2013 cases- succession

8/12/2019 2013 CASES- Succession

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2013 CASES (DIGEST)

TOPIC: RESERVA TRONCAL

CASE: MENDOZA VS DELOS SANTOS (GR 176422)

FACTS:The subject properties of this case are three parcels of land. Lot 1646-B

is under the name of respondent Julia delos Santos and co-owned by ictoria

!antaleon who bou"ht one-half of the property from petitioner #aria #endo$a

and her siblin"s. !etitioners are "randchildren of !lacido #endo$a %!lacido& and

'omin"a #endo$a %'omin"a&. !lacido and 'omin"a had four children( )ntonio*

+,euiel* married to Leonor* )polonio and alentin. The petitioners are children

of )ntonio and alentin. They alle"ed that !lacido and 'omin"as properties that

were subject of an oral partition and subseuently adjudicated to +,euiel. )fter

+,euiels death* it passed on to his spouse Leonor and only dau"hter* /re"oria.

)fter Leonors death* her share went to /re"oria. 0n 12* /re"oria died intestateand without issue. They claimed that after /re"orias death* respondent* who is

Leonors sister* adjudicated unto herself all these properties as the sole sur3i3in"

heir of Leonor and /re"oria. ence* petitioners claim that the properties shouldha3e been reser3ed by respondent in their behalf and must now re3ert bac5 to

them* applyin" )rticle 1 of the 7i3il 7ode on reser3a troncal. 8espondent*

howe3er* denies any obli"ation to reser3e the properties as these did not ori"inate

from petitioners familial line and were not ori"inally owned by !lacido and

'omin"a. )ccordin" to respondent* the properties were bou"ht by +,euiel and

)ntonio from a certain )lfonso 8amos in 191. 0t appears* howe3er* that it was

only +,euiel who was in possession of the properties. The 8e"ional Trial 7ourt%8T7& of #alolos* Bulacan* Branch 6* found merit in petitioners claim and

"ranted their action for 8eco3ery of !ossession by 8eser3a Troncal. :n appeal*

the 7ourt of )ppeals %7)& re3ersed and set aside the 8T7 decision and dismissed

the complaint filed by petitioners. 0n dismissin" the complaint* the 7) ruled that

petitioners failed to establish that !lacido and 'omin"a owned the properties indispute. 1; The 7) also ruled that e3en assumin" that !lacido and 'omin"a

pre3iously owned the properties* it still cannot be subject to reser3a troncal as

neither +,euiel predeceased !lacido and 'omin"a nor did /re"oria predecease

+,euiel.

ISSUES:whether the properties in dispute are reser3able propertieswhether petitioners are entitled to a reser3ation of these properties.

RULING:

)rticle 1 of the 7i3il 7ode on

reser3a troncal

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The principle of reser3a troncal is pro3ided in )rticle 1 of the 7i3il 7ode(

)rt. 1. The ascendant who inherits from his descendant any property which

the latter may ha3e acuired by "ratuitous title from another ascendant* or a

brother or sister* is obli"ed to reser3e such property as he may ha3e acuired by

operation of law for the benefit of relati3es who are within the third de"ree and

belon" to the line from which said property came. %+mphasis ours&There are three %9& lines of transmission in reser3a troncal. The first transmission

is by "ratuitous title* whether by inheritance or donation* from an

ascendant=brother=sister to a descendant called the prepositus. The second

transmission is by operation of law from the prepositus to the other ascendant or

reser3or* also called the reser3ista. The third and last transmission is from the

reser3ista to the reser3ees or reser3atarios who must be relati3es within the third

de"ree from which the property came. 1> 7+cS0

The lineal character of the

reser3able property is rec5oned

from the ascendant from whom theprepositus recei3ed the property by

"ratuitous title

Based on the circumstances of the present case* )rticle 1 on reser3a troncal isnot applicable.

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The fallacy in the 7)s resolution is that it proceeded from the erroneous premise

that !lacido is the ascendant contemplated in )rticle 1 of the 7i3il 7ode. ?rom

thence* it sou"ht to trace the ori"in of the subject properties bac5 to !lacido and'omin"a* determine whether +,euiel predeceased !lacido and whether /re"oria

predeceased +,euiel.The persons in3ol3ed in reser3a troncal are( 'Tc)7a

%1& The ascendant or brother or sister from whom the property was recei3ed by

the descendant by lucrati3e or "ratuitous title@

%2& The descendant or prepositus %propositus& who recei3ed the property@

%9& The reser3or %reser3ista&* the other ascendant who obtained the property

from the prepositus by operation of law@ and%4& The reser3ee %reser3atario& who is within the third de"ree from the

prepositus and who belon"s to the %linea o tronco& from which the property cameand for whom the property should be reser3ed by the reser3or. 16

0t should be pointed out that the ownership of the properties should be rec5oned

only from +,euiels as he is the ascendant from where the first transmission

occurred* or from whom /re"oria inherited the properties in dispute. The law doesnot "o farther than such ascendant=brother=sister in determinin" the lineal character

of the property. 1A 0t was also immaterial for the 7) to determine whether

+,euiel predeceased !lacido and 'omin"a or whether /re"oria predeceased

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+,euiel. hat is pertinent is that +,euiel owned the properties and he is the

ascendant from whom the properties in dispute ori"inally came. /re"oria* on the

other hand* is the descendant who recei3ed the properties from +,euiel by

"ratuitous title. +c)'T

#oreo3er* )rticle 1 simply reuires that the property should ha3e been acuired

by the descendant or prepositus from an ascendant by "ratuitous or lucrati3e title.) transmission is "ratuitous or by "ratuitous title when the recipient does not "i3e

anythin" in return. 1 )t ris5 of bein" repetitious* what was clearly established in

this case is that the properties in dispute were owned by +,euiel %ascendant&.

)fter his death* /re"oria %descendant=prepositus& acuired the properties as

inheritance.

)scendants* descendants and

collateral relati3es under )rticle

64 of the 7i3il 7ode

)rticle 1 pro3ides that the person obli"ed to reser3e the property should be an

ascendant %also 5nown as the reser3or=reser3ista& of the descendant= prepositus.Julia* howe3er* is not /re"orias ascendant@ rather* she is /re"orias collateral

relati3e.

)rticle 64 of the 7i3il 7ode pro3ides for the series of de"rees amon" ascendantsand descendants* and those who are not ascendants and descendants but come

from a common ancestor* 3i$.( ')+aTS

)rt. 64. ) series of de"rees forms a line* which may be either direct or

collateral.

) direct line is that constituted by the series of de"rees amon" ascendants and

descendants.

) collateral line is that constituted by the series of de"rees amon" persons who arenot ascendants and descendants* but who come from a common ancestor.

%+mphasis and italics ours&

/re"orias ascendants are her parents* +,euiel and Leonor* her "randparents*

"reat-"randparents and so on. :n the other hand* /re"orias descendants* if she

had one* would be her children* "randchildren and "reat-"randchildren. Cot bein"/re"orias ascendants* both petitioners and Julia* therefore* are her collateral

relati3es. 0n determinin" the collateral line of relationship* ascent is made to the

common ancestor and then descent to the relati3e from whom the computation is

made. 0n the case of Julias collateral relationship with /re"oria* ascent is to be

made from /re"oria to her mother Leonor %one line=de"ree&* then to the common

ancestor* that is* Julia and Leonors parents %second line=de"ree&* and then descentto Julia* her aunt %third line=de"ree&. Thus* Julia is /re"orias collateral relati3e

within the third de"ree and not her ascendant. Tc7'+

?irst cousins of the

descendant= prepositus are fourth

de"ree relati3es and cannot be

considered reser3ees=reser3atarios

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#oreo3er* petitioners cannot be considered reser3ees=reser3atarios as they are not

relati3es within the third de"ree of /re"oria from whom the properties came. The

person from whom the de"ree should be rec5oned is the descendant= prepositus D

the one at the end of the line from which the property came and upon whom the

property last re3ol3ed by descent. 1 0t is /re"oria in this case. !etitioners are

/re"orias fourth de"ree relati3es* bein" her first cousins. ?irst cousins of theprepositus are fourth de"ree relati3es and are not reser3ees or reser3atarios. 2;

They cannot e3en claim representation of their predecessors )ntonio and alentin

as )rticle 1 "rants a personal ri"ht of reser3ation only to the relati3es up to the

third de"ree from whom the reser3able properties came. The only reco"ni$ed

e,emption is in the case of nephews and nieces of the prepositus* who ha3e the

ri"ht to represent their ascendants %fathers and mothers& who are the

brothers=sisters of the prepositus and relati3es within the third de"ree. 21 0n

?lorentino 3. ?lorentino* 22 the 7ourt stated( cSa)'7

?ollowin" the order prescribed by law in le"itimate succession* when there are

relati3es of the descendant within the third de"ree* the ri"ht of the nearest relati3e*called reser3atario* o3er the property which the reser3ista %person holdin" it

subject to reser3ation& should return to him* e,cludes that of the one more remote.

The ri"ht of representation cannot be alle"ed when the one claimin" same as areser3atario of the reser3able property is not amon" the relati3es within the third

de"ree belon" to the line from which such property came* inasmuch as the ri"ht

"ranted by the 7i3il 7ode in E)Frticle 11 Enow )rticle 1F is in the hi"hest

de"ree personal and for the e,clusi3e benefit of the desi"nated persons who are the

relati3es* within the third de"ree* of the person from whom the reser3able property

came. Therefore* relati3es of the fourth and the succeedin" de"rees can ne3er be

considered as reser3atarios* since the law does not reco"ni$e them as such.. . . ECFe3ertheless there is ri"ht of representation on the part of reser3atarios who

are within the third de"ree mentioned by law* as in the case of nephews of the

deceased person from whom the reser3able property came. . . . . 29 %+mphasis and

underscorin" ours& S'+T0

The conclusion* therefore* is that while it may appear that the properties arereser3able in character* petitioners cannot benefit from reser3a troncal. ?irst*

because Julia* who now holds the properties in dispute* is not the other ascendant

within the pur3iew of )rticle 1 of the 7i3il 7ode and second* because

petitioners are not /re"orias relati3es within the third de"ree. ence* the 7)s

disposition that the complaint filed with the 8T7 should be dismissed* only on this

point* is correct. 0f at all* what should apply in the distribution of /re"orias estateare )rticles 1;;9 and 1;; of the 7i3il 7ode* which pro3ide(

)rt. 1;;9. 0f there are no descendants* ascendants* ille"itimate children* or a

sur3i3in" spouse* the collateral relati3es shall succeed to the entire estate of the

deceased in accordance with the followin" articles.

