Contents

G.R. No. 172849 - MR. TERESO TAN, ET AL. v. MANUEL "GUY" LINK, ET AL. ................................................ 1
ALFON v Republic G.R. No. L-51201 May 29, 1980 ..................................................................................... 11
People v. Nazario G.R. No. L-44143 August 31, 1988 ................................................................................. 14
Ching v. Goyanko G.R. No. 165879 November 10, 2006 ................................................................. 21
Matabuena v. Cervantes [G.R. No. L-28771. March 31, 1971.] .................................................................. 27
Melchor v. COA G.R. No. 95398 August 16, 1991 .............................................................. 30
Tomas v. Tomas G.R. No. L-36897 June 26, 1980 ............................................................................ 35
Vda. De Ape v. CA........................................................................................................................................ 38

G.R. No. 172849 - MR. TERESO TAN, ET AL. v. MANUEL "GUY" LINK, ET AL.

THIRD DIVISION

[G.R. NO. 172849 : December 10, 2008]

MR. TERESO TAN, ANDRE T. ALMOCERA, for themselves and in behelf of the First Builders
Multi-Purpose Cooperative (FBMPC), Petitioners, v. MANUEL "GUY" LINK, ATTY. ARNOLD
ARRIETA, ROSALIO T. KINTANAR, VIVIAN MAQUILING, LAND BANK OF THE PHILIPPINES (LBP),
CIRILO YURO AND REINERIO CABANGBANG, MANUEL BARTOLABA and the PROVINCIAL
REGISTER OF DEEDS of the PROVINCE OF CEBU, Respondents.

DECISION

CHICO-NAZARIO, J.:

This is an appeal by certiorari under Rule 45 of the 1997 Rules of Civil Procedure seeking the
reversal and setting aside of (1) the Decision1 dated 21 February 2006 of the Court of Appeals in
CA-G.R. SP No. 82957 dismissing the Petition for Certiorari under Rule 65 of herein petitioners
for their failure to pay docket fees on time, and affirming the Orders dated 26 September 2003
and 23 December 2003 of the Regional Trial Court (RTC) of Bogo, Cebu, Branch 61, in Civil Case
No. Bogo-00994; and (2) the Resolution2 dated 12 May 2006 of the appellate court in the same
case denying petitioners' Motion for Reconsideration.

The instant Petition arose from a complaint3 for "Action Reindivicatoria (sic),
Damages, Certiorari, Prohibition and Mandamus with Prayer for Writ of Preliminary Prohibitory
Injunction and Restraining Order" filed on 19 November 2002 by petitioners First Builders
Multi-Purpose Cooperative (FBMPC), Andre T. Almocera (Almocera), and Tereso C. Tan (Tan)
against respondents Manuel "Guy" Link (Link), Arnold Arrieta (Arrieta),4 Rosalio T. Kintanar
(Kintanar), Vivian Maquiling (Maquiling),5 Land Bank of the Philippines (LBP), Cirilo Yuro, Jr.
(Yuro), Reinerio Cabangbang (Cabangbang),6 Manuel Bartolaba (Bartolaba),7 and the Register of
Deeds of the Province of Cebu. Their complaint was docketed before the RTC as Civil Case No.
Bogo-00994.

Petitioners made the following allegations in their complaint:

Respondent Link sold his eight parcels of land situated in Barangays Anonang and Binanag,
Bogo, Cebu (subject properties), to petitioners FBMPC and Almocera, evidenced by a Deed of
Absolute Sale dated 2 April 2002.8 The certificates of title to the subject properties remained in
the name of respondent Link.

Unknown to petitioners, respondent Link had voluntarily offered the subject properties for sale
under the coverage of the Comprehensive Agrarian Reform Program (CARP) of Republic Act No.
6657 or the Comprehensive Agrarian Reform Law (CARL). In accordance with the provisions of
the CARL, the subject properties were valued by the Valuation Office of respondent Land Bank
of the Philippines (LBP) in order to determine the just compensation for the same. The Notice
of Valuation, stating the amounts at which the subject properties were valued and giving notice
that such amounts had already been deposited with the LBP Branch in P. del Rostio St., Cebu
City, was sent to respondent Link.

The subject properties were initially valued at around P2,000,000.00. Respondent Link,
purportedly in connivance with officers of the Cebu Provincial Office of the Department of
Agrarian Reform (DAR), who included respondent Bartolaba, filed with the Department of
Agrarian Reform Adjudication Board (DARAB) an application for valuation of the subject
properties. The petitions of respondent Link were docketed as DARAB Cases No. V11-1225-C-
1997 and No. V11-1220-C-96 and assigned to respondent Kintanar, a Provincial Agrarian Reform
Adjudicator.

Upon their discovery of the transgressions committed by Link, petitioners, through counsel,
wrote a letter dated 12 August 2001 addressed to respondent Kintanar of the DARAB; with copy
furnished respondent Yuro, an LBP officer. Petitioners claimed in their letter that the subject
properties had already been sold to them by respondent Link. They further requested that any
claim, request, or undertaking involving the subject properties by other individuals or entities
be set aside.

Acting on petitioners' letter dated 12 August 2001, which he treated as a motion for the
payment of just compensation, respondent Kintanar required the parties to file their respective
position papers. Based on the submitted position papers, respondent Kintanar subsequently
issued an Order dated 10 December 2001 denying for want of merit petitioners' letter/motion
for payment of just compensation for the subject properties, based on the following reasoning:

A careful calibration of the evidence adduced herein, the claim of FBMPC as the lawful and
absolute owner of the subject lots on the basis of an unregistered Deed of Sale dated April 2,
1995 is diametrically baseless, farfetched and preposterous for utter failure to register the said
sale and secure the necessary Certificate of Title in its name as prescribed by law. No amount of
rhetorical force could smokescreen the fatal flaw emanating from the defective sale as
provided for by laws heretofore indicated.

Besides, it is significant to note that the subject properties are within the pale of CARP Coverage
as enshrined under Republic Act 6657. CARP Law and these lots are purposely acquired by the
government and intended solely and exclusively for distribution to farmer-beneficiaries, not to
any private persons and/or associations like the FBMPC. x x x.9

Respondent Kintanar thus ordered:

WHEREFORE, premises considered, the Letter-Motion for Payment of Just Compensation over
the subject properties by FBMPC is hereby DENIED DUE COURSE for want of merit. Accordingly,
directing Land Bank Office, Cebu City to pay the just compensation to Mr. Manuel Link as
warranted by law and evidence adduced hereof. Further still, ordering the DAR Provincial Office
of Cebu through PARO Ma. Lourdes B. Mariano and CARPO Operations to properly note the
instant directive heretofore indicated.10

Petitioners filed a Motion for Reconsideration of respondent Kintanar's Order dated 10

December 2001. It was already respondent Arrieta, a Regional Agrarian Reform Adjudicator,
who acted on petitioners' Motion for Reconsideration and denied the same in an Order dated
21 March 2002.11

Respondent Kintanar issued an Order dated 20 August 2002 inhibiting himself from resolving
any further incident or motion in DARAB Cases No. V11-1225-C-1997 and No. V11-1220-C-96
and directing the DARAB Clerk of Court to immediately forward the records of the cases to
respondent Maquiling, another Provincial Agrarian Reform Adjudicator.

Despite the foregoing attempts of petitioners to preclude any other action on the pending
DARAB cases, petitioner Tan was informed by LBP officials that the release of funds to pay
respondent Link just compensation for the subject properties was already imminent unless a
restraining order or injunction would be issued by the regular courts.

Hence, petitioners instituted Civil Case No. Bogo-00994 before the RTC of Bogo, Cebu, Branch
61.

Respondent Link filed a Motion to Dismiss Civil Case No. Bogo-00994 on the following grounds:

A) The Honorable Court has no jurisdiction over the person of [respondent Link];

B) The Complaint states no cause of action;

C) The Honorable Court has no appellate jurisdiction over DARAB cases; andcralawlibrary

D) This is patent case of forum shopping.12

The RTC granted respondent Link's motion in an Order dated 8 April 2003. After recounting the
proceedings before the DARAB, the RTC ruled that:

In view of this environmental milieu and the antecedent proceedings of this case which
originated from the aforesaid DARAB Cases, this Court is constrained to respect the said DARAB
proceedings and the Orders they had issued, for after all, this Court is not the appellate court of
the DARAB.

Rule XIV (Judicial Review, Section 1, of the DARAB New Rules of Procedure provides that:

"SECTION 1. Certiorari to the Court of Appeals. Any decision, order, award or ruling by the
Board or on any matter pertaining to the application, implementation of agrarian reform laws
or rules and regulations promulgated thereunder, may be brought within fifteen (15) days from
receipt of a copy thereof, to the Court of Appeals by certiorari . x x x.

If [herein petitioners] want to set aside the DARAB Orders dated December 10, 2001, March 21,
2002 and August 20, 2002 which they are now asking from this Court, they should have
directed their case to the Court of Appeals and not to this Court, pursuant to the
aforementioned provision of the DARAB Rules of Procedure.

Certainly, this Court cannot be blinded by the instant Complaint which was filed under the guise
of adding party plaintiffs and defendants, and adding a cause of action which is the
reinvidicatory action with damages, in order not to be detected and charged with violation of
forum shopping. These additions cannot hide the fact that the main purpose of the [petitioner]
FBMPC in the instant complaint is to delay, if not to block, the payment of the just
compensation in favor of [herein respondent] Manuel Link, which the DARAB, in its Order dated
December 10, 2001, had already awarded in favor of the said [respondent]. This Court does not
want to be party to this act of the [petitioners].13

And consequently decreed, thus:

WHEREFORE, premises considered, the instant MOTION TO DISMISS dated January 4, 2003 filed
by [respondent] Manuel Link is hereby GRANTED.

Accordingly, the instant Complaint dated November 12, 2002, is hereby ordered DISMISSED. 14

Petitioners filed a Motion for Reconsideration of the foregoing RTC Order but the same was
denied by the same court in an Order dated 28 July 2003.15 Petitioners received a copy of the
28 July 2003 Order of the RTC on 15 August 2003.

On 29 August 2003, petitioners filed their Notice of Appeal via registered mail, accordingly
furnishing the respondents a copy of the same.16

On 1 September 2003, petitioner Tan had to travel from Cebu City to Bogo, Cebu. He arrived at
Bogo already late in the afternoon, and unable to find an employee of the RTC, he left the
amount for the payment of the docket fees for their appeal to Mrs. Estrella Nini, an employee
of the Municipal Trial Court.

On 26 September 2003, the RTC issued an Order dismissing petitioners' Notice of Appeal.
According to the RTC:

Considering that Tereso C. Tan is not a real party-in-interest in this case, neither was he
specifically authorized by [herein petitioners] First Multi-Purpose Cooperative and Andre T.
Almocera to institute an appeal from the Orders of this Court dated April 8, 2003 and July 8,
2003 and considering further that the corresponding appeal fee was paid by him only on
September 2, 2003,17 which is beyond the last day of the reglementary period of filing the
appeal on August 30, 2003, the opposition of [herein respondent] Manuel Link to the said
appeal is hereby GRANTED.

WHEREFORE, premises considered, the NOTICE OF APPEAL dated August 29, 2003 filed by
Tereso Tan is hereby ordered DISMISSED and NOT GIVEN DUE COURSE, for lack of merit. 18

Petitioners' Motion for Reconsideration19 of the afore-quoted Order was denied by the RTC in
another Order dated 23 December 2003.20

Petitioners sought recourse from the Court of Appeals by filing a Petition for Certiorari, under
Rule 65, docketed as CA-G.R. SP No. 82957.

The Court of Appeals, however, in a Decision dated 21 February 2006, affirmed the RTC Orders
dated 26 September 2003 and 23 December 2003.

In its Decision, the appellate court found that contrary to the ruling of the RTC, petitioner Tan
had authority to file the Notice of Appeal on behalf of petitioners FBMPC and Almocera:

The notarized Secretary' [s] Certificate signed by Jovita A. Padilla dated May 22, 2002 of FBMPC
further shows that a resolution was passed by the cooperative on March 15, 2002 authorizing
Tereso Tan to be their lawful attorney in fact; to act for their name, place and stead the filing of
the necessary criminal, civil and administrative action against Manuel "Guy" Link and others; to
prosecute, by himself and through authorized agents the said cases including the filing of
whatever pleadings, motions, briefs, memoranda, including the pursuit of any appeal to any
appellate body, including administrative agencies; and to do what is absolutely necessary and
proper as required of in said cases. Clothed with the authority to act for and in behalf of the
petitioners, Tereso Tan therefore had the right to file the notice of appeal.21

However, the Court Appeals agreed with the RTC on the issue of late payment of docket fees, to
wit:

As to the issue on the late payment of docket fees, petitioner Tereso Tan contend that the
notice of appeal was made on August 29, 2003 and the payment of docket fee was made on
September 1, 2003, which is the last day for filing the notice of appeal because the 15 thday of
the period to file appeal fell on August 30, 2003, a Saturday.

Thus, on September 1, 2003, Tereso Tan traveled from Cebu City to Bogo, Cebu in order to pay
the filing fee. "Due to traffic due to vehicular defect," Tereso Tan was not able to find any
employee of the RTC when he arrived at the Palace of Justice of Bogo. With no RTC employee
to entertain him, he asked Mrs. Estrella Nini, an employee of MTCC of Bogo, Medellin whose
office is just at the ground floor of the same building of the RTC, to receive the payment of the
docket fee for practical purposes. However, the appeal fee was paid only on September 3,
2003. x x x.

In the case of Lazaro, et al. v. Court of Appeals, et al., the Supreme Court time and again ruled
that failure to pay docket and other lawful fees within the prescribed period is a ground for the
dismissal of an appeal.22

The dispositive portion of the Decision of the Court of Appeals reads:

Wherefore, in the light of the foregoing, the assailed Orders dated September 26, 2003 and
December 23, 2003 of the RTC of Bogo, Cebu are AFFIRMED.23

The appellate court denied petitioners' Motion for Reconsideration in a Resolution dated 12
May 2006.24

Petitioners are presently before this Court arguing that:

THE COURT OF APPEALS VIOLATED THE RIGHT OF PETITIONER TO DUE PROCESS WHEN IT DID
NOT CONSIDER THE REMITTANCE OF THE AMOUNT OF P500.00 BY PETITIONER TO MS.
ESTRELLA NINI, AN MTC COURT EMPLOYEE, ON 1 SEPTEMBER 2003 AS CONSTRUCTIVE
PAYMENT OF SAID DOCKET FEE;

THE COURT OF APPEALS VIOLATED THE RIGHT OF PETITIONER TO DUE PROCESS WHEN IT
DISREGARDED SUBSTANTIAL JUSTICE AND EQUITY CONSIDERING THE PETITIONER FILED HIS
NOTICE OF APPEAL AS EARLY AS 29 AUGUST 2003 AND HAD TRAVELLED ALL THE WAY FROM
CEBU CITY ON 1 SEPTEMBER 2003 FOR THE PURPOSE OF PAYING THE DOCKET FEE;

ASSUMING FOR THE SAKE OF DISCUSSION THAT THE DOCKET FEE WAS FILED ONLY ON 2
SEPTEMBER 2003 OR ACTUALLY ONE (1) DAY LATE, THE CIRCUMSTANCES OF PETITIONER
CLEARLY JUSTIFY ITS ADMISSION.25

Clearly, the fundamental issue in this case is whether the RTC was correct in denying
petitioners' appeal on the ground of late payment of docket fees.
This issue is not new and has been the subject of jurisprudence in numerous cases.

The dismissal of an appeal as the inevitable aftermath of the late payment of the appellate
docket fee has been mandated since the effectivity of the 1997 Rules of Civil Procedure under
Section 4 of Rule 41.

The payment of docket fees is a requirement in filing an ordinary appeal from the decision or
final order of the RTC, as provided in Rule 41, Section 4 of the 1997 Rules of Civil Procedure,
which reads:

Sec. 4. Appellate court docket and other lawful fees. - Within the period for taking an appeal,
the appellant shall pay to the clerk of the court which rendered the judgment or final order
appealed from, the full amount of the appellate court docket and other lawful fees. Proof of
payment of said fees shall be transmitted to the appellate court together with the original
record or the record on appeal.

The 1997 Rules of Civil Procedure, as amended, which took effect on 1 July 1997, now require
that appellate docket and other lawful fees must be paid within the same period for taking an
appeal. This is clear from the opening sentence of Section 4, Rule 41 of the same Rules that,
"[w]ithin the period for taking an appeal, the appellant shall pay to the clerk of the court which
rendered the judgment or final order appealed from, the full amount of the appellate court
docket and other lawful fees."

The use of the word "shall" underscores the mandatory character of the Rule. The term "shall"
is a word of command, one which has always been or which must be given a compulsory
meaning, and it is generally imperative or mandatory.

