FIRST DIVISION Psu-206650; and on the SE.

,
along line 15-1, by Lot 5 of
G.R. No. L-46892 September 30, 1981 plan Psu- 206650 ... ;
containing an area of ONE
HUNDRED EIGHTY ONE
HEIRS OF AMPARO DEL ROSARIO, plaintiffs-appellees, 
THOUSAND FOUR
vs.
HUNDRED TWENTY
AURORA O. SANTOS, JOVITA SANTOS GONZALES, ARNULFO
(181,420) SQUARE
O. SANTOS, ARCHIMEDES O. SANTOS, ERMELINA SANTOS
METERS. All points referred
RAVIDA, and ANDRES O. SANTOS, JR., defendants-appellants.
to are indicated on the plan
and are marked on the
ground as follows: ...

GUERRERO, J.: of which above-described property, I own one-

half (1/2) interest thereof being my attorney's fee,
The Court of Appeals, 1 in accordance with Section 31 of the and the said 20,000 square meters will be
Judiciary Act of 1948, as amended, certified to Us the appeal transferred unto the VENDEE as soon as the title
docketed as CA-G.R. No. 56674-R entitled "Amparo del Rosario, thereof has been released by the proper authority
plaintiff-appellee, vs. Spouses Andres Santos and Aurora Santos, or authorities concerned:
defendants-appellants," as only questions of law are involved.
That the parties hereto hereby agree that the
On January 14, 1974, Amparo del Rosario filed a complaint against VENDOR shall execute a Deed of Confirmation
the spouses Andres F. Santos and Aurora O. Santos, for specific of Deed of Sale in favor of the herein VENDEE
performance and damages allegedly for failure of the latter to as soon as the title has been released and the
execute the Deed of Confirmation of Sale of an undivided 20,000 subdivision plan of said Lot 1 has been approved
square meters of land, part of Lot 1, Psu-206650, located at Barrio by the Land Registration Commissioner.
Sampaloc, Tanay, Rizal, in malicious breach of a Deed of Sale
(Exhibit A or 1) dated September 28, 1964. IN WITNESS WHEREOF, I have hereunto set
my hand this 28th day of September, 1964, in the
Amparo del Rosario died on Sept. 21, 1980 so that she is now City of Manila, Philippines.
substituted by the heirs named in her will still undergoing probate
proceedings. Andres F. Santos also died, on Sept. 5, 1980, and he is s/ ANDRES F. SANTOS t/ ANDRES F. SANTOS
substituted by the following heirs: Jovita Santos Gonzales, Arnulfo O.
Santos, Archimedes O. Santos, Germelina Santos Ravida, and
With My Marital Consent:
Andres O. Santos, Jr.

s/ Aurora O. Santos (Wife) t/ Aurora O. Santos

The Deed of Sale (Exh. A or 1) is herein reproduced below:
(Wife)
DEED OF SALE
SIGNED IN THE PRESENCE OF: s/ Felicitas C.
Moro s/ Corona C. Venal
KNOW ALL MEN BY THESE PRESENTS:
REPUBLIC OF THE PHILIPPINES) ) SS.
I, ANDRES F. SANTOS, of legal age, married to
Aurora 0. Santos, Filipino and resident cf San
BEFORE ME, a Notary Public for and in Rizal,
Dionisio, Paranaque, Rizal, Philippines, for and in
Philippines, personally appeared Andres F.
consideration of the sum of TWO THOUSAND (P
Santos, with Res. Cert. No. 4500027 issued at
2,000.00) PESOS, Philippine Currency, the
Paranaque, Rizal, on Jan. 9, 1964, B-0935184
receipt whereof is hereby acknowledged, do
issued at Paranaque, Rizal on April 15, 1964,
hereby SELLS, CONVEYS, and TRANSFERS
and Aurora 0. Santos, with Res. Cert. No. A-
(sic) unto Amparo del Rosario, of legal age,
4500028 issued at Paranaque, Rizal, on Jan. 9,
married to Fidel del Rosario but with legal
1964, giving her marital consent to this
separation, Filipino and resident of San Dionisio,
instrument, both of whom are known to me and
Paranaque, Rizal, Philippines that certain 20,000
to me known to be the same persons who
square meters to be segregated from Lot 1 of
executed the foregoing instruments and they
plan Psu-206650 along the southeastern portion
acknowledged to me that the same is their free
of said lot, which property is more particularly
act and voluntary deed.
described as follows:

IN WITNESS WHEREOF, I have hereunto

A parcel of land (Lot 1 as
signed this instrument and affixed my notarial
shown on plan Psu-206650,
seal this lst day of October, 1964, in Pasig, Rizal,
situated in the Barrio of
Philippines.
Sampaloc, Municipality of
Tanay, Province of Rizal.
Bounded on the SW., along Doc. No. 1792; Page No. 85; Book No. 19;
lines 1-2-3, by Lot 80 of Series of 1964.
Tanay Public Land
Subdivision, Pls-39; on the s/ FLORENCIO LANDRITO t/ FLORENCIO
NW., along lines 3-4-5, by LANDRITO
Lot 2; and along lines 5-6-7-
8-9-10-11, by Lot 6; on the NOTARY PUBLIC Until December 31, 1965 2
NE., along lines 11-12-13, by
Lot 3: and along lines 13- Plaintiff claimed fulfillment of the conditions for the execution of the
1415, by Lot 4, all of plan Deed of Confirmation of Sale, namely: the release of the title of the
lot and the approval of the subdivision plan of said lot by the Land
Registration Commission. She even enumerated the titles with their
corresponding land areas derived by defendants from the aforesaid
lot, to wit:
(a) TCT 203580 — 30,205 sq. meters
(b) TCT 203581 — 19, 790 sq. meters
(c) TCT 167568 — 40,775 sq. meters
In a motion to dismiss, defendants pleaded, inter alia, the defenses
of lack of jurisdiction of the court a quo over the subject of the action
and lack of cause of action allegedly because there was no allegation
as to the date of the approval of the subdivision plan, no specific
statement that the titles therein mentioned were curved out of Lot I
and no clear showing when the demands were made on the
defendants. They likewise set up the defense of prescription
allegedly because the deed of sale was dated September 28, 1964
and supposedly ratified October 1, 1964 but the complaint was filed
only on January 14, 1974, a lapse of more than nine years when it
should have been filed within five years from 1964 in accordance
with Article 1149, New Civil Code.
Defendant also claimed that the demand set forth in the complaint
has been waived, abandoned or otherwise extinguished. It is alleged
that the deed of sale was "only an accommodation graciously
extended, out of close friendship between the defendants and the
plaintiff and her casual business partner in the buy and sell of real
estate, one Erlinda Cortez;" 3 that in order to allay the fears of plaintiff
over the non-collection of the debt of Erlinda Cortez to plaintiff in
various sums exceeding P 2,000.00, defendants, who were in turn
indebted to Erlinda Cortez in the amount of P 2,000.00, voluntarily
offered to transfer to plaintiff their inexistent but expectant right over
the lot in question, the same to be considered as part payment of
Erlinda Cortez' indebtedness; that as Erlinda Cortez later on paid her
creditor what was then due, the deed of sale had in effect been
extinguished. Defendants thereby characterized the said deed of sale
as a mere tentative agreement which was never intended nor meant
to be ratified by and acknowledged before a notary public. In fact,
they claimed that they never appeared before Notary Public
Florencio Landrito.
Finally, defendants alleged that the claim on which the action or suit
is founded is unenforceable under the statute of frauds and that the
cause or object of the contract did not exist at the time of the
transaction.
After an opposition and a reply were filed by the respective parties,
the Court a quo  resolved to deny the motion to dismiss of
defendants. Defendants filed their answer with counterclaim
interposing more or less the same defenses but expounding on them
further. In addition, they claimed that the titles allegedly derived by
them from Lot 1 of Annex A or I were cancelled and/or different from
said Lot I and that the deed of sale was simulated and fictitious,
plaintiff having paid no amount to defendants; and that the deed was
entrusted to plaintiff's care and custody on the condition that the
latter; (a) would secure the written consent of Erlinda Cortez to
Annex A or I as part payment of what she owed to plaintiff; (b) would
render to defendants true accounting of collections made from
Erlinda showing in particular the consideration of 2,000.00 of Annex
A or I duly credited to Erlinda's account. 4
Plaintiff filed a reply and answer to counterclaim and thereafter a
motion for summary judgment and/or judgment on the pleadings on
the ground that the defenses of defendants fail to tender an issue or
the same do not present issues that are serious enough to deserve a
trial on the merits, 5 submitting on a later date the affidavit of merits.
Defendants filed their corresponding opposition to the motion for
summary judgment and/or judgment on the pleadings. Not content
with the pleadings already submitted to the Court, plaintiff filed a
reply while defendants filed a supplemental opposition.
With all these pleadings filed by the parties in support of their
respective positions, the Court a quo still held in abeyance plaintiff's
motion for summary judgment or judgment on the pleadings pending
the pre-trial of the case. At the pre-trial, defendants offered by way of
compromise to pay plaintiff the sum of P2,000.00, the consideration
stated in the deed of sale. But the latter rejected the bid and insisted
on the delivery of the land to her. Thus, the pre-trial proceeded with
the presentation by plaintiff of Exhibits A to Q which defendants
practically admitted, adopted as their own and marked as Exhibits 1
to 17. In addition, the latter offered Exhibit 18, which was their reply
to plaintiff's letter of demand dated December 21, 1973.
From the various pleadings filed in this case by plaintiff, together with
the annexes and affidavits as well as the exhibits offered in evidence
at the pre-trial, the Court a quo found the following facts as having
been duly established since defendant failed to meet them with
countervailing evidence:
In February, 1964, Teofilo Custodia owner of a
parcel of unregistered land with an area of
approximately 220,000 square meters in Barrio
Sampaloc, Tanay, Rizal, hired Attorney Andres
F. Santos "to cause the survey of the above-
mentioned property, to file registration
proceedings in court, to appear and represent
him in all government office relative thereto, to
advance all expenses for surveys, taxes to the
government, court fees, registration fees ... up to
the issuance of title in the name" of Custodia.
They agreed that after the registration of the title
in Custodio's name, and "after deducting all
expenses from the total area of the property,"
Custodio would assign and deliver to Santos
"one-half (1/2) share of the whole property as
appearing in the certificate of title so issued."
Exh. B or 2).
On March 22, 1964, Custodio's land was
surveyed under plan Psu-226650 (Exh. D or 4). It
was divided into six (6) lots, one of which was a
road lot. The total area of the property as
surveyed was 211,083 square meters. The
respective areas of the lots were as follows:
Lot 1 181,420 square
meters
Lot 2 7,238 square
meters
Lot 3 7,305 square
meters
Lot 4 5,655 square
meters
Lot 5 5,235 square
meters
Road Lot 6 4,230 square
meters
TOTAL 211,083 square
meters
xxx xxx xxx
On December 27, 1965, a decree of registration
No. N-108022 was issued in Land Registration
Case No. N-5023, of the Court of First Instance
of Rizal, LRC Record No. N-27513, in favor of
Teofilo Custodia married to Miguela Perrando
resident of Tanay, Rizal. On March 23, 1966,
 Original Certificate of Title No. 5134 (Exh. Q or 167565 (Exhs. G and H) were cancelled. TCT
17) was issued to Custodio for Lots 1, 2, 3, 4 and No. 167568 (Exh. I or 9) for Lot 4 and TCT No.
5, Psu- 206650, with a total area of 206,853 167585 (Exh. J or 10) for Lot 5 were issued to
square meters. The areas of the five (5) lots were Santos.
as follows:
On September 2, 1967, Santos' Lot 5, with an
area of 50,000 square meters was subdivided
Lot 1 181,420 square
into two (2) lots, designated as Lots 5-A and 5-B
meters
in the plan Psd-78008 (Exh. F or 6), with the
Lot 2 7,238 square following areas:
meters
Lot 30,205
Lot 3 7,305 square 5-A square
meters meters
Lot 4 5,655 square Lot 19,795squ
meters 5-B are
meters
Lot 5 5,235 square
meters TOT 50,000
AL square
In April to May, 1966, a consolidation-subdivision meters
survey (LRC) Pcs-5273 (Exh. E or 5) was made
on the above lots converting them into six (6) Upon registration of Psd-78008 on October 3,
new lots as follows: 1967, Santos' TCT No. 167585 (Exh. J) was
cancelled and TCT No. 203578 for Lot 5- A and
xxx xxx xxx TCT No. 203579 for Lot 5-B were supposed to
have been issued to Santos (See Entry 6311 in
Exh. J or 10). Actually, TCT No. 203580 was
Lot 1 20,000 square
issued for Lot 5-A (Exh. K or 1 1), and TCT No.
meters
203581 for Lot 5-B (Exh. L or 12), both in the
Lot 2 40,775 square name of Andres F. Santos.
meters
Out of Custodio's original Lot 1, Psu-206650, with
Lot 3 50,000 square an area of 181,420 square meters, Santos was
meters given a total of 90,775 square meters, registered
in his name as of October 3, 1967 under three (3)
Lot 4 40,775 square titles, namely:
meters

