Wills and Succession 1st Assignment SBCLAW Atty. Taleon

Republic of the Philippines

SUPREME COURT Manila THIRD DIVISION

G.R. No. L-68053 May 7, 1990 LAURA ALVAREZ, FLORA ALVAREZ and RAYMUNDO ALVAREZ, petitioners, vs.

THE HONORABLE INTERMEDIATE APELLATE COURT and JESUS YANES, ESTELITA YANES, ANTONIO YANES, ROSARIO YANES, and ILUMINADO YANES,

respondents. Francisco G. Banzon for petitioner. Renecio R. Espiritu for private respondents.

FERNAN, C.J.: This is a petition for review on certiorari seeking the reversal of: (a) the decision of the Fourth Civil Cases Division of the Intermediate Appellate Court dated August 31, 1983 in AC-G.R. CV No. 56626 entitled "Jesus Yanes et al. v. Dr. Rodolfo Siason et al." affirming  the decision dated July 8, 1974 of the Court of First Instance of Negros Occidental insofar as it ordered the petitioners to pay jointly and severally the private respondents the sum of P20,000.00 representing the actual value of Lots Nos. 773-A and 773-B of the cadastral survey of Murcia, Negros Occidental and reversing  the subject decision insofar as it awarded the sums of P2,000.00, P5,000.00 and P2,000.00 as actual damages, moral damages and attorney's fees, respectively and (b) the resolution of said appellate court dated May 30, 1984, denying the motion for reconsideration of its decision. The real properties involved are two parcels of land identified as Lot 773-A and Lot 773-B which were originally known as Lot 773 of the cadastral survey of Murcia, Negros Occidental. Lot 773, with an area of 156,549 square meters, was registered in the name of

the heirs of Aniceto Yanes under Original Certificate of Title No. RO-4858 (8804) issued on October 9, 1917 by the Register of Deeds of Occidental Negros (Exh. A). Aniceto Yanes was survived by his children, Rufino, Felipe and Teodora. Herein private respondents, Estelita, Iluminado and Jesus, are the children of Rufino who died in 1962 while the other private respondents, Antonio and Rosario Yanes, are children of Felipe. Teodora was survived by her child, Jovita (Jovito) Alib. 1 It is not clear why the latter is not included as a party in this case. Aniceto left his children Lots 773 and 823. 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 the children of Felipe 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 therein, he was informed that Fortunato Santiago, Fuentebella (Puentevella) and Alvarez were in possession of Lot 773.

2

It is on record that on May 19, 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. 3 TCT No. RF 2694 describes Lot 773-A as a portion of Lot 773 of the cadastral survey of Murcia and as originally registered under OCT No. 8804. The bigger portion of Lot 773 with an area of 118,831 square meters was also registered in the name of Fortunato D. Santiago on September 6, 1938 Under TCT No. RT-2695 (28192 ). 4 Said transfer certificate of title also contains a certification to the effect that Lot 773-B was originally registered under OCT No. 8804.

On May 30, 1955, Santiago sold Lots 773-A and 773-B to Monico B. Fuentebella, Jr. in consideration of the sum of P7,000.00. 5 Consequently, on February 20, 1956, TCT Nos. T-19291 and T-19292 were issued in Fuentebella's name. 6 After Fuentebella's death and during the settlement of his estate, the administratrix thereof (Arsenia R. Vda. de Fuentebella, his wife) filed in Special Proceedings No. 4373 in the Court of First Instance of Negros Occidental, a motion requesting authority to sell Lots 773-A and 773B. 7 By virtue of a court order granting said motion, 8 on March 24, 1958, Arsenia Vda. de Fuentebella sold said lots for P6,000.00 to Rosendo Alvarez. 9 Hence, on April 1, 1958 TCT Nos. T-23165 and T-23166 covering Lots 773-A and 773-B were respectively issued to Rosendo Alvarez. 10 Two years later or on May 26, 1960, Teodora Yanes and the children of her brother Rufino, namely, 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. They also prayed that an accounting of the produce of the land from 1944 up to the filing of the complaint be made by the defendants, that after court approval of said accounting, the share or money equivalent due the plaintiffs be delivered to them, and that defendants be ordered to pay plaintiffs P500.00 as damages in the form of attorney's fees. 11 During the pendency in court of said case or on November 13, 1961, Alvarez sold Lots 773-A, 773-B and another lot for P25,000.00 to Dr. Rodolfo Siason. 12 Accordingly, TCT Nos. 30919 and 30920 were issued to Siason, 13  who thereafter, declared the two lots in his name for assessment purposes. 14 Meanwhile, on November 6, 1962, Jesus Yanes, in his own behalf and in behalf of the other plaintiffs, and

