SUPREME COURT

Manila
SECOND DIVISION
G.R. No. L-29838 March 18, 1983
FERMIN BOBIS and EMILIA GUADALUPE, plaintiffs-appellants
vs.
THE PROVINCIAL SHERIFF OF CAMARINES NORTE and ZOSIMO RIVERA, defendantsappellees.
Tomas Trinidad for plaintiffs-appellants.
James Pajares for defendants-appellees.

CONCEPCION, JR., J.:

Appeal from the judgment of the Court of First Instance of Camarines Norte, dismissing the
complaint for the annulment of an execution sale, which was certified to this Court by the Court of
Appeals upon the ground that only questions of law are involved in the appeal.
The facts are not disputed. It appears that Rufina Camino and Pastor Eco were the registered
owners of a parcel of land, with an area of 10.7791 hectares, covered by Transfer Certificate of Title
No. T-398. The said parcel of land was cultivated by the spouses Fermin Bobis and Emilia
Guadalupe. On July 25, 1950, one Alfonso Ortega filed a complaint against Rufina Camino, Pastor
Eco, Emilia Guadalupe, and Fermin Bobis with the Court of First Instance of Camarines Norte,
docketed therein as Civil Case No. 273, for the recovery of possession of one-half (1/2) of the
cleared and planted portion of the land, or the payment of the amount of P1,650.00, the value of the
improvements introduced by him on the parcel of land in question. On August 16, 1950, the parties
executed a compromise agreement whereby they agreed:
1. The defendants Rufina Camino and Pastor Eco shall pay the plaintiff the sum of
One Hundred Forty Pesos (P 140.00) Philippine Currency, as full payment for all the
improvements (coconuts and bananas) introduced by the plaintiff in the land in
question, payable on February 28, 1951;
2. That plaintiff has no other claim against the defendants except for the
improvements;
3. That hereafter, the plaintiff shall recognize and respect the absolute and exclusive
ownership of the land in question; and

4. That plaintiff in consideration of this amicable settlement renounces his claim for
damages.
On August 26, 1950, Rufina Camino and Pastor Eco sold the parcel of land to their co-defendants,
spouses Fermin Bobis and Emilia Guadalupe, and TCT No. T-838 was issued in their names. On
January 19, 1951, the parties submitted the compromise agreement to the court; and on January 22,
1951, the court promulgated a decision, approving the said compromise agreement.
The defendants Rufina Camino and Pastor Eco, however, only paid the amount of P50.00 to Alfonso
Ortega when the obligation became due on February 28, 1951. As a result, a writ of execution was
issued on July 18, 1951, commanding the Provincial Sheriff of Camarines Norte that the goods and
chattels of the defendants Rufina Camino, Pastor Eco, Emilia Guadalupe, and Fermin Bobis be
caused to be made the sum of P140.00. Consequently, the Sheriff levied upon the land which Rufina
Camino and Pastor Eco had sold to Fermin Bobis and Emilia Guadalupe. Upon learning of the levy
on execution, Emilia Guadalupe and Fermin Bobis filed a motion seeking the modification of the writ
of execution to exclude them therefrom because under the judgment sought to be executed only the
defendants Rufina Camino and Pastor Eco were obligated to pay the plaintiff Alfonso Ortega. But,
the trial court denied the motion. Subsequently, on September 3, 1951, the Provincial Sheriff sold the
parcel of land in question at an execution sale to Zosimo Rivera, the highest bidder.
After the expiration of one year, or on September 17, 1952, with neither Rufina Camino, Pastor Eco,
Emilia Guadalupe, nor Fermin Bobis exercising the right of redemption, the Provincial Sheriff
executed an Officer's Deed of Sale of the land in favor of the said Zosimo Rivera. The Officer's Deed
of Sale was submitted to, and approved by, the trial court on March 23, 1953.
Thereupon, Zosimo Rivera asked for a writ of possession. The Provincial Fiscal of Camarines Norte,
in his capacity as ex oficio Register of Deeds of the province, also filed a motion praying that Emilia
Guadalupe be directed to surrender the owner's duplicate of TCT No. T-838 so that the Sheriff's sale
could be annotated therein. The court granted both motions and directed the issuance of a writ of
possession, and ordered Emilia Guadalupe to surrender the owner's duplicate copy of TCT No. T838 within five (5) days from notice. Emilia Guadalupe, however, did not surrender her duplicate
copy of the certificate of title and, instead, filed a motion for the reconsideration of the order. The
motion for reconsideration was denied by the court, but still, Emilia Guadalupe refused to surrender
the owner's duplicate copy of the certificate of title. Nor did she vacate the land despite the writ of
possession. As a result, a petition to declare her in contempt of court was filed. After due hearing,
Emilia Guadalupe was declared guilty of contempt for disobeying a lawful order and for obstructing
the administration of justice and sentenced to undergo imprisonment until such time as she complies
with the orders of the court.
On March 4,1960, Fermin Bobis and Emilia Guadalupe filed the instant action against the Provincial
Sheriff of Camarines Norte and Zosimo Rivera with the Court of First Instance of Camarines Norte,
docketed therein as Civil Case No. 1169, for the annulment of the sheriff's deed of sale and for
damages, upon the ground that the writ of execution issued in Civil Case No. 273 was not in
conformity with the judgment rendered therein and therefore, void and of no legal effect. Upon the
filing of the complaint, the court ordered the release of Emilia Guadalupe who had been confined in
jail for about 8 months.

On June 3, 1964, the trial court rendered a decision, the dispositive portion of which reads, as
follows:
IN VIEW OF THE FOREGOING judgment is hereby rendered (a) dismissing the
complaint with costs against the plaintiffs; (b) declaring the sale executed by Camino
and Eco in favor of Emilia Guadalupe rescinded; (c) declaring the sale executed by
defendant Provincial Sheriff in favor of Zosimo Rivera valid and legal; (d) declaring
said defendant Zosimo Rivera the owner of the land described in the complaint; and
(e) ordering Emilia Guadalupe to execute a deed of conveyance in favor of defendant
Zosimo Rivera. 1
The plaintiffs appealed to the Court of Appeals, but the latter court elevated the case to this Court for
final determination for the reason that only questions of law are involved in the appeal.
The appellants contend that the trial court erred:
1. In declaring that the sale executed by the provincial Sheriff in favor of Zosimo
Rivera valid and legal and that Zosimo Rivera is now the owner of the land in
question;
2. In dismissing the complaint for annulment of the sale made by the Provincial
Sheriff which is void from the beginning;
3. In declaring the sale executed by Camino and Eco in favor of Emilia Guadalupe
rescinded when there is no action for the same;
4. In ordering Emilia Guadalupe to execute a deed of conveyance in favor of
defendant Zosimo Rivera when the property is of the conjugal partnership of Fermin
Bobis and Emilia Guadalupe; and
5. In not granting damages against Zosimo Rivera and the Provincial Sheriff when
the machination to deprive plaintiffs of their land is very evident in their actuations not
only because of the ridiculously niggardly price but also because the true plaintiff
(Ortega) was not benefited by the sale.
We find the appeal impressed with merit. The writ of execution issued in Civil Case No. 273 is null
and void with respect to the spouses Fermin Bobis and Emilia Guadalupe; hence, the sale of their
property at a subsequent sale at public auction to the defendant Zosimo Rivera is, likewise, void and
of no legal effect. The judgment rendered in Civil Case No. 273 decreed:
l. That defendants Rufina Camino and Pastor Eco shall pay the plaintiff the sum of
One Hundred Forty Pesos (P 140.00) Philippine Currency, as full payment for all the
improvements (coconut bananas) introduced by the plaintiff in the land in question,
payable on February 28, 1951;

2. That plaintiff has no other claim against the defendants except for the
improvements;
3. That hereafter, the plaintiff shall recognize and respect the absolute and exclusive
ownership of the land in question; and
4. That plaintiff in consideration of this amicable settlement renounces his claim for
damages.
As will be seen, only Rufina Camino and Pastor Eco were adjudged to pay Alfonso Ortega the
amount of P140.00 on February 28, 1951. Although they were included as party defendants, the
spouses Fermin Bobis and Emilia Guadalupe were not ordered to pay Alfonso Ortega. Obviously,
they were absolved from liability. Accordingly, as to them, there was nothing to execute since they
have been absolved from liability. When, therefore, the lower court, in issuing the writ of execution of
the judgment, commanded the Provincial Sheriff that the goods and chattels of the defendants
Rufina Camino and Pastor Eco, Emilia Guadalupe and Fermin Bobis be caused to be made the sum
of P140.00 whereby making the spouses Fermin Bobis and Emilia Guadalupe equally liable for the
judgment debt of the spouses Rufina Camino and Pastor Eco, adding to the judgment sought to be
executed a new relief, it acted in excess of jurisdiction, if not abuse of authority. As the late Chief
Justice Moran says in his Comments on the Rules of Court, "The writ of execution must conform to
the judgment which is to be executed, as it may not vary the terms of the judgment it seeks to
enforce. Nor may it go beyond the terms of the judgment sought to be executed. Where the
execution is not in harmony with the judgment which gives it life and exceeds it, it has pro tanto no
validity. To maintain otherwise would be to ignore the constitutional provision against depriving a
person of his property without due process of law." 2
Besides, the judgment rendered in Civil Case No. 273 was based upon a compromise agreement of
the parties. In the case of Yboleon vs. Sison, 3 this Court ruled that "a judge or court, which sets aside a
judgment rendered upon consent of the parties and based on a compromise entered into by them, which
is converted into such judgment, cannot amend or set it aside without the consent of said parties, or
without first having declared in an incidental preliminary hearing that such compromise is vitiated by any
of the grounds for nullity enumerated in Article 1817 (now Art. 2038) of the Civil Code." Since the
modification and amendment of the judgment was made unilaterally in the writ of execution, without any
preliminary hearing, it was unjustified.
It results that the writ of execution is null and void and of no legal effect with respect to the spouses
Fermin Bobis and Emilia Guadalupe. The annulment of the writ of execution carries with it the
annulment of the sale made by the sheriff pursuant to the said writ, as well as the order of the court
approving the sale. The limbs cannot survive after the trunk has perished. 4
Since the right of Zosimo Rivera over the land in question is derived from a void execution sale, he
acquired no title therein.
Besides, Section 35, Rule 39 of the Rules of Court provides that a purchaser of real property at an
execution sale "shall be substituted to and acquire all the right, title, interest, and claim of the
judgment debtor to the property as of the time of the levy." It follows that if at that time the judgment
debtor had no more right to, or interest in, the property because he had already sold it to another,

