THE GOVERNMENT OP THE PHILIPPINE ISLANDS, PETITIONER, VS. ANASTASIA ABADILLA ET AL., CLAIMANTS. THE MUNICIPALITY OF TAYABAS ET AL., CLAIMANTS AND APPELLEES, 33MARIA PALAD ET AL.…

OSTRAND, J.:

This is an appeal from a judgment in cadastral land registration case No. 3
of the Court of First Instance of Tayabas (G. L. R. 0. Record No. 213) in which
case lots Nos. 3464, 3469, and 3470 are claimed by the municipality of Tayabas
and the governor of the province on one side, and by Maria, Eufemio, Eugenia,
Felix, Caridad, Segunda, and Emilia Palad on the other. Lot No. 3470 is also
claimed by Dorotea Lopez. The court below ordered the registration of all three
lots in the name of the governor of the Province of Tayabas in trust for a
secondary school to be established in the municipality of Tayabas. The claimants
Palad and Dorotea Lopez appealed.

It appears from the evidence that the lands in question were originally owned
by one Luis Palad, a school teacher, who obtained title to the land by
composicion gratuita in 1894. On January 25, 1892, Palad executed a
holographic will partly in Spanish and partly in Tagalog. Palad died on December
3, 1896, without descendants, but leaving a widow, the appellant Dorotea Lopez,
to whom he had been married since October 4, 1885. On July 27, 1897, the Court
of First Instance of Tayabas ordered the protocolization of the will over the
opposition of Leopoldo and Policarpio Palad, collateral heirs of the deceased
and of whom the appellants Palad are descendants.

The will contained a clause in Tagalog which, translated into English,
reads:

“That the cocoanut land in Colongcolong, which I have put under cultivation,
be used by my wife after my death during her life or until she marries, which
property is referred to in the inventory under No. 5, but from this cocoanut
land shall be taken what is to be lent to the persons who are to plant cocoanut
trees and that which is to be paid to them as their share of the crop if any
should remain; and that she try to earn with the product of the cocoanut trees
of which those bearing fruit are annually increasing; and if the times
aforementioned should arrive, I prepare and donate it to a secondary college to
be’erected in the capital of Tayabas; so this will be delivered by my wife and
the executors to the Ayuntamiento of this town, should there be any,
and if not, to the civil governor of this province in order to cause the manager
thereof to comply with my wishes for the good of many and the welfare of the
town.”

After the death of Luis Palad the widow Dorotea Lopez remained in possession
of the land and in the year 1900 married one Calixto Dolendo. On April 20,1903,
the aforesaid collateral heirs of Luis Palad brought an action against the widow
for the partition of the lands here in question on the ground that she, by
reason of her second marriage, had lost the right to their exclusive use and
possession. In the same action the municipality of Tayabas intervened claiming
the land under the clause of the Palad will above quoted. During the pendency of
the action an agreement was arrived at by the parties under which the land which
now constitutes lots Nos. 3464 and 3469 were turned over to the municipality as
its share of the inheritance under the will, and the remaining portion of the
land in controversy and which now forms lot No. 3470 was left in the possession
of Dorotea Lopez. On the strength of the agreement the action was dismissed on
November 9, 1904, upon motion by the counsel for the municipality and concurred
in by all the parties, reserving to the collateral heirs the right to bring
another action. The municipality of Tayabas has been in possession of said lots
Nos. 3464 and 3469 ever since and Dorotea Lopez has likewise held uninterrupted
possession of lot No. 3470.

In regard to lots Nos. 3464 and 3469, claimed by the appellants Palad and the
appellees, the case presents several problems not directly covered by statutory
provisions or by Spanish or local precedents and, for the solution of which, we
must resort to the underlying principles of the law on the subject. As it is
doubtful whether the possession of the municipality of Tayabas can be considered
adverse within the meaning of section 41 of the Code of Civil Procedure, the
case as to these lots turns upon the construction and validity of the clause
quoted from the will of Luis Palad, rather than upon the question of
prescription of title.

The clause is very unskillfully drawn; its language is ungrammatical and at
first blush seems somewhat obscure, but on closer examination it sufficiently
reveals the purpose of the testator. And if its provisions are not in
contravention of some established rule of law or public policy, they must be
respected and given effect. It may be observed that the question as to the
sufficiency of the form of the will must be regarded as settled by the
protocolization proceedings had in the year 1897.

It is a well-known rule that testamentary dispositions must be liberally
construed so as to give effect to the intention of the testator as revealed by
the will itself. Applying this rule of construction it seems evident that by tne
clause in question the testator proposed to create a trust for the benefit of a
secondary school to be established in the town of Tayabas, naming as trustee the
ayuntamiento of the town or if there be no ayuntamiento, then the civil
governor of the Province of Tayabas.

As the law of trusts has been much more frequently applied in England and in
the United States than it has in Spain, we may draw freely upon American
precedents in determining the effect of the testamentary trust here under
consideration, especially so as the trusts known to American and English equity
jurisprudence are derived from the fidei commissa of the Roman law and
are based entirely upon Civil Law principles.

In order that a trust may become effective there must, of course, be a
trustee and a cestui que trust, and counsel for the appellants Palad argues that
we here have neither; that there is no ayuntamiento, no Gobernador
Civil of the province, and no secondary school in the town of Tayabas.

An ayuntamiento corresponds to what in English is termed a municipal
corporation and it may be conceded that the ordinary municipal government in
these Islands falls short of being such a corporation. But we have provincial
governors who like their predecessors, the civil governors, are the chief
executives of their respective provinces. It is true that in a few details the
functions and powers of the two offices may vary somewhat, but it cannot be
successfully disputed that one office is the legal successor of the other. It
might as well be contended that when under the present regime the title of the
chief executive of the Philippines was changed from Civil Governor to that of
Governor-General, the latter was not the legal successor of the former. There
can therefore be but very little doubt that the governor of the Province of
Tayabas, as the successor of the civil governor of the province under the
Spanish regime, may act as trustee in the present case.

