G.R. No. 57757. August 31, 1987
PHILIPPINE NATIONAL BANK, PETITIONER, VS. THE HONORABLE COURT OF APPEALS, PRAGMACIO VITUG AND MAXIMO VITUG, RESPONDENTS.
GANCAYCO, J.:
Does the presumption of conjugality
of properties acquired by the spouses during coverture
provided for in Article 160 of the Civil Code apply to property covered by a Torrens
certificate of title in the name of the widow?
This is the issue posed in this petition to review on certiorari
of the decision of the Court of Appeals in CA-G.R. No. 60903 which is an action for reconveyance and damages.*
On November 28, 1952, Donata Montemayor, through her
son, Salvador M. Vitug, mortgaged to the Philippine
National Bank (PNB) several parcels of land covered by Transfer Certificate
of Title (TCT) No. 2289-Pampanga to guarantee the loan granted by the PNB to
Salvador Jaramilla and Pedro Bacani
in the amount of P40,900.00 which was duly registered in the Office of the
Register of Deeds of Pampanga.[1]
On December 1, 1963,
Donata Montemayor also
mortgaged in favor of PNB certain properties covered by TCT Nos. 2887 and
2888-Pampanga to guarantee the payment of the loan account of her son Salvador Vitug in the amount of P35,200.00, which mortgage was duly
registered in the Register of Deeds of Pampanga.[2]
The above-mentioned Transfer Certificates of Titles covering said
properties were all in the name of Donata Montemayor, of legal age, Filipino, widow and a resident of
Lubao, Pampanga at the time
they were mortgaged to PNB[3]
and were free from all liens and encumbramces.[4]
Salvador Vitug failed to pay his
account so the bank foreclosed the mortgaged properties covered by TCT Nos.
2887 and 2888. They were sold at public
auction on May 20, 1968 in
which the PNB was the highest bidder.
The titles thereto were thereafter consolidated in the name of PNB.
Likewise, Salvador Jaramilla and Pedro Bacani failed to settle their accounts with the PNB so the latter foreclosed the
properties covered by TCT No. 2889 which were sold at public auction and
likewise PNB was the buyer thereof. On August
30, 1968, a certificate of sale was issued by the Register of Deeds covering said
properties in favor of the PNB. When the
title of the PNB was consolidated a new title was issued in its name.[5]
On September
2, 1969, the PNB
sold the properties covered by TCT Nos. 2887 and 2888-Pampanga to Jesus M. Vitug, Anunciacion V. de Guzman, Prudencia V. Fajardo, Salvador Vitug and Aurora V. Gutierrez in whose names the
corresponding titles were issued.[6]
During the lifetime of Clodualdo Vitug he married two
times. His first wife was Gervacia Flores with whom he had 3 children, namely,
Victor, Lucina and Julio all surnamed Vitug. Victor now
dead is survived by his 5 children:
Leonardo, Juan, Candido, Francisco and Donaciano, all surnamed Vitug. Juan Vitug is also
dead and is survived by his only
daughter Florencia Vitug.
The second wife of Clodualdo Vitug was Donata Montemayor with whom he
had 8 children, namely, Pragmacio, Maximo, Jesus, Salvador, Prudencio
and Anunciacion, all surnamed Vitug, the late Enrique Vitug
represented by his wife Natalia Laquian, and the
late Francisco Vitug who
is survived by 11 children, namely, Antonio, Francisco, Aurora, Pedro, Honorio,
Corazon, Anselmo, Benigno Eligio, Jesus and Luz.
