G.R. No. 63575 - Gicano vs. Gegato

The property in dispute is Lot 818, a large tract of land with an area of 225,322 square meters located in Hinigaran, Negros Occidental.
The original title, TCT No. 30009, indicates dual ownership in equal shares by:

The certificate of title clearly establishes the co-ownership arrangement between these parties.

After Maximo Juanico’s death on May 21, 1942, his surviving interests included his wife, Rosa Gegato, and three minor children (Presentacion, Resurreccion, and Catalina).
Following the death of Matilde Geolingo and her husband, their one-half share was adjudicated solely to their only child, Loreto Mongcal, who later sold her share on December 14, 1951, to Rosa Gicano.
This sale led to the cancellation of the original TCT No. 30009 and the issuance of a new title, TCT No. 8878, which recorded:

On August 23, 1952, a document was executed which purported to be a Deed of Sale (or a deed of dacion en pago de deuda) to settle a debt allegedly owed by the late Maximo Juanico to Rosa Gicano.
The document was signed by Rosa Gegato and her second husband, Raymundo Pundon (acting in his capacity as judicial guardian for her minor children, Resurreccion and Catalina), and was duly acknowledged before Notary Public Vicente T. Remitio.
The deed led to further registration changes: TCT No. 8878 was cancelled and, on September 8, 1952, TCT No. 10189 was issued solely in the name of Rosa Gicano, covering the entire Lot 818.

On February 13, 1976, Rosa Gegato and her daughters (Resurreccion and Catalina), through their judicial guardian Raymundo Pundon, initiated an action in the Court of First Instance of Negros Occidental.
The plaintiffs claimed that they had been deceived into believing that only one-third of the minor children’s share was being transferred by the deed of sale, not the entire interest of Maximo Juanico.
It was alleged that due to their inability to properly understand the deed (given their illiteracy in English), they were misled about the true extent of the transfer.
The fraud was only discovered in 1975 when a surveyor’s partitioning of the property revealed that the title had long been registered solely in the name of Nenita Geollegue, who had acquired it from her mother and later mortgaged it.

Rosa Gicano and her co-defendants moved to dismiss the complaint on grounds including lack of cause of action, laches, estoppel, and prescription.
The Trial Court, after initially denying the motion on the ground of lack of cause of action, eventually dismissed the entire complaint based on prescription, emphasizing that an action to recover the immovable under a constructive trust must be commenced within ten (10) years from the issuance of title.
The plaintiffs had filed their action 23 years after the issuance of the title, thereby exceeding the statutory 10-year prescriptive period.
Although the Court of Appeals reversed the dismissal and ordered a full trial on the merits, the Supreme Court ultimately reinstated the dismissal based on the prescription defense.

Whether the alleged fraud in the execution of the deed of sale (purporting to transfer Maximo Juanico’s half share) could justify an annulment or reconveyance of the property under the theory of constructive trust.
Whether the action to recover the property, based on the theory of constructive trust, is subject to the ten (10) year prescriptive period as counted from the issuance of the title.
Whether it is proper to assume that only a portion (i.e., one-third) of the minor children’s inheritance was intended to be conveyed, while the remainder (two-thirds, including part of Rosa Gegato’s conjugal share) was not meant to be transferred.
Whether the trial court and, by extension, the courts below, had the authority to dismiss the action based solely on prescription when sufficient facts on record indicated the lapse of the statutory period.