FIRST DIVISION [G.R. No. 120864. October 8, 2003.] MANUEL T. DE GUIA, petitioner, vs.

COURT OF APPEALS (Former Sixth Division) and JOSE B. ABEJO, represented by his Attorney-inFact, Hermenegilda Abejo-Rivera, respondents.

The trial court rendered judgment against De Guia, holding: a) that ABEJO has the right to demand that DE GUIA vacate and surrender an area equivalent to ABEJO'S. share in the fishpond, but in the meantime, due to lack of evidence of judicial or extrajudicial partition of the property, DE GUIA was ordered to pay a reasonable amount as rental for the use of ABEJO's share; (b) that DE GUIA and the Lejano Heirs as well as their successors-in-interest are not entitled to the relief prayed for in the amended complaint to annul the Kasunduan ng Sanglaan and Kasulatan ng Pagbubuwis ng Palaisdaan and DISMISSED the same for lack of cause of action. The trial court likewise declared the "Kasunduan ng Sanglaan" as valid and ordered the sheriff to proceed to foreclose the aforesaid mortgage. The Court of Appeals affirmed the decision of the trial court and held, among others, that: (a) there is no irregularity in the execution of the aforementioned contract of mortgage; and (b) ABEJO's right over his 1/2 undivided share in the fishpond justified the action for recovery of possession. The trial court's decision effectively enforces Abejo's right over the property which was violated by DE GUIA by possession and use without paying compensation. According to the Court of Appeals, partition would constitute a mechanical aspect of the decision, just like accounting when necessary. On review; the Supreme Court ruled that the petition is partly meritorious, and held: (a) that any co-owner may file an action under Article 487 not only against a third person, but also against another co-owner who takes exclusive possession and asserts exclusive ownership of the property. In the latter case, however, the only purpose of the action is to obtain recognition of the co-ownership, but the plaintiff cannot recover a material or determinate part of a common property prior to partition; (b) the courts cannot proceed without the actual partitioning of the property, hence, judicial or extrajudicial partition is necessary; (c) despite DE GUIA'S acquisition of his 1/2 undivided share in the fishpond on Nov. 22, 1983, after the expiration of his lease of the entire fishpond which was agreed upon by the Lejano heirs and Teofilo Abejo in 1979, DE GUIA should pay reasonable rent to ABEJO corresponding to the latter's share of the 1/2 undivided portion computed at the yearly rental of P825,000.00.

Manuel T. De Guia in his own behalf. Abaejo & Partners Law Offices for private respondents. SYNOPSIS The subject fishpond has a total area of 79,220 square meters, co-owned by Primitiva Lejano and Lorenza Araniego, married to Juan Abejo, and registered in their names under TCT No. 6358 of the Bulacan Register of Deeds. Petitioner De Guia, along with a certain Aniano Vieta, acquired possession of the entire fishpond by virtue of a document captioned Salin ng Pamumusisyong ng Palaisdaan (Lease Contract) executed between him and the heirs of Primitiva Lejano, effective from 30 July 1974 to 30 November 1979 for a consideration of Pl00,000 with the knowledge and consent of Teofilo Abejo, the sole heir of Lorenza Araniego Abejo who acquired 1/2 undivided share of the latter by intestate succession. Teofilo Abejo, now deceased, sold his undivided share in the fishpond to his son Abejo. Despite the expiration of the lease contract, De Guia continued to possess the entire fishpond and to derive income therefrom despite. several demands to vacate by Teofilo Abejo and by his successor-in-interest, Abejo. The last demand letter was dated 22 November 1983. Abejo filed his complaint for recovery of possession with damages against De Guia for the other 1/2 undivided portion of the fishpond which has not been finally adjudicated for or against him. De Guia offered as evidence of his ownership of the other undivided portion of the fishpond the verified Complaint for Annulment of Real Estate Mortgage and Contract of Lease (Kasunduan ng Sanglaan and Kasulatan ng Pagbubuwis ng Palaisdaan) with Preliminary Injunction signed by the heirs of Primitiva Lejano which he filed for himself and in representation as attorney-in-fact of said heirs. He alleged that he acquired his 1/2 undivided share in the fishpond from the Lejano Heirs in 1986, and that they filed the complaint for annulment of said document because Primitiva Lejano allegedly signed these documents under duress and without consideration.

SYLLABUS 1. CIVIL CODE; PROPERTY; CO-OWNERSHIP; WHEN IT EXISTS; CASE AT BAR. Under Article 484 of the Civil Code, "there is co-ownership whenever the ownership of an undivided thing or right belongs to different persons." A co-owner of an undivided parcel of land is an "owner of the whole, and over the whole he exercises the right of dominion, but he is at the same time the owner of a portion which is truly abstract." On the other hand, there is no co-ownership when the different portions owned by different people are already concretely determined and separately identifiable, even if

not yet technically described. . . . Following the inherent and peculiar features of coownership, while ABEJO and DE GUIA have equal shares in the fishpond quantitavely speaking, they have the same right in a qualitative sense as co-owners. Simply stated, ABEJO and DE GUIA are owners of the whole and over the whole, they exercise the right of dominion. However, they are at the same time individual owners of a 1/2 portion, which is truly abstract because until there is partition, such portion remains indeterminate or unidentified. As co-owners, ABEJO and DE GUIA may jointly exercise the right of dominion over the entire fishpond until they partition the FISHPOND by identifying or segregating their respective portions. 2. ID.; ID.; ID.; ACTIONS FOR RECOVERY OF POSSESSION UNDER ART. 487 OF THE CIVIL CODE. Article 487 of the Civil Code provides, "[a]ny one of the co-owners may bring an action in ejectment." This article covers all kinds of actions for the recovery of possession. Article 487 includes forcible entry and unlawful detainer (action interdictal), recovery of possession (action publiciana) and recovery of ownership (action de reivindicacion). 3. REMEDIAL LAW; FORCIBLE ENTRY AND UNLAWFUL DETAINER; RECOVERY OF POSSESSION UNDER ART. 487 OF THE CIVIL CODE; JURISDICTION OF COURTS. The summary actions of forcible entry and unlawful detainer seek the recovery of physical possession only. These actions are brought before the municipal trial courts, within one year from dispossession. However, accion publiciana, which is a plenary action for recovery of the right to possess falls under the jurisdiction of the proper regional trial court when the dispossession has lasted for more than one year. Accion de reivindicacion which seeks the recovery of ownership, also falls under the jurisdiction of the proper regional trial court. 4. ID.; ID.; RECOVERY OF POSSESSION UNDER ARTICLE 487; EXTENT OF RECOVERY PRIOR TO PARTITION. Any co-owner may file an action under Art. 487 of the New Civil Code, not only against a third person, but also against another co-owner who takes exclusive possession and asserts exclusive ownership of the property. In the latter case, however, the only purpose of the action is to obtain recognition of the co-ownership. The plaintiff cannot seek exclusion of the defendant from the property because as co-owner he has the right of possession. The plaintiff cannot recover any material or determinate part of the property prior to partition. 5. ID.; SPECIAL CIVIL ACTIONS; PARTITION; IMPRESCRIPTIBLE; NECESSARY BEFORE RECOVERY OF POSSESSION UNDER ARTICLE 487 OF THE NEW CIVIL, CODE; CASE AT BAR. Since co-ownership subsists between ABEJO and DE GUIA, judicial or extrajudicial partition is the proper recourse. An action to demand partition is imprescriptible and not subject to laches. Each co-owner may demand at any time the partition of the common property unless a co-owner has repudiated the co-ownership under certain

conditions. Neither ABEJO nor DE GUIA has repudiated the co-ownership under the conditions set by law. To recapitulate, we rule that a co-owner may file an action for recovery of possession against a co-owner who takes exclusive possession of the entire co-owned property. However, the only effect of such action is a recognition of the coownership. The courts cannot proceed with the actual partitioning of the co-owned property. Thus, judicial or extra-judicial partition is necessary to effect physical division of the fishpond between ABEJO and DE GUIA. 6. CIVIL LAW; PROPERTY; CO-OWNERSHIP; RIGHT OF EACH CO-OWNER LIMITED BY RIGHT OF OTHER CO-OWNERS; CASE AT BAR. The right of enjoyment by each coowner is limited by a similar right of the other co-owners. A co-owner cannot devote common property to his exclusive use to the prejudice of the co-ownership. The Lejano heirs and Teofilo Abejo agreed to lease the entire fishpond to DE GUIA. After DE GUIA'S lease expired in 1979, he could no longer use the entire fishpond without paying rent. To allow DE GUIA to continue using the entire FISHPOND without paying rent would prejudice ABEJO'S right to receive rent, which would have accrued to his 1/2 share in the FISHPOND had it been leased to others. Since ABEJO acquired his 1/2 undivided share in the FISHPOND on 22 November 1983, DE GUIA should pay ABEJO reasonable rent for his possession and use of ABEJO' S portion beginning from that date. 7. ID.; DAMAGES; COMPENSATORY DAMAGES; RATE OF INTEREST DUE; CASE AT BAR. ABEJO made an extrajudicial demand on DE GUIA by sending the 27 November 1983 demand letter. Thus, the rent in arrears should earn interest at 6% per annum from 27 November 1983 until finality of this decision pursuant to Article 2209 of the Civil Code. Thereafter, the interest rate is 12% per annum from finality of this decision until full payment.

8. REMEDIAL-LAW; APPEAL; REVIEW `UNDER RULE 45 OF THE REVISED RULES OF COURT; ONLY QUESTIONS OF LAW MAY BE RAISED; CASE AT BAR. Where DE GUIA contends the P212,500.00 in rent awarded to ABEJO is exorbitant and assails as doubtful and self-serving evidence the Lease Contract between ABEJO and Ruperto C. Villarico that served as basis for the yearly rent of P25,000 for ABEJO'S share in the fishpond, the Court ruled that as a general rule, a party may raise only questions of law in an appeal by certiorari under Rule 45 of the Rules of Court. The Supreme Court is not duty-bound to analyze and weigh again the evidence considered in the proceedings below. More so in the instant case, where the Court of Appeals affirmed the factual findings of the trial court. 9. CIVIL LAW; DAMAGES; ATTORNEY'S FEES; FEASIBLE UNDER ARTICLE 2208 OF THE CIVIL CODE; CASE AT BAR. The trial court did not err in imposing attorney's fees of

P20,000. Attorney's fees can be awarded in the cases enumerated in Article 2208 of the Civil Code, specifically ". . . (2) Where the defendant's act or omission has compelled the plaintiff to litigate with third persons or to incur expenses to protect his interest." DE GUIA is a lawyer and he should have known that a co-owner could not take exclusive possession of a common property. Although DE GUIA offered to settle the case out of court, such offer was made under conditions not acceptable to ABEJO. Certainly, ABEJO was still put to unnecessary expense and trouble to protect his interest under paragraph (2), Article 2208 of the Civil Code.

DECISION

DE GUIA, a lawyer by profession, appeared on his own behalf. He filed his Answer on 12 January 1990 after the Court of Appeals resolved several issues concerning the validity of the service of summons on him. In his Answer, DE GUIA alleged that the complaint does not state a cause of action and has prescribed. He claimed that the FISHPOND was originally owned by Maxima Termulo who died intestate with Primitiva Lejano as her only heir. According to him, ABEJO is not the owner of the entire FISHPOND but the heirs of Primitiva Lejano who authorized him to possess the entire FISHPOND. He assailed ABEJO's ownership of the undivided portion of the FISHPOND as void and claimed ownership over an undivided half portion of the FISHPOND for himself. DE GUIA sought payment of damages and reimbursement for the improvements he introduced as a builder in good faith. The trial court set the pre-trial and required the parties to file their pre-trial briefs. ABEJO filed his pre-trial brief 5 on 05 April 1990. DE GUIA filed his pre-trial brief 6 on 31 July 1990. DE GUIA's pre-trial brief raised as the only issue in the case the amount of damages in the form of rent that DE GUIA should pay ABEJO. DE GUIA also submitted an Offer to Compromise, 7 offering to settle ABEJO's claim for P300,000 and to lease the entire FISHPOND to any party of ABEJO's choice. Hearing commenced on 30 July 1990. ABEJO rested his case on 4 December 1990. DE GUIA's last witness completed her testimony on 22 November 1991. The trial court summarized the evidence presented by ABEJO and DE GUIA as follows: Evidence adduced from plaintiff shows that there are two parcels of land covering a fishpond with a total area of 79,220 sq. m. more or less, situated at Ubihan, Meycauayan, Bulacan and covered by TCT No. 6358 equally owned by Primitiva Lejano and Lorenza Araniego married to Juan Abejo (Exh. A). The one half undivided portion owned by Lorenza Araniego corresponding to 39,611 sq. m. was later purchased by plaintiff from his father Teofilo Abejo (Exh. B), the only heir of the original owner on November 22, 1983. Prior to this sale on July 30, 1974 the whole fishpond (79,220) was the subject of a "Salin ng Pamumusisyong ng Palaisdaan" executed by the heirs of Primitiva Lejano with the knowledge and consent of Teofilo A. Abejo in favor of one Aniano Victa and defendant. The contract provided that the period of lease shall be until November 30, 1979. When the contract expired and defendant failed to surrender the fishpond, written demands the last of which was on November 27, 1983 were made for defendants to pay back rental and to vacate the premises in question (Exh. D & E). Defendant refused to deliver possession and also to pay the rentals due. In anticipation, however, that defendant will vacate the fishpond,

CARPIO, J p: The Case This is a Petition for Review on Certiorari 1 assailing the 22 August 1994 Decision 2 as well as the 27 June 1995 Resolution of the Court of Appeals in CA-G.R. CV No. 39875. The Court of Appeals affirmed the Decision 3 of the Regional Trial Court ("trial court") of Malolos, Bulacan, Branch 16, in Civil Case No. 8796-M. The trial court's Decision ordered petitioner Manuel T. De Guia ("DE GUIA") to turn over to private respondent Jose B. Abejo ("ABEJO") possession of the one half () undivided portion of a fishpond and to pay actual damages and attorney's fees. The Antecedents On 12 May 1986, ABEJO 4 instituted an action for recovery of possession with damages against DE GUIA. In his complaint, ABEJO alleged that he is the owner of the undivided portion of a property used as a fishpond ("FISHPOND") situated in Meycauayan, Bulacan and covered by TCT No. T-6358 of the Bulacan Register of Deeds. He alleged ownership over approximately 39,611 square meters out of the FISHPOND's total area of 79,220 square meters. ABEJO further averred that DE GUIA continues to possess and use the FISHPOND without any contract and without paying rent to ABEJO's damage and prejudice. ABEJO also complained that DE GUIA refuses to surrender ownership and possession of the FISHPOND despite repeated demands to do so after DE GUIA's sublease contract over the FISHPOND had expired. ABEJO asked the trial court to order DE GUIA to vacate an approximate area of 39,611 square meters as well as pay damages.

plaintiff, on December 21, 1983 entered into a two year "Kasunduan ng Buwisan ng Palaisdaan" with Ruperto C. Villarico for a consideration of P50,000.00 (Exh. G). This contract, despite its execution and even already notarized, had to be cancelled and the amount of P50,000.00 returned by plaintiff to Villarico when the defendant did not heed the demand to vacate the fishpond. For unpaid rental, actual as well as moral and exemplary damages, plaintiff asks payment of P450,000.00 and P20,000.00 attorney's fees. On the other hand, defendant's evidence tends to show that the entire fishpond with an area of 79,200 sq. m. was leased to him by the heirs of Primitiva Lejano. Subsequently, defendant became the absolute owner of one half of the undivided area of the fishpond and he questioned plaintiffs ownership of the other half as void and fraudulent. As to the area pertaining to plaintiff, defendant claimed that he introduced improvements worth P500,000 and being in good faith, he asked that he should be reimbursed by plaintiff. In his pre-trial brief, however, defendant raised the only issue which is the amount of damages plaintiff is entitled to in the form of rental. Hence, the thrust of the testimonies of defendant's witnesses particularly Ben Ruben Camargo and Marta Fernando Pea was the amount of rental of fishponds in the same locality as the fishpond in question at a given time. However, the documentary evidence (Exhs. 1 and 2) in support of their testimony were not offered as evidence. 8 The trial court rendered its decision on 8 June 1992, disposing as follows: WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiff and against the defendant and hereby orders that: 1. Defendant shall turn over possession to plaintiff one half undivided portion of the 79,200 sq. m. fishpond who shall enjoy the benefits and fruits in equal share with the defendant effective immediately until such time that partition of the property is effected; 2. Defendant shall pay to plaintiff the amount of P262,500.00 by way of actual or compensatory damages;

3. Defendant shall pay plaintiff P20,000.00 as and for attorney's fees; and 4. To pay the costs. SO ORDERED. 9 Aggrieved, DE GUIA went to the Court of Appeals insisting the trial court erred in ordering him to vacate and surrender possession of the undivided portion of the FISHPOND and to pay actual damages and attorney's fees. The Court of Appeals found DE GUIA's appeal without merit and affirmed the trial court's decision. Upon DE GUIA's motion for reconsideration, the appellate court reduced the compensatory damages from P262,500 to P212,500. Hence, the instant petition. The undisputed facts as found by the trial court and adopted in toto by the Court of Appeals are restated as follows: 1. The subject of the dispute are two undivided parcels of land used as a fishpond situated in Barrio Ubihan, Meycauayan, Bulacan, originally co-owned by Primitiva Lejano and Lorenza Araniego married to Juan Abejo. 2. The FISHPOND is registered under the names of Primitiva Lejano and Lorenza Araniego under TCT No. 6358 of the Bulacan Register of Deeds as follows: PRIMITIVA LEJANO, Filipina, of legal age, single share; and LORENZA ARANIEGO, Filipina, of legal age, married to Juan Abejo, share, 3. The FISHPOND has a total land area of approximately 79,220 square meters. ABEJO is seeking to recover possession of the undivided portion of the FISHPOND containing 39,611 square meters. 4. DE GUIA (along with a certain Aniano Victa) acquired possession of the entire FISHPOND by virtue of a document captioned Salin ng Pamumusisyong ng Palaisdaan ("Lease Contract") executed between him and the heirs of Primitiva Lejano.

The Lease Contract was effective from 30 July 1974 up to 30 November 1979 for a consideration of P100,000. 5. The Lease Contract was executed with the knowledge and consent of Teofilo Abejo, sole heir of Lorenza Araniego Abejo. Teofilo Abejo acquired Lorenza Araniego Abejo's undivided share in the FISHPOND by intestate succession. 6. Teofilo Abejo (now deceased) sold his undivided share in the FISHPOND to his son, ABEJO, on 22 November 1983. 7. DE GUIA continues to possess the entire FISHPOND and to derive income from the property despite the expiration of the Lease Contract and several demands to vacate made by Teofilo Abejo and by his successor-in-interest, ABEJO. The last demand letter was dated 27 November 1983. 8. ABEJO filed his complaint for recovery of possession with damages against DE GUIA on 12 May 1986. 9. DE GUIA's claim of ownership over the other undivided portion of the FISHPOND has not been finally adjudicated for or against him. DE GUIA offers the verified Complaint for Annulment of Real Estate Mortgage and Contract of Lease with Preliminary Injunction signed by the heirs of Primitiva Lejano as proof of his ownership of the other undivided half portion of the FISHPOND. Records show that DE GUIA filed the complaint for himself and as attorney-in fact of the heirs of Primitiva Lejano ("Lejano Heirs") 10 against Spouses Teofilo Morte and Angelina Villarico, Spouses Ruperto and Milagros Villarico, et al. ("Defendants"). The case was raffled to Branch 12 of the Regional Trial Court of Malolos, Bulacan, and docketed as Civil Case. No. 86-27-M. The complaint alleged that DE GUIA acquired his undivided share in the FISHPOND from the Lejano Heirs in February 1986. DE GUIA and the Lejano Heirs sought to annul the Kasulatan ng Sanglaan and Kasulatan ng Pagbubuwis ng Palaisdaan, executed on 10 November 1979 by Primitiva Lejano in favor of the Defendants. DE GUIA and the Lejano Heirs claimed that Primitiva Lejano signed these documents under duress and without consideration. The trial court rendered judgment 11 on 28 February 1992 against DE GUIA and the Lejano Heirs as follows:

WHEREFORE, the evidence having shown the plaintiffs, particularly Manuel De Guia, their successor-in-interest, not entitled upon the facts and the law to the relief prayed for in the amended complaint, the same is hereby DISMISSED with costs against said plaintiff. Instead, as prayed for by defendants, judgment is hereby rendered: 1. Declaring the "Kasulatan ng Sanglaan" (Exhs. "A" & "1") dated November 10, 1979, and the "Kasulatan ng Pagbubuwis ng Palaisdaan" (Exhs. "C" & "3") also dated November 10, 1979, as valid for all legal intents and purposes; 2. Ordering the Ex-Officio Sheriff, RTC, Bulacan, to proceed with the extrajudicial foreclosure of the subject real estate mortgage; and 3. Ordering plaintiffs to pay defendants attorney's fees in the amount of P20,000.00. SO ORDERED. 12 The Court of Appeals affirmed the trial court in a Decision dated 30 August 2002 in CAG.R. CV No. 38031. The Court of Appeals found the claim of force and intimidation in the execution of the documents as highly improbable since Primitiva Lejano's son, Renato Davis, witnessed the signing of the documents and found nothing irregular at the time. The appellate court also held that assuming Defendants threatened DE GUIA and the Lejano Heirs with immediate foreclosure, Defendants were merely exercising their legitimate right of foreclosing the mortgaged property for non-payment of the loan. In addition, Primitiva Lejano's lawyer and notary public, Atty. Mamerto Abao, testified that the parties appeared before him to affirm the contents of the documents. He also stated that he was present when Defendants paid Primitiva Lejano Davis and her son Renato. As of this writing, DE GUIA has a pending motion for reconsideration before the Court of Appeals. In the event the Court of Appeals' Decision attains finality, DE GUIA may lose whatever right he claims over the FISHPOND. The Trial Court's Ruling The trial court ruled that ABEJO has the right to demand that DE GUIA vacate and surrender an area equivalent to ABEJO's undivided share in the FISHPOND. The trial court explained that DE GUIA's sublease contract expired in 1979 and ABEJO acquired his father's share in 1983. However, the trial court pointed out that ABEJO failed to present evidence of the judicial or extra-judicial partition of the FISHPOND. The identification of the specific area pertaining to ABEJO and his co-owner is vital in an

action to recover possession of real property. Nevertheless, the trial court declared that pending partition, it is only just that DE GUIA pay ABEJO a reasonable amount as rental for the use of ABEJO's share in the FISHPOND. DE GUIA admitted this obligation when he raised as sole issue in his pre-trial brief how much rent he should pay ABEJO. DE GUIA even proposed P300,000 as the reasonable amount but under certain conditions which ABEJO found unacceptable. In determining the reasonable rent due to ABEJO, the trial court considered the Lease Contract between ABEJO and a certain Ruperto C. Villarico which provided for a yearly rent of P25,000 for undivided portion of the FISHPOND. The trial court declared that the total amount of rent due is P212,500, computed from November 1983 when ABEJO became a co-owner of the FISHPOND up to 1991 13 or a period of eight and one half years. The trial court further ordered DE GUIA to pay an additional P50,000 which represents the amount ABEJO returned to Ruperto C. Villarico when they cancelled the Lease Contract between them due to DE GUIA's refusal to vacate the FISHPOND. Lastly, the trial court ruled that pending partition, ABEJO as co-owner has the right to possess the FISHPOND and to receive an equal share in the benefits from the FISHPOND effective immediately. Until there is a partition, and while there is no contract of lease, the Civil Code provisions on co-ownership shall govern the rights of the parties. The Court of Appeals' Ruling The Court of Appeals affirmed the trial court's decision. The Court of Appeals debunked DE GUIA's claim that partition and not recovery of possession was the proper remedy under the circumstances. The Court of Appeals pointed out that DE GUIA's failure to respect ABEJO's right over his undivided share in the FISHPOND justifies the action for recovery of possession. The trial court's decision effectively enforces ABEJO's right over the property which DE GUIA violated by possession and use without paying compensation. According to the Court of Appeals, partition would constitute a mechanical aspect of the decision just like accounting when necessary. The Court of Appeals likewise rejected DE GUIA's claim that the award of compensatory damages of P242,000, computed based on the rent stipulated in the Lease Contract between ABEJO and Ruperto C. Villarico, is grossly exorbitant. The Court of Appeals clarified that the amount the trial court awarded was P262,500 and not P242,000 as erroneously alleged by DE GUIA. The Court of Appeals pointed out that the notarized Lease Contract between ABEJO and Ruperto C. Villarico carries more evidentiary weight than the testimonies of DE GUIA's witnesses, Ben Ruben Camargo and Marta Fernando Pea. The Court of Appeals also upheld the award of attorney's fees since the parties could have avoided litigation had DE GUIA heeded the justifiable demands of ABEJO. aCATSI

On motion for reconsideration, the Court of Appeals reduced the compensatory damages from P262,500 to P212,500. The Court of Appeals explained that the trial court correctly computed the total amount of rent due at P212,500. The trial court erred, however, in adding the sum of P50,000 representing the rent for 1983 and 1984 which ABEJO returned to Ruperto C. Villarico. The appellate court clarified that the sum of P212,500 was arrived at by multiplying the rent of P25,000 by 8 years. The 8 year period already included the two months rent received from and then subsequently reimbursed to Ruperto C. Villarico. The Issues DE GUIA raises the following issues in his Memorandum: THE COURT OF APPEALS ERRED IN AFFIRMING THE TRIAL COURT'S DECISION DENYING PETITIONER'S PLEA FOR DISMISSAL OF THE COMPLAINT FOR FAILURE TO STATE A CAUSE OF ACTION; II THE COURT OF APPEALS ERRED IN AFFIRMING THE TRIAL COURT'S ORDER DIRECTING PETITIONER TO TURN OVER THE ONE-HALF UNDIVIDED PORTION OF THE FISHPOND WHICH IS STILL UNDER A STATE OF CO-OWNERSHIP; III THE COURT OF APPEALS ERRED IN AFFIRMING, IN PART, THE AWARD OF ACTUAL OR COMPENSATORY DAMAGES DESPITE LACK OF CREDIBLE EVIDENCE TO SUPPORT THE SAME; IV THE COURT OF APPEALS ERRED IN AFFIRMING THE AWARD OF ATTORNEY'S FEES IN PRIVATE RESPONDENT'S FAVOR. 14 In essence, this Court is asked to resolve: (1) whether an action for recovery of possession and turn-over of the undivided portion of a common property is proper before partition; and (2) whether there is sufficient basis for the award of compensatory damages and attorney's fees. The Court's Ruling

The petition is partly meritorious. First and Second Issues: Cause of Action and Turn-Over of Possession DE GUIA contends that a co-owner cannot claim a definite portion from the property owned in common until there is a partition. DE GUIA argues that ABEJO should have filed an action for partition instead of recovery of possession since the court cannot implement any decision in the latter case without first a partition. DE GUIA contends that an action for recovery of possession cannot prosper when the property subject of the action is part of an undivided, co-owned property. The procedural mode adopted by ABEJO, which is recovery of possession, makes enforcement difficult if not impossible since there is still no partition of the subject property. Under Article 484 of the Civil Code, "there is co-ownership whenever the ownership of an undivided thing or right belongs to different persons." A co-owner of an undivided parcel of land is an "owner of the whole, and over the whole he exercises the right of dominion, but he is at the same time the owner of a portion which is truly abstract." 15 On the other hand, there is no co-ownership when the different portions owned by different people are already concretely determined and separately identifiable, even if not yet technically described. 16 Article 487 of the Civil Code provides, "[a]ny one of the co-owners may bring an action in ejectment." This article covers all kinds of actions for the recovery of possession. Article 487 includes forcible entry and unlawful detainer (accion interdictal), recovery of possession (accion publiciana), and recovery of ownership (accion de reivindicacion). The summary actions of forcible entry and unlawful detainer seek the recovery of physical possession only. These actions are brought before municipal trial courts within one year from dispossession. However, accion publiciana, which is a plenary action for recovery of the right to possess, falls under the jurisdiction of the proper regional trial court when the dispossession has lasted for more than one year. Accion de reivindicacion, which seeks the recovery of ownership, also falls under the jurisdiction of the proper regional trial court. 17 Any co-owner may file an action under Article 487 not only against a third person, but also against another co-owner who takes exclusive possession and asserts exclusive ownership of the property. 18 In the latter case, however, the only purpose of the action is to obtain recognition of the co-ownership. The plaintiff cannot seek exclusion of the defendant from the property because as co-owner he has a right of possession. The plaintiff cannot recover any material or determinate part of the property. 19

In Hermogena G. Engreso with Spouse Jose Engreso v. Nestoria De La Cruz and Herminio De La Cruz, 20 we reiterated the rule that a co-owner cannot recover a material or determinate part of a common property prior to partition as follows: It is a basic principle in civil law that before a property owned in common is actually partitioned, all that the co-owner has is an ideal or abstract quota or proportionate share in the entire property. A co-owner has no right to demand a concrete, specific or determinate part of the thing owned in common because until division is effected his right over the thing is represented only by an ideal portion. As such, the only effect of an action brought by a co-owner against a co-owner will be to obtain recognition of the co-ownership; the defendant cannot be excluded from a specific portion of the property because as a co-owner he has a right to possess and the plaintiff cannot recover any material or determinate part of the property. Thus, the courts a quo erred when they ordered the delivery of one-half () of the building in favor of private respondent. Indisputably, DE GUIA has been in exclusive possession of the entire FISHPOND since July 1974. Initially, DE GUIA disputed ABEJO's claim of ownership over the undivided portion of the FISHPOND. Subsequently, he implicitly recognized ABEJO's undivided share by offering to settle the case for P300,000 and to vacate the property. During the trial proper, neither DE GUIA nor ABEJO asserted or manifested a claim of absolute and exclusive ownership over the entire FISHPOND. Before this Court, DE GUIA limits the issues to the propriety of bringing an action for recovery of possession and the recovery of compensatory damages. Following the inherent and peculiar features of co-ownership, while ABEJO and DE GUIA have equal shares in the FISHPOND quantitatively speaking, they have the same right in a qualitative sense as co-owners. Simply stated, ABEJO and DE GUIA are owners of the whole and over the whole, they exercise the right of dominion. However, they are at the same time individual owners of a portion, which is truly abstract because until there is partition, such portion remains indeterminate or unidentified. 21 As co-owners, ABEJO and DE GUIA may jointly exercise the right of dominion over the entire FISHPOND until they partition the FISHPOND by identifying or segregating their respective portions. Since a co-ownership subsists between ABEJO and DE GUIA, judicial or extra-judicial partition is the proper recourse. An action to demand partition is imprescriptible and not subject to laches. 22 Each co-owner may demand at any time the partition of the

common property unless a co-owner has repudiated the co-ownership under certain conditions. 23 Neither ABEJO nor DE GUIA has repudiated the co-ownership under the conditions set by law. To recapitulate, we rule that a co-owner may file an action for recovery of possession against a co-owner who takes exclusive possession of the entire co-owned property. However, the only effect of such action is a recognition of the co-ownership. The courts cannot proceed with the actual partitioning of the co-owned property. Thus, judicial or extra-judicial partition is necessary to effect physical division of the FISHPOND between ABEJO and DE GUIA. An action for partition is also the proper forum for accounting the profits received by DE GUIA from the FISHPOND. However, as a necessary consequence of such recognition, ABEJO shall exercise an equal right to possess, use and enjoy the entire FISHPOND. DE GUIA further claims that the trial and appellate courts erred when they ordered the recovery of rent when the exact identity of the portion in question had not yet been clearly defined and delineated. According to DE GUIA, an order to pay damages in the form of rent is premature before partition. We disagree. The right of enjoyment by each co-owner is limited by a similar right of the other coowners. A co-owner cannot devote common property to his exclusive use to the prejudice of the co-ownership. 24 Hence, if the subject is a residential house, all the coowners may live there with their respective families to the extent possible. However, if one co-owner alone occupies the entire house without opposition from the other coowners, and there is no lease agreement, the other co-owners cannot demand the payment of rent. Conversely, if there is an agreement to lease the house, the co-owners can demand rent from the co-owner who dwells in the house. The co-owners can either exercise an equal right to live in the house, or agree to lease it. If they fail to exercise any of these options, they must bear the consequences. It would be unjust to require the co-owner to pay rent after the co-owners by their silence have allowed him to use the property. 25 In case the co-owners agree to lease a building owned in common, a co-owner cannot retain it for his use without paying the proper rent. 26 Moreover, where part of the property is occupied exclusively by some co-owners for the exploitation of an industry, the other co-owners become co-participants in the accessions of the property and should share in its net profits. 27

The Lejano Heirs and Teofilo Abejo agreed to lease the entire FISHPOND to DE GUIA. After DE GUIA's lease expired in 1979, he could no longer use the entire FISHPOND without paying rent. To allow DE GUIA to continue using the entire FISHPOND without paying rent would prejudice ABEJO's right to receive rent, which would have accrued to his share in the FISHPOND had it been leased to others. 28 Since ABEJO acquired his undivided share in the FISHPOND on 22 November 1983, DE GUIA should pay ABEJO reasonable rent for his possession and use of ABEJO's portion beginning from that date. The compensatory damages of P25,000 per year awarded to ABEJO is the fair rental value or the reasonable compensation for the use and occupation of the leased property, 29 considering the circumstances at that time. DE GUIA shall continue to pay ABEJO a yearly rent of P25,000 corresponding to ABEJO's undivided share in the FISHPOND. However, ABEJO has the option either to exercise an equal right to occupy the FISHPOND, or to file a new petition before the trial court to fix a new rental rate in view of changed circumstances in the last 20 years. ABEJO made an extrajudicial demand on DE GUIA by sending the 27 November 1983 demand letter. Thus, the rent in arrears should earn interest at 6% per annum from 27 November 1983 until finality of this decision pursuant to Article 2209 30 of the Civil Code. Thereafter, the interest rate is 12% per annum from finality of this decision until full payment. 31 Third Issue: Lack of Credible Evidence to Support Award of Compensatory Damages DE GUIA contends the P212,500 in rent awarded to ABEJO is exorbitant. He assails as doubtful and self-serving evidence the Lease Contract between ABEJO and Ruperto C. Villarico that served as basis for the yearly rent of P25,000 for ABEJO's share in the FISHPOND. DE GUIA says the trial and appellate courts should have given credence to the testimonies of his witnesses, Ben Ruben Camargo ("Camargo") and Marta Fernando Pea ("Pea") that rentals of fishponds in the same vicinity are for much lesser considerations. This issue involves calibration of the whole evidence considering mainly the credibility of witnesses. As a rule, a party may raise only questions of law in an appeal by certiorari under Rule 45 of the Rules of Court. The Supreme Court is not duty-bound to analyze and weigh again the evidence considered in the proceedings below. 32 More so in the instant case, where the Court of Appeals affirmed the factual findings of the trial court. 33

It is not true that the trial court disregarded the testimonies of Camargo and Pea because DE GUIA failed to present documentary evidence to support their testimonies. Actually, the trial and appellate courts found the testimonies of Camargo and Pea unconvincing. Judges cannot be expected to rely on the testimonies of every witness. In ascertaining the facts, they determine who are credible and who are not. In doing so, they consider all the evidence before them. 34 We find no cogent reason to overturn the trial and appellate courts' evaluation of the witnesses' testimonies. We likewise find reasonable the P25,000 yearly compensation for ABEJO's undivided share in the FISHPOND. Indeed, being a question of fact, it is for the trial and appellate courts to decide and this Court will not disturb their findings unless clearly baseless or irrational. The exception does not obtain in this case.

Bulacan Register of Deeds is recognized without prejudice to the outcome of CA-G.R. CV No. 38031 pending before the Court of Appeals and other cases involving the same property; 2. Manuel T. De Guia and Jose B. Abejo shall equally enjoy possession and use of the entire FISHPOND prior to partition; 3. The compensatory damages of P25,000 per annum representing rent from 27 November 1983 until May 1992 shall earn interest at 6% per annum from 27 November 1983 until finality of this decision, and thereafter at 12% per annum until full payment; 4. Manuel T. de Guia shall pay Jose B. Abejo a yearly rent of P25,000 from June 1992 until finality of this decision, with interest at 6% per annum during the same period, and thereafter at 12% interest per annum until full payment; 5. After finality of this decision and for as long as Manuel T. de Guia exclusively possesses the entire FISHPOND, he shall pay Jose B. Abejo a yearly rental of P25,000 for the latter's undivided share in the FISHPOND, unless Jose B. Abejo secures from the proper court an order fixing a different rental rate in view of possible changed circumstances. ADaSET SO ORDERED. RICARDO PARDELL Y CRUZ, ET AL vs. GASPAR DE BARTOLOME Y ESCRIBANO, ET AL

Fourth Issue: Attorney's Fees The trial court did not err in imposing attorney's fees of P20,000. Attorney's fees can be awarded in the cases enumerated in Article 2208 of the Civil Code specifically: xxx xxx xxx (2) Where the defendant's act or omission has compelled the plaintiff to litigate with third persons or to incur expenses to protect his interest; xxx xxx xxx DE GUIA is a lawyer and he should have known that a co-owner could not take exclusive possession of a common property. Although DE GUIA offered to settle the case out of court, such offer was made under conditions not acceptable to ABEJO. Certainly, ABEJO was still put to unnecessary expense and trouble to protect his interest under paragraph (2), Article 2208 of the Civil Code. WHEREFORE, the Decision dated 22 August 1994 and Resolution dated 27 June 1995 of the Court of Appeals in CA-G.R. CV No. 39875 is AFFIRMED with respect to that portion ordering Manuel T. De Guia to pay Jose B. Abejo compensatory damages of P212,500 and attorney's fees of P20,000, and MODIFIED as follows: 1. The co-ownership between Manuel T. De Guia and Jose B. Abejo over the entire FISHPOND covered by TCT No. 6358 of the

FIRST DIVISION [G.R. No. 4656. November 18, 1912.] RICARDO PARDELL Y CRUZ and VICENTA ORTIZ Y FELIN DE PARDELL, plaintiffs-appellees, vs. GASPAR DE BARTOLOME Y ESCRIBANO and MATILDE ORTIZ Y FELIN DE BARTOLOME, defendants-appellants.

Gaspar de Bartolome in his own behalf. B. Gimenez Zoboli for appellees.

TORRES, J p: This is an appeal by bill of exceptions, from the judgment of October 5, 1907, whereby the Honorable Dionisio Chanco, judge, absolved the defendants from the complaint, and the plaintiff from a counterclaim, without special finding as to costs. Counsel for the spouses Ricardo Pardell y Cruz and Vicenta Ortiz y Felin de Pardell, the first of whom absent in Spain by reason of his employment, conferred upon the second sufficient and ample powers to appear before the courts of justice, on June 8, 1905, in his written complaint, alleged that the plaintiff, Vicenta Ortiz, and the defendant, Matilde Ortiz, are the duly recognized natural daughters of the spouses Miguel Ortiz and Calixta Felin y Paula who died in Vigan, Ilocos Sur, in 1875 and 1882, respectively; that Calixta Felin, prior to her death, executed, on August 17, 1876, a nuncupative will in Vigan, whereby she made her four children, named Manuel, Francisca, Vicenta, and Matilde, surnamed Ortiz y Felin, her sole and universal heirs of all her property; that, of the persons enumerated, Manuel died before his mother and Francisca a few years after her death, leaving no heirs of the said testatrix are the plaintiff Vicenta Ortiz and the defendant Matilde Ortiz; that, aside from some personal property and jewelry already divided among the heirs, the testatrix possessed, at the time of the execution of her will, and left at her death the real properties which, with their respective cash values, are as follows: 1. A house of strong material, with the lot on which it is built, situated on Escalante Street, Vigan, and valued at P6,000.00 2. A house of mixed material, with the lot on which it stands, at No. 88 Washington Street, Vigan valued at 1,500.00 3. A lot on Magallanes Street, Vigan; valued at 100.00 4. A parcel of rice land, situated in the barrio of San Julian,

SYLLABUS 1. ESTATES; REALTY; RIGHTS OF COOWNERS OR TENANTS IN COMMON. Each coowner or tenant in common of undivided realty has the same rights therein as the others; he may use and enjoy the same without other limitation except that he must not prejudice the rights of his coowners, but until a division is effected, the respective parts belonging to each can not be determined; each coowner exercises joint dominion and is entitled to joint use. 2. ID.; ID.; ID; RENT BY ONE COOWNER. For the use and enjoyment of a particular portion of the lower part of a house, not used as living quarters, a coowner must, in strict justice, pay rent, in like manner as other people pay for similar space in the house; he has no right to the free use and enjoyment of such space which, if rented to a third party, would produce income. 3. ID.; ID.; ID.; REPAIRS AND IMPROVEMENT; INTEREST. Until a cause instituted to determine the liability of the rest of the coowners for repairs and improvements made by one of their number is finally decided and the amount due is fixed, the persons alleged to be liable can not be considered in default as to interest, because interest is only due from the date of the decision fixing the principal liability. (Supreme court of Spain, April 24, 1867, November 19, 1869, November 22, 1901, in connection with arts. 1108-1110 of the Civil Code.) 4. ID.; ID.; ID.; VOLUNTARY ADMINISTRATOR; COMPENSATION. To an administrator or voluntary manager of property belonging to his wife and another, both coowners, the property being undivided, the law does not conceded any remuneration, without prejudice to his right to be reimbursed for any necessary and useful expenditures in connection with the property and for any damages he may have suffered thereby. 5. ID.; ID.; ID.; RIGHT TO DEMAND VALUATION BEFORE DIVISION OR SALE. Any one of the coowners of undivided property about to be divided or to be sold in consequence of a mutual petition, has the right to ask that the property be valued by experts, a valuation which would not be prejudicial but rather beneficial to all.

DECISION Vigan;

valued at 60.00 5. A parcel of rice land in the pueblo of Santa Lucia; 86.00 6. Three parcels of land in the pueblo of Candon; valued at 150.00 Total 7,896.00 That, on or about the first months of the year 1888, the defendants, without judicial authorization, nor friendly or extrajudicial agreement, took upon themselves the administration and enjoyment of the said properties and collected the rents, fruits, and products thereof, to the serious detriment of the plaintiffs' interest; that, notwithstanding the different and repeated demands extrajudicially made upon Matilde Ortiz to divide the aforementioned properties with the plaintiff Vicenta and to deliver to the latter the one-half of the same which rightly belonged to her, or the value thereof, together with one-half of the fruits and rents collected therefrom, the said defendant and her husband, the said defendant and her husband, the self-styled administrator of the properties mentioned, had been delaying the partition and delivery of the said properties by means of unkempt promises and other excuses; and that the plaintiffs, on account of the extraordinary delay in the delivery of one-half of said properties, or their value in cash, as the case might be, had suffered losses and damages in the sum of P8,000. Said counsel for the plaintiffs therefore asked that judgment be rendered by sentencing the defendants, Gaspar de Bartolome and Matilde Ortiz Felin de Bartolome, to restore and deliver to the plaintiffs one-half of the total value in cash, according to appraisal, of the undivided property specified, which one-half amounted approximately to P3,498, or, if deemed proper, to recognize the plaintiff Vicenta Ortiz to be vested with the full and absolute right of ownership to the said undivided one-half of the properties in question, as universal testamentary heir thereof together with the defendant Matilde Ortiz, to indemnify the plaintiffs in the sum of P8,000, for losses and damages, and to pay the costs. Counsel for the defendants, in his answer denied the facts alleged in paragraphs 1, 4, 6, 7 and 8 thereof, inasmuch as, upon the death of the litigating sisters' brother Manuel, their mother, who was still living, was his heir by force of law, and the defendants had never refused to give to the plaintiff Vicenta Ortiz her share of the said properties; and stated that he admitted the facts alleged in paragraph 2, provided it be understood, however, that the surname of the

defendant's mother was Felin, and not Felix, and that Miguel Ortiz died in Spain, and not in Vigan; that he also admitted paragraph 3 of the complaint, with the difference that the said surname should be Felin, and likewise paragraph 5, except the part thereof relating to the personal property and the jewelry, since the latter had not yet been divided; that the said jewelry was in the possession of the plaintiffs and consisted of: one Lozada gold chronometer watch with a chain in the form of a bridle curb and a watch charm consisting of the engraving of a postage stamp on a stone mounted in gold and bearing the initials M.O., a pair of cuff buttons made of gold coins, four small gold buttons, two finger rings, another with the initials M.O., and a gold bracelet; and that the defendants were willing to deliver to the plaintiffs, in conformity with petition, one-half of the total value in cash, according to appraisement, of the undivided real properties specified in paragraph 5, which half amounted to P3,948. In a special defense said counsel alleged that the defendant had never refused to divide the said property and had in fact several years before solicited the partition of the same; that, from 1886 to 1901, inclusive, there was collected from the property on Calle Escolta the sum of 288 pesos, besides a few other small amounts derived from other sources, which were delivered to the plaintiffs with other larger amounts, in 1891, and from the property on Calle Washington, called La Quinta, 990.95 pesos, which proceeds, added together, made a total of 1,278.95 pesos, saving error or omission; that, between the years abovementioned, 765.38 pesos were spent on the house situated on Calle Escolta, and on that on Calle Washington, La Quinta, 376.33, which made a total of 1,141.71, saving error or omission; that, in 1897, the work of reconstruction was begun of the house on Calle Escolta, which had been destroyed by an earthquake, which work was not finished until 1903 and required an expenditure on the part of the defendant Matilde Ortiz, of 5,091.52 pesos; that all the collections made up to August 1,1905, including the rent from the stores, amounted to only P3,654.15, and the expenses to P6,252.32, there being, consequently, a balance of P2,598.18, which, divided between the sisters, the plaintiff and the defendant, would make the latter's share P1,299.08; that, as shown by the papers kept by the plaintiffs, in the year 1891 the defendant Bartolome presented to the plaintiffs a statement in settlement of accounts, and delivered to the person duly authorized by the latter for the purpose, the sum of P2,606.29, which the said settlement showed was owing his principals, from various sources; that, the defendant Bartolome having been the administrator of the undivided property claimed by the plaintiffs, the latter were owing the former the legal remuneration of the percentage allowed by law for administration; and that the defendants were willing to pay the sum of P3,948, one-half of the total value of the said properties, deducting therefrom the amount found to be owing them by the plaintiffs, and asked that the judgment be rendered in their favor to enable them to recover from the latter that amount, together with the costs and expenses of the suit.

