Estate Tax Cases
Estate Tax Cases
Estate Tax Cases
Prof.Calayan
Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
DECISION
Before the Court is a petition for review on certiorari under Rule 45 of the 1997 Rules of Civil
Procedure, as amended, seeking to annul and set aside the Decision1 dated June 26, 2003 and
Resolution2 dated January 15, 2004 of the Court of Appeals (CA) in CA-G.R. CV No. 61888.
The CA had reversed the Decision3 dated August 3, 1998 of the Regional Trial Court (RTC) of
Malolos, Bulacan, Branch 11, in Civil Case No. 819-M-93 and dismissed petitioners’ complaint
on the ground of prescription.
When Antonio Feliciano passed away on May 20, 1930, he left behind his only property, a parcel
of land located at Bunga4 Mayor, Bustos, Bulacan. The land had an area of 1,125 square meters
and was evidenced by Tax Declaration No. 14025 in his name. On March 28, 1972, Leona,
Maria, Pedro and Salina, all surnamed Feliciano, declared themselves to be the only surviving
heirs of Antonio Feliciano, with the exception of Salina. They executed an extrajudicial
settlement of Antonio Feliciano’s estate6 and appropriated among themselves the said parcel of
land, to the exclusion of the heirs of Esteban Feliciano and Doroteo Feliciano, deceased children
of Antonio Feliciano. On even date, Leona, Maria, Pedro and Salina executed a deed of absolute
sale or Kasulatan sa Ganap Na Bilihan over the property in favor of the late Jacinto Feliciano
(Pedro’s portion), Felisa Feliciano (Salina’s portion) and Pedro Canoza (Leona and Maria’s
portions).7
During his lifetime, Jacinto Feliciano applied for a free patent over the portion of land he bought,
declaring that the same was a public land, first occupied and cultivated by Pedro Feliciano.8
Jacinto was issued Free Patent No. (IV-4) 012293 on November 28, 19779 and the same was
forwarded to the Register of Deeds of Malolos, Bulacan, but unfortunately, it was burned on
March 7, 1987. Pedro Canoza, for his part, also applied for a free patent over the portion of land
which he bought, claiming that the same was public land, first occupied and cultivated by Leona
and Maria Feliciano.10 He was issued Free Patent No. (IV-4) 012292, now covered by Original
Certificate of Title (OCT) No. P-364,11 on February 23, 1979.
On October 18, 1993, Eugenio Feliciano and Angelina Feliciano-de Leon, surviving heirs of the
late Esteban Feliciano, and Trinidad Feliciano-Valiente and Basilia Feliciano-Trinidad, surviving
children of the late Doroteo Feliciano, filed a complaint12 against Salina Feliciano, Felisa
Feliciano, Pedro Canoza and the heirs of the late Jacinto Feliciano, namely Delia, Rosauro, Elsa,
Nardo and Ponciano, all surnamed Feliciano, for the Declaration of Nullity of Documents and
Title, Recovery of Real Property and Damages. They alleged that the settlement of the estate and
sale were done without their participation and consent as heirs of Esteban and Doroteo.
Likewise, they averred that the ancestral home of the Felicianos is erected on the subject
property and that they have occupied the same since birth. Canoza and Jacinto falsely declared
that the property was not occupied, so their titles to the property should be declared null and void
on the ground that they have made false statements in their respective applications for free
patent.
On November 4, 1993, before an Answer could be filed, the petitioners amended their complaint
to include the allegation that they sought to recover the shares of their fathers, Esteban and
Doroteo, which they could have acquired as heirs of Antonio Feliciano.13
In their Answer,14 respondent Pedro Canoza and his spouse, respondent Delia Feliciano, alleged
that they were buyers in good faith and for value. They likewise contended that assuming that
there was preterition of legal heirs, they never took part in it. As affirmative defenses, they
alleged that the complaint failed to state a cause of action; the lower court had no jurisdiction as
the subject of the case were free patents and therefore prior exhaustion of administrative
remedies was required; the case was prematurely filed; no effort was exerted towards a
settlement; plaintiffs’ right has prescribed; Eugenio Feliciano was a mere squatter who should be
ordered to vacate; the deed of sale was validly, genuinely and duly executed; Eugenio and
Angelina were guilty of misleading the court because there were other heirs who were
indispensable parties but who were not included; and Presidential Decree No. 1508 or the
Revised Katarungang Pambarangay Law was not resorted to by plaintiffs.
Respondents Rosauro Feliciano, Elsa Feliciano and Ponciano Feliciano likewise filed an
Answer15 containing the same allegations and defenses as respondents Pedro Canoza and Delia
Feliciano. The other defendants, Salina Feliciano, Felisa Feliciano and Nardo Feliciano were
declared in default.
On August 3, 1998, the trial court rendered a Decision, the dispositive portion of which reads as
follows:
WHEREFORE, judgment is hereby rendered in favor of the plaintiffs and against the defendants,
as follows:
1. Declaring the extra-judicial settlement of estate of Antonio Feliciano null and void;
2. Declaring the sale of the property in question to Pedro Canoza, Felisa Feliciano and
Jacinto Feliciano null and void;
3. Declaring the original certificate of Title No. 364 in the name of Pedro Canoza and the
certificates of titles in the name of defendants over Lot 1874-Cad-344, Bustos Cadastre
(Tax Declaration No. 1402) as null and void;
No pronouncement as to cost.
SO ORDERED.16
The trial court explained that by operation of law, the plaintiffs (herein petitioners) have as much
right as Leona, Maria, Pedro and Salina Feliciano to inherit the property in question, and they
cannot be deprived of their right unless by disinheritance for causes set forth in the law. When
Leona Feliciano, Pedro Feliciano, Maria Feliciano and Salina Feliciano appropriated the disputed
lot solely to themselves through the extrajudicial settlement of estate, they committed a
fraudulent act. To the extent that Doroteo and Esteban were deprived of their rightful share, the
said out-of-court settlement was annullable, said the trial court. The trial court also declared that
Pedro Canoza was not a buyer in good faith of Leona and Maria’s shares. Records show that
Pedro Canoza’s live-in partner, Delia Feliciano, was a relative of the petitioners and the other
defendants; thus, he could be reasonably charged with the knowledge of petitioners’ status vis-à-
vis the subject property. The acquisition by Canoza and Jacinto Feliciano of free patent titles
over portions of the contested lot also did not legitimize their ownership thereof, as they acquired
no greater rights over the property than their predecessors-in-interest, having merely stepped into
their shoes.17
On June 26, 2003, the appellate court rendered the assailed Decision reversing the trial court’s
decision. The CA held,
SO ORDERED.19
The CA ruled that prescription had set in, citing the case of Pedrosa v. Court of Appeals,20 which
held that the applicable prescriptive period to annul a deed of extrajudicial settlement is four (4)
years from the discovery of the fraud. It reasoned that when petitioners filed the instant
complaint for the annulment of the extrajudicial settlement of Antonio Feliciano’s estate, more
than four (4) years had elapsed from the issuance of the free patents. As regards the portion
claimed by the late Jacinto Feliciano, sixteen (16) years had elapsed from the time the free patent
was issued to him before petitioners filed the complaint, while in the case of Canoza, fourteen
(14) years had elapsed from the issuance of the free patent in Canoza’s favor. Hence, according
to the CA, the action for the annulment of the documents had prescribed.
Petitioners filed a motion for reconsideration of the aforesaid Decision but it was denied by the
CA in the Resolution dated January 15, 2004 for lack of merit.
Essentially, the issue for our resolution is whether the CA erred in reversing the trial court’s
decision.
Petitioners allege that the CA gravely erred in granting the appeal and in dismissing the
complaint on the ground of prescription of action because that issue was never raised on appeal,
nor defined as one (1) of the issues outlined and limited in the pre-trial order.
We do not agree.
While respondents have not assigned the defense of prescription in their appeal before the CA,
they raised such defense in their December 1, 1993 Answer as one (1) of their affirmative
defenses.22 In their brief before the CA, respondents specifically prayed for the reliefs mentioned
in their respective answers before the trial court. Thus, by reference, they are deemed to have
adopted the defense of prescription, and could not properly be said to have waived the defense of
prescription.
Moreover, Rule 9, Section 1 of the 1997 Rules of Civil Procedure, as amended, provides that
when it appears from the pleadings or the evidence on record that the action is already barred by
the statute of limitations, the court shall dismiss the claim. Thus, in Gicano v. Gegato,23 we held:
We have ruled that trial courts have authority and discretion to dismiss an action on the ground
of prescription when the parties’ pleadings or other facts on record show it to be indeed time-
barred x x x; and it may do so on the basis of a motion to dismiss, or an answer which sets up
such ground as an affirmative defense; or even if the ground is alleged after judgment on the
merits, as in a motion for reconsideration; or even if the defense has not been asserted at all, as
where no statement thereof is found in the pleadings, or where a defendant has been declared in
default. What is essential only, to repeat, is that the facts demonstrating the lapse of the
prescriptive period, be otherwise sufficiently and satisfactorily apparent on the record: either in
the averments of the plaintiffs complaint, or otherwise established by the evidence.
(Underscoring supplied.)
But did the CA nonetheless commit error when it held that the applicable prescriptive period is
four (4) years?
Petitioners argue that the CA erroneously treated the action they filed at the trial court as one (1)
for annulment of the extrajudicial settlement and applied the four (4)-year prescriptive period in
dismissing the same. They contend that the action they filed was one (1) for Declaration of
Nullity of Documents and Titles, Recovery of Real Property and Damages, and as such, their
action was imprescriptible pursuant to Article 141024 of the Civil Code.
Respondents, for their part, maintain that the CA did not err in holding that the deed of
extrajudicial partition executed without including some of the heirs, who had no knowledge of
the partition and did not consent thereto, is merely fraudulent and not void. They stress that the
action to rescind the partition based on fraud prescribes in four (4) years counted from the date of
registration, which is constructive notice to the whole world.
We affirm the ruling of the CA. As the records show, the heirs of Doroteo and Esteban did not
participate in the extrajudicial partition executed by Salina with the other compulsory heirs,
Leona, Maria and Pedro. Undeniably, the said deed was fraudulently obtained as it deprived the
known heirs of Doroteo and Esteban of their shares in the estate. A deed of extrajudicial partition
executed without including some of the heirs, who had no knowledge of and consent to the same,
is fraudulent and vicious.25 Hence, an action to set it aside on the ground of fraud could be
instituted. Such action for the annulment of the said partition, however, must be brought within
four (4) years from the discovery of the fraud.1avvphi1
Evidently, the applicable prescriptive period to institute the action to annul the deed of
extrajudicial settlement was four (4) years counted from the discovery of fraud as held in the
case of Gerona v. De Guzman.28 However, the records show that petitioners’ complaint was filed
only on October 18, 1993, or almost sixteen (16) years after Jacinto Feliciano was issued Free
Patent No. (IV-4) 012293 on November 28, 1977, and almost fourteen (14) years from the time
Pedro Canoza was issued OCT No. P-364 on November 28, 1979. As petitioners are deemed to
have obtained constructive notice of the fraud upon the registration of the Free Patent, they
clearly failed to institute the present civil action within the allowable period. The same result
obtains even if their complaint is treated as one (1) essentially for reconveyance as more than ten
(10) years have passed since petitioners’ cause of action accrued. The CA committed no error in
dismissing their complaint.
WHEREFORE, the petition for review on certiorari is DENIED. The Decision dated June 26,
2003 and Resolution dated January 15, 2004, of the Court of Appeals in CA-G.R. CV No. 61888
are AFFIRMED.
With costs against petitioners.
SO ORDERED.
WE CONCUR:
ATTESTATION
I attest that the conclusions in the above Decision had been reached in consultation before the
case was assigned to the writer of the opinion of the Court’s Division.
CERTIFICATION
Pursuant to Section 13, Article VIII of the 1987 Constitution and the Division Chairperson’s
Attestation, I certify that the conclusions in the above Decision had been reached in consultation
before the case was assigned to the writer of the opinion of the Court’s Division.
RENATO C. CORONA
Chief Justice
1. Source: http://www.lawphil.net/judjuris/juri2010/sep2010/gr_161746_2010.html
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
RESOLUTION
NACHURA, J.:
This petition for review on certiorari seeks to set aside the Court of Appeals (CA) Decision1
dated February 21, 2008, which dismissed petitioner’s action to enforce payment of a promissory
note issued by respondent, and Resolution2 dated July 9, 2008, which denied petitioner’s motion
for reconsideration.
On January 10, 2002, Pacifico S. Brobio (Pacifico) died intestate, leaving three parcels of land.
He was survived by his wife, respondent Eufrocina A. Brobio, and four legitimate and three
illegitimate children; petitioner Carmela Brobio Mangahas is one of the illegitimate children.
On May 12, 2002, the heirs of the deceased executed a Deed of Extrajudicial Settlement of
Estate of the Late Pacifico Brobio with Waiver. In the Deed, petitioner and Pacifico’s other
children, in consideration of their love and affection for respondent and the sum of P150,000.00,
waived and ceded their respective shares over the three parcels of land in favor of respondent.
According to petitioner, respondent promised to give her an additional amount for her share in
her father’s estate. Thus, after the signing of the Deed, petitioner demanded from respondent the
promised additional amount, but respondent refused to pay, claiming that she had no more
money.3
A year later, while processing her tax obligations with the Bureau of Internal Revenue (BIR),
respondent was required to submit an original copy of the Deed. Left with no more original copy
of the Deed, respondent summoned petitioner to her office on May 31, 2003 and asked her to
countersign a copy of the Deed. Petitioner refused to countersign the document, demanding that
respondent first give her the additional amount that she promised. Considering the value of the
three parcels of land (which she claimed to be worth P20M), petitioner asked for P1M, but
respondent begged her to lower the amount. Petitioner agreed to lower it to P600,000.00.
Because respondent did not have the money at that time and petitioner refused to countersign the
Deed without any assurance that the amount would be paid, respondent executed a promissory
note. Petitioner agreed to sign the Deed when respondent signed the promissory note which read
—
31 May 2003
This is to promise that I will give a Financial Assistance to CARMELA B. MANGAHAS the
amount of P600,000.00 Six Hundred Thousand only on June 15, 2003.
(SGD)
EUFROCINA A. BROBIO4
When the promissory note fell due, respondent failed and refused to pay despite demand.
Petitioner made several more demands upon respondent but the latter kept on insisting that she
had no money.
On January 28, 2004, petitioner filed a Complaint for Specific Performance with Damages5
against respondent, alleging in part—
2. That plaintiff and defendant are legal heirs of the deceased, Pacifico S. Brobio[,] who
died intestate and leaving without a will, on January 10, 2002, but leaving several real
and personal properties (bank deposits), and some of which were the subject of the extra-
judicial settlement among them, compulsory heirs of the deceased, Pacifico Brobio. x x x.
3. That in consideration of the said waiver of the plaintiff over the listed properties in the
extra-judicial settlement, plaintiff received the sum of P150,000.00, and the defendant
executed a "Promissory Note" on June 15, 2003, further committing herself to give
plaintiff a financial assistance in the amount of P600,000.00. x x x.
4. That on its due date, June 15, 2003, defendant failed to make good of her promise of
delivering to the plaintiff the sum of P600,000.00 pursuant to her "Promissory Note"
dated May 31, 2003, and despite repeated demands, defendant had maliciously and
capriciously refused to deliver to the plaintiff the amount [of] P600,000.00, and the last
of which demands was on October 29, 2003. x x x.6
In her Answer with Compulsory Counterclaim,7 respondent admitted that she signed the
promissory note but claimed that she was forced to do so. She also claimed that the undertaking
was not supported by any consideration. More specifically, she contended that —
10. Defendant was practically held "hostage" by the demand of the plaintiff. At that time,
defendant was so much pressured and was in [a] hurry to submit the documents to the
Bureau of Internal Revenue because of the deadline set and for fear of possible penalty if
not complied with. Defendant pleaded understanding but plaintiff was adamant. Her hand
could only move in exchange for 1 million pesos.
11. Defendant, out of pressure and confused disposition, was constrained to make a
promissory note in a reduced amount in favor of the plaintiff. The circumstances in the
execution of the promissory note were obviously attended by involuntariness and the
same was issued without consideration at all or for illegal consideration.8
On May 15, 2006, the Regional Trial Court (RTC) rendered a decision in favor of petitioner. The
RTC found that the alleged "pressure and confused disposition" experienced by respondent and
the circumstances that led to the execution of the promissory note do not constitute undue
influence as would vitiate respondent’s consent thereto. On the contrary, the RTC observed that
—
It is clear from all the foregoing that it is the defendant who took improper advantage of the
plaintiff’s trust and confidence in her by resorting to a worthless written promise, which she was
intent on reneging. On the other hand, plaintiff did not perform an unlawful conduct when she
insisted on a written commitment from the defendant, as embodied in the promissory note in
question, before affixing her signature that was asked of her by the defendant because, as already
mentioned, that was the only opportunity available to her or which suddenly and unexpectedly
presented itself to her in order to press her demand upon the defendant to satisfy the correct
amount of consideration due to her. In other words, as the defendant had repeatedly rebuffed her
plea for additional consideration by claiming lack of money, it is only natural for the plaintiff to
seize the unexpected opportunity that suddenly presented itself in order to compel the defendant
to give to her [what is] due [her]. And by executing the promissory note which the defendant had
no intention of honoring, as testified to by her, the defendant clearly acted in bad faith and took
advantage of the trust and confidence that plaintiff had reposed in her.9
The RTC also brushed aside respondent’s claim that the promissory note was not supported by
valuable consideration. The court maintained that the promissory note was an additional
consideration for the waiver of petitioner’s share in the three properties in favor of respondent.
Its conclusion was bolstered by the fact that the promissory note was executed after negotiation
and haggling between the parties. The dispositive portion of the RTC decision reads:
1. Ordering the defendant to pay to plaintiff the sum of Six Hundred Thousand Pesos
(P600,000.00) which she committed to pay to plaintiff under the promissory note in
question, plus interest thereon at the rate of 12% per annum computed from the date of
the filing of the complaint;
2. Ordering the defendant to pay to plaintiff the sum of P50,000.00 as attorney’s fees; and
SO ORDERED.10
On February 21, 2008, the CA reversed the RTC decision and dismissed the complaint.11 The CA
found that there was a complete absence of consideration in the execution of the promissory
note, which made it inexistent and without any legal force and effect. The court noted that
"financial assistance" was not the real reason why respondent executed the promissory note, but
only to secure petitioner’s signature. The CA held that the waiver of petitioner’s share in the
three properties, as expressed in the deed of extrajudicial settlement, may not be considered as
the consideration of the promissory note, considering that petitioner signed the Deed way back in
2002 and she had already received the consideration of P150,000.00 for signing the same. The
CA went on to hold that if petitioner disagreed with the amount she received, then she should
have filed an action for partition.
Further, the CA found that intimidation attended the signing of the promissory note. Respondent
needed the Deed countersigned by petitioner in order to comply with a BIR requirement; and,
with petitioner’s refusal to sign the said document, respondent was forced to sign the promissory
note to assure petitioner that the money promised to her would be paid.
Petitioner moved for the reconsideration of the CA Decision. In a Resolution dated July 9, 2008,
the CA denied petitioner’s motion.12
1. The Honorable Court of Appeals erred in the appreciation of the facts of this case
when it found that intimidation attended the execution of the promissory note subject of
this case.
2. The Honorable Court of Appeals erred when it found that the promissory note was
without consideration.
