Catalan vs Basa

This case involves a donation contracted by a person

diagnosed with schizophrenia.
Facts: October 20, 1948, FELICIANO CATALAN
(Feliciano) was discharged from active military service.
The Board of Medical Officers of the Department of
Veteran Affairs found that he was unfit to render military
service due to his schizophrenic reaction, catatonic type,
which incapacitates him because of flattening of mood and
affect, preoccupation with worries, withdrawal, and sparce
(sic) and pointless speech.
September 28, 1949, Feliciano married Corazon Cerezo
June 16, 1951, a document was executed, titled Absolute
Deed of Donation, wherein Feliciano allegedly donated to
his sister MERCEDES CATALAN(Mercedes) one-half of the
real property
December 11, 1953, Peoples Bank and Trust Company
filed Special Proceedings No. 4563 before the Court of
First Instance of Pangasinan to declare Feliciano
incompetent. On December 22, 1953, the trial court issued
its Order for Adjudication of Incompetency for Appointing
Guardian for the Estate and Fixing Allowance of Feliciano.
The following day, the trial court appointed Peoples Bank
and Trust Company as Felicianos guardian. Peoples
Bank and Trust Company has been subsequently renamed,
and is presently known as the Bank of the Philippine
Islands (BPI).
[3]

[6]

[7]

[8]

On November 22, 1978, Feliciano and Corazon Cerezo

donated Lots 1 and 3 of their property, registered under
Original Certificate of Title (OCT) No. 18920, to their son
Eulogio Catalan.
[9]

On March 26, 1979, Mercedes sold the property in issue in

favor of her children Delia and Jesus Basa. The Deed of
Absolute Sale was registered with the Register of Deeds of
Pangasinan on February 20, 1992, and Tax Declaration No.
12911 was issued in the name of respondents.
[10]

[11]

doubts about the authenticity of the deed of sale, saying

that its registration long after the death of Mercedes
Catalan indicated fraud. Thus, BPI sought remuneration
for incurred damages and litigation expenses.
Trial Court: trial court found that the evidence presented by
the complainants was insufficient to overcome the
presumption that Feliciano was sane and competent at the
time he executed the deed of donation in favor of Mercedes
Catalan. Thus, the court declared, the presumption of
sanity or competency not having been duly impugned, the
presumption of due execution of the donation in question
must be upheld
CA: Affirmed Trial Court
Petitioners aver that the presumption of Felicianos
competence to donate property to Mercedes had been
rebutted because they presented more than the requisite
preponderance of evidence. First, they presented the
Certificate of Disability for the Discharge of Feliciano Catalan
issued on October 20, 1948 by the Board of Medical Officers of
the Department of Veteran Affairs. Second, they proved that
on December 22, 1953, Feliciano was judged an incompetent
by the Court of First Instance of Pangasinan, and put under the
guardianship of BPI. Based on these two pieces of evidence,
petitioners conclude that Feliciano had been suffering from a
mental condition since 1948 which incapacitated him from
entering into any contract thereafter, until his death on August
14, 1997. Petitioners contend that Felicianos marriage to
Corazon Cerezo on September 28, 1948 does not prove that
he was not insane at the time he made the questioned
donation. They further argue that the donations Feliciano
executed in favor of his successors (Decision, CA-G.R. CV No.
66073) also cannot prove his competency because these
donations were approved and confirmed in the guardianship
proceedings. In addition, petitioners claim that the Deed of
Absolute Sale executed on March 26, 1979 by Mercedes
Catalan and her children Jesus and Delia Basa is simulated
and fictitious. This is allegedly borne out by the fact that the
document was registered only on February 20, 1992, more that
10 years after Mercedes Catalan had already died. Since
Delia Basa and Jesus Basa both knew that Feliciano was
incompetent to enter into any contract, they cannot claim to be
innocent purchasers of the property in question. Lastly,
petitioners assert that their case is not barred by prescription or
laches under Article 1391 of the New Civil Code because they
had filed their case on April 1, 1997, even before the four year
period after Felicianos death on August 14, 1997 had begun.
[19]

[20]

