FELICIANA LICAYAN TALE, PETITIONER, VS. THE HONORABLE COURT OF APPEALS, THIRD DIVISION, AND PATERNO G. TALISIK, RESPONDENTS.

Tale versus Talisik

The Case

This is a petition for review brought by Feliciana Licayan Tale against the Court of Appeals and Paterno Talisik. The petitioner asks the Supreme Court to set aside the appellate decision that dismissed her complaint for reconveyance and damages on the sole ground of prescription. The case matters because it settles a conflict in the Court's own rulings: whether an action for reconveyance of land registered in another's name through fraud prescribes in four years or in ten years. It also shows how the Court treats the factual findings of the trial court when the appellate court never reached the question of ownership.

Procedural History

Feliciana Licayan Tale filed a complaint for reconveyance and damages against Paterno Talisik on August 19, 1977 with the Court of First Instance of Bukidnon. On August 16, 1989, the Regional Trial Court of Malaybalay, Bukidnon, Branch 9 rendered judgment in her favor. It declared her the owner of the contested portion, ordered the private respondent to execute a proper deed of conveyance, and directed him to cause a survey and segregation of that portion and deliver it to her.

Not satisfied, the private respondent appealed. The Court of Appeals reversed and set aside the trial court's decision and ordered the complaint dismissed, without costs, holding that the action for reconveyance based on fraud was barred by prescription because the four-year period had already expired. The petitioner's motion for reconsideration was denied. Hence, this petition for review before the Supreme Court.

Facts

Feliciana Licayan Tale, daughter of the deceased Agustin Licayan, inherited agricultural land covered by Original Certificate of Title Number 125, located in Casisang, Malaybalay, Bukidnon, with an area of about 15.5947 hectares. She paid the land taxes through a series of receipts dating back to 1950.

During the Second World War, Paterno Talisik, a war veteran, lived with Igmedio Tale, the petitioner's son. Damiano Tale gave his son-in-law Paterno Talisik a piece of agricultural land of around 2.5 hectares, which Damiano had bought from Dolores Dinulan.

Sometime in 1971, Paterno Talisik caused a portion of the petitioner's land, with an area of 2.2500 hectares, to be included in his Free Patent Number 50711, covered by Original Certificate of Title Number P-5827. His title thus covered an aggregate area of 5 hectares instead of only the 2.5 hectares given to him. The trial court found that the contested area lies to the north of the private respondent's land, and that he had encroached on the petitioner's land, which was already covered by a Free Patent in the name of her father. The trial court held that prescription could not set in because the portion claimed was previously covered by the title of the petitioner's predecessor.

Issues

• Whether or not the action for reconveyance based on fraud prescribes in four years, as the Court of Appeals held, or in ten years.
• Whether or not the petitioner's action, filed on August 19, 1977, counting from the issuance of the certificate of title on January 31, 1972, was filed within the prescriptive period.
• Whether or not the trial court's findings on the ownership of the contested 2.5 hectares should be upheld.

Applicable Provisions

Article 1144 of the Civil Code provides:

Article 1144. The following actions must be brought within ten years from the time of the right of action accrues: (1) Upon a written contract; (2) Upon an obligation created by law; (3) Upon a judgment.

This is the provision the Court applies, treating the obligation to reconvey as one created by law, so that the action prescribes in ten years.

Article 1456 of the Civil Code, as discussed in the decision, provides:

Article 1456. If property is acquired through mistake or fraud, the person obtaining it is, by force of law, considered a trustee of an implied trust for the benefit of the person from whom the property comes.

This is the source of the implied or constructive trust that gives rise to the obligation to reconvey, and it is the reason the ten-year period of Article 1144 governs.

Ruling

On the first issue, the Court held that the prescriptive period for an action for reconveyance based on fraud is ten years, not four. It relied on its earlier ruling in Amerol versus Bagumbaran, which explained that under the present Civil Code an implied or constructive trust is an offspring of the law, and so is the corresponding obligation to reconvey the property and the title to the true owner. The Court quoted the rule that an action for reconveyance based on an implied or constructive trust must perforce prescribe in ten years and not otherwise, counted from the issuance of the Torrens title over the property. The four-year rule of Balbin versus Medalla was explained as an erroneous reliance on an older case decided under the old Code of Civil Procedure, before the new Civil Code took effect.

On the second issue, the Court found that the period from the issuance of the certificate of title on January 31, 1972 to the filing of the action on August 19, 1977 was well within the ten-year period. The action was therefore not barred by prescription.

On the third issue, since the Court of Appeals had dismissed the case on prescription and never ruled on ownership, the Court examined the question itself. It agreed with the trial court. The petitioner inherited land covered by her father's title, while the private respondent received only 2.5 hectares. The sketch map showed that the contested area lay to the north of his land, and that he had encroached on the petitioner's land, holding more than 5 hectares under his title. The Court reiterated the well-settled rule that findings of trial courts are accorded great respect absent any showing that they ignored or overlooked matters of substance. It also found no reason to remand the case, since the private respondent's failure to secure new counsel within the period given was his own fault, and the case had already dragged for more than ten years.

Doctrine

An action for reconveyance based on an implied or constructive trust prescribes in ten years from the issuance of the Torrens title over the property, under Article 1144 of the Civil Code in relation to Article 1456. The obligation to reconvey is an obligation created by law, and the trust is an offspring of the law. The four-year period for actions for relief on the ground of fraud belonged to the old Code of Civil Procedure and does not govern actions for reconveyance under the present Civil Code. Findings of fact of the trial court are accorded great respect and will not be disturbed absent a showing that matters of substance were ignored or overlooked.

Disposition

The petition was granted. The Court set aside the decision of the Court of Appeals and its resolution denying reconsideration, and reinstated the decision of the Regional Trial Court of Malaybalay, Bukidnon, in favor of the petitioner.

Remember This

The single line to memorize: an action for reconveyance based on an implied or constructive trust prescribes in ten years from the issuance of the Torrens title, not four. Examiners use this case to test the prescriptive period for reconveyance and the conflict between the four-year and ten-year rules.