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G.R. No. 132305 December 4, 2001 LABAGALA vs. SANTIAGO FACTS: Jose T. Santiago owned a parcel of land in Manila. However, his sisters sued him for recovery of 2/3 share of the land alleging that he had fraudulently registered it in his name. The trial court decided in favor of his sisters. Jose died intestate. His sisters then filed a complaint before the RTC for recovery of the 1/3 portion of said property which was in the possession of Ida C. Labagala (who claimed to be Ida C. Santiago, the daughter of Jose). The trial court ruled in favor of Labagala. According to the trial court, the said deed constitutes a valid donation. Even if it were not, petitioner would still be entitled to Jose's 1/3 portion of the property as Jose's daughter. When appealed, the Court of Appeals (CA) reversed the decision of the trial court. It took into account that Ida was born of different parents, as indicated her birth certificate. ISSUES: 1. WON respondents may impugn petitioner's filiation in this action for recovery of title and possession. 2. WON petitioner is entitled to Jose's 1/3 portion of the property he coowned with respondents, through succession, sale, or donation. HELD: The Court AFFIRMED the decision of the CA. On Issue No. 1 Yes. Article 263 refers to an action to impugn the legitimacy of a child, to

assert and prove that a person is not a man's child by his wife. However, the present respondents are asserting not merely that petitioner is not a legitimate child of Jose, but that she is not a child of Jose at all. A baptismal certificate, a private document, is not conclusive proof of filiation. Use of a family name certainly does not establish pedigree. Thus, she cannot inherit from him through intestate succession. On Issue No. 2 No. The Court ruled that there is no valid sale in this case. Jose did not have the right to transfer ownership of the entire property to petitioner since 2/3 thereof belonged to his sisters. Petitioner could not have given her consent to the contract, being a minor at the time. Consent of the contracting parties is among the essential requisites of a contract, including one of sale, absent which there can be no valid contract. Moreover, petitioner admittedly did not pay any centavo for the property which makes the sale void. Article 1471 of the Civil Code provides that if the price is simulated, the sale is void, but the act may be shown to have been in reality a donation, or some other act or contract. Neither may the purported deed of sale be a valid deed of donation. Even assuming that the deed is genuine, it cannot be a valid donation. It lacks the acceptance of the donee required by Art. 725 of the Civil Code. Being a minor, the acceptance of the donation should have been made by her father or mother or her legal representative pursuant to Art. 741 of the same Code. No one of those mentioned in the law accepted the donation for Ida. G.R. No. 125172 June 26, 1998

GUIANG vs. COURT OF APPEALS FACTS: Petitioner Gilda and Judie were legally married. During their marriage, Gilda purchased a lot. Eventually, half of it was sold to defendant spouses Guiang. While Gilda was in Manila seeking employment, petitioners husband sold to the Spouses Guiang the remaining half of their conjugal property, consisting of their residence and the lot on which it stood. This was done despite her objections. The Deed of Transfer of Rights of the said transaction was signed by the husband and witnessed by 2 of his children. To cure the defect of this deed, his husband executed an agreement with the original owner who signed as vendor. When Gilda returned home she was informed by her children that their father had a wife already. She stayed in their house, however, she was complained for trespassing by the spouses. An amicable settlement was made but she continued to stay therein. Thus, the spouses filed with the MTC a motion for the execution of the amicable settlement. Gilda then filed an amended complainant against her husband and spouses Guiang seeking the declaration of the deed of sale they executed null and void which the RTC ruled in her favor. It declared that any alienation or encumbrance by the husband of the conjugal property without the consent of his wife is null and void under the Family Code. On appeal, the Court of Appeals (CA) affirmed the lower courts decision. Hence, this petition.

ISSUES: 1. WON the contract of sale (Deed of Transfer of Rights) was merely voidable. 2. WON such contract was ratified by private respondent when she entered into an amicable settlement with them. HELD: The Court DENIES the petition and AFFIRMS the challenged decision of the CA. On Issue No. 1 No. Petitioners insist that the questioned Deed was validly executed by the parties-litigants in good faith and for valuable consideration. The absence of private Gildas consent merely rendered the Deed voidable under Article 1390 of the Civil Code, which provides: Art. 1390. The following contracts are voidable or annullable, even though there may have been no damage to the contracting parties: xxx xxx xxx (2) Those where the consent is vitiated by mistake, violence, intimidation, undue influence or fraud. These contracts are binding, unless they are annulled by a proper action in court. They are susceptible of ratification.(n) However, the above Article paragraph 2, refers to contracts visited by vices of consent, i.e., contracts which were entered into by a person whose consent was obtained and vitiated through mistake, violence, intimidation, undue influence or fraud.

