Case Summary (G.R. No. 116033)
Procedural History
Private respondents (Generosa and Braulio) filed an action for specific performance of an alleged deed of sale against Fortunato and Perpetua Ape (petitioners). The trial court dismissed both the complaint and counterclaim and ordered registration and annotation of deeds conveying shares sold by other co‑owners. The Court of Appeals reversed the trial court insofar as it dismissed the complaint and ordered petitioners (or successors) to execute a deed of absolute sale for Fortunato’s 1/11 share, but it affirmed dismissal of the counterclaim on redemption grounds. The Supreme Court reviewed the appellate decision by certiorari.
Core Factual Allegations
Private respondent alleged that on April 11, 1971 she and Fortunato agreed to a sale of Fortunato’s 1/11 share in Lot No. 2319 for P5,000, evidenced by a receipt (marked Exhibit G) showing a P30 advance. She sought a registrable deed of sale and performance remedies. Petitioners denied the sale, asserted forgery, and counterclaimed that a prior lease (commencing 1960) existed and that they had a right of redemption over shares sold by other co‑owners. Private respondents also produced numerous written instruments evidencing purchases of other heirs’ shares, an annotation of an adverse claim on the title (dated June 22, 1967), photographs, and a survey said to show separate portions within Lot No. 2319; testimony indicated that Fortunato had possessed a specific portion of the lot. Fortunato died during proceedings and his children were substituted.
Trial Court Findings
The trial court dismissed both the complaint for specific performance and the counterclaim. It found private respondent did not prove payment of the P5,000 purchase price to Fortunato and applied Article 1350 to deny specific performance. On the counterclaim, the trial court concluded that petitioners had or acquired knowledge of the sales of co‑owners’ shares early enough to trigger the 30‑day redemption period and therefore had lost the right of legal redemption.
Court of Appeals Holding
The Court of Appeals reversed the trial court’s dismissal of private respondent’s complaint, concluding Exhibit G bore the earmarks of a valid contract of sale and that the vendee’s advance payment entitled her to compel execution of the final deed; it held that the vendee need not deposit the unpaid balance in court prior to enforcement. The appellate court ordered petitioners (or their successors) to execute a deed of absolute sale for Fortunato’s 1/11 share (12,527.19 sq. m.) within 30 days or authorized the trial court clerk to execute it on the vendor’s behalf. The Court of Appeals, however, affirmed dismissal of petitioners’ counterclaim, reasoning that delivery to Fortunato of a second owner’s duplicate of the OCT containing the adverse claim constituted sufficient compliance with the written‑notice requirement under Article 1623 and that the redemption period had lapsed.
Issues Presented on Review
Petitioner principally advanced two issues: (1) whether Fortunato and his successors received the written notice required by Article 1623 of the Civil Code to start the 30‑day redemption period; and (2) whether the April 11, 1971 receipt (Exhibit G) established a binding contract of sale, given alleged defects including lack of agreement on manner of payment, the vendor’s illiteracy, and that only a photocopy of the exhibit was offered.
Legal Analysis — Article 1623 and Written Notice
Article 1623 prescribes that the right of legal redemption must be exercised within thirty days from "the notice in writing by the prospective vendor, or by the vendor." The Court reviewed jurisprudence interpreting the statutory written‑notice requirement. Earlier decisions emphasized that the notice must come from the vendor (Butte v. Manuel Uy & Sons) to remove doubt and to identify co‑owners; later cases softened the means of notice so long as the redeeming co‑owner was notified in writing of the sale’s particulars (De Conejero and subsequent cases). The Court found no record evidence that Fortunato received a written notice from any vendor. Consequently, the statutory 30‑day redemption period had not, as a legal matter, commenced under Article 1623.
Legal Analysis — Effect of Partition on Right of Redemption
Notwithstanding the foregoing, the Court held petitioners could not invoke a right of legal redemption because the factual prerequisite of co‑ownership no longer existed at the time of the challenged conveyances. Legal redemption presupposes an existing regime of co‑ownership. The Court found the heirs had effectively partitioned Lot No. 2319 in practice (hantal‑hantala or de facto partition): specific portions were possessed, farmed, and demarcated by stakes and plantings, and parties admitted at pre‑trial that Fortunato had possessed a specific portion. An informal or oral partition is valid and, once the property has been subdivided and distributed among co‑owners, the community of ownership ceases and the statutory right of redemption is inapplicable. Based on these findings, the Court ruled that petitioners had no right of redemption.