The right to appeal is purely a statutory right. Not being a natural right or a part of due process,
the right to appeal may be exercised only in the manner and in accordance with the rules
provided therefor. For this reason, payment of the full amount of the appellate court docket
and other lawful fees within the reglementary period is mandatory and jurisdictional.26

This Court has consistently upheld the dismissal of an appeal or notice of appeal for failure to
pay the full docket fees within the period for taking the appeal. The payment of docket fees
within the prescribed period is mandatory for the perfection of the appeal. Without such
payment, the appellate court does not acquire jurisdiction over the subject matter of the action
and the decision sought to be appealed from becomes final and executory.27

We have upheld the dismissal of deficient appeals in such cases as Lazaro v. Court of
Appeals,28 Chan v. Court of Appeals,29 Oriental Assurance Corp. v. Solidbank Corp.,30 Manalili v.
De Leon,31 La Salette College v. Pilotin,32 Navarro v. Metropolitan Bank & Trust Company,33 Saint
Louis University v. Cordero,34 M.A. Santander Construction, Inc. v. Villanueva,35 and Tamayo v.
Tamayo, Jr.36

Notwithstanding the catena of cases we have earlier cited, there are, admittedly, exceptions to
the general rule on the timely payment of appellate docket fees which are also embodied in
jurisprudence.37Yet a common thread in all of said cases is an exceptionally meritorious reason
why the appellate docket fees in the cases were not timely paid.

Thus, our only point of focus in determining whether there stands an exceptionally meritorious
reason why petitioners' appeal should be given due course is the justification that petitioner
Tan traveled all the way to Cebu but the traffic stalled him. That is all. Yet if we were to grant
the petition, it would set an ignoble precedent wherein mere allegation of traffic is sufficient to
relax the jurisdictional requirements for the perfection of an appeal.
In this case, petitioners received a copy of the RTC Order dated 28 July 2003 denying their
motion for reconsideration on 15 August 2003. They had 15 days therefrom, or until 30 August
2003, to perfect their appeal. However, 30 August 2003 was a Saturday. Hence, they had until 1
September 2003, Monday, the immediately succeeding working day, within which to file their
notice of appeal. Although petitioners claim that petitioner Tan left the amount for payment of
the docket fees with an MTC employee on 1 September 2003, said payment was actually made
and recorded on 3 September 2003 as shown by the official receipt issued to the
petitioners.38 Undeniably, the docket fees were paid late, and without payment of the docket
fees, petitioners' appeal was not perfected within the reglementary period.

Petitioners' excuse is not satisfactory. Petitioner Tan's late arrival at Bogo, Cebu was not
unpreventable for he could have left much, much earlier for his destination, considering that
the traffic congestion is almost infamous in Cebu, a fact certainly known to Tan. Their failure to
pay the docket fees on time manifested their lack of foresight and planning. Petitioner Tan
having arrived after office hours, he cannot expect any RTC employee to have stayed behind.

In cases where the Court upheld the liberal application of the rules, the appellants therein
hinged their arguments on exceptionally meritorious circumstances peculiar to their particular
situations that would convince the Court that they were entitled to a lax application of the
Rules. Petitioners herein did not show such meritorious circumstance.

We further explained the rule on payment of dockets when we held that:

In all, what emerges from all of the above is that the rules of procedure in the matter of paying
the docket fees must be followed. However, there are exceptions to the stringent requirement
as to call for a relaxation of the application of the rules, such as: (1) most persuasive and
weighty reasons; (2) to relieve a litigant from an injustice not commensurate with his failure to
comply with the prescribed procedure; (3) good faith of the defaulting party by immediately
paying within a reasonable time from the time of the default; (4) the existence of special or
compelling circumstances; (5) the merits of the case; (6) a cause not entirely attributable to the
fault or negligence of the party favored by the suspension of the rules; (7) a lack of any showing
that the review sought is merely frivolous and dilatory; (8) the other party will not be unjustly
prejudiced thereby; (9) fraud, accident, mistake or excusable negligence without appellant's
fault; (10) peculiar legal and equitable circumstances attendant to each case; (11) in the name
of substantial justice and fair play; (12) importance of the issues involved; and (13) exercise of
sound discretion by the judge guided by all the attendant circumstances. Concomitant to a
liberal interpretation of the rules of procedure should be an effort on the part of the party
invoking liberality to adequately explain his failure to abide by the rules. Anyone seeking
exemption from the application of the Rule has the burden of proving that exceptionally
meritorious instances exist which warrant such departure.39

Moreover, the Court finds no reversible error in the assailed Decision of the Court of Appeals
affirming the dismissal of Civil Case No. Bogo-00994 by the RTC.

Basic is the rule that jurisdiction is determined by the allegations in the Complaint. 40 In this
case, we find that jurisdiction over the complaint of the petitioners fell on the DARAB. Mainly,
petitioners do not agree in the Orders of the DARAB officials which were prejudicial to them.
Petitioners allege that the orders were issued by the DARAB with grave abuse of discretion or
with lack or excess of jurisdiction. Perusal of petitioners' complaint would reveal that
petitioners themselves invoked and accepted the jurisdiction of the DARAB over their dispute
with respondent Link. Petitioners' prayer41 is even more obvious: they request the RTC to
reverse/set aside the DARAB Order directing payment of just compensation to respondent Link
and the DARAB Order denying their Motion for reconsideration.
Section 1, Rule II, 2002 DARAB Rules of Procedure pointedly covers this particular issue before
us. It provides:

Section 1. Primary And Exclusive Original and Appellate Jurisdiction. - The board shall have
primary and exclusive jurisdiction, both original and appellate, to determine and adjudicate all
agrarian disputes involving the implementation of the Comprehensive Agrarian Reform
Program (CARP) under Republic Act No. 6657, Executive Order Nos. 228, 229, and 129-A,
Republic Act No. 3844 as amended by Republic Act No. 6389, Presidential Decree No. 27 and
other agrarian laws and their implementing rules and regulations. x x x.

Islanders CARP-Farmers Beneficiaries Multi-Purpose Cooperative, Inc. v. Lapanday Agricultural

and Development Corporation42 clearly instructs that:

All controversies on the implementation of the Comprehensive Agrarian Reform Program

(CARP) fall under the jurisdiction of the Department of Agrarian Reform (DAR), even though
they raise questions that are also legal or constitutional in nature. All doubts should be
resolved in favor of the DAR, since the law has granted it special and original authority to
hear and adjudicate agrarian matters. (Emphasis supplied.)

In Centeno v. Centeno43 we stated that:

[U]nder Section 50 of R.A. 6657 (the Comprehensive Agrarian Reform Law of 1988), the DAR is
vested with primary jurisdiction to determine and adjudicate agrarian reform matters and shall
have the exclusive jurisdiction over all matters involving the implementation of the agrarian
reform program. The rule is that the DARAB has jurisdiction to try and decide any agrarian
dispute or any incident involving the implementation of he Comprehensive Agrarian Reform
Program.

Since the DARAB's jurisdiction over the Complaint of the petitioners had been settled, and since
the DARAB had already ruled on the petitioners' objection to the payment of just compensation
in favor of Link, the proper remedy for the petitioners was to question at the Court of Appeals
the DARAB's Orders through a Petition for Certiorari under Rule 6544 of the Rules of Court45 as
embodied under the DARAB Rules of Procedure, Rule XIV, Section 1, viz:

Section 1. Certiorari to the Court of Appeals. - Any decision, order, resolution, award or ruling of
the Board on any agrarian dispute or on any matter pertaining to the application,
implementation, enforcement, interpretation of agrarian reform laws or rules and regulations
promulgated thereunder, may be brought within fifteen (15) days from receipt of a copy
thereof, to the Court of Appeals by certiorari. x x x.

WHEREFORE, premises considered, the Petition is DENIED. The Decision of the Court of Appeals
dated 21 February 2006 and the Resolution of the same court dated 12 May 2006
are AFFIRMED without prejudice to the filing of the proper case at the RTC to determine the
issue of ownership. Costs against petitioners.

SO ORDERED.

Endnotes:
1Penned by Associate Justice Arsenio J. Magpale with Associate Justices Vicente L. Yap and
Apolonio D. Bruselas, Jr. concurring; rollo, pp. 31-38

2 Rollo, p. 40.

3 Id. at 42.

4 Formerly the Regional Adjudicator of DAR Region VII.

5 Kintanar and Maquiling work at the DAR Adjudication Board (DARAB).

6 Cabangbang and Yuro are Officers of the LBP Valuation Office.

7 Impleaded in his official capacity as Officer of the DAR in Cebu; rollo, pp. 43-44.

8Date of Deed of Sale as appearing in the Petition filed by the petitioner to this Court (Rollo, p.
21) and the decision of the Court of Appeals (Rollo, p. 32) although petitioner claim that as early
as 1995, they already acquired the parcels of land. (Rollo, p. 22.)

9 Id. at 177.

10 Id. at 178.

11 Id. at 90.

12 Id. at 63.

13 Id. at 91-93.

14 Id. at 93.

15 Id. at 98.

16 Id. at 185.

17Official receipt issued to petitioners show that docket fees was paid 3 September 2003.
(Rollo, p. 236.)

18 Id. at 101.

19 Id. at 102.

20 Id. at 110-111.

21 Id. at 35-36.

22 Id. at 36.

23 Id. at 37.

24 Id. at 40.

25 Id. at 273-274.

26 Jose v. Court of Appeals, 447 Phil. 159, 165 (2003).

27See Manalili v. De Leon, 422 Phil. 214, 220 (2001); St. Louis University v. Cordero, G.R. No.
144118, 21 July 2004, 434 SCRA 575, 583.

28 386 Phil. 412, 417 (2000).

29 390 Phil. 615, 620 (2000).

30 392 Phil. 847, 854-855 (2000).

31 Supra note 27.

32 463 Phil. 785, 854-855 (2003).

33 G.R. No. 138031, 27 May 2004, 429 SCRA 439, 446-447.

34 Supra note 27.

35 G.R. No. 136477, 10 November 2004, 441 SCRA 525, 529-530.

36 G.R. No. 148482, 12 August 2005, 466 SCRA 618, 622-623.

37Mactan Cebu International Airport Authority v. Mangubat, 371 Phil. 393, 398 (1999); Ayala
Land, Inc. v. Carpo, 399 Phil. 327, 333-334 (2000); Yambao v. Court of Appeals, 399 Phil. 712,
717-718 (2000); Buenaflor v. Court of Appeals, 400 Phil. 395, 401 (2000); Alfonso v. Andres, 439
Phil. 298, 305-306 (2002); Villamor v. Court of Appeals, G.R. No. 136858, 21 July 2004, 434 SCRA
565, 573-574.

38 Rollo, p. 236.

39 KLT Fruits, Inc. v. WSR Fruits, Inc., G.R. No. 174219, 23 November 2007, 538 SCRA 713, 728.

40 Vda. de Victoria v. Court of Appeals, G.R. No. 147550, 26 January 2005, 449 SCRA 319, 326.

41 WHEREFORE, it is most respectfully prayed that:

1. Writs of certiorari, prohibition and mandamus with preliminary prohibitory injunction issue
against defendant officials as follows:

A. A writ of certiorari issue setting aside the orders dated December 10, 2001 (Annex "L"), May
13, 2002 (Annex "P") and August 20, 2002 (Annex "V") and any subsequent orders of the DARAB
Provincial/Regional Adjudicator of Cebu Province/Region VII that may have been issued without
the intervention of herein plaintiffs, for being issued in grave abuse of discretion amounting to
lack of jurisdiction; that with regards to the register of deeds of the province of Cebu, to set
aside the registration of any transaction with respect to the said lands in derogation of the
rights of ownership and possession of the herein plaintiffs;

B. A writ of prohibition and writ of mandamus issue against the said officers prohibiting them
from taking further cognizance of the land valuation cases over the subject properties and from
further issuing any order that will affect the payment of compensation on the said properties,
as well as prohibiting the defendant Land Bank Officers from releasing any amount of the
moneys now deposited with the Land Bank Depositary in its Cebu City Branch in P. del Rosario
Street, Cebu City or any other branch or main office where such moneys are deposited; that
should such orders for release of the moneys be already issued, that the defendant officials be
prohibited from enforcing them; and with respect to the defendant register of deeds of the
province of Cebu, that he be prohibited from registering any transaction;

C. A writ of preliminary mandatory and prohibitory injunction issue against the above-named
officers restraining all of them: (a) on the part of DAR adjudicators from taking further
cognizance of the case or from issuing orders particularly with respect to the release of any
moneys due as just compensation of the lands subject of the instant case to defendant Manuel
Guy Link; (b) with respect to defendant Land Bank Officials and any other authorized
representative of Land Bank of the Philippines, from releasing any such moneys to defendant
Manuel "Guy" Link; (c) that should said orders for release be already issued, that the defendant
DAR adjudicators and Land Bank Officials be prohibited from enforcing the same; (d) that with
respect to the defendant register of deeds of the province of Cebu, that he be restrained from
registering any transaction involving the lands subject of the instant case in derogation of the
rights of ownership and possession of the plaintiffs. (Rollo, pp. 55-56.)

42 G.R. No. 159089, 3 May 2006, 489 SCRA 80, 92-93.

43 397 Phil. 170, 177 (2000).

44 Certiorari, Prohibition and Mandamus.

45Islanders CARP-Farmers Beneficiaries Multi-Purpose Cooperative, Inc. v. Lapanday

Agricultural and Development Corp., supra note 42.

ALFON v Republic G.R. No. L-51201 May 29, 1980

IN THE MATTER OF THE PETITION FOR CHANGE OF NAME OF MARIA ESTRELLA VERONICA
PRIMITIVA DUTERTE, ESTRELLA S. ALFON, petitioner,
vs.
REPUBLIC OF THE PHILIPPINES, respondent.

ABAD SANTOS, J.:ñé+.£ªwph!1

This is a petition filed pursuant to Republic Act No. 5440 to review an Order of the Court of First
Instance of Rizal, Branch XXIII, dated December 29, 1978, which partially denied petitioner's
prayer for a change of name. Only a question of law is involved and there is no controversy over
the facts which are well-stated in the questioned Order as follows: têñ.£îhqwâ£

This is verified petition filed on April 28, 1978 by petitioner Maria Estrella
Veronica Primitiva Duterte through her counsel, Atty. Rosauro Alvarez, praying
that her name be changed from Maria Estrella Veronica Primitiva Duterte to
Estrella S. Alfon.

The notice setting the petition for hearing on December 14, 1978 at 8:30 o'clock
in the morning was published in the Times Journal in its issues of July 28, August
5 and 11, 1978 and a copy thereof together with a copy of the petition was
furnished the Office of the Solicitor General (Exhibits C, C-1, C-2 and C-3).
At the hearing of the petition on December 14, 1978, Atty. Rosauro Alvarez
appeared for the petitioner and Fiscal Donato Sor. Suyat, Jr. represented the
office of the Solicitor General, Upon motion of counsel for the petitioner,
without objection on the part of Fiscal Suyat, the Deputy Clerk of Court was
appointed commissioner to receive the evidence and to submit the same for
resolution of the Court.

From the testimonial and document evidence presented, it appears that

petitioner Maria Estrella Veronica Primitiva Duterte was born on May 15, 1952 at
the U.S.T. Hospital (Exhibit A). She was registered at the local Civil Registrar's
Office as Maria Estrella Veronica Primitiva Duterte On June 15, 1952, she was
baptized as Maria Estrella Veronica Primitiva Duterte at the St. Anthony de
Padua Church Singalong, Manila (Exhibit B). Her parents are Filomeno Duterte
and Estrella Veronica Primitiva Duterte has been taken cared of by Mr. and Mrs.
Hector Alfon. Petitioner and her uncle, Hector Alfon, have been residing at 728
J.R. Yulo Street corner Ideal Street, Mandaluyong, Metro Manila for twenty-
three (23) years. When petitioner started schooling, she used the name Estrella
S. Alfon. She attended her first grade up to fourth year high school at Stella
Maris College using the name Estrella S. Alfon (Exhibits E, E-1, E-2 and E-3). After
graduating from high school she enrolled at the Arellano University and finished
Bachelor of Science in Nursing (Exhibit E-4). Her scholastic records from
elementary to college show that she was registered by the name of Estrella S.
Alfon. Petitioner has exercised her right of suffrage under the same name
(Exhibit D). She has not committed any felony or misdemeanor (Exhibits G, G-1,
G-2, G-3 and G-4).

Petitioner has advanced the following reasons for filing the petition:

1. She has been using the name Estrella Alfon since her childhood;

2. She has been enrolled in the grade school and in college using the same name;

3. She has continuously used the name Estrella S. Alfon since her infancy and all
her friends and acquaintances know her by this name;

4. She has exercised her right of suffrage under the same name.

Section 5, Rule 103 of the Rules of Court provides:

Upon satisfactory proof in open court on the date fixed in the order that such
order has been published as directed and that the allegations of the petition are
true, the court shall if proper and reasonable cause appears for changing the
name of the petitioner adjudge that such name be changed in accordance with
the prayer of the petition.

The evidence submitted shows that the change of name from Maria Estrella
Veronica Primitiva Duterte to Estrella Alfon is not proper and reasonable with
respect to the surname. The fact that petitioner has been using a different
surname and has become known with such surname does not constitute proper
and reasonable cause to legally authorize and change her surname to Alfon. The
birth certificate clearly shows that the father of petitioner is Filomeno Duterte.
Petitioner likewise admitted this fact in her testimony. To allow petitioner to
change her surname from Duterte to Alfon is equivalent to allowing her to use
her mother's surname. Article 364 of the Civil Code provides:
 Legitimate and legitimated children shall principally use the surname of the
father.

