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G.R. No.

L-17587 September 12, 1967 in Tagalog, imposed on him the obligation to pay for the food of the dogs and the salaries of the maids in
her household, the charge not to exceed P1,800 a month. The option was conditioned on his obtaining
PHILIPPINE BANKING CORPORATION, representing the estate of JUSTINA SANTOS Y Philippine citizenship, a petition for which was then pending in the Court of First Instance of Rizal. It
CANON FAUSTINO, deceased, plaintiff-appellant, appears, however, that this application for naturalization was withdrawn when it was discovered that he
vs. was not a resident of Rizal. On October 28, 1958 she filed a petition to adopt him and his children on the
LUI SHE in her own behalf and as administratrix of the intestate estate of Wong Heng, erroneous belief that adoption would confer on them Philippine citizenship. The error was discovered and
deceased, defendant-appellant. the proceedings were abandoned.

Nicanor S. Sison for plaintiff-appellant. On November 18, 1958 she executed two other contracts, one (Plff Exh. 5) extending the term of the
Ozaeta, Gibbs & Ozaeta for defendant-appellant. `lease to 99 years, and another (Plff Exh. 6) fixing the term of the option of 50 years. Both contracts are
written in Tagalog.

In two wills executed on August 24 and 29, 1959 (Def Exhs. 285 & 279), she bade her legatees to respect
the contracts she had entered into with Wong, but in a codicil (Plff Exh. 17) of a later date (November 4,
1959) she appears to have a change of heart. Claiming that the various contracts were made by her
CASTRO, J.:
because of machinations and inducements practiced by him, she now directed her executor to secure the
annulment of the contracts.
Justina Santos y Canon Faustino and her sister Lorenzo were the owners in common of a piece of land in
Manila. This parcel, with an area of 2,582.30 square meters, is located on Rizal Avenue and opens into
On November 18 the present action was filed in the Court of First Instance of Manila. The complaint
Florentino Torres street at the back and Katubusan street on one side. In it are two residential houses with
alleged that the contracts were obtained by Wong "through fraud, misrepresentation, inequitable conduct,
entrance on Florentino Torres street and the Hen Wah Restaurant with entrance on Rizal Avenue. The
undue influence and abuse of confidence and trust of and (by) taking advantage of the helplessness of the
sisters lived in one of the houses, while Wong Heng, a Chinese, lived with his family in the restaurant.
plaintiff and were made to circumvent the constitutional provision prohibiting aliens from acquiring
Wong had been a long-time lessee of a portion of the property, paying a monthly rental of P2,620.
lands in the Philippines and also of the Philippine Naturalization Laws." The court was asked to direct
the Register of Deeds of Manila to cancel the registration of the contracts and to order Wong to pay
On September 22, 1957 Justina Santos became the owner of the entire property as her sister died with no Justina Santos the additional rent of P3,120 a month from November 15, 1957 on the allegation that the
other heir. Then already well advanced in years, being at the time 90 years old, blind, crippled and an reasonable rental of the leased premises was P6,240 a month.
invalid, she was left with no other relative to live with. Her only companions in the house were her 17
dogs and 8 maids. Her otherwise dreary existence was brightened now and then by the visits of Wong's
four children who had become the joy of her life. Wong himself was the trusted man to whom she In his answer, Wong admitted that he enjoyed her trust and confidence as proof of which he volunteered
the information that, in addition to the sum of P3,000 which he said she had delivered to him for
delivered various amounts for safekeeping, including rentals from her property at the corner of Ongpin
safekeeping, another sum of P22,000 had been deposited in a joint account which he had with one of her
and Salazar streets and the rentals which Wong himself paid as lessee of a part of the Rizal Avenue
maids. But he denied having taken advantage of her trust in order to secure the execution of the contracts
property. Wong also took care of the payment; in her behalf, of taxes, lawyers' fees, funeral expenses,
in question. As counterclaim he sought the recovery of P9,210.49 which he said she owed him for
masses, salaries of maids and security guard, and her household expenses.
advances.
"In grateful acknowledgment of the personal services of the lessee to her," Justina Santos executed on
Wong's admission of the receipt of P22,000 and P3,000 was the cue for the filing of an amended
November 15, 1957 a contract of lease (Plff Exh. 3) in favor of Wong, covering the portion then already
complaint. Thus on June 9, 1960, aside from the nullity of the contracts, the collection of various
leased to him and another portion fronting Florentino Torres street. The lease was for 50 years, although
amounts allegedly delivered on different occasions was sought. These amounts and the dates of their
the lessee was given the right to withdraw at any time from the agreement; the monthly rental was
P3,120. The contract covered an area of 1,124 square meters. Ten days later (November 25), the contract delivery are P33,724.27 (Nov. 4, 1957); P7,344.42 (Dec. 1, 1957); P10,000 (Dec. 6, 1957); P22,000 and
was amended (Plff Exh. 4) so as to make it cover the entire property, including the portion on which the P3,000 (as admitted in his answer). An accounting of the rentals from the Ongpin and Rizal Avenue
properties was also demanded.
house of Justina Santos stood, at an additional monthly rental of P360. For his part Wong undertook to
pay, out of the rental due from him, an amount not exceeding P1,000 a month for the food of her dogs
and the salaries of her maids. In the meantime as a result of a petition for guardianship filed in the Juvenile and Domestic Relations
Court, the Security Bank & Trust Co. was appointed guardian of the properties of Justina Santos, while
On December 21 she executed another contract (Plff Exh. 7) giving Wong the option to buy the leased Ephraim G. Gochangco was appointed guardian of her person.
premises for P120,000, payable within ten years at a monthly installment of P1,000. The option, written
In his answer, Wong insisted that the various contracts were freely and voluntarily entered into by the And so it was held in Melencio v. Dy Tiao Lay 3 that a "provision in a lease contract that the lessee, at
parties. He likewise disclaimed knowledge of the sum of P33,724.27, admitted receipt of P7,344.42 and any time before he erected any building on the land, might rescind the lease, can hardly be regarded as a
P10,000, but contended that these amounts had been spent in accordance with the instructions of Justina violation of article 1256 [now art. 1308] of the Civil Code."
Santos; he expressed readiness to comply with any order that the court might make with respect to the
sums of P22,000 in the bank and P3,000 in his possession. The case of Singson Encarnacion v. Baldomar 4 cannot be cited in support of the claim of want of
mutuality, because of a difference in factual setting. In that case, the lessees argued that they could
The case was heard, after which the lower court rendered judgment as follows: occupy the premises as long as they paid the rent. This is of course untenable, for as this Court said, "If
this defense were to be allowed, so long as defendants elected to continue the lease by continuing the
[A]ll the documents mentioned in the first cause of action, with the exception of the first which payment of the rentals, the owner would never be able to discontinue it; conversely, although the owner
is the lease contract of 15 November 1957, are declared null and void; Wong Heng is should desire the lease to continue the lessees could effectively thwart his purpose if they should prefer to
condemned to pay unto plaintiff thru guardian of her property the sum of P55,554.25 with legal terminate the contract by the simple expedient of stopping payment of the rentals." Here, in contrast, the
interest from the date of the filing of the amended complaint; he is also ordered to pay the sum right of the lessee to continue the lease or to terminate it is so circumscribed by the term of the contract
of P3,120.00 for every month of his occupation as lessee under the document of lease herein that it cannot be said that the continuance of the lease depends upon his will. At any rate, even if no term
sustained, from 15 November 1959, and the moneys he has consigned since then shall be had been fixed in the agreement, this case would at most justify the fixing of a period5 but not the
imputed to that; costs against Wong Heng. annulment of the contract.

