FIRST DIVISION
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BARCELIZA P. CAPISTRANO, Petitioner, - versus - DARRYL LIMCUANDO and FE Respondents. |
G.R. No. 152413
Present: PUNO, C.J., Chairperson, CARPIO, CORONA, AZCUNA, and LEONARDO-DE CASTRO, JJ. Promulgated: February 13, 2009 |
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DECISION
LEONARDO-DE
CASTRO, J.:
This
is a petition for review of the Court of Appeals’ (CA) Decision[1] dated
September 28, 2001 and the Resolution[2] dated February 1, 2002 in CA – G.R. CV
No. 49028, which affirmed the Amended
Decision[3] dated
January 23, 1995 rendered by the Regional Trial Court (RTC), Branch 32 of San
Pablo City, Laguna in Civil Case No. SP 3757.
Said civil case was an action for the annulment of a deed of sale or for
the repurchase of real property, wherein the RTC held:
WHEREFORE,
the Court hereby orders and adjudges:
1. The
validity of the Deed of Absolute Sale dated February 1, 1989 executed by plaintiff
[petitioner] in favor of defendants [respondents];
2. That
the true and correct consideration of the sale of the undivided one-half of the
property now registered under TCT No. T-127771 with an area of 195 square
meters in the name of plaintiff [petitioner] and defendants [respondents] is
P75,000.00 partial payment of P10,000.00 having been effected by defendants [respondents]
in favor of plaintiff [petitioner];
3. The
defendants [respondents] to pay the plaintiff [petitioner] the sum of
P65,000.00 representing the balance unpaid for the total cost of the disputed
property in the sum of P75,000.00. The
payment of P65,000.00 should be effected by defendants [respondents] to plaintiff
[petitioner] within thirty (30) days from receipt of this decision without
interest;
4. The claims of both parties for damages
against each other are denied for insufficiency of evidence.[4]
A
summary of the relevant facts culled from the pleadings and the evidence on
record follows:
Petitioner owned a parcel
of land, with an estimated area of 224 square meters located at Barangay
Talaga, Rizal, Laguna, covered by Original Certificate of Title No. P-10302
pursuant to a Free Patent issued on August 23, 1977. She sold this parcel of land with a right of
repurchase in favor of spouses Felimon Zuasola and Anita Subida on December 31,
1985.
On February 1, 1989,
petitioner sold half of the same parcel of land to respondents for the price of
P75,000.00 on the understanding that respondents shall pay the amount of
P10,000.00 as partial payment and the balance to be paid by monthly
installments. Petitioner received the
partial payment of P10,000.00 but signed a deed of absolute sale,
denominated as “Kasulatan ng Bilihang Tuluyan,” disposing half of the property
in favor of respondents purportedly in
consideration of the amount received.
Subsequently, respondents defaulted on their monthly installments. Petitioner repeatedly demanded for the
payment of the balance of P65,000.00 from respondents but the latter
refused to pay and claimed that they had already fully satisfied the
consideration for the disputed land according to the terms of the subject deed
of sale.
Respondents
learned afterwards that the disputed land had been previously sold by the
petitioner to the spouses Zuasola and Subida which led respondents to file a
criminal complaint for estafa against
petitioner on April 10, 1991. Petitioner
was eventually convicted.
On
August 19, 1991, petitioner repurchased the parcel of land from the spouses Zuasola
and Subida. She also offered to
repurchase from respondents the portion of the disputed land which she sold to
them but the latter refused. On
September 27, 1991, Transfer Certificate of Title No. 127771 over the disputed
land was issued in the names of respondents.
On
May 27, 1993, petitioner filed a complaint[5]
for the annulment of the subject deed of sale alleging that the sale was a
nullity from the beginning and that respondents even assailed its validity in
the previously mentioned criminal case for estafa against petitioner. As an alternative cause of action, petitioner
sought to repurchase the disputed land from respondents based on Section 119 of
Commonwealth Act No. 141 (Public Land Act).
She prayed as follows:
WHEREFORE,
it is respectfully prayed that judgment be rendered in favor of plaintiff and
against defendants:
1. To declare the “Kasulatan ng Bilihang
Tuluyan” as nullified;
2. To order the repurchase of the said
one-half (1/2) portion of the realty by the plaintiff [petitioner];
3. That defendants [respondents] be made to
pay the costs of this suit.
