220. Caram vs.

Laureta  On August 29, 1959, the defendants Marcos Mata and Codidi Mata filed their answer with
GR. No. L-28740 counterclaim admitting the existence of a private absolute deed of sale of his only property
February 24, 1981 in favor of Claro L. Laureta but alleging that he signed the same as he was subjected to
Topic: Prescription duress, threat and intimidation for the plaintiff was the commanding officer of the 10th
Petitioners: Fermin Caram division USFIP operating in the Municipality of Tagum, Province of Davao; that Laureta's
Respondents: Claro Laureta words and requests were laws; that although the defendant Mata did not like to sell his
Ponente: J. Fernandez property or sign the document without even understanding the same, he was ordered to
accept P650.00 Mindanao Emergency notes; and that due to his fear of harm or danger
that will happen to him or to his family, if he refused he had no other alternative but to
DOCTRINE:
sign the document.
 Marcos Mata and Codidi Mata also admit the existence of a record in the Registry of Deeds
Any action or defense for the declaration of the inexistence of a contract does not prescribe.
regarding a document allegedly signed by him in favor of Fermin Caram, Jr. but denies that
he ever signed the document for he knew beforehand that he had signed a deed of sale in
FACTS:
favor of the plaintiff and that the plaintiff was in possession of the certificate of title.
 Fermin Caram Jr. filed his answer alleging that he bought the property in good faith and he
 On June 10, 1945, Marcos Mata conveyed a large tract of agricultural land located in Tagum,
has no knowledge or information about the previous encumbrances, transactions, and
Davao in favor of Claro Laureta, the respondent herein. The deed of absolute sale in favor
alienations in favor of plaintiff until the filing of the complaints.
of the plaintiff was not registered because it was not acknowledged before a notary public
 The Trial Court rendered a decision declaring the deed of sale in favor of Laureta prevails
or any other authorized officer.
over the deed of sale in favor of Caram.
 At the time the sale was executed, there was no authorized officer before whom the sale
could be acknowledged inasmuch as the civil government in Tagum, Davao was not as yet
ISSUE: W/N the action of Laureta against Caram has already prescribed.
organized.
 However, the defendant Marcos Mata delivered to Laureta the peaceful and lawful
HELD: No
possession of the premises of the land together with the pertinent papers thereof.
 Since then, the plaintiff Laureta had been and is still in continuous, adverse and notorious
 The petitioner contends that the second deed of sale is a voidable contract. Being a
occupation of said land, without being molested, disturbed or stopped by any of the
voidable contract, the action for annulment of the same on the ground of fraud must be
defendants or their representatives. In fact, Laureta had been paying realty taxes due
brought within four (4) years from the discovery of the fraud. In the case at hand, Laureta is
thereon and had introduced improvements worth not less than P20,000.00 at the time of
deemed to have discovered that the land in question has been sold to Caram to his
the filing of the complaint.
prejudice on December 9, 1947, when the Deed of Sale was recorded and entered in the
 2 years after, the same property was sold by Marcos Mata to Fermin Z. Caram, Jr.,
Original Certificate of Title by the Register of Deeds and a new Certificate of Title No. 140
petitioner herein.
was issued in the name of Caram. Therefore, when the present case was filed on June 29,
 Subsequently, Marcos Mata filed with the Court of First Instance of Davao a petition for the
1959, plaintiff's cause of action had long prescribed.
issuance of a new Owner's Duplicate of Original Certificate of Title, alleging as ground
 The petitioner's conclusion that the second deed of sale, "Exhibit F", is a voidable contract
therefor the loss of said title in the evacuation place of defendant Marcos Mata in
is not correct. In order that fraud can be a ground for the annulment of a contract, it must
Magugpo, Tagum, Davao.
be employed prior to or simultaneous to the, consent or creation of the contract. The fraud
 The Court of First Instance of Davao issued an order directing the Register of Deeds of
or dolo causante must be that which determines or is the essential cause of the
Davao to issue a new Owner's Duplicate Certificate of Title No. 3019 in favor of Marcos
contract. Dolo causante as a ground for the annulment of contract is specifically described
Mata and declaring the lost title as null and void.
in Article 1338 of the New Civil Code of the Philippines as "insidious words or machinations
 The second sale between Marcos Mata and Fermin Caram, Jr. was then registered with the
of one of the contracting parties" which induced the other to enter into a contract, and
Register of Deeds. On the same date, Transfer Certificate of Title No. 140 was issued in
"without them, he would not have agreed to".
favor of Fermin Caram Jr.
 The second deed of sale in favor of Caram is not a voidable contract. No evidence
whatsoever was shown that through insidious words or machinations, the representatives
of Caram, Irespe and Aportadera had induced Mata to enter into the contract.
 Since the second deed of sale is not a voidable contract, Article 1391, Civil Code of the
Philippines which provides that the action for annulment shall be brought within four (4)
years from the time of the discovery of fraud does not apply. Moreover, Laureta has been
in continuous possession of the land since he bought it in June 1945.
 A more important reason why Laureta's action could not have prescribed is that the second
contract of sale, having been registered in bad faith, is null and void. Article 1410 of the
Civil Code of the Philippines provides that any action or defense for the declaration of the
inexistence of a contract does not prescribe.
 Article 1544 specifically provides who shall be the owner in case of a double sale of an
immovable property. To give full effect to this provision, the status of the two contracts
must be declared valid so that one vendee may contract must be declared void to cut off all
rights which may arise from said contract. Otherwise, Article 1544 win be meaningless.
 In this case, the acquisition of Caram of the property is in bad faith. Irespe and Aportadera,
acting as agents of Caram, had knowledge of circumstances and they knew that Mata's
certificate of title together with other papers pertaining to the land was taken by soldiers
under the command of Col. Claro L. Laureta.. Added to this is the fact that at the time of
the second sale Laureta was already in possession of the land. Irespe and Aportadera
should have investigated the nature of Laureta's possession. If they failed to exercise the
ordinary care expected of a buyer of real estate they must suffer the consequences. The
rule of caveat emptor requires the purchaser to be aware of the supposed title of the
vendor and one who buys without checking the vendor's title takes all the risks and losses
consequent to such failure.