Manuel L. Bautista, et al. vs. Margarito L. Bautista

SECOND DIVISION

March 8, 2017

G.R. No. 202088

MANUEL L. BAUTISTA, SPOUSES ANGEL SAHAGUN and CARMELITA BAUTISTA, and ANIANO L. BAUTISTA , Petitioners vs MARGARITO L. BAUTISTA, Respondent

DECISION

PERALTA, J.:

Assailed in this petition for review on certiorari filed by petitioners Manuel L. Bautista, Spouses Angel Sahagun and Carmelita Bautista, and Aniano L. Bautista before this Court is the Decision1 dated March 6, 2012 and Resolution2 dated May 25, 2012 of the Court of Appeals (CA) which reversed the Decision3 dated February 16, 2009 of the Regional Trial Court (RTC) of San Pablo City, Branch 32, declaring that the subject property covered by Transfer Certificate of Title (TCT) No. T-59882 is exclusively owned by respondent Margarito L. Bautista (Margarito).

The factual and procedural antecedents follow:

The present case stemmed from a Complaint for Partition and Accounting with Prayer for Temporary Restraining Order and/or Writ of Preliminary Injunction filed by the petitioners against Margarito and the other defendants over several properties allegedly co-owned by them, which included the subject property.

The Bautista siblings - Margarito, Manuel L. Bautista, Carmelita Bautista Sahagun (Carmelita), Aniano L. Bautista (Aniano), Florencia Bautista de Villa (Florencia), and Ester Bautista Cabrera (Ester) - established a lending business through a common fund from the proceeds of the sale of a parcel of coconut land they inherited from their mother Consorcia Lantin Bautista.4 Margarito, Florencia, and Ester managed the business with Reginald Sahagun, Carmelita's son, as credit investigator.5 Senen Cabrera, Ester's husband, prepared the documents for mortgage and reported the status of the lending business to the Bautista siblings.6 Through the said lending business, the siblings acquired several real properties in San Pablo City.7

On March 2, 1998, Amelia V. Mendoza (Amelia) obtained a loan in the amount of P690,000.00 from Florencia, and secured the same with a real estate mortgage over a 25,518-square-meter parcel of land she owned situated at Barangay Sta. Monica, San Pablo City, denominated as Lot 2, Plan Psu-45117 and covered by Transfer Certificate of Title (TCT) No. T-2371 (Sta. Monica property).8 They later extended the mmigage through a Kasulatan ng Pagdaragdag ng Sanla, for an additional loan of ₱l15,000.00 on April 6, 1998.9

On May 13, 1998, Amelia and Florencia renewed the mortgage for ₱l,085,000.0010 and cancelled the previous loan of ₱690,000.00 through a "Cancellation and Discharge of Mortgage."11

Subsequently, on April 12, 1999, Amelia and Florencia executed another Kasulatan ng Pagdaragdag ng Sanla in the amount of ₱57,500.00.12 Florencia, thereafter, received the owner's duplicate copy of TCT No. T-2371, which she, in turn, entrusted to Carmelita when she went overseas.

On November 28, 2002, Amelia allegedly sold the subject property to Margarito through a Kasulatan ng Bilihang Tuluyan13 for ₱500,000.00 and, likewise, cancelled the ₱l,085,000.00 loan through another "Cancellation and Discharge of Mortgage."14 On the same date, Florencia filed a Petition for the Issuance of a Second Owner's Duplicate of TCT No. T-2371 before the RTC of San Pablo City, Branch 29.15 She alleged that she was the mortgagee of the subject property, and that she could not locate, despite diligent search, the owner's duplicate title in her possession, which she misplaced sometime in September 2002.16 Florencia also executed a Special Power of Attorney in favor of Margarito to represent her in the proceedings.17

Petitioners tried to oppose the issuance,18 but on January 30, 2003, the RTC granted the petition and TCT No. T-59882 was later issued in the name of Margarito.19 On January 12, 2004, petitioners registered an Adverse Claim over the Sta. Monica property, which was annotated on TCT No. T-59882.20