Plaintiff
[Petitioner] likewise prays for any other relief which to this Honorable Court
may be just and equitable in the premises.
In their Answer with
Counterclaim,[6]
respondents admitted the material facts of the case but chiefly contended that
they purchased the subject land from petitioner in consideration of the sum of
Ten Thousand Pesos (P10,000.00) only and that they never assailed the
validity of the subject deed of sale in the estafa case.
After
pre-trial and the marking of the exhibits, the parties manifested to the RTC
their intention to submit the case for judgment on the basis of the evidence on
record. The RTC directed the parties to
file their respective memoranda and, thereafter, rendered its judgment.
In its Amended Decision, the RTC sustained the
validity of the subject deed of sale and denied the right of the petitioner to
repurchase the disputed land from the respondents. In explanation, the trial court ruled:
When
plaintiff [petitioner] sold one-half (1/2) of the subject property to the
defendants [respondents] on February 1, 1989, the five (5) year period from the
date of issuance of the patent on August 23, 1977 had absolutely expired. There was no longer [any] barrier for the
plaintiff [petitioner] to dispose or alienate the subject property. When the plaintiff [petitioner] executed the
Venta con Pacto de Retro in favor of spouses Zuasola in 1985, the barrier or
prohibition was likewise already inapplicable because the five (5) year period
had already expired as almost eight (8) years had elapsed from the date of
issuance of the patent in 1977.
The filing of an Information for
Estafa against plaintiff [petitioner] is a criminal action which cannot properly
be considered as a basis for the annulment of a Deed of Absolute Sale executed
by plaintiff [petitioner] in favor of defendants [respondents]. The plaintiff [petitioner] was convicted of
Estafa on the basis of criminal evidence that supports a conviction beyond
reasonable doubt. The annulment of the
Deed of Absolute Sale should be ventilated in a separate civil action that
needs preponderance of evidence for the purpose. At this instance it should also be considered
seriously that when this action was filed on May 27, 1993, the plaintiff [petitioner]
was already aware that Transfer Certificate of Title No. T-127771 on the
disputed one-half portion was already issued in the name of defendants
[respondents] as of September 27, 1991 and which title originated from OCT
P-10302, the Free-Patent awarded to herein plaintiff [petitioner] on August 23,
1977 under Act No. 141. A perusal of the
complaint shows that it seeks relief for declaration of nullity of the Deed of
Absolute Sale executed by plaintiff [petitioner] in favor of defendants
[respondents] on February 1, 1989 but it does not seek annulment of TCT No.
T-127771 or a reconveyance of the same it appearing that said title is
registered in the name of the defendants [respondents] insofar as the one-half
disputed portion is concerned.
The repurchase made by the plaintiff
[petitioner] of the disputed property from the spouses Zuasola is a voluntary
act executed by plaintiff [petitioner] which the Court considers not binding
and effective for the annulment of the Deed of Sale of February 1, 1989 in
favor of defendants [respondents]. If
plaintiff [petitioner] opted to repurchase the subject property from the
spouses Zuasola it was because plaintiff [petitioner] was under the impression
that she was under the protective mantle of the provisions of Sec. 119 of
Public [Land] Act 141. This actuation of
plaintiff [petitioner] is not looked [upon] with favor by the Court.
The plaintiff [petitioner], however,
raised the issue of nonpayment of the full consideration of the sale of the
disputed one-half portion to the defendants [respondents] in the total sum of
P75,000.00. Defendants [Respondents]
alleged that the full consideration is P10,000.00 as envisioned in the Deed of
Absolute Sale and said amount having been fully paid to plaintiff [petitioner],
defendants [respondents] are no longer obligated to plaintiff
[petitioner]. The Court glaringly
noticed that the Deed of Sale with right of repurchase of the subject property
in favor of the Zuasolas was for the amount of P40,000.00 which shows that even
in 1985 the one-half undivided portion which is now the subject of this action
could command a consideration of P20,000.00 in a transaction of Venta Con Pacto
de Retro. The subject property abuts a
provincial road. The undivided one-half
of the whole property of 195 square meters to the mind of the Court could not
be fairly sold for a consideration of P10,000.00. The Court entertains a laudable and correct
impression that the subject property was agreed to be sold for the sum of
P75,000.00, the amount of P10,000.00 having already been paid in advance
leaving a balance of P65,000.00 which should therefore be paid by the
defendants [respondents] to plaintiff [petitioner].[7]
On
appeal by both petitioner and respondents, the CA affirmed the judgment of the
RTC as follows:
Plaintiff-appellant’s [Petitioner’s]
right to repurchase the one-half (1/2) portion of the property no longer
exists. The prohibition against the
alienation of the land acquired by [petitioner] by free patent ended on August
23, 1983 or five years from its issuance.
