Case Summary (G.R. No. 193038)
Procedural History
Shirley filed, inter alia, a petition for legal separation and liquidation of community property in RTC Pasig (JDRC No. 2510). The RTC granted legal separation, dissolved and ordered liquidation of the absolute community, and enjoined Rogelio from disposing of community property. Shirley later filed a separate Complaint for Rescission of Sale and Recovery of Property against petitioner and Rogelio in RTC Marikina (Civil Case No. 96-274-MK). The RTC rendered judgment in favor of Shirley ordering rescission insofar as her half-share. The CA affirmed with modification, declaring the deed of sale void in its entirety and ordering reconveyance of the entire property to Shirley and Rogelio, without prejudice to petitioner’s right to recover from Rogelio. Petitioner sought certiorari review before the Supreme Court, raising two assignments of error: (I) that the CA erred in finding petitioner not a purchaser in good faith; and (II) that the CA erred by voiding the deed in its entirety.
Facts Found by the Trial Court and Appellate Court
Before marriage, Shirley (while working abroad) remitted funds used toward acquisition of the house and lot purchased by Rogelio in 1989. Rogelio’s name alone appeared on the TCT issued October 19, 1989. Shirley and Rogelio married on September 1, 1990 and lived in the property. Shirley later discovered Rogelio’s infidelity, filed legal separation (decision dated May 16, 1994) which dissolved the community and enjoined Rogelio from disposing of community property. Despite warnings by Shirley to prospective buyers about pending cases, Rogelio sold the property to petitioner by Deed of Absolute Sale dated December 29, 1992. Petitioner alleged she examined the title and therefore bought in good faith. Evidence at trial included Shirley’s testimony that she warned neighbors (including petitioner’s sister) not to deal with Rogelio; irregularities in the sale documents; and the Pasig RTC decision finding Shirley had contributed to the purchase and that the property formed part of the absolute community.
Legal Issues Presented
- Whether petitioner was a purchaser in good faith such that she could claim indefeasibility against Shirley’s community interest. 2. Whether the Deed of Absolute Sale executed by Rogelio during the subsistence of marriage, without Shirley’s written consent or court authorization, is void in whole or only as to Shirley’s half-share. 3. Whether petitioner is entitled to reimbursement from Shirley for amounts paid.
Governing Legal Standards on Purchaser in Good Faith
An innocent purchaser for value must buy without notice of another person’s right or interest, paying full and fair price at the time of purchase or before receipt of notice. The burden of proving innocent purchaser status rests on the party asserting it; ordinary presumption of good faith is insufficient. The standard requires prudence and due diligence equivalent to what a reasonably prudent person would do: ocular inspection, verification of title and tax declarations at the Register of Deeds, inquiries into occupancy and the seller’s capacity to dispose of the property (including civil status and whether marital consent is required). The Torrens title’s indefeasibility is not absolute where surrounding circumstances should have put a prudent buyer on notice.
Application of Purchaser-in-Good-Faith Standard to the Facts
The Court found multiple circumstances that should have placed petitioner on inquiry: proximity of petitioner’s sister to the subject property and the possibility of direct inquiry; respondent’s credible testimony that she warned neighbors (including petitioner’s sister) against buying; irregularities in the Deed of Absolute Sale (witnesses’ Community Tax Certificates bore dates after the deed’s date); and the omission of the seller’s civil status in the deed despite petitioner’s reliance on the TCT showing Rogelio as “single.” Given these facts, the CA and Supreme Court held it reasonable to infer that petitioner failed to exercise the requisite prudence and due diligence and thus was not an innocent purchaser for value.
Legal Principles on Community Property and Ownership (Family Code)
Article 91 of the Family Code defines community property as all property owned by spouses at the time of marriage or acquired thereafter, except those excluded by Article 92. Article 92 enumerates exceptions (e.g., properties acquired by gratuitous title, property for exclusive personal use, property acquired before marriage by a spouse with legitimate descendants, etc.). The Court emphasized that inclusion in the community is not determined by title name or contribution but by statutory classification; a property not falling within Article 92 exceptions forms part of the absolute community regardless of which spouse’s name appears on the title.
Effect of Sale by One Spouse Without Consent (Article 96)
Article 96 of the Family Code provides that powers of disposition or encumbrance over community property require the written consent of the other spouse or court authorization; absent such consent or authority, the disposition is void. The Court applied this rule to hold that Rogelio’s sale of the entire property during the marriage, without Shirley’s written consent or judicial authorization, rendered the sale void in its entirety, not merely voidable as to Shirley’s half-share. The CA’s modification of the RTC judgment to declare the entire deed null and void was therefore affirmed.
On Reimbursement and the Benefit Requirement (Article 94)
Article 94 limits the absolute community’s liability for debts and obligations contracted by one spouse without the other’s consent to the extent that the family benefited. The Court found no evidence that the proceeds Rogelio received from the sale redounded to the benefit of the family; thus Shirley could not be compelled to reimburse petitioner for amounts paid. The CA’s ruling—allowing petitioner to pursue recourse against Rogelio
Case Syllabus (G.R. No. 193038)
Facts
- Shirley B. Nuega (respondent) and Rogelio A. Nuega were married on September 1, 1990; prior to marriage, while engaged, Shirley worked as a domestic helper in Israel and sent money at Rogelio's request for purchase of a residential lot in Marikina.
