G.R. No.

74833

January 21, 1991

THOMAS C. CHEESMAN, petitioner,

vs.
INTERMEDIATE APPELLATE COURT and ESTELITA PADILLA, respondents.

2. That the transaction regarding the transfer of their property took place during the
existence of their marriage as the couple were married on December 4, 1970 and the
questioned property was acquired sometime on June 4,1974.

The action resulted in a judgment dated June 24, 1982, 10 declaring void ab initio the sale executed
by Criselda Cheesman in favor of Estelita M. Padilla, and ordering the delivery of the property to
This appeal concerns the attempt by an American citizen (petitioner Thomas Cheesman) to annul Thomas Cheesman as administrator of the conjugal partnership property, and the payment to him of
11
for lack of consent on his part the sale by his Filipino wife (Criselda) of a residential lot and P5,000.00 as attorney's fees and expenses of litigation.
building to Estelita Padilla, also a Filipino.
The judgment was however set aside as regards Estelita Padilla on a petition for relief filed by the
Thomas Cheesman and Criselda P. Cheesman were married on December 4, 1970 but have been latter, grounded on "fraud, mistake and/or excusable negligence" which had seriously impaired her
right to present her case adequately. 12 "After the petition for relief from judgment was given due
separated since February 15,1981. 1
course," according to petitioner, "a new judge presided over the case." 13
On June 4, 1974, a "Deed of Sale and Transfer of Possessory Rights" was executed by Armando
Altares conveying a parcel of unregistered land and the house thereon (at No. 7 Neptune Street,
Gordon Heights, Olongapo City) in favor of "Criselda P. Cheesman, of legal age, Filipino citizen,
married to Thomas Cheesman, and residing at Lot No. 1, Blk. 8, Filtration Road, Sta. Rita, Olongapo
City . . ." 2 Thomas Cheesman, although aware of the deed, did not object to the transfer being
made only to his wife.3
Thereafterand again with the knowledge of Thomas Cheesman and also without any protest by
himtax declarations for the property purchased were issued in the name only of Criselda
Cheesman and Criselda assumed exclusive management and administration of said property,
leasing it to tenants. 4
On July 1, 1981, Criselda Cheesman sold the property to Estelita M. Padilla, without the knowledge
or consent of Thomas Cheesman. 5 The deed described Criselda as being" . . . of legal age, married
to an American citizen,. . ."6
Thirty days later, or on July 31, 1981, Thomas Cheesman brought suit in the Court of First Instance
at Olongapo City against his wife, Criselda, and Estelita Padilla, praying for the annulment of the
sale on the ground that the transaction had been executed without his knowledge and consent. 7 An
answer was filed in the names of both defendants, alleging that (1) the property sold was
paraphernal, having been purchased by Criselda with funds exclusively belonging to her ("her own
separate money"); (2) Thomas Cheesman, being an American, was disqualified to have any interest
or right of ownership in the land; and (3) Estelita Padilla was a buyer in good faith. 8

Estelita Padilla filed a supplemental pleading on December 20, 1982 as her own answer to the
complaint, and a motion for summary judgment on May 17, 1983. Although there was initial
opposition by Thomas Cheesman to the motion, the parties ultimately agreed on the rendition by the
court of a summary judgment after entering into a stipulation of facts, at the hearing of the motion on
June 21, 1983, the stipulation being of the following tenor: 14
(1) that the property in question was bought during the existence of the marriage between
the plaintiff and the defendant Criselda P. Cheesman;
(2) that the property bought during the marriage was registered in the name of Criselda
Cheesman and that the Deed of Sale and Transfer of Possessory Rights executed by the
former owner-vendor Armando Altares in favor of Criselda Cheesman made no mention of
the plaintiff;
(3) that the property, subject of the proceedings, was sold by defendant Criselda Cheesman
in favor of the other defendant Estelita M. Padilla, without the written consent of the plaintiff.
Obviously upon the theory that no genuine issue existed any longer and there was hence no need
of a trial, the parties having in fact submitted, as also stipulated, their respective memoranda each
praying for a favorable verdict, the Trial Court 15 rendered a "Summary Judgment" dated August 3,
1982 declaring "the sale executed by . . . Criselda Cheesman in favor of . . . Estelita Padilla to be
valid," dismissing Thomas Cheesman's complaint and ordering him "to immediately turn over the
possession of the house and lot subject of . . . (the) case to . . . Estelita Padilla . . ." 16

