PARDELL v. BARTOLOME

Facts: Petitioner Vicenta Ortiz y Felin de Pardell and respondent Matilde Ortiz y Felin Bartolome were

the existing heirs of the late Miguel Ortiz and Calixta Felin. On 1888, Matilde and co-defendant

Gaspar de Bartolome y Escribano took it upon themselves without an judicial authorization or even

extra judicial agreement the administration of the properties of the late Calixta and Miguel. These

properties included a house in Escolta Street, Vigan, Ilocos Sur; a house in Washington Street, Vigan,

Ilocos Sur; a lot in Magallanes Street, Vigan, Ilocos Sur; parcels of rice land in San Julian and Sta.

Lucia; and parcels of land in Candon, Ilocos Sur.

Vicenta filed an action in court asking that the judgement be rendered in restoring and returning to

them one half of the total value of the fruits and rents, plus losses and damages from the

aforementioned properties. However, respondent Matilde asserted that she never refused to give the

plaintiff her share of the said properties. Vicenta also argued that Matilde and her husband, Gaspar

are obliged to pay rent to the former for their occupation of the upper story of the house in Escolta

Street.

Issue: Whether or not Matilde and Gaspar are obliged to pay rent for their occupation of the said

property

Held: No. The Court ruled that the spouses are not liable to pay rent. Their occupation of the said

property was a mere exercise of their right to use the same as a co-owner. One of the limitations on a

co-owner’s right of use is that he must use it in such a way so as not to injure the interest of the other

co-owners. In the case at bar, the other party failed to provide proof that by the occupation of the

spouses Bartolome, they prevented Vicenta from utilizing the same

GATCHALIAN v. COLLECTOR OF INTERNAL REVENUE

Facts: Plaintiffs purchased, in the ordinary course of business, from one of the duly authorized agents

of the National Charity Sweepstakes Office one ticket for the sum of two pesos (P2), said ticket was

registered in the name of Jose Gatchalian and Company. The ticket won one of the third-prizes in the

amount of P50,000.

Jose Gatchalian was required to file the corresponding income tax return covering the prize won.

Defendant-Collector made an assessment against Jose Gatchalian and Co. requesting the payment

of the sum of P1,499.94 to the deputy provincial treasurer of Pulilan, Bulacan. Plaintiffs, however

through counsel made a request for exemption. It was denied.

Plaintiffs failed to pay the amount due, hence a warrant of distraint and levy was issued. Plaintiffs paid

under protest a part of the tax and penalties to avoid the effects of the warrant. A request that the

balance be paid by plaintiffs in installments was made. This was granted on the condition that a bond

be filed.

Plaintiffs failed in their installment payments. Hence a request for execution of the warrant of distraint

and levy was made. Plaintiffs paid under protest to avoid the execution.

A claim for refund was made by the plaintiffs, which was dismissed, hence the appeal.

Issue: Whether the plaintiffs formed a partnership hence liable for income tax.

Held: Yes. According to the stipulation facts the plaintiffs organized a partnership of a civil nature

because each of them put up money to buy a sweepstakes ticket for the sole purpose of dividing

equally the prize which they may win, as they did in fact in the amount of P50,000. The partnership

was not only formed, but upon the organization thereof and the winning of the prize, Jose Gatchalian

personally appeared in the office of the Philippines Charity Sweepstakes, in his capacity as co-

partner, as such collection the prize, the office issued the check for P50,000 in favor of Jose

Gatchalian and company, and the said partner, in the same capacity, collected the said check. All

these circumstances repel the idea that the plaintiffs organized and formed a community of property

only.

FIRST DIVISION

[G.R. No. 18009. January 10, 1923. ]

EMILIO PUNSALAN ET AL., Plaintiffs-Appellants, v. C. BOON LIAT ET AL., Defendants-

Appellants.

Yeager & Armstrong, C. A. Sobral and Lorenzo & Manalac for plaintiffs and appellants.

Kincaid, Perkins & Kincaid and P. J. Moore for defendants and appellants.

SYLLABUS

1. AMBERGRIS; OCCUPANCY; PROPERTY IN COMMON; SALE BY SOME COOWNERS. — The ambergris which is the subject-matter of this litigation was the undivided common property of the plaintiffs and

one of the defendants. This common ownership was acquired by occupancy. None of them had any right to sell said amber, there being an express agreement between the coowners not to sell it without the

consent of all. Held: That the two sales mentioned in the opinion having been made without the consent of all the coowners, the same have no effect, except as to the portion belonging to those who made

them.

2. ID.; ID.; ID.; ACTION FOR RECOVERY. — The right of action for recovery pertaining to each coowner, derived from the right of ownership inherent in the coownership, can be exercised not only against

strangers, but against the coowners themselves when the latter perform with respect to the thing held in common acts for their exclusive benefit, or of exclusive ownership, or which are prejudicial to, and in

violation of, the right of the community.

D E C I S I O N

AVANCEÑA, J. :

On or about the 13th of July, 1920, a Moro by the name of Tamsi saw from the Cawit-Cawit shores in the Province of Zamboanga, a big bulky object in the distance which attracted his attention. Thereupon, together with on another Moro named Bayrula, he went in a small boat to investigate and found it to be a large fish. They then returned to shore, where they met other Moros and requested their help to catch the fish. They went in three small boats, there being ten in one, seven in the other, and five in the third, twenty-two men in all, twenty-one of whom are plaintiffs herein, and the remaining one named Ahamad

is defendant. After having arrived at the place where the fish was, which was found to be a whale, they proceeded to pull it toward the shore up to the mouth of the river, where they quartered it, having found in its abdomen a great quantity of ambergris, which was placed in three sacks, two of which were full and the other half full, and taken to the house of Maharaja Butu, where they left it to the care of Ahamad. Then the contents of the two full sacks were placed in three trunks. All of these twenty-two persons made an agreement that they were to be the sole owners of this ambergris and that none of

them could sell it without the consent of the rest. As to the half of amber they agreed that some of them should take it to Zamboanga to sell for the purpose of ascertaining the market price of the ambergris, in order that they might dispose of the rest accordingly. Some of them, with Tamsi in charge, went to Zamboanga to sell the half sack of amber where they did dispose of it to a Chinaman, Cheong Tong, for the sum of P2,700, which amount was distributed among all the parties in interest. Then they offered to sell for the sum of P12,000 to the Chinamen, Cheong Tong and Lim Chiat, the rest of the amber contained in the two sacks which had been left in the house of Maharaja Butu, for safekeeping, and a document (Exhibit A) to this effect was executed by Lim Chiat and Cheong Tong, on the one hand, and Tamsi, Imam Lumuyod, and Imam Asakil, on the other. Thereupon they went to Cawit-Cawit on board the launch Ching-kang to get the amber so sold. It appears that there were other people in Zamboanga who knew of the existence of this ambergris in

the house of maharaha Butu. While the above related events were taking place, Mr. Henry E. Teck, who was one of those having knowledge of the existence of this amber in Cawit-Cawit and of the fact that the launch Ching-kang had left for Cawit-Cawit, proposed to the master of the revenue cutter Mindoro to go to Cawit-Cawit to seize some supposedly contraband opium. After transmitting this information to the Collector of Customs, he, the master of the Mindoro, immediately proceeded to Cawit-Cawit. There were on board the vessel Mr. Teck, some Chinamen, among whom were C. Boon Liat, Ong Chua, and Go Tong, and some Moros who, according to Mr. Teck, were to assist in the arrest of the smugglers. Upon the arrival of the Mindoro at Cawit-Cawit, the master, accompanied by Mr. Teck and some Moros, went to the house of Maharaja Butu. As is to be presumed, this information about the supposed contraband opium was but a trick to have the Mindoro at their disposal. The master proceeded to search the house, stating that he had information to the effect that there was contraband opium and as a result of the search, he found three large trunks containing a black substance which had a bad odor. He then asked

the owner of the house to whom those three trunks belonged, and the latter pointed to Ahamad who was present and who stated that the contents came from the abdomen of a large fish. The master, however, said that it was opium and told Ahamad that he would take the three trunks on board the ship. Then Ahamad and other Moros asked permission of the master accompany him on the voyage to Zamboanga, to which the master consented. When already on board and during the voyage the master consented. When already on board and during the voyage the master became convinced that the contents of the three trunks were not opium. During the voyage, Mr. Teck offered to purchase the amber contained in the three trunks, but Ahamad refused to sell it for the reason that he was not the sole owner thereof, but owned it in common with other persons who were in Zamboanga. However Mr. Teck, aided by his companions who wielded some

influence in Zamboanga, insisted that Ahamd should sell them the amber, telling him not to be afraid of his companions, as he would answer for whatever might happen. With this promise of protection, Ahamad decided to sell the amber for P7,500 and received P2,500 as part payment on account of this price, a bill of sale having been signed by Ahamadm, Maharaja Butu and three Moros more. The balance of this price was paid later. When Cheong Tong, Lim Chiat, and the Moros who had gone to Cawit-Cawit on board the launch Ching-kang arrived at the house of Maharaja Butu, they found that the amber they had purchased from Tamsi and his companions was no longer there. The plaintiffs are twenty-one of the twenty-two Moros who had caught the whale, and Lim Chiat and Cheong Tong, who had purchased from Tamsi and his companions the amber contained in the three

trunks deposited in the house of Maharaja Butu for safekeeping. They claim the 80 1/2 kilos of ambergris contained in the three trunks, or its value in the amount of P60,000, and damages in the sum of P20,000. This action is brought against C. Boon Liat, Ong Chua, Go Tong, Henry E. Teck, and the Moro, Ahamad, the first four being the persons who purchased this same amber from the one last named while on board the revenue cutter Mindoro. It appears from the foregoing that the amber in question was the undivided common property of the plaintiffs (with the exception of Lim Chiat and Cheong Tong) and the defendant Ahamad. This common ownership was acquired by occupancy (arts. 609 and 610 of the Civil Code), so that neither Tamsim Imam Lumuyod, or Imam Asakil had any right to sell it, as they did, to Lim Chiat and Cheong Tong, nor had the Moro Ahamad any right to sell this same amber, as he did, to C. Boon Liat, Ong Chua, Go Tong,

and Henry E. Teck. There was an agreement between the coowners not to sell this amber without the consent of all. Both sales having been made without the consent of all the owners, the same have no effect, except as to the portion pertaining to those who made them (art 399, Civil Code).

