Module 3
Title 3 - Co-ownership(Arts. 484 - 501)
Art. 484. There is co-ownership whenever the ownership
of an undivided thing or right belongs to different persons.
In default of contracts, or of special provisions, co-
ownership shall be governed by the provisions of this
Title. (392)
Art. 485. The share of the co-owners, in the benefits as
well as in the charges, shall be proportional to their
respective interests. Any stipulation in a contract to the
contrary shall be void.
The portions belonging to the co-owners in the co-
ownership shall be presumed equal, unless the contrary
is proved. (393a)
Art. 486. Each co-owner may use the thing owned in
common, provided he does so in accordance with the
purpose for which it is intended and in such a way as not
to injure the interest of the co-ownership or prevent the
other co-owners from using it according to their rights. The
purpose of the co-ownership may be changed by
agreement, express or implied. (394a)
Art. 487. Any one of the co-owners may bring an action in
ejectment. (n)
Art. 488. Each co-owner shall have a right to compel the
other co-owners to contribute to the expenses of
preservation of the thing or right owned in common and to
the taxes. Any one of the latter may exempt himself from
this obligation by renouncing so much of his undivided
interest as may be equivalent to his share of the expenses
and taxes. No such waiver shall be made if it is prejudicial
to the co-ownership. (395a)
Art. 489. Repairs for preservation may be made at the will
of one of the co-owners, but he must, if practicable, first
notify his co-owners of the necessity for such repairs.
Expenses to improve or embellish the thing shall be
decided upon by a majority as determined in Article
492. (n)
Art. 490. Whenever the different stories of a house belong
to different owners, if the titles of ownership do not specify
the terms under which they should contribute to the
necessary expenses and there exists no agreement on
the subject, the following rules shall be observed:
(1) The main and party walls, the roof and the other things
used in common, shall be preserved at the expense of all
the owners in proportion to the value of the story
belonging to each;
(2) Each owner shall bear the cost of maintaining the floor
of his story; the floor of the entrance, front door, common
yard and sanitary works common to all, shall be
maintained at the expense of all the owners pro rata;
(3) The stairs from the entrance to the first story shall be
maintained at the expense of all the owners pro rata, with
the exception of the owner of the ground floor; the stairs
from the first to the second story shall be preserved at the
expense of all, except the owner of the ground floor and
the owner of the first story; and so on successively. (396)
Art. 491. None of the co-owners shall, without the consent
of the others, make alterations in the thing owned in
common, even though benefits for all would result
therefrom. However, if the withholding of the consent by
one or more of the co-owners is clearly prejudicial to the
common interest, the courts may afford adequate
relief. (397a)
Art. 492. For the administration and better enjoyment of
the thing owned in common, the resolutions of the majority
of the co-owners shall be binding.
There shall be no majority unless the resolution is
approved by the co-owners who represent the controlling
interest in the object of the co-ownership.
Should there be no majority, or should the resolution of
the majority be seriously prejudicial to those interested in
the property owned in common, the court, at the instance
of an interested party, shall order such measures as it
may deem proper, including the appointment of an
administrator.
Whenever a part of the thing belongs exclusively to one
of the co-owners, and the remainder is owned in common,
the preceding provision shall apply only to the part owned
in common. (398)
Art. 493. Each co-owner shall have the full ownership of
his part and of the fruits and benefits pertaining thereto,
and he may therefore alienate, assign or mortgage it, and
even substitute another person in its enjoyment, except
when personal rights are involved. But the effect of the
alienation or the mortgage, with respect to the co-owners,
shall be limited to the portion which may be alloted to him
in the division upon the termination of the co-
ownership. (399)
Art. 494. No co-owner shall be obliged to remain in the co-
ownership. Each co-owner may demand at any time the
partition of the thing owned in common, insofar as his
share is concerned.
Nevertheless, an agreement to keep the thing undivided
for a certain period of time, not exceeding ten years, shall
be valid. This term may be extended by a new agreement.
A donor or testator may prohibit partition for a period
which shall not exceed twenty years.
Neither shall there be any partition when it is prohibited by
law.
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No prescription shall run in favor of a co-owner or co-heir
against his co-owners or co-heirs so long as he expressly
or impliedly recognizes the co-ownership. (400a)
Art. 495. Notwithstanding the provisions of the preceding
article, the co-owners cannot demand a physical division
of the thing owned in common, when to do so would
render it unserviceable for the use for which it is intended.
But the co-ownership may be terminated in accordance
with
Article 498. (401a)
Art. 496. Partition may be made by agreement between
the parties or by judicial proceedings. Partition shall be
governed by the Rules of Court insofar as they are
consistent with this Code. (402)
Art. 497. The creditors or assignees of the co-owners may
take part in the division of the thing owned in common and
object to its being effected without their concurrence. But
they cannot impugn any partition already executed,
unless there has been fraud, or in case it was made
notwithstanding a formal opposition presented to prevent
it, without prejudice to the right of the debtor or assignor
to maintain its validity. (403)
Art. 498. Whenever the thing is essentially indivisible and
the co-owners cannot agree that it be allotted to one of
them who shall indemnify the others, it shall be sold and
its proceeds distributed. (404)
Art. 499. The partition of a thing owned in common shall
not prejudice third persons, who shall retain the rights of
mortgage, servitude or any other real rights belonging to
them before the division was made. Personal rights
pertaining to third persons against the co-ownership shall
also remain in force, notwithstanding the partition. (405)
Art. 500. Upon partition, there shall be a mutual
accounting for benefits received and reimbursements for
expenses made. Likewise, each co-owner shall pay for
damages caused by reason of his negligence or fraud. (n)
Art. 501. Every co-owner shall, after partition, be liable for
defects of title and quality of the portion assigned to each
of the other co-owners. (n)
A. Concept of Ownership
1. Requisites
a. There must be a plurality of owners
b. The object of ownership must be a thing
or right which is undivided
c. Each co-owner’s right must be limited
only to his ideal share of the physical
whole
2. Characteristics of Ownership
a) There are 2 or more co-owners
b) There is a single object which is not materially or
physically divided and over which and his ideal
share of the whole, each co-owner exercises
ownership, together with other co-owners
c) There is no mutual representation by the co-
owners
d) It exists for the common enjoyment of the co-
owners
e) It has no distinct legal personality
f) It is governed by by the contract of the parties
B. Rights of Each Co-owner
CASES:
DEL BANCO v. IAC
FACTS: In a document executed in the Municipality of
San Rafael, Bulacan, on February 11, 1859, three
brothers, Benedicto Pansacola, Jose Pansacola and
Manuel Pansacola (known as Fr. Manuel Pena) entered
into an agreement which provided, among others:
1. That tehy will purchase from the Spanish
Government the lands comprising the Islands of
Cagbalite located in the the Province of Tayabas
and has an approximate area of 1,600 hectares
2. That the lands shall be considered after the
purchase as their common property
3. That the co-ownership includes Domingo Arce
and Baldomera Angulo, minors at the time
represented by their father, Manuel Pansacola
who will contribute for them in the proposed
purchase of the Cagbalite Island
4. That whatever benefits may be derived from the
Isalnd shall be shared equally by the co-owners
in the following proportions:
a. ¼ to Benedicto Pansacola
b. ¼ to Jose Pansacola
c. 2/4 shares to Domingo Arce and Baldomera
Angulo
On April 11, 1868, they modified the terms and conditions
of the agreement:
a. (1/4) portion shall belong to Don Benedicto
Pansacola;
b. (1/4) portion shall belong to Don Jose Pansacola;
c. (1/4) portion shall henceforth belong to the
children of their deceased brother, Don Eustaquio
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Pansacola, namely: Don Mariano Pansacola,- Maria
Pansacola and Don Hipolito Pansacola;
d. (1/4) portion shall belong to their nephews and
nieces (1) Domingo Arce, (2) Baldomera Angulo, (3)
Marcelina Flores, (4) Francisca Flores, (5) Candelaria
dela Cruz, and (6) Gervasio Pansacola who, being all
minors, are still under the care of their brother, Manuel
Pansacola (Fr. Manuel Pena). The latter is the real father
of said minors.
About one hundred years later, on November 18, 1968,
private respondents brought a special action for partition
under the provisions of Rule 69 of the Rules of Court,
including as parties the heirs and successors-in-interest
of the co-owners of the Cagbalite Island.
The trial court rendered a decision dismissing the
complaint. But the CA reversed the decision.
ISSUES: Whether or not Cagbalite Island is still undivided
property owned in common by the heirs and successors-
in-interest of the brothers, Benedicto, Jose and Manuel
Pansacola.
Does prescription run in favor of a co-owner against his
co-owners or co-heirs so long as he expressly or impliedly
recognizes the co-ownership
HELD: YES. There is nothing in all four agreements that
suggests that actual or physical partition of the Island had
really been made by either the original owners or their
heirs or successors-in-interest. Although, some of the
private respondents and some of the petitioners at the
time the action for partition was filed in the trial court have
been in actual possession and enjoyment of several
portions of the property in question, this does not provide
any proof that the Island in question has already been
actually partitioned and co-ownership terminated. It is not
enough that the co-owners agree to subdivide the
property. They must have a subdivision plan drawn in
accordance with which they take actual and exclusive
possession of their respective portions in the plan and
titles issued to each of them accordingly. The mechanics
of actual partition should follow the procedure laid down
in Rule 69 of the Rules of Court.
NO. No prescription shall run in favor of a co-owner
against his co-owners or co-heirs so long as he expressly
or impliedly recognizes the co-ownership.Co-owners
cannot acquire by prescription the share of the other co-
owners, absent a clear repudiation of the co-ownership
clearly communicated to the other co-owners An action
for partition does not prescribe. Article 497 of the New
Civil Code, provides that “the assignees of the co-owners
may take part in the partition of the common property, and
Article 494 provides that “each co-owner may demand at
any time the partition of the common property, a provision
which implies that the action to demand partition is
imprescriptible or cannot be barred by laches” An action
for partition does not lie except when the co-ownership is
properly repudiated by the co- owner.
HEIRS OF REYNALDO DELA ROSA v.
BATONGBACAL
SUMMARY: Under co-ownership, a Contract to Sell
limited to a co-owner’s ideal share in the property held in
common is perfectly valid and binding. In fact, no authority
from the other co-owners is necessary for such
disposition to be valid as he is afforded by the law full
ownership of his part and of the fruits and benefits
pertaining thereto. A condition set forth in a sale contract
requiring a co-owner to secure an authority from his co-
owners for the alienation of his share, as seemingly
indicated in this case, should be considered mere
surplusage and does not, in any way, affect the validity or
the enforceability of the contract. Nor should such a
condition indicate an intention to sell the whole if the
contrary intention has been clearly written in the terms of
the contract.
Basic is the rule that if the terms of the contract are clear
and leave no doubt upon the intention of the parties, the
literal meaning of its stipulations shall control.
An equitable mortgage is defined as one although lacking
in some formality, or form or words, or other requisites
demanded by a statute, nevertheless reveals the intention
of the parties to charge real property as security for a debt,
and contains nothing impossible or contrary to law. For
the presumption of an equitable mortgage to arise, two
requisites must concur: (1) that the parties entered into a
contract denominated as a sale; and (2) the intention was
to secure an existing debt by way of mortgage.
FACTS: The subject property consists of a 3,750 square
meter-portion of the 15,000 square meters parcel of land
situated in Barrio Saog, Marilao, Bulacan under the
names of Reynaldo Dela Rosa (Reynaldo), Eduardo Dela
Rosa (Eduardo), Araceli Dela Rosa (Araceli) and Zenaida
Dela Rosa (Zenaida).
Sometime in 1984, Reynaldo offered to sell the subject
property to Guillermo Batongbacal and Mario
Batongbacal for ₱50.00 per square meter or for a total of
₱187,500.00. Pursuant to the agreement, Reynaldo
received an advance payment of ₱31,500.00 leaving a
balance of ₱156,000.00. On 18 February 1987, the
parties agreed that the amount of ₱20,000.00 as part of
the advance payment shall be paid upon the delivery of
the Special Power-of-Attorney (SPA), which would
authorize Reynaldo to alienate the subject property on
behalf of his co-owners and siblings namely, Eduardo,
Araceli and Zenaida. The balance thereon shall be paid in
₱10,000.00 monthly installments until the purchase price
is fully settled.
Subsequent to the execution of the said agreement, Mario
and Guillermo, on their own instance, initiated a survey to
segregate the area of 3,750 square meters from the whole
area covered, delineating the boundaries of the
subdivided parts. Mario and Guillermo thereafter made
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several demands from Reynaldo to deliver the SPA as
agreed upon, but such demands all went unheeded.
Consequently, Guillermo and Mario initiated an action for
Specific Performance or Rescission and Damages before
the RTC, seeking to enforce their Contract to Sell. In their
complaint, Mario and Guillermo asserted that they have a
better right over the subject property and alleged that the
subsequent sale effected by Reynaldo to third persons is
void as it was done in bad faith. It was prayed in the
Complaint that Reynaldo be directed to deliver the SPA
and, in case of its impossibility, to return the amount of
₱31,500.00 with legal interest and with damages in either
case. To protect their rights on the subject property,
Mario and Guillermo also filed a Notice of Lis Pendens
registering their claim on the certificate of title covering the
entire property.
Reynaldo countered that the purported Contract to Sell is
void, because he never gave his consent thereto.
Reynaldo insisted that he was made to understand that
the contract between him and the Batongbacals was
merely an equitable mortgage whereby it was agreed that
the latter will loan to him the amount of ₱31,500.00
payable once he receives his share in the proceeds of the
sale of the land registered.
The RTC dismissed the civil case of the Batongbacals,
but ordered Reynaldo to return the amount of P 28,000
plus interest. The CA, in its initial ruling, overturned the
RTC and brushed aside the claim of equitable mortgage
and held that the sale effected by Reynaldo of his