On June 24, 1983, Feliciano and Corazon Cerezo donated

Lot 2 of the aforementioned property registered under OCT
No. 18920 to their children Alex Catalan, Librada Catalan
and Zenaida Catalan. On February 14, 1983, Feliciano
and Corazon Cerezo donated Lot 4 (Plan Psu-215956) of
the same OCT No. 18920 to Eulogio and Florida Catalan
BPI Contentions:
April 1, 1997, BPI, acting as Felicianos guardian, filed a
case for Declaration of Nullity of Documents, Recovery of
Possession and Ownership,[13] as well as damages against
the herein respondents. BPI alleged that the Deed of
Absolute Donation to Mercedes was void ab initio, as
Feliciano never donated the property to Mercedes. In
addition, BPI averred that even if Feliciano had truly
intended to give the property to her, the donation would still
be void, as he was not of sound mind and was therefore
incapable of giving valid consent. Thus, it claimed that if
the Deed of Absolute Donation was void ab initio, the
subsequent Deed of Absolute Sale to Delia and Jesus
Basa should likewise be nullified, for Mercedes Catalan
had no right to sell the property to anyone. BPI raised

Issue: Whether the donation made by Feliciano is valid?

Ruling:
GR: In order for donation to be valid, what is crucial is the
donor's capacity to give consent at the time of the donation;
the burden of proving incapacity rests upon the person who
alleges it.
A donation is an act of liberality whereby a person disposes
gratuitously a thing or right in favor of another who accepts
it.
Requisites of consent in contract: 1. it should be intelligent
or with an exact notion of the mater to which it refers; 2 it
should be free 3. it should be spontaneous
A person suffering from schizophrenia does not necessarily

lose his competence to intelligently dispose his property.

feelings and are prone to have ideas of reference. The

latter refers to the idea that random social behaviors are
directed against the sufferers. It has been proven that the
administration of the correct medicine helps the patient.
Antipsychotic medications help bring biochemical
imbalances closer to normal in a schizophrenic.
Medications reduce delusions, hallucinations and
incoherent thoughts and reduce or eliminate chances of
relapse. Schizophrenia can result in a dementing illness
similar in many aspects to Alzheimers disease. However,
the illness will wax and wane over many years, with only
very slow deterioration of intellect.
[27]

From scientific studies it had been deduced that a person

suffering from schizophrenia does no necessarily lose his
competence to intelligently dispose his property. By merely
alleging schizophrenia, petitioners failed to show
substantial proof from the date of donation, June 16,1951,,
Feliciano Catalan had lost total control of his mental
faculties.
Thus, the lower court correctly held that Feliciano was of
sound mind at that time and that this condition continued
to exist until proof to the contrary was adduced. Sufficient
proof of his infirmity was only established when theCOurt of
First Instance of Pangasinan declared him an incompetent
on Dec 22,1953
Competence and freedom from undue influence, shown to
have existed in the other acts done or contracts executed,
are presumed to continue until the contrary is shown. It is interesting to note that the petitioners questioned
Feliciano's capacity at the time he donated the property, yet
did not see fit to question his mental competence when he
entered into a contract of marriage with Corazon Cerezo or
when he executed deeds of donation of his other properties
in their favor.
The presumption that Feliciano remained competent to
execute contracts, despite his illness, is bolstered by the
existence of these other contracts. Competency and
freedom from undue influence, shown to have existed in
the other acts done or contracts executed, are presumed to
continue until the contrary is shown.

Needless to state, since the donation was valid, Mercedes

had the right to sell the property to whomever she chose.
Not a shred of evidence has been presented to prove the
claim that Mercedes sale of the property to her children
was tainted with fraud or falsehood. It is of little bearing that
the Deed of Sale was registered only after the death of
Mercedes. What is material is that the sale of the property
to Delia and Jesus Basa was legal and binding at the time
of its execution. Thus, the property in question belongs to
Delia and Jesus Basa.
[33]

Notes about Schizophrenia:

A study of the nature of schizophrenia will show that
Feliciano could still be presumed capable of attending to
his property rights. Schizophrenia was brought to the
attention of the public when, in the late 1800s, Emil
Kraepelin, a German psychiatrist, combined hebrephrenia
and catatonia with certain paranoid states and called the
condition dementia praecox. Eugene Bleuler, a Swiss
psychiatrist, modified Kraepelins conception in the early
1900s to include cases with a better outlook and in 1911
renamed the condition schizophrenia. According to
medical references, in persons with schizophrenia, there is
a gradual onset of symptoms, with symptoms becoming
increasingly bizarre as the disease progresses. The
condition improves (remission or residual stage) and
worsens (relapses) in cycles. Sometimes, sufferers may
appear relatively normal, while other patients in remission
may appear strange because they speak in a monotone,
have odd speech habits, appear to have no emotional

[28]

Villanueva vs Chiong

Issue:
1.