If another purpose of the petitioner is to carry the surname of Alfon because her
uncle who reared her since childhood has the surname "Alfon" then the remedy
is not a petition for change of name.

WHEREFORE, the petition insofar as the first name is granted but denied with
respect to the surname. Petitioner is authorized to change her name from Maria
Estrella Veronica Primitiva Duterte to Estrella Alfon Duterte.

Let copy of this order be furnished the Local Civil Registrar of Pasig, Metro
Manila pursuant to Section 3, Rule 103 of the Rules of Court.

The lower court should have fully granted the petition.

The only reason why the lower court denied the petitioner's prayer to change her surname is
that as legitimate child of Filomeno Duterte and Estrella Alfon she should principally use the
surname of her father invoking Art. 364 of the Civil Code. But the word "principally" as used in
the codal provision is not equivalent to "exclusively" so that there is no legal obstacle if a
legitimate or legitimated child should choose to use the surname of its mother to which it is
equally entitled. Moreover, this Court in Haw Liong vs. Republic, G.R. No. L-21194. April 29,
1966, 16 SCRA 677, 679, said: têñ.£îhqwâ£

The following may be considered, among others, as proper or reasonable causes

that may warrant the grant of a petitioner for change of name; (1) when the
name is ridiculous, tainted with dishonor, or is extremely difficult to write or
pronounce; (2) when the request for change is a consequence of a change of'
status, such as when a natural child is acknowledged or legitimated; and (3)
when the change is necessary to avoid confusion Tolentino, Civil Code of the
Philippines, 1953 ed., Vol. 1, p. 660).

In the case at bar, it has been shown that petitioner has, since childhood, borne the name
Estrella S. Alfon although her birth records and baptismal certificate show otherwise; she was
enrolled in the schools from the grades up to college under the name Estrella S. Alfon; all her
friends call her by this name; she finished her course in Nursing in college and was graduated
and given a diploma under this name; and she exercised the right of suffrage likewise under this
name. There is therefore ample justification to grant fully her petition which is not whimsical
but on the contrary is based on a solid and reasonable ground, i.e. to avoid confusion.

WHEREFORE, the Order appealed from is hereby modified in that, the petitioner is allowed to
change not only her first name but also her surname so as to be known as ESTRELLA S. ALFON.
No costs.

SO ORDERED.

Barredo (Chairman), Aquino, Concepcion, Jr., and De Castro, JJ., concur.1ä

People v. Nazario G.R. No. L-44143 August 31, 1988

THE PEOPLE OF THE PHILIPPINES, plaintiff,

vs.
EUSEBIO NAZARIO, accused-appellant.

The Solicitor General for plaintiff-appellee.

Teofilo Ragodon for accused-appellant.

SARMIENTO, J.:

The petitioner was charged with violation of certain municipal ordinances of the municipal
council of Pagbilao, in Quezon province. By way of confession and avoidance, the petitioner
would admit having committed the acts charged but would claim that the ordinances are
unconstitutional, or, assuming their constitutionality, that they do not apply to him in any
event.

The facts are not disputed:

This defendant is charged of the crime of Violation of Municipal Ordinance in an

information filed by the provincial Fiscal, dated October 9, 1968, as follows:

That in the years 1964, 1965 and 1966, in the Municipality of

Pagbilao, Province of Quezon, Philippines, and within the
jurisdiction of this Honorable Court, the above-named accused,
being then the owner and operator of a fishpond situated in the
barrio of Pinagbayanan, of said municipality, did then and there
willfully, unlawfully and feloniously refuse and fail to pay the
municipal taxes in the total amount of THREE HUNDRED SIXTY
TWO PESOS AND SIXTY TWO CENTAVOS (P362.62), required of
him as fishpond operator as provided for under Ordinance No. 4,
series of 1955, as amended, inspite of repeated demands made
upon him by the Municipal Treasurer of Pagbilao, Quezon, to pay
the same.

Contrary to law.

For the prosecution the following witnesses testified in substance as follows;

MIGUEL FRANCIA, 39 years of age, married, farmer and resident of Lopez,

Quezon —

In 1962 to 1967, I resided at Pinagbayanan, Pagbilao, Quezon. I know the

accused as I worked in his fishpond in 1962 to 1964. The fishpond of Nazario is at
Pinagbayanan, Pagbilao, Quezon. I worked in the clearing of the fishpond, the
construction of the dikes and the catching of fish.

On cross-examination, this witness declared:

I worked with the accused up to March 1964.

NICOLAS MACAROLAY, 65 years of age, married, copra maker and resident of
Pinagbayanan, Pagbilao, Quezon —

I resided at Pinagbayanan, Pagbilao, Quezon since 1959 up to the present. I

know the accused since 1959 when he opened a fishpond at Pinagbayanan,
Pagbilao, Quezon. He still operates the fishpond up to the present and I know
this fact as I am the barrio captain of Pinagbayanan.

On cross-examination, this witness declared:

I came to know the accused when he first operated his fishpond since 1959.

On re-direct examination, this witness declared:

I was present during the catching of fish in 1967 and the accused was there.

On re-cross examination, this witness declared:

I do not remember the month in 1962 when the accused caught fish.

RODOLFO R. ALVAREZ, 45 years old, municipal treasurer of Pagbilao, Quezon,

married —

As Municipal Treasurer I am in charge of tax collection. I know the accused even

before I was Municipal Treasurer of Pagbilao. I have written the accused a letter
asking him to pay his taxes (Exhibit B). Said letter was received by the accused as
per registry return receipt, Exhibit B-1. The letter demanded for payment of
P362.00, more or less, by way of taxes which he did not pay up to the present.
The former Treasurer, Ceferino Caparros, also wrote a letter of demand to the
accused (Exhibit C). On June 28, 1967, I sent a letter to the Fishery Commission
(Exhibit D), requesting information if accused paid taxes with that office. The
Commission sent me a certificate (Exhibits D-1, D-2 & D-3). The accused had a
fishpond lease agreement. The taxes unpaid were for the years 1964, 1965 and
1966.

On cross-examination, this witness declared:

I have demanded the taxes for 38.10 hectares.

On question of the court, this witness declared:

What I was collecting from the accused is the fee on fishpond operation, not
rental.

The prosecution presented as part of their evidence Exhibits A, A-1, A-2, B, B-2,
C, D, D-1, D-2, D-3, E, F, F-1 and the same were admitted by the court, except
Exhibits D, D-1, D-2 and D-3 which were not admitted for being immaterial.

For the defense the accused EUSEBIO NAZARIO, 48 years of age, married, owner
and general manager of the ZIP Manufacturing Enterprises and resident of 4801
Old Sta. Mesa, Sampaloc, Manila, declared in substance as follows:

I have lived in Sta. Mesa, Manila, since 1949. I buy my Residence Certificates at
Manila or at San Juan. In 1964, 1965 and 1966, I was living in Manila and my
business is in Manila and my family lives at Manila. I never resided at Pagbilao,
Quezon. I do not own a house at Pagbilao. I am a lessee of a fishpond located at
Pagbilao, Quezon, and I have a lease agreement to that effect with the Philippine
Fisheries Commission marked as Exhibit 1. In 1964, 1965 and 1966, the contract
of lease, Exhibit 1, was still existing and enforceable. The Ordinances Nos. 4, 15
and 12, series of 1955, 1965 and 1966, were translated into English by the
Institute of National Language to better understand the ordinances. There were
exchange of letters between me and the Municipal Treasurer of Pagbilao
regarding the payment of the taxes on my leased fishpond situated at Pagbilao.
There was a letter of demand for the payment of the taxes by the treasurer
(Exhibit 3) which I received by mail at my residence at Manila. I answered the
letter of demand, Exhibit 3, with Exhibit 3-A. I requested an inspection of my
fishpond to determine its condition as it was not then in operation. The
Municipal Treasurer Alvarez went there once in 1967 and he found that it was
destroyed by the typhoon and there were pictures taken marked as Exhibits 4, 4-
A, 4-B and 4C. I received another letter of demand, Exhibit 5, and I answered the
same (Exhibit 5-A). I copied my reference quoted in Exhibit 5-A from
Administrative Order No. 6, Exhibit 6. I received another letter of demand from
Tomas Ornedo, Acting Municipal Treasurer of Pagbilao, dated February 16, 1966,
Exhibit 7, and I answered the same with the letter marked as Exhibit 7-A, dated
February 26, 1966. I received another letter of demand from Treasurer Alvarez of
Pagbilao, Exhibit 8, and I answered the same (Exhibit 8-A). In 1964, I went to
Treasurer Caparros to ask for an application for license tax and he said none and
he told me just to pay my taxes. I did not pay because up to now I do not know
whether I am covered by the Ordinance or not. The letters of demand asked me
to pay different amounts for taxes for the fishpond. Because under Sec. 2309 of
the Revised Administrative Code, municipal taxes lapse if not paid and they are
collecting on a lapsed ordinance. Because under the Tax Code, fishermen are
exempted from percentage tax and privilege tax. There is no law empowering
the municipality to pass ordinance taxing fishpond operators.

The defense presented as part of their evidence Exhibits 1, 2, 3, 3-A, 4, 4-B, 4-B,
4-C, 5, 5-A, 6, 6-A, 6-B, 6-C, 7, 7-A, 8 and 8-A and the same were admitted by the
court.

From their evidence the prosecution would want to show to the court that the
accused, as lessee or operator of a fishpond in the municipality of Pagbilao,
refused, and still refuses, to pay the municipal taxes for the years 1964, 1965 and
1966, in violation of Municipal Ordinance No. 4, series of 1955, as amended by
Municipal Ordinance No. 15, series of 1965, and finally amended by Municipal
Ordinance No. 12, series of 1966.

On the other hand, the accused, by his evidence, tends to show to the court that
the taxes sought to be collected have already lapsed and that there is no law
empowering municipalities to pass ordinances taxing fishpond operators. The
defense, by their evidence, tried to show further that, as lessee of a forest land
to be converted into a fishpond, he is not covered by said municipal ordinances;
and finally that the accused should not be taxed as fishpond operator because
there is no fishpond yet being operated by him, considering that the supposed
fishpond was under construction during the period covered by the taxes sought
to be collected.

Finally, the defendant claims that the ordinance in question is ultra vires as it is
outside of the power of the municipal council of Pagbilao, Quezon, to enact; and
 that the defendant claims that the ordinance in question is ambiguous and
uncertain.

There is no question from the evidences presented that the accused is a lessee
of a parcel of forest land, with an area of 27.1998 hectares, for fishpond
purposes, under Fishpond Lease Agreement No. 1066, entered into by the
accused and the government, through the Secretary of Agriculture and Natural
Resources on August 21, 1959.

There is no question from the evidences presented that the 27.1998 hectares of
land leased by the defendant from the government for fishpond purposes was
actually converted into fishpond and used as such, and therefore defendant is an
operator of a fishpond within the purview of the ordinance in question. 1

The trial Court 2 returned a verdict of guilty and disposed as follows:

VIEWED IN THE LIGHT OF ALL THE FOREGOING, the Court finds the accused guilty beyond
reasonable doubt of the crime of violation of Municipal Ordinance No. 4, series of 1955, as
amended by Ordinance No. 15, series of 1965 and further amended by Ordinance No. 12, series
of 1966, of the Municipal Council of Pagbilao, Quezon; and hereby sentences him to pay a fine
of P50.00, with subsidiary imprisonment in case of insolvency at the rate of P8.00 a day, and to
pay the costs of this proceeding.

SO ORDERED. 3

In this appeal, certified to this Court by the Court of Appeals, the petitioner alleges that:

I.

THE LOWER COURT ERRED IN NOT DECLARING THAT ORDINANCE NO. 4, SERIES OF 1955, AS
AMENDED BY ORDINANCE NO. 15, SERIES OF 1965, AND AS FURTHER AMENDED BY
ORDINANCE NO. 12, SERIES OF 1966, OF THE MUNICIPALITY OF PAGBILAO, QUEZON, IS NULL
AND VOID FOR BEING AMBIGUOUS AND UNCERTAIN.

II.

THE LOWER COURT ERRED IN NOT HOLDING THAT THE ORDINANCE IN QUESTION, AS
AMENDED, IS UNCONSTITUTIONAL FOR BEING EX POST FACTO.

III.

THE LOWER COURT ERRED IN NOT HOLDING THAT THE ORDINANCE IN QUESTION COVERS
ONLY OWNERS OR OVERSEER OF FISHPONDS OF PRIVATE OWNERSHIP AND NOT TO LESSEES OF
PUBLIC LANDS.

IV.

THE LOWER COURT ERRED IN NOT FINDING THAT THE QUESTIONED ORDINANCE, EVEN IF
VALID, CANNOT BE ENFORCED BEYOND THE TERRITORIAL LIMITS OF PAGBILAO AND DOES NOT
COVER NON-
RESIDENTS. 4
The ordinances in question are Ordinance No. 4, series of 1955, Ordinance No. 15, series of
1965, and Ordinance No. 12, series of 1966, of the Municipal Council of Pagbilao. Insofar as
pertinent to this appeal, the salient portions thereof are hereinbelow quoted:

Section 1. Any owner or manager of fishponds in places within the territorial

limits of Pagbilao, Quezon, shall pay a municipal tax in the amount of P3.00 per
hectare of fishpond on part thereof per annum. 5

xxx xxx xxx

Sec. l (a). For the convenience of those who have or owners or managers of
fishponds within the territorial limits of this municipality, the date of payment of
municipal tax relative thereto, shall begin after the lapse of three (3) years
starting from the date said fishpond is approved by the Bureau of Fisheries. 6

xxx xxx xxx

Section 1. Any owner or manager of fishponds in places within the territorial

limits of Pagbilao shall pay a municipal tax in the amount of P3.00 per hectare or
any fraction thereof per annum beginning and taking effect from the year 1964,
if the fishpond started operating before the year 1964. 7

The first objection refers to the ordinances being allegedly "ambiguous and uncertain." 8 The
petitioner contends that being a mere lessee of the fishpond, he is not covered since the said
ordinances speak of "owner or manager." He likewise maintains that they are vague insofar as
they reckon the date of payment: Whereas Ordinance No. 4 provides that parties shall
commence payment "after the lapse of three (3) years starting from the date said fishpond is
approved by the Bureau of Fisheries." 9 Ordinance No. 12 states that liability for the tax accrues
"beginning and taking effect from the year 1964 if the fishpond started operating before the
year 1964." 10

As a rule, a statute or act may be said to be vague when it lacks comprehensible standards that
men "of common intelligence must necessarily guess at its meaning and differ as to its
application." 11 It is repugnant to the Constitution in two respects: (1) it violates due process for
failure to accord persons, especially the parties targetted by it, fair notice of the conduct to
avoid; and (2) it leaves law enforcers unbridled discretion in carrying out its provisions and
becomes an arbitrary flexing of the Government muscle.

But the act must be utterly vague on its face, that is to say, it cannot be clarified by either a
saving clause or by construction. Thus, in Coates v. City of Cincinnati, 12 the U.S. Supreme Court
struck down an ordinance that had made it illegal for "three or more persons to assemble on
any sidewalk and there conduct themselves in a manner annoying to persons passing
by." 13 Clearly, the ordinance imposed no standard at all "because one may never know in
advance what 'annoys some people but does not annoy others.' " 14

Coates highlights what has been referred to as a "perfectly vague" 15 act whose obscurity is
evident on its face. It is to be distinguished, however, from legislation couched in imprecise
language — but which nonetheless specifies a standard though defectively phrased — in which
case, it may be "saved" by proper construction.

It must further be distinguished from statutes that are apparently ambiguous yet fairly
applicable to certain types of activities. In that event, such statutes may not be challenged
whenever directed against such activities. In Parker v. Levy, 16 a prosecution originally under the
U.S. Uniform Code of Military Justice (prohibiting, specifically, "conduct unbecoming an officer
and gentleman"), the defendant, an army officer who had urged his men not to go to Vietnam
and called the Special Forces trained to fight there thieves and murderers, was not allowed to
invoke the void for vagueness doctrine on the premise that accepted military interpretation and
practice had provided enough standards, and consequently, a fair notice that his conduct was
impermissible.

It is interesting that in Gonzales v. Commission on Elections, 17 a divided Court sustained an act

of Congress (Republic Act No. 4880 penalizing "the too early nomination of
candidates" 18 limiting the election campaign period, and prohibiting "partisan political
activities"), amid challenges of vagueness and overbreadth on the ground that the law had
included an "enumeration of the acts deemed included in the terms 'election campaign' or
'partisan political activity" 19 that would supply the standards. "As thus limited, the objection
that may be raised as to vagueness has been minimized, if not totally set at rest." 20 In his
opinion, however, Justice Sanchez would stress that the conduct sought to be prohibited "is not
clearly defined at all." 21 "As worded in R.A 4880, prohibited discussion could cover the entire
spectrum of expression relating to candidates and political parties." 22 He was unimpressed
with the "restrictions" Fernando's opinion had relied on: " 'Simple expressions of opinions and
thoughts concerning the election' and expression of 'views on current political problems or
issues' leave the reader conjecture, to guesswork, upon the extent of protection offered, be it
as to the nature of the utterance ('simple expressions of opinion and thoughts') or the subject
of the utterance ('current political problems or issues')." 23

The Court likewise had occasion to apply the "balancing-of-interests" test, 24 insofar as the
statute's ban on early nomination of candidates was concerned: "The rational connection
between the prohibition of Section 50-A and its object, the indirect and modest scope of its
restriction on the rights of speech and assembly, and the embracing public interest which
Congress has found in the moderation of partisan political activity, lead us to the conclusion
that the statute may stand consistently with and does not offend the Constitution." 25 In that
case, Castro would have the balance achieved in favor of State authority at the "expense" of
individual liberties.

