G.R. No.

196023

April 21, 2014

JOSE JUAN TONG, ET AL., Petitioners,

vs.
GO TIAT KUN, ET AL., Respondents.

FACTS: Juan Tong and Sy Un had 10 children. In 1957, Juan Tong informed his
children of his intention to purchase Lot 998 for the familys lumber business. Since
he was a Chinese citizen he was disqualified from acquiring said lot, the title to the
property will be registered in the name of his eldest son, Luis, Sr., who at that time
was already of age and was the only Filipino citizen among them. On May, 1957
Juan Tong bought the land and was registered in the name of Luis, Sr. Years later,
Sy Un and Juan Tong both died intestate.
On May 30, 1981, Luis, Sr. died and his heirs (Go Tiat Kun and children) claimed
ownership over Lot 998 by succession alleging that no trust exists and it was Luis,
Sr. who bought Lot 998. They subdivided the land and sold (Lot 998-B) to third
persons. On August 1995, petitioners discovered the breach of trust committed by
respondents resulting in their filing for annulment of sales. RTC ruled in favor of
petitioners which was affirmed by CA and Supreme Court.
On February 2001, Go Tiat Kun executed a Deed of Sale over Lot 998-A in favor of
her children. Petitioners filed for nullification of titles claiming they are owners of Lot
998-A.
Trial Court ruled in favor of petitioners saying that Luis, Sr., was a mere trustee and
not the owner of Lot 998. Therefore respondents can not appropriate the property
among themselves. Thus all previous titles and documents of reconveyance are null
and void.
CA reversed the decision saying that an express trust was created because there
was a direct and positive act from Juan Tong to create a trust. It also ruled that
petitioners are still barred by prescription because said resulting trust was
terminated upon death of Luis, Sr. and was converted into constructive trust. Thus
this petition for review.
ISSUE: (1) Whether or not there was an implied resulting trust constituted over Lot
998 when Juan Tong purchased the property and registered it in the name of Luis,
Sr.
(2) Whether or not the petitioners action barred by prescription, estoppel and
laches.
HELD: (1) There was an implied trust as already decided in a previous case involving
Lot 998-B. Trial court already found that said lot was held in trust by Luis, Sr., in
favor of his siblings by a vrtue of an implied trust which was affirmed by SC.
Although Lot 998 was titled in the name of Luis, Sr., the circumstances surrounding
the acquisition of the subject property eloquently speak of the intent that the

equitable or beneficial ownership of the property belong to the Juan Tong family. SC
also ruled that the direct and positive act of Juan Tong created an implied resulting
trust.
(2) No, petitioners action is not barred by prescription, estoppel and laches. Implied
resulting trust do not prescribe except when trustee repudiates trust. Further, the
action to reconvey does not prescribe as long as property stands in the name of the
trustee. Considering that the implied trust has been repudiated through the death of
Luis, Sr., Lot 998 cannot be included in his estate except only insofar as his
undivided share is concerned. Therefore, petitioners are not estopped from claiming
ownership thereof.