TORRES V.

CA
FACTS: In 1969, sisters Antonia Torres and Emeteria Baring entered into a joint venture
agreement with Manuel Torres. Under the agreement, the sisters agreed to execute a deed of
sale in favor Manuel over a parcel of land, the sisters received no cash payment from Manuel but
the promise of profits (60% for the sisters and 40% for Manuel) said parcel of land is to be
developed as a subdivision.
Manuel then had the title of the land transferred in his name and he subsequently mortgaged the
property. He used the proceeds from the mortgage to start building roads, curbs and gutters.
Manuel also contracted an engineering firm for the building of housing units. But due to adverse
claims in the land, prospective buyers were scared off and the subdivision project eventually
failed.
The sisters then filed a civil case against Manuel for damages equivalent to 60% of the value of
the property, which according to the sisters, is whats due them as per the contract.
The lower court ruled in favor of Manuel and the Court of Appeals affirmed the lower court.
The sisters then appealed before the Supreme Court where they argued that there is no
partnership between them and Manuel because the joint venture agreement is void.
ISSUE: Whether or not there exists a partnership.
HELD: Yes. The joint venture agreement the sisters entered into with Manuel is a partnership
agreement whereby they agreed to contribute property (their land) which was to be developed as
a subdivision. While on the other hand, though Manuel did not contribute capital, he is an
industrial partner for his contribution for general expenses and other costs. Furthermore, the
income from the said project would be divided according to the stipulated percentage (60-40).
Clearly, the contract manifested the intention of the parties to form a partnership. Further still, the
sisters cannot invoke their right to the 60% value of the property and at the same time deny the
same contract which entitles them to it.
At any rate, the failure of the partnership cannot be blamed on the sisters, nor can it be blamed to
Manuel (the sisters on their appeal did not show evidence as to Manuels fault in the failure of the
partnership). The sisters must then bear their loss (which is 60%). Manuel does not bear the loss
of the other 40% because as an industrial partner he is exempt from losses.
MAPALO V. MAPALO
Facts:
The spouses Miguel Mapalo and Candida Quiba were the registered owners of a residential land
located in Pangasinan. (1,635 sq. m.)
The spouses donated the eastern half of the land to Miguels brother Maximo Mapalo who was
about to get married.
However, they were deceived into signing, on October 15, 1936, a deed of absolute sale over the
entire land in Maximos favor. Their signatures were procured by fraud because they were made
to believe by Maximo and the lawyer who acted as notary public who "translated" the document,
that the same was a deed of donation in Maximo's favor covering one-half of their land. (It must
be noted that the spouses are illiterate farmers).
Although the document of sale stated a consideration of Five Hundred (P500.00) Pesos, the

