SICAD VS. CA- Donation Mortis Causa

The real nature of a deed is to be ascertained by both its language and the intention of the parties as demonstrated by the circumstances attendant upon its execution.

FACTS:

Capiz, Dec 1979:
Granny Aurora Montinola, out of the charitable goodness of her heart, drew up a Deed in favor of her darling grandkids Catalino, Judy and Jesus- all of them Valderramas. The deed bore the title ―Deed of Donation Intervivos.”

Thereafter, Aurora’s able secretary presented the Deed to the Registrar for the purpose of canceling the original title and obtaining a transfer certificate of title in favor of the three donees.

A twist of events followed. The duplicate title never reached the donees; Aurora retained the document and maintained possession of the property for ten years after the transfer.

The tipping point arrived when Aurora then alienated the land to spouses Ernesto and Evelyn Sicad. Simultaneously with alienation, Aurora issued a Deed of Revocation of Donation. She asserted that the donation took the nature of mortis causa and was therefore revocable anytime. She further averred that the same failed to follow the formality of wills, and therefore was nullity.

Aurora’s grandchildren found their grandma’s reversal vexing. They insisted that the Deed was one intervivos and therefore irrevocable. The RTC adjudicated and found for the grandchildren.
Aurora took the case to the CA but, alas, kicked the bucket during proceedings.

The Spouses Sicad who were in possession of the property took Aurora’s her place in the litigation. Sadly, the CA reaffirmed the RTC decision.

ISSUE: Whether or not the Donation took the nature of one inter vivos

HELD: No. The donation is mortis causa.

The court found circumstances signifying that Aurora never intended the donation to take effect within her lifetime. First, she expressed that the donation take effect 10 years after her death. Second, she inserted a prohibition on the sale of the property during the 10 year period. Third, she continued to possess the property as well as the fruits and authorized such enjoyment in the deed of donation. Fourth, she retained the certificate of title and subsequently alienated it in favor of the Sicads. All these are indisputable acts of ownership.

The court then concluded that the real nature of a deed is to be ascertained by both its language and the intention of the parties as demonstrated by the circumstances attendant upon its execution.
The deed subject of litigation is one mortis causa because it stipulated ―that all rents, proceeds, fruits, of the donated properties shall remain for the exclusive benefit and disposal of the donor, during her lifetime; and that, without the knowledge and consent of the donor, the donated properties could not be disposed of in any way, whether by sale, mortgage, barter, or in any other way possible.

A donation which pretends to be one inter vivos but withholds form the donee that right to dispose of the donated property during the donor’s lifetime is in truth one mortis causa. In a donation mortis causa ― the right of disposition is not transferred to the donee while the donor is still alive.

Because of Aurora’s actions, nothing was transferred by the deed of donation in question to her grandchildren. They did not get possession of the property donated. They did not acquire the right to the fruits thereof, or any other right of dominion over the property. More importantly, they did not acquire the right to dispose of the property – this would accrue to them only after ten years from Aurora’s death. Moreover, they never saw what the certificate of title looked like.

These circumstances ultimately lead to the conclusion that the donation in question was a donation mortis causa, envisioning a transfer of ownership only after the donor knocks on Heaven’s door.