The defendants, in their counterclaim, reported each and all of the allegations contained in each of the paragraphs of section 10 of their answer; that the plaintiffs were obliged to pay to the administrator of the said property the remuneration allowed him by law; that, as the revenues collected by the defendants amounted to no more than P3,654.15, and the expenditures incurred by them, to P6,252.32, it followed that the plaintiffs owed the defendants P1,299.08, that is, one-half of the difference between the amount collected from and that expended on the properties, and asked that judgment be therefore rendered in their behalf to enable them to collect this sum from the plaintiffs, Ricardo Pardell and Vicenta Ortiz, with legal interest thereon from December 7, 1904, the date when the accounts were rendered, together with the sums to which the defendant Bartolome was entitled for the administration of the undivided properties in question. By a written motion of August 21, 1905, counsel for the plaintiffs requested permission to amend the complaint by inserting immediately after the words "or respective appraisal," fifth line of paragraph 5, the phrased "in cash in accordance with the assessed value," and likewise further to amend the same, in paragraph 6 thereof, by substituting the following words in lieu of the petition for the remedy sought: "By reason of all the foregoing, I beg the court to be pleased to render judgment by sentencing the defendants, Gaspar de Bartolome and Matilde Ortiz Felin de Bartolome, to restore and deliver to the plaintiffs an exact one-half of the total value of the undivided properties described in the complaint, such value to be ascertained by the expert appraisal of two competent persons, one of whom shall be appointed by the plaintiffs and the other by the defendants, and, in case of disagreement between these two appointees such value shall be determined by a third expert appraiser appointed by the court, or, in a proper case, by the price offered at public auction; or, in lieu thereof, it is requested that the court recognize the plaintiff, Vicenta Ortiz, to be vested with a full and absolute right to an undivided one-half of the said properties; furthermore, it is prayed that the plaintiffs be awarded an indemnity of P8,000 for losses and damages, and the costs." Notwithstanding the opposition of the defendants, the said defendants were allowed a period of three days within which to present a new answer. An exception was taken to this ruling. The proper proceedings were had with reference to the valuation of the properties concerned in the division sought and incidental issues were raised relative to the partition of some of them and their award to one or the other of the parties. Due consideration was taken of the averments and statements of both parties who agreed between themselves, before the court, that any of them might at any time acquire, at the valuation fixed by the expert judicial appraiser, any of the properties in question, there being none in existence excluded by the litigants.

The court, therefore, by order of December 28, 1905, ruled that the plaintiffs were entitled to acquire, at the valuation determined by the said expert appraiser, the building known as La Quinta, the lot on which it stands and the warehouses and other improvements comprised within the inclosed land, and the seed lands situated in the pueblos of Vigan and Santa Lucia; and that the defendants were likewise entitled to acquire the house on Calle Escolta, the lot on Calle Magallanes, and the three parcels of land situated in the pueblo of Candon. After this partition had been made, counsel for the defendants, by a writing of March 8, 1908, set forth: That, having petitioned for the appraisement of the properties in question for the purpose of their partition, it was not to be understood that he desisted from the exception duly entered to the ruling made in the matter of the amendment to the complaint; that the properties retained by the defendants were valued at P9,310, and those retained by the plaintiffs, at P2,885, one-half of which amounts each party had to deliver to the other, as they were pro indiviso properties; that, therefore, the defendants had to pay the plaintiffs the sum of P3,212.50, after deducting the amount which the plaintiffs were obliged to deliver to the defendants, as one-half of the price of the properties retained by the former; that, notwithstanding that the amount of the counterclaim for the expenses incurred in the reconstruction of the pro indiviso property should be deducted from the sum which the defendants had to pay the plaintiffs, the former, for the purpose of bringing the matter of the partition to a close, would deliver to the latter, immediately upon the signing of the instrument of purchase and sale, the sum of P3,212.50, which was one-half of the value of the properties allotted to the defendants; such delivery, however, was not to be understood as a renouncement of the said counterclaim, but only as a means for the final termination of the pro indiviso status of the property. The case having been heard, the court, on October 5, 1907, rendered judgment holding that the revenues and the expenses were compensated by the residence enjoyed by the defendant party, that no losses or damages were either caused or suffered, nor likewise any other expense besides those aforementioned, and absolved the defendants from the complaint and the plaintiffs from the counterclaim, with no special finding as to costs. An exception was taken to this judgment by counsel for the defendants who moved for a new trial on the grounds that the evidence presented did not warrant the judgment rendered and that the latter was contrary to law. This motion was denied, exception whereto was taken by said counsel, who filed the proper bill of exceptions, and the same was approved and forwarded to the clerk of this court, with a transcript of the evidence. Both of the litigating sisters assented to a partition by halves of the property left in her will by their mother at her death; in fact, during the course of this suit, proceedings were had, in accordance with the agreement made, for the division between them of the said hereditary property of common ownership,

which division was recognized and approved in the findings of the trial court, as shown by the judgment appealed from. The issues raised by the parties, aside from the said division made during the trial, and which have been submitted to this court for decision, concern: (1) The indemnity claimed for losses and damages, which the plaintiffs allege amount to P8,000, in addition to the rents which should have been derived from the house on Calle Escolta, Vigan; (2) the payment by the plaintiffs to the defendants of the sum of P1,299.08, demanded by way of counterclaim, together with legal interest thereon from December 7, 1904; (3) the payment to the husband of the defendant Matilde Ortiz, of a percentage claimed to be due him as the administrator of the property of common ownership; (4) the division of certain jewelry in the possession of the plaintiff Vicenta Ortiz; and (5) the petition that the amendment be held to have been improperly admitted, which was made by the plaintiffs in their written motion of August 21, 1905, against the opposition of the defendants, through which admission the latter were obliged to pay the former P910.50. Before entering upon an explanation of the propriety or impropriety of the claims made by both parties, it is indispensable to state that the trial judge, in absolving the defendants from the complaint, held that they had not caused losses and damages to the plaintiffs, and that the revenues and the expenses were compensated, in view of the fact that the defendants had been living for several years in the Calle Escolta house, which was pro indiviso property of joint ownership. By this finding absolving the defendants from the complaint, and which was acquiesced in by the plaintiffs who made no appeal therefrom, the first issue has been decided which was raised by the plaintiffs, concerning the indemnity for losses and damages, wherein are comprised the rents which should have been obtained from the upper story of the said house during the time it was occupied by the defendants, Matilde Ortiz and her husband, Gaspar de Bartolome. Notwithstanding the acquiescence on the part of the plaintiffs, assenting to the said finding whereby the defendants were absolved from the complaint, yet as such absolution is based on the compensation established in the judgment of the trial court, between the amounts which each party is entitled to claim from the other, it is imperative to determine whether the defendant Matilde Ortiz, as coowner of the house on Calle Escolta, was entitled, with her husband, to reside therein, without paying to her coowner, Vicenta Ortiz, who, during the greater part of the time, lived with her husband abroad, one-half of the rents which the upper story would have produced, had it been rented to a stranger. Article 394 of the Civil Code prescribes: "Each coowner may use the things owned in common, provided he uses them in accordance with their object and in such

manner as not to injure the interests of the community nor prevent the coowners from utilizing them according to their rights." Matilde Ortiz and her husband occupied the upper story, designed for use as a dwelling, in the house of joint ownership; but the record shows no proof that, by so doing, the said Matilde occasioned any detriment to the interests of the community property, nor that she prevented her sister Vicenta from utilizing the said upper story according to her rights. It is to be noted that the stores of the lower floor were rented and an accounting of the rents was duly made to the plaintiffs. Each coowner of realty held pro indiviso exercises his rights over the whole property and may use and enjoy the same with no other limitation than that he shall not injure the interests of his coowners, for the reason that, until a division be made, the respective part of each holder can not be determined and every one of the coowners exercises together with his other coparticipants, joint ownership over the pro indiviso property, in addition to his use and enjoyment of the same. As the hereditary properties of the joint ownership of the two sisters, Vicenta Ortiz, plaintiff, and Matilde Ortiz, defendant, were situated in the Province of Ilocos Sur, and were in the care of the last named, assisted by her husband, while the plaintiff Vicenta with her husband was residing outside of the said province the greater part of the time between 1885 and 1905, when she left these Islands for Spain, it is not at all strange that delays and difficulties should have attended the efforts made to collect the rents and proceeds from the property held in common and to obtain a partition of the latter, especially during several years when, owing to the insurrection, the country was in a turmoil; and for this reason, aside from that founded on the right of coownership of the defendants, who took upon themselves the administration and care of the property of joint tenancy for purposes of their preservation and improvement, these latter are not obliged to pay to the plaintiff Vicenta one-half of the rents which might have been derived from the upper story of the said house on Calle Escolta, and, much less, because one of the living rooms and the storeroom thereof were used for the storage of some belongings and effects of common ownership between the litigants. The defendant Matilde, therefore, in occupying with her husband the upper floor of the said house, did not injure the interests of her coowner, her sister Vicenta, nor did she prevent the latter from living therein, but merely exercised a legitimate right pertaining to her as a coowner of the property. Notwithstanding the above statements relative to the joint-ownership rights which entitled the defendants to live in the upper story of the said house, yet, in view of the fact that the record shows it to have been proved that the defendant Matilde's husband, Gaspar de Bartolome, occupied for four years a room or a part of the lower floor of the same house on Calle Escolta, using it as an office for the

justice of the peace, a position which he held in the capital of that province, strict justice requires that he pay his sister-in-law, the plaintiff, one-half of the monthly rent which the said quarters could have produced, had they been leased to another person. The amount of such monthly rental is fixed at P16 in appearance with the evidence shown in the record. This conclusion as to Bartolome's liability results from the fact that, even as the husband of the defendant coowner of the property, he had no right to occupy and use gratuitously the said part of the lower floor of the house in question, where he lived with his wife, to the detriment of the plaintiff Vicenta who did not receive one-half of the rent which those quarters could and should have produced, had they been occupied by a stranger, in the same manner that rent was obtained from the rooms on the lower floor that were used as stores. Therefore, the defendant Bartolome must pay to the plaintiff Vicenta P384, that is, one-half of P768, the total amount of the rents which should have been obtained during four years from the quarters occupied as an office by the justice of the peace of Vigan. With respect to the second question submitted for decision to this court, relative to the payment of the sum demanded as a counterclaim, it was admitted and proved in the present case that, as a result of a serious earthquake on August 15, 1897, the said house on Calle Escolta was left in ruins and uninhabitable, and that, for its reconstruction or repair, the defendants had to expend the sum of P6,252.32. This expenditure, notwithstanding that it was impugned, during the trial, by the plaintiffs, was duly proved by the evidence presented by the defendants. Evidence, unsuccessfully rebutted, was also introduced which proved that the rents produced by all the rural and urban properties of common ownership amounted, up to August 1, 1905, to the sum of P3,654.15 which, being applied toward the cost of the repair work on the said house, leaves a balance of P2,598.17, the amount actually advanced by the defendants, for the rents collected by them were not sufficient for the termination of all the work undertaken on the said building, necessary for its complete repair and to replace it in a habitable condition. It is therefore lawful and just that the plaintiff Vicenta Ortiz, who was willing to sell to her sister Matilde for P1,500, her share in the house in question, when it was in a ruinous state, should pay the defendants one-half of the amount expended in the said repair work, since the building after reconstruction was worth P9,000, according to expert appraisal. Consequently, the counterclaim made by the defendants for the payment to them of the sum of P1,299.08, is a proper demand, though from this sum a reduction must be made of P384, the amount of one-half of the rents which should have been collected for the use of the quarters occupied by the justice of the peace, the payment of which is incumbent upon the husband of the defendant Matilde, as aforesaid, and the balance remaining, P915.08, is the amount which the plaintiff Vicenta must pay to the defendants. The defendants claim to be entitled to the collection of legal interest on the amount of the counterclaim, from December 7, 1904. This contention can not

be sustained, inasmuch as, until this suit is finally decided, it could not be known whether the plaintiffs would or would not be obliged to pay any sum whatever in reimbursement of expenses incurred by the plaintiffs in the repair work on the said house on Calle Escolta, whether or not the defendants in turn, were entitled to collect any such amount, and finally what the net sum would be which the plaintiffs might have to pay as reimbursement for one-half of the expenditures made by the defendants. Until final disposal of the case, no such net sum can be determined, nor until then can the debtor be deemed to be in arrears. In order that there be an obligation to pay legal interest in connection with a matter at issue between the parties, it must be declared in a judicial decision from what date the interest will be due on the principal concerned in the suit. This rule has been established by the decisions of the supreme court of Spain, in reference to articles 1108, 1109, and 1110 of the Civil Code, rendered on April 24, 1867, November 19, 1869, and February 22, 1901. With regard to the percentage, as remuneration claimed by the husband of the defendant Matilde for his administration of the property of common ownership, inasmuch as no stipulation whatever was made in the matter by and between him and his sister-in-law, the said defendant, the claimant is not entitled to the payment of any remuneration whatsoever. Of his own accord and as an officious manager, he administered the said pro indiviso property, one-half of which belonged to his wife who held it in joint tenancy, with his sister-in-law, and the law does not allow him any compensation as such voluntary administrator. He is merely entitled to a reimbursement for such actual and necessary expenditures as he may have made on the undivided properties and an indemnity for the damages he may have suffered while acting in that capacity, since at all events it was his duty to care for and preserve the said property half of which belonged to his wife; and in exchange for the trouble and labor occasioned him by the administration of his sister-in-law's half of the said property, he with his wife resided in the upper story of the house aforementioned, without payment of one-half of the rents said quarters might have produced had they been leased to another person. With respect to the division of the certain jewelry, petitioned for by the defendants and appellants only in their brief in this appeal, the record of the proceedings in the lower court does not show that the allegation made by the plaintiff Vicenta is not true, to the effect that the deceased mother of the litigant sisters disposed of this jewelry during her lifetime, because, had she not done so, the will made by the said deceased would have been exhibited in which the said jewelry would have been mentioned, at least it would have been proved that the articles in question came into the possession of the plaintiff Vicenta without the expressed desire and the consent of the deceased mother of the said sisters, for the gift of this jewelry was previously assailed in the courts, without success; therefore, and in view of its inconsiderable value, there is no reason for holding that the said gift was not made.

As regards the collection of the sum of P910.50, which is the difference between the assessed value of the undivided real properties and the price of the same as determined by the judicial expert appraiser, it is shown by the record that the ruling of the trial judge admitting the amendment to the original complaint, is in accord with the law and principles of justice, for the reason that any of the coowners of a pro indiviso property, subject to division or sale, is entitled to petition for its valuation is not prejudicial to any of the joint owners, but is beneficial to their interests, considering that, as a general rule, the assessed value of a building or a parcel of realty is less than the actual real value of the property, and this being understood by the defendants, they appointed an expert appraiser to determine, in conjunction with the one selected by the plaintiffs, the value of the properties of joint ownership. These two experts took part in the later proceedings of the suit until finally, and during the course of the latter, the litigating parties agreed to an amicable division of the pro indiviso hereditary property, in accordance with the price fixed by the judicial expert appraiser appointed as a third party, in view of the disagreement between and nonconformity of the appraisers chosen by the litigants. Therefore it is improper now to claim a right to the collection of the said sum, the difference between the assessed value and that fixed by the judicial expert appraiser for the reason that the increase in price, as determined by this latter appraisal, redounded to the benefit of both parties. In consideration of the foregoing, whereby the errors assigned to the lower court have been duly refuted, it is our opinion that, with a partial reversal of the judgment appealed from, in so far as it absolves the plaintiffs from the counterclaim presented by the defendants, we should and hereby do sentence the plaintiffs to the payment of the sum of P915.08, the balance of the sum claimed by the defendants as a balance of the one-half of the amount which the defendants advanced for the reconstruction or repair of the Calle Escolta house, after deducting from the total of such sum claimed by the latter the amount of P384 which Gaspar de Bartolome, the husband of the defendant Matilde, should have paid as one-half of the rents due for his occupation of the quarters on the lower floor of the said house as an office for the justice of the peace court of Vigan; and we further find: (1) That the defendants are not obliged to pay one-half of the rents which could have been obtained from the upper story of the said house; (2) that the plaintiffs can not be compelled to pay legal interest from December 7, 1904, on the sum expended in the reconstruction of the aforementioned house, but only the interest fixed by law, at the rate of per cent per annum, from the date of the judgment to be rendered in accordance with this decision; (3) that the husband of the defendant Matilde Ortiz is not entitled to any remuneration for the administration of the pro indiviso property belonging to both parties; (4) that, neither is he entitled to collect from the plaintiffs the sum of P910.50, the difference between the assessed valuation and the price set by the expert appraisal solicited by the plaintiffs in their

amendment to the complaint; and, (5) that no partition shall be made of certain jewelry aforementioned now in the possession of the plaintiff Vicenta Ortiz. The said judgment, as relates to the points appealed, is affirmed, in so far as its findings agree with those of this decision, and is reversed, in so far as they do not. No special finding is made regarding the costs of both instances. So ordered.

FIRST DIVISION [G.R. No. 161916. January 20, 2006.] ARNELITO ADLAWAN, petitioner, vs. EMETERIO M. ADLAWAN and NARCISA M. ADLAWAN, respondents.

Neri & Associates Law Firm for petitioner. Alo & Velasquez Law Office for respondents.

SYLLABUS 1.REMEDIAL LAW; CIVIL PROCEDURE; PARTIES; PETITIONER HAS NO AUTHORITY TO INSTITUTE EJECTMENT CASE AS SOLE OWNER OF SUBJECT PROPERTY CO-OWNED WITH OTHER HEIRS; CASE AT BAR. The decisive issue to be resolved is whether or not petitioner can validly maintain the instant case for ejectment. Petitioner averred that he is an acknowledged illegitimate son and the sole heir of Dominador. He in fact executed an affidavit adjudicating to himself the controverted property. In ruling for the petitioner, the RTC held that the questioned January 31, 1962 deed of sale validly transferred title to Dominador and that petitioner is his acknowledged illegitimate son who inherited ownership of the questioned lot. The Court notes, however, that the RTC lost sight of the fact that the theory of succession invoked by petitioner would end up proving that he is not the sole owner of Lot 7226. This is so because Dominador was survived not only by petitioner but also by his legal wife, Graciana, who died 10 years after the demise of Dominador on May 28, 1987. By intestate succession, Graciana and petitioner became co-owners of Lot 7226. The death of Graciana on May 6, 1997, did not make petitioner the absolute owner of Lot 7226 because the share of Graciana passed to her relatives by consanguinity and not to petitioner with whom she had no blood relations. The Court of Appeals thus correctly held that petitioner has no authority to institute the instant action as the sole owner of Lot 7226.

2.CIVIL LAW; PROPERTY; CO-OWNERSHIP; THAT ANY ONE OF CO-OWNERS MAY BRING ACTION FOR EJECTMENT; NOT PROPER WHERE SUIT FILED FOR THE BENEFIT OF ONE CO-OWNER ALONE WHO CLAIMS SOLE OWNERSHIP OF THE SUBJECT PROPERTY; CASE AT BAR. Petitioner contends that even granting that he has co-owners over Lot 7226, he can on his own file the instant case pursuant to Article 487 of the Civil Code which provides: ART. 487. Any one of the co-owners may bring an action in ejectment. This article covers all kinds of actions for the recovery of possession. Article 487 includes forcible entry and unlawful detainer (action interdictal), recovery of possession (action publiciana), and recovery of ownership (action de reivindicacion). A co-owner may bring such an action without the necessity of joining all the other co-owners as co-plaintiffs because the suit is presumed to have been filed to benefit his co-owners. It should be stressed, however, that where the suit is for the benefit of the plaintiff alone who claims to be the sole owner and entitled to the possession of the litigated property, the action should be dismissed. The renowned civilist, Professor Arturo M. Tolentino, explained . . . A co-owner may bring such an action, without the necessity of joining all the other coowners as co-plaintiffs, because the suit is deemed to be instituted for the benefit of all. If the action is for the benefit of the plaintiff alone, such that he claims possession for himself and not for the co-ownership, the action will not prosper. In the instant case, it is not disputed that petitioner brought the suit for unlawful detainer in his name alone and for his own benefit to the exclusion of the heirs of Graciana as he even executed an affidavit of self-adjudication over the disputed property. It is clear therefore that petitioner cannot validly maintain the instant action considering that he does not recognize the co-ownership that necessarily flows from his theory of succession to the property of his father, Dominador. In the same vein, there is no merit in petitioner's claim that he has the legal personality to file the present unlawful detainer suit because the ejectment of respondents would benefit not only him but also his alleged coowners. However, petitioner forgets that he filed the instant case to acquire possession of the property and to recover damages. If granted, he alone will gain possession of the lot and benefit from the proceeds of the award of damages to the exclusion of the heirs of Graciana. Hence, petitioner cannot successfully capitalize on the alleged benefit to his co-owners. Incidentally, it should be pointed out that in default of the said heirs of Graciana, whom petitioner labeled as "fictitious heirs," the State will inherit her share and will thus be petitioner's co-owner entitled to possession and enjoyment of the property.

Assailed in this petition for review is the September 23, 2003 Decision 1 of the Court of Appeals in CA-G.R. SP No. 74921 which set aside the September 13, 2002 Decision 2 of the Regional Trial Court (RTC) of Cebu City, Branch 7, in Civil Case No. CEB-27806, and reinstated the February 12, 2002 Judgment 3 of the Municipal Trial Court (MTC) of Minglanilla, Metro Cebu, in Civil Case No. 392, dismissing petitioner Arnelito Adlawan's unlawful detainer suit against respondents Emeterio and Narcisa Adlawan. Likewise questioned is the January 8, 2004 Resolution 4 of the Court of Appeals which denied petitioner' s motion for reconsideration. The instant ejectment suit stemmed from the parties' dispute over Lot 7226 and the house built thereon, covered by Transfer Certificate of Title No. 8842, 5 registered in the name of the late Dominador Adlawan and located at Barrio Lipata, Municipality of Minglanilla, Cebu. In his complaint, petitioner claimed that he is an acknowledged illegitimate child 6 of Dominador who died on May 28, 1987 without any other issue. Claiming to be the sole heir of Dominador, he executed an affidavit adjudicating to himself Lot 7226 and the house built thereon. 7 Out of respect and generosity to respondents who are the siblings of his father, he granted their plea to occupy the subject property provided they would vacate the same should his need for the property arise. Sometime in January 1999, he verbally requested respondents to vacate the house and lot, but they refused and filed instead an action for quieting of title 8 with the RTC. Finally, upon respondents' refusal to heed the last demand letter to vacate dated August 2, 2000, petitioner filed the instant case on August 9, 2000. 9 On the other hand, respondents Narcisa and Emeterio, 70 and 59 years of age, respectively, 10 denied that they begged petitioner to allow them to stay on the questioned property and stressed that they have been occupying Lot 7226 and the house standing thereon since birth. They alleged that Lot 7226 was originally registered in the name of their deceased father, Ramon Adlawan 11 and the ancestral house standing thereon was owned by Ramon and their mother, Oligia Maacap Adlawan. The spouses had nine 12 children including the late Dominador and herein surviving respondents Emeterio and Narcisa. During the lifetime of their parents and deceased siblings, all of them lived on the said property. Dominador and his wife, Graciana Ramas Adlawan, who died without issue, also occupied the same. 13 Petitioner, on the other hand, is a stranger who never had possession of Lot 7226. Sometime in 1961, spouses Ramon and Oligia needed money to finance the renovation of their house. Since they were not qualified to obtain a loan, they transferred ownership of Lot 7226 in the name of their son Dominador who was the only one in the family who had a college education. By virtue of a January 31, 1962 simulated deed of sale, 14 a title was issued to Dominador which enabled him to secure a loan with Lot 7226 as collateral. Notwithstanding the execution of the simulated deed, Dominador, then single, never disputed his parents' ownership of the lot. He and his wife, Graciana,

DECISION

YNARES-SANTIAGO, J p:

did not disturb respondents' possession of the property until they died on May 28, 1987 and May 6, 1997, respectively. ScCIaA Respondents also contended that Dominador's signature at the back of petitioner's birth certificate was forged, hence, the latter is not an heir of Dominador and has no right to claim ownership of Lot 7226. 15 They argued that even if petitioner is indeed Dominador's acknowledged illegitimate son, his right to succeed is doubtful because Dominador was survived by his wife, Graciana. 16 On February 12, 2002, the MTC dismissed the complaint holding that the establishment of petitioner's filiation and the settlement of the estate of Dominador are conditions precedent to the accrual of petitioner's action for ejectment. It added that since Dominador was survived by his wife, Graciana, who died 10 years thereafter, her legal heirs are also entitled to their share in Lot 7226. The dispositive portion thereof, reads: In View of the foregoing, for failure to prove by preponderance of evidence, the plaintiff's cause of action, the above-entitled case is hereby Ordered DISMISSED. SO ORDERED. 17 On appeal by petitioner, the RTC reversed the decision of the MTC holding that the title of Dominador over Lot 7226 cannot be collaterally attacked. It thus ordered respondents to turn over possession of the controverted lot to petitioner and to pay compensation for the use and occupation of the premises. The decretal portion thereof, provides: Wherefore, the Judgment, dated February 12, 2002, of the Municipal Trial Court of Minglanilla, Cebu, in Civil Case No. 392, is reversed. Defendants-appellees are directed to restore to plaintiffappellant possession of Lot 7226 and the house thereon, and to pay plaintiff-appellant, beginning in August 2000, compensation for their use and occupation of the property in the amount of P500.00 a month. So ordered. 18 Meanwhile, the RTC granted petitioner's motion for execution pending appeal 19 which was opposed by the alleged nephew and nieces of Graciana in their motion for leave to intervene and to file an answer in intervention. 20 They contended that as heirs of Graciana, they have a share in Lot 7226 and that intervention is necessary to protect

their right over the property. In addition, they declared that as co-owners of the property, they are allowing respondents to stay in Lot 7226 until a formal partition of the property is made. The RTC denied the motion for leave to intervene. 21 It, however, recalled the order granting the execution pending appeal having lost jurisdiction over the case in view of the petition filed by respondents with the Court of Appeals. 22 On September 23, 2003, the Court of Appeals set aside the decision of the RTC and reinstated the judgment of the MTC. It ratiocinated that petitioner and the heirs of Graciana are co-owners of Lot 7226. As such, petitioner cannot eject respondents from the property via an unlawful detainer suit filed in his own name and as the sole owner of the property. Thus WHEEFORE, premises considered, the appealed Decision dated September 13, 2002 of the Regional Trial Court of Cebu City, Branch 7, in Civil Case No. CEB-27806 is REVERSED and SET ASIDE, and the Judgment dated February 12, 2002 of the Municipal Trial Court of Minglanilla, Metro Cebu, in Civil Case No. 392 is REINSTATED. Costs against the respondent. SO ORDERED. 23 Petitioner's motion for reconsideration was denied. Hence, the instant petition. The decisive issue to be resolved is whether or not petitioner can validly maintain the instant case for ejectment. Petitioner averred that he is an acknowledged illegitimate son and the sole heir of Dominador. He in fact executed an affidavit adjudicating to himself the controverted property. In ruling for the petitioner, the RTC held that the questioned January 31, 1962 deed of sale validly transferred title to Dominador and that petitioner is his acknowledged illegitimate son who inherited ownership of the questioned lot. The Court notes, however, that the RTC lost sight of the fact that the theory of succession invoked by petitioner would end up proving that he is not the sole owner of Lot 7226. This is so because Dominador was survived not only by petitioner but also by his legal wife, Graciana, who died 10 years after the demise of Dominador on May 28, 1987. 24 By intestate succession, Graciana and petitioner became co-owners of Lot 7226. 25 The death of Graciana on May 6, 1997, did not make petitioner the absolute owner of Lot 7226 because the share of Graciana passed to her relatives by consanguinity and not to petitioner with whom she had no blood relations. The Court of Appeals thus correctly

held that petitioner has no authority to institute the instant action as the sole owner of Lot 7226. HaIATC Petitioner contends that even granting that he has co-owners over Lot 7226, he can on his own file the instant case pursuant to Article 487 of the Civil Code which provides: ART. 487.Any one of the co-owners may bring an action in ejectment. This article covers all kinds of actions for the recovery of possession. Article 487 includes forcible entry and unlawful detainer (accion interdictal), recovery of possession (accion publiciana), and recovery of ownership (accion de reivindicacion). 26 A co-owner may bring such an action without the necessity of joining all the other co-owners as coplaintiffs because the suit is presumed to have been filed to benefit his co-owners. It should be stressed, however, that where the suit is for the benefit of the plaintiff alone who claims to be the sole owner and entitled to the possession of the litigated property, the action should be dismissed. 27 The renowned civilist, Professor Arturo M. Tolentino, explained . . . A co-owner may bring such an action, without the necessity of joining all the other co-owners as co-plaintiffs, because the suit is deemed to be instituted for the benefit of all. If the action is for the benefit of the plaintiff alone, such that he claims possession for himself and not for the co-ownership, the action will not prosper . (Emphasis added) 28 In Baloloy v. Hular, 29 respondent filed a complaint for quieting of title claiming exclusive ownership of the property, but the evidence showed that respondent has coowners over the property. In dismissing the complaint for want of respondent's authority to file the case, the Court held that Under Article 487 of the New Civil Code, any of the co-owners may bring an action in ejectment. This article covers all kinds of actions for the recovery of possession, including an accion publiciana and a reinvidicatory action. A co-owner may bring such an action without the necessity of joining all the other co-owners as co-plaintiffs because the suit is deemed to be instituted for the benefit of all. Any judgment of the court in favor of the co-owner will benefit the others but if such judgment is adverse, the same cannot prejudice the rights of the unimpleaded co-owners. If the action is for the benefit of the plaintiff alone who claims to be the sole owner and

entitled to the possession thereof, the action will not prosper unless he impleads the other co-owners who are indispensable parties. In this case, the respondent alone filed the complaint, claiming sole ownership over the subject property and praying that he be declared the sole owner thereof. There is no proof that the other co-owners had waived their rights over the subject property or conveyed the same to the respondent or such co-owners were aware of the case in the trial court. The trial court rendered judgment declaring the respondent as the sole owner of the property and entitled to its possession, to the prejudice of the latter's siblings. Patently then, the decision of the trial court is erroneous. Under Section 7, Rule 3 of the Rules of Court, the respondent was mandated to implead his siblings, being co-owners of the property, as parties. The respondent failed to comply with the rule. It must, likewise, be stressed that the Republic of the Philippines is also an indispensable party as defendant because the respondent sought the nullification of OCT No. P-16540 which was issued based on Free Patent No. 384019. Unless the State is impleaded as partydefendant, any decision of the Court would not be binding on it. It has been held that the absence of an indispensable party in a case renders ineffective all the proceedings subsequent to the filing of the complaint including the judgment. The absence of the respondent's siblings, as parties, rendered all proceedings subsequent to the filing thereof, including the judgment of the court, ineffective for want of authority to act, not only as to the absent parties but even as to those present. 30 In the instant case, it is not disputed that petitioner brought the suit for unlawful detainer in his name alone and for his own benefit to the exclusion of the heirs of Graciana as he even executed an affidavit of self-adjudication over the disputed property. It is clear therefore that petitioner cannot validly maintain the instant action considering that he does not recognize the co-ownership that necessarily flows from his theory of succession to the property of his father, Dominador. In the same vein, there is no merit in petitioner's claim that he has the legal personality to file the present unlawful detainer suit because the ejectment of respondents would benefit not only him but also his alleged co-owners. However, petitioner forgets that he filed the instant case to acquire possession of the property and to recover damages. If granted, he alone will gain possession of the lot and benefit from the proceeds of the

award of damages to the exclusion of the heirs of Graciana. Hence, petitioner cannot successfully capitalize on the alleged benefit to his co-owners. Incidentally, it should be pointed out that in default of the said heirs of Graciana, whom petitioner labeled as "fictitious heirs," the State will inherit her share 31 and will thus be petitioner's coowner entitled to possession and enjoyment of the property. SaAcHE The present controversy should be differentiated from the cases where the Court upheld the right of a co-owner to file a suit pursuant to Article 487 of the Civil Code. In Resuena v. Court of Appeals, 32 and Sering v. Plazo, 33 the co-owners who filed the ejectment case did not represent themselves as the exclusive owner of the property. In Celino v. Heirs of Alejo and Teresa Santiago , 34 the complaint for quieting of title was brought in behalf of the co-owners precisely to recover lots owned in common. 35 Similarly in Vencilao v. Camarenta, et al., 36 the amended complaint specified that the plaintiff is one of the heirs who co-owns the controverted properties. In the foregoing cases, the plaintiff never disputed the existence of a co-ownership nor claimed to be the sole or exclusive owner of the litigated lot. A favorable decision therein would of course inure to the benefit not only of the plaintiff but to his coowners as well. The instant case, however, presents an entirely different backdrop as petitioner vigorously asserted absolute and sole ownership of the questioned lot. In his complaint, petitioner made the following allegations, to wit: 3.The plaintiff was the only son (illegitimate) and sole heir of the late DOMINADOR ADLAWAN who died intestate on 28 May 1987 without any other descendant nor ascendant . . . . xxx xxx xxx

Indeed, respondents' not less than four decade actual physical possession of the questioned ancestral house and lot deserves to be respected especially so that petitioner failed to show that he has the requisite personality and authority as co-owner to file the instant case. Justice dictates that respondents who are now in the twilight years of their life be granted possession of their ancestral property where their parents and siblings lived during their lifetime, and where they, will probably spend the remaining days of their life. WHEREFORE, the petition is DENIED. The September 23, 2003 Decision of the Court of Appeals in CA-G.R. SP No. 74921 which reinstated the February 12, 2002 Judgment of the Municipal Trial Court of Minglanilla, Metro Cebu, dismissing petitioner's complaint in Civil Case No. 392, and its January 8, 2004 Resolution, are AFFIRMED. SO ORDERED.

SECOND DIVISION [G.R. No. 128338. March 28, 2005.] TINING RESUENA, ALEJANDRA GARAY, LORNA RESUENA, ELEUTERIO RESUENA, EUTIQUIA ROSARIO and UNISIMA RESUENA, petitioners, vs. HON. COURT OF APPEALS, 11th DIVISION and JUANITO BORROMEO, SR., respondents.

DECISION 5.Being the only child/descendant and, therefore, sole heir of the deceased Dominador Adlawan, the plaintiff became the absolute owner, and automatically took POSSESSION, of the aforementioned house and lot. . . (Emphasis added) 37 Clearly, the said cases find no application here because petitioner's action operates as a complete repudiation of the existence of co-ownership and not in representation or recognition thereof. Dismissal of the complaint is therefore proper. As noted by Former Supreme Court Associate Justice Edgrado L. Paras "[i]t is understood, of course, that the action [under Article 487 of the Civil Code] is being instituted for all. Hence, if the coowner expressly states that he is bringing the case only for himself, the action should not be allowed to prosper." 38

TINGA, J p: This is a Rule 45 Petition for Review on Certiorari of the Decision 1 of the Court of Appeals affirming that of the Regional Trial Court (RTC) of Cebu, 2 which in turn reversed that of the Metropolitan Trial Court (mtc) of Talisay, Cebu. 3 The facts are as follows: Private respondent, the late Juanito Borromeo, Sr. 4 (hereinafter, respondent), is the coowner and overseer of certain parcels of land located in Pooc, Talisay, Cebu, designated as Lots Nos. 2587 and 2592 of the Talisay-Manglanilla Estate. Respondent owns six-

eighths (6/8) of Lot No. 2587 while the late spouses Inocencio Bascon and Basilisa Maneja (Spouses Bascon) own two-eighths (2/8) thereof. On the other hand, Lot No. 2592 is owned in common by respondent and the heirs of one Nicolas Maneja. However, the proportion of their undivided shares was not determined a quo. Prior to the institution of the present action, petitioners Tining Resuena, Alejandra Garay, Lorna Resuena, Eleuterio Resuena, and Unisima Resuena resided in the upper portion of Lot No. 2587, allegedly under the acquiescence of the Spouses Bascon and their heir, Andres Bascon. On the other hand, petitioner Eutiquia Rosario occupied a portion of Lot No. 2592, allegedly with the permission of the heirs of Nicolas Maneja, one of the original co-owners of Lot No. 2587. Respondent claims that all petitioners have occupied portions of the subject property by virtue of his own liberality. Respondent developed portions of Lots Nos. 2587 and 2592 occupied by him into a resort known as the Borromeo Beach Resort. In his desire to expand and extend the facilities of the resort that he established on the subject properties, respondent demanded that petitioners vacate the property. Petitioners, however, refused to vacate their homes. On 16 February 1994, respondent filed a Complaint 5 for ejectment with the MTC against the petitioners. After a summary proceeding, the MTC, in a Decision 6 dated 10 October 1994, found that Lots Nos. 2587 and 2592 were owned in common by respondent with other persons. The MTC ruled that respondent did not have a preferential right of possession over the portions occupied by petitioners, since Lots Nos. 2587 and 2592 were not yet partitioned nor the disputed portions assigned to respondent as his determinate share. Thus, the MTC held that respondent had no right to evict petitioners therefrom. Consequently, respondent's Complaint was dismissed. SIHCDA Notably, the MTC held that respondent and the spouses Bascon were the owners in common of Lot No. 2587 and their respective shares had not yet been determined by partition as proven by a testimony given by respondent in Civil Case No. R-14600, viz: Q. And the participation there of Inocencio Bascon is 2/8 of the said parcel of land? A. Yes sir. Q. And until the present that parcel of land is undivided?

A. It is not yet partitioned, but during the time of Basilisa Maneja we had already made some indications of the portions that we came to occupy. Q. That is the parcel of land where you have your beach resort? A. Yes, sir; and that was our agreement, verbally, that with respect to the portion of the land towards the sea-shore it will be my share and that portion of the land towards the upper part will be theirs." 7 On appeal, the RTC reversed the Decision of the MTC. It held that Article 487 of the Civil Code, which allows any one of the co-owners to bring an action in ejectment, may successfully be invoked by the respondent because, in a sense, a co-owner is the owner and possessor of the whole, and that the suit for ejectment is deemed to be instituted for the benefit of all co-owners. 8 The RTC also ruled that assuming petitioners were authorized to occupy a portion of the co-owned property, they could resume this occupation when the properties shall have been partitioned and allocated to the ones who gave them permission to reside therein. It thus held: WHEREFORE, judgment of the lower court is hereby reversed and the defendants are hereby directed to vacate the premises in question without prejudice to their going back to the land after partition shall have been effected by the coheirs and/or co-owners among themselves but to the specific portion or portions adjudicated to the person or persons who allegedly authorized them to occupy their portions by tolerance. 9 The Court of Appeals affirmed the Decision of the RTC; hence, this petition which involves the following assignment of errors: 10 1. That with grave abuse of discretion, amounting to excess of jurisdiction, the Honorable Eleventh Division of the Court of Appeals erred in NOT APPLYING and/or in NOT DECLARING private respondent Juanito Borromeo estopped in filing this ejectment case against the herein six (6) petitioners. 2. That with grave abuse of discretion, the Honorable Eleventh Division of the Court of Appeals erred in incorrectly applying the statute of frauds, considering that the verbal agreement entered into by and between spouses Inocencio Bascon and Basilisa Maneja

on the one hand and Juanito Borromeo on the other more than twenty (20) years ago today, was already an EXECUTED CONTRACT. 3. That with grave abuse of discretion, amounting to excess of jurisdiction, the Honorable Eleventh Division of the Court of Appeals erred in ignoring outright article 493 of the new Civil Code of the Philippines, considering that the six (6) petitioners are only ASSIGNEES, pure and simple, of co-owners spouses Ignacio Bascon and Basilisa Maneja and/or Andres Bascon, the adopted son of the said spouses. aITECD 4. That granting arguendo that the herein six (6) petitioners have to be ejected, the Eleventh Division of the Court of Appeals erred in NOT remanding this case to the court of origin for the reception of evidence for damages, pursuant to and in accordance with Art. 546, new Civil Code. The petition cannot prosper. At the outset it must be stated that petitioners ground their petition on respondent's testimony in Civil Case No. R-14600 that he had agreed with co-owner, Basilisa Maneja, on the portions they each were to occupy in Lot No. 2587 prior to the partition of the property. However, respondent's testimony and, consequently, the agreement alluded to therein pertains solely to Lot No. 2587 which, admittedly, all of petitioners occupy, save for Eutiquia Rosario who occupies Lot No. 2592. No argument was presented in this petition as regards the latter's claim. Having no basis to review Eutiquia Rosario's claim to be allowed to continue in her occupation of Lot No. 2592, this Court maintains the holding of the RTC on this matter, as affirmed by the Court of Appeals, that respondent has the right to eject petitioner Eutiquia Rosario from Lot No. 2592. With regard to the other five (5) petitioners, the Court notes that their first three assignments of errors are interrelated and built on each other. Petitioners allege that respondent's testimony in Civil Case No. R-14600, expressing that the upper two-eighths (2/8) portion of Lot No. 2587 would be occupied by Basilisa Maneja, constituting as it does a waiver of said portion, has estopped respondent from claiming the portion. Basilisa Maneja and her husband allegedly relied on this agreement when the spouses assigned the upper portion of Lot No. 2587 to petitioners. Moreover, petitioners claim that their occupation of the upper portion of Lot No. 2587 had consummated the verbal agreement between respondent and Basilisa Maneja and brought agreement beyond the purview of the Statute of Frauds.

A careful perusal of the foregoing issues reveals that petitioners assumed the following as proven facts: (1) respondent had indicated to Basilisa Maneja the portions they were to occupy in Lot No. 2587; and (2) the Spouses Bascon assigned to petitioners their portions of Lot No. 2587. By claiming these as the bases for their assignment of errors, petitioners in essence are raising questions of fact. 11 The issues raised by petitioners on the application of estoppel, statute of frauds, and the assignment of properties owned in common in their favor, while ostensibly raising questions of law, invite this Court to rule on questions of fact. This runs counter to the settled rule that only questions of law may be raised in a petition for review before the Court and the same must be distinctly set forth. 12 It is not the function of this Court to weigh anew the evidence already passed upon by the Court of Appeals for such evidence is deemed final and conclusive and may not be reviewed on appeal. A departure from the general rule may be warranted, among others, where the findings of fact of the Court of Appeals are contrary to the findings and conclusions of the trial court, or when the same is unsupported by the evidence on record. 13 In the instant case, the RTC and the Court of Appeals rendered judgment merely on questions of law as applied to the facts as determined by the MTC. Consequently this Court must proceed on the same set of facts without assuming, as petitioners have done, the veracity of claims which have been considered, but not accepted as facts, by the courts below. Guided by the foregoing, this Court finds in this case that filtered of the muddle from petitioners' assignment of errors, it is unmistakable that respondent has a right to eject the petitioners from Lot No. 2587. DaAETS Article 487 of the Civil Code, which provides simply that "[a]ny one of the co-owners may bring an action in ejectment," is a categorical and an unqualified authority in favor of respondent to evict petitioners from the portions of Lot No. 2587.