This case involves a property of a couple that is

separated in fact. What is the effect of being separated
in fact to the conjugal partnership of gains, whether
the deed of absolute sale is void or voidable.
Facts:
Florentino and Elisera Chiong were married sometime in
January 1960 but have been separated in fact since 1975.
During their marriage, they acquired a lot situated at
Poblacion, Dipolog City. Sometime in 1985, Florentino sold
the one-half western portion of the lot to petitioners for
P8,000, payable in installments. Thereafter, Florentino
allowed petitioners to occupy the lot and build a store, a
shop, and a house thereon. Shortly after their last
installment payment on December 13, 1986, petitioners
demanded from respondents the execution of a deed of
sale in their favor. Elisera, however, refused to sign a deed
of sale.
July 5, 1991, Elisera filed with the RTC a Complaint for
Quieting of Title with Damages, docketed as Civil Case No.
4383. On February 12, 1992, petitioners filed with the RTC
a Complaint for Specific Performance with Damages,
docketed as Civil Case No. 4460. Upon proper motion, the
RTC consolidated these two cases.
On May 13, 1992, Florentino executed the questioned
Deed of Absolute Sale in favor of petitioners.
RTC:, annulled the deed of absolute sale dated May 13,
1992, and ordered petitioners to vacate the lot and remove
all improvements therein. The RTC likewise dismissed Civil
Case No. 4460, but ordered Florentino to return to
petitioners the consideration of the sale with interest from
May 13, 1992
CA: Affirmed the decision
Contentions of Villanueva: Petitioners contend that the
Court of Appeals erred when it held that the lot is conjugal
property. They claim that the lot belongs exclusively to
Florentino because respondents were already separated in
fact at the time of sale and that the share of Elisera, which
pertains to the eastern part of Lot No. 997-D-1, had
previously been sold to Spouses Jesus Y. Castro and Aida
Cuenca. They also aver that while there was no formal
liquidation of respondents' properties, their separation in
fact resulted in its actual liquidation. Further, assuming
arguendo that the lot is still conjugal, the transaction should
not be entirely voided as Florentino had one-half share
over it.
Contentions of Elisera: Elisera, for her part, counters that
the sale of the lot to petitioners without her knowledge,
consent or authority, was void because the lot is conjugal
property. She adds that the sale was neither authorized by
any competent court nor did it redound to her or their
children's benefit. As proof of the lot's conjugal nature, she
presented a transfer certificate of title, a real property tax
declaration, and a Memorandum of Agreement dated
November 19, 1979 which she and her husband had
executed for the administration of their conjugal properties

2.

Is the subject lot exclusive propert of Florentino?

No, Conjugal
Whether or not the sale by Florentino is valid
without Eliseras valid consent? Voidable

1 - Respondents' separation in fact neither affected the

conjugal nature of the lot nor prejudiced Elisera's
interest over it. Under Article 178 of the Civil Code, the
separation in fact between husband and wife without
judicial approval shall not affect the conjugal partnership.
The lot retains its conjugal nature.
Likewise, under Article 160 of the Civil Code, all property
acquired by the spouses during the marriage is presumed
to belong to the conjugal partnership of gains, unless it is
proved that it pertains exclusively to the husband or to the
wife. Petitioners' mere insistence as to the lot's supposed
exclusive nature is insufficient to overcome such
presumption when taken against all the evidence for
respondents.
16

17

On the basis alone of the certificate of title, it cannot be

presumed that the lot was acquired during the marriage
and that it is conjugal property since it was registered "in
the name of Florentino Chiong, Filipino, of legal age,
married to Elisera Chiong ." But Elisera also presented a
real property tax declaration acknowledging her and
Florentino as owners of the lot. In addition, Florentino and
Elisera categorically declared in the Memorandum of
Agreement they executed that the lot is a conjugal
property. Moreover, the conjugal nature of the lot was
admitted by Florentino in the Deed of Absolute Sale dated
May 13, 1992, where he declared his capacity to sell as a
co-owner of the subject lot.
18

19

20

2 - Without the wife's consent, the husband's alienation or

encumbrance of conjugal property prior to the effectivity of
the Family Code on August 3, 1988 is not void, but merely
voidable.
- The sale by Florentino without Elisera's consent is not
however void ab initio.
The sale by Florentino without Elisera's consent is not,
however, void ab initio. In Vda. de Ramones v.
Agbayani,21 citing Villaranda v. Villaranda,22 we held that
without the wife's consent, the husband's alienation or
encumbrance of conjugal property prior to the effectivity of
the Family Code on August 3, 1988 is not void, but merely
voidable. Articles 166 and 173 of the Civil Code 23 provide:
ART. 166. Unless the wife has been declared
a non compos mentis or a spendthrift, or is under
civil interdiction or is confined in a
leprosarium, the husband cannot alienate or
encumber any real property of the conjugal
partnership without the wife's consent
This article shall not apply to property acquired by
the conjugal partnership before the effective date
of this Code.

