EUFEMIA PAJARILLO, CLAUDIO SUTERIO, JR., NYMIA SUTERIO AND MARILYN SUTERIO, PETITIONERS, VS. INTERMEDIATE APPELLATE COURT, THIRD CIVIL CASES DIVISION, SALUD SUTERIO AND PEDRO MA…

This is one of those
distasteful litigations involving a controversy among close relatives over
properties left by a common ascendant. 
The petitioners are the widow and children of the brother of the
principal private respondent.  She and
her brother appear to be the only remaining issue of the mother who seems to
have caused all the present confusion. 
The record does not show how close, if at all, the members of this small
family were.  What is certain is that
there is no affection now among the protagonists in this case.

The mother was Juana Balane de Suterio, who had a
brother named Felipe Balane and a sister named
Perfecta Balane de Cordero.  Perfecta died in 1945 leaving inter alia a tract of land consisting of about 28 hectares
and covered by TCT No. 4671 in the Registry of Deeds of Quezon Province.  On May 20,
1946, Juana and
Felipe executed a public instrument entitled “Extrajudicial Settlement of
the Estate of the Deceased Perfecta Balane de
Cordero.”^[1] In it they disposed of the said property as follows:

EXTRA-JUDICIAL SETTLEMENT OF THE ESTATE OF

DECEASED PERFECTA BALANE DE CORDERO.

This agreement made
this 20th day of May, 1946, by and
between Felipe Balane and Juana Balane
de Suterio, both of age and residents of Macalelon, Tayabas, Philippines.

W I T N E S S E T H:

That whereas, the said Felipe Balane and
Juana Balane de Suterio are
the only brother and sister respectively and forced heirs of Perfecta Balane de Cordero who dies intestate on January 21, 1945;

That whereas, the said Perfecta Balane de
Cordero, deceased, left property described as follows:

TRANSFER CERTIFICATE OF
TITLE NO. 4671.

Province of Tayabas.

A parcel of land (Lot No. 6-A, Plan Psu-12210), with all buildings
and improvements except those herein expressly noted as belonging to other
person, situated in the barrio of Luctol,
Municipality of Macalelon.  Bounded
on the NE., by Lot No. 6-B; on the E., by property by Andrea Fernandez, the sapa Luctob and the sapa Patay; on the SE., by
properties of Andrea Fernandez and Silvestra Mereis; on the SW., by properties of Felix Rodriguez, Dionisio Fornea, Placido Abistado and Adriano Abistado and the mangrove of the government; and on Nw., by properties of Orilleneda,
Mariano Glindro, Maxima Orilleneda,
Placida Forcados and Basilio Rabe.  xx xx xx xx xx xx xx containing an
area of TWO HUNDRED EIGHTY-FIVE THOUSAND THREE HUNDRED FIFTY-THREE SQUARE
METERS (285,353) more or less.

That whereas, we Felipe Balane and Juana Balane de Suterio, the only heirs
of the property described above left by the deceased Perfecta Balane de Cordero, do hereby agree in carrying out the antemortem wish of our beloved deceased sister
that in consideration of love and affection the property described above be
donated to Salud Suterio de
Matias.

That whereas, the estate left by the said Perfecta Balane de Castro, deceased, is not free from obligation or
debt.  It has an incumbrance
of about ONE THOUSAND PESOS (P1,000.00) to the Philippine National Bank, Tayabas Branch.

That whereas, Salud Suterio
de Matias, to whom this property is donated
extra-judicially as agreed upon by both heirs, shall assume the said obligation to the Philippine National
Bank, Tayabas Branch.

NOW, THEREFORE, we Felipe Balane and
Juana Balane de Suterio
have mutually agreed and covenanted to adjudicate, give, transfer and convey the property described above to Salud Suterio de Matias heirs, executors, administrators and assign.

And the donee does hereby accept this
donation and does hereby express her gratitude for the kindness and liberality
of the donor.

IN WITNESS WHEREOF, we have hereunto set our hands this 20th day of
May, 1946.