assisted by their counsel, filed a manifestation in Civil Case No. 5022 stating that the therein plaintiffs si c ) any claim, "renounce, forfeit and quitclaims ( sic  monetary or otherwise, against the defendant Arsenia Vda. de Fuentebella in connection with the above-entitled case." 15 On October 11, 1963, a decision was rendered by the Court of First Instance of Negros Occidental in Civil Case No. 5022, the dispositive portion of which reads: WHEREFORE, judgment is rendered, ordering the defendant Rosendo Alvarez to reconvey to the plaintiffs lots Nos. 773 and 823 of the Cadastral Survey of Murcia, Negros Occidental, now covered by Transfer Certificates of Title Nos. T-23165 and T-23166 in the name of said defendant, and thereafter to deliver the possession of said lots to the plaintiffs. No special pronouncement as to costs. SO ORDERED. 16 It will be noted that the above-mentioned manifestation of Jesus Yanes was not mentioned in the aforesaid decision. However, execution of said decision proved unsuccessful with respect to Lot 773. In his return of service dated October 20, 1965, the sheriff stated that he discovered that Lot 773 had been subdivided into Lots 773-A and 773-B; that they were "in the name" of Rodolfo Siason who had purchased them from Alvarez, and that Lot 773 could not be delivered to the plaintiffs as Siason was "not a party per writ of execution." 17 The execution of the decision in Civil Case No. 5022 having met a hindrance, herein private respondents (the Yaneses) filed on July 31, 1965, in the Court of First Instance of Negros Occidental a petition for the issuance of a new certificate of title and for a declaration of nullity of TCT Nos. T-23165 and T-23166 issued to Rosendo Alvarez. 18 Thereafter, the court required Rodolfo Siason to produce the certificates of title covering Lots 773 and 823.

Expectedly, Siason filed a manifestation stating that he purchased Lots 773-A, 773-B and 658, not Lots 773 and 823, "in good faith and for a valuable consideration without any knowledge of any lien or encumbrances against said properties"; that the decision in the cadastral proceeding 19 could not be enforced against him as he was not a party thereto; and that the decision in Civil Case No. 5022 could neither be enforced against him not only because he was not a party-litigant therein but also because it had long become final and executory. 20 Finding said manifestation to be well-founded, the cadastral court, in its order of September 4, 1965, nullified its previous order requiring Siason to surrender the certificates of title mentioned therein. 21 In 1968, the Yaneses filed an ex-parte motion for the issuance of an alias writ of execution in Civil Case No. 5022. Siason opposed it. 22 In its order of September 28, 1968 in Civil Case No. 5022, the lower court, noting that the Yaneses had instituted another action for the recovery of the land in question, ruled that at the  judgment therein could not be enforced against Siason as he was not a party in the case. 23 The action filed by the Yaneses Yaneses on February 21, 1968 was for recovery of real property with damages. 24 Named defendants therein were Dr. Rodolfo Siason, Laura Alvarez, Flora Alvarez, Raymundo Alvarez and the Register of Deeds of Negros Occidental. The Yaneses prayed for the cancellation of TCT Nos. T-19291 and 19292 issued to Siason (sic ) for being null and void; the issuance of a new certificate of title in the name of the Yaneses "in accordance with the sheriffs return of service dated October 20, 1965;" Siason's delivery of possession of Lot 773 to the Yaneses; and if, delivery thereof could not be effected, or, or, if the issuance of a new title could not be made, that the Alvarez and Siason jointly and severally pay the Yaneses the sum of P45,000.00. They also prayed that Siason render an accounting of the fruits of Lot 773 from November 13, 1961 until the filing of the