Although the original complaint filed in this case was entitled as one for replevin, in reality, from its allegations, the action herein brought is the ordinary one for the recovery of the title to, and possession of, this amber. It is no bar to the bringing of this action that the defendant Ahamad is one of the coowners. The action for recovery which each coowner has, derived from the right of ownership inherent in the coownership, may be exercised not only against strangers but against the coowners themselves,

when the latter perform, with respect to the thing held in common, acts for their exclusive benefit, or of exclusive ownership, or which are prejudicial to, and in violation of, the right of the community. (Decision of the supreme court of Spain of June 22, 1892.) In this case the selling of the amber by the defendant Ahamad as his exclusive property and his attitude in representing himself to be the sole owner thereof place him in the same position as the stranger who violates any right of the community. He is not sued in this case as coowner, for the cause of action is predicated upon the fact that he has acted not as coowner, but as an exclusive owner of the amber sold by him. As to the sale made by Ahamad, it is urged that the purchasers acted in good faith. It is contended that the latter did not know that the amber belonged to some others besides Ahamad. but the evidence shows other wise. Henry E. Teck himself admitted that on the occasion of the sale of the amber he really had promised Ahamad to protect him, and although he said that the promise made by him had reference

to the contingency of the amber proving to be opium, as the master of the revenue cutter Mindoro believed, this is incredible, because he could not make Ahamad a promise, nor could such a promise, if made, have any influence on the mind of Ahamad, inasmuch as the latter knew that the amber was not opium. If, as Henry E. Teck admits, he made Ahamad this promise of protection, it should have been only on account of Ahamad’s refusal to sell the amber due to the fact that he was not the sole owner thereof. With regard to the action of the trial court in not admitting Exhibits 1 and 2 offered by the defendants, we believe that it was no error. These documents are affidavits signed by Paslangan, and the best evidence of their contents was the testimony of Paslangan himself whom the plaintiffs had the right to cross-examine. Moreover, they are substantially the same as the statements made by Paslangan at the trial when testifying as witness for the defendants, and for this reason the ruling of the trial court

excluding these documents would not, at all events, affect the merits of the case. In the complaint it is alleged that the value of the amber is P60,000. Upon the evidence adduced on this point, and taking into account that the defendant, Henry E. Teck, himself, testifying as witness, has stated that this amber was worth P1,200 per kilo, we accept this estimated value set forth in the complaint. The decision of the court below contains the following order for judgment: "Wherefore, it is the judgment and order of the court that the defendants C. boon Liat, Henry E. Teck,

Ahamad Ong Chua, and Go Tong deliver to the plaintiffs, Emilio Punsalan, Bayrula, Daring Gumumtol, Mohamad, Insael, Dunkalan, Tahil, Dambul, Dagan, Sabay, Sahibul, Pingay, Mujahad, Amilol, Baraula, Saraban, Lim Chiat, and Cheong Tong twenty-twenty-firsts (20/21) of the amber in question, or, in default thereof, to pay them its value of twelve thousand pesos (P12,000), less one-twenty-first of said amount."cralaw virtua1aw libra ry Therefore, the judgment appealed from is affirmed, with the only modification that the value of the amber which is the subject-matter of this action shall be P60,000, without special finding as to the costs of this instance. So ordered. Araullo, C.J., Malcolm, Villamor, Ostrand, Johns, and Romualdez, JJ., concur.

Street, J., reserves his vote.

TINING RESUENA, ALEJANDRA GARAY, LORNA RESUENA, ELEUTERIO RESUENA, EUTIQUIA ROSARIO and UNISIMA RESUENA, Petitioners, versus HON. COURT OF APPEALS, 11th DIVISION and JUANITO BORROMEO, SR., Respondents. 2005 Mar 28 2nd Division G.R. No. 128338 CASE DOCTRINES Co-owner’s right to file an action for ejectment; occupation by tolerance

Respondent’s action for ejectment against petitioners is deemed to be instituted for the benefit of all co-owners of the property since petitioners were not able to prove that they are authorized to occupy the same. Petitioners’ lack of authority to occupy the properties, coupled with respondent’s right under Article 487,clearly settles respondent’s prerogative to eject petitioners from Lot No. 2587. Time and again, this Court has ruled that persons who occupy the land of another at the latter's tolerance or permission, without any contract between them, are necessarily bound by an implied promise that they will vacate the same upon demand, failing in which a summary action for ejectment is the proper remedy against them. FACTS: Petition for Review on certiorari under Rule 45.Juanito Borromeo, Sr. is the co-owner and overseer of certain parcels of land located in Pooc, Talisay, Cebu, designated as Lots Nos. 2587 and 2592 of the Talisay-Manglanilla Estate. He owned six-eighths (6/8) of Lot No. 2587 while the Sps. Bascon owned two-eights (2/8) thereof. On the other hand, Lot No. 2592 is owned in common by Borromeo and the heirs of one Nicolas Maneja. However, the proportion of their undivided shares was not determined a quo. Tining Resuena, Alejandra Garay, Lorna Resuena, Eleuterio Resuena, and Unisima Resuena resided in the upper portion of Lot No. 2587, allegedly under the acquiescence of the Spouses Bascon and their heir, Andres Bascon. On the other hand, petitioner Eutiquia Rosario occupied a portion of Lot No. 2592, allegedly with the permission of the heirs of Nicolas Maneja, one of the original co-owners of Lot No. 2587. Borromeo claimed that they have occupied portions of the subject property by virtue of his own liberality.

Borromeo developed portions of Lots Nos. 2587 and 2592 occupied by him into a resort known as the Borromeo Beach Resort. In his desire to expand and extend the facilities of the resort that he established on the subject properties, respondent demanded that petitioners vacate the property. Petitioners, however, refused to vacate their homes. On 16 February 1994, Borromeo filed a Complaint for ejectment with the MTC against the petitioners. MTC decision (summary proceeding): dismissed the complaint. Borromeo had no right to evict the petitioners because the area was owned in common and there was no partition yet. RTC decision: reversed the MTC decision. It held that Article 487 of the Civil Code, which allows any one of the co-owners to bring an action in ejectment, may successfully be invoked by the respondent because, in a sense, a co-owner is the owner and possessor of the whole, and that the suit for ejectment is deemed to be instituted for the benefit of all co-owners. CA decision: affirmed the RTC decision. ISSUE: WON Borromeo can lawfully evict the petitioners. RULING: Article 487 of the Civil Code, which provides simply that “*any one of the co-owners may bring an actionin ejectment,” is a categorical and an unqualified authority in favor of respondent to evict petitioners from the portions of Lot. No. 2587.This provision is a departure from Palarca v. Baguisi, which held that an action for ejectment must be brought by all the co-owners. Thus, a co-owner may bring an action to exercise and protect the rights of all. When the action is brought by one co-owner for the benefit of all, a favorable decision will benefit them; but an adverse decision cannot prejudice their rights. Respondent’s action for ejectment against petitioners is deemed to be instituted for the benefit of all co-owners of the property since petitioners were not able to prove that they are authorized to occupy the same. Petitioners’ lack of authority to occupy the properties, coupled with respondent’s right under Article 487, clearly settles respondent’s prerogative to eject petitioners from Lot No. 2587. Time and again, this Court has ruled that persons who occupy the land of another at the latter's tolerance or permission, without any contract between them, are necessarily bound by an implied promise that they will vacate the same upon demand, failing in which a summary action for ejectment is the proper remedy against them. HELD: Petition is DENIED.

LEONARDO ACABAL and RAMON NICOLAS, petitioners,

vs.

VILLANER ACABAL, EDUARDO ACABAL, SOLOMON ACABAL, GRACE

ACABAL, MELBA ACABAL, EVELYN ACABAL, ARMIN ACABAL, RAMIL

ACABAL, and BYRON ACABAL, respondents.

G.R. No. 148376 - March 31, 2005 – Carpio-Morales, J.

FACTS: “Alejandro Acabal and Felicidad Balasabas, owned a parcel of land situated in

Barrio Tanglad, Manjuyod, Negros Oriental, containing an area of 18.15 hectares more or

less, described in Tax Declaration No. 15856. By a Deed of Absolute Sale dated July 6, 1971,

his parents transferred for P2,000.00 ownership of the said land to [Villaner Acabal], who

was then married to Justiniana Lipajan.” On April 19, 1990, Villaner executed the deed in

question, by which the lot was transferred to his nephew and godson Leonardo Acabal, who

later sold it to Ramon Nicolas. On October 11, 1993 Villaner filed a case for annulment of

the sale to Leonardo and to Nicolas. Villaner claimed that he did not know the contents of the

deed he signed, which he claimed was a Deed of Sale (earlier in the proceedings he said it

was a Lease Contract). The RTC dismissed the complaint. Villaner appealed to the CA, who

reversed the RTC and held that the deed in question was simulated and fictitious. Leonardo

and Ramon thus appealed to the SC on certiorari.

ISSUE:

1) W/N the deed is valid

2) W/N the property in question is conjugal property

HELD/RATIO: 1) YES. The failure to deny the genuineness and due execution of an actionable document

does not preclude a party from arguing against it by evidence of fraud, mistake, compromise,

payment, statute of limitations, estoppel, and want of consideration. It is a basic rule in

evidence that the burden of proof lies on the party who makes the allegations. If he claims a

right granted by law, he must prove it by competent evidence, relying on the strength of his

own evidence and not upon the weakness of that of his opponent. Villaner failed to prove his

allegations for he failed to adduce evidence to support his claims of simulation and lack of

knowledge as to the nature of the deed. Leonardo‟s witness (the drafter of the actual deed) on

the other hand was able to prove that the deed was duly drafted, read and signed by Villaner.

“Even assuming that the disposition of the property by Villaner was contrary to law, he

would still have no remedy under the law as he and Leonardo were in pari delicto, hence, he

is not entitled to afirmative relief – one who seeks equity and justice must come to court with

clean hands. In pari delicto potior est conditio defendentis.”

2) YES. The issue arose when Villaner‟s co-heirs denied the validity of the transfer as to their

shares because they did not consent to such transfer. Art. 160 of the Civil Code gives rise to a

presumption that properties acquired during the marriage are conjugal. In this case it was

clear that Villaner was married when he acquired the land. A tax declaration or

“[r]egistration of the properties in the name of the husband does not destroy the conjugal

nature of the properties. What is material is the time when the land was acquired by Villaner,

and that was during the lawful existence of his marriage to Justiniana”. Upon his wife‟s

death, the conjugal partnership was dissolved and Villaner became entitled to a ½ undivided

share. The other share accrued to Justiniana‟s heirs: Villaner and their 8 children. They are

now the co-owners of the lot in question. “With respect to Justiniana’s one-half share in the

conjugal partnership which her heirs inherited, applying the provisions on the law of

succession, her eight children and Villaner each receives one-ninth (1/9) thereof. Having

inherited one-ninth (1/9) of his wife’s share in the conjugal partnership or one eighteenth

(1/18) of the entire conjugal partnership and is himself already the owner of one half (1/2) or

nine-eighteenths (9/18), Villaner’s total interest amounts to ten-eighteenths (10/18) or five-

ninths (5/9). While Villaner owns five-ninths (5/9) of the disputed property, he could not

claim title to any definite portion of the community property until its actual partition by

agreement or judicial decree. Prior to partition, all that he has is an ideal or abstract quota

or proportionate share in the property. Villaner, however, as a co-owner of the property has

the right to sell his undivided share thereof”, by virtue of NCC 493; but such sale will only

be valid as to the portion pertaining to Villaner. In effect, the buyer becomes a co-owner of

the property. “The proper action in cases like this is not for the nullification of the sale or

the recovery of possession of the thing owned in common from the third person who

substituted the co-owner or co-owners who alienated their shares, but the DIVISION of the

common property as if it continued to remain in the possession of the co-owners who

possessed and administered it.” The proper action is partition under Rule 69. The rule in

Cruz v. Leis, which held that “[w]here a parcel of land, forming part of the undistributed

properties of the dissolved conjugal partnership of gains, is sold by a widow to a purchaser

who merely relied on the face of the certificate of title thereto, issued solely in the name of the

widow, the purchaser acquires a valid title to the land even as against the heirs of the

deceased spouse” does not apply because the land subject of that case was unregistered. “The

issue of good faith or bad faith of a buyer is relevant only where the subject of the sale is a

registered land but not where the property is an unregistered land.”

