G.R. No. L-13246 - Calero vs. Carion y Santa Marina

Case Summary (G.R. No. L-13246)

Factual Background

Calero, acting as broker, negotiated for the acquisition of a Plaza Santa Cruz property. An initial proposal (early 1937) was for a joint purchase (Calero P10,000; Enrique Carrion P15,000 toward a P25,000 down payment). Parties later abandoned joint ownership and, by agreement executed May 28, 1937 (Exhibit A), the property was to be purchased in the name of the Carrions. Exhibit A recited Calero’s prior services and promised to pay him “an amount equivalent to twenty percent (20%) of any amount obtained from the sale of the said buildings and land, after deducting the total amount paid by” the defendants — explicitly described as 20% of the net profit from any sale, whether the sale occurs through Calero’s mediation or not. Calero alleged continuing offers to the Carrions to sell at buyer-offered prices since 1937, that a buyer offered P1,455,900, and that defendants refused to sell; he sought accounting and 20% of net profits, and alternatively asked the court to fix a reasonable period for sale under Article 1197 of the New Civil Code.

Pleadings and Relief Sought

Calero’s amended complaint sought: (A) a full accounting of income and expenses from the property since May 28, 1937, with payment of 20% of net proceeds to him; and (B) an order fixing a three‑month period for defendants to sell the property for not less than the then-offer (P1,455,900) or, failing sale, to pay Calero 20% of the net profits with legal interest. Paragraph 15 of the amended complaint expressly invoked Article 1197 of the New Civil Code, alleging the contract contained no definite period and asking the court to fix one.

Motions to Dismiss and Trial Court Directions

Defendants moved to dismiss the original complaint (February 2, 1957) contending lack of cause of action and that the claim was barred by prescription (Rule 8, Sec. 1[e]). The trial court, noting that Calero conceded the obligation lacked a fixed term and that the court should determine a reasonable period, ordered an amendment (June 1, 1957). Calero filed the amended complaint (June 15, 1957). Defendants renewed their motion to dismiss (July 18, 1957), again asserting failure to state a cause of action, prescription, and that an amendment could not cure the original deficiency. The trial court initially denied the renewed motion (order of August 21, 1957), but upon reconsideration reversed course and dismissed the amended complaint on October 1, 1957, on the ground that Calero’s action to have the period fixed had prescribed.

Trial Court’s Rationale on Prescription

The trial court held that the right to have a court fix the undetermined period under Article 1197 is not imprescriptible. Relying on prior Philippine cases (notably Gonzales v. De Jose) and Section 43(1) of the Code of Civil Procedure, the trial court concluded that the action to fix a period for performance is subject to a ten‑year prescription. Because Exhibit A dated May 28, 1937, and Calero did not file the claim to have the period fixed until December 1956 (nearly twenty years later), the court concluded the claim was clearly time‑barred and dismissed the amended complaint with costs.

Issues on Appeal

The appeal presented two principal legal challenges: (1) whether the contract created an implied trust (fideicomiso implicito) under Articles 1452 and 1453 of the New Civil Code (thereby potentially affecting prescriptive computation or enforceability); and (2) whether Calero’s cause of action to have the period fixed was barred by prescription, or whether prescription did not begin to run until defendants were formally demanded and refused to sell.

Court’s Analysis — Implied Trust Claim

The Supreme Court rejected Calero’s implied trust theory. Article 1452 (trust arising where two or more agree to purchase and legal title is taken in one of them for the benefit of all) was inapplicable because the contract contained no stipulation of joint purchase or of holding title in the defendants for Calero’s benefit. The contractual recitals referred to Calero’s services as broker and the defendants’ agreement to compensate him; nothing indicated that the defendants held title in trust for Calero or that the property was purchased for his benefit. Article 1453 (implied trust where property is conveyed in reliance upon declared intention to hold it for or transfer it to another) likewise did not apply: the agreement contained no expression that the defendants received title in reliance on an intention to hold for or transfer to Calero. The court emphasized the clear and unequivocal language of Exhibit A that the 20% was a contractual share of net proceeds payable to Calero, not an indication that the conveyance of title was in trust for him.

Court’s Analysis — Prescription and Time of Accrual

The Supreme Court upheld the trial court’s prescription ruling. The Court reasoned that the right

Case Syllabus (G.R. No. L-13246)

Procedural Posture and Court

Appeal from the order of the Court of First Instance of Manila in Civil Case No. 31409 dismissing plaintiff Federico Calero’s complaint on the ground of prescription.
Appeal to the Supreme Court (G.R. No. L-13246) presents questions purely of law.
Decision rendered March 30, 1960 by Justice Barrera; Paras, C.J., Bengzon, Montemayor, Bautista, Angelo, Labrador, Reyes, J. B. L., and Gutierrez David, JJ., concur. Justice Concepcion took no part.

