MANUEL B. RUIZ, MARCIAL QUIÑONES, FILOMENA QUIÑONES, MACARIO QUICIO AND ALEJANDRA BALICO, PETITIONERS, VS. THE HONORABLE COURT OF APPEALS, THE HONORABLE JUDGES VICENTE BULLECER …

This is a petition for certiorari filed by the herein
petitioners Manuel B. Ruiz, Marcial Quiñones, Filomena Quiñones and the spouses
Macario Quicio and Alejandra Balico against the resolution of the Court of
Appeals dated April 8, 1968 in CA-G.R. No. 41028-R which orders the dismissal
of the petition for prohi­bition and mandamus filed therein by the
herein peti­tioners against the orders of the herein respondent Judges Vicente
Bullecer and Alfredo I. Gonzales, and denies the petitioners’ motion to dismiss
the complaint filed against them by the herein private respondents Jovencio Q.
Tancontian, Socorro T. Aguilon, Salvacion T. Diao, Imlda T. Noel, Jesus Aguilon
and Alfredo Noel, Jr.^[1]

It appears that on March
21, 1966, the herein private respondents filed in the Court of First Instance
of Davao (docketed as civil case 5003) an action for the recovery of a parcel
of land against the herein petitioners containing, inter alia,
the following allegations:

“x x x

“4.   That Lucrecia Quiñones, Baldomero Quiñones
and Meliton Quiñones are the legitimate children of Florentino Quiñones and
Micaela Barrios, all deceased;

“5.   That Meliton Quiñones was the absolute owner
of a parcel of land containing an area of 100,006 square meters or 10 hectares
located in Davao City, having inherited the same from his deceased father …;

“6.   That on December 20, 1941, said Meliton
Quiñones died intestate, without any debts or obligations and without any
ascendants or descendants, leaving as his only surviving legal heirs his
nephews and nieces, namely, the plaintiffs Jovencio Q. Tancontian, Socorro T.
Aguilon, Salvacion T. Diao and Imelda T. Noel, as the legitimate children of
Lucrecia Quiñones, and the defendants Marcial Quiñones and Filomena Quiñones,
as the legitimate children of Baldomero Quiñones, who succeeded as owners and
successors­in-interest to the above-described parcel of land, in their own
rights and in equal shares;

“7.  That on September 27, 1952, defendants
Marcial Quiñones and Filomena Quiñones, claiming to be the legal heirs of
Meliton Quiñones to the exclusion of plaintiffs, filed a complaint with the
Court of First Instance of Davao, for recovery of ownership of the
above-described parcel of land with damages against Vedasto Corcuera, which was
then covered by Transfer Certificate of Title No. 201 in the name of Vedasto
Corcuera, assisted by defendant Manuel B. Ruiz as their lawyer, which case was
docketed as Civil Case No. 904 …;

“8.   That defendants Marcial Quiñones and
Filomena Quiñones, with the able assistance of their counsel, defendant, Manuel
B. Ruiz, won the case in court and succeeded in reco­vering the ownership of
the above-described parcel of land from Vedasto Corcuera in the early part of
1956 when the decision in Civil Case No. 904 became final and executory;

“9.  That shortly after recovery of the property
from Vedasto Corcuera.  Transfer
Certificate of Title No. 201 in the name of Vedasto Corcuera was cancelled and
a new Transfer Certi­ficate of Title No. T-6549 … was issued in the names of
defendants Marcial Quiñones and Filomena Quiñones;

“10. That such color
of ownership was short-lived, for instead of partitioning the said parcel of
land among the surviving legal heirs, who are the defendants Marcial Quiñones
and Filomena Quinones and the plaintiffs Jovencio Q. Tancontian, Socorro T.
Aguilon, Salvacion T. Diao and Imelda T. Noel, in equal shares, the said parcel
of land should have been divided into six (6) equal shares, said defendants
Marcial Quiñones and Filomena Quiñones, with the active participation and influence
and pressure of their counsel, defendant Manuel B. Ruiz, occupying a vantage
position as their counsel in Civil Case No. 904, the latter succeeded to press
and dictate his terms upon his clients, who are ignorant and illiterate as
shown by the fact that they could not even write their names, and in breach of
the rule so amply protective of the con­fidential relations which must
necessarily exist between attorney and client, con­federating and conniving
with defendant Macario Quicio, who is not in a financial position to negotiate
the sale of the above-described parcel of land, succeeded in making defendants
Marcial Quinones and Filomena Quiñones execute a simulated and fictitious deed
of sale of the said parcel of land in favor of defendant Macario Quicio in
April, 1956, a few days after the decision in Civil Case No. 904 had become
final and executory …;

