Professional Documents
Culture Documents
Brothers Realty Company vs. Court of Appeals, Luis Aying, Demetrio Sida, Felomino Augusto, Federico Abing, and Romeo Augusto
Brothers Realty Company vs. Court of Appeals, Luis Aying, Demetrio Sida, Felomino Augusto, Federico Abing, and Romeo Augusto
sent out notices to vacate, addressed to persons occupying the property. Unheeded,
petitioner then filed a complaint for ejectment against the occupants before the
[G.R. No. 144773. May 16, 2005 Metropolitan Trial Court (MTC), Lapu-Lapu City.
On February 1, 1994, the MTC ordered the occupants to vacate the property.
The case eventually reached this Court, docketed as G.R. No. 128102, entitled Aznar
]AZNAR BROTHERS REALTY COMPANY, petitioner, vs. LAURENCIO AYING, IN HIS Brothers Realty Company vs. Court of Appeals, Luis Aying, Demetrio Sida, Felomino
OWN BEHALF AND IN BEHALF OF THE OTHER HEIRS OF EMILIANO AYING, PAULINO Augusto, Federico Abing, and Romeo Augusto.[2] On March 7, 2000, a Decision was
AYING, IN HIS OWN BEHALF AND IN BEHALF OF THE OTHER HEIRS OF SIMEON promulgated in favor of herein petitioner, declaring it as the rightful possessor of the
AYING, AND WENCESLAO SUMALINOG, IN HIS OWN BEHALF AND IN BEHALF OF THE parcel of land in question.
OTHER HEIRS OF ROBERTA AYING, respondents. Meanwhile, herein respondents, along with other persons claiming to be
descendants of the eight Aying siblings, all in all numbering around 220 persons, had
filed a complaint for cancellation of the Extra-Judicial Partition with Absolute Sale,
recovery of ownership, injunction and damages with the RTC of Lapu-Lapu City. The
DECISION complaint was dismissed twice without prejudice. Said complaint was re-filed on
AUSTRIA-MARTINEZ, J.: August 19, 1993, docketed as Civil Case No. 2930-L.
In their amended complaint, herein respondents (plaintiffs before the RTC)
This resolves the petition for review on certiorari seeking the modification of the alleged that: they are co-owners of subject property, being descendants of the
Decision[1] of the Court of Appeals (CA) dated March 7, 2000 which affirmed with registered owners thereof under OCT No. RO-2856; they had been in actual, peaceful,
modification the Decision of the Regional Trial Court (RTC) of Lapu-Lapu City, Branch physical, open, adverse, continuous and uninterrupted possession in concept of
27 in Civil Case No. 2930-L; and the Resolution dated August 2, 2000 denying owner of subject parcel of land since time immemorial; their possession was
petitioners motion for reconsideration of the aforementioned decision. disturbed only in the last quarter of 1991 when some of them received notices to
vacate from petitioner and several weeks thereafter, earthmoving equipment entered
The antecedent facts are as follows:
the disputed land, bulldozing the same and destroying plants, trees and concrete
The disputed property is Lot No. 4399 with an area of 34,325 square meters monuments (mohon); respondents discovered that such activities were being
located at Dapdap, Lapu-Lapu City. Crisanta Maloloy-on petitioned for the issuance of undertaken by petitioner together with Sta. Lucia Realty and Development, Inc.;
a cadastral decree in her favor over said parcel of land. After her death in 1930, the petitioner claimed to be the owner of subject property by virtue of an extra-judicial
Cadastral Court issued a Decision directing the issuance of a decree in the name of partition of real estate with deed of absolute sale executed in petitioners favor by the
Crisanta Maloloy-ons eight children, namely: Juan, Celedonio, Emiliano, Francisco, alleged heirs of Crisanta Maloloy-on; the aforementioned extra-judicial partition of
Simeon, Bernabe, Roberta and Fausta, all surnamed Aying. The certificate of title was, real estate with deed of absolute sale is a fraud and is null and void ab initio because
however, lost during the war. not all the co-owners of subject property affixed their signature on said document and
some of the co-owners who supposedly signed said document had been dead at the
Subsequently, all the heirs of the Aying siblings executed an Extra-Judicial time of the execution thereof; petitioner entered subject land in bad faith, knowing
Partition of Real Estate with Deed of Absolute Sale dated March 3, 1964, conveying fully well that it did not have any right to the land and used force, threat and
the subject parcel of land to herein petitioner Aznar Brothers Realty Company. Said intimidation against respondents; and they suffered moral damages. [3]
deed was registered with the Register of Deeds of Lapu-Lapu City on March 6, 1964
under Act No. 3344 (the law governing registration for unregistered land), and since Petitioner (defendant before the RTC) filed its Answer, denying that respondents
then, petitioner had been religiously paying real property taxes on said property. are the lawful owners of subject parcel of land by virtue of their being descendants or
heirs of the registered owners of subject property. Instead, petitioner alleged that it
In 1988, herein petitioner filed a Petition for Reconstitution of the Original Title had been in actual possession of subject land as owner thereof by virtue of the extra-
as the original title over the subject property had been lost during the war. On April judicial partition of real property and deed of absolute sale executed in its favor; that
12, 1988, the court granted said petition, thereby directing the Register of Deeds of in fact, it had been paying taxes thereon religiously; that it tolerated about 6 persons
Lapu-Lapu City to issue a reconstituted title in the name of the abovementioned Aying to live on said land but said persons were eventually ejected by court order. Petitioner
siblings. Thus, Original Certificate of Title (OCT) No. RO-2856 was issued. then raised the affirmative defenses of failure to state cause of action and
prescription, as it took respondents 27 years, 10 months and 27 days to file the action
to recover subject property, when an action to recover property based on an implied and to issue a transfer certificate of title in the name of Aznar Brothers Realty
trust should be instituted within 4 years from discovery of the fraud. [4] Company upon payment of the necessary registration fees pursuant thereto.
