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LABAGALA VS SANTIAGO.................................................................................. 2
FRANCISCO VS HERRERA .................................................................................. 8
PARAGAS VS HEIRS OF DOMINADOR BALACANO .............................................12
HEIRS OF REYES VS MIJARES ............................................................................20
GUIANG VS CA ................................................................................................27
AINZA VS SPS. PADUA .....................................................................................34
SPS. FUENTES VS ROCA ...................................................................................38
SPS. AGGABAO VS SPS. PARULAN ....................................................................46
PELAYO VS PEREZ ............................................................................................56
ABALOS VS MACATANGAY JR ..........................................................................66
CALIMLIM- CANULLAS VS FORTUN ..................................................................72
PHIL. TRUST CO. VS ROLDAN ...........................................................................75
DISTAJO VS CA ................................................................................................75
CUI VS CUI.......................................................................................................78
VALENCIA VS CABANTING ...............................................................................95
DIRECTOR OF LANDS VS ABABA .....................................................................101
CONJUGAL PART. OF SPS. CADAVEDO VS LACAYA..........................................109
PENA VS DELOS SANTOS................................................................................119
DAROY VS ABECIA .........................................................................................120
RAMOS VS NGASEO ......................................................................................126
GAN TIANGCO VS PABINGUIT ........................................................................129
MACARIOLA VS ASUNCION............................................................................133
AKANG VS MUNICIPALITY OF ISULAN ............................................................147
March 1979[5] was executed through petitioners machinations and with
CONSENT malicious intent, to enable her to secure the corresponding transfer
certificate of title (TCT No. 172334[6]) in petitioners name alone.[7]
LABAGALA VS SANTIAGO
Respondents insisted that the deed of sale was a forgery. The deed
This petition for review on certiorari seeks to annul the decision dated showed that Jose affixed his thumbmark thereon but respondents averred
March 4, 1997,[1] of the Court of Appeals in CA-G.R. CV No. 32817, which that, having been able to graduate from college, Jose never put his
reversed and set aside the judgment dated October 17, 1990,[2] of the thumbmark on documents he executed but always signed his name in
Regional Trial Court of Manila, Branch 54, in Civil Case No. 87-41515, full. They claimed that Jose could not have sold the property belonging to
finding herein petitioner to be the owner of 1/3 pro indiviso share in a his poor and unschooled sisters who sacrificed for his studies and personal
parcel of land. welfare.[8] Respondents also pointed out that it is highly improbable for
petitioner to have paid the supposed consideration of P150,000 for the
sale of the subject property because petitioner was unemployed and
The pertinent facts of the case, as borne by the records, are as follows: without any visible means of livelihood at the time of the alleged sale.
They also stressed that it was quite unusual and questionable that
petitioner registered the deed of sale only on January 26, 1987, or almost
Jose T. Santiago owned a parcel of land covered by TCT No. 64729, eight years after the execution of the sale.[9]
located in Rizal Avenue Extension, Sta. Cruz, Manila. Alleging that Jose
had fraudulently registered it in his name alone, his sisters Nicolasa and
Amanda (now respondents herein), sued Jose for recovery of 2/3 share On the other hand, petitioner claimed that her true name is not Ida C.
of the property.[3] On April 20, 1981, the trial court in that case decided Labagala as claimed by respondent but Ida C. Santiago. She claimed not
in favor of the sisters, recognizing their right of ownership over portions to know any person by the name of Ida C. Labagala. She claimed to be
of the property covered by TCT No. 64729. The Register of Deeds of the daughter of Jose and thus entitled to his share in the subject property.
Manila was required to include the names of Nicolasa and Amanda in the She maintained that she had always stayed on the property, ever since
certificate of title to said property.[4] she was a child. She argued that the purported sale of the property was
in fact a donation to her, and that nothing could have precluded Jose from
putting his thumbmark on the deed of sale instead of his signature. She
Jose died intestate on February 6, 1984. On August 5, 1987, respondents pointed out that during his lifetime, Jose never acknowledged
filed a complaint for recovery of title, ownership, and possession against respondents claim over the property such that respondents had to sue to
herein petitioner, Ida C. Labagala, before the Regional Trial Court of claim portions thereof. She lamented that respondents had to disclaim
Manila, to recover from her the 1/3 portion of said property pertaining to her in their desire to obtain ownership of the whole property.
Jose but which came into petitioners sole possession upon Joses death.
Hence, the present petition wherein the following issues are raised for
consideration:
According to the trial court, while there was indeed no consideration for
the deed of sale executed by Jose in favor of petitioner, said deed
1. Whether or not petitioner has adduced preponderant evidence to prove 1/3 portion of the property he co-owned with respondents, through
that she is the daughter of the late Jose T. Santiago, and succession, sale, or donation.
2. Whether or not respondents could still impugn the filiation of the On the first issue, we find petitioners reliance on Article 263 of the Civil
petitioner as the daughter of the late Jose T. Santiago. Code to be misplaced. Said article provides:
Petitioner contends that the trial court was correct in ruling that she had Art. 263. The action to impugn the legitimacy of the child shall be brought
adduced sufficient evidence to prove her filiation by Jose Santiago, within one year from the recording of the birth in the Civil Register, if the
making her his sole heir and thus entitled to inherit his 1/3 portion. She husband should be in the same place, or in a proper case, any of his heirs.
points out that respondents had, before the filing of the instant case,
previously considered[11] her as the daughter of Jose who, during his
lifetime, openly regarded her as his legitimate daughter. She asserts that If he or his heirs are absent, the period shall be eighteen months if they
her identification as Joses daughter in his ITR outweighs the strange should reside in the Philippines; and two years if abroad. If the birth of
answers he gave when he testified in Civil Case No. 56226. the child has been concealed, the term shall be counted from the
discovery of the fraud.
Clearly, there is no valid sale in this case. Jose did not have the right to
transfer ownership of the entire property to petitioner since 2/3 thereof
Thus, we are constrained to agree with the factual finding of the Court of
belonged to his sisters.[28] Petitioner could not have given her consent
Appeals that petitioner is in reality the child of Leon Labagala and Cornelia
to the contract, being a minor at the time.[29] Consent of the contracting
Cabrigas, and contrary to her averment, not of Jose Santiago and
parties is among the essential requisites of a contract,[30] including one
Esperanza Cabrigas. Not being a child of Jose, it follows that petitioner
of sale, absent which there can be no valid contract. Moreover, petitioner
can not inherit from him through intestate succession. It now remains to
admittedly did not pay any centavo for the property,[31] which makes
be seen whether the property in dispute was validly transferred to
the sale void. Article 1471 of the Civil Code provides:
petitioner through sale or donation.
Art. 1471. If the price is simulated, the sale is void, but the act may be
On the validity of the purported deed of sale, however, we agree with the
shown to have been in reality a donation, or some other act or contract.
Court of Appeals that:
Neither may the purported deed of sale be a valid deed of donation. Again,
This deed is shot through and through with so many intrinsic defects that
as explained by the Court of Appeals:
a reasonable mind is inevitably led to the conclusion that it is fake. The
intrinsic defects are extractable from the following questions: a) If Jose
Santiago intended to donate the properties in question to Ida, what was
Even assuming that the deed is genuine, it cannot be a valid donation. It
lacks the acceptance of the donee required by Art. 725 of the Civil Code.
Being a minor in 1979, the acceptance of the donation should have been
made by her father, Leon Labagala or [her] mother Cornelia Cabrigas or
her legal representative pursuant to Art. 741 of the same Code. No one
of those mentioned in the law - in fact no one at all - accepted the
donation for Ida.[32]
SO ORDERED.
FRANCISCO VS HERRERA since 1973. He likewise claimed that the first parcel, the lot covered by
TD No. 01-00495, was subject to the co-ownership of the surviving heirs
This is a petition for review on certiorari of the decision[1] of the Court of of Francisca A. Herrera, the wife of Eligio, Sr., considering that she died
Appeals, dated August 30, 1999, in CA-G.R. CV No. 47869, which affirmed intestate on April 2, 1990, before the alleged sale to petitioner. Finally,
in toto the judgment[2] of the Regional Trial Court (RTC) of Antipolo City, respondent also alleged that the sale of the two lots was null and void on
Branch 73, in Civil Case No. 92-2267. The appellate court sustained the the ground that at the time of sale, Eligio, Sr. was already incapacitated
trial courts ruling which: (a) declared null and void the deeds of sale of to give consent to a contract because he was already afflicted with senile
the properties covered by Tax Declaration Nos. 01-00495 and 01-00497; dementia, characterized by deteriorating mental and physical condition
and (b) directed petitioner to return the subject properties to respondent including loss of memory.
who, in turn, must refund to petitioner the purchase price of P1,750,000.
Eligio Herrera, Sr., the father of respondent, was the owner of two parcels
of land, one consisting of 500 sq. m. and another consisting of 451 sq. On November 14, 1994, the Regional Trial Court handed down its
m., covered by Tax Declaration (TD) Nos. 01-00495 and 01-00497, decision, the dispositive portion of which reads:
respectively. Both were located at Barangay San Andres, Cainta, Rizal.[3]
WHEREFORE, in view of all the foregoing, this court hereby orders that:
On January 3, 1991, petitioner bought from said landowner the first
parcel, covered by TD No. 01-00495, for the price of P1,000,000, paid in
installments from November 30, 1990 to August 10, 1991.
1. The deeds of sale of the properties covered by Tax Dec. Nos. 01-00495
and 01-00497 are declared null and void;
SO ORDERED.[4] III. THE COURT OF APPEALS WAS IN GROSS ERROR AND IN FACT
VIOLATED PETITIONERS RIGHT TO DUE PROCESS WHEN IT RULED THAT
THE CONSIDERATION FOR THE QUESTIONED CONTRACTS WAS
Petitioner then elevated the matter to the Court of Appeals in CA-G.R. CV GROSSLY INADEQUATE.[6]
No. 47869. On August 30, 1999, however, the appellate court affirmed
the decision of the Regional Trial Court, thus:
The resolution of this case hinges on one pivotal issue: Are the assailed
contracts of sale void or merely voidable and hence capable of being
WHEREFORE, premises considered, the decision appealed from is hereby ratified?
AFFIRMED in toto. Costs against defendant-appellant.
Petitioner contends that the Court of Appeals erred when it ignored the
SO ORDERED.[5] basic distinction between void and voidable contracts. He argues that the
contracts of sale in the instant case, following Article 1390[7] of the Civil
Code are merely voidable and not void ab initio. Hence, said contracts
can be ratified. Petitioner argues that while it is true that a demented
Hence, this petition for review anchored on the following grounds:
person cannot give consent to a contract pursuant to Article 1327,[8]
nonetheless the dementia affecting one of the parties will not make the
contract void per se but merely voidable. Hence, when respondent
I. THE COURT OF APPEALS COMPLETELY IGNORED THE BASIC accepted the purchase price on behalf of his father who was allegedly
DIFFERENCE BETWEEN A VOID AND A MERELY VOIDABLE CONTRACT suffering from senile dementia, respondent effectively ratified the
THUS MISSING THE ESSENTIAL SIGNIFICANCE OF THE ESTABLISHED contracts. The ratified contracts then become valid and enforceable as
FACT OF RATIFICATION BY THE RESPONDENT WHICH EXTINGUISHED between the parties.
WHATEVER BASIS RESPONDENT MAY HAVE HAD IN HAVING THE
CONTRACT AT BENCH ANNULLED.
Respondent counters that his act of receiving the purchase price does not
imply ratification on his part. He only received the installment payments
II. THE DECISION OF THE COURT OF APPEALS ON SENILE DEMENTIA: on his senile fathers behalf, since the latter could no longer account for
the previous payments. His act was thus meant merely as a safety
measure to prevent the money from going into the wrong hands.
A. DISREGARDED THE FACTUAL BACKGROUND OF THE CASE; Respondent also maintains that the sales of the two properties were null
and void. First, with respect to the lot covered by TD No. 01-00497, Eligio,
Sr. could no longer sell the same because it had been previously sold to
B. WAS CONTRARY TO ESTABLISHED JURISPRUDENCE; AND respondent in 1973. As to lot covered by TD No. 01-00495, respondent
contends that it is co-owned by Eligio, Sr. and his children, as heirs of
Eligios wife. As such, Eligio, Sr. could not sell said lot without the consent contracts that are valid and binding unless annulled through a proper
of his co-owners. action filed in court seasonably.
We note that both the trial court and the Court of Appeals found that An annullable contract may be rendered perfectly valid by ratification,
Eligio, Sr. was already suffering from senile dementia at the time he sold which can be express or implied. Implied ratification may take the form
the lots in question. In other words, he was already mentally of accepting and retaining the benefits of a contract.[13] This is what
incapacitated when he entered into the contracts of sale. Settled is the happened in this case. Respondents contention that he merely received
rule that findings of fact of the trial court, when affirmed by the appellate payments on behalf of his father merely to avoid their misuse and that
court, are binding and conclusive upon the Supreme Court.[9] he did not intend to concur with the contracts is unconvincing. If he was
not agreeable with the contracts, he could have prevented petitioner from
delivering the payments, or if this was impossible, he could have
Coming now to the pivotal issue in this controversy. A void or inexistent immediately instituted the action for reconveyance and have the
contract is one which has no force and effect from the very beginning. payments consigned with the court. None of these happened. As found
Hence, it is as if it has never been entered into and cannot be validated by the trial court and the Court of Appeals, upon learning of the sale,
either by the passage of time or by ratification. There are two types of respondent negotiated for the increase of the purchase price while
void contracts: (1) those where one of the essential requisites of a valid receiving the installment payments. It was only when respondent failed
contract as provided for by Article 1318[10] of the Civil Code is totally to convince petitioner to increase the price that the former instituted the
wanting; and (2) those declared to be so under Article 1409[11] of the complaint for reconveyance of the properties. Clearly, respondent was
Civil Code. By contrast, a voidable or annullable contract is one in which agreeable to the contracts, only he wanted to get more. Further, there is
the essential requisites for validity under Article 1318 are present, but no showing that respondent returned the payments or made an offer to
vitiated by want of capacity, error, violence, intimidation, undue do so. This bolsters the view that indeed there was ratification. One
influence, or deceit. cannot negotiate for an increase in the price in one breath and in the
same breath contend that the contract of sale is void.
Article 1318 of the Civil Code states that no contract exists unless there
is a concurrence of consent of the parties, object certain as subject Nor can we find for respondents argument that the contracts were void
matter, and cause of the obligation established. Article 1327 provides that as Eligio, Sr., could not sell the lots in question as one of the properties
insane or demented persons cannot give consent to a contract. But, if an had already been sold to him, while the other was the subject of a co-
insane or demented person does enter into a contract, the legal effect is ownership among the heirs of the deceased wife of Eligio, Sr. Note that it
that the contract is voidable or annullable as specifically provided in was found by both the trial court and the Court of Appeals that Eligio, Sr.,
Article 1390.[12] was the declared owner of said lots. This finding is conclusive on us. As
declared owner of said parcels of land, it follows that Eligio, Sr., had the
right to transfer the ownership thereof under the principle of jus
disponendi.
In the present case, it was established that the vendor Eligio, Sr. entered
into an agreement with petitioner, but that the formers capacity to
consent was vitiated by senile dementia. Hence, we must rule that the
assailed contracts are not void or inexistent per se; rather, these are In sum, the appellate court erred in sustaining the judgment of the trial
court that the deeds of sale of the two lots in question were null and void.
WHEREFORE, the instant petition is GRANTED. The decision dated August
30, 1999 of the Court of Appeals in CA-G.R. CV No. 47869, affirming the
decision of the Regional Trial Court in Civil Case No. 92-2267 is
REVERSED. The two contracts of sale covering lots under TD No. 01-
00495 and No. 01-00497 are hereby declared VALID. Costs against
respondent.
SO ORDERED.
PARAGAS VS HEIRS OF DOMINADOR BALACANO and witnessed by Antonio Agcaoili (Antonio) and Julia Garabiles (Julia).
Gregorios certificates of title over Lots 1175-E and 1175-F were
This petition for review seeks to annul the Decision[1] dated 15 February consequently cancelled and new certificates of title were issued in favor
2005 of the Court of Appeals in CA-G.R. CV No. 64048, affirming with of the Spouses Paragas.
modification the 8 March 1999 Decision[2] of the Regional Trial Court
(RTC), Branch 21, of Santiago City, Isabela, in Civil Case No. 21-2313.
The petition likewise seeks to annul the Resolution[3] dated 17 May 2005
The Spouses Paragas then sold on October 17, 1996 a portion of Lot
denying petitioners motion for reconsideration.
1175-E consisting of 6,416 square meters to Catalino for the total
consideration of P60,000.00.
The lower court denied the motion to dismiss, but directed the plaintiffs- Additionally, the plaintiffs-appellees presented in evidence Gregorios
appellees to amend the complaint to include Alfredo as a party. Alfredo medical records and his death certificate.
was subsequently declared as in default for his failure to file his Answer
to the Complaint.
Defendants-appellees, on the other hand, presented as witnesses Notary
Public de Guzman and instrumental witness Antonio to prove Gregorios
The defendants-appellees filed their Answer with Counterclaim on May 7, execution of the sale and the circumstances under the deed was
1997, denying the material allegations of the complaint. Additionally, they executed. They uniformly declared that: (1) on July 18, 1996, they went
claimed that: (1) the deed of sale was actually executed by Gregorio on to the hospital in Bayombong, Nueva Vizcaya where Gregorio was
July 19 (or 18), 1996 and not July 22, 1996; (2) the Notary Public confined with Rudy; (2) Atty. De Guzman read and explained the contents
personally went to the Hospital in Bayombong, Nueva Vizcaya on July 18, of the deed to Gregorio; (3) Gregorio signed the deed after receiving the
1996 to notarize the deed of sale already subject of a previously money from Rudy; (4) Julia and Antonio signed the deed as witnesses.
concluded covenant between Gregorio and the Spouses Paragas; (3) at Additionally, Atty. De Guzman explained that the execution of the deed
the time Gregorio signed the deed, he was strong and of sound and was merely a confirmation of a previous agreement between the Spouses
disposing mind; (4) Lots 1175-E and 1175-F were Gregorios separate Paragas and Gregorio that was concluded at least a month prior to
capital and the inscription of Lorenzas name in the titles was just a Gregorios death; that, in fact, Gregorio had previously asked him to
description of Gregorios marital status; (5) the entire area of Lots 1175- prepare a deed that Gregorio eventually signed on July 18, 1996. He also
E and 1175-F were sold to the Spouses Paragas. They interposed a explained that the deed, which appeared to have been executed on July
counterclaim for damages. 22, 1996, was actually executed on July 18, 1996; he notarized the deed
and entered it in his register only on July 22, 1996. He claimed that he
did not find it necessary to state the precise date and place of execution
At the trial, the parties proceeded to prove their respective contentions. (Bayombong, Nueva Vizcaya, instead of Santiago City) of the deed of sale
because the deed is merely a confirmation of a previously agreed contract
between Gregorio and the Spouses Paragas. He likewise stated that of
the stated P500,000.00 consideration in the deed, Rudy paid Gregorio
Plaintiff-appellant Nanette Balacano testified to prove the material
P450,000.00 in the hospital because Rudy had previously paid Gregorio
allegations of their complaint. On Gregorios medical condition, she
P50,000.00. For his part, Antonio added that he was asked by Rudy to
declared that: (1) Gregorio, who was then 81 years old, weak and sick,
take pictures of Gregorio signing the deed. He also claimed that there was
was brought to the hospital in Bayombong, Nueva Vizcaya on June 28,
no entry on the date when he signed; nor did he remember reading
1996 and stayed there until the afternoon on July 19, 1996; (2)
Santiago City as the place of execution of the deed. He described Gregorio
thereafter, Gregorio, who by then was weak and could no longer talk and
as still strong but sickly, who got up from the bed with Julias help.
whose condition had worsened, was transferred in the afternoon of July
The lower court found the explanations of Atty. De Guzman regarding the
erroneous entries on the actual place and date of execution of the deed
Witness for defendants-appellants Luisa Agsalda testified to prove that
of sale as justifications for a lie. The lower court said
Lot 1175-E was Gregorios separate property. She claimed that Gregorios
father (Leon) purchased a two-hectare lot from them in 1972 while the
other lot was purchased from her neighbor. She also declared that
The Court cannot imagine an attorney to undertake to travel to another
Gregorio inherited these lands from his father Leon; she does not know,
province to notarize a document when he must certainly know, being a
however, Gregorios brothers share in the inheritance. Defendant-
lawyer and by all means, not stupid, that he has no authority to notarize
appellant Catalino also testified to corroborate the testimony of witness
a document in that province. The only logical thing that happened was
Luisa Agsalda; he said that Gregorio told him that he (Gregorio) inherited
Lots 1175-E and 1175-F from his father Leon. He also stated that a that Rudy Paragas brought the deed of sale to him on July 22, 1996
already signed and requested him to notarize the same which he did, not
portion of Lot 1175-E consisting of 6,416 square meters was sold to him
by the Spouses Paragas and that he will pay the Spouses Paragas knowing that at that time the vendor was already in a hospital and [sic]
Quezon City. Of course had he known, Atty. De Guzman would not have
P50,000.00, not as consideration for the return of the land but for the
notarized the document. But he trusted Rudy Paragas and moreover,
transfer of the title to his name.
Gregorio Balacano already informed him previously in June that he will
sell his lands to Paragas. In addition [sic, (,) was omitted] Rudy Paragas
also told him that Balacano received an advance of P50,000.00.
Additionally, the defendants-appellants presented in evidence the
pictures taken by Antonio when Gregorio allegedly signed the deed.[4]
The intention to sell is not actual selling. From the first week of June
when, according to Atty. De Guzman, Gregorio Balacano informed him
The lower court, after trial, rendered the decision declaring null and void
that he will sell his land to Rudy Paragas, enough time elapsed to the time
the deed of sale purportedly executed by Gregorio Balacano in favor of he was brought to the hospital on June 28, 1996. Had there been a
the spouses Rudy Paragas and Corazon Paragas. In nullifying the deed of
meeting of the minds between Gregorio Balacano and Rudy Paragas
sale executed by Gregorio, the lower court initially noted that at the time
regarding the sale, surely Gregorio Balacano would have immediately
Gregorio executed the deed, Gregorio was ill. The lower courts reasoning
returned to the office of Atty. De Guzman to execute the deed of sale. He
in declaring the deed of sale null and void and this reasonings premises
did not until he was brought to the hospital and diagnosed to have liver
may be summarized as follows: (1) the deed of sale was improperly
cirrhosis. Because of the seriousness of his illness, it is not expected that
notarized; thus it cannot be considered a public document that is usually Gregorio Balacano would be negotiating a contract of sale. Thus, Rudy
accorded the presumption of regularity; (2) as a private document, the
Paragas negotiated with Catalino Balacano, the son of Gregorio Balacano
deed of sales due execution must be proved in accordance with Section
with whom the latter was staying.[6]
20, Rule 132 of the Revised Rules on Evidence either: (a) by anyone who
saw the document executed or written; or (b) by evidence of the
genuineness of the signature or handwriting of the maker; and (3) it was
The lower court also did not consider Antonio Agcaoili, petitioner Rudy
incumbent upon the Spouses Paragas to prove the deed of sales due
Paragass driver, a convincing witness, concluding that he was telling a
execution but failed to do so the lower court said that witness Antonio
Agcaoili is not credible while Atty. Alexander De Guzman is not reliable.[5] rehearsed story. The lower court said
The only portion of his testimony that is true is that he signed the
document. How could the Court believe that he brought a camera with
WHEREFORE in the light of the foregoing considerations judgment is
him just to take pictures of the signing? If the purpose was to record the
hereby rendered:
proceeding for posterity, why did he not take the picture of Atty. De
Guzman when the latter was reading and explaining the document to
Gregorio Balacano? Why did he not take the picture of both Gregorio
Balacano and Atty. de Guzman while the old man was signing the 1. DECLARING as NULL and VOID the deed of sale purportedly executed
document instead of taking a picture of Gregorio Balacano alone holding by Gregorio Balacano in favor of the spouses Rudy Paragas and Corazon
a ball pen without even showing the document being signed? Verily there Paragas over lots 1175-E and 1175-F covered by TCT Nos. T-103297 and
is a picture of a document but only a hand with a ball pen is shown with T-103298, respectively;
it. Why? Clearly the driver Antonio Agcaoili must have only been asked
by Rudy Paragas to tell a concocted story which he himself would not dare
tell in Court under oath.[7] 2. ORDERING the cancellation of TCT Nos. T-258042 and T-258041 issued
in the name of the spouses Rudy and Corazon Paragas by virtue of the
deed of sale; and
The lower court likewise noted that petitioner Rudy Paragas did not testify
about the signing of the deed of sale. To the lower court, Rudys refusal
or failure to testify raises a lot of questions, such as: (1) was he (Rudy) DECLARING the parcel of lands, lots 1175-E and 1175-F as part of the
afraid to divulge the circumstances of how he obtained the signature of estate of the deceased spouses Gregorio Balacano and Lorenza
Gregorio Balacano, and (2) was he (Rudy) afraid to admit that he did not Balacano.[11]
actually pay the P500,000.00 indicated in the deed of sale as the price of
the land?[8]
In the assailed Decision dated 15 February 2005, the Court of Appeals
affirmed the Decision of the trial court, with the modification that Lots
The lower court also ruled that Lots 1175-E and 1175-F were Gregorios 1175-E and 1175-F were adjudged as belonging to the estate of Gregorio
and Lorenzas conjugal partnership properties. The lower court found that Balacano. The appellate court disposed as follows:
these lots were acquired during the marriage because the certificates of
title of these lots clearly stated that the lots are registered in the name
Gregorio, married to Lorenza Sumigcay. Thus, the lower court concluded WHEREFORE, premises considered, the appeal is hereby DISMISSED. We
that the presumption of law (under Article 160 of the Civil Code of the AFFIRM the appealed Decision for the reasons discussed above, with the
Philippines) that property acquired during the marriage is presumed to MODIFICATION that Lots 1175-E and 1175-F belong to the estate of
belong to the conjugal partnership fully applies to Lots 1175-E and 1175- Gregorio Balacano.
F.[9]
Let a copy of this Decision be furnished the Office of the Bar Confidant for
Thus, on 8 March 1999, the RTC, Branch 21, of Santiago City, Isabela, whatever action her Office may take against Atty. De Guzman.[12]
rendered a Decision[10] in Civil Case No. 21-2313, the dispositive portion (Emphasis in the original.)
of which reads as follows:
Herein petitioners motion for reconsideration was met with similar lack of At bottom is the issue of whether or not the Court of Appeals committed
success when it was denied for lack of merit by the Court of Appeals in reversible error in upholding the findings and conclusions of the trial court
its Resolution[13] dated 17 May 2005. on the nullity of the Deed of Sale purportedly executed between
petitioners and the late Gregorio Balacano.
Hence, this appeal via a petition for review where petitioners assign the
following errors to the Court of Appeals, viz: To start, we held in Blanco v. Quasha[15] that this Court is not a trier of
facts. As such, it is not its function to examine and determine the weight
of the evidence supporting the assailed decision. Factual findings of the
A. THE HONORABLE COURT OF APPEALS, WITH GRAVE ABUSE OF Court of Appeals, which are supported by substantial evidence, are
DISCRETION, SERIOUSLY ERRED IN FINDING THAT THERE WAS NO binding, final and conclusive upon the Supreme Court,[16] and carry even
PERFECTED AND PARTIALLY EXECUTED CONTRACT OF SALE OVER LOTS more weight when the said court affirms the factual findings of the trial
1175-E AND 1175-F PRIOR TO THE SIGNING OF THE DEED OF SALE. court. Moreover, well- entrenched is the prevailing jurisprudence that
only errors of law and not of facts are reviewable by this Court in a petition
for review on certiorari under Rule 45 of the Revised Rules of Court.
B. THE HONORABLE COURT OF APPEALS, WITH GRAVE ABUSE OF
DISCRETION, SERIOUSLY FAILED TO APPRECIATE THE SIGNIFICANCE OF
THE JUDICIAL ADMISSION ON THE AUTHENTICITY AND DUE EXECUTION The foregoing tenets in the case at bar apply with greater force to the
OF THE DEED OF SALE MADE BY THE RESPONDENTS DURING THE PRE- petition under consideration because the factual findings by the Court of
TRIAL CONFERENCE. Appeals are in full agreement with that of the trial court.
C. THE HONORABLE COURT OF APPEALS, WITH GRAVE ABUSE OF Specifically, the Court of Appeals, in affirming the trial court, found that
DISCRETION, BASED ITS CONCLUSION THAT GREGORIOS CONSENT TO there was no prior and perfected contract of sale that remained to be fully
THE SALE OF THE LOTS WAS ABSENT MERELY ON SPECULATIONS AND consummated. The appellate court explained -
SURMISES.
In the case at bar, the Deed of Sale was allegedly signed by Gregorio on
his death bed in the hospital. Gregorio was an octogenarian at the time
of the alleged execution of the contract and suffering from liver cirrhosis
at that circumstances which raise grave doubts on his physical and mental
capacity to freely consent to the contract. Adding to the dubiety of the
purported sale and further bolstering respondents claim that their uncle
Catalino, one of the children of the decedent, had a hand in the execution
of the deed is the fact that on 17 October 1996, petitioners sold a portion
of Lot 1175-E consisting of 6,416 square meters to Catalino for
P60,000.00.[22] One need not stretch his imagination to surmise that
Catalino was in cahoots with petitioners in maneuvering the alleged sale.
SO ORDERED.