This provision is a departure from Palarca v. Baguisi, 14 which held that an action for ejectment must be brought by all the co-owners. Thus, a co-owner may bring an action to exercise and protect the rights of all. When the action is brought by one co-owner for the benefit of all, a favorable decision will benefit them; but an adverse decision cannot prejudice their rights. 15

Respondent's action for ejectment against petitioners is deemed to be instituted for the benefit of all co-owners of the property 16 since petitioners were not able to prove that they are authorized to occupy the same. Petitioners' lack of authority to occupy the properties, coupled with respondent's right under Article 487, clearly settles respondent's prerogative to eject petitioners from Lot No. 2587. Time and again, this Court has ruled that persons who occupy the land of another at the latter's tolerance or permission, without any contract between them, are necessarily bound by an implied promise that they will vacate the same upon demand, failing in which a summary action for ejectment is the proper remedy against them. 17 Petitioners pose the strange claim that respondent had estopped himself from filing an ejectment case against petitioners by his aforequoted testimony in Civil Case No. R14600. Such testimony is irrelevant to the case at bar, as it does nothing to strengthen the claim of petitioners that they had a right to occupy the properties. This testimony merely indicates that there might have been an agreement between the Spouses Bascon and Borromeo as to which of them would occupy what portion of Lot No. 2587. Yet this averment hardly establishes a definitive partition, or moreover, any right of petitioners to dwell in any portion of Lot No. 2587. Besides, "[e]stoppel is effective only as between the parties thereto or their successors in interest;" thus, only the spouses Bascon or their successors in interest may invoke such "estoppel." A stranger to a transaction is neither bound by, nor in a position to take advantage of, an estoppel arising therefrom. 18 For the same reason, it is of no moment whether indeed, as petitioners claim, there was a verbal contract between Basilisa Maneja and Borromeo when the latter indicated the portions they each were to occupy in Lot No. 2587. Such verbal contract, assuming there was one, does not detract from the fact that the common ownership over Lot No. 2587 remained inchoate and undivided, thus casting doubt and rendering purely speculative any claim that the Spouses Bascon somehow had the capacity to assign or transmit determinate portions of the property to petitioners. Thus, in order that the petition may acquire any whiff of merit, petitioners are obliged to establish a legal basis for their continued occupancy of the properties. The mere tolerance of one of the co-owners, assuming that there was such, does not suffice to establish such right. Tolerance in itself does not bear any legal fruit, and it can easily be supplanted by a sudden change of heart on the part of the owner. Petitioners have not adduced any convincing evidence that they have somehow become successors-ininterest of the Spouses Bascon, or any of the owners of Lot No. 2587. Indeed, there is no writing presented to evidence any claim of ownership or right to occupancy to the subject properties. There is no lease contract that would vest on

petitioners the right to stay on the property. As discussed by the Court of Appeals, 19 Article 1358 of the Civil Code provides that acts which have for their object the creation, transmission, modification or extinguishment of real rights over immovable property must appear in a public instrument. How then can this Court accept the claim of petitioners that they have a right to stay on the subject properties, absent any document which indubitably establishes such right? Assuming that there was any verbal agreement between petitioners and any of the owners of the subject lots, Article 1358 grants a coercive power to the parties by which they can reciprocally compel the documentation of the agreement. 20 Thus, the appellate court correctly appreciated the absence of any document or any occupancy right of petitioners as a negation of their claim that they were allowed by the Spouses Bascon to construct their houses thereon and to stay thereon until further notice. On this note, this Court will no longer belabor petitioners' allegation that their occupation of Lot No. 2587 is justified pursuant to the alleged but unproven permission of the Spouses Bascon. CTacSE All six (6) petitioners claim the right to be reimbursed "necessary expenses" for the cost of constructing their houses in accordance with Article 546 of the Civil Code. 21 It is well-settled that while the Article allows full reimbursement of useful improvements and retention of the premises until reimbursement is made, applies only to a possessor in good faith, i.e., one who builds on land with the belief that he is the owner thereof. Verily, persons whose occupation of a realty is by sheer tolerance of its owners are not possessors in good faith. 22 The lower courts have made a common factual finding that petitioners are occupying portions of Lots No. 2587 and 2592 by mere tolerance. Thus, petitioners have no right to get reimbursed for the expenses they incurred in erecting their houses thereon. WHEREFORE, premises considered, the Petition is DENIED and the Decision of the Court of Appeals AFFIRMED. Costs against petitioners. SO ORDERED.

THIRD DIVISION [G.R. No. 102900. October 2, 1997.] MARCELINO ARCELONA, TOMASA ARCELONA-CHIANG and RUTH ARCELONA, represented by their attorney-in-fact, ERLINDA PILE,

petitioners, vs. COURT OF APPEALS, REGIONAL TRIAL COURT OF DAGUPAN CITY, Branch XL, and MOISES FARNACIO, respondents.

Tumangan, Nagrampa & Partners for petitioners. Millora & Maningding Law Offices for private respondents.

grounds of fraud, accident, mistake and excusable negligence filed within sixty (60) days from the time petitioner learns of the judgment but not more than six (6) months from the entry thereof; second, a direct action to annul the judgment on the ground of extrinsic fraud; and third, a direct action for certiorari or collateral attack to annul a judgment that is void upon its face or void by virtue of its own recitals. Thus, Macabingkil did not preclude the setting aside of a decision that is patently void where mere inspection of the judgment is enough to demonstrate its nullity on grounds of want of jurisdiction or non-compliance with the due process of law. 2. ID.; JURISDICTION; ITS EXERCISE MUST STRICTLY COMPLY WITH LEGAL REQUISITES. Jurisdiction is conferred by law. Its exercise must strictly comply with the legal requisites; otherwise, a challenge on the ground of lack of jurisdiction may be brought up anytime. Such jurisdiction normally refers to jurisdiction over the subject. Ineluctably, a judgment rendered without jurisdiction over the subject matter is void. (Leonor vs. CA, 256 SCRA 69, April 2, 1996). 3. ID.; ID.; AS A RULE, IF A DEFENDANT HAS NOT BEEN SUMMONED, THE COURT ACQUIRES NO JURISDICTION OVER HIS PERSON AND THE JUDGMENT RENDERED AGAINST HIM IS NULL AND VOID. Courts acquire jurisdiction over a party plaintiff upon the filing of the complaint. On the other hand, jurisdiction over the person of a party defendant is assured upon the service of summons in the manner required by law or otherwise by his voluntary appearance. As a rule, if a defendant has not been summoned, the court acquires no jurisdiction over his person. and a personal judgment rendered against such defendant is null and void. A decision that is null and void for want of jurisdiction on the part of the trial court is not a decision in the contemplation of law and, hence, it can never become final .and executory. 4. ID.; ACTIONS; PARTIES IN CIVIL ACTION; INDISPENSABLE PARTIES; THEIR JOINDER IS A SINE QUA NON FOR THE EXERCISE OF JUDICIAL POWER. Rule 3, Section 7 of the Rules of Court, defines indispensable parties as parties-in-interest without whom there can be no final determination of an action. As such, they must be joined either as plaintiffs or as defendants. The general rule with reference to the making of parties in a civil action requires, of course, the joinder of all necessary parties where possible, and the joinder of all indispensable parties under any and all conditions, their presence being a sine qua non for the exercise of judicial power. It is precisely "when an indispensable party is not before the court (that) the action should be dismissed." The absence of an indispensable party renders all subsequent actions of the court null and void for want of authority to act, not only as to the absent parties but even as those present. 5. ID.; ID.; ID.; CASE AT BAR. Petitioners' are co-owner of a fishpond. Private respondent does not deny this fact, and the Court of Appeals did not make any contrary finding. The fishpond is undivided; it is impossible to pinpoint which specific portion of

SYNOPSIS Private respondent filed an action for peaceful possession, maintenance of security of tenure and damages against three fishpond co-owners Pacita Arcelona-Olanday, Maria Arcelona-Arellano and Natividad Arcelona-Cruz. Three other co-owners petitioners herein, are naturalized Americans, residing in California, USA. Judgment was rendered by the trial declaring private respondent as tenant-caretaker, which was affirmed by the IAC and the Supreme Court. Subsequently, petitioners filed a petition for annulment of said judgment with the Court of Appeals claiming that the lower court did not acquire jurisdiction over their persons. They claimed that being co-owners, they should all be impleaded as indispensable parties. The Court of Appeals rendered judgment dismissing the petition on the ground of petitioners' failure to allege the sole and only ground of extrinsic fraud in their petition for annulment of judgment. TADCSE The Supreme Court ruled that the Court of Appeals erred in limiting the ground for annulment of judgment to extrinsic fraud, there being two other grounds available, namely, a petition for relief from judgment under Rule 38 of the Rules of Court, and a direct action as certiorari, or a collateral attack, to annul a judgment that is void upon its face or void by virtue of its own recitals. Co-owners in an action for the security of tenure of a tenant are encompassed within the definition of indispensable parties thus, all of them must be impleaded.

SYLLABUS 1. REMEDIAL LAW; ACTIONS; ANNULMENT OF JUDGMENT; GROUNDS. While it is true that in the cited cases of Canlas vs. CA, and Islamic Da' Wah Council of the Philippines vs. Court of Appeals, this Court said that a judgment "may be annulled on the ground of extrinsic or collateral fraud," we should hasten to add that in Macabingkil vs. People's Homesite and Housing Corporation, where the above ruling on annulment of judgment was based, we held that there are really three ways by which a final judgment may be attacked: first, a petition for relief from judgment under Rule 38 of the Rules of Court on

the property is owned by Olanday, et al. and which portion belongs to petitioners. Thus, it is not possible to show over which portion the tenancy relation of private respondent has been established and ruled upon in Civil Case D-7240. Indeed, petitioners should have been properly impleaded as indispensable parties. Servicewide Specialists, Incorporated vs. Court of Appeals held that no final determination of a case could be made if an indispensable party is not impleaded. 6. CIVIL LAW; PROPERTY,; CO-OWNERSHIP; A CO-OWNER CANNOT MAINTAIN AN ACTION IN EJECTMENT WITHOUT JOINING ALL THE OTHER CO-OWNERS. Formerly, Article 487 of the old Civil Code provided that "any one of the co-owners may bring an action in ejectment." It was subsequently held that a co-owner could not maintain an action in ejectment without joining all the other co-owners. 7. REMEDIAL LAW; ACTIONS; INDISPENSABLE PARTIES; ALL CO-OWNERS IN AN ACTION FOR SECURITY OF TENURE OF A TENANT MUST BE IMPLEADED. It is logical that a tenant, in an action to establish his status as such, must implead all the pro-indiviso coowners; in failing to do so, there can be no final determination of the action. In other words, a tenant who fails to implead all the co-owners cannot establish with finality his tenancy over the entire co-owned land. Co-owners in an action for the security of tenure of a tenant are encompassed within the definition of indispensable parties; thus all of them must be impleaded. 8. ID.; ID.; ID.; FAILURE TO IMPLEAD ALL CO-OWNERS BARRED THE LOWER COURT FROM MAKING A FINAL ADJUDICATION. The decision in Civil Case D-7240 cannot adjudicate the entire co-owned property, not even that portion belonging to Olanday et al., ownership of the property being still pro-indiviso. Obviously, the failure to implead petitioners barred the lower court from making a final adjudication. Without the presence of indispensable parties to a suit or proceeding, a judgment therein cannot attain finality Ergo, res inter alios judicatae nullum aliis praejudicarium faciunt. Thus, the Court, through former Chief Justice Marcelo B Fernan, held that a person who was not impleaded in the complaint cannot be bound by the decision rendered therein, for no man shall be affected by a proceeding in which he is a stranger. 9. ID.; ID.; APPEAL; REVIEW OF CIVIL CASES IS CONFINED ONLY TO ISSUES RAISED. BY THE PARTIES. The review of civil cases by appellate courts is confined only to the issues raised by the parties. Hence, appellate courts do not have the privilege or the opportunity afforded the trial courts to consider matters beyond the specifically contested issues, e.g., jurisdiction over indispensable parties, as in this case. Such lack of jurisdiction could not have been known by the appellate courts, including this Court, as it was not patent from the documents or submissions filed before them.

10. ID.; EVIDENCE; FINDINGS OF FACT OF THE TRIAL COURT, GENERALLY UPHELD ON APPEAL; CASE AT BAR, AN EXCEPTION. Whether the indispensable parties were actually impleaded and jurisdiction over them was acquired was a factual question for the trial court to determine. Consistent with the basic doctrine that factual findings of lower courts are binding on appellate courts unless covered by the recognized exceptions, appellate courts must be able to rely on the implied affirmation of the trial court that jurisdiction had been acquired over indispensable parties, especially when this was not raised as an issue on appeal. The responsibility for impleading indispensable parties for the exhaustive trial of a case cannot rest on this forum or on the then Intermediate Appellate Court. Indeed, the Decision of this Court affirming the said trial court's decision is captioned only as "Pacita A. Olanday, Maria A. Arellano and Natividad A. Cruz, petitioners, vs. Intermediate Appellate Court and Moises Farnacio, respondents," clearly indicating that petitioners herein had been omitted as indispensable parties in the proceedings before the trial court and before the appellate tribunals. Substantial justice requires that this error be now rectified. 11. ID.; ANNULMENT OF JUDGMENT; VALIDITY OR NULLITY OF DECISION FOR LACK OF JURISDICTION MUST STAND OR FALL ON ITS OWN FACE AND THE EVIDENCE ON RECORD. As correctly put by petitioners, we hold that Respondent Court of Appeals, in deciding the petition to declare the judgment void, cannot consider extraneous matters to vary what the records bear. In other words, the Court of Appeals cannot annul or declare null the assailed decision with such extraneous matters. The validity or nullity of the said decision must stand or fall on its own face and the evidence on record. In an action to declare a judgment void because of lack of jurisdiction over the parties or subject matter, only evidence found in the records of the case can justify the annulment of the said judgment. Contrariwise, the nullity of the judgment due to lack of jurisdiction may be proved at most by the evidence on record but never by extraneous evidence. The rule is that the nullity of the decision arising from want of jurisdiction and/or due process should appear from the records of the case. And the validity of the judgment cannot be anchored on mere suppositions or speculations, as Respondent Court did.

12. ID.; ID.; EXTRANEOUS EVIDENCE ADMITTED WHERE GROUND IS EXTRINSIC FRAUD. We should add, however, that where an action for annulment of judgment is grounded on extrinsic fraud, extraneous evidence is admitted. We have held that, although a person need not be a party to the judgment sought to be annulled by reason of extrinsic fraud, he must prove his allegation that the judgment was obtained by the use of fraud and collusion and that he would be adversely affected thereby. Fraud must be extraneous; otherwise, there would be no end to litigation. Extrinsic fraud refers to any fraudulent act committed by a prevailing party outside the trial of the case,

whereby the defeated party has been prevented from fully exhibiting his side of the case, because of fraud or deception practiced on him by his opponent. 13. ID.; ID.; ESTOPPEL AND LACHES; SILENCE OF PETITIONERS EXPLAINED BY THE FACT THAT THEY WERE NOT IN THE COUNTRY DURING THE PENDENCY OF THE CIVIL CASE. Equally important, the finding of estoppel and laches by Respondent Court is not supported by the evidence on record. The silence of petitioners can easily be explained by the fact that they were not in the country during the pendency of the subject civil case. Such absence from the country was never rebutted by private respondent. Even in the proceedings antecedent to this case before us now, petitioners were merely represented by their attorney-in-fact. Moreover, they were not at all impleaded as parties in the judgment sought to be voided. Neither were they properly served summons. The indelible fact is that they were completely ignored. 14. ID.; ID.; LACHES; DOES NOT ATTACH WHERE JUDGMENT IS NULL AND VOID. In any event, we ruled in Alabang Development Corporation vs. Valenzuela that no laches attach when the judgment is null and void for want of jurisdiction. 15. ID.; ID.; ESTOPPEL; REQUISITES. In Cruz vs. Court of Appeals, we reiterated the requisites of estoppel: (a) lack of knowledge and of the means of knowledge of the truth as the facts in question; (b) reliance, in good faith, upon the conduct or statements of the party to be estopped; and (c) action or inaction based thereon of such character as to change the position or status of the party claiming the estoppel, to his injury, detriment, or prejudice." 16. ID.; ID.; ID.; PARTY WITHOUT KNOWLEDGE OF PENDING TENANCY CASE CANNOT BE SUBJECT TO ESTOPPEL. The herein facts ineluctably show the absence of the first element in this case. Inasmuch as there is no proof that petitioners had knowledge of the pending tenancy case filed by private respondent, it is only fair that they should not be held in estoppel for failing to intervene in and to question the jurisdiction of the trial court in Civil Case No. D-7240. Thus private respondent may not say that he was misled into believing that petitioners knew of the lease contract and of the litigation of Civil Case No. D-7240. Undisputedly, from the evidence on record, petitioners had no such knowledge. 17. ID.; ID.; APPEALS; ISSUES CAN NOT BE RAISED FOR THE FIRST TIME ON APPEAL. Petitioners' receipt of lease rentals cannot be used as proof of recognition of private respondent as a caretaker-tenant. This issue was not raised in the lower court and is being alleged for the first time before us. Well-settled is the doctrine that questions not raised in the lower courts cannot be raised for the first time on appeal. EAISDH PANGANIBAN, J p:

DECISION

What are the remedies and the grounds therefor to invalidate a final and executory judgment? May extraneous matters, not found in the records of the original case, be used to void such final judgment? Procedurally, may an independent action for annulment of a decision filed in the Court of Appeals prosper in the face of a claim that the remedy of intervention could have been availed of in the regional trial court during the original proceedings? Are all the co-owners pro-indiviso of a real property indispensable parties? Does the non-inclusion of some of such co-owners in a suit involving tenancy over said property constitute sufficient ground to nullify the final decision rendered in such case? The Case These are the main questions raised in this petition for review of the Decision 1 in CA G.R. SP No. 24846 promulgated on July 16, 1991 by the Court of Appeals 2 denying petitioners' plea for annulment of a final and executory judgment rendered by the Regional Trial Court of Dagupan City, Branch 40, in Civil Case No. D-7240, and the Resolution 3 promulgated on November 21, 1991 by the appellate court denying their motion for on reconsideration. The Facts Petitioners Marcelino Arcelona, Tomasa Arcelona-Chiang and Ruth Arcelona are naturalborn Filipinos who are now naturalized Americans residing in California, U.S.A. Petitioner Ruth Arcelona is the surviving spouse and legal heir of the deceased Benedicto Arcelona, brother of Marcelino and Tomasa. Together with their three sisters Pacita Arcelona-Olanday, Maria Arcelona-Arellano and Natividad Arcelona-Cruz (hereinafter collectively referred to as Olanday, et al.) petitioners are co-owners proindiviso of a fishpond which they inherited from their deceased parents. 4 The six Arcelonas (two brothers and four sisters) are named as co-owners in Transfer Certificate of Title No. 34341 which evidences ownership over the fishpond. On March 4, 1978, a contract of lease over the fishpond was executed between Cipriano Tandoc and Olanday, et al. The lease contract was for a period of three (3) years but was renewed up to February 2, 1984 5

Private Respondent Moises Farnacio was appointed in turn by Tandoc as caretakertenant of the same fishpond, effective on the date the contract of lease was executed. After the termination of the lease contract, the lessee (Tandoc) surrendered possession of the leased premises to the lessors, Olanday, et al. Three days thereafter, on February 7, 1984, Private Respondent Farnacio instituted Civil Case D-7240 for "peaceful possession, maintenance of security of tenure plus damages, with motion for the issuance of an interlocutory order" against Olanday, et al., before Respondent Regional Trial Court of Dagupan City, Branch 40. The case was intended to maintain private respondent as tenant of the fishpond. 6 On October 31, 1984, the trial court rendered a decision in favor of private respondent, the dispositive portion of which reads: 7 "WHEREFORE, in the light of the foregoing considerations, this Court hereby renders judgment as follows; to wit: 1. Declaring and recognizing Moises Farnacio as tenant-caretaker over the fishpond in question located at Lomboy District, Dagupan City; 2. Ordering the defendants to maintain plaintiff in the peaceful possession and cultivation of said fishpond, with all the rights accorded and obligations imposed upon him by law; 3. Ordering the Branch Clerk of Court to withdraw and deliver to the plaintiff all the amounts deposited with this Court; and 4. All others claims of the parties are hereby denied for lack of merit." Olanday, et al. elevated the decision to the then Intermediate Appellate Court (IAC) 8 which affirmed with slight modification the decision of the trial court on May 31, 1985. On appeal, this Court 9 sustained the IAC decision in G.R. No. 71217. On May 25, 1991, after remand of the case to the court of origin, private respondent was placed in possession of the entire property covered by TCT 34341. Petitioners then filed with Respondent Court of Appeals a petition for annulment of the aforesaid judgment against private respondent and the implementing sheriff. 10 The case was docketed as CA GR SP No. 24846. On May 8, 1991, Respondent Court issued a resolution directing petitioners "to implead as party defendant the Regional Trial Court

of Dagupan City, Branch 50, Dagupan City." 11 Respondent Court promulgated in due course the assailed Decision and Resolution. Dissatisfied, petitioners lodged this petition for review before us on May 10, 1992. On August 24, 1992, due course was granted to the petition, and the parties filed their respective memoranda. The Issues In their Memorandum dated November 7, 1992, petitioners allege that Respondent Court of Appeals has committed the following errors: 12 "I. The Respondent Court of Appeals erred in ruling that the sole and only ground for annulment of judgment is extrinsic fraud. II. The Respondent Court of Appeals erred when it failed to consider that lack of due process and jurisdiction over the persons of the petitioners are also valid grounds for annulment of judgment. III. In annulment of judgment the grounds should be based solely on the records of the case. It is then an error for the Respondent Court of Appeals to consider matters extraneous to the records of the case. IV. The Respondent Court of Appeals erred in ruling that petitioners should have intervened in the proceedings for issuance of writ of execution before the lower court. V. The Respondent Court of Appeals erred in ruling that the petitioners are estopped or are guilty of laches in questioning the decision of the lower court." The Court believes that these five assigned errors may be condensed into three issues: (1) May a final judgment be annulled on the ground of lack of jurisdiction (over the subject matter and/or over the person of indispensable parties) and denial of due process, aside from extrinsic fraud?

(2) May extraneous matters, not found in the records of the original case, be used in voiding or defending the validity of such final judgment? (3) Procedurally, will an independent action for annulment of the decision of the regional trial court (which was affirmed both by the Court of Appeals and the Supreme Court) filed before the Court of Appeals prosper, or is intervention before the court of origin the only remedy? The Court's Ruling The petition is meritorious. First Issue: Grounds for Annulment of Final Judgment Petitioners contend that Respondent Court of Appeals erred in decreeing "the allsweeping and categorical pronouncement that the sole and only ground for annulment of judgment is extrinsic fraud," and in thereby ignoring various Supreme Court rulings that a final judgment may also be annulled for "a) lack of jurisdiction over the subject matter; b) lack of jurisdiction over the persons of necessary or indispensable parties; and c) lack of due process." 13 Petitioners argue that, being co-owners of the subject property, they are "indispensable parties." 14 Inasmuch as they were not impleaded in Civil Case D-7240, "the questioned judgment of the lower court is void insofar as the petitioners are concerned for want of jurisdiction over their persons and [for] lack of due process." 15 Petitioners "do not see any reason why a person who was not made a party at all could not assail the same proceedings involving his property and affecting his rights and interests." 16 Petitioners further maintain that since "the case involves the personal status of the private respondent, or relates to, or the subject of which is property within the Philippines, then the petitioners as non-residents" are entitled to extra-territorial service, 17 which is a "due process requirement." As they were never served with summons, to "bar them [from] questioning the proceedings of the lower court will be compounding injustice . . . If a party to a case can assail the proceedings for defective service of summons," the same right should be afforded to a person who was not made a party at all. 18 Public respondent disposed of petitioners' above contention in this wise: 19

"First. Annulment of judgment, as the Supreme Court had occasion to rule, rests on a single ground: extrinsic fraud (Canlas vs. Court of Appeals, 170 [sic] SCRA 160, 170). Islamic Da' Wah Council of the Phils. vs. Court of Appeals, 178, 186, citing Anuran vs. Aquino, 38 Phil. 29, emphatically announced that there can be no question as to the right of any person adversely affected by a judgment to maintain an action to enjoin its enforcement and to have it declared a nullity on the ground of fraud and collusion practiced in obtaining the judgment when such fraud is extrinsic or collateral to the matters involved in the issues raised at the trial which resulted in such judgment. cdtai xxx xxx xxx Clearly, there is nothing in the petition that extrinsic fraud, as Macabingkil defines it, indeed vitiated the proceedings during the trial of Civil Case No. D-7240. The essence of the instant petition is worded by the petitioners as follows: 'The common property involved in this case is covered by a Torrens Title, specifically mentioning the co-owners thereof. To bind the entire property and the owners thereof, all the registered owners must be impleaded. The private respondent ONLY IMPLEADED the three co-owners, excluding the petitioners herein. For the petitioners to be bound by the questioned decision, such would really be a derogation of their constitutional right to due process. The questioned decision, too, suffers the fatal defect of utter want of jurisdiction. Accordingly, since the petition for annulment of judgment is not based on the ground of extrinsic fraud, the petition suffers from a basic and fundamental infirmity that deprives petitioners of a valid cause of action against respondents herein " We hold that the Court of Appeals erred in limiting the ground(s) for annulment of judgment to only one, namely, extrinsic fraud. While it is true that in the cited cases of Canlas vs. CA 20 and Islamic Da' Wah Council of the Philippines. vs. Court of Appeals, 21 this Court said that a judgment "may be annulled on the ground of extrinsic or collateral fraud," 22 we should hasten to add that in Macabingkil vs. People's Homesite and

Housing Corporation, 23 where the above ruling on annulment of judgment was based, we held that there are really three ways by which a final judgment may be attacked: 24 "Under existing rules, there are three (3) ways by which a final and executory judgment may be set aside. The first is by petition for relief from judgment under Rule 38 of the Revised Rules of Court, when judgment has been taken against the party through fraud, accident, mistake or excusable negligence, in which case the petition must be filed within sixty (60) days after the petitioner learns of the judgment, but not more than six (6) months after such judgment was entered. The second is by direct action to annul and enjoin the enforcement of the judgment. This remedy presupposes that the challenged judgment is not void upon its face, but is entirely regular in form, and the alleged defect is one which is not apparent upon its face or from the recitals contained in the judgment. [fn: Abbain v. Chua, 22 SCRA 798; Cadano v. Cadano, 49 SCRA 33; Anuran v. Aquino, 38 Phil. 329] As explained in Banco Espaol-Filipino v. Palanca, [fn: 37 Phil. 291, 949] 'under accepted principles of law and practice, long recognized in American courts, the proper remedy in such case, after the time for appeal or review has passed, is for the aggrieved party to bring an action enjoining the judgment, if not already carried into effect; or if the property has already been disposed of, he may institute suit to recover it.' The third is either a direct action, as certiorari, or by a collateral attack against the challenged judgment (which is) is void upon its face, or that the nullity of the judgment is apparent by virtue of its own recitals. As aptly explained by Justice Malcolm in his dissent in Banco Espaol-Filipino v. Palanca, supra, 'A judgment which is void upon its face, and which requires only an inspection of the judgment roll to demonstrate its want of vitality is a dead limb upon the judicial tree, which should be lopped off, if the power so to do exists.' Since the aforementioned decision in Civil Case No. Q-5866 is not void upon its face, it may only be annulled by direct action on the ground of fraud. It is only extrinsic or collateral fraud, as distinguished from intrinsic fraud, however, that can serve as a basis for the annulment of judgment. [Aring v. Original, 6 SCRA 1021, 1025; Velasco v. Velasco, 2 SCRA 736] Fraud has been regarded as extrinsic or collateral, within the meaning of the rule, 'where it is one the effect of which

prevents a party from having a trial, or real contest, or from presenting all of his case to the court, or where it operates upon matters pertaining, not to the judgment itself, but to the manner in which it was procured so that there is not a fair submission of the controversy.'[46 Am. Jur. 913] . . ." It is clear then that to set aside a final and executory judgment, there are three remedies available to a litigant: first, a petition for relief from judgment under Rule 38 of the Rules of Court 25 on grounds of fraud, accident, mistake and excusable negligence filed within sixty (60) days from the time petitioner learns of the judgment but not more than six (6) months from the entry thereof; second, a direct action to annul the judgment on the ground of extrinsic fraud; and third a direct action for certiorari or collateral attack to annul a judgment that is void upon its face or void by virtue of its own recitals. Thus, Macabingkil did not preclude the setting aside of a decision that is patently void where mere inspection of the judgment is enough to demonstrate its nullity on grounds of want of jurisdiction or non-compliance with due process of law. This doctrine is recognized in other cases: 26 ". . . There is no question that a final judgment may be annulled. There are, however, certain requisites which must be established before a judgment can be the subject of an action for annulment 'Under the present procedure, aside from the reliefs provided in these two sections (Secs. 1 & 2, Rule 38), there is no other means whereby the defeated party may procure final and executory judgment to be set aside with a view to the renewal of the litigation, unless (a) the judgment is void for want of jurisdiction or for lack of due process of law, or (b) it has been obtained by fraud.' (I Moran's Rules of Court 1950 Ed., p. 697, citing Anuran v. Aquino, 38 Phil. 29; Banco Espaol-Filipino v. Palanca, 37 Phil. 921). Reason of public policy which favors the stability of judicial decisions are (sic) mute in the presence of fraud which the law abhors (Garchitorena vs. Sotelo, 74 Phil. 25)." On the one hand, extrinsic fraud is the ground to annul a voidable final judgment; the declaration of nullity of a patently void final judgment, on the other, is based on grounds other than extrinsic fraud. To say, then, that petitioners can avail themselves only of the ground of extrinsic fraud and no other is to fail to appreciate the true meaning and ramifications of annulment/nullity. Jurisdiction is conferred by law. Its exercise must strictly comply with the legal requisites; otherwise, a challenge on the ground of lack of jurisdiction may be brought up anytime. Such jurisdiction normally refers to jurisdiction over the subject. As an

example, in a case involving the issuance of a new owner's duplicate certificate of title, the original of which was lost, stolen or destroyed, the court must strictly comply with the requisites of Section 109 of P.D. 1529; otherwise, its jurisdiction may be attacked anytime. Thus, we ruled in New Durawood Co. Inc. vs. Court of Appeals: 27 "In Demetriou vs. Court of Appeals, et al., [238 SCRA 158, at 162 (November 14, 1994)] this Court ruled: 'In Serra Serra v. Court of Appeals (195 SCRA 482 [1991]), on facts analogous to those involved in this case, this Court already held that if a certificate of title has not been lost but is in fact in the possession of another person, the reconstituted title is void and the court rendering the decision has not acquired jurisdiction. Consequently the decision may be attacked any time.' In the instant case, the owner's duplicate certificates of title were in the possession of Dy Quim Pong, the petitioner's chairman of the board and whose family controls the petitioner corporation. Since said certificates were not in fact 'lost or destroyed,' there was no necessity for the petition filed in the trial court for the 'Issuance of New Owner's Duplicate Certificates of Title . . .,' In fact, the said court never acquired jurisdiction to order the issuance of new certificates. Hence, the newly issued duplicates are themselves null and void. It is obvious that this lapse happened because private respondents and respondent judge failed to follow the procedure set forth in P.D. No. 1529 which, as already stated, governs the issuance of new owner's duplicate certificates of title. Section 109 of the said law provides, inter alia, that 'due notice under oath' of the loss or theft of the owner's duplicate certificate 'shall be sent by the owner or by someone in his behalf to the Register of Deeds . . .' (emphasis supplied). In this case, while an affidavit of loss was attached to the petition in the lower court, no such notice was sent to the Register of Deeds. Private respondents tried to convince the Court that by their failure to locate Francis Dytiongsee, they had no other recourse but to file a petition for reconstitution. Sec. 107 of the P.D. 1529, however, states that the remedy, in case of the refusal or failure of the holder

in this case, the petitioner to surrender the owner's duplicate certificate of title, is a 'petition in court to compel surrender of the same to the Register of Deeds,' and not a petition for reconstitution " Ineluctably, a judgment rendered without jurisdiction over the subject matter is void. As we elucidated in Leonor vs. CA: 28 "Clearly and unequivocally, the summary procedure under Rule 108, and for that matter under Art. 412 of the Civil Code, cannot be used by Mauricio to change his and Virginia's civil status from married to single and of their three children from legitimate to illegitimate. Neither does the trial court, under said Rule, have any jurisdiction to declare their marriage null and void and as a result thereof, to order the local civil registrar to cancel the marriage entry in the civil registry. Further, the respondent trial judge gravely and seriously abused his discretion in unceremoniously expanding his very limited jurisdiction under such rule to hear evidence on such a controversial matter as nullity of a marriage under the Civil Code and/or Family Code, a process that is proper only in ordinary adversarial proceedings under the Rules. Jurisdiction over the Persons of Indispensable Parties True, the above dispositions refer to jurisdiction over the subject matter. Basic considerations of due process, however, impel a similar holding in cases involving jurisdiction over the persons of indispensable parties which a court must acquire before it can validly pronounce judgments personal to said defendants. Courts acquire jurisdiction over a party plaintiff upon the filing of the complaint. On the other hand, jurisdiction over the person of a party defendant is assured upon the service of summons in the manner required by law or otherwise by his voluntary appearance. As a rule, if a defendant has not been summoned, the court acquires no jurisdiction over his person, and a personal judgment rendered against such defendant is null and void. 29 A decision that is null and void for want of jurisdiction on the part of the trial court is not a decision in the contemplation of law and, hence, it can never become final and executory. 30 Rule 3, Section 7 of the Rules of Court, defines indispensable parties as parties-ininterest without whom there can be no final determination of an action. As such, they must be joined either as plaintiffs or as defendants. The general rule with reference to the making of parties in a civil action requires, of course, the joinder of all necessary parties where possible, and the joinder of all indispensable parties under any and all

conditions, their presence being a sine qua non for the exercise of judicial power. 31 It is precisely "when an indispensable party is not before the court (that) the action should be dismissed." 32 The absence of an indispensable party renders all subsequent actions of the court null and void for want of authority to act, not only as to the absent parties but even as to those present. 33 cdasia Petitioners are co-owners of a fishpond. Private respondent does not deny this fact, and the Court of Appeals did not make any contrary finding. The fishpond is undivided; it is impossible to pinpoint which specific portion of the property is owned by Olanday, et al. and which portion belongs to petitioners. Thus, it is not possible to show over which portion the tenancy relation of private respondent has been established and ruled upon in Civil Case D-7240. Indeed, petitioners should have been properly impleaded as indispensable parties. Servicewide Specialists, Incorporated vs. Court of Appeals 34 held that no final determination of a case could be made if an indispensable party is not impleaded: ". . . An indispensable party is one whose interest will be affected by the court's action in the litigation, and without whom no final determination of the case can be had. The party's interest in the subject matter of the suit and in the relief sought are so inextricably intertwined with the other parties that his legal presence as a party to the proceeding is an absolute necessity. In his absence there cannot be a resolution of the dispute of the parties before the court which is effective, complete, or equitable " Formerly, Article 487 of the old Civil Code provided that "any one of the co-owners may bring an action in ejectment." It was subsequently-held that a co-owner could not maintain an action in ejectment without joining all the other co-owners. Former Chief Justice Moran, an eminent authority on remedial law, explains: 35 ". . . As held by the Supreme Court, were the courts to permit an action in ejectment to be maintained by a person having merely an undivided interest in any given tract of land, a judgment in favor of the defendants would not be conclusive as against the other coowners not parties to the suit, and thus the defendant in possession of the property might be harassed by as many succeeding actions of ejectment, as there might be co-owners of the title asserted against him. The purpose of this provision was to prevent multiplicity of suits by requiring the person asserting a right against the defendant to include with him, either as co-plaintiffs or as co-defendants, all persons standing in the same position, so that the whole matter in dispute may be determined once and for all in one litigation."

Contrariwise, it is logical that a tenant, in an action to establish his status as such, must implead all the pro-indiviso co-owners; in failing to do so, there can be no final determination of the action. In other words, a tenant who fails to implead all the coowners cannot establish with finality his tenancy over the entire co-owned land. Co-owners in an action for the security of tenure of a tenant are encompassed within the definition of indispensable parties; thus, all of them must be impleaded. As defined: 36 "An indispensable party is a party who has such an interest in the controversy or subject matter that a final adjudication cannot be made, in his absence, without injuring or affecting that interest, a party who has not only an interest in the subject matter of the controversy, but also has an interest of such nature that a final decree cannot be made without affecting his interest or leaving the controversy in such a condition that its final determination may be wholly inconsistent with equity and good conscience. It has also been considered that an indispensable party is a person in whose absence there cannot be a determination between the parties already before the court which is effective, complete, or equitable. Further, an indispensable party is one who must be included in an action before it may properly go forward. A person is not an indispensable party, however, if his interest in the controversy or subject matter is separable from the interest of the other parties, so that it will not necessarily be directly or injuriously affected by a decree which does complete justice between them. Also, a person is not an indispensable party if his presence would merely permit complete relief between him and those already parties to the action, or if he has no interest in the subject matter of the action. It is not a sufficient reason to declare a person to be an indispensable party that his presence will avoid multiple litigation." Clearly, the decision in Civil Case D-7240 cannot bind petitioners and cannot adjudicate the entire co-owned property, not even that portion belonging to Olanday et al., ownership of the property being still pro-indiviso. Obviously, the failure to implead petitioners barred the lower court from making a final adjudication. Without the presence of indispensable parties to a suit or proceeding, a judgment therein cannot attain finality. 37 Ergo, res inter alios judicatae nullum aliis praejudicarium faciunt . 38 Thus, the Court, through former Chief Justice Marcelo B. Fernan, held that a person who was not

impleaded in the complaint cannot be bound by the decision rendered therein, for no man shall be affected by a proceeding in which he is a stranger. 39 Admittedly, in this case, the want of jurisdiction of the trial court in rendering its decision in Civil Case No. D-7240 is not patent on the face of said judgment. However, there were glaring documentary and testimonial pieces of evidence referred to by the trial court in its decision which should have prompted it to inquire further whether there were other indispensable parties who were not impleaded. These facts and circumstances should have forewarned the trial court that it had not acquired jurisdiction over a number of indispensable parties. In American jurisprudence, the nullity of a decision arising from lack of jurisdiction may be determined from the record of the case, not necessarily from the face of the judgment only. 40 We believe that this rule should be applied to this case, considering that in the assailed trial court's decision, referrals were made to crucial evidence which if scrutinized would readily reveal that there were indispensable parties omitted. First, the decision referred to the subject property "as Lot No. 3312 of the Cadastral Survey.'' 41 This lot was particularly described in private respondent's Complaint dated February 6, 1984 filed in Civil Case D-7240. 42 Obviously such description was copied by private respondent from the transfer certificate of title over the subject fishpond issued on August 12, 1975 naming all the co-owners, including the herein petitioners and the fact of their foreign residences, thus: 43 "IT IS HEREBY CERTIFIED that certain land situated in the City of Dagupan, formerly in the Province of Pangasinan bounded and described as follows: A parcel of land (Lot 3312 of the Cadastral Survey of Dagupan), situated in the City of Dagupan. . . is registered in accordance with the provisions of the Land Registration Act in the name of PACITA ARCELONA, married to Miguel Ulanday; TOMASA ARCELONA, married to Tung Ming Chiang; MARCELINO V. ARCELONA, married to Soledad Tiongco; MARIA V. ARCELONA, married to Oreste Arellano; BENEDICTO V. ARCELONA, married to Ruth Suget; and NATIVIDAD ARCELONA, married to Agrimero Cruz; all of legal age, Filipinos, the second and fifth named residents of Los Angeles, California, U.S.A., third & fourth of Manila; first of Villasis, Pangasinan & the last named of Lingayen, Pangasinan as owner thereof in fee simple, subject to such of the incumbrances mentioned in Section 39 of said Act as may be subsisting, and to

xxx xxx xxx Entered at the City of Dagupan Philippines, on the 12th day of August in the year nineteen hundred and seventy-five at 4:00 pm." (Emphasis supplied). Considering that private respondent was suing to establish his status as a tenant over the subject fishpond, the responsibility for impleading all the indispensable parties undeniably rested on him as provided under Rule 3 of the Rules of Court. Section 2 of Rule 3 requires that "every action must be prosecuted and defended in the name of the real party in interest. All persons having an interest in the subject of the action and in obtaining the relief demanded shall be joined as plaintiffs." Further, Section 7 of the same rule states that "(p)arties in interest without whom no final determination can be had of an action shall be joined either as plaintiffs or defendants." Second, Respondent Court of Appeals ruled that private respondent "in his motion to dismiss (before said Court) alleged that petitioners knew of the lessee as revealed by the testimony of Pacita Olanday, one of the defendants in Civil Case No. D-7240 and a sister of petitioners. (TSN, pp. 15-16, hearing of October 2, 1984, Civil Case No. D-7240)." That being so, why did private respondent fail to include petitioners as defendants in the case below? It should be noted that the lease contract was between Cipriano Tandoc and Olanday, et al. Private respondent, a caretaker-tenant of Tandoc, knew or should have known that there were co-owners other than Olanday, et al. And even conceding arguendo that petitioners had authorized Olanday, et al. to enter into a lease contract with Tandoc, this fact did not authorize the latter to represent petitioner in the civil case he brought. Under Rule 9, Section 9 of the Rules of Court, the pleader is required to set forth the names, if known to him, of persons who ought to be parties, if complete relief is to be accorded to those who are already parties but who are not joined; and to state why they have been omitted. Surely, he brought suit to establish his status as a tenant. It is thus his responsibility to state the names of all the persons against whom he wants to establish his status as tenant. aisadc Third, both the private respondent and the trial court knew of the obvious omission of petitioners as party defendants. Telling is the fact that, by reciting part of the transcript of stenographic notes, private respondent himself provided clear evidence in his memorandum that he knew of the existence of other co-owners who were not impleaded in his case against Olanday et al.: 44 "As admitted by Pacita Olanday, one of the defendants in Civil Case No. D-7240, the petitioners know of the lease with Cipriano Tandoc; they were authorized to lease the shares of the petitioners. Here is the testimony of Pacita Olanday:

ATTY. VINLUAN: Q. You made mentioned that you were authorized by your brothers and sister who are (sic) residing in the United States to enter into a contract. Did these brothers and sister of yours make any special power of attorney authorizing you to that effect? xxx xxx xxx A. I talked with my brothers when they 'balik-bayan', they said I will make an agreement. (tsn. October 2, 1984 pp. 15 and 16 CV# D-7240)." He also knew that in executing the lease, Pacita Olanday represented only her sisters (Maria and Natividad) who were residing in the Philippines. Definitely, at the time of the execution of the contract, she had no brother residing in the Philippines because her only brothers, Marcelino and Benedicto Arcelona, (the latter now deceased and represented in this case by Petitioner Ruth Arcelona) were living in California. This fact can be deduced from the recitals of the RTC decision: 45 "It is undisputed in the records that the defendants (referring to Olanday, et al.) are co-owners and civil law lessors of a fishpond otherwise known as Lot No. 3312 of the Cadastral Survey of Dagupan City; that as owners, they entered into a Contract of Lease (Exh. '1') with one Cipriano Tandoc dated March 4, 1978 for a term of three (3) years from February 2, 1982, which contract was renewed for another two (2) years up to February 2, 1984. On the 31st of January, 1984, Exhibit '3', an 'Affidavit of Surrender of Rights and Possession of Lessee over a Fishpond' was executed between Cipriano Tandoc and Pacita Olanday who signed for herself and in behalf of her two (2) sisters. Plaintiff Moises Farnacio was however, instituted as caretaker-tenant over the same fishpond by Cipriano Tandoc on the date of the Contract of Lease was entered into between the owners-lessors and Cipriano Tandoc. The private agreement (Exh. 'D') signed by Cipriano Tandoc and Moises Farnacio is, however, assailed in a criminal case for falsification in the Fiscal's Office." (Underscoring supplied). In fact, only these co-owners who are residing in the Philippines were joined as defendants in Civil Case D-7240. But the mention of Pacita's relatives who were residing

abroad should have made the trial court aware of the existence of indispensable parties who were not yet impleaded. Despite this knowledge of the apparent defect in the complaint and in its jurisdiction, the trial court did not take the initiative to implead petitioners as defendants or to order private respondent to do so, contrary to the clear mandate of Rule 3, Sec. 11 of the Rules of Court 46 which provides: Sec. 11. Misjoinder and non-joinder of parties. Misjoinder of parties is not ground for dismissal of an action. Parties may be dropped or added by order of the court on motion of any party or on its own initiative at any stage of the action and on such terms as are just. Any claim against a party may be severed and proceeded with separately. The foregoing testimony on the existence of other co-owners was a clear signal that indispensable parties had not yet been impleaded. Indeed, this knowledge should have put the private respondent and the trial court on guard. The burden to implead or to order the impleading of indispensable parties is placed on private respondent and on the trial court, respectively. Since no evidence was presented to prove that petitioners were aware of the civil case filed against Olanday et al., they cannot be faulted for not intervening therein. In sum, we hold that the nullity of a judgment grounded on lack of jurisdiction may be shown not only by what patently appears on the face of such decision but also by documentary and testimonial evidence found in the records of the case and upon which such judgment is based. Before ending our discussion on the first issue, we must stress that the then Intermediate Appellate Court and this Court, in affirming the RTC decision in Civil Case No. D-7240 which we here nullify, had not been given the occasion to rule on the issue of the trial court's jurisdiction over the persons of indispensable parties; verily, this question had not been raised before the two appellate courts. The review of civil cases by appellate courts is confined only to the issues raised by the parties. Hence, appellate courts do not have the privilege or the opportunity afforded the trial courts to consider matters beyond the specifically contested issues, e.g., jurisdiction over indispensable parties, as in this case. Such lack of jurisdiction could not have been known by the appellate courts, including this Court, as it was not patent from the documents or submissions filed before them. The issue raised before the then Intermediate Appellate Court and this Court was formulated in this wise: "(t)he validity of private respondent's claim that he is a tenant of the petitioners' fishpond, with security of tenure as such assured under the law, is the basic question presented in this appeal." 47 We

underscore the fact that the issue of whether all the indispensable parties had been validly impleaded, if at all, had not been raised at that time. In any event, whether the indispensable parties were actually impleaded and jurisdiction over them was acquired was a factual question for the trial court to determine. Consistent with the basic doctrine that factual findings of lower courts are binding on appellate courts unless covered by the recognized exceptions, 48 appellate courts must be able to rely on the implied affirmation of the trial court that jurisdiction had been acquired over indispensable parties, especially when this was not raised as an issue on appeal. The responsibility for impleading indispensable parties for the exhaustive trial of a case cannot rest on this forum or on the then Intermediate Appellate Court. Indeed, the Decision of this Court affirming the said trial court's decision is captioned only as "Pacita A. Olanday, Maria A. Arellano and Natividad A. Cruz, petitioners, vs. Intermediate Appellate Court and Moises Farnacio, respondents ", clearly indicating that petitioners herein had been omitted as indispensable parties in the proceedings before the trial court and before the appellate tribunals. Substantial justice requires that this error be now rectified. Second Issue: Estoppel and Laches

It is likewise unbelievable that during all the years that the subject property (fishpond) is under litigation in Civil Case No. D-7240 from 1984 to 1991, petitioners were not aware that their property is subject of the controversy. By their continued silence, they have permitted the acts of their sisters in leasing the property and they cannot now be heard, after a prolonged period of time, to denounce such acts as done without their knowledge and consent. The rule of acquiescence by silence has estopped petitioners to deny the reality of the state of things which they made to appear to exist and upon which others have been led to reply. Parties must take the consequences of the position they assume. Sound ethics require that the apparent in its effects and consequences should be as if it were real, and the law properly so regards. (Metro Manila Transit Corporation vs. Morales, 173 SCRA 629, 633). In Santiago Syjuco, Inc. vs. Castro, 175 SCRA 171, 192, it was held, inter alia: xxx xxx xxx

Apart from holding that there was only one ground to annul a judgment, namely, extrinsic fraud, the appellate court using extraneous evidence also found that estoppel and laches had set in against petitioners, thereby barring them from asserting lack of jurisdiction over their persons These ''extraneous matters" are stated by the Respondent Court in this wise: ". . . True, indeed, that petitioners were not original parties to the action and that the decision embraces half of the property in dispute belonging to petitioners as co-owners thereof. But they cannot now complain they were denied due process. It will be recalled that the contract of lease was entered with one Cipriano Tandoc on March 4, 1978 for a term of three years, which contract was renewed for another two years up to February 2, 1984. During all the years of the existence of the lease contract, it would be incredulous for petitioners to assert that they never knew of such lease agreement from their three sisters, the defendants herein. Petitioners raised no overt protest against the lease contract executed by their sisters with Cipriano Tandoc in 1978 and renewed in 1982. Petitioners took no direct action to promptly disavow or disaffirm the action taken by their sisters to lease the entire property to Tandoc.

