FIRST MARBELLA CONDOMINIUM   G.R. No. 163196ASSOCIATION, INC.,                                 Petitioner,   Present:         YNARES-SANTIAGO, J.,              Chairperson,    AUSTRIA-MARTINEZ,                         - versus -   CHICO-NAZARIO,    NACHURA, and    REYES, JJ.          AUGUSTO GATMAYTAN,   Promulgated:                             Respondent.     July 4, 2008

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D E C I S I O N  

AUSTRIA-MARTINEZ, J.:

 

            From the January 7, 2004 Order[1] of the Regional Trial Court (RTC), Pasay City, denying the request of

First MarbellaCondominium Association, Inc. (petitioner) for extrajudicial foreclosure

against Augusto Gatmaytan (respondent); and the March 31, 2004 RTC Order,[2] denying petitioner's Motion for

Reconsideration, the latter filed directly with this Court a Petition for Review onCertiorari under Rule 45 of the Rules of

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

 

            The factual antecedents are as follows.

 

            Respondent is the registered owner of Fontavilla No. 501 (condominium unit), Marbella I

Condominium, Roxas Boulevard, PasayCity, under Condominium Certificate of Title No. 1972 (CCT No. 1972).

[4]  Inscribed on his title is a Declaration of Restrictions, to wit: 

                Entry No. 65370/T-20065 – DECLARATONS OF RESTRICTIONS - executed by the herein registered owner, is hereon annotated restrictions shall be deemed to run with the land, the bldg. & other improvements making up the project, shall constitute lien upon the project, and each unit and shall inure to the benefit of, and be binding upon all units owners, purchasers, interchangeably or sometimes referred to in this Master of Deed with Dec. of Restrictions as occupant, [sic] or holding any w/o [sic] or any right or interest therein or in the project, pursuant to the prov. of the condominium act or other pertinent laws. See restrictions and conditions imposed on Doc. No. 114, Page 24, Bk. I, s. of 1974 of the Not. Pub. for Rizal, M. Perez, Cardenas among w/c are those dealing on scope & coverage; Management Body; repair, alteration et [sic] assessment real property of restrictions & bldg. rules & waivers rights and assignee, tenants occupants of unit validity,[sic] amendment of declaration dated March 19, 1974.Date of inscription May 9, 1979 – 3:02 p.m.[5]    (Emphasis supplied.)

 

            Also inscribed is a Notice of Assessment, which states: 

            Entry No. 96-2466/CCT No. 1972 -NOTICE OF ASSESSMENT – Executed by MILAGROS D. CUBACUB in her capacity as Vice-President/ Administrator of FIRST MARBELLA CONDOMINIUM ASSOCIATION, INC. (FMCAI) [herein petitioner], stating among other things that the condominium unit, described herein has an outstanding dues with the FMCAI in the sum of P775,786.17, inclusive of interests, penalties and attorney's fees, which aforementioned liabilities constitute as first lien against this condominium unit pursuant to the Master Deed of Restrictions. (Doc. No. 34; Page No. 7; Book No. III; Series of 1996 before Notary Public Jose A. Suing, Notary Public for Quezon City).Date of Instrument – March 27, 1996.                             Date of Inscription – May 3, 1996 – 2:10 p.m.[6]

 

            On November 11, 2003, petitioner filed with the RTC, through the Office of the Clerk of Court & Ex-

Oficio Sheriff, a Petition[7]for extrajudicial foreclosure of the condominium unit of respondent, alleging that it (petitioner) is a

duly organized association of the tenants and homeowners of Marbella I Condominium; that respondent is a member thereof

but has unpaid association dues amounting toP3,229,104.89, as  of June 30, 2003; and  that the latter refused to pay his dues

despite demand.  The petition is docketed as File Case No. 03-033.  Attached to it are the June 30, 2003 Statement of

Account[8] and July 22, 2000 demand letter[9] issued to respondent.   

 

            In a letter dated November 21, 2003, the Clerk of Court, as Ex-Oficio Sheriff, recommended to the RTC Executive

Judge that the petition be dismissed for the following reasons: 

                Under the facts given, no mortgage exists between the petitioner and respondent. Evidently, it is not one of those contemplated under Act 3135 as amended by Act 4118. The allegation simply does not show a mortgagor-mortgagee relationship since respondent liability arises from his failure to pay dues, assessments and charges due to the petitioner.                 As clearly stated, the authority of the Executive Judge under Administrative Matter No. 99-10-05-0, as amended dated March 1, 2001, covers extra-judicial foreclosure of real estate mortgages under R.A. No. 3135 and chattel mortgages under P.D. No. 1508. There is nothing in the above mentioned Circular which authorizes the Executive Judge and/or the Ex-Officio Sheriff to extra judicially foreclose properties covered by obligations other than the said mortgages. Hence,

the subject petition is not proper for extra-judicial foreclosure under the supervision of the Executive Judge. Dismissal of the subject petition is recommended.[10]

           

            Agreeing with the Clerk of Court, the RTC Executive Judge issued on January 7, 2004 the following Order:                 Upon perusal of the pertinent laws and Supreme Court Resolutions, this Court concurs with the position taken by the Ex-Oficio Sheriff that herein petition is not within the coverage of Administrative Matter No. 99-10-05-0 as amended, dated March 1, 2001 re: Procedure in Extra Judicial Foreclosure of Mortgage, paragraph 1 thereof is hereby quoted as follows: 

                “1. All applications for extra-judicial foreclosure of mortgage whether under the direction of the sheriff or a notary public, pursuant to Act 3135, as amended by Act 4118, and Act 1508, as amended, shall be filed with the Executive Judge, through the Clerk of Court who is also the Ex-Oficio Sheriff.”

                 Hence, it is not within the authority of the Executive Judge to supervise and approve extra judicial foreclosures of mortgages.                 WHEREFORE, the request for extra-judicial foreclosure of the subject condominium unit is DENIED. Consequently, the petition is DISMISSED.                               SO ORDERED.[11]     (Emphasis added.)

 

            Petitioner filed a Motion for Reconsideration,[12] but the RTC Executive Judge denied it in an Order[13] dated March

31, 2004.

 

            Hence, the present petition.

 

            Petitioner asserts that it is expressly provided under Section 20 of Republic Act (R.A.) No. 4726 that it has the right

to cause the extrajudicial foreclosure of its annotated lien on the condominium unit.  Its petition then is cognizable by the

RTC under Administrative Matter No. 99-10-05.[14]

           

            In his Comment,[15] Supplemental Comment[16] and Memorandum,[17] respondent objects to petitioner's direct appeal

to this Court from an Order issued by the RTC on a mere administrative matter. [18]  Respondent also impugns petitioner's

right to file the petition for extra-judicial foreclosure, pointing out that the latter does not hold a real estate mortgage on the

condominium unit or a special power of attorney to cause the extra-judicial foreclosure sale of said unit. [19]  Respondent

claims that there is even a pending litigation regarding the validity of petitioner's constitution as a homeowners association and

its authority to assess association dues, annotate unpaid assessments on condominium titles and enforce the same through

extrajudicial foreclosure sale.[20]  In sum, respondent contends that petitioner has no factual or legal basis to file the petition for

extrajudicial foreclosure.

 

            The petition lacks merit.

 

            Only a judgment, final order or resolution rendered by a court in the exercise of its judicial functions relative to an

actual controversy is subject to an appeal to this Court by way of a Petition for Review on Certiorari under Rule 45 of the

Rules of Court.[21] The January 7, 2004 Order and March 21, 2004 Order assailed herein were issued by the RTC Executive

Judge in the exercise of his administrative function to supervise the ministerial duty of the Clerk of Court as Ex-Oficio Sheriff

in the conduct of an extrajudicial foreclosure sale; hence, said orders are not appealable under Rule 45.  Rather, the correct

mode of appeal is by petition formandamus[22] under Section 3, Rule 65 of the Rules of Court, to wit:                 Sec. 3.  Petition for mandamus — When any tribunal, corporation, board, officer or person unlawfully neglects the performance of an act which the law specifically enjoins as a duty resulting from an office, trust, or station, or unlawfully excludes another from the use and enjoyment of a right or office to which such other is entitled, and there is no other plain, speedy and adequate remedy in the ordinary course of law, the person aggrieved thereby may file a verified petition in the proper court, alleging the facts with certainty and praying that judgment be rendered commanding the respondent, immediately or at some other time to be specified by the court, to do the act required to be done to protect the rights of the petitioner, and to pay the damages sustained by the petitioner by reason of the wrongful acts of the respondent.

 

            Although under Section 5,[23] Rule 56, an erroneous appeal may be dismissed outright, this Court shall not exercise

such option; but instead, shall treat the present petition as a petition for mandamus to obviate further litigation between the

parties.[24]    

 

            Yet, in order to avail itself of a writ of mandamus, petitioner must establish that it has a clear right to the extrajudicial

foreclosure sale of the condominium unit of respondent.[25]  Under Circular No. 7-2002,[26] implementing Supreme Court

Administrative Matter No. 99-10-05-0,[27] it is mandatory that a petition for extrajudicial foreclosure be supported by

evidence that petitioner holds a special power or authority to foreclose, thus:                 Sec. 1. All applications for extra-judicial foreclosure of mortgage, whether under the direction of the Sheriff or a notary public pursuant to Art. No. 3135, as amended, and Act 1508, as amended, shall be filed with the Executive Judge, through the Clerk of Court, who is also the Ex-Officio Sheriff (A.M. No. 99-10-05-0, as amended, March 1, 2001).                 Sec. 2.   Upon receipt of the application, the Clerk of Court shall: 

                a.  Examine the same to ensure that the special power of attorney authorizing the extra-judicial foreclosure of the real property is either inserted into or attached to the deed of real estate mortgage (Act No. 3135, Sec. 1, as amended) x x x.

           

Without proof of petitioner’s special authority to foreclose, the Clerk of Court as Ex-Oficio Sheriff is precluded

from acting on the application for extrajudicial foreclosure.[28]

 

            In the present case, the only basis of petitioner for causing the extrajudicial foreclosure of the condominium unit of

respondent is a notice of assessment annotated on CCT No. 1972 in accordance with Section 20 of R.A. No.

4726.  However, neither annotation nor law vests it with sufficient authority to foreclose on the property.

 

            The notice of assessment contains no provision for the extrajudicial foreclosure of the condominium unit.  All that it

states is that the assessment of petitioner against respondent for unpaid association dues constitutes a “first lien against [the]

condominium unit.”[29]

 

            Neither does Section 20 of R.A. No. 4726[30] grant petitioner special authority to foreclose.  All that the law provides

is the following: 

                Sec. 20.  The assessment upon any condominium made in accordance with a duly registered declaration of restrictions shall be an obligation of the owner thereof at the time the assessment is made. The amount of any such assessment plus any other charges thereon, such as interest, costs (including attorney's fees) and penalties, as such may be provided for in the declaration of restrictions, shall be and become a lien upon the condominium to be registered with the Register of Deeds of the city or province where such condominium project is located. The notice shall state the amount of such assessment and such other charges thereon as may be authorized by the declaration of restrictions, a description of condominium unit against which same has been assessed, and the name of the registered owner thereof. Such notice shall be signed by an authorized representative of the management body or as otherwise provided in the declaration of restrictions. Upon payment of said assessment and charges or other satisfaction thereof, the management body shall cause to be registered a release of the lien.                 Such lien shall be superior to all other liens registered subsequent to the registration of said notice of assessment except real property tax liens and except that the declaration of restrictions may provide for the subordination thereof to any other liens and encumbrances, such liens may be enforced in the same manner provided for by law for the judicial or extra-judicial foreclosure of mortgage or real property. Unless otherwise provided for in the declaration of the restrictions, the management body shall have power to bid at foreclosure sale. The condominium owner shall have the right of redemption as in cases of judicial or extra-judicial foreclosure of mortgages.   (Emphasis supplied.)

 

            Clearly, Section 20 merely prescribes the procedure by which petitioner’s claim may be treated as a superior lien

– i.e., through the annotation thereof on the title of the condominium unit. [31]  While the law also grants petitioner the option

to enforce said lien through either the judicial or extrajudicial foreclosure sale of the condominium unit, Section 20 does not

by itself, ipso facto, authorize judicial as extra-judicial foreclosure of the condominium unit.  Petitioner may avail itself of

either option only in the manner provided for by the governing law and rules.  As already pointed out, A.M. No. No. 99-10-

05-0, as implemented under Circular No. 7-2002, requires that petitioner furnish evidence of its special authority to cause the

extrajudicial foreclosure of the condominium unit.

 

            There being no evidence of such special authority, petitioner failed to establish a clear right to a writ of  mandamus to

compel theRTC to act on its petition for extrajudicial foreclosure.

 

            WHEREFORE, the petition is DENIED for lack of merit.

 

            Costs against petitioner.

 

            SO ORDERED.LEONOR B. CRUZ,                                  Petitioner,   

- versus -    

TEOFILA M. CATAPANG,                                  Respondent.

 G.R. No. 164110      Present:      QUISUMBING, J., Chairperson,     CARPIO,     CARPIO MORALES,     TINGA, and     VELASCO, JR., JJ. 

Promulgated: 

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DECISION

QUISUMBING, J.:

This petition for review seeks the reversal of the Decision[1] dated September 16, 2003 and the

Resolution[2] dated June 11, 2004 of the Court of Appeals in CA-G.R. SP No. 69250.  The Court of Appeals

reversed the Decision[3] dated October 22, 2001 of the Regional Trial Court (RTC), Branch 86, Taal,

Batangas, which had earlier affirmed the Decision[4] dated September 20, 1999 of the 7th Municipal Circuit

Trial Court (MCTC) of Taal, Batangas ordering respondent to vacate and deliver possession of a portion of

the lot co-owned by petitioner, Luz Cruz and Norma Maligaya.

The antecedent facts of the case are as follows.

Petitioner Leonor B. Cruz, Luz Cruz and Norma Maligaya are the co-owners of a parcel of

land covering an area of 1,435 square meters located at Barangay Mahabang Ludlod, Taal, Batangas.

[5]  With the consent of Norma Maligaya, one of the aforementioned co-owners, respondent Teofila M.

Catapang built a house on a lot adjacent to the abovementioned parcel of land sometime in 1992.   The

house intruded, however, on a portion of the co-owned property.[6]

In the first week of September 1995, petitioner Leonor B. Cruz visited the property and was

surprised to see a part of respondent’s house intruding unto a portion of the co-owned property.  She then

made several demands upon respondent to demolish the intruding structure and to vacate the portion

encroaching on their property.  The respondent, however, refused and disregarded her demands.[7] 

On January 25, 1996, the petitioner filed a complaint[8] for forcible entry against respondent

before the 7th MCTC of Taal, Batangas.  The MCTC decided in favor of petitioner, ruling that consent of

only one of the co-owners is not sufficient to justify defendant’s construction of the house and possession

of the portion of the lot in question.[9]  The dispositive portion of the MCTC decision reads:

WHEREFORE, judgment is hereby rendered ordering the defendant or any person acting in her behalf to vacate and deliver the possession of the area illegally occupied to the plaintiff; ordering the defendant to pay plaintiff reasonable attorney’s fees of P10,000.00, plus costs of suit.

SO ORDERED.[10]

On appeal, the RTC, Branch 86, Taal, Batangas, affirmed the MCTC’s ruling in a Decision

dated October 22, 2001, the dispositive portion of which states:

Wherefore, premises considered, the decision [appealed] from is hereby affirmed in toto.

SO ORDERED.[11]

After her motion for reconsideration was denied by the RTC, respondent filed a petition for review

with the Court of Appeals, which reversed the RTC’s decision.  The Court of Appeals held that there is no cause

of action for forcible entry in this case because respondent’s entry into the property, considering the consent

given by co-owner Norma Maligaya, cannot be characterized as one made through strategy or stealth which

gives rise to a cause of action for forcible entry.[12]  The Court of Appeals’ decision further held that petitioner’s

remedy is not an action for ejectment but an entirely different recourse with the appropriate forum.  The Court of

Appeals disposed, thus:

WHEREFORE, premises considered, the instant Petition is hereby GRANTED.   The challenged Decision dated 22 October 2001 as well as the Order dated 07 January 2002 of the Regional Trial Court of Taal, Batangas, Branch 86, are hereby REVERSED andSET ASIDE and, in lieu thereof, another is entered DISMISSING the complaint for forcible entry docketed as Civil Case No. 71-T.

SO ORDERED.[13]

After petitioner’s motion for reconsideration was denied by the Court of Appeals in a

Resolution dated June 11, 2004, she filed the instant petition.

Raised before us for consideration are the following issues:

I.

WHETHER OR NOT THE KNOWLEDGE AND CONSENT OF CO-OWNER NORMA MALIGAYA IS A VALID LICENSE FOR THE RESPONDENT TO ERECT THE BUNGALOW HOUSE ON THE PREMISES OWNED PRO-INDIVISO SANS CONSENT FROM THE PETITIONER AND OTHE[R] CO-OWNER[.]

II.

WHETHER OR NOT RESPONDENT, BY HER ACTS, HAS ACQUIRED EXCLUSIVE OWNERSHIP OVER THE PORTION OF THE LOT SUBJECT OF THE PREMISES PURSUANT TO THE CONSENT GRANTED UNTO HER BY CO-OWNER NORMA MALIGAYA TO THE EXCLUSION OF THE PETITIONER AND THE OTHER CO-OWNER.[14]

III.

. . . WHETHER OR NOT RESPONDENT IN FACT OBTAINED POSSESSION OF THE PROPERTY IN QUESTION BY MEANS OF SIMPLE STRATEGY.[15]

Petitioner prays in her petition that we effectively reverse the Court of Appeals’ decision.

Simply put, the main issue before us is whether consent given by a co-owner of a parcel of land

to a person to construct a house on the co-owned property warrants the dismissal of a forcible entry case

filed by another co-owner against that person.

In her memorandum,[16] petitioner   contends that   the   consent   and knowledge of co-owner

Norma Maligaya cannot defeat the action for forcible entry since it is a basic principle in the law of co-

ownership that no individual co-owner can claim title to any definite portion of the land or thing owned in

common until partition.

On the other hand, respondent in her memorandum[17] counters that the complaint for forcible

entry cannot prosper because her entry into the property was not through strategy or stealth due to the consent

of one of the co-owners.  She further argues that since Norma Maligaya is residing in the house she built, the

issue is not just possession de facto but also one ofpossession de jure since it involves rights of co-owners to

enjoy the property.

As to the issue of whether or not the consent of one co-owner will warrant the dismissal of a

forcible entry case filed by another co-owner against the person who was given the consent to construct a

house on the co-owned property, we have held that a co-owner cannot devote common property to his or

her exclusive use to the prejudice of the co-ownership.[18]  In our view, a co-owner cannot give valid

consent to another to build a house on the co-owned property, which is an act tantamount to devoting the

property to his or her exclusive use.

Furthermore, Articles 486 and 491 of the Civil Code provide:

Art. 486.    Each co-owner may use the thing owned in common, provided he does so in accordance with the purpose for which it is intended and in such a way as not to injure the interest of the co-ownership or prevent the other co-owners from using it according to their rights.  The purpose of the co-ownership may be changed by agreement, express or implied.

Art. 491.    None of the co-owners shall, without the consent of the others, make alterations in the thing owned in common, even though benefits for all would result therefrom.  However, if the withholding of the consent by one or more of the co-owners is clearly prejudicial to the common interest, the courts may afford adequate relief.

Article 486 states each co-owner may use the thing owned in common provided he does so in

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

co-ownership or prevent the other co-owners from using it according to their rights.  Giving consent to a

third person to construct a house on the co-owned property will injure the interest of the co-ownership and

prevent other co-owners from using the property in accordance with their rights.

Under Article 491, none of the co-owners shall, without the consent of the others, make alterations in

the thing owned in common.  It necessarily follows that none of the co-owners can, without the consent of the

other co-owners, validly consent to the making of an alteration by another person, such as respondent, in the

thing owned in common. Alterations include any act of strict dominion or ownership and any encumbrance or

disposition has been held implicitly to be an act of alteration.[19]  The construction of a house on the co-owned

property is an act of dominion.  Therefore, it is an alteration falling under Article 491 of the Civil Code.  There

being no consent from all co-owners, respondent had no right to construct her house on the co-owned property.  

Consent of only one co-owner will not warrant the dismissal of the complaint for forcible entry filed

against the builder. The consent given by Norma Maligaya in the absence of the consent of petitioner and Luz

Cruz did not vest upon respondent any right to enter into the co-owned property.  Her entry into the property still

falls under the classification “through strategy or stealth.” 

The Court of Appeals held that there is no forcible entry because respondent’s entry into the

property was not through strategy or stealth due to the consent given to her by one of the co-owners.   We

cannot give our imprimatur to this sweeping conclusion.  Respondent’s entry into the property without the

permission of petitioner could appear to be a secret and clandestine act done in connivance with co-owner

Norma Maligaya whom respondent allowed to stay in her house.  Entry into the land effected

clandestinely without the knowledge of the other co-owners could be categorized as possession by stealth.

[20]  Moreover, respondent’s act of getting only the consent of one co-owner, her sister Norma Maligaya,

and allowing the latter to stay in the constructed house, can in fact be considered as a strategy which she

utilized in order to enter into the co-owned property.  As such, respondent’s acts constitute forcible entry.

          Petitioner’s filing of a complaint for forcible entry, in our view, was within the one-year period for filing

the complaint.  The one-year period within which to bring an action for forcible entry is generally counted from

the date of actual entry to the land. However, when entry is made through stealth, then the one-year period is

counted from the time the petitioner learned about it.[21] Although respondent constructed her house in 1992, it

was only in September 1995 that petitioner learned of it when she visited the property.  Accordingly, she then

made demands on respondent to vacate the premises.  Failing to get a favorable response, petitioner filed the

complaint on January 25, 1996, which is within the one-year period from the time petitioner learned of the

construction.

WHEREFORE, the petition is GRANTED.  The Decision dated September 16, 2003 and the

Resolution dated June 11, 2004 of the Court of Appeals in CA-G.R. SP No. 69250

are REVERSED and SET ASIDE.  The Decision datedOctober 22, 2001 of the Regional Trial Court,

Branch 86, Taal, Batangas is REINSTATED.  Costs against respondent.

SO ORDERED.

Spouses ALEXANDER CRUZ and ADELAIDA CRUZ, petitioners, vs. ELEUTERIO LEIS, RAYMUNDO LEIS, ANASTACIO L. LAGDANO, LORETA L. CAYONDA and the HONORABLE COURT OF APPEALS, respondents.LexjÓ uris

D E C I S I O N

KAPUNAN, J.:

Private respondents, the heirs of spouses Adriano Leis and Gertrudes Isidro,[1] filed an action before the Regional Trial Court (RTC) of Pasig seeking the nullification of the contracts of sale over a lot executed by Gertrudes Isidro in favor of petitioner Alexander Cruz, as well as the title subsequently issued in the name of the latter. Private respondents claimed that the contracts were vitiated by fraud as Gertrudes was illiterate and already 80 years old at the time of the execution of the contracts; that the price for the land was insufficient as it was sold only for P39,083.00 when the fair market value of the lot should be P1,000.00 per square meter, instead of P390.00, more or less; and that the property subject of the sale was conjugal and, consequently, its sale without the knowledge and consent of private respondents was in derogation of their rights as heirs.

The facts that gave rise to the complaint: JuriÓ smis

Adriano and Gertrudes were married on 19 April 1923. On 27 April 1955, Gertrudes acquired from the then Department of Agriculture and Natural Resources (DANR) a parcel of land with an area of one hundred (100) square meters, situated at Bo. Sto. Niño, Marikina, Rizal and covered by Transfer Certificate of Title (TCT) No. 42245. The Deed of Sale described Gertrudes as a widow. On 2 March 1956, TCT No. 43100 was issued in the name of "Gertrudes Isidro," who was also referred to therein as a "widow."

On 2 December 1973, Adriano died. It does not appear that he executed a will before his death.

On 5 February 1985, Gertrudes obtained a loan from petitioners, the spouses Alexander and Adelaida Cruz, in the amount ofP15,000.00 at 5% interest, payable on or before 5 February 1986. The loan was secured by a mortgage over the property covered by TCT No. 43100. Gertrudes, however, failed to pay the loan on the due date.

Unable to pay her outstanding obligation after the debt became due and payable, on 11 March 1986, Gertrudes executed two contracts in favor of petitioner Alexander Cruz. The first is denominated as "Kasunduan," which the parties concede is a pacto de retro sale, granting Gertrudes one year within which to repurchase the property. The second is a "Kasunduan ng Tuwirang Bilihan," a Deed of Absolute Sale covering the same property for the price of P39,083.00, the same amount stipulated in the "Kasunduan." Jjjä uris

For failure of Gertrudes to repurchase the property, ownership thereof was consolidated in the name of Alexander Cruz in whose name TCT No. 130584 was issued on 21 April 1987, canceling TCT No. 43100 in the name of Gertrudes Isidro.

On 9 June 1987, Gertrudes Isidro died. Thereafter, her heirs, herein private respondents, received demands to vacate the premises from petitioners, the new owners of the property. Private respondents responded by filing a complaint as mentioned at the outset.