(Sgd.)  FELIPE BALANE

FELIPE BALANE

(Sgd.)  JUANA BALANE DE SUTERIO

JUANA BALANE DE
SUTERIO

(Acknowledgment)

On June 20, 1946,
Salud Suterio executed the
following public instrument,^[2]
with petitioner Eufemia Pajarillo
was one of the witnesses:

KNOW ALL MEN BY THESE PRESENTS:

That on May 20, 1946, FELIPE BALANE and JUANA BALANE DE SUTERIO,
the only heirs to the properties of the late PERFECTA BALANE DE CORDERO,
executed a DEED OF DONATION in favor of the undersigned and the said donation
was made in accordance to the antemortem wish
of my late aunt, Perfecta Balane de Cordero, to the
effect that the property described in the Deed of Donation, be given to me
because of her love and affection for
me, being her only niece.

That, I, SALUD SUTERIO DE MATIAS, the only DONEE, do hereby receive
and accept this donation and further express my gratitude for the kindness and
liberality of the DONORS, FELIPE BALANE and JUANA BALANE DE SUTERIO.

IN WITNESS WHEREOF, I have hereunto set my hand this 20th day of
June, 1946.

(Sgd.)  SALUD SUTERIO DE MATIAS

SALUD SUTERIO DE MATIAS

Donee

Signed in the presence of:

(Sgd.)
SOFRONIO BALANE

(Sgd.)
EUFEMIA P. SUTERIO

(Acknowledgment)

These instruments were never registered nor was
title transferred in Salud’s name although she says
she immediately took possession of the land. 
Meantime, intestate proceedings were instituted on the estate of
Perfecta and the said land was among those included in the inventory of the properties belonging to the
decedent.^[3] Salud interposed no objection
to its inclusion nor did she oppose its subsequent adjudication to her mother
Juana in the project of partition.  It is
not clear if the land was ever registered in Juana’s name.  However, there is evidence that Juana
confirmed the earlier donation of the land to Salud but requested that she
be allowed to possess the same and enjoy its fruits until her death.^[4] It has also not been controverted
that Salud paid the P1,000.00 loan for which the land was mortgaged.

Salud says that sometime in 1951, acceding to this
request, she transferred the possession of the land to her mother, who was then
staying with Claudio and his family. 
During the period they were occupying the land, Claudio
paid the realty taxes thereon.^[5] On May 25, 1956, Juana executed a deed of
absolute sale conveying the land to Claudio for the declared
consideration of P12,000.00.^[6] Two years later, on August
27, 1958, Claudio had the land registered in his name and was issued TCT No. 32050 in the land records of Quezon Province.^[7]

Claudio died in 1961 and
his mother in 1963.  On June 30,
1965, the private respondents filed a complaint for the reconveyance
of the property on the ground that the deed of sale in favor of Claudio was fictitious and its registration in
his name was null and void.^[8]

Salud (joined by her husband) alleged that she was
unaware until later of the supposed sale of the land to Claudio.  She faulted it as having been procured
through fraud and improper influence on her sick and aged mother.  She claimed
that no compensation was actually paid by Claudio and that the transaction was
deliberately concealed from her by her brother and the defendants.^[9] For their part, the defendants assailed the
donation to Salud as legally inefficacious and
defective and contended that her
complaint was barred by prescription, estoppel and res judicata.  They also filed a counterclaim questioning
the sale to Salud by her mother of another tract of
land, in which they said they were entitled to share as Juana’s heirs.^[10]

On April
17, 1979, Judge Juan
M. Montecillo of the Court of First Instance of Quezon rendered judgment upholding the donation to the
plaintiff and annulling the deed of sale and the registration of the land in favor of Claudio Suterio, Sr.  The defendants were required to reconvey the land to Salud Suterio even as
their counterclaim was dismissed
for lack of evidence.^[11]

On appeal, the decision was affirmed in toto.^[12] The
respondent court is now sought
to be reversed in this petition for certiorari under
Rule 45 of the Rules of Court.

We hold at the
outset that, contrary to the ruling in the challenged decision, the petitioners
have the legal personality to challenge the validity of the donation on which Salud bases her claim to the property under
litigation.  As defendants in the complaint for reconveyance,
they had every right to resist the plaintiffs’ allegation that she was the owner of the subject property by virtue of the claimed
donation.  Recognition of that donation
would topple the props of their own contention that Juana could dispose of the
property as its owner when she sold it to Claudio Suterio
in 1956.