HEIRS OF REYES VS MIJARES
Under the regime of the Civil Code, the alienation or encumbrance of a On August 9, 1984, Ignacia, through her counsel, sent a letter to
conjugal real property requires the consent of the wife. The absence of respondent spouses demanding the return of her ½ share in the lot.
such consent renders the entire transaction1 merely voidable and not Failing to settle the matter amicably, Ignacia filed on June 4, 1996 a
void.2 The wife may, during the marriage and within ten years from the complaint15 for annulment of sale against respondent spouses. The
transaction questioned, bring an action for the annulment of the contract complaint was thereafter amended to include Vicente Reyes as one of the
entered into by her husband without her consent.3 defendants.16
Assailed in this petition for review on certiorari are the January 26, 2000 In their answer, respondent spouses claimed that they are purchasers in
Decision4 and June 19, 2000, Resolution5 of the Court of Appeals in CA- good faith and that the sale was valid because it was duly approved by
G.R. No. 28464 which declared respondents as purchasers in good faith the court.17 Vicente Reyes, on the other hand, contended that what he
and set aside the May 31, 1990 and June 29, 1990 Orders of the Regional sold to the spouses was only his share in Lot No. 4349-B-2, excluding the
Trial Court of Quezon City, Branch 101, in Civil Case No. Q-48018. share of his wife, and that he never represented that the latter was
already dead.18 He likewise testified that respondent spouses, through
the counsel they provided him, took advantage of his illiteracy by filing a
The controversy stemmed from a dispute over Lot No. 4349-B-2,6 petition for the issuance of letters of administration and appointment of
approximately 396 square meters, previously covered by Transfer guardian without his knowledge.19
Certificate of Title (TCT) No. 205445, located in Balintawak, Quezon City
and registered in the name of Spouses Vicente Reyes and Ignacia Aguilar-
Reyes.7 Said lot and the apartments built thereon were part of the On February 15, 1990, the court a quo rendered a decision declaring the
spouses’ conjugal properties having been purchased using conjugal funds sale of Lot No. 4349-B-2 void with respect to the share of Ignacia. It held
from their garments business.8 that the purchase price of the lot was P110,000.00 and ordered Vicente
to return ½ thereof or P55,000.00 to respondent spouses. The dispositive
portion of the said decision, reads-
Vicente and Ignacia were married in 1960, but had been separated de
facto since 1974.9 Sometime in 1984, Ignacia learned that on March 1,
1983, Vicente sold Lot No. 4349-B-2 to respondent spouses Cipriano and WHEREFORE, premises above considered, judgment is hereby rendered
Florentina Mijares for P40,000.00.10 As a consequence thereof, TCT No. declaring the subject Deed of Absolute Sale, dated March [1,] 1983 signed
205445 was cancelled and TCT No. 306087 was issued on April 19, 1983 by and between defendants Vicente Reyes and defendant Cipriano Mijares
in the name of respondent spouses.11 She likewise found out that Vicente NULL AND VOID WITH RESPECT TO ONE-HALF (1/2) OF THE SAID
filed a petition for administration and appointment of guardian with the PROPERTY;
Metropolitan Trial Court of Quezon City, Branch XXI. Vicente
misrepresented therein that his wife, Ignacia, died on March 22, 1982,
and that he and their 5 minor children were her only heirs.12 On The Register of Deeds of Quezon City is hereby ordered to cancel TCT No.
September 29, 1983, the court appointed Vicente as the guardian of their 306083 (sic) in the names of defendant spouses Cipriano Mijares and
minor children.13 Subsequently, in its Order dated October 14, 1983, the Florentina Mijares and to issue a new TCT in the name of the plaintiff
court authorized Vicente to sell the estate of Ignacia.14 Ignacia Aguilar-Reyes as owner in fee simple of one-half (1/2) of said
property and the other half in the names of defendant spouses Cipriano by and between defendants Vicente Reyes and defendant Cipriano Mijares
Mijares and Florentin[a] Mijares, upon payment of the required fees as null and void ab initio, in view of the absence of the wife’s conformity
therefore; to said transaction.
Said defendant spouses Mijares are also ordered to allow plaintiff the use Consequent thereto, the Register of Deeds for Quezon City is hereby
and exercise of rights, as well as obligations, pertinent to her one-half ordered to cancel TCT No. 306083 (sic) in the name of Cipriano Mijares
(1/2) ownership of the subject property; and Florentin[a] Mijares and issue a new TCT in the name of the plaintiff
and defendant Ignacia Aguilar-Reyes and Vicente Reyes as owners in fee
simple, upon payment of required fees therefore.
Defendant Vicente Reyes is hereby ordered to reimburse P55,000.00 with
legal rate of interest from the execution of the subject Deed of Absolute
Sale on March 1, 1983, to the defendant spouses Cipriano Mijares and Defendant Vicente Reyes is hereby ordered to pay the amount of one
Florentina Mijares which corresponds to the one-half (1/2) of the actual hundred ten thousand pesos (P110,000.00) with legal rate of interest at
purchase price by the said Mijares but is annulled in this decision (sic); 12% per annum from the execution of the subject Deed of Absolute Sale
on March 1, 1983.
SO ORDERED.20
SO ORDERED.21
Ignacia filed a motion for modification of the decision praying that the
sale be declared void in its entirety and that the respondents be ordered On motion22 of Ignacia, the court issued an Order dated June 29, 1990
to reimburse to her the rentals they collected on the apartments built on amending the dispositive portion of the May 31, 1990 decision by
Lot No. 4349-B-2 computed from March 1, 1983.1âwphi1 correcting the Transfer Certificate of Title of Lot No. 4349-B-2, in the
name of Cipriano Mijares and Florentina Mijares, from TCT No. 306083 to
TCT No. 306087; and directing the Register of Deeds of Quezon City to
On May 31, 1990, the trial court modified its decision by declaring the issue a new title in the name of Ignacia Aguilar-Reyes and Vicente Reyes.
sale void in its entirety and ordering Vicente Reyes to reimburse The Order likewise specified that Vicente Reyes should pay Ignacia
respondent spouses the purchase price of P110,000, thus – Aguilar-Reyes the amount of P50,000.00 as moral and exemplary
damages.23
Articles 166 and 173 of the Civil Code,29 the governing laws at the time
WHEREFORE, premises considered, the Decision appealed from and the
the assailed sale was contracted, provide:
Orders dated May 31, 1990 and June 29, 1990, are SET ASIDE and in lieu
thereof a new one is rendered –
Art.166. Unless the wife has been declared a non compos mentis or a
1. Declaring the Deed of Absolute Sale dated March 1, 1983 executed by spendthrift, or is under civil interdiction or is confined in a leprosarium,
the husband cannot alienate or encumber any real property of the
Vicente Reyes in favor of spouses Cipriano and [Florentina] Mijares valid
and lawful; conjugal partnership without the wife’s consent. If she refuses
unreasonably to give her consent, the court may compel her to grant the
same…
SO ORDERED.27 Pursuant to the foregoing provisions, the husband could not alienate or
encumber any conjugal real property without the consent, express or
implied, of the wife otherwise, the contract is voidable. Indeed, in several defraud her or impair her interest in the conjugal partnership property.
cases30 the Court had ruled that such alienation or encumbrance by the Should the wife fail to exercise this right, she or her heirs after the
husband is void. The better view, however, is to consider the transaction dissolution of the marriage, may demand the value of property
as merely voidable and not void.31 This is consistent with Article 173 of fraudulently alienated by the husband.
the Civil Code pursuant to which the wife could, during the marriage and
within 10 years from the questioned transaction, seek its annulment.32
This particular provision giving the wife ten (10) years x x x during [the]
marriage to annul the alienation or encumbrance was not carried over to
In the case of Heirs of Christina Ayuste v. Court of Appeals,33 it was the Family Code. It is thus clear that any alienation or encumbrance made
categorically held that – after August 3, 1988 when the Family Code took effect by the husband of
the conjugal partnership property without the consent of the wife is null
and void…
There is no ambiguity in the wording of the law. A sale of real property of
the conjugal partnership made by the husband without the consent of his
wife is voidable. The action for annulment must be brought during the In the case at bar, there is no dispute that Lot No. 4349-B-2, is a conjugal
marriage and within ten years from the questioned transaction by the property having been purchased using the conjugal funds of the spouses
wife. Where the law speaks in clear and categorical language, there is no during the subsistence of their marriage. It is beyond cavil therefore that
room for interpretation — there is room only for application.34 the sale of said lot to respondent spouses without the knowledge and
consent of Ignacia is voidable. Her action to annul the March 1, 1983 sale
which was filed on June 4, 1986, before her demise is perfectly within the
Likewise, in Spouses Guiang v. Court of Appeals,35 the Court quoted with 10 year prescriptive period under Article 173 of the Civil Code. Even if we
approval the ruling of the trial court that under the Civil Code, the reckon the period from November 25, 1978 which was the date when
encumbrance or alienation of a conjugal real property by the husband Vicente and the respondent spouses entered into a contract concerning
absent the wife’s consent, is voidable and not void. Thus – Lot No. 4349-B-2, Ignacia’s action would still be within the prescribed
period.
…Under Article 166 of the Civil Code, the husband cannot generally
alienate or encumber any real property of the conjugal partnership Anent the second issue, the trial court correctly annulled the voidable sale
without the wife’s consent. The alienation or encumbrance if so made of Lot No. 4349-B-2 in its entirety. In Bucoy v. Paulino,36 a case involving
however is not null and void. It is merely voidable. The offended wife may the annulment of sale with assumption of mortgages executed by the
bring an action to annul the said alienation or encumbrance. Thus, the husband without the consent of the wife, it was held that the alienation
provision of Article 173 of the Civil Code of the Philippines, to wit: or encumbrance must be annulled in its entirety and not only insofar as
the share of the wife in the conjugal property is concerned. Although the
transaction in the said case was declared void and not merely voidable,
the rationale for the annulment of the whole transaction is the same thus
Art. 173. The wife may, during the marriage and within ten years from
–
the transaction questioned, ask the courts for the annulment of any
contract of the husband entered into without her consent, when such
consent is required, or any act or contract of the husband which tends to
The plain meaning attached to the plain language of the law is that the his eyes to facts which should put a reasonable man on his guard and still
contract, in its entirety, executed by the husband without the wife's claim he acted in good faith.38
consent, may be annulled by the wife. Had Congress intended to limit
such annulment in so far as the contract shall "prejudice" the wife, such
limitation should have been spelled out in the statute. It is not the In the instant case, there existed circumstances that should have placed
legitimate concern of this Court to recast the law. As Mr. Justice Jose B. respondent spouses on guard. The death certificate of Ignacia, shows that
L. Reyes of this Court and Judge Ricardo C. Puno of the Court of First she died on March 22, 1982. The same death certificate, however, reveals
Instance correctly stated, "[t]he rule (in the first sentence of Article 173) that – (1) it was issued by the Office of the Civil Registrar of Lubao
revokes Baello vs. Villanueva, 54 Phil. 213 and Coque vs. Navas Sioca, Pampanga on March 10, 1982; (2) the alleged death of Ignacia was
45 Phil. 430," in which cases annulment was held to refer only to the reported to the Office of the Civil Registrar on March 4, 1982; and (3) her
extent of the one-half interest of the wife… burial or cremation would be on March 8, 1982.39 These obvious flaws in
the death certificate should have prompted respondents to investigate
further, especially so that respondent Florentina Mijares admitted on
The necessity to strike down the contract of July 5, 1963 as a whole, not cross examination that she asked for the death certificate of Ignacia
merely as to the share of the wife, is not without its basis in the common- because she was suspicious that Ignacia was still alive.40 Moreover,
sense rule. To be underscored here is that upon the provisions of Articles respondent spouses had all the opportunity to verify the claim of Vicente
161, 162 and 163 of the Civil Code, the conjugal partnership is liable for that he is a widower because it was their lawyer, Atty. Rodriguito S. Saet,
many obligations while the conjugal partnership exists. Not only that. The who represented Vicente in the special proceedings before the
conjugal property is even subject to the payment of debts contracted by Metropolitan Trial Court.
either spouse before the marriage, as those for the payment of fines and
indemnities imposed upon them after the responsibilities in Article 161
have been covered (Article 163, par. 3), if it turns out that the spouse Neither can respondent spouses rely on the alleged court approval of the
who is bound thereby, "should have no exclusive property or if it should sale. Note that the Order issued by the Metropolitan Trial Court of Quezon
be insufficient." These are considerations that go beyond the mere City, Branch XXXI, appointing Vicente as guardian of his 5 minor children,
equitable share of the wife in the property. These are reasons enough for as well as the Order authorizing him to sell the estate of Ignacia were
the husband to be stopped from disposing of the conjugal property issued only on September 29, 1983 and October 14, 1983, respectively.
without the consent of the wife. Even more fundamental is the fact that On the other hand, the sale of the entire Lot No. 4349-B-2 to respondent
the nullity is decreed by the Code not on the basis of prejudice but lack spouses appears to have been made not on March 1, 1983, but even as
of consent of an indispensable party to the contract under Article 166.37 early as November 25, 1978. In the "Agreement" dated November 25,
1978, Vicente in consideration of the amount of P110,000.00, sold to
Cipriano Mijares Lot No. 4349-B-2 on installment basis, with the first
With respect to the third issue, the Court finds that respondent spouses installment due on or before July 31, 1979.41 This was followed by a
are not purchasers in good faith. A purchaser in good faith is one who "Memorandum of Understanding" executed on July 30, 1979, by Vicente
buys property of another, without notice that some other person has a and Cipriano – (1) acknowledging Cipriano’s receipt of Vicente’s down
right to, or interest in, such property and pays full and fair price for the payment in the amount of P50,000.00; and (2) authorizing Florentina
same, at the time of such purchase, or before he has notice of the claim Mijares to collect rentals.42 On July 14, 1981, Vicente and Cipriano
or interest of some other persons in the property. He buys the property executed another "Memorandum of Agreement," stating, among other,
with the belief that the person from whom he receives the thing was the that out of the purchase price of P110,000.00 Vicente had remaining
owner and could convey title to the property. A purchaser cannot close balance of P19,000.00.43 Clearly therefore, the special proceedings
before the Metropolitan Trial Court of Quezon City, Branch XXXI, could have paid as purchase price of Lot No. 4349-B-2.45 The court a quo
not have been the basis of respondent spouses’ claim of good faith correctly found that the subject of the sale was the entire Lot No. 4349-
because the sale of Lot No. 4349-B-2 occurred prior thereto. B-2 and that the consideration thereof is not P40,000.00 as stated in the
March 1, 1983 deed of sale, but P110,000.00 as evidenced by the – (1)
"Agreement" dated November 25, 1978 as well as the July 30, 1979
Respondent spouses cannot deny knowledge that at the time of the sale "Memorandum of Understanding" and the July 14, 1981 "Memorandum
in 1978, Vicente was married to Ignacia and that the latter did not give of Agreement" which served as receipts of the installment payments
her conformity to the sale. This is so because the 1978 "Agreement" made by respondent Cipriano Mijares; and (2) the receipt duly signed by
described Vicente as "married" but the conformity of his wife to the sale Vicente Reyes acknowledging receipt of the amount of P110,000.00 from
did not appear in the deed. Obviously, the execution of another deed of respondent spouses as payment of the sale of the controverted lot.46
sale in 1983 over the same Lot No. 4349-B-2, after the alleged death of
Ignacia on March 22, 1982, as well as the institution of the special
proceedings were, intended to correct the absence of Ignacia’s consent The trial court, however, erred in imposing 12% interest per annum on
to the sale. Even assuming that respondent spouses believed in good faith the amount due the respondents. In Eastern Shipping Lines, Inc. v. Court
that Ignacia really died on March 22, 1982, after they purchased the lot, of Appeals,47 it was held that interest on obligations not constituting a
the fact remains that the sale of Lot No. 4349-B-2 prior to Ignacia’s loan or forbearance of money is six percent (6%) annually. If the
alleged demise was without her consent and therefore subject to purchase price could be established with certainty at the time of the filing
annulment. The October 14, 1983 order authorizing the sale of the estate of the complaint, the six percent (6%) interest should be computed from
of Ignacia, could not have validated the sale of Lot No. 4349-B-2 because the date the complaint was filed until finality of the decision. In Lui v.
said order was issued on the assumption that Ignacia was already dead Loy,48 involving a suit for reconveyance and annulment of title filed by
and that the sale dated March 1, 1983 was never categorically approved the first buyer against the seller and the second buyer, the Court, ruling
in the said order. in favor of the first buyer and annulling the second sale, ordered the seller
to refund to the second buyer (who was not a purchaser in good faith)
the purchase price of the lots. It was held therein that the 6% interest
The fact that the 5 minor children44 of Vicente represented by the latter, should be computed from the date of the filing of the complaint by the
signed the March 1, 1983 deed of sale of Lot No. 4349-B-2 will not estop first buyer. After the judgment becomes final and executory until the
them from assailing the validity thereof. Not only were they too young at obligation is satisfied, the amount due shall earn interest at 12% per year,
that time to understand the repercussions of the sale, they likewise had the interim period being deemed equivalent to a forbearance of credit.49
no right to sell the property of their mother who, when they signed the
deed, was very much alive.
Accordingly, the amount of P110,000.00 due the respondent spouses
which could be determined with certainty at the time of the filing of the
If a voidable contract is annulled, the restoration of what has been given complaint shall earn 6% interest per annum from June 4, 1986 until the
is proper. The relationship between parties in any contract even if finality of this decision. If the adjudged principal and the interest (or any
subsequently annulled must always be characterized and punctuated by part thereof) remain unpaid thereafter, the interest rate shall be twelve
good faith and fair dealing. Hence, for the sake of justice and equity, and percent (12%) per annum computed from the time the judgment
in consonance with the salutary principle of non-enrichment at another’s becomes final and executory until it is fully satisfied.
expense, the Court sustains the trial court’s order directing Vicente to
refund to respondent spouses the amount of P110,000.00 which they
Petitioner’s prayer for payment of rentals should be denied. Other than WHEREFORE, in view of all the foregoing, the petition is PARTIALLY
the allegation of Ignacia in her Sinumpaang Salaysay that the apartments GRANTED. The January 26, 2000 Decision and June 19, 2002, Resolution
could be rented at P1,000.00 a month, no other evidence was presented of the Court of Appeals in CA-G.R. No. 28464 are REVERSED and SET
to substantiate her claim. In awarding rentals which are in the nature of ASIDE. The May 31, 1990 Order of the Regional Trial Court of Quezon
actual damages, the Court cannot rely on mere assertions, speculations, City, Branch 101, in Civil Case No. Q-48018, which annulled the March 1,
conjectures or guesswork but must depend on competent proof and on 1983 Deed of Absolute Sale over Lot No. 4349-B-2, and ordered the
the best evidence obtainable regarding the actual amount of loss.50 Register of Deeds of Quezon City to cancel TCT No. 306087 in the name
None, having been presented in the case at bar, petitioner’s claim for of respondent spouses Cipriano Mijares and Florentina Mijares covering
rentals must be denied. the same property; as well as the June 29, 1990 Order correcting the
typographical errors in the order dated March 1, 1983, are REINSTATED,
with the following modifications –
While as a general rule, a party who has not appealed is not entitled to
affirmative relief other than the ones granted in the decision of the court
below, law and jurisprudence authorize a tribunal to consider errors, (1) The Register of Deeds of Quezon City is ordered to issue a new
although unassigned, if they involve (1) errors affecting the lower court’s certificate of title over Lot No. 4349-B-2, in the name of petitioners as co-
jurisdiction over the subject matter, (2) plain errors not specified, and (3) owners thereof;
clerical errors.51 In this case, though defendant Vicente Reyes did not
appeal, the "plain error" committed by the court a quo as to the award of
moral and exemplary damages must be corrected. These awards cannot (2) Vicente Reyes is ordered to reimburse the respondent spouses the
be lumped together as was done by the trial court.52 Moral and amount of P110,000.00 as purchase price of Lot No. 4349-B-2, with
exemplary damages are different in nature, and require separate interest at 6% per annum from June 4, 1986, until finality of this decision.
determination. Moral damages are awarded where the claimant After this decision becomes final, interest at the rate of 12% per annum
experienced physical suffering, mental anguish, fright, serious anxiety, on the principal and interest (or any part thereof) shall be imposed until
besmirched reputation, wounded feelings, moral shock, social full payment.
humiliation, and similar injury as a result of the act complained of.53 The
award of exemplary damages, on the other hand, is warranted when
moral, temperate, liquidated, or compensatory damages were likewise
(3) Defendant Vicente Reyes is ordered to pay the heirs of the late Ignacia
awarded by the court.54
Aguilar-Reyes, the amounts of P25,000.00 as moral damages and
P25,000.00 as exemplary damages.
The facts of this case are simple. Over the objection of private respondent
and while she was in Manila seeking employment, her husband sold to 3. Plaintiff Gilda Corpuz left for Manila sometime in June 1989. She was
the petitioners-spouses one half of their conjugal property, consisting of trying to look for work abroad, in [the] Middle East. Unfortunately, she
their residence and the lot on which it stood. The circumstances of this became a victim of an unscrupulous illegal recruiter. She was not able to
sale are set forth in the Decision of Respondent Court, which quoted from go abroad. She stayed for sometime in Manila however, coming back to
the Decision of the trial court, as follows:[8] Koronadal, South Cotabato, x x x on March 11, 1990. Plaintiffs departure
for Manila to look for work in the Middle East was with the consent of her
husband Judie Corpuz (tsn. p. 16, Aug.12, 1990; p. 10, Sept. 6, 1991).
1. Plaintiff Gilda Corpuz and defendant Judie Corpuz are legally married
spouses. They were married on December 24, 1968 in Bacolod City,
before a judge. This is admitted by defendants-spouses Antonio and After his wifes departure for Manila, defendant Judie Corpuz seldom went
Luzviminda Guiang in their answer, and also admitted by defendant Judie home to the conjugal dwelling. He stayed most of the time at his place of
Corpuz when he testified in court (tsn. p..3, June 9, 1992), although the work at Samahang Nayon Building, a hotel, restaurant, and a cooperative.
latter says that they were married in 1967. The couple have three Daughter Harriet Corpuz went to school at Kings College, Bo. 1,
children, namely: Junie 18 years old, Harriet 17 years of age, and Jodie Koronadal, South Cotabato, but she was at the same time working as
or Joji, the youngest, who was 15 years of age in August, 1990 when her household help of, and staying at, the house of Mr. Panes. Her brother
mother testified in court. Junie was not working. Her younger sister Jodie (Joji) was going to school.
Her mother sometimes sent them money (tsn. p. 14, Sept. 6, 1991).
Sometime on February 14, 1983, the couple Gilda and Judie Corpuz, with
plaintiff-wife Gilda Corpuz as vendee, bought a 421 sq. meter lot located Sometime in January 1990, Harriet Corpuz learned that her father
in Barangay Gen. Paulino Santos (Bo. 1), Koronadal, South Cotabato, and intended to sell the remaining one-half portion including their house, of
particularly known as Lot 9, Block 8, (LRC) Psd-165409 from Manuel their homelot to defendants Guiangs. She wrote a letter to her mother
Callejo who signed as vendor through a conditional deed of sale for a total informing her. She [Gilda Corpuz] replied that she was objecting to the
consideration of P14,735.00. The consideration was payable in sale. Harriet, however, did not inform her father about this; but instead
installment, with right of cancellation in favor of vendor should vendee gave the letter to Mrs. Luzviminda Guiang so that she [Guiang] would
fail to pay three successive installments (Exh. 2, tsn. p. 6, February 14, advise her father (tsn. pp. 16-17, Sept. 6, 1991).
1990).
III
Ruling of Respondent Court
Respondent Court found no reversible error in the trial courts ruling that Whether or not the Court of Appeals erred in not setting aside the findings
of the Court a quo which recognized as lawful and valid the ownership
any alienation or encumbrance by the husband of the conjugal property
without the consent of his wife is null and void as provided under Article and possession of private respondent over the remaining one half (1/2)
124 of the Family Code. It also rejected petitioners contention that the portion of the subject property.
amicable settlement ratified said sale, citing Article 1409 of the Code
which expressly bars ratification of the contracts specified therein,
particularly those prohibited or declared void by law. In a nutshell, petitioners-spouses contend that (1) the contract of sale
(Deed of Transfer of Rights) was merely voidable, and (2) such contract
was ratified by private respondent when she entered into an amicable
Hence, this petition.[9] settlement with them.
II
ART. 1390. The following contracts are voidable or annullable, even
though there may have been no damage to the contracting parties:
A That was on March 11, 1990, Maam.
xxxxxxxxx
Q Now, when you arrived at Koronadal, was there any problem which
arose concerning the ownership of your residential house at Callejo
Subdivision?
(2) Those where the consent is vitiated by mistake, violence, intimidation,
undue influence or fraud.
This being the case, said contract properly falls within the ambit of Article
The error in petitioners contention is evident. Article 1390, par. 2, refers 124 of the Family Code, which was correctly applied by the two lower
to contracts visited by vices of consent, i.e., contracts which were entered
courts:
into by a person whose consent was obtained and vitiated through
mistake, violence, intimidation, undue influence or fraud. In this instance,
private respondents consent to the contract of sale of their conjugal
property was totally inexistent or absent. Gilda Corpuz, on direct ART. 124. The administration and enjoyment of the conjugal partnership
property shall belong to both spouses jointly. In case of disagreement,
examination, testified thus:[11]
the husbands decision shall prevail, subject to recourse to the court by
the wife for proper remedy, which must be availed of within five years
from the date of the contract implementing such decision.
Q Now, on March 1, 1990, could you still recall where you were?
Art. 173. The wife may, during the marriage and within ten years from Insisting that the contract of sale was merely voidable, petitioners aver
the transaction questioned, ask the courts for the annulment of any that it was duly ratified by the contending parties through the amicable
settlement they executed on March 16, 1990 in Barangay Case No. 38.
contract of the husband entered into without her consent, when such
consent is required, or any act or contract of the husband which tends to
defraud her or impair her interest in the conjugal partnership property.
Should the wife fail to exercise this right, she or her heirs after the The position is not well taken. The trial and the appellate courts have
dissolution of the marriage, may demand the value of property resolved this issue in favor of the private respondent. The trial court
fraudulently alienated by the husband.(n) correctly held:[15]
This particular provision giving the wife ten (10) years x x x during [the] By the specific provision of the law [Art. 1390, Civil Code] therefore, the
marriage to annul the alienation or encumbrance was not carried over to Deed of Transfer of Rights (Exh. A) cannot be ratified, even by an
the Family Code. It is thus clear that any alienation or encumbrance made amicable settlement. The participation by some barangay authorities in
after August 3, 1988 when the Family Code took effect by the husband of the amicable settlement cannot otherwise validate an invalid act.
the conjugal partnership property without the consent of the wife is null Moreover, it cannot be denied that the amicable settlement (Exh. B)
and void. entered into by plaintiff Gilda Corpuz and defendant spouses Guiang is a
contract. It is a direct offshoot of the Deed of Transfer of Rights (Exh. A).
By express provision of law, such a contract is also void. Thus, the legal
Furthermore, it must be noted that the fraud and the intimidation referred provision, to wit:
to by petitioners were perpetrated in the execution of the document
embodying the amicable settlement. Gilda Corpuz alleged during trial that
Art. 1422. A contract which is the direct result of a previous illegal
contract, is also void and inexistent. (Civil Code of the Philippines).
WHEREFORE, the Court hereby DENIES the petition and AFFIRMS the
challenged Decision and Resolution. Costs against petitioners.
SO ORDERED.
AINZA VS SPS. PADUA Thereafter, Antonio requested Natividad to vacate the premises but the
latter refused and claimed that Concepcion owned the property. Antonio
This petition for review on certiorari assails the February 24, 2004 thus filed an ejectment suit on April 1, 1999. Concepcion, represented by
decision of the Court of Appeals in CA-G.R. CV No. 70239,[1] and its Natividad, also filed on May 4, 1999 a civil case for partition of real
September 28, 2004 resolution, denying reconsideration thereof.[2] property and annulment of titles with damages.
In her complaint for partition of real property, annulment of titles with Antonio claimed that his wife, Eugenia, admitted that Concepcion offered
damages,[3] Concepcion Ainza (Concepcion) alleged that respondent- to buy one third (1/3) of the property who gave her small amounts over
spouses Eugenia (Eugenia) and Antonio Padua (Antonio) owned a 216.40 several years which totaled P100,000.00 by 1987 and for which she
sq. m. lot with an unfinished residential house located at No. 85-A Durian signed a receipt.
corner Pajo Sts., Barangay Quirino 2-C, Project 2, Quezon City, covered
by Transfer Certificate of Title No. 271935. Sometime in April 1987, she
bought one-half of an undivided portion of the property from her
On January 9, 2001, the Regional Trial Court of Quezon City, Branch 85,
daughter, Eugenia and the latters husband, Antonio, for One Hundred
rendered judgment[4] in favor of Concepcion, the dispositive portion of
Thousand Pesos (P100,000.00).
which states:
On the other hand, Antonio averred that he bought the property in 1980
and introduced improvements thereon. Between 1989 and 1990, he and 3. the defendants to pay to the plaintiff P50,000.00 as attorneys fees.
his wife, Eugenia, allowed Natividad and Ceferino to occupy the premises
temporarily. In 1994, they caused the subdivision of the property and
three (3) separate titles were issued. SO ORDERED.[5]
The trial court upheld the sale between Eugenia and Concepcion. It ruled Received the amount of ONE HUNDRED THOUSAND PESOS
that the sale was consummated when both contracting parties complied (P100,000.00) as payment for the lot on 85-A Durian St., Project 2,
with their respective obligations. Eugenia transferred possession by Quezon City, from Mrs. Concepcion R. Ainza, on April, 1987.
delivering the property to Concepcion who in turn paid the purchase price.