DISPOSITION

WHEREFORE, the petition is GRANTED. The Court of Appeals February 15, 2001

Decision in CA-G.R. CV No. 56148 is REVERSED and SET ASIDE and another is rendered

declaring the sale in favor of petitioner Leonardo Acabal and the subsequent sale in favor of

petitioner Ramon Nicolas valid but only insofar as five-ninths (5/9) of the subject property is

concerned.

No pronouncement as to costs.

Lavadia v Cosme

May 9, 1941 ENGRACIA LAVADIA, et. al vs. ROSARIO MENDOZA AND OTHER COSME DIAZ, M p: DOCTRINE:

1. Even among co-owners of a thing, one of them may be the depository, and when he is, he is subject to the same obligations imposed by law on all depository with respect to the preservation of the thing with the care, diligence and interest of a good father. 2. For the administration and better enjoyment of thing owned in common, according to article 398 of the Civil Code, it is mandatory that there be an agreement of the majority of the participants (owners). FACTS:

1880: Certain jewelry were manufactured through the efforts of 6 pious ladies of Pagsanjan, Laguna, o They were sisters Pia and Paula Lavadia, sisters Martina and Matea Lavadia, and sisters Elizabeth

Lavadia and Engracia Lavadia.

The ladies contributed their own jewelry in the making of the crown and also contributed money in the cost of making them.

o The jewelries consist of a golden crown encrusted with diamonds and a diamond choker, bright, also a belt embedded with diamonds and diamonds, a gold necklace also completely embedded with glitter, gold bracelet encrusted with diamonds and diamonds, iron silver gilt where the jewels are placed above, and other various pieces of gold silver or gold for the decoration of the costumes of the image of Our Lady of Guadalupe

They sent said jewelries to adorn and decorate the Image of Our Lady of Guadalupe, patroness of the said township, retaining for themselves, the ownership of the same

When they were finished, its owners agreed that these jewels would be left with the taxpayer Pia Lavadia. She had the jewelry’s custody until her death in 1882.

Then, her sister Paula Lavadia succeeded her in the custody of the same.

At Paula Lavadia 's death, her husband Peter Rosales, succeeded her in the care, preservation and custody of such jewelry

When he died, their daughter Paz Rosales, in turn succeeded him in the jewelry’s custody, preservation and care.

At Paz Rosales' death, the crown and jewels passed to the custody of her husband Baldomero Cosme.

After Baldomero Cosme, said jewelry passed to Manuel Soriano.

He was succeeded in the custody, preservation and management of the jewelry by the defendant herein Rosario Cosme Mendoza.

Every year since 1980 to date, the jewels in question were used to decorate the image of Our Lady of Guadalupe in Pagsanjan, and none of those who have been keeping or guarding these jewels had intended exclusive possession as owner.

Feb. 9, 1938: Rosario, in her capacity as administrator of the deceased intestate Baldomero Cosme, notified all persons interested in such gems, that she would do a formal delivery of such jewelry to the Bishop of Lipa on February 12, 1938, informing them that they might witness the act of delivery (without the consent of the other co-owners)

Feb. 12, 1938: Rosario and her husband did make formal delivery of the jewels, giving the document for that purpose.

At this time, the original owners (6 pious ladies) have died, with the exception the plaintiff widow Dona Engracia y Lavadia Fernandez. The other plaintiffs are the heirs of Isabel, Matea and Martina Lavadia while the defendant Rosario Cosme de Mendoza and her co-defendants are legitimate heirs and descendants of Paula Lavadia.

Plaintiffs not in accord with such delivery designated Engracia Lavadia, one of the original owners, as recamadora plaintiff, to have in her care the crown and jewelry in question

June 21, 1938: The Bishop of Lipa, knowing the problem of possession, granted the administration giving custody of such crown jewels (magulo tong fact na to, di ko matranslate)

Plaintiffs then filed a case to claim the possession and custody of all the said jewelry. All these jewels are locked now and deposited in the Bank of the Philippine Islands, for it was there that Rosario Cosme had deposited the same.

Defendants Allegations:

o Rosario and his co-defendants do not intend to be sole owners of the said jewelry. o On the intestacy of Baldomero Cosme, they have told the Court that they never claimed such

dominion of jewelry or any part thereof.

However, Rosario and her predecessors have complied faithfully in performing their duties as repositories and therefore the court cannot withdraw the deposit of the jewelries

LOWER COURT: Against Rosario and co-defendants

o Plaintiffs are owners of said fourth-sixths of jewelry, and that the defendants are only owners of the remainder or only two sixths

o The one who had a perfect right to determine who was to take charge of the jewels custody, were the plaintiffs and they entrusted such care to Engracia Lavadia, one of the primitive owners.

o Rosario should deliver all of the jewels to the plaintiffs as she has been acting only as trustee and fiduciary

Defendants filed an appeal, believing the court erred: o (1) in finding that the appellant Rosario Cosme de Mendoza, and her predecessors are in the

possession of the said jewels, but acted only as trustees, and fiduciaries , o (2) stating that appellees are owners of four sixths of jewelry, which for this reason, have the

right to exercise the designation of the person to whom to entrust their care,

o (3) by failing to declare that appellant Rosario Cosme de Mendoza, being co-owner and fiduciary of such jewelry cannot be deprived of her administration and custody, except for reasons that she is incapacitated to do so, or performs acts contrary to the will of their primitive owners, or dispose of the above jewels at will,

o (4) to stop claiming that Pia Lavadia and their descendants, down to Rosario Cosme de Mendoza, who had had the custody and possession of the said jewels, have played their duties faithfully

ISSUES:

1) Whether Ramona was a depositary and therefore obligated to return the jewelries to the owners even if she is a co-owner? (YES)

2) Whether the plaintiffs constitute the majority of the co-owners and therefore can elect who has custody of the property owned in common? (YES)

3) Whether, assuming that Ramona is a depositary, the property cannot be withdrawn as she has complied faithfully in performing their duties as repository? (NO, it can be withdrawn)

RATIO:

1) The contract which existed between the first owners of the jewels at issue and the first person who had their custody, was a contract of deposit.

According to this contract as defined in Articles 1758 and following the Civil Code, Pia Lavadia first, and afterwards Paula Lavadia and then her descendants, one being Rosario, received and possessed, one after the other, the said jewels, only for purposes of custody or such that they must not use them for their own benefit.

If it was under a deposit agreement, it is clear that to those who received the jewelry has an obligation to return them to their owners as soon as claimed by the latter.

Article 1766 of the Civil Code: "The, depositary is obliged to keep the thing and restore it, when so requested, to the depositor, or his successors, or the person who has been designated in the contract. Their

responsibility for the care and the loss of the thing, is governed by the provisions of title I of this book. "

The restitution must be made with all the fruits and accessions of the thing deposited, if any, without it

being given to the depositary who may not withhold, as Sanchez says Roman, (IV Sanchez Roman, 885), even under the pretext of obtaining compensation for other credits or compensated for expenses incurred for preservation.

ROSARIO AND OTHERS: Contract is not that of a deposit because the jewels cannot be considered as

belonging to other persons with respect to Rosario as she is also a co-owner as descendant of one of its early owners.

SC: The first owners of the jewelry concerned who came to entrust the custody of the same to some of them, expressly reserved them to their property. Even among co-owners of a thing, one of them may be the depository, and thus it is subject to the same obligations imposed by law on all depository with respect to the conservation of the thing with the care, diligence and interest of a good father. "Joint owner. The fact that the depositary is a joint owner of the res does not alter the degree of diligence required of him." (C. J. 18, 570).

2) Appellees are owners of said fourth-sixths of jewelry, and appellants only own the remaining portion (2/6). Therefore, Engracia Lavadia must have the custody and administration of these jewels as she was entrusted by the appellees, constituting the majority of the primitive owners

As there is no evidence of the contribution of the six primitive owners in the making or acquisition of the

jewels often mentioned in the same proportion, the conclusion, as reasonable as it is - and this is supported by a presumption of law (Art. 393, Civil Code) - is that the cost is the same and as such the portions corresponding to the participants of the community shall be presumed of an equal share.

For the administration and better enjoyment of thing owned in common, according to article 398 of the Civil Code, it is mandatory that there be an agreement of the majority of the participants.

3) The deposit agreement is such that allows the depositor to withdraw from the depository, the thing deposited, any time he wanted, especially, when the latter, as in the case of Rosario Cosme Mendoza, has

executed an act against the order received in trying to entrust to another's custody and administration the thing deposited, on their own without the consent of depositors or their heirs. DISPOSITIVE: Lower Court Affirmed.

Melencio vs. Dy Tiao Lay

Facts

After the death of the owner of the land in question, his widow and three of his children executed a contract of lease of the land in favor of the predecessor in interest of Dy Tiao Lay. The term of the lease was for 20 years, extendible for a like period at the option of the lessee. It was further stipulated that at the termination of the original period of lease or its extension, the lessors might purchase all the buildings on the land at a price to be fixed by experts appointed by the parties, but if the lessors should fail to take a advantage of that privilege, the lease would continue for another and further 20 years.

The lease contract was not signed by two of the co-heirs. In 1920, the heirs made an extrajudicial partition of the inheritance, and among others things, the land here in question fell to the share of plaintiffs herein.

The coheirs that did not sign the lease contract brought this action to recover possession of the land leased to Dy Tiao Lay. They insisted that they had never any knowledge of the existence of such a contract of lease and that the contract was executed without their consent. Held

Considering that, although as a rule the contract of lease constitutes an act of management, as this court has several times held, cases may yet arise, either owing to the nature of the subject matter, or to the period of duration, which may render it imperative to record the contract in the registry of property, in pursuance of the Mortgage Law, where the contract of lease may give rise to a real right in favor of the lessee, and it would then

constitute such a sundering of the ownership as transcends mere management; in such cases it must of necessity be recognized that the part owners representing the greater portion of the property held in common have no power to lease said property for a longer period than six years without the consent of all the coowners, whose propriety rights, expressly recognized by the law, would by contracts of long duration be restricted or annulled; and as under article 1548 of the Civil Code such contracts cannot be entered into by the husband with respect to his wife's property, by the parent or guardian with respect to that of the child or ward, and by the manager in default of special power, since the contract of lease only produces personal obligations, and cannot without the consent of all persons interested or express authority from the owner, be extended to include stipulations which may alter its character, changing it into a contract of partial alienation of the property leased. Tolentino: The case was decided under the old civil code-if the lease of immovable property is not for more than 6 years, it constitutes an act of administration and the resolution of the majority of co-owners is sufficient.; while if it is for more than years it is an act of strict ownership and all the co-owners must consent. In the present code-the special power of attorney is required for leases of real property by an administrator in the following cases: 1)the lease cease to be an act of administration when it is to be recorded in the Registry of Property; 2) when the lease for any real property to another person is for more than one year.