3. The Honorable Court of Appeals erred when it stated that petitioner should have filed
[an action] for partition instead of a case for specific performance.13
Contracts are voidable where consent thereto is given through mistake, violence, intimidation,
undue influence, or fraud. In determining whether consent is vitiated by any of these
circumstances, courts are given a wide latitude in weighing the facts or circumstances in a given
case and in deciding in favor of what they believe actually occurred, considering the age,
physical infirmity, intelligence, relationship, and conduct of the parties at the time of the
execution of the contract and subsequent thereto, irrespective of whether the contract is in a
public or private writing.14
Nowhere is it alleged that mistake, violence, fraud, or intimidation attended the execution of the
promissory note. Still, respondent insists that she was "forced" into signing the promissory note
because petitioner would not sign the document required by the BIR. In one case, the Court – in
characterizing a similar argument by respondents therein – held that such allegation is
tantamount to saying that the other party exerted undue influence upon them. However, the Court
said that the fact that respondents were "forced" to sign the documents does not amount to
vitiated consent.15
There is undue influence when a person takes improper advantage of his power over the will of
another, depriving the latter of a reasonable freedom of choice.16 For undue influence to be
present, the influence exerted must have so overpowered or subjugated the mind of a contracting
party as to destroy his free agency, making him express the will of another rather than his own.17
Respondent may have desperately needed petitioner’s signature on the Deed, but there is no
showing that she was deprived of free agency when she signed the promissory note. Being forced
into a situation does not amount to vitiated consent where it is not shown that the party is
deprived of free will and choice. Respondent still had a choice: she could have refused to execute
the promissory note and resorted to judicial means to obtain petitioner’s signature. Instead,
respondent chose to execute the promissory note to obtain petitioner’s signature, thereby
agreeing to pay the amount demanded by petitioner.
The fact that respondent may have felt compelled, under the circumstances, to execute the
promissory note will not negate the voluntariness of the act. As rightly observed by the trial
court, the execution of the promissory note in the amount of P600,000.00 was, in fact, the
product of a negotiation between the parties. Respondent herself testified that she bargained with
petitioner to lower the amount:
ATTY. VILLEGAS:
Q And is it not that there was even a bargaining from P1-M to P600,000.00 before you
prepare[d] and [sign[ed] that promissory note marked as Exhibit "C"?
A Yes, sir.
Q And in fact, you were the one [who] personally wrote the amount of P600,000.00 only
as indicated in the said promissory note?
A Yes, sir.
COURT:
Q So, just to clarify. Carmela was asking an additional amount of P1-M for her to sign
this document but you negotiated with her and asked that it be lowered to P600,000.00 to
which she agreed, is that correct?
Q But you negotiated and asked for its reduction from P1-M to P600,000.00?
Contrary to the CA’s findings, the situation did not amount to intimidation that vitiated
consent.1awphil There is intimidation when one of the contracting parties is compelled to give
his consent by a reasonable and well-grounded fear of an imminent and grave evil upon his
person or property, or upon the person or property of his spouse, descendants, or ascendants.19
Certainly, the payment of penalties for delayed payment of taxes would not qualify as a
"reasonable and well-grounded fear of an imminent and grave evil."
We join the RTC in holding that courts will not set aside contracts merely because solicitation,
importunity, argument, persuasion, or appeal to affection was used to obtain the consent of the
other party. Influence obtained by persuasion or argument or by appeal to affection is not
prohibited either in law or morals and is not obnoxious even in courts of equity.20
On the issue that the promissory note is void for not being supported by a consideration, we
likewise disagree with the CA.
Respondent failed to prove that the promissory note was not supported by any consideration.
From her testimony and her assertions in the pleadings, it is clear that the promissory note was
issued for a cause or consideration, which, at the very least, was petitioner’s signature on the
document.1avvphi1
It may very well be argued that if such was the consideration, it was inadequate. Nonetheless,
even if the consideration is inadequate, the contract would not be invalidated, unless there has
been fraud, mistake, or undue influence.23 As previously stated, none of these grounds had been
proven present in this case.
The foregoing discussion renders the final issue insignificant. Be that as it may, we would like to
state that the remedy suggested by the CA is not the proper one under the circumstances. An
action for partition implies that the property is still owned in common.24 Considering that the
heirs had already executed a deed of extrajudicial settlement and waived their shares in favor of
respondent, the properties are no longer under a state of co-ownership; there is nothing more to
be partitioned, as ownership had already been merged in one person.
WHEREFORE, premises considered, the CA Decision dated February 21, 2008 and its
Resolution dated July 9, 2008 are REVERSED and SET ASIDE. The RTC decision dated May
15, 2006 is REINSTATED.
SO ORDERED.
RENATO C. CORONA*
Chief Justice
TERESITA J. LEONARDO-DE
ANTONIO T. CARPIO
CASTRO**
Associate Justice
Associate Justice
ATTESTATION
I attest that the conclusions in the above Resolution had been reached in consultation before the
case was assigned to the writer of the opinion of the Court’s Division.
ANTONIO T. CARPIO
Associate Justice
Chairperson, Second Division
CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution and the Division Chairperson's
Attestation, I certify that the conclusions in the above Resolution had been reached in
consultation before the case was assigned to the writer of the opinion of the Court’s Division.
RENATO C. CORONA
Chief Justice
2.Source: http://www.lawphil.net/judjuris/juri2010/oct2010/gr_183852_2010.html
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
DECISION
PERALTA, J.:
This is a petition for review on certiorari under Rule 45 of the Rules of Court seeking to reverse
and set aside the Decision1 and Resolution2 of the Court of Appeals (CA), dated May 30, 2001
and January 25, 2002, respectively, in CA-G.R. CV No. 46144.
On April 15, 1985, Pedro de Guzman filed a Complaint with application for temporary
restraining order and preliminary injunction against respondents before the Regional Trial Court
(RTC) of Bataan docketed as Civil Case No. 5247. He sought reconveyance of a parcel of land
measuring about 300 square meters from the heirs of Rosauro de Guzman and his surviving
spouse, Angelina Perona.
Pedro alleged that through unlawful machination, fraud, deceit, and evident bad faith, respondent
spouses Rosauro and Angelina caused the cancellation of Original Certificate of Title (OCT) No.
10075 and subdivided the said property into three (3) parcels of land covered by separate
Transfer Certificate of Titles in their name.
Records show that OCT No. 100753 was issued by the Office of the Register of Deeds for the
Province of Bataan on July 25, 1933, containing an area of 3,242 square meters, more or less,
half of which was registered under the name of Andrea de Guzman, and the other half in the
names of Servando de Guzman's children, namely, Pablo (married to Amelia Alarcon), Jose,
Canuto, Cirilo, Leopoldo, David and Maximino.
In 1942, Andrea, Cirilo, Leopoldo and David died intestate. On July 26, 1950, a petition for the
issuance of a new owner's duplicate of OCT No. 10075 was filed by Jose de Guzman, one of the
registered owners, due to the loss of the owner's copy of OCT No. 10075. Pursuant to the Order4
of the Court of First Instance of Bataan, dated August 22, 1950, the Register of Deeds of Bataan
was directed to issue a new owner's duplicate of OCT No. 10075. Thereafter, by virtue of an
Extrajudicial Settlement of Estate5 executed on October 16, 1952 by Pablo, Jose, Canuto,
Veronica Cruz (surviving spouse of Cirilo and in her capacity as legal administratix of their
minor children, Ernesto, Rosauro and Mercedita), Rogelio and Maximino, wherein they agreed
to divide and adjudicate among themselves, in equal parts, the property covered by OCT No.
10075, the latter title was canceled and TCT No. T-3885 was issued in its stead. TCT No. T-
3885 was later on divided into three parcels of land covered by TCT Nos. 78181, 78182 and
78183.
TCT No. 78181,6 registered in the name of the spouses Rosauro and Angelina, was mortgaged by
the said Spouses to Bataan Development Bank (BD Bank) on March 25, 1980.7 Due to the
failure of the Spouses to pay their indebtedness to BD Bank, the mortgaged property was
foreclosed and sold to the bank as the highest bidder.
TCT No. 78182,8 also registered in the name of the spouses Rosauro and Angelina, was sold by
the said Spouses to a certain Carlito Pangilinan and Candida Ramos by virtue of a Kasulatan ng
Bilihang Tuluyan,9 dated August 12, 1982. By virtue of the sale, TCT No. 78182 was canceled
and superseded by TCT No. 105347.
TCT No. 7818310 in the name of Pablo, Canuto, Ernesto, Rosauro, Mercedita, Rogelio and
Maximino, all surnamed De Guzman, was canceled and superseded by TCT No. T-9204811 and
registered in the name of the spouses Rosauro and Angelina. TCT No. 92048 was mortgaged by
Rita A. Paguio, attorney-in-fact of the spouses Rosauro and Angelina,12 to Republic Planters
Bank (RP Bank) on August 11, 1982.131avvphi1
Pedro alleged that he is the grandson of one Zacarias de Guzman who is the brother of one
Servando de Guzman. Servando is the grandfather of Rosauro. In other words, Pedro's father
(Ildefonso) and Rosauro's father (Cirilo) are first cousins. Zacarias, Servando, and Andrea were
siblings.
Pedro, allegedly acting in behalf of his co-heirs, maintained that he is entitled to share in the
estate of Andrea. He claimed that, during the lifetime of Andrea, the house which he occupied
had already been adjudicated in his favor. He said that he took care of Andrea, who died in his
own house. He prayed that he be recognized as the owner and legitimate possessor of a parcel of
land, containing an area of 300 square meters, where his house stands. He alleged that BD Bank
accepted the land as collateral from the spouses Angelina and Rosauro without conducting the
necessary investigation and verification of the actual status of the land. He further prayed for the
cancellation of the corresponding title or titles issued, which may affect the area where his house
stands. He, likewise, prayed for payment of damages.
Respondent Angelina and the heirs of Rosauro did not answer the complaint despite service of
summons, hence, they were declared in default. In its Answer,14 BD Bank alleged that Pedro's
complaint stated no cause of action, as there was no clear allegation that the parcel of land
covered by TCT No. 78181 is the same parcel of land over which he has some right or interest. It
also failed to show that Pedro was an heir of Andrea and that he was acting in behalf of his co-
heirs. RP Bank, in its defense,15 alleged that Pedro had no cause of action against the bank. The
bank acted in good faith and exercised due diligence and verified that the mortgagor has a good
title over the property covered by TCT No. 92048.
In its Decision16 dated April 14, 1994, the RTC dismissed the complaint. Aggrieved by the
Decision, Pedro filed a Notice of Appeal,17 which the CA dismissed in a Resolution dated May
30, 2001, for lack of merit. A motion for reconsideration was filed, which the CA denied in a
Resolution dated January 25, 2002.
Pedro died in the interim, thus, his heirs and successors-in-interest (herein petitioners) elevated
the case to this Court via Petition for Review on Certiorari18 under Rule 45 of the Rules of
Court, with the following issues:
In the present case, petitioners allege that Pedro acquired the property subject of this case
covered by TCT No. 78181 through oral partition. They maintain that respondent BD bank is a
mortgagee in bad faith. They, likewise, said that Pedro acquired ownership over the property by
virtue of a document executed by Andrea transferring ownership of the property to him. Finally,
they are asking for the reconveyance of a parcel of land where Pedro's house is situated.
In its Comment, respondent BD Bank alleges that the issue on whether or not it is a mortgagee in
bad faith is a question of fact, and it is not proper for appeal under Rule 45 which deal only with
questions of law.
The petitioner raises two issues in this case, however, upon perusal of the petition, the only issue
in this case is whether or not respondent BD Bank is a mortgagee in bad faith.
Petitioners’ allegation that their predecessor Pedro acquired the land covered by TCT No. 78181
by means of oral partition cannot be taken cognizance by this Court. This allegation was never
raised before the RTC. In the trial court, Pedro's theory was that the property subject of this case
was adjudicated to him by virtue of a document executed by Andrea in his favor. Well settled is
the rule that issues and arguments not brought before the trial court cannot be raised for the first
time on appeal. Basic considerations of due process impel this rule.19
Pedro also claims that Andrea transferred to him the parcel of land measuring about 300 square
meters, where his house was erected. However, as correctly pointed out by the CA, this claim
was not substantiated by evidence.
Records show that Pedro only paid the real property taxes over the properties on March 13, 1984
and January 16, 1985.20 Prior to 1984, he never paid any taxes over the property which he alleged
as his. The Court, therefore, finds that Pedro's payment of real estate taxes in 1984 and 1985 was
only an afterthought to give a semblance of his alleged right over the property, and in preparation
for the filing of the complaint for reconveyance in April 15, 1985.
Nonetheless, as between respondents' title, embodied in a certificate of title, and Pedro's title,
evidenced only by a tax declaration, the former is evidently far superior and is conclusive and an
indefeasible proof of respondents’ ownership over the property subject of this case. Respondents'
certificate of title is binding upon the whole world. Time and again, the Court has ruled that tax
declarations and corresponding tax receipts cannot be used to prove title to or ownership of a real
property inasmuch as they are not conclusive evidence of the same.21
Pedro's allegation that the spouses Rosauro and Angelina resorted to fraud when they caused the
cancellation of OCT No. 10075 and the issuance of TCT Nos. 17181, 17182 and 17183 in their
name is equally unsupported by evidence. It must be stressed that mere allegations of fraud are
insufficient. Intentional acts to deceive and deprive another of his right, or in some manner injure
him, must be specifically alleged and proved.22 For an action for reconveyance based on fraud to
prosper, the party seeking reconveyance must prove by clear and convincing evidence his title to
the property and the fact of fraud.23
Petitioners likewise allege that the heirs of Rosauro and Angelina's failure to answer the
complaint before the RTC is an admission of the allegations in Pedro's complaint. The argument
does not persuade Us. In civil cases, basic is the rule that the party making allegations has the
burden of proving them by a preponderance of evidence. Moreover, parties must rely on the
strength of their own evidence, not upon the weakness of the defense offered by their opponent.
This principle equally holds true, even if the defendant had not been given the opportunity to
present evidence because of a default order. The extent of the relief that may be granted can only
be as much as has been alleged and proved with preponderant evidence required under Section 1
of Rule 133 of the Revised Rules on Evidence.24
In Luxuria Homes, Inc., v. Court of Appeals,25 the Court held that a judgment by default against a
defendant does not imply a waiver of rights, except that of being heard and of presenting
evidence in his favor. It does not imply admission by the defendant of the facts and causes of
action of the plaintiff, because the codal section requires the latter to adduce his evidence in
support of his allegations as an indispensable condition before final judgment could be given in
his favor. Nor could it be interpreted as an admission by the defendant that the plaintiff’s causes
of action finds support in the law, or that the latter is entitled to the relief prayed for.
Additionally, in Pascua v. Florendo,26 the Court held that complainants are not automatically
entitled to the relief prayed for, once the defendants are declared in default. Favorable relief can
be granted only after the court has ascertained that the relief is warranted by the evidence offered
and the facts proven by the presenting party. Otherwise, it would be meaningless to require
presentation of evidence if every time the other party is declared in default, a decision would
automatically be rendered in favor of the non-defaulting party and exactly according to the tenor
of his prayer. This is not contemplated by the Rules nor is it sanctioned by the due process
clause.
Clearly, the heirs of Rosauro and Angelina's failure to answer cannot be equivalent to an implied
admission of the allegations in Pedro's complaint.
Petitioners’ submission that respondents merely hold the title to the properties in trust for their
predecessor Pedro is without merit. Pedro failed to prove by clear and convincing evidence that
the spouses Rosauro and Angelina managed, through fraud, to have the real properties subject of
this case registered in their name. In the absence of fraud, no implied trust was established
between Pedro and the spouses Rosauro and Angelina under Article 145627 of the New Civil
Code. TCT Nos. 17181, 17182 and 17183 are deemed to be fairly and regularly issued.
Delving now on the main issue, petitioners claim that respondent BD Bank is a mortgagee in bad
faith, because at the time the property was mortgaged by the spouses Rosauro and Angelina to
respondent bank, the said Spouses were not residing in the mortgaged property. As correctly
argued by respondent BD Bank, petitions for review under Rule 45 of the Rules of Court may be
brought only on questions of law, not on questions of fact.28 The question on whether the
respondent is a mortgagee in bad faith is clearly a question of fact and, therefore, not proper for
appeals under Rule 45.
Further, the trial court found that respondent BD Bank made an inspection of the property that
was subsequently accepted as collateral for the loan,29 which defeated petitioners' argument that
respondent BD Bank did not exercise due diligence in inspecting and ascertaining the status of
the mortgage property. The factual findings of trial courts are entitled to great weight and respect
on appeal, especially when established by unrebutted testimonial and documentary evidence.30
The Court finds the foregoing conclusion drawn by the trial court supported by documentary
evidence. Records show that after the spouses Rosauro and Angelina applied for a loan with
respondent BD bank, the latter, through its appraiser Oscar M. Ronquillo, conducted an
inspection and appraisal31 of the property covered by TCT No. 78181, together with the existing
improvements thereon. After the said inspection and appraisal of the property, respondent BD
Bank approved the loan32 in favor of the spouses Rosauro and Angelina and, thereafter, executed
a Real Estate Mortgage33 with the said Spouses. Clearly, respondent bank was able to present
sufficient evidence that the mortgage contract emanated from a valid and regular transaction.
Respondent bank, before it accepted the collateral, exercised due diligence in verifying the
ownership and status of the land and the improvements existing in the property mortgaged. From
the above, it is crystal clear that no fraud can be attributed to respondent BD Bank in approving
the Real Estate Mortgage and later on extrajudicially foreclosing the subject property.
WHEREFORE, the petition is DENIED. The Decision and Resolution of the Court of Appeals
in CA-G.R. CV No. 46144, dated May 30, 2001 and January 25, 2002, respectively, are
AFFIRMED.
SO ORDERED.
DIOSDADO M. PERALTA
Associate Justice
WE CONCUR:
ANTONIO T. CARPIO
Associate Justice
Chairperson
ATTESTATION
I attest that the conclusions in the above Decision had been reached in consultation before the
case was assigned to the writer of the opinion of the Court’s Division.
ANTONIO T. CARPIO
Associate Justice
Second Division, Chairperson
CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution and the Division Chairperson’s
Attestation, I certify that the conclusions in the above Decision had been reached in consultation
before the case was assigned to the writer of the opinion of the Court’s Division.
RENATO C. CORONA
Chief Justice
3.Source: http://www.lawphil.net/judjuris/juri2010/jul2010/gr_152266_2010.html
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
RESOLUTION
NACHURA, J.:
Before us is a Verified-Complaint dated February 20, 2009 filed by complainant Atty. Raul L.
Correa charging respondent Judge Medel Arnaldo B. Belen of the Regional Trial Court, Branch
36, Calamba City, Laguna of Misconduct.
Complainant narrated that he was one of the Co-Administrators appointed by the court in Special
Proceedings No. 660-01C, entitled "Intestate Estate of Hector Tan." He revealed that during the
hearing of the case, respondent Judge Belen disagreed with various items in the Administrator’s
Report, including the audited Financial Report covering the said estate, and immediately ruled
that they should be disallowed. Complainant added that respondent Judge Belen scolded their
accountant, branded her as an incompetent, and threatened to sue her before the regulatory body
overseeing all certified public accountants.
Complainant further claimed that, in the course of the proceedings, he was asked by respondent
Judge Belen to stand up while the latter dictated his order on their Administrator’s Report.
Respondent Judge Belen even rebuked him for some mistakes in managing the affairs of the
estate, adding that it is regrettable "because Atty. Raul Correa is a U.P. Law Graduate and a Bar
Topnotcher at that." Complainant regrets the actuations and statements of respondent Judge
Belen, especially because the remark was uncalled for, a left-handed compliment, and a grave
insult to his Alma Mater. Worse, respondent Judge Belen ousted complainant as co-administrator
of the estate of Hector Tan.