Legal Analysis — Existence and Validity of the Contract of Sale (Exhibit G)
A contract of sale in Philippine law is consensual and requires concurrence of minds on object and price, with consent being intelligent, free and spontaneous. The Court reiterated that a party alleging fraud or mistake bears the burden of proof, but under Article 1332 a party enforcing a contract against an illiterate person must prove that the terms were fully explained to that person. The evidence showed Fortunato was illiterate and that the receipt (Exhibit G) was prepared in English by Andres Flores, who admitted he did not ensure an independent, competent witness read or explained the document to Fortunato and did not take steps to have its terms explained because he considered it a small receipt. Flores’ testimony undermined private respondent’s claim that the terms were explained. The Court concluded private respondent failed to meet her burden under Article 1332; Fortunato’s consent was thus vitiated, and the alleged contract of sale could not be enforced.
Burden of Proof, Payment, and the Trial Court’s Application of Article 1350
The trial court had applied Article 1350 in concluding pri
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Case Caption and Procedural Posture
- Petition for review on certiorari to the Supreme Court from a Decision of the Court of Appeals in CA-G.R. CV No. 45886.
- Case styled in the Court of Appeals as "Generosa Cawit de Lumayno, accompanied by her husband Braulio Lumayno v. Fortunato Ape, including his wife Perpetua de Ape."
- Trial court: Court of First Instance (Regional Trial Court), Branch 58, San Carlos City, Negros Occidental.
- Trial court rendered decision dated 11 March 1994 dismissing both the complaint and the counterclaim; Court of Appeals reversed insofar as dismissal of plaintiffs-appellants’ complaint and affirmed dismissal of defendants-appellants’ counterclaim (decision dated 25 March 1998).
- Petitioners (Perpetua de Ape and children as successors) filed for review in the Supreme Court contesting the Court of Appeals’ ruling that ordered specific performance of an alleged sale by Fortunato and/or compelled execution of a deed by the Clerk of Court in case of noncompliance; also contesting the appellate court’s treatment of Article 1623 redemption notice requirements and evidentiary issues.
- Supreme Court decision authored by Justice Chico-Nazario, reversing the Court of Appeals and reinstating the trial court decision dismissing both complaint and counterclaim; concurrence by Puno (Chairman), Austria-Martinez, Callejo, Sr., and Tinga, JJ.; no costs.
Relevant Parties and Succession
- Original registered owner of Lot No. 2319: Cleopas Ape, covered by Original Certificate of Title (OCT) No. RP 1379 (RP-154 [300]).
- Upon Cleopas Ape’s death circa 1950, property passed to his wife Maria Ondoy and their eleven children: Fortunato, Cornelio, Bernalda, Bienvenido, Encarnacion, Loreta, Lourdes, Felicidad, Adela, Dominador, and Angelina (all surnamed Ape).
- Plaintiffs in the original action: Generosa Cawit de Lumayno and her husband Braulio Lumayno (Braulio later died on 14 October 1988).
- Defendants: Fortunato Ape and his wife Perpetua de Ape; after Fortunato’s death, he was substituted by his children named Salodada, Clarita, Narciso, Romeo, Rodrigo, Marieta, Fortunato, Jr., and Salvador, all surnamed Ape.
Factual Background (material facts as pleaded and testified)
- Plaintiffs alleged that on 11 April 1971 Generosa and Fortunato entered a contract of sale for Fortunato’s one-eleventh (1/11) share in Lot No. 2319 for P5,000.00, evidenced by a receipt prepared by Generosa’s son-in-law Andres Flores and attached to the complaint as Annex “A”, later marked Exhibit “G” for plaintiffs.
- Text of the receipt (as introduced in evidence):
- Dated April 11, 1971
- “TO WHOM IT MAY CONCERN: This date received from Mrs. Generosa Cawit de Lumayno the sum of THIRTY PESOS ONLY as Advance Payment of my share in Land Purchased, for FIVE THOUSAND PESOS a LOT #2319. (Signed) FORTUNATO APE P30.00 WITNESS: (Illegible)”
- Plaintiffs alleged they demanded execution of a registrable deed of sale and payment of the balance; Fortunato allegedly refused, prompting suit for specific performance with damages and other reliefs.
