applicable to the case at bar[,] the decision of the
Regional Trial Court having been promulgated on July 4, 1989, after the Family Code became
effective on August 3, 1988.

4. Whether or not petitioner's status as a legitimate child can be attached collaterally by the
private respondents.

5. Whether or not of private respondent (defendants-appellants) have acquired ownership of


the properties in question by acquisitive prescription.

Simply stated, the main issues raised in this petition are:

1. Did petitioner present sufficient evidence of his parents' marriage and of his filiation?

2. Was petitioner's status as a legitimate child subject to collateral attack in the action for partition?

3. Was his claim time-barred under the rules on acquisitive prescription?

The Court's Ruling

The merits of this petition are patent. The partition of the late Patricio's real properties requires preponderant
proof that petitioner is a co-owner or co-heir of the decedent's estate. 16 His right as a co-owner would, in turn,
depend on whether he was born during the existence of a valid and subsisting marriage between his mother
(Felicidad) and his putative father (Inocentes). This Court holds that such burden was successfully discharged
by petitioner and, thus, the reversal of the assailed Decision and Resolution is inevitable.

First and Second Issues: Evidence of and Collateral Attack on Filiation

At the outset, we stress that an appellate court's assessment of the evidence presented by the parties will not,
as a rule, be disturbed because the Supreme Court is not a trier of facts. But in the face of the contradictory
conclusions of the appellate and the trial courts, such rule does not apply here. So, we had to meticulously pore
over the records and the evidence adduced in this case. 17

Petitioner's first burden is to prove that Inocentes and his mother (Felicidad) were validly married, and that he
was born during the subsistence of their marriage. This, according to Respondent Court, he failed to
accomplish.

This Court disagrees. Pugeda vs. Trias 18 ruled that when the question of whether a marriage has been
contracted arises in litigation, said marriage may be proven by relevant evidence. To prove the fact of marriage,
the following would constitute competent evidence: the testimony of a witness to the matrimony, the couple's
public and open cohabitation as husband and wife after the alleged wedlock, the birth and the baptismal
certificates of children born during such union, and the mention of such nuptial in subsequent documents. 19

In the case at bar, petitioner secured a certification 20 from the Office of the Civil Registrar of Aklan that all
records of births, deaths and marriages were either lost, burned or destroyed during the Japanese occupation
of said municipality. This fact, however, is not fatal to petitioner's case. Although the marriage contract is
considered the primary evidence of the marital union, petitioner's failure to present it is not proof that no
marriage took place, as other forms of relevant evidence may take its place. 21

In place of a marriage contract, two witnesses were presented by petitioner: Isabel Meren, who testified that
she was present during the nuptial of Felicidad and Inocentes on May 5, 1942 in New Washington, Aklan; and
Jovita Gerardo, who testified that the couple deported themselves as husband and wife after the marriage.
Gerardo, the 77-year old barangay captain of Tigayon and former board member of the local parent-teachers'
association, used to visit Inocentes and Felicidad's house twice or thrice a week, as she lived only thirty meters
away.22 On July 21, 1943, Gerardo dropped by Inocentes' house when Felicidad gave birth to petitioner. She
also attended petitioner's baptismal party held at the same house. 23 Her testimony constitutes evidence of
common reputation respecting marriage. 24 It further gives rise to the disputable presumption that a man and a
woman deporting themselves as husband and wife have entered into a lawful contract of marriage. 25 Petitioner
also presented his baptismal certificate (Exhibit C) in which Inocentes and Felicidad were named as the child's
father and mother. 26

On the other hand, filiation may be proven by the following:

Art. 265. The filiation of legitimate children is proved by the record of birth appearing in the
Civil Register, or by an authentic document or a final judgment.

Art. 266. In the absence of the titles indicated in the preceding article, the filiation shall be
proved by the continuous possession of status of a legitimate child.

Art. 267. In the absence of a record of birth, authentic document, final judgment or possession
of status, legitimate filiation may be proved by any other means allowed by the Rules of Court
and special laws. 27

Petitioner submitted in evidence a certification 28 that records relative to his birth were either destroyed during
the last world war or burned when the old town hall was razed to the ground on June 17, 1956. To prove his
filiation, he presented in evidence two family pictures, his baptismal certificate and Gerardo's testimony.

The first family picture (Exhibit A) shows petitioner (Exhibit A-5) carrying his second daughter and his wife
(Exhibit A-4) together with the late Felix Trinidad (Exhibit A-2) carrying petitioner's first daughter, and Lourdes
Trinidad (Exhibit A-1). Exhibit B is another picture showing Lourdes Trinidad (Exhibit B-1) carrying petitioner's
first child (Exhibit B-2). These pictures were taken before the case was instituted. Although they do not directly
prove petitioner's filiation to Inocentes, they show that petitioner was accepted by the private respondents as
Inocentes' legitimate son ante litem motam.

Lourdes' denials of these pictures are hollow and evasive. While she admitted that Exhibit B shows her holding
Clarita Trinidad, the petitioner's daughter, she demurred that she did so only because she was requested to
carry the child before she was baptized. 29 When shown Exhibit A, she recognized her late brother — but not
petitioner, his wife and the couple's children — slyly explaining that she could not clearly see because of an
alleged eye defect. 30

Although a baptismal certificate is indeed not a conclusive proof of filiation, it is one of "the other means
allowed under the Rules of Court and special laws" to show pedigree, as this Court ruled in Mendoza vs. Court
of Appeals: 31

What both the trial court and the respondent court did not take into account is that an
illegitimate child is allowed to establish his claimed filiation by "any other means allowed by
the Rules of Court and special laws," according to the Civil Code, or "by evidence of proof in
his favor that the defendant is her father," according to the Family Code. Such evidence may
consist of his baptismal certificate, a judicial admission, a family Bible in which his name has
been entered, common reputation respecting his pedigree, admission by silence, the
testimony of witnesses, and other kinds of proof admissible under Rule 130 of the Rules of
Court. [Justice Alicia Sempio-Diy, Handbook on the Family Code of the Phil. 1988 ed., p. 246]

Concededly, because Gerardo was not shown to be a member of the Trinidad family by either consanguinity or
affinity, 32 her testimony does not constitute family reputation regarding pedigree. Hence, it cannot, by itself, be
used to establish petitioner's legitimacy.

Be that as it may, the totality of petitioner's positive evidence clearly preponderates over private respondents'
self-serving negations. In sum, private respondents' thesis is that Inocentes died unwed and without issue in
March 1941. Private respondents' witness, Pedro Briones, testified that Inocentes died in 1940 and was buried
in the estate of the Trinidads, because nobody was willing to carry the coffin to the cemetery in Kalibo, which
was then occupied by the Japanese forces. His testimony, however, is far from credible because he stayed
with the Trinidads for only three months, and his answers on direct examination were noncommittal and
evasive: 33

Q: At the time of his death, can you tell the Court if this Inocentes Trinidad
was married or not?

A: Not married.

Q: In 1940 at the time of death of Inocentes Trinidad, where were you


residing?

A: I was staying with them.

Q: When you said "them", to whom are you referring to [sic]?

A: My aunt Nanay Taya, Anastacia.

xxx xxx xxx

Q: Will you please tell the Court for how long did you stay with your aunt
Anastacia Trinidad and his children before 1940?

A: For only three months.

Q: Now, you said at the time of his death, Inocentes Trinidad was single. Do
you know if he had cohabited with anybody before his death?

A: [T]hat I do not know.

Q: You know a person by the name of Felicidad Molato?

A: No, sir.

Q: Can you recall if during the lifetime of Inocentes Trinidad if you have
known of anybody with whom he has lived as husband and wife?

A: I could not recall because I was then in Manila working.


Q: After the war, do you remember having gone back to the house of your
aunt Anastacia at Tigayon, Kalibo, Aklan?

A: Yes, sir.

Q: How often did you go to the house of your aunt?

A: Every Sunday.

xxx xxx xxx

Q: You know the plaintiff Arturio Trinidad?

A: I do not know him.

Q: After the death of Inocentes Trinidad, do you know if there was anybody
who has stayed with the defendants who claimed to be a son of Inocentes
Trinidad?

A: I do not know about that.

Beatriz Sayon, the other witness of private respondent, testified, that when the Japanese occupied Kalibo in
1941, her father brought Inocentes from Manila to Tigayon because he was sick. Inocentes stayed with their
grandmother, Eugenia Roco Trinidad, and died single and without issue in March 1941, one and a half months
after his return to Tigayon. She knew Felicidad Molato, who was also a resident of Tigayon, but denied that
Felicidad was ever married to Inocentes. 34

Taking judicial notice that World War II did not start until December 7, 1941 with the bombing of Pearl Harbor in
Hawaii, the trial court was not convinced that Inocentes dies in March 1941. 35 The Japanese forces occupied
Manila only on January 2, 1942; 36 thus, it stands to reason that Aklan was not occupied until then. It was only
then that local residents were unwilling to bury their dead in the cemetery In Kalibo, because of the Japanese
soldiers who were roaming around the area. 37

Furthermore, petitioner consistently used Inocentes' surname (Trinidad) without objection from private
respondents — a presumptive proof of his status as Inocentes' legitimate child. 38

Preponderant evidence means that, as a whole, the evidence adduced by one side outweighs that of the
adverse party. 39 Compared to the detailed (even if awkwardly written) ruling of the trial court, Respondent
Court's holding that petitioner failed to prove his legitimate filiation to Inocentes is unconvincing. In determining
where the preponderance of evidence lies, a trial court may consider all the facts and circumstances of the
case, including the witnesses' manner of testifying, their intelligence, their means and opportunity of knowing
the facts to which they are testifying, the nature of the facts, the probability or improbability of their testimony,
their interest or want thereof, and their personal credibility. 40 Applying this rule, the trial court significantly and
convincingly held that the weight of evidence was in petitioner's favor. It declared:

. . . [O]ne thing sure is the fact that plaintiff had lived with defendants enjoying the status of
being their nephew . . . before plaintiff [had] gotten married and had a family of his own where
later on he started demanding for the partition of the share of his father, Inocentes. The fact
that plaintiff had so lived with the defendants . . . is shown by the alleged family pictures,
Exhibits A & B. These family pictures were taken at a time when plaintiff had not broached the
idea of getting his father's share. . . . His demand for the partition of the share of his father
provoked the ire of the defendants, thus, they disowned him as their nephew. . . . In this case,
the plaintiff enjoyed the continuous possession of a status of the child of the alleged father by
the direct acts of the defendants themselves, which status was only broken when plaintiff
demanded for the partition . . . as he was already having a family of his own. . . . .
However, the disowning by the defendant [private respondent herein], Lourdes Trinidad, of the
plaintiff [petitioner herein] being her nephew is offset by the preponderance of evidence,
among them the testimony of witness, Jovita Gerardo, who is the barrio captain. This witness
was already 77 years old at the time she testified. Said witness had no reason to favor the
plaintiff. She had been a PTA officer and the court sized her up as a civic minded person. She
has nothing to gain in this case as compared to the witness for the defendants who are either
cousin or nephew of Lourdes Trinidad who stands to gain in the case for defendant, Lourdes
Trinidad, being already 75 years old, has no husband nor children. 41

Doctrinally, a collateral attack on filiation is not permitted. 42 Rather than rely on this axiom, petitioner chose to
present evidence of his filiation and of his parents' marriage. Hence, there is no more need to rule on the
application of this doctrine to petitioner's cause.

Third Issue: No Acquisitive Prescription

Respondent Court ruled that, because acquisitive prescription sets in when one of the interested parties openly
and adversely occupies the property without recognizing the co-ownership, and because private respondents
had been in possession — in the concept of owners — of the parcels of land in issue since Patricio died in
1940, they acquired ownership of these parcels.

The Court disagrees. Private respondents have not acquired ownership of the property in question by
acquisitive prescription. In a co-ownership, the act of one benefits all the other co-owners, unless the former
repudiates the co-ownership.43 Thus, no prescription runs in favor of a co-owner or co-heir against his or her co-
owners or co-heirs, so long as he or she expressly or impliedly recognizes the co-ownership.

In this particular case, it is undisputed that, prior to the action for partition, petitioner, in the concept of a co-
owner, was receiving from private respondents his share of the produce of the land in dispute. Until such time,
recognition of the co-ownership by private respondents was beyond question. There is no evidence, either, of
their repudiation, if any, of the co-ownership of petitioner's father Inocentes over the land. Further, the titles of
these pieces of land were still in their father's name. Although private respondents had possessed these
parcels openly since 1940 and had not shared with petitioner the produce of the land during the pendency of
this case, still, they manifested no repudiation of the co-ownership. In Mariategui vs. Court of Appeals, the
Court held: 44

. . . Corollarily, prescription does not run again private respondents with respect to the filing of
the action for partition so long as the heirs for whose benefit prescription is invoked, have not
expressly or impliedly repudiated the co-ownership. In the other words, prescription of an
action for partition does not lie except when the co-ownership is properly repudiated by the
co-owner (Del Banco vs. Intermediate Appellate Court, 156 SCRA 55 [1987] citing Jardin vs.
Hollasco, 117 SCRA 532 [1982]).

Otherwise stated, a co-owner cannot acquire by prescription the share of the other co-owners
absent a clear repudiation of co-ownership duly communicated to the other co-owners
(Mariano vs. De Vega, 148 SCRA 342 [1987]). Furthermore, an action to demand partition is
imprescriptible and cannot be barred by laches (Del Banco vs. IAC, 156 SCRA 55 (1987). On
the other hand, an action for partition may be seen to be at once an action for declaration of
co-ownership and for segregation and conveyance of a determinate portion of the property
involved (Rogue vs. IAC, 165 SCRA 118 [1988]).

Considering the foregoing, Respondent Court committed reversible error in holding that petitioner's claim over
the land in dispute was time-barred.

WHEREFORE, the petition is GRANTED and the assailed Decision and Resolution are REVERSED and SET
ASIDE. The trial court's decision dated July 4, 1989 is REINSTATED. No costs.
G.R. No. 124262 October 12, 1999

TOMAS CLAUDIO MEMORIAL COLLEGE, INC., petitioner,


vs.
COURT OF APPEALS, HON. ALEJANDRO S. MARQUEZ, CRISANTA DE CASTRO, ELPIDIA DE CASTRO,
EFRINA DE CASTRO, IRENEO DE CASTRO and ARTEMIO DE CASTRO ADRIANO, respondents.

QUISUMBING, J.:

This special civil action for certiorari seeks to set aside the Decision of the Court Appeals dated August 14,
1995, in CA-G.R. SP No. 36349, and its Resolution dated March 15, 1996, which denied petitioner's motion for
reconsideration.1âwphi1.nêt

On December 13, 1993, private respondents filed an action for Partition before the Regional Trial Court of
Morong, Rizal. They alleged that their predecessor-in-interest, Juan De Castro, died intestate in 1993 and they
are his only surviving and legitimate heirs. They also alleged that their father owned a parcel of land designated
as Lot No. 3010 located at Barrio San Juan, Morong, Rizal, with an area of two thousand two hundred sixty
nine (2,269) square meters more or less. They further claim that in 1979, without their knowledge and consent,
said lot was sold by their brother Mariano to petitioner. The sale was made possible when Mariano represented
himself as the sole heir to the property. It is the contention of private respondents that the sale made by
Mariano affected only his undivided share to the lot in question but not the shares of the other co-owners
equivalent to four fifths (4/5) of the property.

Petitioner filed a motion to dismiss contending, as its special defense, lack of jurisdiction and prescription
and/or laches. The trial court, after hearing the motion, dismissed the complaint in an Order dated August 18,
1984. On motion for reconsideration, the trial court, in an Order dated October 4, 1994, reconsidered the
dismissal of the complaint and set aside its previous order. Petitioner filed its own motion for reconsideration
but it was denied in an Order dated January 5, 1995.

Aggrieved, petitioner filed with the Court of Appeals a special civil action for certiorari anchored on the following
grounds: a) the RTC has no jurisdiction to try and take cognizance of the case as the causes of actions have
been decided with finality by the Supreme Court, and b) the RTC acted with grave abuse of discretion and
authority in taking cognizance of the case.

After the parties filed their respective pleadings, the Court of Appeals, finding no grave abuse of discretion
committed by the lower court, dismissed the petition in a Decision dated August 14, 1995. Petitioner filed a
timely motion for reconsideration but it was denied in a Resolution dated March 15, 1996. Hence this petition.

Petitioner submits the following grounds to support the granting of the writ of certiorari in the present case:

FIRST GROUND

THE HON. COURT OF APPEALS AND THE REGIONAL TRIAL COURT (BR. 79) HAD NO
JURISDICTION TO TRY SUBJECT CASE (SP. PROC. NO. 118-M). THE "CAUSES OF
ACTION" HEREIN HAVE BEEN FINALLY DECIDED BY THE HON. COURT OF FIRST
INSTANCE OF RIZAL (BR. 31) MAKATI, METRO MANILA, AND SUSTAINED IN A FINAL
DECISION BY THE HON. SUPREME COURT.

SECOND GROUND

THE HON. COURT OF APPEALS GRAVELY ABUSED ITS DISCRETION AND AUTHORITY
WHEN IT SUSTAINED THE ORDERS OF THE HON. REGIONAL TRIAL COURT (BR. 79)
DATED OCTOBER 4, 1994, AND THE ORDER DATED JANUARY 5, 1995, WHEN SAID
RTC (BR. 79) INSISTED IN TRYING THIS CASE AGAINST TCMC WHEN IT HAS RULED
ALREADY IN A FINAL ORDER THAT PETITIONER IS NOT A "REAL PARTY" IN INTEREST
BY THE HON. REGIONAL TRIAL COURT (BR. 79) IN CIVIL CASE NO. 170,
ENTITLED ELPIDIA A. DE CASTRO, ET. AL. vs. TOMAS CLAUDIO MEMORIAL
COLLEGE, ET . AL., WHICH CASE INVOLVED THE SAME RELIEF, SAME SUBJECT
MATTER AND THE SAME PARTIES.

THIRD GROUND

THE HON. COURT OF APPEALS GRAVELY ABUSED ITS DISCRETION AND AUTHORITY
WHEN IT CAPRICIOUSLY AND WHIMSICALLY DISREGARDED THE EXISTENCE OF RES
JUDICATA IN THIS CASE.

The pivotal issues to be resolved in this case are: whether or not the Regional Trial Court and/or the Court of
Appeals had jurisdiction over the case, and if so, whether or not the Court of Appeals committed grave abuse
of discretion in affirming the decision of the Regional Trial Court.

In assailing the Orders of the appellate court, petitioner invokes Rule 65 of the Rules of Court as its mode in
obtaining a reversal of the assailed Decision and Resolution. Before we dwell on the merits of this petition, it is
worth noting, that for a petition for certiorari to be granted, it must be shown that the respondent court
committed grave abuse of discretion equivalent to lack or excess of jurisdiction and not mere errors of
judgment, for certiorari is not a remedy for errors of judgment, which are correctible by appeal. 1 By grave
abuse of discretion is meant such capricious and whimsical exercise of judgment as is equivalent to lack of
jurisdiction, and mere abuse of discretion is not enough — it must be grave. 2

In the case at hand, there is no showing of grave abuse of discretion committed by the public respondent. As
correctly pointed out by the trial court, when it took cognizance of the action for partition filed by the private
respondents, it acquired jurisdiction over the subject matter of the case. 3 Jurisdiction over the subject matter of
a case is conferred by law and is determined by the allegations of the complaint irrespective of whether the
plaintiff is entitled to all or some of the claims asserted therein. 4 Acquiring jurisdiction over the subject matter of
a case does not necessarily mean that the lower court meant to reverse the decision of the Supreme Court in
the land registration case mentioned by the petitioner.

Moreover, settled is the rule that the jurisdiction of the court over the subject matter is determined by the
allegations of the complaint, hence the court's jurisdiction cannot be made to depend upon defenses set up in
the answer or in a motion to dismiss. 5 This has to be so, for were the principle otherwise, the ends of justice
would be frustrated by making the sufficiency of this kind of action dependent upon the defendant in all cases.

Worth stressing, as long as a court acts within its jurisdiction any alleged errors committed in the exercise
thereof will amount to nothing more than errors of judgment which are revisable by timely appeal and not by a
special civil action of certiorari. 6 Based on the foregoing, even assuming for the sake of argument that the
appellate court erred in affirming the decision of the trial court, which earlier denied petitioner's motion to
dismiss, such actuation on the part of the appellate court cannot be considered as grave abuse of discretion,
hence not correctible by certiorari, because certiorari is not available to correct errors of procedure or mistakes
in the judge's findings and conclusions.

In addition, it is now too late for petitioner to question the jurisdiction of the Court of Appeals. It was petitioner
who elevated the instant controversy to the Court of Appeals via a petition for certiorari. In effect, petitioner
submitted itself to the jurisdiction of the Court of Appeals by seeking affirmative relief therefrom. If a party
invokes the jurisdiction of a court, he cannot thereafter challenge that court's jurisdiction in the same case. 7 To
do otherwise would amount to speculating on the fortune of litigation, which is against the policy of the Court.

On the issue of prescription, we have ruled that even if a co-owner sells the whole property as his, the sale will
affect only his own share but not those of the other co-owners who did not consent to the sale. 8 Under Article
493 of the Civil Code, the sale or other disposition affects only the seller's share pro indiviso, and the transferee
gets only what corresponds to his grantor's share in the partition of the property owned in common. Since a co-
owner is entitled to sell his undivided share, a sale of the entire property by one co-owner without the consent
of the other co-owners is not null and void. However, only the rights of the co-owner/seller are transferred,
thereby making the buyer a co-owner of the property. The proper action in a case like this, is not for the
nullification of the sale, or for the recovery of possession of the property owned in common from the third
person, but for division or partition of the entire property if it continued to remain in the possession of the co-
owners who possessed and administered it. 9Such partition should result in segregating the portion belonging
to the seller and its delivery to the buyer.
1âw phi1.nêt

In the light of the foregoing, petitioner's defense of prescription against an action for partition is a vain
proposition. Pursuant to Article 494 of the Civil Code, "no co-owner shall be obliged to remain in the co-
ownership. Such co-owner may demand at anytime the partition of the thing owned in common, insofar as his
share is concerned." In Budlong vs. Bondoc, 10 this Court has interpreted said provision of law to mean that the
action for partition is imprescriptible. It cannot be barred by prescription. For Article 494 of the Civil Code
explicitly declares: "No prescription shall lie in favor of a co-owner or co-heirs as long as he expressly or
impliedly recognizes the co-ownership."

WHEREFORE, the instant petition is DENIED. The assailed decision of the Court of Appeals is hereby
AFFIRMED. Costs against petitioners.
G.R. No. 139524 October 12, 2000

PHILIP C. SANTOS and HEIRS OF ELISEO M. SANTOS, petitioners,


vs.
LADISLAO M. SANTOS represented herein by his Attorney-In-Fact NOE M. SANTOS, respondents.

DECISION

GONZAGA-REYES, J.:

Before us is a petition for review on certiorari assailing the January 8, 1999 Decision1 of the Court of Appeals2 in
CA-G.R. CV No. 48576 which reversed the decision3 of the Regional Trial Court4 of San Mateo, Rizal (Branch
76) and which declared Ladislao M. Santos and Eliseo M. Santos as entitled to ½ pro indiviso shares in the
property of Isidra M. Santos. The dispositive portion of the assailed Decision reads:

"IN THE LIGHT OF ALL THE FOREGOING, the appeal is granted. The Decision appealed from
is REVERSED. Judgment is hereby rendered in favor of the Appellant and against the Appellees as follows:

1. Tax Declaration Nos. 04-0566 and 04-0016, Exhibits "8" and "9", under the name of Appellee
Philip Santos and the "Deed of Sale of Unregistered Residential Land" (Exhibit "15’) are hereby
declared inefficacious insofar as the undivided one-half portion of the Appellant in the Isidra property is
concerned;

2. The Appellant and the Appellee Eliseo Santos are hereby declared each entitled to ½ pro
indiviso shares in the Isidra property;

3. The Court a quo is hereby ordered to effect the partition of the subject lot conformably with Rule 69
of the 1997 Rules of Civil procedure.

Without pronouncement as to costs.

SO ORDERED."

The following facts as narrated by the Court of Appeals are undisputed:

On May 13, 1993, Ladislao Santos, a resident in the United States of America, the Appellant in the present
recourse, through his Attorney-in-fact, Noe Santos, filed a complaint, with the Regional Trial Court of Rizal,
against his brother, Eliseo Santos and the latter’s son, Philip Santos, the Appellees in the present recourse,
for "Judicial Partition".

The Appellant averred, inter alia, in his complaint, that, when his and Eliseo Santos’ sister, Isidra Santos, died
intestate on April 1, 1967, without any issue, they inherited her parcel of land covered by Tax Declaration 1115,
issued by the Provincial Assessor of Rizal located along General Luna Street, Gitnangbayan, San Mateo, Rizal;
that, sometime, in February 1, 1993, the Appellant discovered that Tax Declaration No. 1115 had been
cancelled by Tax Declaration No. 7892, under the name of his nephew, Appellee Philip Santos, and that, on
December 16, 1980, Virgilio Santos executed a "Deed of Absolute Sale of Unregistered Residential
Land" on the basis of which Tax Declaration No. 04-0016 was issued to the Appellee Philip Santos. The
Appellant prayed the Court that judgment be rendered in his favor as follows:

"WHEREFORE, it is most respectfully prayed of this Honorable Court that after due hearing judgment be
rendered as follows:

(1) Ordering the division of the intestate estate of the late Isidra Santos between petitioner and
respondent Eliseo M. Santos;
(2) Declaring Tax Declaration No. 04-0015 in the name of Virgilio Santos as null and void;

(3) Declaring the Deed of Sale dated December 11, 1980, executed by Virgilio Santos in favor of Philip
Santos as null and void;

(4) Declaring Tax Declaration No. 04-00161 (sic) in the name of Philip Santos as null and void;

Petitioner prays for other relief which this Court may deem just and equitable in the premises." (at page 3,
Records)

In their Answer to the complaint, the Appellees admitted that, upon the demise of Isidra Santos, the Appellant
and the Appellee Eliseo Santos inherited the said property and the latter’s share in Lot 1522 of the San Mateo
Cadastre, which they and their sister, Isidra Santos, inherited from their father, Bonifacio Santos who died
before the outbreak of the Second World War but insisted that the Appellant and the Appellee Eliseo Santos
had agreed, in 1969, after the death of Isidra Santos, on April 1, 1967, to partition Lot 1522, under which a
portion of Lot 1522, with an area of 3,387 square meters, was adjudicated to the Appellant, and a portion of the
same lot, with an area of 3,000 square meters, was conveyed to the Appellee Eliseo Santos and the parcel of
land left by Isidra Santos was conveyed by Appellee Eliseo Santos to Virgilio Santos, who, from infancy had
been under the care of Isidra Santos, to approximately equalize the share of the Appellee Eliseo Santos in the
estate of Bonifacio Santos. The Appellees further averred that Appellees had acquired the Isidra property by
acquisitive prescription.

Neither Appellant Ladislao Santos nor Appellee Eliseo Santos testified in the Court a quo. Although the
Appellee Eliseo Santos was present during the proceeding, he did not testify anymore because of senility being
then about 88 years old. Virginia Santos, the widow of Virgilio Santos, testified, in the Court a quo, and
declared, that she and Virgilio Santos married, on February 12, 1967, and resided in the house of Isidra Santos
until the sale, by Virgilio Santos, of the Isidra property to his brother, the Appellee Philip Santos and in
exchange with the property of the latter located at Kambal Street, Gitnangbayan, San Mateo, Rizal, where the
couple and, after Virgilio Santos’ death, on April 5, 1984, had been residing. Virginia Santos likewise declared
that Appellant Ladislao Santos and the Appellee Eliseo Santos had an agreement, notarized by Atty. Sixto
Natividad, that Virgilio Santos and Virginia Santos became the new owners of the Isidra property. The copy of
the Agreement given Virgilio Santos was xeroxed and the xerox copy was given to Appellee Philip Santos while
Virgilio Santos’ copy was filed with the Provincial Assessor’s Office on the basis of which, Tax Declaration No.
7892 was issued under his name. The Appellee Philip Santos, on the other hand, declared that the Appellant
Ladislao Santos and the Appellee Eliseo Santos and their respective Spouses executed a "Combined Deed of
Partition", in 1969, covering the Lot 1522 and the Isidra Property, wherein it was covenanted that the Isidra
Property was deeded to Appellee Eliseo Santos. The Appellee Philip Santos further declared that he was then
about 20 years old, and saw the said "Combined Deed of Partition" in the possession of Appellee Eliseo
Santos.

After due proceedings, the Court a quo promulgated a Decision dismissing Appellant’s complaint on the ground
that the Appellant failed to adduce proof of his entitlement to the relief prayed for by him and on the ground of
acquisitive prescription.

The present recourse stemmed from the following factual backdrop - when Bonifacio Santos died intestate, he
was survived by his two (2) sons, namely Ladislao Santos, the Appellant in the present recourse, and Appellee
Eliseo Santos, one of the Appellees in the present recourse and their sister, Isidra Santos. The latter was the
owner of a parcel of land, hereinafter referred to, for brevity’s sake, as the Isidra property, located in General
Luna Street, Gitnangbayan, San Mateo, Rizal, with an area of 391 square meters, more or less, covered by
Tax Declaration No. 655, located in front of but oblique to and about fifty (50) meters away from the property,
with an area of 6,340 square meters, covered by Tax Declaration No. 383 of the Provincial Assessor’s Office,
(Exhibit "L-3"). She had a house constructed on her lot where she had been residing ever since.

In the meantime, on November 10, 1964, a cadastral survey of lands in San Mateo, Rizal, was undertaken. The
property, with an area of 6,340 square meters was identified as Lot 1522, Cadastre No. 375-D. Tax Declaration
No. 655, covering the Isidra Property was later cancelled by Tax Declaration 1115 under her name, effective
1966 (Exhibit "4").
On May 29, 1967, the Appellant and his wife, Leonila Mateo executed a "Deed of Absolute Conveyance with
Right of Way" over the southwestern portion of Lot 1522, with an area of 3,000 square meters, in favor of his
brother, the Appellee Eliseo Santos for the price of P500.00, with a provision for a right of way.

On April 1, 1967, Isidra Santos died intestate and was survived by her two (2) brothers, the Appellant and the
Appellee Eliseo Santos.

On September 9, 1969, the Provincial Assessor issued Tax Declaration No. 7892, over the Isidra property,
under the name of Virgilio Santos and Virginia Santos, thereby canceling Tax Declaration No. 1115 under the
name of Isidra Santos (Exhibit "5"). In 1972, Tax Declaration No. 7892 was cancelled by Tax Declaration No.
5043, still under the names of Virgilio Santos and Virginia Santos, effective 1974 (Exhibit "4") and by Tax
Declaration No. 04-0015, effective 1980 (Exhibit "7").

