Alvarez vs Intermediate Appellate Court

(G.R. No. 68053, 7 May 1990, 185 SCRA 8)

Laura Alvarez, Flora Alvarez and Raymundo Alvarez , petitioners, vs. The Honorable Intermediate
Appellate Court and Jesus Yanes, Estelita Yanes, Antonio Yanes, Rosario Yanes, and Iluminado
Yanes, respondents.
(G.R. No. 68053, 7 May 1990, 185 SCRA 8)

Ponente: Chief Justice Marcelo B. Fernan

Doctrines

(Succession)
(1) Hereditary assets are always liable in their totality for the payment of the debts of the estate.
However, the estate’s heirs are only liable only to the extent of the value of their inheritance.

(2) When a right or fact has been judicially tried and determined by a court of competent jurisdiction,
so long as it remains unreversed, it should be conclusive upon the parties and those in privity with
them in law or estate.

(Property)
The sole remedy of the landowner whose property has been wrongfully or erroneously registered in
another's name is to bring an ordinary action in the ordinary court of justice for reconveyance or, if the
property has passed into the hands of an innocent purchaser for value, for damages.

Type of Action / Appeal

A petition for review on certiorari which seeks reversal of (a) decision of the Intermediate Appellate
Court’s Fourth Civil Cases Division dated 31 August 1983 which affirmed the decision of Court of the
First Instance (CFI) of Negros Occidental and (b) (b) the resolution of said appellate court dated 30 May
1984 which denied the petitioner’s motion for reconsideration of its decision.

Facts

The properties involved in the suit are Lots 773-A and 773-B, originally parts of Lot 773 of the Cadastral
Survey of Murcia, Negros Occidental, which had an area of 156,549 square meters. Lot 773 was
registered in the name of the heirs of Aniceto Yanes under Original Certificate of Title No. RO-4858
(8804) issued on 9 October 1917 by the Register of Deeds of Occidental Negros. Aniceto Yanes left Lots
773 and 823 to his children Rufino, Felipe and Teodora.

Estelita, Iluminado and Jesus, are the children of Rufino who died in 1962, while Antonio and Rosario
Yanes are children of Felipe. Teodora was survived by her child Jovito Alib.

Teodora cultivated only three hectares of Lot 823 as she could not attend to the other portions of the two
lots which had a total area of around twenty-four hectares. The record does not show whether Felipe’s
children also cultivated some portions of the lots but it is established that Rufino and his children left the
province to settle in other places as a result of the outbreak of World War II.

According to Estelita, from the "Japanese time up to peace time", they did not visit the parcels of land in
question but "after liberation", when her brother went there to get their share of the sugar produced

ARCHIBALD JOSE T. MANANSALA

Juris Doctor – 3A
AY 2015-2016
 Alvarez vs Intermediate Appellate Court
(G.R. No. 68053, 7 May 1990, 185 SCRA 8)

therein, he was informed that Fortunato Santiago, Fuentebella (Puentevella) and Alvarez were in
possession of Lot 773.

On 19 May 1938, Fortunato D. Santiago was issued Transfer Certificate of Title No. RF 2694 (29797)
covering Lot 773-A with an area of 37,818 square meters and described as a portion of Lot 773 of the
cadastral survey of Murcia originally registered under OCT No. 8804. Later, on 6 September 1938, the
bigger portion Lot 773-B, with an area of 118,831 square meters was also registered to his name under
TCT No. RT-2695 (28192). Fortunato sold Lots 773-A and 773-B on 30 May 1955 to Monico B.
Fuentebella, Jr. for P7,000.00 and on 20 February 1956, TCT Nos. T-19291 and T-19292 were issued in
Fuentebella's name.

After Monico's death and during the settlement of estate, his wife and the administratrix of his estate
Arsenia Vda de Fuentebella filed a motion which requested authority to sell Lots 773-A and 773-B in the
Court of First Instance of Negros Occidental (as Special Proceedings No. 4373). The court granted
Arsenia’s motion, and the two lots were sold on 24 March 1958 by Arsenia for P6,000.00 to Rosendo
Alvarez. TCT Nos. T-23165 and T-23166 covering Lots 773-A and 773-B were respectively issued on 1
April 1958 to Rosendo.

On 26 May 1960, Teodora Yanes and Rufino’s children Estelita, Iluminado and Jesus, filed in the Court
of First Instance of Negros Occidental a complaint against Fortunato Santiago, Arsenia Vda. de
Fuentebella, Alvarez and the Register of Deeds of Negros Occidental for the "return" of the ownership
and possession of Lots 773 and 823 (docketed as Civil Case 5022). However, while the case was pending
with the trial court, Rosendo sold on 13 November 1961 Lots 773-A, 773-B and another lot for
P25,000.00 to Dr. Rodolfo Siason, and TCT Nos. 30919 and 30920 were issued in Siason’s name.

On 11 October 1963, the trial court via its judgment in Civil Case 5022 that Rosendo would reconvey and
deliver possession to the respondents (plaintiffs in the civil case) the lots Nos. 773 and 823. However,
execution of said decision proved unsuccessful as to Lot 773, as the lot was already subdivided into 773-
A and 773-B and under Siason’s name.