Thus, when plaintiff-appellant [petitioner] sold the one-half (1/2)
portion of the property to defendant-appellants [respondents] on February 1,
1989, the redemption period contemplated by Section 119 of the Public Land Act,
as amended, no longer finds application.
It may be true that the policy
behind homestead laws is to distribute disposable agricultural lands of the
state to land destitute citizens for their home and cultivation, but this right may not altogether be true
when the person invoking the same is guilty of bad faith.
In the instant case,
plaintiff-appellant [petitioner] was convicted of estafa by reason of the
double sale over the same property. She
repurchased the property from the first buyer only after an information had
already been filed against her. It is
inescapable that when she filed the complaint with the court a quo she was with
unclean hands. It is an act that negates the gratuitous reward by the State.
From the foregoing, we deem it fit
not to disturb the judgment of the court a quo.[8]
(Emphasis supplied)
Hence,
the instant petition for review.
Petitioner asserts that
the subject deed of sale is null and void.
The cause of this obligation, as an indispensable element of a contract,
is allegedly false because of the fact that, prior to the sale of the disputed
land in favor of the respondents in 1989, petitioner had the same land sold
with right of repurchase in favor of spouses Zuasola and Subida way back in
1985. [9] Petitioner’s asserts that her redemption of
the disputed land from spouses Zuasola and Subida does not cure a void contract
(i.e. the deed of sale in favor of
respondents). In addition, petitioner
argues that, at the time the adverted criminal case was instituted against her,
respondents essentially admitted that fraud attended the execution of the
subject deed of sale and that, therefore, respondents should be deemed to have
assailed the validity of the said contract.
Anent her alternative
cause of action, petitioner claims that the RTC ostensibly and irrelevantly
applied Section 118 of the Public Land Act.
She underscores instead Section 119 of the said law and stresses that
her right to repurchase the disputed land prescribes only after five years from
the date she conveyed the same to the respondents in 1989. Thus, she claims she timely exercised such
right when she instituted the complaint in 1993.
In
their Comment[10] and Memorandum,[11]
respondents argue that the provision of the Public Land Act which prohibits the
alienation of the disputed land within a period of five years reckoned from the
date of the issuance of the patent had lapsed along with the right to
repurchase the disputed land under the said law. The respondents further contend that the
petitioner conveyed the disputed land in bad faith and should not therefore be
allowed to come to court with unclean hands.
After evaluation of the
parties’ competing arguments, we find the petition devoid of merit.
We
simply cannot uphold petitioner’s contention that the deed of sale she executed
in favor of respondents should be declared null and void on the basis of the
previous deed of sale with right of repurchase petitioner executed in favor the
spouses Zuasola and Subida. Ostensibly,
when petitioner sold the subject property to herein respondents, she no longer
had any right to do so for having previously sold the same property to other
vendees. However, it is elementary that
he who comes to court must do so with clean hands.[12] Being the vendor in both sales, petitioner
knew perfectly well that when she offered the subject property for sale to
respondents she had already previously sold it to the spouses Zuasola and
Subida. It is undeniable then that
petitioner fraudulently obtained the consent of respondents in the execution of
the assailed deed of sale. She even
admits her conviction of the crime of estafa
for the deception she perpetrated on respondents by virtue of the double sale.
Certainly, petitioner’s
action for annulment of the subject deed should be dismissed based on Article
1397 of the Civil Code which provides that the person who employed fraud cannot
base his action for the annulment of contracts upon such flaw of the contract,
thus:
Art.
