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Republic of the Philippines

G.R. No. L-23497 April 26, 1968
J.M. TUASON !" CO., #NC., petitioner,
%#$#S#ON,, respondents.
Tuason and Sison for petitioner.
Jose Chuico and Wilfredo E. Dizon for respondents.
RE-ES, J...L., Actg. C.J.:
J. M. Tuason & Co., nc. petitioned for a revie! b" certiorari of the decision issued b"
the Court of Appeals #$ifth %ivision& in its case CA'(.R. No. )*)+,'R, reversin- the
.ud-/ent rendered b" the Court of $irst nstance of Ri0al #Civil Case No. 1'2)23& that
ordered defendant #no! respondent& Estrella 4da. de 5u/anlan to vacate the lot
occupied b" her in 6ta. Mesa 7ei-hts 6ubdivision, barrio Tatalon, 1ue0on Cit", and to
re/ove therefro/ the house and other structures constructed thereon, pa"in- P)28.88
a /onth until restoration of the pre/ises to plaintiff.
The facts are stated in the decision of the Court of Appeals #accepted b" both parties&
in this !ise91wph1.t
. . . That in the co/plaint filed in this case b" plaintiff, J. M. Tuason & Co., nc.,
hereinafter called Tuason, on 38 April, :,;,, the basis is that it bein- the re-istered
o!ner of the propert" <no!n as 6anta Mesa 7ei-hts 6ubdivision, situated at Barrio
North Tatalon, 1ue0on Cit", herein defendant so/eti/e in April, :,2, unla!full"
entered into possession of =88 s>uare /eters, and therein constructed his house so
that plaintiff pra"ed for e.ect/ent and da/a-es for the occupanc"? and defendant in
her ans!er set forthaffirati!e defense that on :) March, :,2,, she had bou-ht the
propert" she !as occup"in- fro/ one Pedro %eudor, and that in a co/pro/ise
a-ree/ent bet!een Pedro and Tuason on :; March :,+3, approved b" the Court of
$irst nstance of 1ue0on Cit", she !as one of the bu"ers therein reco-ni0ed, so that
she as<ed that her ri-hts be reco-ni0ed and the co/plaint dis/issed? but on the basis
of the evidence presented b" both parties in the trial, 5o!er Court sustained plaintiff,
holdin- that Tuason bein- the re-istered o!ner, and the >uestion bein- purel" one of
possession, therefore, defendant@s said evidence !as Aco/pletel" i//aterialA. . . .
#Pa-e ) of %ecision, AnneB AAA of Petition.&
Cpon the facts thus stated, the $ifth %ivision of the Court of Appeals held that,
pursuant to this 6upre/e Court@s rulin- in E!an"elista !s. Deudor, 5':)=);,
6epte/ber :8, :,+,, the Co/pro/ise A-ree/ent #EBh. )& bet!een the petitioner
Tuason & Co. and the %eudors constituted a valid defense a-ainst the possessor"
action filed b" Tuason & Co.? that under para-raph * of said Co/pro/ise A-ree/ent,
petitioner bound and co//itted itself to sell to respondent 5u/anlan the lot occupied
b" her at a reasonable price? that said respondent had a ri-ht to co/pel petitioner to
accept pa"/ent for the lot in >uestion? and that the co/pro/ise a-ree/ent le-ali0ed
the possession of respondent.
These pronounce/ents are assailed b" the petitioner in this appeal as le-all" incorrect
and contrar" to the decisions of this Court.
The ter/s of the co/pro/ise a-ree/ent bet!een the heirs of Telesforo %eudor and J.
M. Tuason & Co. have been ta<en co-ni0ance of in /an" decisions of this Court
#Evan-elista vs. %eudor, #a. cit? %eudor vs. J. M. Tuason & Co., 5':=*;=, Ma" 38,
:,;:, and 5')8:8+, Dct. 3:, :,;3? J. M. Tuason vs. Jara/illo, et al., 5':=,3)'32, 6ept.
