G.R. No. 215006 - Arakor Construction and Development Corp. vs. Sta. Maria

The Spouses Fernando Gaddi, Sr. and Felicidad Nicdao Gaddi owned five parcels of land in Hermosa, Bataan, covered by TCT Nos. T-92141, T-92142, T-92143, T-92144, and T-100713.

Felicidad died intestate in 1985, leaving Fernando Sr. and her eight children (the Gaddis) as her heirs.

Although the heirs inventoried Felicidad’s properties, no partition was effectuated, and the lands remained registered in the names of the Spouses Gaddi.

Following the deaths of Fernando Sr. (in February 1996) and Efren (in May 1998), an attorney representing Arakor Construction and Development Corporation (Arakor), Atty. Greli Legaspi, informed the Gaddis that their parents had allegedly sold the contested properties to Arakor for P400,000.00.

Two undated Deeds of Absolute Sale were produced, with Arakor claiming that the properties had been transferred to its name following the sale purportedly executed on September 8, 1992.

The Gaddis, however, alleged that Felicidad could not have signed the documents because she had been dead for several years prior to the alleged execution of the deeds.

Prior to or after the sale, several Joint Waivers of Claim and/or Right were executed by members of the Gaddi family, ostensibly transferring or consolidating interests in favor of Fernando Sr.

The waivers were executed at different times and under varying formalities, with some being notarized while others were not and containing dates that were inconsistent with the timeline of the sale.

Arakor relied on these documents to assert that full title and ownership had been consolidated in Fernando Sr.'s favor, thereby nullifying the significance of Felicidad’s signature in the deeds.

The Gaddis filed a Complaint for Annulment of the Deeds of Absolute Sale and the Transfer Certificates of Title, alleging that the deeds were forged and the conveyance fraudulent since Felicidad’s signature could not have been valid.

In its November 16, 2011 Decision, the Regional Trial Court declared the Deeds of Absolute Sale void as fictitious, ordered reinstatement of the titles in the names of the Spouses Gaddi, and provided for the return of the purchase price with interest.

The Court of Appeals affirmed the trial court’s decision on January 13, 2014, further noting discrepancies in the signatures and the inability of Felicidad to have consented to the transactions.

Arakor’s subsequent motions for reconsideration and its Petition for Review were denied, with the appellate court’s ruling being modified only insofar as the interest computations were concerned.

Whether the Deeds of Absolute Sale are null and void by reason of being executed after the death of Felicidad, rendering her signature forged.
Whether the waivers executed by the Gaddis, which purportedly consolidated rights in favor of Fernando Sr., are valid and sufficient to bar the annulment of the sale.
Whether Arakor can be considered a buyer in good faith, given its reliance on the signatures and the representations of Fernando Sr. and Efren, and the due diligence exercised by its counsel, Atty. Legaspi.
Whether the passage of time and the Gaddis’ inaction, including their alleged waiver of rights, invoke defenses such as prescription or laches.
Whether the court should restore the parties to their pre-sale positions, including the cancellation of the titles issued in favor of Arakor and the reimbursement of the purchase price with computed legal interest.