- Respondent initially sent US$3,500.00 and later added P50,000.00 (the source describes a total of P150,000.00 in the Folder of Exhibits and related trial testimony).
- On September 13, 1989 Rogelio purchased the subject house and lot for P102,000.00 from Rodeanna Realty Corporation; the property has an aggregate area of 111 square meters and was covered by TCT No. 171963 (Transfer Certificate of Title number references appear in the record).
- TCT No. 171963 was issued on October 19, 1989 solely in the name of Rogelio; Tax Declarations Nos. D-012-04723 and D-012-04724 likewise reflected Rogelio.
- Shirley and Rogelio lived in the subject property after their marriage; Shirley later returned to Israel to work and, while overseas, learned Rogelio had brought another woman (Monica Escobar) into the family home and was introducing her as his wife.
- In June 1992 Shirley filed a criminal complaint for concubinage and a petition for legal separation and liquidation of property before the RTC of Pasig City; she later withdrew and re-filed the legal separation and liquidation petition which was docketed as JDRC Case No. 2510.
- Shirley warned potential buyers, including neighbors, about the existence of the cases she filed against Rogelio and cautioned them not to buy the property until the cases were closed.
- Despite the warnings, Rogelio, by a Deed of Absolute Sale dated December 29, 1992, sold the subject property to Josefina V. Nobleza (petitioner) for P380,000.00; petitioner undertook to assume the existing mortgage with the National Home Mortgage Finance Corporation and to pay real property taxes.
- The Deed of Absolute Sale described the vendee (petitioner) as “single” and did not state the seller’s civil status; the deed bears the date December 29, 1992, while the Community Tax Certificates of the witnesses were dated January 2 and January 20, 1993 — an identified irregularity in the record.
- Shirley instituted a Complaint for Rescission of Sale and Recovery of Property on August 27, 1996 before the RTC of Marikina, Branch 273 (Civil Case No. 96-274-MK).
Procedural History
- The RTC of Pasig (JDRC Case No. 2510) rendered a decision dated May 16, 1994 granting Shirley’s petition for legal separation, ordering dissolution and liquidation of the absolute community, enjoining Rogelio from disposing of community property pending liquidation, and directing Shirley to institute separate action against buyers occupying the property.
- Rogelio appealed the Pasig RTC ruling to the Court of Appeals (CA); the CA denied due course and dismissed the petition, making the Pasig RTC decision final and executory; a writ of execution was issued in August 1995.
- After trial on the merits in RTC Marikina (Civil Case No. 96-274-MK), the trial court rendered a decision on February 14, 2001 ordering: (1) rescission of the Deed of Absolute Sale insofar as 55.05 square meters representing Shirley’s one-half portion, (2) reconveyance of that 55.05 sq. m. or payment of present market value, and (3) payment of attorney’s fees of P20,000.00; defendant’s counterclaim was denied.
- Petitioner appealed to the CA. Rogelio did not appeal the trial court’s ruling.
- The CA, in a Decision dated May 14, 2010, affirmed with modification: declared the Deed of Absolute Sale dated December 29, 1992 null and void in its entirety and ordered petitioner to reconvey the entire subject property to Shirley and Rogelio, without prejudice to petitioner’s right to recover from Rogelio whatever amount she paid for the subject property; costs were imposed against petitioner.
- Petitioner moved for reconsideration; the CA denied the motion in a Resolution dated July 21, 2010.
- Petitioner filed a petition for review on certiorari to the Supreme Court raising two assignments of error: (I) CA erred finding petitioner was not a purchaser in good faith; (II) CA erred by modifying the trial court’s decision to declare the Deed of Absolute Sale void in its entirety.
- The Supreme Court, in a Decision dated March 11, 2015 (G.R. No. 193038), denied the petition for review and affirmed the CA Decision and Resolution; costs were imposed against petitioner. The panel opinion was penned by Villarama, Jr., J., with Velasco, Jr. (Chairperson), Peralta, Reyes, and Jardeleza, JJ., concurring.
Issues Presented on Appeal
- Whether the Court of Appeals erred in sustaining the trial court’s finding that petitioner was not a purchaser in good faith.
- Whether the Court of Appeals erred in modifying the trial court’s decision by declaring the Deed of Absolute Sale dated December 29, 1992 null and void in its entirety.
Trial Court Ruling (RTC, Feb 14, 2001)
- Rescinded the Deed of Absolute Sale only insofar as 55.05 square meters representing Shirley’s one-half portion, declaring that portion null and void.
- Ordered petitioner Josefina V. Nobleza to reconvey said 55.05 square meters to Shirley or alternatively to pay the present market value of that portion.
- Awarded attorney’s fees to Shirley in the sum of P20,000.00.
- Denied defendant’s counterclaim for lack of merit.
Court of Appeals Ruling (May 14, 2010) and Resolution (July 21, 2010)
- Affirmed the trial court’s decision with modification: declared the Deed of Absolute Sale dated December 29, 1992 null and void in its entirety (not only as to Shirley’s one-half portion).
- Ordered defendant-appellant Josefina V. Nobleza to reconvey the entire subject property to plaintiff-appellee Shirley B. Nuega and defendant Rogelio Nuega.
- Held petitioner’s remedy was to recover from Rogelio whatever she paid for the subject property, if any such right existed.
- Imposed costs against petitioner.
- Denied petitioner’s motion for reconsideration for lack o