1397. The action for the annulment of
contracts may be instituted by all who are thereby obliged principally or
subsidiarily. However, persons who are
capable cannot allege the incapacity of those with whom they contracted; nor can those who exerted intimidation,
violence, or undue influence, or employed
fraud, or caused mistake base their
action upon these flaws of the contract.
Petitioner is, therefore, precluded from
seeking the annulment of the said contract based on the fraud which she herself
has caused.
The theory of petitioner that
the respondents should be deemed to have themselves assailed the validity of
the subject deed of sale, since the civil aspect of the criminal case for
estafa was impliedly instituted with the filing of said criminal action, is
bereft of legal basis. The civil action
impliedly instituted in a criminal case pertains only to the recovery of civil
liability arising from the offense charged.[13] Such civil action includes recovery of
indemnity under the Revised Penal Code, and damages under Articles 32, 33, 34
and 2176 of the Civil Code of the
In light of the peculiar
facts of this case, we also find no merit in petitioner’s alternative cause of
action that she should be allowed to repurchase the subject property from
respondents.
It is true that Section 118[15] of
the Public Land Act pertains to the prohibition of the sale or encumbrance of a
land acquired through free patent and homestead provision within a period of five years from the date of the issuance of the
patent or grant. On the other hand,
Section 119[16] of the
said law subjects said land’s alienation, impliedly after the expiration of the
prohibitive period, upon a right of repurchase by the homesteader, his widow,
or heirs, within a period of five years
from the date of its conveyance.
Indeed, these provisions complement the intent and purpose of the law “to
preserve and keep in the family of the homesteader that portion of public land
which the State had gratuitously given to him.”[17]
However, it is important to stress that the
ultimate objective of the law is “to promote public policy, that is, to provide
home and decent living for destitutes, aimed at providing a class of
independent small landholders which is the bulwark of peace and order.”[18] Our prevailing jurisprudence requires that
the motive of the patentee, his widow, or legal heirs in the exercise of their
right to repurchase a land acquired through patent or grant must be consistent
with the noble intent of the Public Land Act.
We held in a number of cases that the right to repurchase of a patentee
should fail if his underlying cause is contrary to everything that the Public Land
Act stands for. In Benzonan v. CA,[19]
we ruled:
In the light of
the records of these cases, we rule that respondent Pe cannot repurchase the
disputed property without doing violence to everything that CA No. 141 (as
amended) stands for.
We ruled in Simeon
v. Peña, 36 SCRA 610, 617 [1970] through Chief Justice Claudio
Teehankee, that:
xxx xxx xxx
"These
findings of fact of the Court of Appeals that "(E)vidently, the
reconveyance sought by the plaintiff (petitioner) is not in accordance with the
purpose of the law, that is, 'to preserve and keep in the family of the
homesteader that portion of public land which the State has gratuitously given
to him'" and expressly found by it to "find justification from the
evidence of record . . ."
"Under the
circumstances, the Court is constrained to agree with the Court of Appeals that petitioners' proposed repurchase of
the property [do] not fall within the purpose, spirit and meaning of section
119 of the
We reiterated
this ruling in Vargas v. Court of Appeals, 91 SCRA 195, 200, [1979] viz:
"As regards
the case of Simeon v. Peña,
petitioners ought to know that petitioner therein was not allowed to repurchase
because the lower court found that his
purpose was only speculative and for profit. In the present case, the Court of Appeals
found that herein petitioners' purposes and motives are also speculative and
for profit.
"It might be
well to note that the underlying principle of Section 119 of Commonwealth Act
No. 141 is to give the homesteader or patentee every chance to preserve for
himself and his family the land that the State had gratuitously given to him as
a reward for his labor in cleaning and cultivating it. (Simeon v. Peña, 36 SCRA
617). As found by the Court of Appeals,
the motive of the petitioners in repurchasing the lots in question being one
for speculation and profit, the same therefore does not fall within the
purpose, spirit and meaning of said section."
and in Santana et. al. v. Mariñas,
94 SCRA 853, 861-862 [1979] to wit:
"In
Simeon v. Peña we analyzed the
various cases previously decided, and arrived at the conclusion that the plain
intent, the raison d' etre, of Section 119, C.A. No. 141 '. . . is to give the
homesteader or patentee every chance to preserve for himself and his family the
land that the state had gratuitously given to him as a reward for his labor in
cleaning and cultivating it.' In the
same breath, we agreed with the trial court, in that case, that it is in this
sense that the provision of law in question becomes unqualified and
unconditional. And in keeping with such reasons behind the passage of the law, its
basic objective is to promote public policy, that is, to provide home and
decent living for destitutes, aimed at promoting a class of independent small
landholders which is the bulwark of peace and order."
