Title
Tigno vs. Court of Appeals
Case
G.R. No. 110115
Decision Date
Oct 8, 1997
Dispute over land ownership in Lingayen, Pangasinan; implied trust established between brothers, with Eduardo as beneficiary. Casipits not purchasers in good faith; sale annulled.
ownership dispute
parcels of land
fraudulent sale
A

Case Summary (G.R. No. 110115)

Factual Background

In January 1980, Bienvenido Sison, Remedios Sison, and the heirs of Isaac Sison, namely Manuel Sison, Gerardo Sison, and Adelaida Sison, appointed Dominador Cruz as agent to sell three parcels of land adjoining each other in Lingayen, Pangasinan. The parcels included (a) a fishpond owned by Bienvenido Sison with an area of 3006.67 square meters, (b) a fishpond owned by the heirs of Isaac Sison with an area of 3006.66 square meters, and (c) an unirrigated riceland (later fishpond) owned by Remedios Sison also with an area of 3006.66 square meters.

In April 1980, Rodolfo Tigno learned that the parcels were for sale and approached Cruz to offer them to his brother, Eduardo Tigno. Cruz and Rodolfo then convinced Eduardo in Rodolfo’s favor. During the meeting between Cruz and Eduardo, the agreed price was P10,000.00 per parcel. Eduardo instructed Cruz to bring the property owners to his ancestral house on May 2, 1980 for preparation of the deeds of sale so Eduardo could attend a fiesta.

On May 2, 1980, the parties proceeded to the house of Atty. Modesto Manuel for deed preparation. However, Bienvenido Sison failed to produce the necessary tax declarations, Remedios Sison had already mortgaged her property to a certain Mr. Tuliao, and Manuel Sison allegedly lacked a required Special Power of Attorney from his sister abroad. No deed was thus prepared that day. Despite these defects, the vendors asked Eduardo to pay a fifty percent (50%) downpayment. Eduardo acceded and paid P5,000.00 each to the three vendors, totaling P15,000.00, witnessed by Cruz and Atty. Manuel. Eduardo then instructed Cruz and Atty. Manuel to place Rodolfo’s name as vendee in the deeds to be subsequently prepared, so Rodolfo could mortgage the properties with the Philippine National Bank (PNB), Lingayen Branch, for funds to develop the fishponds.

The deeds of sale were later prepared and signed by the respective vendors on May 6, 1980, May 12, 1980, and June 12, 1980, with Rodolfo named as vendee in all three deeds and Cruz signing as witness. In the second week of July 1980, Cruz showed the deeds to Eduardo in Makati, and Eduardo issued a Pacific Bank check amounting to P26,000.00, broken down as P15,000.00 as the balance for the parcels, P6,000.00 for Cruz’s commission, and P5,000.00 for capital gains tax, registration, and incidental expenses. After the check was encashed at PNB, Cruz paid the vendors the remaining balance.

Subsequently, on April 29, 1989, without Eduardo’s knowledge or consent, Rodolfo sold 508.56 square meters of the property previously owned by Bienvenido Sison to Spouses Edualino Casipit and Avelina Estrada. At the time of sale, the Casipits were aware that the portion they bought belonged to Eduardo and not to Rodolfo. Eduardo learned of Rodolfo’s negotiations and sent a letter dated May 16, 1989 to the Casipits advising them to desist from the intended sale, only to find out that the sale had already been consummated on April 29, 1989. Eduardo then confronted Rodolfo and the Casipits to annul the sale, but his requests were refused.

Initiation of the Trial Court Action

On May 24, 1989, Eduardo filed Civil Case No. 16673 for reconveyance, annulment of document, recovery of possession, and damages against Rodolfo and the Casipits. Eduardo alleged that he purchased the properties so that Rodolfo, who was then jobless, could have income as caretaker of the fishponds. He further alleged that he and Rodolfo agreed that Rodolfo would secure a loan from PNB using the lands as collateral, and that due to Eduardo’s busy schedule as an executive in Makati, it was agreed that Rodolfo would appear as vendee in the deeds solely to enable him to obtain the loan without Eduardo’s personal presence or signature. Eduardo claimed that because of the trust and confidence between the brothers, he directed the notary who prepared the deeds to place Rodolfo’s name as vendee. Eduardo maintained that Rodolfo’s subsequent sale of the portion to the Casipits violated that trust.

Rodolfo and the Casipits denied the allegations. Rodolfo asserted ownership based on the deeds and legal compliance, and that he was merely exercising his right to dispose as owner. The Casipits alleged that they acquired the portion in good faith and for value, relying on the validity of Rodolfo’s ownership.

