Case Digest (G.R. No. L-30351)
Facts:
In the case of Aurea Banez and Ramon Banez, substituted by their legal heir Oscar Virata Banez, petitioners, vs. Court of Appeals and Pio Arcilla, respondents, the events unfolded as follows: Pio Arcilla, the respondent, occupied a parcel of land in 1956 located at Lot 5, Block E-130, East Avenue Subdivision, Diliman, Quezon City. This land was owned by the People's Homesite and Housing Corporation (PHHC). Arcilla improved the land by erecting a house and planting on it, and he attempted to acquire the land from PHHC. However, his efforts were met with unfulfilled promises from PHHC officials, although at one point his occupancy was acknowledged during a record census of occupants and squatters. On May 20, 1960, however, the lot was awarded to Cristeta L. Laquihon under a conditional contract to sell that required her to remove any squatters and build a house within one year; failure to do so would result in automatic cancellation of the contract. Arcilla was not notified of
Case Digest (G.R. No. L-30351)
Facts:
- In 1956, respondent Pio Arcilla occupied Lot 5, Block E-130, East Avenue Subdivision, Diliman, Quezon City, owned by the People’s Homesite and Housing Corporation (PHHC).
- Arcilla fenced the lot, erected a house, and made plantings, all without the formal consent of PHHC.
- His occupancy was later recorded during a census of occupants and squatters conducted by the PHHC.
- Despite his moves to apply for the lot once it became available, PHHC employees only made promises without taking substantive action.
Occupancy and Initial Developments
- On May 20, 1960, the PHHC awarded the lot to Cristeta L. Laquihon through a conditional contract to sell.
- The contract included resolutory conditions: the grantee had to eject trespassers, intruders, or squatters, and construct a residential house within one year from the signing of the contract.
- Failure to comply with these conditions would result in the contract being deemed annulled and cancelled.
- Neither Arcilla nor PHHC acted to evict the squatter at the time of the award.
Award of the Lot to Cristeta L. Laquihon
- Cristeta L. Laquihon died on May 9, 1962.
- Her father, Basilio Laquihon, executed a deed of adjudication on July 27, 1962, transferring the rights acquired by his daughter over the lot to himself.
- In the deed, Basilio Laquihon acknowledged a debt of ₱3,000.00 owed by his daughter to petitioner Aurea V. Banez.
- Basilio agreed to assign his rights in the lot to Aurea V. Banez as a means of settling this indebtedness.
Death of Awardee and Transfer of Rights
- Requests for the transfer of rights and assignment to Aurea V. Banez were submitted to the PHHC.
- PHHC’s Head Executive Assistant, Olimpio N. Epis, initially advised disapproval, citing the failure of Cristeta L. Laquihon to construct a residential house within the stipulated period.
- The unfavorable recommendation was returned to Mr. Epis with instructions to restudy the matter.
- Upon restudy, Mr. Epis changed his opinion and considered both the transfer from Cristeta to Basilio Laquihon and the subsequent assignment from Basilio to Aurea V. Banez as proper and meritorious.
- On November 15, 1962, PHHC’s Board of Directors, through Resolution No. 200, approved the transfer of rights from Basilio Laquihon to Aurea V. Banez.
- Petitioner Aurea V. Banez continued paying the purchase installments, and on October 29, 1964, the PHHC executed a deed of sale in her favor.
PHHC Administrative Actions and Transfer Approvals
- Arcilla, having been unaware of these developments until 1963, protested the award and transfer of the lot.
- His protest asserted that Cristeta L. Laquihon, as the original awardee, acquired no rights due to her failure to construct a house; hence, her rights could not be transmitted and he, as an occupant, had a preferential right to purchase the lot.
- The Administrative Investigating Committee dismissed his protest, as the PHHC’s Board had already approved the transfer.
Filing of the Protest and Subsequent Litigation
- In the trial court, the decision was rendered in favor of the petitioners, Aurea V. Banez (later substituted by Oscar Virata Banez after the deaths of Aurea and Ramon Banez), with the complaint of Arcilla dismissed.
- Pio Arcilla appealed to the Court of Appeals.
- On January 9, 1969, the Court of Appeals reversed the trial court decision, declaring the award and transfer null and void, and ordered the PHHC to grant Arcilla a 30-day opportunity to perfect his alleged preferential right to purchase.
Court Proceedings and Appellate Review
- That Arcilla, being a squatter not bound by the conditional contract, lacked the legal personality to annul the award and subsequent transfer.
- That Arcilla’s claim to a preferential purchase right, based on PHHC resolutions adopted later, was unfounded.
- That the award to Cristeta L. Laquihon should be deemed valid despite her noncompliance with the residential construction condition because the PHHC did not provide written notice of contract cancellation.
- That the supposed undue influence by Senator Estanislao Fernandez in the approval of the transfer was neither properly raised nor supported by evidence.
- That the reliance on a tax declaration to establish petitioners’ disqualification from acquiring the lot was insufficient as proof of title.
Assignments of Error Raised by the Petitioners
Issue:
- Consideration of Article 1397 of the Civil Code regarding who may institute an action for annulment.
Whether Pio Arcilla, as a squatter who is not a party to the conditional contract, has the legal personality to annul the award and transfer of the lot.
- Examination of the timing and context of the PHHC resolutions and their applicability to Arcilla’s situation.
Whether Arcilla is entitled to a preferential right to purchase the lot based solely on his occupancy, especially in light of PHHC’s resolutions.
- Analysis of the effect of noncompliance with resolutory conditions and the necessity of written notice of cancellation.
Whether the failure of Cristeta L. Laquihon to fulfill the condition of constructing a residential house automatically voided her award and precluded the transmission of any rights to her successor.
- Determination if such alleged undue influence was properly raised and supported by the evidence.
Whether the approval of the transfer of rights to petitioners was influenced by undue means, specifically the alleged letter from Senator Estanislao Fernandez.
- Assessment of the evidentiary value of tax declarations compared to proper proof of title.
Whether the certification of a tax declaration as evidence of prior property ownership is sufficient to disqualify petitioners from acquiring the contested lot.
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)