undivided share in the property is valid and enforceable.
According to the appellate court, no SPA is necessary for
Reynaldo's disposition of his undivided share as it is
limited to the portion that may be allotted to him upon the
termination of the co-ownership. The Batongbacals could
have validly demanded from Reynaldo to deliver the
subject property pursuant to the Contract to Sell but such
option is no longer feasible because the entire property
has already been sold to third persons to whom a new title
was issued. The appellate court thus proceeded to
rescind the contract and ordered Reynaldo to return the
amount he received as consideration thereby restoring
the parties to their situation before entering into the
agreement.
Upon MR by Guillermo and Mario, who pointed out that
the title of the subject property has not yet been
transferred to third persons and thus Reynaldo can still be
compelled to execute a deed of conveyance over his
undivided share of the entire property, the Court of
Appeals granted the motion and directed Reynaldo dela
Rosa or his successor-in-interest to execute the requisite
Deed of Sale over his undivided share in the subject
property and to accept the consideration of ₱156,000.00
within thirty (30) days from the finality of the decision. In
case of failure of Reynaldo to execute the deed of sale,
the Branch Clerk of Court of the RTC was directed to
execute the same and receive the ₱156,000.00 balance
on the purchase price on behalf of Reynaldo de la
Rosa. However, the death of Reynaldo intervened, and
so his heirs sought relief from the SC to reverse the CA’s
ruling on the ground that it was rendered not in
accordance with the applicable law and jurisprudence.
ISSUE(s) (1) Whether the agreement between Reynaldo
and the Batongbacals was a Contract to Sell or an
equitable mortgage: (2) Whether or not Reynaldo’s
agreement with Guillermo and Mario is enforceable
RATIO: An equitable mortgage is defined as one although
lacking in some formality, or form or words, or other
requisites demanded by a statute, nevertheless reveals
the intention of the parties to charge real property as
security for a debt, and contains nothing impossible or
contrary to law. For the presumption of an equitable
mortgage to arise, two requisites must concur: (1) that the
parties entered into a contract denominated as a sale; and
(2) the intention was to secure an existing debt by way of
mortgage. Consequently, the non-payment of the debt
when due gives the mortgagee the right to foreclose the
mortgage, sell the property and apply the proceeds of the
sale for the satisfaction of the loan obligation. While there
is no single test to determine whether the deed of absolute
sale on its face is really a simple loan accommodation
secured by a mortgage, the Civil Code, however,
enumerates several instances when a contract is
presumed to be an equitable mortgage, to wit:
Article 1602. The contract shall be presumed to be an
equitable mortgage, in any of the following cases:
1) When the price of a sale with right to repurchase is
unusually inadequate;
(2) When the vendor remains in possession as lessee or
otherwise;
(3) When upon or after the expiration of the right to
repurchase another instrument extending the period of
redemption or granting a new period is executed;
(4) When the purchaser retains for himself a part of the
purchase price;
(5) When the vendor binds himself to pay the taxes on the
thing sold;
(6) In any other case where it may be fairly inferred that
the real intention of the parties is that the transaction shall
secure the payment of a debt or the performance of any
other obligation.
In any of the foregoing cases, any money, fruits, or other
benefit to be received by the vendee as rent or otherwise
shall be considered as interest which shall be subject to
the usury laws.
A perusal of the contract denominated as Resibo reveals
nothing therein suggests, even remotely, that the subject
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property was given to secure a monetary obligation. The
terms of the contract set forth in no uncertain terms that
the instrument was executed with the intention of
transferring the ownership of the subject property to the
buyer in exchange for the price.
As a co-owner of the subject property, Reynaldo's right to
sell, assign or mortgage his ideal share in the property
held in common is sanctioned by law. The applicable law
is Article 493 NCC, which spells out the rights of co-
owners over a co-owned property, to wit:
Art. 493. Each co-owner shall have the full ownership of
his part and of the fruits and benefits pertaining thereto,
and he may therefore alienate, assign or mortgage it, and
even substitute another person in its enjoyment, except
when personal rights are involved. But the effect of the
alienation or the mortgage, with respect to the co-owners,
shall be limited to the portion which may be allotted to him
in the division upon the termination of the co-ownership.
Pursuant to this law, a co-owner has the right to alienate
his pro-indiviso share in the co-owned property even
without the consent of his co-owners. This right is
absolute and in accordance with the well-settled doctrine
that a co-owner has a full ownership of his pro-indiviso
share and has the right to alienate, assign or mortgage it,
and substitute another person for its enjoyment.
ARAMBULO v. NOLASCO
SUMMARY: There is a mother and her 8 children, who all
co-own a 233 sq. m. lot in Tondo (so each has a 1/9
share). When one of her daughters passed away, her
share was succeeded by her husband and 3 children (so
each owns 1/4 of her 1/9 share). The mother and the 7
children wanted to sell their respective shares, except for
the daughter’s family. They went to Court for adequate
relief under Art. 491, alleging that the respondents are
withholding their consent. RTC granted this, but CA
reversed, saying that the applicable rule is Article 493. SC
affirms CA’s decision.
DOCTRINE:
● The sale by the petitioners of their parts
shall not affect the full ownership by the
respondents of the part that belongs to them.
Their part which petitioners will sell shall be that
which may be apportioned to them in the division
upon the termination of the co-ownership. With
the full ownership of the respondents remaining
unaffected by petitioners’ sale of their parts, the
nature of the property, as co-owned, likewise
stays.
● A sale of the entire property by one co-
owner without the consent of the other co-owners
is not null and void. However, only the rights of
the co-owner-seller are transferred, thereby
making the buyer a co-owner of the property.
RELEVANT PROVISIONS:
● Article 491, CC: None of the co-owners
shall, without the consent of the others, make
alterations in the thing owned in common, even
though benefits for all would result therefrom.
However, if the withholding of the consent by one
or more of the co-owners is clearly prejudicial to
the common interest, the courts may afford
adequate relief. (397a)
● Article 493, CC. Each co-owner shall have
the full ownership of his part and of the fruits and
benefits pertaining thereto, and he may therefore
alienate, assign or mortgage it, and even
substitute another person in its enjoyment, except
when personal rights are involved. But the effect
of the alienation or the mortgage, with respect to
the co-owners, shall be limited to the portion
which may be allotted to him in the division upon
the termination of the co-ownership.
● Article 494, CC no co-owner shall be
obliged to remain in the co-ownership, and that
each co-owner may demand at any time partition
of the thing owned in common insofar as his
share is concerned.
● Article 498, CC whenever the thing is
essentially indivisible and the co-owners cannot
agree that it be allotted to one of them who shall
indemnify the others, it shall be sold and its
proceeds accordingly distributed
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FACTS:
Petitioners [Raul V. Arambulo and Teresita A. Dela Cruz,
along with their mother Rosita Vda. De Arambulo, and
siblings Primo V. Arambulo, Ma. Lorenza A. Lopez, Ana
Maria V. Arambulo, Maximiano V. Arambulo, Julio V.
Arambulo and Iraida Arambulo Nolasco (Iraida)] are co-
owners of two (2) parcels of land located in Tondo, Manila,
with an aggregate size of 233 square meters.
When Iraida passed away, she was succeeded by her
husband, respondent Genaro Nolasco and their children,
Iris Abegail Nolasco, Ingrid Aileen Arambulo and
respondent Jeremy Spencer Nolasco.
January 8, 1999: Petitioners filed a petition for relief
under Article 491 of the Civil Code with the RTC of
Manila, alleging that:
(1) all of the co-owners, except for respondents,
have authorized petitioners to sell their respective
shares to the subject properties;
(2) that only respondents are withholding their
consent to the sale of their shares;
(3) that in case the sale pushes through, their
mother and siblings will get their respective 1/9
share of the proceeds of the sale, while
respondents will get 1/4 share each of the 1/9
share of Iraida;
(4) that the sale of subject properties constitutes
alteration; and
(5) that under Article 491 of the Civil Code, if one
or more co-owners shall withhold their consent to
the alterations in the thing owned in common, the
courts may afford adequate relief.
In their Answer, respondents sought the dismissal of the
petition for being premature. Respondents averred that
they were not aware of the intention of petitioners to sell
the properties they co-owned because they were not
called to participate in any negotiations regarding the
disposition of the property.
September 19, 2002: RTC ruled in favor of petitioners and
ordered respondents to give their consent to the sale.
They found that respondents’ withholding of their consent
to the sale is prejudicial to the common interest of the co-
owners.
October 7, 2008: CA granted the appeal and reversed
RTC. They held that the respondents had the full
ownership of their undivided interest in the subject
properties, thus, they cannot be compelled to sell their
undivided shares in the properties. It referred to the
provisions of Article 493 of the Civil Code. However, CA
also observed that petitioners failed to show how
respondents’ withholding of their consent would prejudice
the common interest over the subject properties. Hence,
the instant petition.
Petitioners’ Arguments:
Under Article 491, they may ask the court to afford them
adequate relief should respondents refuse to sell their
respective shares to the co-owned properties.
They refute the appellate court’s finding that they failed to
show how the withholding of consent by respondents
becomes prejudicial to their common interest.
They assert that one of the two subject properties has an
area of 122 sq. m. and if they decide to partition, instead
of selling the same, their share would be reduced to a
measly 30 sq. m. lot each.
The other property was testified to as measuring only 111
sq. m.
Petitioners reiterate that all the other co-owners are willing
to sell the property and give their share of the proceeds of
the sale.
ISSUE: W/N respondents, as co-owners, can be
compelled by the court to give their consent to the sale of
their shares in the co-owned properties.
HOLDING/RATIONALE: NO.
SC: First, the issue has to be removed out of the coverage
of Article 491.
● It does not apply to the problem arising out of the
proposed sale of the property co-owned by the parties in
this case.
● CA correctly applied the provision of Article 493 of
the Civil Code.
● The very initiatory pleading below was captioned
Petition For Relief Under Article 491 of the New Civil
Code.
● Petitioners filed the case on the submission that
Article 491 covers the petition and grants the relief prayed
for, which is to compel the respondent co-owners to agree
to the sale of the co-owned property.
● That a sale constitutes an alteration as mentioned
in Article 491 is an established jurisprudence.
o Alterations include any act of strict dominion or
ownership and any encumbrance or disposition has been
held implicitly to be an act of alteration. Alienation of the
thing by sale of the property is an act of strict dominion.
● However, the ruling that alienation is alteration does
not mean that a sale of commonly owned real property is
covered by Article 491, such that if a co- owner withholds
consent to the sale, the courts, upon a showing of a clear
prejudice to the common interest, may, as adequate relief,
order the grant of the withheld consent.
SC: CA’s reversal of RTC, correctly relying on Article 493,
is affirmed.
● There is co-ownership whenever, as in this case,
the ownership of an undivided thing, belongs to different
persons.
o Article 493 of the Code defines the ownership of
the co-owner, clearly establishing that each co-owner
shall have full ownership of his part and of its fruits and
benefits.
o Their part which petitioners will sell shall be that
which may be apportioned to them in the division upon the
termination of the co-ownership.
o With the full ownership of the respondents
remaining unaffected by petitioners’ sale of their parts, the
nature of the property, as co-owned, likewise stays.
o In lieu of the petitioners, their vendees shall be
co-owners with the respondents. The text of Article 493
says so.
● As early as 1923, this Court has ruled that even if
a co-owner sells the whole property as his, the sale will
affect only his own share but not those of the other co-
owners who did not consent to the sale.
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o The sale or other disposition affects only his
undivided share and the transferee gets only what would
correspond to his grantor in the partition of the thing
owned in common.
o From the foregoing, it may be deduced that since
a co-owner is entitled to sell his undivided share, a sale of
the entire property by one co-owner without the consent
of the other co-owners is not null and void.
o However, only the rights of the co-owner-seller
are transferred, thereby making the buyer a co-owner of
the property.
● The ultimate authorities in civil law, recognized as
such by the Court, agree that co-owners such as
respondents have over their part, the right of full and
absolute ownership.
o Such right is the same as that of individual owners
which is not diminished by the fact that the entire property
is co- owned with others.
o That part which ideally belongs to them, or their
mental portion, may be disposed of as they please,
independent of the decision of their co-owners.
o Insofar as the sale of co-owned properties is
concerned, there is no common interest that may be
prejudiced should one or more of the co-owners refuse to
sell the co-owned property, which is exactly the factual
situation in this case.
o When respondents disagreed to the sale, they
merely asserted their individual ownership rights. Without
unanimity, there is no common interest.
● Petitioners who project themselves as prejudiced
co-owners may bring a suit for partition, which is one of
the modes of extinguishing co-ownership with respect to
Article 494 and Article 498.
The petition is DENIED without prejudice to the filing of an
action for partition. The CA Decision is AFFIRMED.
QUINTOS v. NICOLAS
FACTS: Petitioners Vilma Quintos, Florencia Dancel, and
Catalino Ibarra, and respondents Pelagia Nicolas, Noli
Ibarra, Santiago Ibarra, Pedro Ibarra, David Ibarra,
Gilberto Ibarra, and the late Augusto Ibarra are siblings.
Their parents, Bienvenido and Escolastica Ibarra, were
the owners of the subject property, a 281 sqm. parcel of
land situated along Quezon Ave., Poblacion C, Camiling,
Tarlac, covered by TCT No. 318717.
The deceased parents left their 10 children ownership
over the subject property. In 2002, respondent siblings
brought an action for partition against petitioners. The
case was docketed as Civil Case No. 02-52 and was
raffled to the RTC at Camiling, Tarlac but was later on
dismissed as neither of the parties appeared and
appealed.
Respondent siblings instead resorted to executing a Deed
of Adjudication to transfer the property in favor of the 10
siblings. As a result, TCT No. 318717 was canceled and
TCT No. 390484 was issued in the names of the 10 heirs