then the purchaser acquires nothing. Such appears to be the case here for it is not disputed that
before the execution sale, and even before the levy on execution, or the rendition of the judgment in
Civil Case No. 273, the judgment debtors Rufina Camino and Pastor Eco had already deeded the
property to Fermin Bobis and Emilia Guadalupe and a new certificate of title was issued in the
names of the vendees.
In dismissing the complaint filed in the instant case, the trial court found that the sale of the land to
Fermin Bobis and Emilia Guadalupe was tainted with fraud since the said sale was made during the
pendency of Civil Case No. 273, and that the price was inadequate.
The rule, however, is that fraud is not presumed. As fraud is criminal in nature, it must be proved by
clear preponderance of evidence. 5 In order that a contract may be rescinded as in fraud of creditors, it is
essential that it be shown that both contracting parties have acted maliciously and with fraud and for the
purpose of prejudicing said creditors, and that the latter are deprived by the transaction of all means by
which they may effect collection of their claims. All these circumstances must concur in a given case. The
presence of only one of them is not enough. 6 In this particular case, there is no evidence that the
spouses Rufina Camino and Pastor Eco connived with the spouses Fermin Bobis and Emilia Guadalupe
to defraud Alfonso Ortega. Nor is there evidence to show that the sale of the land to Fermin Bobis and
Emilia Guadalupe tended to deprive Alfonso Ortega of means to collect his claim from the spouses Rufina
Camino and Pastor Eco As a matter of fact, no oral or documentary evidence was presented by the
parties, and the trial court merely assumed that the sale to Fermin Bobis and Emilia Guadalupe was
fraudulent because of the inadequacy of the price, and that the sale was executed during the pendency of
Civil Case No. 273. While these circumstances may be considered badges of fraud, 7the sale cannot be
considered in fraud of creditors in the absence of proof that the vendors Rufina Camino and Pastor Eco
had no other property except that parcel of land they sold to the spouses Fermin Bobis and Emilia
Guadalupe. Besides, Alfonso Ortega knew of such sale and did nothing to have it annulled as in fraud of
creditors. Now did he cause a cautionary notice to be inscribed in the certificate of title to protect his
interests. Moreover, the sale was not fictitious, designed to escape payment of the obligation to Alfonso
Ortega. The tenacity by which Emilia Guadalupe had clung to her property to the extent of undergoing
imprisonment is indicative of their good faith.
In his answer, the defendant Zosimo Rivera claimed that the appellant's cause of action is barred by
a prior judgment. Apparently, the said defendant was referring to the denial of the appellant's motion
to modify the writ of execution filed in Civil Case No. 273. However, the denial of the appellant's
motion to modify the writ of execution, which for all purposes was a third party claim, does not
constitute a bar to another action even if no appeal was taken from the disapproval of the third party
claim. 8 A third-party claimant may file a separate reinvindicatory action against the execution creditor or
the purchaser of the property at the sale at public auction. He may also file a complaint for damages to be
charged against the bond filed by the judgment creditor in favor of the sheriff. Such reinvindicatory action
is reserved to the third-party claimant by Section 17, Rule 39 of the Rules of Court despite the disapproval
of its claim by the court itself. 9 Appeal is not proper in the case, 10 nor a writ of certiorari or prohibition. 11
With respect to the claim of the appellants for damages, it is the rule that when the property of one
person is taken by the sheriff upon an execution against another person, the sheriff is liable as any
private person would be for wrongly taking property of another. But, such does not obtain in the
present case. The sheriff did not wrongfully take the property of the appellant spouses Fermin Bobis
and Emilia Guadalupe to satisfy the judgment debt of another. The writ of execution specifically

ordered him to cause the goods and chattels of Emilia Guadalupe, Fermin Bobis, Rufina Camino,
and Pastor Eco to be made the sum of P140.00, and the sheriff merely followed the order. The
defect was in the writ of execution issued by the lower court and not in the levy or in the sale at
public auction. Hence, no fault can be attributed to the sheriff. Therefore, he cannot be made liable
for the damages incurred by the appellant spouses. Corollarily, no damages can also be recovered
from the buyer of the property at the sale at public auction.
WHEREFORE, the judgment appealed from should be, as it is hereby, SET ASIDE and another one
entered, declaring the writ of execution, dated July 18, 1951, issued in Civil Case No. 273 of the
Court of First Instance of Camarines Norte, entitled, "Alfonso Ortega, plaintiff, versus Rufina Camino,
et al., defendants," the sale made by the sheriff pursuant to said writ, as well as the order of the
court approving said sale, null and void and of no legal effect with respect to the spouses Fermin
Bobis and Emilia Guadalupe. Without pronouncement as to costs.
SO ORDERED.
Makasiar (Chairman), Guerrero, Abad Santos, De Castro and Escolin, JJ., concur.
Aquino, J., is on leave.
EN BANC
[G.R. No. 7003. January 18, 1912. ]
MANUEL ORIA Y GONZALEZ, Plaintiff-Appellant, v. JOSE MCMICKING, as sheriff of the city of
Manila, GUTIERREZ HERMANOS, MIGUEL GUTIERREZ DE CELIS, DANIEL PEREZ, and LEOPOLDO
CRIADO, Defendants-Appellees.
Chicote & Miranda, for Appellant.
Eduardo Gutierrez Repide for Appellees.
SYLLABUS
1. ACTION TO SET ASIDE SALE IN FRAUD OF CREDITORS; PROOF THAT THE VENDOR HAS No PROPERTY TO
PAY SUING CREDITOR. While, in an action to set aside a conveyance, on the ground that it is made in
fraud of creditors, it is not necessary to prove the issuance and return of an execution nulla bona,
nevertheless, it is necessary to show clearly that the alleged fraudulent vendor has no property with which
to pay the suing creditor.
2. ID.; SALE DECLARED FRAUDULENT ONLY SO FAR AS NECESSARY. Where a sale is declared fraudulent,
at the suit of a particular creditor, courts will declare such sale fraudulent only so far as necessary to pay the
suing creditor; it will not be disturbed any further than that.
3. ID.; TEST TO DETERMINE WHETHER SALE IS FRAUDULENT. In an action to determine whether or not a
given sale is fraudulent, the test to determine its real character is: Did it materially prejudice the rights of
the suing creditor?
4. ID.; CIRCUMSTANCES INDICATING FRAUD. In determining whether or not a sale is fraudulent, the
following circumstances, attending such sale, are indications of fraud:
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1. The fact that the consideration of the conveyance is fictitious or is inadequate.

2. A transfer made by a debtor after suit has been begun and while it is pending against him.

3. A sale upon credit by an insolvent debtor.

4. Evidence of large indebtedness or complete insolvency.
5. The transfer of all or nearly all of his property by a debtor, especially when he is insolvent or greatly
embarrassed financially.
6. The fact that the transfer is made between father and son, when there are present other of the above
circumstances.
7. The failure of the vendee to take exclusive possession of all of the property.
5. ID.; PROCEDURE BY CREDITOR; ACTION BY ALLEGED OWNER. Whether or not a sale is fraudulent as
to a suing creditor, can be tested and determined without first resorting to a direct action to annul the sale.
A creditor may attack the sale by ignoring it and seizing under his execution. the property or any necessary
part thereof which is the subject matter of the sale. The character of the sale will then be determined in the
action brought by the alleged owner against the execution creditor.
6. ID.; SALE DECLARED FRAUDULENT AS TO SUING CREDITOR. The facts in the case at bar examined
and held sufficient to sustain a judgment declaring the sale fraudulent as to the suing creditor.

DECISION

MORELAND, J. :

These are the facts:

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In the month of August, 1909, Gutierrez Hermanos brought an action against Oria Hermanos & Co. for the
recovery of P147,204.28; that action is known as No. 7289 in the Court of First Instance of Manila. In
March, 1910, the same plaintiff began another action against the same defendant for the recovery of
P12,318.57; this case was known as No. 7719 in said court. Subsequent to the beginning of the above
actions, and on or about the 30th day of April, 1910, the members of the company of Oria Hermanos & Co.,
on account of the expiration of the time stated in their agreement of copartnership, dissolved their relations
and entered into liquidation. On the 1st day of June, 1910, Tomas Oria y Balbas, as managing partner in
liquidation, acting for himself and on behalf of his other coowners Casimiro Oria y Balbas and Adolfo Fuster
Robles, entered into a contract with the plaintiff in this case, Manuel Oria Gonzalez, which said contract was
for the purpose of selling and transferring to the plaintiff in this action all of the property of which the said
Oria Hermanos & Co. was owner. Said instrument contained the following clauses:
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"5. I, Tomas Oria y Balbas, do further state and declare that I have agreed with the other party hereto, Don
Manuel Oria y Gonzalez, to sell all the property I have mentioned, which is specified more in detail in the
general inventory of Oria Hermanos & Co., for the price and under the conditions hereinafter expressed; and
in order to carry into effect such agreement made by me with the said Don Manuel Oria y Gonzalez, in my
own right and also in representation of my partners, Don Casimiro Oria and Don Adolfo Fuster, I do hereby
stipulate and agree:
jgc:chanroble s.com.ph

"6. As managing partner and liquidator of Oria Hermanos & Co., and further in my own right and in the
name and representation of Don Casimiro Oria y Balbas and Don Adolfo Fuster y Robles, personally and as
partners in Oria Hermanos & Co., in consideration of the sum of two hundred seventy-four thousand pesos
(P274,000), which the said Don Manuel Oria y Gonzalez undertakes and engages to pay to the firm of Oria
Hermanos & Co. in liquidation, or to us the parties hereto, myself and the persons I represent, as partners in
Oria Hermanos & Co., which sum shall be paid in installments, in the manner and under the conditions
hereinafter set forth. I hereby sell, cede and transfer absolutely and forever to the said Don Manuel Oria y
Gonzalez, his heirs and assigns, all and every part of the property mentioned in the fourth section hereof
and more specifically described in the general inventory of Oria Hermanos & Co.; under the following mutual
conditions:
jgc:chanrobles.com .ph