In the Pre-Trial Order dated January 30, 1995 of the RTC, the issues were
The Writ of Preliminary Injunction issued in this case is hereby ordered dissolved.
narrowed down to the following:
The Motion for Contempt filed by the plaintiffs against defendants is dismissed for
1. Whether or not the plaintiffs [herein respondents] are the heirs of the registered
want of factual and legal basis.
owners of Lot No. 4399.
SO ORDERED.[6]
3. Whether or not the defendant Aznar [herein petitioner] is estopped to make any
claim on Lot No. 4399.
Herein respondents appealed the foregoing decision to the CA and on March 7,
2000, said court promulgated its Decision, the dispositive portion of which is
4. Whether or not the defendant Aznar is a builder in bad faith.
reproduced hereunder:
5. Whether or not the defendants are liable for damages and attorneys fees in favor
THE FOREGOING CONSIDERED, the contested Decision while AFFIRMED is hereby
of the plaintiffs.
MODIFIED. The heirs of Emiliano Aying, Simeon Aying and Roberta Aying are hereby
declared as the lawful owners of the contested property but equivalent only to 3/8.
6. Whether or not the Extra-Judicial Partition of Real Estate with Deed of Absolute
Sale is valid and had, in effect, validly conveyed to defendant Aznar Lot No. 4399.
SO ORDERED.
7. Whether or not the plaintiffs action has prescribed.[5]
In modifying the RTC judgment, the CA ratiocinated that an action for recovery
of possession of registered land never prescribes in view of the provision of Section
After trial, the RTC rendered a Decision dated July 4, 1997, ruling that
44, Act No. 496 (now Sec. 47, PD 1520), to the effect that no title to registered land in
respondents evidence failed to prove that the extra-judicial partition with deed of
derogation to that of a registered owner shall be acquired by prescription. The CA
absolute sale was a totally simulated or fictitious contract and concluded that said further ruled that even if the action is deemed to be based on implied trust,
document is valid, thus, effectively conveying to petitioner the property in question. It
prescription did not begin to run since there is no evidence that positive acts of
further held that respondents action had prescribed in that the action is considered as
repudiation were made known to the heirs who did not participate in the execution of
one for reconveyance based on implied or constructive trust, it prescribed in 10 years
the Extra-Judicial Partition of Real Estate with Deed of Absolute Sale. Thus, striking
from the registration of the deed on March 6, 1964; and if the action is considered as down the RTCs ruling that the respondents complaint is dismissible on the ground of
one for annulment of contract on the ground of fraud, it should have been filed within
prescription, the CA held instead that herein respondents action had not prescribed
4 years from discovery of the fraud. The trial court also ruled that respondents failed
but upheld the validity of the Extra-Judicial Partition of Real Estate with Deed of
to present any admissible proof of filiation, hence, they were not able to prove that Absolute Sale, except as to the shares of the heirs of Emiliano, Simeon and Roberta,
they are indeed heirs of the eight Aying siblings who appear as the registered owners
who did not participate in the execution of said document.
under OCT No. RO-2856.
Herein petitioners motion for reconsideration of the CA decision was denied per
The dispositive portion of the RTC Decision reads as follows:
Resolution dated August 2, 2000.
WHEREFORE, judgment is hereby rendered dismissing the amended complaint on the Hence, the present petition for review on certiorari assailing the CA decision on
ground of prescription, and declaring the Extra-Judicial Partition of Real Estate with the following grounds:
Deed of Absolute Sale dated March 3, 1964 as valid and binding, adjudging that Lot
I
4399 with an area of 34,325 square meters located at Dapdap, Mactan, Lapu-Lapu
City had been validly conveyed to and in favor of Aznar Brothers Realty Company, and
directing the Register of Deeds of Lapu-Lapu City to register the above-mentioned
deed in accordance with law and to cancel Original Certificate of Title No. RO-2856,
THE COURT OF APPEALS ERRED IN FAILING TO APPLY THE RULE THAT AN HEIR OF THE Respondents alleged in their amended complaint that not all the co-owners of
ORIGINAL REGISTERED OWNER MAY LOSE HIS RIGHT TO RECOVER A TITLED PROPERTY the land in question signed or executed the document conveying ownership thereof
BY REASON OF LACHES; to petitioner and made the conclusion that said document is null and void. We agree
with the ruling of the RTC and the CA that the Extra-Judicial Partition of Real Estate
II with Deed of Absolute Sale is valid and binding only as to the heirs who participated in
the execution thereof, hence, the heirs of Emiliano, Simeon and Roberta Aying, who
THE COURT OF APPEALS ERRED IN FAILING TO APPLY THE RULE THAT THE ACT OF undisputedly did not participate therein, cannot be bound by said document.
