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CASE INFORMATION

CASE TITLE: GR NUMBER:


AYSON V. SPOUSES PARAGAS 146730
PONENTE: DATE DECIDED: DIGEST WRITTEN BY:
NACHURA,J. 4-JUL-08 ABRAHAM GUIYAB

FACTS:

MAXIMA PARAGAS HAD BEEN LIVING IN A PARTICULAR PARCEL OF LAND SINCE AT LEAST 1913, AND HAS BEEN LIVING
THERE WITH HUSBAND FELIX PARAGS SINCE THE 1940S. IN 1955, FELIX PARAGAS WAS FOUND TO HAVE
DEFALCATED(MISAPPROPRIATED) MONEY FROM DAGUPAN UNIVERSITY IN THE AMOUNT OF P3000. RATHER THAN
PRESSING CHARGES, AYSON AND RAYOS, BOTH EMPLOYEES OF DAGUPAN UNIVERSITY OFFERED THEM THE OPTION OF
PAYING BACK THE AMOUNT DEFALCATED THROUGH SALARY DEDUCTIONS, WHICH THEY AGREED TO. HOWEVER, IN
ADDITION TO THIS, AYSON AND RAYOS ALSO COMPELLED FELIX PARAGAS, AN 'UNLETTERED' MAN, TO EXECUTE A DEED
OF ABSOLUTE SALE IN THEIR FAVOROF THE LAND THEY LIVED IN UNDER THREAT OF CRIMINAL PROSECUTION FOR
ESTAFA IF THEY FAILED TO COMPLY. THEY AGREED, AND THE DEED WAS DULY REGSITERED. HOWEVER, THE
PARAGASES CONTINUED THE POSSESION OF THEIR PARCEL OF LAND UNDISTURBED FOR 38 YEARS, UNTIL THE
SUCCESSORS OF INTEREST OF RAYOS AND AYSON ONCE AGAIN COMPELLED FELIX PARAGAS TO EXECUTE AN AFFIDAVIT
TO THE EFFECT THAT HE OCCUPIED THE LAND ONLY 'UPON THE TOLERANCE OF THE OWNER, PAYING NO RENT
WHATSOEVER', AND THAT HE SHALL VACATE THE PREMISES AND REMOVE HIS SEMICONCRETE HOUSE THEREIN FROM 3
MONTHS OF THE EXECUTION OF SAID AFFIDAVIT. THE PARAGAS SPOUSES DID NOT VACATE THE PREMISES AFTER THE
PERIOD, AND HENCE AN EJECTMENT SUIT WAS FILED AGAINST THEM. THE PARAGASES COUNTERED BY ATTEMPTING TO
ANNUL THE CONTRACT, WHILE AYSON AND PARAGAS INVOKE THE DEFENSE OF PRESCRIPTION AND LACHES.

ISSUE:
WHETHER OR NOT THE ACTION TO ANNUL HAS PRESCRIBED
WHETHER OR NOT LACHES HAS SET IN
WHETHER OR NOT THE DEED OF ABSOLUTE SALE WAS IN REALITY AN EQUITABLE MORTGAGE

HELD:
ACTIONS TO ANNUL VOIDABLE CONTRACTS PRESCRIBE IN 4 YEARS FROM THE END OF THE VITIATION OF CONSENT
LACHES IS AN ACTION FOUNDED ON EQUITY
A SALE WHEREIN THE VENDOR STILL RETAINS POSSESION OF THE PROPERTY IS AN EQUITABLE MORTGAGE

THE VITIATION OF CONSENT DID NOT CEASE 4 YEARS AFTER 1955, WHEN THE CONTRACT WAS EXECUTED, IT ENDED
AFTER THE EJECTMENT PROCEEDINGS WERE INSTITUTED IN 1993
LACHES CANNOT BE APPRECIATED AGAINST THE PARAGASES, THEIR RIGHT OF ACTION ONLY ACRUING RECENTLY
THE SALE IS DEFINTIVELY IN REALITY AN EQUITABLE MORTGAGE
THE DEED OF ABSOLUTE SALE IN FAVOR OF AYSON AND RAYOS WAS HEREBY ANNULLED, AND THE PROPERTY SUBJECT
THEREOF WAS ONCE MORE RECONVEYED TO THE SPOUSES PARAGAS.

RELEVANT OBLICON PRINCIPLES:
-PRESCRIPTION, LACHES AND ESTOPPEL
-VOIDABLE CONTRACTS
-POSSESSION BY TOLERANCE OF OWNER

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