In the United States, which had ample impact on Castro's separate opinion, the balancing test
finds a close kin, referred to as the "less restrictive alternative " 26 doctrine, under which the
court searches for alternatives available to the Government outside of statutory limits, or for
"less drastic means" 27 open to the State, that would render the statute unnecessary. In United
States v. Robel, 28 legislation was assailed, banning members of the (American) Communist
Party from working in any defense facility. The U.S. Supreme Court, in nullifying the statute,
held that it impaired the right of association, and that in any case, a screening process was
available to the State that would have enabled it to Identify dangerous elements holding
defense positions. 29 In that event, the balance would have been struck in favor of individual
liberties.

It should be noted that it is in free expression cases that the result is usually close. It is said,
however, that the choice of the courts is usually narrowed where the controversy involves say,
economic rights, 30 or as in the Levycase, military affairs, in which less precision in analysis is
required and in which the competence of the legislature is presumed.

In no way may the ordinances at bar be said to be tainted with the vice of vagueness. It is
unmistakable from their very provisions that the appellant falls within its coverage. As the
actual operator of the fishponds, he comes within the term " manager." He does not deny the
fact that he financed the construction of the fishponds, introduced fish fries into the fishponds,
and had employed laborers to maintain them. 31 While it appears that it is the National
Government which owns them, 32 the Government never shared in the profits they had
generated. It is therefore only logical that he shoulders the burden of tax under the said
ordinances.

We agree with the trial court that the ordinances are in the character of revenue
measures 33 designed to assist the coffers of the municipality of Pagbilao. And obviously, it
cannot be the owner, the Government, on whom liability should attach, for one thing, upon the
ancient principle that the Government is immune from taxes and for another, since it is not the
Government that had been making money from the venture.

Suffice it to say that as the actual operator of the fishponds in question, and as the recipient of
profits brought about by the business, the appellant is clearly liable for the municipal taxes in
question. He cannot say that he did not have a fair notice of such a liability to make such
ordinances vague.

Neither are the said ordinances vague as to dates of payment. There is no merit to the claim
that "the imposition of tax has to depend upon an uncertain date yet to be determined (three
years after the 'approval of the fishpond' by the Bureau of Fisheries, and upon an uncertain
event (if the fishpond started operating before 1964), also to be determined by an uncertain
individual or individuals." 34 Ordinance No. 15, in making the tax payable "after the lapse of
three (3) years starting from the date said fishpond is approved by the Bureau of Fisheries," 35 is
unequivocal about the date of payment, and its amendment by Ordinance No. 12, reckoning
liability thereunder "beginning and taking effect from the year 1964 if the fishpond started
operating before the year 1964 ," 36 does not give rise to any ambiguity. In either case, the
dates of payment have been definitely established. The fact that the appellant has been
allegedly uncertain about the reckoning dates — as far as his liability for the years 1964, 1965,
and 1966 is concerned — presents a mere problem in computation, but it does not make the
ordinances vague. In addition, the same would have been at most a difficult piece of legislation,
which is not unfamiliar in this jurisdiction, but hardly a vague law.

As it stands, then, liability for the tax accrues on January 1, 1964 for fishponds in operation
prior thereto (Ordinance No. 12), and for new fishponds, three years after their approval by the
Bureau of Fisheries (Ordinance No. 15). This is so since the amendatory act (Ordinance No. 12)
merely granted amnesty unto old, delinquent fishpond operators. It did not repeal its mother
ordinances (Nos. 4 and 15). With respect to new operators, Ordinance No. 15 should still
prevail.

To the Court, the ordinances in question set forth enough standards that clarify imagined
ambiguities. While such standards are not apparent from the face thereof, they are visible from
the intent of the said ordinances.

The next inquiry is whether or not they can be said to be ex post facto measures. The appellant
argues that they are: "Amendment No. 12 passed on September 19, 1966, clearly provides that
the payment of the imposed tax shall "beginning and taking effect from the year 1964, if the
fishpond started operating before the year 1964.' In other words, it penalizes acts or events
occurring before its passage, that is to say, 1964 and even prior thereto." 37

The Court finds no merit in this contention. As the Solicitor General notes, "Municipal
Ordinance No. 4 was passed on May 14, 1955. 38 Hence, it cannot be said that the amendment
(under Ordinance No. 12) is being made to apply retroactively (to 1964) since the reckoning
period is 1955 (date of enactment). Essentially, Ordinances Nos. 12 and 15 are in the nature of
curative measures intended to facilitate and enhance the collection of revenues the originally
act, Ordinance No. 4, had prescribed. 39 Moreover, the act (of non-payment of the tax), had
been, since 1955, made punishable, and it cannot be said that Ordinance No. 12 imposes a
retroactive penalty. As we have noted, it operates to grant amnesty to operators who had been
delinquent between 1955 and 1964. It does not mete out a penalty, much less, a retrospective
one.

The appellant assails, finally, the power of the municipal council of Pagbilao to tax "public forest
land." 40 In Golden Ribbon Lumber Co., Inc. v. City of Butuan 41 we held that local governments'
taxing power does not extend to forest products or concessions under Republic Act No. 2264,
the Local Autonomy Act then in force. (Republic Act No. 2264 likewise prohibited municipalities
from imposing percentage taxes on sales.)

First of all, the tax in question is not a tax on property, although the rate thereof is based on the
area of fishponds ("P3.00 per hectare" 42). Secondly, fishponds are not forest lands, although
we have held them to the agricultural lands. 43 By definition, "forest" is "a large tract of land
covered with a natural growth of trees and underbush; a large wood." 44 (Accordingly, even if
the challenged taxes were directed on the fishponds, they would not have been taxes on forest
products.)

They are, more accurately, privilege taxes on the business of fishpond maintenance. They are
not charged against sales, which would have offended the doctrine enshrined by Golden Ribbon
Lumber, 45 but rather on occupation, which is allowed under Republic Act No. 2264. 46 They are
what have been classified as fixed annual taxes and this is obvious from the ordinances
themselves.

There is, then, no merit in the last objection.

WHEREFORE, the appeal is DISMISSED. Costs against the appellant.

Fernan, C.J., Narvasa, Gutierrez, Jr., Cruz, Paras, Feliciano, Padilla, Bidin, Cortes, Griño-Aquino
and Medialdea, JJ., concur.

Melencio-Herrera, and Regalado, J., took no part.

Gancayco, J., is on leave.

Ching v. Goyanko G.R. No. 165879 November 10, 2006

MARIA B. CHING, Petitioner,

vs.
JOSEPH C. GOYANKO, JR., EVELYN GOYANKO, JERRY GOYANKO, IMELDA GOYANKO, JULIUS
GOYANKO, MARY ELLEN GOYANKO AND JESS GOYANKO, Respondents.

DECISION

CARPIO MORALES, J.:

On December 30, 1947, Joseph Goyanko (Goyanko) and Epifania dela Cruz (Epifania) were
married.1 Out of the union were born respondents Joseph, Jr., Evelyn, Jerry, Imelda, Julius,
Mary Ellen and Jess, all surnamed Goyanko.

Respondents claim that in 1961, their parents acquired a 661 square meter property located at
29 F. Cabahug St., Cebu City but that as they (the parents) were Chinese citizens at the time, the
property was registered in the name of their aunt, Sulpicia Ventura (Sulpicia).
On May 1, 1993, Sulpicia executed a deed of sale2 over the property in favor of respondents’
father Goyanko. In turn, Goyanko executed on October 12, 1993 a deed of sale 3 over the
property in favor of his common-law-wife-herein petitioner Maria B. Ching. Transfer Certificate
of Title (TCT) No. 138405 was thus issued in petitioner’s name.

After Goyanko’s death on March 11, 1996, respondents discovered that ownership of the
property had already been transferred in the name of petitioner. Respondents thereupon had
the purported signature of their father in the deed of sale verified by the Philippine National
Police Crime Laboratory which found the same to be a forgery.4

Respondents thus filed with the Regional Trial Court of Cebu City a complaint for recovery of
property and damages against petitioner, praying for the nullification of the deed of sale and of
TCT No. 138405 and the issuance of a new one in favor of their father Goyanko.

In defense, petitioner claimed that she is the actual owner of the property as it was she who
provided its purchase price. To disprove that Goyanko’s signature in the questioned deed of
sale is a forgery, she presented as witness the notary public who testified that Goyanko
appeared and signed the document in his presence.

By Decision of October 16, 1998,5 the trial court dismissed the complaint against petitioner, the
pertinent portions of which decision read:

There is no valid and sufficient ground to declare the sale as null and void, fictitious and
simulated. The signature on the questioned Deed of Sale is genuine. The testimony of Atty.
Salvador Barrameda who declared in court that Joseph Goyanko, Sr. and Maria Ching together
with their witnesses appeared before him for notarization of Deed of Sale in question is more
reliable than the conflicting testimonies of the two document examiners. Defendant Maria
Ching asserted that the Deed of Sale executed by Joseph Goyanko, Sr. in her favor is valid and
genuine. The signature of Joseph Goyanko, Sr. in the questioned Deed of Absolute Sale is
genuine as it was duly executed and signed by Joseph Goyanko, Sr. himself.

The parcel of lands known as Lot No. 6 which is sought to be recovered in this case could never
be considered as the conjugal property of the original Spouses Joseph C. Goyanko and Epifania
dela Cruz or the exclusive capital property of the husband. The acquisition of the said property
by defendant Maria Ching is well-elicited from the aforementioned testimonial and
documentary evidence presented by the defendant. Although for a time being the property
passed through Joseph Goyanko, Sr. as a buyer yet his ownership was only temporary and
transitory for the reason that it was subsequently sold to herein defendant Maria Ching. Maria
Ching claimed that it was even her money which was used by Joseph Goyanko, Sr. in the
purchase of the land and so it was eventually sold to her. In her testimony, defendant Ching
justified her financial capability to buy the land for herself. The transaction undertaken was
from the original owner Sulpicia Ventura to Joseph Goyanko, Sr. and then from Joesph
Goyanko, Sr. to herein defendant Maria Ching.

The land subject of the litigation is already registered in the name of defendant Maria Ching
under TCT No. 138405. By virtue of the Deed of Sale executed in favor of Maria Ching, Transfer
Certificate of Title No. 138405 was issued in her favor. In recognition of the proverbial virtuality
of a Torrens title, it has been repeatedly held that, unless bad faith can be established on the
part of the person appearing as owner on the certificate of title, there is no other owner than
that in whose favor it has been issued. A Torrens title is not subject to collateral attack. It is a
well-known doctrine that a Torrens title, as a rule, is irrevocable and indefeasible, and the duty
of the court is to see to it that this title is maintained and respected unless challenged in a
direct proceedings [sic].6 (Citations omitted; underscoring supplied)
Before the Court of Appeals where respondents appealed, they argued that the trial court
erred:

1. . . . when it dismissed the complaint a quo . . . , in effect, sustaining the sale of the
subject property between Joseph, Sr. and the defendant-appellee, despite the
proliferation in the records and admissions by both parties that defendant-appellee was
the "mistress" or "common-law wife" of Joseph, Sr..

2. . . . when it dismissed the complaint a quo . . . , in effect, sustaining the sale of the
subject property between Joseph, Sr. and the defendant-appellee, despite the fact that
the marriage of Joseph, Sr. and Epifania was then still subsisting thereby rendering the
subject property as conjugal property of Joseph, Sr. and Epifania.

3. . . . in dismissing the complaint a quo . . . , in effect, sustaining the validity of the sale
of the subject property between Joseph, Sr. and the defendant-appellee, despite the
clear findings of forgery and the non-credible testimony of notary public.7

By Decision dated October 21, 2003,8 the appellate court reversed that of the trial court and
declared null and void the questioned deed of sale and TCT No. 138405. Held the appellate
court:

. . . The subject property having been acquired during the existence of a valid marriage between
Joseph Sr. and Epifania dela Cruz-Goyanko, is presumed to belong to the conjugal partnership.
Moreover, while this presumption in favor of conjugality is rebuttable with clear and convincing
proof to the contrary, we find no evidence on record to conclude otherwise. The record shows
that while Joseph Sr. and his wife Epifania have been estranged for years and that he and
defendant-appellant Maria Ching, have in fact been living together as common-law husband
and wife, there has never been a judicial decree declaring the dissolution of his marriage to
Epifania nor their conjugal partnership. It is therefore undeniable that the 661-square meter
property located at No. 29 F. Cabahug Street, Cebu City belongs to the conjugal partnership.

Even if we were to assume that the subject property was not conjugal, still we cannot sustain
the validity of the sale of the property by Joseph, Sr. to defendant-appellant Maria Ching, there
being overwhelming evidence on records that they have been living together as common-law
husband and wife. On this score, Art. 1352 of the Civil Code provides:

"Art. 1352. Contracts without cause, or with unlawful cause, produce no effect whatsoever. The
cause is unlawful if it is contrary to law, morals, good customs, public order or public policy."

We therefore find that the contract of sale in favor of the defendant-appellant Maria Ching was
null and void for being contrary to morals and public policy. The purported sale, having been
made by Joseph Sr. in favor of his concubine, undermines the stability of the family, a basic
social institution which public policy vigilantly protects. Furthermore, the law emphatically
prohibits spouses from selling property to each other, subject to certain exceptions. And this is
so because transfers or conveyances between spouses, if allowed during the marriage would
destroy the system of conjugal partnership, a basic policy in civil law. The prohibition was
designed to prevent the exercise of undue influence by one spouse over the other and is
likewise applicable even to common-law relationships otherwise, "the condition of those who
incurred guilt would turn out to be better than those in legal union.9 (Underscoring supplied)

Hence, the present petition, petitioners arguing that the appellate court gravely erred in:

I.
 . . . APPLYING THE STATE POLICY ON PROHIBITION AGAINST CONVEYANCES AND
TRANSFERS OF PROPERTIES BETWEEN LEGITIMATE AND COMMON LAW SPOUSES ON
THE SUBJECT PROPERTY, THE SAME BEING FOUND BY THE COURT A QUO, AS THE
EXCLUSIVE PROPERTY OF PETITIONER, AND THAT THE SAME WAS NEVER PART OF THE
CONJUGAL PROPERTY OF THE MARRIAGE BETWEEN RESPONDENTS’ MOTHER EPIFANIA
GOYANKO AND PETITIONER’S COMMON LAW HUSBAND, JOSEPH GOYANKO, SR., NOR
THE EXCLUSIVE OR CAPITAL PROPERTY OF THE LATTER AT ANYTIME BEFORE THE SAME
WAS VALIDLY ACQUIRED BY PETITIONER.

II.

. . . NOT FINDING THAT A JURIDICAL RELATION OF TRUST AS PROVIDED FOR UNDER

ARTICLES 1448 AND 1450 OF THE NEW CIVIL CODE CAN VALIDLY EXIST BETWEEN
COMMON LAW SPOUSES.

III.

. . . NOT FINDING THAT A CONVEYANCE OVER A PROPERTY MADE BY A TRUSTEE, WHO

BECAME AS SUCH IN CONTEMPLATION OF LAW, AND WHO HAPPENS TO BE A COMMON
LAW HUSBAND OF THE BENEFICIARY, IS NOT A VIOLATION OF A STATE POLICY ON
PROHIBITION AGAINST CONVEYANCES AND TRANSFERS OF PROPERTIES BETWEEN
LEGITIMATE AND COMMON LAW SPOUSES.

IV.

. . . ALLOWING RESPONDENTS TO ABANDON THEIR ORIGINAL THEORY OF THEIR CASE

DURING APPEAL.10

The pertinent provisions of the Civil Code which apply to the present case read:

ART. 1352. Contracts without cause, or with unlawful cause, produce no effect whatever. The
cause is unlawful if it is contrary to law, morals, good customs, public order or public policy.

ART. 1409. The following contracts are inexistent and void from the beginning:

(1) Those whose cause, object or purpose is contrary to law, morals, good customs,
public order or public policy;

(2) Those which are absolutely simulated or fictitious;

(3) Those whose cause or object did not exist at the time of the transaction;

(4) Those whose object is outside the commerce of men;

(5) Those which contemplate an impossible service;

(6) Those where the intention of the parties relative to the principal object of the
contract cannot be ascertained;

(7) Those expressly prohibited or declared void by law.

These contracts cannot be ratified. Neither can the right to set up the defense of illegality be
waived.
ARTICLE 1490. The husband and wife cannot sell property to each other, except:

(1) When a separation of property was agreed upon in the marriage settlements; or

(2) When there has been a judicial separation of property under Article 191.
(Underscoring supplied)

The proscription against sale of property between spouses applies even to common law
relationships. So this Court ruled in Calimlim-Canullas v. Hon. Fortun, etc., et al.:11

Anent the second issue, we find that the contract of sale was null and void for being contrary to
morals and public policy. The sale was made by a husband in favor of a concubine after he had
abandoned his family and left the conjugal home where his wife and children lived and from
whence they derived their support. The sale was subversive of the stability of the family, a
basic social institution which public policy cherishes and protects.