Tuason v Tuason

Facts

Angela, Nieves and Antonio Tuason coowned a parcel of land. They entered into a memorandum of

agreement that no coowner shall sell, alienate or dispose of his ownership without fist giving preference to the

other coowners. Angela asked that the contract be rescinded and the property be partitioned stating that the

MoA is null and void.

Held

The MoA far from violating the legal provision that forbids a co-owner from being obliged to remain a

party to the community, precisely has for its purpose and object the dissolution of the co-ownership and of the

community by selling the parcel held in common and dividing the proceeds of the sale among the co-owners.

The obligation imposed in the MoA to preserve the co-ownership until all lots shall have been sold is a mere

incident to the main object of dissolving the co-ownership. By virtue of the MoA the parties practically

entered into a contract of partnership at best and most expedient means of eventually dissolving the property.

MARIANO V. CA | GOSIENGFIAO, 222 SCRA 736- REDEMPTION BY A CO-OWNER Redemption of the whole property by a co-owner within the redemption period does not terminate the co-ownership and does not vest in him sole ownership. FACTS: Francisco Gosiengfaio is the registered owner of a parcel of land in Tuguegarao. In his lifetime, he mortgaged the land to Rural Bank of Tuguegarao to secure payment of a loan. Francisco died in without paying the debt. His intestate heirs were: his wife Antonia and children Amparo, Carlos, Severo, Grace, Emma, Ester, Francisco, Jr., Norma, Lina, and Jacinto. The bank foreclosed on the mortgage but before the redemption period expired, Antonia, Emma, Lina, Norma, Lina, Carlos and Severo executed a deed of assignment of the right of redemption in favor of Amparo. Amparo later on sold the land to Spouses Mariano. Grace Gosengfiao, and the other heirs excuded in the deed of assignment filed a complaint for recovery and legal redemption with damages against spouses Mariano. RTC decided in favor of spouses Mariano. CA for Grace Gosiengfia, et. al.

ISSUE: Whether or not a co-owner who redeems the whole property with her own personal funds becomes the sole owner of said property and terminates the existing state of co-ownership? HELD: No. Admittedly, as the property in question was mortgaged by the decedent, a co-ownership existed among the heirs during the period given by law to redeem the foreclosed property. Redemption of the whole property by a co-owner does not vest in him sole ownership over said property but will inure to the benefit of all co-owners. In other words, it will not end to the existing state of co-ownership. Redemption is not a mode of terminating a co-ownership. Respondents have not lost their right to redeem, for in the absence of a written notification of the sale by the vendors, the 30-day period has not even begun to run.

FIRST DIVISION

[G.R. No. 109972. April 29, 1996]

ZOSIMA VERDAD, petitioner, vs. THE HON. COURT OF APPEALS, SOCORRO C. ROSALES, AURORA ROSALES, NAPOLEON ROSALES, ANTONIOROSALES, FLORENDA ROSALES, ELENA ROSALES AND VIRGINIA ROSALES, respondents.

SYLLABUS

1. CIVIL LAW; SUCCESSION; RIGHT TO REDEEM PROPERTY AS LEGAL HEIR OF HUSBAND, PART OF WHOSE ESTATE IS A SHARE IN HIS MOTHER’S INHERITANCE. - The thrust of the petition before us is the alleged incapacity of private respondent Socorro C. Rosales to redeem the property, she being merely the spouse of David Rosales, a son of Macaria, and not being a co-heir herself in the intestate estate of Macaria. Socorro’s right to the property is not because she rightfully can claim heirship in Macaria’s estate but that she is a legal heir of her husband, David Rosales, part of whose estate is a share in his mother’s inheritance. David Rosales, incontrovertibly, survived his mother’s death. When Macaria died her estate passed on to her surviving children, among them David Rosales, who thereupon became co-owners of the property. When David Rosales himself later died, his own estate, which included his undivided interest over the property inherited from Macaria, passed on to his widow Socorro and her co-heirs pursuant to the law on succession. Socorro and herein private respondents, along with the co-heirs of David Rosales, thereupon became co-owners of the property that originally descended from Macaria.

2. ID.; ID.; RIGHT OF REDEMPTION; WRITTEN NOTICE OF SALE, MANDATORY. - When their interest in the property was sold by the Burdeos heirs to petitioner, a right of redemption arose in favor of private respondents. This right of redemption was timely exercised by private respondents. Concededly, no written notice of the sale was given by the Burdeos heirs (vendors) to the co-owners required under Article 1623 of the Civil Code. The thirty-day period of redemption had yet to commence when private respondent Rosales sought to exercise the right of redemption on 31 March 1987, a day after she discovered the sale from the Office of the City Treasurer of Butuan City, or when the case was initiated, on 16 October 1987, before the trial court. The written notice of sale is mandatory. This Court has long established the rule that notwithstanding actual knowledge of a co-owner, the latter is still entitled to a written notice from the selling co-owner in order to remove all uncertainties about the sale, its terms and conditions, as well as its efficacy and status.

APPEARANCES OF COUNSEL

Jessie C. Ligan for petitioner. Federico A. Calo for private respondents.

D E C I S I O N

VITUG, J.:

The petitioner, Zosima Verdad, is the purchaser of a 248-square meter residential lot (identified to be Lot No. 529, Ts-65 of the Butuan Cadastre, located along Magallanes Street, now Marcos M. Calo St., Butuan City). Private respondent, Socorro Cordero Vda. de Rosales, seeks to exercise a right of legal redemption over the subject property and traces her title to the late Macaria Atega, her mother-in-law, who died intestate on 08 March 1956.

During her lifetime, Macaria contracted two marriages: the first with Angel Burdeos and the second, following the latter’s death, with Canuto Rosales. At the time of her own death, Macaria was survived by her son Ramon A. Burdeos and her grandchild (by her daughter Felicidad A. Burdeos) Estela Lozada of the first marriage and her children of the second marriage, namely, David Rosales, Justo Rosales, Romulo Rosales, and Aurora Rosales.

Socorro Rosales is the widow of David Rosales who himself, some time after Macaria’s death, died intestate without an issue.

In an instrument, dated 14 June 1982, the heirs of Ramon Burdeos, namely, his widow Manuela Legaspi Burdeos and children Felicidad and Ramon, Jr., sold to petitioner Zosima Verdad (their interest on) the disputed lot supposedly for the price of P55,460.00. In a duly notarized deed of sale, dated 14 November 1982, it would appear, however, that the lot was sold for only P23,000.00. Petitioner explained that the second deed was intended merely to save on the tax on capital gains.

Socorro discovered the sale on 30 March 1987 while she was at the City Treasurer’s Office. On 31 March 1987, she sought the intervention of the Lupong Tagapayapa of Barangay 9, Princess Urduja, for the redemption of the property. She tendered the sum of P23,000.00 to Zosima. The latter refused to accept the amount for being much less than the lot’s current value of P80,000.00. No settlement having been reached before the Lupong Tagapayapa, private respondents, on 16 October 1987, initiated against petitioner an action for “Legal Redemption with Preliminary Injunction” before the Regional Trial Court of Butuan City.

On 29 June 1990, following the reception of evidence, the trial court handed down its decision holding, in fine, that private respondents’ right to redeem the property had already lapsed.

An appeal to the Court of Appeals was interposed by private respondents. the appellate court, in its decision of 22 April 1993, reversed the court a quo; thus:

“WHEREFORE, premises considered, the judgment appealed from is hereby REVERSED, and a new one is

accordingly entered declaring plaintiff-appellant, Socorro C. Rosales, entitled to redeem the inheritance rights

(Art. 1088, NCC) or pro indiviso share (Art. 1620, NCC) of the Heirs of Ramon Burdeos, Sr. in Lot 529, Ts-65

of the Butuan Cadastre, within the remaining ELEVEN (11) DAYS from finality hereon, unless written notice

of the sale and its terms are received in the interim, under the same terms and conditions appearing under

Exhibit „J‟ and after returning the purchase price of P23,000.00 within the foregoing period. No cost.”[1]

In her recourse to this Court, petitioner assigned the following “errors:” That –

”The Honorable Court of Appeals erred in declaring Socorro C. Rosales is entitled to redeem the inheritance

rights (Article 1088, NCC) or pro-indiviso share (Article 1620, NCC) of the heirs of Ramon Burdeos, Sr. in Lot

529, Ts-65 of the Butuan Cadastre, for being contrary to law and evidence.

“The Honorable Court of Appeals erred in ignoring the peculiar circumstance, in that, the respondents‟ actual

knowledge, as a factor in the delay constitutes laches.

“The Honorable Court of Appeals erred in concluding that Socorro C. Rosales, in effect, timely exercised the

right of legal redemption when referral to Barangay by respondent signifies bonafide intention to redeem and;

that, redemption is properly made even if there is no offer of redemption in legal tender.

“The Honorable Court of Appeals erred in ruling that the running of the statutory redemption period is stayed

upon commencement of Barangay proceedings.”[2]

Still, the thrust of the petition before us is the alleged incapacity of private respondent Socorro C. Rosales to redeem the property, she being merely the spouse of David Rosales, a son of Macaria, and not being a co-heir herself in the intestate estate of Macaria.

We rule that Socorro can. It is true that Socorro, a daughter-in-law (or, for that matter, a mere relative by affinity), is not an intestate heir of her parents-in-law;

[3] however, Socorro’ s right to the

property is not because she rightfully can claim heirship in Macaria’s estate but that she is a legal heir of her husband, David Rosales, part of whose estate is a share in his mother’s inheritance.

David Rosales, incontrovertibly, survived his mother’s death. When Macaria died on 08 March 1956 her estate passed on to her surviving children, among them David Rosales, who thereupon became co-owners of the property. When David Rosales himself later died, his own estate, which included his undivided interest over the property inherited from Macaria, passed on to his widow Socorro and her co-heirs pursuant to the law on succession.

“ART. 995. In the absence of legitimate descendants and ascendants, and illegitimate children and their

descendants, whether legitimate or illegitimate, the surviving spouse shall inherit the entire estate, without

prejudice to the rights of brothers and sisters, nephews and nieces, should there be any, under Article 1001.