In regard to private trusts it is not always necessary that the cestui
que trust should be named, or even be in esse at the time the trust is
created in his favor. (Flint on Trusts and Trustees, section 25; citing Frazier
vs. Frazier, 2 Hill Ch., 305; Ashurst vs. Given, 5 Watts &
S., 329; Carson vs. Carson, 1 Wins. [N. C], 24.) Thus a devise to a
father in trust for accumulation for his children lawfully begotten at the time
of his death has been held to be good although the fajther had no children at
the time of the vesting of the funds in him as trustee. In charitable trusts
such as the one here under discussion, the rule is still further relaxed. (Perry
on Trusts, 5th ed., section 66.)

This principle is in harmony with article 788 of the Civil Code which reads
as follows:

“Any disposition which imposes upon an heir the obligation of periodically
investing specified sums in charitable works, such as dowries for poor maidens
or scholarships for students, or in favor of the poor, or any charitable or
public educational institution, shall be valid under the following
conditions:

“If the charge is imposed on real property and is temporary, the heir or
heirs may dispose f of the encumbered estate, but the lien shall continue until
the record thereof is canceled.

“If the charge is perpetual, the heir may capitalize it and invest the
capital at interest, fully secured by first mortgage.

“The capitalization and investment of the principal shall be made with the
intervention of the civil governor of the province after hearing the opinion of
the prosecuting officer.

“In any case, if the testator should not have laid down any rules for the
management and application of the charitable legacy, it shall be done by the
executive authorities upon whom this duty devolves by law.”

It is true that minor distinctions may possibly be drawn between the case
before us and that presupposed in the article quoted, but the general principle
is the same in both cases. Here the trustee, who holds the legal title, as
distinguished from the beneficial title resting in the cestui que trust, must be
considered the heir. The devise under consideration does not in terms require
periodical investments of specified sums, but it is difficult to see how this
can affect the general principle involved, and unless the devise contravenes
some other provision of the Code it must be upheld.

We have been unable to find any such provision. There is no violation of any
rule against perpetuities: the devise does not prohibit the alienation of the
land devised. It does not violate article 670 of the Code: the making of the
will and the continuance or quantity of the estate of the heir are not left in
the discretion of a third party. The devisee is not uncertain and the devise is
therefore not repugnant to article 750 of the Civil Code. The provincial
governor can hardly be regarded as a public establishment within the meaning of
article 748 and may therefore receive the inheritance without the previous
approval of the Government.

But counsel argues that assuming all this to be true the collateral heirs of
the deceased would nevertheless be entitled to the income of the land until the
cestui que trust is actually in esse. We do not think so. If
the trustee holds the legal title and the devise is valid, the natural heirs of
the deceased have no remaining interest in the land except their right to the
reversion in the event the devise for some reason should fail, an event which
has not as yet taken place. From a reading of the testamentary clause under
discussion it seems quite evident that the intention of the testator was to have
the income of the property accumulate for the benefit of the proposed school
until the same should be established.

From what has been said it follows that the judgment appealed from must be
affirmed in regard to lots Nos. 3464 and 3469.

As to lot No. 3470 little need be said. It may be noted that though the
Statute of Limitations does not run as between trustee and cestui que
trust as long as the trust relations subsist, it may run as between the trust
and third persons. Contending that the Colongcolong land was community property
of her marriage with Luis Palad and that lot No. 3470 represented her share
thereof, Dorotea Lopez has held possession of said lot, adverse to all other
claimants, since the year 1904 and has now acquired title by prescription.

The judgment appealed from is affirmed in regard to lots Nos. 3464 and 3469
and is reversed as to lot No. 3470, and it is ordered that said lot No. 3470 be
registered in the name of the claimant Dorotea Lopez. No costs will be allowed.
So ordered.

Street, Avanceña, Villamor, and Romualdez, JJ.,
concur.

CONCURRING AND DISSENTING OPINION

MALCOLM, J.:

I concur in regard to lots Nos. 3464 and 3469 and dissent in regard to lot
No. 3470. As to the last mentioned lot, it will be recalled that title to it is
adjudicated to Dorotea Lopez, the widow of Luis Palad who, in his will,
transmitted the usufructuary rights to the land to his widow “during her life or
until she marries,” after which the property was to be delivered to the
ayuntamiento of Tayabas, Tayabas, or if there should not be any, to the
civil governor of the Province of Tayabas, for the benefit of a secondary
college. Dorotea Lopez having remarried, the property should have been turned
over to the municipality of Tayabas. The alleged agreement of 1904 cannot alter
these basic and controlling facts. The possession of Dorotea Lopez has been in
contravention of the terms of the trust and in bad faith.

Whatever may be the rule elsewhere, in civil law jurisdictions including the
Philippines, it is. settled that to perfect title by adverse possession, such
possession must have been held in good faith on the part of the claimant.
(Arriola vs. Gomez de la Serna [1909], 14 Phil., 627; Santiago
vs. Cruz [1911], 19 Phil., 145; Cuaycong vs. Benedicto [1918],
37 Phil., 781; Tolentino vs. Vitug [1918], 39 Phil, 126; Ochoa
vs. Hernandez [1913], 230 U. S., 139; Kennedy vs. Townsley
[1849], 16 Ala., 239; Abshire vs. Lege [1913], 133 La., 254; 2 C. J.,
199.) The doctrines announced in Tolentino vs. Vitug, supra,
are particularly applicable to the facts.

For these reasons, I would prefer to see the judgment appealed from affirmed
in all respects.