Case 1: G.R. No.

112872 April 19, 2001

THE INTESTATE ESTATE OF ALEXANDER T. TY, represented by the Administratrix, SYLVIA S. TY, petitioner, vs. COURT OF APPEALS, HON. ILDEFONSO E.GASCON, and ALEJANDRO B. TY, respondents.

Express trusts are those that are created by the direct and positive acts of the parties, by some writing or deed or will or by words evidencing an intention to create a trust. On the other hand, implied trusts are those which, without being expressed, are deducible from the nature of the transaction by operation of law as matters of equity, independently of the particular intention of the parties. In the cases at hand, private respondent contends that the pieces of property were transferred in the name of the deceased Alexander for the purpose of taking care of the property for him and his siblings. Such transfer having been effected without cause of consideration, a resulting trust was created. A resulting trust arises in favor of one who pays the purchase money of an estate and places the title in the name of another, because of the presumption that he who pays for a thing intends a beneficial interest therein for himself. The trust is said to result in law from the acts of the parties. Such a trust is implied in fact (Tolentino, Civil Code of the Philippines, Vol. 4, p. 678). If a trust was then created, it was an implied, not an express trust, which may be proven by oral evidence (Article 1457, Civil Code), and it matters not whether property is real or personal (Paras, Civil Code of the Philippines, Annotated, Vol. 4, p. 814). Dispositive: WHEREFORE, the petition for certiorari in G.R. No. 112872 is DISMISSED, having failed to show that grave abuse of discretion was committed in declaring that the regional trial court had jurisdiction over the case. The petition for review on certiorari in G.R. 114672 is DENIED, having found no reversible error was committed. Case 2 HEIRS OF EMILIO CANDELARIA, ETC., plaintiff-appellant, vs. LUISA ROMERO, ET AL., defendants-appellees.

G.R. No. 114672

April 19, 2001

SYLVIA S. TY, in her capacity as Administratrix of the Intestate Estate of Alexander T. Ty, petitioner, vs. COURT OF APPEALS and ALEJANDRO B. TY, respondents.

Doctrine: A resulting trust arises in favor of one who pays the purchase money of an estate and places the title in the name of another, because of the presumption that he who pays for a thing intends a beneficial interest therein for himself. The trust is said to result in law from the acts of the parties. Facts: Petitioner Sylvia S. Ty was married to Alexander T. Ty, son of private respondent Alejandro B. Ty, on January 11, 1981. Alexander died of leukemia on May 19, 1988 and was survived by his wife, petitioner Sylvia, and only child, Krizia Katrina. In the settlement of his estate, petitioner was appointed administratrix of her late husbands intestate estate. On November 4, 1992, petitioner filed a motion for leave to sell or mortgage properties(a parcel of land and shares of stock in different companies) of Alexander Ty in order to generate funds for the payment of deficiency estate taxes in the sum of P4,714,560.00. Private respondent Alejandro Ty then filed two complaints for the recovery of the properties mentioned. Private respondent claims that the subject properties are bought through his money even if said properties are placed in the name of Alexander Ty. Motions to dismiss were filed by petitioner. Claiming that An express trust between private respondent Alejandro and his deceased son Alexander. The motions to dismiss were denied. Petitioner then filed petitions for certiorari in the , which were also dismissed for lack of merit. Thus, the present petitions now before the Court. Petitioner contends that private respondent is attempting to enforce an unenforceable express trust over the disputed real property. Petitioner is in error when she contends that an express trust was created by private respondent when he transferred the property to his son. Issue/s: Was an express trust created? Held: No.

NATURE: appeal from an order dismissing plaintiff's complaint for reconveyance of with damages. The dismissal was ordered on a mere before answer was filed. DOCTRINE: where property is taken by a person under an agreement to hold it for, or convey it to another or the grantor, a resulting or implied trust arises in favor of the person for whose benefit the property was intended FACTS: in 1956, Emilio Candelaria filed in her own behalf and in representation of the other alleged heirs of Emilio Candelaria, alleges in substance that sometime prior to 1917 the latter and brother Lucas Candelaria bought each a lot in the Solokan Subdivision on the installment basis; that Lucas paid the first two installments corresponding to his lot, but faced with the inability of meeting the subsequent installments because of sickness which caused him to be bedridden, he sold his interest therein to his brother Emilio, who then reimbursed him the amount he had already paid, and thereafter continued payment of the remaining installments until the whole had been fully satisfied; "that although Lucas Candelaria had no more interest over the lot, the subsequent payments made by Emilio Candelaria until fully paid were made in the name of Lucas Candelaria, with the understanding that the necessary documents of transfer will be made later. In 1918, TCT was in the name of Lucas.

Complaint alleges that Lucas held the title to said lot merely in trust for Emilio and that this fact was acknowledged not only by him but also by the defendants (his heirs) on several occasions; that Lucas' possession of the lot was merely tolerated by Emilio and his heirs; that from the time Emilio bought the lot from his brother, Lucas had been collecting all its rents for his own use as financial aid to him as a brother in view of the fact that he was bedridden without any means of livelihood and with several children to support. Later, when Emilio was confined at the Culion Leper Colony up to his death on February 5, 1936, Lucas had been giving part of the rents to Fortunata Bautista, the second wife of Emilio, in accordance with the latter's wishes; that Lucas died in August, 1942, survived by the present defendants, who are his spouse Luisa Romero and several children; and that said defendants are still in possession of the lot, having refused to reconvey it to plaintiff despite repeated demands the defendants filed a motion to dismiss, alleging, among other things, that plaintiff's cause of action is unenforceable under the new Civil Code and that the action has already prescribed. And the court having upheld the motion, plaintiff took this appeal LC decision: held that an express and not an implied trust was created as may be gleaned from the facts alleged in the complaint, which is unenforceable without any writing, and that since of Title No. 9584 covering the land in question had been issued to Lucas Candelaria way-back in 1918 or 38 years before the filing of the complaint, the action has already prescribed ISSUE: WON there is an implied trust?

property in question was acquired by Lucas Candelaria under circumstances which show it was conveyed to him on the faith of his intention to hold it for, or convey it to the grantor, the plaintiff's predecessor in interest. Constructive or implied trusts may, of course, be barred by lapse of time. The rule in such trusts is that laches constitutes a bar to actions to enforce the trust, and repudiation is not required, unless there is a concealment of the facts giving rise to the trust. The beneficiary of a resulting trust may, therefore, without prejudice to his right to enforce the trust, prefer the trust to persist and demand no conveyance from the trustee. It being alleged in the complaint that Lucas held the title to the lot in question merely in trust for Emilio and that this fact was acknowledged not only by him but also by his heirs, herein defendants which allegation is hypothetically admitted we are not prepared to rule that plaintiff's action is already barred by lapse of time. On the contrary, we think the interest of justice would be better served if she and her alleged co-heirs were to be given an opportunity to be heard and allowed to present proof in support of their claim. Wherefore, the order of dismissal appealed from is hereby reversed and the case remanded to the court a quo for further proceedings. So ordered without costs. Case 3 Comilang vs Burcena Doctrine: bolded Facts:

HELD: YES RATIO: As held, in effect, by this Court in the case of Martinez vs. Grao (42 Phil., 35), where property is taken by a person under an agreement to hold it for, or convey it to another or the grantor, a resulting or implied trust arises in favor of the person for whose benefit the property was intended. This rule, which has been incorporated in the new Civil Code in Art. 1453 thereof, is founded upon equity. It is also the rule there that an implied trust arises where a person purchases land with his own money and takes a conveyance thereof in the name of another. In such a case, the property is held on a resulting trust in favor of the one furnishing the consideration for the transfer, unless a different intention or understanding appears. The trust which results under such circumstances does not arise from contract or agreement of the parties, but from the facts and circumstances, that is to say, it results because of equity and arises by implication or operation of law. In the present case, the complaint expressly alleges that "although Lucas Candelaria had no more interest over the lot, the subsequent payments made by Emilio Candelaria until fully paid were made in the name of Lucas Candelaria, with the understanding that the necessary documents of transfer will be made later, the reason that the transaction being brother to brother." From this allegation, it is apparent that Emilio Candelaria who furnished the consideration intended to obtain a beneficial interest in the property in question. Having supplied the purchase money, it may naturally be presumed that he intended the purchase for his own benefit. Indeed, it is evident from the above-quoted allegation in the complaint that the

On April 29, 1985, Francisco Burcena and Mariano Burcena (respondents), together with their mother, Dominga Reclusado Vda. de Burcena (Dominga), filed a complaint for annulment of document with damages against Salvador Comilang (petitioner). The complaint alleges that respondents are the owners of a 918parcel of land in Ilocos Sur and the house thereon; respondents acquired the subject property through their earnings while working abroad; the subject property was declared for taxation purposes in Domingas name as administrator thereof; on or about March 12, 1984, petitioner caused the execution of a Deed of Donation2 over said property by taking advantage of Domingas blindness, and physical infirmity; the said Deed of Donation is null and void because,inter alia, dominga had no right to donate the same since she is not its owner but a mere trustee;petitioner is in possession of the subject property, depriving respondents of its ownership and its fruits.

petitioner contends,in their reply, that the Deed of Donation was freely and voluntarily executed by Dominga. They further avvered that Dominga,who was a merchant, financed out of her own money the construction of the house and subsequent improvements thereof. Lastly, they avvered that, granting that respondents had been sending money to Dominga, said money already belonged to her when she bought the land and the house

Dominga died during the pendecy of the case RTC & CA: ruling in favor of respondents. They held that the money used to pay belonged to respondent and the property was only named under Dominga who had no authority to donate.

Respondents have shown that the two elements are present in the instant case.Dominga was merely a trustee of the respondents in relation to the subject property. Therefore, Dominga could not have validly donated the subject property to petitioner, as expressly provided in Article 736 of the Civil Code, thus:

Petitioner assails the CAs application of the principle of implied trust to nullify the Deed of Donation executed in his favor. Petitioner further argues that Margaritas statement on the witness stand that Dominga told Margarita that the respondents sent her money to buy the subject property, should not have been given weight or credence by the RTC and the CA because it is hearsay and has no probative value.

Art. 736. Guardians and trustees cannot donate the property entrusted to them.

Issue 1. 2. whether or not there was implied trust Held Yes Whether or not margarita;s statement should be given credence Held Yes

2. Anent Margaritas testimony that Dominga told her that the respondents sent her (Dominga) money to buy the subject property, it cannot be categorized as hearsay evidence. Margaritas testimony was not presented to prove the truth thereof, but only to establish the fact that Dominga narrated to Margarita the source of the funds used in the purchase of the subject property

Besides, the testimony of Margarita is not the main basis for the RTCs decision. In fact, her testimony is not indispensable. It merely serves to corroborate the testimonies of the respondents on the source of the funds used in purchasing the subject property. The testimonies of all three witnesses for the plaintiffs were found to be convincing and credible by the RTC. Case 4 Sime Darby vs. Jesus Mendoza DOCTRINE: a trust arises in favor of one who pays the purchase price of a property in the name of another, because of the presumption that he who pays for a thing intends a beneficial interest for himself. FACTS: Petitioner Pilipinas, Inc. (Sime Darby) employed Jesus B. Mendoza (Mendoza) as sales manager to handle sales, marketing, and distribution of the company's tires and rubber products. On 3 July 1987, Sime Darby bought a Class "A" club sharein Alabang (ACC) from Margarita de Araneta as evidenced by a Deed of Absolute Sale. The share, however, was placed under the name of Mendoza in trust for Sime Darby since the By-Laws of ACC state that only natural persons may own a club share. As part of the arrangement, Mendoza endorsed the Club Share Certificatein blank and executed a , also in blank, and handed over the documents to Sime Darby. From the time of purchase in 1987, Sime Darby paid for the monthly dues and other assessments on the club share. When Mendoza retired in April 1995, Sime Darby fully paid Mendoza his separation pay amounting to more than P3,000,000. Nine years later, or sometime in July 2004, Sime Darby found an interested buyer of the club share for P1,101,363.64. Before the sale could push through, the broker required Sime Darby to secure an authorization to sell from Mendoza since the club share was still registered in Mendozas name. However, Mendoza refused to sign the required authority to sell or special power of attorney unless Sime Darby paid him the amount of P300,000, claiming that this represented his unpaid separation benefits. As a result, the sale did not push through and Sime Darby was compelled to return the payment to the prospective buyer.

Ratio:

1. First of all, petitioner contended that the issue of the existence of trust wasnt brought up with the CA. in reply, the SCsaid , an appellate court is clothed with ample authority to review rulings even if they are not assigned as errors in the appeal in matters not assigned as errors on appeal but are evidently plain or clerical errors within contemplation of law.

In answerin the issue, the court cited Art. 1448 There is an implied trust when property is sold, and the legal estate is granted to one party but the price is paid by another for the purpose of having the beneficial interest of the property. The former is the trustee, while the latter is the beneficiary. However, if the person to whom the title is conveyed is a child, legitimate or illegitimate, of the one paying the price of the sale, no trust is implied by law, it being disputably presumed that there is a gift in favor of the child. (Emphasis supplied)

The trust created under the first sentence of Article 1448 is sometimes referred to as a purchase money resulting trust, the elements of which are: (a) an actual payment of money, property or services, or an equivalent, constituting valuable consideration; and (b) such consideration must be furnished by the alleged beneficiary of a resulting trust.

