G.R. No. L-7651. February 28, 1955

The case. This is an appeal from an order of the Court of First
Instance of Rizal dismissing the plaintiffs’ complaint on the ground.of
prescription.

The order having been issued upon a motion to dismiss, the relevant facts are
those alleged in the complaint, to wit:

The facts. 1. The plaintiffs were, in August 1931, the registered
owners of a parcel of land, (with building) in Pasig, Rizal (Certificate of
Title No. 3199) which was mortgaged to Macondray & Company in the sum of
P3,000;

2. In said month they agreed with defendant Felisa A. Afable that the latter
would repay the loan to Macondray & Company and would be subrogated to that
company’s rights as mortgagee;

3. However, abusing their confidence, Felisa A. Afable made them sign a
document of absolute sale of the property —instead of a mere transfer of
mortgage;

4. And on the strength of said deed of sale, Felisa A. Afable obtained the
cancellation by the Register of Deeds of Rizal of said certificate No. 3199 and
the issuance of a Transfer Certificate of Title No. 20666 in her name in
November, 1931;

5. In June 1945 plaintiffs learned for the first time that the document they
had signed in August 1931 was a document of sale, instead of a mortgage
subrogation;

6. In October 1945, Felisa A. Afable sold the realty to Braulio Santos, who
in due course obtained Transfer Certificate of Title No. 48261.

Lower court’s view. Observing that the complaint in this case was
dated August 29, 1953, His Honor declared the action had already prescribed,
because actions for relief on the ground of fraud may only be brought within
four years from the discovery of the fraud, (Section 43 Act No. 190)
which plaintiffs say took place in June 1945.

Meeting plaintiffs’ argument that the action could be filed within ten
years from June 1945 because it purported to recover title to realty, the
appealed order applied our decision in Rone et al. vs. Claro and
Baquing, (91 Phil., 251) wherein, in a similar case, we stated the
following:

“Appellants however now insist that their action was not to annul the deed of
sale on the basis of fraud, but to recover title and possession of land.” * *
*

“Then among the prayers for relief, is one asking that the deed of sale be
declared fraudulent. Another prayer is that defendants be ordered to execute a
deed of conveyance of the lot in favor of plaintiffs, meaning that at present,
defendants are owners of the lot, tho by virtue of a supposed fraudulent deed.
From all this, it is obvious, as already stated, that the action was for the
annulment of a contract or deed an the ground of fraud, which action should be
filed within four years after the discovery of the fraud.” * * *

“It may be that the recovery of title and possession of the lot was the
ultimate objective of plaintiffs, but to attain that goal, they must need
first travel over the road of relief on the ground of fraud; otherwise even
if the present action were to be regarded as a direct action to recover title
and possession, it would, nevertheless, be futile and could not prosper for the
reason that the defendants could always defeat it by merely presenting the deed
of sale, which is good and valid to legalize and justify the transfer of the
land to the defendants, until annulled by the courts.”

Our opinion. Upon careful consideration we see no reason to reverse
the appealed order on the ground of misapplication of the aforesaid ruling. In
fact, in view of the issuance of certificates of title, another line of approach
conclusive against plaintiffs’ side suggests itself: There being no allegation
of bad faith against Santos, his purchase of the duly registered title of Afable
may not be revoked even if Afable, as alleged in the complaint, obtained it thru
fraud.^[1] Consequently plantiffs’ action
for annulment of the deed of sale will necessarily fail. Plaintiffs’ remedy if
any is an action for damages against Afable by reason of fraud, and that remedy
may only be demanded judicially within four years after discovery of the
deception. (Sec. 43 Art. No. 190)

But, the plaintiffs contend, such period was interrupted by the pendency of
the case instituted by Braulio Santos in October 1946 to eject plaintiffs from
the real property in question. Indeed there was such litigation that, passing
thru the court of first instance and the court of appeals was finally decided by
this Supreme Court in June 1953. The plaintiffs cite Article 1973 of the Civil
Code providing that “the prescription of actions is interrupted by the
commencement of a suit for their enforcement * * *”. Their contention is plainly
unmeritorious, because the case mentioned was not a suit for the enforcement of
the rights of herein plaintiffs. These were defendants there. And there is no
proof nor allegation that in said rase the defendants had demanded the relief
they now seek. Anyway, it should be observed that said litigation at most
suspended the action against Santos only—not Afable; yet, as heretofore
explained, action against Santos may not prosper, not only by reason of
prescription, but by reason of his having purchased in good faith from one
having a duly registered certificate of title No. 20666.

Judgment. The appealed order of dismissal should be, and is hereby
affirmed with costs. So ordered.

Paras, C.J., Pablo, Padilla, Montemayor, Reyes, A., Jugo, Bautista
Angelo, Labrador Concepcion and Reyes J.B.L., JJ., concur.

Order affirmed.

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^[1] Section 55 Land Registration Act;
De la Cruz vs. Fabie, 35 Phil., 144; Blondeau vs. Nano, 61
Phil., 625; Jacinto vs. Arellano, 46 Phil., 570.