Lot 5 50,000 square    

meters
TCT No. 167585
Road Lot 6 5,303 square for
meters
Lot 4 Pcs-5273 40,775 sq. m.
TOTAL 206,853 square
meters (Exh. J or 10)  

TCT No. 203580  

On June 22, 1966, the consolidation-subdivision for
plan (LRC) Pcs-5273 (Exh. E or 5) was approved
by the Land Registration Commission and by the Lot 5-A Psd- 30,205 sq. m.
Court of First Instance of Rizal in an order dated 78008
July 2, 1966 (Entry No. 61037 T-167561, Exh.
Q). Upon its registration, Custodio's O.C.T. No. (Exh. K or 11)  
5134 (Exh. Q) was cancelled and TCT Nos.
167561, 167562, 167563, 167564 (Exh. G), TCT No. 203581  
167565 (Exh. H and 167566 were issued for the for
six lots in the name of Custodio (Entry No.
61035, Exh. Q). Lot 5-B Psd- 19,795 sq. m.
78008
On June 23, 1966, Custodio conveyed to Santos
(Exh. L or 12)  
Lots 4 and 5, Pcs-5273 with a total area of
90,775 square meters (Exh. B or 2) described in
  90,775 sq.m.
Custodio's TCT No. 167564 (Exh. G or 7) and
TCT No. 167565 (Exh. H or 8), plus a one-half
interest in the Road Lot No. 6, as payment of plus one-half of the road lot, Lot 6, PCS-5273,
Santos' attorney's fees and advances for the with an area of 5,303 square meters, which is
registration of Custodio's land. registered jointly in the name of Santos and
Custodio (Exh. B & E) 6
Upon registration of the deed of conveyance on
July 5, 1966, Custodio's TCT Nos. 167564 and
The court a quo thereupon concluded that there are no serious
factual issues involved so the motion for summary judgment may be
properly granted. Thereafter, it proceeded to dispose of the legal
issues raised by defendants and rendered judgment in favor of
plaintiff. The dispositive portion of the decision states as follows:
WHEREFORE, defendants Andres F. Santos
and Aurora Santos are ordered to execute and
convey to plaintiff Amparo del Rosario, within ten
(10) days from the finality of this decision, 20,000
square meters of land to be taken from the
southeastern portion of either Lot 4, Pcs-5273,
which has an area of 40,775 square meters,
described in TCT No. 167568 (Exh. I or 9) of
from their LOL 5-A. with an area of 30,205
square meters, described in TCI No. 203; O
(Exh. K or 11). The expenses of segregating the
20,000 square meters portion shall be borne
fqually by the parties. rhe expenses for the
execution and registration of the sale shall be
borne by the defendants (Art. 1487, Civil Code).
Since the defendants compelled the plaintiff to
litigate and they failed to heed plainliff's just
demand, they are further ordered to pay the
plaintiff the sum of P2,000.00 as attorney's fees
and the costs of this action.
SO ORDERED. 7
Aggrieved by the aforesaid decision, the defendant's filed all appeal
to the Court of Appeals submitting for resolution seven assignments
of errors, to wit:
I. The lower court erred in depriving the
appellants of their right to the procedural due
process.
II. The lower court erred in holding that the
appellee's claim has not been extinguished.
III. The lower court erred in sustaining appellee's
contention that there are no other unwritten
conditions between the appellants and the
appellee except those express in Exh. "1" or "A",
and that Erlinda Cortez' conformity is not required
to validate the appellants' obligation.
IV. The lower court erred in holding that Exh. "l"
or "A" is not infirmed and expressed the true
intent of the parties.
V. The lower court erred in declaring that the
appellants are co-owners of the lone registered
owner Teofilo Custodia.
VI. The lower court erred in ordering the
appellants to execute and convey to the appellee
20,000 sq. m. of land to be taken from the
southeastern portion of either their lot 4, Pcs-
5273, which has an area of 40,775 sq.m.,
described in T.C.T. No. 167568 (Exh. 9 or 1), or
from their lot No. 5-A, with an area of 30,205
sq.m. described in T.C.T. No. 203580 (Exh. 11 or
K), the expenses of segregation to be borne
equally by the appellants and the appellee and
the expenses of execution and registration to be
borne by the appellants.
VII.
Thelowercourterredinorderingtheappellantstopayt
o the appellee the sum of P2,000. 00 as
attorney's fee and costs. 8
The first four revolve on the issue of the propriety of the rendition of
summary judgment by the court a quo, which concededly is a
question of law. The last three assail the summary judgment itself.
Accordingly, the Court of Appeals, with whom the appeal was filed,
certified the records of the case to this Court for final determination.
For appellants herein, the rendition of summary judgment has
deprived them of their right to procedural due process. They claim
that a trial on the merits is indispensable in this case inasmuch as
they have denied under oath all the material allegations in appellee's
complaint which is based on a written instrument entitled "Deed of
Sale", thereby putting in issue the due execution of said deed.
Appellants in their opposition to the motion for summary judgment
and/or judgment on the pleadings, however, do not deny the
genuineness of their signatures on the deed of sale.
(Par. 3 of said Motion, p. 101, Record on Appeal). They do not
contest the words and figures in said deed except in the
acknowledgment portion thereof where certain words were allegedly
cancelled and changed without their knowledge and consent and
where, apparently, they appeared before Notary Public Florencio
Landrito when, in fact, they claimed that they did not. In effect, there
is an admission of the due execution and genuineness of the
document because by the admission of the due execution of a
document is meant that the party whose signature it bears admits
that voluntarily he signed it or that it was signed by another for him
and with his authority; and the admission of the genuineness of the
document is meant that the party whose signature it bears admits
that at the time it was signed it was in the words and figures exactly
as set out in the pleading of the party relying upon it; and that any
formal requisites required by law, such as swearing and
acknowledgment or revenue stamps which it requires, are waived by
him. 9
As correctly pointed out by the court a quo, the alleged false
notarization of the deed of sale is of no consequence. For a sale of
real property or of an interest therein to be enforceable under the
Statute of Frauds, it is enough that it be in writing. 10 It need not be
notarized. But the vendee may avail of the right under Article 1357 of
the New Civil Code to compel the vendor to observe the form
required by law in order that the instrument may be registered in the
Registry of Deeds. 11 Hence, the due execution and genuineness of
the deed of sale are not really in issue in this case. Accordingly,
assigned error I is without merit.
What appellants really intended to prove through the alleged false
notarization of the deed of sale is the true import of the matter, which
according to them, is a mere tentative agreement with appellee. As
such, it was not intended to be notarized and was merely entrusted
to appellee's care and custody in order that: first, the latter may
secure the approval of one Erlinda Cortez to their (appellants') offer
to pay a debt owing to her in the amount of P2,000.00 to appellee
instead of paying directly to her as she was indebted to appellee in
various amounts exceeding P2,000.00; and second once the
approval is secured, appellee would render an accounting of
collections made from Erlinda showing in particular the consideration
of P2,000.00 of the deed of sale duly credited to Erlinda's account.
According to appellants, they intended to prove at a full dress trial the
material facts: (1) that the aforesaid conditions were not fulfilled; (2)
that Erlinda Cortez paid her total indebtedness to appellee in the
amount of P14,160.00, the P2,000.00 intended to be paid by
appellant included; and (3) that said Erlinda decided to forego,
renounce and refrain from collecting the P2,000.00 the appellants
owed her as a countervance reciprocity of the countless favors she
also owes them.
Being conditions which alter and vary the terms of the deed of sale,
such conditions cannot, however, be proved by parol evidence in
view of the provision of Section 7, Rule 130 of the Rules of Court
which states as follows:
 Sec. 7. Evidence of written agreements when the Examining the pleadings, affidavits and exhibits in the records, We
terms of an agreement have been reduced to find that appellants have not submitted any categorical proof that
writing, it is to be considered as containing all Erlinda Cortez had paid the P2,000.00 to appellee, hence, appellants