In this instance, private respondent's consent to the contract of sale of their conjugal property was totally inexistent or absent. This being the case, said contract properly falls within the ambit of Article 124 of the Family Code which after it took effect, any alienation or encumbrance made by the husband of the conjugal partnership property without the consent of the wife is null and void. Moreover, to constitute a valid contract, the Civil Code requires the concurrence of the cause, object, and consent, the last element being indubitably absent in the case at bar. On Issue No. 2 No. The Court held that a void contract cannot be ratified. Art. 1390 of the Civil Code provides, the Deed to Transfer of Rights cannot be ratified, even by an "amicable settlement". Although the said settlement was considered a contract, it is a direct offshoot of a void contract. Art. 1422 of the Civil Code provides that a contract which is the direct result of a previous illegal contract is also void and inexistent. Consequently, both the Deed of transfer of Rights and the "amicable settlement" are null and void. G.R. No. L-57499 June 22, 1984 CALIMLIM- CANULLAS vs. FORTUN FACTS: Petitioner Mercedes Calimlim-Canullas was married to Fernando Canullas. They have children and lived in the residential land in question which Fernando inherited the land after his father died. Years after, Fernando abandoned his family and was living with private

respondent Corazon. (Both were convicted of concubinage in a judgment rendered the Court of First Instance which has become final during the pendency of this petition.) Fernado sold the said inherited land with the house thereon to Corazon. Unable to take possession of the said property, Corazon filed a complaint for quieting of title and damages against Mercedes. However, Mercedes claimed that the sale of the land, with the house and improvements, was null and void because they are conjugal properties and she had not given her consent. Respondent Court (Fortun as judge) principally declared Corazon as the lawful owner of the land in question and 1/2 of the house erected on said land. Upon reconsideration prayed for by Mercedes, respondent Court amended its decision and resolved that indeed Corazon was the true and lawful owner of the land but declared the sale of the conjugal house and improvements null and void. ISSUES: 1. WON the construction of a conjugal house on the exclusive property of the husband ipso facto gave the land the character of conjugal property. 2. WON the sale of the lot together with the house and improvements thereon was valid. HELD: On Issue No. 1 No. Second paragraph of Article 158 of the Civil Code reads: Buildings constructed at the expense of the

partnership during the marriage on land belonging to one of the spouses also pertain to the partnership, but the value of the land shall be reimbursed to the spouse who owns the same. The Court ruled that both the land and the building belong to the conjugal partnership but the conjugal partnership is indebted to the husband for the value of the land. The spouse owning the lot becomes a creditor of the conjugal partnership for the value of the lot, which value would be reimbursed at the liquidation of the conjugal partnership. On Issue No. 2 No. Article 1409 of the Civil Code states inter alia that: contracts whose cause, object, or purpose is contrary to law, morals, good customs, public order, or public policy are void and inexistent from the very beginning. Article 1352 also provides that: "Contracts without cause, or with unlawful cause, produce no effect whatsoever. The cause is unlawful if it is contrary to law, morals, good customs, public order, or public policy." In the case at bar, the sale was made by a husband in favor of a concubine after he had abandoned his family and left the conjugal home where his wife and children lived and from whence they derived their support. It was subversive of the stability of the family, a basic social institution which public policy cherishes and protects. Hence, the Court ruled that the sale is null and void being contrary to morals and public policy. Additionally, the law emphatically prohibits the spouses (also include

couples living as husband and wife without benefit of marriage) from selling and donating property to each other during marriage subject to certain exceptions. Such prohibitions were also designed to prevent the exercise of undue influence by one spouse over the other, as well as to protect the institution of marriage, which is the cornerstone of family law. G.R. NO. 122544 JANUARY 28, 1999 REGINA DIZON ET AL V. CA AND OVERLAND EXPRESS LINES, INC. FACTS: Overland Express Lines, Inc. entered into a Contract of Lease with Option to Buy with petitioners involving a 1,755.80 square meter parcel of land situated at corner MacArthur Highway and South H Street, Diliman, Quezon City. The term of the lease was for 1 year commencing from May 16,1974 up to May 15, 1975. During this period, Overland Express Lines was granted an option to purchase for the amount of P3,000.00 per square meter. Thereafter, the lease shall be on a per month basis with a monthly rental of P3,000.00. For failure of Overland Express Lines to pay the increased rental of P8,000.00 per month effective June 1976, petitioners filed an action for ejectment against it. The lower court rendered judgment ordering Overland Express Lines to vacate the leased premises and to pay the sum of P624,000.00representing rentals in arrears and/or as damages in the form of reasonable compensation for the use and occupation of the premises during the period of illegal detainer from June 1976 to November1982 at the monthly rental of P8,000.00, less payments made, plus 12% interest per annum from