- Defendants denied sale and alleged signature on the receipt was forged; by counterclaim, defendants alleged an earlier lease contract (commencing 1960, supposed to last until 1965 with option for another five years) between Fortunato and plaintiffs, with annual rent of P100.00 paid in installments; defendants claimed right to redeem shares that plaintiffs acquired from other co-owners.
- Plaintiffs offered evidence of purchases of shares from Fortunato’s co-owners and had their husband Braulio annotate an adverse claim on the certificate of title of Lot No. 2319 (Entry No. 123539; adverse claim filed by Braulio Lumayno dated June 22, 1967, affecting aggregate area 77,511.93 square meters).
- Plaintiffs testified the whole lot was surveyed by Oscar Mascada producing a technical description; plaintiffs presented photographs showing a row of banana plants purportedly bounding Fortunato’s portion and separating it from the rest of Lot No. 2319.
- Plaintiffs’ account of the alleged sale: Fortunato allegedly approached Generosa at her store when lease was expiring, demanded rental, and agreed to sell his portion for P5,000.00; Generosa asked son-in-law Andres Flores to prepare the receipt; Flores read the document to Fortunato who then signed it.
- Defendants’ testimony included:
- Petitioners maintained Lot No. 2319 had not been formally subdivided.
- On 11 April 1971, Perpetua and husband went to Generosa’s house to collect past rentals, collected only thirty pesos, and Generosa made Perpetua’s husband sign a receipt acknowledging the amount; contents were not explained to them.
- Fortunato was illiterate and only could sign his name for employment purposes; petitioner and family denied receipt of notices of the sales by co-owners to plaintiffs.
- Testimony corroborated by daughter-in-law Marietta Ape Dino.
- Andres Flores’ trial testimony: he prepared the receipt in English, knew Fortunato could not read or write English, did not request an independent witness who could read English, and considered the receipt trivial because it involved only thirty pesos.
Pleadings, Reliefs Sought, and Trial Court Findings
- Plaintiffs sought:
- Specific performance requiring execution by Fortunato of a sufficient and registrable deed of sale for his 1/11 share of Lot No. 2319;
- P5,000.00 in damages; reimbursement for litigation expenses and costs; P2,000.00 attorney’s fees; and additional sums for appeals.
- Defendants sought annulment of alleged lease, declaration of right of redemption under Article 1623, attorney’s fees, moral and exemplary damages under counterclaim.
- Trial court’s disposition (decision dated 11 March 1994):
- Dismissed both the complaint and the counterclaim.
- Ordered that deeds or documents representing the sales of the shares previously owned by Fortunato’s co-owners be registered and annotated on the existing certificate of title of Lot No. 2319.
- Reasoning on plaintiffs’ complaint: plaintiffs failed to prove payment of the purchase price of P5,000.00 to Fortunato; application of Article 1350 Civil Code led to conclusion plaintiffs had no right to demand registrable deed of sale from Fortunato.
- Reasoning on defendants’ counterclaim (redemption right): trial court found defendants were informed of the sales upon filing of complaint on March 14, 1973, and had presented copies of deeds of sale as their own exhibits when they eventually offered them in evidence (January 2, 1992), meaning they had actual knowledge and the 30-day redemption period under Article 1623 had lapsed.
Court of Appeals Ruling (dispositive and key findings)
- Court of Appeals reversed trial court insofar as dismissal of plaintiffs-appellants’ complaint and ordered:
- Defendants (Fortunato and/or his wife Perpetua and successors-in-interest) to execute in favor of Generosa a Deed of Absolute Sale for Fortunato’s one-eleventh (1/11) share (12,527.19 square meters, more or less) within 30 days from finality of the decision.
- In case of non-compliance, the Clerk of Court of the trial court was ordered to execute the deed on behalf of the vendor.
- Court of Appeals affirmed the trial court’s dismissal of defendants-appellants’ counterclaim (i.e., rejection of their redemption claim).
- Appellate court’s basis for enforcing the receipt (Exhibit “G”):
- Held Exhibit G bore earmarks of a valid contract of sale; advance payment of P30.00 sufficed to bind vendor to execute final deed and the vendee was not required to tender o