Sime Darby filed a complaint for damages with writ of preliminary injunction against Mendoza with the Regional Trial Court (RTC) of Makati City, Branch 132. PETITIONERS CLAIM: Sime Darby claimed that it was the practice of the company to extend to its senior managers and executives the privilege of using and enjoying the facilities of various club memberships, i.e. and Country Club, Quezon City Sports Club, Makati Sports Club, Wack Wack , and Baguio Golf and Country Club. Sime Darby added that during Mendozas employment with the company until his retirement in April 1995, Sime Darby regularly paid for the monthly dues and other assessments on the ACC Class "A" club share. Further, Sime Darby alleged that Mendoza sent a letter dated 9 August 2004 to ACC and requested all billings effective September 2004 be sent to his personal address. Despite having retired from Sime Darby for less than 10 years and long after the of Mendoza with the company has been severed, Mendoza resumed using the facilities and privileges of ACC, to the damage and prejudice of Sime Darby. Thus, Sime Darby prayed that a restraining order be issued, pending the hearing on the issuance of a writ of preliminary injunction, enjoining Mendoza from availing of the clubs facilities and privileges as if he is the owner of the club share. RESPONDENTS CLAIM: Mendoza filed an Answer alleging ownership of the club share. Mendoza stated that Sime Darby purchased the Class "A" club share and placed it under his name as part of his employee benefits and bonus for past exemplary service. Mendoza admitted endorsing in blank the stock certificate covering the club share and signing a blank assignment of rights only for the purpose of securing Sime Darbys right of first refusal in case he decides to sell the club share. RTC: Ruled in favor of Sime Darby; CA: reversed the decision of the Trial Court ISSUE: Whether or not Mendoza is the owner of the club share HELD: NO. Petitioner Sime Darby has sufficiently established its right over the subject club share. Sime Darby presented evidence that it acquired the Class "A" club share of ACC in 1987 through a Deed of Sale. Being a corporation which is expressly disallowed by ACCs By-Laws to acquire and register the club share under its name, Sime Darby had the share registered under the name of respondent Mendoza, Sime Darbys former , under a trust arrangement. Even during the trial, at Mendozas cross-examination, Mendoza identified his signature over the printed words "name of assignee" as his own. Further, Mendoza admitted signing the club share certificate and the assignment of rights, both in blank, and turning it over to Sime Darby. Clearly, these circumstances show that there existed a trust relationship between the parties. While the share was bought by Sime Darby and placed under the name of Mendoza, his title is only limited to the usufruct, or the use and enjoyment of the clubs facilities and privileges while employed with the company. In Thomson v. Court of Appeals, we held that a trust arises in favor of one who pays the purchase price of a property in the name of another, because of the presumption that he who pays for a thing intends a beneficial interest for himself. While Sime Darby paid for the purchase price of the club share, Mendoza was given the legal title. Thus, a resulting trust is presumed as a matter of law. The burden then shifts to the transferee to show otherwise. It can be gathered then that Sime Darby did not intend to give up its beneficial interest and right over the share. The

company merely wanted Mendoza to hold the share in trust since Sime Darby, as a corporation, cannot register a club share in its own name under the rules of the ACC.

Case5 NAKPIL VS. IAC AND VALDES AND CAVAL REALTY CORPORATION DOCTRINE: An agreement between the trustee and the trustor that failure of the beneficiary to reimburse the payment made by the trustee on his behalf will result in the automatic conveyance of the property to the trustee is tantamount to pactum commissorium, and is null and void. FACTS: [Fun Facts, not important to the case] Pinggoy Nakpil (Petitioners Husband) and Charlie Valdes (Respondent) were best friends since their high school in La Salle and later, at the Philippine Law School. Their friendship led to Charlie being Pinggoys lawyer, accountant, auditor, and business and financial consultant. Charlie became the godfather of Pinggoys youngest child while Pinggoy became the godfather of Charlies second son. The subject of the case is the property known as Pulong Maulap located in Moran St., Baguio City, named by Petitioner Imelda Nakpil (Pinggoys wife). The dispute regarding the true owner of the property arose in intestate proceedings of Pinggoy, after he died due to drowning. Respondent acted as the legal counsel of Petitioner, who became the administratix of Pinggoys estate. It was shown that Respondent did not include Pulong Maulap as among the properties included in the estate of Pinggoy. Moreso, Charlie assigned the property to Caval Realty Corporation (CRC), which he is 99.7% owned by him, for 15,000 shares. The TCT in Respondents name was thus, cancelled, and a new TCT was issued in favor of CRC Petitioner instituted a case for reconveyance and damages for breach of trust against Charlie Valdes and the Caval Realty Corporation. Petitioner alleges that her husband, Pinggoy, requested Valdes to purchase Pulong Maulap and hold title thereto in trust for Pinggoy; and that Respondent concealed the trust agreement Evidence presented in the trial shows that the downpayment for the property was made by Valdes, and that Valdes also assumed the Vendors Mortgage Obligation with the PNB. Thus, the Deed of Sale and TCT was issued in his name. However, even before the Deed of Sale or TCT was even issued, the Nakpils have already moved in to Pulong Maulap In order to facilitate the servicing of the mortgage obligation, the loan was transferred to First United Bank (FUB) where Pinggoy was Vice-President. Valdes borrowed money from FUB with which he paid PNB, and mortgaged Pulong Maulap. In a letter written by Respondent, it was shown that he remitted the FUB checks to Pinggoy. In another letter, it was stated that although both of these loans, while in my

(respondents) name, were obtained by Pinggoy for his person. It also stated that he will pay the total loan and that it was understood that Pinggoys family wil l continue to occupy Pulong Maulap for 5 years. Lastly, it showed that Pinggoys family was responsible for the maintenance expenses while the real estate taxes were shouldered by Respondent. Meanwhile, Petitioner, after receiving an offer of 2M from Pablo Cuneta (Pasay City Mayor) for Pulong Maulap, wrote a letter to Respondent demanding a reconveyance so she could put into effect the sale and reimburse the latter from the proceeds thereof. Respondent told petitioner that he could not execute the deed of conveyance because he was the true owner of Pulong Maulap and he had no intention of selling it. Prompting Petitioner to file the case. The RTC of Baguio held that there was a constructive trust. The RTC based the creation of an implied trust on the letters presented showing that the downpayment although made by Valdes, was considered by him as a loan to Nakpil. Also, although the loans were in his name also, they were obtained by Pinggoy for his person. RTC held that the letters confirmed a pre-existing express trust between Pinggoy and Respondent where Respondent is trustee, and Pinggoy was trustor and beneficiary. Respondents repudiation of the trust, when he did not include the property in the estate of Pinggoy and claimed that it was his, converted it a constructive implied trust. In addition, if the letters (in arguendo) were not sufficient to prove an express trust, an implied trust under Art. 1450 is applicable. However, the RTC dismissed the petition because the letters also proved that petitioner waived her right over Pulong Maulap by acknowledging that they would only stay for 5 years under the option that they may purchase back the property upon payment of the FUB loans that Respondent paid. In addition, a letter petitioner made was also presented wherein she expressly recognized that she may only reconvey the property upon reimbursement of the loans. Unless Petitioner could prove that she had fulfilled with that stipulation, she is stopped to assert her right over the property. CA reversed stating there was no trust relationship. Petitioner appealed to the SC, arguing that the CA erred in not recognizing a trust relationship and that the RTC erred in holding that she had made a waiver of her right to the property because it would constitute a pactum commisorium (agreement that upon the failure of payment of loan, the mortgaged/pledged property is immediately transferred to the creditor) which is expressly declared null and void. Respondent argues that there is no trust relationship and that Art. 1450 does not apply because such provision only applies in cases where the property sold is paid by the lender for the benefit of the borrower or buyer of the property; which is not present in this case because Respondent bought the property with his own funds.

