DOMINGO R. ENRILE, JR., OMEGA ENRILE, SAMUEL A. ENRILE, EDGARDO A. ENRILE, ANTONIO A. ENRILE JR., EXEQUIL A. ENRILE, EUGENIO A. ENRILE, ELEIZAR A. ENRILE, ANTONIO E. YORONG, MAR…

Enrile versus Nochefranca

The Case

This is a case about a family land in Sibulan, Negros Oriental, and two deeds of quitclaim that quietly transferred ownership of that land to the family that had lent the owners money. The heirs of the Enrile and Rendal families, led by Domingo Enrile, Junior and his relatives, sued the Nochefranca family to have those two deeds declared void, and for damages. The trial court agreed with them, and the Nochefrancas appealed. The case matters because it shows how the Supreme Court treats a notarized deed when the persons who signed it never understood what they were giving away, and because it draws a bright line between a void contract, which can be attacked forever, and a merely voidable or defective one.

Procedural History

The Enrile heirs filed a complaint for Declaration of Inexistence of Instruments and Damages before the Regional Trial Court of Negros Oriental, Branch 34, in Dumaguete City. After trial, the Regional Trial Court ruled for the plaintiffs. It declared the two deeds of quitclaim and waiver of rights void, and ordered the plaintiffs to pay the defendants the unpaid loan of Five Thousand Pesos plus legal interest from the time it was incurred in July 1978 until fully paid. The defendants appealed, assigning as errors the finding of pactum commissorium, the refusal to uphold the notarized deeds, and the failure to apply laches and prescription. The appeal reached the Supreme Court, which resolved it by decision.

Facts

Two lots in San Antonio, Sibulan, Negros Oriental, covered by Original Certificate of Title Number OV-9241, were registered in the names of several Rendal siblings. Eleonora Rendal Enrile died intestate in January 1958. Through an extrajudicial settlement and quitclaim deed, the co-owners conveyed the lots to Domingo Enrile, Senior, the husband of the late Eleonora, together with their children. Domingo, Senior then tolerated Eleonora's relatives staying on the land as overseers and hired hands.

In June 1973, Domingo, Senior, his son Domingo, Junior, and Omega Enrile borrowed Four Thousand Pesos from Diego Nochefranca, Senior, mortgaging five ninths of the lots and agreeing to share the produce, one fifth to the debtors and four fifths to the creditor. In July 1978 they borrowed another Five Thousand Pesos, mortgaging the lots again, this time with one fourth of the produce to the debtors and three fourths to the creditor. The mortgage provided that if the loan was not redeemed within its term, it would continue in force until redeemed.

Then came the two deeds. In May 1993, Domingo, Junior, Esther, and Omega signed a Deed of Quitclaim and Waiver of Rights over their undivided share in favor of the Nochefrancas. In May 2002, Carmen Enrile, widow of Antonio Enrile, signed a similar deed. Both later testified that they believed they were only waiving their share in the fruits of the land until their debt was paid, not the ownership of the land itself. Domingo, Junior said he signed without reading because Leonora Nochefranca was in a hurry, and Carmen said she did not even know her husband owned land. When the debtors later tried to pay, the Nochefrancas claimed ownership by virtue of the deeds, so the debtors sued in April 2009.

Issues

• Whether or not the two deeds of quitclaim and waiver of rights are void for lack of consent, despite being notarized public documents.
• Whether or not the deeds constitute an illegal pactum commissorium.
• Whether or not the action is barred by prescription and laches.
• Whether or not the defendants may raise new theories, such as payment by cession, for the first time on appeal.

Applicable Provisions

Article 1318 of the Civil Code provides:

Article 1318. There is no contract unless the following requisites concur: (1) Consent of the contracting parties; (2) Object certain which is the subject matter of the contract; (3) Cause of the obligation which is established.

This is the provision the Court uses to strike down the deeds, because consent is one of the essential requisites and it was missing.

Article 1410 of the Civil Code provides:

Article 1410. The action or defense for the declaration of the inexistence of a contract does not prescribe.

This answers the defense of prescription, because a void contract may be attacked at any time.

Section 15 of Rule 44 of the Rules of Court provides:

Section 15. Questions that may be raised on appeal. Whether or not the appellant has filed a motion for new trial in the court below, he may include in his assignment of errors any question of law or fact that has been raised in the court below and which is within the issues framed by the parties.

This limits the appeal to questions already raised below, which is why the new theories of the defendants are rejected.

Ruling

On the first issue, the Court held that the deeds are void for lack of consent. The quitclaimants were made to believe they were waiving only their share in the fruits of the land, not its ownership. Consent must be intelligent, free, and spontaneous, and here it was not intelligent because the signers had no exact notion of what they were giving away. The Court stressed that notarization is not a guarantee of validity, and the presumption of regularity is rebutted where the notaries were not even present when the documents were signed.

On the second issue, since the deeds are void for want of consent, the Court did not need to sustain the trial court's theory of pactum commissorium, an illegal arrangement where the creditor automatically appropriates the mortgaged property upon default. The nullity rests on Article 1318.

On the third issue, the Court held that prescription does not run, because an action to declare the inexistence of a void contract does not prescribe under Article 1410. Laches, raised only on appeal, cannot prevail against an absolute nullity.

On the fourth issue, the Court refused to consider the new theory of payment by cession, because a party cannot change his theory on appeal, and defenses not pleaded in the answer may not be raised for the first time on appeal.

Doctrine

A contract without consent is non-existent and void, and the action to declare its inexistence does not prescribe. Notarization does not make a deed automatically valid; the presumption of regularity may be overcome by clear and convincing evidence, especially where the notary was not present at the signing. A party may not change his theory on appeal, and issues not raised in the trial court will not be entertained by the Supreme Court.

Disposition

The Supreme Court denied the appeal and affirmed the ruling of the Regional Trial Court, declaring the two deeds of quitclaim and waiver of rights void, with the plaintiffs directed to pay the unpaid loan of Five Thousand Pesos plus legal interest.

Remember This

Memorize this line: a void contract for lack of consent never prescribes, and notarization cannot cure a consent that was never intelligently given. Examiners use this case to test the requisites of consent under Article 1318, the imprescriptibility of actions under Article 1410, and the rule against changing theories on appeal.