JESSIE V. PISUEÑA, petitioner, vs. HEIRS OF PETRA UNATING and AQUILINO VILLAR, Represented by Salvador Upod and Dolores Bautista, respondents. Misä act

Real property acquired during marriage is presumed to be conjugal. Such prima facie presumption, however, can be overturned by a cadastral court’s specific finding, which has long become final, that the lot in question was paraphernal in character. The title to the entire property shall pass by operation of law to the buyer once the seller acquires title over it by hereditary succession, even if at the time of the execution of the deed of sale, the seller owned only a portion of the property.

Before us is a Petition for Review on Certiorari seeking to set aside the February 26, 1997 Decision of the Court of Appeals1 [Third Division composed of Justices Arturo B. Buena, ponente and chairman; and Ma. Alicia Austria-Martinez and Bernardo Ll. Salas, members.] (CA) in CA-GR CV No. 39955,2 [Entitled "Heirs of Petra Unating et al. v. Jessie Pisuena."] as well as its February 12, 1998 Resolution denying reconsideration. The assailed Decision affirmed in toto the ruling3 [Written by Judge David A. Alfeche Jr.] of the Regional Trial Court (RTC) of Roxas City in Civil Case No. V-5462, which disposed as follows:

The present case is rooted in an action for recovery of (1) possession and ownership of a parcel of land, as well as (2) a sum of money and damages. Before the RTC of Roxas City on May 15, 1989, this case was originally filed against herein petitioner, Jessie Pisueña, by herein respondents, the heirs of Petra Unating and Aquilino Villar represented by Salvador Upod and Dolores Bautista.4 [Initially, it was Dolores Bautista who, on November 9, 1987, filed a case for recovery of possession with a prayer for preliminary injunction or receivership against Pisueña and Upod. During the pretrial conference presided by Judge David A. Alfeche, the original Complaint was amended, with the heirs of Petra Unating and Aquilino Villar, represented by Dolores Bautista and Salvador Upod, as plaintiffs; and Jessie Pisueña as defendant.]

The CA adopted the trial court’s summation of the facts as follows:5 [CA Decision, pp. 2-6; rollo, pp. 36-40. See also RTC Decision, pp. 1-4; rollo, pp. 58-61.] Acctä mis

On June 24, 1992, the trial court ruled that since the disputed lot was the conjugal property of Spouses Petra Unating and Aquilino Villar, its purported sale by Felix and Catalina Villar to Agustin Navarra could be considered valid. The court, however, ruled that its validity pertained only to the share of the late Petra Unating, considering that at the time of the sale, Aquilino Villar was still alive. It likewise held that the respondents, as heirs of Aquilino Villar, were entitled to his one-half share in the disputed lot.

Before the Court of Appeals, Dolores Bautista and Salvador Upod assailed the trial court’s ruling upholding the validity of the Escritura de Venta Absoluta. Jessie Pisueña, on the other hand, questioned the court’s conclusion that the subject lot was conjugal. He claimed that it was paraphernal, and that the Deed of Sale transferred the whole lot to Agustin Navarra, his predecessor-in-interest.

The appellate court affirmed the trial court’s ruling in toto, holding that the disputed lot belonged to the conjugal partnership of Petra Unating and Aquilino Villar, viz.:

The Court of Appeals also rejected Salvador Upod’s attack on the Escritura de Venta Absoluta, reasoning that the Deed of Sale was duly notarized and that no evidence was presented to rebut its due execution, validity and admissibility as evidence. Furthermore, the appellate court noted that the respondents were aware of the nature and the content of the assailed Deed, and that they did not object to its translation given in the trial court.

Likewise, the CA debunked Upod’s contention that Pisueña’s cause of action had prescribed. It ruled: Esmsc

In all, the CA agreed with the trial court that the disputed lot should be divided equally between the heirs of Petra Unating on the one hand, and Jessie Pisueña on the other.

