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December 3, 2009
he left a lot to his wife, Felisa and their nine children, one of
whom was Rosa Dalope-Funcion.
after the Funcions failed to pay their loan, the DBP foreclosed
DBP conditionally sold the lot to Sofia Quirong4 for the price
of P78,000.00.
Felisa who were each entitled to a tenth share in the subject lot.
Two months after that sale or on November 28, 1983 Felisa and
against the DBP and the Funcions before the Regional Trial
Court (RTC)
14 RTC judgment became final on January 28, 1993 and the court
prescription and res judicata but the RTC denied their motion.
20 RTC rendered a decision,11 rescinding the sale between Sofia
Quirong and the DBP and ordering the latter to return to the
metes and bounds the particular portions of the lot that would
in Civil Case D-7159, the complaint filed on June 10, 1998 was
Fontanilla.
action10 against the DBP before the RTC fro rescission of the
contract of sale between Sofia Quirong, their predecessor, and
the DBP and praying for the reimbursement of the price of
P78,000.00 that she paid the bank plus damages. The heirs
alleged that they were entitled to the rescission of the sale
because the decision in Civil Case D-7159 stripped them of
nearly the whole of the lot that Sofia Quirong, their
predecessor, bought from the DBP.
SC: YES
1
the CA did not state in its decision the date when the RTC
decision in Civil Case D-7159 became final and executory,
which decision resulted in the Quirong heirs loss of 80% of
the lot that the DBP sold to Sofia Quirong.
contract"?
But the incident before this Court in G.R. 116575 did not deal
with the merit of the RTC decision in Civil Case D-7159. That
when the DBP failed to appeal from it within the time set for
12 In the case at bar, the SC said that the cause of action of the
are distinct.
and 1381.
a
xxxx
With the loss of 80% of the subject lot to the Dalopes by reason of the
judgment of the RTC in Civil Case D-7159, the Quirong heirs had the
right to file an action for rescission against the DBP pursuant to the
provision of Article 1556 of the Civil Code which provides:
Article 1556. Should the vendee lose, by reason of the eviction, a part
of the thing sold of such importance, in relation to the whole, that he
would not have bought it without said part, he may demand the
rescission of the contract; but with the obligation to return the thing
without other encumbrances than those which it had when he acquired
it. x x x
And that action for rescission, which is based on a subsequent
economic loss suffered by the buyer, was precisely the action that the
Quirong heirs took against the DBP. Consequently, it prescribed as
Article 1389 provides in four years from the time the action accrued.
Since it accrued on January 28, 1993 when the decision in Civil Case
D-7159 became final and executory and ousted the heirs from a
substantial portion of the lot, the latter had only until January 28, 1997
within which to file their action for rescission. Given that they filed
their action on June 10, 1998, they did so beyond the four-year period.
Thus, the action of the heirs was barred by prescription.
ADA VS BAYLON
FACTS:
This case involves the estate of Spouses Florentino and
Maximina Baylon who died on November 7, 1961 and May 5, 1964
respectively. They were survived by their legitimate children namely
Rita, Victoria, Dolores, Panfila, Ramon and Lilia B. Ada (petitioner).
Dolores died intestate on August 4, 1976. Victoria died on November
11, 1981 survived by daughter Luz Adanza (petitioner). Ramon died
intestate on July 6, 1989 survived by his son Florante Baylon
(respondent) and second wife Flora with children Remo, Eric and
Ruby.
On July 3, 1986 petitioners Ada, et al. filed with the RTC a
complaint for partition, accounting and damages against Florante, Rita
and Panfila. They alleged that Spouses Baylon owned 43 parcels of
land all situated in Negros Oriental. After the death of the Spouses
Baylon, the y claimed that Rita took possession of the said parcels of
land and appropriated for herself the income from the same. Using the
income of the said land, Rita allegedly purchased two parcels of land
Lot No. 4709 and half of Lot no. 4706 in Dumaguete. Petitioners
averred that Rita refused to affect partition of the said parcels of land.
In their answer, respondents said that Lot no. 4709 and half of Lot no.
4706 were acquired by Rita using her own money and denied
petitioners allegations. Furthermore, she expressed no objection to the
partition of the estate of the Spouses Baylon but only with respect to
the co-owned parcels of land.
During the pendency of the case, Rita through a Deed of
Donation dated July 6, 1997 conveyed Lot no. 4709 and half of Lot no.
4706 in favor of nephew Florante Baylon. On July 16, 2000 Rita died
intestate. After the petitioners learned of the said donation inter vivos,
they filed a Supplemental Pleading on February 6, 2002 praying for
the said donation in favor of respondent Florante be rescinded in
accordance with Article 1381 (4) of the Civil Code. Florante and
Panfila opposed the rescission of the donation asserting that Article
1381 (4) applies only when there is already a prior juridical decree on
the ownership of the properties under litigation.
RTC declared the donation inter vivos rescinded without
prejudice to the share of Florante to the estate of Rita and directing
such parcels of land be included in the division of the property as of
Rita Baylon among her heirs. CA reversed the RTCs decision saying
that the rescission of the donation was premature. Petitioners must
first secure a favourable ruling that Lot no. 4709 and half of Lot no.
4706 belongs to the estate of Spouses Baylon and not to Rita.
ISSUE:
WON THE CA ERRED IN RULING THAT THE DONATION
INTER VIVOS OF LOT NO. 4709 and half of Lot no. 4706 IN
FAVOR OF FLORANTE MAY ONLY BE RESCINDED IF THERE
IS ALREADY A JUDICIAL DETERMINATION THAT THE SAME
ACTUALLY BELONGED TO THE ESTATE OF SPOUSES
BAYLON?