“xxx xxx xxx

“ART. 1001. Should brothers and sisters or their children survive with the widow or widower, the latter shall be

entitled to one-half of the inheritance and the brothers and sisters or their children to the other half.”[4]

Socorro and herein private respondents, along with the co-heirs of David Rosales, thereupon became co-owners of the property that originally descended from Macaria.

When their interest in the property was sold by the Burdeos heirs to petitioner, a right of redemption arose in favor of private respondents; thus:

“ART. 1619. Legal redemption is the right to be subrogated, upon the same terms and conditions stipulated in

the contract, in the place of one who acquires a thing by purchase or dation in payment, or by any other

transaction whereby ownership is transmitted by onerous title.”

“ART. 1620. A co-owner of a thing may exercise the right of redemption in case the shares of all the other co-

owners or of any of them, are sold to a third person. If the price of the alienation is grossly excessive, the

redemptioner shall pay only a reasonable one.”

We hold that the right of redemption was timely exercised by private respondents. Concededly, no written notice of the sale was given by the Burdeos heirs (vendors) to the co-owners

[5]required

under Article 1623 of the Civil Code –

”ART. 1623. The right of legal pre-emption or redemption shall not be exercised except within thirty days from

the notice in writing by the prospective vendor, or by the vendor, as the case may be. The deed of sale shall not

be recorded in the Registry of Property, unless accompanied by an affidavit of the vendor that he has given

written notice thereof to all possible redemptioners.”

Hence, the thirty-day period of redemption had yet to commence when private respondent Rosales sought to exercise the right of redemption on 31 March 1987, a day after she discovered the sale from the Office of the City Treasurer of Butuan City, or when the case was initiated, on 16 October 1987, before the trial court.

The written notice of sale is mandatory. This Court has long established the rule that notwithstanding actual knowledge of a co-owner, the latter is still entitled to a written notice from the selling co-owner in order to remove all uncertainties about the sale, its terms and conditions, as well as its efficacy and status.

[6]

Even in Alonzo vs. Intermediate Appellate Court,[7]

relied upon by petitioner in contending that actual knowledge should be an equivalent to a written notice of sale, the Court made it clear that it was not reversing the prevailing jurisprudence; said the Court:

“We realize that in arriving at our conclusion today, we are deviating from the strict letter of the law, which the

respondent court understandably applied pursuant to existing jurisprudence. The said court acted properly as it

had no competence to reverse the doctrines laid down by this Court in the above-cited cases. In fact, and this

should be clearly stressed, we ourselves are not abandoning the De Conejero and Buttle doctrines. What we are

doing simply is adopting an exception to the general rule, in view of the peculiar circumstances of this case.”[8]

In Alonzo, the right of legal redemption was invoked several years, notjust days or months, after the consummation of the contracts of sale. The complaint for legal redemption itself was there filed more than thirteen years after the sales were concluded.

Relative to the question posed by petitioner on private respondents’ tender of payment, it is enough that we quote, with approval, the appellate court; viz:

“In contrast, records clearly show that an amount was offered, as required in Sempio vs. Del Rosario, 44 Phil. 1

and Daza vs. Tomacruz, 58 Phil. 414, by the redemptioner-appellant during the barangay conciliation

proceedings (Answer, par. 8) but was flatly rejected by the appellee, not on the ground that it was not the

purchase price (though it appeared on the face of the deed of sale, Exh. „J-1‟), nor that it was offered as partial

payment thereof, but rather that it was „unconscionable‟ based upon its „present value.‟ (Answer, par. 8).”[9]

All given, we find no error in the appellate court’s finding that private respondents are entitled to the redemption of the subject property.

WHEREFORE, the petition is DENIED and the assailed decision of the Court of Appeals is AFFIRMED. Costs against petitioner.

SO ORDERED.

Padilla (Chairman), Bellosillo, Kapunan, and Hermosisima, Jr., JJ., concur.

G.R. NO. L-22621, RAMIREZ V. RAMIREZ ET AL., 21 SCRA 384

Republic of the Philippines

SUPREME COURT

Manila

EN BANC

DECISION

September 29, 1967

G.R. No. L-22621

JOSE MARIA RAMIREZ, plaintiff-appellee,

vs.

JOSE EUGENIO RAMIREZ, RITA D. RAMIREZ, BELEN T. RAMIREZ, DAVID MARGOLIES,

MANUEL UY and SONS, INC., BANK OF THE PHILIPPINE ISLANDS, in its capacity as judicial

administrator of the Testate Estate of the late Jose Vivencio Ramirez, defendants-appellants, ANGELA

M. BUTTE, defendant-appellee.

Sycip, Salazar, Luna and Associates for plaintiff-appellee. Ramirez and Ortigas for defendants-appellants.

, J.: Appeal by the defendants from a decision of the Court of First Instance of Manila.

Plaintiff, Jose Maria Ramirez, brought this action1 against defendants Jose Eugenio Ramirez, Rita D. Ramirez,

Belen T. Ramirez, David Margolies, Manuel Uy & Sons, Inc., the Estate of the late Jose Vivencio Ramirez

represented by its judicial administrator, the Bank of the Philippine Islands, and Angela M. Butte - hereinafter

referred to collectively as defendants - for the partition of a parcel of land situated at the Northwestern corner of

Escolta street and Plaza Sta. Cruz, Manila - otherwise known as Lot 1 of Block 2120 of the Cadastral Survey of

Manila and more particularly described in Transfer Certificate of Title No. 53946 of the Register of Deeds for

said City - and belonging pro indiviso to both parties, one-sixth (1/6) to the plaintiff and five-sixths (5/6) to the

defendants.

Manuel Uy & Sons expressed its conformity to the partition, "if the same can be done without great prejudice to

the interests of the parties." Defendant Butte agreed to the partition prayed for. The other defendants objected to

the physical partition of the property in question, upon the theory that said partition is "materially and legally"

impossible and "would work great harm and prejudice to the co-owners." By agreement of the parties the lower

Court referred the matter to a Commission composed of:

(1) Delfin Gawaran, Deputy Clerk of said court, as Chairman,

(2) Artemio U. Valencia, President of the Manila Board of Realtors, as commissioner for plaintiff, and

(3) Ramon F. Cuervo, President of the Perpetual Investment Corporation, Inc., as commissioner for

defendants,

to determine whether the property is susceptible of partition, and submit a plan therefor, if feasible, as well as to

report thereon. Subsequently, the commissioners submitted their individual reports with their respective plans

for the segregation of plaintiff's share.

After due hearing, the Court rendered a decision declaring that plaintiff is entitled to the segregation of his

share, and directing that the property be partitioned in accordance with the plan submitted by commissioner

Valencia, and that the expenses incident thereto be paid by both parties proportionately. Hence, this appeal by,

the defendants, except Mrs. Butte. Appellants maintain that the lower court has erred: 1) in holding that said

property is legally susceptible of physical division; 2) in accepting the recommendation of commissioner

Valencia, instead of that of commissioner Cuervo, or a proposal made by the very plaintiff; and 3) in not

ordering that the incidental expenses be borne exclusively by him.

We find no merit in the appeal.

With respect to the first alleged error, it is urged that a physical division of the property will cause "inestimable

damage" to the interest of the co-owners. No evidence, however, has been introduced, or sought to be

introduced, in support of this allegation. Moreover, the same is predicated upon the assumption that a real estate

suitable for commercial purposes - such as the one herein sought to be partitioned - is likely to suffer a

proportionately great diminution in value when its area becomes too small. But, then, if plaintiff's share of

260.26 square meters were segregated from the property in question, there would still remain a lot of 1,301.34

square meters for appellants herein and Mrs. Butte. A real estate of this size, in the very heart of Manila, is not,

however, inconsequential, in comparison to that of the present property of the community. In other words, we do

not believe that its value would be impaired, on account of the segregation of plaintiff's share, to such an extent

as to warrant the conclusion that the property is indivisible.

Appellants argue that, instead of making the aforementioned segregation, plaintiff's share should be sold to

them. In support of this pretense, they cite the provision of Article 495 of our Civil Code, to the effect that:

. . . Notwithstanding the provisions of the preceding article, the co-owners cannot demand a physical division of

the thing owned in common, when to do so would render it unserviceable for the use for which it is intended.

But the co-ownership may be terminated in accordance with article 498.

They apparently assume, once again, that the alleged "inestimable damage" to be suffered by the property, if

plaintiff's share were segregated, is equivalent to rendering it "unserviceable for the use for which it is

intended." Independently of the fact that the minor premise of this syllogism - the alleged "inestimable damage"

- has not been established, the conclusion drawn by appellants does not follow necessarily. Indeed, the record

shows that there are two (2) buildings on the land in question, namely: 1) a two-storey commercial building -

known as "Sta. Cruz Building" - abutting on the one (1) side, 2 on the Escolta, and, on the other 3 on Plaza

Santa Cruz; and 2) a small two-storey residential building, on the Northwestern end of the lot, and behind the

first building, adjoining the Estero de la Reina, which constitutes the Southwestern boundary of the property.

There is nothing to show that, after segregating plaintiff's share, the buildings left on the remaining 1,301.34

square meters, representing defendants' share, would be unserviceable, either for commercial or for residential

purposes. On the contrary, it seems obvious that plaintiff would not insist upon the partition prayed for, if his

share 4 were unserviceable for either - particularly the commercial - purpose. In fact, every one of the

aforementioned commissioners, including the one representing defendants herein, recommended the segregation

of plaintiff's share. The commissioners merely failed to agree on the precise configuration thereof.

This brings us to the second issue raised by appellants: whether the lower court should have adopted the plan

submitted by their own commissioner, or "in not taking into consideration," at least, a proposal made by plaintiff

herein. In this connection, it appears that said commissioner 5 recommended that plaintiff's share be given a

frontage of 6.14 lineal meters at Plaza Sta. Cruz, whereas the commissioner for the Court 6 favored a frontage of

12.66 square meters at said Plaza; that defendants' main objection to the plan recommended by commissioner

Valencia 7 and adopted by the lower court, is that it left behind the portion awarded to plaintiff, a lot of 169

square meters, which would have to be divided among the defendants, should they later wish to have their

individual shares segregated; and that, in order to offset this objection, plaintiff expressed - in one of the pre-

trials held in the lower court and in order to "facilitate early termination" of the case - the willingness "to buy

from the other co-owners the remaining portion of the land behind his lot at P1,000 per square meter."

The record does not show that this offer of the plaintiff had not been "taken into consideration" by the lower

court. Moreover, defendants had not accepted it. And neither do they accept it now, for they would want the

plaintiff to pay a price higher than that offered by him. Upon the other hand, the disadvantage resulting to the

defendants from the existence of said lot of 169 square meters, behind that awarded to the plaintiff, is offset by

the fact that the remaining portion of the land in question - representing defendants' collective share - has, in

addition to a frontage of around 40 meters on Plaza Santa Cruz, a frontage of 24.13 meters on Escolta Street,

which apart from being, admittedly, the most valuable one, is totally denied to the plaintiff. Then, again the

Cuervo plan giving plaintiff a 6.14 meters frontage of Plaza Sta. Cruz, goes all the way down to the Western end

of the property, the Estero de la Reina, and would require a partition of the residential building, on that part of

the property in question, which the very plaintiff says is indivisible, because it would render said building

"unserviceable for the purpose for which it is intended." 8

As regards the last alleged error, it is obvious that the segregation of plaintiff's share inures to the benefit not

only of the plaintiff, but, also, of the defendants, and that both should, consequently, defray the incidental

expenses.