Asserting full ownership over the disputed property and claiming that the CA erred in ruling that Felix and Catalina could have sold only their one-half share in the property, Petitioner Pisueña filed this Petition for Review.6 [The case was deemed submitted on April 29, 1999, upon receipt by the Court of the Memorandum of Dolores Bautista. The Court received Petitioner Pisueña’s Memorandum on April 17, 1999, and Salvador Upod’s Memorandum on April 13, 1999.] Esmmis

Petitioner ascribes to the Court of Appeals the following specific errors:

The Petition is meritorious.

Both the CA and the RTC held that the disputed lot was conjugal and dismissed, as obiter, the phrase "having inherited said lot from her [Petra Unating’s] mother, Margarita Argamaso" found in the dispositive portion of the Decision of the Court of First Instance (CFI) of Capiz in Reconstitution Case No. 1408. They explained that the CFI had no authority to include the phrase, because the only objective of reconstitution was to "restore the certificate covering the property as it stood at the time of its loss or destruction, and should not be stretched to include later changes which alter or affect the title of the registered owner."7 [CA Decision, p. 10; rollo, p. 44.]

We do not agree. It must be emphasized that the dispositive portion of the 1930 Decision, which was rendered by the same CFI of Capiz acting as a cadastral court, already contained the questioned phrase. Therefore, it cannot be said that the CFI in 1980 exceeded its authority when it ordered the reconstitution, in Petra Unating’s name, of the original certificate of title covering the disputed lot or in stating therein that she had inherited it from her mother. After all, such disposition was copied from the same court’s 1930 Decision, as evidenced by an authentic copy of it on file with the Bureau of Lands in Capiz.

Cadastral proceedings are proceedings in rem; like ordinary registration proceedings, they are governed by the usual rules of practice, procedure and evidence.8 [Section 11 of Act 2259 states that, except when it otherwise provides, all the provisions of Act 496 as amended (now PD 1529) are applicable to cadastral proceedings.] A cadastral decree and a certificate of title are issued only after the applicants prove that they are entitled to the claimed lots, all parties are heard, and evidence is considered.

Thus, the finding of the cadastral court that Petra Unating inherited the lot in question from her mother cannot be dismissed as an obiter, which is "an observation made by the court not necessary to the decision rendered."9 [Moreno, Philippine Law Dictionary, 2nd ed., p. 422.] The conclusion of the cadastral court was found in the dispositive portion of its Decision, and it was material to the nature of Petra Unating’s ownership of the lot. Furthermore, it was based on the evidence presented by the parties and considered by the said court. In any event, it must be pointed out that the Decision became final a long time ago, and a final judgment in a cadastral proceeding, or any other in rem proceeding for that matter, is binding and conclusive upon the whole world.10 [See Director of Lands v. Aba, 68 Phil. 85, May 12, 1939; Director of Lands v. Roman Catholic Archbishop of Manila, 41 Phil. 120, October 27, 1920.] Therefore, the lot in dispute can properly be considered as a paraphernal property of Petra Unating.11 [Art. 1381 of the old Civil Code defined paraphernal property as: "xxx that which the wife brings in marriage without including it in the dowry and that which she may acquire after its constitution without adding it to the dowry." In Alvaran v. Marquez, 11 Phil. 263, property which the wife inherited from her mother during the marriage was considered as paraphernal. See also Veloso v. Avila, 60 Phil. 208, June 23, 1934; Osorio v. Posadas, 56 Phil. 748, December 3, 1949; Ramos v. Castelo, 36 Phil. 876, September 20, 1917; Javier v. Osmeña, 34 Phil. 336, March 23, 1916; and Veloso v. Martinez, 28 Phil. 255, October 4, 1914.] Kycalr

Concededly, properties acquired during the marriage are presumed to be conjugal. However, this prima facie presumption cannot prevail over the cadastral court’s specific finding, reached in adversarial proceedings, that the lot was inherited by Petra Unating from her mother. Noteworthy is the fact that the parties do not assail the validity of the cadastral court’s Decision. The 1980 reconstitution of the title to the lot in the name of "Petra Unating, 40 years old, married to Aquilino Villar, Filipino and resident of Ivisan, Capiz, having inherited said lot from her mother Margarita Argamaso x x x" was notice to the world, including her heirs and successors-in-interest, that it belonged to Petra as her paraphernal property. Thus, the words "married to" were merely descriptive of Petra Unating’s status at the time the lot was awarded and registered in her name.12 [See Magallon v. Montejo, 146 SCRA 282, December 16, 1986; Stuart v. Yatco, 4 SCRA 1143, April 27, 1962; Litam v. Espiritu, 100 Phil. 364, November 27, 1956.]