HELD:
YES THE CA ERRED IN RULING THAT THE DONATION INTER
VIVOS OF LOT NO. 4709 and half of Lot no. 4706 IN FAVOR OF
FLORANTE MAY ONLY BE RESCINDED IF THERE IS
ALREADY A JUDICIAL DETERMINATION THAT THE SAME
ACTUALLY BELONGED TO THE ESTATE OF SPOUSES
BAYLON
Voidable Contracts
Samonte vs. CA (Voidable Contracts)
Facts:
There was a parcel of land (lot No. 216) which was a subject of
dispute situated in Agusan del Norte covered by original certificate of
title RO 238 (555) issued in the name of Apolonia Abao and the
daughter Irenea Tolero pro indiviso.
Two cases were separately filed in RTC. The first case was an
action for quieting of title and recovery of possession of a parcel of
land formed the entire property. On the other hand, the second case
had similar action except that a portion of land was involve in the
entire lot 216. Both cases were filed by the heirs of Abao and Tolero.
Complaint sought the annulment of several CTC covering
portion of lot 216 and the reinstatement of OCT No. RO 238 (555).
The defendants in the second case were Jadol spouses, Jacobo
Tagorda, and Aurelio Rotor as herein petitioners.
The litigation that stems out the second cases started when the
OCT No. RO 238 (555) issued in 1927 in the name of Apolonia Abao
and Irenea Tolero in equal undivided shares was administratively
reconstituted on August 8, 1957 based on an Affidavit of Extrajudicial
Settlement and Confirmation of Sale.
That OCT No. RO 238 was cancelled in lieu thereof TCT No.
RT 476 issued in the name of Irenea Tolero and Nicholas Jadol and
that each of them has half of the shares of the property. On Feb. 13,
1959 based on subdivision plan subdividing the lots, the Register of
Deeds cancelled the TCT No. RT 476 and issued RT 553 in the name
of Tiburcio Samonte as to lot 216-A and TCT No. RT- 554. For lot
216-B, it was then cancelled to issue TCT No. RT 555 issued in the
name of Jacobo Tagorda and TCT No. 556 in the name of Irenea
Tolero.
Plaintiff claim ownership of the entire lot as of the area 12,
753 sq.m was registered in the name of their Mother Irenea Tolero and
half to their grandmother Apolonia Abao. They also questioned the
series of cancellation of certification of titles starting from the original
title and the Deed of Extra Judicial Settlement and Confirmation of
Sale executed by Ignacio Atupan who claim to be the sole son of
Apolonia Abao and that the predecessors in interest have not signed
ground that said petitioner was only a trustee on an implied trust of the
property. The court resolved on the issue of prescription. Said
petitioner, registered the property in 1955 and the claim of private
respondents was presented in 1974.
Right of private respondents commenced from the time they
actually discovered petitioners act of defraudation. Based on Article
1456, the civil code indicates implied and constructive trust.
This law provides that If the 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.
It can be said that the Jadol Spouses were trustees on behalf of
the heirs of Abao. An action based on implied or constructive trust
prescribes in 10 years from the time of its creation or upon the alleged
fraudulent registration of the property. Hence, prescription is not a bar.
Issue: Whether or not the petitioner is a buyer in good faith.
Ruling:
The SC ruled in the negative. Petitioner cannot pretend to be a
purchaser in good faith. It is axiomatic that one who buys from a
person who is not a registered owner is not a purchaser in good faith.
Respondents were the only surviving heirs of Irenea Tolero.
Despite this knowledge, petitioner still bought a portion of the subject
lot from the Jadol Spouses on July 20. 1957when the same was still
registered under OCT No. RO 238 (555) in the name of Abao and
Tolero.
The general rule is that a person dealing with registered land
has a right to rely on the Torrens Certificate of Title and to dispense
with the need of making further inquiries. This rule, however admits of
exceptions when the party has actual knowledge of facts and
circumstances that would impel a reasonably cautious man to make
such inquiry or when the purchaser has knowledge of a defect or the
lack of title of the property in litigation. One who falls within the
exception can neither be denominated an innocent purchaser for value
nor a purchaser in good faith.
Petitioner cannot claim that he already acquired a valid title to
the property. The inscription in the registry to be effective must be
made in good faith.
1989, Carmen Ozamiz was already ailing and not in full possession of
her mental faculties.
During the case, the petitioners presented the Notarized Deed of
Absolute Sale and witnesses who testified for the regularity of the said
document, on the other hand the respondents presented different
testimonials and the dispositions of Dr. Faith Go, physician of Carmen
Ozamiz.
The trial court rendered its decision in favor of the petitioners
upholding the validity of the contract and further stating said contract
was voluntarily and deliberately entered into while Carmen Ozamiz
was of sound mind. Upon appeal, the CA reversed the factual findings
of the RTC.
ISSUE: WON the wards mental faculties were seriously impaired
when she executed the contract to warrant its nullity.
RULING:
NO.
The Supreme Court rules that the appellate court erred in ruling that at
the time of the execution of the Deed of Absolute Sale on April 28,
1989 the mental faculties of Carmen Ozamiz were already seriously
impaired. The testimonies of the respondents witnesses on the mental
capacity of Carmen Ozamiz are far from being clear and convincing.
Carolina Lagura, househelper of Carmen Ozamiz, testified that when
Paz Montalvan confronted Carmen about the sale of Lahug property,
Carmen denied the same. She testified that Carmen understood the
question then. Laguras declaration is inconsistent with her statement
that since 1988 Carmen could not fully understand the things around
her.
The revelation of Dr. Faith Go did not also shed light on the mental
capacity of Carmen Ozamiz when she executed and notarized the Deed
of absolute Sale on April 28, 1989. Dr. Go merely revealed that
Carmen was suffering from certain infirmities in her body and at time
forgetful, but there was no categorical statement that Carmen
succumbed to what the respondents suggest as her alleged second
childhood. Dr. William Buot testified that there was no conclusion o
mental incapacity ever written in Dr. Gos clinical note.
It has been held that a person is not incapacitated to contract merely
because of advanced age or because of physical infirmities. Only when
such age or infirmities impair her mental faculties to such extent as to
The petitioner in this case is a seaman who alleges that his consent was
vitiated when he signed a form releasing his employer from any and all
"cannot go back to sea duty and has been observed for 120 days,
he worked as a messman.