Article 1409 of the Civil Code states inter alia that: contracts whose cause, object, or purposes
is contrary to law, morals, good customs, public order, or public policy
are void and inexistent from the very beginning.

Article 1352 also provides that: "Contracts without cause, or with unlawful cause, produce no
effect whatsoever. The cause is unlawful if it is contrary to law, morals, good customs, public
order, or public policy."

Additionally, the law emphatically prohibits the spouses from selling property to each other
subject to certain exceptions.1âwphi1 Similarly, donations between spouses during marriage
are prohibited. And this is so because if transfers or conveyances between spouses were
allowed during marriage, that would destroy the system of conjugal partnership, a basic policy
in civil law. It was also designed to prevent the exercise of undue influence by one spouse over
the other, as well as to protect the institution of marriage, which is the cornerstone of family
law. The prohibitions apply to a couple living as husband and wife without benefit of
marriage, otherwise, "the condition of those who incurred guilt would turn out to be better
than those in legal union." Those provisions are dictated by public interest and their criterion
must be imposed upon the will of the parties. . . .12 (Italics in the original; emphasis and
underscoring supplied)

As the conveyance in question was made by Goyangko in favor of his common- law-wife-herein
petitioner, it was null and void.

Petitioner’s 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 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.

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 petitioner’s 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.

As to the change of theory by respondents from forgery of their father’s signature in the deed
of sale to sale contrary to public policy, it too does not persuade. Generally, a party in a
litigation is not permitted to freely and substantially change the theory of his case so as not to
put the other party to undue disadvantage by not accurately and timely apprising him of what
he is up against,13 and to ensure that the latter is given the opportunity during trial to refute all
allegations against him by presenting evidence to the contrary. In the present case, petitioner
cannot be said to have been put to undue disadvantage and to have been denied the chance to
refute all the allegations against her. For the nullification of the sale is anchored on its
illegality per se, it being violative of the above-cited Articles 1352, 1409 and 1490 of the Civil
Code.

WHEREFORE, the petition is DENIED for lack of merit.

Costs against petitioner.

SO ORDERED

CONCHITA CARPIO MORALES

Associate Justice

WE CONCUR:

LEONARDO A. QUISUMBING ANTONIO T. CARPIO

Associate Justice Associate Justice

DANTE O. TINGA* PRESBITERO J. VELASCO, JR.

Associate Justice Associate Justice

ATTESTATION

I attest that the conclusions in the above Decision were reached in consultation before the case
was assigned to the writer of the opinion of the Court’s Division.

LEONARDO A. QUISUMBING
Associate Justice
Chairperson

CERTIFICATION

Pursuant to Article VIII, Section 13 of the Constitution, and the Division Chairperson’s
Attestation, it is hereby certified that the conclusions in the above Decision were reached in
consultation before the case was assigned to the writer of the Court’s Division.

ARTEMIO V. PANGANIBAN
Chief Justice
Matabuena v. Cervantes [G.R. No. L-28771. March 31, 1971.]

CORNELIA MATABUENA, Plaintiff-Appellant, v. PETRONILA CERVANTES, Defendant-Appellee.

Alegre, Roces, Salazar & Sañez, for Plaintiff-Appellant.

Fernando Gerona, Jr., for Defendant-Appellee.

SYLLABUS

1. CIVIL LAW; PROPERTY RELATIONS BETWEEN HUSBAND AND WIFE; DONATIONS BY REASON
OF MARRIAGE; PROHIBITION AGAINST DONATION BETWEEN SPOUSES DURING MARRIAGE;
APPLICABLE TO COMMON LAW RELATIONSHIP. — While Art. 133 of the Civil Code considers as
void a "donation between the spouses during the marriage", policy considerations of the most
exigent character as well as the dictates of morality require that the same prohibition should
apply to a common-law relationship. A 1954 Court of Appeals decision Buenaventura v.
Bautista, (50 O.G. 3679) interpreting a similar provision of the old Civil Code speaks
unequivocally. If the policy of the law is, in the language of the opinion of the then Justice J.B.L.
Reyes of that Court, "to prohibit donations in favor of the other consort and his descendants
because of fear of undue and improper pressure and influence upon the donor, a prejudice
deeply rooted in our ancient law; ‘porque no se engañen despojandose el uno al otro por amor
que han de consuno,’ [according to] the Partidas (Part. IV, Tit. Xl, LAW IV), reiterating the
rationale ‘Ne mutuato amore invicem spoliarentur’ of the Pandects (Bk 24, Tit. I, De donat, inter
virum et uxorem); then there is every reason to apply the same prohibitive policy to persons
living together as husband and wife without benefit of nuptials. For it is not to be doubted that
assent to such irregular connection for thirty years bespeaks greater influence of one party over
the other, so that the danger that the law seeks to avoid is correspondingly increased.
Moreover, as already pointed out by Ulpian (in his lib. 32 ad Sabinum, fr. 1), it would not be just
that such donations should subsist lest the condition of those who incurred guilt should turn
out to be better. So long as marriage remains the cornerstone of our family law, reason and
morality alike demand that the disabilities attached to marriage should likewise attach to
concubinage.

2. ID.; SUCCESSION; INTESTATE SUCCESSION; SURVIVING SPOUSE; RULE WHERE A SISTER

SURVIVES WITH THE WIDOW. — The lack of validity of the donation made b~ the deceased to
defendant Petronila Cervantes does not necessarily result in plaintiff having exclusive right to
the disputed property. Prior to the death of Felix Matabuena, the relationship between him and
the defendant was legitimated by their marriage on March 28. 1962. She is therefore his
widow. As provided in the Civil Code, she is entitled to one-half of the inheritance and the
plaintiff, as the surviving sister to the other half.

DECISION

FERNANDO, J.:

A question of first impression is before this Court in this litigation. We are called upon to decide
whether the ban on a donation between the spouses during a marriage applies to a common-
law relationship. 1 The plaintiff, now appellant Cornelia Matabuena, a sister to the deceased
Felix Matabuena, maintains that a donation made while he was living maritally without benefit
of marriage to defendant, now appellee Petronila Cervantes, was void. Defendant would
uphold its validity. The lower court, after noting that it was made at a time before defendant
was married to the donor, sustained the latter’s stand. Hence this appeal. The question, as
noted, is novel in character, this Court not having had as yet the opportunity of ruling on it. A
1954 decision of the Court of Appeals, Buenaventura v. Bautista, 2 by the then Justice J. B. L.
Reyes, who was appointed to this Court later that year, is indicative of the appropriate
response that should be given. The conclusion reached therein is that a donation between
common-law spouses falls within the prohibition and is "null and void as contrary to public
policy." 3 Such a view merits fully the acceptance of this Court. The decision must be reversed.

In the decision of November 23, 1965, the lower court, after stating that in plaintiff’s complaint
alleging absolute ownership of the parcel of land in question, she specifically raised the
question that the donation made by Felix Matabuena to defendant Petronila Cervantes was null
and void under the aforesaid article of the Civil Code and that defendant on the other hand did
assert ownership precisely because such a donation was made in 1956 and her marriage to the
deceased did not take place until 1962, noted that when the case was called for trial on
November 19, 1965, there was stipulation of facts which it quoted. 4 Thus: "The plaintiff and
the defendant assisted by their respective counsels, jointly agree and stipulate: (1) That the
deceased Felix Matabuena owned the property in question; (2) That said Felix Matabuena
executed a Deed of Donation inter vivos in favor of Defendant, Petronila Cervantes over the
parcel of land in question on February 20, 1956, which same donation was accepted by
defendant; (3) That the donation of the land to the defendant which took effect immediately
was made during the common law relationship as husband and wife between the defendant-
done and the now deceased donor and later said donor and done were married on March 28,
1962; (4) That the deceased Felix Matabuena died intestate on September 13, 1962; (5) That
the plaintiff claims the property by reason of being the only sister and nearest collateral relative
of the deceased by virtue of an affidavit of self-adjudication executed by her in 1962 and had
the land declared in her name and paid the estate and inheritance taxes thereon’" 5

The judgment of the lower court on the above facts was adverse to plaintiff. It reasoned out
thus: "A donation under the terms of Article 133 of the Civil Code is void if made between the
spouses during the marriage. When the donation was made by Felix Matabuena in favor of the
defendant on February 20, 1956, Petronila Cervantes and Felix Matabuena were not yet
married. At that time they were not spouses. They became spouses only when they married on
March 28, 1962, six years after the deed of donation had been executed." 6

We reach a different conclusion. While Art. 133 of the Civil Code considers as void a "donation
between the spouses during the marriage," policy considerations of the most exigent character
as well as the dictates of morality require that the same prohibition should apply to a common-
law relationship. We reverse.

1. As announced at the outset of this opinion, a 1954 Court of Appeals decision, Buenaventura
v. Bautista, 7 interpreting a similar provision of the old Civil Code 8 speaks unequivocally. If the
policy of the law is, in the language of the opinion of the then Justice J.B.L. Reyes of that Court,
"to prohibit donations in favor of the other consort and his descendants because of fear of
undue and improper pressure and influence upon the donor, a prejudice deeply rooted in our
ancient law; ‘porque no se engañen despojandose el uno al otro por amor que han de consuno
[according to] the Partidas (Part IV, Tit. XI, LAW IV), reiterating the rationale ‘Ne mutuato amore
invicem spoliarentur’ of the Pandects (Bk. 24, Tit. 1, De donat, inter virum et uxorem); then
there is every reason to apply the same prohibitive policy to persons living together as husband
and wife without the benefit of nuptials. For it is not to be doubted that assent to such irregular
connection for thirty years bespeaks greater influence of one party over the other, so that the
danger that the law seeks to avoid is correspondingly increased. Moreover, as already pointed
out by Ulpian (in his lib. 32 ad Sabinum, fr. 1), ‘it would not be just that such donations should
subsist, lest the condition of those who incurred guilt should turn out to be better.’ So long as
marriage remains the cornerstone of our family law, reason and morality alike demand that the
disabilities attached to marriage should likewise attach to concubinage." 9

2. It is hardly necessary to add that even in the absence of the above pronouncement, any
other conclusion cannot stand the test of scrutiny. It would be to indict the framers of the Civil
Code for a failure to apply a laudable rule to a situation which in its essentials cannot be
distinguished. Moreover, if it is at all to be differentiated, the policy of the law which embodies
a deeply-rooted notion of what is just and what is right would be nullified if such irregular
relationship instead of being visited with disabilities would be attended with benefits. Certainly
a legal norm should not be susceptible to such a reproach. If there is ever any occasion where
the principle of statutory construction that what is within the spirit of the law is as much a part
of it as what is written, this is it. Otherwise the basic purpose discernible in such codal provision
would not be attained. Whatever omission may be apparent in an interpretation purely literal
of the language used must be remedied by an adherence to its avowed objective. In the
language of Justice Pablo: "El espiritu que informa la ley debe ser la luz que ha de guiar a los
tribunales en la aplicación de sus disposiciones.’’ 10

3. The lack of validity of the donation made by the deceased to defendant Petronila Cervantes
does not necessarily result in plaintiff having exclusive right to the disputed property. Prior to
the death of Felix Matabuena, the relationship between him and the defendant was legitimated
by their marriage on March 28, 1962. She is therefore his widow. As provided for in the Civil
Code, she is entitled to one-half of the inheritance and the plaintiff, as the surviving sister, to
the other half. 11

WHEREFORE, the lower court decision of November 23, 1965 dismissing the complaint with
costs is reversed. The questioned donation is declared void, with the rights of plaintiff and
defendant as pro indiviso heirs to the property in question recognized. The case is remanded to
the lower court for its appropriate disposition in accordance with the above opinion. Without
pronouncement as to costs.

Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Zaldivar, Castro, Barredo, Villamor and
Makasiar, JJ., concur.

Teehankee, J, took no part.

Endnotes:

1. Art 133 of the Civil Code provides: "Every donation between the spouses during the marriage
shall be void. This prohibition does not apply when the donation takes effect after the death of
the donor. Neither does this prohibition apply to moderate gifts which the spouses may give
each other on the occasion of any family rejoicing."cralaw virtua1aw library

2. 50 O.G. 3679 (1954).

3. Ibid., p. 3686.

4. Decision, Record on Appeal, pp. 17-19.

5. Ibid, pp. 19-20.

6. Ibid, p. 21.

7. 50 O.G. 3679.

8. Art. 1334 of the former Civil Code was similarly worded: "All donations between the spouses
made during the marriage shall be void."cralaw virtua1aw library

9. Buenaventura v. Bautista, 50 O.G. 3679, 3686 (1954).

10. The excerpt from Yellow Taxi and Pasay Trans. Workers Union v. Manila Yellow Taxicab Co.,
80 Phil. 833, 838 (1948) reads in full: "Esta interpretación de la ley es insostenible. El espiritu
que informa la ley debe ser la luz que ha de guiar a los tribunales en la aplicación de sus
dispociones. No deben atenerse a la letra de la ley cuando la interpretación literal se separa de
la intención de la legislatura especialmente cuando lleva a conclusiones incompatibles con
objeto manifesto de la ley. Cuando hay conflicto entre la interpretación literal y la
interpretación fundada en el proposito de la ley, la �ltima debe prevalecer." Cf. Tañada v.
Cuenco, 103 Phil, 1051 (1957); Hidalgo v. Hidalgo, L-25326-27, May 29, 1970, 33 SCRA 105;
Casela v. Court of Appeals, L-26754, Oct. 16, 1970, 35 SCRA 279.

11. According to Art. 1001 of the Civil Code: "Should brothers and sisters or their children
survive with the widow or widower, the latter shall be entitled to one-half of the inheritance
and the brothers and sisters or their children the other half. (953, 837a)."

Melchor v. COA G.R. No. 95398 August 16, 1991

MARIO R. MELCHOR, petitioner,

vs.
COMMISSION ON AUDIT, respondent.

Polistico Law Office for petitioner

GUTIERREZ, JR., J.:

Is the petitioner personally liable for the amout paid for the construction of a public school building on
the ground that the infrastructure contract is null and void for want of one signature?

The facts are uncontroverted.

On July 15, 1983, petitioner Mario R. Melchor, in his capacity as Vocational School Administrator of
Alangalang Agro-Industrial School of Alangalang, Leyte, entered into a contract with Cebu Diamond
Construction (hereinafter referred to as contractors for the construction of Phase I of the home
Technology Building of said school for the price of P488,000. Pablo Narido, (thief accountant of the
school, issued a certificate of availability of funds to cover the construction cost. Narido, however,
failed to sign as a Witness to the contract, contrarily to the requirement of Section I of Letter of
Instruction (LOI) No. 968.

The contract was approved by the then Minister of Education, Culture and Sports Onofre D. Corpuz.
The relevant parts of the contract are quoted below:

That for and in consideration of the sum of FOUR HUNDRED EIGHTY EIGHT THOUSAND
PESOS (P488,000.00), Philippine Currency, the CONTRACTOR, at his own proper cost and
expense willfully and faithfully perform all works, and unless otherwise provided, furnish all
labor, materials, equipment necessary for the construction and completion of Phase I of the
Home Technology Building for the Alangalang Agro-Industrial School of Alangalang, Leyte to
be completed in accordance with the plans and specifications and all terms, conditions and
 instructions contained in the general and special conditions of contract, as well as those
contained in the Notice to Bidders, Tenderers or Advertisement, Instruction to Bidders
Tenderers, Supplemental Specifications, Bond Articles, and other essential related
documents, which are made and acknowledged as Integral parts of this Agreement, by
reference and/or Incorporation, including the permission of Administrative Order No. 81 of
the President, dated January 17, 1964, ... (Rollo, p. 25)

While the construction of Phase I was under way, the contractor, in a letter dated November 8, 1983
addressed to Melchor, sought an additional charge of P73,000 equivalent to 15% of the stipulated
amount due to an increase in the cost of labor and construction materials.

In a letter dated November 17, 1983, the petitioner referred the contractor's request for additional
charge to the Regional Director, Ministry of Education, Culture and Sports (MECS). The petitioner in
said letter asked for approval of the contractor's additional charge, pointing out that such additional
charge shall be taken from the 1984 non-infrastructure capital outlay and part of the 1984
maintenance and operating expenses. The petitioner, in a second Indorsement dated November 22,
1983, requested the approval by the COA Regional Director in Tacloban City of the contractor's
request for adjustment of the cost of the contract.

In an Indorsement dated November 17, 1983, Servillano C. Dela Cruz, Acting Assistant Regional
Director ' MECS Regional Office No. VIII, Tacloban City, approved the contractor's request for
additional charge subject, however, to the availability of funds and the imprimatur of the Resident
Auditor of the School. On its part, the COA Regional Office No. VIII, Tacloban City, through Regional
Director, Sopronio Flores, Jr., advanced the view that "the approval of the police escalation rests on
the Minister or head of the agency concerned. Our participation in this regard shall be on the post-
audit of transactions as emphasized under COA Circular No. 82195."

