4 G.R. No.

160488 September 3, 2004 RTC: rendered a decision holding that an implied trust existed between
FELOMINA ABELLANA, petitioner, Felomina and Lucila, such that the latter is merely holding the lot for the benefit
vs. of the former. It thus ordered the conveyance of the subject lot in favor of
SPOUSES ROMEO PONCE and LUCILA PONCE and the REGISTER OF Felomina.
DEEDS of BUTUAN CITY, respondents.
CA: set aside the decision that Felomina failed to prove the existence of an
FACTS: implied trust and upheld respondent spouses’ ownership over the litigated
lot. It further held that even assuming that Felomina paid the purchase
 On July 15, 1981, Felomina, a spinster, pharmacist and aunt of private price of the lot, the situation falls within the exception stated in Article
respondent Lucila Ponce, purchased from the late Estela Caldoza- 1448 of the Civil Code which raises a disputable presumption that the
Pacres a 44,297 sqm agricultural lot with the intention of giving property was purchased by Felomina as a gift to Lucila whom she
said lot to her niece, Lucila. considered as her own daughter.

 Thus, in the deed of sale, Lucila was designated as the buyer of Lot  Felomina filed a MR but it was denied. Hence, this petition.
3, covered by OCT No. P-27, Homestead Patent No. V-1551 located
at Los Angeles, Butuan City. The total consideration of the sale was ISSUES/RULING:
P16,500.00, but only P4,500.00 was stated upon the request of the
seller. 1. Who, as between Felomina and respondent spouses, is the lawful
owner of the controverted lot?
 Felomina applied for the issuance of title in the name of her niece. On
April 28, 1992, TCT No. 2874 over the subject lot was issued in the Felomina.
name of Lucila. Said title, however, remained in the possession
of Felomina who developed the lot through Juanario Torreon and paid We find that it was Felomina and not Lucila who truly purchased the questioned
real property taxes thereon. lot from Estela. The positive and consistent testimony of Felomina alone, that
she was the real vendee of the lot, is credible to debunk the contrary claim of
 The relationship between Felomina and respondent spouses respondent spouses. Indeed, the lone testimony of a witness, if credible, is
Romeo and Lucila, however, turned sour. The latter allegedly sufficient as in the present case.
became disrespectful and ungrateful to the point of hurling her insults
and even attempting to hurt her physically. Hence, Felomina filed the o Moreover, Aquilino Caldoza, brother of the vendor and one of the
instant case for revocation of implied trust to recover legal title over witnesses to the deed of sale, categorically declared that Felomina
the property. was the buyer and the one who paid the purchase price to her
sister, Estela.
o Then too, Juanario, who was allegedly hired by Lucila to develop
 Private respondent spouses claimed that the purchase price of the lot
the lot, vehemently denied that he approached and convinced
was only P4,500.00 and that it was them who paid the same. The
Lucila to let him till the land. According to Juanario, he had never
payment and signing of the deed of sale allegedly took place in the
spoken to Lucila about the lot and it was Felomina who recruited
office of Atty. Teodoro Emboy in the presence of the seller and her
him to be the caretaker of the litigated property.
siblings namely, Aquilino Caldoza and the late Lilia Caldoza.

 A year later, Juanario approached Lucila and volunteered to till the lot, The fact that it was Felomina who bought the lot was further bolstered by her
to which she agreed. In 1987, the spouses consented to Felomina’s possession of the following documents from the time of their issuance up to
proposal to develop and lease the lot. They, however, shouldered the the present, to wit: (1) the transfer certificate of title and tax declaration in
real property taxes on the lot, which was paid through Felomina. In the name of Lucila; (2) the receipts of real property taxes in the name of
1990, the spouses demanded rental from Felomina but she refused to Felomina Abellana for the years 1982-1984, 1992-1994 and 1995; and (3)
pay because her agricultural endeavor was allegedly not profitable. the survey plan of the lot.