complaint; and that the defendants jointly and severally pay the Yaneses moral damages of P20,000.00 and exemplary damages of P10,000.00 plus attorney's fees of P4, 000.00. 25 In his answer to the complaint, Siason alleged that the validity of his titles to Lots 773-A and 773-B, having been passed upon by the court in its order of September 4, 1965, had become res judicata  and the Yaneses were estopped from questioning said order. 26 On their part, the Alvarez stated in their answer that the Yaneses' cause of action had been "barred by res judicata, statute of limitation and estoppel." 27 In its decision of July 8, 1974, the lower court found that Rodolfo Siason, who purchased the properties in question thru an agent as he was then in Mexico pursuing further medical studies, was a buyer in good faith for a valuable consideration. Although the Yaneses were negligent in their failure to place a notice of lis pendens  "before the Register of Deeds of Negros Occidental in order to protect their rights over the property in question" in Civil Case No. 5022, equity demanded that they recover the actual value of the land because the sale thereof executed between Alvarez and Siason was without court approval. 28 The dispositive portion of the decision states: IN VIEW OF THE FOREGOING CONSIDERATION,  judgment is hereby rendered rendered in the following manner: A. The case against the defendant Dr. Rodolfo Siason and the Register of Deeds are ( sic ) hereby dismmissed, B. The defendants, Laura, Flora and Raymundo, all surnamed Alvarez being the legitimate children of the deceased Rosendo Alvarez are hereby ordered to pay  jointly and severally the plaintiffs the sum of P20,000.00 representing the actual value of Lots Nos. 773-A and 773-B of Murcia Cadastre, Negros Occidental; the sum of P2,000.00 as actual damages suffered by the plaintiff; the sum of P5,000.00 representing moral damages and the sum of P2.000 as attorney's fees, all with legal rate of

interest from date of the filing of this complaint up to final payment. C. The cross-claim filed by the defendant Dr. Rodolfo Siason against the defendants, Laura, Flora and Raymundo, all surnamed Alvarez is hereby dismissed. D. Defendants, Laura, Flora and Raymundo, all surnamed Alvarez are hereby ordered to pay the costs of this suit. SO ORDERED. 29 The Alvarez appealed to the then Intermediate Appellate Court which in its decision of August 31, 1983 30 affirmed the lower court's decision "insofar as it ordered defendants-appellants to pay jointly and severally the plaintiffs-appellees the sum of P20,000.00 representing the actual value of Lots Nos. 773-A and 773-B of the cadastral survey of Murcia, Negros Occidental, and is reversed insofar as it awarded the sums of P2,000.00, P5,000.00 and P2,000.00 as actual damages, moral damages and attorney's fees, respectively." 31 The dispositive portion of said decision reads: WHEREFORE, the decision appealed from is affirmed insofar as it ordered defendants-appellants to pay jointly and severally the plaintiffs- appellees the sum of P20,000.00 representing the actual value of Lots Nos. 773-A and 773-B of the cadastral survey of Murcia, Negros Occidental, and is reversed insofar as it awarded the sums of P2,000.00, P5,000.00 and P2,000.00 as actual damages, moral damages and attorney's fees, respectively. No costs. SO ORDERED. 32 Finding no cogent reason to grant appellants motion for reconsideration, said appellate court denied the same. Hence, the instant petition. ln their memorandum petitioners raised the following issues: 1. Whethere or not the defense of prescription and estoppel had been timely and properly invoked and raised by the petitioners in the lower court. 2. Whether or not the cause and/or causes of action of the private respondents, if ever there are any, as alleged

in their complaint dated February 21, 1968 which has been docketed in the trial court as Civil Case No. 8474 supra, are forever barred by statute of limitation and/or prescription of action and estoppel. 3. Whether or not the late Rosendo Alvarez, a defendant in Civil Case No. 5022, supra and father of the petitioners become a privy and/or party to the waiver (Exhibit 4defendant Siason) in Civil Case No. 8474, supra where the private respondents had unqualifiedly and absolutely waived, renounced and quitclaimed all their alleged rights and interests, if ever there is any, any, on Lots Nos. 773-A and 773-B of Murcia Cadastre as appearing in their written manifestation dated November 6, 1962 (Exhibits "4" Siason) which had not been controverted or even impliedly or indirectly denied by them. 4. Whether or not the liability or liabilities of Rosendo Alvarez arising from the sale of Lots Nos. 773-A and 773B of Murcia Cadastre to Dr. Rodolfo Siason, if ever there is any, could be legally passed or transmitted by operations (sic ) of law to the petitioners without violation of law and due process . 33 The petition is devoid of merit. As correctly ruled by the Court of Appeals, it is powerless and for that matter so is the Supreme Court, to review the decision in Civil Case No. 5022 ordering Alvarez to reconvey the lots in dispute to herein private respondents. Said decision had long become final and executory and with the possible exception of Dr. Siason, who was not a party to said case, the decision in Civil Case No. 5022 is the law of the case between the parties thereto. It ended when Alvarez or his heirs failed to appeal the decision against them. 34 Thus, it is axiomatic 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. 35 As consistently ruled by this Court, every litigation must come to an end. Access to

