VICENTE SANTANDER, THE HEIRS OF THE LATE FORTUNATA VILLINISO NAMED CONSTANCIO, MATIAS, GENOVEVA, PAZ, JOSE, IRINEO. AND ANATALIA ALL SURNAMED SANTANDER AND CRISPULO TAJANLANGIT,…

On July 29, 1937, a homestead patent covering a tract of land of over six
hectares situated in the Municipality of Midsayap, Province of Cotabato, was
granted to appellant Vicente Santander, married to Fortunato Villiniso, and on
July 6, 1938, Original Certificate of Title No. 1497 was issued to Santander by
the Register of Deeds of Cotabato.

On February 26, 1942, Santander signed a document purporting to be an
absolute sale of a two-hectare portion of his homestead to Celedonia Asuncion,
married to Manuel Villanueva, for the price of P480.00 (Exh. “1”). It was
expressly stipulated in the deed that the conveyance was to become effective
only after the approval of the authorities concerned. Possession of the land
conveyed was, upon execution of the document, transferred to the buyer.

Seven years later, on November 2, 1948, Santander and his children (as the
heirs of his deceased wife) commenced this action in the court below against
Celedonia Asuncion and her husband Manuel Villanueva, to recover the two-hectare
portion of Santander’s homestead in defendants’ possession, on the theory that
the land was transferred to Asuncion only in mortgage to secure a loan ofP180
obtained from her by Santander way back in June, 1940, and offering to pay
defendants the alleged loan. Defendants answered, denying the allegations of the
complaint, and claiming to have purchased the land in question from Santander on
February 26, 1942 by virtue of the deed of sale Exh. “l”, and that said sale had
already been approved by the Secretary of Agriculture and Commerce on August 2,
1947 (Exhs. “3” and “3-A”) (copies of Exhs. “1” and “3” and “3-Aw”were attached
to the answer). Confronted with the deed of sale Exh. “1” and the corresponding
approval of the Secretary of Agriculture and Commerce, plaintiffs amended their
complaint alleging that the deed of sale Exh. “1” is false and does not express
the true intent and agreement of the parties and that, in any cask, said sale is
null and void, having been executed within five years from the issuance of
Santander’s patent. Defendants filed an amended answer, insisting on the
validity of the sale Exh. “1” in view of the subsequent approval thereof by the
Secretary of Agriculture and Commerce.

After trial, the lower court rendered judgment, finding the sale Exh. “1” to
be genuine and to have been executed by plaintiff Santander with full knowledge
of its contents; but that as said sale was made within the prohibitive period of
five years under sec. 118 of Commonwealth Act No. 141, the same is null and
void. The court, however, likewise found that the value of the property in
question had increased many-fold since the time Santander executed Exh. “l”,
because of the expansion of the poblacion of Midaayap and the change in
kind of the land in question from rural to urban; and that Santander had
embarked on a venture of speculation, and that his evident purpose in recovering
the property from defendants was merely to resell the same at fabulous profits.
Wherefore, the lower court declared that plaintiffs could repurchase the land in
question from defendants, but at its present value of P60,000 or at the rate of
P3.00 per square meter; and furthermore recommended to the Director of Lands the
cancellation of Santander’s patent.

On appeal to this Court, plaintiffs-appellants raise a single question of
law, namely:

THE LOWER COURT ERRED IN ORDERING THE PLAINTIFFS-APPELLANTS TO PAY
DEFENDANTS-APPELLEES THE SUM OF SIXTY THOUSAND PESOS (P60,000.00) AS THE ALLEGED
REPURCHASE PRICE OF THE LITIGATED PORTION OF TWO HECTARES OF LAND WHICH FORMS
PART OF THE HOMESTEAD OF SAID APPELLANTS, NOTWITHSTANDING THE FACT THAT IT
PRONOUNCED THE NULLITY AND INVALIDITY OF THE DEED OF SALE (EXH. “1”) INVOLVING
SAID PORTION AND NOTWITHSTANDING FURTHER THE FACT THAT THE STIPULATED
CONSIDERATION THEREOF IS ONLY FOUR HUNDRED EIGHTY (P480.00) PESOS.

There is no question that the sale Exh. “1” was made within five years from
the issuance of appellant Santander’s homestead patent on July 29, 1937. It has
been the consistent ruling of this Court that conveyances of homestead of this
nature are null and void from inception (Eugenio v. Perdido, L-7063, May 19,
1955; Acierto v. De los Santos, L-5823, Sept. 29, 1954; De los Santos v. Roman
Catholic Church of Midsayap, 50 0. G. No. 4, 15&8; and others); and in line
with this precedent, the document Exh. “1” must be declared null and void, and
the land conveyed ordered returned to appellants upon their return to appellees
of the purchase price of P480.00.

The subsequent approval of the conveyance by the Secretary of Agriculture and
Natural Resources on August 2, 1947 could not have validated a sale that was
void from its inception. As we have held in the cases of De los Santos v. Roman
Catholic Church of Midsayap, supra, and Pascua v. Talens, 45 Off. G. No.
9 (Supp.) 413, the provision of law which prohibits the sale or encumbrance of
the homestead within five years after the grant of the patent is mandatory, and
can not be obviated even if official approval is granted beyond the expiration
of the period. Besides, the approval of the Secretary of Agriculture and
Commerce (Exhs. “3” and “3-A”) appears to have been given upon the erroneous
assumption that the patent was issued in 1936, in which case said sale would
have been executed after five years from the date of Santander’s patent and no
longer prohibited by law. The truth, however, is that Santander’s patent was
issued on July 29, 1937, and the sale Exh. “1” was made on February 26, 1942, or
within five years from the date of the patent. The approval of the Secretary
was, therefore, based on a mistake of fact, and as such is likewise void and of
no effect whatsoever.

The next point is whether, having held that the sale in question is null and
void, the lower court erred in ordering appellants to repurchase the land in
question from appellees at the price of P60,000, which it found to be the
present value of the property. In condemning appellants to repurchase at this
price, the Lower court had a dual objective: to penalize appellants whom it
found to have embarked m a venture of speculation over the homestead in
question, and to set a precedent to those who may commit similar violations of
the law in the future.

We agree with the court below that appellants should not
be allowed to take advantage of the salutary policy behind the Public Land Law
to enable them to recover the land in question from appellees only to dispose of
it again at much greater profit to themselves. But we find no legal sanction for
the judgment of the lower court requiring appellants to repurchase from
appellees, and at the property’s present value. The sale to appellees being null
and void ab initio, appellants never lost ownership over the land in
question, and appellees’ right is reduced to nothing more than to recover the
price paid by them for said land, which is only P480. No other relief may be
given appellees in this case, for they were themselves in pari delicto
with homesteader Santander in buying from him land which they should have known
could not be legally disposed of on the date of the sale in their favor.

In view, however, of the findings of the court below against appellant
Santander, we find it appropriate, as said court has done, to refer this case to
the Director of Lands for investigation and forfeiture of Vicente Santander’s
homestead under sec. 124 of the Public land Law, if the facts found would
warrant such forfeiture.

Wherefore, the decision appealed from is modified in the sense that
plaintiffs-appellants are ordered to return to appellees the sum of P480 and
appellees in turn to restore- appellants in the possession of the land in
question. In all other respects, the judgment appealed from is affirmed. No
costs.

So Ordered.

Paras, C.J., Bengzon, Padilla, Reyes, A., Bautista Angelo,
Labrador, Concepcion and Endencia, JJ., concur.