REGISTRATION OF THE DEED OF PARTITION WITH SALE MAY BE CONSIDERED AN However, the facts on record show that petitioner acquired the entire parcel of
UNEQUIVOCAL REPUDIATION OF THE TRUST GIVING RISE TO PRESCRIPTION; land with the mistaken belief that all the heirs have executed the subject document.
Thus, the trial court is correct that the provision of law applicable to this case is Article
III 1456 of the Civil Code which states:
THE COURT OF APPEALS ERRED IN FAILING TO APPLY THE PROVISIONS OF ARTICLE ART. 1456. If property is acquired through mistake or fraud, the person obtaining it is,
1104 OF THE CIVIL CODE TO THE EFFECT THAT IN THE ABSENCE OF BAD FAITH OR by force of law, considered a trustee of an implied trust for the benefit of the person
FRAUD, THE PARTITION WITH PRETERITION OF ANY COMPULSORY HEIR SHALL NOT BE from whom the property comes.
RESCINDED.[7]
In Vda. De Esconde vs. Court of Appeals,[8] the Court expounded thus:
In their Comment, respondents argue that this case is an action to declare as null
and void the Extra-Judicial Partition of Real Estate with Deed of Absolute Sale, hence, Construing this provision of the Civil Code, in Philippine National Bank v. Court of
under Article 1410 of the Civil Code, an action for declaration of an inexistent contract Appeals, the Court stated:
does not prescribe. Respondents further posit that the principle of laches should be
applied against petitioner and not against them, as they (respondents) had been in
A deeper analysis of Article 1456 reveals that it is not a trust in the technical sense for
actual possession of the subject property, while petitioner merely brought action to
in a typical trust, confidence is reposed in one person who is named a trustee for the
eject them more than 29 years after the alleged execution of the Extra-Judicial
benefit of another who is called the cestui que trust, respecting property which is held
Partition of Real Estate with Deed of Absolute Sale. They also refuted petitioners
by the trustee for the benefit of the cestui que trust. A constructive trust, unlike an
arguments regarding the application of the principles of implied and constructive
express trust, does not emanate from, or generate a fiduciary relation. While in an
trusts in this case.
express trust, a beneficiary and a trustee are linked by confidential or fiduciary
At the outset, it should be stressed that not all the plaintiffs who filed the relations, in a constructive trust, there is neither a promise nor any fiduciary relation
amended complaint before the trial court had been impleaded as respondents in the to speak of and the so-called trustee neither accepts any trust nor intends holding the
present petition. The only parties impleaded are the heirs of Emiliano, Simeon and property for the beneficiary.[9]
Roberta Aying, whom the CA adjudged as owners of a 3/8 portion of the land in
dispute for not having participated in the execution of the Extra-Judicial Partition of The concept of constructive trusts was further elucidated in the same case, as
Real Estate with Deed of Absolute Sale. follows:
It is significant to note that herein petitioner does not question the CA
. . . implied trusts are those which, without being expressed, are deducible from the
conclusion that respondents are heirs of the aforementioned three Aying siblings.
nature of the transaction as matters of intent or which are superinduced on the
Hence, the trial court and appellate courts findings that the Extra- Judicial Partition of
transaction by operation of law as matters of equity, independently of the particular
Real Estate with Deed of Absolute Sale was not forged nor simulated and that the
intention of the parties. In turn, implied trusts are either resulting or constructive
heirs of Emiliano, Simeon and Roberta Aying did not participate in the execution
trusts. These two are differentiated from each other as follows:
thereof, are now beyond cavil.
The issues raised by petitioner for the Courts resolution are (1) whether or not Resulting trusts are based on the equitable doctrine that valuable consideration and
respondents cause of action is imprescriptible; and (2) if their right to bring action is not legal title determines the equitable title or interest and are presumed always to
indeed imprescriptible, may the principle of laches apply. have been contemplated by the parties. They arise from the nature of circumstances
of the consideration involved in a transaction whereby one person thereby becomes
invested with legal title but is obligated in equity to hold his legal title for the benefit
of another. On the other hand, constructive trusts are created by the construction of possession of the property, the right to seek reconveyance, which in effect seeks to
equity in order to satisfy the demands of justice and prevent unjust enrichment. They quiet title to the property, does not prescribe.[14]
arise contrary to intention against one who, by fraud, duress or abuse of confidence,
In the present case, respondents Wenceslao Sumalinog, an heir of Roberta
obtains or holds the legal right to property which he ought not, in equity and good
Aying; Laurencio Aying, an heir of Emiliano Aying; and Paulino Aying, an heir of
conscience, to hold.[10] (Emphasis supplied)
Simeon Aying, all testified that they had never occupied or been in possession of the
land in dispute.[15] Hence, the prescriptive period of ten years would apply to herein
Based on such concept of constructive trusts, the Court ruled in said case that:
respondents.
The rule that a trustee cannot acquire by prescription ownership over property The question then arises as to the date from which the ten-year period should
entrusted to him until and unless he repudiates the trust, applies to express trusts and be reckoned, considering that the Extra-Judicial Partition of Real Estate with Deed of
resulting implied trusts. However, in constructive implied trusts, prescription may Absolute Sale was registered under Act No. 3344 and not under Act No. 496 (Land
supervene even if the trustee does not repudiate the relationship. Necessarily, Registration Act), despite the fact the land in dispute was already titled under Act No.
repudiation of said trust is not a condition precedent to the running of the 496 in the names of the Aying siblings at the time the subject document was
prescriptive period.[11] executed.