November 18, 1976, the date of filing of the complaint, until fully paid, the sum of P8,000.00 a month starting December 1982, until Overland Express Lines fully vacates the premises, and to payP20,000.00 as and by way of attorneys fees. ISSUE: WON Overland Express Lines actually paid the alleged P300,000.00 to Fidela Dizon, as representative (agent) of petitioners in consideration of the option HELD: No. CA opined that the payment by Overland Express Lines of P300,000.00 as partial payment for the leased property, which petitioners accepted (through Alice A. Dizon) and for which an official receipt was issued, was the operative act that gave rise to a perfected contract of sale, and that for failure of petitioners to deny receipt thereof, Overland Express Lines can therefore assume that Alice A. Dizon, acting as agent of petitioners, was authorized by them to receive the money in their behalf.CA went further by stating that in fact, what was entered into was a conditional contract of sale wherein ownership over the leased property shall not pass to the Overland Express Lines until it has fully paid the purchase price. Since Overland Express Lines did not consign to the court the balance of the purchase price and continued to occupy the subject premises, it had the obligation to pay theamount of P1,700.00 in monthly rentals until full payment of the purchase price. In an attempt to resurrect the lapsed option, Overland Express Lines gave

P300,000.00 to petitioners(thru Alice A. Dizon) on the erroneous presumption that the said amount tendered would constitute a perfected contract of sale pursuant to the contract of lease with option to buy. There was no valid consent by the petitioners (as co-owners of the leased premises) on the supposed sale entered intoby Alice A. Dizon, as petitioners alleged agent, and Overland Express Lines. The basis for agency is representation and a person dealing with an agent is put upon inquiry and must discover upon his peril the authority of the agent. As provided in Article 1868 of the New Civil Code, there was no showing that petitioners consented to the act of Alice A. Dizon nor authorized her to act on theirbehalf with regard to her transaction with private respondent. The most prudent thing privaterespondent should have done was to ascertain the extent of the authority of Alice A. Dizon. Beingnegligent in this regard, private respondent cannot seek relief on the basis of a supposed agency. Every person dealing with an agent is put upon inquiry and must discover upon his peril t h e authority of the agent. If he does not make such inquiry, he is chargeable with knowledge of theagents authority, and his ignorance of that authority will not be any excuse. Persons dealing with anassumed agency, whether the assumed agency be a general or special one, are bound at their peril,if they would hold the principal, to ascertain not only the fact of the agency but also the nature andextent of the authority, and in case either is controverted, the burden of proof is upon them to establish it.

GR NO. 137290, JULY 31, 2000 SAN MIGUEL PROPERTIES VS. SPS. HUANG FACTS: San Miguel Properties is engaged in the purchase and sale of real properties, of which include two parcels of land. These properties were offered for sale at P52,140,000.00. Such offer was made to Atty. Dauz on behalf of Sps. Huang. Atty. Dauz wrote San Miguel informing the respondents interest to buy the property and enclosed therein a check (P1,000,000.00) as earnest deposit subject to certain conditions, to wit: (1) that they be given the exclusive option to purchase the property within 30 days from acceptance of the offer; (2) that during the option period, the parties would negotiate the terms and conditions of the purchase; and (3) petitioner would secure the necessary approvals while respondents would handle the documentation. Sobrecarey, San Miguel Properties VP indicated his conformity to the offer; signed the letter; and accepted the earnest deposit. By agreement of the parties, they agreed that respondents will be given 6 months within which to pay. Upon failure of respondents to pay despite the extension of time given, petitioner through its Pres & CEO Gonzales, wrote Atty. Dauz, that they are returning the earnest deposit. Respondent spouses through counsel, wrote petitioner demanding the execution of a deed of conveyance in their favor. They attempted to return the earnest deposit but was refused by San Miguel. Respondent spouses

filed a complaint for specific performance. Trial court, upon motion, dismissed the complaint, which was reversed by the CA. Arguments: San Miguel: the Court of Appeals erred in finding that there was a perfected contract of sale between the parties because the letter of respondents, which petitioner accepted, merely resulted in an option contract, albeit it was unenforceable for lack of a distinct consideration. Petitioner argues that the absence of agreement as to the mode of payment was fatal to the perfection of the contract of sale. Petitioner also disputes the appellate courts ruling that Isidro A. Sobrecarey had authority to sell the subject real properties. Sps. Huang: As held by CA, there is a perfected contract of sale since the earnest money was allegedly given by respondents and accepted by petitioner through its vice-president and operations manager, Sobrecarey. The Court holds that respondents did not give the P1 million as "earnest money" as provided by Art. 1482 of the Civil Code. They presented the amount merely as a deposit of what would eventually become the earnest money or downpayment should a contract of sale be made by them. The amount was thus given not as a part of the purchase price and as proof of the perfection of the contract of sale but only as a guarantee that respondents would not back out of the sale. Respondents in fact described the amount as an "earnest-deposit. ISSUE: WON the earnest deposit could have been given as earnest money

contemplated in Art. 1482, and thus there was a perfected contract of sale. HELD: No, hence, there was no perfected contract of sale. In the present case, the P1 million "earnest-deposit" could not have been given as earnest money as contemplated in Art. 1482 because, at the time when petitioner accepted the terms of respondents offer, their contract had not yet been perfected. The first condition for an option period of 30 days sufficiently shows that a sale was never perfected. Such option giving respondents the exclusive right to buy the properties within the period agreed upon is separate and distinct from the contract of sale which the parties may enter.