of the Ibarra spouses. The siblings sold their 7/10
undivided share over the property in favor of their co-
respondents, the spouses Recto and Rosemarie
Candelario by virtue of a Deed of Absolute Sale and
Agreement of Subdivision, and the title was partially
cancelled as a result.
Petitioners filed a complaint for Quieting of Title and
Damages against respondents wherein they alleged that
during their parents’ lifetime, the couple distributed their
real and personal properties in favor of their 10 children.
Upon distribution, petitioners alleged that they received
the subject property and the house constructed thereon
as their share. They had been in adverse, open,
continuous, and uninterrupted possession of the property
for over 4 decades and are allegedly entitled to equitable
title. Participation in the execution of the aforementioned
Deeds was denied.
Respondents, on the other hand, countered that
petitioners’ cause of action was already barred by
estoppel when in 2006, one of petitioners offered to buy
the 7/10 undivided share, which is an admission
petitioners’ part that the property is not entirely theirs. The
Ibarras allegedly mortgaged the property but because of
financial constraints, respondent spouses Candelario had
to redeem the property. Not having been repaid, the
Candelarios accepted their share in the subject property
as payment. Lastly, respondents sought, by way of
counterclaim, the partition of the property.
RTC: dismissed petitioners’ complaint, as it did not find
merit in petitioners’ asseverations that they have acquired
title over the property through acquisitive prescription and
noted there was no document evidencing that their
parents bequeathed the property. Subsequent transfer of
the siblings’ interest in favor of respondent spouses
Candelario was upheld.
7
CA: upheld lower court decision and held that since the
property is co-owned by the plaintiffs- appellants, ( 3/10
undivided interest) and defendants-appellees Spouses
Candelarios (7/10 undivided interest) and considering that
plaintiffs-appellants had already constructed a 3-storey
building at the back portion of the property, partition is in
order, in accord with the subdivision plan.
ISSUES:
1. Whether or not the petitioners were able to prove
ownership over the property;
2. Whether or not the respondents’ counterclaim for
partition is already barred by laches or res judicata; and
3. Whether or not the CA was correct in approving the
subdivision agreement as basis for the partition of the
property.
HELD: Petitioners were not able to prove equitable title or
ownership over the property. Quieting of title is a common
law remedy for the removal of any cloud, doubt, or
uncertainty affecting title to real property.
For an action to quiet title to prosper, two indispensable
requisites must concur, namely:
(1) the plaintiff or complainant has a legal or equitable title
to or interest in the real property subject of the action; and
(2) the deed, claim, encumbrance, or proceeding claimed
to be casting cloud on the title must be shown to be in fact
invalid or inoperative despite its prima facie appearance
of validity or efficacy.
In the case at bar, the CA correctly observed that
petitioners’ cause of action must necessarily fail mainly in
view of the absence of the first requisite.
At the outset, it must be emphasized that the
determination of whether or not petitioners sufficiently
proved their claim of ownership or equitable title is
substantially a factual issue that is generally improper for
Us to delve into.In any event, a perusal of the records
would readily show that petitioners, as aptly observed by
the courts below, indeed, failed to substantiate their claim.
Their alleged open, continuous, exclusive, and
uninterrupted possession of the subject property is belied
by the fact that respondent siblings, in 2005, entered into
a Contract of Lease with the Avico Lending Investor Co.
over the subject lot without any objection from the
petitioners. Petitioners’ inability to offer evidence tending
to prove that Bienvenido and Escolastica Ibarra
transferred the ownership over the property in favor of
petitioners is likewise fatal to the latter’s claim.
The cardinal rule is that bare allegation of title does not
suffice. The burden of proof is on the plaintiff to establish
his or her case by preponderance of evidence.
Regrettably, petitioners failed to discharge the said
burden. There is no reason to disturb the finding of the
RTC that all 10 siblings inherited the subject property from
Bienvenido and Escolastica Ibarra, and after the
respondent siblings sold their aliquot share to the spouses
Candelario, petitioners and respondent spouses became
co-owners of the same.
The counterclaim for partition is not barred by prior
judgment.
As to the issue of partition as raised by respondents in
their counterclaim, the petitioners countered that the
action for partition has already been barred by res
judicata.
The Court had the occasion to rule that dismissal with
prejudice satisfies one of the elements of res judicata. It
is understandable why petitioners would allege res
judicata to bolster their claim. However, dismissal with
prejudice under Rule 17, Sec. 3 of the Rules of Court
cannot defeat the right of a co-owner to ask for partition
at any time, provided that there is no actual adjudication
of ownership of shares yet. This is pertinent to Article 494
of the Civil Code which discusses how the law generally
does not favor the retention of co-ownership as a property
relation, and is interested instead in ascertaining the co-
owners’ specific shares so as to prevent the allocation of
portions to remain perpetually in limbo. Thus, the law
provides that each co-owner may demand at any time the
partition of the thing owned in common.
Between dismissal with prejudice under Rule 17, Sec. 3
and the right granted to co-owners under Art. 494 of the
Civil Code, the latter must prevail. To construe otherwise
would diminish the substantive right of a co-owner
through the promulgation of procedural rules. Such a
construction is not sanctioned by the principle, which is
too well settled to require citation, that a substantive law
cannot be amended by a procedural rule. Art. 494 is an
exception to Rule 17, Sec. 3 of the Rules of Court to the
effect that even if the order of dismissal for failure to
prosecute is silent on whether or not it is with prejudice, it
shall be deemed to be without prejudice.
This is not to say, however, that the action for partition will
never be barred by res judicata. There can still be res
judicata in partition cases concerning the same parties
and the same subject matter once the respective shares
of the co-owners have been determined with finality by a
competent court with jurisdiction or if the court determines
that partition is improper for co- ownership does not or no
longer exists.
The counterclaim for partition is not barred by laches. We
now proceed to petitioners’ second line of attack.
According to petitioners, the claim for partition is already
barred by laches since by 1999, both Bienvenido and
Escolastica Ibarra had already died and yet the
respondent siblings only belatedly filed the action for
partition, Civil Case No. 02-52, in 2002. And since laches
has allegedly already set in against respondent siblings,
so too should respondent spouses Candelario be barred
from claiming the same for they could not have acquired
a better right than their predecessors-in-interest.
Laches is the failure or neglect, for an unreasonable and
unexplained length of time, to do that which––by the
exercise of due diligence––could or should have been
done earlier. It is the negligence or omission to assert a
right within a reasonable period, warranting the
presumption that the party entitled to assert it has either
abandoned or declined to assert it. The principle is a
creation of equity which, as such, is applied not really to
penalize neglect or sleeping upon one’s right, but rather
to avoid recognizing a right when to do so would result in
a clearly inequitable situation. As an equitable defense,
8
laches does not concern itself with the character of the
petitioners’ title, but only with whether or not by reason of
the respondents’ long inaction or inexcusable neglect,
they should be barred from asserting this claim at all,
because to allow them to do so would be inequitable and
unjust to petitioners.
As correctly appreciated by the lower courts, respondents
cannot be said to have neglected to assert their right over
the subject property. They cannot be considered to have
abandoned their right given that they filed an action for
partition. The fact that respondent siblings entered into a
Contract of Lease with Avico Lending Investor Co. over
the subject property is evidence that they are exercising
rights of ownership over the same.
The CA erred in approving the Agreement for Subdivision.
There is merit, however, in petitioners’ contention that the
CA erred in approving the proposal for partition submitted
by respondent spouses. Art. 496, as earlier cited,
provides that partition shall either be by agreement of the
parties or in accordance with the Rules of Court. In this
case, the Agreement of Subdivision allegedly executed by
respondent spouses Candelario and petitioners cannot
serve as basis for partition for respondents admitted that
the agreement was a falsity and that petitioners never
took part in preparing the same. The "agreement" was
crafted without any consultation whatsoever or any
attempt to arrive at mutually acceptable terms with
petitioners. It, therefore, lacked the essential requisite of
consent. Thus, to approve the agreement in spite of this
fact would be tantamount to allowing respondent spouses
to divide unilaterally the property among the co-owners
based on their own whims and caprices.
APIQUE v. FAHNESTICH
Doctrine: A joint bank account is one that is held jointly
by two or more natural persons, or by two or more juridical
persons or entities. Under such setup, the depositors are
joint owners or co-owners of the said account, and their
share in deposits shall be presumed equal,unless the
contrary is disproved.
Facts: The parties to the case are siblings. Respondent
Evangeline then left the country to work abroad.
Evangeline executed General and Special Powers of
Attorney constituting Dominador as her attorney-in-fact to
purchase real property for her, and to manage or
supervise herbusiness affair in the Philippines. Because
of such, they opened a joint account at EPCIB.
Dominador then withdrew the amount of ₱980,000.00
from the subject account and, thereafter, deposited the
money to his own savings account with the same bank.
This prompted Evangeline to demand for the return of the
amount, but to no avail. Evangeline then filed a case
against Dominador impleading EPCI Basa Party
Defendant.
In his answer, Dominador asserted, among others, that
he was authorized to withdraw funds from the subject
account to answerforth expenses of Evangeline's
projects, considering:
(a)that it was a joint account, and
(b)the general and special powers of attorney executed
by Evangeline hisfavor.
ISSUE: Whether Or Not Dominador may validly withdraw
from the joint account without the prior consent of
Evangeline.
Ruling: Yes, Dominador may validly withdraw from the
joint account without Evangeline’s consent.
A joint account is one that is held jointly by two or more
natural persons or by two or more juridical persons or
entities. Under such setup,the depositors are joint owners
or co-owners of the said account, and their share in the
deposits shall be presumed equal, unless the contrary is
proved, pursuant to Article 485 of the CivilCode.
The common banking practice is that regardless of who
puts the money into the account, each of the named
account holders has an undivided right to the entire
balance, and any of them deposit and/or withdraw,
partially or wholly, the funds without the need or consent
of the other, during their lifetime. Nevertheless, as
between the account holders, their right against each
other depends on what they have agreed upon, and the
purpose for which the account was opened and how it will
be operated.
9
Since Evangeline and Dominador entered into a joint
account, Dominador is a co-owner of the subject account
as far as the bank is concerned – and may, thus,validly
deposit and/or withdraw funds without the consent of his
co-depositor - Evangeline - as between him and
Evangeline, his authority to withdraw, as well as the
amount to be withdrawn, is circumscribed by the purpose
of which the subject account was opened.
However, Dominador’s right to obtain funds from the
subject account was conditioned on the necessity of funds
for Evangeline’s projects. Admittedly, at the time he
withdrew the amount of P980,000 from the subject
account, there was no project being undertaken for
Evangeline. Therefore, Dominador must return the same
to Evangeline.
CATEDRILLA v. LAURON
Facts: On February 12, 2003, petitioner Rey
CastigadorCatedrilla filed with the Municipal Trial
Court (MTC) of Lambunao, Iloilo a Complaint for
ejectment against the spouses Mario and Margie Lauron
on the subject lot owned by Lilia, the petitioner's mother.
Sometime in 1980, respondents Mario and Margie
Lauron, through the tolerance of the heirs of Lilia,
constructed a residential building of strong materials on
the northwest portion of the lot covering an area of one
hundred square meters; that the heirs of Lilia made
various demands for respondents to vacate the premises
and even exerted earnest efforts to compromise with
them but the same was unavailing and the petitioner
reiterated the demand on respondents to vacate the
subject lot on January 15, 2003, but respondents
continued to unlawfully withhold such possession.
In their Answer, respondents claimed that petitioner had
no cause of action against them, since they are not the
owners of the residential building standing on petitioner's
lot, but Mildred Kascher (Mildred), sister of respondent
Margie, as shown by the tax declaration in Mildred's
name.
On November 14, 2003, the MTC rendered its Decision in
favor of the plaintiff. Based on the allegations and
evidence presented, it appeared that petitioner is one of
the heirs of Lilia CastigadorCatedrilla, the owner of the
subject lot and that respondents are occupying the
subject lot; that petitioner is a party who may bring the suit
in accordance with Article 487 of the Civil Code; and as a
co-owner, petitioner is allowed to bring this action for
ejectment under Section 1, Rule 70 of the Rules of Court;
that respondents are also the proper party to be sued as
they are the occupants of the subject lot which they do not
own.
Respondents filed their appeal with the Regional Trial
Court (RTC) of Iloilo City, which rendered its Order and
affirmed the decision of MTC.
The CA issued its decision reversing and setting aside the
decision of the RTC.The CA found that only petitioner filed
the case for ejectment against respondents and ruled that
the other heirs should have been impleaded as plaintiffs
citing Section 1, Rule 7 and Section 7, Rule 3 of
the Rules of Court; that the presence of all
indispensable parties is a condition sine qua non for the
exercise of judicial power; that when an indispensable
party is not before the court, the action should be
dismissed as without the presence of all the other heirs as
plaintiffs, the trial court could not validly render judgment
and grant relief in favor of the respondents.
Issue: Whether Petitioner can file the action without
impleading his co-owners.
Held/Ratio: Yes.
10
Petitioner can file the action for ejectment without
impleading his co-owners. In Wee v. De Castro, wherein
petitioner therein argued that the respondent cannot
maintain an action for ejectment against him, without
joining all his co-owners, we ruled in this wise:
Article 487 of the New Civil Code is explicit on this point:
ART. 487. Any one of the co-owners may bring an action
in ejectment. —
of Appeals are hereby REVERSED and SET ASIDE. The
Order dated March 22, 2005 of the Regional Trial Court,
Branch 26, Iloilo City, in Civil Case No. 04-27978, is
hereby REINSTATED.
SO ORDERED.
Velasco, Jr., Abad, Mendoza and Leonen, JJ., concur.