Meanwhile, the contractor, anticipating that it could not meet the deadline for the project, requested
a series of extensions which the petitioner granted. However, on April 10, 1984, the contractor gave
up the project mainly to save itself from further losses due to, among other things, increased cost of
construction materials and labor.

At the time the contractor ceased working on the project, it had accomplished only 61% of the
construction work valued at P344,430.88. However, as of September 13, 1984, the contractor had
been paid the total amount of P515,305.60. The excess paid on the value of the 61%
accomplishment costing approximately P172,003.26 represented the extra work done by the
contractor which was found necessary.

Consequently, the petitioner wrote a letter dated September 19, 1984 to Ms. Gilda Ramos, COA
Resident Auditor of the school, requesting the latter to advise the former on whether to pursue
condoning the contract or institute a legal action for breach of contract against the contractor. In turn,
Ms. Ramos referred the matter to COA Regional Director in Tacloban City, Cesar A. Damole who in
a third Indorsement dated April 8, 1985, directed Ms. Ramos to disallow the payment of P515,305.60
in post-audit on the ground that the contract was null and void for lack of signature of the chief
accountant of the school as witness to it, as required under Section 1 of LOI 968, for which reason
the petitioner was made personally liable for the amount paid to the contractor.

On May 3, 1985, the petitioner wrote a letter addressed to the Regional Director, COA Regional
Office No. VIII, Tacloban City, seeking reconsideration of his directive to the Resident Auditor of the
school to disallow the payment of P515,305.60 to the contractor. The petitioner sought
reconsideration on the following grounds: a) the Certificate of Availability of Funds signed by the
chief accountant of the school, being an integral part, of the contract, substantially complied with the
requirement of LOI 968 that the signature of said accountant must be affixed as witness to the
contract, b) the petitioner did not exceed his authority because the contract was approved by the
head of the agency concerned c) the Resident Auditor of the school who had been furnished a copy
of the contract did not object to the contract because of that flaw; and d) the petitioner religiously
complied with the provisions of P.D. 1445 (otherwise known as "The Government Auditing Code of
the Phils."), specifically, Sections 85 and 86 as to the requirements in the execution of a government
contract.

In a first Indorsement dated July 17, 1985, COA Regional Director of Tacloban City, Cesar A.
Damole denied the petitioner's motion for reconsideration. Immediately, petitioner Melchor appealed
to the COA Head Office which dismissed his appeal for lack of merit. The COA Head Office likewise
denied the petitioner's requests for reconsideration.
Hence, this petition.

The sole issue of this Court's consideration is whether or not petitioner Melchor should be held
personally liable for the amount of P515,305.60 paid to the contractor. This P515,305.60 may be
broken down into:

1) P344,430.80 — representing 6l% of equivalent payment for the work done by the contractor within
the contract specifications, and

2) P172,003.206 — representing payment for extra work orders, not included in the contract
specifications, which were incurred to make the building structure strong.

The amounts of P344,430.80 and P172,003.26, when added together, do not equal P515,305.60.
The records do not explain the reason for the discrepancy. At any rate, the contending parties do not
question the correctness of these amounts.

Respondent COA maintains that the contract entered into by the petitioner with Cebu Diamond
Construction is null and void since the chief accountant did not affix his signature to the contract, in
violate on of the requirements of LOI 968.

Section 1 of LOI 968, dated December 17, 1979, provides:

1. All contracts for capital projects and for the supply of commodities and services, including
equipment, maintenance contracts., and other agreements requiring payments which are
chargeable to agency current operating or capital expenditure funds, shall be signed by
agency heads or other duly authorized official only when there are available funds. The Chief
Accountant of the contracting agency shall sign such contracts as witness and contracts
without such witness hall be considered as null and void.

According to COA, since there was no compliance with the above provision, then the amount of
P344,430.80 should be disallowed iii post-audit and the petitioner should be personally able for said
amount.

The petitioner reasons that the absence of the accountant's signature as witness to the contract
should not militate against its validity. He cites Section 86 of PD 1445, which states:

Certificate Showing Appropriation to Meet Contract — ... no contract involving the

expenditure of public fund by any government agency shall be entered into or authorized
unless the proper accounting official of the agency concerned shall have certified to the
officer entering into the obligation that funds have been duly appropriated for the purpose
and that the amount necessary to cover the proposed contract for the current fiscal year is
available for expenditure on account thereof, subject to verification, modification by the
auditor concerned. The certificate, signed by the proper accounting official and the, auditor
who verified it, shall be attached to and become an integral part of the proposed contract,
and the sum so certified shall not thereafter be available for expenditure for any other
purpose until the obligation of the government agency concerned under the contract is fully
extinguished.

Petitioner Melchor urges that the issuance by the chief accountant of a "Certificate of Availability of
Funds" compensates for the latter's non-signing as a contract witness since under Section 86 of PD
1445, the certificate is attached to and becomes an integral part of the contract. He argues that there
was, in effect, substantial compliance with the mandate of LOI 968.

Moreover the petitioner contends that assuming arguendo that the contract is null and void, he
should still not be made personally accountable for the amount paid to the contractor. He cites this
Court's resolution in Royal Trust Corporation v. Commission on Audit, G.R. No. 84202, November
22, 1988. In that case. despite the absence of a specific covering appropriation as required under
COA Resolution No. 86-58, the contractor was allowed by the Court to be compensated on a
quantum meruit basis.

Under the circumstances of this case, the Court finds that the contract executed by the petitioner
and Cebu Diamond Construction is enforceable and, therefore, the petitioner should not be made to
personally pay for the building already constructed.
LOI 968 and Sections 85 and 86 of PD 1445 implement and reinforce the constitutional mandate that
"No money shall be paid out of the Treasury except in pursuance of an appropriation made by law"
(Constitution, Article VI, Section 29 [1]).

Under Sections 85 and 86 of PD 1445, before a government agency can enter into a contract
involving expenditure of government funds there must be an appropriation for such expenditure and
the proper accounting official must certify that funds have been appropriated for the purpose. Under
LOI 968, the chief accountant of the government agency, as the verifier of the availability of funds,
must sign such contracts as witness. The uniform intent of these provisions is to ensure that
government contracts are signed only when supported by available funds.

In the case before us, the chief accountant issued a certificate of availability of funds but failed to
sign the contract as witness. But since Section 86 states that the certificate shall be attached to and
become an integral part of the proposed contract, then the failure of the chief accountant to affix his
signature to the contract was somehow made up by his own certification which is the basic and more
important validating document. The contract moreover provided that "other essential related
documents xxx are made and acknowledged as integral parts of this agreement, by reference and/or
incorporation." This is not to say that the heads of government offices or institutions should not read
carefully the fine print of official regulations governing contracts. However, under the peculiar
circumstances of this case, we agree with the petitioner's view that there was substantial compliance
with the requirements of LOI 968 in the execution of the contract. He has not been charged under
some regulations governing negligence in not going over auditing and accounting rules more
carefully. But even assuming some kind of administrative responsibility for not being more careful,
he should not be made to pay for a school building already constructed and serving an urgent need
in his province.

It is a rule of statutory construction that the court may consider the spirit and reason of a statute
where a literal meaning would lead to absurdity, contradiction, injustice or would defeat the clear
purpose of the lawmakers. (People v. Manantan 5 SCRA 684 [1962]) For this Court to draw a narrow
and stringent application of LOI 968 would be to lose sight of the purpose behind its enactment. The
rationale for LOI 968, which is to ensure that there are available funds to finance a proposed project,
was already served by the chief accountant's issuance of a certificate of fund availability.

Additionally, Section 2 of LOI 968 provides:

2. It shall be the responsibility of the Chief Accountant to verify the availability of funds, as
duly evidenced by programmed appropriations released by the Ministry of Budget and
received by the agency, from which such contract shall be ultimately payable. His signature
shall be considered as constituting a certification to that effect. (Emphasis Supplied)

Since, under the above proviso, the accountant's signature shall have the effect of a certification,
then it may be inferred that the accountant's certification, not his signature as a contract witness, is
the more reliable indicium of fund availability.

What further bolsters the contract's validity is the fact that the original contract for P488,000 and the
15% price escalation of P73,000 bore the approval of the Minister of Education, Culture and Sports
as required by COA Circular No. 83-101-J (dated June 8, 1983) and the Implementing Rules of PD
1594. Under COA Circular 83-101-J, the Minister of Education, Culture and Sports has the authority
to approve infrastructure projects not exceeding P2 Million. Under Section III, CIII of the
Implementing Rules of PD 1594, the Minister is empowered to approve contract price escalation not
exceeding 18% of the original contract price.

Moreover, under COA Circular No. 76-34 dated July 15,1976, within 5 days from receipt of a copy of
the contract, the COA is required to call the attention of management regarding defects or
deficiencies of the contract and suggest such corrective measures as are appropriate and warranted
to facilitate the process of the claim upon presentation. In this case, respondent COA does not deny
the petitioner's claim that it was furnished copies of the contract, together with supporting
documents, a few days after approval thereof by the Minister of Education, Culture and Sports. If the
respondent had complied with this requirement, then the absence of the accountant's signature as a
witness to the contract could have been remedied. COA was also negligent.

No less compelling than the foregoing reasons is the undisputed fact that the construction of the
Home Technology Building had long been completed and that the building is now being utilized as
part of the Alangalang Industrial School. In People v. Purisima 86 SCRA 542 (1978), we held that
there exists a valid presumption that undesirable consequences were never intended by a legislative
measure, and that a construction of which the statute is fairly susceptible is favored, which will avoid
all objectionable, mischievous, indefensible, wrongful, evil and injurious consequences. In the
present case we consider it highly inequitable to compel the petitioner, who had substantially
complied With the mandate of LOI 968, to shoulder the construction cost of the building when it is
not he, but the government, which is reaping benefits from it.

The Court therefore rules that respondent COA erred in disallowing in audit the amount of
P344,430.88.

With respect to the remaining P12,003.26 paid by the petitioner to the contractor for extra work
done, the COA reasons that the extra work done. being more than 25% of the escalated original
contract price, was null and void because no supplemental agreement was executed. The
respondent cites the implementing rules and regulations of PD 1594 which provide:

5. A separate supplemental agreement may be entered into for all change orders or extra
work orders if the aggregate amount exceeds 25% of the escalated original contract price.
(III CI paragraphs 5;) (Emphasis supplied).

Under the facts of this case, we adjudge that respondent COA is not without legal basis in
disallowing the P172,003.26 payment for the extra work orders. However, since the word "may" was
used in the Decree then the requirement of a supplemental agreement under all circumstances may
not always be mandatory. There is no need to go into any possible exceptions because we find the
rule applicable in this case.

Under COA Circular 83-101-J, supra, the Minister of Education, Culture and Sports has the authority
to approve extra work orders or other variation orders not exceeding 50% of the original contract
price or P1 Million whichever is less. In this case, there is no showing that the extra work order was
approved by the Minister.

Moreover, a variation order (which may take the form of a change order, extra work or supplemental
agreement) is a contract by itself and involves the expenditure of public funds to cover the cost of
the work called for thereunder. (Fernandez, A Treatise on Government Contracts under Philippine
Law, 115-116 [1985]) As such, it is subject to the restrictions imposed by Sections 85 and 86 of PD
1445 and LOI 968-COA Circular No. 80-122, dated January 15, 1980, likewise ensures that an extra
work order is approved only when supported by available funds. Again, the petitioner has not
presented proof of an appropriation to cover the extra work order.

For a failure to show the approval by the proper authority and to submit the corresponding
appropriation, We declare the contract for extra works null and void. Section 87 of PD 1445 states:

Any contract entered into contrary to the requirements of the two immediately preceding
sections shall be void, and the officer or offices entering into the contract shall be liable to the
government or other contracting party for any consequent damage to the same extent as if
the transaction had been wholly between private parties. (Emphasis supplied)

This does not mean, however, that the petitioner should be held personally liable and automatically
ordered to return to the government the full amount of P172,003.26.

As previously discussed, it would be unjust to Order the petitioner to shoulder the expenditure when
the government had already received and accepted benefits from the utilization of the building.

In Royal Trust Construction v. Commission on Audit, supra, cited by the petitioner, the Court, in the
interest of substantial justice and equity, allowed payment to the contractor on a quantum
meruit basis despite the absence of a written contract and a covering appropriation.

In a more recent case, Dr. Rufino O. Eslao v. Commission on Audit, G.R. No. 89745, April 8, 1991,
the Court directed payment to the contractor on a quantum meruit basis despite the petitioner's
failure to undertake a public bidding. In that case, the Court held that "to deny payment to the
contractor of the two buildings which are almost fully completed and presently occupied by the
university would be to allow the government to unjustly enrich itself at the expense of another. 1âwphi 1
Where payment is based on quantum meruit the amount of recovery would only be the reasonable
value of the thing or services rendered regardless of any agreement as to value. (Tantuico, State
Audit Code of the Philippines Annotated, 471 [1982])

Although the two cases mentioned above contemplated a situation where it is the contractor who is
seeking recovery, we find that the principle of payment by quantum meruit likewise applies to this
case where the contractor had already been paid and the government is seeking reimbursement
from the public official who heads the school. If, after COA determines the value of the extra works
computed on the basis of quantum meruit it finds that the petitioner made an excess or improper
payment for these extra works, then petitioner Melchor shall be liable only for such excess payment.

WHEREFORE, the petition is GRANTED. The decision of the respondent COA denominated as 11th
Indorsement dated November 11, 1988 and its resolution dated July 31, 1990 are hereby
REVERSED and SET ASIDE. Respondent COA is directed to allow in post-audit the payment of
P344,430.80. Respondent COA is likewise directed to determine on a quantum meruit basis the
value of the extra works done, and after such determination, to disallow in post-audit the excess
payment, if any, made by the petitioner to the contractor. The petitioner shall be personally liable for
any such excess payment.

SO ORDERED.

Fernan, C.J., Narvasa, Melencio-Herrera, Cruz, Paras, Feliciano, Gancayco, Padilla, Bidin,
Sarmiento, Griño-Aquino, Medialdea, Regalado and Davide, Jr., JJ., concur.

Tomas v. Tomas G.R. No. L-36897 June 26, 1980

SPOUSES FLORENTINO S. TOMAS and FRANCISCA CARIÑO, plaintiffs-appellees,

vs.
EUSEBIA TOMAS, defendant, PHILIPPINE NATIONAL BANK, SANTIAGO, ISABELA
BRANCH, defendant-appellant.

DE CASTRO, J.:

Plaintiff spouses, Florentino S. Tomas and Francisca Cariño, are the owners of a parcel of land
located in Malasian, Santiago, Isabela (now Saguday, Nueva Vizcaya) since 1929, which they
obtained through a homestead patent with Original Certificate of Title No. I-4620. Through fraud and
misrepresentation, one Eusebia Tomas succeeded in having OCT No. I-4620 cancelled, and
obtained in her name TCT No. 8779, Isabela now TCT-350 Nueva Vizcaya, with which she
obsessed a loan from the Philippine National Bank branch in Santiago, Isabela, as a security,
mortgaging the land with the bank for the load of P2,500.00. Florentino Tomas discovered the
fraudulent acts of Eusebia Tomas when he himself applied for a loan from the Philippine National
Bank, and offered as a collateral the same land already mortgaged by Eusebia Tomas to the bank.

In the action plaintiffs filed on April 14, 1964 to declare TCT-350, Nueva Vizcaya, null and void,
against Eusebia Tomas, it was found by the court (Court of First Instance of Nueva Vizcaya) that
Eusebia Tomas succeeded in having plaintiffs' OCT No. I-4620 (Isabela)1 cancelled and having TCT
No. 8779 (Isabela) 2 issued in her name, by executing a deed of extra-judicial settlement 3 in which
she made it appear that she is the lone heir of the registered owner, Florentino Tomas, to whom she
was not even known before, and who was at the time very much alive. She then petitioned for the
issuance of another owner's duplicate of OCT No. I-4620, alleging loss of said owner's duplicate. On
Order of the court (Court of First Instance of Isabela) where the petition was filed, a new owner's
duplicate was issued to Eusebia Tomas as the petitioner. Upon the registration of the deed of extra-
judicial settlement (Exhibit "J" OCT No. I-4620 was cancelled, and TCT No. 8779, now TCT-350
Nueva Vizcaya was issued in the name of Eusebia Tomas on March 14,1957.

In the same action, the Philippine National Bank was made a co-defendant as the mortgagee of the
land, the plaintiffs alleging that the mortgage is null and void, the mortgagor not being the owner of
the property mortgaged. After trial in which Eusebia Tomas never appeared to present any evidence,
the court a quo rendered judgment dated June 9, 1967, the dispositive portion 4 of which reads:

IN VIEW OF ALL THE FOREGOING CONSIDERATIONS, decision is hereby

rendered in favor of the plaintiffs and against the defendants: (a) declaring transfer
Certificate of Title No. T-8779, now Transfer Certificate of Title No. T-350 in the
name of defendant Eusebia Tomas null and void; (b) declaring the deed of extra-
judicial settlement executed by defendant Eusebia Tomas null and void, (c) declaring
Original Certificate of Title No. I-4620 and its file and owner's copy revived (d)
condemning defendant Eusebia Tomas to pay the plaintiffs in the amount of P950.00
as attorney's fee and P 55.80 representing the actual expenses of the plaintiffs; (e)
declaring the mortgage in favor of the Philippine National Bank without force and
effect against the plaintiffs, and ordering defendant Eusebia Tomas to pay the costs
of this proceedings.

