Aleligay v. Laserna
REITERATIONFacts
1. The Antecedents: The underlying dispute concerns a 124,554 square meter parcel of land in Capiz, originally owned by Anselmo Aleligay, which passed to his six heirs upon his death in 1927. The petitioner, Eliodoro Aleligay, claimed he mortgaged the land in 1946 to respondent Teodorico Laserna but retained possession. He later discovered a deed of sale in Laserna's favor, which he alleged bore a forged signature, rendering Laserna's subsequent sale of the land to respondents Priscilla and Angustia Villagracia void. Laserna, however, asserted he purchased the property with a co-buyer in 1946 and later acquired the co-buyer's share, possessing the land since then. The Villagracias claimed to have bought the land in good faith from Laserna in 1969 and obtained title. 2. Procedural History: Eliodoro Aleligay filed a complaint for annulment of the deed of sale, damages, recovery of ownership, and reconveyance. The Regional Trial Court (RTC) of Roxas City dismissed his complaint, declaring the Villagracias owners of the land and ordering Eliodoro to vacate and pay damages and litigation expenses. While the case was on appeal, Eliodoro died and was substituted by his son, Ceferino Aleligay. The Court of Appeals affirmed the RTC's decision, upholding the validity of the sale between Laserna and the Villagracias. 3. The Petition: This petition for review on certiorari assails the Court of Appeals' decision and resolution. The petitioner raises two main issues: (1) whether the contract between respondent Laserna and Eliodoro Aleligay was an equitable mortgage and not a sale, and (2) whether respondents Priscilla and Angustia Villagracia were buyers in good faith. The petitioner argues that his continued possession of the land since 1946 indicates ownership and that the deed of sale was intended as an equitable mortgage. The respondents maintain their ownership and possession, supported by evidence including the notarized deed of sale, NBI fingerprint analysis confirming signatures, a joint affidavit attesting to Laserna's possession, a lease contract, and tax declarations. The Supreme Court is asked to determine the true nature of the 1946 transaction and the good faith of the Villagracias.
Issue(s)
Whether the Deed of Sale dated July 21, 1946, executed by the heirs of Aleligay and respondent Laserna, was an equitable mortgage and not a sale. Whether respondents Priscilla and Angustia Villagracia were buyers in good faith.
Ruling
The petition is DENIED for lack of merit. The assailed Decision and Resolution of the Court of Appeals are AFFIRMED.
Ratio Decidendi
On the issue of whether the Deed of Sale was an equitable mortgage: The Court affirmed the findings of the RTC and the Court of Appeals that the questioned deed of sale was indeed a contract of sale and not an equitable mortgage. The burden of proof lies with the plaintiff to establish by a preponderance of evidence that the contract is an equitable mortgage, as per the principle of actori incumbit onus probandi. Eliodoro failed to substantiate his claim of continued possession and ownership. The Court found no circumstances enumerated under Article 1602 of the Civil Code that would classify the transaction as an equitable mortgage. The notarized deed of sale carries evidentiary weight. Furthermore, the Dactyloscopic Report from the NBI confirmed the genuineness of Eliodoro's signature and the fingerprints of other heirs on the deed. A joint affidavit by adjoining owners attested to Laserna's continuous possession, corroborated by a lease contract granted by Laserna. Payment of realty taxes by the respondents also bolstered their claim. On the issue of whether respondents Villagracias were buyers in good faith: The Court held that good faith is presumed unless convincing evidence to the contrary is adduced. Eliodoro failed to present such contrary proof, thus the presumption of good faith in favor of the Villagracias stands. The Court considered this issue a non-issue, raised mainly to bolster Eliodoro's weak contention, as the primary issue of the nature of the sale had already been resolved.
Main Doctrine
The burden of proof lies with the plaintiff to establish by preponderance of evidence that a contract of sale is an equitable mortgage. In the absence of any circumstance enumerated under Article 1602 of the Civil Code, and with substantial evidence proving the contrary, a deed of sale shall be upheld as a contract of sale, not an equitable mortgage. Good faith in a transaction is presumed unless proven otherwise.