Republic of the
Supreme Court
THIRD DIVISION
HEIRS
OF
and
CIRILA DUMALIANG,[1]
represented
by NICANOR B. Present:
GUIAB,
FELIPE D. GUMABON[2]
and
FRANCISCO MARADDAG, YNARES-SANTIAGO,
J.,
Petitioners, Chairperson,
AUSTRIA-MARTINEZ,
CALLEJO, SR.,
CHICO-NAZARIO, and
NACHURA,
JJ.
-
versus -
DAMIANO
SERBAN, ERNESTO
SERBAN,
WILSON SERBAN,
DOMINGA
SERBAN, VIRGILIO
SERBAN
and MARIANO SERBAN,
Respondents. Promulgated:
February
21, 2007
x-
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
- - - - - - - - - - x
D E C I S I O N
AUSTRIA-MARTINEZ,
J.:
Before us
is a Petition for Review on Certiorari filed by the heirs[3]
(petitioners) of Rosa and Cirila Dumaliang(Dumaliang sisters), represented by Nicanor
A. Guiab (Guiab),[4]
Felipe D. Gumabon (Gumabon)[5]
and Francisco Maraddag[6] assailing the Decision[7]
dated
The subject
matter of the instant controversy is the 56,804-square meter portion of the
76,804-sq m lot located in Echague, Isabela originally covered by Original Certificate of Title
(OCT) No. 2524 of the Register Deeds of Isabela under
the names of Rosa and Cirila Dumaliang. In May
1965, Gumabon and Guiab
together with some of the heirs[9]
of the Dumaliang sisters conveyed 20,000 sq m of the
lot covered by OCT No. 2524 in favor of Damiano Serban (respondent Damiano) by
virtue of an Extra-Judicial Partition of
Estate and Deed of Absolute
On
In their amended
complaint, petitioners alleged that: they are the legitimate heirs of the Dumaliang
sisters who died on August 6, 1939 and January 13, 1936; that upon the sale of
the 20,000 sq m portion of the lot covered by OCT No. 2524 to respondent Damiano in 1965, the latter asked for the original title to
effect transfer of the 20,000 sq m lot to his name and the same was given to him
by Gumabon, one of the contracting heirs who was in
custody of the title; in 1992, petitioners finally decided to partition the
remaining 56,804 sq m of the lot covered
by OCT No. 2524 but learned from Gumabon that the original title was still in the custody of
respondent Damiano who failed to return the same;
they made inquiry from respondent Damiano and the
latter cannot produce the title because the title for the 20,000 sq m he bought
was still under process and in the custody of another person for the
processing; fearing that the title could have been lost, petitioners went to
the Office of the Provincial Assessor to inquire and investigate; they
discovered that there is a Deed of
Extra-Judicial Settlement and Sale[15]
dated June 20, 1962, allegedly signed by the legal heirs of
the Dumaliang sisters transferring the entire 76,804
sq m lot in respondent Damiano’s favor which became
the basis of the issuance of TCT No. 26676
on July 19, 1965; that such deed was fraudulent, void and inexistent since some
of the signatures therein were falsified while the other signatories could not
have affixed their signatures and personally appeared before the notary public
in 1962 since they were already dead, and a compulsory heir did not also sign;
that the entire lot had already been partitioned and several titles were
already issued to respondent Damiano’s children who
are also impleaded as respondents; respondents’ refusal
to surrender possession of the subject lot despite demand illegally deprived them
of their primary source of income.
In his
Answer with counterclaim to the original complaint,[16]
respondent Damiano admitted having bought 20,000 sq m
of the subject lot from some of the heirs of the Dumaliang
sisters. By way of special and affirmative defenses, respondents alleged that
long after the instrument embodying the sale of 20,000 sq m in his favor was
executed, a representative of the petitioners offered to sell the remaining
portion, and after he expressed willingness to buy the remaining portion, the
representative caused the preparation of the instrument by Atty. Anastacio J. Pascua in his office
where the transaction took place, and the owner’s copy of OCT No. 2524 was given to him on June 20,
1962; that right after the said transaction, respondent Damiano
started to possess and cultivate the entire lot and subsequently obtained a new
title on July 19, 1965; that respondent Damiano has
been in lawful and peaceful possession of the said lot, and that he subdivided the
lot and donated the same to his six children who are now in possession and
cultivation thereof; that the complaint should be dismissed for failure to
state a valid cause of action, laches,
prescription, estoppel and/or statute of fraud.
Respondent Damiano prayed for damages.