On December 16, 1980, Virgilio Santos executed a "Deed of Absolute Sale of Unregistered Residential
Land" in favor of his brother, the Appellee Philip Santos, over the Isidra Property at the time covered by Tax
Declaration No. 04-0015, for the price of P24,460.00 (Exhibit "H"). On the basis of said deed, Tax Declaration
No. 04-0015 was cancelled by Tax Declaration No. 04-0566, under the name of Appellee Philip Santos,
effective 1981 (Exhibit "E"). The Spouses Virgilio Santos vacated the said property and resided at Kambal
Street, Gitnangbayan I, San Mateo, Rizal formerly owned by Philip Santos . The latter, in turn, had the house
on the lot demolished and had his shop installed in the Isidra Property. Since then, Philip Santos had been
paying the realty taxes therefor. On April 5, 1984, Virgilio Santos died intestate and was survived by his wife,
Virginia Santos. In the meantime, the Appellant and Appellee Philip Santos left the Philippines and resided in
the United States of America.

Despite the "Deed of Absolute Conveyance With Right of Way" executed by the Appellant in favor of
Appellee Eliseo Santos, the children of the Appellant and their uncle, the Appellee Eliseo Santos, signed an
Application, on September 26, 1984 and filed the same with the Regional Trial Court of Rizal (at San Mateo)
for the registration of "their title" over Lots 1522 and 2433 of Cadastre 375-D. The Applicants alleged, inter
alia in said application, that Noe Santos, et al., (children of Ladislao Santos), were occupying a portion of Lot
1522, with an area of 3,430 square meters, while Appellee Eliseo Santos was occupying a portion of the same
lot, with an area of 3,000 square meters, more or less, as a site of cockpit building (Exhibit "5"). On July 16,
1986, the Regional Trial Court promulgated a Decision granting the application, the decretal portion of which
reads as follows:

"WHEREFORE, this Court hereby declares herein applicants the absolute owners of that parcels of land
identified as Lot 1522 and Lot 2433, both of Plan AP-04-001205 marked as Exhibit "D" and in consequence
thereof, it is hereby Ordered that the said parcels of land be registered in the names of the applicants, to wit:

1. Noe Santos, married to Felicidad Santos; Asuncion S. Ramos, married to Virgilio Ramos;
LADISLAO SANTOS, JR., married to Regina Linco; NELIA S. MACALALAD, married to Jacinto
Macalalad; OFELIA SANTOS, single; RECTO SANTOS, single, all of legal ages, Filipino citizens and
all are residents of Gen. Luna St., San Mateo, Rizal, an undivided portion of 3,387 square meters of
that parcel of land identified as Lot 1522 of Plan AP-04-001205, marked as Exhibit "D" and undivided
rights, interest and participation of that parcel of land identified as Lot 2433 of the above-mentioned
Plan with an area of 43 square meters, all in equal shares (pro-indiviso);

2. ELISEO SANTOS, of legal age, Filipino citizen, married to Virginia Santos and resident of Gen.
Luna St., San Mateo, Rizal, an undivided portion of 3,000 square meters of that parcel of land
identified as Lot 1522 of Plan AP-04-001205.

Once this Decision becomes final, let an Order of the issuance of a Decree of Registration issue" (Exhibits
"26-E" and "26-F")

On the basis of the Decision of the Court, Noe Santos, et al., and Appellee Eliseo Santos, were issued an
Original Certificate of Title No. ON-1146, on November 18, 1986 over Lot 1522 (Exhibit M").
Noe Santos, for and in behalf of his siblings and Appellee Eliseo Santos had a subdivision plan prepared,
subdividing Lot 1522 into two (2) subdivision lots, namely, Lot 1522-A, with an area of 3,000 square meters
(Exhibit "15-A") and Lot 1522-B, with an area of 3,387 square meters (Exhibit "15-B").

In June, 1987, Noe Santos and his siblings and their uncle, Appellee Eliseo Santos, executed a "Partition
Agreement" adjudicating Lot 1522-A, with an area of 3,000 square meters unto Appellee Eliseo Santos, and
Lot 1522-B, with an area of 3,387 square meters, unto Noe Santos, et al., (Exhibit "13"). On the basis of said
deed, Original Certificate of Title No. ON-1146 was cancelled and Transfer Certificate of Title No. 148892 was
issued to Appellee Eliseo Santos over Lot 1522-A (Exhibit "11").

On March 17, 1993, Appellant Ladislao Santos, through counsel, sent a letter to the Appellee Philip Santos
alleging that the Appellant had discovered that the Isidra property inherited by Appellant and Appellee Eliseo,
had been declared, for taxation purposes, under the name of Appellee Philip Santos, on the basis of a "Deed
of Sale" executed by Virgilio Santos and suggesting a conference regarding the matter (Exhibit "J"). The
Appellee Philip Santos wrote to the counsel of the Appellant, declaring, inter alia, that the Isidra property, with
the portion and Lot 1522-A, with an area of 3,000 square meters, formed part of the share of Appellee Eliseo
Santos in the estate of his father, Bonifacio Santos; that Appellee Eliseo Santos transferred the Isidra property
to his son, Virgilio Santos, who, in turn, sold the said property to Appellee Philip Santos, for the amount of
P24,600.00, as part of the consideration of the conveyance, by Appellee Philip Santos, of his property located
in Kambal Street, Gitnangbayan, San Mateo, Rizal, where Virgilio Santos’ widow and family had been residing
(Exhibit "24") and the redemption, by Appellee Philip Santos, of the Mortgage of the property by Virgilio
Santos from the Rural Bank of San Mateo."5

On May 13, 1993, herein respondent Ladislao Santos filed an action for the judicial partition of the Isidra
property. After due proceedings, the trial court promulgated a decision dismissing Ladislao’s complaint on the
ground that the latter failed to adduce proof of his entitlement to the relief prayed for by him and on the ground
of acquisitive prescription. Specifically, the trial court cited the following reasons: (1) the subject property was
registered/declared for taxation purposes only in the name of Isidra Santos; (2) the fact of co-ownership thereof
by reason of inheritance was not reflected in the tax declaration; (3) there was no proof presented that the
cancellation of the tax declaration in Isidra’s name and the issuance of another in Virgilio’s name had been
effected through fraud and misrepresentation; (4) there is no proof that a fake document was presented to the
provincial assessor for the cancellation of the tax declaration and the issuance of another in lieu thereof as all
assessment records were destroyed by the fire which gutted the office of the provincial assessor; and (5) from
the time of Isidra’s death in 1967 up to May 13, 1993 when this case was filed, acquisitive prescription may
have already set in.

In due course, the Court of Appeals, as earlier stated, rendered its assailed Decision granting the appeal,
reversing the trial court’s decision and declaring that Ladislao Santos and Eliseo Santos are each entitled to
½ pro indivisoshares in the Isidra property.

Hence, this appeal to this Court under Rule 45 of the Rules of Court raising the following issues:

"I. THE HONORABLE COURT OF APPEALS ERRED IN NOT UPHOLDING THE LEGALITY AND
REGULARITY OF THE TRANSFER OF ISIDRA PROPERTY TO VIRGILIO SANTOS AND LATER TO
PETITIONER PHILIP C. SANTOS.

II. THE HONORABLE COURT OF APPEALS ERRED IN AWARDING ONE-HALF (1/2) PORTION
PRO INDIVISO OF ISIDRA PROPERTY IN FAVOR OF RESPONDENT DESPITE AND INSPITE OF
THE ABSENCE OF PROOF OF ALLEGED FRAUD AND MISREPRESENTATION IN THE
CANCELLATION OF THE TAX DECLARATION IN ISIDRA’S NAME ANT ITS SUBSEQUENT
TRANSFER TO VIRGILIO SANTOS’ NAME.

III. THE HONORABLE COURT OF APPEALS ERRED IN NOT UPHOLDING THAT ACQUISITIVE
PRESCRIPTION HAS ALREADY SET IN AS TO BAR THE INSTANT ACTION FOR PARTITION.
IV. THE HONORABLE COURT OF APPEALS ERRED IN NOT HOLDING THAT RESPONDENT’S
RIGHT TO FILE THIS INSTANT ACTION FOR PARTITION HAS ALREADY PRESCRIBED.

V. THE HONORABLE COURT OF APPEALS ERRED IN NOT HOLDING THAT LACHES HAS
ALREADY SET IN AS TO BAR RESPONDENT IN ASSERTING HIS CLAIM UNDER THE PETITION.

VI. THE HONORABLE COURT OF APPEALS ERRED IN NOT UPHOLDING THE RIGHT OF
PETITIONER PHILIP SANTOS AS BUYER IN GOOD FAITH AND FOR VALUE." 6

The material aspects of the issues are closely intertwined; hence, they are consolidated into two main issues
specifically dealing with the following subjects: (1) the validity of the transfers of the property originally
belonging to Isidra M. Santos (the Isidra property) from Eliseo Santos to Virgilio Santos and then to Philip
Santos; and (2) whether the action for partition is already barred by ordinary acquisitive prescription of ten
years and estoppel by laches.

The petition is not meritorious.

The controversy involves a 391 square meter parcel of land situated in San Mateo, Rizal, owned by Isidra
Santos, a spinster who died intestate and without issue in 1967. She was survived by her two brothers,
Ladislao and Eliseo. Sometime in 1993, Ladislao through his attorney-in-fact Noe M. Santos filed an action for
judicial partition of the Isidra property against his brother Eliseo and the latter’s son Philip. While admitting that
Ladislao and Eliseo inherited the subject Isidra property, Eliseo and Philip submitted that "Eliseo Santos and
wife and Ladsilao and wife signed a document wherein Eliseo acquired the subject lot from the combined
partition of the estate of their father Bonifacio Santos and their sister Isidra Santos. Bonifacio’s estate was
composed of 6,387 square meters while that of Isidra Santos is the subject property with an area of 391 square
meters. Out of this combined parcels of land, respondent got 3,387 square meters while Eliseo got 3,000
square meters and the subject Isidra property with an area of 391 square meters. Eliseo, in turn, donated the
subject Isidra property to his son, Virgilio Santos."

Considering that petitioners Eliseo and Philip disputed the status of Ladislao as co-owner on the ground that
the brothers entered into a Combined Deed of Partition wherein the entire Isidra property was conveyed to
Eliseo, It was then incumbent upon them to present the best evidence obtainable to prove the same. We agree
with the Court of Appeals that the claim of a subsisting co-ownership by Ladislao over the Isidra property has
not been effectively refuted by Eliseo and Philip, and that Eliseo and his successors-in-interest (Virgilio and
Philip) did not acquire exclusive title over the entire Isidra property.

Petitioners insist that they have effectively refuted the co-ownership between Ladislao and Eliseo based on a
"lawful document" proven as follows in the court a quo: (1) the annotation at the back of Tax Declaration No.
1115 which states: "cancelled by Tax No. 7892, dated September 9, 1969, Virgilio and Virginia Cruz-Santos";
(2) Rodolfo Bautista, municipal assessor of San Mateo, Rizal testified on the existence of the "document"
authorizing the cancellation of Tax Declaration No. 1115 in favor of the issuance of Tax Declaration No. 7892 in
Virgilio’s name; (3) Virginia Santos (wife of Virgilio), Philip and a certain Dr. Linco testified on the existence of
said "document". In relation to the foregoing, petitioners argue that the Isidra property was acquired through a
valid document inscribed in the tax declaration;7 that the existence and nature of this document was proved by
testimonial evidence; and that respondent was not able to show that the document registered with the
provincial assessor’s office was not the combined partition or deed of transfer by brothers Ladislao and Eliseo.

We agree with the Court of Appeals that only the original document is the best evidence of the fact as to
whether the brothers Ladislao and Eliseo Santos executed a Combined Deed of Partition wherein the entire
property of Isidra Santos was conveyed to Eliseo. In the absence of such document, petitioners’ arguments
regarding said partition must fail. The testimonies of Virginia Santos and Philip Santos on the existence of and
the contents of the aforesaid documents are, at most, secondary evidence, which are inadmissible considering
that the petitioners as the offerors failed to prove any of the exceptions provided in Section 3, Rule 130 of the
Rules of Court8 and to establish the conditions for their admissibility.9 We quote with favor the findings of the
Court of Appeals, thus:
"Even if we assumed, for the nonce, that indeed, Lot 1522 was inherited by the Appellant and his brother, the
Appellee Eliseo Santos, however, we are not convinced that the Appellant and his wife deeded to the Appellee
Eliseo Santos and the latter to Virgilio Santos the Isidra Property under a "Deed of Transfer" as testified to by
Virginia Santos or under a "Combined Deed of Partition" as testified to by Appellee Philip Santos. The
Appellees never adduced in evidence any copy of the said deed executed by the Appellant and the Appellee
Eliseo Santos and their respective spouses. Since the subject of inquiry was the subject of said deed, it was
incumbent on the Appellees to adduce in evidence the original of the deed or a copy of the original of the deed
conformably with Section 3, Rule 130 of the Rules of Evidence. The Appellees failed to do so. The Court a quo
allowed the Appellees to adduce secondary evidence to prove the contents of the said deed, but it was
inappropriate for the Court a quo to do so over the objections of the Appellant. This is so because, before the
Appellees are allowed to adduce secondary evidence to prove the contents of the original of the deed, the
Appellees had to prove, with the requisite quantum of evidence, the loss or destruction or unavailability of all
the copies of the original of the deed. As former Supreme Court Chief Justice Manuel V. Moran declared:

"Where there are two or more originals, it must appear that all of them have been lost, destroyed or cannot be
produced before secondary evidence can be given of any one. For example, a lease was executed in duplicate,
one being retained by the lessor and the other by the lessee. Either copy was, therefore, an original, and could
have been introduced as evidence of the contract without the production of the other. One of these originals
could not be found. The non-production of the other was not accounted for it was held that "under these
circumstances, the rule is that no secondary evidence of the contents of either is admissible until it is shown
that originals must be accounted for before secondary evidence can be given of any one." (Moran, Comments
on the Rules of Court, Volume V, 1970 ed. at pages 90-91, supra, underscoring supplied)

Indeed, before a party is allowed to adduce secondary evidence to prove the contents of the original of the
deed, the offeror is mandated to prove the following:

"(a) the execution and existence of the original (b) the loss and destruction of the original or its non-production
in court; and (c) unavailability of the original is not due to bad faith on the part of the offeror." (Francisco, Rules
of Court, Part I, Volume VII, 1997 ed. at page 154)."

When she testified in the Court a quo, Virginia Santos declared that there were three (3) copies of the deed
signed by the parties thereof. One copy of the deed was given to Virgilio Santos, one copy was retained by the
Appellee Eliseo Santos, and one copy was retained by Atty. Sixto Natividad, the Notary Public. Virgilio Santos
had his copy xeroxed and gave the xerox copy to Appellee Philip Santos. Virgilio Sanots’ copy was later filed
with the Provincial Assessor’s Office. x x x.

xxx xxx x x x.

When he testified in the Court a quo, the Appellee Philip Santos admitted that he saw a copy of the deed in the
possession of his father, the Appellee Eliseo Santos:

xxx xxx x x x.

While the Appellees adduced evidence that the copy filed with the Provincial Assessor’s Office was burned
when the Office of the Provincial Assessor was burned on April 7, 1977, however, the Appellees failed to
adduce proof that the copy in the possession of Atty. Sixto Natividad was lost or destroyed. It bears stressing
that a Notary Public is mandated, under the Notarial Law, to retain two (2) copies of every deed involving real
estate as part of his notarial record, a copy of which he is to submit to the Notarial Section of the Regional Trial
Court.

The Appellees could very well have procured, by subpoenae ad testificandum and duces tecum, the
attendance of Atty. Sixto Natividad before the Court a quo and bring with him his copy of the deed. After all,
there is no evidence on record that he was already dead or was unavailable at the time of the trial in the Court
a quo. The Appellees did not. Moreover, the Appellees failed to prove the loss or destruction of the copy on file
with the Notarial Section of the Regional Trial Court or of the copy in the possession of the Appellee Eliseo
Santos. Assuming, for the nonce, that the Appellees mustered the requisite quantum of evidence to prove the
loss or destruction of all the copies of the original of the deed, however, Section 5 of Rule 130 of the Rules of
Evidence provides that, before testimonial evidence may be adduced to prove the contents of the original of the
deed, the offeror is mandated to prove the loss or non-availability of any copy of the original or of some
authentic document reciting the contents thereof: x x x."

xxx xxx x x x.

In the present recourse, Virginia Santos admitted that a xerox copy of the deed was given to the Appellee Philip
Santos. However, when she testified in the Court a quo, she admitted not having inquired from the Appellee
Philip Santos if he still had the xerox copy of all deeds that Virgilio gave him. x x x. 10

We also agree with the Court of Appeals that petitioners’ evidence consisting of the tax declarations in Virgilio’s
name and then in Philip’s name are not conclusive and indisputable evidence to show that the lot in question
was conveyed to Virgilio Santos, Philip’s predecessor-in-interest. A mere tax declaration does not vest
ownership of the property upon the declarant. Neither do tax receipts nor declarations of ownership for taxation
purposes constitute adequate evidence of ownership or of the right to possess realty.11

As for the much-vaunted testimony of the municipal assessor of San Mateo, Rizal, the Court of Appeals had
this to say:

"The Appellees presented Rodolfo Bautista, the representative of the Rizal Provincial Assessor, to prove that
Tax Declaration No. 7892, under the name of Virgilio Santos and Virginia Santos, cancelled Tax Declaration
No. 1115, under the name of Isidra Santos, on the basis of the "Combined Deed of Partition" purportedly
executed by the Appellant and his wife, in tandem with the Appellee Eliseo Santos and his wife, which was,
however, burned when the Provincial Assessor’s Office was gutted by fire on April 7, 1977. However, Rodolfo
Bautista himself unabashedly admitted, when he testified in the Court a quo that he had no knowledge of the
nature of the deed that was used for the cancellation of Tax Declaration No. 1115 under the name of Isidra
Santos or the previous document burned or gutted by the fire.

"Atty. Ferry:

Q: When you testified last March 14, 1994, Mr. Bautista, you declared that you assumed your position in the
Office of the Municipal Assessor only on January 6, 1982. Before that, you were not connected with the
Municipal Assessor?

A: I am not yet connected, sir.

Q: So for the first time you learned, in your official capacity, the alleged lost of all records in the Office of the
Provincial Assessor bearing dates 1977 down was only recently?

A: No, sir.

Q: When?

A: When I took over in 1982, sir.

Q: But the fact is, you will agree with me in so far as the present controversy is concerned, you have no way of
determining the particular document presented to the Office of the Provincial Assessor which was made the
basis in effecting the transfer of tax declaration in the name of Isidra Santos in favor of Virgilio Santos marked
in evidence as Exh. 4. You have no way of determining or identifying the particular document used or
presented to the Office of the Provincial Assessor which was made the basis for the cancellation of tax
declaration in the name of Isidra Santos and that paved the issuance of the tax declaration in the name of
Virgilio Santos marked in evidence by the defendants as Exh. 5. You will not be able to know that simply on the
basis of this document? You are in no position to tell or determine what particular document was presented in
the Office of the Provincial Assessor which paved the way to the cancellation of Exh. 4 which is tax declaration
no. 1115 in the name of Isidra Santos and the issuance of another one in the name of Virgilio Santos marked in
evidence as Exh. 5?

A: I do not know, sir (t.s.n. Bautista, at pages 9-10, April 18, 1994, underscoring supplied)

The Appellees can find no solstice12 on the face of Tax Declaration No. 1115, Exhibit "4", which contains the
following entry:

"Cancelled by:

Tax Declaration No. 7892

Dated: Sept. 9, 1969

Virgilio & Virginia Cruz Santos"

(Exhibit "4-B")

This is so because the entry does not contain any clue of the nature of the deed, if it was a deed at all, used for
the cancellation of Tax Declaration No. 1155, the parties who executed the said deed or the beneficiary of said
deed. Indeed, the Court admitted, in its Decision, that there was no way of identifying the document used as
basis for the issuance of a new tax declaration under the name of Virgilio Santos (t.s.n. Bautista, supra).
Virgilio Santos could very well have executed a "Deed of Extra-judicial Settlement of Estate and of Self-
Adjudication of Real Property" covering the Isidra Property and filed the same with the Provincial Assessor
on the basis of which he was issued Tax Declaration No. 7892 over the property. But then, such a deed did not
prejudice the share of the Appellant in the Isidra Property. It is not legally possible for one to adjudicate unto
himself a property he was not the owner of. Hence, We find and so declare that the Isidra Property remained
the property of the Appellant and the Appellee Eliseo Santos as their inheritance from Isidra Santos. As our
Supreme Court declared in an avuncular case:

"Despite admission during the hearing on the identify of the land in question (see p. 21, Record on Appeal),
Maria’s counsel, on appeal, re-emphasized her original claim that the two parcels of land in her possession
were acquired from the Sps. Placido Biduya and Margarita Bose. However, the private document relative to the
purchase, was not produced at the trial, allegedly because they were placed in a trunk in their house which
were burned during the Japanese Occupation. In 1945, Maria sold the riceland. No written evidence was
submitted for all intents therefore, the riceland remained inherited property (Maria Bicarme, et al., versus
Court of Appeals, et al., 186 SCRA 294, at pages 298-299)."

In the light of our findings and disquisitions, Virgilio Santos did not acquire title over the Isidra Property. Hence,
Virgilio Santos could not have lawfully sold the said property to his brother, the Appellee Philip Santos. As the
Latin aphorism goes: "NEMO DAT QUOD NON HABET."13

All told, the testimonies of the prosecution witnesses, Virginia Santos, Philip Santos and Rodolfo Bautista, on
the existence of said document, specifically, the Combined Deed of Partition, cannot be considered in favor of
the petitioners, the same being, at most, secondary evidence.

Anent the second issue, petitioners insist that acquisitive prescription has already set in; and that estoppel lies
to bar the instant action for partition. According to petitioners, Virgilio Santos was already in possession of the
subject property since after the death of Isidra Santos on April 1, 1967. Thereafter, Philip Santos took
possession of the subject property on December 16, 1980 upon its sale on said date. They reason out that
more than 13 years had lapsed from April 1, 1967 to December 16, 1980; and that more than 12 years had
lapsed from the time Philip Santos took possession of the property on December 16, 1980 up to the time
Ladislao Santos filed the action for partition on May 13, 1993. Petitioners conclude that the instant action is
already barred by ordinary acquisitive prescription of ten years. Further, it is argued that the possession of
Virgilio Santos could be tacked with the possession of Philip Santos bringing to a total of 26 years the time that
elapsed before the filing of the case in 1993. They add that these 26 years of inaction call for the application of
the principle of estoppel by laches.

Considering that there was no proof that Ladislao Santos executed any "Combined Deed of Partition" in
tandem with the Eliseo Santos, we rule that a co-ownership still subsists between the brothers over the Isidra
property. This being the case, we apply Article 494 of the Civil Code which states that, "prescription does not
run in favor of a co-owner or co-heir against his co-owners or his co-heirs so long as he expressly or impliedly
recognizes the co-ownership." In Adile vs. Court of Appeals,14 it was held:

"x x x. Prescription, as a mode of terminating a relation of co-ownership, must have been preceded by
repudiation (of the co-ownership). The act of repudiation, in turn, is subject to certain conditions: (1) a co-owner
repudiates the co-ownership; (2) such an act of repudiation is clearly made known to the other co-owners; (3)
the evidence thereon is clear and conclusive; and (4) he has been in possession through open, continuous,
exclusive, and notorious possession of the property for the period required by law."

There is no showing that Eliseo Santos had complied with these requisites. We are not convinced that Eliseo
1âwphi 1

had repudiated the co-ownership, and even if he did, there is no showing that the same had been clearly made
known to Ladislao. As aptly observed by the Court of Appeals:

"Under Article 1119 of the New Civil Code, acts of possessory character executed in virtue of license or
tolerance of the owners shall not be available for the purposes of possession.

Indeed, Filipino family ties being close and well-knit as they are, and considering that Virgilio Santos was the
ward of Isidra Santos ever since when Virgilio Santos was still an infant, it was but natural that the Appellant did
not interpose any objection to the continued stay of Virgilio Santos and his family on the property and even
acquiesce thereto. Appellant must have assumed too, that his brother, the Appellee Eliseo Santos, allowed his
son to occupy the property and use the same for the time being. Hence, such possession by Virgilio Santos
and Philip Santos of the property does not constitute a repudiation of the co-ownership by the Appellee Eliseo
Santos and of his privies for that matter. As our Supreme Court succinctly observed:

"x x x [A]nd it is probable that said conduct was simply tolerated by the plaintiffs on account of his being their
uncle, and they never thought that by said conduct the defendant was attempting to oust them forever from the
inheritance, nor that the defendant would have so intended in any way, dealing as we do here with the
acquisition of a thing by prescription, the evidence must be so clear and conclusive as to establish said
prescription without any shadow of doubt. This does not happen in the instant case, for the defendant did not
even try to prove that he has expressly or impliedly refused plaintiff’s right over an aliquot part of the
inheritance. (at page 875, supra)"15

Penultimately, the action for partition is not barred by laches. An action to demand partition is imprescriptible or
cannot be barred by laches. Each co-owner may demand at any time the partition of the common property. 16

As a final note, it must be stated that since Ladislao has successfully hurdled the issue of co-ownership of the
property sought to be partitioned, there is the secondary issue of how the property is to be divided between the
two brothers.17 This Court cannot proceed forthwith with the actual partitioning of the property involved, hence,
we reiterate the order of the Court of Appeals for the trial court to effect the partition of the subject property in
conformity with Rule 69 of the 1997 Rules of Civil Procedure.

WHEREFORE, the decision of the Court of Appeals is AFFIRMED in toto.


G.R. No. 170080 April 4, 2007

CONSOLACION Q. AUSTRIA, Petitioner,


vs.
CONSTANCIA Q. LICHAUCO, CONSUELO Q. JALANDONI, JOSE ALBERTO L. QUINTOS, RICARDO M.
QUINTOS, JR., AILEEN M. QUINTOS and TYRONE M. QUINTOS, Respondents.

DECISION

TINGA, J.:

Petitioner Consolacion Q. Austria assails the Decision1 of the Court of Appeals in C.A. G.R. CV No. 68591
dated June 21, 2005 and its Resolution2 dated October 7, 2005, which respectively affirmed the decision3 of the
Regional Trial Court of Makati City, Branch 142, dated February 14, 2000 and its order4 dated August 7, 2000,
and denied petitioner’s motion for reconsideration.

The facts as narrated by the Court of Appeals are as follows:

Plaintiffs-appellees Constancia Lichauco, Consuelo Jalandoni, defendants Benedicto Quintos and Antonio
Quintos, and defendant-appellant Consolacion Austria are siblings of full blood. Jose Alberto, Ricardo, Jr.,
Aileen and Tyrone, all surnamed Quintos, are the nephews and niece of the defendant-appellant.

The above-named persons are co-owners of two (2) parcels of land with an aggregate area of six hundred sixty
one (661) square meters located in Palanan, Makati City. The aforesaid parcels of land have permanent
improvements thereon which straddle both lots, namely, a residential bungalow and two (2) units, two-storey
apartments, the titles of which are registered jointly in the names of the parties as co-owners thereof.

The plaintiffs-appellees allege that sometime in the early part of 1996, they informed defendant-appellant of
their desire to have the subject properties partitioned based on the percentage of each co-owner’s respective
share.

A realtor was even engaged to prepare the schemes by which the subject properties could be physically
partitioned among the co-owners. However, the defendant-appellant Austria refused to accede to any of the
schemes presented by the realtor for the physical apportionment of the subject properties between the co-
owners thereof.

Because of the refusal of the defendant-appellant Austria to partition the property, and the inability of the co-
owners to mutually agree on an arrangement acceptable to all of them, on July 1, 1997, the plaintiffs-appellees
filed a complaint with the Regional Trial Court of Makati City, Branch 142, which was docketed as Civil Case
No. 97-1485, against the defendant-appellant Austria and two other defendants namely Benedicto Quintos and
Antonio Quintos (as unwilling co-plaintiffs) for partition of the subject property.

Within the period for filing an answer, the defendant-appellant Austria filed an Omnibus Motion to Dismiss.

In its order dated November 10, 1997, the lower court denied the omnibus motion to dismiss of the defendant-
appellant Austria, and directed the defendants to file their answer within the remaining period provided by the
Rules.

Within the prescriptive period, the defendant-appellant Austria filed a Motion for Reconsideration of the
November 10, 1997 order, which the lower court denied in an order dated February 2, 1998.

Not satisfied, the defendant-appellant Austria filed before the Court of Appeals a Petition for certiorari and
prohibition under Rule 65 of the Revised Rules of Court which was docketed as CA-GR SP No. 46907, seeking
to annul the orders of November 10, 1997 and February 2, 1998.
In a Resolution dated July 9, 1998, the Court of Appeals required the plaintiffs-appellees to comment, and
temporarily restrained the respondent judge, his agents, representatives, and other persons acting in his behalf
from proceeding with Civil Case No. 97-1485 in order that the petition may not become moot and academic.

On November 9, 1998, the defendant-appellant Austria received a copy of the Decision dated October 30, 1998
dismissing her petition for certiorari and prohibition. The defendant-appellant Austria moved for the
reconsideration thereof.

Subsequently, on July 19, 2001, defendant-appellant Austria received a copy of the Resolution of the Court of
Appeals dated July 9, 2001, denying her motion for reconsideration of the decision denying her petition for
certiorari and prohibition.

Undaunted, the defendant-appellant Austria then filed a petition for review under Rule 45 of the Revised Rules
of Court with the Supreme Court.

In a resolution dated October 15, 2001, the Supreme Court denied the said petition for review for non-
compliance with the 1997 Rules of Civil Procedure for failure to pay on time docket and other fees and deposit
costs in violation of Sec. 3, Rule 45 in relation to Sec. 5(c), Rule 56.

Still not satisfied, on November 9, 2001, the defendant-appellant Austria filed a motion for reconsideration of
the resolution dated October 15, 2001 denying her petition for review.

In its resolution dated January 24, 2002, the Supreme Court denied with finality the petitioner’s motion for
reconsideration.

During the pendency of the defendant-appellant’s petition for certiorari and prohibition before the Court, the
plaintiffs-appellees filed with the Regional Trial Court of Makati City, Branch 142 where the main case is
pending, a motion dated April 6, 1998 praying that a declaration of default be issued against all defendants and
for plaintiffs to be allowed to present evidence ex-parte.

In an order dated July 13, 1998, the Presiding Judge of the Regional Trial Court of Makati City held in
abeyance the proceedings before it while awaiting the resolution of the motion for reconsideration pending
before the Court of Appeals.

Notwithstanding the order holding in abeyance the proceedings in the lower court, plaintiffs-appellees filed a
Manifestation and Motion dated September 14, 1998 praying for the resolution of their Motion dated April 6,
1998. In its order dated September 25, 1998, the lower court deemed the incident submitted for resolution.

While the motion for reconsideration filed by the appellant is still pending before the Court of Appeals, the lower
court in its order dated July 6, 1999 declared the defendants in default, set the reception of ex-parte evidence,
and commissioned the Branch Clerk of Court to receive the ex-parte evidence and to submit her corresponding
report thereon as soon as the same is concluded.

On On August 4, 1999, the defendant-appellant Austria filed a Motion for Reconsideration of the Order dated
July 6, 1999 with an urgent prayer to cancel plaintiff’s ex parte presentation of evidence on August 9,
1999, which was however denied by the lower court, for lack of merit, in an order dated January 14, 2000.

