Vera Cruz v. Calderon
REITERATIONFacts
The Antecedents: Lucy Calderon and Avelino Belisario, Jr. were married and acquired a parcel of land which was issued a Transfer Certificate of Title (TCT) in their names. They separated in 1981. On June 3, 1986, Avelino sold the subject property to Spouses Antonio and Lucy Vera Cruz, who registered the sale and obtained a new TCT in their names. Avelino died on November 20, 1993. Lucy Calderon discovered the sale and claimed her signature on the Deed of Absolute Sale was forged, and that the property was conjugal. She filed a complaint for annulment of the Deed of Sale and TCT against the Vera Cruz spouses. Procedural History: The Regional Trial Court (RTC) ruled in favor of Lucy Calderon, declaring the Deed of Absolute Sale null and void concerning her share, ordering the cancellation of the TCT and issuance of a new one reflecting her ½ undivided share, and awarding attorney's fees. The Court of Appeals (CA) affirmed the RTC's decision with modification, finding the Vera Cruz spouses to be purchasers in good faith and deleting the award of attorney's fees and costs. The CA declared the Deed of Sale null and void only insofar as Lucy Calderon's share was concerned and ordered the issuance of a new TCT reflecting the ½ undivided share of the Vera Cruz spouses and the other ½ for Lucy Calderon. The Petition: The Spouses Vera Cruz filed a petition for review on certiorari with the Supreme Court, assailing the CA's decision for holding that despite being buyers in good faith, they were only entitled to one-half of the property, while Lucy Calderon was entitled to the other half.
Issue(s)
Whether the Court of Appeals committed grave abuse of discretion amounting to lack or excess of jurisdiction in holding that petitioners, as buyers in good faith, are only entitled to one-half of the property; and whether the sale of conjugal property is valid. Whether the action for annulment filed by respondent Lucy Calderon was barred by prescription.
Ruling
The Supreme Court GRANTED the petition, ordered Civil Case No. B-4488 DISMISSED on the ground of prescription, and declared the Deed of Absolute Sale dated June 3, 1986, valid and binding in its entirety.
Ratio Decidendi
On the issue of good faith, validity of the sale, and the sale of conjugal property: The Court affirmed the Court of Appeals' finding that the petitioners, Spouses Vera Cruz, were purchasers in good faith and for value, having exercised due diligence. A person dealing with registered land may rely on the certificate of title. While Article 166 of the Civil Code requires the wife's consent for the alienation of conjugal real property, and Article 173 allows the wife to seek annulment within ten years and during the marriage, the action for annulment in this case was already barred by prescription. Consequently, the sale executed by Avelino, even if it involved conjugal property, became valid and binding in its entirety as against the respondent due to her failure to timely file the action for annulment. The Court cited Heirs of Ignacia Aguilar-Reyes v. Spouses Mijares and Heirs of Christina Ayuste v. Court of Appeals to support the principle that the husband's alienation of conjugal property is voidable and subject to annulment within a specific period and condition, which was not met by the respondent. On the issue of prescription of the action for annulment: The Court held that the action for annulment of a contract entered into by the husband without the wife's consent must be filed during the marriage and within ten years from the transaction. In this case, the deed of sale was executed on June 3, 1986. Respondent Lucy Calderon filed her complaint for annulment on July 8, 1994. While this was within the ten-year period from the transaction, the marriage between her and Avelino Belisario, Jr. had already been dissolved by the death of Avelino on November 20, 1993. Therefore, the marriage was no longer subsisting at the time the complaint was filed, rendering the action barred by prescription. The Court reiterated that actions prescribe by the mere lapse of time fixed by law, and the registration of the deed of sale by Avelino in favor of the petitioners served as constructive notice to the respondent, causing the prescriptive period to run against her.
Main Doctrine
The action for annulment of a sale of conjugal property by the husband without the wife's consent prescribes if not filed during the marriage and within ten years from the transaction, even if the wife only learned of the sale after the husband's death, as registration of the sale constitutes constructive notice.