During the pre-trial conference, the parties agreed upon certain facts which were subsequently set
out in a pre-trial Order dated October 22, 1981, 9 as follows:
The Trial Court found that
1. Both parties recognize the existence of the Deed of Sale over the residential house
located at No. 7 Granada St., Gordon Heights, Olongapo City, which was acquired from
Armando Altares on June 4, 1974 and sold by defendant Criselda Cheesman to Estelita
Padilla on July 12, 1981; and

1) the evidence on record satisfactorily overcame the disputable presumption in Article 160
of the Civil Codethat all property of the marriage belongs to the conjugal partnership
"unless it be proved that it pertains exclusively to the husband or to the wife"and that the
immovable in question was in truth Criselda's paraphernal property;

2) that moreover, said legal presumption in Article 160 could not apply "inasmuch as the 6) to fail to declare that Thomas Cheesman's citizenship is not a bar to his action to recover the lot
husband-plaintiff is an American citizen and therefore disqualified under the Constitution to and house for the conjugal partnership.22
acquire and own real properties; and
Such conclusions as that (1) fraud, mistake or excusable negligence existed in the premises
3) that the exercise by Criselda of exclusive acts of dominion with the knowledge of her justifying relief to Estelita Padilla under Rule 38 of the Rules of Court, or (2) that Criselda Cheesman
husband "had led . . . Estelita Padilla to believe that the properties were the exclusive had used money she had brought into her marriage to Thomas Cheesman to purchase the lot and
properties of Criselda Cheesman and on the faith of such a belief she bought the properties house in question, or (3) that Estelita Padilla believed in good faith that Criselda Cheesman was the
from her and for value," and therefore, Thomas Cheesman was, under Article 1473 of the exclusive owner of the property that she (Estelita) intended to and did in fact buyderived from the
Civil Code, estopped to impugn the transfer to Estelita Padilla.
evidence adduced by the parties, the facts set out in the pleadings or otherwise appearing on record
are conclusions or findings of fact. As distinguished from a question of lawwhich exists "when
Thomas Cheesman appealed to the Intermediate Appellate Court. There he assailed the Trial Court the doubt or difference arises as to what the law is on a certain state of facts" "there is a question
23
acts (1) of granting Estelita Padilla's petition for relief, and its resolution of matters not subject of of fact when the doubt or difference arises as to the truth or the falsehood of alleged facts;" or when
the
"query
necessarily
invites
calibration
of
the
whole
evidence
considering
mainly
the
credibility
of
said petition; (2) of declaring valid the sale to Estelita Padilla despite the lack of consent thereto by
witnesses,
existence
and
relevancy
of
specific
surrounding
circumstances,
their
relation;
to
each
him, and the presumption of the conjugal character of the property in question pursuant to Article
24
160 of the Civil Code; (3) of disregarding the judgment of June 24, 1982 which, not having been set other and to the whole and the probabilities of the situation."
aside as against Criselda Cheesman, continued to be binding on her; and (4) of making findings of
fact not supported by evidence. All of these contentions were found to be without merit by the Now, it is axiomatic that only questions of law, distinctly set forth, may be raised in a petition for the
Appellate Tribunal which, on January 7, 1986, promulgated a decision (erroneously denominated, review oncertiorari of a decision of the Court of Appeals presented to this Court. 25 As everyone
"Report")17 affirming the "Summary Judgment complained of," "having found no reversible error" knows or ought to know, the appellate jurisdiction of this Court is limited to reviewing errors of law,
therein.
accepting as conclusive the factual findings of the lower court upon its own assessment of the
evidence. 26 The creation of the Court of Appeals was precisely intended to take away from the
Once more, Thomas Cheesman availed of the remedy of appeal, this time to this Court. Here, he Supreme Court the work of examining the evidence, and confine its task to the determination of
questions which do not call for the reading and study of transcripts containing the testimony of
argues that it was reversible error for the Intermediate Appellate Court
witnesses.27 The rule of conclusiveness of the factual findings or conclusions of the Court of Appeals
28
1) to find that the presumption that the property in question is conjugal in accordance with Article is, to be sure, subject to certain exceptions, none of which however obtains in the case at bar.
160 had been satisfactorily overcome by Estelita Padilla;