The plaintiffs-appellees then presented their evidence ex-parte on January 28, 2000.

The assailed decision was subsequently rendered by the lower court on February 14, 2000, finding in favor of
the plaintiffs-appellees.

A motion for new trial was thereafter filed by the defendant-appellant Austria, which was, in an order dated
August 7, 2000, denied for lack of merit.5
Petitioner elevated the case to the Court of Appeals which dismissed her petition and affirmed the trial court’s
decision but deleted the order that petitioner pay reasonable rental for her use of a portion of the disputed
properties. The appellate court denied reconsideration.

In assailing the Decision of the Court of Appeals, petitioner avers that her motion for new trial and appeal of the
judgment by default are valid remedies under the Rules of Court. She insists that the appellate court erred in
not reversing the declaration of default despite the fact that she questioned the default order in the petition for
review which she seasonably filed with the Court of Appeals. Petitioner also contends that it was error for the
trial court to allow the sale of the entire property in dispute.

Respondents filed a Comment6 dated March 30, 2006, arguing that petitioner was correctly declared in default
because of her obstinate refusal to file an answer to the complaint despite being ordered to do so by the trial
court. They also allege that they cannot be compelled to remain in co-ownership only because of petitioner’s
unjustified refusal to consent to a partition.

A Reply to Comment7 dated July 25, 2006 was filed by petitioner who insisted that she was denied the right to
fully ventilate her case.

Only two issues are raised in this petition. The first issue pertains to petitioner’s insistence that the judgment by
default rendered by the trial court, which was subsequently affirmed by the Court of Appeals, is a denial of her
day in court. The second issue concerns the validity of the trial court’s decision alternatively ordering the
partition of the subject property or authorizing its sale.

A defendant declared in default has the following remedies: (a) a motion to set aside the order of default under
Sec. 3(b), Rule 9 of the Rules of Court; (b) a motion for new trial under Sec. 1(a), Rule 37 if the default was
discovered after judgment but while appeal is still available; (c) a petition for relief under Rule 38 if judgment
has become final and executory; and (d) an appeal from the judgment under Sec. 1, Rule 41 even if no petition
to set aside the order of default has been resorted to.8

In this case, petitioner did not move to set aside the order of default rendered by the trial court but filed a
motion for new trial after a decision had already been rendered in the case. The motion for new trial, however,
was denied by the trial court for lack of merit. She then appealed to the Court of Appeals, assailing both the
denial of her motion for new trial and the adverse decision of the trial court.

Evidently, petitioner utilized the appropriate remedies available to her. The fact, however, that she availed of
the proper remedies does not by itself result in a judgment in her favor or the reversal of the assailed order and
decision of the trial court. As correctly ruled by the Court of Appeals, petitioner was declared in default because
of her adamant refusal to file an answer despite being required to do so.

The factual circumstances in the cases of Heirs of Akut v. Court of Appeals9 and Ampeloquio v. Court of
Appeals,10cited by petitioner in pleading liberality, are markedly different from this case. In Heirs of
Akut, petitioners were not able to file an answer within the reglementary period because they failed to obtain
the services of counsel on time and two of the petitioners were then sick. In Ampeloquio, the trial court’s order
denying defendant’s motion to dismiss was mistakenly served upon one of its counsels on record and not upon
the lawyer in charge of the case. Consequently, the answer was not filed on time. In both cases, there was no
indication that the failure to answer was intended to delay the case.

In contrast, the facts of this case suggest an intention on the part of petitioner to delay the proceedings. The
complaint was first filed in 1997 but is only now being finally laid to rest because of several procedural
stumbling blocks, including the elevation of the case to this Court on the issue of the propriety of the trial court’s
denial of petitioner’s motion to dismiss, hurled by petitioner one after the other.

Parenthetically, the appellate court initially issued a temporary restraining order as an incident to the petition for
certiorari filed by petitioner questioning the trial court’s order denying her motion to dismiss but the restraining
order was lifted after its 60-day validity.11 The expiration of the temporary restraining order resulted in the
running of the prescribed period to file an answer and the continuation of the proceedings before the trial court.
Petitioner’s obstinate refusal to file an answer to the complaint despite these circumstances clearly justifies the
declaration of default by the trial court and its affirmation by the Court of Appeals.

This case has crept, ever so slowly, up the ladder of judicial process. While we are not dissuading parties from
availing of the judicial remedies outlined in the Rules of Court, they should be cautioned to be judicious in
availing of these remedies. After all, rules of procedure are intended to be, not tools of delay, but of prompt and
just disposition of every party’s cause. Having fully availed of, even exploited, these remedies, petitioner cannot
feign denial of her day in court. She has been given every opportunity to fully ventilate her side.

Now, we turn to the second issue raised by petitioner, i.e., the validity of the trial court’s decision alternatively
directing the partition of the subject properties or authorizing their sale to a third party.

There are two stages in every action for partition. The first phase is the determination of whether a co-
ownership in fact exists and a partition is proper, i.e., not otherwise legally proscribed, and may be made by
voluntary agreement of all the parties interested in the property. This phase may end either: (a) with a
declaration that plaintiff is not entitled to have a partition either because a co-ownership does not exist, or
partition is legally prohibited; or (b) with a determination that a co-ownership does in truth exist, partition is
proper in the premises, and an accounting of rents and profits received by the defendant from the real estate in
question is in order. In the latter case, the parties may, if they are able to agree, make partition among
themselves by proper instruments of conveyance, and the court shall confirm the partition so agreed upon.12

The second phase commences when it appears that the parties are unable to agree upon the partition directed
by the court. In that event, partition shall be done for the parties by the court with the assistance of not more
than three (3) commissioners. This second stage may well also deal with the rendition of the accounting itself
and its approval by the court after the parties have been accorded opportunity to be heard thereon, and an
award for the recovery by the party or parties thereto entitled of their just share in the rents and profits of the
real estate in question.13

The proceedings in this case have only reached the first phase. It must be mentioned as an aside that even if
the order decreeing partition leaves something more to be done by the trial court for the complete disposition of
the case, i.e., the appointment of commissioners, the proceedings for the determination of just compensation
by the appointed commissioners, the submission of their reports and hearing thereon, and the approval of the
partition, it is considered a final order and may be appealed by the party aggrieved thereby.14

There is no question that a co-ownership exists between petitioner and respondents. To this extent, the trial
court was correct in decreeing partition in line with the Civil Code provision that no co-owner shall be obliged to
remain in the co-ownership.15

However, the trial court went astray when it also authorized the sale of the subject properties to a third party
and the division of the proceeds thereof. What makes this portion of the decision all the more objectionable is
the fact that the trial court conditioned the sale upon the price and terms acceptable to plaintiffs (respondents
herein) only, and adjudicated the proceeds of the sale again only to plaintiffs. The pertinent portion of the trial
court’s disposition states:

WHEREFORE, on the basis of the foregoing considerations, judgment is hereby rendered in favor of plaintiff:

1) Directing the partition (physical division) of the subject properties and all improvements thereon
among the co-owners in accordance with their respective shares; or

2) Authorizing the sale, conveyance or transfer of the above-described properties to a third-party at


such price and under such terms acceptable to plaintiffs and thereafter, dividing the proceeds
of said sale among them in accordance with their proportionate interests.16 [Emphasis supplied.]

It is true that petitioner did not assign this error on appeal resulting in the appellate court’s failure to rule on the
matter. Nonetheless, we cannot simply brush this issue aside considering that its resolution is necessary in
arriving at a just disposition of the case.17 The rectification of the trial court’s decision is accordingly in order.
WHEREFORE, the petition is GRANTED IN PART. The Decision of the Court of Appeals dated June 21, 2005
is REVERSED in so far as it affirms the portion of the decision dated February 14, 2000 of the Regional Trial
Court of Makati City, Branch 142, which authorizes the sale, conveyance or transfer of the properties subject of
this case and the division of the proceeds of said sale to respondents herein. The Decision dated June 21,
2005 and Resolution dated October 7, 2005 are AFFIRMED in all other respects. No pronouncement as to
costs.
G.R. No. 169356 August 28, 2007

CARMEN FANGONIL - HERRERA, Petitioner,


vs.
TOMAS FANGONIL, PURA FANGONIL TINO, MARINA FANGONIL, MARIANO FANGONIL, MILAGROS
FANGONIL-LAYUG and VICTORIA FANGONIL ESTOQUE,1 Respondents.

DECISION

CHICO-NAZARIO, J.:

In this instant Petition for Review under Rule 45 of the Revised Rules of Court, petitioner assails the (a)
Decision issued by the Court of Appeals dated 30 January 2004 in CA-G.R. CV No. 61990, and (b) the
Resolution of the same Court dated 15 July 2005 denying petitioner’s Motion for Reconsideration. Petitioner
urges this Court to modify the assailed Decision of the Court of Appeals which affirmed the Decision dated 9
October 1998 of the Regional Trial Court (RTC) of Agoo, La Union, Branch 31 in Special Proceedings Case
No. A-806 for Judicial Partition. The petition prays that the two parcels of land, one located in Magsaysay,
Tubao, La Union, more particularly described as:

A parcel of rice land which the middle portion (15,364 sq. m) has been included and situated in Barrio Lloren,
Tubao, La Union, declared under Tax Dec. Number 2889. Bounded on the North, by the property of Manuel
Ordoña; on the East, by the property of Severino Padilla, Nicolas Caniero, and Heirs of V. Selga; on the South,
by the properties of Manuel Ordoña and Francisco Padilla; and on the West, by a river; containing an area of
more than two hectares; x x x.2

and the other in San Nicholas East, Agoo, La Union, designated as:

A parcel of unirrigated rice land without permanent improvements, situated in Barrio San Nicolas, Agoo, La
Union with an area of 10,777 sq. m. (1 Ha. 1,777 sq. m.) more or less, visible by signs of pilapiles around its
perimeter, assessed at ₱400.00, declared for tax purposes in my name under Tax Declaration Number 6373,
and bounded-on the North, by Donato Eslao; on the East, by the Heirs of Flaviano Fangonil, and others; on the
South, by Eulalio Fangonil; and on the West, by the heirs of Remgio Boado; x x x.3

be adjudged solely to petitioner to the exclusion of respondents. In addition, petitioner requests that another
parcel of land located in Poblacion, Tubao, La Union, be divided in accordance with the manner she proposes.

The following are the antecedent facts:

Petitioner and respondents4 are children of the late Fabian Fangonil and Maria Lloren Fangonil5 of Tubao, La
Union. The Fangonil spouses had 7 children: Tomas, Pura, Marina, Mariano, Milagros, Sinforoso, and Carmen.
Fabian died on 1 June 1953, while Maria Lloren died on February 1976. The spouses died intestate, leaving an
estate consisting of 7 parcels of land herein specified:

Parcel 1 – a 1,800 square meter residential land located at Poblacion, Tubao, La Union, which is facing the
Town Plaza;

Parcel 2 – a 922 square meter residential lot located at Barangay Sta. Barbara, Agoo, La Union;

Parcel 3 – a 54,759 square meter agricultural land located at Francia West, Tubao, La Union;

Parcel 4 – an 84,737 square meter agricultural land located at Francia West, Tubao, La Union;

Parcel 5 – a 5,821 square meter parcel of agricultural land located at Francia Sur, Tubao, La Union;
Parcel 6 – a 17,958 square meter parcel of agricultural land located at Magsaysay, Tubao, La Union;

Parcel 7 – 9,127 square meter parcel of agricultural land located at San Nicolas East, Agoo, La Union.

The only remaining heirs are the 7 children. Prior to an extrajudicial settlement executed by the heirs in 1983,
there was never any settlement of the estate. The parties do not dispute that the succeeding transactions
involving parcels 6 and 7 took place. Fabian Fangonil, with the consent of Maria Lloren Fangonil, obtained a
loan secured by a mortgage over a 15,364 square meter middle portion of the sixth parcel of land for
₱1,450.00, executed under a Deed of Mortgage6 in favor of Francisca Saguitan on 20 April 1949. A portion of
the sixth parcel, with an area of 4,375 square meters, was sold with a right to repurchase to a certain
Constantino Oribello for ₱1,450.00 on 15 December 1953. The transaction was under an agreement
designated as a Deed of Pacto de Retro Sale7 between Maria Lloren Fangonil, who was a widow by then, and
Constantino Oribello. On the other hand, the seventh parcel of land was sold, with a right to repurchase, by
Fabian Fangonil to Quirino Estacio under an agreement denominated as Deed of Sale with Pacto de Retro8 on
12 December 1949 for ₱2,600.00. The total amount received by the Fangonil spouses for the properties was
₱5,500.00.

The parcels above-mentioned were never repurchased or redeemed by the Fangonil spouses. Prior to
foreclosure, the portion of the sixth parcel covered by a Deed of Mortgage was released from the mortgage on
20 April 1956 upon petitioner’s payment of ₱1,950.00 to Francisca Suguitan. The portion of the sixth parcel
covered by the Deed of Pacto de Retro Sale was repurchased on 16 October 1956 upon petitioner’s payment
of ₱1,550.00 to Constantino Oribello. On the other hand, the seventh parcel subject of the Deed of Sale with
Pacto de Retro was repurchased by petitioner on 13 November 1959 upon the payment of ₱2,600.00 to
Quirino Estacio. Petitioner paid the total amount of ₱6,100.00 for the redemption of parcels 6 and 7.

On 14 November 1983, the parties executed an Extrajudicial Settlement and Partial Partition of the estate of
the Fangonil spouses covering the seven parcels of land. Although petitioner signed the extrajudicial
settlement, she refused to accede to the proposed manner of partition of parcel 1. Thereafter, all the heirs
concerned, except petitioner, executed a joint affidavit dated 19 December 1994, stipulating on the partition of
parcel 1. On 2 February 1995 or 11 years after the execution of the extrajudicial settlement, petitioner executed
an affidavit9 refuting the portions pertaining to parcels 6 and 7, on the ground that her late brother Sinforoso
Fangonil who was a Regional Trial Court (RTC) Judge then, committed misrepresentation and convinced her to
sign the said settlement.

On 1 March 1995, six of the seven children of the Fangonil spouses, excluding herein petitioner, filed
with the RTC a petition for judicial partition of the seven parcels of land, with prayer for appointment of
Marina Fangonil as administratrix. The case was docketed as Special Proceedings Case No. A-806.
Petitioner intervened before the trial court to oppose the petition. She likewise prayed that she be
appointed administratrix, claiming exclusive ownership over parcels 6 and 7.

The parties agreed to submit the case for decision based on the pleadings, considering there was no
disagreement as to the manner of sharing Parcels 2, 3, 4, and 5 of the estate. In addition, on 16
September 1996, the respondent heirs deposited in court ₱7,453.0010 as payment to petitioner and her
brother Tomas Fangonil as the only outstanding debtors of the estate as specified in the 14 November
1983 extrajudicial settlement. On 2 September 1998, respondents, through counsel, submitted a
Manifestation/Motion dated 31 August 1998, proposing a manner of computation for repayment to
petitioner, the pertinent portions of which read:

3. That the currency rate of the Philippine Peso to the U.S. Dollar on November 13, 1959 is ₱3.90 to
U.S. $1.00;

4. That the currency rate of the Philippine Peso to the U.S. Dollar as of this date August 31, 1998 is
₱42.00 to U.S. $1.00;

5. So that the amount of indebtedness of ₱6,100.00 on November 13, 1959 has now the equivalent of
₱65,790.00 as of 31 August 1998;
5.1 The equivalent amount of ₱65,790.00 shall be proportionately paid by all the heirs with each and
every heir having a share in said indebtedness in the amount of ₱9,398.57;11

On 7 October 1998, the RTC issued an Order generally approving the manifestation/motion except for the
computation, modifying the amount to ₱138,100.00 as the present equivalent of the amount of ₱6,100.00
previously paid by petitioner to redeem parcels 6 and 7. In its Decision12 dated 9 October 1998, the RTC ruled
in favor of respondents herein and declared parcels 6 and 7 as part of the estate of the spouses Fangonil to be
partitioned and ordered the partition of parcel 1 based on the manner proposed by respondents. It ordered the
payment of the estate debt to petitioner and her brother in the amount of ₱138,100.00, the money equivalent of
the ₱6,100.00 paid by her at the time of redemption of parcels 6 and 7. The dispositive portion of the decision
reads:

WHEREFORE, upon the foregoing premises, this court hereby adjudicates and partitions the inherited
properties, including the controversial parcels 6 and 7, in accordance with the following:

FIRST PARCEL

xxxx

This is divided into two (2) segments, the Eastern Portion and Western Portion.

The Eastern Portion shall belong to three (3) heirs, namely Tomas Fangonil, Sinforoso Fangonil represented by
Victoria Estoque and Marina Fangonil. The Western Portion shall belong to two (2) heirs, the Southwestern part
belongs to Pura F. Tino and the Northwestern part belongs to Carmen Fangonil Herrera x x x.

SECOND PARCEL

xxxx

This parcel goes to Mariano Fangonil and Milagros Fangonil Layug.

THIRD PARCEL

xxxx

A drawing of lots was conducted on April 25, 1997 with respect to parcel 3. Parcel 3 was divided into seven by
Geodetic Engineer Gerardo Dacayanan. The result was the following (see also, Order dated April 25, 1997,
page 166, Record of the case):

Lot 1 (A) – Milagros F. Layug

Lot 2 (B) – Tomas Fangonil

Lot 3 (C) – Mariano Fangonil

Lot 4 (D) – Pura F. Tino

Lot 5 (E) – Sinforoso Fangonil

Lot 6 (F) – Carmen F. Herrera

Lot 7 (G) – Marina Fangonil


xxxx

FOURTH PARCEL

xxxx

The same thing happened. There was a drawing of lots. The result was the following:

Lot 1 (A) – Marina Fangonil

Lot 2 (B) – Carmen F. Herrera

Lot 3 (C) – Tomas Fangonil

Lot 4 (D) – Sinforoso Fangonil

Lot 5 (E) – Milagros F. Layug

Lot 6 (F) – Pura F. Tino

Lot 7 (G) – Mariano Fangonil

xxxx

FIFTH PARCEL

xxxx

On May 2, 1997, the drawing of lots on Parcel 5 was conducted. The result was as follows:

Lot 1 – Pura F. Tino

Lot 2 – Marina Fangonil

Lot 3 – Milagros F. Layug

Lot 4 – Sinforoso Fangonil

Lot 5 – Carmen F. Herrera

Lot 6 – Mariano Fangonil

Lot 7 – Tomas Fangonil

SIXTH PARCEL

xxxx

On August 27, 1998, the drawing of lots was conducted with respect to the controversial parcels, the sixth
parcel and the seventh parcel. The result on the sixth parcel was as follows:

Lot 1 – Pura F. Tino


Lot 2 – Sinforoso Fangonil

Lot 3 – Tomas Fangonil

Lot 4 – Marina Fangonil

Lot 5 – Carmen F. Herrera (boycotted the draw)

Lot 6 – Mariano Fangonil

Lot 7 – Milagros F. Layug

xxxx

SEVENTH PARCEL

xxxx

The draw was made on the same day, August 27, 1998. Just like in the drawing of lots for the Sixth Parcel,
Carmen F. Herrera boycotted the draw. Hence, the Court ruled that since there are seven rolled papers for the
seven heirs to draw, the last undrawn rolled-paper containing the lot number shall be for Carmen Herrera. The
result for the draw for the seventh parcel was as follows:

Lot 1 – Carmen Herrera

Lot 2 – Tomas Fangonil

Lot 3 – Milagros F. Layug

Lot 4 –Marina Fangonil

Lot 5 – Sinforoso Fangonil

Lot 6 – Mariano Fangonil

Lot 7 – Pura F. Tino

It should be noted that after the draws on August 27, 1998, Atty. Baltazar, counsel for [respondents],
manifested that he will file a motion as regards the accounting of the produce of the sixth and seventh parcels.
However, what he filed was the Manifestation/Motion dated August 31, 1998.

The six heirs (excluding Carmen F. Herrera) shall reimburse the amount of ₱138,100.00, each one contributing
the amount of ₱19,728.57, to Carmen F. Herrera. Since the other six heirs did not insist on the accounting of
the produce with respect to parcels 6 and 7, Carmen F. Herrera does not have to render an accounting. As a
matter of fact, this Court, in its Order dated October 7, 1998, considered the produce of the said two (2)
parcels, which she appropriated from the ‘50s to the present as interest on her money.13

Petitioner appealed the above RTC Decision to the Court of Appeals, alleging the unfair and prejudicial manner
of partition of parcel 1 and claiming exclusive ownership over parcels 6 and 7. The Court of Appeals denied the
appeal in its Decision promulgated 30 January 2004, the dispositive portion of which reads:

WHEREFORE, the October 9, 1998 Decision of the Regional Trial Court of Agoo, La Union, Branch 31, in
Special Proceeding Case No. A-806, is AFFIRMED in toto."14
Under said decision, the Court of Appeals affirmed in toto the findings of the trial court, pronouncing that
petitioner failed to adduce any evidence that would support her claim that the distribution was not equal and
prejudicial to her interest. It concurred with the trial court in concluding that, at the most, she is only entitled to
the reimbursement of the amount she spent for redemption of the questioned lots in an amount equivalent to
what her money commanded then, stating that petitioner is simply holding the said property in trust for the other
co-heirs. At the same time, it upheld the trial court’s finding on the equivalent of the money which petitioner
paid to redeem and repurchase parcels 6 and 7, but the dispositive portion merely indicated the amount of
₱130,100.00.

Petitioner filed a Motion for Reconsideration of the 30 January 2004 Decision which the Court of Appeals
denied in a Resolution dated 15 July 2005. Dissatisfied with the final resolution of the Court of Appeals on the
matter, petitioner now comes before this Court via a Petition for Review under Rule 45 of the Revised Rules of
Court. Petitioner insists she is the exclusive owner of parcels 6 and 7 and rejects the partition of parcel 1 as
being unequal and prejudicial, raising the following issues:

I.

THE RESPONDENT COURT GRAVELY ERRED IN SUSTAINING THE MANNER IN WHICH


PARCEL 1 IS TO BE PARTITIONED BASED ON THE PRIVATE RESPONDENTS’ POSITION WHICH
IS CLEARLY UNEVEN AND UNFAIR TO THE PETITIONER WHOSE SHARE WILL THEN BE
FOUND AT THE REAR PORTION OF THE SAID LOT.

II.

THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN NOT HOLDING THAT PARCELS 6
AND 7 SHALL BE OWNED SOLELY AND EXCLUSIVELY BY THE PETITIONER BEING THE ONLY
ONE WHO REDEEMED AND REPURCHASED SAID PARCELS IN THE 1950’S EVEN WHILE THE
PARENTS OF THE PARTIES WERE STILL ALIVE.

III.

THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN NOT HOLDING THAT THE
PRIVATE RESPONDENTS’ RIGHT TO CLAIM A SHARE IN PARCELS 6 AND 7 HAD LONG
PRESCRIBED AS A RESULT OF THEIR INACTION FOR MORE THAN FORTY (40) YEARS WHERE
THEY ALLOWED THE PETITIONER TO EXERCISE FULL OWNERSHIP OVER SAID PARCELS,
EVEN ASSUMING WITHOUT ADMITTING THAT AT FIRST, THEY HAVE THE RIGHT TO REDEEM
THE SAID PARCELS.

IV.

THE HONORABLE COURT OF APPEALS GRAVELY ERRED IN NOT HOLDING THAT THE
PRIVATE RESPONDENTS’ RIGHT TO CLAIM A SHARE IN PARCELS 6 AND 7 HAD LONG BEEN
BARRED BY LACHES AS A RESULT OF THEIR INACTION FOR MORE THAN FORTY (40) YEARS
WHERE THEY ALLOWED THE PETITIONER [TO] EXERCISE FULL OWNERSHIP OVER SAID
PARCELS, EVEN ASSUMING WITHOUT ADMITTING THAT AT FIRST, THEY HAVE THE RIGHT TO
REDEEM THE SAID PARCELS.

V.

THE TRIAL COURT GRAVELY ERRED IN HOLDING THAT THE MONEY EQUIVALENT OF THE
MONEY OF THE OPPOSITOR-APPELLANT WHICH SHE USED TO REPURCHASE AND REDEEM
PARCELS 6 AND 7 IN THE 1950’S WOULD ONLY BE P138,100.00 IN TODAY’S MONEY, EVEN
ASSUMING WITHOUT ADMITTING THAT THE SAID PARCELS COULD BE REDEEMED BY THE
ESTATE OF FABIAN AND MARIA LLOREN.15
Petitioner’s arguments are fallacious.

With respect to procedural matters, respondents argue that the petition is a combination of an appeal via a
petition for review on certiorari under Rule 45 and an independent civil action of certiorari under Rule 65 of the
Revised Rules of Court. This is based on the observation that petitioner impleaded the Court of Appeals as one
of the respondents while at the same time raising issues of fact alone. Respondents posit that these are
indicative of an "intention to categorize the petition to be under both Rules 65 and 45 of the Rules of Court" and
should be dismissed outright. Although petitioner erroneously impleaded the Court of Appeals as one of the
respondents, petitioner clearly and rightly invoked Rule 45 of the Revised Rules of Court as the remedy availed
of. As we held in National Irrigation Administration v. Court of Appeals,16 the appeal from a final disposition of
the Court of Appeals is a petition for review under Rule 45 and not a special civil action under Rule 65 of the
Revised Rules of Court. Under Rule 45 of the Revised Rules of Court, decisions, final orders or resolutions of
the Court of Appeals, regardless of the nature of the action or proceedings involved, may be appealed to us by
filing a petition for review, which would be but a continuation of the appellate process over the original
case.17 The correct procedure is not to implead the Court of Appeals. This Court has ruled in several instances
that where the Court of Appeals is impleaded as respondent in the Petition for Review, and the petition clearly
invokes Rule 45, the Court of Appeals is merely omitted from the title of the case pursuant to Sec. 4(a) of Rule
45 of the Revised Rules of Court.18 The Court of Appeals is herein omitted from the title of the case, as a liberal
interpretation of the rules on technicality, in pursuit of the ends of justice and equity. 19

We now discuss respondents’ contention that only factual issues have been brought to this Court.

Under Section 1, Rule 45, providing for appeals by certiorari before the Supreme Court, it is clearly enunciated
that only questions of law may be set forth.20 Questions of fact may not be raised unless the case falls under
any of the following exceptions21 :

(1) when the findings are grounded entirely on speculation, surmises, or conjectures; (2) when the inference
made is manifestly mistaken, absurd, or impossible; (3) when there is grave abuse of discretion; (4) when the
judgment is based on a misapprehension of facts; (5) when the findings of fact are conflicting; (6) when in
making its findings the Court of Appeals went beyond the issues of the case, or its findings are contrary to the
admissions of both the appellant and the appellee; (7) when the findings are contrary to those of the trial court;
(8) when the findings are conclusions without citation of specific evidence on which they are based; (9) when
the facts set forth in the petition as well as in the petitioner’s main and reply briefs are not disputed by the
respondent; and (10) when the findings of fact are premised on the supposed absence of evidence and
contradicted by the evidence on record.

In this particular instance, we are clearly faced with issues of fact. A question of fact is involved when the doubt
or difference arises as to the truth or falsehood of alleged facts or when the query necessarily invites calibration
of the whole evidence, considering mainly the credibility of witnesses, existence and relevance of specific
surrounding circumstances, their relation to each other and to the whole, and the probabilities of the
situation.22 We find that the only questions to be resolved are the following: (a) whether or not the respondent
court gravely erred in affirming the partition of parcel 1 in accordance with the findings of the trial court; and (b)
whether or not the respondent court gravely erred in not finding that exclusive ownership of the properties in
question has been vested in petitioner.

In the exercise of the Supreme Court’s power of review, this Court is not a trier of facts, and unless there are
excepting circumstances, it does not routinely undertake the re-examination of the evidence presented by the
contending parties during the trial of the case.23 Factual matters are beyond the jurisdiction of this Court.24 In
petitions for review on certiorari under Rule 45 of the Revised Rules of Court, this Court is limited to reviewing
only errors of law, not of fact, unless the factual findings complained of are devoid of support by the evidence
on record or the assailed judgment is based on a misapprehension of facts. As held in Philippine Airlines, Inc.
v. Court of Appeals,25 factual findings of the Court of Appeals are conclusive26 on the parties and carry even
more weight when the said court affirms the factual findings of the trial court.27 Absent any palpable error or
arbitrariness, the findings of fact of the lower court are conclusive. On this ground alone, the appeal warrants a
dismissal.
Setting aside the procedural defects, the appeal must fail based on the merits. Upon perusal of the records of
the case, it is evident to this Court that no cogent reason exists to disturb the decision of the Court of Appeals.

Petitioner contends that the manner of partition of parcel 1 by the RTC, as affirmed by the Court of Appeals, is
unfair and prejudicial to her interest. However, she was not able to adduce substantial evidence aliunde to
support her allegations. Respondents stress that the Fangonil spouses appropriated portions of Parcel 1 to
Carmen, Pura, Tomas, Marina, and Sinforoso, by pointing out specific areas pertaining to each. Carmen,
Tomas, and Marina built their houses on parcel 1. Prior to the order of partition, an ocular inspection of parcel 1
was conducted by the RTC to determine which manner of partition it would approve. During said ocular
inspection, however, the RTC saw existing structures upon which the homes of Carmen, Tomas, Marina, and a
store of Carmen were situated. The arrangement was allegedly based on their oral agreement. This same
arrangement allotting an equal area of 362 square meters to each of the heirs was made the basis of the
manner of partition proposed by respondents and later on approved by both the RTC and Court of Appeals.

Anent the rights of the parties pertaining to parcels 6 and 7, petitioner insists that her act of paying for the
repurchase and release from mortgage of parcels 6 and 7 was on the understanding with her parents that she
would thereafter be the owner thereof. She asserts that her exercise of acts of ownership over parcels 6 and 7,
to the exclusion of her parents and siblings, reveals she is the exclusive owner of these lots. She cites several
circumstances in support of her contention that respondents never considered parcels 6 and 7 part of the
estate of their parents and are not co-owners thereof. First, petitioner presented real estate tax receipts
indicating that she had been the one paying for the realty taxes of the property. Secondly, petitioner asserts
she has been the only one hiring tenants for and benefiting from the produce of parcels 6 and 7. Lastly, the
non-attempt of respondents to partition parcels 6 and 7 within 10 years from the death of the Fangonil spouses,
as well as to reimburse her if indeed such was the agreement, demonstrates that they never considered the
said parcels part of the estate of their parents.

After a thorough examination of the cases cited by petitioner and a painstaking review of the case records, this
Court cannot give credence to petitioner’s stance. The scales of justice overwhelmingly tilt in favor of
respondents and against petitioner’s assertion that exclusive ownership of parcels 6 and 7 has vested in her.
The fact that it was petitioner’s money that was used for the repurchase of the properties does not make her
the owner thereof, in the absence of convincing proof that would indicate such. This is more so if other
evidence was adduced to show such is not the case. Neither will petitioner’s exercise of acts of ownership over
the properties bring us to that conclusion. It is evident that petitioner was allowed to maintain possession and
enjoy the fruits of the property only by the mere tolerance of the other co-owners.28 Moreover, although we
recognize that real estate tax receipts indicating payment of realty tax and possession of the parcels are indicia
of ownership, such are not conclusive proof of ownership, in the presence of other circumstances and evidence
showing otherwise.29 As a matter of fact, although the receipts indicate that the real estate tax payments for
parcels 6 and 7 for the years following their repurchase and release were made by petitioner, the receipts also
state that the declared owner of the properties is still the decedent Fabian Fangonil.

