AQUILINO DE LA CERNA AND APOLINARIO DE LA CERNA, PLAINTIFFS-APPELLANTS, VS. LOURDES DE LA CERNA AND MIGUEL DE LA CERNA, DEFENDANTS-APPELLEES.

De la Cerna versus De la Cerna

The Case

This is the case of De la Cerna versus De la Cerna. Aquilino de la Cerna and Apolinario de la Cerna sued Lourdes de la Cerna and Miguel de la Cerna for partition and reconveyance of a parcel of residential land in Davao City, with damages. The plaintiffs claimed to be children of the late Narciso de la Cerna by an earlier marriage, and they asserted that the property had been settled among the surviving heirs in a way that excluded them. The case matters because it shows how the statute of limitations runs against a claim of constructive trust: registration of an instrument of partition is constructive notice to the whole world, and from that registration the period to seek reconveyance begins to run.

Procedural History

The action was filed in the Court of First Instance of Davao. The defendants set up, among their affirmative defenses, that the action had already prescribed. After a pre-trial in which the parties failed to agree on any point, the trial court held a preliminary hearing on that defense and, in an order dated July 28, 1967, dismissed the complaint on the ground of prescription, without pronouncement as to costs. The plaintiffs moved for reconsideration, and the motion was denied. The plaintiffs then brought a direct appeal to the Supreme Court, assigning as their sole error that the trial court erred in dismissing the complaint on the ground of prescription without a trial on the merits.

Facts

During the marriage of Narciso de la Cerna and Eladia Bustamante, the spouses acquired a parcel of residential land on San Roque Street in Davao City, with an area of 5,006 square meters, covered by a transfer certificate of title. Narciso died on October 20, 1945. On August 26, 1946, his surviving wife Eladia and their two children, Lourdes and Melecio, executed a deed of extra-judicial partition. By that deed they settled the hereditary estate among themselves as co-owners in undivided shares: one half of the land to the wife Eladia, and the remaining half to the children Lourdes and Melecio.

The deed of extra-judicial partition was registered in the Office of the Register of Deeds of Davao on September 4, 1946, and on the strength of that registration a new title was issued in their names. Then, sometime in 1949, Melecio ceded his share to his sister Lourdes, in whose name title was duly issued.

On February 27, 1967, more than twenty years later, Aquilino and Apolinario de la Cerna, claiming to be children of the late Narciso by his alleged first wife Eulalia Quesada, together with another brother, Antonio, instituted the action for partition and reconveyance against Lourdes. They joined their own brother Antonio as a defendant for being an unwilling co-plaintiff. The defendants answered, setting up the affirmative defenses that the property was the paraphernal property of Eladia, that the action had prescribed, and that the complaint stated no cause of action.

Issues

• Whether or not the action for partition and reconveyance of the property had already prescribed.
• Whether or not the trial court erred in dismissing the complaint on the ground of prescription without a trial on the merits.

Applicable Provisions

The decision applies the law of prescription in force prior to the Civil Code, as provided in Article 1116 of the Civil Code, which the concurring opinion invokes. That article provides:

Article 1116. The prescriptions already running at the time this Code takes effect shall continue to run, subject to the provisions of this Code.

This bears on the case because the partition and the registration occurred in 1946, before the Civil Code took effect, so the prescriptive periods are counted under the earlier law.

The decision also rests on the rule that an action for reconveyance based on an implied or constructive trust prescribes in ten years, as stated in the jurisprudence it quotes:

The prescriptibility of an action for reconveyance based on implied or constructive trust, is now a settled question in this jurisdiction. It prescribes in ten years.

This bears on the case because, even on the longer ten-year period, the plaintiffs filed their action more than twenty years after the registration that gave them constructive notice.

Ruling

On the first issue, the Court held that the action had prescribed. It is settled that the registration of the extra-judicial partition is deemed constructive notice that the defendant had repudiated the alleged fiduciary or trust relationship between her and the plaintiffs over the property, and had thereby set up a title adverse to them, as in fact a new title was issued on the strength of that registration. The plaintiffs filed their action only on February 27, 1967, about twenty and a half years after that registration and the issuance of the new title in the defendant's name.

The Court added that it is idle to bother whether the action is one founded exclusively on fraud, which prescribes in four years, or one based on constructive trust, which is barred after ten years, because there is no question that the appellees secured their title more than twenty years before the filing of the complaint, and it is from the date of the issuance of that title that the effective assertion of adverse title is counted for purposes of the statute of limitations. The Court quoted with approval the rule that the discovery of fraud is deemed to have taken place when the instrument was filed with the Register of Deeds and new certificates of title were issued, for the registration of the deed of extra-judicial settlement constitutes constructive notice to the whole world.

On the second issue, the Court held that the trial court committed no error. Since the action had plainly prescribed on the face of the record, the dismissal after a preliminary hearing on the affirmative defense was proper, and no trial on the merits was required.

Doctrine

A Bar candidate should retain these rules. First, the registration of a deed of extra-judicial partition is constructive notice to the whole world, and it operates as the repudiation of any alleged fiduciary or trust relationship over the property, setting up a title adverse to those who claim against it. Second, an action for reconveyance based on an implied or constructive trust prescribes in ten years, counted from the date of the issuance of the new title, which is the effective assertion of the adverse title. Third, an action to annul a deed on the ground of fraud prescribes in four years from the discovery of the fraud, and that discovery is deemed to have taken place upon registration of the instrument, because registration is constructive notice. Fourth, where prescription is apparent on the face of the complaint and is set up as an affirmative defense, the court may dismiss the case after a preliminary hearing without a full trial on the merits.

Disposition

The Supreme Court affirmed the order of dismissal, with costs against the plaintiffs-appellants.

Remember This

The single line worth memorizing is that registration of the deed of extra-judicial partition is constructive notice to the whole world, and from that registration the ten-year period to seek reconveyance on a constructive trust begins to run. Examiners like to use this case to test whether a late claim for reconveyance is barred by prescription, and whether a court may dismiss on that ground after a preliminary hearing without a trial on the merits.