Case Digest (G.R. No. 166183)
Facts:
Sps. Tito Alvaro and Maria Valelo v. Sps. Osmundo Ternida and Julita Returban, G.R. No. 166183, January 20, 2006, First Division, Ynares‑Santiago, J., writing for the Court. Petitioners are the spouses Tito Alvaro and Maria Valelo; respondents are the spouses Osmundo Ternida and Julita Returban, owners of an 8,450 sq. m. parcel of riceland in Barangay Labney, San Jacinto, Pangasinan.On May 26, 1986, Julita executed a Deed of Pacto de Retro Sale in favor of spouses Salvador de Vera and Juanita Orinion for P28,000. Thereafter Salvador executed a Deed of Transfer of Mortgage in favor of spouses Jose Calpito and Zoraida Valelo for P32,000. Julita later received additional amounts and signed a Deed of Sale with Right to Repurchase in favor of Calpito and Zoraida Valelo, and subsequently sought further advances.
On May 22, 1990, Julita obtained an additional P1,000 from petitioners Tito Alvaro and Maria Valelo; she testified she was induced to sign what she believed was a mortgage document but which was an on‑its‑face Deed of Absolute Sale. Petitioners thereafter caused issuance of Tax Declaration No. 2747 in their names and refused Julita’s attempts to redeem the property.
Respondents filed on October 1, 1997 a complaint for Annulment of Deed of Sale Documents and Tax Declaration No. 2747 in the Regional Trial Court of Dagupan City (Civil Case No. 97‑01876‑D). The trial court dismissed the complaint for lack of cause of action (Decision dated September 10, 1998) and denied respondents’ motion for reconsideration. On appeal, the Court of Appeals in CA‑G.R. CV No. 61985 reversed by Decision dated July 30, 2004, construing the May 22, 1990 Deed of Absolute Sale as an equitable mortgage, annulling Tax Declaration No. 2747, and giving respondents the right to redeem upon payment of the mortgage debt; its November 3, 2004 Resolution denied reconsideration. Petitioners timely filed a petition for review on certiorari under Rule 45 to the Supreme Court...(Subscriber-Only)
Issues:
- Did the Court of Appeals correctly characterize the May 22, 1990 Deed of Absolute Sale as an equitable mortgage rather than an absolute sale?
- Was the annulment of Tax Declaration No. 2747 in the names of petitioners proper?
- Should the Court have applied Abilla v. Gobonseng, Jr. as urged by petitioners?
- Are the defenses of laches and estoppel available to petitioners to bar respondents’ claim of equitable mortgage?
- Were petitioners entitled to damage...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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