RULE 74

Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. 45904

September 30, 1938

Intestate estate of the deceased Luz Garcia. PABLO G. UTULO, applicantappellee,

vs.
LEONA PASION VIUDA DE GARCIA, oppositor-appellant.
Feliciano B. Gardiner for appellant.
Gerardo S. Limlingan for appellee.
IMPERIAL, J.:
This is an appeal taken by the oppositor from the order of the Court of First
Instance of the Province of Tarlac appointing the applicant as judicial administrator
of the property left by the deceased Luz Garcia.
Juan Garcia Sanchez died intestate, and in the proceedings instituted in the Court of
First Instance of Tarlac for the administration of his property (special proceedings
No. 3475), Leona Pasion Vda. de Garcia, the surviving spouse and the herein
oppositor, was appointed judicial administratrix. The said deceased left legitimate
children, named Juan Garcia, jr., Patrocinio Garcia and Luz Garcia who, with the
widow, are the presumptive forced heirs. Luz Garcia married the applicant Pablo G.
Utulo and during the pendency of the administration proceedings of the said
deceased, she died in the province without any legitimate descendants, her only
forced heirs being her mother and her husband. The latter commenced in the same
court the judicial administration of the property of his deceased wife (special
proceedings No. 4188), stating in his petition that her only heirs were he himself
and his mother-in-law, the oppositor, and that the only property left by the
deceased consisted in the share due her from the intestate of her father, Juan
Garcia Sanchez, and asking that he be named administrator of the property of said
deceased. The oppositor objected to the petition, opposing the judicial
administration of the property of her daughter and the appointment of the applicant
as administrator. She alleged that inasmuch as the said deceased left no
indebtedness, there was no occasion for the said judicial administration; but she
stated that should the court grant the administration of the property, she should be
appointed the administratrix thereof inasmuch as she had a better right than the
applicant. After the required publications, trial was had and the court, on August 28,
1936, finally issued the appealed order to which the oppositor excepted and
thereafter filed the record on appeal which was certified and approved.

The oppositor-appellant assigns five errors allegedly committed by the trial court,
but these assigned errors raise only two questions for resolution, namely: whether
upon the admitted facts the judicial administration of the property left by the
deceased Luz Garcia lies, with the consequent appointment of an administrator, and
whether the appellant has a better right to the said office than the appellee.
1. As to the first question, we have section 642 of the Code of Civil Procedure
providing in part that "if no executor is named in the will, or if a person dies
intestate, administration shall be granted" etc. This provision enunciates the general
rule that when a person dies living property in the Philippine Islands, his property
should be judicially administered and the competent court should appoint a qualified
administrator, in the order established in the section, in case the deceased left no
will, or in case he had left one should he fail to name an executor therein. This rule,
however, is subject to the exceptions established by sections 596 and 597 of the
same Code, as finally amended. According to the first, when all the heirs are of
lawful age and there are no debts due from the estate, they may agree in writing to
partition the property without instituting the judicial administration or applying for
the appointment of an administrator. According to the second, if the property left
does not exceed six thousand pesos, the heirs may apply to the competent court,
after the required publications, to proceed with the summary partition and, after
paying all the known obligations, to partition all the property constituting the
inheritance among themselves pursuant to law, without instituting the judicial
administration and the appointment of an administrator.
Construing the scope of section 596, this court repeatedly held that when a person
dies without leaving pending obligations to be paid, his heirs, whether of age or not,
are not bound to submit the property to a judicial administration and the
appointment of an administrator are superfluous and unnecessary proceedings
(Ilustre vs.Alaras Frondosa, 17 Phil., 321; Malahacan vs. Ignacio, 19 Phil., 434;
Bondad vs. Bondad, 34 Phil., 232; Baldemorvs. Malangyaon, 34 Phil., 367;
Fule vs. Fule, 46 Phil., 317).
In enunciating the aforesaid doctrine, this court relied on the provisions of articles
657, 659 and 661 of the Civil Code under which the heirs succeed to all the property
left by the deceased from the time of his death. In the case of Ilustre vs. Alaras
Frondosa, supra, it was said:
Under the provisions of the Civil Code (arts. 657 to 661), the rights to the
succession of a person are transmitted from the moment of his death; in
other words, the heirs succeeded immediately to all of the property of the
deceased ancestor. The property belongs to the heirs at the moment of the
death of the ancestor as completely as if the ancestor had executed and
delivered to them a deed for the same before his death. In the absence of
debts existing against the estate, the heirs may enter upon the
administration of the said property immediately. If they desire to
administer it jointly, they may do so. If they desire to partition it among
themselves and can do this by mutual agreement, they also have that
privilege. The Code of Procedure in Civil Actions provides how an estate

may be divided by a petition for partition in case they can not mutually
agree in the division. When there are no debts existing against the estate,
there is certainly no occasion for the intervention of an administrator in the
settlement and partition of the estate among the heirs. When the heirs are
all of lawful age and there are no debts, there is no reason why the estate
should be burdened with the costs and expenses of an administrator. The
property belonging absolutely to the heirs, in the absence of existing debts
against the estate, the administrator has no right to intervene in any way
whatever in the division of the estate among the heirs. They are co-owners
of an undivided estate and the law offers them a remedy for the division of
the same among themselves. There is nothing in the present case to show
that the heirs requested the appointment of the administrator, or that they
intervened in any way whatever in the present actions. If there are any
heirs of the estate who have not received their participation, they have
their remedy by petition for partition of the said estate.
In the cases of Malahacan vs. Ignacio, supra, Bondad vs. Bondad, supra,
and Baldemor vs. Malangyaon, supra, the same doctrine was reiterated. And in the
case of Fule vs. Fule, supra, this court amplified and ratified the same doctrine in
the following language:
Upon the second question Did the court a quo commit an error in
refusing to appoint an administrator for the estate of Saturnino Fule? it
may be said (a) that it is admitted by all of the parties to the present
action, that at the time of his death no debts existed against his estate and
(b) that all of the heirs of Saturnino Fule were of age.
In this jurisdiction and by virtue of the provisions of articles 657, 659 and
661 of the Civil Code, all of the property, real and personal, of a deceased
person who dies intestate, is transmitted immediately to his heirs. (To
Guioc-Co vs. Del Rosario, 8 Phil., 546; Ilustre vs. Alaras Frondosa, 17 Phil.,
321; Marin vs.Nacianceno, 19 Phil., 238; Malahacan vs. Ignacio, 19 Phil.,
434; Nable Jose vs. Uson, 27 Phil., 73; Bondadvs. Bondad, 34 Phil., 232;
Baldemor vs. Malangyaon, 34 Phil., 367.)
If then the property of the deceased, who dies intestate, passes
immediately to his heirs, as owners, and there are no debts, what reason
can there be for the appointment of a judicial administrator to administer
the estate for them and to deprive the real owners of their possession to
which they are immediately entitled? In the case of Bondad vs. Bondad (34
Phil., 232), Chief Justice Cayetano Arellano, discussing this question, said:
Under the provisions of the Civil Code (articles 657 to 661), the rights to
the succession of a person are transmitted from the moment of his death;
in other words, the heirs succeed immediately to all of the property of the
deceased ancestor. The property belongs to the heirs at the moment of the
death of the ancestor as completely as if the ancestor had executed and
delivered to them a deed for the same before his death. In the absence of
debts existing against the estate, the heirs may enter upon the

administration of the said property immediately. If they desire to

administer it jointly, they may do so. If they desire to partition it among
themselves and can do this by mutual agreement, they also have that
privilege. The Code of Procedure in Civil Actions provides how an estate
may be divided by a petition for partition in case they cannot mutually
agree in the division. (Sections 182-184, 196, and 596 of Act No. 190.)
When the heirs are all of lawful age and there are no debts there is no
reason why the estate should be burdened with the cost and expenses of
an administrator. The administrator has no right to intervene in any way
whatsoever in the division of the estate among the heirs when they are
adults and when there are no debts against the estate. (Ilustre vs. Alaras
Frondosa, supra; Bondad vs. Bondad, supra;
Baldemor vs.Malangyaon, supra.)
When there are no debts and the heirs are all adults, their relation to the
property left by their ancestor is the same as that of any other coowners or
owners in common, and they may recover their individual rights, the same
as any other coowners of undivided property. (Succession of Story, 3 La.
Ann., 502; Mcintyre vs.Chappell, 4 Tex., 187; Wood et ux. vs. Ford, 29
Miss., 57.)
xxx

xxx

xxx

The right of the heirs in cases like the one we are discussing, also exist in
the divisions of personal as well as the real property. If they cannot agree
as to the division, then a suit for partition of such personal property among
the heirs of the deceased owner is maintenable where the estate is not in
debts, the heirs are all of age, and there is no administration upon the
estate and no necessity thereof. (Jordan vs. Jordan, 4 Tex. Civ. App. Rep.,
559.)
It is difficult to conceive of any class or item of property susceptible of
being held in common which may not be divided by the coowners. It may
be of personal property as well as of real estate; of several parcels as well
as of a single parcel, and of non-contiguous as well as of adjacent tracts;
or of part only of the lands of the coowners as well as of the whole.
(Pickering vs. Moore, 67 N. H., 533; 31 L. R. A., 698; Pipes vs.Buckner, 51
Miss., 848; Tewksbury vs. Provizzo, 12 Cal., 20.)
We conceive of no powerful reason which counsels the abandonment of a doctrine
so uniformly applied. We are convinced that if the courts had followed it in all cases
to which it has application, their files would not have been replete with unnecessary
administration proceedings as they are now. There is no weight in the argument
adduced by the appellee to the effect that his appointment as judicial administrator
is necessary so that he may have legal capacity to appear in the intestate of the
deceased Juan Garcia Sanchez. As he would appear in the said intestate by the right

of the representation, it would suffice for him to allege in proof of his interest that
he is a usufructuary forced heir of his deceased wife who, in turn, would be a forced
heir and an interested and necessary party if she were living . In order to intervene
in said intestate and to take part in the distribution of the property it is not
necessary that the administration of the property of his deceased wife be instituted
an administration which will take up time and occasion inconvenience and
unnecessary expenses. 2. In view of the foregoing, there is no need to determine
which of the parties has preferential right to the office of administrator. The
appealed order should be reversed, with the costs of this instance to the applicantappellee. So ordered.
SECOND DIVISION
[G.R. No. L-21859. September 30, 1924. ]
INTESTATE OF SATURNINO FULE, deceased. CIRIACO FULE, PetitionerAppellant, v. ANASTASIO FULE ET AL., opponents-appellees.
Palma, Leuterio & Yamzon for Appellant.
Ramon Diokno for Appellees.

DECISION

JOHNSON, J. :

The record in this case presents two questions:chanrob1es virtual 1aw library
First. Was the appeal from the decision of the lower court perfected within the time
required by law? And,
Second. Did the court a quo commit an error in refusing to appoint an administrator
for the estate of Saturnino Fule, deceased?
FACTS
Saturnino Fule died on the 4th day of April, 1923, intestate. On the 2d day of July,
1923, Ciriaco Fule, one of the heirs, presented a petition in the Court of First
Instance of the Province of Laguna for the appointment of an administrator of the
estate of Saturnino Fule, deceased, and prayed specially for the appointment of
Cornelio Alcantara as such administrator. The petitioner further prayed that during
the pendency of the petition for the appointment of an administrator, the said
Cornelio Alcantara be then and there appointed as special administrator for said
estate. The petitioner alleged that at the time of the death of Saturnino Fule, he was
the owner of real and personal property located in the municipality of San Pablo,
Province of Laguna, of the value of P50,000 with a rental value of about P8,000 and
that, in addition to said real and personal property, he also left about P30,000 in

cash. The lower court on the day of the presentation of the petition appointed
Cornelio Alcantara as special administrator and required him to give a bond of
P8,000. On the 26th day of July, 1923, the special administrator presented in court
an inventory of the alleged property of the deceased.
On the 31st day of July, 1923, the oppositors, through their attorney Mr. Ramon
Diokno, appeared and presented a motion alleging that they were children of
Saturnino Fule and that they were all of age; that they opposed the appointment of
an administrator upon the ground that the deceased had left no debts and that his
property had already been partitioned among his children during his lifetime in
conformity with article 1056 of the Civil Code; that the special administrator had
taken possession of property of large value belonging to them, and had thereby
deprived them of their means of livelihood, and prayed that the order appointing a
special administrator be denied. To said motion there was annexed Exhibit A,
containing a list of property, personal and real, which the special administrator had
taken possession of, belonging to the oppositors.
On the 4th day of August, 1923, the oppositors, through their attorney, presented a
further opposition to the appointment of an administrator for said estate, alleging
again that the heirs of Saturnino Fule were all of age; that the deceased had left no
debts; that the property had been divided among his heirs during his lifetime; that
the special administrator had been appointed without any notification whatever,
neither personal nor by publication, to the heirs of the deceased, and that there was
no necessity for the appointment of a special administrator during the pendency of
the question, nor for the appointment of an administrator.
On the 14th day of August, 1923, the petitioner answered the motion of the
oppositors and opposed their petition for the revocation of the appointment of a
special administrator. He alleged that the oppositors had been requested to make a
partition of the property of the deceased; that no partition of the property of the
deceased had been made during the lifetime of the deceased; that the property
described in Exhibit A attached to the motion of the oppositors was the exclusive
and absolute property of the petitioner, who had for more than forty years been in
the quiet, public, and exclusive possession of the same, as owner; and prayed that
the motion of the oppositors be denied.
Upon the issue thus presented, the Honorable Isidro Paredes, judge, on the 15th
day of August, 1923, revoked the appointment of the special administrator and
ordered him to render an account. On the same day (August 15, 1923) Judge
Paredes denied the appointment of an administrator, and suggested to the petitioner
that within thirty days from that date he should amend his petition and present an
ordinary action for the partition of the property of the state of the deceased, and in
case he should fail to do so it would be understood that the petition for the
appointment of an administrator is denied.
On the 5th day of September, 1923, the petitioner excepted to the orders of the
court of the 15th day of August, 1923, and on the same day presented a motion for
reconsideration, or new trial, and prayed that the court declare without effect the
orders of the 15th day of August and proceed to the appointment of an ordinary
administrator who should present to the court a project of partition of the property
involved, for approval. On the 11th day of September, 1923, the oppositors, through
their attorney, opposed the motion for reconsideration or new trial upon the ground

that the judgment of the court of the 15th day of August had become final and nonappealable.
On the 17th day of September, 1923, the court a quo, considering said motion for
reconsideration or new trial and opposition thereto, annulled and set aside that part
of the order of the court of the 15th day of August, which granted to the petitioner
the right to amend his petition, and fixed the 4th day of October, 1923, for a
continuation of the proof upon the question of the appointment of an administrator.
On the 26th day of October, 1923, and after hearing the respective parties, the
Honorable Isidro Paredes, denied the petition for the appointment of an
administrator upon the principal ground that all of the property of Saturnino Fule
had been in the possession of his heirs for many years before his death; and that at
the time of his death there were no debts and no property to be administered. From
that judgment the petitioner appealed.
In this court the oppositors renewed their motion to dismiss the appeal for the
reason that it had not been presented within the period of twenty days as provided
in section 783 of Act No. 190. Said section provides that: "Any person legally
interested in any other order, decree, or judgment (other than those mentioned in
sections 781 and 782) of a court of first instance in the exercise of its jurisdiction in
special proceedings in the settlement of the states of deceased persons or the
administration of guardian and trustees, may appeal to the Supreme Court from
such order, decree, or judgment, when such order, decree, or judgment constitutes
a final determination of the rights of the parties so appealing, and the appeal shall
be effected in the manner provided in the two preceding sections: . . ." (within
twenty days).
The appellees argue that the appeal was not perfected within twenty days from the
15th day of August, 1923. They evidently overlooked the fact that the decree was
not a final decree for the reason that it gave the petitioner thirty days within to
decide whether he would amend his petition or present an ordinary action.
Inasmuch, therefore, as the petitioner had thirty days within which to decide just
what course he pursue, said decision could not become final until after the
expiration of thirty days or until the petitioner had decided just what course he
decide to take. That order of the court conceding him thirty days to decide the
option therein given, continued in force until the 17th day of September, when the
court decided the motion for reconsideration and granted to the petitioner to a final
hearing and judgment on the 26th day of October, 1923, and the appeal from the
final judgment of that date was perfected within the time provided for in the abovequoted provision of Act No. 190.
Our conclusion, therefore, is that the judgment of the 15th day of August, 1923,
was not final; that the final judgment rendered in the cause was on the 26th day of
October, 1923; that the appeal from the final judgment was perfected within time,
and therefore, the motion to dismiss the appeal for failure to perfect the same
within the statutory period is hereby denied.
Upon the second question Did the court a quo commit an error in refusing to
appoint an administrator for the estate of Saturnino Fule? it may be said (a) that
it is admitted by all of the parties to the present action, that at the time of his death
no debts existed against his estate and (b) that all of the heirs of Saturnino Fule
were of age.

In this jurisdiction and by virtue of the provisions of articles 657, 659 and 661 of
the Civil Code, all of the property, real and personal, of a deceased person who dies
intestate, is transmitted immediately to his heirs. (To Guioc-Co v. Del Rosario, 8
Phil., 546; Ilustre v. Alaras Frondosa, 17 Phil., 321; Marin v. Nacianceno, 19 Phil.,
238; Malahacan v. Ignacio, 19 Phil., 434; Nable Jose v. Uson, 27 Phil., 73; Bondad v.
Bondad, 34 Phil., 232; Baldemor v. Malangyaon, 34 Phil., 367.)
If then the property of the deceased, who dies intestate, passes immediately to his
heirs, as owners, and there are no debts, what reason can there be for the
appointment of a judicial administrator to administer the estate for them and
deprive the real owners of their possession to which they are immediately entitled?
In the case of Bondad v. Bondad (34 Phil., 232), Chief Justice Cayetano Arellano,
discussing this question, said:" Under the provisions of the Civil code (articles 657
to 661), the rights to the succession of a person are transmitted from the moment
of his death; in other words, the heirs succeed immediately to all of the property of
the deceased ancestor. The property belongs to the heirs at the moment of the
death of the ancestor as completely as if the ancestor had executed and delivered to
them a deed for the same before his death. In the absence of debts existing against
the estate, the heirs may enter upon the administration of the said property
immediately. If they desire to administer it jointly, they may do so. If they desire to
partition it among themselves and can do this by mutual agreement, they have also
the privilege. The Code of Procedure in civil Actions provides how an estate may be
divided by a petition for partition in case they cannot mutually agree in the
division." (Sections 182-184, 196, and 596 of Act No. 190.)
When the heirs are all of lawfully age and there are no debts there is no reason why
the estate should be burdened with the cost and expenses of an administrator. The
administrator has no right to intervene in any way whatsoever in the division of the
state among the heirs when they are adults and when there are no debts against
the estate, (Ilustre v. Alaras Frondosa, supra; Bondad v. Bondad, supra; Baldemor
v. Malangyaon, supra.)
When there are no debts and the heirs are all adults, their relation to the property
left by their ancestor is the same as that of any other coowners or owners in
common, and they may recover their individual rights, the same as any other
coowners of undivided property. (Succession of Story, 3 La. Ann., 502; McIntyre v.
Chappell, 4 Tex., 187; Wood et ux. v. Ford, 29 Miss., 57.)
And even when there are debts against the estate, the heirs, all being of age, may
pay the debts and divide the property among themselves according to their
respective rights, as heirs or as legatees in case of will, without probating the same,
and the effect of such division is to invest each party with a complete equitable title
to their particular share of state. (Carter v. Owens, 41 Ala., 217.)
The right of the heirs in cases like the one we are discussing, also exists in the
division of personal as well as the real property. If they cannot agree as to the
division, then a suit for partition of such personal property among the heirs of the
deceased owner is maintainable where the estate is not in debt, the heirs are all of
age, and there is no administration upon the estate and no necessity thereof.
(Jordan v. Jordan, 4 Tex. Civ. App. Rep., 559.)

It is difficult to conceive of any one class or item of property susceptible of being

held in common which may not be divided by the coowners. It may be of personal
property as well as of real estate; of several parcels as well as of a single parcel,
and of non-contiguous as well as of adjacent tracts; or of part only of the lands of
the coowners as well as of the whole. (Pickering v. Moore, 67 N. H., 533; 31 L. R.
A., 699; Pipes v. Buckner, 51 Miss., 848; Tewksbury v. Provizzo, 12 Cal., 20.)
Therefore, and for all of the foregoing reasons, the judgment appealed from is
hereby affirmed, without any finding as to costs, and without prejudice to the right
of the petitioner to commence a new action for a partition of any property left by
Saturnino Fule which had not already been partition among his heirs. So ordered.
Avancea, Villamor, and Romualdez, JJ., concur.
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. L-81147 June 20, 1989
VICTORIA BRINGAS PEREIRA, petitioner,
vs.
THE HONORABLE COURT OF APPEALS and RITA PEREIRA
NAGAC, respondents.
Benjamin J. Quitoriano for petitioner.
Linzag-Arcilla & Associates Law Offices for private respondent.

