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G.R. No.

L-59621 February 23, 1988


MAXIMILIANO ALVAREZ, petitioner,
vs.
HON. COURT OF APPEALS, HON. MILAGROS V. CAGUIOA, as
Presiding Judge of Branch VIII, Court of First Instance of
Quezon & Lucena City, Atty. ELENO M. JOYAS, as Provincial
Sheriff of Quezon, FRANCISCO T. FORTUNADO, Deputy Sheriff
of Quezon and ATTY. FELICISIMO S. GARIN, respondents.
PADILLA, J.:
Petition for review on certiorari of the Resolution * of the Court of
Appeals dated 23 October 1980 in CA-G.R. No. SP-10069, entitled
"Maximiliano Alvarez, petitioner, versus Hon. Milagros V. Caguioa, etc.
et al., respondents" setting aside its earlier decision of 16 May
1980,** and the Resolution dated 20 January 1982 denying
petitioner's Motion for Reconsideration of the Resolution of 23 October
1980.
Renato Ramos was charged with Double Homicide with Multiple
Serious Physical Injuries Through Reckless Imprudence in the Court of
First Instance of Quezon Province. After trial, the court rendered
judgment against the accused, the dispositive part of which reads as
follows:

engaged in any kind of industry . . . .' He should, therefore, be


subsidiarily liable and pay the amount above-mentioned to the
persons concerned jointly and severally with Renato Ramos The bail
bond filed by the accused Renato Ramos for his provisional liberty is
hereby ordered cancelled. 1
The accused appealed to the Court of Appeals, where the appeal was
docketed as CA-G.R. No. 19077-CR. On 13 December 1977, the Court
of appeals affirmed the trial court's decision but deleted that part
thereof making herein petitioner, as employer of Renato Ramos,
subsidiarily liable for payment of the adjudged indemnities to the
offended parties. The Court of appeals, in said CA-G.R. No. 19077-CR,
reasoned thus:
There is merit in the appellant's contention that the trial court erred in
ordering Maximiliano Alvarez to be subsidiarily liable with the
appellant in the payment of the indemnities awarded in favor of the
offended parties and the heirs of the deceased. Maximiliano Alvarez is
not a party in this action. Altho it is the law that employers are
subsidiarily liable for the civil liability of their employees for felonies
committed in the discharge of the latter's duties if they are engaged
in any kind of industry (Art. 103, Revised Penal Code), such subsidiary
liability is not litigated in connection with the criminal prosecution of
the employees and may not therefore be adjudged therein (Philippine
Railways Company v. Jalandoni, CA, 40 O.G. 19). It is true that the
judgment of conviction in the criminal case binds the person
subsidiarily liable with the accused (Martinez v. Barredo, 81 Phil. 1),
and it is therefore the duty of the employer to participate in the
defense of his employee (Miranda v. Malate Garage, 99 Phil. 670). The
law, however, does not authorize that the subsidiary liability of the
employer be adjudged in the criminal action. This is because, in the
criminal proceeding, the employer, not being a party, is denied the
opportunity to present his defense against such subsidiary liability,
such as, his not being engaged in any kind of industry or that the
crime committed by his employee was not on the occasion of the
discharge of the latter's duties. Due regard to due process and
observance of procedural requirements demand that a separate
action should be filed against the supposed employer to enforce the
subsidiary liability under Article 103 of the Revised Penal Code. 2
The appellate court's decision in CA-G.R. No. 19077-CR was not
appealed. Meanwhile, on 14 December 1978, Pajarito v. Seneris 3 was
decided by this Court, holding inter alia that--

This Court, therefore, finds the accused Renato Ramos guilty of


negligence and sentences him to pay a fine of TWO HUNDRED
(P200.00) PESOS, with subsidiary imprisonment in case of insolvency.
He is civilly liable for the death and physical injuries that resulted from
the collision of the sakbayan and the weapon's [sic] carrier. He should
indemnify the heirs of the deceased Rodolfo Briones the amount of
TWELVE THOUSAND (P12,000.00) PESOS, as actual damages; the
heirs of the deceased Juan Briones, the amount of TWELVE THOUSAND
(Pl2,000.00) PESOS, as actual damages; Socorro Briones, the amount
of FIFTEEN THOUSAND (P l5,000.00) PESOS, hospitalization and burial
expenses; Exaltacion de Gala the amount of THREE THOUSAND
(P3,000.00) PESOS, hospitalization and incidental expenses; Basilica
de Gala the amount of THREE THOUSAND (P3,000.00) PESOS,
hospitalization and incidental expenses; to Joselito Leonor and Cenon
Leonor, for actual damages and for permanent facial deformity, the
amount of FIFTEEN THOUSAND (Pl5,000.00) PESOS and for attomey's
fees, the amount of TWO THOUSAND (P2,000.00) PESOS. . . .
The records show that Maximiliano Alvarez is engaged in his business
of buying coconuts and copra for re-sale, therefore, he is ' . . .

Considering that the judgment of conviction, sentencing a defendant


employee to pay an indemnity under Articles 102 and 103 of the
Revised Penal Code, is conclusive upon the employer not only with
regard to the latter's civil liability but also with regard to its
amount, . . . in the action to enforce the employer's subsidiary
liability, the court has no other function than to render decision based
upon the indemnity awarded in the criminal case and has no power to
amend or modify it even if in its opinion an error has been committed
in the decision.

private prosecutor filed a "Motion for Issuance of Subsidiary Writ of


Execution" after the writ of execution against the accused was
returned unsatisfied on 27 February 1979. 5 Petitioner opposed the
Motion. However, on 14 November 1979, respondent Judge ordered
the issuance of the subsidiary writ of execution. A motion for
reconsideration of this order was denied in an order dated 26
November 1979.
Consequently, on 29 November 1979, petitioner filed a petition for
certiorari with the Court of appeals, questioning the acts of the
respondent Judge and the Sheriff who had levied on his properties
pursuant to said subsidiary writ of execution. The petition was
docketed as CA-G.R. No. SP-10069.
On 16 May 1980, the Court of appeals granted the petition and
declared the Orders of the respondent Judge, dated 14 November
1979 and 26 November 1979, as well as the Subsidiary Writ of
Execution issued on 15 November 1979 null and void. It reasoned
that, as its judgment in the criminal case (CA-G.R. No. 19077-CR) was
promulgated
on
13
December
1977,
whereas, Pajarito was
promulgated by the Supreme Court only on 14 December 1978, the
final judgment in the criminal case, which expressly declared that a
separate action should be instituted to enforce petitioner's subsidiary
civil liability, had long become the "law of the case" 6 and, therefore,
prevails.
On 24 July 1980, respondents filed a Motion for Reconsideration. On
23 October 1980, the Motion was granted and the decision of 16 May
1980 was set aside on the strength of thePajarito decision. said the
Court of Appeals:

In view of the foregoing principles, . . . it would serve no important


purpose to require petitioner to file a separate and independent action
against the employer for the enforcement of the latter's subsidiary
civil liability. Under the circumstances, it would not only prolong the
litigation but would require the heirs of the d victim to incur
unnecessary expenses. At any rate, the proceeding for the
enforcement of the subsidiary civil liability may be considered as part
of the proceeding for the execution of the judgment. A case in which
an execution has been issued is regarded as still pending so that all
proceedings on the execution are proceedings in the suit. There is no
question that the court which rendered the judgment has a general
supervisory control over its process of execution, and this power
carries with it the right to determine every question of fact and law
which may be involved in the execution.
... Indeed, the enforcement of the employer's subsidiary civil liability
may be conveniently litigated within the same proceeding because
the execution of the judgment is a logical and integral part of the case
itself. This would certainly facilitate the application of justice to the
rival claims of the contending parties. "The purpose of procedure,"
observed this Court in Manila Railroad Co. v. Attorney General, is not
to thwart justice. Its proper aim is to facilitate the application of
justice to the rival claims of the contending parties. It was created not
to hinder and delay but to facilitate and promote the administration of
justice.' In proceedings to apply justice, it is the duty of the courts 'to
assist the parties in obtaining just, speedy, and inexpensive
determination' of their rival claims. Thus, the Rules require that they
should liberally construed "to promote their object and to assist the
parties in obtaining just, speedy, and inexpensive determination of
every action and proceedings." 4
After finality of the Court of appeal judgment in CA-G.R. No. 19077-CR,
the case was remanded to the trial court where, on 2 July 1979, the

The doctrine of the "law of the case" is ordinarily a very wise rule of
action, but it is not a universal, inexorable command. For while the
doctrine is generally deemed applicable whether the former
determination is right or wrong, (Wills vs. Lloyd, 21 Cal. 2d 452,132 p.
20 471, 474; In re Taylor's Estate, 110 Vt. 80, 2 A. 2d 317, 319;
Greenwood Country vs. Watkins, 196 S.C. 51, 12 S.E. 2d 545, 550),
there are some cases which hold that the doctrine is in applicable
where [the] prior decision is unsound (Standard Oil Co. of California
vs. Johnson, 56 Cal. App. 2d 411, 132 P. 2d 910, 913; Atchison T.& S.F.
Ry Co. vs. Ballard, C.C.A. Tax 108 F. 2d 768, 772); or incorrect
principles were announced or [al mistake of fact was made on first
appeal. (Nation of Match Co. vs. Empire Storage & Ice Co., 227 Mo
Supp. 11 5, 58 S.W. 2d 997; Morris vs. E.I.Du Pont De Nemours & Com;
346 Mo. 126,139 S.W. 2d 984,986, 129 A.L.R. 352).

liability is a surplausage although We should not, in the least,


begrudge the trial court in having done so. It was, perhaps, to him, an
attempt to be emphatic, or if not, a matter of legal taste than an
answer to a legal requirement. In other words, even if the
pronouncement and direction of the subsidiary liability of the
employer were not written in the dispositive portion of the decision, or
any part of the decision for that matter, just the same the trial court,
upon the finality of its decision, can order the employer, on its
subsidiary liability, to answer for the civil liability of the convicted
employee, if the latter is shown to be unable to satisfy his civil liability
because of his insolvency.

It is a peculiar virtue of our system of law that in the search for truth
through the process of inclusion and exclusion, it behooves us to
correct the application of the doctrine of "the law of the case" upon
such questions which prove to have been mistaken.
. . . [T]he Honorable Supreme Court in the case of Lucia Pajarito vs.
Hon. Alberto V. Seneris, et. al. (G.R. No. L-44627, December 14, 1978;
87 SCRA 275) has definitely set the rule that;
. . . considering that Felipe Aizon does not deny that he was the
registered operator of the bus . . ., it would serve no important
purpose to require petitioner to file a separate and independent action
against the employer for the enforcement of the latter's subsidiary
civil liability . . . . At any rate, the proceeding for the enforcement of
the subsidiary civil liability may be considered as part of the
proceeding for the execution of the judgment. A case in which an
execution has been issued is regarded as still pending so that all
proceedings on the execution are proceedings in the suit."
xxx xxx xxx
xxx xxx xxx
xxx xxx xxx

To underscore, Our deletion from Our decision in CA-G.R. No. 19077CR, therefore, of the trial court's pronouncement and directions on the
subsidiary liability of Maximiliano Alverez would have not prevented
the respondent court from issuing the writ of subsidiary execution and
all other matters now under question.
On the issue of the deprivation of the employer of due process, unless
he is allowed his day in court in the enforcement of his subsidiary
liability in a separate civil action, the Honorable Supreme Court, citing
relevant holdings in previous cases said:

Indeed, the enforcement of the employer's subsidiary civil liability


may be conveniently litigated within the same proceeding because
the execution of the judgment is a logical and integral part of the case
itself. (pp. 282, 283)

The employer cannot be said to have been deprived of his day in


court, because the situation before us is not one wherein the
employer is sued for a primary liability under articles 1903 of the Civil
Code, but one in which enforcement is sought of a subsidiary civil
liability incident to and dependent upon his driver's criminal
negligence which is a proper issue to be tried and decided only in a
criminal action. In other words, the employer becomes ipso
facto subsidiarily liable upon his driver's conviction and upon proof of
the latter's insolvency, in the same way that acquittal wipes out not
only the employee's primary civil liability but also his employer's
subsidiary liability for such criminal negligence. (Almeda et al. vs.
Albaroa, 8 Phil. 178, affirmed in 218 U.S. 476, 54 Law ed., 116; Wise &
Co. vs. Larion 45 Phil. 314, 320; Francisco vs. Onrubia, 46 Phil. 327;
Province of Ilocos Sur vs. Tolentino, G.R. No. 34186,56 Phil. 829;
Moran, Comments on the Rules of Court, Vol. II, p. 403) (Martinez vs.
Barredo, 81 Phil. 1).
Then, the Supreme Court went on to say:

[W]hile We had, by our Decision in CA-G.R. No. 19077-CR, modified


the decision of the trial court when, among such modifications. We
deleted the trial court's direction, in the dispositive portion of said
decision, that Maximiliano Alverez 'should, therefore, be subsidiarily
liable and pay the amount above-mentioned to the persons concerned
jointly and severally with Renato Ramos,' and all other references of
the trial court of Articles 102 and 103 of the Revised Penal Code, yet
such modification does not reduce the effectiveness nor prevent the
application of the ruling laid down in the case of Lucia S. Pajarito vs.
Hon. Alberto V. Seneris et. al. Indeed, it was not necessary at all for
the trial court to have pronounced, in the dispositive portion of its
decision, on the subsidiary liability of the employer, Maximiliano
Alvarez, because the provisions of the Revised Penal Code on
subsidiary liability (Articles 102 and 103) are deemed written in the
judgment in the respective cases in which they are applicable. In a
word, such a pronouncement and a direction of such subsidiary

In Miranda vs. Malate Garage & Taxicab Inc. this Court father
amplified the rule that the decision convicting the employee is binding
and conclusive upon the employer, "not only with regard to (the
latter's) civil liability but also with regard to its amount because the
liability of an employer can not be separated but following that of his
employee ... And this Court, in Miranda further explained that the
employer is in substance and in effect a party to the criminal case,
considering the subsidiary liability imposed upon him by law.

WHEREFORE, We set aside Our decision promulgated on May 16,1980,


and enter another dismissing the instant petition for lack of merit.
With costs against petitioner. 7
Petitioner filed a motion for reconsideration of the above Resolution.
He pointed out that the 16 May 1980 decision of the Court of Appeals
had already become final and executory when respondents, through
counsel, filed their Motion for Reconsideration, hence, the Court of
appeals no longer had jurisdiction to reverse itself. He argued that the
16 May 1980 decision was already the "law of the case' as far as
petitioner's subsidiary liability is concerned, notwithstanding Pajarito.
Petitioner also cited the "bad faith" of respondents' counsel in
deliberately instructing his clerks not to receive the 16 May 1980
decision on the day of its service on 22 May 1980, while he was still in
the United States, with the consequent finality of the decision thirty
(30) days from the day it should have been received by respondents'
counsel. Respondents could not, according to petitioner, have
belatedly asked for reconsideration on 24 July 1980. 8 He further
pointed to the none-existence of the Pajarito doctrine on 13
December 1977, the day judgment of conviction against the accused
employee Renato Ramos was affirmed by the Court of Appeals,
excluding the trial court's order finding petitioner-employer
subsidiarily liable in case Ramos was found insolvent.
The Court of Appeals denied petitioner's motion for reconsideration in
its Resolution dated 20 January 1982.
Hence, petitioner's present recourse to this Court. The petition is not
impressed with merit.
While counsel for respondents could have been more efficient and
even scrupulous in the receipt of the adverted to decision of 16 May
1980, his censurable act cannot be made the basis for a strict and
rigorously technical interpretation of procedural rules on grounds
which do not touch on the merits of the criminal case but win only
needlessly prolong its course and unjustly delay relief to the victims of
petitioner-employer's criminally negligent driver.
It is already a settled rule that the subsidiary liability of an employer
automatically arises upon his employee's conviction, and subsequent
proof of inability to pay. In this light, the application of Pajarito is
merely the enforcement of a procedural remedy designed to ease the
burden of litigation for recovery of indemnity by the victims of a
judicially-declared criminally negligent act.
As has been aptly stated,

It is true that an employer, exactly speaking, is not a party to the


criminal case instituted against his employee, but, in substance and in
effect he is [,] considering the subsidiary liability imposed upon him
by law. It is his concern. as well as of his employee, to see to it that
his interest be protected in the criminal case by taking virtual
participation in the defense of his employee. He cannot leave him to
his own fate because his failure is also his. And if because of his
indifference or inaction the employee is convicted and damages are
awarded against him, he cannot later be heard to complain, if brought
to court, for the enforcement of his subsidiary liability, that he was not
given his day in court.
This is the rule that governs the case at bar. It does not matter now
that Our decision in CA-G.R. No. 19077-CR was promulgated on
December 13, 1977 while the case of Pajarito vs. Seneris was
promulgated later on on [sic] December 14, 1978. This fact alone
would not prevent the application of the Pajarito vs. Senerisruling to
the execution of the case at bar, because, firstly, the Seneris case is
merely a reiteration and perhaps an amplification of the previous
rulings in the Miranda and the Martinez cases adopted much earlier
than the rendition of the trial court's decision, subject of the appeal in
CA G.R. No. 19077-CR; and secondly, because, for all purposes of the
execution of Our decision in CA-G.R. No. 19077-CR, the said case is
still pending and there is no legal impediment to the application, even
retroactively if private respondents think it that way, of the Seneris
ruling to the execution of Our decision.
We hold, therefore, that the respondent Court has not committed any
grave abuse of discretion in the issuance of the questioned orders for
such issuance has been made in pursuance of law and jurisprudence.

A separate civil action may be warranted where additional facts have


to be established or more evidence must be adduced or where the
criminal case has been fully terminated and a separate complaint
would be just as efficacious or even more expedient than a timely
remand to the trial court where the criminal action was decided for
further hearings on the civil aspects of the case.... These do not exist
in this case. Considering moreover the delays suffered by the case in
the trial, appellate, and review stages, it would be unjust to the
complainants in this case to require at this time a separate civil action
to be filed. 9 (Emphasis supplied)
Moreover, the principle of "law of the case" as discussed in People vs.
Pinuila 10 is not applicable to a Court of Appeals decision at odds with
this Court's decision, and where the Supreme Court still has the power
to decide on the applicable doctrine to the issue at hand. The rule
cannot be utilized to accomplish injustice or manifest delay in the
execution of justice. The principle is merely a rule of convenience and
public
policy
to
stabilize
judicial
decisions
of
tribunals
of coordinate jurisdiction, to prevent re-litigation of questions in the
same action, and to obviate undue prolongation of litigation, purposes
which would be negated if Pajarito were not to be applied in this case
simply because of purely technical reasons not touching on the merits
of the case.
One last word: there is sufficient evidence to hold that counsel for
respondents, Felicisimo S. Garin, deliberately skirted the first service
on him of the Court of Appeals judgment of 16 May 1980. He wanted
it served on him at his own convenience. We note his action with
great disapproval. As an officer of the court, he must conduct himself
with candor and sincerity. He is warned that any repetition of this or
similar misconduct will be dealt with severely.
WHEREFORE, the petition is hereby DENIED. The Resolutions of the
Court of Appeals, dated 23 October 1980 and 20 January 1982, are
AFFIRMED Costs against the petitioner.
SO ORDERED.
Yap (Chairman), Melencio-Herrera, Paras and Sarmiento, JJ., concur.
Footnotes

** In CA-G.R. No. 10069-SP, penned by Justice Corazon Juliano Agrava,


with the concurrence of Justices Guillermo P. Villasor and Elias B.
Asuncion.
1 Rollo at 61.
2 Rollo at 74-75.
3 G.R. No. L-44627, December 14,1978,87 SCRA 275.
4 Id at 282-283.
5 Rollo at 77.
6 Rollo at 171-172.
7 Rollo at 190-194.
8 REVISED RULES OF COURT, Sec. 3, Rule 41, now Sec. 39 BP Blg. No.
129, otherwise known as the Judiciary Act of 1981, which has reduced
the period within which appeal may be taken to fifteen (15) days,
except in habeas corpus cases.
9 Padilla vs. CA, 129 SCRA 559, 570 (1984).
10 103 Phil. 992 (1958). "'Law of the case' has been defined as the
opinion delivered on a former appeal. More specifically, it means that
whatever is once irrevocably established as the controlling legal rule
of decision between the same parties in the same case continues to
be the law of the case, whether correct on general principles or not,
so long as the facts on which such decision was predicated continue
to be the facts of the case before the court,' et seq. (Id. at 999).

* Penned by Justice Elias B. Asuncion with the concurrence of Justice


Guillermo P. Villasor and concurrence in the result of Justice Oscar R.
Victorians.

The parcel of land under litigation is Lot No. 2476 of the Subdivision
Plan Psd-37365 containing an area of 20,119 square meters and
situated at Gusa, Cagayan de Oro City. Said lot was acquired by
purchase from the late Luis Lancero on September 15, 1964 as per
Deed of Absolute Sale executed in favor of plaintiff and by virtue of
which Transfer Certificate of Title No. 4320 was issued to plaintiff
(DELCOR for brevity). Luis Lancero, in turn acquired the same parcel
from Ricardo Gevero on February 5, 1952 per deed of sale executed
by Ricardo Gevero which was duly annotated as entry No. 1128 at the
back of Original Certificate of Title No. 7610 covering the mother lot
identified as Lot No. 2476 in the names of Teodorica Babangha 1/2
share and her children: Maria; Restituto, Elena, Ricardo, Eustaquio and
Ursula, all surnamed surnamed Gevero, 1/2 undivided share of the
whole area containing 48,122 square meters.
Teodorica Babangha died long before World War II and was survived
by her six children aforementioned. The heirs of Teodorica Babangha
on October 17,1966 executed an Extra-Judicial Settlement and
Partition of the estate of Teodorica Babangha, consisting of two lots,
among them was lot 2476. By virtue of the extra-judicial settlement
and partition executed by the said heirs of Teodorica Babangha, Lot
2476-A to Lot 2476-I, inclusive, under subdivision plan (LRC) Psd80450 duly approved by the Land Registration Commission, Lot 2476D, among others, was adjudicated to Ricardo Gevero who was then
alive at the time of extra-judicial settlement and partition in 1966.
Plaintiff (private respondent herein) filed an action with the CFI (now
RTC) of Misamis Oriental to quiet title and/or annul the partition made
by the heirs of Teodorica Babangha insofar as the same prejudices the
land which it acquired a portion of lot 2476.
Plaintiff now seeks to quiet title and/or annul the partition made by
the heirs of Teodorica Babangha insofar as the same prejudices the
land which it acquired, a portion of Lot 2476. Plaintiff proved that
before purchasing Lot 2476-A it first investigated and checked the title
of Luis Lancero and found the same to be intact in the office of the
Register of Deeds of Cagayan de Oro City. The same with the
subdivision plan (Exh. "B"), the corresponding technical description
(Exh. "P") and the Deed of Sale executed by Ricardo Gevero all of
which were found to be unquestionable. By reason of all these,
plaintiff claims to have bought the land in good faith and for value,
occupying the land since the sale and taking over from Lancero's
possession until May 1969, when the defendants Abadas forcibly
entered the property. (Rollo, p. 23)

G.R. No. 77029 August 30, 1990


BIENVENIDO, ESTELITA, MACARIO, LUIS, ADELAIDE, ENRIQUITA
and CLAUDIO, all surnamed, GEVERO, petitioners,
vs.
INTERMEDIATE APPELLATE COURT and DEL MONTE
DEVELOPMENT CORPORATION, respondents.
Carlito B. Somido for petitioners.
Benjamin N. Tabios for private respondent.
PARAS, J.:
This is a petition for review on certiorari of the March 20, 1988
decision 1 of the then Intermediate Appellate Court (now Court of
Appeals) in AC-GR CV No. 69264, entitled Del Monte Development
Corporation vs. Enrique Ababa, et al., etc. affirming the decision 2 of
the then Court of First Instance (now Regional Trial Court) of Misamis
Oriental declaring the plaintiff corporation as the true and absolute
owner of that portion of Lot 476 of the Cagayan Cadastre, particularly
Lot No. 2476-D of the subdivision plan (LRC) Psd-80450, containing an
area of Seven Thousand Eight Hundred Seventy Eight (7,878) square
meters more or less.
As found by the Appellate Court, the facts are as follows:

After trial the court a quo on July 18, 1977 rendered judgment, the
dispositive portion of which reads as follows:
WHEREFORE, premises considered, judgment is hereby rendered
declaring the plaintiff corporation as the true and absolute owner of
that portion of Lot No. 2476 of the Cagayan Cadastre, particularly Lot
No. 2476-D of the subdivision plan (LRC) Psd-80450, containing an
area of SEVEN THOUSAND EIGHT HUNDRED SEVENTY EIGHT (7,878)
square meters, more or less. The other portions of Lot No. 2476 are
hereby adjudicated as follows:
Lot No. 2476 B to the heirs of Elena Gevero;
Lot No. 2476 C to the heirs of Restituto Gevero;
Lot No. 2476 E to the defendant spouses Enrique C. Torres and
Francisca Aquino;
Lot No. 2476 F to the defendant spouses Eduard Rumohr and
Emilia Merida Rumohf ;
Lot Nos. 2476-H, 2476-I and 2476 G to defendant spouses
Enrique Abada and Lilia Alvarez Abada.
No adjudication can be made with respect to Lot No. 2476-A
considering that the said lot is the subject of a civil case between the
Heirs of Maria Gevero on one hand and the spouses Daniel Borkingkito
and Ursula Gevero on the other hand, which case is now pending
appeal before the Court of Appeals. No pronouncement as to costs, SO
ORDERED. (Decision, Record on Appeal, p. 203; Rollo, pp. 21-22)
From said decision, defendant heirs of Ricardo Gevero (petitioners
herein) appealed to the IAC (now Court of Appeals) which
subsequently, on March 20, 1986, affirmed the decision appealed
from.
Petitioners, on March 31, 1986, filed a motion for reconsideration
(Rollo, p. 28) but was denied on April 21, 1986.
Hence, the present petition.
This petition is devoid of merit.
Basically, the issues to be resolved in the instant case are: 1) whether
or not the deed of sale executed by Ricardo Gevero to Luis Lancero is
valid; 2) in the affirmative, whether or not the 1/2 share of interest of
Teodorica Babangha in one of the litigated lots, lot no. 2476 under
OCT No. 7610 is included in the deed of sale; and 3) whether or not
the private respondents' action is barred by laches.
Petitioners
maintain
that
the deed
of sale is
entirely
invalid citing alleged flaws thereto, such as that: 1) the signature of
Ricardo was forged without his knowledge of such fact; 2) Lancero had
recognized the fatal defect of the 1952 deed of sale when he signed
the document in 1968 entitled "Settlement to Avoid the Litigation"; 3)