14

ART. 173. The wife may, during the marriage,

and within ten years from the
transaction questioned, askthe courts for

the annulment of any contract of the husband

entered into without her consent, when such
consent is required, or any act or contract of the
husband which tends to defraud her or impair her
interest in the conjugal partnership property.
Should the wife fail to exercise this right, she or
her heirs, after the dissolution of the marriage,
may demand the value of property fraudulently
alienated by the husband. (Emphasis supplied.)

In a case involving the annulment of sale executed by

the husband without the consent of the wife, it was
held that the alienation must be annulled in its entirety
and not only insofar as the share of the wife in the
conjugal property is concerned.
Petitioners finally contend that, assuming arguendo the
property is still conjugal, the transaction should not be
entirely voided as Florentino had one-half share over the
lot. Petitioners' stance lacks merit. In Heirs of Ignacia
Aguilar-Reyes v. Mijares 24 citing Bucoy v. Paulino, et
al.,25 a case involving the annulment of sale executed by
the husband without the consent of the wife, it was held
that the alienation must be annulled in its entirety and not
only insofar as the share of the wife in the conjugal
property is concerned. Although the transaction in the said
case was declared void and not merely voidable, the
rationale for the annulment of the whole transaction is the
same. Thus:
The plain meaning attached to the plain language
of the law is that the contract, in its entirety,
executed by the husband without the wife's
consent, may be annulled by the wife. Had
Congress intended to limit such annulment in so
far as the contract shall "prejudice" the wife, such
limitation should have been spelled out in the
statute. It is not the legitimate concern of this
Court to recast the law. As Mr. Justice Jose B. L.
Reyes of this Court and Judge Ricardo C. Puno of
the Court of First Instance correctly stated, "[t]he
rule (in the first sentence of Article 173)
revokes Baello vs. Villanueva, 54 Phil. 213
and Coque vs. Navas Sioca, 45 Phil. 430," in
which cases annulment was held to refer only to
the extent of the one-half interest of the wife
If a voidable contract is annuled, the restoration of what
has been given is proper. The effect of the annulment is to
wipe it out of existence, and to restore the parties, insofar
as legally and equitably possible, to their original situation
before the contract was entered into.
Additional Notes: The separation in fact between the
husband and wife without judicial approval shall not affect
conjugal partnership.
Art 160 all property acquired by the spouses during the
marriage is presumed to belong to the conjugal partnership
of gains, unless it is proved that it pertains exclusively to
the husband or wife. (Petitioner's mere insistence as to the
lot's supposed exclusive nature is insufficient to overcome
such presumption when taken against all the evidence for
respondents.

Ayson vs Paragas
This case involves an equitable mortgage and its
prescriptive period.
Facts:
The controversy commenced with the filing of an
ejectment complaint[3] on April 12, 1993 before Branch 1
of the Municipal Trial Court in Cities (MTCC) of Dagupan
City by herein petitioner Amado Z. Ayson, as represented
by his natural father Zosimo S. Zareno [4] (Zareno), against
respondent-spouses Felix and Maxima Paragas. The
complaint, docketed as Civil Case No. 9161, alleged,
among others, that: (1) petitioner is the registered owner of
the property being occupied by the respondent-spouses as
shown by Transfer Certificate of Title No. 59036 of the
Registry of Deeds of Dagupan City in his name; (2)
respondent-spouses are occupying the said land through
his tolerance without rent; (3) on April 8, 1992, respondentspouses executed an Affidavit[5] which declared:
1.

That we are occupants of a

parcel of land (Lot 6595-A-2)
covered by Transfer Certificate
of Title No. 57684 located at
Caranglaan District, Dagupan
City owned by Amado Ll. Ayson;

2.

That we occupy the said

land by tolerance without paying
any rental whatsoever;

3.

That we further agree to

vacate the aforesaid land within
three (3) months from the date
hereof and to remove and
transfer our house therefrom to
another place;

4.