GANCAYCO, J.:
Is a judicial administration proceeding necessary when the decedent dies intestate
without leaving any debts? May the probate court appoint the surviving sister of the
deceased as the administratrix of the estate of the deceased instead of the surviving
spouse? These are the main questions which need to be resolved in this case.
Andres de Guzman Pereira, an employee of the Philippine Air Lines, passed away on
January 3, 1983 at Bacoor, Cavite without a will. He was survived by his legitimate
spouse of ten months, the herein petitioner Victoria Bringas Pereira, and his sister
Rita Pereira Nagac, the herein private respondent.
On March 1, 1983, private respondent instituted before Branch 19 of the Regional
Trial Court of Bacoor, Cavite, Special Proceeding No. RTC-BSP-83-4 for the issuance

of letters of administration in her favor pertaining to the estate of the deceased

Andres de Guzman Pereira. 1 In her verified petition, private respondent alleged the
following: that she and Victoria Bringas Pereira are the only surviving heirs of the
deceased; that the deceased left no will; that there are no creditors of the
deceased; that the deceased left several properties, namely: death benefits from
the Philippine Air Lines (PAL), the PAL Employees Association (PALEA), the PAL
Employees Savings and Loan Association, Inc. (PESALA) and the Social Security
System (SSS), as well as savings deposits with the Philippine National Bank (PNB)
and the Philippine Commercial and Industrial Bank (PCIB), and a 300 square meter
lot located at Barangay Pamplona, Las Pinas, Rizal and finally, that the spouse of the
deceased (herein petitioner) had been working in London as an auxiliary nurse and
as such one-half of her salary forms part of the estate of the deceased.
On March 23,1983, petitioner filed her opposition and motion to dismiss the petition
of private respondent 2alleging that there exists no estate of the deceased for
purposes of administration and praying in the alternative, that if an estate does
exist, the letters of administration relating to the said estate be issued in her favor
as the surviving spouse.
In its resolution dated March 28, 1985, the Regional Trial Court, appointed private
respondent Rita Pereira Nagac administratrix of the intestate estate of Andres de
Guzman Pereira upon a bond posted by her in the amount of Pl,000.00. The trial
court ordered her to take custody of all the real and personal properties of the
deceased and to file an inventory thereof within three months after receipt of the
order. 3
Not satisfied with the resolution of the lower court, petitioner brought the case to
the Court of Appeals. The appellate court affirmed the appointment of private
respondent as administratrix in its decision dated December 15, 1987. 4
Hence, this petition for review on certiorari where petitioner raises the following
issues: (1) Whether or not there exists an estate of the deceased Andres de
Guzman Pereira for purposes of administration; (2) Whether or not a judicial
administration proceeding is necessary where there are no debts left by the
decedent; and, (3) Who has the better right to be appointed as administratrix of the
estate of the deceased, the surviving spouse Victoria Bringas Pereira or the
surviving sister Rita Pereira Nagac?
Anent the first issue, petitioner contends that there exists no estate of the deceased
for purposes of administration for the following reasons: firstly, the death benefits
from PAL, PALEA, PESALA and the SSS belong exclusively to her, being the sole
beneficiary and in support of this claim she submitted letter-replies from these
institutions showing that she is the exclusive beneficiary of said death benefits;
secondly, the savings deposits in the name of her deceased husband with the PNB
and the PCIB had been used to defray the funeral expenses as supported by several
receipts; and, finally, the only real property of the deceased has been extrajudicially

settled between the petitioner and the private respondent as the only surviving
heirs of the deceased.
Private respondent, on the other hand, argues that it is not for petitioner to decide
what properties form part of the estate of the deceased and to appropriate them for
herself. She points out that this function is vested in the court in charge of the
intestate proceedings.
Petitioner asks this Court to declare that the properties specified do not belong to
the estate of the deceased on the basis of her bare allegations as aforestated and a
handful of documents. Inasmuch as this Court is not a trier of facts, We cannot
order an unqualified and final exclusion or non-exclusion of the property involved
from the estate of the deceased. 5
The resolution of this issue is better left to the probate court before which the
administration proceedings are pending. The trial court is in the best position to
receive evidence on the discordant contentions of the parties as to the assets of the
decedent's estate, the valuations thereof and the rights of the transferees of some
of the assets, if any. 6 The function of resolving whether or not a certain property
should be included in the inventory or list of properties to be administered by the
administrator is one clearly within the competence of the probate court. However,
the court's determination is only provisional in character, not conclusive, and is
subject to the final decision in a separate action which may be instituted by the
parties. 7
Assuming, however, that there exist assets of the deceased Andres de Guzman
Pereira for purposes of administration, We nonetheless find the administration
proceedings instituted by private respondent to be unnecessary as contended by
petitioner for the reasons herein below discussed.
The general rule is that when a person dies leaving property, the same should be
judicially administered and the competent court should appoint a qualified
administrator, in the order established in Section 6, Rule 78, in case the deceased
left no will, or in case he had left one, should he fail to name an executor
therein. 8 An exception to this rule is established in Section 1 of Rule 74. 9 Under
this exception, when all the heirs are of lawful age and there are no debts due from
the estate, they may agree in writing to partition the property without instituting
the judicial administration or applying for the appointment of an administrator.
Section 1, Rule 74 of the Revised Rules of Court, however, does not preclude the
heirs from instituting administration proceedings, even if the estate has no debts or
obligations, if they do not desire to resort for good reasons to an ordinary action for
partition. While Section 1 allows the heirs to divide the estate among themselves as
they may see fit, or to resort to an ordinary action for partition, the said provision
does not compel them to do so if they have good reasons to take a different course
of action. 10 It should be noted that recourse to an administration proceeding even if
the estate has no debts is sanctioned only if the heirs have good reasons for not

resorting to an action for partition. Where partition is possible, either in or out of

court, the estate should not be burdened with an administration proceeding without
good and compelling reasons. 11
Thus, it has been repeatedly held that when a person dies without leaving pending
obligations to be paid, his heirs, whether of age or not, are not bound to submit the
property to a judicial administration, which is always long and costly, or to apply for
the appointment of an administrator by the Court. It has been uniformly held that in
such case the judicial administration and the appointment of an administrator are
superfluous and unnecessary proceedings . 12
Now, what constitutes "good reason" to warrant a judicial administration of the
estate of a deceased when the heirs are all of legal age and there are no creditors
will depend on the circumstances of each case.
In one case,

13

We said:
Again the petitioner argues that only when the heirs do not have
any dispute as to the bulk of the hereditary estate but only in the
manner of partition does section 1, Rule 74 of the Rules of Court
apply and that in this case the parties are at loggerheads as to the
corpus of the hereditary estate because respondents succeeded in
sequestering some assets of the intestate. The argument is
unconvincing, because, as the respondent judge has indicated,
questions as to what property belonged to the deceased (and
therefore to the heirs) may properly be ventilated in the partition
proceedings, especially where such property is in the hands of one
heir.

In another case, We held that if the reason for seeking an appointment as

administrator is merely to avoid a multiplicity of suits since the heir seeking such
appointment wants to ask for the annulment of certain transfers of property, that
same objective could be achieved in an action for partition and the trial court is not
justified in issuing letters of administration. 14 In still another case, We did not find
so powerful a reason the argument that the appointment of the husband, a
usufructuary forced heir of his deceased wife, as judicial administrator is necessary
in order for him to have legal capacity to appear in the intestate proceedings of his
wife's deceased mother, since he may just adduce proof of his being a forced heir in
the intestate proceedings of the latter. 15
We see no reason not to apply this doctrine to the case at bar. There are only two
surviving heirs, a wife of ten months and a sister, both of age. The parties admit
that there are no debts of the deceased to be paid. What is at once apparent is that
these two heirs are not in good terms. The only conceivable reason why private
respondent seeks appointment as administratrix is for her to obtain possession of
the alleged properties of the deceased for her own purposes, since these properties
are presently in the hands of petitioner who supposedly disposed of them

fraudulently. We are of the opinion that this is not a compelling reason which will
necessitate a judicial administration of the estate of the deceased. To subject the
estate of Andres de Guzman Pereira, which does not appear to be substantial
especially since the only real property left has been extrajudicially settled, to an
administration proceeding for no useful purpose would only unnecessarily expose it
to the risk of being wasted or squandered. In most instances of a similar
nature, 16 the claims of both parties as to the properties left by the deceased may
be properly ventilated in simple partition proceedings where the creditors, should
there be any, are protected in any event.
We, therefore, hold that the court below before which the administration
proceedings are pending was not justified in issuing letters of administration, there
being no good reason for burdening the estate of the deceased Andres de Guzman
Pereira with the costs and expenses of an administration proceeding.
With the foregoing ruling, it is unnecessary for us to delve into the issue of who, as
between the surviving spouse Victoria Bringas Pereira and the sister Rita Pereira
Nagac, should be preferred to be appointed as administratrix.
WHEREFORE, the letters of administration issued by the Regional Trial Court of
Bacoor to Rita Pereira Nagac are hereby revoked and the administration proceeding
dismissed without prejudice to the right of private respondent to commence a new
action for partition of the property left by Andres de Guzman Pereira. No costs.
SO ORDERED.

Petitioner Filomena G. Pizarro, is the surviving spouse of the late Aurelio Pizarro, Sr.,
while the other petitioners, Misael, Aurelio, Jr., Luzminda, Delia-Thelma, Rogelio,
Virgilio, Rosalinda, Jose Elvin and Maria Evelyn, all surnamed Pizarro, as well as
respondents Alicia P. Ladisla and Lydia P. Gudani, are their children. Upon the death
of Aurelio Pizarro, Sr., Special Proceedings No. 1421 entitled "In the Intestate Estate
of the Deceased Aurelio Pizarro, Sr.," was instituted by petitioners through Atty.
Regalado C. Salvador on September 21, 1965 in the Court of First Instance of
Davao, Branch I, presided by Judge Vicente P. Bullecer. Listed among the properties
of the estate were parcels of land situated in Agdao, J. Palma Gil, and Claro M.
Recto Streets, Davao City. On December 23, 1965, the Court, upon agreement of
the parties, appointed Gaudencio A. Corias, Clerk of Court of said Court, as
Administrator of the estate.chanrobles.com.ph : virtual law library
On January 11, 1967, the Administrator, through Atty. Regalado C. Salvador, filed a
Motion for Authority to Sell the properties located at Agdao and Jose Palma Gil
Streets, Davao City, to settle the debts of the estate initially estimated at
P257,361.23, including inheritance and estate taxes. The heirs, Alicia P. Ladisla and
Lydia P. Gudani, opposed the Motion stating that the claims against the estate had
not yet been properly determined and that the sale of the Agdao lot with an area of
13,014 sq. ms. would be more than sufficient to cover the supposed obligations of
the estate, which they claimed were exaggerated.
FIRST DIVISION
[G.R. No. L-31979. August 6, 1980.]
FILOMENA G. PIZARRO, MISAEL G. PIZARRO, AURELIO PIZARRO, JR.,
LUZMINDA G. PIZARRO, DELIA-THELMA G. PIZARRO, ROGELIO G. PIZARRO,
VIRGILIO G. PIZARRO, ROSALINDA G. PIZARRO, JOSE ELVIN G. PIZARRO
and MARIA EVELYN G. PIZARRO, Petitioners, v. THE HONORABLE COURT OF
APPEALS, HONORABLE MANASES G. REYES, JUDGE OF BRANCH III OF THE
COURT OF FIRST INSTANCE OF DAVAO, HONORABLE VICENTE P. BULLECER,
JUDGE OF BRANCH IV OF THE COURT OF FIRST INSTANCE OF DAVAO,
ALFONSO L. ANGLIONGTO JR., FELICITAS YAP ANGLIONGTO, GAUDENCIO
A. CORIAS, REGALADO C. SALAVADOR, ALICIA P. LADISLA and LYDIA P.
GUDANI, Respondents.

DECISION

MELENCIO-HERRERA, J.:

A review of the Decision of the Court of Appeals in CA-G.R. No. 42507-R, entitled
Filomena Pizarro, Et. Al. v. Hon. Manases G. Reyes, Et Al., dismissing the petition
for Certiorari and Mandamus with Prohibition and Preliminary Injunction which
sought to nullify the Order of the Court of First Instance of Davao, Branch III, dated
April 10, 1968, dismissing Civil Case No. 5762.
The controversy stemmed from the following facts:chanrob1es virtual 1aw library

The Court, in its Order dated February 7, 1967, authorized the sale "in the interest
of the parties" and since majority of the heirs were in favor of the sale "to avoid
unnecessary additional burden of about P2,000.00 every month." 1 On February 8,
1867, the Administrator moved for the approval of the conditional sale of the Agdao
property to Alfonso L. Angliongto for a total consideration of P146,820.00 payable in
six installments including the down payment. 2 The document of sale stipulated that
the vendor was to cause the ejectment of all occupants in the property on or before
July 31, 1967, otherwise, the vendee was to have the right to rescind the sale and
demand reimbursement of the price already paid. The heirs filed a Motion, also
dated February 8, 1967, to set aside or hold in abeyance the Order authorizing the
sale on the ground that they were negotiating for the sale of said lot to Mr.
Benjamin Gonzales, whose theatre was being constructed on a 1,187 square meter
portion thereof. 3
The Court, in its Order dated February 9, 1967, denied the "Motion to Set Aside"
stating that the grounds relied upon by the heirs were "nothing but speculations and
had no legal basis." 4 The heirs moved for reconsideration alleging that they were
being deprived of the right to a more beneficial sale. 5 On February 11, 1967, a
hearing was held on the Motion for approval of the sale of the Agdao lot to Alfonso
Angliongto. 6 The heirs maintained their objection on the grounds that 1) the sale
would be improvident and greatly prejudicial; 2) there has been no determination of
the debts or obligations of the estate as yet; and 3) the terms of the sale were very
prejudicial to them. The Court denied reconsideration on February 20, 1967, 7 and
approved the sale on the same date stating that "the sale sought to be approved
was more beneficial."cralaw virtua1aw library
On February 22, 1967, the Administrator presented another Motion for Authority to
Sell the Claro M. Recto lot stating that the proceeds from the sale of the Agdao lot
were not sufficient to settle the obligations of the estate and that the sale of the

property on J. Palma Gil Street was unanimously opposed by the heirs. Authority
was granted by the Court on March 6, 1967. 8
Prior to this, the heirs, in a Motion dated February 27, 1967 prayed that
Administrator Gaudencio A. Corias be asked to resign or be removed for having
abused his powers and duties as such and that Letters of Administration be granted
instead to Filomena Pizarro. 9 They also terminated the services of Atty. Regalado
C. Salvador, who had acted likewise as counsel for the Administrator.
On March 11, 1967, the Administrator moved that he be allowed to resign.
On June 22, 1967, the heirs, except Alicia P. Ladisla and Lydia P. Gudani, filed a
"Motion for Cancellation or Rescission of Conditional Contract of Sale" of the Agdao
lot in favor of Alfonso L. Angliongto reiterating that it was unnecessary and
prejudicial to their interests, that the sale of the lot in Claro M. Recto Street for
P370,000.00 was more than sufficient to settle the obligations of the estate, that it
was impossible to eject all nineteen tenants, not later than July 31, 1967, and that
the vendee had failed to pay the last four installments due despite repeated
demands. 10 Angliongtos counsel countered that the condition of the sale requiring
the prior ejectment of squatters had not been complied with so that the vendee
would hold in abeyance payment of the balance of the purchase price until all the
squatters were ejected. 11 The Court denied rescission of the sale in its Order,
dated July 3, 1967, stating that the relief prayed for is not within its power to grant,
and that the heirs "should file the necessary action before a competent Court not
before this Court, and much less by mere motion." 12 The heirs moved to
reconsider the said Order. In the meantime, Judge Bullecer was transferred to the
Court of First Instance at Mati, Davao Oriental.chanrobles law library
On July 6, 1967, the Administrator presented a "Motion to Approve Final Sale" of
the Agdao lot to spouses Angliongtos stating that the latter had paid the full balance
of P58,728.00. On the same date, the Court approved the same. 13 It appears that
Transfer Certificate of Title No. T-19342 was issued in favor of Alfonso Angliongto on
July 10, 1967. 14
On July 13, 1967, Gaudencio Corias ceased to be Administrator. 15
Without waiting for the resolution of their Motion for Reconsideration of the Order
denying rescission of the sale, the heirs, except Alicia P. Ladisla and Lydia P. Gudani,
filed on October 5, 1967, a verified Complaint for "Cancellation of Authority to Sell
and Rescission and Annulment of Deed of Sale and Damages with Preliminary
Injunction" (Civil Case No. 5762, hereinafter called the Rescission Case) in the Court
of First Instance of Davao (raffled to Branch III), against the Angliongto spouses,
Administrator Gaudencio A. Corias, Judge Vicente P. Bullecer, Atty. Regalado C.
Salvador, Alicia P. Ladisla and Lydia P. Gudani, 16 the latter two having refused to
join as plaintiffs. Petitioners contended inter alia that despite all their efforts to
block the sale "the Administrator taking advantage of the name and influence of the
presiding Judge" succeeded in inducing Angliongto to purchase the lot at a price
allegedly much higher than the reported P12.00 per square meter; that the sale
contained an impossible condition which was the ejectment of the tenants before a
certain date; that there was connivance between the Administrator and the vendee
with the knowledge of the Judge and Atty. Regalado Salvador; and that they had
suffered actual and moral damages by reason of the sale. They also prayed that

since the vendees had entered the lot and destroyed improvements thereon, that
they be enjoined from doing so. Attached to the Complaint was a letter 17
addressed to the surviving spouse, Filomena G. Pizarro, from Atty. Raul Tolentino to
the effect that the sum of P58,728.00 issued by Alfonso Angliongto in favor of the
estate and which was deposited by virtue of a Court Order had been dishonored by
the Bank because of a stop-payment order of Angliongto.
All the defendants except Judge Bullecer and Atty. Corias who filed a Motion to
Dismiss, presented their respective Answers. Eventually, however, they all adopted
the same Motion predicated mainly on plaintiffs lack of legal capacity to sue and
lack of cause of action. 18 In addition, the Angliongtos pleaded res judicata, the
sale having been approved by the Court as far back as February 20, 1967 and the
final deed on July 6, 1967, and the corresponding title issued in the name of Alfonso
Angliongto on July 10, 1967. Plaintiffs filed an Opposition 19 as well as a
supplemental Opposition. 20
On October 17, 1967, Judge Alfredo I. Gonzales, as Executive Judge, issued an
Order enjoining the Angliongtos, their agents, laborers, representatives, from
further cutting and destroying coconuts, other fruits and improvements on the
property pending the final termination of the action or until a contrary order is
issued by the Court, upon the filing of a bond in the amount of P25,000.00. 21
On April 10, 1968, the trial Court (respondent Judge Manases G. Reyes presiding)
dismissed the Rescission Case (Civil Case No. 5762) on the ground that it could not
review the actuations of a coordinate Branch of the Court besides the fact that a
Motion for Reconsideration was still pending resolution before the Probate Court. 22
Plaintiffs Motion for Reconsideration of the dismissal Order was denied on October
10, 1968.
While the Rescission Case was pending, the Angliongtos filed Civil Case No. 5849 for
Damages (the Angliongtos Case) against the heirs.
On November 25, 1968, petitioners elevated their cause to the Court of Appeals
on" Certiorari and Mandamus with Prohibition and Injunction," charging that
respondent Judge Manases G. Reyes gravely abused his discretion in dismissing the
Rescission Case and prayed that he be required to take cognizance thereof and that
the Angliongtos be enjoined from exercising rights of ownership over the property.
On February 11, 1970, the Court of Appeals dismissed the Petition opining that the
Court of First Instance of Davao, Branch IV, did not abuse its discretion in approving
the sale in the Intestate Case (Sp. Proc. No. 1421), and even granting that it did,
the proper remedy was appeal not Certiorari; that the Court of First Instance,
Branch III, neither abused its discretion in dismissing the Rescission Case (Civil
Case No. 5762) as that case sought to review the actuations of a coordinate Branch
which is beyond its judicial competence; and that since said dismissal was final, the
proper remedy was appeal. It also observed that copies of the Orders sought to be
reviewed were not certified true copies and, therefore, violative of Section 1, Rule
65 of the Rules of Court.
The present Petition before us seeks a reversal of the aforestated findings of the
Appellate Court anchored on the principal contentions that the sale of the Agdao
property should be rescinded for failure of the vendees to pay the purchase price,

and that actually no review of the actuations of a co-equal Branch of the Court is
being sought. We gave due course to the Petition on June 8,
1970.chanroblesvirtualawlibrary
In a Manifestation filed by petitioners on March 29, 1976, 23 they disclosed that the
Angliongtos had mortgaged the Agdao property to the Development Bank of the
Philippines in Davao City, in violation of the injunctive Order of the lower Court, and
after redeeming the same, caused the property to be subdivided into three lots and
titled in their names. Subsequently, they allegedly sold the biggest portion
containing 11,500 sq. ms. to Yu Cho Khai and Cristina Sy Yu for P250,000.00 on
October 25, 1975. Title to said portion has been allegedly transferred in favor of
said vendees.
The primary point tendered for resolution is the correctness of the ruling of the
Court of Appeals upholding the opinion of the trial Court that the latter was devoid
of authority to review the actuations of a coordinate Branch of the Court.
Secondarily, the propriety of the extra-ordinary remedy of Certiorari despite the
existence of the remedy of appeal is also in issue.

taken cognizance of and to have heard the Rescission Case on the merits and it was
reversible error for the Court of Appeals to have upheld its dismissal.
In so far as the non-presentation of a certified true copy of the Order of April 10,
1968, sought to be reviewed, its concerned, there seems to have been substantial
compliance with section 1, Rule 65, of the Rules of Court since the copy of the Order
submitted is a duplicate copy of the original and bears the seal of the Trial Court.
Lawyers should bear in mind, however, that a faithful compliance with the Rules is
still the better practice.
WHEREFORE, the judgment of the Court of Appeals is reversed, and the incumbent
Judge of the Court of First Instance of Davao, Branch III, is hereby ordered to take
cognizance of and hear and decide Civil Case No. 5762 as expeditiously as possible.
SO ORDERED.