)rt. 1;;. Should there be neither brothers nor sisters* nor children of brothers

or sisters* the other collateral relati3es shall succeed to the estate.

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The latter shall succeed without distinction of lines or preference amon" them by

reason of relationship by the whole blood. T)ac0+

Ce3ertheless* the 7ourt is not in the proper position to determine the proper

distribution of /re"orias estate at this point as the cause of action relied upon by

petitioners in their complaint filed with the 8T7 is based solely on reser3a troncal.

?urther* any determination would necessarily entail reception of e3idence on/re"orias entire estate and the heirs entitled thereto* which is best accomplished

in an action filed specifically for that purpose.

) reser3ista acuires ownership of

the reser3able property until the

reser3ation ta5es place or is

e,tin"uished

Before concludin"* the 7ourt ta5es note of a palpable error in the 8T7s

disposition of the case. 0n upholdin" the ri"ht of petitioners o3er the properties* the

8T7 ordered the recon3eyance of the properties to petitioners and the transfer of

the titles in their names. hat the 8T7 should ha3e done* assumin" for ar"umentssa5e that reser3a troncal is applicable* is ha3e the reser3able nature of the property

re"istered on respondents titles. 0n fact* respondent* as reser3ista* has the duty to

reser3e and to annotate the reser3able character of the property on the title. 24 0nreser3a troncal* the reser3ista who inherits from a prepositus* whether by the

latters wish or by operation of law* acuires the inheritance by 3irtue of a title

perfectly transferrin" absolute ownership. )ll the attributes of ownership belon" to

him e,clusi3ely. 2> TacS)+

The reser3or has the le"al title and dominion to the reser3able property but subject

to the resolutory condition that such title is e,tin"uished if the reser3or

predeceased the reser3ee. The reser3or is a usufructuary of the reser3able property.e may alienate it subject to the reser3ation. The transferee "ets the re3ocable and

conditional ownership of the reser3or. The transferees ri"hts are re3o5ed upon the

sur3i3al of the reser3ees at the time of the death of the reser3or but become

indefeasible when the reser3ees predecease the reser3or. 26 %7itations omitted&

0t is when the reser3ation ta5es place or is e,tin"uished* 2A that a reser3atariobecomes* by operation of law* the owner of the reser3able property. 2 0n any

e3ent* the fore"oin" discussion does not detract from the fact that petitioners are

not entitled to a reser3ation of the properties in dispute.

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TOPIC: PARTITION

CASE: VDA. DE FIGURACION VS. FIGURACION-GUERILLA

FACTS: The parties are the heirs of Leandro ?i"uracion %Leandro& who died

intestate in #ay 1>. !etitioner 7arolina is the sur3i3in" spouse. The otherpetitioners D +lena ?i"uracion-)ncheta* ilaria ). ?i"uracion %ilaria&* ?elipa

?i"uracion-#anuel %?elipa&* 6A and the issuance of T7T Co. 42244 in their names.

The le"al debacle of the ?i"uracions started in 14 when ilaria and her a"ents

threatened to demolish the house of +milia who* in retaliation* was prompted to

see5 the partition of Lot Co. A;A as well as Lot Cos. 22 and A;>. The matter

was initially brou"ht before the Iatarun"an" !ambaran"ay* but no amicable

settlement was reached by the parties. 14 :n #ay 29* 14* respondent +miliainstituted the herein 7omplaint 1> for the partition of Lot Cos. 22* A;> and A;A*

annulment of the )ffida3it of Self-)djudication* 'eed of )bsolute Sale and T7T

Co. 42244* recon3eyance of eastern half portion of Lot Co. A;A* uietin" of title

and dama"es.

0n opposition* the petitioners a3erred the followin" special and affirmati3e

defenses( %1& the respondents cause of action had lon" prescribed and that she is

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"uilty of laches hence* now estopped from brin"in" the suit@ %2& T7T Co. 42244 in

the name of ?elipa and ilaria ha3e already attained indefeasibility and

conclusi3eness as to the true owners of Lot Co. A;A@ and %9& an action for partition

is no lon"er tenable because ?elipa and ilaria ha3e already acuired ri"hts

ad3erse to that claimed by respondent +milia and the same amount to a

repudiation of the alle"ed co-ownership. 16 Stca'0RULING:The respondent can compel the

partition of Lot Co. A;A

The first sta"e in an action for partition is the settlement of the issue of ownership.

Such an action will not lie if the claimant has no ri"htful interest in the subject

property. 0n fact* the parties filin" the action are reuired by the 8ules of 7ourt to

set forth in their complaint the nature and the e,tent of their title to the property. 0t

would be premature to effect a partition until and unless the uestion of ownership

is first definitely resol3ed. 9> 0)+c7T

ere* the respondent traces her ownership o3er the eastern half of Lot Co. A;A

from the 'eed of


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Thus* when 7arolina sold the entire Lot Co. A;A on 'ecember 11* 162 to ilaria

and ?elipa without the consent of her co-owner )"ripina* the disposition affected

only 7arolinas pro indi3iso share* and the 3endees* ilaria and ?elipa* acuired

only what corresponds to 7arolinas share. ) co-owner is entitled to sell his

undi3ided share@ hence* a sale of the entire property by one co-owner without the

consent of the other co-owners is not null and 3oid and only the ri"hts of the co-owner=seller are transferred* thereby ma5in" the buyer a co-owner of the property.

4; 0a)+'

)ccordin"ly* the deed of sale e,ecuted by 7arolina in fa3or of ilaria and ?elipa

was a 3alid con3eyance but only insofar as the share of 7arolina in the co-

ownership is concerned. )s 7arolinas successors-in-interest to the property*

ilaria and ?elipa could not acuire any superior ri"ht in the property than what

7arolina is entitled to or could transfer or alienate after partition.

0n a contract of sale of co-owned property* what the 3endee obtains by 3irtue of

such a sale are the same ri"hts as the 3endor had as co-owner* and the 3endee

merely steps into the shoes of the 3endor as co-owner. 41 ilaria and ?elipa didnot acuire the undi3ided portion pertainin" to )"ripina* which has already been

effecti3ely beueathed to respondent +milia as early as Co3ember 2* 161 thru

the 'eed of


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opposition from the petitioners. ilaria also paid realty ta,es on the lot* in behalf

of the respondent* for the years 19-1A. 4> These e3ents indubitably show that

ilaria and ?elipa failed to assert e,clusi3e title in themsel3es ad3ersely to +milia.

Their acts clearly manifest that they reco"ni$ed the subsistence of their co-

ownership with respondent +milia despite the issuance of T7T Co. 42244 in 162.

Their acts constitute an implied reco"nition of the co-ownership which in turnne"ates the presence of a clear notice of repudiation to the respondent. To sustain a

plea of prescription* it must always clearly appear that one who was ori"inally a

joint owner has repudiated the claims of his co-owners* and that his co-owners

were apprised or should ha3e been apprised of his claim of ad3erse and e,clusi3e

ownership before the alle"ed prescripti3e period be"an to run. 46 T+'cS

0n addition* when ilaria and ?elipa re"istered the lot in their names to the

e,clusion of +milia* an implied trust was created by force of law and the two of

them were considered a trustee of the respondents undi3ided share. 4A )s trustees*

they cannot be permitted to repudiate the trust by relyin" on the re"istration. 0n

8in"or 3. 8in"or* 4 the 7ourt had the occasion to e,plain the reason for this rule() trustee who obtains a Torrens title o3er a property held in trust for him by

another cannot repudiate the trust by relyin" on the re"istration. ) Torrens

7ertificate of Title in Joses name did not 3est ownership of the land upon him.The Torrens system does not create or 3est title. 0t only confirms and records title

already e,istin" and 3ested. 0t does not protect a usurper from the true owner. The

Torrens system was not intended to foment betrayal in the performance of a trust.

0t does not permit one to enrich himself at the e,pense of another. here one does

not ha3e a ri"htful claim to the property* the Torrens system of re"istration can

confirm or record nothin". !etitioners cannot rely on the re"istration of the lands

in Joses name nor in the name of the eirs of Jose #. 8in"or* 0nc.* for the wron"result they see5. ?or Jose could not repudiate a trust by relyin" on a Torrens title

he held in trust for his co-heirs. The beneficiaries are entitled to enforce the trust*

notwithstandin" the irre3ocability of the Torrens title. The intended trust must be

sustained. 4 %7itations omitted and emphasis ours& c)a7+

?urther* records do not reflect conclusi3e e3idence showin" the manner ofoccupation and possession e,ercised by ilaria and ?elipa o3er the lot from the

time it was re"istered in their names. The only e3idence of possession e,tant in the

records dates bac5 only to 1> when ilaria and ?elipa declared the lot in their

names for ta,ation purposes. >; !rescription can only produce all its effects when

acts of ownership* or in this case* possession* do not e3ince any doubt as to the

ouster of the ri"hts of the other co-owners. ence* prescription amon" co-ownerscannot ta5e place when acts of ownership e,ercised are 3a"ue or uncertain. >1

#oreo3er* the e3idence relati3e to the possession* as a fact upon which the alle"ed

prescription is based* must be clear* complete and conclusi3e in order to establish

said prescription without any shadow of doubt@ and when upon trial it is not shown

that the possession of the claimant has been ad3erse and e,clusi3e and opposed to

the ri"hts of the others* the case is not one of ownership* and partition will lie. >2

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The petitioners failed to muster adeuate e3idence of possession essential for the

rec5onin" of the 1;-year period for acuisiti3e prescription. 0+c'7a

The e,press disa3owal of the co-ownership did not happen on 'ecember 11* 162

when T7T Co. 42244 was issued but in 14 when ilaria attempted to demolish

+milias house thus e,plicitly e,cludin" her from the co-ownership. 0t was the

only time that ilaria and ?elipa made 5nown their denial of the co-ownership. :nthe same year* the respondent instituted the present complaint for partition@ hence*

the period reuired by law for acuisiti3e period to set in was not met.