aforesaid spouses did not receive anything of value for the land.
In 1938, Maximo Mapalo, without the consent of the spouse, registered the sale in his favor.
After thirteen years (1951), he sold the land to the Narcisos. (Evaristo, Petronila Pacifico and
Miguel) who thereafter registered the sale and obtained a title in their favor.
In 1952, the Narcisos filed a complaint with the CFI to be declared owners of the entire land, for
possession of its western portion; for damages; and for rentals.
The Mapalo spouses filed a counterclaim seeking cancellation of the the Narcisos titles as to the
western half of the land. They said that their signatures to the deed of sale of 1936 was procured
by fraud and that the Narcisos were buyers in bad faith.
They also filed another complaint wherein they asked the court to declare deeds of sale of 1936
and of 1951 over the land in question be declared null and void as to the western half of said
land.
CFI ruled in favor of the Mapalo spouses. Upon appeal filed by Narcisos, CA reversed the lower
courts ruling solely on the ground that the consent of the Mapalo spouses to the deed of sale of
1936 having been obtained by fraud, the same was voidable, not void ab initio, and, therefore, the
action to annul the same, within four years from notice of the fraud, had long prescribed. (From
March 15, 1938). Hence, this appeal.
Issues:
WON the deed of sale executed in 1936 was null and void. YES
WON the Narcisos were purchasers in good faith. NO
Held:
1st issue: YES, the sale was void.
The Civil Code governs the transaction because it was executed in 1936
Accordingly, since the deed of sale of 1936 is governed by the Old Civil Code, it should be asked
whether its case is one wherein there is no consideration, or one with a statement of a false
consideration. If the former, it is void and inexistent; if the latter, only voidable, under the Old Civil
Code.
There is lack of consideration
As observed earlier, the deed of sale of 1936 stated that it had for its consideration Five Hundred
(P500.00) Pesos. In fact, however, said consideration was totally absent. The problem, therefore,
is whether a deed which states a consideration that in fact did not exist, is a contract without
consideration, and therefore void ab initio, or a contract with a false consideration, and therefore,
at least under the Old Civil Code, voidable.
When there is no consideration, the contract is null and void
According to Manresa, what is meant by a contract that states a false consideration is one that
has in fact a real consideration but the same is not the one stated in the document.
In our view, therefore, the ruling of this Court in Ocejo, Perez & Co. vs. Flores, 40 Phil. 921, is
squarely applicable herein. In that case we ruled that a contract of purchase and sale is null and
void and produces no effect whatsoever where the same is without cause or consideration in that
the purchase price which appears thereon as paid has in fact never been paid by the purchaser
to the vendor.
2nd issue: No, they were no purchasers in good faith.

Narcisos were not buyers in good faith

Aside from the fact that all the parties in these cases are neighbors, except Maximo Mapalo the
foregoing facts are explicit enough and sufficiently reveal that the Narcisos were aware of the
nature and extent of the interest of Maximo Mapalo their vendor, over the above-described land
before and at the time the deed of sale in their favor was executed.
The Narcisos were purchaser-in-value but not purchasers in good faith
What was the necessity, purpose and reason of Pacifico Narciso in still going to the spouses
Mapalo and asked them to permit their brother Maximo to dispose of the above-described land?
To this question it is safe to state that this act of Pacifico Narciso is a conclusive manifestation
that they (the Narcisos) did not only have prior knowledge of the ownership of said spouses over
the western half portion in question but that they also have recognized said ownership. It also
conclusively shows their prior knowledge of the want of dominion on the part of their vendor
Maximo Mapalo over the whole land and also of the flaw of his title thereto. Under this situation,
the Narcisos may be considered purchasers in value but certainly not as purchasers in good faith.
ONG V. ONG
Facts:
On February 25, 1976, Imelda Ong, for and in consideration of P1.00 and other valuable
considerations, executed a quitclaim over a parcel of land in Makati in favor of Sandra Maruzzo,
then a minor. On November 19, 1980, Imelda revoked the quitclaim and donated the property to
her son Rex. On June 20, 1983, Sandra, through her guardial ad litem Alfredo Ong, filed an
action to recover the land and to declare the donation to Rex null and void. In their responsive
pleading, petitioners claimed that the quitclaim is equivalent to a donation which requires
acceptance by the donee, and since Sandra was a minor, there was no valid acceptance. The
trial court ruled that the quitclaim is equivalent to a sale. The Intermediate Appellate Court
affirmed the decision.
Issue:
Whether the quitclaim is equivalent to a deed of sale or to a deed of donation
Held:
The execution of a deed purporting to convey ownership of a realty is in itself prima facie
evidence of the existence of a valuable consideration, the party alleging lack of consideration has
the burden of proving such allegation. Even granting that the Quitclaim deed in question is a
donation, Article 741 of the Civil Code provides that the requirement of the acceptance of the
donation in favor of minor by parents of legal representatives applies only to onerous and
conditional donations where the donation may have to assume certain charges or burdens.
Donation to an incapacitated donee does not need the acceptance by the lawful representative if
said donation does not contain any condition. In simple and pure donation, the formal acceptance
is not important for the donor requires no right to be protected and the donee neither undertakes
to do anything nor assumes any obligation. The Quitclaim now in question does not impose any
condition.