Certiorari should lie.

While an Order of dismissal is, indeed, final and appealable as it puts an end to
litigation and leaves nothing more to be done on the merits in the lower Court, 24
so that Certiorari is ordinarily unavailable, that general rule allows of exceptions,
namely, when appeal is inadequate and ineffectual or when the broader interest of
justice so requires. 25 In this case, appeal would not have afforded the heirs an
effective and speedy recourse. It would have entailed a protracted litigation and in
the interim, the heirs stood to suffer as a consequence of the approval of the sale.
The prompt stoppage of that sale was vital to them. Thusly, appeal not being
speedy enough to bring about the desired objective and to be of any utility to the
heirs, their availment of Certiorari must be held to have been proper.
We come now to the question of correctness of the Order of dismissal of the trial
Court which the Appellate Tribunal had upheld. As a strict legal proposition, no
actuation of the Probate Court had to be Reviewed. There is no judicial interference
to speak of by one Court in the actuations of another co-equal Court. The Order
authorizing the sale was issued on February 20, 1967, and on July 6, 1967, the
Court gave its stamp of approval to the final sale. Title was issued in favor of the
vendees on July 10, 1967. To all intents and purposes, therefore, that sale had been
consummated; the Order approving the sale, final.
But, what petitioners sought to achieve in filing the Rescission Case was to rescind
the sale mainly for failure of the vendees to pay the full consideration thereof, 26
which is a valid ground for rescission. That cause of action was within the judicial
competence and authority of the trial Court (Branch III) as a Court of First Instance
with exclusive original jurisdiction over civil cases the subject matter of which is not
capable of pecuniary estimation. It was beyond the jurisdictional bounds of the
Probate Court (Branch IV) whose main province was the settlement of the estate.
As a matter of fact, the Rescission Case was instituted after the Probate Court itself
had stated that petitioners cause of action was not within its authority to resolve
but should be filed with the competent Court. The cause of action in one is different
from that obtaining in the other. It behooved the trial Court, therefore, to have

10

Assailed before Us in this appeal by certiorari under Rule 45 of the Rules of Court is
the decision of the respondent Court of Appeals in C.A.-G.R. CV No. 11934,
promulgated on 20 October 1989, 1 reversing the decision of 1 October 1986 of
Branch 21 (Imus, Cavite) of the Regional Trial Court of the Fourth Judicial Region in
Civil Case No. RTC-BCV-83-17 entitled Maria vda. de Reyes, et al. vs. Spouses
Dalmacio Gardiola and Rosario Martillano, and Spouses Ricardo M. Gardiola and
Emelita Gardiola, 2 and the resolution of 1 March 1990 denying the petitioner's
motion for reconsideration.
As culled from both decisions and the pleadings of the parties, the following facts
have been preponderantly established:
During his lifetime, one Gavino Reyes owned a parcel of land of approximately 70
hectares, more or less, located at Sangayad, Ulong-Tubig, Carmona, Cavite. He
sought to bring said land under the operation of the Torrens System of registration
of property. Unfortunately, he died in 1921 without the title having been issued to
him. The application was prosecuted by his son, Marcelo Reyes, who was the
administrator of his property.

Republic of the Philippines

SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 92436 July 26, 1991

In 1936 the above property was surveyed and subdivided by Gavino's heirs (Exh.
"6"). In the subdivision plan, each resultant lot was earmarked, indicated for and
assigned to a specific heir. It appears therein that two lots, one of which is Lot No. I
A-14 (Exh. "6-A"), were allotted to Rafael Reyes, Sr., one of Gavino's children. Per
testimony of Juan Poblete, the children thereafter secured tax declarations for their
respective shares.
In 1941, or about twenty (20) years after the death of Gavino, the original
certificate of title for the whole property OCT No. 255 was issued. It was,
however, kept by Juan Poblete, son-in-law of Marcelo Reyes, who was by then
already deceased. The heirs of Gavino were not aware of this fact.

MARIA VDA. DE REYES, EFREN REYES, ELVIRA REYES-TIMBOL, ERLINDA

REYES-VALERIO, ERNESTO REYES, ELIZABETH REYES, ALEX, RAFAEL II,
EMELINA and EVELYN, all surnamed REYES, represented by their mother,
MARIA VDA. DE REYES, petitioners,
vs.
THE COURT OF APPEALS AND SPOUSES DALMACIO GARDIOLA and
ROSARIO MARTILLANOrespondents.

On 3 December 1943, Rafael Reyes, Sr. sold a parcel of land with an area of 23,431
square meters, more or less, to private respondent Dalmacio Gardiola (Exh. "5").
According to the vendee, this parcel corresponds to Lot No. 1-A-14 of the
subdivision plan aforestated. The deed of sale, however, did not specifically mention
Lot No. 1-A-14. The vendee immediately took possession of the property and
started paying the land taxes therein.

De Lara, De Lunas & Rosales for petitioners.

In 1945 or thereabouts, Juan Poblete "revalidated" the original Certificate of Title.

As reconstituted, the new title isOCT (0-4358) RO-255 (Exhs. "4" to "4-A").

Santos, Pilapil & Associates for private respondents.

DAVIDE, JR., J.:p

On 21 October 1967, when the heirs of Gavino Reyes executed a Deed of

Extrajudicial Settlement of Estate (Exh. "D") based on the aforestated subdivision
plan (Exh. "6"), the lot that was intended for Rafael Reyes, Sr., who was already
deceased, was instead adjudicated to his only son and heir, Rafael Reyes, Jr. (the
predecessor-in-interest of the petitioners herein). Private respondent Rosario

11

Martillano signed the deed in representation of her mother, Marta Reyes, one of the
children of Gavino Reyes.

Carmona Inc. For their failure to redeem the mortgage the same
was foreclosed by the bank.

As a result of the Extrajudicial Settlement, OCT RO-255 was cancelled and in lieu
thereof, several transfer certificates of title covering the subdivided lots were issued
in the names of the respective adjudicatees. One of them is TCT No. 27257 in the
name of Rafael Reyes, Jr. covering Lot No. 1-A-14. The Transfer Certificates of Title
were, however, kept by one Candido Hebron. On 10 January 1969, some of the
heirs of Gavino Reyes filed a case of Annulment of Partition and Recovery of
Possession before the Court of First Instance of Cavite City, which was docketed
therein as Civil Case No. 1267. One of the defendants in said case is herein private
respondent Rosario Martillano. The case was dismissed on 18 September 1969, but
Candido Hebron was ordered by the trial court to deliver to the heirs concerned all
the transfer certificates of title in his possession. 3

10. However, within the period of one(1) year from such

foreclosure the questioned land was redeemed by the original
defendants' son in the person of Ricardo M. Gardiola, who was
knowledgeable/aware of the pendency of the above captioned
case. The corresponding redemption was effected through a deed
of conveyance, . . . . 6

After obtaining the Transfer Certificate of Title for Lot No. 1-A-14 from Hebron,
pursuant to the aforesaid order in Civil Case No. 1267, petitioners herein, as
successors-in-interest of Rafael Reyes, Jr., filed on 14 March 1983 with the Regional
Trial Court the above-mentioned Civil Case No. RTC-BCV-83-17 against private
respondents (defendants therein) for recovery of possession or, in the alternative,
for indemnification, accounting and damages. They allege therein that after "having
definitely discovered that they are the lawful owners of the property," (Lot No. 1-A14), they, "including Rafael Reyes, Jr., during his lifetime, made repeated demands
to (sic) defendants to surrender the possession of and vacate the parcel of land
belonging to the former, but defendants refused to vacate and surrender the
possession of the said land to herein plaintiffs;" the last of the demands was
allegedly made on 8 October 1982. They further allege that they have been
deprived by said defendants of the rightful possession and enjoyment of the
property since September 1969 which coincides with the date of the order in Civil
Case No. 1267. 4
In their answer, private respondents deny the material averments in the complaint
and assert that they are the owners of the lot in question, having bought the same
from Rafael Reyes, Sr., that the issuance of TCT No. 27257 is null and void, for such
sale was known to Rafael Reyes, Jr.; that they have been in possession of the
property and have been paying the land taxes thereon; and that petitioners are
barred by prescription and/or laches. 5
Petitioners amended their complaint on 21 March 1985 to implead as additional
defendants the spouses Ricardo M. Gardiola and Emerita Gardiola, on the basis of
the following claims:
xxx xxx xxx
9. Meanwhile, during the presentation of the defendants spouses
Dalmacio Gardiola and Rosario Martillano's evidence the former
testified that they mortgaged the subject land to the Rural Bank of

The prayer of the amended complaint now contains the alternative relief for
indemnification for the reasonable value of the property "in the event restitution of
the property is no longer possible." 7
In its decision of 1 October 1986, 8 the trial court concluded that petitioners' "title
over the subject property is valid and regular and thus they are entitled to its
possession and enjoyment," and accordingly decided thus:
WHEREFORE, the defendants or anyone acting for and in their
behalf are hereby ordered to relinguish possession or vacate the
property in question which is covered by Transfer Certificate of
Title No. T-27257 in favor of the plaintiffs.
All other claims and/or counterclaims of the parties relative to this
case are dismissed for lack of proper substantiation.
The conclusion of the trial court is based on its finding that (a) there is no evidence
that the heirs of Gavino Reyes entered into any written agreement of partition in
1936 based on the subdivision plan; (b) there is no identity between Lot No. 1-14-A
and the land sold to private respondents by Rafael Reyes, Sr., or otherwise stated,
the description of the latter as indicated in the deed of sale (Exh. "5") does not tally
with the description of the former; and (c) moreover:
Granting, arguendo, that the sale made by Rafael Reyes, Sr. to the
defendants covered the land in question Lot No. 1-A-14 and
that Transfer Certificate of Title No. T-27257 was obtained by
means of fraud, the claim of the defendants over the said property
is already barred. Action for reconveyance prescribes in four (4)
years from the discovery thereof. If there was fraud, the
defendant could have discovered the same in 1967 when the
partition was made in as much as defendant Rosario Martillano
was a party to that partition. Let us grant further that the
issuance of Transfer Certificate of Title No. T-27257 to Rafael
Reyes, Jr. created a constructive or implied trust in favor of the
defendants, again, the claim of the defendants is also barred.
From 1967 to the filing of their answer (let us consider this as an
action for reconveyance) to this case sometime in July, 1983, a

12

period of about sixteen (16) years had already elapsed.

Prescriptibility of an action for reconveyance based on implied or
constructive trust is ten (10) years.
The trial court further held that the continued possession by private respondents,
which it found to have started in 1943, did not ripen into ownership because at that
time, the property was already registered, hence it cannot be acquired by
prescription or adverse possession. 9
Private respondents appealed the said decision to the Court of Appeals which
docketed the appeal as C.A.-G.R. CV No. 11934. In its decision of 20 October 1989,
the respondent Court of Appeals formulated the issues before it as follows:
I
Whether or not the lower court erred in declaring that the
property of the late Gavino Reyes consisting of 70 hectares was
partitioned only in 1967 by his grandchildren after discovery of the
existence of OCT No. 255 and that no actual partition was made in
1936 by the decedent's children.
II
Whether or not the lower court erred in concluding that the parcel
of land sold by the appellees' predecessor-in-interest, the late
Rafael Reyes, Sr. to appellant Dalmacio Gardiola was not the same
parcel of land under litigation. 10
and resolved such issues, thus:
On the first issue, We believe that the lower court committed a
reversible error when it declared that the landed estate of the late
Gavino Reyes was partitioned only in 1967 by the latter's
grandchildren; and that no actual partition was made in 1936 by
the decedents' (sic) children. The evidence on record bears out
the existence of a subdivision plan (Exh. 6) which was not
controverted nor denied by the appellees. In like manner, the
lower court itself recognized the fact that the property of the late
Gavino Reyes consisting of 70 hectares was surveyed and
subdivided in 1936 as evidenced by the said subdivision plan
(Exh. 6). With the existence of a subdivision plan, and from the
uncontroverted testimony of appellants' witness, We can only infer
that at least an oral partition, which under the law is valid and
binding, was entered into by the heirs of Gavino Reyes regarding
his properties in 1936. As held in a long line of decisions,
extrajudicial partition can be done orally, and the same would be

valid if freely entered into (Belen v. Belen, 49 O.G. 997, March

1953). The reason for this is because a partition is not exactly a
conveyance for the reason that it does not involve transfer of
property from one to the other but rather a confirmation by them
of their ownership of the property. It must also be remembered
that when Gavino Reyes died on March 7, 1921, his property was
admittedly not yet covered by a torrens title, as it was only in
1941 when said properties were brought into the application of
the torrens system. With this factual milieu, it can also be
concluded that his heirs have indeed settled, subdivided and
partitioned Gavino Reyes' landed estate without formal
requirements of Rule 74 of the Rules of Court when a parcel of
land is covered by a torrens title. As told earlier, the Subdivision
Plan (Exh. 6) undisputedly showed on its face that the 70 hectares
of land belonging to the late Gavino Reyes was subdivided and
partitioned by his children in 1936. On this score, the partition of
the said property even without the formal requirements under the
rule is valid as held in the case of Hernandez vs. Andal, 78 Phil.
176, which states:
xxx xxx xxx
Moreover, in the Deed of Sale dated December 3, 1943 (Exh. 5)
executed by Rafael Reyes, Sr. in favor of appellant Dalmacio
Gardiola, the land sold therein was described as "na aking minana
sa aking ama." This alone would confirm the contention of the
appellants that there was already an actual partition (at least an
oral partition) of the property of Gavino Reyes in 1936. As
aforestated, the presence of the Subdivision Plan (Exh. 6) is an
(sic) evidence of such partition which appellees failed to
controvert not to mention the fact that the lower court itself
recognized the existence of said plan, in the same manner that it
concluded that the property was already surveyed and actually
subdivided in 1936 (page 3, pars. 3 and 4, Decision).
From the foregoing considerations it is evident that the Deed of
Extrajudicial Settlement of Estate (Exh. D) executed by the
grandchildren of the late Gavino Reyes in 1967 is of no moment
considering that the property subject of the partition in the deed
was already partitioned in 1936 by the children of Gavino Reyes.
It is for this reason that the lots supposedly inherited by the
grandchildren named in the deed of 1967 were the same lots
inherited and given to their respective fathers or mothers in 1936
while the land was not yet covered by the torrens system. Hence,
in the case of Rafael Reyes, Sr., the land inherited by him was two
(2) parcels of land known as Lots Nos. 1-A-3 and 1-A-14 described
in the Subdivision plan of 1936 (Exh. 6), which were the same
parcels of land allegedly inherited by Rafael Reyes, Jr. from Gavino

13

Reyes in representation of his father, pursuant to the Deed of

Extrajudicial Settlement of Estate for which TCT No. 27257 was
issued.
Coming to the second issue, the lower court likewise erred when it
concluded that the parcel of land sold by appellee's predecessorin-interest to appellant Dalmacio Gardiola was not the same parcel
of land under litigation. It must be pointed out that the identity of
the parcel of land which the appellees sought to recover from the
appellants was never an issue in the lower court, because the
litigants had already conceded that the parcel identified as Lot No.
1-A-14 in TCT No. 27257 was the same parcel of land identified as
Cadastral Lot No. 1228 and 1235 described in Tax Declaration No.
4766. Despite this admission, however, the lower court declared
that "as described in the deed of sale (Exh. 5), the land's
description does not tally with the description of Lot No. 1-A-14,
the land in litigation." As correctly pointed out by the appellants
however, the discrepancy in the description was due to the fact
that the description of the land sold in the Deed of Sale was
expressed in layman's language whereas the description of Lot No.
1-A-14 in TCT No. 27257 was done in technical terms. This was so
because, when Rafael Reyes, Sr. sold the property in dispute to
appellant Dalmacio Gardiola on December 3, 1943, the only
evidence of title to the land then available in so far as Rafael
Reyes, Sr. was concerned was Tax Declaration No. 4766, because
at that time, neither he nor appellant Dalmacio Gardiola was
aware of the existence of OCT No. 255 as in fact TCT No. 27257
was issued only in 1967. Consequently, the land subject of the
Deed of Sale was described by the vendor in the manner as
described in Tax Declaration No. 4766. However, the description of
the land appearing in the Deed of Sale (Exh. 5) was exactly the
same land identified as Lot No. 1-A-14 in the Subdivision Plan
(Exh. 6) of 1936. Accordingly, the assumption of the lower court
that "if the land sold by Rafael Reyes, Sr. was the one now in
litigation, he could have easily indicated Lot No. 1-A-14" is bereft
of merit under the foregoing circumstances. Interestingly enough,
the appellees never denied the identity of the subject lot during
the hearing at the lower court. What they were denying only was
the sale made by Rafael Reyes, Sr. to appellant Dalmacio Gardiola
which does not hold true because of the document denominated
as Deed of Sale (Exh. 5). 11
It concluded that the trial court erred when it ordered the private respondents or
anyone acting in their behalf to relinquish the possession or vacate the property in
question. It thus decreed:

the lawful owners of the lot identified as Lot No. 1-A-14 in TCT No.
27257. No
costs. 12
Their motion to reconsider the above decision having been denied by the Court of
Appeals in its resolution of 1 March 1990, 13 petitioners filed the instant petition on
6 April 1990 after having obtained an extension of time within which to file it.
The petition does not implead original new defendants Ricardo Gardiola and Emelita
Gardiola.
As ground for their plea for the review of the decision of the Court of Appeals,
petitioners allege that said court has decided questions of substance in a way not in
accord with law or applicable jurisprudence when it held that "the deed of
extrajudicial settlement of estate (Exh. "D") executed by the grandchildren of the
late Gavino Reyes in 1967 is of no moment considering that the property subject of
the partition was already partitioned in 1936 by the children of Gavino Reyes." In
support thereof, they claim that (a) TCT No. 27257 covers two parcels of land; the
lot described in paragraph 1 thereof is owned by petitioners and that ownership was
confirmed by this Court in G.R. No. 79882, hence, the Court of Appeals should have
affirmed the decision of the trial court; (b) private respondent Rosario Martillano
was a party to the extrajudicial settlement of estate which was duly registered in
the Registry of Deeds in 1967; said registration is the operative act that gives
validity to the transfer or creates a lien upon the land and also constituted
constructive notice to the whole world. The court cannot disregard the binding effect
thereof Finally, the pronouncement of the Court of Appeals that private respondents
are the lawful owners of the lot in question "militates against the indefeasible and
incontrovertible character of the torrens title,"14 and allows reconveyance which is
not tenable since the action therefor had already prescribed, as stated in the
decision of the trial court.
In the resolution of 7 May 1990, We required respondents to comment on the
petition. But even before it could do so, petitioner, without obtaining prior leave of
the Court, filed on 29 May 1990 a so-called Supplemental Arguments in Support of
The Petition For Review On certiorari 15 wherein they assert, among others, that: (a)
the findings of facts of respondent Court are contrary to those of the trial court and
appear to be contradicted by the evidence on record thus calling for the review by
this Court; 16 (b) it also committed misapprehension of the facts in this case and its
findings are based on speculation, conjecture and surmises; (c) private respondents'
attack on petitioners' title is a collateral attack which is not allowed; even if it is
allowed, the same had already prescribed and is now barred.
It was only on 15 June 1990 that private respondents filed their Comment. 17 We
required petitioners to reply thereto, which they complied with on 8 August
1990. 18 A rejoinder was filed by private respondents on 29 August 1990.