Petitioner and respondents executed an extrajudicial settlement dated 14 November 1983, wherein it was
stipulated that the Fangonil spouses died intestate, leaving 7 parcels of land in their names. Parcels 6 and 7
were included. It further stipulated that petitioner and her brother Tomas (now deceased) are the only creditors
of the estate, categorically stating petitioner is a creditor of the estate in the amount of ₱8,700.00. This amount
represents what was paid for by her for the repurchase and release from the mortgage lien of parcels 6 and 7
in the 1950s. Pertinent records of the case reveal that the amount actually advanced for the repurchase was
₱6,100.00. The aforementioned extrajudicial settlement, which was later on submitted to the RTC for
consideration in the judicial partition, taken together with petitioner’s comment30 in the same proceedings, are
clear and categorical evidences that the transaction between petitioner and her parents was a mere loan.
Under this extrajudicial settlement, respondents and petitioner included parcels 6 and 7 as part of the estate of
their deceased parents. It is particularly stated therein that petitioner and her brother Tomas are the only
creditors of the estate. Although petitioner’s comment allegedly maintained her claims on parcels 6 and 7, she
categorically admitted therein that the amount totaling ₱8,700.00 referred to in the extrajudicial settlement
represents the personal money she used for the redemption of parcels 6 and 7.

Thus, petitioner is a mere creditor of the estate and not an owner of parcels 6 and 7. An admission, verbal or
written, made by a party in the course of the proceedings in the same case, does not require proof. The
admission may be contradicted only by showing that it was made through palpable mistake, or that no such
admission was made.31We find that petitioner’s affidavit retracting her acquiescence to the stipulation on
parcels 6 and 7 in the extrajudicial settlement deserves scant consideration for being self-serving. Absent
positive proof that the earlier statements made by petitioner resulted from palpable mistake, retractions thereof,
especially if unsupported by evidence, lack credence.32

As to the issue of prescription, petitioner’s possession of parcels 6 and 7 did not ripen into sole and exclusive
ownership thereof. First, prescription applies to adverse, open, continuous, and exclusive possession. In order
that a co-owner’s possession may be deemed adverse to the other co-owners, the following elements33 must
concur: (1) that he has performed unequivocal acts of repudiation amounting to an ouster of the other co-
owners; (2) that such positive acts of repudiation have been made known to the other co-owners; and (3) that
the evidence thereon must be clear and convincing. Clearly, petitioner cannot claim adverse possession in the
concept of an owner where she voluntarily executed documents stating that she was a mere creditor and/or co-
owner. Mere silent possession by a co-owner; his receipt of rents, fruits or profits from the property; his erection
of buildings and fences and the planting of trees thereon; and the payment of land taxes cannot serve as proofs
of exclusive ownership, if it is not borne out by clear and convincing evidence that he exercised acts of
possession which unequivocably constituted an ouster or deprivation of the rights of the other co-owners.34 In
this case, we find that petitioner effected no clear and evident repudiation of the co-ownership. Petitioner’s only
act of repudiation of the co-ownership was when she refused to honor the extrajudicial settlement in 1994.
Alternatively, possession by a co-owner is like that of a trustee and shall not be regarded as adverse to the
other co-owners, but in fact as beneficial to all of them.35 A co-ownership is a form of trust, with each owner
being a trustee for each other.36 Mere actual possession by one will not give rise to the inference that the
possession was adverse because a co-owner is, after all, entitled to possession of the property. 37 Thus, as a
rule, prescription does not run in favor of a co-heir or co-owner as long as he expressly or impliedly recognizes
the co-ownership; and he cannot acquire by prescription the share of the other co-owners, absent a clear
repudiation of the co-ownership.38 An action to demand partition among co-owners is imprescriptible, and each
co-owner may demand at any time the partition of the common property. 39

On the matter of laches, we find no sufficient cause to apply the principle of laches, it being a principle
grounded on equity. Laches is the failure or neglect, for an unreasonable and unexplained length of time, to do
that which, by exercising due diligence, could or should have been done earlier; it is negligence or omission to
assert a right within a reasonable time, warranting the presumption that the party entitled to assert it either has
abandoned or declined to assert it.40 Several circumstances must be present. First, there should exist conduct
on the part of the defendant or one under whom he claims, giving rise to the situation of which complaint is
made and for which the complainant seeks a remedy. Second, there is delay in asserting the complainant’s
right, the complainant having had knowledge or notice of defendant’s conduct and having been afforded an
opportunity to institute a suit. Third, defendant had no knowledge or notice that the complainant would assert
the right on which he bases his claim. Fourth, the defendant will suffer injury or prejudice in the event relief is
accorded the complainant, or the suit is not held barred. Petitioner failed to prove the presence of all four
established requisites of laches. Moreover, there is no absolute rule as to what constitutes laches or staleness
of demand; each case is to be determined according to its particular circumstances, with the question of laches
addressed to the sound discretion of the court.41 Because laches is an equitable doctrine, its application is
controlled by equitable considerations and should not be used to defeat justice or to perpetuate fraud or
injustice.42

Regarding the issue on the computation of the money to be paid to petitioner as reimbursement for the amount
she advanced to repurchase and release parcels 6 and 7 from the mortgage debt, the Court of Appeals
adopted the amount as computed by the RTC based on the present peso money equivalent.43 There is a
discrepancy between the amount of indebtedness as quoted by the Court of Appeals from the RTC decision
and the amount cited by the Court of Appeals in the latter part of its decision. However, the amount stated in
the paragraph before the dispositive portion was ₱130,100.00, without any other indication that it intended to
modify the amount determined by the RTC while the body of the Court of Appeals decision quoting the RTC
decision indicated the amount of indebtedness as ₱138,100.00. There was obviously a typographical error,
with the body of the decision stating that the Court of Appeals was affirming the RTC’s manner of computation
totaling ₱138,100.00. Moreover, in the body and dispositive portion, the Court of Appeals upheld the RTC’s
decision in toto. Even then, the amount found by the RTC on the basis of the formula it used in the Order dated
7 October 1998 was erroneous.44
Still applying the present peso-dollar exchange rate, a slight modification in the computation is hereby ordered.
The present peso equivalent of the ₱6,100.00 indebtedness incurred on 13 November 1959 by the Fangonil
spouses and payable to petitioner should be computed based on the following figures:

The currency exchange rate of the Philippine Peso to the United States Dollar in the 1950s, which is
₱2.00:$1.00;

Currency exchange rate of the Philippine Peso to the United States Dollar as of the date of finality of this
judgment.

Therefore, the present peso money equivalent of the ₱6,100.00 should be derived from the succeeding
formula:

[(Current exchange rate of the Philippine Peso to the United States Dollar as of the date of finality of this
judgment divided by the exchange rate in the 1950s)] multiplied by ₱6,100.00 1av vphi1

WHEREFORE, premises considered, the instant Petition for Review is DENIED. The (a) Decision issued by the
Court of Appeals dated 30 January 2004 and (b) its Resolution dated 15 July 2005 denying petitioner’s Motion
for Reconsideration dated 23 February 2004 are hereby affirmed, with MODIFICATION as to the amount to be
reimbursed to petitioner. The present peso equivalent of the ₱6,100.00 indebtedness is hereby ordered
reimbursed to petitioner which amount shall be computed based on current peso-dollar exchange rates at the
time of finality of judgment, applying the formula below:

[(Current exchange rate of the Philippine Peso to the United States Dollar as of the date of finality of this
judgment divided by the exchange rate in the 1950s)] multiplied by ₱6,100.00

The equivalent amount shall be proportionately paid by all the heirs with each and every heir having a share in
the said indebtedness. No Costs.
G.R. No. 105608 April 30, 2008

TIRSO D. MONTEROSO, petitioner,


vs.
COURT OF APPEALS, SOLEDAD TINGA, MONTEROSO-CAGAMPANG, REYGULA MONTEROSO-
BAYAN, PERFECTO L. CAGAMPANG, SR., SOFIA PENDEJITO VDA. DE MONTEROSO, FLORENDA
MONTEROSO, ALBERTO MONTEROSO, HEIRS OF FABIAN MONTEROSO, JR., REYNATO
MONTEROSO, RUBY MONTEROSO, MARLENE MONTEROSO-POSPOS, ADELITA MONTEROSO-
BERENGUEL, and HENRIETO MONTEROSO, respondents.

x-----------------------------------------------x

G.R. No. 113199 April 30, 2008

SOFIA PENDEJITO VDA. DE MONTEROSO, SOLEDAD MONTEROSO-CAGAMPANG, PERFECTO L.


CAGAMPANG, SR., REYGULA MONTEROSO-BAYAN, FLORENDA MONTEROSO, ALBERTO
MONTEROSO, RUBY MONTEROSO, MARLENE MONTEROSO-POSPOS, HENRIETO MONTEROSO,
ADELITA MONTEROSO-BERENGUEL, and REYNATO MONTEROSO, petitioners,
vs.
COURT OF APPEALS and TIRSO D. MONTEROSO, respondents.

DECISION

VELASCO, JR., J.:

The Case

Before us are two petitions for review under Rule 45, the first docketed as G.R. No. 105608, and the second
docketed as G.R. No. 113199, both assailing the Decision1 dated March 31, 1992 of the Court of Appeals (CA)
in CA-G.R. CV No. 15805 which modified the June 9, 1987 Decision2 of the Regional Trial Court (RTC), Branch
4 in Butuan City in Civil Case Nos. 1292 and 1332.

The Facts

It is not unusual. Acrimonious litigation between and among siblings and immediate relatives over inheritance
does occur. It is unfortunate when the decedent had, while still alive, taken steps to precisely avoid a bruising
squabble over inheritance.

In a sense, Don Fabian B. Monteroso, Sr., a former justice of the peace and municipal mayor of Cabadbaran,
Agusan del Norte, started it all. During his lifetime, Don Fabian married twice and sired eight children, four from
each union.

In 1906, Don Fabian married Soledad Doldol. Out of this marriage were born Soledad, Reygula, Benjamin, and
Tirso. On April 8, 1927, Soledad Doldol Monteroso passed away.

A little over a year later, Don Fabian contracted a second marriage with Sofia Pendejito. From this union were
born Florenda, Reynato, Alberto, and Fabian, Jr.

After the death of his first wife, but during the early part of his second marriage, Don Fabian filed before the
Court of First Instance (CFI) of Agusan an intestate proceeding for the estate of his deceased first wife,
Soledad D. Monteroso, docketed as Special Proceeding (SP) No. 309, apparently to obviate any dispute over
the inheritance of his children from his first marriage. Subsequently, the CFI received––and later approved per
an Orden3 (Order) dated March 11, 1936––a Proyecto de Particion4 (Project of Partition) dated February 21,
1935.
The partition in SP No. 309 covered Parcels F-1 to F-5, and adjudicated to Don Fabian the whole of Parcels F-
1, F-2, and F-3, and one-half of Parcel F-5, while the intestate estate of Soledad D. Monteroso comprised the
whole of Parcel F-4 and one-half of Parcel F-5. The intestate estate of Soledad D. Monteroso was partitioned
and distributed to her four children in equal shares.

Subsequently, a Mocion5 (Motion) was filed for the delivery to Soledad D. Monteroso’s four children, her legal
heirs, their respective shares in her intestate estate, as adjudicated among them under the duly CFI-approved
Project of Partition.

In the meantime, the children of Don Fabian from his first marriage married accordingly: The eldest, Soledad to
Atty. Perfecto Cagampang, Sr.; Reygula to Jose Bayan; Benjamin to Mauricia Nakila; and Tirso to Melecia
Taña. Benjamin died on February 1, 1947 leaving behind four children with wife Nakila, namely: Ruby, Marlene,
Adelita, and Henrieto. A year and a half later, or on October 26, 1948, Don Fabian also passed away.

Before and shortly after Don Fabian’s demise, conveyances involving certain of parcels thus mentioned were
purportedly made.

The following is an illustration of the lineal relation of the parties or the family tree of the direct descendants of
Don Fabian from his two marriages:
This brings us to the objects of the squabble: the conjugal patrimonies of Don Fabian from his two successive
marriages.

During the lifetime of Don Fabian, the following properties were acquired, viz:

PARCEL F-ONE

A parcel of coconut plantation on sitio Pandanon, Cabadbaran, Agusan described as follows: North by
the property of Telesforo Ago and Gregorio Cupay; East by Miguel Y Climaco Cabonce, Isidro Maamo
and Buenaventura Sandigan and Pandanon River, and West by Gregorio Axamin, Alex Fores and
Ventura Sandigan with a superficial extension of 10 has. 62 ares and 42 centares.

PARCEL F-TWO

A parcel of coconut land situated on sitio Pandanon, Cabadbaran, Agusan, with a superficial extension
of 6 hectares, 50 ares bearing Tax No. 14801 of the Municipality of Cabadbaran, Agusan, x x x.
PARCEL F-THREE

A parcel of coconut land under Tax No. 17167 situated on sitio Calibunan, Cabadbaran, Agusan with
superficial extension of 8 hectares and 34 centares x x x.

PARCEL F-FOUR

A parcel of coconut land under Tax No. 14600 situated on sitio Pandanon, Cabadbaran, Agusan, with
a superficial extension of 27 hectares, 96 ares and 28 centares x x x.

PARCEL F-FIVE

A parcel of residential lot under Tax No. 18477 situated within the Poblacion of the Municipality of
Cabadbaran, Agusan, with a house of strong materials found on the same lot with a superficial
extension of 660 square meters x x x.

PARCEL F-SIX

A parcel of residential lot under Tax No. 5374 situated within the Poblacion of the Municipality of
Cabadbaran, Agusan, with a superficial extension of 3,890 square meters x x x.

PARCEL F-SEVEN

A parcel of coconut and corn land under Tax No. 1769 situated at Ambahan, Tubay, Agusan, with a
superficial extension of 8 hectares x x x.

PARCEL F-EIGHT

A parcel of coconut land situated at Ambahan, Tubay, Agusan, under Tax No. 2944, with a superficial
extension of 7 hectares, 59 ares and 96 centares x x x.6

PARCEL S-ONE

A parcel of land situated at Tagbongabong, Cabadbaran, Agusan under Tax Dec. No. 5396 with an
area of 24 hectares more or less x x x.

PARCEL S-TWO

A parcel of coconut land situated at Dal-as, Bay-ang, Cabadbaran, Agusan under Tax No. 69 with an
area of 24 hectares more or less x x x.

PARCEL S-THREE

A parcel of coconut land situated at Pandanon, Mabini, Cabadbaran, Agusan, under Tax No. 21639
with an area of 1.4080 hectares more or less x x x.

PARCEL S-FOUR

A parcel of land situated at Mabini, Cabadbaran, Agusan under Tax No. 3367 with an area of 1,000 sq.
m. bounded x x x.7

The "F" designation signified that the covered properties were acquired during the first marriage, to distinguish
them from those acquired during the second marriage which are designated as "S" properties.
On July 28, 1969, the children of the late Benjamin D. Monteroso, namely: Ruby Monteroso, Marlene M.
Pospos, Henrieto Monteroso, and Adelita Monteroso-Berenguel, filed with the RTC a Complaint for Recovery of
Property with Damages against their uncle, Tirso D. Monteroso. Docketed as Civil Case No. 1292, and later
raffled to Branch 4 of the court, the complaint involved a portion of Parcel F-4, described in the Project of
Partition, as follows:

(1) One parcel of coconut land with the improvements thereon existing, Tax No. 14600 with a
superficial extension of 6 hectares, 99 ares and 32 centares, bounded as follows: on the North, Regula
Monteroso; on the East by the Provincial Road Butuan-Cabadbaran; on the Sourth Tirso Monteroso
and on the West Diego Calo.8

As the heirs of Benjamin alleged in their complaint, their uncle, Tirso, was entrusted with the above-described
one-fourth portion of Parcel F-4 as part of the share from the estate of Soledad D. Monteroso allotted to their
father per SP No. 309. However, their uncle refused to surrender and deliver the same when they demanded
such delivery upon their reaching the majority age.

Tirso countered that the portion pertaining to Benjamin was never entrusted to him; it was in the possession of
their sister, Soledad Monteroso-Cagampang, who was not entitled to any share in Parcel F-4, having previously
opted to exchange her share in said property for another parcel of land, i.e., Parcel F-7, then being occupied by
her.

On April 14, 1970, Tirso, in turn, filed a Complaint for Partition and Damages with Receivership docketed
as Civil Case No. 1332, involving 12 parcels of land (i.e., Parcels F-1 to F-8 and Parcels S-1 to S-4, mentioned
above) against his stepmother, Pendejito, and all his full and half-siblings and/or their representatives. The
complaint in Civil Case No. 1332 was subsequently amended to include Perfecto, as co-defendant, and
Pendejito, as guardian ad litem for the minor children of Fabian P. Monteroso, Jr., who died in 1970 after the
filing of the complaint.

In Civil Case No. 1332, Tirso, inter alia, alleged the following: (1) the aforementioned 12 parcels of land belong
to the conjugal partnerships of the first and second marriages contracted by Don Fabian; (2) SP No. 309, which
purportedly judicially settled the intestate estate of his mother, is null and void for the reason that the project of
partition failed to comprehend the entire estate of the decedent as Parcels F-6, F-7, and F-8 were excluded,
thereby depriving Tirso of his one-fourth share or legitime over the said three parcels of land; and (3) Parcels
S-1 to S-4, having been acquired during the second marriage of Don Fabian, are not paraphernal properties of
Sofia Pendejito Vda. de Monteroso.

Answering, the defendants in Civil Case No. 1332 contended that Don Fabian acquired Parcel F-6 during the
second marriage, while Parcels F-7 and F-8 were Don Fabian’s exclusive properties having been acquired
through a donation from the heirs of one Benito Tinosa. They further maintained the validity of the judicial
partition under SP No. 309 which operates as res judicata insofar as Parcels F-1 to F-5 are concerned. In
particular, they asserted that Parcels F-1, F-2, F-3, and one-half of F-5 were adjudicated to Don Fabian as his
share in the conjugal partnership of the first marriage, while Parcel F-4 and the other half of Parcel F-5 were
equally divided among the four children of the first marriage; that during his lifetime, Don Fabian sold Parcels F-
1, F-2, F-3, F-7, and F-8 to Soledad Monteroso-Cagampang; that Soledad Monteroso-Cagampang, Tirso D.
Monteroso, and Mauricia Nakila Vda. de Benjamin Monteroso donated Parcel F-6 to Reygula Monteroso-
Bayan; and that Parcels S-1 to S-4 are truly paraphernal properties of Sofia Pendejito Vda. de Monteroso as
Parcel S-1 was acquired by her through a homestead patent, Parcel S-2 through adverse possession, and
Parcels S-3 and S-4 by purchase.

The Initial Ruling of the RTC

Involving practically the same properties and parties, Civil Case Nos. 1292 and 1332 were consolidated and
jointly heard. After a long drawn-out trial spanning almost 15 years, with six different judges successively
hearing the case, the RTC, presided by Judge Miguel Rallos, rendered on July 22, 1985 a
Decision,9 dismissing Civil Case No. 1292 on the ground of failure to state a cause of action, but finding, in Civil
Case No. 1332, for Tirso.
What appears to be a victory for Tirso was, however, short-lived. Acting on four separate motions for
reconsideration duly filed by the various defendants in Civil Case No. 1332, a new judge, who took over the
case from Judge Rallos who inhibited himself from the case, rendered a new decision.

The Subsequent Ruling of the RTC

Dated June 9, 1987, the new Decision set aside the July 22, 1985 RTC Decision of Judge Rallos and gave due
course to both Civil Case Nos. 1292 and 1332. In full, the fallo of the new decision reads:

WHEREFORE, premises considered, both complaints in Civil Cases No. 1292 and 1332 are hereby
given due course and judgment is hereby rendered as follows:

1. Declaring, confirming and ordering that Lot 380, Pls-736 located at Pandanon, Cabadbaran,
belongs to the children of first marriage and partitioned as per subdivision survey map made by
Geodetic Engineer Antonio Libarios, Exh. ‘7’, page 72 of the records as follows:

(a.) Lot 380-A, Share of Soledad Monteroso Cagampang with an area of 5.3376 hectares,
with technical description therein;

(b.) Lot 380-B, Share of Reygula Monteroso Bayan with an area of 5.3376 hectares, with
technical description therein;

(c.) Lot 380-C, Share of the Heirs of Benjamin D. Monteroso with an area of 5.3376 hectares
with technical description therein;

(d.) Lot 380-D, Share of Tirso D. Monteroso with an area of 5.3376 hectares and Lot 351, Pls-
736 with an area of 6,099 sq. meters, with both technical description therein;

2. It is hereby ordered that Tirso D. Monteroso must deliver, return, relinquish, cede, waive and/or quit
claim immediately the area of 3.7815 hectares being portion of Lot 380-C, Pls-736 indicated in the
subdivision survey plan by Engr. Libarios, page 72, Records, Civil Case No. 1292, Folio 2, Exh. "V", to
the Heirs of Benjamin D. Monteroso who are absolute owners of Lot 380-C, Pls-736 and to pay, return
and deliver immediately to the said Heirs of Benjamin D. Monteroso the net income in arrears from
1948 to 1983, the total sum of Two Hundred Sixty Thousand Eight Hundred Forty Four and 70/100
(P260,844.70) Pesos with interest of 12% per annum compounded annually from January 1, 1984 up
to the present and until fully paid;

3. It is hereby ordered that Reygula Monteroso Bayan must deliver, return, relinquish, cede, waive
and/or quit claim immediately the area of 1.6128 hectares which is part of Lot 380-C, Pls-736,
indicated in the subdivision survey plan by Engr. Libarios, page 72, Records (Civil Case No. 1292,
Folio 2), Exh. ‘V’, to the Heirs of Benjamin D. Monteroso who are the absolute owners of Lot 380-C,
Pls-736 and to pay, return and deliver immediately to the said Heirs of Benjamin D. Monteroso the net
income in arrears from 1948 to 1983 the total sum of One Hundred Six Thousand Nine Hundred Sixty
and 40/100 (P106,960.40) Pesos with interest of 12% per annum compounded annually from January
1, 1984 up to the present and until fully paid;

4. It is hereby ordered that Soledad Monteroso Cagampang must deliver, return, relinquish, cede,
waive and/or quit claim immediately the area of 1.0929 hectares being portion of Lot 380-C, Pls-736,
indicated in the subdivision survey plan by Engr. Libarios, page 72, Records (Civil Case No. 1292,
Folio 2), Exh. ‘V’, to her sister Reygula Monteroso Bayan who is the absolute owner of Lot 380-C, Pls-
736 and to pay, return and deliver immediately to the said Reygula Monteroso Bayan the net income in
arrears from 1948 to 1983, the total sum of Seventy Seven Thousand Six Hundred Twenty Five and
96/100 (P77,625.96) Pesos with interest of 12% per annum compounded annually from January 1,
1984 up to the present and until fully paid, subject to deduction of whatever cash advances, if any, was
ever received by Reygula M. Bayan.
5. The three alleged Absolute Sale, Exh. ‘C’, ‘D’ and ‘E’ with all its submarkings are declared fictitious,
simulated and no consideration. It can never be considered a donation because aside from being
inofficious and impairing the legitime of other heirs, the vendee had not signed therein which could be
considered acceptance and above all, these documents were prepared and acknowledged by Notary
Public squarely disqualified and highly prohibited. Therefore, all are declared null and void and of no
legal effect.

So, parcels F-1, F-2, F-3, F-6, F-7 and F-8 [remain] as part of the intestate estate of Don Fabian B.
Monteroso, Sr.

6. The Register of Deeds and the Provincial Assessor, both in the Province of Agusan del Norte are
hereby ordered to cancel as the same are cancelled and nullified, all transfer of certificates and tax
declarations now in the name of Soledad Monteroso de Cagampang and Atty. Perfecto L.
Cagampang, Sr. which parcels of land originally were registered and declared in the name of Don
Fabian B. Monteroso, Sr., and to register and declare again in the name of Heirs of Don Fabian B.
Monteroso, Sr., more particularly the following:

(a.) [TCT No. RT-203] (420) for Lot 432, Cad. 121, with an area of 10.0242 hectares under
Tax Dec. No. 02-018-0224, Series of 1980, PIN-02-019-05-050 known as Parcel F-1;

(b.) TCT No. RT-205 (424) for Lot 100, Cad. 121, with an area of 1.9083 hectares under Tax
Dec. No. 02-019-0488, Series of 1980, PIN-02-019-08-002 known as F-2;

(c.) TCT No. RT-204 (423) for Lot 103, Cad. 121, with an area of 2.8438 hectares under Tax
Declaration No. 02-019-0335, Series of 1980, PIN-02-019-08-017 known as F-2;

(d.) Parcel of coconut land located at Poblacion, Cabadbaran, known as F-3 with area of
6.3100 hectares under Tax Dec. No. 02-001-1810, Series of 1980 and PIN-02-001-30-027;

(e.) Residential Lot, known as F-5 located at Poblacion, Cabadbaran under Tax Dec. No.
18447 then under Tax Dec. No. 1922, containing an area of 660 sq. meters bounded on the
North by Washington Street; on the East by Progresso Street; on the South by Rizal Street;
and on the West by Ramon Cabrera.

(f.) Residential Lot known as F-6 located at Poblacion under Tax Dec. No. 5374, Series of
1949 and Tax Dec. No. 499, Series of 1954, consisting of 3,890 sq. meters bounded as
follows:

North – Andres Atega

South – Rill

East – Luis Jamboy now Celestino Udarbe,

Sixto Ferrer and New Road

West – Atega Street;

(g.) Coconut land known as F-7, located at Ambajan, Tubay, Agusan del Norte under Tax
Dec. No. 1769, Series of 1955 and Tax Dec. No. 10-03-0273, Series of 1980 with an area of
[8.000] hectares;

(h.) Parcel of coconut land known as F-8, located at Ambajan, Tubay, Agusan del Norte with
an area of 7.5996 hectares under Tax Dec. No. 2944 and Tax Dec. No. 10-03-0273, Series of
1980;
(i.) Parcel of S-1, located at Tagbongabong, Cabadbaran under Tax Dec. No. 11506, Series
of 1963 with an area of 24 hectares in the name of Sofia Vda. de Monteroso;

(j.) Parcel of S-2, located at Dal-as, Bay-ang, Cabadbaran, under Tax Dec. No. 1888, Series
of 1948, Tax Dec. No. 669, Series of 1952, and subsequently transferred in fraud of other
heirs, in the name of Florenda P. Monteroso under Tax Dec. No. 11507, Series of 1964, Tax
Dec. No. 3381, Series of 1972, Tax Dec. No. 5036, Series of 1974, Tax Dec. No. 02-006-
0047, Series of 1980;

(k.) Parcel of S-3, located at Pandanon, Mabini, Cabadbaran, under Tax Dec. No. 5373,
Series of 1949 with an area of 1.4080 hectares and bounded as follows:

North – Pandanon River

South – Crisanto Dolleroso

East – Pandanon River

West – Pandanon River and Peregrino Aznar;

(L.) Parcel S-4, located at Mabini, Cabadbaran, under Tax Dec. No. 3367 with an area of
1.6500 hectares and bounded as follows:

North – Hrs. of G. Corvera

South – C. Vda. de Alburo

East – Ellodoro Delleroso

West – A. Ventura

7. It is hereby declared that upon the death of Don Fabian B. Monteroso, Sr. on March 26, 1948, the
following are the properties belonging to his intestate estate:

(a.) Whole parcel Lot 432, F-1;

(b.) Whole parcels Lot 100 and 103, F-2;

(c.) Whole parcel cocoland, Calibunan, F-3;

(d.) One-half (1/2) parcel F-5;

(e.) One-half (1/2) parcel F-6;

(f.) One-half (1/2) parcel F-7;

(g.) One-half (1/2) parcel F-8;

(h.) One-half (1/2) parcel S-1;

(i.) One-half (1/2) parcel S-2;

(j.) One-half (1/2) parcel S-3;


(k.) One-half (1/2) parcel S-4.

8. It is hereby ordered that Lot 432 under TCT [No.] RT-203 (420) with an area of 10.0242 hectares
under Tax Dec. No. 02-018-0224 (1980) is hereby divided into nine (9) equal shares for the eight (8)
children of Don Fabian B. Monteroso and the one-ninth (1/9) share be held in usufruct by the widow
Sofia Pendejito Monteroso during her lifetime.

Sofia Pendejito Monteroso being in possession and enjoying the fruits or income of F-1 is hereby
ordered to pay and deliver immediately to the following heirs the corresponding amount of net income
of F-1, Lot 432, from 1948 to 1983:

(a.) To Soledad Monteroso Cagampang – P78,521.32

(b.) To Reygula Monteroso Bayan – P78,521.32

(c.) To Hrs. of Benjamin D. Monteroso – P78,521.32

(d.) To Tirso D. Monteroso – P78,521.32

(e.) To Florenda P. Monteroso – P78,521.32

(f.) To Reynato P. Monteroso – P78,521.32

(g.) To Alberto P. Monteroso – P78,521.32

(h.) To Hrs. of Fabian P. Monteroso, Jr. – P78,521.32

The above-mentioned [amounts] shall be subject to deduction for whatever cash advance any heir
may have received. Then the net balance of said [amounts] shall be subject to interest at the rate of
twelve percent (12%) per annum compounded annually from January 1, 1984 to the present until fully
paid.

9. It is hereby ordered that Lot 100 under [TCT No. RT-205] (424) with an area of 1.9083 hectares
under Tax Dec. No. 02-019-0488, Series of 1980 and Lot No. 103 under [TCT No. RT-204] (423) with
an area of 2.8438 hectares and under Tax Dec. No. 02-019-0335, Series of 1980, [both known as
Parcel F-2,] shall be divided into nine (9) equal shares for the eight (8) children of Fabian B.
Monteroso, Sr. and one-ninth (1/9) share shall be held in usufruct by the widow, Sofia P. Monteroso,
during her lifetime.

Soledad Monteroso Cagampang and Atty. Perfecto L. Cagampang, Sr. are ordered to deliver to [their]
co-heirs their shares in these parcels of land, F-2, free from any lien and encumbrances whatsoever,
and to pay each of them the net income in arrears from 1948 to 1983, namely:

(a.) To Reygula Monteroso Bayan – P34,976.85

(b.) To Hrs. of Benjamin D. Monteroso – P34,976.85

(c.) To Tirso D. Monteroso – P34,976.85

(d.) To Florenda P. Monteroso – P34,976.85

(e.) To Reynato P. Monteroso – P34,976.85


(f.) To Alberto P. Monteroso – P34,976.85

(g.) To Hrs. of Fabian P. Monteroso, Jr. – P34,976.85

(h.) To Sofia P. Monteroso (usufruct) – P34,976.85

The above-mentioned [amounts] shall be subjected to deduction of whatever amount any heir may
have received by way of cash advances.

