ATP Jurisprudence From 2005-2015

2005 Jurisprudence on Trusts
Sps. Gomez v. Duyan

GR No. 144148
Mar. 18, 2005
Art. 1444
Even if the word trust was not expressly used by the signatories to an agreement, the
establishment of an express trust cannot be discounted. Under the Civil Code, No
particular words are required for the creation of an express trust, it being sufficient that a
trust is clearly intended.
In a decision penned by Justice Paras, this Court held that under the law on Trusts, it
is not necessary that the document expressly state and provide for the express trust, for
it may even be created orally, no particular words are required for its creation (Art. 1444,
Civil Code).
A trust is sacred and inviolable. The courts have therefore shielded fiduciary
relations against every manner of chicanery or detestable design cloaked by legal
technicalities.
Vda. De Rigonan v. Derecho

GR No. 159571
July 15, 2005
Art. 1456
An implied trust arises, not from any presumed intention of the parties, but by operation
of law in order to satisfy the demands of justice and equity and to protect against unfair
dealing or downright fraud. Under Article 1456 of the new Civil Code, "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." Although this provision is not retroactive in character, it expresses a rule
already recognized by our courts prior to the effectivity of the Code.
Sps. Bejoc v. Cabreros
GR No. 145849
Aug. 22, 2005
Art. 1456
An implied trust is one that, without being express, is deducible from the nature of the
transaction as a matter of intent or which is superinduced on the transaction by
operation of law as a matter of equity, independently of the particular intention of the
parties. It may either be resulting or constructive trust.
1 | Page
A resulting trust is presumed to have been contemplated by the parties, the intention as
to which is to be found in the nature of their transaction but not expressed in the deed
itself. It is based on the equitable doctrine that valuable consideration, not legal title,
determines the equitable title or interest.
A constructive trust is created, not by any word evincing a direct intention to create a
trust, but by operation of law in order to satisfy the demands of justice and to prevent
unjust enrichment. It arises contrary to an agreement or intention against one who, by
fraud, duress or abuse of confidence, obtains or holds the legal right to property which
he ought not, in equity and good conscience, to hold. A constructive trust is illustrated in
Article 1456 of the Civil Code:
ARTICLE 1456. If the property is acquired through mistake or fraud, the person
obtaining it is by force of law, considered a trustee of an implied trust for the
benefit of the person from whom the property comes.
Anzar Bros. Realty Co. v. Aying
GR. No. 144773
May 16, 2005
Article 1456
Article 1456 reveals that it is not a trust in the technical sense for in a typical trust,
confidence is reposed in one person who is named a trustee for the benefit of another
who is called the cestui que trust, respecting property which is held by the trustee for
the benefit of the cestui que trust. A constructive trust, unlike an express trust, does not
emanate from, or generate a fiduciary relation. While in an express trust, a beneficiary
and a trustee are linked by confidential or fiduciary relations, 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.
Article 1456 reveals that it is not a trust in the technical sense for in a typical trust,
confidence is reposed in one person who is named a trustee for the benefit of another
who is called the cestui que trust, respecting property which is held by the trustee for
the benefit of the cestui que trust. A constructive trust, unlike an express trust, does not
emanate from, or generate a fiduciary relation. While in an express trust, a beneficiary
and a trustee are linked by confidential or fiduciary relations, 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.
Resulting trusts are based on the equitable doctrine that valuable consideration and not
legal title determines the equitable title or interest and are presumed always to have
been contemplated by the parties. They arise from the nature of circumstances of the
consideration involved in a transaction whereby one person thereby becomes invested
with legal title but is obligated in equity to hold his legal title for the benefit of another.
2 | Page
On the other hand, constructive trusts are created by the construction of equity in order
to satisfy the demands of justice and prevent unjust enrichment. They arise contrary to
intention against one who, by fraud, duress or abuse of confidence, obtains or holds the
legal right to property which he ought not, in equity and good conscience, to hold.
Vda. De Gualberto v. Go
GR No. 139843
Aug. 21, 2005
An action for reconveyance of real property based on implied or constructive trust is not
barred by the aforementioned 10-year prescriptive period only if the plaintiff is in actual,
continuous and peaceful possession of the property involved. If a person claiming to be
the owner thereof is in actual possession of the property, the right to seek
reconveyance, which in effect seeks to quiet title to the property, does not prescribe.
The reason for this is that one who is in actual possession of a piece of land claiming to
be the owner thereof may wait until his possession is disturbed or his title is attacked
before taking steps to vindicate his right, the reason for the rule being, that his
undisturbed possession gives him a continuing right to seek the aid of a court of equity
to ascertain and determine the nature of the adverse claim of a third party and its effect
on his own title, which right can be claimed only by one who is in possession.
SPOUSES JOSE BEJOC and JOVITA CAPUTOL BEJOC, petitioners, vs. PRIMA
CALDERON CABREROS and COURT OF APPEALS, respondents
G.R. No. 145849
July 22, 2005
ARTICLE 1456, An implied trust is one that, without being express, is deducible
from the nature of the transaction as a matter of intent or which is superinduced on the
transaction by operation of law as a matter of equity, independently of the particular intention of the parties.[13] It may either be resulting or constructive trust.
A resulting trust is presumed to have been contemplated by the parties, the intention as to which is to be found in the nature of their transaction but not expressed in the
deed itself.[14] It is based on the equitable doctrine that valuable consideration, not legal
title, determines the equitable title or interest.[15]
A constructive trust is created, not by any word evincing a direct intention to create
a trust, but by operation of law in order to satisfy the demands of justice and to prevent
unjust enrichment. It arises contrary to an agreement or intention against one who, by
fraud, duress or abuse of confidence, obtains or holds the legal right to property which
he ought not, in equity and good conscience, to hold.
3 | Page
ONSUELO N. VDA. DE GUALBERTO, FE GUALBERTO-CHAVEZ, AMADOR GUALBERTO, CESAR GUALBERTO, RODOLFO GUALBERTO, LUZVIMINDA GUALBERTO MIRANA, and VIRGINIA GUALBERTO,petitioners, vs. FRANCISCO H. GO,
RAYMUNDO J. GO, MIRIAM J. GO, MIRIAM G. SON, VICENTE J. GO, BELEN GO,
and ROSA JAVIER GO, respondents.
G.R. No. 139843
July 21, 2005
Article 1144. An action for reconveyance based on an implied or constructive
trust must perforce prescribe in ten years and not otherwise.
A long line of decisions of this Court, and of very recent vintage at that, illustrates
this rule. Undoubtedly, it is now well-settled that an action for reconveyance based on
an implied or constructive trust prescribes in ten years from the issuance of the Torrens
title over the property. The only discordant note, it seems, is Balbin v. Medalla, which
states that the prescriptive period for a reconveyance action is four years. However, this
variance can be explained by the erroneous reliance on Gerona v. de Guzman. But in
Gerona, the fraud was discovered on June 25, 1948, hence Section 43(3) of Act No.
190 was applied, the New Civil Code not coming into effect until August 30, 1950 as
mentioned earlier. It must be stressed, at this juncture, that Article 1144 and Article
1456, are new provisions. They have no counterparts in the old Civil Code or in the old
Code of Civil Procedure, the latter being then resorted to as legal basis of the four-year
prescriptive period for an action for reconveyance of title of real property acquired under
false pretenses.
AZNAR BROTHERS REALTY COMPANY, petitioner, vs. LAURENCIO AYING, IN
HIS OWN BEHALF AND IN BEHALF OF THE OTHER HEIRS OF EMILIANO AYING,
PAULINO AYING, IN HIS OWN BEHALF AND IN BEHALF OF THE OTHER HEIRS
OF SIMEON AYING, AND WENCESLAO SUMALINOG, IN HIS OWN BEHALF AND
IN BEHALF OF THE OTHER HEIRS OF ROBERTA AYING, respondents
G.R. No. 144773
May 16, 2005
ART. 1456
A deeper analysis of Article 1456 reveals that it is not a trust in the technical sense
for in a typical trust, confidence is reposed in one person who is named a trustee for the
benefit of another who is called the cestui que trust, respecting property which is held by
the trustee for the benefit of the cestui que trust. A constructive trust, unlike an express
trust, does not emanate from, or generate a fiduciary relation. While in an express trust,
a beneficiary and a trustee are linked by confidential or fiduciary relations, in a constructive trust, there is neither a promise nor any fiduciary relation to speak of and the socalled trustee neither accepts any trust nor intends holding the property for the beneficiaries.
The concept of constructive trusts was further elucidated in the same case, as follows:
. . . 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
4 | Page
by operation of law as matters of equity, independently of the particular intention of the

parties. In turn, implied trusts are either resulting or constructive trusts. These two are
differentiated from each other as follows:
Resulting trusts are based on the equitable doctrine that valuable consideration
and not legal title determines the equitable title or interest and are presumed always to
have been contemplated by the parties. They arise from the nature of circumstances of
the consideration involved in a transaction whereby one person thereby becomes invested with legal title but is obligated in equity to hold his legal title for the benefit of another. On the other hand, constructive trusts are created by the construction of equity in
order to satisfy the demands of justice and prevent unjust enrichment. They arise contrary to intention against one who, by fraud, duress or abuse of confidence, obtains or
holds the legal right to property which he ought not, in equity and good conscience, to
hold.
The rule that a trustee cannot acquire by prescription ownership over property
entrusted to him until and unless he repudiates the trust, applies to express trusts and
resulting implied trusts. However, in constructive implied trusts, prescription may supervene even if the trustee does not repudiate the relationship. Necessarily, repudiation of
said trust is not a condition precedent to the running of the prescriptive period.
SPS. FELIZA DUYAN GOMEZ and EUGENIO GOMEZ, petitioners, vs. PURISIMA
DUYAN, ROLANDO DUYAN, EMERITA DUYAN, DIGNA DUYAN, EDUARDO DUYAN,
LUCRECIA DUYAN, ROBERTO DUYAN, CRESENCIA DUYAN, RODRIGO DUYAN,
REULGINA DUYAN, DOMINICIA DUYAN, AVECENCIO DUYAN, MARIA SALOME
DUYAN and DIVINA DUYAN, respondents. G.R. No. 144148. March 18, 2005,
Art. 1440. A person who establishes a trust is called the trustor; one in whom
confidence is reposed as regards property for the benefit of another person is known as
the trustee; and the person for whose benefit the trust has been created is referred to as
the beneficiary. Even if the word trust was not expressly used by the signatories to the
10 February 1978 Pagpapahayag and the document did not expressly state that a trust
was being established by reason thereof, the establishment of an express trust cannot
be discounted. Under the Civil Code, No particular words are required for the creation of
an express trust, it being sufficient that a trust is clearly intended. In a decision penned
by Justice Paras, this Court held that under the law on Trusts, it is not necessary that
the document expressly state and provide for the express trust, for it may even be created orally, no particular words are required for its creation (Art. 1444, Civil Code).
The Pagpapahayag dated 10 February 1978 having been freely entered into by Eulogio
and Feliza, it had the force of law between them. It was therefore incumbent upon Feliza as trustee to comply with the provisions of the instrument and have the subject
property registered in the names of her nephews and nieces.
PHILIPPINE NATIONAL BANK,Petitioner, - versus -MERELO B. AZNAR; MATIAS B.

AZNAR III; JOSE L. AZNAR (deceased), represented by his heirs; RAMON A.
5 | Page
BARCENILLA; ROSARIO T. BARCENILLA; JOSE B. ENAD (deceased), represented by his heirs; and RICARDO GABUYA (deceased), represented by his heirs, Respondents.
G.R. No. 171805
Article 1444, Trust is the right to the beneficial enjoyment of property, the legal
title to which is vested in another. It is a fiduciary relationship that obliges the trustee to
deal with the property for the benefit of the beneficiary. Trust relations between parties
may either be express or implied. An express trust is created by the intention of the
trustor or of the parties. An implied trust comes into being by operation of law.
Express trusts, sometimes referred to as direct trusts, are intentionally created by
the direct and positive acts of the settlor or the trustor - by some writing, deed, or will or
oral declaration. It is created not necessarily by some written words, but by the direct
and positive acts of the parties.[22] This is in consonance with Article 1444 of the Civil
Code, which states that [n]o particular words are required for the creation of an express
trust, it being sufficient that a trust is clearly intended.
In other words, the creation of an express trust must be manifested with
reasonable certainty and cannot be inferred from loose and vague declarations or from
ambiguous circumstances susceptible of other interpretations
6 | Page