WHEREFORE, the appealed Judgment is ordered REVERSED and

SET ASIDE and a new one is rendered declaring appellants to be

14

We gave due course to the petition on 19 September 1990 and required the parties
to submit simultaneously their respective memoranda which they complied with.
Attached as Annex "A" to private respondent's Memorandum, which was filed on 10
December 1990, is the Resolution of this Court (Third Division) of 20 August 1990 in
G.R. No. 92811 entitled Spouses Artemio Durumpili and Angustia Reyes vs. The
Court of Appeals and Spouses Dalmacio Gardiola and Rosario Martillano, which also
involves the property of Gavino Reyes, the partition thereof among his children in
1936, and the extrajudicial settlement in 1967.
In said resolution, this Court held:
. . . The partition made in 1936, although oral, was valid. The
requirement in Article 1358 of the Civil Code that acts which have
for their object the creation, transmission, modification or
extinguishment of real rights over immovable property must
appear in a public instrument is only for convenience and not for
validity or enforceability as between the parties themselves.
[Thunga Hui vs. Que Bentec, 2 Phil. 561 (1903)] The subsequent
execution by the heirs of the Extrajudicial Partition in 1967 did not
alter the oral partition as in fact the share pertaining to Angustia
Reyes corresponded to that previously assigned to her father.
Considering that Angel Reyes sold this property to Basilio de
Ocampo who, in turn, sold the same to respondents, we agree
with the Court of Appeals that the latter lawfully acquired the
property and are entitled to ownership and possession thereof.
In answer to the charge of private respondents that petitioners deliberately failed to
cite this resolution, the latter, in their reply-memorandum dated 15 March 1991 and
filed three days thereafter, allege:
Our failure to mention the aforementioned resolution before this
Honorable Court is not deliberate nor with malice aforethought.
The reason is that to date, we have not yet received any
resolution to our Motion For Leave of Court To Refer Case To The
Honorable Supreme Court En Banc. Moreover, we honestly feel
that the resolution that will be issued therein will not be applicable
to the case before this Honorable Court's Second Division. It
should be mentioned that in the Durumpili case before the Third
Division, the Court of Appeals relied on the alleged confirmation of
the sale executed by Angustia Reyes, while in the Reyes case
before this Second Division, there was no sale that was executed
by the petitioners Reyes' predecessor-in-interest, Rafael Reyes, Jr.
The foregoing claim is not supported by the rollo of G.R. No. 92811, which reveals
the following: (a) On 18 September 1990, petitioners therein, represented by De
Lara, De Lunas and Rosales, who are the lawyers of petitioners in the instant case,

filed a motion for the reconsideration of the resolution of 20 August 1990. 19 b) This
motion was denied in the resolution of 1 October 1990. 20 c) On 17 November 1990,
petitioners therein, through the same lawyers, filed a Motion For Leave Of Court To
Refer Case To The Honorable Supreme Court En Banc And/Or Motion For
Reconsideration 21 wherein they specifically admit that said case and the instant
petition have "identity and/or similarity of the parties, the facts, the issues raised,"
even going to the extent of "graphically" illustrating where such similarities lie. 22d)
This motion was denied in the resolution of 28 November 1990. Copy thereof was
furnished the attorneys for petitioners.23 e) Entry of judgment had already been
made therein and a copy thereof was sent to petitioner's counsel per Letter of
Transmittal of the Deputy Court and Chief of the Judicial Records Office dated 20
December 1990.
What comes out prominently from the disquisitions of the parties is this simple
issue: whether or not respondent Court of Appeals committed any reversible error
in setting aside the decision of the trial court.
We find none. The reversal of the trial court's decision is inevitable and unavoidable
because the legal and factual conclusions made by the trial court are unfounded and
clearly erroneous. The Court of Appeals was not bound to agree to such conclusions.
The trial court erred in holding that: (a) there was no partition among the children
of Gavino Reyes in 1936 since there is no written evidence in support thereof; yet, it
admits that there was a survey and subdivision of the property and the adjudication
of specific subdivision lots to each of the children of Gavino; (b) the land sold by
Rafael Reyes, Sr. to private respondents is not identical to Lot No. 1-A-14, the lot
specified for and adjudicated to Rafael Reyes, Jr. in the partition agreement; and (c)
if the land sold by Rafael Reyes, Sr. to private respondent Dalmacio Gardiola is
indeed Lot No. 1-A-14 and that TCT No. T-27257 was obtained through fraud, the
remedy open to the vendee was an action for reconveyance, which should have
been brought within four (4) years from the discovery thereof in 1967 when the
Extrajudicial Settlement was executed since private respondent Rosario Martillano,
wife of Dalmacio, was a party thereto.
The Court of Appeals correctly held that the partition made by the children of
Gavino Reyes in 1936, although oral, was valid and binding. There is no law that
requires partition among heirs to be in writing to be valid. 24 InHernandez vs. Andal,
supra, this Court, interpreting Section 1 of Rule 74 of the Rules of Court, held that
the requirement that a partition be put in a public document and registered has for
its purpose the protection of creditors and at the same time the protection of the
heirs themselves against tardy claims. The object of registration is to serve as
constructive notice to others. It follows then that the intrinsic validity of partition
not executed with the prescribed formalities does not come into play when there are
no creditors or the rights of creditors are not affected. Where no such rights are
involved, it is competent for the heirs of an estate to enter into an agreement for
distribution in a manner and upon a plan different from those provided by law.
There is nothing in said section from which it can be inferred that a writing or other
formality is an essential requisite to the validity of the partition. Accordingly, an oral
partition is valid.

15

Barcelona, et al. vs. Barcelona, et al., supra, provides the reason why oral partition
is valid and why it is not covered by the Statute of Frauds: partition among heirs or
renunciation of an inheritance by some of them is not exactly a conveyance of real
property for the reason that it does not involve transfer of property from one to the
other, but rather a confirmation or ratification of title or right of property by the heir
renouncing in favor of another heir accepting and receiving the inheritance.
Additionally, the validity of such oral partition in 1936 has been expressly sustained
by this Court in the Resolution of 20 August 1990 in G.R. No. 92811. 25
But even if We are to assume arguendo that the oral partition executed in 1936 was
not valid for some reason or another, We would still arrive at the same conclusion
for upon the death of Gavino Reyes in 1921, his heirs automatically became coowners of his 70-hectare parcel of land. The rights to the succession are transmitted
from the moment of death of the decedent. 26 The estate of the decedent would
then be held in co-ownership by the heirs. The co-heir or co-owner may validly
dispose of his share or interest in the property subject to the condition that the
portion disposed of is eventually allotted to him in the division upon termination of
the co-ownership. Article 493 of the Civil Code provides:
Each co-owner shall have the full ownership of his part and the
fruits and benefits pertaining thereto, and he may 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.
In Ramirez vs. Bautista, 27 this Court held that 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.
In the case at bar, the lot sold by Rafael Reyes, Sr. to private respondent Dalmacio
Gardiola is his share in the estate of his deceased father, Gavino Reyes. It is the
same property which was eventually adjudicated to his son and heir, Rafael Reyes,
Jr., represented in turn by his heirs-petitioners herein-in the extrajudicial settlement
of 1967.
In respect to the issue as to whether the property sold by Rafael Reyes, Sr. is
identical to Lot No. 1-14-A, the trial court based its conclusion that it is not, on his
observation that the description of the former does not tally with that of the latter,
moreover, if Rafael did intend to sell Lot No. 1-14-A, he should have specifically
stated it in the deed since at that time, the property had already been partitioned
and said lot was adjudicated to him. In addition to the contrary findings and
conclusion of the respondent Court on this issue to which We fully agree, it is to be

stressed that Rafael had this property declared for taxation purposes and the tax
declaration issued was made the basis for the description of the property in the
deed of sale. Upon the execution of the deed of sale, vendee herein private
respondent Dalmacio Gardiola immediately took possession of the property. This
is the very same property which is the subject matter of this case and which
petitioners seek to recover from the private respondents. The main evidence
adduced for their claim of ownership and possession over it is TCT No. T-27257, the
certificate of title covering Lot No. 1-14-A. They therefore admit and concede that
the property claimed by private respondent, which was acquired by sale from Rafael
Reyes, Sr., is none other than Lot No. 1-14-A.
The participation of private respondent Rosario Gardiola in the Extrajudicial
Settlement did not place private respondents in estoppel to question the issuance of
TCT No. T-27257. As correctly maintained by private respondents, she signed it in
representation of her deceased mother, Marta Reyes, a daughter and an heir of
Gavino Reyes. She did not sign for and in behalf of her husband, Dalmacio Gardiola,
vendee of the share of Rafael Reyes, Sr.
The same did not operate to divest the vendee of the share of Rafael Reyes, Sr. in
the estate of Gavino. Petitioners, as mere successors-in-interest of Rafael Reyes, Jr.,
son of Rafael Reyes, Sr., can only acquire that which Rafael, Jr. could transmit to
them upon his death. The latter never became the owner of Lot No. 1-A-14 because
it was sold by his father in 1943. The issuance of TCT No. T-27257 in the name of
Rafael Reyes, Jr., in so far as Lot No. 1-14-A is concerned, was clearly erroneous
because he never became its owner. An extrajudicial settlement does not create a
light in favor of an heir. As this Court stated in the Barcelona case, 28 it is but a
confirmation or ratification of title or right to property. Thus, since he never had any
title or right to Lot No. 1-14-A, the mere execution of the settlement did not
improve his condition, and the subsequent registration of the deed did not create
any right or vest any title over the property in favor of the petitioners as heirs of
Rafael Reyes, Jr. The latter cannot give them what he never had before. Nemo dare
potest quod non habet.
There is one more point that should be stressed here. Petitioners' immediate
predecessor-in-interest, Rafael Reyes, Jr., never took any action against private
respondents from the time his father sold the lot to the latter. Neither did petitioners
bring any action to recover from private respondents the ownership and possession
of the lot from the time Rafael Reyes, Jr. died. As categorically admitted by
petitioners in their complaint and amended complaint, it was only in or about
September 1969 when, after the delivery of TCT No. 27257 by Candido Hebron to
them, that they definitely discovered that they were the owners of the property in
question. And yet, despite full knowledge that private respondents were in actual
physical possession of the property, it was only about thirteen and one-half (13 1/2)
years later that they decided to file an action for recovery of possession. As stated
earlier, the original complaint was filed in the trial court on 14 March 1983. There
was then absolutely no basis for the trial court to place the burden on private
respondents to bring an action for reconveyance within four (4) years from their

16

discovery of the issuance of the transfer certificate of title in the name of Rafael
Reyes, Jr.
The instant petition then is without merit.
WHEREFORE, judgment is hereby rendered DENYING the petition with costs against
petitioners.
Republic of the Philippines
Supreme Court
Manila

SO ORDERED.

THIRD DIVISION
SPOUSES GORGONIO BENATIRO
and COLUMBA CUYOS-BENATIRO
substituted by their heirs, namely:
Isabelita, Renato, Rosadelia and
Gorgonio, Jr., surnamed Benatiro, and
SPOUSES RENATO C. BENATIRO and
ROSIE M. BENATIRO,
Respondents,
- versus HEIRS OF EVARISTO CUYOS,
namely: Gloria Cuyos-Talian,
Patrocenia Cuyos-Mijares,
Numeriano Cuyos, and Enrique Cuyos,
represented by their attorney-in-fact,
Salud Cuyos,

G.R. No. 161220

Present:
YNARES-SANTIAGO,
Chairperson,
AUSTRIA-MARTINEZ,
CHICO-NAZARIO
NACHURA, and
REYES, JJ.

Promulgated:
Respondents.
July 30, 2008
x----------------------------------------------------------x
DECISION
AUSTRIA-MARTINEZ, J.:
Before us is a Petition for Review on Certiorari under Rule 45 of the Rules of Court
filed by petitioners seeking to annul the Decision [1] dated July 18, 2003 of the Court of Appeals
(CA) and its Resolution[2] dated November 13, 2003 denying petitioners motion for
reconsideration issued in CA-G.R. SP No. 65630.[3]
Spouses Evaristo Cuyos and Agatona Arrogante Cuyos were blessed with nine
children, namely: Francisco, Victoria, Columba, Lope, Salud, Gloria, Patrocenia, Numeriano, and
Enrique. OnAugust 28, 1966, Evaristo died leaving six parcels of land located
in Tapilon, Daanbantayan, Cebu covered by Tax Declaration (TD) Nos. 000725, 000728, 000729,
000730, 000731, 000732, all under the name of Agatona Arrogante.
On July 13, 1971, one of the heirs, Gloria Cuyos-Talian (respondent Gloria)
represented by Atty. Victor Elliot Lepiten (Atty. Lepiten), filed before the Court of First Instance

17

(CFI) now Regional Trial Court (RTC), Cebu, Branch XI, a petition[4] for Letters of
Administration, docketed as Special Proceeding (SP) No. 24-BN entitled In the Matter of the
Intestate Estate of EvaristoCuyos, Gloria Cuyos-Talian, petitioner. The petition was opposed by
Glorias brother, Francisco, who was represented by Atty. Jesus Yray (Atty. Yray).
In the hearing held on January 30, 1973, both parties together with their respective
counsels appeared. Both counsels manifested that the parties had come to an agreement to
settle their case. The trial court on even date issued an Order [5] appointing Gloria
as administratrix of the estate. The dispositive portion reads:
WHEREFORE, letters of administration of the estate of the
late Evaristo Cuyos and including the undivided half accruing to his
spouse Agatona Arrogante who recently died is hereby issued in favor of
Mrs. Gloria Cuyos Talian who may qualify as such administratrix after
posting a nominal bond of P1,000.00.[6]
Subsequently, in the Order[7] dated December 12, 1975, the CFI stated that when
the Intestate Estate hearing was called on that date, respondent Gloria and her
brother, oppositorFrancisco, together with their respective counsels, appeared; that Atty. Yray,
Franciscos counsel, manifested that the parties had come to an agreement to settle the case
amicably; that both counsels suggested that the Clerk of Court, Atty. Andres
C. Taneo (Atty. Taneo), be appointed to act as Commissioner to effect the agreement of the
parties and to prepare the project of partition for the approval of the court. In the same Order,
the Court of First Instance (CFI) appointed Atty. Taneo and ordered him to make a project of
partition within 30 days from December 12, 1975 for submission and approval of the court.
In his Commissioner's Report[8] dated July 29, 1976, Atty. Taneo stated that he
issued subpoenae supplemented by telegrams to all the heirs to cause their appearance on
February 28 and 29, 1976 in Tapilon, Daanbantayan, Cebu, where the properties are
located, for a conference or meeting to arrive at an agreement; that out of the nine heirs, only
respondents Gloria, Salud and Enrique Cuyos failed to attend; that per return of the service,
these three heirs could not be located in their respective given addresses; that since some of
the heirs present resided outside the province of Cebu, they decided to go ahead with the
scheduled meeting.
Atty. Taneo declared in his Report that the heirs who were present:

condition that should any of the heirs would be in a position to buy the
properties of the estate, the rest of the eight (8) heirs will just receive
only Four Thousand Pesos (P4,000.00) each.
5.

Agreed to equally divide the administration expenses to be

deducted from their respective share of P4,000.00.[9]

The Report further stated that Columba Cuyos-Benatiro (Columba), one of the heirs,
informed all those present in the conference of her desire to buy the properties of the estate, to
which everybody present agreed, and considered her the buyer. Atty. Taneo explained that the
delay in the submission of the Report was due to the request of respondent Gloria that she be
given enough time to make some consultations on what was already agreed upon
by the majority of the heirs; that it was only on July 11, 1976 that the letter of respondent
Gloria was handed to Atty. Taneo,with the information that respondent Gloria was amenable to
what had been agreed upon, provided she be given the sum of P5,570.00 as her share of the
estate, since one of properties of the estate was mortgaged to her in order to defray their
father's hospitalization.
Quoting
the
Commissioners
Report, the
CFI
issued the assailed
Order[10] dated December 16, 1976, the dispositive portion of which reads as follows:
WHEREFORE, finding the terms and conditions agreed upon by the heirs to
be in order, the same being not contrary to law, said compromise
agreement as embodied in the report of the commissioner is hereby
approved. The Court hereby orders the Administratrix to execute the deed
of sale covering all the properties of the estate in favor
of Columba Cuyos Benatiro after the payment to her of the sum
of P36,000.00. The said sum of money shall remain in custodia legis, but
after all the claims and administration expenses and the estate taxes shall
have been paid for, the remainder shall, upon order of the Court, be divided
equally among the heirs. [11]
The CFI disapproved the claim of respondent Gloria for the sum of P5,570.00, as the
same had been allegedly disregarded by the heirs present during the conference.

1.

Agreed to consider all income of the properties of the estate

during the time that Francisco Cuyos, one of the heirs, was
administering the properties of the estate (without appointment from
the Court) as having been properly and duly accounted for.

In an Order[12] dated January 11, 1978, the CFI appointed Lope Cuyos (Cuyos) as
the new administrator of the estate, purportedly on the basis of the motion to relieve
respondent Gloria,as it appeared that she was already residing in Central Luzon and her
absence was detrimental to the early termination of the proceedings.

2.

Agreed to consider all income of the properties of the estate

during the administration of Gloria Cuyos Talian, (duly appointed by
the Court) also one of the heirs as having been properly and duly
accounted for.

On May 25, 1979, administrator Cuyos executed a Deed of Absolute Sale[13] over the
six parcels of land constituting the intestate estate of the late Evaristo Cuyos in favor
of Columba for a consideration of the sum of P36,000.00.

3.

Agreed
to
consider
all
motions
filed
in this
proceedings demanding an accounting from Francisco Cuyos and
Gloria Cuyos Talian, as having been withdrawn.

4.

Agreed not to partition the properties of the estate but instead

agreed to first sell it for the sum of P40,000.00 subject to the

Sometime in February 1998, the heirs of Evaristo Cuyos, namely: Gloria CuyosTalian, Patrocenia Cuyos-Mijares, Numeriano Cuyos and Enrique Cuyos, represented by their
attorney-in-fact, Salud Cuyos (respondents), allegedly learned that Tax Declaration Nos.
000725, 000728, 000729, 000730, 000731 and 000732, which were all in the name of their
late mother AgatonaArrogante, were canceled and new Tax Declaration Nos., namely, 2014129, 20-14130, 20-141131, 20-14132, 2014133 and 20-14134, were issued
in Columbas name; and that later on, Original Certificates of Titles covering the estate

18

of Evaristo Cuyos were issued in favor of Columba; that some of these parcels of land were
subsequently transferred to the names of spouses Renato C.Benatiro and Rosie M. Benatiro,
son and daughter-in-law, respectively, of petitioners Gorgonio and Columba, for which transfer
certificates of title were subsequently issued; that they subsequently discovered the existence
of the assailed CFI Order dated December 16, 1976 and the Deed of Absolute Sale dated May
25, 1979.
Respondents filed a complaint against petitioner Gorgonio Benatiro before the
Commission on the Settlement of Land Problems (COSLAP) of the Department of Justice, which
on June 13, 2000 dismissed the case for lack of jurisdiction.[14]
Salud Cuyos brought
the
matter
the barangay level, but was unsuccessful.[15]

for

conciliation

and

mediation

at

On July 16, 2001, Salud Cuyos, for herself and in representation[16] of the other heirs
of Evaristo Cuyos, namely: Gloria, Patrocenia, Numeriano,[17] and Enrique, filed with the CA a
petition for annulment of the Order dated December 16, 1976 of the CFI of Cebu, Branch XI, in
SP No. 24-BN under Rule 47 of the Rules of Court. They alleged that the CFI Order dated
December 16, 1976 was null and void and of no effect, the same being based on a
Commissioner's Report, which was patently false and irregular; that such report practically
deprived them of due process in claiming their share of their father's estate;
that Patrocenia Cuyos-Mijares executed an affidavit, as well as the unnotarized statement of
Gloria stating that no meeting ever took place for the purpose of discussing how to
dispose of the estate of their parents and that they never received any payment from
the supposed sale of their share in the inheritance; that the report was done in close
confederacy with their co-heir Columba, who stood to be benefited by the Commissioner's
recommendation, should the same be approved by the probate court; that since the report was
a falsity, any order proceeding therefrom was invalid; that the issuance of the certificates of
titles in favor of respondents were tainted with fraud and irregularity, since the CFI which issued
the assailed order did not appear to have been furnished a copy of the Deed of Absolute Sale;
that the CFI was not in custodia legis of the consideration of the sale, as directed in its Order so
that it could divide the remainder of the consideration equally among the heirs after paying all
the administration expenses and estate taxes; that the intestate case had not yet been
terminated as the last order found relative to the case was the appointment of Lope as
administrator vice Gloria; that they never received their corresponding share in the inheritance;
and that the act of petitioners in manifest connivance with administrator Lope amounted to a
denial of their right to the property without due process of law, thus, clearly showing that
extrinsic fraud caused them to be deprived of their property.
Herein petitioners contend that respondents' allegation that they discovered the
assailed order dated December 16, 1976 only in February 1998 was preposterous, as
respondents were represented by counsel in the intestate proceedings; thus, notice of Order to
counsel was notice to client; that this was only a ploy so that they could claim that they filed the
petition for annulment within the statutory period of four (4) years; that they have been in
possession of the six parcels of land since May 25, 1979 when the same was sold to them
pursuant to the assailed Order in the intestate proceedings; that no extrinsic fraud attended the
issuance of the assailed order; that Numeriano executed an affidavit in which he
attested to having received his share of the sale proceeds on May 18, 1988; that respondents
were estopped from assailing the Order dated December 16, 1976, as it had already attained
the status of finality.