That in consideration of
vacating the said parcel of land
the amount of Twenty Thousand
Pesos (P20,000.00) shall be
paid to us; and, that the amount
of
Ten
Thousand
Pesos
(P10,000.00) shall be paid upon
signing of this affidavit and the
balance of Ten Thousand Pesos
(P10,000.00) shall be paid upon
removal of our house on the
third month from date hereof.

the

preliminary

admissions were made

conference,

the

(1)

That
the
defendants
(respondent spouses) had
been in possession of the
land in question since
1930; and

(2)

That the semi-concrete

house of the defendants
(respondent
spouses)
stands on the land in
question.

By respondent spouses:
(1)

That
the
defendant
(respondent) Felix Paragas
had executed an affidavit
on April 8, 1992 wherein he
admitted
that
he
is
occupying the land by
tolerance of the plaintiff
(petitioner) without paying
any rental whatsoever and
had agreed to vacate the
premises within three (3)
months but refused to
vacate later;

(2)

That
the
plaintiff
(petitioner) is the registered
owner of the land in
question;

(3)

That there was a demand

to vacate the premises;
and

(4)

That there is a Certification

to File Action in Court
MTCC Decided in favor of Ayson
RTC Affirmed the decision

Nullity of Sale

despite the receipt of the P10,000.00 upon the execution of

the Affidavit, respondent-spouses refused to vacate the
land as agreed upon; and (5) despite demands,
respondent-spouses still refused to vacate, thus
constraining him to file the complaint. Aside from
respondents vacating the land, petitioner prayed for the
return of the P10,000.00 he paid them; and the payment
of P10,000.00 actual damages, P10,000.00 exemplary
damages, P20,000.00 attorneys fees, and the costs.
During

By petitioner:

following

October 11, 1993, during the pendency of the appeal

with the RTC, respondent-spouses filed against petitioner,
as represented by his attorney-in-fact Zosimo S. Zareno,
the heirs of Blas F. Rayos, the spouses Delfin and Gloria
Alog, and Hon. Judge George M. Mejia, as Presiding Judge
of the Metropolitan Trial Court, Branch 1 of Dagupan City,
also before the RTC of Dagupan City, a complaint[13] for
declaration of nullity of deed of sale, transactions,
documents and titles with a prayer for preliminary
injunction and damages.
complaint alleged, inter alia, that respondent
Maxima is a co-owner of a parcel of land originally covered
by TCT No. 7316 of the Registry of Deeds of Dagupan City,
her share having an area of 435.75 square
meters. Sometime prior toApril 13, 1955, respondent Felix,

then an employee of the defunct Dagupan Colleges

(now University of Pangasinan) failed to account for the
amount of P3,000.00. It was agreed that respondent Felix
would pay the said amount by installment to the Dagupan
Colleges. Pursuant to that agreement, Blas F. Rayos and
Amado Ll. Ayson, then both occupying high positions in the
said institution, required respondent-spouses to sign,
without explaining to them, a Deed of Absolute Sale
on April 13, 1955over respondent Maximas real property
under threat that respondent Felix would be incarcerated
for misappropriation if they refused to do so.
The complaint further alleged that later,
respondent-spouses, true to their promise to reimburse the
defalcated amount, took pains to pay their obligation in
installments regularly deducted from the salaries received
by respondent Felix from Dagupan Colleges; that the
payments totaled P5,791.69; that notwithstanding the full
payment of the obligation, Amado Ll. Ayson and Blas F.
Rayos did nothing to cancel the purported Deed of
Absolute Sale; and that they were shocked when they
received a copy of the complaint for ejectment filed by
petitioner.
Petitioner adds that respondent-spouses are bound by estoppel
and guilty of laches in light of the judicial admissions they have
already made and the unreasonable length of time that had lapsed
before they questioned the validity of the Deed of Absolute Sale
and the Affidavit they executed on April 8, 1992.
He also asseverates that the Deed of Absolute Sale is a true
sale and not an equitable mortgage, arguing that the alleged
payments made by respondent Felix were made from December
29, 1965 to December 17, 1980, long after the execution of the
contract on April 13, 1955; that respondent-spouses only paid
realty taxes over their house and not on the disputed land; that
their possession of the property was by his mere tolerance; that
there was no evidence proffered that the amount ofP3,000.00 as
consideration for the sale was unusually inadequate in 1955; and
that the other co-owners of the land did not question or protest
the subdivision thereof leading to the issuance of TCT No. 59036
in his name.
Lastly, petitioner claims that he is a transferee in good
faith, having had no notice of the infirmity affecting the title of
his predecessor Amado Ll. Ayson over the property. He says that
he was only exercising his right as an heir when he adjudicated
unto himself the parcel of land pertaining to his adoptive father,
[18]
resulting in the issuance of TCT No. 59036 in his name, and,
thus, should not be penalized for his exercise of a legal right.
Ruling:
Ejectment case:
Nevertheless, it must be remembered that in
ejectment suits the issue to be resolved is merely
the physical possession over the property, i.e.,
possession de facto and not possession de jure,
independent of any claim of ownership set forth by
the party-litigants.[19] Should the defendant in an
ejectment case raise the defense of ownership in
his pleadings and the question of possession cannot
be resolved without deciding the issue of ownership,
the issue of ownership shall be resolved only to
determine the issue of possession.[20] The judgment