)nent laches* the 7ourt finds it una3ailin" in this case in 3iew of the pro,imity of

the period when the co-ownership was e,pressly repudiated and when the herein

complaint was filed. Laches is the ne"li"ence or omission to assert a ri"ht within a

reasonable time* warrantin" a presumption that the party entitled to assert it has

abandoned it or declined to assert it. >9 #ore so* laches is a creation of euity and

its application is controlled by euitable considerations. 0t cannot be used to defeat

justice or perpetrate fraud and injustice. Ceither should its application be used to

pre3ent the ri"htful owners of a property from reco3erin" what has beenfraudulently re"istered in the name of another. >4 +07Sc'

!artition of Lot Co. A;A

Gnder the :ld 7i3il 7ode >> which was then in force at the time of +ulalio and#arcelas marria"e* Lot Co. A;A was their conju"al property. >6 hen #arcela

died* one-half of the lot was automatically reser3ed to +ulalio* the sur3i3in"

spouse* as his share in the conju"al partnership. >A #arcelas ri"hts to the other

half* in turn* were transmitted to her le"itimate child* )"ripina and sur3i3in"

spouse +ulalio. > Gnder )rticle 94 of the :ld 7i3il 7ode* +ulalio was entitled

only to the usufruct of the lot while the na5ed ownership belon"ed to )"ripina.

hen he remarried* +ulalios one half portion of the lot representin" his share inthe conju"al partnership and his usufructuary ri"ht o3er the other half were

brou"ht into his second marria"e with ?austina. >

hen +ulalio died on July 2;* 19;* 1=4 portion of the lot was reser3ed for

?austina as her share in the conju"al partnership. 6; The remainin" 1=4 were

transmitted eually to the widow ?austina and +ulalios children* 7arolina and)"ripina. 61 owe3er* ?austina is only entitled to the usufruct of the third

a3ailable for betterment. 62 0)TaS

The usufructuary of +ulalio o3er the 1=2 portion inherited by )"ripina earlier was

mer"ed with her na5ed ownership. 69 Gpon the death of ?austina* the shares in

Lot Co. A;A which represents her share in the conju"al partnership and her

inheritance from +ulalio were in turn inherited by 7arolina 64 includin" ?austinasusufructuary ri"hts which were mer"ed with 7arolinas na5ed ownership. 6>

7onseuently* )"ripina is entitled to >= portion of Lot Co. A;A while the

remainin" 9= pertains to 7arolina. Thus* when 7arolina sold Lot Co. A;A to

ilaria and ?elipa* the sale affected only 9= portion of the subject lot. Since the

'eed of


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portion shall be inherited by )"ripinas nearest collateral relati3e* 66 who* records

show* is her sister 7arolina.

0n sum* the 7) committed no re3ersible error in holdin" that the respondent is

entitled to ha3e Lot Co. A;A partitioned. The 7) jud"ment must* howe3er* be

modified to conform to the abo3e-discussed apportionment of the lot amon"

7arolina* ilaria* ?elipa and +milia. 'Ta)S

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TOPIC: HEIRS/PARTITION

CASE: INING VS VEGA

FACTS: Leon 8oldan %Leon&* married to 8afaela #ene$ %8afaela&* is the owner

of a 9*12;-suare meter parcel of land %subject property& in Ialibo* )5lan. Leonand 8afaela died without issue. Leon was sur3i3ed by his siblin"s 8omana 8oldan

%8omana& and /re"oria 8oldan 0nin" %/re"oria&* who are now both deceased.

8omana was sur3i3ed by her dau"hter )nunciacion e"a and "randson* herein

respondent Leonardo 8. e"a %Leonardo& %also both deceased&. Leonardo in turn

is sur3i3ed by his wife Lourdes and children 8estonilo 0. e"a* 7rispulo #. e"a*

#ilbuena e"a-8estituto and Lenard e"a* the substituted respondents.

/re"oria* on the other hand* was sur3i3ed by her si, children( petitioners

Cati3idad 0nin"-0bea %Cati3idad&* 'olores 0nin"-8imon %'olores&* )ntipolo* and

!edro@ Jose@ and )mando. Cati3idad is sur3i3ed by +dilberto 0bea* Josefa 0bea*

#artha 0bea* 7armen 0bea* )mparo 0bea-?ernande$* enry 8ui$ and !astor 8ui$.'olores is sur3i3ed by Jesus 8imon* 7esaria 8imon /on$ales and 8emedios

8imon 7ordero. )ntipolo is sur3i3ed by #anuel illanue3a* dau"hter Teodora

illanue3a-?rancisco %Teodora&* 7amilo ?rancisco %7amilo&* )dolfo ?rancisco%)dolfo&* Lucimo ?rancisco* Jr. %Lucimo Jr.&* #ila"ros ?rancisco* 7eledonio

?rancisco* and ermini"ildo ?rancisco %ermini"ildo&. !edro is sur3i3ed by his

wife* +lisa Tan 0nin" and !edro 0nin"* Jr. )mando died without issue. )s for Jose*

it is not clear from the records if he was made party to the proceedin"s* or if he is

ali3e at all.

0n short* herein petitioners* e,cept for 8amon Tres3alles %Tres3alles& and 8oberto

Tajonera %Tajonera&* are /re"orias "randchildren or spouses thereof %/re"oriasheirs&. +ca)7

0n 1A* actin" on the claim that one-half of subject property belon"ed to him as

8omanas sur3i3in" heir* Leonardo filed with the 8e"ional Trial 7ourt %8T7& of

Ialibo* )5lan 7i3il 7ase Co. >2A> 6 for partition* reco3ery of ownership andpossession* with dama"es* a"ainst /re"orias heirs.

n their )nswer with counterclaim* Teodora* 7amilo* )dolfo* Lucimo Jr. and

ermini"ildo claimed that Leonardo had no cause of action a"ainst them@ that they

ha3e become the sole owners of the subject property throu"h Lucimo Sr. who

acuired the same in "ood faith by sale from Juan +nriue$ %+nriue$&* who inturn acuired the same from Leon* and Leonardo was aware of this fact@

RULING:Leon died without issue@ his heirs are his

siblin"s 8omana and /re"oria.

Since Leon died without issue* his heirs are his siblin"s* 8omana and /re"oria*

who thus inherited the property in eual shares. 0n turn* 8omanas and /re"orias

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heirs D the parties herein D became entitled to the property upon the sisters

passin". Gnder )rticle AAA of the 7i3il 7ode* the ri"hts to the succession are

transmitted from the moment of death.

/re"orias and 8omanas heirs are co-

owners of the subject property.

Thus* ha3in" succeeded to the property as heirs of /re"oria and 8omana*petitioners and respondents became co-owners thereof. )s co-owners* they may

use the property owned in common* pro3ided they do so in accordance with the

purpose for which it is intended and in such a way as not to injure the interest of

the co-ownership or pre3ent the other co-owners from usin" it accordin" to their

ri"hts. 9A They ha3e the full ownership of their parts and of the fruits and benefits

pertainin" thereto* and may alienate* assi"n or mort"a"e them* and e3en substitute

another person in their enjoyment* e,cept when personal ri"hts are in3ol3ed. 9

+ach co-owner may demand at any time the partition of the thin" owned in

common* insofar as his share is concerned. 9 ?inally* no prescription shall run in

fa3or of one of the co-heirs a"ainst the others so lon" as he e,pressly or impliedlyreco"ni$es the co-ownership. 4;

?or prescription to set in* the

repudiation must be done by a co-owner.Time and a"ain* it has been held that Ha co-owner cannot acuire by prescription

the share of the other co-owners* absent any clear repudiation of the co-ownership.

0n order that the title may prescribe in fa3or of a co-owner* the followin"

reuisites must concur( %1& the co-owner has performed uneui3ocal acts of

repudiation amountin" to an ouster of the other co-owners@ %2& such positi3e acts

of repudiation ha3e been made 5nown to the other co-owners@ and %9& the e3idence

thereof is clear and con3incin".H 41 a0c'7?rom the fore"oin" pronouncements* it is clear that the trial court erred in

rec5onin" the prescripti3e period within which Leonardo may see5 partition from

the death of Leon in 162. )rticle 1141 and )rticle 44 %fifth para"raph& pro3ide

that prescription shall be"in to run in fa3or of a co-owner and a"ainst the other co-

owners only from the time he positi3ely renounces the co-ownership and ma5es5nown his repudiation to the other co-owners.

Lucimo Sr. challen"ed Leonardos co-ownership of the property only sometime in

1A and 1;* when the former e,ecuted the )ffida3it of :wnership of Land*

obtained a new ta, declaration e,clusi3ely in his name* and informed the latter D

before the Lupon Ta"apamayapa D of his 149 purchase of the property. These

apparent acts of repudiation were followed later on by Lucimo Sr.s act ofwithholdin" Leonardos share in the fruits of the property* be"innin" in 1* as

Leonardo himself claims in his )mended 7omplaint. 7onsiderin" these facts* the

7) held that prescription be"an to run a"ainst Leonardo only in 1A D or e3en

in 1; D when it has been made sufficiently clear to him that Lucimo Sr. has

renounced the co-ownership and has claimed sole ownership o3er the property.

The 7) thus concluded that the filin" of 7i3il 7ase Co. >2A> in 1A* or just

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under 2; years counted from 1A* is clearly within the period prescribed under

)rticle 1141. aS)T+

hat escaped the trial and appellate courts notice* howe3er* is that while it may

be ar"ued that Lucimo Sr. performed acts that may be characteri$ed as a

repudiation of the co-ownership* the fact is* he is not a co-owner of the property.

0ndeed* he is not an heir of /re"oria@ he is merely )ntipolos son-in-law* bein"married to )ntipolos dau"hter Teodora. 42 Gnder the ?amily 7ode* family

relations* which is the primary basis for succession* e,clude relations by affinity.