Failing to settle their differences, petitioners subsequently instituted a Complaint for Partition and Accounting with Prayer for Temporary

Restraining Order and/or Writ of Preliminary Injunction docketed as Civil Case No. SP-6064(04) before the RTC of San Pablo City, Branch 32, over several properties against herein respondent Margarito, the Spouses Marconi de Villa and Florencia Bautista, and the Spouses Senen Cabrera and Ester Bautista.21

Petitioners averred that Margarito and the others refused to heed their oral and written demands for the partition of the properties they co-owned, which included the Sta. Monica property.22

On April 23, 2004, the parties filed a "Partial Settlement" manifesting that they have entered into an amicable settlement over the other properties involved in the complaint.23 In a Decision24 dated April 28, 2004, the RTC approved the compromise agreement.

Since no settlement was reached as regards the Sta. Monica property, petitioners presented copies of their bank transactions with Far East Bank to support their claim of co-ownership over the same.25 They also presented an undated, unnotarized, and without the name of the vendee Kasulatan ng

Bilihang Tuluyan (blank Kasulatan ), which Amelia purportedly executed and signed disposing the subject property in favor of the Bautista siblings.26 Petitioner Carmelita also alleged that the duplicate copy of TCT No. T-2371 in the name of Amelia was in her possession and was never lost.

For his part, Margarito asseverated that he exclusively owns the property in controversy since he used his personal funds in purchasing the land.27 Margarito presented TCT No. T-59882 covering the Sta. Monica property, and the Tax Declaration and Receipts thereof.28

On February 16, 2009, the RTC ruled in favor of the petitioners and declared, among other things, that the Sta. Monica property was commonly owned by the siblings.29 The RTC also ordered that the property be partitioned among all of them and that an accounting of its income be held. The dispositive portion of the decision reads:

WHEREFORE, judgment is hereby rendered, as follows:

a. Declaring the lot covered by Transfer Certificate of Title No. T-59882, with an area of 25,578 square meters, situated at Barangay Sta. Monica, San Pablo City, as commonly owned by the plaintiffs and defendants;

b. Ordering the partition of the lot covered by Transfer Certificate of Title No. T-59882 between and among Manuel L. Bautista, Carmelita B. Sahagun, Margarito L. Bautista, Florencia Bautista De Villa, Aniano L. Bautista and Ester B. Cabrera;

c. Ordering defendant Margarito Bautista to render an accounting of all the income from the subject lot in litigation from November 28, 2002, up to the present, until the rendition of the account; and d. Directing defendant Margarito Bautista to deliver to the plaintiffs and the other defen4ant their respective shares of the income derived from the lot in litigation starting November 28, 2002.

No pronouncement as to the award of damages, attorney's fees, and costs.

SO ORDERED.30

On March 3, 2009, Margarito filed a Motion for Reconsideration,31 but the RTC denied it in an Order32 dated April 2, 2009.

Aggrieved, Margarito elevated the case before the CA. In a Decision dated March 6, 2012, the CA reversed and set aside the decision of the RTC. Thefallo of the decision reads:

WHEREFORE, premises considered, the Appeal is GRANTED. The Decision dated February 16, 2009 of the Regional Trial Court of San Pablo City, Branch 32 is hereby SET ASIDE. The subject property covered by Transfer Certificate of Title (TCT) No. T-59882 under the name of defendant-appellant Margarito L. Bautista is declared exclusively owned by defendant-appellant Margarito L. Bautista.

SO ORDERED.33

The CA concluded that petitioners failed to establish that they are coowners of the Sta. Monica property. It held that the TCT under Margarito's name was an indefeasible and incontrovertible title to the property and has more probative weight than the blank Kasulatan adduced by the petitioners. Consequently, petitioners' action for partition and accounting cannot be acted upon because they failed to prove that they are co-owners of the Sta. Monica property.