On the basis of the foregoing facts, the RTC rendered a decision in favor of private respondents. The RTC held that the land was conjugal property since the evidence presented by private respondents disclosed that the same was acquired during the marriage of the spouses and that Adriano contributed money for the purchase of the property. Thus, the court concluded, Gertrudes could only sell to petitioner spouses her one-half share in the property.

The trial court also ruled that no fraud attended the execution of the contracts. Nevertheless, the "Kasunduan," providing for a sale conpacto de retro, had superseded the "Kasunduan ng Tuwirang Bilihan," the deed of absolute sale. The trial court did not consider thepacto de retro sale an equitable mortgage, despite the allegedly insufficient price. Nonetheless, the trial court found for private respondents. It rationalized that petitioners failed to comply with the provisions of Article 1607 of the Civil Code requiring a judicial order for the consolidation of the ownership in the vendee a retro to be recorded in the Registry of Property.

The dispositive portion of the RTC's Decision reads: lex

WHEREFORE, in the light of all the foregoing, judgment is hereby rendered:

1. Declaring Exhibit G – "Kasunduan ng Tuwirang Bilihan" Null and Void and declar[ing] that the title issued pursuant thereto is likewise Null and Void;

2. Declaring the property in litigation as conjugal property;

3. Ordering the Registry of Deeds of Marikina Branch to reinstate the title of Gertrudes Isidro;

4. Ordering the plaintiff[s] [sic] to comply with the provision[s] of Article 1607 in relation to Article 1616 of the Civil Code;

5. Ordering the defendant[s] to pay plaintiff[s] P15,000.00 nominal damages for the violation of plaintiffs’ rights;

6. Ordering the defendant[s] to pay plaintiff[s] the sum of P8,000.00 as and for attorney’s fees;

7. Dismissing defendant[s'] counterclaim; and

8. Ordering defendant[s] to pay the cost of suit. Jksm

SO ORDERED.[2]

Petitioners appealed to the Court of Appeals in vain. The Court of Appeals affirmed the decision of the Regional Trial Court, holding that since the property was acquired during the marriage of Gertrudes to Adriano, the same was presumed to be conjugal property under Article 160 of the Civil Code. The appellate court, like the trial court, also noted that petitioner did not comply with the provisions of Article 1607 of the Civil Code.

Petitioners are now before this Court seeking the reversal of the decision of the Court of Appeals. First, they contend that the subject property is not conjugal but is owned exclusively by Gertrudes, who was described in the Deed of Sale between Gertrudes and the DANR as well as in TCT No. 43100 as a widow. Second, assuming the land was conjugal property, petitioners argue that the same became Gertrudes’ exclusively when, in 1979, she mortgaged the property to the Daily Savings Bank and Loan Association. The bank later foreclosed on the mortgage in 1981 but Gertrudes redeemed the same in 1983. Chief

The paraphernal or conjugal nature of the property is not determinative of the ownership of the disputed property. If the property was paraphernal as contended by petitioners, Gertrudes Isidro would have the absolute right to dispose of the same, and absolute title and ownership was vested in petitioners upon the

failure of Gertrudes to redeem the property. On the other hand, if the property was conjugal, as private respondents maintain, upon the death of Adriano Leis, the conjugal partnership was terminated,[3] entitling Gertrudes to one-half of the property.[4] Adriano’s rights to the other half, in turn, were transmitted upon his death to his heirs,[5] which includes his widow Gertrudes, who is entitled to the same share as that of each of the legitimate children.[6] Thus, as a result of the death of Adriano, a regime of co-ownership arose between Gertrudes and the other heirs in relation to the property.

Incidentally, there is no merit in petitioners’ contention that Gertrudes’ redemption of the property from the Daily Savings Bank vested in her ownership over the same to the exclusion of her co-owners. We dismissed the same argument by one of the petitioners in Paulmitan vs. Court of Appeals,[7] where one of the petitioners therein claimed ownership of the entire property subject of the case by virtue of her redemption thereof after the same was forfeited in favor of the provincial government for non-payment of taxes. We held, however, that the redemption of the land "did not terminate the co-ownership nor give her title to the entire land subject of the co-ownership." We expounded, quoting our pronouncement in Adille vs. Court of Appeals:[8]

The petition raises a purely legal issue: May a co-owner acquire exclusive ownership over the property held in common?Esmsc

Essentially, it is the petitioner’s contention that the property subject of dispute devolved upon him upon the failure of his co-heirs to join him in its redemption within the period required by law. He relies on the provisions of Article 1515 of the old Civil Code, Article 1613 of the present Code, giving the vendee a retro the right to demand redemption of the entire property.

There is no merit in this petition.

The right of repurchase may be exercised by a co-owner with respect to his share alone (CIVL CODE, art. 1612; CIVIL CODE (1889), art. 1514.). While the records show that petitioner redeemed the property in its entirety, shouldering the expenses therefor, that did not make him the owner of all of it. In other words, it did not put to end the existing state of co-ownership (Supra, Art. 489). There is no doubt that redemption of property entails a necessary expense. Under the Civil Code: Esmmis

Art. 488. Each co-owner shall have a right to compel the other co-owners to contribute to the expenses of preservation of the thing or right owned in common and to the taxes. Any one of the latter may exempt himself from this obligation by renouncing so much of his undivided interest as may be equivalent to his share of the expenses and taxes. No such waiver shall be made if it is prejudicial to the co-ownership.

The result is that the property remains to be in a condition of co-ownership. While a vendee a retro, under Article 1613 of the Code, "may not be compelled to consent to a partial redemption," the redemption by one co-heir or co-owner of the property in its totality does not vest in him ownership over it. Failure on the part of all the co-owners to redeem it entitles the vendee a retro to retain the property and consolidate title thereto in his name (Supra, art. 1607). But the provision does not give to the redeeming co-owner the right to the entire property. It does not provide for a mode of terminating a co-ownership.

It is conceded that, as a rule, a co-owner such as Gertrudes could only dispose of her share in the property owned in common. Article 493 of the Civil Code provides:

ART. 493. Each co-owner shall have the full ownership of his part of the fruits and benefits pertaining thereto, and he may therefore alienate, assign or mortgage it, and even substitute another person in its enjoyment, except when personal rights are involved. But the effect of the alienation or the mortgage, with respect to the co-owners, shall be limited to the portion which may be allotted to him in the division upon the termination of the co-ownership. Es-mso

Unfortunately for private respondents, however, the property was registered in TCT No. 43100 solely in the name of "Gertrudes Isidro, widow." Where a parcel of land, forming part of the undistributed properties of the dissolved conjugal partnership of gains, is sold by a widow to a purchaser who merely relied on the face of the certificate of title thereto, issued solely in the name of the widow, the purchaser acquires a valid title to the land even as against the heirs of the deceased spouse. The rationale for this rule is that "a person dealing with registered land is not required to go behind the register to determine the condition of the property. He is only charged with notice of the burdens on the property which are noted on the face of the register or the certificate of title. To require him to do more is to defeat one of the primary objects of the Torrens system."[9]

As gleaned from the foregoing discussion, despite the Court of Appeals’ finding and conclusion that Gertrudes as well as private respondents failed to repurchase the property within the period stipulated and has lost all their rights to it, it still ruled against petitioners by affirming the Regional Trial Court's decision on the premise that there was no compliance with Article 1607 of the Civil Code requiring a judicial hearing before registration of the property in the name of petitioners. This provision states: Ms-esm

ART. 1607. In case of real property, the consolidation of ownership in the vendee by virtue of the failure of the vendor to comply with the provisions of article 1616 shall not be recorded in the Registry of Property without a judicial order, after the vendor has been duly heard.

The aforequoted article is intended to minimize the evils which the pacto de retro sale has caused in the hands of usurers. A judicial order is necessary in order to determine the true nature of the transaction and to prevent the interposition of buyers in good faith while the determination is being made.[10]E-xsm

It bears stressing that notwithstanding Article 1607, the recording in the Registry of Property of the consolidation of ownership of the vendee is not a condition sine qua non to the transfer of ownership. Petitioners are the owners of the subject property since neither Gertrudes nor her co-owners redeemed the same within the one-year period stipulated in the "Kasunduan." The essence of a pacto de retro sale is that title and ownership of the property sold are immediately vested in the vendee a retro, subject to the resolutory condition of repurchase by the vendor a retro within the stipulated period. Failure thus of the vendor a retro to perform said resolutory condition vests upon the vendee by operation of law absolute title and ownership over the property sold. As title is already vested in the vendee a retro, his failure to consolidate his title under Article 1607 of the Civil Code does not impair such title or ownership for the method prescribed thereunder is merely for the purpose of registering the consolidated title.[11]

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

SO ORDERED.

FELIPE SEGURA, ANTONIA SEGURA, NICANORA SEGURA, BERNANDINA SEGURA, ALIPIO SEGURA and MONSERRAT SEGURA, plaintiffs-appellants, vs.NICOLAS SEGURA, SANTIAGO SEGURA, GAUDENCIO SEGURA, EMILIANO AMOJIDO, MILDRED ELISON VDA. DE JAVELOSA, ERNESTO AMOJIDO, EPIFANIA DE AMOJIDO, IGMEDIO AMOJIDO, and THE RURAL BANK OF SANTA BARBARA, defendants-appellees.

Robert B. Maroma for plaintiffs-appellants.

Estefano Caspe for defendants-appellees.

 

CRUZ, J.:

This is another distasteful case where kin is pitted against kin in a bitter dispute over property inherited from a common ancestor who probably would have been distressed to see her progeny quarreling over it as if they were hostile strangers.

The land in question consists of 4,060 square meters and was originally registered under Original Certificate of Title No. 1994 in the Registry of Deeds of Iloilo in the name of Gertrudes Zamora. 1 She died intestate and without debts in 1936 and was survived by four children, who never got around to dividing the property among themselves. This controversy is not among the four brothers, who are now also deceased. It is Gertrudes's grandchildren by three of her sons (the fourth having died without issue) who are involved in this complaint for recovery of ownership and possession of the disputed inheritance, plus damages.

The conflict began when on April 6, 1941, three of these nine grandchildren, namely, Nicolas, Santiago and Gaudencio Segura, executed a deed of extrajudicial partition arrogating the entire property to themselves alone as equal pro indiviso owners 2 (thereby, curiously, excluding Nicolas and Santiago's own brother and two sisters, and Gaudencio's own sister, besides the other two co-heirs.) This partition was not registered immediately, but only in 1946, or five years later.

Before and after such registration, the following developments transpired:

1. The land was sold for P50.00 to Emiliano Amojido, with right to repurchase on or before February 15, 1942. This right was not exercised. 3

2. On November 28, 1946, Amojido executed an affidavit of consolidation of ownership and obtained TCT No. 28336, with a reservation of the rights of the other heirs annotated therein. 4

3. On March 31, 1953, Amojido sold the land for P1,500.00 to Mirope Mascareñias vda. de Elison, who obtained TCT No. T-19396 in her name, which did not retain the annotation. 5

4. On May 28, 1956, the plaintiffs filed Civil Case No. 3941, for recovery of possession and ownership of the subject land from Nicolas, Santiago and Gaudencio Segura. 6

5. On February 14, 1957, Elison sold the land for P1,000.00 to Mildred Elison vda. de Javelosa, who obtained TCT No. 22074 in her name. 7

6. On January l5, 1958, Mildred sold the land for P1,500.00 to Ernesto and Igmedio Amojido, who obtained TCT No 24342 in their names. 8

7. On January 16,1958, Civil Case No. 3941 was dismissed on motion of the plaintiffs' counsel.

8. On July 23, 1961, the land was mortgaged to the Rural Bank of Sta. Barbara, which is one of the appellees herein.

The complaint in the case at bar was filed on January 11, 1968, and docketed as Civil Case No. 7477 in the Court of First Instance of Iloilo. In it, the six excluded grandchildren alleged that the partition and all subse quent transfers of the subject land were null and void insofar as these transactions deprived them of their shares as co-owners of the said property. The defendants moved to dismiss, contending that the action was barred by prior judgment and that in any event whatever rights might have pertained to the plaintiffs had already prescribed under the Rules of Court and the Civil Code. The plaintiffs opposed the motion. Thereafter, issues having been joined, the trial courts 9 issued its order of March 28, 1968, dismissing the complaint on the ground of prescription. The motion for reconsideration was denied in an order dated May 28, 1968, on the further ground, as if it were an afterthought, of res judicata. The plaintiffs then appealed to this Court and now ask that the said orders be reversed and the complaint reinstated.

We hold at the outset that the present action is not barred by prior judgment as the dismissal of the earlier complaint was without prejudice to its refiling at a future date. It appears that when Civil Case No. 3941 was called for hearing, the plaintiffs' counsel himself moved for its dismissal on the ground that his clients had gone to Mindanao and he did not know when they would be returning. 10 There is here no showing of failure to prosecute, such as an unreasonable delay on the part of the complainants, and the appellees have not so contended. It was clear that the plaintiffs' counsel had the intention of reviving the case, and that must have been the impression too of the trial judge because his order of dismissal did not state that it was with prejudice to the refiling of the case. 11 The applicable rule is Rule 17, Section 2, of the Rules of Court reading thus:

Dismissal by order of the court.-Except as provided in the preceding section, an action shall not be dismissed at the plaintiffs instance save upon order of the court and upon such terms and conditions as the court deems proper. If a counterclaim has been pleaded by a defendant prior to the service upon him of the plaintiffs motion to dismiss, the action shall not be dismissed against the defendant's objection unless the counterclaim can remain pending for independent adjudication by the court. Unless otherwise specified in the order, a dismissal under this paragraph shall be without prejudice.

It follows that even, if, as noted by the trial court in its Order of May 28, 1968, "the same case Civil Case No. 3941 of this Court. Exh. 'A' with the same subject matter, with the same plaintiffs, almost with the same defendants, and the same theory, was dismissed by this Court on January 16,1958," the present action is not barred by res judicata.

The second ground is not as simple.

The claim of prescription is based first on the contention that under the Rules of Court the deed of extrajudicial partition should have been impugned within two years from the date of its execution in 1941. As the challenge in the instant case was made only in 1956, when Civil Case No. 3941 was filed, that first case, and more so the case at bar which was commenced in 1968, should be and were properly dismissed for tardiness under Rule 74, Section 4, of the Rules of Court.

This section provides in gist that a person who has been deprived of his lawful participation in the estate of the decedent, whether as heir or as creditor, must assert his claim within two years after the

extrajudicial or summary settlement of such estate under Sections 1 and 2 respectively of the same Rule 74. Thereafter, he will be precluded from doing so as the right will have prescribed.

It is clear that Section 1 of Rule 74 does not apply to the partition in question which was null and void as far as the plaintiffs were concerned. The rule covers only valid partitions. The partition in the present case was invalid because it excluded six of the nine heirs who were entitled to equal shares in the partitioned property. Under the rule, "no extrajudicial settlement shall be binding upon any person who has not participated therein or had no notice thereof." As the partition was a total nullity and did not affect the excluded heirs, it was not correct for the trial court to hold that their right to challenge the partition had prescribed after two years from its execution in 1941.

The appellees invoke a second basis for their claim of prescription and argue that even under the Civil Code the complaint should also be deemed prescribed pursuant to the following provisions:

Art. 1134. Ownership and other real rights over immovable property are acquired by ordinary prescription through possession of ten years (1957a).

Art. 1144. The following actions must be brought within ten years from the time the right of action accrues:

(1) Upon a written contract;

(2) Upon an obligation created by law;

(3) Upon a judgment.

It is recalled that following the execution of the deed of partition, the owners named therein sold the entire land to Emiliano Amojido who, after the vendors had failed to exercise their right of repurchase, executed an affidavit of consolidation in his favor on November 28, 1946. He subsequently obtained a transfer certificate of title in his name, but this contained the following annotation:

This land is subject to any claim that may be presented by any heir or any other person deprived of his lawful participation in the estate of Gertrudes Zamora, within two years from date of the Extra-judicial Settlement and distribution of the estate. 12

As a person can sell only what he owns or is authorized to sell, the buyer can as a consequence acquire no more than what the seller can legally transfer. The deed of partition being invalid as to the other heirs, the vendors could dispose only of their respective shares in the land, or one-third only of the property and not the other two-thirds as well which did not belong to them.

Article 493 of the Civil Code reads as follows:

Each co-owner shall have the full ownership of his part and the fruits and benefits pertaining thereto, and he may therefore alienate, assign or mortgage it, and even substitute another person in its enjoyment, except when personal rights are involved. But the effect of the alienation or the mortgage, with respect to the co-owners, shall be limited to the portion which may be allotted to him in the division upon the termination of the co-ownership.

Applying this provision, we have held in previous cases:

When a real property belongs pro indiviso to three persons, who acquired it by inheritance from a common ancestor, the action for recovery by the legal representative of one of the heirs can only concern one-third of the property; and if the other co-owners have, by sale to third person, disposed of one-third of the said pro indiviso property, the plaintiff who sues for recovery is not entitled to ask for the annulment of the sale, inasmuch as the latter merely exercised their rights; such alienation does not affect the rights of the heir who claims only one-third, which belongs to the other two co-owners whose rights must be respected by the plaintiff. 13

Every co-heir has the absolute ownership of his share in the community property and may alienate, assign or mortgage the same, except as to purely personal rights, but the effect of any such transfer is limited to the portion which may be awarded to him upon the partition of the property. 14

None of the other co-heirs who did not participate in the sale can demand the nullification of the same, inasmuch as every co-owner may alienate, transfer, or mortgage his share in the common thing, and even substitute another person in the enjoyment thereof, unless personal rights are in question; although the effect of the alienation or mortgage, in relation to the co-owners shall be limited to the portion that may be adjudicated to him when the community ceased. 15

To repeat, the general rule is that no one can give what he does not have — nemo dat quod non habet. Hence, even if it be assumed that Amojido had bought the land in good faith from the parties to the extrajudicial partition, only so much of their share could be validly acquired by him, with the rest of the property remaining under the ownership of the six excluded co-heirs In other words, Amojido became pro indiviso co-owner of the land with the other six heirs, who retained title to their respective shares although he had possession of the entire property. The portion pertaining to the herein appellants should be deemed held by Amojido under an implied trust for their benefit, conformably to the ruling in Bargayo v. Camumot, 16 thus:

In law it is understood that the co-owners or co-heir who is in possession of an inheritance pro indivisofor himself and in representation of his co-owners or co-heirs, if, as such owner, he administers or takes care of the rest thereof with the obligation of delivering it to his co-owners or co-heirs, is under the same situation as a depository, a lessee, or a trustee.

There is no question that an action for reconveyance of property held in implied trust is imprescriptible. 17 However, this is true only as long as the trustee continues to acknowledge the title of the cestui que trust, or, otherwise stated, provided he does not repudiate such title." 18 The moment he does so, the prescriptive period will begin to run and may eventually operate to divest the real owners of their right to the property after the lapse of the applicable statutory period. Under the provision above-quoted, that period is fixed at ten years, whether the claim be based upon an obligation created by law under Article 1144 or covered by Article 1134 on rights over immovable property.

When did such prescriptive period start in the case at bar?

It is noted that when Amojido secured the registration of the land in his name following the deed of sale executed in his favor by the parties to the extrajudicial partition, his certificate of title carried an express reservation of whatever rights might pertain to the other heirs. This annotation constituted an acknowledgement of the possibility that a portion of the land might not belong to him and the commitment that he would be holding such part as impliedly conveyed to him in trust by and for its true owners. However, when Amojido himself sold the land to Mirope Mascareñas vda. de Elison on March 13, 1953, the transfer certificate of title issued in her name no longer carried the said encumbrance. By the deletion of this annotation, Mirope, as the new transferee, repudiated as of the date of registration the

claim of the other heirs to their shares in the property. From then on her assertion of ownership over the whole land became adverse even as against the appellants herein. And as the certificate of title was notice to the whole world of her exclusive title to the land, such rejection was binding on the said heirs and started as against them the period of prescription.

The record does not show when TCT No. T-19396 in the name of Mirope Mascareñas vda. de Elison was issued, but it can be conjectured that this was done before February 14, 1957, when she sold the land to Mildred Elison vda. de Javelosa. On the assumption that the land was registered in the name of Mirope in 1953 following her purchase without acknowledgement of the co-heirs' rights, the 10-year prescriptive period would have started from that year. Suspended on May 28, 1956, when the first complaint was filed, it began running again on February 16, 1958, 30 days after it was dismissed, and was completed after seven more years in 1965, two years before the second complaint was filed in 1968. Hence, that complaint was barred by prescription, as correctly held by the trial court, although the different starting point it used, erroneously, was 1941, date of the extrajudicial partition.

The unavoidable consequence of all this is that whatever claims the co-heirs could have validly asserted before can no longer be invoked by them at this time. They have let the time inexorably pass while they were slumbering on their rights, and now it is too late.

WHEREFORE, the appeal is DISMISSED, with costs against the appellants. It is so ordered.

DONATO S. PAULMITAN, JULIANA P. FANESA and RODOLFO FANESA, petitioners, vs.COURT OF APPEALS, ALICIO PAULMITAN, ELENA PAULMITAN, ABELINO PAULMITAN, ANITA PAULMITAN, BAKING PAULMITAN, ADELINA PAULMITAN and ANITO PAULMITAN, respondents.

 

ROMERO, J.:

This is a petition for review on certiorari seeking the reversal of the decision 1 of the Court of Appeals, dated July 14, 1982 in CA-G.R. No. 62255-R entitled "Alicio Paulmitan, et al. v. Donato Sagario Paulmitan, et al." which affirmed the decision 2 of the then Court of First Instance (now RTC) of Negros Occidental, 12th Judicial District, Branch IV, Bacolod City, in Civil Case No. 11770.

The antecedent facts are as follows:

Agatona Sagario Paulmitan, who died sometime in 1953, 3 left the two following parcels of land located in the Province of Negros Occidental: (1) Lot No. 757 with an area of 1,946 square meters covered by Original Certificate of Title (OCT) No. RO-8376; and (2) Lot No. 1091 with an area of 69,080 square meters and covered by OCT No. RO-11653. From her marriage with Ciriaco Paulmitan, who is also now deceased, Agatona begot two legitimate children, namely: Pascual Paulmitan, who also died in 1953, 4 apparently shortly after his mother passed away, and Donato Paulmitan, who is one of the petitioners. Petitioner Juliana P. Fanesa is Donato's daughter while the third petitioner, Rodolfo Fanes, is Juliana's husband. Pascual Paulmitan, the other son of Agatona Sagario, is survived by the respondents, who are his children, name: Alicio, Elena, Abelino, Adelina, Anita, Baking and Anito, all surnamed Paulmitan.

Until 1963, the estate of Agatona Sagario Paulmitan remained unsettled and the titles to the two lots mentioned above remained in the name of Agatona. However, on August 11, 1963, petitioner Donato Paulmitan executed an Affidavit of Declaration of Heirship, extrajudicially adjudicating unto himself Lot No. 757 based on the claim that he is the only surviving heir of Agatona Sagario. The affidavit was filed

with the Register of Deeds of Negros Occidental on August 20, 1963, cancelled OCT No. RO-8376 in the name of Agatona Sagario and issued Transfer Certificate of Title (TCT) No. 35979 in Donato's name.

As regards Lot No. 1091, Donato executed on May 28, 1974 a Deed of Sale over the same in favor of petitioner Juliana P. Fanesa, his daughter. 5

In the meantime, sometime in 1952, for non-payment of taxes, Lot No. 1091 was forfeited and sold at a public auction, with the Provincial Government of Negros Occidental being the buyer. A Certificate of Sale over the land was executed by the Provincial Treasurer in favor of the Provincial Board of Negros Occidental. 6

On May 29, 1974, Juliana P. Fanesa redeemed the property from the Provincial Government of Negros Occidental for the amount of P2,959.09. 7

On learning of these transactions, respondents children of the late Pascual Paulmitan filed on January 18, 1975 with the Court of First Instance of Negros Occidental a Complaint against petitioners to partition the properties plus damages.

Petitioners set up the defense of prescription with respect to Lot No. 757 as an affirmative defense, contending that the Complaint was filed more than eleven years after the issuance of a transfer certificate of title to Donato Paulmitan over the land as consequence of the registration with the Register of Deeds, of Donato's affidavit extrajudicially adjudicating unto himself Lot No. 757. As regards Lot No. 1091, petitioner Juliana P. Fanesa claimed in her Answer to the Complaint that she acquired exclusive ownership thereof not only by means of a deed of sale executed in her favor by her father, petitioner Donato Paulmitan, but also by way of redemption from the Provincial Government of Negros Occidental.

Acting on the petitioners' affirmative defense of prescription with respect to Lot No. 757, the trial court issued an order dated April 22, 1976 dismissing the complaint as to the said property upon finding merit in petitioners' affirmative defense. This order, which is not the object of the present petition, has become final after respondents' failure to appeal therefrom.