)rt. 1>;. ?amily relations include those(

%1& Between husband and wife@

%2& Between parents and children@

%9& )mon" other ascendants and descendants@ and

%4& )mon" brothers and sisters* whether of the full or half blood.

0n point of law* therefore* Lucimo Sr. is not a co-owner of the property@ Teodora

is. 7onseuently* he cannot 3alidly effect a repudiation of the co-ownership*

which he was ne3er part of. ?or this reason* prescription did not run ad3erselya"ainst Leonardo* and his ri"ht to see5 a partition of the property has not been lost.

LLphil

Li5ewise* petitioners ar"ument that Leonardos admission and ac5nowled"ment inhis pleadin"s D that Lucimo Sr. was in possession of the property since 149 D

should be ta5en a"ainst him* is una3ailin". 0n 149* Leon remained the ri"htful

owner of the land* and Lucimo Sr. 5new this 3ery well* bein" married to Teodora*

dau"hter of )ntipolo* a nephew of Leon. #ore si"nificantly* the property* which is

re"istered under the Torrens system and co3ered by :7T 8:-69;* is in Leons

name. Leons ownership ceased only in 162* upon his death when the property

passed on to his heirs by operation of law.0n fine* since none of the co-owners made a 3alid repudiation of the e,istin" co-

ownership* Leonardo could see5 partition of the property at any time.

HEIRS OF POLICRONIO M. URETA, SR., na!"#:

CONRADO $. URETA, MACARIO $. URETA,

GLORIA URETA%GON&ALES, ROMEO $.

URETA, RITA URETA%SOLANO, NENA URETA%

TONGCUA, VENANCIO $. URETA, LILIA

URETA%TA'CO, an HEIRS OF POLICRONIO $.URETA, R., na!"#: MIGUEL T. URETA,

RAMON POLICRONIO T. URETA, EMMANUEL

T. URETA, an $ERNADETTE T. URETA,

G.R. N*. 1+-

!etitioners*

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16/145

- 3ersus -

HEIRS OF LI$ERATO M. URETA, na!"#:TERESA F. URETA, AMPARO URETA%

CASTILLO, IGNACIO F. URETA, SR., EMIRITO

F. URETA, ILIE F. URETA, LI$ERATO F.

URETA, R., RA' F. URETA, &ALD' F. URETA,

an MILA EAN URETA CIPRIANO

HEIRS OF PRUDENCIA URETA PARADERO,

na!"#: ILLIAM U. PARADERO, ARLITO U.

PARADERO, CARMENCITA P. PERLAS,

CRISTINA P. CORDOVA, EDNA P. GALLARDO,

LETICIA P. RE'ES NARCISO M. URETAVICENTE M. URETA

HEIRS OF FRANCISCO M. URETA, na!"#:

EDITA T. URETA%RE'ES an LOLLIE T.

URETA%VILLARUEL ROUE M. URETA

ADELA URETA%GON&ALES HEIRS OF

INOCENCIO M. URETA, na!"#: $ENILDA V.

URETA, ALFONSO V. URETA II, DIC

RICARDO V. URETA, an ENRIUE V. URETA

MERLINDA U. RIVERA ORGE URETA

ANDRES URETA, ENEFREDA U. TARAN an$ENEDICT URETA,

8espondents.

, - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - ,

HEIRS OF LI$ERATO M. URETA, na!"#:

TERESA F. URETA, AMPARO URETA%

CASTILLO, IGNACIO F. URETA, SR., EMIRITO

F. URETA, ILIE F. URETA, LI$ERATO F.

URETA, R., RA' F. URETA, &ALD' F. URETA,

an MILA EAN URETA CIPRIANO

HEIRS OF PRUDENCIA URETA PARADERO,

na!"#: ILLIAM U. PARADERO, ARLITO U.

PARADERO, CARMENCITA P. PERLAS,

CRISTINA P. CORDOVA, EDNA P. GALLARDO,

LETICIA P. RE'ES NARCISO M. URETA

VICENTE M. URETA

G.R. N*. 1+430

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HEIRS OF FRANCISCO M. URETA, na!"#:

EDITA T. URETA%RE'ES an LOLLIE T.

URETA%VILLARUEL ROUE M. URETA

ADELA URETA%GON&ALES HEIRS OF

INOCENCIO M. URETA, na!"#: $ENILDA V.URETA, ALFONSO V. URETA II, DIC

RICARDO V. URETA, an ENRIUE V. URETA

MERLINDA U. RIVERA ORGE URETA

ANDRES URETA, ENEFREDA U. TARAN an

$ENEDICT URETA,

!etitioners*

- 3ersus

HEIRS OF POLICRONIO M. URETA, SR.,

na!"#: CONRADO $. URETA, MACARIO $.

URETA, GLORIA URETA%GON&ALES, ROMEO

$. URETA, RITA URETA%SOLANO, NENA

URETA%TONGCUA, VENANCIO $. URETA,

LILIA URETA%TA'CO, an HEIRS OF

POLICRONIO $. URETA, R., na!"#: MIGUELT. URETA, RAMON POLICRONIO T. URETA,

EMMANUEL T. URETA, an $ERNADETTE T.

URETA,

!resent(

+L)S7:* J8.*J., Chairperson*

!+8)LT)*

)B)'*

#+C':K)* and

S+8+C:*JJ.

!romul"ated(

8espondents. S!56!7!8 1, 2011

, - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - ,

D E C I S I O N

MENDO&A,J.:

These consolidated petitions for re3iew on certiorari under 8ule 4> of the

1A 8e3ised 8ules of 7i3il !rocedure assail the )pril 2;* 2;;4 'ecisionE1Fof the

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7ourt of )ppeals (CA)* and its :ctober 14* 2;;4 8esolutionE2Fin 7.).-/.8. 7

Co. A19* which affirmed with modification the )pril 26* 2;;1 'ecisionE9Fof

the 8e"ional Trial 7ourt* Branch * Ialibo* )5lan (RTC)in 7i3il 7ase Co. >;26.

T9! Fa6;

0n his lifetime* )lfonso Greta (Alfonso) be"ot 14 children* namely*

!olicronio* Liberato* Carciso* !rudencia* icente* ?rancisco* 0nocensio* 8oue*

)dela* enefreda* #erlinda* Benedicto* Jor"e* and )ndres. The children of

!olicronio (Heirs of Policronio)* are opposed to the rest of )lfonsoMs children and

their descendants (Heirs of Alfonso).

)lfonso was financially well-off durin" his lifetime. e owned se3eral

fishpens* a fishpond* a sari-sari store* a passen"er jeep* and was en"a"ed in the

buyin" and sellin" of copra. !olicronio* the eldest* was the only child of )lfonso

who failed to finish schoolin" and instead wor5ed on his fatherMs lands.

Sometime in :ctober 16* )lfonso and four of his children* namely*

!olicronio* Liberato* !rudencia* and ?rancisco* met at the house of Liberato.?rancisco* who was then a municipal jud"e* su""ested that in order to reduce the

inheritance ta,es* their father should ma5e it appear that he had sold some of his

lands to his children. )ccordin"ly* )lfonso e,ecuted four %4& 'eeds of Sale

co3erin" se3eral parcels of land in fa3or of !olicronio*E4FLiberato*E>F!rudencia*

E6Fand his common-law wife* aleriana 'ela 7ru$.EAFThe 'eed of Sale e,ecuted

on :ctober 2>* 16* in fa3or of !olicronio* co3ered si, parcels of land* which are

the properties in dispute in this case.

Since the sales were only made for ta,ation purposes and no monetary

consideration was "i3en* )lfonso continued to own* possess and enjoy the lands

and their produce.

hen )lfonso died on :ctober 11* 1A2* Liberato acted as the administrator

of his fatherMs estate. e was later succeeded by his sister !rudencia* and then by

her dau"hter* 7armencita !erlas. +,cept for a portion of parcel >* the rest of the

parcels transferred to !olicronio were tenanted by the ?ernande$ ?amily. These

tenants ne3er turned o3er the produce of the lands to !olicronio or any of his heirs*

but to )lfonso and* later* to the administrators of his estate.

!olicronio died on Co3ember 22* 1A4. +,cept for the said portion of

parcel >* neither !olicronio nor his heirs e3er too5 possession of the subject lands.

:n )pril 1* 1* )lfonsoMs heirs e,ecuted a 'eed of +,tra-Judicial

!artition*EFwhich included all the lands that were co3ered by the four %4& deeds

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of sale that were pre3iously e,ecuted by )lfonso for ta,ation purposes. 7onrado*

!olicronioMs eldest son* representin" the eirs of !olicronio* si"ned the 'eed of

+,tra-Judicial !artition in behalf of his co-heirs.

)fter their fatherMs death* the eirs of !olicronio found ta, declarations in

his name co3erin" the si, parcels of land. :n June 1>* 1>* they obtained a copyof the 'eed of Sale e,ecuted on :ctober 2>* 16 by )lfonso in fa3or of

!olicronio.

Cot lon" after* on July 9;* 1>* the eirs of !olicronio alle"edly learned

about the 'eed of +,tra-Judicial !artition in3ol3in" )lfonsoMs estate when it was

published in the July 1* 1> issue of the )5lan 8eporter.

Belie3in" that the si, parcels of land belon"ed to their late father* and as

such* e,cluded from the 'eed of +,tra-Judicial !artition* the eirs of !olicronio

sou"ht to amicably settle the matter with the eirs of )lfonso. +arnest effortspro3in" futile* the eirs of !olicronio filed a 7omplaint for 'eclaration of

:wnership* 8eco3ery of !ossession* )nnulment of 'ocuments* !artition* and

'ama"esEFa"ainst the eirs of )lfonso before the 8T7 on Co3ember 1A* 1>where the followin" issues were submitted( %1& whether or not the 'eed of Sale

was 3alid@ %2& whether or not the 'eed of +,tra-Judicial !artition was 3alid@ and

%9& who between the parties was entitled to dama"es.

T9! R


20/145

)lfonso in fa3or of his 9 children and second wife for ta,ation purposes@ that

althou"h ta, declarations were issued in the name of !olicronio* he or his heirs

ne3er too5 possession of the subject lands e,cept a portion of parcel >@ and that all

the produce were turned o3er by the tenants to )lfonso and the administrators of

his estate and ne3er to !olicronio or his heirs.