HELD: YES (TO BOTH) Article 1450 presupposes a situation where a person, using his own funds, purchases a certain piece of land on behalf of another who, in the meantime, may not have sufficient funds to purchase the land. Such a situation is present in this case as evidenced by the letters of Respondent. As it was shown that although he made the payments, it was through loans that although in his name, were obtained by Pinggoy for his person He also remitted the payment of the real estate taxes to Pinggoy, stating in the letter that the payment being tendered was on behalf of the Nakpils However, RTC was correct that petitioner cannot redeem the conveyance of the property yet, as she must first reimburse the loans paid for by Valdes. The RTC, however, was incorrect in holding that petitioner is estopped from reconveying the property based on the waiver of her rights due to her non-payment of the loans. An agreement that would automatically convey the property to Respondent upon non-payment of the loan is tantamount to pactum commissorium and is expressly stated in the Civil Code (Article 2088) to be null and void. Article 2088 provides: The creditor cannot appropriate the things given by way of pledge or mortgage, or dispose of them. Any stipulation to the contrary is null and void. All the elements of a pactim commissorium are present: (1) creditor-debtor relationship, (2) the property was used as security for the loan, (3) automatic appropriation by creditor (respondent0 of the property in case of default of debtor (Pinggoy)

DISPOSITIVE: Thus, Petitioner may redeem the property after reimbursing respondent of the sum advanced by him.

Case 6 Case 7 CASE NO. 8 G.R. No. L-1717. April 17, 1950.

JUANA MANLINCON and JACINTO (alias Marcelo) DE GUZMAN, Plaintiffs-Appellees, vs. MAGNO DE VERA and CONSTANCIA URMAZA, Defendants-Appellants. Doctrine: A purchaser who obtained a certificate of title in his name with his admitted knowledge of the facts about the ownership of the property is considered as a trustee, not in its technical sense, but for a want of a better term. Facts: Domingo Manlincon and Maxima Arenas (second wife) own a piece of land in Pangasinan, as part of their conjugal property. The land is a fish pond, and has an area of 1.5 hectares. On 1930, Domingo died. Two years after, the land was sold to the herein defendants, by Maxima (the surviving wife). The Deed of Sale was also signed by Moises and Francisca, the children of Domingo from the first

ISSUE: W/N ARTICLE 1450 APPLIES AND IF PETITIONER MAY STILL RECONVEY THE PROPERTY

marriage. A torrens certificate of title was issued in the name of the spouses defendants. The plaintiff herein (Juana) was the only surviving child of Domingo and Maxima. She was still a minor at the time of the sale. The plaintiff filed an action for reconveyance. The plaintiff reasoned that the sale was tainted with fraud, and that the sale defendant, Magno de Vera had an amorous affair with Maxima and that the documents of title was obtained by the defendant through deceit. The court (CFI) rejected the theory of the plaintiff and held that the sale is valid as far as the share of Maxima is concerned. But the court, in disposing the case, ordered the defendants to execute a deed of conveyance in favor of the plaintiff, Juana, as to the onesixth portion of the land, plus one-sixth portion of all the products of the land or fishpond. Issue: Whether the judgment of the court (CFI) is correct. Should a portion of the land be returned to the plaintiff? Held: Yes, the judgment of the trial court is correct, a reconveyance must be made as to 1/6 portion of the land. The defendants happened to be the owner of the adjoining fishpond. They knew that the fishpond by Domingo and Maxima, who had Juana as their only child. They also knew that upon the death of Domingo, Juana succeeded to the right of her father in the ownership of the fishpond. The resulting situation was a sort of a special trust in which Juana was the beneficiary and the defendants, the trustees. Dispositive: The appealed judgment is affirmed.

thereon. They have possessed the land as owners from 1923 up to this time(1985) or for more than half a century. The respondents(descendants of Canutas siblings) claim that Canuta was one of the five children of Domingo Somblingo, the alleged original owner of the lot when it was not yet registered. They filed an action in 1964 and amended it in 1968, it was stated in their claim that the Sinaons were trustees of the lot and that the heirs of Domingo's four children are entitled to a 4/5 share thereof. That theory was sustained by the trial court and the Appellate Court. The trial court ordered the Sinaons to convey 4/5 of Lot No. 4781 to respondents Sorogon, et al. It decreed partition of the lot in five equal parts. The Sinaons appealed to the Supreme Court. The respondents did not file any brief. Issue/s: Whether an action for reconveyance of a registered fivehectare land, based on implied trust, would lie after the supposed trustees had held the land for more than forty years? Held: No The Sinaons had appeared to be the registered owners of the lot for more than forty years and had possessed it during that period, their title had become indefeasible and their possession could not be disturbed. Any pretension as to the existence of an implied trust should not be countenanced. The trustors who created the alleged trust, died a long time ago. An attempt to prove the trust was made by unreliable oral evidence. The title and possession of the Sinaons cannot be defeated by oral evidence which can be easily fabricated and contradicted. The contradictory oral evidence leaves the court sometimes bothered and bewildered. There was no express trust in this case. Express trusts concerning real property cannot be proven by parol evidence (Art. 1443, Civil Code). An implied trust "cannot be established, contrary to the recitals of a Torrens title, upon vague and inconclusive proof" (Suarez vs. Tirambulo, 59 Phil. 303; Salao vs. Salao, L-26699, March 16,1976, 70 SCRA 65, 83). Even assuming that there was an implied trust, plaintiffs' action was clearly barred by prescription (Salao vs. Salao, supra, p. 84). Doctrine: WHEREFORE, the judgment of the Court of Appeals is reversed and the complaint is dismissed. The receivership is terminated. The receiver is directed to wind up his accounts. No costs.

Case 9: PATRICIO SINAON and MARIA, FRANCISCA and JOSE, all surnamed SINAON, petitioners, vs. ANDRES SOROGON, ANASTACIA PARREO, SOLEDAD PARREO, ANA PARREO, MARCELINA, CLARITA, RUFINO and MANUEL, all surnamed ARELLANO, SIMPLICIO SOMBLINGO and BRIGIDA SOMBLINGO and COURT OF APPEALS, respondents.