This article covers all kinds of action for the recovery of

possession, i.e., forcible entry and unlawful detainer
(accioninterdictal), recovery of possession
(accionpubliciana), and recovery of ownership (accion de
reivindicacion). As explained by the renowned civilest,
Professor Arturo M. Tolentino:

A co-owner may bring such an action, without the

necessity of joining all the other co-owners as co-
plaintiffs, because the suit is deemed to be
instituted for the benefit of all. If the action is for the
benefit of the plaintiff alone, such that he claims
possession for himself and not for the co-
ownership, the action will not prosper.

In the more recent case of Carandang v. Heirs of De

Guzman, this Court declared that a co-owner is not even
a necessary party to an action for ejectment, for complete
relief can be afforded even in his absence, thus:

In sum, in suits to recover properties, all co-owners

are real parties in interest. However, pursuant to
Article 487 of the Civil Code and the relevant
jurisprudence, any one of them may bring an
action, any kind of action for the recovery of co-
owned properties. Therefore only one of the co-
owners, namely the co-owner who filed the suit for
the recovery of the co-owned property, is an
indispensable party thereto. The other co-owners
are not indispensable parties. They are not even
necessary parties, for a complete relief can be
afforded in the suit even without their participation,
since the suit is presumed to have been filed for the
benefit of all co-owners.

In this case, although petitioner alone filed the complaint

for unlawful detainer, he stated in the complaint that he is
one of the heirs of the late Lilia Castigador, his mother,
who inherited the subject lot, from her parents. Petitioner
did not claim exclusive ownership of the subject lot, but
he filed the complaint for the purpose of recovering its
possession which would redound to the benefit of the co-
owners. Since petitioner recognized the existence of a co-
ownership, he, as a co-owner, can bring the action without
the necessity of joining all the other co-owners as co-
plaintiffs.

WHEREFORE, premises considered, the petition is

hereby GRANTED. The Decision dated February 28,
2007 and the Resolution dated July 11, 2007 of the Court
11
CLEMENTE v. REPUBLIC
Facts: Municipal Mayor Amado A. Clemente (Mayor
Clemente), Dr. Vicente A. Clemente, Judge Ramon A.
Clemente, and Milagros A. Clemente (Clemente Siblings)
were the owners of a parcel of land. During their lifetime,
they executed a Deed of Donation... in favor of the
Republic
In the same Deed of Donation, District Engineer...
accepted. In accordance with the Deed of Donation, the
construction of a building for a hospital was started in the
following year. However, for reasons unknown, the
construction was never completed and only its foundation
remains today.
Socorro and Rosario P. Clemente wrote to the District
Engineer of Quezon asking for information on the
development of the government hospital
The District Engineer informed her that the DPWH no
longer had a plan to construct a hospital at the site and
that the DPWH had no budget for the hospital
construction. almost forty-one (41) years after the Deed of
Donation was executed, Socorro, as heir and successor-
in-interest of Mayor Clemente, filed a Complaint... for
Revocation of Donation, Reconveyance and Recovery of
Possession alleging that the Republic of the Philippines
failed to comply with the condition imposed on the Deed
of Donation, which was to use the property "solely for
hospital site only and for no other else, where a
[government [h]ospital shall be constructed.
RTC rendered its Decision[13] dismissing the case on the
ground of prematurity.
The RTC held that since the parties did not fix the period
within which to comply with the condition, but a period was
indeed intended, the Court may fix the period for the
performance of the donee's obligation, under Article 1197
of the Civil Code. However, since Socorro failed to pray
for the fixing of the period, the RTC dismissed the case.
CA denied the appeal, finding that while there may be
basis for the recovery of the property, Socorro, as an heir
of a deceased co-donor, cannot assert the concept of
heirship to participate in the revocation of the property
donated by her successor-in-interest.
Petitioner also argues that there is no need for a
settlement of the estate before an action for revocation of
donation, reconveyance, and recovery of possession of
property may be filed by an heir of a co-owner.
The last issue raised by the petitioner is whether the
action is premature, or if it has been barred by prescription
or laches. Respondent argues that the action has already
been prescribed because it has been more than ten (10)
years since the violation of the condition in the Deed of
Donation.
Issues: WHETHER OR NOT THE "SETTLEMENT OF
AN ESTATE" OR THE OF THE CO-OWNERS IS A
NECESSARY REQUIREMENT BEFORE THE
PETITIONER (THE ONLY SURVIVING SPOUSE OF
ONE OF THE CO-OWNERS) MAY FILE THIS ACTION
FOR REVOCATION OF DONATION, RECONVEYANCE
AND RECOVERY OF POSSESSION OF THE
PROPERTY WHICH THEY DONATED ON MARCH 16,
1963 OR 52 YEARS AGO, SINCE ANYWAY THE
ACTION SHALL INDISPUTABLY BENEFIT ALL CO-
HEIRS?
Ruling:
Because the condition in the Deed of Donation is a
resolutory condition, until the donation is revoked, it
remains valid. However, for the donation to remain valid,
the donee must comply with its obligation to construct a
government hospital and use the Subject Property as a
hospital site. The failure to do so gives the donor the right
to revoke the donation.
It is clear from the records that the donee failed to comply
with its obligation to construct a government hospital and
to use the premises as a hospital site.
When the parties provided in the Deed of Donation that
the donee should construct a government hospital, their
intention was to have such hospital built and completed,
and to have a functioning hospital on the Subject
Property.
The condition imposed upon the donee has two parts –
first, to construct a government hospital, and second, to
use the Subject Property solely as a hospital site.
A foundation of a building is obviously not a government
hospital. The other condition in the Deed of Donation,
which is to use the Subject Property solely as a hospital
site, is also not complied with when the Subject Property
is left idle
We agree
It has been settled that a co-heir or co-owner may bring
suit without impleading all the other co-owners if the suit
is for the benefit of all.
In this case, it is not disputed that Socorro is an heir of
one of the donors. Moreover, her prayer in her action was
to revoke the Deed of Donation and to cancel the TCT
issued in the name of the Province of Quezon, and to
issue a new certificate in the names of the heirs of the
Clemente Siblings, pro-indiviso, and to direct the Republic
to surrender or reconvey possession over the property to
the heirs of the Clemente Siblings.[26] It is clear,
therefore, that Socorro acknowledges and continues to
recognize her co-heirs as co-owners of the Subject
Property. Further, based on the Complaint and Amended
Complaint of Socorro, it is clear that the suit was intended
for the benefit of all the co-heirs of the Clemente Siblings.
Thus, there is no need to implead the other co-heirs for
the action to proceed as it is for the benefit of the co-
ownership.
Moreover, there is no need for the settlement of the estate
before one of the heirs can institute an action on behalf of
the other co-heirs. Although an heir's right in the estate of
the decedent which has not been fully settled and
partitioned is merely inchoate, Article 493 of the Civil
Code[27] gives the heir the right to exercise acts of
ownership.[28] Thus, even before the settlement of the
estate, an heir may file an action for reconveyance of
possession as a co-owner thereof, provided that such heir
recognizes and acknowledges the other co-heirs as co-
owners of the property as it will be assumed that the heir
is acting on behalf of all the co-heirs for the benefit of the
co-ownership.
12
We find that this action is not premature, and has not been the Subject Property solely for hospital purposes. Upon
barred by prescription or laches. the non-fulfillment of the condition, the donation may be
It is imperative to determine the period within which the revoked and all the rights already acquired by the donee
donee has to comply with the condition to construct a shall be deemed lost and extinguished.[18] This is a
government hospital and use the site solely as a hospital resolutory condition because it is demandable at once by
site, because it is only after such time that it can be the done[19] but the non-fulfillment of the condition gives
determined with certainty that there was a failure to the donor the right to revoke the donation.
comply with the condition. [T]he law now allows a co-owner to bring an action for
Based on the Deed of Donation, however, it is apparent ejectment, which covers all kinds of actions for the
that a period was indeed intended by the parties. recovery of possession, including forcible entry and
The construction of the said hospital could not have been unlawful detainer, without the necessity of joining all the
intended by the parties to be in a state of limbo as it can other co-owners as co-plaintiffs, because the suit is
be deduced that the parties intended that the hospital deemed to be instituted for the benefit of all
should be built within a reasonable period, although the Court has consistently held that as long as the co-owner
Deed of Donation failed to fix a period for such recognizes the co-ownership, there is no need to implead
construction. all the co-owners in all kinds of action for recovery of
While ideally, a period to comply with the condition should possession.
have been fixed by the Court, we find that this will be an An action for reconveyance based on a violation of a
exercise in futility because of of the fact that it has been condition in a Deed of Donation should be instituted within
more than fifty (50) years since the Deed of Donation has ten (10) years from the time of such violation.[29]
been executed; and thus, the reasonable time Moreover, an action to revoke a donation based on non-
contemplated by the parties within which to comply with compliance of the condition prescribes after four (4) years
the condition has already lapsed. from such non-compliance. Thus, in both cases, to be
there is no more need to fix the duration of a term of the able to determine whether the action has been
obligation when such procedure would be a mere prescribed, the time of non-compliance must first be
technicality and formality and would serve no purpose determined. This is because the failure to comply with the
than to delay or lead to an unnecessary and expensive condition imposed will give rise to the cause of action
multiplication of suits. Moreover, under Art. 1191 of the against the obligor-donee, which is also the starting point
Civil Code, when one of the obligors cannot comply with of when to count the prescriptive period.
what is incumbent upon him, the obligee may seek
rescission and the court shall decree the same unless
there is just cause authorizing the fixing of a period.
DPWH informed her that there were no plans to build any
hospital on the Subject Property. Thus, it is clear that the
donee no longer has the intention of fulfilling its obligation
under the Deed of Donation. It has now become evident
that the donee will no longer comply with the condition to
construct a hospital because a government hospital was
already built in another barangay
For the same reason, we find that laches have not set in.
Because of the failure of the Deed of Donation to specify
the period within which to comply with the condition, there
can be no delay in asserting the right against respondent.
In contrast, the respondent is guilty of unreasonable delay
and neglect in complying with its obligation to construct a
government hospital and to use the Subject Property as a
hospital site.
WHEREFORE, the petition is GRANTED. The 17 October
2014 Decision and the 14 August 2015 Resolution of the
Court of Appeals in CA-G.R. CV No. 91522 are hereby
REVERSED and SET ASIDE. The Regional Trial Court of
Mauban, Quezon, Branch 64, is ORDERED to cause the
cancellation by the Register of Deeds of Quezon of TCT
No. T-51745 and the issuance, in lieu thereof, of the
corresponding certificate of title in the name of the heirs
of Amado A. Clemente, Dr. Vicente A. Clemente, Judge
Ramon A. Clemente, and Milagros A. Clemente.
Principles:
The nature of the donation made by the Clemente Siblings
is a donation subject to a condition – the condition being
the construction of a government hospital and the use of
13
C. Obligations of Each Co-owners
PARDELL v. BARTOLOME
FACTS:Appeal by bill of exceptions.Spouses Miguel Ortiz
and CalixtaFelin died in Vigan, Ilocos Sur, in 1875 and
1882, respectively. Prior to her death, Calixta, executed,
on August 17, 1876, a nuncupative will in Vigan, whereby
she made her four children,named Manuel, Francisca,
Vicenta, and Matilde, surnamed Ortiz y Felin, her sole and
universal heirs of all her property. Manuel and Francisca
were already deceased, leaving Vicenta and Matilda as
heirs.In 1888, the defendants (Matilde and Gaspar),
without judicial authorization, nor friendly or extrajudicial
agreement, took upon themselves the administration and
enjoyment of the properties left by Calixta and collect the
rents, fruits, and products thereof, to the serious detriment
of Vicenta’s interest. Despite repeated demands to divide
the properties and the fruits accruing therefrom, Sps
Gaspar and Matilde had been delaying the partition and
delivery of the said properties by means of unkempt
promises and other excuses.Vicenta filed a petition for
partition with damages in the RTC.RTC decision:
absolved Matilde from payment of damages. It held that
the revenues and the expenses were compensated by the
residence enjoyed by the defendant party, that no losses
or damages were either caused or suffered, nor likewise
any other expense besides those
aforementioned,Counsel for Matilde took an exception to
the judgment and moved for a new trial on the grounds
that the evidence presented did not warrant the judgment
rendered and that the latter was contrary to law. That
motion was denied by the lower court. Thus, this petition.
ISSUE:WON a co-owner is required to pay for rent
exclusively using the co-owned property.
RULING:Article 394 of the Civil Code prescribes:"Each
co-owner may use the things owned in common, provided
he uses them in accordance with their object and in such
manner as not to injure the interests of the community nor
prevent the co-owners from utilizing them according to
their rights."
Matilde Ortiz and her husband occupied the upper story,
designed for use as a dwelling, in the house of joint
ownership; but the record shows no proof that, by so
doing, the said Matilde occasioned any detriment to the
interests of the community property, nor that she
prevented her sister Vicenta from utilizing the said upper
story according to her rights. It is to be noted that the
stores of the lower floor were rented and an accounting of
the rents was duly made to the plaintiffs.Each co-owner of
realty held pro indiviso exercises his rights over the whole
property and may use and enjoy the same with no other
limitation than that he shall not injure the interests of his
co-owners, for the reason that, until a division be made,
the respective part of each holder can not be determined
and every one of the co-owners exercises together with
his other co-participants, joint ownership over the pro
indiviso property, in addition to his use and enjoyment of
the same.
As the hereditary properties of the joint ownership of the
two sisters, Vicenta Ortiz, plaintiff, and MatildeOrtiz,
defendant, were situated in the Province of Ilocos Sur,
and were in the care of the last named, assisted by her
husband, while the plaintiff Vicenta with her husband was
residing outside of the said province the greater part of
the time between 1885 and 1905, when she left these
Islands for Spain, it is not at all strange that delays and
difficulties should have attended the efforts made to
collect the rents and proceeds from the property held in
common and to obtain a partition of the latter, especially
during several years when, owing to the insurrection, the
country was in a turmoil; and for this reason, aside from
that founded on the right of co-ownership of the
defendants, who took upon themselves the administration
and care of the property of joint tenancy for purposes of
their preservation and improvement,these latter are not
obliged to pay to the plaintiff Vicenta one-half of therents
which might have been derived from the upper story of the
said house on CalleEscolta, and, much less,because one
of the living rooms and the storeroom thereof were used
for the storage of some belongings and effects of common
ownership between the litigants.
The defendant Matilde, therefore, in occupying with her
husband the upper floor of the said house, did not injure
the interests of her co-owner, her sister Vicenta, nor did
she prevent the latter from living therein, but merely
exercised a legitimate right pertaining to her as a co-
owner of the property.
Notwithstanding the above statements relative to the joint-
ownership rights which entitled the defendants to live in
the upper story of the said house, yet, in view of the fact
that the record shows it to have been proved that the
defendant Matilde's husband,Gaspar de Bartolome,
occupied for four years a room or apart of the lower floor
of the same house on CalleEscolta, using it as an office
for the justice of the peace, opposition which he held in
the capital of that province, strict justice requires that he
pay his sister-in-law, the plaintiff, one-half of the monthly
rent which the said quarters could have produced, had
they been leased to another person.The amount of such
monthly rental is fixed at P16 in appearance with the
evidence shown in the record. This conclusion as to
Bartolome's liability results from the fact that, even as the
husband of the defendant co-owner of the property, he
had no right to occupy and use gratuitously the said part
of the lower floor of the house in question, where he lived
with his wife, to the detriment of the plaintiff Vicenta who
did not receive one-half of the rent which those quarters
could and should have produced, had they been occupied
by a stranger, in the same manner that rent was obtained
from the rooms on the lower floor that were used as
stores.
Therefore, the defendant Bartolome must pay to the
plaintiff Vicenta P384, that is, one-half of P768, the total
14
amount of the rents which should have been obtained D. Extinguishment of Co-ownership
during four years from the quarters occupied as an office
by the justice of the peace of Vigan. CARO v. CA

