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TRC vs. Heirs of Alvarez (Week 6)

The Supreme Court ruled that the oral donation of land from Rodolfo Alvarez's parents to him was valid. While oral donations of land are normally invalid, courts will recognize oral partitions that have been acted upon, as was the case here. Rodolfo built a home on the land in 1975 and his heirs continued occupying it. Therefore, the spouses Zarate could not claim ownership over the portion of land belonging to Rodolfo's heirs. The mortgage and sale documents involving the spouses Zarate related to a property they did not own.

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65 views2 pages

TRC vs. Heirs of Alvarez (Week 6)

The Supreme Court ruled that the oral donation of land from Rodolfo Alvarez's parents to him was valid. While oral donations of land are normally invalid, courts will recognize oral partitions that have been acted upon, as was the case here. Rodolfo built a home on the land in 1975 and his heirs continued occupying it. Therefore, the spouses Zarate could not claim ownership over the portion of land belonging to Rodolfo's heirs. The mortgage and sale documents involving the spouses Zarate related to a property they did not own.

Uploaded by

John Mark Revilla
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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TOPIC: DONATION

TECHNOLOGY RESOURCE CENTER vs. HEIRS OF ALVAREZ


G.R. NO. 214410
AUGUST 3, 2022.
HERNANDO, J.

FACTS

The subject of the controversy pertained to the ownership of a parcel of land located
in Barrio Maahas, Los Baños, Laguna and claimed to be under the name of Rodolfo Manipol
Alvarez (Rodolfo). Rodolfo was married to Beatriz Alvarez (Beatriz) with whom he has three
children. TRC, formerly known as Technology and Livelihood Resources Center, to which
the subject property was mortgaged by the spouses Zarate. Fidela is the sister of Rodolfo,
who likewise claimed ownership over the subject property.

Heirs of Alvarez’s Version

Respondents filed a complaint for annulment of Real Estate Mortgage, Deed of


Absolute Sale, and all proceedings or documents of alleged ownership, partition with
damages, and prayer for the issuance of writ of preliminary injunction, against Spouses
Zarate and petitioner corporation. They alleged that Rodolfo’s parents had several properties,
all of which were distributed by "toka" (oral giving), during their lifetime, among their
children. Of these properties, one half (1/2) of the property located in Maahas, Los Baños,
Laguna was given to Rodolfo while the other half thereof was given to Fidela Zarate.

Upon receipt of his share, Rodolfo built a house on his share in 1975 and has lived
therein with his family who continue occupying the same up to the present. After the death of
Rodolfo in the year 2001, Beatriz went to the Assessor's Office and discovered that her
husband's share has been transferred in the name of Spouses Zarate.

Spouses Zarate

Pablo Zarate, chairman of Princesa Cotton Corporation, contracted a Loan Agreement


from petitioner TRC. Princesa Cotton Corporation and co-mortgagors (Sps. Zarate), executed
a Mortgage Contract in favor of petitioner TRC. Said mortgage in favor of TRC were duly
annotated on the TCTs and Tax Declaration of the mortgaged properties.

Borrower/mortgagor Princesa Cotton Corporation, incurred default in the payment of


its loan obligations. Borrower/Mortgagor Princesa Cotton Corporation still continued to fail
to pay its loan obligations to TRC on its due date/s despite repeated demands for payment,
thereby expressly violated the terms and conditions of the Loan Agreement, Mortgage
Contract, Promissory Notes, and other loan-related documents that it has executed in favor of
TRC. Hence, TRC undertook the foreclosure of the mortgaged properties.

Ruling of the RTC

The RTC dismissed the complaint. It held that the essential requisites for the validity
of a donation of an immovable property provided under Article 749 of the Civil Code must be
complied with, and failure to comply with the same will render the donation void ab initio. In
this case, the trial court found the donation of the subject property made in favor of the heirs
of Rodolfo void for failure to comply with the formalities provided by law.

However, it declared the Deed of Absolute Sale a valid deed of conveyance executed
in favor of the spouses Zarate as it contains all the essential elements of a valid contract, and
that it complied with all the formalities required by law. Since the Zarates are found to be the
absolute owners of the subject mortgaged property, the real estate mortgage executed in favor
of TRC is considered valid as it complied with all the legal requisites provided under Article
2085 of the Civil Code.

Ruling of the CA

The CA reversed and set aside the decision of the RTC.

The appellate court upheld the validity of the oral donation made in favor of the heirs
of Rodolfo over the subject property. It is not required that the partition agreement be
registered or annotated to be valid. What is important is that the acts of ownership are
exercised over the subject property, making the parties estopped from denying the existence
of the oral partition.

ISSUE & RULING

WHETHER OR NOT THE ORAL DONATION WAS VALID (YES)

The Court disagrees.

In the case of Heirs of Jarque v. Jarque, it was stressed that courts of equity have
enforced oral partition when it has been completely or partly performed, viz.:

Regardless of whether a parol partition or agreement to partition is valid and


enforceable at law, equity will in proper cases, where the parol partition has actually been
consummated by the taking of possession in severalty and the exercise of ownership by the
parties of the respective portions set off to each, recognize and enforce such parol partition
and the rights of the parties thereunder. Thus, it has been held or stated in a number of cases
involving an oral partition under which the parties went into possession, exercised acts of
ownership, or otherwise partly performed the partition agreement, that equity will confirm
such partition and in a proper case decree title in accordance with the possession in severalty

In this case, the ownership of the subject property is established by evidence. The
records show that during the lifetime of the spouses Alvarez, half of the property located in
Maahas, Los Baños, Laguna was given by "toka" to Rodolfo while the other half to Fidela
Zarate. Upon receipt of his share, Rodolfo built a house in 1975 and his heirs continue to
occupy the same up to the present.

Hence, the spouses Zarate can no longer lay claim on the one-half share of the
respondents in the subject property since they knew that prior to the execution of the alleged
deed of sale, the respondents have already been occupying the subject property. Moreover,
they can no longer question the validity of such oral partition as its validity is well settled in
Our jurisdiction.

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