the court is guaranteed. But there must be a limit to it. Once a litigant's right has been 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. For, if endless litigation were to be allowed, unscrupulous litigations will multiply in number to the detriment of the administration of justice. 36 There is no dispute that the rights of the Yaneses to the properties in question have been finally adjudicated in Civil Case No. 5022. As found by the lower court, from the uncontroverted evidence presented, the Yaneses have been illegally deprived of ownership and possession of the lots in question. 37 In fact, Civil Case No. 8474 now under review, arose from the failure to execute Civil Case No. 5022, as subject lots can no longer be reconveyed to private respondents Yaneses, the same having been sold during the pendency of the case by the petitioners' father to Dr. Siason who did not know about the controversy, there being no lis pendens annotated on the titles. Hence, it was also settled beyond question that Dr. Siason is a purchaser in good faith. Under the circumstances, the trial court did not annul the sale executed by Alvarez in favor of Dr. Siason on November 11, 1961 but in fact sustained it. The trial court ordered the heirs of Rosendo Alvarez who lost in Civil Case No. 5022 to pay the plaintiffs (private respondents herein) the amount of P20,000.00 representing the actual value of the subdivided lots in dispute. It did not order defendant Siason to pay said amount. 38 As to the propriety of the present case, it has long been established that 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. 39 "It is one thing to

protect an innocent third party; it is entirely a different matter and one devoid of justification if deceit would be rewarded by allowing the perpetrator to enjoy the fruits of his nefarious decided As clearly revealed by the undeviating line of decisions coming from this Court, such an undesirable eventuality is precisely sought to be guarded against." 40 The issue on the right to the properties in litigation having been finally adjudicated in Civil Case No. 5022 in favor of private respondents, it cannot now be reopened in the instant case on the pretext that the defenses of prescription and estoppel have not been properly considered by the lower court. Petitioners could have appealed in the former case but they did not. They have therefore foreclosed their rights, if any, and they cannot now be heard to complain in another case in order to defeat the enforcement of a judgment which has longing become final and executory. executory. Petitioners further contend that the liability arising from the sale of Lots No. 773-A and 773-B made by Rosendo Alvarez to Dr. Rodolfo Siason should be the sole liability of the late Rosendo Alvarez or of his estate, after his death. Such contention is untenable for it overlooks the doctrine obtaining in this jurisdiction on the general transmissibility of the rights and obligations of the deceased to his legitimate children and heirs. Thus, the pertinent provisions of the Civil Code state: Art. 774. Succession is a mode of acquisition by virtue of which the property, 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. Art. 776. The inheritance includes all the property, rights and obligations of a person which are not extinguished by his death. Art. 1311. Contract stake effect only between the parties, their assigns and heirs except in case where the rights

and obligations arising from the contract are not transmissible by their nature, or by stipulation or by provision of law. The heir is not liable beyond the value of the property received from the decedent. As explained by this Court through Associate Justice J.B.L. Reyes in the case of Estate of Hemady vs. Luzon Surety Co., Inc. 41 The binding effect of contracts upon the heirs of the deceased party is not altered by the provision of 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 (Rule 89). The reason is that whatever payment is thus made from the state is ultimately a payment by the heirs or distributees, since the amount of the paid claim in fact diminishes or reduces the shares that the heirs would have been entitled to receive. Under our law, therefore. the general rule is that a party's contractual rights and obligations are transmissible to the successors. The rule is a consequence of the progressive "depersonalization" of patrimonial rights and duties that, as observed by Victorio Polacco has characterized the history of these institutions. From the Roman concept of a relation from person to person, the obligation has evolved into a relation from patrimony to patrimony with the persons occupying only a representative position, barring those rare cases where the obligation is strictly personal, i . e ., is contracted intuitu personae, in consideration of its performance by a specific person and by no other. xxx xxx xxx Petitioners being the heirs of the late Rosendo Alvarez, they cannot escape the legal consequences of their father's transaction, which gave rise to the present claim for damages. That petitioners did not inherit the property involved herein is of no moment because by legal fiction, the monetary equivalent thereof devolved into the mass