It also declared that the transfer of the property did not violate the
Statute of Frauds because a fully executed contract does not fall within _______(Sgd.)______
its coverage.
Gimenas contract is not rescissible for in such a contract all the essential
It is useful at this point to re-state some elementary rules: The husband
elements are untainted but Gimenas consent was tainted. Neither can the
is the administrator of the conjugal partnership. (Art. 165, Civil Code) contract be classified as unenforceable because it does not fit any of those
Subject to certain exceptions, the husband cannot alienate or encumber described in Art. 1403 of the Civil Code. And finally, the contract cannot
any real property of the conjugal partnership without the wifes consent.
be void or inexistent because it is not one of those mentioned in Art. 1409
(Art. 166, Idem.) And the wife cannot bind the conjugal partnership
of the Civil Code. By process of elimination, it must perforce be a voidable
without the husbands consent, except in cases provided by law. (Art. 172,
contract.
Idem.).
Even assuming that the ten (10)-year prescriptive period under Art. 173
should apply, Antonio is still barred from instituting an action to annul the
sale because since April 1987, more than ten (10) years had already
lapsed without any such action being filed.
In sum, the sale of the conjugal property by Eugenia without the consent
of her husband is voidable. It is binding unless annulled. Antonio failed to
exercise his right to ask for the annulment within the prescribed period,
hence, he is now barred from questioning the validity of the sale between
his wife and Concepcion.
SO ORDERED.
SPS. FUENTES VS ROCA six months, Tarciano was to clear the lot of structures and occupants and
secure the consent of his estranged wife, Rosario Gabriel Roca (Rosario),
This case is about a husbands sale of conjugal real property, employing to the sale. Upon Tarcianos compliance with these conditions, the Fuentes
a challenged affidavit of consent from an estranged wife. The buyers claim spouses were to take possession of the lot and pay him an additional
valid consent, loss of right to declare nullity of sale, and prescription. P140,000.00 or P160,000.00, depending on whether or not he succeeded
in demolishing the house standing on it. If Tarciano was unable to comply
with these conditions, the Fuentes spouses would become owners of the
lot without any further formality and payment.
The parties left their signed agreement with Atty. Plagata who then
worked on the other requirements of the sale. According to the lawyer,
he went to see Rosario in one of his trips to Manila and had her sign an
Sabina Tarroza owned a titled 358-square meter lot in Canelar, affidavit of consent.[3] As soon as Tarciano met the other conditions,
Zamboanga City. On October 11, 1982 she sold it to her son, Tarciano T. Atty. Plagata notarized Rosarios affidavit in Zamboanga City. On January
Roca (Tarciano) under a deed of absolute sale.[1] But Tarciano did not 11, 1989 Tarciano executed a deed of absolute sale[4] in favor of the
for the meantime have the registered title transferred to his name. Fuentes spouses. They then paid him the additional P140,000.00
mentioned in their agreement. A new title was issued in the name of the
spouses[5] who immediately constructed a building on the lot. On January
28, 1990 Tarciano passed away, followed by his wife Rosario who died
nine months afterwards.
Six years later in 1988, Tarciano offered to sell the lot to petitioners
Manuel and Leticia Fuentes (the Fuentes spouses). They arranged to meet
at the office of Atty. Romulo D. Plagata whom they asked to prepare the
documents of sale. They later signed an agreement to sell that Atty.
Plagata prepared[2] dated April 29, 1988, which agreement expressly Eight years later in 1997, the children of Tarciano and Rosario, namely,
stated that it was to take effect in six months. respondents Conrado G. Roca, Annabelle R. Joson, and Rose Marie R.
Cristobal, together with Tarcianos sister, Pilar R. Malcampo, represented
by her son, John Paul M. Trinidad (collectively, the Rocas), filed an action
for annulment of sale and reconveyance of the land against the Fuentes
spouses before the Regional Trial Court (RTC) of Zamboanga City in Civil
Case 4707. The Rocas claimed that the sale to the spouses was void since
Tarcianos wife, Rosario, did not give her consent to it. Her signature on
The agreement required the Fuentes spouses to pay Tarciano a down
the affidavit of consent had been forged. They thus prayed that the
payment of P60,000.00 for the transfer of the lots title to him. And, within
property be reconveyed to them upon reimbursement of the price that
the Fuentes spouses paid Tarciano.[6]
Moreover, the Rocas failed to present clear and convincing evidence of
the fraud. Mere variance in the signatures of Rosario was not conclusive
proof of forgery.[10] The RTC ruled that, although the Rocas presented a
handwriting expert, the trial court could not be bound by his opinion since
the opposing expert witness contradicted the same. Atty. Plagatas
testimony remained technically unrebutted.[11]
The spouses denied the Rocas allegations. They presented Atty. Plagata
who testified that he personally saw Rosario sign the affidavit at her
residence in Paco, Manila, on September 15, 1988. He admitted,
however, that he notarized the document in Zamboanga City four months
later on January 11, 1989.[7] All the same, the Fuentes spouses pointed
out that the claim of forgery was personal to Rosario and she alone could
invoke it. Besides, the four-year prescriptive period for nullifying the sale Finally, the RTC noted that Atty. Plagatas defective notarization of the
on ground of fraud had already lapsed. affidavit of consent did not invalidate the sale. The law does not require
spousal consent to be on the deed of sale to be valid. Neither does the
irregularity vitiate Rosarios consent. She personally signed the affidavit
in the presence of Atty. Plagata.[12]
Both the Rocas and the Fuentes spouses presented handwriting experts
at the trial. Comparing Rosarios standard signature on the affidavit with
those on various documents she signed, the Rocas expert testified that
On appeal, the Court of Appeals (CA) reversed the RTC decision. The CA
the signatures were not written by the same person. Making the same
found sufficient evidence of forgery and did not give credence to Atty.
comparison, the spouses expert concluded that they were.[8]
Plagatas testimony that he saw Rosario sign the document in Quezon City.
Its jurat said differently. Also, upon comparing the questioned signature
with the specimen signatures, the CA noted significant variance between
them. That Tarciano and Rosario had been living separately for 30 years
On February 1, 2005 the RTC rendered judgment, dismissing the case. It since 1958 also reinforced the conclusion that her signature had been
ruled that the action had already prescribed since the ground cited by the forged.
Rocas for annulling the sale, forgery or fraud, already prescribed under
Article 1391 of the Civil Code four years after its discovery. In this case,
the Rocas may be deemed to have notice of the fraud from the date the
deed of sale was registered with the Registry of Deeds and the new title
was issued. Here, the Rocas filed their action in 1997, almost nine years
after the title was issued to the Fuentes spouses on January 18, 1989.[9] Since Tarciano and Rosario were married in 1950, the CA concluded that
their property relations were governed by the Civil Code under which an
action for annulment of sale on the ground of lack of spousal consent may
be brought by the wife during the marriage within 10 years from the
transaction. Consequently, the action that the Rocas, her heirs, brought
1. Whether or not Rosarios signature on the document of consent to her
in 1997 fell within 10 years of the January 11, 1989 sale.
husband Tarcianos sale of their conjugal land to the Fuentes spouses was
forged;
Considering, however, that the sale between the Fuentes spouses and
Tarciano was merely voidable, the CA held that its annulment entitled the
2. Whether or not the Rocas action for the declaration of nullity of that
spouses to reimbursement of what they paid him plus legal interest
computed from the filing of the complaint until actual payment. Since the sale to the spouses already prescribed; and
Fuentes spouses were also builders in good faith, they were entitled under
Article 448 of the Civil Code to payment of the value of the improvements
they introduced on the lot. The CA did not award damages in favor of the
Rocas and deleted the award of attorneys fees to the Fuentes
spouses.[13]
3. Whether or not only Rosario, the wife whose consent was not had,
could bring the action to annul that sale.
Unsatisfied with the CA decision, the Fuentes spouses came to this court
by petition for review.[14]
The Courts Rulings
First. The key issue in this case is whether or not Rosarios signature on
the document of consent had been forged. For, if the signature were
genuine, the fact that she gave her consent to her husbands sale of the
conjugal land would render the other issues merely academic.
The case presents the following issues:
What is more, Atty. Plagata admittedly falsified the jurat of the affidavit
of consent. That jurat declared that Rosario swore to the document and
The CA found that Rosarios signature had been forged. The CA observed
signed it in Zamboanga City on January 11, 1989 when, as Atty. Plagata
a marked difference between her signature on the affidavit of consent[15]
testified, she supposedly signed it about four months earlier at her
and her specimen signatures.[16] The CA gave no weight to Atty.
residence in Paco, Manila on September 15, 1988. While a defective
Plagatas testimony that he saw Rosario sign the document in Manila on notarization will merely strip the document of its public character and
September 15, 1988 since this clashed with his declaration in the jurat reduce it to a private instrument, that falsified jurat, taken together with
that Rosario signed the affidavit in Zamboanga City on January 11, 1989.
the marks of forgery in the signature, dooms such document as proof of
Rosarios consent to the sale of the land. That the Fuentes spouses
honestly relied on the notarized affidavit as proof of Rosarios consent
does not matter. The sale is still void without an authentic consent.
The Court agrees with the CAs observation that Rosarios signature
strokes on the affidavit appears heavy, deliberate, and forced. Her
specimen signatures, on the other hand, are consistently of a lighter
stroke and more fluid. The way the letters R and s were written is also
Second. Contrary to the ruling of the Court of Appeals, the law that
remarkably different. The variance is obvious even to the untrained eye.
applies to this case is the Family Code, not the Civil Code. Although
Tarciano and Rosario got married in 1950, Tarciano sold the conjugal
property to the Fuentes spouses on January 11, 1989, a few months after
the Family Code took effect on August 3, 1988.
But, as already stated, the Family Code took effect on August 3, 1988.
Art. 124. x x x In the event that one spouse is incapacitated or otherwise
Its Chapter 4 on Conjugal Partnership of Gains expressly superseded Title
unable to participate in the administration of the conjugal properties, the
VI, Book I of the Civil Code on Property Relations Between Husband and
Wife.[18] Further, the Family Code provisions were also made to apply to other spouse may assume sole powers of administration. These powers
already existing conjugal partnerships without prejudice to vested do not include the powers of disposition or encumbrance which must have
the authority of the court or the written consent of the other spouse. In
rights.[19] Thus:
the absence of such authority or consent, the disposition or encumbrance
shall be void. x x x
Art. 105. x x x The provisions of this Chapter shall also apply to conjugal
partnerships of gains already established between spouses before the
Under the provisions of the Civil Code governing contracts, a void or
effectivity of this Code, without prejudice to vested rights already
inexistent contract has no force and effect from the very beginning. And
acquired in accordance with the Civil Code or other laws, as provided in
Article 256. (n) this rule applies to contracts that are declared void by positive provision
of law,[20] as in the case of a sale of conjugal property without the other
spouses written consent. A void contract is equivalent to nothing and is
absolutely wanting in civil effects. It cannot be validated either by
ratification or prescription.[21]
The Fuentes spouses of course argue that the RTC nullified the sale to
them based on fraud and that, therefore, the applicable prescriptive
But, although a void contract has no legal effects even if no action is taken
period should be that which applies to fraudulent transactions, namely,
to set it aside, when any of its terms have been performed, an action to
four years from its discovery. Since notice of the sale may be deemed
declare its inexistence is necessary to allow restitution of what has been
given to the Rocas when it was registered with the Registry of Deeds in
given under it.[22] This action, according to Article 1410 of the Civil Code 1989, their right of action already prescribed in 1993.
does not prescribe. Thus:
But, if there had been a victim of fraud in this case, it would be the
Art. 1410. The action or defense for the declaration of the inexistence of
Fuentes spouses in that they appeared to have agreed to buy the property
a contract does not prescribe. upon an honest belief that Rosarios written consent to the sale was
genuine. They had four years then from the time they learned that her
signature had been forged within which to file an action to annul the sale
and get back their money plus damages. They never exercised the right.
Here, the Rocas filed an action against the Fuentes spouses in 1997 for
annulment of sale and reconveyance of the real property that Tarciano
sold without their mothers (his wifes) written consent. The passage of
time did not erode the right to bring such an action. If, on the other hand, Rosario had agreed to sign the document of consent
upon a false representation that the property would go to their children,
not to strangers, and it turned out that this was not the case, then she
would have four years from the time she discovered the fraud within
which to file an action to declare the sale void. But that is not the case
here. Rosario was not a victim of fraud or misrepresentation. Her consent
Besides, even assuming that it is the Civil Code that applies to the was simply not obtained at all. She lost nothing since the sale without her
transaction as the CA held, Article 173 provides that the wife may bring written consent was void. Ultimately, the Rocas ground for annulment is
an action for annulment of sale on the ground of lack of spousal consent not forgery but the lack of written consent of their mother to the sale.
during the marriage within 10 years from the transaction. Consequently, The forgery is merely evidence of lack of consent.
the action that the Rocas, her heirs, brought in 1997 fell within 10 years
of the January 11, 1989 sale. It did not yet prescribe.
Third. The Fuentes spouses point out that it was to Rosario, whose presented some difficulty. Indeed, they willingly made a 30 percent down
consent was not obtained, that the law gave the right to bring an action payment on the selling price months earlier on the assurance that it was
to declare void her husbands sale of conjugal land. But here, Rosario died forthcoming.
in 1990, the year after the sale. Does this mean that the right to have
the sale declared void is forever lost?
1. The deed of sale dated January 11, 1989 that Tarciano T. Roca
executed in favor of Manuel O. Fuentes, married to Leticia L. Fuentes, as
well as the Transfer Certificate of Title T-90,981 that the Register of 5. The RTC of Zamboanga City from which this case originated is
Deeds of Zamboanga City issued in the names of the latter spouses DIRECTED to receive evidence and determine the amount of indemnity to
pursuant to that deed of sale are DECLARED void; which petitioner spouses Manuel and Leticia Fuentes are entitled
SO ORDERED.
SPS. AGGABAO VS SPS. PARULAN
On July 26, 2000, the Regional Trial Court (RTC), Branch 136, in Makati
City annulled the deed of absolute sale executed in favor of the petitioners
Involved in this action are two parcels of land and their improvements
covering two parcels of registered land the respondents owned for want
(property) located at No. 49 Miguel Cuaderno Street, Executive Village,
of the written consent of respondent husband Dionisio Parulan, Jr. On July
BF Homes, Paraaque City and registered under Transfer Certificate of Title
2, 2004, in C.A.-G.R. CV No. 69044,[1] the Court of Appeals (CA) affirmed
(TCT) No. 63376[2] and TCT No. 63377[3] in the name of respondents
the RTC decision.
Spouses Maria Elena A. Parulan (Ma. Elena) and Dionisio Z. Parulan, Jr.
(Dionisio), who have been estranged from one another.
Antecedents On February 4, 1991, the petitioners went to the Office of the Register of
Deeds and the Assessors Office of Paraaque City to verify the TCTs shown
by Ma. Elena in the company of Atanacio and her husband (also a licensed who was then in Hongkong.[12] She assured them that the owners
broker).[6] There, they discovered that the lot under TCT No. 63376 had duplicate copy of TCT No. 63376 would be turned over after a week.
been encumbered to Banco Filipino in 1983 or 1984, but that the
encumbrance had already been cancelled due to the full payment of the
obligation.[7] They noticed that the Banco Filipino loan had been effected
through an SPA executed by Dionisio in favor of Ma. Elena.[8] They found
on TCT No. 63377 the annotation of an existing mortgage in favor of the
Los Baos Rural Bank, also effected through an SPA executed by Dionisio
On March 19, 1991, TCT No. 63377 was cancelled and a new one was
in favor of Ma. Elena, coupled with a copy of a court order authorizing Ma.
issued in the name of the petitioners.
Elena to mortgage the lot to secure a loan of P500,000.00.[9]
Ma. Elena did not turn over the duplicate owners copy of TCT No. 63376
The petitioners and Atanacio next inquired about the mortgage and the
as promised. In due time, the petitioners learned that the duplicate
court order annotated on TCT No. 63377 at the Los Baos Rural Bank.
owners copy of TCT No. 63376 had been all along in the custody of Atty.
There, they met with Atty. Noel Zarate, the banks legal counsel, who
Jeremy Z. Parulan, who appeared to hold an SPA executed by his brother
related that the bank had asked for the court order because the lot
Dionisio authorizing him to sell both lots.[13]
involved was conjugal property.[10]
At Atanacios instance, the petitioners met on March 25, 1991 with Atty.
Following their verification, the petitioners delivered P130,000.00 as
Parulan at the Manila Peninsula.[14] For that meeting, they were
additional down payment on February 4, 1991; and P650,000.00 to the
accompanied by one Atty. Olandesca.[15] They recalled that Atty. Parulan
Los Baos Rural Bank on February 12, 1991, which then released the
smugly demanded P800,000.00 in exchange for the duplicate owners
owners duplicate copy of TCT No. 63377 to them.[11]
copy of TCT No. 63376, because Atty. Parulan represented the current
value of the property to be P1.5 million. As a counter-offer, however, they
tendered P250,000.00, which Atty. Parulan declined,[16] giving them
only until April 5, 1991 to decide.
1. The Deed of Absolute Sale dated March 18, 1991 covering the sale
of the lot located at No. 49 M. Cuaderno St., Executive Village, BF Homes,
In turn, the petitioners filed on July 12, 1991 their own action for specific Paraaque, Metro Manila, and covered by TCT Nos. 63376 and 63377 is
performance with damages against the respondents. declared null and void.
Both cases were consolidated for trial and judgment in the RTC.[18] 2. Defendant Mrs. Elena Parulan is directed to pay litigation expenses
amounting to P50,000.00 and the costs of the suit.
Issues
The RTC rejected the petitioners defense of being buyers in good faith
because of their failure to exercise ordinary prudence, including
demanding from Ma. Elena a court order authorizing her to sell the
properties similar to the order that the Los Baos Rural Bank had required The petitioners now make two arguments: (1) they were buyers in good
before accepting the mortgage of the property.[23] It observed that they faith; and (2) the CA erred in affirming the RTCs finding that the sale
had appeared to be in a hurry to consummate the transaction despite between Mrs. Elena and the petitioners had been a nullity under Article
Atanacios advice that they first consult a lawyer before buying the 124 of the Family Code.
property; that with ordinary prudence, they should first have obtained
the owners duplicate copies of the TCTs before paying the full amount of
the consideration; and that the sale was void pursuant to Article 124 of
the Family Code.[24]
The petitioners impute error to the CA for not applying the ordinary
prudent mans standard in determining their status as buyers in good
faith. They contend that the more appropriate law to apply was Article
173 of the Civil Code, not Article 124 of the Family Code; and that even
Ruling of the CA if the SPA held by Ma. Elena was a forgery, the ruling in Veloso v. Court
of Appeals[26] warranted a judgment in their favor.
Restated, the issues for consideration and resolution are as follows:
1.
1) Which between Article 173 of the Civil Code and Article 124 of the
Family Code should apply to the sale of the conjugal property executed
Article 124, Family Code, applies to sale of conjugal
without the consent of Dionisio?
The petitioners submit that Article 173 of the Civil Code, not Article 124
of the Family Code, governed the property relations of the respondents
because they had been married prior to the effectivity of the Family Code;
and that the second paragraph of Article 124 of the Family Code should
not apply because the other spouse held the administration over the
3) Might the ruling in Veloso v. Court of Appeals be applied in favor of the
conjugal property. They argue that notwithstanding his absence from the
petitioners despite the finding of forgery of the SPA?
country Dionisio still held the administration of the conjugal property by
virtue of his execution of the SPA in favor of his brother; and that even
assuming that Article 124 of the Family Code properly applied, Dionisio
ratified the sale through Atty. Parulans counter-offer during the March
25, 1991 meeting.
Ruling
Lastly, the petitioners insistence that Atty. Parulans making of a counter- but also agents authority to sell the property
offer during the March 25, 1991 meeting ratified the sale merits no
consideration. Under Article 124 of the Family Code, the transaction
executed sans the written consent of Dionisio or the proper court order
was void; hence, ratification did not occur, for a void contract could not
be ratified.[32]
A purchaser in good faith is one who buys the property of another, without
notice that some other person has a right to, or interest in, such property,
and pays the full and fair price for it at the time of such purchase or before
he has notice of the claim or interest of some other persons in the
property. He buys the property with the belief that the person from whom
On the other hand, we agree with Dionisio that the void sale was a he receives the thing was the owner and could convey title to the
continuing offer from the petitioners and Ma. Elena that Dionisio had the property. He cannot close his eyes to facts that should put a reasonable
option of accepting or rejecting before the offer was withdrawn by either man on his guard and still claim he acted in good faith.[33] The status of
or both Ma. Elena and the petitioners. The last sentence of the second a buyer in good faith is never presumed but must be proven by the person
paragraph of Article 124 of the Family Code makes this clear, stating that invoking it.[34]
in the absence of the other spouses consent, the transaction should be
construed as a continuing offer on the part of the consenting spouse and
the third person, and may be perfected as a binding contract upon the
acceptance by the other spouse or upon authorization by the court before
the offer is withdrawn by either or both offerors.
Here, the petitioners disagree with the CA for not applying the ordinary
prudent mans standard in determining their status as buyers in good
faith. They insist that they exercised due diligence by verifying the status
of the TCTs, as well as by inquiring about the details surrounding the It is true that a buyer of registered land needs only to show that he has
mortgage extended by the Los Baos Rural Bank. They lament the holding relied on the face of the certificate of title to the property, for he is not
of the CA that they should have been put on their guard when they required to explore beyond what the certificate indicates on its face.[37]
learned that the Los Baos Rural Bank had first required a court order In this respect, the petitioners sufficiently proved that they had checked
before granting the loan to the respondents secured by their mortgage of on the authenticity of TCT No. 63376 and TCT No. 63377 with the Office
the property. of the Register of Deeds in Pasay City as the custodian of the land records;
and that they had also gone to the Los Baos Rural Bank to inquire about
the mortgage annotated on TCT No. 63377. Thereby, the petitioners
observed the requisite diligence in examining the validity of the TCTs
concerned.
Yet, it ought to be plain enough to the petitioners that the issue was
whether or not they had diligently inquired into the authority of Ma. Elena
to convey the property, not whether or not the TCT had been valid and
Article 124 of the Family Code categorically requires the consent of both
authentic, as to which there was no doubt. Thus, we cannot side with
spouses before the conjugal property may be disposed of by sale,
them.
mortgage, or other modes of disposition. In Bautista v. Silva,[35] the
Court erected a standard to determine the good faith of the buyers
dealing with
a seller who had title to and possession of the land but whose capacity to
sell was restricted, in that the consent of the other spouse was required Firstly, the petitioners knew fully well that the law demanded the written
before the conveyance, declaring that in order to prove good faith in such consent of Dionisio to the sale, but yet they did not present evidence to
a situation, the buyers must show that they inquired not only into the title show that they had made inquiries into the circumstances behind the
of the seller but also into the sellers capacity to sell.[36] Thus, the buyers execution of the SPA purportedly executed by Dionisio in favor of Ma.
of conjugal property must observe two kinds of requisite diligence, Elena. Had they made the appropriate inquiries, and not simply accepted
namely: (a) the diligence in verifying the validity of the title covering the the SPA for what it represented on its face, they would have uncovered
property; and (b) the diligence in inquiring into the authority of the soon enough that the respondents had been estranged from each other
transacting spouse to sell conjugal property in behalf of the other spouse. and were under de facto separation, and that they probably held
conflicting interests that would negate the existence of an agency
between them. To lift this doubt, they must, of necessity, further inquire
into the SPA of Ma. Elena. The omission to inquire indicated their not
being buyers in good faith, for, as fittingly observed in Domingo v.
Reed:[38]
a week because her relative having custody of it had gone to Hongkong,
but their passivity in such an essential matter was puzzling light of their
earlier alacrity in immediately and diligently validating the TCTs to the
extent of inquiring at the Los Baos Rural Bank about the annotated
mortgage. Yet, they could have rightly withheld the final payment of the
What was required of them by the appellate court, which we affirm, was balance. That they did not do so reflected their lack of due care in dealing
merely to investigate as any prudent vendee should the authority of Lolita with Ma. Elena.
to sell the property and to bind the partnership. They had knowledge of
facts that should have led them to inquire and to investigate, in order to
acquaint themselves with possible defects in her title. The law requires
them to act with the diligence of a prudent person; in this case, their only
prudent course of action was to investigate whether respondent had
indeed given his consent to the sale and authorized his wife to sell the
Lastly, another reason rendered the petitioners good faith incredible.
property.[39]
They did not take immediate action against Ma. Elena upon discovering
that the owners original copy of TCT No. 63376 was in the possession of
Atty. Parulan, contrary to Elenas representation. Human experience
would have impelled them to exert every effort to proceed against Ma.
Elena, including demanding the return of the substantial amounts paid to
her. But they seemed not to mind her inability to produce the TCT, and,
Indeed, an unquestioning reliance by the petitioners on Ma. Elenas SPA instead, they contented themselves with meeting with Atty. Parulan to
without first taking precautions to verify its authenticity was not a prudent negotiate for the possible turnover of the TCT to them.
buyers move.[40] They should have done everything within their means
and power to ascertain whether the SPA had been genuine and authentic.
If they did not investigate on the relations of the respondents vis--vis
each other, they could have done other things towards the same end, like
attempting to locate the notary public who had notarized the SPA, or
checked with the RTC in Manila to confirm the authority of Notary Public
Atty. Datingaling. It turned out that Atty. Datingaling was not authorized 3.
to act as a Notary Public for Manila during the period 1990-1991, which
was a fact that they could easily discover with a modicum of zeal.
Veloso v. Court of Appeals cannot help petitioners
The fault of the petitioner in Veloso was that he did not adduce sufficient
evidence to prove that his signature and that of the notary public on the
SPA had been forged. The Court pointed out that his mere allegation that
the signatures had been forged could not be sustained without clear and
convincing proof to substantiate the allegation. Herein, however, both the
RTC and the CA found from the testimonies and evidence presented by
PELAYO VS PEREZ
This resolves the petition for review on certiorari seeking the reversal of
the Decision[1] of the Court of Appeals (CA) promulgated on April 20,
1999 which reversed the Decision of the Regional Trial Court (RTC) of
Panabo, Davao, Branch 34, in Civil Case No. 91-46; and the CA Resolution Perez thereupon asked Loreza to sign on the first and second pages of
dated December 17, 1999 denying petitioners motion for reconsideration. the deed but she refused, hence, he instituted on August 8, 1991 the
instant complaint for specific performance against her and her husband
Pelayo (defendants).
The questioned deed having been executed on January 10, 1988, the
defendants claimed that Perez had at least up to September 10, 1988
Loreza Pelayo (Loreza), wife of Pelayo, and another one whose signature within which to register the same, but as they failed to, it is not valid and,
is illegible witnessed the execution of the deed. therefore, unenforceable.
Loreza, however, signed only on the third page in the space provided for The trial court thus dismissed the complaint. On appeal to this Court, the
witnesses on account of which Perez application for registration of the dismissal was set aside and the case was remanded to the lower court for
deed with the Office of the Register of Deeds in Tagum, Davao was further proceedings.
denied.
the husband cannot alienate or encumber any real property of the
conjugal partnership without the wifes consent . . .
In their Answer, the defendants claimed that as the lots were occupied
illegally by some persons against whom they filed an ejectment case, they
and Perez who is their friend and known at the time as an activist/leftist,
hence feared by many, just made it appear in the deed that the lots were
sold to him in order to frighten said illegal occupants, with the intentional it is null and void.
omission of Lorezas signature so that the deed could not be registered;
and that the deed being simulated and bereft of consideration is
void/inexistent.
The trial court, finding, among others, that Perez did not possess, nor pay
the taxes on the lots, that defendant Pelayo was indebted to Perez for
services rendered and, therefore, the deed could only be considered as
Perez countered that the lots were given to him by defendant Pelayo in evidence of debt, and that in any event, there was no marital consent to
consideration of his services as his attorney-in-fact to make the necessary nor actual consideration for the deed, held that the deed was null and
representation and negotiation with the illegal occupants-defendants in void and accordingly rendered judgment the dispositive portion of which
the ejectment suit; and that after his relationship with defendant Pelayo reads:
became sour, the latter sent a letter to the Register of Deeds of Tagum
requesting him not to entertain any transaction concerning the lots title
to which was entrusted to Perez who misplaced and could [not] locate it.
The court further orders that the Deed of Absolute Sale, (Annex A) of the
complaint and (Annex C) of the plaintiffs Motion for Summary Judgment
is declared null and void and without force and it is likewise removed as
Hence, this petition for review on certiorari on the following grounds:
a cloud over defendants title and property in suit. . . .[2]
Petitioners moved for reconsideration of the decision but the same was
denied per Resolution dated December 17, 1999. The CA found said 3. The CA made a novel ruling that there was implied marital consent of
motion to have been filed out of time and ruled that even putting aside the wife of petitioner David Pelayo.
Respondent likewise opines that the CA was right in denying petitioners
motion for reconsideration where they prayed that they be allowed to file
4. Petitioners should have been allowed to file their appellees brief to their appellees brief as their counsel failed to file the same on account of
ventilate their side, considering the existence of peculiar circumstances
said counsels failing health due to cancer of the liver. Respondent
which prevented petitioners from filing said brief.
emphasized that in petitioners motion for reconsideration, they did not
even cite any errors made by the CA in its Decision.
