Ong Ching Po, Yu Siok Lian, David Ong and Jimmy Ong v. Court of Appeals and Soledad Parian
REITERATIONFacts
The Antecedents: On July 23, 1947, Ong Joi Jong sold a parcel of land with a building thereon to private respondent Soledad Parian, evidenced by a notarized Deed of Sale. The title was registered in the name of private respondent. Private respondent entrusted the administration of the property to petitioner Ong Ching Po when she and her husband settled in Iloilo. After her husband's death, private respondent demanded the property be vacated for sale, but petitioners refused. Procedural History: Private respondent filed an unlawful detainer case, which was dismissed by the Metropolitan Trial Court, affirmed by the Regional Trial Court, and subsequently affirmed by the Court of Appeals. Petitioners, on the other hand, claimed that Ong Ching Po bought the same property on July 23, 1946, evidenced by a Deed of Sale in Chinese (Exh. "B"). This deed contained an addendum stating that Ong Joi Jong acceded to signing another document in favor of Soledad Parian to facilitate registration because Ong Ching Po was not yet a Filipino citizen, and that the title would be transferred later. On December 6, 1983, Ong Ching Po sold the property to his children, Jimmy and David Ong. Subsequently, Ong Ching Po and his children filed an action for reconveyance and damages against private respondent. Later, private respondent filed an action for quieting of title against Ong Ching Po and his wife, Yu Siok Lian. The two cases were consolidated, and the Regional Trial Court rendered a decision in favor of private respondent, which was affirmed by the Court of Appeals. The Petition: Petitioners seek review of the Court of Appeals' decision, arguing that it erred in giving full faith to the deed of sale in favor of private respondent over the deed in favor of Ong Ching Po, in concluding that petitioners' acts were not acts of ownership, and in ruling that no express or implied trust existed.
Issue(s)
Whether the Court of Appeals erred in giving full faith and credit to the Deed of Sale in favor of private respondent instead of the Deed of Sale in favor of petitioner Ong Ching Po, considering the validity of both deeds. Whether the acts of petitioners were acts of ownership, and whether such acts establish a claim superior to the private respondent's deed. Whether an express or implied trust existed between petitioners and private respondent, and whether evidence supports such a trust.
Ruling
The petition is DISMISSED. The Court affirmed the decision of the Court of Appeals, upholding the validity of the sale to private respondent and dismissing petitioners' claims.
Ratio Decidendi
On the validity of the Deeds of Sale: The Court held that even assuming Exhibit "B" (Deed of Sale in favor of Ong Ching Po) was genuine, it would be null and void because petitioner Ong Ching Po, being a Chinese citizen, was disqualified from acquiring and owning real property in the Philippines. The Court emphasized that sustaining the claim that private respondent was merely a dummy would give a premium to a violation of nationalization laws. The Court also found that the Deed of Sale in favor of private respondent was a notarized document, which enjoys the mantle of validity. Petitioners' claim that private respondent admitted no payment was refuted by the fact that the sale was likely financed out of conjugal funds. The Court clarified that possession is transferred by virtue of a notarized deed of conveyance. On the acts of ownership: The Court of Appeals observed that the acts of petitioners, such as paying taxes and collecting rentals, were not necessarily reflective of dominion, as even a mere administrator could perform them. The tax and rental receipts were also in the names of private respondent and her husband. The Court of Appeals did not give credence to Exhibit "B" and its translation because they had not been properly authenticated. The required order of proof for secondary evidence (existence, execution, loss, contents) was not followed, and the testimony of Yu Siok Lian regarding its execution was rejected by the trial court. On the existence of an express or implied trust: The Court found no document showing an express trust, as private respondent was not a party to Exhibit "B". Oral testimony to prove an express trust concerning immovable property is inadmissible under Article 1443 of the Civil Code. Regarding implied trusts, while they may be proven orally under Article 1457 of the Civil Code, the evidence must be trustworthy and received with extreme caution. The Court found no trustworthy evidence to establish an implied trust, noting that petitioners did not claim Ong Yee (private respondent's husband) lacked the financial capacity to acquire the land and improvements, and Yu Siok Lian admitted Ong Yee was a businessman.
Main Doctrine
A deed of sale executed in favor of an alien, who is disqualified from owning real property in the Philippines, is null and void. Such a transaction cannot be sustained even if it was intended to facilitate the registration of title and avoid legal complications, as it would give a premium to a violation of nationalization laws. Furthermore, the validity of a notarized deed of sale in favor of a qualified individual cannot be overcome by claims of an alleged express or implied trust, especially when such claims are not supported by sufficient and trustworthy evidence.