On June 18, 2008, respondent Judge Belen issued an Order citing complainant for indirect
contempt, allegedly with administrator Rose Ang Tee, for surreptitiously and unlawfully
withdrawing from and emptying the account of the estate of Hector Tan. The June 18, 2008
Order contained snide remarks, viz—
x x x. The action of Rose Tee and Atty. Raul Correa is contumacious and direct challenge to
lawful orders, and judicial process of this [c]ourt and malicious assault to the orderly
administration of justice, more specifically abhorrent the act and deed of Atty. Raul Correa, a
U.P. Law alumnus and Bar Topnotcher, who as a lawyer knows very well and fully understands
that such action violates his oath of office which the Court cannot countenance. x x x
Lastly, complainant insisted that he should not have been cited for indirect contempt because he
had fully explained to the court that he had done his part as co-administrator in good faith, and
that, through his efforts, the estate was able to meet the deadline for the latest Tax Amnesty
Program of the government, consequently saving the estate the amount of no less than P35
Million.
In his Comment dated August 18, 2009, respondent Judge Belen argued that a judge, having the
heavy burden to always conduct himself in accordance with the ethical tenets of honesty, probity
and integrity, is duty bound to remind counsel of their duties to the court, to their clients, to the
adverse party, and to the opposing counsel.
Respondent Judge Belen claimed that the conduct of complainant in handling the settlement of
the estate of Hector Tan violated and breached the tenets and standards of the legal profession
and of the Lawyer’s Oath. He alleged that, despite the clear tenor of a lawyer-client relationship,
complainant associated himself as corresponding counsel and member of the Ongkiko Law
Office, the counsel of the opposing party in the settlement proceedings.
Respondent Judge Belen further alleged that complainant, in connivance with Rose Ang Tee,
surreptitiously released millions of pesos for the now deceased Purification Tee Tan and to
themselves, in clear violation of complainant’s legal and fiduciary relationship and
responsibilities as court-appointed co-administrator.
Both the Verified-Complaint and the Comment were referred to the Office of the Court
Administrator (OCA) for evaluation, report, and recommendation.
In its Report dated March 10, 2010, the OCA found respondent Judge Belen guilty of conduct
unbecoming of a judge for his use of intemperate language and inappropriate actions in dealing
with counsels, such as complainant, appearing in his sala. The OCA said that respondent Judge
Belen should have just ruled on the motion filed by complainant instead of opting for a conceited
display of arrogance. The OCA also noted that the incidents subject of this administrative matter
were not the first time that respondent Judge Belen had uttered intemperate remarks towards
lawyers appearing before him. It noted that in Mane v. Belen,1 the Court found respondent Judge
Belen guilty of conduct unbecoming of a judge and was reprimanded for engaging in a
supercilious legal and personal discourse.
Based on its evaluation, the OCA recommended that (a) the administrative case against
respondent Judge Belen be re-docketed as a regular administrative matter; and (b) respondent
Judge Belen be fined in the amount of P10,000.00 for conduct unbecoming of a judge, with a
stern warning that a repetition of the same or similar act shall be dealt with more severely.
The findings and the recommendations of the OCA are well taken and, thus, should be upheld.
Indeed, the New Code of Judicial Conduct for the Philippine Judiciary exhorts members of the
judiciary, in the discharge of their duties, to be models of propriety at all times. Canon 4
mandates –
CANON 4
PROPRIETY
Propriety and the appearance of propriety are essential to the performance of all the activities of
a judge.
SECTION 1. Judges shall avoid impropriety and the appearance of impropriety in all of their
activities.
xxx
SEC. 6. Judges, like any other citizen, are entitled to freedom of expression, belief, association
and assembly, but in exercising such rights, they shall always conduct themselves in such a
manner as to preserve the dignity of the judicial office and the impartiality and independence of
the judiciary.
The Code also calls upon judges to ensure equality of treatment to all before the courts. More
specifically, Section 3, Canon 5 on Equality provides –
SEC. 3. Judges shall carry out judicial duties with appropriate consideration for all persons, such
as the parties, witnesses, lawyers, court staff and judicial colleagues, without differentiation on
any irrelevant ground, immaterial to the proper performance of such duties.
We join the OCA in noting that the incidents narrated by complainant were never denied by
respondent Judge Belen, who merely offered his justification and asserted counter accusations
against complainant.
Verily, we hold that respondent Judge Belen should be more circumspect in his language in the
discharge of his duties. A judge is the visible representation of the law. Thus, he must behave, at
all times, in such a manner that his conduct, official or otherwise, can withstand the most
searching public scrutiny. The ethical principles and sense of propriety of a judge are essential to
the preservation of the people’s faith in the judicial system.2
A judge must consistently be temperate in words and in actions. Respondent Judge Belen’s
insulting statements, tending to project complainant’s ignorance of the laws and procedure,
coming from his inconsiderate belief that the latter mishandled the cause of his client is
obviously and clearly insensitive, distasteful, and inexcusable. Such abuse of power and
authority could only invite disrespect from counsels and from the public. Patience is one virtue
that members of the bench should practice at all times, and courtesy to everyone is always called
for.1avvphi1
Conduct unbecoming of a judge is classified as a light offense under Section 10, Rule 140 of the
Revised Rules of Court, penalized under Section 11 (c) thereof by any of the following: (1) a
Fine of not less than P1,000.00 but not exceeding P10,000.00; (2) Censure; (3) Reprimand; and
(4) Admonition with warning. Inasmuch as this is not respondent Judge Belen’s first offense, the
penalty of fine of P10,000.00 is deemed appropriate.
WHEREFORE, we find Judge Medel Arnaldo B. Belen, Presiding Judge of the Regional Trial
Court of Calamba City, Branch 36, GUILTY of Conduct Unbecoming of a Judge, and FINE him
P10,000.00, with a stern warning that a repetition of the same or similar act shall be dealt with
more severely.
SO ORDERED.
WE CONCUR:
ANTONIO T. CARPIO
Associate Justice
Chairperson
4.Source: http://www.lawphil.net/judjuris/juri2010/aug2010/am_rtj-10-2242_2010.html
Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
DECISION
Before the Court is a petition for review on certiorari under Rule 45 of the 1997 Rules of Civil
Procedure, as amended, seeking to annul and set aside the Decision1 dated June 26, 2003 and
Resolution2 dated January 15, 2004 of the Court of Appeals (CA) in CA-G.R. CV No. 61888.
The CA had reversed the Decision3 dated August 3, 1998 of the Regional Trial Court (RTC) of
Malolos, Bulacan, Branch 11, in Civil Case No. 819-M-93 and dismissed petitioners’ complaint
on the ground of prescription.
When Antonio Feliciano passed away on May 20, 1930, he left behind his only property, a parcel
of land located at Bunga4 Mayor, Bustos, Bulacan. The land had an area of 1,125 square meters
and was evidenced by Tax Declaration No. 14025 in his name. On March 28, 1972, Leona,
Maria, Pedro and Salina, all surnamed Feliciano, declared themselves to be the only surviving
heirs of Antonio Feliciano, with the exception of Salina. They executed an extrajudicial
settlement of Antonio Feliciano’s estate6 and appropriated among themselves the said parcel of
land, to the exclusion of the heirs of Esteban Feliciano and Doroteo Feliciano, deceased children
of Antonio Feliciano. On even date, Leona, Maria, Pedro and Salina executed a deed of absolute
sale or Kasulatan sa Ganap Na Bilihan over the property in favor of the late Jacinto Feliciano
(Pedro’s portion), Felisa Feliciano (Salina’s portion) and Pedro Canoza (Leona and Maria’s
portions).7
During his lifetime, Jacinto Feliciano applied for a free patent over the portion of land he bought,
declaring that the same was a public land, first occupied and cultivated by Pedro Feliciano.8
Jacinto was issued Free Patent No. (IV-4) 012293 on November 28, 19779 and the same was
forwarded to the Register of Deeds of Malolos, Bulacan, but unfortunately, it was burned on
March 7, 1987. Pedro Canoza, for his part, also applied for a free patent over the portion of land
which he bought, claiming that the same was public land, first occupied and cultivated by Leona
and Maria Feliciano.10 He was issued Free Patent No. (IV-4) 012292, now covered by Original
Certificate of Title (OCT) No. P-364,11 on February 23, 1979.
On October 18, 1993, Eugenio Feliciano and Angelina Feliciano-de Leon, surviving heirs of the
late Esteban Feliciano, and Trinidad Feliciano-Valiente and Basilia Feliciano-Trinidad, surviving
children of the late Doroteo Feliciano, filed a complaint12 against Salina Feliciano, Felisa
Feliciano, Pedro Canoza and the heirs of the late Jacinto Feliciano, namely Delia, Rosauro, Elsa,
Nardo and Ponciano, all surnamed Feliciano, for the Declaration of Nullity of Documents and
Title, Recovery of Real Property and Damages. They alleged that the settlement of the estate and
sale were done without their participation and consent as heirs of Esteban and Doroteo.
Likewise, they averred that the ancestral home of the Felicianos is erected on the subject
property and that they have occupied the same since birth. Canoza and Jacinto falsely declared
that the property was not occupied, so their titles to the property should be declared null and void
on the ground that they have made false statements in their respective applications for free
patent.
On November 4, 1993, before an Answer could be filed, the petitioners amended their complaint
to include the allegation that they sought to recover the shares of their fathers, Esteban and
Doroteo, which they could have acquired as heirs of Antonio Feliciano.13
In their Answer,14 respondent Pedro Canoza and his spouse, respondent Delia Feliciano, alleged
that they were buyers in good faith and for value. They likewise contended that assuming that
there was preterition of legal heirs, they never took part in it. As affirmative defenses, they
alleged that the complaint failed to state a cause of action; the lower court had no jurisdiction as
the subject of the case were free patents and therefore prior exhaustion of administrative
remedies was required; the case was prematurely filed; no effort was exerted towards a
settlement; plaintiffs’ right has prescribed; Eugenio Feliciano was a mere squatter who should be
ordered to vacate; the deed of sale was validly, genuinely and duly executed; Eugenio and
Angelina were guilty of misleading the court because there were other heirs who were
indispensable parties but who were not included; and Presidential Decree No. 1508 or the
Revised Katarungang Pambarangay Law was not resorted to by plaintiffs.
Respondents Rosauro Feliciano, Elsa Feliciano and Ponciano Feliciano likewise filed an
Answer15 containing the same allegations and defenses as respondents Pedro Canoza and Delia
Feliciano. The other defendants, Salina Feliciano, Felisa Feliciano and Nardo Feliciano were
declared in default.
On August 3, 1998, the trial court rendered a Decision, the dispositive portion of which reads as
follows:
WHEREFORE, judgment is hereby rendered in favor of the plaintiffs and against the defendants,
as follows:
1. Declaring the extra-judicial settlement of estate of Antonio Feliciano null and void;
2. Declaring the sale of the property in question to Pedro Canoza, Felisa Feliciano and
Jacinto Feliciano null and void;
3. Declaring the original certificate of Title No. 364 in the name of Pedro Canoza and the
certificates of titles in the name of defendants over Lot 1874-Cad-344, Bustos Cadastre
(Tax Declaration No. 1402) as null and void;
No pronouncement as to cost.
SO ORDERED.16
The trial court explained that by operation of law, the plaintiffs (herein petitioners) have as much
right as Leona, Maria, Pedro and Salina Feliciano to inherit the property in question, and they
cannot be deprived of their right unless by disinheritance for causes set forth in the law. When
Leona Feliciano, Pedro Feliciano, Maria Feliciano and Salina Feliciano appropriated the disputed
lot solely to themselves through the extrajudicial settlement of estate, they committed a
fraudulent act. To the extent that Doroteo and Esteban were deprived of their rightful share, the
said out-of-court settlement was annullable, said the trial court. The trial court also declared that
Pedro Canoza was not a buyer in good faith of Leona and Maria’s shares. Records show that
Pedro Canoza’s live-in partner, Delia Feliciano, was a relative of the petitioners and the other
defendants; thus, he could be reasonably charged with the knowledge of petitioners’ status vis-à-
vis the subject property. The acquisition by Canoza and Jacinto Feliciano of free patent titles
over portions of the contested lot also did not legitimize their ownership thereof, as they acquired
no greater rights over the property than their predecessors-in-interest, having merely stepped into
their shoes.17
On June 26, 2003, the appellate court rendered the assailed Decision reversing the trial court’s
decision. The CA held,
SO ORDERED.19
The CA ruled that prescription had set in, citing the case of Pedrosa v. Court of Appeals,20 which
held that the applicable prescriptive period to annul a deed of extrajudicial settlement is four (4)
years from the discovery of the fraud. It reasoned that when petitioners filed the instant
complaint for the annulment of the extrajudicial settlement of Antonio Feliciano’s estate, more
than four (4) years had elapsed from the issuance of the free patents. As regards the portion
claimed by the late Jacinto Feliciano, sixteen (16) years had elapsed from the time the free patent
was issued to him before petitioners filed the complaint, while in the case of Canoza, fourteen
(14) years had elapsed from the issuance of the free patent in Canoza’s favor. Hence, according
to the CA, the action for the annulment of the documents had prescribed.
Petitioners filed a motion for reconsideration of the aforesaid Decision but it was denied by the
CA in the Resolution dated January 15, 2004 for lack of merit.
Essentially, the issue for our resolution is whether the CA erred in reversing the trial court’s
decision.
Petitioners allege that the CA gravely erred in granting the appeal and in dismissing the
complaint on the ground of prescription of action because that issue was never raised on appeal,
nor defined as one (1) of the issues outlined and limited in the pre-trial order.
We do not agree.
While respondents have not assigned the defense of prescription in their appeal before the CA,
they raised such defense in their December 1, 1993 Answer as one (1) of their affirmative
defenses.22 In their brief before the CA, respondents specifically prayed for the reliefs mentioned
in their respective answers before the trial court. Thus, by reference, they are deemed to have
adopted the defense of prescription, and could not properly be said to have waived the defense of
prescription.
Moreover, Rule 9, Section 1 of the 1997 Rules of Civil Procedure, as amended, provides that
when it appears from the pleadings or the evidence on record that the action is already barred by
the statute of limitations, the court shall dismiss the claim. Thus, in Gicano v. Gegato,23 we held:
We have ruled that trial courts have authority and discretion to dismiss an action on the ground
of prescription when the parties’ pleadings or other facts on record show it to be indeed time-
barred x x x; and it may do so on the basis of a motion to dismiss, or an answer which sets up
such ground as an affirmative defense; or even if the ground is alleged after judgment on the
merits, as in a motion for reconsideration; or even if the defense has not been asserted at all, as
where no statement thereof is found in the pleadings, or where a defendant has been declared in
default. What is essential only, to repeat, is that the facts demonstrating the lapse of the
prescriptive period, be otherwise sufficiently and satisfactorily apparent on the record: either in
the averments of the plaintiffs complaint, or otherwise established by the evidence.
(Underscoring supplied.)
But did the CA nonetheless commit error when it held that the applicable prescriptive period is
four (4) years?
Petitioners argue that the CA erroneously treated the action they filed at the trial court as one (1)
for annulment of the extrajudicial settlement and applied the four (4)-year prescriptive period in
dismissing the same. They contend that the action they filed was one (1) for Declaration of
Nullity of Documents and Titles, Recovery of Real Property and Damages, and as such, their
action was imprescriptible pursuant to Article 141024 of the Civil Code.
Respondents, for their part, maintain that the CA did not err in holding that the deed of
extrajudicial partition executed without including some of the heirs, who had no knowledge of
the partition and did not consent thereto, is merely fraudulent and not void. They stress that the
action to rescind the partition based on fraud prescribes in four (4) years counted from the date of
registration, which is constructive notice to the whole world.
We affirm the ruling of the CA. As the records show, the heirs of Doroteo and Esteban did not
participate in the extrajudicial partition executed by Salina with the other compulsory heirs,
Leona, Maria and Pedro. Undeniably, the said deed was fraudulently obtained as it deprived the
known heirs of Doroteo and Esteban of their shares in the estate. A deed of extrajudicial partition
executed without including some of the heirs, who had no knowledge of and consent to the same,
is fraudulent and vicious.25 Hence, an action to set it aside on the ground of fraud could be
instituted. Such action for the annulment of the said partition, however, must be brought within
four (4) years from the discovery of the fraud.1avvphi1
Evidently, the applicable prescriptive period to institute the action to annul the deed of
extrajudicial settlement was four (4) years counted from the discovery of fraud as held in the
case of Gerona v. De Guzman.28 However, the records show that petitioners’ complaint was filed
only on October 18, 1993, or almost sixteen (16) years after Jacinto Feliciano was issued Free
Patent No. (IV-4) 012293 on November 28, 1977, and almost fourteen (14) years from the time
Pedro Canoza was issued OCT No. P-364 on November 28, 1979. As petitioners are deemed to
have obtained constructive notice of the fraud upon the registration of the Free Patent, they
clearly failed to institute the present civil action within the allowable period. The same result
obtains even if their complaint is treated as one (1) essentially for reconveyance as more than ten
(10) years have passed since petitioners’ cause of action accrued. The CA committed no error in
dismissing their complaint.
WHEREFORE, the petition for review on certiorari is DENIED. The Decision dated June 26,
2003 and Resolution dated January 15, 2004, of the Court of Appeals in CA-G.R. CV No. 61888
are AFFIRMED.
With costs against petitioners.
SO ORDERED.
WE CONCUR:
ATTESTATION
I attest that the conclusions in the above Decision had been reached in consultation before the
case was assigned to the writer of the opinion of the Court’s Division.
CERTIFICATION
Pursuant to Section 13, Article VIII of the 1987 Constitution and the Division Chairperson’s
Attestation, I certify that the conclusions in the above Decision had been reached in consultation
before the case was assigned to the writer of the opinion of the Court’s Division.
RENATO C. CORONA
Chief Justice
5.Source: http://www.lawphil.net/judjuris/juri2010/sep2010/gr_161746_2010.html
Republic of the Philippines
SUPREME COURT
Baguio City
FIRST DIVISION
DECISION
BERSAMIN, J.:
By petition for review on certiorari, the petitioners appeal the order dated December 28, 2007 of
the Regional Trial Court (RTC), Branch 20, in Cebu City, denying the motion for issuance of
writ of execution of the Office of the Solicitor General (OSG) in behalf of the Government, and
the order dated April 24, 2009, denying their motion for reconsideration filed against the first
order.
Antecedents
The antecedent facts are those established in Alonso v. Cebu Country Club,1 which follow.
Petitioner Francisco M. Alonso (Francisco) was the only son and sole heir of the late spouses
Tomas N. Alonso and Asuncion Medalle. Francisco died during the pendency of this case, and
was substituted by his legal heirs, namely: his surviving spouse, Mercedes V. Alonso, his son
Tomas V. Alonso (Tomas) and his daughter Asuncion V. Alonso.2
In 1992, Francisco discovered documents showing that his father Tomas N. Alonso had acquired
Lot No. 727 of the Banilad Friar Lands Estate from the Government in or about the year 1911;
that the original vendee of Lot No. 727 had assigned his sales certificate to Tomas N. Alonso,
who had been consequently issued Patent No. 14353; and that on March 27, 1926, the Director
of Lands had executed a final deed of sale in favor of Tomas N. Alonso, but the final deed of sale
had not been registered with the Register of Deeds because of lack of requirements, like the
approval of the final deed of sale by the Secretary of Agriculture and Natural Resources, as
required by law.3
Francisco subsequently found that the certificate of title covering Lot No. 727-D-2 of the Banilad
Friar Lands Estate had been "administratively reconstituted from the owner’s duplicate" of
Transfer Certificate of Title (TCT) No. RT-1310 in the name of United Service Country Club,
Inc., the predecessor of respondent Cebu Country Club, Inc (Cebu Country Club); and that upon
the order of the court that had heard the petition for reconstitution of the TCT, the name of the
registered owner in TCT No. RT-1310 had been changed to that of Cebu Country Club; and that
the TCT stated that the reconstituted title was a transfer from TCT No. 1021.4
It is relevant to mention at this point that the current TCT covering Lot 727-D-2 in the name of
Cebu Country Club is TCT No. 94905, which was entered in the land records of Cebu City on
August 8, 1985.5
With his discoveries, Francisco formally demanded upon Cebu Country Club to restore the
ownership and possession of Lot 727-D-2 to him. However, Cebu Country Club denied
Francisco’s demand and claim of ownership, and refused to deliver the possession to him.6
On September 25, 1992, Francisco commenced against Cebu Country Club in the RTC in Cebu
City an action for the declaration of nullity and non-existence of deed/title, the cancellation of
certificates of title, and the recovery of property. On November 5, 1992, Cebu Country Club
filed its answer with counterclaim.7
Both parties appealed to the Court of Appeals (CA), which ultimately affirmed the RTC on
March 31, 1997. Thus, Francisco filed a motion for reconsideration, which was denied on
October 2, 1997.8
On January 31, 2002, this Court decided G.R. No. 130876, decreeing:
WHEREFORE, we DENY the petition for review. However, we SET ASIDE the decision of the
Court of Appeals and that of the Regional Trial Court, Cebu City, Branch 08.