From the portion of the foregoing judgment declaring the mortgage, in its favor without force and
effect, the Philippine National Bank appealed to the Court of Appeals, 5 which, however, certified the
appeal to this Court, this issue presented being purely legal. 6

The only issue to be resolved is whether the mortgage of the land in favor of the appellant bank is
valid or not as against appellees.

There is no dispute that the mortgagor Eusebia Tomas is not the owner of the land in question, the
true owner being the appellees, who had always been in possession of said land since they applied
for it by way of homestead patent. The owner's duplicate of OCT No. I-4620 covering the land in
favor of appellee Florentino Tomas had always been with the latter, and was never lost as falsely
and fraudulently misrepresented by Eusebia Tomas in her petition for a new owner's duplicate of
OCT No. I-4620. Alleging however, good faith so as to invoke the protective provision of the Land
Registration Act (Section 39, Act 496), pointing to the fact that the certificate of title, TCT-350 Nueva
Vizcaya presented by Eusebia Tomas as mortgagor was in her name, and showed no encumbrance
over the land, the appellant bank contends that its right as mortgagee must be fully rated as a
mortgagee in good faith.

Verily, the resolution of the issue raised in this appeal hinges on whether the appellant is a
mortgagee in good faith and for value, for if it is, and without anything to excite suspension as it
claims, it is protected in the same way as a purchaser in good faith and for value is protected under
Section 39 of Act 496, otherwise known as the Land Registration Act.

In claiming good faith as a mortgagee, and for value, appellant bank claims that no proof to the
contrary was presented by appellees in the trial court. 7 It is a fact, however, that incontrovertible
proofs have seen adduced showing that Eusebia Tomas, the mortgagor, was not the owner of the
property mortgaged. This is an that appellees had to prove that would place appellant bank on
obligation to show good faith, as in fact, it was the bank that alleged good faith as its defense. 8 It
would be more legally correct, therefore, to say that it was incumbent on appellant to prove its
affirmative allegation of good faith rather than appellee to show the contrary. In any case, to the
statement in appellees' brief that appellant bank "did not object when appellees presented evidence
in the lower court regarding negligence of appellant, like their failure to send field inspector to the
land to discover who is the real owner of the land being offered as Atty. to the loan of impostor
Eusebia Tomas," no denial was made in a reply brief which appellant should have filed if it wanted to
deny this assertion of appellees. The allegation that appellate presented no proof of lack of good
faith on the part of appellant bank may, therefore, not altogether be accurate.

The facts as properly taken note of by the lower court would seem to bring the instant case within
the ruling of the case of Pichay vs. Celestino, 9 the essence of which is as between two innocent
persons, the mortgagee and the owner of the mortgaged property, one of whom must suffer the
consequence of a breach of trust, the one who made it possible by his act of confidence must bear
the loss. This is a principle that accords more with justice and equity, in the light of the common
practice of banking institution, which is a matter of public knowledge, as observed by the trial court in
the case aforecited, with which this Court agreed, before approving a loan, to send representatives
to the premises of the land offered as collateral and investigate who are the true owners thereof.
Incidentally, the ruling cited herein was against the same appellant bank, the Philippine National
Bank, with reference to a mortgage entered into under solar circumstances. Banks, indeed, should
exercise more care and prudence in dealing even with registered lands, than private individuals, for
their business is one affected with public interest, keeping in trust money belonging to their
depositors, which they should guard against loss by not committing any act of negligence which
amount to lack of good faith by which they would be denied the protective mantle of the land
registration statute, Act 496, extended only to purchasers for value and in good faith, as well as to
mortgagees of the same character and description. This is evidently the rationale of the doctrine laid
down in the case of Pichay vs. Celestino, supra, which as in the instant suit, involved also a
mortgage of a land covered by a certificate of title, mortgaged by the defendant who was not the
owner. The latter, however, succeeded in cancelling the original certificate of title in the name of the
real owner, by forging a deed of sale, purportedly executed by the said registered owner in his favor,
upon the registration of which, he obtained a transfer certificate of title in his name, presenting a new
owner's duplicate certificate he obtained by falsely alleging that the first owner's duplicate was
burned in an ex-parte petition with prayer for the issuance of another owner's duplicate which the
court granted.

Thus, the facts of the instant case so closely resemble, if they are not exactly the same as, those in
the Pichay vs. Celestino case, as to make the application of the ruling in said case to the one at bar
unavoidable and compelling. There were only 12 days between the cancellation of OCT No. I-4620
on March 14, 1957 and the constitution of the mortgage on March 26, 1957, which shows that the
application for the loan must have been filed within days only from the receipt of the new TCT No.
8779 by Eusebia Tomas. This fact should have aroused suspicion for appellant bank to send
representative to the premises to ascertain who the true owner is, considering that homestead
patents are generally applied for by male appellant applicants, and are very infrequently sold or
alienated, the policy of the law being against sale or alienation.

The decision of this Court in the aforecited case promulgated on May 30, 1967 preceded the
decision of the lower court in this case dated June 7, 1967, by only a few days. However, the court a
quo went along the doctrine as laid down in the Pichay vs. Celestino case even perhaps without
having actually read the decision, although a similar rule had earlier been laid down in Blondeau, et
al. vs. Nano, et al. 10 We, therefore, find no error in the holding of the court a quo that the mortgage
executed by Eusebia Tomas, appellant's codefendant in favor of said appellant bank over the land in
question which the former never owned, is without effect as against appellees herein.

We, indeed, find more weight and vigor in a doctrine which recognizes a better right for the innocent
original registered owner who obtained his certificate of title through perfectly legal and regular
proceedings, than one who obtains his certificate from a totally void one, as to prevail over judicial
pronouncements to the effect that one dealing with a registered land, such as a purchaser, is under
no obligation to look beyond the certificate of title of the vendor, for in the latter case, good faith has
yet to be established by the vendee or transferee, being the most essential condition, coupled with
valuable consideration, to entitle him to respect for his newly acquired title even as against the
holder of an earlier and perfectly valid title. There might be circumstances apparent on the face of
the certificate of title which could excite suspicion as to prompt inquiry, such as when the transfer is
not by virtue of a voluntary act of the original registered owner, as in the instant case, where it was
by means of a self-executed deed of extra-judicial settlement, a fact which should be noted on the
face of Eusebia Tomas' certificate of title. Failing to make such inquiry would hardly be consistent
with any pretense of good faith, which the appellant bank invokes to claim the right to be protected
as a mortgagee, and for the reversal of the judgment rendered against it by the lower court.

WHEREFORE, the judgement appealed from is hereby affirmed, without pronouncement to cost.

SO ORDERED.

Teehankee (Chairman),Makasiar and Fernandez, JJ., concur.

Melencio-Herrera J., concurs in the result.

Guerrero, J., took no part.

Vda. De Ape v. CA

PERPETUA VDA. DE APE, petitioner, vs. THE HONORABLE COURT

OF APPEALS and GENOROSA CAWIT VDA. DE
LUMAYNO, respondents.

DECISION
CHICO-NAZARIO, J.:

Before Us is a petition for review on certiorari of the Decision[1] of the Court of

Appeals in CA-G.R. CV No. 45886 entitled, Generosa Cawit de Lumayno, accompanied
by her husband Braulio Lumayno v. Fortunato Ape, including his wife Perpetua de Ape.
The pertinent facts are as follows:
Cleopas Ape was the registered owner of a parcel of land particularly known as Lot
No. 2319 of the Escalante Cadastre of Negros Occidental and covered by Original
Certificate of Title (OCT) No. RP 1379 (RP-154 [300]).[2] Upon Cleopas Apes death
sometime in 1950, the property passed on to his wife, Maria Ondoy, and their eleven
(11) children, namely: Fortunato, Cornelio, Bernalda, Bienvenido, Encarnacion, Loreta,
Lourdes, Felicidad, Adela, Dominador, and Angelina, all surnamed Ape.
On 15 March 1973, Generosa Cawit de Lumayno (private respondent herein),
joined by her husband, Braulio,[3] instituted a case for Specific Performance of a Deed of
Sale with Damages against Fortunato and his wife Perpetua (petitioner herein) before
the then Court of First Instance of Negros Occidental. It was alleged in the complaint
that on 11 April 1971, private respondent and Fortunato entered into a contract of sale
of land under which for a consideration of P5,000.00, Fortunato agreed to sell his share
in Lot No. 2319 to private respondent. The agreement was contained in a receipt
prepared by private respondents son-in-law, Andres Flores, at her behest. Said receipt
was attached to the complaint as Annex A thereof and later marked as Exhibit G for
private respondent. The receipt states:

April 11, 1971

TO WHOM IT MAY CONCERN:

This date received from Mrs. Generosa Cawit de Lumayno the sum of THIRTY
PESOS ONLY as Advance Payment of my share in Land Purchased, for FIVE
THOUSAND PESOS LOT #2319.

(Signed)

FORTUNATO APE

P30.00 WITNESS:
(Illegible) [4]
As private respondent wanted to register the claimed sale transaction, she
supposedly demanded that Fortunato execute the corresponding deed of sale and to
receive the balance of the consideration. However, Fortunato unjustifiably refused to
heed her demands. Private respondent, therefore, prayed that Fortunato be ordered to
execute and deliver to her a sufficient and registrable deed of sale involving his one-
eleventh (1/11) share or participation in Lot No. 2319 of the Escalante Cadastre; to pay
P5,000.00 in damages; P500.00 reimbursement for litigation expenses as well as
additional P500.00 for every appeal made; P2,000.00 for attorneys fees; and to pay the
costs.[5]
 Fortunato and petitioner denied the material allegations of the complaint and
claimed that Fortunato never sold his share in Lot No. 2319 to private respondent and
that his signature appearing on the purported receipt was forged. By way of
counterclaim, the defendants below maintained having entered into a contract of lease
with respondent involving Fortunatos portion of Lot No. 2319. This purported lease
contract commenced in 1960 and was supposed to last until 1965 with an option for
another five (5) years. The annual lease rental was P100.00 which private respondent
and her husband allegedly paid on installment basis. Fortunato and petitioner also
assailed private respondent and her husbands continued possession of the rest of Lot
No. 2319 alleging that in the event they had acquired the shares of Fortunatos co-
owners by way of sale, he was invoking his right to redeem the same. Finally, Fortunato
and petitioner prayed that the lease contract between them and respondent be ordered
annulled; and that respondent be ordered to pay them attorneys fees; moral damages;
and exemplary damages.[6]
In their reply,[7] the private respondent and her husband alleged that they had
purchased from Fortunatos co-owners, as evidenced by various written
instruments,[8]their respective portions of Lot No. 2319. By virtue of these sales, they
insisted that Fortunato was no longer a co-owner of Lot No. 2319 thus, his right of
redemption no longer existed.
Prior to the resolution of this case at the trial court level, Fortunato died and was
substituted in this action by his children named Salodada, Clarita, Narciso, Romeo,
Rodrigo, Marieta, Fortunato, Jr., and Salvador, all surnamed Ape.[9]
During the trial, private respondent testified that she and her husband acquired the
various portions of Lot No. 2319 belonging to Fortunatos co-owners. Thereafter, her
husband caused the annotation of an adverse claim on the certificate of title of Lot No.
2319.[10] The annotation states:

Entry No. 123539 Adverse claim filed by Braulio Lumayno. Notice of adverse claim
filed by Braulio Lumayno affecting the lot described in this title to the extent of
77511.93 square meters, more or less, the aggregate area of shares sold to him on the
basis of (alleged) sales in his possession. Doc. No. 157, Page No. 33, Book No. XI,
Series of 1967 of Alexander Cawit of Escalante, Neg. Occ. Date of instrument. June
22, 1967 at 8:30 a.m. (SGD) FEDENCIORRAZ, Actg. Register of Deeds.[11]

In addition, private respondent claimed that after the acquisition of those shares,
she and her husband had the whole Lot No. 2319 surveyed by a certain Oscar Mascada
who came up with a technical description of said piece of land.[12]Significantly, private
respondent alleged that Fortunato was present when the survey was conducted. [13]
Also presented as evidence for private respondent were pictures taken of some
parts of Lot No. 2319 purportedly showing the land belonging to Fortunato being
bounded by a row of banana plants thereby separating it from the rest of Lot No.
2319.[14]
As regards the circumstances surrounding the sale of Fortunatos portion of the
land, private respondent testified that Fortunato went to her store at the time when their
lease contract was about to expire. He allegedly demanded the rental payment for his
land but as she was no longer interested in renewing their lease agreement, they
agreed instead to enter into a contract of sale which Fortunato acceded to provided
private respondent bought his portion of Lot No. 2319 for P5,000.00. Thereafter, she
asked her son-in-law Flores to prepare the aforementioned receipt. Flores read the
document to Fortunato and asked the latter whether he had any objection thereto.
Fortunato then went on to affix his signature on the receipt.
For her part, petitioner insisted that the entire Lot No. 2319 had not yet been
formally subdivided;[15] that on 11 April 1971 she and her husband went to private
respondents house to collect past rentals for their land then leased by the former,
however, they managed to collect only thirty pesos;[16] that private respondent made her
(petitioners) husband sign a receipt acknowledging the receipt of said amount of
money;[17] and that the contents of said receipt were never explained to them. [18] She
also stated in her testimony that her husband was an illiterate and only learned how to
write his name in order to be employed in a sugar central. [19] As for private respondents
purchase of the shares owned by Fortunatos co-owners, petitioner maintained that
neither she nor her husband received any notice regarding those sales
transactions.[20] The testimony of petitioner was later on corroborated by her daughter-
in-law, Marietta Ape Dino.[21]
After due trial, the court a quo rendered a decision[22] dismissing both the complaint
and the counterclaim. The trial court likewise ordered that deeds or documents
representing the sales of the shares previously owned by Fortunatos co-owners be
registered and annotated on the existing certificate of title of Lot No. 2319. According to
the trial court, private respondent failed to prove that she had actually paid the purchase
price of P5,000.00 to Fortunato and petitioner. Applying, therefore, the provision of
Article 1350 of the Civil Code,[23] the trial court concluded that private respondent did not
have the right to demand the delivery to her of the registrable deed of sale over
Fortunatos portion of the Lot No. 2319.
The trial court also rejected Fortunato and petitioners claim that they had the right of
redemption over the shares previously sold to private respondent and the latters
husband, reasoning as follows:

Defendants in their counterclaim invoke their right of legal redemption under Article
1623 of the New Civil Code in view of the alleged sale of the undivided portions of
the lot in question by their co-heirs and co-owners as claimed by the plaintiffs in their
complaint. They have been informed by the plaintiff about said sales upon the filing
of the complaint in the instant case as far back as March 14, 1973. Defendant
themselves presented as their very own exhibits copies of the respective deeds of sale
or conveyance by their said co-heirs and co-owners in favor of the plaintiffs or their
predecessors-in-interest way back on January 2, 1992 when they formally offered
their exhibits in the instant case; meaning, they themselves acquired possession of
said documentary exhibits even before they formally offered them in evidence. Under
Art. 1623 of the New Civil Code, defendants have only THIRTY (30) DAYS counted
from their actual knowledge of the exact terms and conditions of the deeds of sale or
conveyance of their co-heirs and co-owners share within which to exercise their right
of legal redemption.[24]

Within the reglementary period, both parties filed their respective notices of appeal
before the trial court with petitioner and her children taking exception to the finding of
the trial court that the period within which they could invoke their right of redemption had
already lapsed.[25] For her part, private respondent raised as errors the trial courts ruling
that there was no contract of sale between herself and Fortunato and the dismissal of
their complaint for specific performance.[26]
The Court of Appeals, in the decision now assailed before us, reversed and set
aside the trial courts dismissal of the private respondents complaint but upheld the
portion of the court a quos decision ordering the dismissal of petitioner and her
childrens counterclaim. The dispositive portion of the appellate courts decision reads:

WHEREFORE, the decision dated March 11, 1994, is hereby REVERSED and SET
ASIDE insofar as the dismissal of plaintiffs-appellants complaint is concerned, and
another one is entered ordering the defendant-appellant Fortunato Ape and/or his wife
Perpetua de Ape and successors-in-interest to execute in favor of plaintiff-appellant
Generosa Cawit de Lumayno a Deed of Absolute Sale involving the one-eleventh
(1/11) share or participation of Fortunato Ape in Lot No. 2319, Escalante Cadastre,
containing an area of 12,527.19 square meters, more or less, within (30) days from
finality of this decision, and in case of non-compliance with this Order, that the Clerk
of Court of said court is ordered to execute the deed on behalf of the vendor. The
decision is AFFIRMED insofar as the dismissal of defendants-appellants counterclaim
is concerned.

Without pronouncement as to costs.[27]

The Court of Appeals upheld private respondents position that Exhibit G had all the
earmarks of a valid contract of sale, thus:

Exhibit G is the best proof that the P5,000.00 representing the purchase price of the
1/11th share of Fortunato Ape was not paid by the vendee on April 11, 1971, and/or up
to the present, but that does not affect the binding force and effect of the document.
The vendee having paid the vendor an advance payment of the agreed purchase price
of the property, what the vendor can exact from the vendee is full payment upon his
execution of the final deed of sale. As is shown, the vendee precisely instituted this
action to compel the vendor Fortunato Ape to execute the final document, after she
was informed that he would execute the same upon arrival of his daughter Bala from
Mindanao, but afterwards failed to live up to his contractual obligation (TSN, pp. 11-
13, June 10, 1992).