VDA DE CANTINDIG V. HEIRS OF ROQUE

Facts:
The subject property in this case is a fishpond which was part of the Malolos Cadastre and has
an area of more than thirteen hectares. As shown in Original Certificate of Title, it is co-owned or
registered in the names of the different persons. (note: there are 16/16 shares)
The co-owners of the fishpond leased it to Mrs. Catindig for a term of ten years counted from
October 1, 1941 for a total rental of six thousand pesos.
After the termination of the lease on September 30, 1951, Mrs. Catindig remained in possession
of the fishpond because she was negotiating with the co-owners for the purchase thereof. She
wanted to buy it for P52,000.
On October 18, 1960 German Ramirez, one of the co-owners, executed a deed wherein he sold
his 2/16 share to Mrs. Catindig for P6,500 The sale was annotated on the title on October 19,
1960.
Two weeks later, Pedro Villanueva, one of the co-owners, learned of the sale executed by
German Ramirez. That sale retroacted to April 13, 1950.
In 1960 the respondents filed this action against Mrs. Catindig to compel her to allow them to
redeem the portion sold by German Ramirez.
The respondents amended their complaint by including a prayer for the recovery of the
possession of the fishpond.
The RTC declared void certain documents of sale regarding portions of the fishpond in litigation.
It ordered Mrs. Catindig to deliver to the respondents (except German Ramirez) the possession of
the said fishpond and to allow the respondents to redeem from Mrs. Catindig the 2/16 portion of
the fishpond which German Ramirez had sold to her.
CA affirmed in toto the RTC ruling. CA said that Mrs. Catindig did not pay P52,000 (the projected
sale) and that it the contract was simulated. Hence, this appeal.
Issue: WON the sale by German Ramizer to Mrs. Catindig was null and void.
Held: YES
The alleged sales were null and void
The conclusive factual finding of the Appellate Court that the alleged sales on April 13 or 14, 1950
of respondents' shares are simulated and void ab initio renders untenable appellant Catindig's
contentions that the remedies available to the respondents, such as an action for annulment,
rescission or reformation, are barred by prescription or laches.
The alleged sales were absolutely simulated, fictitious or inexistent contracts (Arts. 1346 and
1409(2)). "The action or defense for the declaration of the inexistence of a contract does not
prescribe" (Art. 1410). Mere lapse of time cannot give efficacy to a void contract.
The CAs finding that the price was not paid or that the statement in the supposed contracts of
sale as to the payment of the price was simulated fortifies the view that the alleged sales were
void. "If the price is simulated, the sale is void..." (Art. 1471, Civil Code).
A contract of sale with no consideration is void
A contract of sale is void and produces no effect whatsoever where the price, which appears
thereon as paid, has in fact never been paid by the purchaser to the vendor. Such a sale is non-

existent or cannot be considered consummated.