. . . Likewise, in Criminal Case No. 16866 for falsification against respondent Farnacio before Branch 3 of the Municipal Trial Court of Dagupan City, witness Juan Bernal testified that the petitioners herein Tomasa Arcelona, Marcelino Arcelona and Ben Arcelona authorized their sisters Natividad Cruz, Corazon Arcelona, Pacita Olanday to lease the fishpond to Cipriano Tandoc. (TSN, pp. 5-6, hearing of August 10, 1987 in Criminal Case No. 16866)." 49 Petitioners balk at these pronouncements, arguing that in annulment of judgments, "the grounds thereof must be based solely on the records of the case." They contend that "to permit the court's record to be contradicted or varied by evidence dehors would render such records of no avail." Petitioners contend that Respondent Court of Appeals erred in taking into account "the proceedings in Criminal Case No. 16866 to show alleged knowledge of the petitioners herein of the lease of the property to Cipriano Tandoc." 50 Petitioners submit that the bone of contention in this case is "not knowledge of the petitioners of the Lease Contract executed by Pacita Olanday et al. and Cipriano Tandoc, but whether the petitioners knew of the case filed by private respondent against Pacita Olanday et al. involving their common property."

Petitioners stress that Private Respondent Farnacio is "a total stranger" and has absolutely no privity of interest with them because it was Tandoc, not Farnacio, who entered into a lease contract with Olanday, et al. 51 Petitioners deny any concealment or deception on their part that would constitute estoppel. They contend that in the transfer certificate of title, their names were specifically mentioned as co-owners of the property on which the private respondent sought to be installed in physical possession as tenant." 52 They aver that Respondent Court of Appeals' finding that they had knowledge of the lease contract "is based on presumption not on clear and convincing evidence." Assuming, according to petitioners, that they can be held in estoppel, it can only be as against Cipriano Tandoc, not private respondent who "was never a party to the lease contract." 53 Since the judgment is void "insofar as the petitioners are concerned for lack of jurisdiction [over] their persons and for want of due process," and since they "were never given the opportunity to institute any action to protect their interest," petitioners contend that to bar them now by laches and estoppel "will create an unfair and unjust situation." For as petitioners candidly state, they "do not question the pronouncement that private respondent is the tenant of Pacita Olanday et al."; however, they submit that the issue in this case is whether private respondent "is also the tenant of herein petitioners entitled to be placed in physical possession and cultivation of their undetermined share in the property without [petitioners] being made parties in the case." 54 Private respondent counters that "Pacita Olanday . . . testified that she was authorized to lease the share of . . . petitioners." According to private respondent, while petitioners were in the Philippines, they were informed of the appointment of private respondent as caretaker-tenant of the entire fishpond, and they did not object to such appointment. 55 Further, private respondent contends that petitioners failed to intervene in the case before the writ of execution was granted on "May 5, 1991" despite the "appearance . . . of their counsel, Atty. Marina Cruz, when the motion for issuance of said writ was heard" Private respondent adds that he was "impliedly recognized" as a tenant when petitioners "received their corresponding shares [i]n the lease rental of the property from the private respondent, through Olanday, et al. and their counsel, Atty. Marina Cruz." 56 As correctly put by petitioners, we hold that Respondent Court of Appeals, in deciding the petition to declare the judgment void, cannot consider extraneous matters to vary what the records bear. In other words, the Court of Appeals cannot annul or declare null the assailed decision with such extraneous matters. The validity or nullity of the said decision must stand or fall on its own face and the evidence on record. cdasia

In an action to declare a judgment void because of lack of jurisdiction over the parties or subject matter, only evidence found in the records of the case can justify the annulment of the said judgment. Contrariwise, the nullity of the judgment due to lack of jurisdiction may be proved at most by the evidence on record but never by extraneous evidence. Sen. Vicente J. Francisco aptly explains this in his treatise on the Rules of Court: 57 "The validity of a final judgment may be attacked on the ground that the judgment or order is null and void, because the court had no power or authority to grant the relief or no jurisdiction over the subject matter or over the parties or both. The aggrieved party may attack the validity of the final judgment by a direct action or proceeding in order to annul the same, as certiorari, which is not incidental to, but is the main object of the proceeding. The validity of a final judgment may also be attacked collaterally as when a party files a motion for the execution of the judgment and the adverse party resists the motion by claiming that the court has no authority to pronounce the judgment and that the same is null and void for lack of jurisdiction over the subject matter or over the parties. In cases of collateral attack, the principles that apply have been stated as follows: 'The legitimate province of collateral impeachment is void judgments. There and there alone can it meet with any measure of success. Decision after decision bears this import: 'In every case the field of collateral inquiry is narrowed down to the single issue concerning the void character of the judgment and the assailant is called upon to satisfy the court that such is the fact. To compass his purpose of overthrowing the judgment, it is not enough that he shows a mistaken or erroneous decision or a record disclosing non-jurisdictional irregularities in the proceedings leading up to the judgment. He must go beyond this and show to the court, generally from the fact of the record itself, and not by extraneous evidence that the judgment complained of is utterly void. If he can do that his attack will succeed for the cases leave no doubt respecting the right of a litigant to collaterally impeach a judgment that he can prove to be void.' The reason for the rule of exclusion of extraneous proof to show that the judgment complained of is utterly void for lack of jurisdiction has been expressed in the following words: 'The doctrine that the question of jurisdiction is to be determined by the record alone, thereby excluding extraneous proof seems to be the natural unavoidable result of that stamp of authenticity which, from

the earliest times, was placed upon the 'record,' and which gave it such 'uncontrollable credit and verity that no plea, proof, or averment could be heard to the contrary.' . . . Any rule, . . . would be disastrous in its results, since to permit the court's record to be contradicted or varied by evidence dehors would render such records of no avail and definite sentences would afford but slight protection to the rights of parties once solemnly adjudicated.'" We should add, however, that where an action for annulment of judgment is grounded on extrinsic fraud, extraneous evidence is admitted. We have held that, although a person need not be a party to the judgment sought to be annulled by reason of extrinsic fraud, he must provehis allegation that the judgment was obtained by the use of fraud and collusion and that he would be adversely affected thereby. 58 Fraud must be extraneous; otherwise, there would be no end to litigation. Extrinsic fraud refers to any fraudulent act committed by a prevailing party outside the trial of the case, whereby the defeated party has been prevented from fully exhibiting his side of the case, because of fraud or deception practiced on him by his opponent. 59 As distinctly defined in Cosmic Lumber Corporation vs. Courts of Appeals, et al.: 60

the case for a new and fair hearing.( fn: Id., p. 344 citing U.S. v. Throckmorton, 25 L. Ed. 93, 95)" In deciding the "petition for annulment of judgment" which should be a "petition to declare judgment void" Respondent Court of Appeals should not have considered the following matters which find no support from the records and are thus considered "extraneous": (1) the assumption that petitioners knew of the five-year lease contract with private respondent and the pendency of Civil Case No. D-7240 from 1984 to 1991; and (2) the testimony of Juan Bernal in a separate criminal case before another court concerning the authority granted to Olanday et al. and where petitioners were not parties. The rule is that the nullity of the decision arising from want of jurisdiction and/or due process should appear from the records of the case. And the validity of the judgment cannot be anchored on mere suppositions or speculations, as Respondent Court did. Equally important, the finding of estoppel and laches by Respondent Court is not supported by the evidence on record. The silence of petitioners can easily be explained by the fact that they were not in the country during the pendency of the subject civil case. Such absence from the country was never rebutted by private respondent. Even in the proceedings antecedent to this case before us now, petitioners were merely represented by their attorney-in-fact. 61 Moreover, they were not at all impleaded as parties in the judgment sought to be voided. Neither were they properly served summons. The indelible fact is that they were completely ignored. In any event, we ruled in Alabang Development Corporation vs. Valenzuela 62 that no laches attach when the judgment is null and void for want of jurisdiction: "The herein respondents attribute laches to the petitioners for not appealing from the order of the lower court denying their motion to intervene and motion for new trial hence allowing the said order/decision to become final. There is no laches nor finality of any decision to speak of since the decision under question is herein pronounced null and void for having been rendered without jurisdiction. Prescinding therefrom, as admitted by themselves in their comment, the judgment of reconstitution is 'ineffective' against the owners of lands covered thereby who were not joined as parties in the proceeding. As the Court ruled in Bernal case on the matter of intervention [fn: 93 SCRA at pp. 247, 248] 'a valid judgment cannot even be rendered where there is want of indispensable parties' such as petitioners who hold subsisting Torrens Title to the properties in question and 'this aspect of the case commands the joinder of indispensable parties to allow them

"There is extrinsic fraud within the meaning of Sec. 9, par. (2), of B.P. Blg. 129, where it is one the effect of which prevents a party from hearing a trial, or real contest, or from presenting all of his case to the court, or where it operates upon matters, not pertaining to the judgment itself, but to the manner in which it was procured so that there is not a fair submission of the controversy. In other words, extrinsic fraud refers to any fraudulent act of the prevailing party in the litigation which is committed outside of the trial of the case, whereby the defeated party has been prevented from exhibiting fully his side of the case by fraud or deception practiced on him by his opponent. (fn: Makabingkil v. PHHC, No. L-29080, 17 August 1976, 72 SCRA 326, 343-344) Fraud is extrinsic where the unsuccessful party has been prevented from exhibiting fully his case, by fraud or deception practiced on him by his opponent, as keeping him away from court, a false promise of a compromise; or where the defendant never had knowledge of the suit, being kept in ignorance by the acts of the plaintiff; or where an attorney fraudulently or without authority connives at his defeat; these and similar cases which show that there has never been a real contest in the trial or hearing of the case are reasons for which a new suit may be sustained to set aside and annul the former judgment and open

to uphold their interests based upon the Torrens titles they hold overrides any question of later intervention.' Petitioners have precisely availed of the proper, speedy and adequate remedy of the present special civil action of certiorari and prohibition to annul and set aside for want of jurisdiction the decision and all proceedings of respondent judge." On the other hand, the doctrine of estoppel is predicated on and finds its roots in equity which, broadly defined, is justice according to natural law and right. It is a principle intended to prevent a clear case of injustice. The term is hardly separable from a waiver of right. Estoppel, like laches, must be intentional and unequivocal, for when misapplied, it can easily become a most convenient and effective means of injustice. Estoppel is a principle that, as a rule) can be invoked only in highly exceptional and legitimate cases. 63 In Cruz vs. Court of Appeals, 64 we reiterated the requisites of estoppel: "In Kalalo vs. Luz, [ fn: 34 SCRA 337] We held that the essential elements of estoppel in respect to the party claiming it are: (a) lack of knowledge and of the means of knowledge of the truth as the facts in question; (b) reliance, in good faith, upon the conduct or statements of the party to be estopped; and (c) action or inaction based thereon of such character as to change the position or status of the party claiming the estoppel, to his injury, detriment, or prejudice." The herein facts ineluctably show the absence of the first element in this case. Inasmuch as there is no proof that petitioners had knowledge of the pending tenancy case filed by private respondent, it is only fair that they should not be held in estoppel for failing to intervene in and to question the jurisdiction of the trial court in Civil Case No. D-7240. Thus, private respondent may not say that he was misled into believing that petitioners knew of the lease contract and of the litigation of Civil Case No. D-7240. Undisputedly, from the evidence on record, petitioners had no such knowledge. Petitioners' receipt of lease rentals cannot be used as proof of recognition of private respondent as a caretaker-tenant. This issue was not raised in the lower court and is being alleged for the first time before us. Well-settled is the doctrine that questions not raised in the lower courts cannot be raised for the first time on appeal. 65 Third Issue: Intervention as a Remedy of Petitioners Petitioners' contend that Respondent Court of Appeals erred when it ruled that their only remedy was intervention during the execution stage of Civil Case No. D-7240.

Inasmuch as "annulment of judgment could be made either collaterally or directly," petitioners insist that their resort to "direct action in annulling the Decision of the lower court should not be taken against them." 66 Moreover, petitioners argue that "in proceedings for execution of a final decision or judgment, it is the ministerial duty of the court of origin to issue the writ." 67 Petitioners add that because their action would result in the "modification, alteration, and annulment of the judgment, the specific provision of law that annulment of judgment of the Regional Trial Court is within the exclusive jurisdiction of the Court of Appeals should prevail." 68 Private respondent counters that petitioners deliberately did not intervene "to afford them opportunity to question, as they now question, the validity of any decision to be rendered in said case, . . . in the event of an adverse decision." 69 We hold that intervention is not the only remedy to assail a void final judgment. There is no procedural rule prescribing that petitioners' intervention in the hearing for the issuance of a writ is the only way to question a void final judgment. As already stated, petitioners were not aware of such hearing. Besides, as already discussed, a direct action is available in assailing final judgments grounded on extrinsic fraud, while a direct or a collateral action may be used to show lack of jurisdiction. The assailed Decision of Respondent Court of Appeals cites certain cases allowing intervention as follows: 70 "A case in which an execution has been issued is regarded as still pending so that all proceedings in the execution are proceedings in the suit. There is no question that the court which rendered the judgment has a general supervisory control over its process of execution and this power carries with it the right to determine every question of fact and law which may be involved in the execution. (Suson vs. Court of Appeals, 172 SCRA 70, 75, citing Paman vs. Severis, 115 SCRA 709; Seavan Carrier vs. GTI Sportswear, 137 SCRA 580)" These cases, which require intervention of parties who may be adversely affected by the decision, are not applicable. In the cited Suson vs. Court of Appeals, 71 the parties, though not impleaded, knew of the case and were in fact directed by the trial court to intervene, but they refused to do so. These particular facts are absent in the instant case where, to repeat, petitioners were abroad when Civil Case D-7240 was prosecuted. In any event, as earlier pointed out, jurisprudence upholds the soundness of an independent action to declare as null and void a judgment rendered without jurisdiction as in this case. In Leonor vs. Court of Appeals, 72 Petitioner Virginia A.

Leonor, through a "petition for certiorari, prohibition and mandamus . . . sought the nullification of both the decision dated December 14, 1992 and the order dated February 24, 1993 of the trial court for having been issued in excess of jurisdiction and/or with grave abuse of discretion." 73 We held in that case that: 74 "A void judgment for want of jurisdiction is no judgment at all. It cannot be the source of any right nor the creator of any obligation. All acts performed pursuant to it and all claims emanating from it have no legal effect. Hence, it can never become final and any writ of execution based on it is void: .'. . . it may be said to be a lawless thing which can be treated as an outlaw and slain at sight, or ignored wherever and whenever it exhibits its head.'" cdasia

this Court a Petition for Review on Certiorari under Rule 45 of the Rules of Court on this sole ground: HAICcD The Executive Judge of the Regional Trial Court of Pasay City gravely erred in dismissing the petition in view of the fact that: (A) Section 20 of Rep. Act No. 4726, as amended, otherwise known as the "Condominium Act", expressly grant the petitioner, being the acknowledged association of unit owners at Marbella I Condominium, the right to enforce its liens of unpaid dues and other assessments in the same manner provided for by law for judicial or extra-judicial foreclosure of mortgage of real property; and (B) Such practice of auctioning the delinquent condominium unit through a petition for extra-judicial foreclosure of mortgage, as aforestated is permitted in other jurisdictions, such as in the City of Manila. 3 The factual antecedents are as follows.

WHEREFORE, the petition for certiorari is GRANTED. The Decision of Respondent Court of Appeals is hereby REVERSED and SET ASIDE. The decisions in Civil Case No. D-7240, AC-G.R. SP-05237-CAR and G.R. No. L-71217 are ANNULLED and SET ASIDE for lack of jurisdiction. No costs. SO ORDERED.

THIRD DIVISION [G.R. No. 163196. July 4, 2008.] FIRST MARBELLA CONDOMINIUM ASSOCIATION, INC., petitioner, vs. AUGUSTO GATMAYTAN, respondent.

Respondent is the registered owner of Fontavilla No. 501 (condominium unit), Marbella I Condominium, Roxas Boulevard, Pasay City, under Condominium Certificate of Title No. 1972 (CCT No. 1972). 4 Inscribed on his title is a Declaration of Restrictions, to wit: CcHDSA Entry No. 65370/T-20065 DECLARATIONS OF RESTRICTIONS executed by the herein registered owner, is hereon annotated restrictions shall be deemed to run with the land, the bldg. & other improvements making up the project, shall constitute lien upon the project, and each unit and shall inure to the benefit of, and be binding upon all units owners, purchasers, interchangeably or sometimes referred to in this Master of Deed with Dec. of Restrictions as occupant, [sic] or holding any w/o [sic] or any right or interest therein or in the project, pursuant to the prov. of the condominium act or other pertinent laws. See restrictions and conditions imposed on Doc. No. 114, Page 24, Bk. I, s. of 1974 of the Not. Pub. for Rizal, M. Perez, Cardenas among w/c are those dealing on scope & coverage; Management Body; repair, alteration et [sic] assessment real property of restrictions & bldg. rules & waivers rights and assignee, tenants occupants of unit validity, [sic] amendment of declaration dated March 19, 1974. Date

DECISION

AUSTRIA-MARTINEZ, J p: From the January 7, 2004 Order 1 of the Regional Trial Court (RTC), Pasay City, denying the request of First Marbella Condominium Association, Inc. (petitioner) for extrajudicial foreclosure against Augusto Gatmaytan (respondent); and the March 31, 2004 RTC Order, 2 denying petitioner's Motion for Reconsideration, the latter filed directly with

of inscription May 9, 1979 3:02 p.m. 5 (Emphasis supplied). IcDCaS Also inscribed is a Notice of Assessment, which states: Entry No. 96-2466/CCT No. 1972 NOTICE OF ASSESSMENT Executed by MILAGROS D. CUBACUB in her capacity as VicePresident/Administrator of FIRST MARBELLA CONDOMINIUM ASSOCIATION, INC. (FMCAI) [herein petitioner], stating among other things that the condominium unit, described herein has an outstanding dues with the FMCAI in the sum of P775,786.17, inclusive of interests, penalties and attorney's fees, which aforementioned liabilities constitute as first lien against this condominium unit pursuant to the Master Deed of Restrictions. (Doc. No. 34; Page No. 7; Book No. III; Series of 1996 before Notary Public Jose A. Suing, Notary Public for Quezon City). Date of Instrument March 27, 1996. Date of Inscription May 3, 1996 2:10 p.m. 6 On November 11, 2003, petitioner filed with the RTC, through the Office of the Clerk of Court & Ex-Oficio Sheriff, a Petition 7 for extrajudicial foreclosure of the condominium unit of respondent, alleging that it (petitioner) is a duly organized association of the tenants and homeowners of Marbella I Condominium; that respondent is a member thereof but has unpaid association dues amounting to P3,229,104.89, as of June 30, 2003; and that the latter refused to pay his dues despite demand. The petition is docketed as File Case No. 03-033. Attached to it are the June 30, 2003 Statement of Account 8 and July 22, 2000 demand letter 9 issued to respondent. TAacIE In a letter dated November 21, 2003, the Clerk of Court, as Ex-Oficio Sheriff, recommended to the RTC Executive Judge that the petition be dismissed for the following reasons: Under the facts given, no mortgage exists between the petitioner and respondent. Evidently, it is not one of those contemplated under Act 3135 as amended by Act 4118. The allegation simply does not show a mortgagor-mortgagee relationship since respondent liability arises from his failure to pay dues, assessments and charges due to the petitioner.

As clearly stated, the authority of the Executive Judge under Administrative Matter No. 99-10-05-0, as amended dated March 1, 2001, covers extra-judicial foreclosure of real estate mortgages under R.A. No. 3135 and chattel mortgages under P.D. No. 1508. There is nothing in the above mentioned Circular which authorizes the Executive Judge and/or the Ex-Officio Sheriff to extra judicially foreclose properties covered by obligations other than the said mortgages. Hence, the subject petition is not proper for extrajudicial foreclosure under the supervision of the Executive Judge. Dismissal of the subject petition is recommended. 10 Agreeing with the Clerk of Court, the RTC Executive Judge issued on January 7, 2004 the following Order: Upon perusal of the pertinent laws and Supreme Court Resolutions, this Court concurs with the position taken by the Ex-Oficio Sheriff that herein petition is not within the coverage of Administrative Matter No. 99-10-05-0 as amended, dated March 1, 2001 re: Procedure in Extra Judicial Foreclosure of Mortgage, paragraph 1 thereof is hereby quoted as follows: "1. All applications for extra-judicial foreclosure of mortgage whether under the direction of the sheriff or a notary public, pursuant to Act 3135, as amended by Act 4118, and Act 1508, as amended, shall be filed with the Executive Judge, through the Clerk of Court who is also the Ex-Oficio Sheriff." Hence, it is not within the authority of the Executive Judge to supervise and approve extra judicial foreclosures of mortgages. WHEREFORE, the request for extra-judicial foreclosure of the subject condominium unit is DENIED. Consequently, the petition is DISMISSED. cTEICD SO ORDERED. 11 (Emphasis added). Petitioner filed a Motion for Reconsideration, 12 but the RTC Executive Judge denied it in an Order 13 dated March 31, 2004. Hence, the present petition.

Petitioner asserts that it is expressly provided under Section 20 of Republic Act (R.A.) No. 4726 that it has the right to cause the extrajudicial foreclosure of its annotated lien on the condominium unit. Its petition then is cognizable by the RTC under Administrative Matter No. 99-10-05. 14 In his Comment, 15 Supplemental Comment 16 and Memorandum, 17 respondent objects to petitioner's direct appeal to this Court from an Order issued by the RTC on a mere administrative matter. 18 Respondent also impugns petitioner's right to file the petition for extra-judicial foreclosure, pointing out that the latter does not hold a real estate mortgage on the condominium unit or a special power of attorney to cause the extra-judicial foreclosure sale of said unit. 19 Respondent claims that there is even a pending litigation regarding the validity of petitioner's constitution as a homeowners association and its authority to assess association dues, annotate unpaid assessments on condominium titles and enforce the same through extrajudicial foreclosure sale. 20 In sum, respondent contends that petitioner has no factual or legal basis to file the petition for extrajudicial foreclosure. HDTISa The petition lacks merit.

Although under Section 5, 23 Rule 56, an erroneous appeal may be dismissed outright, this Court shall not exercise such option; but instead, shall treat the present petition as a petition for mandamus to obviate further litigation between the parties. 24 Yet, in order to avail itself of a writ of mandamus, petitioner must establish that it has a clear right to the extrajudicial foreclosure sale of the condominium unit of respondent. 25 Under Circular No. 7-2002, 26 implementing Supreme Court Administrative Matter No. 99-10-05-0, 27 it is mandatory that a petition for extrajudicial foreclosure be supported by evidence that petitioner holds a special power or authority to foreclose, thus: Sec. 1. All applications for extra-judicial foreclosure of mortgage, whether under the direction of the Sheriff or a notary public pursuant to Art. No. 3135, as amended, and Act 1508, as amended, shall be filed with the Executive Judge, through the Clerk of Court, who is also the Ex-Officio Sheriff (A.M. No. 99-10-05-0, as amended, March 1, 2001). DAHSaT Sec. 2. Upon receipt of the application, the Clerk of Court shall:

Only a judgment, final order or resolution rendered by a court in the exercise of its judicial functions relative to an actual controversy is subject to an appeal to this Court by way of a Petition for Review on Certiorari under Rule 45 of the Rules of Court. 21 The January 7, 2004 Order and March 21, 2004 Order assailed herein were issued by the RTC Executive Judge in the exercise of his administrative function to supervise the ministerial duty of the Clerk of Court as Ex-Oficio Sheriff in the conduct of an extrajudicial foreclosure sale; hence, said orders are not appealable under Rule 45. Rather, the correct mode of appeal is by petition for mandamus 22 under Section 3, Rule 65 of the Rules of Court, to wit: Sec. 3. Petition for mandamus When any tribunal, corporation, board, officer or person unlawfully neglects the performance of an act which the law specifically enjoins as a duty resulting from an office, trust, or station, or unlawfully excludes another from the use and enjoyment of a right or office to which such other is entitled, and there is no other plain, speedy and adequate remedy in the ordinary course of law, the person aggrieved thereby may file a verified petition in the proper court, alleging the facts with certainty and praying that judgment be rendered commanding the respondent, immediately or at some other time to be specified by the court, to do the act required to be done to protect the rights of the petitioner, and to pay the damages sustained by the petitioner by reason of the wrongful acts of the respondent. aIcCTA

a. Examine the same to ensure that the special power of attorney authorizing the extra-judicial foreclosure of the real property is either inserted into or attached to the deed of real estate mortgage (Act No. 3135, Sec. 1, as amended) . . . . Without proof of petitioner's special authority to foreclose, the Clerk of Court as ExOficio Sheriff is precluded from acting on the application for extrajudicial foreclosure. 28 In the present case, the only basis of petitioner for causing the extrajudicial foreclosure of the condominium unit of respondent is a notice of assessment annotated on CCT No. 1972 in accordance with Section 20 of R.A. No. 4726. However, neither annotation nor law vests it with sufficient authority to foreclose on the property. DaACIH The notice of assessment contains no provision for the extrajudicial foreclosure of the condominium unit. All that it states is that the assessment of petitioner against respondent for unpaid association dues constitutes a "first lien against [the] condominium unit". 29 Neither does Section 20 of R.A. No. 4726 30 grant petitioner special authority to foreclose. All that the law provides is the following:

Sec. 20. The assessment upon any condominium made in accordance with a duly registered declaration of restrictions shall be an obligation of the owner thereof at the time the assessment is made. The amount of any such assessment plus any other charges thereon, such as interest, costs (including attorney's fees) and penalties, as such may be provided for in the declaration of restrictions, shall be and become a lien upon the condominium to be registered with the Register of Deeds of the city or province where such condominium project is located. The notice shall state the amount of such assessment and such other charges thereon as may be authorized by the declaration of restrictions, a description of condominium unit against which same has been assessed, and the name of the registered owner thereof. Such notice shall be signed by an authorized representative of the management body or as otherwise provided in the declaration of restrictions. Upon payment of said assessment and charges or other satisfaction thereof, the management body shall cause to be registered a release of the lien. HcSCED Such lien shall be superior to all other liens registered subsequent to the registration of said notice of assessment except real property tax liens and except that the declaration of restrictions may provide for the subordination thereof to any other liens and encumbrances, such liens may be enforced in the same manner provided for by law for the judicial or extra-judicial foreclosure of mortgage or real property. Unless otherwise provided for in the declaration of the restrictions, the management body shall have power to bid at foreclosure sale. The condominium owner shall have the right of redemption as in cases of judicial or extra-judicial foreclosure of mortgages. (Emphasis supplied). Clearly, Section 20 merely prescribes the procedure by which petitioner's claim may be treated as a superior lien i.e., through the annotation thereof on the title of the condominium unit. 31 While the law also grants petitioner the option to enforce said lien through either the judicial or extrajudicial foreclosure sale of the condominium unit, Section 20 does not by itself, ipso facto, authorize judicial as extra-judicial foreclosure of the condominium unit. Petitioner may avail itself of either option only in the manner provided for by the governing law and rules. As already pointed out, A.M. No. No. 99-1005-0, as implemented under Circular No. 7-2002, requires that petitioner furnish evidence of its special authority to cause the extrajudicial foreclosure of the condominium unit. SaDICE

There being no evidence of such special authority, petitioner failed to establish a clear right to a writ of mandamus to compel the RTC to act on its petition for extrajudicial foreclosure. WHEREFORE, the petition is DENIED for lack of merit. Costs against petitioner. EaHATD SO ORDERED.

SECOND DIVISION [G.R. No. 164110. February 12, 2008.] LEONOR B. CRUZ, petitioner, vs. TEOFILA M. CATAPANG, respondent.

DECISION

QUISUMBING, J p: This petition for review seeks the reversal of the Decision 1 dated September 16, 2003 and the Resolution 2 dated June 11, 2004 of the Court of Appeals in CA-G.R. SP No. 69250. The Court of Appeals reversed the Decision 3 dated October 22, 2001 of the Regional Trial Court (RTC), Branch 86, Taal, Batangas, which had earlier affirmed the Decision 4 dated September 20, 1999 of the 7th Municipal Circuit Trial Court (MCTC) of Taal, Batangas ordering respondent to vacate and deliver possession of a portion of the lot co-owned by petitioner, Luz Cruz and Norma Maligaya. The antecedent facts of the case are as follows. Petitioner Leonor B. Cruz, Luz Cruz and Norma Maligaya are the co-owners of a parcel of land covering an area of 1,435 square meters located at Barangay Mahabang Ludlod, Taal, Batangas. 5 With the consent of Norma Maligaya, one of the aforementioned coowners, respondent Teofila M. Catapang built a house on a lot adjacent to the abovementioned parcel of land sometime in 1992. The house intruded, however, on a portion of the co-owned property. 6

In the first week of September 1995, petitioner Leonor B. Cruz visited the property and was surprised to see a part of respondent's house intruding unto a portion of the coowned property. She then made several demands upon respondent to demolish the intruding structure and to vacate the portion encroaching on their property. The respondent, however, refused and disregarded her demands. 7 On January 25, 1996, the petitioner filed a complaint 8 for forcible entry against respondent before the 7th MCTC of Taal, Batangas. The MCTC decided in favor of petitioner, ruling that consent of only one of the co-owners is not sufficient to justify defendant's construction of the house and possession of the portion of the lot in question. 9 The dispositive portion of the MCTC decision reads: WHEREFORE, judgment is hereby rendered ordering the defendant or any person acting in her behalf to vacate and deliver the possession of the area illegally occupied to the plaintiff; ordering the defendant to pay plaintiff reasonable attorney's fees of P10,000.00, plus costs of suit. SO ORDERED. 10 On appeal, the RTC, Branch 86, Taal, Batangas, affirmed the MCTC's ruling in a Decision dated October 22, 2001, the dispositive portion of which states: Wherefore, premises considered, the decision [appealed] from is hereby affirmed in toto. SO ORDERED. 11 After her motion for reconsideration was denied by the RTC, respondent filed a petition for review with the Court of Appeals, which reversed the RTC's decision. The Court of Appeals held that there is no cause of action for forcible entry in this case because respondent's entry into the property, considering the consent given by co-owner Norma Maligaya, cannot be characterized as one made through strategy or stealth which gives rise to a cause of action for forcible entry. 12 The Court of Appeals' decision further held that petitioner's remedy is not an action for ejectment but an entirely different recourse with the appropriate forum. The Court of Appeals disposed, thus: WHEREFORE, premises considered, the instant Petition is hereby GRANTED. The challenged Decision dated 22 October 2001 as well as the Order dated 07 January 2002 of the Regional Trial Court of Taal, Batangas, Branch 86, are hereby REVERSED and SET ASIDE

and, in lieu thereof, another is entered DISMISSING the complaint for forcible entry docketed as Civil Case No. 71-T. SO ORDERED. 13 After petitioner's motion for reconsideration was denied by the Court of Appeals in a Resolution dated June 11, 2004, she filed the instant petition. Raised before us for consideration are the following issues: I. WHETHER OR NOT THE KNOWLEDGE AND CONSENT OF CO-OWNER NORMA MALIGAYA IS A VALID LICENSE FOR THE RESPONDENT TO ERECT THE BUNGALOW HOUSE ON THE PREMISES OWNED PROINDIVISO SANS CONSENT FROM THE PETITIONER AND OTHE[R] COOWNER[.] II. WHETHER OR NOT RESPONDENT, BY HER ACTS, HAS ACQUIRED EXCLUSIVE OWNERSHIP OVER THE PORTION OF THE LOT SUBJECT OF THE PREMISES PURSUANT TO THE CONSENT GRANTED UNTO HER BY CO-OWNER NORMA MALIGAYA TO THE EXCLUSION OF THE PETITIONER AND THE OTHER CO-OWNER. 14 III. . . . WHETHER OR NOT RESPONDENT IN FACT OBTAINED POSSESSION OF THE PROPERTY IN QUESTION BY MEANS OF SIMPLE STRATEGY. 15 Petitioner prays in her petition that we effectively reverse the Court of Appeals' decision. Simply put, the main issue before us is whether consent given by a co-owner of a parcel of land to a person to construct a house on the co-owned property warrants the dismissal of a forcible entry case filed by another co-owner against that person. In her memorandum, 16 petitioner contends that the consent and knowledge of coowner Norma Maligaya cannot defeat the action for forcible entry since it is a basic

principle in the law of co-ownership that no individual co-owner can claim title to any definite portion of the land or thing owned in common until partition. On the other hand, respondent in her memorandum 17 counters that the complaint for forcible entry cannot prosper because her entry into the property was not through strategy or stealth due to the consent of one of the co-owners. She further argues that since Norma Maligaya is residing in the house she built, the issue is not just possession de facto but also one of possession de jure since it involves rights of co-owners to enjoy the property. As to the issue of whether or not the consent of one co-owner will warrant the dismissal of a forcible entry case filed by another co-owner against the person who was given the consent to construct a house on the co-owned property, we have held that a co-owner cannot devote common property to his or her exclusive use to the prejudice of the coownership. 18 In our view, a co-owner cannot give valid consent to another to build a house on the co-owned property, which is an act tantamount to devoting the property to his or her exclusive use. Furthermore, Articles 486 and 491 of the Civil Code provide: Art. 486. Each co-owner may use the thing owned in common, provided he does so in accordance with the purpose for which it is intended and in such a way as not to injure the interest of the coownership or prevent the other co-owners from using it according to their rights. The purpose of the co-ownership may be changed by agreement, express or implied. Art. 491. None of the co-owners shall, without the consent of the others, make alterations in the thing owned in common, even though benefits for all would result therefrom. However, if the withholding of the consent by one or more of the co-owners is clearly prejudicial to the common interest, the courts may afford adequate relief. Article 486 states each co-owner may use the thing owned in common provided he does so in accordance with the purpose for which it is intended and in such a way as not to injure the interest of the co-ownership or prevent the other co-owners from using it according to their rights. Giving consent to a third person to construct a house on the co-owned property will injure the interest of the co-ownership and prevent other coowners from using the property in accordance with their rights.

Under Article 491, none of the co-owners shall, without the consent of the others, make alterations in the thing owned in common. It necessarily follows that none of the coowners can, without the consent of the other co-owners, validly consent to the making of an alteration by another person, such as respondent, in the thing owned in common. Alterations include any act of strict dominion or ownership and any encumbrance or disposition has been held implicitly to be an act of alteration. 19 The construction of a house on the co-owned property is an act of dominion. Therefore, it is an alteration falling under Article 491 of the Civil Code. There being no consent from all co-owners, respondent had no right to construct her house on the co-owned property. Consent of only one co-owner will not warrant the dismissal of the complaint for forcible entry filed against the builder. The consent given by Norma Maligaya in the absence of the consent of petitioner and Luz Cruz did not vest upon respondent any right to enter into the co-owned property. Her entry into the property still falls under the classification "through strategy or stealth". The Court of Appeals held that there is no forcible entry because respondent's entry into the property was not through strategy or stealth due to the consent given to her by one of the co-owners. We cannot give our imprimatur to this sweeping conclusion. Respondent's entry into the property without the permission of petitioner could appear to be a secret and clandestine act done in connivance with co-owner Norma Maligaya whom respondent allowed to stay in her house. Entry into the land effected clandestinely without the knowledge of the other co-owners could be categorized as possession by stealth. 20 Moreover, respondent's act of getting only the consent of one co-owner, her sister Norma Maligaya, and allowing the latter to stay in the constructed house, can in fact be considered as a strategy which she utilized in order to enter into the co-owned property. As such, respondent's acts constitute forcible entry. Petitioner's filing of a complaint for forcible entry, in our view, was within the one-year period for filing the complaint. The one-year period within which to bring an action for forcible entry is generally counted from the date of actual entry to the land. However, when entry is made through stealth, then the one-year period is counted from the time the petitioner learned about it. 21 Although respondent constructed her house in 1992, it was only in September 1995 that petitioner learned of it when she visited the property. Accordingly, she then made demands on respondent to vacate the premises. Failing to get a favorable response, petitioner filed the complaint on January 25, 1996, which is within the one-year period from the time petitioner learned of the construction.

WHEREFORE, the petition is GRANTED. The Decision dated September 16, 2003 and the Resolution dated June 11, 2004 of the Court of Appeals in CA-G.R. SP No. 69250 are REVERSED and SET ASIDE. The Decision dated October 22, 2001 of the Regional Trial Court, Branch 86, Taal, Batangas is REINSTATED. Costs against respondent. SO ORDERED.

FIRST DIVISION [G.R. No. 125233. March 9, 2000.] Spouses ALEXANDER CRUZ and ADELAIDA CRUZ, petitioners, vs. ELEUTERIO LEIS, RAYMUNDO LEIS, ANASTACIO L. LAGDANO, LORETA L. CAYONDA and the HONORABLE COURT OF APPEALS, respondents.

Private respondents claimed, among others, that the said property was conjugal and, consequently, its sale without the knowledge and consent of private respondents was in derogation of their rights as heirs. Thereafter, the trial court rendered a decision in favor of private respondents. On appeal, the Court of Appeals affirmed the decision of the trial court holding that since the property was acquired during the marriage of Gertrudes to Adriano, the same was presumed to be conjugal property. It, however, found that Gertrudes as well as private respondents failed to repurchase the property within the period stipulated and had lost all their rights. Nevertheless, it still ruled against petitioners holding that there was no compliance with Article 1607 of the Civil Code requiring a judicial hearing before registration of the property in the name of petitioners. Hence, this petition. It bears stressing that notwithstanding Article 1607, the recording in the Registry of Property of the consolidation of ownership of the vendee is not a condition sine qua non to the transfer of ownership. Petitioners are the owners of the subject property since neither Gertrudes nor her co-owners redeemed the same within the one-year period stipulated in the "Kasunduan." The essence of a pacto de retro sale is that title and ownership of the property sold are immediately vested in the vendee a retro, subject to the resolutory condition of repurchase by the vendor a retro within the stipulated period. Failure thus of the vendor a retro to perform said resolutory condition vests upon the vendee by operation of law absolute title and ownership over the property sold. As title is already vested in the vendee a retro, his failure to consolidate his title under Article 1607 of the Civil Code does not impair such title or ownership for the method prescribed thereunder is merely for the purpose of registering the consolidated title. The Supreme Court, therefore, modified the decision of the Court of Appeals. It ordered the cancellation of TCT No. 130584, which was issued without judicial order, and the reinstatement of Transfer Certificate of Title No. 43100 in the name of Gertrudes Isidro, without prejudice to compliance by petitioners with the provisions of Article 1607 of the Civil Code.

Domingo M. Bailon for petitioners. Hugo Hugo & Associates for private respondents.

SYNOPSIS On 27 April 1955, Gertrudes, married to Adriano Isidro, acquired from the then Department of Agriculture and Natural Resources (DANR) a parcel of land situated at Bo. Sto. Nio, Marikina, Rizal. On 2 March 1956, the property was registered and TCT No. 43100 solely in the name of "Gertrudes Isidro, widow," was issued. On 5 February 1985, Gertrudes obtained a loan from petitioners, secured by a mortgage over the said property. On 11 March 1986, Gertrudes, unable to pay her obligation, executed two contracts in favor of petitioner Alexander Cruz. The first was denominated as "Kasunduan," which the parties conceded was a pacto de retro sale, granting Gertrudes one year within which to repurchase the property. The second was a " Kasunduan ng Tuwirang Bilihan," a Deed of Absolute Sale covering the same property. For failure of Gertrudes to repurchase the property, ownership thereof was consolidated in the name of Alexander Cruz and TCT No. 130584 was issued in his name. On 9 June 1987, Gertrudes Isidro died. Thereafter, her heirs, herein private respondents, received demands to vacate the premises from petitioners. Hence, private respondents filed an action before the Regional Trial Court (RTC) of Pasig seeking the nullification of the contracts of sale as well as the title subsequently issued in the name of petitioners.

