Portugal vs IAC (Portugal vs CA)

G.R. No. 73564 March 25, 1988

Doctrine: It is now settled that reconveyance of the parcel of land based on an
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
titIe over the property.
Facts: Sometime in January 1967, private respondent Hugo Portugal borrowed from
his mother certificates of title to parcel of lands owned by the latter and his
husband allegedly for securing a loan. In November of 1974, when the father died,
the other heirs of the deceased father wanted to have all the properties of their
parents collated, the mother asked respondent to return the two titles she
previously loaned. The titles no longer existed because of a deed of sale purportedly
made by the spouses to Hugo and his brother for P8,000 causing the conveyance of
the title in their name. Hence an action for annulment of the deed of sale and
reconveyance was filed.
Issue: Whether or not the action has prescribed
Ruling: No.
The case at bar is not purely an action for reconveyance based on an implied or
constructive trust. Neither is it one for the annullment of a fraudulent contract. A
closer scrutiny of the records of the case readily supports a finding that fraud and
mistake are not the only vices present in the assailed contract of sale as held by the
trial court. More than these, the alleged contract of sale is vitiated by the total
absence of a valid cause or consideration. The petitioners in their complaint, assert
that they, particularly Cornelia, never knew of the existence of the questioned deed
of sale. They claim that they came to know of the supposed sale only after the
private respondent, upon their repeated entreaties to produce and return the
owner's duplicate copy of the transfer certificate of title covering the two parcels of
land, showed to them the controversial deed. And their claim was immeasurably
bolstered when the private respondent's co-defendant below, his brother Emiliano
Portugal, who was allegedly his co-vendee in the transaction, disclaimed any
knowledge or participation therein. If this is so, and this is not contradicted by the
decisions of the courts below, the inevitable implication of the allegations is that
contrary to the recitals found in the assailed deed, no consideration was ever paid
at all by the private respondent. Applying the provisions of Articles 1350, 1352, and
1409 of the new Civil Code in relation to the indispensable requisite of a valid cause
or consideration in any contract, and what constitutes a void or inexistent contract,
we rule that the disputed deed of sale is void ab initio or inexistent, not merely
voidable. And it is provided in Article 1410 of the Civil Code, that '(T)he action or
defense for the declaration of the inexistence of a contract does not prescribe.
But even if the action of the petitioners is for reconveyance of the parcel of land
based on an implied or constructive trust, still it has been seasonably filed. For as
heretofore stated, it is now settled that actions of this nature prescribe 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 titIe over the property. In this case, the petitioner
commenced the instant action for reconveyance in the trial court on October 26,
1976, or less than ten years from January 23, 1967 when the deed of sale was
registered with the Register of Deeds. Clearly, even on this basis alone, the present
action has not yet prescribed.