Bacalso v. Aca-Ac
REITERATIONFacts
The Antecedents: The Bacus siblings were registered owners of a parcel of land. On October 15, 1987, they executed a Deed of Absolute Sale conveying a portion of this land (Lot No. 1809-G-2-C) to their cousin, Timoteo Bacalso, for P8,000.00. Procedural History: Timoteo and others previously filed a complaint claiming co-ownership over a larger portion of the land, which was dismissed. Subsequently, Timoteo and Diosdada Bacalso filed a complaint for declaration of nullity of contract and reconveyance, claiming ownership of Lot No. 1809-G-2-C by virtue of the October 15, 1987 Deed of Absolute Sale, alleging the Bacus siblings reneged on their promise to issue a new title. They also alleged that the Bacus siblings subsequently sold the same lot to Evelyn Sychangco. The Bacus siblings denied the allegations, claiming the sale did not push through due to non-payment. Sychangco claimed to be a buyer in good faith. The Regional Trial Court (RTC) declared the Deed of Absolute Sale void for want of consideration and ruled that Sychangco, as a buyer in good faith, had a better right. The Court of Appeals (CA) affirmed the RTC ruling. The Petition: Petitioners sought review of the CA decision, arguing that the CA erred in disregarding their evidence and ruling that the Deed of Absolute Sale was void for want of consideration, and that it was a notarized public document enjoying a presumption of regularity. They also argued that the Bacus siblings were no longer owners when they executed the sale.
Issue(s)
Whether the Court of Appeals erred in ruling that the Deed of Absolute Sale dated October 15, 1987, is null and void ab initio for failure or want of consideration. Whether the Court of Appeals erred in relying on the oral testimonies of respondents Julian Bacus and Evelyn Sychangco over the testimonies of petitioner Timoteo Bacalso and his witness, and the documentary evidence. Whether the Court of Appeals erred in not considering that the Deed of Absolute Sale dated October 15, 1987, was notarized, hence a public document enjoying the presumption of regularity. Whether the Court of Appeals erred in not ruling that on October 15, 1987, the Bacus siblings were no longer owners and possessors of the subject lot as the same was already transferred to the petitioners by reason of the mere execution of a deed of sale in a public document.
Ruling
The petition is bereft of merit. The Decision dated December 14, 2005, of the Court of Appeals in CA-G.R. CV No. 67516 is affirmed.
Ratio Decidendi
On the issue of whether the Deed of Absolute Sale dated October 15, 1987, is null and void ab initio for failure or want of consideration: The Court held that the central issue involves a question of fact, and generally, only questions of law may be brought before the Supreme Court via certiorari. The findings of fact of the RTC, affirmed by the CA, are final and conclusive. The Court found no reason to disturb these findings. Under Article 1318 of the Civil Code, a contract requires consent, object, and cause. The RTC found, and the CA affirmed, that there was a failure or want of consideration for the Deed of Absolute Sale because the petitioner failed to pay the stipulated purchase price of P8,000.00. The testimony of Julian Bacus indicated that Timoteo Bacalso promised payment but failed to deliver, and instead, Timoteo and others filed a case claiming ownership of the land. Timoteo's own admissions during cross-examination further supported the conclusion that payment was not made, such as not obtaining a receipt, the payment not being made in the presence of the notary, Julian appearing before the notary without a special power of attorney from his sisters, Timoteo suppressing the deed in a prior case, and his failure to take steps to register the sale or declare the property for taxation. The Court emphasized that this is not merely a case of failure to pay, which would constitute a breach of obligation, but a case of want of consideration, which renders the contract void ab initio. Article 1352 of the Civil Code explicitly states that contracts without cause produce no effect whatsoever. Therefore, the sale could not be given effect, and the petitioners did not become absolute owners of the property. On the issue of whether the Court of Appeals erred in relying on the oral testimonies of respondents over the petitioners' evidence: The Court reiterated that it is not necessitated to re-evaluate evidence, especially when the findings of the trial court are affirmed by the appellate court. The RTC and CA gave credence to the testimonies of Julian Bacus and Evelyn Sychangco, and found the admissions of Timoteo Bacalso to be significant. The petitioners' claim that the Deed of Absolute Sale, being notarized, enjoys a presumption of regularity was not given weight in light of the evidence showing a want of consideration. The Court found that the petitioners failed to establish by preponderant evidence that the consideration was indeed paid. The circumstances surrounding the execution of the deed and the subsequent actions of Timoteo Bacalso cast serious doubt on the validity of the transaction, leading the lower courts to conclude that the sale was void for lack of consideration. On the issue of whether the Deed of Absolute Sale, being notarized, enjoys the presumption of regularity: While a notarized document enjoys the presumption of regularity, this presumption is not absolute and can be overcome by clear and convincing evidence to the contrary. In this case, the RTC and CA found sufficient evidence to rebut this presumption, particularly the admissions of Timoteo Bacalso and the testimony of Julian Bacus, which demonstrated the absence of consideration. The Court held that the lack of payment of the stipulated price rendered the deed void ab initio, irrespective of its notarization. The presumption of regularity does not validate a contract that is fundamentally flawed due to the absence of an essential element like cause or consideration. On the issue of whether the Bacus siblings were no longer owners on October 15, 1987: The Court found that the Bacus siblings remained the registered owners of the property at the time of the execution of the Deed of Absolute Sale. The argument that the mere execution of a public document transfers ownership was rejected because the deed itself was subsequently found to be void for want of consideration. If the contract of sale is void ab initio, it produces no legal effect, and thus, no transfer of ownership occurred. The subsequent sale by the Bacus siblings to Evelyn Sychangco was upheld by the lower courts on the ground that she was a buyer in good faith and for value, and the petitioners failed to establish their ownership over the property due to the void deed.
Main Doctrine
A deed of sale is void ab initio for want of consideration if the purchase price stipulated therein was never paid. Failure to pay the consideration is different from lack of consideration; the former results in a breach of obligation, while the latter prevents the existence of a valid contract.