"(a) Don Manuel Oria y Gonzalez engages and undertakes to pay and to settle the sum agreed upon for this
sale, cession and transfer within a period of twelve (12) years, further engaging and undertaking to pay
each year a sum of not less than ten thousand (10,000) pesos and at the end of said period to settle the
balance of said price.
"(b) After the first six (6) years of the period for the payment of the stipulated price, that is, during the last
six years of said period, Don Manuel Oria y Gonzalez engages and undertakes to pay interest at 3 per cent a
year on the price stipulated or the part thereof unpaid at such time; provided, that this is a mutual
obligation and the interest payable annually.
"(c) Don Manuel Oria y Gonzalez further engages and undertakes to pay to Don Tomas Oria, Don Casimiro
Oria and Don Adolfo Fuster during the time that they remain in the Philippines and do not reside abroad, the
sum of one hundred and fifty (150) pesos monthly; which obligation shall be understood to be contracted
individually with each of the said parties; and the amounts so paid to each and all of them shall be charged
to the account of Oria Hermanos & Co., in liquidation, in discharge of the stipulated consideration and the
installments thereof and interest thereon when due.
"(d) Don Manuel Oria y Gonzalez engages and undertakes not to sell, alienate, transfer or mortgage, either
wholly or in part, the property hereby sold to him, without the written authorization of Don Tomas Oria as
liquidator of the firm of Oria Hermanos & Co., so long as the consideration of this sale is not fully satisfied,
to guarantee which this restriction is imposed: provided, that this restriction applies only to the vessels, real
estate and branch stores in the towns mentioned in the fourth section of this instrument, not to the rest of
the property.
"(e) Don Manuel Oria y Gonzalez engages and undertakes to cede gratuitously in the dwelling-house in the
town of Laoang, hereby sold, the use of the same or the portion thereof that may be necessary for Don
Tomas Oria to establish therein the liquidation office of Oria Hermanos & Co.; provided, that this cession is
made for a period of only two (2) years.
"(f) Don Tomas Oria y Balbas and Don Adolfo Fuster engage and undertake to place their personal services
at the disposal of Don Manuel Oria y Gonzalez in everything relating to his instruction in the management
and conduct of the property and business hereby sold; provided, that this obligation and promise shall be
binding upon Don Adolfo Fuster only for the time he may reside in the Philippines and upon both parties only
for a maximum period of 12 months.
"7. I, Manuel Oria y Gonzalez, being informed of the foregoing action and contract executed by Don Tomas
Oria y Balbas, do on my part stipulate and agree: that I accept the sale, cession and transfer hereby made
by him in my favor and engage and undertake to pay to Oria Hermanos & Co., either in liquidation, or if
necessary to the partners of Oria Hermanos & Co., the price of said sale, cession and transfer, that is, the
sum of P274,000, within a period of 12 years, in the manner and under the conditions set forth by him in
the preceding section, and especially engage not to sell, alienate, transfer or mortgage the property involved
in this sale which is specified in paragraph (d) of the preceding section, without the previous written
authorization of the vendor, Oria Hermanos & Co., such property being so exempted as a guaranty for the
payment of the purchase price of this sale."
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Among the goods transferred by this instrument was the steamship Serantes, which is the subject of this
litigation.
On the 17th day of September, 1910, case No. 7719, above referred to, was resolved by the Court of First
Instance in favor of Gutierrez Hermanos and against Oria Hermanos & Co. for the sum demanded in the
complaint. The cause was appealed to the Supreme Court and, the judgment therein having been affirmed,
1 execution was issued thereon and placed in the hands of the sheriff of Manila. The sheriff immediately
demanded that Tomas Oria y Balbas, as liquidator of the firm of Oria Hermanos & Co. make payment of the
said judgment, to which he replied that there were no funds with which to pay the same. Thereupon the
sheriff levied upon the said steamer Serantes, took possession of the same, and announced it for sale at
public auction on the 21st day of October, 1910. On the 18th day of October, 1910, three days before the
sale, the plaintiff in this action presented to the sheriff a written statement claiming to be the owner of the
said steamship, and to have the right of possession of the same by reason of the sale to him by Oria
Hermanos & Co. of all of the property belonging to said company, including the said steamer Serantes, as
shown by the instrument above referred to and quoted. The sheriff thereupon required Gutierrez Hermanos
to present a bond for his protection, which having been done, the sheriff proceeded to the sale of the said
steamship. At the sale Gutierrez Hermanos became the purchaser, said company being the highest bidder,

and the sum which it paid being the highest sum bidden for the same.
On the 19th day of October, 1911, the plaintiff began the present action, which has for its object, as shown
by the prayer of the complaint: First, the issuance of a preliminary injunction to prevent the sale of said
steamship; and, second, the declaration that the plaintiff is the owner of said steamship and is entitled to
the possession of the same, and that the defendant be required to restore the same to the plaintiff and to
pay P10,000 damages for its detention.
Upon the trial judgment was found in favor of the defendant and against the plaintiff, and the complaint was
dismissed upon the merits with costs. From that judgment this appeal is taken.
The substantial question presented for our consideration is the validity of the sale from Oria Hermanos & Co.
to Manuel Oria y Gonzalez as against the creditors of said company. It is the contention of Gutierrez
Hermanos that said sale is fraudulent as against the creditors of Oria Hermanos & Co., and that the transfer
thereby consummated of the steamship in question was void as to said creditors and as to Gutierrez
Hermanos in particular.
There is some contention on the part of the plaintiffs that aside from the property included in the sale
referred to, Oria Hermanos & Co. had sufficient other property to pay the judgment of Gutierrez Hermanos.
The trial court found, however, against the plaintiff in this regard. A careful examination of the record fails to
disclose any sufficient reason for the reversal of this finding. While the evidence is somewhat conflicting, we
are of the opinion that there is sufficient to sustain the findings made.
In determining whether or not the sale in question was fraudulent as against creditors, these facts must be
kept in mind:
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1. At the time of said sale the value of the assets of Oria Hermanos & Co., as stated by the partners
themselves, was P274,000.
2. That at the time of said sale actions were pending against said company by one single creditor for sums
aggregating in amount nearly P160,000.
3. The vendee of said sale was a son of Tomas Oria y Balbas and a nephew of the other two persons
heretofore mentioned which said three brothers together constituted all of the members of said company.
4. Nothing of value seems to have been delivered by the plaintiff in consideration of said sale and no
security whatever was given for the payments therein provided for.
5. The plaintiff is a young man twenty-five years of age. There is no pretense whatever that he owned any
property or had any business at the time of the sale. On the contrary it appears without contradiction that,
when the sale took place, he was merely a student without assets and without gainful occupation.
6. Plaintiff, at the time of the sale, was fully aware of the two suits that had already been begun against the
company whose assets he was purchasing and well knew that if said suits should terminate in favor of the
plaintiffs therein the judgments in which they terminated would have to be paid out of the property which he
was then taking over or they would not be paid at all.
7. Under all the circumstances the sale in question was, so far as the creditors were concerned, without
consideration. To turn over a business worth P274,000 to an "impecunious and vocationless youth" who
knew absolutely nothing about the business he received, and whose adaptability to the management of that
business was entirely unknown, without a penny being paid down, without any security whatever, is a
proceeding so unusual, so devoid of care and caution, and so wholly outside of the well-defined lines of
ordinary business transactions, as to startle any person interested in the concern.
8. It is certain that the members of the company of Oria Hermanos & Co. would never have made a similar
contract or executed a similar instrument with a stranger.
9. The prohibition in the contract against the sale of certain portions of the property by the plaintiff offers no
protection whatever to the creditors. Such prohibition is not security. The parties who made the original
transfer can waive and release it at pleasure. Such restriction is of no value to the creditors of the company.
They can not utilize it for the reduction of their claims or in any other beneficial way.

In determining whether or not a certain conveyance is fraudulent the question in every case is whether the
conveyance was a bona fide transaction or a trick and contrivance to defeat creditors, or whether it
conserves to the debtor a special right. It is not sufficient that it is founded on good consideration or is made
with bona fide intent: it must have both elements. If defective in either of these particulars, although good
between the parties, it is voidable as to creditors. The rule is universal both at law and in equity that
whatever fraud creates justice will destroy. The test as to whether or not a conveyance is fraudulent s, does
it prejudice the rights of creditors?
In the consideration of whether or not certain transfers were fraudulent, courts have laid down certain rules
by which the fraudulent character of the transaction may be determined. The following are some of the
circumstances attending sales which have been denominated by the courts badges of fraud:
chanrob1es virtual 1aw library

1. The fact that the consideration of the conveyance is fictitious or is inadequate.

2. A transfer made by a debtor after suit has been begun and while it is pending against him.
3. A sale upon credit by an insolvent debtor.
4. Evidence of large indebtedness or complete insolvency.
5. The transfer of all or nearly all of his property by a debtor, especially when he is insolvent or greatly
embarrassed financially.
6. The fact that the transfer is made between father and son; when there are present other of the above
circumstances.
7. The failure of the vendee to take exclusive possession of all the property.
The case at bar presents every one of the badges of fraud above enumerated. Tested by the inquiry, does
the sale prejudice the rights of creditors, the result is clear. The sale in the form in which it was made leaves
the creditors substantially without recourse. The property of the company is gone, its income is gone, the
business itself is likely to fail, the property is being dissipated, and is depreciating in value. As a result, even
if the claims of the creditors should live twelve years and the creditors themselves wait that long, it is more
than likely that nothing would be found to satisfy their claims at the end of the long wait. (Regalado v.
Luchsinger & Co., 5 Phil. Rep., 625; art. 1297, Civil Code, par. 1; Manresas Commentaries, vol. 8, pp. 713719.)
Since the record shows that there was no property with which the judgment in question could be paid, the
defendants were obliged to resort to and levy upon the steamer in suit. The court below was correct in
finding the sale fraudulent and void as to Gutierrez Hermanos in so far as was necessary to permit the
collection of its judgment. As a corollary, the court below found that the evidence failed to show that the
plaintiff was the owner or entitled to the possession of the steamer in question at the time of the levy and
sale complained of, or that he was damaged thereby. Defendant had the right to make the levy and test the
validity of the sale in that way, without first resorting to a direct action to annul the sale. The creditor may
attack the sale by ignoring it and seizing under his execution the property, or any necessary portion thereof,
which is the subject of the sale.
For these reasons the judgment is affirmed, without special finding as to costs. So ordered.
Arellano, C.J., Torres, Mapa, Johnson, Carson, and Trent, JJ., concur.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-11872

December 1, 1917

DOMINGO MERCADO and JOSEFA MERCADO, plaintiffs-appellants,

vs.
JOSE ESPIRITU, administrator of the estate of the deceased Luis Espiritu, defendant-appellee.
Perfecto Salas Rodriguez for appellants.
Vicente Foz for appellee.