The trial
court set the case for hearing on the affirmative defenses. However, respondents
manifested that they will just submit their memorandum. The RTC required
petitioners to file their comment thereon.
Thereafter,
or on
Petitioners’
Motion for Reconsideration was denied in an Order[18]
dated
Petitioners
filed their appeal with the CA. Respondents did not file their brief.
On
Petitioners’
Motion for Reconsideration was denied by the CA in a Resolution dated
Hence, the
instant Petition for Review on Certiorari filed by petitioners.
The lone
issue presented is whether or not the Court of Appeals erred in affirming the
RTC in the dismissal of the petition on the ground of laches.
Petitioners
reiterated their contention that they merely conveyed 20,000 sq m of the lot
covered by OCT No. 2524 to respondent Damiano in
1965; that the alleged 1962 Extra-Judicial Partition and Deed of Sale which
conveyed the entire lot to respondents was forged; that said deed was allegedly
executed in 1962 by the Dumaliang sisters who were
already deceased since 1930s; that laches is not applicable in this case as the title
of respondents was obtained by means of a void document; that the right to file
an action for reconveyance on the ground that the
certificate of title was obtained by means of a fictitious deed of sale is
virtually an action for the declaration of its nullity, which action does not
prescribe. Petitioners claim that laches is
addressed to the sound discretion of the court, and its application is
controlled by equitable considerations and cannot defeat justice or perpetrate
fraud; that it was only in 1992 when they discovered the existence of the
falsified deed and immediately brought the instant action; that a new title
issued in respondent Damiano’s name and subsequently
to the other respondents does not necessarily mean that they have acquired
ownership over the same; and that the Torrens system is not a means of
acquiring titles to land and indefeasibility of title does not attach to titles
secured by fraud or misrepresentation.
We find the
petition impressed with merit.
In Españo, Sr. v. Court of Appeals,[20]
we defined laches as follows:
The
essence of laches
or “stale demands” is the failure or neglect for an unreasonable and
unexplained length of time to do that which, by exercising due diligence, could
or should have been done earlier, thus giving rise to a presumption that the
party entitled to assert it either has abandoned or declined to assert it. It is not concerned with mere lapse of time,
the fact of delay, standing alone, being insufficient to constitute laches.
There
is no absolute rule as to what constitutes laches
or staleness of demand; each case is to be determined according to its
particular circumstances. Ultimately, however, the question of laches is addressed to the sound discretion of the
court since it is an equitable doctrine, its application is controlled by
equitable considerations. [21]
The four
basic elements of laches are: (1) conduct on
the part of the defendant, or of one under whom he claims, giving rise to the
situation of which complaint is made and for which the complaint seeks a
remedy; (2) delay in asserting the complainant's rights, the complainant having
had knowledge or notice of the defendant’s conduct and having been afforded an opportunity
to institute suit; (3) lack of knowledge or notice on the part of the defendant
that the complainant would assert the right on which he bases his suit; and, (4)
injury or prejudice to the defendant in the event relief is accorded to the
complainant or the suit is not held to be barred. [22]
These elements must all be proved positively.[23]
In this
case, only the first element was proven, that is, the act of respondent Damiano in registering the entire 76,804 sq m based on a
Deed of Extra-Judicial Settlement and
The second
element speaks of delay in asserting the complainant’s rights. However, the
mere fact of delay is insufficient basis to conclude that herein petitioners
are guilty of laches.[24] It is required that (1) complainant must have
had knowledge of the conduct of defendant or of one under whom he claims; and, (b)
he must have been afforded an opportunity to institute suit.[25]
The trial
court held that since the issuance of TCT No 26676 in respondent Damiano’s name in 1965 up to the filing of the instant
case, 32 years had already lapsed, thus laches
had already set in. However, the delay must
be attended by knowledge on petitioners’ part of the transfer of the entire lot
in respondent Damiano’s name in July, 1965. Notably,
petitioners alleged in their complaint that it was only sometime in May, 1965
that some of them conveyed 20,000 sq m of the 76,804 sq m to respondent Damiano which respondents even admitted. Thus, how could
petitioners be considered to have been aware that the entire lot was registered
in respondent Damiano’s name in July, 1965 by virtue
of a Deed of Extra-Judicial Settlement and Sale dated June 20, 1962 when Damiano undisputedly bought only 20,000 sq m of the same
lot in May, 1965, or two months before the registration of the entire lot in
respondent Damiano’s name in July 1965. Considering that respondents invoke laches as their affirmative defense against
petitioners for the latter’s failure to assert their right for a long time, it
was incumbent upon respondents
to positively show such knowledge on
petitioners’
part.[26]
Such knowledge had not been sufficiently established by respondents.