Clodualdo Vitug died
intestate on May 20, 1929 so his estate was settled and distributed in
Special Proceeding No. 422 in the Court of First Instance of Pampanga wherein Donata Montemayor was the Administratrix.[7]
Meanwhile, on May 12,
1958, Donata Montemayor executed a
contract of lease of Lot No. 24, which is covered by TCT No. 2887–R in favor of her children Pragmacio
and Maximo both surnamed Vitug. This lease was extended on August
31, 1963. By virtue of a general power of attorney
executed by Donata Montemayor
on Sept. 19, 1966
in favor of Pragmacio Vitug,
the latter executed a contract of lease on Sept. 19, 1967 of the said lot in favor of Maximo Vitug.[8]
On March 21, 1970 Pragmacio Vitug and Maximo Vitug filed an action for
partition and reconveyance with damages in the Court
of First Instance of Pampanga against Marcelo Mendiola,
special administrator of the intestate estate of Donata
Montemayor who died earlier, Jesus Vitug, Sr., Salvador, Natalia, Prudencia, Anunciacion, all
surnamed Vitug, Antonio, Francisco, Aurora, Pedro, Honorio, Corazon, Anselmo, Benigno, Eligio, Jesus and
Luz, all surnamed Fajardo and the PNB.
The subject of the action is 30 parcels
of land which they claim to be the conjugal property of the spouses Donata Montemayor and Clodualdo Vitug of which they claim a share of 2/11 of 1/2 thereof. They assailed
the mortgage to the PNB and the public auction of the properties as null and
void. They invoked the case of Vitug vs. Montemayor, L-5297
decided by this Court on Oct. 20, 1953 which is an action for partition and
liquidation of the said 30 parcels of land wherein the properties were found to
be conjugal in nature.
In a decision of Sept.
15, 1975, the lower court dismissed the complaint with costs against the
plaintiffs and ordered them to pay attorney’s fees of P5,000.00 to the
defendant’s counsel. Plaintiffs then
interposed an appeal to the Court of Appeals, wherein in due course a decision was rendered on May 20, 1981, the dispositive
part of which reads as follows:
“WHEREFORE, in the light of the foregoing, the decision
appealed from is hereby reversed and set aside, and another one entered in
accordance with the tenor of the
prayer of appellant’s complaint with the modification that the sale at public
auction of the 22 parcels be considered valid with respect to the 1/2
thereof. No costs.”
Hence the herein petition
for certiorari filed by the PNB raising the following assignments of
error:
“I
THE RESPONDENT COURT OF APPEALS ERRED IN APPLYING TO THE CASE AT
BAR THE RULING OF THIS HONORABLE SUPREME COURT IN FLORENCIA VITUG VS. DONATA
MONTEMAYOR, ET AL., 91 PHIL. 286 (1953) BECAUSE:
A. BETWEEN
A PROVISION OF A SPECIAL LAW AND THE JUDICIAL INTERPRETATION AND/OR APPLICATION
OF A PROVISION OF A GENERAL LAW, THE FORMER
PREVAILS.
B. THE DOCTRINE OF STARE
DECISIS IS NOT A MECHANICAL FORMULA OF ADHERENCE.
C. PNB WAS NOT A
PARTY, AND HAD NO KNOWLEDGE OF THE ABOVE-CITED CASE.
D. SIMILARLY, PRAGMACIO
VITUG AND MAXIMO VITUG WERE NOT PARTIES IN SAID CASE.
II
THE RESPONDENT COURT OF APPEALS ERRED IN NOT RECOGNIZING THE
CONCLUSIVENESS OF THE CERTIFICATE, OF TITLE, AS PROVIDED IN ACT 496, AS AMENDED
(THE LAND REGISTRATION).
III
THE RESPONDENT COURT OF APPEALS ERRED IN IGNORING THE
CONCLUSIVENESS OF OWNERSHIP OF DONATA MONTEMAYOR OVER THE PROPERTIES WHICH WERE
REGISTERED EXCLUSIVELY IN HER NAME WHEN PRIVATE RESPONDENTS (PRAGMACIO VITUG
AND MAXIMO VITUG), AS LESSEES, ENTERED INTO A CONTRACT OF LEASE WITH DONATA
MONTEMAYOR AS THE OWNER-LESSOR.
IV
THE RESPONDENT COURT OF APPEALS ERRED IN CONCLUDING THAT PNB WAS A MORTGAGEE
IN BAD FAITH.”
The petition is impressed
with merit.