On July 18, 2003, the CA granted the petition and annulled the CFI order,
the dispositive portion of which reads:
FOR ALL THE FOREGOING REASONS, the instant petition is
hereby GRANTED. Accordingly, the Order issued by the Court of First
Instance of Cebu Branch XI dated December 16, 1976 as well as the
Certificates of Title issued in the name of Columba Cuyos-Benatiro and the
subsequent transfer of these Titles in the name of spouses Renato and
Rosie Benatiro are hereby ANNULLED and SET ASIDE. Further, SP Proc.
Case No. 24-BN is hereby ordered reopened and proceedings thereon be
continued.[18]
The CA declared that the ultimate fact that was needed to be established was the
veracity and truthfulness of the Commissioners Report, which was used by the trial court as its
basis for issuing the assailed Order. The CA held that to arrive at an agreement, there was a
need for all the concerned parties to be present in the conference; however, such was not the
scenario since in their separate sworn statements, the compulsory heirs of the decedent attested
to the fact that no meeting or conference ever happened among them; that although under
Section 3(m), Rule 133 on the Rules of Evidence, there is a presumption of regularity in the
performance of an official duty, the same may be contradicted and overcome by other evidence to
prove the contrary.
The CA noted some particulars that led it to conclude that the conference was not held
accordingly, to wit: (1) the Commissioners Report never mentioned the names of the heirs who
were present in the alleged conference but only the names of those who were absent, when the
names of those who were present were equally essential, if not even more important, than the
names of those who were absent; (2) the Report also failed to include any proof of conformity to
the agreement from the attendees, such as letting them sign the report to signify their consent as
regards the agreed mechanisms for the estates settlement; (3) there was lack or absence of
physical evidence attached to the report indicating that the respondents were indeed properly
notified about the scheduled conference. The CA then concluded that due to the absence of the
respondents' consent, the legal existence of the compromise agreement did not stand on a firm
ground.
The CA further observed that although it appeared that notice of the report was given to
Atty. Lepiten and Atty. Yray, lawyers of Gloria and Francisco Cuyos, respectively, the same cannot
be taken as notice to the other heirs of Evaristo Cuyos; that a lawyers authority to compromise
cannot be simply presumed, since what was required was the special authority to compromise on
behalf of his client; that a compromise agreement entered into by a person not duly authorized to
do so by the principal is void and has no legal effect, citing Quiban v. Butalid;[19] that being a void
compromise agreement, the assailed Order had no legal effect.
Thus, the CA ruled that the Certificates of Titles obtained by herein petitioners were
procured fraudulently; that the initial transfer of the properties to Columba Cuyos-Benatiro by
virtue of a Deed of Absolute Sale executed by Lope Cuyos was clearly defective, since the
compromise agreement which served as the basis of the Deed of Absolute Sale was void and had
no legal effect.
The CA elaborated that there was no showing that Columba paid the sum
of P36,000.00 to the administrator as consideration for the sale, except for the testimony
of Numeriano Cuyosadmitting that he received his share of the proceeds but without indicating
the exact amount that he received; that even so, such alleged payment was incomplete and
was not in compliance with the trial courts order for the administratix to execute the deed of

19

sale covering all properties of the estate in favor of Columba Cuyos-Benatiro after the payment
to the administratrix of the sum ofP36,000.00; that said sum of money shall remain
in custodia legis, but after all the claims and administration expenses and the estate taxes shall
have been paid for, the remainder shall, upon order of the Court, be divided equally among the
heirs.
Moreover, the CA found that the copy of the Deed of Sale was not even furnished the
trial court nor was said money placed under custodia legis as agreed upon; that the
Certification dated December 9, 1998 issued by the Clerk of Court of Cebu indicated that the
case had not yet been terminated and that the last Order in the special proceeding was the
appointment of Lope Cuyos as the new administrator of the estate; thus, the transfer of the
parcels of land, which included the execution of the Deed of Absolute Sale, cancellation of Tax
Declarations and the issuance of new Tax Declarations and Transfer Certificates of Title, all in
favor of petitioners, were tainted with fraud. Consequently, the CA concluded that the
compromise agreement, the certificates of title and the transfers made by petitioners through
fraud cannot be made a legal basis of their ownership over the properties, since to do so would
result in enriching them at the expense of the respondents; and that it was also evident that
the fraud attendant in this case was one of extrinsic fraud, since respondents were denied the
opportunity to fully litigate their case because of the scheme utilized by petitioners to assert
their claim.
Hence, herein petition raising the following issues:
Whether or not annulment of order under Rule 47 of the Rules of
Court was a proper remedy where the aggrieved party had other
appropriate remedies, such as new trial, appeal, or petition for relief, which
they failed to take through their own fault.
Whether or not the Court of Appeals misapprehended the facts
when it annulled the 24 year old Commissioner's Report of the Clerk of
Court - an official act which enjoys a strong presumption of regularity based merely on belated allegations of irregularities in the performance of
said official act.
Whether or not upon the facts as found by the Court of Appeals
in this case, extrinsic fraud existed which is a sufficient ground to annul the
lower court's order under Rule 47 of the Rules of Court. [20]
Subsequent to the filing of their petition, petitioners filed a Manifestation that they
were in possession of affidavits of waiver and desistance executed by the heirs of
Lope Cuyos[21] and
respondent Patrocenia Cuyos-Mijares[22] on February
17,
2004 and December 17, 2004, respectively. In both affidavits, the affiants stated that they
had no more interest in prosecuting/defending the case involving the settlement of the
estate, since the subject estate properties had been bought by their late sister Columba, and
they had already received their share of the purchase price.Another heir,
respondent Numeriano Cuyos, had also earlier executed an Affidavit [23] dated December 13,
2001, stating that the subject estate was sold to Columba and that she had already received
her share of the purchase price on May 18, 1988. In addition, Numeriano had issued a
certification[24] dated May 18, 1988, which was not refuted by any of the parties, that he had
already received P4,000.00 in payment of his share, which could be the reason why he refused
to sign the Special Power of Attorney supposedly in favor of Salud Cuyos for the filing of the
petition with the CA.

The issue for resolution is whether the CA committed a reversible error in annulling
the CFI Order dated December 16, 1976, which approved the Commissioners Report
embodying the alleged compromise agreement entered into by the heirs
of Evaristo and Agatona Arrogante Cuyos.
We rule in the negative.
The remedy of annulment of judgment is extraordinary in character [25] and will not so
easily and readily lend itself to abuse by parties aggrieved by final judgments. Sections 1 and 2 of
Rule 47 impose strict conditions for recourse to it, viz.:
Section 1. Coverage. This Rule shall govern the annulment by
the Court of Appeals of judgments or final orders and resolutions in civil
actions of Regional Trial Courts for which the ordinary remedies of new trial,
appeal, petition for relief or other appropriate remedies are no longer
available through no fault of the petitioner.
Section 2. Grounds for annulment. The annulment may be
based only on the grounds of extrinsic fraud and lack of jurisdiction.
Extrinsic fraud shall not be a valid ground if it was availed of, or
could have been availed of, in a motion for new trial or petition for relief.
Although Section 2 of Rule 47 of the Rules of Court provides that annulment of a final
judgment or order of an RTC may be based "only on the grounds of extrinsic fraud and lack of
jurisdiction," jurisprudence recognizes denial of due process as additional .ground therefor.[26]
An action to annul a final judgment on the ground of fraud will lie only if the fraud is
extrinsic or collateral in character.[27] Extrinsic fraud exists when there is a fraudulent act
committed by the prevailing party outside of the trial of the case, whereby the defeated party was
prevented from presenting fully his side of the case by fraud or deception practiced on him by the
prevailing party.[28] Fraud is regarded as extrinsic where it prevents a party from having a trial or
from presenting his entire case to the court, or where it operates upon matters pertaining not to
the judgment itself but to the manner in which it is procured. The overriding consideration when
extrinsic fraud is alleged is that the fraudulent scheme of the prevailing litigant prevented a party
from having his day in court.[29]
While we find that the CA correctly annulled the CFI Order dated December 16, 1976,
we find that it should be annulled not on the ground of extrinsic fraud, as there is no sufficient
evidence to hold Atty. Taneo or any of the heirs guilty of fraud, but on the ground that the
assailed order is void for lack of due process.
Clerk of Court Taneo was appointed to act as Commissioner to effect the agreement of
the heirs and to prepare the project of partition for submission and approval of the court. Thus, it
was incumbent upon Atty. Taneo to set a time and place for the first meeting of the heirs. In his
Commissioners Report, Atty. Taneo stated that he caused the appearance of all the heirs
of Evaristo Cuyosand Agatona Arrogante Cuyos in the place, where the subject properties were
located for settlement, by sending them subpoenae supplemented by telegrams for them to
attend the conference scheduled on February 28 to 29, 1976. It was also alleged that out of the
nine heirs, only six attended the conference; however, as the CA aptly found, the Commissioner
did not state the names of those present, but only those heirs who failed to attend the
conference, namely: respondents Gloria, Salud and Enrique who, as stated in the Report, based
on the return of service, could not be located in their respective given addresses.

20

However, there is nothing in the records that would establish that the
alleged subpoenae, supplemented by telegrams, for the heirs to appear in the scheduled
conference were indeed sent to the heirs. In fact, respondent Patrocenia Cuyos-Mijares, one of
the heirs, who was presumably present in the conference, as she was not mentioned as among
those absent, had executed an affidavit [30]dated December 8, 1998 attesting, to the fact that she
was not called to a meeting nor was there any telegram or notice of any meeting received by
her. While Patrocenia had executed on December 17, 2004 an Affidavit of Waiver and
Desistance[31] regarding this case, it was only for the reason that the subject estate properties had
been bought by their late sister Columba, and that she had already received her corresponding
share of the purchase price, but there was nothing in the affidavit that retracted her previous
statement that she was not called to a meeting. Respondent Gloria also made
an unnotarized statement[32] that there was no meeting held. Thus, the veracity
of Atty. Taneos holding of a conference with the heirs was doubtful.
Moreover, there was no evidence showing that the heirs indeed convened for the
purpose of arriving at an agreement regarding the estate properties, since they were not even
required to sign anything to show their attendance of the alleged meeting. In fact, the
Commissioner's Report, which embodied the alleged agreement of the heirs, did not bear the
signatures of the alleged attendees to show their consent and conformity thereto.
It bears stressing that the purpose of the conference was for the heirs to arrive at a
compromise agreement over the estate of Evaristo Cuyos. Thus, it was imperative that all the
heirs must be present in the conference and be heard to afford them the opportunity to protect
their interests. Considering that no separate instrument of conveyance was executed among the
heirs embodying their alleged agreement, it was necessary that the Report be signed by the heirs
to prove that a conference among the heirs was indeed held, and that they conformed to the
agreement stated in the Report.
Petitioners point out that the Commissioner was an officer of the court and a
disinterested party and that, under Rule 133, Section 3(m) of the Rules on Evidence, there is a
presumption that official duty has been regularly performed.
While, under the general rule, it is to be presumed that everything done by an officer in
connection with the performance of an official act in the line of his duty was legally done, such
presumption may be overcome by evidence to the contrary. We find the instances mentioned by
the CA, such as absence of the names of the persons present in the conference, absence of the
signatures of the heirs in the Commissioner's Report, as well as absence of evidence showing that
respondents were notified of the conference, to be competent proofs of irregularity that rebut the
presumption.
Thus, we find no reversible error committed by the CA in ruling that the conference was
not held accordingly and in annulling the assailed order of the CFI.
Petitioners attached a Certification [33] dated August 7, 2003 issued by the Officer In
Charge (OIC), Branch Clerk of Court of the RTC, Branch 11, to show that copies of the
Commissioners Report were sent to all the heirs, except Salud and Enrique, as well
as to Attys. Lepiten and Yray as enumerated in the Notice found at the lower portion of the
Report with the accompanying registry receipts.[34]
In Cua v. Vargas,[35] in which the issue was whether heirs were deemed constructively
notified of and bound by an extra-judicial settlement and partition of the estate, regardless of their

failure to participate therein, when the extra-judicial settlement and partition has been duly
published, we held:
The procedure outlined in Section 1 of Rule 74 is an
ex parte proceeding. The rule plainly states, however, that
persons who do not participate or had no notice of an extrajudicial
settlement will not be bound thereby. It contemplates a notice
that has been sent out or issued before any deed of settlement
and/or partition is agreed upon (i.e., a notice calling all interested
parties to participate in the said deed of extrajudicial settlement
and partition), and not after such an agreement has already been
executed as what happened in the instant case with the
publication of the first deed of extrajudicial settlement among
heirs.
The publication of the settlement does not constitute constructive
notice to the heirs who had no knowledge or did not take part in it because
the same was notice after the fact of execution. The requirement of
publication is geared for the protection of creditors and was never intended
to deprive heirs of their lawful participation in the decedent's estate. In this
connection, the records of the present case confirm that respondents never
signed either of the settlement documents, having discovered their
existence only shortly before the filing of the present complaint. Following
Rule 74, these extrajudicial settlements do not bind respondents, and the
partition made without their knowledge and consent is invalid insofar as
they are concerned[36] (Emphasis supplied)
Applying the above-mentioned case by analogy, what matters is whether the heirs
were indeed notified before the compromise agreement was arrived at, which was not
established, and not whether they were notified of the Commissioner's Report embodying the
alleged agreement afterwards.
We also find nothing in the records that would show that the heirs were called to a
hearing to validate the Report. The CFI adopted and approved the Report despite the absence
of the signatures of all the heirs showing conformity thereto. The CFI adopted the Report
despite the statement therein that only six out of the nine heirs attended the conference,
thus, effectively depriving the other heirs of their chance to be heard. The CFI's action was
tantamount to a violation of the constitutional guarantee that no person shall be deprived of
property without due process of law. We find that the assailed Order dated December 16,
1976, which approved a void Commissioner's Report, is a void judgment for lack of due process.
We are not persuaded by petitioners contentions that all the parties in the intestate
estate proceedings in the trial court were duly represented by respective counsels,
namely, Atty. Lepitenfor petitioners-heirs and Atty. Yray for the oppositors-heirs; that when the
heirs agreed to settle the case amicably, they manifested such intention through their
lawyers, as stated in the Order dated January 30, 1973; that an heir in the settlement of the
estate of a deceased person need not hire his own lawyer, because his interest in the estate is
represented by the judicial administrator who retains the services of a counsel; that a judicial
administrator is the legal representative not only of the estate but also of the heirs,
legatees, and creditors whose interest he represents; that when the trial court issued the
assailed Order dated December 16, 1976 approving the Commissioner's Report, the parties
lawyers were duly served said copies of the Order on December 21, 1976 as shown by the
Certification[37] dated August 7, 2003 of the RTC OIC, Clerk of Court; that notices to lawyers

21

should be considered notices to the clients, since, if a party is represented by counsel, service
of notices of orders and pleadings shall be made upon the lawyer; that upon receipt of such
order by counsels, any one of the respondents could have taken the appropriate remedy such
as amotion for reconsideration, a motion for new trial or a petition for relief under Rule 38 at
the proper time, but they failed to do so without giving any cogent reason for such failure.
While the trial court's order approving the Commissioners Report was received by
Attys. Yray and Lepiten, they were the lawyers of Gloria and Francisco, respectively, but not the
lawyers of the other heirs. As can be seen from the pleadings filed before the probate court,
Atty. Lepiten was Glorias counsel when she filed her Petition for letters of administration, while
Atty. Yray was Franciscos lawyer when he filed his opposition to the petition for letters of
administration and his Motion to Order administrarix Gloria to render an accounting and for the
partition of the estate.Thus, the other heirs who were not represented by counsel were not
given any notice of the judgment approving the compromise. It was only sometime in February
1998 that respondents learned that the tax declarations covering the parcels of land, which
were all in the name of their late mother Agatona Arrogante, were canceled; and new Tax
Declarations were issued in Columbas name,and Original Certificates of Titles were
subsequently issued in favor of Columba. Thus, they could not have taken an appeal or other
remedies.
Considering that the assailed Order is a void judgment for lack of due process of law,
it is no judgment at all. It cannot be the source of any right or of any obligation.[38]
In Nazareno v. Court of Appeals,[39] we stated the consequences of a void judgment,
thus:
A void judgment never acquires finality. Hence, while
admittedly, the petitioner in the case at bar failed to appeal timely the
aforementioned decision of the Municipal Trial Court of Naic, Cavite, it
cannot be deemed to have become final and executory. In contemplation
of law, that void decision is deemed non-existent. Thus, there was no
effective or operative judgment to appeal from. In Metropolitan Waterworks
& Sewerage System vs. Sison, this Court held that:
x x x [A] void judgment is not entitled to the respect accorded to
a valid judgment, but may be entirely disregarded or declared inoperative
by any tribunal in which effect is sought to be given to it. It is attended by
none of the consequences of a valid adjudication. It has no legal or binding
effect or efficacy for any purpose or at any place. It cannot affect, impair or
create rights. It is not entitled to enforcement and is, ordinarily, no
protection to those who seek to enforce. All proceedings founded on the
void judgment are themselves regarded as invalid. In other words, a void
judgment is regarded as a nullity, and the situation is the same as it would
be if there were no judgment. It, accordingly, leaves the parties litigants in
the same position they were in before the trial.
Thus, a void judgment is no judgment at all. It cannot be the
source of any right nor of any obligation. All acts performed pursuant to it
and all claims emanating from it have no legal effect. Hence, it can never
become final and any writ of execution based on it is void: "x x x it may be
said to be a lawless thing which can be treated as an outlaw and slain at

sight, or ignored wherever and whenever it exhibits its head.[40] (Emphasis

supplied)
The CFI's order being null and void, it may be assailed anytime, collaterally or in a
direct action or by resisting such judgment or final order in any action or proceeding whenever
it is invoked, unless barred by laches.[41] Consequently, the compromise agreement and the
Order approving it must be declared null and void and set aside.
We find no merit in petitioners' claim that respondents are barred from assailing the
judgment after the lapse of 24 years from its finality on ground of laches and estoppel.
Section 3, Rule 47 of the Rules of Court provides that an action for annulment of
judgment based on extrinsic fraud must be filed within four years from its discovery and, if
based on lack of jurisdiction, before it is barred by laches or estoppel.
The principle of laches or "stale demands" ordains that the failure or neglect, for an
unreasonable and unexplained length of time, to do that which by exercising due diligence could or
should have been done earlier, or the negligence or omission to assert a right within a reasonable
time, warrants a presumption that the party entitled to assert it either has abandoned it or
declined to assert it.[42]
There is no absolute rule as to what constitutes laches or staleness of demand; each
case is to be determined according to its particular circumstances. [43] The question of laches is
addressed to the sound discretion of the court and, being an equitable doctrine, its application is
controlled by equitable considerations. It cannot be used to defeat justice or perpetrate fraud and
injustice. It is the better rule that courts, under the principle of equity, will not be guided or bound
strictly by the statute of limitations or the doctrine of laches when to be so, a manifest wrong or
injustice would result.[44]
In this case, respondents learned of the assailed order only sometime in February 1998
and filed the petition for annulment of judgment in 2001. Moreover, we find that respondents'
right to due process is the paramount consideration in annulling the assailed order. It bears
stressing that an action to declare the nullity of a void judgment does not prescribe.[45]
Finally, considering that the assailed CFI judgment is void, it has no legal and binding
effect, force or efficacy for any purpose. In contemplation of law, it is non-existent. Hence, the
execution of the Deed of Sale by Lope in favor of Columba pursuant to said void
judgment, the issuance of titles pursuant to said Deed of Sale, and the subsequent transfers
are void ab initio. No reversible error was thus committed by the CA in annulling the judgment.
WHEREFORE, the petition is DENIED and the Decision dated July 18, 2003 and
Resolution dated November 13, 2003 of the Court of Appeals are AFFIRMED. The Regional
Trial Court, Branch XI, Cebu and the Heirs of Evaristo Cuyos are DIRECTED to proceed with
SP Proceedings Case No. 24-BN for the settlement of the Estate of Evaristo Cuyos.
No costs.
SO ORDERED.

22

Republic of the Philippines

Supreme Court
Manila
SECOND DIVISION
FRANCISCO TAYCO, substituted
TAYCO and NOEL TAYCO,

byLUCRESIA

Petitioners,

G.R. No. 168692

Present:
-versus-

CARPIO, J., Chairperson,

NACHURA,

HEIRS OF CONCEPCION TAYCO-FLORES, namely:

LUCELI F. DIAZ, RONELE F. BESA, MONELE
FLORES, PERLA FLORES, RUPERTO FLORES,
WENCESLAO
FLORES,
PURISIMA
FLORES, andFELIPE FLORES,

PERALTA,
ABAD, and
MENDOZA, JJ.

Respondents.

Promulgated:

23

December 13, 2010

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

3. A parcel of land (Lot 2960), situated at Andagao,

Kalibo, Aklan, with the area of 4,012 square meters, bounded on
the NE by Lot 2957-J; on the SE by Lot 2961-H; on the SW
byLot 2660; and on the NW by Lot 2656, covered by OCT No.
(23813) RO-1563, under ARP/TD No. 01782 in the name of
Diega Regalado with assessed value of P4,820.00.[4]

DECISION

PERALTA, J.:

For this Court's consideration is a petition for review on certiorari[1] under Rule 45 of
the Rules of Court seeking the reversal of the Court of Appeals' Decision [2] dated
November 17, 2004 and the reinstatement of the Regional Trial Court's
Decision[3] dated October 2, 2001.

