G.R. No. L-46715-16 - Zaide vs. Court of Appeals

Case Digest (G.R. No. L-46715-16)
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Facts:

Properties, parties, and source of alleged ownership transfer

Edita Zaide and Roberto de Leon were the registered owners of a parcel of land situated in Makati, Rizal, with an area of 201 square meters, covered by TCT No. 69088.
In the middle of the sixties, Primitivo Zaide (Edita’s brother) gave to Edita and Roberto de Leon PHP 2,000.00 as a loan, which the latter used to redeem land mortgaged to the Pasay Rural Bank.
At about the same time, Primitivo Zaide and his wife, Leoncia T. Zaide, transferred ownership of a jitney valued at PHP 7,000.00 to Roberto de Leon.
The Zaide spouses claimed the jitney transfer was ceded as part of the purchase price for the de Leons’ land, which they agreed to buy.
The loan and the vehicle transfer were not disputed.

Execution of two deeds of sale affecting title to the land

On January 11, 1965, Edita Zaide executed a public instrument denominated “Deed of Sale” in consideration of PHP 5,000.00, by which she sold the parcel covered by TCT No. 69088 to Leoncia T. Zaide.
The deed described both vendor and vendee as “married” but named neither of their husbands.
The document bore the signature of Edita’s husband, Roberto de Leon, indicating his “marital consent.”
Because the vendee’s husband was not named, the Register of Deeds refused registration of the deed.
A second deed of sale was then executed, couched in the same terms as the first, acknowledged before the same Notary Public (Judge Rafael Madrazo), and bearing the same date (January 11, 1965) and document identification in the notarial registry (“Doc. No. 955, Page No. 92, Book No. 4, Series of 1965”).
The second deed differed only in that it set forth the names of the husbands of both the vendor and the vendee.
This second deed was shortly thereafter presented and promptly accepted for registration.
The Register of Deeds then cancelled TCT No. 69088 and issued a new title, TCT No. 138606, in the name of “Leoncia T. Zaide, married to Primitivo Zaide.”

Later loans and construction on the land; the fire and ensuing occupancy

With the lot as collateral, the Zaide spouses obtained a loan from the Government Service Insurance System in the amount of PHP 28,500.00.
The loan proceeds were used to construct a two-story apartment building on the land.
On June 1, 1969, the house of the de Leons burned down.
The de Leons moved to one of the doors of the apartment built on the land.
The de Leons were asked to pay rentals, but they refused, prompting litigation.

Civil Case No. 11977: complaint to cancel the Zaide title

On July 4, 1969, the de Leon spouses filed a complaint with the Court of First Instance of Rizal against the Zaide spouses, docketed as Civil Case No. 11977.
The de Leons alleged that in June 1964 they discovered that their title (TCT No. 69088) had been cancelled and another title (TCT No. 138606) issued to the Zaides.
They alleged the cancellation and issuance were based on “a forged deed of sale supposedly executed in Tagaytay City on the 11th day of January, 1965.”
They asserted they could not have sold the land for PHP 5,000.00 as shown in the forged deed, considering that the market price could not be less than PHP 20,000.00.
The de Leons prayed for:

1) cancellation of TCT No. 138606; 2) reissuance of another title in the name of plaintiff EDITA ZAIDE; 3) damages; and 4) attorney’s fees.

Because Primitivo Zaide and Leoncia T. Zaide were both killed in Tagaytay City on January 14, 1970, the complaint was amended to substitute their minor children—Pacita, Alexander, and Maria Zerlina, all surnamed Zaide—represented by their guardian ad litem, Simeon Tolentino.

Civil Case No. 14044: lease and ejectment-type relief by minors

On October 20, 1970, the Zaide children through their guardian ad litem Simeon Tolentino filed suit against the de Leon spouses in the same Court of First Instance of Rizal, docketed as Civil Case No. 14044.
They sought recovery of possession of the apartment unit occupied by the de Leons and payment of rentals at the rate of PHP 300.00 under a verbal contract of lease.
The case was later transferred to the same branch handling Civil Case No. 11977.
The cases were then tried jointly.

Trial court decision and its reconsideration

Judgment was rendered in favor of the Zaide spouses on September 25, 1972.
In Civil Case No. 11977, the trial court dismissed the de Leons’ complaint and declared the sale legal and valid, ordering rejections of the de Leons’ claim and effecting title validity in favor of the Zaides.
In Civil Case No. 14044, it ordered payment of PHP 250.00 as rental representing the use and occupancy of one door of the apartment from January 1, 1969 and every month thereafter until Edita Zaide and Roberto de Leon vacated, and it required the de Leons or persons claiming under them to vacate.
The de Leons moved for reconsideration.
By Order dated April 10, 1973, a different judge granted the motion.
The Order relied on testimony of an NBI handwriting expert concluding that signatures of both plaintiffs Edita Zaide and Roberto de Leon in the second deed of sale (Exhibit A, the second deed) were forgeries based on sample signatures from other documents.
The Order held the defect in the first deed—omission of husbands’ names—could not be corrected by a forged document, because a forged document was considered inexistent before the law.
It declared TCT No. 138606 null and void as “the fruit of a forged Deed of Sale.”
It ordered the Register of Deeds of Rizal to reissue the title over the disputed parcel in the name of the de Leons.
As to Civil Case No. 14044, the Order stated it would not disturb the prior findings, though it simultaneously noted that, as originally decided, the de Leons were ordered to pay rentals and vacate.

Court of Appeals ruling

The children of the deceased Zaide spouses, as well as Roberto de Leon (defendant in Civil Case No. 14044), appealed to the Court of Appeals.
The Court of Appeals held that the de Leons had not made an admission of the genuineness of the first deed of sale (Exh. 1); it further held that counsel’s trial statement that they were “not contesting” Exhibit 1 did not constitute an outright admission but indicated they limited the controversy to forgery of Exhibit 2.
The Court of Appeals held that the signatures on the second deed (Exhibit 2) were forgeries.
The Court of Appeals reasoned that because the Zaides invoked the second deed as the basis of title, they could not be buyers in good faith.
It held the ejectment aspect of Civil Case No. 14044 was incongruous with findings that the deed of sale was spurious and the Zaides were in bad faith.
The Court of Appeals affirmed the nullity ruling and the reversion effect, but modified Civil Case No. 14044 by relieving Roberto de Leon from paying rent for occupancy of one door, stating that the apartment should not be vacated by him and his wife or any person claiming rights from them.

Present appeal by certiorari; central factual dispute on whether Exhibit 2 was forged

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