Chronology of Key Filings and Orders

December 20, 1956 — Plaintiff filed the original complaint in the Court of First Instance of Manila (the record also refers to the action as commencing on December 21, 1956).
February 2, 1957 — Defendants (Emilia Carrion, Maria Carrion and their husbands Jose Falco and Manuel Perez Guzman) filed a motion to dismiss on grounds: (1) complaint states no cause of action, and (2) cause of action, if any, is barred by the Statute of Limitations (Sec. 1[e], Rule 8, Rules of Court).
March 16, 1957 — Plaintiff filed opposition to defendants’ motion to dismiss.
June 1, 1957 — Trial court ordered plaintiff to amend the complaint within twenty (20) days to state the period to be fixed under Article 1197 because plaintiff conceded that “por tratarse de una obligacion sin plazo fijo, este debe ser determinado por el Hon. Juzgado.”
June 15, 1957 — Plaintiff filed an amended complaint containing a new Paragraph 15 invoking Article 1197 of the New Civil Code and a new prayer asking the court to fix a three-month period for sale.
July 18, 1957 — Defendants renewed their motion to dismiss the amended complaint on three grounds: (1) still no cause of action; (2) prescription under Sec. 1(e), Rule 8; and (3) the original complaint being without cause of action cannot be cured by amendment changing plaintiff’s theory.
August 21, 1957 — The trial court issued an order denying defendants’ renewed motion to dismiss.
August 27, 1957 — Defendants filed a motion for reconsideration of the August 21 order; the plaintiff opposed on September 7, 1957; defendants filed rejoinder on September 16, 1957.
October 1, 1957 — Trial court granted defendants’ motion for reconsideration and dismissed plaintiff’s amended complaint with costs on the ground of prescription, holding the action to have the period fixed was barred by the ten-year prescription fixed under Section 43(1) of the Code of Civil Procedure and related authorities.
October 3, 1957 — Plaintiff filed motion for reconsideration of the dismissal order; defendants opposed on October 18, 1957.
October 23, 1957 — Trial court denied plaintiff’s motion for reconsideration; plaintiff appealed to the Supreme Court.

Factual Allegations (as pleaded in the complaint and amended complaint)

Early 1937 — Plaintiff proposed a joint business to Don Enrique Carrion to acquire a property at Plaza Santa Cruz for P250,000, with P25,000 down (Don Enrique Carrion to contribute P15,000 and plaintiff P10,000).
Don Enrique Carrion accepted the proposition and authorized closing the transaction in the names of his daughters (the two principal defendants).
Don Enrique Carrion left the Philippines; negotiations continued through Don Santiago Carrion, who was attorney-in-fact and administrator for both the daughters and plaintiff’s counterpart.
When preparing the deed of purchase, Don Santiago Carrion explained that creating a co-ownership (comunidad de bienes) would be complicated and proposed instead that the property be purchased exclusively in the defendants’ names with the obligation to pay plaintiff twenty percent (20%) of the profits upon sale.
Plaintiff accepted the proposal on the understanding the property would be sold as soon as a buyer offered no less than P300,000.
Parties executed a formal contract on May 28, 1937 (Exhibit “A”) embodying the last agreement, reciting that upon sale the defendants would pay plaintiff “a quantity equivalent to twenty percent (20%) of any amount obtained from the sale of the said buildings and lots, after deducting the total amount paid by said defendants.”
Plaintiff alleges he made several offers to the defendants to sell the property at the buyers’ prices since 1937, and that defendants refused these offers.
Plaintiff claims at the time of filing he had a buyer offering P1,455,900 for the property, that defendants refused to sell at that price, and that defendants had profited from rents since 1937 without giving plaintiff any share.
Plaintiff alleges damages consisting of at least twenty percent (20%) of the net profits obtained by defendants from sale or rent, quantified under a hypothetical sale at P1,455,900 as a net profit of P1,205,900 and a plaintiff’s share of P241,180 (20%).

Terms and Nature of Exhibit “A” (contract executed May 28, 1937)

The contract recitals identify plaintiff’s services as broker and refer to his “trabajos, sugestiones, concejos y ayuda” in relation to purchase, and promise further assistance regarding sale, lease, administration and improvements.
The operative obligation (paragraph 5 of Exhibit A, quoted in Spanish in the record) states that Don Santiago Carrion, as attorney-in-fact for the named defendants, promises to pay plaintiff, his successors and assigns, a sum equivalent to 20% of any amount obtained from sale of the described buildings and lots after deducting the total amount paid by the defendants to the owner El Hogar Filipino; the 20% is to be taken from the net profit whether sale is through Mr. Calero or without him.
The contract contains n