Ricardo's children remained in the property notwithstanding the sale


to Lancero; 4) the designated Lot No. is 2470 instead of the correct
number being Lot No. 2476; 5) the deed of sale included the share of
Eustaquio Gevero without his authority; 6) T.C.T. No. 1183 of Lancero
segregated the area of 20,119 square meters from the bigger area
(OCT No. 7616) without the consent of the other co-owners; 7)
Lancero caused the 1952 Subdivision survey without the consent of
the Geveros' to bring about the segregation of the 20,119 square
meters lot from the mother lot 2476 which brought about the issuance
of his title T-1183 and to DELCOR's title T4320, both of which were
illegally issued; and 8) the area sold as per document is 20,649
square meters whereas the segregated area covered by TCT No. T1183 of Lancero turned out to be 20,119 square meters (Petitioners
Memorandum, pp. 62-78).
As to petitioners' claim that the signature of Ricardo in the 1952 deed
of sale in favor of Lancero was forged without Ricardo's knowledge of
such fact (Rollo, p. 71) it will be observed that the deed of sale in
question was executed with all the legal formalities of a public
document. The 1952 deed was duly acknowledged by both parties
before the notary public, yet petitioners did not bother to rebut the
legal presumption of the regularity of the notarized document (Dy v.
Sacay, 165 SCRA 473 [1988]); Nuguid v. C.A., G.R. No. 77423, March
13, 1989). In fact it has long been settled that a public document
executed and attested through the intervention of the notary public is
evidence of the facts in clear, unequivocal manner therein expressed.
It has the presumption of regularity and to contradict all these,
evidence must be clear, convincing and more than merely
preponderant (Rebuleda v. I.A.C., 155 SCRA 520-521 [1987]). Forgery
cannot be presumed, it must be proven (Siasat v. IAC, No. 67889,
October 10, 1985). Likewise, petitioners allegation of absence of
consideration of the deed was not substantiated. Under Art. 1354 of
the Civil Code, consideration is presumed unless the contrary is
proven.
As to petitioners' contention that Lancero had recognized the fatal
defect of the 1952 deed when he signed the document in 1968
entitled "Settlement to Avoid Litigation" (Rollo, p. 71), it is a basic rule
of evidence that the right of a party cannot be prejudiced by an act,
declaration, or omission of another (Sec. 28. Rule 130, Rules of Court).
This particular rule is embodied in the maxim "res inter alios acta
alteri nocere non debet." Under Section 31, Rule 130, Rules of Court
"where one derives title to property from another, the act, declaration,
or omission of the latter, while holding the title, in relation to the

property is evidence against the former." It is however stressed that


the admission of the former owner of a property must have been
made while he was the owner thereof in order that such admission
may be binding upon the present owner (City of Manila v. del Rosario,
5 Phil. 227 [1905]; Medel v. Avecilla, 15 Phil. 465 [1910]). Hence,
Lanceros' declaration or acts of executing the 1968 document have no
binding effect on DELCOR, the ownership of the land having passed to
DELCOR in 1964.
Petitioners' claim that they remained in the property, notwithstanding
the alleged sale by Ricardo to Lancero (Rollo, p. 71) involves a
question of fact already raised and passed upon by both the trial and
appellate courts. Said the Court of Appeals:
Contrary to the allegations of the appellants, the trial court found that
Luis Lancero had taken possession of the land upon proper
investigation by plaintiff the latter learned that it was indeed Luis
Lancero who was the owner and possessor of Lot 2476 D. . . .
(Decision, C.A., p. 6).
As a finding of fact, it is binding upon this Court (De Gola-Sison v.
Manalo, 8 SCRA 595 [1963]; Gaduco vs. C.A., 14 SCRA 282 [1965];
Ramos v. Pepsi-Cola, 19 SCRA 289 [1967]; Tan v. C.A., 20 SCRA 54
[1967]; Ramirez Tel. Co. v. Bank of America, 33 SCRA 737 [1970];
Lucero v. Loot, 25 SCRA 687 [1968]; Guerrero v. C.A., 142 SCRA 130
[1986]).
Suffice it to say that the other flaws claimed by the petitioners which
allegedly invalidated the 1952 deed of sale have not been raised
before the trial court nor before the appellate court. It is settled
jurisprudence that an issue which was neither averred in the
complaint nor raised during the trial in the court below cannot be
raised for the first time on appeal as it would be offensive to the basic
rules of fair play, justice and due process. (Matienzo v. Servidad, 107
SCRA 276 [1981]; Dela Santa v. C.A., 140 SCRA 44 [1985]; Dihiansan
v. C.A., 157 SCRA 434 [1987]; Anchuelo v. IAC, 147 SCRA 434 [1987];
Dulos Realty and Development Corporation v. C.A., 157 SCRA [1988];
Kamos v. IAC, G.R. No. 78282, July 5, 1989).
Petitioners aver that the 1/2 share of interest of Teodorica (mother of
Ricardo) in Lot 2476 under OCT No. 7610 was not included in the deed
of sale as it was intended to limit solely to Ricardos' proportionate
share out of the undivided 1/2 of the area pertaining to the six (6)
brothers and sisters listed in the Title and that the Deed did not
include the share of Ricardo, as inheritance from Teodorica, because
the Deed did not recite that she was deceased at the time it was
executed (Rollo, pp. 67-68).

The hereditary share in a decedents' estate is transmitted or vested


immediately from the moment of the death of the "causante" or
predecessor in interest (Civil Code of the Philippines, Art. 777), and
there is no legal bar to a successor (with requisite contracting
capacity) disposing of his hereditary share immediately after such
death, even if the actual extent of such share is not determined until
the subsequent liquidation of the estate (De Borja v. Vda. de Borja, 46
SCRA 577 [1972]).
Teodorica Babangha died long before World War II, hence, the rights to
the succession were transmitted from the moment of her death. It is
therefore incorrect to state that it was only in 1966, the date of
extrajudicial partition, when Ricardo received his share in the lot as
inheritance from his mother Teodorica. Thus, when Ricardo sold his
share over lot 2476 that share which he inherited from Teodorica was
also included unless expressly excluded in the deed of sale.
Petitioners contend that Ricardo's share from Teodorica was excluded
in the sale considering that a paragraph of the aforementioned deed
refers merely to the shares of Ricardo and Eustaquio (Rollo, p. 67-68).
It is well settled that laws and contracts shall be so construed as to
harmonize and give effect to the different provisions thereof
(Reparations Commission v. Northern Lines, Inc., 34 SCRA 203 [1970]),
to ascertain the meaning of the provisions of a contract, its entirety
must be taken into account (Ruiz v. Sheriff of Manila, 34 SCRA 83
[1970]). The interpretation insisted upon by the petitioners,
by citing only one paragraph of the deed of sale, would not only
create contradictions but also, render meaningless and set at naught
the entire provisions thereof.
Petitioners claim that DELCOR's action is barred by laches considering
that the petitioners have remained in the actual, open, uninterrupted
and adverse possession thereof until at present (Rollo, p. 17).
An instrument notarized by a notary public as in the case at bar is a
public instrument (Eacnio v. Baens, 5 Phil. 742). The execution of a
public instrument is equivalent to the delivery of the thing (Art. 1498,
1st Par., Civil Code) and is deemed legal delivery. Hence, its execution
was considered a sufficient delivery of the property (Buencamino v.
Viceo, 13 Phil. 97; [1906]; Puato v. Mendoza, 64 Phil. 457 [1937]; Vda.
de Sarmiento v. Lesaca, 108 Phil. 900 [1960]; Phil. Suburban
Development Corp. v. Auditor Gen., 63 SCRA 397 (1975]).
Besides, the property sold is a registered land. It is the act of
registration that transfers the ownership of the land sold. (GSIS v.
C.A., G.R. No. 42278, January 20, 1989). If the property is a registered
land, the purchaser in good, faith has a right to rely on the certificate

of title and is under no duty to go behind it to look for flaws (Mallorca


v. De Ocampo, No. L-26852, March 25, 1970; Unchuan v. C.A., 161
SCRA 710 [1988]; Nuguid v. CA-G.R. No. 77427, March 13, 1989).
Under the established principles of land registration law, the person
dealing with registered land may generally rely on the correctness of
its certificate of title and the law will in no way oblige him to go
behind the certificate to determine the condition of the property
(Tiongco v. de la Merced, L-2446, July 25, 1974; Lopez vs. CA., G.R. No.
49739, January 20, 1989; Davao Grains Inc. vs. IAC, 171 SCRA 612
[1989]). This notwithstanding, DELCOR did more than that. It did not
only rely on the certificate of title. The Court of Appeals found that it
had first investigated and checked the title (T.C.T. No. T-1183) in the
name of Luis Lancero. It likewise inquired into the Subdivision Plan,
the corresponding technical description and the deed of sale executed
by Ricardo Gevero in favor of Luis Lancero and found everything in
order. It even went to the premises and found Luis Lancero to be in
possession of the land to the exclusion of any other person. DELCOR
had therefore acted in good faith in purchasing the land in question.
Consequently, DELCOR's action is not barred by laches.
The main issues having been disposed of, discussion of the other
issues appear unnecessary.
PREMISES CONSIDERED, the instant petition is hereby DISMISSED and
the decision of the Court of Appeals is hereby AFFIRMED.
SO ORDERED.
Melencio-Herrera (Chairman), Padilla and Regalado, JJ., concur.
Sarmiento, J., is on leave.
Footnotes
1 Penned by Justice Jose C. Campos, Jr. with the
concurrence of Justices Crisolito Pascual, Serapin
Camilon and Desiderio P. Jurado.
2 Penned by Judge Benjamin K. Gorospe.

G.R. No. 89783 February 19, 1992


MARIANO B. LOCSIN, JULIAN J. LOCSIN, JOSE B. LOCSIN, AUREA
B. LOCSIN, MATILDE L. CORDERO, SALVADOR B. LOCSIN and
MANUEL V. DEL ROSARIO,petitioners,
vs.
THE HON. COURT OF APPEALS, JOSE JAUCIAN, FLORENTINO
JAUCIAN, MERCEDES JAUCIAN ARBOLEDA, HEIRS OF JOSEFINA
J. BORJA, HEIRS OF EDUARDO JAUCIAN and HEIRS OF VICENTE
JAUCIAN, respondents.
Aytona Law Office and Siquia Law Offices for petitioners.
Mabella, Sangil & Associates for private respondents.
NARVASA, C.J.:

Reversal of the decision of the Court of Appeals in CA-G.R. No. CV11186 affirming with modification the judgment of the Regional
Trial Court of Albay in favor of the plaintiffs in Civil Case No. 7152
entitled "Jose Jaucian, et al. v. Mariano B. Locsin, et al.," an action for
recovery of real property with damages is sought. in these
proceedings initiated by petition for review on certiorari in accordance
with Rule 45 of the Rules of Court.
The petition was initially denied due course and dismissed by this
Court. It was however reinstated upon a second motion for
reconsideration filed by the petitioners, and the respondents were
required to comment thereon. The petition was thereafter given due
course and the parties were directed to submit their memorandums.
These, together with the evidence, having been carefully considered,
the Court now decides the case.
First, the facts as the Court sees them in light of the evidence on
record:
The late Getulio Locsin had three children named Mariano, Julian and
Magdalena, all surnamed Locsin. He owned extensive residential and
agricultural properties in the provinces of Albay and Sorsogon. After
his death, his estate was divided among his three (3) children as
follows:
(a) the coconut lands of some 700 hectares in Bual, Pilar, Sorsogon,
were adjudicated to his daughter, Magdalena Locsin;
(b) 106 hectares of coconut lands were given to Julian Locsin, father of
the petitioners Julian, Mariano, Jose, Salvador, Matilde, and Aurea, all
surnamed Locsin;
(c) more than forty (40) hectares of coconut lands in Bogtong,
eighteen (18) hectares of riceland in Daraga, and the residential lots
in Daraga, Albay and in Legazpi City went to his son Mariano, which
Mariano brought into his marriage to Catalina Jaucian in 1908.
Catalina, for her part, brought into the marriage untitled properties
which she had inherited from her parents, Balbino Jaucian and Simona
Anson. These were augmented by other properties acquired by the
spouses in the course of their union, 1 which however was not blessed
with children.
Eventually, the properties of Mariano and Catalina were brought under
the Torrens System. Those that Mariano inherited from his father,
Getulio Locsin, were surveyed cadastrally and registered in the name
of "Mariano Locsin, married to Catalina Jaucian.'' 2
Mariano Locsin executed a Last Will and Testament instituting his wife,
Catalina, as the sole and universal heir of all his properties. 3 The will
was drawn up by his wife's nephew and trusted legal adviser, Attorney

Salvador Lorayes. Attorney Lorayes disclosed that the spouses being


childless, they had agreed that their properties, after both of them
shall have died should revert to their respective sides of the
family, i.e., Mariano's properties would go to his "Locsin relatives"
(i.e., brothers and sisters or nephews and nieces), and those of
Catalina to her "Jaucian relatives." 4
Don Mariano Locsin died of cancer on September 14, 1948 after a
lingering illness. In due time, his will was probated in Special
Proceedings No. 138, CFI of Albay without any opposition from both
sides of the family. As directed in his will, Doa Catalina was
appointed executrix of his estate. Her lawyer in the probate
proceeding was Attorney Lorayes. In the inventory of her husband's
estate 5 which
she
submitted
to
the
probate
court
for
approval, 6Catalina declared that "all items mentioned from Nos. 1 to
33 are the private properties of the deceased and form part of his
capital at the time of the marriage with the surviving spouse, while
items Nos. 34 to 42 are conjugal." 7
Among her own and Don Mariano's relatives, Doa Catalina was
closest to her nephew, Attorney Salvador Lorayes, her nieces, Elena
Jaucian, Maria Lorayes-Cornelio and Maria Olbes-Velasco, and the
husbands of the last two: Hostilio Cornelio and Fernando Velasco. 8Her
trust in Hostilio Cornelio was such that she made him custodian of all
the titles of her properties; and before she disposed of any of them,
she unfailingly consulted her lawyer-nephew, Attorney Salvador
Lorayes. It was Atty. Lorayes who prepared the legal documents and,
more often than not, the witnesses to the transactions were her niece
Elena Jaucian, Maria Lorayes-Cornelio, Maria Olbes-Velasco, or their
husbands. Her niece, Elena Jaucian, was her life-long companion in
her house.
Don Mariano relied on Doa Catalina to carry out the terms of their
compact, hence, nine (9) years after his death, as if in obedience to
his voice from the grave, and fully cognizant that she was also
advancing in years, Doa Catalina began transferring, by sale,
donation or assignment, Don Mariano's as well as her own, properties
to their respective nephews and nieces. She made the following sales
and donation of properties which she had received from her husband's
estate, to his Locsin nephews and nieces:
EXHIBIT DATE PARTICULARS AREA/SQ.M. PRICE WITNESSES
23 Jan. 26, 1957 Deed of Absolute Sale in 962 P 481
favor of Mariano Locsin
1-JRL Apr. 7, 1966 Deed of Sale in favor of 430,203 P 20,000
Jose R. Locsin

10

1-JJL Mar. 22, 1967 Deed of Sale in favor of 5,000 P 1,000 Hostilio
Cornello
Julian Locsin (Lot 2020) Helen M. Jaucian
1 Nov. 29, 1974 Deed of Donation in 26,509
favor Aurea Locsin,
Matilde L. Cordero
and Salvador Locsin
2 Feb. 4, 1975 Deed of Donation in 34,045
favor Aurea Locsin,
Matilde L. Cordero
and Salvador Locsin
3 Sept. 9, 1975 Deed of Donation in (Lot 2059)
favor Aurea Locsin,
Matilde L. Cordero
and Salvador Locsin
4 July 15, 1974 Deed of Absolute Sale in 1,424 Hostilio Cornelio
favor of Aurea B. Locsin Fernando Velasco
5 July 15, 1974 Deed of Absolute Sale in 1,456 P 5,750 Hostilio
Cornelio
favor of Aurea B. Locsin Elena Jaucian
6 July 15, 1974 Deed of Absolute Sale in 1,237 P 5,720 - ditto favor of Aurea B. Locsin
7 July 15, 1974 Deed of Absolute Sale in 1,404 P 4,050 - ditto favor of Aurea B. Locsin
15 Nov. 26, 1975 Deed of Sale in favor of 261 P 4,930 - ditto Aurea Locsin
16 Oct. 17, 1975 Deed of Sale in favor of 533 P 2,000 Delfina Anson
Aurea Locsin M. Acabado
17 Nov. 26, 1975 Deed of Sale in favor of 373 P 1,000 Leonor Satuito
Aurea Locsin Mariano B. Locsin
19 Sept. 1, 1975 Conditional Donation in 1,130 P 3,000 - ditto favor of Mariano Locsin
1-MVRJ Dec. 29, 1972 Deed of Reconveyance 1,5110.66 P 1,000
Delfina Anson
in favor of Manuel V. del (Lot 2155) Antonio Illegible
Rosario whose maternal
grandfather was Getulio
Locsin
2-MVRJ June 30, 1973 Deed of Reconveyance 319.34 P 500 Antonio
Illegible
in favor of Manuel V. del (Lot 2155) Salvador Nical
Rosario but the rentals

from bigger portion of


Lot 2155 leased to Filoil
Refinery were assigned to
Maria Jaucian Lorayes
Cornelio
Of her own properties, Doa Catalina conveyed the following to her
own nephews and nieces and others:
EXHIBIT DATE PARTICULARS AREA/SQ.M. PRICE
2-JJL July 16, 1964 Deed of Sale in favor 5,000 P 1,000
Vicente Jaucian (lot 2020)
(6,825 sqm. when
resurveyed)
24 Feb. 12, 1973 Deed of Absolute Sale 100 P 1,000
in favor of Francisco M.
Maquiniana
26 July 15, 1973 Deed of Absolute Sale in 130 P 1,300
favor of Francisco
Maquiniana
27 May 3, 1973 Deed of Absolute Sale in 100 P 1,000
favor of Ireneo Mamia
28 May 3, 1973 Deed of Absolute Sale in 75 P 750
favor of Zenaida Buiza
29 May 3, 1973 Deed of Absolute Sale in 150 P 1,500
favor of Felisa Morjella
30 Apr. 3, 1973 Deed of Absolute Sale in 31 P 1,000
favor of Inocentes Motocinos
31 Feb. 12, 1973 Deed of Absolute Sale in 150 P 1,500
favor of Casimiro Mondevil
32 Mar. 1, 1973 Deed of Absolute Sale in 112 P 1,200
favor of Juan Saballa
25 Dec. 28, 1973 Deed of Absolute Sale in 250 P 2,500
of Rogelio Marticio
Doa Catalina died on July 6, 1977.
Four years before her death, she had made a will on October 22, 1973
affirming and ratifying the transfers she had made during her lifetime
in favor of her husband's, and her own, relatives. After the reading of
her will, all the relatives agreed that there was no need to submit it to
the court for probate because the properties devised to them under
the will had already been conveyed to them by the deceased when
she was still alive, except some legacies which the executor of her will
or estate, Attorney Salvador Lorayes, proceeded to distribute.

11

In 1989, or six (6) years after Doa Catalina's demise, some of her
Jaucian nephews and nieces who had already received their legacies
and hereditary shares from her estate, filed action in the Regional Trial
Court of Legaspi City (Branch VIII, Civil Case No. 7152) to recover the
properties which she had conveyed to the Locsins during her lifetime,
alleging that the conveyances were inofficious, without consideration,
and intended solely to circumvent the laws on succession. Those who
were closest to Doa Catalina did not join the action.
After the trial, judgment was rendered on July 8, l985 in favor of the
plaintiffs (Jaucian), and against the Locsin defendants, the dispositive
part of which reads:
WHEREFORE, this Court renders judgment for the plaintiffs and
against the defendants:
(1) declaring the, plaintiffs, except the heirs of Josefina J. Borja and
Eduardo Jaucian, who withdrew, the rightful heirs and entitled to the
entire estate, in equal portions, of Catalina Jaucian Vda. de Locsin,
being the nearest collateral heirs by right of representation of Juan
and Gregorio, both surnamed Jaucian, and full-blood brothers of
Catalina;
(2) declaring the deeds of sale, donations, reconveyance and
exchange and all other instruments conveying any part of the estate
of Catalina J. Vda. de Locsin including, but not limited to those in the
inventory of known properties (Annex B of the complaint) as null and
void ab-initio;
(3) ordering the Register of Deeds of Albay and/or Legazpi City to
cancel all certificates of title and other transfers of the real properties,
subject of this case, in the name of defendants, and derivatives
therefrom, and issue new ones to the plaintiffs;
(4) ordering the defendants, jointly and severally, to reconvey
ownership and possession of all such properties to the plaintiffs,
together with all muniments of title properly endorsed and delivered,
and all the fruits and incomes received by the defendants from the
estate of Catalina, with legal interest from the filing of this action; and
where reconveyance and delivery cannot be effected for reasons that
might have intervened and prevent the same, defendants shall pay
for the value of such properties, fruits and incomes received by them,
also with legal interest from the filing, of this case
(5) ordering each of the defendants to pay the plaintiffs the amount of
P30,000.00 as exemplary damages; and the further sum of
P20,000.00 each as moral damages; and

(6) ordering the defendants to pay the plaintiffs attorney's fees and
litigation expenses, in the amount of P30,000.00 without prejudice to
any contract between plaintiffs and counsel.
Costs against the defendants. 9
The Locsins appealed to the Court of Appeals (CA-G.R. No. CV-11186)
which rendered its now appealed judgment on March 14, 1989,
affirming the trial court's decision.
The petition has merit and should be granted.
The trial court and the Court of Appeals erred in declaring the private
respondents, nephews and nieces of Doa Catalina J. Vda. de Locsin,
entitled to inherit the properties which she had already disposed of
more than ten (10) years before her death. For those properties did
not form part of her hereditary estate, i.e., "the property and
transmissible rights and obligationsexisting at the time of (the
decedent's) death and those which have accrued thereto since the
opening of the succession." 10 The rights to a person's succession are
transmitted from the moment of his death, and do not vest in his heirs
until such time. 11 Property which Doa Catalina had transferred or
conveyed to other persons during her lifetime no longer formed part
of her estate at the time of her death to which her heirs may lay
claim. Had she died intestate, only the property that remained in her
estate at the time of her death devolved to her legal heirs; and even if
those transfers were, one and all, treated as donations, the right
arising under certain circumstances to impugn and compel the
reduction or revocation of a decedent's gifts inter vivos does not inure
to the respondents since neither they nor the donees are compulsory
(or forced) heirs. 12
There is thus no basis for assuming an intention on the part of Doa
Catalina, in transferring the properties she had received from her late
husband to his nephews and nieces, an intent to circumvent the law in
violation of the private respondents' rights to her succession. Said
respondents are not her compulsory heirs, and it is not pretended that
she had any such, hence there were no legitimes that could
conceivably be impaired by any transfer of her property during her
lifetime. All that the respondents had was an expectancy that in
nowise restricted her freedom to dispose of even her entire estate
subject only to the limitation set forth in Art. 750, Civil Code which,
even if it were breached, the respondents may not invoke:
Art. 750. The donation may comprehend all the present property of
the donor or part thereof, provided he reserves, in full ownership or
in usufruct, sufficient means for the support of himself, and of all
relatives who, at the time of the acceptance of the donation, are by

12

law entitled to be supported by the donor. Without such reservation,


the donation shall be reduced on petition of any person affected.
(634a)
The lower court capitalized on the fact that Doa Catalina was already
90 years old when she died on July 6, 1977. It insinuated that because
of her advanced years she may have been imposed upon, or unduly
influenced and morally pressured by her husband's nephews and
nieces (the petitioners) to transfer to them the properties which she
had inherited from Don Mariano's estate. The records do not support
that conjecture.
For as early as 1957, or twenty-eight (28) years before her death,
Doa Catalina had already begun transferring to her Locsin nephews
and nieces the properties which she received from Don Mariano. She
sold a 962-sq.m. lot on January 26, 1957 to his nephew and namesake
Mariano Locsin II. 13 On April 7, 1966, or 19 years before she passed
away, she also sold a 43 hectare land to another Locsin nephew, Jose
R. Locsin. 14 The next year, or on March 22, 1967, she sold a 5,000sq.m. portion of Lot 2020 to Julian Locsin. 15
On March 27, 1967, Lot 2020 16 was partitioned by and among Doa
Catalina, Julian Locsin, Vicente Jaucian and Agapito Lorete. 17 At least
Vicente Jaucian, among the other respondents in this case, is
estopped from assailing the genuineness and due execution of the
sale of portions of Lot 2020 to himself, Julian Locsin, and Agapito
Lorete, and the partition agreement that he (Vicente) concluded with
the other co-owners of Lot 2020.
Among Doa, Catalina's last transactions before she died in 1977
were the sales of property which she made in favor of Aurea Locsin
and Mariano Locsin in 1975. 18
There is not the slightest suggestion in the record that Doa Catalina
was mentally incompetent when she made those dispositions. Indeed,
how can any such suggestion be made in light of the fact that even as
she was transferring properties to the Locsins, she was also
contemporaneously disposing of her other properties in favor of the
Jaucians? She sold to her nephew, Vicente Jaucian, on July 16, 1964
(21 years before her death) one-half (or 5,000 sq.m.) of Lot 2020.
Three years later, or on March 22, 1967, she sold another 5000 sq.m.
of the same lot to Julian Locsin. 19
From 1972 to 1973 she made several other transfers of her properties
to her relatives and other persons, namely: Francisco Maquiniana,
Ireneo Mamia, Zenaida Buiza, Feliza Morjella, Inocentes Motocinos,
Casimiro Mondevil, Juan Saballa and Rogelio Marticio. 20 None of those
transactions was impugned by the private respondents.

