Property (co-ownership)
1.) [G.R. No. 152766. June 20, 2003]
LILIA SANCHEZ, petitioner, vs. COURT OF APPEALS, HON. VICTORINO S. ALVARO as
Presiding Judge, RTC-Br. 120, Caloocan City, and VIRGINIA TERIA, respondents.
DECISION
BELLOSILLO, J.:
This is a Special Civil Action for Certiorari under Rule 65 of the Rules of Court to
annul and set aside the Decision of the Court of Appeals dated 23 May 2001 as well
as its Resolution dated 8 January 2002 in CA-G.R. SP No. 59182.
Lilia Sanchez, petitioner, constructed a house on a 76-square meter lot owned by
her parents-in-law. The lot was registered under TCT No. 263624 with the following
co-owners: Eliseo Sanchez married to Celia Sanchez, Marilyn Sanchez married to
Nicanor Montalban, Lilian Sanchez, widow, Nenita Sanchez, single, Susana Sanchez
married to Fernando Ramos, and Felipe Sanchez.[1] On 20 February 1995, the lot
was registered under TCT No. 289216 in the name of private respondent Virginia
Teria by virtue of a Deed of Absolute Sale supposed to have been executed on 23
June 1995[2] by all six (6) co-owners in her favor.[3] Petitioner claimed that she did
not affix her signature on the document and subsequently refused to vacate the lot,
thus prompting private respondent Virginia Teria to file an action for recovery of
possession of the aforesaid lot with the Metropolitan Trial Court (MeTC) of
Caloocan City sometime in September 1995, subsequently raffled to Br. 49 of that
court.
On 12 February 1998, the MeTC-Br. 49 of Caloocan City ruled in favor of private
respondent declaring that the sale was valid only to the extent of 5/6 of the lot and
the other 1/6 remaining as the property of petitioner, on account of her signature
in the Deed of Absolute Sale having been established as a forgery.
Petitioner then elevated her appeal to the Regional Trial Court of Caloocan City,
subsequently assigned to Br. 120, which ordered the parties to file their respective
memoranda of appeal. Counsel for petitioner did not comply with this order, nor
even inform her of the developments in her case. Petitioner not having filed any
pleading with the RTC of Caloocan City, the trial court affirmed the 27 July 1998
decision of the MeTC.
On 4 November 1998, the MeTC issued an order for the issuance of a writ of
execution in favor of private respondent Virginia Teria, buyer of the property. On 4
November 1999 or a year later, a Notice to Vacate was served by the sheriff upon
petitioner who however refused to heed the Notice.
On 28 April 1999 private respondent started demolishing petitioners house without
any special permit of demolition from the court.
Due to the demolition of her house which continued until 24 May 1999 petitioner
was forced to inhabit the portion of the premises that used to serve as the houses
toilet and laundry area.
On 29 October 1999 petitioner filed her Petition for Relief from Judgment with the
RTC on the ground that she was not bound by the inaction of her counsel who failed
to submit petitioners appeal memorandum. However the RTC denied the Petition
and the subsequent Motion for Reconsideration.
On 14 June 2000 petitioner filed her Petition for Certiorari with the Court of Appeals
alleging grave abuse of discretion on the part of the court a quo.
On 23 May 2001 the appellate court dismissed the petition for lack of merit. On 18
June 2001 petitioner filed a Motion for Reconsideration but the Court of Appeals
denied the motion in its Resolution of 8 January 2002.
The only issue in this case is whether the Court of Appeals committed grave abuse
of discretion in dismissing the challenged case before it.
As a matter of policy, the original jurisdiction of this Court to issue the so-called
extraordinary writs should generally be exercised relative to actions or proceedings
before the Court of Appeals or before constitutional or other tribunals or agencies
the acts of which for some reason or other are not controllable by the Court of
Appeals. Where the issuance of the extraordinary writ is also within the
competence of the Court of Appeals or the Regional Trial Court, it is either of these
courts that the specific action for the procurement of the writ must be
presented. However, this Court must be convinced thoroughly that two (2) grounds
exist before it gives due course to a certiorari petition under Rule 65: (a) The
tribunal, board or officer exercising judicial or quasi-judicial functions has acted
without or in excess of its or his jurisdiction; and (b) There is no appeal nor any
plain, speedy and adequate remedy in the ordinary course of law.
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Property (co-ownership)
Despite the procedural lapses present in this case, we are giving due course to this
petition as there are matters that require immediate resolution on the merits to
effect substantial justice.
The Rules of Court should be liberally construed in order to promote their object of
securing a just, speedy and inexpensive disposition of every action or proceeding. [4]
The rules of procedure should be viewed as mere tools designed to aid the courts in
the speedy, just and inexpensive determination of the cases before them. Liberal
construction of the rules and the pleadings is the controlling principle to effect
substantial justice.[5] Litigations should, as much as possible, be decided on their
merits and not on mere technicalities.[6]
Verily, the negligence of petitioners counsel cannot be deemed as negligence of
petitioner herself in the case at bar. A notice to a lawyer who appears to have been
unconscionably irresponsible cannot be considered as notice to his client. [7] Under
the peculiar circumstances of this case, it appears from the records that counsel
was negligent in not adequately protecting his clients interest, which necessarily
calls for a liberal construction of the Rules.
The rationale for this approach is explained in Ginete v. Court of Appeals - [8]
This Court may suspend its own rules or exempt a particular case from its operation
where the appellate court failed to obtain jurisdiction over the case owing to
appellants failure to perfect an appeal. Hence, with more reason would this Court
suspend its own rules in cases where the appellate court has already obtained
jurisdiction over the appealed case. This prerogative to relax procedural rules of the
most mandatory character in terms of compliance, such as the period to appeal has
been invoked and granted in a considerable number of cases x x x x
Let it be emphasized that the rules of procedure should be viewed as mere tools
designed to facilitate the attainment of justice. Their strict and rigid application,
which would result in technicalities that tend to frustrate rather than promote
substantial justice, must always be eschewed. Even the Rules of Court reflect this
principle. The power to suspend or even disregard rules can be so pervasive and
compelling as to alter even that which this Court itself has already declared to be
final, as we are now constrained to do in the instant case x x x x
The emerging trend in the rulings of this Court is to afford every party litigant the
amplest opportunity for the proper and just determination of his cause, free from
the constraints of technicalities. Time and again, this Court has consistently held
that rules must not be applied rigidly so as not to override substantial justice.
Aside from matters of life, liberty, honor or property which would warrant the
suspension of the Rules of the most mandatory character and an examination and
review by the appellate court of the lower courts findings of fact, the other
elements that should be considered are the following: (a) the existence of special or
compelling circumstances, (b) the merits of the case, (c) a cause not entirely
attributable to the fault or negligence of the party favored by the suspension of the
rules, (d) a lack of any showing that the review sought is merely frivolous and
dilatory, and (e) the other party will not be unjustly prejudiced thereby. [9]
The suspension of the Rules is warranted in this case since the procedural infirmity
was not entirely attributable to the fault or negligence of petitioner. Besides,
substantial justice requires that we go into the merits of the case to resolve the
present controversy that was brought about by the absence of any partition
agreement among the parties who were co-owners of the subject lot in
question. Hence, giving due course to the instant petition shall put an end to the
dispute on the property held in common.
In Peoples Homesite and Housing Corporation v. Tiongco[10] we held:
There should be no dispute regarding the doctrine that normally notice to counsel is
notice to parties, and that such doctrine has beneficent effects upon the prompt
dispensation of justice. Its application to a given case, however, should be looked
into and adopted, according to the surrounding circumstances; otherwise, in the
courts desire to make a short-cut of the proceedings, it might foster, wittingly or
unwittingly, dangerous collusions to the detriment of justice. It would then be easy
for one lawyer to sell ones rights down the river, by just alleging that he just forgot
every process of the court affecting his clients, because he was so busy. Under this
circumstance, one should not insist that a notice to such irresponsible lawyer is also
a notice to his clients.
Thus, we now look into the merits of the petition.
This case overlooks a basic yet significant principle of civil law: co-
ownership. Throughout the proceedings from the MeTC to the Court of Appeals,
the notion of co-ownership[11] was not sufficiently dealt with. We attempt to
address this controversy in the interest of substantial justice. Certiorari should
therefore be granted to cure this grave abuse of discretion.
2
Property (co-ownership)
Sanchez Roman defines co-ownership as the right of common dominion which two
or more persons have in a spiritual part of a thing, not materially or physically
divided.[12] Manresa defines it as the manifestation of the private right of
ownership, which instead of being exercised by the owner in an exclusive manner
over the things subject to it, is exercised by two or more owners and the undivided
thing or right to which it refers is one and the same. [13]
The characteristics of co-ownership are: (a) plurality of subjects, who are the co-
owners, (b) unity of or material indivision, which means that there is a single object
which is not materially divided, and which is the element which binds the subjects,
and, (c) the recognition of ideal shares, which determines the rights and obligations
of the co-owners.[14]
partition must be done without prejudice to the rights of private respondent
Virginia Teria as buyer of the 5/6 portion of the lot under dispute.
WHEREFORE, the Petition is GRANTED. The Decision of the Court of Appeals dated
23 May 2001 as well as its Resolution dated 8 January 2002 in CA-G.R. SP No. 59182
is ANNULLED and SET ASIDE.A survey of the questioned lot with TCT No. 289216
(formerly TCT No. 263624) by a duly licensed geodetic engineer and the PARTITION
of the aforesaid lot are ORDERED.
Let the records of this case be REMANDED to MeTC-Br. 49, Caloocan City to effect
the aforementioned survey and partition, as well as segregate the 1/6 portion
appertaining to petitioner Lilia Sanchez.

In co-ownership, the relationship of such co-owner to the other co-owners is The Deed of Absolute Sale by the other co-owners to Virginia Teria shall be
fiduciary in character and attribute. Whether established by law or by agreement of RESPECTED insofar as the other undivided 5/6 portion of the property is concerned.
the co-owners, the property or thing held pro-indiviso is impressed with a fiducial
SO ORDERED.
nature so that each co-owner becomes a trustee for the benefit of his co-owners
and he may not do any act prejudicial to the interest of his co-owners.[15]

Thus, the legal effect of an agreement to preserve the properties in co-ownership is

to create an express trust among the heirs as co-owners of the properties. Co-
ownership is a form of trust and every co-owner is a trustee for the others.[16]

Before the partition of a land or thing held in common, no individual or co-owner

can claim title to any definite portion thereof. All that the co-owner has is an ideal
or abstract quota or proportionate share in the entire land or thing.[17]

Article 493 of the Civil Code gives the owner of an undivided interest in the
property the right to freely sell and dispose of it, i.e., his undivided interest. He may
validly lease his undivided interest to a third party independently of the other co-
owners.[18] But he has no right to sell or alienate a concrete, specific or determinate
part of the thing owned in common because his right over the thing is represented
by a quota or ideal portion without any physical adjudication. [19]

Although assigned an aliquot but abstract part of the property, the metes and
bounds of petitioners lot has not been designated. As she was not a party to
the Deed of Absolute Sale voluntarily entered into by the other co-owners, her right
to 1/6 of the property must be respected. Partition needs to be effected to protect
her right to her definite share and determine the boundaries of her property. Such

