G.R. No. 165088 - Ramirez vs. Ramirez

Case Summary (G.R. No. 165088)

Key Dates and Document Dates

Petition filed in the RTC: October 8, 1996. Deed of Donation execution date alleged: January 29, 1993. Waiver of Possessory Rights execution date alleged: October 24, 1995. Death of Dolores Ramirez (per death certificate): April 5, 1991. (The Supreme Court decision date is outside this header per instructions.)

Factual Background

Petitioner alleged that respondent caused the preparation and execution of a Deed of Donation and a Waiver of Possessory Rights that purportedly transferred ownership and possessory interests in the subject land and improvements to respondent. Petitioner asserted that Dolores had died in 1991 and therefore could not have executed the instruments dated 1993 and 1995; petitioner repudiated signatures ascribed to both Dolores and himself, asserting lack of intent to transfer the properties. Respondent claimed that petitioner was complicit, that the documents were prepared to save on publication and inheritance taxes, and that petitioner supported the measures, alleging that petitioner would not have filed suit but for family estrangement.

Procedural History and Trial Findings

At trial, the RTC found Dolores’s signature on the Deed of Donation to be a forgery, while concluding that her signature on the Waiver of Possessory Rights was genuine; the RTC also found petitioner’s signatures on both instruments to be genuine. The RTC applied Article 1412 of the Civil Code and held petitioner and respondent in pari delicto, dismissing the complaint. On appeal, the Court of Appeals found that Dolores’s signature on both the Deed of Donation and the Waiver of Possessory Rights were forgeries, and it likewise held both parties in pari delicto, denying petitioner’s petition for annulment.

Issue Presented

Whether petitioner and respondent are in pari delicto such that neither may obtain judicial relief against the other for the annulment of the Deed of Donation, the Waiver of Possessory Rights, and the transfer-related titles and tax declarations.

Governing Legal Principles

Donations inter vivos are governed by Title 3, Book III of the Civil Code, and by the general provisions on obligations and contracts insofar as the donation title is silent (Article 732). The civil doctrine of pari delicto governs the legal consequences when contracting parties share fault in an unlawful transaction. Two Civil Code provisions are relevant: Article 1412, applicable when the cause of the contract is unlawful but does not constitute a criminal offense; and Article 1411, applicable when the nullity of the contract arises from an illegal cause or object and the act involved constitutes a criminal offense (in which case both parties in pari delicto shall have no action against each other and both may be prosecuted). Forgery (falsification) of signatures corresponds to a criminal offense under Section 4, Title IV of the Revised Penal Code; thus, where forgery is present, Article 1411 is the pertinent provision.

Court’s Legal Analysis and Application to Facts

The Court accepted that forging Dolores’s signature constituted forgery (a criminal falsification) and therefore that the act involved was criminal in character, bringing Article 1411 into play rather than Article 1412. The Court then examined whether the nullity of the instruments proceeded from an illegal cause or object. It distinguished object (the subject matter of the donation — the properties, which were legally capable of being donated) from cause (the essential reason or motive prompting execution of the instruments). The Court found the cause to be illegal: the immediate, direct, and proximate motive behind the instruments was to evade publication expenses and inheritance taxes that arose upon Dolores’s death. Because the cause (motive) was illegal and

Case Syllabus (G.R. No. 165088)

Case Citation and Procedural Posture

Supreme Court decision: 519 Phil. 775, Second Division, G.R. No. 165088, March 17, 2006.
Petition for review on certiorari filed under Rule 45 of the Rules of Court by petitioner Potenciano Ramirez.
Case docket in trial court: Civil Case No. 329-0-96; original complaint filed October 8, 1996, before the Regional Trial Court (RTC) of Olongapo City.
Appeal taken to the Court of Appeals (CA) in CA-G.R. No. 69401; decision of the CA is the subject of the present petition.
Decision authored by Justice Azcuna; concurrence by Puno (Chairperson), Sandoval-Gutierrez, Corona, and Garcia, JJ.
Final disposition at the Supreme Court: petition DENIED; no pronouncement as to costs.

Parties and Titles of Relevant Documents

Petitioner: Potenciano Ramirez.
Respondent: Ma. Cecilia Ramirez.
Documents challenged by petitioner: Deed of Donation; Waiver of Possessory Rights; Transfer Certificates of Title (TCT) Nos. T-5618 and T-5617.
Original titles and alleged replacements: properties allegedly then covered by TCT Nos. T-4575 and T-4576 purportedly cancelled and replaced by TCT Nos. T-5618 and T-5617 in respondent’s name.
Property described in pleadings: includes a one-storey commercial building (identified in the source material).

Material Facts

Petitioner alleged respondent caused execution of a Deed of Donation and a Waiver of Possessory Rights to acquire ownership of land and improvements then covered by TCT Nos. T-4575 and T-4576.
Using the Deed of Donation, respondent allegedly succeeded in having TCT Nos. T-4575 and T-4576 cancelled and TCT Nos. T-5618 and T-5617 issued in her name.
With the Waiver of Possessory Rights, respondent allegedly caused the Office of the City Assessor to transfer to her name the tax declarations on the improvements.
Petitioner alleged the Deed of Donation was executed on January 29, 1993, and the Waiver of Possessory Rights on October 24, 1995.
Petitioner presented a death certificate showing Dolores Ramirez (petitioner’s wife) died on April 5, 1991, thereby contending she could not have executed the challenged documents dated 1993 and 1995.
Petitioner repudiated signatures purportedly his on the two documents and insisted he did not intend to transfer the properties to respondent.
Respondent’s Answer averred that petitioner would not have filed the case were it not for petitioner’s remarriage at age 84, and that it was petitioner’s idea to prepare the Deed of Donation and Waiver of Possessory Rights to save on publication expenses and inheritance taxes.

Findings and Rulings of the Regional Trial Court (RTC)

RTC findings on signatures:
- Dolores’s signature on the Deed of Donation: forged.
- Dolores’s signature on the Waiver of Possessory Rights: genuine.
- Petitioner’s signatures on both documents: genuine.
RTC legal conclusion: petitioner and respondent were in pari delicto as participants to the forgery.
RTC applied Article 1412 of the Civil Code (the rule for unlawful or forbidden cause not constituting a criminal offense).
RTC ruling on relief: parties must bear consequences of their acts and have no cause of action against each other under Article 1412; complaint dismissed.

Findings and Rulings of the Court of Appeals (CA)

CA held that Dolores’s signature on both the Deed of Donation and the Waiver of Possessory Rights were forgeries.
CA denied petiti