Trial proceeded with respect to Lot No. 1091. In a decision dated May 20, 1977, the trial court decided in favor of respondents as to Lot No. 1091. According to the trial court, the respondents, as descendants of Agatona Sagario Paulmitan were entitled to one-half (1/2) of Lot No. 1091, pro indiviso. The sale by petitioner Donato Paulmitan to his daughter, petitioner Juliana P. Fanesa, did not prejudice their rights. And the repurchase by Juliana P. Fanesa of the land from the Provincial Government of Negros Occidental did not vest in Juliana exclusive ownership over the entire land but only gave her the right to be reimbursed for the amount paid to redeem the property. The trial court ordered the partition of the land and directed petitioners Donato Paulmitan and Juliana P. Fanesa to pay private respondents certain amounts representing the latter's share in the fruits of the land. On the other hand, respondents were directed to pay P1,479.55 to Juliana P. Fanesa as their share in the redemption price paid by Fanesa to the Provincial Government of Negros Occidental. The dispositive portion of the trial court's decision reads:

WHEREFORE, judgment is hereby rendered on the second cause of action pleaded in the complain as follows:

1. The deed of sale (Exh. "F") dated May 28, 1974 is valid insofar as the one-half undivided portion of Lot 1091 is concerned as to vest ownership over said half portion in favor of defendant Juliana Fanesa and her husband Rodolfo Fanesa, while the remaining half shall belong to plaintiffs, pro-indiviso;

2. Lot 1091, Cadastral Survey of Pontevedra, Province of Negros Occidental, now covered by TCT No. RO-11653 (N.A.), is ordered partitioned. The parties must

proceed to an actual partition by property instrument of partition, submitting the corresponding subdivision within sixty (60) days from finality of this decision, and should they fail to agree, commissioners of partition may be appointed by the Court;

3. Pending the physical partition, the Register of Deeds of Negros Occidental is ordered to cancel Original Certificate of Title No. RO-11653 (N.A.) covering Lot 1091, Pontevedra Cadastre, and to issue in lieu thereof a new certificate of title in the name of plaintiffs and defendants, one-half portion each, pro-indiviso, as indicated in paragraph 1 above;

4. Plaintiffs are ordered to pay, jointly and severally, defendant Juliana Fanesa the amount of P1,479.55 with interest at the legal rate from May 28, 1974 until paid;

5 Defendants Donato Sagario Paulmitan and Juliana Paulmitan Fanesa are ordered to account to plaintiffs and to pay them, jointly and severally, the value of the produce from Lot 1091 representing plaintiffs' share in the amount of P5,000.00 per year from 1966 up to the time of actual partition of the property, and to pay them the sum of P2,000.00 as attorney's fees as well as the costs of the suit.

xxx xxx xxx

On appeal, the Court of Appeals affirmed the trial court's decision. Hence this petition.

To determine the rights and obligations of the parties to the land in question, it is well to review, initially, the relatives who survived the decedent Agatona Sagario Paulmitan. When Agatona died in 1953, she was survived by two (2) sons, Donato and Pascual. A few months later in the same year, Pascual died, leaving seven children, the private respondents. On the other had, Donato's sole offspring was petitioner Juliana P. Fanesa.

At the time of the relevant transactions over the properties of decedent Agatona Sagario Paulmitan, her son Pascual had died, survived by respondents, his children. It is, thus, tempting to apply the principles pertaining to the right of representation as regards respondents. It must, however, be borne in mind that Pascual did no predecease his mother, 8 thus precluding the operation of the provisions in the Civil Code on the right of representation 9 with respect to his children, the respondents. When Agatona Sagario Paulmitan died intestate in 1952, her two (2) sons Donato and Pascual were still alive. Since it is well-settled by virtue of Article 777 of the Civil Code that "[t]he rights to the succession are transmitted from the moment of the death of the decedent," 10 the right of ownership, not only of Donato but also of Pascual, over their respective shares in the inheritance was automatically and by operation of law vested in them in 1953 when their mother died intestate. At that stage, the children of Donato and Pascual did not yet have any right over the inheritance since "[i]n every inheritance, the relative nearest in degree excludes the more distantones." 11 Donato and Pascual excluded their children as to the right to inherit from Agatona Sagario Paulmitan, their mother.

From the time of the death of Agatona Sagario Paulmitan to the subsequent passing away of her son Pascual in 1953, the estate remained unpartitioned. Article 1078 of the Civil Code provides: "Where there are two or more heirs, the whole estate of the decedent is, before its partition, owned in common by such heirs, subject to the payment of debts of the deceased." 12 Donato and Pascual Paulmitan were, therefore, co-owners of the estate left by their mother as no partition was ever made.

When Pascual Paulmitan died intestate in 1953, his children, the respondents, succeeded him in the co-ownership of the disputed property. Pascual Paulmitan's right of ownership over an undivided portion of

the property passed on to his children, who, from the time of Pascual's death, became co-owners with their uncle Donato over the disputed decedent estate.

Petitioner Juliana P. Fanesa claims ownership over Lot No. 1091 by virtue of two transactions, namely: (a) the sale made in her favor by her father Donato Paulmitan; and (b) her redemption of the land from the Provincial of Negros Occidental after it was forfeited for non-payment of taxes.

When Donato Paulmitan sold on May 28, 1974 Lot No. 1091 to his daughter Juliana P. Fanesa, he was only a co-owner with respondents and as such, he could only sell that portion which may be allotted to him upon termination of the co-ownership. 13 The sale did not prejudice the rights of respondents to one half (1/2) undivided share of the land which they inherited from their father. It did not vest ownership in the entire land with the buyer but transferred only the seller's pro-indiviso share in the property 14 and consequently made the buyer a co-owner of the land until it is partitioned. InBailon-Casilao v. Court of Appeals, 15 the Court, through Justice Irene R. Cortes, outlined the effects of a sale by one co-owner without the consent of all the co-owners, thus:

The rights of a co-owner of a certain property are clearly specified in Article 493 of the Civil Code, Thus:

Art. 493. Each co-owner shall have the full ownership of his part and of the fruits and benefits pertaining thereto, and he may therefore alienate, assign or mortgage it and even substitute another person its enjoyment, except when personal rights are involved. But the effect of the alienation or mortgage, with respect to the co-owners, shall be limited to the portion which may be allotted to him in the division upon the termination of the co-ownership. [Emphasis supplied.]

As early as 1923, this Court has ruled that even if a co-owner sells the whole property as his, the sale will affect only his own share but not those of the other co-owners who did not consent to the sale [Punsalan v. Boon Liat, 44 Phil. 320 (1923)]. This is because under the aforementioned codal provision, the sale or other disposition affects only his undivided share and the transferee gets only what would correspond to his grantor in the partition of the thing owned in common [Ramirez v. Bautista, 14 Phil. 528 (1909)]. Consequently, by virtue of the sales made by Rosalia and Gaudencio Bailon which are valid with respect to their proportionate shares, and the subsequent transfers which culminated in the sale to private respondent Celestino Afable, the said Afable thereby became a co-owner of the disputed parcel of land as correctly held by the lower court since the sales produced the effect of substituting the buyers in the enjoyment thereof [Mainit v. Bandoy, 14 Phil. 730 (1910)].

From the foregoing, it may be deduced that since a co-owner is entitled to sell his undivided share, a sale of the entire property by one co-owner without the consent of the other co-owners is not null and void. However, only the rights of the co-owner-seller are transferred, thereby making the buyer a co-owner of the property.

Applying this principle to the case at bar, the sale by petitioner Donato Paulmitan of the land to his daughter, petitioner Juliana P. Fanesa, did not give to the latter ownership over the entire land but merely transferred to her the one half (1/2) undivided share of her father, thus making her the co-owner of the land in question with the respondents, her first cousins.

Petitioner Juliana P. Fanesa also claims ownership of the entire property by virtue of the fact that when the Provincial Government of Negros Occidental bought the land after it was forfeited for non-payment of taxes, she redeemed it.

The contention is without merit.

The redemption of the land made by Fanesa did not terminate the co-ownership nor give her title to the entire land subject of the co-ownership. Speaking on the same issue raised by petitioners, the Court, in Adille v. Court of Appeals, 16 resolved the same with the following pronouncements:

The petition raises a purely legal issue: May a co-owner acquire exclusive ownership over the property held in common?

Essentially, it is the petitioners' contention that the property subject of dispute devolved upon him upon the failure of his co-heirs to join him in its redemption within the period required by law. He relies on the provisions of Article 1515 of the old Civil Code, Article 1613 of the present Code, giving the vendee a retro the right to demand redemption of the entire property.

There is no merit in this petition.

The right of repurchase may be exercised by co-owner with respect to his share alone (CIVIL CODE, art. 1612, CIVIL CODE (1889), art. (1514.). While the records show that petitioner redeemed the property in its entirety, shouldering the expenses therefor, that did not make him the owner of all of it. In other words, it did not put to end the existing state of co-ownership (Supra, Art. 489). There is no doubt that redemption of property entails a necessary expense. Under the Civil Code:

Art. 488. Each co-owner shall have a right to compel the other co-owners to contribute to the expenses of preservation of the thing or right owned in common and to the taxes. Any one of the latter may exempt himself from this obligation by renouncing so much of his undivided interest as may be equivalent to his share of the expenses and taxes. No such waiver shall be made if it is prejudicial to the co-ownership.

The result is that the property remains to be in a condition of co-ownership. While a vendee a retro, under Article 1613 of the Code, "may not be compelled to consent to a partial redemption," the redemption by one co-heir or co-owner of the property in its totality does not vest in him ownership over it. Failure on the part of all the co-owners to redeem it entitles the vendee a retro to retain the property and consolidate title thereto in his name (Supra, art. 1607). But the provision does not give to the redeeming co-owner the right to the entire property. It does not provide for a mode of terminating a co-ownership.

Although petitioner Fanesa did not acquire ownership over the entire lot by virtue of the redemption she made, nevertheless, she did acquire the right to reimbursed for half of the redemption price she paid to the Provincial Government of Negros Occidental on behalf of her co-owners. Until reimbursed, Fanesa hold a lien upon the subject property for the amount due her. 17

Finally, petitioners dispute the order of the trial court, which the Court of Appeals affirmed, for them to pay private respondents P5,000.00 per year from 1966 until the partition of the estate which represents the share of private respondents in the fruits of the land. According to petitioners, the land is being leased for P2,000.00 per year only. This assigned error, however raises a factual question. The settled rule is that only questions of law may be raised in a petition for review. As a general rule, findings of fact made by the trial court and the Court of Appeals are final and conclusive and cannot be reviewed on appeal. 18

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

SO ORDERED.

LILIA SANCHEZ, petitioner, vs. COURT OF APPEALS, HON. VICTORINO S. ALVARO as Presiding Judge, RTC-Br. 120, Caloocan City, and VIRGINIA TERIA, respondents.

D E C I S I O N

BELLOSILLO, J.:

This is a Special Civil Action for Certiorari under Rule 65 of the Rules of Court to annul and set aside the Decision of the Court of Appeals dated 23 May 2001 as well as its Resolution dated 8 January 2002 in CA-G.R. SP No. 59182.

Lilia Sanchez, petitioner, constructed a house on a 76-square meter lot owned by her parents-in-law.  The lot was registered under TCT No. 263624 with the following co-owners: Eliseo Sanchez married to Celia Sanchez, Marilyn Sanchez married to Nicanor Montalban, Lilian Sanchez, widow, Nenita Sanchez, single, Susana Sanchez married to Fernando Ramos, and Felipe Sanchez.[1] On 20 February 1995, the lot was registered under TCT No. 289216 in the name of private respondent Virginia Teria by virtue of a Deed of Absolute Sale supposed to have been executed on 23 June 1995 [2] by all six (6) co-owners in her favor.[3] Petitioner claimed that she did not affix her signature on the document and subsequently refused to vacate the lot, thus prompting private respondent Virginia Teria to file an action for recovery of possession of the aforesaid lot with the Metropolitan Trial Court (MeTC) of Caloocan City sometime in September 1995, subsequently raffled to Br. 49 of that court.

On 12 February 1998, the MeTC-Br. 49 of Caloocan City ruled in favor of private respondent declaring that the sale was valid only to the extent of 5/6 of the lot and the other 1/6 remaining as the property of petitioner, on account of her signature in the Deed of Absolute Sale having been established as a forgery.

Petitioner then elevated her appeal to the Regional Trial Court of Caloocan City, subsequently assigned to Br. 120, which ordered the parties to file their respective memoranda of appeal.  Counsel for petitioner did not comply with this order, nor even inform her of the developments in her case.    Petitioner not having filed any pleading with the RTC of Caloocan City, the trial court affirmed the 27 July 1998 decision of the MeTC.

On 4 November 1998, the MeTC issued an order for the issuance of a writ of execution in favor of private respondent Virginia Teria, buyer of the property.   On 4 November 1999 or a year later, a Notice to Vacate was served by the sheriff upon petitioner who however refused to heed the Notice.

On 28 April 1999 private respondent started demolishing petitioner’s house without any special permit of demolition from the court.

Due to the demolition of her house which continued until 24 May 1999 petitioner was forced to inhabit the portion of the premises that used to serve as the house’s toilet and laundry area.

On 29 October 1999 petitioner filed her Petition for Relief from Judgment with the RTC on the ground that she was not bound by the inaction of her counsel who failed to submit petitioner’s appeal memorandum.  However the RTC denied the Petition and the subsequent Motion for Reconsideration.

On 14 June 2000 petitioner filed her Petition for Certiorari with the Court of Appeals alleging grave abuse of discretion on the part of the court a quo.

On 23 May 2001 the appellate court dismissed the petition for lack of merit.  On 18 June 2001 petitioner filed a Motion for Reconsideration but the Court of Appeals denied the motion in its Resolution of 8 January 2002.

The only issue in this case is whether the Court of Appeals committed grave abuse of discretion in dismissing the challenged case before it.

As a matter of policy, the original jurisdiction of this Court to issue the so-called extraordinary writs should generally be exercised relative to actions or proceedings before the Court of Appeals or before constitutional or other tribunals or agencies the acts of which for some reason or other are not controllable by the Court of Appeals. Where the issuance of the extraordinary writ is also within the competence of the Court of Appeals or the Regional Trial Court, it is either of these courts that the specific action for the procurement of the writ must be presented.   However, this Court must be convinced thoroughly that two (2) grounds exist before it gives due course to acertiorari petition under Rule 65: (a) The tribunal, board or officer exercising judicial or quasi-judicial functions has acted without or in excess of its or his jurisdiction; and (b) There is no appeal nor any plain, speedy and adequate remedy in the ordinary course of law.

Despite the procedural lapses present in this case, we are giving due course to this petition as there are matters that require immediate resolution on the merits to effect substantial justice.

The Rules of Court should be liberally construed in order to promote their object of securing a just, speedy and inexpensive disposition of every action or proceeding.[4]

The rules of procedure should be viewed as mere tools designed to aid the courts in the speedy, just and inexpensive determination of the cases before them.  Liberal construction of the rules and the pleadings is the controlling principle to effect substantial justice. [5]Litigations should, as much as possible, be decided on their merits and not on mere technicalities.[6]

Verily, the negligence of petitioner’s counsel cannot be deemed as negligence of petitioner herself in the case at bar.  A notice to a lawyer who appears to have been unconscionably irresponsible cannot be considered as notice to his client.[7] Under the peculiar circumstances of this case, it appears from the records that counsel was negligent in not adequately protecting his client’s interest, which necessarily calls for a liberal construction of the Rules.

The rationale for this approach is explained in Ginete v. Court of Appeals - [8]

This Court may suspend its own rules or exempt a particular case from its operation where the appellate court failed to obtain jurisdiction over the case owing to appellant’s failure to perfect an appeal.  Hence, with more reason would this Court suspend its own rules in cases where the appellate court has already obtained jurisdiction over the appealed case.  This prerogative to relax procedural rules of the most mandatory character in terms of compliance, such as the period to appeal has been invoked and granted in a considerable number of cases x x x xLet it be emphasized that the rules of procedure should be viewed as mere tools designed to facilitate the attainment of justice.  Their strict and rigid application, which would result in technicalities that tend to frustrate rather than promote substantial justice, must always be eschewed. Even the Rules of Court reflect this principle.  The power to suspend or even disregard rules can be so pervasive and compelling as to alter even that which this Court itself has already declared to be final, as we are now constrained to do in the instant case x x x xThe emerging trend in the rulings of this Court is to afford every party litigant the amplest opportunity for the proper and just determination of his cause, free from the constraints of technicalities. Time and again, this Court has consistently held that rules must not be applied rigidly so as not to override substantial justice.

Aside from matters of life, liberty, honor or property which would warrant the suspension of the Rules of the most mandatory character and an examination and review by the appellate court of the lower court’s findings of fact, the other elements that should be considered are the following: (a) the existence of special or compelling circumstances, (b) the merits of the case, (c) a cause not entirely attributable to the fault or negligence of the party favored by the suspension of the rules, (d) a lack of any showing that the review sought is merely frivolous and dilatory, and (e) the other party will not be unjustly prejudiced thereby.[9]

The suspension of the Rules is warranted in this case since the procedural infirmity was not entirely attributable to the fault or negligence of petitioner.  Besides, substantial justice requires that we go into the

merits of the case to resolve the present controversy that was brought about by the absence of any partition agreement among the parties who were co-owners of the subject lot in question. Hence, giving due course to the instant petition shall put an end to the dispute on the property held in common.

In People’s Homesite and Housing Corporation v. Tiongco[10] we held:

There should be no dispute regarding the doctrine that normally notice to counsel is notice to parties, and that such doctrine has beneficent effects upon the prompt dispensation of justice.  Its application to a given case, however, should be looked into and adopted, according to the surrounding circumstances; otherwise, in the court’s desire to make a short-cut of the proceedings, it might foster, wittingly or unwittingly, dangerous collusions to the detriment of justice.  It would then be easy for one lawyer to sell one’s rights down the river, by just alleging that he just forgot every process of the court affecting his clients, because he was so busy.  Under this circumstance, one should not insist that a notice to such irresponsible lawyer is also a notice to his clients.

Thus, we now look into the merits of the petition.

This case overlooks a basic yet significant principle of civil law: co-ownership.   Throughout the proceedings from the MeTC to the Court of Appeals, the notion of co-ownership [11] was not sufficiently dealt with.  We attempt to address this controversy in the interest of substantial justice.   Certiorari should therefore be granted to cure this grave abuse of discretion.

Sanchez Roman defines co-ownership as “the right of common dominion which two or more persons have in a spiritual part of a thing, not materially or physically divided. [12] Manresa defines it as the “manifestation of the private right of ownership, which instead of being exercised by the owner in an exclusive manner over the things subject to it, is exercised by two or more owners and the undivided thing or right to which it refers is one and the same.”[13]

The characteristics of co-ownership are: (a) plurality of subjects, who are the co-owners, (b) unity of or material indivision, which means that there is a single object which is not materially divided, and which is the element which binds the subjects, and, (c) the recognition of ideal shares, which determines the rights and obligations of the co-owners.[14]

In co-ownership, the relationship of such co-owner to the other co-owners is fiduciary in character and attribute.  Whether established by law or by agreement of the co-owners, the property or thing held pro-indiviso is impressed with a fiducial nature so that each co-owner becomes a trustee for the benefit of his co-owners and he may not do any act prejudicial to the interest of his co-owners.[15]

Thus, the legal effect of an agreement to preserve the properties in co-ownership is to create an express trust among the heirs as co-owners of the properties.  Co-ownership is a form of trust and every co-owner is a trustee for the others.[16]

 Before the partition of a land or thing held in common, no individual or co-owner can claim title to any definite portion thereof. All that the co-owner has is an ideal or abstract quota or proportionate share in the entire land or thing.[17]

Article 493 of the Civil Code gives the owner of an undivided interest in the property the right to freely sell and dispose of it, i.e., his undivided interest.  He may validly lease his undivided interest to a third party independently of the other co-owners.[18] But he has no right to sell or alienate a concrete, specific or determinate part of the thing owned in common because his right over the thing is represented by a quota or ideal portion without any physical adjudication.[19]

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

WHEREFORE, the Petition is GRANTED.  The Decision of the Court of Appeals dated 23 May 2001 as well as its Resolution dated 8 January 2002 in CA-G.R. SP No. 59182 is ANNULLED and SET

ASIDE.  A survey of the questioned lot with TCT No. 289216 (formerly TCT No. 263624) by a duly licensed geodetic engineer and the PARTITION of the aforesaid lot are ORDERED.

Let the records of this case be REMANDED to MeTC-Br. 49, Caloocan City to effect the aforementioned survey and partition, as well as segregate the 1/6 portion appertaining to petitioner Lilia Sanchez.

The Deed of Absolute Sale by the other co-owners to Virginia Teria shall be RESPECTED insofar as the other undivided 5/6 portion of the property is concerned.

SO ORDERED.

AURORA DEL BANCO, EVELYN DEL BANCO, FEDERICO TAINO, SOLEDAD TAINO, JOVENCIO TAINO, SAMSON TAINO, NOE TAINO, SOCORRO TAINO and CLEOFAS TAINO, petitioners, vs.INTERMEDIATE APPELLATE COURT (Second Civil Cases Division), ALEJANDRA PANSACOLA, LEONILA ENCALLADO, VEDASTO ENCALLADO, JOSE YEPES, et al., respondents.

 

PARAS, J.:

This is a petition for review on certiorari by way of appeal from: (a) the decision of respondent Court of Appeals (Intermediate Appellate Court) * promulgated on May 17, 1985 in AC-G.R. CV No. 70460, entitled "Alejandra Pansacola, et al. vs. Domen Villabona del Banco, et al." which reversed and set aside the judgment ** of the trial court; and (b) its resolution ** of October 15, 1985 in the same case, denying petitioners' motion for reconsideration of the aforementioned decision and their supplement to motion for reconsideration.

The dispositive portion of the questioned decision (Rollo, p. 97) reads, as follows:

ACCORDINGLY, the decision appealed from is hereby SET ASIDE insofar as it dismisses the complaint, and another one entered —

(1) Declaring plaintiffs-appellants and defendants-appellees, in their respective capacities as described in par. V of the complaint, as co-owners of the property in dispute, but subject to the four-part pro-indiviso division already made by said property;

(2) Ordering the cancellation of all certificates of title that may have been issued to any of the parties hereto; and

(3) Ordering the complete and final partition of the subject property in conformity with law.

For this purpose, this case is hereby remanded to the Court of origin so that a final partition shall be made in accordance with Sections 2, 3, et. seq., Rule 69 of the Rules of Court.

Let a copy of this decision be furnished to the Register of Deeds for the Province of Quezon.

The facts of the case are taken from the decision of the Appellate Court (Rollo, p. 39) as follows:

In a document executed in the Municipality of San Rafael, Bulacan, on February 11, 1859, three brothers, Benedicto Pansacola, Jose Pansacola and Manuel Pansacola (known as Fr. Manuel Pena) entered into an agreement which provided, among others:

(1) That they will purchase from the Spanish Government the lands comprising the Island of Cagbalite which is located within the boundaries of the Municipality of Mauban, Province of Tayabas (now Quezon) and has an approximate area of 1,600 hectares;

(2) That the lands shall be considered after the purchase as their common property;

(3) That the co-ownership includes Domingo Arce and Baldomera Angulo, minors at that time represented by their father, Manuel Pansacola (Fr. Manuel Pena) who will contribute for them in the proposed purchase of the Cagbalite Island;

(4) That whatever benefits may be derived from the Island shall be shared equally by the co-owners in the following proportion: Benedicto Pansacola-1/4 share; Jose Pansacola-1/4 share; and, Domingo Arce and Baldomera Angulo-2/4 shares which shall be placed under the care of their father, Manuel Pansacola (Fr. Manuel Pena).

On August 14, 1866, co-owners entered into the actual possession and enjoyment of the Island purchased by them from the Spanish Government. On April 11, 1868 they agreed to modify the terms and conditions of the agreement entered into by them on February 11, 1859. The new agreement provided for a new sharing and distribution of the lands, comprising the Island of Cagbalite and whatever benefits may be derived therefrom, as follows:

(a) The first one-fourth (1/4) portion shall belong to Don Benedicto Pansacola;

(b) The second one-fourth (1/4) portion shall belong to Don Jose Pansacola;

(c) The third one-fourth(1/4) portion shall henceforth belong to the children of their deceased brother, Don Eustaquio Pansacola, namely: Don Mariano Pansacola,- Maria Pansacola and Don Hipolito Pansacola;

(d) The fourth and last one-fourth (1/4) portion shall belong to their nephews and nieces (1) Domingo Arce, (2) Baldomera Angulo, (3) Marcelina Flores, (4) Francisca Flores, (5) Candelaria dela Cruz, and (6) Gervasio Pansacola who, being all minors, are still under the care of their brother, Manuel Pansacola (Fr. Manuel Pena). The latter is the real father of said minors.

About one hundred years later, on November 18, 1968, private respondents brought a special action for partition in the Court of First Instance of Quezon, under the provisions of Rule 69 of the Rules of Court, including as parties the heirs and successors-in-interest of the co-owners of the Cagbalite Island in the second contract of co-ownership dated April 11, 1968. In their answer some of the defendants, petitioners herein, interposed such defenses as prescription, res judicata, exclusive ownership, estoppel and laches.

After trial on the merits, the trial court rendered a decision *** dated November 6, 1981 dismissing the complaint, the dispositive portion of which reads as follows:

WHEREFORE, and in the fight of all the foregoing this Court finds and so holds that the Cagbalite Island has already been partitioned into four (4) parts among the original co-owners or their successors-in-interest.