On the other hand, respondent points out that the CA, in resolving the
first appeal docketed as CA-G.R. SP No. 38700[3] brought by respondent
The issues boil down to the question of whether or not the deed of sale
assailing the RTC Order granting herein petitioners motion to dismiss,
was null and void on the following grounds: (a) for not complying with
already ruled that under R.A. No. 6657, the sale or transfer of private
the provision in R.A. No. 6657 that such document must be registered
agricultural land is allowed only when the area of the land being conveyed
with the Register of Deeds within three months after the effectivity of said
constitutes or is a part of, the landowner-seller retained area and when
law; (b) for lack of marital consent; (c) for being prohibited under Article
the total landholding of the purchaser-transferee, including the property 1491 (2) of the Civil Code; and (d) for lack of consideration.
sold, does not exceed five (5) hectares; that in this case, the land in
dispute is only 1.3 hectares and there is no proof that the transferees
(herein respondent) total landholding inclusive of the subject land will
We rule against petitioners.
exceed 5 hectares, the landholding ceiling prescribed by R.A. No. 6657;
that the failure of respondent to register the instrument was not due to
his fault or negligence but can be attributed to Lorenzas unjustified refusal
to sign two pages of the deed despite several requests of respondent;
and that therefore, the CA ruled that the deed of sale subject of this case
is valid under R.A. No. 6657.
The issue of whether or not the deed of sale is null and void under R.A.
No. 6657, for respondents failure to register said document with the
Register of Deeds within three months after the effectivity of R.A. No.
6657, had been resolved with finality by the CA in its Decision dated
November 24, 1994 in CA-G.R. SP No. 38700.[4] Herein petitioners no
longer elevated said CA Decision to this Court and the same became final
Respondent further maintains that the CA correctly held in its assailed
and executory on January 7, 1995.[5]
Decision that there was consideration for the contract and that Lorenza is
deemed to have given her consent to the deed of sale.
In said decision, the CA interpreted Section 4, in relation to Section 70 of
R.A. No. 6657, to mean thus:
Law of the case has been defined as the opinion delivered on a former
appeal. It is a term applied to an established rule that when an appellate
court passes on a question and remands the case to the lower court for
further proceedings, the question there settled becomes the law of the
case upon subsequent appeal. It means that whatever is once irrevocably
established as the controlling legal rule or decision between the same
. . . the proper interpretation of both sections is that under R.A. No. 6657, parties in the same case continues to be the law of the case, whether
the sale or transfer of a private agricultural land is allowed only when said correct on general principles or not, so long as the facts on which such
land area constitutes or is a part of the landowner-seller retained area decision was predicated continue to be the facts of the case before the
and only when the total landholdings of the purchaser-transferee, court.
including the property sold does not exceed five (5) hectares.
Human experience tells us that a wife would surely be aware of serious Moreover, under Article 173, in relation to Article 166, both of the New
problems such as threats to her husbands life and the reasons for such Civil Code, which was still in effect on January 11, 1988 when the deed
threats. As they themselves stated, petitioners problems over the subject in question was executed, the lack of marital consent to the disposition
property had been going on for quite some time, so it is highly improbable of conjugal property does not make the contract void ab initio but merely
for Lorenza not to be aware of what her husband was doing to remedy voidable. Said provisions of law provide:
such problems. Petitioners do not deny that Lorenza Pelayo was present
during the execution of the deed of sale as her signature appears thereon.
Neither do they claim that Lorenza Pelayo had no knowledge whatsoever
about the contents of the subject document. Thus, it is quite
Art. 166. Unless the wife has been declared a non compos mentis or a
spendthrift, or is under civil interdiction or is confined in a leprosarium,
the husband cannot alienate or encumber any real property of the
conjugal property without the wifes consent. If she refuses unreasonably entered into without Lorenzas consent, we find it quite puzzling why for
to give her consent, the court may compel her to grant the same. more than three and a half years, Lorenza did absolutely nothing to seek
the nullification of the assailed contract.
...
The foregoing circumstances lead the Court to believe that Lorenza knew
of the full import of the transaction between respondent and her
Art. 173. The wife may, during the marriage, and within ten years from
the transaction questioned, ask the courts for the annulment of any
contract of the husband entered into without her consent, when such husband; and, by affixing her signature on the deed of sale, she, in effect,
consent is required, or any act or contract of the husband which tends to signified her consent to the disposition of their conjugal property.
defraud her or impair her interest in the conjugal partnership property.
Should the wife fail to exercise this right, she or her heirs, after the
dissolution of the marriage, may demand the value of property
fraudulently alienated by the husband.
Hence, it has been held that the contract is valid until the court annuls
the same and only upon an action brought by the wife whose consent was Art. 1491. The following persons cannot acquire by purchase, even at a
not obtained.[11] In the present case, despite respondents repeated public or judicial auction, either in person or through the mediation of
demands for Lorenza to affix her signature on all the pages of the deed another:
of sale, showing respondents insistence on enforcing said contract,
Lorenza still did not file a case for annulment of the deed of sale. It was
only when respondent filed a complaint for specific performance on
August 8, 1991 when petitioners brought up Lorenzas alleged lack of
consent as an affirmative defense. Thus, if the transaction was indeed
... to the sale of the properties in favor of her son, Rufo, who was the
administrator of the properties. Thus, the consent of the principal
Iluminada Abiertas removes the transaction out of the prohibition
contained in Article 1491(2).[13]
(2) Agents, the property whose administration or sale may have been
entrusted to them, unless the consent of the principal has been given;
The above-quoted ruling is exactly in point with this case before us.
Petitioners, by signing the Deed of Sale in favor of respondent, are also
deemed to have given their consent to the sale of the subject property in
favor of respondent, thereby making the transaction an exception to the
general rule that agents are prohibited from purchasing the property of
...
their principals.
Petitioners also argue that the CA erred in ruling that there was
consideration for the sale. We find no error in said appellate courts ruling.
The element of consideration for the sale is indeed present. Petitioners,
In Distajo vs. Court of Appeals,[12] a landowner, Iluminada Abiertas, in adopting the trial courts narration of antecedent facts in their
designated one of her sons as the administrator of several parcels of her petition,[14] thereby admitted that they authorized respondent to
land. The landowner subsequently executed a Deed of Certification of Sale represent them in negotiations with the squatters occupying the disputed
of Unregistered Land, conveying some of said land to her property and, in consideration of respondents services, they executed the
son/administrator. Therein, we held that: subject deed of sale. Aside from such services rendered by respondent,
petitioners also acknowledged in the deed of sale that they received in
full the amount of Ten Thousand Pesos. Evidently, the consideration for
the sale is respondents services plus the aforementioned cash money.
Under paragraph (2) of the above article, the prohibition against agents
purchasing property in their hands for sale or management is not
absolute. It does not apply if the principal consents to the sale of the
property in the hands of the agent or administrator. In this case, the Petitioners contend that the consideration stated in the deed of sale is
deeds of sale signed by Iluminada Abiertas shows that she gave consent excessively inadequate, indicating that the deed of sale was merely
simulated. We are not persuaded. Our ruling in Buenaventura vs. Court or in any way vitiate the consent of a lawyer like petitioner David Pelayo
of Appeals[15] is pertinent, to wit: who is expected to be more knowledgeable in the ways of drafting
contracts and other legal transactions.
SO ORDERED.
ABALOS VS MACATANGAY JR .
The instant petition seeks a reversal of the Decision of the Court of On November 16, 1989, respondent sent a letter to Arturo and Esther
Appeals in CA-G.R. CV No. 48355 entitled Dr. Galicano S. Macatangay, informing them of his readiness and willingness to pay the full amount of
Jr. v. Arturo R. Abalos and Esther Palisoc-Abalos, promulgated on March the purchase price. The letter contained a demand upon the spouses to
14, 2002. The appellate court reversed the trial courts decision which comply with their obligation to turn over possession of the property to
dismissed the action for specific performance filed by respondent, and him. On the same date, Esther, through her attorney-in-fact, executed in
ordered petitioner and his wife to execute in favor of herein respondent a favor of respondent, a Contract to Sell the property to the extent of her
deed of sale over the subject property. conjugal interest therein for the sum of six hundred fifty thousand pesos
(P650,000.00) less the sum already received by her and Arturo. Esther
agreed to surrender possession of the property to respondent within
Spouses Arturo and Esther Abalos are the registered owners of a parcel twenty (20) days from November 16, 1989, while the latter promised to
of land with improvements located at Azucena St., Makati City consisting pay the balance of the purchase price in the amount of one million two
of about three hundred twenty-seven (327) square meters, covered by hundred ninety thousand pesos (P1,290,000.00) after being placed in
Transfer Certificate of Title (TCT) No. 145316 of the Registry of Deeds of possession of the property. Esther also obligated herself to execute and
Makati. deliver to respondent a deed of absolute sale upon full payment.
Armed with a Special Power of Attorney dated June 2, 1988, purportedly In a letter dated December 7, 1989, respondent informed the spouses
issued by his wife, Arturo executed a Receipt and Memorandum of that he had set aside the amount of One Million Two Hundred Ninety
Agreement (RMOA) dated October 17, 1989, in favor of respondent, Thousand Pesos (P1,290,000.00) as evidenced by Citibank Check No.
binding himself to sell to respondent the subject property and not to offer 278107 as full payment of the purchase price. He reiterated his demand
the same to any other party within thirty (30) days from date. Arturo upon them to comply with their obligation to turn over possession of the
acknowledged receipt of a check from respondent in the amount of Five property. Arturo and Esther failed to deliver the property which prompted
Thousand Pesos (P5,000.00), representing earnest money for the subject respondent to cause the annotation of another adverse claim on TCT No.
property, the amount of which would be deducted from the purchase price 145316. On January 12, 1990, respondent filed a complaint for specific
of One Million Three Hundred Three Hundred Thousand Pesos performance with damages against petitioners. Arturo filed his answer to
(P1,300,000.00). Further, the RMOA stated that full payment would be the complaint while his wife was declared in default.
effected as soon as possession of the property shall have been turned
over to respondent.
The Regional Trial Court (RTC) dismissed the complaint for specific
performance. It ruled that the Special Power of Attorney (SPA) ostensibly
Subsequently, Arturos wife, Esther, executed a Special Power of Attorney issued by Esther in favor of Arturo was void as it was falsified. Hence, the
dated October 25, 1989, appointing her sister, Bernadette Ramos, to act court concluded that the SPA could not have authorized Arturo to sell the
for and in her behalf relative to the transfer of the property to respondent. property to respondent. The trial court also noted that the check issued
Ostensibly, a marital squabble was brewing between Arturo and Esther at by respondent to cover the earnest money was dishonored due to
the time and to protect his interest, respondent caused the annotation of insufficiency of funds and while it was replaced with another check by
his adverse claim on the title of the spouses to the property on November respondent, there is no showing that the second check was issued as
14, 1989. payment for the earnest money on the property.
Petitioner contends that he was not personally served with copies of
summons, pleadings, and processes in the appeal proceedings nor was
On appeal taken by respondent, the Court of Appeals reversed the
he given an opportunity to submit an appellees brief. He alleges that his
decision of the trial court. It ruled that the SPA in favor of Arturo,
counsel was in the United States from 1994 to June 2000, and he never
assuming that it was void, cannot affect the transaction between Esther
received any news or communication from him after the proceedings in
and respondent. The appellate court ratiocinated that it was by virtue of the trial court were terminated. Petitioner submits that he was denied due
the SPA executed by Esther, in favor of her sister, that the sale of the process because he was not informed of the appeal proceedings, nor
property to respondent was effected. On the other hand, the appellate
given the chance to have legal representation before the appellate court.
court considered the RMOA executed by Arturo in favor of respondent
valid to effect the sale of Arturos conjugal share in the property.
Until the contract is perfected, it cannot, as an independent source of As a rule, the holder of the option, after accepting the promise and before
obligation, serve as a binding juridical relation.[4] In a contract of sale, he exercises his option, is not bound to buy. He is free either to buy or
the seller must consent to transfer ownership in exchange for the price, not to buy later. In Sanchez v. Rigos[13] we ruled that in an accepted
the subject matter must be determinate, and the price must be certain in unilateral promise to sell, the promissor is not bound by his promise and
money or its equivalent.[5] Being essentially consensual, a contract of may, accordingly, withdraw it, since there may be no valid contract
sale is perfected at the moment there is a meeting of the minds upon the without a cause or consideration. Pending notice of its withdrawal, his
thing which is the object of the contract and upon the price.[6] However, accepted promise partakes of the nature of an offer to sell which, if
ownership of the thing sold shall not be transferred to the vendee until acceded or consented to, results in a perfected contract of sale.
actual or constructive delivery of the property.[7]
Even conceding for the nonce that respondent had accepted the offer
On the other hand, an accepted unilateral promise which specifies the within the period stated and, as a consequence, a bilateral contract of
thing to be sold and the price to be paid, when coupled with a valuable purchase and sale was perfected, the outcome would be the same. To
consideration distinct and separate from the price, is what may properly benefit from such situation, respondent would have to pay or at least
be termed a perfected contract of option.[8] An option merely grants a make a valid tender of payment of the price for only then could he exact
privilege to buy or sell within an agreed time and at a determined price. compliance with the undertaking of the other party.[14] This respondent
It is separate and distinct from that which the parties may enter into upon failed to do. By his own admission, he merely informed respondent
the consummation of the option.[9] A perfected contract of option does spouses of his readiness and willingness to pay. The fact that he had set
not result in the perfection or consummation of the sale; only when the aside a check in the amount of One Million Two Hundred Ninety Thousand
Pesos (P1,290,000.00) representing the balance of the purchase price
could not help his cause. Settled is the rule that tender of payment must
be made in legal tender. A check is not legal tender, and therefore cannot
The nullity of the RMOA as a contract of sale emanates not only from lack
constitute a valid tender of payment.[15] Not having made a valid tender
of Esthers consent thereto but also from want of consideration and
of payment, respondents action for specific performance must fail.
absence of respondents signature thereon. Such nullity cannot be
obliterated by Esthers subsequent confirmation of the putative
transaction as expressed in the Contract to Sell. Under the law, a void
With regard to the payment of Five Thousand Pesos (P5,000.00), the
contract cannot be ratified[18] and the action or defense for the
Court is of the view that the amount is not earnest money as the term is
declaration of the inexistence of a contract does not prescribe.[19] A void
understood in Article 1482 which signifies proof of the perfection of the
contract produces no effect either against or in favor of anyoneit cannot
contract of sale, but merely a guarantee that respondent is really create, modify or extinguish the juridical relation to which it refers.[20]
interested to buy the property. It is not the giving of earnest money, but
the proof of the concurrence of all the essential elements of the contract
of sale which establishes the existence of a perfected sale.[16] No
reservation of ownership on the part of Arturo is necessary since, as True, in the Contract to Sell, Esther made reference to the earlier RMOA
previously stated, he has never agreed to transfer ownership of the executed by Arturo in favor of respondent. However, the RMOA which
Arturo signed is different from the deed which Esther executed through
property to respondent.
her attorney-in-fact. For one, the first is sought to be enforced as a
contract of sale while the second is purportedly a contract to sell only. For
another, the terms and conditions as to the issuance of title and delivery
Granting for the sake of argument that the RMOA is a contract of sale, of possession are divergent.
the same would still be void not only for want of consideration and
absence of respondents signature thereon, but also for lack of Esthers
conformity thereto. Quite glaring is the absence of the signature of Esther
in the RMOA, which proves that she did not give her consent to the The congruence of the wills of the spouses is essential for the valid
disposition of conjugal property. Where the conveyance is contained in
transaction initiated by Arturo. The husband cannot alienate any real
the same document which bears the conformity of both husband and wife,
property of the conjugal partnership without the wifes consent.[17]
there could be no question on the validity of the transaction. But when
there are two documents on which the signatures of the spouses
separately appear, textual concordance of the documents is
However, it was the Contract to Sell executed by Esther through her
indispensable. Hence, in this case where the wifes putative consent to the
attorney-in-fact which the Court of Appeals made full use of. Holding that
sale of conjugal property appears in a separate document which does not,
the contract is valid, the appellate court explained that while Esther did however, contain the same terms and conditions as in the first document
not authorize Arturo to sell the property, her execution of the SPA
signed by the husband, a valid transaction could not have arisen.
authorizing her sister to sell the land to respondent clearly shows her
intention to convey her interest in favor of respondent. In effect, the court
declared that the lack of Esthers consent to the sale made by Arturo was
Quite a bit of elucidation on the conjugal partnership of gains is in order.
cured by her subsequent conveyance of her interest in the property
through her attorney-in-fact.
Arturo and Esther appear to have been married before the effectivity of
the Family Code. There being no indication that they have adopted a
We do not share the ruling.
different property regime, their property relations would automatically be In not a few cases, we ruled that the sale by the husband of property
governed by the regime of conjugal partnership of gains.[21] belonging to the conjugal partnership without the consent of the wife
when there is no showing that the latter is incapacitated is void ab initio
because it is in contravention of the mandatory requirements of Article
The subject land which had been admittedly acquired during the marriage 166 of the Civil Code.[29] Since Article 166 of the Civil Code requires the
of the spouses forms part of their conjugal partnership.[22] consent of the wife before the husband may alienate or encumber any
real property of the conjugal partnership, it follows that acts or
transactions executed against this mandatory provision are void except
when the law itself authorizes their validity.[30]
Under the Civil Code, the husband is the administrator of the conjugal
partnership. This right is clearly granted to him by law.[23] More, the
husband is the sole administrator. The wife is not entitled as of right to
joint administration.[24] Quite recently, in San Juan Structural and Steel Fabricators, Inc. v. Court
of Appeals,[31] we ruled that neither spouse could alienate in favor of
another, his or her interest in the partnership or in any property belonging
to it, or ask for partition of the properties before the partnership itself had
The husband, even if he is statutorily designated as administrator of the
been legally dissolved. Nonetheless, alienation of the share of each
conjugal partnership, cannot validly alienate or encumber any real
spouse in the conjugal partnership could be had after separation of
property of the conjugal partnership without the wifes consent.[25]
property of the spouses during the marriage had been judicially decreed,
Similarly, the wife cannot dispose of any property belonging to the
upon their petition for any of the causes specified in Article 191[32] of
conjugal partnership without the conformity of the husband. The law is
the Civil Code in relation to Article 214[33] thereof.
explicit that the wife cannot bind the conjugal partnership without the
husbands consent, except in cases provided by law.[26]
SO ORDERED.
CALIMLIM- CANULLAS VS FORTUN
Petition for Review on certiorari assailing the Decision, dated October 6, In its original judgment, respondent Court principally declared DAGUINES
1980, and the Resolution on the Motion for Reconsideration, dated "as the lawful owner of the land in question as well as the one-half () of
November 27, 1980, of the then Court of First Instance of Pangasinan, the house erected on said land." Upon reconsideration prayed for by
Branch I, in Civil Case No. 15620 entitled "Corazon DAGUINES vs. MERCEDES, however, respondent Court resolved:
MERCEDES Calimlim-Canullas," upholding the sale of a parcel of land in
favor of DAGUINES but not of the conjugal house thereon'
WHEREFORE, the dispositive portion of the Decision of this Court,
promulgated on October 6, 1980, is hereby amended to read as follows:
The background facts may be summarized as follows: Petitioner
MERCEDES Calimlim-Canullas and FERNANDO Canullas were married on
December 19, 1962. They begot five children. They lived in a small house (1) Declaring plaintiff as the true and lawful owner of the land in
on the residential land in question with an area of approximately 891 question and the 10 coconut trees;
square meters, located at Bacabac, Bugallon, Pangasinan. After
FERNANDO's father died in 1965, FERNANDO inherited the land.
(2) Declaring as null and void the sale of the conjugal house to plaintiff
on April 15, 1980 (Exhibit A) including the 3 coconut trees and other crops
In 1978, FERNANDO abandoned his family and was living with private planted during the conjugal relation between Fernando Canullas (vendor)
respondent Corazon DAGUINES. During the pendency of this appeal, they and his legitimate wife, herein defendant Mercedes Calimlim- Canullas;
were convicted of concubinage in a judgment rendered on October 27,
1981 by the then Court of First Instance of Pangasinan, Branch II, which
judgment has become final. xxx xxx xxx
On April 15, 1980, FERNANDO sold the subject property with the house The issues posed for resolution are (1) whether or not the construction of
thereon to DAGUINES for the sum of P2,000.00. In the document of sale, a conjugal house on the exclusive property of the husband ipso facto gave
FERNANDO described the house as "also inherited by me from my the land the character of conjugal property; and (2) whether or not the
deceased parents." sale of the lot together with the house and improvements thereon was
valid under the circumstances surrounding the transaction.
It is true that in the case of Maramba vs. Lozano, 3 relied upon by Article 1409 of the Civil Code states inter alia that: contracts whose cause,
respondent Judge, it was held that the land belonging to one of the object, or purpose is contrary to law, morals, good customs, public order,
spouses, upon which the spouses have built a house, becomes conjugal or public policy are void and inexistent from the very beginning.
property only when the conjugal partnership is liquidated and indemnity
paid to the owner of the land. We believe that the better rule is that
enunciated by Mr. Justice J.B.L. Reyes in Padilla vs. Paterno, 3 SCRA 678,
Article 1352 also provides that: "Contracts without cause, or with unlawful
691 (1961), where the following was explained: cause, produce no effect whatsoever. The cause is unlawful if it is contrary
to law, morals, good customs, public order, or public policy."
We reach a different conclusion. While Art. 133 of the Civil Code considers
as void a donation between the spouses during the marriage, policy
considerations of the most exigent character as wen as the dictates of
morality require that the same prohibition should apply to a common-law
relationship.
DISTAJO VS CA
After purchasing the above-mentioned parcels of land, Rufo Distajo took
The case under consideration is a petition for review on certiorari of a
possession of the property and paid the corresponding real estate taxes
decision of the Court of Appeals1 , which modified the ruling of the
thereon. Rhodora Distajo likewise paid for the real estate taxes of Lot No.
Regional Trial Court, Roxas City regarding seven parcels of land located
1057.
in Barangay Hipona, Pontevedra, Capiz.2
On April 9, 1990, the trial court dismissed the complaint for lack of cause
of action, laches and prescription. The counterclaim was likewise
On July 12, 1969, Iluminada Abiertas sold Lot No. 1018 to Rufo Distajo.6 dismissed. The parties appealed to the Court of Appeals.11
Meanwhile, Justo Abiertas, Jr., the brother of Iluminada Abiertas, died On August 21, 1992, the Court of Appeals rendered its decision,12 the
leaving behind his children, Teresita, Alicia, Josefa and Luis Abiertas. dispositive portion of which states as follows:
Teresita paid for the real estate taxes of the following properties, which
she inherited from her father: Lot Nos. 1001, 1048, 1049, and a portion
"PREMISES CONSIDERED, the decision appealed from is hereby SET administrator from acquiring properties under his administration.16 Rufo
ASIDE and a new judgment rendered, as follows: Distajo merely employed fraudulent machinations in order to obtain the
consent of his mother to the sale, and may have even forged her
signature on the deeds of sale of the parcels of land.
WHEREFORE, the Court decides the case in favor of the defendant and
dismisses the plaintiffs’ complaint for lack of cause of action except with
regard to the plaintiffs’ claim over a 238 sq. m. portion of Lot No. 1018 In her comment dated May 13, 1994, private respondent Lagrimas S.
(the portion adjoining the market site and measuring seventeen meters Distajo contends that Rufo Distajo rightfully owns the subject parcels of
and that adjoining the property of E. Rodriguez measuring 14 meters). land because of various deeds of sale executed by Iluminada Abiertas
The Court hereby Orders the partition of Lot No. 1018 to conform to the selling Lot Nos. 1018-B, 1047 and 1046 in favor of Rufo Distajo and Lot
following: 238 sq. m. as above specified to belong to the plaintiffs as No. 1057 in favor of Rhodora Distajo. Private respondent also avers that
prayed for by them while the rest is declared property of the defendant. petitioner cannot claim any right over Lot Nos. 1001, 1048 and 1049,
considering that such lands belong to the brother of Iluminada Abiertas,
namely, Justo Abiertas, Jr., whose heirs sold said parcels of land to Rufo
Upon partition of Lot No. 1018 in accordance with this Court’s Order, the Distajo.
City Assessor of Roxas City is hereby Ordered to cancel Tax Declaration
2813 in the name of Rufo Distajo (or any subsequent tax declaration/s
issued relative to the above-cited Tax Declaration No. 2813) and forthwith The petition lacks merit.
to issue the corresponding tax declarations in the names of the respective
parties herein.
Factual findings of the trial court will not be disturbed on appeal unless
the court has overlooked or ignored some fact or circumstance of
SO ORDERED." sufficient weight or significance, which, if considered, would alter the
result of the case.17 When there is no conflict between the findings of the
trial and appellate courts, a review of the facts found by the appellate
On September 10, 1992, Ricardo Distajo filed a motion for court is unnecessary.18
reconsideration.13 On December 9, 1993, the Court of Appeals denied
the motion.14
Since the trial court and the Court of Appeals agree that Iluminada
Abiertas owned Lot Nos. 1046, 1057 and a portion of Lot No. 1047, and
Hence, this petition.15 that Justo Abiertas Jr. owned Lot Nos. 1001, 1048, and 1049, such
findings are binding on this Court, which is not a trier of facts.19 However,
the record shows that Lot No. 1018 should be divided into Lot No. 1018-
A and 1018-B, the delineation of which the Court of Appeals clarified in
Petitioner alleges that Iluminada Abiertas exclusively owns the seven
its decision.
parcels of land delineated as Lot Nos. 1001, 1018, 1046, 1047, 1048,
1049, and 1057, all of which should be partitioned among all her heirs.
Furthermore, Rufo Distajo cannot acquire the subject parcels of land
owned by Iluminada Abiertas because the Civil Code prohibits the
The issues in this case, therefore, are limited to those properties which Under paragraph (2) of the above article, the prohibition against agents
were owned by Iluminada Abiertas, ascendant of petitioner, consisting of purchasing property in their hands for sale or management is not
Lot Nos. 1018-A, 1046, 1057, and a portion of 1047. absolute. It does not apply if the principal consents to the sale of the
property in the hands of the agent or administrator. In this case, the
deeds of sale signed by Iluminada Abiertas shows that she gave consent
In his petition, Ricardo Distajo assails the genuineness of the signatures to the sale of the properties in favor of her son, Rufo, who was the
of Iluminada Abiertas in the deeds of sale of the parcels of land, and administrator of the properties. Thus, the consent of the principal
claims that Rufo Distajo forged the signature of Iluminada Abiertas. Iluminada Abiertas removes the transaction out of the prohibition
However, no handwriting expert was presented to corroborate the claim contained in Article 1491(2).
of forgery. Petitioner even failed to present a witness who was familiar
with the signature of Iluminada Abiertas. Forgery should be proved by
clear and convincing evidence, and whoever alleges it has the burden of Petitioner also alleges that Rufo Distajo employed fraudulent
proving the same.20 machinations to obtain the consent of Iluminada Abiertas to the sale of
the parcels of land. However, petitioner failed to adduce convincing
evidence to substantiate his allegations.
Petitioner likewise contends that the sale transactions are void for having
been entered into by the administrator of the properties.1âwphi1 We
disagree. The pertinent Civil Code provision provides: In the absence of any showing of lack of basis for the conclusions made
by the Court of Appeals, this Court finds no cogent reason to reverse the
ruling of the appellate court.
"Art. 1491. The following persons cannot acquire by purchase, even at a
public or judicial auction, either in person or through the mediation of
another: WHEREFORE, the Court DENIES the petition and AFFIRMS the decision of
the Court of Appeals in CA-G.R. CV No. 30063.
(1) The guardian, the property of the person or persons who may be
under guardianship; SO ORDERED.
(2) Agents, the property whose administration or sale may have been
entrusted to them, unless the consent of the principal has been given;
ESTIMADO AMIGO —
One of such evidence is the testimony of Rosario Cui, one of the
appellants herein. It should be remembered that it was she who initiated
the proceedings for the declaration of incompetency of Don Mariano Cui La portadora de la presente es mi hija Mercedes, esposa del Dr. Ramas,
in order that he may be placed under guardianship and at the hearing a quien he dado el encargo de presentarse a Vd. con esta carta y pagarle
held for that purpose, she was the main witness. When called upon to en mi nombre como fiador de mi hijo Jesus Cui el saldo resultante de
testify as to the state of health and mental condition of Don Mariano, she laliquidacion hecha por Vd. el 5 de Diciembre de 1941 de la deuda que
stated that during the period she had been living with her father in este contrajo, de Vd. por cierto prestamo en metalico que le dio bajo mi
Calapan, Mindoro, which dates as for back as the Japanese occupation, garantia consistente en hipoteca.
she had observed that the state of his mind was very good, he was not
yet so forgetful as he is now, and that she discovered his mental
weakness which makes him incompetent to manage his own affairs only
Como Vd. trata de cobrar intereses sobre el mencionado saldo hasta la
sometime in the month of January, 1949 (pp. 5 and 6, Exhibit 9; p. 136,
fecha en que se pague el mismo a partir desde el 1.o de Enero de 1944,
t.s.n). And on the strenght of her testimony, Don Mariano was declared
permitame que le suplique encarecidamente apelando a su buen corazon
incompetent on March 31, 1949. This is an indication that, when the deed
y reconocida generosidad, deje Vd. de cobrarme esos intereses. En apoyo
of sale was executed on March 8, 1946, three years before his declaration
de esta suplica someto a su buen criterio lo siguiente: 1.o, mi
of incompetency, Don Mariano was still in the full enjoyment of his
buenavoluntad, diligencia y prontitud en finiquitar al citado saldo; 2.o el
mental-faculties. It should be stated that his testimony of Rosario Cui
motivo, como Vd. lo sabe, se tuvo que contraer la citada deuda sin ningun
stands undisputed.
provecho para mi, antes bien me ha causada molestias y apuros para
pagarla completamente, y 3.o durante la ocupacion japonesa en Cebu y
estando yo ya refugiado en Manila le escribia de vez en cuando a mi dicho
A circumstance which strongly corroborates this testimony of Rosario Cui hijo Jesusy siempre le recordaba que procurara hacerlo por todos los
is the letter Exhibit 26 which Don Mariano wrote to Don Ramon Aboitiz on medios, sabiendo yo que el disponia de bastante dinero; lo cual
May 31, 1946, two months after the execution of the deed of sale Exhibit demuestra a Vd. que la prealudida deuda me ha tenido en constante
A, in relation to the indebtedness he owed him by reason of his having preocupacion, realizandose porultimo mis temores de que al fin habria yo
acted as the surety of his son Jesus Cui which the latter had not been que pagar casi a la deuda entera.