"As
it was in Simeon v. Peña, respondent
Mariñas' intention in exercising the right of repurchase 'is not for the
purpose of preserving the same within the family fold,' but 'to dispose of it
again for greater profit in violation of the law's policy and spirit.' The foregoing conclusions are supported by the
trial court's findings of fact already cited, culled from evidence adduced. Thus respondent Mariñas was 71 years old and a
widower at the time of the sale in 1956; that he was 78 when he testified on
October 24, 1963 (or over 94 years old today if still alive); that . . . he was
not living on the property when he sold the same but was residing in the
poblacion attending to a hardware store, and that the property was no longer
agricultural at the time of the sale, but was a residential and commercial lot
in the midst of many subdivisions. The
profit motivation behind the effort to repurchase was conclusively shown when
the then plaintiff's counsel, in the case below, Atty. Loreto Castillo, in his
presence, suggested to herein petitioners' counsel, Atty. Rafael Dinglasan '. .
. to just add to the original price so the case would be settled.' Moreover,
Atty. Castillo manifested in court that an amicable settlement was possible,
for which reason he asked for time 'within which to settle the terms thereof
and that 'the plaintiff . . . Mr. Mariñas, has manifested to the Court that if
the defendants would be willing to pay the sum of One Peso and Fifty Centavos
(P1.50) per square meter, he would be willing to accept the offer and dismiss
the case."
Our decisions
were disregarded by the respondent court which chose to adopt a Court of Appeals
ruling in Lim, et al. v. Cruz, et al.,
CA-G.R. No. 67422, November 25, 1983 that the motives of the homesteader in
repurchasing the land are inconsequential" and that it does not matter
even "when the obvious purpose is for selfish gain or personal aggrandizement."
In
Heirs of Venancio Bajenting v. Bañez,[20]
we reiterated the doctrine applied in the above-cited cases as follows:
As elucidated by
this Court, the object of the provisions of Act 141, as amended, granting
rights and privileges to patentees or homesteaders is to provide a house for
each citizen where his family may settle and live beyond the reach of financial
misfortune and to inculcate in the individuals the feelings of independence
which are essential to the maintenance of free institution. The State is called upon to ensure that the
citizen shall not be divested of needs for support, and reclined to
pauperism. The Court, likewise,
emphasized that the purpose of such law is conservation of a family home in
keeping with the policy of the State to foster families as the factors of
society, and thus promote public welfare. The sentiment of patriotism and
independence, the spirit of citizenship, the feeling of interest in public
affairs, are cultivated and fostered more readily when the citizen lives
permanently in his own house with a sense of its protection and
durability. It is intended to promote
the spread of small land ownership and the preservation of public land grants
in the names of the underprivileged for whose benefits they are specially
intended and whose welfare is a special concern of the State. The law is intended to commence ownership of
lands acquired as homestead by the patentee or homesteader or his heirs.
In Simeon v. Peña, the Court declared that
the law was enacted to give the homesteader or patentee every chance to
preserve for himself and his family the land that the State had gratuitously
given to him as a reward for his labor in cleaning and cultivating it. In that
sense, the law becomes unqualified and unconditional. Its
basic objective, the Court stressed, is to promote public policy, that is, to
provide home and decent living for destitutes, aimed at providing a class of
independent small landholders which is the bulwark of peace and order.
To ensure the
attainment of said objectives, the law gives the patentee, his widow or his
legal heirs the right to repurchase the property within five years from date of
the sale. However, the patentee, his widow or legal heirs should not be allowed
to take advantage of the salutary policy of the law to enable them to recover
the land only to dispose of it again to amass a hefty profit to themselves. The
Court cannot sustain such a transaction which would put a premium on
speculation which is contrary to the philosophy behind Section 119 of Act 141,
as amended.