FACTS: Alfredo Benito, Mario Benito and Benjamin

Benito were the original co-owners of two parcels of land.

Mario died sometime in January, 1957. His surviving wife,

Basilia Lahorra and his father, Saturnino Benito, were
appointed in Special Proceeding No. 508 of the Court of
First Instance of Sorsogon as joint administrators of
Mario's estate.

Benjamin Benito, one of the co-owners,executed a deed

of absolute sale of his one-third undivided portion over
said parcels of land in favor of herein petitioner, Luz Caro.
This was registered on September 29, 1959. Caro was
issued TCT No. T-4978 over LOT I-C upon consent by
Saturnino and Alfredo Benito.

Luz Caro made an allegation in a pleading

presented in Spec. Pro No. 508 that she acquired by
purchase from Benjamin Benito the aforesaid one-third
undivided share in each of the two parcels of land. Basilia
Lahorra Vda. De Benito a written offer to redeem to
redeem the said one-third undivided share.

Caro ignored the offer, thus Basilia sought to

intervene in Civil Case No. 2105 entitled "Rosa Amador
Vda. de Benito vs. Luz Caro" for annulment of sale and
mortgage and cancellation of the annotation of the sale
and mortgage involving the same parcels of land. The
main case was dismissed. Basilia then filed the present
case as an independent one and in the trial sought to
prove that as a joint administrator of the estate of Mario
Benito, she had not been notified of the sale as required
by Article 1620 in connection with Article 1623 of the New
Civil Code.

The trial court dismissed the complaint on the grounds

that: (a) private respondent, as administratrix of the
intestate estate of Mario Benito, does not have the power
to exercise the right of legal redemption, and (b) Benjamin
Benito substantially complied with his obligation of
furnishing written notice of the sale of his one-third
undivided portion to possible redemptioners. MR was
denied, thus she appealed to CA which ruled that since
the right of the co-owner to redeem in case his share be
sold to a stranger arose after the death of Mario Benito,
such right did not form part of the hereditary estate of
Mario but instead was the personal right of the heirs, one
of whom is Mario's widow. Thus, it behooved either the
vendor, Benjamin, or his vendee, Luz Caro, to have made
a written notice of the intended or consummated sale
under Article 1620 of the Civil Code. CA reversed the
appealed judgment; MR was denied. Thus, this present
petition.

ISSUE: Whether Basilia, as administrator of Mario’s

estate, could exercise the right of redemption.

