G.R. No. 134685 - Siguan vs. Lim

On 25 and 26 August 1990, respondent Rosa Lim (“Lim”) issued two Metrobank checks payable to “cash” in the amounts of ₱300,000 and ₱241,668, respectively, which were dishonored upon presentment for the reason “account closed.”
Petitioner Maria Antonia Siguan (“Siguan”) filed criminal cases for violation of Batas Pambansa Blg. 22 (Criminal Cases Nos. 22127-28) before RTC, Branch 23, Cebu City. On 29 December 1992, the trial court convicted Lim; appeal pending before the Supreme Court as G.R. No. 134685.
Prior thereto, on 31 July 1990, Lim had been convicted by RTC, Quezon City (Criminal Case No. Q-89-2216) for estafa filed by Victoria Suarez. That conviction was affirmed by the Court of Appeals; on further appeal, this Court (7 April 1997) acquitted Lim of the crime but imposed civil liability of ₱169,000 plus interest.

On 10 August 1989, Lim purportedly executed a Deed of Donation conveying four parcels of land in Cebu City (TCT Nos. 93433, 93434, 87019, 87020) to her children Linde, Ingrid and Neil Lim; this deed was registered only on 2 July 1991, and new titles issued in the donees’ names.
On 23 June 1993, Siguan filed an accion pauliana (Civil Case No. CEB-14181, RTC Branch 18, Cebu City) against Lim and her children, seeking rescission of the Deed of Donation and cancellation of the transfer certificates on grounds of fraud of creditors, antedating of the deed, conspiracy among parties, and insufficiency of remaining assets to satisfy debts.
RTC, Branch 18, in its 31 December 1994 decision, ordered:

Rescission of the Deed of Donation;
Nullification and cancellation of the new titles;
Reinstatement of Lim’s original titles; and
Joint and several liability of Lim and her children to pay Siguan ₱10,000 moral damages, ₱10,000 attorney’s fees, and ₱5,000 litigation expenses.

On appeal, the Court of Appeals (20 February 1998) reversed and dismissed the accion pauliana, holding that:

No pre-existing debt at the time of the Deed’s execution (debt incurred August 1990 vs. deed dated August 1989);
No convincing proof of antedating or intent to defraud; and
The deed, as a notarial document, is prima facie evidence of its date under Section 23, Rule 132, Rules of Court.

Siguan elevated the case to this Court under Rule 45, raising as the pivotal issue whether the Deed of Donation was entered into in fraud of her creditor’s rights, and challenging the denial of damages awards.

Whether the Deed of Donation executed by Rosa Lim in favor of her children is rescissible under accion pauliana for being in fraud of creditor Maria Antonia Siguan.
Whether the trial court’s awards of moral damages, attorney’s fees, and litigation expenses in favor of Siguan are proper.