SYLLABUS 1. CIVIL LAW; CO-OWNERSHIP; REDEMPTION OF THE PROPERTY BY A CO-OWNER DOES NOT TERMINATE THE CO-OWNERSHIP NOR VEST IN HIM OWNERSHIP OVER ENTIRE PROPERTY. There is no merit in petitioners' contention that Gertrudes' redemption of the property from the Daily Savings Bank vested in her ownership over the same to the exclusion of her co-owners. We dismissed the same argument by one of the petitioners in Paulmitan vs. Court of Appeals, where one of the petitioners therein claimed ownership of the entire property subject of the case by virtue of her redemption thereof after the same was forfeited in favor of the provincial government for non-payment of

taxes. We held, however, that the redemption of the land "did not terminate the coownership nor give her title to the entire land subject of the co-ownership." 2. ID.; LAND REGISTRATION; WHERE A PARCEL OF LAND, FORMING PART OF UNDISTRIBUTED PROPERTIES OF DISSOLVED CONJUGAL PARTNERSHIP OF GAINS, IS SOLD BY A WIDOW TO A PURCHASER WHO MERELY RELIED ON FACE OF CERTIFICATE OF TITLE THERETO, ISSUED SOLELY IN NAME OF WIDOW, PURCHASER ACQUIRES A VALID TITLE THERETO EVEN AS AGAINST HEIRS OF DECEASED SPOUSE; RATIONALE. It is conceded that, as a rule, a co-owner such as Gertrudes could only dispose of her share in the property owned in common. Unfortunately for private respondents, however, the property was registered in TCT No. 43100 solely in the name of "Gertrudes Isidro, widow." Where a parcel of land, forming part of the undistributed properties of the dissolved conjugal partnership of gains, is sold by a widow to a purchaser who merely relied on the face of the certificate of title thereto, issued solely in the name of the widow, the purchaser acquires a valid title to the land even as against the heirs of the deceased spouse. The rationale for this rule is that "a person dealing with registered land is not required to go behind the register to determine the condition of the property. He is only charged with notice of the burdens on the property which are noted on the face of the register or the certificate of title. To require him to do more is to defeat one of the primary objects of the Torrens system." 3. ID.; SALES; PACTO DE RETRO SALE; RECORDING IN REGISTRY OF PROPERTY OF CONSOLIDATION OF OWNERSHIP OF VENDEE IS NOT A CONDITION SINE QUA NON TO TRANSFER OF OWNERSHIP; FAILURE OF VENDEE A RETRO TO CONSOLIDATE HIS TITLE DOES NOT IMPAIR SUCH TITLE. It bears stressing that notwithstanding Article 1607 of the Civil Code, the recording in the Registry of Property of the consolidation of ownership of the vendee is not a condition sine qua non to the transfer of ownership. Petitioners are the owners of the subject property since neither Gertrudes nor her coowners redeemed the same within the one-year period stipulated in the "Kasunduan." The essence of a pacto de retro sale is that title and ownership of the property sold are immediately vested in the vendee a retro, subject to the resolutory condition of repurchase by the vendor a retro within the stipulated period. Failure thus of the vendor a retro to perform said resolutory condition vests upon the vendee by operation of law absolute title and ownership over the property sold. As title is already vested in the vendee a retro, his failure to consolidate his title under Article 1607 of the Civil Code does not impair such title or ownership for the method prescribed thereunder is merely for the purpose of registering the consolidated title.

KAPUNAN, J p: Private respondents, the heirs of spouses Adriano Leis and Gertrudes Isidro, 1 filed an action before the Regional Trial Court (RTC) of Pasig seeking the nullification of the contracts of sale over a lot executed by Gertrudes Isidro in favor of petitioner Alexander Cruz, as well as the title subsequently issued in the name of the latter. Private respondents claimed that the contracts were vitiated by fraud as Gertrudes was illiterate and already 80 years old at the time of the execution of the contracts; that the price for the land was insufficient as it was sold only for P39,083.00 when the fair market value of the lot should be P1,000.00 per square meter, instead of P390.00, more or less; and that the property subject of the sale was conjugal and, consequently, its sale without the knowledge and consent of private respondents was in derogation of their rights as heirs. cda The facts that gave rise to the complaint: Adriano and Gertrudes were married on 19 April 1923. On 27 April 1955, Gertrudes acquired from the then Department of Agriculture and Natural Resources (DANR) a parcel of land with an area of one hundred (100) square meters, situated at Bo. Sto. Nio, Marikina, Rizal and covered by Transfer Certificate of Title (TCT) No. 42245. The Deed of Sale described Gertrudes as a widow. On 2 March 1956, TCT No. 43100 was issued in the name of "Gertrudes Isidro," who was also referred to therein as a "widow." On 2 December 1973, Adriano died. It does not appear that he executed a will before his death. On 5 February 1985, Gertrudes obtained a loan from petitioners, the spouses Alexander and Adelaida Cruz, in the amount of P15,000.00 at 5% interest, payable on or before 5 February 1986. The loan was secured by a mortgage over the property covered by TCT No. 43100. Gertrudes, however, failed to pay the loan on the due date. Unable to pay her outstanding obligation after the debt became due and payable, on 11 March 1986, Gertrudes executed two contracts in favor of petitioner Alexander Cruz. The first is denominated as "Kasunduan," which the parties concede is a pacto de retro sale, granting Gertrudes one year within which to repurchase the property. The second is a "Kasunduan ng Tuwirang Bilihan," a Deed of Absolute Sale covering the same property for the price of P39,083.00, the same amount stipulated in the " Kasunduan." For failure of Gertrudes to repurchase the property, ownership thereof was consolidated in the name of Alexander Cruz in whose name TCT No. 130584 was issued on 21 April 1987, canceling TCT No. 43100 in the name of Gertrudes Isidro.

DECISION

5. Ordering the defendant[s] to pay plaintiff[s] P15,000.00 nominal damages for the violation of plaintiffs' rights; On 9 June 1987, Gertrudes Isidro died. Thereafter, her heirs, herein private respondents, received demands to vacate the premises from petitioners, the new owners of the property. Private respondents responded by filing a complaint as mentioned at the outset. On the basis of the foregoing facts, the RTC rendered a decision in favor of private respondents. The RTC held that the land was conjugal property since the evidence presented by private respondents disclosed that the same was acquired during the marriage of the spouses and that Adriano contributed money for the purchase of the property. Thus, the court concluded, Gertrudes could only sell to petitioner spouses her one-half share in the property. The trial court also ruled that no fraud attended the execution of the contracts. Nevertheless, the "Kasunduan," providing for a sale con pacto de retro, had superseded the "Kasunduan ng Tuwirang Bilihan," the deed of absolute sale. The trial court did not consider the pacto de retro sale an equitable mortgage, despite the allegedly insufficient price. Nonetheless, the trial court found for private respondents. It rationalized that petitioners failed to comply with the provisions of Article 1607 of the Civil Code requiring a judicial order for the consolidation of the ownership in the vendee a retro to be recorded in the Registry of Property. The dispositive portion of the RTC's Decision reads: WHEREFORE, in the light of all the foregoing, judgment is hereby rendered: 1. Declaring Exhibit G "Kasunduan ng Tuwirang Bilihan" Null and Void and declar[ing] that the title issued pursuant thereto is likewise Null and Void; 2. Declaring the property in litigation as conjugal property; 3. Ordering the Registry of Deeds of Marikina Branch to reinstate the title of Gertrudes Isidro; 4. Ordering the plaintiff[s] [sic] to comply with the provision[s] of Article 1607 in relation to Article 1616 of the Civil Code; 6. Ordering the defendant[s] to pay plaintiff[s] the sum of P8,000.00 as and for attorney's fees; 7. Dismissing defendant[s'] counterclaim; and 8. Ordering defendant[s] to pay the cost of suit. SO ORDERED. 2 Petitioners appealed to the Court of Appeals in vain. The Court of Appeals affirmed the decision of the Regional Trial Court, holding that since the property was acquired during the marriage of Gertrudes to Adriano, the same was presumed to be conjugal property under Article 160 of the Civil Code. The appellate court, like the trial court, also noted that petitioner did not comply with the provisions of Article 1607 of the Civil Code. Petitioners are now before this Court seeking the reversal of the decision of the Court of Appeals. First, they contend that the subject property is not conjugal but is owned exclusively by Gertrudes, who was described in the Deed of Sale between Gertrudes and the DANR as well as in TCT No. 43100 as a widow. Second, assuming the land was conjugal property, petitioners argue that the same became Gertrudes' exclusively when, in 1979, she mortgaged the property to the Daily Savings Bank and Loan Association. The bank later foreclosed on the mortgage in 1981 but Gertrudes redeemed the same in 1983. The paraphernal or conjugal nature of the property is not determinative of the ownership of the disputed property. If the property was paraphernal as contended by petitioners, Gertrudes Isidro would have the absolute right to dispose of the same, and absolute title and ownership was vested in petitioners upon the failure of Gertrudes to redeem the property. On the other hand, if the property was conjugal as private respondents maintain, upon the death of Adriano Leis, the conjugal partnership was terminated, 3 entitling Gertrudes to one-half of the property. 4 Adriano's rights to the other half, in turn, were transmitted upon his death to his heirs, 5 which includes his widow Gertrudes, who is entitled to the same share as that of each of the legitimate children. 6 Thus, as a result of the death of Adriano, a regime of co-ownership arose between Gertrudes and the other heirs in relation to the property. Incidentally, there is no merit in petitioners' contention that Gertrudes' redemption of the property from the Daily Savings Bank vested in her ownership over the same to the

exclusion of her co-owners. We dismissed the same argument by one of the petitioners in Paulmitan vs. Court of Appeals, 7 where one of the petitioners therein claimed ownership of the entire property subject of the case by virtue of her redemption thereof after the same was forfeited in favor of the provincial government for non-payment of taxes. We held, however, that the redemption of the land "did not terminate the coownership nor give her title to the entire land subject of the co-ownership." We expounded, quoting our pronouncement in Adille vs. Court of Appeals: 8 The petition raises a purely legal issue: May a co-owner acquire exclusive ownership over the property held in common? LLpr Essentially, it is the petitioner's contention that the property subject of dispute devolved upon him upon the failure of his co-heirs to join him in its redemption within the period required by law. He relies on the provisions of Article 1515 of the old Civil Code, Article 1613 of the present Code, giving the vendee a retro the right to demand redemption of the entire property. There is no merit in this petition. The right of repurchase may be exercised by a co-owner with respect to his share alone (CIVIL CODE, Art. 1612; CIVIL CODE (1889), Art. 1514.). While the records show that petitioner redeemed the property in its entirety, shouldering the expenses therefor, that did not make him the owner of all of it. In other words, it did not put to end the existing state of co-ownership (Supra, Art. 489). There is no doubt that redemption of property entails a necessary expense. Under the Civil Code: ARTICLE 488. Each co-owner shall have a right to compel the other co-owners to contribute to the expenses of preservation of the thing or right owned in common and to the taxes. Any one of the latter may exempt himself from this obligation by renouncing so much of his undivided interest as may be equivalent to his share of the expenses and taxes. No such waiver shall be made if it is prejudicial to the co-ownership. The result is that the property remains to be in a condition of coownership. While a vendee a retro, under Article 1613 of the Code, "may not be compelled to consent to a partial redemption," the redemption by one co-heir or co-owner of the property in its totality does not vest in him ownership over it. Failure on the part of all the

co-owners to redeem it entitles the vendee a retro to retain the property and consolidate title thereto in his name (Supra, Art. 1607). But the provision does not give to the redeeming co-owner the right to the entire property. It does not provide for a mode of terminating a co-ownership. It is conceded that, as a rule, a co-owner such as Gertrudes could only dispose of her share in the property owned in common. Article 493 of the Civil Code provides: ARTICLE 493. Each co-owner shall have the full ownership of his part of the fruits and benefits pertaining thereto, and he may therefore alienate, assign or mortgage it, and even substitute another person in its enjoyment, except when personal rights are involved. But the effect of the alienation or the mortgage, with respect to the coowners, shall be limited to the portion which may be allotted to him in the division upon the termination of the co-ownership. Unfortunately for private respondents, however, the property was registered in TCT No. 43100 solely in the name of "Gertrudes Isidro, widow." Where a parcel of land, forming part of the undistributed properties of the dissolved conjugal partnership of gains, is sold by a widow to a purchaser who merely relied on the face of the certificate of title thereto, issued solely in the name of the widow, the purchaser acquires a valid title to the land even as against the heirs of the deceased spouse. The rationale for this rule is that "a person dealing with registered land is not required to go behind the register to determine the condition of the property. He is only charged with notice of the burdens on the property which are noted on the face of the register or the certificate of title. To require him to do more is to defeat one of the primary objects of the Torrens system." 9 As gleaned from the foregoing discussion, despite the Court of Appeals' finding and conclusion that Gertrudes as well as private respondents failed to repurchase the property within the period stipulated and has lost all their rights to it, it still ruled against petitioners by affirming the Regional Trial Court's decision on the premise that there was no compliance with Article 1607 of the Civil Code requiring a judicial hearing before registration of the property in the name of petitioners. This provision states: ARTICLE 1607. In case of real property, the consolidation of ownership in the vendee by virtue of the failure of the vendor to comply with the provisions of Article 1616 shall not be recorded in the Registry of Property without a judicial order, after the vendor has been duly heard.

The aforequoted article is intended to minimize the evils which the pacto de retro sale has caused in the hands of usurers. A judicial order is necessary in order to determine the true nature of the transaction and to prevent the interposition of buyers in good faith while the determination is being made. 10 It bears stressing that notwithstanding Article 1607, the recording in the Registry of Property of the consolidation of ownership of the vendee is not a condition sine qua non to the transfer of ownership. Petitioners are the owners of the subject property since neither Gertrudes nor her co-owners redeemed the same within the one-year period stipulated in the "Kasunduan." The essence of a pacto de retro sale is that title and ownership of the property sold are immediately vested in the vendee a retro, subject to the resolutory condition of repurchase by the vendor a retro within the stipulated period. Failure thus of the vendor a retro to perform said resolutory condition vests upon the vendee by operation of law absolute title and ownership over the property sold. As title is already vested in the vendee a retro, his failure to consolidate his title under Article 1607 of the Civil Code does not impair such title or ownership for the method prescribed thereunder is merely for the purpose of registering the consolidated title. 11

IGMEDIO AMOJIDO, and THE RURAL BANK OF SANTA BARBARA, defendants-appellees.

Robert B. Maroma for plaintiffs-appellants. Estefano Caspe for defendants-appellees.

SYLLABUS 1. REMEDIAL LAW; CIVIL ACTIONS; BAR BY PRIOR JUDGMENT; CANNOT BE INVOKED WHERE THE EARLIER CASE WAS DISMISSED WITHOUT PREJUDICE; CASE AT BAR. The present action is not barred by prior judgment as the dismissal of the earlier complaint was without prejudice to its refiling at a future date. It appears that when Civil Case No. 3941 was called for hearing, the plaintiffs' counsel himself moved for its dismissal on the ground that his clients had gone to Mindanao and he did not know when they would be returning. There is here no showing of failure to prosecute, such as an unreasonable delay on the part of the complainants, and the appellees have not so contended. It was clear that the plaintiffs' counsel had the intention of reviving the case, and that must have been the impression too of the trial judge because his order of dismissal did not state that it was with prejudice to the refiling of the case. 2. ID.; SPECIAL PROCEEDINGS; SUMMARY SETTLEMENT OF ESTATES; LIABILITY OF DISTRIBUTEES AND ESTATES; TWO YEAR PERIOD OF ASSERTING CLAIM DOES NOT APPLY TO NULL AND VOID PARTITIONS; CASE AT BAR. Section 1 of Rule 74 does not apply to the partition in question which was null and void as far as the plaintiffs were concerned. The rule covers only valid partitions. The partition in the present case was invalid because it excluded six of the nine heirs who were entitled to equal shares in the partitioned property. Under the rule, "no extra-judicial settlement shall be binding upon any person who has not participated therein or had no notice thereof." As the partition was a total nullity and did not affect the excluded heirs, it was not correct for the trial court to hold that their right to challenge the partition had prescribed after two years from its execution in 1941. 3. CIVIL LAW; CO-OWNERSHIP; A CO-OWNER CAN SELL ONLY WHAT HE OWNS AND THE BUYER CAN ACQUIRE NO MORE THAN WHAT THE SELLER CAN LEGALLY TRANSFER. As a person can sell only what he owns or is authorized to sell, the buyer can as a consequence acquire no more than what the seller can legally transfer. The deed of partition being invalid as to the other heirs, the vendors could dispose only of their respective shares in the land, or one-third only of the property and not the other twothirds as well which did not belong to them. (Article 493 of the Civil Code)

WHEREFORE, the decision of the Court of Appeals is MODIFIED in that the petitioners are deemed owners of the property by reason of the failure of the vendor, Gertrudes Isidro, to repurchase the same within the period stipulated. However, Transfer Certificate of Title No. 130584, in the name of Alexander M. Cruz, which was issued without judicial order, is hereby ordered CANCELLED, and Transfer Certificate of Title No. 43100 in the name of Gertrudes Isidro is ordered REINSTATED, without prejudice to compliance by petitioners with the provisions of Article 1607 of the Civil Code. cdphil SO ORDERED.

FIRST DIVISION [G.R. No. L-29320. September 19, 1988.] FELIPE SEGURA, ANTONIA SEGURA, NICANORA SEGURA, BERNARDINA SEGURA, ALIPIO SEGURA and MONSERRAT SEGURA, plaintiffs-appellants, vs. NICOLAS SEGURA, SANTIAGO SEGURA, GAUDENCIO SEGURA, EMILIANO AMOJIDO, MILDRED ELISON VDA. DE JAVELOSA, ERNESTO AMOJIDO, EPIFANIA DE AMOJIDO,

4. ID.; ID.; ID.; AN IMPLIED TRUST IS CREATED WHERE SALE INCLUDES PORTION BELONGING TO DIFFERENT CO-OWNERS. The general rule is that no one can give what he does not have - nemo dat quod non habet. Hence, even if it be assumed that Amojido had bought the land in good faith from the parties to the extrajudicial partition, only so much of their share could be validly acquired by him, with the rest of the property remaining under the ownership of the six excluded co-heirs. In other words, Amojido became pro indiviso co-owner of the land with the other six heirs, who retained title to their respective shares although he had possession of the entire property. The portion pertaining to the herein appellants should be deemed held by Amojido under an implied trust for their benefit, conformably to the ruling in Bargayo v. Camumot. 5. REMEDIAL LAW; ACTIONS; ACTION FOR RECONVEYANCE BASED ON IMPLIED TRUST DOES NOT PRESCRIBE. There is no question that an action for reconveyance of property held in implied trust is imprescriptible. 6. ID.; ID.; ID.; PERIOD BEGINS TO RUN ON DATE CO-OWNERSHIP IS REPUDIATED; PERIOD FIXED AT TEN (10) YEARS. However, this is true only as long as the trustee continues to acknowledge the title of the cestui que trust, or, otherwise stated, provided he does not repudiate such title. The moment he does so, the prescriptive period will begin to run and may eventually operate to divest the real owners of their right to the property after the lapse of the applicable statutory period. Under the provision abovequoted, that period is fixed at ten years, whether the claim be based upon an obligation created by law under Article 1144 or covered by Article 1134 on rights over immovable property. 7. ID.; ID.; ID.; ID.; ISSUANCE OF TRANSFER CERTIFICATE OF TITLE WITHOUT ANNOTATION OF ENCUMBRANCE CONSTITUTES REPUDIATION OF CLAIM OF OTHER HEIRS. When Amojido secured the registration of the land in his name following the deed of sale executed in his favor by the parties to the extrajudicial partition, his certificate of title carried an express reservation of whatever rights might pertain to the other heirs. This annotation constituted an acknowledgment of the possibility that a portion of the land might not belong to him and the commitment that he would be holding such part as impliedly conveyed to him in trust by and for its true owners. However, when Amojido himself sold the land to Mirope Mascareas vda. de Elison on March 13, 1953, the transfer certificate of title issued in her name no longer carried the said encumbrance. By the deletion of this annotation, Mirope, as the new transferee, repudiated as of the date of registration the claim of the other heirs to their shares in the property. From then on her assertion of ownership over the whole land became adverse even as against the appellants herein. And as the certificate of title was notice to the whole world of her exclusive title to the land, such rejection was binding on the said heirs and started as against them the period of prescription.

8. ID.; ID.; ID.; ID.; CASE AT BAR. The record does not show when TCT No. T-19396 in the name of Mirope Mascareas vda. de Elison was issued, but it can be conjectured that this was done before February 14, 1957, when she sold the land to Mildred Elison vda. de Javelosa. On the assumption that the land was registered in the name of Mirope in 1953 following her purchase without acknowledgment of the co-heirs' rights, the 10year prescriptive period would have started from that year. Suspended on May 28, 1956, when the first complaint was filed, it began running again on February 16, 1958, 30 days after it was dismissed, and was completed after seven more years in 1965, two years before the second complaint was filed in 1968. Hence, that complaint was barred by prescription, as correctly held by the trial court, although the different starting point it used, erroneously, was 1941, date of the extrajudicial partition. The unavoidable consequence of all this is that whatever claims the co-heirs could have validly asserted before can no longer be invoked by them at this time. They have let the time inexorably pass while they were slumbering on their rights, and now it is too late.

DECISION

CRUZ, J p: This is another distasteful case where kin is pitted against kin in a bitter dispute over property inherited from a common ancestor who probably would have been distressed to see her progeny quarreling over it as if they were hostile strangers. The land in question consists of 4,060 square meters and was originally registered under Original Certificate of Title No. 1994 in the Registry of Deeds of Iloilo in the name of Gertrudes Zamora. 1 She died intestate and without debts in 1936 and was survived by four children, who never got around to dividing the property among themselves. This controversy is not among the four brothers, who are now also deceased. It is Gertrudes's grandchildren by three of her sons (the fourth having died without issue) who are involved in this complaint for recovery of ownership and possession of the disputed inheritance, plus damages. The conflict began when on April 6, 1941, three of these nine grandchildren, namely, Nicolas, Santiago and Gaudencio Segura, executed a deed of extrajudicial partition arrogating the entire property to themselves alone as equal pro indiviso owners 2 (thereby, curiously, excluding Nicolas and Santiago's own brother and two sisters, and Gaudencio's own sister, besides the other two co-heirs.) This partition was not registered immediately, but only in 1946, or five years later. Before and after such registration, the following developments transpired:

1. The land was sold for P50.00 to Emiliano Amojido, with right to repurchase on or before February 15, 1942. This right was not exercised. 3 2. On November 28, 1946, Amojido executed an affidavit of consolidation of ownership and obtained TCT No. 28336, with a reservation of the rights of the other heirs annotated therein. 4 3. On March 31, 1953, Amojido sold the land for P1,500.00 to Mirope Mascareas vda. de Elison, who obtained TCT No. T-19396 in her name, which did not retain the annotation. 5 4. On May 28, 1956, the plaintiffs filed Civil Case No. 3941, for recovery of possession and ownership of the subject land from Nicolas, Santiago and Gaudencio Segura. 6 5. On February 14, 1957, Elison sold the land for P1,000.00 to Mildred Elison vda. de Javelosa, who obtained TCT No. 22074 in her name. 7 6. On January 15, 1958, Mildred sold the land for P1,500.00 to Ernesto and Igmedio Amojido, who obtained TCT No. 24342 in their names. 8 7. On January 16, 1958, Civil Case No. 3941 was dismissed on motion of the plaintiffs' counsel. 8. On July 23, 1961, the land was mortgaged to the Rural Bank of Sta. Barbara, which is one of the appellees herein. The complaint in the case at bar was filed on January 11, 1968, and docketed as Civil Case No. 7477 in the Court of First Instance of Iloilo. In it, the six excluded grandchildren alleged that the partition and all subsequent transfers of the subject land were null and void insofar as these transactions deprived them of their shares as co-owners of the said property. The defendants moved to dismiss, contending that the action was barred by prior judgment and that in any event whatever rights might have pertained to the plaintiffs had already prescribed under the Rules of Court and the Civil Code. The plaintiffs opposed the motion. Thereafter, issues having been joined, the trial court 9 issued its order of March 28, 1968, dismissing the complaint on the ground of prescription. The motion for reconsideration was denied in an order dated May 28, 1968, on the further ground, as if it were an afterthought, of res judicata. The plaintiffs then appealed to this Court and now ask that the said orders be reversed and the complaint reinstated.

We hold at the outset that the present action is not barred by prior judgment as the dismissal of the earlier complaint was without prejudice to its refiling at a future date. It appears that when Civil Case No. 3941 was called for hearing, the plaintiffs' counsel himself moved for its dismissal on the ground that his clients had gone to Mindanao and he did not know when they would be returning. 10 There is here no showing of failure to prosecute, such as an unreasonable delay on the part of the complainants, and the appellees have not so contended. It was clear that the plaintiffs' counsel had the intention of reviving the case, and that must have been the impression too of the trial judge because his order of dismissal did not state that it was with prejudice to the refiling of the case 11 The applicable rule is Rule 17, Section 2, of the Rules of Court reading thus: "Dismissal by order of the court. Except as provided in the preceding section, an action shall not be dismissed at the plaintiffs instance save upon order of the court and upon such terms and conditions as the court deems proper. If a counterclaim has been pleaded by a defendant prior to the service upon him of the plaintiff's motion to dismiss, the action shall not be dismissed against the defendant's objection unless the counterclaim can remain pending for independent adjudication by the court. Unless otherwise specified in the order, a dismissal under this paragraph shall be without prejudice." It follows that even, if, as noted by the trial court in its Order of May 28, 1968, "the same case Civil Case No. 3941 of this Court. Exh. 'A' with the same subject matter, with the same plaintiffs, almost with the same defendants, and the same theory, was dismissed by this Court on January 16, 1958," the present action is not barred by res judicata. The second ground is not as simple. The claim of prescription is based first on the contention that under the Rules of Court the deed of extrajudicial partition should have been impugned within two years from the date of its execution in 1941. As the challenge in the instant case was made only in 1956, when Civil Case No. 3941 was filed, that first case, and more so the case at bar which was commenced in 1968, should be and were properly dismissed for tardiness under Rule 74, Section 4, of the Rules of Court. This section provides in gist that a person who has been deprived of his lawful participation in the estate of the decedent, whether as heir or as creditor, must assert his claim within two years after the extrajudicial or summary settlement of such estate

under Sections 1 and 2 respectively of the same Rule 74. Thereafter, he will be precluded from doing so as the right will have prescribed. It is clear that Section 1 of Rule 74 does not apply to the partition in question which was null and void as far as the plaintiffs were concerned. The rule covers only valid partitions. The partition in the present case was invalid because it excluded six of the nine heirs who were entitled to equal shares in the partitioned property. Under the rule, "no extra-judicial settlement shall be binding upon any person who has not participated therein or had no notice thereof." As the partition was a total nullity and did not affect the excluded heirs, it was not correct for the trial court to hold that their right to challenge the partition had prescribed after two years from its execution in 1941. The appellees invoke a second basis for their claim of prescription and argue that even under the Civil Code the complaint should also be deemed prescribed pursuant to the following provisions: "Art. 1134. Ownership and other real rights over immovable property are acquired by ordinary prescription through possession of ten years (1957a)." "Art. 1144. The following actions must be brought within ten years from the time the right of action accrues: (1) Upon a written contract; (2) Upon an obligation created by law; (3) Upon a judgment." It is recalled that following the execution of the deed of partition, the owners named therein sold the entire land to Emiliano Amojido who, after the vendors had failed to exercise their right of repurchase, executed an affidavit of consolidation in his favor on November 28, 1946. He subsequently obtained a transfer certificate of title in his name, but this contained the following annotation: "This land is subject to any claim that may be presented by any heir or any other person deprived of his lawful participation in the estate of Gertrudes Zamora, within two years from date of the ExtraJudicial Settlement and distribution of the estate." 12

As a person can sell only what he owns or is authorized to sell, the buyer can as a consequence acquire no more than what the seller can legally transfer. The deed of partition being invalid as to the other heirs, the vendors could dispose only of their respective shares in the land, or one-third only of the property and not the other twothirds as well which did not belong to them. Article 493 of the Civil Code reads as follows: "Each co-owner shall have the full ownership of his part and the fruits and benefits pertaining thereto, and he may therefore alienate, assign or mortgage it, and even substitute another person in its enjoyment, except when personal rights are involved. But the effect of the alienation or the mortgage, with respect to the coowners, shall be limited to the portion which may be allotted to him in the division upon the termination of the co-ownership." Applying this provision, we have held in previous cases:. "When a real property belongs pro indiviso to three persons, who acquired it by inheritance from a common ancestor, the action for recovery by the legal representative of one of the heirs can only concern one-third of the property; and if the other co-owners have, by sale to third person, disposed of one-third of the said pro indiviso property, the plaintiff who sues for recovery is not entitled to ask for the annulment of the sale, inasmuch as the latter merely exercised their rights; such alienation does not affect the rights of the heir who claims only one-third, which belongs to the other two coowners whose rights must be respected by the plaintiff." 13 "Every co-heir has the absolute ownership of his share in the community property and may alienate, assign or mortgage the same, except as to purely personal rights, but the effect of any such transfer is limited to the portion which may be awarded to him upon the partition of the property." 14 "None of the other co-heirs who did not participate in the sale can demand the nullification of the same, inasmuch as every co-owner may alienate, transfer, or mortgage his share in the common thing, and even substitute another person in the enjoyment thereof, unless personal rights are in question; although the effect of the alienation or mortgage, in relation to the co-owners shall be limited

to the portion that may be adjudicated to him when the community ceased." 15 To repeat, the general rule is that no one can give what he does not have nemo dat quod non habet. Hence, even if it be assumed that Amojido had bought the land in good faith from the parties to the extrajudicial partition, only so much of their share could be validly acquired by him, with the rest of the property remaining under the ownership of the six excluded co-heirs. In other words, Amojido became pro indiviso co-owner of the land with the other six heirs, who retained title to their respective shares although he had possession of the entire property. The portion pertaining to the herein appellants should be deemed held by Amojido under an implied trust for their benefit, conformably to the ruling in Bargayo v. Camumot, 16 thus: "In law it is understood that the co-owners or co-heir who is in possession of an inheritance pro indiviso for himself and in representation of his co-owners or co-heirs, if, as such owner, he administers or takes care of the rest thereof with the obligation of delivering it to his co-owners or co-heirs, is under the same situation as a depository, a lessee, or a trustee." There is no question that an action for reconveyance of property held in implied trust is imprescriptible. 17 However, this is true only as long as the trustee continues to acknowledge the title of the cestui que trust, or, otherwise stated, provided he does not repudiate such title. 18 The moment he does so, the prescriptive period will begin to run and may eventually operate to divest the real owners of their right to the property after the lapse of the applicable statutory period. Under the provision above-quoted, that period is fixed at ten years, whether the claim be based upon an obligation created by law under Article 1144 or covered by Article 1134 on rights over immovable property. When did such prescriptive period start in the case at bar? It is noted that when Amojido secured the registration of the land in his name following the deed of sale executed in his favor by the parties to the extrajudicial partition, his certificate of title carried an express reservation of whatever rights might pertain to the other heirs. This annotation constituted an acknowledgment of the possibility that a portion of the land might not belong to him and the commitment that he would be holding such part as impliedly conveyed to him in trust by and for its true owners. However, when Amojido himself sold the land to Mirope Mascareas vda. de Elison on March 13, 1953, the transfer certificate of title issued in her name no longer carried the said encumbrance. By the deletion of this annotation, Mirope, as the new transferee, repudiated as of the date of registration the claim of the other heirs to their shares in the property. From then on her assertion of ownership over the whole land became

adverse even as against the appellants herein. And as the certificate of title was notice to the whole world of her exclusive title to the land, such rejection was binding on the said heirs and started as against them the period of prescription.

The record does not show when TCT No. T-19396 in the name of Mirope Mascareas vda. de Elison was issued, but it can be conjectured that this was done before February 14, 1957, when she sold the land to Mildred Elison vda. de Javelosa. On the assumption that the land was registered in the name of Mirope in 1953 following her purchase without acknowledgment of the co-heirs' rights, the 10-year prescriptive period would have started from that year. Suspended on May 28, 1956, when the first complaint was filed, it began running again on February 16, 1958, 30 days after it was dismissed, and was completed after seven more years in 1965, two years before the second complaint was filed in 1968. Hence, that complaint was barred by prescription, as correctly held by the trial court, although the different starting point it used, erroneously, was 1941, date of the extrajudicial partition. The unavoidable consequence of all this is that whatever claims the co-heirs could have validly asserted before can no longer be invoked by them at this time. They have let the time inexorably pass while they were slumbering on their rights, and now it is too late. WHEREFORE, the appeal is DISMISSED, with costs against the appellants. It is so ordered.

THIRD DIVISION [G.R. No. 61584. November 25, 1992.] DONATO S. PAULMITAN, JULIANA P. FANESA and RODOLFO FANESA, petitioners, vs. COURT OF APPEALS, ALICIO PAULMITAN, ELENA PAULMITAN, ABELINO PAULMITAN, ANITA PAULMITAN, BAKING PAULMITAN, ADELINA PAULMITAN and ANITO PAULMITAN, respondents.

SYLLABUS 1. CIVIL LAW; PROPERTY; CO-OWNERSHIP; SALE BY CO-OWNER OF THING OWNED IN COMMON WITHOUT THE CONSENT OF ALL CO-OWNERS; CONSEQUENCES; CASE AT

BAR. When Donato Paulmitan sold on May 28, 1974 Lot No. 1091 to his daughter Juliana P. Fanesa, he was only a co-owner with respondents and as such, he could only sell that portion which may be allotted to him upon termination of the co-ownership. The sale did not prejudice the rights of respondents to one half (1/2) undivided share of the land which they inherited from their father. It did not vest ownership in the entire land with the buyer but transferred only the seller's pro indiviso share in the property and consequently made the buyer a co-owner of the land until it is partitioned. In Bailon-Casilao v. Court of Appeals, the Court, through Justice Irene R. Cortes, outlined the effects of a sale by one co-owner without the content of all the co-owners, thus: "The rights of a co-owner of a certain property are clearly specified in Article 493 of the Civil Code. Thus: Art. 493. Each co-owner shall have the full ownership of his part and of the fruits and benefits pertaining thereto, and he may therefore alienate, assign or mortgage it and even substitute another person in its enjoyment, except when personal rights are involved. But the effect of the alienation or mortgage, with respect to the co owners, shall be limited to the portion which may be allotted to him in the division upon the termination of the co-ownership. As early as 1923, this Court has ruled that even if a co-owner sells the whole property as his, the sale will affect only his own share but not those of the other co-owners who did not consent to the sale [Punsalan v. Boon Liat, 44 Phil. 320 (1923)]. This is because under the aforementioned codal provision, the sale or other disposition affects only his undivided share and the transferee gets only what would correspond to his grantor in the partition of the thing owned in common. [Ramirez v. Bautista, 14 Phil. 528 (1909)]. Consequently, by virtue of the sales made by Rosalia and Gaudencio Bailon which are valid with respect to their proportionate shares, and the subsequent transfers which culminated in the sale to private respondent Celestino Afable, the said Afable thereby became a co-owner of the disputed parcel of land as correctly held by the lower court since the sales produced the effect of substituting the buyers in the enjoyment thereof [Mainit v. Bandoy, 14 Phil. 730 (1910)]. From the foregoing, it may be deduced that since a co-owner is entitled to sell his undivided share, a sale of the entire property by one co-owner without the consent of the other co-owners is not null and void. However, only the rights of the co-owner-seller are transferred, thereby making the buyer a co-owner of the property." Applying this principle to the case at bar, the sale by petitioner Donato Paulmitan of the land to his daughter, petitioner Juliana P. Fanesa, did not give to the latter ownership over the entire land but merely transferred to her the one half (1/2) undivided share of her father, thug making her the co-owner of the land in question with the respondents, her first cousins. 2. ID.; ID.; ID.; REDEMPTION BY CO-OWNER OF THING OWNED IN COMMON; CONSEQUENCES; CASE AT BAR. The redemption of the land made by Fanesa did not terminate the co-ownership nor give her title to the entire land subject of the coownership. While the records show that petitioner redeemed the property in its entirety, shouldering the expenses therefor, that did not make him the owner of all of it.

In other words, it did not put to end the existing state of co-ownership (Supra, art. 489). There is no doubt that redemption of property entails a necessary expense. Under the Civil Code: ART. 488. Each co-owner shall have a right to compel the other co-owners to contribute to the expenses of preservation of the thing or right owned in common and to the taxes. Any one of the latter may exempt himself from this obligation by renouncing so much of his undivided interest as may be equivalent to his share of the expenses and taxes. No such waiver shall be made if it is prejudicial to the co-ownership. The result is that the property remains to be in a condition of co-ownership. Failure on the part of all the co-owners to redeem it entitles the vendee a retro to retain the property and consolidate title thereto in his name (Supra, art. 1607). But the provision does not give to the redeeming co-owner the right to the entire property. It does not provide for a mode of terminating a co-ownership." Although petitioner Fanesa did not acquire ownership over the entire lot by virtue of the redemption she made, nevertheless, she did acquire the right to be reimbursed for half of the redemption price she paid to the Provincial Government of Negros Occidental on behalf of her co-owners. Until reimbursed, Fanesa holds a lien upon the subject property for the amount due her. 3. ID.; SUCCESSION; RIGHTS TO SUCCESSION TRANSMITTED FROM MOMENT OF DEATH OF DECEDENT; RELATIVE NEAREST IN DEGREE EXCLUDES MORE DISTANT ONES; CASE AT BAR. When Agatona died in 1953, she was survived by two (2) sons, Donato and Pascual. Since it is well-settled by virtue of Article 777 of the Civil Code that "[t]he rights to the succession are transmitted from the moment of the death of the decedent," the right of ownership, not only of Donato but also of Pascual, over their respective shares in the inheritance was automatically and by operation of law vested in them in 1953 when their mother died intestate. At that stage, the children of Donato and Pascual did not yet have any right over the inheritance since "[i]n every inheritance the relative nearest in degree excludes the more distant ones." Donato and Pascual excluded their children as to the right to inherit from Agatona Sagario Paulmitan, their mother. 4. ID.; ID.; BEFORE PARTITION WHOLE ESTATE OF DECEDENT OWNED IN COMMON BY HEIRS; CASE AT BAR. From the time of the death of Agatona Sagario Paulmitan to the subsequent passing away of her son Pascual in 1953, the estate remained unpartitioned. Article 1078 of the Civil Code provides: "Where there are two or more heirs, the whole estate of the decedent is, before its partition, owned in common by such heirs, subject to the payment of debts of the deceased." Donato and Pascual Paulmitan were, therefore, co-owners of the estate left by their mother as no partition was ever made. When Pascual Paulmitan died intestate in 1953, his children, the respondents, succeeded him in the co-ownership of the disputed property. Pascual Paulmitan's right of ownership over an undivided portion of the property passed on to his children, who, from the time of Pascual's death, became co-owners with their uncle Donato over the disputed decedent estate.