The net amount shall be subjected to an interest at the rate of twelve percent (12%) per annum
compounded annually from January 1, 1984 to the present or until fully paid.

10. Soledad Monteroso Cagampang and Atty. Perfecto L. Cagampang, Sr. being in possession and
enjoying the fruits and income of Parcel F-3, are hereby ordered to pay to the following heirs, the net
income in arrears from 1948 to 1983:

(a.) To Reygula Monteroso Bayan – P49,727.35

(b.) To Hrs. of Benjamin D. Monteroso – P49,727.35

(c.) To Tirso D. Monteroso – P49,727.35

(d.) To Florenda P. Monteroso – P49,727.35

(e.) To Reynato P. Monteroso – P49,727.35

(f.) To Alberto P. Monteroso – P49,727.35

(g.) To Hrs. of Fabian P. Monteroso, Jr. – P49,727.35

(h.) To Sofia P. Monteroso (usufruct) – P49,727.35

The above-mentioned [amounts] shall be subject to deduction for whatever cash advance, if any, such
heir may have received. Then the net [amounts] shall be subject to interest at the rate of twelve
percent (12%) per annum compounded annually from January 1, 1984 to the present until fully paid.

Soledad Monteroso Cagampang and Atty. Perfecto L. Cagampang, Sr. are both ordered to deliver to
the above-mentioned co-heirs their respective shares free from any lien and encumbrances
whatsoever.

11. Parcels F-5, F-6, F-7 and F-8 are declared real properties belonging to the first marriage. Hence
one-half (1/2) of each of these four parcels shall equally be divided by the four (4) children of the first
marriage and the other half must be divided into nine (9) equal shares for the eight (8) children of
Fabian B. Monteroso, Sr., and one-ninth (1/9) shall be held in usufruct by the widow, Sofia Pendejito
Vda. de Monteroso.

Therefore, it is hereby ordered that F-6 is divided as follows:

(a.) To Soledad Monteroso Cagampang - - - - 702 sq. m.

(b.) To Reygula Monteroso Bayan - - - - - - - 702 sq. m.

(c.) To Hrs. of Benjamin D. Monteroso - - - - 702 sq. m.


(d.) To Tirso D. Monteroso - - - - - - - - - - - - 702 sq. m.

(e.) To Florenda P. Monteroso - - - - - - - - - - 216 sq. m.

(f.) To Reynato P. Monteroso - - - - - - - - - - - 216 sq. m.

(g.) To Alberto P. Monteroso - - - - - - - - - - - 216 sq. m.

(h.) To Hrs. of Fabian Monteroso, Jr. - - - - - - 216 sq. m.

(i.) To Sofia P. Monteroso - - - - - - - - - - - - - 216 sq. m.

12. It is hereby ordered, that Soledad Monteroso Cagampang and Atty. Perfecto L. Cagampang, Sr.
must deliver to all heirs their respective shares on F-7 and F-8 including usufruct of Sofia P. Monteroso
as declared in paragraph five (5) and in addition, must pay and deliver the net income in arrears from
1948 to 1983, summarized as follows:

(a.) To Reygula Monteroso Bayan - - - - - P189,665.88

(b.) To Hrs. of Benjamin D. Monteroso - - P189,665.88

(c.) To Tirso D. Monteroso - - - - - - - - - - P189,665.88

(d.) To Florenda P. Monteroso - - - - - - - - P 58,358.73

(e.) To Reynato P. Monteroso - - - - - - - - - P 58,358.73

(f.) To Alberto P. Monteroso - - - - - - - - - P 58,358.73

(g.) To Hrs. of Fabian Monteroso, Jr. - - - - P 58,358.73

(h.) To Sofia P. Monteroso (usufruct) - - - - P 58,358.73

all with interest at the rate of twelve percent (12%) per annum compounded annually from January 1,
1984 to the present until fully paid. However, it is subject to deduction of whatever cash advances, if
ever any heir, may have received.

13. The Deed of Donation in 1948, Exh. "F", over parcel known as F-5, is declared null and void
because the same was prepared and acknowledged before a Notary Public disqualified and prohibited
to do so under Notarial Law (Barretto vs. Cabreza, 33 Phil. Reports 112). Hence, the transfer of tax
declaration is hereby ordered cancelled and the same must be declared again in the name of the Heirs
of Fabian B. Monteroso, Sr. and ordered partitioned in the proportion stated in paragraph eleven (11)
hereof.

14. Parcels of land known as S-1, S-2, S-3 and S-4 are declared conjugal properties of the second
marriage. Hence, one-half (1/2) thereof belongs to Sofia Pendejito Monteroso and one-half (1/2) shall
be equally divided into nine (9) shares for the eight (8) children of Don Fabian B. Monteroso, Sr. where
the one-ninth (1/9) shall be held in usufruct by Sofia P. Monteroso during her lifetime.

15. For the net income in arrears of S-1 located at Tagbongabong, Cabadbaran, from 1948 to 1983,
Sofia Pendejito Monteroso is hereby ordered to pay and deliver to the following heirs the
corresponding share:
(a.) To Soledad Monteroso Cagampang - - P93,998.12

(b.) To Reygula Monteroso Bayan - - - - - P93,998.12

(c.) To Hrs. of Benjamin D. Monteroso - - P93,998.12

(d.) To Tirso D. Monteroso - - - - - - - - - - P93,998.12

(e.) To Florenda P. Monteroso - - - - - - - - P93,998.12

(f.) To Reynato P. Monteroso - - - - - - - - P93,998.12

(g.) To Alberto P. Monteroso - - - - - - - - - P93,998.12

(h.) To Hrs. of Fabian P. Monteroso, Jr. - - P93,998.12

However, all these amounts shall be subject to deduction, if any cash advance was ever made or
received by any heir.

The above-mentioned [amounts are] subject to an interest at the rate of twelve percent (12%)
compounded annually from January 1, 1948 to the present until fully paid.

16. The alleged Deed of Absolute Sale executed by Sofia P. Monteroso in favor of Florenda P.
Monteroso over a coconut land located at Dal-as, Bay-ang, Cabadbaran, consisting of 24 hectares is
hereby declared null and void being in fraud of other heirs. It is clearly inofficious and impairs the
legitime of her brothers, sisters and nephews and nieces. Therefore, the tax declaration in the name of
Florenda P. Monteroso under Tax Dec. No. 11507, Series of 1964, Tax Dec. No. 3381, Series of 1972,
Tax Dec. No. 5036, Series of 1974 and Tax Dec. No. 02-006-0047, PIN-02-006-02-002 are hereby
ordered cancelled and the said land shall be declared again in the name of Heirs of Fabian B.
Monteroso.

Sofia Pendejito Monteroso is not required to render accounting as to the income of S-2 because the
coconut trees therein were planted by her while being already a widow. One-half (1/2) of the land
where the coconut trees are planted shall be her share and the other one-half (1/2) shall be divided
into nine (9) shares for the eight (8) children of Fabian B. Monteroso including her 1/9 usufruct thereon.

17. Sofia Pendejito Monteroso is hereby ordered to pay and deliver immediately the net income in
arrears of parcel S-3 located at Pandanon to the following heirs with the corresponding amount:

(a.) To Soledad Monteroso Cagampang - - P49,349.02

(b.) To Reygula Monteroso Bayan - - - - - P49,349.02

(c.) To Hrs. of Benjamin D. Monteroso - - P49,349.02

(d.) To Tirso D. Monteroso - - - - - - - - - - P49,349.02

(e.) To Florenda P. Monteroso - - - - - - - - P49,349.02

(f.) To Reynato P. Monteroso - - - - - - - - P49,349.02

(g.) To Alberto P. Monteroso - - - - - - - - - P49,349.02


(h.) To Hrs. of Fabian P. Monteroso, Jr. - - P49,349.02

However, [the] above-mentioned [amounts] shall be subject to deductions, if any cash advance was
ever made or received by any heir.

Then the net amount receivable shall be subject to an interest at the rate of twelve percent (12%)
compounded annually from January 1, 1984 to the present until fully paid.

18. For the net income in arrears of parcel S-4, located at Mabini, Cabadbaran, from 1948 to 1983,
Sofia P. Monteroso is hereby ordered to pay and deliver to the following heirs their corresponding
shares:

(a.) To Soledad Monteroso Cagampang - - P6,477.54

(b.) To Reygula Monteroso Bayan - - - - - P6,477.54

(c.) To Hrs. of Benjamin D. Monteroso - - P6,477.54

(d.) To Tirso D. Monteroso - - - - - - - - - - P6,477.54

(e.) To Florenda P. Monteroso - - - - - - - - P6,477.54

(f.) To Reynato P. Monteroso - - - - - - - - P6,477.54

(g.) To Alberto P. Monteroso - - - - - - - - - P6,477.54

(h.) To Hrs. of Fabian P. Monteroso, Jr. - - P6,477.54

However, all these amounts shall be subject to deductions, if any cash advance was ever made or
received by any heir.

The above-mentioned amount is subject to an interest at the rate of twelve percent (12%) compounded
annually from January 1, 1984 to the present until fully paid.

Sofia Pendejito Monteroso is ordered to deliver to the above-mentioned heirs their respective shares
free from any lien and encumbrances whatsoever.

19. These cases involved inheritance, hence the Bureau of Internal Revenue (BIR) of Agusan del
Norte at Butuan City is hereby notified for prompt, proper and appropriate action. Likewise, the
Provincial Treasurer of Agusan del Norte and the Municipal Treasurers of Cabadbaran and Tubay are
hereby informed and reminded for their prompt, proper and appropriate action in the assessment and
collection of real estate taxes including transfer’s tax.

20. That all the heirs are hereby directed, and ordered to pay all taxes due in favor of the Government
of the Republic of the Philippines within thirty (30) days from the finality of judgment hereof, otherwise,
upon proper application or manifestation by appropriate or concerned government agency, a portion of
the intestate estate of Don Fabian B. Monteroso, Sr., shall be sold at public auction for such purpose.

21. Under Civil Case No. 1292, Tirso D. Monteroso or his heirs, assigns and successors-in-interest, is
hereby ordered to pay Ruby Monteroso, Marlene Monteroso-Pospos, Adelita Monteroso-Berenguel
and Henrieto Monteroso the following sums of money:

(a.) P10,000.00 for moral damages;


(b.) P10,000.00 for exemplary damages;

(c.) P3,000.00 for costs of suit; and

(d.) P10,000.00 for attorney’s fees.

22. Under Civil Case No. 1292, Soledad Monteroso de Cagampang and Reygula Monteroso Bayan
are hereby ordered jointly and severally to pay Ruby Monteroso, Marlene Monteroso-Pospos, Adelita
Monteroso-Berenguel and Henrieto Monteroso the following sums of money:

(a.) P10,000.00 for moral damages;

(b.) P10,000.00 for exemplary damages;

(c.) P2,000.00 for costs of suit; and

(d.) P10,000.00 for attorney’s fees.

23. Under Civil Case No. 1332, Soledad Monteroso Cagampang, Atty. Perfecto L. Cagampang, Sr.
and Sofia Pendejito Vda. de Monteroso or their heirs, assigns and successors-in-interest, are hereby
ordered to pay jointly and severally, unto and in favor of Tirso D. Monteroso or his heirs, assigns and
successors-in-interest, the following sums of money:

(a.) P20,000.00 for moral damages;

(b.) P20,000.00 for exemplary damages;

(c.) P5,000.00 for costs of suit; and

(d.) P10,000.00 for attorney’s fees.

24. It is hereby ordered that a judicial administrator of the intestate estate of Don Fabian B. Monteroso,
Sr. shall be appointed by this Court upon written recommendation by all the parties within thirty (30)
days from promulgation of this decision. Should the parties fail to submit unanimously a
recommendee, the Court at its discretion may appoint an administrator, unless none of the parties
appeal this decision and this judgment is complied with by all the parties and/or so executed in
accordance with the provisions of the New Rules of Court.

SO ORDERED.10

As regards Civil Case No. 1292, the RTC found that the heirs of Benjamin have indeed been deprived of their
inheritance which corresponds to one-fourth share due their father from the intestate estate of their
grandmother, Soledad D. Monteroso. Thus, the court ordered the equal distribution of Parcel F-4, i.e., Lot 380,
Pls-736 located in Pandanon, Cabadbaran, Agusan del Norte, among the children of the first marriage of Don
Fabian, and partitioned it based on the subdivision survey map prepared by a geodetic engineer.

Turning on the alleged sale of Parcels F-1, F-2, F-3, F-7, and F-8 by Don Fabian to Soledad Monteroso-
Cagampang, the RTC found the covering three deeds of absolute sale11 to be null and void for the reason that
the alleged conveyances were fictitious, simulated, and/or without sufficient consideration. Alternatively, the
RTC ruled that the conveyances, even if considered as donation, would be inofficious for impairing the legitime
of the other compulsory heirs, not to mention the lack of due acceptance of the donation by Soledad
Monteroso-Cagampang. Adding a vitiating element to the conveyances, as the RTC noted, was the fact that
the corresponding documents were prepared by and acknowledged before Perfecto, who happened to be the
husband of the alleged vendee, Soledad Monteroso-Cagampang.
The RTC also declared as null and void the donation of Parcel F-5 to Reygula Monteroso-Bayan owing to clear
legal infirmities attaching to the covering deed of donation.12 For one, the parcel in question, while purportedly
donated free from any liens or encumbrance, was in fact the subject of a deed of absolute sale between Don
Fabian and the Cagampang spouses. For another, one of the signatory-donors, Mauricia Nakila, Benjamin’s
widow, did not have the right to effect a donation because she was not a compulsory heir of her husband by
representation. The RTC added that the real owners of the rights and interests of Benjamin over Parcel F-5 are
her children as representative heirs.

Finally, the RTC declared the Order dated March 11, 1936 issued in SP No. 309 approving the Project of
Partition to be valid, and that it constitutes res judicata on the affected properties, i.e., Parcel F-4 and one-half
of Parcel F-5, which were equally distributed to the heirs of Soledad D. Monteroso. Pursuing this point and on
the finding that Parcels F-1 to F-8 were acquired during the first marriage and Parcels S-1 to S-4 during the
second, the RTC thus held that Don Fabian’s intestate estate consisted of the whole of Parcels F-1, F-2, and F-
3; and half of Parcels F-5 to F-8 and half of Parcels S-1 to S-4, to be distributed in accordance with the law on
intestate succession. This means, the RTC concluded, that the estate shall descend to Don Fabian’s
compulsory heirs and their representatives, as in the case of the late Benjamin and Fabian, Jr., subject to
accounting of the income or produce of the subject properties for the applicable period, less advances made or
received by any heir, if any.

The Ruling of the CA

From the above June 9, 1987 Decision, Tirso, defendant in Civil Case No. 1292, appealed to the CA, so did the
Cagampang spouses, defendants in Civil Case No. 1332. The other defendants in Civil Case No. 1332,
namely: Sofia Pendejito Vda. de Monteroso, Florenda Monteroso, Alberto Monteroso, Heirs of Fabian
Monteroso, Jr., Reynato Monteroso, and Reygula Monteroso-Bayan, also interposed their own appeal. The
separate appeals were consolidated and docketed as CA-G.R. CV No. 15805.

On March 31, 1992, the CA rendered the assailed decision, affirming with modification the June 9, 1987 RTC
Decision, disposing as follows:

WHEREFORE, the decision appealed from is hereby modified, as follows:

a) In the event that a homestead patent over Parcel S-1 is issued by the Bureau of Lands
pursuant to the patent application of Sofia Pendejito Vda. de Monteroso, said patent shall
issue not in the name of the applicant but in favor of the eight heirs of Fabian Monteroso, Sr.
who thereafter shall be declared absolute owners of the said parcel of land in the proportion
stated in this decision but who nevertheless shall allow Sofia Pendejito Vda. de Monteroso to
exercise during her lifetime usufructuary rights over a portion of the said parcel of land
equivalent to the share therein of each of the heirs of her deceased husband;

b) The said heirs of Fabian Monteroso, Sr. are hereby declared absolute owners of Parcel F-6
to the extent of their respective shares therein as presently individually possessed by them
pursuant to an extrajudicial partition of the said parcel of land which the Court hereby declares
as a valid contract among the said heirs; and

c) With the exception of those pertaining to Parcel F-4 as stated in this decision, the parties
thus found to have unjustly misappropriated the fruits of the subject parcels of land are hereby
directed to render an accounting thereof consistent with our findings in the case at bar.

With the exception of the foregoing modifications, the decision under review is hereby AFFIRMED in
all other respects.

No pronouncement as to costs.

SO ORDERED.13
The CA summarized into three issues the multifarious assignments of errors raised by the parties, to wit: first,
whether or not the intestate estate of Soledad Doldol Monteroso was settled in SP No. 309, thus according the
Project of Partition approved therein the effect of res judicata; second, whether or not it was appropriate to
partition Parcels F-1, F-2, and F-3, and half of Parcels F-5, F-6, F-7, F-8, S-1, S-2, S-3, and S-4; and third,
whether or not Tirso D. Monteroso is entitled to damages.

The CA resolved the first issue in the affirmative, SP No. 309 being a valid and binding proceedings insofar as
the properties subject thereof are concerned, i.e., Parcels F-1 to F-5 of which the whole of Parcel F-4 and one-
half of Parcel F-5, as Soledad D. Monteroso’s intestate estate, were distributed to her heirs. This is not to
mention that the authenticity and due execution of the documents filed or issued in relation therewith––referring
to the Proyecto de Particion dated February 12, 1935 which is a carbon copy of the original, the Orden issued
by the CFI on March 11, 1936, and the Mocion dated March 18, 1936––having duly been established. Affirming
the RTC, the CA rejected Tirso’s claim that SP No. 309 is void for settling only a part of the estate of Soledad
D. Monteroso. The CA held that partial settlement is not a ground for the nullification of the judicial partition
under either the Spanish Civil Code of 1889 or the present Civil Code. The appellate court added that the
proper remedy in such a situation is to ask for the partition and the subsequent distribution of the property
omitted.

The CA likewise disposed of the second issue in the affirmative, dismissing the opposition of the Cagampang
spouses and Reygulo Monteroso-Bayan who all claimed ownership over some of the parcels of land on the
strength of the deeds of conveyance executed in their favor. The CA upheld the RTC’s finding that the three
deeds of absolute sale in which Don Fabian purportedly sold Parcels F-1, F-2, F-3, F-7, and F-8 to Soledad
Monteroso-Cagampang were infirm. The CA noted that even the Cagampang spouses recognized these
infirmities, and instead of denying their existence, they tried to justify the same and seek an exception
therefrom.

On the alleged donation of Parcel F-5 by Don Fabian to Reygula Monteroso-Bayan, the CA likewise agreed
with the RTC’s finding on the nullity thereof. The CA pointed out that Reygula Monteroso-Bayan did not
controvert the RTC’s finding, except to gratuitously say that the trial court’s declaration of nullity was wrong
since nobody questioned the authenticity of the donation in the first place.

Apropos Parcel S-1, a disposable agricultural land of the public domain which is the subject of a homestead
patent application by Don Fabian, the CA, as opposed to the RTC’s disposition, held that a patent, if eventually
issued, ought to be in the name of the legal heirs of Don Fabian, not of his surviving spouse, Pendejito. This
conclusion, so the CA explained, is in line with the provision of Section 105 of the Public Land Act or
Commonwealth Act No. 141 (CA 141), as amended.

As to Parcel S-2, the CA agreed with the RTC that it is a conjugal property acquired during the second
marriage through a deed of sale14 executed on August 15, 1947 by Marcelo Morancel. Likewise, the CA said
that Parcels S-3 and S-4 are conjugal properties as no evidence was adduced supporting the alleged purchase
by Pendejito of said properties with her own funds.

Anent the RTC’s order partitioning Parcel F-6, the CA agreed with the defendants in Civil Case No. 1332 that
Parcel F-6 has long been partitioned equitably among all the eight children of Don Fabian. Thus, the CA further
modified the RTC on this point.

On the third and last issues, the CA set aside all awards of actual damages made by the RTC premised on the
income generating capacity of the subject properties, except that of Parcel F-4, as an order of accounting of the
fruits of the other subject properties unjustly appropriated by them would address the issue of damages.

It bears to stress at this juncture that, save for the grant of damages and the disposition of Parcels F-6 and S-1,
the CA affirmed the questioned RTC Decision on all other points. On June 15, 1992, Tirso D. Monteroso
thereafter filed before the Court his partial petition for review under Rule 45, docketed as G.R. No. 105608.
On the other hand, Pendejito, together with the other defendants in Civil Case No. 1332, first interposed a joint
motion for partial reconsideration, which the CA denied per its equally assailed December 16, 1993
Resolution,15before elevating the case via a petition for review under Rule 45, docketed as G.R. No. 113199.

G.R. No. 105608 Denied with Finality

Per its Resolution16 dated June 29, 1992, the Court denied Tirso D. Monteroso’s petition under G.R. No.
105608 for late payment of fees and non-compliance with the requirements of the Rules of Court and Circular
Nos. 1-88 and 28-91 on the submission of a certified copy of the assailed decision/order and a certification of
non-forum shopping. Another Resolution17 of August 12, 1992 followed, this time denying with finality Tirso D.
Monteroso’s motion for reconsideration filed on July 29, 1992. On August 31, 1992, an Entry of Judgment18 was
issued.

In net effect, the March 31, 1992 CA Decision in CA-G.R. CV No. 15805 is final and executory as to Tirso D.
Monteroso, and the Court need not pass upon the issues he raised in his petition under G.R. No.
105608, albeit we shall take stock of his Comment19 and Memorandum20 in G.R. No. 113199.

The Issues

Petitioners in G.R. No. 113199 raise the following issues for our consideration:

1. Whether the finding that the Deeds of Sale (Exhibits "C", "D" and "E") were not supported by
valuable consideration and sham, fictitious and simulated is supported by the evidence.

2. Whether the finding or conclusion that petitioners Spouses Atty. Perfecto and Soledad Cagampang
did not dispute the finding of the trial Court that the Deeds of Sale in question are sham, fictitious and
simulated is supported by evidence.

3. Whether the [CA] committed reversible error in concluding that, "By invoking the benefits of
prescription in their favor, the Cagampang spouses are deemed to have admitted the existence of a
co-ownership."

4. Whether the [CA] committed reversible error in upholding partition as the proper remedy of private
respondent Tirso Monteroso to recover the properties sold by Fabian Monteroso, Sr. to Soledad D.
Monteroso de Cagampang when co-ownership is not pleaded as theory in the Complaint.

5. Whether the [CA] committed reversible error in holding that the cause of action of private
respondent Tirso Monteroso is not barred by extinctive prescription and laches.

6. Whether the [CA] committed reversible error in granting reliefs not prayed for in the Complaint in
favor of parties who did not assert or claim such relief, such as partition and accounting among the
parties and the nullification of the donation in favor of petitioner Reygula Bayan when x x x Tirso
Monteroso and the petitioners herein who are signatories to the Deed of Donation did not question or
ask for the nullification of the donation in favor of Reygula Bayan.

7. Whether the [CA] committed reversible error in ordering the partition of parcels S-1, S-2, S-3 and S-
4 which are admitted in the Complaint to be in the exclusive, adverse possession of petitioners Sofia
vda. de Monteroso, Florenda, Alberto and Reynato and the Heirs of Fabian Monteroso, Jr. since the
death of Fabian Monteroso, Sr. in 1948, appropriating the harvests unto themselves, to the exclusion
of plaintiff (private respondent Tirso Monteroso) who was deprived of his share continuously up to the
present.21

The Court’s Ruling


After a circumspect consideration of the arguments earnestly pressed by the parties and in the light of the
practically parallel findings of the RTC and CA, we find the petition under G.R. No. 113199 to be devoid of
merit.

It is a rule of long standing that:

[T]he jurisdiction of the Court in cases brought before it from the Court of Appeals via Rule 45 of the
Rules of Court is limited to reviewing errors of law. Findings of fact of the latter are conclusive, except
in the following instances: (1) when the findings are grounded entirely on speculation, surmises, or
conjectures; (2) when the inference made is manifestly mistaken, absurd, or impossible; (3) when
there is grave abuse of discretion; (4) when the judgment is based on a misapprehension of facts; (5)
when the findings of fact are conflicting; (6) when in making its findings the Court of Appeals went
beyond the issues of the case, or its findings are contrary to the admissions of both the appellant and
the appellee; (7) when the findings are contrary to those of the trial court; (8) when the findings are
conclusions without citation of specific evidence on which they are based; (9) when the facts set forth
in the petition as well as in the petitioner’s main and reply briefs are not disputed by the respondent;
and (10) when the findings of fact are premised on the supposed absence of evidence and
contradicted by the evidence on record.22

None of the above exceptions, however, obtains in the instant case.

First and Second Issues: Simulated Sale

In connection with the first two related issues, petitioners maintain that the CA erred when it affirmed the RTC’s
conclusion on the fictitious or simulated nature, for lack or inadequate consideration, of the Deeds of Sale
(Exhibits "C," "D," and "E"), noting that Tirso failed to present substantial evidence to support the alleged
infirmity of the underlying sale. The fact that one of the lots sold under Exhibit "C" on May 10, 1939 for PhP
2,500 was used as collateral for a PhP 600 loan is not, so petitioners claim, proof that the amount of PhP 600
represents the maximum loan value of the property or that the sale in question is not supported by valuable
consideration.

Moreover, petitioners belabored to explain that the trial court erred in concluding that the property conveyed
under Exhibit "C" and covered by Transfer Certificate of Title (TCT) No. RT-203 (420) in the name of Soledad
Monteroso-Cagampang, married to Perfecto, was fictitious on the ground that the certificate did not indicate
that it was a conjugal property. Petitioners assert that the registration of a property only in the name of one of
the spouses is not proof that no consideration was paid therefor. As petitioners would stress, what determines
whether a given property is conjugal or separate is the law itself, not what appears in the certificate of title.

Lastly, petitioners take exception from the appellate court’s posture that the Cagampang spouses did not
dispute the trial court’s finding that the deeds of sale (Exhibits "C," "D," and "E") were simulated and fictitious
for lack of consideration. Petitioners insist that they in fact contested such conclusion of the RTC in their brief
before the CA, adding they only raised the issue of prescription as an alternative defense without conceding the
RTC’s findings on contract infirmity.

We are not persuaded.

The antecedent facts, as borne by the records, strongly indicate the simulated character of the sale covered by
the deeds of absolute sale over Parcels F-1 (Exhibit "C"), F-2 (Exhibit "D"), F-3, F-5, F-7, and F-8 (Exhibit "E").
As found below, Don Fabian never relinquished possession of the covered properties during his lifetime. The
first deed, Exhibit "E," was executed on May 1, 1939; the second, Exhibit "C," on May 10, 1939; and the third,
Exhibit "D," on September 24, 1939. Soledad Monteroso-Cagampang, however, only took possession of the
subject properties after Don Fabian’s death in 1948 or nine years after contract execution. The gap,
unexplained as it were, makes for a strong case that the parties to the sale never intended to be bound
thereby.
The more telling circumstance, however, is the fact that Perfecto had judicially sought the amendment of the
corresponding TCTs so that only the name of his wife, Soledad, shall be inscribed as real party-in-interest on
the Memorandum of Encumbrances at the back portion of the titles. If only to stress the point, when the deeds
were executed in 1939, Soledad and Perfecto Cagampang, the notarizing officer, were already married.

A property acquired during the existence of a marriage is presumed conjugal. This postulate notwithstanding,
Perfecto Cagampang went out of his way to make it appear that the subject parcels of land were effectively his
wife’s paraphernal properties. No explanation was given for this unusual move.

Hence, we agree with the trial and appellate courts that the unexplained situations described above sufficiently
show that the purported conveyances were simulated. We also accord credence to Tirso’s allegation that the
Cagampang spouses tricked Don Fabian into believing that his creditors were after the properties which have
to be "hidden" by means of simulated conveyances to Soledad Monteroso-Cagampang. The fact that only one
of the subject lots was used as collateral for a PhP 600 loan which the Cagampang spouses took out does not
weaken the conclusion on the simulated character of the contracts, as logically drawn from the twin
circumstances adverted to.

The Court can allow that petitioners indeed attempted to traverse, before the CA, the RTC’s findings on the
area of simulated sale and that they only raised the matter of acquisitive prescription as an alternative defense.
However, as we shall explain shortly, the fact of petitioners having made the attempt aforestated will not carry
the day for them.

Third Issue: Recognition of Co-ownership in Acquisitive Prescription

In its assailed decision, the CA declared, "By invoking the benefits of prescription in their favor, the Cagampang
spouses are deemed to have admitted the existence of a co-ownership x x x." The petitioners tag this
declaration as flawed since the benefit of prescription may be availed of without necessarily recognizing co-
ownership. Prescription and co-ownership, they maintain, are so diametrically opposed legal concepts, such
that one who invokes prescription is never deemed to admit the existence of co-ownership.

Petitioners are mistaken; their error flows from compartmentalizing what the CA wrote. The aforecited portion of
the CA’s decision should not have been taken in isolation. It should have been read in the context of the
appellate court’s disquisition on the matter of Tirso being a co-owner of the subject undivided properties whose
rights thereto, as a compulsory heir, accrued at the moment of death of Don Fabian, vis-à-vis the defense of
acquisitive prescription foisted by the Cagampang spouses. For clarity, we reproduce the pertinent portion of
the assailed decision:

Nor do we find any merit in the third. From the allegation in the Complaint in Civil Case No. 1332 as
well as from the arguments advanced by the parties on the issues raised therein, this Court is
convinced that therein plaintiff Tirso Monteroso’s principal cause of action is unmistakably one for
partition which by its very nature is imprescriptible and cannot be barred by laches x x x. The only
exception to the rule on the imprescriptibility of an action for partition is provided in a case where the
co-ownership of the properties sought to be partitioned had been properly repudiated by a co-owner at
which instance the remedy available to the aggrieved heirs lies not in action for partition but for
reconveyance which is subject to the rules on extinctive prescription. By invoking the benefits of
prescription in their favor, the Cagampang spouses are deemed to have admitted the existence
of a co-ownership among the heirs of Fabian Monteroso, Sr. over the properties forming the
decedent’s estate.23 (Emphasis ours.)

From the foregoing disquisition, what the appellate court tried to convey is clear and simple: partition is the
proper remedy available to Tirso who is a co-owner of the subject properties by virtue of his being a
compulsory heir, like siblings Soledad, Reygula, and Benjamin, of Don Fabian. The right to seek partition is
imprescriptible and cannot be barred by laches. Consequently, acquisitive prescription or laches does not lie in
favor of the Cagampang spouses and against Tirso, the general rule being that prescription does not run
against a co-owner or co-heir. The only exception to the imprescriptibility of an action for partition against a co-
owner is when a co-owner repudiates the co-ownership. Thus, the appellate court ruled that by invoking
extinctive prescription as a defense, the lone exception against imprescriptibility of action by a co-owner, the
Cagampang spouses are deemed to have contextually recognized the co-ownership of Tirso and must have
repudiated such co-ownership in order for acquisitive prescription to set in. Taking off from that premise, the
appellate court then proceeded to tackle the issue of repudiation by the Cagampang spouses. Therefore, we
hold that the appellate court did not err in finding that the Cagampang spouses are effectively barred from
invoking prescription, given that the subject properties are conjugal properties of the decedent, Don Fabian,
which cannot be subjected to acquisitive prescription, the necessary consequence of recognizing the co-
ownership stake of other legal heirs.