IN LIEU THEREOF, we DISMISS the complaint and counterclaim of the parties in Civil Cases
No. CEB 12926 of the trial court. We declare that Lot No. 727 D-2 of the Banilad Friar Lands
Estate covered by Original Certificate of Title Nos. 251, 232, and 253 legally belongs to the
Government of the Philippines. 9
The petitioners sought a reconsideration. On December 5, 2003, however, the Court denied their
motion for reconsideration.10 Hence, the decision in G.R. No. 130876 became final and
executory.
In late 2004, the Government, through the OSG, filed in the RTC a motion for the issuance of a
writ of execution.11 Cebu Country Club opposed the motion for the issuance of a writ of
execution in due course.
Later on, the proceedings on the OSG’s motion for the issuance of a writ of execution at the
instance of Cebu Country Club in deference to the on-going hearings being conducted by the
Committee on Natural Resources of the House of Representatives on a proposed bill to confirm
the TCTs and reconstituted titles covering the Banilad Friar Lands Estate in Cebu City.12 The
Congress ultimately enacted a law to validate the TCTs and reconstituted titles covering the
Banilad Friar Lands Estate in Cebu City. This was Republic Act No. 9443,13 effective on July 27,
2007.
Thereafter, both Cebu Country Club and the OSG brought the passage of R.A. No. 9443 to the
attention of the RTC for its consideration in resolving the OSG’s motion for the issuance of a
writ of execution.14 On December 28, 2007, therefore, the RTC denied the OSG’s motion for the
issuance of a writ of execution through the first appealed order.15
The petitioners filed a motion for reconsideration dated February 1, 2008, questioning the denial
of the OSG’s motion for the issuance of a writ of execution.16
Upon being directed by the RTC to comment on the petitioners’ motion for reconsideration, the
OSG manifested in writing that the Government was no longer seeking the execution of the
decision in G.R. No. 130876, subject to its reservation to contest any other titles within the
Banilad Friar Lands Estate should clear evidence show such titles as having been obtained
through fraud.17
After the filing of the OSG’s comment, the RTC issued the second appealed order, denying the
petitioners’ motion for reconsideration, giving the following reasons:
1. The party who had a direct interest in the execution of the decision and the
reconsideration of the denial of the motion for execution was the Government,
represented only by the OSG; hence, the petitioners had no legal standing to file the
motion for reconsideration, especially that they were not authorized by the OSG for that
purpose;
2. R.A. No. 9443 "confirms and declares as valid" all "existing" TCTs and reconstituted
titles; thereby, the State in effect waived and divested itself of whatever title or ownership
over the Banilad Friar Lands Estate in favor of the registered owners thereof, including
Lot 727 D-2; and
3. The situation of the parties had materially changed, rendering the enforcement of the
final and executory judgment unjust, inequitable, and impossible, because Cebu Country
Club was now recognized by the State itself as the absolute owner of Lot 727 D-2.18
The petitioners challenge the orders dated December 28, 2007 and April 29, 2009, because:
1. R.A. No. 9443 did not improve Cebu Country Club’s plight, inasmuch as R.A. No.
9443 presupposed first a sales certificate that lacked the required signature, but Cebu
Country Club did not have such sales certificate. Moreover, the titleholders were in fact
the owners of the lands covered by their respective titles, which was not true with Cebu
Country Club due to its being already adjudged with finality to be not the owner of Lot
727-D-2. Lastly, Cebu Country Club’s title was hopelessly defective, as found by the
Supreme Court itself;
2. The doctrine of law of the case barred the application of R.A. No. 9443 to Cebu
Country Club;
3. The RTC’s declaration that R.A. No. 9443 confirmed Cebu Country Club as the
absolute owner of Lot 727-D-2 despite the prior and final judgment of the Supreme Court
that Cebu Country Club was not the owner was unconstitutional, because it virtually
allowed the legislative review of the Supreme Court’s decision rendered against Cebu
Country Club;
4. The use of R.A. No. 9443 as a waiver on the part of the Government vis-à-vis Cebu
Country Club was not only misplaced but downrightly repugnant to Act 1120, the law
governing the legal disposition and alienation of Friar Lands; and
5. The petitioners had the requisite standing to question the patent errors of the RTC,
especially in the face of the unholy conspiracy between the OSG and Cebu Country Club,
on the one hand, and, on the other hand, the passage of R.A. No. 9443 and DENR
Memorandum No. 16, both of which in fact made their predecessor Tomas N. Alonso’s
sales certificate and patent valid.19
Issues
1. Whether or not the petitioners were the real parties-in-interest to question the denial by
the RTC of the OSG’s motion for the issuance of a writ of execution;
2. Whether or not R.A. No. 9443 gave the petitioners a legal interest to assail the RTC’s
orders; and
3. Whether or not the petitioners can appeal by petition for review on certiorari in behalf
of the OSG.
Ruling
A. Preliminary Considerations:
Petitioners contravene the hierarchy of courts, and the petition is fatally defective
Before delving on the stated issues, the Court notes that the petitioners are guilty of two
violations that warrant the immediate dismissal of the petition for review on certiorari.
The first refers to the petitioners’ breach of the hierarchy of courts by coming directly to the
Court to appeal the assailed issuances of the RTC via petition for review on certiorari. They
should not have done so, bypassing a review by the Court of Appeals (CA), because the
hierarchy of courts is essential to the efficient functioning of the courts and to the orderly
administration of justice. Their non-observance of the hierarchy of courts has forthwith enlarged
the docket of the Court by one more case, which, though it may not seem burdensome to the
layman, is one case too much to the Court, which has to devote time and effort in poring over the
papers submitted herein, only to discover in the end that a review should have first been made by
the CA. The time and effort could have been dedicated to other cases of importance and impact
on the lives and rights of others.
The hierarchy of courts is not to be lightly regarded by litigants. The CA stands between the
RTC and the Court, and its establishment has been precisely to take over much of the work that
used to be done by the Court. Historically, the CA has been of the greatest help to the Court in
synthesizing the facts, issues, and rulings in an orderly and intelligible manner and in identifying
errors that ordinarily might escape detection. The Court has thus been freed to better discharge
its constitutional duties and perform its most important work, which, in the words of Dean
Vicente G. Sinco,20 "is less concerned with the decision of cases that begin and end with the
transient rights and obligations of particular individuals but is more intertwined with the
direction of national policies, momentous economic and social problems, the delimitation of
governmental authority and its impact upon fundamental rights."21
The need to elevate the matter first to the CA is also underscored by the reality that determining
whether the petitioners were real parties in interest entitled to bring this appeal against the denial
by the RTC of the OSG’s motion for the issuance of a writ of execution was a mixed question of
fact and law. As such, the CA was in the better position to review and to determine. In that
regard, the petitioners violate Section 1, Rule 45 of the 1997 Rules of Civil Procedure, which
demands that an appeal by petition for review on certiorari be limited to questions of law.22
The second violation concerns the omission of a sworn certification against forum shopping from
the petition for review on certiorari. Section 4, Rule 45 of the 1997 Rules of Civil Procedure
requires that the petition for review should contain, among others, the sworn certification on the
undertakings provided in the last paragraph of Section 2, Rule 42 of the 1997 Rules of Civil
Procedure, viz:
Section 2. xxx
The petitioner shall also submit together with the petition a certification under oath that he has
not theretofore commenced any other action involving the same issues in the Supreme Court, the
Court of Appeals or different divisions thereof, or any other tribunal or agency; if there is such
other action or proceeding, he must state the status of the same; and if he should thereafter learn
that a similar action or proceeding has been filed or is pending before the Supreme Court, the
Court of Appeals, or different divisions thereof, or any other tribunal or agency, he undertakes to
promptly inform the aforesaid courts and other tribunal or agency thereof within five (5) days
therefrom. (n)
Only petitioner Tomas V. Alonso has executed and signed the sworn certification against forum
shopping attached to the petition. Although neither of his co-petitioners – Mercedes V. Alonso
and Asuncion V. Alonso – has joined the certification, Tomas did not present any written express
authorization in his favor authorizing him to sign the certification in their behalf. The signing of
the certification by only one of the petitioners could not be presumed to reflect the personal
knowledge by his co-petitioners of the filing or non-filing of any similar action or claim.23
Hence, the failure of Mercedes and Asuncion to sign and execute the certification along with
Tomas warranted the dismissal of their petition.24
B. Petitioners are not proper parties to appeal and assail the order of the RTC
The petitioners are relentless in insisting that their claim to Lot No. 727-D-2 of the Banilad Friar
Lands Estate should be preferred to that of Cebu Country Club, despite the final judgment in
G.R. No. 130876 being adverse to their claim. Their insistence raises the need to resolve once
and for all whether or not the petitioners retained any legal right to assert over Lot No. 727-D-2
following the Government’s manifest desistance from the execution of the judgment in G.R. No.
130876 against Cebu Country Club.
The above-noted defects of the petition for review notwithstanding, therefore, the Court has now
to address and resolve the stated issues on the sole basis of the results the Court earlier reached in
G.R. No. 130876. In this regard, whether or not the petitioners are the proper parties to bring this
appeal is decisive.
After careful consideration, the Court finds that the cause of the petitioners instantly fails.
In G.R. No. 130876, the Court found that the petitioners did not validly acquire ownership of Lot
No. 727-D-2, and declared that Lot No. 727 D-2 legally belonged to the Government, thus:
The second issue is whether the Court of Appeals erred in ruling that the Cebu Country Club,
Inc. is owner of Lot No. 727.
Admittedly, neither petitioners nor their predecessor had any title to the land in question.
The most that petitioners could claim was that the Director of Lands issued a sales patent in the
name of Tomas N. Alonso. The sales patent, however, and even the corresponding deed of
sale were not registered with the Register of Deeds and no title was ever issued in the name
of the latter. This is because there were basic requirements not complied with, the most
important of which was that the deed of sale executed by the Director of Lands was not
approved by the Secretary of Agriculture and Natural Resources. Hence, the deed of sale
was void. "Approval by the Secretary of Agriculture and Commerce is indispensable for the
validity of the sale." Moreover, Cebu Country Club, Inc. was in possession of the land since
1931, and had been paying the real estate taxes thereon based on tax declarations in its name
with the title number indicated thereon. Tax receipts and declarations of ownership for taxation
purposes are strong evidence of ownership. This Court has ruled that although tax declarations or
realty tax payments are not conclusive evidence of ownership, nevertheless, they are good
indicia of possession in the concept of owner for no one in his right mind will be paying taxes
for a property that is not in his actual or constructive possession.
Notwithstanding this fatal defect, the Court of Appeals ruled that "there was substantial
compliance with the requirement of Act No. 1120 to validly convey title to said lot to Tomas N.
Alonso."
Under Act No. 1120, which governs the administration and disposition of friar lands, the
purchase by an actual and bona fide settler or occupant of any portion of friar land shall be
"agreed upon between the purchaser and the Director of Lands, subject to the approval of the
Secretary of Agriculture and Natural Resources (mutatis mutandis)."
In his Memorandum filed on May 25, 2001, the Solicitor General submitted to this Court
certified copies of Sale Certificate No. 734, in favor of Leoncio Alburo, and Assignment of Sale
Certificate No. 734, in favor of Tomas N. Alonso. Conspicuously, both instruments do not bear
the signature of the Director of Lands and the Secretary of the Interior. They also do not bear the
approval of the Secretary of Agriculture and Natural Resources.
Only recently, in Jesus P. Liao v. Court of Appeals, the Court has ruled categorically that
approval by the Secretary of Agriculture and Commerce of the sale of friar lands is
indispensable for its validity, hence, the absence of such approval made the sale null and void
ab-initio. Necessarily, there can be no valid titles issued on the basis of such sale or assignment.
Consequently, petitioner Francisco’s father did not have any registerable title to the land in
question. Having none, he could not transmit anything to his sole heir, petitioner Francisco
Alonso or the latter’s heirs.
In a vain attempt at showing that he had succeeded to the estate of his father, on May 4, 1991,
petitioner Francisco Alonso executed an affidavit adjudicating the entire estate to himself (Exh.
"Q"), duly published in a newspaper of general circulation in the province and city of Cebu (Exh.
"Q-1"). Such affidavit of self-adjudication is inoperative, if not void, not only because there was
nothing to adjudicate, but equally important because petitioner Francisco did not show proof of
payment of the estate tax and submit a certificate of clearance from the Commissioner of Internal
Revenue. Obviously, petitioner Francisco has not paid the estate taxes.
Consequently, we rule that neither Tomas N. Alonso nor his son Francisco M. Alonso or
the latter’s heirs are the lawful owners of Lot No. 727 in dispute. xxx.25
The pronouncement in G.R. No. 130876 renders beyond dispute that the non-execution of the
judgment would not adversely affect the petitioners, who now hold no right whatsoever in Lot
No. 727-D-2. Otherwise put, they are not the proper parties to assail the questioned orders of the
RTC, because they stand to derive nothing from the execution of the judgment against Cebu
Country Club.
Every action must be prosecuted or defended in the name of the real party in interest, unless
otherwise authorized by law or the rules.26 A real party in interest is one who stands to be
benefited or injured by the judgment in the suit, or the party entitled to the avails of the suit.27
"Interest" within the meaning of the rule means material interest, an interest in issue and to be
affected by the decree, as distinguished from mere interest in the question involved, or a mere
incidental interest. The rule refers to a real or present substantial interest, as distinguished from a
mere expectancy; or from a future, contingent, subordinate, or consequential interest.28 One
having no right or interest to protect cannot invoke the jurisdiction of the court as a party-
plaintiff in an action.29
Thus, an appeal, like this one, is an action to be prosecuted by a party in interest before a higher
court. In order for the appeal to prosper, the litigant must of necessity continue to hold a real or
present substantial interest that entitles him to the avails of the suit on appeal. If he does not, the
appeal, as to him, is an exercise in futility. So it is with the petitioners!
In contrast, the Government, being the legal owner of Lot No. 727-D-2, is the only party
adversely affected by the denial, and is the proper party entitled to assail the denial.30 However,
its manifest desistance from the execution of the decision effectively barred any challenge
against the denial, for its non-appeal rendered the denial final and immutable.
C. R.A. No. 9443 gives petitioners no legal interest to assail the denial of the motion for
execution
Section 1. All existing Transfer Certificates of Title and Reconstituted Certificates of Title
duly issued by the Register of Deeds of Cebu Province and/or Cebu City covering any
portion of the Banilad Friar Lands Estate, notwithstanding the lack of signatures and/or
approval of the then Secretary of Interior (later Secretary of Agriculture and Natural Resources)
and/or the then Chief of the Bureau of Public Lands (later Director of Public Lands) in the copies
of the duly executed Sale Certificates and Assignments of Sale Certificates, as the case may be,
now on file with the Community Environment and Natural Resources Office (CENRO), Cebu
City, are hereby declared as valid titles and the registered owners recognized as absolute
owners thereof.
The law expressly declares as valid "(a)ll existing Transfer Certificates of Title and
Reconstituted Certificates of Title duly issued by the Register of Deeds of Cebu Province and/or
Cebu City covering any portion of the Banilad Friar Lands Estate," and recognizes the registered
owners as absolute owners. To benefit from R.A. No. 9443, therefore, a person must hold as a
condition precedent a duly issued Transfer Certificate of Title or a Reconstituted Certificate of
Title.
Although Lot 727-D-2 was earlier declared to be owned by the Government in G.R. No. 130876,
R.A. No. 9443 later validated Cebu Country Club’s registered ownership due to its holding of
TCT No. RT-1310 (T-11351) in its own name. As the OSG explained in its manifestation in lieu
of comment31 (filed in the RTC vis-à-vis the petitioners’ motion for reconsideration against the
RTC’s denial of the OSG’s motion for issuance of a writ of execution), the enactment of R.A.
No. 9443 had "mooted the final and executory Decision of the Supreme Court in "Alonso v.
Cebu Country Club, Inc.," docketed as G.R. No. 130876, which declared the Government as the
owner of Lot 727-D-2 based on the absence of signature and approval of the then Secretary of
Interior;" and that the decision in G.R. No. 130876 had "ceased to have any practical effect" as
the result of the enactment of R.A. No. 9443, and had thereby become "academic."32
On the question that TCT No. RT-1310 (T-11351) bears the same number as another title to
another land, we agree with the Court of Appeals that there is nothing fraudulent with the
fact that Cebu Country Club, Inc.’s reconstituted title bears the same number as the title of
another parcel of land. This came about because under General Land Registration Office
(GLRO) Circular No. 17, dated February 19, 1947, and Republic Act No. 26 and Circular No. 6,
RD 3, dated August 5, 1946, which were in force at the time the title was reconstituted on July
26, 1948, the titles issued before the inauguration of the Philippine Republic were numbered
consecutively and the titles issued after the inauguration were numbered also consecutively
starting with No. 1, so that eventually, the titles issued before the inauguration were duplicated
by titles issued after the inauguration of the Philippine Republic. xxx.
xxx
Petitioners next argue that the reconstituted title of Cebu Country Club, Inc. had no lawful
source to speak of; it was reconstituted through extrinsic and intrinsic fraud in the absence
of a deed of conveyance in its favor. In truth, however, reconstitution was based on the
owner’s duplicate of the title, hence, there was no need for the covering deed of sale or
other modes of conveyance. Cebu Country Club, Inc. was admittedly in possession of the
land since long before the Second World War, or since 1931. In fact, the original title (TCT
No. 11351) was issued to the United Service Country Club, Inc. on November 19, 1931 as a
transfer from Transfer Certificate of Title No. 1021. More importantly, Cebu Country
Club, Inc. paid the realty taxes on the land even before the war, and tax declarations
covering the property showed the number of the TCT of the land. Cebu Country Club, Inc.
produced receipts showing real estate tax payments since 1949. On the other hand, petitioner
failed to produce a single receipt of real estate tax payment ever made by his father since the
sales patent was issued to his father on March 24, 1926. Worse, admittedly petitioner could not
show any [T]orrens title ever issued to Tomas N. Alonso, because, as said, the deed of sale
executed on March 27, 1926 by the Director of Lands was not approved by the Secretary of
Agriculture and Natural Resources and could not be registered. "Under the law, it is the act of
registration of the deed of conveyance that serves as the operative act to convey the land
registered under the Torrens system. The act of registration creates constructive notice to the
whole world of the fact of such conveyance." On this point, petitioner alleges that Cebu
Country Club, Inc. obtained its title by fraud in connivance with personnel of the Register
of Deeds in 1941 or in 1948, when the title was administratively reconstituted. Imputations
of fraud must be proved by clear and convincing evidence. Petitioner failed to adduce
evidence of fraud. In an action for re-conveyance based on fraud, he who charges fraud must
prove such fraud in obtaining a title. "In this jurisdiction, fraud is never presumed." The
strongest suspicion cannot sway judgment or overcome the presumption of regularity. "The
sea of suspicion has no shore, and the court that embarks upon it is without rudder or compass."
