Tayco v. Heirs of Tayco-Flores
REITERATIONFacts
1. The Antecedents: Upon the death of spouses Fortunato Tayco and Diega Regalado, their children, petitioner Francisco Tayco, Concepcion Tayco-Flores, and Consolacion Tayco, inherited three parcels of land located in Kalibo, Aklan. In September 1972, Francisco and Consolacion executed a Deed of Extrajudicial Settlement of the Estate of Diega Regalado with Confirmation of Sale of Shares, purportedly transferring their shares to Concepcion. Later, in March 1991, Concepcion and Consolacion executed a Confirmation of Quitclaim of Shares in Three Parcels of Land. Following the deaths of Concepcion and Consolacion, Francisco filed a case seeking to nullify these documents, asserting he was still entitled to his original shares in the properties. 2. Procedural History: The Regional Trial Court (RTC) of Kalibo, Aklan, ruled in favor of Francisco Tayco, declaring the Deed of Extrajudicial Settlement and the Confirmation of Quitclaim of Shares null and void, and ordering the properties to be co-owned by Francisco and the heirs of Concepcion. The RTC found the extrajudicial settlement to be a simulated document intended for mortgage purposes that did not materialize, rendering it void. The respondent-heirs appealed this decision to the Court of Appeals (CA). The CA reversed the RTC's ruling, declaring the defendants-appellants (heirs of Concepcion) as absolute owners of the properties and dismissing Francisco's complaint. The CA reasoned that the genuineness and due execution of the Extrajudicial Settlement were not disputed and that its recitals clearly indicated a settlement of the estate and confirmation of sale of shares. 3. The Petition: This case comes before the Supreme Court via a petition for review on certiorari under Rule 45 of the Rules of Court. The petitioner, Francisco Tayco, seeks to reverse the Court of Appeals' decision and reinstate the Regional Trial Court's ruling. The core issue raised is whether the Deed of Extrajudicial Settlement of the Estate of the Deceased Diega Regalado with Confirmation of Sale of Shares effectively divested co-heir and co-owner Francisco Tayco of his shares in the three parcels of land. The petitioner argues that the CA erred in disregarding the RTC's factual findings, particularly regarding the simulated nature of the documents and the lack of consideration and proper publication for the extrajudicial settlement.
Issue(s)
Whether the Deed of Extrajudicial Settlement of the Estate of the Deceased Diega Regalado with Confirmation of Sale of Shares can divest co-heir and co-owner Francisco Tayco of his shares in the three parcels of land. Whether the Court of Appeals erred in disregarding the factual findings of the trial court.
Ruling
The petition for review on certiorari is GRANTED. The Court of Appeals' Decision dated November 17, 2004 is REVERSED and SET ASIDE, and the Decision of the Regional Trial Court of Kalibo, Aklan, Branch 9, dated October 2, 2001, is UPHELD and REINSTATED.
Ratio Decidendi
On the issue of whether the Deed of Extrajudicial Settlement and Confirmation of Quitclaim could divest Francisco Tayco of his shares: The Supreme Court found merit in the petition, noting that the case falls under exceptions to the rule that it does not pass on questions of fact. The Court emphasized that the publication requirement under Section 1, Rule 74 of the Rules of Court is crucial for extrajudicial settlements to be binding on all persons. The trial court's findings regarding the lack of proof of publication and the questionable circumstances surrounding the notarization were given weight. Furthermore, the Court considered the trial court's finding that the Deed of Extrajudicial Settlement was simulated, intended only to facilitate a mortgage that did not materialize, and that the consideration of ₱50.00 for a 1/3 share of the property was grossly inadequate, suggesting a lack of genuine intent to sell. The Confirmation of Quitclaim was also deemed void as it was based on the invalidity of the first document and was executed without the participation of Francisco Tayco, despite his being a co-heir and co-owner. On the issue of whether the Court of Appeals erred in disregarding the factual findings of the trial court: The Supreme Court held that the CA erred in disregarding the factual findings of the RTC without substantial evidence. It is a well-established doctrine that the findings of fact of the trial court are entitled to great weight and should not be disturbed on appeal except for strong and valid reasons, as the trial court is in a better position to assess the evidence and the demeanor of witnesses. The CA's reversal was based on its own interpretation of the documents without adequately refuting the RTC's factual conclusions regarding the simulation, lack of publication, and gross inadequacy of consideration, which were critical in determining the validity of the documents.
Main Doctrine
The Supreme Court reversed the Court of Appeals, reinstating the Regional Trial Court's decision that declared the Deed of Extrajudicial Settlement and Confirmation of Quitclaim void due to lack of publication, simulated nature, and gross inadequacy of consideration, thereby upholding the co-ownership of the disputed properties.