38, :,;3? J. M. Tuason vs. Macalindon-, 5':+3,=, %ec. ),, :,;) and others&. The
%eudors had therein reco-ni0ed the re-istered title of Tuason & Co. over the lands
clai/ed b" the/, and received pa"/ent of certain su/s of /one"? but as the %eudors
had, prior to the co/pro/ise, sold their possessor" ri-hts to various persons,
para-raph se!enth of the co/pro/ise a-ree/ent #case 1':3+ of the court of ori-in&
That the sales of the possessor" ri-hts clai/ed b" the %EC%DR6, are described in the
lists sub/itted b" the/ to the DENER6 !hich are attached hereto /ar<ed AnneBes
ABA and ACA and /ade part hereof. Ehatever a/ounts /a" have been collected b" the
%EC%DR6 on account thereof, shall be deducted fro/ the total su/ of P:,)8:,8;3.88
to be paid to the/. t shall be the .oint and solidar" obli-ation of the %EC%DR6 to
/a<e the bu"er of the lots purportedl" sold b" the/ to reco-ni0e the title of the
DENER6 over the propert" purportedl" bou-ht b" the/, and to /a<e the/ si-n,
!henever possible, ne! contracts of purchase for said propert" at the current paces
and ter/s specified b" the DENER6 in their sales of lots in their subdivision <no!n at
A6ta. Mesa 7ei-hts 6ubdivision.A The %EC%DR6 7EREBF advised the DENER6 that
the bu"er listed in AnneB ABA herein !ith the annotation AcontinueA shall bu" the lots
respectivel" occupied b" the/ and shall si-n contracts, but the su/s alread" paid b"
the/ to the %EC%DR6 a/ountin- to P:32,,)).=2 #sub.ect to verification b" the Court&
shall be credited to the bu"ers and shall be deducted fro/ the su/s to be paid to the
%EC%DR6 b" the DENER6. The %EC%DR6 also advise the DENER6 that, the
bu"ers listed in AnneB ACA herein !ith the annotation ARefundA have decided not to
continue !ith their for/er contracts or purchases !ith the %EC%DR6 and the su/s
alread" paid b" the/ to the %EC%DR6 TDTA55N( P:8:,:=).2) #sub.ect to
verification b" the Court& shall be refunded to the/ b" the DENER6 and deducted
fro/ the su/s that /a" be due to the %EC%DR6 fro/ the DENER6 #J.M. Tuason &
Co., nc. vs. Jara/illo, 5':=,3), 6ept. 38, :,;3&?
Careful anal"sis of this para-raph of the co/pro/ise a-ree/ent !ill sho! that !hile
the sa/e created Aa sort of contractual relationA bet!een the J. M. Tuason & Co., nc.,
and the %eudor vendees #as ruled b" this Court in Evan-elista vs. %eudor, ante&, the
sa/e in no !a" obli-ated Tuason & Co. to sell to those bu"ers the lots occupied b"
the/ at the price stipulated !ith the %eudors, but at Athe current prices and ter/s
specified b" the DENER6 #Tuason& in their sales of lots in their subdivision <no!n as
@6ta. Mesa 7ei-hts 6ubdivision@A. This is !hat is eBpressl" provided. $urther, the
para-raph plainl" i/ports that these bu"ers of the %eudors /ust Areco-ni0e the title of
the DENER6 #Tuason& over the propert" purportedl$ bou-ht b" the/A fro/ the
%eudors, and Asi-n, !henever possible, ne! contracts of purchase for said propert"A?
and, if and !hen the" do so, Athe su/s paid b" the/ to the %eudors . . . shall be
credited to the bu"ers.A All that Tuason & Co. a-reed to, therefore, !as to -rant the
%eudor bu"ers preferential ri-ht to purchase Aat current prices and ter/sA the lots
occupied b" the/, upon their reco-ni0in- the title of Tuason & Co., nc., and
si-nin- new contracts therefor? and to credit the/ for the a/ounts the" had paid to the
No!here in her ans!er did the respondent Estrella 4da. de 5u/anlan clai/ that she
had si-ned a ne! contract !ith J. M. Tuason & Co., nc. for the purchase of the lot
occupied. Ehat is !orse, instead of reco-ni0in- the title of the o!ners #Tuason & Co.&
as re>uired b" the afore/entioned co/pro/ise a-ree/ent, she char-ed in para-raph
; of her special defense #Rec. on Appeal, p. :8& that APedro %eudor and his co'o!ners
and the plaintiff herein . . .conspired to"ether and helped each other . . . %$ enterin"
into a supposed CoproiseA !hereb" APedro %eudor and his co'o!ners renounced,
ceded, !aived and >uitclai/ed all their ri-hts, title and interest in the propert" includin-
the land sold to herein defendant, in favor of the plaintiff J. M. Tuason & Co., nc., in
consideration of the su/ of P:,)8:,8;3.88, !ithout the <no!led-e and consent,
and uch less the inter!ention of the herein defendant.A n other !ords, the
respondent 5u/anlan in her ans!er repudiated and assailed the co/pro/ise bet!een
the %eudors and J. M. Tuason & Co. 7o! then can she no! clai/ to ta<e advanta-e
and derive ri-hts fro/ that co/pro/iseG
Eithout the co/pro/ise a-ree/ent, 5u/anlan /ust .ustif" her possession on the
basis of a pretended superiorit" of the %eudors@ old 6panish inforacion
posesoria over Tuason@s Certificate of Title No. :);*, traceable bac< to the ori-inal
Certificate of Title No. *3+ of Ri0al, issued under the Re-istration Act No. 2,;. But, as
ruled b" this Court in previous cases, 5u/anlan is b" no! barred fro/ assailin- the
decree of re-istration in favor of Tuason & Co., nc.@s predecessors t!ent" "ears after
its issuance #Tiburcio vs. P77C, 5':32),, Dct. 3:, :,+,? Tuason & Co. vs. BolaHos,
,+ Phil. :8*? Tuason & Co. vs. 6antia-o, ,, Phil. ;))';)3? Tuason & Co. vs.