Worse, the imputation of fraud was so tardily brought, some forty-four (44) years or sixty-
one (61) years after its supposed occurrence, that is, from the administrative reconstitution of
title on July 26, 1948, or from the issuance of the original title on November 19, 1931, that
verification is rendered extremely difficult, if not impossible, especially due to the
supervening event of the second world war during which practically all public records were
lost or destroyed, or no longer available.33
IN VIEW OF THE FOREGOING, the petition for review on certiorari is denied for lack of
merit.
The Court declares that Cebu Country Club, Inc. is the exclusive owner of Lot No.727-D-2 of
the Banilad Friar Lands Estate, as confirmed by Republic Act No. 9443.
SO ORDERED.
LUCAS P. BERSAMIN
Associate Justice
WE CONCUR:
REYNATO S. PUNO
Chief Justice
Chairperson
TERESITA J. LEONARDO-DE
CONCHITA CARPIO MORALES
CASTRO
Associate Justice
Associate Justice
CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution, I certify that the conclusions in the
above decision had been reached in consultation before the case was assigned to the writer of the
opinion of the Court’s Division.
REYNATO S. PUNO
Chief Justice
6.Source: http://www.lawphil.net/judjuris/juri2010/apr2010/gr_188471_2010.html
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
SARMIENTO, J.:
This case is a chapter in an earlier suit decided by this Court 1 involving the probate of the two
wills of the late Dolores Luchangco Vitug, who died in New York, U. S.A., on November 10,
1980, naming private respondent Rowena Faustino-Corona executrix. In our said decision, we
upheld the appointment of Nenita Alonte as co-special administrator of Mrs. Vitug's estate with
her (Mrs. Vitug's) widower, petitioner Romarico G. Vitug, pending probate.
On January 13, 1985, Romarico G. Vitug filed a motion asking for authority from the probate
court to sell certain shares of stock and real properties belonging to the estate to cover allegedly
his advances to the estate in the sum of P667,731.66, plus interests, which he claimed were
personal funds. As found by the Court of Appeals, 2 the alleged advances consisted of
P58,147.40 spent for the payment of estate tax, P518,834.27 as deficiency estate tax, and
P90,749.99 as "increment thereto." 3 According to Mr. Vitug, he withdrew the sums of
P518,834.27 and P90,749.99 from savings account No. 35342-038 of the Bank of America,
Makati, Metro Manila.
On April 12, 1985, Rowena Corona opposed the motion to sell on the ground that the same funds
withdrawn from savings account No. 35342-038 were conjugal partnership properties and part of
the estate, and hence, there was allegedly no ground for reimbursement. She also sought his
ouster for failure to include the sums in question for inventory and for "concealment of funds
belonging to the estate." 4
Vitug insists that the said funds are his exclusive property having acquired the same through a
survivorship agreement executed with his late wife and the bank on June 19, 1970. The
agreement provides:
We hereby agree with each other and with the BANK OF AMERICAN
NATIONAL TRUST AND SAVINGS ASSOCIATION (hereinafter referred to as
the BANK), that all money now or hereafter deposited by us or any or either of us
with the BANK in our joint savings current account shall be the property of all or
both of us and shall be payable to and collectible or withdrawable by either or any
of us during our lifetime, and after the death of either or any of us shall belong to
and be the sole property of the survivor or survivors, and shall be payable to and
collectible or withdrawable by such survivor or survivors.
We further agree with each other and the BANK that the receipt or check of
either, any or all of us during our lifetime, or the receipt or check of the survivor
or survivors, for any payment or withdrawal made for our above-mentioned
account shall be valid and sufficient release and discharge of the BANK for such
payment or withdrawal. 5
The trial courts 6 upheld the validity of this agreement and granted "the motion to sell some of
the estate of Dolores L. Vitug, the proceeds of which shall be used to pay the personal funds of
Romarico Vitug in the total sum of P667,731.66 ... ." 7
On the other hand, the Court of Appeals, in the petition for certiorari filed by the herein private
respondent, held that the above-quoted survivorship agreement constitutes a conveyance mortis
causa which "did not comply with the formalities of a valid will as prescribed by Article 805 of
the Civil Code," 8 and secondly, assuming that it is a mere donation inter vivos, it is a prohibited
donation under the provisions of Article 133 of the Civil Code. 9
WHEREFORE, the order of respondent Judge dated November 26, 1985 (Annex
II, petition) is hereby set aside insofar as it granted private respondent's motion to
sell certain properties of the estate of Dolores L. Vitug for reimbursement of his
alleged advances to the estate, but the same order is sustained in all other respects.
In addition, respondent Judge is directed to include provisionally the deposits in
Savings Account No. 35342-038 with the Bank of America, Makati, in the
inventory of actual properties possessed by the spouses at the time of the
decedent's death. With costs against private respondent. 10
In his petition, Vitug, the surviving spouse, assails the appellate court's ruling on the strength of
our decisions in Rivera v. People's Bank and Trust Co. 11 and Macam v. Gatmaitan 12 in which
we sustained the validity of "survivorship agreements" and considering them as aleatory
contracts. 13
The conveyance in question is not, first of all, one of mortis causa, which should be embodied in
a will. A will has been defined as "a personal, solemn, revocable and free act by which a
capacitated person disposes of his property and rights and declares or complies with duties to
take effect after his death." 14 In other words, the bequest or device must pertain to the testator. 15
In this case, the monies subject of savings account No. 35342-038 were in the nature of conjugal
funds In the case relied on, Rivera v. People's Bank and Trust Co., 16 we rejected claims that a
survivorship agreement purports to deliver one party's separate properties in favor of the other,
but simply, their joint holdings:
... Such conclusion is evidently predicated on the assumption that Stephenson was
the exclusive owner of the funds-deposited in the bank, which assumption was in
turn based on the facts (1) that the account was originally opened in the name of
Stephenson alone and (2) that Ana Rivera "served only as housemaid of the
deceased." But it not infrequently happens that a person deposits money in the
bank in the name of another; and in the instant case it also appears that Ana
Rivera served her master for about nineteen years without actually receiving her
salary from him. The fact that subsequently Stephenson transferred the account to
the name of himself and/or Ana Rivera and executed with the latter the
survivorship agreement in question although there was no relation of kinship
between them but only that of master and servant, nullifies the assumption that
Stephenson was the exclusive owner of the bank account. In the absence, then, of
clear proof to the contrary, we must give full faith and credit to the certificate of
deposit which recites in effect that the funds in question belonged to Edgar
Stephenson and Ana Rivera; that they were joint (and several) owners thereof;
and that either of them could withdraw any part or the whole of said account
during the lifetime of both, and the balance, if any, upon the death of either,
belonged to the survivor. 17
There is no showing that the funds exclusively belonged to one party, and hence it must be
presumed to be conjugal, having been acquired during the existence of the marita. relations. 20
Neither is the survivorship agreement a donation inter vivos, for obvious reasons, because it was
to take effect after the death of one party. Secondly, it is not a donation between the spouses
because it involved no conveyance of a spouse's own properties to the other.
It is also our opinion that the agreement involves no modification petition of the conjugal
partnership, as held by the Court of Appeals, 21 by "mere stipulation" 22 and that it is no "cloak" 23
to circumvent the law on conjugal property relations. Certainly, the spouses are not prohibited by
law to invest conjugal property, say, by way of a joint and several bank account, more commonly
denominated in banking parlance as an "and/or" account. In the case at bar, when the spouses
Vitug opened savings account No. 35342-038, they merely put what rightfully belonged to them
in a money-making venture. They did not dispose of it in favor of the other, which would have
arguably been sanctionable as a prohibited donation. And since the funds were conjugal, it can
not be said that one spouse could have pressured the other in placing his or her deposits in the
money pool.
The validity of the contract seems debatable by reason of its "survivor-take-all" feature, but in
reality, that contract imposed a mere obligation with a term, the term being death. Such
agreements are permitted by the Civil Code. 24
ART. 2010. By an aleatory contract, one of the parties or both reciprocally bind
themselves to give or to do something in consideration of what the other shall
give or do upon the happening of an event which is uncertain, or which is to occur
at an indeterminate time.
Under the aforequoted provision, the fulfillment of an aleatory contract depends on either the
happening of an event which is (1) "uncertain," (2) "which is to occur at an indeterminate time."
A survivorship agreement, the sale of a sweepstake ticket, a transaction stipulating on the value
of currency, and insurance have been held to fall under the first category, while a contract for life
annuity or pension under Article 2021, et sequentia, has been categorized under the second. 25 In
either case, the element of risk is present. In the case at bar, the risk was the death of one party
and survivorship of the other.
There is no demonstration here that the survivorship agreement had been executed for such
unlawful purposes, or, as held by the respondent court, in order to frustrate our laws on wills,
donations, and conjugal partnership.
The conclusion is accordingly unavoidable that Mrs. Vitug having predeceased her husband, the
latter has acquired upon her death a vested right over the amounts under savings account No.
35342-038 of the Bank of America. Insofar as the respondent court ordered their inclusion in the
inventory of assets left by Mrs. Vitug, we hold that the court was in error. Being the separate
property of petitioner, it forms no more part of the estate of the deceased.
WHEREFORE, the decision of the respondent appellate court, dated June 29, 1987, and its
resolution, dated February 9, 1988, are SET ASIDE.
No costs.
SO ORDERED.
7.Source: http://www.lawphil.net/judjuris/juri1990/mar1990/gr_82027_1990.html
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
DECISION
Respondent Cayetano L. Serrano (Cayetano) filed on September 21, 1988 before the Regional
Trial Court (RTC) of Butuan City an application for registration,2 docketed as LRC Case No.
270, over a 533-square meter parcel of commercial land known as Lot 249 ([on Plan Psu-
157485] the lot), located in Poblacion Cabadbaran, Agusan del Norte.
Cayetano claimed to have acquired the lot by inheritance from his deceased parents, Simeon
Serrano (Simeon) and Agustina Luz; by virtue of a Deed of Exchange3 dated February 10, 1961;
and by a private deed of partition and extrajudicial settlement forged by him and his co-heirs.
Invoking the applicability of Presidential Decree No. 1529 or the Property Registration Decree
or, in the alternative, the provisions of Chapter VIII, Section 48(b) of Commonwealth Act No.
141,4 Cayetano also claimed to have been in open, continuous, exclusive and notorious
possession of the lot under a claim of ownership before 1917 by himself and through his
deceased parents–predecessors-in-interest or for more than 70 years.
The Heirs of Catalino Alaan, represented by Paulita Alaan (Paulita),5 intervened and filed an
application for registration,6 their predecessor-in-interest Catalino Alaan (Catalino) having
purchased7 a 217.45-square meter undivided portion of the lot from Cayetano on February 27,
1989 during the pendency of Cayetano’s application for registration.
The intervenor-heirs of Catalino, also invoking the provisions of the Property Registration
Decree or, alternatively, of Chapter VIII, Section 48(b) of Commonwealth Act No. 141, prayed
that their application for confirmation of title be considered jointly with that of Cayetano’s, and
that, thereafter, original certificates of title be issued in both their names.
At the trial, the following pieces of documentary evidence, inter alia, were presented to support
Cayetano’s claim of ownership over the lot: original survey plan dated January 3, 1957 and
certified by the Department of Environment and Natural Resources (DENR), and Bureau of
Lands Director Zoilo Castrillo,10 technical description of the lot (Psu-157485),11 Tax
Declarations for the years 1924 (in the name of Simeon) and 1948-1997 (in the name of either
Simeon [deceased] or Cayetano),12 official receipts showing real estate tax payments (from 1948-
1997),13 and Surveyor’s Certificate No. 157485 dated January 1957.14
As Cayetano’s sole witness Leonardo was already physically infirm (hard of hearing and due to
old age) at the time trial commenced, his testimony was taken by deposition on written
interrogatories.15
In answer to the interrogatories,16 Leonardo declared that his family had lived on the lot since
pre-war time, his father Simeon having built a house on it following his acquisition from Julian
Ydulzura in 192317 who had purchased it from Lazaro Rañada in 1917;18 that the construction of
a family home in 1923 was reflected in Tax Declaration No. 18,587 in the name of Simeon for
the year 192419; that after his father’s death in 1931, his mother and his brother Cayetano
continued to possess the lot in the concept of owners and Cayetano in fact built his own house
and a bodega thereon; that Cayetano religiously paid real estate taxes from 1951 up to the current
year 1997;20 that the lot was assigned to him and Cayetano as their share of the inheritance by
virtue of a private document, "Kaligonan," dated June 16, 1951,21 which was executed by all of
the heirs, the contents of which document were subsequently confirmed in a Deed of
Extrajudicial Settlement dated August 24, 1988;22 and that on February 10, 1961, Cayetano
exchanged a titled lot in Butuan City for his (Leonardo’s) half-share in the lot, thereby making
Cayetano the sole and exclusive owner thereof.23
On the other hand, Paulita, wife of Catalino who represented the heirs of Catalino, declared that
in February 1989, Cayetano sold to her husband a 217.45-sq. meter portion of the 533-sq. meter
lot subject of the present case as embodied in a deed of absolute sale;24 and that Catalino
religiously paid real estate taxes therefor. And she presented an approved Subdivision Plan of
Lot 249,25 Cad-866 indicating therein the respective shares of Cayetano and Catalino based on a
survey undertaken by Geodetic Engineer Armando Diola on May 9, 1997.26
The above-said Subdivision Plan of the lot, duly approved by Celso V. Loriega, Jr., Regional
Technical Director of the DENR, Lands Management Services, Region Office XIII for Butuan
City, carries the following annotation:
This survey is inside the alienable and disposable area as per project no. 5 L.C Map No. 550
certified on July 18, 1925.
Lot 249-A, Lot 9090, Lot 249-B, Lot 9091, CAD 866 Cabadbaran Cadastre. (emphasis and
underscoring supplied)
1. Awarding a portion of Lot 249, Psu-15(5)7485 (now known as Lot 249-B, Csd-13-
000443-D) containing an area of 316 sq. meters to applicant Cayetano L. Serrano, Sr.,
represented by his heirs;
2. Awarding a portion of Lot 249, Psu-157485 (now known as Lot 249-A, Csd-1-000443-
D) containing an area of 217 sq. meters to applicant Catalina M. Alaan, represented by
Paulita P. Alaan;
IT IS SO ORDERED.
The Office of the Solicitor General, on behalf of herein petitioner, appealed the RTC decision
before the Court of Appeals on the grounds that respondents failed to present evidence that the
property was alienable or that they possessed the same in the manner and duration required by
the provisions of the Property Registration Decree.28
By Decision of May 13, 2008,29 the appellate court affirmed the decision of the RTC in this wise:
xxxx
. . . [F]rom the aforequoted annotation, the OSG’s assertion that there was no competent
evidence that would clearly show the subject land was released as alienable and disposable land
is unavailing. On the contrary, We HOLD that the said annotation would suffice to comply with
the requirement of certification as the same is competent enough to show that the disputed land
or the parcels of land (now Lot Nos. 249-A, Cad-866 and 249-B Cad-866, respectively) applied
for by the applicants (Cayetano and Alaan) were already reclassified as alienable and disposable
as early as 18 July 1925, under Project No. 5, L.C. Map No. 550.
xxxx
Records show that the subject land was first owned and possessed by Lazaro Rañada and the
same was sold to Julian Ydulzura per untitled document executed on 15 May 1917. On 3
September 1923, Ydulzura sold the subject land for one hundred fifty pesos (Php150.00) to
Simeon M. Serrano per untitled document, father of Cayetano. Simeon M. Serrano then had the
subject land tax declared in his name in 1924 per Declaration of Real Property (Urban) No.
18,587. Upon the demise of Simeon Serrano on 9 January 1931, his heirs, including herein
applicant Cayetano, partitioned by way of an Agreement on 16 June 1951 the properties of their
deceased father. On 24 August 1988, the heirs of Simeon M. Serrano executed a Deed of
Extrajudicial Settlement confirming further the Agreement executed on 16 June 1954 (sic). It is
worth noting that from 1955 up to the filing of the Application for Registration in 21 June 1988
and until 1997, Cayetano religiously paid the real estate taxes of the said subject property. As
held in a long line of cases, tax declarations or realty tax payments of property are not conclusive
evidence of ownership, nevertheless, they are good indicia of possession in the concept of owner.
Undoubtedly, applicant Cayetano, through his predecessors-in-interest, having been in open,
continuous, exclusive and notorious possession and occupation over the subject property under a
bona fide claim of ownership since June 12, 1945, or earlier had met the requirements set forth in
Section 14(1) of the Property Registration Decree.
In fine, We FIND and so HOLD that applicant Cayetano L. Serrano and intervenor-appellee
heirs of Catalino M. Alaan, have registrable title to the aforesaid subject lands, Lot 249-B, Csd-
13-000443-D and Lot 249-A, Csd-1-000443-D, respectively, as they were able to prove that they
are qualified and had complied with the requirements set forth by the provisions of P.D. No.
1529 which amended Commonwealth Act No. 141, as amended and Presidential Decree No.
1073, which to Our mind merited the allowance of the application for registration of the said
property by the trial court.30 (italics in the original; emphasis and underscoring supplied)
Hence, the present petition which raises the same grounds as those raised by petitioner before the
appellate court.
The requisites for the filing of an application for registration of title under Section 14(1) of the
Property Registration Decree are: that the property is alienable and disposable land of the public
domain; that the applicants by themselves or through their predecessors-in-interest have been in
open, continuous, exclusive and notorious possession and occupation thereof; and that such
possession is under a bona fide claim of ownership since June 12, 1945 or earlier.31
The Court reiterates the doctrine which more accurately construes Section 14(1) in Republic of
the Philippines v. Court of Appeals and Naguit,32 viz:
. . . the more reasonable interpretation of Section 14(1) is that it merely requires the property
sought to be registered as already alienable and disposable at the time the application for
registration of title is filed. If the State, at the time the application is made, has not yet deemed it
proper to release the property for alienation or disposition, the presumption is that the
government is still reserving the right to utilize the property; hence, the need to preserve its
ownership in the State irrespective of the length of adverse possession even if in good faith.
However, if the property has already been classified as alienable and disposable, as it is in this
case, then there is already an intention on the part of the State to abdicate its exclusive
prerogative over the property.
This reading aligns conformably with our holding in Republic v. Court of Appeals. Therein, the
Court noted that "to prove that the land subject of an application for registration is alienable, an
applicant must establish the existence of a positive act of the government such as a presidential
proclamation or an executive order; an administrative action; investigation reports of Bureau of
Lands investigators; and a legislative act or a statute." In that case, the subject land had been
certified by the DENR as alienable and disposable in 1980, thus the Court concluded that the
alienable status of the land, compounded by the established fact that therein respondents had
occupied the land even before 1927, sufficed to allow the application for registration of the said
property. In the case at bar, even the petitioner admits that the subject property was released and
certified as within alienable and disposable zone in 1980 by the DENR.33 (Citations omitted;
emphasis and underscoring supplied)
While Cayetano failed to submit any certification which would formally attest to the alienable
and disposable character of the land applied for, the Certification by DENR Regional Technical
Director Celso V. Loriega, Jr., as annotated on the subdivision plan submitted in evidence by
Paulita, constitutes substantial compliance with the legal requirement. It clearly indicates that Lot
249 had been verified as belonging to the alienable and disposable area as early as July 18, 1925.
The DENR certification enjoys the presumption of regularity absent any evidence to the
contrary. It bears noting that no opposition was filed or registered by the Land Registration
Authority or the DENR to contest respondents’ applications on the ground that their respective
shares of the lot are inalienable. There being no substantive rights which stand to be prejudiced,
the benefit of the Certification may thus be equitably extended in favor of respondents.1avvphi1
Petitioner’s contention that respondents failed to adduce sufficient proof of possession and
occupation as required under Section 14(1) of the Property Registration Decree does not lie.
The law speaks of possession and occupation. Since these words are separated by the
conjunction and, the clear intention of the law is not to make one synonymous with the other.