18

2) to rule that Estelita Padilla was a purchaser of said property in good faith, it appearing:
a) that the deed by which the property was conveyed to Criselda Cheesman
described her as "married to Thomas C. Cheesman," as well as the deed by which
the property was later conveyed to Estelita Padilla by Criselda Cheesman also
described her as "married to an American citizen," and both said descriptions had
thus "placed Estelita on knowledge of the conjugal nature of the property;" and

It is noteworthy that both the Trial Court and the Intermediate Appellate Court reached the same
conclusions on the three (3) factual matters above set forth, after assessment of the evidence and
determination of the probative value thereof. Both Courts found that the facts on record adequately
proved fraud, mistake or excusable negligence by which Estelita Padilla's rights had been
substantially impaired; that the funds used by Criselda Cheesman was money she had earned and
saved prior to her marriage to Thomas Cheesman, and that Estelita Padilla did believe in good faith
that Criselda Cheesman was the sole owner of the property in question. Consequently, these
determinations of fact will not be here disturbed, this Court having been cited to no reason for doing
so.

b) that furthermore, Estelita had admitted to stating in the deed by which she These considerations dispose of the first three (3) points that petitioner Cheesman seeks to make in
acquired the property a price much lower than that actually paid "in order to avoid his appeal.1wphi1They also make unnecessary an extended discussion of the other issues raised
payment of more obligation to the government;" 19
by him. As to them, it should suffice to restate certain fundamental propositions.
3) to decline to declare that the evidence did not warrant the grant of Estelita Padilla's petition for An order of a Court of First Instance (now Regional Trial Court) granting a petition for relief under
relief on the ground of "fraud, mistake and/or excusable negligence;" 20
Rule 38 is interlocutory and is not appealable. Hence, the failure of the party who opposed the
petition to appeal from said order, or his participation in the proceedings subsequently had, cannot
4) to hold that Thomas Cheesman had waived his objection to Estelita's petition for relief by failing be construed as a waiver of his objection to the petition for relief so as to preclude his raising the
to appeal from the order granting the same;
same question on appeal from the judgment on the merits of the main case. Such a party need not
repeat his objections to the petition for relief, or perform any act thereafter (e.g., take formal
5) to accord to Estelita Padilla a relief other than that she had specifically prayed for in her petition exception) in order to preserve his right to question the same eventually, on appeal, it being
sufficient for this purpose that he has made of record "the action which he desires the court to take
for relief, ie., "the restoration of the purchase price which Estelita allegedly paid to Criselda;" 21 and
or his objection to the action of the court and his grounds therefor." 29

Again, the prayer in a petition for relief from judgment under Rule 38 is not necessarily the same
prayer in the petitioner's complaint, answer or other basic pleading. This should be obvious. Equally
obvious is that once a petition for relief is granted and the judgment subject thereof set aside, and
further proceedings are thereafter had, the Court in its judgment on the merits may properly grant
the relief sought in the petitioner's basic pleadings, although different from that stated in his petition
for relief.

VICENTE GODINEZ, ET AL., plaintiffs-appellants,

vs.
FONG PAK LUEN ET AL., defendants, TRINIDAD S. NAVATA, defendant-appellee.