Mrs. Catindig cannot demand
Mrs. Catindig is not entitled to demand the execution of a notarized deed of sale for the 14/16 pro
indiviso portion of the fishpond. She is not entitled because, as already held, the alleged sales in
her favor are void.
Reasonable value of the use and occupation of the fishpond should be limited
We hold that, as a matter of fairness and equity or to avoid unjust enrichment, the liability of Mrs.
Catindig for the reasonable value of the use and occupation of the fishpond should be limited to
the period from October 1, 1951 up to the time in January, 1964 when she turned over the
fishpond to the receiver, namely, the deputy clerk of court of the Court of First Instance of
Bulacan, Malolos Branch I.
From the compensation of P6,000 per annum which Mrs. Catindig is obligated to pay to the
respondents, should be deducted the 2/16 portion of said compensation, corresponding to the
share of German Ramirez, from October 1, 1951 to January, 1964. Thereafter, Mrs. Catindig is
entitled to demand the 2/16 share in the net fruits or earnings of the fishpond from the receiver
until the said share is redeemed by the respondents.
Ruling by the Supreme Court:
The receiver (not Asuncion Meneses Vda. de Catindig) should deliver the possession of the
fishpond to the respondents or their duly authorized representative, together with 14/16 of the net
earnings of the fishpond from January 15, 1964 up to the time the possession is delivered to the
respondents.
The receiver should deliver to Mrs. Catindig a 2/16 share of the net earnings of the fishpond,
corresponding to the share of German Ramirez, from January 15, 1964 up to the time the said
share is redeemed from her.
CORONEL V. CA (October 07, 1996)
FACTS:
Coronel et al. consummated the sale of his property located in Quezon City to respondent
Alcaraz. Since the title of the property was still in the name of the deceased father of the
Coronels, they agreed to transfer its title to their name upon payment of the down payment of
50K. and thereafter an absolute deed of sale will be executed.
Alcarazs mother paid the down payment in behalf of her daughter and as such, Coronel made
the transfer of title to their name. Notwithstanding this fact, Coronel sold the property to petitioner
Mabanag and rescinded its prior contract with Alcaraz.
ISSUE:
WON the rescission of the first contract between Coronel and Alcaraz is valid.
HELD:
The case is a contract of sale subject to a suspensive condition in which consummation is subject
only to the successful transfer of the certificate of title from the name of petitioners' father, to their
names. Thus, the contract of sale became obligatory.
With regard to double sale, the rule that the first in time, stronger in right should apply. The
contention of the petitioner that she was a buyer in good faith because the notice of lis pendens in
the title was annotated after she bought the property is of no merit. In case of double sale, what
finds relevance and materiality is not whether or not the second buyer was a buyer in good faith
but whether or not said second buyer registers such second sale in good faith, that is, without
knowledge of any defect in the title of the property sold.

The ruling should be in favor of Alcaraz because Mabanag registered the property two months
after the notice of lis pendens was annotated in the title and hence, she cannot be a buyer in
good faith
CHENG V. GENATO
Summary: While there was an ongoing contract to sell between a seller of a property and the first
buyers, a second buyer made an offer for the property on the condition that the existing contract
to sell be rescinded. The seller accepted payment, but later relented and continued with the first
transaction. The second buyer is suing for specific performance.
Rule of Law: The breach contemplated in Article 1191 of the New Civil Code for there to be a
valid rescission is the obligor's failure to comply with an obligation already extant, not a failure of
a condition to render that obligation binding.
Facts: Seller Ramon Genato (D) owns two parcels of land which he agreed to sell to spouses
Ernesto and Socorro Da Jose (D)the first buyers. Spouses Da Jose (D) paid P50,000 to
Genato (D) as agreed upon in a contract to sell. Before the balance became due, spouses Da
Jose (D) asked for and was granted a 30-day extension to finish verifying the titles to the
properties.
Pending the effectivity of the extension period, and without due notice to the spouses Da Jose
(D), Genato (D) executed an Affidavit to Annul the Contract to Sell. However, no annotation of the
said affidavit at the back of his titles was made right away.
Meanwhile, Ricardo Cheng (P) went to Genato's (D) residence and expressed interest on the
properties. Genato (D) then showed Cheng (P) the titles to his properties and the Contract to Sell
to spouses Da Jose (D). Genato (D) also showed Cheng (P) the Affidavit to Annul the Contract to
Sell.
In spite of these, Cheng (P) went ahead and issued a check for P50,000.00 upon the assurance
by Genato (D) that the previous contract with spouses Da Jose (D) will be annulled. Genato (D)
issued a handwritten receipt for the money he received.
Later, Genato (D) registered the Affidavit to Annul the Contract to Sell in the Registry of Deeds
and met by coincidence the spouses Da Jose (D) who were also at the Office of the Registry of
Deeds. The spouses Da Jose (D) were shocked to discover about the affidavit and protested
against the rescission of their contract. They reminded Genato (D) that the 30-day extension was
still in effect, and that they were willing and able to pay the balance of the agreed down payment.
Genato (D) decided to continue with their contract and formalized the agreement in a conforme
letter.
Thereafter, Genato (D) informed Cheng (P) of his decision and returned Cheng's (P) down
payment. Consequently, Cheng (P) sent Genato (D) a demand for compliance with their
agreement stating that the contract to sell between him and Genato (D) was already perfected
and threatened legal action.
Meanwhile, spouses Da Jose (D) and Genato (D) proceeded with the transaction. However,
Cheng (P) had an affidavit of adverse claim annotated on the title of the properties of Genato (D)
and filed a case for specific performance against Genato (D) alleging that they have a perfected
contract of sale.
Genato (D) countered that the agreement was only a simple receipt of an option-bid deposit and it
was not earnest money. In addition, the agreement was subject to the condition that the prior
contract with spouses Da Jose (D) must first be canceled.