3
Property (co-ownership)
2.) [G.R. No. 133638. April 15, 2005]
PERPETUA VDA. DE APE, petitioner, vs. THE HONORABLE COURT OF APPEALS and
GENOROSA CAWIT VDA. DE LUMAYNO, respondents.
DECISION
CHICO-NAZARIO, J.:
Before Us is a petition for review on certiorari of the Decision[1] of the Court of
Appeals in CA-G.R. CV No. 45886 entitled, Generosa Cawit de Lumayno,
accompanied by her husband Braulio Lumayno v. Fortunato Ape, including his wife
Perpetua de Ape.
The pertinent facts are as follows:
Cleopas Ape was the registered owner of a parcel of land particularly known as Lot
No. 2319 of the Escalante Cadastre of Negros Occidental and covered by Original
Certificate of Title (OCT) No. RP 1379 (RP-154 [300]).[2] Upon Cleopas Apes death
sometime in 1950, the property passed on to his wife, Maria Ondoy, and their
eleven (11) children, namely: Fortunato, Cornelio, Bernalda, Bienvenido,
Encarnacion, Loreta, Lourdes, Felicidad, Adela, Dominador, and Angelina, all
surnamed Ape.
On 15 March 1973, Generosa Cawit de Lumayno (private respondent herein), joined
by her husband, Braulio,[3] instituted a case for Specific Performance of a Deed of
Sale with Damages against Fortunato and his wife Perpetua (petitioner herein)
before the then Court of First Instance of Negros Occidental. It was alleged in the
complaint that on 11 April 1971, private respondent and Fortunato entered into a
contract of sale of land under which for a consideration of P5,000.00, Fortunato
agreed to sell his share in Lot No. 2319 to private respondent. The agreement was
contained in a receipt prepared by private respondents son-in-law, Andres Flores, at
her behest. Said receipt was attached to the complaint as Annex A thereof and later
marked as Exhibit G for private respondent. The receipt states:
April 11, 1971
TO WHOM IT MAY CONCERN:
This date received from Mrs. Generosa Cawit de Lumayno the sum of THIRTY PESOS
ONLY as Advance Payment of my share in Land Purchased, for FIVE THOUSAND
PESOS LOT #2319.
(Signed)
FORTUNATO APE
P30.00 WITNESS:
(Illegible) [4]
As private respondent wanted to register the claimed sale transaction, she
supposedly demanded that Fortunato execute the corresponding deed of sale and
to receive the balance of the consideration. However, Fortunato unjustifiably
refused to heed her demands. Private respondent, therefore, prayed that Fortunato
be ordered to execute and deliver to her a sufficient and registrable deed of sale
involving his one-eleventh (1/11) share or participation in Lot No. 2319 of the
Escalante Cadastre; to pay P5,000.00 in damages; P500.00 reimbursement for
litigation expenses as well as additional P500.00 for every appeal made; P2,000.00
for attorneys fees; and to pay the costs.[5]
Fortunato and petitioner denied the material allegations of the complaint and
claimed that Fortunato never sold his share in Lot No. 2319 to private respondent
and that his signature appearing on the purported receipt was forged. By way of
counterclaim, the defendants below maintained having entered into a contract of
lease with respondent involving Fortunatos portion of Lot No. 2319. This purported
lease contract commenced in 1960 and was supposed to last until 1965 with an
option for another five (5) years. The annual lease rental was P100.00 which private
respondent and her husband allegedly paid on installment basis. Fortunato and
petitioner also assailed private respondent and her husbands continued possession
of the rest of Lot No. 2319 alleging that in the event they had acquired the shares of
Fortunatos co-owners by way of sale, he was invoking his right to redeem the same.
Finally, Fortunato and petitioner prayed that the lease contract between them and
respondent be ordered annulled; and that respondent be ordered to pay them
[6]
attorneys fees; moral damages; and exemplary damages.
In their reply,[7] the private respondent and her husband alleged that they had
purchased from Fortunatos co-owners, as evidenced by various written
instruments,[8] their respective portions of Lot No. 2319. By virtue of these sales,
4
Property (co-ownership)
they insisted that Fortunato was no longer a co-owner of Lot No. 2319 thus, his
right of redemption no longer existed.
Prior to the resolution of this case at the trial court level, Fortunato died and was
substituted in this action by his children named Salodada, Clarita, Narciso, Romeo,
Rodrigo, Marieta, Fortunato, Jr., and Salvador, all surnamed Ape. [9]
During the trial, private respondent testified that she and her husband acquired the
various portions of Lot No. 2319 belonging to Fortunatos co-owners. Thereafter, her
husband caused the annotation of an adverse claim on the certificate of title of Lot
No. 2319.[10] The annotation states:
Entry No. 123539 Adverse claim filed by Braulio Lumayno. Notice of adverse claim
filed by Braulio Lumayno affecting the lot described in this title to the extent of
77511.93 square meters, more or less, the aggregate area of shares sold to him on
the basis of (alleged) sales in his possession. Doc. No. 157, Page No. 33, Book No. XI,
Series of 1967 of Alexander Cawit of Escalante, Neg. Occ. Date of instrument. June
22, 1967 at 8:30 a.m. (SGD) FEDENCIORRAZ, Actg. Register of Deeds. [11]
In addition, private respondent claimed that after the acquisition of those shares,
she and her husband had the whole Lot No. 2319 surveyed by a certain Oscar
Mascada who came up with a technical description of said piece of
land.[12] Significantly, private respondent alleged that Fortunato was present when
the survey was conducted.[13]
Also presented as evidence for private respondent were pictures taken of some
parts of Lot No. 2319 purportedly showing the land belonging to Fortunato being
bounded by a row of banana plants thereby separating it from the rest of Lot No.
2319.[14]
As regards the circumstances surrounding the sale of Fortunatos portion of the
land, private respondent testified that Fortunato went to her store at the time
when their lease contract was about to expire. He allegedly demanded the rental
payment for his land but as she was no longer interested in renewing their lease
agreement, they agreed instead to enter into a contract of sale which Fortunato
acceded to provided private respondent bought his portion of Lot No. 2319 for
P5,000.00. Thereafter, she asked her son-in-law Flores to prepare the
aforementioned receipt. Flores read the document to Fortunato and asked the
latter whether he had any objection thereto. Fortunato then went on to affix his
signature on the receipt.
For her part, petitioner insisted that the entire Lot No. 2319 had not yet been
formally subdivided;[15] that on 11 April 1971 she and her husband went to private
respondents house to collect past rentals for their land then leased by the former,
however, they managed to collect only thirty pesos;[16] that private respondent
made her (petitioners) husband sign a receipt acknowledging the receipt of said
amount of money;[17] and that the contents of said receipt were never explained to
them.[18] She also stated in her testimony that her husband was an illiterate and
only learned how to write his name in order to be employed in a sugar central.[19] As
for private respondents purchase of the shares owned by Fortunatos co-owners,
petitioner maintained that neither she nor her husband received any notice
regarding those sales transactions.[20] The testimony of petitioner was later on
corroborated by her daughter-in-law, Marietta Ape Dino.[21]
After due trial, the court a quo rendered a decision[22] dismissing both the complaint
and the counterclaim. The trial court likewise ordered that deeds or documents
representing the sales of the shares previously owned by Fortunatos co-owners be
registered and annotated on the existing certificate of title of Lot No. 2319.
According to the trial court, private respondent failed to prove that she had actually
paid the purchase price of P5,000.00 to Fortunato and petitioner. Applying,
therefore, the provision of Article 1350 of the Civil Code,[23] the trial court
concluded that private respondent did not have the right to demand the delivery to
her of the registrable deed of sale over Fortunatos portion of the Lot No. 2319.
The trial court also rejected Fortunato and petitioners claim that they had the right
of redemption over the shares previously sold to private respondent and the latters
husband, reasoning as follows:
Defendants in their counterclaim invoke their right of legal redemption under
Article 1623 of the New Civil Code in view of the alleged sale of the undivided
portions of the lot in question by their co-heirs and co-owners as claimed by the
plaintiffs in their complaint. They have been informed by the plaintiff about said
sales upon the filing of the complaint in the instant case as far back as March 14,
1973. Defendant themselves presented as their very own exhibits copies of the
respective deeds of sale or conveyance by their said co-heirs and co-owners in favor
of the plaintiffs or their predecessors-in-interest way back on January 2, 1992 when
they formally offered their exhibits in the instant case; meaning, they themselves
acquired possession of said documentary exhibits even before they formally offered
them in evidence. Under Art. 1623 of the New Civil Code, defendants have only
THIRTY (30) DAYS counted from their actual knowledge of the exact terms and
5
Property (co-ownership)
conditions of the deeds of sale or conveyance of their co-heirs and co-owners share
within which to exercise their right of legal redemption. [24]
Within the reglementary period, both parties filed their respective notices of appeal
before the trial court with petitioner and her children taking exception to the
finding of the trial court that the period within which they could invoke their right
of redemption had already lapsed.[25] For her part, private respondent raised as
errors the trial courts ruling that there was no contract of sale between herself and
Fortunato and the dismissal of their complaint for specific performance.[26]
The Court of Appeals, in the decision now assailed before us, reversed and set aside
the trial courts dismissal of the private respondents complaint but upheld the
portion of the court a quos decision ordering the dismissal of petitioner and her
childrens counterclaim. The dispositive portion of the appellate courts decision
reads:
WHEREFORE, the decision dated March 11, 1994, is hereby REVERSED and SET
ASIDE insofar as the dismissal of plaintiffs-appellants complaint is concerned, and
another one is entered ordering the defendant-appellant Fortunato Ape and/or his
wife Perpetua de Ape and successors-in-interest to execute in favor of plaintiff-
appellant Generosa Cawit de Lumayno a Deed of Absolute Sale involving the one-
eleventh (1/11) share or participation of Fortunato Ape in Lot No. 2319, Escalante
Cadastre, containing an area of 12,527.19 square meters, more or less, within (30)
days from finality of this decision, and in case of non-compliance with this Order,
that the Clerk of Court of said court is ordered to execute the deed on behalf of the
vendor. The decision is AFFIRMED insofar as the dismissal of defendants-appellants
counterclaim is concerned.
Without pronouncement as to costs.[27]
The Court of Appeals upheld private respondents position that Exhibit G had all the
earmarks of a valid contract of sale, thus:
Exhibit G is the best proof that the P5,000.00 representing the purchase price of the
1/11th share of Fortunato Ape was not paid by the vendee on April 11, 1971, and/or
up to the present, but that does not affect the binding force and effect of the
document. The vendee having paid the vendor an advance payment of the agreed
purchase price of the property, what the vendor can exact from the vendee is full
payment upon his execution of the final deed of sale. As is shown, the vendee
precisely instituted this action to compel the vendor Fortunato Ape to execute the
final document, after she was informed that he would execute the same upon
arrival of his daughter Bala from Mindanao, but afterwards failed to live up to his
contractual obligation (TSN, pp. 11-13, June 10, 1992).
It is not right for the trial court to expect plaintiff-appellant to pay the balance of
the purchase price before the final deed is executed, or for her to deposit the
equivalent amount in court in the form of consignation. Consignation comes into
fore in the case of a creditor to whom tender of payment has been made and
refuses without just cause to accept it (Arts. 1256 and 1252, N.C.C.; Querino vs.
Pelarca, 29 SCRA 1). As vendee, plaintiff-appellant Generosa Cawit de Lumayno
does not fall within the purview of a debtor.
We, therefore, find and so hold that the trial court should have found that exhibit G
bears all the earmarks of a private deed of sale which is valid, binding and
enforceable between the parties, and that as a consequence of the failure and
refusal on the part of the vendor Fortunato Ape to live up to his contractual
obligation, he and/or his heirs and successors-in-interest can be compelled to
execute in favor of, and to deliver to the vendee, plaintiff-appellant Generosa Cawit
de Lumayno a registerable deed of absolute sale involving his one-eleventh (1/11th)
share or participation in Lot No. 2319, Escalante Cadastre, containing an area of
12,527.19 square meters, more or less, within 30 days from finality of this decision,
and, in case of non-compliance within said period, this Court appoints the Clerk of
Court of the trial court to execute on behalf of the vendor the said document. [28]
The Court of Appeals, however, affirmed the trial courts ruling on the issue of
petitioner and her childrens right of redemption. It ruled that Fortunatos receipt of
the Second Owners Duplicate of OCT (RP) 1379 (RP-154 ([300]), containing the
adverse claim of private respondent and her husband, constituted a sufficient
compliance with the written notice requirement of Article 1623 of the Civil Code
and the period of redemption under this provision had long lapsed.
Aggrieved by the decision of the appellate court, petitioner is now before us raising,
essentially, the following issues: whether Fortunato was furnished with a written
notice of sale of the shares of his co-owners as required by Article 1623 of the Civil
Code; and whether the receipt signed by Fortunato proves the existence of a
contract of sale between him and private respondent.
In her memorandum, petitioner claimed that the Court of Appeals erred in
sustaining the court a quos pronouncement that she could no longer redeem the
portion of Lot No. 2319 already acquired by private respondent for no written
6
Property (co-ownership)
notice of said sales was furnished them. According to her, the Court of Appeals
unduly expanded the scope of the law by equating Fortunatos receipt of Second
Owners Duplicate of OCT (RP) 1379 (RP-154 ([300]) with the written notice
requirement of Article 1623. In addition, she argued that Exhibit G could not
possibly be a contract of sale of Fortunatos share in Lot No. 2319 as said document
does not contain (a) definite agreement on the manner of payment of the
price.[29] Even assuming that Exhibit G is, indeed, a contract of sale between private
respondent and Fortunato, the latter did not have the obligation to deliver to
private respondent a registrable deed of sale in view of private respondents own
failure to pay the full purchase price of Fortunatos portion of Lot No. 2319.
Petitioner is also of the view that, at most, Exhibit G merely contained a unilateral
promise to sell which private respondent could not enforce in the absence of a
consideration distinct from the purchase price of the land. Further, petitioner
reiterated her claim that due to the illiteracy of her husband, it was incumbent
upon private respondent to show that the contents of Exhibit G were fully explained
to him. Finally, petitioner pointed out that the Court of Appeals erred when it took
into consideration the same exhibit despite the fact that only its photocopy was
presented before the court.
On the other hand, private respondent argued that the annotation on the second
owners certificate over Lot No. 2319 constituted constructive notice to the whole
world of private respondents claim over the majority of said parcel of land. Relying
on our decision in the case of Cabrera v. Villanueva,[30] private respondent insisted
that when Fortunato received a copy of the second owners certificate, he became
fully aware of the contracts of sale entered into between his co-owners on one
hand and private respondent and her deceased husband on the other.
Private respondent also averred that although (Lot No. 2319) was not actually
partitioned in a survey after the death of Cleopas Ape, the land was partitioned in
a hantal-hantal manner by the heirs. Each took and possessed specific portion or
premises as his/her share in land, farmed their respective portion or premises, and
improved them, each heir limiting his/her improvement within the portion or
premises which were his/her respective share.[31] Thus, when private respondent
and her husband purchased the other parts of Lot No. 2319, it was no longer
undivided as petitioner claims.
The petition is partly meritorious.
Article 1623 of the Civil Code provides:
The right of legal pre-emption or redemption shall not be exercised except within
thirty days from the notice in writing by the prospective vendor, or by the vendor,
as the case may be. The deed of sale shall not be recorded in the Registry of
Property, unless accompanied by an affidavit of the vendor that he has given
written notice thereof to all possible redemptioners.
Despite the plain language of the law, this Court has, over the years, been tasked to
interpret the written notice requirement of the above-quoted provision. In the
case Butte v. Manuel Uy & Sons, Inc.,[32]we declared that
In considering whether or not the offer to redeem was timely, we think that the
notice given by the vendee (buyer) should not be taken into account. The text of
Article 1623 clearly and expressly prescribes that the thirty days for making the
redemption are to be counted from notice in writing by the vendor. Under the old
law (Civ. Code of 1889, Art. 1524), it was immaterial who gave the notice; so long as
the redeeming co-owner learned of the alienation in favor of the stranger, the
redemption period began to run. It is thus apparent that the Philippine legislature in
Article 1623 deliberately selected a particular method of giving notice, and that
method must be deemed exclusive. (39 Am. Jur., 237; Payne vs. State, 12 S.W. 2(d)
528). As ruled in Wampler vs. Lecompte, 150 Atl. 458 (affd. in 75 Law Ed. [U.S.] 275)
why these provisions were inserted in the statute we are not informed, but we may
assume until the contrary is shown, that a state of facts in respect thereto existed,
which warranted the legislature in so legislating.
The reasons for requiring that the notice should be given by the seller, and not by
the buyer, are easily divined. The seller of an undivided interest is in the best
position to know who are his co-owners that under the law must be notified of the
sale. Also, the notice by the seller removes all doubts as to fact of the sale, its
perfection; and its validity, the notice being a reaffirmation thereof, so that the
party notified need not entertain doubt that the seller may still contest the
alienation. This assurance would not exist if the notice should be given by the
buyer.[33]
The interpretation was somehow modified in the case of De Conejero, et al. v. Court
[34]
of Appeals, et al. wherein it was pointed out that Article 1623 does not prescribe
a particular form of notice, nor any distinctive method for notifying the
redemptioner thus, as long as the redemptioner was notified in writing of the sale
and the particulars thereof, the redemption period starts to run. This view was
reiterated in Etcuban v. The Honorable Court of Appeals, et al.,[35] Cabrera v.
7
Property (co-ownership)
Villanueva,[36] Garcia, et al. v. Calaliman, et al.,[37] Distrito, et al. v. The Honorable A It was not formally subdivided. We have only a definite portion. (hantal-hantal)
Court of Appeals, et al.,[38] and Mariano, et al. v. Hon. Court of Appeals, et al. [39]
Q This hantal-hantal of your husband, was it also separate and distinct from
However, in the case of Salatandol v. Retes,[40] wherein the plaintiffs were not the hantal-hantal or the share of the brothers and sisters of your husband?
furnished any written notice of sale or a copy thereof by the vendor, this Court
again referred to the principle enunciated in the case of Butte. As observed by A Well, this property in question is a common property.
Justice Vicente Mendoza, such reversion is only sound, thus:
Q To the north, whose share was that which is adjacent to your husbands assumed
Art. 1623 of the Civil Code is clear in requiring that the written notification should partition?
come from the vendor or prospective vendor, not from any other person. There is, A I do not know what [does] this north [mean].
therefore, no room for construction. Indeed, the principal difference between Art. COURT
1524 of the former Civil Code and Art. 1623 of the present one is that the former (To Witness)
did not specify who must give the notice, whereas the present one expressly says Q To the place from where the sun rises, whose share was that?
the notice must be given by the vendor. Effect must be given to this change in A The shares of Cornelia, Loreta, Encarnacion and Adela.
statutory language. [41] Q How could you determine their own shares?
A They were residing in their respective assumed portions.
In this case, the records are bereft of any indication that Fortunato was given any Q How about determining their respective boundaries?
written notice of prospective or consummated sale of the portions of Lot No. 2319 A It could be determined by stakes and partly a row of banana plantations planted
by the vendors or would-be vendors. The thirty (30)-day redemption period under by my son-in-law.
the law, therefore, has not commenced to run. Q Who is this son-in-law you mentioned?
A Narciso Ape.
Despite this, however, we still rule that petitioner could no longer invoke her right ATTY. CAWIT
to redeem from private respondent for the exercise of this right presupposes the (Continuing)
existence of a co-ownership at the time the conveyance is made by a co-owner and Q You said that there were stakes to determine the hantal-hantal of your husband
when it is demanded by the other co-owner or co-owners.[42] The regime of co- and the hantal-hantal of the other heirs, did I get you right?
ownership exists when ownership of an undivided thing or right belongs to different ATTY. TAN
persons.[43] By the nature of a co-ownership, a co-owner cannot point to specific Admitted, Your Honor.
portion of the property owned in common as his own because his share therein ATTY. CAWIT
remains intangible.[44] As legal redemption is intended to minimize co- Q Mrs. Ape, in 1960, Cleopas Ape was already dead, is that correct?
ownership,[45] once the property is subdivided and distributed among the co- A Certainly, since he died in 1950.
owners, the community ceases to exist and there is no more reason to sustain any Q By the manifestation of your counsel that the entire land (13 hectares) of your
right of legal redemption.[46] father-in-law, Cleopas Ape, was leased to Generosa Lumayno, is this correct?
A No, it is only the assumed portion of my husband [which] was leased to Generosa
In this case, records reveal that although Lot No. 2319 has not yet been formally
Lumayno.
subdivided, still, the particular portions belonging to the heirs of Cleopas Ape had
Q For clarification, it was only the share of your husband [which] was leased to
already been ascertained and they in fact took possession of their respective parts.
Generosa Cawit Lumayno?
This can be deduced from the testimony of petitioner herself, thus:
A Yes.[47]
Q When the plaintiffs leased the share of your husband, were there any metes and ATTY. CAWIT
bounds?
8
Property (co-ownership)
Q My question: is that portion which you said was leased by your husband to the
Lumayno[s] and which was included to the lease by your mother-in-law to the
Lumayno[s], when the Lumayno[s] returned your husband[s] share, was that the
same premises that your husband leased to the Lumayno[s]?
A The same.
Q In re-possessing this portion of the land corresponding to the share of your
husband, did your husband demand that they should re-possess the land from the
Lumayno[s] or did the Lumayno[s] return them to your husband voluntarily?
A They just returned to us without paying the rentals.
COURT
Q Was the return the result of your husbands request or just voluntarily they
returned it to your husband?
A No, sir, it was just returned voluntarily, and they abandoned the area but my
husband continued farming.[48]
Similarly telling of the partition is the stipulation of the parties during the pre-trial
wherein it was admitted that Lot No. 2319 had not been subdivided nevertheless,
Fortunato Ape had possessed a specific portion of the land ostensibly
[49]
corresponding to his share.
From the foregoing, it is evident that the partition of Lot No. 2319 had already been
effected by the heirs of Cleopas Ape. Although the partition might have been
informal is of no moment for even an oral agreement of partition is valid and
binding upon the parties.[50] Likewise, the fact that the respective shares of Cleopas
Apes heirs are still embraced in one and the same certificate of title and have not
been technically apportioned does not make said portions less determinable and
identifiable from one another nor does it, in any way, diminish the dominion of
their respective owners.[51]
Turning now to the second issue of the existence of a contract of sale, we rule that
the records of this case betray the stance of private respondent that Fortunato Ape
entered into such an agreement with her.
A contract of sale is a consensual contract, thus, it is perfected by mere consent of
the parties. It is born from the moment there is a meeting of minds upon the thing
which is the object of the sale and upon the price.[52] Upon its perfection, the
parties may reciprocally demand performance, that is, the vendee may compel the
transfer of the ownership and to deliver the object of the sale while the vendor may
demand the vendee to pay the thing sold.[53] For there to be a perfected contract of
sale, however, the following elements must be present: consent, object, and price
in money or its equivalent. In the case of Leonardo v. Court of Appeals, et al.,[54] we
explained the element of consent, to wit:
The essence of consent is the agreement of the parties on the terms of the
contract, the acceptance by one of the offer made by the other. It is the
concurrence of the minds of the parties on the object and the cause which
constitutes the contract. The area of agreement must extend to all points that the
parties deem material or there is no consent at all.
To be valid, consent must meet the following requisites: (a) it should be intelligent,
or with an exact notion of the matter to which it refers; (b) it should be free and (c)
it should be spontaneous. Intelligence in consent is vitiated by error; freedom by
violence, intimidation or undue influence; spontaneity by fraud. [55]
In this jurisdiction, the general rule is that he who alleges fraud or mistake in a
transaction must substantiate his allegation as the presumption is that a person
takes ordinary care for his concerns and that private dealings have been entered
into fairly and regularly.[56] The exception to this rule is provided for under Article
1332 of the Civil Code which provides that [w]hen one of the parties is unable to
read, or if the contract is in a language not understood by him, and mistake or fraud
is alleged, the person enforcing the contract must show that the terms thereof have
been fully explained to the former.
In this case, as private respondent is the one seeking to enforce the claimed
contract of sale, she bears the burden of proving that the terms of the agreement
were fully explained to Fortunato Ape who was an illiterate. This she failed to do.
While she claimed in her testimony that the contents of the receipt were made
clear to Fortunato, such allegation was debunked by Andres Flores himself when
the latter took the witness stand. According to Flores:
ATTY. TAN
Q Mr. Witness, that receipt is in English, is it not?
A Yes, sir.
Q When you prepared that receipt, were you aware that Fortunato Ape doesnt
know how to read and write English?
A Yes, sir, I know.
Q Mr. Witness, you said you were present at the time of the signing of that alleged
receipt of P30.00, correct?
A Yes, sir.
Q Where, in what place was this receipt signed?
9
Property (co-ownership)
A At the store. he himself prepared pertains to the transfer altogether of Fortunatos property to
Q At the time of the signing of this receipt, were there other person[s] present his mother-in-law. It is precisely in situations such as this when the wisdom of
aside from you, your mother-in-law and Fortunato Ape? Article 1332 of the Civil Code readily becomes apparent which is to protect a party
A In the store, yes, sir. to a contract disadvantaged by illiteracy, ignorance, mental weakness or some
[58]
Q When you signed that document of course you acted as witness upon request of other handicap.
your mother-in-law? In sum, we hold that petitioner is no longer entitled to the right of redemption
A No, this portion, I was the one who prepared that document. under Article 1632 of the Civil Code as Lot No. 2319 had long been partitioned
Q Without asking of (sic) your mother-in-law, you prepared that document or it was among its co-owners. This Court likewise annuls the contract of sale between
your mother-in-law who requested you to prepare that document and acted as Fortunato and private respondent on the ground of vitiated consent.
witness?
A She requested me to prepare but does not instructed (sic) me to act as witness. It WHEREFORE, premises considered, the decision dated 25 March 1998 of the Court
was our opinion that whenever I prepared the document, I signed it as a witness. of Appeals is hereby REVERSED and SET ASIDE and the decision dated 11 March
Q Did it not occur to you to ask other witness to act on the side of Fortunato Ape 1994 of the Regional Trial Court, Branch 58, San Carlos City, Negros Occidental,
who did not know how to read and write English? dismissing both the complaint and the counterclaim, is hereby REINSTATED. No
A It occurred to me. costs. SO ORDERED.
Q But you did not bother to request a person who is not related to your mother-in-
law, considering that Fortunato Ape did not know how to read and write English?
A The one who represented Fortunato Ape doesnt know also how to read and write
English. One a maid.
Q You mentioned that there [was another] person inside the store, under your
previous statement, when the document was signed, there [was another] person in
the store aside from you, your mother-in-law and Fortunato Ape, is not true?
A That is true, there is one person, but that person doesnt know how to read also.
Q Of course, Mr. Witness, since it occurred to you that there was need for other
witness to sign that document for Fortunato Ape, is it not a fact that the Municipal
Building is very near your house?
A Quite (near).
Q But you could readily proceed to the Municipal Building and request one who is
knowledgeable in English to act as witness?
A I think there is no need for that small receipt. So I dont bother myself to go.
Q You did not consider that receipt very important because you said that small
receipt?
A Yes, I know.[57]
As can be gleaned from Floress testimony, while he was very much aware of
Fortunatos inability to read and write in the English language, he did not bother to
fully explain to the latter the substance of the receipt (Exhibit G). He even dismissed
the idea of asking somebody else to assist Fortunato considering that a measly sum
of thirty pesos was involved. Evidently, it did not occur to Flores that the document