such terms, and, therefore, there can be, failed to substantiate the claim that the cause of action of appellee
between the parties and their successors in has been extinguished. And while it is true that appellants submitted
interest, no evidence of the terms of the a receipt for P14,160.00 signed by appellee, appellants, however,
agreement other than the contents of the writing, have stated in their answer with counterclaim that the P2,000.00
except in the following cases: value of the property covered by the Deed of Sale, instead of being
credited to Erlinda Cortez, was conspicuously excluded from the
(a) Where a mistake or imperfection of the accounting or receipt signed by appellee totalling P14,160.00. The
writing, or its failure to express the true intent and aforesaid receipt is no proof that Erlinda Cortez subsequently paid
agreement of the parties, or the validity of the her P2,000.00 debt to appellee. As correctly observed by the court a
agreement is put in issue by the pleadings; quo, it is improbable that Cortez would still pay her debt to appellee
since Santos had already paid it.
(b) When there is an intrinsic ambiguity in the
writing. The term "agreement" includes wills." Appellants' claim that their P2,000.00 debt to Erlinda Cortez had
been waived or abandoned is not also supported by any affidavit,
document or writing submitted to the court. As to their allegation that
The parol evidence rule forbids any addition to or contradiction of the
the appellee's claim is barred by prescription, the ruling of the trial
terms of a written instrument by testimony purporting to show that, at
court that only seven years and six months of the ten-year
or before the signing of the document, other or different terms were
prescription period provided under Arts. 1144 and 155 in cases of
orally agreed upon by the parties. 12
actions for specific performance of the written contract of sale had
elapsed and that the action had not yet prescribed, is in accordance
While it is true, as appellants argue, that Article 1306 of the New Civil with law and, therefore, We affirm the same.
Code provides that "the contracting parties may establish such
stipulations, clauses, terms and conditions as they may deem
The action of the court a quo in rendering a summary judgment has
convenient, provided that they are not contrary to law, morals, good
been taken in faithful compliance and conformity with Rule 34,
customs, public order, or public policy" and that consequently,
Section 3, Rules of Court, which provides that "the judgment sought
appellants and appellee could freely enter into an agreement
shall be rendered forthwith if the pleadings, depositions, and
imposing as conditions thereof the following: that appellee secure the
admissions on file together with the affidavits, show that, except as to
written conformity of Erlinda Cortez and that she render an
the amount of damages, there is no genuine issue as to any material
accounting of all collections from her, said conditions may not be
fact and that the moving party is entitled to a judgment as a matter of
proved as they are not embodied in the deed of sale.
law. "
The only conditions imposed for the execution of the Deed of
Resolving assignments of errors, V, VI, and VII which directly assail
Confirmation of Sale by appellants in favor of appellee are the
the summary judgment, not the propriety of the rendition thereof
release of the title and the approval of the subdivision plan. Thus,
which We have already resolved to be proper and correct, it is Our
appellants may not now introduce other conditions allegedly agreed
considered opinion that the judgment of the court  a quo is but a
upon by them because when they reduced their agreement to writing,
logical consequence of the failure of appellants to present any bona
it is presumed that "they have made the writing the only repository
and memorial of truth, and whatever is not found in the writing must fidedefense to appellee's claim. Said judgment is simply the
application of the law to the undisputed facts of the case, one of
be understood to have been waived and abandoned." 13
which is the finding of the court a quo, to which We agree, that
appellants are owners of one-half (1/2) interest of Lot I and,
Neither can appellants invoke any of the exceptions to the parol therefore, the fifth assignment of error of appellants is without merit.
evidence rule, more particularly, the alleged failure of the writing to
express the true intent and agreement of the parties. Such an
By the terms of the Deed of Sale itself, which We find genuine and
exception obtains where the written contract is so ambiguous or
not infirmed, appellants declared themselves to be owners of one-
obscure in terms that the contractual intention of the parties cannot
half (1/2) interest thereof. But in order to avoid appellee's claim, they
be understood from a mere reading of the instrument. In such a case,
now contend that Plan Psu-206650 where said Lot I appears is in the
extrinsic evidence of the subject matter of the contract, of the
exclusive name of Teofilo Custodio as the sole and exclusive owner
relations of the parties to each other, and of the facts and
thereof and that the deed of assignment of one-half (1/2) interest
circumstances surrounding them when they entered into the. contract
thereof executed by said Teofilo Custodio in their favor is strictly
may be received to enable the court to make a proper interpretation
personal between them. Notwithstanding the lack of any title to the
of the instrumental. 14 In the case at bar, the Deed of Sale (Exh. A or
said lot by appellants at the time of the execution of the deed of sale
1) is clear, without any ambiguity, mistake or imperfection, much less
in favor of appellee, the said sale may be valid as there can be a sale
obscurity or doubt in the terms thereof. We, therefore, hold and rule
of an expected thing, in accordance with Art. 1461, New Civil Code,
that assigned errors III and IV are untenable.
which states:
According to the court a quo, "(s)ince Santos, in his Opposition to the
Art. 1461. Things having a potential existence
Motion for Summary Judgment failed to meet the plaintiff's evidence
may be the object of the contract of sale.
with countervailing evidence, a circumstance indicating that there are
no serious factual issues involved, the motion for summary judgment
may properly be granted." We affirm and sustain the action of the trial  
court.
The efficacy of the sale of a mere hope or
Indeed, where a motion for summary judgment and/or judgment on expectancy is deemed subject to the condition
the pleadings has been filed, as in this case, supporting and that the thing will come into existence.
opposing affidavits shall be made on personal knowledge, shall set
forth such facts as may be admissible in evidence, and shall show The sale of a vain hope or expectancy is void.
affirmatively that the affiant is competent to testify as to the matters
stated therein. Sworn or certified copies of all papers or parts thereof In the case at bar, the expectant right came into existence or
referred to in the affidavitshalibeattachedtheretoorservedtherewith. 15 materialized for the appellants actually derived titles from Lot I .
We further reject the contention of the appellants that the lower court
erred in ordering the appellants to execute and convey to the
appellee 20,000 sq.m. of land to be taken from the southeastern
portion of either their Lot 4, Pcs-5273, which has an area of 40,775
sq.m., described in T.C.T. No. 167568 (Exh. 9 or 1), or from their Lot
No. 5-A, with an area of 30,205 sq.m. described in T.C.T. No.
203580 (Exh. 11 or K), the expenses of segregation to be borne
equally by the appellants and the appellee and the expenses of
execution and registration to be borne by the appellants. Their
argument that the southeastern portion of Lot 4 or Lot 5-A is no
longer the southeastern portion of the bigger Lot 1, the latter portion
belonging to the lone registered owner, Teofilo Custodia is not
impressed with merit. The subdivision of Lot I between the appellants
and Teofilo Custodio was made between themselves alone, without
the intervention, knowledge and consent of the appellee, and
therefore, not binding upon the latter. Appellants may not violate nor
escape their obligation under the Deed of Sale they have agreed and
signed with the appellee b3 simply subdividing Lot 1, bisecting the
same and segregating portions to change their sides in relation to the
original Lot 1.