Spouses Da Jose (D) asserted that they have a superior right to the property as first buyers and
alleged that the unilateral cancellation of the Contract to Sell was without effect and void. They
also cited Cheng's (P) bad faith as a buyer after being informed by Genato (D) of the existing
Contract to Sell.
The lower court ruled in favor of Cheng (P) and recognized that the receipt covered a sale and
not simply an option to buy. It further ruled that there was a valid rescission of the Contract to
Sell. And finally, upon consideration of the substance of the agreement between Genato (D) and
spouses Da Jose (D), it concluded that Cheng (P) was the preferred buyer.
On appeal, the lower court decision was reversed with a ruling that the previous Contract to Sell
was not validly rescinded.
Issues: (1) Was the Contract to Sell between Genato (D) and spouses Da Jose (D) validly
rescinded? (2) Was Cheng's (P) receipt a conditional contract of sale?
Ruling: No. The following jurisprudence cannot be applied because no default can be ascribed to
spouses Da Jose (D) since the 30-day extension period has not yet expired.
In a contract to sell, the payment of the purchase price is a positive suspensive condition, the
failure of which is not a breach, casual or serious, but a situation that prevents the obligation of
the vendor to convey title from acquiring an obligatory force.
Odyssey Park vs. Court of Appeals, 280 SCRA 253
It is one where the happening of the event gives rise to an obligation. Thus, for its non-fulfillment
there will be no contract to speak of, the obligor having failed to perform the suspensive condition
which enforces a juridical relation. In fact with this circumstance, there can be no rescission of an
obligation that is still non-existent, the suspensive condition not having occurred as yet.
Rillo vs. Court of Appeals, 274 SCRA 461
Emphasis should be made that the breach contemplated in Article 1191 of the New Civil Code is
the obligor's failure to comply with an obligation already extant, not a failure of a condition to
render binding that obligation.
Odyssey Park vs. Court of Appeals, supra
Even assuming in gratia argumenti that the spouses Da Jose (D) defaulted, as claimed by
Genato (D), in their Contract to Sell, the affidavit to annul the contract is not called for. With or
without the affidavit, the non-payment of the full down payment of the purchase price ipso facto
avoids their contract to sell, it being subjected to a suspensive condition.
When a contract is subject to a suspensive condition, its effectivity can take place only if and
when the event covered by the condition happens or is fulfilled.
Javier vs. Court of Appeals, 183 SCRA 171 citing Article 1181 of the Civil Code and Araneta vs.
Rural Progress Administration, 92 Phil. 98.
If the suspensive condition does not take place, the parties would stand as if the conditional
obligation had never existed.
Javier vs. Court of Appeals, supra also citing Gaite vs. Fonacier, 2 SCRA 830.
The contract between Genato and spouses Da Jose was a contract to sell which is subject to a
suspensive condition. Thus, there will be no contract to speak of, if the obligor failed to perform
the suspensive condition which enforces a juridical relation. Obviously, the foregoing
jurisprudence cannot be made to apply to the situation in the instant case because no default can
be ascribed to the Da Jose spouses since the 30-day extension period has not yet expired.