Nbre. 11, 1945
Empiezo dandote las expressivas gracias por su interes y buen deseo por
mi salud, que ya no es tan buena como antes; tengo ya mis achaques a
(Fdo.)
causa de mi vejez que va avanzando cada dia mas; no puedo esperar ya
buena salud.
Scarcely four months before the execution of the deed of sale, Don
Mariano was residing in Calapan, Mindoro, in the house of Rosario Cui,
Me haces una apologia en favor de tu marido Chong, mi hijo, alabandole
and while there he received several letters from his daughter-in-law,
comoun buen hijo; comprendo que lo hagas, porque la pasion te ciega;
Carmen Gomez, wherein in a very expressive and persuasive manner she
pero no me lo digas a mi que conozco muy a-fondo a Chong. Nunca le he
asked her father-in-law, Don Mariano, to extend a helping hand to his son
conocido a Chong como buen hijo mio, pues me ha dado el los mayores
Jesus Cui, who was then confined in the stockade of the military
disgustos que he tenido en mi vida. Mes mijores amigos que esteban al
authorities in Leyte for collaboration, so that he may get his provisional
tanto de la vida de Chong y de sus fracasos en los negocios y con quienes
release by putting up a bail bond for him. Because Jesus Cui, his son, had
a veces me desahogaba, me echaban a mi la culpa porque era yo
embarked him into some commercial venture even before the war which
resulted in a disastrous failure and made him suffer a loss of nearly demasiado apasionado por el. Ahora que llegado a ser pobre, lo
comprendo y lo lamento, y me recuerda de lo que me dijo a mi tia
P25,000, aside from the undertaking he assumed as a surety for the
Benigna, ya difunta (q.e.p.d) un dia, muy formalmente y en serio, que
payment of a loan of P3,000 which Jesus had contracted from Don Ramon
Aboitiz on January 27, 1941 which Jesus failed to pay, all of which made presentia que yo a la vez me quedaria pobre y me aconsejo que tuviera
mucho cuidado en administrar mis bienes con prudencia..
him bitter and resentful against his own son, Don Mariano turned a deaf
ear to the plea of Carmen stating in a language as forceful as it is clear
the reasons for his attitude. These reasons were expressed by Don
Mariano in letters dated November 11, 1945 and November 22, 1945 Siento mucho tener que decirte que no me encuentro en condiciones para
which are also herein reproduced for ready reference, omitting the letters prestar la fianza que me pides en favor de Chong; primero, porque no
of Carmen, which are referred to therein, for being unnecessary for our dispongo de beienes inmuebles para constituir la fianza y segundo,
purpose. Note that the person named Chong appearing in the letters is porque si bien es verdad que me quedan solares en la calle Manalili de
the nickname given to Jesus, son of Don Mariano: esa Ciudad, pero el gravamen de hipoteca sobre estos solares esta sin
cancelarse aun en el registro de propiedad, lo cual tendra aun bastante
tiempo, y por otra parte, me reservo los mismos, siempre libres, para
poder disponer de ellos cuando fuere necesario, para atendar mis gastos.
Calapan, Mindoro
Dispensame, pues, que no pueda complacerte en lo que me pides. Ahora que este hizo a Chong, de TRES MIL PESOS, que creo que estan sin pagar
le escribo a nene para que te envie esta carta como me lo pides. aun y que yo como burro de carga tendre que pagarlos. Debes, pues
dejarme ya en pazporque tengo mala pata en ser fiador de Chong. Estoy
pidiendo a Dios que me de medios para poder ayudarle. Temo, ademas,
En retorno Yre y Nenita te envian sus recuerdos. que Dios me castigue haciendomal uso de los pocos bienes que me ga
dejado para mantenerme durante los pocos anos de vida que me va
considiendo aun y para ni vivir pidiendo limosna, ya que de mis hijos poco
puedo esperar.
Termino deseando a ti y Nene siempre beuna salud y enviando a este un
cariñoso beso y a ti.
MARIANO CUI
Sin otra cosa mas, afectuoso recuerdos a Chong y a ti mi aprecio sincero.
Calapan, Mindoro
Tu suegro,
Nbre. 22, 1945
Rosario Cui not only testified that Don Mariano was still good and of sound
ME APRECIABLE MAMING — mind when he lived with her for eighteen months from September, 1944
up to February, 1946, and for another four months from July, 1946 to
October, 1946 in Calapan, Mindoro, but she also sustained
Recibi el 20 del actual por correo tu carta escrita ya alli en Manila y me correspondence with Don Mariano even as late as the year 1947.
apresuro a contestartela. Hereunder we transcribe Don Mariano's letter to Rosario on July 14, 1947:
Ya habras recibido y te habras enterado ya de mi carta, fecha 11 del Cebu, Julio 14, 1947
actual. Contestando la tuya anterior portador de aquella mi nieto Liling,
que semarcho de aqui para alli el sabado pasado.
Sra. ROSARIO C. DE ENCARNACION
CALAPAN, MINDOROMI
Siento mucho tener que desirte que insisto en mi negativa de ser fiador
de Chong en la forma indirecta que se me propone por los que negocian QUERIDISIMA HIJA —
en prestar fianzas; yo que he sido juez conozco el alcance de esa fianza
queyo otorgue a favor de Don Ramon Aboitiz para garantir el prestamo,
Siento mucho que el no haber tu recibido carta mia desde que he llegado his feeling he wrote to him on March 20, 1947 a letter, copy of which was
aquios haya preocupado tanto artibuyendolo a mi falta de buena salud. marked Exhibit M-2, wherein he appealed to him (his father) to give him
Gracias a Dios no fue asi. and his other children an opportunity to buy the properties in question,
to which letter Don Mariano answered with another date April 22, 1947
wherein he apparently gave in to the demand of Jesus subject to certain
A la semana despues de haber llegado he recibido una carta tuya, condition. As the evidence shows, Don Mariano came to answer the letter
disculpandote de no haber tu podido despedirnos abordo del barco en que of Jesus in this manner: Don Mariano discussed the matter with his son
ibamos con motivo de las fuertes lluvias que entonces cayeron. Te Antonio showing to him the letter of Jesus on which occasion Antonio
conteste que habias hecho muy bien, teniendo tu una salud muy delicada said: "Bueno papa, si tu crees que en eso el esta empeñado y si queres
para cogerte unas mojaduras de funestas consecuencias para ti. darle a el y el ha dicho a ti que el va a hacer todos los medios para
conseguir dicho terreno, puedes hacer todo lo que quiera con tal de que
me devuelves mi dinero que yo habia pagado porque era dinero de mi
esposa." To this Don Mariano answered: "Vamos a ver primero, que es lo
A mediados de mayo ultimo calcule que estarias aun en Manila a
que van a contestar a la carta que voy a mandar."
consequenciaaun de la operacion de tu matriz; pero no sabiendo que
direccion pner en micarta a ti desisti de escribirte.
The letter thus referred to is the one sent by Don Mariano to Jesus, Exhibit
I, wherein the former made known to Jesus that he was willing to give to
Cuanta bondad y generosidad en el arreglo de mi cuarto o habitacion.
all his children equal opportunity to buy the lots in question subject to the
Aunqueno lo veo aun, os lo agradezco ya de todo corazon. Debe de estar
condition that his son or daughter who is not able to pay his debt or
ya muy confortable, y sin las goteras que tanto me molestaban. Espero
obligations or has no money with which to pay them would be
poder volveraun alli en cuanto se termine estos asuntos.
automatically excluded from the sale. The evidence also shows that
neither Jesus nor the other children who wanted to participate in the sale
took the trouble of answering the letter nor made known their desire as
Te deseo que se te desaperezca pronto la debilidad de tu corazon para to the proposition of their father, and such silence is undoubtedly due to
que notengas mas inveycciones de alcampor. the fact that they were not in a financial condition to comply with the
condition imposed in the letter. In fact, according to Antonio Cui, such is
the predicament in which his brothers were situated as shown by the fact
Envio mis mas afectuosos recuerdos a Yre y chiquillos. that Jorge at that time was indebted to his father in the amount of P6,000,
Jesus in the amount of P18,000, Jose in the amount of P14,000, while his
other brothers did not have the necessary means to take part in the sale.
Te da un fuerte abrazo tu padre que entranablamente te quiere. The fact unfolded in connection with this incident constitute a clear
indication of the state of mind then enjoyed by Don Mariano for he took
the precaution before answering the letter of Jesus of discussing the
Another interesting circumstance is the discussion which Jesus Ma. Cui matter first with his son Antonio who was the one mostly affected by the
had with his father Don Mariano on April 20, 1946 relative to the sale of decision he was about to make considering the menacing attitude and the
the lots in question. It should be noted that when Jesus came to know of incessant demand of Jesus regarding the transaction. Only a person of
that sale he could not refrain his anger feeling that he had been ignored sound mind could have adopted such precaution and circumspections.
or the subject of discrimination on the part of his father and give vent to
The deed of sale Exhibit A was executed by Don Mariano Cui, Antonio Cui dirigidas a su hijo Antonio, y fechadas 3 de julio p. 13 de agosto de 1945,
and Mercedes Cui de Ramas on March 8, 1946 in the city of Cebu, and by respectivamente; Exhs. 41 y 42, contestaciones de las cartas de Carmen,
Rosario Cui and her husband Dr. Ireneo Encarnacion in the City of Manila esposa de Jesus, fechadas el 11 y 22 de noviembre de 1945,
on March 20, 1946. The consideration of the sale was P64,000 plus the respectivamente; y exh. 57, dirigida a su hija Rosario, fechada Julio 14,
reservation of the right in favor of Don Mariano "to enjoy the fruits and 1947. Entre los documentos figuran; Exh. 1-a, escitura de reparticion
rents of the same" as long as he lives. It appears however that, while in extrajudicial, otorgada el 6 de deciembre de 1946; Exh. 3-b, un affidavit
said deed of sale it is stated that Don Mariano has acknowledged receipt de fecha 20 de febrero de 1945; Exh. 24, recibo a favor de Gil Ramas,
of said consideration of P64,000, the same is not true with regard to the otorgado el 5 de marzo de 1946; Exh. 24, constanciaque fue suscrita y
share of Rosario Cui. So Don Mariano went to Calapan, Mindoro in July, jurada ante el Escribano de este Juzgado el 23 de febrerode 1948; Exh.
1946 to collect from Rosario her share of the purchase price amounting 34, borrador de exhibit anterior con las correcciones hechas de puno y
to P20,000. Rosario then excused herself from going ahead with the sale letra de Don Mariano Cui; Exh. 44, autorizacion a Mercedes y Antonio
alleging as reason that she needed what money she had to rehabilitate para hipotecar su participacion en los lotes en cuestion, fechadael 7 de
her electric plant in Calapan and also because Cebu was very far from enero de 1947; Exh. 45, convenio entre Don Mariano, por una parte, y
Mindoro where they had already their permanent residence. Not being Mercedes y Antonio, por otra parte, referente a los terrenos en cuestion,
able to pay her share in the consideration of the sale, Don Mariano que lleva fecha 30 de septiembre de 1947; Exh. C escritura de hipoteca
demanded from her the resale of her interest. This was done when she a favor de la RFC de fecha 15 de abril de 1947; y Exh. S, un memorandum
went to Manila on October 11, 1946 to execute the deed of resale in favor que contiene algunas notas de sus ingresos y gastos que comprende has
of Don Mariano. This attitude of Don Mariano is very significant in so far ta el mes de enero de 1949, poco antes de haber perdido su memoria.
as his state of mind is concerned. It shows that he was fully conscious of
what was transpiring and of the transaction he was executing so much so
that he went to the extent of demanding from Rosario the resale of her Una lectura de las cartas arribas mencionadas dos lleva a la necesaria
interest when she failed to pay her share in the consideration of the sale. conviccion de que durante el periodo en que se escibieron las mismas, o
sea hasta el mes de Julio de 1947, Don Mariano Cui aun tenia el pleno
goce de sus facultades mentales, pues de otro modo, el no podia
There are other letters and documents which Don Mariano had prepared expresarsecon tanta claridad y precision en los asuntos que trataba en
and executed in the neighborhood of the time the deed of sale in question dichas cartas. Con respecto a los documentos arriba referidos, los
was executed which also depict the mental condition that he possessed mismos, son de tal naturaleza e importancia, que no se podian haber
at the time, and to show this we can do no better than to quote what the otorgardo por Don Mariano si el no estaba en su cabal juicio. El Exh. S
lower court said on this point: fue presentado por los mismos demandantes, y esta circunstancia,
naturalmente, presupone que ellos admiten que Don Mariano Cui estuvo
mentalmente sano al anotar los asientos en dicho memorandum, muchos
Ademas de lo que ya dejamos expuesto, Don Mariano Cui ejecuto varios de los cuales tuvieron lugar ya despues de otorgarse el documento en
actos que tambien impugnan la contension de que el ya estuvo cuestion Exh. A.
mentalmente incapacitado al otogar el Exh. A. Poco antes y tambien
despues de otogar dicha escritura, el escribo varias cartas a sus hijos y
otogo varios documentos. Entre las cartas figuran el Exh. 4, que esta It is obvious from the foregoing discussion that Don Mariano signed and
dirigida a Jorge, lleva la fecha 24 de marzo de 1945; Exh. 23, dirigida a executed the deed of sale Exhibit A not only at a time when he was still
su hija Mercedes, fechada 9 de septiembre de 1946; Exh. 26, dirigida a in the full enjoyment of his mental faculties, but also under conditions
Don Ramon Aboitiz, fechada el 21 de mayo de 1946; Exhs. 36 y 40 which indicate that he knew what he was doing and, as a consequence,
it cannot be said that he has entered into the transaction without his he stayed up to September, 1944. Then he went to Calapan, Mindoro to
consent or under a misapprehension that the document he was signing live in the house of his daughter Rosario where he stayed up to February,
was not the sale of the properties in question but one merely pertaining 1946 when he returned to Cebu. It was only then that he began living in
to their administration. the house of Mercedes Cui. In Mercedes Cui when the deed of sale was
executed on March 8, 1946. There is therefore no basis for concluding
that said deed of sale was executed simply under the undue influence of
In connection with the contention that the deed of sale Exhibit A was Antonio Cui and Mercedes Cui. The fact that about six days before the
executed by Don Mariano under circumstances which point out that he sale Antonio Cui was made by Don Mariano Cui his attorney in fact could
has done so because of undue influence on the part of the defendants, not mean anything unusual for he was then getting old and he needed
counsel for appellants mentions the following circumstances: (1) Don one who could help him administer the properties of his deceased spouse,
Mariano was already 83 years old, he was the father of the vendees, and and the choice fell on Antonio because he was the only lawyer in the
at the time of the sale or long before it was consummated, he was living family. And if to all this we add that Don Mariano was then in full
with the vendees; (2) one of the vendees, Antonio Cui, was his attorney enjoyment of his mental faculties, as we have already pointed out
in fact and lawyer; (3) the vendor and the vendees had obviously elsewhere, it would be presumptuous, if not unfair, on our part to affirm,
confidential family and spiritual relations; (4) the vendor was suffering as appellants want us to do, that he allowed himself to do an act which is
from mental weakness; and (5) the vendor was in financial distress. The not fully accord with his free and voluntary will.
presence of undue influence, according to appellants, is further shown by
the execution of the mortgage in favor of the Rehabilitation Finance
Corporation, the extra-judicial petition Exh. 1-a, the partition of the We will not take up the claim that the deed of sale Exhibit A was executed
properties in question, the alleged oral waiver of usufructuary rights, and without mediating any consideration on the part of the vendees. if this
the explanatory statement Exhibit 34, which acts, it is claimed, in which were true then said deed would be void and inexistent for it would then
Don Mariano was supposed to have taken part and which were all be afictitious or simulated contract. This claim is merely predicated on the
masterminded by Antonio Cui, show that Antonio Cui could get from his documents Exhibits G and H and the declarations of Rosario Cui and Jesus
father whatever he wanted. Ma. Cui. We will briefly discuss this evidence.
There is however no concrete proof that may substantiate this claim of Exhibit G is an alleged written statement made by Don Mariano Cui on
undue influence. The only direct evidence on the matter is the testimony January 24, 1949 which reads as follows:
of Jesus Cui which in the main is based on mere conjecture and not on
actual facts. The circumstance that Don Mariano Cui was then living in
the house of Mercedes Cui when the deed of sale was signed does not A quien corresponde:
necessarily imply that he was made to sign it under the insidious
machinations practiced on him by his daughter. On the contrary, the
evidence shows that Don Mariano lived most of the time before the
Habiendome enterado que hoy existe un lio entre mis hijos en el Juzgado
execution of the sale with his other children and not necessarily with
sobre mis propiedades t los de mi difunta esposa, y sobre todo porque el
herein defendants. Thus, according to the testimony of Jesus Cui himself,
transpaso de las misma a mi hijo Antonio Ma. Cui ya hija Mercedes Cui
during the Japanese occupation, or from 1942 to 1943, his father lived in
de Ramas no se halla aun pagado por los mismos, es mi deseo que el
the City of Cebu. During the month of September, 1943, he went to
pleito entre mis hijos sea inmediatamente zanjadoy todas participen por
Manila and lived in the house of his daughter Lourdes Cui de Velez, where
igual dichos bienes.
Y para que asi consta firmo esta declaracion en la Ciudad de Cebu, hoy a P. Donde lo firmo este exhibit G?
24 de enero de 1949.
Rosario Cui, testifying on the circumstances surrounding the preparation P. Su hermano de usted estaba presente?
of said Exhibit G, said as follows:
R. Esto me dio mi papa; sabe usted cuando estaba tratando con mi P. Sabiendo usted que su padre vivia en la casa de Mercedes por que no
hermano,este me insulto y estaba y llorando, y despues se fueron al cine; llamo usted a Mercedes para ser mas legal?
y entoncesdijo el; Deja Vd. y mande preparar una orden mia de que yo
quiero se termineese asunto y que se arregle entre estedes y no me gusta
que haya pleito y yo voy a firmar y se preparo eso. No me acuerdo de eso.
P. Usted mando preparar el exhibit G en la localidad? P. Ni siquiera el esposo de su hermana, el Doctor, llamo usted para que
preseciara la firma de este Exhibit G?
Antonia Ma. Cui, testifying on this matter, said: that while he was acting
as private secretary of his father Don Mariano before the was, he had an In the photastic copy Exhibit 31-a, there appear entries Nos. 301, 303,
opportunity to see a copy of the deed of donation of the lots in question 304 and 305 which refer to the deeds of donnation executed by Pedro Cui
in his favor (his father), which copy was furnished by the clerk of court, and Benigna Cui in favor of their nephews and nieces Mauricio Cui, Marta
and at the foot thereof there appears a note to the effect that the original Cui, Victor Cui, Angel Cui and Felicidad Cui. Note that these donations
of said deed was on file in the record of the cadastral case covering the were made exclusively in favor of the nephews and nieces without
property; that said document appears signed by the donors Pedro Cui and including their respective spouses and were all executed on April 11,
Benigna Cui, by the donee Mariano Cui and the instrumental witnesses 1912, or one day before the execution of the donation in favor of Don
Victor Cui and Dionisio Jakosalem; that said copy having been lost, he Mariano Cui. The two photostatic copies Exhibits 31-a and 31-b
went to see the clerk of court to inquire about the original that was on file corroborate the testimony of Marta Cui and Generoso Vda. de Jakosalem
in the record of the cadastral case but the clerk of court told him that the to the effect that all the donations made by Don Pedro Cui and Benigna
record was destroyed during the last was; that he them went to the office Cui in favor of their nephews and nieces were made to them exclusively
of the Bureau of Achives to see if he could get a copy of the document or without including their respective spouses, and subject to the condition
but in said office he only found the notarial register of the notary public that they should renounce their right to inherit from the donors.
Raymundo Enrique wherein the deed of donation appears recorded; that
at his request the chief of said office issued photastic copies of the pages
of the notarial register which contained the annotation relative not only In addition to the foregoing evidence, there are other documents which
to the deed of donation in question but also to that which pertains to the strenghten the contention that the lots in question were donated
other deeds of donation executed by the donors Pedro Cui and Benigna exclusively to Don Mariano Cui. One of them is the inventory prepared by
Cui (Exhibit 31-a and 31-b); that the entry No. 310 that appears in the Don Mariano of the properties which belonged to him exclusively and
copy marked Exhibit 31-b refers to the deed of donation of the lots in those which belonged to the conjugal partnership, as a result of the death
question in favor of his father because said entry refers to a property of his wife Antonia Perales in 1939, copies of which were furnished to all
situated in Plaza Washington, Cebu, where his father did not have any the children of Don Mariano. In this inventory marked Exhibit 8, under
other property except that donated to him by his relatives, which was the heading "Bienes del esposo superviviente Don Mariano Cui," the
later divided into three lots, and that it is of common knowledge among following appears: "1.-Un solar compuesto de los lotes 2312, 2313 y
members of the Cui family that all the nephews of Pedro Cui and Benigna 2319, del Catastro de Cebu, con sus mejoras consistentes en una casa de
Cui received from them by way of donation several pieces of lands subject pierda y madera con techo de teja y con una azotea tambien de pierda y
to the condition that they renounce their right to inherit from the donors. madera." In the same inventory under the heading "Bienes ganancials
habidos durante el matrimonio de Don Mariano Cui y Doña Antonia
Perales," there also appears the following statement: "1. Un edificio mixto
Entry No. 310 which appears in photastic copy Exhibit 31-b contains de concreto y madera con techo de hierro galvanizado . . . construido un
under the heading "Nature of Instrument" the following annotation: una porcion de terreno, de mildosientos cincuenta (1,250) metros
"Donacion condicional que hacen Pedro Cui y Benigna Cui a favor de su cuadrados de superficie, mas o menos, la cual forma parte de un solar de
sobrino Mariano Cui de un solar con todas sus mejoras y edifficio en la mayor extention, situado entre las Calles Manalili y Calderon de la ciudad
plaza de Washington, Cebu; y la aceptacion del donatario quien agradece de Cebu, Cebu . . . y pertenece en propiedad exclusiva al esposa
superviviente Don Mariano Cui." This property is the one known as lots left by his wife Antonia Perales and in said the lots in question were not
Nos. 2312, 2313, and 2319. This inventory was never objected to by the included, while the relation Exhibit 33 includes said lots because they
heirs and shows clearly that while the land belongs exclusively to Don were deemed by Don Mariano as his exclusive property and as such
Mariano Cui the building constructed thereon was considered as conjugal should be included in the assessment to be made in connection with the
property. issuance of the Residence Certificate B. These two documents, which were
prepared by Don Mariano Cui, clearly indicate that the lots in question
were always considered by him as his exclusive property.
Another important document is the extra-judicial partition of the
properties pertaining to the conjugal partnership of Don Mariano Cui and
the deceased wife Antonia Perales, marked Exhibit 1-a, which was signed There can therefore be no doubt, in the light of the overhelming evidence,
by Don Mariano and all his children, with the exception of Jorge Cui, who testimonial as well as documentary, we have discussed in the preceeding
was then in Manila when the document was signed on December 6, 1946. paragraphs, that these three lots in question have always been
In said document mention is made of the inventory which was prepared considered not only by Don Mariano Cui, but by his children and other
by Don Mariano of the conjugal properties belonging to him and his wife, relatives, him by his uncle Pedro Cui and aunt Benigna Cui to the
as well as the powers of attorney executed in favor of Don Mariano by his exclusion of his wife Antonia Perales. Consequently, the contention that,
children authorizing him to administer the properties belonging to the in disposing of said property, Don Mariano Cui has appropriated what
conjugal partnership. It is interesting to note that in this deed of partition belongs to his co-heirs, has completely no function in the evidence.
a relation is made of the conjugal properties as well as of the debts and
obligation which were then existing against the partnership and the
disposition made of the properties to pay said debts and obligations. It is Having reached the conclusion that the lots in question were the exclusive
also interesting to note that the three lots in question are not included in property of Don Mariano Cui and that the deed of sale Exhibit A was
this deed of partition. The fact that all the heirs, with the exception of executed by him freely, intelligently, and with sufficient pecuniary
Jorge, signed this deeds of partition without any protest, is a clear proof consideration, we deem it unnecessary to dwell on the other points
that they knew right along that said lots were exclusive property of their discussed by both parties in their briefs and in their respective
father and did not belong to the conjugal partnership. It is true that memoranda. While these points, vehemently advocated by appellants'
appellants Jesus Ma. Cui and Rosario Cui, while admitting the authenticity counsel may throw could on the due execution of the sale, or may cast
and due execution of the above deed of partition, now contend that they doubt on the sufficiency of its consideration, we are however constrained
signed the same without being aware of its contents, but this contention to uphold its validity if we are to be consistent with our conclusion that
can hardly be given credit, for we can not suppose that, referring as it Don Mariano has executed it while still in the full enjoyment of his mental
does to an important document which concern precisely a partition of faculties, considering that he never lifted a finger to dispute it, in the
inheritance, they should sign the same without first ascertaining or same manner he did with regard to Rosario Cui. No other conclusion is
satisfying themselves of the nature of the transaction. plausible and proper, considering all the circumstances of the case.
Other important documents that may have a bearing on this matter are Wherefore, we hereby affirm the decision appealed from, without
inheritance tax return Exhibit 32 and the relation Exhibit 33 of the real pronouncement as to costs.
properties of Don Mariano Cui for the purpose required by law relative to
the issuance of the Residence Certificate B. The inheritance tax return
was filed by Don Mariano Cui in 1939 in connection with the hereditary
VALENCIA VS CABANTING a notarized deed of sale in lieu of the private document written in Ilocano.
For this purpose, Paulino gave Atty. Antiniw an amount of P200.00 to pay
These consolidated administrative cases seek to disbar respondents the person who would falsify the signature of the alleged vendor
Dionisio Antiniw, Arsenio Fer. Cabanting and Eduardo Jovellanos (the last (Complaint, p. 2; Rollo, p. 7). A "Compraventa Definitiva" (Exh. B) was
named, now an MCTC Judge) for grave malpractice and misconduct in the executed purporting to be a sale of the questioned lot.
exercise of their legal profession committed in the following manner:
Summoned to plead in Civil Case No. V-2170, the Valencias engaged the
services of Atty. Dionisio Antiniw. Atty. Antiniw advised them to present
On October 14, 1974, Constancia Valencia, daughter of Paulino, filed a A deed of donation propter nuptias involving the transfer of a piece of
disbarment proceeding (docketed as Administrative Case No. 1391) land by the grandparents of Lydia Bernal (complainant,) in favor of her
against Atty. Dionisio Antiniw for his participation in the forgery of parents, was lost during the last world war. For this reason, her
"Compraventa Definitiva" and its subsequent introduction as evidence for grandmother (the living donor) executed a deed of confirmation of the
his client; and also, against Attys. Eduardo Jovellanos and Arsenio donation propter nuptias with renunciation of her rights over the property.
Cabanting for purchasing a litigated property allegedly in violation of (Complaint, p. 1). Notwithstanding the deed, her grandmother still
Article 1491 of the New Civil Code; and against the three lawyers, for offered to sell the same property in favor of the complainant, ostensibly
allegedly rigging Civil Case No. V-2170 against her parents. On August to strengthen the deed of donation (to prevent others from claim-ing the
17, 1975, Constancia Valencia filed additional charges against Atty. property).
Antiniw and Atty. Jovellanos as follows:
III. Whether or not the three lawyers connived in rigging Civil Case
On April 12, 1988, We referred the investigation of these cases to the
No. V-2170.
Integrated Bar of the Philippines.1âwphi1 When Atty. Jovellanos was
appointed as Municipal Circuit Trial Court Judge of Alcala-Bautista,
Pangasinan, We referred the investigation of these cases to Acting
Presiding Judge Cesar Mindaro, Regional Trial Court, Branch 50, Villasis, I
Pangasinan, for further investigation.
The three administrative cases were raffled to Branch XVII of the Regional xxx xxx xxx
Trial Court of Manila, under the sala of Judge Catalino Castaneda, Jr.
In the case at bar, while it is true that Atty. Arsenio Fer. Cabanting Although Paulino was a common farmer who finished only Grade IV, his
purchased the lot after finality of judgment, there was still a pending testimony, even if not corroborated by another witness, deserves
certiorari proceeding. A thing is said to be in litigation not only if there is credence and can be relied upon. His declaration dwelt on a subject which
some contest or litigation over it in court, but also from the moment that was so delicate and confidential that it would be difficult to believe the he
it becomes subject to the judicial action of the judge. (Gan Tingco vs. fabricated his evidence.