10
Property (co-ownership)
3.) Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-4656 November 18, 1912
RICARDO PARDELL Y CRUZ and
VICENTA ORTIZ Y FELIN DE PARDELL, plaintiffs-appellees,
vs.
GASPAR DE BARTOLOME Y ESCRIBANO and
MATILDE ORTIZ Y FELIN DE BARTOLOME, defendants-appellants.
Gaspar de Bartolome, in his own behalf.
B. Gimenez Zoboli, for appellees.
TORRES, J.:
This is an appeal by bill of exceptions, from the judgment of October 5, 1907,
whereby the Honorable Dionisio Chanco, judge, absolved the defendants from the
complaint, and the plaintiff from a counterclaim, without special finding as to costs.
Counsel for the spouses Ricardo y Cruz and Vicente Ortiz y Felin de Pardell, the first
of whom, absent in Spain by reason of his employment, conferred upon the second
sufficient and ample powers to appear before the courts of justice, on June 8, 1905,
in his written complaint, alleged that the plaintiff, Vicente Ortiz, and the defendant,
Matilde Ortiz, are the duly recognized natural daughters of the spouses Miguel Ortiz
and Calixta Felin y Paula who died in Vigan, Ilocos Sur, in 1875 and 1882,
respectively; that Calixta Felin, prior to her death, executed on August 17, 1876, a
nuncupative will in Vigan whereby she made her four children, named Manuel,
Francisca, Vicenta, and Matilde, surnamed Ortiz y Felin, her sole and universal heirs
of all her property; that, of the persons enumerated, Manuel died before his
mother and Francisca a few years after her death, leaving no heirs by force of law,
and therefore the only existing heirs of the said testatrix are the plaintiff Vicenta
Ortiz and the defendant Matilde Ortiz; that, aside from some personal property and
jewelry already divided among the heirs, the testatrix possessed, at the time of the
execution of her will, and left at her death the real properties which, with their
respective cash values, are as follows:
P6,000.00
1. A house of strong material, with the lot on which it is built,
situated on Escolta Street, Vigan, and valued at
2. A house of mixed material, with the lot on which it stands,
1,500.00
at No. 88 Washington Street, Vigan; valued at
3. A lot on Magallanes Street, Vigan; valued at 100.00
4. A parcel of rice land, situated in the barrio of San Julian,
60.00
Vigan; valued at
5. A parcel of rice land in the pueblo of Santa Lucia; valued at 86.00
6. Three parcels of land in the pueblo of Candon; valued at 150.00
Total 7,896.00
That, on or about the first months of the year 1888, the defendants, without judicial
authorization, nor friendly or extrajudicial agreement, took upon themselves the
administration and enjoyment of the said properties and collected the rents, fruits,
and products thereof, to the serious detriment of the plaintiffs' interest; that,
notwithstanding the different and repeated demands extrajudicially made upon
Matilde Ortiz to divide the aforementioned properties with the plaintiff Vicente and
to deliver to the latter the one-half thereof, together with one-half of the fruits and
rents collected therefrom, the said defendant and her husband, the self-styled
administrator of the properties mentioned, had been delaying the partition and
delivery of the said properties by means of unkept promises and other excuses; and
that the plaintiffs, on account of the extraordinary delay in the delivery of one-half
of said properties, or their value in cash, as the case might be, had suffered losses
and damages in the sum of P8,000. Said counsel for the plaintiffs therefore asked
that judgment be rendered by sentencing the defendants, Gaspar de Bartolome,
and Matilde Ortiz Felin de Bartolome, to restore and deliver to the plaintiffs one-
half of the total value in cash, according to appraisal, of the undivided property
specified, which one-half amounted approximately to P3,948, or if deemed proper,
to recognize the plaintiff Vicenta Ortiz to be vested with the full and absolute right
of ownership to the said undivided one-half of the properties in question, as
universal testamentary heir thereof together with the defendant Matilde Ortiz, to
11
Property (co-ownership)
indemnify the plaintiffs in the sum of P8,000, for losses and damages, and to pay
the costs.
Counsel for the defendants, in his answer denied the facts alleged in paragraphs 1,
4, 6, 7, and 8 thereof, inasmuch as, upon the death of the litigating sister's brother
Manuel, their mother, who was still living, was his heir by force of law, and the
defendants had never refused to give to the plaintiff Vicente Ortiz her share of the
said properties; and stated that he admitted the facts alleged in paragraph 2,
provided it be understood, however, that the surname of the defendant's mother
was Felin, and not Feliu, and that Miguel Ortiz died in Spain, and not in Vigan; that
he also admitted paragraph 3 of the complaint, with the difference that the said
surname should be Felin, and likewise paragraph 5, except the part thereof relating
to the personal property and the jewelry, since the latter had not yet been divided;
that the said jewelry was in the possession of the plaintiffs and consisted of: one
Lozada gold chronometer watch with a chain in the form of a bridle curb and a
watch charm consisting of the engraving of a postage stamp on a stone mounted in
gold and bearing the initials M. O., a pair of cuff buttons made of gold coins, four
small gold buttons, two finger rings, another with the initials M. O., and a gold
bracelet; and that the defendants were willing to deliver to the plaintiffs, in
conformity with their petitions, one-half of the total value in cash, according to
appraisement, of the undivided real properties specified in paragraph 5, which half
amounted to P3,948.
In a special defense said counsel alleged that the defendants had never refused to
divide the said property and had in fact several years before solicited the partition
of the same; that, from 1886 to 1901, inclusive, there was collected from the
property on Calle Escolta the sum of 288 pesos, besides a few other small amounts
derived from other sources, which were delivered to the plaintiffs with other larger
amounts, in 1891, and from the property on Calle Washington, called La Quinta,
990.95 pesos, which proceeds, added together, made a total of 1,278.95 pesos,
saving error or omission; that, between the years abovementioned, Escolta, and
that on Calle Washington, La Quinta, 376.33, which made a total of 1,141.71, saving
error or omission; that, in 1897, the work of reconstruction was begun of the house
on Calle Escolta, which been destroyed by an earthquake, which work was not
finished until 1903 and required an expenditure on the part of the defendant
Matilde Ortiz, of 5,091.52 pesos; that all the collections made up to August 1, 1905,
including the rent from the stores, amounted to only P3,654.15, and the expenses,
to P6,252.32, there being, consequently, a balance of P2,598.17, which divided
between the sisters, the plaintiff and the defendant, would make the latter's share
P1,299.08; that, as shown by the papers kept by the plaintiffs, in the year 1891 the
defendant Bartolome presented to the plaintiffs a statement in settlements of
accounts, and delivered to the person duly authorized by the latter for the purpose,
the sum of P2,606.29, which the said settlement showed was owing his principals,
from various sources; that, the defendant Bartolome having been the administrator
of the undivided property claimed by the plaintiffs, the latter were owing the
former legal remuneration of the percentage allowed by law for administration; and
that the defendants were willing to pay the sum of P3,948, one-half of the total
value of the said properties, deducting therefrom the amount found to be owing
them by the plaintiffs, and asked that judgment be rendered in their favor to enable
them to recover from the latter that amount, together with the costs and expenses
of the suit.
The defendants, in their counter claim, repeated each and all of the allegations
contained in each of the paragraphs of section 10 of their answer; that the plaintiffs
were obliged to pay to the administrator of the said property the remuneration
allowed him by law; that, as the revenues collected by the defendants amounted to
no more than P3,654.15 and the expenditures incurred by them, to P6,252.32, it
followed that the plaintiffs owed the defendants P1,299.08, that is one-half of the
difference between the amount collected from and that extended on the
properties, and asked that judgment be therefore rendered in their behalf to enable
them to collect this sum from the plaintiffs, Ricardo Pardell and Vicenta Ortiz, with
legal interest thereon from December 7, 1904, the date when the accounts were
rendered, together with the sums to which the defendant Bartolome was entitled
for the administration of the undivided properties in question.
By a written motion of August 21, 1905, counsel for the plaintiffs requested
permission to amend the complaint by inserting immediately after the words "or
respective appraisal," fifth line of paragraph 5, the phrase "in cash in accordance
with the assessed value," and likewise further to amend the same, in paragraph 6
thereof, by substituting the following word in lieu of the petition for the remedy
sought: "By reason of all the foregoing, I beg the court to be pleased to render the
judgment by sentencing the defendants, Gaspar de Bartolome and Matilde Ortiz
Felin de Bartolome, to restore and deliver to the plaintiffs an exact one-half of the
total vale of the undivided properties described in the complaint, such value to be
ascertained by the expert appraisal of two competent persons, one of whom shall
be appointed by the plaintiffs and the other by the defendants, and, in case of
disagreement between these two appointees such value shall be determined by a
third expert appraiser appointed by the court, or, in a proper case, by the price
12
Property (co-ownership)
offered at public auction; or, in lieu thereof, it is requested that the court recognize
the plaintiff, Vicenta Ortiz, to be vested with a full and absolute right to an
undivided one-half of the said properties; furthermore, it is prayed that the
plaintiffs be awarded an indemnity of P8,000 for losses and damages, and the
costs." Notwithstanding the opposition of the defendants, the said amendment was
admitted by the court and counsel for the defendants were allowed to a period of
three days within which to present a new answer. An exception was taken to this
ruling.
The proper proceedings were had with reference to the valuation of the properties
concerned in the division sought and incidental issues were raised relative to the
partition of some of them and their award to one or the other of the parties. Due
consideration was taken of the averments and statements of both parties who
agreed between themselves, before the court, that any of them might at any time
acquire, at the valuation fixed by the expert judicial appraiser, any of the properties
in question, there being none in existence excluded by the litigants. The court,
therefore, by order of December 28, 1905, ruled that the plaintiffs were entitled to
acquire, at the valuation determined by the said expert appraiser, the building
known as La Quinta, the lot on which it stands and the warehouses and other
improvements comprised within the inclosed land, and the seeds lands situated in
the pueblos of Vigan and Santa Lucia; and that the defendants were likewise
entitled to acquire the house on Calle Escolta, the lot on Calle Magallanes, and the
three parcels of land situated in the pueblo of Candon.
After this partition had been made counsel for the defendants, by a writing of
March 8, 1906, set forth: That, having petitioned for the appraisement of the
properties in question for the purpose of their partition, it was not to be
understood that he desired from the exception duly entered to the ruling made in
the matter of the amendment to the complaint; that the properties retained by the
defendants were valued at P9,310, and those retained by the plaintiffs, at P2,885,
one-half of which amounts each party had to deliver to the other, as they were pro
indiviso properties; that, therefore, the defendants had to pay the plaintiffs the sum
of P3,212.50, after deducting the amount which the plaintiffs were obliged to
deliver to the defendants, as one-half of the price of the properties retained by the
former; that, notwithstanding that the amount of the counterclaim for the
expenses incurred in the reconstruction of the pro indiviso property should be
deducted from the sum which the defendants had to pay the plaintiffs, the former,
for the purpose of bringing the matter of the partition to a close, would deliver to
the latter, immediately upon the signing of the instrument of purchase and sale, the
sum of P3,212.50, which was one-half of the value of the properties alloted to the
defendants; such delivery, however, was not to be understood as a renouncement
of the said counterclaim, but only as a means for the final termination of the pro
indiviso status of the property.
The case having been heard, the court on October 5, 1907, rendered judgment
holding that the revenues and the expenses were compensated by the residence
enjoyed by the defendant party, that no losses or damages were either caused or
suffered, nor likewise any other expense besides those aforementioned, and
absolved the defendants from the complaint and the plaintiffs from the
counterclaim, with no special finding as to costs. An exception was taken to this
judgment by counsel for the defendants who moved for a new trial on the grounds
that the evidence presented did not warrant the judgment rendered and that the
latter was contrary to law. This motion was denied, exception whereto was taken
by said counsel, who filed the proper bill of exceptions, and the same was approved
and forwarded to the clerk of this court, with a transcript of the evidence.
Both of the litigating sisters assented to a partition by halves of the property left in
her will by their mother at her death; in fact, during the course of this suit,
proceedings were had, in accordance with the agreement made, for the division
between them of the said hereditary property of common ownership, which
division was recognized and approved in the findings of the trial court, as shown by
the judgment appealed from.
The issues raised by the parties, aside from said division made during the trial, and
which have been submitted to this court for decision, concern: (1) The indemnity
claimed for losses and damages, which the plaintiffs allege amount to P8,000, in
addition to the rents which should have been derived from the house on Calle
Escolta, Vigan; (2) the payment by the plaintiffs to the defendants of the sum of
P1,299.08, demanded by way of counterclaim, together with legal interest thereon
from December 7, 1904; (3) the payment to the husband of the defendant Matilde
Ortiz, of a percentage claimed to be due him as the administrator of the property of
common ownership; (4) the division of certain jewelry in the possession of the
plaintiff Vicenta Ortiz; and (5) the petition that the amendment be held to have
been improperly admitted, which was made by the plaintiffs in their written motion
of August 21, 1905, against the opposition of the defendants, through which
admission the latter were obliged to pay the former P910.50.lawphil.net
13
Property (co-ownership)
Before entering upon an explanation of the propriety or impropriety of the claims
made by both parties, it is indispensable to state that the trial judge, in absolving
the defendants from the complaint, held that they had not caused losses and
damages to the plaintiffs, and that the revenues and the expenses were
compensated, in view of the fact that the defendants had been living for several
years in the Calle Escolta house, which was pro indiviso property of joint ownership.
By this finding absolving the defendants from the complaint, and which was
acquiesced in by the plaintiffs who made no appeal therefrom, the first issue has
been decided which was raised by the plaintiffs, concerning the indemnity for losses
and damages, wherein are comprised the rents which should have been obtained
from the upper story of the said house during the time it was occupied by the
defendants, Matilde Ortiz and her husband, Gaspar de Bartolome.
Notwithstanding the acquiescence on the part of the plaintiffs, assenting to the said
finding whereby the defendants were absolved from the complaint, yet, as such
absolution is based on the compensation established in the judgment of the trial
court, between the amounts which each party is entitled to claim from the other, it
is imperative to determine whether the defendant Matilde Ortiz, as coowner of the
house on Calle Escolta, was entitled, with her husband, to reside therein, without
paying to her coowner, Vicenta Ortiz, who, during the greater part of the time, lived
with her husband abroad, one-half of the rents which the upper story would have
produced, had it been rented to a stranger.
Article 394 of the Civil Code prescribes:
Each coowner may use the things owned in common, provided he uses them in
accordance with their object and in such manner as not to injure the interests of
the community nor prevent the coowners from utilizing them according to their
rights.
Matilde Ortiz and her husband occupied the upper story, designed for use as a
dwelling, in the house of joint ownership; but the record shows no proof that, by so
doing, the said Matilde occasioned any detriment to the interest of the community
property, nor that she prevented her sister Vicenta from utilizing the said upper
story according to her rights. It is to be noted that the stores of the lower floor were
rented and accounting of the rents was duly made to the plaintiffs.
Each coowner of realty held pro indiviso exercises his rights over the whole property
and may use and enjoy the same with no other limitation than that he shall not
injure the interests of his coowners, for the reason that, until a division be made,
the respective part of each holder can not be determined and every one of the
coowners exercises, together with his other coparticipants, joint ownership over
the pro indiviso property, in addition to his use and enjoyment of the same.
As the hereditary properties of the joint ownership of the two sisters, Vicenta Ortiz,
plaintiff, and Matilde Ortiz, defendant, were situated in the Province of Ilocos Sur,
and were in the care of the last named, assisted by her husband, while the plaintiff
Vicenta with her husband was residing outside of the said province the greater part
of the time between 1885 and 1905, when she left these Islands for Spain, it is not
at all strange that delays and difficulties should have attended the efforts made to
collect the rents and proceeds from the property held in common and to obtain a
partition of the latter, especially during several years when, owing to the
insurrection, the country was in a turmoil; and for this reason, aside from that
founded on the right of coownership of the defendants, who took upon themselves
the administration and care of the properties of joint tenancy for purposes of their
preservation and improvement, these latter are not obliged to pay to the plaintiff
Vicenta one-half of the rents which might have been derived from the upper of the
story of the said house on Calle Escolta, and, much less, because one of the living
rooms and the storeroom thereof were used for the storage of some belongings
and effects of common ownership between the litigants. The defendant Matilde,
therefore, in occupying with her husband the upper floor of the said house, did not
injure the interests of her coowner, her sister Vicenta, nor did she prevent the latter
from living therein, but merely exercised a legitimate right pertaining to her as
coowner of the property.
Notwithstanding the above statements relative to the joint-ownership rights which
entitled the defendants to live in the upper story of the said house, yet in view of
the fact that the record shows it to have been proved that the defendant Matilde's
husband, Gaspar de Bartolome, occupied for four years a room or a part of the
lower floor of the same house on Calle Escolta, using it as an office for the justice of
the peace, a position which he held in the capital of that province, strict justice,
requires that he pay his sister-in-law, the plaintiff, one half of the monthly rent
which the said quarters could have produced, had they been leased to another
person. The amount of such monthly rental is fixed at P16 in accordance with the
evidence shown in the record. This conclusion as to Bartolome's liability results
from the fact that, even as the husband of the defendant coowner of the property,
he had no right to occupy and use gratuitously the said part of the lower floor of the
house in question, where he lived with his wife, to the detriment of the plaintiff
14
Property (co-ownership)
Vicenta who did not receive one-half of the rent which those quarters could and
should have produced, had they been occupied by a stranger, in the same manner
that rent was obtained from the rooms on the lower floor that were used as stores.
Therefore, the defendant Bartolome must pay to the plaintiff Vicenta P384, that is,
one-half of P768, the total amount of the rents which should have been obtained
during four years from the quarters occupied as an office by the justice of the peace
of Vigan.
With respect to the second question submitted for decision to this court, relative to
the payment of the sum demanded as a counterclaim, it was admitted and proved
in the present case that, as a result of a serious earthquake on August 15, 1897, the
said house on Calle Escolta was left in ruins and uninhabitable, and that, for its
reconstruction or repair, the defendants had to expend the sum of P6,252.32. This
expenditure, notwithstanding that it was impugned, during the trial, by the
plaintiffs, was duly proved by the evidence presented by the defendants. Evidence,
unsuccessfully rebutted, was also introduced which proved that the rents produced
by all the rural and urban properties of common ownership amounted, up to
August 1, 1905, to the sum of P3,654.15 which, being applied toward the cost of the
repair work on the said house, leaves a balance of P2,598.17, the amount actually
advanced by the defendants, for the rents collected by them were not sufficient for
the termination of all the work undertaken on the said building, necessary for its
complete repair and to replace it in a habitable condition. It is therefore lawful and
just that the plaintiff Vicenta Ortiz, who was willing to sell to her sister Matilde for
P1,500, her share in the house in question, when it was in a ruinous state, should
pay the defendants one-half of the amount expanded in the said repair work, since
the building after reconstruction was worth P9,000, according to expert appraisal.
Consequently, the counterclaim made by the defendants for the payment to them
of the sum of P1,299.08, is a proper demand, though from this sum a reduction
must be made of P384, the amount of one-half of the rents which should have been
collected for the use of the quarters occupied by the justice of the peace, the
payment of which is incumbent upon the husband of the defendant Matilde, as
aforesaid, and the balance remaining, P915.08, is the amount which the plaintiff
Vicenta must pay to the defendants.
The defendants claim to be entitled to the collection of legal interest on the amount
of the counterclaim, from December 7, 1904. This contention can not be sustained,
inasmuch as, until this suit is finally decided, it could not be known whether the
plaintiffs would or would not be obliged to pay the sum whatever in reimbursement
of expenses incurred by the plaintiffs in the repair work on the said house on Calle
Escolta, whether or not the defendants, in turn, were entitled to collect any such
amount, and, finally, what the net sum would be which the plaintiff's might have to
pay as reimbursement for one-half of the expenditure made by the defendants.
Until final disposal of the case, no such net sum can be determined, nor until then
can the debtor be deemed to be in arrears. In order that there be an obligation to
pay legal interest in connection with a matter at issue between the parties, it must
be declared in a judicial decision from what date the interest will be due on the
principal concerned in the suit. This rule has been established by the decisions of
the supreme court of Spain, in reference to articles 1108, 1109, and 1110 of the
Civil Code, reference on April 24, 1867, November 19, 1869, and February 22, 1901.
With regard to the percentage, as remuneration claimed by the husband of the
defendant Matilde for his administration of the property of common ownership,
inasmuch as no stipulation whatever was made in the matter by and between him
and his sister-in-law, the said defendant, the claimant is not entitled to the payment
of any remuneration whatsoever. Of his own accord and as an officious manager,
he administered the said pro indiviso property, one-half of which belonged to his
wife who held it in joint tenancy, with his sister-in-law, and the law does not allow
him any compensation as such voluntary administrator. He is merely entitled to a
reimbursement for such actual and necessary expenditures as he may have made
on the undivided properties and an indemnity for the damages he may have
suffered while acting in that capacity, since at all events it was his duty to care for
and preserve the said property, half of which belonged to his wife; and in exchange
for the trouble occasioned him by the administration of his sister-in-law's half of the
said property, he with his wife resided in the upper story of the house
aforementioned, without payment of one-half of the rents said quarters might have
produced had they been leased to another person.
With respect to the division of certain jewelry, petitioned for by the defendants and
appellants only in their brief in this appeal, the record of the proceedings in the
lower court does not show that the allegation made by the plaintiff Vicenta is not
true, to the effect that the deceased mother of the litigant sisters disposed of this
jewelry during her lifetime, because, had she not done so, the will made by the said
deceased would have been exhibited in which the said jewelry would have been
mentioned, at least it would have been proved that the articles in question came
into the possession of the plaintiff Vicenta without the expressed desire and the
consent of the deceased mother of the said sisters, for the gift of this jewelry was
previously assailed in the courts, without success; therefore, and in view of its
inconsiderable value, there is no reason for holding that the said gift was not made.
15
Property (co-ownership)
As regards the collection of the sum of P910.50, which is the difference between Matilde Ortiz is not entitled to any remuneration for the administration of the pro
the assessed value of the undivided real properties and the price of the same as indiviso property belonging to both parties; (4) that, neither is he entitled to collect
determined by the judicial expert appraiser, it is shown by the record that the ruling from the plaintiffs the sum of P910.50, the difference between the assessed
of the trial judge admitting the amendment to the original complaint, is in accord valuation and the price set by the expert appraisal solicited by the plaintiffs in their
with the law and principles of justice, for the reason that any of the coowners of amendment to the complaint; and, (5) that no participation shall be made of
a pro indiviso property, subject to division or sale, is entitled to petition for its jewelry aforementioned now in the possession of the plaintiff Vicenta Ortiz. The
valuation by competent expert appraisers. Such valuation is not prejudicial to any of said judgment, as relates to the points appealed, is affirmed, in so far as its findings
the joint owners, but is beneficial to their interests, considering that, as a general agree with those of this decision, and is reversed, in so far as they do not. No
rule, the assessed value of a building or a parcel of realty is less than the actual real special finding is made regarding the costs of both instances. So ordered.
value of the property, and this being appraiser to determine, in conjunction with
the one selected by the plaintiffs, the value of the properties of joint ownership.
These two experts took part in the latter proceedings of the suit until finally, and
during the course of the latter, the litigating parties agreed to an amicable division
of the pro indiviso hereditary property, in accordance with the price fixed by the
judicial expert appraiser appointed as a third party, in view of the disagreement
between and nonconformity of the appraisers chosen by the litigants. Therefore it
is improper now to claim a right to the collection of the said sum, the difference
between the assessed value and that fixed by the judicial expert appraiser, for the
reason that the increase in price, as determined by this latter appraisal, redounded
to the benefit of both parties.