Macalindon-, supra? Tuason & Co. vs. Jara/illo, 5':;=)*, Jan. 3:, :,;3&.
t is thus apparent that no le-al basis eBists for the pronounce/ent in the appealed
decision that Tuason & Co. had co//itted itself to sell to 5u/anlan the lot occupied b"
her at a reasonable price, or that the co/pro/ise a-ree/ent le-ali0ed the possession
of the respondent, since the latter does not rel" on the co/pro/ise but, on the
contrar", she assails it.
The Court of Appeals ruled that the price to be paid b" 5u/anlan to Tuason & Co.,
nc., is -overned b" Article :2*2 of the ne! Civil Code of the Philippines, !hich
provides that9
Ehere the price cannot be deter/ined in accordance !ith the precedin- articles, or in
an" other /anner, the contract is inefficacious. 7o!ever, if the thin- or an" part thereof
has been delivered to and appropriated b" the bu"er, he /ust pa" a reasonable price
therefor. Ehat is a reasonable price is a >uestion of fact dependent on the
circu/stances of each particular case.
6ince there has been no contract bet!een petitioner Tuason & Co. and respondent
5u/anlan for the sale of the lot occupied b" the latter, and b" para-raph * of the
Co/pro/ise A-ree/ent #assu/in- that respondent'appellee still has the ri-ht to
invo<e the sa/e, and see< refu-e thereunder&, Tuason & Co. did not consider itself
bound b" the sales /ade b" the %eudors, but de/anded that the %eudor bu"ers
should si-n new contracts !ith it at current prices specified for the sales of lots in A6ta.
Mesa 7ei-hts 6ubdivisionA #ante& the afore>uoted Article :2*2 can have no bearin- on
the case, 5u/anlan not bein- a bu"er fro/ Tuason & Co. As to 5u/anlan@s alle-ation
in her counterclai/ that she should be dee/ed a builder in -ood faith, a si/ilar
contention has been re.ected in Tuason & Co. !s. 'acalindon", 5':+3,=, %ece/ber
),, :,;), !here !e ruled that there bein- a presu/ptive <no!led-e of the Torrens
titles issued to Tuason & Co. and its predecessors'in'interest since :,:2, the bu"er
fro/ the %eudors #or fro/ their transferees& can not, in -ood conscience, sa" no! that
she believed her vendor had ri-hts of o!nership over the lot purchased. The reason
-iven b" the Court is that I
7ad he investi-ated before bu"in- and before buildin- his house on the >uestioned lot,
he !ould have been infor/ed that the land is re-istered under the Torrens s"ste/ in
the na/e of J. M. Tuason & Co., nc., f he failed to /a<e the necessar" in>uir",
appellant is no! bound conclusivel" b" appellee@s Torrens title #6ec. +:, Act 2,;? E/as
vs. Ju0uarre-ui, 3+ Phil. :22& #Tuason & Co., nc. vs. Macalindon-, ante&.
5u/anlan had chosen to i-nore the Torrens title of Tuason & Co., nc. and relied
instead upon the %eudors@ clai/ of o!nership, perhaps because such course
appeared to her as /ore advanta-eous? hence, she has onl" herself to bla/e for the
conse>uences no! that the %eudors@ clai/ has been abandoned b" the %eudors
the/selves, and can not pretend -ood faith. The Court of $irst nstance, therefore, did
not err in holdin- that she !as not a ri-htful possessor and sentencin- her to vacate.
Respondent could have as<ed that she recover or be credited !ith the a/ounts paid
b" her to the %eudors, but as no clai/ to such credit !as ever advanced b" her in the
trial Court, no pronounce/ent can be /ade thereon in this appeal. E>uit" de/ands,
ho!ever, that her ri-ht to clai/ such return, or to have the a/ount offset a-ainst the
su/s she !as sentenced to pa", should be, as it is, reserved.
E7ERE$DRE, the decision of the Court of Appeals is reversed and that of the Court
of $irst nstance reinstated. Costs a-ainst respondent, Estrella 4da. de 5u/anlan.