Adille v. Court of Appeals
REITERATIONFacts
The Antecedents: Felisa Alzul owned Lot 14694. She sold it in pacto de retro in 1939, with a three-year redemption period. Felisa died in 1942 without redeeming the property. During the redemption period, her son from her first marriage, Rustico Adille (petitioner), repurchased the property alone. He then executed an extrajudicial partition, representing himself as the sole heir, and secured a title in his name in 1955, transferring OCT No. 21137 from his mother's name to his own. Procedural History: The private respondents, Felisa's children from her second marriage, filed a case for partition with accounting, alleging that Rustico acted as a trustee when he redeemed the property. The trial court dismissed the case, ruling that Rustico was the absolute owner. The Court of Appeals reversed the trial court's decision, ruling in favor of the private respondents. The Petition: Rustico Adille filed a petition for certiorari, questioning the Court of Appeals' decision, essentially arguing that he became the absolute owner due to his sole redemption of the property and the subsequent registration in his name.
Issue(s)
Whether a co-owner who redeems the entire property held in common can acquire exclusive ownership over it. Whether the registration of the property solely in the name of one co-owner terminates the co-ownership. Whether prescription bars the claim of the other co-owners, considering the property was registered in 1955 and the claim was filed in 1974. Whether fraud attended the registration of the property in the name of the petitioner.
Ruling
The petition is denied, and the decision of the Court of Appeals is affirmed in toto. The property remains under co-ownership, and the petitioner is liable to reimburse the private respondents for their shares in the redemption expenses.
Ratio Decidendi
On whether a co-owner who redeems the entire property held in common can acquire exclusive ownership over it: The Supreme Court held that the right of repurchase may be exercised by a co-owner with respect to his share alone. While the petitioner redeemed the property in its entirety and shouldered the expenses, this did not make him the owner of all of it, nor did it terminate the existing state of co-ownership. Necessary expenses incurred by one co-owner are subject to reimbursement from the other co-owners, as provided by Article 488 of the Civil Code. The redemption by one co-owner of the property in its totality does not vest in him ownership over it; it does not provide a mode of terminating a co-ownership. The vendee a retro may retain the property and consolidate title if all co-owners fail to redeem, but this does not grant the redeeming co-owner the right to the entire property. On whether the registration of the property solely in the name of one co-owner terminates the co-ownership: The Court ruled that the registration of the property in the petitioner's name did not terminate the existing co-ownership. Registration under the Torrens system operates as a mere notice of existing title, not as a means of acquiring ownership. While registration is constructive notice of title, it does not furnish a shield for fraud. Therefore, the act of registration, even if it were considered a repudiation, did not terminate the co-ownership, especially when fraud was involved. On whether prescription bars the claim of the other co-owners: The Court held that prescription did not bar the private respondents' claims. For prescription to terminate a co-ownership, there must be a clear repudiation of the co-ownership made known to the other co-owners, coupled with open, continuous, exclusive, and notorious possession for the period required by law. The petitioner failed to comply with these requisites. He concealed his actions by feigning sole heirship, thus failing to make known any repudiation. Furthermore, the period for prescription for actions to enforce a constructive trust is ten years from registration, but this period does not commence when the registration is tainted with fraud. The Court found that the private respondents discovered the fraud only during the litigation, making their claim timely. On whether fraud attended the registration of the property: The Supreme Court agreed with the Court of Appeals that fraud attended the registration. The petitioner's act of executing an affidavit of extrajudicial settlement representing himself as the sole heir was a clear effort to defraud his half-siblings and exercise sole dominion over the property. This act brought the case within the purview of Article 1456 of the Civil Code, which considers the person acquiring property through mistake or fraud as a trustee for the benefit of the person from whom the property comes. The petitioner's pretension of sole heirship constituted fraud, making him a trustee of an implied trust for the benefit of the private respondents.
Main Doctrine
A co-owner who redeems the entire property held in common does not acquire exclusive ownership; the property remains under co-ownership, and the redeeming co-owner is entitled to reimbursement from the other co-owners. Fraudulent registration of the property solely in the name of one co-owner does not terminate the co-ownership, and prescription does not run against the other co-owners until they discover the fraud.