In consideration of the foregoing, whereby the errors assigned to the lower court
have been duly refuted, it is our opinion that, with a partial reversal of the
judgment appealed from, in so far as it absolves the plaintiffs from the counterclaim
presented by the defendants, we should and hereby do sentence the plaintiffs to
the payment of the sum of P915.08, the balance of the sum claimed by the
defendants as a balance of the one-half of the amount which the defendants
advanced for the reconstruction or repair of the Calle Escolta house, after deducting
from the total of such sum claimed by the latter the amount of P384 which Gaspar
de Bartolome, the husband of the defendant Matilde, should have paid as one-half
of the rents due for his occupation of the quarters on the lower floor of the said
house as an office for the justice of the peace court of Vigan; and we further find:
(1) That the defendants are not obliged to pay one-half of the rents which could
have been obtained from the upper story of the said house; (2) that the plaintiffs
can not be compelled to pay the legal interest from December 7, 1904, on the sum
expanded in the reconstruction of the aforementioned house, but only the interest
fixed by law, at the rate of 6 per cent per annum, from the date of the judgment to
be rendered in accordance with this decision; (3) that the husband of the defendant

16
Property (co-ownership)
4.) Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-2812 October 18, 1906
LONGINOS JAVIER, plaintiff-appellee,
vs.
SEGUNDO JAVIER, ET AL., defendants-appellants.
Hartigan, Rohde and Gutierrez, for appellants.
Chicote, Miranda and Sierra, for appellee.
WILLARD, J.:
This case relates to the ownership of the lot, and of the house standing thereon,
No. 521 Calle Real, Malate, Manila. The court below found that the land belonged
to the plaintiff as administrator of the estate of his father, Manuel Javier, and that
the defendant Isabel Hernandez and Manuel Ramon Javier, her son, are the owners
of the house standing on the lot. Judgment was rendered in favor of the plaintiff for
the possession of the property, but giving the defendants a reasonable opportunity
to remove the house.
The evidence sustains the findings of fact to the effect that the land belongs to the
estate represented by the plaintiff. There was evidence to show that the land was,
in 1860, in the possession of Manuel Javier, the father of the defendant Segundo
Javier, and that since that time it has been occupied by his children and that no one
of these children ever made any claim to the ownership thereof, and no one them
ever occupied the property as owner.
Manuel Ramon Javier, testifying as a witness, made no claim to the ownership of
the land, and testified simply that the result of his investigations into the question
of ownership showed that there was a great confusion in regard thereto.
The appellants claim that this action can not be maintained by the administrator of
the estate of Manuel Javier, but that it should be maintained by all the heirs of the
deceased. The right of judicial administrator to recover the possession of real
property belonging to the estate of the deceased was recognized in the case of
1
Alfonso vs.Natividad (4 Off. Gaz., 461; secs. 702, 703, and 704 of the Code of Civil
Procedure).
The appellants claim in their brief that they were possessors in good faith, and by
reason thereof and of the provisions of article 451 of the Civil Code they can not be
compelled to pay rent. It is to be observed, however, that the appellants do not
come within the definition of a possessor in good faith found in article 433 of the
Civil Code cited in their brief. As said by the appellants themselves in that brief, the
two defendants, Segundo Javier and his wife, Isabel Hernandez, always believed
that the land did not belong to them but belonged to the estate of Manuel Javier. It
is to be observed, moreover, that the judgment of the court does not allow any
recovery at all for the use or occupation of the house, and the recovery of rent for
the use of the land is limited to the time elapsed since April 24, 1904, when a
demand was made upon the defendants for the possession of the property.
It is also claimed by the appellants that, in accordance with article 453 of the Civil
Code, they are entitled to be reimbursed for the expenses of constructing the
house. These expenses are only allowed in accordance with the article cited by the
appellants to a possession in good faith, and the appellants were not such
possessors. lawphil.net
It is claimed finally by the appellants that the case should be decided by an
application of the principles of law meant that community of property existed
because the house was owned by the appellants and the land by the plaintiff, the
contention can not be maintained, for such a condition of affairs does not create a
community of property within the meaning of that term as it is used in title 3, book
2 of the Civil Code. If, on the other hand, it is itself belonged to the heirs of Manuel
Javier, and that two of the defendants were such heirs, it can be said that the
decision of the court below was fully as favorable to the appellants as it could
be.Article 397 of the Civil Code relates to improvements made upon the common
property by one of the coowners. The burden of proof was on the appellants to
show that the house was built with the consent of their cotenants. Even if a tacit
consent was shown this would not require such cotenants to pay for the house. (8
Manresa, Commentaries on Civil Code, p. 396.)The judgment of the court below
allowed the appellants to remove the house within a reasonable time. Whether this
judgment was erroneous as far as the appellee is concerned, we need not inquire,
because he has not appealed from the judgment.The judgment of the court below
is affirmed, with the costs of this instance against the appellants.After the
expiration of twenty days from the date hereof let judgment be entered in
accordance herewith and ten days thereafter let the case remanded to the court
below for proper action. So ordered.
17
Property (co-ownership)
5.) Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-7180 March 30, 1912
RAFAEL ENRIQUEZ, ET AL., plaintiffs-appellants,
vs.
A.S. WATSON & CO. LTD., defendant-appellee.
Rohde and Wright for appellants.
W. A. Kincaid and Thomas L. Hartigan for appellee.
TRENT, J.:
This action was brought on April 12, 1911, by Rafael, Antonio, Trinidad, Cayetano,
Rosario, Gertrudis and Carmen Enriquez, and Antonio Gascon (the latter being a
minor, was represented by his guardian ad litem), as owners and lessors of the
property Nos. 72, 74, an 76 Escolta, city of Manila, against A. S. Watson & Company,
Ltd., as lessee of said property. The plaintiffs allege that on June 22, 1906, Rafael,
Carmen, Antonio, and Trinidad Enriquez and Antonio Gascon executed to the
defendant a contract of mortgage and lease upon their participation in that
property; that on January 19, 1907, the other plaintiffs executed the same
mortgage and lease in favor of the defendant upon their interest in the same
property; that the said contract of lease has been terminated by the payment by
the plaintiffs to the defendant of the principal and interest of the mortgage; that
the said contract of lease is null and of no effect by reason of the minority of the
plaintiff Antonio Gascon, who is still a minor; that the defendant, after June 22,
1906, made all the repairs necessary to its business with the approval of the
plaintiffs.
The plaintiffs further allege that there exists in that building a principal wall about
one meter in thickness and five meters in height, which extends from the front of
the building on the Escolta to the rear of the same; that upon this wall rests the
second floor of the building and that it is necessary to safely maintain the building
against earthquakes and typhoons; that on 11th of April, 1911, the defendant
commenced to destroy and remove the said wall and was on the date of the filing
of this complaint actually engaged in the destruction and removal of the same; and
unless restrained, would continue such destruction and removal, to the irreparable
injury of the plaintiffs; and that the defendant has varied the form and substance of
the leased premises. The plaintiffs therefore prayed that the defendant be
prohibited from destroying and removing said wall; that it be ordered to rebuild or
replace that part which it had removed or destroyed; and that the contract of lease
be declared terminated and rescinded.
On the 12th day of April, 1911, a preliminary injunction was issued by the Court of
First Instance, prohibiting and restraining the defendant from continuing the
removal and destruction of the wall in question, and requiring it to appear in court
on the 17th of that month to show cause why such preliminary injunction should
not be continued in force during the pendency of this action.
On the 21st of that month, the defendant company answered, admitting the
allegations as to the ownership, mortgage, and lease, contained in paragraphs 1, 2,
an 3 of the complaint, and denying all the other allegations therein. The defendant
set up by way of special defense that the wall in question was not a principal wall
and did not extend the entire length of the building; that said wall consisted of two
shells filled with mortar; that it was very old, deteriorated, and weak; that it was
necessary, in order to conserve the property, to remove said wall and to substitute
it with other material; that the wall in question is so located that it and its
subtenant are deprived of the use of a large part of the ground floor fronting on the
Escolta; that under Clause M of the contract of lease, the defendant has the right to
remove the wall, substituting in lieu thereof other material, this being required by
the business established in said building.
As a second special defense, the defendant admits the payment of the mortgage by
the plaintiffs, but alleges that the contract of lease is independent of the mortgage
contract, and that in satisfying the mortgage of the defendant, the leasehold was
specifically continued in force by all parties.
As a third special defense, the defendant alleges that under the provisions of
Paragraph M of the contract of lease, it has expended the sum of over sixty
thousand pesos in improving the leased premises, and that on making such
expenditure it believed that it would be reimbursed by enjoying the occupancy and
subrenting of the premises.
On the 24th day of May, 1911, The Philippines Drug Company, a corporation
organized under the laws of the Philippine Islands, appeared and asked leave to
intervene as an interested party. This leave being granted, it alleged that it is the
actual owner of the pharmacy situated in the leased premises, which formerly
belonged to the defendant A. S. Watson & Company, Ltd.; and that the defendant
sublet to it the ground floor of the leased property under the same conditions as
18
Property (co-ownership)
are expressed in the original contract of lease. The intervener further alleged, as did
the defendant, the necessity for the removal of the wall in question in order to give
it more space as required by its business, and that the removal of this wall was
authorized in Paragraph M of the original lease.
The trial court, after considering the evidence presented, making a personal
inspection of the leased premises, and hearing the arguments of counsel for both
parties, and after making its findings of facts and conclusions of law, entered the
following decree, to wit:
The court denies the rescission and declaration of nullity of the contract of lease
demanded by the plaintiffs, declaring such contract of lease to be valid and
subsisting and binding upon the parties thereto, and upon the sublessee and
intervener, the Philippine Drug Company, and continues and declares final the
preliminary writ of injunction issued herein on the 12th day of April, 1911, but
modifying the same by permitting the defendant, A. S. Watson & Co. Ltd., or the
intervener, the Philippines Drug Company, to remove the wall in question on the
condition that they substitute it with properly constructed concrete pillars and
arches and such other work as may be necessary as specified in Finding No. 17 of
this judgment using such temporary shoring and bracing as shall be necessary to
insure the safety of the building while such change is being made, which work of
removal and substitution may be commenced and carried out upon the defendant
or intervener, or both, filing herein an undertaking in the sum of P10,000 with
sureties approved by the court, conditioned that it or they will reimburse the
plaintiff lessors for any and all damage that may be caused the leased premises by a
failure to take proper precautions and employ proper means to safeguard and
protect the building while such work of removal and substitution is being
accomplished.
From this judgment the plaintiffs appealed and make the following assignment of
errors:
1. The judgment is erroneous in not having declared rescinded the contract of lease.
2. The judgment is erroneous in finding that the lessee and sublessee have the right
to change the form and substance of the property leased.
3. The judgment is erroneous in finding that the lessee acted in good faith in
beginning the destruction of the wall. believing that under the contract of lease it
had the right to do this.
4. The judgment is erroneous in not finding that the building is weakened by the
destruction of the wall.
5. The judgment is erroneous is so far as it modifies the preliminary injunction.
6. The judgment is erroneous in not declaring perpetual the preliminary injunction.
7. The judgment is erroneous in the dispositive part thereof relating to the form and
manner of making the modifications in the property because it does not relate to
anything at issue in the case.
8. The judgment is erroneous in the part relating to the form and manner of making
the modifications in the property because it does not dispose of anything judicially,
but, on the contrary, gives permission to the opposing parties without commanding
them to do anything.
9. The judgment is erroneous because it does not order the repair of the
destruction made in the wall.
10. The judgment is erroneous because it declares valid the contract of lease.
11. The court erred in denying the motion for a new trial.
All the questions in this case may be merged into one, and that is: Did the trial court
err in failing to declare the contract of lease voidable or rescinded for one of two
reasons: first, because of the minority of one of the lessors; and second, because
neither the defendant nor intervener had authority under the contract of lease to
remove the wall in question? Plaintiffs do not now insist that the contract of lease
was terminated on the payment of the mortgage.
The eight plaintiffs each have a one-eight undivided interest in the leased premises.
The property was leased to the defendant for a period of twelve years with
permission to renew the lease for a further period of six years. Seven of these
plaintiffs were of age when they executed this contract of lease. The other, Antonio
Gascon, was a minor. At the time this contract of lease was executed, the minor
was represented by his judicial guardian. The guardian having obtained authority or
permission of the court to enter into this contract of lease for and on behalf of his
ward, the action of the guardian in executing said contract was approved by the
probate court.
Article 1548 of the Civil Code reads:
19
Property (co-ownership)
ART. 1548. The husband can not give in lease the property of the wife, the father
and guardian, that of the son or minor, and the administrator of property, not
having a special power, for a period exceeding six years.
Article 398 of the same code provides:
ART. 398. The decision of a majority of the coowners as to the management and
better enjoyment of the thing owned in common shall be obligatory.
There shall be no majority, unless the resolution has been adopted by the coowners
representing a majority of the interests which constitute the object of the
community.
Should there be no majority, or the resolution of the latter is seriously prejudicial to
the parties interested in the thing owned in common, the judge, at the instance of a
party, shall decree what may be proper, including the appointment of an
administrator.
xxx xxx xxx
Counsel for the plaintiffs do not claim that the contract of lease which was made for
a period of more than six years is seriously prejudicial to the interests of the minor,
nor do they claim that said contract, of itself, prejudices in any way the minor's
interest.
The supreme court of Spain had under consideration this very question in its
resolution of April 26, 1907 (vol. 15 Jurisprudencia referente al Codigo Civil, p. 194).
In this case, a contract of lease for twelve years, executed by one of the coowners
of a certain property, one of whom was a minor, had been presented for registry.
Registry was refused for the reason, among others, the majority of the coowners
lacked authority to execute said contract of lease. It was argued that the majority of
the coowners, in their enjoyment of the control of the management and
administration of the thing, acted in a representative or an administrative capacity
in regard to the minority. In determining the questions presented in this case, the
court said:
That for the administration and better enjoyment of the thing, the decision of the
majority of the coowners is obligatory, and that there is no majority, unless the
decision is made by the coowners, that represent the majority of the interests that
constitute the object of the community, are general rules laid down in article 398 of
the Civil Code, governing community of property.
The contract of lease is by its nature and purpose one of the means of enjoyment or
development of nonfungible property, and, in this concept, may be agreed upon by
the coowners of a thing, provided always that they represent a majority of the
interests of the community, the decision being obligatory for all by virtue of the
powers that are expressly conferred upon them by virtue of said provisions.
If, indeed, the contract of lease of real property for a period exceeding six years, or
in which the rents are advanced for more than three years, constitutes a real right
inasmuch as it is subject to registry, according to the decision of this court in various
resolutions, this principle of law, which has been applied in the sense of not
permitting the execution of such a contract to those who administer the goods of
others, and especially to prevent agents from executing such a contract without
special authority for the same, in accordance with the provisions of article 1713 of
the said code, is not opposed to the principle of law laid down in said article 398;
taking into consideration the legal character and peculiar attributes of community
of property, which makes it convenient and necessary that those who have less
interest therein should submit to those who have a greater participation therein, in
all that refers to the exploitation and ordinary enjoyment of the same, the rule is
established that the enjoyment of the common thing must be subject to the will of
the majority, without distinguishing and limiting the period or the form of the
enjoyment; therefore, the contract of lease being the same in essence whatever the
term for which it is constituted, such a contract must be considered as an act of
mere administration, and subject to contract by the decision of the majority of
coowners, the other interested parties always having the right to appeal to the
court when the decision is gravely prejudicial to them according to the provisions of
the same article 398.
This doctrine was recognized by the supreme court in its decision of June 30, 1897,
and of the 8th of July, 1902, and by this court in its resolution of May 29, 1906,
considering as included in the powers conferred in said article, leases exceeding a
period of six years, decided upon by a majority of the coowners of a property
possessed in common.
The contract of lease of the property referred to in these proceedings, having been
agreed upon by the coowners representing the majority of the interests in the
20
Property (co-ownership)
same, they were possessed of sufficient legal capacity by virtue of what is already
said, and it is, therefore, subject to registry.
In the execution of the contract of lease under consideration, the minor was, as we
have said, represented by his judicial guardian, who not only asked the court for
and obtained authority to execute this contract of lease on behalf of this ward, but
his act, after the execution, was approved by the court. The interest of the minor
has not been prejudiced by reason of the fact that this contract of lease was
executed for a term of more than six years. Under the doctrine laid down by the
supreme court of Spain, it would appear that this contract of lease would be valid if
the minor had not been represented by his guardian. The minor having been
represented by his duly appointed guardian, there can be no question about the
validity of this contract of lease.
The principal question is whether or not the appellees have violated the terms of
the contract of lease and thereby entitle appellants to have said contract of lease
rescinded.
Before considering the contract in question, it might be well to examine the right of
the lessee to make changes in the property leased, if there were no express
stipulation therefor in the contract.
Article 1573 of the Civil Code provides:
A lessee shall have, with regard to the useful and voluntary improvements, the
same rights which are granted the usufructuary.
Article 487 of the same code reads:
The usufructuary may make on the property which is the object of the usufruct any
improvements, useful or for recreation, which he may deem proper, provided he
does not change its form or substance; but he shall have no right to be indemnified
therefor. He may, however, remove said improvements, should it be possible to do
so without injury to the property.
The result is that the lessee may make any improvements, useful or for recreation,
in the property leased that he may deem proper, provided that he does not change
its form or substance. The same obligation is expressed in articles 487 and 489, and
in so far as the form of the thing is concerned, in article 1557. According to article
487 and 1557, the obligations of the lessee and the lessor are the same in the
absence of any agreement to the contrary, in so far as the conservation of the form
of the thing leased is concerned. This question of conserving the form and
substance of the thing leased or the object of the usufruct has been passed upon at
various times by the courts.
In the case of the Manila Building and Loan Association and Pealosa (13 Phil. Rep.,
575), this court said:
If the object leased were a house, it is evident that the lessee might effect such
improvements for use, recreation or comfort as would not change its form or
substance as he deemed fit; he could build a tower or luxurious pavilion more
expensive than the house itself, to which, at the expiration of the lease, the owner
of the house would have no right whatever, unless the lessee could not remove the
same without injury to the house to which it was attached as an improvement,
excepting of course the right to cause the same to be demolished so that the house
might be returned to him in the same condition that the lessee received it; . . . .
The supreme court of Spain, in its judgment of June 24, 1905, volume 14 of the
Jurisprudencia referente al Codigo Civil, page 38, had under consideration the
interpretation of this phrase in a case in which the lessee asked for the rescission of
the lease because the lessor had altered the form of the thing leased. The facts
were that the lessee had leased the house for the period of ten years, and at the
time of the execution of the contract of lease, there was a vacant lot next to the
house and 13 windows of the house lease overlooked this lot. Thereafter the owner
of the adjacent lot constructed an edifice thereon which gave rise to litigation
between the lessor and the owner of the adjacent lot, which litigation was settled
by the lessor and the owner of the said lot, the latter being permitted to cover the
windows of the leased property, and the former allowed to open in the partition
wall of the latter's garden two large and two small windows of specified
dimensions, under certain conditions. The construction was continued, with the
result that such construction effectually closed and covered the 13 windows and
the balcony, depriving the property leased of the light previously received by the
same. For the purpose of obtaining better light, many changes were made and
much work done in the interior of the leased house, the final result being that some
of the rooms of the house were darkened completely, others receiving poor and
indirect ventilation. The court, in refusing to rescind the contract of lease, said:
It does not appear that there is error committed by the trial court in its decision as
set out in the first assignment of error, because, even though the noncompliance by
21
Property (co-ownership)
the lessor of his obligations, among which was that of maintaining the lessee in the
peaceable enjoyment of the lease during the period of the contract, and the
prohibition to change the form of the thing leased, confers upon the lessee the
right to ask for the rescission of the contract, such circumstances are not found in
the present case since the trial court says that the appellant was not disturbed in
the possession of the house, the object of the lease, nor was he impeded from
using the premises as a tavern, for which use he had intended the same, and these
findings of fact have not been legally impugned.
The decision also states that the changes made in the property did not change the
form of the same in the sense and concept covered by article 1557 of the Civil Code.
Notwithstanding that the findings on the point contain legal reasoning now
corresponding to this court, the interpretation of this article can not be made in
general and absolute terms not defined by law, because as a circumstantial fact
depending in each case on the peculiar conditions of the thing leased, there exists
no reason in the case at bar upon which to base the conclusion that the trial court
erred, having in mind that the particular use of the same as a tavern was not
interfered with, as held in its decision, and also the fact set out in its decision, and
not contradicted in any manner, namely, that the changes and alterations made
were beneficial, tolerated by Sabay, and consented to by the person to whom
Sabay transferred his rights under the contract of sublease.
The two last reasons given for the rescission of the contract lack force and weight,
because, in accordance with the sense and concept of article 1561 of the said Civil
Code, the property must be returned at the expiration of the term of lease with the
changes made in the same, and these do not involve, as has already been said, any
variation or change of form or any interruption of the peaceable enjoyment of the
lease and because it does not appear from the facts that the trial court accepted as
proven that the appellant suffered disturbance of his rights for which he had been
compelled to become responsible to the lessor, and he, not having done so, there is
no legal reason to apply, as is attempted, the provisions of article 1560 of the code
referred to.
Manresa, in volume 10 of his commentaries on the Civil Code, pages 534, 535, [488,
489] says:
The question was discussed very energetically as to whether the lessee of a city
property leased for a stated industrial purpose, could install machinery propelled by
steam in substitution for the utilities, implements, and contrivances which were
used before the general adoption of such machinery. The installation of modern
machinery and its ordinary operation, at once caused a deterioration to the estate
much greater than the use of the former apparatus, besides the accidents which
might occur and which produce very great damage to the thing leased. Therefore,
based upon this consideration, it was said that the lessee could not make this
substitution because it implied a bad and prejudicial use of the thing and therefore
very different from that diligence of a good father in its use to which he had
obligated himself.
As Laurent says, there arise here two contrary interests and two diverse tendencies.
The owner has in view the stability of the structure and fears every innovation
which may compromise its preservation. The manufacturer finds himself obliged to
keep abreast of the development of his industry, to make changes, if he does not
wish to perish, and his interests demand that he put into practice the inventions
which increase his profits, even though the edifice may suffer. The owner
commences to resist, adds this writer, but competition forces the manufacturer,
and the owner ends by yielding, if he does not wish to remain unproductive.
This is the essence of the policy pursued by foreign decisions, where the question
has been so much more important than in our own country. Until the year 1860,
judicial decisions were inclined to favor the owner of the property. But from that
year the rights of industry have been recognized with ever increasing clearness. It
has been considered that from the moment the lease is drawn up, in which is stated
the industrial use to which the lessee desires to put the thing leased, the claims of
the industry to which the object of the lease is to be devoted have been
determined, and the lessee can not be condemned to a stagnation which would be
uneconomical, and, these facts admitted, the logical consequences must necessarily
follow: the lessor can not prevent the lessee from adopting the improvements of
his industry; the acts of the parties in making the stipulations in the lease will do the
rest.
The lessee may make on the property which is the object of the lease any
improvements, useful or for recreation, which may be deem proper, provided he
does not change its form or substance. He is obligated to use the thing leased as a
diligent father of a family would, and to return the thing leased at the expiration of
the lease in the same condition in which he received it, except what may have been
destroyed or impaired by time or unavoidable reasons. (Arts. 1573, 487, 1555, and
1561, Civil Code.)
22
Property (co-ownership)
The supreme court of Spain recognizes the fact that no ironclad rules for the enlarge the old bed or purchase a new one" should not be given those provisions of
interpretation of these articles can be laid down which would govern all cases. the Civil Code regarding the obligations of lessees.
These provisions must be applied according to the facts and circumstances of each
case. Manresa is inclined to the view that industrial development should be taken Let us now turn to the contract of lease and the evidence presented. In this contract
into consideration in the determination of questions involved in the application of of lease there are two clauses which deserve careful consideration.
said articles. The provisions of these articles are general rules of law, and, like most
Clause K:
general propositions, are not to be accepted without limitation or reserve, under
any and all circumstances. They must be interpreted in the light of the growth of All the expenditures for cleaning, painting, and repairs which the building may
civilization and varying conditions. Certain obligations are placed upon the lessee to require and all that is ordered done by the Board of Health, will be at the expense
prevent lawless acts which would result in waste or destruction. The importance of of the lessee, A. S. Watson and Company, Limited.
these obligations to the lessor cannot be denied. Especially are they valuable and
essential to the protection of a landlord who rents his premises for a short time. Clause M:
Suppose he has fitted his premises for certain uses and leases them for such uses
The lessee may make such works on the building as the business which it has
for a short term. He would then be entitled to receive them back at the end of the
established therein requires, provided always that neither the strength nor the
term still fitted for those same uses, and he may well say that he does not choose
value of the said building is impaired.
to have a different property returned to him from that which he leased, even if it be
found to be of greater value of reason of the change. But suppose that a It will be noted that the word "reparaciones" is used in Clause K, and the word
usufructuary who has a life interest in an estate should receive as such a hemp "obras" in Clause M. Counsel for the appellants insist that the word "obras" as thus
hacienda, and that in a short time this hacienda should become permanently used means the same as "reparaciones." The Encyclopedic Dictionary of the
unproductive through disease or death of the plants, or by change of the market Castilian Language (Diccionario Enciclopedico de la Lengua Castellana) defines these
conditions, and the land to have become far more valuable, by reason of new words as follows:
conditions, as rice or sugar land. Is the usufructuary to be compelled to preserve or
renew the useless hemp fields and forego the advantages to be derived from a OBRA:
different use? Or, suppose a life tenant should change warehouses into dwelling
houses on the ground that by change of conditions the demand for warehouses had 1. A thing made or produce by an agent.
ceased and the property had become worthless, whereas it would be very valuable
xxx xxx xxx
when fitted for dwelling houses. Would this be such a change in the form or
substance of the thing leased as to forfeit the interest of the tenant? Again, a lessee 4. A building in course of construction.
for a long term received, during very prosperous times, a hemp hacienda upon
which were constructed large and valuable storehouses in which were the old style REPARACION:
hand-presses, but new. Later, on account of a complete change in conditions due to
1. The action an effect of repair. (Reparar-verb: To mend, to straighten, or correct
the market and the method of pressing hemp by steam, the lessee allowed the
the damage suffered by something.)
buildings and presses, which had become useless, to fall into decay rather than
incur the expense of repair. Would a prudent owner of the fee, if in possession, The New Dictionary of the Castilian Language (Nuevo Diccionario de la Lengua
have done the same? These questions naturally suggest their own answer. The Castellana) defines the same words as follows:
radical and permanent changes of surrounding conditions must always be an
important consideration in the determination of such questions. The interpretation OBRA:
that "if the man is too long for the bed his head should be chopped off rather than