In Spouses Abrigo vs. De Vera,[16] it was held that registration of instruments
The next question is, what is the applicable prescriptive period? must be done in the proper registry, in order to affect and bind the land and, thus,
In Amerol vs. Bagumbaran,[12] the Court expounded on the prescriptive period operate as constructive notice to the world.[17] Therein, the Court ruled:
within which to bring an action for reconveyance of property based on implied or
constructive trust, to wit: x x x If the land is registered under the Land Registration Act (and has therefore a
Torrens Title), and it is sold but the subsequent sale is registered not under the Land
. . . under the present Civil Code, we find that just as an implied or constructive trust is Registration Act but under Act 3344, as amended, such sale is not considered
an offspring of the law (Art. 1456, Civil Code), so is the corresponding obligation to REGISTERED x x x .[18]
reconvey the property and the title thereto in favor of the true owner. In this context,
and vis--vis prescription, Article 1144 of the Civil Code is applicable. In this case, since the Extra-Judicial Partition of Real Estate with Deed of
Absolute Sale was registered under Act No. 3344 and not under Act No. 496, said
Article 1144. The following actions must be brought within ten years from the time document is deemed not registered. Accordingly, the ten-year prescriptive period
the right of action accrues: cannot be reckoned from March 6, 1964, the date of registration of the subject
document under Act No. 3344. The prescriptive period only began to run from the
time respondents had actual notice of the Extra-Judicial Partition of Real Estate with
(1) Upon a written contract;
Deed of Absolute Sale.
(2) Upon an obligation created by law;
(3) Upon a judgment. The only evidence on record as to when such prescriptive period commenced as
to each of the respondents are Wenceslao Sumalinogs (heir of Roberta Aying)
xxx xxx xxx testimony that about three years after 1964, they already learned of the existence of
the Extra-Judicial Partition of Real Estate with Deed of Absolute Sale;[19] and Laurencio
An action for reconveyance based on an implied or constructive trust must perforce Ayings (heir of Emiliano Aying) admission that he found out about the sale of the land
prescribe in ten years and not otherwise. A long line of decisions of this Court, and of in dispute a long time ago and can only estimate that it must be after martial
very recent vintage at that, illustrates this rule. Undoubtedly, it is now well-settled law.[20] Paulino Aying (heir of Simeon Aying) gave no testimony whatsoever as to when
that an action for reconveyance based on an implied or constructive trust prescribes the children of Simeon Aying actually learned of the existence of the document of
in ten years from the issuance of the Torrens title over the property. [13] sale. On the other hand, petitioner did not present any other evidence to prove the
date when respondents were notified of the execution of the subject document.
It has also been ruled that the ten-year prescriptive period begins to run from In view of the lack of unambiguous evidence of when the heirs of Emiliano Aying
the date of registration of the deed or the date of the issuance of the certificate of and Simeon Aying discovered the existence of the document of sale, it must be
title over the property, but if the person claiming to be the owner thereof is in actual determined which party had the burden of proof to establish such fact.
The test for determining where the burden of proof lies is to ask which party to having brought their action within the prescriptive period, are now entitled to the
an action or suit will fail if he offers no evidence competent to show the facts averred reconveyance of their share in the land in dispute.
as the basis for the relief he seeks to obtain.[21] Moreover, one alleging a fact that is
IN VIEW OF THE FOREGOING, the petition is PARTIALLY GRANTED and the
denied has the burden of proving it and unless the party asserting the affirmative of
Decision of the Court of Appeals dated March 7, 2000 is MODIFIED, as follows: The
an issue sustains the burden of proof of that issue by a preponderance of the
amended complaint of the heirs of Roberta Aying is DISMISSED on the ground of
evidence, his cause will not succeed.[22] Thus, the defendant bears the burden of proof
as to all affirmative defenses which he sets up in answer to the plaintiffs claim or prescription. However, the heirs of Emiliano Aying and Simeon Aying, having
instituted the action for reconveyance within the prescriptive period, are hereby
cause of action; he being the party who asserts the truth of the matter he has alleged,
DECLARED as the LAWFUL OWNERS of a 2/8 portion of the parcel of land covered by
the burden is upon him to establish the facts on which that matter is predicated and if
Original Certificate of Title No. RO-2856.
he fails to do so, the plaintiff is entitled to a verdict or decision in his favor. [23]
In the case at bar, it was petitioner, as the defendant before the RTC, which set SO ORDERED.
up in its Answer the affirmative defense of prescription. It was, therefore, incumbent Puno, (Chairman), Callejo, Sr., Tinga, and Chico-Nazario, JJ., concur.
upon petitioner to prove the date from which the prescriptive period began to run.