From this judgment both parties appealed directly to this Court. After the case was submitted for Nor is there merit in the claim that as the portion of the property formerly owned by the sister of Justina
decision, both parties died, Wong Heng on October 21, 1962 and Justina Santos on December 28, 1964. Santos was still in the process of settlement in the probate court at the time it was leased, the lease is
Wong was substituted by his wife, Lui She, the other defendant in this case, while Justina Santos was invalid as to such portion. Justina Santos became the owner of the entire property upon the death of her
substituted by the Philippine Banking Corporation. sister Lorenzo on September 22, 1957 by force of article 777 of the Civil Code. Hence, when she leased
the property on November 15, she did so already as owner thereof. As this Court explained in upholding
the sale made by an heir of a property under judicial administration:
Justina Santos maintained — now reiterated by the Philippine Banking Corporation — that the lease
contract (Plff Exh. 3) should have been annulled along with the four other contracts (Plff Exhs. 4-7)
because it lacks mutuality; because it included a portion which, at the time, was in custodia legis; That the land could not ordinarily be levied upon while in custodia legis does not mean that one
because the contract was obtained in violation of the fiduciary relations of the parties; because her of the heirs may not sell the right, interest or participation which he has or might have in the
consent was obtained through undue influence, fraud and misrepresentation; and because the lease lands under administration. The ordinary execution of property in custodia legis is prohibited in
contract, like the rest of the contracts, is absolutely simulated. order to avoid interference with the possession by the court. But the sale made by an heir of his
share in an inheritance, subject to the result of the pending administration, in no wise stands in
Paragraph 5 of the lease contract states that "The lessee may at any time withdraw from this agreement." the way of such administration.6
It is claimed that this stipulation offends article 1308 of the Civil Code which provides that "the contract
must bind both contracting parties; its validity or compliance cannot be left to the will of one of them." It is next contended that the lease contract was obtained by Wong in violation of his fiduciary
relationship with Justina Santos, contrary to article 1646, in relation to article 1941 of the Civil Code,
We have had occasion to delineate the scope and application of article 1308 in the early case of Taylor v. which disqualifies "agents (from leasing) the property whose administration or sale may have been
Uy Tieng Piao.1 We said in that case: entrusted to them." But Wong was never an agent of Justina Santos. The relationship of the parties,
although admittedly close and confidential, did not amount to an agency so as to bring the case within the
prohibition of the law.
Article 1256 [now art. 1308] of the Civil Code in our opinion creates no impediment to the
insertion in a contract for personal service of a resolutory condition permitting the cancellation
of the contract by one of the parties. Such a stipulation, as can be readily seen, does not make Just the same, it is argued that Wong so completely dominated her life and affairs that the contracts
either the validity or the fulfillment of the contract dependent upon the will of the party to whom express not her will but only his. Counsel for Justina Santos cites the testimony of Atty. Tomas S. Yumol
who said that he prepared the lease contract on the basis of data given to him by Wong and that she told
is conceded the privilege of cancellation; for where the contracting parties have agreed that such
him that "whatever Mr. Wong wants must be followed."7
option shall exist, the exercise of the option is as much in the fulfillment of the contract as any
other act which may have been the subject of agreement. Indeed, the cancellation of a contract
in accordance with conditions agreed upon beforehand is fulfillment. 2 The testimony of Atty. Yumol cannot be read out of context in order to warrant a finding that Wong
practically dictated the terms of the contract. What this witness said was:
Q Did you explain carefully to your client, Doña Justina, the contents of this document before have testified on the undue influence that Wong supposedly wielded over Justina Santos, but neither of
she signed it? them was presented as a witness. The truth is that even after giving his client time to think the matter
over, the lawyer could not make her change her mind. This persuaded the lower court to uphold the
A I explained to her each and every one of these conditions and I also told her these conditions validity of the lease contract against the claim that it was procured through undue influence.
were quite onerous for her, I don't really know if I have expressed my opinion, but I told her that
we would rather not execute any contract anymore, but to hold it as it was before, on a verbal Indeed, the charge of undue influence in this case rests on a mere inference 12 drawn from the fact that
month to month contract of lease. Justina Santos could not read (as she was blind) and did not understand the English language in which
the contract is written, but that inference has been overcome by her own evidence.
Q But, she did not follow your advice, and she went with the contract just the same?
Nor is there merit in the claim that her consent to the lease contract, as well as to the rest of the contracts
A She agreed first . . . in question, was given out of a mistaken sense of gratitude to Wong who, she was made to believe, had
saved her and her sister from a fire that destroyed their house during the liberation of Manila. For while a
Q Agreed what? witness claimed that the sisters were saved by other persons (the brothers Edilberto and Mariano Sta.
Ana)13 it was Justina Santos herself who, according to her own witness, Benjamin C. Alonzo, said "very
emphatically" that she and her sister would have perished in the fire had it not been for Wong. 14 Hence
A Agreed with my objectives that it is really onerous and that I was really right, but after that, I the recital in the deed of conditional option (Plff Exh. 7) that "[I]tong si Wong Heng ang siyang nagligtas
was called again by her and she told me to follow the wishes of Mr. Wong Heng. sa aming dalawang magkapatid sa halos ay tiyak na kamatayan", and the equally emphatic avowal of
gratitude in the lease contract (Plff Exh. 3).
xxx xxx xxx
As it was with the lease contract (Plff Exh. 3), so it was with the rest of the contracts (Plff Exhs. 4-7) —
Q So, as far as consent is concerned, you were satisfied that this document was perfectly the consent of Justina Santos was given freely and voluntarily. As Atty. Alonzo, testifying for her, said:
proper?
[I]n nearly all documents, it was either Mr. Wong Heng or Judge Torres and/or both. When we
xxx xxx xxx had conferences, they used to tell me what the documents should contain. But, as I said, I would
always ask the old woman about them and invariably the old woman used to tell me: "That's
A Your Honor, if I have to express my personal opinion, I would say she is not, because, as I okay. It's all right."15
said before, she told me — "Whatever Mr. Wong wants must be followed."8
But the lower court set aside all the contracts, with the exception of the lease contract of November 15,
Wong might indeed have supplied the data which Atty. Yumol embodied in the lease contract, but to say 1957, on the ground that they are contrary to the expressed wish of Justina Santos and that their
this is not to detract from the binding force of the contract. For the contract was fully explained to Justina considerations are fictitious. Wong stated in his deposition that he did not pay P360 a month for the
Santos by her own lawyer. One incident, related by the same witness, makes clear that she voluntarily additional premises leased to him, because she did not want him to, but the trial court did not believe
consented to the lease contract. This witness said that the original term fixed for the lease was 99 years him. Neither did it believe his statement that he paid P1,000 as consideration for each of the contracts
but that as he doubted the validity of a lease to an alien for that length of time, he tried to persuade her to (namely, the option to buy the leased premises, the extension of the lease to 99 years, and the fixing of
enter instead into a lease on a month-to-month basis. She was, however, firm and unyielding. Instead of the term of the option at 50 years), but that the amount was returned to him by her for safekeeping.
heeding the advice of the lawyer, she ordered him, "Just follow Mr. Wong Heng." 9 Recounting the Instead, the court relied on the testimony of Atty. Alonzo in reaching the conclusion that the contracts are
incident, Atty. Yumol declared on cross examination: void for want of consideration.