After trial, the Regional Trial Court dismissed Eduardo’s complaint for lack of factual and legal basis and ordered Eduardo to pay attorney’s fees and costs.

Court of Appeals Proceedings and Reversal

On appeal, the Court of Appeals reversed the trial court. It ordered that Eduardo be declared the true and lawful owner of the lands described in the complaint, declared the deed of sale executed by Rodolfo in favor of the Casipits void and of no effect, and directed Rodolfo to vacate and surrender possession to Eduardo. The Court of Appeals also denied petitioners’ motion for reconsideration for lack of merit.

Issues Raised by Petitioners

Petitioners contended, in substance, that the evidence established the propriety of Rodolfo’s payments and the authenticity of receipts and documents showing Rodolfo as buyer; that documents and circumstances substantiated Rodolfo’s ownership; and that no fiduciary relationship or trust existed between the brothers. They also maintained that the Casipits were purchasers in good faith and for value.

The Court treated the petition as largely raising an issue of whether the evidence proved an implied trust between Rodolfo and Eduardo, and whether the Casipits could acquire ownership over the disputed portion despite Rodolfo’s apparent title.

Legal Basis and Reasoning on Implied Trust

The Court recognized that under Rule 45, review normally covers questions of law only, and it does not pass upon factual findings. However, the Court adopted an exception because of a conflict between the trial court’s and the Court of Appeals’ factual determinations.

In addressing implied trusts, the Court reiterated that implied trusts are deduced by operation of law from the nature of the transaction and from equity, independent of the parties’ specific intention. It explained the general rule for resulting trusts where a person purchases land with his own money and causes conveyance in the name of another. In such situations, the property is held in a resulting trust in favor of the person who furnished the consideration, unless a different intention appears.

The Court relied on Article 1448 of the Civil Code, which provides that an implied trust arises when property is sold and legal estate is granted to one party, but the price is paid by another for the purpose of having beneficial interest. It stressed that the purchase-money resulting trust depends on proof of actual payment of valuable consideration by the beneficiary and that the beneficiary furnished the consideration. It also reiterated the controlling principles on the burden of proof: the party asserting a trust must prove it clearly and satisfactorily, and while implied trusts may be proven by oral evidence, the evidence must be trustworthy and received with extreme caution, since oral evidence is susceptible to fabrication.

On the factual controversy over authenticity and evidentiary weight, petitioners insisted that Exhibit 16 and Exhibit 17 were authenticated through Cruz and thus established Rodolfo as vendee. The Court rejected the contention. It pointed out that Cruz did not authenticate the genuineness of Exhibit 16; it was only a xerox copy, and the other exhibit did not establish that Rodolfo paid the balance of purchase price. Moreover, the Court treated Cruz’s testimony as consistent in the material point that the true buyer was Eduardo, even if Eduardo was not the named vendee in the deeds or receipts. Cruz testified that Eduardo instructed him to place Rodolfo’s name in the deeds to enable Rodolfo to mortgage the properties with PNB, and Cruz also explained the parties’ reliance on trust and confidence between the brothers. The Court also credited the testimony of Atty. Modesto Manuel, the deed preparer and notary, who affirmed the “unwritten agreement” and explained why Eduardo requested Rodolfo to appear as vendee: to use the properties as collateral for a possible PNB loan, given Eduardo’s absence from Lingayen and his busy work and subsequent departure abroad. Manuel testified that Eduardo initially was agreeable to executing a special power of attorney but ultimately instructed that Rodolfo be named as vendee because the documents would take time and Eduardo would be abroad.

The Court concluded that Rodolfo’s name appeared in the deeds not to transfer true ownership but only to enable Rodolfo to hold the properties in trust for Eduardo. It further held that the probative value of tax declarations and tax payments in Rodolfo’s name was minimal to prove ownership, consistent with doctrine that tax declarations and payments are not conclusive proof of ownership. The Court also found no improper delay on Eduardo’s part. It noted that Eduardo, upon learning from relatives that Rodolfo was negotiating the sale, immediately wrote the Casipits on May 16, 1989, confronted Edualino on May 18, 1989, and filed the case on May 24, 1989, only five days after learning of the consummation.

Applying Article 1448, the Court agreed with the Court of Appeals that an implied trust existed in favor of Eduardo. It held that Eduardo supplied the consideration by paying P5,000.00 each as downpayment and later issuing a check for P26,000.00 representing the balance, commission, and expenses. It found that Rodolfo failed to substantiate his claim that he purchased with his own money or with funds borrowed from Jose Manaoat, since Rodolfo did not present Manaoat and did not offer corroborative evidence of his alleged in

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