Evidence as to the date when the ten-year prescriptive period began exists only as to
the heirs of Roberta Aying, as Wenceslao Sumalinog admitted that they learned of the
existence of the document of sale in the year 1967. As to the heirs of Emiliano Aying
and Simeon Aying, there is no clear evidence of the date when they discovered the
document conveying the subject land to petitioner. Petitioner miserably failed to SECOND DIVISION
adduce proof of when the heirs of Emiliano Aying and Simeon Aying were notified of
the subject document. Hence, with regard to said heirs, the Court may consider the RICHARD B. LOPEZ, in his G.R. No. 157784
admission in the amended complaint that they learned of the conveyance of the Capacity as Trustee of the Trust
disputed land only in 1991 when petitioner sent notices to vacate to the occupants of Estate of the late Juliana Lopez-
the subject land, as the date from which the ten-year prescriptive period should be Manzano, Present:
reckoned. Petitioner,
Respondents filed their Amended Complaint on December 6, 1993. [24] Thus, with QUISUMBING, J.,
regard to respondent heirs of Roberta Aying who had knowledge of the conveyance as Chairperson,
far back as 1967, their cause of action is already barred by prescription when said CARPIO MORALES,
amended complaint was filed as they only had until 1977 within which to bring action. - versus - TINGA,
As to the respondent heirs of Emiliano and Simeon Aying, they were able to initiate VELASCO, JR., and
their action for reconveyance of property based on implied or constructive trust well COURT OF APPEALS, BRION, JJ.
within the ten-year prescriptive period reckoned from 1991 when they were sent by CORAZON LOPEZ, FERNANDO
petitioner a notice to vacate the subject property. LOPEZ, ROBERTO LOPEZ, represented
Evidently, laches cannot be applied against respondent heirs of Emiliano and by LUZVIMINDA LOPEZ, MARIA Promulgated:
Simeon Aying, as they took action to protect their interest well within the period ROLINDA MANZANO, MARIA
accorded them by law. ROSARIO MANZANO SANTOS,
JOSE MANZANO, JR., NARCISO
With regard to petitioners argument that the provision of Article 1104 of the MANZANO (all represented by December 16, 2008
Civil Code, stating that a partition made with preterition of any of the compulsory Attorney-in-fact, MODESTO RUBIO),
heirs shall not be rescinded, should be applied, suffice it to say that the Extra-Judicial MARIA CRISTINA MANZANO RUBIO,
Partition of Real Estate with Deed of Absolute Sale is not being rescinded. In fact, its IRENE MONZON and ELENA MANZANO,
validity had been upheld but only as to the parties who participated in the execution Respondents.
of the same. As discussed above, what was conveyed to petitioner was ownership x--------------------------------------------------------------------------------x
over the shares of the heirs who executed the subject document. Thus, the law,
particularly, Article 1456 of the Civil Code, imposed the obligation upon petitioner to DECISION
act as a trustee for the benefit of respondent heirs of Emiliano and Simeon Aying who, TINGA, J.:
were secured by real estate mortgages. He noted that if these debts were liquidated,
This is a petition for review on certiorari [1]under Rule 45 of the 1997 Rules of Civil the residuary estate available for distribution would, value-wise, be very small.
Procedure, assailing the Decision[2] and Resolution[3] of the Court of Appeals in CA-G.R.
CV No. 34086. The Court of Appeals decision affirmed the summary judgment of the From these premises, Jose proceeded to offer a project of partition. The relevant
Regional Trial Court (RTC), Branch 10, Balayan, Batangas, dismissing petitioners action portion pertaining to the Fideicomiso stated, thus:
for reconveyance on the ground of prescription.
PROJECT OF PARTITION
The instant petition stemmed from an action for reconveyance instituted by
petitioner Richard B. Lopez in his capacity as trustee of the estate of the late Juliana 14. Pursuant to the terms of the Will, one-half (1/2) of the following
Lopez Manzano (Juliana) to recover from respondents several large tracts of lands properties, which are not burdened with any obligation, shall be
allegedly belonging to the trust estate of Juliana. constituted into the Fidei-comiso de Juliana Lopez Manzano and
delivered to Jose Lopez Manzano as trustee thereof:
The decedent, Juliana, was married to Jose Lopez Manzano (Jose). Their
union did not bear any children. Juliana was the owner of several properties, among Location Title No. Area (Sq. M.) Improvements
them, the properties subject of this dispute. The disputed properties totaling more
than 1,500 hectares consist of six parcels of land, which are all located in Batangas. Abra de Ilog, TCT - 540 2,940,000 pasture, etc.
They were the exclusive paraphernal properties of Juliana together with a parcel of Mindoro
land situated in Mindoro known as Abra de Ilog and a fractional interest in a
residential land on Antorcha St., Balayan, Batangas. Antorcha St. TCT 1217-A 13,040 residential
Balayan, Batangas (1/6 thereof)
On 23 March 1968, Juliana executed a notarial will,[4] whereby she expressed that she
wished to constitute a trust fund for her paraphernal properties, denominated and all those properties to be inherited by the decedent, by
as Fideicomiso de Juliana Lopez Manzano (Fideicomiso), to be administered by her intestacy, from her sister, Clemencia Lopez y Castelo.
husband. If her husband were to die or renounce the obligation, her nephew, Enrique
Lopez, was to become administrator and executor of the Fideicomiso. Two-thirds (2/3) 15. The other half (1/2) of the aforesaid properties is adjudicated to
of the income from rentals over these properties were to answer for the education of Jose Lopez Manzano as heir.
deserving but needy honor students, while one-third 1/3 was to shoulder the
expenses and fees of the administrator. As to her conjugal properties, Juliana Then, Jose listed those properties which he alleged were registered in both his and
bequeathed the portion that she could legally dispose to her husband, and after his Julianas names, totaling 13 parcels in all. The disputed properties consisting of six (6)
death, said properties were to pass to her biznietos or great grandchildren. parcels, all located in Balayan, Batangas, were included in said list. These properties,
as described in the project of partition, are as follows:
Juliana initiated the probate of her will five (5) days after its execution, but she died Location Title No. Area (Sq. M.) Improvements
on 12 August 1968, before the petition for probate could be heard. The petition was
pursued instead in Special Proceedings (S.P.) No. 706 by her husband, Jose, who was Pantay, Calaca, 91,283 coconuts
the designated executor in the will. On 7 October 1968, the Court of First Instance, Batangas
Branch 3, Balayan, Batangas, acting as probate court, admitted the will to probate and
issued the letters testamentary to Jose. Jose then submitted an inventory of Julianas Mataywanak, OCT-29[6]94 485,486 sugar
real and personal properties with their appraised values, which was approved by the Tuy, Batangas
probate court.