It is not right for the trial court to expect plaintiff-appellant to pay the balance of the
purchase price before the final deed is executed, or for her to deposit the equivalent
amount in court in the form of consignation. Consignation comes into fore in the case
of a creditor to whom tenderof payment has been made and refuses without just cause
to accept it (Arts. 1256 and 1252, N.C.C.; Querino vs. Pelarca, 29 SCRA 1). As
vendee, plaintiff-appellant Generosa Cawit de Lumayno does not fall within the
purview of a debtor.

We, therefore, find and so hold that the trial court should have found that exhibit G
bears all the earmarks of a private deed of sale which is valid, binding and enforceable
between the parties, and that as a consequence of the failure and refusal on the part of
the vendor Fortunato Ape to live up to his contractual obligation, he and/or his heirs
and successors-in-interest can be compelled to execute in favor of, and to deliver to
the vendee, plaintiff-appellant Generosa Cawit de Lumayno a registerable deed of
absolute sale involving his one-eleventh (1/11th) share or participation in Lot No.
2319, Escalante Cadastre, containing an area of 12,527.19 square meters, more or less,
within 30 days from finality of this decision, and, in case of non-compliance within
said period, this Court appoints the Clerk of Court of the trial court to execute on
behalf of the vendor the said document.[28]

The Court of Appeals, however, affirmed the trial courts ruling on the issue of
petitioner and her childrens right of redemption. It ruled that Fortunatos receipt of the
Second Owners Duplicate of OCT (RP) 1379 (RP-154 ([300]), containing the adverse
claim of private respondent and her husband, constituted a sufficient compliance with
the written notice requirement of Article 1623 of the Civil Code and the period of
redemption under this provision had long lapsed.
Aggrieved by the decision of the appellate court, petitioner is now before us raising,
essentially, the following issues: whether Fortunato was furnished with a written notice
of sale of the shares of his co-owners as required by Article 1623 of the Civil Code; and
whether the receipt signed by Fortunato proves the existence of a contract of sale
between him and private respondent.
In her memorandum, petitioner claimed that the Court of Appeals erred in sustaining
the court a quos pronouncement that she could no longer redeem the portion of Lot No.
2319 already acquired by private respondent for no written notice of said sales was
furnished them. According to her, the Court of Appeals unduly expanded the scope of
the law by equating Fortunatos receipt of Second Owners Duplicate of OCT (RP) 1379
(RP-154 ([300]) with the written notice requirement of Article 1623. In addition, she
argued that Exhibit G could not possibly be a contract of sale of Fortunatos share in Lot
No. 2319 as said document does not contain (a) definite agreement on the manner of
payment of the price.[29] Even assuming that Exhibit G is, indeed, a contract of sale
between private respondent and Fortunato, the latter did not have the obligation to
deliver to private respondent a registrable deed of sale in view of private respondents
own failure to pay the full purchase price of Fortunatos portion of Lot No. 2319.
Petitioner is also of the view that, at most, Exhibit G merely contained a unilateral
promise to sell which private respondent could not enforce in the absence of a
consideration distinct from the purchase price of the land. Further, petitioner reiterated
her claim that due to the illiteracy of her husband, it was incumbent upon private
respondent to show that the contents of Exhibit G were fully explained to him. Finally,
petitioner pointed out that the Court of Appeals erred when it took into consideration the
same exhibit despite the fact that only its photocopy was presented before the court.
On the other hand, private respondent argued that the annotation on the second
owners certificate over Lot No. 2319 constituted constructive notice to the whole world
of private respondents claim over the majority of said parcel of land. Relying on our
decision in the case of Cabrera v. Villanueva,[30] private respondent insisted that when
Fortunato received a copy of the second owners certificate, he became fully aware of
the contracts of sale entered into between his co-owners on one hand and private
respondent and her deceased husband on the other.
Private respondent also averred that although (Lot No. 2319) was not actually
partitioned in a survey after the death of Cleopas Ape, the land was partitioned in
a hantal-hantal manner by the heirs. Each took and possessed specific portion or
premises as his/her share in land, farmed their respective portion or premises, and
improved them, each heir limiting his/her improvement within the portion or premises
which were his/her respective share.[31] Thus, when private respondent and her
husband purchased the other parts of Lot No. 2319, it was no longer undivided as
petitioner claims.
The petition is partly meritorious.
Article 1623 of the Civil Code provides:

The right of legal pre-emption or redemption shall not be exercised except within
thirty days from the notice in writing by the prospective vendor, or by the vendor, as
the case may be. The deed of sale shall not be recorded in the Registry of Property,
unless accompanied by an affidavit of the vendor that he has given written notice
thereof to all possible redemptioners.

Despite the plain language of the law, this Court has, over the years, been tasked to
interpret the written notice requirement of the above-quoted provision. In the case Butte
v. Manuel Uy & Sons, Inc.,[32] we declared that

In considering whether or not the offer to redeem was timely, we think that the notice
given by the vendee (buyer) should not be taken into account. The text of Article 1623
clearly and expressly prescribes that the thirty days for making the redemption are to
be counted from notice in writing by the vendor. Under the old law (Civ. Code of
1889, Art. 1524), it was immaterial who gave the notice; so long as the redeeming co-
owner learned of the alienation in favor of the stranger, the redemption period began
to run. It is thus apparent that the Philippine legislature in Article 1623 deliberately
selected a particular method of giving notice, and that method must be deemed
exclusive. (39 Am. Jur., 237; Payne vs. State, 12 S.W. 2(d) 528). As ruled in Wampler
vs. Lecompte, 150 Atl. 458 (affd. in 75 Law Ed. [U.S.] 275)

why these provisions were inserted in the statute we are not informed, but we may
assume until the contrary is shown, that a state of facts in respect thereto existed,
which warranted the legislature in so legislating.

The reasons for requiring that the notice should be given by the seller, and not by the
buyer, are easily divined. The seller of an undivided interest is in the best position to
know who are his co-owners that under the law must be notified of the sale. Also, the
notice by the seller removes all doubts as to fact of the sale, its perfection; and its
validity, the notice being a reaffirmation thereof, so that the party notified need not
entertain doubt that the seller may still contest the alienation. This assurance would
not exist if the notice should be given by the buyer.[33]

The interpretation was somehow modified in the case of De Conejero, et al. v. Court
of Appeals, et al.[34] wherein it was pointed out that Article 1623 does not prescribe a
particular form of notice, nor any distinctive method for notifying the redemptioner thus,
as long as the redemptioner was notified in writing of the sale and the particulars
thereof, the redemption period starts to run. This view was reiterated in Etcuban v. The
Honorable Court of Appeals, et al.,[35] Cabrera v. Villanueva,[36]Garcia, et al. v.
Calaliman, et al.,[37] Distrito, et al. v. The Honorable Court of Appeals, et al., [38] and
Mariano, et al. v. Hon. Court of Appeals, et al.[39]
However, in the case of Salatandol v. Retes,[40] wherein the plaintiffs were not
furnished any written notice of sale or a copy thereof by the vendor, this Court again
referred to the principle enunciated in the case of Butte. As observed by Justice Vicente
Mendoza, such reversion is only sound, thus:

Art. 1623 of the Civil Code is clear in requiring that the written notification should
come from the vendor or prospective vendor, not from any other person. There is,
therefore, no room for construction. Indeed, the principal difference between Art.
1524 of the former Civil Code and Art. 1623 of the present one is that the former did
not specify who must give the notice, whereas the present one expressly says the
notice must be given by the vendor. Effect must be given to this change in statutory
language. [41]

In this case, the records are bereft of any indication that Fortunato was given any
written notice of prospective or consummated sale of the portions of Lot No. 2319 by the
vendors or would-be vendors. The thirty (30)-day redemption period under the law,
therefore, has not commenced to run.
Despite this, however, we still rule that petitioner could no longer invoke her right to
redeem from private respondent for the exercise of this right presupposes the existence
of a co-ownership at the time the conveyance is made by a co-owner and when it is
demanded by the other co-owner or co-owners.[42] The regime of co-ownership exists
when ownership of an undivided thing or right belongs to different persons. [43] By the
nature of a co-ownership, a co-owner cannot point to specific portion of the property
owned in common as his own because his share therein remains intangible.[44] As legal
redemption is intended to minimize co-ownership,[45]once the property is subdivided and
distributed among the co-owners, the community ceases to exist and there is no more
reason to sustain any right of legal redemption.[46]
In this case, records reveal that although Lot No. 2319 has not yet been formally
subdivided, still, the particular portions belonging to the heirs of Cleopas Ape had
already been ascertained and they in fact took possession of their respective parts. This
can be deduced from the testimony of petitioner herself, thus:

Q When the plaintiffs leased the share of your husband, were there any metes
and bounds?

A It was not formally subdivided. We have only a definite portion. (hantal-

hantal)

Q This hantal-hantal of your husband, was it also separate and distinct from
the hantal-hantal or the share of the brothers and sisters of your
husband?

A Well, this property in question is a common property.

Q To the north, whose share was that which is adjacent to your husbands
assumed partition?

A I do not know what [does] this north [mean].

COURT

(To Witness)

Q To the place from where the sun rises, whose share was that?

A The shares of Cornelia, Loreta, Encarnacion and Adela.

Q How could you determine their own shares?

A They were residing in their respective assumed portions.

Q How about determining their respective boundaries?

A It could be determined by stakes and partly a row of banana plantations

planted by my son-in-law.

Q Who is this son-in-law you mentioned?

A Narciso Ape.

ATTY. CAWIT

(Continuing)

Q You said that there were stakes to determine the hantal-hantal of your
husband and the hantal-hantal of the other heirs, did I get you right?

ATTY. TAN
Admitted, Your Honor.

ATTY. CAWIT

Q Mrs. Ape, in 1960, Cleopas Ape was already dead, is that correct?

A Certainly, since he died in 1950.

Q By the manifestation of your counsel that the entire land (13 hectares) of
your father-in-law, Cleopas Ape, was leased to Generosa Lumayno, is
this correct?

A No, it is only the assumed portion of my husband [which] was leased to

Generosa Lumayno.

Q For clarification, it was only the share of your husband [which] was leased
to Generosa Cawit Lumayno?

A Yes.[47]

ATTY. CAWIT

Q My question: is that portion which you said was leased by your husband to
the Lumayno[s] and which was included to the lease by your mother-in-
law to the Lumayno[s], when the Lumayno[s] returned your husband[s]
share, was that the same premises that your husband leased to the
Lumayno[s]?

A The same.

Q In re-possessing this portion of the land corresponding to the share of your

husband, did your husband demand that they should re-possess the land
from the Lumayno[s] or did the Lumayno[s] return them to your
husband voluntarily?

A They just returned to us without paying the rentals.

COURT

Q Was the return the result of your husbands request or just voluntarily they
returned it to your husband?

A No, sir, it was just returned voluntarily, and they abandoned the area but my
husband continued farming.[48]

Similarly telling of the partition is the stipulation of the parties during the pre-trial
wherein it was admitted that Lot No. 2319 had not been subdivided nevertheless,
Fortunato Ape had possessed a specific portion of the land ostensibly corresponding to
his share.[49]
From the foregoing, it is evident that the partition of Lot No. 2319 had already been
effected by the heirs of Cleopas Ape. Although the partition might have been informal is
of no moment for even an oral agreement of partition is valid and binding upon the
parties.[50] Likewise, the fact that the respective shares of Cleopas Apes heirs are still
embraced in one and the same certificate of title and have not been technically
apportioned does not make said portions less determinable and identifiable from one
another nor does it, in any way, diminish the dominion of their respective owners.[51]
Turning now to the second issue of the existence of a contract of sale, we rule that
the records of this case betray the stance of private respondent that Fortunato Ape
entered into such an agreement with her.
A contract of sale is a consensual contract, thus, it is perfected by mere consent of
the parties. It is born from the moment there is a meeting of minds upon the thing which
is the object of the sale and upon the price.[52] Upon its perfection, the parties may
reciprocally demand performance, that is, the vendee may compel the transfer of the
ownership and to deliver the object of the sale while the vendor may demand the
vendee to pay the thing sold.[53] For there to be a perfected contract of sale, however,
the following elements must be present: consent, object, and price in money or its
equivalent. In the case of Leonardo v. Court of Appeals, et al.,[54] we explained the
element of consent, to wit:

The essence of consent is the agreement of the parties on the terms of the contract, the
acceptance by one of the offer made by the other. It is the concurrence of the minds of
the parties on the object and the cause which constitutes the contract. The area of
agreement must extend to all points that the parties deem material or there is no
consent at all.

To be valid, consent must meet the following requisites: (a) it should be intelligent, or
with an exact notion of the matter to which it refers; (b) it should be free and (c) it
should be spontaneous. Intelligence in consent is vitiated by error; freedom by
violence, intimidation or undue influence; spontaneity by fraud.[55]

In this jurisdiction, the general rule is that he who alleges fraud or mistake in a
transaction must substantiate his allegation as the presumption is that a person takes
ordinary care for his concerns and that private dealings have been entered into fairly
and regularly.[56] The exception to this rule is provided for under Article 1332 of the Civil
Code which provides that [w]hen one of the parties is unable to read, or if the contract is
in a language not understood by him, and mistake or fraud is alleged, the person
enforcing the contract must show that the terms thereof have been fully explained to the
former.
In this case, as private respondent is the one seeking to enforce the claimed
contract of sale, she bears the burden of proving that the terms of the agreement were
fully explained to Fortunato Ape who was an illiterate. This she failed to do. While she
claimed in her testimony that the contents of the receipt were made clear to Fortunato,
such allegation was debunked by Andres Flores himself when the latter took the witness
stand. According to Flores:

ATTY. TAN

Q Mr. Witness, that receipt is in English, is it not?

A Yes, sir.

Q When you prepared that receipt, were you aware that Fortunato Ape doesnt
know how to read and write English?

A Yes, sir, I know.

 Q Mr. Witness, you said you were present at the time of the signing of that
alleged receipt of P30.00, correct?

A Yes, sir.

Q Where, in what place was this receipt signed?

A At the store.

Q At the time of the signing of this receipt, were there other person[s] present
aside from you, your mother-in-law and Fortunato Ape?

A In the store, yes, sir.

Q When you signed that document of course you acted as witness upon
request of your mother-in-law?

A No, this portion, I was the one who prepared that document.

Q Without asking of (sic) your mother-in-law, you prepared that document or

it was your mother-in-law who requested you to prepare that document
and acted as witness?

A She requested me to prepare but does not instructed (sic) me to act as

witness. It was our opinion that whenever I prepared the document, I
signed it as a witness.

Q Did it not occur to you to ask other witness to act on the side of Fortunato
Ape who did not know how to read and write English?

A It occurred to me.

Q But you did not bother to request a person who is not related to your
mother-in-law, considering that Fortunato Ape did not know how to read
and write English?

A The one who represented Fortunato Ape doesnt know also how to read and
write English. One a maid.

Q You mentioned that there [was another] person inside the store, under your
previous statement, when the document was signed, there [was another]
person in the store aside from you, your mother-in-law and Fortunato
Ape, is not true?

A That is true, there is one person, but that person doesnt know how to
read also.

Q Of course, Mr. Witness, since it occurred to you that there was need for
other witness to sign that document for Fortunato Ape, is it not a fact
that the Municipal Building is very near your house?

A Quite (near).
 Q But you could readily proceed to the Municipal Building and request one
who is knowledgeable in English to act as witness?

A I think there is no need for that small receipt. So I dont bother myself to go.

Q You did not consider that receipt very important because you said that small
receipt?

A Yes, I know.[57]

As can be gleaned from Floress testimony, while he was very much aware of
Fortunatos inability to read and write in the English language, he did not bother to fully
explain to the latter the substance of the receipt (Exhibit G). He even dismissed the idea
of asking somebody else to assist Fortunato considering that a measly sum of thirty
pesos was involved. Evidently, it did not occur to Flores that the document he himself
prepared pertains to the transfer altogether of Fortunatos property to his mother-in-law.
It is precisely in situations such as this when the wisdom of Article 1332 of the Civil
Code readily becomes apparent which is to protect a party to a contract disadvantaged
by illiteracy, ignorance, mental weakness or some other handicap.[58]
In sum, we hold that petitioner is no longer entitled to the right of redemption under
Article 1632 of the Civil Code as Lot No. 2319 had long been partitioned among its co-
owners. This Court likewise annuls the contract of sale between Fortunato and private
respondent on the ground of vitiated consent.
WHEREFORE, premises considered, the decision dated 25 March 1998 of the
Court of Appeals is hereby REVERSED and SET ASIDE and the decision dated 11
March 1994 of the Regional Trial Court, Branch 58, San Carlos City, Negros Occidental,
dismissing both the complaint and the counterclaim, is hereby REINSTATED. No costs.
SO ORDERED.
Puno, (Chairman), Austria-Martinez, Callejo, Sr., and Tinga, JJ., concur.