“11. That with the
execution of this deed of sale (Annex ‘B’), Transfer Certificate of Title No.
T-6549 in the names of Marcial Quiñones and Filomena Quiñones was cancelled and
a new Transfer Certificate of Title No. T-6550 and later changed to Transfer
Certificate of Title No. T-6588 of the Register of Deeds of Davao was issued in
the name of defendant Macario Quicio;

“12. That
considering the ignorance and illiteracy of defendants Marcial Quiñones and
Filomena Quiñones, they were practically made to be parties to a simulated and
fictitious sale in favor of defendant Macario Quicio, the fact being that the
real purchaser of the said parcel of land was their counsel, defendant Manuel
B. Ruiz;

“13. That it was
indeed unusual that after defendants Marcial Quinones and Filomena Quiñones had
won their case to recover the ownership of the land from Vedasto Corcuera,
which took them several years of waiting, immediately after the decision had
become final and executory, they had to sell the land for an inadequate and
unconscionable consi­deration without even the pleasure of taking possession of
the land and the enjoyment of the fruits thereof even for a month’s time, since
the alleged sale in favor of Macario Quicio took place on April 10, 1956,
shortly after the decision in their favor had become final;

“14. That the
alleged consideration of P15,000.00 appearing in the deed of sale (Annex ‘B’),
assuming it to be true, is not only inadequate and unconscionable, but has all
the earmarks of a forced sale upon the harassed clients of defendant Manuel B.
Ruiz, considering not only that the land contains 10 hectares which is fully
planted with coconuts, but is located in the residen­tial area of Davao City
and could have been sold for a much higher price, as borne out by the fact that
the market value of this parcel of land is not less than P20.00 per square
meter or P2,000,000.00 for the entire area;

“15. That defendant
Manuel B. Ruiz ought to know and should know the execution of this deed of sale
in favor of Macario Quicio, since the document was prepared in his own law
office and notarized by his own brother and law associate Atty. Alejandro B.
Ruiz on April 10, 1956:

“16. That after the
execution of the deed of sale in favor of defendant Macario Quicio, said
Macario Quicio never took possession of the land as the owner thereof and
gathered the fruits therefrom but defendant Manuel B. Ruiz, a subsequent fact
confirming that said deed of sale in favor of Macario Quicio was fictitious and
to give a color of transfer to an innocent purchaser in good faith and for
value;

“17. That on
December 10, 1956, barely eight months after the alleged simulated sale in
favor of defendant Macario Quicio, said defendant Macario Quicio executed
another simulated and fictitious deed of sale over the same parcel of land
covered by Transfer Certificate of Title No. 6588 in favor of defendant Manuel
B. Ruiz a transaction designed to show that defendant Manuel B. Ruiz was a
purchaser for value and in good faith…;

“18. That by virtue
of this deed of sale,(Annex ‘C’) executed by defend­ant Macario Quicio and
Alejandra Balico, his wife, in favor of defendant Manuel B. Ruiz, the latter
succeeded in the cancellation of Transfer Certi­ficate of Title No. T-6588 in
the name of Macario Quicio and a new Transfer Certificate of Title No. T-7355
was issued to defendant Manuel B. Ruiz;’

“19. That when
defendant Manuel B. Ruiz sold a portion of the said land to his brother, Atty.
Alejandro B. Ruiz, Transfer Certificate of Title No. T-7355 was cancelled and a
new Transfer Certificate of Title No. T-16126 was issued in the name of
defendant Manuel B. Ruiz …;