Hansa Riga, a vessel registered and owned by its principal and co-
On June 21, 1990, while Hansa Riga was docked at the port of
Eureka, California, U.S.A. and while petitioner was assisting in the
loading operations, the latter complained of a headache. Petitioner
PETITIONERS ARGUMENTS:
he signed the subject document, the same cannot still lead to the
conclusion that he did not voluntar[il]y accept the agreement, for his
Petitioner claims that he did not sign the Receipt and Release
attached by petitioner in his appeal does not show on its face any
violation of law or public policy. In fact, petitioner did not present any
proof to show that the consideration for the same is not reasonable and
acceptable. Absent any evidence to support the same, the Court cannot,
on its own accord, decide against the unreasonableness of the
consideration.
It is true that quitclaims and waivers are oftentimes frowned upon and
are considered as ineffective in barring recovery for the full measure of
the workers right and that acceptance of the benefits therefrom does
not amount to estoppel. The reason is plain. Employer and employee,
obviously do not stand on the same footing. However, not all waivers
and quitclaims are invalid as against public policy. If the agreement
was voluntarily entered into and represents a reasonable settlement, it
is binding on the parties and may not later be disowned simply because
of change of mind. It is only where there is clear proof that the waiver
was wangled from an unsuspecting or gullible person, or the terms of
the settlement are unconscionable on its face, that the law will step in
to annul the questionable transaction. But where it is shown that the
Granting that petitioner has not fully recovered his health at the time
the terms and conditions contained in the Receipt and Release and we
find the same to be clear and unambiguous. The signing was even
I hereby certify that I am of legal age and that I fully understand this
and all claims, demands, debts, dues, liens, actions or causes of action,
instrument which was read to me in the local dialect and I agree that
contractual, arising from and under the laws of the United States of
parties and things referred to herein, and I further agree that this
release may be pleaded as an absolute and final bar to any suit or suits
one claiming by, through, or under me, against any of the persons or
11, 1997, more than three years have elapsed thereby effectively
or related herein.
WHEREFORE, the petition is DENIED. The Decision of the Court of
It is elementary that a contract is 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
However, the RTC annulled the deed of absolute sale and
ordered petitioners to vacate the lot and remove all improvements
therein, and ordered Florentino to return the consideration of the sale
with interest. The CA affirmed the RTCs decision.
Issue: WON the sale by Florentino without Eliseras consent valid
Ruling: The sale is voidable.Under Article 178 of the Civil Code, the
separation in fact between husband and wife without judicial approval
shall not affect the conjugal partnership. The lot retains its conjugal
nature.Applying Article 166 of the Civil Code, the consent of both
Elisera and Florentino is necessary for the sale of a conjugal property
to be valid. In this case, the consent of Elisera was not obtained when
Florentino verbally sold the lot in 1985 and executed the Deed of
Absolute Sale on 1992. Accordingly, the contract entered by
Florentino is annullable. Moreover, Elisera timely questioned the sale
within ten years (Art 173) from the date of sale and execution of the
deed.As evidence, she presented a real property tax declaration
acknowledging her and Florentino as owners of the lot and that they
also categorically declared in the MOA they executed that the lot is a
conjugal property.
Now, if a voidable contract is annulled, the restoration of what
has been given is proper. The effect of annulment of the contract is to
wipe it out of existence, and to restore the parties, insofar as legally
and equitably possible to their original situation before the contract
was entered into. Applying Article 1398 to the instant case, the SC
ruled that petitioners Villanueva should return to
respondentsChiongthe land with its fruits and respondent Florentino
should return the sum of money he received as the price of the land,
not included the payment of interest.
Art. 178 The separation in fact between husband and wide without
judicial approval, shall not affect the conjugal partnership
Art. 160 All property of the marriage is presumed to belong to the
conjugal partnership; unless it be proved that it pertains exclusively to
the husband or to the wife.
Art. 166 Unless the wife has been declared a spendthrift, or is under
civil interdiction or is confined in a leprosarium, the husband cannot
alienate or encumber any real property of the conjugal partnership
without the wifes consent..
Art. 1398 An obligation having been annulled, the contracting parties
shall restore to each other the things which have been the subject
matter of the contract, with their fruits, and the price with its interest,
except in cases provided by law.
In obligations to render service, the value thereof shall be the basis for
damages.
G.R. No. 146730|July 4, 2008|NACHURA, J.:
AMADO Z. AYSON, JR. vs. SPOUSES FELIX and MAXIMA
PARAGAS
FACTS:
The subject of this controversy is the one-fourth (1/4) portion of,
corresponding to the share of respondent Maxima Paragas in, the real
property located at Caranglaan District, Dagupan City, originally
covered by Transfer Certificate of Title No. 7316 of the Register of
Deeds of Dagupan City.
The controversy commenced with the filing of an ejectment
complainton April 12, 1993 before Branch 1 of the Municipal Trial
Court in Cities (MTCC) of Dagupan City by herein petitioner Amado
Z. Ayson, as represented by his natural father Zosimo S. Zareno
(Zareno), against respondent-spouses Felix and Maxima Paragas. The
complaint, docketed as Civil Case No. 9161, alleged, among others,
that: (1) petitioner is the registered owner of the property being
occupied by the respondent-spouses as shown by Transfer Certificate
of Title No. 59036 of the Registry of Deeds of Dagupan City in his
name; (2) respondent-spouses are occupying the said land through his
tolerance without rent; (3) on April 8, 1992, respondent-spouses
executed an Affidavit which declared:
1. That we are occupants of a parcel of land (Lot 6595-A-2) covered
by Transfer Certificate of Title No. 57684 located at Caranglaan
District, Dagupan City owned by Amado Ll. Ayson;
2. That we occupy the said land by tolerance without paying any
rental whatsoever;
3. That we further agree to vacate the aforesaid land within three (3)
months from the date hereof and to remove and transfer our house
therefrom to another place;
4. That in consideration of vacating the said parcel of land the
amount of Twenty Thousand Pesos (P20,000.00) shall be paid to us;
and, that the amount of Ten Thousand Pesos (P10,000.00) shall be paid
upon signing of this affidavit and the balance of Ten Thousand Pesos
(P10,000.00) shall be paid upon removal of our house on the third
month from date hereof.