The records contain the following facts:

Upon the death of the spouses Fortunato Tayco and Diega Regalado, their children,
petitioner Francisco Tayco, Concepcion Tayco-Flores and Consolacion Tayco inherited
the following parcels of land:

1. A parcel of land (Lot 1902pt.), situated at Buswang

New, Kalibo, Aklan with the area of 9,938 square meters,
bounded on the NE by Lots 1848 & 1905; on the SE by Lots 1903
& 1904; on the NW by Lots 1895, 1887, 1890 and 1808, covered
by OCT No. (24360) RO-1569 under ARP/TD No. 01025 in the
name of Diega Regalado with assessed value of P15,210.00;

2. A parcel of land (Lot 1896), situated at Buswang New,

Kalibo, Aklan, with the area of 2,123 square meters, bounded on
the NE by Lot 1898-C; on the SE by Lot 1897; on the SW by New
Provincial Road; and on the NW by Lot 1893, covered by OCT No.
(24101) RO-1570, under ARP/TD No. 01087 & 01088 in the
name of Diega Regalado with assessed value ofP6,910.00; and

Sometime in September of 1972, petitioner Francisco Tayco and his sister

Consolacion Tayco executed a document called Deed of Extrajudicial Settlement of
the Estate of the Deceased Diega Regalado with Confirmation of Sale of Shares,
[5]
transferring their shares on the abovementioned properties to their sister
Concepcion Tayco-Flores. The said document was notarized and, on March 16,
1991, Concepcion Tayco-Flores and Consolacion Tayco executed the Confirmation of
Quitclaim of Shares in Three (3) Parcels of Land.[6]

Consolacion Tayco died on December 25, 1996 and Concepcion Tayco-Flores died
on January 14, 1997. Thereafter, petitioner Francisco Tayco filed a case for nullity of
documents and partition with damages with the RTC of Kalibo, Aklan claiming that
the Deed of Extrajudicial Settlement of the Estate of the Deceased Diega Regalado
with Confirmation of Sale of Shares and the Confirmation of Quitclaim of Shares in
three (3) Parcels of Land are null and void; thus, he is still entitled to his original
shares in the parcels of land. According to him, the Deed of Extrajudicial Settlement
was executed at that time, because Concepcion Tayco-Flores was in need of money
and wanted the properties to be mortgaged in a bank. He claimed that the
mortgage did not push through and that he requested his sister to cancel the said
Deed, to which the latter ensured that the same document had no effect. However,
he further claimed that without his knowledge and consent, her sisters Concepcion
and Consolacion executed another document entitled Confirmation of Quitclaim of
Shares in three (3) Parcels of Land in order to have the tax declarations and
certificates of title covering those three parcels of land transferred in the name
of Concepcion. He also alleged that he came to know of the said facts only when he
had the property surveyed for the purpose of partition and some of the heirs
of Concepcion objected to the said survey.

The RTC ruled in favor of petitioner Francisco Tayco, the dispositive portion of the
decision reads:

WHEREFORE, the Court finds that the preponderance of evidence

tilts in favor of the plaintiff and judgment is hereby rendered:

a) Declaring the document entitled, Extrajudicial

Settlement of the Estate of the Deceased Diega

24

Regalado with Confirmation of Sale of Shares

(Annex A, Complaint), and the document
entitled Confirmation of Quitclaim of Shares in
Three (3) Parcels of Land (Annex B, Complaint),
as null and void;

b) Declaring the three (3) parcels of land subject

of the above documents to be co-owned by the
plaintiff ( share) and defendants ( share);

c) Ordering the parties to submit to the court a

Project of Partition indicating the specific portion
allotted to them within 30 days from receipt of
this decision; in case of disagreement, the Court
shall order the sale of all the three (3) parcels
with the proceeds to be divided equally between
plaintiff on the one hand and the defendants on
the other;

d) Ordering the defendants to pay the plaintiff

the sum of P10,000.00 representing litigation
expenses, and P5,000.00 as attorney's fees,
plus cost.

e) The claim for moral and exemplary damages

are hereby denied.

SO ORDERED.[7]

In ruling that the assailed documents were null and void, the RTC ratiocinated that
the extrajudicial settlement is a simulated document to make it appear that
Concepcion Tayco-Flores was the owner of the properties, so that it would be easy
for her to use the same as a collateral for a prospective loan and as evidence
disclosed that the intended loan with any financial institution did not materialize,
hence, the document had no more effect. Consequently, according to the trial court,
since the first document was simulated and had no force and effect, the second
document had no more purpose and basis.

The respondent-heirs appealed the decision of the RTC to the Court of Appeals, and
on November 17, 2004, the latter reversed the former's ruling, disposing it in the
following manner:

WHEREFORE, in view of the foregoing premises, judgment is

hereby rendered by us REVERSING the assailed decision of the
lower court and a new one entered declaring defendantsappellants absolute owners of Lot Nos. 1902, 1896 and
2620. The complaint of plaintiff-appellee is dismissed.

SO ORDERED.[8]

In reversing the trial court's findings, the CA reasoned out that the genuineness
and due execution of the Extrajudicial Settlement was not disputed and was duly
signed by the parties and notarized. It added that the recital of the provisions of the
said document is clear that it is an extrajudicial settlement of the estate of
deceased Diega Regalado and that petitioner and his sister Consolacion confirmed
the sale of their shares to Concepcion.

Petitioner filed a Motion for Reconsideration,[9] but was denied[10] by the same court.
Thus, the present petition.

The petitioner raised this lone issue:

CAN THE DEED OF EXTRAJUDICIAL SETTLEMENT OF THE ESTATE

OF THE DECEASED DIEGA REGALADO WITH CONFIRMATION
OF SALE OF
SHARES
DIVEST
CO-HEIR
AND
COOWNER FRANCISCO TAYCO OF HIS SHARES IN THE THREE (3)
PARCELS OF LAND IN QUESTION?[11]

Under question is the validity of the document that contains the extrajudicial
settlement of the estate of the deceased, Diega Regalado. The trial court ruled that
it is null and void based on its assessment of the facts, while the CA adjudged it
valid based on its examination of the said document. Under Section 1, Rule 45,
providing for appeals by certioraribefore the Supreme Court, it is clearly enunciated
that only questions of law may be set forth.[12] Questions of fact may not be raised
unless the case falls under any of the following exceptions:[13]

25

(1) when the findings are grounded entirely on speculation,

surmises, or conjectures; (2) when the inference made is
manifestly mistaken, absurd, or impossible; (3) when there is
grave abuse of discretion; (4) when the judgment is based on a
misapprehension of facts; (5) when the findings of fact are
conflicting; (6) when in making its findings the Court of Appeals
went beyond the issues of the case, or its findings are contrary to
the admissions of both the appellant and the appellee; (7) when
the findings are contrary to those of the trial court; (8) when
the findings are conclusions without citation of specific evidence
on which they are based; (9) when the facts set forth in the
petition as well as in the petitioners main and reply briefs are not
disputed by the respondent; and (10) when the findings of fact are
premised on the supposed absence of evidence and contradicted
by the evidence on record.

This case clearly falls under one of the exceptions and after a careful review of the
facts of the case, this Court finds the petition meritorious.

Section 1, Rule 74 of the Rules of Court provides:

If the decedent left no will and no debts and the heirs are all of
age, or the minors are represented by their judicial or legal
representatives duly authorized for the purpose, the parties may,
without securing letters of administration, divide the estate among
themselves as they see fit by means of a public instrument filed in
the office of the register of deeds, and should they disagree, they
may do so in an ordinary action for partition. x x x.

The fact of the extrajudicial settlement or administration shall

be published in a newspaper of general circulation in the
manner provided in the next succeeding section; but
no extrajudicialsettlement shall be binding upon any person who
has not participated therein or had no notice thereof.

xxxx

Notarization of the deed of extrajudicial settlement has the effect of

making it a public document [14] that can bind third parties. However, this formal
requirement appears to be superseded by the substantive provision of the Civil Code
that states:

ART. 1082. Every act which is intended

to put an end to indivision among co-heirs and
legatees or devisees is deemed to be a partition,
although it should purport to be a sale, an
exchange, a compromise, or any other
transaction.

By this provision, it appears that when a co-owner sells his

inchoate right in the co-ownership, he expresses his intention to
put an end to indivision among (his) co-heirs. Partition among coowners may thus be evidenced by the overt act of a co-owner of
renouncing his right over the property regardless of the form it
takes. x x x[15]

The trial court, after a keen determination of the facts involved in the case,
clearly articulated its findings as to the inconclusiveness of the required publication
and the notarization of the document purportedly containing the extrajudicial
settlement in question, thus:

At the outset, the document, Exhibit A, was executed at Lezo,

Aklan which is about ten kilometers from Kalibo where all the
parties are residents. Defendant had to hire a tricycle from Kalibo
to bring the parties to Lezo. Assuming that a certain Engr.
Reynaldo Lopez was helping the defendants at that time in this
transaction, he is also a resident of Kalibo, Aklan which is the
center of Aklan where almost all the lawyers have their
offices. Engr. Lopez has also his office here. Why would he still
recommend the execution of this document particularly in Lezo
and before that particular alleged Notary Public? This sounds
incredible.

Defendants alleged that the document was published in a

newspaper of general circulation of Aklan but no affidavit of such
publication was presented. Only an alleged receipt from Engr.
Lopez was presented (Exh. 2) but does not prove its purpose. [16]

26

The above findings of fact of the trial court must be accorded respect. It is a
hornbook doctrine that the findings of fact of the trial court are entitled to great
weight on appeal and should not be disturbed except for strong and valid reasons,
because the trial court is in a better position to examine the demeanor of the
witnesses while testifying. It is not a function of this Court to analyze and weigh
evidence by the parties all over again.[17]

the pieces of evidence presented, rightfully concluded that the intent of the
signatories was contrary to the questioned document's content and denomination.

Furthermore, the trial court, before stating its final conclusion as to the nullity of the
document in question, correctly discussed the lack of consideration in so far as that
part of the document which embodies the confirmation of the sale of shares of
siblings Francisco and Consolacion to Concepcion. Thus:

Anent the true intent of the signatories of the questioned document appearing to be
an extrajudicial settlement of an estate, the trial court found the following facts:

Plaintiff alleged that Exhibit A was executed just to accommodate

his sister Concepcion Tayco to be able to offer as collateral the
property in order to raise money for the marriage of her son
Ruperto Flores. But the property was never encumbered because
it was then Martial Law (TSN, 10/14/98, pp. 3-4; 5/6/99, pp. 56). This testimony of the plaintiff was never rebutted or denied
by the defendant, Ruperto Flores, who himself testified for the
defendants. In fact, he even admitted that he got married after
the execution of Exhibit A (TSN, 2/16/01, pp. 15-16). This
allegation by the plaintiff, therefore, must stand.

Defendants argue that if their intention was to mortgage the

property in raising money, there was no need for the execution of
Exhibit A but only a Special Power of Attorney would suffice.This
would be the quickest way if the bank would be amenable, but
the latter would be more protected if the title of the property are
already transferred in the name of the mortgagor. For them, it
has only to rely on the certificate of tile if it decides to deal with
it.[18]

An extrajudicial settlement is a contract and it is a well-entrenched doctrine that the

law does not relieve a party from the effects of a contract, entered into with all the
required formalities and with full awareness of what he was doing, simply because
the contract turned out to be a foolish or unwise investment. [19] However, in the
construction or interpretation of an instrument, the intention of the parties is
primordial and is to be pursued.[20] If the terms of a contract are clear and leave no
doubt upon the intention of the contracting parties, the literal meaning of its
stipulations shall control.[21] If the contract appears to be contrary to the evident
intentions of the parties, the latter shall prevail over the former.[22] The
denomination given by the parties in their contract is not conclusive of the nature of
the contents.[23] In this particular case, the trial court, based on its appreciation of

The consideration of P50.00 for a 1/3 share of about

16,000 sq. meters real property in Kalibo, Aklan even way back
in 1972 is definitely way below the market value. Even if we take
into consideration the filial love between siblings (Jocson v. CA,
170 SCRA 233), still, the difference between the market value
then and the purchase price is very great. Even for a market
value of P1,000.00, a consideration of P50.00 only plus filial love
would still be greatly disproportionate. Certainly, the 1/3 share of
plaintiff exceeds P1,000.00. The filial love between siblings
may affect the discrepancy only if the difference between
the market value over the selling price is slight. (ibid.). It
would appear, therefore, that Exhibit A is merely a simulated
document to make it appear that Concepcion Tayco-Flores is the
owner of the properties so that it will be easy for her to use the
same as collateral for a prospective loan. Should the
encumbrance not materialize or if it did after the obligation
thereunder has been paid, the document shall become null and
void and without effect. As the evidence disclosed that the
intended loan with any financial institution did not materialize,
hence, immediately thereafter, the document had no more effect.
[24]

As to the other questioned document or the Confirmation of Quitclaim of

Shares in Three Parcels of Land, the nullity of the first document renders it void
because its effectivity is anchored on the validity of the first document. The
Confirmation of Quitclaim of Shares in Three Parcels of Land came into fruition
merely to confirm the existence of the first document. It was executed on March
16, 1991, when petitioner Francisco Tayco was still alive. Nevertheless, the said
document was signed only by Consolacion and Concepcion, which prompted the
trial court to make the following observations:

As to Exhibit B, it is surprising why only the two sisters

participated in its execution while the plaintiff who is still very
much alive and also a resident of New Buswang, Kalibo, Aklan was

27

excluded. This document is a confirmation of the execution of

Exhibit A where the plaintiff is a party. The plaintiff would have
also been made a party to this document so that he could have
confirmed the sale of his share had it been so. Could it be,
therefore, that defendants did not want the plaintiff to know this
document so that they can obtain the transfer of the titles and the
tax
declarations
in
their
names
without
his
knowledge? Unfortunately,
however,
plaintiff
accidentally
discovered the transfer when he tried to survey the property for
ultimate partition.[25]

To reiterate, in the exercise of the Supreme Courts power of review, this Court is not
a trier of facts, and unless there are excepting circumstances, it does not routinely
undertake the re-examination of the evidence presented by the contending parties
during the trial of the case.[26] The CA, therefore, erred in disregarding the factual
findings of the trial court without providing any substantial evidence to support its
own findings.

Republic of the Philippines

WHEREFORE,
the
petition
for
review
on certiorari is
hereby GRANTED. Consequently, the Court of Appeals' Decision dated November
17, 2004 is REVERSED and SET ASIDE and the Decision of the Regional Trial Court
of Kalibo, Aklan, Branch 9, dated October 2, 2001, is UPHELD and REINSTATED.

Supreme Court
Manila

SO ORDERED.
SECOND DIVISION
RAMON B. BRITO, SR.,

G.R. No. 171717

Petitioner,
Present:
- versus CARPIO, J., Chairperson,
NACHURA,
PERALTA,
SEVERINO D. DIANALA, VIOLETA DIANALA SALES,
JOVITA DIANALA DEQUINTO, ROSITA DIANALA,
CONCHITA DIANALA and JOEL DEQUINTO,
Respondents.

ABAD, and
MENDOZA, JJ.

Promulgated:

28

December 15, 2010

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

D E CI S I O N

PERALTA, J.

Before the Court is a petition for review on certiorari seeking to annul and set aside
the Decision[1] dated January 12, 2005 and Resolution[2] dated February 13, 2006 of
the Court of Appeals (CA) in CA-G.R. CV No. 70009. The assailed Decision set aside
the Joint Orders[3] dated June 29, 2000 of the Regional Trial Court (RTC) of Negros
Occidental, Branch 60, Cadiz City, while the questioned Resolution denied
petitioner's Motion for Reconsideration.

Court) of Negros Occidental,against a certain Jose Maria Golez. The case was
docketed as Civil Case No. 12887.

Petitioner's wife, Margarita, together with Bienvenido and Francisco, alleged that
they are the heirs of a certain Vicente Dichimo, while Edito, Maria, Herminia,
Leonora, Felicito and Merlinda claimed to be the heirs of one Eusebio Dichimo; that
Vicente and Eusebio are the only heirs of Esteban and Eufemia; that Esteban and
Eufemia died intestate and upon their death Vicente and Eusebio, as compulsory
heirs, inherited Lot No. 1536-B; that, in turn, Vicente and Eusebio, and their
respective spouses, also died intestate leaving their pro indiviso shares of Lot No.
1536-B as part of the inheritance of the complainants in Civil Case No. 12887.

On July 29, 1983, herein respondents filed an Answer-in-Intervention claiming that

prior to his marriage to Eufemia, Esteban was married to a certain Francisca
Dumalagan; that Esteban and Francisca bore five children, all of whom are already
deceased; that herein respondents are the heirs of Esteban and Francisca's children;
that they are in open, actual, public and uninterrupted possession of a portion of Lot
No. 1536-B for more than 30 years; that their legal interests over the subject lot
prevails over those of petitioner and his co-heirs; that, in fact, petitioner and his coheirs have already disposed of their shares in the said property a long time ago.

The factual and procedural antecedents of the case are as follows:

Subject of the present petition is a parcel of land located at Barrio Sicaba, Cadiz
City, Negros Occidental. The said tract of land is a portion of Lot No. 1536-B,
formerly known as Lot No. 591-B, originally owned by a certain Esteban Dichimo
and his wife, Eufemia Dianala, both of whom are already deceased.

On November 26, 1986, the trial court issued an Order dismissing without prejudice
respondents' Answer-in-Intervention for their failure to secure the services of a
counsel despite ample opportunity given them.

Civil Case No. 12887 then went to trial.

On September 27, 1976, Margarita Dichimo, assisted by her husband, Ramon Brito,
Sr., together with Bienvenido Dichimo, Francisco Dichimo, Edito Dichimo, Maria
Dichimo, Herminia Dichimo, assisted by her husband, Angelino Mission, Leonora
Dechimo, assisted by her husband, Igmedio Mission, Felicito, and Merlinda Dechimo,
assisted by her husband, Fausto Dolleno, filed a Complaint for Recovery of
Possession and Damages with the then Court of First Instance (now Regional Trial

Subsequently, the parties in Civil Case No. 12887 agreed to enter into a
Compromise Agreement wherein Lot No. 1536-B was divided between Jose Maria
Golez, on one hand, and the heirs of Vicente, namely: Margarita, Bienvenido, and
Francisco, on the other. It was stated in the said agreement that the heirs of
Eusebio had sold their share in the said lot to the mother of Golez. Thus, on

29

September 9, 1998, the Regional Trial Court (RTC) of Bacolod City, Branch 45
rendered a decision approving the said Compromise Agreement.

Thereafter, TCT No. T-12561 was issued by the Register of Deeds of Cadiz City in
the name of Margarita, Bienvenido and Francisco.

On January 18, 1999, herein petitioner and his co-heirs filed another Complaint for
Recovery of Possession and Damages, this time against herein respondents. The
case, filed with the RTC of Cadiz City, Branch 60, was docketed as Civil Case No.
548-C. Herein respondents, on the other hand, filed with the same court, on August
18, 1999, a Complaint for Reconveyance and Damages against petitioner and his
co-heirs. The case was docketed as Civil Case No. 588-C.

The parties filed their respective Motions to Dismiss. Thereafter, the cases were
consolidated.

2. The Motion to Dismiss Civil Case No. 588-C is likewise hereby

GRANTED and the Complaint dated August 13, 1999 is hereby
DISMISSED for want of jurisdiction.

3. All counterclaims in both cases, Civil Case No. 548-C and 588-C
are likewise ordered DISMISSED.

SO ORDERED.[4]

The parties filed their respective motions for reconsideration, but both were denied
by the RTC in an Order dated October 5, 2000.

Herein respondents then appealed the case to the CA praying that the portion of the
RTC Joint Orders dismissing Civil Case No. 588-C be declared null and void and that
the case be decided on the merits.

On June 29, 2000, the RTC issued Joint Orders, disposing as follows:
On January 12, 2005, the CA rendered judgment disposing as follows:
WHEREFORE, in view of the foregoing, this Court hereby orders
the following:

1.
The Motion to Dismiss Civil Case No. 548-C
is hereby GRANTED and Civil Case No. 548[-C] is hereby ordered
DISMISSED for violation of the rule on forum shopping;

WHEREFORE, in view of the foregoing premises, judgment is

hereby rendered by us GRANTING the appeal filed in this case
and SETTING ASIDE, as we hereby set aside, the Joint Order[s]
dated June 29, 2000 of the RTC of Cadiz City, Branch 60,
dismissing Civil Case No. 588-C. Further, let the entire records of
this case be remanded to the court a quo for the trial and hearing
on the merits of Civil Case No. 588-C.

SO ORDERED.[5]

30

Petitioner filed a Motion for Reconsideration, but the CA denied it in a Resolution

dated February 13, 2006.

Hence, the instant petition with the following assigned errors:

I.

THE HONORABLE COURT OF APPEALS ERRED WHEN IT

RULED THAT THE LOWER COURT HAS THE JURISDICTION
TO HEAR THE RECONVEYANCE CASE OF THE HEREIN
PLAINTIFFS-APPELLANTS BEFORE THE REGIONAL TRIAL
COURT OF NEGROS OCCIDENTAL, BRANCH 60, CADIZ CITY.

II.

THE HONORABLE COURT OF APPEALS ERRED IN

FINDING THAT THE AMENDMENT OF THE DECISION IN
CIVIL CASE NO. 12887 IS NOT TANTAMOUNT TO
ANNULMENT OF THE SAID DECISION. THE HONORABLE
COURT IS WITHOUT JURISDICTION TO TAKE COGNIZANCE
OF THIS CASE.[6]

In his first assigned error, petitioner claims that the CA erred in holding that
respondents are not parties in Civil Case No. 12887 contending that, since their
Answer-in-Intervention was admitted, respondents should be considered parties in
the said case. Petitioner also avers that, being parties in Civil Case No. 12887,
respondents are bound by the judgment rendered therein.