Doctrine: An implied trust "cannot be established, contrary to the recitals of a Torrens title, upon vague and inconclusive proof" Facts: The subject parcel of land in this case is Lot No. 4781 of the Sta. Barbara, Iloilo cadastre with an area of 5.5 hectares, which was adjudicated in favor of Canuta Soblingo(A widow). A certificate of title was issued in her favor for the said land. In 1923 Canuta sold the lot to the spouses Patricio Sinaon and Julia Sualibio for P2,000. TCT No. 2542 was issued to the Sinaon spouses. It is still existing and uncancelled up to this time(1985), Julia was the granddaughter of Canuta. The lot was declared for tax purposes in Sinaon's name. The Sinaon spouses and their children paid the realty taxes due

Case 10 Diaz vs gorricho DOCTRINE: In constructive trusts, there is neither a promise nor fiduciary relation; the so called trusteed does not recognize any trust and has no intent to hold for the beneficiary; therefore, the latter is not justified in delaying action to recover his property. He may then be estopped by his own laches Facts

the land disputed in the case was originally owned by the spouses Francisco Diaz and Maria Sevilla. francisco then died. Now PR Carmen Gorricho filed a case against Maria and so a writ of attachment was issued by the the court including the land disputed in this case. When Maria faild to redeem the land, a final deed was issued in favor of Carmen by the sheriff for the whole land, however it is worth noting that Maria was co-owners of the land with the heirs of his husband.hence, Carmen only has the right to half of the land and not whole. When Maria died, the heirs instituted a case for an action for reconveyance against Carmen Gorricho for holding in trust half of the land on their behalf. PR Gorricho on the other hand defended that the action had already prescribed.

must be adequately pleaded by the plaintiff in a suit to declare a trust where the delay is apparent on the face of his pleading

In constructive trusts, there is neither a promise nor fiduciary relation; the so called trusteed does not recognize any trust and has no intent to hold for the beneficiary; therefore, the latter is not justified in delaying action to recover his property. He may then be estopped by his own laches. <---- DOCTRINE

TRIAL COURT: There was indeed a constructive trust but it was already barred by laches and prescription.

To sum up, the SC ruled that the case should be dismissed because the appellants cause of action to attack the sheriff's deed and cancel the tct issued to the appellee Carmen accrued from the year of issuance and recording in 1937 and appellants have allowed 15 years to elapse before taking remedial action. To note that the longest period of extinctive prescription is only 10 years. Judgment appealed from is affirmed.

ISSUE WON the heirs (their children) have a right of action against PR? YES. WON there was a trust created between them? YES WON the action has already prescribed or had been barred by laches? YES. Case 11: G.R. No. L-44546 January 29, 1988 RUSTICO ADILLE, petitioner, vs. THE HONORABLE COURT OF APPEALS, EMETERIA ASEJO, TEODORICA ASEJO, DOMINGO ASEJO, JOSEFA ASEJO and SANTIAGO ASEJO, respondents.

HELD: The court emphasized that yes, there was an implied trust created however, the plaintiffs are in error when they stipulated in their appeal that an implied trust cannot prescribe or be barred by laches. Here, the court discussed the distinctions of an express trust and constructive trust. Express trust is Created by the intention of the parties while a constructive trust is created by operation of law it not being trusts in their technical sense. Also, in constructive trusts, the rule is that laches constitutes a bar to actions to enforce the trust,a nd repudiation is not required unless there is concealment of the facts giving rise to the trust. Doctrine: 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. Facts: The subject parcel of land originally belong to Felisa Alzul as her own private property. she married twice in her lifetime; the first, with one Bernabe Adille, with whom she had as an only child, herein petitioner Rustico Adille; in her second marriage with one Procopio Asejo, her children are herein private respondents. Now, sometime in 1939, said Felisa sold the property in pacto de retro to certain 3rd persons, period of repurchase being 3 years, but she died in 1942 without being able to redeem and after her death. During the redemption period petitioner was able to redeem the said property. He executed a deed of extra-judicial partition representing himself to be the only heir and child of his mother Felisa with the consequence that he was able to secure title in his name alone. After some efforts of compromise had failed, his half-brothers and sisters, herein respondents, filed present case for partition with accounting on the position that he was only a trustee on an implied trust when he redeemed the subject property. The trial court ruled that petitioner was the absolute owner of the land, not a trustee.

SEC581:( did not mentioned from what law or code) In case of Constructive or Resulting Trust. Laches constitutes a defense to a suit to declare and enforce a constructive trust for the purpose of the rule, repudiation of the constructive trust is not required, and time runs from the moment that the law creates the trust, which is the time when the cause of action arises. But laches does not exist while the trusted, fraudulently and successfully conceals the facts giving rise to the trust, although the concealment

The respondent Court of appeals reversed the trial Court, and ruled for the private respondents. Hence, this petition. Essentially, it is the petitioner's contention that the property subject of dispute devolved upon him upon the failure of his co-heirs to join him in its redemption within the period required by law. He relies on the provisions of Article 1515 of the old Civil Article 1613 of the present Code, giving the vendee a retro the right to demand redemption of the entire property. Issue/s: Is the petitioner a trustee resulting from an implied trust? Held: Yes It was decided that the co-ownership was not terminated due to the act of the petitioner redeeming the said property for himself. Neither did the co-ownersip terminate due to the registration of the land in favor of the petitioner. The petitioner must then be said to be a trustee of the property on behalf of the private respondents. The Civil Code states: ART. 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. Fraud attended the registration of the property. The petitioner's pretension that he was the sole heir to the land in the affidavit of extrajudicial settlement he executed preliminary to the registration thereof betrays a clear effort on his part to defraud his brothers and sisters and to exercise sole dominion over the property. The aforequoted provision therefore applies. Dispositive: WHEREFORE, there being no reversible error committed by the respondent Court of Appeals, the petition is DENIED. The Decision sought to be reviewed is hereby AFFIRMED in toto. No pronouncement as to costs.

on February 21, 1975, Security Pacific National Bank (SEPAC) of Los Angeles which had an agency arrangement with Philippine National Bank (PNB), transmitted a cable message to the PNB to pay the amount of US$14,000 to Mata by crediting the latter's account with the Insular Bank of Asia and America (IBAA), per order of Star Kist. Upon receipt of this cabled message on February 24, 1975, PNB noticed an error and sent a service message to SEPAC Bank. The latter replied with instructions that the amount of US$14,000 should only be for US$1,400.

On the basis of the cable message dated February 24, 1975 Cashier's Check in the amount of US$1,400 (P9,772.95) representing reimbursement from Star Kist, was issued by the Star Kist for the account of Mata through the Insular Bank of Asia and America (IBAA).

fourteen days after or on March 11, 1975, PNB mistakenly effected another payment through Cashier's Check in the amount of US$14,000 (P97,878.60) purporting to be another transmittal of reimbursement from Star Kist

Six years later, or more specifically, on May 13, 1981, PNB requested Mata for refund of US$14,000 after it discovered its error in effecting the second payment.

On February 4, 1982 (7 yrs after the mistake in payment), PNB filed a civil case for refund of US$14,000 against Mata arguing that based on a constructive trust under Article 1456 of the Civil Code

Case 12. PNB vs CA and B.P. MATA AND CO. Inc.

RTC and CA rendered judgment dismissing the complaint ruling that the instant case falls squarely under Article 2154 on solutio indebiti (the person who makes the payment is the one who commits the mistake vis-a-vis the recipient who is unaware of such a mistake ) Consequently, recipient is duty bound to return the amount paid by mistake. However the case cant prosper because according to Article 1145, paragraph 2 of the Civil Code an action based on a quasi contract prescribe in 6yrs and the case was filed 7 years after the cause of action.