(4) despite the receipt of the P10,000.00 upon the execution of the
Affidavit, respondent-spouses refused to vacate the land as agreed
upon; and (5) despite demands, respondent-spouses still refused to
vacate, thus constraining him to file the complaint. Aside from
respondents vacating the land, petitioner prayed for the return of
the P10,000.00 he paid them; and the payment of P10,000.00 actual
damages, P10,000.00 exemplary damages, P20,000.00 attorneys fees,
and the costs.
In their Answer, respondent-spouses alleged that Zareno had no
personality and authority to file the case and the filing of the complaint
was made in bad faith.
During the preliminary conference, the following admissions were
made
By petitioner:
(1) That the defendants (respondent spouses) had been in possession
of the land in question since 1930; and
(2) That the semi-concrete house of the defendants (respondent
spouses) stands on the land in question.
By respondent spouses:
(1) That the defendant (respondent) Felix Paragas had executed an
affidavit on April 8, 1992 wherein he admitted that he is occupying the
land by tolerance of the plaintiff (petitioner) without paying any rental
whatsoever and had agreed to vacate the premises within three (3)
months but refused to vacate later;
(2) That the plaintiff (petitioner) is the registered owner of the land
in question;
(3) That there was a demand to vacate the premises; and
(4) That there is a Certification to File Action in Court.
On August 31, 1993, the MTCC, Branch 1, Dagupan City decided in
favor of petitioner, based mainly on the above admissions.
Meanwhile, on October 11, 1993, during the pendency of the appeal
with the RTC, respondent-spouses filed against petitioner, as
represented by his attorney-in-fact Zosimo S. Zareno, the heirs of Blas
F. Rayos, the spouses Delfin and Gloria Alog, and Hon. Judge George
M. Mejia, as Presiding Judge of the Metropolitan Trial Court, Branch 1
of Dagupan City, also before the RTC of Dagupan City, a
complaint for declaration of nullity of deed of sale, transactions,
But more than plausible evidence was required of Plazo and Alaras. An
allegation of fraud with regard to the execution of a notarized deed of
absolute sale is a grave allegation. It cannot be declared on mere
speculations. In fact, to overcome the presumption of regularity and
due execution of a notarized deed, there must be clear and convincing
evidence showing otherwise. The burden of proof to overcome the
presumption lies on the one contesting the same. Without such
evidence, the presumption remains undiminished.
Ruling
The CA held that the Destrezas could not just rely on the deed of sale
in their favor or on the TCT issued in their names. They needed to
present further evidence to prove the authenticity and genuineness of
that deed. Having failed to do so, the CA theorized that it was justified
in annulling that deed of sale and the corresponding TCT.
The ruling of the CA was correct. Indeed, the notarized deed of sale
should be admitted as evidence despite the failure of the Notary Public
in submitting his notarial report to the notarial section of the RTC
Manila. It is the swearing of a person before the Notary Public and the
latters act of signing and affixing his seal on the deed that is material
and not the submission of the notarial report.
Thus, the notarized deed of sale executed by Rioza is admissible as
evidence of the sale of the Utod sugarland to the Destrezas.
The CA, however, made a mistake with regard to the assignment of the
burden of proof. No rule requires a party, who relies on a notarized
deed of sale for establishing his ownership, to present further evidence
By signing and affixing his notarial seal on the deed, Atty. Ducusin
converted it from a private document to a public document. As such,
the deed of sale is entitled to full faith and credit upon its face. And
since Rioza, the executor of the deed, is already dead, the notarized
deed of absolute sale is the best evidence of his consent to the sale of
the Utod sugarland to the Destreza spouses.
Since respondents Plazo and Alaras claim that grave and serious
doubts plague TCT 55396, the burden is on them to prove such claim.
Only when they are successful in doing so will the court be justified in
nullifying the notarized deed of sale that their father Rioza executed
in favor of the Destrezas.
for the difference in the prices can be explained only by Rioza and
Gregorio Destreza. Unfortunately, Rioza had died. On the other hand,
Plazo and Alaras chose not to confront Destreza regarding that
difference when the latter took the witness stand.
In sum, the Court finds the notarized deed of sale that the late Pedro
Rioza executed in favor of the Destrezas valid and binding upon them
and their successors-in-interest. It served as authority to the Register of
Deeds to register the conveyance of the property and issue a new title
in favor of the Destrezas. That the Destrezas occupied and cultivated
the land openly for seven years before and after Riozas death negates
any scheme to steal the land.
KINGS PROPERTIES CORP., VS. CANUTO A. GALIDO
G.R. No. 170023, November 27, 2009
FACTS:
This case involves an action for cancellation of certificates of title,
registration of deed of sale and issuance of certificates of title filed by
Canuto A. Galido (respondent) before RTC of Antipolo City.
On 18 April 1966, the heirs of Domingo Eniceo, namely Rufina
Eniceo and Maria Eniceo, were awarded withHomestead Patent
consisting of four parcels of land located in San Isidro, Antipolo,
Rizal.
The Antipolo property with a total area of 14.8882 hectares was
registered under Original Certificate of Title(OCT) No. 535.
The issuance of the homestead patent was subject to the following
conditions:
To have and to hold the said tract of land, with the appurtenances
thereunto of right belonging unto the said Heirs of Domingo Eniceo
and to his heir or heirs and assigns forever, subject to the provisions of
sections 118, 121, 122 and 124 of Commonwealth Act No. 141, as
amended, which provide that except in favor of the Government or any
of its branches, units or institutions, the land hereby acquired shall
be inalienable and shall not be subject to incumbrance for a period
of five (5) years next following the date of this patent, and shall not
be liable for the satisfaction of any debt contracted prior to the
expiration of that period; that it shall not be alienated, transferred
or conveyed after five (5) years and before twenty-five (25) years
next following the issuance of title, without the approval of the
Secretary of Agriculture and Natural Resources; that it shall not be
incumbered, alienated, or transferred to any person, corporation,
Unenforceable Contracts
Regal Films vs. Concepcion
Facts:
No.