The 8T7 further found that there was no money in3ol3ed in the sale.

+3en "rantin" that there was* as claimed by the eirs of !olicronio* 2*;;;.;; for

si, parcels of land* the amount was "rossly inadeuate. 0t was also noted that the

a""re"ate area of the subject lands was more than double the a3era"e share

adjudicated to each of the other children in the 'eed of +,tra-Judicial !artition@

that the siblin"s of !olicronio were the ones who shared in the produce of the land@

and that the eirs of !olicronio only paid real estate ta,es in 16 and 1A. The

8T7 opined that !olicronio must ha3e been aware that the transfer was merely for

ta,ation purposes because he did not subseuently ta5e possession of the

properties e3en after the death of his father.

The 'eed of +,tra-Judicial !artition* on the other hand* was declared

3alid by the 8T7 as all the heirs of )lfonso were represented and recei3ed eualshares and all the reuirements of a 3alid e,tra-judicial partition were met. The

8T7 considered 7onradoMs claim that he did not understand the full si"nificance

of his si"nature when he si"ned in behalf of his co-heirs* as a "ratutitous assertion.

The 8T7 was of the 3iew that when he admitted to ha3e si"ned all the pa"es and

personally appeared before the notary public* he was presumed to ha3e understood

their contents.

Lastly* neither party was entitled to dama"es. The eirs of )lfonso

failed to present testimony to ser3e as factual basis for moral dama"es* no

document was presented to pro3e actual dama"es* and the eirs of !olicronio

were found to ha3e filed the case in "ood faith.

T9! R


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1.& The 'eed of Sale in fa3or of !olicronio Greta* Sr.*

dated 2> :ctober 16* co3erin" si, %6& parcels of land is

hereby declared VOID for bein" A$SOLUTELY

SIMULATED@

2.& The 'eed of +,tra-Judicial !artition* dated 1)pril 1* isANNULLED@

9.& The claim for actual and e,emplary dama"es areDISMISSEDfor lac5 of factual and le"al basis.

The case is herebyREMANDEDto the court of ori"in

for the proper partition of )L?:CS: G8+T)MS +state in

accordance with 8ule 6 of the 1A 8ules of 7i3il !rocedure.

Co costs at this instance.

S: :8'+8+'.

The 7) affirmed the findin" of the 8T7 that the 'eed of Sale was 3oid. 0t

found the 'eed of Sale to be absolutely simulated as the parties did not intend to

be le"ally bound by it. )s such* it produced no le"al effects and did not alter the

juridical situation of the parties. The 7) also noted that )lfonso continued to

e,ercise all the ri"hts of an owner e3en after the e,ecution of the 'eed of Sale* as

it was undisputed that he remained in possession of the subject parcels of land and

enjoyed their produce until his death.

!olicronio* on the other hand* ne3er e,ercised any ri"hts pertainin" to an

owner o3er the subject lands from the time they were sold to him up until his

death. e ne3er too5 or attempted to ta5e possession of the land e3en after his

fatherMs death* ne3er demanded deli3ery of the produce from the tenants* andne3er paid realty ta,es on the properties. 0t was also noted that !olicronio ne3er

disclosed the e,istence of the 'eed of Sale to his children* as they were* in fact*

surprised to disco3er its e,istence. The 7)* thus* concluded that !olicronio must

ha3e been aware that the transfer was only made for ta,ation purposes.

The testimony of )mparo 7astillo* as to the circumstances surroundin"the actual arran"ement and a"reement between the parties prior to the e,ecution of

the four %4& 'eeds of Sale* was found by the 7) to be unrebutted. The 8T7Ms

assessment of the credibility of her testimony was accorded respect* and the

intention of the parties was "i3en the primary consideration in determinin" the true

nature of the contract.

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7ontrary to the findin" of the 8T7 thou"h* the 7) annulled the 'eed of

+,tra-Judicial !artition due to the incapacity of one of the parties to "i3e his

consent to the contract. 0t held that before 7onrado could 3alidly bind his co-heirs

to the 'eed of +,tra-Judicial !artition* it was necessary that he be clothed with the

proper authority. The 7) ruled that a special power of attorney was reuired under

)rticle 1A %>& and %1>& of the 7i3il 7ode. ithout a special power of attorney*it was held that 7onrado lac5ed the le"al capactiy to "i3e the consent of his co-

heirs* thus* renderin" the 'eed of +,tra-Judicial !artition 3oidable under )rticle

19; %1& of the 7i3il 7ode.

)s a conseuence* the 7) ordered the remand of the case to the 8T7 for the

proper partition of the estate* with the option that the parties may still 3oluntarily

effect the partition by e,ecutin" another a"reement or by adoptin" the assailed

'eed of !artition with the 8T7Ms appro3al in either case. :therwise* the 8T7 may

proceed with the compulsory partition of the estate in accordance with the 8ules.

ith re"ard to the claim for dama"es* the 7) a"reed with the 8T7 and

dismissed the claim for actual and compensatory dama"es for lac5 of factual and

le"al basis.

Both parties filed their respecti3e #otions for 8econsideration* which

were denied by the 7) for lac5 of merit in a 8esolution dated :ctober 14* 2;;4.

0n their #otion for 8econsideration* the eirs of !olicronio ar"ued that the

8T7 3iolated the best e3idence rule in "i3in" credence to the testimony of

)mparo 7astillo with re"ard to the simulation of the 'eed of Sale* and thatprescription had set in precludin" any uestion on the 3alidity of the contract.

The 7) held that the oral testimony was admissible under 8ule 19;*

Section %b& and %c&* which pro3ides that e3idence aliundemay be allowed to

e,plain the terms of the written a"reement if the same failed to e,press the trueintent and a"reement of the parties thereto* or when the 3alidity of the written

a"reement was put in issue. ?urthermore* the 7) found that the eirs of

!olicronio wai3ed their ri"ht to object to e3idence aliundeha3in" failed to do so

durin" trial and for raisin" such only for the first time on appeal. ith re"ard to

prescription* the 7) ruled that the action or defense for the declaration of the

ine,istence of a contract did not prescribe under )rticle 141; of the 7i3il 7ode.

:n the other hand* the eirs of )lfonso ar"ued that the 'eed of +,tra-

Judicial !artition should not ha3e been annulled* and instead the preterited heirs

should be "i3en their share. The 7) reiterated that 7onradoMs lac5 of capacity to

"i3e his co-heirsM consent to the e,tra-judicial settlement rendered the same

3oidable.

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ence* the present !etitions for 8e3iew on 7ertiorari.

T9! I;;

The issues presented for resolution by the eirs of !olicronio in G.R.N*. 1+- are as follows(

I.

9!69!8 69! C* 69a6 69!

D!! *? A7;*"

7*

14+4B 9!69!8 58!;8=56=*n a55"=!; 6* 7a8 an# *""a6!8a"

a66a *n 69! @a"==6# *? 69! !! *? a7;*"


24/145

C*=@! 9=; *%9!=8;

*n;!n6 6* 69! E68a% a8>

9!69!8 *8 n*6 69! C*

seriatim.

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25/145

Two 3eritable le"al presumptions bear on the 3alidity of the 'eed of

Sale( %1& that there was sufficient consideration for the contract@ and %2& that it was

the result of a fair and re"ular pri3ate transaction. 0f shown to hold* these

presumptions inferprima faciethe transactionMs 3alidity* e,cept that it must yield

to the e3idence adduced.E1;F

)s will be discussed below* the e3idence o3ercomes these two

presumptions.

A!solute imulation

?irst* the 'eed of Sale was not the result of a fair and re"ular pri3ate

transaction because it was absolutely simulated.

The eirs of !olicronio ar"ued that the land had been 3alidly soldto !olicronio as the 'eed of Sale contained all the essential elements of a

3alid contract of sale* by 3irtue of which* the subject properties were transferred in

his name as e3idenced by the ta, declaration. There bein" no in3alidation prior tothe e,ecution of the 'eed of +,tra-Judicial !artition* the probity and inte"rity of

the 'eed of Sale should remain undiminished and accorded respect as it was a

duly notari$ed public instrument.

The eirs of !olicronio posited that his loyal ser3ices to his father and his

bein" the eldest amon" )lfonsoMs children* mi"ht ha3e prompted the old man to

sell the subject lands to him at a 3ery low price as an ad3ance inheritance. Theye,plained that !olicronioMs failure to ta5e possession of the subject lands and to

claim their produce manifests a ?ilipino family practice wherein a child would

ta5e possession and enjoy the fruits of the land sold by a parent only after the

latterMs death. !olicronio simply treated the lands the same way his father )lfonso

treated them - where his children enjoyed usufructuary ri"hts o3er the properties*as opposed to appropriatin" them e,clusi3ely to himself. They contended that

!olicronioMs failure to ta5e actual possession of the lands did not pro3e that he was

not the owner as he was merely e,ercisin" his ri"ht to dispose of them. They ar"ue

that it was an error on the part of the 7) to conclude that ownership by !olicronio

was not established by his failure to possess the properties sold. 0nstead* emphasis

should be made on the fact that the ta, declarations* bein" indicia of possession*were in !olicronioMs name.

They further ar"ued that the eirs of )lfonso failed to appreciate that the

'eed of Sale was clear enou"h to con3ey the subject parcels of land. 7itin"

jurisprudence* they contend that there is a presumption that an instrument sets out

the true a"reement of the parties thereto and that it was e,ecuted for 3aluable

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consideration*E11Fand where there is no doubt as to the intention of the parties to a

contract* the literal meanin" of the stipulation shall control.E12FCowhere in the

'eed of Sale is it indicated that the transfer was only for ta,ation purposes. :n the

contrary* the document clearly indicates that the lands were sold. Therefore* they

a3erred that the literal meanin" of the stipulation should control.

The 7ourt disa"rees.

The 7ourt finds no co"ent reason to de3iate from the findin" of the 7)

that the 'eed of Sale is null and 3oid for bein" absolutely simulated. The 7i3il

7ode pro3ides(

)rt. 194>. Simulation of a contract may be absolute or relati3e.

The former ta5es place when the parties do not intend to be

bound at all@ the latter* when the parties conceal their true

a"reement.