Considering her age, ninety (90) years old at the time and her condition, she is a wealthy Atty. Alonzo declared that he saw no money paid at the time of the execution of the documents, but his
woman, it is just natural when she said "This is what I want and this will be done." In particular negative testimony does not rule out the possibility that the considerations were paid at some other time
reference to this contract of lease, when I said "This is not proper," she said — "You just go as the contracts in fact recite. What is more, the consideration need not pass from one party to the other at
ahead, you prepare that, I am the owner, and if there is any illegality, I am the only one that can the time a contract is executed because the promise of one is the consideration for the other. 16
question the illegality."10
With respect to the lower court's finding that in all probability Justina Santos could not have intended to
Atty. Yumol further testified that she signed the lease contract in the presence of her close friend, part with her property while she was alive nor even to lease it in its entirety as her house was built on it,
Hermenegilda Lao, and her maid, Natividad Luna, who was constantly by her side. 11 Any of them could
suffice it to quote the testimony of her own witness and lawyer who prepared the contracts (Plff Exhs. 4- It does not follow from what has been said, however, that because the parties are in pari delicto they will
7) in question, Atty. Alonzo: be left where they are, without relief. For one thing, the original parties who were guilty of a violation of
the fundamental charter have died and have since been substituted by their administrators to whom it
The ambition of the old woman, before her death, according to her revelation to me, was to see would be unjust to impute their guilt.23 For another thing, and this is not only cogent but also important,
to it that these properties be enjoyed, even to own them, by Wong Heng because Doña Justina article 1416 of the Civil Code provides, as an exception to the rule on pari delicto, that "When the
told me that she did not have any relatives, near or far, and she considered Wong Heng as a son agreement is not illegal per se but is merely prohibited, and the prohibition by law is designed for the
and his children her grandchildren; especially her consolation in life was when she would hear protection of the plaintiff, he may, if public policy is thereby enhanced, recover what he has paid or
the children reciting prayers in Tagalog.17 delivered." The Constitutional provision that "Save in cases of hereditary succession, no private
agricultural land shall be transferred or assigned except to individuals, corporations, or associations
qualified to acquire or hold lands of the public domain in the Philippines" 24 is an expression of public
She was very emphatic in the care of the seventeen (17) dogs and of the maids who helped her
policy to conserve lands for the Filipinos. As this Court said in Krivenko:
much, and she told me to see to it that no one could disturb Wong Heng from those properties.
That is why we thought of the ninety-nine (99) years lease; we thought of adoption, believing
that thru adoption Wong Heng might acquire Filipino citizenship; being the adopted child of a It is well to note at this juncture that in the present case we have no choice. We are construing
Filipino citizen.18 the Constitution as it is and not as we may desire it to be. Perhaps the effect of our construction
is to preclude aliens admitted freely into the Philippines from owning sites where they may
build their homes. But if this is the solemn mandate of the Constitution, we will not attempt to
This is not to say, however, that the contracts (Plff Exhs. 3-7) are valid. For the testimony just quoted,
compromise it even in the name of amity or equity . . . .
while dispelling doubt as to the intention of Justina Santos, at the same time gives the clue to what we
view as a scheme to circumvent the Constitutional prohibition against the transfer of lands to aliens. "The
illicit purpose then becomes the illegal causa"19 rendering the contracts void. For all the foregoing, we hold that under the Constitution aliens may not acquire private or
public agricultural lands, including residential lands, and, accordingly, judgment is affirmed,
without costs.25
Taken singly, the contracts show nothing that is necessarily illegal, but considered collectively, they
reveal an insidious pattern to subvert by indirection what the Constitution directly prohibits. To be sure, a
lease to an alien for a reasonable period is valid. So is an option giving an alien the right to buy real That policy would be defeated and its continued violation sanctioned if, instead of setting the contracts
property on condition that he is granted Philippine citizenship. As this Court said in Krivenko v. Register aside and ordering the restoration of the land to the estate of the deceased Justina Santos, this Court
of Deeds:20 should apply the general rule of pari delicto. To the extent that our ruling in this case conflicts with that
laid down in Rellosa v. Gaw Chee Hun 26 and subsequent similar cases, the latter must be considered
as pro tanto qualified.
[A]liens are not completely excluded by the Constitution from the use of lands for residential
purposes. Since their residence in the Philippines is temporary, they may be granted temporary
rights such as a lease contract which is not forbidden by the Constitution. Should they desire to The claim for increased rentals and attorney's fees, made in behalf of Justina Santos, must be denied for
remain here forever and share our fortunes and misfortunes, Filipino citizenship is not lack of merit.
impossible to acquire.
And what of the various amounts which Wong received in trust from her? It appears that he kept two
But if an alien is given not only a lease of, but also an option to buy, a piece of land, by virtue of which classes of accounts, one pertaining to amount which she entrusted to him from time to time, and another
the Filipino owner cannot sell or otherwise dispose of his property,21 this to last for 50 years, then it pertaining to rentals from the Ongpin property and from the Rizal Avenue property, which he himself
becomes clear that the arrangement is a virtual transfer of ownership whereby the owner divests himself was leasing.
in stages not only of the right to enjoy the land ( jus possidendi, jus utendi, jus fruendi and jus abutendi)
but also of the right to dispose of it ( jus disponendi) — rights the sum total of which make up ownership. With respect to the first account, the evidence shows that he received P33,724.27 on November 8, 1957
It is just as if today the possession is transferred, tomorrow, the use, the next day, the disposition, and so (Plff Exh. 16); P7,354.42 on December 1, 1957 (Plff Exh. 13); P10,000 on December 6, 1957 (Plff Exh.
on, until ultimately all the rights of which ownership is made up are consolidated in an alien. And yet this 14) ; and P18,928.50 on August 26, 1959 (Def. Exh. 246), or a total of P70,007.19. He claims, however,
is just exactly what the parties in this case did within the space of one year, with the result that Justina that he settled his accounts and that the last amount of P18,928.50 was in fact payment to him of what in
Santos' ownership of her property was reduced to a hollow concept. If this can be done, then the the liquidation was found to be due to him.
Constitutional ban against alien landholding in the Philippines, as announced in Krivenko v. Register of
Deeds,22 is indeed in grave peril. He made disbursements from this account to discharge Justina Santos' obligations for taxes, attorneys'
fees, funeral services and security guard services, but the checks (Def Exhs. 247-278) drawn by him for
this purpose amount to only P38,442.84.27 Besides, if he had really settled his accounts with her on
August 26, 1959, we cannot understand why he still had P22,000 in the bank and P3,000 in his payment of rental from November 15, 1959 until the premises shall have been vacated by his heirs. Costs
possession, or a total of P25,000. In his answer, he offered to pay this amount if the court so directed against the defendant-appellant.
him. On these two grounds, therefore, his claim of liquidation and settlement of accounts must be
rejected. MANUEL LUIS SANCHEZ G.R. No. 148516
Petitioner,
After subtracting P38,442.84 (expenditures) from P70,007.19 (receipts), there is a difference of P31,564
which, added to the amount of P25,000, leaves a balance of P56,564.35 28 in favor of Justina Santos. Present:

As to the second account, the evidence shows that the monthly income from the Ongpin property until its YNARES-SANTIAGO, J.,
sale in Rizal Avenue July, 1959 was P1,000, and that from the Rizal Avenue property, of which Wong Chairperson,
was the lessee, was P3,120. Against this account the household expenses and disbursements for the care - versus - AUSTRIA-MARTINEZ,
of the 17 dogs and the salaries of the 8 maids of Justina Santos were charged. This account is contained CHICO-NAZARIO,
in a notebook (Def. Exh. 6) which shows a balance of P9,210.49 in favor of Wong. But it is claimed that NACHURA, and
the rental from both the Ongpin and Rizal Avenue properties was more than enough to pay for her REYES, JJ.
monthly expenses and that, as a matter of fact, there should be a balance in her favor. The lower court did
not allow either party to recover against the other. Said the court:
Promulgated:
[T]he documents bear the earmarks of genuineness; the trouble is that they were made only by MAPALAD REALTY CORPORATION,
Francisco Wong and Antonia Matias, nick-named Toning, — which was the way she signed the Respondent. December 27, 2007
loose sheets, and there is no clear proof that Doña Justina had authorized these two to act for her
in such liquidation; on the contrary if the result of that was a deficit as alleged and sought to be x--------------------------------------------------x
there shown, of P9,210.49, that was not what Doña Justina apparently understood for as the
Court understands her statement to the Honorable Judge of the Juvenile Court . . . the reason DECISION
why she preferred to stay in her home was because there she did not incur in any debts . . . this
being the case, . . . the Court will not adjudicate in favor of Wong Heng on his counterclaim; on REYES, J.:
the other hand, while it is claimed that the expenses were much less than the rentals and there in
fact should be a superavit, . . . this Court must concede that daily expenses are not easy to
compute, for this reason, the Court faced with the choice of the two alternatives will choose the
middle course which after all is permitted by the rules of proof, Sec. 69, Rule 123 for in the KAPAG ang isang kasunduan ng bilihan ay
ordinary course of things, a person will live within his income so that the conclusion of the
Court will be that there is neither deficit nor superavit and will let the matter rest here. may kaakibat na pandaraya at napatunayang huwad, ang bumili ay walang nakamit na titulo ng pag-
aari. Ang bentahan ng apat na parsela ngmamahaling lupa sa Roxas Boulevard na isinuko ng dating
Both parties on appeal reiterate their respective claims but we agree with the lower court that both claims
should be denied. Aside from the reasons given by the court, we think that the claim of Justina Santos kasamahan ng Pangulong Marcos sa pamahalaang Aquino ay nagtataglay ng mga palatandaan ng is
totalling P37,235, as rentals due to her after deducting various expenses, should be rejected as the ang malakihang pandaraya na isinagawamismo ng mga taong hinirang ng Presidential Commission
evidence is none too clear about the amounts spent by Wong for food 29 masses30 and salaries of her
maids.31 His claim for P9,210.49 must likewise be rejected as his averment of liquidation is belied by his on Good Government (PCGG) upang pangalagaan ang pag-aari ng isang na-sequester na kumpanya.
own admission that even as late as 1960 he still had P22,000 in the bank and P3,000 in his possession.