Pabinguit, 35 Phil. 81). Logic indicates, in certiorari proceedings, that the
appellate court may either grant or dismiss the petition. Hence, it is not
safe to conclude, for purposes under Art. 1491 that the litigation has There is a clear preponderant evidence that Atty. Antiniw committed
terminated when the judgment of the trial court become final while a falsification of a deed of sale, and its subsequent introduction in court
certiorari connected therewith is still in progress. Thus, purchase of the prejudices his prime duty in the administration of justice as an officer of
property by Atty. Cabanting in this case constitutes malpractice in the court.
violation of Art. 1491 and the Canons of Professional Ethics. Clearly, this
malpractice is a ground for suspension.
A lawyer owes entire devotion to the interest of his client (Santos vs.
Dichoso, 84 SCRA 622), but not at the expense of truth. (Cosmos Foundry
The sale in favor of Atty. Jovellanos does not constitute malpractice. Shopworkers Union vs. La Bu, 63 SCRA 313). The first duty of a lawyer
There was no attorney-client relationship between Serapia and Atty. is not to his client but to the administration of justice. (Lubiano vs.
Jovellanos, considering that the latter did not take part as counsel in Civil Gordalla, 115 SCRA 459) To that end, his client's success is wholly
Case No. V-2170. The transaction is not covered by Art. 1491 nor by the subordinate. His conduct ought to and must always be scrupulously
Canons adverted to. observant of law and ethics. While a lawyer must advocate his client's
cause in utmost earnestness and with the maximum skill he can marshal,
he is not at liberty to resort to illegal means for his client's interest. It is
II the duty of an attorney to employ, for the purpose of maintaining the
causes confided to him, such means as are consistent with truth and
honor. (Pangan vs. Ramos, 93 SCRA 87).
It is asserted by Paulino that Atty. Antiniw asked for and received the
sum of P200.00 in consideration of his executing the document
"Compraventa Definitiva" which would show that Paulino bought the Membership in the Bar is a privilege burdened with conditions. By far, the
property. This charge, Atty. Antiniw simply denied. It is settled most important of them is mindfulness that a lawyer is an officer of the
jurisprudence that affirmative testimony is given greater weight than court. (In re: Ivan T. Publico, 102 SCRA 722). This Court may suspend or
negative testimony (Bayasen vs. CA, L-25785, Feb. 26, 1981; Vda. de disbar a lawyer whose acts show his unfitness to continue as a member
Ramos vs. CA, et al., L40804, Jan. 31, 1978). When an individual's of the Bar. (Halili vs. CIR, 136 SCRA 112). Disbarment, therefore, is not
integrity is challenged by evidence, it is not enough that he deny the meant as a punishment depriving him of a source of livelihood but is
charges against him; he must meet the issue and overcome the evidence rather intended to protect the administration of justice by requiring that
those who exercise this function should be competent, honorable and hearsay. "Any evidence, whether oral or documentary, is hearsay if its
reliable in order that courts and the public may rightly repose confidence probative value is not based on the personal knowledge of the witness
in them. (Noriega vs. Sison, 125 SCRA 293). Atty. Antiniw failed to live but on the knowledge of some other person not on the witness stand."
up to the high standards of the law profession. (Regalado, Remedial Law Compendium, 6th ed., vol. 2, 1989, p. 486).
Being hearsay, the evidence presented is inadmissible.
SO ORDERED.
DIRECTOR OF LANDS VS ABABA money which may be adjudged to me from Agripina Abarquez, except
'Attorney's Fees', the same shall pertain to me and not to said lawyer.
This is an appeal from the order of the Court of First Instance of Cebu
dated March 19, 1966 denying the petition for the cancellation of an
adverse claim registered by the adverse claimant on the transfer
IN WITNESS WHEREOF, I have caused my right thumb. mark to be affixed
certificate of title of the petitioners.
hereto this 10th of June, 1961, at the City of Cebu.
The real Property sought to be recovered in Civil Case No. R6573 was
Litigating as a pauper in the lower court and engaging the services of his actually the share of the petitioner in Lots 5600 and 5602, which were
lawyer on a contingent basis, petitioner, liable to compensate his lawyer part of the estate of his deceased parents and which were partitioned the
whom he also retained for his appeal executed a document on June 10, heirs which included petitioner Maximo Abarquez and his elder sister
1961 in the Cebuano-Visayan dialect whereby he obliged himself to give Agripina Abarquez, the defendant in said civil case.
to his lawyer one-half (1/2) of whatever he might recover from Lots 5600
and 5602 should the appeal prosper. The contents of the document as
translated are as follows:
This partition was made pursuant to a project of partition approved by
the Court which provided am other that Lots Nos. 5600 and 5602 were to
be divided into three equal Parts, one third of which shall be given to
AGREEMENT Maximo Abarquez. However, Agripina Abarquez the share of her brother
stating that the latter executed an instrument of pacto de retro prior to
the partition conveying to her any or all rights in the estate of their
KNOW ALL MEN BY THESE PRESENTS: parents. Petitioner discovered later that the claim of his sister over his
share was based on an instrument he was believe all along to be a mere
acknowledgment of the receipt of P700.00 which his sister gave to him
That I, MAXIMO ABARQUEZ, Plaintiff in Case No. R-6573 of the Court of as a consideration for g care of their father during the latter's illness and
First Instance of Cebu, make known through this agreement that for the never an instrument of pacto de retro. Hence, he instituted an action to
services rendered by Atty. Alberto B. Fernandez who is my lawyer in this annul the alleged instrument of pacto de retro.
case, if the appeal is won up to the Supreme Court, I Promise and will
guarantee that I win give to said lawyer one-half (1/2) of what I may
recover from the estate of my father in Lots No. 5600 and 5602 which The Court of Appeals in a decision promulgated on August 27, 1963
are located at Bulacao Pardo, City of Cebu. That with respect to any reversed the decision of the lower court and annulled the dead of pacto
de retro. Appellee Agripina Abarquez filed a motion for reconsideration Notwithstanding the annotation of the adverse claim, petitioner-spouse
but the same was denied in a resolution dated January 7, 1964 (p. 66, Maximo Abarquez and Anastacia Cabigas conveyed by deed of absolute
Record on Appeal; p. 13, Rec.) and the judgment became final and sale on July 29, 1965 two-thirds (2/3) of the lands covered by TCT No.
executory on January 22,1964. 31841 to petitioner-spouses Juan Larrazabal and Marta C. de Larrazabal.
When the new transfer certificate of title No. 32996 was issued, the
annotation of adverse claim on TCT No. 31841 necessarily had to appear
Subsequently, Transfer Certificate of Title No. 31841 was issued on May on the new transfer certificate of title. This adverse claim on TCT No.
19,1965 in the name of Maximo Abarquez, married to Anastacia Cabigas, 32996 became the subject of cancellation proceedings filed by herein
over his adjudged share in Lots Nos. 5600 and 5602 containing an area petitioner-spouses on March 7, 1966 with the Court of First Instance of
of 4,085 square meters (p. 110, ROA; p. 13, rec.). These parcels of land Cebu (p. 2 ROA; p. 13, rec.). The adverse claimant, Atty. Alberto B.
later by the subject matter of the adverse claim filed by the claimant. Fernandez, filed his opposition to the petition for cancellation on March
18, 1966 (p. 20, ROA; p. 13 rec.). The trial court resolved the issue on
March 19, 1966, when it declared that:
The case having been resolved and title having been issued to petitioner,
adverse claimant waited for petitioner to comply with ha obligation under
the document executed by him on June 10, 1961 by delivering the one- ...the petition to cancel the adverse claim should be denied. The
half (½) portion of the said parcels of land. admission by the petitioners that the lawyers (Attys. Fernandez and
Batiguin) are entitled to only one-third of the lot described in Transfer
Certificate of Title No. 32966 is the best proof of the authority to maintain
said adverse claim (p. 57, ROA; p. 13, rec.).
Petitioner refused to comply with his obligation and instead offered to sell
the whole parcels of land covered by TCT No. 31841 to petitioner-spouses
Juan Larrazabal and Marta C. de Larrazabal. Upon being informed of the
intention of the petitioner, adverse t claimant immediately took stops to Petitioner-spouses decided to appeal the order of dismissal to this Court
protect his interest by filing with the trial court a motion to annotate Ins and correspondingly filed the notice of appeal on April 1, 1966 with the
attorney's lien on TCT No. 31841 on June 10, 1965 and by notifying the trial court. On April 2, 1966, petitioner-spouses filed the appeal bond and
prospective buyers of his claim over the one-half portion of the parcels of subsequently filed the record on appeal on April 6, 1966. The records of
land. the case were forwarded to this Court through the Land Registration
Commission of Manila and were received by this Court on May 5, 1966.
Realizing later that the motion to annotate attorney's lien was a wrong
remedy, as it was not within the purview of Section 37, rule 138 of the Counsel for the petitioner-spouses filed the printed record on appeal on
Revised Rule of Court, but before the same was by the trial court, adverse July 12, 1966. Required to file the appellants' brief, counsel filed one on
t by an affidavit of adverse claim on July 19, 1965 with the Register of August 29, 1966 while that of the appellee was filed on October 1, 1966
Deeds of Cebu (p. 14, ROA; p. 13, rec.). By virtue of the petition of mid after having been granted an extension to file his brief.
affidavit the adverse claim for one-half (½) of the lots covered by the
June 10, 1961 document was annotated on TCT No. 31841.
The case was submitted for decision on December 1, 1966. Counsel for
the petitioners filed a motion to expunge appellees' brief on December 8,
1966 for having been filed beyond the reglementary period, but the same article a only to applies stated: " The prohibition in said article applies
was denied by this Court in a resolution dated February 13, 1967. only to a sale or assignment to the lawyer by his client of the property
which is the subject of litigation. In other words, for the prohibition to
operate, the sale or t of the property must take place during the pendency
The pivotal issue to be resolved in the instant case is the validity or nullity of the litigation involving the property" (Rosario Vda. de Laig vs. Court of
of the registration of the adverse claim of Atty. Fernandez, resolution of Appeals, et al., L-26882, November 21, 1978).
which in turn hinges on the question of whether or not the contract for a
contingent fee, basis of the interest of Atty. Fernandez, is prohibited by
the Article 1491 of the New Civil Code and Canon 13 of the Canons of Likewise, under American Law, the prohibition does not apply to "cases
Professional Ethics. where after completion of litigation the lawyer accepts on account of his
fee, an interest the assets realized by the litigation" (Drinker, Henry S.,
Legal Ethics, p. 100 [1953], citing App. A, 280; N.Y. Ciu 714). "There is
Petitioners contend that a contract for a contingent fee violates Article a clear distraction between such cases and one in which the lawyer
1491 because it involves an assignment of a property subject of litigation. speculates on the outcome of the matter in which he is employed"
That article provides: (Drinker, supra, p. 100 citing A.B.A. Op. 279).
Article 1491. The following persons cannot acquire by purchase even at A contract for a contingent fee is not covered by Article 1491 because the
a public or judicial auction, either in person or through the petition of tranfer or assignment of the property in litigation takes effect only after
another. the finality of a favorable judgment. In the instant case, the attorney's
fees of Atty. Fernandez, consisting of one-half (1/2) of whatever Maximo
Abarquez might recover from his share in the lots in question, is
contingent upon the success of the appeal. Hence, the payment of the
xxx xxx xxx
attorney's fees, that is, the transfer or assignment of one-half (1/2) of
the property in litigation will take place only if the appeal prospers.
Therefore, the tranfer actually takes effect after the finality of a favorable
(5) Justices, judges, prosecuting attorneys, clerks of superior and judgment rendered on appeal and not during the pendency of the
inferior and other o and employees connected with the administration of litigation involving the property in question. Consequently, the contract
justice, the property and rights in litigation or levied upon an execution for a contingent fee is not covered by Article 1491.
before the court within whose jurisdiction or territory they exercise their
respective functions; this prohibition includes the act of acquiring by
assignment and shall apply to lawyers, with respect to the property and
While Spanish civilists differ in their views on the above issue — whether
rights which may be the object of any litigation in which they may take
or not a contingent fee contract (quota litis agreement) is covered by
part by virtue of their profession (Emphasis supplied).
Article 1491 — with Manresa advancing that it is covered, thus:
This contention is without merit. Article 1491 prohibits only the sale or
Se ha discutido si en la incapacidad de Ion Procumdam y Abogados asta
assignment between the lawyer and his client, of property which is the
o el pecto de quota litis. Consiste este, como es sabido, en la estipulacion
subject of litigation. As WE have already stated. "The prohibition in said
de que el Abogado o el Procurador ban de hacer suyos una parte alicuota
de In cona que se li m la son es favorable. Con es te concepto a la vista, de rodear a las personas que intervienen en la administracion de justicia
es para nosortros que el articulo que comentamos no menciona ese de todos los prestigios que necesitan para ejercer su ministerio, librando
pacto; pero como la incapacidad de los Abogados y Procuradores se los de toda sospecha, que, aunque fuere infundada, redundaria en
extinede al acto de adquirir por cesion; y la efectividad del pacto de quota descredito de la institucion.
litis implica necesariamente una cesion, estimamos que con solo el num.
5 del articulo 1459 podria con exito la nulidad de ese pacto
tradicionalmente considerado como ilicito. Por no dor lugar a recelos de ninguna clase, admite el Codigo (en el
apartado penutimo del art. 1.459) algunos casos en que, por excepcion,
no se aplica el pricipio prohibitivo de que venimos hablando. Tales son los
xxx xxx xxx de que se trate de acciones hereditarias entre coheredero, de cesion en
pago de creditos, o de garantia de los bienes que posean los funcionarios
de justicia.
Debe tenerse tambien en cuenta, respecto del ultimo parrafo del articulo
1459, la sentencia del Tribunal Supreme de 25 Enero de 1902, que
delcara que si bien el procurador no puede adquirir para si los bienes, en Algunos autores (Goyena, Manresa, Valverde) creen que en la prohibicion
cuanto a los cuales tiene incapacidad, puede adquirirlos para otra persona del art. 1.459 esta comprendido el pacto de quota litis (o sea el convenio
en quien no concurra incapacidad alguna (Manresa, Comentarios al por el cual se concede al Abogado o Procurador, para el caso de obtener
Codigo Civil Español, Tomo X, p. 110 [4a ed., 1931] emphasis supplied). sentencia favorable una parte alicuota de la cosa o cantidad que se litiga),
porque dicho pacto supone la venta o cesion de una parte de la cosa o
drecho que es objecto del litigio. Pero Mucius Scaevola oberva, conrazon,
Castan, maintaining that it is not covered, opines thus; que en el repetido pacto no hay propiamente caso de compraventa ni de
cesion de derechos, y bastan para estimario nulo otros preceptos del
Codigo como los relativos a la ilicitud de la causa (Castan, Derecho Civil
Espñol, Tomo 4, pp. 68-69, [9a ed., 1956], emphasis supplied).
C. Prohibiciones impuestas a las personas encargadas, mas o menos
directamente, de la administracion de justicia.—El mismo art. 1,459 del
Codigo civil prohibe a los Magistrados, Jueces, individuos del Minesterio
fiscal, Secretarios de Tribunales y Juzgados y Oficiales de Justicia adquirir The Supreme Court of Spain, in its sentencia of 12 November 1917, has
por compra (aunque sea en subasta publica o judicial, por si ni por ruled that Article 1459 of the Spanish Civil Code (Article 1491 of our Civil
persona alguna intermedia). 'Los bienes y derechos que estuviesen en Code) does not apply to a contract for a contingent fee because it is not
litigio ante el Tribunal en cuya jurisdicion on teritorio ejercieran sus contrary to morals or to law, holding that:
respectivas funciones, extendiendo se esta prohibicion al acto de adquirir
por cesion', y siendo tambien extensiva ' Alos Abogados y Procuradores
respecto a los bienes y derecho que fueran objeto del un litigio en que ... que no es susceptible de aplicarse el precepto contenido en el num. 5
intervengan pos su profession y oficio.' del art. 1.459 a un contrato en el que se restrigen los honorarios de un
Abogado a un tanto por ciento de lo que se obtuviera en el litigio, cosa
no repudiada por la moral ni por la ley (Tolentino, Civil Code of the
El fundamento de esta prohibicion es clarismo. No solo se trata—dice Philippines, p. 35, Vol. V [1959]; Castan, supra; Manresa, supra).
Manresa—de quitar la ocasion al fraude; persiguese, ademas, el proposito
In the Philippines, among the Filipino commentators, only Justice subject to the supervision of a court, as to its reasonableness." As pointed
Capistrano ventured to state his view on the said issue, thus: out by an authority on Legal Ethics:
The incapacity to purchase or acquire by assignment, which the law also Every lawyer is intensely interested in the successful outcome of his case,
extends to lawyers with t to the property and rights which may be the not only as affecting his reputation, but also his compensation. Canon 13
object of any litigation in which they may take part by virtue of their specifically permits the lawyer to contract for a con tangent fee which of
profession, also covers contracts for professional services quota litis. Such itself, negatives the thought that the Canons preclude the lawyer's having
contracts, however, have been declared valid by the Supreme Court" a stake in his litigation. As pointed out by Professor Cheatham on page
(Capistrano, Civil Code of the Philippines, p. 44, Vol. IV [1951]). 170 n. of his Case Book, there is an inescapable conflict of interest
between lawyer and client in the matter of fees. Nor despite some
statements to the con in Committee opinions, is it believed that,
Dr. Tolentino merely restated the views of Castan and Manresa as well as particularly in view of Canon 13, Canon 10 precludes in every case an
the state of jurisprudence in Spain, as follows: arrangement to make the lawyer's fee payable only out of the results of
the litigation. The distinction is between buying an interest in the litigation
as a speculation which Canon 10 condemns and agreeing, in a case which
the lawyer undertakes primarily in his professional capacity, to accept his
Attorneys-at-law—Some writers, like Goyena, Manresa and Valverde
compensation contingent on the outcome (Drinker, Henry S Legal Ethics,
believe that this article covers quota litis agreements, under which a
p. 99, [1953], Emphasis supplied).
lawyer is to be given an aliquot part of the property or amount in litigation
if he should win the case for his client. Scaevola and Castan, however,
believe that such a contract does not involve a sale or assignment of right
but it may be void under other articles of the Code, such as those referring These Canons of Professional Ethics have already received "judicial
to illicit cause- On the other hand the Spanish Supreme Court has held recognition by being cited and applied by the Supreme Court of the
that this article is not applicable to a contract which limits the fees of a Philippines in its opinion" Malcolm, Legal and Judicial Ethics, p. 9 [1949]).
lawyer to a certain percentage of what may be recovered in litigation, as And they have likewise been considered sources of Legal Ethics. More
this is not contrary to moral or to law. (Tolentino, Civil Code of the importantly, the American Bar Association, through Chairman Howe of
Philippines, p. 35, Vol. V [1959]; Castan, supra, Emphasis supplied). the Ethics Committee, opined that "The Canons of Professional Ethics are
legislative expressions of professional opinion ABA Op. 37 [1912])" [See
footnote 25, Drinker, Legal Ethics, p. 27]. Therefore, the Canons have
some binding effect
Petitioners her contend that a contract for a contingent fee violates the
Canons of Professional Ethics. this is likewise without merit This posture
of petitioners overlooked Canon 13 of the Canons which expressly
contingent fees by way of exception to Canon 10 upon which petitioners Likewise, it must be noted that this Court has already recognized this type
relied. For while Canon 10 prohibits a lawyer from purchasing ...any of a contract as early as the case of Ulanday vs. Manila Railroad Co. (45
interest in the subject matter of the litigation which he is conducting", PhiL 540 [1923]), where WE held that "contingent fees are not prohibited
Canon 13, on the other hand, allowed a reasonable contingent fee in the Philippines, and since impliedly sanctioned by law 'Should be under
contract, thus: "A contract for a con. tangent fee where sanctioned by the supervision of the court in order that clients may be protected from
law, should be reasonable under all the circumstances of the ca including unjust charges' (Canons of Profession 1 Ethics)". The same doctrine was
the risk and uncertainty of the compensation, but should always be
subsequently reiterated in Grey vs. Insular Lumber Co. (97 PhiL 833 to one who is so poor to employ counsel (id, at p. 293, citing Warvelle,
[1955]) and Recto vs. Harden (100 PhiL 427 [1956]). Legal Ethics, p. 92, Emphasis supplied).
In the 1967 case of Albano vs. Ramos (20 SCRA 171 [19671), the Justice George Malcolm, writing on contingent fees, also stated that:
attorney was allowed to recover in a separate action her attomey's fee of
one-third (1/3) of the lands and damages recovered as stipulated in the
contingent fee contract. And this Court in the recent case of Rosario Vda ... the system of contingent compensation has the merit of affording to
de Laig vs. Court of Appeals, et al. (supra), which involved a contingent certain classes of persons the opportunity to procure the prosecution of
fee of one-half (½) of the property in question, held than ,contingent fees their claims which otherwise would be beyond their means. In many cases
are recognized in this i jurisdiction (Canon 13 of the Canons of in the United States and the Philippines, the contingent fee is socially
Professional Ethics adopted by the Philippine Bar association in 1917 necessary (Malcolm, Legal and Judicial Ethics, p. 55 [1949], emphasis
[Appendix B, Revised Rules of Court)), which contingent fees may be a supplied).
portion of the property in litigation."
Having purchased the property with the knowledge of the adverse claim,
they are therefore in bad faith. Consequently, they are estopped from
questioning the validity of the adverse claim.
SO ORDERED.
CONJUGAL PART. OF SPS. CADAVEDO VS LACAYA complaint stated that the spouses Cadavedo hired Atty. Lacaya on a
contingency fee basis. The contingency fee stipulation specifically reads:
We solve in this Rule 45 petition for review on certiorari1 the challenge
to the October 11, 2005 decision2 and the May 9, 2006 resolution3 of the
Court of Appeals (CA) inPetitioners, CA-G.R. CV No. 56948. The CA
10. That due to the above circumstances, the plaintiffs were forced to hire
reversed and set aside the September 17, 1996 decision4 of the Regional
a lawyer on contingent basis and if they become the prevailing parties in
Trial Court (RTC), Branch 10, of Dipolog City in Civil Case No. 4038,
the case at bar, they will pay the sum of ₱2,000.00 for attorney’s fees.6
granting in part the complaint for recovery of possession of property filed
by the petitioners, the Conjugal Partnership of the Spouses Vicente
Cadavedo and Benita Arcoy-Cadavedo against Atty. Victorino (Vic) T.
Lacaya, married to Rosa Legados (collectively, the respondents). In a decision dated February 1, 1972, the RTC upheld the sale of the
subject lot to the spouses Ames. The spouses Cadavedo, thru Atty.
Lacaya, appealed the case to the CA.
The Factual Antecedents
On September 18, 1975, and while the appeal before the CAin Civil Case
No. 1721was pending, the spouses Ames sold the subject lot to their
The Spouses Vicente Cadavedo and Benita Arcoy-Cadavedo (collectively,
children. The spouses Ames’ TCT No. T-4792 was subsequently cancelled
the spouses Cadavedo) acquired a homestead grant over a 230,765-
and TCT No. T-25984was issued in their children’s names. On October
square meter parcel of land known as Lot 5415 (subject lot) located in
11, 1976, the spouses Ames mortgaged the subject lot with the
Gumay, Piñan, Zamboanga del Norte. They were issued Homestead
Development Bank of the Philippines (DBP) in the names of their children.
Patent No. V-15414 on March 13, 1953andOriginal Certificate of Title No.
P-376 on July 2, 1953.On April30, 1955, the spouses Cadavedo sold the
subject lot to the spouses Vicente Ames and Martha Fernandez (the
spouses Ames) Transfer Certificate of Title (TCT) No. T-4792 was On August 13, 1980, the CA issued itsdecision in Civil Case No.
subsequently issued in the name of the spouses Ames. 1721,reversing the decision of the RTC and declaring the deed of sale,
transfer of rights, claims and interest to the spouses Ames null and void
ab initio. It directed the spouses Cadavedo to return the initial payment
and ordered the Register of Deeds to cancel the spouses Ames’ TCT No.
The present controversy arose when the spouses Cadavedo filed an
T-4792 and to reissue another title in the name of the spouses Cadavedo.
action5 before the RTC(then Court of First Instance) of Zamboanga City
The case eventually reached this Court via the spouses Ames’ petition for
against the spouses Ames for sum of money and/or voiding of contract of
review on certiorari which this Court dismissed for lack of merit.
sale of homestead after the latter failed to pay the balance of the
purchase price. The spouses Cadavedo initially engaged the services of
Atty. Rosendo Bandal who, for health reasons, later withdrew from the
case; he was substituted by Atty. Lacaya. Meanwhile, the spouses Ames defaulted in their obligation with the DBP.
Thus, the DBP caused the publication of a notice of foreclosure sale of the
subject lot as covered by TCT No. T-25984(under the name of the spouses
Ames’ children). Atty. Lacaya immediately informed the spouses
On February 24, 1969, Atty. Lacaya amended the complaint to assert the
Cadavedo of the foreclosure sale and filed an Affidavit of Third Party Claim
nullity of the sale and the issuance of TCT No. T-4792 in the names of the
with the Office of the Provincial Sheriff on September 14, 1981.
spouses Ames as gross violation of the public land law. The amended
Meanwhile, on May 21, 1982, the spouses Cadavedo filed before the RTC
an action against the DBP for Injunction; it was docketed as Civil Case
With the finality of the judgment in Civil Case No. 1721,Atty. Lacaya filed
No. 3443 (Cadavedo v. DBP).The RTC subsequently denied the petition,
on September 21, 1981 a motion for the issuance of a writ of execution.
prompting the spouses Cadavedo to elevate the case to the CAvia a
petition for certiorari. The CA dismissed the petition in its decision of
January 31, 1984.
On September 23, 1981,and pending the RTC’s resolution of the motion
for the issuance of a writ of execution, the spouses Ames filed a
complaint7 before the RTC against the spouses Cadavedo for Quieting of
The records do not clearly disclose the proceedings subsequent to the CA
Title or Enforcement of Civil Rights due Planters in Good Faith with prayer
decision in Civil Case No. 3443. However, on August 18, 1988, TCT No.
for Preliminary Injunction. The spouses Cadavedo, thru Atty. Lacaya, filed
41051was issued in the name of the spouses Cadavedo concerning the
a motion to dismiss on the ground of res judicata and to cancel TCT No.
subject lot.
T-25984 (under the name of the spouses Ames’ children).
On August 9, 1988, the spouses Cadavedo filed before the RTC an action9
On October 16, 1981, the RTC granted the motion for the issuance of a
against the respondents, assailing the MTC-approved compromise
writ of execution in Civil Case No. 1721,andthe spouses Cadavedo were
agreement. The case was docketed as Civil Case No. 4038 and is the root
placed in possession of the subject lot on October 24, 1981. Atty. Lacaya
of the present case. The spouses Cadavedo prayed, among others, that
asked for one-half of the subject lot as attorney’s fees. He caused the
the respondents be ejected from their one-half portion of the subject lot;
subdivision of the subject lot into two equal portions, based on area, and
that they be ordered to render an accounting of the produce of this one-
selected the more valuable and productive half for himself; and assigned
half portion from 1981;and that the RTC fix the attorney’s fees on a
the other half to the spouses Cadavedo.
quantum meruit basis, with due consideration of the expenses that Atty.
Lacaya incurred while handling the civil cases.
Unsatisfied with the division, Vicente and his sons-in-law entered the
portion assigned to the respondents and ejected them. The latter During the pendency of Civil Case No. 4038, the spouses Cadavedo
responded by filing a counter-suit for forcible entry before the Municipal
executed a Deed of Partition of Estate in favor of their eight children.
Trial Court (MTC); the ejectment case was docketed as Civil Case No.
Consequently, TCT No. 41051 was cancelled and TCT No. 41690 was
215. This incident occurred while Civil Case No. 3352was pending. issued in the names of the latter. The records are not clear on the
proceedings and status of Civil Case No. 3352.
While the case is pending before this Court, Atty. Lacaya died.15 He was
substituted by his wife -Rosa -and their children –Victoriano D.L. Lacaya, Civil Case No. 4038 –petitioners v. respondents (the present case).
Jr., Rosevic Lacaya-Ocampo, Reymar L. Lacaya, Marcelito L. Lacaya,
Raymundito L. Lacaya, Laila Lacaya-Matabalan, Marivic Lacaya-Barba,
Rosalie L. Lacaya and Ma. Vic-Vic Lacaya-Camaongay.16 The agreement on attorney’s fee
to recover possession
We resolve to GRANT the petition.
The core issue for our resolution is whether the attorney’s fee consisting
of one-half of the subject lot is valid and reasonable, and binds the
The subject lot was the core of four successive and overlapping cases
petitioners. We rule in the NEGATIVE for the reasons discussed below.
prior to the present controversy. In three of these cases, Atty. Lacaya
stood as the spouses Cadavedo’s counsel. For ease of discussion, we
summarize these cases (including the dates and proceedings pertinent to
each) as follows: A. The written agreement providing for
Civil Case No. 1721 – Cadavedo v. Ames (Sum of money and/or voiding over the oral agreement providing for one-
of contract of sale of homestead), filed on January 10, 1967. The writ of
half of the subject lot
execution was granted on October 16, 1981.
