Title
Aloria vs. Clemente
Case
G.R. No. 165644
Decision Date
Feb 28, 2006
A U.S.-based owner discovers his property in the Philippines was fraudulently sold. Courts rule forged documents void, reinstating his ownership, rejecting buyer's good faith claim, and remanding for reimbursement determination.
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Case Digest (G.R. No. 165644)

Facts:

Ownership and Initial Dispute

  • Petitioner Manuel B. Aloria, a resident of the United States since December 1992, was the registered owner of a parcel of land and a two-story residential building in Caloocan City under Transfer Certificate of Title (TCT) No. 195684.
  • During his visit to the Philippines in July 2000, Aloria discovered that TCT No. 195684 had been canceled and replaced by TCT No. C-342854 in the name of respondent Estrellita B. Clemente, based on a notarized Deed of Absolute Sale dated April 18, 2000 (Exhibit "D"), which he claimed was falsified.

Petitioner's Claims

  • Aloria, through his attorney-in-fact Bernardino B. Aloria, filed a complaint for annulment of the Deed of Absolute Sale (Exh. "D") and TCT No. C-342854, reconveyance, damages, and costs of the suit.
  • He alleged that the signature on Exh. "D" was forged, as he was in the United States at the time of its execution.

Respondent's Defense

  • Respondent Clemente denied involvement in the execution of Exh. "D" and claimed her signature on the document was also forged.
  • She asserted that she purchased the property from Aloria's parents-in-law, Bernardino and Melinda Diego, through a March 13, 2000 Deed of Absolute Sale (Exh. "1").
  • Clemente argued that the Diego spouses were in possession of Aloria's TCT and a 1994 Deed of Absolute Sale (Exh. "2") purportedly executed by Aloria and his wife in their favor.
  • She claimed to have spent approximately P800,000 on improvements to the property and sought reimbursement.

Trial Court Decision

  • The Regional Trial Court (RTC) declared Exh. "D" and Exh. "1" void, canceled TCT No. C-342854, and ordered the issuance of a new title in Aloria's name.
  • The court also ordered Clemente to pay moral damages, exemplary damages, attorney's fees, and costs of the suit.
  • However, the court ruled that Aloria must reimburse Clemente P400,000 (half of the amount spent on improvements) to prevent unjust enrichment.

Court of Appeals Decision

  • The Court of Appeals reversed the RTC decision, holding that Aloria failed to prove by clear and convincing evidence that he was in the United States at the time of the execution of Exh. "D" and Exh. "2."
  • The appellate court ruled that Clemente was a purchaser in good faith and that the parol evidence rule barred Aloria from disputing the terms of the written agreements.

Issue:

  1. Whether there was a valid transfer of the property to respondent Clemente.
  2. Whether Clemente was a purchaser in good faith.

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)

Conclusion:

The Supreme Court affirmed the RTC's decision declaring the Deed of Absolute Sale and TCT No. C-342854 void, reinstated Aloria's ownership of the property, and remanded the case for further proceedings on the issue of reimbursement for improvements.


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