SPOUSES ANTHONY AND PERCITA OCO v. YARES-SANTIAGO, AUSTRIAMARTINEZ
GR NO. 161298
January 31, 2006
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.
Trust is the legal relationship between one person who has equitable ownership of a
property and another who owns the legal title to the property. The trustor is the one who
establishes the trust; the beneficiary, the person for whose benefit the trust was created;
and the trustee, the one in whom, by conferment of a legal title, confidence has been
reposed as regards the property of the beneficiary.
Trusts may be either express or implied. Express trusts are those created by direct and
positive acts of the parties, such as by some writing, deed or will; or by words either
expressly or impliedly evidencing an intention to create a trust. Implied trusts are those
that, without being expressed, are deducible from the nature of the transaction as
matters of intent; or that are super-induced in the transaction by operation of law as a
matter of equity, independently of the particular intention of the parties.
Under the last sentence of Article 1448, respondents alleged acts -- paying the price of
the subject properties and, in the titles, naming his children as owners -- raise the
presumption that a gift was effected in their favor. Respondent failed to rebut this
presumption. Absent any clear proof that a trust was created, he cannot be deemed a
real party in interest.That he should be deemed a trustor on the basis merely of having
paid the purchase price is plainly contradicted by the presumption based on Article 1448
of the Civil Code that there is a gift in favor of the child, not a trust in favor of the parent.
MARLENE CRISOSTOMO AND JOSE G. CRISOSTOMO v. FLORITO M. GARCIA JR.
GR NO. 164787
January 31, 2006
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.
Thus, it was held that when a party uses fraud or concealment to obtain a certificate of
title of property, a constructive trust is created in favor of the defrauded party.
Constructive trusts are created by the construction of equity in order to satisfy the
demands of justice and prevent unjust enrichment. They arise contrary to intention
against one who, by fraud, duress or abuse of confidence, obtains or holds the legal
right to property which he ought not, in equity and good conscience, to hold.
When property is registered in anothers name, an implied or constructive trust is
7 | Page
created by law in favor of the true owner.[38] The action for reconveyance of the title to
the rightful owner prescribes in 10 years from the issuance of the title.
Clearly, the applicable prescriptive period is ten years under Art. 1144 and not four years
under Arts. 1389 and 1391.
Applying the law and jurisprudential declaration above-cited to the allegations of fact in
the complaint, it can clearly be seen that respondent has a period of 10 years from the
registration of the title within which to file the action. Since the title was registered in the
name of the petitioners on 16 November 1993, respondent had a period of 10 years
from the time of the registration within which to file the complaint. Since the complaint
was filed on 20 June 2002, the action clearly has not prescribed and was timely-filed.
PAZ GALVEZ, CARLOS TAM, AND TYCOON PROPERTIES v. HONORABLE COURT
OF APPEALS AND PORFIRO GALVEZ
GR NO. 157954
March 24, 2006
Art. 1451. When land passes by succession to any person and he causes the legal title
to be put in the name of another, a trust is established by implication of law for the
benefit of the true owner.
In assailing the decisions of the trial and appellate courts, petitioners cite Article 1451 of
the Civil Code and claim that an implied or constructive trust which prescribes in ten
years, was established between Paz Galvez and Porfirio Galvez. It is petitioners
unflinching stand that the implied trust was repudiated when Paz Galvez executed an
Affidavit of Self-Adjudication on 4 May 1970, registered the same before the Register of
Deeds of La Union on 4 June 1970 and secured a new tax declaration in her name.
From 4 May 1970 to the time the complaint was filed on 12 May 1994, 24 years have
passed, hence, the action is clearly barred both by prescription and laches.
We find the petition bereft of merit.
In Salvador v. Court of Appeals, it was held that the possession of a co-owner is like that
of a trustee and shall not be regarded as adverse to the other co-owner but in fact
beneficial to all of them.
The case of Huang v. Court of Appeals is instructive on the creation of trust
relationships.
Trust is a fiduciary relationship with respect to property which involves the existence of
equitable duties imposed upon the holder of the title to the property to deal with it for the
benefit of another. A person who establishes a trust is called the trustor; one in whom
the beneficiary or cestui que trust. Trust is either express or implied. Express trust is
created by the intention of the trustor or of the parties. Implied trust comes into being by
operation of law. The latter kind is either constructive or resulting trust. A constructive
trust is imposed where a person holding title to property is subject to an equitable duty
to convey it to another on the ground that he would be unjustly enriched if he were
permitted to retain it. The duty to convey the property arises because it was acquired
through fraud, duress, undue influence or mistake, or through breach of a fiduciary duty,
or through the wrongful disposition of anothers property. On the other hand, a resulting
8 | Page
trust arises where a person makes or causes to be made a disposition of property under
circumstances which raise an inference that he does not intend that the person taking or
holding the property should have the beneficial interest in the property. It is founded on
the presumed intention of the parties, and as a general rule, it arises where, and only
where such may be reasonably presumed to be the intention of the parties, as
determined from the facts and circumstances existing at the time of the transaction out
of which it is sought to be established.
MARIA B. CHING v. JOSEPH C. GOYANKO, JR., EVELYN GOYANKO, JERRY
GOYANKO, IMELDA GOYANKO, JULIUS GOYANKO, MARY ELLEN GOYANKO,
JESS GOYANKO
GR NO. 165879
November 10, 2006
As the conveyance in question was made by Goyangko in favor of his common- lawwife-herein petitioner, it was null and void.
Petitioners argument that a trust relationship was created between Goyanko as trustee
and her as beneficiary as provided in Articles 1448 and 1450 of the Civil Code which
read:
ARTICLE 1448. There is an implied trust when property is sold, and the legal estate is
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.
ARTICLE 1450. If the price of a sale of property is loaned or paid by one person for the
benefit of another and the conveyance is made to the lender or payor to secure the
payment of the debt, a trust arises by operation of law in favor of the person to whom
the money is loaned or for whom it is paid. The latter may redeem the property and
compel a conveyance thereof to him.
does not persuade.
For petitioners testimony that it was she who provided the purchase price is
uncorroborated. That she may have been considered the breadwinner of the family and
that there was proof that she earned a living do not conclusively clinch her claim.
It follows that the second issue of whether an implied trust relationship was created
between Eusebio and his heirs as trustees and respondent as beneficiary must also be
resolved against respondent. We do not agree with the reasoning of the CA:
[A]fter the execution of the deed of assignment, [respondent] proceeded to buy the
front half portion from PHHC by paying the amortizations due thereon in exercise of the
right which he purchased by way of deed of assignment. He also established his
residence on this portion since he was then secure in the knowledge that he eventually
will own the same portion having also purchased this right to own in the deed of
assignment. Therefore, when the purchase price for the entire lot was finally paid, the
deed of its conveyance was finally executed and the title to the entire lot was issued in
Eusebio Pigaos name, an implied trust relationship was created over the front half
portion between Pigao and [respondent].
9 | Page
Per Article 1448 of the Civil Code, 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 party is referred to as the
trustee, while the latter is referred to as the beneficiary.
In the case at bench, the trustee is Pigao, who, with the title to the entire lot issued to
him, holds the front half portion thereof in trust for [respondent], who is the beneficiary.
The CA declared that Article 1448 of the Civil Code was applicable:
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.
In Morales v. Court of Appeals, we extensively discussed the concept of trust:
A trust is the legal relationship between one person having an equitable ownership in
property and another person owning the legal title to such property, the equitable
ownership of the former entitling him to the performance of certain duties and the
exercise of certain powers by the latter.
Trusts are either express or implied. Express trusts are created by the intention of the
trustor or of the parties, while implied trusts come into being by operation of law, either
through implication of an intention to create a trust as a matter of law or through the
imposition of the trust irrespective of, and even contrary to, any such intention. In turn,
implied trusts are either resulting or constructive trusts. Resulting trusts are based on
the equitable doctrine that valuable consideration and not legal title determines the
equitable title or interest and are presumed always to have been contemplated by the
parties. They arise from the nature or circumstances of the consideration involved in a
transaction whereby one person thereby becomes invested with legal title but is
obligated in equity to hold his legal title for the benefit of another.
ESTRELLA PIGAO, ROMEO PIGAO, EMMANUEL PIGAO, ISABELITA ABAD,
PURITA SARGITA, CESAR PIGAO, VIRGILIO PIGAO, AND EVANGELINE
KIUNISALA v.SAMUEL RABANILLO
GR NO. 150712
May 2, 2006
A resulting trust is exemplified by Article 1448 of the Civil Code xxx
Art. 1448. There is an implied trust when property is sold, and the legal estate is
beneficiary.
The trust created under the first sentence of Article 1448 is sometimes referred to as a
purchase money resulting trust. The trust is created in order to effectuate what the law
presumes to have been the intention of the parties in the circumstances that the person
to whom the land was conveyed holds it as trustee for the person who supplied the
purchase money.
To give rise to a purchase money resulting trust, it is essential that there be:
1. an actual payment of money, property or services, or an equivalent, constituting
valuable consideration;
2. and such consideration must be furnished by the alleged beneficiary of a resulting
10 | P a g e
trust.
There are recognized exceptions to the establishment of an implied resulting trust. The
first is stated in the last part of Article 1448 itself. Thus, where A pays the purchase
money and title is conveyed by absolute deed to A's child or to a person to whom A
stands in loco parentis and who makes no express promise, a trust does not result, the
presumption being that a gift was intended. Another exception is, of course, that in
which an actual contrary intention is proved. Also where the purchase is made in
violation of an existing statute and in evasion of its express provision, no trust can result
in favor of the party who is guilty of the fraud.
Another exception to the establishment of an implied resulting trust under Article 1448 is
when its enforcement contravenes public policy. We have already ruled that the transfer
of rights by Eusebio to respondent was null and void ab initio for being contrary to public
policy. As we held in Ramos v. Court of Appeals:
Otherwise stated, as an exception to the law on trusts, "[a] trust or a provision in the
terms of a trust is invalid if the enforcement of the trust or provision would be against
public policy, even though its performance does not involve the commission of a
criminal or tortious act by the trustee." The parties must necessarily be subject to the
same limitations on allowable stipulations in ordinary contracts, i.e., their stipulations
must not be contrary to law, morals, good customs, public order, or public policy. What
the parties then cannot expressly provide in their contracts for being contrary to law and
public policy, they cannot impliedly or implicitly do so in the guise of a resulting trust.
(emphasis supplied)
HEBRON v. PALAD
G.R. No. 149542
July 2006
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.
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.
As a rule, the burden of proving the existence of a trust is on the party asserting its
existence, and such proof. While implied trusts may be proved by oral evidence, the
evidence must be trustworthy and received by the courts with extreme caution, and
should not be made to rest on loose, equivocal or indefinite declarations. Trustworthy
evidence is required because oral evidence can easily be fabricated.
Thus, in order to establish an 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
11 | P a g e
by an authentic document.
An implied trust, in fine, cannot be established upon vague and inconclusive proof.
MARCELITO D. QUEVADA v. JUANITO N. VILLAVERDE,
G.R. No. 140798
September 19, 2006
Article 1450 of the Civil Code does not apply:
ARTICLE 1450. If the price of a sale of property is loaned or paid by one person for the
benefit of another and the conveyance is made to the lender or payer to secure the
The conveyance of the property was not from petitioner, but rather from its previous
owner, to private respondent. No evidence is presented to show that such conveyance
was to secure payment of a debt. Thus, there is no resulting trust. Private respondent is
under no obligation in equity to hold his legal title to the land for the benefit of petitioner.
There is no constructive trust either. Private respondent is not alleged to have obtained
or held the legal right thereto by fraud, duress, or abuse of confidence. Again, in the
absence of proof showing that private respondent has fraudulently registered the land in
his name, petitioner has no right to recover it under Article 1456 of the Civil Code, which
states:
ARTICLE 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.
While an implied trust may be proved orally (Civil Code of the Philippines, Art. 1457),
the evidence must be trustworthy and received by the courts with extreme caution,
because such kind of evidence may be easily fabricate. It cannot be made to rest on
vague and uncertain evidence or on loose, equivocal or indefinite declarations. The
burden of proving the existence of a trust is on the party asserting its existence, and
such proof must be clear and satisfactorily show the existence of the trust and its
elements.
JESUS DURAN and DEMETRIA A. DURAN, v. COURT OF APPEALS
G.R. No. 126973
May 2, 2006
In Morales v. Court of Appeals, we defined a trust and the categories of trust, viz:
Trusts are either express or implied. Express trusts are created by the intention of the
trustor or of the parties, while implied trusts come into being by operation of law, either
through implication of an intention to create a trust as a matter of law or through the
imposition of the trust irrespective of, and even contrary to, any such intention. In turn,
implied trusts are either resulting or constructive trusts.
been contemplated by the parties. They arise from the nature or circumstances of the
12 | P a g e