)rt. 1946. )n absolutely simulated or fictitious contract is 3oid.

) relati3e simulation* when it does not prejudice a third personand is not intended for any purpose contrary to law* morals*

"ood customs* public order or public policy binds the parties to

their real a"reement.

Valerio ". RefrescaE19F is instructi3e on the matter of simulation of

contracts(

0n absolute simulation* there is a colorable contract but

it has no substance as the parties ha3e no intention to be bound

by it. The main characteristic of an absolute simulation is that

the apparent contract is not really desired or intended to producele"al effect or in any way alter the juridical situation of the

parties. )s a result* an absolutely simulated or fictitious contract

is 3oid* and the parties may reco3er from each other what they

may ha3e "i3en under the contract. owe3er* if the parties state

a false cause in the contract to conceal their real a"reement* the

contract is relati3ely simulated and the parties are still bound bytheir real a"reement. ence* where the essential reuisites of a

contract are present and the simulation refers only to the content

or terms of the contract* the a"reement is absolutely bindin" and

enforceable between the parties and their successors in interest.

Lac5in"* therefore* in an absolutely simulated contract is consent which

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is essential to a 3alid and enforceable contract. E14FThus* where a person* in order

to place his property beyond the reach of his creditors* simulates a transfer of it to

another* he does not really intend to di3est himself of his title and control of the

property@ hence* the deed of transfer is but a sham.E1>FSimilarly* in this case*

)lfonso simulated a transfer to !olicronio purely for ta,ation purposes* without

intendin" to transfer ownership o3er the subject lands.

The primary consideration in determinin" the true nature of a contract is

the intention of the parties. 0f the words of a contract appear to contra3ene the

e3ident intention of the parties* the latter shall pre3ail. Such intention is

determined not only from the e,press terms of their a"reement* but also from the

contemporaneous and subseuent acts of the parties.E16FThe true intention of the

parties in this case was sufficiently pro3en by the eirs of )lfonso.

The eirs of )lfonso established by a preponderance of e3idenceE1AF

that the 'eed of Sale was one of the four %4& absolutely simulated 'eeds of Salewhich in3ol3ed no actual monetary consideration* e,ecuted by )lfonso in fa3or of

his children* !olicronio* Liberato* and !rudencia* and his second wife* aleriana*

for ta,ation purposes.

)mparo 7astillo* the dau"hter of Liberato* testified* to wit(


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29/145

!olicrionio that their father did not ta5e possession of the subject lands or enjoyed

the fruits thereof in deference to a ?ilipino family practice. ad this been true*

!olicronio should ha3e ta5en possession of the subject lands after his father died.

:n the contrary* it was admitted that neither !olicronio nor his heirs e3er too5

possession of the subject lands from the time they were sold to him* and e3en after

the death of both )lfonso and !olicronio.

0t was also admitted by the eirs of !olicronio that the tenants of the

subject lands ne3er turned o3er the produce of the properties to !olicronio or his

heirs but only to )lfonso and the administrators of his estate. Ceither was there a

demand for their deli3ery to !olicronio or his heirs. Ceither did !olicronio e3er

pay real estate ta,es on the properties* the only payment on record bein" those

made by his heirs in 16 and 1A ten years after his death. 0n sum* !olicronio

ne3er e,ercised any ri"hts pertainin" to an owner o3er the subject lands.

The most protuberant inde, of simulation of contract is the completeabsence of an attempt in any manner on the part of the ostensible buyer to assert

ri"hts of ownership o3er the subject properties. !olicronioMs failure to ta5e

e,clusi3e possession of the subject properties or* in the alternati3e* to collectrentals* is contrary to the principle of ownership. Such failure is a clear bad"e of

simulation that renders the whole transaction 3oid.E2;F

0t is further tellin" that !olicronio ne3er disclosed the e,istence of the

'eed of Sale to his children. This* coupled with !olicronioMs failure to e,ercise

any ri"hts pertainin" to an owner of the subject lands* leads to the conclusion that

he was aware that the transfer was only made for ta,ation purposes and ne3erintended to bind the parties thereto.

)s the abo3e factual circumstances remain unrebutted by the eirs of

!olicronio* the factual findin"s of the 8T7* which were affirmed by the 7)*

remain bindin" and conclusi3e upon this 7ourt.E21F

0t is clear that the parties did not intend to be bound at all* and as such*

the 'eed of Sale produced no le"al effects and did not alter the juridical situation

of the parties. The 'eed of Sale is* therefore* 3oid for bein" absolutely simulated

pursuant to )rticle 14; %2& of the 7i3il 7ode which pro3ides(

)rt. 14;. The followin" contracts are ine,istent and 3oid from

the be"innin"(

, , ,

%2& Those which are absolutely simulated or fictitious@

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, , ,

?or "uidance* the followin" are the most fundamental characteristics of

3oid or ine,istent contracts(

1& )s a "eneral rule* they produce no le"al effects whatsoe3er in

accordance with the principle Huod nullum est nullum

producit effectum.H

2& They are not susceptible of ratification.

9& The ri"ht to set up the defense of ine,istence or absolute

nullity cannot be wai3ed or renounced.

4& The action or defense for the declaration of their ine,istenceor absolute nullity is imprescriptible.

>& The ine,istence or absolute nullity of a contract cannot bein3o5ed by a person whose interests are not directly

affected.E22F

Since the 'eed of Sale is 3oid* the subject properties were properly

included in the 'eed of +,tra-Judicial !artition of the estate of )lfonso.

A!sence and #nade$uacy of Consideration

The second presumption is rebutted by the lac5 of consideration for the

'eed of Sale.

0n their )nswer*E29Fthe eirs of )lfonso initially ar"ued that the 'eedof Sale was 3oid for lac5 of consideration* and e3en "rantin" that there was

consideration* such was inadeuate. The eirs of !olicronio counter that the

defenses of absence or inadeuacy of consideration are not "rounds to render a

contract 3oid.

The eirs of !olicronio contended that under )rticle 14A; of the 7i3il7ode* "ross inadeuacy of the price does not affect a contract of sale* e,cept as it

may indicate a defect in the consent* or that the parties really intended a donation

or some other act or contract. 7itin" jurisprudence* they ar"ued that inadeuacy of

monetary consideration does not render a con3eyance ine,istent as liberality may

be sufficient cause for a 3alid contract* whereas fraud or bad faith may render it

either rescissible or 3oidable* althou"h 3alid until annulled.E24FThus* they ar"ued

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that if the contract suffers from inadeuate consideration* it remains 3alid until

annulled* and the remedy of rescission calls for judicial inter3ention* which

remedy the eirs of )lfonso failed to ta5e.

0t is further ar"ued that e3en "rantin" that the sale of the subject lands for

a consideration of 2*;;;.;; was inadeuate* absent any e3idence of the fair mar5et 3alue of the land at the time of its sale* it cannot be concluded that the

price at which it was sold was inadeuate.E2>F)s there is nothin" in the records to

show that the eirs of )lfonso supplied the true 3alue of the land in 16* the

amount of 2*;;;.;; must thus stand as its saleable 3alue.

:n this issue* the 7ourt finds for the eirs of )lfonso.

?or lac5 of consideration* the 'eed of Sale is once a"ain found to be

3oid. 0t states that !olicronio paid* and )lfonso recei3ed* the 2*;;;.;; purchase

price on the date of the si"nin" of the contract(

That 0* )L?:CS: ?. G8+T)* , , , for and in

consideration of the sum of T: T:GS)C' % 2*;;;.;;& !+S:S* !hilippine 7urrency* to me in hand 5a= by

!:L078:C0: #. G8+T)* , , ,* do hereby 7+'+*

T8)CS?+8* and 7:C+O* by way of absolute sale* , , , si,

%6& parcels of land , , ,.E26F E+mphasis oursF

)lthou"h* on its face* the 'eed of Sale appears to be supported by 3aluableconsideration* the 8T7 found that there was no money in3ol3ed in the sale. E2AF

This findin" was affirmed by the 7) in rulin" that the sale is 3oid for bein"

absolutely simulated. 7onsiderin" that there is no co"ent reason to de3iate from

such factual findin"s* they are bindin" on this 7ourt.

0t is well-settled in a lon" line of cases that where a deed of sale states that

the purchase price has been paid but in fact has ne3er been paid* the deed of sale is

null and 3oid for lac5 of consideration.E2FThus* althou"h the contract states that

the purchase price of 2*;;;.;; was paid by !olicronio to )lfonso for the subject

properties* it has been pro3en that such was ne3er in fact paid as there was no

money in3ol3ed. 0t must* therefore* follow that the 'eed of Sale is 3oid for lac5 ofconsideration.

/i3en that the 'eed of Sale is 3oid* it is unnecessary to discuss the issue

on the inadeuacy of consideration.

Parol %"idence and Hearsay

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The eirs of !olicronio a3er that the rules on parol e3idence and hearsay

were 3iolated by the 7) in rulin" that the 'eed of Sale was 3oid.

They ar"ued that based on the parol e3idence rule* the eirs of )lfonso

and* specifically* )mparo 7astillo* were not in a position to pro3e the termsoutside of the contract because they were not parties nor successors-in-interest in

the 'eed of Sale in uestion. Thus* it is ar"ued that the testimony of )mparo

7astillo 3iolates the parol e3idence rule.

Stemmin" from the presumption that the eirs of )lfonso were not

parties to the contract* it is also ar"ued that the parol e3idence rule may not be

properly in3o5ed by either party in the liti"ation a"ainst the other* where at least

one of the parties to the suit is not a party or a pri3y of a party to the written

instrument in uestion and does not base a claim on the instrument or assert a ri"ht

ori"inatin" in the instrument or the relation established thereby.E2F

Their ar"uments are untenable.

The objection a"ainst the admission of any e3idence must be made at the

proper time* as soon as the "rounds therefor become reasonably apparent* and if

not so made* it will be understood to ha3e been wai3ed. 0n the case of testimonial

e3idence* the objection must be made when the objectionable uestion is as5ed or

after the answer is "i3en if the objectionable features become apparent only by

reason of such answer.E9;F0n this case* the eirs of !olicronio failed to timely

object to the testimony of )mparo 7astillo and they are* thus* deemed to ha3ewai3ed the benefit of the parol e3idence rule.