2. What is the nature of the transaction between Felomina and Lucila?

Donation of immovable property. Article 749. In order that the donation of an immovable property may be valid,
it must be made in a public document, specifying therein the property donated
and the value of the charges which the donee must satisfy.
It appears that Felomina, being of advanced age with no family of her own,
used to purchase properties and afterwards give them to her nieces. In fact, The acceptance may be made in the same deed of donation or in a separate
aside from the lot she bought for Lucila, she also purchased 2 lots, one from public document, but it shall not take effect unless it is done during the lifetime
Aquilino Caldoza and the other from Domiciano Caldoza, which she gave to of the donor.
Lucila’s sister, Zaida Bascones. Likewise, in the case of Lucila, though it was
Felomina who paid for the lot, she had Lucila designated in the deed as the If the acceptance is made in a separate instrument, the donor shall be notified
vendee thereof and had the title of the lot issued in Lucila’s name. It is clear thereof in an authentic form, and this step shall be noted in both instruments.
therefore that Felomina donated the land to Lucila. This is evident from her
declarations, viz: In the instant case, what transpired between Felomina and Lucila was a
donation of an immovable property which was not embodied in a public
Witness instrument as required by the foregoing article. Being an oral donation, the
transaction was void. Moreover, even if Felomina enjoyed the fruits of the land
A In 1981 there was a riceland offered so I told her that I will buy that land and I
with the intention of giving effect to the donation after her demise, the
will give to her later (sic), because since 1981 up to 1992 Mrs. Lucila Ponce has no
job. conveyance is still a void donation mortis causa, for non-compliance with the
Q Where is the land located? formalities of a will. No valid title passed regardless of the intention of
A In Los Angeles, Butuan City. Felomina to donate the property to Lucila, because the naked intent to
Q Who was the owner of this land? convey without the required solemnities does not suffice for gratuitous
A The owner of that land is Mrs. Estela Caldoza-Pacr[e]s.
The husband is Pacr[e]s. alienations, even as between the parties inter se. At any rate, Felomina
xxx xxx xxx now seeks to recover title over the property because of the alleged ingratitude
Q What did you do with this land belonging to Mrs. Estela-Caldoza- Pacr[e]s? of the respondent spouses.
A I paid the lot, then worked the lot, since at the start of my buying the lot until now
(sic).
Q You said that you told Lucila Ponce that you would give the land to her later Unlike ordinary contracts (which are perfected by the concurrence of the
on, what did you do in connection with this intention of yours to give the land to requisites of consent, object and cause pursuant to Article 1318 of the Civil
her?
Code), solemn contracts like donations are perfected only upon
A So I put the name of the title in her name in good faith (sic).
Q You mean to tell the court that when you purchased this land located at Los compliance with the legal formalities under Articles 748 and 749.
Angeles, Butuan City, the instrument of sale or the deed of sale was in the name of Otherwise stated, absent the solemnity requirements for validity, the mere
Lucila Ponce? intention of the parties does not give rise to a contract. The oral donation in the
A Yes, sir.
xxx xxx xxx
case at bar is therefore legally inexistent and an action for the declaration of
Q Did you not ask your adviser Rudolfo [Torreon] whether it was wise for you to place the inexistence of a contract does not prescribe. Hence, Felomina can still
the property in the name of Lucila Ponce when you are the one who is the owner? recover title from Lucila.
A Because we have really the intention to give it to her.
4. Whether or not there was an implied trust in this case.
3. Whether or not the donation herein is valid.
None.
No.
Article 1448 of the Civil Code on implied trust finds no application in the instant
Generally, contracts are obligatory in whatever form they may have been case. The concept of implied trusts is that from the facts and circumstances of
entered into, provided all the essential requisites for their validity are present. a given case, the existence of a trust relationship is inferred in order to effect
When, however, the law requires that a contract be in some form in order that the presumed intention of the parties. Thus, one of the recognized
it may be valid, that requirement is absolute and indispensable. Its non- exceptions to the establishment of an implied trust is where a contrary
observance renders the contract void and of no effect. Thus, under Article intention is proved, as in the present case. From the testimony of
749 of the Civil Code – Felomina herself, she wanted to give the lot to Lucila as a gift. To her
mind, the execution of a deed with Lucila as the buyer and the
subsequent issuance of title in the latter’s name were the acts that would
effectuate her generosity. In so carrying out what she conceived,
Felomina evidently displayed her unequivocal intention to transfer
ownership of the lot to Lucila and not merely to constitute her as a
trustee thereof. It was only when their relationship soured that she sought to
revoke the donation on the theory of implied trust, though as previously
discussed, there is nothing to revoke because the donation was never
perfected.

In declaring Lucila as the owner of the disputed lot, the CA applied, among
others, the second sentence of Article 1448 which states –

"x x x However, if the person to whom the title is conveyed is a child, legitimate
or illegitimate, of the one paying the price of the sale, no trust is implied by
law, it being disputably presumed that there is a gift in favor of the child."

Said presumption also arises where the property is given to a person to whom
the person paying the price stands in loco parentis or as a substitute parent.

The abovecited provision, however, is also not applicable here because,

first, it was not established that Felomina stood as a substitute parent of
Lucila; and second, even assuming that she did, the donation is still void
because the transfer and acceptance was not embodied in a public
instrument.

We note that said provision merely raised a presumption that the

conveyance was a gift but nothing therein exempts the parties from
complying with the formalities of a donation. Dispensation of such
solemnities would give rise to anomalous situations where the formalities of a
donation and a will in donations inter vivos, and donations mortis causa,
respectively, would be done away with when the transfer of the property is
made in favor of a child or one to whom the donor stands in loco parentis. Such
a scenario is clearly repugnant to the mandatory nature of the law on donation.

WHEREFORE, in view of all the foregoing, the petition is GRANTED. RTC decision
REINSTATED with the following MODIFICATIONS:

(1) Declaring petitioner Felomina Abellana as the absolute owner of Lot 3,

Pcs-10-000198;
(2) Ordering the Register of Deeds of Butuan City to cancel TCT No. T-2874
in the name of respondent Lucila Ponce and to issue a new one in the name
of petitioner Felomina Abellana; and
(3) Deleting the awards of attorney’s fees and litigation expenses for lack of
basis.