The burden of proving the existence of a trust is generally on the party asserting its
existence. Such proof must be clear and must satisfactorily show the existence of the
trust and its elements. While oral evidence may be presented to prove the existence of
an implied trust, such evidence must be trustworthy because oral evidence can easily
be fabricated. Further, the evidence must be received by the
courts with extreme caution. The existence of an implied trust should not be made to
rest on loose, equivocal and indefinite declarations.[
JUANITA NAVAL, - vs - COURT OF APPEALS, JUANITO CAMALLA, JAIME NACION,
CONRADO BALILA, ESTER MOYA and PORFIRIA AGUIRRE,
G.R. No. 167412
February 22, 2006
The Court of Appeals correctly held that an action for reconveyance does not prescribe
when the plaintiff is in possession of the land to be reconveyed, as in this case.
Thus, in Leyson v. Bontuyan:
This Court declared that an action for reconveyance based on fraud is
imprescriptible where the plaintiff is in possession of the property subject of the acts.
In Vda. de Cabrera v. Court of Appeals, the Court held:
An action for reconveyance of a parcel of land based on implied or constructive
trust prescribes in ten years, the point of reference being the date of registration of the
deed or the date of the issuance of the certificate of title over the property, but this rule
applies only when the plaintiff or the person enforcing the trust is not in possession of
the property, since if a person claiming to be the owner thereof is in actual possession
of the property, as the defendants are in the instant case, the right to seek
reconveyance, which in effect seeks to quiet title to the property, does not prescribe.
The reason for this is that one who is in actual possession of a piece of land claiming to
be the owner thereof may wait until his possession is disturbed or his title is attacked
before taking steps to vindicate his right, the reason for the rule being, that his
undisturbed possession gives him a continuing right to seek the aid of a court of equity
to ascertain and determine the nature of the adverse claim of a third party and its effect
on his own title, which right can be claimed only by one who is in possession.
Similarly, in the case of David v. Malay, the same pronouncement was reiterated by the
Court. There is settled jurisprudence that one who is in actual possession of a piece of
land claiming to be owner thereof may wait until his possession is disturbed or his title is
attacked before taking steps to vindicate his right, the reason for the rule being, that his
undisturbed possession gives him a continuing right to seek the aid of the court of
13 | P a g e
equity to ascertain and determine the nature of the adverse claim of a third party and its
effect on his own title, which right can be claimed only by one who is in possession. No
better situation can be conceived at the moment for Us to apply this rule on equity than
that of herein petitioners whose possession of the litigated property for no less than 30
years and was suddenly confronted with a claim that the land she had been occupying
and cultivating all these years, was titled in the name of a third person. We hold that in
such a situation the right to quiet title to the property, to seek its reconveyance and
annul any certificate of title covering it, accrued only from the time the one in possession
was made aware of a claim adverse to his own, and it is only then that the statutory
period of prescription commences to run against such possessor.
The paramount reason for this exception is based on the theory that registration
proceedings could not be used as a shield for fraud. Moreover, to hold otherwise would
be to put premium on land-grabbing and transgressing the broader principle in human
relations that no person shall unjustly enrich himself at the expense of another.
Article 1448 of the Civil Code on implied trust provides:
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.
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.
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:
Art. 736. Guardians and trustees cannot donate the property entrusted to them.
Truly, nobody can dispose of that which does not belong to him.
NESTOR MENDIZABEL, v. FERNANDO APAO
G.R. No. 143185
February 20, 2006
Action for Reconveyance Based on Implied Trust
In an action for reconveyance, all that must be alleged in the complaint are two facts
which, admitting them to be true, would entitle the plaintiff to recover title to the disputed
land, namely,
(1) that the plaintiff was the owner of the land or possessed the land in the
concept of owner and
(2) that the defendant had illegally dispossessed him of the land
In their complaint, respondents clearly asserted that:
14 | P a g e
(1) they were the true and actual possessors of the property;
(2) they purchased the property from spouses Alejandro and Teofila Magbanua
on 21 March 1955 as evidenced by a deed of sale pacto de retro which spouses
Magbanua executed in their favor;
(3) their ownership of the property became absolute when the vendors failed to
repurchase it within the period stipulated in their contract; and
(4) they were fraudulently deprived of ownership of the property when petitioners
obtained homestead patents and certificates of title in their names.
These allegations certainly measure up to the requisite statement of facts to constitute
an action for reconveyance based on an implied trust.
Indubitably, the act of petitioners in misrepresenting that they were in actual possession
and occupation of the property, obtaining patents and original certificates of title in their
names, created an implied trust in favor of the actual possessors of the property. The
Civil Code provides:
ART. 1456. If property is acquired through mistake or fraud, the person obtaining it is, by
In other words, if the registration of the land is fraudulent, the person in whose name
the land is registered holds it as a mere trustee, and the real owner is entitled to file an
action for reconveyance of the property.
Petitioners would nonetheless insist that respondents failed to present any proof of
fiduciary relation between them and respondents and breach of such trust by
petitioners.
Whether there is fiduciary relation between petitioners and respondents is of no
moment. Construing the provision of Article 1456, the Court in Aznar Brothers Realty
Company v. Aying stated:
A deeper analysis of Article 1456 reveals that it is not a trust in the technical
sense for in a typical trust, confidence is reposed in one person who is named a
trustee for the benefit of another who is called the cestui que trust, respecting
property which is held by the trustee for the benefit of the cestui que trust. A
constructive trust, unlike an express trust, does not emanate from, or generate a
fiduciary relation. While in an express trust, a beneficiary and a trustee are linked
by confidential or fiduciary relations, 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.
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
15 | P a g e
parties. In turn, implied trusts are either resulting or constructive trusts.

Constructive trusts are created by the construction of equity in order to satisfy the
demands of justice and prevent unjust enrichment. They arise contrary to intention
against one who, by fraud, duress or abuse of confidence, obtains or holds the legal
right to property which he ought not, in equity and good conscience, to hold.
16 | P a g e

Spouses Raul and Amalia Panlilio v. Citibank, N.A.
GR No. 156335
November 28, 2007
Art. 1440, NCC: A person who establishes a trust is called a trustor, one in whom the
the beneficiary.
Trust business shall refer to any activity resulting from a trustor-trustee
relationship (trusteeship) involving the appointment of a trustee by a trustor for the
administration, holding, management of funds and/or properties of the trustor by the
trustee for the use, benefit or advantage of the trustor or of others called beneficiaries.
Other fiduciary business shall refer to any activity of a trust-licensed bank resulting from
a contract or agreement whereby the bank binds itself to render services or to act in a
representative capacity such as in an agency, guardianship, administratorship of wills,
properties and estates, executorship, receivership, and other similar services which do
not create or result in a trusteeship.
Erlinda Asejo v. People of the Philippines
G.R. No. 157433
July 24, 2007
the beneficiary.
In a trust agreement, the transfer of the property to the trustee is mere physical
possession and not juridical possession. Unlike in a contract of loan where the debtor
acquires juridical possession and is technically the owner of the amount, in a trust, the
obligation of the trustee is fiduciary in nature, i.e. to take care of the thing strictly for the
benefit of the trustor in accordance with the purpose of the express trust.
Soledad Caezo v. Concepcion Rojas
G.R. No. 148788
November 23, 2007
Art. 1443, NCC: No express trusts concerning an immovable or any interest therein may
be proved by parol evidence.
Art. 1444, NCC: No particular words are required for the creation of an express trust, it
being sufficient that a trust is clearly intended.
17 | P a g e
A trust is the legal relationship between one person having an equitable

ownership of property and another person owning the legal title to such property, the
equitable ownership of the former entitling him to the performance of certain duties and
the exercise of certain powers by the latter. What distinguishes a trust from other
relations is the separation of the legal title and equitable ownership of the property. In a
trust relation, legal title is vested in the fiduciary while equitable ownership is vested in
a cestui que trust.
There is a rule that a trustee cannot acquire by prescription the ownership of
property entrusted to him, or that an action to compel a trustee to convey property
registered in his name in trust for the benefit of the cestui que trust does not prescribe,
or that the defense of prescription cannot be set up in an action to recover property held
by a person in trust for the benefit of another, or that property held in trust can be
recovered by the beneficiary regardless of the lapse of time. This rule applies squarely
to express trusts. The basis of the rule is that the possession of a trustee is not adverse.
Not being adverse, he does not acquire by prescription the property held in trust.
The existence of express trusts concerning real property may not be established
by parol evidence. It must be proven by some writing or deed. Bare allegations do not
constitute evidence adequate to support a conclusion. They are not equivalent to proof
under the Rules of Court.
Although no particular words are required for the creation of an express trust, a
clear intention to create a trust must be shown; and the proof of fiduciary relationship
must be clear and convincing. The creation of an express trust must be manifested with
reasonable certainty and cannot be inferred from loose and vague declarations or from
ambiguous circumstances susceptible of other interpretations.
Heirs of Maximo Labanon v. Heirs of Constancio Labanon
G.R. No. 160711
August 14, 2007
Art. 1444, NCC: No particular words are required for the creation of an express trust, it
No particular form of words or conduct is necessary for the manifestation of
intention to create a trust. It is possible to create a trust without using the word trust or
trustee. Conversely, the mere fact that these words are used does not necessarily
indicate an intention to create a trust. The question in each case is whether the trustor
manifested an intention to create the kind of relationship which to lawyers is known as
trust. It is immaterial whether or not he knows that the relationship which he intends to
create is called a trust, and whether or not he knows the precise characteristics of the
relationship which is called a trust.
18 | P a g e
Gilbert G. Guy v. Court of Appeals

G.R. No. 165849
December 10, 2007
the beneficiary.
Trust, in its technical sense, is "a right of property, real or personal, held by one
party for the benefit of another." Differently stated, a trust is "a fiduciary relationship with
respect to property, subjecting the person holding the same to the obligation of dealing
with the property for the benefit of another person.
ERLINDA PILAPIL and HEIRS OF DONATA ORTIZ BRIONES, namely: ESTELA,
ERIBERTO AND VIRGILIO SANTOS, ANA SANTOS CULTURA, ELVIRA SANTOS
INOCENTES, ERNESTO MENDOZA, RIZALINA SANTOS, ADOLFO MENDOZA and
PACITA MENDOZA, v. HEIRS OF MAXIMINO R. BRIONES, namely: SILVERIO S.
BRIONES, PETRA BRIONES, BONIFACIO CABAHUG, JR., ANITA TRASMONTE,
CIRILITA FORTUNA, CRESENCIA BRIONES, FUGURACION MEDALLE and
MERCEDES LAGBAS,
G.R. No. 150175
February 5, 2007
Art. 1456
Doctrine:As this Court declared in its Decision, the existence of any trust relations
between petitioners and respondents shall be examined in the light of Article 1456 of the
New Civil Code, which provides that, [i]f 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. Hence, the foremost question to
be answered is still whether an implied trust under Article 1456 of the New Civil Code
had been sufficiently established in the present case.
In the Decision, this Court ruled in the negative, since there was insufficient evidence to
establish that Donata committed fraud. It should be remembered that Donata was able
to secure certificates of title to the disputed properties by virtue of the CFI Order in
Special Proceedings No. 928-R (the proceedings she instituted to
settle Maximinos intestate estate), which declared her as Maximinos sole heir. In the
absence of proof to the contrary, the Court accorded to Special Proceedings No. 928-R
the presumptions of regularity and validity.
19 | P a g e
ANITA UNGAB-VALEROSO, joined in by her husband, RUSELO VALEROSO, v.

AMANCIA UNGAB-GRADO, FELIX UNGAB, represented by his son ROSENDO
UNGAB, ESPENILA UNGAB-JAICTIN and RUSTICINA UNGAB-TAMALA
G.R. No. 163081
June 15, 2007
Art. 1444
Doctrine: As properly held by the trial and appellate courts, the execution of the
Affidavit of Acknowledgment and the compromise agreement established an express
trust wherein the respondents, as trustors, reposed their confidence on petitioner Anita
and her mother, as trustees, that they will hold the land subject of the coownership. There are no particular words required in the creation of an express trust, it
being sufficient that a trust is clearly intended.[16] This express trust is shown in the two
documents. Express trusts do not prescribe except when the trustee repudiates the
trust.
EULOGIO M. PEDRANO, v. HEIRS OF BENEDICTO PEDRANO, namely: ROMANA
PEDRANO, ANTONIO PEDRANO, ROSENDA PEDRANO RAAGAS, LEONIDA
PEDRANO VILLAMOR, and ZENAIDA P. DAGOHOY; and HEIRS OF NORBERTO M.
PEDRANO, namely: NORBERTO C. PEDRANO, JR., MARILYN C. PEDRANO, and
BENEDICTO C. PEDRANO, represented by NORMIE P. ALCORIN,
G.R. No. 159666
December 4, 2007
Art. 1456
Doctrine: Petitioner had not adduced evidence that he indeed paid the PhP 30,000
consideration for Lot. Since petitioner failed to comply with what is incumbent upon him,
the injured parties (respondents as heirs of Romana) may choose between fulfillment
and rescission of the sale under Art. 1191 of the Civil Code. Respondents chose
rescission. Thus, the juridical tie between the parties is invalidated and it leaves the
parties with their respective property rights relating to Lot No. 6416 before the
celebration of the December 22, 1981 Deed of Sale.
What remains therefore is the undisputed March 15, 1965 Deed of Sale with
Romana as the buyer. Petitioners possession of Lot No. 6416, owned by his parents,
was an implied trust constituted upon petitioner. The CA is correct in applying Art. 1456
on implied trust to this case.
Art. 1456 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.
20 | P a g e
CYNTHIA CRUZ KHEMANI and SHANKER N. KHEMANI, v. THE HEIRS OF

ANASTACIO TRINIDAD, represented by NAPOLEON and ROLANDO TRINIDAD
G.R. No. 147340
December 13, 2007
Doctrine:
Even assuming arguendo that respondents filed their action after one year, they may
still be entitled to relief. An aggrieved party may file an action for reconveyance based
on implied or constructive trust, which prescribes in ten years from the date of the
issuance of the certificate of title over the property provided that the property has not
been acquired by an innocent purchaser for value.
21 | P a g e