Petitioner Jessie Pisueña traces his claim over the disputed lot to his father-in-law, Agustin Navarra, who in turn acquired it on February 4, 1949 from Felix and Catalina Villar, Petra Unating’s children. His claim is evidenced by a notarized Deed of Sale written in Spanish, captioned Escritura de Venta Absoluta. Private Respondent Salvador Upod, on the other hand, asserts that both the trial and the appellate courts erred in admitting the Deed, citing Section 33, Rule 132 of the Rules of Court, which provides:

We do not agree. Instead, we uphold the Court of Appeals’ disquisition, which we quote:

Furthermore, the respondents were not able to impugn the due execution and validity of the notarized Deed.

Neither are we persuaded by Upod’s argument that the petitioner’s right has prescribed under Article 1144 of the Civil Code.14 [It provides that an action upon a written contract must be filed within ten years from the time the cause of action accrues.] It is undisputed that he was already in possession of the fishpond when the present case was filed.

As already shown, the disputed lot was paraphernal. Since Petra Unating did not leave any other property, will or debt upon her demise in 1948, the property in question was thus inherited by her children, Felix and Catalina Villar; and her husband, Aquilino Villar.15 [Art. 807, Old Civil Code. The following are forced heirs:

3. The widower or widow, natural children legally acknowledged, and the father or the mother of the latter, in the manner, and to the extent established by Articles 834, 835, 836, 837, 841, 842 and 846.] The two children were entitled to two-thirds of their mother’s estate,16 [Art. 808, Old Civil Code. The legitime of legitimate children and descendants consist of two-thirds of the hereditary estate of the father or of the mother. Nevertheless, the latter may dispose of one of the two thirds forming the legitime in order to apply it as a betterment to their legitimate children or descendants. They may freely dispose of the remaining third.] while the husband was entitled to the remaining one-third.17 [Art. 834, Old Civil Code. Any widower or widow who, on the death of his or her spouse, is not divorced or should be so at the fault of the deceased, shall be entitled to a portion in usufruct equal to that corresponding by way of legitime to each of the legitimate children or descendants who have not received any betterment. xxx.] Calrky

By virtue of the Deed of Sale they executed, Felix and Catalina effectively transferred to Agustin Navarra on February 4, 1949, their title over their two-thirds share in the disputed lot. However, they could not have disposed of their father’s share in the same property at the time, as they were not yet its owners. At the most, being the only children, they had an inchoate interest in their father’s share.

When Aquilino Villar died in 1953 without disposing of his one-third share in the disputed property, Felix and Catalina’s inchoate interest in it was actualized, because succession vested in them the title to their father’s share and, consequently, to the entire lot. Thus, that title passed to Agustin Navarra, pursuant to Article 1434 of the present Civil Code, which was already in force at the time of Aquilino’s death in 1953. This provision reads:

The aforequoted article was applied in Llacer v. Muñoz,18 [12 PHIL 328, December 23, 1908. In this case, the plaintiff alleged that the defendant could not have acquired title over the disputed property at the time he allegedly bought the same from plaintiff’s father in 1877, as the latter had obtained his title to it only in 1881. The Court said: "Granting, however, that he did not obtain a portion of the land until some years after he had sold such land to Antonio Muñoz, his subsequent acquisition of the land would have the effect of making his conveyance of the same to Muñoz valid."] Estoque v. Pajimula,19 [24 SCRA 59, July 15, 1968. In this case, the Court held: "While on the date of the sale to Estoque said contract may have been ineffective, for lack of power in the vendor to sell the specific portion described in the deed, the transaction was validated and became fully effective when the next day, October 29, 1951, the vendor, Crispina Perez, became the sole owner of Lot No. 802 of the Rosario Cadastral Survey, Article 1434 of the new Civil Code applied.] Bucton v. Gabar20 [55 SCRA 499, January 31, 1974. The Court said: "Although at the time said petitioner paid P1,000 as part payment of the purchase price on January 19, 1946, private respondents were not yet the owner of the lot, they became such owners on January 24, 1947, when a deed of sale was executed in their favor by the Villarin spouses. In the premises, Article 1434 of the Civil Code, which provides that ‘when a person who is not the owner of the thing sells or alienates title thereto, such title passes by operation of law to the buyer or grantee,’ is applicable."] and Quijada v. Court of Appeal.21 [GR No. 109767, December 4, 1998. In this case, Quijada, we upheld the validity of the sale made by Trinidad Quijada, petitioners’ predecessor-in-interest, in favor of the private respondents, even if the object of the sale was property donated by the former, reasoning that she had retained an inchoate interest by virtue of the reversion clause in the Deed of Donation. Worth repeating is the Court’s disquisition on the matter, viz:

xxx......xxx......xxx

"Be that as it may, there is one thing that militates against the claim of petitioners. Sale, being a consensual contract, is perfected by mere consent, which is manifested the moment there is a meeting of the minds as to the offer and acceptance thereof on three elements: subject matter, price and terms of payment of the price. Ownership by the seller of the thing sold at the time of the perfection of the contract of sale is not an element for its perfection. What the law requires is that (the) seller has the right to transfer ownership at the time the thing sold is delivered Perfection per se does not transfer ownership which occurs upon the actual or constructive delivery of the thing sold. A perfected contract of sale cannot be challenged on the ground of non-ownership on the part of the seller at the time of its perfection; hence the sale is still valid. Mesm

"The consummation, however, of the perfected contract is another matter. It occurs upon the constructive or actual delivery of the subject matter to the buyer when the seller or her successors-in-interest subsequently acquires ownership thereof. Such circumstance happened in this case, when petitioners -- who are Trinidad Quijada’s heirs and successors-in-interest -- became the owners of the subject property upon the reversion of the ownership of the land to them. Consequently, ownership is transferred to respondent Mondejar and those who claim their right from him. Article 1434 of the New Civil Code supports the ruling that the seller’s "title passes by operation of law to the buyer." This rule applies not only when the subject matter of the contract of sale is goods, but also to other kinds of property, including real property."] In each of these cases, the Court upheld the validity of the sale by one who previously did not have, but who subsequently acquired, title over the property sold.

Thus, although Felix and Catalina Villar were not yet the owners of the remaining one-third of the disputed lot when they sold it to Agustin Navarra on February 4, 1949, they became its owners upon their father’s death on January 14, 1953. Pursuant to Article 1434, the title to the lot passed to Augustin Navarra.22 [Although the Escritura was executed before the effectivity of the new Civil Code, the Court nonetheless ruled in Llacer (supra) that a deed of sale executed before 1950 conveyed the property even if at the time the sale was perfected, the seller had no title, provided that he subsequently acquired it.] It must be noted that at the time Felix and Catalina executed the Deed of Sale covering the disputed lot, they intended to sell the entire lot, not just their interest therein, as can be gleaned from a pertinent portion of the Deed, the English translation of which reads:

Consequently, upon the death of Aquilino Villar, the ownership of the whole of Lot No. 1201 became vested in Jessie Pisueña and his wife.

WHEREFORE, the Petition is hereby GRANTED and the assailed Decision is SET ASIDE. Petitioner Jessie Pisueña and his wife, Rosalie Navarra, are hereby declared the owners of Lot. No. 1201, Cadastral 228 of the Cadastral of Ivisan, Capiz. The Register of Deeds of Capiz is AUTHORIZED to cancel the Original Certificate of Title in the name of Petra Unating and to issue a new Transfer Certificate of Title in the name of Spouses Jessie Pisueña and Rosalie Navarra. No costs.

Melo (Chairman), Vitug, Purisima, and Gonzaga-Reyes, JJ., concur. 10/11/99 1:57 PM