ZENAIDA M. SANTOS, petitioner, vs.

CALIXTO SANTOS, ALBERTO

SANTOS, ROSA SANTOS-CARREON and ANTONIO
SANTOS, respondents.

DECISION
QUISUMBING, J.:

This petition for review[1] seeks to annul and set aside the decision dated March 10, 1998
of the Court of Appeals that affirmed the decision of the Regional Trial Court of Manila,
Branch 48, dated March 17, 1993. Petitioner also seeks to annul the resolution that denied her
motion for reconsideration.
Petitioner Zenaida M. Santos is the widow of Salvador Santos, a brother of private
respondents Calixto, Alberto, Antonio, all surnamed Santos and Rosa Santos-Carreon.
The spouses Jesus and Rosalia Santos owned a parcel of land registered under TCT No.
27571 with an area of 154 square meters, located at Sta. Cruz Manila. On it was a four-door
apartment administered by Rosalia who rented them out. The spouses had five children,
Salvador, Calixto, Alberto, Antonio and Rosa.
On January 19, 1959, Jesus and Rosalia executed a deed of sale of the properties in favor
of their children Salvador and Rosa. TCT No. 27571 became TCT No. 60819. Rosa in turn sold
her share to Salvador on November 20, 1973 which resulted in the issuance of a new TCT No.
113221. Despite the transfer of the property to Salvador, Rosalia continued to lease and receive
rentals from the apartment units.
On November 1, 1979, Jesus died. Six years after or on January 9, 1985, Salvador died,
followed by Rosalia who died the following month. Shortly after, petitioner Zenaida, claiming
to be Salvadors heir, demanded the rent from Antonio Hombrebueno,[2] a tenant of
Rosalia. When the latter refused to pay, Zenaida filed an ejectment suit against him with the
Metropolitan Trial Court of Manila, Branch 24, which eventually decided in Zenaidas favor.
On January 5, 1989, private respondents instituted an action for reconveyance of property
with preliminary injunction against petitioner in the Regional Trial Court of Manila, where
they alleged that the two deeds of sale executed on January 19, 1959 and November 20, 1973
were simulated for lack of consideration. They were executed to accommodate Salvador in
generating funds for his business ventures and providing him with greater business flexibility.
In her Answer, Zenaida denied the material allegations in the complaint and as special and
affirmative defenses, argued that Salvador was the registered owner of the property, which
could only be subjected to encumbrances or liens annotated on the title; that the respondents
right to reconveyance was already barred by prescription and laches; and that the complaint
stated no cause of action.
On March 17, 1993, the trial court decided in private respondents favor, thus:

WHEREFORE, viewed from all the foregoing considerations, judgment is hereby

made in favor of the plaintiffs and against the defendants:
a) Declaring Exh. B, the deed of sale executed by Rosalia Santos and Jesus Santos
on January 19, 1959, as entirely null and void for being fictitious or simulated and
inexistent and without any legal force and effect;

b) Declaring Exh. D, the deed of sale executed by Rosa Santos in favor of Salvador
Santos on November 20, 1973, also as entirely null and void for being likewise
fictitious or simulated and inexistent and without any legal force and effect;

c) Directing the Register of Deeds of Manila to cancel Transfer Certificate of Title

No. T-113221 registered in the name of Salvador Santos, as well as, Transfer
Certificate of Title No. 60819 in the names of Salvador Santos, Rosa Santos, and
consequently thereafter, reinstating with the same legal force and effect as if the
same was not cancelled, and which shall in all respects be entitled to like faith and
credit; Transfer Certificate of Title No. T-27571 registered in the name of Rosalia
A. Santos, married to Jesus Santos, the same to be partitioned by the heirs of the
said registered owners in accordance with law; and

d) Making the injunction issued in this case permanent.

Without pronouncement as to costs.

SO ORDERED. [3]

The trial court reasoned that notwithstanding the deeds of sale transferring the property to
Salvador, the spouses Rosalia and Jesus continued to possess the property and to exercise rights
of ownership not only by receiving the monthly rentals, but also by paying the realty
taxes. Also, Rosalia kept the owners duplicate copy of the title even after it was already in the
name of Salvador. Further, the spouses had no compelling reason in 1959 to sell the property
and Salvador was not financially capable to purchase it. The deeds of sale were therefore
fictitious. Hence, the action to assail the same does not prescribe.[4]
Upon appeal, the Court of Appeals affirmed the trial courts decision dated March 10,
1998. It held that in order for the execution of a public instrument to effect tradition, as provided
in Article 1498 of the Civil Code,[5] the vendor shall have had control over the thing sold, at the
moment of sale. It was not enough to confer upon the purchaser the ownership and the right of
possession. The thing sold must be placed in his control. The subject deeds of sale did not
confer upon Salvador the ownership over the subject property, because even after the sale, the
original vendors remained in dominion, control, and possession thereof. The appellate court
further said that if the reason for Salvadors failure to control and possess the property was due
to his acquiescence to his mother, in deference to Filipino custom, petitioner, at least, should
have shown evidence to prove that her husband declared the property for tax purposes in his
name or paid the land taxes, acts which strongly indicate control and possession. The appellate
court disposed:

WHEREFORE, finding no reversible error in the decision appealed from, the same
is hereby AFFIRMED. No pronouncement as to costs.