SPOUSES SOFRONIO SANTOS and NATIVIDAD SANTOS, FROILAN SANTOS,
CECILIA M. MACASPAC, and R TRANSPORT CORPORATION vs. HEIRS OF
DOMINGA LUSTRE, namely TARCISIO MANIQUIZ, TERESITA BURGOS, FLORITA
M. REYES and LERMIE MANIQUIZ|||
G.R. No. 151016
August 6, 2008
A person acquiring property through fraud becomes, by operation of law, a trustee of an
implied trust for the benefit of the real owner of the property. An action for reconveyance
based on an implied trust prescribes in ten years. And in such case, the prescriptive
period applies only if there is an actual need to reconvey the property as when the
plaintiff is not in possession of the property. Otherwise, if plaintiff is in possession of the
property, prescription does not commence to run against him. Thus, when an action for
reconveyance is nonetheless filed, it would be in the nature of a suit for quieting of title,
an action that is imprescriptible.
IRENE MARCOS-ARANETA, DANIEL RUBIO, ORLANDO G. RESLIN, and JOSE G.
RESLIN vs. COURT OF APPEALS, JULITA C. BENEDICTO, and FRANCISCA
BENEDICTO-PAULINO|||
G.R. No. 154096
August 22, 2008
Sec. 3, Rule 3 of the Rules of Court Parties to Civil Action
Representatives as parties. Where the action is allowed to be prosecuted or
defended by a representative or someone acting in a fiduciary capacity, the beneficiary
shall be included in the title of the case and shall be deemed to be the real party in
interest. A representative may be a trustee of an express trust, a guardian, an executor
or administrator, or a party authorized by law or these Rules. An agent acting in his own
name and for the benefit of an undisclosed principal may sue or be sued without joining
the principal except when the contract involves things belonging to the principal.
The trustee may be accorded the right to prosecute a suit, but only on behalf of the
beneficiary who must be included in the title of the case and shall be deemed to be the
real party-in-interest.
HEIRS OF GORGONIO MEDINA, namely: LEONOR T. MEDINA, RAMON T. MEDINA,
ABIEL T. MEDINA, ILUDIVINA M. ROSARI, CONCEPCION DE LA CRUZ, LEONOR
M. BAKKER, SAMUEL T. MEDINA, VICTOR T. MEDINA, TERESITA M. SABADO,
JOSEFINA M. CANAS and VERONICA M. DE GUZMAN vs. BONIFACIO NATIVIDAD,
represented by PHILIP M. NATIVIDAD
G.R. No. 177505
November 27, 2008
Section 24, Rule 132 of the Rules of Court.|
22 | P a g e
Proof of official record. The record of public documents referred to in paragraph (a) of
Section 19, when admissible for any purpose, may be evidenced by an official
publication thereof or by a copy attested by the officer having the legal custody of the
record, or by his deputy, and accompanied, if the record is not kept in the Philippines,
with a certificate that such officer has the custody. If the office in which the record is kept
is in a foreign country, the certificate may be made by a secretary of the embassy or
legation, consul general, consul, vice consul, or consular agent or by any officer in the
foreign service of the Philippines stationed in the foreign country in which the record is
kept, and authenticated by the seal of his office.
The rule on the prescriptive period of trustee repudiating the trust within 10 years||is not
applicable. When the special power of attorney is executed and acknowledged before a
notary public or other competent official in a foreign country, it cannot be admitted in
evidence unless it is certified as such in accordance with the foregoing provision of the
rules by a secretary of embassy or legation, consul general, consul, vice consul, or
consular agent or by any officer in the foreign service of the Philippines stationed in the
foreign country in which the record is kept of said public document and authenticated by
the seal of his office. Hence, a person has no legal capacity and not a real party-ininterest if the special power of attorney is not properly authenticated before a consular
office.
NATIVIDAD BAUTISTA-BORJA vs. ILUMINADA BAUTISTA, AUREA BAUTISTARUIZ, CLARITA BAUTISTA, FLORENTINO BAUTISTA, DIOSDADO BAUTISTA,
FRANCISCO BAUTISTA II, FRANCISCO BAUTISTA III, DANILO BAUTISTA,
LUZVIMINDA BAUTISTA, ARTURO BAUTISTA, LUZ BAUTISTA and PAULINO
BAUTISTA
G.R. No. 136197
December 10, 2008
force of law, considered as a trustee of an implied trust for the benefit of the person from
An action to compel the trustee to convey the property registered in his name for the
benefit of the cestui que trust does not prescribe"; and that the prescriptive period
commences to run only when the trustee repudiates the trust through unequivocal acts
made known to the cestui que trust. Thus, if the trial court finds that the deed of sale is
void, then the action for the declaration of the contract's nullity is imprescriptible.
23 | P a g e
MARY ANN DEHEZA-INAMARGA vs. CELENIA C. ALANO, BERNALDA A.

PAROHINOG, GODOFREDO ALANO, AVELINO ALANO, ESTRELLA ALANO,
FORTUNATA ALANO, NANY ALANO, SALLY ALANO, ADIONITO ALANO, and
SUFRONIA ALANO||
G.R. No. 171321
December 18, 2008
ART. 1410. The action or defense for the declaration of the inexistence of a contract
does not prescribe.
The argument that the prescriptive period for reconveyance of land based on implied
or constructive trust is 10 years cannot apply where there is no consent given by one
party in a purported contract, such contract was not perfected; therefore, there is no
contract to speak of. The deed of sale relied upon by petitioner is deemed a void
contract.
Lopez vs. CA 574 SCRA 26
GR. NO. 157784
December 16,2008
When the properties that are intended to be part of a trust fund were registered in the
name of the administrator of such trust fund, the possession of the administrator is that
of a trustee in an implied trust.
Ty vs. Ty
553 SCRA 306
GR. NO. 165696
April 30,2008
Art. 1448
When the father paid the price of a land, but it was registered under the sons name,
there is no express trust because there is no writing to prove it, nor can there be an
implied trust for the title to the land was conveyed to the son, thus a donation is
presumed.
Ting Ho, jr. vs. Teng Gui
558 SCRA 421
GR. NO. 130115
July 16,2008
The prohibition against an alien owning land of the public domain is absolute and not
even an implied trust can be permitted to arise on equity considerations.
24 | P a g e
Pasio vs. Monterroyo

560 SCRA 739
GR. NO. 159494
July 31, 2008
Under the principle of constructive trust, registration of property by one person in his
name, whether by mistake or fraud, the real owner being another person, impresses
upon the title so acquired the character of a constructive trust for the real owner, which
would justify an action for reconveyance.
Heirs of Nala vs. Cabansag
GR. NO. 161188
June 13, 2008
When the property under trust is sold to a buyer, the sending of demand letters for
rentals and evacuation is not indicative of bad faith or malice to support payment of
damages under article 19 of the New Civil Code.
25 | P a g e

Guaranteed Homes, Inc. vs. Heirs of Maria P. Valdez,
G.R. No. 171531
January 30, 2009
The other heirs of Pablo should have filed an action for reconveyance based on implied
or constructive trust within ten (10) years from the date of registration of the deed or the
date of the issuance of the certificate of title over the property. The legal relationship
between Cipriano and the other heirs of Pablo is governed by Article 1456 of the Civil
Code which provides that if a 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.
Heirs of Toribio Waga vs. Sacabin,
G.R. No. 159131
July 27, 2009
An action for reconveyance of property based on an implied or constructive trust is the
proper remedy of an aggrieved party whose property had been erroneously registered
in anothers name. The prescriptive period for the reconveyance of registered property
is ten years, reckoned from the date of the issuance of the certificate of title. However,
the ten-year prescriptive period for an action for reconveyance is not applicable where
the complainant is in possession of the land to be reconveyed and the registered owner
was never in possession of the disputed property. In such a case, the action for
reconveyance filed by the complainant who is in possession of the disputed property
would be in the nature of an action to quiet title which is imprescriptible.
Cavile vs. Litania-Hong,
581 SCRA 408
March 13, 2009
An aggrieved party may still file an action for reconveyance based on implied or
constructive trust, which prescribes in 10 years from the date of the issuance of the
Certificate of Title over the property, provided that the property has not been acquired by
an innocent purchaser for value. An action for reconveyance is one that seeks to
transfer property, wrongfully or fraudulently registered by another, to its rightful and legal
owner. If the registered owner, be he the patentee or his successor-in-interest to whom
the free patent was transferred, knew that the parcel of land described in the patent and
in the Torrens title belonged to another, who together with his predecessors-in-interest
had been in possession thereof, and if the patentee and his successor-in-interest were
never in possession thereof, the true owner may bring an action to have the ownership
of or title to the land judicially settled. The court in the exercise of its equity jurisdiction,
without ordering the cancellation of the Torrens titled issued upon the patent, may direct
26 | P a g e
the defendant, the registered owner, to reconvey the parcel of land to the plaintiff who
has been found to be the true owner thereof.
LINA PENALBER vs. QUIRINO RAMOS, LETICIA PENALBER and BARTEX, INC.
G.R. No. 178645
January 30, 2009
Article 1440- A person who establishes a trust is called the trustor; one in whom
the beneficiary.
There is a fiduciary relationship between the trustee and the beneficiary as regards
certain property, real or personal, money or choices in action. However, in relation to
Express Trust, it being sufficient that a trust has been clearly intended, if it concerns an
immovable property or any interest therein, the same may not be proved by parol or oral
evidence.
The Supreme Court held that Trust, in its technical legal sense that it is the right,
enforceable in its equity, to the beneficial employment of property, the legal title which is
vested with another, but the word trust is frequently employed to indicate duties,
relations, and responsibilities which are not strictly technical trusts.
HEIRS OF TRANQUILINO LABISTE vs. HEIRS OF JOSE LABISTE
G.R. No. 162033
May 8, 2009
Article 1444- No particular words are required for the creation of an express trust, it
Trust relations between parties may either be express or implied. An express trust is
created by the intention of the trustor or of the parties. Express Trusts are created by
direct and positive acts of the parties, by some writing or deed, or will, by words, either
expressly or impliedly evidencing an intention to create a trust.
Under Article 1444, no particular words are required for the creation of an express trust,
it being sufficient that a trust has been intended. As such, prescription and laches will
run only from the time the express trust has been repudiated.
ANGEL M. PAGADUAN et al. vs. SPOUSES ESTANISLAO and FE POSADAS
OCUMA
G.R. No. 176308
May 8, 2009
Article 1456- If property is acquired through mistake or fraud, the person obtaining it is,
by force of law, considered as trustee of an implied trust for the benefit of the person
The Supreme Court reiterated that Article 1456 refers to actual or constructive fraud.
Actual fraud consists in deception, intentionally practice to induce another to part with
property or to surrender some legal right and which accomplishes the end desired.
27 | P a g e
Constructive Fraud, on the other hand, is a breach of legal or equitable duty which the
law declares as fraudulent irrespective of the moral guilt of the actor due to the
tendency to deceive others, to violate private or public confidence, or to injure public
interests. The latter proceeds from a breach of duty arising out of a fiduciary or
confidential relationship. If there is no fiduciary relationship against the parties, there
can be no existence of constructive fraud.
JOSEPH REMENTIZO vs. HEIRS OF PELAGIA Vda. De MADARIETA
G.R. No. 170138
January 15, 2009
Article 1456- If property is acquired through mistake or fraud, the person obtaining it is,
by force of law, considered as trustee of an implied trust for the benefit of the person
The Supreme Court ruled that under Article 1456 of the New Civil Code, just as that
implied or constructive trust is an offspring of the law, so is the corresponding obligation
to reconvey the property and the title thereto in favor of the true owner. In this context,
and vis--vis prescription, the Civil Code provisions on prescription shall also be held
applicable. Thus, the 10-year prescriptive period is reckoned from the date of the
issuance of the certificate of title of the property involved. An action for reconveyance
based on implied or constructive trust prescribes in 10 years from the issuance of the
Torrens title of the said property, which operates as a constructive notice to the whole
world.
STRATEGIC ALLIANCE DEVELOPMENT CORPORATION vs. RADSTOCK
SEC U R ITIES LIMITED a nd PH ILIPPIN E N ATION A L C ON STR U C TION
CORPORATION
G.R. No. 178158
December 4, 2009
Article 1441- Trusts are either express or implied. Express trusts are created by the
intention of the trustor or the parties. Implied trusts come into being by operation of law.
A Compromise Agreement will not create a Trust relationship. Trust is the legal
relationship between one person having an equitable ownership in property and another
person owing the legal title to such property, the equitable ownership of the former
entitling him to the performance of certain duties and the exercise of powers by the
latter. Trust relations between parties are either express or implied. Express trust are
created by the direct and positive acts of the parties, by some writing, deed or will but a
compromise agreement would not vest any equitable ownership over the property.
28 | P a g e

SPS. FELIPE and JOSEFA PARINGIT, Petitioner, vs. MARCIANA PARINGIT BAJIT,
ADOLIO PARINGIT and ROSARIO PARINGIT ORDOO, Respondents.
G.R. No. 181844
September 29, 2010
Art. 1144. The following actions must be brought within ten years from the time the right
of action accrues: (1) Upon a written contract; (2) Upon an obligation created by law; or
(3) Upon a judgment.
An implied trust prescribes within 10 years from the time the right of action accrues. A
right of action implies the existence of a cause of action and a cause of action has three
elements: a) the existence of a right in plaintiffs favor; b) defendants obligation to
respect such right; and c) defendants act or omission that violates the plaintiffs right.
Only when the last element occurs or takes place can it be said in law that a cause of
action has arisen. In an implied trust, the beneficiarys cause of action arises when the
trustee repudiates the trust, not when the trust was created.
JUANITO GERONIMO, ANTONIA LIMSON and LINDA GERONIMO, vs. THE HEIRS
OF CARLITO GERONIMO represented by ANGELITO GERONIMO, Respondents.
G.R. No. 169858
January 26, 2010
Sec. 53 (3), PD 1529, In all cases of registration procured by fraud, the owner may
pursue all his legal and equitable remedies against the parties to such fraud without
prejudice, however, to the rights of any innocent holder of the decree of registration on
the original petition or application.
An action for reconveyance based on an implied or constructive trust prescribes in ten
years from the issuance of the Torrens title over the property. The law thereby creates
the obligation of the trustee to reconvey the property and the title thereto in favor of the
true owner. Correlating Section 53, paragraph 3 of Presidential Decree No. 1529 and
Article 1456 of the Civil Code with Article 1144(2) of the Civil Code, the prescriptive
period for the reconveyance of fraudulently registered real property is ten (10) years
reckoned from the date of the issuance of the certificate of title. In this case, the
reckoning period has not yet expired.
29 | P a g e
MIGUEL J. OSSORIO PENSION FOUNDATION, INCORPORATED, Petitioner, vs.

