David v. Perez
REITERATIONFacts
The Antecedents: David Pelayo (Pelayo) executed a Deed of Absolute Sale on January 11, 1988, conveying two parcels of agricultural land to Melki Perez (Perez). Pelayo's wife, Lorenza Pelayo (Lorenza), signed the deed as a witness on the third page. Perez's application for registration was denied because Lorenza did not sign on the first and second pages. Perez filed a complaint for specific performance against the Pelayos after Lorenza refused to sign the other pages. Procedural History: The Regional Trial Court (RTC) dismissed the complaint, finding the deed null and void. The Court of Appeals (CA) reversed the RTC decision, declaring the deed valid and enforceable, and ordered Lorenza to sign all pages. The CA denied the Pelayos' motion for reconsideration. The Pelayos then filed a petition for review on certiorari with the Supreme Court. The Petition: The Pelayos sought to reverse the CA decision, arguing that the deed was invalid due to non-compliance with R.A. No. 6657 (Comprehensive Agrarian Reform Law) regarding registration, lack of marital consent, being prohibited under Article 1491(2) of the Civil Code, and lack of consideration. They also argued that they should have been allowed to file their appellees' brief.
Issue(s)
Whether the Deed of Absolute Sale is null and void for non-compliance with the registration provision of R.A. No. 6657. Whether the deed is null and void for lack of marital consent. Whether the deed is null and void for being prohibited under Article 1491(2) of the Civil Code. Whether the deed is null and void for lack of consideration. Whether the Pelayos were denied due process by the CA's denial of their motion for reconsideration to file an appellees' brief.
Ruling
The petition is denied. The Decision of the Court of Appeals dated April 20, 1999, and its Resolution dated December 17, 1999, are affirmed.
Ratio Decidendi
On the issue of R.A. No. 6657 compliance: The Court held that the issue of whether the deed of sale was null and void under R.A. No. 6657 for failure to register within three months had already been resolved with finality by the CA in a prior decision dated November 24, 1994, which became final and executory. This prior ruling, interpreting Sections 4 and 70 of R.A. No. 6657, stated that the sale was not proscribed by the law and that the failure to register was not due to the respondent's fault. Applying the principle of the 'law of the case,' this prior ruling is binding on the parties and immutable. On the issue of marital consent: The Court affirmed the CA's ruling that Lorenza Pelayo gave implied consent to the sale by signing as a witness. Sale is a consensual contract perfected by consent, which can be express or implied. Lorenza's presence during the execution, her awareness of the family's problems related to the property, and her failure to file an annulment case for over three years despite demands, indicated her knowledge and consent. Moreover, under Articles 166 and 173 of the Civil Code, lack of marital consent renders the contract merely voidable, not void ab initio, and requires an action for annulment by the wife. On the issue of Article 1491(2) of the Civil Code: The Court found the argument that the deed was invalid under Article 1491(2) (prohibiting agents from acquiring property entrusted to them) unmeritorious. This prohibition is not absolute and does not apply if the principal consents. In this case, the Pelayos, by signing the deed of sale, are deemed to have given their consent, making the transaction an exception to the rule. On the issue of lack of consideration: The Court found that consideration was present. The deed itself acknowledged receipt of P10,000.00, and the Pelayos had authorized Perez to represent them in negotiations with illegal occupants, considering his services as part of the consideration. The argument that the consideration was inadequate was rejected, citing Buenaventura v. Court of Appeals, which held that courts cannot relieve parties from bad bargains or foolish acts unless there is a violation of law or an actionable wrong. The Pelayos, being represented by a lawyer, were presumed to have acted with knowledge and without fraud or undue influence. On the issue of due process and appellees' brief: The Court affirmed the CA's denial of the motion for reconsideration. The motion was filed out of time. Even setting aside the technicality, the motion did not present any grounds on the merits to justify a reversal. The Pelayos had the opportunity to present their defenses in the motion for reconsideration but failed to do so, thus not infringing their right to due process.
Main Doctrine
A wife's signature as a witness on a deed of sale, coupled with circumstances indicating her awareness of the transaction and the absence of any action to annul the contract for over three years, can be deemed as implied consent to the sale of conjugal property. Furthermore, the principle of 'law of the case' binds parties to prior unappealed rulings on issues within the same case.