Patugo, Balayan, OCT-2807 16,757,615 coconut,
Thereafter, Jose filed a Report dated 16 August 1969, which included a proposed Batangas sugar, citrus,
project of partition. In the report, Jose explained that as the only compulsory heir of pasteur
Juliana, he was entitled by operation of law to one-half (1/2) of
Julianas paraphernal properties as his legitime, while the other one-half (1/2) was to Cagayan, Balayan, TCT-1220 411,331 sugar
be constituted into the Fideicomiso. At the same time, Jose alleged that he and Juliana Batangas
had outstanding debts totaling P816,000.00 excluding interests, and that these debts
Pook, Baayan TCT-1281 135,922 sugar sister, Clemencia, in accordance with the order of the probate court in S.P. No. 706.
Batangas The disputed lands were excluded from the trust.
Bolbok, Balayan, TCT-18845 444,998 sugar Jose died on 22 July 1980, leaving a holographic will disposing of the disputed
Batangas properties to respondents. The will was allowed probate on 20 December 1983 in S.P.
Calzada, Balayan, TCT 1978 2,312 sugar No. 2675 before the RTC of Pasay City. Pursuant to Joses will, the RTC ordered on 20
Batangas December 1983 the transfer of the disputed properties to the respondents as the
Gumamela, Balayan, TCT-2575 829 heirs of Jose. Consequently, the certificates of title of the disputed properties were
Batangas cancelled and new ones issued in the names of respondents.
Bombon, Balayan, 4,532
Batangas Petitioners father, Enrique Lopez, also assumed the trusteeship of Julianas
Paraaque, Rizal TCT-282340 800 residential estate. On 30 August 1984, the RTC of Batangas, Branch 9 appointed petitioner as
Paraaque, Rizal TCT-11577 800 residential trustee of Julianas estate in S.P. No. 706. On 11 December 1984, petitioner instituted
Modesto St., Manila TCT-52212 137.8 residential an action for reconveyance of parcels of land with sum of money before the RTC
of Balayan, Batangasagainst respondents. The complaint[5] essentially alleged that
and the existing sugar quota in the name of the deceased with the Jose was able to register in his name the disputed properties, which were
Central Azucarera Don Pedro at Nasugbo. the paraphernal properties of Juliana, either during their conjugal union or in the
course of the performance of his duties as executor of the testate estate of Juliana
16. The remaining shall likewise go to Jose Lopez Manzano, with the and that upon the death of Jose, the disputed properties were included in the
condition to be annotated on the titles thereof, that upon his death, inventory as if they formed part of Joses estate when in fact Jose was holding them
the same shall pass on to Corazon Lopez, Ferdinand Lopez, and only in trust for the trust estate of Juliana.
Roberto Lopez:
Respondents Maria Rolinda Manzano, Maria Rosario Santos, Jose Manzano,
Location Title No. Area (Sq. M.) Improvements Jr., Narciso Manzano, Maria Cristina Manzano Rubio and Irene Monzon filed a joint
answer[6] with counterclaim for damages. Respondents Corazon, Fernando and
Dalig, Balayan, TCT-10080 482,872 sugar Roberto, all surnamed Lopez, who were minors at that time and represented by their
Batangas mother, filed a motion to dismiss,[7] the resolution of which was deferred until trial on
San Juan, Rizal TCT-53690 523 residential the merits. The RTC scheduled several pre-trial conferences and ordered the parties to
submit pre-trial briefs and copies of the exhibits.
On 25 August 1969, the probate court issued an order approving the project of
partition. As to the properties to be constituted into the Fideicomiso, the probate On 10 September 1990, the RTC rendered a summary judgment, [8] dismissing the
court ordered that the certificates of title thereto be cancelled, and, in lieu thereof, action on the ground of prescription of action. The RTC also denied respondents
new certificates be issued in favor of Jose as trustee of the Fideicomiso covering one- motion to set date of hearing on the counterclaim.
half (1/2) of the properties listed under paragraph 14 of the project of partition; and
regarding the other half, to be registered in the name of Jose as heir of Juliana. The Both petitioner and respondents elevated the matter to the Court of Appeals. On 18
properties which Jose had alleged as registered in his and Julianas names, including October 2002, the Court of Appeals rendered the assailed decision denying the
the disputed lots, were adjudicated to Jose as heir, subject to the condition that Jose appeals filed by both petitioner and respondents. The Court of Appeals also denied
would settle the obligations charged on these properties. The probate court, thus, petitioners motion for reconsideration for lack of merit in its Resolution dated 3 April
directed that new certificates of title be issued in favor of Jose as the registered 2003.
owner thereof in its Order dated 15 September 1969. On even date, the certificates of Hence, the instant petition attributing the following errors to the Court of Appeals:
title of the disputed properties were issued in the name of Jose.
