Bautista-Borja v. Bautista
REITERATIONFacts
The Antecedents: Spouses Pablo and Segundina Bautista died intestate, leaving behind several agricultural lands. Pablo died in 1980 and Segundina in 1990. Pablo owned approximately 30 hectares in Ramon, Isabela, and 17 hectares in Llanera, Nueva Ecija. They had five children: respondents Iluminada and Aurea, and the deceased Francisco and Simplicio, and petitioner Natividad. Francisco was survived by six children, and Simplicio by five children, all of whom are respondents or related to respondents. The petitioner claims that the respondents fraudulently convinced her to cultivate these lands, which were to be partitioned, but unbeknownst to her, the titles were cancelled through purported Deeds of Sale executed by her parents in favor of her siblings Simplicio and Francisco. Procedural History: On June 9, 1994, petitioner Natividad Bautista-Borja filed a complaint before the Regional Trial Court (RTC) of Santiago City, Isabela, seeking the annulment of the Deeds of Sale and partition of the properties. She alleged that the deeds were forgeries or falsifications, or fictitious, as her parents were gravely ill and lacked understanding at the time of their alleged execution, and that no consideration was paid. The respondents filed a Motion to Dismiss, arguing lack of cause of action, prescription, and laches. The RTC dismissed the complaint, holding that the action, based on an implied trust, had prescribed under Articles 1456 and 1144 of the Civil Code, and that laches had also set in. Petitioner appealed to the Court of Appeals, arguing that her complaint was for annulment of void contracts, which is imprescriptible, and that laches did not apply. The Court of Appeals affirmed the RTC's ruling, citing Salvatierra v. Court of Appeals and holding that an action for reconveyance based on implied trust prescribes in ten years, and that petitioner was guilty of laches, or that the action should have been filed within four years from discovery of fraud. The Petition: Petitioner seeks review of the Court of Appeals' decision. She argues that her cause of action is for the annulment or declaration of inexistent contracts, making it imprescriptible under Article 1410 of the Civil Code. She further contends that even if an implied trust existed, her action is anchored on the annulment of a void contract. Petitioner also asserts that a resulting trust, not a constructive trust, was established, and that actions to recover property held in resulting trust are imprescriptible as long as the trustee has not repudiated the trust. She claims respondents' assurances that partition proceedings were ongoing indicate no repudiation of the trust. Petitioner also invokes Palmera v. CSC regarding laches, stating it does not apply when a defendant has promised to grant the relief sought. Finally, she submits affidavits from her sisters, respondents Iluminada and Aurea, averring that their parents were illiterate and could not have executed the deeds, and that they did not engage the services of the respondents' counsel.
Issue(s)
Whether the petitioner's cause of action for annulment of the Deeds of Sale has prescribed, considering arguments of voidness versus voidability. Whether the petitioner's cause of action, if considered as one for reconveyance, has prescribed, distinguishing between void and voidable contracts. Whether the motion to dismiss should be granted based on prescription or laches, considering the need for evidentiary determination.
Ruling
The petition is GRANTED. The Decision of the Court of Appeals is REVERSED and SET ASIDE. The case is REMANDED to the trial court for appropriate proceedings.
Ratio Decidendi
On the Issue of Prescription for Annulment of Void Contracts: The Court held that the petitioner's action is one for declaration of the nullity of the Deeds of Sale, which she claimed were either falsified or fictitious, and executed without consideration. Following Article 1410 of the Civil Code, an action for the declaration of the inexistence of a contract does not prescribe. Therefore, the petitioner's cause of action for annulment of these alleged void deeds of sale is imprescriptible. The Court emphasized that if the trial court finds the deed of sale to be void, the action for its declaration of nullity is imprescriptible, citing previous rulings that an action for reconveyance based on a void contract does not prescribe. However, if the deed is found to be merely voidable, the action would have prescribed. On the Issue of Prescription for Reconveyance based on Void Contract: Even if the petitioner's complaint were to be construed as one for reconveyance, the Court found that since it is based on an alleged void contract, it is just the same imprescriptible. The Court reiterated that an action for reconveyance of property based on a void contract does not prescribe. This is distinct from an action based on a voidable contract, which would be subject to prescription periods. On the Issue of Prescription and Laches in relation to Motion to Dismiss: The Court pointed out that an allegation of prescription can only be effectively used in a motion to dismiss when the complaint on its face clearly shows that the action has already prescribed. Otherwise, the issue of prescription involves evidentiary matters that require a full-blown trial on the merits and cannot be determined in a mere motion to dismiss. The Court found that the complaint, on its face, did not definitively indicate that the action had prescribed, thus warranting further proceedings.
Main Doctrine
An action for annulment of a void contract is imprescriptible. Even if the complaint is considered one for reconveyance based on an alleged void contract, it remains imprescriptible. However, if the contract is merely voidable, the action would have prescribed.