Judgment is therefore rendered for the defendants against the plaintiffs dismissing the complaint in the above entitled case.

Considering that the cross claims filed in the above entitled civil case are not compulsory cross claims and in order that they may be litigated individually the same are hereby dismissed without prejudice.

IT IS SO ORDERED.

The motion for reconsideration filed by the plaintiffs, private respondents herein, was denied by the trial court in an order dated February 25, 1982 (Record on Appeal, p. 241).

On appeal, respondent Court reversed and set aside the decision of the lower court (Rollo, p. 117). It also denied the motion for reconsideration and the supplement to motion for reconsideration filed by private respondents, in its resolution dated October 15, 1983 (Rollo, p. 86).

Instant petition was filed with the Court on December 5, 1985 (Rollo, p. 12). Petitioners Josefina Pansacola, et al. having filed a separate petition (G.R. No. 72620) on the same subject matter and issues raised in the instant 'petition, the counsel for private respondents filed a consolidated comment on the separate petitions for review on February 24, 1986 with the First Division of the Court (Rollo, p. 119). It appears that counsel for petitioners also filed a consolidated reply to the consolidated comment of private respondents as required by the Second Division of the Court (Rollo, p. 151). However, petitioners filed a separate reply in the instant case on February 18,1987 (Rollo, p. 168)as required by the Court in a Resolution of the Second Division dated November 24, 1986 (Rollo, p. 160).

On May 19, 1987, private respondents in the instant petition filed a manifestation praying for the denial of the instant petition in the same manner that G.R. No. 72620 was denied by the Court in its Resolution dated July 23, 1986 (Rollo, p. 151). Their rejoinder to the reply of petitioners was filed on May 25,1987 (Rollo, p. 179).

On June 8, 1987, the Court resolved to give due course to the petition (Rollo, p. 192). The memorandum of private respondents was mailed on July 18, 1987 and received in the Court on July 29, 1987 (Rollo, p. 112); the memorandum for petitioners was mailed on August 18, 1987 and received in the Court on September 7, 1987 (Rollo, p. 177).

The sole issue to be resolved by the Court is the question of whether or not Cagbalite Island is still undivided property owned in common by the heirs and successors-in-interest of the brothers, Benedicto, Jose and Manuel Pansacola.

The Pansacola brothers purchased the Island in 1859 as common property and agreed on how they would share in the benefits to be derived from the Island. On April 11, 1868, they modified the terms and conditions of the agreement so as to include in the co-ownership of the island the children of their deceased brothers Eustaquio and the other children of Manuel Pansacola (Fr. Manuel Pena) who were committed in the agreement of February 11, 1859. The new agreement provided for a new sharing proportion and distribution of the Island among the co-owners.

On January 20, 1907, the representative of the heirs of all the original owners of Cagbalite Island entered into an agreement to partition the Island, supplemented by another agreement dated April 18, 1908. The contract dated January 20, 1907 provides as follows:

Sa Mauban, Tayabas, ika 20 ng Enero ng 1907 caming mga quinatawan ng mga ibang co-herederos na hindi caharap, sa pulong na ito, sa nasa naming lahat na magcaroon na ng catahimikan ang aming-aming cabahagui sa Pulong Kagbalete sumacatuid upang mapagtoos ang hangahan ng apat na sapul na pagcacabahagui nitong manang ito, pagcacausap na naming lahat at maihanay at mapagtalonan ang saysay ng isa't isa, ay cusa naming pinagcasunduan at pinasiya ang nangasosonod:—

Una: Ang malaquing calupaan, alis ang lahat na pacatan ay babahaguin alinsunod sa pagcabaki na guinawa sa croquis na niyari ng practico agrimensor Don Jose Garcia.

Icalawa: Ang Lomingoy, doon ang tuid na guhit sa ilong ng Pait ay pagaapatin ding sinlaqui ayon sa dating pagkakabaki.

Icatlo: Cung magawa na ang tunay na piano at icapit na sa lupa, paglalagay ng nadarapat na mojon, ang masacupan ng guhit, sumacatuid ang caingin at pananim ng isa na nasacupan ng pucto na noocol sa iba, ay mapapasulit sa dapat mag-ari, na pagbabayaran nito ang nagtanim sa halagang:- bawat caponong niog na nabunga, P 1.00 'un peso); cung ang bias ay abot sa isang vara, P 0.50; cung bagong tanim o locloc P 0. 50 ang capono.

Icapat: Ang lahat na pacatan ay bacod na pagaapatin at bawat bahagui ay noocol sa isat-isa sa apat na sanga ng paganacang nagmana.

Icalima: Upang ang naipatanim ng bawat isa ay matama sa canya ng mailagan ang hirap ng loob ng nagatikha; ay pagtotolong-tolongan ng lahat naiba na mahusay ang dalawang partes na magcalapit na mapa ayong tumama, hangang may pagluluaran, sa nagsikap at maoyanam, maidaco sa lugar na walang cailangang pagusapan.

Icanim: Ang casulatang ito, cung mapermahan na na magcacaharap sampong ng mga ibang co-herederos na notipicahan nitong lahat na pinagcasundoan ay mahahabilin sa camay ng agrimensor, Amadeo Pansacola, upang canyang mapanusugan ang maipaganap ang dito'y naootos.

Na sa catunayan at catibayan ng lahat na nalalagda dito, sa pag galang at pag ganap dito sa paingacaisahan ay pumirma sampo ng mga sacsing caharap at catanto ngayong fecha ayon sa itaas.

The contract dated April 18, 1908 provides as follows:

Sa Mauban, ika 18 ng Abril ng 1908, sa pagcacatipon ng lahat na firmantes nito ay pinagcaisahan itong nangasosonod:—

Una — Pinagtitibay ang mga pinagcasundoan sa itaas noong 20 ng Enero ng 1907, liban na lamang sa mga pangcat na una at icapat at tongcol doon pinasiya naming bahaguinin ng halohalo at paparejo ang calupaan at pacatan.

Ycalawa — Sa pagsucat ng agrimensor na si Amadeo at paggawa ng piano at descripcion ay pagbabayaran siya ng sa bawat isa naoocol sa halagang isang piso sa bawat hectares.

Icatlo — Ang counting pucto sa 'Mayanibulong' na may caingin ni G. Isidro Altamarino, asawa ni Restitute ay tutumbasan naman cay G. Norberto Pansacola sa lugar ng Dapo calapit ng Pinangalo ng gasing sucat.

Icapat — Sa inilahad na piano ay pinasiya nang itoloy at upang maca pagparehistro ang isa't isa ay pinagcaisahang magcacagastos na parepareho para sa tablang pangmohon at ibat iba pang cagastusan.

Sa catunayan at catibayan ay cami, pumirma. (Record on Appeal, p. 224)

There is nothing in all four agreements that suggests that actual or physical partition of the Island had really been made by either the original owners or their heirs or successors-in-interest. The agreement entered into in 1859 simply provides for the sharing of whatever benefits can be derived from the island. The agreement, in fact, states that the Island to be purchased shall be considered as their common property. In the second agreement entered in 1868 the co-owners agreed not only on the sharing proportion of the benefits derived from the Island but also on the distribution of the Island each of the brothers was allocated a 1/4 portion of the Island with the children of the deceased brother, Eustaquio Pansacola allocated a 1/4 portion and the children of Manuel Pansacola (Fr. Manuel Pena) also allocated a 1/4 portion of the Island. With the distribution agreed upon each of the co-owner is a co-owner of the whole, and in this sense, over the whole he exercises the right of dominion, but he is at the same time the sole owner of a portion, in the instant case, a 1/4 portion (for each group of co-owners) of the Island which is truly abstract, because until physical division is effected such portion is merely an Ideal share, not concretely determined (3 Manresa, Codigo Civil, 3rd Ed., page 486, cited in Lopez vs. Cuaycong, 74 Phil. 601; De la Cruz vs. Cruz, 32 SCRA 307 [1970]; Felices vs. Colegado, 35 SCRA 173 [1970],; Dultra vs. CFl 70 SCRA 465 [1976]; Gatchalian vs. Arlegui, 75 SCRA 234 [1977].)

In the agreement of January 20, 1907, the heirs that were represented agreed on how the Island was to be partitioned. The agreement of April 18, 1908 which supplements that of January 20, 1907 reveals that as of the signing of the 1908 agreement no actual partition of the Island had as yet been done. The second and fourth paragraphs of the agreement speaks of a survey yet to be conducted by a certain Amadeo and a plan and description yet to be made. Virgilio Pansacola, a son of the surveyor named Amadeo who is referred to in the contract dated April 18, 1908 as the surveyor to whom the task of surveying Cagbalite Island pursuant to said agreement was entrusted, however, testified that said contracts were never implemented because nobody defrayed the expenses for surveying the same (Record on Appeal, p. 225).

Petitioners invoke res judicata to bar this action for partition in view of the decision of the Court in G.R. No. 21033,"Domingo Arce vs. Maria Villabona, et al.," 21034, "Domingo Arce vs. Francisco Pansacola, et al.," and 21035,"Domingo Arce vs. Emiliano Pansacola, et al." promulgated on February 20, 1958 (Rollo, p. 141) and Brief for Defendants-Appellees, p. 87 Appendix 1), wherein the Court said:

Considering the facts that he waited for a period of nearly 23 years after the return from his deportation before taking any positive action to recover his pretended right in the property in question, gives great credit, in our opinion, to the declaration of the witnesses for the defense (a) that the original parcel of land was partitioned as they claim, and (b) that the plaintiff had disposed of all the right and interest which he had in the portion which had been given to him.

The issue in the aforementioned case which were tried together is not whether there has already been a partition of the Cagbalite Island. The actions were brought by the plaintiff to recover possession of three

distinct parcels of land, together with damages. In fact the word partition was used in the metaphysical or Ideal sense (not in its physical sense).

Commenting on the above ruling of the Court in connection with the instant case, the respondent Court said:

Concededly, the Supreme Court decision in G.R. Nos. 21033-35 (Exh. X) did use or employ the word "partition." A careful reading of the said decision will, however, reveal, and we so hold, that the employment or use of the word "partition" therein was made not in its technical and legal meaning or sense adverted to above, but, rather in its Ideal, abstract and spiritual sense, this is (at) once evident from the bare statement in said decision to the effect that the property was divided into four parts, without any reference to the specific parts of the property that may have been adjudicated to each owner. There being no such reference in the decision and in the judgment affirmed therein to the adjudication of specific and definite portions of the property to each co-owner, there is a clear and logical inference that there was indeed no adjudication of specific and definite portions of the property made to each co-owner.

It must be admitted that the word "partition" is not infrequently used both in popular and technical parlance (Fule vs. Fule, 52 Phil. 750 [1929]). For purposes of the aforementioned case, evidently the Court used the word "partition" to refer to the distribution of the Cagbalite Island agreed upon by the original owners and in the later agreements, by the heirs and their subsequent successors-in-interest. There need not be a physical partition; a distribution of the Island even in a state of indiviso or was sufficient in order that a co-owner may validly sell his portion of the co-owned property. The sale of part of a particular lot thus co-owned by one co-owner was within his right pro-indiviso is valid in its entirety (Pamplona vs. Moreto, 96 SCRA 775 [1980]) but he may not convey a physical portion with boundaries of the land owned in common (Mercado vs. Liwanag, 5 SCRA 472 [1962]). Definitely, there was no physical partition of the Island in 1859. Neither could there have been one in 1894 because the manner of subdividing the Island was only provided for in the later agreements entered into by the heirs in 1907 and 1908. There was a distribution of the Island in 1868 as agreed upon by the original co-owners in their agreement of April 11, 1868. Any agreement entered into by the parties in 1894 could be no more than another agreement as to the distribution of the Island among the heirs of the original co-owners and the preparation of a tentative plan by a practical surveyor, a Mr. Jose Garcia, mentioned in the first paragraph of the 1907 agreement, preparatory to the preparation of the real plan to be prepared by the surveyor Amadeo, mentioned in the agreement of April 18, 1908.

What is important in the Court's ruling in the three aforementioned cases is that, the fact that there was a distribution of the Island among the co-owners made the sale of Domingo Arce of the portion allocated to him though pro-indiviso, valid. He thus disposed of all his rights and interests in the portion given to him.

It is not disputed that some of the private respondents and some of the petitioners at the time the action for partition was filed in the trial court have been in actual possession and enjoyment of several portions of the property in question (Rollo, p. 148). This does not provide any proof that the Island in question has already been actually partitioned and co-ownership terminated. A co-owner cannot, without the conformity of the other co-owners or a judicial decree of partition issued pursuant to the provision of Rule 69 of the Rules of Court (Rule 71 of the Old Rules), adjudicate to himself in fee simple a determinate portion of the lot owned in common, as his share therein, to the exclusion of other co-owners (Santos, Jr. vs. Buenconsejo, 14 SCRA 407 [1965]; Carvajal vs. Court of Appeals, 112 SCRA 237 [1982]). It is a basic principle in the law of co-ownership both under the present Civil Code as in the Code of 1889 that no individual co- owner can claim any definite portion thereof (Diversified Credit Corporation vs. Rosada 26 SCRA 470 [1968]). lt is therefore of no moment that some of the co-owners have succeeded in securing cadastral titles in their names to some portions of the Island occupied by them (Rollo, p. 10).

It is not enough that the co-owners agree to subdivide the property. They must have a subdivision plan drawn in accordance with which they take actual and exclusive possession of their respective portions in the plan and titles issued to each of them accordingly (Caro vs. Court of Appeals, 113 SCRA 10 [1982]). The mechanics of actual partition should follow the procedure laid down in Rule 69 of the Rules of Court. Maganon vs. Montejo, 146 SCRA 282 [1986]).

Neither can such actual possession and enjoyment of some portions of the Island by some of the petitioners herein be considered a repudiation of the co-ownership. It is undisputed that the Cagbalite Island was purchased by the original co-owners as a common property and it has not been proven that the Island had been partitioned among them or among their heirs. While there is co-ownership, a co-owner's possession of his share is co-possession which is linked to the possession of the other co-owners (Gatchalian vs. Arlegui, 75 SCRA 234 [1977]).

Furthermore, no prescription shall run in favor of a co-owner against his co-owners or co-heirs so long as he expressly or impliedly recognizes the co-ownership (Valdez vs. Olonga, 51 SCRA 71 [1973], Tero vs. Tero, 131 SCRA 100 [1984]). Co-owners cannot acquire by prescription the share of the other co-owners, absent a clear repudiation of the co-ownership clearly communicated to the other co-owners (Mariano vs. De Vega, 148 SCRA 342 [1987]).

An action for partition does not prescribe. Article 403 of the Old Civil Code, now Article 497, provides that the assignees of the co-owners may take part in the partition of the common property, and Article 400 of the Old Code, now Article 494 provides that each co-owner may demand at any time the partition of the common property, a provision which implies that the action to demand partition is imprescriptible or cannot be barred by laches (Budlong vs. Pondoc, 79 SCRA 24 [1977]). An action for partition does not lie except when the co-ownership is properly repudiated by the co- owner (Jardin vs. Hollasco, 117 SCRA 532 [1982]).

On July 23, 1986, the Court through its Second Division denied the petition for the review of G.R. No. 72620, the petition for review on certiorari separately filed by Josefina Pansacola (Rollo, p. 151).

PREMISES CONSIDERED, the instant petition is likewise DENIED for lack of merit.

SO ORDERED.

CORNELIO PAMPLONA alias GEMINIANO PAMPLONA and APOLONIA ONTE, petitioners, vs.VIVENCIO MORETO, VICTOR MORETO, ELIGIO MORETO, MARCELO MORETO, PAULINA MORETO, ROSARIO MORETO, MARTA MORETO, SEVERINA MENDOZA, PABLO MENDOZA, LAZARO MENDOZA, VICTORIA TUIZA, JOSEFINA MORETO, LEANDRO MORETO and LORENZO MENDOZA, respondents.

E.P. Caguioa for petitioners.

Benjamin C. Yatco for respondents.

 

GUERRERO, J.:

This is a petition for certiorari by way of appeal from the decision of the Court of Appeals 1 in CA-G.R. No. 35962-R, entitled "Vivencio Moreto, et al., Plaintiff-Appellees vs. Cornelio Pamplona, et al.,

Defendants-Appellants," affirming the decision of the Court of First Instance of Laguna, Branch I at Biñan.

The facts, as stated in the decision appealed from, show that:

Flaviano Moreto and Monica Maniega were husband and wife. During their marriage, they acquired adjacent lots Nos. 1495, 4545, and 1496 of the Calamba Friar Land Estate, situated in Calamba, Laguna, containing 781-544 and 1,021 square meters respectively and covered by certificates of title issued in the name of "Flaviano Moreto, married to Monica Maniega."

The spouses Flaviano Moreto and Monica Maniega begot during their marriage six (6) children, namely, Ursulo, Marta, La Paz, Alipio, Pablo, and Leandro, all surnamed Moreto.

Ursulo Moreto died intestate on May 24, 1959 leaving as his heirs herein plaintiffs Vivencio, Marcelo, Rosario, Victor, Paulina, Marta and Eligio, all surnamed Moreto.

Marta Moreto died also intestate on April 30, 1938 leaving as her heir plaintiff Victoria Tuiza.

La Paz Moreto died intestate on July 17, 1954 leaving the following heirs, namely, herein plaintiffs Pablo, Severina, Lazaro, and Lorenzo, all surnamed Mendoza.

Alipio Moreto died intestate on June 30, 1943 leaving as his heir herein plaintiff Josefina Moreto.

Pablo Moreto died intestate on April 25, 1942 leaving no issue and as his heirs his brother plaintiff Leandro Moreto and the other plaintiffs herein.

On May 6, 1946, Monica Maniega died intestate in Calamba, Laguna.

On July 30, 1952, or more than six (6) years after the death of his wife Monica Maniega, Flaviano Moreto, without the consent of the heirs of his said deceased wife Monica, and before any liquidation of the conjugal partnership of Monica and Flaviano could be effected, executed in favor of Geminiano Pamplona, married to defendant Apolonia Onte, the deed of absolute sale (Exh. "1") covering lot No. 1495 for P900.00. The deed of sale (Exh. "1") contained a description of lot No. 1495 as having an area of 781 square meters and covered by transfer certificate of title No. 14570 issued in the name of Flaviano Moreto, married to Monica Maniega, although the lot was acquired during their marriage. As a result of the sale, the said certificate of title was cancelled and a new transfer certificate of title No. T-5671 was issued in the name of Geminiano Pamplona married to Apolonia Onte (Exh. "A").

After the execution of the above-mentioned deed of sale (Exh. "1"), the spouses Geminiano Pamplona and Apolonia Onte constructed their house on the eastern part of lot 1496 as Flaviano Moreto, at the time of the sale, pointed to it as the land which he sold to Geminiano Pamplona. Shortly thereafter, Rafael Pamplona, son of the spouses Geminiano Pamplona and Apolonia Onte, also built his house within lot 1496 about one meter from its boundary with the adjoining lot. The vendor Flaviano Moreto and the vendee Geminiano Pamplona thought all the time that the portion of 781 square meters which was the subject matter of their sale transaction was No. 1495 and so lot No. 1495 appears to be the subject matter in the deed of sale (Exh. "1") although the fact is that the said portion sold thought of by the parties to be lot No. 1495 is a part of lot No. 1496.

From 1956 to 1960, the spouses Geminiano Pamplona and Apolonio Onte enlarged their house and they even constructed a piggery corral at the back of their said house about one and one-half meters from the eastern boundary of lot 1496.

On August 12, 1956, Flaviano Moreto died intestate. In 1961, the plaintiffs demanded on the defendants to vacate the premises where they had their house and piggery on the ground that Flaviano Moreto had no right to sell the lot which he sold to Geminiano Pamplona as the same belongs to the conjugal partnership of Flaviano and his deceased wife and the latter was already dead when the sale was executed without the consent of the plaintiffs who are the heirs of Monica. The spouses Geminiano Pamplona and Apolonia Onte refused to vacate the premises occupied by them and hence, this suit was instituted by the heirs of Monica Maniega seeking for the declaration of the nullity of the deed of sale of July 30, 1952 above-mentioned as regards one-half of the property subject matter of said deed; to declare the plaintiffs as the rightful owners of the other half of said lot; to allow the plaintiffs to redeem the one-half portion thereof sold to the defendants. "After payment of the other half of the purchase price"; to order the defendants to vacate the portions occupied by them; to order the defendants to pay actual and moral damages and attorney's fees to the plaintiffs; to order the defendants to pay plaintiffs P120.00 a year from August 1958 until they have vacated the premises occupied by them for the use and occupancy of the same.

The defendants claim that the sale made by Flaviano Moreto in their favor is valid as the lot sold is registered in the name of Flaviano Moreto and they are purchasers believing in good faith that the vendor was the sole owner of the lot sold.

After a relocation of lots 1495, 1496 and 4545 made by agreement of the parties, it was found out that there was mutual error between Flaviano Moreto and the defendants in the execution of the deed of sale because while the said deed recited that the lot sold is lot No. 1495, the real intention of the parties is that it was a portion consisting of 781 square meters of lot No. 1496 which was the subject matter of their sale transaction.

After trial, the lower court rendered judgment, the dispositive part thereof being as follows:

WHEREFORE, judgment is hereby rendered for the plaintiffs declaring the deed of absolute sale dated July 30, 1952 pertaining to the eastern portion of Lot 1496 covering an area of 781 square meters null and void as regards the 390.5 square meters of which plaintiffs are hereby declared the rightful owners and entitled to its possession.

The sale is ordered valid with respect to the eastern one-half (1/2) of 1781 square meters of Lot 1496 measuring 390.5 square meters of which defendants are declared lawful owners and entitled to its possession.

After proper survey segregating the eastern one-half portion with an area of 390.5 square meters of Lot 1496, the defendants shall be entitled to a certificate of title covering said portion and Transfer Certificate of Title No. 9843 of the office of the Register of Deeds of Laguna shall be cancelled accordingly and new titles issued to the plaintiffs and to the defendants covering their respective portions.

Transfer Certificate of Title No. 5671 of the office of the Register of Deeds of Laguna covering Lot No. 1495 and registered in the name of Cornelio Pamplona, married to Apolonia Onte, is by virtue of this decision ordered cancelled. The defendants are ordered to surrender to the office of the Register of Deeds of Laguna the owner's duplicate of Transfer Certificate of Title No. 5671 within thirty (30) days after this decision shall have become final for cancellation in accordance with this decision.

Let copy of this decision be furnished the Register of Deeds for the province of Laguna for his information and guidance.

With costs against the defendants. 2

The defendants-appellants, not being satisfied with said judgment, appealed to the Court of Appeals, which affirmed the judgment, hence they now come to this Court.

The fundamental and crucial issue in the case at bar is whether under the facts and circumstances duly established by the evidence, petitioners are entitled to the full ownership of the property in litigation, or only one-half of the same.

There is no question that when the petitioners purchased the property on July 30, 1952 from Flaviano Moreto for the price of P900.00, his wife Monica Maniega had already been dead six years before, Monica having died on May 6, 1946. Hence, the conjugal partnership of the spouses Flaviano Moreto and Monica Maniega had already been dissolved. (Article 175, (1) New Civil Code; Article 1417, Old Civil Code). The records show that the conjugal estate had not been inventoried, liquidated, settled and divided by the heirs thereto in accordance with law. The necessary proceedings for the liquidation of the conjugal partnership were not instituted by the heirs either in the testate or intestate proceedings of the deceased spouse pursuant to Act 3176 amending Section 685 of Act 190. Neither was there an extra-judicial partition between the surviving spouse and the heirs of the deceased spouse nor was an ordinary action for partition brought for the purpose. Accordingly, the estate became the property of a community between the surviving husband, Flaviano Moreto, and his children with the deceased Monica Maniega in the concept of a co-ownership.

The community property of the marriage, at the dissolution of this bond by the death of one of the spouses, ceases to belong to the legal partnership and becomes the property of a community, by operation of law, between the surviving spouse and the heirs of the deceased spouse, or the exclusive property of the widower or the widow, it he or she be the heir of the deceased spouse. Every co-owner shall have full ownership of his part and in the fruits and benefits derived therefrom, and he therefore may alienate, assign or mortgage it, and even substitute another person in its enjoyment, unless personal rights are in question. (Marigsa vs. Macabuntoc, 17 Phil. 107)

In Borja vs. Addision, 44 Phil. 895, 906, the Supreme Court said that "(t)here is no reason in law why the heirs of the deceased wife may not form a partnership with the surviving husband for the management and control of the community property of the marriage and conceivably such a partnership, or rather community of property, between the heirs and the surviving husband might be formed without a written agreement." In Prades vs. Tecson, 49 Phil. 230, the Supreme Court held that "(a)lthough, when the wife dies, the surviving husband, as administrator of the community property, has authority to sell the property withut the concurrence of the children of the marriage, nevertheless this power can be waived in favor of �the children, with the result of bringing about a conventional ownership in common between the father and children as to such property; and any one purchasing with knowledge of the changed status of the property will acquire only the undivided interest of those members of the family who join in the act of conveyance.

