Rodrigo v. Ancilla
REITERATIONFacts
The Antecedents: Lot 434, originally registered under OCT No. 428 in the names of Ramon Daomilas and Lucia Nagac (parents of respondent Sister Lucia Ancilla), was fraudulently transferred to Vicente Sauza, father-in-law of petitioner Severina Rodrigo. Vicente Sauza tricked the Daomilas spouses into signing a deed of transfer, misrepresented as a document evidencing their status as adjoining landowners. Vicente Sauza also executed an affidavit adjudicating the lot to himself. His subsequent motion for a transfer certificate of title was denied, and he refused to return OCT No. 428. Procedural History: After Vicente Sauza and his heirs died, petitioner Jose Fabriga, as Registrar of Deeds, cancelled OCT No. 428 and issued TCT No. T-3062 in the name of Vicente Sauza, allegedly with grave abuse of discretion and in connivance with petitioner Cruz Limbaring. Subsequently, petitioners Severina Rodrigo and the heirs of Felimon Sauza executed an extrajudicial settlement, transferring portions of Lot 434 to Severina Rodrigo (TCT No. T-5427) and petitioner Cruz Limbaring (TCT No. T-5426). Respondent Sister Lucia Ancilla, as heir of Ramon Daomilas, filed a complaint for reconveyance on December 28, 1979. The Regional Trial Court (RTC) ruled in favor of the respondent, ordering the reconveyance of Lot 434. The Court of Appeals affirmed the RTC decision in toto. The Petition: Petitioners assail the decision of the Court of Appeals, questioning whether the action for reconveyance should prosper.
Issue(s)
Whether the action for reconveyance filed by the respondent should prosper. Whether the issuance of TCT No. T-3062 in the name of the deceased Vicente Sauza was valid. Whether the subsequent transferees, Severina Rodrigo and Cruz Limbaring, were purchasers in good faith. Whether the action for reconveyance had prescribed.
Ruling
The petition is DENIED. The decision of the Court of Appeals dated March 30, 1999, is AFFIRMED.
Ratio Decidendi
On whether the action for reconveyance should prosper: The action for reconveyance should prosper because the property was acquired through fraud and mistake, creating an implied trust. The remedy of reconveyance is available to a landowner whose property has been wrongfully or erroneously registered in another's name, provided the property has not passed to an innocent third party for value. In this case, the original title (OCT No. 428) was obtained through fraudulent means by Vicente Sauza, who tricked the original owners into signing a deed of transfer. The subsequent transfer of title to Vicente Sauza's name was tainted with fraud and mistake, making the subsequent transfers to his heirs and petitioners Severina Rodrigo and Cruz Limbaring also void. On the validity of TCT No. T-3062: The issuance of TCT No. T-3062 in the name of the deceased Vicente Sauza was invalid. This issuance was done with grave abuse of discretion and in connivance with petitioner Cruz Limbaring. The cancellation of OCT No. 428 and the subsequent issuance of TCT No. T-3062 were precipitated and tainted with mistake and fraud. Consequently, any subsequent transfer or settlement of the property based on this invalid title, such as the extrajudicial settlement of Vicente Sauza's estate and the transfers to Severina Rodrigo and Cruz Limbaring, had no force and effect. On whether Severina Rodrigo and Cruz Limbaring were purchasers in good faith: Both Severina Rodrigo and Cruz Limbaring were in bad faith. Severina Rodrigo, as the widow of Vicente Sauza, could not claim ignorance of the trickery employed to obtain the original title and deed of transfer, nor could she be ignorant of the acts of Cruz Limbaring, who was known to be the counsel for her husband's heirs. For Cruz Limbaring, the finding of bad faith by the lower courts was given deference, as the question of good or bad faith is a factual matter. As a lawyer for the heirs, he induced the Registrar of Deeds to issue the fraudulent title, acting in bad faith to the prejudice of the original owners' heirs. On whether the action for reconveyance had prescribed: The action for reconveyance had not prescribed. An action for reconveyance based on an implied or constructive trust prescribes in 10 years. This period is reckoned from the date of issuance of the transfer certificate of title, which serves as constructive notice to the whole world. TCT No. T-3062 was issued on January 13, 1971. The respondent filed her suit for reconveyance on December 28, 1979, which was well within the 10-year prescriptive period. Therefore, prescription did not attach to the respondent's claim.
Main Doctrine
An action for reconveyance based on implied or constructive trust prescribes in 10 years, reckoned from the date of issuance of the transfer certificate of title which operates as constructive notice to the whole world. Transferees in bad faith cannot claim ignorance of the fraud or defect in title.