23
Property (co-ownership)
Anything made, created, or produced by the some power or agent. Any
construction of architecture, masonry, or carpentry, applied especially to buildings
in course of construction or repair, as: "There are three jobs in Calle Hortaleza.
Everything in my house is disordered and topsy-turvy because of the work."
REPARACION:
The act or effect of repairing or of being repaired. The fact of the repairing, in the
sense of renewing or improving something.
The only synonym given in this work for "obra" is produccion."
It may be that repairs are included in the definition of "obras." Nevertheless, it
cannot be denied that the word "obras," used in its general sense, has a far more
comprehensive meaning than just simple repairs.
Sections 290 and 293 of the Code of Civil Procedure, provide:
SEC. 290. Terms of a writing presumed to be in their ordinary sense. The terms of
a writing are presumed to have been used in their primary and general acceptation,
but evidence is nevertheless admissible that they have a local, technical or
otherwise peculiar signification, and were so used and understood in the particular
instance, in which case the agreement must be construed accordingly.
SEC. 293. Where intention of different parties to instrument not the same. When
the terms of an agreement have been intended in a different sense by the different
parties to it, that sense is to prevail against either party in which he supposed the
other understood it; and when different constructions of a provision are otherwise
equally proper, that is to be taken which is the most favorable to the party in whose
favor the provision was made.
In the case at bar no proof has been presented tending to show that the word
"obras" was used in a technical or special sense, or that it has a local signification,
and therefore, it must be considered as used in its ordinary and general sense. If
there exist any ambiguity and if the meaning that the appellants give to the word
"obras" is proper, the meaning given by the appellees is likewise proper,
consequently, we must apply the rule laid down in section 293, above quoted, for
the reason that the stipulation contained in Clause M of the contract is a stipulation
in the favor of the lessee.
Counsel for appellants insist that in order to define the meaning of the word
"obras" we should refer to the articles of the Civil Code that deal with contracts of
lease. This might be done in those cases where the intention of the parties could
not be ascertained from either the contract itself or from the conduct of the parties
in executing and carrying out the same. In the case at bar, all that is necessary is to
give a fair and reasonable interpretation to the meaning of clause M of the contract
of lease. This clause contains certain limitations on the exercise of the right to make
alterations (obras): first, the alterations (obras) proposed to be made must be
required by the business; second, such alterations must not injure the solidity of the
building; and third, the same must not prejudice the value of the building. But it is
insisted, as we have said, that the word "obras" in clause M must be interpreted to
mean "reparaciones" as used in Clause K. Clause K imposes upon the lessee the
obligation to make the repairs required by the building for its conservation. If the
words have exactly the same meaning and were intended by the parties to mean
the same thing, then the insertion of clause M would only have had the effect of
giving to the lessee the right to keep the building in repair, when, as a matter of
fact, Clause K made it its duty to repair the building. As we understand the contract,
in Clause K a duty is imposed upon the lessee, while in Clause M a right is given to it.
In Clause K the word "reparaciones" is used in connection with the duty, and in
clause M the word "obras" is used in connection with the right. If the contracting
parties had intended that the two words be used in the same sense they would
have so stated, or they would have eliminated Clause M entirely as being useless, as
it is meaningless to say that when a duty is imposed upon a person it is necessary to
expressly give him a right to perform that duty. If he did not have the right to
perform that duty, the same would not have been imposed upon him. The
stipulations in Clause M are expressed as clearly and explicitly as they could have
been under the circumstances. At the time of the execution of this contract of
lease, it was impossible to know what would be the requirements of the business
during its term of eighteen years. It was likewise impossible for the parties to have
then agreed in detail as to the changes that might be necessary. The lessee wished
to reserve to itself the right to make the changes in the property required by its
business, and none of the parties could anticipate what might be required during
this long period of time. This right was conferred upon the lessee by the lessors, but
the right, as we have said, had its limitations: that is, the lessee could not prejudice
the solidity or the value of the building without breaking the contract.
The question was raised as to whether the conduct of the parties in carrying out the
terms of this lease has been such as to show or indicate their intention or
24
Property (co-ownership)
understanding of the meaning of the word "obras" when they inserted this word in
Clause M. Upon this point the trial court said:
That under and by virtue of the said contract of lease, the defendant company
entered into possession of the leased premises, making therein alterations and
repairs at a cost of some P60,000, including the removal of the whole front of the
building facing upon the Escolta and replacing the same upon the new street line,
established by the city of Manila, with a modern and a decorative commercial front;
the removal of the heavy tiled roof and the replacing of the same with a light
galvanized roof; the removal of various walls and replacing the same with steel
columns and girders; the tearing down and rebuilding of a part of the building and
the adding thereto of a camarin upon the Pasig River; and the building of a river
wall and reclamation of a considerable amount of ground; and which alteration
included the removal of that part of the wall in question which extended from point
A to point G on the plan of the premises introduced in evidence as defendant's
Exhibit No. 9, all of which repairs, alterations and improvements, were made with
final approval of the plaintiffs, although after much controversy and many
disagreements, and to which alterations and improvements the plaintiffs
contributed the sum of about eighteen hundred pesos paid by the city of Manila for
the expropriation for street purposes of the small strip along the front of the
building heretofore mentioned.
These findings of fact are, we think, fully supported by the evidence. The result is
that these important and material changes, which include the removal of a great
portion of the very wall in question, were made by virtue of the contract of lease
itself. It is true that the owners objected at first, but afterwards consented in
accordance with the provisions of Clause M, and not by reason of any subsequent
specific agreement. After all, that the defendants have the right under the law and
the provisions of Clause M of the contract of lease to remove the wall in question,
cannot be seriously doubted, provided always that neither the solidity of the
building nor its value be impaired.
Let us now determine whether or not a removal of the wall in question (1) will
prejudice either the solidity of the building or its value, and (2) if it is required by
the business of the defendants.
The walls which the defendants and interveners propose to remove and substitute
in lieu thereof other material is composed of two outer shells of Guadalupe or
Meycauayan stone, filled with lime, plaster and rubber, the two shells being bound
together by stones laid transversely, the whole wall was so formed being about one
meter thick and extending from the front of the building a distance of about 38
meters toward the Pasig River. This wall is about four meters high, extending from
the ground floor to the second floor. The joists and girders supporting the second
floor are embedded in said wall. There are two actual openings in this wall, with
three doors and an arch, which have been walled up. The wall is in good condition,
except that part removed by the defendants before the commencement of this
action, and said wall is one of the longitudinal walls, all being approximately of the
same thickness. The wall in question divides the east half of the ground floor of the
building approximately in its center and sustains a part of the weight of the second
floor of this east half, together with a partition forming one of the divisions of the
second floor. But it does not sustain any of the weight of the roof, this weight being
distributed by means of trusses to the outer walls of the building. About one-third
of this wall, or that part nearest the Pasig has already been removed, and the
removal of the same was approved by the owners. The interveners now propose to
remove the remaining two-thirds and substitute in lieu thereof other material,
using the material of the old wall for filing up certain openings in other walls of the
building. This old wall, according to the experts, offers very little resistance to
lateral shocks or motions. Practically all of the resistance of lateral shocks or
motions is furnished by the cross-walls. Again, according to the opinion of the
experts the building will be greatly strengthened against earthquakes or unusual
shocks or force, and its durability increased by the removal of the remaining part of
the wall in question and the substitution in lieu thereof of reinforced concrete posts
or pillars and arches, taking the material and filing, as the interveners propose to
do, the openings in some of the other walls. Such proposed removal, if carried out,
will practically double the floor space of the drug store and greatly increase its
rental value, and also greatly increase the actual value of the building. This extra
floor space is absolutely essential to the business carried on in this part of the
building. The foregoing are substantially the findings of the trial court, based upon
the testimony of expert witnesses, and an ocular inspection of the premises. These
facts show clearly and beyond a question that the removal of the remainder of this
old wall will not only prejudice the solidity of the building, but greatly increase its
solidity and durability, as, according to the opinion of the experts, the reinforced
concrete posts and arches will offer greater resistance to earthquakes or bagious
than the old wall; that both the intrinsic and rental value of the building will be
increased; and that this removal is required by the business.
Lastly, counsel for the appellants say:
25
Property (co-ownership)
The plaintiffs contend that a contract is only binding on the parties thereto as This right is a part of the lease itself and affects directly the thing leased. It is not,
provided in article 1257 of the Civil Code and that, although a sublessee is bound to therefore, a personal obligation between the lessors and the lessee.
the lessor as provided in articles 1551 and 1552 yet this is not an obligation arising
out of contract but one founded in law and the relation of the parties to property, We are, therefore, of the opinion that the judgment appealed from should be
and that the lessor has no obligation towards the sublessee as such at all either affirmed with costs against the appellant.
legal or of contract and that therefore even if by clause (m) of the lease of the
plaintiffs had the obligation to permit the defendant to take out the wall to suit the
convenience of its own business, that such an obligation was purely personal
between the parties to the lease and since the contract of lease is not assignable
this right could not be transferred by the defendant or made use of by the
defendant for the benefit of other persons.

A lease may be of things, works, or services. (Art. 1542, Civil Code.) In a lease of
things, one of the parties thereto binds himself to give to the other the enjoyment
or use of a thing for a specified time and for a fixed price. (Art. 1543, idem.)

Article 1550 of the Civil Code reads:

Should it not be expressly forbidden in the contract of the lease of things, the lessee
may sublet the whole or a part of the things leased without prejudice to his liability
for the fulfillment of the contract executed with the lessor.

There is nothing in the contract of lease in the case at bar which even tends to
prohibit the lessee from subletting the whole or any part of the leased premises.
The lessee's right to do this cannot be questioned, and his subtenant is not only
obligated to carry out his part of the contract with the sublessor, but he is also
bound to the lessors for all of the acts which refer to the use and preservation of
the premises, in the manner agreed upon between the lessors and the lessee. The
lessors can compel the subtenant to comply with these conditions. This sets up the
privity between the lessors and the subtenant. But it is said that the contract of
lease in question is not assignable. This contract is an ordinary one, under which the
lessee as we have said, has a perfect right to sublet the whole of the premises for
the entire time. Should the lessee do this, would it not amount to an assignment of
the contract of the lease? The power of assignment is incident to the state of every
lessee of things, unless he has been restrained by the terms of his lease. In the
contract of lease in question, the lessors, by Clause M, agree that the lessee may
make such changes as its business requires, provided that neither the solidity nor
the value of the building is prejudiced. This is a specific right granted to the lessee.