ACCORDINGLY, the contracts in question (Plff Exhs. 3-7) are annulled and set aside; the land subject- Ang mga ito ay dapat ibalik sa pamahalaan hanggang di pa tiyak ang tunay na may-
matter of the contracts is ordered returned to the estate of Justina Santos as represented by the Philippine ari. Hindi kanais-nais na nagpakahirap ang PCGG sa pagbawi ng nasabing pag-
Banking Corporation; Wong Heng (as substituted by the defendant-appellant Lui She) is ordered to pay
the Philippine Banking Corporation the sum of P56,564.35, with legal interest from the date of the filing aari para lamang mawala itodahil sa manipulasyon ng isang di mapagkakatiwalaang opisyal.
of the amended complaint; and the amounts consigned in court by Wong Heng shall be applied to the
Where a deed of sale was attended by fraud and proved to be fictitious, the buyer acquired no title On March 23, 1986, the PCGG issued writs of sequestration for Mapalad and all its properties.[7]
to the subject property. The sale of four parcels of prime land along Roxas Boulevard surrendered by a
former associate of President Marcos to the Aquino government bears the earmarks of a grand scam On August 2, 1992, the PCGG appointed Rolando E. Josef as Vice President/Treasurer and
perpetrated by the very same persons appointed by the Presidential Commission on Good Government General Manager of Mapalad. He immediately conducted an inventory of the assets of the
(PCGG) to safeguard the assets of the sequestered companies. [1] corporation. This was when it was discovered that four (4) TCTs were missing, namely, TCT Nos. S-
81403, S-81404, S-81405, and S-81406.
They must be restored to the custody of the government until their true owner is finally
determined. It would be odious to have the PCGG work so hard to recover them only to have them lost due Josef inquired on the whereabouts of these missing TCTs from Luis R. Narciso, an employee of
to manipulation of an unscrupulous official. Port Center Development Corporation, a sister company of Mapalad. Josef was informed that Mapalads
former director and general manager, Felicito L. Manalili (GM Manalili) took the said missing TCTs
This petition for review on certiorari seeks a reversal of the Decision[2] of the Court of Appeals (CA) which sometime in July 1992.
reversed and set aside that[3] of the Regional Trial Court (RTC), Branch 135, Makati City in an action for
annulment of deed of sale and reconveyance[4] filed by respondent Mapalad Realty Corporation (Mapalad, On September 8, 1992, Narciso executed an affidavit[8] stating that the missing TCTs were taken
for brevity). from him by GM Manalili.
Petitioner Manuel Luis Sanchez, who bought the properties during the pendency of the case at the trial Josef personally talked to GM Manalili to inquire about what happened to the titles he took from
court, intervened in the appeal before the CA. Narciso. GM Manalili promised to return the titles as soon as he found them. He never did, despite repeated
demands on him.
The Facts
On November 16, 1992, Felimon Oliquiano, Jr., president of Nordelak Development Corporation
The facts, as gleaned from the records, are as follows: (Nordelak, for brevity), filed a notice of adverse claim[9] over the subject properties based on a deed of sale
purportedly executed on November 2, 1989 by Miguel Magsaysay in his capacity as president and board
Respondent Mapalad was the registered owner of four (4) parcels of land located along Roxas Boulevard, chairman of Mapalad, selling the four lots to Nordelak for the total purchase price of P20,190,000.00. This
Baclaran, Paraaque. The properties, covered by Transfer Certificates of Title (TCT) Nos. S-81403, S- deed of sale was notarized by Elpidio T. Clemente as Document No. 121, Page 26, Book No. 82 Series of
81404, S-81405 and S-81406 have a total land area of 4,038 square meters. [5] 1989.[10]

On March 21, 1986, shortly after the February 1986 EDSA Revolution, Jose Y. Campos executed
Josef notified the Register of Deeds (RD) of Paraaque by three successive letters dated November
an affidavit[6] admitting, among others, that Mapalad was one of the companies he held in trust for former
18, December 7 and 8, 1992 that the owners duplicate copies of four (4) TCTs in the name of Mapalad
President Ferdinand E. Marcos. Campos turned over all assets, properties, records and documents
were missing, and requested the RD not to entertain any transaction, particularly any attempt to transfer
pertaining to Mapalad to the new administration led by then President Corazon C. Aquino.
ownership thereof, or annotate any encumbrance or lien of any kind on these four TCTs.
Immediately upon learning of the cancellation of Mapalads four TCTs, Josef conferred with
Since Josefs letters to the RD were not verified, the RD instructed him to submit a verified petition Miguel Magsaysay to find out whether the latter indeed signed the purported deeds of absolute sale both
or cancellation of adverse claim; Josef complied. dated November 2, 1989.

On December 22, 1992, Mapalad filed with the RD a verified petition for cancellation of adverse Magsaysay denied having signed those deeds.
claim annotated on its titles by Nordelak.[11] The petition also included a notice of loss of the owners
duplicate copies of the TCTs concerned. This was annotated on the titles as Entry No. 154431 on the next On January 19, 1993, the PCGG asked the Paraaque RD to immediately recall, revoke and cancel
day. the four (4) titles that were issued in favor of Nordelak. [15]

On January 14, 1993, Mapalad discovered, after verification with the records of the RD, that its On January 22, 1993, the PCGG issued a writ of injunction, enjoining and restraining
titles to the four (4) properties were cancelled as early as December 22, 1992. In lieu of them, TCT Nos. the Paraaque RD from entertaining and processing any document or transaction relative to the titles in the
68493, 68494, 68495, and 68496 in the name of Nordelak were issued [12] by virtue of another deed of sale name of Nordelak. This PCGG injunction was annotated on the titles as Entry No. 93-14786.
also dated November 2, 1989 and purportedly signed by the same Miguel Magsaysay in his capacity as
president and chairman of the board of Mapalad. On January 25, 1993, the RD in turn requested Nordelak to surrender the titles issued in its name,
but Nordelak refused to comply.
Although this document was also notarized by the same Elpidio T. Clemente, bearing the same
Document No. 121, Page 26, Book No. 82, Series of 1989, the amount indicated in this deed of sale as total On February 3, 1993, Mapalad commenced, before the RTC, Makati City, the present action for
purchase price was P7,268,400.00 instead of P20,190,000.00 as earlier annotated in the title per the adverse annulment of deed of sale and reconveyance of title with damages against Nordelak, that is now the subject
claim on November 16, 1992. In other words, there were two deeds of absolute sale, bearing the same of this petition.
dates, involving the same parties, the same parcel of land, and notarized by the same Notary Public under
identical notarial entries, with different considerations or purchase price. Mapalads complaint alleged that: (a) the deed of sale is falsified and a forgery; (b) defendant
Felicito L. Manalili[16] conspired and confederated with the other defendants to defraud Mapalad by
Way back October 13, 1978, A. Magsaysay, Inc., a corporation controlled by Miguel Magsaysay, fabricating a fictitious, spurious and falsified deed of sale; and (c) there is another deed of absolute sale
acquired ownership of all shares of stock of Mapalad.[13] with the same date of November 2, 1989 and also bearing the purported signature of Miguel Magsaysay,
but the two deeds of sale differ in the amounts of consideration, one for P20,190,000.00 and the other
On December 3, 1982, however, A. Magsaysay, Inc. sold all its shares to Novo Properties, for P7,268,400.00, which was used in the transfer of Mapalads titles in favor of Nordelak.
Inc.[14] Miguel Magsaysay also sold his one and only share to Novo Properties, Inc., thus completely
terminating any and all rights or interest he used to have over the properties of Mapalad. Mapalad prayed for judgment: (a) declaring the two (2) deeds of absolute sale null and void; (b)
ordering Nordelak to reconvey the four (4) parcels of land in favor of Mapalad; (c) ordering the Register
of Deeds to cancel TCT Nos. 68493, 68494, 68495, and 68496, and in lieu thereof, to issue replacement
titles in the name of Mapalad; and (d) ordering Nordelak to pay exemplary damages, attorneys fees and On the other hand, judgment is hereby rendered in favor of defendants against
costs of suit. the plaintiff by way of counterclaim, for the latter to pay actual and compensatory
damages in favor of private defendants (excluding public defendant Register of deeds of
On February 22, 1993, a notice of lis pendens was annotated as Entry No. 93-91718 on the TCTs Paraaque herein represented by the Office of the Solicitor General) the sum
in Nordelaks name.[17] of P50,000.00; attorneys fees in the sum of P30,000.00; and the costs of the proceedings.