TORRES, J.:
This is an appeal by bill of exceptions, filed by the counsel for the plaintiffs from the judgment of
September 22, 1914, in which the judge of the Seventh Judicial District dismissed the complaint filed
by the plaintiffs and ordered them to keep perpetual silence in regard to the litigated land, and to pay
the costs of the suit.
By a complaint dated April 9, 1913, counsel for Domingo and Josefa Mercado brought suit in the
Court of First Instance of Bulacan, against Luis Espiritu, but, as the latter died soon thereafter, the
complaint was amended by being directed against Jose Espiritu in his capacity of his administrator
of the estate of the deceased Luis Espiritu. The plaintiffs alleged that they and their sisters
Concepcion and Paz, all surnamed Mercado, were the children and sole heirs of Margarita Espiritu,
a sister of the deceased Luis Espiritu; that Margarita Espiritu died in 1897, leaving as her
paraphernal property a tract of land of 48 hectares in area situated in the barrio of Panducot,
municipality of Calumpit, Bulacan, and bounded as described in paragraph 4 of the amended
complaint, which hereditary portion had since then been held by the plaintiffs and their sisters,
through their father Wenceslao Mercado, husband of Margarita Espiritu; that, about the year 1910,
said Luis Espiritu, by means of cajolery, induced, and fraudulently succeeded in getting the plaintiffs
Domingo and Josefa Mercado to sign a deed of sale of the land left by their mother, for the sum of
P400, which amount was divided among the two plaintiffs and their sisters Concepcion and Paz,
notwithstanding the fact that said land, according to its assessment, was valued at P3,795; that onehalf of the land in question belonged to Margarita Espiritu, and one-half of this share, that is, onefourth of said land , to the plaintiffs, and the other one-fourth, to their two sisters Concepcion and
Paz; that the part of the land belonging to the two plaintiffs could produce 180 cavanes of rice per
annum, at P2.50 per cavan, was equivalent to P450 per annum; and that Luis Espiritu had received
said products from 1901 until the time of his death. Said counsel therefore asked that judgment be
rendered in plaintiffs' favor by holding to be null and void the sale they made of their respective
shares of their land, to Luis Espiritu, and that the defendant be ordered to deliver and restore to the
plaintiffs the shares of the land that fell to the latter in the partition of the estate of their deceased
mother Margarita Espiritu, together with the products thereof, uncollected since 1901, or their
equivalent, to wit, P450 per annum, and to pay the costs of the suit.
In due season the defendant administrator answered the aforementioned complaint, denying each
and all of the allegations therein contained, and in special defense alleged that the land, the subjectmatter of the complaint, had an area of only 21 cavanes of seed rice; that, on May 25, 1894, its
owner, the deceased Margarita Espiritu y Yutoc, the plaintiffs' mother, with the due authorization of
her husband Wenceslao Mercado y Arnedo Cruz sold to Luis Espiritu for the sum of P2,000 a portion

of said land, to wit, an area such as is usually required for fifteen cavanes of seed; that
subsequently, on May 14, 1901, Wenceslao Mercado y Arnedo Cruz, the plaintiffs' father, in his
capacity as administrator of the property of his children sold under pacto de retro to the same Luis
Espiritu at the price of P375 the remainder of the said land, to wit, an area covered by six cavanes of
seed to meet the expenses of the maintenance of his (Wenceslao's) children, and this amount being
still insufficient the successively borrowed from said Luis Espiritu other sums of money aggregating a
total of P600; but that later, on May 17,1910, the plaintiffs, alleging themselves to be of legal age,
executed, with their sisters Maria del Consejo and Maria dela Paz, the notarial instrument inserted
integrally in the 5th paragraph of the answer, by which instrument, ratifying said sale under pacto de
retro of the land that had belonged to their mother Margarita Espiritu, effected by their father
Wenceslao Mercado in favor of Luis Espiritu for the sum of P2,600, they sold absolutely and
perpetually to said Luis Espiritu, in consideration of P400, the property that had belonged to their
deceased mother and which they acknowledged having received from the aforementioned
purchaser. In this cross-complaint the defendant alleged that the complaint filed by the plaintiffs was
unfounded and malicious, and that thereby losses and damages in the sum of P1,000 had been
caused to the intestate estate of the said Luis Espiritu. He therefore asked that judgment be
rendered by ordering the plaintiffs to keep perpetual silence with respect to the land in litigation and,
besides, to pay said intestate estate P1,000 for losses and damages, and that the costs of the trial
be charged against them.
In reply to the cross-complaint, the plaintiffs denied each and all of the facts therein set forth, and in
special defense alleged that at the time of the execution of the deed of sale inserted in the crosscomplaint the plaintiffs were still minors, and that since they reached their majority the four years
fixed by law for the annulment of said contract had not yet elapsed. They therefore asked that they
be absolved from the defendant's cross-complaint.
After trial and the introduction of evidence by both parties, the court rendered the judgment
aforementioned, to which the plaintiffs excepted and in writing moved for a reopening of the case
and a new trial. This motion was overruled, exception was taken by the petitioners, and the proper
bill of exceptions having been presented, the same was approved and transmitted to the clerk of this
court.
As the plaintiffs assailed the validity of the deed of sale, Exhibit 3, executed by them on May 17,
1910, on the ground that they were minors when they executed it, the questions submitted to the
decision of this court consist in determining whether it is true that the plaintiffs were then minors and
therefore incapable of selling their property on the date borne by the instrument Exhibit 3; and in
case they then were such, whether a person who is really and truly a minor and, notwithstanding,
attests that he is of legal age, can, after the execution of the deed and within legal period, ask for the
annulment of the instrument executed by him, because of some defect that invalidates the contract,
in accordance with the law (Civ. Code, arts. 1263 and 1300), so that he may obtain the restitution of
the land sold.
The records shows it to have been fully proven that in 1891 Lucas Espiritu obtained title by
composition with the State, to three parcels of land, adjoining each other, in the sitio of Panducot of
the pueblo of Calumpit, Bulacan, containing altogether an area of 75 hectares, 25 ares, and 59
centares, which facts appear in the title Exhibit D; that, upon Luis Espiritu's death, his said lands

passed by inheritance to his four children named Victoria, Ines, Margarita, and Luis; and that, in the
partition of said decedent's estate, the parcel of land described in the complaint as containing fortyseven and odd hectares was allotted to the brother and sister Luis and Margarita, in equal shares.
Margarita Espiritu, married to Wenceslao Mercado y Ardeno Cruz, had by this husband five children,
Maria Consejo, Maria de la Paz, Domingo, Josefa, and Amalia, all surnamed Mercado y Espiritu,
who, at the death of their mother in 1896 inherited, by operation of law, one-half of the land
described in the complaint.
The plaintiffs' petition for annulment of the sale and the consequent restitution to them of two-fourths
of the land left by their mother, that is, of one-fourth of all the land described in the complaint, and
which, they stated, amounts to 11 hectares, 86 ares and 37 centares. To this claim the defendant
excepted, alleging that the land in question comprised only an area such as is customarily covered
by 21 cavanes of seed.
It was also duly proven that, by a notarial instrument of May 25, 1894, the plaintiffs' mother conveyed
by actual and absolute sale for the sum of P2,000, to her brother Luis Espiritu a portion of the land
now on litigation, or an area such as is usually covered by about 15 cavanes of seed; and that, on
account of the loss of the original of said instrument, which was on the possession of the purchaser
Luis Espiritu, and furthermore because, during the revolution, the protocols or registers of public
documents of the Province of Bulacan were burned, Wenceslao Mercado y Arnedo Cruz, the
widower of the vendor and father of the plaintiffs, executed, at the instance of the interested party
Luis Espiritu, the notarial instrument Exhibit 1, of the date of May 20, 1901, in his own name and
those of his minor children Maria Consejo, Maria de la Paz, Domingo, Josefa, and Amalia, and
therein set forth that it was true that the sale of said portion of land had been made by his
aforementioned wife, then deceased, to Luis Espiritu in 1894.
However, even prior to said date, to wit, on May 14th of the same year, 1901, the widower
Wenceslao Mercado, according to the private document Exhibit 2, pledged or mortgaged to the
same man, Luis Espiritu, for P375, a part, or an area covered by six cavanes of seed, of the land
that had belonged to this vendor's deceased wife, to the said Luis Espiritu and which now forms a
part of the land in question a transaction which Mercado was obliged to make in order to obtain
funds with which "to cover his children's needs." Wenceslao Mercado, the plaintiffs' father, having
died, about the year 1904, the plaintiffs Domingo and Josefa Mercado, together with their sisters
Consejo and Paz, declaring themselves to be of legal age and in possession of the required legal
status to contract, executed and subscribed before a notary the document Exhibit 3, on May 17,
1910, in which referring to the previous sale of the land, effected by their deceased mother for the
sum of P2,600 and with her husband's permission and authorization, they sold absolutely and in
perpetuity to Luis Espiritu, for the sum of P400 "as an increase" of the previous purchase price, the
land described in said instrument and situated in Panducot, pueblo of Calumpit, Bulacan, of an area
equal to that usually sown with 21 cavanes of seed bounded on the north by the lands of Flaviano
Abreu and the heirs of Pedro Espiritu, on the east by those of Victoria Espiritu and Ines Espiritu, on
the south by those of Luis Espiritu, and on the west by those of Hermogenes Tan-Toco and by the
Sapang-Maitu stream.
In this status of the case the plaintiffs seek the annulment of the deed Exhibit 3, on the ground that
on the date of its execution they were minors without legal capacity to contract, and for the further

