1443
to convey the property to the true
The trustee may be accorded the right
to prosecute a suit, but only on behalf
of the beneficiary who must be
included in the title of the case and
shall be deemed to be the real party-
in-interest. (Marcos-Araneta vs. Court
of Appeals, 362 SCRA 41 [2008].)
1444
While no time limit is imposed for the
enforcement of rights under an
express trust, prescription may,
however, bar a beneficiary’s action for
recovery, if a repudiation of the trust
is proven by clear and convincing
evidence and made known to the
beneficiary. (Secuya vs. Vda. de Selma,
326 SCRA 244 [2000].)
1447
His mere receipts of rents and profits
from the property, the erection of
fences and buildings adapted for the
cultivation of the land held in trust,
and the payment of land taxes, do not
by themselves serve as proof of
exclusive ownership. (Huang vs. Court
of Appeals, 236 SCRA 420 [1994];
Salvador vs. Court of Appeals, 243
SCRA 239 [1995].)
It is now well-settled that an action for
reconveyance to enforce an implied
trust in one’s favor prescribes in ten
(10) years from the time the right of
action accrues, the action being based
upon an obligation created by law (see
Art. 1144[2].) because just as a
resulting trust is an offspring of the
law, so is the corresponding obligation
owner. (Huang vs. Court of Appeals,
236 SCRA 420 [1994].)
The parties must necessarily be
subject to the same limitations on
allowable stipulations in ordinary
contracts. What the parties then
cannot expressly provide in their
contracts for being contrary to law,
morals, good customs, public order, or
public policy (Art. 1306.), they cannot
impliedly or implicitly do so in the
guise of a resulting trust. Thus, if the
purpose of the payor of the
consideration in having title placed in
the name of another was to evade
some rule of law, the courts will not
assist the payor in achieving his
improper purpose (e.g., an alien or
applicant who is ineligible to hold title
to land, who used a person as a
dummy) by enforcing a resulting trust
for him in accordance with the “clean
hands’’ doctrine. The trust is invalid if
its enforcement would be against
public policy, even though its
performance does not involve the
commission of a criminal or tortious
act by the trustee. However, the court,
on equitable grounds, may allow the
payor to recover what he had paid
with legal interest. (Ramos vs. Court of
Appeals, 232 SCRA 348 [1994]; Pigao
vs. Rabanillo, 488 SCRA 546 [2006].)
1450 cannot be used as a shield for frauds
and the prescriptive period for the
An agreement between the parties filing of the action for reconveyance
whereby the property purchased shall based on implied trust must be
be considered sold to the trustee in reckoned from the actual discovery of
case the beneficiary fails to reimburse the fraud where such discovery was
him is tantamount to a pactum made after the date of registration.
commissorium, which is expressly (see Government Service Insurance
prohibited by Article 2088 of the Civil System vs. Santiago, 414 SCRA 563
Code12 for in such case there would
[2003]; Adille vs. Court of Appeals,
be automatic appropriation of the supra; Samonte vs. Court of Appeals,
property by the trustee in the event of
361 SCRA 173 [2001].)
failure of the beneficiary to pay the
loan. (Nakpil vs. Intermediate The principle that a trustee who takes
Appellate Court, 225 SCRA 456 a torrens title in his name cannot
[1993].) repudiate the trust by relying on the
registration, is a well-known exception
1456
to the principle of conclusiveness of a
certificate of title. (Adriano vs. Court
Generally, an action for reconveyance
of Appeals, 328 SCRA 738 [2000].)
of real property based exclusively on
fraud prescribes in four (4) years from
the discovery of the fraud; 8 such
discovery is deemed to have taken
place upon the issuance of the
certificate of title over the property. If
the action is based on implied or
constructive trust, it prescribes in 10
years from the alleged fraudulent
registration or date of issuance of the
certificate of title over the property.
(see Art. 1456.) Since such registration
or issuance operates as a constructive
notice to the whole world, the
discovery is deemed to have taken
place at that time. (Bejoc vs. Cabreros,
464 SCRA 78 [2005].) This is the
general rule. It has been held,
however, that where the defendant
acted in bad faith in securing title over
real property, he is not entitled to the
protection of the law for the law