In 1975, or two years before her death, Doa Catalina sold some lots
not only to Don Mariano's niece, Aurea Locsin, and his nephew,
Mariano
Locsin
II, 21 but also to her niece, Mercedes Jaucian Arboleda. 22 If she was
competent to make that conveyance to Mercedes, how can there be
any doubt that she was equally competent to transfer her other
pieces of property to Aurea and Mariano II?
The trial court's belief that Don Mariano Locsin bequeathed his entire
estate to his wife, from a "consciousness of its real origin" which
carries the implication that said estate consisted of properties which
his wife had inherited from her parents, flies in the teeth of Doa
Catalina's admission in her inventory of that estate, that "items 1 to
33 are the private properties of the deceased (Don Mariano) and
forms (sic) part of his capital at the time of the marriage with the
surviving spouse, while items 34 to 42 are conjugal properties,
acquired during the marriage." She would have known better than
anyone else whether the listing included any of her paraphernal
property so it is safe to assume that none was in fact included. The
inventory was signed by her under oath, and was approved by the
probate court in Special Proceeding No. 138 of the Court of First
Instance of Albay. It was prepared with the assistance of her own
nephew and counsel, Atty. Salvador Lorayes, who surely would not
have prepared a false inventory that would have been prejudicial to
his aunt's interest and to his own, since he stood to inherit from her
eventually.
This Court finds no reason to disbelieve Attorney Lorayes' testimony
that before Don Mariano died, he and his wife (Doa Catalina), being
childless, had agreed that their respective properties should
eventually revert to their respective lineal relatives. As the trusted
legal adviser of the spouses and a full-blood nephew of Doa Catalina,
he would not have spun a tale out of thin air that would also prejudice
his own interest.
Little significance, it seems, has been attached to the fact that among
Doa Catalina's nephews and nieces, those closest to her: (a) her
lawyer-nephew Attorney Salvador Lorayes; (b) her niece and
companion Elena Jaucian: (c) her nieces Maria Olbes-Velasco and
Maria Lorayes-Cornelio and their respective husbands, Fernando
Velasco and Hostilio Cornelio, did not join the suit to annul and
undo the dispositions of property which she made in favor of the
Locsins, although it would have been to their advantage to do so.
Their desistance persuasively demonstrates that Doa Catalina acted
as a completely free agent when she made the conveyances in favor

13

of the petitioners. In fact, considering their closeness to Doa Catalina


it would have been well-nigh impossible for the petitioners to employ
"fraud, undue pressure, and subtle manipulations" on her to make her
sell or donate her properties to them. Doa Catalina's niece, Elena
Jaucian, daughter of her brother, Eduardo Jaucian, lived with her in her
house. Her nephew-in-law, Hostilio Cornelio, was the custodian of the
titles of her properties. The sales and donations which she signed in
favor of the petitioners were prepared by her trusted legal adviser and
nephew, Attorney Salvador Lorayes. The (1) deed of donation dated
November
19,
1974 23 in favor of Aurea Locsin, (2) another deed of donation dated
February 4, 1975 24 in favor of Matilde Cordero, and (3) still another
deed dated September 9, 1975 25 in favor of Salvador Lorayes, were
all witnessed by Hostilio Cornelio (who is married to Doa Catalina's
niece, Maria Lorayes) and Fernando Velasco who is married to another
niece, Maria Olbes.26 The sales which she made in favor of Aurea
Locsin on July 15, 1974 27 were witnessed by Hostilio Cornelio and
Elena Jaucian. Given those circumstances, said transactions could not
have been anything but free and voluntary acts on her part.
Apart from the foregoing considerations, the trial court and the Court
of Appeals erred in not dismissing this action for annulment and
reconveyance on the ground of prescription. Commenced decades
after the transactions had been consummated, and six (6) years after
Doa Catalina's death, it prescribed four (4) years after the subject
transactions were recorded in the Registry of Property, 28 whether
considered an action based on fraud, or one to redress an injury to the
rights of the plaintiffs. The private respondents may not feign
ignorance of said transactions because the registration of the deeds
was constructive notice thereof to them and the whole world. 29
WHEREFORE, the petition for review is granted. The decision dated
March 14, 1989 of the Court of Appeals in CA-G.R. CV No. 11186 is
REVERSED and SET ASIDE. The private respondents' complaint for
annulment of contracts and reconveyance of properties in Civil Case
No. 7152 of the Regional Trial Court, Branch VIII of Legazpi City, is
DISMISSED, with costs against the private respondents, plaintiffs
therein.
SO ORDERED.
Cruz, Grio-Aquino and Medialdea, JJ., concur.

[G.R. No. 125835. July 30, 1998]


NATALIA CARPENA OPULENCIA, petitioner, vs. COURT OF
APPEALS, ALADIN SIMUNDAC and MIGUEL
OLIVAN, respondents.
DECISION
PANGANIBAN, J.
Is a contract to sell a real property involved in testate
proceedings valid and binding without the approval of the probate
court?
Statement of the Case
This is the main question raised in this petition for review before
us, assailing the Decision[1] of the Court of Appeals[2] in CA-GR CV No.
41994 promulgated on February 6, 1996 and its Resolution [3] dated
July 19, 1996. The challenged Decision disposed as follows:
WHEREFORE, premises considered, the order of the lower court
dismissing the complaint is SET ASIDE and judgment is hereby
rendered declaring the CONTRACT TO SELL executed by appellee in
favor of appellants as valid and binding, subject to the result of the
administration proceedings of the testate Estate of Demetrio Carpena.
SO ORDERED. [4]
Petitioners Motion for Reconsideration was denied in the
challenged Resolution.[5]
The Facts

Footnotes

14

The antecedent facts, as succinctly narrated by Respondent Court


of Appeals are:
In a complaint for specific performance filed with the court a quo
[herein private respondents] Aladin Simundac and Miguel Oliven
alleged that [herein petitioner] Natalia Carpena Opulencia executed in
their favor a CONTRACT TO SELL Lot 2125 of the Sta. Rosa Estate,
consisting of 23,766 square meters located in Sta. Rosa, Laguna
at P150.00 per square meter; that plaintiffs paid a downpayment
of P300,000.00 but defendant, despite demands, failed to comply with
her obligations under the contract. [Private respondents] therefore
prayed that [petitioner] be ordered to perform her contractual
obligations and to further pay damages, attorneys fee and litigation
expenses.
In her traverse, [petitioner] admitted the execution of the contract in
favor
of
plaintiffs
and
receipt
of P300,000.00
as
downpayment. However, she put forward the following affirmative
defenses: that the property subject of the contract formed part of the
Estate of Demetrio Carpena (petitioners father), in respect of which a
petition for probate was filed with the Regional Trial Court, Branch 24,
Bian, Laguna; that at the time the contract was executed, the parties
were aware of the pendency of the probate proceeding; that the
contract to sell was not approved by the probate court; that realizing
the nullity of the contract [petitioner] had offered to return the
downpayment received from [private respondents], but the latter
refused to accept it; that [private respondents] further failed to
provide funds for the tenant who demanded P150,00.00 in payment of
his tenancy rights on the land; that [petitioner] had chosen to rescind
the contract.
At the pre-trial conference the parties stipulated on [sic] the following
facts:
1. That on February 3, 1989, [private respondents] and [petitioner]
entered into a contract to sell involving a parcel of land situated in
Sta. Rosa, Laguna, otherwise known as Lot No. 2125 of the Sta. Rosa
Estate.
2. That the price or consideration of the said sell [sic] is P150.00 per
square meters;
3. That the amount of P300,000.00 had already been received by
[petitioner];
4. That the parties have knowledge that the property subject of the
contract to sell is subject of the probate proceedings;

5. That [as] of this time, the probate Court has not yet issued an order
either approving or denying the said sale. (p. 3, appealed Order of
September 15, 1992, pp. 109-112, record).
[Private respondents] submitted their evidence in support of the
material allegations of the complaint. In addition to testimonies of
witnesses, [private respondents] presented the following documentary
evidences: (1) Contract to Sell (Exh A); (2) machine copy of the last
will and testament of Demetrio Carpena (defendants father) to show
that the property sold by defendant was one of those devised to her in
said will (Exh B); (3) receipts signed by defendant for the
downpayment in the total amount of P300,000.00 (Exhs C, D & E);
and (4) demand letters sent to defendant (Exhs F & G).
It appears that [petitioner], instead of submitting her evidence, filed a
Demurrer to Evidence. In essence, defendant maintained that the
contract to sell was null and void for want of approval by the probate
court. She further argued that the contract was subject to a
suspensive condition, which was the probate of the will of defendants
father Demetrio Carpena. An Opposition was filed by [private
respondents]. It appears further that in an Order dated December 15,
1992 the court a quo granted the demurrer to evidence and dismissed
the complaint. It justified its action in dismissing the complaint in the
following manner:
It is noteworthy that when the contract to sell was consummated, no
petition was filed in the Court with notice to the heirs of the time and
place of hearing, to show that the sale is necessary and beneficial. A
sale of properties of an estate as beneficial to the interested parties
must comply with the requisites provided by law, (Sec. 7, Rule 89,
Rules of Court) which are mandatory, and without them, the authority
to sell, the sale itself, and the order approving it, would be null and
void ab initio. (Arcilla vs. David, 77 Phil. 718, Gabriel, et al., vs.
Encarnacion, et al., L-6736, May 4, 1954; Bonaga vs. Soler, 2 Phil.
755) Besides, it is axiomatic that where the estate of a deceased
person is already the subject of a testate or intestate proceeding, the
administrator cannot enter into any transaction involving it without
prior approval of the probate Court. (Estate of Obave, vs. Reyes, 123
SCRA 767).
As held by the Supreme Court, a decedents representative
(administrator) is not estopped from questioning the validity of his
own void deed purporting to convey land. (Bona vs. Soler, 2 Phil,
755). In the case at bar, the [petitioner,] realizing the illegality of the
transaction[,] has interposed the nullity of the contract as her
defense, there being no approval from the probate Court, and, in good

15

faith offers to return the money she received from the [private
respondents]. Certainly, the administratrix is not estop[ped] from
doing so and the action to declare the inexistence of contracts do not
prescribe. This is what precipitated the filing of [petitioners] demurrer
to evidence.[6]
The trial courts order of dismissal was elevated to the Court of
Appeals by private respondents who alleged:
1. The lower court erred in concluding that the contract to sell is null
and void, there being no approval of the probate court.
2. The lower court erred in concluding that [petitioner] in good faith
offers to return the money to [private respondents].
3. The lower court erred in concluding that [petitioner] is not under
estoppel to question the validity of the contract to sell.
4. The lower court erred in not ruling on the consideration of the
contract to sell which is tantamount to plain unjust enrichment of
[petitioner] at the expense of [private respondents].[7]
Public Respondents Ruling
Declaring the Contract to Sell valid, subject to the outcome of the
testate proceedings on Demetrio Carpenas estate, the appellate court
set aside the trial courts dismissal of the complaint and correctly ruled
as follows:
It is apparent from the appealed order that the lower court treated the
contract to sell executed by appellee as one made by the
administratrix of the Estate of Demetrio Carpena for the benefit of the
estate. Hence, its main reason for voiding the contract in question
was the absence of the probate courts approval. Presumably, what the
lower court had in mind was the sale of the estate or part thereof
made by the administrator for the benefit of the estate, as authorized
under Rule 89 of the Revised Rules of Court, which requires the
approval of the probate court upon application therefor with notice to
the heirs, devisees and legatees.
However, as adverted to by appellants in their brief, the contract to
sell in question is not covered by Rule 89 of the Revised Rules of Court
since it was made by appellee in her capacity as an heir, of a property
that was devised to her under the will sought to be probated. Thus,
while the document inadvertently stated that appellee executed the
contract in her capacity as executrix and administratrix of the estate,
a cursory reading of the entire text of the contract would unerringly
show that what she undertook to sell to appellants was one of the
other properties given to her by her late father, and more importantly,
it was not made for the benefit of the estate but for her own needs. To

illustrate this point, it is apropos to refer to the preambular or


preliminary portion of the document, which reads:
WHEREAS, the SELLER is the lawful owner of a certain parcel of land,
which is more particularly described as follows:
xxxxxxxxx
xxxxxxxxx
xxxxxxxxx
WHEREAS, the SELLER suffers difficulties in her living and has forced
to offer the sale of the above-described property, which property was
only one among the other properties given to her by her late father, to
anyone who can wait for complete clearance of the court on the Last
Will Testament of her father.
WHEREAS, the SELLER in order to meet her need of cash, has offered
for sale the said property at ONE HUNDRED FIFTY PESOS (150.00)
Philippine Currency, per square meter unto the BUYERS, and with this
offer, the latter has accepted to buy and/or purchase the same, less
the area for the road and other easements indicated at the back of
Transfer Certificate of Title No. 2125 duly confirmed after the survey
to be conducted by the BUYERs Licensed Geodetic Engineer, and
whatever area [is] left. (Emphasis added).
To emphasize, it is evident from the foregoing clauses of the contract
that appellee sold Lot 2125 not in her capacity as executrix of the will
or administratrix of the estate of her father, but as an heir and more
importantly as owner of said lot which, along with other properties,
was devised to her under the will sought to be probated. That being
so, the requisites stipulated in Rule 89 of the Revised Rules of Court
which refer to a sale made by the administrator for the benefit of the
estate do not apply.
xxxxxxxxx
It is noteworthy that in a Manifestation filed with this court by
appellants, which is not controverted by appellee, it is mentioned that
the last will and testament of Demetrio Carpena was approved in a
final judgment rendered in Special Proceeding No. B-979 by the
Regional Trial Court, Branch 24 Binan, Laguna. But of course such
approval does not terminate the proceeding[s] since the settlement of
the estate will ensue. Such proceedings will consist, among others, in
the issuance by the court of a notice to creditors (Rule 86), hearing of
money claims and payment of taxes and estate debts (Rule 88) and
distribution of the residue to the heirs or persons entitled thereto
(Rule 90). In effect, the final execution of the deed of sale itself upon
appellants payment of the balance of the purchase price will have to
wait for the settlement or termination of the administration

16

proceedings of the Estate of Demetrio Carpena. Under the foregoing


premises, what the trial court should have done with the complaint
was not to dismiss it but to simply put on hold further proceedings
until such time that the estate or its residue will be distributed in
accordance with the approved will.
The rule is that when a demurrer to the evidence is granted by the
trial court but reversed on appeal, defendant loses the right to adduce
his evidence. In such a case, the appellate court will decide the
controversy on the basis of plaintiffs evidence. In the case at bench,
while we find the contract to sell valid and binding between the
parties, we cannot as yet order appellee to perform her obligations
under the contract because the result of the administration
proceedings of the testate Estate of Demetrio Carpena has to be
awaited. Hence, we shall confine our adjudication to merely declaring
the validity of the questioned Contract to Sell.
Hence, this appeal.[8]

Insisting that the above rule should apply to this case, petitioner
argues that the stipulations in the Contract to Sell require her to act in
her capacity as an executrix or administratrix. She avers that her
obligation to eject tenants pertains to the administratrix or executrix,
the estate being the landlord of the said tenants.[10] Likewise
demonstrating that she entered into the contract in her capacity as
executor is the stipulation that she must effect the conversion of
subject land from irrigated rice land to residential land and secure the
necessary clearances from government offices. Petitioner alleges that
these obligations can be undertaken only by an executor or
administrator of an estate, and not by an heir.[11]
The Court is not persuaded. As correctly ruled by the Court of
Appeals, Section 7 of Rule 89 of the Rules of Court is not applicable,
because petitioner entered into the Contract to Sell in her capacity as
an heiress, not as an executrix or administratrix of the estate. In the
contract, she represented herself as the lawful owner and seller of the
subject parcel of land.[12] She also explained the reason for the sale to
be difficulties in her living conditions and consequent need of cash.
[13]
These representations clearly evince that she was not acting on
behalf of the estate under probate when she entered into the Contract
to Sell. Accordingly, the jurisprudence cited by petitioner has no
application to the instant case.
We emphasize that hereditary rights are vested in the heir or
heirs from the moment of the decedents death. [14] Petitioner,
therefore, became the owner of her hereditary share the moment her
father died. Thus, the lack of judicial approval does not invalidate the
Contract to Sell, because the petitioner has the substantive right to
sell the whole or a part of her share in the estate of her late father.
[15]
Thus, in Jakosalem vs. Rafols,[16] the Court resolved an identical
issue under the old Civil Code and held:
Article 440 of the Civil Code provides that the possession of hereditary
property is deemed to be transmitted to the heir without interruption
from the instant of the death of the decedent, in case the inheritance
be accepted. And Manresa with reason states that upon the death of a
person, each of his heirs becomes the undivided owner of the whole
estate left with respect to the part or portion which might be
adjudicated to him, a community of ownership being thus formed
among the coowners of the estate while it remains undivided. xxx And
according to article 399 of the Civil Code, every part owner may
assign or mortgage his part in the common property, and the effect of
such assignment or mortgage shall be limited to the portion which
may be allotted him in the partition upon the dissolution of the

The Issue
Petitioner raises only one issue:
Whether or not the Contract to Sell dated 03 February 1989
executed by the [p]etitioner and [p]rivate [r]espondent[s] without
the requisite probate court approval is valid.
The Courts Ruling
The petition has no merit.
Contract to Sell Valid
In a nutshell, petitioner contends that where the estate of the
deceased person is already the subject of a testate or intestate
proceeding, the administrator cannot enter into any transaction
involving it without prior approval of the Probate Court. [9] She
maintains that the Contract to Sell is void because it was not
approved by the probate court, as required by Section 7, Rule 89 of
the Rules of Court:
SEC. 7. Regulations for granting authority to sell, mortgage, or
otherwise encumber estate. The court having jurisdiction of the estate
of the deceased may authorize the executor or administrator to sell,
mortgage, or otherwise encumber real estate, in cases provided by
these rules and when it appears necessary or beneficial, under the
following regulations:
xxx

17

community. Hence, where some of the heirs, without the concurrence


of the others, sold a property left by their deceased father, this Court,
speaking thru its then Chief Justice Cayetano Arellano, said that the
sale was valid, but that the effect thereof was limited to the share
which may be allotted to the vendors upon the partition of the estate.
Administration of the Estate Not Prejudiced by the Contract to
Sell
Petitioner further contends that [t]o sanction the sale at this
stage would bring about a partial distribution of the decedents estate
pending the final termination of the testate proceedings. [17] This
becomes all the more significant in the light of the trial courts finding,
as stated in its Order dated August 20, 1997, that the legitime of one
of the heirs has been impaired.[18]
Petitioners contention is not convincing. The Contract to Sell
stipulates that petitioners offer to sell is contingent on the complete
clearance of the court on the Last Will Testament of her father.
[19]
Consequently, although the Contract to Sell was perfected between
the petitioner and private respondents during the pendency of the
probate proceedings, the consummation of the sale or the transfer of
ownership over the parcel of land to the private respondents is
subject to the full payment of the purchase price and to the
termination and outcome of the testate proceedings. Therefore, there
is no basis for petitioners apprehension that the Contract to Sell may
result in a premature partition and distribution of the properties of the
estate. Indeed, it is settled that the sale made by an heir of his share
in an inheritance, subject to the pending administration, in no wise
stands in the way of such administration.[20]
Estoppel
Finally, petitioner is estopped from backing out of her
representations in her valid Contract to Sell with private respondents,
from whom she had already received P300,000 as initial payment of
the purchase price. Petitioner may not renege on her own acts and
representations, to the prejudice of the private respondents who have
relied on them.[21] Jurisprudence teaches us that neither the law nor
the courts will extricate a party from an unwise or undesirable
contract he or she entered into with all the required formalities and
with full awareness of its consequences.[22]
WHEREFORE, the petition is hereby DENIED and the assailed
Decision of the Court of Appeals AFFIRMED. Costs against petitioner.
SO ORDERED.
Davide, Jr., (Chairman), Bellosillo, Vitug, and Quisumbing,
JJ., concur.

Rollo, pp. 21-27.


Sixteenth Division composed of J. Godardo A. Jacinto, ponente; with
the concurrence of J. Salome A. Montoya, chairman;
and J. Oswaldo D. Agcaoili, member.
[3]
Rollo, p. 29.
[4]
Decision, p. 8; Rollo, p. 27.
[5]
Rollo, p. 29.
[6]
Decision of the Court of Appeals, pp. 1-3; Rollo, pp. 21-23.
[7]
Appellants Brief before the Court of Appeals, p. 1.
[8]
The case was deemed submitted for resolution on December 1,
1997 when the Court received Petitioners Memorandum.
[9]
Memorandum for the Petitioner, p. 7; Rollo, p. 81.
[10]
Petitioners Memorandum, pp. 5-6; Rollo, pp. 79-80.
[11]
Ibid., p. 6; Rollo, p. 80.
[12]
Contract to Sell, p. 1; record, p. 5.
[13]
Ibid.
[14]
Art. 777, Civil Code, provides:
The rights to the succession are transmitted from the moment of the
death of the decedent.
[15]
Go Ong vs. Court of Appeals, 154 SCRA 270, 276-277, September
24, 1987; and De Borja vs. Vda. de de Borja, 46 SCRA 577,
589, August 18, 1972.
[16]
73 Phil. 628-629 (1942), per Moran, J.
[17]
Petitioners Memorandum, p. 7; Rollo, p. 81.
[18]
Ibid.
[19]
Record, p. 5.
[20]
Go Ong vs. Court of Appeals, per Paras, J., supra, p. 277; citing
Jakosalem vs. Rafols, 73 Phil 628 (1942).
[21]
Laureano Investment and Development Corporation vs. Court of
Appeals, 272 SCRA 253, 263, May 6, 1997; citing Caltex
(Philippines), Inc. vs. Court of Appeals, 212 SCRA 448, 457,
August 10, 1992.
[22]
Esguerra vs. Court of Appeals, 267 SCRA 380, 393, February 3,
1997, citing Republic vs. Sandiganbayan, 226 SCRA 314,
September 10, 1993.
FIRST DIVISI ON
[1]
[2]

18

[G.R. No. 126334. November 23, 2001]


EMILIO EMNACE, petitioner, vs. COURT OF APPEALS, ESTATE
OF VICENTE TABANAO, SHERWIN TABANAO, VICENTE
WILLIAM TABANAO, JANETTE TABANAO DEPOSOY,
VICENTA MAY TABANAO VARELA, ROSELA TABANAO and
VINCENT TABANAO, respondents.
DECISION
YNARES-SANTIAGO, J.:
Petitioner Emilio Emnace, Vicente Tabanao and Jacinto
Divinagracia were partners in a business concern known as Ma. Nelma
Fishing Industry. Sometime in January of 1986, they decided to
dissolve their partnership and executed an agreement of partition and
distribution of the partnership properties among them, consequent to
Jacinto Divinagracias withdrawal from the partnership.[1] Among the
assets to be distributed were five (5) fishing boats, six (6) vehicles,
two (2) parcels of land located at Sto. Nio and Talisay, Negros
Occidental, and cash deposits in the local branches of the Bank of the
Philippine Islands and Prudential Bank.
Throughout the existence of the partnership, and even after
Vicente Tabanaos untimely demise in 1994, petitioner failed to submit
to Tabanaos heirs any statement of assets and liabilities of the
partnership, and to render an accounting of the partnerships
finances. Petitioner also reneged on his promise to turn over to
Tabanaos heirs the deceaseds 1/3 share in the total assets of the
partnership, amounting to P30,000,000.00, or the sum of
P10,000,000.00, despite formal demand for payment thereof.[2]
Consequently, Tabanaos heirs, respondents herein, filed against
petitioner an action for accounting, payment of shares, division of
assets and damages.[3] In their complaint, respondents prayed as
follows:
1. Defendant be ordered to render the proper accounting of all the
assets and liabilities of the partnership at bar; and
2. After due notice and hearing defendant be ordered to
pay/remit/deliver/surrender/yield to the plaintiffs the following:
A. No less than One Third (1/3) of the assets, properties, dividends,
cash, land(s), fishing vessels, trucks, motor vehicles, and other forms
and substance of treasures which belong and/or should belong, had
accrued and/or must accrue to the partnership;
B. No less than Two Hundred Thousand Pesos (P200,000.00) as moral
damages;

19

C. Attorneys fees equivalent to Thirty Percent (30%) of the entire


share/amount/award which the Honorable Court may resolve the
plaintiffs as entitled to plus P1,000.00 for every appearance in court.[4]
Petitioner filed a motion to dismiss the complaint on the grounds
of improper venue, lack of jurisdiction over the nature of the action or
suit, and lack of capacity of the estate of Tabanao to sue. [5] On August
30, 1994, the trial court denied the motion to dismiss. It held that
venue was properly laid because, while realties were involved, the
action was directed against a particular person on the basis of his
personal liability; hence, the action is not only a personal action but
also an action in personam. As regards petitioners argument of lack of
jurisdiction over the action because the prescribed docket fee was not
paid considering the huge amount involved in the claim, the trial court
noted that a request for accounting was made in order that the exact
value of the partnership may be ascertained and, thus, the correct
docket fee may be paid. Finally, the trial court held that the heirs of
Tabanao had a right to sue in their own names, in view of the
provision of Article 777 of the Civil Code, which states that the rights
to the succession are transmitted from the moment of the death of
the decedent.[6]
The following day, respondents filed an amended complaint,
[7]
incorporating the additional prayer that petitioner be ordered to sell
all
(the
partnerships)
assets
and
thereafter
pay/remit/deliver/surrender/yield to the plaintiffs their corresponding
share in the proceeds thereof. In due time, petitioner filed a
manifestation and motion to dismiss,[8] arguing that the trial court did
not acquire jurisdiction over the case due to the plaintiffs failure to
pay the proper docket fees. Further, in a supplement to his motion to
dismiss,[9] petitioner also raised prescription as an additional ground
warranting the outright dismissal of the complaint.
On June 15, 1995, the trial court issued an Order, [10] denying the
motion to dismiss inasmuch as the grounds raised therein were
basically the same as the earlier motion to dismiss which has been
denied. Anent the issue of prescription, the trial court ruled that
prescription begins to run only upon the dissolution of the partnership
when the final accounting is done. Hence, prescription has not set in
the absence of a final accounting. Moreover, an action based on a
written contract prescribes in ten years from the time the right of
action accrues.
Petitioner filed a petition for certiorari before the Court of
Appeals,[11] raising the following issues:

I. Whether or not respondent Judge acted without jurisdiction


or with grave abuse of discretion in taking cognizance of a
case despite the failure to pay the required docket fee;
II. Whether or not respondent Judge acted without jurisdiction
or with grave abuse of discretion in insisting to try the
case which involve (sic) a parcel of land situated outside
of its territorial jurisdiction;
III. Whether or not respondent Judge acted without
jurisdiction or with grave abuse of discretion in allowing
the estate of the deceased to appear as party plaintiff,
when there is no intestate case and filed by one who was
never appointed by the court as administratrix of the
estates; and
IV. Whether or not respondent Judge acted without
jurisdiction or with grave abuse of discretion in not
dismissing the case on the ground of prescription.
On August 8, 1996, the Court of Appeals rendered the assailed
decision,[12] dismissing the petition for certiorari, upon a finding that
no grave abuse of discretion amounting to lack or excess of
jurisdiction was committed by the trial court in issuing the questioned
orders denying petitioners motions to dismiss.
Not satisfied, petitioner filed the instant petition for review,
raising the same issues resolved by the Court of Appeals, namely:
I. Failure to pay the proper docket fee;
II. Parcel of land subject of the case pending before the trial
court is outside the said courts territorial jurisdiction;
III. Lack of capacity to sue on the part of plaintiff heirs of
Vicente Tabanao; and
IV. Prescription of the plaintiff heirs cause of action.
It can be readily seen that respondents primary and ultimate
objective in instituting the action below was to recover the decedents
1/3 share in the partnerships assets. While they ask for an accounting
of the partnerships assets and finances, what they are actually asking
is for the trial court to compel petitioner to pay and turn over their
share, or the equivalent value thereof, from the proceeds of the sale
of the partnership assets. They also assert that until and unless a
proper accounting is done, the exact value of the partnerships assets,
as well as their corresponding share therein, cannot be
ascertained. Consequently, they feel justified in not having paid the
commensurate docket fee as required by the Rules of Court.
We do not agree. The trial court does not have to employ
guesswork in ascertaining the estimated value of the partnerships

20

assets, for respondents themselves voluntarily pegged the worth


thereof at Thirty Million Pesos (P30,000,000.00). Hence, this case is
one which is really not beyond pecuniary estimation, but rather
partakes of the nature of a simple collection case where the value of
the subject assets or amount demanded is pecuniarily determinable.
[13]
While it is true that the exact value of the partnerships total assets
cannot be shown with certainty at the time of filing, respondents can
and must ascertain, through informed and practical estimation, the
amount they expect to collect from the partnership, particularly from
petitioner, in order to determine the proper amount of docket and
other fees.[14] It is thus imperative for respondents to pay the
corresponding docket fees in order that the trial court may acquire
jurisdiction over the action.[15]
Nevertheless, unlike in the case of Manchester Development
Corp. v. Court of Appeals,[16] where there was clearly an effort to
defraud the government in avoiding to pay the correct docket fees, we
see no attempt to cheat the courts on the part of respondents. In fact,
the lower courts have noted their expressed desire to remit to the
court any payable balance or lien on whatever award which the
Honorable Court may grant them in this case should there be any
deficiency in the payment of the docket fees to be computed by the
Clerk of Court.[17] There is evident willingness to pay, and the fact that
the docket fee paid so far is inadequate is not an indication that they
are trying to avoid paying the required amount, but may simply be
due to an inability to pay at the time of filing. This consideration may
have moved the trial court and the Court of Appeals to declare that
the unpaid docket fees shall be considered a lien on the judgment
award.
Petitioner, however, argues that the trial court and the Court of
Appeals erred in condoning the non-payment of the proper legal fees
and in allowing the same to become a lien on the monetary or
property
judgment
that may
be rendered
in favor
of
respondents. There is merit in petitioners assertion. The third
paragraph of Section 16, Rule 141 of the Rules of Court states that:
The legal fees shall be a lien on the monetary or property judgment in
favor of the pauper-litigant.
Respondents cannot invoke the above provision in their favor
because it specifically applies to pauper-litigants. Nowhere in the
records does it appear that respondents are litigating as paupers, and
as such are exempted from the payment of court fees.[18]
The rule applicable to the case at bar is Section 5(a) of Rule 141
of the Rules of Court, which defines the two kinds of claims as: (1)

those which are immediately ascertainable; and (2) those which


cannot be immediately ascertained as to the exact amount. This
second class of claims, where the exact amount still has to be finally
determined by the courts based on evidence presented, falls squarely
under the third paragraph of said Section 5(a), which provides:
In case the value of the property or estate or the sum claimed is less
or more in accordance with the appraisal of the court, the difference
of fee shall be refunded or paid as the case may be. (Underscoring
ours)
In Pilipinas Shell Petroleum Corporation v. Court of Appeals,[19] this
Court pronounced that the above-quoted provision clearly
contemplates an initial payment of the filing fees corresponding to the
estimated amount of the claim subject to adjustment as to what later
may be proved.[20] Moreover, we reiterated therein the principle that
the payment of filing fees cannot be made contingent or dependent
on the result of the case. Thus, an initial payment of the docket fees
based on an estimated amount must be paid simultaneous with the
filing of the complaint. Otherwise, the court would stand to lose the
filing fees should the judgment later turn out to be adverse to any
claim of the respondent heirs.
The matter of payment of docket fees is not a mere
triviality. These fees are necessary to defray court expenses in the
handling of cases. Consequently, in order to avoid tremendous losses
to the judiciary, and to the government as well, the payment of docket
fees cannot be made dependent on the outcome of the case, except
when the claimant is a pauper-litigant.
Applied to the instant case, respondents have a specific claim 1/3
of the value of all the partnership assets but they did not allege a
specific amount. They did, however, estimate the partnerships total
assets to be worth Thirty Million Pesos (P30,000,000.00), in a
letter[21] addressed to petitioner. Respondents cannot now say that
they are unable to make an estimate, for the said letter and the
admissions therein form part of the records of this case. They cannot
avoid paying the initial docket fees by conveniently omitting the said
amount in their amended complaint. This estimate can be made the
basis for the initial docket fees that respondents should pay. Even if it
were later established that the amount proved was less or more than
the amount alleged or estimated, Rule 141, Section 5(a) of the Rules
of Court specifically provides that the court may refund the excess or
exact additional fees should the initial payment be insufficient. It is
clear that it is only the difference between the amount finally awarded

21

and the fees paid upon filing of this complaint that is subject to
adjustment and which may be subjected to a lien.
In the oft-quoted case of Sun Insurance Office, Ltd. v. Hon.
Maximiano Asuncion,[22] this Court held that when the specific claim
has been left for the determination by the court, the additional filing
fee therefor shall constitute a lien on the judgment and it shall be the
responsibility of the Clerk of Court or his duly authorized deputy to
enforce said lien and assess and collect the additional fee. Clearly, the
rules and jurisprudence contemplate the initial payment of filing and
docket fees based on the estimated claims of the plaintiff, and it is
only when there is a deficiency that a lien may be constituted on the
judgment award until such additional fee is collected.
Based on the foregoing, the trial court erred in not dismissing the
complaint outright despite their failure to pay the proper docket
fees. Nevertheless, as in other procedural rules, it may be liberally
construed in certain cases if only to secure a just and speedy
disposition of an action. While the rule is that the payment of the
docket fee in the proper amount should be adhered to, there are
certain exceptions which must be strictly construed.[23]
In recent rulings, this Court has relaxed the strict adherence to
the Manchester doctrine, allowing the plaintiff to pay the proper
docket fees within a reasonable time before the expiration of the
applicable prescriptive or reglementary period.[24]
In the recent case of National Steel Corp. v. Court of Appeals,
[25]
this Court held that:
The court acquires jurisdiction over the action if the filing of the
initiatory pleading is accompanied by the payment of the requisite
fees, or, if the fees are not paid at the time of the filing of the
pleading, as of the time of full payment of the fees within such
reasonable time as the court may grant, unless, of course,
prescription has set in the meantime.
It does not follow, however, that the trial court should have dismissed
the complaint for failure of private respondent to pay the correct
amount of docket fees. Although the payment of the proper docket
fees is a jurisdictional requirement, the trial court may allow the
plaintiff in an action to pay the same within a reasonable time before
the expiration of the applicable prescriptive or reglementary period. If
the plaintiff fails to comply within this requirement, the defendant
should timely raise the issue of jurisdiction or else he would be
considered in estoppel. In the latter case, the balance between the
appropriate docket fees and the amount actually paid by the plaintiff

will be considered a lien or any award he may obtain in his


favor. (Underscoring ours)
Accordingly, the trial court in the case at bar should determine
the proper docket fee based on the estimated amount that
respondents seek to collect from petitioner, and direct them to pay
the same within a reasonable time, provided the applicable
prescriptive or reglementary period has not yet expired. Failure to
comply therewith, and upon motion by petitioner, the immediate
dismissal of the complaint shall issue on jurisdictional grounds.
On the matter of improper venue, we find no error on the part of
the trial court and the Court of Appeals in holding that the case below
is a personal action which, under the Rules, may be commenced and
tried where the defendant resides or may be found, or where the
plaintiffs reside, at the election of the latter.[26]
Petitioner, however, insists that venue was improperly laid since
the action is a real action involving a parcel of land that is located
outside the territorial jurisdiction of the court a quo. This contention is
not well-taken. The records indubitably show that respondents are
asking that the assets of the partnership be accounted for, sold and
distributed according to the agreement of the partners. The fact that
two of the assets of the partnership are parcels of land does not
materially change the nature of the action. It is an action in
personam because it is an action against a person, namely, petitioner,
on the basis of his personal liability. It is not an action in rem where
the action is against the thing itself instead of against the person.
[27]
Furthermore, there is no showing that the parcels of land involved
in this case are being disputed. In fact, it is only incidental that part of
the assets of the partnership under liquidation happen to be parcels of
land.
The time-tested case of Claridades v. Mercader, et al.,[28] settled
this issue thus:
The fact that plaintiff prays for the sale of the assets of the
partnership, including the fishpond in question, did not change the
nature or character of the action, such sale being merely a necessary
incident of the liquidation of the partnership, which should precede
and/or is part of its process of dissolution.
The action filed by respondents not only seeks redress against
petitioner. It also seeks the enforcement of, and petitioners
compliance with, the contract that the partners executed to formalize
the partnerships dissolution, as well as to implement the liquidation
and partition of the partnerships assets. Clearly, it is a personal action
that, in effect, claims a debt from petitioner and seeks the

22

performance of a personal duty on his part.[29] In fine, respondents


complaint seeking the liquidation and partition of the assets of the
partnership with damages is a personal action which may be filed in
the proper court where any of the parties reside. [30] Besides, venue
has nothing to do with jurisdiction for venue touches more upon the
substance or merits of the case.[31] As it is, venue in this case was
properly laid and the trial court correctly ruled so.
On the third issue, petitioner asserts that the surviving spouse of
Vicente Tabanao has no legal capacity to sue since she was never
appointed as administratrix or executrix of his estate. Petitioners
objection in this regard is misplaced. The surviving spouse does not
need to be appointed as executrix or administratrix of the estate
before she can file the action. She and her children are complainants
in their own right as successors of Vicente Tabanao. From the very
moment of Vicente Tabanaos death, his rights insofar as the
partnership was concerned were transmitted to his heirs, for rights to
the succession are transmitted from the moment of death of the
decedent.[32]
Whatever claims and rights Vicente Tabanao had against the
partnership and petitioner were transmitted to respondents by
operation of law, more particularly by succession, which is a mode of
acquisition by virtue of which the property, rights and obligations to
the extent of the value of the inheritance of a person are transmitted.
[33]
Moreover, respondents became owners of their respective
hereditary shares from the moment Vicente Tabanao died.[34]
A prior settlement of the estate, or even the appointment of
Salvacion Tabanao as executrix or administratrix, is not necessary for
any of the heirs to acquire legal capacity to sue. As successors who
stepped into the shoes of their decedent upon his death, they can
commence any action originally pertaining to the decedent. [35] From
the moment of his death, his rights as a partner and to demand
fulfillment of petitioners obligations as outlined in their dissolution
agreement were transmitted to respondents. They, therefore, had the
capacity to sue and seek the courts intervention to compel petitioner
to fulfill his obligations.
Finally, petitioner contends that the trial court should have
dismissed the complaint on the ground of prescription, arguing that
respondents action prescribed four (4) years after it accrued in
1986. The trial court and the Court of Appeals gave scant
consideration to petitioners hollow arguments, and rightly so.
The three (3) final stages of a partnership are: (1) dissolution; (2)
winding-up; and (3) termination.[36] The partnership, although

dissolved, continues to exist and its legal personality is retained, at


which time it completes the winding up of its affairs, including the
partitioning and distribution of the net partnership assets to the
partners.[37] For as long as the partnership exists, any of the partners
may demand an accounting of the partnerships business. Prescription
of the said right starts to run only upon the dissolution of the
partnership when the final accounting is done.[38]
Contrary to petitioners protestations that respondents right to
inquire into the business affairs of the partnership accrued in 1986,
prescribing four (4) years thereafter, prescription had not even begun
to run in the absence of a final accounting. Article 1842 of the Civil
Code provides:
The right to an account of his interest shall accrue to any partner, or
his legal representative as against the winding up partners or the
surviving partners or the person or partnership continuing the
business, at the date of dissolution, in the absence of any agreement
to the contrary.
Applied in relation to Articles 1807 and 1809, which also deal with
the duty to account, the above-cited provision states that the right to
demand an accounting accrues at the date of dissolution in the
absence of any agreement to the contrary. When a final accounting is
made, it is only then that prescription begins to run. In the case at
bar, no final accounting has been made, and that is precisely what
respondents are seeking in their action before the trial court, since
petitioner has failed or refused to render an accounting of the
partnerships business and assets. Hence, the said action is not barred
by prescription.
In fine, the trial court neither erred nor abused its discretion when
it denied petitioners motions to dismiss. Likewise, the Court of
Appeals did not commit reversible error in upholding the trial courts
orders. Precious time has been lost just to settle this preliminary
issue, with petitioner resurrecting the very same arguments from the
trial court all the way up to the Supreme Court. The litigation of the
merits and substantial issues of this controversy is now long overdue
and must proceed without further delay.
WHEREFORE, in view of all the foregoing, the instant petition is
DENIED for lack of merit, and the case is REMANDED to the Regional
Trial Court of Cadiz City, Branch 60, which is ORDERED to determine
the proper docket fee based on the estimated amount that plaintiffs
therein seek to collect, and direct said plaintiffs to pay the same
within a reasonable time, provided the applicable prescriptive or
reglementary period has not yet expired. Thereafter, the trial court is

23

ORDERED to conduct the appropriate proceedings in Civil Case No.


416-C.
Costs against petitioner.
SO ORDERED.
Davide, Jr., C.J., (Chairman), Puno, Kapunan, and Pardo,
JJ., concur.

This is a petition for review of the decision of the Court of Appeals,


[3]
dated December 23, 1993, in CA-G.R. No. CV-35555, which set aside
the decision of Branch 52 of the Regional Trial Court in Bacolod City,
and
ordered
the
defendants-appellees (including
herein
petitioner), as heirs of Dr. Jorge Rabadilla, to reconvey title over Lot
No. 1392, together with its fruits and interests, to the estate of Aleja
Belleza.
The antecedent facts are as follows:
In a Codicil appended to the Last Will and Testament of testatrix Aleja
Belleza, Dr. Jorge Rabadilla, predecessor-in-interest of the herein
petitioner, Johnny S. Rabadilla, was instituted as a devisee of 511, 855
square meters of that parcel of land surveyed as Lot No. 1392 of the
Bacolod Cadastre. The said Codicil, which was duly probated and
admitted in Special Proceedings No. 4046 before the then Court of
First Instance of Negros Occidental, contained the following
provisions:
"FIRST
I give, leave and bequeath the following property owned by me to Dr.
Jorge Rabadilla resident of 141 P. Villanueva, Pasay City:
(a) Lot No. 1392 of the Bacolod Cadastre, covered by Transfer
Certificate of Title No. RT-4002 (10942), which is registered in my
name according to the records of the Register of Deeds of Negros
Occidental.
(b) That should Jorge Rabadilla die ahead of me, the aforementioned
property and the rights which I shall set forth hereinbelow, shall be
inherited and acknowledged by the children and spouse of Jorge
Rabadilla.
xxx
FOURTH
(a)....It is also my command, in this my addition (Codicil), that should I
die and Jorge Rabadilla shall have already received the ownership of
the said Lot No. 1392 of the Bacolod Cadastre, covered by Transfer
Certificate of Title No. RT-4002 (10942), and also at the time that the
lease of Balbinito G. Guanzon of the said lot shall expire, Jorge
Rabadilla shall have the obligation until he dies, every year to give to
Maria Marlina Coscolluela y Belleza, Seventy (75) (sic) piculs of Export
sugar and Twenty Five (25) piculs of Domestic sugar, until the said
Maria Marlina Coscolluela y Belleza dies.
FIFTH
(a) Should Jorge Rabadilla die, his heir to whom he shall give Lot No.
1392 of the Bacolod Cadastre, covered by Transfer Certificate of Title
No. RT-4002 (10492), shall have the obligation to still give yearly, the

Record, pp. 30-31.


Ibid., pp. 32-33.
[3]
Civil Case No. 416-C before the RTC of Cadiz City, Branch 60.
[4]
Rollo, p. 41.
[5]
Ibid., pp. 44-47.
[6]
Id., pp. 108-112.
[7]
Appendix H, Rollo, pp. 93-100.
[8]
Appendix I, Rollo, pp. 101-104.
[9]
Appendix J, Rollo, pp. 105-107.
[10]
Appendix L, Rollo, pp. 113-115.
[11]
CA-G.R. No. 37878, Records, pp. 2-18.
[12]
Rollo, pp. 119-126.
[13]
Colarina v. Court of Appeals, 303 SCRA 647, 652-653 (1999).
[14]
Gregorio v. Angeles, 180 SCRA 490, 494-495 (1989).
[15]
Ballatan v. Court of Appeals, 304 SCRA 34, 42 (1999).
[16]
149 SCRA 562 (1987).
[17]
Opposition to Motion to Dismiss, Records, p. 60.
[18]
Pilipinas Shell Petroleum Corp. v. Court of Appeals, 171 SCRA 674,
681 (1989).
[19]
Supra.
[20]
Ibid., p. 680.
[21]
Record, p. 32.
[22]
170 SCRA 274, 285 (1989).
[23]
Colarina, Supra, p. 654.
[24]
Colarina, Supra; De Zuzuarregui v. Court of Appeals, 174 SCRA 54,
59 (1989); Pantranco North Express, Inc. v. Court of Appeals, 224
SCRA 477, 491 (1993); Talisay-Silay Milling Co. v. Asociacion de
Agricultores de Talisay-Silay, Inc., 247 SCRA 361, 384-385 (1995).
[G.R. No. 113725. June 29, 2000]
JOHNNY S. RABADILLA,[1] petitioner, vs. COURT OF
APPEALS AND MARIA MARLENA[2] COSCOLUELLA Y
BELLEZA VILLACARLOS, respondents.
DECISION
PURISIMA, J.:
[1]
[2]

24

sugar as specified in the Fourth paragraph of his testament, to Maria


Marlina Coscolluela y Belleza on the month of December of each year.
SIXTH
I command, in this my addition (Codicil) that the Lot No. 1392, in the
event that the one to whom I have left and bequeathed, and his heir
shall later sell, lease, mortgage this said Lot, the buyer, lessee,
mortgagee, shall have also the obligation to respect and deliver
yearly ONE HUNDRED (100) piculs of sugar to Maria Marlina
Coscolluela y Belleza, on each month of December, SEVENTY FIVE
(75) piculs of Export and TWENTY FIVE (25) piculs of Domestic, until
Maria Marlina shall die, lastly should the buyer, lessee or the
mortgagee of this lot, not have respected my command in this my
addition (Codicil), Maria Marlina Coscolluela y Belleza, shall
immediately seize this Lot No. 1392 from my heir and the latter's
heirs, and shall turn it over to my near desendants, (sic) and the latter
shall then have the obligation to give the ONE HUNDRED (100) piculs
of sugar until Maria Marlina shall die. I further command in this my
addition (Codicil) that my heir and his heirs of this Lot No. 1392, that
they will obey and follow that should they decide to sell, lease,
mortgage, they cannot negotiate with others than my near
descendants and my sister."[4]
Pursuant to the same Codicil, Lot No. 1392 was transferred to the
deceased, Dr. Jorge Rabadilla, and Transfer Certificate of Title No.
44498 thereto issued in his name.
Dr. Jorge Rabadilla died in 1983 and was survived by his wife Rufina
and children Johnny (petitioner), Aurora, Ofelia and Zenaida, all
surnamed Rabadilla.
On August 21, 1989, Maria Marlena Coscolluela y Belleza Villacarlos
brought a complaint, docketed as Civil Case No. 5588, before Branch
52 of the Regional Trial Court in Bacolod City, against the abovementioned heirs of Dr. Jorge Rabadilla, to enforce the provisions of
subject Codicil. The Complaint alleged that the defendant-heirs
violated the conditions of the Codicil, in that:
1. Lot No. 1392 was mortgaged to the Philippine National Bank and
the Republic Planters Bank in disregard of the testatrix's specific
instruction to sell, lease, or mortgage only to the near descendants
and sister of the testatrix.
2. Defendant-heirs failed to comply with their obligation to deliver one
hundred (100) piculs of sugar (75 piculs export sugar and 25 piculs
domestic sugar) to plaintiff Maria Marlena Coscolluela y Belleza from
sugar crop years 1985 up to the filing of the complaint as mandated
by the Codicil, despite repeated demands for compliance.

3. The banks failed to comply with the 6th paragraph of the Codicil
which provided that in case of the sale, lease, or mortgage of the
property, the buyer, lessee, or mortgagee shall likewise have the
obligation to deliver 100 piculs of sugar per crop year to herein
private respondent.
The plaintiff then prayed that judgment be rendered ordering
defendant-heirs to reconvey/return-Lot No. 1392 to the surviving heirs
of the late Aleja Belleza, the cancellation of TCT No. 44498 in the
name of the deceased, Dr. Jorge Rabadilla, and the issuance of a new
certificate of title in the names of the surviving heirs of the late Aleja
Belleza.
On February 26, 1990, the defendant-heirs were declared in default
but on March 28, 1990 the Order of Default was lifted, with respect to
defendant Johnny S. Rabadilla, who filed his Answer, accordingly.
During the pre-trial, the parties admitted that:
On November 15, 1998, the plaintiff (private respondent) and a
certain Alan Azurin, son-in-law of the herein petitioner who was lessee
of the property and acting as attorney-in-fact of defendant-heirs,
arrived at an amicable settlement and entered into a Memorandum of
Agreement on the obligation to deliver one hundred piculs of sugar, to
the following effect:
"That for crop year 1988-89, the annuity mentioned in Entry No.
49074 of TCT No. 44489 will be delivered not later than January of
1989, more specifically, to wit:
75 piculs of 'A' sugar, and 25 piculs of 'B' sugar, or then existing in
any of our names, Mary Rose Rabadilla y Azurin or Alan Azurin, during
December of each sugar crop year, in Azucar Sugar Central; and, this
is considered compliance of the annuity as mentioned, and in the
same manner will compliance of the annuity be in the next
succeeding crop years.
That the annuity above stated for crop year 1985-86, 1986-87, and
1987-88, will be complied in cash equivalent of the number of piculs
as mentioned therein and which is as herein agreed upon, taking into
consideration the composite price of sugar during each sugar crop
year, which is in the total amount of ONE HUNDRED FIVE THOUSAND
PESOS (P105,000.00).
That the above-mentioned amount will be paid or delivered on a
staggered cash installment, payable on or before the end of
December of every sugar crop year, to wit:
For 1985-86, TWENTY SIX THOUSAND TWO HUNDRED FIFTY
(P26,250.00) Pesos, payable on or before December of crop year
1988-89;

25

For 1986-87, TWENTY SIX THOUSAND TWO HUNDRED FIFTY


(P26,250.00) Pesos, payable on or before December of crop year
1989-90;
For 1987-88, TWENTY SIX THOUSAND TWO HUNDRED FIFTY
(P26,250.00) Pesos, payable on or before December of crop year
1990-91; and
For 1988-89, TWENTY SIX THOUSAND TWO HUNDRED FIFTY
(P26,250.00) Pesos, payable on or before December of crop year
1991-92."[5]
However, there was no compliance with the aforesaid Memorandum of
Agreement except for a partial delivery of 50.80 piculs of sugar
corresponding to sugar crop year 1988 -1989.
On July 22, 1991, the Regional Trial Court came out with a decision,
dismissing the complaint and disposing as follows:
"WHEREFORE, in the light of the aforegoing findings, the Court finds
that the action is prematurely filed as no cause of action against the
defendants has as yet arose in favor of plaintiff. While there maybe
the non-performance of the command as mandated exaction from
them simply because they are the children of Jorge Rabadilla, the title
holder/owner of the lot in question, does not warrant the filing of the
present complaint. The remedy at bar must fall. Incidentally, being in
the category as creditor of the left estate, it is opined that plaintiff
may initiate the intestate proceedings, if only to establish the heirs of
Jorge Rabadilla and in order to give full meaning and semblance to her
claim under the Codicil.
In the light of the aforegoing findings, the Complaint being
prematurely filed is DISMISSED without prejudice.
SO ORDERED."[6]
On appeal by plaintiff, the First Division of the Court of Appeals
reversed the decision of the trial court; ratiocinating and ordering
thus:
"Therefore, the evidence on record having established plaintiffappellant's right to receive 100 piculs of sugar annually out of the
produce of Lot No. 1392; defendants-appellee's obligation under Aleja
Belleza's codicil, as heirs of the modal heir, Jorge Rabadilla, to deliver
such amount of sugar to plaintiff-appellant; defendants-appellee's
admitted non-compliance with said obligation since 1985; and, the
punitive consequences enjoined by both the codicil and the Civil Code,
of seizure of Lot No. 1392 and its reversion to the estate of Aleja
Belleza in case of such non-compliance, this Court deems it proper to
order the reconveyance of title over Lot No. 1392 from the estates of
Jorge Rabadilla to the estate of Aleja Belleza. However, plaintiff-

appellant must institute separate proceedings to re-open Aleja


Belleza's estate, secure the appointment of an administrator, and
distribute Lot No. 1392 to Aleja Belleza's legal heirs in order to enforce
her right, reserved to her by the codicil, to receive her legacy of 100
piculs of sugar per year out of the produce of Lot No. 1392 until she
dies.
Accordingly, the decision appealed from is SET ASIDE and another one
entered ordering defendants-appellees, as heirs of Jorge Rabadilla, to
reconvey title over Lot No. 1392, together with its fruits and interests,
to the estate of Aleja Belleza.
SO ORDERED."[7]
Dissatisfied with the aforesaid disposition by the Court of Appeals,
petitioner found his way to this Court via the present petition,
contending that the Court of Appeals erred in ordering the reversion of
Lot 1392 to the estate of the testatrix Aleja Belleza on the basis of
paragraph 6 of the Codicil, and in ruling that the testamentary
institution of Dr. Jorge Rabadilla is a modal institution within the
purview of Article 882 of the New Civil Code.
The petition is not impressed with merit.
Petitioner contends that the Court of Appeals erred in resolving the
appeal in accordance with Article 882 of the New Civil Code on modal
institutions and in deviating from the sole issue raised which is the
absence or prematurity of the cause of action. Petitioner maintains
that Article 882 does not find application as there was no modal
institution and the testatrix intended a mere simple substitution - i.e.
the instituted heir, Dr. Jorge Rabadilla, was to be substituted by the
testatrix's "near descendants" should the obligation to deliver the
fruits to herein private respondent be not complied with. And since
the testatrix died single and without issue, there can be no valid
substitution and such testamentary provision cannot be given any
effect.
The petitioner theorizes further that there can be no valid substitution
for the reason that the substituted heirs are not definite, as the
substituted heirs are merely referred to as "near descendants" without
a definite identity or reference as to who are the "near descendants"
and therefore, under Articles 843[8] and 845[9] of the New Civil Code,
the substitution should be deemed as not written.
The contentions of petitioner are untenable. Contrary to his
supposition that the Court of Appeals deviated from the issue posed
before it, which was the propriety of the dismissal of the complaint on
the ground of prematurity of cause of action, there was no such
deviation. The Court of Appeals found that the private respondent had