Possession is broader than occupation because it includes constructive possession. When,
therefore, the law adds the word occupation, it seeks to delimit the all encompassing effect of
constructive possession. Taken together with the words open, continuous, exclusive and
notorious, the word occupation serves to highlight the fact that for an applicant to qualify, his
possession must not be a mere fiction. Actual possession of a land consists in the manifestation
of acts of dominion over it of such a nature as a party would naturally exercise over his own
property. (emphasis and underscoring supplied)
Leonardo clearly established the character of the possession of Cayetano and his predecessors-in-
interest over the lot. Thus he declared that the lot was first owned by Lazaro Rañada who sold
the same to Julian Ydulzura in 1917 who in turn sold it to his and Cayetano’s father Simeon in
1923; that Simeon built a house thereon after its acquisition, which fact is buttressed by entries in
Tax Declaration No. 18,587 in the name of Simeon for the year 1924 indicating the existence of
a 40-sq. meter residential structure made of nipa and mixed materials, and of coconut trees
planted thereon; and that after Simeon’s demise in 1931, Cayetano built his own house beside the
old nipa house before the war, and a bodega after the war, which claims find support in Tax
Declarations made in 1948-1958.35
Finally, the official receipts of realty tax payments37 religiously made by Cayetano from 1948 to
1997 further serve as credible indicia that Cayetano, after his father’s death in 1931, continued to
exercise acts of dominion over the lot.
The totality of the evidence thus points to the unbroken chain of acts exercised by Cayetano to
demonstrate his occupation and possession of the land in the concept of owner, to the exclusion
of all others.
No costs.
SO ORDERED.
WE CONCUR:
REYNATO S. PUNO
Chief Justice
Chairperson
TERESITA J. LEONARDO-DE
LUCAS P. BERSAMIN
CASTRO
Associate Justice
Associate Justice
CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution, I certify that the conclusions in the
above decision had been reached in consultation before the case was assigned to the writer of the
opinion of the Court’s Division.
REYNATO S. PUNO
Chief Justice
8.Source: http://www.lawphil.net/judjuris/juri2010/feb2010/gr_183063_2010.html
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
DECISION
NACHURA, J.:
This petition1 for review on certiorari under Rule 45 of the Rules of Court seeks to reverse and
set aside the Decision2 dated December 16, 2008 and the Resolution3 dated April 30, 2009 of the
Court of Appeals (CA) in CA-G.R. SP No. 104683. The Decision annulled and set aside the
Order dated March 13, 20084 of the Regional Trial Court (RTC), Branch 24, Biñan, Laguna, in
Sp. Proc. No. B-3089; while the Resolution denied the motion for reconsideration of the
Decision.
The Antecedents
Petitioners Dalisay E. Ocampo (Dalisay), Vince E. Ocampo (Vince), Melinda Carla E. Ocampo
(Melinda), and Leonardo E. Ocampo, Jr. (Leonardo, Jr.) are the surviving wife and the children
of Leonardo Ocampo (Leonardo), who died on January 23, 2004. Leonardo and his siblings,
respondents Renato M. Ocampo (Renato) and Erlinda M. Ocampo (Erlinda) are the legitimate
children and only heirs of the spouses Vicente and Maxima Ocampo, who died intestate on
December 19, 1972 and February 19, 1996, respectively. Vicente and Maxima left several
properties, mostly situated in Biñan, Laguna. Vicente and Maxima left no will and no debts.
On June 24, 2004, five (5) months after the death of Leonardo, petitioners initiated a petition for
intestate proceedings, entitled "In Re: Intestate Proceedings of the Estate of Sps. Vicente
Ocampo and Maxima Mercado Ocampo, and Leonardo M. Ocampo," in the RTC, Branch 24,
Biñan, Laguna, docketed as Spec. Proc. No. B-3089.5 The petition alleged that, upon the death of
Vicente and Maxima, respondents and their brother Leonardo jointly controlled, managed, and
administered the estate of their parents. Under such circumstance, Leonardo had been receiving
his share consisting of one-third (1/3) of the total income generated from the properties of the
estate. However, when Leonardo died, respondents took possession, control and management of
the properties to the exclusion of petitioners. The petition prayed for the settlement of the estate
of Vicente and Maxima and the estate of Leonardo. It, likewise, prayed for the appointment of an
administrator to apportion, divide, and award the two estates among the lawful heirs of the
decedents.
Respondents filed their Opposition and Counter-Petition dated October 7, 2004,6 contending that
the petition was defective as it sought the judicial settlement of two estates in a single
proceeding. They argued that the settlement of the estate of Leonardo was premature, the same
being dependent only upon the determination of his hereditary rights in the settlement of his
parents’ estate. In their counter-petition, respondents prayed that they be appointed as special
joint administrators of the estate of Vicente and Maxima.
In an Order dated March 4, 2005,7 the RTC denied respondents’ opposition to the settlement
proceedings but admitted their counter-petition. The trial court also clarified that the judicial
settlement referred only to the properties of Vicente and Maxima.
Through a Motion for Appointment of Joint Special Administrators dated October 11, 2005,8
respondents reiterated their prayer for appointment as special joint administrators of the estate,
and to serve as such without posting a bond.
In their Comment dated November 3, 2005,9 petitioners argued that, since April 2002, they had
been deprived of their fair share of the income of the estate, and that the appointment of
respondents as special joint administrators would further cause injustice to them. Thus, they
prayed that, in order to avoid further delay, letters of administration to serve as joint
administrators of the subject estate be issued to respondents and Dalisay.
In its June 15, 2006 Order,11 the RTC appointed Dalisay and Renato as special joint
administrators of the estate of the deceased spouses, and required them to post a bond of
P200,000.00 each.12
Respondents filed a Motion for Reconsideration dated August 1, 200613 of the Order, insisting
that Dalisay was incompetent and unfit to be appointed as administrator of the estate, considering
that she even failed to take care of her husband Leonardo when he was paralyzed in 1997. They
also contended that petitioners’ prayer for Dalisay’s appointment as special administrator was
already deemed abandoned upon their nomination of the Biñan Rural Bank to act as special
administrator of the estate.
In their Supplement to the Motion for Reconsideration,14 respondents asserted their priority in
right to be appointed as administrators being the next of kin of Vicente and Maxima, whereas
Dalisay was a mere daughter-in-law of the decedents and not even a legal heir by right of
representation from her late husband Leonardo.
Pending the resolution of the Motion for Reconsideration, petitioners filed a Motion to Submit
Inventory and Accounting dated November 20, 2006,15 praying that the RTC issue an order
directing respondents to submit a true inventory of the estate of the decedent spouses and to
render an accounting thereof from the time they took over the collection of the income of the
estate.
Respondents filed their Comment and Manifestation dated January 15, 2007,16 claiming that they
could not yet be compelled to submit an inventory and render an accounting of the income and
assets of the estate inasmuch as there was still a pending motion for reconsideration of the June
15, 2006 Order appointing Dalisay as co-special administratrix with Renato.
In its Order dated February 16, 2007, the RTC revoked the appointment of Dalisay as co-special
administratrix, substituting her with Erlinda. The RTC took into consideration the fact that
respondents were the nearest of kin of Vicente and Maxima. Petitioners did not contest this
Order and even manifested in open court their desire for the speedy settlement of the estate.
On April 23, 2007, or two (2) months after respondents’ appointment as joint special
administrators, petitioners filed a Motion for an Inventory and to Render Account of the Estate,17
reiterating their stance that respondents, as joint special administrators, should be directed to
submit a true inventory of the income and assets of the estate.
Respondents then filed a Motion for Exemption to File Administrators’ Bond18 on May 22, 2007,
praying that they be allowed to enter their duties as special administrators without the need to file
an administrators’ bond due to their difficulty in raising the necessary amount. They alleged that,
since petitioners manifested in open court that they no longer object to the appointment of
respondents as special co-administrators, it would be to the best interest of all the heirs that the
estate be spared from incurring unnecessary expenses in paying for the bond premiums. They
also assured the RTC that they would faithfully exercise their duties as special administrators
under pain of contempt should they violate any undertaking in the performance of the trust of
their office.
In an Order dated June 29, 2007,19 the RTC directed the parties to submit their respective
comments or oppositions to the pending incidents, i.e., petitioners’ Motion for Inventory and to
Render Account, and respondents’ Motion for Exemption to File Administrators’ Bond.
Respondents filed their Comment and/or Opposition,20 stating that they have already filed a
comment on petitioners’ Motion for Inventory and to Render Account. They asserted that the
RTC should, in the meantime, hold in abeyance the resolution of this Motion, pending the
resolution of their Motion for Exemption to File Administrators’ Bond.
On October 15, 2007, or eight (8) months after the February 16, 2007 Order appointing
respondents as special joint administrators, petitioners filed a Motion to Terminate or Revoke the
Special Administration and to Proceed to Judicial Partition or Appointment of Regular
Administrator.21 Petitioners contended that the special administration was not necessary as the
estate is neither vast nor complex, the properties of the estate being identified and undisputed,
and not involved in any litigation necessitating the representation of special administrators.
Petitioners, likewise, contended that respondents had been resorting to the mode of special
administration merely to delay and prolong their deprivation of what was due them. Petitioners
cited an alleged fraudulent sale by respondents of a real property for P2,700,000.00, which the
latter represented to petitioners to have been sold only for P1,500,000.00, and respondents’
alleged misrepresentation that petitioners owed the estate for the advances to cover the hospital
expenses of Leonardo, but, in fact, were not yet paid.
Respondents filed their Opposition and Comment22 on March 10, 2008, to which, in turn,
petitioners filed their Reply to Opposition/Comment23 on March 17, 2008.
In its Order dated March 13, 2008,24 the RTC granted petitioners’ Motion, revoking and
terminating the appointment of Renato and Erlinda as joint special administrators, on account of
their failure to comply with its Order, particularly the posting of the required bond, and to enter
their duties and responsibilities as special administrators, i.e., the submission of an inventory of
the properties and of an income statement of the estate. The RTC also appointed Melinda as
regular administratrix, subject to the posting of a bond in the amount of P200,000.00, and
directed her to submit an inventory of the properties and an income statement of the subject
estate. The RTC likewise found that judicial partition may proceed after Melinda had assumed
her duties and responsibilities as regular administratrix.
Aggrieved, respondents filed a petition for certiorari25 under Rule 65 of the Rules of Court before
the CA, ascribing grave abuse of discretion on the part of the RTC in (a) declaring them to have
failed to enter the office of special administration despite lapse of reasonable time, when in truth
they had not entered the office because they were waiting for the resolution of their motion for
exemption from bond; (b) appointing Melinda as regular administratrix, a mere granddaughter of
Vicente and Maxima, instead of them who, being the surviving children of the deceased spouses,
were the next of kin; and (c) declaring them to have been unsuitable for the trust, despite lack of
hearing and evidence against them.
Petitioners filed their Comment to the Petition and Opposition to Application for temporary
restraining order and/or writ of preliminary injunction,26 reiterating their arguments in their
Motion for the revocation of respondents’ appointment as joint special administrators.
Respondents filed their Reply.27
On December 16, 2008, the CA rendered its assailed Decision granting the petition based on the
finding that the RTC gravely abused its discretion in revoking respondents’ appointment as joint
special administrators without first ruling on their motion for exemption from bond, and for
appointing Melinda as regular administratrix without conducting a formal hearing to determine
her competency to assume as such. According to the CA, the posting of the bond is a prerequisite
before respondents could enter their duties and responsibilities as joint special administrators,
particularly their submission of an inventory of the properties of the estate and an income
statement thereon.
Petitioners filed a Motion for Reconsideration of the Decision.28 The CA, however, denied it.
Hence, this petition, ascribing to the CA errors of law and grave abuse of discretion for annulling
and setting aside the RTC Order dated March 13, 2008.
Our Ruling
The pertinent provisions relative to the special administration of the decedents’ estate under the
Rules of Court provide—
Sec. 1. Appointment of special administrator. – When there is delay in granting letters
testamentary or of administration by any cause including an appeal from the allowance or
disallowance of a will, the court may appoint a special administrator to take possession and
charge of the estate of the deceased until the questions causing the delay are decided and
executors or administrators appointed.29
Sec. 2. Powers and duties of special administrator. – Such special administrator shall take
possession and charge of goods, chattels, rights, credits, and estate of the deceased and preserve
the same for the executor or administrator afterwards appointed, and for that purpose may
commence and maintain suits as administrator. He may sell only such perishable and other
property as the court orders sold. A special administrator shall not be liable to pay any debts of
the deceased unless so ordered by the court.30
Sec. 1. Bond to be given before issuance of letters; Amount; Conditions. – Before an executor or
administrator enters upon the execution of his trust, and letters testamentary or of administration
issue, he shall give a bond, in such sum as the court directs, conditioned as follows:
(a) To make and return to the court, within three (3) months, a true and complete
inventory of all goods, chattels, rights, credits, and estate of the deceased which shall
come to his possession or knowledge or to the possession of any other person for him;
(b) To administer according to these rules, and, if an executor, according to the will of the
testator, all goods, chattels, rights, credits, and estate which shall at any time come to his
possession or to the possession of any other person for him, and from the proceeds to pay
and discharge all debts, legacies, and charges on the same, or such dividends thereon as
shall be decreed by the court;
(c) To render a true and just account of his administration to the court within one (1) year,
and at any other time when required by the court;
Sec. 4. Bond of special administrator. – A special administrator before entering upon the duties
of his trust shall give a bond, in such sum as the court directs, conditioned that he will make and
return a true inventory of the goods, chattels, rights, credits, and estate of the deceased which
come to his possession or knowledge, and that he will truly account for such as are received by
him when required by the court, and will deliver the same to the person appointed executor or
administrator, or to such other person as may be authorized to receive them.32
A special administrator is an officer of the court who is subject to its supervision and control,
expected to work for the best interest of the entire estate, with a view to its smooth
administration and speedy settlement.33 When appointed, he or she is not regarded as an agent or
representative of the parties suggesting the appointment.34 The principal object of the
appointment of a temporary administrator is to preserve the estate until it can pass to the hands of
a person fully authorized to administer it for the benefit of creditors and heirs, pursuant to
Section 2 of Rule 80 of the Rules of Court.35
While the RTC considered that respondents were the nearest of kin to their deceased parents in
their appointment as joint special administrators, this is not a mandatory requirement for the
appointment. It has long been settled that the selection or removal of special administrators is not
governed by the rules regarding the selection or removal of regular administrators.36 The probate
court may appoint or remove special administrators based on grounds other than those
enumerated in the Rules at its discretion, such that the need to first pass upon and resolve the
issues of fitness or unfitness37 and the application of the order of preference under Section 6 of
Rule 78,38 as would be proper in the case of a regular administrator, do not obtain. As long as the
discretion is exercised without grave abuse, and is based on reason, equity, justice, and legal
principles, interference by higher courts is unwarranted.39 The appointment or removal
of special administrators, being discretionary, is thus interlocutory and may be assailed through a
petition for certiorari under Rule 65 of the Rules of Court.40
Granting the certiorari petition, the CA found that the RTC gravely abused its discretion in
revoking respondents’ appointment as joint special administrators, and for failing to first resolve
the pending Motion for Exemption to File Administrators’ Bond, ratiocinating that the posting of
the administrators’ bond is a pre-requisite to respondents’ entering into the duties and
responsibilities of their designated office. This Court disagrees.
It is worthy of mention that, as early as October 11, 2005, in their Motion for Appointment as
Joint Special Administrators, respondents already prayed for their exemption to post bond should
they be assigned as joint special administrators. However, the RTC effectively denied this prayer
when it issued its June 15, 2006 Order, designating Renato and Dalisay as special administrators
and enjoining them to post bond in the amount of P200,000.00 each. This denial was, in effect,
reiterated when the RTC rendered its February 16, 2007 Order substituting Dalisay with Erlinda
as special administratrix.
Undeterred by the RTC’s resolve to require them to post their respective administrators’ bonds,
respondents filed anew a Motion for Exemption to File Administrators’ Bond on May 22, 2007,
positing that it would be to the best interest of the estate of their deceased parents and all the
heirs to spare the estate from incurring the unnecessary expense of paying for their bond
premiums since they could not raise the money themselves. To note, this Motion was filed only
after petitioners filed a Motion for an Inventory and to Render Account of the Estate on April 23,
2007. Respondents then argued that they could not enter into their duties and responsibilities as
special administrators in light of the pendency of their motion for exemption. In other words,
they could not yet submit an inventory and render an account of the income of the estate since
they had not yet posted their bonds.
Consequently, the RTC revoked respondents’ appointment as special administrators for failing to
post their administrators’ bond and to submit an inventory and accounting as required of them,
tantamount to failing to comply with its lawful orders. Inarguably, this was, again, a denial of
respondents’ plea to assume their office sans a bond. The RTC rightly did so.
Pursuant to Section 1 of Rule 81, the bond secures the performance of the duties and obligations
of an administrator namely: (1) to administer the estate and pay the debts; (2) to perform all
judicial orders; (3) to account within one (1) year and at any other time when required by the
probate court; and (4) to make an inventory within three (3) months. More specifically, per
Section 4 of the same Rule, the bond is conditioned on the faithful execution of the
administration of the decedent’s estate requiring the special administrator to (1) make and return
a true inventory of the goods, chattels, rights, credits, and estate of the deceased which come to
his possession or knowledge; (2) truly account for such as received by him when required by the
court; and (3) deliver the same to the person appointed as executor or regular administrator, or to
such other person as may be authorized to receive them.
Verily, the administration bond is for the benefit of the creditors and the heirs, as it compels the
administrator, whether regular or special, to perform the trust reposed in, and discharge the
obligations incumbent upon, him. Its object and purpose is to safeguard the properties of the
decedent, and, therefore, the bond should not be considered as part of the necessary expenses
chargeable against the estate, not being included among the acts constituting the care,
management, and settlement of the estate. Moreover, the ability to post the bond is in the nature
of a qualification for the office of administration.41
Hence, the RTC revoked respondents’ designation as joint special administrators, especially
considering that respondents never denied that they have been in possession, charge, and actual
administration of the estate of Vicente and Maxima since 2002 up to the present, despite the
assumption of Melinda as regular administratrix. In fact, respondents also admitted that,
allegedly out of good faith and sincerity to observe transparency, they had submitted a Statement
of Cash Distribution42 for the period covering April 2002 to June 2006,43 where they indicated
that Renato had received P4,241,676.00, Erlinda P4,164,526.96, and petitioners P2,486,656.60,
and that the estate had advanced P2,700,000.00 for the hospital and funeral expenses of
Leonardo.44 The latter cash advance was questioned by petitioners in their motion for revocation
of special administration on account of the demand letter45 dated June 20, 2007 of Asian Hospital
and Medical Center addressed to Dalisay, stating that there still remained unpaid hospital bills in
the amount of P2,087,380.49 since January 2004. Undeniably, respondents had already been
distributing the incomes or fruits generated from the properties of the decedents’ estate, yet they
still failed to post their respective administrators’ bonds despite collection of the advances from
their supposed shares. This state of affairs continued even after a considerable lapse of time from
the appointment of Renato as a special administrator of the estate on June 15, 2006 and from
February 16, 2007 when the RTC substituted Erlinda, for Dalisay, as special administratrix.