Even assuming that the spouses defaulted, the contract also cannot be validly rescinded because
no notice was given to them. Thus, Cheng's contention that the Contract to Sell between Genato
and the Da Jose spouses was rescinded or resolved due to Genato's unilateral rescission finds
no support in this case.
The contract between Genato and Cheng is a contract to sell not a contract of sale. But But even
assuming that it should be treated as a conditional contract of sale, it did not acquire any
obligatory force since it was subject to a suspensive condition that the earlier contract to sell
between Genato and the Da Jose spouses should first be cancelled or rescinded.
Art.1544 should apply because for not only was the contract between herein respondents first in
time; it was also registered long before petitioner's intrusion as a second buyer (PRIMUS
TEMPORE, PORTIOR JURE). (Spouses made annotation on the title of Genato). Since Cheng
was fully aware, or could have been if he had chosen to inquire, of the rights of the Da Jose
spouses under the Contract to Sell duly annotated on the transfer certificates of titles of Genato, it
now becomes unnecessary to further elaborate in detail the fact that he is indeed in bad faith in
entering into such agreement.
KILOSBAYAN V. MORATO
FACTS:
The PCSO decided to establish an online lottery system for the purpose of increasing its revenue
base and diversifying its sources of funds. Sometime before March 1993, after learning that the
PCSO was interested in operating on an online lottery system, the Berjaya Group Berhad, with its
affiliate, the International Totalizator Systems, Inc. became interested to offer its services and
resources to PCSO. Considering the citizenship requirement, the PGMC claims that Berjaya
Group undertook to reduce its equity stakes in PGMC to 40% by selling 35% out of the original
75% foreign stockholdings to local investors. An open letter was sent to President Ramos
strongly opposing the setting up of an online lottery system due to ethical and moral concerns,
however the project pushed through.
ISSUES: Whether the petitioners have locus standi (legal standing); and
Whether the Contract of Lease is legal and valid in light of Sec. 1 of R.A. 1169 as amended by
B.P. Blg. 42.
RULING:
The petitioners have locus standi due to the transcendental importance to the public that the case
demands. The ramifications of such issues immeasurably affect the social, economic and moral
well-being of the people. The legal standing then of the petitioners deserves recognition, and in
the exercise of its sound discretion, the Court brushes aside the procedural barrier.
Sec. 1 of R.A. No. 1169, as amended by B.P. Blg. 42, prohibits the PCSO from holding and
conducting lotteries in collaboration, association or joint venture with any person, association,
company, or entity, whether domestic or foreign. The language of the section is clear that with
respect to its franchise or privilege to hold and conduct charity sweepstakes races, lotteries and
other similar activities, the PCSO cannot exercise it in collaboration, association or joint venture
with any other party. This is the unequivocal meaning and import of the phrase. By the exception
explicitly made, the PCSO cannot share its franchise with another by way of the methods
mentioned, nor can it transfer, assign or lease such franchise.

CARCELLER V. CA (February 10, 1999)