“20.  That the alleged deed of sale (Annex ‘B’) executed
by defendants Manuel Quiñones and Filomena Quiñones in favor of defendant
Macario Quicio was null and void from the very begin­ning, not only because it
is simulated and fictitious but a design to cir­cumvent the prohibition of the
law (Article 1491, Civil Code of the Philippines), the purpose of which was to
feign transfer by defendants Marcial Quiñones and Filomena Quiñones to
defendant Macario Quicio, as a stranger, and to make it appear that defendant
Macario Quicio was a purchaser for value and in good faith and to avoid the
prohibition against lawyers from purchasing the property involved in the
litigation in which defendant Manuel B. Ruiz took part from the beginning until
its termination by virtue of his profession, as confirmed by subsequent events;

“21. That this
simulated deed of sale in favor of defendant Macario Quicio is a violation of
law and legal ethics, an act which constitutes malpractice and punishable by
our laws, is revealed by the fact that said defendant Macario Quicio, from April,
1956 up to December 10, 1956, when he allegedly executed a deed of sale in
favor of defendant Manuel B. Ruiz, had never been in possession of the land in
the exercise of his ownership, but all that time, it was defendant Manuel B.
Ruiz who had been in possession of the land and had been gathering the fruits
thereof;

“22. That defendant
Macario Quicio was never the true purchaser of the land … since he was not
and still is not in a position financially to pay the said consideration of
P15,000.00, if that were true, but that the true purchaser of the land was
defendant Manuel B. Ruiz …;

“23. That defendant
Manuel B. Ruiz is neither a purchaser for value and in good faith, knowing fully
well that Macario Quicio and his wife, Alejandra Balico, were merely tools of
his design to avoid the provision of law prohibiting lawyers from acquiring by
purchase, directly or indirectly, the land which has been the subject of the
litigation in Civil Case No. 904 in which he had been the counsel;

“24. That defendant
Manuel B. Ruiz was fully aware of his mode of (his) acquisition and the flaw of
his title that invalidates the same, not only that his acquisition of the land
of his clients was con­trary to law but a violation of legal ethics …;

“25. That the deed
of sale (Annex ‘C’) executed by defendants Macario Quicio and his wife,
Alejandra Balico, is another simu­lated and fictitious sale to com­plete the
plan to transfer the property to defendant Manuel B. Ruiz to give him a color
of good faith and as a purchaser for value, since it appears that he had
acquired the land by purchase from a supposed purchaser for value and in good
faith and a stranger in Civil Case No. 904; said deed of sale however was
prepared in his law office and notarized by one of the law assistants, Atty.
Florencio Gaspar;

“26. That the deeds
of sale (Annexes ‘B’ and ‘C’) in favor of Macario Quicio and subsequently in
favor of Manuel B. Ruiz, are null and void from the beginning, and, therefore,
said defendants Macario Quicio and Manuel B. Ruiz have never acquired any valid
title of ownership to the land in question;

“x x x.”

On April 13, 1966, the
petitioners filed a motion to dismiss the foregoing complaint on the grounds that
(a) the complaint did not state a cause of action; and (b) the cause of action,
if any existed, was barred by the statute of limitations.  This motion was heard by the trial court on
April 16, 1966 in the absence of the plaintiffs, on which date an order was
issued granting the same and dismissing the complaint in question.

The private respondents
(as plaintiffs below) filed a motion for reconsideration, dated April 19, 1966,
alleging that their counsel received a copy of the herein petitioners’ motion to
dismiss only on April 16, 1966 by registered mail.  This was opposed by the petitioners who
claimed that their counsel’s messenger tried to deliver personally a copy of
their (petitioners’) motion to dismiss at the private respondents’ counsel’s
office but the person in charge of the office refused to accept the same for
which reason they sent a copy of their motion to dismiss by registered mail
instead.  The petitioners also argued
that the mentioned motion for reconsideration should be treated as a petition
for relief under Rule 38 of the Rules of Court and, as it was not accompanied
by any affidavit of merit and was not verified, the same should be considered
as a mere scrap of paper.  In an order,
dated April 29, 1966, the court a quo granted the private
respondents’ motion for reconsideration. 
The private respondents thereafter filed their opposition to the motion
to dismiss.

On July 5, 1966 the court a quo issued another
order apparently reconsidering again its previous stance and denying the motion
to dismiss of the herein petitioners.