What is more, respondents’ insincerity in administering the estate was betrayed by the Deed of
Conditional Sale dated January 12, 200446 discovered by petitioners. This Deed was executed
between respondents, as the only heirs of Maxima, as vendors, thus excluding the representing
heirs of Leonardo, and Spouses Marcus Jose B. Brillantes and Amelita Catalan-Brillantes,
incumbent lessors, as vendees, over a real property situated in Biñan, Laguna, and covered by
Transfer Certificate of Title No. T-332305 of the Registry of Deeds of Laguna, for a total
purchase price of P2,700,000.00. The Deed stipulated for a payment of P1,500,000.00 upon the
signing of the contract, and the balance of P1,200,000.00 to be paid within one (1) month from
the receipt of title of the vendees. The contract also stated that the previous contract of lease
between the vendors and the vendees shall no longer be effective; hence, the vendees were no
longer obligated to pay the monthly rentals on the property. And yet there is a purported Deed of
Absolute Sale47 over the same realty between respondents, and including Leonardo as
represented by Dalisay, as vendors, and the same spouses, as vendees, for a purchase price of
only P1,500,000.00. Notably, this Deed of Absolute Sale already had the signatures of
respondents and vendee-spouses. Petitioners claimed that respondents were coaxing Dalisay into
signing the same, while respondents said that Dalisay already got a share from this transaction in
the amount of P500,000.00. It may also be observed that the time of the execution of this Deed
of Absolute Sale, although not notarized as the Deed of Conditional Sale, might not have been
distant from the execution of the latter Deed, considering the similar Community Tax Certificate
Numbers of the parties appearing in both contracts.
Given these circumstances, this Court finds no grave abuse of discretion on the part of the RTC
when it revoked the appointment of respondents as joint special administrators, the removal
being grounded on reason, equity, justice, and legal principle. Indeed, even if special
administrators had already been appointed, once the probate court finds the appointees no longer
entitled to its confidence, it is justified in withdrawing the appointment and giving no valid effect
thereto.48
On the other hand, the Court finds the RTC’s designation of Melinda as regular administratrix
improper and abusive of its discretion.
(a) Is a minor;
xxxx
Sec. 6. When and to whom letters of administration granted. – If no executor is named in the
will, or the executor or executors are incompetent, refuse the trust, or fail to give bond, or a
person dies intestate, administration shall be granted:
(a) To the surviving husband or wife, as the case may be, or next of kin, or both, in the
discretion of the court, or to such person as such surviving husband or wife, or next of
kin, requests to have appointed, if competent and willing to serve;
(b) If such surviving husband or wife, as the case may be, or next of kin, or the person
selected by them, be incompetent or unwilling, or if the husband or widow, or next of kin,
neglects for thirty (30) days after the death of the person to apply for administration or to
request that administration be granted to some other person, it may be granted to one or
more of the principal creditors, if competent and willing to serve;
(c) If there is no such creditor competent and willing to serve, it may be granted to such
other person as the court may select.
Further, on the matter of contest for the issuance of letters of administration, the following
provisions of Rule 79 are pertinent –
Sec. 2. Contents of petition for letters of administration. – A petition for letters of administration
must be filed by an interested person and must show, so far as known to the petitioner:
(b) The names, ages, and residences of the heirs, and the names and residences of the
creditors, of the decedent;
(c) The probable value and character of the property of the estate;
(d) The name of the person for whom letters of administration are prayed.
But no defect in the petition shall render void the issuance of letters of administration.
Sec. 3. Court to set time for hearing. Notice thereof. – When a petition for letters of
administration is filed in the court having jurisdiction, such court shall fix a time and place for
hearing the petition, and shall cause notice thereof to be given to the known heirs and creditors of
the decedent, and to any other persons believed to have an interest in the estate, in the manner
provided in Sections 3 and 4 of Rule 76.
Sec. 4. Opposition to petition for administration. – Any interested person may, by filing a written
opposition, contest the petition on the ground of the incompetency of the person for whom letters
are prayed therein, or on the ground of the contestant’s own right to the administration, and may
pray that letters issue to himself, or to any competent person or persons named in the opposition.
Sec. 5. Hearing and order for letters to issue. – At the hearing of the petition, it must first be
shown that notice has been given as herein-above required, and thereafter the court shall hear the
proofs of the parties in support of their respective allegations, and if satisfied that the decedent
left no will, or that there is no competent and willing executor, it shall order the issuance of
letters of administration to the party best entitled thereto.1avvphi1
Admittedly, there was no petition for letters of administration with respect to Melinda, as the
prayer for her appointment as co-administrator was embodied in the motion for the termination
of the special administration. Although there was a hearing set for the motion on November 5,
2007, the same was canceled and reset to February 8, 2008 due to the absence of the parties’
counsels. The February 8, 2008 hearing was again deferred to March 10, 2008 on account of the
ongoing renovation of the Hall of Justice. Despite the resetting, petitioners filed a
Manifestation/Motion dated February 29, 2008,49 reiterating their prayer for partition or for the
appointment of Melinda as regular administrator and for the revocation of the special
administration. It may be mentioned that, despite the filing by respondents of their Opposition
and Comment to the motion to revoke the special administration, the prayer for the appointment
of Melinda as regular administratrix of the estate was not specifically traversed in the said
pleading. Thus, the capacity, competency, and legality of Melinda’s appointment as such was not
properly objected to by respondents despite being the next of kin to the decedent spouses, and
was not threshed out by the RTC acting as a probate court in accordance with the above
mentioned Rules.
However, having in mind the objective of facilitating the settlement of the estate of Vicente and
Maxima, with a view to putting an end to the squabbles of the heirs, we take into account the fact
that Melinda, pursuant to the RTC Order dated March 13, 2008, already posted the required bond
of P200,000.00 on March 26, 2008, by virtue of which, Letters of Administration were issued to
her the following day, and that she filed an Inventory of the Properties of the Estate dated April
15, 2008.50 These acts clearly manifested her intention to serve willingly as administratrix of the
decedents’ estate, but her appointment should be converted into one of special administration,
pending the proceedings for regular administration. Furthermore, since it appears that the only
unpaid obligation is the hospital bill due from Leonardo’s estate, which is not subject of this
case, judicial partition may then proceed with dispatch.
WHEREFORE, the petition is PARTIALLY GRANTED. The Decision dated December 16,
2008 and the Resolution dated April 30, 2009 of the Court of Appeals in CA-G.R. SP No.
104683 are AFFIRMED with the MODIFICATION that the Order dated March 13, 2008 of the
Regional Trial Court, Branch 24, Biñan, Laguna, with respect to the revocation of the special
administration in favor of Renato M. Ocampo and Erlinda M. Ocampo, is REINSTATED. The
appointment of Melinda Carla E. Ocampo as regular administratrix is SET ASIDE. Melinda is
designated instead as special administratrix of the estate under the same administrator’s bond she
had posted. The trial court is directed to conduct with dispatch the proceedings for the
appointment of the regular administrator and, thereafter, to proceed with judicial partition. No
costs.
SO ORDERED.
WE CONCUR:
ANTONIO T. CARPIO
Associate Justice
Chairperson
ATTESTATION
I attest that the conclusions in the above Decision had been reached in consultation before the
case was assigned to the writer of the opinion of the Court’s Division.
ANTONIO T. CARPIO
Associate Justice
Chairperson, Second Division
CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution and the Division Chairperson's
Attestation, I certify that the conclusions in the above Decision had been reached in consultation
before the case was assigned to the writer of the opinion of the Court’s Division.
RENATO C. CORONA
Chief Justice
9.Source: http://www.lawphil.net/judjuris/juri2010/jul2010/gr_187879_2010.html
Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
DECISION
CORONA, J.:
ART. 332. Persons exempt from criminal liability. – No criminal, but only civil liability shall
result from the commission of the crime of theft, swindling, or malicious mischief committed or
caused mutually by the following persons:
2. The widowed spouse with respect to the property which belonged to the deceased
spouse before the same shall have passed into the possession of another; and
The exemption established by this article shall not be applicable to strangers participating in the
commission of the crime. (emphasis supplied)
For purposes of the aforementioned provision, is the relationship by affinity created between the
husband and the blood relatives of his wife (as well as between the wife and the blood relatives
of her husband) dissolved by the death of one spouse, thus ending the marriage which created
such relationship by affinity? Does the beneficial application of Article 332 cover the complex
crime of estafa thru falsification?
2. As such Administratrix, I am duty bound not only to preserve the properties of the
Intestate Estate of Manolita Carungcong Y Gonzale[s], but also to recover such funds
and/or properties as property belonging to the estate but are presently in the possession or
control of other parties.
3. After my appointment as Administratrix, I was able to confer with some of the children
of my sister Zenaida Carungcong Sato[,] who predeceased our mother Manolita
Carungcong Y Gonzales, having died in Japan in 1991.
4. In my conference with my nieces Karen Rose Sato and Wendy Mitsuko Sato, age[d]
27 and 24 respectively, I was able to learn that prior to the death of my mother Manolita
Carungcong Y Gonzale[s], [s]pecifically on o[r] about November 24, 1992, their father
William Sato, through fraudulent misrepresentations, was able to secure the signature and
thumbmark of my mother on a Special Power of Attorney whereby my niece Wendy
Mitsuko Sato, who was then only twenty (20) years old, was made her attorney-in-fact, to
sell and dispose four (4) valuable pieces of land in Tagaytay City. Said Special Power of
Attorney, copy of which is attached as ANNEX "A" of the Affidavit of Wendy Mitsuko
Sato, was signed and thumbmark[ed] by my mother because William Sato told her that
the documents she was being made to sign involved her taxes. At that time, my mother
was completely blind, having gone blind almost ten (10) years prior to November, 1992.
5. The aforesaid Special Power of Attorney was signed by my mother in the presence of
Wendy, my other niece Belinda Kiku Sato, our maid Mana Tingzon, and Governor
Josephine Ramirez who later became the second wife of my sister’s widower William
Sato.
6. Wendy Mitsuko Sato attests to the fact that my mother signed the document in the
belief that they were in connection with her taxes, not knowing, since she was blind, that
the same was in fact a Special Power of Attorney to sell her Tagaytay properties.
7. On the basis of the aforesaid Special Power of Attorney, William Sato found buyers
for the property and made my niece Wendy Mitsuko Sato sign three (3) deeds of absolute
sale in favor of (a) Anita Ng (Doc. 2194, Page No. 41, Book No. V, Series of 1992 of
Notary Public Vicente B. Custodio), (b) Anita Ng (Doc. No. 2331, Page No. 68, Book
No. V, Series of 1992 of Notary Public Vicente B. Custodio) and (c) Ruby Lee Tsai
(Doc. No. II, Page No. 65, Book No. II, Series of 1993 of Notary Public Toribio D.
Labid). x x x
8. Per the statement of Wendy Mitsuko C. Sato, the considerations appearing on the
deeds of absolute sale were not the true and actual considerations received by her father
William Sato from the buyers of her grandmother’s properties. She attests that Anita Ng
actually paid P7,000,000.00 for the property covered by TCT No. 3148 and
P7,034,000.00 for the property covered by TCT No. 3149. All the aforesaid proceeds
were turned over to William Sato who undertook to make the proper accounting thereof
to my mother, Manolita Carungcong Gonzale[s].
9. Again, per the statement of Wendy Mitsuko C. Sato, Ruby Lee Tsai paid
P8,000,000.00 for the property covered by Tax Declaration No. GR-016-0735, and the
proceeds thereof were likewise turned over to William Sato.
10. The considerations appearing on the deeds of sale were falsified as Wendy Mitsuko
C. Sato has actual knowledge of the true amounts paid by the buyers, as stated in her
Affidavit, since she was the signatory thereto as the attorney-in-fact of Manolita
Carungcong Y Gonzale[s].
11. Wendy was only 20 years old at the time and was not in any position to oppose or to
refuse her father’s orders.
12. After receiving the total considerations for the properties sold under the power of
attorney fraudulently secured from my mother, which total P22,034,000.00, William Sato
failed to account for the same and never delivered the proceeds to Manolita Carungcong
Y Gonzale[s] until the latter died on June 8, 1994.
13. Demands have been made for William Sato to make an accounting and to deliver the
proceeds of the sales to me as Administratrix of my mother’s estate, but he refused and
failed, and continues to refuse and to fail to do so, to the damage and prejudice of the
estate of the deceased Manolita Carungcong Y Gonzale[s] and of the heirs which include
his six (6) children with my sister Zenaida Carungcong Sato. x x x3
Wendy Mitsuko Sato’s supporting affidavit and the special power of attorney allegedly issued by
the deceased Manolita Gonzales vda. de Carungcong in favor of Wendy were attached to the
complaint-affidavit of Mediatrix.
In a resolution dated March 25, 1997, the City Prosecutor of Quezon City dismissed the
complaint.4 On appeal, however, the Secretary of Justice reversed and set aside the resolution
dated March 25, 1997 and directed the City Prosecutor of Quezon City to file an Information
against Sato for violation of Article 315, paragraph 3(a) of the Revised Penal Code.5 Thus, the
following Information was filed against Sato in the Regional Trial Court of Quezon City, Branch
87:6
INFORMATION
The undersigned accuses WILLIAM SATO of the crime of ESTAFA under Article 315[,] par.
3(a) of the Revised Penal Code, committed as follows:
That on or about the 24th day of November, 1992, in Quezon City, Philippines, the above-named
accused, by means of deceit, did, then and there, wil[l]fully, unlawfully and feloniously defraud
MANOLITA GONZALES VDA. DE CARUNGCONG in the following manner, to wit: the said
accused induced said Manolita Gonzales Vda. De Carungcong[,] who was already then blind and
79 years old[,] to sign and thumbmark a special power of attorney dated November 24, 1992 in
favor of Wendy Mitsuko C. Sato, daughter of said accused, making her believe that said
document involved only her taxes, accused knowing fully well that said document authorizes
Wendy Mitsuko C. Sato, then a minor, to sell, assign, transfer or otherwise dispose of to any
person or entity of her properties all located at Tagaytay City, as follows:
1. One Thousand Eight Hundred Seven(ty) One (1,871) square meters more or less and
covered by T.C.T. No. 3147;
2. Five Hundred Forty (540) square meters more or less and covered by T.C.T. No. 3148
with Tax Declaration No. GR-016-0722, Cadastral Lot No. 7106;
3. Five Hundred Forty (540) square meters more or less and covered by T.C.T. No. 3149
with Tax Declaration No. GR-016-0721, Cadastral Lot No. 7104;
4. Eight Hundred Eighty Eight (888) square meters more or less with Tax Declaration
No. GR-016-1735, Cadastral Lot No. 7062;
registered in the name of Manolita Gonzales Vda. De Carungcong, and once in the possession of
the said special power of attorney and other pertinent documents, said accused made Wendy
Mitsuko Sato sign the three (3) Deeds of Absolute Sale covering Transfer Certificate of Title
[TCT] No. 3148 for P250,000.00, [TCT] No. 3149 for P250,000.00 and [Tax Declaration] GR-
016-0735 for P650,000.00 and once in possession of the proceeds of the sale of the above
properties, said accused, misapplied, misappropriated and converted the same to his own
personal use and benefit, to the damage and prejudice of the heirs of Manolita Gonzales Vda. De
Carungcong who died in 1994.
Contrary to law.7
Subsequently, the prosecution moved for the amendment of the Information so as to increase the
amount of damages from P1,150,000, the total amount stated in the deeds of sale, to
P22,034,000, the actual amount received by Sato.
Sato moved for the quashal of the Information, claiming that under Article 332 of the Revised
Penal Code, his relationship to the person allegedly defrauded, the deceased Manolita who was
his mother-in-law, was an exempting circumstance.
The prosecution disputed Sato’s motion in an opposition dated March 29, 2006.
In an order dated April 17, 2006,8 the trial court granted Sato’s motion and ordered the dismissal
of the criminal case:
The Trial Prosecutor’s contention is that the death of the wife of the accused severed the
relationship of affinity between accused and his mother-in-law. Therefore, the mantle of
protection provided to the accused by the relationship is no longer obtaining.
A judicious and thorough examination of Article 332 of the Revised Penal Code convinces this
Court of the correctness of the contention of the [d]efense. While it is true that the death of
Zenaida Carungcong-Sato has extinguished the marriage of accused with her, it does not erase
the fact that accused and Zenaida’s mother, herein complainant, are still son[-in-law] and
mother-in-law and they remained son[-in-law] and mother-in-law even beyond the death of
Zenaida.
Article 332(1) of the Revised Penal Code, is very explicit and states no proviso. "No criminal,
but only civil liability[,] shall result from the commission of the crime of theft, swindling or
malicious mischief committed or caused mutually by xxx 1) spouses, ascendants and
descendants, or relatives by affinity in the same line."
Article 332, according to Aquino, in his Commentaries [to] Revised Penal Code, preserves
family harmony and obviates scandal, hence even in cases of theft and malicious mischief, where
the crime is committed by a stepfather against his stepson, by a grandson against his grandfather,
by a son against his mother, no criminal liability is incurred by the accused only civil (Vicente
Alavare, 52 Phil. 65; Adame, CA 40 OG 12th Supp. 63; Cristobal, 84 Phil. 473).
WHEREFORE, finding the Motion to Quash Original Information meritorious, the same is
GRANTED and, as prayed for, case is hereby DISMISSED.
The prosecution’s motion for reconsideration10 was denied in an order dated June 2, 2006.11
Dissatisfied with the trial court’s rulings, the intestate estate of Manolita, represented by
Mediatrix, filed a petition for certiorari in the Court of Appeals12 which, however, in a decision13
dated August 9, 2007, dismissed it. It ruled:
[W]e sustain the finding of [the trial court] that the death of Zenaida did not extinguish the
relationship by affinity between her husband, private respondent Sato, and her mother Manolita,
and does not bar the application of the exempting circumstance under Article 332(1) of the
Revised Penal Code in favor of private respondent Sato.
We further agree with the submission of the [Office of the Solicitor General (OSG)] that nothing
in the law and/or existing jurisprudence supports the argument of petitioner that the fact of death
of Zenaida dissolved the relationship by affinity between Manolita and private respondent Sato,
and thus removed the protective mantle of Article 332 of the Revised Penal Code from said
private respondent; and that notwithstanding the death of Zenaida, private respondent Sato
remains to be the son-in-law of Manolita, and a brother-in-law of petitioner administratrix. As
further pointed out by the OSG, the filing of the criminal case for estafa against private
respondent Sato already created havoc among members of the Carungcong and Sato families as
private respondent’s daughter Wendy Mitsuko Sato joined cause with her aunt [Mediatrix]
Carungcong y Gonzales, while two (2) other children of private respondent, William Francis and
Belinda Sato, took the side of their father.
Ubi lex non distinguit nec nos distinguere debemos. Basic is the rule in statutory construction
that where the law does not distinguish, the courts should not distinguish. There should be no
distinction in the application of law where none is indicated. The courts could only distinguish
where there are facts or circumstances showing that the lawgiver intended a distinction or
qualification. In such a case, the courts would merely give effect to the lawgiver’s intent. The
solemn power and duty of the Court to interpret and apply the law does not include the power to
correct by reading into the law what is not written therein.
Further, it is an established principle of statutory construction that penal laws are strictly
construed against the State and liberally in favor of the accused. Any reasonable doubt must be
resolved in favor of the accused. In this case, the plain meaning of Article 332 (1) of the Revised
Penal Code’s simple language is most favorable to Sato.14
Petitioner contends that the Court of Appeals erred in not reversing the orders of the trial court. It
cites the commentary of Justice Luis B. Reyes in his book on criminal law that the rationale of
Article 332 of the Revised Penal Code exempting the persons mentioned therein from criminal
liability is that the law recognizes the presumed co-ownership of the property between the
offender and the offended party. Here, the properties subject of the estafa case were owned by
Manolita whose daughter, Zenaida Carungcong-Sato (Sato’s wife), died on January 28, 1991.
Hence, Zenaida never became a co-owner because, under the law, her right to the three
parcels of land could have arisen only after her mother’s death. Since Zenaida predeceased
her mother, Manolita, no such right came about and the mantle of protection provided to
Sato by the relationship no longer existed.
Sato counters that Article 332 makes no distinction that the relationship may not be invoked in
case of death of the spouse at the time the crime was allegedly committed. Thus, while the death
of Zenaida extinguished her marriage with Sato, it did not dissolve the son-in-law and mother-in-
law relationship between Sato and Zenaida’s mother, Manolita.