COURT OF APPEALS and COMMISSIONER OF INTERNAL
REVENUE, Respondents.
G.R. No. 162175
June 28, 2010
Art. 1450. If the price of a sale of property is loaned or paid by one person for the
benefit of another and the conveyance is made to the lender or payor to secure the
An implied trust arises where a person purchases land with his own money and takes
conveyance thereof in the name of another. In such a case, the property is held on
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 a contract or an agreement of the parties, but from
the facts and circumstances; that is to say, the trust results because of equity and it
arises by implication or operation of law. n this case, the notarized Memorandum of
Agreement and the certified true copies of the Portfolio Mix Analysis prepared by
Citytrust clearly prove that petitioner invested a certain amount, using funds of the
Employees' Trust Fund, to purchase the MBP lot. Since the MBP lot was registered in
VMCs name only, a resulting trust is created by operation of law. A resulting trust is
based on the equitable doctrine that valuable consideration and not legal title
determines the equitable interest and is presumed to have been contemplated by the
parties.Based on this resulting trust, the Employees Trust Fund is considered the
beneficial co-owner of the MBP lot.
FEDERICO JARANTILLA, JR., Petitioner,
vs. ANTONIETA JARANTILLA,
BUENAVENTURA REMOTIGUE, substituted by CYNTHIA REMOTIGUE, DOROTEO
JARANTILLA and TOMAS JARANTILLA, Respondents.
G.R. No. 154486
December 1, 2010
Art. 1457. An implied trust may be proved by oral evidence.
Express trusts are created by the intention of the trustor or of the parties, while implied
trusts come into being by operation of law, either through implication of an intention to
create a trust as a matter of law or through the imposition of the trust irrespective of,
and even contrary to, any such intention. In turn, implied trusts are either resulting or
constructive trusts. Resulting trusts are based on the equitable doctrine that valuable
consideration and not legal title determines the equitable title or interest and are
presumed always to have been contemplated by the parties. They arise from the nature
or circumstances of the consideration involved in a transaction whereby one person
thereby becomes invested with legal title but is obligated in equity to hold his legal title
for the benefit of another.
30 | P a g e
On proving the existence of a trust, this Court held that: "As a rule, the burden of
proving the existence of a trust is on the party asserting its existence, and such proof
must be clear and satisfactorily show the existence of the trust and its elements. While
implied trusts may be proved by oral evidence, the evidence must be trustworthy and
received by the courts with extreme caution, and should not be made to rest on loose,
equivocal or indefinite declarations. Trustworthy evidence is required because oral
evidence can easily be fabricated." In this case, respondent has presented only bare
assertions that a trust was created. Noting the need to prove the existence of a trust.
HEIRS OF DOMINGO VALIENTES, Petitioners, vs. Hon. REINERIO (Abraham) B.
RAMAS, Acting Presiding Judge, RTC, Branch 29, 9th Judicial Region, San
Miguel, Zamboanga del Sur and Vilma V. Minor, Respondents.
G.R. No. 157852
December 15, 2010
An action for reconveyance of a parcel of land based on implied or constructive trust
prescribes in ten years, the point of reference being the date of registration of the deed
or the date of the issuance of the certificate of title over the property. But this rule
applies only when the plaintiff is not in possession of the property, since if a person
claiming to be the owner thereof is in actual possession of the property, the right to seek
reconveyance, which in effect seeks to quiet title to the property, does not prescribe. In
the case at bar, petitioners are not in possession of the subject property. If it were to be
considered as that of enforcing an implied trust, should have therefore been filed within
ten years from the issuance of TCT in 1969. The case was, however, filed on 1998
which was way beyond the prescriptive period.
HEIRS OF JOSE LIM, Represented by ELENITO LIM, Petitioners,
vs. JULIET VILLA LIM
G.R. No. 172690
March 3, 2010
Article 1769 of the Civil Code, which provides:
Art. 1769. In determining whether a partnership exists, these rules shall
apply:
(1) Except as provided by Article 1825, persons who are not partners as
to each other are not partners as to third persons;
31 | P a g e
(2) Co-ownership or co-possession does not of itself establish a

partnership, whether such co-owners or co-possessors do or do not
share any profits made by the use of the property;
(3) The sharing of gross returns does not of itself establish a partnership,
whether or not the persons sharing them have a joint or common right or
interest in any property from which the returns are derived;
(4) The receipt by a person of a share of the profits of a business is a
prima facie evidence that he is a partner in the business, but no such
inference shall be drawn if such profits were received in payment:
(a) As a debt by installments or otherwise;
(b) As wages of an employee or rent to a landlord;
(c) As an annuity to a widow or representative of a deceased
partner;
(d) As interest on a loan, though the amount of payment vary with
the profits of the business;
(e) As the consideration for the sale of a goodwill of a business or
other property by installments or otherwise.
A partnership exists when two or more persons agree to place their money, effects,
labor, and skill in lawful commerce or business, with the understanding that there shall
be a proportionate sharing of the profits and losses among them. A contract of
partnership is defined by the Civil Code as one where two or more persons bind
themselves to contribute money, property, or industry to a common fund, with the
intention of dividing the profits among themselves.
MARSMAN DRYSDALE LAND, INC., v. PHILIPPINE GEOANALYTICS INC. AND
GOTESCO PROPERTIES INC.,
GOTESCO PROPERTIES INC., v. MARSMAN DRYSSDALE LAND, INC. AND
PHILIPPINE GEOANALYTICS, INC.,
G.R. Nos. 183374-183376
June 29, 2010
Article 1797 of the Civil Code provides:
Art. 1797. The losses and profits shall be distributed in conformity
with the agreement. If only the share of each partner in the profits has
been agreed upon, the share of each in the losses shall be in the same
proportion.
In the absence of stipulation, the share of each in the profits and
losses shall be in proportion to what he may have contributed, but the
industrial partner shall not be liable for the losses. As for the profits, the
industrial partner shall receive such share as may be just and equitable
under the circumstances. If besides his services he has contributed
capital, he shall also receive a share in the profits in proportion to his
32 | P a g e
capital.
In the JVA, Marsman Drysdale and Gotesco agreed on a 50-50 ratio on the
proceeds of the project. They did not provide for the splitting of losses,
however. Applying the above-quoted provision of Article 1797 then, the same ratio
applies in splitting the P535,353.50 obligation-loss of the joint venture.
The appellate courts decision must be modified, however. Marsman Drysdale
and Gotesco being jointly liable, there is no need for Gotesco to reimburse Marsman
Drysdale for 50% of the aggregate sum due to PGI.
Allowing Marsman Drysdale to recover from Gotesco what it paid to PGI would
not only be contrary to the law on partnership on division of losses but would partake of
a clear case of unjust enrichment at Gotescos expense. The grant by the lower courts
of Marsman Drysdale cross-claim against Gotesco was thus erroneous.
J. TIOSEJO INVESTMENT CORP v. SPOUSES BENJAMIN and ELEANOR ANG
G.R. No. 174149
September 8, 2010
Article 1824. All Partners are solidarily liable with the partnership for everything
chargeable to the partnership under Articles 1822 and 1823.
xxx A joint venture is considered in this jurisdiction as a form of partnership and is,
accordingly, governed by the law of partnerships. Under Article 1824 of the Civil Code of
the Philippines, all partners are solidarily liable with the partnership for everything
chargeable to the partnership, including loss or injury caused to a third person or
penalties incurred due to any wrongful act or omission of any partner acting in the
ordinary course of the business of the partnership or with the authority of his copartners. Whether innocent or guilty, all the partners are solidarily liable with the
partnership itself.
BALGAMELO CABILING MA, FELIX CABILING MA, JR., and VALERIO CABILING
MA v. COMMISSIONER ALIPIO F. FERNANDEZ, JR., ASSOCIATE COMMISSIONER
ARTHEL B. CARONOGAN, ASSOCIATE COMMISSIONER JOSE DL. CABOCHAN,
ASSOCIATE COMMISSIONER TEODORO B. DELARMENTE AND ASSOCIATE
COMMISSIONER FRANKLIN Z. LITTAUA, in their capacities as Chairman and
Members of the Board of Commissioners (Bureau of Immigration), and MAT G.
CATRAL
G.R. No. 183133
July 26, 2010
ARTICLE 1772. Every contract of partnership having a capital of three thousand pesos
or more, in money or property, shall appear in a public instrument, which must be
recorded in the Office of the Securities and Exchange Commission.
In a contract of partnership, we said that the purpose of registration is to give notice to
third parties; that failure to register the contract does not affect the liability of the
partnership and of the partners to third persons; and that neither does such failure affect
33 | P a g e
the partnerships juridical personality. An unregistered contract of partnership is valid as

among the partners, so long as it has the essential requisites, because the main
purpose of registration is to give notice to third parties, and it can be assumed that the
members themselves knew of the contents of their contract. (Citing Angeles vs. The
Hon. Sec. of Justice and Felino Mercado; G.R. No. 142612, July 29, 2005)
ROGER V. NAVARRO v. HON. JOSE L. ESCOBIDO, Presiding Judge, RTC Branch
37, Promulgated: Cagayan, De Oro City, and KAREN T. GO, doing business under
the NOVEMBER 27, 2009 name KARGO ENTERPRISES
ARTICLE 1811. A partner is co-owner with his partners of specific partnership property.
The incidents of this co-ownership are such that:
(1) A partner, subject to the provisions of this Title and to any agreement between the
partners, has an equal right with his partners to possess specific partnership property
for partnership purposes; but he has no right to possess such property for any other
purpose without the consent of his partners;
(2) A partner's right in specific partnership property is not assignable except in
connection with the assignment of rights of all the partners in the same property;
(3) A partner's right in specific partnership property is not subject to attachment or
execution, except on a claim against the partnership. When partnership property is
attached for a partnership debt the partners, or any of them, or the representatives of a
deceased partner, cannot claim any right under the homestead or exemption laws;
(4) A partner's right in specific partnership property is not subject to legal support under
article 291.
In this connection, Article 1811 of the Civil Code provides that [a] partner is a co-owner
with the other partners of specific partnership property. Taken with the presumption of
the conjugal nature of the funds used to finance the four checks used to pay for
petitioners stock subscriptions, and with the presumption that the credits themselves are
part of conjugal funds, Article 1811 makes Quirino and Milagros de Guzman co-owners
of the alleged credit.
34 | P a g e

Aznar vs Philippine National Bank
GR No 172021
May 30,2011
Express trusts are intentionally created by the direct and positive acts of the settlor and
the trustor - by some writing, deed or will or oral declaration. It is not created necessarily
by some written words, but by the direct and positive acts of the parties. This is in
consonance with Article 1444 of the civil code. In other words the creation of an express
trust must be manifested with reasonable certainty and cannot be inferred from loose
and vague declarations
In the case at bar, no express trust existed. Careful scrutiny and plain and ordinary
meaning of the Minutes does not offer any indication that the parties intended Azar to
become beneficiaries under an express trust.
Estate of Cabacungan vs Laigo et al
GR No. 175073
August 15, 2011
Express or direct trusts are created by the direct and positive acts of the trustor or of the
parties however the creation of an express trust must be firmly shown; it cannot be
assumed from loose and vague declarations or circumstances capable of other
interpretations.
Art. 1444 No particular words are required for the creation of an express trust, it being
sufficient that a trust is clearly intended.
Torbela vs Spouses Rosario
GR No. 140528
December 7, 2011
Mere issuance of the certificate of title in the name of any person does not foreclose the
possibility that the real property may be under co-ownership with persons not named in
the certificate or that the registrant may only be a TRUSTEE or that other parties may
have acquired interest subsequent to the issuance of the certificate of title.
Under Article 1444 of the Civil Code, no particular words are required for the creation of
an express trust, it being sufficient that a trust is clearly intended. It is possible to create
a trust without using the word trust or trustee. The question is whether the trustor
manifested an intention to create the kind of relationship; it is immaterial whether or not
he knows that the relationship which he intends to create is called trust and whether he
knows the precise characteristics of the relationship which is called trust.
Art 1451 When land passes by succession to any person and he causes the legal title to
be put in the name of another, a trust is established by implication of law for the benefit
of the true owner.
35 | P a g e
Modesto Leoveras v. Casimero Valdez