The petitioners also assail the intrinsic validity of the extrajudical settlement and submit that it is not really a
donation as conceptually understood in civil law.  Their argument is that the real donor of the property was Perfecta, the
deceased sister, who, however, could no longer bestow the intended gift.  For their part, Felipe and Juana could not
have made the donation either because they were not moved by the same
sentiments Perfecta had for her niece Salud.  That feeling would have provided the required
consideration if Perfecta herself had made the donation, but not the other two.

This appears to be too
much nitpicking, if not sophistry. 
Felipe and Juana had declared themselves the heirs of Perfecta and the
owners of the property in question.  As
such, they were free to give the land to whomever they pleased and for whatever
reason they saw fit.  Hence, if they chose to respect Perfecta’s
wishes and carry out her intentions by donating the land to Salud,
there was no legal impediment to their doing so.  In fact, that was not only the legal but also
the moral thing to do.

There is no question that
Felipe and Juana could have simply disregarded their sister’s sentiments and
decided not to donate the property to Salud, keeping
the same for themselves.  The fact that
they did not do this speaks well indeed of their integrity and their loyalty as
well to their deceased sister. 
The extrajudicial settlement also reflects their own affection for Salud which constituted the valid consideration for their
own act of liberality.  Notably, in her
acceptance of the donation, Salud referred to
“the donors Felipe Balane and Juana Balane de Suterio,” and not
Perfecta.

It is also pointed out
that the donation is defective in form because of non-compliance with
the requirements of the law
regarding its acceptance.  As it was
executed in 1946, the applicable rule is Article 633 of the old Civil Code
reading as follows:

Art. 633.  In order that a
donation of real property be valid it must be made by
public instrument in which the property donated must be specifically described
and the amount of the charges to be assumed by the donee
expressed.

The acceptance may be made in the deed of gift or in a separate public writing; but it shall produce no effect if not made during
the lifetime of the donor.

If the acceptance is made by separate public instrument, authentic
notice thereof shall be given the donor, and this proceeding shall be noted in
both instruments.

There is no question that
the donation was accepted in a separate public instrument and that it was duly
communicated to the donors.  Even the
petitioners cannot deny this.  But
what they do contend is that such acceptance was not “noted in both
instruments,” meaning the extrajudicial partition itself and the
instrument of acceptance, as required by the Civil Code.

That is perfectly
true.  There is nothing in either of the
two instruments showing that “authentic notice” of the acceptance was
made by Salud to Juana and Felipe.  And while the first instrument contains the
statement that “the donee does hereby accept
this donation and does hereby express her gratitude for the kindness and
liberality of the donor,” the only signatories thereof were Felipe Balane and Juana Balane de Suterio.  That was in
fact the reason for the separate instrument of acceptance signed by Salud a month later.

A strict interpretation
of Article 633 can lead to no other conclusion than the annulment of the donation
for being defective in form as urged by the petitioners.  This would be in keeping with the unmistakable language of the above-quoted
provision.  However, we find that under
the circumstances of the present case, a literal adherence to the
requirement of the law might result not in justice to the parties but
conversely a distortion of their intentions.  It is also a policy of the Court to
avoid such an intepretation.

The purpose of the formal
requirement is to insure that the acceptance of the donation is duly
communicated to the donor.  In the case
at bar, it is not even suggested that Juana was unaware of the acceptance for
she in fact confirmed it later and requested that the donated land be not
registered during her lifetime by Salud.^[13] Given this significant evidence, the Court
cannot in conscience declare the donation ineffective because there is no
notation in the extrajudicial settlement of the donee’s
acceptance.  That would be placing too much stress  on mere form over
substance.  It would also disregard the
clear reality of the acceptance of the donation as manifested in the separate
instrument dated June 20, 1946, and as later acknowledged by Juana.