5. REMEDIAL LAW; APPEAL; ONLY QUESTIONS OF LAW RAISED IN PETITION FOR REVIEW; FACTUAL FINDINGS OF TRIAL COURT AND COURT OF APPEALS GENERALLY FINAL AND CONCLUSIVE. Petitioners dispute the order of the trial court, which the Court of Appeals affirmed, for them to pay private respondents P5,000.00 per year from 1966 until the partition of the estate which represents the share of private respondents in the fruits of the land. According to petitioners, the land is being leased for P2,000.00 per year only. This assigned error, however, raises a factual question. The settled rule is that only questions of law may be raised in a petition for review. As a general rule, findings of fact made by the trial court and the Court of Appeals are final and conclusive and cannot be reviewed on appeal.

only surviving heir of Agatona Sagario. The affidavit was filed with the Register of Deeds of Negros Occidental who, on August 20, 1963, cancelled OCT No. RO-8376 in the name of Agatona Sagario and issued Transfer Certificate of Title (TCT) No. 35979 in Donato's name. As regards Lot No. 1091, Donato executed on May 28, 1974 a Deed of Sale over the same in favor of petitioner Juliana P. Fanesa, his daughter. 5

DECISION

In the meantime, sometime in 1952, for non-payment of taxes, Lot No. 1091 was forfeited and sold at a public auction, with the Provincial Government of Negros Occidental being the buyer. A Certificate of Sale over the land was executed by the Provincial Treasurer in favor of the Provincial Board of Negros Occidental. 6 On May 29, 1974, Juliana P. Fanesa redeemed the property from the Provincial Government of Negros Occidental for the amount of P2,959.09. 7 On learning of these transactions, respondents children of the Late Pascual Paulmitan filed on January 18, 1975 with the Court of First Instance of Negros Occidental a Complaint against petitioners to partition the properties plus damages. Cdpr Petitioners set up the defense of prescription with respect to Lot No. 757 as an affirmative defense, contending that the Complaint was filed more than eleven years after the issuance of a transfer certificate of title to Donato Paulmitan over the land as a consequence of the registration with the Register of Deeds, of Donato's affidavit extrajudicially adjudicating unto himself Lot No. 757. As regards Lot No. 1091, petitioner Juliana P. Fanesa claimed in her Answer to the Complaint that she acquired exclusive ownership thereof not only by means of a deed of sale executed in her favor by her father, petitioner Donato Paulmitan, but also by way of redemption from the Provincial Government of Negros Occidental. Acting on the petitioners' affirmative defense of prescription with respect to Lot No. 757, the trial court issued an order dated April 22, 1976 dismissing the complaint as to the said property upon finding merit in petitioners' affirmative defense. This order, which is not the object of the present petition, has become final after respondents' failure to appeal therefrom. Trial proceeded with respect to Lot No. 1091. In a decision dated May 20, 1977, the trial court decided in favor of respondents as to Lot No. 1091. According to the trial court, the respondents, as descendants of Agatona Sagario Paulmitan were entitled to one-

ROMERO, J p: This is a petition for review on certiorari seeking the reversal of the decision 1 of the Court of Appeals, dated July 14, 1982 in CA-G.R. No. 62255-R entitled "Alicio Paulmitan, et al. v. Donato Sagario Paulmitan, et al." which affirmed the decision 2 of the then Court of First Instance (now RTC) of Negros Occidental, 12th Judicial District, Branch IV, Bacolod City, in Civil Case No. 11770. The antecedent facts are as follows: Agatona Sagario Paulmitan, who died sometime in 1953, 3 left the two following parcels of land located in the Province of Negros Occidental: (1) Lot No. 757 with an area of 1,946 square meters covered by Original Certificate of Title (OCT) No. RO-8376; and (2) Lot No. 1091 with an area of 69,080 square meters and covered by OCT No. RO-11653. From her marriage with Ciriaco Paulmitan, who is also now deceased, Agatona begot two legitimate children, namely: Pascual Paulmitan, who also died in 1953, 4 apparently shortly after his mother passed away, and Donato Paulmitan, who is one of the petitioners. Petitioner Juliana P. Fanesa is Donato's daughter while the third petitioner, Rodolfo Fanesa, is Juliana's husband. Pascual Paulmitan, the other son of Agatona Sagario, is survived by the respondents, who are his children, namely: Alicio, Elena, Abelino, Adelina, Anita, Baking and Anito, all surnamed Paulmitan. Until 1963, the estate of Agatona Sagario Paulmitan remained unsettled and the titles to the two lots mentioned above remained in the name of Agatona. However, on August 11, 1963, petitioner Donato Paulmitan executed an Affidavit of Declaration of Heirship, extrajudicially adjudicating unto himself Lot No. 757 based on the claim that he is the

half (1/2) of Lot No. 1091, pro indiviso. The sale by petitioner Donato Paulmitan to his daughter, petitioner Juliana P. Fanesa, did not prejudice their rights. And the repurchase by Juliana P. Fanesa of the land from the Provincial Government of Negros Occidental did not vest in Juliana exclusive ownership over the entire land but only gave her the right to be reimbursed for the amount paid to redeem the property. The trial court ordered the partition of the land and directed petitioners Donato Paulmitan and Juliana P. Fanesa to pay private respondents certain amounts representing the latter's share in the fruits of the land. On the other hand, respondents were directed to pay P1,479.55 to Juliana P. Fanesa as their share in the redemption price paid by Fanesa to the Provincial Government of Negros Occidental. The dispositive portion of the trial court's decision reads: "WHEREFORE, judgment is hereby rendered on the second cause of action pleaded in the complaint as follows: "1. The deed of sale (Exh. 'F') dated May 28, 1974 is valid insofar as the one-half undivided portion of Lot 1091 is concerned as to vest ownership over said half portion in favor of defendant Juliana Fanesa and her husband Rodolfo Fanesa, while the remaining half shall belong to plaintiffs, pro-indiviso; "2. Lot 1091, Cadastral Survey of Pontevedra, Province of Negros Occidental, now covered by TCT No. RO-11653 (N.A.), is ordered partitioned. The parties must proceed to an actual partition by property instrument of partition, submitting the corresponding subdivision within sixty (60) days from finality of this decision, and should they fail to agree, commissioners of partition may be appointed by the Court; "3. Pending the physical partition, the Register of Deeds of Negros Occidental is ordered to cancel Original Certificate of Title No. RO11653 (N.A.) covering Lot 1091, Pontevedra Cadastre, and to issue in lieu thereof a new certificate of title in the name of plaintiffs and defendants, one half portion each, pro-indiviso, as indicated in paragraph 1 above; "4. Plaintiffs are ordered to pay, jointly and severally, defendant Juliana Fanesa the amount of P1,479.55 with interest at the legal rate from May 28, 1974 until paid; "5. Defendants Donato Sagario Paulmitan and Juliana Paulmitan Fanesa are ordered to account to plaintiffs and to pay them, jointly

and severally, the value of the produce from Lot 1091 representing plaintiffs' share in the amount of P5,000.00 per year from 1966 up to the time of actual partition of the property, and to pay them the sum of P2,000.00 as attorney's fees as well as the costs of the suit." xxx xxx xxx On appeal, the Court of Appeals affirmed the trial court's decision. Hence this petition. To determine the rights and obligations of the parties to the land in question, it is well to review, initially, the relatives who survived the decedent Agatona Sagario Paulmitan. When Agatona died in 1953, she was survived by two (2) sons, Donato and Pascual. A few months later in the same year, Pascual died, leaving seven children, the private respondents. On the other hand, Donato's sole offspring was petitioner Juliana P. Fanesa. At the time of the relevant transactions over the properties of decedent Agatona Sagario Paulmitan, her son Pascual had died, survived by respondents, his children. It is, thus, tempting to apply the principles pertaining to the right of representation as regards respondents. It must, however, be borne in mind that Pascual did not predecease his mother 8 thus precluding the operation of the provisions in the Civil Code on the right of representation 9 with respect to his children, the respondents. When Agatona Sagario Paulmitan died intestate in 1952, her two (2) sons Donato and Pascual were still alive. Since it is well-settled by virtue of Article 777 of the Civil Code that "[t]he rights to the succession are transmitted from the moment of the death of the decedent," 10 the right of ownership, not only of Donato but also of Pascual, over their respective shares in the inheritance was automatically and by operation of law vested in them in 1953 when their mother died intestate. At that stage, the children of Donato and Pascual did not yet have any right over the inheritance since "[i]n every inheritance the relative nearest in degree excludes the more distant ones." 11 Donato and Pascual excluded their children as to the right to inherit from Agatona Sagario Paulmitan, their mother. cdll From the time of the death of Agatona Sagario Paulmitan to the subsequent passing away of her son Pascual in 1953, the estate remained unpartitioned. Article 1078 of the Civil Code provides: "Where there are two or more heirs, the whole estate of the decedent is, before its partition, owned in common by such heirs, subject to the 12 payment of debts of the deceased." Donato and Pascual Paulmitan were, therefore, co-owners of the estate left by their mother as no partition was ever made. When Pascual Paulmitan died intestate in 1953, his children, the respondents, succeeded him in the co-ownership of the disputed property. Pascual Paulmitan's right

of ownership over an undivided portion of the property passed on to his children, who, from the time of Pascual's death, became co-owners with their uncle Donato over the disputed decedent estate. Petitioner Juliana P. Fanesa claims ownership over Lot No. 1091 by virtue of two transactions, namely: (a) the sale made in her favor by her father Donato Paulmitan; and (b) her redemption of the land from the Provincial Government of Negros Occidental after it was forfeited for non-payment of taxes. When Donato Paulmitan sold on May 28, 1974 Lot No. 1091 to his daughter Juliana P. Fanesa, he was only a co-owner with respondents and as such, he could only sell that portion which may be allotted to him upon termination of the co-ownership. 13 The sale did not prejudice the rights of respondents to one half (1/2) undivided share of the land which they inherited from their father. It did not vest ownership in the entire land with the buyer but transferred only the seller's pro indiviso share in the property 14 and consequently made the buyer a co-owner of the land until it is partitioned. In BailonCasilao v. Court of Appeals, 15 the Court, through Justice Irene R. Cortes, outlined the effects of a sale by one co-owner without the content of all the co-owners, thus: "The rights of a co-owner of a certain property are clearly specified in Article 493 of the Civil Code. Thus: ARTICLE 493. Each co-owner shall have the full ownership of his part and of the fruits and benefits pertaining thereto, and he may therefore alienate, assign or mortgage it and even substitute another person in its enjoyment, except when personal rights are involved. But the effect of the alienation or mortgage, with respect to the co owners, shall be limited to the portion which may be allotted to him in the division upon the termination of the coownership. [Emphasis supplied.]. As early as 1923, this Court has ruled that even if a co-owner sells the whole property as his, the sale will affect only his own share but not those of the other co-owners who did not consent to the sale [Punsalan v. Boon Liat, 44 Phil. 320 (1923)]. This is because under the aforementioned codal provision, the sale or other disposition affects only his undivided share and the transferee gets only what would correspond to his grantor in the partition of the thing owned in common. [Ramirez v. Bautista, 14 Phil. 528 (1909)]. Consequently, by virtue of the sales made by Rosalia and Gaudencio Bailon which are valid with respect to their proportionate shares, and the subsequent transfers which culminated in the sale to private

respondent Celestino Afable, the said Afable thereby became a coowner of the disputed parcel of land as correctly held by the lower court since the sales produced the effect of substituting the buyers in the enjoyment thereof [Mainit v. Bandoy, 14 Phil. 730 (1910)]. From the foregoing, it may be deduced that since a co-owner is entitled to sell his undivided share, a sale of the entire property by one co-owner without the consent of the other co-owners is not null and void. However, only the rights of the co-owner-seller are transferred, thereby making the buyer a co-owner of the property." Applying this principle to the case at bar, the sale by petitioner Donato Paulmitan of the land to his daughter, petitioner Juliana P. Fanesa, did not give to the latter ownership over the entire land but merely transferred to her the one half (1/2) undivided share of her father, thug making her the co-owner of the land in question with the respondents, her first cousins. Petitioner Juliana P. Fanesa also claims ownership of the entire property by virtue of the fact that when the Provincial Government of Negros Occidental bought the land after it was forfeited for non-payment of taxes, she redeemed it. The contention is without merit. The redemption of the land made by Fanesa did not terminate the co-ownership nor give her title to the entire land subject of the co-ownership. Speaking on the same issue raised by petitioners, the Court, in Adille v. Court of Appeals, 16 resolved the same with the following pronouncements: "The petition raises a purely legal issue: May a co-owner acquire exclusive ownership over the property held in common? Essentially, it is the petitioners' contention that the property subject of dispute devolved upon him upon the failure of his co-heirs to join him in its redemption within the period required by law. He relies on the provisions of Article 1515 of the old Civil Code, Article 1613 of the present Code, giving the vendee a retro the right to demand redemption of the entire property. There is no merit in this petition.

The right of repurchase may be exercised by a co-owner with respect to his share alone (CIVIL CODE, art. 1612; CIVIL CODE (1889), art. 1514.). While the records show that petitioner redeemed the property in its entirety, shouldering the expenses therefor, that did not make him the owner of all of it. In other words, it did not put to end the existing state of co-ownership (Supra, art. 489). There is no doubt that redemption of property entails a necessary expense. Under the Civil Code: ARTICLE 488. Each co-owner shall have a right to compel the other co-owners to contribute to the expenses of preservation of the thing or right owned in common and to the taxes. Any one of the latter may exempt himself from this obligation by renouncing so much of his undivided interest as may be equivalent to his share of the expenses and taxes. No such waiver shall be made if it is prejudicial to the co-ownership. The result is that the property remains to be in a condition of coownership. While a vendee a retro, under Article 1613 of the Code, "may not be compelled to consent to a partial redemption," the redemption by one co-heir or co-owner of the property in its totality does not vest in him ownership over it. Failure on the part of all the co-owners to redeem it entitles the vendee a retro to retain the property and consolidate title thereto in his name (Supra, art. 1607). But the provision does not give to the redeeming co-owner the right to the entire property. It does not provide for a mode of terminating a co-ownership." Although petitioner Fanesa did not acquire ownership over the entire lot by virtue of the redemption she made, nevertheless, she did acquire the right to be reimbursed for half of the redemption price she paid to the Provincial Government of Negros Occidental on behalf of her co-owners. Until reimbursed, Fanesa holds a lien upon the subject property for the amount due her. 17 Finally, petitioners dispute the order of the trial court, which the Court of Appeals affirmed, for them to pay private respondents P5,000.00 per year from 1966 until the partition of the estate which represents the share of private respondents in the fruits of the land. According to petitioners, the land is being leased for P2,000.00 per year only. This assigned error, however, raises a factual question. The settled rule is that only questions of law may be raised in a petition for review. As a general rule, findings of fact made by the trial court and the Court of Appeals are final and conclusive and cannot be reviewed on appeal. 18

WHEREFORE, the petition is DENIED and the decision of the Court of Appeals AFFIRMED. SO ORDERED.

EN BANC [G.R. No. 152766. June 20, 2003.] LILIA SANCHEZ, petitioner, vs. COURT OF APPEALS, HON. VICTORINO S. ALVARO as Presiding Judge, RTC-Br. 120, Caloocan City, and VIRGINIA TERIA, respondents.

Noel S. Sorreda for petitioner. Felizardo M. Mercado for private respondent.

SYNOPSIS Petitioner and five others were co-owners of a parcel of land registered under TCT No. 263624. The lot was subsequently sold and registered in the name of private respondent by virtue of a Deed of Absolute Sale supposed to have been executed in her favor by all six co-owners. Petitioner, however, refused to vacate the lot claiming that she did not affix her signature on the said Deed. Hence, private respondent filed an action for recovery of possession of the aforesaid lot before the Metropolitan Trial Court of Caloocan City. The MeTC ruled in favor of private respondent declaring that the sale was valid only to the extent of 5/6 of the lot and the other 1/6 remaining as the property of petitioner. On appeal, the RTC required the parties to file their respective memoranda of appeal. Counsel for petitioner did not comply with this order, nor even inform her of the developments in her case. Petitioner not having filed any pleading, the trial court affirmed the decision of the MeTC. Thereafter, private respondent demolished petitioner's house from the lot. Hence, petitioner filed her Petition for Relief from Judgment with the RTC on the ground that she was not bound by the inaction of her counsel. The RTC denied the petition. Petitioner's petition for certiorari and subsequent motion for reconsideration were likewise denied by the Court of Appeals. Hence, this petition for certiorari. The Supreme Court suspended the Rules in this case since the procedural infirmity was not entirely attributable to the fault or negligence of petitioner. According to the Court,

a notice to a lawyer who appears to have been unconscionably irresponsible cannot be considered as notice to his client. Thus, despite the procedural lapses and in the interest of substantial justice, the Court looked into the merits of the petition to put an end to the dispute on the property held in common. It held that before the partition of a land or thing held in common, no individual or co-owner can claim title to any definite portion thereof. All that the co-owner has is an ideal or abstract quota or proportionate share in the entire land or thing. Here, although assigned an aliquot but abstract part of the property, the metes and bounds of petitioner's lot has not been designated. As she was not a party to the Deed of Absolute Sale voluntarily entered into by the other coowners, her right to 1/6 of the property must be respected. Partition needs to be effected to protect her right to her definite share and determine the boundaries of her property. Such partition must be done without prejudice to the rights of private respondent as buyer of the 5/6 portion of the lot under dispute.

SYLLABUS 1. REMEDIAL LAW; SPECIAL CIVIL ACTIONS; PETITION FOR CERTIORARI; GROUNDS. As a matter of policy, the original jurisdiction of this Court to issue the so-called extraordinary writs should generally be exercised relative to actions or proceedings before the Court of Appeals or before constitutional or other tribunals or agencies the acts of which for some reason or other are not controllable by the Court of Appeals. Where the issuance of the extraordinary writ is also within the competence of the Court of Appeals or the Regional Trial Court, it is either of these courts that the specific action for the procurement of the writ must be presented. However, this Court must be convinced thoroughly that two (2) grounds exist before it gives due course to a certiorari petition under Rule 65: (a) The tribunal, board or officer exercising judicial or quasijudicial functions has acted without or in excess of its or his jurisdiction; and (b) There is no appeal nor any plain, speedy and adequate remedy in the ordinary course of law. 2. ID.; RULES OF PROCEDURE; LIBERALLY CONSTRUED TO EFFECT SUBSTANTIAL JUSTICE; LITIGATIONS SHOULD BE DECIDED ON THEIR MERITS NOT ON MERE TECHNICALITIES. Despite the procedural lapses present in this case, we are giving due course to this petition as there are matters that require immediate resolution on the merits to effect substantial justice. The Rules of Court should be liberally construed in order to promote their object of securing a just, speedy and inexpensive disposition of every action or proceeding. The rules of procedure should be viewed as mere tools designed to aid the courts in the speedy, just and inexpensive determination of the cases before them. Liberal construction of the rules and the pleadings is the controlling principle to effect substantial justice. Litigations should, as much as possible, be decided on their merits and not on mere technicalities.

3. ID.; ID.; ID.; RATIONALE. The rationale for this approach is explained in Ginete v. Court of Appeals This Court may suspend its own rules or exempt a particular case from its operation where the appellate court failed to obtain jurisdiction over the case owing to appellant's failure to perfect an appeal. Hence, with more reason would this Court suspend its own rules in cases where the appellate court has already obtained jurisdiction over the appealed case. This prerogative to relax procedural rules of the most mandatory character in terms of compliance, such as the period to appeal has been invoked and granted in a considerable number of cases . . . Let it be emphasized that the rules of procedure should be viewed as mere tools designed to facilitate the attainment of justice. Their strict and rigid application, which would result in technicalities that tend to frustrate rather than promote substantial justice, must always be eschewed. Even the Rules of Court reflect this principle. The power to suspend or even disregard rules can be so pervasive and compelling as to alter even that which this Court itself has already declared to be final, as we are now constrained to do in the instant case . . . The emerging trend in the rulings of this Court is to afford every party litigant the amplest opportunity for the proper and just determination of his cause, free from the constraints of technicalities. Time and again, this Court has consistently held that rules must not be applied rigidly so as not to override substantial justice. 4. ID.; ID.; LIBERALLY CONSTRUED WHERE COUNSEL WAS NEGLIGENT IN NOT ADEQUATELY PROTECTING HIS CLIENT'S INTEREST; NOTICE TO IRRESPONSIBLE LAWYER CANNOT BE CONSIDERED AS NOTICE TO HIS CLIENT. Verily, the negligence of petitioner's counsel cannot be deemed as negligence of petitioner herself in the case at bar. A notice to a lawyer who appears to have been unconscionably irresponsible cannot be considered as notice to his client. Under the peculiar circumstances of this case, it appears from the records that counsel was negligent in not adequately protecting his client's interest, which necessarily calls for a liberal construction of the Rules. 5. ID.; ID.; SUSPENSION THEREOF AND REVIEW OF LOWER COURT'S FACTUAL FINDINGS, WHEN WARRANTED. Aside from matters of life, liberty, honor or property which would warrant the suspension of the Rules of the most mandatory character and an examination and review by the appellate court of the lower court's findings of fact, the other elements that should be considered are the following: (a) the existence of special or compelling circumstances, (b) the merits of the case, (c) a cause not entirely attributable to the fault or negligence of the party favored by the suspension of the rules, (d) a lack of any showing that the review sought is merely frivolous and dilatory, and (e) the other party will not be unjustly prejudiced thereby. 6. ID.; ID.; SUSPENSION THEREOF WARRANTED WHERE PROCEDURAL INFIRMITY WAS NOT ENTIRELY ATTRIBUTABLE TO FAULT OF PETITIONER. The suspension of the Rules is warranted in this case since the procedural infirmity was not entirely attributable to the fault or negligence of petitioner. Besides, substantial justice requires that we go into

the merits of the case to resolve the present controversy that was brought about by the absence of any partition agreement among the parties who were co-owners of the subject lot in question. Hence, giving due course to the instant petition shall put an end to the dispute on the property held in common. 7. CIVIL LAW; CO-OWNERSHIP; DEFINED. Sanchez Roman defines co-ownership as "the right of common dominion which two or more persons have in a spiritual part of a thing, not materially or physically divided. Manresa defines it as the "manifestation of the private right of ownership, which instead of being exercised by the owner in an exclusive manner over the things subject to it, is exercised by two or more owners and the undivided thing or right to which it refers is one and the same." 8. ID.; ID.; CHARACTERISTICS. The characteristics of co-ownership are: (a) plurality of subjects, who are the co-owners, (b) unity of or material indivision, which means that there is a single object which is not materially divided, and which is the element which binds the subjects, and, (c) the recognition of ideal shares, which determines the rights and obligations of the co-owners. 9. ID.; ID.; EVERY CO-OWNER IS A TRUSTEE FOR THE OTHERS. In co-ownership, the relationship of such co-owner to the other co-owners is fiduciary in character and attribute. Whether established by law or by agreement of the co-owners, the property or thing held pro-indiviso is impressed with a fiducial nature so that each co-owner becomes a trustee for the benefit of his co-owners and he may not do any act prejudicial to the interest of his co-owners. Thus, the legal effect of an agreement to preserve the properties in co-ownership is to create an express trust among the heirs as co-owners of the properties. Co-ownership is a form of trust and every co-owner is a trustee for the others. aCHDST

abstract part of the property, the metes and bounds of petitioner's lot has not been designated. As she was not a party to the Deed of Absolute Sale voluntarily entered into by the other co-owners, her right to 1/6 of the property must be respected. Partition needs to be effected to protect her right to her definite share and determine the boundaries of her property. Such partition must be done without prejudice to the rights of private respondent Virginia Teria as buyer of the 5/6 portion of the lot under dispute.

DECISION

BELLOSILLO, J p: This is a Special Civil Action for Certiorari under Rule 65 of the Rules of Court to annul and set aside the Decision of the Court of Appeals dated 23 May 2001 as well as its Resolution dated 8 January 2002 in CA-G.R. SP No. 59182. Lilia Sanchez, petitioner, constructed a house on a 76-square meter lot owned by her parents-in-law. The lot was registered under TCT No. 263624 with the following coowners: Eliseo Sanchez married to Celia Sanchez, Marilyn Sanchez married to Nicanor Montalban, Lilian Sanchez, widow, Nenita Sanchez, single, Susana Sanchez married to Fernando Ramos, and Felipe Sanchez. 1 On 20 February 1995, the lot was registered under TCT No 289216 in the name of private respondent Virginia Teria by virtue of a Deed of Absolute Sale supposed to have been executed on 23 June 1995 2 by all six (6) co-owners in her favor. 3 Petitioner claimed that she did not affix her signature on the document and subsequently refused to vacate the lot, thus prompting private respondent Virginia Teria to file an action for recovery of possession of the aforesaid lot with the Metropolitan Trial Court (MeTC) of Caloocan City sometime in September 1995, subsequently raffled to Br. 49 of that court. On 12 February 1998, the MeTC-Br. 49 of Caloocan City ruled in favor of private respondent declaring that the sale was valid only to the extent of 5/6 of the lot and the other 1/6 remaining as the property of petitioner, on account of her signature in the Deed of Absolute Sale having been established as a forgery. Petitioner then elevated her appeal to the Regional Trial Court of Caloocan City, subsequently assigned to Br. 120, which ordered the parties to file their respective memoranda of appeal. Counsel for petitioner did not comply with this order, nor even inform her of the developments in her case. Petitioner not having filed any pleading with the RTC of Caloocan City, the trial court affirmed the 27 July 1998 decision of the MeTC.

10. ID.; ID.; CO-OWNER CANNOT ALIENATE A CONCRETE, SPECIFIC OR DETERMINATE PART OF THE THING OWNED IN COMMON; CO-OWNER'S RIGHT OVER THE THING IS REPRESENTED BY A QUOTA OR IDEAL PORTION WITHOUT ANY PHYSICAL ADJUDICATION; CASE AT BAR. Before the partition of a land or thing held in common, no individual or co-owner can claim title to any definite portion thereof. All that the coowner has is an ideal or abstract quota or proportionate share in the entire land or thing. Article 493 of the Civil Code gives the owner of an undivided interest in the property the right to freely sell and dispose of it, i.e., his undivided interest. He may validly lease his undivided interest to a third party independently of the other coowners. But he has no right to sell or alienate a concrete, specific or determinate part of the thing owned in common because his right over the thing is represented by a quota or ideal portion without any physical adjudication. Although assigned an aliquot but

On 4 November 1998, the MeTC issued an order for the issuance of a writ of execution in favor of private respondent Virginia Teria, buyer of the property. On 4 November 1999 or a year later, a Notice to Vacate was served by the sheriff upon petitioner who however refused to heed the Notice. On 28 April 1999 private respondent started demolishing petitioner's house without any special permit of demolition from the court. Due to the demolition of her house which continued until 24 May 1999 petitioner was forced to inhabit the portion of the premises that used to serve as the house's toilet and laundry area. On 29 October 1999 petitioner filed her Petition for Relief from Judgment with the RTC on the ground that she was not bound by the inaction of her counsel who failed to submit petitioner's appeal memorandum. However the RTC denied the Petition and the subsequent Motion for Reconsideration. On 14 June 2000 petitioner filed her Petition for Certiorari with the Court of Appeals alleging grave abuse of discretion on the part of the court a quo. On 23 May 2001 the appellate court dismissed the petition for lack of merit. On 18 June 2001 petitioner filed a Motion for Reconsideration but the Court of Appeals denied the motion in its Resolution of 8 January 2002. The only issue in this case is whether the Court of Appeals committed grave abuse of discretion in dismissing the challenged case before it. AIECSD As a matter of policy, the original jurisdiction of this Court to issue the so-called extraordinary writs should generally be exercised relative to actions or proceedings before the Court of Appeals or before constitutional or other tribunals or agencies the acts of which for some reason or other are not controllable by the Court of Appeals. Where the issuance of the extraordinary writ is also within the competence of the Court of Appeals or the Regional Trial Court, it is either of these courts that the specific action for the procurement of the writ must be presented. However, this Court must be convinced thoroughly that two (2) grounds exist before it gives due course to a certiorari petition under Rule 65: (a) The Tribunal, board or officer exercising judicial or quasijudicial functions has acted without or in excess of its or his jurisdiction; and (b) There is no appeal nor any plain, speedy and adequate remedy in the ordinary course of law.

Despite the procedural lapses present in this case, we are giving due course to this petition as there are matters that require immediate resolution on the merits to effect substantial justice. The Rules of Court should be liberally construed in order to promote their object of securing a just, speedy and inexpensive disposition of every action or proceeding. 4 The rules of procedure should be viewed as mere tools designed to aid the courts in the speedy, just and inexpensive determination of the cases before them. Liberal construction of the rules and the pleadings is the controlling principle to effect substantial justice. 5 Litigations should, as much as possible, be decided on their merits and not on mere technicalities. 6 Verily, the negligence of petitioner's counsel cannot be deemed as negligence of petitioner herself in the case at bar. A notice to a lawyer who appears to have been unconscionably irresponsible cannot be considered as notice to his client. 7 Under the peculiar circumstances of this case, it appears from the records that the counsel was negligent in not adequately protecting his client's interest, which necessarily calls for a liberal construction of the Rules. The rationale for this approach is explained in Ginete v. Court of Appeals 8 This Court may suspend its own rules or exempt a particular case from its operation where the appellate court failed to obtain jurisdiction over the case owing to appellant's failure to perfect an appeal. Hence, with more reason would this Court suspend its own rules in cases where the appellate court has already obtained jurisdiction over the appealed case. This prerogative to relax procedural rules of the most mandatory character in terms of compliance, such as the period to appeal has been invoked and granted in a considerable number of cases . . . Let it be emphasized that the rules of procedure should be viewed as mere tools designed to facilitate the attainment of justice. Their strict and rigid application, which would result in technicalities that tend to frustrate rather than promote substantial justice, must always be eschewed. Even the Rules of Court reflect this principle. The power to suspend or even disregard rules can be so pervasive and compelling as to alter even that which this Court itself has already declared to be final, as we are now constrained to do in the instant case . . .

The emerging trend in the rulings of this Court is to afford every party litigant the amplest opportunity for the proper and just determination of his cause, free from the constraints of technicalities. Time and again, this Court has consistently held that rules must not be applied rigidly so as not to override substantial justice. Aside from matters of life, liberty, honor or property which would warrant the suspension of the Rules of the most mandatory character and an examination and review by the appellate court of the lower court's findings of fact, the other elements that should be considered are the following: (a) the existence of special or compelling circumstances, (b) the merits of the case, (c) a cause not entirely attributable to the fault or negligence of the party favored by the suspension of the rules, (d) a lack of any showing that the review sought is merely frivolous and dilatory, and (e) the other party will not be unjustly prejudiced thereby. 9 The suspension of the Rules is warranted in this case since the procedural infirmity was not entirely attributable to the fault or negligence of petitioner. Besides, substantial justice requires that we go into the merits of the case to resolve the present controversy that was brought about by the absence of any partition agreement among the parties who were co-owners of the subject lot in question. Hence, giving due course to the instant petition shall put an end to the dispute on the property held in common. DEaCSA In People's Homesite and Housing Corporation v. Tiongco 10 we held: There should be no dispute regarding the doctrine that normally notice to counsel is notice to parties, and that such doctrine has beneficent effects upon the prompt dispensation of justice. Its application to a given case, however, should be looked into and adopted, according to the surrounding circumstances; otherwise, in the court's desire to make short-cut of the proceedings, it might foster, wittingly or unwittingly, dangerous collusions to the detriment of justice. It would be then be easy for one lawyer to sell one's rights down the river, by just alleging that he just forgot every process of the court affecting his clients, because he was so busy. Under this circumstance, one should not insist that a notice to such irresponsible lawyer is also a notice to his clients. Thus, we now look into the merits of the petition. This case overlooks a basic yet significant principle of civil law: co-ownership. Throughout the proceedings from the MeTC to the Court of Appeals, the notion of co-

ownership 11 was not sufficiently dealt with. We attempt to address this controversy in the interest of substantial justice. Certiorari should therefore be granted to cure this grave abuse of discretion. Sanchez Roman defines co-ownership as "the right of common dominion which two or more persons have in a spiritual part of a thing, not materially or physically divide. 12 Manresa defines it as the "manifestation of the private right of ownership, which instead of being exercised by the owner in an exclusive manner over the things subject to it, is exercised by two or more owners and the undivided thing or right to which it refers is one and the same." 13 The characteristics of co-ownership are: (a) plurality of subjects, who are the co-owners, (b) unity of or material indivision, which means that there is a single object which is not materially divided, and which is the element which binds the subjects, and, (c) the recognition of ideal shares, which determines the rights and obligations of the coowners. 14 In co-ownership, the relationship of such co-owner to the other co-owners is fiduciary in character and attribute. Whether established by law or by agreement of the co-owners, the property or thing held pro-indiviso is impressed with a fiducial nature so that each co-owner becomes a trustee for the benefit of his co-owners and he may not do any act prejudicial to the interest of his co-owners. 15 Thus, the legal effect of an agreement to preserve the properties in co-ownership is to create an express trust among the heirs as co-owners of the properties. Co-ownership is a form of trust and every co-owner is a trustee for the others. 16 Before the partition of a land or thing held in common, no individual or co-owner can claim title to any definite portion thereof. All that the co-owner has is an ideal or abstract quota proportionate share in the entire land or thing. 17 Article 493 of the Civil Code gives the owner of an undivided interest in the property the right to freely sell and dispose of it, i.e., his undivided interest. He may validly lease his undivided interest to a third party independently of the others co-owners. 18 But he has no right to sell or alienate a concrete, specific or determinate part of the thing owned in common because his right over thing is represented by quota or ideal portion without any physical adjudication. 19 Although assigned an aliquot but abstract part of the property, the metes and bounds of petitioner's lot has not been designated. As she was not a party to the Deed of Absolute Sale voluntarily entered into by the other co-owners, her right to 1/6 of the property must be respected. Partition needs to be effected to protect her right to her definite

share and determine the boundaries of her property. Such partition must be done without prejudice to the rights of private respondent Virginia Teria as buyer of 5/6 portion of the lot under dispute. WHEREFORE, the Petition is GRANTED. The Decision of the Court of appeals dated 23 May 2001 as well as its Resolution dated 8 January 2002 in CA-G.R. SP No. 59182 is ANNULLED and SET ASIDE. A survey of the questioned lot with TCT No. 289216 (formerly TCT No. 263624) by a duly licensed geodetic engineer and the PARTITION of the aforesaid lot are ORDERED. Let the records of this case be REMANDED to MeTC-Br. 49, Caloocan City to effect the aforementioned survey and partition, as well as segregate the 1/6 portion appertaining to petitioner Lilia Sanchez. The Deed of Absolute Sale by the other co-owners to Virginia Teria shall be RESPECTED insofar as the other undivided 5/6 portion of the property is concerned. SO ORDERED.

2. ID.; ID.; ID.; EXISTING CO-OWNERSHIP NOT TERMINATED EVEN THOUGH THE LATTER SECURED TITLE OVER THE PARCEL IN HIS NAME. Neither does the fact that the petitioner had succeeded in securing title over the parcel in his name terminate the existing co-ownership. While his half-brothers and sisters are, as we said, liable to him for reimbursement as and for their shares in redemption expenses, he cannot claim exclusive right to the property owned in common. Registration of property is not a means of acquiring ownership. It operates as a mere notice of existing title, that is, if there is one. The petitioner must then be said to be a trustee of the property on behalf of the private respondents. The Civil Code states: ART. 1456. If 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. 3. ID.; ID.; ID.; RELATION OF CO-OWNERSHIP; TERMINATION THEREOF BY PRESCRIPTION MUST BE PRECEDED BY REPUDIATION. This Court is not unaware of the wellestablished principle that prescription bars any demand on property (owned in common) held by another (co-owner) following the required number of years. In that event, the party in possession acquires title to the property and the state of coownership is ended. In the case at bar, the property was registered in 1955 by the petitioner, solely in his name, while the claim of the private respondents was presented in 1974. Has prescription then, set in? We hold in the negative. Prescription, as a mode of terminating a relation of co-ownership, must have been preceded by repudiation (of the co-ownership). 4. ID.; ID.; ID.; ID.; ID.; REQUISITES ON THE ACT OF REPUDIATION. The act of repudiation, in turn, is subject to certain conditions: (1) a co-owner repudiates the coownership; (2) such an act of repudiation is clearly made known to the other co-owners; (3) the evidence thereon is clear and conclusive; and (4) he has been in possession through open, continuous, exclusive, and notorious possession of the property for the period required by law. The instant case shows that the petitioner had not complied with these requisites. We are not convinced that he had repudiated the co-ownership; on the contrary, he had deliberately kept the private respondents in the dark by feigning sole heirship over the estate under dispute. He cannot therefore be said to have "made known" his efforts to deny the co-ownership. 5. ID.; LAND REGISTRATION; REGISTRATION UNDER THE TORRENS SYSTEM, NOT A MEANS TO SHIELD FRAUD. It is true that registration under the Torrens system is constructive notice of title, but it has likewise been our holding that the Torrens title does not furnish a shield for fraud. It is therefore no argument to say that the act of registration is equivalent to notice of repudiation, assuming there was one, notwithstanding the long-standing rule that registration operates as a universal notice of title.

SECOND DIVISION [G.R. No. L-44546. January 29, 1988.] RUSTICO ADILLE, petitioner, vs. THE HONORABLE COURT OF APPEALS, EMETERIA ASEJO, TEODORICA ASEJO, DOMINGO ASEJO, JOSEFA ASEJO, and SANTIAGO ASEJO, respondents.

SYLLABUS 1. CIVIL LAW; SALES; RIGHT OF REPURCHASE EXERCISED BY A CO-OWNER; PERTAINS TO HIS SHARE ALONE; OWNERSHIP OVER THE ENTIRE PROPERTY NOT VESTED IN FAVOR OF REDEEMING CO-OWNER. The result is that the property remains to be in a condition of co-ownership. While a vendee a retro, under Article 1613 of the Code, "may not be compelled to consent to a partial redemption," the redemption by one co-heir or coowner of the property in its totality does not vest in him ownership over it. Failure on the part of all the co-owners to redeem it entitles the vendee a retro to retain the property and consolidate title thereto in his name. But the provision does not give to the redeeming co-owner the right to the entire property. It does not provide for a mode of terminating a co-ownership.

6. ID.; ID.; CONSTRUCTIVE TRUST: ACTION TO ENFORCE IT RECKONED FROM ACTUAL DISCOVERY OF THE ACT OF DEFRAUDATION. For the same reason, we cannot dismiss the private respondents' claims commenced in 1974 over the estate registered in 1955. While actions to enforce a constructive trust prescribes in ten years, reckoned from the date of the registration of the property, we, as we said, are not prepared to count the period from such a date in this case. We note the petitioner's sub rosa efforts to get hold of the property exclusively for himself beginning with his fraudulent misrepresentation in his unilateral affidavit of extrajudicial settlement that he is "the only heir and child of his mother Feliza with the consequence that he was able to secure title in his name also." Accordingly, we hold that the right of the private respondents commenced from the time they actually discovered the petitioner's act of defraudation. According to the respondent Court of Appeals, they came to know [of it] apparently only during the progress of the litigation." Hence, prescription is not a bar. 7. REMEDIAL LAW; CIVIL PROCEDURE; PRESCRIPTION AS AN AFFIRMATIVE DEFENSE; DEEMED WAIVED IF NOT PLEADED IN A MOTION TO DISMISS OR IN THE ANSWER. Moreover, and as a rule, prescription is an affirmative defense that must be pleaded either in a motion to dismiss or in the answer otherwise it is deemed waived, and here, the petitioner never raised that defense. There are recognized exceptions to this rule, but the petitioner has not shown why they apply.

The antecedent facts are quoted from the decision 2 appealed from: xxx xxx xxx . . . [Th]e land in question Lot 14694 of Cadastral Survey of Albay located in Legaspi City with an area of some 11,325 sq. m. originally belonged to one Felisa Alzul as her own private property; she married twice in her lifetime; the first, with one Bernabe Adille, with whom she had as an only child, herein defendant Rustico Adille; in her second marriage with one Procopio Asejo, her children were herein plaintiffs, now, sometime in 1939, said Felisa sold the property in pacto de retro to certain 3rd persons, period of repurchase being 3 years, but she died in 1942 without being able to redeem and after her death, but during the period of redemption, herein defendant repurchased, by himself alone, and after that, he executed a deed of extra-judicial partition representing himself to be the only heir and child of his mother Felisa with the consequence that he was able to secure title in his name alone also, so that OCT. No. 21137 in the name of his mother was transferred to his name, that was in 1955; that was why after some efforts of compromise had failed, his halfbrothers and sisters, herein plaintiffs, filed present case for partition with accounting on the position that he was only a trustee on an implied trust when he redeemed, and this is the evidence, but as it also turned out that one of plaintiffs, Emeteria Asejo was occupying a portion, defendant counterclaimed for her to vacate that, Well then, after hearing the evidence, trial Judge sustained defendant in his position that he was and became absolute owner, he was not a trustee, and therefore, dismissed case and also condemned plaintiff occupant, Emeteria to vacate; it is because of this that plaintiffs have come here and contend that trial court erred in: "I. . . . declaring the defendant absolute owner of the property; II. . . . not ordering the partition of the property; and

DECISION

SARMIENTO, J p: In issue herein are property and property rights, a familiar subject of controversy and a wellspring of enormous conflict that has led not only to protracted legal entanglements but to even more bitter consequences, like strained relationships and even the forfeiture of lives. It is a question that likewise reflects a tragic commentary on prevailing social and cultural values and institutions, where, as one observer notes, wealth and its accumulation are the basis of self-fulfillment and where property is held as sacred as life itself. "It is in the defense of his property," says this modern thinker, that one "will mobilize his deepest protective devices, and anybody that threatens his possessions will arouse his most passionate enmity." 1 The task of this Court, however, is not to judge the wisdom of values; the burden of reconstructing the social order is shouldered by the political leadership and the people themselves. The parties have come to this Court for relief and accordingly, our responsibility is to give them that relief pursuant to the decree of law.

III. . . . ordering one of the plaintiffs who is in possession of the portion of the property to vacate the land, p. 1 Appellant's brief. which can be reduced to simple question of whether or not on the basis of evidence and law, judgment appealed from should be maintained. 3 xxx xxx xxx The respondent Court of Appeals reversed the trial court, 4 and ruled for the plaintiffsappellants, the private respondents herein. The petitioner now appeals, by way of certiorari, from the Appellate Court's decision. We required the private respondents to file a comment and thereafter, having given due course to the petition, directed the parties to file their briefs. Only the petitioner, however, filed a brief, and the private respondents having failed to file one, we declared the case submitted for decision. The petition raises a purely legal issue: May a co-owner acquire exclusive ownership over the property held in common? cdphil Essentially, it is the petitioner's contention that the property subject of dispute devolved upon him upon the failure of his co-heirs to join him in its redemption within the period required by law. He relies on the provisions of Article 1515 of the old Civil Code, Article 1613 of the present Code, giving the vendee a retro the right to demand redemption of the entire property. There is no merit in this petition. The right of repurchase may be exercised by a co-owner with respect to his share alone. 5 While the records show that the petitioner redeemed the property in its entirety, shouldering the expenses therefor, that did not make him the owner of all of it. In other words, it did not put to end the existing state of co-ownership. Necessary expenses may be incurred by one co-owner, subject to his right to collect reimbursement from the remaining co-owners. 6 There is no doubt that redemption of property entails a necessary expense. Under the Civil Code: ART. 488. Each co-owner shall have a right to compel the other coowners to contribute to the expenses of preservation of the thing or right owned in common and to the taxes. Any one of the latter may

exempt himself from this obligation by renouncing so much of his undivided interest as may be equivalent to his share of the expenses and taxes. No such waiver shall be made if it is prejudicial to the coownership. The result is that the property remains to be in a condition of co-ownership. While a vendee a retro, under Article 1613 of the Code, "may not be compelled to consent to a partial redemption," the redemption by one co-heir or co-owner of the property in its totality does not vest in him ownership over it. Failure on the part of all the co-owners to redeem it entitles the vendee a retro to retain the property and consolidate title thereto in his name. 7 But the provision does not give to the redeeming co-owner the right to the entire property. It does not provide for a mode of terminating a coownership. Neither does the fact that the petitioner had succeeded in securing title over the parcel in his name terminate the existing co-ownership. While his half-brothers and sisters are, as we said, liable to him for reimbursement as and for their shares in redemption expenses, he cannot claim exclusive right to the property owned in common. Registration of property is not a means of acquiring ownership. It operates as a mere notice of existing title, that is, if there is one. The petitioner must then be said to be a trustee of the property on behalf of the private respondents. The Civil Code states: ART. 1456. If 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. We agree with the respondent Court of Appeals that fraud attended the registration of the property. The petitioner's pretension that he was the sole heir to the land in the affidavit of extrajudicial settlement he executed preliminary to the registration thereof betrays a clear effort on his part to defraud his brothers and sisters and to exercise sole dominion over the property. The aforequoted provision therefore applies. It is the view of the respondent Court that the petitioner, in taking over the property, did so either on behalf of his co-heirs, in which event, he had constituted himself a negotiorum gestor under Article 2144 of the Civil Code, or for his exclusive benefit, in which case, he is guilty of fraud, and must act as trustee, the private respondents being the beneficiaries, under the Article 1456. The evidence, of course, points to the second alternative the petitioner having asserted claims of exclusive ownership over the property and having acted in fraud of his co-heirs. He cannot therefore be said to have

assumed the mere management of the property abandoned by his co-heirs, the situation Article 2144 of the Code contemplates. In any case, as the respondent Court itself affirms, the result would be the same whether it is one or the other. The petitioner would remain liable to the private respondents, his co-heirs. This Court is not unaware of the well-established principle that prescription bars any demand on property (owned in common) held by another (co-owner) following the required number of years. In that event, the party in possession acquires title to the property and the state of co-ownership is ended. 8 In the case at bar, the property was registered in 1955 by the petitioner, solely in his name, while the claim of the private respondents was presented in 1974. Has prescription then, set in? We hold in the negative. Prescription, as a mode of terminating a relation of coownership, must have been preceded by repudiation (of the co-ownership). The act of repudiation, in turn, is subject to certain conditions: (1) a co-owner repudiates the coownership; (2) such an act of repudiation is clearly made known to the other co-owners; (3) the evidence thereon is clear and conclusive; and (4) he has been in possession through open, continuous, exclusive, and notorious possession of the property for the period required by law. 9 The instant case shows that the petitioner had not complied with these requisites. We are not convinced that he had repudiated the co-ownership; on the contrary, he had deliberately kept the private respondents in the dark by feigning sole heirship over the estate under dispute. He cannot therefore be said to have "made known" his efforts to deny the co-ownership. Moreover, one of the private respondents, Emeteria Asejo, is occupying a portion of the land up to the present, yet, the petitioner has not taken pains to eject her therefrom. As a matter of fact, he sought to recover possession of that portion Emeteria is occupying only as a counterclaim, and only after the private respondents had first sought judicial relief. prcd It is true that registration under the Torrens system is constructive notice of title, 10 but it has likewise been our holding that the Torrens title does not furnish a shield for fraud. 11 It is therefore no argument to say that the act of registration is equivalent to notice of repudiation, assuming there was one, notwithstanding the long-standing rule that registration operates as a universal notice of title. For the same reason, we cannot dismiss the private respondents' claims commenced in 1974 over the estate registered in 1955. While actions to enforce a constructive trust prescribes in ten years, 12 reckoned from the date of the registration of the property, 13 we, as we said, are not prepared to count the period from such a date in this case. We note the petitioner's sub rosa efforts to get hold of the property exclusively for himself beginning with his fraudulent misrepresentation in his unilateral affidavit of

extrajudicial settlement that he is "the only heir and child of his mother Feliza with the consequence that he was able to secure title in his name also." 14 Accordingly, we hold that the right of the private respondents commenced from the time they actually discovered the petitioner's act of defraudation. 15 According to the respondent Court of Appeals, they came to know [of it] apparently only during the progress of the litigation." 16 Hence, prescription is not a bar. Moreover, and as a rule, prescription is an affirmative defense that must be pleaded either in a motion to dismiss or in the answer otherwise it is deemed waived, 17 and here, the petitioner never raised that defense. 18 There are recognized exceptions to this rule, but the petitioner has not shown why they apply. LLpr WHEREFORE, there being no reversible error committed by the respondent Court of Appeals, the petition is DENIED. The Decision sought to be reviewed is hereby AFFIRMED in toto. No pronouncement as to costs. SO ORDERED.

THIRD DIVISION [G.R. No. 79899. April 24, 1989.] D. ANNIE TAN, petitioner, vs. COURT OF APPEALS, CHINA BANKING CORPORATION, GEORGE LAUREL TAN, TEODORA TAN ONG, ROSA TAN, ROSITA TAN, and MAURO UMALI TAN, respondents.

Tabaquero, Albano & Evangelista for petitioner. Del Rosario, Lim, Telan, De Vera & Vigilia for respondent China Banking Corporation. Estela B. Perlas for respondents Tan.

SYLLABUS 1. CIVIL LAW; SPECIAL CONTRACTS; REAL ESTATE MORTGAGE; DEATH OF MORTGAGOR; CO-OWNERSHIP EXISTED AMONG THE HEIRS ON THE PROPERTY MORTGAGED DURING THE PERIOD OF REDEMPTION. The first question which arises is the correctness of the

assumption that there was a co-ownership among the children of Tan Tiong Tick and Tan Ong Hun when the petitioner purchased the property. Since the lot and its improvement were mortgaged by the deceased parents, there can be no question that a co-ownership existed among the heirs during the period given by law to redeem the foreclosed property. Redemption by one during this period would have inured to the benefit of all. (Adille v. Court of Appeals, G.R. No. 44546, 157 SCRA 455 [1988]; and De Guzman v. Court of Appeals, G.R. No. 47378, 148 SCRA 75 [1987]). 2. ID.; ID.; ID.; ID.; EXPIRATION OF REDEMPTION PERIOD; CO-OWNERSHIP AMONG THE HEIRS EXTINGUISHED. The records show that when the petitioner purchased the disputed property on August 30, 1974, any co-ownership among the brothers and sisters no longer existed. The period to redeem had expired more than one year earlier, on July 6, 1973. The respondent China Bank consolidated its ownership and a new title was issued in the bank's name. When the heirs allowed the one year redemption period to expire without redeeming their parents' former property and permitted the consolidation of ownership and the issuance of a new title, the co-ownership was extinguished. The challenged ruling of the respondent court is, therefore, based on erroneous premises. 3. ID.; ID.; PRESIDENTIAL DECREE NO. 1529 (PROPERTY REGISTRATION DECREE); NONREDEMPTION OF MORTGAGED PROPERTY; PURCHASER AT THE FORECLOSURE SALE ENTITLED TO A NEW CERTIFICATE OF TITLE. Under Section 63-B of Presidential Decree No. 1529, the Property Registration Decree, in case of non-redemption, the purchaser at the foreclosure sale, meaning the respondent Bank in this case, is entitled to a new certificate of title in its name after filing the necessary papers with the Register of Deeds. (Spouses Teofisto and Eulalia Verceles v. Court of First Instance of Rizal, et al., G.R. No. 62219, February 28, 1989). It becomes a ministerial duty to place the buyer in possession of the property he now owns. (Banco Filipino v. Intermediate Appellate Court, G.R. No. 68878, 142 SCRA 44 [1986]). Ownership, therefore, passed to China Bank and there was no more co-ownership among the heirs. 4. ID.; ID.; REAL ESTATE MORTGAGE; EFFECTS OF FORECLOSURE OF THE MORTGAGED PROPERTY OF DECEASED MORTGAGOR; CASE AT BAR. May the heirs be considered as debtors in common, substituting for their parents in liquidating the latter's obligations? The answer is again, No. Upon the foreclosure of the mortgaged property and its purchase by China Bank as the highest bidder, the proceeds of the auction sale were applied to the various debts of the Tan spouses. The parents' debts were paid. The obligation having been extinguished, there was no more common debt and no legal subrogation arising when one pays the debts properly accruing to several others. 5. ID.; ID.; ID.; LEGAL REDEMPTION; INTENDED TO MINIMIZE CO-OWNERSHIP. Mr. Dee could not impose a new co-ownership upon the petitioner, her brothers and sisters.