The plaintiffs filed this case to recover a parcel of land sold by their father, now deceased, to Fong
Pak Luen, an alien, on the ground that the sale was null and void ab initio since it violates applicable
Finally, the fundamental law prohibits the sale to aliens of residential land. Section 14, Article XIV of provisions of the Constitution and the Civil Code.
the 1973 Constitution ordains that, "Save in cases of hereditary succession, no private land shall be
transferred or conveyed except to individuals, corporations, or associations qualified to acquire or The order of the Court of First Instance of Sulu dismissing the complaint was appealed to the Court
hold lands of the public domain." 30 Petitioner Thomas Cheesman was, of course, charged with of Appeals but the latter court certified the appeal to us since only pure questions of law were raised
knowledge of this prohibition. Thus, assuming that it was his intention that the lot in question be by the appellants.
purchased by him and his wife, he acquired no right whatever over the property by virtue of that
purchase; and in attempting to acquire a right or interest in land, vicariously and clandestinely, he
knowingly violated the Constitution; the sale as to him was null and void. 31 In any event, he had and The facts of the case were summarized by the Court of Appeals as follows:
has no capacity or personality to question the subsequent sale of the same property by his wife on
the theory that in so doing he is merely exercising the prerogative of a husband in respect of
On September 30, 1966, the plaintiffs filed a complaint in the Court of First Instance of Sulu
conjugal property. To sustain such a theory would permit indirect controversion of the constitutional
alleging among others that they are the heirs of Jose Godinez who was married to Martina
prohibition. If the property were to be declared conjugal, this would accord to the alien husband a
Alvarez Godinez sometime in 1910; that during the marriage of their parents the said parents
not insubstantial interest and right over land, as he would then have a decisive vote as to its transfer
acquired a parcel of land lot No. 94 of Jolo townsite with an area of 3,665 square meters as
or disposition. This is a right that the Constitution does not permit him to have.
evidenced by Original Certificate of Title No. 179 (D -155) in the name of Jose Godinez; that
their mother died sometime in 1938 leaving the plaintiffs as their sole surviving heirs; that on
As already observed, the finding that his wife had used her own money to purchase the property
November 27, 1941, without the knowledge of the plaintiffs, the said Jose Godinez, for
cannot, and will not, at this stage of the proceedings be reviewed and overturned. But even if it were
valuable consideration, sold the aforesaid parcel of land to the defendant Fong Pak Luen, a
a fact that said wife had used conjugal funds to make the acquisition, the considerations just set out
militate, on high constitutional grounds, against his recovering and holding the property so acquired
Chinese citizen, which transaction is contrary to law and in violation of the Civil Code because
or any part thereof. And whether in such an event, he may recover from his wife any share of the
the latter being an alien who is inhibited by law to purchase real property; that Transfer
money used for the purchase or charge her with unauthorized disposition or expenditure of conjugal
Certificate Title No. 884 was then issued by the Register of Deeds to the said defendant, which
funds is not now inquired into; that would be, in the premises, a purely academic exercise. An
is null and void ab initio since the transaction constituted a non-existent contract; that on
equally decisive consideration is that Estelita Padilla is a purchaser in good faith, both the Trial
January 11, 1963, said defendant Fong Pak Luen executed a power of attorney in favor of his
Court and the Appellate Court having found that Cheesman's own conduct had led her to believe the
co-defendant Kwan Pun Ming, also an alien, who conveyed and sold the above described
property to be exclusive property of the latter's wife, freely disposable by her without his consent or
parcel of land to co-defendant Trinidad S. Navata, who is aware of and with full knowledge that
intervention. An innocent buyer for value, she is entitled to the protection of the law in her purchase,
particularly as against Cheesman, who would assert rights to the property denied him by both letter
Fong Pak Luen is a Chinese citizen as well as Kwan Pun Ming, who under the law are
and spirit of the Constitution itself.
prohibited and disqualified to acquire real property in this jurisdiction; that defendant Fong Pak
Luen has not acquired any title or interest in said parcel of land as the purported contract of
WHEREFORE, the appealed decision is AFFIRMED, with costs against petitioner.
sale executed by Jose Godinez alone was contrary to law and considered non- existent, so
much so that the alleged attorney-in-fact, defendant Kwan Pun Ming had not conveyed any title
SO ORDERED.
or interest over said property and defendant Navata had not acquired anything from said
grantor and as a consequence Transfer Certificate of Title No. 1322, which was issued by the
Cruz, Gancayco, Grio-Aquino and Medialdea, JJ., concur.
Register of Deeds in favor of the latter is null and void ab initio,- that since one-half of the said
property is conjugal property inherited by the plaintiffs from their mother, Jose Godinez could
-not have legally conveyed the entire property; that notwithstanding repeated demands on said
defendant to surrender to plaintiffs the said property she refused and still refuses to do so to
GR. No. L-36731 January 27, 1983
the great damage and prejudice of the plaintiffs; and that they were constrained to engage the
services of counsel in the sum of P2,000.00.1wph1.t The plaintiffs thus pray that they be
adjudged as the owners of the parcel of land in question and that Transfer Certificate of Title

