G.R. No. 112796 - Lagazo vs. Court of Appeals

Plaintiff-appellee (petitioner) Tito R. Lagazo sought to recover possession of a parcel of land from defendant-appellant (respondent) Alfredo Cabanlit, claiming ownership by donation from his grandmother, Catalina Jacob Vda. de Reyes.
Catalina Jacob was awarded a 60.10-square meter lot (Lot 8W, Block 6, Psd-135834) in the Monserrat Estate, a public land distributed for sale to bona fide tenants. She constructed a house on the lot.
Catalina left for Canada in 1977 and executed a special power of attorney in favor of her son-in-law, Eduardo B. EspaÑol, to manage her claim to the lot. She revoked this power in 1984 and gave the same authority to petitioner.

On January 30, 1985, Catalina executed a Deed of Donation in favor of petitioner over the lot. Subsequently, petitioner paid the delinquent installments and arrearages on the lot to clear it from the delinquent list.
Petitioner demanded that respondent vacate the premises, but respondent refused, asserting ownership based on:

Deed of Absolute Sale by Catalina to Eduardo EspaÑol dated October 7, 1977, over the residential house;
Deed of Assignment by Catalina to Eduardo EspaÑol dated September 30, 1980;
Deed of Assignment by Eduardo EspaÑol to respondent dated October 2, 1982.

Petitioner maintained that the donation deed was valid and that he had better right and possession of the lot. Respondent claimed ownership through the chain of assignments and sale.

Trial court ruled in favor of petitioner, finding his version more credible and that he had better right over the property, noting respondent’s failure to register ownership or declare the property under his name.
Court of Appeals reversed, holding that:

The donation was not perfected due to absence of acceptance by petitioner communicated to donor;
Donation was simple, not onerous, because the deed did not impose any burden; payments by petitioner were voluntary and did not convert the donation into an onerous one;
Formal requirements for acceptance and notification of acceptance were not complied with, rendering the donation invalid.

Petitioner raised supervening events, noting that the City of Manila issued a deed of sale and certificate of title in his name based on the donation.
A city investigation report contradicted trial testimonies about occupation and structures on the lot, but the court favored trial testimonies over the unchallenged report.
Court noted that issues concerning respondent’s ownership through assignments could not be resolved without impleading the assignors, who were not parties in the case.

Whether the acceptance of the donation made in a separate instrument but not formally communicated to the donor rendered the donation incomplete, invalid, and void.
Whether the deed of donation, which did not expressly impose any burden but was accompanied by petitioner’s voluntary payment of arrears and balance, constituted an onerous donation governed by the rules on ordinary contracts.
Whether supervening events, including transfer of title by the City of Manila to petitioner, can render the Court of Appeals’ decision manifestly unjust, unfair, or inequitable.
Whether petitioner is entitled to attorney’s fees despite failure to prove ownership.