Galvez v. Court of Appeals
REITERATIONFacts
The Antecedents: Timotea F. Galvez died intestate in 1965, leaving a parcel of land. She was survived by her daughter, Paz Galvez, and a grandson, Porfirio Galvez (son of her predeceased son, Ulpiano). By right of representation, both Paz and Porfirio were entitled to inherit the property as co-heirs. However, Paz Galvez executed an Affidavit of Adjudication in 1970, claiming sole ownership of the property. Subsequently, she sold the property to Carlos Tam in 1992, who then registered it and later sold it to Tycoon Properties, Inc. Porfirio Galvez discovered these transactions and initiated legal action. Procedural History: Porfirio Galvez filed a civil case for Legal Redemption with Damages and Cancellation of Documents against Paz Galvez and Carlos Tam, later impleading Tycoon Properties, Inc. The Regional Trial Court (RTC) ruled in favor of Porfirio, declaring the Affidavit of Adjudication and the subsequent sales void, ordering the cancellation of titles, and reconveying the property to Porfirio. The RTC also awarded damages and attorney's fees. The petitioners (Paz Galvez, Carlos Tam, and Tycoon Properties, Inc.) appealed to the Court of Appeals, which affirmed the RTC's decision. A motion for reconsideration was subsequently denied. The Petition: The petitioners are before the Supreme Court via a Petition for Review on Certiorari under Rule 45 of the Rules of Court. They argue that Porfirio Galvez's claim is barred by prescription and laches, asserting that an implied trust was repudiated by Paz Galvez's Affidavit of Adjudication in 1970, and that Carlos Tam and Tycoon Properties, Inc. are buyers in good faith. The petitioners contend that the ten-year prescriptive period for an implied trust began in 1970, and that the action filed in 1994 was therefore too late. They also argue that the nullification of the sale should only apply to Porfirio's share, not Paz's.
Issue(s)
Whether the respondent's claim over the subject property, based on an implied trust, has prescribed; and whether the respondent's claim is barred by laches. Whether petitioners Carlos Tam and Tycoon Properties, Inc. are buyers in good faith and for value. Whether the nullification of the sale should extend only to the share of Porfirio Galvez; and whether Porfirio Galvez was properly notified of the sale, triggering his right of legal redemption.
Ruling
The petition is denied. The decision of the Court of Appeals is affirmed.
Ratio Decidendi
On the issue of prescription and laches concerning implied trust: The Court held that the case is governed by the rules on co-ownership, as both Paz Galvez and Porfirio Galvez were co-owners of the disputed property by inheritance. A co-owner cannot acquire the share of another co-owner by prescription unless there is clear repudiation of the co-ownership, which must be clearly made known to the other co-owners with clear and conclusive evidence, followed by open, continuous, exclusive, and notorious possession for the statutory period. The execution of the Affidavit of Self-Adjudication by Paz Galvez, while an act of claiming sole ownership, was not considered a clear and evident repudiation sufficient to exclude Porfirio Galvez. The Court reiterated that acts which may be considered adverse to strangers may not be considered adverse to co-owners. Furthermore, the Court clarified that an action for reconveyance based on implied or constructive trust prescribes in ten years, and this period is counted from the date of registration of the title. In this case, Carlos Tam obtained his title on January 21, 1994, and Porfirio Galvez filed his complaint on May 12, 1994, which was well within the ten-year period. Laches, being an equitable remedy, cannot be used to defeat justice or perpetrate fraud. On the issue of buyers in good faith: The Court found the claim of petitioners Carlos Tam and Tycoon Properties, Inc. as buyers in good faith to be unpersuasive. Both the trial and appellate courts found that Carlos Tam did not exert sufficient efforts to determine the previous ownership of the property and relied solely on the tax declarations in Paz Galvez's name. Moreover, Carlos Tam sold the property to Tycoon Properties, Inc. only five days after receiving a copy of the summons and complaint, despite being an owner of Tycoon Properties, Inc. The subsequent mortgage by Tycoon Properties, Inc. despite a notice of lis pendens further negated their claim of good faith. On the issue of the extent of nullification of the sale and the right of legal redemption: The Court affirmed the trial court's ruling that the entire property should be reconveyed to Porfirio Galvez. Porfirio Galvez's complaint sought legal redemption and reconveyance of his share, and subrogation to Paz Galvez's share after reimbursement. The Court noted that the mandatory written notice required under Article 1623 of the Civil Code for legal redemption was not given by Paz Galvez to Porfirio Galvez. Therefore, the right to redeem commenced when Porfirio Galvez filed his complaint. The trial court correctly ordered the reconveyance of the whole property to Porfirio Galvez, as one-half belonged to him by inheritance and the other half was redeemed by him from Carlos Tam.
Main Doctrine
The execution of an affidavit of self-adjudication by a co-owner does not constitute a clear and evident repudiation of co-ownership sufficient to exclude another co-owner. The prescriptive period for an action for reconveyance based on implied or constructive trust begins from the date of registration of title, and the right of legal redemption is not barred by prescription if the mandatory written notice to co-owners was not given.