[REQUISITES OF TRUST]

Case Citation: G.R. No. L-49087

Date: April 5, 1982

Petitioners: MINDANAO DEVELOPMENT AUTHORITY, now the SOUTHERN PHILIPPINES

Respondents: THE COURT OF APPEALS and FRANCISCO ANG BANSING, respondents

Doctrine:

Subject matter of Lot 1846-C

Antecedent Facts: Franciso Bansing was the owner of a big land (300,000 sqm, located at Barrio Panacan Davao
City).
Feb. 25, 1939: Bansing sold a portion (5 hectares thereof) to Juan Cruz Yap Chuy.
 The contract provided, among others, the following:
o [Par. 6 of the deed of sale] That I hereby agree to work for the titling of the
entire area of my land under my own expenses and the expenses for the titling
of the portion sold to me shall be under the expenses of Juan Cruz Yap Chuy.
(TAKE NOTE OF THIS)

After the sale, the land of Bansing was surveyed and designated as Lot 664-B. Lot 664-B was
subdivided into 5 and the portion sold to Juan Cruz was designated as Lot 1846-C of the Davao
Cadastre.

Dec. 23, 1939: Juan Cruz sold Lot 1846-C to the Commonwealth of the Philippines.
 On that same day, Juan Cruz, as vendor, and C.B. Cam and Miguel N. Lansona as
sureties, executed a surety bond in favor of the vendee to guarantee the vendor's
absolute title over the land sold.

There was numerous transfers of portions of the original 30-hectare parcel of land of Ang
Bansing to Juan Cruz and the issuance of certificates of title in the name of Juan Cruz. After
these conveyances, there remained in the possession of Ang Bansing under TCT No. 2601, Lot
1846-C, the lot in question; Lot 1846-D; and Lot 1846-E. However, TCT No. 2601 was again
partially cancelled when Ang Bansing sold Lot 1846-D to Vedasto Corcuera.

Feb. 25, 1965: the President of the Philippines issued Proclamation No. 459, transferring
ownership of certain parcels of land to the Mindanao Development Authority (now the Southern
Philippines Development Administration) subject to private rights, if any.
 Lot 1846-C, the disputed land, was among the parcels of land transferred to the
Mindanao Development Authority in said proclamation.

March 31, 1969: MDA wrote Bansing requesting the latter to surrender the Owner's duplicate
copy of TCT No. 2601 so that the subject land (Lot 1846-C) could be formally transferred to his
client but Ang Bansing refused.

April 11, 1969: MDA filed a complaint against Bansing before the CFI for the reconveyance of
the title over Lot 1846-C.
Allegations:
 That the deed of sale, it was stipulated by the parties that the defendant would work to
secure title of his entire tract of land of about 30 hectares defraying the expenses for the
same and the expenses for the title of the portion sold by the defendant to Juan Cruz
Yap Chuy shall be borned by the latter;
 That the defendant as vendor and the one who worked to secure the title of his entire
tract of land which included the portion sold by him to Juan Cruz Yap Chuy acted in the
capacity of and/or served as trustee for any and all parties who become successor-in-
interest to Juan Cruz Yap Chuy and the defendant was bound and obligated to give,
deliver and reconvey to Juan Cruz Yap Chuy and/or his successor-in-interest the title
 pertaining to the portion of land sold and conveyed by him to Juan Cruz Yap Chuy by
virtue of the deed of sale and his affidavit.

Bansing:
 In the process of defendant's securing his title neither Juan Cruz Yap Chuy nor the
Commonwealth asserted any right to ownership of the subject property and that was
almost 30 years ago until plaintiff filed its complaint, thus plaintiff is forever barred from
claiming any right over the subject property.
 There was no real sale made but only the intention to sell a portion of the land
 Defendant denies allegations that he acted as the trustee of Juan Cruz Yap Chuy
Defendant was never such; matter of fact Juan Cruz Yap Chuy for the last 26 years,
until he died in October, 1965, never made any demand to have the title of the subject
property transferred in his name because he knew all the time that the alleged sale in
his favor was per se null and void he also knew that no sale was ever consummated.

CFI ruling: An express trust was established and ordered the reconveyance of the title to Lot
1846-C of the Davao Cadastre to MDA.
 Bansing appealed to the CA. He contended that no express trust was created.

CA ruling: Reversed the judgement and dismissed the complaint.

Issue: WON a trust was created. NO.

SC Ruling: (No express trust had been created between Ang Banging and Juan Cruz over the subject land.
Only an implied trust was created but the action for reconveyance already prescribed and the
enforcement of the constructive trust was barred by laches.)

Trusts are either express or implied. Express trusts are created by the intention of the trustor or
of the parties. Implied trusts come into being by operation of law.

The elements before an express trust will be recognized are a competent trustor and trustee,
an ascertainable trust res, and sufficiently certain beneficiaries.
 Stilted formalities are unnecessary, but nevertheless each of the above elements is
required to be established, and, if any one of them is missing, it is fatal to the trusts.
 Furthermore, there must be a present and complete disposition of the trust property,
notwithstanding that the enjoyment in the beneficiary will take place in the future.
 It is essential, too, that the purpose be an active one to prevent trust from being
executed into a legal estate or interest, and one that is not in contravention of some
prohibition of statute or rule of public policy.
 There must also be some power of administration other than a mere duty to perform a
contract although the contract is for a third-party beneficiary.
 A declaration of terms is essential, and these must be stated with reasonable certainty
in order that the trustee may administer, and that the court, if called upon so to do, may
enforce, the trust.