/rantin" that the eirs of !olicronio timely objected to the testimony of

)mparo 7astillo* their ar"ument would still fail.

Section of 8ule 19; of the 8ules of 7ourt pro3ides(

Section . +3idence of written a"reements. D hen the terms

of an a"reement ha3e been reduced to writin"* it is considered

as containin" all the terms a"reed upon and there can be*

between the parties and their successors in interest* no e3idence

of such terms other than the contents of the written a"reement.

owe3er* a party may present e3idence to modify* e,plain or

add to the terms of written a"reement if he puts in issue in his

pleadin"(

%a& )n intrinsic ambi"uity* mista5e or imperfection in the

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written a"reement@

(!) The failure of the &ritten a'reement to epress the true

intent and a'reement of the parties thereto

(c) The "alidity of the &ritten a'reement or

%d& The e,istence of other terms a"reed to by the parties or their

successors in interest after the e,ecution of the written

a"reement.

The term Ha"reementH includes wills.

E+mphasis oursF

!ara"raphs %b& and %c& are applicable in the case at bench.

The failure of the 'eed of Sale to e,press the true intent and a"reementof the parties was clearly put in issue in the )nswerE91Fof the eirs of )lfonso to

the 7omplaint. 0t was alle"ed that the 'eed of Sale was only made to lessen the

payment of estate and inheritance ta,es and not meant to transfer ownership. The

e,ception in para"raph %b& is allowed to enable the court to ascertain the true intent

of the parties* and once the intent is clear* it shall pre3ail o3er what the document

appears to be on its face.E92F)s the true intent of the parties was duly pro3en inthe present case* it now pre3ails o3er what appears on the 'eed of Sale.

The 3alidity of the 'eed of Sale was also put in issue in the )nswer* and

was precisely one of the issues submitted to the 8T7 for resolution. E99F The

operation of the parol e3idence rule reuires the e,istence of a 3alid written

a"reement. 0t is* thus* not applicable in a proceedin" where the 3alidity of sucha"reement is the fact in dispute* such as when a contract may be 3oid for lac5 of

consideration.E94F 7onsiderin" that the 'eed of Sale has been shown to be 3oid

for bein" absolutely simulated and for lac5 of consideration* the eirs of )lfonso

are not precluded from presentin" e3idence to modify* e,plain or add to the terms

of the written a"reement.

The eirs of !olicronio must be in a state of confusion in ar"uin" that the

eirs of )lfonso may not uestion the 'eed of Sale for not bein" parties or

successors-in-interest therein on the basis that the parol e3idence rule may not be

properly in3o5ed in a proceedin" or liti"ation where at least one of the parties to

the suit is not a party or a pri3y of a party to the written instrument in uestion and

does not base a claim on the instrument or assert a ri"ht ori"inatin" in theinstrument or the relation established thereby. 0f their ar"ument was to be

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accepted* then the eirs of !olicronio would themsel3es be precluded from

in3o5in" the parol e3idence rule to e,clude the e3idence of the eirs of )lfonso.

0ndeed* the applicability of the parol e3idence rule reuires that the case

be between parties and their successors-in-interest.E9>F0n this case* both the eirs

of )lfonso and the eirs of !olicronio are successors-in-interest of the parties tothe 'eed of Sale as they claim ri"hts under )lfonso and !olicronio* respecti3ely.

The parol e3idence rule e,cludin" e3idence aliunde* howe3er* still cannot apply

because the present case falls under two e,ceptions to the rule* as discussed abo3e.

ith respect to hearsay* the eirs of !olicronio contended that the rule

on hearsay was 3iolated when the testimony of )mparo 7astillo was "i3en wei"ht

in pro3in" that the subject lands were only sold for ta,ation purposes as she was a

person alien to the contract. +3en "rantin" that they did not object to her testimony

durin" trial* they ar"ued that it should not ha3e been appreciated by the 7)

because it had no probati3e 3alue whatsoe3er.E96F

The 7ourt disa"rees.

0t has indeed been held that hearsay e3idence whether objected to or not

cannot be "i3en credence for ha3in" no probati3e 3alue.E9AF This principle*

howe3er* has been rela,ed in cases where* in addition to the failure to object to the

admissibility of the subject e3idence* there were other pieces of e3idence

presented or there were other circumstances pre3ailin" to support the fact in issue.

0n Top*+eld anufacturin', #nc. ". %C%D .A.,E9Fthis 7ourt held(

earsay e3idence alone may be insufficient to

establish a fact in an injunction suit %!ar5er 3. ?urlon"* 62 !.

4;& but* when no objection is made thereto* it is* li5e any other

e3idence* to be considered and "i3en the importance it deser3es.

%Smith 3. 'elaware P )tlantic Tele"raph P Telephone 7o.* >1) 464&. )lthou"h we should warn of the undesirability of

issuin" jud"ments solely on the basis of the affida3its

submitted* where as here* said affida3its are o3erwhelmin"*

uncontro3erted by competent e3idence and not inherently

improbable* we are constrained to uphold the alle"ations of the

respondents re"ardin" the multifarious 3iolations of thecontracts made by the petitioner.

0n the case at bench* there were other pre3ailin" circumstances which

corroborate the testimony of )mparo 7astillo.-irst* the other 'eeds of Sale which

were e,ecuted in fa3or of Liberato* !rudencia* and aleriana on the same day as

that of !olicronioMs were all presented in e3idence. econd* all the properties

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subject therein were included in the 'eed of +,tra-Judicial !artition of the estate

of )lfonso. Third* !olicronio* durin" his lifetime* ne3er e,ercised acts of

ownership o3er the subject properties %as he ne3er demanded or too5 possession of

them* ne3er demanded or recei3ed the produce thereof* and ne3er paid real estate

ta,es thereon&.-ourth* !olicronio ne3er informed his children of the sale.

)s the eirs of !olicronio failed to contro3ert the e3idence presented*

and to timely object to the testimony of )mparo 7astillo* both the 8T7 and the

7) correctly accorded probati3e wei"ht to her testimony.

Prior Action nnecessary

The eirs of !olicronio a3erred that the eirs of )lfonso should ha3e

filed an action to declare the sale 3oid prior to e,ecutin" the 'eed of +,tra-

Judicial !artition. They ar"ued that the sale should enjoy the presumption of

re"ularity* and until o3erturned by a court* the eirs of )lfonso had no authorityto include the land in the in3entory of properties of )lfonsoMs estate. By doin" so*

they arro"ated upon themsel3es the power of in3alidatin" the 'eed of Sale which

is e,clusi3ely 3ested in a court of law which* in turn* can rule only upon theobser3ance of due process. Thus* they contended that prescription* laches* or

estoppel ha3e set in to militate a"ainst assailin" the 3alidity of the sale.

The eirs of !olicronio are mista5en.

) simulated contract of sale is without any cause or consideration* and is*

therefore* null and 3oid@ in such case* no independent action to rescind or annulthe contract is necessary* and it may be treated as non-e,istent for all purposes.

E9F) 3oid or ine,istent contract is one which has no force and effect from the

be"innin"* as if it has ne3er been entered into* and which cannot be 3alidated

either by time or ratification. ) 3oid contract produces no effect whatsoe3er either

a"ainst or in fa3or of anyone@ it does not create* modify or e,tin"uish the juridicalrelation to which it refers.E4;FTherefore* it was not necessary for the eirs of

)lfonso to first file an action to declare the nullity of the 'eed of Sale prior to

e,ecutin" the 'eed of +,tra-Judicial !artition.

Personality to /uestion ale

The eirs of !olicronio contended that the eirs of )lfonso are notparties* heirs* or successors-in-interest under the contemplation of law to clothe

them with the personality to uestion the 'eed of Sale. They ar"ued that under

)rticle 1911 of the 7i3il 7ode* contracts ta5e effect only between the parties* their

assi"ns and heirs. Thus* the "enuine character of a contract which personally binds

the parties cannot be put in issue by a person who is not a party thereto. They

posited that the eirs of )lfonso were not parties to the contract@ neither did they

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appear to be beneficiaries by way of assi"nment or inheritance. Gnli5e themsel3es

who are direct heirs of !olicronio* the eirs of )lfonso are not )lfonsoMs direct

heirs. ?or the eirs of )lfonso to ualify as parties* under )rticle 1911 of the

7i3il 7ode* they must first pro3e that they are either heirs or assi"nees. Bein"

neither* they ha3e no le"al standin" to uestion the 'eed of Sale.

They further ar"ued that the sale cannot be assailed for bein" barred

under )rticle 1421 of the 7i3il 7ode which pro3ides that the defense of ille"ality

of a contract is not a3ailable to third persons whose interests are not directly

affected.

)"ain* the 7ourt disa"rees.

)rticle 1911 and )rticle 1421 of the 7i3il 7ode pro3ide(

)rt. 1911. 7ontracts ta5e effect only between the parties* theirassi"ns and heirs* , , ,

)rt. 1421. The defense of ille"ality of contracts is not a3ailableto third persons whose interests are not directly affected.

The ri"ht to set up the nullity of a 3oid or non-e,istent contract is not

limited to the parties* as in the case of annullable or 3oidable contracts@ it is

e,tended to third persons who are directly affected by the contract. Thus* where a

contract is absolutely simulated* e3en third persons who may be prejudiced

thereby may set up its ine,istence.E41FThe eirs of )lfonso are the children of)lfonso* with his deceased children represented by their children %)lfonsoMs

"randchildren&. The eirs of )lfonso are clearly his heirs and successors-in-

interest and* as such* their interests are directly affected* thereby "i3in" them the

ri"ht to uestion the le"ality of the 'eed of Sale.

#napplica!ility of Article 012

The eirs of !olicronio further ar"ued that e3en assumin" that the eirs

of )lfonso ha3e an interest in the 'eed of Sale* they would still be precluded from

uestionin" its 3alidity. They posited that the eirs of )lfonso must first pro3e

that the sale of )lfonsoMs properties to !olicronio substantially diminished theirsuccessional ri"hts or that their le"itimes would be unduly prejudiced* considerin"

that under )rticle 42 of the 7i3il 7ode* one who has compulsory heirs may

dispose of his estate pro3ided that he does not contra3ene the pro3isions of the

7i3il 7ode with re"ard to the le"itime of said heirs. a3in" failed to do so* they

ar"ued that the eirs of )lfonso should be precluded from uestionin" the 3alidity

of the 'eed of Sale.