It is also not disputed that immediately after the execution of the sale in 1952, the vendees constructed their house on the eastern part of Lot 1496 which the vendor pointed out to them as the area sold, and two weeks thereafter, Rafael who is a son of the vendees, also built his house within Lot 1496. Subsequently, a cemented piggery coral was constructed by the vendees at the back of their house about one and one-half meters from the eastern boundary of Lot 1496. Both vendor and vendees believed all the time that the area of 781 sq. meters subject of the sale was Lot No. 1495 which according to its title (T.C.T. No. 14570) contains an area of 781 sq. meters so that the deed of sale between the parties Identified and described the land sold as Lot 1495. But actually, as verified later by a surveyor upon agreement of the parties during the proceedings of the case below, the area sold was within Lot 1496.

Again, there is no dispute that the houses of the spouses Cornelio Pamplona and Apolonia Onte as well as that of their son Rafael Pamplona, including the concrete piggery coral adjacent thereto, stood on the land from 1952 up to the filing of the complaint by the private respondents on July 25, 1961, or a period of

over nine (9) years. And during said period, the private respondents who are the heirs of Monica Maniega as well as of Flaviano Moreto who also died intestate on August 12, 1956, lived as neighbors to the petitioner-vendees, yet lifted no finger to question the occupation, possession and ownership of the land purchased by the Pamplonas, so that We are persuaded and convinced to rule that private respondents are in estoppel by laches to claim half of the property, in dispute as null and void. Estoppel by laches is a rule of equity which bars a claimant from presenting his claim when, by reason of abandonment and negligence, he allowed a long time to elapse without presenting the same. (International Banking Corporation vs. Yared, 59 Phil. 92)

We have ruled that at the time of the sale in 1952, the conjugal partnership was already dissolved six years before and therefore, the estate became a co-ownership between Flaviano Moreto, the surviving husband, and the heirs of his deceased wife, Monica Maniega. Article 493 of the New Civil Code is applicable and it provides a follows:

Art. 493. Each co-owner shall have the full ownership of his part and of the fruits and benefits pertaining thereto, and he may therefore alienate, assign or mortgage it, and even substitute another person in its enjoyment, except when personal rights are involve. But the effect of the alienation or the mortgage, with respect to the co-owners, shall be limited to the portion which may be allotted to him in the division upon the termination of the co-ownership.

We agree with the petitioner that there was a partial partition of the co-ownership when at the time of the sale Flaviano Moreto pointed out the area and location of the 781 sq. meters sold by him to the petitioners-vendees on which the latter built their house and also that whereon Rafael, the son of petitioners likewise erected his house and an adjacent coral for piggery.

Petitioners point to the fact that spouses Flaviano Moreto and Monica Maniega owned three parcels of land denominated as Lot 1495 having an area of 781 sq. meters, Lot 1496 with an area of 1,021 sq. meters, and Lot 4545 with an area of 544 sq. meters. The three lots have a total area of 2,346 sq. meters. These three parcels of lots are contiguous with one another as each is bounded on one side by the other, thus: Lot 4545 is bounded on the northeast by Lot 1495 and on the southeast by Lot 1496. Lot 1495 is bounded on the west by Lot 4545. Lot 1496 is bounded on the west by Lot 4545. It is therefore, clear that the three lots constitute one big land. They are not separate properties located in different places but they abut each other. This is not disputed by private respondents. Hence, at the time of the sale, the co-ownership constituted or covered these three lots adjacent to each other. And since Flaviano Moreto was entitled to one-half pro-indiviso of the entire land area or 1,173 sq. meters as his share, he had a perfect legal and lawful right to dispose of 781 sq. meters of his share to the Pamplona spouses. Indeed, there was still a remainder of some 392 sq. meters belonging to him at the time of the sale.

We reject respondent Court's ruling that the sale was valid as to one-half and invalid as to the other half for the very simple reason that Flaviano Moreto, the vendor, had the legal right to more than 781 sq. meters of the communal estate, a title which he could dispose, alienate in favor of the vendees-petitioners. The title may be pro-indiviso or inchoate but the moment the co-owner as vendor pointed out its location and even indicated the boundaries over which the fences were to be erectd without objection, protest or complaint by the other co-owners, on the contrary they acquiesced and tolerated such alienation, occupation and possession, We rule that a factual partition or termination of the co-ownership, although partial, was created, and barred not only the vendor, Flaviano Moreto, but also his heirs, the private respondents herein from asserting as against the vendees-petitioners any right or title in derogation of the deed of sale executed by said vendor Flaiano Moreto.

Equity commands that the private respondents, the successors of both the deceased spouses, Flaviano Moreto and Monica Maniega be not allowed to impugn the sale executed by Flaviano Moreto who indisputably received the consideration of P900.00 and which he, including his children, benefitted from the same. Moreover, as the heirs of both Monica Maniega and Flaviano Moreto, private respondents are duty-bound to comply with the provisions of Articles 1458 and 1495, Civil Code, which is the obligation

of the vendor of the property of delivering and transfering the ownership of the whole property sold, which is transmitted on his death to his heirs, the herein private respondents. The articles cited provide, thus:

Art. 1458. By the contract of sale one of the contracting parties obligates himself to transfer the ownership of and to deliver a determinate thing, and the other part to pay therefore a price certain in money or its equivalent.

A contract of sale may be absolute or conditionial.

Art. 1495. The vendor is bound to transfer the ownership of and deliver, as well as warrant the thing which is the object of the sale.

Under Article 776, New Civil Code, the inheritance which private respondents received from their deceased parents and/or predecessors-in-interest included all the property rights and obligations which were not extinguished by their parents' death. And under Art. 1311, paragraph 1, New Civil Code, the contract of sale executed by the deceased Flaviano Moreto took effect between the parties, their assigns and heirs, who are the private respondents herein. Accordingly, to the private respondents is transmitted the obligation to deliver in full ownership the whole area of 781 sq. meters to the petitioners (which was the original obligation of their predecessor Flaviano Moreto) and not only one-half thereof. Private respondents must comply with said obligation.

The records reveal that the area of 781 sq. meters sold to and occupied by petitioners for more than 9 years already as of the filing of the complaint in 1961 had been re-surveyed by private land surveyor Daniel Aranas. Petitioners are entitled to a segregation of the area from Transfer Certificate of Title No. T-9843 covering Lot 1496 and they are also entitled to the issuance of a new Transfer Certificate of Title in their name based on the relocation survey.

WHEREFORE, IN VIEW OF THE FOREGOING, the judgment appealed from is hereby AFFIRMED with modification in the sense that the sale made and executed by Flaviano Moreto in favor of the petitioners-vendees is hereby declared legal and valid in its entirely.

Petitioners are hereby declared owners in full ownership of the 781 sq. meters at the eastern portion of Lot 1496 now occupied by said petitioners and whereon their houses and piggery coral stand.

The Register of Deeds of Laguna is hereby ordered to segregate the area of 781 sq. meters from Certificate of Title No. 9843 and to issue a new Transfer Certificate of Title to the petitioners covering the segregated area of 781 sq. meters.

No costs.

SO ORDERED.

SPOUSES MANUEL and SALVACION DEL CAMPO, petitioners, vs. HON. COURT OF APPEALS and HEIRS OF JOSE REGALADO, SR., respondents.

D E C I S I  O N

QUISUMBING, J.:

This is a petition for review on certiorari of a decision of the Court of Appeals which affirmed the judgment of the Regional Trial Court of Roxas City, Branch 15 in Civil Case No. V-5369, ordering the dismissal of the action for repartition, resurvey and reconveyance filed by petitioners.

Pure questions of law are raised in this appeal as the following factual antecedents are undisputed:

Salome, Consorcia, Alfredo, Maria, Rosalia, Jose, Quirico and Julita, all surnamed Bornales, were the original co-owners of Lot 162 of the Cadastral Survey of Pontevedra, Capiz under Original Certificate of Title No. 18047. As appearing therein, the lot, which consisted of a total area of 27,179 square meters was divided in aliquot shares among the eight (8) co-owners as follows:

Salome Bornales                   4/16Consorcia Bornales              4/16Alfredo Bornales                   2/16Maria Bornales                      2/16Jose Bornales                         1/16Quirico Bornales                   1/16Rosalia Bornales                   1/16Julita Bornales                       1/16

On July 14, 1940, Salome sold part of her 4/16 share in Lot 162 for P200.00 to Soledad Daynolo. In the Deed of Absolute Sale signed by Salome and two other co-owners, Consorcia and Alfredo, the portion of Lot 162 sold to Soledad was described as having more or less the following measurements:

63-1/2 meters from point “9” to “10”, 35 meters from point “10” to point “11”, 30 meters from point “11” to a certain point parallel to a line drawn from points “9” to "10”; and then from this “Certain Point” to point “9” and as shown in the accompanying sketch, and made an integral part of this deed, to SOLEDAD DAYNOLO, her heirs and assigns.[1]

Thereafter, Soledad Daynolo immediately took possession of the land described above and built a house thereon. A few years later, Soledad and her husband, Simplicio Distajo, mortgaged the subject portion of Lot 162 as security for a P400.00 debt to Jose Regalado, Sr. This transaction was evidenced by a Deed of Mortgage[2] dated May 1, 1947.

On April 14, 1948, three of the eight co-owners of Lot 162, specifically, Salome, Consorcia and Alfredo, sold 24,993 square meters of said lot to Jose Regalado, Sr.

On May 4, 1951, Simplicio Distajo, heir of Soledad Daynolo who had since died, paid the mortgage debt and redeemed the mortgaged portion of Lot 162 from Jose Regalado, Sr. The latter, in turn, executed a Deed of Discharge of Mortgage [3] in favor of Soledad’s heirs, namely: Simplicio Distajo, Rafael Distajo and Teresita Distajo-Regalado. On same date, the said heirs sold the redeemed portion of Lot 162 for P1,500.00 to herein petitioners, the spouses Manuel Del Campo and Salvacion Quiachon.

Meanwhile, Jose Regalado, Sr. caused the reconstitution of Original Certificate of Title No. 18047.  The reconstituted OCT No. RO-4541 initially reflected the shares of the original co-owners in Lot 162.  However, title was transferred later to Jose Regalado, Sr. who subdivided the entire property into smaller lots, each covered by a respective title in his name. One of these small lots is Lot No. 162-C-6 with an area of 11,732 square meters which was registered on February 24, 1977 under TCT No. 14566.

In 1987, petitioners Manuel and Salvacion del Campo brought this complaint for “repartition, resurvey and reconveyance” against the heirs of the now deceased Jose Regalado, Sr. Petitioners claimed that they owned an area of 1,544 square meters located within Lot 162-C-6 which was erroneously included in TCT No. 14566 in the name of Regalado. Petitioners alleged that they occupied the disputed area as residential dwelling ever since they purchased the property from the Distajos way back in 1951.  They also declared the land for taxation purposes and paid the corresponding taxes.

On April 1, 1987, summons were served on Regalado’s widow, Josefina Buenvenida, and two of her children, Rosemarie and Antonio. Josefina and Rosemarie were declared in default on May 10, 1989 because only Antonio filed an answer to the complaint.

During trial, petitioners presented the Deed of Absolute Sale [4] executed between Soledad Daynolo and Salome Bornales as well as the Deed of Mortgage [5] and Deed of Discharge[6] signed by Jose Regalado, Sr. The Deed of Absolute Sale[7] showing the purchase by the Del Campos of the property from the Distajos was likewise given in evidence.

Despite the filing of an answer, Antonio failed to present any evidence to refute the claim of petitioners.  Thus, after considering Antonio to have waived his opportunity to present evidence, the trial court deemed the case submitted for decision.

On November 20, 1990, the trial court rendered judgment dismissing the complaint.   It held that while Salome could alienate her pro-indiviso share in Lot 162, she could not validly sell an undivided part thereof by metes and bounds to Soledad, from whom petitioners derived their title.  The trial court also reasoned that petitioners could not have a better right to the property even if they were in physical possession of the same and declared the property for taxation purposes, because mere possession cannot defeat the right of the Regalados who had a Torrens title over the land.

On appeal, the Court of Appeals affirmed the trial court’s judgment, with no pronouncement as to costs.[8]

Petitioners now seek relief from this Court and maintain that:

I.

THE FACT THAT THE SALE OF THE SUBJECT PORTION CONSTITUTES A SALE OF A CONCRETE OR DEFINITE PORTION OF LAND OWNED IN COMMON DOES NOT ABSOLUTELY DEPRIVE HEREIN PETITIONERS OF ANY RIGHT OR TITLE THERETO;

II.

IN ANY EVENT, HEREIN PRIVATE RESPONDENTS ARE ALL ESTOPPED FROM DENYING THE RIGHT AND TITLE OF HEREIN PETITIONERS.[9]

In resolving petitioners’ appeal, we must answer the following questions: Would the sale by a co-owner of a physical portion of an undivided property held in common be valid? Is respondent estopped from denying petitioners’ right and title over the disputed area? Under the facts and circumstances duly established by the evidence, are petitioners entitled to ‘repartition, resurvey and reconveyance’ of the property in question?

On the first issue, it seems plain to us that the trial court concluded that petitioners could not have acquired ownership of the subject land which originally formed part of Lot 162, on the ground that their alleged right springs from a void sale transaction between Salome and Soledad. The mere fact that Salome purportedly transferred a definite portion of the co-owned lot by metes and bounds to Soledad, however, does not per se render the sale a nullity. This much is evident under Article 493 [10] of the Civil Code and pertinent jurisprudence on the matter. More particularly in Lopez vs. Vda. De Cuaycong, et.al.[11] which we find relevant, the Court, speaking through Mr. Justice Bocobo, held that:

…The fact that the agreement in question purported to sell a concrete portion of the hacienda does not render the sale void, for it is a well-established principle that the binding force of a contract must be recognized as far as it is legally possible to do so. “Quando res non valet ut ago, valeat quantum valere potest.” (When a thing is of no force as I do it, it shall have as much force as it can have.)[12]

Applying this principle to the instant case, there can be no doubt that the transaction entered into by Salome and Soledad could be legally recognized in its entirety since the object of the sale did not even exceed the ideal shares held by the former in the co-ownership. As a matter of fact, the deed of sale executed between the parties expressly stipulated that the portion of Lot 162 sold to Soledad would be taken from Salome’s 4/16 undivided interest in said lot, which the latter could validly transfer in whole or in part even without the consent of the other co-owners. Salome’s right to sell part of her undivided interest in the co-owned property is absolute in accordance with the well-settled doctrine that a co-owner has full ownership of his pro-indiviso share and has the right to alienate, assign or mortgage it, and substitute another person in its enjoyment[13] Since Salome’s clear intention was to sell merely part of her

aliquot share in Lot 162, in our view no valid objection can be made against it and the sale can be given effect to the full extent.

We are not unaware of the principle that a co-owner cannot rightfully dispose of a particular portion of a co-owned property prior to partition among all the co-owners.   However, this should not signify that the vendee does not acquire anything at all in case a physically segregated area of the co-owned lot is in fact sold to him.  Since the co-owner/vendor’s undivided interest could properly be the object of the contract of sale between the parties, what the vendee obtains by virtue of such a sale are the same rights as the vendor had as co-owner, in an ideal share equivalent to the consideration given under their transaction. In other words, the vendee steps into the shoes of the vendor as co-owner and acquires a proportionate abstract share in the property held in common.

Resultantly, Soledad became a co-owner of Lot 162 as of the year 1940 when the sale was made in her favor.  It follows that Salome, Consorcia and Alfredo could not have sold the entire Lot 162 to Jose Regalado, Sr. on April 14, 1948 because at that time, the ideal shares held by the three co-owners/vendors were equivalent to only 10/16 of the undivided property less the aliquot share previously sold by Salome to Soledad.  Based on the principle that “no one can give what he does not have,” [14] Salome, Consorcia and Alfredo could not legally sell the shares pertaining to Soledad since a co-owner cannot alienate more than his share in the co-ownership. We have ruled many times that even if a co-owner sells the whole property as his, the sale will affect only his own share but not those of the other co-owners who did not consent to the sale. Since a co-owner is entitled to sell his undivided share, a sale of the entire property by one co-owner will only transfer the rights of said co-owner to the buyer, thereby making the buyer a co-owner of the property.[15]

In this case, Regalado merely became a new co-owner of Lot 162 to the extent of the shares which Salome, Consorcia and Alfredo could validly convey. Soledad retained her rights as co-owner and could validly transfer her share to petitioners in 1951. The logical effect of the second disposition is to substitute petitioners in the rights of Soledad as co-owner of the land. Needless to say, these rights are preserved notwithstanding the issuance of TCT No. 14566 in Regalado’s name in 1977.

Be that as it may, we find that the area subject matter of this petition had already been effectively segregated from the ‘mother lot’ even before title was issued in favor of Regalado. It must be noted that 26 years had lapsed from the time petitioners bought and took possession of the property in 1951 until Regalado procured the issuance of TCT No. 14566. Additionally, the intervening years between the date of petitioners’ purchase of the property and 1987 when petitioners filed the instant complaint, comprise all of 36 years. However, at no instance during this time did respondents or Regalado, for that matter, question petitioners’ right over the land in dispute. In the case of Vda. de Cabrera vs. Court of Appeals,[16]  we had occasion to hold that where the transferees of an undivided portion of the land allowed a co-owner of the property to occupy a definite portion thereof and had not disturbed the same for a period too long to be ignored, the possessor is in a better condition or right than said transferees. (Potior est condition possidentis). Such undisturbed possession had the effect of a partial partition of the co-owned property which entitles the possessor to the definite portion which he occupies. Conformably, petitioners are entitled to the disputed land, having enjoyed uninterrupted possession thereof for a total of 49 years up to the present.

The lower court’s reliance on the doctrine that mere possession cannot defeat the right of a holder of a registered Torrens title over property is misplaced, considering that petitioners were deprived of their dominical rights over the said lot through fraud and with evident bad faith on the part of Regalado. Failure and intentional omission to disclose the fact of actual physical possession by another person during registration proceedings constitutes actual fraud. Likewise, it is fraud to knowingly omit or conceal a fact, upon which benefit is obtained to the prejudice of a third person.[17] In this case, we are convinced that Regalado knew of the fact that he did not have a title to the entire lot and could not, therefore, have validly registered the same in his name alone because he was aware of petitioners’ possession of the subject portion as well as the sale between Salome and Soledad.

That Regalado had notice of the fact that the disputed portion of Lot 162 was under claim of ownership by petitioners and the latter’s predecessor is beyond question. Records show that the particular area subject of this case was mortgaged by Soledad and her husband to Jose Regalado, Sr. as early as May 1, 1947 or one year prior to the alienation of the whole lot in favor of the latter. Regalado never questioned the ownership of the lot given by Soledad as security for the P400.00 debt and he must have at

least known that Soledad bought the subject portion from Salome since he could not have reasonably accepted the lot as security for the mortgage debt if such were not the case. By accepting the said portion of Lot 162 as security for the mortgage obligation, Regalado had in fact recognized Soledad’s ownership of this definite portion of Lot 162. Regalado could not have been ignorant of the fact that the disputed portion is being claimed by Soledad and subsequently, by petitioners, since Regalado even executed a Release of Mortgage on May 4, 1951, three years after the entire property was supposedly sold to him.   It would certainly be illogical for any mortgagee to accept property as security, purchase the mortgaged property and, thereafter, claim the very same property as his own while the mortgage was still subsisting.

Consequently, respondents are estopped from asserting that they own the subject land in view of the Deed of Mortgage and Discharge of Mortgage executed between Regalado and petitioners’ predecessor-in-interest. As petitioners correctly contend, respondents are barred from making this assertion under the equitable principle of estoppel by deed, whereby a party to a deed and his privies are precluded from asserting as against the other and his privies any right or title in derogation of the deed, or from denying the truth of any material fact asserted in it.[18] A perusal of the documents evidencing the mortgage would readily reveal that Soledad, as mortgagor, had declared herself absolute owner of the piece of land now being litigated.  This declaration of fact was accepted by Regalado as mortgagee and accordingly, his heirs cannot now be permitted to deny it.

Although Regalado’s certificate of title became indefeasible after the lapse of one year from the date of the decree of registration, the attendance of fraud in its issuance created an implied trust in favor of petitioners and gave them the right to seek reconveyance of the parcel wrongfully obtained by the former.  An action for reconveyance based on an implied trust ordinarily prescribes in ten years.   But when the right of the true and real owner is recognized, expressly or implicitly such as when he remains undisturbed in his possession, the said action is imprescriptible, it being in the nature of a suit for quieting of title.[19] Having established by clear and convincing evidence that they are the legal owners of the litigated portion included in TCT No. 14566, it is only proper that reconveyance of the property be ordered in favor of petitioners. The alleged incontrovertibility of Regalado’s title cannot be successfully invoked by respondents because certificates of title merely confirm or record title already existing and cannot be used to protect a usurper from the true owner or be used as a shield for the commission of fraud.[20]

WHEREFORE, the petition is GRANTED.  The assailed decision of the Court of Appeals in CA-G.R. CV No. 30438 is REVERSED and SETASIDE. The parties are directed to cause a SURVEY for exact determination of their respective portions in Lot 162-C-6.  Transfer Certificate of Title No. 14566 is declared CANCELLED and the Register of Deeds of Capiz is ordered to ISSUE a new title in accordance with said survey, upon finality of this decision.

Costs against respondents.

SO ORDERED.

HOMEOWNERS SAVINGS & LOAN BANK, petitioner, vs. MIGUELA C. DAILO, respondent.

D E C I S I O N

TINGA, J.:

This is a petition for review on certiorari under Rule 45 of the Revised Rules of Court, assailing the Decision[1] of the Court of Appeals in CA-G.R. CV No. 59986 rendered on June 3, 2002, which affirmed with modification the October 18, 1997 Decision[2] of the Regional Trial Court, Branch 29, San Pablo City, Laguna in Civil Case No. SP-4748 (97).

The following factual antecedents are undisputed.

Respondent Miguela C. Dailo and Marcelino Dailo, Jr. were married on August 8, 1967. During their marriage, the spouses purchased a house and lot situated at Barangay San Francisco, San Pablo City from a certain Sandra Dalida. The subject property was declared for tax assessment purposes under

Assessment of Real Property No. 94-051-2802. The Deed of Absolute Sale, however, was executed only in favor of the late Marcelino Dailo, Jr. as vendee thereof to the exclusion of his wife.[3]

On December 1, 1993, Marcelino Dailo, Jr. executed a Special Power of Attorney (SPA) in favor of one Lilibeth Gesmundo, authorizing the latter to obtain a loan from petitioner Homeowners Savings and Loan Bank to be secured by the spouses Dailo’s house and lot in San Pablo City. Pursuant to the SPA, Gesmundo obtained a loan in the amount of P300,000.00 from petitioner. As security therefor, Gesmundo executed on the same day a Real Estate Mortgage constituted on the subject property in favor of petitioner. The abovementioned transactions, including the execution of the SPA in favor of Gesmundo, took place without the knowledge and consent of respondent.[4]

Upon maturity, the loan remained outstanding. As a result, petitioner instituted extrajudicial foreclosure proceedings on the mortgaged property. After the extrajudicial sale thereof, a Certificate of Sale was issued in favor of petitioner as the highest bidder. After the lapse of one year without the property being redeemed, petitioner, through its vice-president, consolidated the ownership thereof by executing on June 6, 1996 an Affidavit of Consolidation of Ownership and a Deed of Absolute Sale.[5]

In the meantime, Marcelino Dailo, Jr. died on December 20, 1995. In one of her visits to the subject property, respondent learned that petitioner had already employed a certain Roldan Brion to clean its premises and that her car, a Ford sedan, was razed because Brion allowed a boy to play with fire within the premises.

Claiming that she had no knowledge of the mortgage constituted on the subject property, which was conjugal in nature, respondent instituted with the Regional Trial Court, Branch 29, San Pablo City, Civil Case No. SP-2222 (97) for Nullity of Real Estate Mortgage and Certificate of Sale, Affidavit of Consolidation of Ownership, Deed of Sale, Reconveyance with Prayer for Preliminary Injunction and Damages against petitioner. In the latter’s Answer with Counterclaim, petitioner prayed for the dismissal of the complaint on the ground that the property in question was the exclusive property of the late Marcelino Dailo, Jr.

After trial on the merits, the trial court rendered a Decision on October 18, 1997. The dispositive portion thereof reads as follows:

WHEREFORE, the plaintiff having proved by the preponderance of evidence the allegations of the Complaint, the Court finds for the plaintiff and hereby orders:ON THE FIRST CAUSE OF ACTION:1. The declaration of the following documents as null and void:

(a)    The Deed of Real Estate Mortgage dated December 1, 1993 executed before Notary Public Romulo Urrea and his notarial register entered as Doc. No. 212; Page No. 44, Book No. XXI, Series of 1993.

(b)    The Certificate of Sale executed by Notary Public Reynaldo Alcantara on April 20, 1995.

(c)    The Affidavit of Consolidation of Ownership executed by the defendant  (c)    The Affidavit of Consolidation of Ownership executed by the defendant over the

residential lot located at Brgy. San Francisco, San Pablo City, covered by ARP No. 95-091-1236 entered as Doc. No. 406; Page No. 83, Book No. III, Series of 1996 of Notary Public Octavio M. Zayas.