26
Property (co-ownership)
6.) Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-32047 November 1, 1930
MANUEL MELENCIO, MARIANO MELENCIO, PURA MELENCIO, and CARIDAD
MELENCIO, plaintiffs-appellants,
vs.
DY TIAO LAY, defendant-appellee.
Jose V. Valladolid, Jose P. Melencio and Camus and Delgado for appellants.
Araneta and Zaragoza for appellee.
OSTRAND, J.:
On August 1,1927, the plaintiffs, Manuel, Mariano, Pura and Caridad Melencio,
brought the present action against the defendant-appellee, Dy Tiao Lay for the
recovery of the possession of a parcel of land situated in the town of Cabanatuan,
Nueva Ecija, and containing an area of 4,628.25 square meters. The plaintiffs
further demand a monthly rental of P300 for the use and occupation of the parcel
from May, 1926, until the date of the surrender to them of the possession thereof;
and that if it is found that the said appellee was occupying the said parcel of land by
virtue of a contract of lease, such contract should be declared null and void for lack
of consent, concurrence, and ratification by the owners thereof.
In his answer, the defendant pleaded the general issue, and as special defenses, he
alleged in substance that he was occupying the said tract of land by virtue of a
contract of lease executed on July 24,1905, in favor of his predecessor in interest,
by Ruperta Garcia, Pedro Melencio, Juliana Melencio, and Ruperta Melencio under
the terms specified therein, and which contract is still in force; that Liberata
Macapagal, the mother of the plaintiffs, in her capacity as judicial administratrix of
the estate of Ramon Melencio, one of the original coowners of the parcel of land in
question, actually recognized and ratified the existence and validity of the contract
aforesaid by virtue of the execution of a public document by her on or about
November 27,1920, and by collecting from the assignees of the original lessee the
monthly rent for the premises until April 30, 1926; and that said defendant deposits
with the clerk of court the sum of P20.20 every month as rent thereof and that as a
counterclaim, he seeks the recovery of P272 for goods and money delivered by him
to the plaintiffs.
The plaintiffs filed a reply to the answer alleging, among other things, that Ruperta
Garcia was not one of the coowners of the land in question; that the person who
signed the alleged contract of lease never represented themselves as being the sole
and exclusive owners of the land subject to the lease as alleged by the defendant in
his answer; that the said contract of lease of July 24,1905, is null and void for being
executed without the intervention and consent of two coowners, Ramon Melencio
and Jose P. Melencio, and without the marital consent of the husbands of Juliana
and Ruperta Melencio; that the lessee has repeatedly violated the terms and
conditions of the said contract; and that Liberata Macapagal, in her capacity as
administratrix of the property of her deceased husband, could not lawfully and
legally execute a contract of lease with the conditions and terms similar to that of
the one under consideration, and that from this it follows that she could not ratify
the said lease as claimed by the defendant.
On January 21,1928, Liberata Macapagal Viuda de Melencio, duly appointed and
qualified as administratrix of the estate of her deceased husband, Ramon Melencio,
filed a petition praying to be allowed to join the plaintiffs as party to the present
case, which petition was granted in open court on January 31,1928. Her amended
complaint of intervention of February 14,1928, contains allegations similar to those
alleged in the complaint of the original plaintiffs, and she further alleges that the
defendant-appellee has occupied the land in question ever since November, 1920,
under and by virtue of a verbal contract of lease for a term from month to month.
To this complaint of intervention, the defendant-appellee filed an answer
reproducing the allegations contained in his answer reproducing the allegations
contained in his answer to the complaint of the original plaintiffs and setting up
prescription as a further special defense.
It appears from the evidence that the land in question was originally owned by one
Julian Melencio. He died prior to the year 1905 leaving his widow, Ruperta Garcia,
and his five children, Juliana, Ramon, Ruperta, Pedro R., and Emilio Melencio. Emilio
Melencio also died before 1905, his son Jose P. Melencio, then a minor, succeeding
to his interest in the said parcel of land by representation. A question has been
raised as to whether the land was community property of the marriage of Julian
27
Property (co-ownership)
Melencio and Ruperta Garcia, but the evidence is practically undisputed that
Ruperta Garcia in reality held nothing but a widow's usufruct in the land.
On July 24,1905, Ruperta Garcia, Pedro R. Melencio, Juliana Melencio, and Ruperta
Melencio executed a contract of lease of the land in favor of one Yap Kui Chin, but
neither Jose P. Melencio nor Ramon Melencio were mentioned in the lease. The
term of the lease was for twenty years, extendible for a like period at the option of
the lessee. The purpose of the lessee was to establish a rice mill on the land, with
the necessary buildings for warehouses and for quarters for the employees, and it
was further stipulated that at the termination of the original period of the lease, or
the extension therof, the lessors might purchase all the buildings and
improvements on the land at a price to be fixed by experts appointed by the
parties, but that if the lessors should fail to take advantage of that privilege, the
lease would continue for another and further period of twenty years. The document
was duly acknowledged but was never recorded with the register of deeds. The
original rent agreed upon was P25 per month, but by reason of the construction of
a street through the land, the monthly rent was reduced of P20.20.
Shortly after the execution of the lease, the lessee took possession of the parcel in
question and erected the mill as well as the necessary buildings, and it appears that
in matters pertaining to the lease, he dealt with Pedro R. Melencio, who from 1905
until his death in 1920, acted as manager of the property held in common by the
heirs of Julian Melencio and Ruperta Garcia. The original lessee, Yap Kui Chin, died
in 1912, and the lease, as well as the other property, was transferred to Uy Eng Jui
who again transferred it to Uy Eng Jui & Co., an unregistered partnership. Finally the
lease came into the hands of Dy Tiao Lay, the herein defendant-appellee.
Ramon Melencio died in 1914, and his widow, Liberata Macapagal, was appointed
administratrix of his estate. In 1913 the land which includes the parcel in question
was registered under the Torrens system. The lease was not mentioned in the
certificate of title, but it was stated that one house and three warehouses on the
land were the property of Yap Kui Chin.
In 1920 the heirs of Julian Melencio made an extrajudicial partition of parts of the
inheritance, and among other things, the land here in question fell to the share of
the children of Ramon Melencio, who are the original plaintiffs in the present case.
Their mother, Liberata Macapagal, as administratrix of the estate of her deceased
husband, Ramon, collected the rent for the lease at the rate of P20.20 per month
until the month of May,1926, when she demanded of the lessee that the rent
should be increased to P300 per month, and she was then informed by the
defendant that a written lease existed and that according to the terms thereof, the
defendant was entitled to an extension of the lease at the original rental. The
plaintiffs insisted that they never had any knowledge of the existence of such a
contract of lease and maintained that in such case the lease was executed without
their consent and was void. It may be noted that upon careful search, a copy of the
contract of lease was found among the papers of the deceased Pedro R, Melencio.
Thereafter the present action was brought to set aside the lease and to recover
possession of the land. Upon trial, the court below rendered judgment in favor of
the defendant declaring the lease valid and ordering the plaintiffs to pay the P272
demanded by the defendant in his counterclaim. From this judgment the plaintiffs
appealed.
The contention of the appellants is that the aforesaid contract of lease (Exhibit C) is
null and void for the following reasons:
1. That Exhibit C calls for an alteration of the property in question and therefore
ought to have been signed by all the coowners as by law required in the premises.
2. That the validity and fulfillment of the said agreement of lease were made to
depend upon the will of the lessee exclusively.
3. That the said contract of lease being for a term of over six years, the same is null
and void pursuant to the provision of article 1548 of the Civil Code.
4. That the duration of the same is unreasonably long, thus being against public
policy.
5. That the defendant-appellee and his predecessors in interest repeatedly violated
the provisions of the agreement.
The first proposition is based on article 397 of the Civil Code which provides that
"none of the owners shall, without the consent of the others, make any alterations
in the common property even though such alterations might be advantageous to
all." We do not think that the alterations are of sufficient importance to nullify the
lease, especially so since none of the coowners objected to such alterations until
over twenty years after the execution of the contract of lease. The decision of this
court in the case of Enriquez vs. A. S. Watson and Co. (22 Phil., 623), contains a full
discussion of the effect of alterations of leased community property, and no further
discussion upon the point need here be considered.
28
Property (co-ownership)
The second proposition is likewise of little merit. Under the circumstances, the
provision in the contract that the lessee, at any time before he erected any building
on the land, might rescind the lease, can hardly be regarded as a violation of article
1256 of the Civil Code.
The third and fourth proposition are, in our opinion, determinative of the
controversy. The court below based its decision principally on the case of Enriquez
vs. A.S. Watson & Co. (22 Phil., 623), and on the resolution of the Direccion General
de los Registros dated April 26,1907. (Jurisprudencia Civil, vol.107, p. 222.) An
examination of the Enriquez case will show that it differs materially from the
present. In that case all of the coowners of a lot and building executed a contract of
lease of the property for the term of eighteen years in favor of A. S. Watson & Co.;
one of the owners was minor, but he was represented by his legally appointed
guardian, and the action of the latter in signing the lease on behalf of the minor was
formally approved by the Court of First Instance. In the present case only a small
majority of the coowners executed the lease here in question, and according to the
terms of the contract the lease might be given a duration of sixty years; that is
widely different from a lease granted by all of the coowners for a term of only
eighteen years.
The resolution of April 26,1907, is more in point. It relates to the inscription or
registration of a contract of lease of some pasture grounds. The majority of the
coowners of the property executed the lease for the term of twelve years but when
the lessees presented the lease for inscription in the registry of property, the
registrar denied the inscription on the ground that the term of the lease exceeded
six years and that therefore the majority of the coowners lacked authority to grant
the lease. The Direccion General de los Registros held that the contract of lease for a
period exceeding six years, constitutes a real right subject to registry and that the
lease in question was valid.
The conclusions reached by the Direccion General led to considerable criticism and
have been overruled by a decision of the Supreme Court of Spain dated June
1,1909. In that decision the court made the following statement of the case
(translation):
The joint owners of 511 out of 1,000 parts of the realty denominated El
Mortero, leased out the whole property for twelve years to Doa Josefa de la Rosa;
whereupon the Count and Countess Trespalacios together with other coowners
brought this suit to annul the lease and, in view of the fact that the land was
indivisible, prayed for its sale by public auction and the distribution of the price so
obtained; they alleged that they neither took part nor consented to the lease; that
the decision of the majority of part owners referred to in article 398 of the Code,
implies a common deliberation on the step to be taken , for to do without it, would,
even more than to do without the minority, be nothing less than plunder; and that,
even if this deliberation were not absolutely necessary, the power of the majority
would still be confined to decisions touching the management and enjoyment of
the common property, and would not include acts of ownership, such as a lease for
twelve years, which according to the Mortgage Law gives rise to a real right, which
must be recorded, and which can be performed only by the owners of the property
leased.
The part owners who had executed the contract prayed in reconvention that it held
valid for all the owners in common, and if this could not be, then for all those who
had signed it, and for the rest, for the period of six years; and the Audiencia of
Caceres having rendered judgment holding the contract null and void, and ordering
the sale of the realty and the distribution of the price, the defendants appealed
alleging under the third and fourth assignments of error, that the judgment was a
violation of article 398 of the Civil Code, which is absolute and sets no limit of time
for the efficacy of the decisions arrived at by the majority of the part owners for the
enjoyment of the common property, citing the decisions of June 30th, 1897, of July
8th,1902, and of October 30th, 1907; under the fifth assignments of error the
appellants contended that in including joint owners among those referred to in said
article, which sets certain limits to the power of leasing, in the course of the
management of another's property, the court applied article 1548 unduly; and by
the seventh assignments of error, they maintained the judgment appealed from
also violated article 1727, providing that the principal is not bound where his agent
has acted beyond his authority; whence it may be inferred that if in order to hold
the contract null and void, the majority of the part owners are looked upon as
managers or agents exercising limited powers, it must at least be conceded that in
so far as the act in question lies within the scope of their powers, it is valid; the
contract cannot be annulled in toto.
The Supreme Court held that the appeal from the decision of the Audiencia of
Caceres was not well taken and expressed the following consideranda:
Considering that, although as a rule the contract of lease constitutes an act of
management, as this court has several times held, cases may yet arise, either owing
to the nature of the subject matter, or to the period of duration, which may render
29
Property (co-ownership)
it imperative to record the contract in the registry of property, in pursuance of the
Mortgage Law, where the contract of lease may give rise to a real right in favor of
the lessee, and it would then constitute such a sundering of the ownership as
transcends mere management; in such cases it must of necessity be recognized that
the part owners representing the greater portion of the property held in common
have no power to lease said property for a longer period than six years without the
consent of all the coowners, whose propriety rights, expressly recognized by the
law, would by contracts of long duration be restricted or annulled; and as under
article 1548 of the Civil Code such contracts cannot be entered into by the husband
with respect to his wife's property, by the parent or guardian with respect to that of
the child or ward, and by the manager in default of special power, since the
contract of lease only produces personal obligations, and cannot without the
consent of all persons interested or express authority from the owner, be extended
to include stipulations which may alter its character, changing it into a contract of
partial alienation of the property leased;
Considering that, applying this doctrine to the case before us, one of the grounds
upon which the judgment appealed from, denying the validity of the lease made by
the majority of the part owners of the pasture land El Mortero is based, must be
upheld; to wit, that the period of duration is twelve years and the consent of all the
coowners has not been obtained; hence, the third, fourth. and fifth assignments of
error are without merit; firstly, because article 398 of the Civil Code, alleged to have
been violated, refers to acts decided upon by the majority of the part owners,
touching the management and enjoyment of the common property, and does not
contradict what we have stated in the foregoing paragraph; secondly because
although the cases cited were such as arose upon leases for more than six years, yet
this point was not raised on appeal, and could not therefore be passed upon; and
thirdly, because it cannot be denied that there is an analogy between a manager
without special authority, who is forbidden by article 1548 of the Code to give a
lease for a period of over six years, and the joint owners constituting a legal
majority, who may decide to lease out the indivisible property, with respect to the
shares of the other coowners; and having come to the conclusion that the contract
is null and void, there is no need to discuss the first two assignments of error which
refer to another of the bases adopted, however erroneously, by the trial court;
Considering that the sixth assignment of error is without merit, inasmuch as the
joint ownership of property is not a sort of agency and cannot be governed by the
provisions relating to the latter contract; whence, article 1727 of the Code alleged
to have been violated, can no more be applied, than, the question of the validity or
nullity of the lease being raise, upon the contract as celebrated, it would be
allowable to modify a posteriorisome one or other of the main conditions
stipulated, like that regarding the duration of the lease, for this would amount to a
novation; still less allowable would it be to authorize diverse periods for the
different persons unequally interested in the fulfillment.
Taking into consideration articles 398,1548, and 1713 of the Civil Code and
following the aforesaid decision of June 1,1909, we hold that the contract of lease
here in question is null and void.
It has been suggested that by reason of prescription and by acceptance of benefits
under the lease, the plaintiffs are estopped to question the authority for making the
lease.To this we may answer that the burden of proof of prescription devolved
upon the defendant and that as far as we can find, there is no proof that Ramon
Melencio and his successors ever had knowledge of the existence of the lease in
question prior to 1926. We cannot by mere suspicion conclude that they were
informed of the existence of the document and its terms; it must be remembered
that under a strict interpretation of the terms of the lease, the lessees could remain
indefinitely in their tenancy unless the lessors could purchase the mill and the
buildings on the land. In such circumstances, better evidence than that presented
by the defendant in regard to the plaintiff's knowledge of the lease must be
required.
The fact that Ramon during his lifetime received his share of the products of land
owned in common with his coheirs is not sufficient proof of knowledge of the
existence of the contract of lease when it is considered that the land in question
was only a small portion of a large tract which Pedro R. Melencio was administering
in connection with other community property.
The appealed judgment as to the validity of the lease is therefore reversed, and it is
ordered that the possession of the land in controversy be delivered to the
intervenor Liberata Macapagal in her capacity as administratrix of the estate of the
deceased Ramon Melencio. It is further ordered that the defendant pay to said
administratrix a monthly rent of P50 for the occupation of the land from May 1st,
1926, until the land is delivered to the administratrix. The sum of P272 demanded
by the defendant in his counterclaim may be deducted from the total amount of the
rent due and unpaid. The building erected on the land by the defendant and his
predecessors in interest may be removed by him, or otherwise disposed of, within
six months from the promulgation of this decision. Without costs. So ordered.
30
Property (co-ownership)
7.) [G.R. No. 2426. January 24, 1906. ]
FERNANDO MONTANO LOPEZ, Plaintiff-Appellee, v. PEDRO MARTINEZ
ILUSTRE, Defendant-Appellant.
Hartigan, Marple, Rohde & Gutierrez, for Appellant.
Carlos Casademunt, for Appellee.
SYLLABUS
1. REALTY; TENANTS IN COMMON; SALE OF UNDIVIDED INTEREST; PARTITION.
M. and the defendant were owners as tenants in common of twenty-eight separate
tracts of land. M. sold to the plaintiff his undivided one-half interest in two of these
tracts by contract with pacto de retro. Before the right to repurchase had expired
M. and the defendant made a voluntary partition between themselves of the
twenty-eight tracts, by which partition the two tracts in which the plaintiff was
interested fell to the defendant. M. did not exercise his right of repurchase. Held,
That the partition between M. and the defendant did not affect the plaintiff, and
that he was the owner of an undivided one-half of the two lots in question
DECISION
WILLARD, J. :
On the 26th day of December, 1902, Francisco Martinez and the defendant, Pedro
Martinez, his son, were the owners as tenants in common of two separate parcels
of land in Calle Dulumbayan, in the city of Manila, each being the owner of an
undivided one-half of each of said tracts of land. On the 26th day of December,
1902, Francisco Martinez conveyed to the plaintiff his undivided half interest in
both said tracts of land. This deed contained a clause giving Martinez the right to
repurchase the property within one year from December 26, 1902. He did not
repurchase it, and on the 28th of December, 1903, the plaintiff caused the proper
marginal entry to be made upon the books in the registry of property in which
registry the conveyance had been recorded, and afterwards brought this action in
March, 1904, asking for a partition of the two lots of land, between himself and the
defendant, and that defendant account for and pay to the plaintiff his part of the
rents of the said properties from the 26th day of December, 1903.
It appeared that Francisco Martinez and the defendant, his son, were the owners as
tenants in common of twenty-six other parcels of land; that in June, 1903, before
the expiration of the year in which Francisco Martinez had the right to repurchase
the property so conveyed to the plaintiff, he and the defendant, his son, made a
voluntary partition of these twenty-eight tracts of land, which partition was
approved by the Court of First Instance of Manila on the 15th day of June, 1903.
These twenty-eight tracts of land had been acquired by Francisco Martinez during
his marriage with his wife, Dona Germana Ilustre. The wife having died, her estate
was in process of administration in the Court of First Instance of Manila, and the
partition above mentioned was made on the theory that these lands were the
property of the conjugal partnership existing between Francisco Martinez and his
wife. In this partition the two parcels of land in question in this case fell to the
defendant, and his claim is that by this partition plaintiff lost all his interest in the
property. Judgment was entered in the court below in favor of plaintiff as prayed
for in his complaint, and the defendant has brought the case here by bill of
exceptions.
Article 399 of the Civil Code is as follows:jgc:chanrobles.com.ph
"Every coowner shall have full ownership of his part and in the fruits and benefits
derived therefrom, and he therefore may alienate, assign, or mortgage it, and even
substitute another person in its enjoyment, unless personal rights are in question.
But the effect of the alienation or mortgage, with regard to the coowners, shall be
limited to the share which may be awarded him in the division on the dissolution of
the community."cralaw virtua1aw library
This article gives the owner of an undivided interest in the property the right to
freely sell and dispose of it - that is, of his undivided interest. He has no right to sell
a divided part of the real estate. If he is the owner of an undivided half of a tract of
land, he has a right to sell and convey an undivided half, but he has no right to
divide the lot into two parts, and convey the whole of one part by metes and
bounds. All that Francisco Martinez undertook to do in this case was to convey his
undivided interest in these two properties. This he had a perfect right to do, in
accordance with the terms of said article. There is nothing in the last clause of the
article inconsistent with this position. That declares simply that when the property
is divided the purchaser gets an interest only in that part which may be assigned to
him. For the purposes of this case we see no difference between it and a case in
which the tenant in common makes an absolute conveyance of his undivided
31
Property (co-ownership)
interest in the property, without reserving the right to repurchase. In the case of an
absolute conveyance of that character, the relation between the grantor in the
deed and his cotenant is terminated. They are no longer cotenants. The grantee in
the deed takes the place of the grantor, and he and the other owner of the
property become cotenants. In such a case the grantor loses all interest in the
property, and of course has no right to take any part in the partition of it. It would
be absurd to say that after such conveyance the grantor, who had lost all his
interest in the property, could by agreement with the other owner make a partition
of property in which he had no interest that would be binding upon his grantee.

We do not see how the fact that Francisco Martinez and his son were the owners of
other pieces of property as tenants in common can affect the question presented in
this case. Each tract was separate and distinct from all others. The parties had a
right to deal with one lot without any reference to the other twenty-seven. The fact
that the defendant acquired title to all of them by inheritance from his mother did
not make them physically one tract of land, so that a conveyance by the son of his
undivided half interest in one of these lots would amount to a conveyance of a
divided part of a tract of land held by him in common with his father.

The judgment of the court below is affirmed, with the costs of this instance against
the appellant, and after the expiration of twenty days judgment should be entered
in accordance herewith and the case remanded to the court below for execution. So
ordered.

32
Property (co-ownership)
8.) Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-5075 December 1, 1909
MAURICIO RAMIREZ, administrator of the estate of MOISES RAMIREZ,
deceased, plaintiff-appellee,
vs.
SIMEON BAUTISTA, ET AL., defendants-appellants.
Perfecto J. Salas Rodriguez for appellants.
Teodoro Gonzalez for appellee.
ARELLANO, C. J.:
The subject of this complaint is two fish ponds, left by Moises Ramirez on his
demise, and subsequently illegally sold. This action was brought for the purpose of
having the sale declared to be void, to secure the recovery of possession of the fish
ponds, their restitution to the administrator of the estate of the deceased owner,
and indemnity for damages.
Moises Ramirez, who died intestate in February, 1900, was married twice. By the
first marriage he had five children, named Rosa, Carmen, Francisco, Mauricia, and
Ignacia; by the second marriage three, to wit, Cirila, Isabel, and Serapio, of whom
Isabel alone survives. At the time of his death he left two fish ponds in the sitio of
Tagalag, in the municipality of Polo, Province of Bulacan, the specific details of
which are described and admitted in the case. The two wives are also dead.
The children of the first marriage, Rosa, Carmen, Francisco, Mauricia, and Ignacia,
sold the two fish ponds on the 28th of November, 1901, to Simeon Bautista and
Raymundo Duran for the sum of 1,100 pesos. The only surviving child of the second
marriage, Isabel, was not a party to said sale, hence the suit now filed by the
administrator of the intestate estate to have the sale declared null and void and the
fish ponds restored to the intestate estate of Moises Ramirez.
The two purchasers proved their purchase by two documents, one of which was a
private and other a notarial one executed for the purpose. When summoned to
answer the complaint they requested that the vendors be cited also, but the latter
although so summoned did not appear at trial.
The action was proceeded with against the purchasers and the Court of First
Instance of Bulacan, before whom the matter was heard, rendered judgment
holding that the fish ponds in question pertained to the intestate estate of the late
Moises Ramirez, and that the sale effected by the said Rosa, Carmen, Francisco,
Mauricia, and Ignacia to the defendants, Simeon Bautista and Raymundo Duran,
was null and void. The court decreed that possession of the fish ponds be restored
to the plaintiff, Mauricio Ramirez as administrator of the property of the late
Moises Ramirez, and accorded him the right to recover from the defendants 200
pesos per annum, as loss and damages, to commence from the day they were
notified of the complaint, without prejudice to their right, which was reserved to
them, of action against the said vendors; the court also sentenced the defendants
to pay the costs.
From the above judgment the defendants appealed. The appeal having been heard
before this court, together with the respective allegations of the parties, it appears
that the appellants have made the following assignments of error to the judgment
of the lower court:
I. In that it was not in the judgment the children of the late Moises Ramirez, of both
the first and the second marriage, had become owners in common of the two fish
ponds in question by reason of the death of their ancestor.
II. In that it was found therein that, without a partition having been made of the
property left by Moises Ramirez, the children of his first marriage could not validly
have transmitted their rights of partition in common to the property which is the
subject of this suit.
III. In that sale of the thirteen-sixteenths of the two parcels of land in question was
not declared valid, and void as to three-sixteenths thereof.lawphi1.net
IV. In that it was not found that, as a result of the evidence, the plaintiff had no
legal capacity to bring suit.
The appeal having been heard and the evidence reviewed, the following facts must
be held to have been proven:
That Moises Ramirez was first married to Apolinaria Guillermo and by her had the
above-mentioned five children, Rosa, Carmen, Francisco, Mauricia, and Ignacia
Ramirez.
33
Property (co-ownership)
That by his second wife, Alejandra Capistrano, he had three children, as already
stated, named Cirila, Isabel, and Serapio Ramirez.
That Moises Ramirez and his two wives are now dead, as are also the two children
of the second marriage, Cirila and Serapio. Isabel, a girl of about eight years of age,
alone survives.
That the two fish ponds in question were acquired by Moises Ramirez during the
time of his first marriage with Apolinaria Guillermo, on the 17th of March, 1895,
which is the date of the title by composition with the Spanish Government that
constitutes his title of ownership.
On this supposition, the two fish ponds in litigation belonged to the conjugal
partnership between Moises Ramirez and Apolinaria Guillermo. (Civil Code, art.
1401, par. 1.)
By virtue of the conjugal partnership, these two fish ponds belonged half to the
husband and half to the wife upon the dissolution of the marriage by reason of the
death of either of them.itc@alf (Civil Code, art. 1392.)
Consequently, upon the death of Apolinaria Guillermo one-half of the fish ponds
belonged to Moises Ramirez, and the other half, that belonging to Apolinaria
Guillermo, to the children of the said married couple, Rosa, Carmen, Francisco,
Mauricia, and Ignacia, as the lawful heirs of their mother. (Civil Code, art. 931.)
Inasmuch as the said property continued undivided between the father on the one
hand and the children on the other, and as the conjugal partnership had
terminated, a community of property maintained the father and the children in the
joint dominion. (Civil Code, art. 392.)
By the second marriage three additional children survived the father, and upon his
death the first five children, together with the latter three, became his heirs, and all
are entitled to divide the said half share belonging to their father into eight parts.
By the death of two of these last three children, their respective shares fell to Isabel
sole heir, inasmuch as they were children of the same parents. (Civil Code art. 947.)
In view of these considerations, the claim of the appellants is entirely legal that
thirteen-sixteenths should be apportioned among the children of the first marriage
to wit, eight as their own, already inherited from their mother, Apolinaria
Guillermo, and five subsequently inherited from their deceased father, Moises
Ramirez and three-sixteenths should be the share of the three children of the
second marriage, which accrued to Isabel Ramirez.
Therefore, in the succession of Moises Ramirez that is now opened the whole of
these fractional parts can not be included, but only the eight which actually
constitute his share in the community of property maintained by him with his
children of the first marriage, Rosa, Carmen, Francisco, Mauricia, and Ignacia, since
the death of his first wife.
The above children of the first marriage, upon the death of Moises Ramirez,
continued the aforesaid community of property with their three half sisters and
brother, Cirila, Isabel, and Serapio; that is to say, now with Isabel, their share being
thirteen-sixteenths, and that of Isabel three sixteenths.
The present status of the two fish ponds in question is that of community of
property.
It is certain that when two or more heirs appear at the opening of a testamentary
succession, or during the progress of the settlement of an intestate estate, and
each turns out to be an owner pro indiviso of the inheritance, by reason of the
share he may be entitled to receive, a community of property then exists between
the participants as long as the estate remains undivided . . . and nothing more
tangible can be imagined than this necessary community, which arose at the
moment when the coheirs assumed the entire representation of the person of the
deceased with respect to all of his property, rights, and actions, both active and
passive. (3 Manresa, 357.)
With regard to the community of property the Civil Code provides that
Every coowner shall have full ownership of his part and in the fruits and benefits
derived therefrom, and he therefore may alienate, assign, or mortgage it, and even
substitute another person in its enjoyment, unless personal rights are in question.
But the effect of the alienation or mortgage, with regard to the coowners, shall be
limited to the share which may be awarded him in the division on the dissolution of
the community. (Art. 399, Civil Code.)
If Rosa, Carmen, Francisco, Mauricia, and Ignacia Ramirez could lawfully alienate
their respective shares in the joint ownership of the two parcels of land sold to the
defendants, Simeon Bautista and Raymundo Duran, it is evident that the sale of
thirteen-sixteenths of the said two lands could not be void; the sale of the three-
34
Property (co-ownership)
sixteenths which belonged to Isabel alone is illegal, as alleged in the third
assignment of error.
Therefore, the sale described in the public instrument of the 29th of November,
1901, of the thirteen-sixteenths which belonged to the vendors is valid, and that of
the three-sixteenths which pertain to Isabel, who neither by herself nor by means
of another took part in said sale is null.
In view of the foregoing, it is our opinion that the judgment appealed from should
only be affirmed in so far as it declares that the sale made by Rosa, Carmen,
Francisco, Mauricia, and Ignacia Ramirez of the three-sixteenths parts belonging to
Isabel Ramirez in the two fish ponds claimed is null and void; in all other respects
the said judgment is hereby reversed, without any special ruling as to the costs of
both instances. So ordered.

Simeon Bautista and Raymundo Duran succeed to the vendors and are subrogated
thereto in the joint ownership of the two fish ponds sold; their shares are the same
that were owned by the vendors, that is, thirteen-sixteenths.

The whole of the two fish ponds can not pertain to the intestate estate of Moises
Ramirez, but merely the half that belonged to him and which at his death became a
part of his intestate estate.

Intestate succession can not disturb the lawful holder in his possession of property,
which it is thought should constitute a part of the hereditary property.

Only in the event of a division of the common property, or upon dissolution of the
community of property now existing between the purchasers, Simeon Bautista and
Raymundo Duran, on the one hand and Isabel Ramirez on the other, can the fruits,
rents, or benefits received, and the part thereof, as well as of the expenses,
corresponding to the coowner Isabel Ramirez in maintaining the community, be
considered, as well as of the rights and actions that may pertain to the purchasers
as against the vendors (who have taken no part in these proceedings), by reason of
the total consideration paid for the two properties, and other obligations which
may have arisen because of the sale.

