Case Summary (G.R. No. 128321)
Petitioner
Central Philippine University, which received by deed of donation a parcel of land subject to specific conditions.
Respondents
Heirs of Don Ramon Lopez Sr. (Remedios Franco, Francisco N. Lopez, Cecilia P. Vda. de Lopez, Redan Lopez and Remarene Lopez), claiming reconveyance and damages.
Key Dates
• 1939 – Execution of onerous deed of donation in favor of CPU.
• 31 May 1989 – Filing of action for annulment of donation, reconveyance and damages in RTC, Iloilo City.
• 31 May 1991 – RTC declares donation null and void and orders reconveyance.
• 18 June 1993 – CA reverses and remands for fixing compliance period.
• 17 July 1995 – Supreme Court decision under the 1987 Constitution.
Applicable Law
1987 Civil Code provisions on donations (Arts. 733, 764 [formerly Arts. 646–647]), conditional obligations (Arts. 1181, 1191, 1197) and general prescription (Art. 1144).
Facts
Don Ramon Lopez Sr. donated Lot No. 3174-B-1 to CPU on condition that CPU (1) use it exclusively to establish and operate a medical college; (2) never sell or encumber it; (3) designate it “Ramon Lopez Campus” and allocate any net income to a campus improvement fund. CPU never fulfilled the first condition, and attempted to negotiate an exchange of the land with the National Housing Authority.
Procedural History
The RTC held CPU’s failure to comply voided the donation and directed reconveyance. The CA characterized the donation as onerous with resolutory conditions breach of which revokes the gift, but remanded to fix a compliance period for establishing the medical college. CPU sought review.
Issue Presented
Whether (a) the annotations in the deed and title impose onerous, resolutory obligations making the donation revocable upon breach; (b) prescription bars the heirs’ action; and (c) remand for period-fixing was proper.
Supreme Court Holding
The Supreme Court reinstated and affirmed the RTC judgment, modified the CA decision by eliminating remand for period-fixing, and ordered CPU to reconvey the property within thirty days.
Supreme Court Reasoning
- Nature of the Donation: The deed’s imposed burdens—construction of a medical college and exclusive use—render the donation onerous (Art. 733), entailing obligations equivalent in value to the land.
- Resolutory Effect: The conditions annotated on the title are resolutory; noncompliance extinguishes CPU’s acquired rights and permits revocation (Art. 1181).
- Prescription: CPU’s absolute acceptance of the onerous donation barred prescription from running, since fulfillment timing lay within its own will, preventing limitat
Case Syllabus (G.R. No. 128321)
Facts
- In 1939, Don Ramon Lopez, Sr., then Board of Trustees member of Central Philippine College (now CPU), executed a deed of donation of Lot No. 3174-B-1 (subdivision plan Psd-1144), a portion of Lot No. 3174-B, to CPU; Transfer Certificate of Title No. T-3910-A issued in CPU’s name.
- Annotations in the deed of donation imposed three main “conditions”:
- Exclusive use of the land for establishment and operation of a medical college with all its buildings as part of the curriculum.
- Prohibition against selling, transferring, conveying to third parties, or encumbering the land.
- Naming the land “RAMON LOPEZ CAMPUS,” erecting a cornerstone bearing that name, and creating a “RAMON LOPEZ CAMPUS FUND” from any net income for campus improvements and building erection.
- On May 31, 1989, the heirs of Don Ramon Lopez, Sr. (private respondents) filed an action for annulment of the donation, reconveyance, and damages, alleging CPU never complied with the imposed conditions and negotiating an exchange of the donated land with the National Housing Authority.
- CPU answered that the cause of action had prescribed, asserted full compliance with the donation terms, and denied any sale, transfer, or encumbrance of the property.
Procedural History
- Regional Trial Court (Iloilo City, Branch 34), May 31, 1991: Held CPU failed to comply with donation conditions; declared the donation null and void; ordered reconveyance of the land to private respondents.
- Court of Appeals, June 18, 1993: Determined the annotations constituted resolutory conditions; breach rendered the donation revocable but, in absence of a fixed period for the first condition, CPU could not yet be deemed in default; reversed the trial court and remanded for the trial court to fix the period for compliance.
- Central Philippine University filed a petition for review on certiorari in the Supreme Court, challenging:
- The characterization of the annotations as onerous obligations and resolutory conditions.
- The Court of Appeals’ treatment of prescription.
- The remand for fixing the compliance p