Alinas v. Alinas
REITERATIONFacts
The Antecedents: Spouses Onesiforo and Rosario Alinas, who separated in 1982, left two lots with a bodega and a house in the care of Onesiforo's brother, Victor Alinas, and his wife Elena. The petitioners allege they entrusted the properties to the respondents with the understanding that rental income would be remitted to the Social Security System (SSS) and the Rural Bank of Oroquieta (RBO) to pay off loans secured by the properties. In 1993, the petitioners discovered that the titles to both lots had been transferred to the respondent spouses. Procedural History: The Regional Trial Court (RTC) ruled that the respondent spouses were the owners of Lot 896-B-9-A (with the bodega) but that Onesiforo's sale of Lot 896-B-9-B (with the house) was void due to his wife's lack of consent. The RTC ordered the petitioners to reimburse the respondents for the redemption price of Lot 896-B-9-B. Only the respondent spouses appealed to the Court of Appeals (CA), which affirmed the RTC's decision regarding Lot 896-B-9-A but modified the ruling on Lot 896-B-9-B, ordering Rosario Alinas to reimburse a portion of the redemption amount with interest. The CA denied the petitioners' motion for reconsideration. The Petition: The petitioners filed a Petition for Review on Certiorari under Rule 45 of the Rules of Court, seeking to reverse the CA's decision. They argued that the CA erred in disregarding testimony questioning the authenticity of signatures on certificates of title, in declaring the respondents owners of Lot 896-B-9-A, and in imposing reimbursement obligations without ordering an accounting of rentals. The Supreme Court modified the CA's decision, declaring Onesiforo's sale of Lot 896-B-9-B entirely void ab initio, ordering the petitioners to reimburse the respondents the redemption amount with specific interest rates, and directing the respondents to convey Lot 896-B-9-B back to the petitioners.
Issue(s)
Whether the action for recovery of possession and ownership constitutes a collateral attack on the certificates of title. Whether the Court of Appeals erred in affirming the RTC's ruling on the ownership of Lot 896-B-9-A. Whether the sale of Lot 896-B-9-B, a conjugal property, by petitioner Onesiforo alone, without the consent of his wife, is valid. Whether petitioners should be ordered to reimburse respondent spouses for the redemption price of Lot 896-B-9-B, and at what interest rate. Whether the reimbursement amount should be offset against rentals from the properties.
Ruling
The petition is partly granted. The Court modifies the Court of Appeals Decision, declaring respondent spouses owners of Lot 896-B-9-A. It declares Onesiforo's sale of Lot 896-B-9-B null and void ab initio. Petitioners are ordered to reimburse respondent spouses the redemption amount of P111,110.09 with interest at 6% per annum from the date of filing of the complaint until finality of the decision, and thereafter at 12% per annum until full payment. Respondent spouses are ordered to convey Lot 896-B-9-B to petitioners and vacate the premises within fifteen (15) days from finality of the Decision.
Ratio Decidendi
On the issue of collateral attack: The Court held that the petitioners' action for recovery of possession and ownership, based on the allegations in their complaint, constituted a collateral attack on the Transfer Certificate of Title (TCT) No. T-17394. Citing Section 48 of Presidential Decree No. 1529 and jurisprudence, the Court emphasized that a certificate of title cannot be altered, modified, or cancelled except in a direct proceeding. The present action, seeking to impugn the validity of the title through a claim of ownership, falls under the prohibition against collateral attack. Therefore, the challenge to the authenticity of the Registrar of Deeds' signature on the certificates of title was dismissed on this procedural ground. On the ownership of Lot 896-B-9-A: The Court clarified that it was the RTC, not the CA, which initially declared respondent spouses as owners of Lot 896-B-9-A. Since only the respondent spouses appealed to the CA, the issue of ownership over Lot 896-B-9-A was not raised before the appellate court. Consequently, the CA merely reiterated the RTC's ruling. The Court further noted that petitioners did not appeal the RTC's decision regarding Lot 896-B-9-A, thus they could no longer seek its reversal or modification. The Court also found no reversible error in the CA affirming the RTC's factual findings that petitioners failed to prove entrustment of the property or any agreement regarding rental remittances, which led to the foreclosure by RBO and subsequent sale to respondent spouses. On the validity of the sale of Lot 896-B-9-B: The Court found the CA's application of equity in sustaining the sale of Onesiforo's share of the conjugal property to be erroneous. Applying Article 124 of the Family Code, which governs property relations of spouses married before the Family Code's effectivity but whose sale occurred thereafter, the Court held that the disposition or encumbrance of conjugal property requires the written consent of both spouses or court authority. In the absence of such consent, the disposition is void ab initio. The Court found that respondent spouses were aware that Lot 896-B-9-B was conjugal property and that Onesiforo's disposition was without his wife's consent, as evidenced by the lack of Rosario's signature on the sale documents and the execution of multiple documents by Onesiforo. Therefore, the sale was declared entirely null and void. On the reimbursement of the redemption price and the applicable interest rate: The Court agreed with the CA that petitioners should reimburse respondent spouses for the redemption price paid for Lot 896-B-9-B, citing the principle of non-enrichment at another's expense. However, the Court modified the interest rate. Applying jurisprudence, the Court ruled that the redemption price, being a sum certain at the time of the filing of the complaint, shall earn 6% interest per annum from the date of filing until finality of the decision. After finality, the total amount shall earn 12% interest per annum until full satisfaction. On the set-off against rentals: The Court denied the petitioners' prayer to offset the reimbursement amount against rentals. Regarding Lot 896-B-9-A and the bodega, the Court affirmed that ownership had validly passed to respondent spouses, and any rentals earned after their acquisition rightfully belonged to them. For Lot 896-B-9-B and the house, the Court found no credible proof of rental value or necessary expenses incurred by the respondent spouses for repairs. Furthermore, compensation or set-off requires liquidated and demandable debts, which were not established for rentals or expenses in this case.
Main Doctrine
A sale of conjugal property by one spouse without the written consent of the other is void ab initio under Article 124 of the Family Code, and this nullity extends to the entire sale, including the portion pertaining to the consenting spouse. However, the spouse seeking to annul the sale must reimburse the buyer for the purchase price paid, applying principles of equity and non-enrichment.