Facts:

The case revolves around a petition for review on certiorari filed by Felomina Abellana against spouses Romeo and Lucila Ponce and the Register of Deeds of Butuan City. The events trace back to July 15, 1981, when Felomina, a spinster, pharmacist, and aunt of Lucila, purchased an agricultural lot measuring 44,297 square meters from Estela Caldoza-Pacres for a total price of P16,500. Notably, only P4,500 was stated in the deed of sale upon the seller's request. The deed designated Lucila as the buyer, with the intent that Felomina would ultimately transfer the property to her niece. Title over the lot was formally issued in Lucila's name on April 28, 1992, despite Felomina retaining physical possession and responsibility for real property taxes. However, tension arose between Felomina and the Ponce spouses, leading Felomina to file a case for the revocation of what she considered an implied trust over the property. In her action, she contended that the land was intended f

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Facts:

Transaction Background

• On July 15, 1981, petitioner Felomina Abellana, a spinster and pharmacist, purchased a 44,297-square-meter agricultural lot from the late Estela Caldoza-Pacres with the expressed intention of eventually giving the property to her niece, Lucila Ponce.
• In executing the deed of sale, Lucila was designated as the buyer—even though Felomina was the one who actually paid the purchase price—reflecting Felomina’s customary practice of acquiring properties to be donated to her nieces.
• The total consideration agreed upon was P16,500.00; however, at the seller’s request, only P4,500.00 was stated in the deed of sale.
• On April 28, 1992, a Transfer Certificate of Title (TCT No. 2874) was issued in the name of Lucila, even though Felomina maintained possession, developed the lot through Juanario Torreon, and paid for the real property taxes.

Deterioration of Relationships and Emergence of Dispute

• The amicable relationship between Felomina and the respondent spouses—Romeo and Lucila Ponce—deteriorated over time due to the latter’s alleged ingratitude, disrespect (including insults and attempted physical harm), and failure to properly acknowledge Felomina’s contributions.
• Consequently, Felomina filed an action for revocation of an implied trust to recover legal title to the disputed property.

Contrasting Claims and Subsequent Dealings

• The respondent spouses contended that the purchase price recorded in the deed (P4,500.00) was the actual payment made by them, asserting that the deed and payment were executed in the presence of a lawyer and witnesses, including members of the vendor’s family.
• Later on, arrangements were such that Lucila consented to have Juanario Torreon develop (or till) the lot. Moreover, while the parties shared responsibilities in paying the real property taxes through Felomina, disagreements arose when Felomina refused to pay a later demanded rental.

Evidence and Testimonies

• Felomina’s consistent testimony affirmed that she was the one who truly purchased the lot and remitted the purchase price.
• Witness evidence, particularly from Aquilino Caldoza (a sibling of the vendor), corroborated Felomina’s assertion by stating categorically that Felomina was the buyer and the one who paid the price.
• Testimony from Juanario Torreon further bolstered Felomina’s claim by denying that he had ever been engaged by Lucila, instead confirming that he was recruited by Felomina to develop the lot.
• Documentary evidence—including tax declarations, receipts of real property taxes paid in Felomina’s name, and the survey plan—reinforced Felomina’s actual financial involvement in the purchase.

Nature of the Transaction

• Although the deed of sale designated Lucila as the buyer, the underlying reality was that Felomina had purchased the lot with the intention to donate it to her niece.
• Felomina’s declarations during testimony confirmed her intention to eventually gift the property to Lucila, even as the title was issued in Lucila’s name.
• The transaction effectively straddled the line between a sale (evidenced by the payment made) and a donation (as manifested by the intended transfer of ownership as a gift), thereby generating legal ambiguity regarding the true ownership of the lot.

Procedural History

• The Regional Trial Court (RTC) initially ruled in Felomina’s favor by declaring the existence of an implied trust whereby Felomina, as trustor, was to be the ultimate owner and Lucila simply held the title for her benefit.
• The RTC’s decision ordered the cancellation of TCT No. T-2874 in Lucila’s name and mandated the execution of a conveyance in favor of Felomina.
• On appeal, the Court of Appeals reversed the RTC ruling, holding that Felomina had failed to establish an implied trust and contending that the transaction fell within an exception—suggesting that Felomina’s payment was a gift to Lucila—thus upholding the respondents’ claim to ownership.
• Felomina then elevated the case to the Supreme Court pursuant to a petition for review on certiorari.

Supreme Court Findings

• After a thorough examination of the records, transcript of stenographic notes, and the evidentiary record, the Supreme Court reaffirmed that Felomina was the actual buyer who paid the purchase price.
• The Court noted that the documentary and testimonial evidence—including credible testimony from Felomina and supporting witnesses—decisively contradicted the appellants’ contentions.
• The dispute over whether the transaction constituted an implied trust was resolved in favor of interpreting the transaction as a donation, which, however, was void due to non-compliance with mandatory legal formalities.
• The Court observed that, despite Felomina’s intention to donate the lot by directing that the title be issued in Lucila’s name, the absence of a public instrument rendered the donation imperfect and legally ineffective.
• Ultimately, the Supreme Court reinstated the RTC decision (with modifications) by declaring Felomina the absolute owner of the lot, ordering the cancellation of TCT No. T-2874 in Lucila’s name, and directing the issuance of a new title in Felomina’s name, while deleting the award for attorney’s fees and litigation expenses.

Issue:

• Whether the true and lawful purchaser of the contested lot was Felomina Abellana (who actually paid the purchase price) or the respondent spouses (who claimed they had made payment as reflected in the deed).
• Whether the transaction between Felomina and Lucila Ponce, which was intended as a donation, was perfected in accordance with the legal formalities prescribed for the donation of immovable property.
• Whether the concept of implied trust applies in a situation where the donor’s intention was to transfer ownership through a gift but fell short of complying with the requisite public formality.
• How the conflicting evidences—the deed of sale in Lucila’s name versus the actual payment and subsequent documents in Felomina’s name—impact the determination of the rightful owner of the property.

Ruling:

• (Subscriber-Only)

Ratio:

• (Subscriber-Only)

Doctrine:

• (Subscriber-Only)