15
RESOLUTION: NO.
Sec. 3, Rule 85, Rules of Court, the administrator
has the right to the possession of the real and personal
estate of the deceased, so far as needed for the payment
of the expenses of administration, and the administrator
may bring and defend action for the recovery or protection
of the property or right of the deceased (Sec. 2, Rule 88),
such right of possession and administration do not include
the right of legal redemption of the undivided share sold
to a stranger by one of the co-owners after the death of
another, because in such case, the right of legal
redemption only came into existence when the sale to the
stranger was perfected and formed no part of the estate
of the deceased co-owner; hence, that right cannot be
transmitted to the heir of the deceased co-owner. (Butte
vs. Manuel Uy and Sons, Inc., 4 SCRA 526).
Even assuming that redemption exists, private
respondent as administratrix, has no personality to
exercise said right for and in behalf of the intestate estate
of Mario Benito. She is on the same footing as co-
administrator Saturnino Benito. Hence, if Saturnino's
consent to the sale of the one-third portion to petitioner
cannot bind the intestate estate of Mario Benito on the
ground that the right of redemption was not within the
powers of administration, in the same manner, private
respondent as co-administrator has no power exercise
the right of redemption — the very power which the Court
of Appeals ruled to be not within the powers of
administration.
Basilia cannot be considered to have brought this action
in her behalf and in behalf of the heirs of Mario Benito
because the jurisdictional allegations of the complaint
specifically stated that she brought the action in her
capacity as administratrix of the intestate estate of Mario
Benito.
Bailon-Casilao v. CA (1988)
Petitioners: Delia Bailon-Casilao, Luz Paulino-Ang,
Emma Paulino-Ybanez, Nilda Paulino-Tolentino, and
Sabina Bailon Respondents: CA and Celestino Afable
Ponente: Cortes, J.
FACTS:
The fate of petitioners' claim over a parcel of land rests
ultimately on a determination of whether or not said
petitioners are chargeable with such laches as may
effectively bar their present action.
There is a parcel of land in the names of the Bailons
(Rosalia, Gaudencio, Sabina Bernabe, Nenita and Delia)
as co- owners, each with a 1/6 share.
o Gaudencio and Nenita are now dead, (Nenita
being represented in this case by her children)
o Bernabe went to China and had not been heard
from since
It appears that Rosalia and Gaudencio sold a portion of
the land to Donato Delgado. Rosalia alone, then sold the
remainder of the land to Ponciana Aresgado de Lanuza.
o On the same date, Lanuza acquired from
Delgado land which the Delgado had earlier
acquired from Rosalia and Gaudencio.
Husband John Lanuza, acting under a special power of
attorney given by his wife, Ponciana, sold the two parcels
of land to Celestino Afable, Sr.
In all these transfers, it was stated in the deeds of sale
that the land was not registered under the provisions of
Act No. 496 when the fact is that it is.
o It appears that the land had been successively
declared for taxation first, in the name of Ciriaca
Dellamas, mother of the co-owners, then in the
name of Rosalia Bailon, then in that of Donato
Delgado, then in Ponciana de Lanuza's name,
and finally in the name of Celestino Afable, Sr.
The petitioners in this case, the Bailons, filed a case for
recovery of property against Celestino Afable. In his
answer, Afable claimed that he had acquired the land in
question through prescription and said that the Bailons
are
guilty of laches.
LC declared Afable co-owner because he validly bought
2/6 of the land (the shares of Rosalia and Gaudencio)
CA affirmed. Prescription does not apply against the
Bailons because they are co-owners of the original
sellers. But, an
action to recover may be barred by laches.
o CA held the Bailons guilty of laches and
dismissed their complaint
Issue: Applicability of the doctrine of laches
RULING:
16
Initially, a determination of the effect of a sale by one or
more co-owners of the entire property held in common
without the consent of all the co-owners and of the
appropriate remedy of the aggrieved co-owners is
required. The rights of a co-owner of a certain property
are clearly specified in NCC 493:
• Art. 493. Each co-owner shall have the full
ownership of his part and of the acts and benefits
pertaining thereto, and he may therefore alienate
assign or mortgage it and even substitute another
person in its enjoyment, except when personal
rights are involved. But the effect of the alienation
or mortgage, with respect to the co-owners, shall
be limited to the portion which may be allotted to
him in the division upon the termination of the co-
ownership
SC has already ruled in other cases that even if a co-
owner sells the whole property as his, the sale will affect
only his own share but not those of the other co-owners
who did not consent to the sale
o By virtue of the sales made by Rosalia and
Gaudencio, which are valid with respect to their
proportionate shares, and the subsequent
transfers which culminated in the sale to private
respondent Celestino Afable, Afable thereby
became a co-owner of the disputed parcel of land
Since a co-owner is entitled to sell his undivided share, a
sale of the entire property by one co-owner without the
consent of the other co-owners is not null and void.
o However, only the rights of the co-owner-seller
are transferred, thereby making the buyer a co-
owner of the property.
Re: Proper action
• The proper action in cases like this is not for the
nullification of the sale or for the recovery of
possession but the division of the common
property
• Neither recovery of possession nor restitution
can be granted since the buyers are legitimate
possessors in joint ownership of the common
property claimed
Re: Prescription
• Here, prescription cannot be invoked.
• Pursuant to NCC 494, no co-owner shall be
obliged to remain in the co-ownership. Such
co owner may demand at anytime the partition
of the thing owned in common, insofar as his
share is concerned.
• In Budiong v. Bondoc , SC has
interpreted that provision to mean that
the action for partition is imprescriptible
or cannot be barred by prescription. For
NCC 494 explicitly declares: No
prescription shall lie in favor of a co-
owner or co- heir so long as he expressly
or impliedly recognizes the co-
ownership.
• Also, the disputed parcel of land being
registered under the Torrens System, the express
provision of Act No. 496 that “no title to registered
land in derogation to that of the registered owner
shall be acquired by prescription or adverse
possession” is applicable.
• Prescription will not lie in favor of Afable as
against the Bailons who remain the registered
owners of the parcel of land.
Re: Argument of Bailons that as to the children who
represent their deceased mother, Nenita, prescription
lies
• It is argued, that as to the children who are not the
registered co-owners but merely represent their deceased
mother, prescription lies. (citing Pasion v. Pasion: "the
imprescriptibility of a Torrens title can only be invoked by
the person in
whose name the title is registered" and that 'one who is
not the registered owner of a parcel of land cannot invoke
imprescriptibility of action to claim.'
• Reliance on the previous case is wrong.
o The ruling there applies only against
transferees other than direct issues or heirs or to
complete strangers. The reason for that is: if
prescription is unavailing against the registered
owner, it must be equally unavailing against the
owner’s hereditary successors, because they
merely step into the shoes of the decedent
Re: Laches
• Petitioners are not barred from laches.
• Laches is also unavailing as a shield against the action
of petitioners Bailon.
o There are 4 basic elements of laches
1) Conduct on the part of the defendant or of one
under whom he claims, giving rise to the situation
of which complaint is made and for which the
complainant seeks a remedy;
2) Delay in asserting the corporations
complainant's rights, the complainant having had
knowledge or notice of the defendant's conduct
and having been afforded an opportunity to
institute suit;
3) Lack of knowledge or notice on the part of the
defendant that the complainant would assert the
right on which he bases his suit; and,
4) Injury or prejudice to the defendant in the event
relief is accorded to the complainant, or the suit is
not held to be barred
o First and last elements are present.
o Second and third elements are missing.
• The second element speaks of delay in asserting the
complainant's rights.
o However, the mere fact of delay is insufficient
to constitute, laches.
o It is required that (1) complainant must have
had knowledge of the conduct of defendant or of
17
 one under whom he claims and (2) he must have FACTS: The land in question is co-owned by Rosalia,
been afforded an opportunity to institute suit. Gaudencio, Sabina Bernabe, Nenita and Delia, all
o This court has pointed out that laches is not surnamed Bailon, as co-owners. Rosalia and Gaudencio
concerned with the mere lapse of time. Bailon sold a portion of the land to Donato Delgado.
• Laches is defined as the failure or neglect, for an Rosalia then sold the remaining portion to Ponciana de
unreasonable length of time to do that which by exercising Lanuza. De Lanuza later acquired the whole lot which she
due diligence could or should have been done earlier; it is later sold to private respondent Celestino Afable.
negligence or omission to assert a right within a
reasonable time warranting a presumption that the party Upon learning of the sale, the other co-owners filed for the
entitled to assert it either has abandoned it or declined to recovery of the property. Afable, in his defense, claimed
assert it. that he already acquired the land through prescription and
o The doctrine of "laches" or of "stale demands" contended that the petitioners were guilty of laches.
is based upon grounds of public policy which
requires for the peace of society, the ISSUE: Is the action for the recovery of property proper in
discouragement of stale claims and unlike the this case?
statute of limitations, is not a mere question of
time but is principally a question of inequity or
unfairness of permitting a right or claim to be HELD: NO. A co-owner is entitled to sell his undivided
enforced or asserted. share. A sale of the entire property of one co-owner
without the consent of the other co-owners is not null and
• While there was delay in asserting the Bailon’s rights,
void. However, only the rights of the co-owner of the
such delay was not attended with any knowledge of the
property were transferred by virtue of such sale. The
sale nor with any opportunity to bring a suit.
proper action in such case is the division of the common
o In the first place, the Bailons had no notice of
property as if it continued to remain in the possession of
the sale made by their eldest sister.
the co-owners who possessed and administered it.
o In the second place, they were not afforded an
opportunity to bring suit because they were kept
in the dark about the transactions entered into by Hence, the petitioners in this case should have filed an
their sister. It was only when Delia returned that action for partition instead of an action for recovery.
she found out about the sales and immediately,
she and her siblings filed the present action for
recovery of property. • The third element of
laches is absent.
o There was no lack of knowledge
o It is actually Afable who is guilty of bad faith in
purchasing the property as he knew that the
property was co- owned by six persons and yet,
there were only two signatories to the deeds of
sale and no special authorization to self was
granted to the two sellers by the other co-owners.
• A person dealing with a registered land has a right to
rely upon the face of the Torrens certificate of title and to
dispense
with the need of inquiring further, except when the party
concerned has actual knowledge of facts and
circumstances that
would impel a reasonably cautions man to make such
inquiry.
• Also, petitioners Bailon are relatives of his wife. As a
gesture of good faith, he should have contacted the
Bailons who
were still listed as co-owners in the certificate of title which
was already in his possession even before the sale.
o In failing to exercise even a minimum degree of
ordinary prudence, he is deemed to have bought
the lot at his own risk.
o Hence any prejudice or injury that may be
occasioned to him by such sale must be borne by
him.

Decision set aside

18
ROQUE VS. INTERMEDIATE APPELLATE COURT
No. L-75886. August 30, 1988.
FACTS: Petitioner Concepcion Roque seeks for partition
for a parcel of land sold unto her by her half brother
Ernesto and Victor Roque which is ¾ share of Lot 1549
evidenced by a “Bilihan Lubos at Patuluyan” dated
November 27, 1961 but the said document is unnotarized.
The remaining ¼ portion is being owned by Ernesto and
Victor Roque from an extrajudicial partition.
Upon the subdivision plan conducted by a Geodetic
Engineer, Respondents Ernesto Roque and heirs of
Victor Roque refused to acknowledge the petitoner’s
claim of ownership and rejected the plan to divide the
land.
Petitioner Concepcion Roque filed a Complaint for
Partition with Specific Performance at CFI Malolos
claiming the legal ownership of ¾ portion of Lot 1549 by
virtue of Bilihang Lubos at Panuluyan. She alleged that,
as co-owner of Lot 1549, she had a right to seek partition
of the property, that she could not be compelled to remain
ion the co-ownership of the same.
Respondent impugned the geniuneness of the documents
and that the signatures do not appear authentic of the
supposed signatures. Respondents also refused to honor
the unnotarized Kasulatan.
CFI ruled in favor of Concepcion Roque.
IAC reversed the judgment of the RTC and denied the
petitioner’s Motion for Reconsideration.
IAC stated in its decision that an action for partition will
not prosper as such from the moment an alleged co-
owner asserts an adverse title. The action that may be
brought by an aggrieved co-owner is accion
reivindicatoria or action for recovery of title and
possession. Should the reinvidicatory action to prosper, a
co-ownership relation is found to have existed between
the parties.
Shorter facts: Co-owners Avendaño transferred their
undivided 3/4 share in Lot No. 1549 to respondents
Ernesto and Victor Roque, thereby vesting in the latter full
and complete ownership of the property. The transactions
were embodied in 2 separate deeds of sale both duly
notarized. Subsequently, in an unnotarized deed of sale,
respondents purportedly sold a 3/4 undivided portion of
Lot No. 1549 to their half-sister, petitioner Concepcion
Roque. Upon the instance of petitioner and allegedly of
respondents, a Subdivision Plan was drawn identifying
and delineating a 1/4 portion of the property as belonging
to respondents and a 3/4 portion of the same property as
belonging to petitioner. Petitioner claimed that preparation
of the Subdivision Plan was a preliminary step leading
eventually to partition of Lot No. 1549, partition allegedly
having been previously agreed upon inter se by the co-
owners. Respondents, however, refused to acknowledge
petitioner's claim of ownership of any portion of Lot No.
1549 and rejected the plan to divide the land.
Petitioner filed a complaint for Partition with Specific
Performance, alleging that, as co-owner, she had a right
to seek partition of the property, and that she could not be
compelled to remain in the coownership. In their answer,
respondents impugned the genuineness and due
execution of the deed of sale on the ground that the
signatures appearing thereon are not the authentic
signatures of the supposed signatories. It was also
alleged that petitioner occupied a portion of the lot in
question by mere tolerance. The Intermediate Appellate
Court (IAC) dismissed the case on the ground that after
respondents denied co-ownership and asserted that they
are the exclusive and sole owners of the disputed land,
the case has become one of ownership thus the action
that may be brought by an aggrieved co-owner is accion
reivindicatoria.
ISSUES:
1. Is the IAC correct in ruling that partition is not the right
remedy?
2. Should prescription run in favor of respondents, barring
petitioner’s action for partition?
3. Whether or not the Petitioner is a co-owner of the
property sought to be partitioned.
RULING:
1. NO. An action for partition presents simultaneously two
principal issues. First, there is the issue of whether the
plaintiff is indeed a co-owner of the property sought to be
partitioned. Second, assuming that the plaintiff
successfully hurdles the first issue, there is the secondary
issue of how the property is to be divided between plaintiff
and defendant — i.e., what portion should go to which co-
owner. Should the trial court find that the defendants do
not dispute the status of the plaintiff as co-owner, the court
can forthwith proceed to the actual partitioning of the
property involved. In case the defendants assert in their
Answer exclusive title in themselves adversely to the
plaintiff, the court should not dismiss the plaintiffs action
for partition but, on the contrary, resolve the question of
whether the plaintiff is co-owner or not. Should the trial
court find that the plaintiff was unable to sustain his
claimed status as co-owner, or that the defendants are or
have become the sole and exclusive owners of the
property involved, the court will necessarily have to
dismiss the action for partition. This result would be
reached, not because the wrong action was commenced
by the plaintiff, but rather because the plaintiff having
been unable to show co- ownership rights in himself, no
basis exists for requiring the defendants to submit to
partition the property at stake. If, upon the other hand, the
court after trial should find the existence of co-ownership
19
among the parties litigant, the court may and should order The court notes in this respect the finding of the trial court
the partition of the property in the same action. that petitioner, following execution of the “Bilihan Lubos at
Patuluyan whereon the petitioner’s house and her sons
2. NO. Article 494 of the Civil Code provides that "each are erected, had been in continuous occupancy of the ¾
co-owner may demand at any time the partition of the portion of Lot 1549.
thing owned in common, insofar as his share is
concerned." No matter how long the co-ownership has
lasted, a co-owner can always opt out of the co-
ownership, and provided the defendant co-owners or co-
heirs have expressly or impliedly recognized the co-
ownership, they cannot set up as a defense the
prescription of the action for partition. But if the
defendants show that they had previously asserted title in
themselves adversely to the plaintiff and for the requisite
period of time, the plaintiff’s right to require recognition of
his status as a co-owner will have been lost by
prescription and the court cannot issue an order requiring
partition. In this case, petitioner has been and is presently
in open and continuous possession of a 3/4 portion of the
property owned in common. Respondents do not dispute
this finding of fact, although they would claim that
petitioner's possession is merely tolerated by them.
Moreover, prior to filing of the complaint, neither of the
parties involved had asserted or manifested a claim of
absolute and exclusive ownership over the whole of Lot
No. 1549 adverse to that of any of the other co- owners.
In other words, co-ownership of the property had
continued to be recognized by all the owners.
Consequently, the action for partition could not have and,
as a matter of fact, had not yet prescribed at the time of
institution by petitioner of the action.

3. YES. Petitioner Concepcion Roque is a co-owner of

Lot 1549 and therefore entitled to the ¾ portion of the said
land.The Supreme Court reinstated the decisionof CFI
Malolos.

Under Art 494 for the Civil Code, each co-owner may
demand at any time the partition of the thing owned in
common, insofar as his share is concerned.

Petitioner Concepcion Roque, the co-owner seeking

partition has been and is presently in open and continuous
possession of the ¾ portion of the property owned in
common.

Prior to filing of the parties involved had asserted or

manifested a claim of absolute and exclusive ownership
ove the whole Lot 1549 thus, co-ownership of the property
had continued to be recognized by all the owners.

If he court after trial should find the existence of co-

ownership among the parties-litigant, the court may and
should order the partition of the property in the same
action.

The action for partition of the thing owned in common

does not prescribe.