For his part, the Solicitor General maintains that Sato is covered by the exemption from criminal
liability provided under Article 332. Nothing in the law and jurisprudence supports petitioner’s
claim that Zenaida’s death dissolved the relationship by affinity between Sato and Manolita. As
it is, the criminal case against Sato created havoc among the members of the Carungcong and
Sato families, a situation sought to be particularly avoided by Article 332’s provision exempting
a family member committing theft, estafa or malicious mischief from criminal liability and
reducing his/her liability to the civil aspect only.
The resolution of this case rests on the interpretation of Article 332 of the Revised Penal Code.
In particular, it calls for the determination of the following: (1) the effect of death on the
relationship by affinity created between a surviving spouse and the blood relatives of the
deceased spouse and (2) the extent of the coverage of Article 332.
Article 332 provides for an absolutory cause16in the crimes of theft, estafa (or swindling) and
malicious mischief. It limits the responsibility of the offender to civil liability and frees him from
criminal liability by virtue of his relationship to the offended party.
In connection with the relatives mentioned in the first paragraph, it has been held that included in
the exemptions are parents-in-law, stepparents and adopted children.17 By virtue thereof, no
criminal liability is incurred by the stepfather who commits malicious mischief against his
stepson;18 by the stepmother who commits theft against her stepson;19 by the stepfather who
steals something from his stepson;20 by the grandson who steals from his grandfather;21 by the
accused who swindles his sister-in-law living with him;22 and by the son who steals a ring from
his mother.23
Affinity is the relation that one spouse has to the blood relatives of the other spouse. It is a
relationship by marriage or
a familial relation resulting from marriage.24 It is a fictive kinship, a fiction created by law in
connection with the institution of marriage and family relations.
If marriage gives rise to one’s relationship by affinity to the blood relatives of one’s spouse, does
the extinguishment of marriage by the death of the spouse dissolve the relationship by affinity?
Philippine jurisprudence has no previous encounter with the issue that confronts us in this case.
That is why the trial and appellate courts acknowledged the "dearth of jurisprudence and/or
commentaries" on the matter. In contrast, in the American legal system, there are two views on
the subject. As one Filipino author observed:
In case a marriage is terminated by the death of one of the spouses, there are conflicting views.
There are some who believe that relationship by affinity is not terminated whether there are
children or not in the marriage (Carman vs. Newell, N.Y. 1 [Denio] 25, 26). However, the better
view supported by most judicial authorities in other jurisdictions is that, if the spouses have no
living issues or children and one of the spouses dies, the relationship by affinity is dissolved. It
follows the rule that relationship by affinity ceases with the dissolution of the marriage which
produces it (Kelly v. Neely, 12 Ark. 657, 659, 56 Am Dec. 288). On the other hand, the
relationship by affinity is continued despite the death of one of the spouses where there are living
issues or children of the marriage "in whose veins the blood of the parties are commingled, since
the relationship of affinity was continued through the medium of the issue of the marriage"
(Paddock vs. Wells, 2 Barb. Ch. 331, 333).25
The first view (the terminated affinity view) holds that relationship by affinity terminates with
the dissolution of the marriage either by death or divorce which gave rise to the relationship of
affinity between the parties.26 Under this view, the relationship by affinity is simply coextensive
and coexistent with the marriage that produced it. Its duration is indispensably and necessarily
determined by the marriage that created it. Thus, it exists only for so long as the marriage
subsists, such that the death of a spouse ipso facto ends the relationship by affinity of the
surviving spouse to the deceased spouse’s blood relatives.
The first view admits of an exception. The relationship by affinity continues even after the death
of one spouse when there is a surviving issue.27 The rationale is that the relationship is preserved
because of the living issue of the marriage in whose veins the blood of both parties is
commingled.28
The second view (the continuing affinity view) maintains that relationship by affinity between
the surviving spouse and the kindred of the deceased spouse continues even after the death of the
deceased spouse, regardless of whether the marriage produced children or not.29 Under this view,
the relationship by affinity endures even after the dissolution of the marriage that produced it as a
result of the death of one of the parties to the said marriage. This view considers that, where
statutes have indicated an intent to benefit step-relatives or in-laws, the "tie of affinity" between
these people and their relatives-by-marriage is not to be regarded as terminated upon the death of
one of the married parties.30
After due consideration and evaluation of the relative merits of the two views, we hold that the
second view is more consistent with the language and spirit of Article 332(1) of the Revised
Penal Code.
First, the terminated affinity view is generally applied in cases of jury disqualification
and incest.31 On the other hand, the continuing affinity view has been applied in the
interpretation of laws that intend to benefit step-relatives or in-laws. Since the purpose of
the absolutory cause in Article 332(1) is meant to be beneficial to relatives by affinity
within the degree covered under the said provision, the continuing affinity view is more
appropriate.
Second, the language of Article 332(1) which speaks of "relatives by affinity in the same
line" is couched in general language. The legislative intent to make no distinction
between the spouse of one’s living child and the surviving spouse of one’s deceased child
(in case of a son-in-law or daughter-in-law with respect to his or her parents-in-law)32 can
be drawn from Article 332(1) of the Revised Penal Code without doing violence to its
language.
Third, the Constitution declares that the protection and strengthening of the family as a
basic autonomous social institution are policies of the State and that it is the duty of the
State to strengthen the solidarity of the family.33 Congress has also affirmed as a State
and national policy that courts shall preserve the solidarity of the family.34 In this
connection, the spirit of Article 332 is to preserve family harmony and obviate scandal.35
The view that relationship by affinity is not affected by the death of one of the parties to
the marriage that created it is more in accord with family solidarity and harmony.
Intimately related to the in dubio pro reo principle is the rule of lenity.38 The rule applies when
the court is faced with two possible interpretations of a penal statute, one that is prejudicial to the
accused and another that is favorable to him. The rule calls for the adoption of an interpretation
which is more lenient to the accused.
Lenity becomes all the more appropriate when this case is viewed through the lens of the basic
purpose of Article 332 of the Revised Penal Code to preserve family harmony by providing an
absolutory cause. Since the goal of Article 332(1) is to benefit the accused, the Court should
adopt an application or interpretation that is more favorable to the accused. In this case, that
interpretation is the continuing affinity view.
Thus, for purposes of Article 332(1) of the Revised Penal Code, we hold that the relationship by
affinity created between the surviving spouse and the blood relatives of the deceased spouse
survives the death of either party to the marriage which created the affinity. (The same principle
applies to the justifying circumstance of defense of one’s relatives under Article 11[2] of the
Revised Penal Code, the mitigating circumstance of immediate vindication of grave offense
committed against one’s relatives under Article 13[5] of the same Code and the absolutory cause
of relationship in favor of accessories under Article 20 also of the same Code.)
The absolutory cause under Article 332 of the Revised Penal Code only applies to the felonies of
theft, swindling and malicious mischief. Under the said provision, the State condones the
criminal responsibility of the offender in cases of theft, swindling and malicious mischief. As an
act of grace, the State waives its right to prosecute the offender for the said crimes but leaves the
private offended party with the option to hold the offender civilly liable.
However, the coverage of Article 332 is strictly limited to the felonies mentioned therein. The
plain, categorical and unmistakable language of the provision shows that it applies exclusively to
the simple crimes of theft, swindling and malicious mischief. It does not apply where any of the
crimes mentioned under Article 332 is complexed with another crime, such as theft through
falsification or estafa through falsification.39
The Information against Sato charges him with estafa. However, the real nature of the offense is
determined by the facts alleged in the Information, not by the designation of the offense.40 What
controls is not the title of the Information or the designation of the offense but the actual facts
recited in the Information.41 In other words, it is the recital of facts of the commission of the
offense, not the nomenclature of the offense, that determines the crime being charged in the
Information.42 It is the exclusive province of the court to say what the crime is or what it is
named.43 The determination by the prosecutor who signs the Information of the crime committed
is merely an opinion which is not binding on the court.44
A reading of the facts alleged in the Information reveals that Sato is being charged not with
simple estafa but with the complex crime of estafa through falsification of public documents. In
particular, the Information states that Sato, by means of deceit, intentionally defrauded Manolita
committed as follows:
(a) Sato presented a document to Manolita (who was already blind at that time) and
induced her to sign and thumbmark the same;
(b) he made Manolita believe that the said document was in connection with her taxes
when it was in fact a special power of attorney (SPA) authorizing his minor daughter
Wendy to sell, assign, transfer or otherwise dispose of Manolita’s properties in Tagaytay
City;
(c) relying on Sato’s inducement and representation, Manolita signed and thumbmarked
the SPA in favor of Wendy Mitsuko Sato, daughter of Sato;
(d) using the document, he sold the properties to third parties but he neither delivered the
proceeds to Manolita nor accounted for the same and
(d) despite repeated demands, he failed and refused to deliver the proceeds, to the damage
and prejudice of the estate of Manolita.
The above averments in the Information show that the estafa was committed by attributing to
Manolita (who participated in the execution of the document) statements other than those in fact
made by her. Manolita’s acts of signing the SPA and affixing her thumbmark to that document
were the very expression of her specific intention that something be done about her taxes. Her
signature and thumbmark were the affirmation of her statement on such intention as she only
signed and thumbmarked the SPA (a document which she could not have read) because of Sato’s
representation that the document pertained to her taxes. In signing and thumbmarking the
document, Manolita showed that she believed and adopted the representations of Sato as to what
the document was all about, i.e., that it involved her taxes. Her signature and thumbmark,
therefore, served as her conformity to Sato’s proposal that she execute a document to settle her
taxes.
Thus, by inducing Manolita to sign the SPA, Sato made it appear that Manolita granted his
daughter Wendy a special power of attorney for the purpose of selling, assigning, transferring or
otherwise disposing of Manolita’s Tagaytay properties when the fact was that Manolita signed
and thumbmarked the document presented by Sato in the belief that it pertained to her taxes.
Indeed, the document itself, the SPA, and everything that it contained were falsely attributed to
Manolita when she was made to sign the SPA.
(1) "once in the possession of the said special power of attorney and other pertinent
documents, [Sato] made Wendy Mitsuko Sato sign the three (3) Deeds of Absolute Sale"
and
(2) "once in possession of the proceeds of the sale of the above properties, said accused,
misapplied, misappropriated and converted the same to his own personal use and benefit"
raise the presumption that Sato, as the possessor of the falsified document and the one
who benefited therefrom, was the author thereof.
Furthermore, it should be noted that the prosecution moved for the amendment of the
Information so as to increase the amount of damages from P1,150,000 to P22,034,000. This was
granted by the trial court and was affirmed by the Court of Appeals on certiorari. This meant that
the amended Information would now state that, while the total amount of consideration stated in
the deeds of absolute sale was only P1,150,000, Sato actually received the total amount of
P22,034,000 as proceeds of the sale of Manolita’s properties.45 This also meant that the deeds of
sale (which were public documents) were also falsified by making untruthful statements as to the
amounts of consideration stated in the deeds.
Therefore, the allegations in the Information essentially charged a crime that was not simple
estafa. Sato resorted to falsification of public documents (particularly, the special power of
attorney and the deeds of sale) as a necessary means to commit the estafa.
Since the crime with which respondent was charged was not simple estafa but the complex crime
of estafa through falsification of public documents, Sato cannot avail himself of the absolutory
cause provided under Article 332 of the Revised Penal Code in his favor.
Effect of Absolutory Cause Under Article 332 on Criminal Liability For The Complex
Crime of Estafa Through Falsification of Public Documents
The question may be asked: if the accused may not be held criminally liable for simple estafa by
virtue of the absolutory cause under Article 332 of the Revised Penal Code, should he not be
absolved also from criminal liability for the complex crime of estafa through falsification of
public documents? No.
True, the concurrence of all the elements of the two crimes of estafa and falsification of public
document is required for a proper conviction for the complex crime of estafa through
falsification of public document. That is the ruling in Gonzaludo v. People.46 It means that the
prosecution must establish that the accused resorted to the falsification of a public document as a
necessary means to commit the crime of estafa.
However, a proper appreciation of the scope and application of Article 332 of the Revised Penal
Code and of the nature of a complex crime would negate exemption from criminal liability for
the complex crime of estafa through falsification of public documents, simply because the
accused may not be held criminally liable for simple estafa by virtue of the absolutory cause
under Article 332.
The absolutory cause under Article 332 is meant to address specific crimes against property,
namely, the simple crimes of theft, swindling and malicious mischief. Thus, all other crimes,
whether simple or complex, are not affected by the absolutory cause provided by the said
provision. To apply the absolutory cause under Article 332 of the Revised Penal Code to one of
the component crimes of a complex crime for the purpose of negating the existence of that
complex crime is to unduly expand the scope of Article 332. In other words, to apply Article 332
to the complex crime of estafa through falsification of public document would be to mistakenly
treat the crime of estafa as a separate simple crime, not as the component crime that it is in that
situation. It would wrongly consider the indictment as separate charges of estafa and falsification
of public document, not as a single charge for the single (complex) crime of estafa through
falsification of public document.
Under Article 332 of the Revised Penal Code, the State waives its right to hold the offender
criminally liable for the simple crimes of theft, swindling and malicious mischief and considers
the violation of the juridical right to property committed by the offender against certain family
members as a private matter and therefore subject only to civil liability. The waiver does not
apply when the violation of the right to property is achieved through (and therefore inseparably
intertwined with) a breach of the public interest in the integrity and presumed authenticity of
public documents. For, in the latter instance, what is involved is no longer simply the
property right of a family relation but a paramount public interest.
The purpose of Article 332 is to preserve family harmony and obviate scandal.47 Thus, the action
provided under the said provision simply concerns the private relations of the parties as family
members and is limited to the civil aspect between the offender and the offended party. When
estafa is committed through falsification of a public document, however, the matter acquires a
very serious public dimension and goes beyond the respective rights and liabilities of family
members among themselves. Effectively, when the offender resorts to an act that breaches public
interest in the integrity of public documents as a means to violate the property rights of a family
member, he is removed from the protective mantle of the absolutory cause under Article 332.
In considering whether the accused is liable for the complex crime of estafa through falsification
of public documents, it would be wrong to consider the component crimes separately from each
other. While there may be two component crimes (estafa and falsification of documents), both
felonies are animated by and result from one and the same criminal intent for which there is only
one criminal liability.48 That is the concept of a complex crime. In other words, while there are
two crimes, they are treated only as one, subject to a single criminal liability.
As opposed to a simple crime where only one juridical right or interest is violated (e.g., homicide
which violates the right to life, theft which violates the right to property),49 a complex crime
constitutes a violation of diverse juridical rights or interests by means of diverse acts, each of
which is a simple crime in itself.50 Since only a single criminal intent underlies the diverse acts,
however, the component crimes are considered as elements of a single crime, the complex crime.
This is the correct interpretation of a complex crime as treated under Article 48 of the Revised
Penal Code.
In the case of a complex crime, therefore, there is a formal (or ideal) plurality of crimes where
the same criminal intent results in two or more component crimes constituting a complex crime
for which there is only one criminal liability.51 (The complex crime of estafa through falsification
of public document falls under this category.) This is different from a material (or real) plurality
of crimes where different criminal intents result in two or more crimes, for each of which the
accused incurs criminal liability.52 The latter category is covered neither by the concept of
complex crimes nor by Article 48.
Under Article 48 of the Revised Penal Code, the formal plurality of crimes (concursus
delictuorum or concurso de delitos) gives rise to a single criminal liability and requires the
imposition of a single penalty:
Although [a] complex crime quantitatively consists of two or more crimes, it is only one crime in
law on which a single penalty is imposed and the two or more crimes constituting the same are
more conveniently termed as component crimes.53 (emphasis supplied)
—∞——∞——∞—
In [a] complex crime, although two or more crimes are actually committed, they constitute only
one crime in the eyes of the law as well as in the conscience of the offender. The offender has
only one criminal intent. Even in the case where an offense is a necessary means for committing
the other, the evil intent of the offender is only one.54
For this reason, while a conviction for estafa through falsification of public document requires
that the elements of both estafa and falsification exist, it does not mean that the criminal liability
for estafa may be determined and considered independently of that for falsification. The two
crimes of estafa and falsification of public documents are not separate crimes but component
crimes of the single complex crime of estafa and falsification of public documents.
Therefore, it would be incorrect to claim that, to be criminally liable for the complex crime of
estafa through falsification of public document, the liability for estafa should be considered
separately from the liability for falsification of public document. Such approach would disregard
the nature of a complex crime and contradict the letter and spirit of Article 48 of the Revised
Penal Code. It would wrongly disregard the distinction between formal plurality and material
plurality, as it improperly treats the plurality of crimes in the complex crime of estafa through
falsification of public document as a mere material plurality where the felonies are considered as
separate crimes to be punished individually.
Falsification of Public Documents May Be a Necessary Means for Committing Estafa Even
Under Article 315 (3[a])
The elements of the offense of estafa punished under Article 315 (3[a]) of the Revised Penal
Code are as follows:
(2) deceit was employed to make the offended party sign the document;
While in estafa under Article 315(a) of the Revised Penal Code, the law does not require that the
document be falsified for the consummation thereof, it does not mean that the falsification of the
document cannot be considered as a necessary means to commit the estafa under that provision.
The phrase "necessary means" does not connote indispensable means for if it did, then the
offense as a "necessary means" to commit another would be an indispensable element of the
latter and would be an ingredient thereof.55 In People v. Salvilla,56 the phrase "necessary means"
merely signifies that one crime is committed to facilitate and insure the commission of the
other.57 In this case, the crime of falsification of public document, the SPA, was such a
"necessary means" as it was resorted to by Sato to facilitate and carry out more effectively his
evil design to swindle his mother-in-law. In particular, he used the SPA to sell the Tagaytay
properties of Manolita to unsuspecting third persons.
Applying the above principles to this case, the allegations in the Information show that the
falsification of public document was consummated when Sato presented a ready-made SPA to
Manolita who signed the same as a statement of her intention in connection with her taxes. While
the falsification was consummated upon the execution of the SPA, the consummation of the
estafa occurred only when Sato later utilized the SPA. He did so particularly when he had the
properties sold and thereafter pocketed the proceeds of the sale. Damage or prejudice to Manolita
was caused not by the falsification of the SPA (as no damage was yet caused to the property
rights of Manolita at the time she was made to sign the document) but by the subsequent use of
the said document. That is why the falsification of the public document was used to facilitate and
ensure (that is, as a necessary means for) the commission of the estafa.
The situation would have been different if Sato, using the same inducement, had made Manolita
sign a deed of sale of the properties either in his favor or in favor of third parties. In that case, the
damage would have been caused by, and at exactly the same time as, the execution of the
document, not prior thereto. Therefore, the crime committed would only have been the simple
crime of estafa.63 On the other hand, absent any inducement (such as if Manolita herself had been
the one who asked that a document pertaining to her taxes be prepared for her signature, but what
was presented to her for her signature was an SPA), the crime would have only been the simple
crime of falsification.64
WHEREFORE, the petition is hereby GRANTED. The decision dated August 9, 2007 and the
resolution dated January 23, 2008 of the Court of Appeals in CA-G.R. S.P. No. 95260 are
REVERSED and SET ASIDE. The case is remanded to the trial court which is directed to try
the accused with dispatch for the complex crime of estafa through falsification of public
documents.
SO ORDERED.
RENATO C. CORONA
Associate Justice
Chairperson
WE CONCUR:
ANTONIO EDUARDO B.
PRESBITERO J. VELASCO, JR.
NACHURA
Associate Justice
Associate Justice
ATTESTATION
I attest that the conclusions in the above Decision had been reached in consultation before the
case was assigned to the writer of the opinion of the Court’s Division.
RENATO C. CORONA
Associate Justice
Chairperson
CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution, I certify that the conclusions in the
above Decision had been reached in consultation before the case was assigned to the writer of the
opinion of the Court’s Division.
REYNATO S. PUNO
Chief Justice
10.Source: http://www.lawphil.net/judjuris/juri2010/feb2010/gr_181409_2010.html