Co-ownership is discouraged by law. As held in the case of Basa v. Aguilar (G.R. No. L30994, 117 SCRA 128, 130-131 [1982]): "Legal redemption is in the nature of a privilege created by law partly for reasons of public policy and partly for the benefit and convenience of the redemptioner, to afford him a way out of what might be a disagreeable or inconvenient association into which he has thrust. (10 Manresa, 4th Ed., 317.) It is intended to minimize co-ownership. The law grant a co-owner the exercise of the said right of redemption when the shares of the other owners are sold to 'a third person.' A third person, within the meaning of this Article, is anyone who is not a coowner. (Sentencia of February 7, 1944 as cited in Tolentino, Comments on the Civil Code, Vol. V, p. 160.)" (Emphasis supplied)

DECISION

GUTIERREZ, JR., J p: Tan Tiong Tick, married to Tan Ong Hun, was the registered owner of a 178 square meter parcel of land and its improvements located at Lot No. 5, Block No. 2021 of the Cadastral Survey of Manila, Carvajal Street, Binondo, Manila. Mr. and Mrs. Tan had six children - respondents George Laurel Tan, Teodora Tan Ong, Rosa Tan, Rosita Tan, Mauro Umali Tan, and the petitioner, D. Annie Tan. On February 6, 1963, in order to secure payment of various obligations with respondent China Banking Corporation or China Bank for short, Mr. and Mrs. Tan Tiong Tick mortgaged the disputed property to the bank. Tan Tiong Tick died on December 22, 1969 without having paid his obligations. On June 27, 1972, China Bank foreclosed the mortgage and purchased the property at public auction as the highest bidder for the sum of P186,100.00. On August 31, 1972, the widow and children of Tan Tiong Tick filed a complaint against China Bank with the Court of First Instance of Manila praying for the nullity of the real estate mortgage executed by the spouses Tan and the foreclosure sale conducted by the Sheriff. They also asked that the redemption period be suspended. The one year period for redemption expired on July 6, 1973 without the Tan heirs having exercised the right to redeem the property. The widow Tan Ong Hun having died, only the children were left to redeem the lot and building. China Bank consolidated its

ownership over the land and improvements and a new title, Transfer Certificate Title No. 112924 was issued in the name of the bank on August 16, 1973. About two weeks earlier, however, the heirs of Tan and China Bank agreed to amicably settle the action for nullity of mortgage before the Court of First Instance of Manila. The parties filed a joint motion to dismiss. cdphil The verbal agreement regarding the disposition of the property was confirmed in a letter of China Bank signed by four of the children and one daughter-in-law on August 3, 1973. The heirs were given the right to repurchase the property for P180,000.00 provided it was done on or before August 31, 1974. The agreement reads in part.: xxx xxx xxx "It is understood, that should you fail to pay us in full the aforesaid sum of P180,000.00 on or before August 31, 1974, your right to repurchase the property shall terminate and we shall be free to dispose of the property to any other party." (p. 81, Folder of Exhibits; Exhibit 2, CBC) There are allegations that some of the heirs tried to buy the property in the ensuing one year period but for one reason or another, were unable to do so. Finally, on August 30, 1974, or one day before the end of the period to buy back, petitioner D. Annie Tan went to the office of Mr. Dee K. Chiong of China Bank and tendered her China Bank Manager's Check for P180,000.00 as payment. Upon the insistence of the bank official, the deed of sale returning the property to the heirs was executed in favor, not of D. Annie Tan who alone paid for the property but of all the six heirs of Tan Tiong Tick who would, therefore, share and share alike. This led to the filing of the action by D. Annie Tan against her brothers and sisters and the China Banking Corporation, now respondents in this petition. The petitioner prayed the trial court to order the respondents (1) to reconvey the disputed property to her and (2) to pay actual damages in the amount of P300,000.00, moral damages in the amount of P100,000.00, exemplary damages in the amount of P50,000.00, and attorney's fees in the amount of P10,000.00. On September 1, 1980, the Court of First Instance of Manila rendered a decision, the dispositive portion of which reads: "ACCORDINGLY, judgment is hereby rendered as follows:

"(1) Dismissing the complaint as well as defendants' counterclaim; "(2) Ordering each of the defendants, namely George Laurel Tan, Teodora Tan Ong, Rosa Tan and Rosita Tan to reimburse the plaintiff the sum of P30,000.00 plus 12% interest from August 20, 1974 until the whole amount is fully paid; "(3) Ordering the defendant Mauro Umali Tan who had been ordered in default to execute the deed of sale of his rights and interests over the property covered in Transfer Certificate of Title No. 64306 in favor of the plaintiff in accordance with his instrument of waiver dated June 25, 1974, and "(4) Without pronouncement as to costs." (Annex B, Rollo, pp. 4344) On October 17, 1986, the Court of Appeals affirmed the decision of the trial court. On September 7, 1987, a motion for reconsideration was denied. Hence this petition. The petitioner gives the following grounds why her petition should be given due course: 1. RESPONDENT COURT OF APPEALS GRAVELY ERRED IN AFFIRMING THE DECISION OF THE TRIAL COURT ORDERING REIMBURSEMENT TO THE PETITIONER INSPITE OF THE FACT THAT THE LEGAL BASIS FOR THE REIMBURSEMENT, WHICH WAS NOT CLEARLY EXPLAINED IN THE DECISION, MAY HAVE BEEN THE ALLEGED EXISTENCE OF (1) A CO-OWNERSHIP AMONG THE HEIRS, AND (2) CREDITOR-DEBTOR RELATIONSHIP BETWEEN THE HEIRS AND THE BANK, WHICH HAVE NOT BEEN FULLY ESTABLISHED BY EVIDENCE. 2. ASSUMING, WITHOUT ADMITTING, THE EXISTENCE AMONG THE HEIRS OF A CO-OWNERSHIP AND/OR A CREDITOR/DEBTOR RELATIONSHIP BETWEEN THE RESPONDENT BANK AND THE HEIRS, RESPONDENT COURT GRAVELY ERRED IN NOT HOLDING THAT THE CO-HEIRS OF PETITIONER, THE PRIVATE RESPONDENTS HEREIN, HAVE IMPLIEDLY WAIVED THEIR RIGHT TO BUY BACK THE PROPERTY BY THEIR FAILURE TO RAISE THE MONEY FOR THEIR RESPECTIVE SHARES UP TO THE LAST DAY GIVEN THEM BY THE RESPONDENT BANK ON AUGUST 31, 1974, THUS WHEN PETITIONER BOUGHT THE PROPERTY BY HER EXCLUSIVE FUNDS, IT BENEFITED HER ALONE AND NOT HER CO-HEIRS. LLpr

3. RESPONDENT COURT OF APPEALS, GRAVELY ERRED IN NOT HOLDING THAT THE LETTER-AGREEMENT DATED AUGUST 3, 1973, FOR WHICH THE RIGHTS OF THE PETITIONER AND HER CO-HEIRS TO BUY BACK THE FORECLOSED PROPERTY AROSE, IS ACTUALLY NOT A RIGHT TO REPURCHASE BUT IS AN OPTION TO BUY BACK THE PROPERTY WHICH MAY BE EXERCISED BY THE HEIRS SINGLY OR COLLECTIVELY. (Rollo, pp. 21-22) The decision of the trial court, affirmed by the Court of Appeals, is based on the principle that the heirs of Mr. and Mrs. Tan Tiong Tick being co-owners of the foreclosed property, a repurchase or reconveyance effected by only one of those heirs redounds to the co-ownership. This explains why the courts below ordered four of the heirs George Laurel Tan, Teodora Tan Ong, Rosa Tan and Rosita Tan to reimburse D. Annie Tan the sum of P30,000.00 each plus 12% interests while the share of the fifth heir who was in default and who had waived his interest would go to the petitioner. The petitioner contends that there was no co-ownership and no creditor/debtor relationship between her and the other children. The petitioner states: "This controversy addresses itself to the question of whether or not the co-ownership among the heirs over a parcel of land formerly belonging to their parents had been dissolved by the foreclosure and consolidation of title by a bank after the redemption period of one (1) year had expired, such that a unilateral obligation given by the bank to the heirs to buy back the foreclosed property out of liberality is actually an option to buy given to the heirs as group of persons singly or collectively, and not strictly a right of repurchase to be exercised by the heirs as co-owners. If it is admitted that the co-ownership of the heirs over the foreclosed property of their parents had been dissolved by the consolidation of the title in the mortgagee's name, which in this case is respondent Bank and that there exists no creditor-debtor relationship between respondent Bank and the heirs, then the bank may not impose an obligation to the heirs that they should purchase back the property only as former co-owners or as solidary debtors, but as groups of persons, singly or collectively. The bank would then be imposing an onerous condition upon the heirs of going back to the dissolved coownership which the law frowns upon. To settle this case once and

for all, herein petitioner anchors her claim on the theory that when the respondent Bank foreclosed the property and consolidated its title on August 16, 1973 and T.C.T. No. 112924 was issued in its name, the co-ownership of the heirs of the deceased parents of petitioner and private respondents over the property in question have been dissolved. In this wise, the decision of the respondent court premised on the existence of a co-ownership or in a creditordebtor relationship, and ordering the reimbursement to petitioner of the money for the purchase of the property in question which allegedly redounded to the benefits of her co-heirs as co-owners or solidary debtors has no leg to stand on. It is this erroneous decision of respondent court based on a misapprehension of facts and contrary to settled jurisprudence that petitioner comes to this Honorable Court, for relief. (Sese v. Intermediate Appellate Court, G.R. No. 66186, July 31, 1987; Moran, Jr. v. Court of Appeals, 133 SCRA 88; Manero v. Court of Appeals, 102 SCRA 817; Carolina Industries v. CMS Brokerage, 97 SCRA 734; Sacay v. Sandiganbayan, 142 SCRA 593)." (Rollo, pp. 7-9) The first question which arises is the correctness of the assumption that there was a coownership among the children of Tan Tiong Tick and Tan Ong Hun when the petitioner purchased the property. Since the lot and its improvement were mortgaged by the deceased parents, there can be no question that a co-ownership existed among the heirs during the period given by law to redeem the foreclosed property. Redemption by one during this period would have inured to the benefit of all. (Adille v. Court of Appeals, G.R. No. 44546, 157 SCRA 455 [1988]; and De Guzman v. Court of Appeals, G.R. No. 47378, 148 SCRA 75 [1987]). Cdpr The records show, however, that when the petitioner purchased the disputed property on August 30, 1974, any co-ownership among the brothers and sisters no longer existed. The period to redeem had expired more than one year earlier, on July 6, 1973. The respondent China Bank consolidated its ownership and a new title was issued in the bank's name. When the heirs allowed the one year redemption period to expire without redeeming their parents' former property and permitted the consolidation of ownership and the issuance of a new title, the co-ownership was extinguished. The challenged ruling of the respondent court is, therefore, based on erroneous premises. Under Section 63-B of Presidential Decree No. 1529, the Property Registration Decree, in case of non-redemption, the purchaser at the foreclosure sale, meaning the respondent Bank in this case, is entitled to a new certificate of title in its name after

filing the necessary papers with the Register of Deeds. (Spouses Teofisto and Eulalia Verceles v. Court of First Instance of Rizal, et al., G.R. No. 62219, February 28, 1989). It becomes a ministerial duty to place the buyer in possession of the property he now owns. (Banco Filipino v. Intermediate Appellate Court, G.R. No. 68878, 142 SCRA 44 [1986]). Ownership, therefore, passed to China Bank and there was no more coownership among the heirs. The non-existence of a common inheritance of the Tan children at the time the disputed property was purchased from China Bank is moreover supported by the evidence showing that there was no more inheritance to divide. It had already been divided. Tan Tiong Tick left other properties in addition to the property disputed in this petition. The eldest son, George Laurel Tan, inherited practically all the properties consisting of several hectares of real estate in Novaliches, Metro Manila; a furnished house in Greenhills, Mandaluyong; and a cigar factory. (t.s.n., November 18, 1976, p. 24) The petitioner also claims that stock certificates went to another sister, Teodora Tan Ong because she "forced" the other heirs to sign a deed of sale in her favor. May the heirs be considered as debtors in common, substituting for their parents in liquidating the latter's obligations? The answer is again, No. Upon the foreclosure of the mortgaged property and its purchase by China Bank as the highest bidder, the proceeds of the auction sale were applied to the various debts of the Tan spouses. The parents' debts were paid. The obligation having been extinguished, there was no more common debt and no legal subrogation arising when one pays the debts properly accruing to several others. Respondent China Bank contends that the letter agreement dated August 3, 1973 called for the reconveyance of the land and improvements to all the heirs "in equal undivided shares." There is no such stipulation in the letter. There is reference to a verbal agreement to reconvey to the "heirs of your late father" but no requirement that everybody must share in the purchase or the offer would be withdrawn. What is clear is that the bank's general manager, Mr. Dee K. Chiong tried to impose the above requirement when the one year period to buy back was about to expire. Mr. Dee rejected the offer of D. Annie Tan to buy the property for herself alone. He insisted that the money brought by the petitioner would be considered a joint fund of all the heirs and ordered the same annotated on the back of the check given as payment for the property.

This attitude of Mr. Dee K. Chiong is in sharp contrast to the bank's official stand embodied in a letter to the Central Bank. Asked to comment on a letter-complaint filed by D. Annie Tan with Malacaang and forwarded to the Central Bank, the respondent bank through its Legal Officer wrote the Director, Department of Commercial and Savings Bank, Central Bank an explanation, part of which states: "To our mind, the dispute is not between the Bank and the heirs or any one of them, but among the heirs themselves, for as far as the Bank is concerned, it makes no difference whether the property is reconveyed to all the heirs or to any one of them alone as they may agree. As a matter of fact the complainant has already filed a Petition under the Cadastral Case now pending in the CFI, Manila, involving the property and all the heirs. (Copy of the Petition is hereto attached as Annex "10"). LibLex "At any rate, it is our honest conviction that the charges filed by the complainant and the interpretation of Articles 1302 and 1303 of the New Civil Code properly belong to the Courts where the complainant can always have her right, if any, vindicated, and if only to resolve the issue, we shall welcome any court action to clear the matter." (Folder of Exhibits, pp. 97-98) The petitioner questions the unusual interest shown by China Bank in the case when its stand should be one of neutrality. She claims that there is an orchestrated alliance between the bank and the other private respondents as shown by the fact that the bank seems to be more eager and vigorous than the other heirs to win the case. (Rollo, p. 310). As earlier stated, there is nothing in the August 3, 1973 letter-agreement which called for either a purchase by all the heirs or no purchase at all. But could not Mr. Dee K. Chiong validly impose such a requirement at the time the tender of money to buy the property was made? Again, the answer is in the negative. We agree with the petitioner that her agreeing to sign an annotation at the back of the check was a case of vitiated consent. She states that her conformity was null and void because it was made under duress. The records show that up to the last hour the

petitioner was pleading with Mr. Dee K. Chiong to buy the property for herself alone as the money she had raised was not in any way owned by the other heirs. Since the period was expiring, the petitioner had no choice. It was a case of either agreeing to the bank executive's requirement or losing the family property forever to strangers.

"'a) What will happen if one of the heirs of the late Tan Tiong Tick refuses or fails to exercise his right to purchase for whatever reason? Cannot any of the other heirs, but all, raise sufficient finds for the full amount of the purchase price because the other heirs could not let him or her borrow money to cover his or her share? Would such refusal then prejudice the other heirs? "'b) Cannot two or more heirs, but not all, who have sufficient funds exercise the right of purchase? "'c) Would all the heirs then who signed the letteragreement as in the case at bar lose their right to purchase the property because of the refusal of one heir? "'d) If only one of the heirs has sufficient funds to purchase the property and the others do not have, and this particular heir does not want to lend her or his money to the other heirs who have none, can the offer of the other heir to exercise the option to buy in her or his own name alone he legally refused? "'e) Finally, can the buying back of the property by one heir alone be disallowed considering that she is the one who has enough or sufficient funds and that her action will prevent the property from going to third persons, like respondent Bank, for failure to pay the purchase price on the last day of the period given by respondent Bank?' "It is petitioner's submission that to follow the arguments of respondent Bank that the letter-agreement can only be exercised collectively and not singly would render the said agreement a useless piece of paper, and gravely prejudicial to the property itself. "What is more, even the respondent bank's legal officer, Atty. Arsenio Sy Santos, when asked to comment on the case of the petitioner, admitted that indeed the letter-agreement of August 3, 1973 is actually an option to buy. Said legal officer gave the following observations and comments, to wit: "'xxx xxx xxx

Mr. Dee could not impose a new co-ownership upon the petitioner, her brothers and sisters. Co-ownership is discouraged by law. As held in the case of Basa v. Aguilar (G.R. No. L-30994, 117 SCRA 128, 130-131 [1982]): "Legal redemption is in the nature of a privilege created by law partly for reasons of public policy and partly for the benefit and convenience of the redemptioner, to afford him a way out of what might be a disagreeable or inconvenient association into which he has thrust. (10 Manresa, 4th Ed., 317.) It is intended to minimize coownership. The law grant a co-owner the exercise of the said right of redemption when the shares of the other owners are sold to 'a third person.' A third person, within the meaning of this Article, is anyone who is not a co-owner. (Sentencia of February 7, 1944 as cited in Tolentino, Comments on the Civil Code, Vol. V, p. 160.)" (Italics supplied) The records show that the annotation at the back of the P180,000.00 manager's check that the funds were contributed by all the heirs was made by a China Bank representative and that D. Annie Tan was told by Dee K. Chiong that if she would not sign it, he would not accept the manager's check and she would lose her right to buy the lot within the period offered by the bank. The petitioner, at first, refused but being placed between the difficulty of agreeing to the condition or losing the property, she decided to agree. (t.s.n., September 27, 1976, pp. 24-25; t.s.n., November 18, 1976, p. 36) The petitioner was also aware that a certain Mr. Ang who operated a travel agency in the next door building was eager to buy the property at double the price stated in the letter-agreement executed more than a year earlier. (Court of Appeals Rollo, Brief for Plaintiff-Appellant, p. 77) The petitioner further argues: "The insistence by respondent Bank that the said letter-agreement is a right to re-purchase given to all the heirs of the late Tan Tiong Tick to be exercised only collectively cannot legally stand considering the following circumstances:

Observations and comments It may be interesting to note that the provisions of Articles 1302 and 1303 which reads as follows: Art. 1302. It is presumed that there is legal subrogation: (1) When a creditor pays another creditor who is preferred, even without the debtor's knowledge; (2) When a third person, not interested in the obligation, pays with the express or tacit approval of the debtor. (3) When even without the knowledge of the debtor, a person interested in the fulfillment of the obligation pays, without prejudice to the effects of confusion as to the latter's share. Art. 1303. Subrogation transfers to the person subrogated the credit with all the rights thereto appertaining, either against the debtor or against third person, be they guarantors or possessors of mortgages, subject to stipulated in a conventional subrogations (sic).' refer to cases where the creditor-debtor relationship exists among the parties.) (Rollo, pp. 243-246) xxx xxx xxx There was no creditor-debtor relationship existing among the heirs and Mr. Dee had no legal authority to create one. China Bank contends that when it told the petitioner that the property could not be reconveyed to her alone, she was likewise informed that a similar offer from some of the other co-heirs had also been politely turned down. (Exhibit 7, China Bank, Folder of Exhibits, p. 87) The petitioner disputes this claim. She states that there was no such offer by her coheirs because she was the only one willing to buy back the lot and the only one with the

means to do so at that time. It was only on September 12, 1974 that the individual respondents offered to repurchase. By that time, D. Annie Tan had already paid for the lot and was already insisting on a conveyance of the property in her name alone. The petitioner states: "There is, therefore, no doubt that the money used in buying back the property belongs exclusively to the petitioner. Private respondents' inaction in not contributing the necessary money up to the last day of the buy back period is fatal to their cause. To paraphrase one case decided by this Honorable Court, courts cannot look with favor at parties who, by their silence, delay and inaction, knowingly induce another to spend time, effort and expense in protecting their interests over the property by paying the buy back money only to spring from ambush and claim title or interest over the property when the land and building value have become higher. (See Lola v. Court of Appeals, G.R. No. 46575, November 13, 1986). Moreover, the laws aid the vigilant, not those who slumber on their rights. (Miraflor v. Court of Appeals, G.R. Nos. 40151-52, April 8, 1986). cdrep "Definitely, the effects of a waiver militates against the private respondents. Having forfeited, abandoned and/or waived their rights, private respondents are now estopped from taking an inconsistent position. They cannot now assert that they are still coowners of the property with the petitioner. (Sec. 65, Rule 123, Rules of Court; Hernaez v. Hernaez, 32 Phil. 214) (See also Banco de Oro Savings & Mortgage Bank v. Equitable Banking Corporation, G.R. No. 74917, January 20, 1988, citing Saura Import and Export Co. v. Court of Appeals, 24 SCRA 974). All the elements of a valid waiver (1) the existence of a right; (2) the knowledge of the existence thereof; and (3) the intention to relinquish such right, either expressly or impliedly are present. (Director of Lands v. Abiertas, 44 O.G. 928) . . ." (Rollo, pp. 238-239) The claim of the respondents Tan in their memorandum that they gave their individual contributions to the petitioner to raise the P180,000.00 is not worthy of credence. At the time of the repurchase, the petitioner was already estranged from the respondents Tan and they would not have given her any money without corresponding receipts or given her money under any circumstance, for that matter. In fact, there is no reason why the petitioner should be the one to collect the money of the heirs and bring it to China Bank. She was neither a son nor the eldest. Neither did the others feel kindly

towards her. The petitioner had called for a conference on July 23, 1974 at 619 Carvajal Street, Binondo, Manila to discuss compliance with the letter-agreement considering the fast approaching deadline. Not one showed up. (Rollo, pp. 44-45) The money was raised by D. Annie Tan through her connections with Jardine Davies because of her construction business. The decision of the respondent court confirmed the factual findings of the trial court. It declared that the respondents Tan became debtors of petitioner Tan and ordered them to reimburse the P30,000.00 each which were advanced by the petitioner. There was no pooling of resources up to August 30, 1974 when at 4:00 in the afternoon, D. Annie Tan went to Mr. Dee K. Chiong with the China Bank manager's check for P180,000.00. The equities of this case also favor the grant of the petition. D. Annie Tan went to plenty of trouble in her effort to buy back the property formerly owned by her parents. There is nothing in the records to show that, beyond making some perfunctory allegations, the respondents Tan did anything to save the property from falling into the hands of other persons. The petitioner states that she has now spent substantial sums to pay for real estate taxes and to renovate, and improve the premises. According to her she has "spent her little fortunes to preserve the patrimony left by her parents. She alone deserves to be entitled to the property, in law and equity: (Rollo, p. 317) WHEREFORE, the petition is hereby GRANTED. The questioned decision of the Court of Appeals is REVERSED and SET ASIDE. The respondent China Banking Corporation is ordered to execute the deed of sale over the disputed property in favor of the petitioner alone. SO ORDERED.

Emiliano S. Samson for private respondents.

DECISION

PARAS, J p: This is an appeal from the order of the then Court of First Instance of Bulacan in Civil Case No. 6200-M ** for partition and delivery of possession of certain shares in the conjugal assets. The dispositive portion of the order which herein petitioners assail states: "Upon due research and study, the Court finds sustainable the position of the defendants that the settled prevailing rule at present as laid down in latest decisions of the Supreme Court is that the right or action to enforce an implied or constructive trust (which is the situation indicated in the case at bar) in one's favor prescribes in ten (10) years. The citation of authorities made by defendants appears to be correct. (Carontes vs. C.A., 76 SCRA 514; Dela Cerna vs. Dela Cerna, 72 SCRA 514). In other words, the rule of imprescriptibility of actions based on constructive trust invoked by plaintiffs has been reversed and abandoned. For the foregoing premises, this case has to be resolved for defendants-movants. Case is accordingly dismissed. No costs."

SECOND DIVISION [G.R. No. L-59974. March 9, 1987.] TEODORA, MARTA, JOSE, SIXTO, RICARDO, ROBERTO, PILAR, VIRGILIO, all surnamed MARIANO and AURORA EUGENIO, petitioners, vs. THE HON. JUDGE JESUS R. DE VEGA, PRESIDING JUDGE, COURT OF FIRST INSTANCE OF BULACAN, BRANCH II, PILAR, REGINA, FELISA and DOMINADOR all surnamed PANGANIBAN, respondents.

The records show that spouses Urbano Panganiban and Roberta Espino owned, as conjugal property, during their lifetime 29 parcels of unregistered land with improvements thereon, all situated in Dampol 1st, Pulilan, Bulacan. On February 18, 1903, Roberta Espino died intestate and without debts in Pulilan, Bulacan, where she was a resident before and at the time of her death. She left her husband, Urbano Panganiban, and their two legitimate children, Mercedes and Gaudencia as her only forced heirs. On September 18, 1952, Urbano Panganiban died also intestate and without debts in Pulilan, Bulacan, leaving as his only compulsory heirs the children of Gaudencia (who together with her sister Mercedes, had predeceased their father) who are now petitioners herein and his legitimate children with his second wife, Atanacia Agustin, who are the private respondents herein. The records also disclose that on June 19, 1981, or 28 years, 9 months and 1 day after Urbano's death, petitioners instituted an action with the then CFI of Bulacan for

Ernesto T. Zshornack, Jr. for petitioners.

partition and delivery of possession of their corresponding shares in the conjugal estate of decedents-spouses Urbano and Roberta consisting of subject 29 parcels of unregistered land. Petitioners filed the case because since the death of Urbano, their grandfather, in 1952, private respondents (his children by the second marriage) had taken possession of the whole conjugal property and appropriated to themselves to the exclusion of petitioners the products coming from the 29 parcels of land. cdrep On September 30, 1981 or around three (3) months from the filing of the civil case, respondent judge issued the questioned order. Petitioners' motion for reconsideration of the same was denied on January 12, 1982. Hence, this petition which petitioners filed on April 5, 1982 praying for the revocation of the questioned order and the reinstatement of this case in the trial court. Petitioners anchor their petition on the following grounds: 1. The subject parcels of land being unregistered lands do not come within the applicability of the decisions invoked which involve registered lands; 2. Assuming that the ten-year prescriptive period applies even in cases of unregistered lands, the prescriptive period did not commence to run against petitioners since there is no allegation, much less evidence, that private respondents had openly and effectively repudiated the co-ownership or constructive trust over the subject property; 3. There can be no constructive notice of an adverse claim of ownership in favor of private respondents by placing the subject lands in their names in the office of the Provincial Assessor; and 4. Petitioners' action for partition is still timely despite the lapse of almost 29 years during which private respondents had been in possession of the property. Private respondents, on the other hand, contend that the order appealed from has already become final and no longer appealable; and, that the petition is not meritorious because of the following: 1. The theory of constructive trust was brought out by petitioners themselves; 2. Petitioners cannot contradict their own admissions in the pleadings; 3. Petitioners slept on their alleged rights; and

4. Contrary to petitioners' claim, the jurisprudence cited by private respondents apply to unregistered lands. cdphil The resolution of this case hinges on the focal issue of prescription. We find the order of the trial court dismissing petitioners' complaint on the ground of prescription under Section 40 of Public Act No. 190 to be inaccurate. As We see it, this case is governed by the rules on co-ownership, since both parties are clearly co-owners of the disputed properties, having inherited the same from a common ancestor. Now then, Art. 494 (last paragraph) of the Civil Code provides:. "xxx xxx xxx "No prescription shall run in favor of a co-owner or co-heir against his co-owners or co-heirs so long as he expressly or impliedly recognizes the co-ownership." In view of their lack of a clear repudiation of the co-ownership, duly communicated to the petitioners (the other co-owners), private respondents cannot acquire the shares of the petitioners by prescription. The record in the Office of the Assessor is not the sufficient repudiation and communication contemplated by the law. Neither may the private respondents' possession of the premises militate against petitioners' claim. After all, co-owners are entitled to be in possession of the premises. The existence of the co-ownership here argues against the theory of implied trust, for then a co-owner possesses co-owned property not in behalf of the other co-owners but in his own behalf. Anent the contention that the judgment of the trial court has already become final and executory, the records reveal the contrary. The appeal was filed on time on April 5, 1982 or before April 28, 1982, the last day granted by this Court for the filing of the appeal. LLphil WHEREFORE, the assailed Order is SET ASIDE, and a new one is rendered remanding this case to the lower court for adjudication on the merits. SO ORDERED.

observance must be taken seriously if it is to attain its objective, i. e., the speedy and inexpensive disposition of cases. FIRST DIVISION [G.R. No. 76351. October 29, 1993.] VIRGILIO B. AGUILAR, petitioner, vs. COURT OF APPEALS and SENEN B. AGUILAR, respondents. 3. CIVIL LAW; CO-OWNERSHIP; RIGHT OF CO-OWNER OVER AN INDIVISIBLE PROPERTY. Article 494 of the Civil Code provides that no co-owner shall be obliged to remain in the co-ownership, and that each co-owner may demand at any time partition of the thing owned in common insofar as his share is concerned. Corollary to this rule, Art. 498 of the Code states that whenever the thing is essentially indivisible and the co-owners cannot agree that it be allotted to one of them who shall indemnify the others, it shall be sold and its proceeds accordingly distributed. This is resorted to (1) when the right to partition the property is invoked by any of the co-owners but because of the nature of the property it cannot be subdivided or its subdivision would prejudice the interests of the co-owners, and (b) the co-owners are not in agreement as to who among them shall be allotted or assigned the entire property upon proper reimbursement of the coowners. In one case, this Court upheld the order of the trial court directing the holding of a public sale of the properties owned in common pursuant to Art. 498 of the Civil Code. However, being a co-owner respondent has the right to use the house and lot without paying any compensation to petitioner, as he may use the property owned in common so long as it is in accordance with the purpose for which it is intended and in a manner not injurious to the interest of the other co-owners. Each co-owner of property held pro indiviso exercises his rights over the whole property and may use and enjoy the same with no other limitation than that he shall not injure the interests of his coowners, the reason being that until a division is made, the respective share of each cannot be determined and every co-owner exercises, together with his co-participants joint ownership over the pro indiviso property, in addition to his use and enjoyment of the same. 4. ID.; ID.; TERMINATION THEREOF; EFFECT; CASE AT BAR. Since petitioner has decided to enforce his right in court to end the co-ownership of the house and lot and respondent has not refuted the allegation that he has been preventing the sale of the property by his continued occupancy of the premises, justice and equity demand that respondent and his family vacate the property so that the sale can be effected immediately. In fairness to petitioner, respondent should pay a rental of P1,200.00 per month, with legal interest from the time the trial court ordered him to vacate, for the use and enjoyment of the other half of the property appertaining to petitioner. When petitioner filed an action to compel the sale of the property and the trial court granted the petition and ordered the ejectment of respondent, the co-ownership was deemed terminated and the right to enjoy the possession jointly also ceased. Thereafter, the continued stay of respondent and his family in the house prejudiced the interest of petitioner as the property should have been sold and the proceeds divided equally between them. To this extent and from then on, respondent should be held liable for monthly rentals until he and his family vacate.

Jose F. Manacop for petitioner. Siruelo, Muyco & Associates Law Office for private respondent.

SYLLABUS 1. REMEDIAL LAW; CIVIL PROCEDURE; PRE-TRIAL; APPEARANCE OF PARTIES THEREIN; MANDATORY. The law is clear that the appearance of parties at the pre-trial is mandatory. A party who fails to appear at a pre-trial conference may be non-suited or considered as in default. In the case at bar, where private respondent and counsel failed to appear at the scheduled pre-trial, the trial court has authority to declare respondent in default. 2. ID.; ID.; ID.; GRANT OR DENIAL OF POSTPONEMENT THEREOF; SUBJECT TO THE SOUND DISCRETION OF THE TRIAL JUDGE; CASE AT BAR. Although respondent's counsel filed a motion to postpone pre-trial hearing, the grant or denial thereof is within the sound discretion of the trial court, which should take into account two factors in the grant or denial of motions for postponement, namely: (a) the reason for the postponement and (b) the merits of the case of movant. In the instant case, the trial court found the reason stated in the motion of counsel for respondent to cancel the pre-trial to be without merit. Counsel's explanation that he had to go to Iloilo by boat as early as 25 March 1979 to fetch his wife and accompany her to a wedding in Dumaguete City on 27 April 1979 where she was one of the principal sponsors, cannot be accepted. We find it insufficient to justify postponement of the pre-trial, and the Court of Appeals did not act wisely in overruling the denial. We sustain the trial court and rule that it did not abuse its discretion in denying the postponement for lack of merit. Certainly, to warrant a postponement of a mandatory process as pre-trial would require much more than mere attendance in a social function. It is time indeed we emphasize that there should be much more than mere perfunctory treatment of the pre-trial procedure. Its

DECISION

proceeds thereof should be divided equally; and, that being a co-owner, he was entitled to the use and enjoyment of the property. Upon issues being joined, the case was set for pre-trial on 26 April 1979 with the lawyers of both parties notified of the pre-trial and served with the pre-trial order, with private respondent executing a special power of attorney to his lawyer to appear at the pre-trial and enter into any amicable settlement in his behalf. 1 On 20 April 1979, Atty. Manuel S. Tonogbanua, counsel for respondent, filed a motion to cancel pre-trial on the ground that he would be accompanying his wife to Dumaguete City where she would be a principal sponsor in a wedding. On 23 April 1979, finding the reasons of counsel to be without merit, the trial court denied the motion and directed that the pre-trial should continue as scheduled. When the case was called for pre-trial as scheduled on 26 April 1979, plaintiff and his counsel appeared. Defendant did not appear; neither his counsel in whose favor he executed a special power of attorney to represent him at the pre-trial. Consequently, the trial court, on motion of plaintiff, declared defendant as in default and ordered reception of plaintiff's evidence ex parte. On 7 May 1979, defendant through counsel filed an omnibus motion to reconsider the order of default and to defer reception of evidence. The trial court denied the motion and plaintiff presented his evidence. On 26 July 1979, rendering judgment by default against defendant, the trial court found him and plaintiff to be co-owners of the house and lot in equal shares on the basis of their written agreement. However, it ruled that plaintiff has been deprived of his participation in the property by defendant's continued enjoyment of the house and lot, free of rent, despite demands for rentals and continued maneuvers of defendant to delay partition. The trial court also upheld the right of plaintiff as co-owner to demand partition. Since plaintiff could not agree to the amount offered by defendant for the former's share, the trial court held that the property should be sold to a third person and the proceeds divided equally between the parties. The trial court likewise ordered defendant to vacate the property and pay plaintiff P1,200.00 as rentals 2 from January 1975 up to the date of decision plus interest from the time the action was filed. On 17 September 1979, defendant filed an omnibus motion for new trial but on 22 October 1979 the trial court denied the motion.

BELLOSILLO, J p: This is a petition for review on certiorari seeking to reverse and set aside the Decision of the Court of Appeals in CA-GR CV No. 03933 declaring null and void the orders of 23 and 26 April 1979, the judgment by default of 26 July 1979, and the order of 22 October 1979 of the then Court of First Instance of Rizal, Pasay City, Branch 30, and directing the trial court to set the case for pre-trial conference. LLjur Petitioner Virgilio and respondent Senen are brothers; Virgilio is the youngest of seven (7) children of the late Maximiano Aguilar, while Senen is the fifth. On 28 October 1969, the two brothers purchased a house and lot in Paraaque where their father could spend and enjoy his remaining years in a peaceful neighborhood. Initially, the brothers agreed that Virgilio's share in the co-ownership was two-thirds while that of Senen was one-third. By virtue of a written memorandum dated 23 February 1970, Virgilio and Senen agreed that henceforth their interests in the house and lot should be equal, with Senen assuming the remaining mortgage obligation of the original owners with the Social Security System (SSS) in exchange for his possession and enjoyment of the house together with their father. llcd Since Virgilio was then disqualified from obtaining a loan from SSS, the brothers agreed that the deed of sale would be executed and the title registered in the meantime in the name of Senen. It was further agreed that Senen would take care of their father and his needs since Virgilio and his family were staying in Cebu. After Maximiano Aguilar died in 1974, petitioner demanded from private respondent that the latter vacate the house and that the property be sold and proceeds thereof divided among them. Because of the refusal of respondent to give in to petitioner's demands, the latter filed on 12 January 1979 an action to compel the sale of the house and lot so that the they could divide the proceeds between them. In his complaint, petitioner prayed that the proceeds of the sale be divided on the basis of two-thirds (2/3) in his favor and one-third (1/3) to respondent. Petitioner also prayed for monthly rentals for the use of the house by respondent after their father died. cdphil In his answer with counterclaim, respondent alleged that he had no objection to the sale as long as the best selling price could be obtained; that if the sale would be effected, the

Defendant sought relief from the Court of Appeals praying that the following orders and decision of the trial court be set aside: (a) the order of 23 April 1970 denying defendant's motion for postponement of the pre-trial set on 26 April 1979; (b) the order of 26 April 1979 declaring him in default and authorizing plaintiff to present his evidence ex-parte; (c) the default judgment of 26 July 1979; and, (d) the order dated 22 October 1979 denying his omnibus motion for new trial. On 16 October 1986, the Court of Appeals set aside the order of the trial court of 26 April 1979 as well as the assailed judgment rendered by default. The appellate court found the explanation of counsel for defendant in his motion to cancel pre-trial as satisfactory and devoid of a manifest intention to delay the disposition of the case. It also ruled that the trial court should have granted the motion for postponement filed by counsel for defendant who should not have been declared as in default for the absence of his counsel. LLpr Petitioner now comes to us alleging that the Court of Appeals erred (1) in not holding that the motion of defendant through counsel to cancel the pre-trial was dilatory in character and (2) in remanding the case to the trial court for pre-trial and trial. The issues to be resolved are: whether the trial court correctly declared respondent as in default for his failure to appear at the pre-trial and in allowing petitioner to present his evidence ex-parte, and whether the trial court correctly rendered the default judgment against respondent. We find merit in the petition. As regards the first issue, the law is clear that the appearance of parties at the pre-trial is mandatory. 3 A party who fails to appear at a pre-trial conference may be non-suited or considered as in default. 4 In the case at bar, where private respondent and counsel failed to appear at the scheduled pre-trial, the trial court has authority to declare respondent in default. 5 Although respondent's counsel filed a motion to postpone pre-trial hearing, the grant or denial thereof is within the sound discretion of the trial court, which should take into account two factors in the grant or denial of motions for postponement, namely: (a) the reason for the postponement and (b) the merits of the case of movant. 6 In the instant case, the trial court found the reason stated in the motion of counsel for respondent to cancel the pre-trial to be without merit. Counsel's explanation that he had to go to Iloilo by boat as early as 25 March 1979 to fetch his wife and accompany her to a wedding in Dumaguete City on 27 April 1979 where she was one of the principal sponsors, cannot be accepted. We find it insufficient to justify postponement of the pre-

trial, and the Court of Appeals did not act wisely in overruling the denial. We sustain the trial court and rule that it did not abuse its discretion in denying the postponement for lack of merit. Certainly, to warrant a postponement of a mandatory process as pre-trial would require much more than mere attendance in a social function. It is time indeed we emphasize that there should be much more than mere perfunctory treatment of the pre-trial procedure. Its observance must be taken seriously if it is to attain its objective., i.e., the speedy and inexpensive disposition of cases. LLpr Moreover, the trial court denied the motion for postponement three (3) days before the scheduled pre-trial. If, indeed, counsel for respondent could not attend the pre-trial on the scheduled date, respondent at least should have personally appeared in order not to be declared as in default. But, since nobody appeared for him, the order of the trial court declaring him as in default and directing the presentation of petitioner's evidence ex parte was proper. 7 With regard to the merits of the judgment of the trial court by default, which respondent appellate court did not touch upon in resolving the appeal, the Court holds that on the basis of the pleadings of the parties and the evidence presented ex parte, petitioner and respondents are co-owners of subject house and lot in equal shares; either one of them may demand the same of the house and lot at any time and the other cannot object to such demand; thereafter the proceeds of the sale shall be divided equally according to their respective interests. Private respondent and his family refuse to pay monthly rentals to petitioner from the time their father died in 1975 and to vacate the house so that it can be sold to third persons. Petitioner alleges that respondent's continued stay in the property hinders its disposal to the prejudice of petitioner. On the part of petitioner, he claims that he should be paid two-thirds (2/3) of a monthly rental of P2,400.00 or the sum of P1,600.00. In resolving the dispute, the trial court ordered respondent to vacate the property so that it could be sold to third persons and the proceeds divided between them equally, and for respondent to pay petitioner one-half (1/2) of P2,400.00 or the sum of P1,200.00 as monthly rental, conformably with their stipulated sharing reflected in their written agreement. We uphold the trial court in ruling in favor of petitioner, except as to the effectivity of the payment of monthly rentals by respondent as co-owner which we here declare to commence only after the trial court ordered respondent to vacate in accordance with its order of 26 July 1979. LLphil

Article 494 of the Civil Code provides that no co-owner shall be obliged to remain in the co-ownership, and that each co-owner may demand at any time partition of the thing owned in common insofar as his share is concerned. Corollary to this rule, Art. 498 of the Code states that whenever the thing is essentially indivisible and the co-owners cannot agree that it be allotted to one of them who shall indemnify the others, it shall be sold and its proceeds accordingly distributed. This is resorted to (1) when the right to partition the property is invoked by any of the co-owners but because of the nature of the property it cannot be subdivided or its subdivision would prejudice the interests of the co-owners, and (b) the co-owners are not in agreement as to who among them shall be allotted or assigned the entire property upon proper reimbursement of the coowners. In one case, 8 this Court upheld the order of the trial court directing the holding of a public sale of the properties owned in common pursuant to Art. 498 of the Civil Code. However, being a co-owner respondent has the right to use the house and lot without paying any compensation to petitioner, as he may use the property owned in common so long as it is in accordance with the purpose for which it is intended and in a manner not injurious to the interest of the other co-owners. 9 Each co-owner of property held pro indiviso exercises his rights over the whole property and may use and enjoy the same with no other limitation than that he shall not injure the interests of his coowners, the reason being that until a division is made, the respective share of each cannot be determined and every co-owner exercises, together with his co-participants joint ownership over the pro indiviso property, in addition to his use and enjoyment of the same. 10 Since petitioner has decided to enforce his right in court to end the co-ownership of the house and lot and respondent has not refuted the allegation that he has been preventing the sale of the property by his continued occupancy of the premises, justice and equity demand that respondent and his family vacate the property so that the sale can be effected immediately. In fairness to petitioner, respondent should pay a rental of P1,200.00 per month, with legal interest from the time the trial court ordered him to vacate, for the use and enjoyment of the other half of the property appertaining to petitioner. When petitioner filed an action to compel the sale of the property and the trial court granted the petition and ordered the ejectment of respondent, the co-ownership was deemed terminated and the right to enjoy the possession jointly also ceased. Thereafter, the continued stay of respondent and his family in the house prejudiced the interest of petitioner as the property should have been sold and the proceeds divided equally between them. To this extent and from then on, respondent should be held liable for monthly rentals until he and his family vacate.

WHEREFORE, the petition is GRANTED. The assailed Decision of the Court of Appeals dated 16 October 1986 is REVERSED and SET ASIDE. The decision of the trial court in Civil Case No. 6912-P dated 26 July 1979 is REINSTATED, with the modification that respondent Senen B. Aguilar is ordered to vacate the premises in question within ninety (90) days from receipt of this decision, and to pay petitioner Virgilio B. Aguilar a monthly rental of P1,200.00 with interest at the legal rate from the time he received the decision of the trial court directing him to vacate until he effectively leaves the premises. LLpr The trial court is further directed to take immediate steps to implement this decision conformably with Art. 498 of the Civil Code and the Rules of Court. This decision is final and executory. SO ORDERED.