26

a cause of action against the petitioner. The disquisition made on


modal institution was, precisely, to stress that the private respondent
had a legally demandable right against the petitioner pursuant to
subject Codicil; on which issue the Court of Appeals ruled in
accordance with law.
It is a general rule under the law on succession that successional
rights are transmitted from the moment of death of the
decedent[10] and compulsory heirs are called to succeed by operation
of law. The legitimate children and descendants, in relation to their
legitimate parents, and the widow or widower, are compulsory heirs.
[11]
Thus, the petitioner, his mother and sisters, as compulsory heirs of
the instituted heir, Dr. Jorge Rabadilla, succeeded the latter by
operation of law, without need of further proceedings, and the
successional rights were transmitted to them from the moment of
death of the decedent, Dr. Jorge Rabadilla.
Under Article 776 of the New Civil Code, inheritance includes all the
property, rights and obligations of a person, not extinguished by his
death. Conformably, whatever rights Dr. Jorge Rabadilla had by virtue
of subject Codicil were transmitted to his forced heirs, at the time of
his death. And since obligations not extinguished by death also form
part of the estate of the decedent; corollarily, the obligations imposed
by the Codicil on the deceased Dr. Jorge Rabadilla, were likewise
transmitted to his compulsory heirs upon his death.
In the said Codicil, testatrix Aleja Belleza devised Lot No. 1392 to Dr.
Jorge Rabadilla, subject to the condition that the usufruct thereof
would be delivered to the herein private respondent every year. Upon
the death of Dr. Jorge Rabadilla, his compulsory heirs succeeded to his
rights and title over the said property, and they also assumed his
(decedent's) obligation to deliver the fruits of the lot involved to
herein private respondent. Such obligation of the instituted heir
reciprocally corresponds to the right of private respondent over the
usufruct, the fulfillment or performance of which is now being
demanded by the latter through the institution of the case at bar.
Therefore, private respondent has a cause of action against petitioner
and the trial court erred in dismissing the complaint below.
Petitioner also theorizes that Article 882 of the New Civil Code on
modal institutions is not applicable because what the testatrix
intended was a substitution - Dr. Jorge Rabadilla was to be substituted
by the testatrix's near descendants should there be noncompliance
with the obligation to deliver the piculs of sugar to private respondent.
Again, the contention is without merit.

Substitution is the designation by the testator of a person or persons


to take the place of the heir or heirs first instituted. Under
substitutions in general, the testator may either (1) provide for the
designation of another heir to whom the property shall pass in case
the original heir should die before him/her, renounce the inheritance
or be incapacitated to inherit, as in a simple substitution, [12] or (2)
leave his/her property to one person with the express charge that it
be transmitted subsequently to another or others, as in a
fideicommissary substitution.[13] The Codicil sued upon contemplates
neither of the two.
In simple substitutions, the second heir takes the inheritance in
default of the first heir by reason of incapacity, predecease or
renunciation.[14] In the case under consideration, the provisions of
subject Codicil do not provide that should Dr. Jorge Rabadilla default
due to predecease, incapacity or renunciation, the testatrix's near
descendants would substitute him. What the Codicil provides is that,
should Dr. Jorge Rabadilla or his heirs not fulfill the conditions imposed
in the Codicil, the property referred to shall be seized and turned over
to the testatrix's near descendants.
Neither is there a fideicommissary substitution here and on this point,
petitioner is correct. In a fideicommissary substitution, the first heir is
strictly mandated to preserve the property and to transmit the
same later to the second heir.[15] In the case under consideration, the
instituted heir is in fact allowed under the Codicil to alienate the
property provided the negotiation is with the near descendants or the
sister of the testatrix. Thus, a very important element of a
fideicommissary substitution is lacking; the obligation clearly
imposing upon the first heir the preservation of the property and its
transmission to the second heir. "Without this obligation to preserve
clearly imposed by the testator in his will, there is no fideicommissary
substitution."[16] Also, the near descendants' right to inherit from the
testatrix is not definite. The property will only pass to them should Dr.
Jorge Rabadilla or his heirs not fulfill the obligation to deliver part of
the usufruct to private respondent.
Another important element of a fideicommissary substitution is also
missing here. Under Article 863, the second heir or the
fideicommissary to whom the property is transmitted must not be
beyond one degree from the first heir or the fiduciary. A
fideicommissary substitution is therefore, void if the first heir is not
related by first degree to the second heir. [17] In the case under
scrutiny, the near descendants are not at all related to the instituted
heir, Dr. Jorge Rabadilla.

27

The Court of Appeals erred not in ruling that the institution of Dr. Jorge
Rabadilla under subject Codicil is in the nature of a modal institution
and therefore, Article 882 of the New Civil Code is the provision of law
in point. Articles 882 and 883 of the New Civil Code provide:
Art. 882. The statement of the object of the institution or the
application of the property left by the testator, or the charge imposed
on him, shall not be considered as a condition unless it appears that
such was his intention.
That which has been left in this manner may be claimed at once
provided that the instituted heir or his heirs give security for
compliance with the wishes of the testator and for the return of
anything he or they may receive, together with its fruits and interests,
if he or they should disregard this obligation.
Art. 883. When without the fault of the heir, an institution referred to
in the preceding article cannot take effect in the exact manner stated
by the testator, it shall be complied with in a manner most analogous
to and in conformity with his wishes.
The institution of an heir in the manner prescribed in Article 882 is
what is known in the law of succession as an institucion sub modo or a
modal institution. In a modal institution, the testator states (1) the
object of the institution, (2) the purpose or application of the property
left by the testator, or (3) the charge imposed by the testator upon
the heir.[18] A "mode" imposes an obligation upon the heir or legatee
but it does not affect the efficacy of his rights to the succession. [19] On
the other hand, in a conditional testamentary disposition, the
condition must happen or be fulfilled in order for the heir to be
entitled to succeed the testator. The condition suspends but does not
obligate; and the mode obligates but does not suspend. [20] To some
extent, it is similar to a resolutory condition.[21]
From the provisions of the Codicil litigated upon, it can be gleaned
unerringly that the testatrix intended that subject property be
inherited by Dr. Jorge Rabadilla. It is likewise clearly worded that the
testatrix imposed an obligation on the said instituted heir and his
successors-in-interest to deliver one hundred piculs of sugar to the
herein private respondent, Marlena Coscolluela Belleza, during the
lifetime of the latter. However, the testatrix did not make Dr. Jorge
Rabadilla's inheritance and the effectivity of his institution as a
devisee, dependent on the performance of the said obligation. It is
clear, though, that should the obligation be not complied with, the
property shall be turned over to the testatrix's near descendants. The
manner of institution of Dr. Jorge Rabadilla under subject Codicil is
evidently modal in nature because it imposes a charge upon the

instituted heir without, however, affecting the efficacy of such


institution.
Then too, since testamentary dispositions are generally acts of
liberality, an obligation imposed upon the heir should not be
considered a condition unless it clearly appears from the Will itself
that such was the intention of the testator. In case of doubt, the
institution should be considered as modal and not conditional.[22]
Neither is there tenability in the other contention of petitioner that the
private respondent has only a right of usufruct but not the right to
seize the property itself from the instituted heir because the right to
seize was expressly limited to violations by the buyer, lessee or
mortgagee.
In the interpretation of Wills, when an uncertainty arises on the face of
the Will, as to the application of any of its provisions, the testator's
intention is to be ascertained from the words of the Will, taking into
consideration the circumstances under which it was made. [23] Such
construction as will sustain and uphold the Will in all its parts must be
adopted.[24]
Subject Codicil provides that the instituted heir is under obligation to
deliver One Hundred (100) piculs of sugar yearly to Marlena Belleza
Coscuella. Such obligation is imposed on the instituted heir, Dr. Jorge
Rabadilla, his heirs, and their buyer, lessee, or mortgagee should they
sell, lease, mortgage or otherwise negotiate the property involved.
The Codicil further provides that in the event that the obligation to
deliver the sugar is not respected, Marlena Belleza Coscuella shall
seize the property and turn it over to the testatrix's near descendants.
The non-performance of the said obligation is thus with the sanction
of seizure of the property and reversion thereof to the testatrix's near
descendants. Since the said obligation is clearly imposed by the
testatrix, not only on the instituted heir but also on his successors-ininterest, the sanction imposed by the testatrix in case of nonfulfillment of said obligation should equally apply to the instituted heir
and his successors-in-interest.
Similarly unsustainable is petitioner's submission that by virtue of the
amicable settlement, the said obligation imposed by the Codicil has
been assumed by the lessee, and whatever obligation petitioner had
become the obligation of the lessee; that petitioner is deemed to have
made a substantial and constructive compliance of his obligation
through the consummated settlement between the lessee and the
private respondent, and having consummated a settlement with the
petitioner, the recourse of the private respondent is the fulfillment of

28

the obligation under the amicable settlement and not the seizure of
subject property.
Suffice it to state that a Will is a personal, solemn, revocable and free
act by which a person disposes of his property, to take effect after his
death.[25] Since the Will expresses the manner in which a person
intends how his properties be disposed, the wishes and desires of the
testator must be strictly followed. Thus, a Will cannot be the subject of
a compromise agreement which would thereby defeat the very
purpose of making a Will.
WHEREFORE, the petition is hereby DISMISSED and the decision of
the Court of Appeals, dated December 23, 1993, in CA-G.R. No. CV35555 AFFIRMED. No pronouncement as to costs
SO ORDERED.

SPOUSES RICARDO M. TAREDO AND TERESITA BARERA


TAREDO, respondents.
DECISION
PANGANIBAN, J.:
Is a sale of future inheritance valid? In multiple sales of the same
real property, who has preference in ownership? What is the probative
value of the lower courts finding of good faith in registration of such
sales in the registry of property? These are the main questions raised
in this Petition for review on certiorari under Rule 45 of the Rules of
Court to set aside and reverse the Decision 1 of the Court of
Appeals2 in CA-G.R. CV NO. 24987 promulgated on September 26,
1991 affirming the decision of the Regional Trial Court, Branch 63,
Third Judicial Region, Tarlac, Tarlac in Civil Case No. 6328, and its
Resolution denying reconsideration thereof, promulgated on May 27,
1992.
By the Courts Resolution on October 25, 1995, this case (along
with several others) was transferred from the First to the Third
Division and after due deliberation, the Court assigned it to the
undersigned ponenle for the writing of this Decision.
The Facts
On October 20, 1962, Lazardo Taedo executed a notarized deed
of absolute sale in favor of his eldest brother, Ricardo Taedo, and the
latters wife, Teresita Barera, private respondents herein, whereby he
conveyed to the latter in consideration of P1,500.00, one hectare of
whatever share I shall have over Lot No. 191 of the cadastral survey
of Gerona, Province of Tarlac and covered by Title T-l3829 of the
Register of Deeds of Tarlac, the said property being his future
inheritance from his parents (Exh. 1). Upon the death of his father
Matias, Lazaro executed an Affidavit of Conformity dated February 28,
1980 (Exh. 3) to re-affirm, respect. acknowledge and validate the sale
I made in 1962. On January 13, 1981, Lazaro executed another
notarized deed of sale in favor of private respondents covering his
undivided ONE TWELVE (1/12) of a parcel of land known as Lot 191 x x
(Exh. 4). He acknowledged therein his receipt of P 10,000.00 as
consideration therefor. In February 1981, Ricardo learned that Lazaro
sold the same property to his children, petitioners herein, through a
deed of sale dated December 29, 1980 (Exh. E). On June 7, 1982,
private respondents recorded the Deed of Sale (Exh. 4) in their favor
in the Registry of Deeds and the corresponding entry was made in
Transfer Certificate of Title No. 166451 (Exh. 5).

Was spelled interchangeably in Rollo as Ravadilla.


Was spelled interchangeably in Rollo as Marlina.
[3]
Penned by Justice Santiago M. Kapunan (Chairman) and concurred
in by Justices Minerva P. Gonzaga-Reyes and Eduardo G. Montenegro,
(Members)
[4]
Annex "C", Rollo, pp. 34-35.
[5]
Rollo, pp. 65-66.
[6]
RTC Decision, pp. 8-9.
[7]
CA Decision, p. 14.
[8]
Art. 843. The testator shall designate the heir by his name and
surname, and when there are two persons having the same names, he
shall indicate some circumstance by which the instituted heir may be
known.
Even though the testator may have omitted the name of the heir,
should he designate him in such manner that there can be no doubt
as to who has been instituted, the institution shall be valid.
[9]
Art. 845. Every disposition in favor of an unknown person shall be
void, unless by some event or circumstance his identity becomes
certain. However, a disposition in favor of a definite class or group of
persons shall be valid.
[10]
Article 777, New Civil Code.
[11]
Ibid., Article 887.
[12]
Ibid., Article 859.
[G.R. No. 104482. January 22, 1996]
BELINDA TAREDO, for herself and in representation of her
brothers and sisters, and TEOFILA CORPUZ TANEDO,
representing her minor daughter VERNA
TANEDO, petitioners, vs. THE COURT OF APPEALS,
[1]
[2]

29

Petitioners on July 16, 1982 filed a complaint for rescission (plus


damages) of the deeds of sale executed by Lazaro in favor of private
respondents covering the property inherited by Lazaro from his father.
Petitioners claimed that their father, Lazaro, executed an
Absolute Deed of Sale dated December 29, 1980 (Exit. E), conveying
to his ten children his allotted portion under the extrajudicial partition
executed by the heirs of Matias, which deed included the land in
litigation (Lot 191).
Petitioners also presented in evidence: (1) a private writing
purportedly prepared and signed by Matias dated December 28, 1978,
stating that it was his desire that whatever inheritance Lazaro would
receive from him should be given to his (Lazaros) children (Exh. A); (2)
a typewritten document dated March 10, 1979 signed by Lazaro in the
presence of two witnesses, wherein he confirmed that he would
voluntarily abide by the wishes of his father, Matias, to give to his
(Lazaros) children all the property he would inherit from the latter
(Exh. B); and (3) a letter dated January 1, 1980 of Lazaro to his
daughter, Carmela, stating that his share in the extrajudicial
settlement of the estate of his father was intended for his children,
petitioners herein (Exh. C).
Private respondents, however presented in evidence a Deed of
Revocation of a Deed of Sale dated March 12, 1981 (Exh. 6), wherein
Lazaro revoked the sale in favor of petitioners for the reason that it
was simulated or fictitious - without any consideration whatsoever.
Shortly after the case a quo was filed, Lazaro executed a sworn
statement (Exh. G) which virtually repudiated the contents of the
Deed of Revocation of a Deed of Sale (Exh. 6) and the Deed of Sale
(Exh. 4) in favor of private respondents. However, Lazaro testified that
he sold the property to Ricardo, and that it was a lawyer who induced
him to execute a deed of sale in favor of his children after giving him
five pesos (P5.00) to buy a drink (TSN September 18, 1985, pp. 204205).
The trial court decided in favor of private respondents, holding
that petitioners failed to adduce a preponderance of evidence to
support (their) claim. On appeal, the Court of Appeals affirmed the
decision of the trial court, ruling that the Deed of Sale dated January
13, 1981 (Exh. 9) was valid and that its registration in good faith
vested title in said respondents.
The Issues
Petitioners raised the following errors in the respondent Court,
which they also now allege in the instant Petition:

I. The trial court erred in concluding that the Contract of Sale of


October 20, 1962 (Exhibit 7, Answer) is merely voidable or annulable
and not void ab initio pursuant to paragraph 2 of Article 1347 of the
New Civil Code involving as it does a future inheritance.
II. The trial court erred in holding that defendants-appellees acted in
good faith in registering the deed of sale of January 13, 1981 (Exhibit
9) with the Register of Deeds of Tarlac and therefore ownership of the
land in question passed on to defendants-appellees.
III. The trial court erred in ignoring and failing to consider the
testimonial and documentary evidence of plaintiffs-appellants which
clearly established by preponderance of evidence that they are
indeed the legitimate and lawful owners of the property in question.
IV. The decision is contrary to law and the facts of the case and the
conclusions drawn from the established facts are illogical and offtangent.
From the foregoing, the issues may be restated as follows:
1. Is the sale of a future inheritance valid?
2. Was the subsequent execution on January 13, 1981 (and
registration with the Registry of Property) of a deed of sale
covering the same property to the same buyers valid?
3. May this Court review the findings of the respondent Court
(a) holding that the buyers acted in good faith in
registering the said subsequent deed of sale and (b) in
failing to consider petitioners evidence? Are the
conclusions of the respondent Court illogical and offtangent?
The Courts Ruling
At the outset, let it be clear that the errors which are reviewable
by this Court in this petition for review on certiorari are only those
allegedly committed by the respondent Court of Appeals and not
directly those of the trial court, which is not a party here. The
assignment of errors in the petition quoted above are therefore totally
misplaced, and for that reason, the petition should be dismissed. But
in order to give the parties substantial justice we have decided to
delve into the issues as above re-stated. The errors attributed by
petitioners to the latter (trial) court will be discussed only insofar as
they are relevant to the appellate courts assailed Decision and
Resolution.
The sale made in 1962 involving future inheritance is not really at
issue here. In context, the assailed Decision conceded it may be
legally correct that a contract of sale of anticipated future inheritance
is null and void.3

30

But to remove all doubts, we hereby categorically rule that,


pursuant to Article 1347 of the Civil Code, (n)o contract may be
entered into upon a future inheritance except in cases expressly
authorized by law.
Consequently, said contract made in 1962 is not valid and cannot
be the source of any right nor the creator of any obligation between
the parties.
Hence, the affidavit of conformity dated February 28, 1980,
insofar as it sought to validate or ratify the 1962 sale, is also useless
and, in the words of the respondent Court, suffers from the same
infirmity. Even private respondents in their memorandum 4 concede
this.
However, the documents that are critical to the resolution of this
case are: (a) the deed of sale of January 13, 1981 in favor of private
respondents covering Lazaros undivided inheritance of one-twelfth
(1/12) share in Lot No. 191, which was subsequently registered on
June 7, 1982; and (b) the deed of sale dated December 29, 1980 in
favor of petitioners covering the same property. These two documents
were executed after the death of Matias (and his spouse) and after a
deed of extrajudicial settlement of his (Matias) estate was executed,
thus vesting in Lazaro actual title over said property. In other words,
these dispositions, though conflicting, were no longer infected with
the infirmities of the 1962 sale.
Petitioners contend that what was sold on January 13, 1981 was
only one-half hectare out of Lot No. 191, citing as authority the trial
courts decision. As earlier pointed out, what is on review in these
proceedings by this Court is the Court of Appeals decision - which
correctly identified the subject matter of the January 13, 1981 sale to
be the entire undivided 1/12 share of Lazaro in Lot No. 191 and which
is the same property disposed of on December 29, 1980 in favor of
petitioners.
Critical in determining which of these two deeds should be given
effect is the registration of the sale in favor of private respondents
with the register of deeds on June 7, 1982.
Article 1544 of the Civil Code governs the preferential rights of
vendees in cases of multiple sales, as follows:
Art. 1544. If the same thing should have been sold to different
vendees, the ownership shall be transferred to the person who may
have first taken possession thereof in good faith, if it should be
movable property.

Should it be immovable property, the ownership shall belong to the


person acquiring it who in good faith first recorded it in the Registry of
Property.
Should there be no inscription, the ownership shall pertain to the
person who in good faith was first in the possession; and, in the
absence thereof, to the person who presents the oldest title, provided
there is good faith.
The property in question is land, an immovable, and following the
above-quoted law, ownership shall belong to the buyer who in good
faith registers it first in the registry of property. Thus, although the
deed of sale in favor of private respondents was later than the one in
favor of petitioners, ownership would vest in the former because of
the undisputed fact of registration. On the other hand, petitioners
have not registered the sale to them at all.
Petitioners contend that they were in possession of the property
and that private respondents never took possession thereof. As
between two purchasers, the one who registered the sale in his favor
has a preferred right over the other who has not registered his title,
even if the latter is in actual possession of the immovable property.5
As to third issue, while petitioners conceded the fact of
registration, they nevertheless contended that it was done in bad
faith. On this issue, the respondent Court ruled:
Under the second assignment of error, plaintiffs-appellants contend
that defendants-appellees acted in bad faith when they registered the
Deed of Sale in their favor as appellee Ricardo already knew of the
execution of the deed of sale in favor of the plaintiffs; appellants cite
the testimony of plaintiff Belinda Tafledo to the effect that defendant
Ricardo Taedo called her up on January 4 or 5, 1981 to tell her that he
was already the owner of the land in question but the contract of sale
between our father and us were (sic) already consumated (pp. 9-10,
tsn, January 6, 1984). This testimony is obviously self-serving, and
because it was a telephone conversation, the deed of sale
dated December 29, 1980 was not shown; Belinda merely told her
uncle that there was already a document showing that plaintiffs are
the owners (p. 80). Ricardo Taedo controverted this and testified that
he learned for the first time of the deed of sale executed by Lazaro in
favor of his children about a month or sometime in February 1981 (p.
111, tsn, Nov. 28, 1984). x x x6
The respondent Court, reviewing the trial courts findings, refused to
overturn the latters assessment of the testimonial evidence, as
follows:

31

We are not prepared to set aside the finding of the lower court
upholding Ricardo Tanedos testimony, as it involves a matter of
credibility of witnesses which the trial judge, who presided at the
hearing, was in a better position to resolve. (Court of Appeals
Decision, p. 6.)
In this connection, we note the tenacious allegations made by
petitioners, both in their basic petition and in their memorandum, as
follows:
1. The respondent Court allegedly ignored the claimed fact
that respondent Ricardo by fraud and deceit and with
foreknowledge that the property in question had already
been sold to petitioners, made Lazaro execute the deed of
January 13, 1981;
2. There is allegedly adequate evidence to show that only 1/2
of the purchase price of P10,000.00 was paid at the time
of the execution of the deed of sale, contrary to the
written acknowledgment, thus showing bad faith;
3. There is allegedly sufficient evidence showing that the
deed of revocation of the sale in favor of petitioners was
tainted with fraud or deceit.
4. There is allegedly enough evidence to show that private
respondents took undue advantage over the weakness
and unschooled and pitiful situation of Lazaro Tafledo . . .
and that respondent Ricardo Taedo exercised moral
ascendancy over his younger brother he being the eldest
brother and who reached fourth year college of law and at
one time a former Vice-Governor of Tarlac, while his
younger brother only attained first year high school x x x ;
5. The respondent Court erred in not giving credence to
petitioners
evidence,
especially
Lazaro
Taedos Sinumpaang Salaysay dated July 27, 1982 stating
that Ricardo Taedo deceived the former in executing the
deed of sale in favor of private respondents.
To be sure, there are indeed many conflicting documents and
testimonies as well as arguments over their probative value and
significance. Suffice it to say, however, that all the above contentions
involve questions of fact, appreciation of evidence and credibility of
witnesses, which are not proper in this review. It is well-settled that
the Supreme Court is not a trier of facts. In petitions for review under
Rule 45 of the Revised Rules of Court, only questions of law may be
raised and passed upon. Absent any whimsical or capricious exercise
of judgment, and unless the lack of any basis for the conclusions

made by the lower courts be amply demonstrated, the Supreme Court


will not disturb their findings. At most, it appears that petitioners have
shown that their evidence was not believed by both the trial and the
appellate courts, and that the said courts tended to give more
credence to the evidence presented by private respondents. But this
in itself is not a reason for setting aside such findings. We are far from
convinced that both courts gravely abused their respective authorities
and judicial prerogatives.
As held in the recent case of Chua Tiong Tay vs. Court of Appeals
and Goidrock Construction and Development Corp.:7
The Court has consistently held that the factual findings of the trial
court, as well as the Court of Appeals, are final and conclusive and
may not be reviewed on appeal. Among the exceptional
circumstances where a reassessment of facts found by the lower
courts is allowed are when the conclusion is a finding grounded
entirely on speculation, surmises or conjectures; when the inference
made is manifestly absurd, mistaken or Impossible; when there is
grave abuse of discretion in the appreciation of facts; when the
judgment is premised on a misapprehension of facts; when the
findings went beyond the issues of the case and the same are
contrary to the admissions of both appellant and appellee. After a
careful study of the case at bench, we find none of the above grounds
present to justify the re-evaluation of the findings of fact made by the
courts below.
In the same vein, the ruling in the recent case of South Sea
Surety and Insurance Company, Inc. vs. Hon. Court of Appeals, et al.
[8]
is equally applicable to the present case:
We see no valid reason to discard the factual conclusions of the
appellate court. x x x (I)t is not the function of this Court to assess and
evaluate all over again the evidence, testimonial and documentary,
adduced by the parties, particularly where, such as here, the findings
of both the trial court and the appellate court on the matter
coincide. (italics supplied)
WHEREFORE, the petition is DENIED and the assailed Decision
of the Court of Appeals is AFFIRMED. No Costs.
SO ORDERED.
Narvasa, C.J. (Chairman), Davide, Jr., Melo, and Francisco,
JJ., concur.