FACTS:
Respondent State Investment Houses Inc. has a parcel of land in Cebu City leased to petitioner
Jose Ramon Caceller with an option to purchase valid until the expiration of the lease contract.
3weeks before the expiration of the contract, petitioner made a request to the respondent for the
extension of the lease contact so he can have an ample time to raise enough funds to avail of the
option of sale.
Respondent denied the request and a month after the expiration of the contract, petitioner made
known his intention to buy the property.
Respondent reiterated the provisions in the contract and asked the petitioner to leave the
property, which will now be offered to the general public for a higher price.
ISSUE:
WON can still exercise his option of sale even after the time to do such has already lapsed.
HELD:
The contract must be interpreted together with the intention of the parties. The letter of the plaintiff
to the respondent requesting for an extension is sufficient proof of his intent to avail of the option
of sale.
In contractual relations, the law allows the parties reasonable leeway on the terms of their
agreement, which is the law between them. When petitioner made his intention to buy known to
the buyer one month after the expiration of contract is within a reasonable time- frame.
Petitioner may buy the property but not anymore to the price stated in the contract. As such,
respondent may increase the price of the land but only to a reasonable and fair market value.
An option is a preparatory contract in which one party grants to the other, for a fixed period and
under specified conditions, the power to decide, whether or not to enter into a principal contract. It
binds the party who has given the option, not to enter into the principal contract with any other
person during the period designated, and, within that period, to enter into such contract with the
one to whom the option was granted, if the latter should decide to use the option. It is a separate
agreement distinct from the contract which the parties may enter into upon the consummation of
the option.
CORNELIA MATABUENA vs. PETRONILA CERVANTES
FACTS:
In 1956, herein appellants brother Felix Matabuena donated a piece of lot to his common-law
spouse, herein appellee Petronila Cervantes. Felix and Petronila got married only in 1962 or six
years after the deed of donation was executed. Five months later, or September 13, 1962, Felix
died. Thereafter, appellant Cornelia Matabuena, by reason of being the only sister and nearest
collateral relative of the deceased, filed a claim over the property, by virtue of a an affidavit of selfadjudication executed by her in 1962, had the land declared in her name and paid the estate and
inheritance taxes thereon. The lower court of Sorsogon declared that the donation was valid
inasmuch as it was made at the time when Felix and Petronila were not yet spouses, rendering
Article 133 of the Civil Code inapplicable.
ISSUE: Whether or not the ban on donation between spouses during a marriage applies to a
common-law relationship.

HELD:
While Article 133 of the Civil Code considers as void a donation between the spouses during
marriage, policy consideration of the most exigent character as well as the dictates of morality
requires that the same prohibition should apply to a common-law relationship.
As stated in Buenaventura vs. Bautista (50 OG 3679, 1954), if the policy of the law is to prohibit
donations in favor of the other consort and his descendants because of fear of undue and
improper pressure and influence upon the donor, then there is every reason to apply the same
prohibitive policy to persons living together as husband and wife without the benefit of nuptials.
The lack of validity of the donation by the deceased to appellee does not necessarily result
appellant having exclusive right to the disputed property. As a widow, Cervantes is entitled
one-half of the inheritance, and the surviving sister to the other half.
Article 1001, Civil Code: Should brothers and sisters or their children survive with the widow
widower, the latter shall be entitled to one-half of the inheritance and the brothers and sisters
their children to the other half.