Furthermore, Entry No. 15431 re a Verified Petition for cancellation of the


On March 4, 1993, the RD, through the Office of the Solicitor General, filed its answer alleging adverse claim annotated at the back of TCT Nos. S-81403, S-81404, S-81405, and S-
81406, (Exhs. O, P, Q, and R) filed by Rolando E. Josef, V/P-General Manager of
that when the requirements of registration are complied with, the duty of the register of deeds becomes Mapalad Realty Corporation inscribed on December 17, 1992 is ordered CANCELLED.
simply ministerial.
SO ORDERED.[19]

On April 26, 1993, Nordelak and its president, Oliquiano filed their answer with special and
affirmative defenses, alleging that Nordelak is a buyer in good faith, and that it never dealt with defendant On December 19, 1994, upon Nordelaks manifestation, the RTC issued a Supplemental Decision
Manalili in the purchase of the subject properties. cancelling the notice of lis pendens annotated as Entry No. 93-91718 at the back of Nordelaks TCTs Nos.
68493, 68494, 68495, and 68496, and also lifting the restraining order issued by the PCGG annotated on
Defendant Manalili, however, failed to file any answer within the reglementary period. the said titles as Entry No. 93-14786.
The RTC declared him in default despite Section 14, Rule 18 of the Rules of Court stating that when a
complaint states a common cause of action against several defendants, some of whom answer, and the On December 29, 1994 and January 2, 1995, Mapalad filed a motion for reconsideration and
others fail to do so, the court shall try the case against all upon the answers thus filed and render judgment supplemental motion for reconsideration, respectively, to which an opposition was filed by Nordelak
upon the evidence presented x x x. on January 13, 1995.

On October 24, 1994, while the case was still pending before the RTC, Nordelak sold the subject On January 2, 1995, the RTC issued an order denying the twin motions for
properties for P50,000,000.00 to a certain Manuel Luis S. Sanchez, now petitioner before Us. reconsideration. Mapalad then seasonably appealed to the CA.

RTC Judgment Having previously bought the properties from Nordelak during the pendency of the case with the
RTC, petitioner Sanchez moved to be joined with Nordelak as party defendant-appellee before the CA.The
On December 6, 1994, ruling that Mapalad failed to adduce positive proof of forgery, CA granted the motion to intervene.
the RTC upheld the validity of the deed of absolute sale as a notarial document and rendered
judgment[18] with the following fallo: CA Disposition

WHEREFORE, premises considered, for failure of plaintiff to establish


Finding merit in the appeal, the CA disposed of it, as follows:
preponderance of evidence to support its herein Complaint, the above-entitled case is
ordered DISMISSED for lack of cause of action and for being without merit.
WHEREFORE, premises considered, the assailed decision is REVERSED
and SET ASIDE and a new one entered ̶ Third. Atty. Elpidio T. Clemente, the Notary Public who notarized the
questioned Deed of Absolute Sale, did not submit a copy of said deed in the Notarial
Section of the Regional Trial Court of Manila.
1. DECLARING as null and void the deed of absolute sale dated 02
November 1989 executed by and between Mapalad Realty Corporation and
xxxx
Nordelak Development Corporation;
x x x. As pointed out by appellant Mapalad in its brief, the notary public
2. DECLARING as null and void the deed of absolute sale dated 24 October
notarized two separate deeds of sale referring to the same parcels of land on the very
1994 executed by and between Nordelak Development Corporation and same day, and made only one and the same entry for the two documents in his notarial
Manuel Luis S. Sanchez; registry. In fact, NOT ONE witness was ever presented by defendants-appellees to
explain these highly anomalous documentations.
3. ORDERING the Register of Deeds of Paraaque to cancel TCT Nos.
68493, 68494, 68495, and 68496 and in lieu thereof, to issue new Fourth. There was no consideration for the deed of sale. On this point, Rolando
certificates of title covering the subject properties in the name of Mapalad Josef testified that appellant Mapalad did not receive any amount with respect to the
Realty Corporation. alleged transaction involving the sale of its properties.This was not disputed by the
appellees. Since the alleged consideration is in the millions of pesos, it can be assumed
Further, appellee Nordelak is ordered to pay appellant P100,000.00 as attorneys that payment was made by check. It was easy enough for appellee Nordelak to have
fees. presented the cancelled check. Its failure to do so speaks volumes of truth of Josefs
testimony. x x x.
SO ORDERED.[20]
Fifth. In the questioned deed of sale, Nordelak was represented by one Felimon
R. Oliquiano, Jr., in his capacity as President of the corporation. Thus, he was in the best
This ruling was arrived at after the CAs re-evaluation of the entire records, finding clear evidence position to testify on the validity of the questioned deed of sale and categorically state
of fraud in obtaining the certificates of title over the disputed properties, to wit: that it was Magsaysay who signed the deed of sale and refute Magsaysays testimony. But
First. Miguel A. Magsaysay was no longer appellant Mapalads President and he was never presented and the failure to present him was never explained. In fact, no
Chairman of the Board when the subject deed of absolute sale was executed on 02 one was presented to testify having negotiated with and concluded the transaction with
November 1989. The evidence shows that by virtue of a Deed of Sale of Shares of Stock Magsaysay or that he personally saw Magsaysay sign the deed of sale. Defendant-
dated 03 December 1982, Miguel Magsaysay ceded and sold his one and only share of appellee Nordelak presented only two witnesses both of whom were not connected
stock in Mapalad Realty Corporation in favor of Novo Properties, Inc. x x x. And in his Nordelak and, in fact, did not know Mapalad.
testimony, Miguel Magsaysay denied having affixed his signature on the questioned
deed of sale and categorically stated that he ceased to be connected with appellant xxxx
Mapalad after the sale of his share in 1982.
We therefore find that the execution of the deed of absolute sale was attended
xxxx by fraud, hence, a nullity. Thus, appellee Nordelak never acquired title over the subject
properties. And given the evidence on record, We are left to wonder in no small measure
Second. The Deed of Absolute Sale indicating a consideration how the court a quo could have upheld the validity of the questioned deed of sale. The
of P7,268,400.00, which was the basis for the issuance of Transfer Certificates of Title transaction has all the earmarks of a grand scam perpetrated by the very same persons
Nos. 68493, 68494, 68495, and 68496 in the name of appellee Nordelak is dated 02 appointed by PCGG to safeguard the assets of sequestered companies.[21]
November 1989 but was only registered more than three (3) years later. This bolsters the
testimony of Luis R. Narciso that the owners duplicate original of appellant Mapalads
titles were taken from him by defendant Felicito Manalili in July 1992 and were never The CA further ruled that petitioner Sanchez, who was a transferee pendente lite, was not a buyer
returned. Obviously, Manalili got the titles for the purpose of registering the fictitious
deed of absolute sale because under the Property Registration Decree (P.D. 1529), no in good faith, having purchased the property with an annotation of a notice of lis pendens.
voluntary instrument shall be registered by the Register of Deeds unless the owners
duplicate is presented with the instrument of transfer.
I. The case falls within the exception to the
Without prior motion for reconsideration of the CA decision, intervenor-appellee Sanchez
rule that factual issues may not be
elevated the case to Us, raising the following assignment of errors: entertained by this Court.