Finally, considering the trial court's finding that the appellants

compelled the appellee to litigate and they failed to heed appellee's
just demand, the order of the court awarding the sum of P2,000.00
as attorney's fees is just and lawful, and We affirm the same.

WHEREFORE, IN VIEW OF THE FOREGOING, the judgment

appealed from is hereby AFFIRMED in toto, with costs against the
appellants.

SO ORDERED.

Makasiar, (Actg. Chairman), Fernandez, De Castro and Melencio-

Herrera, JJ., concur.
 SECOND DIVISION
G.R. NO. 140608             September 23, 2004
PERMANENT SAVINGS AND LOAN BANK, petitioner,  5. Whether or not the defendant is entitled to his
vs.
MARIANO VELARDE, respondent.
DECISION
AUSTRIA-MARTINEZ, J.:
In a complaint for sum of money filed before the Regional Trial Court
of Manila (Branch 37), docketed as Civil Case No. 94-71639,
petitioner Permanent Savings and Loan Bank sought to recover from
respondent Mariano Velarde, the sum of ₱1,000,000.00 plus accrued
interests and penalties, based on a loan obtained by respondent from
petitioner bank, evidenced by the following: (1) promissory note
dated September 28, 1983;1 (2) loan release sheet dated September
28, 1983;2 and (3) loan disclosure statement dated September 28,
1983.3 Petitioner bank, represented by its Deputy Liquidator after it
was placed under liquidation, sent a letter of demand to respondent
on July 27, 1988, demanding full payment of the loan. 4 Despite
receipt of said demand letter,5 respondent failed to settle his account.
Another letter of demand was sent on February 22, 1994, 6 and this
time, respondent’s counsel replied, stating that the obligation "is not
actually existing but covered by contemporaneous or subsequent
agreement between the parties …"7
In his Answer, respondent disclaims any liability on the instrument,
thus:
2. The allegations in par. 2, Complaint, on the existence of
the alleged loan of ₱1-Million, and the purported
documents evidencing the same, only the signature
appearing at the back of the promissory note, Annex "A"
seems to be that of herein defendant. However, as to any
liability arising therefrom, the receipt of the said amount of
P1-Million shows that the amount was received by another
person, not the herein defendant. Hence, no liability
attaches and as further stated in the special and affirmative
defenses that, assuming the promissory note exists, it does
not bind much less is there the intention by the parties to
bind the herein defendant. In other words, the documents
relative to the loan do not express the true intention of the
parties.8
Respondent’s Answer also contained a denial under oath, which
reads:
I, MARIANO Z. VELARDE, of age, am the defendant in this
case, that I caused the preparation of the complaint and
that all the allegations thereat are true and correct; that the
promissory note sued upon, assuming that it exists and
bears the genuine signature of herein defendant, the same
does not bind him and that it did not truly express the real
intention of the parties as stated in the defenses; … 9
During pre-trial, the issues were defined as follows:
1. Whether or not the defendant has an outstanding loan
obligation granted by the plaintiff;
2. Whether or not the defendant is obligated to pay the loan
including interests and attorney’s fees;
3. Whether or not the defendant has really executed the
Promissory Note considering the doubt as to the
genuineness of the signature and as well as the non-
receipt of the said amount;
4. Whether or not the obligation has prescribed on account
of the lapse of time from date of execution and demand for
enforcement; and
counterclaim and other damages.10
On September 6, 1995, petitioner bank presented its sole witness,
Antonio Marquez, the Assistant Department Manager of the
Philippine Deposit Insurance Corporation (PDIC) and the designated
Deputy Liquidator for petitioner bank, who identified the Promissory
Note11 dated September 28, 1983, the Loan Release Sheet 12 dated
September 28, 1983, and the Disclosure Statement of Loan Credit
Transaction.13
After petitioner bank rested its case, respondent, instead of
presenting evidence, filed with leave of court his demurrer to
evidence, alleging the grounds that:
(a) PLAINTIFF FAILED TO PROVE ITS CASE BY
PREPONDERANCE OF EVIDENCE.
(b) THE CAUSE OF ACTION, CONCLUDING ARGUENTI
THAT IT EXISTS, IS BARRED BY PRESCRIPTION
AND/OR LACHES.14
The trial court, in its Decision dated January 26, 1996, found merit in
respondent’s demurrer to evidence and dismissed the complaint
including respondent’s counterclaims, without pronouncement as to
costs.15
On appeal, the Court of Appeals agreed with the trial court and
affirmed the dismissal of the complaint in its Decision 16 dated October
27, 1999.17 The appellate court found that petitioner failed to present
any evidence to prove the existence of respondent’s alleged loan
obligations, considering that respondent denied petitioner’s
allegations in its complaint. It also found that petitioner bank’s cause
of action is already barred by prescription.18
Hence, the present petition for review on certiorari  under Rule 45 of
the Rules Court, with the following assignment of errors:
4.1
THE COURT OF APPEALS ERRED IN HOLDING THAT
PETITIONER FAILED TO ESTABLISH THE
GENUINENESS, DUE EXECUTION AND AUTHENTICITY
OF THE SUBJECT LOAN DOCUMENTS.
4.2
THE COURT OF APPEALS ERRED IN HOLDING THAT
PETITIONER’S CAUSE OF ACTION IS ALREADY
BARRED BY PRESCRIPTION AND OR LACHES.19
Before going into the merits of the petition, the Court finds it
necessary to reiterate the well-settled rule that only questions of law
may be raised in a petition for review on certiorari under Rule 45 of
the Rules of Court, as "the Supreme Court is not a trier of facts." 20 It
is not our function to review, examine and evaluate or weigh the
probative value of the evidence presented.21
There are, however, exceptions to the rule, e.g., when the factual
inferences of the appellate court are manifestly mistaken; the
judgment is based on a misapprehension of facts; or the CA
manifestly overlooked certain relevant and undisputed facts that, if
properly considered, would justify a different legal conclusion. 22 This
case falls under said exceptions.
The pertinent rule on actionable documents is found in Rule 8,
Section 7 of the Rules of Court which provides that when the cause
of action is anchored on a document, the genuineness or due
execution of the instrument shall be deemed impliedly admitted
unless the defendant, under oath, specifically denies them, and sets
forth what he claims to be the facts.
It was the trial court’s opinion that:
The mere presentation of supposed documents regarding
the loan, but absent the testimony of a competent witness
