Binayug v. Ugaddan
REITERATIONFacts
The Antecedents: Gerardo Ugaddan was granted a Homestead Patent (No. V-6269) on January 12, 1951, leading to the issuance of Original Certificate of Title (OCT) No. P-311 in his name on March 5, 1951. On July 10, 1951, Gerardo, with the alleged consent of his wife Basilia Lacambra, sold the subject properties to Juan Binayug for P3,000.00. This resulted in the cancellation of OCT No. P-311 and the issuance of Transfer Certificate of Title (TCT) No. T-106394 in Juan's name. Juan was the father of petitioner Alejandro Binayug, and the properties passed to Alejandro and his wife, petitioner Ana Ugaddan Binayug. Procedural History: After Gerardo's death, his heirs (respondents) discovered the cancellation of the title. They filed a complaint on October 22, 1998, seeking the declaration of nullity of the title, annulment of the instrument, and declaration of ownership with damages. They alleged that the sale was prohibited under Commonwealth Act No. 141 (Public Land Act) and that the Absolute Deed of Sale dated July 10, 1951, was forged, specifically Basilia's thumbmark. The National Bureau of Investigation (NBI) report indicated that Basilia's thumbmark on the deed did not match her specimen. The Regional Trial Court (RTC) found the Absolute Deed of Sale null and void due to the lack of Basilia's marital consent and the violation of Section 118 of the Public Land Act, as the sale occurred within five years of the patent's issuance. However, the RTC recognized petitioners' good faith and ordered them to be paid P100,000.00 as recovery of the price. The RTC declared OCT No. P-311 subsisting and valid and ordered the cancellation of TCT No. T-106394. Petitioners' Motion for Reconsideration was denied. The Petition: Petitioners elevated the case directly to the Supreme Court, arguing that the RTC erred in applying Section 118 of the Public Land Act instead of Section 124.
Issue(s)
Whether the sale of the homestead property executed within five (5) years from the issuance of the patent is void. Whether the heirs of the original homesteader can file an action to nullify the sale. Whether the petitioners acquired ownership through acquisitive prescription.
Ruling
The Supreme Court denied the petition, affirming the Decision and Order of the RTC. The sale was declared null and void, OCT No. P-311 was declared subsisting and valid, and TCT No. T-106394 was ordered cancelled. Respondents were ordered to pay petitioners P100,000.00 as payment for the price of the lots.
Ratio Decidendi
On the issue of the void sale under Section 118 of the Public Land Act: The Court reiterated that Section 118 of the Public Land Act explicitly prohibits the encumbrance or alienation of lands acquired under free patent or homestead provisions within five years from the issuance of the patent, except in favor of the Government or legally constituted banking corporations. The sale in this case, executed on July 10, 1951, only six months after the patent was issued on January 12, 1951, clearly fell within this prohibitory period. Consequently, the Absolute Deed of Sale dated July 10, 1951, was void from its execution, producing no legal effect whatsoever. This void contract could not have transferred title from Gerardo to Juan, nor could it be the basis for the issuance of TCT No. T-106394. A void contract is not susceptible to ratification, and the action to declare its absolute nullity is imprescriptible. The Court found no merit in petitioners' contention that only the State can bring an action for violation of Section 118, citing jurisprudence that allows heirs to pursue such actions. On the issue of the heirs' right to file an action to nullify the sale: The Court affirmed that the heirs of the original homesteader can maintain an action to nullify a sale that violates Section 118 of the Public Land Act. Citing De los Santos v. Roman Catholic Church of Midsayap, the Court explained that public policy requires that heirs be not prevented from re-acquiring public land granted by law for their family's home and cultivation, as this right cannot be waived. Even if the immediate effect of nullification is the reversion of the property to the State, the purchaser's claim is reduced to the purchase price and interest. As against the vendor or his heirs, the purchaser is no more entitled to keep the land than any intruder. Therefore, the respondents, as heirs of Gerardo, were the proper parties to institute the action for annulment. On the issue of acquisitive prescription: The Court declined to rule on the issue of acquisitive prescription, as it involves questions of fact, such as the nature, duration, and circumstances of possession. The Court reiterated that it is not a trier of facts and that the petitioners' direct resort to the Supreme Court was allowed solely because they raised a pure question of law regarding the applicability of Sections 118 and 124 of the Public Land Act. The RTC's findings on possession were deemed insufficient to resolve the issue of prescription. Therefore, the Court could not take cognizance of this claim.
Main Doctrine
A sale of land acquired under a homestead patent within the five-year prohibitory period from the issuance of the patent is void ab initio, and the action to declare its nullity is imprescriptible. The heirs of the original homesteader can maintain an action to nullify such sale, even if the property would revert to the State, as it is in furtherance of the fundamental aim of the homestead law to preserve the land for the family.