in
to
or
or

CALIMLIM V. FORTUN
Facts:
Petitioner Mercedes Calimlim-Canullas and Fernando Canullas were married in 1962, with 5
children, and were living on a house situated on a land inherited by the latter. In 1978, Fernando
abandoned his family and lived with Corazon Daguines. In 1980, Fernando sold the house and lot
to Daguines, who initiated a complaint for quieting of title. Mercedes resisted, claiming that the
house and lot were conjugal properties, and the sale was null nad void for she had not consented
thereto.
Issues:
Whether or not the construction of a conjugal house on the exclusive property of the husband
ipso facto gave the land the character of conjugal property
Whether or not the sale of the lot together with the house and improvements thereon was valid
under the circumstances surrounding the transaction
Held:
Both the land and the building belong to the conjugal partnership but the conjugal partnership is
indebted to the husband for the value of the land. The spouse owning the lot becomes a creditor
of the conjugal partnership for the value of the lot, which value would be reimbursed at the
liquidation of the conjugal partnership. FERNANDO could not have alienated the house and lot to
DAGUINES since MERCEDES had not given her consent to said sale.
The contract of sale was null and void for being contrary to morals and public policy. The sale was
made by a husband in favor of a concubine after he had abandoned his family and left the
conjugal home where his wife and children lived and from whence they derived their support.
That sale was subversive of the stability of the family, a basic social institution which public policy
cherishes and protects. The law emphatically prohibits the spouses from selling property to each
other subject to certain exceptions. Similarly, donations between spouses during marriage are
prohibited. And this is so because if transfers or con conveyances between spouses were allowed
during marriage, that would destroy the system of conjugal partnership, a basic policy in civil law.
It was also designed to prevent the exercise of undue influence by one spouse over the other, as
well as to protect the institution of marriage, which is the cornerstone of family law. The
prohibitions apply to a couple living as husband and wife without benefit of marriage, otherwise,
"the condition of those who incurred guilt would turn out to be better than those in legal union."
Those provisions are dictated by public interest and their criterion must be imposed upon the wig
of the parties.

RUBIAS V. BATILLER
Facts:
Before the war with Japan, Francisco Militante filed an application for registration of the parcel of
land in question. After the war, the petition was heard and denied. Pending appeal, Militante sold
the land to petitioner, his son-in-law. Plaintiff filed an action for forcible entry against respondent.
Defendant claims the complaint of the plaintiff does not state a cause of action, the truth of the
matter being that he and his predecessors-in-interest have always been in actual, open and
continuous possession since time immemorial under claim of ownership of the portions of the lot
in question.
Issue:
Whether or not the contract of sale between appellant and his father-in-law was void because it
was made when plaintiff was counsel of his father-in-law in a land registration case involving the
property in dispute
Held:
The stipulated facts and exhibits of record indisputably established plaintiff's lack of cause of
action and justified the outright dismissal of the complaint. Plaintiff's claim of ownership to the
land in question was predicated on the sale thereof made by his father-in- law in his favor, at a
time when Militante's application for registration thereof had already been dismissed by the Iloilo
land registration court and was pending appeal in the Court of Appeals.
Article 1491 of our Civil Code (like Article 1459 of the Spanish Civil Code) prohibits in its six
paragraphs certain persons, by reason of the relation of trust or their peculiar control over the
property, from acquiring such property in their trust or control either directly or indirectly and "even
at a public or judicial auction," as follows: (1) guardians; (2) agents; (3) administrators; (4) public
officers and employees; judicial officers and employees, prosecuting attorneys, and lawyers; and
(6) others especially disqualified by law.
Fundamental consideration of public policy render void and inexistent such expressly prohibited
purchase (e.g. by public officers and employees of government property intrusted to them and by
justices, judges, fiscals and lawyers of property and rights in litigation and submitted to or handled
by them, under Article 1491, paragraphs (4) and (5) of our Civil Code) has been adopted in a new
article of our Civil Code, viz, Article 1409 declaring such prohibited contracts as "inexistent and
void from the beginning."
Indeed, the nullity of such prohibited contracts is definite and permanent and cannot be cured by
ratification. The public interest and public policy remain paramount and do not permit of
compromise or ratification. In his aspect, the permanent disqualification of public and judicial
officers and lawyers grounded on public policy differs from the first three cases of guardians,
agents and administrators (Article 1491, Civil Code), as to whose transactions it had been opined
that they may be "ratified" by means of and in "the form of a new contact, in which cases its
validity shall be determined only by the circumstances at the time the execution of such new
contract. The causes of nullity which have ceased to exist cannot impair the validity of the new
contract. Thus, the object which was illegal at the time of the first contract, may have already
become lawful at the time of the ratification or second contract; or the service which was
impossible may have become possible; or the intention which could not be ascertained may have
been clarified by the parties. The ratification or second contract would then be valid from its
execution; however, it does not retroact to the date of the first contract."