32

RoIlo, pp. 58-64.

which granted the appeal filed by herein respondents Spouses Jose


Lumbao and Proserfina Lumbao (Spouses Lumbao) and ordered herein
petitioners Spouses Virgilio F. Santos and Esperanza Lati, Spouses
Victorino F. Santos and Lagrimas F. Santos, Ernesto F. Santos and
Tadeo F. Santos to reconvey to respondents Spouses Lumbao the
subject property and to pay the latter attorneys fees and litigation
expenses, thus, reversing the Decision [3] of the Regional Trial Court
(RTC) of Pasig City, dated 17 June 1998 which dismissed the Complaint
for Reconveyance with Damages filed by respondents Spouses
Lumbao for lack of merit.

Thirteenth Division, composed of i. Minerva P. GonzagaReyes, ponenle, and JJ., Arturo B. Buena, Chairman and Quirino D.
Abad Santos, Jr., member.
3
CA Decision, p. 5; rollo, p. 62.
4
At pp. 11-12; rollo, pp. 145-146.
5
Nuguidvs. Court ofAppeols, 171 SCRA 213 (March 13, 1989).
6
Court of Appeals Decision, p. 6; rollo, p. 63.
7
GR. No. 112130, March 31, 1995; J. Flerida Ruth P. Romero, ponente.
[8]
G.R. No. 102253, June 2, 1995; J. Jose C. Vitug, ponente.
2

Herein petitioners Virgilio, Victorino, Ernesto and Tadeo, all


surnamed Santos, are the legitimate and surviving heirs of the late
Rita Catoc Santos (Rita), who died on 20 October 1985. The other
petitioners Esperanza Lati and Lagrimas Santos are the daughters-inlaw of Rita.

SPS. VIRGILIO F. SANTOS & ESPERANZA


LATISANTOS, SPS.VICTORINO F. SANTOS,
&
LAGRIMASSANTOS,
ERNESTO
F.
SANTOS, and TADEO F. SANTOS,
Petitioners,

Herein respondents Spouses Jose Lumbao and Proserfina Lumbao are


the alleged owners of the 107-square meter lot (subject property),
G.R. No. 169129
which they purportedly bought from Rita during her lifetime.
Present:

The facts of the present case are as follows:


YNARES-SANTIAGO,
Chairperson,
On two separate occasions during her lifetime, Rita sold to
AUSTRIA-MARTINEZ,
respondents Spouses Lumbao the subject property which is a part of
*
CALLEJO, SR.,
her share in the estate of her deceased mother, Maria Catoc (Maria),
- versus CHICO-NAZARIO, and
who died intestate on 19 September 1978. On the first occasion, Rita
NACHURA, JJ.
sold 100 square meters of her inchoate share in her mothers estate
through a document denominated as Bilihan ng Lupa, dated 17
SPS. JOSE LUMBAO and PROSERFINA
August 1979.[4] Respondents Spouses Lumbao claimed the execution
LUMBAO,
Promulgated:
of the aforesaid document was witnessed by petitioners Virgilio and
Respondents.
Tadeo, as shown by their signatures affixed therein. On the second
March 28, 2007
occasion, an additional seven square meters was added to the land as
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
evidenced by a document also denominated as Bilihan ng Lupa,
dated 9 January 1981.[5]
DECISION

After acquiring the subject property, respondents Spouses Lumbao


took actual possession thereof and erected thereon a house which
they have been occupying as exclusive owners up to the present. As
the exclusive owners of the subject property, respondents Spouses
Lumbao made several verbal demands upon Rita, during her lifetime,
and thereafter upon herein petitioners, for them to execute the
necessary documents to effect the issuance of a separate title in favor
of respondents Spouses Lumbao insofar as the subject property is
concerned. Respondents Spouses Lumbao alleged that prior to her
death, Rita informed respondent Proserfina Lumbao she could not

CHICO-NAZARIO, J.:
Before this Court is a Petition for Review on Certiorari under Rule 45 of
the 1997 Revised Rules of Civil Procedure seeking to annul and set
aside the Decision[1] and Resolution[2] of the Court of Appeals in CAG.R. CV No. 60450 entitled, Spouses Jose Lumbao and Proserfina
Lumbao v. Spouses Virgilio F. Santos and Esperanza Lati, Spouses
Victorino F. Santos and Lagrimas F. Santos, Ernesto F. Santos and
Tadeo F. Santos, dated 8 June 2005 and 29 July 2005, respectively,

33

deliver the title to the subject property because the entire property
inherited by her and her co-heirs from Maria had not yet been
partitioned.

The trial court rendered a Decision on 17 June 1998, the


dispositive portion of which reads as follows:
Premises considered, the instant complaint is
hereby denied for lack of merit.

On 2 May 1986, the Spouses Lumbao claimed that petitioners, acting


fraudulently and in conspiracy with one another, executed a Deed of
Extrajudicial Settlement,[6] adjudicating and partitioning among
themselves and the other heirs, the estate left by Maria, which
included the subject property already sold to respondents Spouses
Lumbao and now covered by TCT No. 81729[7] of the Registry of Deeds
of Pasig City.

Considering that [petitioners] have incurred


expenses in order to protect their interest,
[respondents spouses Lumbao] are hereby directed to
pay [petitioners], to wit: 1) the amount of P30,000.00
as attorneys fees and litigation expenses, and 2) costs
of the suit.[11]

On 15 June 1992, respondents Spouses Lumbao, through


counsel, sent a formal demand letter [8] to petitioners but despite
receipt of such demand letter, petitioners still failed and refused to
reconvey the subject property to the respondents Spouses
Lumbao. Consequently, the latter filed a Complaint for Reconveyance
with Damages[9] before the RTC of Pasig City.

Aggrieved, respondents Spouses Lumbao appealed to the Court of


Appeals. On 8 June 2005, the appellate court rendered a Decision,
thus:
WHEREFORE, premises considered, the present
appeal is hereby GRANTED. The appealed Decision
dated June 17, 1998 of the Regional Trial Court
of Pasig City, Branch 69 in Civil Case No. 62175 is
hereby REVERSED and SET ASIDE. A new judgment is
hereby entered ordering [petitioners] to reconvey 107
square meters of the subject [property] covered by TCT
No. PT-81729 of the Registry of Deeds of Pasig City,
Metro Manila, and to pay to [respondents spouses
Lumbao] the sum of P30,000.00 for attorneys fees and
litigation expenses.

Petitioners filed their Answer denying the allegations that the


subject property had been sold to the respondents Spouses
Lumbao. They likewise denied that the Deed of Extrajudicial
Settlement had been fraudulently executed because the same was
duly published as required by law. On the contrary, they prayed for
the dismissal of the Complaint for lack of cause of action because
respondents Spouses Lumbao failed to comply with the Revised
Katarungang Pambarangay Law under Republic Act No. 7160,
otherwise known as the Local Government Code of 1991, which
repealed Presidential Decree No. 1508[10] requiring first resort to
barangay conciliation.

No pronouncement as to costs.[12]

Respondents Spouses Lumbao, with leave of court, amended


their Complaint because they discovered that on 16 February 1990,
without their knowledge, petitioners executed a Deed of Real Estate
Mortgage in favor of Julieta S. Esplana for the sum of P30,000.00. The
said Deed of Real Estate Mortgage was annotated at the back of TCT
No. PT-81729 on 26 April 1991. Also, in answer to the allegation of the
petitioners that they failed to comply with the mandate of the Revised
Katarungang Pambarangay Law, respondents Spouses Lumbao said
that the Complaint was filed directly in court in order that prescription
or the Statute of Limitations may not set in.

Dissatisfied, petitioners filed a Motion for Reconsideration of


the aforesaid Decision but it was denied in the Resolution of the
appellate court dated 29 July 2005 for lack of merit.
Hence, this Petition.
The grounds relied upon by the petitioners are the following:
I.
THE
APPELLATE
COURT
COMMITTED
A
REVERSIBLE
ERROR
IN
REVERSING THE DECISION OF THE TRIAL
COURT, THEREBY CREATING A VARIANCE ON
THE FINDINGS OF FACTS OF TWO COURTS.

During the trial, respondents Spouses Lumbao presented


Proserfina Lumbao and Carolina Morales as their witnesses, while the
petitioners presented only the testimony of petitioner Virgilio.

34

II.
THE
APPELLATE
COURT
COMMITTED
A
REVERSIBLE
ERROR
IN
ORDERING THE PETITIONERS TO RECONVEY
THE
SUBJECT
[PROPERTY]
TO
THE
RESPONDENTS [SPOUSES LUMBAO] AND IN NOT
RULING THAT THEY ARE GUILTY OF LACHES,
HENCE
THEY
CANNOT
RECOVER
THE LOT ALLEGEDLY SOLD TO THEM.

Petitioners ask this Court to scrutinize the evidence presented


in this case, because they claim that the factual findings of the trial
court and the appellate court are conflicting. They allege that the
findings of fact by the trial court revealed that petitioners Virgilio and
Tadeo did not witness the execution of the documents known as
Bilihan ng Lupa; hence, this finding runs counter to the conclusion
made by the appellate court. And even assuming that they were
witnesses to the aforesaid documents, still, respondents Spouses
Lumbao were not entitled to the reconveyance of the subject property
because they were guilty of laches for their failure to assert their
rights for an unreasonable length of time. Since respondents Spouses
Lumbao had slept on their rights for a period of more than 12 years
reckoned from the date of execution of the second Bilihan ng Lupa, it
would be unjust and unfair to the petitioners if the respondents will be
allowed to recover the subject property.

III.
THE APPELLATE COURT COMMITTED
A REVERSIBLE ERROR IN NOT FINDING HEREIN
PETITIONER[S] TO BE IN GOOD FAITH IN
EXECUTING THE DEED OF EXTRAJUDICIAL
SETTLEMENT DATED [2 MAY 1986].
IV.
THE APPELLATE COURT COMMITTED
A REVERSIBLE ERROR IN NOT FINDING THAT
PETITIONERS ARE NOT LEGALLY BOUND TO
COMPLY WITH THE SUPPOSED BILIHAN NG LUPA
DATED [17 AUGUST 1979] AND [9 JANUARY
1981] THAT WERE SUPPOSEDLY EXECUTED BY
THE LATE RITA CATOC.

Petitioners allege they are in good faith in executing the Deed


of Extrajudicial Settlement because even respondents Spouses
Lumbaos witness, Carolina Morales, testified that neither petitioner
Virgilio nor petitioner Tadeo was present during the execution of the
Bilihan ng Lupa, dated 17 August 1979 and 9 January
1981. Petitioners affirm that the Deed of Extrajudicial Settlement was
published in a newspaper of general circulation to give notice to all
creditors of the estate subject of partition to contest the same within
the period prescribed by law. Since no claimant appeared to interpose
a claim within the period allowed by law, a title to the subject property
was then issued in favor of the petitioners; hence, they are considered
as holders in good faith and therefore cannot be barred from entering
into any subsequent transactions involving the subject property.

V.
THE
APPELLATE
COURT
COMMITTED A REVERSIBLE ERROR IN NOT
FINDING
THAT
RESPONDENTS
[SPOUSES
LUMBAOS] ACTION FOR RECONVEYANCE WITH
DAMAGES CANNOT BE SUPPORTED WITH AN
UNENFORCEABLE DOCUMENTS, SUCH AS THE
BILIHAN NG LUPA DATED [17 AUGUST 1979]
AND [9 JANUARY 1981].

Petitioners also contend that they are not bound by the


documents denominated as Bilihan ng Lupa because the same were
null and void for the following reasons: 1) for being falsified
documents because one of those documents made it appear that
petitioners Virgilio and Tadeo were witnesses to its execution and that
they appeared personally before the notary public, when in truth and
in fact they did not; 2) the identities of the properties in the Bilihan ng
Lupa, dated 17 August 1979 and 9 January 1981 in relation to the
subject property in litigation were not established by the evidence
presented by the respondents Spouses Lumbao; 3) the right of the
respondents Spouses Lumbao to lay their claim over the subject
property had already been barred through estoppel by laches; and 4)
the respondents Spouses Lumbaos claim over the subject property
had already prescribed.

VI.
THE APPELLATE COURT COMMITTED
A REVERSIBLE ERROR IN NOT FINDING THAT
RESPONDENTS
[SPOUSES
LUMBAOS]
COMPLAINT
FOR
RECONVEYANCE
IS
DISMISSABLE (SIC) FOR NON COMPLIANCE OF
THE MANDATE OF [P.D. NO.] 1508, AS
AMENDED BY Republic Act No. 7160.
VII.
THE APPELLATE COURT COMMITTED
A REVERSIBLE ERROR IN NOT FINDING THAT
RESPONDENTS [SPOUSES LUMBAO] SHOULD BE
HELD LIABLE FOR PETITIONERS CLAIM FOR
DAMAGES AND ATTORNEY[]S FEES.

35

the Revised Katarungang Pambarangay Law under Republic Act No.


7160. This argument cannot be sustained.

Finally, petitioners claim that the Complaint for Reconveyance


with Damages filed by respondents Spouses Lumbao was dismissible
because they failed to comply with the mandate of Presidential
Decree No. 1508, as amended by Republic Act No. 7160, particularly
Section 412 of Republic Act No. 7160.

Section 408 of the aforesaid law and Administrative Circular No. 1493[15] provide that all disputes between parties actually residing in the
same city or municipality are subject to barangay conciliation. A prior
recourse thereto is a pre-condition before filing a complaint in court or
any government offices. Non-compliance with the said condition
precedent could affect the sufficiency of the plaintiffs cause of action
and make his complaint vulnerable to dismissal on ground of lack of
cause of action or prematurity; but the same would not prevent a
court of competent jurisdiction from exercising its power of
adjudication over the case before it, where the defendants failed to
object to such exercise of jurisdiction.[16]

Given the foregoing, the issues presented by the petitioners


may be restated as follows:
I.

II.

III.

Whether or not the Complaint for


Reconveyance
with
Damages
filed
by
respondents spouses Lumbao is dismissible for
their failure to comply with the mandate of the
Revised Katarungang Pambarangay Law under
R.A. No. 7160.

While it is true that the present case should first be referred to the
Barangay Lupon for conciliation because the parties involved herein
actually reside in the same city (Pasig City) and the dispute between
them involves a real property, hence, the said dispute should have
been brought in the city in which the real property, subject matter of
the controversy, is located, which happens to be the same city where
the contending parties reside. In the event that respondents Spouses
Lumbao failed to comply with the said condition precedent, their
Complaint for Reconveyance with Damages can be dismissed. In this
case, however, respondents Spouses Lumbaos non-compliance with
the
aforesaid
condition
precedent
cannot
be
considered
fatal. Although petitioners alleged in their answer that the Complaint
for Reconveyance with Damages filed by respondents spouses
Lumbao should be dismissed for their failure to comply with the
condition precedent, which in effect, made the complaint prematurely
instituted and the trial court acquired no jurisdiction to hear the case,
yet, they did not file a Motion to Dismiss the said complaint.

Whether or not the documents


known as Bilihan ng Lupa are valid and
enforceable, thus, they can be the bases of the
respondents spouses Lumbaos action for
reconveyance with damages.
Whether or not herein petitioners
are legally bound to comply with the Bilihan ng
Lupa dated 17 August 1979 and 9 January
1981 and consequently, reconvey the subject
property to herein respondents spouses
Lumbao.

It is well-settled that in the exercise of the Supreme Courts


power of review, the court is not a trier of facts and does not normally
undertake the re-examination of the evidence presented by the
contending parties during the trial of the case considering that the
findings of fact of the Court of Appeals are conclusive and binding on
the Court.[13] But, the rule is not without exceptions. There are several
recognized exceptions[14] in which factual issues may be resolved by
this Court. One of these exceptions is when the findings of the
appellate court are contrary to those of the trial court. This exception
is present in the case at bar.

Emphasis must be given to the fact that the petitioners could


have prevented the trial court from exercising jurisdiction over the
case had they filed a Motion to Dismiss. However, instead of doing so,
they invoked the very same jurisdiction by filing an answer seeking an
affirmative relief from it. Worse, petitioners actively participated in the
trial of the case by presenting their own witness and by crossexamining the witnesses presented by the respondents Spouses
Lumbao. It is elementary that the active participation of a party in a
case pending against him before a court is tantamount to recognition
of that courts jurisdiction and a willingness to abide by the resolution
of the case which will bar said party from later on impugning the
courts jurisdiction.[17] It is also well-settled that the non-referral of a
case for barangay conciliation when so required under the law is not

Going to the first issue presented in this case, it is the argument of


the petitioners that the Complaint for Reconveyance with Damages
filed by respondents Spouses Lumbao should be dismissed for failure
to comply with the barangay conciliation proceedings as mandated by

36

ATTY. BUGARING:

jurisdictional in nature and may therefore be deemed waived if not


raised seasonably in a motion to dismiss. [18] Hence, herein petitioners
can no longer raise the defense of non-compliance with the barangay
conciliation proceedings to seek the dismissal of the complaint filed
by the respondents Spouses Lumbao, because they already waived
the said defense when they failed to file a Motion to Dismiss.

The question is misleading, your Honor. Counsel premised the


question that he does not have any knowledge but not
that he does not know.
ATTY. CHIU:
Q. Being you are one of the witnesses of this document? [I]s it
not?

As regards the second issue, petitioners maintain that the


Bilihan ng Lupa, dated 17 August 1979 and 9 January 1981 are null
and void for being falsified documents as it is made to appear that
petitioners Virgilio and Tadeo were present in the execution of the said
documents and that the identities of the properties in those
documents in relation to the subject property has not been
established by the evidence of the respondents Spouses
Lumbao. Petitioners also claim that the enforceability of those
documents is barred by prescription of action and laches.

WITNESS:
A.
No, sir.
Q. I am showing to you this document, there is a signature at the
left hand margin of this document Virgilio Santos, will
you please go over the same and tell the court whose
signature is this?
A. I dont remember, sir, because of the length of time that had
passed.

It is the petitioners incessant barking that the Bilihan


ng Lupa documents dated 17 August 1979 and 9 January 1981 were
falsified because it was made to appear that petitioners Virgilio and
Tadeo were present in the executions thereof, and their allegation that
even respondents Spouses Lumbaos witness Carolina Morales proved
that said petitioners were not present during the execution of the
aforementioned documents. This is specious.

Q. But that is your signature?


A. I dont have eyeglasses My signature is different.
Q. You

never
appeared
before
Apolinario Mangahas?

this

notary

public

A. I dont remember.[20]

Upon examination of the aforesaid documents, this Court finds


that in the Bilihan ng Lupa, dated 17 August 1979, the signatures of
petitioners Virgilio and Tadeo appeared thereon. Moreover, in
petitioners Answer and Amended Answer to the Complaint for
Reconveyance with Damages, both petitioners Virgilio and Tadeo
made an admission that indeed they acted as witnesses in the
execution of the Bilihan ng Lupa, dated 17 August 1979.[19] However,
in order to avoid their obligations in the said Bilihan ng Lupa,
petitioner Virgilio, in his cross-examination, denied having knowledge
of the sale transaction and claimed that he could not remember the
same as well as his appearance before the notary public due to the
length of time that had passed. Noticeably, petitioner Virgilio did not
categorically deny having signed the Bilihan ng Lupa, dated 17 August
1979 and in support thereof, his testimony in the cross-examination
propounded by the counsel of the respondents Spouses Lumbao is
quoted hereunder:

As a general rule, facts alleged in a partys pleading are


deemed admissions of that party and are binding upon him, but this is
not an absolute and inflexible rule. An answer is a mere statement of
fact which the party filing it expects to prove, but it is not evidence.
[21]
And in spite of the presence of judicial admissions in a partys
pleading, the trial court is still given leeway to consider other
evidence presented.[22] However, in the case at bar, as the Court of
Appeals mentioned in its Decision, [herein petitioners] had not
adduced any other evidence to override the admission made in their
[A]nswer that [petitioners Virgilio and Tadeo] actually signed the
[Bilihan ng Lupa dated 17 August 1979] except that they were just
misled as to the purpose of the document, x x x. [23] Virgilios answers
were unsure and quibbled. Hence, the general rule that the
admissions made by a party in a pleading are binding and conclusive
upon him applies in this case.

ATTY. CHIU:
Q. Now, you said, Mr. WitnessVirgilio Santos, that you dont know
about this document which was marked as Exhibit A for
the [respondents spouses Lumbao]?

On the testimony of respondents Spouses Lumbaos witness


Carolina Morales, this Court adopts the findings made by the appellate
court. Thus -

37

[T]he trial court gave singular focus on her reply to a


question during cross-examination if the [petitioners
Virgilio and Tadeo] were not with her and the vendor
[Rita] during the transaction. It must be pointed out
that earlier in the direct examination of said witness,
she confirmed that [respondents spouses Lumbao]
actually bought the lot from [Rita] (nagkabilihan). Said
witness positively identified and confirmed the two (2)
documents evidencing the sale in favor of
[respondents spouse Lumbao]. Thus, her subsequent
statement that the [petitioners Virgilio and Tadeo] were
not with them during the transaction does not
automatically imply that [petitioners Virgilio and Tadeo]
did not at any time sign as witnesses as to the deed of
sale attesting to their mothers voluntary act of selling
a portion of her share in her deceased mothers
property. The rule is that testimony of a witness must
be considered and calibrated in its entirety and not by
truncated portions thereof or isolated passages
therein.[24]

It is noteworthy that at the time of the execution of the


documents denominated as Bilihan ng Lupa, the entire property
owned by Maria, the mother of Rita, was not yet divided among her
and her co-heirs and so the description of the entire estate is the only
description that can be placed in the Bilihan ng Lupa, dated 17 August
1979 and 9 January 1981 because the exact metes and bounds of the
subject property sold to respondents Spouses Lumbao could not be
possibly determined at that time. Nevertheless, that does not make
the contract of sale between Rita and respondents Spouses Lumbao
invalid because both the law and jurisprudence have categorically
held that even while an estate remains undivided, co-owners have
each full ownership of their respective aliquots or undivided shares
and may therefore alienate, assign or mortgage them. [28] The coowner, however, has no right to sell or alienate a specific or
determinate part of the thing owned in common, because such right
over the thing is represented by an aliquot or ideal portion without
any physical division. In any case, the mere fact that the deed
purports to transfer a concrete portion does not per se render the sale
void. The sale is valid, but only with respect to the aliquot share of the
selling co-owner. Furthermore, the sale is subject to the results of the
partition upon the termination of the co-ownership.[29]

Furthermore, both Bilihan ng Lupa documents dated 17 August


1979 and 9 January 1981 were duly notarized before a notary
public. It is well-settled that a document acknowledged before a
notary public is a public document [25] that enjoys the presumption of
regularity. It is a prima facie evidence of the truth of the facts stated
therein and a conclusive presumption of its existence and due
execution.[26] To overcome this presumption, there must be presented
evidence that is clear and convincing. Absent such evidence, the
presumption must be upheld.[27] In addition, one who denies the due
execution of a deed where ones signature appears has the burden of
proving that contrary to the recital in the jurat, one never appeared
before the notary public and acknowledged the deed to be a voluntary
act. Nonetheless, in the present case petitioners denials without clear
and convincing evidence to support their claim of fraud and falsity
were not sufficient to overthrow the above-mentioned presumption;
hence, the authenticity, due execution and the truth of the facts
stated in the aforesaid Bilihan ng Lupa are upheld.

In the case at bar, when the estate left by Maria had been
partitioned on 2 May 1986 by virtue of a Deed of Extrajudicial
Settlement, the 107- square meter lot sold by the mother of the
petitioners to respondents Spouses Lumbao should be deducted from
the total lot, inherited by them in representation of their deceased
mother, which in this case measures 467 square meters. The 107square meter lot already sold to respondents Spouses Lumbao can no
longer be inherited by the petitioners because the same was no
longer part of their inheritance as it was already sold during the
lifetime of their mother.
Likewise, the fact that the property mentioned in the
two Bilihan ng Lupa documents was described as a portion of a parcel
of land covered in Tax Declarations No. A-018-01674, while the subject
matter of the Deed of Extrajudicial Settlement was the property
described in Transfer Certificate of Title (TCT) No. 3216 of the Registry
of Deeds of the Province of Rizal in the name of Maria is of no moment
because in the Bilihan ng Lupa, dated 17 August 1979 and 9 January
1981, it is clear that there was only one estate left by Maria upon her
death. And this fact was not refuted by the petitioners. Besides, the
property described in Tax Declaration No. A-018-01674 and the
property mentioned in TCT No. 3216 are both located in Barrio
Rosario, Municipality of Pasig, Province of Rizal, and almost have the
same boundaries. It is, thus, safe to state that the property mentioned

The defense of petitioners that the identities of the properties


described in the Bilihan ng Lupa, dated 17 August 1979 and 9 January
1981 in relation to the subject property were not established by
respondents Spouses Lumbaos evidence is likewise not acceptable.

38

in Tax Declaration No. A-018-01674 and in TCT No. 3216 are one and
the same.