of their father's hereditary estate, and we have ruled that the hereditary assets are always liable in their totality for the payment of the debts of the estate. 42 It must, however, be made clear that petitioners are liable only to the extent of the value of their inheritance. With this clarification and considering petitioners' admission that there are other properties left by the deceased which are sufficient to cover the amount adjudged in favor of private respondents, we see no cogent reason to disturb the findings and conclusions of the Court of Appeals. WHEREFORE, subject to the clarification herein above stated, the assailed decision of the Court of Appeals is hereby AFFIRMED. Costs against petitioners. SO ORDERED. Gutierrez, Jr., Feliciano and Cortes, JJ., concur. Bidin J., took no part.

Republic of the Philippines

SUPREME COURT

Manila SECOND DIVISION

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   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: 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) Psd-80450 duly approved by the Land Registration Commission, Lot 2476-D, 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) 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. T-1183 T-1183 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, 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. 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. 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. CAG.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, 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.

Republic of the Philippines

SUPREME COURT Manila FIRST DIVISION

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 Law Offices for petitioners. Mabella, Sangil & Associates for private respondents.

NARVASA, C.J.: Reversal of the decision of the Court of Appeals in CAG.R. No. CV-11186 — 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, 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  ,  brothers and sisters or nephews and relatives" (i .e. , 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, Doña 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, 6  Catalina 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, Doña Catalina was closest to her nephew, Attorney Salvador Lorayes, her nieces, Elena Jaucian, Maria LorayesCornelio and Maria Olbes-Velasco, and the husbands of the last two: Hostilio Cornelio and Fernando Velasco. 8 Her 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 Doña 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, Doña 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 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, Doña 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. 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. 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 Doña 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. In 1989, or six (6) years after Doña 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 Doña 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 Doña 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  , "the property not form part of her hereditary estate, i .e. , and transmissible rights and obligations existing 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 Doña 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 Doña 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 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 Doña 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, Doña 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 5,000-sq.m. portion of Lot 2020 to Julian Locsin. 15 On March 27, 1967, Lot 2020 16 was partitioned by and among Doña 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 Doña, 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 Doña 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, Doña 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 Doña 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 (Doña 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 Doña 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 Doña 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 LorayesCornelio 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 Doña Catalina acted as a completely free agent when she made the conveyances in favor of the petitioners. In fact, considering their closeness to Doña 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. Doña 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 Doña 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 Doña 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, Griño-Aquino and Medialdea, JJ . ,  , concur.

Republic of the Philippines

SUPREME COURT Manila FIRST DIVISION

G.R. No. 125835 July 30, 1998 NATALIA CARPENA OPULENCIA, petitioner, vs.

COURT OF APPEALS, ALADIN SIMUNDAC and MIGUEL OLIVAN, respondents. PANGANIBAN, J.: Is a contract to sell a real property involved in restate 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 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 Petitioner's Motion for Reconsideration was denied in the challenged Resolution. 5 The Facts 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, attorney's 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 (petitioner's father), in respect of which a petition for probate was filed with the Regional Trial Court, Branch 24, Biñan, 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 d enying 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 (defendant's 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 defendant's 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 decedent's 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 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 [petitioner's] demurrer to evidence. 6 The trial court's 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 Respondent's Ruling

Declaring the Contract to Sell valid, subject to the outcome of the testate proceedings on Demetrio Carpena's estate, the appellate court set aside the trial court's 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 court's 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: xxx xxx xxx xxx xxx xxx xxx xxx xxx

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," 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 BUYER's Licensed Geodetic Engineer, 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. xxx xxx xxx 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 Biñan, 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