Facts:

Issue: Whether or not there is a contrructive trust (10 yrs presrcriptive period) or a solutio indebiti (6 yrs) Held: The court did not answer but ruled that the action is barred by laches. What the court did was to only compare the two.

Private Respondent B.P. Mata & Co. Inc. (Mata), is a private corporation engaged in providing goods and services to shipping companies. Since 1966, it has acted as a manning or crewing agent for several foreign firms, one of which is Star Kist Foods, Inc., USA (Star Kist).

According to their agreement, Mata makes advances for the crew's medical expenses, National Seaman's Board fees, Seaman's Welfare fund, and standby fees and for the crew's basic personal needs. Subsequently, Mata sends monthly billings to its foreign principal Star Kist, which in turn reimburses Mata by sending a telegraphic transfer through banks for crediting the Matas account.

Ratio: Article 1456(constructive trust) of the Civil Code provides: 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.

On the other hand(solutio indebiti), Article 2154 states: If something is received when there is no right to demand it, and it was unduly delivered through mistake, the obligation to return it arises.

There is a presumption that there was a mistake in the payment "if something which had never been due or had already been paid was delivered; but he from whom the return is claimed may prove that the delivery was made out of liberality or for any other just cause." 18 In the case at bar, after PNB already paid, PNB effected another payment through Cashier's Check No. 270271 in the amount of US$14,000, this time purporting to be another transmittal of reimbursement from Star Kist, private respondent's foreign principal.

(summary of trust and its kind/need not read anymore) trusts are either express or implied. While express trusts are created by the intention of the trustor or of the parties, implied trusts come into being by operation of law. 6 Implied trusts are those which, without being expressed, are deducible from the nature of the transaction as matters of intent or which are superinduced on the transaction by operation of law as matters of equity, independently of the particular intention of the parties. 7 In turn, implied trusts are subdivided into resulting and constructive trusts. 8 A resulting trust is a trust raised by implication of law and presumed always to have been contemplated by the parties, the intention of which is found in the nature of the transaction.On the other hand, a constructive trust is one not created by words either expressly or impliedly, but by construction of equity in order to satisfy the demands of justice. An example of a constructive trust is Article 1456 quoted above. A deeper analysis of Article 1456 reveals that it is not a trust in the technical sense 12 for in a typical trust, confidence is reposed in one person who is named a trustee . in a constructive trust, there is neither a promise nor any fiduciary relation to speak of and the so-called trustee neither accepts any trust nor intends holding the property for the beneficiary

Anent trust,under American law, a court of equity does not consider a constructive trustee for all purposes as though he were in reality a trustee; although it will force him to return the property, it will not impose upon him the numerous fiduciary obligations ordinarily demanded from a trustee of an express trust

Comparison of trust and quasi contract a constructive "trust" is as much a misnomer as a "quasicontract," so far removed are they from trusts and contracts proper, respectively. In the case of a constructive trust, as in the case of quasi-contract, a relationship is "forced" by operation of law upon the parties, not because of any intention on their part but in order to prevent unjust enrichment, thus giving rise to certain obligations not within the contemplation of the parties. Also, both of them are based on the principle of no one shall enrich himself at the expense of another

In the case at bar, Mata, in receiving the US$14,000, had no intent of holding the same for a supposed beneficiary ,PNB. But under Article 1456, the law construes a trust, namely a constructive trust, for the benefit of the person from whom the property comes, in this case PNB, for reasons of justice and equity.

the court agreed with petitioner's stand that under Article 1456, the law does not make any distinction since mutual mistake is a possibility on either side on the side of either the grantor or the grantee.Thus, it was error for the CA to conclude that in a constructive trust, only the person obtaining the property commits a mistake. This is because it is also possible that a grantor, like PNB in the case at hand, may commit the mistake.

History of trust and quasi contract even as Article 2142 of the Civil Code defines a quasi-contract, the succeeding article provides that: "The provisions for quasi-contracts in this Chapter do not exclude other quasi-contracts which may come within the purview of the preceding article."

Laches

Indubitably, the Civil Code does not confine itself exclusively to the quasi-contracts enumerated from Articles 2144 to 2175 but is open to the possibility that, absent a pre-existing relationship, there being neither crime nor quasi-delict, a quasi-contractual relation may be forced upon the parties to avoid a case of unjust enrichment.

petitioner's claim cannot prosper since it is already barred by laches. It is a well-settled rule now that an action to enforce an implied trust, whether resulting or constructive, may be barred not only by prescription but also by laches. While prescription is concerned with the fact of delay, laches deals with the effect of unreasonable delay.

Undoubtedly, the instant case fulfills the indispensable requisites of solutio indebiti as defined in Article 2154 that something (in this case money) has been received when there was no right to demand it and (2) the same was unduly delivered through mistake.

It is amazing that it took petitioner almost seven years before it discovered that it had erroneously paid private respondent. Petitioner would attribute its mistake to the heavy volume of international transactions handled by the Cable and Remittance Division of the International Department of PNB. Such specious

reasoning is not persuasive. It is unbelievable for a bank, and a government bank at that, which regularly publishes its balanced financial statements annually or more frequently, by the quarter, to notice its error only seven years later. As a universal bank with worldwide operations, PNB cannot afford to commit such costly mistakes. Moreover, as between parties where negligence is imputable to one and not to the other, the former must perforce bear the consequences of its neglect. Hence, petitioner should bear the cost of its own negligence.

The time of filing has been prescribed. Under Article 1144 of the Civil Code on Prescription based on written contracts, the filing of action for reconveyance is within 10 years from the time the condition in the Deed of Donation was violated. The petitioner herein filed only 24 years in the first action and 43 years in the second filing of the 2nd action.

The action for reconveyance on the alleged excess of 33, 607 square meter mistakenly included in the title was also prescribed Article 1456 of the Civil Code states, 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 benefits of the person from whom the property comes, if within 10 years such action for reconveyance has not been executed.

Dispositive: Ca decision affirmed Case 13 Vda. De Delgado vs. Court of Appeals DOCTRINE: Under Article 1144 of the Civil Code on Prescription based on written contracts, the filing of action for reconveyance is within 10 years from the time the condition in the Deed of Donation was violated. FACTS: Carlos Delgado was the absolute owner of a parcel of land with an area of 692,549 square meter situated in the Municipality of Catarman Samar. Carlos Delgado granted and conveyed by way of donation with quitclaim all rights, title, interest claim and demand over a portion of land with an area of 165,000 square meter in favor of the Commonwealth of the Philippines. The acceptance was then made to President Quezon in his capacity as Commander-in-Chief. The Deed of Donation was executed with a condition that the said land will be used for the formation of the National Defense of the Philippines. The said parcel of land then covered by the Torrens System of the Philippines and was registered in the name of Commonwealth of the Philippines for a period of 40 years. The land was registered under TCT 0-2539-160 in favor of annotation. Upon declaration of independence, the Commonwealth was replaced by Republic of the Philippines which took over the subject land and turned over to Civil Aeronautics Administration, later named Bureau of Air Transportation Office. The said agency utilizes the said land a domestic airport. Jose Delgado filed a petition for reconveyance for a violation of the condition. The RTC ruled in favor of the plaintiff Delgado. But the CA reversed the said decision because of prescription. The petitioner filed only before 24 years o discovery which the law only requires 10 years of filing. ISSUE: Whether or not the petitioners action for reconveyance is already barred by prescription. HELD: YES. the Commonwealth however without any Case 14 Case 15 Case 16

CASE NO. 17

G.R. No. 133047.