Hence, the Bilihan ng Lupa documents dated 17 August 1979 and 9


January 1981, being valid and enforceable, herein petitioners are
bound to comply with their provisions. In short, such documents are
absolutely valid between and among the parties thereto.
Finally, the general rule that heirs are bound by contracts
entered into by their predecessors-in-interest applies in the present
case. Article 1311[32] of the NCC is the basis of this rule. It is clear from
the said provision that whatever rights and obligations the decedent
have over the property were transmitted to the heirs by way of
succession, a mode of acquiring the property, rights and obligations of
the decedent to the extent of the value of the inheritance of the heirs.
[33]
Thus, the heirs cannot escape the legal consequence of a
transaction entered into by their predecessor-in-interest because they
have inherited the property subject to the liability affecting their
common ancestor. Being heirs, there is privity of interest between
them and their deceased mother. They only succeed to what rights
their mother had and what is valid and binding against her is also
valid and binding as against them. The death of a party does not
excuse nonperformance of a contract which involves a property right
and the rights and obligations thereunder pass to the personal
representatives of the deceased. Similarly, nonperformance is not
excused by the death of the party when the other party has a
property interest in the subject matter of the contract.[34]
[31]

The defense of prescription of action and laches is likewise


unjustifiable. In an action for reconveyance, the decree of registration
is respected as incontrovertible. What is sought instead is the transfer
of the property or its title which has been wrongfully or erroneously
registered in another persons name to its rightful or legal owner, or to
the one with a better right. It is, indeed, true that the right to seek
reconveyance of registered property is not absolute because it is
subject to extinctive prescription. However, when the plaintiff is in
possession of the land to be reconveyed, prescription cannot
set in. Such an exception is based on the theory that registration
proceedings could not be used as a shield for fraud or for enriching a
person at the expense of another.[30]
In the case at bar, the right of the respondents Spouses
Lumbao to seek reconveyance does not prescribe because the latter
have been and are still in actual possession and occupation as owners
of the property sought to be reconveyed, which fact has not been
refuted nor denied by the petitioners. Furthermore, respondents
Spouses Lumbao cannot be held guilty of laches because from the
very start that they bought the 107-square meter lot from the mother
of the petitioners, they have constantly asked for the transfer of the
certificate of title into their names but Rita, during her lifetime, and
the petitioners, after the death of Rita, failed to do so on the flimsy
excuse that the lot had not been partitioned yet. Inexplicably, after
the partition of the entire estate of Maria, petitioners still included the
107-square meter lot in their inheritance which they divided among
themselves despite their knowledge of the contracts of sale between
their mother and the respondents Spouses Lumbao.

In the end, despite the death of the petitioners mother, they


are still bound to comply with the provisions of the Bilihan ng Lupa,
dated 17 August 1979 and 9 January 1981. Consequently, they must
reconvey to herein respondents Spouses Lumbao the 107-square
meter lot which they bought from Rita, petitioners mother. And as
correctly ruled by the appellate court, petitioners must pay
respondents Spouses Lumbao attorneys fees and litigation expenses
for having been compelled to litigate and incur expenses to protect
their interest.[35] On this matter, we do not find reasons to reverse the
said findings.

Under the above premises, this Court holds that the Bilihan
ng Lupa documents dated 17 August 1979 and 9 January 1981 are
valid and enforceable and can be made the basis of the respondents
Spouses Lumbaos action for reconveyance. The failure of respondents
Spouses Lumbao to have the said documents registered does not
affect
its
validity
and
enforceability. It
must
be
remembered that registration is not a requirement for validity of the
contract as between the parties, for the effect of registration serves
chiefly to bind third persons. The principal purpose of registration is
merely to notify other persons not parties to a contract that a
transaction involving the property had been entered into. Where the
party has knowledge of a prior existing interest which is unregistered
at the time he acquired a right to the same land, his knowledge of
that prior unregistered interest has the effect of registration as to him.

WHEREFORE, premises considered, the instant Petition is


hereby DENIED. The Decision and Resolution of the Court of Appeals
dated 8
June
2005 and 29
July
2005,
respectively,
are
hereby AFFIRMED. Herein petitioners are ordered to reconvey to
respondents Spouses Lumbao the subject property and to pay the
latter attorneys fees and litigation expenses. Costs against
petitioners.
SO ORDERED.

39

PARISUKAT ang laki, humigit kumulang, at makikilala sa tawag na Lote


17, Bloke 55, at pag-aari ng Land Tenure Administration;
2. Na ang nasabing lote ay aking binibile, sa pamamagitan ng
paghuhulog sa Land Tenure Administration, at noong ika 30 ng Julio,
1959, ang Kasunduang sa Pagbibile (AGREEMENT TO SELL No. 3787)
ay ginawa at pinagtibay sa Lungsod ng Maynila, sa harap ng Notario
Publico na si G. Jose C. Tolosa, at lumalabas sa kaniyang Libro Notarial
bilang Documento No. 13, Pagina No. 4; Libro No. IV, Serie ng 1959;
3. Na dahilan sa ako'y matanda na at walang ano mang hanap buhay,
ako ay nakatira at pinagsisilbihan nang aking anak na si Francisca
Herrera, at ang tinitirikan o solar na nasasabi sa unahan ay
binabayaran ng kaniyang sariling cuarta sa Land Tenure
Administration;
4. Na alang-alang sa nasasaysay sa unahan nito, sakaling ako'y
bawian na ng Dios ng aking buhay, ang lupang nasasabi sa unahan ay
aking ipinagkakaloob sa nasabi kong anak na FRANCISCA HERRERA,
Filipina, nasa katamtamang gulang, kasal kay Macario Berroya,
kasalukuyang naninirahan at tumatanggap ng sulat sa Nayong ng San
Vicente, San Pedro Laguna, o sa kaniyang mga tagapagmana at;
5. Na HINIHILING KO sa sino man kinauukulan, na sakaling ako nga ay
bawian na ng Dios ng aking buhay ay KILALANIN, IGALANG at
PAGTIBAYIN ang nilalaman sa pangalan ng aking anak na si Francisca
Herrera ang loteng nasasabi sa unahan.
SA KATUNAYAN NG LAHAT, ako ay nag-didiit ng hinlalaki ng kanan
kong kamay sa ibaba nito at sa kaliwang gilid ng unang dahon, dito sa
Lungsod ng Maynila, ngayong ika 7 ng Octubre, 1960.4
The said document was signed by two witnesses and notarized. The
witnesses signed at the left-hand side of both pages of the document
with the said document having 2 pages in total. Margarita Herrera
placed her thumbmark5 above her name in the second page and at
the left-hand margin of the first page of the document.
The surviving heirs of Beatriz Herrera-Mercado filed a case for
annulment of the Deed of Self-Adjudication before the then Court of
First Instance of Laguna, Branch 1 in Binan, Laguna (now, Regional
Trial Court Branch 25). The case for annulment was docketed as Civil
Case No. B-1263.6
On December 29, 1980, a Decision in Civil Case No. B-1263
(questioning the Deed of Self-Adjudication) was rendered and the
deed was declared null and void.7
During trial on the merits of the case assailing the Deed of SelfAdjudication, Francisca Herrera filed an application with the NHA to
purchase the same lots submitting therewith a copy of the

G.R. No. 162784


June 22, 2007
NATIONAL HOUSING AUTHORITY, petitioner,
vs.
SEGUNDA ALMEIDA, COURT OF APPEALS, and RTC of SAN
PEDRO, LAGUNA, BR. 31, respondents.
DECISION
PUNO, C.J.:
This is a Petition for Review on Certiorari under Rule 45 filed by the
National Housing Authority (NHA) against the Court of Appeals, the
Regional Trial Court of San Pedro Laguna, Branch 31, and private
respondent Segunda Almeida.
On June 28, 1959, the Land Tenure Administration (LTA) awarded to
Margarita Herrera several portions of land which are part of the
Tunasan Estate in San Pedro, Laguna. The award is evidenced by an
Agreement to Sell No. 3787. 1 By virtue of Republic Act No. 3488, the
LTA was succeeded by the Department of Agrarian Reform (DAR). On
July 31, 1975, the DAR was succeeded by the NHA by virtue of
Presidential Decree No. 757. 2 NHA as the successor agency of LTA is
the petitioner in this case.
The records show that Margarita Herrera had two children: Beatriz
Herrera-Mercado (the mother of private respondent) and Francisca
Herrera. Beatriz Herrera-Mercado predeceased her mother and left
heirs.
Margarita Herrera passed away on October 27, 1971.3
On August 22, 1974, Francisca Herrera, the remaining child of the late
Margarita Herrera executed a Deed of Self-Adjudication claiming that
she is the only remaining relative, being the sole surviving daughter
of the deceased. She also claimed to be the exclusive legal heir of the
late Margarita Herrera.
The Deed of Self-Adjudication was based on a Sinumpaang Salaysay
dated October 7, 1960, allegedly executed by Margarita Herrera. The
pertinent portions of which are as follows:
SINUMPAANG SALAYSAY
SA SINO MAN KINAUUKULAN;
Akong si MARGARITA HERRERA, Filipina, may 83 taong gulang, balo,
kasalukuyang naninirahan at tumatanggap ng sulat sa Nayon ng San
Vicente, San Pedro Laguna, sa ilalim ng panunumpa ay malaya at
kusang loob kong isinasaysay at pinagtitibay itong mga sumusunod:
1. Na ako ay may tinatangkilik na isang lagay na lupang tirikan
(SOLAR), tumatayo sa Nayon ng San Vicente, San Pedro, Laguna,
mayroong PITONG DAAN AT PITUMPU'T ISANG (771) METRONG

40

"Sinumpaang Salaysay" executed by her mother. Private respondent


Almeida, as heir of Beatriz Herrera-Mercado, protested the application.
In a Resolution8 dated February 5, 1986, the NHA granted the
application made by Francisca Herrera, holding that:
From the evidence of the parties and the records of the lots in
question, we gathered the following facts: the lots in question are
portions of the lot awarded and sold to the late Margarita Herrera on
July 28, 1959 by the defunct Land Tenure Administration; protestant is
the daughter of the late Beatriz Herrera Mercado who was the sister of
the protestee; protestee and Beatriz are children of the late Margarita
Herrera; Beatriz was the transferee from Margarita of Lot Nos. 45, 46,
47, 48 and 49, Block 50; one of the lots transferred to Beatriz, e.g. Lot
47, with an area of 148 square meters is in the name of the
protestant; protestant occupied the lots in question with the
permission of the protestee; protestee is a resident of the Tunasan
Homesite since birth; protestee was born on the lots in question;
protestee left the place only after marriage but resided in a lot
situated in the same Tunasan Homesite; her (protestee) son Roberto
Herrera has been occupying the lots in question; he has been there
even before the death of the late Margarita Herrera; on October 7,
1960, Margarita Herrera executed a "Sinumpaang Salaysay"
whereby she waived or transferred all her rights and interest
over the lots in question in favor of the protestee; and
protestee had paid the lots in question in full on March 8, 1966 with
the defunct Land Tenure Administration.
This Office finds that protestee has a better preferential right to
purchase the lots in question.9
Private respondent Almeida appealed to the Office of the
President.10 The NHA Resolution was affirmed by the Office of the
President in a Decision dated January 23, 1987.11
On February 1, 1987, Francisca Herrera died. Her heirs executed an
extrajudicial settlement of her estate which they submitted to the
NHA. Said transfer of rights was approved by the NHA. 12 The NHA
executed several deeds of sale in favor of the heirs of Francisca
Herrera and titles were issued in their favor. 13 Thereafter, the heirs of
Francisca Herrera directed Segunda Mercado-Almeida to leave the
premises that she was occupying.
Feeling aggrieved by the decision of the Office of the President and
the resolution of the NHA, private respondent Segunda MercadoAlmeida sought the cancellation of the titles issued in favor of the
heirs of Francisca. She filed a Complaint on February 8, 1988, for

"Nullification of Government Lot's Award," with the Regional Trial


Court of San Pedro, Laguna, Branch 31.
In her complaint, private respondent Almeida invoked her forty-year
occupation of the disputed properties, and re-raised the fact that
Francisca Herrera's declaration of self-adjudication has been adjudged
as a nullity because the other heirs were disregarded. The defendant
heirs of Francisca Herrera alleged that the complaint was barred by
laches and that the decision of the Office of the President was already
final and executory.14 They also contended that the transfer of
purchase of the subject lots is perfectly valid as the same was
supported by a consideration and that Francisca Herrera paid for the
property with the use of her own money.15 Further, they argued that
plaintiff's occupation of the property was by mere tolerance and that
they had been paying taxes thereon.16
The Regional Trial Court issued an Order dated June 14, 1988
dismissing the case for lack of jurisdiction. 17 The Court of Appeals in a
Decision dated June 26, 1989 reversed and held that the Regional Trial
Court had jurisdiction to hear and decide the case involving "title and
possession to real property within its jurisdiction." 18 The case was then
remanded for further proceedings on the merits.
A pre-trial was set after which trial ensued.
On March 9, 1998, the Regional Trial Court rendered a Decision setting
aside the resolution of the NHA and the decision of the Office of the
President awarding the subject lots in favor of Francisca Herrera. It
declared the deeds of sale executed by NHA in favor of Herrera's heirs
null and void. The Register of Deeds of Laguna, Calamba Branch was
ordered to cancel the Transfer Certificate of Title issued. Attorney's
fees were also awarded to private respondent.
The Regional Trial Court ruled that the "Sinumpaang Salaysay" was
not an assignment of rights but a disposition of property which shall
take effect upon death. It then held that the said document must first
be submitted to probate before it can transfer property.
Both the NHA and the heirs of Francisca Herrera filed their respective
motions for reconsideration which were both denied on July 21, 1998
for lack of merit. They both appealed to the Court of Appeals. The
brief for the heirs of Francisca Herrera was denied admission by the
appellate court in a Resolution dated June 14, 2002 for being a
"carbon copy" of the brief submitted by the NHA and for being filed
seventy-nine (79) days late.
On August 28, 2003, the Court of Appeals affirmed the decision of the
Regional Trial Court, viz:

41

There is no dispute that the right to repurchase the subject lots was
awarded to Margarita Herrera in 1959. There is also no dispute that
Margarita executed a "Sinumpaang Salaysay" on October 7, 1960.
Defendant NHA claims that the "Sinumpaang Salaysay" is, in effect, a
waiver or transfer of rights and interest over the subject lots in favor
of Francisca Herrera. This Court is disposed to believe otherwise. After
a perusal of the "Sinumpaang Salaysay" of Margarita Herrera, it can
be ascertained from its wordings taken in their ordinary and
grammatical sense that the document is a simple disposition of her
estate to take effect after her death. Clearly the Court finds that the
"Sinumpaang Salaysay" is a will of Margarita Herrera. Evidently, if the
intention of Margarita Herrera was to merely assign her right over the
lots to her daughter Francisca Herrera, she should have given her
"Sinumpaang Salaysay" to the defendant NHA or to Francisca Herrera
for submission to the defendant NHA after the full payment of the
purchase price of the lots or even prior thereto but she did not. Hence
it is apparent that she intended the "Sinumpaang Salaysay" to be her
last will and not an assignment of rights as what the NHA in its
resolution would want to make it appear. The intention of Margarita
Herrera was shared no less by Francisca Herrera who after the
former's demise executed on August 22, 1974 a Deed of SelfAdjudication claiming that she is her sole and legal heir. It was only
when said deed was questioned in court by the surviving heirs of
Margarita Herrera's other daughter, Beatriz Mercado, that Francisca
Herrera filed an application to purchase the subject lots and presented
the "Sinumpaang Salaysay" stating that it is a deed of assignment of
rights.19
The Court of Appeals ruled that the NHA acted arbitrarily in awarding
the lots to the heirs of Francisca Herrera. It upheld the trial court
ruling that the "Sinumpaang Salaysay" was not an assignment of
rights but one that involved disposition of property which shall take
effect upon death. The issue of whether it was a valid will must first
be determined by probate.
Petitioner NHA elevated the case to this Court.
Petitioner NHA raised the following issues:
A. WHETHER OR NOT THE RESOLUTION OF THE NHA AND THE
DECISION OF THE OFFICE OF THE PRESIDENT HAVE ATTAINED
FINALITY, AND IF SO, WHETHER OR NOT THE PRINCIPLE OF
ADMINISTRATIVE RES JUDICATABARS THE COURT FROM FURTHER
DETERMINING WHO BETWEEN THE PARTIES HAS PREFERENTIAL
RIGHTS FOR AWARD OVER THE SUBJECT LOTS;

B. WHETHER OR NOT THE COURT HAS JURISDICTION TO MAKE THE


AWARD ON THE SUBJECT LOTS; AND
C. WHETHER OR NOT THE AWARD OF THE SUBJECT LOTS BY THE NHA
IS ARBITRARY.
We rule for the respondents.
Res judicata is a concept applied in review of lower court decisions in
accordance with the hierarchy of courts. But jurisprudence has also
recognized the rule of administrative res judicata: "the rule which
forbids the reopening of a matter once judicially determined by
competent authority applies as well to the judicial and quasi-judicial
facts of public, executive or administrative officers and boards acting
within their jurisdiction as to the judgments of courts having general
judicial powers . . . It has been declared that whenever final
adjudication of persons invested with power to decide on the property
and rights of the citizen is examinable by the Supreme Court, upon a
writ of error or a certiorari, such final adjudication may be pleaded
as res judicata."20 To be sure, early jurisprudence were already mindful
that the doctrine of res judicata cannot be said to apply exclusively to
decisions rendered by what are usually understood as courts without
unreasonably circumscribing the scope thereof and that the more
equitable attitude is to allow extension of the defense to decisions of
bodies upon whom judicial powers have been conferred.
In Ipekdjian Merchandising Co., Inc. v. Court of Tax
Appeals,21 the Court held that the rule prescribing that
"administrative orders cannot be enforced in the courts in the
absence of an express statutory provision for that purpose" was
relaxed in favor of quasi-judicial agencies.
In fine, it should be remembered that quasi-judicial powers will always
be subject to true judicial powerthat which is held by the courts.
Quasi-judicial power is defined as that power of adjudication of an
administrative agency for the "formulation of a final order."22 This
function applies to the actions, discretion and similar acts of public
administrative officers or bodies who are required to investigate facts,
or ascertain the existence of facts, hold hearings, and draw
conclusions from them, as a basis for their official action and to
exercise discretion of a judicial nature. 23 However, administrative
agencies are not considered courts, in their strict sense. The doctrine
of separation of powers reposes the three great powers into its three
(3) branchesthe legislative, the executive, and the judiciary. Each
department is co-equal and coordinate, and supreme in its own
sphere. Accordingly, the executive department may not, by its own
fiat, impose the judgment of one of its agencies, upon the judiciary.

42

Indeed, under the expanded jurisdiction of the Supreme Court, it is


empowered to "determine whether or not there has been grave abuse
of discretion amounting to lack or excess of jurisdiction on the part of
any branch or instrumentality of the Government."24Courts have an
expanded role under the 1987 Constitution in the resolution of
societal conflicts under the grave abuse clause of Article VIII which
includes that duty to check whether the other branches of
government committed an act that falls under the category of grave
abuse of discretion amounting to lack or excess of jurisdiction.25
Next, petitioner cites Batas Pambansa Blg. 129 or the Judiciary
Reorganization Act of 198026 where it is therein provided that the
Intermediate Appellate Court (now, Court of Appeals) shall exercise
the "exclusive appellate jurisdiction over all final judgments,
decisions, resolutions, orders or awards, of the Regional Trial Courts
and Quasi-Judicial agencies, instrumentalities, boards or commissions,
except those falling within the jurisdiction of the Supreme Court in
accordance with the Constitution"27 and contends that the Regional
Trial Court has no jurisdiction to rule over awards made by the NHA.
Well-within its jurisdiction, the Court of Appeals, in its decision of
August 28, 2003, already ruled that the issue of the trial court's
authority to hear and decide the instant case has already been settled
in the decision of the Court of Appeals dated June 26, 1989 (which has
become final and executory on August 20, 1989 as per entry of
judgment dated October 10, 1989). 28 We find no reason to disturb this
ruling. Courts are duty-bound to put an end to controversies. The
system of judicial review should not be misused and abused to evade
the operation of a final and executory judgment. 29 The appellate
court's decision becomes the law of the case which must be adhered
to by the parties by reason of policy.30
Next, petitioner NHA contends that its resolution was grounded on
meritorious grounds when it considered the application for the
purchase of lots. Petitioner argues that it was the daughter Francisca
Herrera who filed her application on the subject lot; that it considered
the respective application and inquired whether she had all the
qualifications and none of the disqualifications of a possible awardee.
It is the position of the petitioner that private respondent possessed
all the qualifications and none of the disqualifications for lot award
and hence the award was not done arbitrarily.
The petitioner further argues that assuming that the "Sinumpaang
Salaysay" was a will, it could not bind the NHA. 31 That, "insofar as
[the] NHA is concerned, it is an evidence that the subject lots were

indeed transferred by Margarita Herrera, the original awardee, to


Francisca Herrera was then applying to purchase the same before it."32
We are not impressed. When the petitioner received the "Sinumpaang
Salaysay," it should have noted that the effectivity of the said
document commences at the time of death of the author of the
instrument; in her words "sakaling ako'y bawian na ng Dios ng aking
buhay" Hence, in such period, all the interests of the person should
cease to be hers and shall be in the possession of her estate until they
are transferred to her heirs by virtue of Article 774 of the Civil Code
which provides that:
Art. 774. Succession is a mode of acquisition by virtue of which the
property, rights and obligations to the extent of the value of the
inheritance, of a person are transmitted through his death to
another or others either by his will or by operation of law.33
By considering the document, petitioner NHA should have noted that
the original applicant has already passed away. Margarita Herrera
passed away on October 27, 1971.34 The NHA issued its resolution35 on
February 5, 1986. The NHA gave due course to the application made
by Francisca Herrera without considering that the initial applicant's
death would transfer all her property, rights and obligations to the
estate including whatever interest she has or may have had over the
disputed properties. To the extent of the interest that the original
owner had over the property, the same should go to her estate.
Margarita Herrera had an interest in the property and that interest
should go to her estate upon her demise so as to be able to properly
distribute them later to her heirsin accordance with a will or by
operation of law.
The death of Margarita Herrera does not extinguish her interest over
the property. Margarita Herrera had an existing Contract to Sell 36 with
NHA as the seller. Upon Margarita Herrera's demise, this Contract to
Sell was neither nullified nor revoked. This Contract to Sell was an
obligation on both partiesMargarita Herrera and NHA. Obligations
are transmissible.37Margarita Herrera's obligation to pay became
transmissible at the time of her death either by will or by operation of
law.
If we sustain the position of the NHA that this document is not a will,
then the interests of the decedent should transfer by virtue of an
operation of law and not by virtue of a resolution by the NHA. For as it
stands, NHA cannot make another contract to sell to other parties of a
property already initially paid for by the decedent. Such would be an
act contrary to the law on succession and the law on sales and
obligations.38

43

When the original buyer died, the NHA should have considered the
estate of the decedent as the next "person"39 likely to stand in to fulfill
the obligation to pay the rest of the purchase price. The opposition of
other heirs to the repurchase by Francisca Herrera should have put
the NHA on guard as to the award of the lots. Further, the Decision in
the said Civil Case No. B-1263 (questioning the Deed of SelfAdjudication) which rendered the deed therein null and void 40 should
have alerted the NHA that there are other heirs to the interests and
properties of the decedent who may claim the property after a testate
or intestate proceeding is concluded. The NHA therefore acted
arbitrarily in the award of the lots.
We need not delve into the validity of the will. The issue is for the
probate court to determine. We affirm the Court of Appeals and the
Regional Trial Court which noted that it has an element of
testamentary disposition where (1) it devolved and transferred
property; (2) the effect of which shall transpire upon the death of the
instrument maker.41
IN VIEW WHEREOF, the petition of the National Housing Authority is
DENIED. The decision of the Court of Appeals in CA-G.R. No. 68370
dated August 28, 2003, affirming the decision of the Regional Trial
Court of San Pedro, Laguna in Civil Case No. B-2780 dated March 9,
1998, is hereby AFFIRMED.
No cost.
SO ORDERED.
Sandoval-Gutierrez, Corona, Azcuna, Garcia, JJ., concur.
Footnotes
1
Rollo, at 8.
2
A Decree Creating the National Housing Authority and Dissolving the
Existing Housing Agencies, Defining Its Powers and Functions,
Providing Funds Therefor, and for Other Purposes, Presidential Decree
No. 757, promulgated July 31, 1975.
3
Rollo, at 70.
4
Id.
5
It should be noted that a thumbmark is considered a valid signature.
As held in Payad v. Tolentino, 62 Phil. 848 (1936): "The testator's
thumbprint is always valid and sufficient signature for the purpose of
complying with the requirement of the article. While in most of these
cases, the testator was suffering from some infirmity which made the
writing of the testator's name difficult or impossible, there seems to
be no basis for limiting the validity of thumbprints only to cases of
illness or infirmity."
6
Rollo, at 49.

Vol. 1, Original Record, at 11-14.