SO ORDERED. [6]
 Hence, this petition where petitioner avers that the Court of Appeals erred in:
I.

...HOLDING THAT THE OWNERSHIP OVER THE LITIGATED PROPERTY

BY THE LATE HUSBAND OF DEFENDANT-APPELLANT WAS AFFECTED
BY HIS FAILURE TO EXERCISE CERTAIN ATTRIBUTES OF OWNERSHIP.
II

...HOLDING THAT DUE EXECUTION OF A PUBLIC INSTRUMENT IS NOT

EQUIVALENT TO DELIVERY OF THE LAND IN DISPUTE.
III

...NOT FINDING THAT THE CAUSE OF ACTION OF ROSALIA SANTOS

HAD PRESCRIBED AND/OR BARRED BY LACHES.
IV

...IGNORING PETITIONERS ALLEGATION TO THE EFFECT THAT

PLAINTIFF DR. ROSA [S.] CARREON IS NOT DISQUALIFIED TO TESTIFY
AS TO THE QUESTIONED DEEDS OF SALE CONSIDERING THAT
SALVADOR SANTOS HAS LONG BEEN DEAD. [7]

In this petition, we are asked to resolve the following:

1. Are payments of realty taxes and retention of possession indications of continued
ownership by the original owners?
2. Is a sale through a public instrument tantamount to delivery of the thing sold?
3. Did the cause of action of Rosalia Santos and her heirs prescribe?
4. Can petitioner invoke the Dead Mans Statute?[8]
On the first issue, petitioner contends that the Court of Appeals erred in holding that
despite the deeds of sale in Salvadors favor, Jesus and Rosalia still owned the property because
the spouses continued to pay the realty taxes and possess the property. She argues that tax
declarations are not conclusive evidence of ownership when not supported by evidence. She
avers that Salvador allowed his mother to possess the property out of respect to her in
accordance with Filipino values.
It is true that neither tax receipts nor declarations of ownership for taxation purposes
constitute sufficient proof of ownership. They must be supported by other effective
proofs.[9] These requisite proofs we find present in this case. As admitted by petitioner, despite
the sale, Jesus and Rosalia continued to possess and administer the property and enjoy its fruits
by leasing it to third persons.[10] Both Rosa and Salvador did not exercise any right of ownership
over it.[11] Before the second deed of sale to transfer her 1/2 share over the property was executed
by Rosa, Salvador still sought the permission of his mother.[12] Further, after Salvador registered
the property in his name, he surrendered the title to his mother.[13] These are clear indications
that ownership still remained with the original owners. In Serrano vs. CA, 139 SCRA 179, 189
(1985), we held that the continued collection of rentals from the tenants by the seller of realty
after execution of alleged deed of sale is contrary to the notion of ownership.
Petitioner argues that Salvador, in allowing her mother to use the property even after the
sale, did so out of respect for her and out of generosity, a factual matter beyond the province
of this Court.[14] Significantly, in Alcos vs. IAC, 162 SCRA 823, 837 (1988), we noted that the
buyers immediate possession and occupation of the property corroborated the truthfulness and
authenticity of the deed of sale. Conversely, the vendors continued possession of the property
makes dubious the contract of sale between the parties.
On the second issue, is a sale through a public instrument tantamount to delivery of the
thing sold? Petitioner in her memorandum invokes Article 1477[15] of the Civil Code which
provides that ownership of the thing sold is transferred to the vendee upon its actual or
constructive delivery. Article 1498, in turn, provides that when the sale is made through a
public instrument, its execution is equivalent to the delivery of the thing subject of the
contract. Petitioner avers that applying said provisions to the case, Salvador became the owner
of the subject property by virtue of the two deeds of sale executed in his favor.
Nowhere in the Civil Code, however, does it provide that execution of a deed of sale is a
conclusive presumption of delivery of possession. The Code merely said that the execution
shall be equivalent to delivery. The presumption can be rebutted by clear and convincing
evidence.[16] Presumptive delivery can be negated by the failure of the vendee to take actual
possession of the land sold.[17]
In Danguilan vs. IAC, 168 SCRA 22, 32 (1988), we held that for the execution of a public
instrument to effect tradition, the purchaser must be placed in control of the thing sold. When
there is no impediment to prevent the thing sold from converting to tenancy of the purchaser
by the sole will of the vendor, symbolic delivery through the execution of a public instrument
is sufficient. But if, notwithstanding the execution of the instrument, the purchaser cannot have
the enjoyment and material tenancy nor make use of it himself or through another in his name,
then delivery has not been effected.
As found by both the trial and appellate courts and amply supported by the evidence on
record, Salvador was never placed in control of the property. The original sellers retained their
control and possession. Therefore, there was no real transfer of ownership.
Moreover, in Norkis Distributors, Inc. vs. CA, 193 SCRA 694, 698-699 (1991), citing the
land case of Abuan vs. Garcia, 14 SCRA 759 (1965), we held that the critical factor in the