G.R. No. 169985
June 15, 2011
The fact that Gregoria was able to secure a title in her name does not operate to vest
ownership upon her of the subject land. Registration of a piece of land under the
Torrens System does not create or vest title, because it is not a mode of acquiring
ownership. A certificate of title is merely an evidence of ownership or title over the
particular property described therein. It cannot be used to protect a usurper from the
true owner; nor can it be used as a shield for the commission of fraud; neither does it
permit one to enrich himself at the expense of others. Its issuance in favor of a
particular person does not foreclose the possibility that the real property may be coowned with persons not named in the certificate, or that it may be held in trust for
another person by the registered owner.
Furthermore, respondents argument that the overriding reason why Hortizuela chose to
file a complaint for reconveyance and recovery of possession was that she failed to
avail of the remedy provided under Section 38 of Act 496 within the prescribed period of
one (1) year, counted from the issuance of the patent by the government, is weak. As
was similarly held in Cervantes v. CA,7 with the land obtained by respondent Gregoria
through fraudulent machinations by means of which a free patent and a title were issued
in her name, she was deemed to have held it in trust for the benefit of Hortizuela who
was prejudiced by her actions. Article 1456 provides:
ARTICLE 1456. If property is acquired through mistake or fraud, the person obtaining it
from whom the property comes.
The remedy of reconveyance, based on Section 53 of P.D. No. 1529 and Article 1456,
prescribes in ten (10) years from the issuance of the Torrens title over the property.
ANUNCIACION VDA. DE OUANO, MARIO P. OUANO, LETICIA OUANO ARNAIZ,
and CIELO OUANO MARTINEZ v. THE REPUBLIC OF THEPHILIPPINES, THE
MACTAN-CEBU INTERNATIONAL AIRPORT AUTHORITY, and THE REGISTER OF
DEEDS FOR THE CITY OF CEBU
G.R. No. 168770
MACTAN-CEBUINTERNATIONAL AIRPORT AUTHORITY (MCIAA) v. RICARDO L.
INOCIAN, in his personal capacity and as Attorney-in-Fact of OLYMPIA E.
ESTEVES, EMILIA E. BACALLA, RESTITUTA E. MONTANA, and RAUL L. INOCIAN;
and ALETHA SUICO MAGAT, in her personal capacity and as Attorney-in-Fact of
PHILIP M. SUICO, DORIS S. DELA CRUZ, JAMES M. SUICO, EDWARD M. SUICO,
ROSELYN SUICO-LAWSIN, REX M. SUICO, KHARLA SUICO-GUTIERREZ, ALBERT
CHIONGBIAN, and JOHNNY CHAN
G.R. No. 168812
February 09, 2011
36 | P a g e
Providing added support to the Ouanos and the Inocians right to repurchase is what
in Heirs of Moreno was referred to as constructive trust, one that is akin to the implied
trust expressed in Art. 1454 of the Civil Coded the purpose of which is to prevent unjust
enrichment. In the case at bench, the Ouanos and the Inocians parted with their
respective lots in favor of the MCIAA, the latter obliging itself to use the realties for the
expansion of Lahug Airport; failing to keep its end of the bargain, MCIAA can be
compelled by the former landowners to reconvey the parcels of land to them, otherwise,
they would be denied the use of their properties upon a state of affairs that was not
conceived nor contemplated when the expropriation was authorized. In effect, the
government merely held the properties condemned in trust until the proposed public use
or purpose for which the lots were condemned was actually consummated by the
government. Since the government failed to perform the obligation that is the basis of
the transfer of the property, then the lot owners Ouanos and Inocians can demand the
reconveyance of their old properties after the payment of the condemnation price.
Constructive trusts are fictions of equity that courts use as devices to remedy any
situation in which the holder of the legal title, MCIAA in this case, may not, in good
conscience, retain the beneficial interest. We add, however, as in Heirs of Moreno, that
the party seeking the aid of equity the landowners in this instance, in establishing the
trust must himself do equity in a manner as the court may deem just and reasonable.
37 | P a g e

MARIA TORBELA, vs SPOUSES ANDRES T. ROSARIO and LENA DUQUEROSARIO and BANCO FILIPINO SAVINGS AND MORTGAGE BANK,
G.R. No. 140528
December 8 2012
Trust is the right to the beneficial enjoyment of property, the legal title to which is vested
in another. It is a fiduciary relationship that obliges the trustee to deal with the property
for the benefit of the beneficiary. Trust relations between parties may either be express
or implied. An express trust is created by the intention of the trustor or of the parties,
while an implied trust comes into being by operation of law.
Express trusts are created by direct and positive acts of the parties, by some writing or
deed, or will, or by words either expressly or impliedly evincing an intention to create a
trust. Under Article 1444 of the Civil Code, [n]o particular words are required for the
creation of an express trust, it being sufficient that a trust is clearly intended. It is
possible to create a trust without using the word trust or trustee. Conversely, the
mere fact that these words are used does not necessarily indicate an intention to create
a trust. The question in each case is whether the trustor manifested an intention to
create the kind of relationship which to lawyers is known as trust. It is immaterial
whether or not he knows that the relationship which he intends to create is called a
trust, and whether or not he knows the precise characteristics of the relationship which
is called a trust.
NANCY T. LORZANO vs JUAN TABAYAG, JR.
G.R. No. 189647
February 6, 2012
Reconveyance based on fraud and constructive trust. However, the foregoing rule is not
without an exception. A recognized exception is that situation where plaintiff-claimant
seeks direct reconveyance from defendant public land unlawfully and in breach of trust
titled by him, on the principle of enforcement of a constructive trust.
NANCY L. TY
G.R. No. 188302
June 27, 2012
An implied trust could not have been formed between the Bank and Tala as this Court
has held that "where the purchase is made in violation of an existing statute and in
evasion of its express provision, no trust can result in favor of the party who is guilty of
the fraud."
CELERINO E. MERCADO vs BELEN ESPINOCILLA AND FERDINAND
ESPINOCILLA
G.R. No. 184109
February 1, 2012
38 | P a g e
In a constructive trust, there is neither a promise nor any fiduciary relation to speak of
and the so-called trustee (Macario) neither accepts any trust nor intends holding the
property for the beneficiary (Salvacion, Aspren, Isabel). The relation of trustee and
cestui que trust does not in fact exist, and the holding of a constructive trust is for the
trustee himself, and therefore, at all times adverse.[21] Prescription may supervene
even if the trustee does not repudiate the relationship
Government Service Insurance System vs. Commission on Audit
G.R. No. 162372
September 11, 2012
Constructive trust is substantially an appropriate remedy against unjust enrichment. It is
raised by equity in respect of property, which has been acquired by fraud, or where
although acquired originally without fraud, it is against equity that it should be retained
by the person holding it.
Article 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
Celerino E. Mercado vs. Belen and Ferdinand Espinocilla
G.R. No. 184109
February 1, 2012
In a constructive trust, there is neither a promise nor any fiduciary relation to speak of
and the so-called trustee (Macario) neither accepts any trust nor intends holding the
property for the beneficiary (Salvacion, Aspren, Isabel). The relation of trustee and
cestui que trust does not in fact exist, and the holding of a constructive trust is for the
trustee himself, and therefore, at all times adverse. Prescription may supervene even if
the trustee does not repudiate the relationship.
Article 1453. When property is conveyed to a person in reliance upon his declared
intention to hold it for, or transfer it to another or the grantor, there is an implied trust in
favor of the person whose benefit is contemplated.
Nancy L. Ty vs. Banco Filipino Savings and Mortgage Bank
G.R. No. 188302
June 27, 2012
An implied trust could not have been formed between the Bank and Tala as this Court
has held that where the purchase is made in violation of an existing statute and in
evasion of its express provision, no trust can result in favor of the party who is guilty of
the fraud.
Clearly, the Bank was well aware of the limitations on its real estate holdings under the
39 | P a g e
General Banking Act and that its "warehousing agreement" with Tala was a scheme to
circumvent the limitation. Thus, the Bank opted not to put the agreement in writing and
call a spade a spade, but instead phrased its right to reconveyance of the subject
property at any time as a "first preference to buy" at the "same transfer price". This
agreement which the Bank claims to be an implied trust is contrary to law. Thus, while
we find the sale and lease of the subject property genuine and binding upon the parties,
we cannot enforce the implied trust even assuming the parties intended to create it. In
the words of the Court in the Ramos case, "the courts will not assist the payor in
achieving his improper purpose by enforcing a resultant trust for him in accordance with
the 'clean hands' doctrine." The Bank cannot thus demand reconveyance of the
property based on its alleged implied trust relationship with Tala.
Article 1456. If property is acquired through mistake or fraud, the person obtaining it is,
Napoleon D. Neri, et al. vs. Heirs of Hadji Yusop Uy and Julpha Uy
G.R. No. 194366
October 10, 2012
Consequently, spouses Uy or their substituted heirs became pro indiviso co-owners of
the homestead properties with Eutropia, Victoria and Douglas, who retained title to their
respective 1/16 shares. They were deemed to be holding the 3/16 shares of Eutropia,
Victoria and Douglas under an implied constructive trust for the latters benefit.
Article 1456 If a property is acquired through mistake or fraud, the person obtaining it is,
Belle Corporation vs. Erlindal De Leon, et al.
GR. No. 174669
September 19, 2012
To apply the 10-year prescriptive period, which would bar a beneficiarys action to
recover in an express trust, the repudiation of the trust must be proven by clear and
convincing evidence and made known to the beneficiary. The express trust disables the
trustee from acquiring for his own benefit the property committed to his management or
custody, at least while he does not openly repudiate the trust, and makes such
repudiation known to the beneficiary or cestui que trust.
Article 1444. No particular words are required for the creation of an express trust, it
40 | P a g e
Pacete vs Asotigue
G.R No. 188575
December 10 2012
Art. 1447: The enumeration of the following cases of implied trust does not exclude
others established by the general law of trust, but the limitation laid down in
article 1442 shall be applicable
Doctrine: it is incumbent upon the aggrieved party to show that he has a legal claim on
the property superior to that of the registered owner and that the property has not yet
passed to the hands of an innocent purchaser for value.
Neri vs Heirs of hadji yusop uy
G.R No. 194366
October 10, 2012
others established by the general law of trust, but the limitation laid down in
article 1442 shall be applicable.
Doctrine: The action to recover property held in trust prescribes after ten years from the
time the cause of action accrues, which is from the time of actual notice in case of
unregistered deed.
Nancy L. Ty vs Banco filipino savings and mortgage bank
G.R No. 188302
June 27, 2012
others established by the general law of trust, but the limitation laid down in article 1442
shall be applicable.
Doctrine: where the purchase is made in violation of an existing statute and in evasion
of its express provision, no trust can result in favor of the party guilty of fraud.
Mendiola vs Ventura
G.R No. 162372
September 11, 2012
Art. 1456: if the property is acquired through mistake or fraud, the person obtaining it is,
by force of law considered a trustee of an implied trust for th benifit of the person from
Doctrine: it is not a trust in the technical sense for in a typical trust, confidence is
reposed in one person who is named a trustee for the benefit of another who is called
41 | P a g e
the cestui que trust, respecting property which is held by the trustee for the benefit of
the cestui que trust. A constructive trust, unlike an express trust, does not emanate
from, or generate a fiduciary relation. While in an express trust, a beneficiary and a
trustee are linked by confidential or fiduciary relations, 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 benificary
[I]mplied 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
Lena Duque rosario vs banco filipino savings and mortage bank
G.R No. 140553
December 7 2011
Art. 1444 No particular words are required for the creation of an express trust, it being
sufficient that a trust is clearly intended
Doctrine: It is possible to create a trust without using the word trust or
trustee. Conversely, the mere fact that these words are used does not necessarily
indicate an intention to create a trust. The question in each case is whether the trustor
manifested an intention to create the kind of relationship which to lawyers is known as
trust. It is immaterial whether or not he knows that the relationship which he intends to
create is called a trust, and whether or not he knows the precise characteristics of the
relationship which is called a trust.
42 | P a g e

JOSEPH GOYANKO, JR., as administrator of the Estate of Joseph Goyanko, Sr.,
vs. UNITED COCONUT PLANTERS BANK, MANGO AVENUE BRANCH
G.R. No. 179096
February 06, 2013
Article 1444 No particular words are required for the creation of an express trust, it
The requisites for an express trust are as follows: Basically, these elements
include a competent trustor and trustee, an ascertainable trust res, and sufficiently
certain beneficiaries. xxx each of the above elements is required to be established, and,
if any one of them is missing, it is fatal to the trusts (sic). Furthermore, there must be a
present and complete disposition of the trust property, notwithstanding that the
enjoyment in the beneficiary will take place in the future. It is essential, too, that the
purpose be an active one to prevent trust from being executed into a legal estate or
interest, and one that is not in contravention of some prohibition of statute or rule of
public policy. There must also be some power of administration other than a mere duty
to perform a contract although the contract is for a thirdparty beneficiary. A declaration
of terms is essential, and these must be stated with reasonable certainty in order that
the trustee may administer, and that the court, if called upon so to do, may enforce, the
trust.
GERSIP ASSOCIATION, INC., LETICIA ALMAZAN, ANGELA NARVAEZ, MARIA B.
PINEDA, LETICIA DE MESA AND ALFREDO D. PINEDA vs. GOVERNMENT
INSURANCE SERVICE SYSTEM
G.R. No. 189827
October 16, 2013
Article 1440 A person who establishes a trust is called the trustor; one in whom
the beneficiary.
Trust is the legal relationship between one person having an equitable ownership
in property and another person owning the legal title to such property, the equitable
ownership of the former entitling him to the performance of certain duties and the
exercise of certain powers by the latter. A trust fund refers to money or property set
aside as a trust for the benefit of another and held by a trustee. Under the Civil Code,
trusts are classified as either express or implied. An express trust is created by the
intention of the trustor or of the parties, while an implied trust comes into being by
operation of law.
43 | P a g e
AQUILES RIOSA vs. TABACO LA SUERTE CORPORATION

