Dolar v. Barangay Lublub
REITERATIONFacts
The Antecedents: Petitioner Edgardo D. Dolar and Serafin Jaranilla co-owned a 4.6-hectare land. On September 16, 1981, they donated this land to respondent Barangay Lublub (now P.D. Monfort North) subject to conditions: (A) the area shall be used for public purposes within five years, designated as 'DON VENANCIO DOLAR PLAZA'; (B) failure to complete construction within five years shall render the deed void and ownership revert to donors; (C) conversion to other uses shall revoke the donation and revert ownership. The donation was accepted by the barangay captain. The barangay took possession and developed the property with government buildings and recreational facilities. The donation was not registered. On April 12, 1989, petitioner was issued a Transfer Certificate of Title (TCT) No. T-1298374 for the donated area. In June 1989, petitioner executed a second deed donating the same area to Barangay Lublub, with identical conditions. Subsequently, the mother lots were declared tax delinquent, and petitioner, as the highest bidder, acquired the property at an auction sale. Procedural History: On May 6, 1998, petitioner filed Civil Case No. 98-033 against Barangay Lublub and entities occupying portions of the land, seeking to quiet title and recover possession, alleging non-compliance with donation conditions. Barangay Lublub filed an Answer with Counterclaim and a Motion to Dismiss, arguing lack of cause of action or prescription, and asserting compliance with conditions and acquisition by prescription. Separately, Barangay Lublub filed Civil Case No. 00-140 against petitioner and others, seeking cancellation of title, reconveyance, and declaration of nullity of the tax delinquency notice, alleging collusion in the levy process. Petitioner moved to dismiss Civil Case No. 00-140 on grounds of forum shopping and litis pendentia. The two cases were consolidated. The Regional Trial Court (RTC), Branch 38, Iloilo City, in an Order dated January 3, 2002, dismissed Civil Case No. 98-033, finding the action barred by extinctive prescription under Article 764 in relation to Articles 733 and 1144(1) of the Civil Code. It denied petitioner's motion to dismiss in Civil Case No. 00-140, allowing it to proceed. Petitioner's motion for reconsideration was denied by an Order dated March 5, 2002. The Petition: Petitioner filed a petition for review on certiorari under Rule 45, seeking to annul the RTC orders. He raised issues concerning whether his action was for revocation or quieting of title, prescription, validity of acceptance, automatic reversion clause, and acquisitive prescription.
Issue(s)
Whether petitioner's action in Civil Case No. 98-033 is one for revocation of donation or for quieting of title, and whether either action has prescribed. Whether the deed of donation is valid due to defective acceptance or no longer effective due to the automatic reversion clause. Whether respondent barangay acquired the property by acquisitive prescription.
Ruling
The petition is denied for lack of merit. The dismissal of Civil Case No. 98-033 by the trial court is affirmed.
Ratio Decidendi
On the nature of the action and prescription: The Court held that petitioner's action in Civil Case No. 98-033, which sought to declare him the absolute owner, necessarily included the revocation of the deed of donation. The trial court correctly found that the action to revoke the donation had prescribed. The donation was executed on September 16, 1981, and the five-year period for development lapsed in September 1986. Under Article 764 of the Civil Code, the action for revocation prescribes after four years from non-compliance, meaning it should have been filed by September 1990. Even applying the general rule on prescription for actions upon a written contract under Article 1144 of the Civil Code, which provides a ten-year period, the action should have been filed by September 1996. Petitioner filed his complaint on May 6, 1998, which was beyond both prescriptive periods. Furthermore, an action to quiet title under Article 476 of the Civil Code is unavailing until the donation is first revoked in due course, and it generally requires the plaintiff to be in actual possession of the property, which petitioner was not. On the validity of acceptance and automatic reversion: The Court found that the issue of whether the barangay captain had sufficient authority to accept the donation was a disputed factual issue not proper for a petition for review on certiorari based on pure questions of law. However, even assuming the petitioner had standing to question the authority, the subsequent actions of the Sangguniang Barangay and the barangay residents, who enjoyed the benefits of the donation for over two decades, effectively ratified the acceptance. Regarding the automatic reversion clause, while a stipulation for automatic rescission is valid, judicial intervention is necessary to determine the propriety of the rescission when the donee denies or challenges it, as Barangay Lublub did. The Court noted that the barangay had substantially complied with the conditions by establishing public service infrastructures, costing millions, and petitioner's prolonged silence indicated satisfaction until the property was sold for taxes. On acquisitive prescription: The Court acknowledged that prescription generally does not run against registered land. However, it pointed out that Barangay Lublub anchored its claim on the deed of donation, not solely on prescription. Moreover, Civil Case No. 00-140 was filed precisely because of the dubious manner by which petitioner allegedly acquired his Torrens title over the property he had donated. The Court also clarified that registration of the deed of donation is not necessary for its validity and efficacy between the parties.
Main Doctrine
An action to revoke an onerous donation, even if stipulated with automatic reversion, requires judicial intervention to determine the propriety of the rescission when the donee denies or challenges it. The prescriptive period for such an action is governed by the general rules on prescription, not solely Article 764 of the Civil Code, and an action to quiet title is unavailing until the donation is effectively revoked.