I In petitions for review on certiorari such as in the present case, the findings of fact of the CA are generally
conclusive on this Court, save for the following admitted exceptions:
CONTRARY TO THE EXPRESS FINDINGS OF THE TRIAL COURT THAT THE
QUESTIONED DEED OF SALE IS GENUINE, VALID AND SUBSISTING, THE
COURT OF APPEALS RULED THAT THERE WAS FRAUD ON THE PART OF (1) the factual findings of the Court of Appeals and the trial court are
NORDELAK IN OBTAINING THE CERTIFICATES OF TITLES OVER THE contradictory;
DISPUTED PROPERTY, AND CONSEQUENTLY THE QUESTIONED DEED IS
FICTITIOUS. (2) the findings are grounded entirely on speculation, surmises or conjectures;

II (3) the inference made by the Court of Appeals from its findings of fact is
mainly mistaken, absurd or impossible;
COROLLARILY, CONTRARY TO THE EXPRESS FINDINGS OF THE TRIAL
COURT THAT NORDELAK IS A BUYER IN GOOD FAITH AND FOR
VALUE, THE COURT OF APPEALS RULED OTHERWISE. (Underscoring supplied) (4) there is grave abuse of discretion in the appreciation of facts;

(5) the appellate court, in making its findings, goes beyond the issues of the case
and such findings are contrary to the admissions of both appellant and appellee;

(6) the judgment of the Court of Appeals is premised on a misapprehension of


Issues facts;

(7) the Court of Appeals fails to notice certain relevant facts which, if properly
Two critical issues are plainly posed for our determination. First, on whether or not there was a valid sale considered, will justify a different conclusion; and

between Mapalad and Nordelak. Second, whether or not petitioner Sanchez acquired valid title over the (8) the findings of fact of the Court of Appeals are contrary to those of the trial
court or are mere conclusions without citation of specific evidence, or where
properties as innocent purchaser for value despite a defect in Nordelaks title.
the facts set forth by the petitioner are not disputed by respondent, or where the
findings of fact of the Court of Appeals are premised on the absence of evidence
but are contradicted by the evidence on record.[22]
A procedural issue was raised by the Solicitor General in his Comment, too: whether or not petitioner may
raise questions of fact in the present petition.
We note that the basis for the trial courts disposition in favor of Nordelak is Mapalads apparent
failure to adduce sufficient evidence to prove that Miguel Magsaysays signatures on the two deeds of sale
We shall resolve them in the reverse order, dealing with the procedural ahead of the substantive question.
by Mapalad in favor of Nordelak were forged.

Our Ruling
The CA, however, went beyond the mere determination of whether the signatures of Miguel
Magsaysay were forged or not. It looked into the validity of the deed of absolute sale as a whole, based on
the testimonies of Miguel Magsaysay himself, quoted in its decision, as follows:
authority to sign for and in behalf of Mapalad because as early as 1982, he had already divested himself of
Atty Calabio: x x x I am showing to you this Deed of Absolute Sale marked as Exhibit
D, there is here appearing on page 3 above the typewritten name Miguel A. Magsaysay, all his interests in said corporation. His testimonies in this case constitute sufficient basis for the Court to
is this your signature? conclude that the signatures appearing on the two deeds of sale (Exhibits D and F) were not his signatures.

A: No, definitely not, so far away from my signature, not even in forgery; and besides I
am not the president when it was sold already. This factual determination on the genuineness or forgery of the signatures purporting to be those

Q: So on the date herein November 2, 1989, you were no longer president, Sir? of Miguel Magsaysay on the subject deeds of sale is most crucial. When compared with this one, all other
factual issues raised in the petition become immaterial, such as: whether the owners duplicate copies of the
A: No, I have nothing to do with them, of the corporation, after the sale in 1982.
TCT were voluntarily delivered to, or surreptitiously taken from Mapalads custodian of such documents;
Atty. Calabio: Likewise, showing to you the Deed of Absolute Sale, also
whether the deeds of sale were in fact notarized by Atty. Elpidio Clemente considering that these
dated November 2, 1989, previously marked as Exhibit F, specifically on page 3, Sir,
there is a signature also above the typewritten name, Miguel Magsaysay? documents do not exist in the archives or files in the notarial registry; or even whether there were two or

A: Definitely, this is not my signature, and besides I am not the president anymore. It only one document purporting to be the deed of absolute sale dated November 2, 1989.
looks exactly like the other one.