It is true that the filing of motions seeking affirmative relief, such as, to admit
answer, for additional time to file answer, for reconsideration of a default judgment,
and to lift order of default with motion for reconsideration, are considered voluntary
submission to the jurisdiction of the court. [7] In the present case, when respondents
filed their Answer-in-Intervention they submitted themselves to the jurisdiction of
the court and the court, in turn, acquired jurisdiction over their persons.
Respondents, thus, became parties to the action. Subsequently, however,
respondents' Answer-in-Intervention was dismissed without prejudice. From then
on, they ceased to be parties in the case so much so that they did not have the
opportunity to present evidence to support their claims, much less participate in the
compromise agreement entered into by and between herein petitioner and his coheirs on one hand and the defendant in Civil Case No. 12887 on the other. Stated
differently, when their Answer-in-Intervention was dismissed, herein respondents
lost their standing in court and, consequently, became strangers to Civil Case No.
12887. It is basic that no man shall be affected by any proceeding to which he is a
stranger, and strangers to a case are not bound by judgment rendered by the court.
[8]
Thus, being strangers to Civil Case No. 12887, respondents are not bound by the
judgment rendered therein.

Neither does the Court concur with petitioner's argument that respondents are
barred by prescription for having filed their complaint for reconveyance only after
more than eight years from the discovery of the fraud allegedly committed by
petitioner and his co-heirs, arguing that under the law an action for reconveyance of
real property resulting from fraud prescribes in four years, which period is reckoned
from the discovery of the fraud.

In their complaint for reconveyance and damages, respondents alleged that

petitioner and his co-heirs acquired the subject property by means of fraud.

Article 1456 of the Civil Code provides that a person acquiring property through
fraud becomes, by operation of law, a trustee of an implied trust for the benefit of
the real owner of the property. An action for reconveyance based on an implied trust
prescribes in ten years, the reckoning point of which is the date of registration of

The Court is not persuaded.

31

the deed or the date of issuance of the certificate of title over the property. [9] Thus,
in Caro v. Court of Appeals,[10] this Court held as follows:

Civil Code), so is the corresponding obligation to reconvey the

property and the title thereto in favor of the true owner. In this
context, and vis-a-vis prescription, Article 1144 of the Civil Code
is applicable.

x x x The case of Liwalug Amerol, et al. v. Molok Bagumbaran,

G.R. No. L-33261, September 30, 1987,154 SCRA 396, illuminated
what used to be a gray area on the prescriptive period for an
action to reconvey the title to real property and, corollarily, its
point of reference:

Article 1144. The following actions must be

brought within ten years from the time the right
of action accrues:

x x x It must be remembered that before August

30, 1950, the date of the effectivity of the new
Civil Code, the old Code of Civil Procedure (Act
No. 190) governed prescription. It provided:

SEC. 43. Other civil actions; how limited.- Civil

actions other than for the recovery of real
property can only be brought within the
following periods after the right of action
accrues:

xxxxxxxxx

3.
Within four years: xxx An action
for relief on the ground of fraud, but the right of
action in such case shall not be deemed to have
accrued until the discovery of the fraud;
xxxxxxxxx

In contrast, under the present Civil Code, we find that just as an

implied or constructive trust is an offspring of the law (Art. 1456,

(1)

Upon a written contract;

(2)

Upon an obligation created by law;

(3)

Upon a judgment.

x x x x x x x x x. (Italics supplied.)

An action for reconveyance based on an implied or constructive

trust must perforce prescribe in ten years and not otherwise. A
long line of decisions of this Court, and of very recent vintage at
that, illustrates this rule. Undoubtedly, it is now well settled that
an action for reconveyance based on an implied or constructive
trust prescribes in ten years from the issuance of the Torrens title
over the property. The only discordant note, it seems, is Balbin vs.
Medalla, which states that the prescriptive period for a
reconveyance action is four years. However, this variance can be
explained by the erroneous reliance on Gerona vs. de Guzman.
But in Gerona, the fraud was discovered on June 25, 1948, hence
Section 43(3) of Act No. 190, was applied, the new Civil Code not
coming into effect until August 30, 1950 as mentioned earlier. It
must be stressed, at this juncture, that article 1144 and article
1456, are new provisions. They have no counterparts in the old
Civil Code or in the old Code of Civil Procedure, the latter being
then resorted to as legal basis of the four-year prescriptive period

32

for an action for reconveyance of title of real property acquired

under false pretenses.

August 18, 1999. Hence, it is clear that the ten-year prescriptive period has not yet
expired.

An action for reconveyance has its basis in Section 53, paragraph

3 of Presidential Decree No. 1529, which provides:

The Court, likewise, does not agree with petitioner's contention that respondents
are guilty of laches and are already estopped from questioning the decision of the
RTC in Civil Case No. 12887 on the ground that they slept on their rights and
allowed the said decision to become final.

In all cases of registration procured by fraud,

the owner may pursue all his legal and equitable
remedies against the parties to such fraud
without prejudice, however, to the rights of any
innocent holder of the decree of registration on
the original petition or application, x x x.

This provision should be read in conjunction with Article 1456 of

the Civil Code, x x x

xxxx

The law thereby creates the obligation of the trustee to reconvey

the property and the title thereto in favor of the true owner.
Correlating Section 53, paragraph 3 of Presidential Decree No.
1529 and Article 1456 of the Civil Code with Article 1144(2) of the
Civil Code, supra, the prescriptive period for the reconveyance of
fraudulently registered real property is ten (10) years reckoned
from the date of the issuance of the certificate of title. x x x[11]

In the instant case, TCT No. T-12561 was obtained by petitioner and his co-heirs on
September 28, 1990, while respondents filed their complaint for reconveyance on

In the first place, respondents cannot be faulted for not appealing the decision of
the RTC in Civil Case No. 12887 simply because they are no longer parties to the
case and, as such, have no personality to assail the said judgment.

Secondly, respondents' act of filing their action for reconveyance within the ten-year
prescriptive period does not constitute an unreasonable delay in asserting their
right. The Court has ruled that, unless reasons of inequitable proportions are
adduced, a delay within the prescriptive period is sanctioned by law and is not
considered to be a delay that would bar relief. [12] Laches is recourse in equity.
[13]
Equity, however, is applied only in the absence, never in contravention, of
statutory law.[14]

Moreover, the prescriptive period applies only if there is an actual need to reconvey
the property as when the plaintiff is not in possession thereof. [15] Otherwise, if the
plaintiff is in possession of the property, prescription does not commence to run
against him.[16] Thus, when an action for reconveyance is nonetheless filed, it would
be in the nature of a suit for quieting of title, an action that is imprescriptible. [17] The
reason for this is that one who is in actual possession of a piece of land claiming to
be the owner thereof may wait until his possession is disturbed or his title is
attacked before taking steps to vindicate his right, the rationale for the rule being,
that his undisturbed possession provides him a continuing right to seek the aid of a
court of equity to ascertain and determine the nature of the adverse claim of a third
party and its effect on his own title, which right can be claimed only by the one who
is in possession.[18]

33

In the present case, there is no dispute that respondents are in possession of the
subject property as evidenced by the fact that petitioner and his co-heirs filed a
separate action against respondents for recovery of possession thereof. Thus, owing
to respondents' possession of the disputed property, it follows that their complaint
for reconveyance is, in fact, imprescriptible. As such, with more reason should
respondents not be held guilty of laches as the said doctrine, which is one in equity,
cannot be set up to resist the enforcement of an imprescriptible legal right.

WHEREFORE, the instant petition is DENIED. The assailed Decision dated January
12, 2005 and Resolution dated February 13, 2006 of the Court of Appeals in CAG.R. CV No. 70009 are AFFIRMED.

SO ORDERED.

In his second assignment of error, petitioner argues that the objective of

respondents in filing Civil Case No. 588-C with the RTC of Cadiz City was to have the
decision of the RTC of Bacolod City in Civil Case No. 12887 amended, which is
tantamount to having the same annulled. Petitioner avers that the RTC of Cadiz City
has no jurisdiction to act on Civil Case No. 588-C, because it cannot annul the
decision of the RTC of Bacolod City which is a co-equal court.

The Court does not agree.

The action filed by respondents with the RTC of Cadiz City is for reconveyance and
damages. They are not seeking the amendment nor the annulment of the Decision
of the RTC of Bacolod City in Civil Case No. 12887. They are simply after the
recovery of what they claim as their rightful share in the subject lot as heirs of
Esteban Dichimo.

As earlier discussed, respondents' Answer-in-Intervention was dismissed by the RTC

of Bacolod City without prejudice. This leaves them with no other option but to
institute a separate action for the protection and enforcement of their rights and
interests. It will be the height of inequity to declare herein petitioner and his coheirs as exclusive owners of the disputed lot without giving respondents the
opportunity to prove their claims that they have legal interest over the subject
parcel of land, that it forms part of the estate of their deceased predecessor and
that they are in open, and uninterrupted possession of the same for more than 30
years. Much more, it would be tantamount to a violation of the constitutional
guarantee that no person shall be deprived of property without due process of law.
[19]

34

Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-19060

May 29, 1964

IGNACIO GERONA, MARIA CONCEPCION GERONA, FRANCISCO GERONA and

DELFIN GERONA,petitioners,
vs.
CARMEN DE GUZMAN, JOSE DE GUZMAN, CLEMENTE DE GUZMAN,
FRANCISCO DE GUZMAN, RUSTICA DE GUZMAN, PACITA DE GUZMAN and
VICTORIA DE GUZMANrespondents.
Manuel J. Serapio for petitioners.
D. F. Castro and Associates for respondents.

deeds to cancel the transfer certificates of title secured by respondents as above

stated and to issue new certificates of title in the name of both the petitioners and
the respondents in the proportion of 1/8th for the former and 7/8th for the latter;
ordering the respondents to render accounts of the income of said properties and to
deliver to petitioners their lawful share therein; and sentencing respondents to pay
damages and attorney's fees.
In their answer, respondents maintained that petitioners' mother, the deceased
Placida de Guzman, was not entitled to share in the estate of Marcelo de Guzman,
she being merely a spurious child of the latter, and that petitioners' action is barred
by the statute of limitations.
After appropriate proceedings, the trial court rendered a decision finding that
petitioners' mother was a legitimate child, by first marriage, of Marcelo de Guzman;
that the properties described in the complaint belonged to the conjugal partnership
of Marcelo de Guzman and his second wife, Camila Ramos; and that petitioners'
action has already prescribed, and, accordingly, dismissing the complaint without
costs. On appeal taken by the petitioners, this decision as affirmed by the Court of
Appeals, with costs against them.

CONCEPCION, J.:
Appeal by certiorari from a decision of the Court of Appeals, affirming that of the
Court of First Instance of Bulacan.
In the complaint, filed with the latter court on September 4, 1958, petitioners
herein, namely, Ignacio, Maria Concepcion, Francisco and Delfin, all surnamed
Gerona, alleged that they are the legitimate children of Domingo Gerona and Placida
de Guzman; that the latter, who died on August 9, 1941 was a legitimate daughter
of Marcelo de Guzman and his first wife, Teodora de la Cruz; that after the death of
his first wife, Marcelo de Guzman married Camila Ramos, who begot him several
children, namely, respondents Carmen, Jose, Clemente, Francisco, Rustica, Pacita
and Victoria, all surnamed De Guzman; that Marcelo de Guzman died on September
11, 1945; that subsequently, or on May 6, 1948, respondents executed a deed of
"extra-judicial settlement of the estate of the deceased Marcelo de Guzman",
fraudulently misrepresenting therein that they were the only surviving heirs of the
deceased Marcelo de Guzman, although they well knew that petitioners were, also,
his forced heirs; that respondents had thereby succeeded fraudulently in causing
the transfer certificates of title to seven (7) parcels of land, issued in the name of
said deceased, to be cancelled and new transfer certificates of title to be issued in
their own name, in the proportion of 1/7th individual interest for each; that such
fraud was discovered by the petitioners only the year before the institution of the
case; that petitioners forthwith demanded from respondents their (petitioners)
share in said properties, to the extent of 1/8th interest thereon; and that the
respondents refused to heed said demand, thereby causing damages to the
petitioners. Accordingly, the latter prayed that judgment be rendered nullifying said
deed of extra-judicial settlement, insofar as it deprives them of their participation of
1/18th of the properties in litigation; ordering the respondents to reconvey to
petitioners their aforementioned share in said properties; ordering the register of

Petitioners maintain that since they and respondents are co-heirs of the deceased
Marcelo de Guzman, the present action for partition of the latter's estate is not
subject to the statute of limitations of action; that, if affected by said statute, the
period of four (4) years therein prescribed did not begin to run until actual discovery
of the fraud perpetrated by respondents, which, it is claimed, took place in 1956 or
1957; and that accordingly, said period had not expired when the present action
was commenced on November 4, 1958.
Petitioners' contention is untenable. Although, as a general rule, an action for
partition among co-heirs does not prescribe, this is true only as long as the
defendants do not hold the property in question under an adverse title (Cordova vs.
Cordova, L-9936, January 14, 1948). The statute of limitations operates as in other
cases, from the moment such adverse title is asserted by the possessor of the
property (Ramos vs. Ramos, 45 Phil. 362; Bargayo v. Camumot, 40 Phil. 857;
Castro v. Echarri, 20 Phil. 23).
When respondents executed the aforementioned deed of extra-judicial settlement
stating therein that they are the sole heirs of the late Marcelo de Guzman, and
secured new transfer certificates of title in their own name, they thereby excluded
the petitioners from the estate of the deceased, and, consequently, set up a title
adverse to them. And this is why petitioners have brought this action for the
annulment of said deed upon the ground that the same is tainted with
fraud. 1wph1.t
Although, there are some decisions to the contrary (Jacinto v. Mendoza, L-12540,
February 28, 1959; Cuison v. Fernandez, L-11764, January 31, 1959; Maribiles v.
Quinto, L-10408, October 18, 1956; and Sevilla v. De los Angeles, L-7745,

35

November 18, 1955), it is already settled in this jurisdiction that an action for
reconveyance of real property based upon a constructive or implied trust, resulting
from fraud, may be barred by the statute of limitations (Candelaria v. Romero, L12149, September 30, 1960; Alzona v. Capunita, L-10220, February 28, 1962).
Inasmuch as petitioners seek to annul the aforementioned deed of "extra-judicial
settlement" upon the ground of fraud in the execution thereof, the action therefor
may be filed within four (4) years from the discovery of the fraud (Mauricio v.
Villanueva, L-11072, September 24, 1959). Such discovery is deemed to have taken
place, in the case at bar, on June 25, 1948, when said instrument was filed with the
Register of Deeds and new certificates of title were issued in the name of
respondents exclusively, for the registration of the deed of extra-judicial settlement
constitute constructive notice to the whole world (Diaz v. Gorricho, L-11229, March
29, 1958; Avecilla v. Yatco, L-11578, May 14, 1958; J.M. Tuason & Co., Inc. v.
Magdangal, L-15539, January 30, 1962; Lopez v. Gonzaga, L-18788, January 31,
1964).
As correctly stated in the decision of the trial court:
In the light of the foregoing it must, therefore, be held that plaintiffs
learned at least constructively, of the alleged fraud committed against
them by defendants on 25 June 1948 when the deed of extra-judicial
settlement of the estate of the deceased Marcelo de Guzman was
registered in the registry of deeds of Bulacan, Plaintiffs' complaint in this
case was not filed until 4 November 1958, or more than 10 years
thereafter. Plaintiff Ignacio Gerona became of age on 3 March 1948. He is
deemed to have discovered defendants' fraud on 25 June 1948 and had,
therefore, only 4 years from the said date within which to file this action.
Plaintiff Maria Concepcion Gerona became of age on 8 December 1949 or
after the registration of the deed of extra-judicial settlement. She also had
only the remainder of the period of 4 years from December 1949 within
which to commence her action. Plaintiff Francisco Gerona became of age
only on 9 January 1952 so that he was still a minor when he gained
knowledge (even if only constructive) of the deed of extra-judicial
settlement on 25 June 1948. Likewise, plaintiff Delfin Gerona became of
legal age on 5 August 1954, so that he was also still a minor at the time he
gained knowledge (although constructive) of the deed of extra-judicial
settlement on 25 June 1948. Francisco Gerona and Delfin Gerona had,
therefore, two years after the removal of their disability within which to
commence their action (Section 45, paragraph 3, in relation to Section 43,
Act 190), that is, January 29, 1952, with respect to Francisco, and 5
August 1954, with respect to Delfin.
WHEREFORE, the decision of the Court of Appeals is hereby affirmed, with costs
against petitioners herein. It is so ordered.

36

Republic of the Philippines

SUPREME COURT
Manila
SECOND DIVISION
G.R. No. L-46410 October 30, 1981
ERNESTO BALBIN, JOSE ORIA, MAURICIO NARAG, ROSA STA. MA.
SYTAMCO, BASILIO SYTAMCO, LEOCADIO SYTAMCO, AMADO V. REYES,
LYDIA V. REYES and APOLINARIO REYES, petitioners,
vs.
PEDRO C. MEDALLA and JOSEFINA MEDALLA and LINO BARBOSA, Judge of
the Court of First Instance of Mamburao, Occidental Mindoro, respondents.

DE CASTRO, J.:
Petition for certiorari for the review of the decision of the Court of First Instance of
Occidental Mindoro, Branch I, the dispositive portion of which reads:
WHEREFORE, judgment is hereby rendered as follows:
1. that the lands in controversy be, as they are hereby declared as
the private properties of the plaintiffs with the right of immediate
possession;
2. that the Free Patents Nos. HV-85975, RV-86191, HV-85977,
HV-85976, HV-85978, HV-85974, EV-85432, EV-94632 and EV58631, and the corresponding Original Certification of Titles Nos.
P-3088, P-3089, P-3087, P-4010, P-4011, P-3084, P-919, P-4060
and P-920 be, as they are hereby declared null and void and
therefor should be cancelled;
3. that defendants, ERNESTO BALBIN the HRS. of MAURICIO
NARAG and JOSE ORINA shall pay the plaintiffs as damages, the
sum of TWO HUNDRED (P200.00 PESOS per hectare possessed
and cultivated by them from the year 1963 until the possession of

the property in question has been duly surrendered to the

plaintiffs, with interest at the rate of 6% per annum, from the
date of this decision, and because said defendants must have paid
the corresponding land taxes due them from the said date (1963),
whatever amounts paid by them from said date to the present
should correspondingly be deducted from the total amount of
damages herein awarded to plaintiffs; however, defendants, ROSA
STA. MA. SYTAMCO, BASILIO SYTAMCO, LEOCADIO SYTAMCO,
AMADO V. REYES, LYDIA REYES and APOLINARIO REYES, shall not
pay any amount to plaintiffs as damages as they are not in actual
possession and cultivation of the area respectively claimed by
them and
4. that the defendants shall further pay the amount of ?2,000.00
as attorney's fees and cost of the suit.
The following facts, quoting from private respondents' brief, are not disputed:
Private respondents on June 19, 1962, purchased from the heirs
of Juan Ladao, a large parcel of agricultural land situated at Sitios
of Bacong, Tambunakan and Ibunan, Barrio Balansay Mamburao,
Occidental, Mindoro. Said respondents on June 14, 1963, filed an
application for registration of title of the said parcel of land. They
utilized as evidence of ownership, the Deed of Sale executed in
their favor by the heirs of the late Juan Ladao (Exhibit "F" thereof)
the Informacion Posesoria issued in the name of Juan Ladao
Exhibit "H" in the LRC Case) together with the tax declaration and
tax receipts for said land covering the period from May 26, 1904,
to January 27, 1962 (Exhibits I to I-28 of said LRC Case) the
private respondents, after the sale, declared it for taxation
purposes (Exhibits G and G-1) of said LRC Case), and have
continuously been paying the corresponding taxes up to the
present; the application for registration of title aforesaid was
opposed by petitioners on the ground that they were previously
issued Original Certificates of title thru either Homestead or Free
Patent grants. Petitioner Rosa Sta. Maria Sytamco was issued
Original Certificate of Title No. P-3088 (Exhibit "1" on June 26,
1963, under Homestead Patent No. HV-85975; Basilio Sytamco
was issued Original Certificate of Title No. P-3089 (Exhibit "2" on
June 26, 1963, under Homestead Patent No. HV-86191; Leocadio
Sytamco was issued Original Certificate of Title No. P-3087
(Exhibit "3" on June 26, 1963, under Homestead Patent No. HV85977; Lydia Reyes was issued Original Certificate of Title No. P4010 (Exhibit "4" on September 30, 1963), under Homestead
Patent No. HV-85978; Amado Reyes was issued Original
Certificate of Title No. P-4011 (Exhibit "5" on September 30,
1963), under Homestead Patent No. V-85976; Apolinario Reyes
was issued Original Certificate of Title No. P-3084 (Exhibit "6") on