different modes of effecting delivery, which gives legal effect to the act is the actual intention
of the vendor to deliver, and its acceptance by the vendee. Without that intention, there is no
tradition. In the instant case, although the spouses Jesus and Rosalia executed a deed of sale,
they did not deliver the possession and ownership of the property to Salvador and Rosa. They
agreed to execute a deed of sale merely to accommodate Salvador to enable him to generate
funds for his business venture.
On the third issue, petitioner argues that from the date of the sale from Rosa to Salvador
on November 20, 1973, up to his death on January 9, 1985, more or less twelve years had
lapsed, and from his death up to the filing of the case for reconveyance in the court a quo on
January 5, 1989, four years had lapsed. In other words, it took respondents about sixteen years
to file the case below. Petitioner argues that an action to annul a contract for lack of
consideration prescribes in ten years and even assuming that the cause of action has not
prescribed, respondents are guilty of laches for their inaction for a long period of time.
 Has respondents cause of action prescribed? In Lacsamana vs. CA, 288 SCRA 287, 292
(1998), we held that the right to file an action for reconveyance on the ground that the certificate
of title was obtained by means of a fictitious deed of sale is virtually an action for the
declaration of its nullity, which does not prescribe. This applies squarely to the present
case. The complaint filed by respondents in the court a quo was for the reconveyance of the
subject property to the estate of Rosalia since the deeds of sale were simulated and
fictitious. The complaint amounts to a declaration of nullity of a void contract, which is
imprescriptible. Hence, respondents cause of action has not prescribed.
Neither is their action barred by laches. The elements of laches are: 1) conduct on the part
of the defendant, or of one under whom he claims, giving rise to the situation of which the
complaint seeks a remedy; 2) delay in asserting the complainants rights, the complainant
having had knowledge or notice of the defendants conduct as having been afforded an
opportunity to institute a suit; 3) lack of knowledge or notice on the part of the defendant that
the complainant would assert the right in which he bases his suit; and 4) injury or prejudice to
the defendant in the event relief is accorded to the complainant, or the suit is not held
barred.[18] These elements must all be proved positively. The conduct which caused the
complaint in the court a quo was petitioners assertion of right of ownership as heir of
Salvador. This started in December 1985 when petitioner demanded payment of the lease
rentals from Antonio Hombrebueno, the tenant of the apartment units. From December 1985
up to the filing of the complaint for reconveyance on January 5, 1989, only less than four years
had lapsed which we do not think is unreasonable delay sufficient to bar respondents cause of
action. We likewise find the fourth element lacking. Neither petitioner nor her husband made
considerable investments on the property from the time it was allegedly transferred to the
latter. They also did not enter into transactions involving the property since they did not claim
ownership of it until December 1985. Petitioner stood to lose nothing. As we held in the same
case of Lacsamana vs. CA, cited above, the concept of laches is not concerned with the lapse
of time but only with the effect of unreasonable lapse. In this case, the alleged 16 years of
respondents inaction has no adverse effect on the petitioner to make respondents guilty of
laches.
Lastly, petitioner in her memorandum seeks to expunge the testimony of Rosa Santos-
Carreon before the trial court in view of Sec. 23, Rule 130 of the Revised Rules of Court,
otherwise known as the Dead Mans Statute.[19] It is too late for petitioner, however, to invoke
said rule. The trial court in its order dated February 5, 1990, denied petitioners motion to
disqualify respondent Rosa as a witness. Petitioner did not appeal therefrom. Trial ensued and
Rosa testified as a witness for respondents and was cross-examined by petitioners counsel. By
her failure to appeal from the order allowing Rosa to testify, she waived her right to invoke the
dead mans statute. Further, her counsel cross-examined Rosa on matters that occurred during
Salvadors lifetime. In Goi vs. CA, 144 SCRA 222, 231 (1986), we held that protection under
the dead mans statute is effectively waived when a counsel for a petitioner cross-examines a
private respondent on matters occurring during the deceaseds lifetime. The Court of Appeals
cannot be faulted in ignoring petitioner on Rosas disqualification.
WHEREFORE, the instant petition is DENIED. The assailed decision dated March 10,
1998 of the Court of Appeals, which sustained the judgment of the Regional Trial Court dated
March 17, 1993, in favor of herein private respondents, is AFFIRMED. Costs against
petitioner.
SO ORDERED.
Bellosillo, (Chairman), Mendoza, Buena, and De Leon, Jr., JJ., concur.