G.R. No. 203786
October 23, 2013
Art. 1441. Trusts are either express or implied. Express trusts are created by the
intention of the trustor or of the parties. Implied trusts come into being by operation of
law.
It cited, as legal basis, Article 1330 of the Civil Code which provides that a
contract where the consent is given thru violence, intimidation, undue influence or fraud
is voidable. Inasmuch as the property was acquired thru fraud, the person who obtained
it by force of law was considered a trustee of an implied trust for the benefit of the
person from whom the property came.
CAROLINA (CARLINA) VDA. DE FIGURACION, HEIRS OF ELENA
FIGURACION-ANCHETA, namely: LEONCIO ANCHETA, JR., and ROMULO
ANCHETA, HEIRS OF HILARIA A. FIGURACION, namely: FELIPA FIGURACIONMANUEL, MARY FIGURACION-GINEZ, and EMILIA FIGURACION-GERILLA,
AND HEIRS OF QUINTIN FIGURACION
G.R. No. 151334
February 13, 2013
Article 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
A trustee who obtains a Torrens title over a property held in trust for him by
another cannot repudiate the trust by relying on the registration. The Torrens system
does not create or vest title. It only confirms and records title already existing and
vested. It does not protect a usurper from the true owner. The Torrens system was not
intended to foment betrayal in the performance of a trust. It does not permit one to
enrich himself at the expense of another. Where one does not have a rightful claim to
the property, the Torrens system of registration can confirm or record nothing. The
beneficiaries are entitled to enforce the trust, notwithstanding the irrevocability of the
Torrens title. The intended trust must be sustained.
BANCO FILIPINO SAVINGS AND MORTGAGE BANK vs. TALA REALTY SERVICES
CORPORATION, PEDRO B. AGUIRRE, REMEDIOS A. DUPASQUIER, PILAR D.
ONGKING, ELIZABETH H. PALMA, DOLLY W. LIM RUBENCITO M. DEL MUNDO,
ADD INTERNATIONAL SERVICES, INCORPORATED, and NANCY L. TY,
G.R. No. 158866
September 9, 2013
Art. 1441. Trusts are either express or implied. Express trusts are created by the
intention of the trustor or of the parties. Implied trusts come into being by operation of
law.
44 | P a g e
Where the purchase is made in violation of an existing statute and in evasion of

its express provision, no trust can result in favor of the party who is guilty of the fraud.
SPOUSES QUIRINO V. DELA CRUZ and GLORIA DELA CRUZ v Planters Product
Inc.
G.R. No. 158649
February 18, 2013
In all trust receipt transactions, both obligations on the part of the trustee exist in
the alternative the return of the proceeds of the sale or the return or recovery of the
goods, whether raw or processed.
When both parties enter into an agreement knowing that the return of the goods
subject of the trust receipt is not possible even without any fault on the part of the
trustee, it is not a trust receipt transaction penalized under Section 13 of P.D. 115; the
only obligation actually agreed upon by the parties would be the return of the proceeds
of the sale transaction. This transaction becomes a mere loan, where the borrower is
obligated to pay the bank the amount spent for the purchase of the goods.
ANTIPOLO INING (DECEASED), SURVIVED BY MANUEL VILLANUEVA, TEODORA
VILLANUEVA-FRANCISCO, CAMILO
FRANCISCO, ADOLFO FRANCISCO, LUCIMO FRANCISCO, JR., MILAGROS
FRANCISCO,* CELEDONIO FRANCISCO, HERMINIGILDO FRANCISCO; RAMON
TRESVALLES, ROBERTO TAJONERA, NATIVIDAD INING-IBEA (DECEASED)
SURVIVED BY EDILBERTO IBEA, JOSEFA IBEA, MARTHA IBEA, CARMEN IBEA,
AMPARO IBEA- FERNANDEZ, HENRY RUIZ, EUGENIO RUIZ AND PASTOR RUIZ;
DOLORES INING-RIMON (DECEASED) SURVIVED BY JESUS RIMON, CESARIA
RIMON GONZALES AND REMEDIOS RIMON CORDERO; AND PEDRO INING
(DECEASED) SURVIVED BY ELISA TAN INING (WIFE) AND PEDRO INING, JR.,
Petitioners v. LEONARDO R. VEGA, SUBSTITUTED BY LOURDES VEGA,
RESTONILO I. VEGA, CRISPULO M. VEGA, MILBUENA VEGA-RESTITUTO, AND
LENARD VEGA, Respondents.
GR No. 174727
August 12, 2013
Possession by a co-owner will not be presumed to be adverse to the other coowners but will be held to benefit all, and that a co-owner or co-heir is in possession of
an inheritance pro-indiviso for himself and in representation of his co-owners or co-heirs
if he administers or takes care of the rest thereof with the obligation to deliver the same
to his co-owners or co-heirs, as is the case of a depositary, lessee or trustee.
45 | P a g e
Philippine Deposit Insurance Corporation v Bureau of Internal Revenue

G.R. No. 172892
June 13, 2013
Tax Code of 1997 imposes a general duty on all receivers, trustees in
bankruptcy, and assignees, who operate and preserve the assets of a corporation,
regardless of the circumstances or the law by which they came to hold their positions, to
file the necessary returns on behalf of the corporation under their care.
Dr. Roger R. Posadas and Dr. Rolando P. Dayco v SandiganBayan and People of the
Philippines
G.R. Nos. 168951 and 169000
A trust fund may be utilized only for the specific purpose for which the trust was
created or the funds received.
Our Constitution stresses that a public office is a public trust and public officers
must at all times be accountable to the people, serve them with utmost responsibility,
integrity, loyalty, and efficiency, act with patriotism and justice, and lead modest lives.
These constitutionally enshrined principles, oft-repeated in our case law, are not mere
rhetorical flourishes or idealistic sentiments. They should be taken as working standards
by all in the public service.
trust fund which is defined by Presidential Decree No. 1445 as fund that
officially comes in the possession of an agency of the government or of a public officer
as trustee, agent or administrator, or that is received for the fulfillment of some
obligation.
Hur Tin Yang v People of the Philippnes
G.R. No. 195117
August 14, 2013
The fact that the entruster bank knew even before the execution of the trust
receipt agreements that the construction materials covered were never intended by the
entrustee for resale or for the manufacture of items to be sold is sufficient to prove that
the transaction was a simple loan and not a trust receipts transaction. When both
parties enter into an agreement knowing fully well that the return of the goods subject of
the trust receipt is not possible even without any fault on the part of the trustee, it is not
a trust receipt transaction penalized under Sec. 13 of PD 115 in relation to Art. 315, par.
1(b) of the RPC, as the only obligation actually agreed upon by the parties would be the
return of the proceeds of the sale transaction. This transaction becomes a mere loan,
where the borrower is obligated to pay the bank the amount spent for the purchase of
the goods.
Following the precept of the law, such transactions affect situations wherein the
entruster, who owns or holds absolute title or security interests over specified goods,
documents or instruments, releases the subject goods to the possession of the
46 | P a g e
entrustee. The release of such goods to the entrustee is conditioned upon his execution
and delivery to the entruster of a trust receipt wherein the former binds himself to hold
the specific goods, documents or instruments in trust for the entruster and to sell or
otherwise dispose of the goods, documents or instruments with the obligation to turn
over to the entruster the proceeds to the extent of the amount owing to the entruster or
the goods, documents or instruments themselves if they are unsold. x x x [T]he
entruster is entitled only to the proceeds derived from the sale of goods released under
a trust receipt to the entrustee.
Ricardo Chu, Jr. and DY Kok Eng vs MELANIA CAPARA.S and SPOUSES RUEL
and HERMENIGILDA PEREZ,
G.R. No. 175428
April 15,2013
We also see no trust, express or implied, created between the petitioners and the
spouses Perez over the subject property. A trust by operation of law is the right to the
beneficial enjoyment of a property whose legal title is vested in another.37 A trust
presumes the existence of a conflict involving one and the same property between two
parties, one having the rightful ownership and the other holding the legal title. There is
no trust created when the property owned by one party is separate and distinct from
that which has been registered in anothers name.
STAR TWO (SPV-AMC), INC., vs PAPER CITY CORPORATION OF THE
PHILIPPINES,
G.R. No. 169211
March 6, 2013
Contrary to the finding of the CA, the Extra-Judicial Foreclosure of Mortgage
includes the machineries and equipments of respondent. While captioned as a Petition
for Extra-Judicial Foreclosure of Real Estate Mortgage Under Act No. 3135 As
Amended, the averments state that the petition is based on x x x the Mortgage Trust
Indenture, the Deed of Amendment to the Mortgage Trust Indenture, the Second
Supplemental Indenture to the Mortgage Trust Indenture, and the Third Supplemental
Indenture to the Mortgage Trust Indenture (hereinafter collectively referred to as the
Indenture) duly notarized and entered as x x x.
GOLD KEYDEVELOPMENT CORPORATION vs
BANK
G.R. No. 166282
February 13, 2013
INTERNATIONAL EXCHANGE
Directors or trustees who wilfully and knowingly vote for or assent to patently unlawful
acts of the corporation or who are guilty of gross negligence or bad faith in directing the
affairs of the corporation or acquire any personal or pecuniary interest in conflict with
their duty as such directors or trustees shall be liable jointly and severally for all
47 | P a g e
damages resulting therefrom suffered by the corporation, its stockholders or members

and other persons. Solidary liability will then attach
to the directors, officers or
employees of the corporation in certain circumstances, such as: 1. When directors and
trustees or, in appropriate cases, the officers of a corporation: (a) vote for or assent to
patently unlawful acts of the corporation; (b) act in bad faith or with gross negligence in
directing the corporate affairs; and (c) are guilty of conflict of interest to the prejudice of
the corporation, its stockholders or members, and other persons;
The trustee of a corporation may continue to prosecute a case commenced by the
corporation within three years from its dissolution until rendition of the final judgment,
even if such judgment is rendered beyond the three-year period allowed by Section 122
of the Corporation Code. However, there is nothing in the said cases which allows an
already defunct corporation to initiate a suit after the lapse of the said three-year period.
On the contrary, the factual circumstances in the abovecited cases would show that the
corporations involved therein did not initiate any complaint after the lapse of the threeyear period. In fact, as stated above, the actions were already pending at the time that
they lost their corporate existence.
PHILIPPINE NATIONAL BANK vs HYDRO RESOURCES CONTRACTORS
CORPORATION
G.R. No. 167530
March 13, 2013
As trustee of the Republic of the Philippines, the APT also assumed the responsibility of
the Republic pursuant to the following provision of Section 2.02 of the respective deeds
of transfer executed by DBP and PNB in favor of the Republic:
SECTION 2. TRANSFER OF BANKS LIABILITIES
xxxx
2.02 With respect to the Banks liabilities which are contingent and those liabilities
where the Banks creditors consent to the transfer thereof is not obtained, said liabilities
shall remain in the books of the BANK with the GOVERNMENT funding the payment
thereof.
VITALIANO N. AGUIRRES II and FIDEL N. AGUIRRE vs
FQB+7, INC., NATHANIEL D. BOCOBO, PRISCILA BOCOBO and ANTONIO DE
VILLA
G.R. No. 170770
January 9, 2013
Jurisprudence has even recognized the boards authority to act as trustee for persons in
interest beyond the said three-year period.Thus, the determination of which group is the
bona fide or rightful board of the dissolved corporation will still provide practical relief to
the parties involved.
48 | P a g e

JOSE JUAN TONG, ET AL.
G.R. No. 196023
April 21, 2014
vs.
GO TIAT KUN, ET AL.
The principle of a resulting trust is based on the equitable doctrine that valuable
presumed always to have been contemplated by the parties. They arise from the nature
or circumstances of the consideration involved in a transaction whereby one person
thereby becomes invested with legal title but is obligated in equity to hold his legal title
for the benefit of another. On the other hand, a constructive trust, unlike an express
trust, does not emanate from, or generate a fiduciary relation. Constructive trusts are
created by the construction of equity in order to satisfy the demands of justice and
prevent unjust enrichment. They arise contrary to intention against one who, by fraud,
duress or abuse of confidence, obtains or holds the legal right to property which he
ought not, in equity and good conscience, to hold.
Article 1457
Intention although only presumed, implied or supposed by law from the nature of the
transaction or from the facts and circumstances accompanying the transaction,
particularly the source of the consideration is always an element of a resulting trust and
may be inferred from the acts or conduct of the parties rather than from direct
expression of conduct. Certainly, intent as an indispensable element is a matter that
necessarily lies in the evidence, that is, by evidence, even circumstantial, of statements
made by the parties at or before the time title passes. Because an implied trust is
neither dependent upon an express agreement nor required to be evidenced by writing,
Article 1457 of our Civil Code authorizes the admission of parol evidence to prove their
existence. Parol evidence that is required to establish the existence of an implied trust
necessarily has to be trustworthy and it cannot rest on loose, equivocal or indefinite
declarations.
IGLESIA FILIPINA INDEPENDIENTE
G.R. No. 179597
February 3, 2014
vs.
HEIRS of BERNARDINO TAEZA
Article 1456
A deeper analysis of Article 1456 reveals that it is not a trust in the technical sense for in
a typical trust, confidence is reposed in one person who is named a trustee for the
benefit of another who is called the cestui que trust, respecting property which is held by
the trustee for the benefit of the cestui que trust. A constructive trust, unlike an express
trust, does not emanate from, or generate a fiduciary relation. While in an express trust,
a beneficiary and a trustee are linked by confidential or fiduciary relations, 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. ( Aznar Brothers Realty Company v. Aying, citing Vda. de Esconde)
49 | P a g e
Implied trusts are either resulting or constructive trusts. These two are differentiated
from each other as follows:
Resulting trusts are based on the equitable doctrine that valuable consideration
and not legal title determines the equitable title or interest
and are presumed always
to have been contemplated by the parties. They
arise from the nature of
circumstances of the consideration involved in a
transaction whereby one person
thereby becomes invested with legal title
but is obligated in equity to hold his legal
title for the benefit of another.
On the other hand, constructive trusts are created by
the construction of equity in order to satisfy the demands of justice and prevent unjust
enrichment. They arise contrary to intention against one who, by fraud,
duress or
abuse of confidence, obtains or holds the legal right to property
which he ought not,
in equity and good conscience, to hold.
HEIRS OF VALENTIN BASBAS
G.R. No. 188773
September 10, 2014
vs.
RICARDO BASBAS
It has been held: "the rule that registration of real property under the Torrens System
has the effect of constructive notice to the whole world cannot be availed of when the
purpose of the action is to compel a trustee to convey the property registered in his
name for the benefit of the cestui que trust. In other words, the defense of prescription
cannotbe set up in an action to enforce a trust
DOLORES CAMPOS
G.R. No. 171286
June 2, 2014
vs.
DOMINADOR ORTEGA, SR. and JAMES SILOS
Under the principle of constructive trust, registration of property by one person in his
name, whether by mistake or fraud, the real owner being another person, impresses
upon the title so acquired the character of a constructive trust for the real owner, which
would justify an action for reconveyance. In the action for reconveyance, the decree of
registration is respected as incontrovertible but what is sought instead is the transfer of
the property wrongfully or erroneously registered in another's name to its rightful owner
or to one with a better right. If the registration of the land is fraudulent, the person in
whose name the land is registered holds it as a mere trustee, and the real owner is
entitled to file an action for reconveyance of the property.
An action for reconveyance resulting from fraud prescribes four years from the
discovery of the fraud, which is deemed to have taken place upon the issuance of the
certificate of title over the property, and if based on an implied or a constructive trust it
prescribes ten (10) years from the alleged fraudulent registration or date of issuance of
the certificate of title over the property.
However, an action for reconveyance based on implied or constructive trust is
imprescriptible if the plaintiff or the person enforcing the trust is in possession of the
property. In effect, the action for reconveyance is an action to quiet title to the property,
which does not prescribe.
50 | P a g e
HEIRS OF FRANCISCO I. NARVASA, SR. vs. EMILIANA, VICTORIANO