An amicable settlement is an agreement between the
parties to put an end or to prevent a lawsuit. It is in
essence a contract because it has all the essential
elements of a contract.
In this case, Concepcion first attacked the validity of
the amicable settlement because, according to him, it
was without his consent as it was entered into by Solis,
who was no longer his manager.
Contracts entered into in the name of another by one
without the authority to do so are unenforceable but
can still be subjected to the ratification of the person
whose name was used to enter into such contract.
However, such ratification must be done before the
revocation of the contract.
In this case, it was already too late for Concepcion to
ratify the amicable settlement because Regal had
already revoked their offer in the settlement. And thus,
no ratification can be done by him.
Lingtonjua vs Fernandez
The FACTS of the case are as follows:
The petitioners in this case were offered to buy two parcels of land by
two brokers, one Lourdes Alimario and one Agapio Fisico, who were
allegedly authorized to offer the properties to sell by the respondent
Mary Grace Fernandez . Such properties were originally owned the
heirs of Domingo Ticzon represented by Maria Mediatrix Fernandez
and the heirs of Paz Ticzon Eleosida represented by Gregorio T.
Eleosida. The petitioners were shown a locator plan and copies of the
titles of the subject properties. They the conducted two ocular
inspections in the properties where they found people gathering
coconuts.
Then on the afternoon of November 27, 1995, the petitioners met with
the respondent and the two brokers where they agreed that:
1.) the petitioners will be buying the properties for P5,08,500.00;
2.) the owners will be shouldering the taxes as well as the
documentation expenses; and
3.) they also agreed to meet again on December 8, 1995 to finalize the
transaction.
In the case of City of Cebu vs Heirs of Rubi, the supreme court held
that written correspondence or letters exchanged by the parties may
constitute sufficient evidence of the agreement between the parties in
compliance with the statute of frauds.
Even if the letter can now provide as evidence, still the court cited the
case of Rosencor Development vs Court of Appeals that in order for
the note or memorandum to satisfy the statute of frauds it must contain
the following:
1.) the names of the parties;
2.) the terms and conditions of the contract; and
3.) a description of the property sufficient to render it capable of
identification.
Here, the January 16, 1996 letter did not contain the second and third
requisites sufficient to render it in compliance with the statute of
frauds. Further, the letter made reference only to one of the properties
herein involved which is the one owned by the heirs of Domingo
Ticzon.
The Supreme Court also held in the case of Rosencor that in order to
be binding on the party to be charged, the note or memorandum must
be signed by such party or by his agent duly authorized in writing. In
this case, however the only evidence presented to prove that the
respondent was indeed authorized to sell or offer the properties for sale
was the mere declaration of the petitioner Litongjua that the
respondent openly represented herself as a representative of the owner.
There being no written evidence to prove such authority, the
respondent is therefore not an agent of the owners of the properties.
Judging from the forgoing facts, therefore, there was no perfection of
the sale between the respondent as the seller and the petitioners as the
buyer by reason of the non-compliance with the statute of frauds.
Gozun
Monaifah
Cabales
Shelu
Lina Penalber vs Quirino and Leticia Ramos and Bartex INC.
Facts:
Petitioner Lina Penalber is the mother of respondent Leticia
Ramos and the mother-in-law of respondent Quirino Ramos.
The fact that respondent spouses Ramos never denied the P116,946.15
difference, or that they failed to present proof that they indeed used the
said amount to pay the other obligations and liabilities of petitioner is
not sufficient to discharge petitioners burden to prove the existence
of the alleged express trust agreement.
Ruling:
decided favor of petitioners. The RTC ruled that since the Deed
public document.
(2) Those that do not comply with the Statute of Frauds as set
Issue:
Whether the subject Deed of Sale is invalid on the ground that
it does not appear in a public document or not.
xxxx
(e) An agreement for the leasing for a longer period than one
year, or for the sale of real property or of an interest
therein; x x x27
Under Article 1403(2), the sale of real property should be in
writing and subscribed by the party charged for it to be
enforceable. In the instant case, the Deed of Sale between
Pedro and Marcos is in writing and subscribed by Pedro and
his wife Francisca; hence, it is enforceable under the Statute of
Frauds.
However, not having been subscribed and sworn to before a
notary public, the Deed of Sale is not a public document and,
therefore, does not comply with Article 1358 of the Civil Code.
Nonetheless, it is a settled rule that the failure to observe the
proper form prescribed by Article 1358 does not render the acts
or contracts enumerated therein invalid. It has been uniformly
held that the form required under the said Article is not
essential to the validity or enforceability of the transaction, but
merely for convenience. Article 1358 does not require the
accomplishment of the acts or contracts in a public instrument
Landbank
Dalanon
Void Contracts
G.R. No. 109355 October 29, 1999
SERAFIN MODINA v. Court of Appeals, Et. Al
FACTS: The parcels of land in question are those under the name of
private respondent CHIANG. He theorized that subject properties were
sold to him by his wife MERLINDA, as evidenced by a Deed of
Absolute Sale, and were subsequently sold by CHIANG to the
petitioner MODINA, as shown by the Deeds of Sale.
MODINA brought a Complaint for Recovery of Possession with
Damages against the private respondents, Ernesto Hontaciergo, Paul
Figueroa and Teodoro Hipalla before the RTC of Iloilo City.
Upon learning the institution of the said case, MERLINDA presented a
Complaint-in-intervention, seeking the declaration of nullity of the
Deed of Sale between her husband and MODINA on the ground that
the titles of the parcels of land in dispute were never legally transferred
to her husband. Fraudulent acts were allegedly employed by him to
obtain a Torrens Title in his favor. However, she confirmed the validity
of the lease contracts with the other private respondents.