Moreover,
it was further alleged by petitioners that it was only in 1992 when they decided
to partition the remaining 56,804 sq m of the lot and learned from Gumabon, the heir to whom the safekeeping of title was
entrusted, that the original title which he gave to respondent Damiano in 1965 was still with respondent Damiano; that petitioners then made inquiry from respondent
Damiano regarding the title who informed them that
the title is in the custody of another person for the transfer of the 20,000 sq
m in his name; that it was only after investigating with the Office of the Provincial
Assessor that petitioners learned of the transfer of the entire lot in
respondent Damiano’s name in 1965 through a Deed of
Extra-Judicial Settlement and Sale dated
June 20, 1962. Thus, petitioners could
not have had the opportunity to institute the suit earlier than 1992. Petitioners filed the instant case in the RTC
in 1997.
The RTC and
the CA uniformly concluded that since the registration of the entire lot in
respondent Damiano’s name in 1965, he has been in
possession and cultivation of the entire lot. As to whether or not the exact nature of
possession of respondents is adverse, based on the claim of exclusive ownership,
is a factual matter which needs presentation and appreciation of evidence. We will
not venture to make any determination thereon for we are not a trier of facts.[27]
Moreover, since the trial court had not
conducted a hearing on the affirmative defense of laches,
its finding was merely based on respondents’ allegations in their memorandum in
support of their defense of laches. It has been held that laches
is evidentiary in nature which could not be established by mere allegations in
the pleadings and cannot be resolved in a motion to dismiss.[28]
It bears
stressing that the entire lot consists of 76,804 sq m. Thus,
it was incumbent upon respondents to positively show that indeed they were in
possession of the same since 1965 and that petitioners were indeed aware of
such possession. Again, respondents’ memorandum submitted in support of their
affirmative defense of laches as well as their
Answer did not show how their possession was manifested and the actuations of petitioners
to show knowledge of respondents’
possession of the entire lot.
The third
element of laches has not been met by
respondents. They have not sufficiently
shown that they have no knowledge that petitioners would assert their ownership
over the 56,804 sq m, i.e., the excess of the 20,000 sq m they bought in
1965. Respondents failed to satisfactorily explain in their pleadings the fact
that despite the alleged sale of the entire lot to respondent Damiano in 1962, they still bought the 20,000 sq m of the
same lot in 1965. Respondents’ Answer states:
x x x
5. That
the allegations contained in paragraphs 6 and 7 of the complaint are admitted
regarding the sale of a portion of 20,000 of the above-described parcel of land
by some of the legitimate heirs of the late Rosa Dumaliang
and Cirila Dumaliang in
favor of the defendant, which sale is embodied in an instrument denominated
“Extrajudicial Partition of Estate and Deed of Absolute Sale”
x x x
SPECIAL AND AFFIRMATIVE DEFENSES
x x x
8. That long after the instrument embodying the
sale of 20,000 square meters in favor of the defendant was executed, a representative
of the Heir of Rosa Dumaliang and Cirila
Dumaliang informed the defendant that the rest of the
heirs who own the remaining portion were offering to also sell to him the said
remaining portion of the parcel of land of Rosa and Cirila
Dumaliang;
9. That
after the defendant expressed willingness to buy the said remaining portion, the said representatives then caused
the preparation of the necessary
instrument by Atty. Anastacio J. Pascua
in his Office at Echague, Isabela,
where the transaction took place and where the owner’s copy of OCT No. 2524 was
given and received by the defendant on June 20, 1962. [29]
As
respondents admitted the sale of 20,000 sq m in 1965, and there were talks over
the sale of the remaining portion thereafter, how could it be possible that the
subsequent Deed of Extrajudicial Settlement and Sale be dated 1962 when the negotiations
took place in 1965? Only a full blown
trial can settle this discrepancy.
