G.R. No. 256141 - Alexander vs. Spouses Escalona

Respondents Spouses Jorge and Hilaria Escalona married on November 14, 1960, during the effectivity of the Civil Code; during the marriage they acquired unregistered parcels of land, Lot Nos. 1 and 2, totaling 100,375 square meters in Barangay Sta. Rita, Olongapo City.
On June 16, 1998, Jorge executed a Waiver and Quitclaim over Lot No. 1 in favor of his illegitimate son, respondent Reygan Escalona, without Hilaria’s written consent.
On July 28, 2005, Reygan executed a Waiver and Quitclaim of Lot No. 1 in favor of petitioner Belinda Alexander; on August 8, 2005, he executed a Deed of Renunciation and Quitclaim transferring Lot No. 2 to Belinda.
On August 10, 2005, Reygan and Belinda executed a Deed of Absolute Sale covering Lot Nos. 1 and 2 for P1,600,000.00.

On August 5, 2005, Spouses Escalona confronted Belinda at the barangay and informed her Reygan had no authority to sell the lots; Belinda proceeded with the sale on August 10, 2005.
On September 5, 2005, Spouses Escalona filed a complaint for annulment of documents with damages against Belinda and Reygan (RTC Olongapo City, Br. 72, Civil Case No. 342-0-2005), alleging: Lot No. 2 was never transferred to any third person; Jorge’s 1998 waiver was not intended to convey ownership; and Belinda purchased despite notice of lack of authority.
Belinda moved to dismiss on prescription and laches, claimed good faith, and argued Jorge’s waiver was unconditional; she filed a cross-claim against Reygan and a third-party complaint against his mother.
Reygan denied fraud, claimed ownership of Lot No. 1 when he transferred it, and alleged Belinda acted in bad faith.

RTC Decision (February 20, 2017): Dismissed the complaint as time-barred; upheld the questioned transactions; ordered Spouses Escalona to vacate and pay Belinda moral damages and attorney’s fees; dismissed Belinda’s cross-claim and third-party complaint; motion for reconsideration denied (August 22, 2017).
CA Decision (October 26, 2020): Reversed the RTC; declared void the 1998 Waiver and Quitclaim, the July 28, 2005 Waiver and Quitclaim, the August 8, 2005 Deed of Renunciation and Quitclaim, and the August 10, 2005 Deed of Absolute Sale; held the action to declare inexistence imprescriptible (Art. 1410, Civil Code); found Belinda not a buyer in good faith; denied Belinda’s motion for reconsideration (March 5, 2021).
Petition for Review: Belinda contended the lots belonged exclusively to Jorge; transactions were valid; action had prescribed; she was a buyer in good faith; and she was entitled to reimbursement if the contracts were void.

Whether the applicable law governing the status of the alienation/encumbrance of conjugal property and the prescriptive period is determined by the date of marriage (Civil Code) or the date of the transaction (post–Family Code).

Specifically, whether Article 124 of the Family Code or Articles 166 and 173 of the Civil Code apply where spouses married under the Civil Code but the alienations occurred after the Family Code took effect.

Whether Lot Nos. 1 and 2 are conjugal properties and, if so, the legal effect of dispositions made without the wife’s consent.

For Lot No. 1: effect of Jorge’s 1998 waiver to Reygan and Reygan’s subsequent transfers.
For Lot No. 2: effect of transfers despite absence of any conveyance from Spouses Escalona to Reygan.

Whether the action to nullify the transactions is imprescriptible or subject to limitation; and whether laches applies.

Whether Belinda is entitled to reimbursement of the purchase price from Reygan and the proper mode of granting such relief.