FIRST DIVISION [G.R. No. 46296. September 24, 1991.] EPITACIO DELIMA, PACIANO DELIMA, FIDEL DELIMA, VIRGILIO DELIMA, GALILEO DELIMA, JR., BIBIANO BACUS, OLIMPIO BACUS and PURIFICACION BACUS, petitioners, vs. HON. COURT OF APPEALS, GELILEO DELIMA (deceased), substituted by his legal heirs, namely; FLAVIANA VDA. DE DELIMA, LILY D. ARIAS, HELEN NIADAS, ANTONIO DELIMA, DIONISIO DELIMA, IRENEA DELIMA, ESTER DELIMA AND FELY DELIMA, respondents.

Gabriel J. Canete for petitioners. Emilio Lumontad, Jr. for private respondents.

DECISION

MEDIALDEA, J p: This is a petition for review on certiorari of the decision of the Court of Appeals reversing the trial court's judgment which declared as null and void the certificate of

title in the name of respondents' predecessor and which ordered the partition of the disputed lot among the parties as co-owners. The antecedent facts of the case as found both by the respondent appellate court and by the trial court are as follows: During his lifetime, Lino Delima acquired Lot No. 7758 of the Talisay-Minglanilla Friar Lands Estate in Cebu by sale on installments from the government. Lino Delima later died in 1921 leaving as his only heirs three brothers and a sister namely: Eulalio Delima, Juanita Delima, Galileo Delima and Vicente Delima. After his death, TCT No. 2744 of the property in question was issued on August 3, 1953 in the name of "The Legal Heirs of Lino Delima, deceased, represented by Galileo Delima." On September 22, 1953, Galileo Delima, now substituted by respondents, executed an affidavit of "Extra-judicial Declaration of Heirs." Based on this affidavit, TCT No. 2744 was cancelled and TCT No. 3009 was issued on February 4, 1954 in the name of Galileo Delima alone to the exclusion of the other heirs. Galileo Delima declared the lot in his name for taxation purposes and paid the taxes thereon from 1954 to 1965. On February 29, 1968, petitioners, who are the surviving heirs of Eulalio and Juanita Delima, filed With the Court of First Instance of Cebu (now Regional Trial Court) an action for reconveyance and/or partition of property and for the annulment of TCT No. 3009 with damages against their uncles Galileo Delima and Vicente Delima,. Vicente Delima was joined as party defendant by the petitioners for his refusal to join the latter in their action. On January 16, 1970, the trial court rendered a decision in favor of petitioners, the dispositive portion of which states: cdphil "IN VIEW OF THE FOREGOING CONSIDERATIONS, the following are the declared owners of Lot No. 7758 of the Talisay-Minglanilla Friar Lands Estate presently covered by Transfer Certificate of Title No. 3009, each sharing a pro-indiviso share of one-fourth; 1) Vicente Delima (one-fourth) 2) Heirs of Juanita Delima, namely: Bibiano Bacus, Olimpio Bacus and Purificacion Bacus (one-fourth),

3) Heirs of Eulalio Delima, namely Epitacio, Paciano, Fidel, Virgilio and Galileo Jr., all surnamed Delima (one-fourth); and 4) The Heirs of Galileo Delima, namely Flaviana Vda. de Delima, Lily D. Arias, Helen Niadas, and Dionisio, Antonio, Eotu, Irenea, and Fely, all surnamed Delima (one-fourth). "Transfer Certificate of Title No. 3009 is declared null and void and the Register of Deeds of Cebu is ordered to cancel the same and issue in lieu thereof another title with the above heirs as proindiviso owners. "After the payment of taxes paid by Galileo Delima since 1958, the heirs of Galileo Delima are ordered to turn over to the other heirs their respective shares of the fruits of the lot in question computed at P170.00 per year up to the present time with legal (interest). "Within sixty (60) days from receipt of this decision the parties are ordered to petition the lot in question and the defendants are directed to immediately turn over possession of the shares here awarded to the respective heirs. "Defendants are condemned to pay the costs of the suit. "The counterclaim is dismissed. "SO ORDERED." (pp. 54-55, Rollo). Not satisfied with the decision, respondents appealed to the Court of Appeals. On May 19, 1977, respondent appellate court reversed the trial court's decision and upheld the claim of Galileo Delima that all the other brothers and sister of Lino Delima, namely Eulalio, Juanita and Vicente, had already relinquished and waived their rights to the property in his favor, considering that he (Galileo Delima) alone paid the remaining balance of the purchase price of the lot and the realty taxes thereon (p. 26, Rollo). Hence, this petition was filed with the petitioners alleging that the Court of Appeals erred: "1) In not holding that the right of a co-heir to demand partition of inheritance is imprescriptible. If it does, the defenses of prescription and laches have already been waived.

"2) In disregarding the evidence of the petitioners." (p. 13, Rollo). The issue to be resolved in the instant case is whether or not petitioners' action for partition is already barred by the statutory period provided by law which shall enable Galileo Delima to perfect his claim of ownership by acquisitive prescription to the exclusion of petitioners from their shares in the disputed property. LLpr Article 494 of the Civil Code expressly provides: "Art. 494. No co-owner shall be obliged to remain in the coownership. Each co-owner may demand at any time the partition of the thing owned in common, insofar as his share is concerned. "Nevertheless, an agreement to keep the thing undivided for a certain period of time, not exceeding ten years, shall be valid. This term may be extended by a new agreement. "A donor or testator may prohibit partition for a period which shall not exceed twenty years. "Neither shall there be any partition when it is prohibited by law. "No prescription shall run in favor of a co-owner or co-heir against his co-owners or co-heirs so long as he expressly or impliedly recognizes the co-ownership." As a rule, possession by a co-owner will not be presumed to be adverse to the others, but will be held to benefit all. It is understood that the co-owner or co-heir who is in possession of an inheritance pro-indiviso for himself and in representation of his coowners or co-heirs, if, as such owner, he administers or takes care of the rest thereof with the obligation of delivering it to his co-owners or co-heirs, is under the same situation as a depository, a lessee or a trustee ( Bargayo v. Camumot, 40 Phil. 857; Segura v. Segura, No. L-29320, September 19, 1988, 165 SCRA 368). Thus, an action to compel partition may be filed at any time by any of the co-owners against the actual possessor. In other words, no prescription shall run in favor of a co-owner against his coowners or co-heirs so long as he expressly or impliedly recognizes the co-ownership (Del Blanco v. Intermediate Appellate Court, No. 72694, December 1 , 1987, 156 SCRA 55). However, from the moment one of the co-owners claims that he is the absolute and exclusive owner of the properties and denies the others any share therein, the question involved is no longer one of partition but of ownership (De Castro v. Echarri, 20 Phil. 23;

Bargayo v. Camumot, supra; De los Santos v. Santa Teresa , 44 Phil. 811). In such case, the imprescriptibility of the action for partition can no longer be invoked or applied when one of the co-owners has adversely possessed the property as exclusive owner for a period sufficient to vest ownership by prescription. It is settled that possession by a co-owner or co-heir is that of a trustee. In order that such possession is considered adverse to the cestui que trust amounting to a repudiation of the co-ownership, the following elements must concur: 1) that the trustee has performed unequivocal acts amounting to an ouster of the cestui que trust; 2) that such positive acts of repudiation had been made known to the cestui que trust; and 3) that the evidence thereon should be clear and conclusive ( Valdez v. Olorga, No. L-22571, May 25, 1973, 51 SCRA 71; Pangan v. Court of Appeals, No. L-39299, October 18, 1988, 166 SCRA 375). We have held that when a co-owner of the property in question executed a deed of partition and on the strength thereof obtained the cancellation of the title in the name of their predecessor and the issuance of a new one wherein he appears as the new owner of the property, thereby in effect denying or repudiating the ownership of the other co-owners over their shares, the statute of limitations started to run for the purposes of the action instituted by the latter seeking a declaration of the existence of the co-ownership and of their rights thereunder (Castillo v. Court of Appeals, No. L18046, March 31, 1964, 10 SCRA 549). Since an action for reconveyance of land based on implied or constructive trust prescribes after ten (10) years, it is from the date of the issuance of such title that the effective assertion of adverse title for purposes of the statute of limitations is counted (Jaramil v. Court of Appeals, No. L-31858, August 31, 1977, 78 SCRA 420). LLphil Evidence shows that TCT No. 2744 in the name of the legal heirs of Lino Delima, represented by Galileo Delima, was cancelled by virtue of an affidavit executed by Galileo Delima and that on February 4, 1954, Galileo Delima obtained the issuance of a new title in his name numbered TCT No. 3009 to the exclusion of his co-heirs. The issuance of this new title constituted an open and clear repudiation of the trust or coownership, and the lapse of ten (10) years of adverse possession by Galileo Delima from February 4, 1954 was sufficient to vest title in him by prescription. As the certificate of title was notice to the whole world of his exclusive title to the land, such rejection was binding on the other heirs and started as against them the period of prescription. Hence, when petitioners filed their action for reconveyance and/or to compel partition on February 29, 1963, such action was already barred by prescription. Whatever claims the other co-heirs could have validly asserted before can no longer be invoked by them at this time.

ACCORDINGLY, the petition is hereby DENIED and the assailed decision of the Court of Appeals dated May 19, 1977 is AFFIRMED. SO ORDERED.

FIRST DIVISION [G.R. No. L-39299. October 18, 1988.] ISAAC, SEVERINO, MARIA, TELESFORA, FELISA, SERAPIO, SIMEON and MACARIA, all surnamed PANGAN, petitioners, vs. COURT OF APPEALS and TEODORA GARCIA, respondents.

On June 8, 1966, the herein private respondent filed a petition to set aside the said decision, which the trial court 3 granted, admitting at the same time her opposition to the application and setting the case for reception of her evidence. This evidence sought to show that the land was inherited by Leon Hilario's three children, but the son, Felicisimo, waived his right thereto and thereby made his two sisters, Silvestra and Catalina, its exclusive co-owners. As Catalina's daughter, she was entitled to one-half of the property, the order half going to Silvestra's heirs, the petitioners herein and the latter's grandchildren. 4 On September 13, 1968, the trial judge issued an order dismissing the opposition and reinstating his original order of March 31, 1966. 5 His reason was that whatever rights Teodora might have had over the property had been forfeited by extinctive prescription because she had left the land in 1942 and had not since then asserted any claim thereto until 1966. On appeal to the respondent court, 6 this decision was reversed on the ground that the appellees had not clearly proved that they had acquired the property by prescription. Hence, the appellant was entitled to one-half of the property as heir, conformably to her opposition in the court a quo. Their motion for reconsideration having denied, they have now come to this Court in a petition for review by certiorari under Rule 45 of the Rules of Court. The petitioner's position is that the respondent court erred in holding that the private respondent was entitled to one-half of the land, which she had not lost by extinctive prescription because it was held by them in trust for her. They also insist that the appealed decision completely disregarded the factual findings of the trial court that they had acquired the whole land by virtue of their long, continued and adverse possession thereof, which should bar any claim by Teodora to her supposed part ownership. It is stressed at the outset that the appellate court is not necessarily bound by the factual findings of the trial court simply because the latter had the opportunity to observe the witnesses and assess their credibility by their deportment. While this may be a conceded advantage of the trial judge, the appellate court may still reverse his findings of fact is they are not based on the evidence submitted or have been reached without considering the matters of record that might have dictated a different conclusion. The Court of Appeals precisely is vested with jurisdiction to review questions of fact as decided by the lower court. It would be evading this responsibility if it should merely adopt the findings in the decision under review on the convenient justification that the trial judge had the opportunity, which it did not have, of gauging the realiability of the witnesses first-hand.

Magtanggol C. Gunigundo for petitioners. David C. Canta for private respondent.

DECISION

CRUZ, J p: The property in question is a parcel of land with an area of 635 square meters and situated in San Pascual, Obando, Bulacan. 1 It was originally owned by Leon Hilario and is now being disputed between the herein petitioners, who are his great grandchildren by his daughter Silvestra, and the private respondent, Teodora Garcia, who is his granddaughter by his daughter Catalina. 2 In 1964, the petitioners filed an application for the registration of the land in their names by virtue of their continuous and exclusive possession thereof since 1895, by themselves and their father and grandfather before them. After proper notices by publication and posting as required the trial court issued an order of general default, there being no opposition to the application, and proceeded to hear the evidence of the applicants ex-parte. On the basis thereof, the application was approved on March 31, 1966.

When, therefore, the respondent court accepted the private respondent's allegation that the land was inherited by the parties from their common ancestor, Leon Hilario, such finding, based on the record and not rejected but even assumed by the trial court, did not, in our view, constitute grave abuse of discretion. And when, on the strength of this finding, it then held that an implied trust was created between the petitioners who were in possession of the land, and Teodora Garcia, their aunt and co-heir, that too, as we see it, is not an arbitrary assumption. In fact the Court feels this is the more plausible relationship between the parties, compared to the version offered by the petitioners, who claim they acquired the property from their grandfather through their father, who apparently acquired it from his mother, Leon Hilario's daughter. It does not appear that they have pre-empted the other heirs to the property through any other mode of acquisition, like sale or some similar exclusive transaction. They have not submitted any evidence of how they acquired the land from their great grandfather, confining themselves to the assertion that they have continued his original possession presumably as heirs of their father, who inherited from his mother Silvestra, who was the daughter of Hilario. If this be their theory, then they unavoidably must recognize Teodora Garcia's own claim to the subject property as she too was an heir, being the daughter of Catalina, who was also a daughter of Hilario. The trial court said, however, that assuming Teodora had the right to the disputed property, the same was forfeited by her through extinctive prescription by failure to assert it in time. In its original decision, it affirmed the petitioner's claim that they had acquired ownership over the whole property by their possession thereof for more than thirty years in concept of owner. Teodora Garcia apparently did not challenge such ownership and so by her inaction forever lost the right to do so. The respondent court, rejecting this contention held that the petitioners' possession was not for their benefit alone but also in favor of Teodora, who was a co-heir with them and therefore also a co-owner of the property. In other words, their possession, while adverse to the rest of the world, was not against Teodora herself, whose share they held in implied trust for her as a co-owner of the land, and whose fruits their father shared with her occasionally, or at least promised her she would get eventually. The Court believes that this, too, is not an arbitrary conclusion. To support their claim of exclusive ownership of the entire land,. the petitioners stress that the property was declared for taxation purposes in the name of Tomas Pangan, their father, in 1948 and another tax declaration was issued, also in his name, in 1965. Moreover, real estate taxes were paid by them 1908 to 1914,

1930 to 1932, 1956 to 1957, and 1960 to 1965, whereas Teodora Garcia, by her own admission, never paid any tax at all on the disputed land. 7 Tax declarations are indicia but not conclusive proof of ownership. 8 If the property was declared in the name of Tomas Pangan only, it could be that this was done only for reasons of convenience, more so if it was understood, as the private respondent did, that he was declaring the property not only for himself but for herself also as the other co-owner. As for the admitted fact that Teodora Garcia never actually paid the real estate taxes, the explanation she gave was that she assumed her share of such taxes was being paid from her share in the fruits of her portion of the land, which she said she was not getting regularly, much less in full. We hold that this explanation is also plausible enough. But for all this, there is still the question of whether or not Teodora Garcia, her failure to assert her right, allowed the statutory period to lapse, thus enabling the petitioners to perfect their claim of ownership by acquisitive prescription and so exclude her from her share in the subject property. It is settled rule that possession by one-co-owner will not be regarded as adverse to the other co-owners but in fact as beneficial to all of them. 9 Hence, as long as his co-ownership is recognized, an action to compel partition will not prescribe and may be filed at any time against the actual possessor by any of the other co-owners. 10 However, if the co-owner actually holding the property asserts exclusive dominion over it against the other co-owners, the corollary of the rule is that he can acquire sole title to, it after the lapse of the prescribed prescriptive period. From that moment, the question involved will be one of ownership and no longer mere partition. 11 According to the petitioners, there was such repudiation which was admitted by the private respondent herself. Testifying for herself at the hearing on her opposition in the registration proceedings, she declared: "ATTY. CANLAS: "Q. After the death of Tomas Pangan, did you ask the heirs of Tomas Pangan of your alleged share in the property in question? "A. Yes, sir. "Q. What did they tell you?

"A They said that I have no right to a share and they won't give me my share "Q. How many years ago did you ask from them? "A. Immediately after the death of their father. "Q. That was some 20 years ago? "A. I do not know how many years ago. "Q. And during all that span of more than 20 years ago you did not file any action to recover your share on the land in question? "A. No sir, it was only this time." 12 For title to prescribe in favor of the co-owner, however, there must be a clear showing that he has repudiated the claims of the other co-owners and that they have been categorically advised of the exclusive claim he is making to the property in question. It is only when such unequivocal notice has been given that the period of prescription will begin to run against the other co-owners and ultimately divest them of their own title if they do not seasonably defend it. 13

manifested by a formal legal action, to make the prescriptive period start to run against the claimant. Thus "Filing by a trustee of an action in court against the trustor to quiet title to property, or for recovery of ownership thereof, held in possession by the former, may constitute an act of repudiation of the trust reposed on him by the latter." 15 "The issuance of the certificate of title would constitute an open and clear repudiation of any trust, and the lapse of more than 20 years, open and adverse possession as owner would certainly suffice to vest title by prescription." 16 "An action for the reconveyance of land based on implied or constructive trust prescribes within 10 years. And it is from the date of the issuance of such title that the effective assertion of adverse title for purposes of the statute of limitation is counted." 17 "The prescriptive period may only be counted from the time petitioners repudiated the trust relation in 1955 upon the filing of the complaint for recovery of possession against private respondents so that the counterclaim of the private respondents contained in their amended answer wherein they asserted absolute ownership of the disputed realty by reason of the continuous and adverse possession of the same is well within the 10-year prescriptive period." 18 "There is clear repudiation of a trust when one who is an apparent administrator of property causes the cancellation of the title thereto in the name of the apparent beneficiaries and gets a new certificate of title in his own name." 19 "It is only when the defendants, alleged co-owners of the property in question, executed a deed of partition and on the strength thereof obtained the cancellation of the title in the name of their predecessor and the issuance of a new one wherein they appear as the new owners of a definite area each, thereby in effect denying or repudiating the ownership of one of the plaintiffs over his alleged share in the entire lot, that the statute of limitations started to run for the purposes of that action instituted by the latter seeking a declaration of the existence of the co-ownership and of their rights thereunder." 20

Adverse circumstances:

possession

requires

the

concurrence

of

the

following

1. That the trustee has performed unequivocal acts amounting to an ouster of the cestui que trust; 2. That such positive acts of repudiation had been made known to the cestui que trust; and 3. That the evidence thereon should be clear and conclusive. 14 On the basis of the evidence presented by the parties, the Court is not convinced that the above requirements have been satisfied. Although there are admittedly some precedents to the contrary, it would appear that the weight of authority requires a categorical and final rejection of the co-owners' claim, usually

The established evidence clearly shows that the subject land was inherited by the petitioners and the private respondent as co-heirs of their common ancestor, Leon Hilario, whose possession they continued to acquire prescriptive title over the property. That possession was originally in the name of all the heirs, including Teodora Garcia, who in fact had been assured by Tomas Pangan, the petitioners' father that she would get the share to which she was entitled. The petitioners have not proved that their possession excluded their co-owner and aunt or that they derived their title from a separate conveyance to them of the property by Leon Hilario. Parenthetically, such a conveyance, if it existed, would be questionable as it might have deprived Leon's other children of their legitime. In any case, the petitioners appear to have arrogated the entire property to themselves upon their father's death sometime in 1942 or at the latest in 1965 when they sought to register the land in their names to the exclusion of Teodora Garcia. The question is, Did such an act begin the period of extinctive prescription against the private respondent? Manifestly, the petitioners have acted in bad faith in denying their aunt and co-heir her legal share to the property they had all inherited from Leon Hilario through their respective parents. This is regrettable as Teodora Garcia is their father's first cousin who apparently trusted him and, indeed, relied on his promise that her share would be protected. Tomas Pangan presumably was sincere in this assurance, but it was unfortunately not honored by his children upon his death for they soon dismissed out of hand Teodora Garcia's claim to the subject property. In cases where there is a clear showing of imposition and improper motives, the courts must be vigilant in the protection of the rights of the exploited. 21 So said the respondent court, and we agree. We note that the private respondent "is a poor and ignorant 62-year old widow" * whose misplaced trust in her nephews and nieces is being used now precisely to defeat her claim to the share that she believes is rightfully hers. It is a sorry spectacle, indeed, to see her own close kin ganging up on her, so to speak, to deprive her small heritage, and in her old age at that. With all this in mind we affirm the finding of the respondent court that there was no adequate notice by the petitioners to the private respondent of the rejection of her claim to her share in the subject property. Noticeably absent here is a categorical assertion by the petitioners of their exclusive right to the entire property that barred her own claim of ownership of one-half thereof nor is there any explanation as to why they said she had no right to a share. If this trusting woman did not immediately take legal action to protect her rights, it was simply because of forbearance toward her nephews and nieces, let alone the fact that there was really no casus belli as yet that required her to act decisively. That legal provocation arose only when the petitioners commenced the registration

proceedings in 1965, and it was from that time she was required to act, as she did, to protect her interests. In an earlier case, 22 we stressed that this Court is not only a court of law but also of justice. Faced with a choice between a decision that will serve justice and another that will deny it because of a too-strict interpretation of the law, we must resolve in favor of the former, for the ultimate end of the law is justice. Bunos judex secundum aequum at bonum judicat stricto juri praefert . 23 This is a wise maxim we will follow here in ruling for the deprived and ignorant old widow. WHEREOF, the petition is DENIED and the challenged decision AFFIRMED in full, with costs against the petitioners. It is ordered.

Separate Opinion GANCAYCO, J., dissenting: As private respondent admitted that petitioners verbally repudiated her claims as co-owner of the property it was effectively an unequivocal notice amounting to an ouster of the cestui que trust and the period of prescription began to run since then. It is not required that such a repudiation should be through a formal legal action. I, therefore vote to grant the petition by reversing and setting aside the decision of respondent court and its resolution denying the motion for reconsideration thereof, and reinstating the order of March 31, 1966 of the trial court.

THIRD DIVISION [G.R. No. 57062. January 24, 1992.] MARIA DEL ROSARIO MARIATEGUI, ET AL., petitioners, vs. HON. COURT OF APPEALS, JACINTO MARIATEGUI, JULIAN MARIATEGUI and PAULINA MARIATEGUI, respondents.

Montesa, Albon & Associates for petitioners.

Parmenio B. Patacsil, Patacsil Twins Law Office for the heirs of the late Maria del Rosario Mariategui. Tinga, Fuentes & Tagle Law Firm for private respondents.

SYLLABUS 1. REMEDIAL LAW; CIVIL PROCEDURE; ACTIONS, NATURE THEREOF, DETERMINED BY THE FACTS ALLEGED IN THE COMPLAINT. The Court of Appeals correctly adopted the settled rule that the nature of an action filed in court is determined by the facts alleged in the complaint constituting the cause of action (Republic vs. Estenzo, 158 SCRA 282 [1988]). It has been held that, if the relief demanded is not the proper one which may be granted under the law, it does not characterize or determine the nature of plaintiffs' action, and the relief to which plaintiff is entitled based on the facts alleged by him in his complaint, although it is not the relief demanded, is what determines the nature of the action (1 Moran, p. 127, 1979 ed., citing Baguioro vs. Barrios, et al., 77 Phil. 120). 2. ID.; EVIDENCE; PRESUMPTIONS, MAN AND WOMAN, DEPORTING THEMSELVES AS HUSBAND AND WIFE; PRESUMED TO HAVE ENTERED INTO A LAWFUL CONTRACT OF MARRIAGE; CASE AT BAR. Lupo Mariategui and Felipa Velasco were alleged to have been lawfully married in or about 1930. This fact is based on the declaration communicated by Lupo Mariategui to Jacinto who testified that "when (his) father was still living, he was able to mention to (him) that he and (his) mother were able to get married before a Justice of the Peace of Taguig, Rizal." The spouses deported themselves as husband and wife, and were known in the community to be such. Although no marriage certificate was introduced to this effect, no evidence was likewise offered to controvert these facts. Moreover, the mere fact that no record of the marriage exists does not invalidate the marriage, provided all requisites for its validity are present (People vs. Borromeo, 133 SCRA 106 [1984]). Under these circumstances, a marriage may be presumed to have taken place between Lupo and Felipa. The laws presume that a man and a woman, deporting themselves as husband and wife, have entered into a lawful contract of marriage; that a child born in lawful wedlock, there being no divorce, absolute or from bed and board is legitimate; and that things have happened according to the ordinary course of nature and the ordinary habits of life (Section 5(z), (bb), (cc), Rule 131, Rules of Court; Corpus v. Corpus, 85 SCRA 567 [1978]; Saurnaba v. Workmen's Compensation, 85 SCRA 502 [1978]; Alavado v. City Gov't. of Tacloban, 139 SCRA 230 [1985]; Reyes v. Court of Appeals, 135 SCRA 439 [1985]). 3. ID.; ID.; ID.; PRESUMPTION OF MARRIAGE; LOOKED WITH GREAT FAVOR BY COURT; RATIONALE. Courts look upon the presumption of marriage with great favor as it is founded on the following rationale: "The basis of human society throughout the civilized

world is that of marriage. Marriage in this jurisdiction is not only a civil contract, but it is a new relation, an institution in the maintenance of which the public is deeply interested. Consequently, every intendment of the law leans toward legalizing matrimony. Persons dwelling together in apparent matrimony are presumed, in the absence of any counter-presumption or evidence special to that case, to be in fact married. The reason is that such is the common order of society and if the parties were not what they thus hold themselves out as being, they would be living in the constant violation of decency and of law . . . ." (Adong vs. Cheong Seng Gee, 43 Phil. 43, 56 [1922] quoted in Alavado vs. City Government of Tacloban, 139 SCRA 230 [1985]). So much so that once a man and a woman have lived as husband and wife and such relationship is not denied nor contradicted, the presumption of their being married must be admitted as a fact (Alavado v. City Gov't. of Tacloban, 139 SCRA 230). 4. CIVIL LAW; PERSONS AND FAMILY RELATIONS; FILIATION; VARIOUS TYPES OF ILLEGITIMATE CHILDREN; ELIMINATED UNDER THE FAMILY CODE. The Civil Code provides for the manner under which legitimate filiation may be proven. However, considering the effectivity of the Family Code of the Philippines, the case at bar must be decided under a new if not entirely dissimilar set of rules because the parties have been overtaken by events, to use the popular phrase (Uyguangco vs. Court of Appeals, G.R. No. 76873, October 26, 1989). Thus, under Title VI of the Family Code, there are only two classes of children legitimate and illegitimate. The fine distinctions among various types of illegitimate children have been eliminated (Castro vs. Court of Appeals, 173 SCRA 656 [1989]). 5. ID.; ID.; ID.; HOW MAY BE ESTABLISHED; RULE. Article 172 of the Family Code provides that the filiation of legitimate children may be established by the record of birth appearing in the civil register or a final judgment or by the open and continuous possession of the status of a legitimate child. 6. ID.; PRESCRIPTION OF ACTION; DOES NOT LIE FOR AN ACTION FOR PARTITION; EXCEPTION. Prescription does not run against private respondents with respect to the filing of the action for partition so long as the heirs for whose benefit prescription is invoked, have not expressly or impliedly repudiated the co-ownership. In other words, prescription of an action for partition does not lie except when the co-ownership is properly repudiated by the co-owner (Del Banco vs. Intermediate Appellate Court, 156 SCRA 55 [1987] citing Jardin vs. Hollasco, 117 SCRA 532 [1982]). Otherwise stated, a coowner cannot acquire by prescription the share of the other co-owners absent a clear repudiation of co-ownership duly communicated to the other co-owners (Mariano vs. De Vega, 148 SCRA 342 [1987]). Futhermore, an action to demand partition is imprescriptible and cannot be barred by laches (Del Banco vs. IAC, 156 SCRA 55 [1987]).

7. ID.; ID.; ID.; ID.; REPUDIATION BY A CO-OWNER AS AN EXCEPTION; NOT APPRECIATED IN CASE AT BAR. Petitioners contend that they have repudiated the co-ownership when they executed the extrajudicial partition excluding the private respondents and registered the properties in their own names (Petition, p. 16; Rollo, p. 20). However, no valid repudiation was made by petitioners to the prejudice of private respondents. Assuming petitioners' registration of the subject lot in 1971 was an act of repudiation of the co-ownership, prescription had not yet set in when private respondents filed in 1973 the present action for partition (Ceniza vs. C.A., 182 SCRA 552 [1990]). Petitioners' registration of the properties in their names in 1971 did not operate as a valid repudiation of the co-ownership. In Adille vs. Court of Appeals (157 SCRA 455, 461-462 [1988]), the Court held: "Prescription, as a mode of terminating a relation of coownership, must have been preceded by repudiation (of the co-ownership). The act of repudiation, in turn, is subject to certain conditions: (1) a co-owner repudiates the coownership; (2) such an act of repudiation is clearly made known to the other co-owners; (3) the evidence thereon is clear and conclusive; and (4) he has been in possession through open, continuous, exclusive, and notorious possession of the property for the period required by law." . . . "It is true that registration under the Torrens system is constructive notice of title, but it has likewise been our holding that the Torrens title does not furnish shield for fraud. It is therefore no argument to say that the act of registration is equivalent to notice of repudiation, assuming there was one, notwithstanding the long-standing rule that registration operates as a universal notice of title."

Virginia and Federico, all surnamed Espina. Ireneo also died and left a son named Ruperto. With his second wife, Flaviana Montellano, he begot a daughter named Cresenciana who was born on May 8, 1910 (Rollo, Annex "A", p. 36) Lupo Mariategui and Felipa Velasco (Lupo's third wife) got married sometime in 1930. They had three children, namely: Jacinto, born on July 3, 1929, Julian, born on February 16, 1931 and Paulina, born on April 19, 1938. Felipa Velasco Mariategui died in 1941 (Rollo, Ibid). At the time of his death, Lupo Mariategui left certain properties which he acquired when he was still unmarried (Brief for respondents, Rollo, pp. 116; 4). These properties are described in the complaint as Lots Nos. 163, 66, 1346 and 156 of the Muntinlupa Estate (Rollo, Annex "A", p. 39). On December 2, 1967, Lupo's descendants by his first and second manages, namely, Maria del Rosario, Urbana, Ruperto, Cresencia, all surnamed Mariategui and Antero, Rufina, Catalino, Maria, Gerardo, Virginia and Federico, all surnamed Espina, executed a deed of extrajudicial partition whereby they adjudicated unto themselves Lot No. 163 of the Muntinglupa Estate. Thereafter, Lot No. 163 was the subject of a voluntary registration proceedings filed by the adjudicates under Act No. 496, and the land registration court issued a decree ordering the registration of the lot. Thus, on April 1, 1971, OCT No. 8828 was issued in the name of the above-mentioned heirs. Subsequently, the registered owners caused the subdivision of the said lot into Lots Nos. 163-A to 163-H, for which separate transfer certificates of title were issued to the respective parties (Rollo, ibid). LexLib On April 23, 1973, Lupo's children by his third marriage with Felipa Velasco (Jacinto, Julian and Paulina) filed with the lower court an amended complaint claiming that Lot No. 163 together with Lots Nos. 669, 1346 and 164 were owned by their common father, Lupo Mariategui, and that, with the adjudication of Lot No. 163 to their co-heirs, they (children of the third marriage) were deprived of their respective shares in the lots. Plaintiffs pray for partition of the estate of their deceased father and annulment of the deed of extrajudicial partition dated December 2, 1967 (Petition, Rollo, p. 10). Cresencia Mariategui Abas, Flaviana Mariategui Cabrera and Isabel Santos were impleaded in the complaint as unwilling defendants as they would not like to join the suit as plaintiffs although they acknowledged the status and rights of the plaintiffs and agreed to the partition of the parcels of land as well as the accounting of their fruits (Ibid., Rollo, p. 8; Record on Appeal, p. 4). The defendants (now petitioners) filed an answer with counterclaim (Amended Record on Appeal, p. 13). Thereafter, they filed a motion to dismiss on the grounds of lack of cause of action and prescription. They specifically contended that the complaint was

DECISION

BIDIN, J p: This is a petition for review on certiorari of the decision * of the Court of Appeals dated December 24, 1980 in CA-G.R. No. 61841, entitled "Jacinto Mariategui, et al. v. Maria del Rosario Mariategui, et al.," reversing the judgment of the then Court of First Instance of Rizal, Branch VIII ** at Pasig, Metro Manila. The undisputed facts are as follows: Lupo Mariategui died without a will on June 26, 1953 (Brief for respondents, Rollo, pp. 116; 8). During his lifetime, Lupo Mariategui contracted three (3) marriages. With his first wife, Eusebia Montellano, who died on November 8, 1904, he begot four (4) children, namely: Baldomera, Maria del Rosario, Urbana and Ireneo. Baldomera died and was survived by her children named Antero, Rufina, Catalino, Maria, Gerardo,

one for recognition of natural children. On August 14, 1974, the motion to dismiss was denied by the trial court, in an order the dispositive portion of which reads: "It is therefore the opinion of the Court that Articles 278 and 285 of the Civil Code cited by counsel for the defendants are of erroneous application to this case. The motion to dismiss is therefore denied for lack of merit. "SO ORDERED." (ibid, p. 37). However, on February 16, 1977, the complaint as well as petitioners' counterclaim were dismissed by the trial court, in its decision stating thus: "The plaintiffs' right to inherit depends upon the acknowledgment or recognition of their continuous enjoyment and possession of status of children of their supposed father. The evidence fails to sustain either premise, and it is clear that this action cannot be sustained. (Ibid, Rollo, pp. 67-68). The plaintiffs elevated the case to the Court of Appeals on the ground that the trial court committed an error ". . . in not finding that the parents of the appellants, Lupo Mariategui and Felipa Velasco (were) lawfully married, and in holding (that) they (appellants) are not legitimate children of their said parents, thereby divesting them of their inheritance . . . ." (Rollo, pp. 14-15) On December 24, 1980, the Court of Appeals rendered a decision declaring all the children and descendants of Lupo Mariategui, including appellants Jacinto, Julian and Paulina (children of the third manage) as entitled to equal shares in the estate of Lupo Mariategui; directing the adjudicates in the extrajudicial partition of real properties who eventually acquired transfer certificates of title thereto, to execute deeds of reconveyance in favor, and for the shares, of Jacinto, Julian and Paulina provided rights of innocent third persons are not prejudiced otherwise the said adjudicates shall reimburse the said heirs the fair market value of their shares; and directing all the parties to submit to the lower court a project of partition in the net estate of Lupo Mariategui after payment of taxes, other government charges and outstanding legal obligations. The defendants-appellees filed a motion for reconsideration of said decision but it was denied for lack of merit. Hence, this petition which was given due course by the court on December 7, 1981.

The petitioners submit to the Court the following issues: (a) whether or not prescription barred private respondents' right to demand the partition of the estate of Lupo Mariategui, and (b) whether or not the private respondents, who belatedly filed the action for recognition, were able to prove their successional rights over said estate. The resolution of these issues hinges, however, on the resolution of the preliminary matter, i.e., the nature of the complaint filed by the private respondents. The complaint alleged, among other things, that "plaintiffs are the children of the deceased spouses Lupo Mariategui . . . and Felipa Velasco"; that "during his lifetime, Lupo Mariategui had repeatedly acknowledged and confirmed plaintiffs as his children and the latter, in turn, have continuously enjoyed such status since their birth"; and "on the basis of their relationship to the deceased Lupo Mariategui and in accordance with the law on intestate succession, plaintiffs are entitled to inherit shares in the foregoing estate (Record on Appeal, pp. 5 & 6). It prayed, among others, that plaintiffs be declared as children and heirs of Lupo Mariategui and adjudication in favor of plaintiffs their lawful shares in the estate of the decedent (Ibid, p. 10). A perusal of the entire allegations of the complaint, however, shows that the action is principally one of partition. The allegation with respect to the status of the private respondents was raised only collaterally to assert their rights in the estate of the deceased. Hence, the Court of Appeals correctly adopted the settled rule that the nature of an action filed in court is determined by the facts alleged in the complaint constituting the cause of action (Republic vs. Estenzo, 158 SCRA 282 [1988]). It has been held that, if the relief demanded is not the proper one which may be granted under the law, it does not characterize or determine the nature of plaintiffs' action, and the relief to which plaintiff is entitled based on the facts alleged by him in his complaint, although it is not the relief demanded, is what determines the nature of the action (1 Moran, p. 127, 1979 ed., citing Baguioro vs. Barrios, et al., 77 Phil. 120). With respect to the legal basis of private respondents' demand for partition of the estate of Lupo Mariategui, the Court of Appeals aptly held that the private respondents are legitimate children of the deceased. Lupo Mariategui and Felipa Velasco were alleged to have been lawfully married in or about 1930. This fact is based on the declaration communicated by Lupo Mariategui to Jacinto who testified that "when (his) father was still living, he was able to mention to (him) that he and (his) mother were able to get married before a Justice of the Peace of Taguig, Rizal." The spouses deported themselves as husband and wife, and were known in the community to be such. Although no marriage certificate was introduced to this effect, no evidence was likewise offered to controvert these facts. Moreover, the mere

fact that no record of the marriage exists does not invalidate the marriage, provided all requisites for its validity are present (People vs. Borromeo, 133 SCRA 106 [1984]). Under these circumstances, a marriage may be presumed to have taken place between Lupo and Felipa. The laws presume that a man and a woman, deporting themselves as husband and wife, have entered into a lawful contract of marriage; that a child born in lawful wedlock, there being no divorce, absolute or from bed and board is legitimate; and that things have happened according to the ordinary course of nature and the ordinary habits of life (Section 5 (z), (bb), (cc), Rule 131, Rules of Court; Corpus v. Corpus, 85 SCRA 567 [1978]; Saurnaba v. Workmen's Compensation, 86 SCRA 502 [1978]; Alavado v. City Gov't. of Tacloban, 139 SCRA 230 [1985]; Reyes v. Court of Appeals, 135 SCRA 439 [1985]). Courts look upon the presumption of marriage with great favor as it is founded on the following rationale: "The basis of human society throughout the civilized world is that of marriage. Manage in this jurisdiction is not only a civil contract, but it is a new relation, an institution in the maintenance of which the public is deeply interested. Consequently, every intendment of the law leans toward legalizing matrimony Persons dwelling together in apparent matrimony are presumed, in the absence of any counterpresumption or evidence special to that case, to be in fact married. The reason is that such is the common order of society and if the parties were not what they thus hold themselves out as being, they would be living in the constant violation of decency and of law . . ." (Adong vs. Cheong Seng Gee, 43 Phil. 43, 56 [1922] quoted in Alavado vs. City Government of Tacloban, 139 SCRA 230 [1985]). So much so that once a man and a woman have lived as husband and wife and such relationship is not denied nor contradicted, the presumption of their being married must be admitted as a fact (Alavado v. City Gov't. of Tacloban, supra). The Civil Code provides for the manner under which legitimate filiation may be proven. However, considering the effectivity of the Family Code of the Philippines, the case at bar must be decided under a new if not entirely dissimilar set of rules because the parties have been overtaken by events, to use the popular phrase (Uyguangco vs. Court of Appeals, G.R. No. 76873, October 26, 1989). Thus, under Title VI of the Family Code, there are only two classes of children legitimate and illegitimate. The fine distinctions among various types of illegitimate children have been eliminated (Castro vs. Court of Appeals, 173 SCRA 656 [1989]).

Article 172 of the said Code provides that the filiation of legitimate children may be established by the record of birth appearing in the civil register or a final judgment or by the open and continuous possession of the status of a legitimate child. Evidence on record proves the legitimate filiation of the private respondents. Jacinto's birth certificate is a record of birth referred to in the said article. Again, no evidence which tends to disprove facts contained therein was adduced before the lower court. In the case of the two other private respondents, Julian and Paulina, they may not have presented in evidence any of the documents required by Article 172 but they continuously enjoyed the status of children of Lupo Mariategui in the same manner as their brother Jacinto. While the trial court found Jacinto's testimonies to be inconsequential and lacking in substance as to certain dates and names of relatives with whom their family resided, these are but minor details. The nagging fact is that for a considerable length of time and despite the death of Felipa in 1941, the private respondents and Lupo lived together until Lupo's death in 1953. It should be noted that even the trial court mentioned in its decision the admission made in the affidavit of Cresenciana Mariategui Abas, one of the petitioners herein, that ". . . Jacinto, Julian and Paulina Mariategui ay pawang mga kapatid ko sa ama . . ." (Exh. M, Record on Appeal, pp. 65-66). In view of the foregoing, there can be no other conclusion than that private respondents are legitimate children and heirs of Lupo Mariategui and therefore, the time limitation prescribed in Article 285 for filing an action for recognition is inapplicable to this case. Corollarily, prescription does not run against private respondents with respect to the filing of the action for partition so long as the heirs for whose benefit prescription is invoked, have not expressly or impliedly repudiated the co-ownership. In other words, prescription of an action for partition does not lie except when the co-ownership is properly repudiated by the co-owner (Del Banco vs. Intermediate Appellate Court, 156 SCRA 55 [1987] citing Jardin vs. Hollasco, 117 SCRA 532 [1982]). Cdpr Otherwise stated, a co-owner cannot acquire by prescription the share of the other coowners absent a clear repudiation of co-ownership duly communicated to the other coowners (Mariano vs. De Vega, 148 SCRA 342 [1987]). Furthermore, an action to demand partition is imprescriptible and cannot be barred by laches (Del Banco vs. IAC, 156 SCRA 65 [1987]). On the other hand, an action for partition may be seen to be at once an action for declaration of co-ownership and for segregation and conveyance of a determinate portion of the property involved (Roque vs. IAC, 165 SCRA 118 [1988]). Petitioners contend that they have repudiated the co-ownership when they executed the extrajudicial partition excluding the private respondents and registered the properties in their own names (Petition, p. 16; Rollo, p. 20). However, no valid

repudiation was made by petitioners to the prejudice of private respondents. Assuming petitioners' registration of the subject lot in 1971 was an act of repudiation of the coownership, prescription had not yet set in when private respondents filed in 1973 the present action for partition (Ceniza vs. C.A., 181 SCRA 552 [1990]). In their complaint, private respondents averred that in spite of their demands, petitioners, except the unwilling defendants in the lower court, failed and refused to acknowledge and convey their lawful shares in the estate of their father (Record on Appeal, p. 6). This allegation, though denied by the petitioners in their answer (Ibid, p. 14), was never successfully refuted by them. Put differently, in spite of petitioners' undisputed knowledge of their relationship to private respondents who are therefore their co-heirs, petitioners fraudulently withheld private respondent's share in the estate of Lupo Mariategui. According to respondent Jacinto, since 1962, he had been inquiring from petitioner Maria del Rosario about their (respondents) share in the property left by their deceased father and had been assured by the latter (Maria del Rosario) not to worry because they will get some shares. As a matter of fact, sometime in 1969, Jacinto constructed a house where he now resides on Lot No. 163 without any complaint from petitioners. Petitioners' registration of the properties in their names in 1971 did not operate as a valid repudiation of the co-ownership. In Adille vs. Court of Appeals (157 SCRA 455, 461462 [1988]), the Court held: "Prescription, as a mode of terminating a relation of co-ownership, must have been preceded by repudiation (of the co-ownership). The act of repudiation, in turn, is subject to certain conditions: (1) a coowner repudiates the co-ownership; (2) such an act of repudiation is clearly made known to the other co-owners; (3) the evidence thereon is clear and conclusive; and (4) he has been in possession through open, continuous, exclusive, and notorious possession of the property for the period required by law." xxx xxx xxx "It is true that registration under the Torrens system is constructive notice of title, but it has likewise been our holding that the Torrens title does not furnish shield for fraud. It is therefore no argument to say that the act of registration is equivalent to notice of repudiation, assuming there was one, notwithstanding the long-standing rule that registration operates as a universal notice of title."

Inasmuch as petitioners registered the properties in their names in fraud of their coheirs, prescription can only be deemed to have commenced from the time private respondents discovered the petitioners' act of defraudation (Adille vs. Court of Appeals, supra). Hence, prescription definitely may not be invoked by petitioners because private respondents commenced the instant action barely two months after learning that petitioners had registered in their names the lots involved. WHEREFORE, the petition is DENIED and the assailed decision of the Court of Appeals dated December 24, 1980 is Affirmed. SO ORDERED.