MERLINDA also admitted that the said parcels of land were those
ordered sold by Branch 2 of the then Court of First Instance of Iloilo in
Special Proceeding No. 2469 in Intestate Estate of Nelson Plana
where she was appointed as the administrator, being the widow of the
deceased, her first husband. An Authority to Sell was issued by the
said Probate Court for the sale of the same properties.
After due hearing, the Trial Court decided in favor of MERLINDA
declaring as void and inexistent the sale of Lots. CA affirmed the
aforesaid decision in toto. Petitioner found his way to this Court via
the present Petition for Review under Rule 45 seeking to set aside the
assailed decision of the Court of Appeals.
ISSUES:
1 Whether the sale of subject lots should be nullified;
2 Whether petitioner was not a purchaser in good faith;
RULING: Anent the first issue, petitioner theorizes that the sale in
question is null and void for being violative of Article 1490 of the New
Civil Code prohibiting sales between spouses. Consequently, what is
applicable is Article 1412 supra on the principle of in pari delicto,
which leaves both guilty parties where they are, and keeps undisturbed
the rights of third persons to whom the lots involved were sold;
petitioner stressed.
Petitioner anchors his submission on the following statements of the
Trial Court which the Court of Appeals upheld, to wit:
Furthermore, under Art. 1490, husband and wife are
prohibited to sell properties to each other. And where, as in this case,
the sale is inexistent for lack of consideration, the principle of in pari
delicto non oritur action does not apply. (Vazques v. Porta, 98 Phil
490).
Thus, Art. 1490 provides:
Art. 1490. The husband and wife cannot sell property to each
other, except:
1 When a separation of property was agreed upon in the
marriage settlements; or
2 When there has been a judicial separation of property
under Art. 191.
The exception to the rule laid down in Art. 1490 of the New Civil
Code not having existed with respect to the property relations of
Ramon Chiang and Merlinda Plana Chiang, the sale by the latter in
favor of the former of the properties in question is invalid for being
prohibited by law. Not being the owner of subject properties, Ramon
Chiang could not have validly sold the same to plaintiff Serafin
Modina. The sale by Ramon Chiang in favor of Serafin Modina is,
likewise, void and inexistent.
The principle of in pari delcto non oritur action denies all recovery of
the guilty parties inter se. It applies to cases where the nullity arises
from the illegality of the consideration or the purpose of the contract.
When two persons are equally at fault, the law does not relieve them.
The exception to this general rule is when the principle is invoked with
respect to inexistent contracts.
In the petition under consideration, the Trial Court found that subject
Deed of Sale was a nullity for lack of any consideration. This finding
duly supported by evidence was affirmed by the Court of Appeals.
Well-settled is the rule that this Court will not disturb such finding
absent any evidence to the contrary.
Petitioners insistence that MERLINDA cannot attack subject contract
of sale as she was a guilty party thereto is equally unavailing. But the
pivot of inquiry here is whether MERLINDA is barred by the principle
of in pari delicto from questioning subject Deed of Sale.
necessary inquiries, and then claim that he acted in good faith. His
mere refusal to believe that such defect exists, or his willful closing of
his eyes to the possibility of the existence of a defect in his vendors
title, will not make him an innocent purchaser for value, if it
afterwards develops that the title was in fact defective, and it appears
that he had such notice of the defect as would have led to its discovery
had he acted with that easure of precaution which may reasonably be
required of a prudent man in a like situation.
Thus, petitioner cannot claim that the sale between him and MODINA
falls under the exception provided for by law.
Domingo vs. Court of Appeals
G.R. No. 127540, Oct. 17, 2001
Facts:
Paulina Rigonan owned three parcels of land, located at Batac
and Espiritu, Ilocos Norte- house and warehouse on one parcel.
She allegedly sold them to private respondents, Sps. Felipe and
Concepcion Rigonan, who claim to be her relatives.
1966- herein petitioners Eugenio Domingo, Crispin Mangabat
and Samuel Capalungan, who claim to be her closest surviving
relatives, allegedly took possession of the properties by means
of stealth, force and intimidation, and refused to vacate the
same.
February 2, 1976- Felipe Rigonan filed a complaint for
reinvindicacion against petitioners in the RTC of Batac, Ilocos
Norte. He likewise amended his complaint including his wife
as co-plaintiff.
They alleged that they were the owners of the three parcels of
land through the deed of sale executed by Paulina Rigonan on
January 28, 1965.
o They had been in continuous possession of the subject
properties and had introduced permanent improvements
thereon
o And that petitioners entered the properties illegally, and
they refused to leave them when asked to do so.
However, these allegations were contested by the petitioners
arguing that the alleged deed of sale was void for being
spurious as well as lacking consideration.
receive any notice nor any offer to sell the lots from
Paulina
o Ruben- testified that only the carbon copy (also called
duplicate original) of the deed was in their records, but
he could not explain why this was so.
o Zosima- testified that she was the wife of Eugenio and
they lived with Paulina and husband Jose Guerson since
1956 and that they took care of her, spent for her daily
needs and medical expenses, especially when she was
hospitalized prior to her death; likewise stated that
Paulina was never badly in need of money during her
lifetime.
RTC- rendered judgment in favour of petitioners declaring the
alleged deed of sale as null and void and fake and the prayer
for the issuance of preliminary injunction denied.
Upon appeal by the respondents to the CA, the CA reversed the
RTC ruling declaring Felipe and Concepcion Rigonan as the
owners of the properties in litigation.
Hence this present appeal.
ISSUE: Whether or not the respondent Sps. Rigonan sufficiently
established the existence and due execution of the deed of sale.
Held: NO! The Supreme Court ruled in the negative.
1 PR- presented only a carbon copy of the alleged deed of sale.
a When the Register of Deeds was subpoenaed to
produce the deed, no original typewritten deed but only
a carbon copy was presented to the trial court.
i The deed contained filled in blanks and
altercations.
b None of the witnesses directly testified to prove
positively and convincingly Paulinas execution of the
Deed of Sale.
c Carbon copy- did not bear her signature, but only her
alleged thumbprint.
d Juan Franco- who was presented by the respondents as
witness to the execution of the deed retracted his
statement and said that he categorically knew nothing
about the deed.