reason that the deceased purchaser Luis Espiritu availed himself of deceit and fraud in obtaining
their consent for the execution of said deed.
As it was proven by the testimony of the clerk of the parochial church of Apalit (plaintiffs were born in
Apalit) that the baptismal register books of that parish pertaining to the years 1890-1891, were lost
or burned, the witness Maria Consejo Mercado recognized and identified the book Exhibit A, which
she testified had been kept and taken care of by her deceased father Wenceslao Mercado, pages
396 and 397 of which bear the attestation that the plaintiff Domingo Mercado was born on August 4,
1890, and Josefa Mercado, on July 14, 1891. Furthermore, this witness corroborated the averment
of the plaintiffs' minority, by the personal registration certificate of said Domingo Mercado, of the year
1914, Exhibit C, by which it appears that in 1910 he was only 23 years old, whereby it would also be
appear that Josefa Mercado was 22 years of age in 1910, and therefore, on May 17,1910, when the
instrument of purchase and sale, Exhibit 3, was executed, the plaintiffs must have been,
respectively, 19 and 18 years of age.
The witness Maria Consejo Mercado also testified that after her father's death her brother and
sisters removed to Manila to live there, although her brother Domingo used to reside with his uncle
Luis Espiritu, who took charge of the administration of the property left by his predecessors in
interest; that it was her uncle Luis who got for her brother Domingo the other cedula, Exhibit B,
pertaining to the year 1910, where in it appears that the latter was then already 23 years of age; that
she did not know why her uncle did so; that she and her brother and sisters merely signed the deed
of May 17, 1910; and that her father Wenceslao Mercado, prior to his death had pledged the land to
her uncle Luis Espiritu.
The witness Ines Espiritu testified that after the death of the plaintiffs' father, it was Luis Espiritu who
directed the cultivation of the land in litigation. This testimony was corroborated by her sister Victoria
Espiritu, who added that her nephew, the plaintiff Domingo, had lived for some time, she did not
know just how long, under the control of Luis Espiritu.
Roque Galang, married to a sister of Luis Espiritu, stated that the land that fell to his wife and to his
sister-in-law Victoria, and which had an area of about 8 hectares less than that of the land allotted to
the aforementioned Luis and Margarita produced for his wife and his sister-in-law Victoria a net and
minimum yield of 507 cavanes in 1907, in spite of its being high land and of inferior quality, as
compared with the land in dispute, and that its yield was still larger in 1914, when the said two
sisters' share was 764 cavanes.
Patricio Tanjucto, the notary before whom the deed Exhibit 3 was ratified, was a witness for the
defendant. He testified that this deed was drawn up by him at the request of the plaintiff Josefa
Mercado; that the grantors of the instrument assured him that they were all of legal age; that said
document was signed by the plaintiffs and the other contracting parties, after it had been read to
them and had been translated into the Pampangan dialect for those of them who did not understand
Spanish. On cross-examination, witness added that ever since he was 18 years of age and began to
court, he had known the plaintiff Josefa Mercado, who was then a young maiden, although she had
not yet commenced to attend social gatherings, and that all this took place about the year 1898, for
witness said that he was then [at the time of his testimony, 1914,] 34 years of age.

Antonio Espiritu, 60 years of age, who knew Lucas Espiritu and the properties owned by the latter,
testified that Espiritu's land contained an area of 84 cavanes, and after its owner's death, was under
witness' administration during to harvest two harvest seasons; that the products yielded by a portion
of this land, to wit, an area such as is sown by about 15 cavanes of seed, had been, since 1894,
utilized by Luis Espiritu, by reason of his having acquired the land; and that, after Margarita Espiritu's
death, her husband Wenceslao Mercado took possession of another portion of the land, containing
an area of six cavanes of seed and which had been left by this deceased, and that he held same
until 1901, when he conveyed it to Luis Espiritu.
lawphi1.net

The defendant-administrator, Jose Espiritu, son of the deceased Luis Espiritu, testified that the
plaintiff Domingo Mercado used to live off and on in the house of his deceased father, about the year
1909 or 1910, and used to go back and forth between his father's house and those of his other
relatives. He denied that his father had at any time administered the property belonging to the
Mercado brother and sisters.
In rebuttal, Antonio Mercado, a cousin of Wenceslao, father of the plaintiffs, testified that he mediate
in several transactions in connection with a piece of land belonging to Margarita Espiritu. When
shown the deed of purchase and sale Exhibit 1, he stated that he was not acquainted with its
contents. This same witness also testified that he mediated in a transaction had between Wenceslao
Mercado and Luis Espiritu (he did not remember the year), in which the former sold to the latter a
parcel of land situated in Panducot. He stated that as he was a witness of the deed of sale he could
identify this instrument were it exhibited to him; but he did not do so, for no instrument whatever was
presented to him for identification. The transaction mentioned must have concerned either the
ratification of the sale of the land of 15 cavanes, in 1901, attested in Exhibit 1, or the mortgage or
pledge of the other parcel of 6 cavanes, given on May 14, 1901, by Wenceslao Mercado to Luis
Espiritu, as may be seen by the private document Exhibit 2. In rebuttal, the plaintiff Josefa Mercado
denied having gone to the house of the notary Tanjutco for the purpose of requesting him to draw up
any document whatever. She stated that she saw the document Exhibit 3 for the first time in the
house of her uncle Luis Espiritu on the day she signed it, on which occasion and while said
document was being signed said notary was not present, nor were the witnesses thereto whose
names appear therein; and that she went to her said uncle's house, because he had sent for her, as
well as her brother and sisters, sending a carromata to fetch them. Victoria Espiritu denied ever
having been in the house of her brother. Luis Espiritu in company with the plaintiffs, for the purpose
of giving her consent to the execution of any deed in behalf of her brother.
The evidence adduced at the trial does not show, even circumstantially, that the purchaser Luis
Espiritu employed fraud, deceit, violence, or intimidation, in order to effect the sale mentioned in the
document Exhibit 3, executed on May 17, 1910. In this document the vendors, the brother and the
sisters Domingo, Maria del Consejo, Paz and, Josefa surnamed Mercado y Espiritu, attested the
certainty of the previous sale which their mother, during her lifetime, had made in behalf of said
purchaser Luis Espiritu, her brother with the consent of her husband Wenceslao Mercado, father of
the vendors of the portion of land situated in the barrio of Panducot, pueblo of Calumpit, Bulacan;
and in consideration of the fact that the said vendor Luis Espiritu paid them, as an increase, the sum
of P400, by virtue of the contract made with him, they declare having sold to him absolutely and in
perpetuity said parcel of the land, waive and thenceforth any and all rights they may have, inasmuch
as said sum constitutes the just price of the property.

So that said document Exhibit 3 is virtually an acknowledgment of the contract of sale of the parcel
or portion of land that would contain 15 cavanes of seed rice made by the vendors' mother in favor of
the purchaser Luis Espiritu, their uncle, and likewise an acknowledgment of the contract of pledge or
mortgage of the remainder of said land, an area of six cavanes, made with the same purchaser, at
an increase of P400 over the price of P2,600, making an aggregate sum of P3,000, decomposed as
follows: P2,000, collected during her lifetime, by the vendors' father; and the said increase of P400,
collected by the plaintiffs.
In the aforementioned sale, according to the deed of May 25, 1894, Margarita Espiritu conveyed to
her brother Luis the parcel of 15 cavanes of seed, Exhibit 1, and after her death the plaintiffs'
widowed father mortgaged or pledged the remaining parcel or portion of 6 cavanes of seed to her
brother-in-law, Luis Espiritu, in May, 1901 (Exhibit 2). So it is that the notarial instrument Exhibit 3,
which was assailed by the plaintiffs, recognized the validity of the previous contracts, and the totality
of the land, consisting of an area containing 21 cavanes of seed rice, was sold absolutely and in
perpetuity, the vendors receiving in exchange P400 more; and there is no conclusive proof in the
record that this last document was false and simulated on account of the employment of any
violence, intimidation, fraud, or deceit, in the procuring of the consent of the vendors who executed
it.
Considering the relation that exists between the document Exhibit 3 and those of previous dates,
Exhibits 1 and 2, and taking into the account the relationship between the contracting parties, and
also the general custom that prevails in many provinces of these Islands for the vendor or debtor to
obtain an increase in the price of the sale or of the pledge, or an increase in the amount loaned,
without proof to the contrary, it would be improper and illegal to hold, in view of the facts hereinabove
set forth, that the purchaser Luis Espiritu, now deceased, had any need to forge or simulate the
document Exhibit 3 inasmuch as, since May, 1894, he has held in the capacity of owner by virtue of
a prior acquisition, the parcel of land of 15 cavanes of seed, and likewise, since May, 1901,
according to the contract of mortgage or pledge, the parcel of 6 cavanes, or the remainder of the
total area of 21 cavanes.
So that Luis Espiritu was, during his lifetime, and now, after his death, his testate or intestate estate
is in lawful possession of the parcel of land situated in Panducot that contains 21 cavanes of seed,
by virtue of the title of conveyance of ownership of the land measuring 15 cavanes, and, in
consequence of the contract of pledge or mortgage in security for the sum of P600, is likewise in
lawful possession of the remainder of the land, or an area containing 6 cavanes of seed.
The plaintiffs have absolutely no right whatever to recover said first parcel of land, as its ownership
was conveyed to the purchaser by means of a singular title of purchase and sale; and as to the other
portion of 6 cavanes of seed, they could have redeemed it before May 17, 1910, upon the payment
or the return of the sum which their deceased father Wenceslao Mercado had, during his lifetime,
received as a loan under security of the pledged property; but, after the execution of the document
Exhibit 3, the creditor Luis Espiritu definitely acquired the ownership of said parcel of 6 cavanes. It is
therefore a rash venture to attempt to recover this latter parcel by means of the contract of final and
absolute sale, set forth in the deed Exhibit 3.

Moreover, the notarial document Exhibit 1, are regards the statements made therein, is of the nature
of a public document and is evidence of the fact which gave rise to its execution and of the date of
the latter, even against a third person and his predecessors in interest such as are the plaintiffs. (Civ.
Code, art. 1218.)
The plaintiffs' father, Wenceslao Mercado, recognizing it to be perfectly true that his wife Margarita
Espiritu sold said parcel of land which she inherited from her father, of an area of about "15 cavanes
of seed," to her brother Luis Espiritu, by means of an instrument executed by her on May 25,1894
an instrument that disappeared or was burned and likewise recognizing that the protocols and
register books belonging to the Province of Bulacan were destroyed as a result of the past
revolution, at the request of his brother-in-law Luis Espiritu he had no objection to give the testimony
recorded in said notarial instrument, as it was the truth regarding what had occurred, and in so doing
he acted as the plaintiffs' legitimate father in the exercise of his parental authority, inasmuch as he
had personal knowledge of said sale, he himself being the husband who authorized said
conveyance, notwithstanding that his testimony affected his children's interest and prejudiced his
own, as the owner of any fruits that might be produced by said real property.
The signature and handwriting of the document Exhibit 2 were identified as authentic by one of the
plaintiffs, Consejo Mercado, and as the record shows no evidence whatever that this document is
false, and it does not appear to have been assailed as such, and as it was signed by the plaintiffs'
father, there is no legal ground or well-founded reason why it should be rejected. It was therefore
properly admitted as evidence of the certainty of the facts therein set forth.
The principal defect attributed by the plaintiffs to the document Exhibit 3 consists in that, on the date
of May 17, 1910, when it was executed that they signed it, they were minors, that is, they had not yet
attained the age of 21 years fixed by Act No. 1891, though no evidence appears in the record that
the plaintiffs Josefa and Domingo Mercado were in fact minors, for no certified copies were
presented of their baptismal certificates, nor did the plaintiffs adduce any supplemental evidence
whatever to prove that Domingo was actually 19 and Josefa 18 years of age when they signed the
document Exhibit 3, on May 17, 1910, inasmuch as the copybook, Exhibit A, notwithstanding the
testimony of the plaintiff Consejo Mercado, does not constitute sufficient proof of the dates of births
of the said Domingo and Josefa.
However, even in the doubt whether they certainly were of legal age on the date referred to, it cannot
be gainsaid that in the document Exhibit 3 they stated that they were of legal age at the time they
executed and signed it, and on that account the sale mentioned in said notarial deed Exhibit 3 is
perfectly valid a sale that is considered as limited solely to the parcel of land of 6 cavanes of
seed, pledged by the deceased father of the plaintiffs in security for P600 received by him as a loan
from his brother-in-law Luis Espiritu, for the reason that the parcel of 15 cavanes had been lawfully
sold by its original owner, the plaintiffs' mother.
The courts, in their interpretation of the law, have laid down the rule that the sale of real estate,
made by minors who pretend to be of legal age, when in fact they are not, is valid, and they will not
be permitted to excuse themselves from the fulfillment of the obligations contracted by them, or to
have them annulled in pursuance of the provisions of Law 6, title 19, of the 6th Partida; and the
judgment that holds such a sale to be valid and absolves the purchaser from the complaint filed

against him does not violate the laws relative to the sale of minors' property, nor the juridical rules
established in consonance therewith. (Decisions of the supreme court of Spain, of April 27, 1860,
July 11, 1868, and March 1, 1875.)
itc@alf