Later, the Yaneses filed an action for recovery of real property with damages (docketed as Civil Case
8474) against Register of Deeds of Negros Occidental, Rodolfo Siason and Rosendo Alvarez’s children
(petitioners Laura, Flora and Raymundo), which prayed for cancellation of TCT Nos. T-19291 and
19292 issued to Siason and delivery of Lot 773 (as Lot 773-A and 773-B) to them. They also prayed that
if delivery of the lot could not be effected or a new title could be issued, the Alvarezes and Siason jointly
and severally pay the Yaneses the sum of P45,000.00; accounting of the fruits of Lot 773 from 13
November 1961 until the time of complaint’s filing, and payment of attorney’s fees, moral and exemplary
damages.

On 8 July 1974, the trial court rendered its decision which found Rodolfo Siason as a buyer in good faith
for a valuable consideration. It ordered Laura, Flora and Raymundo Alvarez to pay jointly and severally
respondents Jesus, Estelita, Antonio, Rosario and Illuminado Yanes the sum of P20,000.00 representing
the actual value of Lots Nos. 773-A and 773-B, P2,000.00 as actual damages suffered by the plaintiffs;
moral damages of P5,000.00 and attorney’s fees of P2,000, all with legal rate of interest from the time of
the complaint’s filing up to final payment.

The Alvarezes appealed the 8 July 1974 decision of the trial court to the Intermediate Appellate Court.
The appellate court, via its decision dated 31 August 1983, affirmed the lower court’s decision except the

ARCHIBALD JOSE T. MANANSALA

Juris Doctor – 3A
AY 2015-2016
 Alvarez vs Intermediate Appellate Court
(G.R. No. 68053, 7 May 1990, 185 SCRA 8)

award of attorney’s fees, moral and exemplary damages. It also ruled that it it is powerless to review the
decision in Civil Case No. 5022 which ordered the late Rosendo Alvarez to reconvey the lots to the
Yaneses, as the decision in that case had been long final and executory. The Alvarezes filed their Motion
for Reconsideration of the appellate court’s decision, but the appellate court denied their motion via its
resolution dated 30 May 1984.

VERDICT

The assailed decision of the Court of Appeals is AFFIRMED, and the instant petition for review of the
petitioner’s Laura, Flora and Raymundo Alvarez is DEVOID OF MERIT.

LAW PROVISIONS

Articles 774 and 776, Rep. Act. 386 (New Civil Code of the Philippines) states:

Article 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. (n)

Article 776: The inheritance includes all the property, rights and obligations of a person which
are not extinguished by his death. (659)

ISSUES AND RULING OF THE SUPREME COURT

Hence, the instant petition for review by Rosendo’s children (Laura, Flora and Raymundo) raised the
following issues:

(1) Whether the Yaneses’ claim against Dr. Siason and the petitioners as heirs of late Rosendo
Alvarez barred by statute of limitation and/or prescription of action and estoppel?

NO. The Supreme Court ruled that the decision in Civil Case No. 5022 has been long final and
executory and is the law of the case between the parties. It ended when Alvarez or his heirs failed
to appeal the decision against them. In fact, Civil Case No. 8474 arose from the failure to execute
the reconveyance and delivery of possession of the lots (Lots 773-A and 773-B) in Civil Case No.
5022, as these lots can no longer be reconveyed to private respondents because of the sale of said
lots during the pendency of the case between the petitioners' father Rosendo and Dr. Siason (who
did not know about the controversy), as there is no lis pendens annotated on the titles. Hence, it
was also settled beyond question that Dr. Siason is a purchaser-in-good faith.

In the present case, it was ruled by the Supreme Court that sole remedy of the landowner whose
property has been wrongfully or erroneously registered in another's name is to bring an ordinary
action in the ordinary court of justice for reconveyance or, if the property has passed into the
hands of an innocent purchaser for value, for damages.

Also, the Supreme Court ruled that when a right or fact has been judicially tried and determined
by a court of competent jurisdiction, so long as it remains unreversed, it should be conclusive
upon the parties and those in privity with them in law or estate. Once a litigant's right has been

ARCHIBALD JOSE T. MANANSALA

Juris Doctor – 3A
AY 2015-2016
 Alvarez vs Intermediate Appellate Court
(G.R. No. 68053, 7 May 1990, 185 SCRA 8)

adjudicated in a valid final judgment of a competent court, he should not be granted an unbridled
license to return for another try. The prevailing party should not be harassed by subsequent suits.

(2) Whether the liability or liabilities of Rosendo Alvarez arising from the sale of Lots Nos. 773-A
and 773-B to to Dr. Rodolfo Siason, if any, could be legally passed or transmitted by operation of
law to the petitioners?

YES, as they are heirs of Rosendo Alvarez. Thus, they cannot escape the legal consequences of
their father's transaction which gave rise to the present claim for damages. The Supreme Court
said that hereditary assets are always liable in their totality for the payment of the debts of the
estate. However, the estate’s heirs are only liable only to the extent of the value of their
inheritance.

The Supreme Court reiterated its decision in Estate of K.H. Hemady vs. Luzon Surety, that while
the responsibility of the heirs for the debts of their decedent cannot exceed the value of the
inheritance they receive, the principle remains intact that these heirs succeed not only to the rights
of the deceased but also to his obligations, as expressly provided by Article 774 and 776 of the
Civil Code. The Supreme Court stated that the binding effect of contracts upon the heirs of the
deceased party is not altered by the provision in our Rules of Court that money debts of a
deceased must be liquidated and paid from his estate before the residue is distributed among said
heirs. The reason is that whatever payment is thus made from the estate is ultimately a payment
by the heirs and distributees, since the amount of the paid claim in fact diminishes or reduces the
shares that the heirs would have been entitled to receive.

ARCHIBALD JOSE T. MANANSALA

Juris Doctor – 3A
AY 2015-2016