Atty. Calabio: Which for purposes of identification, Your Honor, may I respectfully There is, therefore, no cogent reason for this Court to delve further into these other factual matters.
request that his also be encircled and marked as Exhibit F-1?[23]

II. There can be no valid contract of sale


Aside from categorically denying under oath that the signatures appearing on the deeds of absolute between Mapalad and Nordelak.

sale were his, witness Miguel Magsaysay gave another reason why it was impossible for those signatures
to be his. According to him, he was no longer connected in any way whatsoever with Mapalad, when it A contract is defined as a juridical convention manifested in legal form, by virtue of which one

supposedly sold the properties. He divested himself of all his interests in Mapalad way back in 1982. There or more persons bind themselves in favor of another, or others, or reciprocally, to the fulfillment of a

was no reason for him to sign the subject deeds of absolute sale as president and chairman of the board of prestation to give, to do, or not to do. There can be no contract unless the following concur: (a) consent of

Mapalad in 1989. This was another basis for Mapalad to convince the appellate court that the signatures the contracting parties; (b) object certain which is the subject matter of the contract; (c) cause of the

purporting to be those of Magsaysay on the questioned deeds of sale were not written by him. obligation which is established.[25]

We sustain the CA finding and conclusion. Specifically, by the contract of sale, one of the contracting parties obligates himself to transfer
ownership of and to deliver a determinate thing and the other party to pay therefor a price certain in money

While there have been guidelines cited in the petition[24] used by this Court in determining what or its equivalent.[26]

constitutes sufficient proof to establish whether a signature was forged, it does not preclude a party from
adducing other possible proofs to establish whether a particular signature is genuine or not. The essential requisites of a valid contract of sale are:

In the case at bench, not only did Magsaysay disown the signatures appearing on the deed of sale,
he cited a valid legal reason for him not to have signed such document at all. He had no more power and
(1) Consent of the contracting parties by virtue of which the vendor obligates himself to were infused into Mapalads coffers on account of this transaction. This testimony remained
transfer ownership of and to deliver a determinate thing, and the vendee obligates himself to pay therefor a uncontroverted. In fact, the CA further noted that Nordelak could have easily produced the cancelled check
price certain in money or its equivalent. before the trial court, if there was any. Again, Nordelak did not.

(2) Object certain which is the subject matter of the contract. The object must be licit and The third element for a valid contract of sale is likewise lacking.
at the same time determinate or, at least, capable of being made determinate without the necessity of a new
or further agreement between the parties. Lack of consideration makes a contract of sale fictitious. A fictitious sale is void ab initio.[30]

(3) Cause of the obligation which is established. The cause as far as the vendor is The alleged deed of absolute sale dated November 2, 1989 notwithstanding, the contract of sale
concerned is the acquisition of the price certain in money or its equivalent, which the cause as far as the between Mapalad and Nordelak is not only voidable on account of lack of valid consent on the part of the
vendee is concerned is the acquisition of the thing which is the object of the contract. [27] purported seller, but also void ab initio for being fictitious on account of lack of consideration.

Contracts of sale are perfected by mere consent, which is manifested by the meeting of the offer Despite a void sale between Mapalad and Nordelak, may petitioner still claim valid title to the
and the acceptance upon the thing and the cause which are to constitute the contract.[28] subject properties?

III. Petitioner as
Consent may be given only by a person with the legal capacity to give consent. In the case of
transferee pendente lite merely steps
juridical persons such as corporations like Mapalad, consent may only be granted through its officers who into the shoes of his predecessor-in-
interest who had no valid title.
have been duly authorized by its board of directors. [29]

As We have said, Nordelak did not acquire ownership or title over the four properties subject of
In the present case, consent was purportedly given by Miguel Magsaysay, the person who signed
this case because the contract of sale between Mapalad and Nordelak was not only voidable but also
for and in behalf of Mapalad in the deed of absolute sale dated November 2, 1989. However, as he
void ab inito. Not having any title to the property, Nordelak had nothing to transfer to petitioner Sanchez.
categorically stated on the witness stand during trial, he was no longer connected with Mapalad on the said
date because he already divested all his interests in said corporation as early as 1982. Even assuming, for
Nemo dat non quod habet. Hindi maibibigay ng isang tao ang hindi kanya. No one can give
the sake of argument, that the signatures purporting to be his were genuine, it would still be voidable for
what he does not have.
lack of authority resulting in his incapacity to give consent for and in behalf of the corporation.

Petitioner acquired the property subject of litigation during the pendency of the case in the trial
On this score, the contract of sale may be annulled for lack of consent on the part of Mapalad.
court. It is undisputed that notices of lis pendens were annotated on the TCTs in Nordelaks name covering
the subject properties as Entry No. 93-91718.
The CA also noted that the alleged contract of sale on November 2, 1989 had no
consideration. There was no payment effected by Nordelak for this transaction. Josef testified that no funds
In Lim v. Vera Cruz,[31] this Court explained:

Lis pendens is a Latin term which literally means a pending


suit. Notice of lis pendens is filed for the purpose of warning all persons that the title to
certain property is in litigation and that if they purchase the same, they are in danger of
being bound by an adverse judgment. The notice is, therefore, intended to be a warning
to the whole world that one who buys the property does so at his own risk. This is
necessary in order to save innocent third persons from any involvement in any future
litigation concerning the property.

By virtue of the notice of lis pendens annotated on the four TCTs in this case, petitioner had notice
that the property he was intending to buy is under litigation. He is, therefore, a transferee pendente lite who,
as held by this Court in Voluntad v. Dizon,[32] stands exactly in the shoes of the transferor and is bound by
any judgment or decree which may be rendered for or against the transferor.

Under the circumstances petitioner cannot acquire any better right than his predecessor,
Nordelak. No river or stream can rise higher than its source. Walang ilog o batis na ang taas ay higit sa
kanyang pinagmulan. There is thus no question that a judgment of reconveyance can be legally enforced
by Mapalad against petitioner as transferee pendente lite of Nordelak.
The four parcels of land surrendered by former Marcos associate Jose Y. Campos and sequestered
by the PCGG must eventually be returned to their rightful owners. If forfeiture proceedings in the Marcos
ill-gotten wealth cases prosper, and these properties are finally shown to form part of such ill-gotten wealth,
these properties should go to the Filipino people. If they are not ill-gotten, they should be turned over to
the Marcoses. But definitely, these properties cannot be transferred to Nordelak nor to petitioner Manuel
Luis Sanchez.

WHEREFORE, the petition is hereby DENIED and the appealed Court of Appeals
decision AFFIRMED in toto.

SO ORDERED.