With respect to the true age of the plaintiffs, no proof was adduced of the fact that it was Luis Espiritu
who took out Domingo Mercado's personal registration certificate on April 13, 1910, causing the age
of 23 years to be entered therein in order to corroborate the date of the notarial instrument of May
17th of the same year; and the supposition that he did, would also allow it to be supposed, in order
to show the propriety of the claim, that the cedula Exhibit C was taken out on February 14, 1914,
where in it is recorded that Domingo Mercado was on that date 23 years of age, for both these facts
are not proved; neither was any proof adduced against the statement made by the plaintiffs Domingo
and Josefa in the notarial instrument Exhibit 3, that, on the date when they executed it, they were
already of legal age, and, besides the annotation contained in the copybook Exhibit A, no
supplemental proof of their true ages was introduced.
Aside from the foregoing, from a careful examination of the record in this case, it cannot be
concluded that the plaintiffs, who claim to have minors when they executed the notarial instrument
Exhibit 3, have suffered positive and actual losses and damages in their rights and interests as a
result of the execution of said document, inasmuch as the sale effected by the plaintiffs' mother,
Margarita Espiritu, in May, 1894, of the greater part of the land of 21 cavanes of seed, did not
occasion any damage or prejudice to the plaintiffs, inasmuch as their father stated in the document
Exhibit 2 that he was obliged to mortgage or pledge said remaining portion of the land in order to
secure the loan of the P375 furnished by Luis Espiritu and which was subsequently increased to
P600 so as to provide for certain engagements or perhaps to meet the needs of his children, the
plaintiff; and therefore, to judge from the statements made by their father himself, they received
through him, in exchange for the land of 6 cavanes of seed, which passed into the possession of the
creditor Luis Espiritu, the benefit which must have accrued to them from the sums of money received
as loans; and, finally, on the execution of the impugned document Exhibit 3, the plaintiffs received
and divided between themselves the sum of P400, which sum, added to that P2,000 received by
Margarita Espiritu, and to that of the P600 collected by Wenceslao Mercado, widower of the latter
and father of the plaintiffs, makes all together the sum of P3,000, the amount paid by the purchaser
as the price of all the land containing 21 cavanes of seed, and is the just price of the property, was
not impugned, and, consequently, should be considered as equivalent to, and compensatory for, the
true value of said land.
For the foregoing reasons, whereby the errors assigned to the judgment appealed from have been
refuted, and deeming said judgment to be in accordance with law and the evidence of record, we
should, and do hereby, affirm the same, with costs against the appellants. So ordered.
Arellano, C. J., Johnson, Street, and Malcolm, JJ., concur.

Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-12471

April 13, 1959

ROSARIO L. DE BRAGANZA, ET AL., petitioners,

vs.
FERNANDO F. DE VILLA ABRILLE, respondent.
Oscar M. Herrera for petitioners.
R. P. Sarandi and F. Valdez Anama for respondents.
BENGZON, J.:
Rosario L. de Braganza and her sons Rodolfo and Guillermo petition for review of the Court of
Appeal's decision whereby they were required solidarily to pay Fernando F. de Villa Abrille the sum
of P10,000 plus 2 % interest from October 30, 1944.
The above petitioners, it appears, received from Villa Abrille, as a loan, on October 30, 1944
P70,000 in Japanese war notes and in consideration thereof, promised in writing (Exhibit A) to pay
him P10,000 "in legal currency of the P. I. two years after the cessation of the present hostilities or as
soon as International Exchange has been established in the Philippines", plus 2 % per annum.
Because payment had not been made, Villa Abrille sued them in March 1949.
In their answer before the Manila court of first Instance, defendants claimed to have received
P40,000 only instead of P70,000 as plaintiff asserted. They also averred that Guillermo and
Rodolfo were minors when they signed the promissory note Exhibit A. After hearing the parties and
their evidence, said court rendered judgment, which the appellate court affirmed, in the terms above
described.
There can be no question about the responsibility of Mrs. Rosario L. Braganza because the minority
of her consigners note release her from liability; since it is a personal defense of the minors.
However, such defense will benefit her to the extent of the shares for which such minors may be
responsible, (Art. 1148, Civil Code). It is not denied that at the time of signing Exhibit A, Guillermo
and Rodolfo Braganza were minors-16 and 18 respectively. However, the Court of Appeals found
them liable pursuant to the following reasoning:
. . . . These two appellants did not make it appears in the promissory note that they were not
yet of legal age. If they were really to their creditor, they should have appraised him on their
incapacity, and if the former, in spite of the information relative to their age, parted with his
money, then he should be contended with the consequence of his act. But, that was not the
case. Perhaps defendants in their desire to acquire much needed money, they readily and
willingly signed the promissory note, without disclosing the legal impediment with respect to
Guillermo and Rodolfo. When minor, like in the instant case, pretended to be of legal age, in
fact they were not, they will not later on be permitted to excuse themselves from the
fulfillment of the obligation contracted by them or to have it annulled. (Mercado, et al. vs.
Espiritu, 37 Phil., 215.) [Emphasis Ours.]

We cannot agree to above conclusion. From the minors' failure to disclose their minority in the same
promissory note they signed, it does not follow as a legal proposition, that they will not be permitted
thereafter to assert it. They had no juridical duty to disclose their inability. In fact, according to
Corpuz Juris Secundum, 43 p. 206;
. . . . Some authorities consider that a false representation as to age including a contract as
part of the contract and accordingly hold that it cannot be the basis of an action in tort. Other
authorities hold that such misrepresentation may be the basis of such an action, on the
theory that such misrepresentation is not a part of, and does not grow out of, the contract, or
that the enforcement of liability for such misrepresentation as tort does not constitute an
indirect of enforcing liability on the contract. In order to hold infant liable, however, the fraud
must be actual and not constructure. It has been held that his mere silence when making a
contract as to age does not constitute a fraud which can be made the basis of an action of
decit. (Emphasis Ours.)
The fraud of which an infant may be held liable to one who contracts with him in the belief
that he is of full age must be actual not constructive, and mere failure of the infant to disclose
his age is not sufficient. (27 American Jurisprudence, p. 819.)
The Mecado case1 cited in the decision under review is different because the document signed
therein by the minor specifically stated he was of age; here Exhibit A contained no such statement.
In other words, in the Mercado case, the minor was guilty of active misrepresentation; whereas in
this case, if the minors were guilty at all, which we doubt it is of passive (or constructive)
misrepresentation. Indeed, there is a growing sentiment in favor of limiting the scope of the
application of the Mercado ruling, what with the consideration that the very minority which
incapacitated from contracting should likewise exempt them from the results of misrepresentation.
We hold, on this point, that being minors, Rodolfo and Guillermo Braganza could not be legally
bound by their signatures in Exhibit A.
It is argued, nevertheless, by respondent that inasmuch as this defense was interposed only in 1951,
and inasmuch as Rodolfo reached the age of majority in 1947, it was too late to invoke it because
more than 4 years had elapsed after he had become emancipated upon reaching the age of
majority. The provisions of Article 1301 of the Civil Code are quoted to the effect that "an action to
annul a contract by reason of majority must be filed within 4 years" after the minor has reached
majority age. The parties do not specify the exact date of Rodolfo's birth. It is undenied, however,
that in October 1944, he was 18 years old. On the basis of such datum, it should be held that in
October 1947, he was 21 years old, and in October 1951, he was 25 years old. So that when this
defense was interposed in June 1951, four years had not yet completely elapsed from October 1947.
Furthermore, there is reason to doubt the pertinency of the 4-years period fixed by Article 1301 of
the Civil Code where minority is set up only as a defense to an action, without the minors asking for
any positive relief from the contract. For one thing, they have not filed in this case an action for
annulment.2 They merely interposed an excuse from liability.
Upon the other hand, these minors may not be entirely absolved from monetary responsibility. In
accordance with the provisions of Civil Code, even if their written contact is unenforceable because
of non-age, they shall make restitution to the extent that they have profited by the money they
received. (Art. 1340) There is testimony that the funds delivered to them by Villa Abrille were used
for their support during the Japanese occupation. Such being the case, it is but fair to hold that they
had profited to the extent of the value of such money, which value has been authoritatively

established in the so-called Ballantine Schedule: in October 1944, P40.00 Japanese notes were
equivalent to P1 of current Philippine money.
Wherefore, as the share of these minors was 2/3 of P70,000 of P46,666.66, they should now return
P1,166.67.3Their promise to pay P10,000 in Philippine currency, (Exhibit A) can not be enforced, as
already stated, since they were minors incapable of binding themselves. Their liability, to repeat, is
presently declared without regard of said Exhibit A, but solely in pursuance of Article 1304 of the Civil
Code.
Accordingly, the appealed decision should be modified in the sense that Rosario Braganza shall pay
1/3 of P10,000 i.e., P3,333.334 plus 2% interest from October 1944; and Rodolfo and Guillermo
Braganza shall pay jointly5 to the same creditor the total amount of P1,166.67 plus 6% interest
beginning March 7, 1949, when the complaint was filed. No costs in this instance.
Paras, C.J., Padilla, Montemayor, Reyes, A., Bautista Angelo, Labrador, Concepcion and Endencia,
JJ., concur.