In Bautista v. Atty. Gonzales,28 the Court struck down the contingent fee
agreement between therein respondent Atty. Ramon A. Gonzales and his That Atty. Lacaya also served as the spouses Cadavedo’s counsel in the
client for being contrary to public policy. There, the Court held that an two subsequent cases did not and could not otherwise justify an
reimbursement of litigation expenses paid by the former is against public attorney’s fee of one-half of the subject lot. As assertedby the petitioners,
policy, especially if the lawyer has agreed to carry on the action at his the spouses Cadavedo and Atty. Lacaya made separate arrangements for
expense in consideration of some bargain to have a part of the thing in the costs and expenses foreach of these two cases. Thus, the expenses
dispute. It violates the fiduciary relationship between the lawyer and his for the two subsequent cases had been considered and taken cared of
client.29 Based on these considerations, we therefore find one-half of the subject
lot as attorney’s fee excessive and unreasonable.
Article 1491 (5) of the Civil Code forbids lawyers from acquiring, by
C. The attorney’s fee consisting of purchase or assignment, the property that has been the subject of
one-half of the subject lot is excessive litigation in which they have taken part by virtue of their profession.32
The same proscription is provided under Rule 10 of the Canons of
and unconscionable Professional Ethics.33
We likewise strike down the questioned attorney’s fee and declare it void A thing is in litigation if there is a contest or litigation over it in court or
for being excessive and unconscionable.1âwphi1 The contingent fee of when it is subject of the judicial action.34 Following this definition, we
one-half of the subject lot was allegedly agreed to secure the services of find that the subject lot was still in litigation when Atty. Lacaya acquired
Atty. Lacaya in Civil Case No. 1721.Plainly, it was intended for only one the disputed one-half portion. We note in this regard the following
action as the two other civil cases had not yet been instituted at that time. established facts:(1)on September 21, 1981, Atty. Lacaya filed a motion
While Civil Case No. 1721 took twelve years to be finally resolved, that for the issuance of a writ of execution in Civil Case No. 1721; (2) on
period of time, as matters then stood, was not a sufficient reason to September 23, 1981, the spouses Ames filed Civil Case No. 3352 against
the spouses Cadavedo; (3)on October 16, 1981, the RTC granted the While contingent fee agreements are indeed recognized in this jurisdiction
motion filed for the issuance of a writ of execution in Civil Case No. 1721 as a valid exception to the prohibitions under Article 1491(5) of the Civil
and the spouses Cadavedo took possession of the subject lot on October Code,39 contrary to the CA’s position, however, this recognition does not
24, 1981; (4) soon after, the subject lot was surveyed and subdivided apply to the present case. A contingent fee contract is an agreement in
into two equal portions, and Atty. Lacaya took possession of one of the writing where the fee, often a fixed percentage of what may be recovered
subdivided portions; and (5) on May 13, 1982, Vicente and Atty. Lacaya in the action, is made to depend upon the success of the litigation.40 The
executed the compromise agreement. payment of the contingent fee is not made during the pendency of the
litigation involving the client’s property but only after the judgment has
been rendered in the case handled by the lawyer.41
From these timelines, whether by virtue of the alleged oral contingent fee
agreement or an agreement subsequently entered into, Atty. Lacaya
acquired the disputed one-half portion (which was after October 24, In the present case, we reiterate that the transfer or assignment of the
1981) while Civil Case No. 3352 and the motion for the issuance of a writ disputed one-half portion to Atty. Lacaya took place while the subject lot
of execution in Civil Case No. 1721were already pending before the lower was still under litigation and the lawyer-client relationship still existed
courts. Similarly, the compromise agreement, including the subsequent between him and the spouses Cadavedo. Thus, the general prohibition
judicial approval, was effected during the pendency of Civil Case No. provided under Article 1491 of the Civil Code, rather than the exception
3352. In all of these, the relationship of a lawyer and a client still existed provided in jurisprudence, applies. The CA seriously erred in upholding
between Atty. Lacaya and the spouses Cadavedo. the compromise agreement on the basis of the unproved oral contingent
fee agreement.
The allotted portion of the subject lot properly recognizes that litigation
should be for the benefit of the client, not the lawyer, particularly in a
legal situation when the law itself holds clear and express protection to
the rights of the client to the disputed property (a homestead lot).
Premium consideration, in other words, is on the rights of the owner, not
on the lawyer who only helped the owner protect his rights. Matters
cannot be the other way around; otherwise, the lawyer does indeed
effectively acquire a property right over the disputed property. If at all,
due recognition of parity between a lawyer and a client should be on the
fruits of the disputed property, which in this case, the Court properly
accords.
SO ORDERED.
PENA VS DELOS SANTOS
DAROY VS ABECIA Daroy submitted in evidence a report of the National Bureau of
Investigation, which had examined the deed of sale in favor of Jose
This refers to the complaint for malpractice filed by Regalado Daroy (now Gangay, showing that Daroys signature in the deed of sale had been
deceased) against Esteban Abecia, a member of the Bar. Complainant written by a different hand. In addition, Daroy presented the affidavit,
Daroy accused respondent Abecia of having forged his signature in a deed executed on August 10, 1988, of Anita Gangay, wife of Jose Gangay, in
of absolute sale by means of which the latter was able to transfer a parcel which she retracted an earlier affidavit executed on June 5, 1985. In the
of land in Opol, Misamis Oriental, first to Jose Gangay and eventually to first affidavit, she stated that she had bought the land in question from
his (respondents) wife Nena Abecia. Regalado Daroy and then sold it to her sister Nena Abecia, wife of
respondent Esteban. Now, in her present affidavit, it is stated that she
did not buy the land from Daroy nor later sell it to Nena Abecia and that
The facts of the instant case are as follows: she really did not know anything about the controversy between Regalado
Daroy and Esteban Abecia, both of whom are her brothers-in-law. (It
appears that Mrs. Conchita Daroy, Mrs. Anita Gangay, and Mrs. Nena
Respondent Abecia was counsel of complainant Daroy in a case for Abecia are sisters, although Conchita Daroy and Regalado Daroy are not
forcible entry before the Municipal Trial Court of Opol, Misamis married but lived together in a common-law relationship.)
Oriental.[1] Judgment was rendered in favor of complainant as plaintiff
in the ejectment case, ordering the defendants to pay damages, attorneys
fees, and the costs of the suit. To satisfy the judgment, the sheriff sold A complaint for falsification of public document was also filed against
at public auction on March 25, 1971 a parcel of land belonging to one of respondent Abecia in the Office of the City Prosecutor of Cagayan de Oro
the defendants to complainant Daroy as highest bidder for P1,250.00. which, however, dismissed the same.[4] On appeal, then Undersecretary
Upon failure of the defendants to redeem the land, its ownership was of Justice Silvestre H. Bello III reversed on May 6, 1988 the findings of
consolidated in complainant Daroy. the City Prosecutor of Cagayan de Oro and consequently ordered the filing
of the corresponding information in court.[5] Accordingly, City Prosecutor
Rodolfo R. Waga filed an information for falsification of public document,
Complainant Daroy claimed that respondent Abecia forged his signature dated June 30, 1988, with the Regional Trial Court of Misamis Oriental.[6]
in a deed of absolute sale, dated March 31, 1971, transferring the subject
parcel of land to Jose Gangay purportedly for the sum of P1,250.00 and
that in a fictitious deed of absolute sale, dated April 17, 1971, it was made Respondent Abecia was unable to attend the hearings. He asked for their
to appear that Gangay in turn conveyed the land to Nena Abecia, wife of transfer to Cagayan de Oro on the ground that he did not have the means
respondent Abecia, for the sum of P1,350.00.[2] Complainant alleged to travel, but his request was apparently denied sub silencio as the
that he entrusted the title to the land (TCT No. T-315) to Abecia as his Commission continued the hearings in Pasig, Metro Manila. As a result
counsel and allowed him to take possession of the land upon the latters only his counsel was present at the hearings.[7]
request. By means of the forged deed of sale, Abecia was able to obtain
new transfer certificates of title, first in the name of Gangay and then in
that of Mrs. Abecia, from the Registry of Deeds of Misamis Oriental.[3] As respondent reiterated his request for the transfer of venue, it was
Daroy claimed he discovered the fraud only in 1984. agreed at the hearing of January 30, 1989 that respondents answer,
dated August 3, 1987, and the affidavits of his witnesses as well as his
own would be considered as their direct testimonies.[8]
Two weeks thereafter, under date of April 17, 1971, the said Jose Gangay
executed a Deed of Sale of the same property in favor of Mrs. Nena
In his answer, respondent Esteban Abecia maintained that on March 31,
Abecia, the wife of the respondent, by virtue of which TCT No. T-15926
1971, Regalado Daroy sold the land in question to Jose Gangay, and the
was issued in the name of Nena Abecia, married to Atty. Esteban Abecia,
latter in turn sold the land to Nena Abecia on April 17, 1971. He cited the
the respondent.
sheriffs return, dated August 6, 1973, in which it was stated that on
August 4, 1993 Regalado Daroy and his assignee Nena Abecia were . . .
placed in actual possession of the parcel of land subject matter of the
Sometime in the year 1984, the complainant discovered that his said
Deed of Conveyance and Possession.[9] He also referred to the resolution
property was already in the name of Mrs. Nena Abecia and Atty. Esteban
of the Assistant Provincial Fiscal of Misamis Oriental, who dismissed the
complaint for grave coercion and malicious mischief filed by Gertrudes De Abecia.
Bajuyo, one of the defendants in the ejectment case, against Regalado
Daroy and Nena Abecia for the demolition of her house, precisely on the
basis of the right of Mrs. Nena Abecia . . . as assignee to do whatever she ....
wants to do of the things she owns.[10]
Likewise, in Office File No. 419-74 of the Office of the Provincial Fiscal
Respondent Abecia filed a Motion for Reconsideration and/or Appeal.
(Respondents Annex 10) dated April 18, 1974, wherein complainant
Among other things, he contends that:[13]
Regalado Daroy was the accused, then 4th Asst. Fiscal Alejo G. Rola
referred to Nena Abecia as the owner of the subject property by virtue of
her being the assignee and/or transferee of the rights of Regalado Daroy.
....
Indeed, what appears to have happened in this case is that the parties
thought that because the land had been acquired by complainant at a The point is, the parties in this case thought the transfer of the land to
public sale held in order to satisfy a judgment in his favor in a case in respondent Abecia was prohibited and so they contrived a way whereby
which respondent was complainants counsel, the latter could not acquire the land would be sold to Jose Gangay, whose wife Anita is the sister of
the land. The parties apparently had in mind Art. 1491 of the Civil Code Mrs. Nena Abecia, and then Gangay would sell the land to Mrs. Abecia.
which provides, in pertinent parts, as follows: As Jose Gangay stated in his affidavit of March 6, 1985:[18]
ART. 1491. The following persons cannot acquire by purchase, even at a 4. T - Ano ba ang iyong masasabi tungkol sa nangyari?
public or judicial auction, either in person or through the mediation of
another:
S - Sinabihan ako ni Atty. Esteban Abecia, sapagkat siya raw ang abogado
sa lupang pinagkaguluhan, hindi maari na siya ang nakalagay na nagbili
.... ng upa sa kanyang cliente na si Regalado Daroy, dahil laban raw sa
kanilang batas sa mga abogado, kaya sinabihan ako ni Atty. Esteban
Abecia na maari bang gamitin niya ang pangalan ko na ako raw ang
nakabili sa lupa ni Regalado Daroy at paglipas raw ng isang taon, ay
(5) Justices, judges, prosecuting attorneys, clerks of superior and inferior
kanya ng ilipat sa pangalan sa documento at tituto hanggang sa pangalan
courts, and other officers and employees connected with the
ng kanyang asawa na si Nena Abecia.
administration of justice, the property and rights in litigation or levied
The sale of the land to Gangay may be fictitious and, therefore, void, but
that complainant Regalado Daroy intended to convey the land ultimately
5.T - Sumagot ka ba sa hiling ni Atty. Esteban Abecia?
to respondent Esteban Abecia appears to be the case.
S - Opo, pumayag ako dahil silang dalawa, si Regalado Daroy at si Atty. It is true that the NBI found the signature of Regalado Daroy on the deed
Esteban Abecia ay aking mga bilas, sapagkat ang isat-isa naming mga
of sale made in favor of Jose Gangay to have been forged. But Erasmo
asawa ay magkakapatid.
Damasing, the notary public who notarized the deed, affirmed that Daroy
and his wife appeared before him on March 31, 1971 and, in his presence,
signed the document in question.[19] Daisy Felicilda likewise stated in an
6. T - Ano man ang nangyari pagkatapos noon? affidavit executed on February 17, 1986 that she was a witness to the
execution of the deed of sale and that she saw Daroy signing the deed of
sale.[20]
S - Isang araw, ay pumunta si Atty. Esteban Abecia sa amin at sinama
niya ako doon kay Atty. Wilfredo Linaac upang ipa tunayan ang aking
pangalan doon sa documento sa pagbili, at dahil doon, iyong documento Daroy never denied these claims of the notary public and a witness to the
sa pabili ay na notariohan ni Atty. Wilfredo Linaac. execution of the deed of sale. Nor was the NBI writing expert ever called
to testify on his finding that the signature of Daroy in the deed of sale
appeared to have been signed by a different hand. The finding that the
7. T - Binayaran ba kayo ni Nena Abecia at ni Atty. Esteban Abecia sa deed of sale was forged was simply implied from the report of the NBI
pera na naghaga ng isang libo tatlong daan at limang[pung] pesos writing expert. As complainant, Daroy had the burden of proving that
(P1,350.00) na iyong ang halaga sa lupa. contrary to the recital in the jurat he and his wife never appeared before
the notary public and acknowledged the deed to be their voluntary act.
S - Wala.
WHEREFORE, the resolution dated March 26, 1994, of the IBP Board of
Governors is RECONSIDERED and the complaint against respondent
8. T - Ipakita ko sa iyo itong documento ng pagbili at may takda ng petsa Esteban Abecia is DISMISSED.
na Abril 17, 1971 notariadad ni Atty. Wilfredo Linaac Signes sa Doc. No.
333, Pahina 48, Aklat No. VI; taon series sa 1971; ano mang ang
kaugnayan nito sa documento ng pagbili? SO ORDERED.
Invariably, in all cases where Article 1491 was violated, the illegal WHEREFORE, in view of the foregoing, respondent Atty. Patricio A.
transaction was consummated with the actual transfer of the litigated Ngaseo is found guilty of conduct unbecoming a member of the legal
property either by purchase or assignment in favor of the prohibited profession in violation of Rule 20.04 of Canon 20 of the Code of
individual. In Biascan v. Lopez, respondent was found guilty of serious Professional Responsibility. He is REPRIMANDED with a warning that
misconduct and suspended for 6 months from the practice of law when repetition of the same act will be dealt with more severely.
he registered a deed of assignment in his favor and caused the transfer
of title over the part of the estate despite pendency of Special Proceedings
No. 98037 involving the subject property.[10] In the consolidated SO ORDERED.
administrative cases of Valencia v. Cabanting,[11] the Court suspended
respondent Atty. Arsenio Fer Cabanting for six (6) months from the
practice of law when he purchased his client's property which was still the
subject of a pending certiorari proceeding.
We note that the report of the IBP Commissioner, as adopted by the IBP
Board of Governors in its Resolution No. XVI-2003-47, does not clearly
specify which acts of the respondent constitute gross misconduct or what
provisions of the Code of Professional Responsibility have been violated.
We find the recommended penalty of suspension for 6 months too harsh
GAN TIANGCO VS PABINGUIT saying that he made demand upon Candida Acabo and that the latter
stated that she had neither corn nor money; that he levied upon three
It is not disputed in these proceedings that Candida Acabo was the owner plow carabaos, one brood caraballa and the six parcles of land in question,
of six parcels of land, all situated in the municipality of Jimalalud, Oriental for their identity was expressly admitted; that their sale was announced
Negros, of the following dimensions: The first, 8 hectares; the second, 40 for the 20th of March, 1907 (but the return does not show the signature
ares; the third and fourth, each 20 ares; the fifth, 40 ares; and the sixth of the woman upon whom the demand was made, nor does it disclose
parcel, 20 ares. any evidence whatever to show that the owner of this property had any
knowledge of this attachment or levy); that on March 20, 1907, he
proceeded to sell at public auction all the property levied upon; that the
According to the notarial instrument, Exhibit A, admitted in evidence jsutice of the peace who ordered the execution, Henry Gardner, himself
without objection, these lands were sold on June 12, 1911, by their owner appeared as the highest bidder and offered P280 for the four carabaos
Candida Acabo, to one Gan Tingco, for P500. . and P275 for all the coconut groves, that, is the six parcels of land
measuring nine hectares and a fraction in area, containing bearing fruit
trees, or a total sum of P555, which the said successful bidder then and
But the purchaser Gan Tingcowas unable to take possession of the six there paid over; and, finally, that the same justice of the peace, Gardner,
parcels of land sold him by Acabo, for they were in the possession of the highest bidder, himself received the sum of P157.50, the remainder
Silvino Pabinguit, who alleges certain rights therein. He claims to have of the proceeds from the execution sale after deduction of the costs, as
purchased them for P375 from Faustino Abad; that Abad yhad become the person authrized so to do by the plaintiff Silvestre Basaltos; and that
their owner through purchase from Henry Gardner; that the latter, in Gardner alone, not Basaltos nor the judgment debtor Candida Acabo,
turn, had owned tyhem by reason of having purchased them for P555 at signed the record of the proceedings. Afterwards the deputy sheriff
a public auctiona held in the barrio of Martelo, municipality of Tayasan, certified that the costs of the execution amounted to P52.50, and that
on MArch 20, 1907. An effort was made to prove these facts by there was a surplus of P45 to Candida Acabo's credit, which was to be
documents Exhibits 1, 2, and 3. Exhibit 1 is a notarial instrument, dated delivered to her after settlement of the matter of the certificates of
April 29, 1907, which purports to show that on this date Henry Gardner ownership and the arrangment of the trabsfer of the carabaos. These
sold to Faustino Abad seven parcels of land for P275. Exhibit 2 is a notarial proceedings were signed only by the deputy sheriff and recite that "by
instrument which sets forth that Faustino Abad, on June 19, 1907, for the authorization of Candida Acabo I have delivered the sum of P29 as the
sum of P375 sold to Silvino Pabinguit six parcels of land, the area, true balance in favor of the Said Candida Acabo, of the P45 mentione in
situation and bounds of which are described in the document. Exhibit 3 is the precedeing statement, from which latter sum there has been
a copy which the deputy sheriff said he kept of the proceedings had by deducted the amount of P16 which was paid to the treasusrer of this
virtue of a writ of execution issued by the justice of the peace of municipality on the following accounts: Fine, P8; certificate of ownership,
Guijulngan, in whcih the latter directed him to make a demand upon P4; and certificate of transfer, P4." In that manner was the record closed
Candida Acabo to comply with the judgment rendered against her as a and it was not signed by any other person than the deputy sheriff,
result of the complaint, filed by Silvestre Basaltos, and further ordering ALejandro Sanchez.
him, in case of her failure to comply tehrewith, to levy upon "fixtures and
other chattels and to collect the amounts ordered, that is, P157.50, plus
P300 for losses damages, the proper costs and those of this execution." The jusrice of the peace, Gardner, and the deputy sheriff, Sanchez, were
The date of the writ appears to be (for it has been corrected in an illegible summoned to appear in the trial court on March 18, 1914. Sanchez did
manner) that of January 2, 1907, and the fist execution proceedings bear not put in an appearance, and on being required by telegraph to explain
the date of March 14, 1907. In the return the deputy sheriff begins by the reason and show why he should not be punished for contempt of
court, he wired back, saying: "From 12th to 18th instant was making Acabo (it odes not so appear in the writ, wherein only fixtures and other
investigations attempted rape and theft. Will arrive there Monday, 23d. chattels are referred to); that, in consideration of the P555 which Gardner
Will have enough time to finish investigation," and on the day for the paid at the time of the auction, witness, without any reservation
hearing he presented the document Exhibit 3, referred to in the preceding whatsoever, delivered to Gardner the carabaos and lands knocked down
paragragh. to him at the sale; and that after he had received from Gardner the
purchase price he returned it to him, just as he would have delivered it
to the plaintiff Silvestre Basaltos, of whom Gardner claimed to be the
Henry Gardner, in testifying for the defense, stated that the deputy sheriff representative duly authorized as such by this plaintiff.
had executed in Gardner's favor a certificate of his purchase at auction
sale, but witness did not know where the document was and did not need
it because he, in turn, has sold everything he had purchased at that sale; Candida Acabo testified that Alejandro Sanchez, while sheriff of Tayasan,
that he was formerly justice of the peace of the municipality of did not take possession of her lands by reason of the levy; that the only
Guijulngan, of Tayasan, and knew of a complaint by Silvestre Basaltos property which he levied upon was four carabaos, and she did not know
against Candida Acabo; that afterwards when the auction was held, he whether they had been sold at auction; and that Sanchez had not told
took part therein, but that as he subsequently learned that he was her that he lands had been levied upon, or that they had been sold at
forbidden to do so, he sold what he had purchased to Faustino Abad, auction.
Candida Acabo's son, who was but a boy at the time; that the writ of
execution was returnmed to him and he made a record of that matter;
that he had it in the justice of the peace court and left it there when he Silvino Pabinguit testified that in the month of February he was in
ceased to hold office, in 1909. Guijilngan searching for the record of the auction sale of Candida Acabo's
property; that four persons made the search; and . . . the record was not
found. This last statement was made by Alejandro Sanchez.
Faustino Abad testified that Henry Gardner did actually sell to him for
P275 the coconut groves which Gardner had purchased at auction; that it
was true that on April 29, 1907, witness was only 19 years old; that he The Court of First Instance of Oriental NEgros rendered judgment in
knew that the coconut groves were those that had belonged to his mother behalf of the plaintiff, Gan Tingco, declaring him the owner of the lands
Candida Acabo; and that he, in turn, sold the said coconut groves to described in the complaint, and ordered the defendant, Silvino Pabinguit,
Silvino Pabinguit for P375, on June 19 of the same year. Both Gardner's to restore the plaintiff to their possession. No express finfding was made
deed of sale to Abad and the latter's to Pabinguit were certified by the as to the costs.
same deputy sheriff ALejandro Sanchez as notary public of the
municipality of Tayasan.
The defendant appealed, with the right to a review of the evidence. The
appeal was heard by this court, it having been brought it by bill of
This same Alejandro Sanchez, being then the justice of the peace of exceptions.
Tayasan, testified as a witness for the defense. He began by recognizing
the aforesaid deeds as having been certified by him in his capacity of
notary public of Tayasan, and afterwards stated that he had something
The appellant alleges that the trial court erred in holding that,
to do with a writ of execution issued by the justice of the peace of
notwithstanding the sale of the lands in question at public auction,
Guijulngan, Henry Gardner, upon certain real estate belonging to Candida
Candida Acabo did not cease to be the owner of these properties, because delivered the price of the sale, P555, to the sheriff; but hte latter returned
there were certain irregularities and defects in the said auction. this sum to the justice of the peace, who said that he wea authorized by
Silvestre Basaltos, the supposed creditor, to receive the same. At the
finish the sheriff delivered nothing to the owner Acabo, all the proceeds
In the judgment appealed from several of these defects are specified and of the auction sale having been expended in one way or another without
it is unnecessary to treat of them in detail. With respect to the legality of the consent of the judgment debtor appearing of record.
the proceedings had up to the time of the sale of the lands, there is
certainly room for doubt. No evidence is found that Silvestre Basaltos filed
any complaint against Candida Acabo before the justice of the peace court Aside from everything else, the trial court was impressed by the
of Guijulngan and that any judgment was rendered on January 2, 1907, circumstance that in the public auction the purchaser was the justice of
enabling the plaintiff to recover from the defendant 150 cavanes of corn, the peace himself. This, in the judge's opinion, was unauthorized, because
or in default thereof the sum of P157.50, and in addition P300 for losses article 1459, No. 5, of the Civil Code, prohibits judges from acquring by
and damages and court costs. Only the writ of execution appears in the purchase, even at pub;ic or judicial sale, either in person or by an agent,
record. The original copy of the return to the wirt of execution was not any property or rights litigated in the court in the jurisdiction or territory
presented, because it was not found; there was offered in evidence only within which they exercise their respective duties; this prohibition
what the sheriff said was a copy of the return, and he delayed as long in includes taking of property by assignment.
presenting it as he did in obeting the summons of the court to appear as
a witness. No copy of that judgment was delivered to the judgment
debtor, in violation of the provisions of section 446 of Act No. 190. The The appellant alleges that the property purchased by justice of the peace
sheriff sold lands belonging to the judgment debtor, and it does not Gardner was not the subject of litigation in the justice court; that the
appear that the provisions of section 445 of the same Act were complied action was to recover a certain sum of money, and that he had ordered
with, to wit, that if real estate be levied upon and sold by virtue of the the property sold on execution.
execution, the clerk must record the execution and the officer's return
thereon and certify the same under his hand, as true copies, in a book to
be called the "Execution Book." The justice of peace, in his writ, certainly
This raises, therefore, a question as to the true meaning of paragraph 5
did not order the levy upon ior sale of real estate, but only fixtures and
of article 1459 of the Civil Code. lawphil.net
other chattles; but the sheriff's return includes real estate levied upon
and solt at public auction. The purchaser at public auction, the same
justice of the peace, could not exhibit the instrument which he said the
sheriff executed in his behalf, because, as he said, he did not know where The Ley de Bases, in accordance with which the Civil Code was enacted,
it was and that he did not need it. We are not sure that Candida Acabo, provides as follows, in Base No. 26:
a simple country woman, was not despoiled of her lands under the
pretexts of debt, judgment, and execution.
The forms, requirements and conditions of each particular contract shall
be determined and defined subject to the general list of obligations and
Leaving out of account that things which should have been proven at trial their effects, with the understanding that the legislation in force and the
were not proven, it is a positive fact that Henry Gardner, justice of peace legal principles evolved therefrom by judicial decisions, etc., etc., shall
of Guijulngan, was the purchaser at public auction of Candida Acabo's serve as basis.
lands and carabaos levied upon as a result of the judgment, and that he
One of the bodies of law which conastitute the legislation now in force in Sanchez, the sheriff, the sole notary who certified all these deeds of
the Novisima Recopilacion. In Law 4, Title 14, Book 5 of the same is found conveyance in order that Pabinguit might become owner of those coconut
the following provision: "We order that in public auctions held by direction lands with which his own lands adjoined, was in such a hurry that, as he
of our alcaldes, neither the latter nor any person whomsoever in their testified at the trial, on the very same day of the auction he had already
name shall bid in anything sold at such public auctions." The word alcaldes executed in behalf of Henry Gardner the final deed of sale of the said
means judges. The caption of Title 14 is "Alcaldes or Provincial Judges," lands, without allowing time for their possible redemption. Section 466 of
and the entire title deals with the exercise of judicial jurisdiction. Prior to Act No. 190 prescribes that if redemption has not been requested, this
the enactment of the Civil Code, the Penal Code was also in force. Article deed is to be executed within the twelve months subsequent to the sale.
400 of the latter prohinits, under penalty, any judge from taking part,
either directly, or indirectly, in any operation of exchange, trade or porfit
with respect to things not the product of his own property, within the This court finds no reason whatever why it should not affirm the judgment
territory over which he exercises jurisdiction. Judging from the legal appealed from. It is therefore hereby affirmed with the costs of this
oprecedents on which the Civil Code is based, it would not seem too much instance against the appellant. So ordered..
to conclude that the said article of the Civil Code does not make any
distinction between property in litigation. In effect, it appears to be as
delicate a matter for a judge to take part in the sale of property that had
been the subject of ligitgation in his court, as to intervene in auction of
property which, though not directly litigated in his court, is nevertheless
levied upon and sold as the result of a writ of execution issued by him.
What the law intends to avoid is the improper interference with an interest
of a judge in a thing levied upon and sold by his order.
If under the law Gardner was prohibited from acquiring the ownership of
Acabo's lands, then he could not have transmitted to Faustino Abad the
right of ownership that he did not possess; nor could Abad, to whom this
alleged ownership had not been transmitte, have conveyed the same to
Pabinguit. What Gardner should have done in view of the fact that the
sale, as he finally acknowledged, was void, was to claim the price that
had been deposited in court, and the justice of the peace of Guijulngan
should have declared the auction void and have ordered a new sale to be
held, besides correcting the errors that had been committed in the
proceedings. To the reasons already stated, there is to be added the
additional one, with respect to the sale made by Faustino Abad to Silvino
Pabinguit, that Abad was a minor at the time — a circumstance that
deprived him of capacity to sell (Civil Code, art. 1263). Abad had no
ownership to transmit to anyone and, besides, he had no personality to
enable him to contract by himself, on account of his lack of legal age.