The cases cited by the
parties in their respective memoranda are not really in point.  In Legasto v. Verzosa,^[14] there was no evidence whatsoever that the
claimed donations had been accepted, as stressed by Justice Villa-Real.  The same observation is made of Santos v. Robledo,^[15] where Justice Torres noted that the
acceptance of the donation did not appear in the deed of donation or in any
other instrument.

The petitioners would also fault the private respondents for laches and argue that Salud’s
inaction in protection of her rights should bar her from asserting them at this late hour.  Specifically, it is pointed out that she
failed to register the deed of donation and its acceptance in 1946; did not
oppose the inclusion of the subject land in the inventory of Perfecta’s
properties submitted in the intestate proceedings in 1946; did not object to
the adjudication of the land to Juana in the project of partition in 1951; did
not protest the sale of the land to Claudio Suterio
in 1956; and did not question its registration in his name in 1958.  It is contended that all these acts
constitute laches, which has been described by this
Court thus:

An estoppel by laches
arises from the negligence or omission to assert a right within a reasonable
time, warranting a presumption that the party entitled to assert it either has
abandoned it or declined to assert it.^[16]

The problem with the petitioners’ theory is that it would regard
Juana and Salud as strangers when they are in fact
mother and daughter.  One may expect a
person to be vigilant of his rights when dealing with an acquaintance or
associate, or even with a friend, but not when the other person is a close relative, as in the case at
bar.  To begin with, the land came from Juana herself.  Secondly, she requested her daughter not to
register the land as long as she was still alive so she could enjoy its
fruits until her death.  To Salud, it was not difficult to comply with this
request, coming as it did from her own mother. 
There was no reason to disobey her. 
She did not have to protect herself against her own mother.  Indeed, what would have been unseemly was her
registering the land against her mother’s request as if she had no confidence
in her.  Salud
did no less than what any dutiful daughter would have done under the
circumstances.

If Salud did not protest the inclusion
of the land in the inventory of Perfecta’s properties and its subsequent
adjudication to Juana in the intestate proceedings, it was because she did not
feel threatened by these acts.  She did
not distrust her mother.  Moreover, Juana
had herself acknowledged the donation when she was asked in whose name the
property would be registered following the intestate proceedings.  Salud felt safe
because she had the extrajudicial
settlement to rely on to prove that her mother and her uncle had donated the
subject land to her.

There is nothing in this instrument to suggest that the donation
was to take effect upon the death of the donors as to make it a donation mortis
causa, as urged by the petitioners.  The donation became effective upon acceptance
by Salud except that, in obedience to her mother’s request, she chose not to register
the land in the meantime and to allow her mother to enjoy its fruits.  What was deferred was not its effectivity but only its enjoyment by Salud.  Registration
was not necessary to make the donation a binding commitment insofar as the donors and the donee were concerned.^[17]

As for her inaction against the deed of sale in
favor of her brother Claudio, it should be noted in the first place that she
was not aware of it when it was executed in 1956.  Her mother, who was already 76 years old at the time, never
informed her about it, nor did her brother or any of the
defendants, for reasons of their own.  It
was only later, when the sale was registered in 1958 and a new
title to the land was issued to Claudio,
that she started asking questions. 
Even then, being a sister
to Claudio, she did not immediately take legal steps.

It is natural, even among
non-relatives, to seek a non-judicial settlement through extra-legal measures
before going to court. 
It is more so in the case of relatives, who should avoid as much as possible the asperity and bitterness
of litigation.  That is what Salud did when she repeatedly asked the petitioners for the
return of the property albeit to no avail. 
It was only when it became clear that amicable persuasion was not possible that she decided to sue the wife and children of her
departed brother.

The petitioners stress that
it took Salud
all of seven years from the registration of the land in Claudio’s name before she filed the complaint for reconveyance against them. 
That is true.  But if one
remembers that her brother died only in 1961 and her own mother only in 1963, at the age of 83, it will be easy to
understand the reason for
the delay, which would otherwise have been unjustified.  Suits among brothers and sisters are especially painful to their parents.  Salud must have
thought many times about filing her complaint against her brother Claudio while
her old mother was still alive.  In fact,
Salud hesitated still even after her mother’s death
and took two more years before she finally filed her complaint against
Claudio’s wife and children.

