Cesa v. Brucelas
REITERATIONFacts
The Antecedents: Consolacion Montano, wife of Andres Montano, was a registered owner of Lot No. 1799. After Andres' death, Lot No. 1799 was partitioned, with Consolacion acquiring one-half and her daughters Elisa and Consuelo acquiring the other half in equal portions. Procedural History: Spouses Cesa filed a Complaint for Annulment/Rescission of Contract, Cancellation of Title, and Specific Performance with Damages against Spouses Brucelas (Elisa and David) and Spouses Del Rosario. The Regional Trial Court (RTC) ruled in favor of Spouses Cesa, declaring the sale to Spouses Del Rosario void. The Court of Appeals (CA) reversed the RTC, holding that Spouses Cesa failed to prove their purchase and that no double sale occurred. Spouses Cesa appealed to the Supreme Court. The Petition: Spouses Cesa, through their heirs, filed a Petition for Review on Certiorari assailing the CA's Decision and Resolution. They argued that the CA erred in holding that the 1985 Deed of Absolute Sale (DOAS) was not proof of a perfected sale and that no double sale occurred. They contended that they had a perfected contract of sale with Consolacion, Elisa, and Consuelo, and that Spouses Del Rosario were purchasers in bad faith.
Issue(s)
Whether the Court of Appeals committed a reversible error in holding that the 1985 Deed of Absolute Sale cannot be considered as proof of a perfected contract of sale between Spouses Cesa, on one hand, and Consolacion, Elisa, and Consuelo, on the other. Whether the Court of Appeals erred in concluding that no double sale took place in the case; that as only one sale of Lot No. 1799 transpired, i.e., from Consuelo and Spouses Brucelas to Spouses Del Rosario, it was immaterial whether the latter was in good faith in purchasing the subject property.
Ruling
The Petition for Review on Certiorari is GRANTED. The Decision dated October 10, 2019, and the Resolution dated February 1, 2021, of the Court of Appeals in CA-G.R. CV No. 106245 are REVERSED and SET ASIDE. The July 13, 2015 Decision of Branch 23, Regional Trial Court of Trece Martires City in Civil Case No. TMCV-052-10 is REINSTATED with MODIFICATIONS. The sale of the subject property by Spouses David Brucelas and Elisa Montano Brucelas to Spouses Raymundo A. Del Rosario and Nelia Del Rosario is DECLARED NULL and VOID. The Registry of Deeds of the Province of Cavite is ORDERED to CANCEL Transfer Certificate of Title No. T-1019104. The Deed of Absolute Sale dated June 17, 2002, executed by Spouses David Brucelas and Elisa Montano Brucelas in favor of Spouses Raymundo A. Del Rosario and Nelia Del Rosario, is DECLARED NULL and VOID. Spouses David Brucelas and Elisa Montano Brucelas and Spouses Raymundo A. Del Rosario and Nelia Del Rosario are ORDERED to PAY Spouses Angel Cesa and Feliciana Cesa, as substituted by their heirs, PHP 200,000.00 as attorney's fees, PHP 50,000.00 as exemplary damages, and PHP 50,000.00 as moral damages. All amounts due shall be proceeded against the estate of Elisa Montano Brucelas and against Spouses Raymundo A. Del Rosario and Nelia Del Rosario, and shall earn legal interest at the rate of 6% per annum from the finality of the Decision.
Ratio Decidendi
On the issue of whether the 1985 Deed of Absolute Sale (DOAS) is proof of a perfected contract of sale: The Court held that the 1985 DOAS, though unnotarized and bearing the signature of Apolonia Montano for her deceased brother Andres, was indicative of a perfected contract of sale. The Court reasoned that Andres' heirs, Consolacion, Elisa, and Consuelo, acquired ownership through succession after his death. Therefore, their subsequent sale of their respective shares to Spouses Cesa via the 1985 DOAS was legally valid, and Andres' signature was not needed, making Apolonia's signature surplusage. The Court further emphasized that the actions and inactions of the parties, including Spouses Cesa's immediate possession of Lot No. 1799 in the concept of an owner, payment of real property taxes, and construction of structures, coupled with the sellers' failure to question these acts, demonstrated a perfected and consummated sale, aligning with the principles in Estate of Bueno v. Estate of Atty. Peralta and Heirs of Simplicia Santiago v. Heirs of Mariano E. Santiago. The testimony of David Jr. that Spouses Cesa bought a different lot was considered hearsay and uncorroborated. On the issue of whether there was a double sale and the good faith of Spouses Del Rosario: The Court ruled that a double sale did occur, with the first sale being to Spouses Cesa in 1985 and the second to Spouses Del Rosario in 2002. While Spouses Del Rosario registered the property first, the Court found they were not purchasers in good faith. The RTC correctly pointed out that Spouses Cesa were in possession of the property since 1985, and Spouses Del Rosario, who resided in the same municipality and were formerly friends with Spouses Cesa, failed to conduct an ocular inspection or inquire about the occupants. This failure to exercise due diligence, despite the presence of occupants and the seller not being in possession, negated their claim of good faith, as established in Spouses Vallido v. Spouses Pono. Consequently, Spouses Del Rosario could not rely on the indefeasibility of their title, and Spouses Cesa, as the first buyers in possession, had a better right to ownership under Article 1544 of the Civil Code.
Main Doctrine
A perfected contract of sale, even if initially evidenced by an unnotarized deed, can be established through the subsequent actions of the parties, such as delivery of possession, payment of real property taxes, and introduction of improvements, which indicate the consummation of the sale. Furthermore, in cases of double sale of immovable property, the second buyer who registers the sale must prove that they acted in good faith, which requires more than just verifying the title; it necessitates conducting an ocular inspection and inquiring about any occupants on the property, as failure to do so renders them a purchaser in bad faith, thus losing priority to the first buyer who was in possession.