August 17, 1999

HEIRS OF LORENZO YAP, namely SALLY SUN YAP, MARGARET YAP-UY and MANUEL YAP, petitioners, vs. THE HONORABLE , RAMON YAP and BENJAMIN YAP, respondents. Doctrine: An implied trust in real property over parol evidence cannot be established upon vague and inconclusive proof. The trust or a provision in the terms of a trust would be invalid if the enforcement of the trust or provision is against the law even though its performance does not involve commission of a criminal or tortious act. Facts: Lorenzo, Ramon, and Benjamin (all Yap) were brothers. In 1966, Ramon purchased a lot in Manila from the spouses Nery and registered the lot in his name. In 1967, Ramon constructed therein a two-storey, 3-door apartment building for the use of Yap family. One-fifth (1/5) of the cost was defrayed by Ramon, and the rest was shouldered by Chua Mia, the mother of the three brothers. Ramon paid the taxes pertaining to the land, while the building was declared under the name of Lorenzo in respect to the wishes of the old woman (mother). On 1970, Lorenzo Yap died. The heirs of Yap (petitioners) left Lucena to reside in Manila permanently. Ramon allowed them to use one unit of the apartment. On March 1992, Ramon sold the land and his share in the apartment to Benjamin. On June 1992, the petitioners demanded that that the respondents execute the proper deed necessary to transfer the property to them. They asserted that it was Lorenzo who purchased the lot from the

spouses Nery, and because he was Chinese at that time, he requested his brother Ramon to allow them to use his name for registration and tax purposes. It was agreed that upon Lorenzos naturalization, the registration shall be transferred to his name, and should he die before the transfer, the registration shall be transferred to his heirs upon their naturalization. The petitioners contended that it was also Lorenzo who caused the construction of the apartment. The petitioners presented the testimony of Sally Yap, a co-petitioner, to support their claims. The trial court found for the respondents and adjudged Benjamin to be the lawful owner of the disputed property. CA affirmed the decision of the trial court. Issue: (1) Whether the evidence presented warrants the existence of an implied or express trust in favor of them as heirs of Lorenzo. (2) Should a trust agreement be proven to exist, whether it should be enforced between the parties. Held: (1) No, the evidence presented by the petitioners is found to be utterly wanting. Express trust over immovable property may not be established by parol evidence. And even implied trust in real property by parol evidence, the proof should be as fully convincing as if the acts giving rise to the trust obligation are proven by authentic evidence. An implied trust cannot be established upon vague and inconclusive proof. The witness, Sally Yap admitted that the business establishment of Lorenzo was razed by fire in 1964. It somehow places a doubt on the claim that Lorenzo had the means to purchase the subject lot two years later. On the other hand, Ramon, being an accountant, had the apparent means to buy the property himself. (2) No, a use of a juridical relation a trust, whether express or implied shall not be permitted to perpetrate fraud, or tolerate bad faith to subvert the law directly or indirectly. The constitution prohibits the transfer of agricultural land to individuals not qualified (foreign nationals) to acquire or hold lands in the Philippines. The trust or a provision in the terms of a trust would be invalid if the enforcement of the trust or provision is against the law even though its performance does not involve commission of a criminal or tortious act. No one comes to court with unclean hands. Dispositive: The petition is denied. Decision of CA is affirmed.

Doctrine: There could be no implied trust when contrary intention was proven. Facts: Petitioners version: On July 15, 1981, Felomina, a spinster, pharmacist and aunt of private respondent Lucila Ponce, purchased from the late Estela Caldoza-Pacres a parcel of agricultural land with the intention of giving said lot to her niece, Lucila. The latter was named as the buyer in the deed of sale. Subsequently, Felomina applied for the issuance of title in the name of her niece. Said title, however, remained in the possession of Felomina who developed the lot through Juanario Torreon and paid taxes thereon. The relationship between Felomina and respondent spouses Romeo and Lucila Ponce, however, turned sour. The latter allegedly became disrespectful and ungrateful to the point of hurling her insults and even attempting to hurt her physically. Hence, Felomina filed the instant case for revocation of implied trust to recover over the property. Respondent spouses version: Respondent spouses claim that they are the ones who paid for the said parcel of land. In 1987, the spouses consented to Felominas proposal to develop and lease the lot. They, however, shouldered the real property taxes on the lot, which was paid through Felomina. In 1990, the spouses demanded rental from Felomina but she refused to pay because her agricultural endeavor was allegedly not profitable. When Lucila learned that a certificate of title in her name had already been issued, she confronted Felomina who claimed that she already gave her the title. Thinking that she might have misplaced the title, Lucila executed an affidavit of loss which led to the issuance of another certificate of title in her name. On August 28, 2000, the trial court rendered a decision holding that an implied trust existed between Felomina and Lucila, such that the latter is merely holding the lot for the benefit of the former. It thus ordered the conveyance of the subject lot in favor of Felomina. Private respondent spouses appealed to the Court of Appeals which set aside the decision of the trial court ruling that Felomina failed to prove the existence of an implied trust and upheld respondent spouses ownership over the litigated lot. Felomina filed a motion for reconsideration but the same was denied. Hence, the instant petition. Issue/s: Whos the owner of the land? Held: The SC found that Felomina is the owner based on the records and transcript of stenographic notes. The positive and consistent testimony of Felomina alone, that she was the real vendee of the lot, is credible to debunk the contrary claim of respondent spouses. Indeed, the lone testimony of a witness, if credible, is sufficient as in the present case. Moreover, Aquilino Caldoza, brother of the vendor and one of the witnesses to the deed of sale, categorically declared that Felomina was the buyer and the one who paid the purchase price to her sister, Estela. Then too, Juanario, who was allegedly hired by Lucila to develop the lot, vehemently denied that he approached and convinced

Case 18: G.R. No. 160488 FELOMINA

[1]

ABELLANA, Petitioner, v.

SPOUSES ROMEO PONCE and LUCILA PONCE and the REGISTER OF DEEDS of BUTUAN CITY, Respondents.