to the transaction and the documentary evidence, coupled
with the denial of liability by the defendant does not suffice
to meet the requisite preponderance of evidence in civil
cases. The documents, standing alone, unsupported by
independent evidence of their existence, have no legal
basis to stand on. They are not competent evidence. Such
failure leaves this Court without ample basis to sustain the
plaintiff’s cause of action and other reliefs prayed for. The
loan document being challenged. (sic) Plaintiff did not exert
additional effort to strengthen its case by the required
preponderance of evidence. On this score, the suit must be
dismissed.23
The Court of Appeals concurred with the trial court’s finding and
affirmed the dismissal of the complaint, viz.:
… The bank should have presented at least a single
witness qualified to testify on the existence and execution
of the documents it relied upon to prove the disputed loan
obligations of Velarde. … This falls short of the requirement
that (B)efore any private writing may be received in
evidence, its due execution and authenticity must be
proved either: (a) By anyone who saw the writing
executed; (b) By evidence of the genuineness of the
handwriting of the maker; or (c) By a subscribing
witness. (Rule 132, Sec. 21, Rules of Court) …
It is not true, as the Bank claims, that there is no need to
prove the loan and its supporting papers as Velarde has
already admitted these. Velarde had in fact denied these in
his responsive pleading. And consistent with his denial, he
objected to the presentation of Marquez as a witness to
identify the Exhibits of the Bank, and objected to their
admission when these were offered as evidence. Though
these were grudgingly admitted anyway, still admissibility
of evidence should not be equated with weight of
evidence. …24
A reading of respondent’s Answer, however, shows that
respondent did not specifically deny that he signed the loan
documents. What he merely stated in his Answer was that
the signature appearing at the back of the promissory note
seems to be his. Respondent also denied any liability on
the promissory note as he allegedly did not receive the
amount stated therein, and the loan documents do not
express the true intention of the parties.25 Respondent
reiterated these allegations in his "denial under oath,"
stating that "the promissory note sued upon, assuming that
it exists and bears the genuine signature of herein
defendant, the same does not bind him and that it did not
truly express the real intention of the parties as stated in
the defenses …"26
Respondent’s denials do not constitute an effective specific denial as
contemplated by law. In the early case of Songco vs. Sellner,27 the
Court expounded on how to deny the genuineness and due
execution of an actionable document, viz.:
… This means that the defendant must declare under oath
that he did not sign the document or that it is otherwise
false or fabricated. Neither does the statement of the
answer to the effect that the instrument was procured by
fraudulent representation raise any issue as to its
genuineness or due execution. On the contrary such a plea
is an admission both of the genuineness and due execution
thereof, since it seeks to avoid the instrument upon a
ground not affecting either.
In fact, respondent’s allegations amount to an implied admission of
the due execution and genuineness of the promissory note. The
admission of the genuineness and due execution of a document
means that the party whose signature it bears admits that he
voluntarily signed the document or it was signed by another for him
and with his authority; that at the time it was signed it was in words
and figures exactly as set out in the pleading of the party relying
upon it; that the document was delivered; and that any formalities
required by law, such as a seal, an acknowledgment, or revenue
stamp, which it lacks, are waived by him.28 Also, it effectively
eliminated any defense relating to the authenticity and due execution
of the document, e.g., that the document was spurious, counterfeit,
or of different import on its face as the one executed by the parties;
or that the signatures appearing thereon were forgeries; or that the
signatures were unauthorized.29
Clearly, both the trial court and the Court of Appeals erred in
concluding that respondent specifically denied petitioner’s allegations
regarding the loan documents, as respondent’s Answer shows that
he failed to specifically deny under oath the genuineness and due
execution of the promissory note and its concomitant documents.
Therefore, respondent is deemed to have admitted the loan
documents and acknowledged his obligation with petitioner; and with
respondent’s implied admission, it was not necessary for petitioner to
present further evidence to establish the due execution and
authenticity of the loan documents sued upon.
While Section 22, Rule 132 of the Rules of Court requires that private
documents be proved of their due execution and authenticity before
they can be received in evidence, i.e.,  presentation and examination
of witnesses to testify on this fact; in the present case, there is no
need for proof of execution and authenticity with respect to the loan
documents because of respondent’s implied admission thereof. 30
Respondent claims that he did not receive the net proceeds in the
amount of ₱988,333.00 as stated in the Loan Release Sheet dated
September 23, 1983.31 The document, however, bears respondent’s
signature as borrower.32Res ipsa loquitur.33  The document speaks for
itself. Respondent has already impliedly admitted the genuineness
and due execution of the loan documents. No further proof is
necessary to show that he undertook the obligation with petitioner. "A
person cannot accept and reject the same instrument." 34
The Court also finds that petitioner’s claim is not barred by
prescription.
Petitioner’s action for collection of a sum of money was based on a
written contract and prescribes after ten years from the time its right
of action arose.35 The prescriptive period is interrupted when there is
a written extrajudicial demand by the creditors.36 The interruption of
the prescriptive period by written extrajudicial demand means that
the said period would commence anew from the receipt of the
demand.37
Thus, in the case of The Overseas Bank of Manila vs. Geraldez,38 the
Court categorically stated that the correct meaning of interruption as
distinguished from mere suspension or tolling of the prescriptive
period is that said period would commence anew from the receipt of
the demand. In said case, the respondents Valenton and Juan, on
February 16, 1966, obtained a credit accommodation from the