As to the
fourth element that irreparable injury would result to respondents if the 56,804
sq m would be returned to petitioners in case they are really entitled thereto,
suffice it to state that the doctrine of laches
cannot be worked to defeat justice or to perpetrate fraud and injustice.[30]
It is the better rule that courts, under the principle of equity, will not be
guided or bound strictly by the statute of limitations or the doctrine of laches when to do so, manifest wrong or injustice would
result.[31]
Notably, the
trial court dismissed the complaint based on laches
alone without taking into consideration the main issue raised by petitioners regarding the validity of the 1962 Deed of
Extra-Judicial Settlement and
Without
prejudging the issue as it is the trial court which would ultimately determine
the same, if it is established that petitioners’ consent was not given to the
1962 Deed of Extra-Judicial Settlement and Sale which became the basis for the
issuance of the new title over the entire lot in respondent Damiano’s
name in 1965, the absence of such consent makes the Deed null and void ab initio and subject to attack
anytime.[32] It
is recognized in our jurisprudence that a forged deed is a nullity and conveys
no title.[33] Article 1410 of the Civil Code clearly
provides that an action to declare the inexistence of a void contract does not
prescribe.
Likewise,
we have consistently ruled that when there is a showing of such illegality, the
property registered is deemed to be simply held in trust for the real owner by
the person in whose name it is registered, and the former then has the right to
sue for the reconveyance of the property. The action for the purpose is also imprescriptible, and as long as the land wrongfully registered
under the
If indeed
petitioners’ consent was not given, respondents could not have acquired ownership
over the 56,804 sq m lot by virtue of the 1962 Deed of Extra-Judicial
Settlement and
In Heirs
of Romana Ingjug-Tiro v. Casals, where we reversed the trial court’s dismissal
of petitioners’ complaint on the ground of
prescription and laches, and remanded
the case to the trial court for judgment on the merits, we said:
x x x
A cursory reading of the complaint, however, reveals that the action filed by petitioners was for partition, recovery of ownership and possession, declaration of nullity of a deed of sale of unregistered land and extrajudicial settlement and confirmation of sale. Petitioners' causes of action are premised on their claim that: (a) the Deed of Sale of Unregistered Land is void and of no effect since their respective shares in the inheritance were included in the sale without their knowledge and consent, and one of the vendor-signatories therein, Eufemio Ingjug (Eufemio Tiro, husband of Romana Ingjug), was not even a direct and compulsory heir of the decedent; and (b) the Extrajudicial Settlement and Confirmation of Sale is simulated and therefore null and void ab initio, as it was purportedly executed in 1967 by, among others, Eufemio Tiro who was not an heir, and by Francisco Ingjug who died in 1963. Also, the prayer in the same complaint expressly asks that all those transactions be declared null and void. In other words, it is the nullity of the deeds of sale and the extrajudicial settlement and confirmation of the sale which is the basic hypothesis upon which the instant civil action rests. Thus, it appears that we are dealing here not with simple voidable contracts tainted with fraud, but with contracts that are altogether null and void ab initio.
x x x
In actions for reconveyance of property; predicated on the fact that the conveyance complained of was null and void ab initio, a claim of prescription of action would be unavailing. "The action or defense for the declaration of the inexistence of a contract does not prescribe." Neither could laches be invoked in the case at bar. Laches is a doctrine in equity and our courts are basically courts of law and not courts of equity. Equity, which has been aptly described as "justice outside legality," should be applied only in the absence of, and never against, statutory law. Aeguetas nunguam contravenit legis. The positive mandate of Art. 1410 of the New Civil Code conferring imprescriptibility to actions for declaration of the inexistence of a contract should pre-empt and prevail over all abstract arguments based only on equity. Certainly, laches cannot be set up to resist the enforcement of an imprescriptible legal right, and petitioners can validly vindicate their inheritance despite the lapse of time.
x x x
Without
any evidence on record relating to these points, this Court cannot affix its imprimatur
to the peremptory dismissal of the complaint in light of the pleas of
petitioners for their just share in the inheritance and for the partition of
their common predecessor's estate. Indeed, it is but fair and just that,
without prejudging the issues, the parties be allowed to substantiate their
respective claims and defenses in a full-blown trial, and secure a ruling on
all the issues presented in their respective pleadings.
WHEREFORE,
the instant petition is GRANTED. The
Decision dated October 17, 2001 and
Resolution dated August 26, 2002 of the Court of Appeals are REVERSED
and SET ASIDE, and the case is REMANDED to the RTC of Echague, Isabela, Branch 24, for pre-trial, trial and judgment on the
merits.
No costs.
SO ORDERED.
MA. ALICIA AUSTRIA-MARTINEZ
Associate
Justice
WE CONCUR:
CONSUELO
YNARES-SANTIAGO
Associate Justice
Chairperson
ROMEO
J. CALLEJO, SR. MINITA V. CHICO-NAZARIO
Associate Justice Associate Justice
ANTONIO EDUARDO B. NACHURA
Associate Justice
ATTESTATION
I attest that the conclusions in the
above Decision had been reached in consultation before the case was assigned to
the writer of the opinion of the Court’s Division.