WHEREFORE, the decision appealed from is hereby the costs of this instance against herein defendants-

appellants. It is so ordered.

Reyes, J.B.L., Dizon, Makalintal, Zaldivar, Sanchez, Castro, Angeles and Fernando, JJ., concur.

Bengzon, J.P., J., is on leave.

AGUILAR V. CA - CO-OWNERSHIP Any of the Co-owners may demand the sale of the house and lot at any time and the other cannot object to such demand; thereafter the proceeds of the sale shall be divided equally according to their respective interests.

FACTS: Petitioner Vergilio and respondent Senen bought a house and lot in Paraňaque where their father could spend and enjoy his remaining years in a peaceful neighborhood. They initially agreed that Vergilio will get 2/3 and Senen will get 1/3; but later they agreed on equal shares. Senen was left in the said lot to take care of their father since Vergilio’s family was in Cebu. After their father’s death petitioner demanded from private respondent that the latter vacate the house and that the property be sold and proceeds thereof divided among them but the latter refused. Petitioner then filed to compel the sale of the property. The chunk of the issue tackled by the courts was regarding the pre-trial. Respondent filed a motion to cancel Pre-trial since the counsel had to accompany his wife in Dumaguete City where she would be a principal sponsor in a wedding. CFI denied the motion; and the pre-trial proceeded on the scheduled date. The respondents did not appear thus they were declared in default. The trial went on ex parte without the respondent

and held that the property should be sold to a third party and that the proceeds be distributed to the parties; in addition respondent was made to pay rent from the time the action was filed. Respondents appealed this and the decision was reversed by the CA saying that the TC erred in declaring respondents in default; the case was then remanded to the trial court. Hence this appeal.

ISSUE: A) W/N CA erred (1) in holding that the motion of respondent through counsel to cancel the pre-trial was dilatory in character and (2) in remanding the case to the trial court for pre-trial and trial? ISSUE RELEVANT TO PROPERTY: B) W/N trial court was correct with regards to the sale and rent?

RULING: A) YES, CA erred in granting the respondents motion and remanding the case. The law is clear that the appearance of parties at the pretrial is mandatory. A party who fails to appear at a pre-trial conference may be non-suited or considered as in default. It is the discretion of the court to grant the motion if it sees that the reason for the cancelation of the same would be reasonable. SC found that the reason for the cancelation of the pre-trial was insufficient and that the trial court was not in grave abuse of discretion when they denied it. B) YES, with a few modification. Petitioner and respondents are co-owners of subject house and lot in equal shares; either one of them may demand the sale of the house and lot at any time and the other cannot object to such demand; thereafter the proceeds of the sale shall be divided equally according to their respective interests. BASIS: Article 494 of the Civil Code provides that no co-owner shall be obliged to remain in the co-ownership, and that each co-owner may demand at any time partition of the thing owned in common insofar as his share is concerned. Corollary to this rule, Art. 498 of the Code states that whenever the thing is essentially indivisible and the co-owners cannot agree that it be allotted to one of them who shall indemnify the others, it shall be sold and its proceeds accordingly distributed. SC held that ½ of the proceeds should go to the petitioner and the remainder to the respondent (1,200 each.) Also rent was awarded 1,200 pesos per month with legal interest from the time the trial court ordered the respondent to vacate, for the use and enjoyment of the other half of the property. BASIS: When petitioner filed an action to compel the sale of the property and the trial court granted the petition and ordered the ejectment of respondent, the co-ownership was deemed terminated and the right to enjoy the possession jointly also ceased.

PERPETUA VDA. DE APE v. CA

April 15, 2005, 456 SCRA 193

Elements of a Contract of Sale – Consent Vitiated

Cleopas Ape died in 1950 and left a parcel of land (Lot 2319) to his 11 children. The children never

formally divided the property amongst themselves except through hantal-hantal whereby each just

occupied a certain portion and developed each.

On the other hand, the spouses Lumayno were interested in the land so they started buying the

portion of land that each of the heirs occupied. On 11 Apr 1973, one of the children, Fortunato,

entered into a contract of sale with Lumayno. In exchange of his lot, Lumayno agreed to pay

P5,000.00. She paid in advance P30.00. Fortunato was given a receipt prepared by Lumayno’s son in

law (Andres Flores). Flores also acted as witness. Lumayno also executed sales transactions with

Fortunato’s siblings separately.

In 1973, Lumayno compelled Fortunato to make the the delivery to her of the registrable deed of sale

over Fortunato’s portion of the Lot No. 2319. Fortunato assailed the validity of the contract of sale. He

also invoked his right to redeem (as a co-owner) the portions of land sold by his siblings to Lumayno.

Fortunato died during the pendency of the case.

ISSUE: Whether or not there was a valid contract of sale?

HELD: No. Fortunato was a “no read no write” person. It was incumbent for the the other party to

prove that details of the contract was fully explained to Fortunato before Fortunato signed the receipt.

A contract of sale is a consensual contract, thus, it is perfected by mere consent of the parties. It is

born from the moment there is a meeting of minds upon the thing which is the object of the sale and

upon the price. Upon its perfection, the parties may reciprocally demand performance, that is, the

vendee may compel the transfer of the ownership and to deliver the object of the sale while the

vendor may demand the vendee to pay the thing sold. For there to be a perfected contract of sale,

however, the following elements must be present: consent, object, and price in money or its

equivalent.

For consent to be valid, it must meet the following requisites: (a) it should be intelligent, or with an

exact notion of the matter to which it refers; (b) it should be free and (c) it should be

spontaneous. Intelligence in consent is vitiated by error; freedom by violence, intimidation or undue

influence; spontaneity by fraud.

Lumayno claimed that she explained fully the receipt to Fortunato, but Flores’ testimony belies it.

Flores said there was another witness but the other was a maid who was also lacked education.

Further, Flores himself was not aware that the receipt was “to transfer the ownership of Fortunato’s

land to her mom-in-law”. It only occurred to him to explain the details of the receipt but he never did.

G.R. No. 113539 March 12, 1998

CELSO R. HALILI and ARTHUR R. HALILI, petitioners, vs.

COURT OF APPEALS, HELEN MEYERS GUZMAN, DAVID REY GUZMAN and EMILIANO CATANIAG, respondents.

I. FACTS

Simeon de Guzman, an American citizen, died sometime in 1968, leaving real properties in the Philippines. His forced heirs were his widow, defendant appellee Helen Meyers Guzman, and his son, defendant appellee David Rey Guzman, both of whom are also American citizens. On August 9, 1989, Helen executed a deed of quitclaim, assigning, transferring and conveying to David Rey all her rights, titles and interests in and over six parcels of land which the two of them inherited from Simeon. Among the said parcels of land is that now in litigation, . . . situated in Bagbaguin, Sta. Maria, Bulacan, containing an area of 6,695 square meters. On February 5, 1991, David Rey Guzman sold said parcel of land to defendant-appellee Emiliano Cataniag.

II. ISSUES a. Whether or not the subjected land was rural b. Whether or not the sale to Cataniag was valid

III. HELD The petition has no merit.

a. Subject Land is Urban The conclusion of the trial court -- that the subject property is urban land -- is based on clear and convincing evidence. Finding the subject land was urban, the petitioners have no ground to invoke the

right of redemption, which presupposes that the land sought to be redeemed is rural. The provision is clearly worded and admits of no ambiguity in construction:

“ART. 1621. The owners of adjoining lands shall also have the right of redemption when a piece of rural land, the area of which does not exceed one hectare, is alienated, unless the grantee does not own any rural land.”

b. Sale to Cataniag valid Helen Guzman’s quitclaim, which she assigned, transferred and conveyed to David Rey all her

rights, titles and interests over the property, collided with the Constitution which states that only the qualified, can acquire lands of the public domain with the exception of hereditary succession. In the 1935 Constitution, aliens cannot acquire public as well as private lands. In fine, non-Filipinos cannot acquire or hold title to private lands or to lands of the public domain, except only by way of legal succession.

Jurisprudence is consistent that “if land is invalidly transferred to an alien who subsequently becomes a citizen or transfers it to a citizen, the flaw in the original transaction is considered cured and the title of the transferee is rendered valid.” Since the disputed land is now owned by Cataniag, a Filipino citizen, the prior invalid transfer can no longer be assailed.

Francisco v Boiser

Facts

Francisco and three of her sisters are co-owners of land on which a commercial building stands. They sold

1/5 of their undivided share to their mother, thus making their mother a co-owner. In 1986, without the

knowledge of Francisco & co., the mother sold her share to Boiser. On 5 Aug 1992, Francisco received

summons, with a copy of the complaint filed by Boiser, demanding her share in the rentals collected by

Francisco from the building’s tenants. Francisco then informed her that she was exercising her right of

redemption as co-owner. The lower courts ruled that the 30-day period for redemption has lapsed because as

early as 30 May 1992, Francisco knew about the sale because, on that date, Boiser wrote Francisco a letter

informing the latter about the sale, demanding the rentals, with a copy of the Deed of Sale between Francisco’s

mother and Boiser.

Held

The letter of 30 May 1992 cannot be considered sufficient as compliance with the notice requirement of

Art. 1623. Art. 1623 requires that the written notification should come from the vendor or prospective vendor,

not from any other person. The vendor of an undivided interest is in the best position to know who his co-

owners are, who must be notified of the sale. It is the notification from the seller, which can remove all doubts

as to the fact of the sale, its perfection, and its validity, for in a contract of sale, the seller is in the best position

to confirm whether consent to the essential obligation of selling the property and transferring ownership

thereof to the vendee has been given. Thus, sufficient compliance with Art. 1623 means that Francisco’s

mother is the one informing her of the sale, not Boiser. [NOTE: As the subject sale has already been established before

the courts, it is no longer required that notice be given by the mother before Francisco can exercise her right. The receipt by

Francisco of summons on 5 Aug 1992 constitutes actual knowledge on the basis of which Francisco may now exercise her right of

redemption within 30 days from finality of this decision.]