RT-90 (T-884) issued in the name of defendant Fong Pak Luen be declared null and void ab
initio; and that the power of attorney issued in the name of Kwan Pun Ming, as well as Transfer
Certificate of Title No. 'L322 issued in the name of defendant Navata be likewise declared null
and void, with costs against defendants.
On August 18, 1966, the defendant Register of Deeds filed an answer claiming that he was not
yet the register of deeds then; that it was only the ministerial duty of his office to issue the title
in favor of the defendant Navata once he was determined the registerability of the documents
presented to his office.
On October 20, 1966, the defendant Navata filed her answer with the affirmative defenses and
counterclaim alleging among others that the complaint does not state a cause of action since it
appears from the allegation that the property is registered in the name of Jose Godinez so that
as his sole property he may dispose of the same; that the cause of action has been barred by
the statute of limitations as the alleged document of sale executed by Jose Godinez on
November 27, 1941, conveyed the property to defendant Fong Pak Luen as a result of which a
title was issued to said defendant; that under Article 1144 (1) of the Civil Code, an action based
upon a written contract must be brought within 10 years from the time the right of action
accrues; that the right of action accrued on November 27, 1941 but the complaint was filed
only on September 30, 1966, beyond the 10 year period provided for by law; that the torrens
title in the name of defendant Navata is indefeasible who acquired the property from defendant
Fong Pak Luen who had been in possession of the property since 1941 and thereafter
defendant Navata had possessed the same for the last 25 years including the possession of
Fong Pak Luen; that the complaint is intended to harass the defendant as a civic leader and
respectable member of the community as a result of which she suffered moral damages of
P100,000.00, P2,500.00 for attorney's fees and P500.00 expenses of litigation, hence, said
defendant prays that the complaint be dismissed and that her counterclaim be granted, with
costs against the plaintiffs. On November 24, 1967, the plaintiffs filed an answer to the
affirmative defenses and counter-claim. As the defendants Fong Pak Luen and Kwan Pun Ming
are residing outside the Philippines, the trial court upon motion issued an order of April 17,
1967, for the service of summons on said defendants by publication. No answer has been filed
by said defendants.
On December 2, 196 7, the court issued an order as follows:
Both parties having agreed to the suggestion of the Court that they submit their supplemental
pleadings to support both motion and opposition and after submittal of the same the said
motion to dismiss which is an affirmative defense alleged in the complaint is deemed
submitted. Failure of both parties or either party to submit their supplemental pleadings on or
about December 9, the Court will resolve the case.
On November 29, 1968, the trial court issued an order missing the complaint without
pronouncement as to costs. (Record on Appeal, pp. 31- 37). A motion for reconsideration of