Rollo, at 39-43.
9
Id., at 41-42 (emphasis supplied).
10
Id., at 9.
11
Id., at 9, 44-47.
12
Id., at 9.
13
Id., at 25-26. Francisca Herrera left behind her husband, Macario
Berroya, and children: Ramon, Antonio, Alberto, Rosita, Pacita,
Bernabe, Gregorio, Josefina and Rustica. In the extra judicial
settlement made by the said heirs, Rosita, Pacita, Bernabe, Gregorio,
Josefina and Rustica waived all their rights, interest and participation
therein in favor of their siblings Macario, Alberto, Ramon and Antonio.
Deeds of sale involving the subject lots were executed by the NHA in
favor of Alberto, Antonio and Macario. Hence, TCT Nos. T-173557, T173579, T-173578 and T-183166 were issued to Macario, Alberto and
Antonio, respectively.
14
Id., at 27.
15
Id., at 27-28.
16
Id., at 28.
17
Id., at 5.
18
Id., at 6; see Annex "F."
19
Id., at 71-72.
20
Brillantes v. Castro, 99 Phil. 497, 503 (1956).
21
G.R. No. L-14791, September 30, 1963, 9 SCRA 75.
22
Administrative Code of 1987, Executive Order No. 292, Bk. VIII, ch.
1, 2(9).
23
Midland Insurance Corp. v. IAC, G.R. No. L-71905, August 13, 1986,
143 SCRA 458, 462.
24
1987 Phil. Const., art. VIII, 1 as explained in United Residents of
Dominical Hills, Inc. v. Commission on Settlement of Land
Problems, G.R. No. 135945, March 7, 2001, 353 SCRA 783, 797-798.
25
1987 Phil. Const., art. VIII, 1 2.
26
An Act Reorganizing the Judiciary, Appropriating Funds Therefor and
for Other Purposes, Batas Pambansa Blg. 129, promulgated August
14, 1981.
G.R. No. L-5803
November 29, 1954
THE PEOPLE OF THE PHILIPPINES, plaintiff-appellee,
vs.
NARCISO UMALI, ET AL., defendants.
NARCISO UMALI, EPIFANIO PASUMBAL and ISIDRO
CAPINO, defendants-appellants.
7
8

44

Jose P. Laurel, Cipriano Primicias, Alejo Mabanag, Manuel Concordia,


P.M. Stuart Del Rosario, Tomas R. Umali, Eufemio E. De Mesa and
Edmundo T. Zepeda for appellants.
Solicitor General Juan R. Liwag and Solicitor Martiniano P. Vivo for
appellee.
MONTEMAYOR, J.:
Narciso Umali, Epifanio Pasumbal, and Isidro Capino are appealing
directly to this Tribunal from a decision of the Court of First Instance of
Quezon province finding them guilty of the complex crime of rebellion
with multiple murder, frustrated murder, arson and robbery, and
sentencing each of them to "life imprisonment, other accessories of
the law, to indemnify jointly and severally Marcial Punsalan in the
amount of P24,023; Valentin Robles in the amount of P10,000; Yao
Cabon in the amount of P700; Claro Robles in the amount of P12,800;
Pocho Guan in the amount of P600; the heirs of Domingo Pisigan in
the amount of P6,000; the heirs of Locadio Untalan in the amount of
P6,000; Patrolman Pedro Lacorte in the amount of P500; Lazaro
Ortega in the amount of P300; Hilarion Aselo in the amount of P300;
Calixto Rivano in the amount P50; Melecio Garcia in the amount of
P60; and Juanito Lector in the amount of P90, each to pay one
fifteenth of the costs, without subsidiary imprisonment in case of
insolvency due to the nature of the principal penalty that is imposed
upon them."
The complex crime of which appellants were found guilty was said to
have been committed during the raid staged in the town of Tiaong,
Quezon, between 8:00 and 9:00 in the evening of November 14, 1951,
by armed men. It is not denied that such a raid took place resulting in
the burning down and complete destruction of the house of Mayor
Marcial Punzalan including its content valued at P24,023; the house of
Valentin Robles valued at P10,000, and the house of one Mortega, the
death of Patrolman Domingo Pisigan and civilians Vicente Soriano and
Leocadio Untalan, and the wounding of Patrolman Pedro Lacorte and
five civilians; that during and after the burning of the houses, some of
the raiders engaged in looting, robbing one house and two Chinese
stories; and that the raiders were finally dispersed and driven from
the town by the Philippine Army soldiers stationed in the town led by
Captain Alzate.
To understand the reason for and object of the raid we have to go into
the political situation in Tiaong not only shortly before that raid but
one year or two years before it. Narciso Umali and Marcial Punzalan
were old time friends and belonged to the same political faction. In
the general elections of 1947 Umali campaigned for Punzalan who

later was elected Mayor of Tiaong. In the elections of 1949 Punzalan in


his turn campaigned and worked for Narciso Umali resulting in the
latter's election as Congressman. However, these friendly relations
between the two did not endure. In the words of Punzalan, Narciso
Umali who as Congressman regarded himself as the political head and
leader in that region including Tiaong, became jealous because of his
(Punzalan's) fast growing popularity among the people of Tiaong who
looked to him instead of Umali for political guidance, leadership, and
favors. In time the strain in their relations became such that they
ceased to have any dealings with each other and they even filed
mutual accusations. According to Punzalan, in May 1950, Umali
induced about twenty-six special policemen of his (Punzalan's) to flee
to the mountains with their arms and join the Huks, this is in order to
discredit Punzalan's administration; that he was later able to contact
two of his twenty-six policemen and tried to persuade them to return
to the town and to the service, but they told him that they and their
companions would not surrender except and with through the
intervention of Congressman Umali, and so Punzalan had to seek
Umali's intervention which resulted in the surrender of the 26 men
with their firearms; that thereafter Umali wanted to have their
firearms, claiming that they all belonged to him from his guerrilla days
when he was a colonel, and that after liberation he had merely loaned
them to the municipal authorities of Tiaong to help keep peace and
order; and that the refusal of Punzalan to grant Umali's request
further strained their relations, and thereafter Umali would not speak
to him even when they happened to meet at parties.
On September 19, 1951, the Chief of Police of Punzalan disarmed four
of Umali's men, including his bodyguard Isidro Capino who were then
charged with illegal possession of firearms. Umali interceded for his
men and Col. Gelveson, Provincial Commander, sent a telegram
stating that the firearms taken away from the men were licensed. As a
result the complaint was dismissed. This incident was naturally
resented by Umali and spurred him to have a showdown with
Punzalan.
Then the elections of 1951 (November 13) approached and Punzalan
ran for reelection. To oppose him, and to clip his political wings and
definitely blast his ambition for continued power and influence in
Tiaong, Umali picked Epifanio Pasumbal, his trusted leader.
The pre-election campaign and fight waged by both factions
Punzalan and Pasumbal, was intense and bitter, even ruthless. The
election was to be a test of political strength and would determine
who was who in Tiaong, Umali or Punzalan. Umali spoke at political

45

meetings, extolling the virtues of Pasumbal and the benefits and


advantages that would accrue to the town if he was elected, at the
same time bitterly attacking Punzalan, accusing him of dishonesty,
corruption in office, abuse of power, etc. At one of those meetings he
told the audience not to vote for Punzalan because he would not be
elected and that even if he won the election, he would not sit for
blood will flow, and that he (Umali) had already prepared a golden
coffin for him (Punzalan). After denying the charges, in retort,
Punzalan would say that Umali as a Congressman was useless, and
that he did not even attend the sessions and that his chair in
Congress had gathered dust, even cobwebs.
To help in the Umali-Pasumbal campaign, Amado Mendoza who later
was to play the role of star witness for the prosecution, was drafted.
He was a compadre of Pasumbal and had some experience in political
campaigns, and although he was not exactly a model citizen, being
sometimes given to drunkenness, still, he had the gift of speech and
persuasion. In various political meetings he delivered speeches for
Pasumbal. He was ever at the back and call of Umali and Pasumbal,
and naturally he frequented the latter's houses or headquarters. The
result of the elections plainly showed that Punzalan was the political
master and leader in Tiaong. He beat Pasumbal by an overwhelming
majority of 2,221 votes. Naturally, Umali and Pasumbal were keenly
disappointed, and according to the evidence, adopted measures
calculated to frustrate Punzalan's victory, even as prophesied by
Umali himself in one of his pre-election speeches about blood flowing
and gold coffin.
Going back to the raid staged in Tiaong on November 14, 1951, it is
well to make a short narration of the happenings shortly before it,
established by the evidence, so as to ascertain and be informed of the
reason or purpose of said raid, the persons, behind it, and those who
took part in it. According to the testimony of Amado Mendoza, in the
morning of November 12th, that is, on the eve of the election, at the
house of Pasumbal's father, then being used as his electoral
headquarters, he heard Umali instruct Pasumbal to contact the Huks
through Commander Abeng so that Punzalan will be killed, Pasumbal
complying with the order of his Chief (Umali) went to the mountains
which were quite near the town and held a conference with
Commander Abeng. It would seem that Umali and Pasumbal had a
feeling that Punzalan was going to win in the elections the next day,
and that his death was the surest way to eliminate him from the
electoral fight.

The conference between Pasumbal and Commander Abeng on


November 12th was witnessed and testified to by Nazario Anonuevo,
a Huk who was under Commander Abeng, and who later took an
active part in the raid. In the evening of the same day, Mendoza heard
Pasumbal report to Umali about his conference with Commander
Abeng, saying that the latter was agreeable to the proposition and
had even outlined the manner of attack, that the Huks would enter
the town (Tiaong) under Commander Lucio and Aladin, the latter to
lead the sector towards the East; but that Commander Abeng had
suggested that the raid be postponed because Pasumbal may yet win
the election the following day, thereby rendering unnecessary the raid
and the killing of Punzalan.
Continuing with the testimony of Amado Mendoza, he told the court
that as per instructions of Umali he went to the house of the latter, in
the evening of November 14th, the day following the election, with
the result of the election already known, namely, the decisive victory
of Punzalan over Pasumbal. He was told by Umali to come with him,
and Pasumbal and the three boarded a jeep with Pasumbal at the
wheel. They drove toward the Tiaong Elementary School and once
there he (Mendoza) was left at the school premises with instructions
by Umali to wait for Commander Abeng and the Huks and point to
them the house of Punzalan. After waiting for sometime, Abeng and
his troops numbering about fifty, armed with garands and carbines,
arrived and after explaining his identity and his mission to Abeng, he
had led the dissidents or part of the contingent in the direction of
Punzalan's house and on arriving in front of the bodega of Robles, he
pointed out Punzalan's house and then walked toward his home,
leaving the Huks who proceeded to lie flat in a canal. Before reaching
his house, he already heard shots, so, he evacuated his family to their
dugout in his yard. While doing so he and his wife Catalina Tinapunan
saw armed men in the lanzones grove just across the street from their
house, belonging to the father of Umali, and among those men they
saw Congressman Umali holding a revolver, in the company of Huk
Commander Torio and about 20 armed men. Afterwards they saw
Umali and his companions leave in the direction of Taguan, by way of
the railroad tracks.
It would appear from the evidence that the raid was well-planned. As
a diversionary measure, part of the attacking force was deployed
toward the camp or station of the Army (part of 8th B.C.T.) in the
suburbs and the camp was fired upon, not exactly to destroy or drive
out that Army unit but to keep it from going to the rescue and aid of
the main objective of the raid. The rest of the raiding party went

46

toward Punzalan's house and attacked it with automatic weapons,


hand grenades, and even with bottles filled with gasoline (popularly
known as Molotov's cocktail). It was evident that the purpose of the
attack on Punzalan's house was to kill him. Fortunately, however, and
apparently unknown to the attackers and those who designed the
raid, at six o'clock that morning of November 14th Punzalan and his
Chief of Police had left Tiaong to go to Lucena, the capital, to report
the results of the election to the Governor.
The attack on the house of Punzalan was witnessed and described by
several persons, including policemen who happened to be near the
house. Policeman Tomas Maguare who was in front of the house saw
Epifanio Pasumbal, Isidro Umali (brother of Congressman Umali) and
Moises Escueta enter the gate of Punzalan's house and take part in
the firing. Policeman Pedro Lacorte who was stationed as guard at the
gate of Mayor Punzalan's house recognized defendant Isidro Capino as
one of those firing at the house. Lacorte said that he was guarding the
house of Punzalan when he suddenly heard shots coming from the
sides of the house and going over to the place to investigate, he saw
armed men in fatigue and shouting "burn the house of Mayor
Punzalan"; that he was hit on the left check and later Isidro Capino
threw at him a hand grenade and he was hit in the right forearm and
in the right eye and became permanently blind in said eye. Mateo
Galit, laundryman who was sitting inside a jeep parked in front of the
house of Punzalan recognized defendant Pasumbal as one of the
attackers who, once in the yard said ina loud voice as though
addressing somebody in the house "Pare, come down." Mrs. Punzalan
who was then inside the house related to the court that at about eight
in the evening while she was resting she heard shots and rapid firing.
As a precaution she took her children to the bathroom. Then she
noticed that her house was being fired at because the glass window
panes were being shattered and she heard the explosion of a hand
grenade inside the house, followed by flares in the sala and burning of
blankets and mosquito nets in the bedrooms and she noticed the
smell of smoke of gasoline. Realizing the great danger, she and the
children ran out of the house and went to hide in the house of a
neighbor.
Nazario Aonuevo declared in court that he was a farmer and was
picked up and seized by Huk Commander Tommy sometime in August
1951, and was taken to Mt. Banahaw in Laguna and mustered in the
ranks of the Huks; that just before the elections of November 13,
1951, he saw Pasumbal come to the mountains near Tiaong and talk
to Commander Abeng; that on November 14th by order of

Commander Abeng he with other Huks left Mt. Banahaw for Tiaong;
that when they crossed the Osiw River already near Tiaong, they were
met by Pasumbal and Capino; that when they were at the outskirts of
the town, he and the party were told by Commander Tommy to attack
the 8th BCT camp in Tiaong to prevent the sending of army help to
the town proper; that he took part in firing on the camp which
returned the fire in the course of which he was wounded; and that
because of his wound he could not escape with his companions to the
mountains when the Army soldiers dispersed and drove them out of
the town and so he was finally captured by said soldiers.
As to defendants Pasumbal and Capino, their participation in and
responsibility for the raid was duly established not only by the going
of Pasumbal on November 12th to the mountains following
instructions of Umali, and conferring with Commander Abeng asking
him to raid Tiaong and kill Punzalan, but also by the fact that
Pasumbal and Capino in the afternoon or evening of November 14th
met the Huks at the Osiw River as the dissidents were on their way to
Tiaong and later Pasumbal and Capino were seen in the yard of
Punzalan firing at the house with automatic weapons and hand
grenades.
What about Umali? His criminal responsibility was also established,
tho indirectly. We have the testimony of Amado Mendoza who heard
him instructing Pasumbal to contact Commander Abeng and ask him
to raid Tiaong and kill Punzalan. The rest of the evidence is more or
less circumstantial, but nonetheless strong and convincing. No one
saw him take part in the firing and attack on the house of Punzalan;
nor was he seen near or around said house. Because of his important
position as Congressman, perchance he did not wish to figure too
prominently in the actual raid. Besides, he would seem to have
already given out all the instructions necessary and he could well stay
in the background. However, during the raid, not very far from
Punzalan's house he was seen in the lanzonesan of his father, holding
a revolver and in the company of about 20 armed men with Huk
Commander Torio, evidently observing and waiting for developments.
Then he and his companions left in the direction of Taguan.
Umali and Pasumbal, however, claim that during the raid, they were in
the home of Pasumbal in Taguan, about seven kilometers away from
Tiaong where a consolation party was being held. There is ample
evidence however to the effect that they arrived in Pasumbal's home
only around midnight. An Army soldier named Cabalona who
happened to be in Pasumbal's home arriving there earlier in the
evening and who was invited to take some refreshments said that he

47

did not see the two men until they arrived about midnight when the
Army reinforcements from Lucena passed by on their way to Tiaong.
Thus, we have this chain of circumstances that does not speak in
favor of Umali, or Pasumbal for that matter. But this is not all. There is
the rather strange and unexplained, at least not satisfactorily,
behaviour of Umali and Pasumbal that evening of November 14th.
Assuming for a moment as they claim, that the two were not in Tiaong
at the commencement of the raid between 8:00 and 9:00 p.m., and
during the whole time the raid lasted, and that they were all that time
in the home of Pasumbal in Taguan, still, according to their own
evidence, they were informed by persons coming or fleeing from
Tiaong that there was a raid going on there, and that some houses
were burning. As a matter of fact, considering the promixity of Taguan
to Tiaong, a distance of about seven kilometers and the stillness and
darkness of the night, the fire and the glow produced by the burning
of three houses and the noise produced by the firing of automatic
weapons and the explosion of the hand grenades and bottles of
gasoline, could and must have been seen and heard from Taguan. The
natural and logical reaction on the part of Umali and Pasumbal would
have been to rush to Tiaong, see what had really happened and then
render help and give succor to the stricken residents, including their
own relatives. It will be remembered that the houses of the fathers of
Umali and Pasumbal were in Tiaong and their parents and relatives
were residing there. And yet, instead of following a natural impulse
and urge to go to Tiaong, they fled in the opposite direction towards
Candelaria. And Umali instead of taking the road, purposely avoided
the same and preferred to hike through coconut groves so that upon
arriving in Candelaria, he was wet, and spattered and very tired. Had
they wanted to render any help to Tiaong they could have asked the
police authorities of Candelaria to send a rescue party to that town. Or
better still, when the army reinforcements from Lucena sent at the
instance of Punzalan, who at about eight or nine that evening was
returning to Tiaong from Lucena, found at the barrio or sitio of
Lusakan near Tiaong that there was fighting in the town, he
immediately returned to Lucena to get army reinforcements to relieve
his town, was passing by Taguan, where they were, Umali and
Pasumbal could have joined said reinforcements and gone to Tiaong.
Instead the two continued on their way to the capital (Lucena) where
before dawn, they went and contacted Provincial Fiscal Mayo, a first
cousin of Umali, and Assistant Fiscal Reyes and later had these two
officials accompany them to the Army camp to see Col. Gelveson, not
for the purpose of asking for the sending of aid or reinforcement to

Tiaong but presumably to show to the prosecution officials, specially


the Army Commander that they (Umali and Pasumbal) had nothing to
do whatsoever with the raid. Umali said he was trying to avoid and
keep clear of Tiaong because he might be suspected of having had
some connection with the raid and might be the object of reprisal. As
a matter of fact, according to Umali himself, while still in Taguan that
evening and before he went to Candelaria, somebody had informed
him that Col. Legaspi of the Army was looking for him. Instead of
seeking Col. Legaspi and find out what was wanted of him, he left in
the opposite direction and fled to Candelaria and later to Lucena, and
the next day he took the train for Manila. This strange act and
behaviour of the two men, particularly Umali, all contrary to impulse
and natural reaction, and what other people would ordinarily have
done under the circumstances, prompted the trial court in its decision
to repeat the old saying "The guilty man flees even if no one pursues,
but the innocent stands bold as a lion." We might just as well
reproduce that portion of the decision of the trial court, to wit:
. . . Considering the fact that Taguan is very near Tiaong so
that even taking it for granted as true, for the sake of
argument, that the said accused were really at the party of
Pasumbal on the night in question, that would not prevent
them from being in Tiaong between 8 and 9. Besides, why was
it that night the hasag lamp was replaced with candles when
the reinforcements passed through Taguan about midnight of
November 14, 1951. Why did Congressman Umali and
company instead of going to Tiaong which was the scene of
the attack hurried towards Candelaria, after the reinforcement
has passed and went to the house of Felix Ona walking
through a muddy path under the coconut groves? Why was
Umali afraid to pass through the provincial road and preferred
a muddy road instead? Was he trying to conceal himself? Why
did Pasumbal and company also go to the house of Ona? Why
did they go to the house of Felix Ona instead of going to the
house of Manalo who could have given them better
protection? And again why did Congressman Umali and the
other co-accused repaired and sought the company of Fiscal
Reyes in going at such an early hour to the Army authorities,
did they fear any reprisal? From whom? Why did Umali go to
Manila from Lucena on November 16, 1951? "The guilty man
flees even if no one pursues, but the innocent stands bold as a
lion."

48

At first blush it would appear rather unbelievable that Umali and


Pasumbal, particularly the former should seek the aids of the Huks in
order to put down and eliminate their political enemy Punzalan. It
would seem rather strange and anomalous that a member of
Congress should have friendly relations with this dissidents whom the
Government had been fighting all these years. But if we study the
evidence, it will be found that the reason and the explanation are
there. As already stated, during the Japanese occupation, to further
the resistance movement, guerillas were organized in different parts
of the Philippines. One of these was the guerilla unit known as
President Quezon's Own Guerillas (PQOG) operating in the provinces
of Tayabas (now Quezon) and Laguna. Umali, Pasumbal, Commander
Abeng and even Punzalan himself were officers in this guerilla unit,
Umali attaining the rank of colonel, and Pasumbal and Punzalan that
of Lieutenant-colonel, Pasumbal then being known as "Panzer". After
Liberation, Abeng joined the dissidents, and became a Huk
Commander. It was not unnatural that Umali and Pasumbal should
continue their friendship and association with Commander Abeng and
seek his aid when convenient and necessary. Umali admitted that he
knew Huk Commander Kasilag. Graciano Ramos, one of the witnesses
of the prosecution told the court that way back in May 1950, in a
barrio of San Pablo City he saw Umali confer with Commander Kasilag,
which Commander after the conference told his soldiers including
Ramos that Umali wanted the Huks to raid Tiaong, burn the
presidencia and kidnap Punzalan. Of course, the last part of the
testimony may be regarded as hearsay, but the fact is that Umali
conferred with a Huk commander as early as 1950. Then we have the
fact that on November 18 of the same year Punzalan wrote to
President Quirino denouncing the congressman Umali for fraternizing
with the Huks and conducting a campaign among them in preparation
for the elections the following year. And we may also consider the fact
that the town of Tiaong stands at the foothills of Mt. Banahaw where
the dissidents under Commander Abeng, Tommy, Lucio, Aladin, and
others had their hideout, so that it was not difficult for residents of
Tiaong like Umali and Pasumbal to communicate and even associate
with dissidents in that region.
After carefully considering all the evidence in the case, we are
constrained to agree with the trial court that the three appellants are
guilty. Besides, the determination of this case, in great measure,
hinges on the credibility of witnesses. The learned trial court which
had the opportunity of observing the demeanor of witnesses on the
stand and gauging their sincerity and evaluating their testimony,

decided the Government witnesses, including Amado Mendoza, to be


more credible and reliable. And we find nothing in the record to
warrant correction or reversal of the stand and finding of the trial
court on the matter. We have not overlooked the rather belated
retraction of Amado Mendoza made on October 31, 1952, about a
year and 9 months after he testified in court. Considering the
circumstances surrounding the making of this affidavit or retraction,
the late date at which it was made, the reasons given by him for
making it and the fact that when he testified in court under the
observation and scrutiny of the trial court bearing in mind that he was
the star witness for the prosecution and his testimony naturally
extremely important, and the trial court after the opportunity given to
it of observing his demeanor while on the witness stand had regarded
him as a witness, sincere, and his testimony truthful, and considering
further the case with which affidavits of retraction of this nature are
obtained, we confess that we are not impressed with such retraction
of Mendoza.
The last point to be determined is the nature of the offense of
offenses committed. Appellants were charged with and convicted of
the complex crime of rebellion with multiple murder, frustrated
murder, arson and robbery. Is there such a complex crime of rebellion
with multiple murder, etc? While the Solicitor General in his brief
claims that appellants are guilty of said complex crime and in support
of his stand "asks for leave to incorporate by reference" his previous
arguments in opposing Umali's petition for bail, counsel for appellants
considered it unnecessary to discuss the existence or non-existence of
such complex crime, saying that the nature of the crime committed
"is of no moment to herein appellants because they had absolutely no
part in it whatsoever". For that present, and with respect to this
particular case, we deem it unnecessary to decide this important and
controversial question, its consideration and determination to another
case or occasion more opportune, when it is more directly and
squarely raised and both parties given an opportunity to discuss and
argue the question more adequately and exhaustively. Considering
that, assuming for the moment that there is no such complex crime of
rebellion with murder, etc., and that consequently appellants could
not have been legally charged with, much less convicted of said
complex crime, and the information should therefore, be regarded as
having charged more than one offense, contrary to Rule 106, section
12 and Rule 113, section 2 (e), of the Rules of Court, but that
appellants having interposed no objection thereto, they were properly
tried for and lawfully convicted if guilty of the several, separate

49

crimes charged therein, we have decided and we rule that the


appellants may properly be convicted of said several and separate
crimes, as hereinafter specified. We feel particularly supported and
justified in this stand that we take, by the result of the case, namely,
that the prison sentence we impose does not exceed, except perhaps
in actual duration, that meted out by the Court below, which is life
imprisonment.
We are convinced that the principal and main, tho not necessarily the
most serious, crime committed here was not rebellion but rather that
of sedition. The purpose of the raid and the act of the raiders in rising
publicly and taking up arms was not exactly against the Government
and for the purpose of doing the things defined in Article 134 of the
Revised Penal code under rebellion. The raiders did not even attack
the Presidencia, the seat of local Government. Rather, the object was
to attain by means of force, intimidation, etc. one object, to wit, to
inflict an act of hate or revenge upon the person or property of a
public official, namely, Punzalan was then Mayor of Tiaong. Under
Article 139 of the same Code this was sufficient to constitute sedition.
As regards the crime of robbery with which appellants were charged
and of which they were convicted, we are also of the opinion that it
was not one of the purposes of the raid, which was mainly to kidnap
or kill Punzalan and destroy his house. The robberies were actually
committed by only some of the raiders, presumably dissidents, as an
afterthought, because of the opportunity offered by the confusion and
disorder resulting from the shooting and the burning of the three
houses, the articles being intended presumably to replenish the
supplies of the dissidents in the mountains. For these robberies, only
those who actually took part therein are responsible, and not the
three appellants herein. With respect to the crime of multiple
frustrated murder, while the assault upon policeman Pedro Lacorte
with a hand grenade causing him injuries resulting in his blindness in
one eye, may be regarded as frustrated murder; the wounding of
Ortega, Anselo, Rivano, Garcia and Lector should be considered as
mere physical injuries. The crimes committed are, therefore, those of
sedition, multiple murder, arson, frustrated murder and physical
injuries. The murders may not be qualified by evident premeditation

because the premedition was for the killing of Punzalan. The result
was the killing of three others intended by the raiders (People vs.
Guillen, 47 Off). The killing may, however, be qualified by treachery,
the raiders using firearms against which the victims were defenseless,
with the aggravating circumstance of abuse of superior strength. The
three murders may be punished with the penalty of death. However,
because of lack of the necessary votes, the penalty should be life
imprisonment.
We deem it unnecessary to discuss the other points raised by the
appellants in their brief.
In conclusion, we find appellants guilty of sedition, multiple murder,
arson, frustrated murder and physical injuries. For the crime of
sedition each of the appellants is sentenced to 5 years of prision
correctional and to pay a fine of P4,000; for each of the three
murders, each of the appellants is sentenced to life imprisonment and
to indemnify the heirs of each victim in the sum of P6,000; and for the
arson, for which we impose the maximum penalty provided in Article
321, paragraph 1, of the Revised Penal Code, for the reason that the
raiders in setting fire to the buildings, particularly the house of
Punzalan they knew that it was then occupied by one or more
persons, because they even and actually saw an old lady, the mother
of Punzalan, at the window, and in view of the aggravating
circumstances of nighttime, each of the appellants is sentenced
to reclusion perpetua and to pay the indemnities mentioned in the
decision of the lower court. It shall be understood, however, the
pursuant to the provisions of Article 70 of the Revised Penal Code the
duration of all penalties shall not exceed 40 years. In view of the
heavy penalties already imposed and their long duration, we find it
unnecessary to fix and impose the prison sentences corresponding to
frustrated murder and physical injuries; however, the sums awarded
the victims (Lacorte, Ortega, Anselo, Rivano, Garcia and Lector), by
the court below will stand. With these modifications, the decision
appealed from is hereby affirmed, with costs.
Pablo, Bengzon, Padilla, Reyes, A., Jugo, Bautista Angelo, Concepcion
and Reyes, J.B.L., JJ., concur.

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