G.R. No. L-44426 February 25, 1982 SULPICIO CARVAJAL, petitioner, vs. THE HONORABLE COURT OF APPEALS ** and EUTIQUIANO CAMARILLO and LIBERATA CACABELOS,respondents. Facts:

The subject lot was originally owned by Hermogenes Espique and his wife and after their death, the lot was succeeded by their children, Maria, Evaristo, Faustino, Estefanio and Tropinio. Petitioner then averred that he purchased the 2/5 of the lot from Estefanio and respondents purchased 1/5 of the lot from Evaristo. The part of the land in controversy was the 1/5 portion. This prompted the private respondents to file a case of ejectment and recovery of possession, where in fact there has been no partition yet on the subject lot. Both the lower court and the appellate court ruled in favor of the respondents. Hence, this petition. Issue: Whether the co-owners may sell a specific part of the co-owned property without partition. Held: The Supreme Court ruled in negative and reversed the decision of the lower court. The fact that the sale executed by Evaristo G. Espique in favor of respondents and the sale executed by Estefanio Espique in favor of petitioner were made before the partition of the property among the co-heirs does not annul or invalidate the deeds of sale and both sales are valid. However, the interests thereby acquired by petitioner and respondents are limited only to the parts that may be ultimately assigned to Estefanio and Evaristo, respectively, upon the partition of the estate

7 subject to

provisions on subrogation of the other co-heirs to the rights of the stranger-purchaser provided in Article 1088 of the Civil Code. Unless a project of partition is effected, each heir cannot claim ownership over a definite portion of the inheritance. Without partition, either by agreement between the parties of by judicial proceeding, a co-heir cannot dispose of a specific portion of the estate. For where there are two or more heirs, the whole estate such heirs.

1 Upon the death of a person, each of his heirs becomes the undivided

owner of the whole estate left wtih respect to the part of portion which might be adjudicated to him, a community of ownership being thus formed among the co-owners of the estate or co-heirs while it remains undivided

Pamplona v Moreto

Facts

6 years after the death of his wife and without the consent of the heirs of the wife plus even before the

liquidation of the conjugal partnership, Flaviano Moreto sold 781 sq. m. of conjugal lot to the Pamplona

spouses. The conjugal property consists of 3 adjacent lots totaling 2,346 sq. m. After Flaviano pointed ot the

sold lot, the Pamplonas built their house and piggery on it. After the death of Flaviano, the heirs, insisting on

their right to the property, demanded that the Pamplonas vacate the land. TC and CA favored the heirs.

Held

Flaviano had the perfect right to sell the lot. After the wife’s death, he became entitled to ½ of the entire

property, with only ½ belonging to the heirs. They hold the property as co-owners. Since his share amounts

to 1,173 sq. m., the area he sold (781 sq. m.) is within the limits o his share. There was partial partition of the

property when Flaviano pointed to the lot he sold to the Pamplonas.

Castro v Atienza

Facts

On Jan 24, 1956, brothers Tomas and Arsenio de Castro, Sr. leased to Gregorio Atienza a 26-hectare

fishpond co-owned by them in Polo, Bulacan for 5 years. In Nov 1956, Atienza and Arsenio, Sr. agreed to set

aside and annul the contract of lease through a written agreement signed by both of them. The reason was

Arsenio, Sr. wanted to lease the fishpond to another person. However, the widow of Tomas, Feliza Cruz Vda.

de Castro, refused to sign such agreement. There was an agreement that the rent of P2,500 paid by Atienza will

be returned to him on Dec 30, 1956, but due to the lack of signature, he was still not paid. He instituted an

action in the CFI. The latter ordered the payment of P2,500. CA affirmed.

Held

The consent of the widow of Tomas is not essential to the validity of the agreement of the cancellation of

the lease between Arsenio and Atienza (despite the absence of express provision that the widow’s signature is a

condition for validity). Art 493 of the NCC allows the alienation of the co-owner of his part in the co-

ownership. The effect of such alienation or mortgage shall be limited to the portion which may be allotted to

him in the division upon the termination of the co-ownership

When Arsenio and Tomas entered into a contract of lease with Atienza, each of them leased their

respective undivided ½ interest owned in common. In case only the other leased his ½ share to Atienza, there

would result a partnership between the lessee Atienza and the owner of the other undivided ½ share who did

not lease. In short, a co-owner can enter into a contract of lease insofar as to his interest. Therefore, he can

also cancel such lease without the consent from the other co-owner. It is clear that Felisa’s signature is not

needed to cancel the lease of Arsenio’s own ½ undivided share, pursuant to his right granted by Art 493.

Estoque v Pajimula Facts

Lot No. 802 of the Cadastral survey of Rosario was originally owned by the late spouses, Rosendo Perez and Fortunata Bernal, who were survived by her children, namely, Crispina Perez, Lorenzo Perez and Ricardo Perez.

Crispina Perez Vda. de Aquitania sold her right and participation in Lot No. 802 consisting of 1/3

portion with an area of 640 square meters to Leonora Estoque. The next day, Crispina’s co-heirs executed a

deed of extrajudicial settlement wherein they assigned all their right, interest and participation in Lot No. 802

to Crispina Perez.

Crispina Perez and her children sold to Elena Pajimula, the remaining 2/3 western portion of Lot No. 802

with an area of 958 square meters.

Held Estoque became the actual owner of the southeastern third of lot 802 on October 29, 1951. Wherefore, she

never acquired an undivided interest in lot 802. And when eight years later Crispina Perez sold to the appellees Pajimula the western two-thirds of the same lot, appellant did not acquire a right to redeem the property thus sold, since their respective portions were distinct and separate and they never became co-owners.

Diversified Credit v. Rosado (supra)

Facts

A lot belonged to 13 co-owners including the Rosado. She signed a deed of sale together with the co-

owners in favor of Diversified Credit. However Rosado’s husband had built a house on the property without

the property having been previously partitioned. Diversified then demanded they vacate or remove the house

but the sps refused alleging that it was a conjugal house (A.158CC) and that the building of the house made

the 1/13th share of the wife community property as such making her signature in the deed of sale void insofar

as the 1/13th is concerned.

Held

It is the basic principle in the law of co-ownership that no individual co-owner can claim title to any

definite portion of the land or thing owned in common until the partition thereof. Prior to that time, all that

the co-owner has is an ideal, or abstract, quota or proportionate share in the entire thing owned in common by

all the co-owners. It cannot be validly claimed that the house constructed was built on land belonging to her,

and 158 cannot apply. Necessarily, the claim of conversion of the wife’s share from paraphernal to conjugal

must be rejected.

PNB v CA

Facts

After the death of her husband, Rosa mortgaged the entire conjugal property to PNB. The title to this

property was still under proceedings but it was subsequently awarded to the spouses a year after the mortgage.

The mortgage to PNB was, however, not annotated. Meanwhile, she defaulted with her obligation to Manila

Trading Co. (MTC) and her share (meaning ½ of the property) was sold at public auction. Santiago Sambrano,

and subsequently, the Malacas spouses acquired the rights to these shares (registered). Rosa similarly defaulted

with PNB but the auction sale was not annotated on the title. The Court gave PNB a new title. The CA

affirmed and ordered that the title to PNB and Reyes be annulled.

Held

After the death of her husband, the property is supposed to be under co-ownership of Rosa and her

children. She is entitled therefore to only ½. By herself alone, she cannot mortgage the whole property.

Assuming that the mortgage to PNB was valid, it would be so only with regard to the ½ owned by Rosa.

Under Art 493, any alienation or mortgage by a co-owner shall be limited to the portion which may be allotted

to him in the division upon the termination of the co-ownership.

But the failure of PNB to cause annotation of its mortgage within 1 yr from issuance of the title is fatal to

its claim. Land registration proceedings are proceedings in rem and upon the expiration of the 1 year within

which a petition to review the decree of registration may be filed, said decree and the title pursuant thereto

amy no longer be changed, altered, or modified, much less set aside.

SUNSET VIEW CONDOMINIUM CORPORATION, petitioner, vs. THE HON. JOSE C. CAMPOS, JR. OF THE COURT OF FIRST INSTANCE, BRANCH XXX, PASAY CITY and AGUILAR-BERNARES REALTY, respondents. (G.R. No. L-52361 April 27, 1981) Facts: The petitioner, Sunset View Condominium Corporationis a condominium corporation within the meaning of Republic Act No. 4726 in relation to a duly registered Amended Master Deed with Declaration of Restrictions of the Sunset View Condominium Project located at 2230 Roxas

Boulevard, Pasay City of which said petitioner is the Management Body holding title to all the common and limited common areas. The private respondent, Aguilar-Bernares Realty, a sole proprietorship owned and operated by the spouses Emmanuel G. Aguilar and Zenaida B. Aguilar, is the assignee of a unit, “Solana”, in the Sunset View Condominium Project with La Perla Commercial, Incorporated, as assignor. The La Perla Commercial, Incorporated bought the “Solana” unit on installment from the Tower Builders, Inc. The petitioner, Sunset View Condominium Corporation, filed for the collection of assessments levied on the unit against Aguilar-Bernares Realty. The private respondent filed a Motion to Dismiss the complaint on the grounds (1) that the complaint does not state a cause of action: (2) that the court has no jurisdiction over the subject or nature other action; and (3) that there is another action pending between the same parties for the same cause. The petitioner filed its opposition. The motion to dismiss was granted by the respondent Judge, pursuant to Section 2 of Republic Act No. 4726, a “holder of a separate interest” and consequently, a shareholder of the plaintiff condominium corporation; and that “the case should be properly filed with the Securities & Exchange Commission which has exclusive original jurisdiction on controversies arising between shareholders of the corporation.” the motion for reconsideration thereof having been denied, the petitioner, alleging grave abuse of discretion on the part of respondent Judge, filed the instant petition for certiorari praying that the said orders be set aside. ISSUE: Whether the CFI or the City Courts have jurisdiction over the claims filed by Sunset View, the condominium corporation. Held: Not every purchaser of a condominium unit is a shareholder in the corporation. The Mater Deed determines when ownership of the unit and participation in the corporation vests in the purchaser. The City Court and the CFI have jurisdiction. The share of stock appurtenant to the unit win be transferred accordingly to the purchaser of the unit only upon full payment of the purchase price at which time he will also become the owner of the unit. Consequently, even under the contract, it is only the owner of a unit who is a shareholder of the Condominium Corporation. Inasmuch as owners is conveyed only upon full payment of the purchase price, it necessarily follows that a purchaser of a unit who has not paid the full purchase price thereof is not The owner of the unit and consequently is not a shareholder of the Condominium Corporation. In this case, the Master Deed provides that ownership is transferred only upon full payment of the purchase price. Private respondents have not yet fully paid the purchase price, hence they are not shareholders and the SEC has no jurisdiction over the claims. *now, special courts handle intra-corporate disputes

THIRD DIVISION

[G.R. No. 146890. June 8, 2004]

LILIAN CAPITLE, SOFRONIO CORREJADO, ARTEMIO CORREJADO, VICENTE CORREJADO, CECILIA CORREJADO, GLORIA VDA. DE BEDUNA, ROGELIA CORREJADO, MANUEL

CORREJADO, RODOLFO CORREJADO, TERESITA C. AMARANTE, JUANITA CORREJADO AND JULIETA C. PEREGRINO, petitioners, vs. JULIETA VDA. DE GABAN, JULIA CORREJADO AND HERMINIGILDO CORREJADO, respondents.

