Nacalaban v. Court of Appeals
REITERATIONFacts
1. The Antecedents: The underlying dispute concerns the ownership and partition of a parcel of land located at Corrales Extension, Telegrapo, Cagayan de Oro City, with an area of 4,082 square meters. The plaintiffs, claiming to be heirs of the late spouses Narciso Cababarros and Narcisa Edmilao, alleged that this land was acquired by their predecessors and later placed in trust with the defendants, Faustina Vda. de Nacalaban and her late husband Dioniciano Nacalaban. The plaintiffs further contended that the defendants fraudulently secured a certificate of title in their names without the plaintiffs' knowledge or consent and subsequently refused to deliver the plaintiffs' rightful shares upon demand. 2. Procedural History: The plaintiffs, including Rosita Cababarros and others, along with the Abejo minors represented by their mother, initiated Civil Case No. 2317 in the Court of First Instance of Misamis Oriental on February 11, 1964, seeking partition of the land and reconveyance of their shares. The defendants denied the plaintiffs' claims, asserting that Narciso Cababarros and Narcisa Edmilao were no longer owners of the land prior to their deaths and that the land was exclusively owned by the Nacalaban spouses, evidenced by a Torrens title obtained long before World War II. The Court of First Instance ruled in favor of the plaintiffs, ordering partition and reconveyance. This decision was affirmed in toto by the Court of Appeals in CA-G.R. No. 41486-R. The defendants, now petitioners, sought review of this appellate court decision. 3. The Petition: This case comes before the Supreme Court via a petition for certiorari, filed by Faustina Cababarros Vda. de Nacalaban and others, seeking to review the decision of the Court of Appeals. The petitioners argue that the Court of Appeals erred in declaring the respondents as co-owners, asserting there was no evidence of fraud to justify an implied trust, especially since the Original Certificate of Title No. 6929 was adjudicated as conjugal property of the petitioners. Furthermore, the petitioners contend that the respondents' action was barred by prior judgment and/or prescription. The Supreme Court, in its review, found that Narciso Cababarros and Narcisa Edmilao were no longer owners of the land at the time of their deaths, as it had been foreclosed and subsequently purchased by the Nacalaban spouses. The Court also determined that the respondents' cause of action, even if an implied trust existed, had prescribed, as the action was filed more than ten years after the issuance of the title in 1938 and after a prior demand and refusal in 1945.
Issue(s)
Whether the respondent Court of Appeals erred in installing the plaintiffs-respondents as co-owners of the land in suit since there is no evidence of fraud to justify the creation of an implied trust. Whether the respondent Court of Appeals erred in not holding the plaintiffs-respondents' action barred by prior judgment and/or by prescription.
Ruling
The Supreme Court set aside the decision of the Court of Appeals and dismissed the complaint. The Court found that the original owners, Narciso Cababarros and Narcisa Edmilao, were no longer owners of the land at the time of their death, as it had been foreclosed and subsequently purchased by the spouses Dioniciano Nacalaban and Faustina Cababarros. The Court also ruled that the action for partition and reconveyance was barred by prescription, as it was filed more than ten (10) years after the issuance of the Torrens title to the defendants, which constituted constructive notice.
Ratio Decidendi
On the issue of co-ownership and implied trust: The Court found no evidence of fraud to justify the creation of an implied trust. The records showed that the land was mortgaged by the original owners to secure the debt of their son, Gerardo Cababarros. Upon failure to pay the indebtedness, the mortgage was foreclosed, and the land was acquired by Casimiro Tamparong. Subsequently, the spouses Dioniciano Nacalaban and Faustina Cababarros purchased the land from Tamparong. Based on this purchase, they claimed the land in cadastral proceedings, leading to the issuance of Original Certificate of Title No. 6929 in their names. The Court emphasized that the original owners were no longer owners when they died, thus, their heirs (the plaintiffs) could not have inherited any right to the land. The subsequent actions of the defendants, such as mortgaging the property and selling a portion for road extension, further indicated their exclusive ownership. On the issue of prescription and laches: The Court held that the action for partition and reconveyance was barred by prescription. The cause of action arose on January 8, 1938, when Original Certificate of Title No. 6929 was issued to the spouses Dioniciano Nacalaban and Faustina Cababarros. This issuance constituted constructive notice to the private respondents. The Court cited Fermoso vs. Tutaan for the principle that the issuance of a title is constructive notice. Furthermore, the Court noted that even if the private respondents demanded partition in 1945 and were refused, the present action was filed only on February 11, 1964, which is more than ten (10) years from the accrual of the cause of action in 1938. The Court reiterated the settled rule that actions on implied and constructive trusts are extinguished by laches or prescription of ten years, as established in Varsity Hills, Inc. vs. Navarro.
Main Doctrine
An action for partition and reconveyance based on an implied or constructive trust prescribes ten (10) years from the issuance of the Torrens title, which serves as constructive notice to the claimants.