G.R. No. 92492 - Vda. de Canilang vs. Court of Appeals

Petitioners: Heirs of Herminio Marquez, represented by Alma Marie Marquez (Marquez).
Respondents: Heirs of Epifania M. Hernandez, represented by Lourdes H. Tiongson (also spelled Tionson).
Case stems from a complaint for specific performance with damages filed by respondents on November 21, 2000 against Herminio Marquez. Marquez was later impleaded as defendant in an amended complaint.

Respondents and Epifania have been occupying a 200-square meter parcel in Matungao, Bulacan since 1955, which is part of a larger 1,417-square meter property originally owned by spouses Anastacio and Lourdes Sakay and spouses Godofredo and Florsita Cruz.
In 1967, spouses Sakay and Cruz sold the entire 1,417-square meter property to Herminio.
In 1985, Herminio sold the 200-square meter portion to Epifania for P400.00 per square meter. Sale was conditional: if Epifania failed to pay in full by year-end 1985, transaction would be treated as lease with payments considered as rentals or advances.
Epifania paid P2,000.00 initial payment, evidenced by a provisional receipt dated October 23, 1985 signed by Herminio.
Payments were also made through installment by depositing money in a joint bank account with Herminio and by issuing various P500 metrobank checks.
Respondents asserted that Epifania completed full payment before her death in 1995.
In March 2000, respondents executed an Extrajudicial Settlement designating proceeds from the joint bank account as full payment for the land; Herminio signified conformity by signing the document.
The Rural Bank of Del Pilar ceased operations; PDIC released a check worth P61,429.87 to Herminio in 2000.

On December 15, 1999 and July 17, 2000, respondents received demand letters from Marquez to vacate the subject property.
In 1994, Marquez and Herminio executed an Extrajudicial Settlement with Waiver of Rights whereby Herminio waived all interest over the 1,417 sqm in favor of Marquez.
Herminio allegedly refused to execute a deed of absolute sale over the subject property in favor of respondents despite their demands.
Respondents thus filed an amended complaint seeking specific performance to effectuate the sale and have the title transferred.
Herminio and Marquez both answered, denying validity of sale, asserting amount paid was rental, and questioning real party in interest. Herminio later died and was substituted by petitioner.

RTC ruled in favor of respondents on January 28, 2016: validated the sale, declared the contract consummated upon initial payment and possession, ordered partition of the 1,417 sqm property to give effect to sale, directed cancellation of the existing title, and issuance of separate titles in names of Epifania and Marquez.
RTC rejected Marquez’s claim that payments were rentals, emphasizing delivery and possession transferred ownership even prior to full payment.
The court held that respondents’ action for quieting of title is imprescriptible due to their possession; laches and estoppel claims were denied.
Marquez’s motion for reconsideration was denied.

CA affirmed RTC decision with modifications: deleted RTC’s order directing partition and cancellation of titles, reasoning that partition is a special proceeding outside ordinary civil action jurisdiction.
Confirmed complaint is one for quieting of title, not specific performance.
Found respondents not guilty of laches due to continuous possession.
CA’s motion for reconsideration was denied, prompting this petition.

Whether the lower courts gravely erred in converting the action filed as one for specific performance into quieting of title without allegations warranting such.
Whether the complaint was barred by prescription since it was filed more than ten years after the alleged breach.
Whether the conversion of specific performance to quieting of title constitutes a prohibited collateral attack on the certificate of title.
Whether a valid contract of sale existed given the absence of a public instrument as required for sale of real property and lack of Marquez’s consent as co-owner.
Whether the RTC had jurisdiction to order partition of the 1,417-square meter property.
Whether respondents’ claims are barred by laches considering the delay in asserting rights.