rendered in such an action shall be conclusive only

with respect to physical possession and shall in no
wise bind the title to the realty or constitute a
binding and conclusive adjudication of the merits on
the issue of ownership. Therefore, such judgment
shall not bar an action between the same parties
respecting the title or ownership over the property,
[21]
which action was precisely resorted to by
respondent-spouses in this case.

The Deed of Absolute Sale is, in reality, an equitable

mortgage or a contract of loan secured by a
mortgage. The Civil Code enumerates the cases in which
a contract, purporting to be a sale, is considered only as a
contract of loan secured by a mortgage, viz.:
Art. 1602. The contract shall be
presumed to be an equitable mortgage,
in any of the following cases:
(1)

When the price of the sale

with right to repurchase is
unusually inadequate;

(2)

When the vendor remains in

possession as lessee or
otherwise;

(3)

When upon or after the

expiration of the right to
repurchase another instrument
extending
the
period
of
redemption or granting a new
period is executed;

(4)

When the purchaser retains

for himself a part of the
purchase price;

(5)

When the vendor binds

himself to pay the taxes on the
thing sold;

(6)

In any other case where it

may be fairly inferred that the
real intention of the parties is
that the transaction shall
secure the payment of a debt
or the performance of any
other obligation.

In any of the foregoing cases,

any money, fruits, or other benefit to be
received by the vendee as rent or
otherwise shall be considered as interest
which shall be subject to the usury laws
Respondent-spouses have clearly proven that they have
already paid the aforesaid amount. That the obligation was paid
in installments through salary deduction over a period of 10 years
from the signing of the Deed of Absolute Sale is of no
moment. It is safe to assume that this repayment scheme was in
the nature of an easy payment plan based on the respondentspouses capacity to pay. Also noteworthy is that the deductions
from respondent Felixs salary amounted to a total ofP5,791.69,

[25]

or almost double the obligation of P3,000.00. Furthermore, it

cannot be denied that petitioner failed to adduce countervailing
proof that the payments, as evidenced by the volume of receipts,
were for some other obligation.

when petitioner's adoptive father Amado Ayson and Blas

Rayos, Felix's superiors at Dagupan Colleges, practically
bullied respondent-spouses into signing the deed of
absolute sale under threat of incarceration.

That the realty taxes paid by respondent-spouses was

only for their house can be explained by the fact that, until the
filing of the ejectment case, respondent Maxima was not aware
that the land she co-owned was already partitioned, such that the
payments of real estate taxes in her name were limited to the
improvement on the land.

Thus, the 4year period should start from the time the defect
in consent ceases. while at first gkancem it would seem
that the defect in the consent of the respondent-spouses
ceased either from the payment of the obligation through
salary deduction or from the death of Amado Ayson and
Rayos, it is apparent that such defect of consent never
ceased up to the time of the signing of the affidavit on
April 8,1992 when Zareno, acting on behalf of petitioner,
caused respondent Felix to be brought to him, and taking
advantage of the latter being unlettered, unduly influenced
Felix into executing the said affidavi for a fee of P10,000,

An equitable mortagage is a voidable contract; it may be

annuled within 4 years from the time the cause of action
accrues. An equitable mortgage is a voidable contract. As
such, it may be annuled within 4 years from the time the
cause of actuin accures.
This case, however, not only involves a contract resulting
from fraud but covers a trasaction ridden with threat,
intimidation, and continuing undue influence which started

The compalint praying for the nullity of the Deed of

Absolute Sale was filed on October 11,1993, within the 4year prescriptive period.