Case Digest (G.R. No. 239088)
Facts:
Spouses John T. Sy and Leny N. Sy, and Valentino T. Sy v. Ma. Lourdes De Vera-Navarro and Benjaemy Ho Tan Landholdings, Inc., G.R. No. 239088, April 03, 2019, Supreme Court Second Division, Caguioa, J., writing for the Court.Petitioners Spouses John T. Sy and Leny N. Sy (collectively, petitioners Sps. Sy) and Valentino T. Sy filed a Complaint before the Regional Trial Court (RTC), Branch 12, Zamboanga City (Civil Case No. 6333), for declaration of nullity of a Deed of Absolute Sale, cancellation of certificates of title, recovery of ownership, and damages, concerning a commercial parcel and four‑storey building covered by TCT No. T-171,105 (the subject property). The complaint alleged that petitioner John borrowed P3,720,000.00 from respondent Ma. Lourdes De Vera‑Navarro on May 31, 2006, secured by a mortgage contract annotated on TCT T-171,105 on June 2, 2006, and that De Vera‑Navarro had petitioner John execute an undated Deed of Absolute Sale with a stated consideration of P5,000,000.00 as additional security; petitioners valued the property at over P40,000,000.00.
On March 22, 2011 petitioners learned that ownership had been transferred to De Vera‑Navarro and that TCT No. T‑199,288 had issued in her favor; on March 24, 2011 petitioner Valentino annotated an adverse claim on TCT T‑199,288 (carried over to TCT T‑129‑2011001530). On March 30, 2011 De Vera‑Navarro executed a Deed of Absolute Sale conveying the property to respondent Benjaemy Ho Tan Landholdings, Inc. (BHTLI) and a new title (TCT T‑129‑2011001530) was issued in BHTLI’s name on July 21, 2011. Petitioners alleged the undated deed was null and void and only an equitable mortgage; De Vera‑Navarro maintained the undated deed was a genuine sale (asserting it was executed February 6, 2007) and that the loan remained unpaid; BHTLI asserted it was a buyer in good faith, having purchased March 14/30, 2011 and without notice of infirmity.
The RTC rendered judgment on October 8, 2014 declaring the Deed of Absolute Sale dated February 6, 2007 an equitable mortgage, ordering petitioners to pay De Vera‑Navarro P5,000,000.00 (with interest) within 30 days or else ownership vests in De Vera‑Navarro, directing cancellation and restoration of titles accordingly, and declaring the March 30, 2011 sale to BHTLI null and void; the RTC also awarded damages and costs. Respondents moved for reconsideration; the RTC denied the motions on November 24, 2014.
Petitioners and BHTLI separately appealed to the Court of Appeals (CA). De Vera‑Navarro’s appeal was dismissed as abandoned (failure to file appellant’s brief) by CA Resolution dated May 19, 2016. In an assailed Decision dated November 23, 2017 (CA‑G.R. CV No. 04016‑MIN), the CA reversed the RTC, held the undated Deed of Absolute Sale to be a valid sale (characterizing the transaction as a dacion en pago), found BHTLI a buyer in good faith, set aside the RTC decision and dismissed petitioners’ complaint. Petitioners’ motion for reconsideration to the CA was denied in the assailed Resolution dated April 20, 2018.
Petitioners brought a Petition for Review on Certiorari under Rule 45 to the Supreme Court, assailing the CA’s Nove...(Subscriber-Only)
Issues:
- Was the undated Deed of Absolute Sale between petitioner John T. Sy and Ma. Lourdes De Vera‑Navarro a valid contract of sale or, instead, an equitable mortgage?
- Was Benjaemy Ho Tan Landholdings, Inc. a buyer in good faith such that its title should be protected despite the invalidity of the sale between De Vera‑Nav...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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