(d)    The assessment of real property No. 95-051-1236.2. The defendant is ordered to reconvey the property subject of this complaint to the plaintiff.ON THE SECOND CAUSE OF ACTION

1. The defendant to pay the plaintiff the sum of P40,000.00 representing the value of the car which was burned.

ON BOTH CAUSES OF ACTION1. The defendant to pay the plaintiff the sum of P25,000.00 as attorney’s fees;

2. The defendant to pay plaintiff P25,000.00 as moral damages;3. The defendant to pay the plaintiff the sum of P10,000.00 as exemplary damages;

4. To pay the cost of the suit.The counterclaim is dismissed.SO ORDERED.[6]

Upon elevation of the case to the Court of Appeals, the appellate court affirmed the trial court’s finding that the subject property was conjugal in nature, in the absence of clear and convincing evidence to rebut the presumption that the subject property acquired during the marriage of spouses Dailo belongs to their conjugal partnership.[7] The appellate court declared as void the mortgage on the subject property because it was constituted without the knowledge and consent of respondent, in accordance with Article 124 of the Family Code. Thus, it upheld the trial court’s order to reconvey the subject property to respondent.[8] With respect to the damage to respondent’s car, the appellate court found petitioner to be liable therefor because it is responsible for the consequences of the acts or omissions of the person it hired to accomplish the assigned task.[9] All told, the appellate court affirmed the trial court’s Decision, but deleted the award for damages and attorney’s fees for lack of basis.[10]

Hence, this petition, raising the following issues for this Court’s consideration:

1. WHETHER OR NOT THE MORTGAGE CONSTITUTED BY THE LATE MARCELINO DAILO, JR. ON THE SUBJECT PROPERTY AS CO-OWNER THEREOF IS VALID AS TO HIS UNDIVIDED SHARE.2. WHETHER OR NOT THE CONJUGAL PARTNERSHIP IS LIABLE FOR THE PAYMENT OF THE LOAN OBTAINED BY THE LATE MARCELINO DAILO, JR. THE SAME HAVING REDOUNDED TO THE BENEFIT OF THE FAMILY.[11]

First, petitioner takes issue with the legal provision applicable to the factual milieu of this case. It contends that Article 124 of the Family Code should be construed in relation to Article 493 of the Civil Code, which states:

ART. 493. Each co-owner shall have the full ownership of his part and of the fruits and benefits pertaining thereto, and he may therefore alienate, assign or mortgage it, and even substitute another person in its enjoyment, except when personal rights are involved. But the effect of the alienation or the mortgage, with respect to the co-owners, shall be limited to the portion which may be allotted to him in the division upon the termination of the co-ownership.

Article 124 of the Family Code provides in part:

ART. 124. The administration and enjoyment of the conjugal partnership property shall belong to both spouses jointly. . . .In the event that one spouse is incapacitated or otherwise unable to participate in the administration of the conjugal properties, the other spouse may assume sole powers of administration. These powers 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 the absence of such authority or consent, the disposition or encumbrance shall be void. . . .

Petitioner argues that although Article 124 of the Family Code requires the consent of the other spouse to the mortgage of conjugal properties, the framers of the law could not have intended to curtail the right of a spouse from exercising full ownership over the portion of the conjugal property pertaining to him under the concept of co-ownership.[12] Thus, petitioner would have this Court uphold the validity of the mortgage to the extent of the late Marcelino Dailo, Jr.’s share in the conjugal partnership.

In Guiang v. Court of Appeals,[13] it was held that the sale of a conjugal property requires the consent of both the husband and wife.[14] In applying Article 124 of the Family Code, this Court declared that the absence of the consent of one renders the entire sale null and void, including the portion of the conjugal property pertaining to the husband who contracted the sale. The same principle in Guiangsquarely applies to the instant case. As shall be discussed next, there is no legal basis to construe Article 493 of the Civil Code as an exception to Article 124 of the Family Code.

Respondent and the late Marcelino Dailo, Jr. were married on August 8, 1967. In the absence of a marriage settlement, the system of relative community or conjugal partnership of gains governed the property relations between respondent and her late husband. [15] With the effectivity of the Family Code on August 3, 1988, Chapter 4 on Conjugal Partnership of Gains in the Family Code was made applicable to conjugal partnership of gains already established before its effectivity unless vested rights have already been acquired under the Civil Code or other laws.[16]

The rules on co-ownership do not even apply to the property relations of respondent and the late Marcelino Dailo, Jr. even in a suppletory manner. The regime of conjugal partnership of gains is a special type of partnership, where the husband and wife place in a common fund the proceeds, products, fruits and income from their separate properties and those acquired by either or both spouses through their efforts or by chance.[17] Unlike the absolute community of property wherein the rules on co-ownership apply in a suppletory manner,[18] the conjugal partnership shall be governed by the rules on contract of partnership in all that is not in conflict with what is expressly determined in the chapter (on conjugal partnership of gains) or by the spouses in their marriage settlements.[19] Thus, the property relations of respondent and her late husband shall be governed, foremost, by Chapter 4 on Conjugal Partnership of Gains of the Family Code and, suppletorily, by the rules on partnership under the Civil Code. In case of conflict, the former prevails because the Civil Code provisions on partnership apply only when the Family Code is silent on the matter.

The basic and established fact is that during his lifetime, without the knowledge and consent of his wife, Marcelino Dailo, Jr. constituted a real estate mortgage on the subject property, which formed part of their conjugal partnership. By express provision of Article 124 of the Family Code, in the absence of (court) authority or written consent of the other spouse, any disposition or encumbrance of the conjugal property shall be void.

The aforequoted provision does not qualify with respect to the share of the spouse who makes the disposition or encumbrance in the same manner that the rule on co-ownership under Article 493 of the Civil Code does. Where the law does not distinguish, courts should not distinguish. [20] Thus, both the trial court and the appellate court are correct in declaring the nullity of the real estate mortgage on the subject property for lack of respondent’s consent.

Second, petitioner imposes the liability for the payment of the principal obligation obtained by the late Marcelino Dailo, Jr. on the conjugal partnership to the extent that it redounded to the benefit of the family.[21]

Under Article 121 of the Family Code, “[T]he conjugal partnership shall be liable for: . . .   (3) Debts and obligations contracted by either spouse without the consent of the other to the extent that the family may have been benefited; . . . .” For the subject property to be held liable, the obligation contracted by the late Marcelino Dailo, Jr. must have redounded to the benefit of the conjugal partnership. There must be the requisite showing then of some advantage which clearly accrued to the welfare of the spouses. Certainly, to make a conjugal partnership respond for a liability that should appertain to the husband alone is to defeat and frustrate the avowed objective of the new Civil Code to show the utmost concern for the solidarity and well-being of the family as a unit.[22]

The burden of proof that the debt was contracted for the benefit of the conjugal partnership of gains lies with the creditor-party litigant claiming as such.[23] Ei incumbit probatio qui dicit, non qui negat (he who asserts, not he who denies, must prove). [24] Petitioner’s sweeping conclusion that the loan obtained by the late Marcelino Dailo, Jr. to finance the construction of housing units without a doubt redounded to the benefit of his family, without adducing adequate proof, does not persuade this Court. Other than petitioner’s bare allegation, there is nothing from the records of the case to compel a finding that, indeed, the loan obtained by the late Marcelino Dailo, Jr. redounded to the benefit of the family. Consequently, the conjugal partnership cannot be held liable for the payment of the principal obligation.

In addition, a perusal of the records of the case reveals that during the trial, petitioner vigorously asserted that the subject property was the exclusive property of the late Marcelino Dailo, Jr. Nowhere in the answer filed with the trial court was it alleged that the proceeds of the loan redounded to the benefit of the family. Even on appeal, petitioner never claimed that the family benefited from the proceeds of the loan. When a party adopts a certain theory in the court below, he will not be permitted to change his theory on appeal, for to permit him to do so would not only be unfair to the other party but it would also be offensive to the basic rules of fair play, justice and due process. [25] A party may change his legal theory on appeal only when the factual bases thereof would not require presentation of any further evidence by the adverse party in order to enable it to properly meet the issue raised in the new theory.[26]

WHEREFORE, the petition is DENIED. Costs against petitioner.

SO ORDERED.

RUSTICO ADILLE, petitioner, vs.THE HONORABLE COURT OF APPEALS, EMETERIA ASEJO, TEODORICA ASEJO, DOMINGO ASEJO, JOSEFA ASEJO and SANTIAGO ASEJO, respondents.

 

SARMIENTO, J.:

In issue herein are property and property rights, a familiar subject of controversy and a wellspring of enormous conflict that has led not only to protracted legal entanglements but to even more bitter consequences, like strained relationships and even the forfeiture of lives. It is a question that likewise reflects a tragic commentary on prevailing social and cultural values and institutions, where, as one observer notes, wealth and its accumulation are the basis of self-fulfillment and where property is held as sacred as life itself. "It is in the defense of his property," says this modern thinker, that one "will mobilize his deepest protective devices, and anybody that threatens his possessions will arouse his most passionate enmity." 1

The task of this Court, however, is not to judge the wisdom of values; the burden of reconstructing the social order is shouldered by the political leadership-and the people themselves.

The parties have come to this Court for relief and accordingly, our responsibility is to give them that relief pursuant to the decree of law.

The antecedent facts are quoted from the decision 2 appealed from:

xxx xxx xxx

... [T]he land in question Lot 14694 of Cadastral Survey of Albay located in Legaspi City with an area of some 11,325 sq. m. originally belonged to one Felisa Alzul as her own private property; she married twice in her lifetime; the first, with one Bernabe Adille, with whom she had as an only child, herein defendant Rustico Adille; in her second marriage with one Procopio Asejo, her children were herein plaintiffs, — now, sometime in 1939, said Felisa sold the property in pacto de retro to certain 3rd persons, period of repurchase being 3 years, but she died in 1942 without being able to redeem and after her death, but during the period of redemption, herein defendant repurchased, by himself alone, and after that, he executed a deed of extra-judicial partition representing himself to be the only heir and child of his mother Felisa with the consequence that he was able to secure title in his name alone also, so that OCT. No. 21137 in the name of his mother was transferred to his name, that was in 1955; that was why after some efforts of compromise had failed, his half-brothers and sisters, herein plaintiffs, filed present case for partition with accounting on the position that he was only a trustee on an implied trust when he redeemed,-and this is the evidence, but as it also turned out that one of plaintiffs, Emeteria Asejo was occupying a portion, defendant counterclaimed for her to vacate that, —

Well then, after hearing the evidence, trial Judge sustained defendant in his position that he was and became absolute owner, he was not a trustee, and therefore, dismissed case and also condemned plaintiff occupant, Emeteria to vacate; it is because of this that plaintiffs have come here and contend that trial court erred in:

I. ... declaring the defendant absolute owner of the property;

II. ... not ordering the partition of the property; and

III. ... ordering one of the plaintiffs who is in possession of the portion of the property to vacate the land, p. 1 Appellant's brief.

which can be reduced to simple question of whether or not on the basis of evidence and law, judgment appealed from should be maintained. 3

xxx xxx xxx

The respondent Court of appeals reversed the trial Court, 4 and ruled for the plaintiffs-appellants, the private respondents herein. The petitioner now appeals, by way of certiorari, from the Court's decision.

We required the private respondents to file a comment and thereafter, having given due course to the petition, directed the parties to file their briefs. Only the petitioner, however, filed a brief, and the private respondents having failed to file one, we declared the case submitted for decision.

The petition raises a purely legal issue: May a co-owner acquire exclusive ownership over the property held in common?

Essentially, it is the petitioner's contention that the property subject of dispute devolved upon him upon the failure of his co-heirs to join him in its redemption within the period required by law. He relies on the provisions of Article 1515 of the old Civil Article 1613 of the present Code, giving the vendee a retro the right to demand redemption of the entire property.

There is no merit in this petition.

The right of repurchase may be exercised by a co-owner with aspect to his share alone. 5 While the records show that the petitioner redeemed the property in its entirety, shouldering the expenses therefor, that did not make him the owner of all of it. In other words, it did not put to end the existing state of co-ownership.

Necessary expenses may be incurred by one co-owner, subject to his right to collect reimbursement from the remaining co-owners. 6 There is no doubt that redemption of property entails a necessary expense. Under the Civil Code:

ART. 488. Each co-owner shall have a right to compel the other co-owners to contribute to the expenses of preservation of the thing or right owned in common and to the taxes. Any one of the latter may exempt himself from this obligation by renouncing so much of his undivided interest as may be equivalent to his share of the expenses and taxes. No such waiver shall be made if it is prejudicial to the co-ownership.

The result is that the property remains to be in a condition of co-ownership. While a vendee a retro, under Article 1613 of the Code, "may not be compelled to consent to a partial redemption," the redemption by one co-heir or co-owner of the property in its totality does not vest in him ownership over it. Failure on the part of all the co-owners to redeem it entitles the vendee a retro to retain the property and consolidate title thereto in his name. 7But the provision does not give to the redeeming co-owner the right to the entire property. It does not provide for a mode of terminating a co-ownership.

Neither does the fact that the petitioner had succeeded in securing title over the parcel in his name terminate the existing co-ownership. While his half-brothers and sisters are, as we said, liable to him for

reimbursement as and for their shares in redemption expenses, he cannot claim exclusive right to the property owned in common. Registration of property is not a means of acquiring ownership. It operates as a mere notice of existing title, that is, if there is one.

The petitioner must then be said to be a trustee of the property on behalf of the private respondents. The Civil Code states:

ART. 1456. If property is acquired through mistake or fraud, the person obtaining it is, by force of law, considered a trustee of an implied trust for the benefit of the person from whom the property comes.

We agree with the respondent Court of Appeals that fraud attended the registration of the property. The petitioner's pretension that he was the sole heir to the land in the affidavit of extrajudicial settlement he executed preliminary to the registration thereof betrays a clear effort on his part to defraud his brothers and sisters and to exercise sole dominion over the property. The aforequoted provision therefore applies.

It is the view of the respondent Court that the petitioner, in taking over the property, did so either on behalf of his co-heirs, in which event, he had constituted himself a negotiorum gestor under Article 2144 of the Civil Code, or for his exclusive benefit, in which case, he is guilty of fraud, and must act as trustee, the private respondents being the beneficiaries, under the Article 1456. The evidence, of course, points to the second alternative the petitioner having asserted claims of exclusive ownership over the property and having acted in fraud of his co-heirs. He cannot therefore be said to have assume the mere management of the property abandoned by his co-heirs, the situation Article 2144 of the Code contemplates. In any case, as the respondent Court itself affirms, the result would be the same whether it is one or the other. The petitioner would remain liable to the Private respondents, his co-heirs.

This Court is not unaware of the well-established principle that prescription bars any demand on property (owned in common) held by another (co-owner) following the required number of years. In that event, the party in possession acquires title to the property and the state of co-ownership is ended . 8 In the case at bar, the property was registered in 1955 by the petitioner, solely in his name, while the claim of the private respondents was presented in 1974. Has prescription then, set in?

We hold in the negative. Prescription, as a mode of terminating a relation of co-ownership, must have been preceded by repudiation (of the co-ownership). The act of repudiation, in turn is subject to certain conditions: (1) a co-owner repudiates the co-ownership; (2) such an act of repudiation is clearly made known to the other co-owners; (3) the evidence thereon is clear and conclusive, and (4) he has been in possession through open, continuous, exclusive, and notorious possession of the property for the period required by law. 9

The instant case shows that the petitioner had not complied with these requisites. We are not convinced that he had repudiated the co-ownership; on the contrary, he had deliberately kept the private respondents in the dark by feigning sole heirship over the estate under dispute. He cannot therefore be said to have "made known" his efforts to deny the co-ownership. Moreover, one of the private respondents, Emeteria Asejo, is occupying a portion of the land up to the present, yet, the petitioner has not taken pains to eject her therefrom. As a matter of fact, he sought to recover possession of that portion Emeteria is occupying only as a counterclaim, and only after the private respondents had first sought judicial relief.

It is true that registration under the Torrens system is constructive notice of title, 10 but it has likewise been our holding that the Torrens title does not furnish a shield for fraud. 11 It is therefore no argument to say that the act of registration is equivalent to notice of repudiation, assuming there was one, notwithstanding the long-standing rule that registration operates as a universal notice of title.

For the same reason, we cannot dismiss the private respondents' claims commenced in 1974 over the estate registered in 1955. While actions to enforce a constructive trust prescribes in ten years, 12 reckoned

from the date of the registration of the property, 13 we, as we said, are not prepared to count the period from such a date in this case. We note the petitioner's sub rosa efforts to get hold of the property exclusively for himself beginning with his fraudulent misrepresentation in his unilateral affidavit of extrajudicial settlement that he is "the only heir and child of his mother Feliza with the consequence that he was able to secure title in his name also." 14 Accordingly, we hold that the right of the private respondents commenced from the time they actually discovered the petitioner's act of defraudation. 15 According to the respondent Court of Appeals, they "came to know [of it] apparently only during the progress of the litigation." 16 Hence, prescription is not a bar.

Moreover, and as a rule, prescription is an affirmative defense that must be pleaded either in a motion to dismiss or in the answer otherwise it is deemed waived, 17 and here, the petitioner never raised that defense. 18 There are recognized exceptions to this rule, but the petitioner has not shown why they apply.

WHEREFORE, there being no reversible error committed by the respondent Court of Appeals, the petition is DENIED. The Decision sought to be reviewed is hereby AFFIRMED in toto. No pronouncement as to costs.

SO ORDERED,

G.R. No. 79899 April 24, 1989

D. ANNIE TAN, petitioner, vs.COURT OF APPEALS, CHINA BANKING CORPORATION, GEORGE LAUREL TAN, TEODORA TAN ONG, ROSA TAN, ROSITA TAN, and MAURO UMALI TAN, respondents.

Tabaquero, Albano & Evangelista for petitioner.

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

 

GUTIERREZ, JR., J.:

Tan Tiong Tick, married to Tan Ong Hun, was the registered owner of a 178 square meter parcel of land and its improvements located at Lot No. 5, Block No. 2021 of the Cadastral Survey of Manila, Carvajal Street, Binondo, Manila.

Mr. and Mrs. Tan had six children - respondents George Laurel Tan, Teodora Tan Ong, Rosa Tan, Rosita Tan, Mauro Umali Tan, and the petitioner, D. Annie Tan.

On February 6, 1963, in order to secure payment of various obligations with respondent China Banking Corporation or China Bank for short, Mr. and Mrs. Tan Tiong Tick mortgaged the disputed property to the bank. Tan Tiong Tick died on December 22, 1969 without having paid his obligations.

On June 27, 1972, China Bank foreclosed the mortgage and purchased the property at public auction as the highest bidder for the sum of P186,100.00.

On August 31, 1972, the widow and children of Tan Tiong Tick filed a complaint against China Bank with the Court of First Instance of Manila praying for the nullity of the real estate mortgage executed by

the spouses Tan and the foreclosure sale conducted by the Sheriff. They also asked that the redemption period be suspended.

The one year period for redemption expired on July 6, 1973 without the Tan heirs having exercised the right to redeem the property. The widow Tan Ong Hun having died, only the children were left to redeem the lot and building. China Bank consolidated its ownership over the land and improvements and a new title, Transfer Certificate Title No. 112924 was issued in the name of the bank on August 16, 1973.

About two weeks earlier, however, the heirs of Tan and China Bank agreed to amicably settle the action for nullity of mortgage before the Court of First Instance of Manila. The parties filed a joint motion to dismiss.

The verbal agreement regarding the disposition of the property was confirmed in a letter of China Bank signed by four of the children and one daughter-in-law on August 3, 1973. The heirs were given the right to repurchase the property for P180,000.00 provided it was done on or before August 31,1974. The agreement reads in part:

xxx xxx xxx

It is understood, that should you fail to pay us in full the aforesaid sum of P180,000.00 on or before August 31, 1974, your right to repurchase the property shall terminate and we shall be free to dispose of the property to any other party. (p. 81, Folder of Exhibits; Exhibit 2, CBC)

There are allegations that some of the heirs tried to buy the property in the ensuing one year period but for one reason or another, were unable to do so.

Finally, on August 30, 1974, or one day before the end of the period to buy back, petitioner D. Annie Tan went to the office of Mr. Dee K. Chiong of China Bank and tendered her China Bank Manager's Check for P180,000.00 as payment. Upon the insistence of the bank official, the deed of sale returning the property to the heirs was executed in favor, not of D. Annie Tan who alone paid for the property but of all the six heirs of Tan Tiong Tick who would, therefore, share and share alike.

This led to the filing of the action by D. Annie Tan against her brothers and sisters and the China Banking Corporation, now respondents in this petition. The petitioner prayed the trial court to order the respondents-(1) to reconvey the disputed property to her and (2) to pay actual damages in the amount of P300,000.00, moral damages in the amount of P100,000.00, exemplary damages in the amount of P50,000.00, and attorney's fees in the amount of P10,000.00.

On September 1, 1980, the Court of First Instance of Manila rendered a decision, the dispositive portion of which reads:

ACCORDINGLY, judgment is hereby rendered as follows:

(1) Dismissing the complaint as well as defendants' counter-claim;

(2) Ordering each of the defendants, namely George Laurel Tan, Teodora Tan Ong, Rosa Tan and Rosita Tan to reimburse the plaintiff the sum of P30,000.00 plus 12% interest from August 20, 1974 until the whole amount is fully paid;

(3) Ordering the defendant Mauro Umali Tan who had been ordered in default to execute the deed of sale of his rights and interests over the property covered in Transfer Certificate of Title No. 64806 in favor of the plaintiff in accordance with his instrument of waiver dated June 25, 1974, and

(4) Without pronouncement as to costs. (Annex B, Rollo, pp. 43-44)

On October 17, 1986, the Court of Appeals affirmed the decision of the trial court. On September 7, 1987, a motion for reconsideration was denied. Hence this petition.

The petitioner gives the following grounds why her petition should be given due course:

1. RESPONDENT COURT OF APPEALS GRAVELY ERRED IN AFFIRMING THE DECISION OF THE TRIAL COURT ORDERING REIMBURSEMENT TO THE PETITIONER INSPITE OF THE FACT THAT THE LEGAL BASIS FOR THE REIMBURSEMENT, WHICH WAS NOT CLEARLY EXPLAINED IN THE DECISION, MAY HAVE BEEN THE ALLEGED EXISTENCE OF (1) A CO-OWNERSHIP AMONG THE HEIRS, AND (2) CREDITOR-DEBTOR RELATIONSHIP BETWEEN THE HEIRS AND THE BANK, WHICH HAVE NOT BEEN FULLY ESTABLISHED BY EVIDENCE.

2. ASSUMING, WITHOUT ADMITTING, THE EXISTENCE AMONG THE HEIRS OF A CO-OWNERSHIP AND/OR A CREDITOR/ DEBTOR RELATIONSHIP BETWEEN THE RESPONDENT BANK AND THE HEIRS, RESPONDENT COURT GRAVELY ERRED IN NOT HOLDING THAT THE CO-HEIRS OF PETITIONER, THE PRIVATE RESPONDENTS HEREIN, HAVE IMPLIEDLY WAIVED THEIR RIGHT TO BUY BACK THE PROPERTY BY THEIR FAILURE TO RAISE THE MONEY FOR THEIR RESPECTIVE SHARES UP TO THE LAST DAY GIVEN THEM BY THE RESPONDENT BANK ON AUGUST 31, 1974, THUS WHEN PETITIONER BOUGHT THE PROPERTY BY HER EXCLUSIVE FUNDS, IT BENEFITED HER ALONE AND NOT HER CO-HEIRS.

3. RESPONDENT COURT OF APPEALS, GRAVELY ERRED IN NOT HOLDING THAT THE LETTER-AGREEMENT DATED AUGUST 3, 1973, FOR WHICH THE RIGHTS OF THE PETITIONER AND HER CO-HEIRS TO BUY BACK THE FORECLOSED PROPERTY AROSE, IS ACTUALLY NOT A RIGHT TO REPURCHASE BUT IS AN OPTION TO BUY BACK THE PROPERTY WHICH MAY BE EXERCISED BY THE HEIRS SINGLY OR COLLECTIVELY. (Rollo, pp. 21-22)

The decision of the trial court, affirmed by the Court of Appeals, is based on the principle that the heirs of Mr. and Mrs. Tan Tiong Tick being co- owners of the foreclosed property, a repurchase or reconveyance effected by only one of those heirs redounds to the co-ownership. This explains why the courts below ordered four of the heirs - George Laurel Tan, Teodora Tan Ong, Rosa Tan and Rosita Tan - to reimburse D. Annie Tan the sum of P30,000.00 each plus 12% interests while the share of the fifth heir who was in default and who had waived his interest would go to the petititioner.

The petitioner contends that there was no co-ownership and no creditor/debtor relationship between her and the other children.