BAUTISTA v SILVA
GR No. 157434
The facts of the case, as found by the RTC, are as follows:
Spouses Berlina Silva and Pedro Silva were the owners of a parcel of
land with a Transfer Certificate of Title No B-37189, which was
registered on August 14, 1980 in their names.
On March 3, 1988, Pedro , for himself and as attorney-in-fact of his
wife Berlina, thru a Special Power of Attorney purportedly executed
by Berlina in his favor, executed a Deed of Absolute Sale over the said
parcel of land in favor of defendants-spouses Claro Bautista and Nida
Bautista.
faith.
A holder of registered title may invoke the status of a buyer for value
That the SPA is a forgery is a finding of the RTC and the CA on a
than clear, positive and convincing evidence that respondent did not
sign the SPA, and on the uncontroverted Certification of Dorado that
A buyer for value in good faith is one who buys property of another,
without notice that some other person has a right to, or interest in, such
property and pays full and fair price for the same, at the time of such
In the present case, petitioners were dealing with a seller (Pedro) who
had title to and possession of the land but, as indicated on the face of
his title, whose capacity to sell was restricted, in that the marital
belief that the person from whom he receives the thing had title to
To prove good faith then, petitioners must show that they inquired not
only into the title of Pedro but also into his capacity to sell.
To prove good faith, a buyer of registered and titled land need only
show that he relied on the face of the title to the property. He need not
beyond the four corners of the title.37 Such degree of proof of good
brought said copy to Atty. Lorenzo Lucero (the notary public who
concur: first, the seller is the registered owner of the land; 38 second,
prepared the deed of sale) and asked whether it was genuine;46 and
the latter is in possession thereof;39 and third, at the time of the sale,
third, they inspected the original copy of the SPA after they advanced
the buyer was not aware of any claim or interest of some other person
Absent one or two of the foregoing conditions, then the law itself puts
the buyer on notice and obliges the latter to exercise a higher degree of
The RTC and CA, however, found such inquiry superficial. They
of respondent at the time of the execution of the SPA48 but also into the
Remember that it is not just any scrap of paper that is under scrutiny
but a SPA, the execution and attestation of which a notary public has
intervened.
photocopy that was relied upon by petitioners before they entered into
the deed of sale with Pedro. As admitted to by petitioner Nida Bautista,
In sum, all things being equal, a person dealing with a seller who has
possession and title to the property but whose capacity to sell is
restricted, qualifies as a buyer in good faith if he proves that he
inquired into the title of the seller as well as into the latter's capacity to
not prove anything more for it is already the function of the notarial
would indicate that the notary public has officially signed it.58 There
being no notarial seal, the signature of the notary public on the notarial
certificate was therefore incomplete. The notarial certificate being
Note that we expressly made the foregoing rule applicable only under
the operative words "duly notarized" and "all things being equal."
Thus, said rule should not apply when there is an apparent flaw
afflicting the notarial acknowledgment of the special power of attorney
All told, it was not sufficient evidence of good faith that petitioners
mere photocopy and we are not convinced that there ever was an
original copy of said SPA as it was only this photocopy that was
they looked beyond it. They did not. Instead, they took no precautions
at all. They verified with Atty. Lucero whether the SPA was authentic
but then the latter was not the notary public who prepared the
document. Worse, they purposely failed to inquire who was the notary
public who prepared the SPA. Finally, petitioners conducted the
transaction in haste. It took them all but three days or from March 2 to
and since there was no restraining order from the HLURB, the
Sheriff proceeded the public auction. The sum of P5, 313, 040
was turned over to spouses Hulst in satisfaction of the judgment
award.
Four months later, HLURB issued an order setting aside the
Sheriffs levy on the properties.
Hulst filed a Petition for Certiorari with the CA, which the CA
dismissed.
Hence, this petition.
ISSUES:
WON the Contract to Sell between Hulst and PR Builders is
valid.
WON Hulst can claim recovery of what he has given under the
contract.
RULING:
The contract is void.
Sec 7 of Article 12 the 1987 Consti provides, no private lands shall
be transferred or conveyed except to individuals, corporations, or
associations qualified to acquire or hold lands of the public
domain. The Constitution reserved the right to acquire and hold lands
of public domain for Filipino citizens. Therefore, the spouses Hulst,
being Dutch nationals, are disqualified under the Constitution from
owning real property.
Art. 1409 provides that, all contracts whose cause, object or purpose
is contrary to law or public policy and those expressly prohibited or
declared void by law are inexistent and void from the beginning.
Therefore, the Contract to Sell is void for being contrary to law.
Hulst can recover what he has paid under the void contract.
Generally, parties to a void agreement cannot expect the aid of law; the
courts leave them as they are, because they are deemed in pari delicto.
However this rule is subject to exceptions that permit the return of that
which may have been given under the void contract. One of the
exceptions is, Art. 1414 which provides that, When money is paid or
property delivered for an illegal purpose, the contract may be
repudiated by one of the parties before the purpose has been
accomplished, or before any damage has been caused to a third
person. In such case, the courts may, if the public interest will thus be
subserved, allow the party repudiating the contract to recover the
money or property.
The contract entered upon by Hulst and PR Builders, is a Contract to
Sell. In a Contract to Sell, the prospective seller agrees to transfer
ownership of the property upon the full payment of the purchase price.
Then the seller has to convey the title to the buyer by executing a
Contract of Absolute Sale. In this case, ownership has not yet
transferred to Hulst when he filed the suit for rescission. While the
intent to circumvent the constitutional proscription was evident by
virtue of the execution of the Contract to Sell, such violation of the law
or illegal purpose did not materialize because Hulst caused the
rescission of the contract before the execution of the final deed
transferring ownership.
Therefore, applying Article 1414, Hulst is entitled to the recovery of
the amount of P3, 187, 500, representing the purchase price. However,
he is not entitled to damages as no damages may be recovered on the
basis of a void contract. Court ordered Hulst to return the P2, 125, 540,
in excess of the proceeds of the auction sale of the 15 parcels of land
delivered to petitioner.