G.R. No. 182908
August 6, 2014
An implied trust arises, not from any presumed intention of the parties, but by operation
of law in order to satisfy the demands of justice and equity and to protect against unfair
dealing or downright fraud. The burden of proving the existence of a trust is on the party
asserting its existence, and such proof must be clear and satisfactorily show the
existence of the trust and its elements. While implied trusts may be proven by oral
evidence, the evidence must be trustworthy and received by the courts with extreme
caution, and should not be made to rest on loose, equivocal or indefinite declarations.
Trustworthy evidence is required because oral evidence can easily be fabricated.
ELIZA ZUNIGA-SANTOS vs. MARIA DIVINA GRACIA SANTOS-GRAN G.R.
No. 197380
October 8, 2014
To determine when the prescriptive period commenced in an action for reconveyance,
the plaintiffs possession of the disputed property is material. If there is an actual need
to reconvey the property as when the plaintiff is not in possession, the action for
reconveyance based on implied trust prescribes in ten (10) years, the reference point
being the date of registration of the deed or the issuance of the title. On the other hand,
if the real owner of the property remains in possession of the property, the prescriptive
period to recover title and possession of the property does not run against him and in
such case, the action
JOSEPHINE WEE, vs. FELICIDAD MARDO
G.R. No. 202414
June 4, 2014
A certificate of title is merely an evidence of ownership or title over the particular
property described therein. It cannot be used to protect a usurper from the true owner;
nor can it be used as a shield for the commission of fraud: neither does it permit one to
51 | P a g e
enrich himself at the expense of others. Its issuance in favor of a particular person does
not foreclose the possibility that the real property may be co-owned with persons not
named in the certificate, or that it may be held in trust for another person by the
registered owner.
RODOLFO V. FRANCISCO vs. EMILIANA M. ROJAS, and the legitimate heirs of
JOSE A. ROJAS, namely: JOSE FERDINAND M. ROJAS II, ROLANDO M. ROJAS,
JOSE M. ROJAS, JR., CARMELITA ROJAS-JOSE, VICTOR M. ROJAS, and
LOURDES M. ROJAS, all represented by JOSE FERDINAND M. ROJAS II
G.R. No. 167120
April 23, 2014
An action for reconveyance resulting from fraud prescribes four years from the
discovery of the fraud and if it is based on an implied or a constructive trust it prescribes
ten (10) years from the alleged fraudulent registration or date of issuance of the
certificate of title over the property. However, an action for reconveyance based on
implied or constructive trust is imprescriptible if the plaintiff or the person enforcing the
trust is in possession of the property.
PHILIPPINE COMMERCIAL INTERNATIONAL BANK (now BDO UNIBANK, INC.) vs.
ARTURO P. FRANCO, substituted by his heirs, namely: MAURICIA P. FRANCO,
FLORIBEL P. FRANCO, AND ALEXANDER P. FRANC0
G.R. No. 180069
March 5, 2014
A trust instrument states the termination of date of the trust or the event on which the
trustor wishes it to terminate. The claim is not yet barred by prescription, since the
maturity dates of the trust agreement did not terminate the express trust created
between the parties.
52 | P a g e

Clemente vs. Court of Appeals
GR No. 175483
October 14, 2015
There is no implied trust that can be generated by the simulated transfers because
being fictitious or simulated, the transfers were null and void ab initio from the very
beginning and thus vested no rights whatsoever in favor of petitioner.
CIR vs. Traders Royal Bank
GR No. 167134
March 18, 2015
Whether Trust Indenture Agreements constitutes deposits or trusts. The only way the
court can determine the actual relationship between TRB and its clients is through a
scrutiny of the terms and conditions embodied in the said Agreements. What does not
constitute a trust, other fiduciary and/or investment management relationship.
Toledo vs. Court of Appeals
GR No. 167838
August 5, 2015
Art. 1456 provides that a person acquiring property through fraud becomes, by
operation of law, a trustee of an implied trust for the benefit of the real owner of the
property. The presence of fraud in this case, despite knowledge of petitioners title over
the same, created an implied trust in favor of Toledo, et.al.
Dy Sun-Ong vs. Dy Sun
GR No. 207435
July 1, 2015
The alleged existence of an implied trust are questions of fact which must be remanded
to the lower court.
Home Guaranty Corporation vs. La Savoie Development Corporation
GR No. 168616
January 28, 2015
The registration of the disputed properties in the name of Jose was actually pursuant to
a court order. The apparent mistake in the adjudication of the disputed properties to
Jose created a mere implied trust.
53 | P a g e
WILSON GO and PETER GO V. THE ESTATE OF THE LATE FELISA TAMIO OF

BUENAVENTURA
GR. No. 211972
22 July 2015
BELLA A GUERERO V. THE ESTATE OF THE LATE FELISA TAMIO DE
BUENAVENTURA
GR. No. 212045
22 July 2015
Under Article 1444 of the Civil Code,"[n]o particular words are required for the creation
of an express trust, it being sufficient that a trust is clearly intended.|
Case Doctrine:
It is possible to create a trust without using the word "trust" or "trustee." Conversely, the
mere fact that these words are used does not necessarily indicate an intention to create
a trust. The question in each case is whether the trustor manifested an intention to
create the kind of relationship which to lawyers is known as trust. It is immaterial
whether or not he knows that the relationship which he intends to create is called a
trust, and whether or not he knows the precise characteristics of the relationship which
is called a trust.
HOME GUARANTY CORPORATION, petitioner, vs. LA SAVOIE DEVELOPMENT
CORPORATION
G.R. No. 168616
January 28, 2015
whom the property comes
Case Doctrine:
been contemplated by the parties. They arise from the nature or circumstances of the
54 | P a g e
SPOUSES ARMANDO and LORNA TRINIDAD, petitioners, vs. DONA * MARIE

GLENN IMSON
G.R. No. 197728
September 16, 2015
Art. 1448 of the Civil Code provides that "[t]here 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.
Case Doctrine:
As to whether or not an implied trust was created in respondent's favor, the first
sentence of Article 1448 of the Civil Code provides that "[t]here 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." This 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. 35 The principle of a resulting trust is based on the
equitable doctrine that valuable consideration, and not legal title, determines the
equitable title or interest and are presumed always to have been contemplated by the
parties. 36 They arise from the nature or circumstances of the consideration involved in
a transaction whereby one person thereby becomes invested with legal title but is
obligated in equity to hold his legal title for the benefit of another|||
Pangasinan v. Disonglo-Almazora
G.R. No. 200558
July 1, 2015
Article 1456 of the Civil Code provides that a person acquiring property through fraud
becomes, by operation of law, a trustee of an implied trust for the benefit of the real
owner of the property.
Case Doctrine:
It is now well-settled that the prescriptive period to recover property obtained by fraud or
mistake, giving rise to an implied trust under Article 1456 of the Civil Code,is 10 years
pursuant to Article 1144. The prescriptive period to enforce the constructive trust shall
be counted from the alleged fraudulent registration or date of issuance of the certificate
of title over the property. The ten-year prescriptive period applies only if there is an
actual need to reconvey the property as when the plaintiff is not in possession of the
property.
55 | P a g e
Philippine General Council of the Assemblies of God, Inc. v. Heirs of Morales

G.R. No. 144371
February 11, 2015
Article 1456. If the property is acquired through mistake or fraud, the person obtaining it
from whom the property comes.||| (Philippine General Council of the Assemblies of God,
Inc. v. Heirs of Morales, G.R. No. 144371 (Notice), [February 11, 2015])
Case Doctrine:
As can be gleaned from the foregoing allegations in the complaint, the plaintiffs seek to
recover the property through reconveyance (as the subject one hectare portion has
already been titled in the name of the defendant) based on implied trust.This is so
because, Article 1456 of the New Civil Code provides: "Article 1456. If the property is
acquired through mistake or fraud, the person obtaining it is, by force of law, considered
a trustee of an implied trust for the benefit of the person from whom the property comes.
Honorado v. CA
G.R. No. 204702
January 14, 2015
Doctrine: There arises no implied trust in a licensing contract unless the licensor mere
acted as agent of the film owners.
Clemente v. CA
G.R. No. 175483
October 14, 2015
Doctrine: No Implied Trust can be generated by the simulated transfers because such
transfers were void ab initio and this vested no rights in favour of petitioner. Void
contracts cannot be the source of an Implied Trust as no rights can arise from such a
contract.
Toledo v. CA
G.R. No. 167838
August 5, 2015
Doctrine: Art. 1456 provides that a person acquiring property through fraud becomes, by
operation of law, a trustee of an implied trust for the benefit of the real owner of the
property. The presence of fraud in this case, despite knowledge of petitioners title over
the same, created an implied trust in favor of Toledo, et.al.
56 | P a g e
Home Guaranty Corporation v. La Savoie

G.R. No. 168616
January 28, 2015
Doctrine: Resulting trusts are based on the equitable doctrine that valuable
presumed always to have been contemplated by the parties.
CIR v. Traders Bank
G.R. No. 167134
March 18, 2015
Doctrine: Whether Trust Indenture Agreements constitutes deposits or trusts, the only
way the court can determine the actual relationship between TRB and its clients is
through a scrutiny of the terms and conditions embodied in the said Agreements
57 | P a g e

ATP Jurisprudence From 2005-2015

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

ATP Jurisprudence From 2005-2015

Uploaded by

Copyright:

Available Formats

2005 Jurisprudence on Trusts

Sps. Gomez v. Duyan

Vda. De Rigonan v. Derecho

by operation of law as matters of equity, independently of the particular intention of the

PHILIPPINE NATIONAL BANK,Petitioner, - versus -MERELO B. AZNAR; MATIAS B.

2006 Jurisprudence on Trusts

consideration involved in a transaction whereby one person thereby becomes invested

parties. In turn, implied trusts are either resulting or constructive trusts.

2007 Jurisprudence on Trusts

A trust is the legal relationship between one person having an equitable

Gilbert G. Guy v. Court of Appeals

ANITA UNGAB-VALEROSO, joined in by her husband, RUSELO VALEROSO, v.

CYNTHIA CRUZ KHEMANI and SHANKER N. KHEMANI, v. THE HEIRS OF

2008 Jurisprudence on Trusts

MARY ANN DEHEZA-INAMARGA vs. CELENIA C. ALANO, BERNALDA A.

Pasio vs. Monterroyo

2009 Jurisprudence on Trusts

2010 Jurisprudence on Trusts

MIGUEL J. OSSORIO PENSION FOUNDATION, INCORPORATED, Petitioner, vs.

(2) Co-ownership or co-possession does not of itself establish a

the partnerships juridical personality. An unregistered contract of partnership is valid as

2011 Jurisprudence on Trusts

Modesto Leoveras v. Casimero Valdez

2012 Jurisprudence on Trusts

2013 Jurisprudence on Trusts

AQUILES RIOSA vs. TABACO LA SUERTE CORPORATION

Where the purchase is made in violation of an existing statute and in evasion of

Philippine Deposit Insurance Corporation v Bureau of Internal Revenue

damages resulting therefrom suffered by the corporation, its stockholders or members

2014 Jurisprudence on Trusts

GO TIAT KUN, ET AL.

HEIRS of BERNARDINO TAEZA

DOMINADOR ORTEGA, SR. and JAMES SILOS

HEIRS OF FRANCISCO I. NARVASA, SR. vs. EMILIANA, VICTORIANO

2015 Jurisprudence on Trusts

WILSON GO and PETER GO V. THE ESTATE OF THE LATE FELISA TAMIO OF

SPOUSES ARMANDO and LORNA TRINIDAD, petitioners, vs. DONA * MARIE

Philippine General Council of the Assemblies of God, Inc. v. Heirs of Morales

Home Guaranty Corporation v. La Savoie

You might also like