Analogous to the
rationale in the foregoing cited cases, we cannot sustain the right to
repurchase of a patentee when such repurchase would reward rather than sanction
an act of injustice committed by her in her fraudulent dealings with land that
she acquired from the government under the Public Land Act. We uphold the CA’s finding that petitioner is
guilty of bad faith and that she only made efforts to repurchase the property
from the first buyers after an information for estafa had been filed against
her by the second buyers. To be sure,
petitioner only made an effort to enforce her right to repurchase from the
second buyers (by filing the complaint subject of the present petition) during
the pendency of the said criminal action for estafa. Indeed, petitioner’s successive conveyances
of the disputed land for valuable consideration to different vendees clearly
indicate the profit-making motive of petitioner and her lack of intention to
preserve the land for herself and her family.
This Court cannot countenance such a betrayal of the ultimate objective
of the law.
In
view of the foregoing, the appellate court did not commit any reversible error
in its assailed decision and resolution.
WHEREFORE, the petition of Barceliza P. Capistrano is hereby DENIED for lack of merit.
SO ORDERED.
TERESITA J.
LEONARDO-DE CASTRO
Associate Justice
WE CONCUR:
REYNATO S. PUNO
Chief Justice
Chairperson
|
ANTONIO T. CARPIO Associate Justice |
RENATO C. CORONA Associate Justice |
ADOLFO S. AZCUNA
Associate Justice
C E R T I F I C A T I O N
Pursuant to
Section 13, Article VIII of the Constitution, I certify 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] Penned by Associate Justice Eubulo G. Verzola with Associate Justices Marina L. Buzon and Bienvenido L. Reyes concurring; rollo, pp. 71-76.
[2]
[3]
[4] Id. at pp. 49-50.
[5]
[6] Ibid.
[7] Id. at pp. 47-48.
[8] Id. at p. 75.
[9] Citing Article 1318 in relation to Articles 1350 and 1353 of the Civil Code as follows:
Art. 1318. There is no contract unless the following requisites concur:
1) Consent of the contracting parties;
2) Object certain which is the subject matter of the contract;
3) Cause of the obligation which is established.
Art. 1350. In onerous contracts the cause is understood to be, for each contracting party, the prestation or promise of a thing or service by the other; xxx xxx xxx
Art.1353. The statement of a false cause in contracts shall render them void, if it should not be proved that they were founded upon another cause which is true and lawful.
[10] Rollo, pp. 90-92.
[11]
[12] Dequito v. Llamas, G.R. No. L-28090, September 4, 1975, 66 SCRA 504, 510; Camporedondo v. National Labor Relations Commission, G.R. No. 129049, August 6, 1999, 312 SCRA 47, 48.
[13] Rules of Court, Rule 111, Section 1.
[14]
[15] C.A. No.
141, Sec. 118: Except in favor of the
Government or any of its branches, units or institutions, or legally
constituted banking corporations, lands acquired under free patent or homestead
provisions shall not be subject to encumbrance or alienation from the date of
the approval of the application and for a term of five years from and after the
date of issuance of the patent or grant nor shall they become liable to the
satisfaction of any debt contracted prior to the expiration of said period; but
the improvements or crops on the land may be mortgaged or pledged to qualified
persons, associations, or corporations.
No alienation, transfer, or conveyance of any
homestead after five years and before twenty-five years after issuance of title
shall be valid without the approval of the Secretary of Agriculture and Natural
Resources, which approval shall not be denied except on constitutional and
legal grounds.
[16] C.A. No. 141, Sec. 119: Every conveyance of land acquired under the free patent and homestead provisions, when proper, shall be subject to repurchase by the applicant, his widow, or legal heirs, within a period of five years from the date of conveyance.
[17] Rural Bank of Davao City, Inc. v. Court of Appeals, G.R. No. 83992, January 27, 1993, 217 SCRA 554, 563-564, citing Pascua v. Talens, 80 Phil. 792, 793-794.
[18] Benzonan v. CA, G.R. Nos. 97973 and 97998, January 27, 1992, 205 SCRA 515, 524-526.
[19] Supra.
[20] G.R. No. 166190, September 20, 2006, 502 SCRA 531.