When the subject
properties were mortgaged to the PNB they were registered in the name of Donata Montemayor, widow. Relying on the torrens
certificates of title covering said
properties the mortgage loan applications of Donata
were granted by the PNB and the mortgages were duly constituted and registered
in the office of the Register of Deeds.
In processing the loan applications of Donata
Montemayor, the PNB had the right to rely on what
appears in the certificates of title and no more. On its face the properties are owned by Donata Montemayor, a widow. The PNB had no reason to doubt nor question
the status of said registered owner and her ownership thereof. Indeed, there are no liens and encumbrances
covering the same.
The well-known rule in
this jurisdiction is that a person dealing with a registered land has a right
to rely upon the face of the torrens certificate of
title and to dispense with the need of inquiring further, except when the party
concerned has actual knowledge of facts and circumstances that would impel a
reasonably cautious man to make such inquiry.[9]
A torrens
title concludes all controversy over ownership of the land covered by a final
decree of registration.[10] Once the title is registered the owner may
rest assured without the necessity of stepping into the portals of the court or
sitting in the mirador de su casa to
avoid the possibility of losing his land.[11]
Article 160 of the Civil Code provides as follows:
“Art. 160. All property
of the marriage is presumed to belong to the conjugal partnership, unless it be
proved that it pertains exclusively to
the husband or to the wife.”
The
presumption applies to property acquired during the lifetime of the husband and
wife. In this case, it appears on the
face of the title that the properties were acquired by Donata
Montemayor when she was already a widow. When the property is registered in the name of
a spouse only and there is no showing as to when the property was acquired by said spouse, this is an indication that the
property belongs exclusively to said spouse.[12] And this presumption under Article 160 of
the Civil Code cannot prevail when the title is in the name of only one spouse
and the rights of innocent third parties are involved.[13]
The PNB had a reason to
rely on what appears on the certificates of title of the properties
mortgaged. For all legal purposes, the
PNB is a mortgagee in good faith for at the time the mortgages covering said
properties were constituted the PNB was not aware to any flaw of the title of
the mortgagor.[14]
True it is that in the
earlier cases decided by this Court, namely Vitug vs.
Montemayor decided on May 15, 1952, which is an
action for recovery of possession of a share in said parcels of land,[15] and in the subsequent action for partition
between the same parties decided on Oct. 20, 1953,[16] this court found the 30 parcels of land in
question to be conjugal in nature and awarded the corresponding share to the
property of Florencia Vitug,
an heir of the late Clodualdo Vitug
from the first marriage. In said cases
this Court affirmed the decision of the lower court. In the dispositive
part of the decision of the trial court it made the observation that “but
from the conduct of Clodualdo Vitug
and Donata Montemayor
during the existence of their marital life, the inference is clear that Clodualdo had the unequivocal intention of transmitting the
full ownership of the 30 parcels
or land to his wife Donata Montemayor,
thus considering the 1/2 of the funds of the conjugal property so advanced for
the purchase of said parcels of land as reimbursible
to the estate of Clodualdo Vitug
on his death.”[17] That must
be the reason why the property was registered
in the name of Donata Montemayor
as widow after the death of Clodualdo Vitug.[18]
At any rate, although
actions for recovery of real property and for partition are real actions,
however, they are actions in personam that bind only the particular individuals who
are parties thereto.[19] The PNB not being a party in said cases is not bound by the said decisions. Nor does it appear that the
PNB was aware of the said decisions when it extended the above
described mortgage loans. Indeed, if the
PNB knew of the conjugal nature of said properties it would not have approved
the mortgage applications covering said properties of Donata
Montemayor without requiring the consent of
all the other heirs or co-owners thereof.
Moreover, when said properties were sold at public auction, the PNB was a purchaser for value in good faith
so its right thereto is beyond question.[20]
Pragmacio and Maximo Vitug are now estopped from
questioning the title of Donata Montemayor
to the said properties. They never
raised the conjugal nature of the property nor took issue as to the ownership
of their mother, Donata Montemayor,
over the same. Indeed private
respondents were among the defendants in said two cases wherein in their answers
to the complaint they asserted that the properties in question are paraphernal properties belonging exclusively to Donata Montemayor and are not
conjugal in nature.[21] Thus they leased the properties from their
mother Donata Montemayor
for many years knowing her to be the owner.