this order was filed by the plaintiffs on December 12, 196F, which was denied by the trial court
in an order of July 11, 1969, (Rec. on Appeal, pp. 38, 43, 45, 47). The plaintiffs now interpose
this appeal with the following assignments of errors:
I. The trial court erred in dismissing plaintiffs-appellants' complaint on the ground of
prescription of action, applying Art. 1144 (1) New Civil Code on the basis of defendant Trinidad
S. Navata's affirmative defense of prescription in her answer treated as a motion to dismiss.
II. The trial court erred in denying plaintiffs-appellants' motion for reconsideration of the order of
dismissal.
III. The trial court erred in not ordering this case to be tried on the merits."
The appellants contend that the lower court erred in dismissing the complaint on the ground that
their cause of action has prescribed. While the issue raised appears to be only the applicability of
the law governing prescription, the real question before us is whether or not the heirs of a person
who sold a parcel of land to an alien in violation of a constitutional prohibition may recover the
property if it had, in the meantime, been conveyed to a Filipino citizen qualified to own and possess
it.
The question is not a novel one. Judicial precedents indicate fairly clearly how the question should
be resolved.
There can be no dispute that the sale in 1941 by Jose Godinez of his residential lot acquired from
the Bureau of Lands as part of the Jolo townsite to Fong Pak Luen, a Chinese citizen residing in
Hongkong, was violative of Section 5, Article XIII of the 1935 Constitution which provided:
Sec. 5. Save in cases of hereditary succession, no private agricultural land will be
transferred or assigned except to individuals, corporations, or associations qualified
to acquire or hold lands of the public domain in the Philippines.
The meaning of the above provision was fully discussed in Krivenko v. Register of Deeds of
Manila (79 Phil. 461) which also detailed the evolution of the provision in the public land laws, Act
No. 2874 and Commonwealth Act No. 141. The Krivenko ruling that "under the Constitution aliens
may not acquire private or agricultural lands, including residential lands" is a declaration of an
imperative constitutional policy. Consequently, prescription may never be invoked to defend that
which the Constitution prohibits. However, we see no necessity from the facts of this case to pass
upon the nature of the contract of sale executed by Jose Godinez and Fong Pak Luen whether
void ab initio, illegal per se or merely pro-exhibited.** It is enough to stress that insofar as the
vendee is concerned, prescription is unavailing. But neither can the vendor or his heirs rely on an
argument based on imprescriptibility because the land sold in 1941 is now in the hands of a Filipino
citizen against whom the constitutional prescription was never intended to apply. The lower court
erred in treating the case as one involving simply the application of the statute of limitations.

From the fact that prescription may not be used to defend a contract which the Constitution
prohibits, it does not necessarily follow that the appellants may be allowed to recover the property
sold to an alien. As earlier mentioned, Fong Pak Luen, the disqualified alien vendee later sold the
same property to Trinidad S. Navata, a Filipino citizen qualified to acquire real property.
In Vasquez v. Li Seng Giap and Li Seng Giap & Sons (96 Phil. 447), where the alien vendee later
sold the property to a Filipino corporation, this Court, in affirming a judgment dismissing the
complaint to rescind the sale of real property to the defendant Li Seng Giap on January 22, 1940, on
the ground that the vendee was an alien and under the Constitution incapable to own and hold title
to lands, held:
In Caoile vs. Yu Chiao 49 Qff Gaz., 4321; Talento vs. Makiki 49 Off. Gaz., 4331; Bautista vs. Uy 49
Off. Gaz., 4336; Rellosa vs. Gaw Chee 49 Off. Gaz., 4345 and Mercado vs. Go Bio, 49 Off. Gaz.,
5360, the majority of this Court has ruled that in sales of real estate to aliens incapable of holding
title thereto by virtue of the provisions of the Constitution (Section 5, Article XIII Krivenko vs.
Register of Deeds, 44 Off. Gaz., 471) both the vendor and the vendee are deemed to have
committed the constitutional violation and being thus in pari delicto the courts will not afford
protection to either party. (Article 1305, old Civil Code; Article 1411, new Civil Code) From this ruling
three Justices dissented. (Mr. Justice Pablo, Mr. Justice Alex. Reyes and the writer. See Caoile vs.
Yu Chiao Talento vs. Makiki Bautista us. Uy, Rellosa vs. Gaw Chee and Mercado vs. Go
Bio). supra.
The action is not of rescission because it is not postulated upon any of the grounds provided for in
Article 1291 of the old Civil Code and because the action of rescission involves lesion or damage
and seeks to repair it. It is an action for annulment under Chapter VI, Title II, Book 11, on nullity of
contracts, based on a defect in the contract which invalidates it independently of such lesion or
damages. (Manresa, Commentarios al Codigo Civil Espanol Vol. VIII, p. 698, 4th ed.) It is very likely
that the majority of this Court proceeded upon that theory when it applied the in pari delicto rule
referred to above.
In the United States the rule is that in a sale of real estate to an alien disqualified to hold title thereto
the vendor divests himself of the title to such real estate and has no recourse against the vendee
despite the latter's disability on account of alienage to hold title to such real estate and the vendee
may hold it against the whole world except as against the State. It is only the State that is entitled by
proceedings in the nature of office found to have a forfeiture or escheat declared against the vendee
who is incapable of holding title to the real estate sold and conveyed to him. Abrams vs. State, 88
Pac. 327; Craig vs. Leslie et al., 4 Law, Ed. 460; 3 Wheat, 563, 589590; Cross vs. Del Valle, 1 Wall,
[U.S.] 513; 17 Law. Ed., 515; Governeur vs. Robertson, 11 Wheat, 332, 6 Law. Ed., 488.)
However, if the State does not commence such proceedings and in the meantime the alien
becomes naturalized citizen, the State is deemed to have waived its right to escheat the real
property and the title of the alien thereto becomes lawful and valid as of the date of its conveyance
or transfer to him. (Osterman vs. Baldwin, 6 Wall, 116, 18 Law. ed. 730; Manuel vs. Wulff, 152 U.S.

