Facts:

The case involves Anisia Aquino and Ambrosio Aquino, who are petitioners, against respondents Sotero Esguerra and Rufina Tandoc. The events leading to this case began on November 19, 1928, when Filomena Manaois sold a parcel of land to Sotero Esguerra, granting him the right to repurchase the property within five years. Filomena Manaois passed away in 1929, and the land was never repurchased. Subsequently, the land became the subject of a cadastral proceeding, identified as lot 2758. On August 5, 1938, the Court of Appeals adjudicated a three-fifth portion of this lot to the heirs of Filomena Manaois, while the remaining two-fifths were awarded to Teodora Manaois.

Due to the loss of a portion of lot 2758, Anisia Aquino, Arnulfo Aquino, Romulo Aquino, and Benigno Aquino—children of Filomena Manaois—executed an agreement on November 12, 1940, conveying a portion of lot 2761 to Sotero Esguerra. This agreement aimed to compensate Esguerra for the portion he lost from lot 2758....

Facts:

Transaction and Right of Repurchase

• On November 19, 1928, Filomena Manaois sold a parcel of land to Sotero Esguerra with a contractual right of repurchase within five years.
• Filomena Manaois died in 1929, leaving the land subject to subsequent legal proceedings.

Cadastral Proceedings and Adjudication

• The land later became the subject of a cadastral proceeding, identified as lot 2758.
• On August 5, 1938, the Court of Appeals, in its decision, adjudicated only a three-fifth portion of the lot to the heirs of Filomena Manaois, while the remaining two-fifths was awarded to Teodora Manaois.
• Sotero Esguerra thereby lost a portion of lot 2758 based on the adjudication.

Subsequent Agreement of Conveyance

• To remedy the loss, on November 12, 1940, Anisia Aquino, Arnulfo Aquino, Romulo Aquino, and Benigno Aquino (children of Filomena Manaois—with the minors represented by Ambrosio Aquino, husband of Filomena) executed an agreement.
• The agreement provided that the heirs would convey to Sotero Esguerra a portion of the three-fifths of lot 2761 (also adjudicated in the cadastral proceeding) that was equivalent in extension to the two-fifths portion of lot 2758 lost by Sotero.
• Under Exhibit C of the agreement, the heirs ceded their rights in exchange for the settlement of any claims by Sotero Esguerra against them.

Initiation of Legal Action by Respondents

• Failing to gain possession of the conveyed portion, Sotero Esguerra and his wife, Rufina Tandoc, filed a complaint in the Court of First Instance of Pangasinan.
• The complaint sought recovery of the portion of lot 2761 conveyed by the heirs, including the recovery of lost rentals.

Lower Court and Appellate Decisions

• The Court of First Instance of Pangasinan rendered a decision dismissing the complaint.
• On appeal, the Court of Appeals partially reversed the decision:
• It affirmed the dismissal against defendants Romulo Aquino and Benigno Aquino.
• It reversed the dismissal as to defendants Anisia Aquino, Maria Corona Aquino, and Isabel Aquino.
• The Court of Appeals declared Sotero Esguerra and his wife as the owners and rightful possessors of an undivided three-tenths (3/10) portion of lot 2761.
• The appellate decision further ordered the responsible defendants to indemnify the respondents for damages in possession at a specified annual rate, starting from 1942 until the portion was delivered.
• A discrepancy was noted in the computation of the area conveyed, given that the complaint detailed 10,317.6 square meters (equivalent to 2/5 of lot 2758) versus the awarded 3/10 of lot 2761, leading to further controversy regarding the precise quantum of property and corresponding damages.

Contentions on Validity and Liability

• Petitioners (Anisia Aquino and Ambrosio Aquino representing the minors) contended that:
• The November 12, 1940, agreement (Exhibit C) was invalid on the basis that it was erroneously entered under the mistaken belief of obligation to compensate for lot 2758's lost portion.
• The remedy for Sotero Esguerra against the deceased’s title must lie against the estate of Filomena Manaois, not against her heirs.
• The Court of Appeals upheld the validity of the agreement for those petitioners who had acted for their own benefit and with full capacity.
• The agreement was also upheld as a valid contract of compromise because it prevented more circuitous and expensive litigation and served a valuable consideration.

Issue:

Validity of the November 12, 1940, Agreement (Exhibit C)

• Whether the agreement, executed by the heirs of Filomena Manaois, binding them to convey a portion of lot 2761 in compensation for the loss on lot 2758, is legally enforceable.
• Whether the heirs, who were not liable for the obligations of the deceased, could validly commit their interests in the property under such an agreement.

Determination and Computation of the Property Area and Damages

• Whether the computation of the area to be conveyed, specifically referring to the undivided three-tenths portion of lot 2761 versus the actual extent equivalent to two-fifths of lot 2758, was correctly determined.
• Whether the amount of damages and the year from which they should commence (1942 versus 1943) were appropriately fixed.

Applicability of a Contract of Compromise

• Whether the agreement can be characterized as a contract of compromise that conclusively settles any potential claims by Sotero Esguerra against the heirs.

Ruling:

• (Subscriber-Only)

Ratio:

• (Subscriber-Only)

Doctrine:

• (Subscriber-Only)