CONSUELO
YNARES-SANTIAGO
Associate Justice
Chairperson, Third Division
C
E R T I F I C A T I O N
Pursuant to Section 13, Article VIII
of the Constitution, and the Division Chairperson’s attestation, it is hereby
certified that the conclusions in the above Decision had been reached in
consultation before the case was assigned to the writer of the opinion of the
Court’s Division.
REYNATO S. PUNO
Chief Justice
[1] Spelled as Dumailang in some pleadings.
[2] Sometimes spelled as Gumabun.
[3] Francisco, Rosa, Primo, Rogelio, Bonifacio, Jesusa, and Mateo, all surnamed Maraddag;
Letecia, Pantaleon,
Josefina, Cezar,
Corazon, Juan and Felisa, all surnamed Culang; Nicanor Guiab, Rosario Dumaliang, Pedro Gumabon; Consolacion, Maria, Demetria and Rosalina, all surnamed Samut; Nena Gumabon and Felipe Gumabon substituted by his heirs namely: Veronica, Pelagio, Jessie, Virginia and Nestor, all surnamed Gumabon per Resolution dated January 13, 2002, rollo, pp. 9 and 108.
[4] By virtue of Special Power of Attorney dated
[5] Died on
[6] A signatory in the Special Power
of Attorney dated
[7] Penned by Justice Conrado M. Vasquez, Jr., concurred in by Justices Martin S. Villarama, Jr. and Sergio L. Pestaño (now deceased); rollo, pp. 93-97.
[8]
[9] Pedro Culang, Antonia Culang, Feliciana Gumabon, Juan Gumabon, and Francisco Gumabon; records, pp. 71-72.
[10] Illegible.
[11] Executed by Jose, Pedro and Antonia, all surnamed Culang; Nicanor Guiab; Antonia, Alfonso, Consolacion , Joaquin, Maria, Jose , Rosalina and Demetria, all surnamed Samut; Rosario, Pedro, Maria and Sofio, all surnamed Gumabon.
[12] Granted in an Order dated
[13] Should be Evaresto per TCT No. 242769; records, p. 78; Evaresto died on March 16, 2004, survived by his children Hermogenes, Jovencio, Teresita and Grace, all surnamed Serban per Manifestation dated March 16, 2004; rollo, p. 111.
[14] Should be Vigilio per TCT No. 242768; records, p. 81.
[15] Executed by Jose, Pedro and Antonia, all surnamed Culang; Nicanor Guiab; Antonia, Alfonso, Consolacion , Joaquin, Maria, Jose , Rosalina and Demetria, all surnamed Samut; Rosario, Pedro, Maria and Sofio, all surnamed Gumabon.
[16] Records, pp. 37-40; also adapted by the other respondents .
[17] Penned by Judge Demetrio D. Calimag, Jr.; records, pp. 123-125; Civil Case No. 24-0479.
[18] Penned by Judge Bonifacio
T. Ong;
[19] CA rollo, p. 107.
[20] 335 Phil. 983 (1997).
[21]
[22] Felix Gochan and Sons Realty Corporation v. Heirs of Raymundo Baba, 456 Phil. 569, 579 (2003); Biala v. Court of Appeals, G.R. No. 43503, October 31, 1990, 191 SCRA 50, 56.
[23] Felix Gochan and Sons Realty Corporation v. Heirs of Raymundo Baba, supra, citing Santos v. Santos, 418 Phil. 681, 692 (2001).
[24] Bailon-Casilao
v. Court of Appeals, No. L-78178,
[25]
[26] Rules of Court, Rule 131, Sec. 1.
Section 1. Burden of proof. – Burden of proof is the duty of a party to present evidence on the facts in issue necessary to establish his claim or defense by the amount of evidence required by law.
[27] Españo, Sr. v. Court of Appeals, supra note 20 at 987.
[28] Felix Gochan and Sons Realty Corporation v. Heirs of Raymundo Baba, supra at 580; National Irrigation Administration v. Court of Appeals, 376 Phil. 362, 376 (1999).
[29] Records, pp. 37-38.
[30]
[31]
[32] Salomon v. Intermediate Appellate
Court, G.R. No. 70263, May 14, 1990, 185 SCRA 352, 363 citing Baranda v. Baranda,
No. L-73275,
[33]
[34]
[35] Heirs of Ingjug-Tiro
v. Casals, 415 Phil. 665, 672-673 (2001)
citing De Guzman v. Court of Appeals,
No. L-46935,