Petitioners filed a Motion for Reconsideration, but it was denied in the Resolution dated May 25, 2012.

Hence, the present recourse raising the following errors on the part of the appellate court:

A. The Court of Appeals seriously erred when it relied on the case of Manuel Catindig vs. Aurora Irene Vda. de Meneses which led to a conclusion that the TCT held by the defendant-appellant serves as an indefeasible and incontrovertible title to said property.

B. The Decision promulgated on March 06, 2012 subject of this Petition failed to consider the fact that the appealed Decision dated February 16, 2009 of the court a quo is already final and executory, and for which reason, the Court of Appeal[s] has no jurisdiction to entertain the Appeal.

C. The Court of Appeals erred when it failed to appreciate the fact that there was a compromise decision based on an agreement by all the parties which included property where some of the titles are already in the names of the siblings concerned.

D. The Court of Appeals thus erred when it did not give weight to the evidence presented by the petitioners-appellees and this is notwithstanding the findings of the court a quo in their favor.

The petition is impressed with merit.

As a general rule, the jurisdiction of this Court in cases brought before it from the CA is limited to the review and revision of errors of law allegedly committed by the appellate court in petitions for review under Rule 45 of the

Rules of Court.34 We note that the arguments raised here would necessarily require a re-evaluation of the parties' submissions and the CA's factual findings. Nevertheless, the need to make a definitive finding on the factual issue in light of the conflicting rulings rendered by the RTC and the CA justifies this Court's review.35

At the outset, petitioners maintain that the CA has no jurisdiction to entertain the appeal since the Decision dated February 16, 2009 of the RTC was already final and executory. They claim that the motion for reconsideration filed by Margarito before the R TC was not in accordance with the Rules because a copy of the said motion was served or received by them through a private courier service and that there was a defect in the verification or affidavit of service.36

The Rules provide that pleadings may be filed in court either personally or by registered mail.37 In the first case, the date of filing is the date of receipt. In the second case, the date of mailing is the date of receipt.

Though filing of pleadings thru a private courier is not prohibited by the Rules, it is established in jurisprudence that the date of actual receipt of pleadings by the court is deemed the date of filing of such pleadings, and not the date of delivery thereof to a private letter-forwarding agency.38 Records reveal that respondent received a copy of the Decision on February 23, 2009. In an Order39 dated March 5, 2009, the trial court acknowledged that it received the motion for reconsideration filed by respondent on March 4, 2009, or on the 9th day, which is still within the reglementary period.

The RTC gave petitioners 15 days from notice to file a comment on the motion for reconsideration filed by respondent. Petitioners filed its Opposition to the Motion for Reconsideration on March 12, 2009.40 In their Opposition, petitioners pointed the defect in the service of the motion when the same was delivered through LBC, a private courier. They also alleged therein that the motion should be denied as it would prejudice their rights. From the foregoing, the RTC gave petitioners the opportunity to be heard, and sufficient time to study the motion and meaningfully oppose the same. It was not even alleged nor proven that the motion for reconsideration was filed out of time. Considering the circumstances, the purpose of the service of the motion was substantially complied with. The Rules should be liberally construed as long as their purpose is sufficiently met and no violation of due process and fair play takes place.41

While We disagree with the petitioners on the procedural issues, this Court, however, finds cogent reasons to grant the petition based on the substantial issues raised in the case at bar.