In this case, the condition relied upon petitioner is nothing but a condition that Ang Bansing
shall pay the expenses for the registration of his land and for Juan Cruz to shoulder the
expenses for the registration of the land sold to him.
 The stipulation does not categorically create an obligation on the part of Bansing to hold
the property in trust for Juan Cruz. Hence, there is no express trust.
 It is essential to the creation of an express trust that the settlor presently and
unequivocally make a disposition of property and make himself the trustee of the
property for the benefit of another.

In case of a declaration of trust, the declaration must be clear and unequivocal that the owner
holds property in trust for the purposes named.
 While Bansing agreed in the deed of sale that he will work for the titling of "the entire
area of my land under my own expenses," it is not clear therefrom whether said
statement refers to the 30-hectare parcel of land or to that portion left to him after the
sale.
  A failure on the part of the settlor definitely to describe the subject-matter of the
supposed trust or the beneficiaries or object thereof is strong evidence that he
intended no trust.

The intent to create a trust must be definite and particular. It must show a desire to pass
benefits through the medium of a trust, and not through some related or similar device.

Clear and unequivocal language is necessary to create a trust and mere precatory language and
statements of ambiguous nature, are not sufficient to establish a trust.
 A trust must be proven by clear, satisfactory and convincing evidence; it cannot rest on
vague and uncertain evidence or on loose, equivocal or indefinite declarations. (De
Leon vs. Packson)
 Considering that the trust intent has not been expressed with such clarity and
definiteness, no express trust can be deduced from the stipulation aforequoted.

Nor will the affidavit executed by Bansing on April 23, 1941 be construed as having established
an express trust.
 The only purpose of the Affidavit was to clarify that the area of the land sold by Ang
Bansing to Juan Cruz Yap Chuy is not only 5 hectares but 61,107 square meters or a
little over six (6) hectares.

That no express trust had been agreed upon by Bansing and Juan Cruz is evident from the fact
that Juan Cruz, the supposed beneficiary of the trust, never made any attempt to enforce the
alleged trust and require the trustee to transfer the title over Lot 1846-C in his name.
 Despite numerous transfers of portions of the original 30-hectare parcel of land of Ang
Bansing to Juan Cruz and the issuance of certificates of title in the name of Juan Cruz,
the latter never sought the transfer of the title to Lot 1846-C in his name.
 If the parties had agreed that Bansing shall hold the property in trust for Juan Cruz until
after the former shall have obtained a certificate of title to the land, the latter would have
asked for the reconveyance of the title to him in view of the surety bond executed by him
in favor of the Commonwealth Government wherein he warrants his title over the
property.
 The conduct of Juan Cruz is inconsistent with a trust and may well have probative effect
against a trust.

But, even granting, arguendo, that an express trust had been established, it would appear
that the trustee had repudiated the trust and the petitioner, the alleged beneficiary to the trust,
did not take any action until after the lapse of 23 years.
 After the last war the City Engineer's Office of Davao City made repeated demands on
the defendants for the delivery and conveyance to the Commonwealth Government of
the title of land in question, Lot 1846-C, but the defendant ignored and evaded the
same.
 Considering that the demand was made in behalf of the Commonwealth Government, it
is obvious that the said demand was made before July 4, 1946, when the
Commonwealth Government was dismantled and the Republic of the Philippines came
into being. From 1946 to 1969, when the action for reconveyance was filed with the
Court, 23 years had passed. For sure, the period for enforcing the rights of the alleged
beneficiary over the land in question after the repudiation of the trust by the trustee, had
already prescribed.

Only an implied trust may have been impressed upon the title of Bansing over the subject land
since the land in question was registered in his name although the land belonged to another.
 In implied trusts, there is neither promise nor fiduciary relations, the so-called trustee
does not recognize any trust and has no intent to hold the property for the beneficiary.
 It does not arise by agreement or intention, but by operation of law.

Thus, if property is acquired through mistake or fraud, the person obtaining it is, by force of law,
considered a trustee of an implied trust for the benefit of the person from whom the property
comes.
 If a person obtains legal title to property by fraud or concealment, courts of equity will
 impress upon the title a so-called constructive trust in favor of the defrauded party.

There is also a constructive trust if a person sells a parcel of land and thereafter obtains title to
it through fraudulent misrepresentation.
 Such a constructive trust is not a trust in the technical sense and is prescriptible; it
prescribes in 10 years.

Here, the 10-year prescriptive period began on March 31, 1941, upon the issuance of Original
Certificate of Title No. 26 in the names of Victoriana Ang Bansing Orfelina Ang Bansing and
Francisco Ang Banging. From that date up to April 11, 1969, when the complaint for
reconveyance was filed, more than 28 years had passed. Clearly, the action for reconveyance
had prescribed.

Further, the enforcement of the constructive trust that may have been impressed upon the title of
Ang Bansing over the subject land is barred by laches.
 The deed of sale in favor of the Commonwealth Government was executed by Juan
Cruz on December 23, 1939, during the cadastral proceedings, and even before the
cadastral survey plan was approved by the Director of Lands on July 10, 1940. But, the
vendee therein did not file an answer, much less an opposition to the answer of Ang
Bansing in the said Cadastral proceedings.
 The judgment rendered in the said cadastral proceeding, awarding the lot in question to
Ang Bansing is already final.
 After an inexcusable delay of more than 28 years and acquiescence to existing
conditions, it is now too late for the petitioner to complain.