J.L.T. Agro v. Balansag

J.L.T. AGRO, INC., represented by its Manager, JULIAN L. TEVES vs.
ANTONIO BALANSAG and

HILARIA CADAYDAY, G.R. No. 141882, March 11, 2005
FACTS:
Don Julian Teves contracted two marriages. He had two children with the first wife Antonia and four
children with the second wife Milagros. The present controversy involves a parcel of land which was
originally registered in the name of the conjugal partnership of Don Julian and Antonia. The said land was
among the properties involved in an action for partition and damages, where the parties entered into a
Compromise Agreement which embodied the partition of all the properties of Don Julian.
On the basis of the compromise agreement, the CFI declared a tract of land known as Hacienda Medalla
Milagrosa as property owned in common by Don Julian and his two children of the first marriage. The
property was to remain undivided during the lifetime of Don Julian. Milagros Donio and her children had
immediately taken possession over the subject lot after the execution of the Compromise Agreement..
On November 16, 1972, Don Julian, Emilio and Josefa executed a Deed of Assignment of Assets with
Assumption of Liabilities in favor of J.L.T. Agro, Inc. Less than a year later, they again executed an
instrument, a Supplemental Deed, which constitutes a supplement to the earlier deed of assignment
transferred ownership over Lot No. 63, among other properties, in favor of petitioner. On April 14, 1974,
Don Julian died intestate.
In 1974, Milagros Donio and her children entered into a yearly lease agreement with spouses Antonio
Balansag and Hilaria Cadayday. On March 18, 1980, Milagros Donio and her children executed a Deed of
Extrajudicial Partition of Real Estate, in which Lot No. 63 was allotted to Milagros Donio and her two
children. Unaware that the subject lot was already registered in the name of petitioner, respondents
bought Lot No. 63. Respondents failed to register the deed as they discovered that the lot was already
titled in the name of petitioner.
Respondents then filed a complaint before the RTC seeking declaration of nullity and cancellation of TCT
No. T-375 in the name of petitioner and transfer the title in their names, plus damages. However, the trial
court dismissed the complaint. The respondents appealed to the CA which reversed the trial court’s
decision. Aggrieved by the appellate court’s decision, petitioner filed a petition for review on certiorari.
ISSUE/S:
Whether or not a future legitime can be determined, adjudicated and reserved prior to the death of the
testator.
RULING:
Yes. As provided in Article 1347, all things, even future ones, which are not outside the commerce of
man may be the object of a contract. The exception is that no contract may be entered into with
respect to future inheritance, and the exception to the exception is the partition inter vivos referred to
in Article 1080 which states that: “Should a person make a partition of his estate by an act inter
vivos, or by will, such partition shall be respected, insofar as it does not prejudice the legitime of the
compulsory heirs.”
The partition will, of course, be effective only after death. It does not necessarily require the
formalities of a will for after all, it is not the partition that is the mode of acquiring ownership. Neither
will the formalities of a donation be required since donation will not be the mode of acquiring the
ownership here after death; since no will has been made it follows that the mode will be succession
(intestate succession). Besides, the partition here is merely the physical determination of the part to
be given to each heir.
The partition inter vivos of the properties of Don Julian is undoubtedly valid pursuant to Article 1347.
However, considering that it would become legally operative only upon the death of Don Julian, the
right of his heirs from the second marriage to the properties adjudicated to him under the
compromise agreement was but a mere expectancy. It was a bare hope of succession to the
property of their father. It had no attribute of property, and the interest to which it related was at the
time nonexistent and might never exist.
Evidently, at the time of the execution of the deed of assignment covering Lot No. 63 in favor of petitioner,
Don Julian remained the owner of the property since ownership over the subject lot would only pass to his
heirs from the second marriage at the time of his death.
However, the Supplemental Deed could not validly operate as a donation as clearly provided in Article
749 of the New Civil Code and in the case of Sumipat vs. Banga.
The Court declared that title of immovable property does not pass from the donor to the donee by virtue of
a deed of donation until and unless it has been accepted in a public instrument and the donor duly notified
thereof. The acceptance may be made in the very same instrument of donation. If the acceptance does
not appear in the same document, it must be made in another. Where the deed of donation fails to show
the acceptance, or where the formal notice of the acceptance, made in a separate instrument, is either
not given to the donor or else not noted in the deed of donation and in the separate acceptance, the
donation is null and void.
In the case at bar, although the Supplemental Deed appears in a public document, the absence of
acceptance by the donee in the same deed or even in a separate document is a violation of the
requirement.

J.L.T. Agro v. Balansag

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J.L.T. AGRO, INC., represented by its Manager, JULIAN L. TEVES vs.

ANTONIO BALANSAG and

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