D E C I S I O N

CARPIO-MORALES, J.:

Fabian Correjado (Fabian) inherited from his father Santos Correjado two parcels of land subject of the case at bar, Lot No. 1782-B of the Pontevedra Cadastre and Lot No. 952 of the Hinigaran Cadastre containing 26,728 sq. m. and 55,591 sq. m., respectively.

Fabian died intestate in 1919. He was survived by four children, namely: Julian, Zacarias, Francisco and Manuel, all surnamed Correjado.

After Fabian’s death in 1919, his son Julian occupied and cultivated the two subject parcels of land (the property) until his death in 1950. He was survived by three children, namely, herein respondents Julieta vda. de Gaban (Julieta), Julia Correjado (Julia) and Hermegildo Correjado.

Julian’s brother Francisco died in 1960. He was survived by herein petitioners Manuel Correjado, Teresita C. Amarante, Juanita Correjado, Rodolfo Correjado, and Jileta Peregrino.

Julian’s brother Zacarias died in 1984. He was survived by the other petitioners herein, Aurora P. vda. de Correjado, Lilia Capitle, Artemio Correjado, Cecilia Correjado, Rogelia Correjado (Rogelia), Sofronio Correjado, Vicente Correjado and Gloria vda. de Beduna.

On November 26, 1986, petitioners filed a complaint[1] for partition of the property and damages before the Regional Trial Court (RTC) of La Carlota City against respondents, alleging that Fabian contracted two marriages, the first with Brigida Salenda who was the mother of Julian, and the subsequent one with Maria Catahay (Maria) who was the mother of Zacarias, Manuel and Francisco; that the property remained undivided even after the death of Julian in 1950, his children-herein respondents having arrogated unto themselves the use and enjoyment of the property, to the exclusion of petitioners; and that respondents refused to deliver petitioners’ share in the property despite demands therefor and for partition.

To the Complaint respondents countered in their Answer[2] that in the proceedings in the intestate estate of their great grandfather Santos Correjado, petitioners were not adjudicated any share in the property, for Maria, the mother of petitioners’ respective fathers Francisco and Zacarias, was just a mistress of Fabian, hence, Francisco and Zacarias (as well as Manuel) were illegitimate who were not entitled to inherit under the old Civil Code (Spanish Civil Code of 1889).

By Decision of December 29, 1992,[3] Branch 63 of the La Carlota City RTC dismissed the complaint upon the grounds of prescription and laches.

On appeal to the Court of Appeals wherein petitioners raised as sole error of the trial court its dismissal of the complaint “without basis in fact and in law,” the appellate court, by Decision of August 29, 2000,[4] dismissed the appeal and affirmed the decision of the trial court.

In affirming the decision of the trial court, appellant passed upon the issue of legitimacy of the brothers Francisco and Zacarias (as well as of their brother Manuel) in order to determine whether they co-owned the property with Julian, illegitimate children not being entitled to inherit under the Spanish Civil Code of 1889 [5] which was in force when the brothers’ father Fabian died in 1919.

The appellate court found that respondents failed to discharge the onus of proving that Francisco and Zacarias were illegitimate. But it too found that petitioners also failed to prove that Zacarias and Francisco were legitimate.

Upon the disputable presumption, however, that a man and a woman deporting themselves as husband and wife have entered into a lawful contract of marriage,[6] the appellate court presumed that Fabian and Maria were lawfully married, hence, their children Zacarias and Francisco (as well as Manuel)-predecessors-in-interest of petitioners were legitimate children and, therefore, they co-owned with Julian the property.

Its finding of co-ownership of the property by the predecessors-in-interest of the parties notwithstanding, the appellate court held that, as did the trial court, prescription and laches had set in, ratiocinating as follows:

It is a hornbook doctrine that the possession of a co-owner is like that of a trustee

and shall not be regarded as adverse to the other co-owners but in fact as beneficial

to all of them so much so that each co-owner may demand at anytime the partition

of the common property and that this implies that an action to demand partition is

imprescriptible or cannot be barred by laches (Salvador vs. Court of Appeals, 243

SCRA 23; De Castro vs. Echarri, 20 Phil. 23).

While the right of action to demand partition does not

prescribe, acquisitive prescription may set in where one of the co-

owners openly and adversely occupies the property without recognizing the co-

ownership (Cordova vs. Cordova, 102 Phil. 1182; Heirs of Segunda Manungding

vs. Court of Appeals, 276 SCRA 601), The statute of limitations operates, as in

other cases, from the moment such adverse title is asserted by the possessor of the

property (Ramos vs. Ramos, 45 Phil. 362; Bargayo vs. Camumot, 40 Phil. 857).

The elements constituting adverse possession by a co-owner against another co-

owner or cestui que trust are: (1) that he has performed unequivocal acts of

repudiation amounting to an ouster of the cestui que trust or other co-owners; (ii)

that such positive acts of repudiation have been made known to the cestui

que trust or the other co-owners; and (iii) that the evidence thereon must be clear

and convincing (Salvador vs. Court of Appeals, supra).

Granting that appellants, as well as their predecessors-in-interest, were initially co-

owners of the disputed property,

nevertheless, acquisitive prescription in favor of appellees had

already set in. Appellees had performedunequivocal acts of repudiation. This is

shown by the unrebutted testimony of [herein respondent] Julia who declared that

her brother Atilano (deceased) introduced improvements on the disputed property

and the fact that appellees and

their father Julian paid the realty taxes thereon as exclusive owners

thereof. Moreover, applicants admitted in paragraph 12 of the Complaint

that after Julian‟s death (in 1950),

appellees arrogated untothemselves the use and enjoyment of the disputed property

, to the exclusion of appellants. This admission is bolstered by [herein petitioner]

Rogelia‟s testimony, as follows:

Q By the way you said that you are going to recover this 1/6 share from Julieta vda. de Gaban. Why, is she in possession of this land?

A Yes, sir.

Q She is presently in possession of the said lot?

A Yes, sir.

Q Can you tell us since when did she possess that land?

A 1980.

Q Previous to that, can you tell us if she was in possession of the said land?

A Yes, sir. She has been in possession of the said lot before 1980.

Q Was there a period of years that you have been in possession of the said land?

[A No, sir. We have never been in possession of the said land.]

x x x

Q Were you able to gather benefits from that land?

A We never benefited.

Q Since when have you not benefited from that land?

A Since 1919.

x x x

Q By the way, can you tell us since when you have been deprived of that land, from what year?

A From 1919 to 1990.” (TSN, January 9, 1990, pp. 51-55). (Underscoring supplied)[7]

Petitioners filed a motion for reconsideration[8] of the appellate court’s decision upon the ground that “THIS CASE HAS BEEN OVERTAKEN BY EVENTS, PARTICULARLY ART. 19 OF THE [NEW] CIVIL CODE” which reads:

ART. 19. Every person, must be in the exercise of his rights and in the

performance of his duties, act with justice, give everyone his due, and observe

honesty and good faith,

citing some cases in support thereof.

Finding the invocation of Art. 19 misplaced, the appellate court, by Resolution of February 7, 2001,[9] denied the Motion for Reconsideration, hence, the present petition[10] proffering the following

ISSUES FOR RESOLUTION

I

WHETHER OR NOT RELIANCE ON ART. 19 OF THE CIVIL CODE

ISMISPLACED.

II

WHETHER IN RESOLVING CASES, THE ISSUE OF MORALITY OF THE

ACT DOES NOT COME INTO PLAY.

III

WHETHER OR NOT LACHES IS APPLICABLE IN THE CASE AT BAR.[11]

Petitioners contend that “[t]here is such a thing as morality that comes into play,” as after all, the appellate court found the parties to be first cousins and, therefore, following Art. 19 of the Civil Code, petitioners should get their share in the property.

Petitioners further contend that “laches is not strictly applied when it comes to close relations,” citing Gallardo v. IAC, 155 SCRA 248.

The petition fails.

Article 19 of the Civil Code in Chapter 2 on Human Relations is a statement of principle that supplements but does not supplant a specific provision of law.

With respect to rights to the inheritance of a person who died before the effectivity on August 30, 1950 of the Civil Code like Fabian who died in 1919:

Art. 2263, New Civil Code

ART. 2263. Rights to the inheritance of a person who died, with or without a will,

before the effectivity of this Code, shall be governed by the Civil Code of 1889, by

other previous laws, and by the Rules of Court. x x x

ART. 807, Spanish Civil Code of 1889

ART 807. The following are forced heirs:

1. Legitimate children and descendants, with respect to their legitimate parents

and ascendants;

2. In default of the foregoing, legitimate parents and ascendants, with respect to

their legitimate children and descendants;

The widower or widow, natural children legally acknowledged, and the father or

the mother of the latter, in the manner and to the extent established by Articles 834,

835, 836, 837, 840, 841, 842, and 846.

ART. 939, Spanish Civil Code of 1889,

ART. 939. In the absence of legitimate descendants and ascendants, the natural

children legally acknowledged and those legitimated by royal concession shall

succeed to the entire estate of the deceased.

With respect to prescription:

Art. 1134, New Civil Code

ART. 1134. Ownership and other real rights over immovable property are

acquired by ordinary prescription through possession of ten years.

Art. 1137, New Civil Code

ART. 1137. Ownership and other real rights over immovables also prescribe

through uninterrupted adverse possession thereof for thirty years, without need of

title or of good faith.

Assuming arguendo that petitioners’ respective fathers Francisco and Zacarias were legitimate and, therefore, were co-owners of the property: From the moment co-owner Julian occupied in 1919 and claimed to be the absolute and exclusive owner of the property and denied his brothers any share therein up to the time of his death in 1950, the question involved is no longer one of partition but of ownership in which case imprescriptibility of the action for partition can no longer be invoked. The adverse possession by Julian and his successors-in-interest- herein respondents as exclusive owner of the property having entailed a period of about 67 years at the time of the filing of the case at bar in 1986, ownership by prescription had vested in them.[12]

As for estoppel by laches which is a creation of equity,[13] since laches cannot interfere with the running of the period of prescription, absent any conduct of the parties operating as estoppel,[14] in light of the prescription of petitioners’ action, discussion thereof is dispensed with. Suffice it to state that while laches may not be strictly applied between near relatives, under the facts and circumstances of the case, especially the uncontroverted claim of respondents that their father Julian, and the documented claim of respondent Julieta, had paid realty taxes on the property as exclusive owner, as well as the admission of petitioner Rogelia that, as quoted above, she and her co-petitioners “never benefited” or were “deprived” of any

benefits from the property since 1919 up to the time of the filing of the case in 1986 before the RTC or for a period of 67 years, despite demands therefor, even an extremely liberal application of laches would bar the filing of the case.

WHEREFORE, the petition is hereby DISMISSED and the decision of the Court of Appeals is AFFIRMED.

SO ORDERED.

Vitug, (Chairman), Sandoval-Gutierrez, and Corona, JJ., concur.