CELESTINO BALUS vs.

SATURNINO BALUS
G.R. No. 168970 ; January 15, 2010
Peralta, J.
FACTS:
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. 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). 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. A Certificate of Sale was later 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, the
sheriff executed a Definite Deed of Sale in the Banks favor.
Thereafter, a new title was issued in the name of the Bank. On
October 10, 1989, petitioner and respondents executed an
Extrajudicial Settlement of Estate adjudicating to each of them a
specific one-third portion of the subject property and 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.
Meanwhile, petitioner continued possession of the subject lot.
Respondents filed a Complaint for Recovery of Possession and
Damages against petitioner and RTC rendered a decision 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. 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. Respondents appealed to the CA. CA reversed
decision of RTC.

ISSUE:
Whether co-ownership between petitioner and respondents
persisted even after the lot was purchased by the Bank and even
after it was eventually bought by the Respondents from the Bank.
HELD:
NO. 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. 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.
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. A plain
reading of the provisions of the Extrajudicial Settlement would not,
in any way, support petitioners contention that it was his and his
siblings 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. 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.
Furthermore, petitioners 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.

In other words, the purpose of partition is to put an end to coownership, an objective which negates petitioners claims in the
present case.