20
Epitacio Delima, et al. v. Court of Appeals
G.R. No. L-46296; September 24, 1991 MEDIALDEA, J.:
FACTS:
Lino Delima acquired Lot. No. 7758 of the Talisay-
Minglanilla Friar Lands Estate in Cebu by sale on
installments from the government. After his death in 1921
he had his three brothers (Eulalio, Galileo and Vicente)
and a sister (Juanita) listed as his heirs. A new TCT was
issued in the name of the Legal Heirs of Lino Delima
represented by Galileo Delima. On 1953, Galileo
executed an affidavit of Extra-judicial Declaration of Heirs
adjudicating to himself the subject property excluding the
other heirs. He declared the lot to be of his own and paid
for its taxes. On 1968, the surviving heirs of Eulalio and
Juanita Delima, filed with the CFI of Cebu an action for
reconveyance and partition of property and for the
annulment of the certificate of title issued plus damages
against their Uncle Galileo. Vicente Delima was also later
included as party defendant for his refusal to help in the
action.
ownership, and denies the others any share therein. The
imprescriptibility of the action for partition shall no longer
apply since Galileo is adversely claiming lone ownership
over the property. In order that a possession be
considered adverse amounting to a repudiation of the co-
ownership, the following elements must concur: (1) that
the trustee has performed the unequivocal acts
amounting to an ouster of the cestui que trust; (2) that
such positive acts of repudiation had been made known
to the cestui que trust; and (3) that the evidence thereon
should be clear and conclusive.
Since Galileo, having executed a deed of partition and
obtained subsequent to that the cancellation of the old title
and the creation of a new one wherein he appears as the
new owner of the property, he thereby in effect denied and
repudiated the ownership of the other co-owners over
their shares. From this act, the statute of limitations
started to run.

The trial court decided in favor of the petitioners rendering

the TCT No. 3009 null and void and declaring Vicente, the
Heirs of Juanita, the Heirs of Eulalio and the Heirs of
Galileo to be owners of the property, each sharing a pro-
indiviso share of 1⁄4 of the whole. The respondents, Heirs
of Galileo Delima, appealed to the Court of Appeals which
reversed the decision in their favor. It upheld the claim of
Galileo that the other brothers and sisters have already
waived their rights to the property being that it was Galileo
alone that paid for the balance of the purchase price and
the realty taxes for the property.

ISSUE:

Whether or not the petitioners’ action for partition is

already barred by the statutory period provided by law
which shall enable Galileo Delima to perfect his claim of
ownership by acquisitive prescription to the exclusion of
petitioners from their shares in the disputed property

HELD:

YES. Article 494 (5) of the Civil Code provides that: “No
prescription shall run in favor of a co-owner or co-heir
against his co-owners or co-heirs so long as he expressly
or impliedly recognized the co- ownership.” By this it is
therefore understood that possession by a co-owner will
not be presumed to be adverse to the others, but will be
held to benefit all. Being that Galileo was holding the
property in representation of the co-owners; he was
therefore acting as an administrator who took care of the
property yet still having the ultimate obligation to deliver
the property to his co-owners.

However this rule shall no longer apply when one of the

co-owners begin to claim the absolute and exclusive
21
Virgilio B. Aguilar v. Court of Appeals and Senen B.
Aguilar
G.R. No. 76351; October 29, 1993 BELLOSILLO, J.:
FACTS:
Virgilio and Senen Aguilar, sons of Maximiano, purchased
a house and lot where their father could spend and enjoy
his remaining years in a peaceful neighborhood. Initially,
the brothers agreed that Virgilio’s share in the co-
ownership was two-thirds while that of Senen was one-
third. By virtue of a written memorandum, Virgilio and
Senen agreed that their interests in the house and lot
should be equal, with Senen assuming the remaining
mortgage obligation of the original owners with the SSS
in exchange for his possession and enjoyment of the
house together with their father. Since Virgilio was
disqualified from obtaining a loan from SSS, they agreed
that the deed of sale would be executed and the title
registered in the meantime in the name of Senen. It was
further agreed that Senen would take care of their father
and his needs since Virgilio and his family were staying in
Cebu.
After their father’s death, Virgilio demanded that Senen
vacate the house and that the property be sold and
proceeds thereof divided among them. Because of the
Senen’s refusal, Virgilio filed an action to compel the sale.
The trial court found the brothers to be co-owners of the
house and lot in equal shares on the basis of their written
agreement; that Virgilio has been deprived of his
participation in the property by Senen’s continued
enjoyment of the house and lot, free of rent, despite
demands for rentals; that Virgilio had a right to demand
partition; that the property should be sold to a third person
and the proceeds divided equally between the parties;
and that Senen vacate the property and pay Virgilio
rentals. Senen appealed to the CA which set aside the
trial court decision. Thus, Virgilio filed a petition for
Certiorari with the SC.
ISSUE:
Was the co-ownership termination upon the filing and the
granting of the action to compel sale of the property and
ejectment of a co-owner?
HELD:
YES. Co-ownership is deemed terminated and the right to
enjoy possession jointly also ceased upon filing and the
granting of action to compel the sale of the property and
the ejectment of Senen.
Article 494 of the Civil Code provides that no co-owner
shall be obliged to remain in the co-ownership, and that
each co-owner may demand at any time partition of the
thing owned in common insofar as his share is concerned.
Corollary to this rule, Art. 498 of the Code states that
whenever the thing is essentially indivisible and the co-
owners cannot agree that it be allotted to one of them who
shall indemnify the others, it shall be sold and its proceeds
accordingly distributed. This is resorted to (1) when the
right to partition the property is invoked by any of the co-
owners but because of the nature of the property it cannot
be subdivided or its subdivision would prejudice the
interests of the co-owners, and (b) the co- owners are not
in agreement as to who among them shall be allotted or
assigned the entire property upon proper reimbursement
of the co-owners. In one case, this Court upheld the order
of the trial court directing the holding of a public sale of
the properties owned in common pursuant to Art. 498 of
the Civil Code.
However, being a co-owner, Senen has the right to use
the house and lot without paying any compensation to
Virgilio, as he may use the property owned in common so
long as it is in accordance with the purpose for which it is
intended and in a manner not injurious to the interest of
the other co- owners. Each co-owner of property held pro
indiviso exercises his rights over the whole property and
may use and enjoy the same with no other limitation than
that he shall not injure the interests of his co- owners, the
reason being that until a division is made, the respective
share of each cannot be determined and every co-owner
exercises, together with his co-participants joint
ownership over the pro indiviso property, in addition to his
use and enjoyment of the same.
When Virgilio filed an action to compel the sale of the
property and the trial court granted the petition and
ordered the ejectment of Senen, the co-ownership was
deemed terminated and the right to enjoy the possession
jointly also ceased. Thereafter, the continued stay of
Senen and his family in the house prejudiced the interest
of Virgilio as the property should have been sold and the
proceeds divided equally between them. To this extent
and from then on, Senen should be held liable for monthly
rentals until he and his family vacate.
22
Tomas Claudio Memorial College, Inc. v. Court of
Appeals
G.R. No. 124262; October 12, 1999
QUISUMBING, J.:
FACTS:
On December 13, 1993, Private respondents De Castro
filed an action for partition of a parcel of land located at
Barrio San Juan, Morong Riza, with an area of 2,269 Sq.m
more or less before the RTC of Rizal.
They alleged that their predecessor-in-interest (father),
Juan De Castro, died intestate in 1993 and they are his
only surviving and legitimate heirs.
They also alleged that their father owned a parcel of land
designated as Lot No. 3010 with an area of 2,269 square
meters more or less. They further claim that in 1979,
without their knowledge and consent, said lot was sold by
their brother Mariano to petitioner. The sale was made
possible when Mariano represented himself as the sole
heir to the property.
It is the contention of private respondents that the sale
made by Mariano affected only his undivided share to the
lot in question but not the shares of the other co-owners
equivalent to four fifths (4/5) of the property.
Tomas Claudio filed a Motion to Dismiss on the ground of
lack of jurisdiction, PRESCRIPTION/LACHES. Petitioner
alleges prescription and/or laches. Complaint of De
Castro’s was denied. Motion for Reconsideration of De
Castro’s was granted. Tomas Claudio filed a special civil
action for certiorari with CA but the petition was dismissed
and so its MR. Hence, the present case.
ISSUE:
Whether or not an action, by a co-owner, to partition a
property owned in common prescribes.
W/N the sale by Mariano effectively include the entire
land.
W/N the action for partition filed by the siblings of Mariano
is barred by prescription.
HELD:
No. On the issue of prescription, we have ruled that even
if a co-owner sells the whole property as his, the sale will
affect only his own share but not those of the other co-
owners who did not consent to the sale. Under Article 493
of the Civil Code, the sale or other disposition affects only
the seller’s share pro indiviso, and the transferee gets only
what corresponds to his grantors share in the partition of
the property owned in common. Since a co-owner is
entitled to sell his undivided share, a sale of the entire
property by one co-owner without the consent of the other
co-owners is not null and void. However, only the rights of
the co-owner/seller are transferred, thereby making the
buyer a co-owner of the property.
The proper action in a case like this, is not for the
nullification of the sale, or for the recovery of possession
of the property owned in common from the third person,
but for division or partition of the entire property if it
continued to remain in the possession of the co-owners
who possessed and administered it. Such partition should
result in segregating the portion belonging to the seller
and its delivery to the buyer.
Petitioner’s defense of prescription against an action for
partition is a vain proposition. Pursuant to Article 494 of
the Civil Code, no co-owner shall be obliged to remain in
the co-ownership. Such co-owner may demand at
anytime the partition of the thing owned in common,
insofar as his share is concerned. In Budlong vs. Bondoc,
this Court has interpreted said provision of law to mean
that the action for partition is imprescriptible. It cannot be
barred by prescription. For Article 494 of the Civil Code
explicitly declares: No prescription shall lie in favor of a
co-owner or co-heirs as long as he expressly or impliedly
recognizes the co-ownership.
NO. Under Article 493 of the Civil Code, the sale or
other disposition affects only the seller’s share pro
indiviso, and the transferee gets only what corresponds to
his grantor’s share in the partition of the property owned
in common. Since a co-owner is entitled to sell his
undivided share, a sale of the entire property by one co-
owner without the consent of the other co-owners is not
null and void. However, only the rights of the co-
owner/seller are transferred, thereby making the buyer a
co-owner of the property. The proper action in a case like
this, is not for the nullification of the sale, or for the
recovery of possession of the property owned in common
from the third person, but for division or partition of the
entire property if it continued to remain in the possession
of the co-owners who possessed and administered it.
Such partition should result in segregating the portion
belonging to the seller and its delivery to the buyer.
NO. Article 494 of the Civil Code explicitly declares:
“No prescription shall lie in favor of a co-owner or co-heirs
as long as he expressly or impliedly recognizes the co-
ownership.”
23
In the light of the foregoing, petitioner’s defense of
prescription against an action for partition is a vain
proposition. Pursuant to Article 494 of the Civil Code, “no
co-owner shall be obliged to remain in the co-ownership.
Such co-owner may demand at anytime the partition of
the thing owned in common, insofar as his share is
concerned.” In Budlong vs. Bondoc,10 this Court has
interpreted said provision of law to mean that the action
for partition is imprescriptible. It cannot be barred by
prescription.
Lucio Robles, Emeteria Robles, Aludia Robles and
Emilio Robles v. Court of Appeals, spouses Virgilio
Santos and Baby Ruth Cruz, Rural Bank of Cardona,
Inc., Hilario Robles, Alberto Palad Jr. in his capacity
as Director of Lands, and Jose Mauleon in his
capacity as District Land Officer of the Bureau Of
Lands
G.R. No. 123509; March 14, 2000 PANGANIBAN, J.:
FACTS:
The property subject of this case is originally owned by
Leon Robles. When he died, it passed to his son Silvino
who declared the property in his name and paid the taxes
thereon. Upon the latter’s death, his widow and children
inherited the property. Petitioners Lucio Robles, et al.
were the children of Silvino, and Hilario Robles is their
half-brother. The task of cultivating was assigned to Lucio
while the payment of the land taxes was entrusted to
Hilario. For unknown reason, the tax declaration of the
parcel of land in the name of Silvino was cancelled and
transferred to Exequiel Ballena.
Ballena secured a loan from Antipolo Rural Bank using
the tax declaration as security. Somehow the tax
declaration was transferred to the name of Antipolo Rural
Bank and later was transferred to the name of respondent
spouses Hilario and Andrea Robles. Andrea secured a
loan from Cardona Rural Bank using the tax declaration
as security. For failure to pay the mortgage debt, the
property was foreclosed with Cardona Rural Bank
emerging as the highest bidder. The bank sold the
property to spouses Vergel and Ruth Santos. In Sept.
1987, petitioners discovered the mortgage and attempted
to redeem the property but was unsuccessful.
In 1988, the spouses Santos took possession of the
property and was able to secure a Free Patent. Petitioners
then filed an action for quieting of title. Respondents
questioned their standing to sue for quieting of title,
contending that petitioners no longer have any interest to
the property in question due to the mortgage effected by
Hilario and the consequent foreclosure thereof by the
Bank. Respondents argued that Hilario had become the
absolute owner of the property at the time he mortgaged
the same. The CA ruled that the several transfers of the
tax declaration of the
property in question from Silvino until to the spouses
Santos had the effect of divesting petitioners of their title
by prescription to Hilario.
ISSUES:
1. Do the petitioners have appropriate title that will entitle
them to the remedy of the quieting of title? 2. Did Hilario
acquire the share of his co-owners in the disputed
property by prescription?
24
HELD:
1. YES. An action to quiet title, under Art. 476, NCC, is a
common-law remedy for the removal of any cloud or doubt
or uncertainty on the title to real property.
declaration of ownership was tantamount to repudiation
was belied by the continued occupation and possession
of the disputed property by the petitioners as owners.