It is to be noted that the present action stemmed from an action for partition and accounting. A special civil action of judicial partition under Rule 69 of the Rules of Court is a judicial controversy between persons who, being co-owners or coparceners of common property, seek to secure a division or partition thereof among themselves, giving to each one of them the part corresponding to him.42 The object of partition is to enable those who own property as joint tenants, or coparceners, or tenants in common to put an end to the joint tenancy so as to vest in each a sole estate in specific property or an allotment in the lands or tenements.43 It is typically brought by a person claiming to be the owner of a specified property against a defendant or defendants whom the plaintiff recognizes to be his co-owners44 and is premised on the existence or non-existence of co-ownership between the parties.45 Hence, unless and until the issue of co-ownership is definitively resolved, it would be premature to effect a partition of an estate.46

Consequently, the first stage of an action for judicial partition and/or accounting is concerned with the determination of whether or not a coownership in fact exists and a partition is proper.47 In the case at bar, petitioners aver that although the Sta. Monica property was registered solely in Margarito's name, they are co-owners of the property because it was acquired through the siblings' lending business, as such, they are entitled to partition and the conveyance to them of their respective shares.

To support their allegations, petitioners presented several mortgage contracts evidencing the transactions between Amelia and Florencia, computer printouts of their bank transactions, and the blank Kasulatan. In Carmelita's direct testimony, she illustrated how they acquired properties through their lending business and how ownership of the properties was transferred under their names. She also testified that the money used in the purchase of the Sta. Monica property came from their common fund. The pertinent portions of her testimony read:

ATTY. JAVIER

Q: And how did you acquire these properties?

A: Through our lending activities, sir.

Q: Would you care to illustrate the actual acquisition or demonstrate the acquisition?

A: If the borrower failed to pay, she or he [is] requested to secure the Deed of Sale, sir.

COURT

Paano, paano? Tagalugin nga.

A: We foreclosed the mortgage, sir.

A TTY. JAVIER

Q: But there was the mentioning of a Deed of Sale?

A: We asked the borrower to execute the Deed of Sale, sir.

Q: And by these sales, in whose names were these properties put?

A: To us, on our names, sir.

x x x x x x x x x

ATTY: JAVIER

Q: Now, I am asking you, how about the Sta. Monica property?

A: The Sta. Monica is co-owned also by six (6), sir.

Q: Why do you say so?

A: Because the money acquired... Ang pera... The money used in buying that property came from the common funds, sir.

Q: Do you have tangible proof of this?

A: The computer [printout] as to the one withdrawn in our bank account, Slf.

Q: Is this the one you are referring to?

A: Yes, this [is] what I mean, all the transactions are here, sir.

Q: Do you have other than these computer [printouts], Exhibit "B," do you have any tangible proof that the Sta. Monica property is co-owned by the six (6) Bautista siblings?

A: The blank Deed of Sale issued, sir.

Q: I am now showing to you a Kasulatan ng Bilihang Tuluyan already previously marked as Exhibit "E" and consisting of two (2) pages, could this be that Kasulatan?

A: This is the document I am referring to, sir.

For the record, we wish that it be reflected that the Kasulatan does not indicate although it indicates the vendor, does not indicate the vendee, Your Honor. And the same has not been notarized.48

From the foregoing, petitioners established the manner in which they acquired several properties through their business and have them registered under their names. Even the compromise agreement they entered into, which was approved by the RTC, reflected their claim and admission that they co-owned the properties although titled to only one of their siblings. It was, thus, logical for the RTC to conclude that it was through this practice that they also acquired the Sta. Monica property.

Moreover, several other circumstances buttressed petitioners' claim, among which is that they have proven that their lending business has the financial capacity to acquire the Sta. Monica property; that Florencia, who was co-manager of the business, entered into several mortgage transactions with Amelia; and that the blank Kasulatan was in their possession. They even opposed the issuance of a second owner's duplicate copy of TCT No. T-2371 since the original TCT was in their safekeeping and was not actually lost.

As for Margarito, he narrated in his direct testimony how the ownership of the property was allegedly transferred to him:

ATTY.REYES

Q: Will you kindly tell the Honorable Court, how it came about this property in Sta. Monica, San Pablo City was purchased by you, I am referring to the Deed of Sale of Amelia Mendoza from the start up to the final deed of sale?

A: That property was mortgaged to my sister Florencia de Villa, and part of the money came from my own money. At that time Amelia Mendoza informed me that she would like to sell that property to both of us[,] Florencia and I, and then Florencia de Villa asked me if I am interested to buy that property.