Subsequently, another motion to dismiss was filed by the herein
petitioners with the trial court alleging that the private respondents failed
to pay the correct docket fee corresponding to the amount of P2 million which
was allegedly averred in the complaint in question as the value of the parcel
of land in dis­pute.  The private
respondents filed their opposition stating that the assessed value of the
mentioned land was only P12,620.00 according to the tax declaration issued to
the herein petitioner Ruiz and that the statement in their complaint that the
said land has a value of P2
million “is purely subjective and speculative.” In an order, dated
October 1, 1966, the trial court denied the second motion to dismiss of the
herein petitioners.

Failing to secure a reconsideration of the orders of April 29 and
July 5, 1966 from Judge Alfredo I. Gonzales,^[2]
the petitioners, on April 1, 1968, filed with the Court of Appeals a petition for prohibition and mandamus
against the herein respondent judges Vicente Bullecer and Alfredo I.
Gonzales.  The Court of Appeals, however,
in a resolution, dated April 8, 1968, dismissed their petition, stating that
the court a quo did not commit any abuse of discretion and that
The proper remedy for the petitioners to pursue is to assail the order denying
their motion to dismiss in the appeal from the decision of the case on the
merits.  A motion to reconsider the said
resolution having been denied, petitioners interposed the present petition for certiorari.

The petitioners contend
that the Court of Appeals erred in ordering the dismissal of their petition
below on mere procedural grounds rather than resolving the same on its merits.

On August 22, 1969,
however, the petitioners Marcial Quiñones and Filomena Quiñones filed a motion
in this Court praying that they be allowed to withdraw as co-petitioners herein
on the grounds that they have withdrawn their authority to their co-petitioner
Manuel B. Ruiz to appear as counsel in their behalf in civil case 5003, supra,
and have filed a motion before the court a quo in the said case
praying that they be dropped as party-defendants and be joined instead as
party-plaintiffs therein.  In the
affidavits executed by Marcelo Quiñones and Filomena Quiñones and their
proposed amended complaint in civil case 5003 which were filed in this Court in
connection with their petition to withdraw as petitioners herein, they claim,
in brief, that when they engaged the services of herein petitioner Ruiz as
their counsel in the mentioned civil case 904 against Vedasto Corcuera, they
offered to give him a share of the land in question as his attorney’s fees, but
that after they won the case, they were pressed to agree on the sale of the
land in question instead for only P2,000.00 and to thumbmark an undated deed of
sale for a fictitious sum of P15,000.00 in favor of herein petitioner Quicio
whom they have never known or seep.

On August 26, 1969, this
Court granted the foregoing petition of Marcial Quiñones and Filomena Quiñones
to withdraw as co-petitioners herein.

After considering the
instant petition on its merits as urged by the petitioners herein, this Court
finds no sufficient reason to reverse the order of dismissal complained of.

1. The settled rule where the dismissal of an action is
sought on the ground that the complaint does not state a cause of action is
that the insuffi­ciency of the cause of action must appear on the face of the
complaint (Azur vs. Provincial Board, 27 SCRA 56; Dimayuga vs. Dimayuga, 51
O.G. 2397; Marabiles vs. Quito, 52 O.G.
6507).  And the test of the sufficiency
of the ultimate facts alleged in the complaint, to constitute a cause of
action, is whether or not, admitting the facts alleged, the court could render
a valid judg­ment upon the same in accordance with the prayer of the complaint
(Ibid.).  For this purpose, the
movant is deemed to admit hypothetically the truth of the facts thus averred
(Republic vs. Ramos, 7 SCRA 50).

Admittedly, the phraseology of the questioned complaint leaves
considerable space for improvement.  Mere
ambiguity in the averment of the cause of action is not, however, sufficient
justification for the dis­missal of the complaint.  As we held in Azur vs. Provincial Board,
supra, “though the allegations of the complaint are ambiguous,
indefinite or uncertain, but, nevertheless, a cause of action can, in any
manner, be made out therefrom, and plaintiff would be entitled to recover in
any aspect of the facts or any combination of the facts alleged, if they were
to be proved, then the motion to dismiss should be denied.” In such cases,
the defendant’s remedy should be to request for a bill of particulars (Cf.
Amaro vs. Sumanquit, 5 SCRA 708).