Overseas Bank of Manila in the amount of ₱150,000.00. Written
extrajudicial demands dated February 9, March 1 and 27, 1968,
November 13 and December 8, 1975 and February 7 and August 27,
1976 were made upon the respondents but they refused to pay.
When the bank filed a case for the recovery of said amount, the trial
court dismissed the same on the ground of prescription as the bank's
cause of action accrued on February 16, 1966 (the date of the
manager's check for ₱150,000.00 issued by the plaintiff bank to the
Republic Bank) and the complaint was filed only on October 22,
1976. Reversing the ruling of the trial court, the Court ruled:
An action upon a written contract must be brought within
ten years from the time the right of action accrues (Art.
1144[1], Civil Code). "The prescription of actions is
interrupted when they are filed before the court, when there
is a written extrajudicial demand by the creditors, and when
there is any written acknowledgment of the debt by the
debtor" (Art. 1155, Ibid, applied in Gonzalo Puyat & Sons,
Inc. vs. City of Manila, 117 Phil. 985, 993; Philippine
National Bank vs. Fernandez, L-20086, July 10, 1967, 20
SCRA 645, 648; Harden vs. Harden, L-22174, July 21,
1967, 20 SCRA 706, 711).
A written extrajudicial demand wipes out the period that
has already elapsed and starts anew the prescriptive
period. Giorgi says: "La interrupcion difiere de la
suspension porque borra el tiempo transcurrido
anteriormente y obliga a la prescripcion a comenzar de
nuevo" (9 Teoria de las Obligaciones, 2nd Ed., p. 222). "La
interrupcion . . . quita toda eficacia al tiempo pasado y abre
camino a un computo totalmente nuevo, que parte del
ultimo momento del acto interruptivo, precisamente, como
si en aquel momento y no antes hubiese nacido el credito"
(8 Giorgi, ibid pp. 390-2).
… addition, resolve the case and render judgment on the merits,
That same view as to the meaning of interruption was
adopted in Florendo vs. Organo, 90 Phil. 483, 488, where it
ruled that the interruption of the ten-year prescriptive period
through a judicial demand means that "the full period of
prescription commenced to run anew upon the cessation of
the suspension". "When prescription is interrupted by a
judicial demand, the full time for the prescription must be
reckoned from the cessation of the interruption" (Spring vs.
Barr, 120 So. 256 cited in 54 C.J.S. 293, note 27). That
rule was followed in Nator and Talon vs. CIR, 114 Phil.
661, Sagucio vs. Bulos, 115 Phil. 786 and Fulton Insurance
Co. vs. Manila Railroad Company, L-24263, November 18,
1967, 21 SCRA 974, 981.
… Respondent is ordered to pay One Million Pesos (₱1,000,000.00)
Interruption of the prescriptive period as meaning renewal
of the original term seems to be the basis of the ruling in
Ramos vs. Condez, L-22072, August 30, 1967, 20 SCRA
1146, 1151. In that case the cause of action accrued on
June 25, 1952. There was a written acknowledgment by
the vendors on November 10, 1956 of the validity of the
deed of sale.
…
In National Marketing Corporation vs. Marquez, L-25553, January 31,
1969, 26 SCRA 722, it appears that Gabino Marquez executed on
June 24, 1950 a promissory note wherein he bound himself to pay to
the Namarco ₱12,000 in installments within the one-year period
starting on June 24, 1951 and ending on June 25, 1952. After making
partial payments on July 7, 1951 and February 23, 1952, Marquez
defaulted.
His total obligation, including interest, as of October 31, 1964,
amounted to ₱19,990.91. Written demands for the payment of the
obligation were made upon Marquez and his surety on March 22,
1956, February 16, 1963, June 10, September 18 and October 13,
1964. Marquez did not make any further payment.
The Namarco sued Marquez and his surety on December 16, 1964.
They contended that the action had prescribed because the ten-year
period for suing on the note expired on June 25, 1962. That
contention was not sustained. It was held that the prescriptive period
was interrupted by the written demands, copies of which were
furnished the surety.
Respondent’s obligation under the promissory note became due and
demandable on October 13, 1983. On July 27, 1988, petitioner’s
counsel made a written demand for petitioner to settle his obligation.
From the time respondent’s obligation became due and demandable
on October 13, 1983, up to the time the demand was made, only 4
years, 9 months and 14 days had elapsed. The prescriptive period
then commenced anew when respondent received the demand letter
on August 5, 1988.39 Thus, when petitioner sent another demand
letter on February 22, 1994,40 the action still had not yet prescribed
as only 5 years, 6 months and 17 days had lapsed. While the records
do not show when respondent received the second demand letter,
nevertheless, it is still apparent that petitioner had the right to institute
the complaint on September 14, 1994, as it was filed before the lapse
of the ten-year prescriptive period.
Lastly, if a demurrer to evidence is granted but on appeal the order of
dismissal is reversed, the movant shall be deemed to have waived
the right to present evidence.41 The movant who presents a demurrer
to the plaintiff’s evidence retains the right to present their own
evidence, if the trial court disagrees with them; if the trial court
agrees with them, but on appeal, the appellate court disagrees with
both of them and reverses the dismissal order, the defendants lose
the right to present their own evidence. The appellate court shall, in
inasmuch as a demurrer aims to discourage prolonged
litigations.42 Thus, respondent may no longer offer proof to establish
that he has no liability under the loan documents sued upon by
petitioner.
The promissory note signed and admitted by respondent provides for
the loan amount of ₱1,000,000.00, to mature on October 13, 1983,
with interest at the rate of 25% per annum. The note also provides for
a penalty charge of 24% per annum of the amount due and unpaid,
and 25% attorney’s fees. Hence, respondent should be held liable for
these sums.
WHEREFORE, the petition is GRANTED. The Decisions of the
Regional Trial Court of Manila (Branch 37) dated January 26, 1996,
and the Court of Appeals dated October 27, 1999 are SET ASIDE.
plus 25% interest and 24% penalty charge per annum beginning
October 13, 1983 until fully paid, and 25% of the amount due as
attorney’s fees.
Costs against respondent.
SO ORDERED.
Puno, Callejo, Sr., Tinga,  and Chico-Nazario*, JJ., concur.
Footnotes
* On Leave.
1
 Records, p. 4, Annex "A."
2
 Id., p. 5, Annex "B."
3
 Id., p. 6, Annex "C."
4
 Id., p. 7, Annex "D."
5
 Id., p. 8, Annex "D-1."
6
 Id., p. 9, Annex "E."
7
 Id., p. 10, Annex "F."  Ledesma vs. Court of Appeals, G.R. No. 106646, June
37