SECOND DIVISION
[G.R. No. 109312. March 29, 1996]

HEIRS OF PLACIDO MIRANDA, petitioners, vs. THE COURT OF

APPEALS, HON. RODOLFO TOLEDANO, Presiding Judge of
RTC, Iba, Zambales, Branch 69, AGERICO MIRANDA and his wife
JUANA MARCIA, CHARITO MIRANDA and her husband
TIMOTEO PAULE, herein represented by their Attorney-In-Fact,
EDITHA ZUNIGA, and THE REGISTER OF DEEDS OF IBA,
ZAMBALES, respondents.
[G.R. No. 120245. March 29, 1996]

ISMAEL ESMELE, ALFREDO MIRANDA, NOE MIRANDA, SR., NOE

MIRANDA, JR., AMOR LEDINA, FERDINAND LEDINA, PEDRO
REYES, FELIX REYES, NARCISO REYES, ROY BORJA, REMIGIO
ENCARNACION, ROBERTO DE LUNA, and SPS. EDEN LEDINA
and HECTOR SEVILLA,petitioners, vs. THE COURT OF
APPEALS, HON. FELIX MAMENTA, JR., Presiding Judge, RTC,
Branch 70, Iba, Zambales, CHARITO MIRANDA, and her husband
TIMOTEO PAULE, herein represented by their Attorney-in-Fact,
EDITHA ZUNIGA, respondents.
[Decision]

SYLLABUS
1. CIVIL LAW; MODES OF ACQUIRING OWNERSHIP; PRESCRIPTION;
TAX RECEIPTS AND DECLARATION OF OWNERSHIP FOR
TAXATION, WHEN COUPLED WITH PROOF OF ACTUAL
POSSESSION OF PROPERTY, CAN BE THE BASIS OF CLAIM OF
OWNERSHIP
THROUGH
PRESCRIPTION.
- Indeed
private
respondent Agerico Miranda acquired the land by virtue of a deed of
sale. His daughter, Charito, to whom the land was later transferred, has in
her favor a certificate of title, tax receipts and evidence of possession of
the land for more than 30 years. Tax receipts and declarations of
ownership for taxation, when coupled with proof of actual possession of
the property, can be the basis of claim of ownership through prescription.
2. ID.; ID.; ID.; OWNERSHIP AND OTHER REAL RIGHTS OVER
IMMOVABLE PROPERTY; HOW ACQUIRED. - Ownership and other real
rights over immovable property are acquired by ordinary prescription
through possession for ten years if the adverse possession is by virtue of
a title and it is in good faith. Without need of title or of good faith,
ownership and other real rights over immovables also prescribe through
uninterrupted adverse possession for 30 years. For possession to
constitute the foundation of a prescriptive right, it must be under a claim of
title or it must be adverse or in the concept of owner. In this case,
therefore, on the basis alone of possession for more than 30 years, private
respondents ownership, acquired through extraordinary prescription, is
beyond question.
3. ID.; CONTRACTS; VOIDABLE CONTRACTS; ARTICLE 1391 OF THE
CIVIL CODE PRESUPPOSES THAT NO ACQUISITIVE PRESCRIPTION
HAS SET IN. - Petitioners contend that under Art. 1391 of the Civil Code
they had a period of four (4) years within which to bring an action for
annulment and that this period commenced to run only from November
1991, when they allegedly discovered the fraud committed against
them. Art. 1391 presupposes, however, that no acquisitive prescription has
set in, for after the favorable effects of acquisitive prescription have set in,
rights of ownership over a property are rendered indisputable.

4. ID.; ID.; ID.; PETITIONERS CONTENTION THAT THE CONTRACT

OF SALE IN CASE AT BAR IS ABSOLUTELY SIMULATED AND,
THEREFORE, THE ACTION TO DECLARE ITS NULLITY IS
IMPRESCRIPTIBLE IS INCONSISTENT WITH HIS THEORY THAT THE
PRIVATE RESPONDENT ACQUIRED THE LAND THROUGH FRAUD;
CASE AT BAR. - Nor is it correct to say that the sale to private
respondents is absolutely simulated and, therefore, the action to declare
its nullity is imprescriptible. As Art. 1345 of the Civil Code provides, a
contract is simulated if the parties did pot intend to be bound at all. This is
completely the opposite of petitioners theory that private
respondent Agerico Miranda acquired the land fromMaximo Miranda
through fraud.
5. REMEDIAL LAW; CIVIL PROCEDURE; PRESCRIPTION MAY BE
EFFECTIVELY PLEADED IN A MOTION TO DISMISS IF THE
COMPLAINT SHOWS ON ITS FACE THAT THE ACTION HAS
ALREADY PRESCRIBED AT THE TIME IT WAS FILED. - The Regional
Trial Court dismissed the complaint upon motion by the private
respondents and after petitioners had been given full opportunity to
oppose the motion to dismiss through the presentation of argument. As
the question was whether petitioners action was barred by prescription or
private respondents had acquired ownership by prescription, there was no
need for the reception of oral evidence. Petitioners themselves stated in
their complaint that the sale, which they were seeking to annul, had been
made on November 5, 1957. Since their complaint was filed only on June
2, 1992, after almost 35 years, it was clear that acquisitive prescription
had set in. Prescription may be effectively pleaded in a motion to dismiss if
the complaint shows on its face that the action had already prescribed at
the time it was filed. In fact the trial court could have dismissed the
case motu proprio on this ground even though the private respondents did
not present a motion for the dismissal of the complaint.
6. ID.; ID.; APPEALS; A PARTY CANNOT SUBSTITUTE THE SPECIAL
CIVIL ACTION OF CERTIORARI UNDER RULE 65 OF THE RULES OF
COURT FOR THE REMEDY OF APPEAL. - Instead of appealing,
petitioners filed a petition for certiorari against the trial courts order of

dismissal. The issue in this case is whether the Court of Appeals erred in
dismissing petitioners action on the ground that certiorari was not the
proper remedy against the order of the trial court. We hold that the
appellate court did not err. The correct procedural recourse was appeal
not only because, as already explained, the trial court did not commit any
grave abuse of discretion in dismissing petitioners action without the
presentation of oral testimonies but also because the order of dismissal
was a final order from which petitioners could have appealed in
accordance with Rule 41, 2. Certiorari generally lies only when there is no
appeal nor any other plain, speedy or adequate remedy available to
petitioners. Here appeal was available. It was adequate to deal with any
question whether of fact or of law, whether of error of jurisdiction or grave
abuse of discretion or error of judgment which the trial court might have
committed. But petitioners instead filed a special civil action of certiorari. A
party cannot substitute the special civil action of certiorari under Rule 65 of
the Rules of Court for the remedy of appeal. The existence and availability
of the right of appeal are antithetical to the availability of the special civil
action of certiorari. As this Court held in Fajardo v. Bautista (232 SCRA
291 [1994]): Generally, an order of dismissal, whether right or wrong, is a
final order, and hence a proper subject of appeal, not certiorari. The
remedies of appeal and certiorari are mutually exclusive and not
alternative or successive. Accordingly, although the special civil action of
certiorari is not proper when an ordinary appeal is available, it may be
granted where it is shown that the appeal would be inadequate, slow,
insufficient, and will not promptly relieve a party from the injurious effects
of the order complained of, or where appeal is inadequate and
ineffectual. Nevertheless, certiorari cannot be a substitute for the lost or
lapsed remedy of appeal, where such loss is occasioned by the petitioners
own neglect or error in the choice of remedies. The Court of Appeals
therefore did not err in holding: The remedy of a petition for certiorari is
unavailing. This court possesses no authority to rule upon nonjurisdictional issues in a certiorari proceeding. A writ of certiorari may issue
only when the tribunal has acted without or in excess of its jurisdiction, or
with grave abuse of discretion and there is no appeal, nor any plain,
speedy and adequate remedy in the ordinary course of law.

7. ID.; BATAS PAMBANSA BLG. 129; INFERIOR COURTS MAY

DETERMINE QUESTIONS OF OWNERSHIP IN EJECTMENT CASES
WHENEVER NECESSARY TO DECIDE THE QUESTION OF
POSSESSION. - All ejectment cases are now covered by the summary
procedure regardless of whether they involve questions of
ownership. Under the Revised Rules on Summary Procedure, the
adjudication of cases is done on the basis of affidavits and position
papers. The court is no longer allowed to hold hearings to receive
testimonial evidence.Should the Court find it necessary to clarify certain
issues, it may require the parties instead to submit affidavits or other
evidence. The proceeding is required to be summary so as to promote the
speedy disposition of ejectment cases. Nor could the pendency of the
action for annulment of sale and reconveyance in the Regional Trial Court
be successfully pleaded in abatement of an action for unlawful detainer or
forcible entry. It is now settled that the court in ejectment cases may
determine questions of ownership whenever necessary to decide the
questions of possession. Nor may petitioners, by filing an action involving
the ownership of the land, frustrate the ejectment suit, brought by private
respondent. Inferior
courts
are
not
divested
of
jurisdiction
over ejectment cases just because the defendants assert ownership over
the litigated property. Indeed, the only issue in such cases is physical or
material possession or possession de facto, independent of any claim of
ownership set forth by any of the party litigants. The purpose of the suit is
the restoration to the aggrieved party of the possession of the premises
from which he has been forcibly ejected or which has been withheld from
him, and anyone who can prove prior possession de facto may recover
such possession. This rule holds true regardless of the character of a
partys possession, provided that he has in his favor priority of time which
entitles him to stay on the property until he is lawfully ejected.

DECISION
MENDOZA, J.:

These cases have been consolidated as they involve the same parties and
subject matter (a 21-hectare land in Pawa-Talon and Guintoan, Palauig,
Zambales) and related issues.
G.R. No. 109312 is a petition for review of the decision of the Court of
Appeals, sustaining the dismissal by the Regional Trial Court, Branch 69 at
Iba, Zambales, of a complaint which petitioners had filed for the annulment of
the sale of the land in question to private respondents. On the other
hand, G.R. No. 120245 is a petition for review of another decision of the
Court of Appeals, affirming the ejectment of petitioners from the land which is
the subject of G.R. No. 109312.
[1]

[2]

The facts are as follows:

Placido Miranda and his wife were owners of a parcel of land, consisting of
about 21 hectares, in Pawa-Talon and Guintoan, Palauig, Zambales. Upon
their death, the land was administered by their son Maximo
Miranda. On November 5, 1957 Maximo Miranda sold the land to Agerico
Miranda, then Provincial Treasurer of Zambales. On November 15, 1984, Free
Patent Title No. 600198 (OCT No. P-7753), covering the land in question, was
issued to Agerico Mirandas daughter, Charito. Since they acquired it from
Maximo Miranda, Agerico Miranda has been in possession and cultivation of
the land in behalf of his daughter, now a resident of New Jersey, U.S.A.
On December 28, 1991, the heirs of Placido Miranda entered the land and
prevented private respondents from cultivating it, claiming that they were the
rightful owners and possessors because Maximo Miranda was merely the
administrator of Placido Mirandas estate, and that Agerico Miranda, as
Provincial Treasurer, caused the preparation of a tax declaration in which it
was made to appear that Maximo Miranda was the sole owner of the land.
On January 24, 1992 private respondents brought an action for forcible
entry in the Municipal Circuit Trial Court of Masinloc and Palauig, Masinloc,
Zambales against petitioners. The complaint was dismissed by the court on
the ground that it had no jurisdiction over the case, but on appeal the Regional
Trial Court at Iba, Zambales reversed and remanded the case to the MCTC.