The petitioner states:

This controversy addresses itself to the question of whether or not the co- ownership among the heirs over a parcel of land formerly belonging to their parents had been dissolved by the foreclosure and consolidation of title by a bank after the redemption period of one (1) year had expired, such that a unilateral obligation given by the bank to the heirs to buy back the foreclosed property out of liberality is actually an option to buy given to the heirs as group of persons singly or collectively, and not strictly a right of repurchase to be exercised by the heirs as co-owners. If it is admitted that the co-ownership of the heirs over the foreclosed property of their parents had been dissolved by the consolidation of the title in the mortgagee's name, which in this case is respondent Bank and that there exists no creditor-debtor relationship between respondent Bank and the heirs, then the bank may not impose an obligation to the heirs that they should purchase back the property only as former co-owners or as solidary debtors, but as groups of persons, singly or collectively. The bank would then be imposing an onerous condition upon the heirs of going back to the dissolved co- ownership which the law frowns upon. To settle this case once and for all, herein petitioner anchors her claim on the theory that when the respondent Bank foreclosed the property and consolidated its title on August 16, 1973 and T.C.T. No. 112924 was issued in its name, the co-ownership of the heirs of the deceased parents of petitioner and private respondents over the property in question have been dissolved. In this wise, the decision of the respondent court premised on the existence of a co-ownership or in a creditor-debtor relationship, and ordering the reimbursement to petitioner of the money for the purchase of the property in question which allegedly redounded to the benefits of her co-heirs as co-owners or solidary debtors has no leg to stand on. It is this erroneous decision of respondent court based on a misapprehension of facts and contrary to settled jurisprudence that petitioner comes to this Honorable Court, for relief. (Sese v. Intermediate Appellate Court, G.R. No. 66186, July 31, 1987; Moran, Jr. v. Court of Appeals, 133 SCRA 88; Manero v. Court of Appeals, 102 SCRA 817; Carolina Industries v. CMS Brokerage, 97 SCRA 734; Sacay v. Sandiganbayan, 142 SCRA 593) (Rollo, pp. 7-9)

The first question which arises is the correctness of the assumption that there was a co-ownership among the children of Tan Tiong Tick and Tan Ong Hun when the petitioner purchased the property.

Since the lot and its improvement were mortgaged by the deceased parents, there can be no question that a co-ownership existed among the heirs during the period given by law to redeem the foreclosed property. Redemption by one during this period would have inured to the benefit of all (Adille v. Court of Appeals, G.R. No. 44546, 157 SCRA 455 [1988]; and De Guzman v. Court of Appeals, G.R. No. 47378, 148 SCRA 75 [1987]).

The records show, however, that when the petitioner purchased the disputed property on August 30, 1974, any co-ownership among the brothers and sisters no longer existed. The period to redeem had expired more than one year earlier, on July 6, 1973. The respondent China Bank consolidated its ownership and a new title was issued in the bank's name. When the heirs allowed the one year redemption period to expire without redeeming their parents' former property and permitted the consolidation of ownership and the issuance of a new title, the co-ownership was extinguished. The challenged ruling of the respondent court is, therefore, based on erroneous premises.

Under Section 63-B of Presidential Decree No. 1529, the Property Registration Decree, in case of non-redemption, the purchaser at the foreclosure sale, meaning the respondent Bank in this case, is entitled to a new certificate of title in its name after filing the necessary papers with the Register of Deeds (Spouses Teofisto and Eulalia Verceles v. Court of First Instance of Rizal, et al., G.R. No. 62219, February 28, 1989). It becomes a ministerial duty to place the buyer in possession of the property he now owns (Banco Filipino v. Intermediate Appellate Court, G.R. No. 68878,142 SCRA 44 [1986]). Ownership, therefore, passed to China Bank and there was no more co-ownership among the heirs.

The non-existence of a common inheritance of the Tan children at the time the disputed property was purchased from China Bank is moreover supported by the evidence showing that there was no more inheritance to divide. It had already been divided. Tan Tiong Tick left other properties in addition to the property disputed in this petition. The eldest son, George Laurel Tan, inherited practically all the properties consisting of several hectares of real estate in Novaliches, Metro Manila; a furnished house in Greenhills, Mandaluyong; and a cigar factory (t.s.n., November 18, 1976, p. 24). The petitioner also claims that stock certificates went to another sister, Teodora Tan Ong because she "forced" the other heirs to sign a deed of sale in her favor.

May the heirs be considered as debtors in common, substituting for their parents in liquidating the latter's obligations?

The answer is again, No.

Upon the foreclosure of the mortgaged property and its purchase by China Bank as the highest bidder, the proceeds of the auction sale were applied to the various debts of the Tan spouses. The parents' debts were paid. The obligation having been extinguished, there was no more common debt and no legal subrogation arising when one pays the debts properly accruing to several others.

Respondent China Bank contends that the letter agreement dated August 3, 1973 called for the reconveyance of the land and improvements to all the heirs "in equal undivided shares."

There is no such stipulation in the letter. There is reference to a verbal agreement to reconvey to the "heirs of your late father" but no requirement that everybody must share in the purchase or the offer would be withdrawn.

What is clear is that the bank's general manager, Mr. Dee K. Chiong tried to impose the above requirement when the one year period to buy back was about to expire. Mr. Dee rejected the offer of D. Annie Tan to buy the property for herself alone. He insisted that the money brought by the petitioner would be considered a joint fund of all the heirs and ordered the same annotated on the back of the check given as payment for the property.

This attitude of Mr. Dee K. Chiong is in sharp contrast to the bank's official stand embodied in a letter to the Central Bank.

Asked to comment on a letter-complaint filed by D. Annie Tan with Malacañang and forwarded to the Central Bank, the respondent bank through its Legal Officer wrote the Director, Department of Commercial and Savings Bank, Central Bank an explanation, part of which states:

To our mind, the dispute is not between the Bank and the heirs or any one of them, but among the heirs themselves, for as far as the Bank is concerned, it makes no difference whether the property is reconveyed to all the heirs or to any one of them alone as they may agree. As a matter of fact the complainant has already filed a Petition under the Cadastral Case now pending in the CFI, Manila, involving the property and all the heirs. (Copy of the Petition is hereto attached as Annex "l0").

At any rate, it is our honest conviction that the charges filed by the complainant and the interpretation of Articles 1302 and 1303 of the New Civil Code properly belong to the Courts where the complainant can always have her right, if any, vindicated, and if only to resolve the issue, we shall welcome any court action to clear the matter. (Folder of Exhibits, pp. 97- 98)

The petitioner questions the unusual interest shown by China Bank in the case when its stand should be one of neutrality. She claims that there is an orchestrated alliance between the bank and the other private respondents as shown by the fact that the bank seems to be more eager and vigorous than the other heirs to win the case. (Rollo, p. 310).

As earlier stated, there is nothing in the August 3, 1973 letter-agreement which called for either a purchase by all the heirs or no purchase at all. But could not Mr. Dee K. Chiong validly impose such a requirement at the time the tender of money to buy the property was made?

Again, the answer is in the negative.

We agree with the petitioner that her agreeing to sign an annotation at the back of the check was a case of vitiated consent. She states that her conformity was null and void because it was made under duress. The records show that up to the last hour the petitioner was pleading with Mr. Dee K. Chiong to buy the property for herself alone as the money she had raised was not in any way owned by the other heirs. Since the period was expiring, the petitioner had no choice. It was a case of either agreeing to the bank executive's requirement or losing the family property forever to strangers.

Mr. Dee could not impose a new co-ownership upon the petitioner, her brothers and sisters. Co-ownership is discouraged by law.

As held in the case of Basa v. Aguilar (G.R. No. L-30994, 117 SCRA 128, 130-131 [1982]):

Legal redemption is in the nature of a privilege created by law partly for reasons of public policy and partly for the benefit and convenience of the redemptioner, to afford him a way out of what might be a disagreeable or inconvenient association into which he has thrust. (10 Manresa, 4th Ed., 317.) It is intended to minimize co-ownership. The law grants a co-owner the exercise of the said right of redemption when the shares of the other owners are sold to "a third person." A third person, within the meaning of this Article, is anyone who is not a co-owner. (Sentencia of February 7, 1944 as cited in Tolentino, Comments on the Civil Code, Vol. V, p. 160.) (Emphasis supplied)

The records show that the annotation at the back of the P180,000.00 manager's check that the funds were contributed by all the heirs was made by a China Bank representative and that D. Annie Tan was told by Dee K Chiong that if she would not sign it, he would not accept the manager's check and she would lose her right to buy the lot within the period offered by the bank. The petitioner, at first, refused but being placed between the difficulty of agreeing to the condition or losing the property, she decided to agree. (t.s.n., September 27, 1976, pp. 24-25; t.s.n., November 18, 1976, p. 36) The petitioner was also aware that a certain Mr. Ang who operated a travel agency in the next door building was eager to buy the property at double the price stated in the letter-agreement executed more than a year earlier. (Court of Appeals Rollo, Brief for Plaintiff-Appellant, p. 77)

The petitioner further argues:

The insistence by respondent Bank that the said letter-agreement is a right to re-purchase given to all the heirs of the late Tan Tiong Tick to be exercised only collectively cannot legally stand considering the following circumstances:

a) What will happen if one of the heirs of the late Tan Tiong Tick refuses or fails to exercise his right to purchase for whatever reason? Cannot any of the other heirs, but all, raise sufficient funds for the full amount of the purchase price because the

other heirs could not let him or her borrow money to cover his or her share? Would such refusal then prejudice the other heirs?

b) Cannot two or more heirs, but not all, who have sufficient funds exercise the right of purchase?

c) Would all the heirs then who signed the letter-agreement as in the case at bar lose their right to purchase the property because of the refusal of one heir?

d) If only one of the heirs has sufficient funds to purchase the property and the others do not have, and this particular heir does not want to lend her or his money to the other heirs who have none, can the offer of the other heir to exercise the option to buy in her or his own name alone be legally refused?

e) Finally, can the buying back of the property by one heir alone be disallowed considering that she is the one who has enough or sufficient funds and that her action will prevent the property from going to third persons, like respondent Bank, for failure to pay the purchase price on the last day of the period given by respondent Bank?'

It is petitioner's submission that to follow the arguments of respondent Bank that the letter-agreement can only be exercised collectively and not singly would render the said agreement a useless piece of paper, and gravely prejudicial to the property itself.

What is more, even the respondent bank's legal officer, Atty. Arsenio Sy Santos, when asked to comment on the case of the petitioner, admitted that indeed the letter-agreement of August 3,1973 is actually an option to buy. Said legal officer gave the following observations and comments, to wit:

x x x x x x x x x

Observations and comments -

It may be interesting to note that the provisions of Articles 1302 and 1303 which read as follows:

"Art. 1302. It is presumed that there is legal subrogation:

(1) When a creditor pays another creditor who is preferred even without the debtor's knowledge;

(2) When a third person, not interested in the obligation, pays with the express or tacit approval of the debtor.

(3) When even without the knowledge of the debtor, a person interested in the fulfillment of the obligation pays, without prejudice to the effects of confusion as to the latter's share.

Art. 1303. Subrogation transfers to the person subrogated the credit with all the rights thereto appertaining, either against

the debtor or against third person, be they guarantors or possessors of mortgages, subject to stipulated in a conventional subrogations (sic)."

refer to cases where the creditor-debtor relationship exists among the parties. (Rollo, pp. 243-246)

xxx xxx xxx

There was no creditor-debtor relationship existing among the heirs and Mr. Dee had no legal authority to create one.

China Bank contends that when it told the petitioner that the property could not be reconveyed to her alone, she was likewise informed that a similar offer from some of the other co-heirs had also been politely turned down. (Exhibit 7, China Bank, Folder of Exhibits, p. 87)

The petitioner disputes this claim. She states that there was no such offer by her co-heirs because she was the only one willing to buy back the lot and the only one with the means to do so at that time. It was only on September 12, 1974 that the individual respondents offered to repurchase. By that time, D. Annie Tan had already paid for the lot and was already insisting on a conveyance of the property in her name alone.

The petitioner states:

There is, therefore, no doubt that the money used in buying back the property belongs exclusively to the petitioner. Private respondents' in action in not contributing the necessary money up to the last day of the buy back period is fatal to their cause. To paraphrase one case decided by this Honorable Court, courts cannot look with favor at parties who, by their silence, delay and inaction, knowingly induce another to spend time, effort and expense in protecting their interests over the property by paying the buy back money only to spring from ambush and claim title or interest over the property when the land and building value have become higher. (See Lola v. Court of Appeals, G.R. No. 46575, November 13, 1986). Moreover, the laws aid the vigilant, not those who slumber on their rights. (Miraflor v. Court of Appeals, G.R. Nos. 40151-52, April 8, 1986).

Definetly, the effects of a waiver militates against the private respondents. Having forfeited, abandoned and/or waived their rights, private respondents are now estopped from taking an inconsistent position. They cannot now assert that they are still CO-owners of the property with the petitioner. (Sec. 65, Rule 123, Rules of Court; Hernaez v. Hernaez, 32 Phil. 214) (See also Banco de Oro Savings & Mortgage Bank v. Equitable Banking Corporation, G.R. No. 74917, January 20, 1988, citing Saura Import and Export Co. v. Court of Appeals, 24 SCRA 974). All the elements of a valid waiver (1) the existence of a right; (2) the knowledge of the existence thereof; and (3) the intention to relinquish such right, either expressly or impliedly are present. (Director of Lands v. Abiertas, 44 O.G. 928). ... (Rollo, pp. 238-239)

The claim of the respondents Tan in their memorandum that they gave their individual contributions to the petitioner to raise the P180,000.00 is not worthy of credence. At the time of the repurchase, the petitioner was already estranged from the respondents Tan and they would not have given her any money without corresponding receipts or given her money under any circumstance, for that matter. In fact, there is no reason why the petitioner should be the one to collect the money of the heirs and bring it to China Bank. She was neither a son nor the eldest. Neither did the others feel kindly towards her. The petitioner had called for a conference on July 23, 1974 at 619 Carvajal Street, Binondo, Manila to discuss compliance

with the letter-agreement considering the fast approaching deadline. Not one showed up. (Rollo, pp. 44-45) The money was raised by D. Annie Tan through her connections with Jardine Davies because of her construction business. The decision of the respondent court confirmed the factual findings of the trial court. It declared that the respondents Tan became debtors of petitioner Tan and ordered them to reimburse the P30,000.00 each which were advanced by the petitioner. There was no pooling of resources up to August 30,1974 when at 4:00 in the afternoon, D. Annie Tan went to Mr. Dee K. Chiong with the China Bank manager's check for P180,000.00.

The equities of this case also favor the grant of the petition. D. Annie Tan went to plenty of trouble in her effort to buy back the property formerly owned by her parents. There is nothing in the records to show that, beyond making some perfunctory allegations, the respondents Tan did anything to save the property from falling into the hands of other persons. The petitioner states that she has now spent substantial sums to pay for real estate taxes and to renovate, and improve the premises. According to her she has "spent her little fortunes to preserve the patrimony left by her parents." She alone deserves to be entitled to the property, in law and equity. (Rollo, p. 317)

WHEREFORE, the petition is hereby GRANTED. The questioned decision of the Court of Appeals is REVERSED and SET ASIDE. The respondent China Banking Corporation is ordered to execute the deed of sale over the disputed property in favor of the petitioner alone.

SO ORDERED.

[G.R. No. L-59974. March 9, 1987.]

TEODORA, MARTA, JOSE, SIXTO, RICARDO, ROBERTO, PILAR, VIRGILIO, all surnamed MARIANO and AURORA EUGENIO, Petitioners, v. THE HON. JUDGE JESUS R. DE VEGA,

PRESIDING JUDGE, COURT OF FIRST INSTANCE OF BULACAN, BRANCH II, PILAR, REGINA, FELISA and DOMINADOR all surnamed PANGANIBAN, Respondents.

Ernesto T. Zshornack, Jr., for Petitioners.

Emiliano S. Samson for Private Respondents.

D E C I S I O N

PARAS, J.:

This is an appeal from the order of the then Court of First Instance of Bulacan in Civil Case No. 6200-M ** for partition and delivery of possession of certain shares in the conjugal assets. The dispositive portion of the order which herein petitioners assail states:jgc:chanrobles.com.ph

"Upon due research and study, the Court finds sustainable the position of the defendants that the settled prevailing rule at present as laid down in latest decisions of the Supreme Court is that the right or action to enforce an implied or constructive trust (which is the situation indicated in the case at bar) in one’s favor prescribes in ten (10) years. The citation of authorities made by defendants appears to be correct. (Carontes v. C.A., 76 SCRA 514; Dela Cerna v. Dela Cerna, 72 SCRA 514). In other words, the rule of imprescriptibility of actions based on constructive trust invoked by plaintiffs has been reversed and abandoned.

For the foregoing premises, this case has to be resolved for defendants-movants. Case is accordingly

dismissed. No costs."cralaw virtua1aw library

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

The records also disclose that on June 19, 1981, or 28 years, 9 months and 1 day after Urbano’s death, petitioners instituted an action with the then CFI of Bulacan for partition and delivery of possession of their corresponding shares in the conjugal estate of decedents-spouses Urbano and Roberta consisting of subject 29 parcels of unregistered land. Petitioners filed the case because since the death of Urbano, their grandfather, in 1952, private respondents (his children by the second marriage) had taken possession of the whole conjugal property and appropriated to themselves to the exclusion of petitioners the products coming from the 29 parcels of land.chanrobles virtual lawlibrary

On September 30, 1981 or around three (3) months from the filing of the civil case, respondent judge issued the questioned order. Petitioners’ motion for reconsideration of the same was denied on January 12, 1982.

Hence, this petition which petitioners filed on April 5, 1982 praying for the revocation of the questioned order and the reinstatement of this case in the trial court.

Petitioners anchor their petition on the following grounds:chanrob1es virtual 1aw library

1. The subject parcels of land being unregistered lands do not come within the applicability of the decisions invoked which involve registered lands;

2. Assuming that the ten-year prescriptive period applies even in cases of unregistered lands, the prescriptive period did not commence to run against petitioners since there is no allegation, much less evidence, that private respondents had openly and effectively repudiated the co-ownership or constructive trust over the subject property;

3. There can be no constructive notice of an adverse claim of ownership in favor of private respondents by placing the subject lands in their names in the office of the Provincial Assessor; and

4. Petitioners’ action for partition is still timely despite the lapse of almost 29 years during which private respondents had been in possession of the property.

Private respondents, on the other hand, contend that the order appealed from has already become final and no longer appealable; and, that the petition is not meritorious because of the following:chanrob1es virtual 1aw library

1. The theory of constructive trust was brought out by petitioners themselves;

2. Petitioners cannot contradict their own admissions in the pleadings;

3. Petitioners slept on their alleged rights; and

4. Contrary to petitioners’ claim, the jurisprudence cited by private respondents apply to unregistered lands.chanrobles virtual lawlibrary

The resolution of this case hinges on the focal issue of prescription.

We find the order of the trial court dismissing petitioners’ complaint on the ground of prescription under Section 40 of Public Act No. 190 to be inaccurate.

As We see it, this case is governed by the rules on co-ownership, since both parties are clearly co-owners of the disputed properties, having inherited the same from a common ancestor.

Now then, Art. 494 (last paragraph) of the Civil Code provides:red:chanrobles.com.ph

"x       x       x

"No prescription shall run in favor of a co-owner or co-heir against his co-owners or co-heirs so long as he expressly or impliedly recognizes the co-ownership."cralaw virtua1aw library

In view of their lack of a clear repudiation of the co-ownership, duly communicated to the petitioners (the other co-owners), private respondents cannot acquire the shares of the petitioners by prescription. The record in the Office of the Assessor is not the sufficient repudiation and communication contemplated by the law. Neither may the private respondents’ possession of the premises militate against petitioners’ claim. After all, co-owners are entitled to be in possession of the premises.

The existence of the co-ownership here argues against the theory of implied trust, for then a co-owner possesses co-owned property not in behalf of the other co-owners but in his own behalf.

Anent the contention that the judgment of the trial court has already become final and executory, the records reveal the contrary. The appeal was filed on time on April 5, 1982 or before April 28, 1982, the last day granted by this Court for the filing of the appeal.chanrobles law library

WHEREFORE, the assailed Order is SET ASIDE, and a new one is rendered remanding this case to the lower court for adjudication on the merits.

SO ORDERED.

SENEN   B.   AGUILAR,                                        Petitioner,   

- versus -   

VIRGILIO B. AGUILAR and ANGEL B. AGUILAR,                                    Respondents, x-----------------------------------------------x ALEJANDRO C. SANGALANG,                   Intervenor-Respondent.

G.R. No. 141613  Present:

  PANGANIBAN, J., Chairman,SANDOVAL-GUTIERREZ,CORONA,CARPIO MORALES, andGARCIA, JJ.

   Promulgated: December 16, 2005

 x---------------------------------------------------------------------------------------------x 

D E C I S I O N 

 SANDOVAL-GUTIERREZ, J.:   

          Assailed in this petition for review on certiorari are the Decision[1] and Resolution[2] of the Court of

Appeals, dated June 11, 1999 and January 11, 2000, respectively, in CA-G.R. CV No. 55750.

          The parties in this case are brothers, except Alejandro Sangalang, herein intervenor-respondent.    As

will be subsequently discussed, this is the second time that the brothers Aguilar seek the intervention of

this Court regarding the same facts and the same subject matter.    The first was in Aguilar v. Court of

Appeals, G.R. No. 76351 decided on October 29, 1993 against Senen B. Aguilar.[3]     It is time to

writ finis to this family wrangling.

          On October 28, 1993, Senen and Virgilio purchased a house and lot located in Parañaque City,

Metro Manila for the benefit of their father, Maximiano Aguilar (now deceased).   The brothers wanted

their father to enjoy his retirement in a quiet neighborhood.    On February 23, 1970, they executed a

written agreement stipulating that their shares in the house and lot would be equal; and that Senen would

live with their father on condition that he would pay the Social Security System (SSS) the remaining loan

obligation of the former owners. 

          In 1974, their father died.  Virgilio then demanded that Senen vacate the house and that the property

be sold, the proceeds to be divided between them.   Senen refused to comply with Virgilio’s demand.

          On January 12, 1979, Virgilio filed a complaint with the Court of First Instance (now Regional Trial

Court) of Rizal at Pasay City for specific performance.   Virgilio prayed that Senen be compelled to sell

the property so that the proceeds could be divided between them.  

          However, during the pre-trial, neither Senen nor his counsel appeared.   Thus, Senen was declared

as in default by the trial court and Virgilio was allowed to present his evidence ex-parte.

          On July 26, 1979, the trial court rendered its Decision, declaring the brothers co-owners of the

house and lot and are entitled to equal shares; and ordering that the property be sold, the proceeds to be

divided equally between them.    The trial court also ordered Senen to vacate the property and to pay

Virgilio rentals with interests corresponding to the period from January 1975 until he leaves the

premises.  

          On appeal, docketed as CA-G.R. CV No. 03933, the Court of Appeals reversed the trial court’s

Decision.

          Virgilio then filed with this Court a petition for review on certiorari, docketed as G.R. No. 76351.

          On October 29, 1993, this Court rendered its Decision, the dispositive portion of which reads:

         “WHEREFORE, the petition is GRANTED. The assailed Decision of the Court of Appeals dated 16 October 1986 is REVERSED and SET ASIDE. The decision of the trial court in Civil Case No. 6912-P dated 26 July 1971 is REINSTATED, with the modification that respondent Senen B. Aguilar is ordered to vacate the premises in question within ninety (90) days from receipt of this decision, and to pay petitioner Virgilio B. Aguilar, a monthly rental of P1,200.00 with interest at the legal rate from the time he received the decision of the trial court directing him to vacate until he effectively leaves the premises.

            The trial court is further directed to take immediate steps to implement this decision, conformably with Art. 498 of the Civil Code and the Rules of Court. This decision is final and executory.

            SO ORDERED.”

 

 

          On March 27, 1995, Senen filed with the Regional Trial Court, Branch 260, Parañaque City, an

action for legal redemption against Virgilio and another brother, Angel, docketed as Civil Case No. 95-

039.    In his complaint, Senen alleged that while he knows that Virgilio sold his ½ share of the property to

Angel in January 1989, however, he (Senen) was not furnished any written notice of the sale.    

Consequently, as a co-owner, he has the right to redeem the property.

          Meanwhile, on November 27, 1995, pursuant to this Court’s Decision in G.R. No. 76351, the

property was sold at public auction to Alejandro C. Sangalang, intervenor-respondent herein. Virgilio then

received his share of the proceeds as well as the rental payments due from Senen.

          By then, Virgilio had moved to California, USA.   It was only on January 25, 1997 that he was

served, through the Philippine Consulate in San Francisco, a copy of Senen’s complaint in Civil Case No.

95-039.

          On February 24, 1997, Virgilio filed a motion to dismiss the complaint for lack of cause of action

and forum shopping.

          In an Order dated June 27, 1997, the trial court dismissed Civil Case No. 05-039 on the ground of

laches, holding that Senen incurred a delay of seven (7) years before asserting his right to redeem the

property in question.

          On appeal, the Court of Appeals affirmed the assailed Order of the trial court.

          Hence, the instant petition for review on certiorari.

          The sole issue for our resolution is whether the Court of Appeals erred in holding that Senen’s

complaint for legal redemption in Civil Case No. 05-039 is barred by laches.       