Q: What was your answer?

A: I told her that I am interested.

Q: What finally happened, when Amelia Mendoza informed you about that Deed of Sale, what was the final consideration of the Deed of Sale?

A: What was stated in the Absolute Deed of Sale was [₱]500,000.00.

Q: But again that was actually paid by you?

A: What was stated in the annotation at the back of the title plus Amelia Mendoza asked for additional amount of ₱50,000.00.

x x x x

ATTY. REYES

Q: Do you remember Mr. Witness, when did you execute the Deed of Sale with Amelia Mendoza?

A: More or less on November 28, 2002.

Q: Do you have a copy of that document?

A: I will try to look with the files I have on hand.

I have here the document stating the amount of [₱]500,000.00 only.

Q: Why [did it take] you four (4) years in order to execute that Deed of Sale?

A: Because the mortgage to sell was prepared in order for them to redeem the property and at the same time to return the money we have given.

x x x x49

The CA held that Margarito presented pieces of evidence, including a deed of sale between Amelia and Margarito. However, as found by the RTC and based on the List of Exhibits, aside from his bare allegations and testimony, Margarito neither identified nor presented the deed of sale during trial nor formally offered the same as his evidence.50 It is elementary that he who alleges a fact has the burden of proving it and a mere allegation is not evidence.51 It appears that Margarito's evidence of exclusive ownership are the certificate of title, the tax declarations pertaining thereto, his bank deposits, and other mortgage contracts involving different mortgagors. Despite all these, Margarito failed to prove that Amelia conveyed the Sta. Monica property exclusively in his name. It is also quite intriguing why he did not even bother to present the testimony of Amelia or of Florencia, who could have enlightened the court about their transactions. In addition, We find it incredible that a property, which secured a loan roughly over a million pesos, would be sold for considerably less than that amount or for only ₱550,000.00.

As for the TCT No. T-59882 in the name of Margarito, like in the case at bar, although a certificate of title is the best proof of ownership of a piece of land, the mere issuance of the same in the name of any person does not foreclose the possibility that the real property may be under co-ownership with persons not named in the certificate or that the registrant may only be a trustee or that other parties may have acquired interest subsequent to the issuance of the certificate of title.52 The principle that a trustee who puts a certificate of registration in his name cannot repudiate the trust by relying on the registration is one of the well-known limitations upon a title.53

There is an implied trust when a property is sold and the legal estate is granted to one party but the price is paid by another for the purpose of having the beneficial interest of the property.54 This is sometimes referred to as a purchase money resulting trust, the elements of which are: (a) an actual payment of money, property or services, or an equivalent, constituting valuable consideration; and (b) such consideration must be furnished by the alleged beneficiary of a resulting trust.55

A trust, which derives its strength from the confidence one reposes on another especially between families, does not lose that character simply because of what appears in a legal document.56 From the foregoing, this Court finds that an implied resulting trust existed among the parties. The pieces of evidence presented demonstrate their intention to acquire the Sta. Monica property in the course of their business, just like the other properties that were also the subjects of the partition case and the compromise agreement they entered into. Although the Sta. Monica property was titled under the name of Margarito, the surrounding circumstances as to its acquisition speak of the intent that the equitable or beneficial ownership of the property should belong to the Bautista siblings.

Inevitably, the RTC's Order of partition of the Sta. Monica property was erroneously set aside by the CA and this Court is convinced that petitioners satisfactorily established that they are co-owners of the property and are entitled to the reliefs prayed for.

WHEREFORE, the petition is hereby GRANTED. The Decision dated March 6, 2012 and the Resolution dated May 25, 2012 of the Court of Appeals in CA-G.R. CV No. 93562 are REVERSED and SET ASIDE. Consequently, the Decision dated February 16, 2009 of the Regional Trial Court of San Pablo City, Branch 32, in Civil Case No. SP-6064(04) is REINSTATED.