I. THE COURT OF APPEALS CONCLUSION THAT PETITIONERS
The Fideicomiso was constituted in S.P No. 706 encompassing one-half (1/2) of ACTION FOR [RECONVEYANCE] HAS PRESCRIBED TAKING AS
the Abra de Ilog lot on Mindoro, the 1/6 portion of the lot in Antorcha St. BASIS SEPTEMBER 15, 1969 WHEN THE PROPERTIES IN DISPUTE
in Balayan, Batangasand all other properties inherited ab intestato by Juliana from her WERE TRANSFERRED TO THE NAME OF THE LATE JOSE LOPEZ
MANZANO IN RELATION TO DECEMBER 12, 1984 WHEN THE ACTION are superinduced on the transaction by operation of law as matters of equity,
FOR RECONVEYANCE WAS FILED IS ERRONEOUS. independently of the particular intention of the parties. [14]
II. THE RESPONDENT COURT OF APPEALS CONCLUSION IN The provision on implied trust governing the factual milieu of this case is
FINDING THAT THE FIDUCIARY RELATION ASSUMED BY THE LATE provided in Article 1456 of the Civil Code, which states:
JOSE LOPEZ MANZANO, AS TRUSTEE, PURSUANT TO THE LAST WILL
AND TESTAMENT OF JULIANA LOPEZ MANZANO WAS IMPLIED ART. 1456. If property is acquired through mistake or fraud, the
TRUST, INSTEAD OF EXPRESS TRUST IS EQUALLY ERRONEOUS. 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
None of the respondents filed a comment on the petition. The counsel for comes.
respondents Corazon, Fernando and Roberto, all surnamed Lopez, explained that he
learned that respondents had migrated to the United States only when the case was In Aznar Brothers Realty Company v. Aying,[15] the Court differentiated two
pending before the Court of Appeals.[9] Counsel for the rest of the respondents kinds of implied trusts, to wit:
likewise manifested that the failure by said respondents to contact or communicate
with him possibly signified their lack of interest in the case. [10] In a Resolution dated 19 x x x In turn, implied trusts are either resulting or
September 2005, the Court dispensed with the filing of a comment and considered constructive trusts. These two are differentiated from each other as
the case submitted for decision.[11] follows:
In the instant case, the ten-year prescriptive period to recover the disputed
property must be counted from its registration in the name of Jose on 15 September CONCEPCION ROJAS, Promulgated:
1969, when petitioner was charged with constructive notice that Jose adjudicated the Respondent.
disputed properties to himself as the sole heir of Juana and not as trustee of November 23, 2007
the Fideicomiso.
It should be pointed out also that Jose had already indicated at the outset
that the disputed properties did not form part of the Fideicomiso contrary to
petitioners claim that no overt acts of repudiation may be attributed to Jose. It may
not be amiss to state that in the project of partition submitted to the probate court,
Jose had indicated that the disputed properties were conjugal in nature and, thus, x-----------------------------------------------------------------------------------------x
excluded from Julianas Fideicomiso. This act is clearly tantamount to repudiating the
trust, at which point the period for prescription is reckoned. DECISION
NACHURA, J.:
paragraph 5 of the complaint and hereby orders defendant
Concepcion Rojas:
This is a petition for review on certiorari from the Decision[1] of the Court of
Appeals, dated September 7, 2000, in CA-G.R. SP No. 53236, and Resolution a) To vacate and surrender possession of
dated May 9, 2001. the land to
plaintiff;
b) To pay plaintiff the sum of P34,000.00
actual
On January 29, 1997, petitioner Soledad Caezo filed a Complaint[2] for the damages, P10,000.00 for attorneys fees
recovery of real property plus damages with the Municipal Trial Court (MTC) of Naval, and litigation expenses; and
Biliran, against her fathers second wife, respondent Concepcion Rojas. The subject c) To pay the costs.
property is an unregistered land with an area of 4,169 square meters, situated at
Higatangan, Naval, Biliran. Caezo attached to the complaint a Joint SO ORDERED.[7]
Affidavit[3] executed on May 10, 1979 by Isidro Catandijan and Maximina Caezo
attesting to her acquisition of theproperty.
Despite the respondents objection that the verbal sale cannot be proven without
In her complaint, the petitioner alleged that she bought the parcel of land in infringing the Statute of Frauds, the MTC gave credence to the testimony of the
1939 from Crisogono Limpiado, although the transaction was not reduced into petitioners two witnesses attesting to the fact that Crisogono Limpiado sold the
writing. Thereafter, she immediately took possession of the property. When she and property to the petitioner in 1939. The MTC also found no evidence to show that
her husband left for Mindanao in 1948, she entrusted the said land to her father, Crispulo Rojas bought the property from Crisogono Limpiado in 1948. It held that the
Crispulo[4] Rojas, who took possession of, and cultivated, the property. In 1980, she 1948 tax declaration in Crispulos name had little significance on respondents claim,
found out that the respondent, her stepmother, was in possession of the property considering that in 1948, the country was then rehabilitating itself from the ravages of
and was cultivating the same. She also discovered that the tax declaration over the the Second World War and the government was more interested in the increase in tax
property was already in the name of Crispulo Rojas.[5] collection than the observance of the niceties of law.[8]
In her Answer, the respondent asserted that, contrary to the petitioners claim, it was The respondent appealed the case to the Regional Trial Court (RTC) of Naval,
her husband, Crispulo Rojas, who bought the property from Crisogono Limpiado in Biliran. On October 12, 1998, the RTC reversed the MTC decision on the ground that
1948, which accounts for the tax declaration being in Crispulos name. From then on, the action had already prescribed and acquisitive prescription had set in. The
until his death in 1978, Crispulo possessed and cultivated the property. Upon his dispositive portion of the Decision reads:
death, the property was included in his estate, which was administered by a special
administrator, Bienvenido Ricafort. The petitioner, as heir, even received her share in WHEREFORE, premises considered, the decision of the Municipal
the produce of the estate. The respondent further contended that the petitioner Trial Court of Naval, Biliran awarding ownership of the disputed land
ought to have impleaded all of the heirs as defendants. She also argued that the fact to the plaintiff and further allowing recovery of damages is hereby
that petitioner filed the complaint only in 1997 means that she had already REVERSED in toto. There is no award of damages.