505, 38 Law. ed. 532; Pembroke vs. Houston, 79, SW 470; Fioerella vs. Jones, 259 SW 782. The
rule in the United States that in a sale of real estate to an alien disqualified to hold title thereto, the
vendor divests himself of the title to such real estate and is not permitted to sue for the annulment
Of his Contract, is also the rule under the Civil Code. ... Article 1302 of the old Civil Code
provides: ... Persons sui juriscannot, however, avail themselves of the incapacity of those with
whom they contracted; ...
xxx xxx xxx
. . . (I)f the ban on aliens from acquiring not only agricultural but, also urban lands, as construed by
this Court in the Krivenko case, is to preserve the nation's land for future generations of Filipinos,
that aim or purpose would not be thwarted but achieved by making lawful the acquisition of real
estate by aliens who became Filipino citizens by naturalization. The title to the parcel of land of the
vendee, a naturalized Filipino citizen, being valid that of the domestic corporation to which the
parcel of land has been transferred, must also be valid, 96.67 per cent of its capital stock being
owned by Filipinos.
Herrera v. Luy Kim Guan (SCRA 406) reiterated the above ruling by declaring that where land is
sold to a Chinese citizen, who later sold it to a Filipino, the sale to the latter cannot be impugned.
The appellants cannot find solace from Philippine Banking Corporation v. Lui She (21 SCRA 52)
which relaxed the pari delicto doctrine to allow the heirs or successors-in-interest, in appropriate
cases, to recover that which their predecessors sold to aliens.
Only recently, in Sarsosa vda. de Barsobia v. Cuenco (113 SCRA 547) we had occasion to pass
upon a factual situation substantially similar to the one in the instant case. We ruled:
But the factual set-up has changed. The litigated property is now in the hands of a naturalized
Filipino. It is no longer owned by a disqualified vendee. Respondent, as a naturalized citizen, was
constitutionally qualified to own the subject property. There would be no more public policy to be
served in allowing petitioner Epifania to recover the land as it is already in the hands of a qualified
person. Applying by analogy the ruling of this Court in Vasquez vs. Giap & Sons: (.96 Phil. 447
[1955])
... if the ban on aliens from acquiring not only agricultural but also urban lands, as construed by this
Court in the Krivenko case, is to preserve the nation's lands for future generations of Filipinos, that
aim or purpose would not be thwarted but achieved by making lawful the acquisition of real estate
by aliens who became Filipino citizens by naturalization.
\While, strictly speaking, Ong King Po, private respondent's vendor, had no rights of ownership to
transmit, it is likewise in escapable that petitioner Epifania had slept on her rights for 26 years from
1936 to 1962. By her long inaction or inexcusable neglect, she should be held barred from asserting
her claim to the litigated property (Sotto vs. Teves, 86 SCRA 157 [1978])

Laches has been defined as 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 ommission 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. vs.
Sibonghanoy, et al., No. L-21450, April 15, 1968, 23 SCRA 29, 35).' (Cited in Sotto vs. Teves, 86
SCRA 154 [1978]).
Respondent, therefore, must be declared to be the rightful owner of the property.
In the light of the above considerations, we find the second and third assignments of errors without
merit. Respondent Navata, the titled owner of the property is declared the rightful owner.

WHEREFORE, the instant appeal is hereby denied. The orders dismissing the complaint and
denying the motion for reconsideration are affirmed.
SO ORDERED.
Teehankee (Chairman), Melencio-Herrera, Plana, Vasquez and Relova, JJ., concur.