30, 1993, 224 SCRA 175, 177-178.

8
 Id., p. 23.
38
 G.R. No. L-46541, December 28, 1979 (94 SCRA 937).
9
 Id., p. 27.
39
 Records, p. 8, Exhibit "D-1."
10
 Id., p. 61.
40
 Id., p. 9, Exhibit "E."
11
 Id., p. 4, Exhibit "A."
 FGU Insurance Corporation vs. G.P. Sarmiento Trucking
41

12
 Id., p. 5, Exhibit "B." Corporation, G.R. No. 141910, August 6, 2002, 386 SCRA
312, 322-323.
13
 Id., p. 6, Exhibit "C."
 Radiowealth Finance Company vs. Del Rosario, G.R. No.
42

138739, July 6, 2000, 335 SCRA 288, 297.

14
 Id., p. 87.

15
 Id., p. 106.

16
 Penned by Justice Roberto A. Barrios, concurred in by
Justices Godardo A. Jacinto and Mercedes Gozo-Dadole.

17
 CA Rollo, pp. 103-104.

18
 Id., pp. 102-103.

19
 Rollo, p. 32.

 New Sampaguita Builders Construction, Inc. vs.

20

Philippine National Bank, G.R. No. 148753, July 30, 2004.

 Philippine Lawin Bus Co. vs. Court of Appeals,  G.R. No.

21

130972, January 23, 2002, 374 SCRA 332, 337.

22
 Supra., New Sampaguita Builders Construction, Inc.
case, note 20.

23
 Records, pp. 105-106.

24
 CA Rollo, pp. 102-103.

25
 Records, p. 23.

26
 Id., p. 27.

27
 37 Phil. 254, 256 (1917).

 Filipinas Textile Mills vs. Court of Appeals, G.R. No.

28

119800, November 12, 2003.

 Velasquez vs. Court of Appeals, G.R. No. 124049, June

29

30, 1999, 309 SCRA 539, 547.

 Chua vs. Court of Appeals, G.R. No. 88383, February 19,

30

1992, 206 SCRA 339, 346.

31
 Records, p. 23.

32
 Id., p. 5, Exhibit "B-1."

 Associated Bank vs. Court of Appeals, G.R. No. 123793,

33

June 29, 1998, 291 SCRA 511, 527.

34
 Id., at page 528.

35
 Article 1144, Civil Code.

36
 Article 1155, Civil Code.