FELICIDAD VDA. DE CABRERA et.al. vs. CA

 Facts:

Assailed in this Petition for Review on Certiorari is the Decision of the respondent Court of Appeals. Felicidad Vda. de Cabrera and Marykane Cabrera was ordered to vacate the portion of Lot 2238 occupied by them and surrender possession thereof to plaintiff, as ordered by the CA adverse from what the RTC had decided which is reconveyance of the said parcel of land to Felicidad.

These are their prayers:

xxx “WHEREFORE, this Honorable Court, after due notice and hearing on the merits of this case; to issue order or orders;

1. Finding the defendants as the rightful, lawful, and legal owner of that portion which was sold to them by Felicidad Teokemian and which was included in the title of plaintiff;

2. To find that the plaintiff did not own the said portion and that they have personal knowledge of the same when the plaintiff filed and secured the title under the Administrative Proceeding;

3. Finding that the plaintiff is only holding the title to that portion only in an implied trust in favor of the real owner;

4. Finding the plaintiff legally obligated to cause the segregation of the portion at their expense and deliver formally the said portion to the real owners, the defendants.

5. To order the plaintiff to execute, prepare and or make any instrument or document to finally vest in the Defendants absolute, clear and flawless title or ownership over the portion which the plaintiff holds title in trust in defendant’s favor. xxx

The respondent court held that such a petition has been barred by laches due to inaction for more than thirty years.  An act by Felicidad though as stated: “the registration of the plaintiff’s title over the subject property was fraudulent insofar as it involved the one-third interest of Felicidad Teokemian who did not sign the Deed of Sale in favor of plaintiff’s predecessor-in-interest and, therefore, the latter held that portion as a trustee of an implied trust for the benefit of Felicidad, pursuant to Art. 1456 of the Civil Code.” Needless to state, these conclusions, being matters of fact, are entitled to our full affirmation, since they are congruent with the findings of the trial court.”

Issue: WON Felicidad could not have recovered the land due to laches.

Held:

The right of the defendants for reconveyance of the subject property arising from an implied trust under Article 1456 of the Civil Code is material to the instant case, such remedy has not yet lapsed, as erroneously submitted by the plaintiffs, and, is thus, a bar to the plaintiff’s action.  In the case of Heirs of Jose Olviga vs. Court of Appeals, we observed that an action for reconveyance of a parcel of land based on implied or constructive trust prescribes in ten years, the point of reference being the date of registration of the deed or the date of the issuance of the certificate of title over the property, but this rule applies onlywhen the plaintiff or the person enforcing the trust is not in possession of the property, since if a person claiming to be the owner thereof is in actual possession of the property, as the defendant is in the instant case, the right to seek reconveyance, which in effect seeks to quiet title to the property, does not prescribe.  The reason for this is that one who is in actual possession of a piece of land claiming to be the owner thereof may wait until his possession is disturbed or his title is attacked before taking steps to vindicate his right, the reason for the rule being, that his undisturbed possession gives him a continuing right to seek the aid of a court of equity to ascertain and determine the nature of the adverse claim of a third party and its effect on his own title, which right can be claimed only by one who is in possession.

As it is, before the period of prescription may start, it must be shown that (a) the trustee has performed unequivocal acts of repudiation amounting to an ouster of the cestui que trust; (b) such positive acts of repudiation have been made known to the cestui que trust; and, (c) the evidence thereon is clear and positive.

In the case at bar, the defendant Felicidad Teokemian, and thereafter, the Cabreras, were in actual possession of the property since it was left to Felicidad Teokemian by her father in 1941, which possession had not been interrupted, despite the sale of the two-third portion thereof to the plaintiff in 1950, and the latter’s procurement of a Certificate of Title over the subject property in 1957.  Until the institution of the present action in 1988, plaintiffs, likewise, have not displayed any unequivocal act of repudiation, which could be considered as an assertion of adverse interest from the defendants, which satisfies the above-quoted requisites.  Thus, it cannot be argued that the right of reconveyance on the part of the defendants, and its use as defense in the present suit, has been lost by prescription.

Undisputed is the fact that since the sale of the two-third portion of the subject property to the plaintiff, the latter had allowed Felicidad Teokemian to occupy that one-third portion allotted to her.  There has, therefore, been a partial partition, where the transferees of an undivided portion of the land allowed a co-owner of the property to occupy a definite portion thereof and has not disturbed the same, for a period too long to be ignored--the possessor is in a better condition or right (Potior est conditio possidentis).

Clearly, the plaintiff in this instance is barred from asserting her alleged right over the portion subject matter in the instant case on the ground that their right has been lost by laches.