37

June 18, 1963, under Homestead Patent No. V-85974; Ernesto

Balbin was issued Original Certificate of Title No. P-919 (Exhibit
"7"), under Free Patent No. V-58633; Mauricio Narag was issued
Original Certificate of Title No. P-4060 (Exhibit 118") on October
14, 1959, under Free Patent No. V-94632-1 Jose Orina was issued
Original Certificate of Title No. P-920 (Exhibit "9") on April 3, 1957
under Free Patent No. V-58631. 1
It appears that before the filing of the present action for reconveyance and
annulment of titles on August 30, 1973, land registration proceedings had been
instituted by private respondents covering the same lands involved in the aforesaid
action. Petitioners herein filed opposition to the application, but because of the
reservation of private respondents to file a separate action for the cancellation of
the original certificates of title issued to petitioners herein, the land registration
court abstained from ruling on the petitioners' opposition.
In the pre-trial of the ordinary action from which the present petition stemmed, the
following stipulation of facts 2was entered into:
1. That the parcels of land subject matter of the instant case are
Identified as Lot Nos. 979, 980, 981, 982, 983, 984, 1013, 1016
and 1006, as shown in plans Ap-10864 and Ap-10866; that these
lots enumerated are embraced in Pls-21, Mamburao Public
Subdivision;
2. That the herein petitioners were among the oppositors in Land
Registration Case No. N-44, filed before the court (CFI Occidental
Mindoro, Branch I, Mamburao, Occidental Mindoro) on June
14,1963 by spouses Pedro C. Medalla and Josefina O. Medalla;
3. That the opposition of petitioners is based on the ground that
the aforesaid lots respectively titled in their names are included in
the land subject matter of the Land Registration Case No. N-44;
4. That in the Decision rendered by the court in Land Registration
Case No. N-44 dated May 7, 1969 giving due course to the
applicants' petition for registration of title, the opposition of the
petitioners were not resolved in view of the reservation made by
the applicants to file appropriate actions for the cancellation of
petitioners' homestead or patent titles.
5. That the land subject matter of the instant case are titled in the
name of petitioners and included in plans AP-10864 and Ap10866, which plans were submitted as evidence in the said Land
Registration Case No. N-44, and that the basis of herein
respondents' claim in the instant case is the possessory

information title of Juan Ladao, registered on May 25, 1895 before

the Register of Deeds of the Province of Occidental Mindoro.
Petitioners made the following assignment of errors:

I. That the respondent judge of the court a quo erred in holding

the validity of the possessory information title of Juan Ladao,
consequently, erroneously holding that the parcels of land covered
by certificate of titles of petitioners are private properties of
private respondents.
II. That respondent judge of the court a quo erred in holding that
private respondents' cause of action has not prescribed.
III. The respondent judge of the court a quo erred in holding that
private respondents have personality and capacity to institute the
action, considering that the land in controversy were public lands
at the time of issuance of respective patents and titles of
petitioners.
IV. The respondent judge of the court a quo erred in holding that
the lower court has jurisdiction over the nature and cause of
action of private respondents.
The first question to be resolved relates to the validity of the possessory information
title of Juan Ladao as raised in the first assignment of error because petitioners' title
to the land based on their respective homestead or free patents is valid or not,
depending on whether the land so disposed of under the Public Land Act has not yet
been segregated from the public domain and passed into private ownership at the
time of the issuance of the patents. 4
As found uncontroverted by the lower court, there exists an Information
Posesoria in the name of Juan Ladao from whom private respondents Medalla
bought the land. It is also an admitted fact, at least impliedly, same being not
denied in petitioners' answer to the complaint, that the Informacion Posesoria was
registered on May 25, 1896. What petitioners assail is the validity of the registration
which they claim to have been done beyond the period of one year from April 17,
1894 to April 17, 1895, as allegedly required by the Royal Decree of February 13,
1894 otherwise known as the Maura Law. The provision invoked by petitioners is
Article 21 of the aforementioned decree which reads:
Art. 21. A term of one year, without grace, is granted in order to
perfect the information referred to in Articles 19 and 20.
After the expiration of this period, the right of the cultivators and
possessors to obtain a gratuitous title shall be extinguished; the

38

full ownership of the land shag be restored to the State, or in a

proper case to the community of neighbors, and the said
possessors and cultivators or their predecessors in interest by a
universal title shall only be entitled to the right of redemption, if
the land had been sold within the five years subsequent to the
lapse of the period.
The possessors not included within the provisions of this Chapter
shall only acquire for some time the ownership of the alienable
lands of the royal patrimony, in accordance with the common law.
It is the petitioners' contention that pursuant to the aforecited provision, all grants
of Spanish titles to lands including possessory information titles must be registered
within a period of one (1) year to be counted from April 17, 1894 until April 17,
1895, in accordance with Article 80 of the rules and regulations implementing said
Royal Decree of February 13, 1894; that this requirement of the law finds support in
the cases of Baltazar vs. Insular Government, 40 Phil. 267 and Romero v. Director
of Lands, 39 Phil. 814 from which petitioners quoted the following.
All such titles covered by possessory information title during the
Spanish Regime and not registeredwithin the non-extendible
period of one year as provided for in the Maura Law or the Royal
Decree of February 13, 1894, it reverts to the State or in a proper
case to the public domain. (Emphasis supplied).
Petitioners further contend that inasmuch as the possessory information title of
respondents, in the name of the late Juan Ladao, was registered only on May 25,
1895 or 38 days from the last day of the one-year period as provided in the Maura
Law, the same was patently nun and void, and the land covered by said possessory
information title reverted to the State or to the public domain of the government.
Petitioners' contention is without merit. Examining closely the two cases invoked by
petitioners, nowhere in said cases can be found the aforecited passages quoted by
the petitioners. These cases did not even speak ofregistration as a requisite for the
validity of possessory information title obtained for purposes of Royal Decree of
February 13, 1894 or the Maura Law. What was actually stated in the two aforecited
cases are the following
A possessory information proceeding instituted in accordance with
the provisions of the Mortgage Law in force on July 14, 1893
neither constitutes nor is clothed with the character of a
gratuitous title to property, referred to in Section 19 of the Royal
Decree of February 13, 1894, which provides that in order that an
information may be valid for the purpose of the said Royal Decree
and produce the effects of a title of ownership, it is indispensable
what it be instituted within the unextended period of one year

fixed in sections 19 and 20 of the said Royal Decree (Aguinaldo de

Romero vs. Director of Land 39 Phil. 814).
The time within which advantage could be taken of the Maura Law
expired on April 17, 1895. Almeida obtained dominion over 526
hectares of lands on June 9, 1895. The possessory information for
815 hectares was issued to Almeida on December 14, 1896
Almeida was thus not in possession until after the expiration of
the period specified by the Maura Law for the issuance of
possessory titles and his possessory information was of even a
later date and made to cover a large excess of land. Under these
conditions, the possessory information could not even furnish, as
in other cases, prima facie evidence of the fact that at the time of
the execution the claimant was in possession, which it would be
possible to convert into ownership by uninterrupted possession for
the statutory period. (Baltazar vs. Insular Government 40 Phil.
267).
From the foregoing, it is made clear that what was required is merely the institution
of a possessory information proceeding within the one-year period as provided in
the Royal Decree of February 13, 1894 or the Maura Law. This fact is bolstered by
the commentaries of Prof. Francisco Venture in his book Land Titles and Deeds, a
book widely used by law practitioners and in the law schools. 5 Thus
A distinction should be made between the informacion
posesoria issued in accordance with Articles 390, 391, and 392 of
the Spanish Mortgage Law in connection with Articles 19, 20 and
21 of the Royal Decree of February 13, 1894 and the informacion
posesoria issued in accordance with Articles 390, 391 and 392 of
said law without regard to the aforementioned decree. The former
was the basis of a gratuitous title of ownership which was issued
upon application of the grantee and the possessory title provided
he complied with the requisites prescribed by Articles 19 and 21 of
the aforesaid decree and Articles 81 and 82 of the Chapter IV of
the Regulations for the execution of the same decree. The
requisites to be fulfilled and steps to be taken are as follows:
1. The holder of the land must prove possession or cultivation of
the land under the conditions presented by Article 19 of the said
decree.
2. The holder of the land had to institute the possessory
information proceeding within one year from the date (April 1 7,
1894) of the publication of the Royal Decree of February 13,
1894 (Article 21, Royal Decree of February 13, 1894) (Emphasis
supplied).

39

3. After obtaining the informacion posesoria, the holder of the

land had to file a petition with the General Director of Civil
Administration, attaching thereto a certified copy of the
informacion posesoria asking for the issuance in his name of a
gratuitous title of ownership. If the said office was satisfied that
the applicant fulfilled the conditions prescribed by the law, a
gratuitous title of ownership was issued to him. Such title
oftentimes called composicion gratuita was to be registered in the
Registry of Property of the province where the land was
located. ... (pp. 30-31).
Even Section 21 of the Maura Law invoked by petitioners themselves does not speak
of registration, but merelyperfection of information title, which, as already discuss
may be done by instituting possessory information proceedings within the said oneyear period fixed by the aforementioned Royal Decree of February 13, 1894,
possibly ending in the registration of the title, depending on the evidence presented.
In the case at bar, it is admitted and uncontroverted that there exists
an informacion posesoria registered on May 25, 1895 in the name of Juan Ladao.
This registration of the informacion posesoria must have followed as the result or
outcome of a possessory information proceeding instituted by the late Juan Ladao in
accordance with Section 19 of the said Royal Decree of February 13, 1894, and
commenced within the one year period, pursuant to Section 21 of the same decree.
Otherwise, if this were not so, no registration of the said informacion
posesoriamight have been effected in the Registry of Deeds of the Province of
Occidental Mindoro, for if the registration thereof on May 25, 1895 was violative of
the decree, for being beyond the one-year period from April 17, 1894 to April 17,
1895, the Register of Deeds would certainly not have performed an illegal act.
Moreover, registration of title usually follows a specified proceeding. The registration
is the act of a government official and may not be controlled by the private party
applying for registration of his title. What is under his control is the commencement
or the institution of the prescribed proceeding for the perfection of his title for which
he may be penalized for tardiness of compliance. The institution of the proper
proceeding is clearly what is required to be done within the one-year period by the
party seeking to perfect his title, not the registration thereof, if found legally
warranted. By its nature, therefore, registration may not necessarily be within the
same one-year period. If the required proceedings are instituted, as they have to be
before the corresponding title may be issued and registered, the registration may be
possible of accomplishment only after the one-year period, considering the number
of proceedings that might have been instituted within the non-extendible period of
one year. This is what apparently happened in the instant case with the proceeding
to perfect the title commenced within the one-year period, but the registration of
the possessory information title done thereafter, or on May 25, 1895, after the
prescribed proceeding which is naturally featured with the requisite notice and
hearing. 6

The next question relates to the issue of prescription as raised in the second
assignment of error.
It is the contention of petitioners that the present action for reconveyance has
already prescribed. They developed this theory in their Reply to Rejoinder 7 to
Motion to Dismiss, as follows:
Even granting for the sake of argument that plaintiffs' possessory
information title is valid and effective, the cause of action for
reconveyance had already prescribed because such action can
only be instituted within four (4) years after discovery of the
alleged fraud. (Sec. 55, Act 496; Vera vs. Vera, 47 O.G. 5060;
Tayao vs. Robles, 7 4 Phil. 114) I t will be noted from plaintiffs'
complaint that the patent of Ernesto Balbin and Jose Orina were
issued on December 6, 1956 so that if any action for
reconveyance at all could be instituted against the two
defendants, the same should be instituted before or during the
period of four years or up to 6 December, 1960. According to the
complaint, the patents of Rosa Sta. Ma. Sytamco, Basilio Sytamco
and Leocadio Sytamco were issued on 17 April 1959, so that if any
action for reconveyance can lie against them, the same should be
instituted within four years or up to 17 April, 1963. In so far as
the free patent of Amado V. Reyes, Lydia Reyes and Apolinario
Reyes, it appears that said patents were issued on 3 March, 1959,
so that if any action for reconveyance should be filed, it should be
on or before March 3, 1963. And lastly, the patent of Mauricio
Narag was issued on 14 October, 1959, so that if any action for
reconveyance should be instituted, the same should be filed on or
before October 14, 1963.
Plaintiffs' complaint was filed only on August 30, 1973, or more
than 14 years had already elapsed from the date of the issuance
of the respective titles of the defendants. Consequently, the action
for reconveyance of land titled in the names of defendants had
already prescribed.
An action for reconveyance of real property resulting from fraud may be barred by
the statute of limitations, which requires that the action shall be filed within four (4)
years from the discovery of the fraud. Such discovery is deemed to have taken
place when the petitioners herein were issued original certificate of title through
either homestead or free patent grants, for the registration of said patents
constitute constructive notice to the whole world. 8
In the case at bar, the latest patent was issued on October 14, 1959. There is,
therefore, merit in petitioner's contention that "if any action for reconveyance
should be commenced, the same should be filed on or before October 14, 1963. But
private respondents' complaint for reconveyance and annulment of titles with

40

damages was filed only on August 30, 1973, or more than 14 years had already
elapsed from the date of the issuance of the respective titles of the defendants.
Consequently, the action for reconveyance of land titled in the names of defendants
(petitioners herein) had already prescribed."
Even from the viewpoint of acquisitive prescription, petitioners have acquired title to
the nine lots in question by virtue of possession in concept of an owner. Petitioners
herein were given either free patent or homestead patent, and original certificates
of title in their names issued to them, the latest on October 14, 1959. Said public
land patents must have been issued after the land authorities had found out, after
proper investigation, that petitioners were in actual possession of the nine lots in
question, particularly in the case of the free patents. If petitioners were in actual
possession of the nine lots, then the heirs of Ladao and the Medalla spouses were
never in actual possession of the said lots. If the Medalla spouses were not in actual
possession of the nine lots, the alleged possessory information would not justify the
registration of the said nine lots in the names of the Medallas.
A possessory information has to be confirmed in a land registration proceeding, as
required in Section 19 of Act No. 496. "A possessory information alone, without a
showing of actual, public and adverse possession of the land under claim of
ownership, for a sufficient period of time, in accordance with the law, is ineffective
as a mode of acquiring title under Act No. 496." 9 Although converted into a title of
absolute ownership, an informacion posesoria may still be lost by prescription. 10
On the other hand, the Torrens Titles issued to the petitioners on the basis of the
homestead patents and free patents obtained by them had become indefeasible. 11
It would result from what has been said on the two main assignments of errors that
petitioners herein have a better right to the land in question than the Medalla
spouses.
WHEREFORE, the judgment appealed from should be reversed and the complaint of
the Medallas should be, as it is hereby dismissed with costs against appellees.
SO ORDERED.

41

Appeal from the decision of the Court of First Instance of Zamboanga, dismissing
the appellants' complaint for reconveyance on grounds of prescription and laches.
This appeal was originally brought to the Court of Appeals, but was certified to this
Court because only questions of law are raised therein.
The following facts are not disputed:
On April 13, 1928, Francisco Arcillas and his wife Rosario Perez executed a deed of
mortgage in favor of Nanon L. Worcester over twenty-three (23) parcels of land
located in Zamboanga City, registered in the names of the spouses Arcallas, to
secure their loan of US $13,500.00. Under the contract, the loan was payable in
installments to the creditor-mortgagee for a period of five years, "the first
installment thereof to be paid on or before three (3) months after the date of this
instrument and the remaining installments in regular quarterly intervals
thereafter." 1
For violation of the aforestated stipulation, an action for foreclosure of mortgage
was instituted sometime in 1930 by Mrs. Worcester against the spouses Arcillas in
the Court of First Instance of Zamboanga. During the pendency of the action, or on
May 4, 1930, Francisco Arcillas died. He was survived by the plaintiffs herein,
namely: his widow Rosario Perez, and their children Francisco, Jose, Rosa, Trinidad,
Encarnacion, Leoncia, Juan, Tomas, Anastacio, Moises and Manuel, all surnamed
Arcillas.

Republic of the Philippines

SUPREME COURT
Manila
SECOND DIVISION
G.R. No. L-36850 September 23, 1982
ROSARIO PEREZ, FRANCISCA, JOSE, ROSA, TRINIDAD, ENCARNACION,
LEONCIA, JUAN TOMAS, ANASTACIO, MOISES and MANUEL all surnamed
ARClLLAS, plaintiffs-appellants.
vs.
PILAR ONG CHUA, RUFINA ONG CHUA, JUSTINO ONG CHUA, ALFONSO ONG
CHUA JR., BENITA ONG CHUA, ROSA ONG CHUA, ASUNCION ONG CHUA,
FRANCISCO ONG CHUA, and TERESITA ONG CHUA,defendant-appellees.

ESCOLIN, J.:

As no notice of death of defendant Francisco Arcillas was filed with the court, the
trial Judge proceeded with the case without substitution of the deceased by his legal
representative or heirs. On August 23, 1930, a judgment was rendered in favor of
the mortgagee. A writ of execution was thereafter issued, and in the ensuing
auction sale conducted on September 19, 1930, the properties encumbered were
sold to Mrs. Worcester as highest bidder. On October 6, 1930, the court issued the
corresponding order of confirmation of sale; and upon registration of the sheriff's
certificate of sale and the order of confirmation on November 24, 1930, the
certificates of title of the spouses Arcillas were cancelled and, in lieu thereof,
transfer certificates of title were issued in the name of Mrs. Worcester.
Two days later, Mrs. Worcester sold the said lands to Enrique Ong Chua, who
obtained new certificates of title in his name, and possessed the said properties as
owner. Upon Enrique's demise, the lands in question passed to his heirs: Pilar,
Rufina, Justino Alfonso, Benita, Rosa, Asuncion, Francisco and Teresita, all surnamed
Ong Chua, who have been in continuous, open and adverse possession of these
lands up to the present time.
Thirty-eight years thereafter, or on October 14, 1968, Rosario Perez and her
children filed the instant action in the Court of First Instance of Zamboanga against
the Ong Chuas for annulment of their certificates of title and for reconveyance, and

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accounting of the fruits of, the twenty-three parcels of land in question. The
complaint mainly alleged
That the Honorable Judge at the time, Nanon L. Worcester and
Enrique Ong Chua, predecessor-in-interest of the herein
defendants, by conspiring together and mutually helping one
another, were guilty of fraud and/or committed mistake in
transferring and acquiring these properties, to the damage and
prejudice of the herein plaintiffs, thereby creating an implied trust
for the benefit of the latter. 2
As heretofore stated, the court a quo, sustaining the appellees' defenses of
prescription and laches, ultimately dismissed the complaint.
We find no error committed by the trial court in dismissing the complaint. The
appellants' cause of action to cancel the certificates of title in question accrued from
1930, the year of the recording of the sheriff's deed and the issuance of the
certificates of title. Thirty-eight years had thus elapsed before appellants instituted
the present action on October 14, 1968. The continuous and public assertion of title
by the appellees and their predecessor-in-interest during this period of time was
more than sufficient to extinguish the appellants' action. The period of extinctive
prescription under Chapter III of the Code of Civil Procedure, the law in force at the
time, was only ten years.
Appellants contend, however, that the judgment rendered by the court in the
foreclosure proceedings in 1930 was erroneous because no proper substitution was
made of Francisco Arcillas, one of the defendants who died during the pendency of
the action; and since the certificates of title obtained by Mrs. Worcester under said
erroneous judgment were subject to an implied trust, which is continuing and
subsisting, the appellants' action for reconveyance cannot prescribe because
prescription does not run against their predecessor's title registered under Act 496.
Appellants' thesis overlooks the settled doctrine in this jurisdiction that an action to
enforce an implied trust may be barred not only by prescription for 10 years 3 but
also by laches. 4 Implied trusts and express trusts are distinguishable. An express
trust, which is created by the intention of the parties, disables the trustee from
acquiring for his own benefit a property committed to his custody or management
at least while he does not openly repudiate the trust and makes such repudiation
known to the beneficiary. Upon the other hand, in a constructive trust, which is
exclusively created by law, laches constitutes the bar to an action to enforce the
trust, and repudiation is not required, unless there is concealment of the facts
giving rise to the trust. 5 Thus, in Mejia de Lucas vs. Gampoa 6 this Court held that
while a person may not acquire title to a registered property through continuing

adverse possession in derogation of the title of the original registered owner,

nevertheless, such owner or his heirs, by their inaction and neglect over a long
period of time, may lose the right to recover the possession of the property and the
title thereto from the defendants.
In Go Chi Gun, et al. vs. Co Cho et al. 7, this Court spelled out the four elements of
the equitable defense of laches, to wit: (1) conduct on the part of the defendant, or
of one under whom he claims, giving rise to the situation of which complaint is
made and for which the complainant seeks remedy; (2) delay in asserting the
complainant's rights, the complainant having had knowledge or notice of the
defendants' conduct and 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 on which he bases his suit; and (4) injury or prejudice to the
defendant in the events relief is accorded to the complainant, or the suit is not held
to be barred.
In the case at bar, these four elements are present. As pointed out, Mrs. Worcester,
after having acquired the property at public auction and having obtained the
certificates of title in her name, sold on November 26, 1930 the properties in
question to Enrique Ong Chua, the appellees' predecessors-in-interest. Appellants
allowed almost four decades to lapse before taking any remedial action. Because of
their passivity and inaction during this entire period, appellees were made to feel
secure in their belief that their late father had rightly acquired the lands in question
and that no action would be filed against them. They were thus induced to spend
time, effort and money in cultivating the land, paying the taxes, and introducing
improvements therein. Undoubtedly, they would be prejudiced if the instant action
for reconveyance is not barred. It is the established principle in this jurisdiction that
inaction and neglect of a party to assert a right can convert what otherwise could be
a valid claim into a stale demand.
WHEREFORE, the order appealed from is hereby affirmed, with costs against the
appellants.
SO ORDERED.

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