The basic elements of the theory that can be drawn from the
herein private respondents’ complaint below which, if proved, will permit
recovery of the land in dispute, may be summed up thus:  (a) that as legal heirs of their deceased
uncle Meliton Quiñones who died without issue in 1941 the private respondents
are equally entitled as their cousins Marcial Quiñones and Filomena Quiñones to
the questioned land left by their late uncle; (b) that Marcial Quinones and
Filomena Quiñones were able to register the said land in their names after they
won in the court suit over the said land against Vedasto Corcuera; in the said
case herein petitioner Ruiz appeared as Marcial Quinones’ and Filomena
Quinones’ counsel; they also claimed therein that they were the sole and
exclusive heirs of the deceased Meliton Quiñones; and (c) that Marcial Quiñones
and Filomena Quiñones sold the land in dispute under a deed dated April 10,
1956 to the herein petitioner spouses Macario Quicio and Alejandra Balico who
later sold the same under a deed dated December 22, 1956 to herein petitioner
Ruiz under circumstances indicating that both purported sales were absolutely
null and void, such as:  (1) the
proximity of the dates appearing in the documents purporting to evidence the
sales in question to each other as well as to the time when Marcial Quiñones
and Filomena Quiñones won the suit against Vedasto Corcuera after a protracted
litigation which lasted from 1952 to 1956; (2) the grossly inadequate price at
which the questioned land was sold, that is, for only P15,000.00 when it has a
fair market value of about P2 million consisting as it does of ten (10)
hectares and located in the residential district of Davao City; (3) petitioner
Quicio was not in a financial position to pay the said price of P15,000.00; (4)
both sales were entered into in violation of article 1491 of the new Civil Code
which prohibits lawyers from acquiring “property and rights which may be
the object of any litigation in which they may take part by virtue of their
profession;” and (5) the sales in question were executed as means of
making it appear that the land in dispute was purchased by buyers in good
faith.

The argument stressed by the petitioner Ruiz that since the sales
of the land in question, as evidenced by notarized documents cited in the
complaint, were executed after the decision in civil case 904 against Vedasto
Corcuera became final and conclusive, therefore, the sales were not void ab
initio but merely voidable at the instance of the vendor under the rule
laid down in Wolfson vs. Estate of Enriquez (20 Phil. 340), is of no
consequence to the case at bar not only because the environmental milieu in the
Wolfson case is not entirely identical and similar to the facts and
motivations sought to be proved by the private respond­ents in their complaint,
but also because the averments contained in the said complaint of the private
respond­ents will sufficiently permit adducement of facts not only that the
sale of the land in question to petitioner Ruiz, as counsel for the plaintiffs
in civil case 904, was actually perfected while the land in dispute was still
in litigation, but also that there was collusion among all the original
petitioners herein to bring about the assailed sales transactions, induced
primarily by the ascendancy exercised by petitioner Ruiz over his
“uncouth” clients in order to make it appear that the said land was
purchased by a buyer in good faith thereby precluding its legitimate owners
from recovering the same in view of the protective provisions of the Land
Registration Act towards purchasers in good faith and for value.  Evidently, a contract entered into under such
circumstances, to the extent that it prejudices third persons with legitimate
claims, is null and void ab initio because its perfection and
consummation constitute a violation of public policy due to the illegal purposes by which it was
motivated and because such an agreement carries with it the patent badges of
absolute simulation. At all events, Marcial Quiñones and Filomena Quiñones have
now joined the private respondents in recovering the land in dispute from the herein
petitioners Quicio and Ruiz, and this Court is satisfied, after a careful
examination of the amended complaint which they submitted to the court a
quo, that the same sufficiently states a cause of action against the
petitioners Quicio and Ruiz.

2. The plea of prescription cannot likewise be sustained.

 According to the present petitioners Quicio
and Ruiz, under the facts alleged in the questioned complaint, the private
respondents’ cause of action accrued in 1941 so that for purposes of resolving
whether or not the action below has prescribed, the old laws, specifically, Act
190, should govern as provided for in article 1116 of the new Civil Code.  (See Carillo vs. De Paz, 18 SCRA 467; Joaquin
vs. Cojuangco, 20 SCRA 769; Parcotillo vs. Parcotillo, 12 SCRA 435).^[3] Under the mentioned Act 190, adverse
possession either in good faith or had faith ripened into ownership after the
lapse of ten years in the same manner that an action to recover title to or
possession of an immovable prescribed in the same period (See Ongsiaco vs.
Dallo, 27 SCRA 165).