The present cause of action and the complaint based thereon being limited to the
recovery of the two properties in question, and the restitution of the possession
thereof to the administrator of the intestate estate of Moises Ramirez, in
consequence of the latter's hereditary succession, it is evident that neither recovery
of possession nor the restitution asked for can be granted, as the defendants are
the legitimate proprietors and possessors in joint ownership of the greater portion
of the common property claimed.

While the question of the nullity of the entire sale was previously raised in the
action, the illegality of the sale of three-sixteenths of the common property made
by the vendors is evident.

35
Property (co-ownership)
9.) Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-3404 April 2, 1951
ANGELA I. TUASON, plaintiff-appellant,
vs.
ANTONIO TUASON, JR., and GREGORIO ARANETA, INC., defendants-appellees.
Alcuaz & Eiguren for appellant.
Araneta & Araneta for appellees.
MONTEMAYOR, J.:
In 1941 the sisters Angela I. Tuason and Nieves Tuason de Barreto and their brother
Antonio Tuason Jr., held a parcel of land with an area of 64,928.6 sq. m. covered by
Certificate of Title No. 60911 in Sampaloc, Manila, in common, each owning an
undivided 1/3 portion. Nieves wanted and asked for a partition of the common
property, but failing in this, she offered to sell her 1/3 portion. The share of Nieves
was offered for sale to her sister and her brother but both declined to buy it. The
offer was later made to their mother but the old lady also declined to buy, saying
that if the property later increased in value, she might be suspected of having taken
advantage of her daughter. Finally, the share of Nieves was sold to Gregorio
Araneta Inc., a domestic corporation, and a new Certificate of Title No. 61721 was
issued in lieu of the old title No. 60911 covering the same property. The three co-
owners agreed to have the whole parcel subdivided into small lots and then sold,
the proceeds of the sale to be later divided among them. This agreement is
embodied in a document (Exh. 6) entitled "Memorandum of Agreement" consisting
of ten pages, dated June 30, 1941.
Before, during and after the execution of this contract (Exh. 6), Atty. J. Antonio
Araneta was acting as the attorney-in-fact and lawyer of the two co-owners, Angela
I. Tuason and her brother Antonio Tuason Jr. At the same time he was a member of
the Board of Director of the third co-owner, Araneta, Inc.
The pertinent terms of the contract (Exh. 6) may be briefly stated as follows: The
three co-owners agreed to improve the property by filling it and constructing roads
and curbs on the same and then subdivide it into small lots for sale. Araneta Inc.
was to finance the whole development and subdivision; it was prepare a schedule
of prices and conditions of sale, subject to the subject to the approval of the two
other co-owners; it was invested with authority to sell the lots into which the
property was to be subdivided, and execute the corresponding contracts and deeds
of sale; it was also to pay the real estate taxes due on the property or of any portion
thereof that remained unsold, the expenses of surveying, improvements, etc., all
advertising expenses, salaries of personnel, commissions, office and legal expenses,
including expenses in instituting all actions to eject all tenants or occupants on the
property; and it undertook the duty to furnish each of the two co-owners, Angela
and Antonio Tuason, copies of the subdivision plans and the monthly sales and
rents and collections made thereon. In return for all this undertaking and obligation
assumed by Araneta Inc., particularly the financial burden, it was to receive 50 per
cent of the gross selling price of the lots, and any rents that may be collected from
the property, while in the process of sale, the remaining 50 per cent to be divided in
equal portions among the three co-owners so that each will receive 16.33 per cent
of the gross receipts.
Because of the importance of paragraphs 9, 11 and 15 of the contract (Exh. 6), for
purposes of reference we are reproducing them below:
(9) This contract shall remain in full force and effect during all the time that it may
be necessary for the PARTY OF THE SECOND PART to fully sell the said property in
small and subdivided lots and to fully collect the purchase prices due thereon; it
being understood and agreed that said lots may be rented while there are no
purchasers thereof;
(11) The PARTY OF THE SECOND PART (meaning Araneta Inc.) is hereby given full
power and authority to sign for and in behalf of all the said co-owners of said
property all contracts of sale and deeds of sale of the lots into which this property
might be subdivided; the powers herein vested to the PARTY OF THE SECOND PART
may, under its own responsibility and risk, delegate any of its powers under this
contract to any of its officers, employees or to third persons;
(15) No co-owner of the property subject-matter of this contract shall sell, alienate
or dispose of his ownership, interest or participation therein without first giving
preference to the other co-owners to purchase and acquire the same under the
same terms and conditions as those offered by any other prospective purchaser.
Should none of the co-owners of the property subject-matter of this contract
exercise the said preference to acquire or purchase the same, then such sale to a
third party shall be made subject to all the conditions, terms, and dispositions of
36
Property (co-ownership)
this contract; provided, the PARTIES OF THE FIRST PART (meaning Angela and
Antonio) shall be bound by this contract as long as the PARTY OF THE SECOND
PART, namely, the GREGORIO ARANETA, INC. is controlled by the members of the
Araneta family, who are stockholders of the said corporation at the time of the
signing of this contract and/or their lawful heirs;
On September 16, 1944, Angela I. Tuason revoked the powers conferred on her
attorney-in-fact and lawyer, J. Antonio Araneta. Then in a letter dated October 19,
1946, Angela notified Araneta, Inc. that because of alleged breach of the terms of
the "Memorandum of Agreement" (Exh. 6) and abuse of powers granted to it in the
document, she had decided to rescind said contract and she asked that the
property held in common be partitioned. Later, on November 20, 1946, Angela filed
a complaint in the Court of First Instance of Manila asking the court to order the
partition of the property in question and that she be given 1/3 of the same
including rents collected during the time that the same including rents collected
during the time that Araneta Inc., administered said property.
The suit was administered principally against Araneta, Inc. Plaintiff's brother,
Antonio Tuason Jr., one of the co-owners evidently did not agree to the suit and its
purpose, for he evidently did not agree to the suit and its purpose, for he joined
Araneta, Inc. as a co-defendant. After hearing and after considering the extensive
evidence introduce, oral and documentary, the trial court presided over by Judge
Emilio Pea in a long and considered decision dismissed the complaint without
pronouncement as to costs. The plaintiff appealed from that decision, and because
the property is valued at more than P50,000, the appeal came directly to this Court.
Some of the reasons advanced by appellant to have the memorandum contract
(Exh. 6) declared null and void or rescinded are that she had been tricked into
signing it; that she was given to understand by Antonio Araneta acting as her
attorney-in-fact and legal adviser that said contract would be similar to another
contract of subdivision of a parcel into lots and the sale thereof entered into by
Gregorio Araneta Inc., and the heirs of D. Tuason, Exhibit "L", but it turned out that
the two contracts widely differed from each other, the terms of contract Exh. "L"
being relatively much more favorable to the owners therein the less favorable to
Araneta Inc.; that Atty. Antonio Araneta was more or less disqualified to act as her
legal adviser as he did because he was one of the officials of Araneta Inc., and
finally, that the defendant company has violated the terms of the contract (Exh. 6)
by not previously showing her the plans of the subdivision, the schedule of prices
and conditions of the sale, in not introducing the necessary improvements into the
land and in not delivering to her her share of the proceeds of the rents and sales.
We have examined Exh. "L" and compared the same with the contract (Exh. 6) and
we agree with the trial court that in the main the terms of both contracts are similar
and practically the same. Moreover, as correctly found by the trial court, the copies
of both contracts were shown to the plaintiff Angela and her husband, a broker,
and both had every opportunity to go over and compare them and decide on the
advisability of or disadvantage in entering into the contract (Exh. 6); that although
Atty. Antonio Araneta was an official of the Araneta Inc.; being a member of the
Board of Directors of the Company at the time that Exhibit "6" was executed, he
was not the party with which Angela contracted, and that he committed no breach
of trust. According to the evidence Araneta, the pertinent papers, and sent to her
checks covering her receive the same; and that as a matter of fact, at the time of
the trial, Araneta Inc., had spent about P117,000 in improvement and had received
as proceeds on the sale of the lots the respectable sum of P1,265,538.48. We quote
with approval that portion of the decision appealed from on these points:
The evidence in this case points to the fact that the actuations of J. Antonio Araneta
in connection with the execution of exhibit 6 by the parties, are above board. He
committed nothing that is violative of the fiduciary relationship existing between
him and the plaintiff. The act of J. Antonio Araneta in giving the plaintiff a copy of
exhibit 6 before the same was executed, constitutes a full disclosure of the facts, for
said copy contains all that appears now in exhibit 6.
Plaintiff charges the defendant Gregorio Araneta, Inc. with infringing the terms of
the contract in that the defendant corporation has failed (1) to make the necessary
improvements on the property as required by paragraphs 1 and 3 of the contract;
(2) to submit to the plaintiff from time to time schedule of prices and conditions
under which the subdivided lots are to be sold; and to furnish the plaintiff a copy of
the subdivision plans, a copy of the monthly gross collections from the sale of the
property.
The Court finds from the evidence that he defendant Gregorio Araneta,
Incorporated has substantially complied with obligation imposed by the contract
exhibit 6 in its paragraph 1, and that for improvements alone, it has disbursed the
amount of P117,167.09. It has likewise paid taxes, commissions and other expenses
incidental to its obligations as denied in the agreement.
37
Property (co-ownership)
With respect to the charged that Gregorio Araneta, Incorporated has failed to
submit to plaintiff a copy of the subdivision plains, list of prices and the conditions
governing the sale of subdivided lots, and monthly statement of collections form
the sale of the lots, the Court is of the opinion that it has no basis. The evidence
shows that the defendant corporation submitted to the plaintiff periodically all the
data relative to prices and conditions of the sale of the subdivided lots, together
with the amount corresponding to her. But without any justifiable reason, she
refused to accept them. With the indifferent attitude adopted by the plaintiff, it
was thought useless for Gregorio Araneta, Incorporated to continue sending her
statement of accounts, checks and other things. She had shown on various
occasions that she did not want to have any further dealings with the said
corporation. So, if the defendant corporation proceeded with the sale of the
subdivided lots without the approval of the plaintiff, it was because it was under
the correct impression that under the contract exhibit 6 the decision of the majority
co-owners is binding upon all the three.
The Court feels that recission of the contract exhibit 6 is not minor violations of the
terms of the agreement, the general rule is that "recission will not be permitted for
a slight or casual breach of the contract, but only for such breaches as are so
substantial and fundamental as to defeat the object of the parties in making the
agreement" (Song Fo & Co. vs. Hawaiian-Philippine Co., 47 Phil. 821).
As regards improvements, the evidence shows that during the Japanese occupation
from 1942 and up to 1946, the Araneta Inc. although willing to fill the land, was
unable to obtain the equipment and gasoline necessary for filling the low places
within the parcel. As to sales, the evidence shows that Araneta Inc. purposely
stopped selling the lots during the Japanese occupantion, knowing that the
purchase price would be paid in Japanese military notes; and Atty. Araneta claims
that for this, plaintiff should be thankfull because otherwise she would have
received these notes as her share of the receipts, which currency later became
valueles.
But the main contention of the appellant is that the contract (Exh. 6) should be
declared null and void because its terms, particularly paragraphs 9, 11 and 15 which
we have reproduced, violate the provisions of Art. 400 of the Civil Code, which for
the purposes of reference we quote below:
ART. 400. No co-owner shall be obliged to remain a party to the community. Each
may, at any time, demand the partition of the thing held in common.
Nevertheless, an agreement to keep the thing undivided for a specified length of
time, not exceeding ten years, shall be valid. This period may be a new agreement.
We agree with the trial court that the provisions of Art. 400 of the Civil Code are not
applicable. The contract (Exh., 6) far from violating the legal provision that forbids a
co-owner being obliged to remain a party to the community, precisely has for its
purpose and object the dissolution of the co-ownership and of the community by
selling the parcel held in common and dividing the proceeds of the sale among the
co-owners. The obligation imposed in the contract to preserve the co-ownership
until all the lots shall have been sold, is a mere incident to the main object of
dissolving the co-owners. By virtue of the document Exh. 6, the parties thereto
practically and substantially entered into a contract of partnership as the best and
most expedient means of eventually dissolving the co-ownership, the life of said
partnership to end when the object of its creation shall have been attained.
This aspect of the contract is very similar to and was perhaps based on the other
agreement or contract (Exh. "L") referred to by appellant where the parties thereto
in express terms entered into partnership, although this object is not expressed in
so many words in Exh. 6. We repeat that we see no violation of Art. 400 of the Civil
Code in the parties entering into the contract (Exh. 6) for the very reason that Art.
400 is not applicable.
Looking at the case from a practical standpoint as did the trial court, we find no
valid ground for the partition insisted upon the appellant. We find from the
evidence as was done by the trial court that of the 64,928.6 sq. m. which is the total
area of the parcel held in common, only 1,600 sq. m. or 2.5 per cent of the entire
area remained unsold at the time of the trial in the year 1947, while the great bulk
of 97.5 per cent had already been sold. As well observed by the court below, the
partnership is in the process of being dissolved and is about to be dissolved, and
even assuming that Art. 400 of the Civil Code were applicable, under which the
parties by agreement may agree to keep the thing undivided for a period not
exceeding 10 years, there should be no fear that the remaining 1,600 sq. m. could
not be disposed of within the four years left of the ten-years period fixed by Art.
400.
We deem it unnecessary to discuss and pass upon the other points raised in the
appeal and which counsel for appellant has extensively and ably discussed, citing
numerous authorities. As we have already said, we have viewed the case from a
practical standpoint, brushing aside technicalities and disregarding any minor
38
Property (co-ownership)
violations of the contract, and in deciding the case as we do, we are fully convinced
that the trial court and this Tribunal are carrying out in a practical and expeditious
way the intentions and the agreement of the parties contained in the contract (Exh.
6), namely, to dissolve the community and co-ownership, in a manner most
profitable to the said parties.

In view of the foregoing, the decision appealed from is hereby affirmed. There is no
pronouncement as to costs.

So ordered.

39
Property (co-ownership)
10.) Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-10104 February 10, 1916
ROMANA CORTES, ET AL., plaintiffs-appellants,
vs.
FLORENCIO G. OLIVA, defendant-appellee.
Leodegario Azarraga for appellants.
Jose Agoncillo for appellee.
CARSON, J.:
This is an action for the recovery of personal property and for the damages incident
to its alleged unlawful conversion.
The plaintiffs are the heirs of one Pio Oliva, deceased, who during his lifetime was
the owner of a large machine used for grinding sugar cane; he was also the joint
owner with his brother, Florencio Oliva, the defendant herein, of another smaller
machine used for the same purpose. Throughout the record the machine owned
outright by Pio Oliva is referred to as the large machine or mill (trapiche grande)
while the other is referred to as the small or partnership machine.
In 1896 defendant was the manager of an hacienda in Nasugbu, Batangas, and Pio
Oliva was a tenant on the hacienda. The two machines in question were installed
and in use on the hacienda at the time of the breaking out of the revolution against
Spain. Owing to the unsettled conditions incident to the revolution, the hacienda
was abandoned together with the two machines in question and various other
agricultural implements. Pio Oliva died in 1898 in the pueblo of Calawang, Laguna,
P. I., leaving as his heirs the plaintiffs herein. The defendant, Florencio Oliva,
returned to Nasugbu in 1899. In 1901 he took them in an abandoned condition and
badly in need of repairs. On the large machine he expended approximately P163
and a less amount on the smaller machine, and he kept both machines under
shelter until work was received on the hacienda. In 1906 the large machine was
again used for grinding cane and it appears to have been used for that purpose ever
since. The smaller machine, the one owned in partnership, has never been used
since 1896, and unsuccessful efforts have been made to sell it. The record is very
unsatisfactory and inconclusive as to the value of the two machines. One of the
plaintiffs testified that the large machine was worth P1,200, while the defendant
put its value at P400. There is no direct evidence in the record as to what the value
of the smaller machine is, but it is very clear that its market value must be small
indeed.
The plaintiffs contend that the defendant unlawfully took possession of these
machines in the year 1906 without their knowledge or consent; that from that date
until the year 1912 he had ground cane in the large machine to the value of
P42,000, and that they, as the heirs of the true owner of the machine, are entitled
to P14,000 for the use of this machine, that being one third the estimated value of
the output; that the profits which would have accrued to them from the use of the
small machine during that period amounts to P3,500; that they are entitled to a
judgment for the recovery of the machines of their value; and further to a judgment
for the sum of P17,500 for the profits which should have accrued to them for the
use of these machines from the year 1906 to the year 1912.
The defendant contends that he took possession of the machines in 1901, and has
them in his possession since that date under a claim of ownership; that he took
possession because his brother, Pio Oliva, was indebted to him at the time of his
death, and in view of conditions existing at that time, 1901, he took this mode of
indemnity himself against loss of the amount of the indebtedness which exceeded
the value of both machines at the time when he took possession.
This action was instituted on the 6th day of June, 1913, and the trial judge was of
opinion that it had prescribed under the provisions of section 43 of the new Code of
Civil Procedure (Act No. 190), the evidence of record disclosing that the defendant
had been in possession of both the mills under a claim of ownership for a period of
more than four years prior to the date of the institution of the action.
As to larger machine, we are of opinion that the ruling of the trial judge was
unquestionably correct. We find nothing in the record which would justify us in
disturbing the findings of fact by the trial judge and there can be no doubt that
accepting his finding of facts as correct, the plaintiff's action for possession had
prescribed long before the action was instituted (sec. 43 Act No. 190).
The plaintiff contend that the defendant did not take and keep possession of this
machine under a claim of ownership; and that in truth and in fact he originally took
possession of this machine in the year 1906, and that since that time he has kept
possession merely as security for his claim of indebtedness against their father. In
support of their contentions, they rely on certain statements made by the
defendant in a letter written to one of the plaintiffs. This letter appears to have
been written partly with a view to secure some compromise of the threatened
40
Property (co-ownership)
litigation over the machines, and partly by way of justification and defense of the
defendant's conduct in taking possession of the machines after his brother's death.
In the course of the letter he insists that the plaintiffs were not wronged by his
action in taking possession, because, as he indicates, their claim of ownership in the
machine and of profits from its operation is fully met by his claim of indebtedness
and of interest on the debt. Plaintiffs insist that this statement demonstrates that
the defendant was not asserting a right of ownership in the machine at the time
when the letter was written, but only the right to payment of the amount of the
alleged indebtedness with interest.
Without stopping to consider the question of the admissibility in evidence of the
contents of his letter, which seems to have been written with some view to a
compromise of threatened litigation, we hold that, read in connection with all the
evidence of record, it falls far short of sustaining the contentions of the plaintiffs.
We agree with the trial judge, who carefully reviewed the letter together with all
the rest of the evidence, and held that the letter, as a whole, clearly discloses that
defendant regarded himself as the lawful owner of the machine at the time when
the letter was written; and that the references to the principal and interest of the
debt for which it was taken was made by the defendant merely for the sake of
showing that he had not wronged his brother or his brother's heirs by taking the
machines for the debt.
With reference to the smaller machine, which was originally owned jointly by the
defendant and his brother, the claim of prescription of the action brought by the
plaintiffs is not satisfactorily established.
think that the evidence or record is sufficient to sustain a finding to that effect with
reference to the small machine.
On their own allegations, however, plaintiffs cannot maintain an action for
possession of this machine against the defendant, who was originally a joint with
his brother, their predecessor in interest. Doubtless they have a right to have the
machine sold and to a partition of the proceeds of the sale, and an accounting for
profits while in the exclusive possession of the defendant; and liberally construed,
the allegations of their complaint would seem to be sufficient, if supported by
competent evidence to entitle them to a judgment for such profits.
But there is no direct evidence in the record as to profits gained by the defendant
from the use of this machine, though there are indications in the record that in fact
he made no such profits, and that the machine, which was practically worthless, has
lain idle ever since it came into his possession.
The judgment entered in the court below dismissing the complaint at costs of the
plaintiffs should be affirmed with the costs of this instance against the appellants,
without prejudice, nevertheless, to the right of the plaintiffs to bring another action
asserting any right they may have in the small machine, originally owned jointly by
the defendant and his brother, their predecessor in interest, or in profits arising
from the use of this machine since the date of the institution of this action. So
ordered.