MACARIOLA VS ASUNCION On June 8, 1963, a decision was rendered by respondent Judge Asuncion
in Civil Case 3010, the dispositive portion of which reads:
In a verified complaint dated August 6, 1968 Bernardita R. Macariola
charged respondent Judge Elias B. Asuncion of the Court of First Instance
of Leyte, now Associate Justice of the Court of Appeals, with "acts
IN VIEW OF THE FOREGOING CONSIDERATIONS, the Court, upon a
unbecoming a judge."
preponderance of evidence, finds and so holds, and hereby renders
judgment (1) Declaring the plaintiffs Luz R. Bakunawa, Anacorita Reyes,
Ruperto Reyes, Adela Reyes and Priscilla Reyes as the only children
The factual setting of the case is stated in the report dated May 27, 1971 legitimated by the subsequent marriage of Francisco Reyes Diaz to Irene
of then Associate Justice Cecilia Muñoz Palma of the Court of Appeals now Ondez; (2) Declaring the plaintiff Sinforosa R. Bales to have been an
retired Associate Justice of the Supreme Court, to whom this case was illegitimate child of Francisco Reyes Diaz; (3) Declaring Lots Nos. 4474,
referred on October 28, 1968 for investigation, thus: 4475, 4892, 5265, 4803, 4581, 4506 and 1/4 of Lot 1145 as belonging
to the conjugal partnership of the spouses Francisco Reyes Diaz and Felisa
Espiras; (4) Declaring Lot No. 2304 and 1/4 of Lot No. 3416 as belonging
Civil Case No. 3010 of the Court of First Instance of Leyte was a complaint to the spouses Francisco Reyes Diaz and Irene Ondez in common
for partition filed by Sinforosa R. Bales, Luz R. Bakunawa, Anacorita partnership; (5) Declaring that 1/2 of Lot No. 1184 as belonging
Reyes, Ruperto Reyes, Adela Reyes, and Priscilla Reyes, plaintiffs, against exclusively to the deceased Francisco Reyes Diaz; (6) Declaring the
Bernardita R. Macariola, defendant, concerning the properties left by the defendant Bernardita R. Macariola, being the only legal and forced heir of
deceased Francisco Reyes, the common father of the plaintiff and her mother Felisa Espiras, as the exclusive owner of one-half of each of
defendant. Lots Nos. 4474, 4475, 4892, 5265, 4803, 4581, 4506; and the remaining
one-half (1/2) of each of said Lots Nos. 4474, 4475, 4892, 5265, 4803,
4581, 4506 and one-half (1/2) of one-fourth (1/4) of Lot No. 1154 as
In her defenses to the complaint for partition, Mrs. Macariola alleged belonging to the estate of Francisco Reyes Diaz; (7) Declaring Irene
among other things that; a) plaintiff Sinforosa R. Bales was not a Ondez to be the exclusive owner of one-half (1/2) of Lot No. 2304 and
daughter of the deceased Francisco Reyes; b) the only legal heirs of the one-half (1/2) of one-fourth (1/4) of Lot No. 3416; the remaining one-
deceased were defendant Macariola, she being the only offspring of the half (1/2) of Lot 2304 and the remaining one-half (1/2) of one-fourth
first marriage of Francisco Reyes with Felisa Espiras, and the remaining (1/4) of Lot No. 3416 as belonging to the estate of Francisco Reyes Diaz;
plaintiffs who were the children of the deceased by his second marriage (8) Directing the division or partition of the estate of Francisco Reyes Diaz
with Irene Ondez; c) the properties left by the deceased were all the in such a manner as to give or grant to Irene Ondez, as surviving widow
conjugal properties of the latter and his first wife, Felisa Espiras, and no of Francisco Reyes Diaz, a hereditary share of. one-twelfth (1/12) of the
properties were acquired by the deceased during his second marriage; d) whole estate of Francisco Reyes Diaz (Art. 996 in relation to Art. 892, par
if there was any partition to be made, those conjugal properties should 2, New Civil Code), and the remaining portion of the estate to be divided
first be partitioned into two parts, and one part is to be adjudicated solely among the plaintiffs Sinforosa R. Bales, Luz R. Bakunawa, Anacorita
to defendant it being the share of the latter's deceased mother, Felisa Reyes, Ruperto Reyes, Adela Reyes, Priscilla Reyes and defendant
Espiras, and the other half which is the share of the deceased Francisco Bernardita R. Macariola, in such a way that the extent of the total share
Reyes was to be divided equally among his children by his two marriages. of plaintiff Sinforosa R. Bales in the hereditary estate shall not exceed the
equivalent of two-fifth (2/5) of the total share of any or each of the other
plaintiffs and the defendant (Art. 983, New Civil Code), each of the latter
to receive equal shares from the hereditary estate, (Ramirez vs. Bautista,
14 Phil. 528; Diancin vs. Bishop of Jaro, O.G. [3rd Ed.] p. 33); (9)
Directing the parties, within thirty days after this judgment shall have
3. Lots Nos. 4803, 4892 and 5265 shall be awarded to Sinforosa Reyes
become final to submit to this court, for approval a project of partition of
Bales;
the hereditary estate in the proportion above indicated, and in such
manner as the parties may, by agreement, deemed convenient and
equitable to them taking into consideration the location, kind, quality,
nature and value of the properties involved; (10) Directing the plaintiff 4. A portion of Lot No. 3416 consisting of 1,834.55 square meters along
Sinforosa R. Bales and defendant Bernardita R. Macariola to pay the costs the western part of the lot shall likewise be awarded to Sinforosa Reyes-
of this suit, in the proportion of one-third (1/3) by the first named and Bales;
two-thirds (2/3) by the second named; and (I 1) Dismissing all other
claims of the parties [pp 27-29 of Exh. C].
5. Lots Nos. 4474 and 4475 shall be divided equally among Luz Reyes
Bakunawa, Anacorita Reyes, Ruperto Reyes, Adela Reyes and Priscilla
The decision in civil case 3010 became final for lack of an appeal, and on Reyes in equal shares;
October 16, 1963, a project of partition was submitted to Judge Asuncion
which is marked Exh. A. Notwithstanding the fact that the project of
partition was not signed by the parties themselves but only by the 6. Lot No. 1184 and the remaining portion of Lot No. 3416 after taking
respective counsel of plaintiffs and defendant, Judge Asuncion approved the portions awarded under item (2) and (4) above shall be awarded to
it in his Order dated October 23, 1963, which for convenience is quoted Luz Reyes Bakunawa, Anacorita Reyes, Ruperto Reyes, Adela Reyes and
hereunder in full: Priscilla Reyes in equal shares, provided, however that the remaining
portion of Lot No. 3416 shall belong exclusively to Priscilla Reyes.
The parties, through their respective counsels, presented to this Court for
approval the following project of partition: WHEREFORE, it is respectfully prayed that the Project of Partition
indicated above which is made in accordance with the decision of the
Honorable Court be approved.
COMES NOW, the plaintiffs and the defendant in the above-entitled case,
to this Honorable Court respectfully submit the following Project of
Partition: Tacloban City, October 16, 1963.
l. The whole of Lots Nos. 1154, 2304 and 4506 shall belong (SGD) BONIFACIO RAMO Atty. for the Defendant Tacloban City
exclusively to Bernardita Reyes Macariola;
(b) the sum of TWO HUNDRED THOUSAND PESOS [P200,000.001 for (1) Dismissing the complaint against Bonifacio Ramo;
exemplary damages;
(2) Directing the plaintiff to pay the defendant Bonifacio Ramo the cost
(c) the sum of FIFTY THOUSAND PESOS [P50,000.00] for nominal of the suit.
damages; and
I
(1) Dismissing the complaint against the defendants Mariquita Villasin
and the heirs of the deceased Gerardo Villasin;
WE find that there is no merit in the contention of complainant Bernardita
R. Macariola, under her first cause of action, that respondent Judge Elias
(2) Directing the plaintiff to pay the defendants Mariquita Villasin and the B. Asuncion violated Article 1491, paragraph 5, of the New Civil Code in
heirs of Gerardo Villasin the cost of the suit. acquiring by purchase a portion of Lot No. 1184-E which was one of those
properties involved in Civil Case No. 3010. 'That Article provides:
On this point, I agree with respondent that there is no evidence in the 2) Exh. 7 — Certified copy of a deed of absolute sale executed by
record showing that Dr. Arcadio Galapon acted as a mere "dummy" of Bernardita Reyes Macariola on October 22, 1963, conveying to Dr. Hector
respondent in acquiring Lot 1184-E from the Reyeses. Dr. Galapon Decena the one-fourth share of the late Francisco Reyes-Diaz in Lot 1154.
appeared to this investigator as a respectable citizen, credible and In this deed of sale the vendee stated that she was the absolute owner
sincere, and I believe him when he testified that he bought Lot 1184-E in of said one-fourth share, the same having been adjudicated to her as her
good faith and for valuable consideration from the Reyeses without any share in the estate of her father Francisco Reyes Diaz as per decision of
intervention of, or previous understanding with Judge Asuncion (pp. 391- the Court of First Instance of Leyte under case No. 3010 (Exh. 7-A). The
394, rec.).
deed of sale was duly registered and annotated at the back of OCT 19520 value of said properties. Without such evidence there is nothing in the
on December 3, 1963 (see Exh. 9-e). record to show that there were inequalities in the distribution of the
properties of complainant's father (pp. 386389, rec.).
On such transfer (by cession) of territory, it has never been held that the
relations of the inhabitants with each other undergo any change. Their
(h) Directly or indirectly having financial or pecuniary interest in any
relations with their former sovereign are dissolved, and new relations are
business, contract or transaction in connection with which he intervenes
created between them and the government which has acquired their
or takes part in his official capacity, or in which he is prohibited by the
territory. The same act which transfers their country, transfers the
Constitution or by any Iaw from having any interest.
allegiance of those who remain in it; and the law which may be
denominated political, is necessarily changed, although that which
regulates the intercourse and general conduct of individuals, remains in
force, until altered by the newly- created power of the State. Respondent Judge cannot be held liable under the aforestated paragraph
because there is no showing that respondent participated or intervened
in his official capacity in the business or transactions of the Traders
Manufacturing and Fishing Industries, Inc. In the case at bar, the business
Likewise, in People vs. Perfecto (43 Phil. 887, 897 [1922]), this Court
of the corporation in which respondent participated has obviously no
stated that: "It is a general principle of the public law that on acquisition
relation or connection with his judicial office. The business of said
of territory the previous political relations of the ceded region are totally
corporation is not that kind where respondent intervenes or takes part in
abrogated. "
his capacity as Judge of the Court of First Instance. As was held in one
case involving the application of Article 216 of the Revised Penal Code
which has a similar prohibition on public officers against directly or
There appears no enabling or affirmative act that continued the effectivity indirectly becoming interested in any contract or business in which it is
of the aforestated provision of the Code of Commerce after the change of his official duty to intervene, "(I)t is not enough to be a public official to
sovereignty from Spain to the United States and then to the Republic of be subject to this crime; it is necessary that by reason of his office, he
the Philippines. Consequently, Article 14 of the Code of Commerce has no has to intervene in said contracts or transactions; and, hence, the official
legal and binding effect and cannot apply to the respondent, then Judge who intervenes in contracts or transactions which have no relation to his
of the Court of First Instance, now Associate Justice of the Court of office cannot commit this crime.' (People vs. Meneses, C.A. 40 O.G. 11th
Appeals. Supp. 134, cited by Justice Ramon C. Aquino; Revised Penal Code, p.
1174, Vol. 11 [1976]).
Moreover, the prohibition in paragraph 5, Article 1491 of the New Civil
Code against the purchase by judges of a property in litigation before the
It does not appear also from the records that the aforesaid corporation
court within whose jurisdiction they perform their duties, cannot apply to
gained any undue advantage in its business operations by reason of
respondent Judge because the sale of the lot in question to him took place
respondent's financial involvement in it, or that the corporation benefited
after the finality of his decision in Civil Case No. 3010 as well as his two
in one way or another in any case filed by or against it in court. It is orders approving the project of partition; hence, the property was no
undisputed that there was no case filed in the different branches of the longer subject of litigation.
Court of First Instance of Leyte in which the corporation was either party
plaintiff or defendant except Civil Case No. 4234 entitled "Bernardita R.
Macariola, plaintiff, versus Sinforosa O. Bales, et al.," wherein the
complainant herein sought to recover Lot 1184-E from the aforesaid In addition, although Section 12, Rule XVIII of the Civil Service Rules
made pursuant to the Civil Service Act of 1959 prohibits an officer or
corporation. It must be noted, however, that Civil Case No. 4234 was filed
only on November 9 or 11, 1968 and decided on November 2, 1970 by employee in the civil service from engaging in any private business,
vocation, or profession or be connected with any commercial, credit,
CFI Judge Jose D. Nepomuceno when respondent Judge was no longer
agricultural or industrial undertaking without a written permission from
connected with the corporation, having disposed of his interest therein on
the head of department, the same, however, may not fall within the
January 31, 1967.
purview of paragraph h, Section 3 of the Anti-Graft and Corrupt Practices
Act because the last portion of said paragraph speaks of a prohibition by
the Constitution or law on any public officer from having any interest in
Furthermore, respondent is not liable under the same paragraph because
any business and not by a mere administrative rule or regulation. Thus,
there is no provision in both the 1935 and 1973 Constitutions of the
a violation of the aforesaid rule by any officer or employee in the civil
Philippines, nor is there an existing law expressly prohibiting members of
service, that is, engaging in private business without a written permission
the Judiciary from engaging or having interest in any lawful business.
from the Department Head may not constitute graft and corrupt practice
as defined by law.
It may be pointed out that Republic Act No. 296, as amended, also known
as the Judiciary Act of 1948, does not contain any prohibition to that
On the contention of complainant that respondent Judge violated Section
effect. As a matter of fact, under Section 77 of said law, municipal judges
12, Rule XVIII of the Civil Service Rules, We hold that the Civil Service
may engage in teaching or other vocation not involving the practice of
Act of 1959 (R.A. No. 2260) and the Civil Service Rules promulgated
law after office hours but with the permission of the district judge thereunder, particularly Section 12 of Rule XVIII, do not apply to the
concerned.
members of the Judiciary. Under said Section 12: "No officer or employee
shall engage directly in any private business, vocation, or profession or
be connected with any commercial, credit, agricultural or industrial
Likewise, Article 14 of the Code of Commerce which prohibits judges from undertaking without a written permission from the Head of Department
engaging in commerce is, as heretofore stated, deemed abrogated ..."
automatically upon the transfer of sovereignty from Spain to America,
because it is political in nature.
It must be emphasized at the outset that respondent, being a member of
the Judiciary, is covered by Republic Act No. 296, as amended, otherwise
known as the Judiciary Act of 1948 and by Section 7, Article X, 1973 recognize the same as applicable to them, would be adding another
Constitution. ground for the discipline of judges and, as aforestated, Section 67 of the
Judiciary Act recognizes only two grounds for their removal, namely,
serious misconduct and inefficiency.
Under Section 67 of said law, the power to remove or dismiss judges was
then vested in the President of the Philippines, not in the Commissioner
of Civil Service, and only on two grounds, namely, serious misconduct Moreover, under Section 16(i) of the Civil Service Act of 1959, it is the
and inefficiency, and upon the recommendation of the Supreme Court, Commissioner of Civil Service who has original and exclusive jurisdiction
which alone is authorized, upon its own motion, or upon information of "(T)o decide, within one hundred twenty days, after submission to it, all
the Secretary (now Minister) of Justice to conduct the corresponding administrative cases against permanent officers and employees in the
investigation. Clearly, the aforesaid section defines the grounds and competitive service, and, except as provided by law, to have final
prescribes the special procedure for the discipline of judges. authority to pass upon their removal, separation, and suspension and
upon all matters relating to the conduct, discipline, and efficiency of such
officers and employees; and prescribe standards, guidelines and
And under Sections 5, 6 and 7, Article X of the 1973 Constitution, only regulations governing the administration of discipline" (emphasis
the Supreme Court can discipline judges of inferior courts as well as other supplied). There is no question that a judge belong to the non-competitive
personnel of the Judiciary. or unclassified service of the government as a Presidential appointee and
is therefore not covered by the aforesaid provision. WE have already ruled
that "... in interpreting Section 16(i) of Republic Act No. 2260, we
emphasized that only permanent officers and employees who belong to
It is true that under Section 33 of the Civil Service Act of 1959: "The
the classified service come under the exclusive jurisdiction of the
Commissioner may, for ... violation of the existing Civil Service Law and
Commissioner of Civil Service" (Villaluz vs. Zaldivar, 15 SCRA 710,713
rules or of reasonable office regulations, or in the interest of the service,
[1965], Ang-Angco vs. Castillo, 9 SCRA 619 [1963]).
remove any subordinate officer or employee from the service, demote
him in rank, suspend him for not more than one year without pay or fine
him in an amount not exceeding six months' salary." Thus, a violation of
Section 12 of Rule XVIII is a ground for disciplinary action against civil Although the actuation of respondent Judge in engaging in private
service officers and employees. business by joining the Traders Manufacturing and Fishing Industries, Inc.
as a stockholder and a ranking officer, is not violative of the provissions
of Article 14 of the Code of Commerce and Section 3(h) of the Anti-Graft
and Corrupt Practices Act as well as Section 12, Rule XVIII of the Civil
However, judges cannot be considered as subordinate civil service officers
Service Rules promulgated pursuant to the Civil Service Act of 1959, the
or employees subject to the disciplinary authority of the Commissioner of
impropriety of the same is clearly unquestionable because Canon 25 of
Civil Service; for, certainly, the Commissioner is not the head of the
the Canons of Judicial Ethics expressly declares that:
Judicial Department to which they belong. The Revised Administrative
Code (Section 89) and the Civil Service Law itself state that the Chief
Justice is the department head of the Supreme Court (Sec. 20, R.A. No.
2260) [1959]); and under the 1973 Constitution, the Judiciary is the only A judge should abstain from making personal investments in enterprises
other or second branch of the government (Sec. 1, Art. X, 1973 which are apt to be involved in litigation in his court; and, after his
Constitution). Besides, a violation of Section 12, Rule XVIII cannot be accession to the bench, he should not retain such investments previously
considered as a ground for disciplinary action against judges because to made, longer than a period sufficient to enable him to dispose of them
without serious loss. It is desirable that he should, so far as reasonably who openly and publicly advertised himself as a practising attorney (see
possible, refrain from all relations which would normally tend to arouse Exhs. I, I-1 and J) when in truth and in fact said Dominador Arigpa Tan
the suspicion that such relations warp or bias his judgment, or prevent does not appear in the Roll of Attorneys and is not a member of the
his impartial attitude of mind in the administration of his judicial duties. Philippine Bar as certified to in Exh. K.
...
With respect to the third and fourth causes of action, complainant alleged Of course it is highly desirable for a member of the judiciary to refrain as
that respondent was guilty of coddling an impostor and acted in disregard much as possible from maintaining close friendly relations with practising
of judicial decorum, and that there was culpable defiance of the law and attorneys and litigants in his court so as to avoid suspicion 'that his social
utter disregard for ethics. WE agree, however, with the recommendation or business relations or friendship constitute an element in determining
of the Investigating Justice that respondent Judge be exonerated because his judicial course" (par. 30, Canons of Judicial Ethics), but if a Judge does
the aforesaid causes of action are groundless, and WE quote the pertinent have social relations, that in itself would not constitute a ground for
portion of her report which reads as follows: disciplinary action unless it be clearly shown that his social relations be
clouded his official actuations with bias and partiality in favor of his friends
(pp. 403-405, rec.).
The basis for complainant's third cause of action is the claim that
respondent associated and closely fraternized with Dominador Arigpa Tan
In conclusion, while respondent Judge Asuncion, now Associate Justice of
the Court of Appeals, did not violate any law in acquiring by purchase a
parcel of land which was in litigation in his court and in engaging in
business by joining a private corporation during his incumbency as judge
of the Court of First Instance of Leyte, he should be reminded to be more
discreet in his private and business activities, because his conduct as a
member of the Judiciary must not only be characterized with propriety
but must always be above suspicion.
SO ORDERED.
AKANG VS MUNICIPALITY OF ISULAN administrators to have and to hold forevery (sic) and definitely, which portion
shall be utilized purposely and exclusively as a GOVERNMENT CENTER SITE x x
This case was originally filed as a petition for certiorari under Rule 65 of the Rules
x."7
of Court. In the Court's Resolution dated March 9, 2009, however, the petition
was treated as one for review under Rule.45.1 Assailed is the Decision2 dated
April 25, 2008 and Resolution3 dated October 29, 2008 of the Court of Appeals
The respondent immediately took possession of the property and began
Mindanao Station (CA) in CA-G.R. CV No. 00156, which reversed the Judgment4
construction of the municipal building.8
dated January 14, 2004 of the Regional Trial Court (RTC) of Isulan, Sultan Kudarat,
Branch 19 in Civil Case No. 1007 for Recovery of Possession of Subject Property
and/or Quieting of Title thereon and Damages.
Thirty-nine (39) years later or on October 26, 2001, the petitioner, together with
his wife, Patao Talipasan, filed a civil action for Recovery of Possession of Subject
Property and/or Quieting of Title thereon and Damages against the respondent,
The Facts
represented by its Municipal Mayor, et al.9
c. Ordering the defendants to pay plaintiffs, the value of the lot in question, Lot
The RTC also ruled that the Deed of Sale was not approved pursuant to Section
No. 5-B-2-B-14-F (LRC) Psd 110183, containing an area of 20,030 Square Meters,
145 of the Administrative Code for Mindanao and Sulu or Section 120 of the
at the prevailing market value, as may be reflected in its Tax Declaration, or in the
Public Land Act (PLA), as amended. Resolution No. 70,15 which was issued by the
alternative, to agree on the payment of monthly back rentals, retroactive to 1996,
respondent, appropriating the amount of ₱3,000.00 as payment for the property,
until defendants should decide to buy and pay the value of said lot as aforestated,
and Resolution No. 644 of the Provincial Board of Cotabato, which approved
with legal interest in both cases;
Resolution No. 70, cannot be considered proof of the sale as said Deed of Sale
was not presented for examination and approval of the Provincial Board.16
Further, since the respondent’s possession of the property was not in the concept
of an owner, laches cannot be a valid defense for claiming ownership of the d. Ordering the defendant, Municipal Government of Isulan, Sultan Kudarat, to
property, which has been registered in the petitioner’s name under the Torrens pay plaintiffs, by way of attorney’s fee, the equivalent of 30% of the value that
System.17 defendants would pay the plaintiffs for the lot in question; and to pay plaintiffs
the further sum of ₱100,000.00, by way of moral and exemplary damages;
The dispositive portion of the RTC Decision18 dated January 14, 2004 reads:
e. Ordering the defendants, members of the Sangguniang Bayan of Isulan, Sultan
Kudarat, to pass a resolution/ordinance for the appropriation of funds for the
payment of the value of plaintiffs’ Lot 5-B-2-B-14-F (LRC) Psd-110183, and of the
WHEREFORE, upon all the foregoing considerations, judgment is hereby
damages herein awarded to the plaintiffs; and
rendered:
IT IS SO ORDERED.19 The CA also ruled that the Deed of Sale is not a mere contract to sell but a
perfected contract of sale. There was no express reservation of ownership of title
by the petitioner and the fact that there was yet no payment at the time of the
By virtue of said RTC decision, proceedings for the Cancellation of Certificate of sale does not affect the validity or prevent the perfection of the sale.23
Title No. T-49349 registered under the name of the respondent was instituted by
the petitioner under Miscellaneous Case No. 866 and as a result, the respondent’s
title over the property was cancelled and a new one issued in the name of the As regards the issue of whether payment of the price was made, the CA ruled that
petitioner. there was actual payment, as evidenced by the Municipal Voucher, which the
petitioner himself prepared and signed despite the lack of approval of the
Municipal Treasurer. Even if he was not paid the consideration, it does not affect
The respondent appealed the RTC Decision dated January 14, 2004 and in the the validity of the contract of sale for it is not the fact of payment of the price that
Decision20 dated April 25, 2008, the CA reversed the ruling of the RTC and upheld determines its validity.24
the validity of the sale. The dispositive portion of the CA Decision provides:
The respondent, however, counters that: (1) the petitioner is not an illiterate non-
Christian and he, in fact, was able to execute, sign in Arabic, and understand the The petitioner alleges that the Deed of Sale is merely an agreement to sell, which
terms and conditions of the Special Power of Attorney dated July 23, 1996 issued was not perfected due to non-payment of the stipulated consideration.32 The
in favor of Baikong Akang (Baikong); (2) the Deed of Sale is valid as its terms and respondent, meanwhile, claims that the Deed of Sale is a valid and perfected
conditions were reviewed by the Municipal Council of Isulan and the Provincial contract of absolute sale.33
Board of Cotabato; and (3) the Deed of Sale is a contract of sale and not a
contract to sell.29
A contract of sale is defined under Article 1458 of the Civil Code:
A contract to sell, on the other hand, is defined by Article 1479 of the Civil Code:
Even assuming, arguendo, that the petitioner was not paid, such non payment is
In a contract of sale, the title to the property passes to the buyer upon the
immaterial and has no effect on the validity of the contract of sale. A contract of
delivery of the thing sold, whereas in a contract to sell, the ownership is, by
sale is a consensual contract and what is required is the meeting of the minds on
agreement, retained by the seller and is not to pass to the vendee until full
the object and the price for its perfection and validity.38 In this case, the contract
payment of the purchase price.35
was perfected the moment the petitioner and the respondent agreed on the
object of the sale – the two-hectare parcel of land, and the price – Three
Thousand Pesos (₱3,000.00). Non-payment of the purchase price merely gave rise
The Deed of Sale executed by the petitioner and the respondent is a perfected to a right in favor of the petitioner to either demand specific performance or
contract of sale, all its elements being present. There was mutual agreement rescission of the contract of sale.39
between them to enter into the sale, as shown by their free and voluntary signing
of the contract. There was also an absolute transfer of ownership of the property
by the petitioner to the respondent as shown in the stipulation: "x x x I petitioner
Sections 145 and 146 of the Administrative Code of Mindanao and Sulu, and
hereby sell, transfer, cede, convey and assign as by these presents do have sold,
Section 120 of the PLA, as amended, are not applicable
transferred, ceded, conveyed and assigned, x x x."36 There was also a determine
subject matter, that is, the two-hectare parcel of land as described in the Deed of
Sale. Lastly, the price or consideration is at Three Thousand Pesos (₱3,000.00),
The petitioner relies on the foregoing laws in assailing the validity of the Deed of
which was to be paid after the execution of the contract. The fact that no express
Sale, claiming that the contract lacks executive approval and that he is an illiterate
reservation of ownership or title to the property can be found in the Deed of Sale
non-Christian to whom the benefits of Sections 145 and 146 of the Administrative
bolsters the absence of such intent, and the contract, therefore, could not be one
Code of Mindanao and Sulu should apply.
to sell. Had the intention of the petitioner been otherwise, he could have: (1)
at the expense of another. More important, the law will not be applied so
stringently as to render ineffective a contract that is otherwise valid, except for
Section 145 of the Administrative Code of Mindanao and Sulu essentially provides
want of approval by the CNI. This principle holds, especially when the evils sought
for the requisites of the contracts entered into by a person with any Moro or
to be avoided are not obtaining.46
other non-Christian inhabitants.40 Section 146,41 meanwhile, provides that
contracts entered into in violation of Section 145 are void. These provisions aim
to safeguard the patrimony of the less developed ethnic groups in the Philippines
The Court must also reject the petitioner’s claim that he did not understand the
by shielding them against imposition and fraud when they enter into agreements
import of the agreement.1âwphi1 He alleged that he signed in Arabic the Deed of
dealing with realty.42
Sale, the Joint Affidavit and the Municipal Voucher, which were all in English, and
that he was not able to comprehend its contents. Records show the contrary. The
petitioner, in fact, was able to execute in favor of Baikong a Special Power of
Section 120 of the PLA (Commonwealth Act No. 141) affords the same
Attorney (SPA) dated July 23, 1996, which was written in English albeit signed by
protection.43 R.A. No. No. 387244 likewise provides that conveyances and
the petitioner in Arabic. Said SPA authorized Baikong, the petitioner’s sister, to
encumbrances made by illiterate non-Christian or literate non-Christians where
follow-up the payment of the purchase price. This raises doubt on the veracity of
the instrument of conveyance or encumbrance is in a language not understood by
the petitioner’s allegation that he does not understand the language as he would
said literate non-Christians shall not be valid unless duly approved by the
not have been able to execute the SPA or he would have prevented its
Chairman of the Commission on National Integration.
enforcement.
WHEREFORE, the appeal is DENIED. The Decision dated April 25, 2008 and
More particularly, laches will bar recovery of a property, even if the mode of Resolution dated October 29, 2008 of the Court of Appeals Mindanao Station in
transfer used by an alleged member of a cultural minority lacks executive CA-G.R. CV No. 00156 are AFFIRMED.
approval.54 Thus, in Heirs of Dicman v. Cariño,55 the Court upheld the Deed of
Conveyance of Part Rights and Interests in Agricultural Land executed by Ting-el
Dicman in favor of Sioco Cariño despite lack of executive approval. The Court SO ORDERED.
stated that "despite the judicial pronouncement that the sale of real property by
illiterate ethnic minorities is null and void for lack of approval of competent
authorities, the right to recover possession has nonetheless been barred through
the operation of the equitable doctrine of laches."56 Similarly in this case, while
the respondent may not be considered as having acquired ownership by virtue of
its long and continued possession, nevertheless, the petitioner’s right to recover
has been converted into a stale demand due to the respondent’s long period of
possession and by the petitioner’s own inaction and neglect.57 The Court cannot
accept the petitioner’s explanation that his delayed filing and assertion of rights
was due to Martial Law and the Cotabato Ilaga-Black Shirt Troubles. The Martial
Law regime was from 1972 to 1986, while the Ilaga-Black Shirt Troubles were
from the 1970s to the 1980s. The petitioner could have sought judicial relief, or at
the very least made his demands to the respondent, as early as the third quarter
of 1962 after the execution of the Deed of Sale and before the advent of these
events. Moreover, even if, as the petitioner claims, access to courts were
restricted during these times, he could have immediately filed his claim after
Martial Law and after the Cotabato conflict has ended. The petitioner's reliance
on the Court's treatment of Martial Law as force majeure that suspended the