          Legal redemption (retracto legal de comuneros) is a privilege created by law, partly by reason of

public policy and partly for the benefit of the redemptioner to afford him a way out of a disagreeable or

inconvenient association into which he has been thrust.[4]

With respect to redemption by co-owners, in case the share of a co-owner is sold to a third

person, the governing law is Article 1620 of the Civil Code which provides: 

         “ART. 1620. A co-owner of a thing may exercise the right of redemption in case the shares of all the other co-owners or of any of them are sold to a third person. If the price of the alienation is grossly excessive, the redemptioner shall pay only a reasonable rate.

            Should two or more co-owners desire to exercise the right of redemption, they may only do so in proportion to the share they may respectively have in the thing owned in common.”

 

 

 

The purpose behind Article 1620 is to provide a method for terminating the co-ownership and

consolidating the dominion in one sole owner.[5]

Article 1623 of the same Code also provides:

            ”ART. 1623. The right of legal pre-emption or redemption shall not be exercised except within thirty days from the notice in writing by the prospective

vendee, or by the vendor, as the case may be. The deed of sale shall not be recorded in the Registry of Property, unless accompanied by an affidavit of the vendee that he has given written notice thereof to all possible redemptioners.

            The right of redemption of co-owners excludes that of adjoining owners.”

 

 

 

          From the above provisions, the following are the requisites for the exercise of legal redemption: (1)

There must be a co-ownership; (2) one of the co-owners sold his right to a stranger;  (3) the sale was made

before the partition of the co-owned property; (4) the right of redemption must be exercised by one or

more co-owners within a period of thirty days to be counted from the time that he or they were notified in

writing by the vendee or by the co-owner vendor; and (5) the vendee must be reimbursed for the price of

the sale.

          In this case, the sale took place in January 1989.   Petitioner admits that he has actual knowledge of

the sale.   However, he only asserted his right to redeem the property in March 1995 by filing the instant

complaint.   Both the trial court and the Appellate Court ruled that this was seven (7) years late.

          Petitioner, however, now contends that there being no written notice to him of the sale by the

vendee or vendor, the thirty-day redemption period has not prescribed.

          Petitioner’s contention lacks merit.   The old rule is that a written notice of the sale by the vendor to

his co-owners is indispensable for the latter to exercise their retracto legal de comuneros.[6]    More

recently, however, we have relaxed the written notice requirement.    Thus, in Si v. Court of Appeals,[7] we

ruled that a co-owner with actual notice of the sale is not entitled to a written notice for such would be

superfluous.    The law does not demand what is unnecessary.

          Laches is the failure or neglect, for an unreasonable and unexplained length of time, to do that

which could or should have been done earlier through the exercise of due diligence. [8]   Otherwise stated,

laches is the negligence or omission to assert a right within a reasonable time warranting a presumption

that the party entitled to assert it has either abandoned or declined to assert it. [9]    Its elements are: (1)

conduct on the part of the defendant, or of one under whom he claims, giving rise to the situation for

which the complaint seeks a remedy; (2) delay in asserting the complainant’s rights, the complainant

having had knowledge or notice of the defendant’s conduct as having been afforded an opportunity to

institute a suit; (3) lack of knowledge or notice on the part of the defendant that the complainant would

assert the right in which he bases his suit; and (4) injury or prejudice to the defendant in the event, relief is

accorded to the complainant, or the suit is not held barred.[10]

          Petitioner has actual knowledge of the sale of Virgilio’s share to Angel in 1989.     As provided by

Article 1623, he has thirty days from such actual knowledge within which to exercise his right to redeem

the property.   Inexplicably, petitioner did not take any action.    He waited for seven (7) years before

filing his complaint.   Definitely, such an unexplained delay is tantamount to laches.    To be sure, to

uphold his right would unduly cause injury to respondent-intervenor, a purchaser in good faith and for

value.

          Moreover, by the time Senen filed Civil Case No. 95-039 for legal redemption, his right was no

longer available to him.    We have held that after a property has been subdivided and distributed among

the co-owners, the community has terminated and there is no reason to sustain any right of pre-emption or

redemption.[11]

          WHEREFORE, the petition is DENIED.   The Decision and Resolution of the Court of Appeals in

CA-G.R. CV No. 55750 are AFFIRMED.     Costs against petitioner.

          SO ORDERED.

EPITACIO DELIMA, PACLANO DELIMA, FIDEL DELIMA, VIRGILIO DELIMA, GALILEO DELIMA, JR., BIBIANO BACUS, OLIMPIO BACUS and PURIFICACION BACUS, petitioners, vs.HON. COURT OF APPEALS, GALILEO DELIMA (deceased), substituted by his legal heirs, namely: FLAVIANA VDA. DE DELIMA, LILY D. ARIAS, HELEN NIADAS, ANTONIO DELIMA, DIONISIO DELIMA, IRENEA DELIMA, ESTER DELIMA AND FELY DELIMA, respondents.

Gabriel J. Canete for petitioners.

Emilio Lumontad, Jr. for private respondents.

 

MEDIALDEA, J.:p

This is a petition for review on certiorari of the decision of the Court of Appeals reversing the trial court's judgment which declared as null and void the certificate of title in the name of respondents' predecessor and which ordered the partition of the disputed lot among the parties as co-owners.

The antecedent facts of the case as found both by the respondent appellate court and by the trial court are as follows:

During his lifetime, Lino Delima acquired Lot No. 7758 of the Talisay-Minglanilla Friar Lands Estate in Cebu by sale on installments from the government. Lino Delima later died in 1921 leaving as his only heirs three brothers and a sister namely: Eulalio Delima, Juanita Delima, Galileo Delima and Vicente Delima. After his death, TCT No. 2744 of the property in question was issued on August 3, 1953 in the name of the Legal Heirs of Lino Delima, deceased, represented by Galileo Delima.

On September 22, 1953, Galileo Delima, now substituted by respondents, executed an affidavit of "Extra-judicial Declaration of Heirs." Based on this affidavit, TCT No. 2744 was cancelled and TCT No. 3009 was issued on February 4,1954 in the name of Galileo Delima alone to the exclusion of the other heirs.

Galileo Delima declared the lot in his name for taxation purposes and paid the taxes thereon from 1954 to 1965.

On February 29, 1968, petitioners, who are the surviving heirs of Eulalio and Juanita Delima, filed with the Court of First Instance of Cebu (now Regional Trial Court) an action for reconveyance and/or partition of property and for the annulment of TCT No. 3009 with damages against their uncles Galileo Delima and Vicente Delima,. Vicente Delima was joined as party defendant by the petitioners for his refusal to join the latter in their action.

On January 16, 1970, the trial court rendered a decision in favor of petitioners, the dispositive portion of which states:

IN VIEW OF THE FOREGOING CONSIDERATIONS, the following are the declared owners of Lot No. 7758 of the Talisay-Minglanilla Friar Lands Estate presently covered by transfer Certificate of Title No. 3009, each sharing a pro-indiviso share of one-fourth;

1) Vicente Delima (one-fourth)

2) Heirs of Juanita Delima, namely: Bibiano Bacus, Olimpio Bacus and Purificacion Bacus (on-fourth);

3) Heirs of Eulalio Delima, namely Epitacio, Pagano, Fidel, Virgilio and Galileo Jr., all surnamed Delima (one-fourth); and

4) The Heirs of Galileo Delima, namely Flaviana Vda. de Delima, Lily D. Arias, Helen Niadas and Dionisio, Antonio, Eotu Irenea, and Fely, all surnamed Delima (one-fourth).

Transfer Certificate of Title No. 3009 is declared null and void and the Register of Deeds of Cebu is ordered to cancel the same and issue in lieu thereof another title with the above heirs as pro-indiviso owners.

After the payment of taxes paid by Galileo Delima since 1958, the heirs of Galileo Delima are ordered to turn a over to the other heirs their respective shares of the fruits of the lot in question computed at P170.00 per year up to the present time with legal (interest).

Within sixty (60) days from receipt of this decision the parties are ordered to petition the lot in question and the defendants are directed to immediately turn over possession of the shares here awarded to the respective heirs.

Defendants are condemned to pay the costs of the suit.

The counterclaim is dismissed.

SO ORDERED. (pp. 54-55, Rollo)

Not satisfied with the decision, respondents appealed to the Court of Appeals. On May 19, 1977, respondent appellate court reversed the trial court's decision and upheld the claim of Galileo Delima that all the other brothers and sister of Lino Delima, namely Eulalio, Juanita and Vicente, had already relinquished and waived their rights to the property in his favor, considering that he (Galileo Delima) alone paid the remaining balance of the purchase price of the lot and the realty taxes thereon (p. 26, Rollo).

Hence, this petition was filed with the petitioners alleging that the Court of Appeals erred:

1) In not holding that the right of a co-heir to demand partition of inheritance is imprescriptible. If it does, the defenses of prescription and laches have already been waived.

2) In disregarding the evidence of the petitioners.(p.13, Rollo)

The issue to be resolved in the instant case is whether or not petitioners' action for partition is already barred by the statutory period provided by law which shall enable Galileo Delima to perfect his claim of ownership by acquisitive prescription to the exclusion of petitioners from their shares in the disputed property. Article 494 of the Civil Code expressly provides:

Art. 494. No co-owner shall be obliged to remain in the co-ownership. Each co-owner may demand at any time the partition of the thing owned in common, insofar as his share is concerned.

Nevertheless, an agreement to keep the thing undivided for a certain period of time, not exceeding ten years, shall be valid. This term may be extended by a new agreement.

A donor or testator may prohibit partition for a period which shall not exceed twenty years.

Neither shall there be any partition when it is prohibited by law.

No prescription shall run in favor of a co-owner or co-heir against his co-owners or co-heirs so long as he expressly or impliedly recognizes the co-ownership.

As a rule, possession by a co-owner will not be presumed to be adverse to the others, but will be held to benefit all. It is understood that the co-owner or co-heir who is in possession of an inheritance pro-indiviso for himself and in representation of his co-owners or co-heirs, if, as such owner, he administers or takes care of the rest thereof with the obligation of delivering it to his co-owners or co-heirs, is under the same situation as a depository, a lessee or a trustee (Bargayo v. Camumot, 40 Phil, 857; Segura v. Segura, No. L-29320, September 19, 1988, 165 SCRA 368). Thus, an action to compel partition may be filed at any time by any of the co-owners against the actual possessor. In other words, no prescription shall run in favor of a co-owner against his co-owners or co-heirs so long as he expressly or impliedly recognizes the co-ownership (Del Blanco v. Intermediate Appellate Court, No. 72694, December 1, 1987, 156 SCRA 55).

However, from the moment one of the co-owners claims that he is the absolute and exclusive owner of the properties and denies the others any share therein, the question involved is no longer one of partition but of ownership (De Castro v. Echarri, 20 Phil. 23; Bargayo v. Camumot, supra; De los Santos v. Santa Teresa, 44 Phil. 811). In such case, the imprescriptibility of the action for partition can no longer be

invoked or applied when one of the co-owners has adversely possessed the property as exclusive owner for a period sufficient to vest ownership by prescription.

It is settled that possession by a co-owner or co-heir is that of a trustee. In order that such possession is considered adverse to the cestui que trust amounting to a repudiation of the co-ownership, the following elements must concur: 1) that the trustee has performed unequivocal acts amounting to an ouster of the cestui que trust; 2) that such positive acts of repudiation had been made known to the cestui que trust; and 3) that the evidence thereon should be clear and conclusive (Valdez v. Olorga, No. L-22571, May 25, 1973, 51 SCRA 71; Pangan v. Court of Appeals, No. L-39299, October 18, 1988, 166 SCRA 375).

We have held that when a co-owner of the property in question executed a deed of partition and on the strength thereof obtained the cancellation of the title in the name of their predecessor and the issuance of a new one wherein he appears as the new owner of the property, thereby in effect denying or repudiating the ownership of the other co-owners over their shares, the statute of limitations started to run for the purposes of the action instituted by the latter seeking a declaration of the existence of the co-ownership and of their rights thereunder (Castillo v. Court of Appeals, No. L-18046, March 31, 1964, 10 SCRA 549). Since an action for reconveyance of land based on implied or constructive trust prescribes after ten (10) years, it is from the date of the issuance of such title that the effective assertion of adverse title for purposes of the statute of limitations is counted (Jaramil v. Court of Appeals, No. L-31858, August 31, 1977, 78 SCRA 420).

Evidence shows that TCT No. 2744 in the name of the legal heirs of Lino Delima, represented by Galileo Delima, was cancelled by virtue of an affidavit executed by Galileo Delima and that on February 4, 1954, Galileo Delima obtained the issuance of a new title in Ms name numbered TCT No. 3009 to the exclusion of his co-heirs. The issuance of this new title constituted an open and clear repudiation of the trust or co-ownership, and the lapse of ten (10) years of adverse possession by Galileo Delima from February 4, 1954 was sufficient to vest title in him by prescription. As the certificate of title was notice to the whole world of his exclusive title to the land, such rejection was binding on the other heirs and started as against them the period of prescription. Hence, when petitioners filed their action for reconveyance and/or to compel partition on February 29, 1968, such action was already barred by prescription. Whatever claims the other co-heirs could have validly asserted before can no longer be invoked by them at this time.

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

SO ORDERED.

Mariategui v. CA, 205 SCRA 337FACTS: Lupo Mariategui contracted three marriages during his lifetime. He had 4 children with his first wife, Eusebia Montellano. He had 1 child with his second wife, Flaviana Montellano. And he had 3 children with his third wife, Felipa Velasco. Lupo died instestate. Upon his death, descendants from his first and second marriages executed a deed of extrajudicial partition on Lot No. 163. However, the children on Lupo’s third marriage filed with the lower court an amended complaint claiming that they were deprive on the partition of Lot No. 163 which were owned by their common father. The petitioners, children on first and second marriage, filed a counterclaim to dismiss the said complaint. Trial court denied the motion to dismiss and also the complaint by the respondents, children on third marriage. Respondents elevated the case on CA on the ground that the trial court committed an error for not finding the third marriage to be lawfully married and also in holding respondents are not legitimate children of their said parents. CA rendered a decision declaring all the children and descendants of Lupo, including the respondents, are entitled to equal shares of estate of their father. However, petitioners filed a motion for reconsideration of said decision.

ISSUE: Whether or not respondents were able to prove their succession rights over the said estate.

HELD: With respect to the legal basis of private respondents' demand for partition of the estate of Lupo Mariategui, the Court of Appeals aptly held that the private respondents are legitimate children of the deceased. Lupo Mariategui and Felipa Velasco were alleged to have been lawfully married in or about 1930. This fact is based on the declaration communicated by Lupo Mariategui to Jacinto who testified that "when his father was still living, he was able to mention to him that he and his mother were able to get married before a Justice of the Peace of Taguig, Rizal." The spouses deported themselves as husband and wife, and were known in the community to be such. Although no marriage certificate was introduced to this effect, no evidence was likewise offered to controvert these facts. Moreover, the mere fact that no record of the marriage exists does not invalidate the marriage, provided all requisites for its validity are present. Under these circumstances, a marriage may be presumed to have taken place between Lupo and Felipa.

HEIRS OF SEGUNDA MANINGDING, represented by DELFIN, GIL, EMMA, MANUEL, RACQUEL, ESTER, REMEDIOS and JESSIE, all surnamed PARAYNO, MAXIMA PARAYNO, LEONARDO PARAYNO and FELICISIMA PARAYNO, petitioners, vs. COURT OF APPEALS and ROQUE BAUZON (deceased), represented by his heirs and co-defendants Luis and Eriberta Bauzon; LUIS BAUZON, ERIBERTA BAUZON (deceased), substituted by her husband PLACIDO ZULUETA, and JOSE PARAYNO,respondents.

D E C I S I O N

BELLOSILLO, J.:

This is an action for annulment of documents, accounting and partition of two (2) parcels of land, a riceland and a sugarland, situated in Calasiao, Pangasinan.  Petitioners claim that they, together with private respondents Luis and Eriberta Bauzon, own the disputed lots in common and pro-indiviso.  Luis and Eriberta, the latter represented by her husband Placido Zulueta, aver that their father Roque Bauzon was the owner of the subject lots by virtue of a deed of donation propter nuptias.  Roque, together with Juan Maningding, Maria Maningding and Segunda Maningding were the surviving children of Ramon Bauzon y Untalan who died intestate in 1948.  According to petitioners, Roque Bauzon repudiated the co-ownership over the sugarland in 1965 and adjudicated it to himself,[1] and that in 1970 Juan and Maria Maningding renounced and quitclaimed their shares over the riceland in favor of Roque Bauzon by virtue of an Affidavit of Quitclaim and Renunciation.[2]Subsequently, Roque Bauzon transferred the riceland to his son Luis Bauzon and the sugarland to his daughter Eriberta Bauzon, both transactions being evidenced by deeds of sale.

On 31 July 1979 Segunda Maningding died.  Her heirs allegedly discovered the transfers made by Roque Bauzon in favor of his children only in 1986.  Consequently, the heirs sought the partition of the properties as well as the accounting of the produce but were unsuccessful.

On the other hand private respondents aver that the Affidavit of Quitclaim and Renunciation over the riceland was executed not only by Juan Maningding and Maria Maningding but also by Segunda Maningding.  With regard to the sugarland, Roque Bauzon denied having executed theAffidavit of Self-Adjudication presented by  petitioners.  He claimed that he acquired ownership over both the sugarland and the riceland by donation propter nuptias from his parents Ramon Bauzon and Sotera Zulueta on 21 April 1926 in consideration of his marriage to Petra Loresco.  Since the death of Ramon Bauzon in 1948, Roque had been in open, continuous, notorious, adverse and actual possession of the subject properties.

The trial court found that the parcels of land formed part of the estate of Ramon Bauzon and his wife Sotera Zulueta which, upon their death, devolved by right of succession to their children Segunda Maningding, Maria Maningding, Juan Maningding and Roque Bauzon in equal pro-indiviso shares.  The court a quo however awarded both parcels to Segunda Maningding and Roque Bauzon as co-owners in equal shares after finding that Juan Maningding and Maria Maningding had already executed an Affidavit of Quitclaim and Renunciation.  It rejected the deed of donation for failure to prove its due execution and authenticity and ruled that the same was negated by the Affidavit of Quitclaim and Renunciation of Juan Maningding and Maria Maningding in favor of Roque Bauzon and nullified the deed of sale by Roque

Bauzon in favor of Luis Bauzon as regards the riceland and to Eriberta Bauzon with respect to the sugarland.  It concluded that Roque Bauzon could not have validly conveyed both parcels as one-half (1/2) of each parcel rightfully belonged to Segunda Maningding and her heirs.

The Court of Appeals however ruled that the properties validly pertained to Roque Bauzon by virtue of the donation propter nuptias. Consequently, the transfers made by Roque Bauzon must be given effect.  However, upon motion for reconsideration, the same deed of donation was declared null and void by the appellate court for failure to comply with Art. 633 of the old Civil Code, the law then applicable, which required for the validity of the deed of donation to be in a public instrument.   Nevertheless, the same court maintained that the properties belonged to Roque Bauzon by virtue of acquisitive prescription.

We agree with the Court of Appeals.  Roque Bauzon acquired ownership over the subject properties by acquisitive prescription. Prescription, in general, is a mode of acquiring (or losing) ownership and other real rights through the lapse of time in the manner and under conditions laid down by law, namely, that the possession should be in the concept of an owner, public, peaceful, uninterrupted and adverse. [3]Acquisitive prescription is either ordinary or extraordinary.[4]

Ordinary acquisitive prescription requires possession in good faith and with just title for ten (10) years.  In extraordinary prescription ownership and other real rights over immovable property are acquired through uninterrupted adverse possession thereof for thirty (30) years, without need of title or of good faith.[5]

The disputed lots are unregistered lands, both parcels being covered only by tax declarations formerly in the name of Ramon Bauzon and now transferred to Luis and Eriberta Bauzon.  While tax declarations and receipts are not conclusive evidence of ownership, yet,  when coupled with proof of actual possession, as in the instant case, tax declarations and receipts are strong evidence of ownership.[6]

Even assuming that the donation proper nuptias is void for failure to comply with formal requisites,[7] it could still constitute a legal basis for adverse possession.  With clear and convincing evidence of possession, a private document of donation may serve as basis for a claim of ownership. [8] In Pensader v. Pensader[9] we ruled that while the verbal donation under which  the  defendant  and  his  predecessors-in-interest have been in possession of the lands in question is not effective as a transfer of title, still it is a circumstance which may explain the adverse and exclusive character of the possession.  In Espique v. Espique[10] we held -

There is no question that the donation in question is invalid because it involves an immovable property and the donation was not made in a public document as required by Article 633 of the old Civil Code, in connection with Article 1328 of the same Code (concerning gifts propter nuptias), but it does not follow that said donation may not serve as basis of acquisitive prescription when on the strength thereof the done has taken possession of the property adversely and in the concept of owner, or, as this Court well said:  ‘While the verbal donation, under which the defendants and his predecessors-in-interest have been in  possession of the lands in question, is not effective as a transfer of title, yet it is a circumstance which may explain the adverse and exclusive character of the possession’ (Pensader v. Pensader, 47 Phil. 673, 680).  This is also an action for partition.  It was shown that the donation of the property was made not even in a private document but only verbally.  It was also shown that the defendants, through their predecessors-in-interest, were in adverse and continuous possession of the lands for a period of over 30 years.  Yet, the court decided the case in favor of defendants on the ground of acquisitive prescription.  There is a close parallelism between the facts of this case and the present.

x x x x

We do not need to stretch our mind to see that under such allegations plaintiffs intended to convey the idea that defendant has possessed the lands openly, adversely and without interruption from 1916 to 1949 for he is the one who has possessed and reaped the whole benefit thereof.  As to the character of the possession held by defendant during that period one cannot also deny that it is in the concept of owner considering that the lands were donated to him by his predecessors-in-interest on the occasion of his marriage even if the same was not embodied in a public instrument.  The essential elements constituting acquisitive prescription are therefore present which negative the right of plaintiffs to ask for partition of said properties.  On this point we find pertinent the following observation of the trial court:  ‘Any person who claims right of ownership over immovable properties and does not invoke that right but instead

tolerated others in possession for thirty years is guilty of laches and negligence and he must suffer the consequence of his acts.’

In the instant case, Roque Bauzon possessed the subject parcels of land in the concept of owner by virtue of the donation propter nuptias. The possession was public as it was Roque Bauzon who personally tilled and cultivated the lots.  The acts of reaping the benefits of ownership were manifest and visible to all.  These acts were made more pronounced and public considering that the parcels of land are located in a municipality wherein ownership and possession are particularly and normally known to the community.  Roque peacefully possessed the properties as he was never ousted therefrom nor prevented from enjoying their fruits.  His possession was uninterrupted and in good faith because of his well-founded belief that the donation propter nuptias was properly executed and the grantors were legally allowed to convey their respective shares in his favor.  He likewise appropriated to himself the whole produce of the parcels of land to the exclusion of all others.

The donation propter nuptias was effected as early as 21 April 1926.  It was only in 1986 when the heirs of Segunda Maningding demanded partition of the properties and conveyance of the produce.   Sixty (60) years have already elapsed.  Even granting that Roque Bauzon possessed the properties only upon the death of his father in 1948, more than thirty (30) years have already passed.  In either case, acquisitive prescription has already set in in favor of Roque Bauzon.

Again, even if we assume the absence of good faith and just title, the ownership of the two (2) parcels would still appertain to Roque Bauzon.  As testified to by Delfin Parayno, one of petitioners, Roque Bauzon and his heirs had been in continuous, adverse and public possession of the property since 1948 up to 1986, or a period of thirty-six (36) years, which is more than the required thirty-year extraordinary prescription.

Prescription, as a rule, does not run in favor of a co-heir or co-owner as long as he expressly or impliedly recognizes the co-ownership.[11]Co-owners cannot acquire by prescription the share of the other co-owners, absent a clear repudiation of the co-ownership.  In order that title may prescribe in favor of one of the co-owners, it must be clearly shown that he has repudiated the claims of the others, and that they were apprised of his claim of adverse and exclusive ownership, before the prescriptive period would begin to run.  Mere refusal to accede to a partition, without specifying the grounds for such refusal, cannot be considered as notice to the other co-owners of the occupant’s claim of title in himself in repudiation of the co-ownership.  The evidence relative to the possession, as a fact upon which the alleged prescription is based, must be clear, complete and conclusive 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 adverse and exclusive and opposed to the rights of the others, the case is not one of ownership, and partition will lie.[12]

Therefore while prescription among co-owners cannot take place when the acts of ownership exercised are vague and uncertain, such prescription arises and produces all its effects when the acts of ownership do not evince any doubt as to the ouster of the rights of the other co-owners. [13] As disclosed by the records, Roque Bauzon and his heirs possessed the property from 1948 to 1986 to the exclusion of petitioners who were never given their shares of the fruits of the properties, for which reason they demanded an accounting of the produce and the conveyance to them of their shares.   Unfortunately they slept on their rights and allowed almost thirty-six (36) years to lapse before attempting to assert their right.  Perforce, they must suffer the consequence of their inaction.

WHEREFORE, the petition is DENIED.  The Resolution of the Court of Appeals of 7 July 1995 which modified its Decision of 29 November 1994 and holding that the deceased Roque Bauzon acquired the disputed two (2) parcels of land by acquisitive prescription is AFFIRMED. Costs against petitioners.

SO ORDERED.