SO ORDERED.

DIOSDADO M. PERALTAAssociate Justice

WE CONCUR:

ANTONIO T. CARPIOAssociate JusticeChairperson

FRANCIS H. JARDELEZAAssociate Justice

A T T E S T A T I O N

I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court's Division.

ANTONIO T. CARPIOAssociate JusticeChairperson, Second Division

C E R T I F I C A T I O N

Pursuant to the Section 13, Article VIII of the Constitution and the Division Chairperson's Attestation, I certify that the conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the opinion of the Court's Division.

MARIA LOURDES P.A. SERENOChief Justice

Footnotes

1 Penned by Associate Justice Fiorito S. Macalino, with Associate Justices Remedios S. Salazar-Fernando and Ramon M. Bato, Jr., concurring, rollo, pp. 40-49.

2 Id. at 51-53.

3 Penned by Judge Agripino G. Morga; id. at 72-81.

4 Rollo, p. 41.

5 Id. at 42.

6 Id

7 Id.at41.

8 Id. at 74.

9 Id

10 Id. at 43.

11Id.

12 Id. at 74.

13 Id. at 43.

14 Id. at 43-44.

15 Id. at 43.

16 Id.

17 Id. at 43-44.

18 Id. at 44.

19 Id.

20 Id. at 76.

21 Id. at 44.

22 Id.

23 Id. at45.

24 Penned by Judge Zorayda Herradura-Salcedo; records, Vol. I, pp. I IO-l l(/3.

25 Rollo, p. 45.

26 Id.

27 Id.

28 Id.

29 Id. at 72-81.

30 Id. at 81.

31 Records, Vol. 2, pp. 459-465.

32 Id. at 481-486.

33 Rollo, p. 48.

34 Tong, et al. v. Go Tiat Kun, et al., 733 Phil. 581, 590 (2014).

35 Id.

36 Rollo, pp. 32-33.

37 Sec. 3. Manner of filing. - The filing of pleadings, appearances, motions, notices, orders, judgments and all other papers shall be made by presenting the original copies thereof, plainly indicated as such, personally to the clerk of court or by sending them by registered mail. In the first case, the clerk of court shall endorse on the pleading the date and hour of filing. In the second case, the date of the mailing of motions, pleadings, or any other papers or payments or deposits, as shown by the post office stamp on the envelope or the registry receipt, shall be considered as the date of their filing, payment, or deposit in court The envelope shall be attached to the record of the case.

38 Heirs of Numeriano Miranda, Sr. v. Miranda, 713 Phil. 541, 550 (2013), citing Philippine National Bank v. Commissioner of internal Revenue, 678 Phil. 660, 673 (2011). (Emphases supplied)

39 Records, Vol. 2, p. 467.

40 Id. at 468-471.

41 People v. Court of Appeals, G.R. No. 183652, February 25, 2015, 751 SCRA 675, 693.

42 Oribello v. Court of Appeals, G.R. No. 163504, August 5, 2015, 765 SCRA 18, 32-33.

43 id. at 33.

44 De Mesa v. Court of Appeals, 301 Phil. 783, 792 (1994).

45 Spouses Villafria v. Plaza, G.R. No. 187524, August 5, 2015, 765 SCRA 227, 250.

46 Id.

47 De Mesa v. Court of Appeals, supra note 44.

48 TSN, December 20, 2005, pp. 13-14; 17-19. (Emphases ours).

49 TSN, April 29, 2008, pp. 8-9; 15-16. (Emphases ours)

50 Rollo, p. 79.

51 Luxuria Homes, Inc. v. CA, 361 Phil. 989, 1000 (1999).

52 Lee Tek Sheng v. CA, 354 Phil. 556, 561-562 (1998).

53 Tong v. Go Tiat Kun, supra note 35, at 593.

54 Article 1448 of the Civil Code.

55 Tong v. Go Tiat Kun, supra note 35, at 592-593.

56 Id. at 593.