Constantino v. Estenzo
REITERATIONFacts
The Antecedents: Petitioner Ruperta Constantino, the sole surviving heir of Dionisia Caberos and Martin Constantino, filed a complaint for annulment of documents, cancellation of transfer certificates of title, and recovery of real property with damages. She alleged that her parents owned an agricultural land, evidenced by O.C.T. No. 35984, later reconstituted as O.C.T. No. RO-102. In August 1970, she discovered that O.C.T. No. RO-102 had been cancelled based on a deed of extrajudicial settlement and partition dated June 15, 1959, executed by Elpidio Adolfo, Norberta Caberos, and Florentina Caberos, who claimed to be the sole heirs. Subsequently, one-half of the property was sold to Numeriano Sadia and the other half to Elpidio Adolfo, leading to the issuance of T.C.T. No. T-2337 in favor of Sadia and Adolfo. Adolfo later sold his share to Valentin and Elvira Dulce, resulting in T.C.T. No. 3722 being issued in favor of the Dulces and Sadias. Petitioner claimed the deed of extrajudicial settlement was simulated, making it void and of no effect, and that the subsequent sales were likewise null and void ab initio. Procedural History: Respondent Judge Numeriano C. Estenzo of the Court of First Instance of Ormoc City dismissed petitioner's complaint on a Motion to Dismiss filed by respondent Numeriano Sadia, on the ground of prescription. Sadia argued that fourteen years had elapsed from the date of the extrajudicial settlement and sale on June 15, 1959. The respondent Judge treated the grounds for dismissal as affirmative defenses, ordered the parties to submit memoranda, and subsequently dismissed the case, finding the action to be for recovery of real property on the ground of fraud, which should have been filed on or before December 13, 1966, thus time-barred. The Petition: Petitioner sought a review of the dismissal order, arguing that the respondent Judge erred and gravely abused his discretion by dismissing the complaint without a trial on the merits. She contended that her complaint alleged a simulated deed of extrajudicial settlement, which is void ab initio, and that actions to declare such simulated contracts illegal or invalid do not prescribe.
Issue(s)
Whether the respondent Judge erred and gravely abused his discretion in summarily dismissing the petitioner's complaint on the ground of prescription without a trial on the merits.
Ruling
The Supreme Court ruled that the respondent Judge erred in dismissing the complaint on the ground of prescription without a trial on the merits. The Court set aside the appealed order of dismissal and remanded the case to the court below for trial on the merits.
Ratio Decidendi
On Issue 1: The Supreme Court ruled that the trial court's summary dismissal was improper because the petitioner's cause of action was specifically anchored on the claim that the 'extrajudicial settlement of the estate of deceased person' was purely simulated and void ab initio. The Court emphasized that under Article 1409 (2) of the Civil Code, contracts that are absolutely simulated or fictitious are inexistent and void from the beginning. Consequently, Article 1410 of the same Code explicitly provides that the action or defense for the declaration of the inexistence of a contract does not prescribe. The Court cited its previous ruling in Garanciang v. Garanciang (G.R. No. L-22351), which established that when a complaint alleges a deed of sale is void due to the absence of cause or consideration, it is error for a trial court to dismiss the case based on prescription. The Supreme Court noted that summary or outright dismissals are not appropriate where there are factual disputes—such as whether the parties to the settlement were indeed strangers to the estate—which require the presentation and appreciation of evidence. Furthermore, the Court cautioned against 'short-cuts' in judicial processes that impede the judicious dispensation of justice and deprive litigants of their right to a fair and impartial hearing. Therefore, the respondent Judge should have deferred the issue of prescription and proceeded to a trial on the merits after requiring all respondents to answer.
Main Doctrine
An action to declare the inexistence of a contract, such as a simulated or fictitious deed of extrajudicial settlement, does not prescribe.