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G.R. No.

L-22587 April 28, 1969 Issue: W/N there is an implied or express trust
RUFINO BUENO, FILOMINO GURRERRO, et.al, plaintiffs-appellant, vs.
MATEO REYES, and JUAN REYES, defendants-appellees Held: There is an implied trust.
Topic: Trusts; express trusts; implied trusts 1. The alleged express trust was for Francisco Reyes to acquire the
title of the land by cadastral proceedings. But such trust failed to
Doctrine: Registration of property by one person in his name, whether by materialize because of his acts, with his brothers, of obtaining the
mistake or fraud, the real owner being another person, impresses upon such title in their own name.
title the character of a constructive trust for the real owner, which would 2. If there is even a trust, it is an implied one arising by operation of law
justify an action for reconveyance. to satisfy the demands of justice and equity. In this kind of implied
trust, commonly described as constructive, there exists opposition
Facts: (Authors note: There are a lot of names so if you get confused, refer between the cestui que1 trust and the trustee.
to family tree in the end notes) 3. For instance, under Article 1456 of the Civil Code, "if property is
1. Francisco Reyes (died before this action was decided) filed an acquired through mistake or fraud, the person obtaining it is, by
answer in a Cadastral Case, claiming the subject land belonging force of law, considered a trustee of an implied trust for the
to himself and his two brothers, Juan and Mateo. The case was benefit of the person from whom the property comes."
heard without opposition so the OCT was issued in their name. a. In a number of cases this Court has held that
2. Twenty-three years later, plaintiffs filed an action for registration of property by one person in his name,
reconveyance of the subject land. They alleged that: whether by mistake or fraud, the real owner being
a. The land originally belonged to Jorge Bueno and when he another person, impresses upon such title the character
died, the three children, Brigida, Eugenia and Rufino (Jorge of a constructive trust for the real owner, which would
heirs), owned the property due to succession. Brigida and justify an action for reconveyance.
Eugenia died, leaving their heirs, together with Rufino, as 4. Since such is an implied trust, it is subject to prescription in ten
plaintiffs. years.
b. Fransisco Reyes was married to Eugenia and the Jorge
heirs allegedly had an agreement with Francsisco in which Ruling of the Court
they entrusted such duty of obtaining the title of the land 1. However, the question here is from what time should the
in behalf of the Jorge heirs by cadastral proceedings. prescription run. Since the constructive trust only arose by the
c. Francisco, with his two brothers Juan and Mateo, allegedly discovery of bad faith registration of the land to Franciscos
obtained the title in bad faith, who connived in committing name, the cause of action must be deemed to accrue only upon
such malicious acts, knowing fully well that the land was this point.
never owned by them 2. Such cadastral proceedings, since it is an action in rem, was not a
3. Defendants Juan and Mateo raised a number of defenses, including constructive notice to plaintiffs since it was not adverse to them.
prescription. CFI ruled in favor of defendants. 3. Also, such allegations above were hypothetically admitted when
4. Hence, this case of appeal in which plaintiffs are arguing that the CFI defendants filed an a MTD. However, there are some matters that
erred in dismissing complaint based on prescription. must be substantiated in trial.
5. Defendants maintain that action for reconveyance was predicated on
the existence of an implied trusts, and that such action WHEREFORE, Order of CFI is SET ASIDE and case is REMANDED.
prescribes in 10 years. Basically, PLAINTIFFS WON!
6. Plaintiffs counter that the trust was express, and not implied (express
trust does not prescribe unless trustee repudiates the trust). Even if it
was implied, some jurisprudence states that an implied trust can be
imprescriptible.

1 Although legal title of the trust is vested in the trustee, the cestui que trust is
the beneficiary who is entitled to all benefits from a trust.
End Note: You can delete this diagram once you understand the case)

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