abandoned her right over the property.[6]
The said property remains as the legitime of the defendant
On July 3, 1998, after hearing, the MTC rendered a Decision in favor of the petitioner, Concepcion Rojas and her children.
thus:
SO ORDERED.[9]
SO ORDERED.[11]
That the Court of Appeals committed grave abuse of
discretion in setting aside petitioners contention that the Petition
The respondent filed a motion to reconsider the Amended Decision but the for Review filed by respondent CONCEPCION ROJAS before the
RTC denied the same in an Order dated April 25, 1999. Court of Appeals was FILED OUT OF TIME;
The sole issue that the Court has to resolve is whether or not petitioners recovering what has been fraudulently registered in the name of another. [29] The
cause of action has prescribed. equitable remedy of laches is, therefore, unavailing in this case.
The Court of Appeals erred in applying the rules on prescription and the However, to recover the other half of the property covered by the
principle of laches because what is involved in the present case is an express trust. private Calig-onan sa Panagpalit and to have it registered on the title of the property,
petitioners should have filed an action to compel[30] respondents, as heirs of the
Trust is the right to the beneficial enjoyment of property, the legal title to sellers in the contract,[31] to execute a public deed of sale. A conveyance of land made
which is vested in another. It is a fiduciary relationship that obliges the trustee to deal in a private document does not affect its validity. Article 1358,like its forerunner
with the property for the benefit of the beneficiary.[23] Trust relations between parties Article 1280 of the Civil Code of Spain, does not require the accomplishment of the
may either be express or implied. An express trust is created by the intention of the acts or
trustor or of the parties. An implied trust comes into being by operation of law.[24] contracts in a public instrument in order to validate the act or contract but only to
insure its efficacy,[32] so that after the existence of said contract has been admitted,
Express trusts are created by direct and positive acts of the parties, by some the party bound may be compelled to execute the proper document. [33] But even
writing or deed, or will, or by words either expressly or impliedly evincing an intention assuming that such action was filed by petitioners, the same had already prescribed.
to create a trust.[25] Under Article 1444 of the Civil Code, "[n]o particular words are
required for the creation of an express trust, it being sufficient that a trust is clearly It is settled that only laws existing at the time of the execution of a contract
intended." The Affidavit of Epifanio is in the nature of a trust agreement. Epifanio are applicable thereto and not later statutes, unless the latter are specifically
affirmed that the lot brought in his name was co-owned by him, as one of the heirs of intended to have retroactive effect.[34] Consequently, it is the Old Code of Civil
Jose, and his uncle Tranquilino. And by agreement, each of them has been in Procedure (Act No. 190) which applies in this case since the Calig-onan sa
possession of half of the property. Their arrangement was corroborated by the Panagpalit was executed on 18 October 1939 while the New Civil Code took effect
subdivision plan prepared by Engr. Bunagan and approved by Jose P. Dans, Acting only on 30 August 1950. And section 43 of Act No. 190, like its counterpart Article
Director of Lands. 1144 of the New Civil Code, provides that action upon a written contract must be filed
within ten years.[35]
As such, prescription and laches will run only from the time the express trust
is repudiated. The Court has held that for acquisitive prescription to bar the action of
WHEREFORE, the petition is PARTIALLY GRANTED. The Decision of the Court of
the beneficiary against the trustee in an express trust for the recovery of the property
Appeals dated 30 June 2003 in CA-G.R. CV No. 65829 is REVERSED and SET ASIDE and
held in trust it must be shown that: (a) the trustee has performed unequivocal acts of
repudiation amounting to an ouster of the cestui que trust; (b) such positive acts of the Decision of the Regional Trial Court of Cebu City, Branch 9 dated 23 August 1999 is
repudiation have been made known to the cestui que trust, and (c) the evidence REINSTATED with MODIFICATION in petitioners are hereby DECLARED the absolute
thereon is clear and conclusive.[26] Respondents cannot rely on the fact that owners of one-half of Lot No. 1054 or Lot No. 1054-A under TCT No. RT-7853.The
the Torrens title was issued in the name of Epifanio and the other heirs of Jose. It has Register of Deeds of Cebu City is hereby ORDERED to CANCEL TCT No. RT-7853 in part
been held that a trustee who obtains a Torrens title over property held in trust by him and issue a new Transfer Certificate of Title to petitioners, heirs of Tranquilino Labiste,
for another cannot repudiate the trust by relying on the registration. [27] The rule covering Lot No. 1054-A. No costs.
requires a clear repudiation of the trust duly communicated to the beneficiary. The
SO ORDERED.