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Ana Callejon Salinas, et al. v. Felisa Roman Tuason and Jose Moreno Roman GR No.

L-33626 March 2, 1931 Johnson, J. Doctrine: As a general rule, a trust estate is exempt from the operation of the statute of limitations. A trustee, however, may acquire the trust estate by prescription provided there is repudiation of the trust and this fact is known to the cestui que trust. The repudiation must be clear, open and unequivocal. Facts: Francisco Callejon Salinas former resident of the Philippines, died in Spain on May 31, 1911 (no record when he left the Phils) In 1900 Salinas appointed Teodosio Pintado y Fernandez as his attorney in fact to administer his properties in the Philippines, with express authority to delegate his powers as such attorney or to appoint his successor. On April 24, 1905 Fernandez appointed Jose Moreno Lahaba as attorney in fact or agent for Salinas. Lahaba administered the properties and rendered accounts until 1911, the death of his principal. He had not, however, rendered any report of his administration in spite inquiries made by the heirs of his principal from July, 1911 up to the time of his death in 1920. Among the properties administered were the 2 parcels of land in question. Sometime before the death of Lahaba, the Spanish Consul in the Philippines, at the request of the heirs of Salinas, made inquiries from Lahaba about the properties administered by him. He said he had only P2,500 in his possession belonging to his principal, which he was ready to deliver upon the production of written authority from the heirs for the consul to receive the same. Pending the receipt of said authority, Lahaba died. The consul presented a claim for P2,500 to the intestate proceedings of Lahaba which was allowed and paid and delivered to the heirs of Salinas. After the receipt of the said amount, the heirs of Salinas requested the Spanish Consul to make further inquiries about the other properties. It was discovered that Lahaba had sold in the name of Salinas the 2 parcels of land to Tomas Luis for P30,000, on installment. Five days after the sale, the vendee executed a mortgage on said lands in favor of Lahaba for P25,000 to secure the unpaid balance of the price (P5,000 paid already). When Lahaba died, a balance of P20,000 was still unpaid. The said amount was entered in the inventory of his estate as conjugal property and passed to the heirs of Lahaba. Trial court concluded that the heirs are entitled to recover the said sum of P30,000 after deducting the expenses incurred by Lahaba for the survey and registration of said lands and for attorneys fees and taxes. Both parties appealed. Among the issues include: the court having no jurisdiction over the subject matter, the claim constitutes res judicata, and the action has prescribed. Issue: Was the lower court correct in deciding in favor of the heirs of Salinas? Yes.

Ruling: The amount of P30,000 which the heirs of Salinas were seeking to recover is not a claim against the estate of Lahaba, it is not an indebtedness but represents the price of trust property administered by him, of which he and his heirs failed and refused to account. The lower court acted correctly in taking jurisdiction of the case. The payment to the heirs of Salinas in the amount of P2,500 constitutes res judicata as to that amount only, but not as to the amount of P30,000 claimed in this action. As a general rule, a trust estate is exempt from the operation of the statute of limitations. A trustee, however, may acquire the trust estate by prescription provided there is repudiation of the trust and this fact is known to the cestui que trust. The repudiation must be clear, open and unequivocal. Prescription in order to be available as a defense, the trustee must prove that there was a direct repudiation of the trust and that the cestui que trust or beneficiary had knowledge thereof. Mere failure of the trustee to respond to repeated inquiries addressed to him by the cestui que trust is not enough. There was no open, clear and unequivocal repudiation of the trust by Lahaba. Neither was there any knowledge on the part of Salinas and his heirs of any such repudiation. On the contrary, there was concealment and misappropriation on the part of Lahaba of the property entrusted to his administration and care. None of the alleged errors was committed by the lower court. Judgment affirmed.