Case Summary (A.C. No. 11394)
Key Dates
August 23, 1930 – Execution of deed of donation by Eusebio de Castro and Martina Rieta
April 26, 1962 – Transfer of Archdiocesan properties in Cavite to Imus Diocese
June 30, 1980 – Deed of absolute sale by the Bishop of Imus to the Ignao spouses
November 29, 1984 – Filing of complaint in RTC Imus (Civil Case No. 095-84)
January 31, 1985 – RTC order dismissing complaint on prescription grounds
December 23, 1986 – Court of Appeals decision reinstating the complaint
June 19, 1991 – Supreme Court decision
Applicable Law
1987 Philippine Constitution
Civil Code of the Philippines (Articles 727, 732, 733, 764, 870, 1144)
Relevant jurisprudence on automatic contract revocation and prescription
Factual Background
• Donors (Eusebio de Castro and Martina Rieta) donated Lot No. 626 in Kawit, Cavite, to the Archbishop of Manila, with an express 100-year prohibition on disposal or sale, triggering automatic reversion upon breach.
• In 1962, the property’s administration shifted to the Bishop of Imus.
• In 1980, still within the 100-year prohibition, the Bishop sold the property to the Ignao spouses for ₱114,000, and title was duly issued.
• The donee’s heirs (respondents) sued in 1984 for nullification of the donation, rescission of the sale, reconveyance, and damages.
Procedural History
• RTC dismissed the complaint on January 31, 1985, holding the action for revocation of donation had prescribed under Article 764 of the Civil Code.
• On appeal, the Court of Appeals (Dec. 23, 1986) set aside the dismissal, ruling that automatic-reversion stipulations invoked general ten-year prescription for enforcement of written contracts and thus the action had not prescribed.
• Petitioners sought certiorari relief in the Supreme Court.
Issues Presented
- Whether the action for rescission or revocation of the donation prescribed under Article 764 of the Civil Code.
- Whether the 100-year prohibition on alienation constitutes a valid condition or an undue restriction contrary to public policy, thus affecting the existence of a cause of action.
Supreme Court’s Analysis on Prescription
• Article 764’s four-year prescription applies only to judicial revocation actions where no automatic-reversion clause exists.
• Here, the deed’s express stipulation rendered the donation ipso facto null and void upon breach, obviating the need for judicial declaration of revocation.
• By analogy to contract jurisprudence (Articles 732–733, 1306), enforcement of a written agreement with an express automatic-reversion clause is subject to the general ten-year prescription under Article 1144(1).
• Accordingly, respondents’ action to declare and enforce the reversion had not prescribed.
Supreme Court’s Analysis on Validity of the Prohibitory Condition
• A 100-year prohibition on alienation unduly restricts the donee’s essential attribute of ownership and vi
Case Syllabus (A.C. No. 11394)
Facts
- In August 1930, Eusebio de Castro and Martina Rieta executed a deed of donation in favor of the Roman Catholic Archbishop of Manila covering Lot No. 626, Cadastral Survey of Kawit, Cavite (964 sqm.).
- The donation contained a 100-year prohibition against disposition or sale, with an express stipulation that violation would render the donation ipso facto null and void and cause reversion to the donors’ estate.
- On April 26, 1962, all Archdiocesan properties in Cavite were transferred to the Roman Catholic Bishop of Imus.
- On June 30, 1980, during the 100-year prohibitive period, the Bishop of Imus sold the property to Florencio and Soledad C. Ignao for ₱114,000.
- A new title (TCT No. 115990) issued on November 15, 1980, in the Ignaos’ names.
Procedural History
- November 29, 1984: Private respondents (heirs of the donors) filed Civil Case No. 095-84 in RTC Imus, Cavite, seeking nullification of deed of donation, rescission of sale, reconveyance of property, and damages.
- December 17–19, 1984 & January 9, 1985: Petitioners filed motions to dismiss for lack of capacity, failure to state a cause of action, prescription, and not being real parties in interest.
- January 31, 1985: RTC granted dismissal on the ground of prescription.
- Private respondents appealed to the Court of Appeals.