Quimpo V Beltran
Facts:
Eustaquia Perfecto-Abad was the owner of several parcel of lands. In
1948, she died intestate leaving all her properties to her grandchild,
petitioner Joaquin Quimpo, and to her great grandchildren,
respondents Consuelo, Ireneo, Danilo, Marites, Anita and Helen.
In 1966, petitioner and respondents entered into an oral partition over
the parcel of lands. They agreed that half of the properties are to be
given to Joaquin and the other half would be divided among
respondents. However, no document of partition was executed.
Joaquin also became the administrator of the remaining undivided
properties since some of the respondents were still minor at that time.
Before Francisco Jr. and Victor could pay the balance of the contract
price for Gonzalezs RBA shares of stock, Gonzalez entered into
another contract involving the very same shares. Since the stock
certificates covering the shares were already in Victors possession,
Gonzalez immediately wrote Victor a letter,[11] demanding that Victor
hand over the said stock certificates to Francisco III, the supposed new
owner of the shares.
The next day, on 28 February 1996, Francisco Jr. arrived from the
United States of America. He and Victor then promptly proceeded to
the residence of Gonzalez in order to pay the balance of P150, 000.00
of the purchase price stated in their Contract to Sell with
Gonzalez. Gonzalez, however, informed them that he already sold his
shares of stock to Francisco III. After discussing the matter, Gonzalez
was somehow convinced to accept the balance of the purchase price
and sign his name at the dorsal portion of the stock certificates to
endorse the same to Francisco Jr. Gonzalez also executed a Deed of
Absolute Sale in favor of Francisco Jr.
Consequently, on 14 March 1996, Victor filed a Petition requesting
that the transfer of Gonzalezs RBA shareholdings to Francisco Jr. be
annotated on the RBA Corporate Transfer Book and new stock
certificates be issued in favor of Francisco Jr. Francisco III, on the
other hand, prayed for judgment ordering (a) Victor to surrender
Gonzalezs stock certificates in order that the same may be transferred
to Francisco IIIs name; and (b) Francisco Jr. and Victor to desist from
attempting to register the purported sale by Gonzales of his RBA
shares of stock to Francisco Jr., who had already become a naturalized
American citizen and was, thus, disqualified from owning shares in
RBA under RA 7357which states that the capital stocks of any rural
bank shall be fully owned and held directly or indirectly by citizens of
the Philippines.
ISSUE: WON the sale of shares of stock of Gonzales to Francisco Jr.
is null and void ab ignition on the basis of the alleged disqualification f
Francisco Jr under RA 7353. YES
RUING: As the Court of Appeals declared, Francisco Jr. was
disqualified from acquiring Gonzalezs shares of stock in RBA. The
argument of Francisco Jr. and Victor that there was no specific
provision in Republic Act No. 7353 which prohibited the transfer of
rural bank shares to individuals who were not Philippine citizens or
declared such transfer void, is both erroneous and unfounded.
Campos
Umps
Tecson
Mole
The Court ruled that these contracts were void not because of intrinsic
the case at hand, the same is true. The contract was not illegal per se
that the project manager was not authorized to represent the former as
signatory in the contract. The RTC ruled in favor of the contractors,
whcih was sustained by the CA.
The issue in this case is whether there is a valid contract between the
DPWH and the contractors which would merit the approval of the
money claim by the contractors.
The Court ruled that indeed, the contract between the DPWH and the
contractors lacked the necessary element for it to be valid. There was
indeed a prior appropriation under the Mt. Pinatubo Rehabilitation
Project, but the second element was not present, for there was no
certification of the availability of funds from the accountant of the
agency. Furthermore, the project manager had no authority to sign in
behalf of the agency for contracts amounting to more than a million
pesos. Therefore, the contract was indeed void from its inception.
However, such would not free the DPWH from paying the contractors.
It has been established that the contractors had rendered dredging
services which would entitle them to remuneration on the basis of
equity. This was the ruling of the Court in the case of Royal Trust
Landbank
Dem
Borromeo
Gutierrez
Estoppel
Lim
Republic
Hermosilla
ASILO JR VS BOMBASI
Sometime in 1978 the municipality of Nagcarlan,Laguna through then
Mayor Comendador and Bombasis mother entered into a lease
contract whereby it allowed respondents mother to occupy a particular
space in the Laguna Public market for a period of 20 years. But on
1984 Marciana died before the expiration of the contract so Visitacion
Bombasi took over the said store and then From then on up to January
1993, Visitacion secured the yearly Mayors permits. Sometime in
1986 a fire razed the public market but the store of Bombas was not
affected. Upon Visitacions request for inspection on 15 May 1986,
District Engineer Marcelino B. Gorospe (Engineer Gorospe) of the
then Ministry of Public Works and Highways, Regional Office No. IVA, found that the store of Visitacion remained intact and stood strong.
This finding of Engineer Gorospe was contested by the Municipality
of Nagcarlan. On 1993 Bombasi received a letter from Mayor
Comendador directing her to demolish her store. Said action was based
on a resolution passed by the Nagcarlans Sangguniang Bayan. The
resolution empowered Mayor comendador to file a case for unlawful
detainer against Bombasi in case the latter should refuse to vacate or
demolish the store to give way to the construction of the new public
market. Bombasi on the reply stood her ground alleging that she
cannot be evicted from the said space since the contract between them
and the municipality is still existing and that the building where she
engages business has not been affected by the fire as to consider it a
public nuisance or hazard and lastly, that the said resolution does not
authorize the Mayor to demolish the said building without first filing a
case for unlawful detainer. Notwithstanding the allegations of
Bombasi, Comendador with the assistance of Asilo,Jr , demolished the
said building.
Bombasi then filed a criminal action for violation of Republic Act
3019 otherwise known as anti-graft and corrupt practices act.
Petitioner Asilo and Comendador were found guilty of the said
violation. It then appealed the conviction raising as a defense the fact