It is clear that Juana Balane de Suterio had no right to
sell the subject land to Claudio because she was no longer its owner, having
previously donated it to her daughter Salud.  Juana herself was holding the land merely as a trustee of Salud, who had transferred
possession to her mother at the old woman’s request.  The deed of sale was itself vitiated by bad
faith as Claudio is presumed to have known of the previous donation to his
sister Salud, whose acceptance of the donation was
formally witnessed by his own wife, the herein principal petitioner.^[18] When Claudio registered the land in his name
knowing there was a flaw in his title, an implied trust was created in favor of
Salud as the real owner of the property in accordance
with Article 1456 of the Civil Code, reading as follows:

If the 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.

As trustor, Salud
had every right to sue for the recovery of the land in the action for reconveyance against Claudio’s heirs.  As we said in Vda. de Jacinto, et al. v. Vda. de Jacinto, et al.:^[19]

Public policy demands
that a person guilty of fraud or at least, of breach of trust, should not be
allowed to use a Torrens title as a shield against the consequences of his own
wrongdoing.

The petitioners do not
insist on prescription as a bar to the action for reconveyance, and
understandably so.  The legal principle
is that if the registration of the land is fraudulent and the person in whose
name the land is registered thus holds it as a mere trustee, the real owner is entitled to file an action for reconveyance of the property within a period of ten
years.  As we have held in many cases:

Where the action is one for reconveyance
based on constructive trust, a ten-year period is allowed.^[20]

An action for reconveyance of realty,
based upon a constructive or implied trust resulting from fraud, may be barred
by prescription.  The prescriptive period
is reckoned from the issuance of the title which operates as a constructive
notice.^[21]

While actions to enforce a constructive trust prescribe in 10 years
from registration of the property, private respondents’ right commenced from
actual discovery of petitioner’s act of defraudation.^[22]

The record shows that
while the land was registered in the name of Claudio Suterio,
Sr. in 1958, the complaint for reconveyance was filed by the petitioners in 1965, or still
within the ten-year prescriptive period.

The last issue raised by the petitioners, viz., the
validity of the deed of sale executed by Juana Balane
de Suterio on January
29, 1950, in favor of Salud Suterio,^[23]
need not detain us too long.  The trial
court sustained the contract for lack
of sufficient evidence to invalidate it and was upheld by the respondent
court.  We see no reason to disturb their
factual finding, absent a showing that it was reached arbitrarily.  Interestingly, it occurred to the petitioners
to question the transaction only when they were sued by the private
respondents, after fifteen years from the date of the sale.  This is an even longer period than the nine years during
which the petitioners say Salud Suterio
was sleeping on her rights following the sale of her land to Claudio Suterio.

WHEREFORE, the petition is DENIED, with costs against the
petitioners.  It is so ordered.

Narvasa, (Chairman), Gancayco, Griño-Aquino, and Medialdea, JJ., concur.

^[1]
Exhibit “A.”

^[2]
Exhibit “B.”

^[3]
Exhibit
“12-A.”

^[4]
Exhibit “D.”

^[5]
Exhibits “4” to
“4-G.”

^[6]
Exhibit
“1.”

^[7]
Exhibit
“2.”

^[8]
Record on Appeal, p. 1.

^[9]
Ibid., pp. 4-5.

^[10]
Id., p. 27.

^[11]
id., p. 69.

^[12]
Rollo, p. 46. 
Penned by Ejercito, J.,
with Coquia, Zosa and Bartolome, JJ., concurring.

^[13]
TSN, January 15, 1970, p. 54.

^[14]
54 Phil 766.

^[15]
28 Phil. 245.

^[16]
Tijam, et al. v. Sibonghanoy,
23 SCRA 29.

^[17]
Sapto, et al.
v. Fabiana, 103 Phil. 683.

^[18]
Exhibit “B.”

^[19]
115 Phil. 263.

^[20]
Quiñiano v. Court of
Appeals, 39 SCRA 221.

^[21]
Sinaon v. Soroñgon,
136 SCRA 407.

^[22]
Adille v. Court of
Appeals, 157 SCRA 455.

^[23]
Exhibit “Q.”