RAMON MERCADO, BASILIA MERCADO JOINED BY HER HUSBAND, FRANCISCO RONQUILLO, PLAINTIFF AND APPELLANTS, VS. PIO D. LIWANAG, DEFENDANT AND APPELLEE.

The present appeal, taken by the plaintiff from the decision of the
Court of First Instance of Rizal (Quezon City), is before us on
certification by the Court of Appeals, the questions involved being
purely legal. The case was submitted to the trial court upon the
following stipulation of facts:

“1. That the Complaint filed by the plaintiffs
against the defendant seeks to annul a Deed of Sale on the ground of
fraud and on the provisions of Article 493 of the Civil Code.

“2.
That on July 14, 1956, in the City of Manila, Philippines, the
plaintiff Ramon Mercado and the defendant Pio D. Liwanag executed a
Deed of Sale, photostat copy of which is attached hereto marked as
Annex “A” and forming an integral part hereof, covering a divided half
and described in metes and bounds, or an area of 2,196 square meters at
P7.00 per square meter or for a total amount of P15.372.00, of a parcel
of land situated at Kangkong, Quezon City, covered Transfer Certificate
of Title No. 20805 of the Register of Deeds for the province of Rizal,
now Quezon City;

“3. That the said T.C.T. No. 20805
containing an area of 4,392 square meters, is issued in the name of the
plaintiffs Ramon Mercado and Basilia Mercado as co-owners PRO-INDIVISO,
and the sale was without the knowledge and consent of plaintiif Basilia
Mercado;

“4. That out of the total area of 4,392 square
meters, an area consisting of 391 square meters was expropriated by the
National Power Corporation sometime in December, 1953 at a price of
P10.00 per square meter, Civil Case No. Q-829 (Eminent Domain), of the
Court of First Instance of Rizal, Quezon City Branch, entitled
“National Power Corporation, plaintiff, versus Brigido Almodoban, et
als., defendants,” but this fact of expropriation came to the knowledge
of the defendant Pio D. Liwanag upon the registration of the Deed of
Sale Annex “A”;

“5. That pursuant to the Deed of Sale Annex
“A” T.C.T. No. 32757 was issued in the name of Pio D. Liwanag and
Basilia Mercado, photostat copy of which is hereto attached and marked
as Annex “B”;

“6. That defendant submits the receipt signed
by plaintiff Ramon Mercado dated July 14, 1956 photostat copy of which
is attached hereto and marked as Annex “C” and promissory note of the
same date for P10,000.00, photostat copy of which is attached hereto
and marked as Annex “D” which are both self-explanatory, but plaintiff
Ramon Mercado disclaims payment and receipt of such check and
promissory note, the check being uncashed and is still in the
possession of Atty. Eugenio de Gracia;

“7 That plaintiffs and
defendant respectfully submit for resolution of this Honorable Court
the issue of whether or not the Deed of Sale Annex “A” could be
annulled based on the foregoing facts-in relation to Article 493 of the
Civil Code, setting aside all other issues in the pleadings.”

Upon the issue thus presented the trial court held that under
Article 493 of the Civil Code the sale in question was valid and so
dismissed the complaint, without costs. This ruling is now assailed as
erroneous.

Article 493 provides:

“Each co-owner shall have the full ownership of his
part and of the fruits and benefits pertaining thereto, and he may,
therefore, alienate, assign or mortgage it, and even substitute another
person in its enjoyment, except when personal rights are involved. But
the effect of the alienation or the mortgage, with respect to the
co-owners shall be limited to the portion which may be allotted to him
in the division

Appellants except to the application of this provision in this case
for the reason that in the deed of sale sought to be annulled the
vendor disposed of a divided and determinate half of the land under
co-ownership. The argument, as far as it goes, seems to be tenable.
What a co-owner may dispose of under Article 493 is only his undivided
aliquot share, which shall be limited to the portion which may be
allotted to him upon the termination of the co-ownership. He has no
right to divide the property into parts and then convey one part by
metes and bounds. Lopez vs. Ilustre, 5 Phil. 567; Gonzales, et al. vs. Ichon, et al. 47 Off. Gaz. 6290; Manresa, Vol. 3, 7th ed. p. 630.

The pertinent recitals in the disputed deed of sale read:

“I hereby sell, transfer and convey absolutely and
irrevocably unto said Pio D. Liwanag, his heirs, successors, and
assigns my rights, title and interests on my chosen portion of the
above-described property which consist of one-half of aforesaid
ownership bounded on the West by Pacifico Gahudo, on the North by
Hacienda de Piedad and on the South by Circumferential Road, consisting
of 50 meters more or less frontal length along Circumferential Road and
with a total area of 2,196 square meters as indicated in Co-owners
Transfer Certificate of Title No. 20805.”

Nevertheless, upon registration of the sale and cancellation of
transfer certificate of title No. 20805 in the names of the previous
co-owners, the new transfer certificate that was issued (No. 32757) did
not reproduce the description in the instrument but carried the names
of appellee Pio D. Liwanag and Basilia Mercado as “co-owners
pro-indiviso.” There is no suggestion by any of the parties that this
new certificate of title is invalid, irregular or inaccurate. There is
no prayer that it be canceled. As far as Basilia Mercado is concerned
she retains in all their integrity her rights as co-owner which she had
before the sale, and consequently she has no cause to complain. Much
less has Ramon Mercado, for it was he who was responsible for whatever
indicia there may be in the deed of sale that a determinate portion of
the property was being sold, as shown by the second paragraph thereof,
quoted without contradiction in appellee’s brief as follows:

“That the aforesaid Transfer Certificate of Title
was originally in my name, but was split into two equal parts by virtue
of my desire to donate to my sister-in-law Jyana Gregorio an equal half
thereof with the understanding that I as donor would have the absolute
power to choose from the property owned in common that part which I
would like to segregate for myself or my heirs and assigns.”

And of course appellee himself not only does not challenge the new
certificate of title, wherein he appears as co-owner of an undivided
one-half share, but precisely relies upon it for his defense in this
action.

The title is the final and conclusive repository of the rights of
the new co-owners. The question of whether or not the deed of sale
should be annulled must be considered in conjunction with the title
issued pursuant thereto. Since, according to this title, what appellee
acquired by virtue of the sale is only an undivided half-share of the
property, which under the law the vendor Ramon Mercado had the absolute
right to dispose of, the trial court committed no error in dismissing
the action. The end-result of the transaction is in accordance with
Article 493 of the Civil Code.

The other point raised by appellants refers to the statement in the
dispositive portion of the decision appealed from that “the stipulation
with regards to the deed of sale based on the ground of fraud is
insufficient for all purposes and besides, no proof showing the
allegation of such fraud exists in the record.” It is contended that
the trial court erred in making such statement, the same being contrary
to the stipulation in which the parties expressly eliminated the issue
of fraud. From the entire context of the decision, however, it can be
gathered that the case was not decided on the basis of the said issue.
In any event, even if the court did err in considering the question of
fraud in spite of the stipulation, the error is not a prejudicial one.
As far as the dismissal of the action is concerned, it makes no
difference whether fraud has not been proven or fraud has been
abandoned as an issue by express agreement.

Wherefore, the decision appealed from is affirmed, with costs against appellants in this instance.

Bautista Angelo, Labrador, Concepcion, Barrera, Paredes, Dizon and Regala, JJ., concur.