The foregoing principles cannot be applied, however, to the case
at bar for the following reasons:  (a)
one of the causes of action of the private res­pondents against the herein
petitioners is that the sales, contracts over the land in dispute in favor of
petitioners Quicio and Ruiz, respectively, are null and void ab initio
because they were calculated to deprive the former of their legitimate claims
over the said property; under article 1410 of the new Civil Code “The
action or defense for the declaration of the inexistence of a contract does not
prescribe;” this was already a well-settled rule even before the enactment
of the new Civil Code (See Eugenio vs. Perdido, 97 Phil. 43; Angeles vs. Court
of Appeals, 102 Phil. 1011); (b) for purposes of acquisitive prescription in
favor of petitioner Ruiz, it should be noted that less than ten (10) years have
elapsed between the time the land in dispute was registered in the name of the
herein petitioner Quicio in April, 1956 (from whom the herein petitioner Ruiz
allegedly acquired the said land by purchase on December 22, 1956) and the time
of the filing in court of the questioned complaint on March 25, 1966; the rules
are well-settled in this jurisdiction that when a person through fraud succeeds
in registering the property in his name, the law:  (1) creates what is called a
“constructive or implied trust” in favor of the defrauded party (see
Sevilla vs. de los Angeles, 97 Phil. 877; Bancairen vs. Diones, 98 Phil. 122
Marabiles vs. Quito, L-10408, Oct. 18, 1956; Cuison vs. Fernandez, L-11764, Jan. 31, 1959; and Malabanan vs.
Mendoza, L-12540, Feb. 28, 1959) and (2) grants
the latter the right to recover the property fraudulently registered
within a period of ten (10) years (Diaz vs. Gorricho, L-11229, March 29, 1958;
Candelaria vs. Romero, L-12149, Sept. 30, 1960; J.M. Tuason & Co., Inc. vs.
Magdangal, L-15539, Jan. 30,1962; Gonzalez vs. Jimenez, L-19073, Jan. 30, 1965;
Buencamino vs. Matias, 16 SCRA 849; Cuaycong vs. Cuaycong, 21 SCRA 1192 and
Alzona vs. Capunitan, 4 SCRA 450); and (c) although under Article 1138 of the
new Civil Code (Art. 1960 of the old Civil Code), it is provided that “in
the computation of time necessary for pres­cription … the present possessor
may complete the period necessary for prescription by tacking his possession to
that of his grantor or predecessor in interest,” this provision applies
only where there is privity between the successive possessors (Razote vs.
Razote, 49 Phil. 182; and Lacson vs. Government, 39 Phil. 631).  It does not apply to a case where, as the
herein private respondents aim to prove at the trial of the case at bar, the
present possessor came into possession of the land in dispute by virtue of a
sale that is null and void ab initio because the sale was entered into
contrary to public policy and was, furthermore, absolutely fictitious and
simulated.  In fact, even the vendors
themselves — Marcial Quinones and Filomena Quinones — are impugning the
validity of the sale made by them of the land in question to herein petitioner
Quicio as well as the alleged sale that took place between petitioners Quicio
and Ruiz concerning the same property.

ACCORDINGLY, the instant petition is denied.  Without costs.

Teehankee, Makasiar, Muñoz Palma, Martin, Fernandez, and Guerrero, JJ., concur.

^[1]
Private Private respondents Jesus Aguilon and Alfredo Noel, Jr. are joined as
respondents herein for being the husbands, respectively, of Socorro T. Aguilon
and Imelda T. Noel.

^[2]
The province of Davao was divided into
three (3) provinces during the pendency of the instant con­troversy below. As a
result of the re-shuffling of cases that followed, civil case 5003 was
transferred from the sala of Judge Bullecer to Judge Gonzales.

^[3]
Art. 1116 provides:  “Prescription
already running before the effectivity of this Code shall be governed by laws
previously in force; but if since the time this Code took effect the entire
period herein required for prescription should elapse, the present Code shall
be applicable, even though by the former laws a longer period might be
required.” (Cf. Art. 2258, new Civil Code).