Fourth and Fifth Issues: Partition Proper, not Barred by Laches


nor by Acquisitive Prescription

Being inextricably intertwined, we tackle both issues together. Petitioners, citing Article 494 of the Civil
Code24 and Art. 1965 of the Spanish Civil Code, aver that the right to ask partition is proper only where co-
ownership is recognized. They also suggest that no co-ownership obtains in this case considering that no less
than Tirso avers in his complaint in Civil Case No. 1332 that from the time of Don Fabian’s death in 1948, the
lots in question have been in the exclusive, adverse, and public possession of the Cagampang spouses.
Assayed against this perspective, petitioners submit that partition is not proper, ergo unavailing, but an action
for reconveyance which is subject to the rules on extinctive prescription.

Corollary to the posture above taken, petitioners assert that there being no co-ownership over the properties
sold by Don Fabian to Soledad Monteroso-Cagampang, Tirso’s cause of action, under the Code of Civil
Procedure (Act No. 190) in relation to Art. 1116 of the Civil Code,25 had already prescribed, either in 1949, i.e.,
10 years after the subject properties were registered in Soledad Monteroso-Cagampang’s name, or in 1958,
i.e., 10 years after the cause of action accrued in 1948 (death of Don Fabian), citing Osorio v. Tan.26 Tirso’s
complaint in Civil Case No. 1332 was commenced in 1970.

Petitioners contend that the evidence adduced clearly demonstrates that Soledad Monteroso-Cagampang
acquired ownership of the subject properties by virtue of the deeds of sale executed in 1939 by Don Fabian.
After the sale, she registered them under her name and then took exclusive, adverse, and public possession
over them. Thus, they submit that the prescriptive period applicable to the instant case under Act No. 190 had
long expired, adding that the CA erred in finding that Soledad Monteroso-Cagampang repudiated the co-
ownership only in 1961 when she and the other heirs ignored the demand of Tirso for partition.

As a final point, petitioners alleged that the exclusion of Tirso from the enjoyment of the fruits of the subject
properties since after the death of Don Fabian in 1948 is consistent with Soledad Monteroso-Cagampang’s
claim of exclusive ownership and dominion.

We cannot subscribe to petitioners’ theory.

The fact that Tirso and the other compulsory heirs of Don Fabian were excluded from the possession of their
legitime and the enjoyment of the fruits thereof does not per se argue against the existence of a co-ownership.
While Tirso may not have expressly pleaded the theory of co-ownership, his demand from, and act of initiating
Civil Case No. 1332 against, the Cagampang spouses for his share necessarily implies that he was asserting
his right as co-owner or co-heir of the properties unjustly withheld by the Cagampang spouses through the
instrumentality of simulated deeds of sale covering some of the hereditary properties. By asserting his right as
a compulsory heir, Tirso has effectively brought into the open the reality that the Cagampang spouses were
holding some of the subject properties in trust and that he is a co-owner of all of them to the extent of his legal
share or legitime thereon.

Consequently, we are one with the trial and appellate courts that partition is the proper remedy for compulsory
or legal heirs to get their legitime or share of the inheritance from the decedent. An action for partition is at once
an action for declaration of co-ownership and for segregation and conveyance of a determinate portion of the
properties involved.27 Also, Sec. 1, Rule 69 of the Rules of Court pertinently provides:

SECTION 1. Complaint in action for partition of real estate. –– A person having the right to compel
the partition of real estate may do so as provided in this Rule, setting forth in his complaint the
nature and extent of his title and an adequate description of the real estate of which partition is
demanded and joining as defendants all other persons interested in the property. (Emphasis ours.)

Being a compulsory heir of Don Fabian, Tirso has the right to compel partition of the properties comprising the
intestate estate of Don Fabian as a measure to get his hereditary share. His right as an heir to a share of the
inheritance covers all the properties comprising the intestate estate of Don Fabian at the moment of his
death,28 i.e., on October 26, 1948. Before partition and eventual distribution of Don Fabian’s intestate estate, a
regime of co-ownership among the compulsory heirs existed over the undivided estate of Don Fabian. Being a
co-owner of that intestate estate, Tirso’s right over a share thereof is imprescriptible.29 As a matter of law,
acquisitive prescription does not apply nor set in against compulsory heirs insofar as their pro-indiviso share or
legitime is concerned, unless said heirs repudiate their share.30 Contrary to petitioners’ stance, reconveyance is
not the proper remedy available to Tirso. Be it remembered in this regard that Tirso is not asserting total
ownership rights over the subject properties, but only insofar as his legitime from the intestate estate of his
father, Don Fabian, is concerned.

Acquisitive prescription, however, may still set in in favor of a co-owner, "where there exists a clear repudiation
of the co-ownership, and the co-owners are apprised of the claim of adverse and exclusive ownership."31 In the
instant case, however, no extinctive or acquisitive prescription has set in against Tirso and other compulsory
heirs in favor of the Cagampang spouses because effective repudiation had not timely been made against the
former. As aptly put by the appellate court, the repudiation which must be clear and open as to amount to an
express disavowal of the co-ownership relation happened not when the deeds of absolute sale were executed
in 1939, as these could not have amounted to a clear notice to the other heirs, but in 1961 when the
Cagampang spouses refused upon written demand by Tirso for the partition and distribution of the intestate
estate of Don Fabian. Since then, Tirso was deemed apprised of the repudiation by the Cagampang spouses.

However, considering that the new Civil Code was already then in effect, Art. 1141 of said Code 32 applies; thus,
Tirso has at the very least 10 years and at the most 30 years to file the appropriate action in court. The records
show that Tirso’s cause of action has not prescribed as he instituted an action for partition in 1970 or only nine
years after the considered express repudiation. Besides, acquisitive prescription also does not lie against Tirso
even if we consider that a valid express repudiation was indeed made in 1961 by the Cagampang spouses
since in the presence of evident bad faith, the required extraordinary prescription period33 of 30 years has not
yet lapsed, counted from said considered repudiation. Such would still be true even if the period is counted
from the time of the death of Don Fabian when the Cagampang spouses took exclusive possession of the
subject properties.

Sixth Issue: Partition Proper for Conjugal Properties


of Second Marriage

On the ground of prescription under Act No. 190, petitioners assert that Tirso lost the right to seek the partition
of Parcels S-1, S-2, S-3, and S-4, he having admitted, as early as 1948, the adverse, exclusive, and public
possession thereof by Pendejito and her children. This type of possession, they maintain, works as a
repudiation by Pendejito and her children of the co-ownership claim of Tirso. They further argue that Parcel S-1
pertains to Pendejito as her paraphernal property since the homestead application therefor was under her
name.

We are not persuaded.

Tirso’s acknowledgment of Pendejito and her children’s possession of Parcels S-1, S-2, S-3, and S-4 cannot be
viewed as the required repudiation to bar Tirso from pursuing his right to seek partition. Under the law on co-
ownership, it behooves on the person desiring to exclude another from the co-ownership to do the repudiating.
Verily, the records do not show that Pendejito and her children performed acts clearly indicating an intention to
repudiate the co-ownership and then apprising Tirso and other co-owners or co-compulsory heirs of such
intention.

To be sure, Tirso and his siblings from the first marriage have a stake on Parcels S-2, S-3, and S-4, even if
these parcels of land formed part of the conjugal partnership of gains of the second marriage. There can be no
serious dispute that the children of the first marriage have a hereditary right over the share of Don Fabian in the
partnership assets of the first marriage.

Anent Parcel S-1, we join the CA in its holding that it belongs to the heirs of Don Fabian under Sec. 105 of CA
141, which pertinently provides:

Sec. 105. If at any time the applicant or grantee shall die before the issuance of the patent or the final
grant of the land, or during the life of the lease, or while the applicant or grantee still has obligations
pending towards the Government, in accordance with this Act, he shall be succeeded in his rights
and obligations with respect to the land applied for or granted or issued under this Act by his
heirs in law, who shall be entitled to have issued to them the patent or final concession if they
show that they have complied with the requirements therefor, and who shall be subrogated in all his
rights and obligations for the purposes of this Act. (Emphasis ours.)

It is undisputed that Don Fabian was the homestead patent applicant who was subrogated to the rights of the
original applicants, spouses Simeon Cagaanan and Severina Naranjo, by purchasing from the latter Parcel S-1
on May 8, 1943. Don Fabian cultivated the applied area and declared it for taxation purposes. The application,
however, would be rejected because death supervened. In 1963, Pendejito filed her own homestead
application for Parcel S-1.

Assayed against the foregoing undisputed facts in the light of the aforequoted Sec. 105 of CA 141, the heirs of
Don Fabian are entitled to Parcel S-1. Said Sec. 105 has been interpreted in Soliman v. Icdang34 as having
abrogated the right of the widow of a deceased homestead applicant to secure under Sec. 3 of Act No. 926,
otherwise known as the Public Land Act of 1903, a patent in her own name, thus:

[W]e should bear in mind that, although Adolfo Icdang was married to plaintiff when he filed the
homestead application, "an applicant may be said to have acquired a vested right over a homestead
only by the presentation of the final proof and its approval by the Director of Lands". (Ingara vs.
Ramelo, 107 Phil., 498; Balboa vs. Farrales, 51 Phil., 498; Republic vs. Diamon, 97 Phil., 838.) In the
case at bar, the final proof appears to have been presented to, and approved by the Director of Lands,
in 1954, or several years after the death of Adolfo Icdang and the dissolution of his conjugal
partnership with plaintiff herein. Hence, the land in question could not have formed part of the assets of
said partnership. It belonged to the heirs of Adolfo Icdang, pursuant to section 105 of Commonwealth
Act No. 141, reading:

xxxx

It is worthy of notice that, under the Public Land Act of 1903 (Act No. 926, section 3), "in the event of
the death of an applicant prior to the issuance of a patent, his widow shall be entitled to have a patent
for the land applied for issue to her upon showing that she has consummated the requirements of law
for homesteading the lands", and that only in case the deceased applicant leaves no widow shall his
interest in the land descend and the patent issue to his legal heirs. Incorporated substantially in section
103 of the Public Land Act of 1919 (Act No. 2874), this policy was changed by Act No. 3517, pursuant
to which the deceased shall be succeeded no longer by his widow, but "by his heirs in law, who shall
be entitled to have issued to them the patent—if they show that they have complied with the
requirements therefor". And this is, in effect, the rule maintained in the above quoted section 105 of
Commonwealth Act No. 141.35 (Emphasis added.)

It appearing that Don Fabian was responsible for meeting the requirements of law for homesteading Parcel S-
1, said property, following Soliman, cannot be categorized as the paraphernal property of Pendejito. Thus, the
homestead patent thereto, if eventually issued, must be made in the name of the compulsory heirs of Don
Fabian. Over it, Pendejito shall be entitled, pursuant to Art. 834 of the Spanish Civil Code of 1889, only to a
usufructuary right over the property equal to the corresponding share of each of Don Fabian’s compulsory
heirs, i.e., his eight children.
Seventh Issue: Judgment Must not Only be Clear but
Must Also be Complete

Petitioners bemoan the fact that both the trial and appellate courts granted relief and remedies not prayed for
by the parties. As argued, Civil Case No. 1292, initiated by the heirs of Benjamin against Tirso, basically sought
recovery of real properties; while Civil Case No. 1332, a countersuit filed by Tirso, was for partition and
damages, the main thrust of which is to recover his alleged share from properties in the exclusive possession
and enjoyment of other heirs since the death of Don Fabian in 1948. Thus, petitioners take issue against both
decisions of the trial and appellate courts which ordered partition not only in favor of Tirso but also in favor of
the other petitioners he sued. What is particularly appalling, according to them, is the order for accounting
which no one requested.

Petitioners’ lament, while understandable, is specious. Our judicial system requires courts to apply the law and
grant remedies when appropriately called for by law and justice. In the exercise of this mandate, courts have
the discretion to apply equity in the absence or insufficiency of the law. Equity has been defined as justice
outside law, being ethical rather than jural and belonging to the sphere of morals than of law. It is grounded on
the precepts of conscience and not on any sanction of positive law, for equity finds no room for application
where there is law.36

In the instant case, a disposition only ordering partial partition and without accounting, as petitioners presently
urge, would be most impractical and against what we articulated in Samala v. Court of Appeals.37 There, we
cautioned courts against being dogmatic in rendering decisions, it being preferable if they take a complete view
of the case and in the process come up with a just and equitable judgment, eschewing rules tending to frustrate
rather than promote substantial justice.

Surely, the assailed path taken by the CA on the grant of relief not specifically sought is not without precedent.
In National Housing Authority v. Court of Appeals, where the petitioner questioned the competence of the
courts a quo to resolve issues not raised in the pleadings, and to order the disposition of the subject property
when what was raised was the issue of right to possession, this Court in dismissing the challenge stated that "a
case should be decided in its totality, resolving all interlocking issues in order to render justice to all concerned
and to end the litigation once and for all."38 Verily, courts should always strive to settle the entire controversy in
a single proceeding leaving no root or branch to bear the seed of future litigation.39

Eighth Issue: Deed of Donation Null and Void

Finally, as an incidental issue, petitioners asseverate that the deed of donation (Exhibit "F") executed on
September 19, 1948, or after the death of Don Fabian, in favor of Reygula M. Bayan, is valid, particularly so
since Tirso and the heirs of Benjamin, as represented by their mother, Nakila, do not question the validity of
said deed as they in fact signed the same. That the donated property was the same property described and
included in the deed of sale (Exhibit "E") in favor of Soledad Monteroso-Cagampang is not, they contend, an
invalidating factor since what Don Fabian sold under Exhibit "E" did not extend beyond his conjugal share
thereon.

Just like the issue of the nullity of the three deeds of absolute sale (Exhibits "C," "D," and "E") heretofore
discussed, we agree with the determination of the RTC and CA as to the invalidity of the donation of Parcel F-5
to Reygula M. Bayan. We need not repeat the reasons for such determination, except the most basic. We refer
to the authority of the person who executed the deed of donation. As it were, the widow of Benjamin, Nakila,
signed the deed of donation. She, however, cannot give consent to the donation as she has no disposable right
thereto. The legal maxim nemo dat quod non habet40 applies to this instance as Nakila only has usufructuary
right equal to the share of her children under Art. 834 of the Spanish Civil Code of 1889. Besides, Nakila signed
the deed of donation in her name and not in the name of her children who are the heirs in representation of
their father, Benjamin. Lest it be overlooked, the then minor children were not under the legal guardianship of
Nakila, a situation which thus disqualifies her from signing on their behalf.

The fact that nobody objected to the donation is of little consequence, for as the CA aptly observed, "The
circumstance that parties to a void contract choose to ignore its nullity can in no way enhance the invalid
character of such contract. It is axiomatic that void contracts cannot be the subject of ratification, either express
or implied."41

WHEREFORE, the petition in G.R. No. 113199 is DENIED for lack of merit. The assailed Decision and
Resolution dated March 31, 1992 and December 16, 1993, respectively, of the CA in CA-G.R. CV No. 15805
are hereby AFFIRMED IN TOTO. Costs against the petitioners.
G.R. No. 171628 June 13, 2011

ARMANDO V. ALANO [Deceased], Substituted by Elena Alano-Torres,* Petitioner,


vs.
PLANTER'S DEVELOPMENT BANK, as Successor-in-Interest of MAUNLAD SAVINGS and LOAN
ASSOCIATION, INC.,*** Respondent.

DECISION

DEL CASTILLO, J.:

"No one can give what he does not have" (Nemo dat quod non habet).

This Amended Petition for Review on Certiorari1 under Rule 45 of the Rules of Court assails the June 9, 2005
Decision2 and the February 21, 2006 Resolution3 of the Court of Appeals (CA) in CA G.R. CV No. 58554.

Factual Antecedents

Petitioner Armando V. Alano and his brother, the late Agapito V. Alano, Jr., inherited from their father a parcel
of land located at Gov. Forbes St., Sampaloc, Manila.4

On June 30, 1988, petitioner executed a Special Power of Attorney5 authorizing his brother to sell their property
in Manila. From the proceeds of the sale, the brothers purchased on September 22, 1988 a residential house
located at No. 60 Encarnacion St., BF Homes, Quezon City.6 The title of the Quezon City property, however,
was not immediately transferred to them because the duplicate and original copies of the title were destroyed
by a fire that gutted the Quezon City Hall Building.7

On June 27, 1990, Agapito V. Alano, Jr. died leaving behind his wife, Lydia J. Alano (Lydia), and four legitimate
children, who adjudicated to themselves the property in Quezon City.8 Consequently, title to the said property
was reconstituted as Transfer Certificate of Title (TCT) No. 18990 and registered solely in the names of Lydia
and her four children.9 This prompted petitioner to execute an Affidavit of Adverse Claim10 which was annotated
on TCT No. 18990.11 But because of the assurance of his nieces that they would put things right, petitioner
agreed to delay the filing of a case in court.12

Meanwhile, Lydia filed with the Register of Deeds of Quezon City an Affidavit of Cancellation of Adverse
Claim,13which caused the cancellation of the adverse claim annotated on TCT No. 18990.14 Thereafter, by virtue
of a Deed of Absolute Sale15 allegedly executed by her children in her favor, TCT No. 18990 was cancelled and
a new one, TCT No. 90388, was issued solely in her name.16

On February 8, 1994, Slumberworld, Inc., represented by its President, Melecio A. Javier, and Treasurer,
Lydia, obtained from Maunlad Savings and Loan Association, Inc. a loan of ₱2.3 million, secured by a Real
Estate Mortgage17 over the property covered by TCT No. 90388.18

On April 20, 1994, petitioner filed a Complaint19 against Lydia, Melecio A. Javier, Maunlad Savings and Loan
Association, Inc. and the Register of Deeds of Quezon City before the Regional Trial Court (RTC) of Quezon
City, which was raffled to Branch 92. Petitioner sought the cancellation of TCT No. 90388, the issuance of a
new title in his name for his one-half share of the Quezon City property, and the nullification of real estate
mortgage insofar as his one-half share is concerned.20

Defendants Maunlad Savings and Loan Association, Inc. and the Register of Deeds of Quezon City filed their
respective Answers.21 Defendants Lydia and Melecio A. Javier, however, failed to file their respective Answers.
Thus, the RTC in an Order22 dated August 29, 1994 declared them in default.

Ruling of the Regional Trial Court


On September 12, 1996, the RTC rendered its Decision23 declaring petitioner the owner of one-half of the
subject property since an implied trust exists between him and the heirs of his brother. 24 The RTC, however,
sustained the validity of the real estate mortgage.25 According to the RTC, Maunlad Savings and Loan
Association, Inc. had the right to rely on the Torrens title as there was no reason for it to doubt the mortgagor’s
ownership over the subject property.26 Accordingly, the fallo of the decision reads:

WHEREFORE, premises considered, judgment is hereby rendered as follows:

1. Declaring plaintiff Armando Alano the owner of one-half of the property in question;

2. Ordering the Register of Deeds of Quezon City to cancel TCT No. 90388 issued in the name of
Lydia J. Alano and the corresponding owner’s duplicate certificate and to issue a new one in the
names of Armando V. Alano, single[,] ½ share pro indiviso and Lydia Alano, widow, ½ share pro
indiviso with the corresponding mortgage lien annotation in favor of the Maunlad Savings and Loan
[Association,] Inc. upon finality of this decision;

3. Ordering the defendant Maunlad Savings and Loan [Association,] Inc. to surrender [the] owner’s
duplicate copy of TCT No. 90388 to the Register of Deeds of Quezon City for cancellation upon finality
of this decision;

4. Ordering defendants Lydia J. Alano and Melecio Javier to jointly and severally pay the plaintiff the
sum of ₱20,000.00 as attorney’s fees and to pay the costs of suit.

SO ORDERED.27

Dissatisfied, petitioner moved for partial reconsideration28 but the RTC denied the same in its Order29 dated
February 24, 1997.

Ruling of the Court of Appeals

Petitioner appealed30 to the CA but to no avail. The CA found Maunlad Savings and Loan Association, Inc. to
be a mortgagee in good faith since it took the necessary precautions to ascertain the status of the property
sought to be mortgaged as well as the identity of the mortgagor by conducting an ocular inspection of the
property and requiring the submission of documents, such as the latest tax receipts and tax clearance. 31 The
CA thus disposed of the appeal as follows:

WHEREFORE, premises considered, the appeal is hereby DISMISSED for lack of merit. The September 12,
1996 Decision of the Regional Trial Court of Quezon City, Branch 92, is hereby AFFIRMED.

SO ORDERED.32

Petitioner sought reconsideration33 but the CA denied the same in its Resolution34 dated February 21, 2006.

Issues

Hence, the present recourse, petitioner raising the following issues:

I. WHETHER THE REAL ESTATE MORTGAGE EXECUTED BY DEFENDANT LYDIA J. ALANO


WAS VALID AND BINDING WITH RESPECT TO PETITIONER’S CO-OWNER’S SHARE IN THE
SUBJECT PROPERTY.

II. WHETHER DEFENDANT MAUNLAD SAVINGS AND LOAN ASSOCIATION, INC. WAS AN
INNOCENT MORTGAGEE IN GOOD FAITH.
III. WHETHER PETITIONER MAY RIGHTFULLY BE MADE TO SUFFER THE CONSEQUENCES OF
DEFENDANT LYDIA J. ALANO’S WRONGFUL ACT OF MORTGAGING THE SUBJECT
PROPERTY.35

Petitioner’s Arguments

Petitioner insists that Maunlad Savings and Loan Association, Inc. is not a mortgagee in good faith as it failed
to exercise due diligence in inspecting and ascertaining the status of the mortgaged property. Petitioner calls
attention to the testimony of Credit Investigator Carlos S. Mañosca, who admitted that when he inspected the
mortgaged property, he only checked the finishing of the house and the number of rooms.36 Hence, he failed to
see petitioner’s apartment at the back portion of the property.37 Moreover, the fact that there was an adverse
claim annotated on the previous title of the property should have alerted Maunlad Savings and Loan
Association, Inc. to conduct further investigation to verify the ownership of the mortgaged property.38 All these
prove that Maunlad Savings and Loan Association, Inc. was not a mortgagee in good faith. Corollarily, pursuant
to Articles 208539 and 49340 of the Civil Code, the real estate mortgage executed by Lydia is void insofar as
petitioner’s share in the mortgaged property is concerned.41

Respondent’s Arguments

Respondent contends that the issue of whether Maunlad Savings and Loan Association, Inc. is a mortgagee in
good faith is a question of fact, which is beyond the jurisdiction of this Court.42 As to petitioner’s allegation that
there was a separate apartment at the back portion of the property, respondent claims that this was never
raised during the trial or on appeal.43 Hence, it is barred by estoppel.44

Respondent further claims that Maunlad Savings and Loan Association, Inc. has no obligation to look beyond
the title considering that there was no adverse claim annotated on TCT No. 90388 covering the mortgaged
property.45And since the mortgaged property was occupied by the mortgagor Lydia, there was also no need for
Maunlad Savings and Loan Association, Inc. to verify the extent of her possessory rights. 46

Our Ruling

The petition has merit.

The instant case is an exception to the rule that factual issues may not be raised in a petition under Rule 45 of
the Rules of Court.

The rule that only questions of law may be raised in a petition for review on certiorari under Rule 45 of the
Rules of Court is not without exception. A review of factual issues is allowed when there is a misapprehension
of facts or when the inference drawn from the facts is manifestly mistaken.47 This case falls under exception.

Maunlad Savings and Loan Association, Inc. is not a mortgagee in good faith.

The general rule that a mortgagee need not look beyond the title does not apply to banks and other financial
institutions as greater care and due diligence is required of them.48 Imbued with public interest, they "are
expected to be more cautious than ordinary individuals."49 Thus, before approving a loan, the standard practice
for banks and other financial institutions is to conduct an ocular inspection of the property offered to be
mortgaged and verify the genuineness of the title to determine the real owner or owners thereof. 50 Failure to do
so makes them mortgagees in bad faith.

In this case, petitioner contends that Maunlad Savings and Loan Association, Inc. failed to exercise due
diligence in inspecting and ascertaining the status of the mortgaged property because during the ocular
inspection, the credit investigator failed to ascertain the actual occupants of the subject property and to
discover petitioner’s apartment at the back portion of the subject property.51
Indeed, the existence of petitioner’s apartment at the back portion of the subject property was never brought up
before the trial court and the appellate court. Nevertheless, we find petitioner’s allegation of negligence
substantiated by the testimony of the credit investigator, to wit:

ATTY. JAVELLANA

xxxx

Q - You said also that you inspected the property that was offered as collateral which is a house and lot located
at Encarnacion Street, BF Homes. Did you enter the property?

A - Yes, ma’am.

Q - And then you found out that the property was the home of Mrs. Lydia Alano and her children?

A - Yes, ma’am.

ATTY. JAVELLANA

Q - And you also saw that her brother-in-law Armando Alano was also residing there?

A - I do not recall if he was there, ma’am.

Q - You did not see him there?

A - When we went there ma’am, we only checked on the finishing of the house and also checked as to the
number of bedrooms and number of CR, ma’am.

Q - You did not verify who were actually residing there?

A - No, ma’am.

Q - You said that you also conducted a neighborhood checking, did you ask the neighbor who were residing in
that property?

A - Yes, and we were told that Lydia Alano was the one residing there, ma’am.

Q - You did not verify from them as to whether anybody else was residing there?

A - No, ma’am.52 (Emphasis supplied).

Clearly, while the credit investigator conducted an ocular inspection of the property as well as a "neighborhood
checking" and found the subject property occupied by the mortgagor Lydia and her children,53 he, however,
failed to ascertain whether the property was occupied by persons other than the mortgagor. Had he done so,
he would have discovered that the subject property is co-owned by petitioner and the heirs of his brother. Since
Maunlad Savings and Loan Association, Inc. was remiss in its duty in ascertaining the status of the property to
be mortgaged and verifying the ownership thereof, it is deemed a mortgagee in bad faith. Consequently, the
real estate mortgage executed in its favor is valid only insofar as the share of the mortgagor Lydia in the
subject property. We need not belabor that under Article 49354 of the Civil Code, a co-owner can alienate only
his pro indiviso share in the co-owned property, and not the share of his co-owners.1âwphi 1

WHEREFORE, the petition is hereby GRANTED. The assailed June 9, 2005 Decision and the February 21,
2006 Resolution of the Court of Appeals in CA G.R. CV No. 58554 are SET ASIDE. The September 12, 1996
Decision of the Regional Trial Court of Quezon City, Branch 92, is hereby MODIFIED by declaring the
mortgage in favor of respondent Maunlad Savings and Loan Association, Inc. NULL and VOID insofar as the ½
share of petitioner in the subject property is concerned, and ordering the annotation of the mortgage lien in
favor of respondent only on the ½ share of Lydia J. Alano in the subject property.
G.R. No. 157537 September 7, 2011

THE HEIRS OF PROTACIO GO, SR. and MARTA BAROLA, namely: LEONOR, SIMPLICIO, PROTACIO,
JR., ANTONIO, BEVERLY ANN LORRAINNE, TITA, CONSOLACION, LEONORA and ASUNCION, all
surnamed GO, represented by LEONORA B. GO, Petitioners,
vs.
ESTER L. SERVACIO and RITO B. GO, Respondents.

DECISION

BERSAMIN, J.:

The disposition by sale of a portion of the conjugal property by the surviving spouse without the prior liquidation
mandated by Article 130 of the Family Code is not necessarily void if said portion has not yet been allocated by
judicial or extrajudicial partition to another heir of the deceased spouse. At any rate, the requirement of prior
liquidation does not prejudice vested rights.

Antecedents

On February 22, 1976, Jesus B. Gaviola sold two parcels of land with a total area of 17,140 square meters
situated in Southern Leyte to Protacio B. Go, Jr. (Protacio, Jr.). Twenty three years later, or on March 29, 1999,
Protacio, Jr. executed an Affidavit of Renunciation and Waiver,1 whereby he affirmed under oath that it was his
father, Protacio Go, Sr. (Protacio, Sr.), not he, who had purchased the two parcels of land (the property).

On November 25, 1987, Marta Barola Go died. She was the wife of Protacio, Sr. and mother of the
petitioners.2 On December 28, 1999, Protacio, Sr. and his son Rito B. Go (joined by Rito’s wife Dina B. Go) sold
a portion of the property with an area of 5,560 square meters to Ester L. Servacio (Servacio) for
₱5,686,768.00.3 On March 2, 2001, the petitioners demanded the return of the property,4 but Servacio refused
to heed their demand. After barangay proceedings failed to resolve the dispute,5 they sued Servacio and Rito in
the Regional Trial Court in Maasin City, Southern Leyte (RTC) for the annulment of the sale of the property.

The petitioners averred that following Protacio, Jr.’s renunciation, the property became conjugal property; and
that the sale of the property to Servacio without the prior liquidation of the community property between
Protacio, Sr. and Marta was null and void.6

Servacio and Rito countered that Protacio, Sr. had exclusively owned the property because he had purchased
it with his own money.7

On October 3, 2002,8 the RTC declared that the property was the conjugal property of Protacio, Sr. and Marta,
not the exclusive property of Protacio, Sr., because there were three vendors in the sale to Servacio (namely:
Protacio, Sr., Rito, and Dina); that the participation of Rito and Dina as vendors had been by virtue of their
being heirs of the late Marta; that under Article 160 of the Civil Code, the law in effect when the property was
acquired, all property acquired by either spouse during the marriage was conjugal unless there was proof that
the property thus acquired pertained exclusively to the husband or to the wife; and that Protacio, Jr.’s
renunciation was grossly insufficient to rebut the legal presumption.9

Nonetheless, the RTC affirmed the validity of the sale of the property, holding that: "xxx As long as the portion
sold, alienated or encumbered will not be allotted to the other heirs in the final partition of the property, or to
state it plainly, as long as the portion sold does not encroach upon the legitimate (sic) of other heirs, it is
valid."10 Quoting Tolentino’s commentary on the matter as authority,11 the RTC opined:

In his comment on Article 175 of the New Civil Code regarding the dissolution of the conjugal partnership,
Senator Arturo Tolentino, says" [sic]
"Alienation by the survivor. — After the death of one of the spouses, in case it is necessary to sell any portion
of the community property in order to pay outstanding obligation of the partnership, such sale must be made in
the manner and with the formalities established by the Rules of Court for the sale of the property of the
deceased persons. Any sale, transfer, alienation or disposition of said property affected without said formalities
shall be null and void, except as regards the portion that belongs to the vendor as determined in the liquidation
and partition. Pending the liquidation, the disposition must be considered as limited only to the contingent share
or interest of the vendor in the particular property involved, but not to the corpus of the property.