They were in possession of the property for a long time and they knew
that the same were mortgaged by their mother to the PNB and thereafter were
sold at public auction, but they did not do anything.[22] It is only after 17 years that they
remembered to assert their rights.
Certainly, they are guilty of laches.[23]
Moreover, as correctly
held by the lower court, Pragmacio and Maximo Vitug as occupants and
lessees of the property in question cannot now dispute the ownership of their mother
over the same who was their lessor.[24]
WHEREFORE, the
subject decision of the respondent Court of Appeals is hereby REVERSED and set aside and another decision is
hereby rendered DISMISSING the complaint and ordering private respondents to
pay attorney’s fees and expenses of
litigation to petitioner PNB in the amount of P20,000.00 and the costs of the
suit.
SO ORDERED.
Teehankee, C.J., Narvasa, and Cruz, JJ.,
concur.
Paras, J., in the result.
* Penned by Mr. Justice Porfirio V. Sison, and concurred
in by Messrs. Justices Juan Sison and
Elias B. Asuncion.
[1]
Annex 2, Answer of PNB, Record on Appeal; par. 11, Partial Stipulation of
Facts, p. 139, Record on Appeal.
[2]
Annex 1, Answer of PNB, Record on Appeal; par. 17, Partial Stipulation of Facts, pp. 141-142, supra.
[3]
Par. 16, Partial Stipulation of Facts, p. 141, supra.
[4]
Par. 18, Partial Stipulation of Facts, p. 142, supra.
[5]
Pars. 12, 13, 19, 20, 21, and 22, Partial Stipulation of Facts,
pp. 139-144, supra.
[6]
Pars. 6 to 10 and 11, Partial Stipulation of Facts, pp. 124, 125 and 139, Record on
Appeal.
[7]
Pars. 22, 23, and 24, Partial
Stipulation of facts, pp. 144-145, Record
on Appeal.
[8]
Pars. 5, 6, 7, 8, 15, pp. 136-140, supra.
[9]
Capital Subdivision vs. Province
of Negros
Occidental, L-16257, January 31, 1963,
7 SCRA 60; Fule vs. Legare,
L-17951, Feb. 28, 1963, 7
SCRA 351.
[10]
Legarda and Prieto vs.
Salleeby, 31 Phil. 590.
[11]
Director of Lands vs. Court of Appeals, 122 SCRA 37 70.
[12]
Maramba vs. Lozano, 20 SCRA 474.
[13]
Nable Jose vs. Nable
Jose, 41 Phil. 713; Seva vs. Nolan, 340.
[14]
Cui and Joven vs. Henson, 51 Phil. 605, 612; Roxas vs. Dinglasan,
L-27234, May 30, 1969, 28
SCRA 430.
[15]
91 Phil. 286.
[16]
93 Phil. 99.
[17]
91 Phil. 289.
[18]
Exhibit 17 PNB & 18 PNB, Pp. 210-212, Record on Appeal.
[19]
Ang Lam vs. Rosillosa,
L-3595, May 22, 1950;
Hernandez vs. Rural Bank of Lucena, L-2979, Jan. 10, 1978, 81 SCRA 84-85.
[20]
Fule vs. Legare,
supra; Arches vs. Billanes, L-20452, April 30, 1965, 13 SCRA 715.
[21]
Vitug vs. Montemayor,
91 Phil. 286, 288; see also Exhibits 3 Mendiola, 3-A Mendiola, 3-B Mendiola, pp. 238-240, Record on Appeal.
[22]
Exhibits 1, 1-A, and 1-B Mendiola, 2 and 2-A Mendiola, pp. 236-238, Record on Appeal.
[23]
Tijam vs. Sibonghanoy,
L-21450, April 15, 1968, 32
SCRA 29.
[24]
Section 3(b), Rule 131, Rules of Court.