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Still* the 7ourt disa"rees.

)rticle 42 of the 7i3il 7ode pro3ides(

)rt. 42. :ne who has no compulsory heirs may dispose by willof all his estate or any part of it in fa3or of any person ha3in"

capacity to succeed.

:ne who has compulsory heirs may dispose of his estate

pro3ided he does not contra3ene the pro3isions of this 7ode

with re"ard to the le"itime of said heirs.

This article refers to the principle of freedom of disposition by will. hat

is in3ol3ed in the case at bench is not a disposition by will but by 'eed of Sale.

ence* the eirs of )lfonso need not first pro3e that the disposition substantiallydiminished their successional ri"hts or unduly prejudiced their le"itimes.

#napplica!ility of Article 3132

The eirs of !olicronio contended that e3en assumin" that the contract

was simulated* the eirs of )lfonso would still be barred from reco3erin" the

properties by reason of )rticle 1412 of the 7i3il 7ode* which pro3ides that if the

act in which the unlawful or forbidden cause does not constitute a criminal

offense* and the fault is both on the contractin" parties* neither may reco3er what

he has "i3en by 3irtue of the contract or demand the performance of the otherMsunderta5in". )s the eirs of )lfonso alle"ed that the purpose of the sale was to

a3oid the payment of inheritance ta,es* they cannot ta5e from the eirs of

!olicronio what had been "i3en to their father.

:n this point* the 7ourt a"ain disa"rees.

)rticle 1412 of the 7i3il 7ode is as follows(

)rt. 1412. 0f the act in which the unlawful or forbidden cause

consists does not constitute a criminal offense* the followin"

rules shall be obser3ed(

%1& hen the fault is on the part of both contractin" parties*

neither may reco3er what he has "i3en by 3irtue of the

contract* or demand the performance of the otherMs

underta5in"@

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%2& hen only one of the contractin" parties is at fault* he

cannot reco3er what he has "i3en by reason of the contract*

or as5 for the fulfillment of what has been promised him.

The other* who is not at fault* may demand the return of

what he has "i3en without any obli"ation to comply with

his promise.

)rticle 1412 is not applicable to fictitious or simulated contracts* because

they refer to contracts with an ille"al cause or subject-matter.E42F This article

presupposes the e,istence of a cause* it cannot refer to fictitious or simulated

contracts which are in reality non-e,istent.E49F)s it has been determined that the

'eed of Sale is a simulated contract* the pro3ision cannot apply to it.

/rantin" that the 'eed of Sale was not simulated* the pro3ision would

still not apply. Since the subject properties were included as properties of )lfonso

in the 'eed of +,tra-Judicial !artition* they are co3ered by correspondin"inheritance and estate ta,es. Therefore* ta, e3asion* if at all present* would not

arise* and )rticle 1412 would a"ain be inapplicable.

Prescription

?rom the position that the 'eed of Sale is 3alid and not 3oid* the eirs of

!olicronio ar"ued that any uestion re"ardin" its 3alidity should ha3e been

initiated throu"h judicial process within 1; years from its notari$ation in

accordance with )rticle 1144 of the 7i3il 7ode. Since 21 years had already

elapsed when the eirs of )lfonso assailed the 3alidity of the 'eed of Sale in16* prescription had set in. ?urthermore* since the eirs of )lfonso did not see5

to nullify the ta, declarations of !olicronio* they had impliedly acuiesced and

"i3en due reco"nition to the eirs of !olicronio as the ri"htful inheritors and

should* thus* be barred from layin" claim on the land.

The eirs of !olicronio are mista5en.

)rticle 141; of the 7i3il 7ode pro3ides(

)rt. 141;. The action for the declaration of the ine,istence of a

contract does not prescribe.

This is one of the most fundamental characteristics of 3oid or ine,istent

contracts.E44F

)s the 'eed of Sale is a 3oid contract* the action for the declaration of its

nullity* e3en if filed 21 years after its e,ecution* cannot be barred by prescription

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for it is imprescriptible. ?urthermore* the ri"ht to set up the defense of ine,istence

or absolute nullity cannot be wai3ed or renounced.E4>FTherefore* the eirs of

)lfonso cannot be precluded from settin" up the defense of its ine,istence.

Validity of the Deed of %tra*Judicial Partition

The 7ourt now resol3es the issue of the 3alidity of the 'eed of +,tra-

Judicial !artition.

nenforcea!ility

The eirs of )lfonso ar"ued that the 7) was mista5en in annullin" the

'eed of +,tra-Judicial !artition due to the incapacity of 7onrado to "i3e the

consent of his co-heirs for lac5 of a special power of attorney. They contended

that what was in3ol3ed was not the capacity to "i3e consent in behalf of the co-

heirs but the authority to represent them. They ar"ue that the 'eed of +,tra-Judicial !artition is not a 3oidable or an annullable contract under )rticle 19; of

the 7i3il 7ode* but rather* it is an unenforceable or* more specifically* an

unauthori$ed contract under )rticles 14;9 %1& and 191A of the 7i3il 7ode. )ssuch* the 'eed of +,tra-Judicial !artition should not be annulled but only be

rendered unenforceable a"ainst the siblin"s of 7onrado.

They further ar"ued that under )rticle 191A of the 7i3il 7ode* when the

persons represented without authority ha3e ratified the unauthori$ed acts* the

contract becomes enforceable and bindin". They contended that the eirs of

!olicronio ratified the 'eed of +,tra-Judicial !artition when 7onrado too5possession of one of the parcels of land adjudicated to him and his siblin"s* and

when another parcel was used as collateral for a loan entered into by some of the

eirs of !olicronio. The 'eed of +,tra-Judicial !artition ha3in" been ratified and

its benefits accepted* the same thus became enforceable and bindin" upon them.

The eirs of )lfonso a3erred that "rantin" ar"uendo that 7onrado was

not authori$ed to represent his co-heirs and there was no ratification* the 7)

should not ha3e remanded the case to the 8T7 for partition of )lfonsoMs estate.

They ar"ued that the 7) should not ha3e applied the 7i3il 7ode "eneral pro3ision

on contracts* but the special pro3isions dealin" with succession and partition. They

contended that contrary to the rulin" of the 7)* the e,tra-judicial parition was notan act of strict dominion* as it has been ruled that partition of inherited land is not

a con3eyance but a confirmation or ratification of title or ri"ht to the land. E46F

Therefore* the law reuirin" a special power of attorney should not be applied to

partitions.

:n the other hand* the eirs of !olicronio insisted that the 7)

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pronouncement on the in3alidity of the 'eed of +,tra-Judicial !artition should not

be disturbed because the subject properties should not ha3e been included in the

estate of )lfonso* and because 7onrado lac5ed the written authority to represent

his siblin"s. They ar"ued with the 7) in rulin" that a special power of attorney

was reuired before 7onrado could si"n in behalf of his co-heirs.

The eirs of !olicronio denied that they ratified the 'eed of +,tra-

Judicial !artition. They claimed that there is nothin" on record that establishes that

they ratified the partition. ?ar from doin" so* they precisely uestioned its

e,ecution by filin" a complaint. They further ar"ued that under )rticle 14; %9& of

the 7i3il 7ode* ratification cannot be in3o5ed to 3alidate the ille"al act of

includin" in the partition those properties which do not belon" to the estate as it

pro3ides another mode of acuirin" ownership not sanctioned by law.

?urthermore* the eirs of !olicronio contended that the defenses of

unenforceability* ratification* and preterition are bein" raised for the first time onappeal by the eirs of )lfonso. ?or ha3in" failed to raise them durin" the trial* the

eirs of )lfonso should be deemed to ha3e wai3ed their ri"ht to do so.

The 7ourt a"rees in part with the eirs of )lfonso.

To be"in* althou"h the defenses of unenforceability* ratification and

preterition were raised by the eirs of )lfonso for the first time on appeal* they

are concomitant matters which may be ta5en up. )s lon" as the uestioned items

bear rele3ance and close relation to those specifically raised* the interest of justice

would dictate that they* too* must be considered and resol3ed. The rule that onlytheories raised in the initial proceedin"s may be ta5en up by a party thereto on

appeal should refer to independent* not concomitant matters* to support or oppose

the cause of action.E4AF

0n the 8T7* the eirs of !olicronio alle"ed that 7onradoMs consent was3itiated by mista5e and undue influence* and that he si"ned the 'eed of +,tra-

Judicial !artition without the authority or consent of his co-heirs.

The 8T7 found that 7onradoMs credibility had faltered* and his claims

were rejected by the 8T7 as "ratuitous assertions. :n the basis of such* the 8T7

ruled that 7onrado duly represented his siblin"s in the 'eed of +,tra-Judicial!artition.

:n the other hand* the 7) annulled the 'eed of +,tra-Judicial !artition

under )rticle 19; %1& of the 7i3il 7ode* holdin" that a special power of attorney

was lac5in" as reuired under )rticle 1A %>& and %1>& of the 7i3il 7ode. These

articles are as follows(

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)rt. 1A. Special powers of attorney are necessary in the

followin" cases(

, , ,

%>& To enter into any contract by which the ownership of animmo3able is transmitted or acuired either "ratuitously or for a

3aluable consideration@

, , ,

%1>& )ny other act of strict dominion.

)rt. 19;. The followin" contracts are 3oidable or annullable*

e3en thou"h there may ha3e been no dama"e to the contractin"

parties(

%1& Those where one of the parties is incapable of "i3in"

consent to a contract@

%2& Those where the consent is 3itiated by mista5e* 3iolence*

intimidation* undue influence or fraud.

These contracts are bindin"* unless they are annulled by a

proper action in court. They are susceptible of ratification.

This 7ourt finds that )rticle 1A %>& and %1>& is inapplicable to the caseat bench. 0t has been held in se3eral casesE4Fthat partition amon" heirs is not

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