This rule applies not only to sale but also to mortgages. The alienation, mortgage or disposal of the conjugal
property without the required formality, is not however, null ab initio, for the law recognizes their validity so long
as they do not exceed the portion which, after liquidation and partition, should pertain to the surviving spouse
who made the contract." [underlining supplied]

It seems clear from these comments of Senator Arturo Tolentino on the provisions of the New Civil Code and
the Family Code on the alienation by the surviving spouse of the community property that jurisprudence
remains the same - that the alienation made by the surviving spouse of a portion of the community property is
not wholly void ab initio despite Article 103 of the Family Code, and shall be valid to the extent of what will be
allotted, in the final partition, to the vendor. And rightly so, because why invalidate the sale by the surviving
spouse of a portion of the community property that will eventually be his/her share in the final partition?
Practically there is no reason for that view and it would be absurd.

Now here, in the instant case, the 5,560 square meter portion of the 17,140 square-meter conjugal lot is
certainly mush (sic) less than what vendors Protacio Go and his son Rito B. Go will eventually get as their
share in the final partition of the property. So the sale is still valid.

WHEREFORE, premises considered, complaint is hereby DISMISSED without pronouncement as to cost and
damages.

SO ORDERED.12

The RTC’s denial of their motion for reconsideration13 prompted the petitioners to appeal directly to the Court
on a pure question of law.

Issue

The petitioners claim that Article 130 of the Family Code is the applicable law; and that the sale by Protacio,
Sr., et al. to Servacio was void for being made without prior liquidation.

In contrast, although they have filed separate comments, Servacio and Rito both argue that Article 130 of the
Family Code was inapplicable; that the want of the liquidation prior to the sale did not render the sale invalid,
because the sale was valid to the extent of the portion that was finally allotted to the vendors as his share; and
that the sale did not also prejudice any rights of the petitioners as heirs, considering that what the sale
disposed of was within the aliquot portion of the property that the vendors were entitled to as heirs. 14

Ruling

The appeal lacks merit.

Article 130 of the Family Code reads:

Article 130. Upon the termination of the marriage by death, the conjugal partnership property shall be liquidated
in the same proceeding for the settlement of the estate of the deceased.

If no judicial settlement proceeding is instituted, the surviving spouse shall liquidate the conjugal partnership
property either judicially or extra-judicially within one year from the death of the deceased spouse. If upon the
lapse of the six month period no liquidation is made, any disposition or encumbrance involving the conjugal
partnership property of the terminated marriage shall be void.

Should the surviving spouse contract a subsequent marriage without compliance with the foregoing
requirements, a mandatory regime of complete separation of property shall govern the property relations of the
subsequent marriage.

Article 130 is to be read in consonance with Article 105 of the Family Code, viz:

Article 105. In case the future spouses agree in the marriage settlements that the regime of conjugal
partnership of gains shall govern their property relations during marriage, the provisions in this Chapter shall be
of supplementary application.

The provisions of this Chapter shall also apply to conjugal partnerships of gains already established between
spouses before the effectivity of this Code, without prejudice to vested rights already acquired in accordance
with the Civil Code or other laws, as provided in Article 256. (n) [emphasis supplied]

It is clear that conjugal partnership of gains established before and after the effectivity of the Family Code are
governed by the rules found in Chapter 4 (Conjugal Partnership of Gains) of Title IV (Property Relations
Between Husband And Wife) of the Family Code. Hence, any disposition of the conjugal property after the
dissolution of the conjugal partnership must be made only after the liquidation; otherwise, the disposition is
void.

Before applying such rules, however, the conjugal partnership of gains must be subsisting at the time of the
effectivity of the Family Code. There being no dispute that Protacio, Sr. and Marta were married prior to the
effectivity of the Family Code on August 3, 1988, their property relation was properly characterized as one of
conjugal partnership governed by the Civil Code. Upon Marta’s death in 1987, the conjugal partnership was
dissolved, pursuant to Article 175 (1) of the Civil Code,15 and an implied ordinary co-ownership ensued among
Protacio, Sr. and the other heirs of Marta with respect to her share in the assets of the conjugal partnership
pending a liquidation following its liquidation.16 The ensuing implied ordinary co-ownership was governed by
Article 493 of the Civil Code,17 to wit:

Article 493. Each co-owner shall have the full ownership of his part and of the fruits and benefits pertaining
thereto, and he may therefore alienate, assign or mortgage it, and even substitute another person in its
enjoyment, except when personal rights are involved. But the effect of the alienation or the mortgage, with
respect to the co-owners, shall be limited to the portion which may be allotted to him in the division upon the
termination of the co-ownership. (399)

Protacio, Sr., although becoming a co-owner with his children in respect of Marta’s share in the conjugal
partnership, could not yet assert or claim title to any specific portion of Marta’s share without an actual partition
of the property being first done either by agreement or by judicial decree. Until then, all that he had was an
ideal or abstract quota in Marta’s share.18 Nonetheless, a co-owner could sell his undivided share; hence,
Protacio, Sr. had the right to freely sell and dispose of his undivided interest, but not the interest of his co-
owners.19 Consequently, the sale by Protacio, Sr. and Rito as co-owners without the consent of the other co-
owners was not necessarily void, for the rights of the selling co-owners were thereby effectively transferred,
making the buyer (Servacio) a co-owner of Marta’s share.20 This result conforms to the well-established
principle that the binding force of a contract must be recognized as far as it is legally possible to do so (quando
res non valet ut ago, valeat quantum valere potest).21

Article 105 of the Family Code, supra, expressly provides that the applicability of the rules on dissolution of the
conjugal partnership is "without prejudice to vested rights already acquired in accordance with the Civil Code or
other laws." This provision gives another reason not to declare the sale as entirely void. Indeed, such a
declaration prejudices the rights of Servacio who had already acquired the shares of Protacio, Sr. and Rito in
the property subject of the sale.
In their separate comments,22 the respondents aver that each of the heirs had already received "a certain
allotted portion" at the time of the sale, and that Protacio, Sr. and Rito sold only the portions adjudicated to and
owned by them. However, they did not present any public document on the allocation among her heirs,
including themselves, of specific shares in Marta’s estate. Neither did they aver that the conjugal properties had
already been liquidated and partitioned. Accordingly, pending a partition among the heirs of Marta, the efficacy
of the sale, and whether the extent of the property sold adversely affected the interests of the petitioners might
not yet be properly decided with finality. The appropriate recourse to bring that about is to commence an action
for judicial partition, as instructed in Bailon-Casilao v. Court of Appeals,23 to wit:

From the foregoing, it may be deduced that since a co-owner is entitled to sell his undivided share, a sale of the
entire property by one

co-owner without the consent of the other co-owners is not null and void. However, only the rights of the co-
owner-seller are transferred, thereby making the buyer a co-owner of the property.

The proper action in cases like this is not for the nullification of the sale or for the recovery of possession of the
thing owned in common from the third person who substituted the co-owner or co-owners who alienated their
shares, but the DIVISION of the common property as if it continued to remain in the possession of the co-
owners who possessed and administered it [Mainit v. Bandoy, supra]. 1avv phi1

Thus, it is now settled that the appropriate recourse of co-owners in cases where their consent were not
secured in a sale of the entire property as well as in a sale merely of the undivided shares of some of the co-
owners is an action for PARTITION under Rule 69 of the Revised Rules of Court. xxx 24

In the meanwhile, Servacio would be a trustee for the benefit of the co-heirs of her vendors in respect of any
portion that might not be validly sold to her. The following observations of Justice Paras are explanatory of this
result, viz:

xxx [I]f it turns out that the property alienated or mortgaged really would pertain to the share of the surviving
spouse, then said transaction is valid. If it turns out that there really would be, after liquidation, no more
conjugal assets then the whole transaction is null and void. But if it turns out that half of the property thus
1âw phi1

alienated or mortgaged belongs to the husband as his share in the conjugal partnership, and half should go to
the estate of the wife, then that corresponding to the husband is valid, and that corresponding to the other is
not. Since all these can be determined only at the time the liquidation is over, it follows logically that a disposal
made by the surviving spouse is not void ab initio. Thus, it has been held that the sale of conjugal properties
cannot be made by the surviving spouse without the legal requirements. The sale is void as to the share of the
deceased spouse (except of course as to that portion of the husband’s share inherited by her as the surviving
spouse). The buyers of the property that could not be validly sold become trustees of said portion for the
benefit of the husband’s other heirs, the cestui que trust ent. Said heirs shall not be barred by prescription or by
laches (See Cuison, et al. v. Fernandez, et al.,L-11764, Jan.31, 1959.)25

WHEREFORE, we DENY the petition for review on certiorari; and AFFIRM the decision of the Regional Trial
Court.
G.R. No. 151898 March 14, 2012

RICARDO RIZAL, POTENCIANA RIZAL, SATURNINA RIZAL, ELENA RIZAL, and BENJAMIN
RIZAL,Petitioners,
vs.
LEONCIA NAREDO, ANASTACIO LIRIO, EDILBERTO CANTAVIEJA, GLORIA CANTAVIEJA, CELSO
CANTAVIEJA, and the HEIRS of MELANIE CANTAVIEJA, Respondents.

DECISION

REYES, J.:

Before this Court is a petition for review on certiorari under Rule 45 of the Decision 1 of the Court of Appeals
(CA) dated July 13, 2001 in CA-G.R. CV No. 26109, affirming the decision of the Regional Trial Court (RTC),
Branch 36, Calamba, Laguna which dismissed the Complaint,2 docketed as Civil Case No. 1153-87-C3 for
"partition, recovery of shares with damages" of Lot No. 252 on res judicata.

Factual Antecedents

Herein petitioners Ricardo, Potenciana, Elena, Saturnina and Benjamin, all surnamed Rizal, commenced Civil
Case No. 7836 against Matias Naredo (Matias), Valentin Naredo (Valentin) and Juana de Leon (Juana) before
the then Court of First Instance (CFI) of Laguna involving the accretion of two (2) hectares of land to Lot No.
454 of the Calamba Estate. In a decision rendered on May 22, 1947, the CFI ruled in favor of the petitioners.
The CFI awarded the ownership of the two-hectare accretion to the petitioners and ordered the defendants
therein to vacate the said land and to pay ₱500.00 a year from 1943 as reasonable rent for their occupancy
thereof. Both the CA and the Supreme Court upheld the decision.

To satisfy the money judgment in Civil Case No. 7836, the provincial sheriff of Laguna levied upon Lots Nos.
252 and 269 of the Calamba Estate, together with the house erected on Lot No. 252. This Lot No. 252, which is
the subject of the controversy, was registered under Transfer Certificate of Title (TCT) No. RT-488 (RT-3377
No. 12206) in the name of the "Legal Heirs of Gervacia Cantillano," of Parian, Calamba, Laguna. Several third-
party claims were filed, to wit: (a) by Leoncia Naredo (Leoncia) and Marcela Naredo (Marcela), who are also
heirs of Gervacia Cantillano over Lot No. 252; (b) by Pedro Cantavieja, husband of Marcela over Lot No. 269;
and (c) by Teodoro Armesto over the house of mixed materials standing on Lot No. 252. After the petitioners
posted the required bond, the provincial sheriff proceeded with the auction sale on April 7, 1951. The
petitioners were declared the highest bidders. A final deed of sale was issued to them on April 15, 1952.

On May 9, 1955, Marcela, Leoncia, Matias, Valentin, and Juana instituted Civil Case No. 9908 before the CFI
Branch 1, Laguna, questioning the validity of the execution sale of Lots Nos. 252 and 269 and the house of
mixed materials on Lot No. 252. They claimed that these properties were exempt from execution.

On December 8, 1955, the CFI declared valid the execution sale of Lots Nos. 252 and 269 of the Calamba
Estate in favor of the petitioners, with a qualification that the petitioners only acquired whatever rights, title or
interests Matias, Valentin and Juana had in Lot No. 252. The sale of the house of mixed materials in Lot No.
252 was set aside considering that a waiver was executed by the petitioners in favor of Juana. Although the
CFI ordered that the petitioners be placed in possession of Lots Nos. 252 and 269 and Matias and Valentin be
ejected therefrom, it did not evict Marcela and Leoncia from Lot No. 252 since they were not parties to Civil
Case No. 7836.4

After the aforesaid judgment in Civil Case No. 9908, the petitioners filed Civil Case No. 36-C against Marcela
and Leoncia for partition, accounting and recovery of possession of Lot No. 252. The parties then entered into
a Compromise Agreement whereby the parties acknowledged that they owned Lot No. 252 in common, with
3/5 thereof as the interest of the petitioners and the other 2/5 belonging to therein defendants Marcela and
Leoncia. Said Compromise Agreement was approved by the CFI Branch VI, Laguna, in an Order dated
December 1, 1971.5The pertinent portions of the agreement read as follows:
5. That the plaintiffs (herein petitioners) and the defendants (herein respondents) agree that said
parcel of land (Lot 252) embraced in Transfer Certificate of Title 12206, and registered in the names of
the Legal Heirs of Gervacia Cantillano, is now owned in common and in undivided shares of TWO-
FIFTHS (2/5) for the defendants and THREE-FIFTHS (3/5) for the plaintiffs;

6. That the plaintiffs and the defendants agree that the subject parcel of land be actually partitioned as
they have so caused the survey and partition of the same per the hereto attached copy of the pertinent
subdivision survey plan, marked as Annex "A" hereof and made integral part of this compromise
agreement;

7. That the plaintiffs and the defendants do hereby express their unqualified conformity to the said
partition and they hereby accept to their full and entire satisfaction their respective determined shares
in the subject parcel of land, and they agree to have their respective determined portions, Two-Fifths
(2/5) for defendants and Three-Fifths (3/5) for plaintiffs, to be covered by independent and separate
certificates of title in their respective names.

8. That the plaintiffs agree to shoulder all the expenses incurred in the partition and to pay all
expenses and fees which may be entailed in the issuance of the independent certificates of title in
favor of the respective parties by the proper Registry of Deeds;6

Ten years after or on August 11, 1981, Marcela and Leoncia, assisted by their husbands, instituted Civil Case
No. 299-83-C assailing the Compromise Agreement. They claimed that said agreement was a forgery and that
their lawyer was not duly authorized for the purpose. In an Order dated July 6, 1984, the trial court dismissed
the case without prejudice to the plaintiffs’ failure to prosecute.

Thereafter, on September 26, 1984, Marcela and Leoncia instituted Civil Case No. 792-84-C, for enforcement
of judgment, partition and segregation of shares with damages over Lot No. 252. On July 6, 1985, the trial court
dismissed the complaint on the ground of prescription. No appeal was taken therefrom.

On September 21, 1987, the petitioners filed a Complaint before the RTC for the immediate segregation,
partition and recovery of shares and ownership of Lot No. 252, with damages. This was docketed as Civil Case
No. 1153-87-C. However, on April 3, 1990, on the basis of the pleadings and exhibits, the court a quo
dismissed the complaint because of res judicata. The trial court stated thus:

"A perusal of this instant case and Civil Case No. 792-84-C, (Exh. ‘1’) will readily show that between these
causes of actions, there are (a) identity of parties; (b) identity of subject matter; and (c) identity of cause of
action. As admitted by the parties, the judgment in Civil Case No. 792-84-C is now final and executory. While
there may appear a difference in the forms of action, the same is irrelevant for purposes of determining res
judicata. It is a firmly established rule that a different remedy sought or a diverse form of action does not
prevent the estoppel of the former adjudication.

x x x."7

Aggrieved, the petitioners appealed to the CA, docketed as CA-G.R. CV No. 26109. Unfortunately, the original
records of the case were misplaced. After earnest efforts were made for the reconstitution of the records of the
case, the parties agreed to have the case submitted for decision based on the documents submitted. 8

In the now assailed decision,9 the CA dismissed the appeal. The CA found that the appellants’ brief neither
contained the required page references to the records, as provided in Section 13 of Rule 44 of the Rules of
Court; nor was it specified, both in the prayer and in the body of the complaint, the specific amounts of the
petitioners’ claim for actual, moral, exemplary and compensatory damages, as enunciated in Manchester
Development Corporation v. Court of Appeals.10

As to the substantive issues raised in the complaint, the CA ruled that the action for partition has been barred
by res judicata. It also held that the petitioners no longer had any cause of action for partition because the co-
ownership of the parties over Lot No. 252 had ceased to exist by the Order of the CFI Branch VI, Laguna on
December 1, 1971.

Issues

In the case at bar, the petitioners submit the following issues for this Court’s consideration, to wit:

A.

THE CA ERRED IN DISMISSING THE APPEAL ON THE GROUND THAT THE PETITIONERS'
APPEAL BRIEF FAILED TO MAKE PAGE REFERENCES TO THE RECORD.

B.

THE CA ERRED IN APPLYING THE RULING IN THE MANCHESTER CASE REGARDING DOCKET
FEES.

C.

THE CA ERRED IN DISMISSING THE APPEAL ON THE GROUND OF PRESCRIPTION AND RES
JUDICATA.

D.

THE RTC ERRED IN DISMISSING THE ENTIRE CASE.11

Ruling and Discussions

We find no merit in the petition.

Failure to observe the requirements under Section 13(a), Rule 44 of the 1997 Rules of Court and to pay the
correct docket fees is fatal to the appeal.

The petitioners argue that the CA erred in dismissing their appeal for their failure to indicate the page
references to the records of the case pursuant to Section 13(a), Rule 4412 of the Rules of Court. They invoke
Section 6, Rule 1 of the 1997 Rules of Civil Procedure which states that "technical rules shall be liberally
construed in order to promote a just, speedy and inexpensive disposition of every action and proceeding." They
cite the case of Pacific Life Assurance Corporation v. Sison,13 where it was held that an appeal should not be
dismissed on mere technicality.

It is settled that technical rules of procedure are mere tools designed to facilitate the attainment of justice. Their
strict and rigid application should be relaxed when they hinder rather than promote substantial justice. Cases
should as much as possible be resolved on the merits, and not on mere technicalities. The failure of the
petitioners' appeal brief to contain page references to the records is a formal defect which may be considered
as minor, if not negligible.14

However, while this Court may be lenient in some instances on formal defects of pleadings filed with the court,
it could not close its eyes when a litigant continuously ignores technical rules, to the point of wanton disregard
of the rationale behind those rules. In fact, this Court has consistently affirmed the importance of complying
with the requirements in Section 13(a), Rule 4415 of the Rules of Court in many of its decisions, particularly in
Mendoza v. United Coconut Planters Bank, Inc.,16 where the Court explicitly stated that:

Rule 44 and 50 of the 1997 Rules of Civil Procedure are designed for the proper and prompt disposition of
cases before the Court of Appeals Rules of Procedure exist for a noble purpose, and to disregard such rules in
the guise of liberal construction would be to defeat such purpose. The Court of Appeals noted in its Resolution
denying petitioners’ motion for reconsideration that despite ample opportunity, petitioners never attempted to
file an amended appellants’ brief correcting the deficiencies of their brief, but obstinately clung to their
argument that their Appellants’ Brief substantially complied with the rules. Such obstinacy is incongruous with
their plea for liberality in construing the rules on appeal.

De Liano v. Court of Appeals held:

"Some may argue that adherence to these formal requirements serves but a meaningless purpose, that these
may be ignored with little risk in the smug certainty that liberality in the application of procedural rules can
always be relied upon to remedy the infirmities. This misses the point. We are not martinets; in appropriate
instances, we are prepared to listen to reason, and to give relief as the circumstances may warrant. However,
when the error relates to something so elementary as to be inexcusable, our discretion becomes nothing more
than an exercise in frustration. It comes as an unpleasant shock to us that the contents of an appellant’s brief
should still be raised as an issue now. There is nothing arcane or novel about the provisions of Section 13,
Rule 44. The rule governing the contents of appellants’ briefs has existed since the old Rules of Court, which
took effect on July 1, 1940, as well as the Revised Rules of Court, which took effect on January 1, 1964, until
they were superseded by the present 1997 Rules of Civil Procedure. The provisions were substantially
preserved, with few revisions."17

Moreover, the petitioners also failed to pay the correct docket fees; in which case, jurisdiction did not vest in the
trial court. In Siapno v. Manalo,18 this Court has made it abundantly clear that any complaint, petition, answer
and other similar pleading, which does not specify both in its body and prayer the amount of damages being
claimed, should not be accepted or admitted, or should be expunged from the records, as may be the case.19

The petitioners alleged in their complaint in Civil Case No. 1153-87-C20 that they suffered actual loss from the
time they had been deprived of their share of 3/5 on Lot No. 252 by the respondents, as well as moral and
exemplary damages, attorney's fees and litigation expenses. However, the only claims they specified in their
prayer were for the attorney's fees in the amount of ₱30,000.00 and ₱500.00 for every court appearance of the
counsel.

In Siapno,21 the complaint alleged in its body the aggregate sum of ₱4,500,000 in moral and exemplary
damages and attorney's fees, but the prayer portion did not mention these claims, nor did it even pray for the
payment of damages. This Court held that such a complaint should be dismissed outright; or if already
admitted, should be expunged from the records. The Court explained that the rule – requiring the amount of
damages claimed to be specified not only in the body of the pleading but also in its prayer portion – was
intended to put an end to the then prevailing practice of lawyers where the damages prayed for were recited
only in the body of the complaint, but not in the prayer, in order to evade payment of the correct filing fees. As
held by the Court in Manchester:22

To put a stop to this irregularity, henceforth all complaints, petitions, answers and other similar pleadings
should specify the amount of damages being prayed for not only in the body of the pleading but also in the
prayer, and said damages shall be considered in the assessment of the filing fees in any case. Any pleading
that fails to comply with this requirement shall not be accepted nor admitted, or shall otherwise be expunged
from the record.23

In Sun Insurance Office Ltd. v. Judge Asuncion,24 the Court laid down the following rules as regards the
payment of filing fees:

1. It is not simply the filing of the complaint or appropriate initiatory pleading, but the payment of the
prescribed docket fee that vests a trial court with jurisdiction over the subject matter or nature of the
action. Where the filing of the initiatory pleading is not accompanied by payment of the docket fee, the
court may allow payment of the fee within a reasonable time but in no case beyond the applicable
prescriptive or reglementary period.
2. The same rule applies to permissive counterclaims, third-party claims and similar pleadings, which
shall not be considered filed until and unless the filing fee prescribed therefor is paid. The court may
also allow payment of said fee within a reasonable time but also in no case beyond its applicable
prescriptive or reglementary period.

3. Where the trial court acquires jurisdiction over a claim by the filing of the appropriate pleading and
payment of the prescribed filing fee but, subsequently, the judgment awards a claim not specified in
the pleading, or if specified the same has been left for determination by the court, the additional filing
fee therefor shall constitute a lien on the judgment. It shall be the responsibility of the Clerk of Court or
his duly authorized deputy to enforce said lien and assess and collect the additional fee. 25

It cannot be gainsaid from the above guidelines that, with the exception of pauper litigants, 26 without the
payment of the correct docket or filing fees within the reglementary period, jurisdiction over the subject-matter
or nature of the action will not vest in the trial court. In fact, a pauper litigant may still have to pay the docket
fees later, by way of a lien on the monetary or property judgment that may accrue to him. Clearly, the flexibility
or liberality of the rules sought by the petitioners cannot apply in the instant case.

Action is dismissible for res judicata and lack of cause of action.

The petitioners vehemently deny that the partition of Lot No. 252 has already been settled in Civil Case No. 36-
C. They insist that the mere determination of the proportionate shares of the parties, as well as their respective
portions of the aforesaid lot in the Compromise Agreement is not enough. They allege that Lot No. 252 is still
covered by the old title, TCT No. 12206, in the name of the heirs of Gervacia Cantillano. The finality of the
decision in Civil Case No. 36-C did not cause Lot No. 252 to divide itself in accordance with the subdivision
plan. They assert that there must be an actual and exclusive possession of their respective portions in the plan
and titles issued to each of them accordingly.27

The petitioners’ contentions are untenable.

Article 484 of the New Civil Code provides that there is co-ownership whenever the ownership of an undivided
thing or right belongs to different persons. Thus, on the one hand, a co-owner of an undivided parcel of land is
an owner of the whole, and over the whole he exercises the right of dominion, but he is at the same time the
owner of a portion which is truly abstract. On the other hand, there is no co-ownership when the different
portions owned by different people are already concretely determined and separately identifiable, even if not
yet technically described.28

Pursuant to Article 494 of the Civil Code, no co-owner is obliged to remain in the co-ownership, and his proper
remedy is an action for partition under Rule 69 of the Rules of Court, which he may bring at anytime in so far as
his share is concerned. Article 1079 of the Civil Code defines partition as the separation, division and
assignment of a thing held in common among those to whom it may belong. It has been held that the fact that
the agreement of partition lacks the technical description of the parties' respective portions or that the subject
property was then still embraced by the same certificate of title could not legally prevent a partition, where the
different portions allotted to each were determined and became separately identifiable.29

The partition of Lot No. 252 was the result of the approved Compromise Agreement in Civil Case No. 36-C,
which was immediately final and executory. Absent any showing that said Compromise Agreement was vitiated
by fraud, mistake or duress, the court cannot set aside a judgment based on compromise. 30 It is axiomatic that a
compromise agreement once approved by the court settles the rights of the parties and has the force of res
judicata. It cannot be disturbed except on the ground of vice of consent or forgery.31

Of equal significance is the fact that the compromise judgment in Civil Case No. 36-C settled as well the
question of which specific portions of Lot No. 252 accrued to the parties separately as their proportionate
shares therein. Through their subdivision survey plan, marked as Annex "A"32 of the Compromise Agreement
and made an integral part thereof, the parties segregated and separately assigned to themselves distinct
portions of Lot No. 252. The partition was immediately executory,33 having been accomplished and completed
on December 1, 1971 when judgment was rendered approving the same. The CA was correct when it stated
that no co-ownership exist when the different portions owned by different people are already concretely
determined and separately identifiable, even if not yet technically described.34

It bears to note that the parties even acknowledged in Paragraph 7 of the Compromise Agreement that they
had accepted their "respective determined shares in the subject parcel of land, and they agree to have their
respective determined portions, Two-Fifths (2/5) for defendants and Three-Fifths (3/5) for plaintiffs, to be
covered by independent and separate certificates of title in their respective names."35

The petitioners slept on their rights under the partition agreement.

To recall, the petitioners obtained part ownership of Lot No. 252 as the highest bidders at the execution sale of
Lots Nos. 252 and 269 in Civil Case No. 7836, whereas respondents Marcela and Leoncia as heirs of Gervacia
Cantillano retained their 2/5 interest in Lot No. 252 since they were not impleaded in the said case. As buyers
of land, the petitioners had the right to pursue their share therein all the way to the issuance of their separate
title and recovery of possession of their portion, beginning with the filing of Civil Case No. 36-C.

Concerning the registration with the Registry of Deeds of a judgment of partition of land, Section 81 of
Presidential Decree (P.D.) No. 1529 provides that after the entry of the final judgment of partition, a copy of
such final judgment shall be filed and registered. If the land is set off to the owner in severalty, each owner shall
be entitled to have his certificate entered showing the share set off to him in severalty, and to receive an
owner's duplicate thereof.36

Accordingly, Paragraph 8 of the Compromise Agreement provided that the petitioners shall "shoulder all the
expenses incurred in the partition and to pay all expenses and fees which may be incurred in the issuance of
the independent certificates of title in favor of the respective parties by the proper Registry of
Deeds."37 Unfortunately, the records do not disclose that the petitioners neither filed and registered with the
Register of Deeds a certified copy of the final judgment of partition in Civil Case No. 36-C, nor did they perform
or cause to be performed all further acts requisite for the cancellation of TCT No. 12206 and the issuance of
the parties' separate titles over their assigned portions in Lot No. 252. The only entry in TCT No. 12206,38 prior
to the recording on June 13, 1979 of the issuance to the petitioners of a second duplicate copy of TCT No.
12206, is the annotation in April 1952 of the execution sale of Lot No. 252 to the petitioners.

Section 6, Rule 39 of the Rules of Court provides:

Sec. 6. Execution by motion or by independent action. – A final and executory judgment or order may be
executed on motion within five (5) years from the date of its entry. After the lapse of such time, and before it is
barred by the statute of limitations, a judgment may be enforced by action. The revived judgment may also be
enforced by motion within five (5) years from the date of its entry and thereafter by action before it is barred by
the statute of limitations.

A final and executory judgment may be executed by the prevailing party as a matter of right by mere motion
within five (5) years from the entry of judgment, failing which the judgment is reduced to a mere right of action
which must be enforced by the institution of a complaint in a regular court within ten (10) years from finality of
the judgment.39 In the instant case, there is no showing that after the judgment in Civil Case No. 36-C, the
petitioners filed a motion to execute the same during the first five (5) years after its finality, or within the
succeeding five (5) years, by a civil action to revive the judgment, before it would have been barred by the
statute of limitations.40 An action for revival of judgment is governed by Articles 1144(3) and 1152 of the Civil
Code, and Section 6, Rule 39 of the Rules of Court. Articles 1144(3) and 1152 of the Code state:

Art. 1144. The following actions must be brought within ten years from the time the right of action accrues:

xxxx

(3) Upon a judgment


Art. 1152. The period for prescription of actions to demand the fulfillment of obligations declared by a judgment
commences from the time the judgment became final.

When the petitioners filed Civil Case No. 1153-87-C on September 21, 1987, it was not purportedly to revive
the judgment in Civil Case No. 36-C. It was apparently an action for "Partition, Recovery of Shares with
Damages," but nonetheless citing as basis of the Compromise Agreement in Civil Case No. 36-C. The
petitioners wanted to accomplish through an entirely new action what was already adjudicated in Civil Case No.
36-C, rendered 17 years earlier, but which they inexplicably failed to enforce. The petitioners do not allege that
they tried to execute the compromise judgment in Civil Case No. 36-C either by motion or by action to revive
judgment within the prescriptive period. Absent any proof that the respondents resorted to dilatory schemes
and maneuvers to prevent the execution of the Compromise Agreement,41 and contrary to the petitioners’
gratuitous assertion in paragraph VIII of their complaint in Civil Case No. 1153-87-C, we fail to see how the
mere filing by the respondents of Civil Case No. 299-83-C on August 11, 1981 could have in any way
prevented or impeded the petitioners from executing the judgment in Civil Case No. 36-C.

We thus sustain the respondents' affirmative defenses of res judicata and lack of cause of action, and uphold
the appellate and trial courts' rejection of the petitioners' ostensible attempt to revive the already stale judgment
in Civil Case No. 36-C through an entirely new action for partition. The Court agrees with the CA when it
explained:

a. The judgment that effected res judicata is not so much the dismissal of the case due to prescription
in Civil Case No. 792-84-C. What more appropriately leads to res judicata to this case is the final
Compromise Judgment in Civil Case No. 36-C. All the elements of res judicata are present, a final
decision on the merits, between the same parties, on the same subject matter and cause of action. x x
x.

b. The present complaint states no cause of action. There is no doubt that appellants’ prayer for
partition is anchored on their supposed co-ownership of Lot No. 252 plus the added fact that it is still
covered by Transfer Certificate of Title No. 12206. However, appellants must have lost track of the fact
that at the time the present action was commenced, partition was no longer an available remedy in
their favor simply because their pretended co-ownership had already ceased to exist. Their 3/5 shares
had already been segregated and determined in the subdivision plan mentioned in the Compromise
Judgment and have, in fact, accepted their share to their satisfaction. In De la Cruz vs. Cruz, 32 SCRA
307 [1970], the Supreme Court, through Justice J.B.L. Reyes, said that co-ownership no longer exists
over the whole parcel of land where the portions owned by the parties are already determined and
identifiable. That said respective portions are not technically described, or that said portions are still
embraced in one and the same certificate of title, does not make said portions less determinable, or
identifiable, or distinguishable, one from the other, nor that dominion over its portions rest exclusively
in their respective owners.42

Nonetheless, it must be made clear that nothing in this decision shall be understood to mean that the
petitioners have lost their title or interest in the subject property. The final ("definite") deed of sale executed by
the sheriff in favor of the petitioners pursuant to the execution sale in Civil Case No. 7836, which was duly
registered in TCT No. 12206 on April 15, 1952, constituted an effective conveyance to the petitioners of the
property sold therein and entitled them to possession thereof,43 although in the subsequent decision in 1955 in
Civil Case No. 9908, the respondents’ 2/5 interest in the property was recognized, thereby amending the extent
of the petitioners’ title. The said judgment has not been registered, and neither was the compromise judgment
of partition in Civil Case No. 36-C dated December 1, 1971, which established the parties’ respective specific
portions in Lot No. 252. Thus, as a prerequisite to the issuance of a new title in the name of the petitioners over
their 3/5 allocated portion, we believe that Section 8144 of P.D. No. 1529 does not bar the belated registration of
the compromise judgment in Civil Case No. 36-C.

