Alferez v. Canencia
REITERATIONFacts
The Antecedents: Federico J. Alferez died intestate on September 23, 1980, survived by his spouse, Teodora, and their children, Ma. Concepcion, Antonio, and Esperanza. Petitioners allege that Federico left bank debts, prompting Ma. Concepcion to file a petition for Letters of Administration for his estate. The estate included several parcels of land. On January 15, 1982, Teodora and the petitioners executed an Extrajudicial Settlement with Donation, wherein Teodora conveyed her conjugal shares of certain properties to her children. To settle Federico's debts, Ma. Concepcion, as administratrix, was authorized to sell properties adjudicated to the petitioners. Consequently, a Deed of Sale with Assumption of Mortgage was executed on October 8, 1985, with Spouses Exequiel and Celestina Canencia, Norma A. Alforque, and Teresa A. Alforque, covering the properties adjudicated to the petitioners. Procedural History: Petitioners filed an action for Annulment and/or Declaration of Nullity of the Deed of Sale with Assumption of Mortgage, asserting that the sale was intended only for Federico's share and not Teodora's conjugal portion. They claimed they were misled into signing a document that included the entire property. After a failed settlement attempt, a case was filed in 1995, dismissed for lack of jurisdiction, and refiled in 2007. The Regional Trial Court (RTC), Branch 19, Davao del Sur, rendered a judgment on May 17, 2016, declaring the Deed of Sale valid. Aggrieved, petitioners appealed to the Court of Appeals (CA). The CA, on June 29, 2018, declared the RTC's judgment void for lack of jurisdiction, citing Rule 73, Section 1 of the Rules of Court. Petitioners' motion for reconsideration was denied on January 16, 2019. The Petition: Petitioners filed a petition for review on certiorari under Rule 45 of the Rules of Court, assailing the CA's decision and resolution. They argue that the CA erred in dismissing the case on jurisdictional grounds instead of ruling on the merits. Petitioners contend that the CA confused jurisdiction with venue and that the RTC's judgment should not have been declared void. Furthermore, they maintain that the Deed of Sale with Assumption of Mortgage should be annulled as it did not reflect their true intent to sell only Federico's portion of the properties. They seek the reversal of the CA's decision and the reinstatement of the RTC's judgment, asserting the validity of the Deed of Sale.
Issue(s)
Whether the Court of Appeals erred in declaring the Regional Trial Court's judgment void for lack of jurisdiction. Whether the Deed of Sale with Assumption of Mortgage is valid only insofar as the one-half share of the estate of Federico is concerned.
Ruling
The Supreme Court ruled that the Court of Appeals erred in dismissing the Regional Trial Court's judgment for lack of jurisdiction. The Court reinstated the RTC's judgment, declaring the Deed of Sale with Assumption of Mortgage valid. The Court held that the issue raised by the CA was one of venue, not jurisdiction, and that the respondents had waived any objection to the venue by actively participating in the proceedings. Furthermore, the Court found that the Deed of Sale was absolute and did not contain any stipulations indicating an intent to sell only half of the property, and that the petitioners failed to prove any exceptions to the parol evidence rule to alter the terms of the written agreement.
Ratio Decidendi
On the issue of jurisdiction: The Supreme Court held that the Court of Appeals erred in declaring the Regional Trial Court's judgment void for lack of jurisdiction based on Section 1, Rule 73 of the Rules of Court. The Court clarified that Section 1, Rule 73, which states that the court first taking cognizance of the settlement of an estate shall exercise jurisdiction to the exclusion of all other courts, pertains to matters of venue, not jurisdiction. Jurisdiction over probate matters is conferred by law, such as Section 44(e) of R.A. No. 296 (Judiciary Act of 1948), which grants Courts of First Instance (now RTCs) original jurisdiction over all matters of probate, both testate and intestate. The Court emphasized that wrong venue is a procedural infirmity that can be waived, unlike a lack of jurisdiction, which cannot be waived and may be raised at any stage. In this case, the respondents did not object to the venue and actively participated in the proceedings before the RTC, thereby waiving any objection. Moreover, the Court noted that a probate court has limited jurisdiction and cannot adjudicate ownership of properties claimed by third parties under an adverse title, unless specific exceptions apply or the parties consent. The issue of ownership, which the RTC addressed, should be ventilated in a separate action, thus lending credence to the RTC's judgment on the merits rather than its dismissal for lack of jurisdiction. On the validity of the Deed of Sale with Assumption of Mortgage: The Supreme Court ruled in favor of the respondents, upholding the validity of the Deed of Sale. The Court reiterated the basic principle that a contract is the law between the parties and must be complied with in good faith, unless its stipulations are contrary to law, morals, good customs, public order, or public policy. A cursory examination of the Deed revealed that the petitioners, without qualification, sold, transferred, and conveyed the parcels of land to the respondents. There was no mention of an intention to sell only half of the property or any stipulation regarding Teodora's specific share. The Court applied Article 1370 of the Civil Code, which states that if the terms of a contract are clear and leave no doubt, the literal meaning shall control. The Deed was considered the best evidence of the parties' intention. The Court also invoked Section 9, Rule 130 of the Revised Rules of Court (parol evidence rule), which prohibits the introduction of evidence to contradict or modify the terms of a written agreement unless specific exceptions apply, such as an intrinsic ambiguity, mistake, or imperfection, or the failure of the agreement to express the true intent of the parties. The petitioners failed to present evidence to prove any of these exceptions, such as the alleged oral agreement that the Deed was merely a temporary security document or the existence of a Memorandum of Agreement. The Court concluded that the petitioners, as absolute owners of the subject parcels of land after the Extrajudicial Settlement with Donation, had the right to dispose of them, and their SPAs authorized Ma. Concepcion to sell their respective portions, thus validating the contract.
Main Doctrine
The Court of Appeals erred in dismissing the Regional Trial Court's judgment for lack of jurisdiction based on Section 1, Rule 73 of the Rules of Court, as this provision pertains to venue, not jurisdiction. Furthermore, a probate court, while having jurisdiction over the settlement of an estate, cannot adjudicate ownership of properties claimed by third parties under an adverse title, unless specific exceptions apply or the parties consent. The validity of a contract, such as a Deed of Sale, must be upheld based on its written terms unless exceptions to the parol evidence rule are proven.