Title
Macababbad, Jr. vs. Masirag
Case
G.R. No. 161237
Decision Date
Jan 14, 2009
Heirs alleged fraud in property transfer via forged extrajudicial settlement; SC upheld CA, ruling action imprescriptible, remanding for fraud determination.
macababbad jr
masirag
court of appeals

Case Summary (G.R. No. 161237)

Factual Background

The respondents alleged that deceased spouses Pedro Masirag and Pantaleona Tulauan were the registered owners of Lot No. 4144 under Original Certificate of Title No. 1946 and that they had eight children. The respondents asserted that they did not know of the deaths of certain parents and only learned of their inheritance in March 1999. They alleged that petitioners had caused to be executed an instrument titled “Extra-Judicial Settlement with Simultaneous Sale of Portion of Registered Land (Lot 4144), dated December 3, 1967,” which purportedly bore respondents’ signatures though the respondents denied participation and knowledge. The document allegedly conveyed the property for P1,800.00, after which OCT No. 1946 was cancelled and a Transfer Certificate of Title No. 13408 was issued to multiple persons. Petitioners later obtained or caused issuance of titles to portions of Lot No. 4144 and sold portions to third parties. The respondents alleged forgery, fraud and deprivation of their hereditary shares and sought nullity of the extrajudicial settlement and sale, reconveyance, cancellation of titles, damages and attorney’s fees.

Trial Court Proceedings

The petitioners moved to dismiss on grounds including prescription and non-joinder of indispensable parties. The RTC initially denied the motion but on reconsideration issued an Order dated May 29, 2000 dismissing the complaint. The RTC ruled that the action was barred by prescription because it was filed thirty-two years after the property had been partitioned and partly sold, and that the respondents had failed to implead indispensable parties, specifically other heirs and those who had acquired title in good faith. The respondents appealed the dismissal to the Court of Appeals.

Court of Appeals Proceedings

The Court of Appeals took cognizance of the appeal despite the petitioners’ motion to dismiss the appeal for lack of appellate jurisdiction. The CA considered whether the complaint stated a cause of action and whether the cause had been waived, abandoned or extinguished. The CA found that the pleadings, notwithstanding verbosity, sufficiently alleged that fraud had been committed and that the plaintiffs were deprived of heirs’ interests. The CA applied the Civil Code rule that one who acquires property through fraud holds it as trustee for the true owner and reconciled that rule with Article 1409 and Article 1410 of the Civil Code to conclude that an action to declare the extrajudicial partition void was imprescriptible. The CA therefore reversed the RTC dismissal and remanded the case for further proceedings.

Issues Presented on Appeal and Parties’ Contentions

The petitioners brought a petition for review on certiorari to the Supreme Court, contending primarily that the CA lacked jurisdiction because the issues presented were pure questions of law and therefore should have been brought by petition for review under Rule 45. In the alternative, the petitioners argued that the RTC’s dismissal on non-joinder of indispensable parties had become final and executory, that innocent purchasers who acquired portions were indispensable parties not impleaded, that the CA erred in reconciling Article 1456 and Article 1410 with Article 1409, and that the extrajudicial settlement could not be declared inexistent because it could not be shown that none of the heirs intended to be bound. The respondents maintained that the appeal raised mixed questions of fact and law and accordingly was properly brought to the CA by ordinary appeal, that discovery of the fraud occurred only in 1999 making any action timely, that laches did not apply because the action was promptly filed upon discovery, and that non-joinder of indispensable parties did not justify dismissal.

Supreme Court Ruling

The Supreme Court denied the petition for review for lack of merit and affirmed the Court of Appeals’ reversal of the RTC dismissal. The Court held that the appeal to the CA raised mixed questions of fact and law and that the CA therefore had jurisdiction under Rule 41, Sec. 2. The Court further held that the respondents’ amended complaint sufficiently pleaded a cause to declare the extrajudicial settlement and sale null and void, and that an action seeking the declaration of inexistence or nullity of a contract under Article 1410 is imprescriptible. The Court concluded that the issuance of certificates of title in petitioners’ favor did not convert the action into a time-barred reconveyance claim; registration does not validate a transaction that is null and void. The Court also ruled that dismissal on the ground of laches was improper at the pleading stage and that non-joinder or misjoinder of parties is not a ground for dismissal under Rule 3, Sec. 11 of the Rules of Court.

Legal Reasoning

The Court reiterated the distinction between questions of law and questions of fact and applied the test whether the appellate court could resolve the issue without reviewing evidence. Because the respondents’ notice of appeal and appellate brief raised factual matters, including the date of discovery of the alleged forgery and factual allegations of nonparticipation and deprivation, the Court found that mixed questions were presented and that the ordinary appeal to the CA was proper. On prescription, the Court accepted that when a complaint alleges nullity of an instrument and seeks a declaration of inexistence, Article 1410 renders such action imprescriptible; thus, if the extrajudicial settlement is void ab initio for forgery or absence of consent, prescription does not bar relie

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