WHEREFORE, premises considered, the petition is DENIED. The Decision of the Court of Appeals dated July
13, 2001 in CA-G.R. CV No. 26109 is AFFIRMED.
G.R. No. 76351 October 29, 1993

VIRGILIO B. AGUILAR, petitioner,


vs.
COURT OF APPEALS and SENEN B. AGUILAR, respondents.

Jose F. Manacop for petitioner.

Siruello, Muyco & Associates Law Office for private respondent.

BELLOSILLO, J.:

This is a petition for review on certiorari seeking to reverse and set aside the Decision of the Court of Appeals
in CA-GR CV No. 03933 declaring null and void the orders of 23 and 26 April, 1979, the judgment by default of
26 July 1979, and the order of 22 October 1979 of the then Court of First Instance of Rizal, Pasay City, Branch
30, and directing the trial court to set the case for pre-trial conference.

Petitioner Virgilio and respondent Senen are brothers; Virgilio is the youngest of seven (7) children of the late
Maximiano Aguilar, while Senen is the fifth. On 28 October 1969, the two brothers purchased a house and lot in
Parañaque where their father could spend and enjoy his remaining years in a peaceful neighborhood. Initially,
the brothers agreed that Virgilio's share in the co-ownership was two-thirds while that of Senen was one-third.
By virtue of a written memorandum dated 23 February 1970, Virgilio and Senen agreed that henceforth their
interests in the house and lot should be equal, with Senen assuming the remaining mortgage obligation of the
original owners with the Social Security System (SSS) in exchange for his possession and enjoyment of the
house together with their father.

Since Virgilio was then disqualified from obtaining a loan from SSS, the brothers agreed that the deed of sale
would be executed and the title registered in the meantime in the name of Senen. It was further agreed that
Senen would take care of their father and his needs since Virgilio and his family were staying in Cebu.

After Maximiano Aguilar died in 1974, petitioner demanded from private respondent that the latter vacate the
house and that the property be sold and proceeds thereof divided among them.

Because of the refusal of respondent to give in to petitioner's demands, the latter filed on 12 January 1979 an
action to compel the sale of the house and lot so that the they could divide the proceeds between them.

In his complaint, petitioner prayed that the proceeds of the sale, be divided on the basis of two-thirds (2/3) in
his favor and one-third (1/3) to respondent. Petitioner also prayed for monthly rentals for the use of the house
by respondent after their father died.

In his answer with counterclaim, respondent alleged that he had no objection to the sale as long as the best
selling price could be obtained; that if the sale would be effected, the proceeds thereof should be divided
equally; and, that being a co-owner, he was entitled to the use and enjoyment of the property.

Upon issues being joined, the case was set for pre-trial on 26 April 1979 with the lawyers of both parties
notified of the pre-trial, and served with the pre-trial order, with private respondent executing a special power of
attorney to his lawyer to appear at the pre-trial and enter into any amicable settlement in his behalf.1

On 20 April 1979, Atty. Manuel S. Tonogbanua, counsel for respondent, filed a motion to cancel pre-trial on the
ground that he would be accompanying his wife to Dumaguete City where she would be a principal sponsor in
a wedding.
On 23 April 1979, finding the reasons of counsel to be without merit, the trial court denied the motion and
directed that the pre-trial should continue as scheduled.

When the case was called for pre-trial as scheduled on 26 April 1979, plaintiff and his counsel appeared.
Defendant did not appear; neither his counsel in whose favor he executed a special power of attorney to
represent him at the pre-trial. Consequently, the trial court, on motion of plaintiff, declared defendant as in
default and ordered reception of plaintiff's evidence ex parte.

On 7 May 1979, defendant through counsel filed an omnibus motion to reconsider the order of default and to
defer reception of evidence. The trial court denied the motion and plaintiff presented his evidence.

On 26 July 1979, rendering judgment by default against defendant, the trial court found him and plaintiff to be
co-owners of the house and lot, in equal shares on the basis of their written agreement. However, it ruled that
plaintiff has been deprived of his participation in the property by defendant's continued enjoyment of the house
and lot, free of rent, despite demands for rentals and continued maneuvers of defendants, to delay partition.
The trial court also upheld the right of plaintiff as co-owner to demand partition. Since plaintiff could not agree
to the amount offered by defendant for the former's share, the trial court held that this property should be sold
to a third person and the proceeds divided equally between the parties.

The trial court likewise ordered defendant to vacate the property and pay plaintiff P1,200.00 as rentals 2 from
January 1975 up to the date of decision plus interest from the time the action was filed.

On 17 September 1979, defendant filed an omnibus motion for new trial but on 22 October 1979 the trial court
denied the motion.

Defendant sought relief from the Court of Appeals praying that the following orders and decision of the trial
court be set aside: (a) the order of 23 April 1970 denying defendants motion for postponement of the pre-trial
set on 26 April 1979; (b) the order of 26 April 1979 declaring him in default and authorizing plaintiff to present
his evidence ex-parte; (e) the default judgment of 26 July 1979; and, (d) the order dated 22 October 1979
denying his omnibus motion for new trial.

On 16 October 1986, the Court of Appeals set aside the order of the trial court of 26 April 1979 as well as the
assailed judgment rendered by default., The appellate court found the explanation of counsel for defendant in
his motion to cancel pre-trial as satisfactory and devoid of a manifest intention to delay the disposition of the
case. It also ruled that the trial court should have granted the motion for postponement filed by counsel for
defendant who should not have been declared as in default for the absence of his counsel.

Petitioner now comes to us alleging that the Court of Appeals erred (1) in not holding that the motion of
defendant through counsel to cancel the pre-trial was dilatory in character and (2) in remanding the case to the
trial court for pre-trial and trial.

The issues to be resolved are whether the trial court correctly declared respondent as in default for his failure to
appear at the pre-trial and in allowing petitioner to present his evidence ex-parte, and whether the trial court
correctly rendered the default judgment against respondent.

We find merit in the petition.

As regards the first issue, the law is clear that the appearance of parties at the pre-trial is mandatory.3 A party
who fails to appear at a pre-trial conference may be non-suited or considered as in default.4 In the case at bar,
where private respondent and counsel failed to appear at the scheduled pre-trial, the trial, court has authority to
declare respondent in default.5

Although respondent's counsel filed a motion to postpone pre-trial hearing, the grant or denial thereof is within
the sound discretion of the trial court, which should take into account two factors in the grant or denial of
motions for postponement, namely: (a) the reason for the postponement and (b) the merits of the case of
movant.6

In the instant case, the trial court found the reason stated in the motion of counsel for respondent to cancel the
pre-trial to be without merit. Counsel's explanation that he had to go to by boat as early as 25 March 1979 to
fetch his wife and accompany her to a wedding in Dumaguete City on 27 April 1979 where she was one of the
principal sponsors, cannot be accepted. We find it insufficient to justify postponement of the pre-trial, and the
Court of Appeals did not act wisely in overruling the denial. We sustain the trial court and rule that it did not
abuse its discretion in denying the postponement for lack of merit. Certainly, to warrant a postponement of a
mandatory process as pre-trial would require much more than mere attendance in a social function. It is time
indeed we emphasize that there should be much more than mere perfunctory treatment of the pre-trial
procedure. Its observance must be taken seriously if it is to attain its objective, i.e., the speedy and inexpensive
disposition of cases.

Moreover, the trial court denied the motion for postponement three (3) days before the scheduled pre-trial. If
indeed, counsel for respondent could not attend the pre-trial on the scheduled date, respondent at least should
have personally appeared in order not to be declared as in default. But, since nobody appeared for him, the
order of the trial court declaring him as in default and directing the presentation of petitioner's evidence ex
parte was proper.7

With regard to the merits of the judgment of the trial court by default, which respondent appellate court did not
touch upon in resolving the appeal, the Court holds that on the basis of the pleadings of the parties and the
evidence presented ex parte, petitioner and respondents are co-owners of subject house and lot in equal
shares; either one of them may demand the sale of the house and lot at any time and the other cannot object to
such demand; thereafter the proceeds of the sale shall be divided equally according to their respective
interests.

Private respondent and his family refuse to pay monthly rentals to petitioner from the time their father died in
1975 and to vacate the house so that it can be sold to third persons. Petitioner alleges that respondent's
continued stay in the property hinders its disposal to the prejudice of petitioner. On the part of petitioner, he
claims that he should be paid two-thirds (2/3) of a monthly rental of P2,400.00 or the sum of P1,600.00.

In resolving the dispute, the trial court ordered respondent to vacate the property so that it could be sold to third
persons and the proceeds divided between them equally, and for respondent to pay petitioner one-half (1/2) of
P2,400.00 or the sum of P1,200.00 as monthly rental, conformably with their stipulated sharing reflected in their
written agreement.

We uphold the trial court in ruling in favor of petitioner, except as to the effectivity of the payment of monthly
rentals by respondent as co-owner which we here declare to commence only after the trial court ordered
respondent to vacate in accordance with its order of 26 July 1979.

Article 494 of the Civil Code provides that no co-owner shall be obliged to remain in the co-ownership, and that
each co-owner may demand at any time partition of the thing owned in common insofar as his share is
concerned. Corollary to this rule, Art. 498 of the Code states that whenever the thing is essentially, indivisible
and the co-owners cannot agree that it be, allotted to one of them who shall indemnify the others, it shall be
sold and its proceeds accordingly distributed. This is resorted to (1) when the right to partition the property is
invoked by any of the co-owners but because of the nature of the property it cannot be subdivided or its
subdivision would prejudice the interests of the co-owners, and (b) the co-owners are not in agreement as to
who among them shall be allotted or assigned the entire property upon proper reimbursement of the co-
owners. In one case,8 this Court upheld the order of the trial court directing the holding of a public sale of the
properties owned in common pursuant to Art. 498 of the Civil Code.

However, being a co-owner respondent has the right to use the house and lot without paying any compensation
to petitioner, as he may use the property owned in common long as it is in accordance with the purpose for
which it is intended and in a manner not injurious to the interest of the other co-owners.9 Each co-owner of
property held pro indiviso exercises his rights over the whole property and may use and enjoy the same with no
other limitation than that he shall not injure the interests of his co-owners, the reason being that until a division
is made, the respective share of each cannot be determined and every co-owner exercises, together with his
co-participants joint ownership over the pro indiviso property, in addition to his use and enjoyment of the
same. 10

Since petitioner has decided to enforce his right in court to end the co-ownership of the house and lot and
respondent has not refuted the allegation that he has been preventing the sale of the property by his continued
occupancy of the premises, justice and equity demand that respondent and his family vacate the property so
that the sale can be effected immediately. In fairness to petitioner, respondent should pay a rental of P1,200.00
per month, with legal interest; from the time the trial court ordered him to vacate, for the use and enjoyment of
the other half of the property appertaining to petitioner.

When petitioner filed an action to compel the sale of the property and the trial court granted the petition and
ordered the ejectment of respondent, the co-ownership was deemed terminated and the right to enjoy the
possession jointly also ceased. Thereafter, the continued stay of respondent and his family in the house
prejudiced the interest of petitioner as the property should have been sold and the proceeds divided equally
between them. To this extent and from then on, respondent should be held liable for monthly rentals until he
and his family vacate.

WHEREFORE, the petition is GRANTED. The assailed Decision of the Court of Appeals dated 16 October
1986 is REVERSED and SET ASIDE. The decision of the trial court in Civil Case No. 69.12-P dated 16 July
1979 is REINSTATED, with the modification that respondent Senen B. Aguilar is ordered to vacate the
premises in question within ninety (90) days from receipt of this and to pay petitioner Virgilio B. Aguilar a
monthly rental of P1,200.00 with interest at the legal rate from the time he received the decision of the trial
court directing him to vacate until he effectively leaves the premises.

The trial court is further directed to take immediate steps to implement this decision conformably with Art. 498
of the Civil Code and the Rules of Court. This decision is final and executory.
G.R. No. 56550 October 1, 1990

MARINA Z. REYES, AUGUSTO M. ZABALLERO and SOCORRO Z. FRANCISCO, petitioners,


vs.
THE HONORABLE ALFREDO B. CONCEPCION, Presiding Judge, CFI of Cavite, Tagaytay, Br. IV,
SOCORRO MARQUEZ VDA. DE ZABALLERO, EUGENIA Z. LUNA, LEONARDO M. ZABALLERO, and
ELENA FRONDA ZABALLERO, respondents.

Law Firm of Raymundo A. Armovit for petitioners.

Leonardo M. Zaballero for private respondents.

CORTÉS, J.:

On March 13, 1980, petitioners filed with the CFI a complaint for injunction and damages, docketed as Civil Case No. TG-572, seeking to
enjoin private respondents Socorro Marquez Vda. De Zaballero, Eugenia Z. Luna and Leonardo M. Zaballero from selling to a third party
their pro-indiviso shares as co-owners in eight parcels of registered land (covered by TCT Nos. A-1316 to A-1322) located in the province of
Cavite, with an aggregate area of about 96 hectares. Petitioner claimed that under Article 1620 of the new Civil Code, they, as co-owners,
had a preferential right to purchase these shares from private respondents for a reasonable price.

On March 17, 1980, respondent trial judge denied the ex parte application for a writ of preliminary injunction, on
the ground that petitioners' registered notice of lis pendens was ample protection of their rights.

On April 24, 1980, private respondents received the summons and copies of the complaint. Private
respondents then filed their answer with counterclaim, praying for the partition of the subject properties. Private
respondent Elena Fronda Zaballero filed a motion for intervention dated April 29, 1980, adopting therein her co-
respondents answer with counterclaim.

At the pre-trial hearing, the parties agreed on the following stipulation of facts:

xxx xxx xxx

1. That the plaintiffs, the defendants and the intervenor are the pro-indiviso co-owners of the
properties cited and described in the complaint;

2. That six and nine tenth (6-9/10) hectares of the land covered by TCT No. T-1319;
approximately twelve (12) hectares of that covered by TCT No. T-1320; and the entire parcel
of covered by TCT No. T-1321, are subject of expropriation proceedings instituted by the
National Housing Authority (NHA) now pending before this Court in Civil Case Nos. TG-392,
TG-396 and TG-417;

3. That based on the evidence presented by the herein parties in the aforecited expropriation
cases, the current valuation of the land and the improvements thereon is at P95,132.00 per
hectare;

4. That on 16 April 1980, the plaintiffs received a written notice from the defendants and the
intervenor that the VOLCANO SECURITIES TRADERS AND AGRI-BUSINESS
CORPORATION had offered to buy the latter's share in the properties listed in the complaint
subject to the following terms:

1. The selling price shall be net at TWELVE & 50/100 (P12.50) PESOS per
square meter, or a total price of NINE MILLION (P9,000,000.00) PESOS for
a total area of SEVENTY TWO (72) HECTARES ONLY;
2. A downpayment equivalent to THIRTY (30%) PERCENT of the selling
price, or a minimum downpayment of TWO MILLION SEVEN HUNDRED
THOUSAND (P2,700,000.00) PESOS;

3. The balance of the purchase price to be payable within THREE (3)


YEARS from the date of downpayment in THREE (3) EQUAL, ANNUAL
PAYMENTS with interest at the legal rate prevailing at the time of payment;

4. The balance shall be covered by a BANK GUARANTEE of payments and


shall not be governed by Art. 1250 of the Civil Code.

(Cf. Annexes 1, 2 and 3, Answer)

5. That in said letters (Annexes 1, 2 and 3, Answer), the plaintiffs were requested:

a) To exercise their pre-emptive right to purchase defendants' and


intervenor's shares under the above-quoted terms; or

b) To agree to a physical partition of the properties; or

c) To sell their shares, jointly with the defendants and the intervenor, to the
VOLCANO SECURITIES TRADERS AND AGRI-BUSINESS
CORPORATION at the price and under the terms aforequoted.

6. That the VOLCANO SECURITIES TRADERS AND AGRI-BUSINESS CORPORATION is


ready, willing and able to purchase not only the aliquot shares of the defendants and the
intervenor, but also that of the plaintiffs, in and to all the properties subject of this case, for
and in consideration of the net amount of TWELVE and 50/100 (P12.50) PESOS per square
meter and under the afore-quoted terms;

xxx xxx xxx

[Annex "C" of the Petition, pp. 1-2, Rollo, pp. 43-44.]

The parties laid down their respective positions, as follows:

PLAINTIFFS

1. That the subject properties are incapable of physical partition;

2. That the price of P12.50 per square meter is grossly excessive;

3. That they are willing to exercise their pre-emptive right for an amount of not more that
P95,132.00 per hectare, which is the fair and reasonable value of said properties;

4. That the statutory period for exercising their pre-emptive right was suspended upon the
filing of the complaint;

DEFENDANTS AND INTERVENOR

1. That the reasonable price of the subject properties is P12.50 per square meter;
2. That plaintiffs' right of legal pre-emption had lapsed upon their failure to exercise the same
within the period prescribed in Art. 1623 of the Civil Code of the Philippines;

3. That, assuming the soundness of plaintiffs' claim that the price of P12.50 per square meter
is grossly excessive, it would be to the best interest of the plaintiffs to sell their shares to the
VOLCANO SECURITIES TRADERS AND AGRI-BUSINESS CORPORATION, whose
sincerity, capacity and good faith is beyond question, as the same was admitted by the parties
herein;

4. That the subject properties consisting approximately 95 hectares may be physically


partitioned without difficulty in the manner suggested by them to plaintiffs, and as graphically
represented in the subdivision plan, which will be furnished in due course to plaintiffs' counsel.

[Annex "C" of the Petition, pp. 2-3; Rollo, pp. 44-45.]

Based on the foregoing, respondent trial judge rendered a pre-trial order dated July 9, 1980 granting petitioners
a period of ten days from receipt of the subdivision plan to be prepared by a competent geodetic engineer
within which to express their approval or disapproval of the said plan, or to submit within the same period, if
they so desire, an alternative subdivision plan.

On July 16, 1980, counsel for private respondents sent to the counsel for petitioners a letter enclosed with a
subdivision plan.

On August 4, 1980, petitioners filed their comment to the pre-trial order, contending that the question of
reasonable value of the subject properties remains a contentious issue of fact ascertainable only after a full
trial. Petitioners likewise insisted on their pre- emptive right to purchase private respondents' shares in the co-
ownership after due determination of the reasonable price thereof.

Thereafter, counsel for private respondents sent the counsel for petitioners another subdivision plan prepared
by a geodetic engineer. Still, no definite communication was sent by petitioners signifying their approval or
disapproval to the subdivision plans.

In order to settle once and for all the controversy between the parties, private respondents filed a motion dated
December 16, 1980 requesting that petitioners be required to formally specify which of the two options under
Article 498 of the New Civil Code they wished to avail of: that petitioners' shares in the subject properties be
sold to private respondents, at the rate of P12.50 per square meter; or that the subject properties be sold to a
third party, VOLCANO LAKEVIEW RESORTS, INC. (claimed to have been erroneously referred to in the pre-
trial as VOLCANO SECURITIES TRADERS AND AGRI-BUSINESS CORPORATION) and its proceeds thereof
distributed among the parties.

Finding merit in the private respondents' request, and for the purpose of determining the applicability of Article
498 of the New Civil Code, respondent trial judge issued an order dated February 4, 1981 which directed the
parties to signify whether or not they agree to the scheme of allotting the subject properties to one of the co-
owners, at the rate of P12.50 per square meter, or whether or not they know of a third party who is able and
willing to buy the subject properties at terms and conditions more favorable than that offered by VOLCANO
LAKEVIEW RESORTS, INC. The order contained a series of questions addressed to all the parties, who were
thereupon required to submit their answers thereto.

Private respondents filed a "Constancia" expressing that they were willing to allot their shares in the subject
properties to Socorro Marquez Vda. de Zaballero, at the rate of P12.50 per square meter, and that they did not
know of any other party who was willing and able to purchase the subject properties under more favorable
conditions than that offered by VOLCANO LAKEVIEW RESORTS, INC.

However, instead of submitting their answers to the queries posed by respondent trial judge, petitioners filed a
motion for clarification as to the true identity of the third party allegedly willing to purchase the subject
properties.
On February 26, 1981, respondent trial judge rejected petitioners' motion on the ground that it was irrelevant.

Thereupon, on February 27, 1981, petitioners filed a pleading captioned "Compliance and Motion", (1)
reiterating the relevance of ascertaining the true identity of the third party buyer, VOLCANO SECURITIES
TRADERS AND AGRI-BUSINESS CORPORATION or VOLCANO LAKEVIEW RESORTS, INC., (2)
expressing their view that there is actually no bona fide and financially able third party willing to purchase the
subject properties at the rate of P12.50 per square meter, and, (3) once again insisting on their pre-emptive
right to purchase the shares of private respondents in the co-ownership at a "reasonable price", which is less
than that computed excessively by the latter at the rate of P12.50 per square meter. Petitioners therein prayed
that further proceedings be conducted in order to settle the factual issue regarding the reasonable value of the
subject properties.

On March 16, 1981, respondent trial judge issued an order denying petitioners' motion. The judge ruled that
petitioners did not possess a pre-emptive right to purchase private respondents' shares in the co-ownership.
Thus, finding that the subject properties were essentially indivisible, respondent trial judge ordered the holding
of a public sale of the subject properties pursuant to Article 498 of the New Civil Code. A notice of sale was
issued setting the date of public bidding for the subject properties on April 13, 1981.

Petitioners then filed a motion for reconsideration from the above order. Respondent trial judge reset the
hearing on petitioners' motion for reconsideration to April 6, 1981, and moved the scheduled public sale to April
14, 1981.

Without awaiting resolution of their motion for reconsideration, petitioners filed the present petition for certiorari,
alleging that the respondent trial judge acted without jurisdiction, or in grave abuse of its discretion amounting
to lack of jurisdiction, in issuing his order dated March 16, 1981 which denied petitioners' claim of a pre-emptive
right to purchase private respondents' pro-indiviso shares and which, peremptorily ordered the public sale of
the subject properties. On April 8, 1981, this Court issued a temporary restraining order enjoining the sale of
the subject properties at public auction.

With the comment and reply, the Court considered the issues joined and the case submitted for decision.

The Court finds no merit in the present petition.

The attack on the validity of respondent trial judge's order dated March 16, 1981 is ultimately premised on
petitioners' claim that they had a pre-emptive right to purchase the pro-indiviso shares of their co-owners,
private respondents herein, at a "reasonable price". It is this same claim which forms the basis of their
complaint for injunction and damages filed against private respondents in the court a quo.

This claim is patently without basis. In this jurisdiction, the legal provisions on co-ownership do not grant to any
of the owners of a property held in common a pre-emptive right to purchase the pro-indiviso shares of his co-
owners. Petitioners' reliance on Article 1620 of the New Civil Code is misplaced. Article 1620 provides:

A co-owner of a thing may exercise the right of redemption in case the shares of all the co-
owners or of any of them, are sold to a third person. If the price of the alienation is grossly
excessive, the redemptioner shall pay only a reasonable one.

Should two or more co-owners desire to exercise the right of redemption, they may only do so
in proportion to the share they may respectively have in the thing owned in common
[Emphasis supplied].

Article 1620 contemplates of a situation where a co-owner has alienated his pro-indiviso shares to a stranger.
By the very nature of the right of "legal redemption", a co-owner's light to redeem is invoked only after the
shares of the other co-owners are sold to a third party or stranger to the co-ownership [See Estrada v. Reyes,
33 Phil. 31 (1915)]. But in the case at bar, at the time petitioners filed their complaint for injunction and
damages against private respondents, no sale of the latter's pro-indiviso shares to a third party had yet been
made. Thus, Article 1620 of the New Civil Code finds no application to the case at bar.
There is likewise no merit to petitioners' contention that private respondents had acknowledged the pre-emptive
right of petitioners to purchase their shares at a "reasonable price". Although it appears that private
respondents had agreed to sell their pro-indiviso shares to petitioners, the offer was made at a fixed rate of
P12.50 per square meter [See Pre-trial Order dated July 9, 1980, Annex "C" of the Petition; Rollo, pp. 43-45]. It
cannot be said that private respondents had agreed, without qualification, to sell their shares to petitioners.
Hence, petitioners cannot insist on a right to purchase the shares at a price lower than the selling price of
private respondents.

Neither do petitioners have the legal right to enjoin private respondents from alienating their pro-indiviso shares
to a third party. The rights of a co-owner of a property are clearly specified in Article 493 of the New Civil Code,
thus:

Art. 493. Each co-owner shall have the full ownership of his part and of the fruits and benefits
pertaining thereto, and he may therefore alienate, assign or mortgage it, and even substitute
another person in its enjoyment, except when personal rights are involved. But the effect of
the alienation of the mortgage, with respect to the co-owners shall be limited to the portion
which may be allotted to him in the division upon the termination of the co-ownership.

The law does not prohibit a co-owner from selling, alienating or mortgaging his ideal share in the property held
in common. The law merely provides that the alienation or mortgage shall be limited only to the portion of the
property which may be allotted to him upon termination of the co-ownership [See Mercado v. Liwanag, G.R.
No. L-14429, June 30, 1962, 5 SCRA 472; PNB v. The Honorable Court of Appeals, G.R. No. L-34404, June
25, 1980, 98 SCRA 207; Go Ong v. The Honorable Court of Appeals, G.R. No. 75884, September 24, 1987,
154 SCRA 270,] and, as earlier discussed, that the remaining co-owners have the right to redeem, within a
specified period, the shares which may have been sold to the third party. [Articles 1620 and 1623 of the New
Civil Code.]

Considering the foregoing, the Court holds that respondent trial judge committed no grave abuse of discretion
when he denied petitioners' claim of a pre-emptive right to purchase private respondents' pro-indiviso shares.

Moreover, there is no legal infirmity tainting respondent trial judge's order for the holding of a public sale of the
subject properties pursuant to the provisions of Article 498 of the New Civil Code. After a careful examination of
the proceedings before respondent trial judge, the Court finds that respondent trial judge's order was issued in
accordance with the laws pertaining to the legal or juridical dissolution of co-ownerships.

It must be noted that private respondents, in their answer with counterclaim prayed for, inter alia, the partition of
the subject properties in the event that the petitioners refused to purchase their pro-indiviso shares at the rate
of P12.50 per square meter. Unlike petitioners' claim of a pre-emptive right to purchase the other co-
owners' pro-indiviso shares, private respondents' counterclaim for the partition of the subject properties is
recognized by law, specifically Article 494 of the New Civil Code which lays down the general rule that no co-
owner is obliged to remain in the co-ownership. Article 494 reads as follows:

No co-owner shall be obliged to remain in the co-ownership. Each co-owner may demand at
any time partition of the thing owned in common, insofar as his share is concerned.

Nevertheless, an agreement to keep the thing undivided for a certain period of time, not
exceeding ten years, shall be valid. This term may be extended by a new agreement.

A donor or testator may prohibit partition for a period which shall not exceed twenty years.

Neither shall there be partition when it is prohibited by law.

No prescription shall run in favor of a co-owner or co-heir against his co-owners or co-heirs so
long as he expressly or impliedly recognizes the co-ownership.
None of the legal exceptions under Article 494 applies to the case at bar. Private respondents' counterclaim for
the partition of the subject properties was therefore entirely proper. However, during the pre-trial proceedings,
petitioners adopted the position that the subject properties were incapable of physical partition. Initially, private
respondents disputed this position. But after petitioners inexplicably refused to abide by the pretrial order
issued by respondent trial judge, and stubbornly insisted on exercising an alleged pre-emptive right to purchase
private respondents' shares at a "reasonable price", private respondents relented and adopted petitioner's
position that the partition of the subject properties was not economically feasible, and, consequently, invoked
the provisions of Article 498 of the New Civil Code [Private respondents' "Motion To Allot Properties To
Defendants Or To Sell the Same Pursuant To Article 498 Of The Civil Code", Annex "D" of the Petition; Rollo,
pp. 46-49].

Inasmuch as the parties were in agreement as regards the fact that the subject properties should not be
partitioned, and private respondents continued to manifest their desire to terminate the co-ownership
arrangement between petitioners and themselves, respondent trial judge acted within his jurisdiction when he
issued his order dated February 4, 1981 requiring the parties to answer certain questions for the purpose of
determining whether or not the legal conditions for the applicability of Article 498 of the New Civil Code were
present in the case.

Art. 498 provides that:

Whenever the thing is essentially indivisible and the co-owners cannot agree that it be alloted
to one of them who shall indemnify the others, it shall be sold and its proceeds distributed.

The sale of the property held in common referred to in the above article is resorted to when (1) the right to
partition the property among the co-owners is invoked by any of them but because of the nature of the property,
it cannot be subdivided or its subdivision [See Article 495 of the New Civil Code] would prejudice the interests
of the co-owners (See Section 5 of Rule 69 of the Revised Rules of Court) and (2) the co-owners are not in
agreement as to who among them shall be allotted or assigned the entire property upon reimbursement of the
shares of the other co-owners.

Petitioners herein did not have justifiable grounds to ignore the queries posed by respondent trial judge and to
insist that hearings be conducted in order to ascertain the reasonable price at which they could purchase
private respondents' pro-indiviso shares [Petitioners' "Compliance and Motion" dated February 27, 1981, Annex
"H" of the Petition; Rollo, pp. 57-60].

Since at this point in the case it became reasonably evident to respondent trial judge that the parties could not
agree on who among them would be allotted the subject properties, the Court finds that respondent trial judge
committed no grave abuse of discretion in ordering the holding of a public sale for the subject properties (with
the opening bid pegged at P12.50 per square meter), and the distribution of the proceeds thereof amongst the
co-owners, as provided under Article 498 of the New Civil Code.

Contrary to petitioners' contention, there was no need for further hearings in the case because it is apparent
from the various allegations and admissions of the parties made during the pre-trial proceedings, and in their
respective pleadings, that the legal requisites for the application of Article 498 of the New Civil Code were
present in the case. No factual issues remained to be litigated upon.

WHEREFORE, the present petition is DISMISSED for lack of merit. The temporary restraining order issued by
the Court is hereby LIFTED.

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