This machine having been originally the joint property of the defendant and his
brother, the fact that he held it in his possession for a long period of years, and
exercised acts of ownership with reference to it does not afford a sufficient ground
for the inference he had possession under a claim of exclusive ownership, and
adverse to the claims of his brother's estate. Ordinarily possession by one joint
owner will not be presumed to be adverse to the others, but will, as a rule, be held
to be for the benefit of all. Much stronger evidence is required to show an adverse
holding by one of several joint owners than by a stranger; and in such cases, to
sustain a plea of prescription, it must always clearly appear that one who was
originally a joint owner has repudiated the claims of his coowners, and that his
coowners were apprised or should have been apprised of his claim of adverse and
exclusive ownership before the alleged prescriptive period began to run. We do not

41
Property (co-ownership)
11.) Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-38544 November 18, 1933
PAZ DE SANTOS, CONSUELO DE SANTOS and JOSE MARIANO DE
SANTOS, petitioners-appellants,
vs.
BANK OF THE PHILIPPINE ISLANDS, oppositor-appellee.
Vicente J. Francisco for appellants.
Feria and La O for appellee.
VILLA-REAL, J.:
This is an appeal taken by the petitioners herein Paz, Consuelo and Jose Mariano de
Santos, from the order of the Court of First Instance of Manila, which reads as
follows:
Upon consideration of the petition filed by Paz, Consuelo and Jose Mariano de
Santos praying that this court order the cancellation of the lien annotated on their
certificates of title consisting in the preliminary attachment of the properties
described therein, in favor of the Bank of the Philippine Islands; it appearing that
this same motion had already been previously filed, that is on July 6, 1931, and
denied by this same court; it appearing likewise, that a similar petition had been
filed in civil case No. 39435 of the Court of First Instance of Manila, entitled "Bank
of the Philippine Islands vs. Isidoro de Santos et al., which petition was also denied
by the said court which heard the motion in question on September 30, 1931; and it
appearing further that aid order have not been appealed from and have therefore
become final on the ground that the period fixed by law within which they might
have been again considered by this court has elapse; and it appearing furthermore
that the provisions of the Civil Code and of the Code of Civil Procedure cited by the
petitioners in their motion under consideration by this court are not applicable to
nor can serve as a ground for the aforesaid motion filed by them, inasmuch as they
contain nothing with reference to liens in favor of third persons who are not a party
to the partition in question;
Wherefore, the petition of the aforesaid petitioners herein is hereby denied. It is so
ordered.
In support of their appeal, the petitioner-appellants assign the following alleged
errors in the decision of the court a quo, to wit:
1. In not ordering the cancellation of the preliminary attachment noted at the back
of the new certificates of title Nos. 39885, 39879 and 39880 issued respectively to
each of the three herein appellants for their respective shares in the community
property.
2. In holding the orders of the court of July 31, and of September 30, 1931
mentioned in the appealed order, as binding and conclusive in the instant case.
3. In ordering the appellants to include in their bill of exceptions the
aforementioned order of September 30, 1931, which was issued in the case of
the Bank of the Philippine Islands vs. Isidoro de Santos et al., No. 39435, by the
judge of the Sala other than the one in which the present case was heard.
The following pertinent facts are necessary for the solution of the questions raised
in this appeal:
The petitioner-appellants herein Paz, Consuelo and Jose Mariano de Santos,
together with their brothers Felipe and Isidoro de Santos, were owners pro
indiviso of nine parcels of land described in the transfer certificates of title Nos.
34394, 34395, 34396, 34397, 34398, 34399, 34400, 34403 and 34530.
On March 26, 1930, Isidoro de Santos and Paulino Candelaria executed jointly and
severally in favor of the herein oppositor-appellee, Bank of the Philippine Islands, a
promissory note for the sum of P45,000 payable within ninety days with interest at
the rate of 9 per cent per annum, delivering the promissory note in question
(Appendix B) to the aforesaid bank.
Inasmuch as Isidoro de Santos and Paulino Candelaria failed to pay the amount of
the said promissory note upon maturity and after demand had been made upon
them therefore the aforesaid oppositor-appellee, Bank of the Philippine Islands, on
April 18, 1931, filed a complaint against Isidoro de Santos and Paulino Candelaria
with the Court of First Instance of Manila, praying for the issuance of a writ of
preliminary attachment against their properties, which was issued and annotated
on the back of each and every one of the transfer certificates of the hereinbefore
enumerated.
42
Property (co-ownership)
Three days after the issuance of said writ of attachment and the annotation thereof
on the back of the aforesaid transfer certificates of title, that is on April 21, 1931,
the herein petitioner-appellants, together with Isidoro and Felipe de Santos
executed an extrajudicial partition of the parcels of land in question.
On July 6, 1931, Felipe de Santos filed a motion in Cadastral Case No. 3 and others,
G.L.R.O. Record No. 63 and others, of the Court of First Instance of Manila, praying
among other things, (1) that the aforesaid extrajudicial partition be approved by the
court, and (2) that the preliminary attachment of the interest of Isidoro de Santos in
each and every one of the nine parcels of land described in the transfer certificates
of the title hereinbefore enumerated, be consolidated into parcels of land
adjudicated to him by virtue of the aforesaid extrajudicial partition.
Although the petitioner-appellants herein and Isidoro de Santos were duly notified
of the hearing of the aforesaid motion which was set for July 14, 1931, as evidenced
by the notice and the note of Attorney Javier appearing at the foot thereof, none of
them appeared at the hearing.
On July 31, 1931, the Court of First Instance of Manila, in deciding the aforesaid
motion of Felipe de Santos, stated the following:
The petition is hereby denied with respect to the properties described in the
transfer certificates of title Nos. 34396, 34398 and 34403, on the ground that the
first two properties are mortgaged to Luis Mirasol and the last to the Philippine
Guaranty Co., Inc., inasmuch as the mortgage constituted thereon is subscribed to
jointly and severally by all the coowners thereof. The motion to the effect that all
the attachments issued against Isidoro de Santos be consolidated exclusively on the
properties adjudicated to him by virtue of the aforesaid deed of partition is,
likewise hereby denied.
Neither the petitioner Felipe de Santos nor the herein petitioner-appellants Paz,
Consuelo and Jose Mariano de Santos, nor Isidoro de Santos excepted to nor
appealed from the order above-mentioned.
On September 30, 1931, the Court of First Instance of Manila denied the motion
filed by Felipe de Santos in civil case No. 39435 of the said court, wherein he
prayed, among other things, that the said court order the register of deeds of the
City of Manila to note on the back of transfer certificates of title Nos. 34397 and
34530 the preliminary attachment in favor of the Bank of the Philippine Islands,
referring to that portion of the property described in subdivision plan Psd 7299, and
to cancel the preliminary attachments noted on the back of transfer certificates of
title Nos. 34394, 34395, 34396, 34398, 34400 and 34403, and on the back of
transfer certificate of title No. 34530 with respect to the portion of the property
described therein, which was ]adjudicated to the said petitioner. The court has
based its aforesaid decision of the ground that neither the said petitioner Felipe de
Santos nor the defendant therein, Isidoro de Santos, has the right to compel the
plaintiff Bank of the Philippine Islands to conform to the attachment of only those
properties adjudicated to the said defendant Isidoro de Santos by virtue of the deed
of partition, in lieu of his right to an undivided one-fifth of each of the nine parcels
of land hereinbefore enumerated.lawphil.net
Neither the petitioner Felipe de Santos nor the defendant therein, Isidoro de
Santos, appealed from the above order.
On August 3, 1932, one-year after the motion of Felipe de Santos was filed in the
said civil case No. 39435, the herein petitioner-appellants filed a motion in the
cadastral cases aforementioned, praying for the cancellation of the annotation of
the preliminary attachments levied on the interest of Isidoro de Santos before the
partition, appearing on the back of the new transfer certificates of title issued in
their name after the partition, said annotation having been made pursuant to the
order of the court issued in said cadastral cases on July 31, 1931.
On September 17, 1932, the court denied the motion in question by the aforesaid
order from which this appeal was taken.
It being procedural in nature, we shall first pass upon the question raised in the
second assignment of error, to wit; that the trial court erred in holding the orders of
the court of July 31, and September 30, 1931, as binding and conclusive in the
instant case.
It can be inferred from the order of September 17, 1932, appealed from, that in
denying the motion for the cancellation of the preliminary attachments filed by the
herein petitioner-appellants on August 5, 1932, the court a quo based its decision
on the ground that a similar motion for the cancellation of the preliminary
attachments in question had already been filed in the said case on July 6, 1931, and
denied by the order of July 31, 1931; and another in civil case No. 39435 of the
Court of First Instance of Manila, entitled "Bank of the Philippine Islands vs. Isidoro
de Santos et al.", which was likewise denied on September 30, 1931. Inasmuch as
the orders denying the aforesaid motions have not been appealed from, they have
therefore become final and conclusive.
43
Property (co-ownership)
The order of the court a quo denying the motions in question is based, therefore,
on the assumption that the question regarding the cancellation of the preliminary
attachment sought by the petitioner-appellants has become res judicata. This court
has constantly held that in order that res judicata may exist, it is necessary that
there be identity of parties, of grounds or causes of action and of things or subject
matter under litigation (Aquino vs. Director of Lands, 39 Phil., 850; Isaac vs. Padilla,
31 Phil., 496; Donato vs. Mendoza, 25 Phil., 57; Roman Catholic Archbishop of
Manila vs. Director of Lands, 35 Phil., 339).
The motion for cancellation dated July 6, 1931, was filed by Felipe de Santos alone,
and the fact that the herein petitioner-appellants were notified thereof has not
made them parties to the said motion, inasmuch as they were not included in the
motion in question in accordance with section 114 of the Code of Civil Procedure.
Neither were the herein petitioner-appellants made parties to the motion for
cancellation of the preliminary attachment filed by Felipe de Santos in civil case No.
39435 of the Court of First Instance of Manila, on August 5, 1931, wherein the Bank
of the Philippine Islands was plaintiff and Isidoro de Santos et al. were defendants.
In the motion under consideration, the denial of which is the subject matter of this
appeal, Felipe de Santos is not a party-petitioner. Therefore, there is no identity
between the petitioner in the motions of July 6, and of August 5, 1931, respectively,
and the parties to the motion under consideration.
In the two motions of July 6, and August 5, 1931, mentioned above, wherein Felipe
de Santos alone was the petitioner, the subject matter thereof could not be other
that the properties adjudicated to him by virtue of the deed of partition, which
properties he wished to free from the attachment, inasmuch as he neither acted
nor could act in representation of his coowners for the reason that he was not
authorized to do so. In the motion under consideration, the petitioner-appellants
pray for the cancellation of the annotation of the preliminary attachment on the
back of the new transfer certificates of title issued in their respective names, by
virtue of the order of the court in the cadastral case, on July 31, 1931. If the
properties which Felipe de Santos sought to free from the preliminary attachment
in his motions of July 6, and of August 5, 1931, were those which had been
adjudicated to him by virtue of the partition, and the properties which the herein
petitioner-appellants seek to free from the same attachment in their motion to that
effect are those which corresponded to them by virtue of the aforesaid partition,
which properties are separate and distinct from those adjudicated to Felipe de
Santos, neither is there identity of subject matter under litigation herein. The only
point where there is identity is in the cause or ground of action for cancellation,
which is the same in the aforestated motions of July 6, and of August 5, 1931, as
well as in the motion under consideration, which ground consists in the partition of
the properties owned in common.lawphi1.net
Therefore, there being no identity either of parties, or of subject matter or thing
under litigation, there is no res judicata.
The second question to decide in this appeal, which is raised in the first assignment
of error, is whether or not it is proper to order the cancellation of the preliminary
attachment annotated on the back of the new transfer certificates of title Nos.
39885, 39879 and 39880, issued respectively in the names of the herein petitioner-
appellants for their respective shares in the community property.
Inasmuch as article 403 of the Civil Code authorizes creditors to contest a partition
already made in case of fraud, or when it has been made to the prejudice of existing
rights and interest, and inasmuch as the oppositor-appellee herein, bank of the
Philippine Islands, was not notified of the partition made among the herein
petitioner-appellants and their coowners Felipe de Santos and Isidoro de Santos,
and was not given an opportunity to contest the partition already made, nor the
approval thereof by the cadastral court, the case should be remanded to the court a
quo in order to permit the said oppositor-appellee, Bank of the Philippine Islands, to
file the objection it may deem convenient, in accordance with the provisions of
article 403 of the Civil Code cited above.
In view of the foregoing considerations, we are of the opinion and so hold that
inasmuch as the partition of the properties held under title of common ownership
was made without notifying the creditors thereof, said creditors may contest the
partition in question in case of fraud, or when it has been made to the prejudice of
existing rights or interests.
Wherefore, the order appealed from is hereby reversed and the case ordered
remanded to the court a quo in order to give the herein oppositor-appellee, Bank of
the Philippine Islands, and opportunity to contest the partition in accordance with
the provisions of article 403 of the Civil Code, without special pronouncement as to
costs. So ordered.
44
Property (co-ownership)
12.) [G.R. No. 1111. May 16, 1903. ]
FELICIDAD GARCIA DE LARA, Plaintiff-Appellant, v. JOSE GONZALEZ DE LARA, ET
AL., Defendants-Appellees.
Emilio Martinez Llanos for Appellant.
No appearance for Appellees.
SYLLABUS
1. CIVIL PROCEDURE; EXCEPTIONS. The nature of exceptions, making thereof,
and preparation of bills of exceptions explained.
2. PARTITION; NECESSARY PARTIES. A bill will not lie for the partition of an
undivided interest in land without the joinder of coowners.
DECISION
COOPER, J. :
This is an appeal by the plaintiff from a judgment of the Court of First Instance,
brought here by bill of exceptions which purports to have been prepared under
section 143 of the Code of Civil Procedure of 1901, but which in reality bears a very
small resemblance to a bill of exceptions properly prepared under the Code. It
contains arguments of counsel, unintelligible statements, and sets forth much that
is irrelevant. The real nature of the suit, the rulings of the court from which the
appeal has been taken, and the character of the judgment rendered, after a careful
reading of the bill of exceptions, are left in doubt and largely to conjecture.
The Code of Civil Procedure is based upon American practice and has superseded
the Spanish Code of Procedure, and since the practice now in force is in a large
measure different from that under the Spanish practice, many difficulties present
themselves to those not familiar with the American practice.
As a general rule, exceptions which are not presented in the course of the
proceedings in the Court of First Instance can not be presented and urged on
appeal to this court. The purpose of the rule is to require a party desiring to review
in the appellate court the action of the trial court to call the attention of the trial
court by timely objections to the proceedings complained of. This rule serves the
interest of litigants and conduces to produce the orderly administration of justice in
the courts.
An exception has been defined as an objection taken to the decision of the trial
court upon a matter of law, and is a notice that the party taking it preserves for the
consideration of the appellate court a ruling deemed erroneous. (8 Am. Enc. P. and
P., 157.)
An objection alone is not sufficient to preserve the question for review on appeal.
To save the objection an exception is necessary.
We will indicate briefly when and how objections are made and exceptions taken.
This will depend upon the character of the question.
They are taken sometimes by demurrer, sometimes by answer, or by some
objection raised during the progress of the trial, or by objections to the judgment
after its rendition. The defendant may demur to the complaint when it appears
upon the face thereof, either
1. That the court has no jurisdiction of the person of the defendant, or the subject
of the action; or
2. That the plaintiff has no legal capacity to sue; or
3. That there is another action pending between the same parties for the same
cause; or
4. That there is a defect or misjoinder of parties, plaintiff or defendant; or
5. That the complaint does not state facts sufficient to constitute a cause of action;
or
6. That the complaint is ambiguous, unintelligible, or uncertain.
The demurrer must distinctly specify the grounds upon which any of the objections
to the complaint are taken.
(Sec. 91, Code of Civil Procedure.)
When any of the matters enumerated in this section do not appear upon the face of
the complaint, the objection to the complaint can only be taken by answer. (Sec.
92.)
If no objection be taken to the complaint, either by demurrer or answer, the
defendant shall be deemed to have waived all the above-named objections,
excepting only the objection to the jurisdiction of the court over the subject-matter,
and that the complaint does not state facts sufficient to constitute a cause of
action. (Sec. 93, Code of Civil Procedure.)
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Property (co-ownership)
If the ruling of the court upon a demurrer be adverse to the party making the same,
he should except to the ruling of the court, and, in order that the court may
determine the force of the objection, it will be necessary to incorporate in the bill of
exceptions the complaint demurred to, the demurrer, and the judgment or ruling of
the court upon the demurrer.
If the objection is raised by the answer, the exception must necessarily come after
the proofs which are made in support of it. The sufficiency and the validity of the
objection thus raised must he determined by the sufficiency of the evidence which
has been offered in support of the allegation contained in the answer. This requires
a review or retrial of the questions of fact and can only be made in the cases which
are provided for in section of the Code of Civil Procedure.
The manner of making objections and taking exceptions to rulings, such as rulings
upon admissibility or exclusion of evidence and other questions arising during the
course of the trial, is provided for in section 142, which reads as
follows:jgc:chanrobles.com.ph
"The party excepting to the ruling, order, or judgment shall forthwith inform the
court that he excepts to the ruling, order, or judgment, and the judge shall
thereupon minute the fact that the party has so excepted; but the trial shall not be
delayed thereby. The exception shall also be recorded by the stenographer, if one is
officially connected with the court."cralaw virtua1aw library
The Code has not made any specific provisions as to the manner and time of taking
exceptions to the final judgment which has been rendered in a case. It would seem
that the objection should be taken at the time of the rendition of the final
judgment, or as soon thereafter as may he practicable, and before the ending of the
term of court at which the final judgment is rendered.
With reference to the character of objections which may be taken to a judgment of
the court, the American rule is stated as follows:jgc:chanrobles.com.ph
"Errors in a judgment or-decree will not be noticed on appeal in the absence of
objections and exceptions taken below, and they should he sufficiently specific to
direct the attention of the court to the alleged defects." (8 Enc. Pr. and Pr., 289.)
If objection to the judgment arises upon the insufficiency of the proof to support
the judgment or the findings of fact made by the judge, it will also be necessary to
bring the case within the first or third clause of section 497 of the Code of Civil
Procedure, and if under the latter clause, the excepting party should file a motion in
the Court of First Instance for a new trial based upon the ground that the findings of
fact are plainly and manifestly against the weight of evidence.
The manner of perfecting a bill of exceptions is governed by section 113 of the Code
and need not be here repeated.
In preparing and presenting a bill of exceptions under this section it is necessary
that counsel should carefully read and follow the plain directions of the statute.
These directions are sufficiently explicit to enable those who carefully consider the
section to comply with them.
In preparing a case for this court, counsel should also carefully consider the rules of
the Supreme Court for sending up the bill of exceptions and for the making of briefs
and assignments of errors.
By reason of the failure of the appellants in this case to comply with the plain
statutory provisions with reference to bills of exceptions, it is largely a matter of
conjecture to determine the nature of the suit, the rulings of the court complained
of, or the character of the judgment which has been rendered. For this failure we
might well refuse to consider the case.
It seems probable that the suit was an action for the partition of a tract of land,
being the undivided half of the hacienda de Angono, situated in the Province of
Rizal, and which the plaintiff and defendants in the suit had inherited from their
deceased father, Don Eugenio Gonzales de Lara; that Eugenio Gonzales de Lara had
acquired this undivided half interest by purchase from Doa Dominga Santa Ana;
that the court refused to partition the Land because the tract sought to be
partitioned was itself an undivided interest, the other half being owned by parties
the names of whom are not disclosed in the record; that the court declined to make
the partition on the ground that the demarcation and boundaries of the land sought
to be partitioned had not been set forth in the partition, and by reason of the
interest which is sought to be partitioned being an undivided interest.
If this was the character of the suit, the Court of First Instance did not err in so
holding.
46
Property (co-ownership)
Partition proceedings are now governed, and were at the time of the institution of
this suit, by the Code of Civil Procedure, 1901, and must be determined by the
provisions of this Code. Section 183 requires that the complaint in an action for
partition shall set forth the nature and extent of the plaintiffs title, and shall
contain an adequate description of the real estate of which partition is demanded,
and name each tenant in common, coparcener, or other person interested therein
as defendants.
This provision requires that all persons interested in the land sought to be
partitioned must be made a party to the suit. If the land sought to be partitioned
was an undivided interest held by the father of the plaintiffs and defendants, in
order to comply with the requirements of the statute those who were interested in
the other half interest should have been made parties to the suit.
This is not only according to the requirements of the Code, but the very nature of a
partition suit renders it necessary; otherwise the proceedings in the suit may
become wholly ineffectual.
This proceeds from the general principle of law that a litigation can never result in
all adjudication which will be binding upon others than the parties to the suit and
their privies in blood or in estate. The other owners were persons who not only had
an interest in the controversy but an interest of such a nature that a final decree
could not be made without affecting that interest. The decree, therefore, could not
bind such parties, and upon another suit for partition brought by them the very half
that had been partitioned in this case might be assigned as the portion belonging to
such other joint owners.
The Code provides that if, upon trial in a partition suit, the court finds that the
plaintiff has a legal right to any part of such estate, it shall order partition thereof in
favor of the plaintiff, among all parties in interest, and if the parties to the suit are
not able to agree amongst themselves to the making of partition, the court shall
appoint three commissioners to make the partition and set off to the plaintiff and
each party in interest such part and proportion of the estate as the court shall
order.
When it is made to appear to the commissioners that the estate, or a portion
thereof, can not be divided without great inconvenience to the parties interested,
the court may order it assigned to one of the parties, provided he pays to the other
party such sum of money as the commissioners judge equitable. But if no one of the
parties interested will take such assignment and pay such sum, the court shall order
the commissioners to sell such estate at public or private sale. Where the estate can
not be divided, the court may direct the sale of the property at public or private
sale. At this public or private sale third parties may become the purchasers.
A suit brought by the persons interested who were not made parties to the suit,
and who are not bound by the partition proceedings, would deprive such purchaser
of the title to the land acquired at public sale under the judgment of a court. Both
the purchaser at such sale and the heirs who had received their specific portion by
metes and bounds, or the heirs who had compensated the other heirs by the
payment of the value of the land, by reason of land not being divisible, could be
deprived of the rights which they had acquired under the proceedings. This could
not only create confusion and inconvenience but the time of the court would have
been uselessly consumed in the proceedings thus rendered ineffectual, at the suit
of the persons who were not made parties to the action. Such result is avoided by
the provision of the statute which requires each tenant in common, coparcener, or
other person interested in the land to be made a party to the suit.
The judgment will be affirmed with costs of both instances against appellants. This
affirmance, however, will be without prejudice to the rights of the plaintiff should
he desire to institute a partition proceeding against all parties at interest and effect
a partition of the lands.
By the provisions of section 181 of the Code of Civil Procedure, a person having or
holding -real estate with others, in any form of joint tenancy or tenancy in common,
may compel partition thereof.
The judgment is affirmed.
47