On the basis of the parties position papers, the documentary evidence

submitted
by
them
and
their
own
pleadings,
the
MCTC
on August 5, 1993 rendered judgment for private respondents, ordering
petitioners to vacate the land. Its decision was affirmed in toto by the Regional
Trial Court. Petitioners filed a Petition for Review in this Court (G.R. No.
114994) which referred the case to the Court of Appeals. On February 24,
1995, the appellate court rendered a decision dismissing the case for lack of
merit. Petitioners filed a motion for reconsideration which was denied. The
Court of Appeals decision is subject of the present petition for review on
certiorari in G.R. No. 120245.
On the other hand, petitioners herein filed on June 2, 1992 a complaint for
Declaration of Nullity, Annulment of Title and Deed of Sale and Cancellation of
Title and Reconveyance with Damages and Partition against private
respondents. Petitioners reiterated their contention that the sale of the land to
Agerico was fraudulent and therefore void. In addition they contended that the
certificate of title issued in the name of Agericos daughter, Charito Miranda,
was null and void because the latter was disqualified from owning lands in
the Philippines, having become a foreign citizen. They argued that in any
event prescription did not set in because actions to declare the inexistence of
an absolutely simulated contract do not prescribe and that if there was an
applicable period of prescription, it would be four (4) years from November
1991, when they allegedly discovered the fraud committed against them by
private respondents.
[3]

In answer, private respondents alleged that since 1957, they had been in
possession and cultivation of the land, planting it to mango and coconut trees.
After Charito Miranda had gone to the U.S.A., the land was administered by
her father, Agerico Miranda. Private respondents complained that petitioners
entered said land and prevented them from going into it.
Upon motion of private respondents, the Regional Trial Court dismissed
the complaint on the ground of prescription. Instead of appealing from the
decision, petitioners filed a special civil action for certiorari in the Court of
Appeals, which, on March 16, 1993, dismissed their action. Its decision is now
the subject of review in G.R. No. 109312.

Procedural and substantive issues are raised in these appeals for the
consideration of this Court. We shall deal with these appeals in inverse order.
In G.R. No. 109312 petitioners contend that because the Court of Appeals
did not set aside the order of the Regional Trial Court which dismissed their
action for the annulment of the sale on the ground of prescription, the
appellate court sanctioned a dismissal based purely on technicalities which
deprived petitioners of the opportunity to present evidence and thus violated
their right to due process.
The contention is without merit. The Regional Trial Court dismissed the
complaint upon motion by the private respondents and after petitioners had
been given full opportunity to oppose the motion to dismiss through the
presentation of argument. As the question was whether petitioners action was
barred by prescription or private respondents had acquired ownership by
prescription, there was no need for the reception of oral evidence. Petitioners
themselves stated in their complaint that the sale, which they were seeking to
annul, had been made onNovember 5, 1957. Since their complaint was filed
only on June 2, 1992, after almost 35 years, it was clear that acquisitive
prescription had set in. Prescription may be effectively pleaded in a motion to
dismiss if the complaint shows on its face that the action had already
prescribed at the time it was filed. In fact the trial court could have dismissed
the case motu proprio on this ground even though the private respondents did
not present a motion for the dismissal of the complaint.
[4]

Indeed private respondent Agerico Miranda acquired the land by virtue of

a deed of sale. His daughter, Charito, to whom the land was later transferred,
has in her favor a certificate of title, tax receipts and evidence of possession of
the land for more than 30 years. Tax receipts and declarations of ownership
for taxation, when coupled with proof of actual possession of the property, can
be the basis of claim of ownership through prescription.
[5]

[6]

Ownership and other real rights over immovable property are acquired by
ordinary prescription through possession for ten years if the adverse
possession is by virtue of a title and it is in good faith. Without need of title or
of good faith, ownership and other real rights over immovables also prescribe
through uninterrupted adverse possession for 30 years. For possession to
[7]

[8]

constitute the foundation of a prescriptive right, it must be under a claim of title

or it must be adverse or in the concept of owner. In this case, therefore, on
the basis alone of possession for more than 30 years, private respondents
ownership, acquired through extraordinary prescription, is beyond question.
[9]

Petitioners contend that under Art. 1391 of the Civil Code they had a
period of four (4) years within which to bring an action for annulment and that
this period commenced to run only from November 1991, when they allegedly
discovered the fraud committed against them. Art. 1391 presupposes,
however, that no acquisitive prescription has set in, for after the favorable
effects of acquisitive prescription have set in, rights of ownership over a
property are rendered indisputable.
[10]

Nor is it correct to say that the sale to private respondents is absolutely

simulated and, therefore, the action to declare its nullity is imprescriptible. As
Art. 1345 of the Civil Code provides, a contract is simulated if the parties did
not intend to be bound at all. This is completely the opposite of petitioners
theory that private respondent Agerico Miranda acquired the land from
Maximo Miranda through fraud.
Instead of appealing, petitioners filed a petition for certiorari against the
trial courts order of dismissal. The issue in this case is whether the Court of
Appeals erred in dismissing petitioners action on the ground that certiorari
was not the proper remedy against the order of the trial court. We hold that the
appellate court did not err. The correct procedural recourse was appeal not
only because, as already explained, the trial court did not commit any grave
abuse of discretion in dismissing petitioners action without the presentation of
oral testimonies but also because the order of dismissal was a final order from
which petitioners could have appealed in accordance with Rule 41, 2.
Certiorari generally lies only when there is no appeal nor any other plain,
speedy or adequate remedy available to petitioners. Here appeal was
available. It was adequate to deal with any question whether of fact or of law,
whether of error of jurisdiction or grave abuse of discretion or error of
judgment which the trial court might have committed. But petitioners instead
filed a special civil action of certiorari.

A party cannot substitute the special civil action of certiorari under Rule 65
of the Rules of Court for the remedy of appeal. The existence and availability
of the right of appeal are antithetical to the availability of the special civil action
of certiorari. As this Court held in Fajardo v. Bautista:
[11]

[12]

Generally, an order of dismissal, whether right or wrong, is a final order, and hence a
proper subject of appeal, not certiorari. The remedies of appeal and certiorari are
mutually exclusive and not alternative or successive. Accordingly, although the
special civil action of certiorari is not proper when an ordinary appeal is available, it
may be granted where it is shown that the appeal would be inadequate, slow,
insuffucient, and will not promptly relieve a party from the injurious effects of the
order complained of, or where appeal is inadequate and ineffectual. Nevertheless,
certiorari cannot be a substitute for the lost or lapsed remedy of appeal, where such
loss is occasioned by the petitioners own neglect or error in the choice of remedies.
The Court of Appeals therefore did not err in holding:
The remedy of a petition for certiorari is unavailing. This court possesses no authority
to rule upon non-jurisdictional issues in a certiorari proceeding. A writ of certiorari
may issue only when the tribunal has acted without or in excess of its jurisdiction, or
with grave abuse of discretion and there is no appeal, nor any plain, speedy and
adequate remedy in the ordinary course of law.
In G.R. No. 120245 petitioners argue that the use of summary procedure
in the MCTC was improper because there was a question of ownership
involved and a hearing should instead have been held according to regular
procedure. In support of their claim petitioners cite the following provision of
the Rules on Summary Procedure:
1. Scope. This Rules shall govern the procedure in the Metropolitan Trial Courts, the
Municipal Trial Courts, and the Municipal circuit Trial Courts in the following cases:
A. Civil Cases:
(1) Cases of forcible entry and unlawful detainer, except where the question of
ownership is involved, or where the damages or unpaid rentals sought to be recovered
by the plaintiff exceed twenty thousand pesos (P20,000.00) at the time of the filing of
the complaint;

The proceedings below were held, however, pursuant to the Revised

Rules on Summary Procedure which took effect on November 15, 1991, which
now provide:
1. Scope. - This rule shall govern the summary procedure in the Metropolitan Trial
Courts, the Municipal Trial Courts in Cities, the Municipal Trial Courts, and the
Municipal Circuit Trial Courts in the following cases falling within their jurisdiction:
A. Civil Cases:
(1) All cases of forcible entry and unlawful detainer, irrespective of the amount of
damages or unpaid rentals sought to be recovered. Where attorneys fees are awarded,
the same shall not exceed twenty thousand pesos (P20,000.00).
All ejectment cases are now covered by the summary procedure
regardless of whether they involve questions of ownership. Under the
Revised Rules on Summary Procedure, the adjudication of cases is done on
the basis of affidavits and position papers. The court is no longer allowed to
hold hearings to receive testimonial evidence. Should the Court find it
necessary to clarify certain issues, it may require the parties instead to submit
affidavits or other evidence. The proceeding is required to be summary so as
to promote the speedy disposition of ejectment cases.
[13]

[14]

[15]

Nor could the pendency of the action for annulment of sale and
reconveyance in the Regional Trial Court be successfully pleaded in
abatement of an action for unlawful detainer or forcible entry. It is now settled
that the court in ejectment cases may determine questions of ownership
whenever necessary to decide the questions of possession. Nor may
petitioners, by filing an action involving the ownership of the land, frustrate the
ejectment suit, brought by private respondent. Inferior courts are not divested
of jurisdiction over ejectment cases just because the defendants assert
ownership over the litigated property.
[16]

Indeed, the only issue in such cases is physical or material possession or

possession de facto, independent of any claim of ownership set forth by any
of the party litigants. The purpose of the suit is the restoration to the aggrieved
party of the possession of the premises from which he has been forcibly

ejected or which has been withheld from him, and anyone who can prove prior
possession de facto may recover such possession. This rule holds true
regardless of the character of a partys possession, provided that he has in his
favor priority of time which entitles him to stay on the property until he is
lawfully ejected.
[17]

WHEREFORE, the petitions for review in these cases are DISMISSED

and the decisions of the Court of Appeals are AFFIRMED.
SO ORDERED.
Regalado, Romero, and Puno, JJ., concur.
Torres, Jr., J., on leave.