Promulgated: September 3, 2004

Lucila to let him till the land. According to Juanario, he had never spoken to Lucila about the lot and it was Felomina who recruited him to be the caretaker of the litigated property. What Felomina executed was a donation hence no implied trust was created between them. However such donation was invalid since the donation was contrary to the form required by Article 749 of the Civil Code which requires that a donation of an immovable should be made in a public document. The donation made in this case was an oral donation of an immovable which is void. Article 1448 of the Civil Code on implied trust finds no application in the instant case. The concept of implied trusts is that from the facts and circumstances of a given case, the existence of a trust relationship is inferred in order to effect the presumed intention of the parties. Thus, one of the recognized exceptions to the establishment of an implied trust is where a contrary intention is proved, as in the present case. From the testimony of Felomina herself, she wanted to give the lot to Lucila as a gift. To her mind, the execution of a deed with Lucila as the buyer and the subsequent issuance of title in the latters name were the acts that would effectuate her generosity. In so carrying out what she conceived, Felomina evidently displayed her unequivocal intention to transfer ownership of the lot to Lucila and not merely to constitute her as a trustee thereof. It was only when their relationship soured that she sought to revoke the donation on the theory of implied trust, though as previously discussed, there is nothing to revoke because the donation was never perfected. Dispositive: WHEREFORE, in view of all the foregoing, the petition is GRANTED and the June 16, 2003 decision of the Court of Appeals in CA-G.R. CV No. 69213 is REVERSED and SET ASIDE. The August 28, 2000 decision of the Regional Trial Court of Butuan City, Branch 2, in Civil Case No. 4270, is REINSTATED with the following MODIFICATIONS: (1) Declaring petitioner Felomina Abellana as the absolute owner of Lot 3, Pcs-10-000198; (2) Ordering the Register of Deeds of Butuan City to cancel TCT No. T-2874 in the name of respondent Lucila Ponce and to issue a new one in the name of petitioner Felomina Abellana; and (3) Deleting the awards of attorneys fees and litigation expenses for lack of basis. No pronouncement as to costs. FACTS: appellee J. araneta was assigned as trustee of property bequeathed by the deceased to some of her heirs, including her grandchildrenby the late Angela Tuason pursuant to the provisions of a will. Later, appellee moved for the approval of accounts and the fixing of compensation as such trustee. Appellants wife, Mrs. Perez, as well as the mother and guardian at the time, of said minors, objected thereto and urged the court to remove appellee as trustee and appoint the Philippine Trust in his place and to revoke, not only certain sale made by him, but, also, an order of the court dated March 24, 1950, granting him the power to sell trust properties without special judicial authorization therefor. After appropriate proceedings, said Court issued on December 23, 1950, an order approving said accounts, deferring action on the compensation of the trustee, modifying in part said order of March 24, 1950, and denying the motion of Mrs. Perez. LOWER COURT SAID : It being established that the trust was expressly created by the deceased, we shall now examine whether the trustee comes under the active supervision of the Court and whether our order of March 24, 1950, granting to said trustee authority to the trust res without the need of judicial authorization erroneous or not. The Court accepts in view urged by the trustee that only when the testator "has omitted in his will to appoint a trustee" may the Court appoint one. This is in a accordance with Section 2, Rule 99, of the . When an express trust has been created, the powers of the trust shall be determined by the trust instrument itself. In this particular case, the trustee J. Antonio Araneta was given "amplios poderes de vender los mismos". The testatrix emphasizes her desire that the trustee shall have ample powers when in another part of her will she states that the powers of said trustee shall be "los poderes mas amplios permitidos por la ley". There is nothing against the law for a trustor to grant to the trustee ample powers, and when the deceased Angela S. Tuason granted said powers to the trustee, she emphasized her intention that in the exercise of said powers by the trustee, there should be no court supervision. "By the terms of trust, it may be left to the discretion of the trustee whether or not to exercise a power, or where he is directed to exercise the power, the time and manner of its exercise may be left to his discretion. To the extent to which the trustee has discretion, the Court will not control his exercise as long as he do not exceed the limits of the discretion conferred upon him. The court will not substitute its own judgment for his . . . . The cases are numerous in which it has been held that where discretion is conferred upon the trustee with respect to the exercise of a power, the court will not interfere with him in his exercise or failure to exercise the power so long as he is not guilty of an abuse of discretion. WHEREFORE, (1) the accounts filed by the trustee as per Annexes A, B, and C attached to his motion of October 5, 1950 are hereby approved; (2) the petition of trustee to fix his compensation is hereby deferred until such time as he shall present it again; (3) the petition filed by the parents of the minors for the removal of the trustee J. Antonio Araneta is hereby denied. Likewise, their petition

Case 19 TRUSTEESHIP OF THE MINORS BENIGNO, ANGELA and ANTONIO all surnamed PEREZ Y TUASON, PHILIPPINE NATIONAL BANK, Judicial Guardian of BENIGNO PEREZ, ANTONIO M. PEREZ, judicial guardian-appellant, vs. J. ANTONIO ARANETA, trustee-appellee DOCTRINE: . When an express trust has been created, the powers of the trust shall be determined by the trust instrument itself. There is nothing against the law for a trustor to grant to the trustee ample powers To the extent to which the trustee has discretion, the Court will not control his exercise as long as he do not exceed the limits of the discretion conferred upon him.

that the Philippine Trust Co. or Atty. Frank W. Brady be appointed co-trustee denied; 4) the petition that the sale of the bed in favor of Antonio Tuason, Jr. be revoked is hereby denied; and (5) the petition that the order of this court, dated March 24, 1950, giving the trustee power to sell without the need of judicial authorization be revoked is also hereby denied.

Mrs. Perez filed with the Supreme Court a petition G.R. No. L-6182 thereof for certiorari In a decision promulgated April 13, 1955, we denied said petition and dissolved said writ of preliminary injunction. Later, appellee wrote appellant informing him of a proposed sale to Ortigas & Co., Ltd., of several lots under trusteeship, located in Marikina, Rizal, and aggregating 42.6091 hectares, at the rate of P2.93 a square meter. Three (3) days later, appellant informed appellee by letter (Exhibit C) of his (appellant's) objections to the proposed sale. Moreover, on July 1, 1959 appellant filed, in the trusteeship proceedings, a motion praying for a writ of preliminary injunction to restrain appellee from proceeding with the sale. After due hearing, the lower court issued an order, dated October 15, 1959, denying appellant's motion and petition for a writ of preliminary injunction. Hence, this appeal by Antonio M. Perez. The Philippine has not joined him in the appeal. Subsequently, appellee effected the sale aforementioned to Ortigas & Co., Ltd. ISSUE: whether the sale thereof would be injurious to the interest of the beneficiaries or cestui que trust HELD: NO RATIO: This pretense is predicated, however, upon sheer speculation. Furthermore, the last will and testament of Angela S. Tuason, in pursuance of which the trust was established, provides that: SPANISH BLAH BLAH Referring to this provision of said will, we had occasion to say in G.R. No. L-6182: . . . throughout clause 4 of the will, one can see that the testatrix placed implicit confidence and trust in Araneta whom she designated as trustee, and for him to continue for a long time, not only until the minor children of Angela S. Tuason including those yet unborn, attained the age of majority but only when a majority of them decided to end the trust. In short, the trustor had such faith and confidence appellee that she relied fully upon his judgment and discretion. The exercise thereof by appellees should not be disturbed, therefore, except upon clear proof of fraud or bad faith, or unless the transaction in question is manifestly prejudicial to the interest of the minors aforementioned petitioned. Such is not the situation obtaining in the present case. WHEREFORE, the orders appealed from are hereby affirmed, with costs against the appellant. It is so ordered.