It is essential for the plaintiff or complainant to have a legal

or an equitable title to or interest in the real property which
is the subject matter of the action. Also, the deed, claim,
encumbrance or proceeding that is being alleged as a
cloud on plaintiff's title must be shown to be in fact invalid
or inoperative despite its prima facie appearance of
validity or legal efficacy.

That there is an instrument or a document which, on its

face, is valid and efficacious is clear in the present case.
Petitioners allege that their title as owners and
possessors of the disputed property is clouded by the tax
declaration and, subsequently, the free patent thereto
granted to Spouses Santos. Petitioners anchor their claim
on their open and continuous possession as owners.
Spouses Santos, on the other hand, trace their claims to
Exequiel, and then to Hilario who mortgaged the same to
the Bank as absolute owner. It was from Exequiel that
Hilario’s claim is rooted. However, in this case, there is a
failure to show Exequiel’s title to the property in question.

When Hilario, therefore, mortgaged the property, he did

so in his capacity as mere co-owner thereof.
Consequently, the said transaction did not divest the
petitioner of the title to the property at the time of the
institution of the complaint for quieting of title.

2. NO. Hilario effected no clear and evident repudiation of

the co-ownership. It is a fundamental principle that a co-
owner cannot acquire by prescription the share of the
other co-owners, absent any clear repudiation of the
coownership.

In order that the title may prescribe in favor of a co-owner,

the following requisites must concur: (1) the co-owner has
performed unequivocal acts of repudiation amounting to
an ouster of the other co-owners; (2) such positive acts of
repudiation have been made known to the other co-
owners; and (3) the evidence thereof is clear and
convincing.

In the present case, Hilario did not have possession of the

subject property; neither did he exclude the petitioners
from the use and the enjoyment thereof, as they had
indisputably shared in its fruits. Likewise, his act of
entering into a mortgage contract with the bank cannot be
construed to be a repudiation of the co-ownership.

As absolute owner of his undivided interest in the land, he

had the right to alienate his share, as he in fact did.
Neither should his payment of land taxes in his name, as
agreed upon by the co-owners, be construed as a
repudiation of the co-ownership. The assertion that the
25
 E. Condominium Act (RA 4726)
LEVISTE MANAGEMENT SYSTEM v. LEGASPI
TOWERS 200 INC., et. al.
G.R. No. 199353 April 4, 2018
TOPIC: Builder in Good Faith
PONENTE: J. Leonardo-De Castro
AUTHOR: Reyes, Brixton
CASE LAW/ DOCTRINE:
• Art. 448 and 546 of the Civil Code on builders in
good faith are inapplicable in cases covered by
the Condominium Act.
• The land belongs to a condominium corporation
wherein the builder, as a unit owner, is
considered a stockholder or member under Sec.
10 of the Condominium Act. The builder is already
in co-ownership with other unit owners as
members or stockholders of the condominium
corporation. The purchaser of a condominium
unit binds himself to a contract with other unit
owners.
• A builder must gain the consent of other registered
owners and follow the by-rules of the condominium before
amending the Master Deed.
FACTS:
1. Legaspi Towers is a 7-floor condominium building
with a deck roof and 2 levels above the deck roof,
as stated in the Master Deed, at Paseo De Roxas,
Makati City with a unit on the roof deck and 2
levels above said unit called Concession 2 and
Concession 3. Concession 3 was bought by
Leviste Management System (Petitioner).
2. Petitioner sought to build another unit called
Concession 4 on top of Concession 3 and was
able to secure a buiding permit for its
construction. However, Legaspi Towers 200 Inc.
(Respondent) sent a notice to Petitioner that its
construction was illegal but the latter did not heed
such. Petitioner filed a writ of mandatory
injunction against Respondent.
. own the works, sowing or planting, after
1 136 SCRA 475
In Depra, the court should determine:
1. The present fair price of the encroached area of the
land;
2. The amount of expenses spent in building;
3. The increase in value the area may have acquired by
reason of the building;
4. Whether the value of the build land is considerably
more than that of the land build thereon.
3. The RTC affirmed Respondent wherein it found
application of Art. 448 of the Civil Code and Depra
v. Dumlao1. The “air space” above the unit
actually belongs to Respondent.
4. Respondent sought to demolish Concession 4 at
the expense of Petitioner. Respondent argued
that Petitioner should first get the consent of the
registered owners of the condominium project
before amendment of the Master Deed under
Sec. 4 of the Condominium Act. Petitioner argued
that there must be a determination of the required
values under Depra before Respondent can take
action.
5. RTC: Affirmed Respondent.
6. CA: Affirmed RTC Decision.
ISSUE(S): Whether Respondent can build Concession 4
on top of Petitioner’s condominium building.
HELD: No. Petitioner contravened the Master
Deed by adding a 3rd level above the roof deck and by
violating the Condominium Act and Respondent’s by-
laws.
RATIO:
• Instead of procuring the required consent of the
registered owners under Sec. 4 of the
Condominium Act or having Concession 4
approved by the members in a regular or special
meeting called for the purpose under
Respondent’s by-laws, Petitioner merely had an
internal agreement with the former president of
Respondent. This cannot bind corporations since
they can act only through their Board of Directors.
• Art. 448 of the Civil Code on builders in good faith
does not apply where there is contractual relation
between the parties. The RTC erred in
considering Art. 448 and Art. 546 of the Civil Code
in this case.
Article 448. The owner of the land on which
anything has been built, sown or planted in good
faith, shall have the right to appropriate as his
After determination of the above, the court shall grant the owner a
period of 15 days to exercise his option whether:
a. To appropriate the land by paying the amount of
expenses spent for building the same or the increase of
such area’s value by reason of the building or;
b. To oblige the builder in good faith to pay the price of
the said area.
26
 payment of the indemnity provided for in
articles 546 and 548, or to oblige the one who
built or planted to pay the price of the land,
and the one who sowed, the proper rent.
However, the builder or planter cannot be obliged
to buy the land if its value is considerably more
than that of the building or trees. In such case, he
shall pay reasonable rent, if the owner of the land
does not choose to appropriate the building or
trees after proper indemnity. The parties shall
agree upon the terms of the lease and in case of
disagreement, the court shall fix the terms
thereof. (361a)
Article 546. Necessary expenses shall be
refunded to every possessor; but only the
possessor in good faith may retain the thing until
he has been reimbursed therefor.
Useful expenses shall be refunded only to the
possessor in good faith with the same right of
retention, the person who has defeated him in the
possession having the option of refunding the
amount of the expenses or of paying the increase
in value which the thing may have acquired by
reason thereof. (453a)
The land belongs to a condominium corporation
wherein the builder, as a unit owner, is
considered a stockholder or member under Sec.
10 of the Condominium Act. The builder is already
in co-ownership with other unit owners as
members or stockholders of the condominium
corporation. Thus, the purchaser of a
condominium unit binds himself to a contract with
other unit owners.
• Art. 448 and 546 of the Civil Code on builders in
good faith are inapplicable in cases covered by
the Condominium Act where the owner of the land
and the builder are already bound by specific
legislation on the subject property and by contract
(the Master Deed and the By-Laws of the
condominium corporation).
LIM VS. MOLDEX LAND INC., et al.
G.R. No. 206038; January 25, 2017
Mendoza, J.
DOCTRINE: A non-member cannot be elected as a
director or officer of a corporation.
FACTS:
This case is a petition for review on certiorari assailing the
Decision of the RTC which dismissed the complaint
against the respondents for the annulment of the general
membership meeting of 1322 Roxas Boulevard
Condominium Corporation (Condocor), annulment of
election of Jeffrey Jaminola, Edgardo Macalintal, Joji
Milanes, and Clothilda Roman, as members of the BOD,
and for accounting.
Mary E. Lim is a registered unit owner of 1322 Golden
Empire Tower, a condominium project of Moldex Land,
Inc. (Moldex), a real estate company engaged in the
construction and development of high-end condominium
projects and in the sale of the units thereof to the public.
Condocor, a non-stock and non-profit corporation, is the
registered condominium corporation for the Golden
Empire Tower. Lim, as a unit owner of Golden Empire
Tower, is a member of Condocor.
On July 21, 2012 Condocor held its annual general
membership meeting. Moldex became a member of
Condocor on the basis of its ownership of the 220 unsold
units in the Golden Empire Tower. During the meeting, an
existence of a quorum was declared even though only 29
of the 108 unit buyers were present. Lim objected to the
validity of the meeting but was denied, and Lim and all
other unit owners, except for one, walked out of the
meeting. Nonetheless, the individual respondents and the
other unit owners proceeded with the meeting and elected
the new members of the BOD. All four individual
respondents (Jaminola, Macalintal, Milanes and Roman)
were voted as members of the board, together with other
3 members, whose election was conditioned on their
subsequent confirmation.
Lim filed an election protest before the RTC. The RTC
ruled in favor of the respondents and held that the
presence or absence of a quorum in the subject meeting
was determined on the basis of the voting rights of all the
units owned by the members in good standing. Lim filed
the present petition claiming that the respondents, who
are non-unit buyers, are not entitled to be members of the
BOD because they are non-unit buyers because a
condominium corporation, being an association of
homeowners, must be composed of actual unit buyers or
residents of the condominium project. Lim further alleged
that the ownership of Moldex was only in the nature of an
owner-developer and only for the sole purpose of selling
the units.
ISSUES:
1. Whether the membership meeting is valid; and
27
 2. Whether Moldex is considered a member of
Condocor.
HELD:
1. No. The July 21, 2012 membership meeting was
not valid. Any act or transaction made during a
meeting without quorum is rendered of no force and
effect, thus, not binding on the corporation or
parties concerned. Sec. 52 of the Corporation Code
provides that “Unless otherwise provided for in this
Code or in the by-laws, a quorum shall consist of
the stockholders representing a majority of the
outstanding capital stock or a majority of the
members in the case of non-stock corporations.”
Moldex is a member of Condocor. Respondents are
correct asserting in that a registered owner of a unit
in a condominium project or the holders of duly
issued condominium certificate of title,
automatically becomes a member of the
condominium corporation, relying on Sections 2
and 10 of the Condominium Act, the Master Deed
and Declaration of Restrictions and the By-Laws of
Condocor.
Nonetheless, the quorum during the meeting
should have been majority of Condocor's members
in good standing. Accordingly, there was no quorum
during the meeting considering that only 29 of the
108 unit buyers were present. As there was no
quorum, any resolution passed during the said
meeting was null and void and, not binding upon the
corporation or its members.
2. Yes. Moldex is a member of Condocor.
Respondents are correct asserting in that a
registered owner of a unit in a condominium project
or the holders of duly issued condominium
certificate of title, automatically becomes a member
of the condominium corporation, relying on
Sections 2 and 10 of the Condominium Act, the
Master Deed and Declaration of Restrictions and
the By-Laws of Condocor.
In sum, the July 21, 2012 annual general
membership meeting of Condocor being null and
void, all acts and resolutions emanating therefrom
are likewise null and void.
ISSUE:
Whether or not there has been a quorum.
Whether or not the resolutions and the election are valid.
RULING:
There has been no quorum. There was no valid meeting
thus the election of the respondents was invalid.
Not all those who attended are not members since they
are not condominium owners.
Thus, law and jurisprudence dictate that ownership of a
unit entitles one to become a member of a condominium
corporation. 1 The Condominium Act does not provide a
specific mode of acquiring ownership. Thus, whether one
becomes an owner of a condominium unit by virtue of sale
or donation is of no moment.
It is erroneous to argue that the ownership must result
from a sale transaction between the owner-developer and
the purchaser. Such interpretation would mean that
persons who inherited a unit, or have been donated one,
and properly transferred title in their names cannot
become members of a condominium corporation
Thus being non-members, the respondents cannot be
elected.
Section 23. The Board of Directors or Trustees. – Unless
otherwise provided in this Code, the corporate powers of
all corporations formed under this Code shall be
exercised, all business conducted and all property of such
corporations controlled and held by the board of directors
or trustees to be elected from among the holders of
stocks, or where there is no stock, from among the
members of the corporation, who shall hold office for one
(1) year until their successors are elected and qualified.
Every director must own at least one (1) share of the
capital stock of the corporation of which he is a director,
which share shall stand in his name on the books of the
corporation. Any director who ceases to be the owner of
at least one (1) share of the capital stock of the
corporation of which he is a director shall thereby cease
to be a director. Trustees of non-stock corporations must
be members thereof. A majority of the directors or trustees
of all corporations organized under this Code must be
residents of the Philippines.
This rule was reiterated in Section 92 of the Corporation
Code, which states:
Section 92. Election and term of trustees. – x x x No
person shall be elected as trustee unless he is a member
of the corporation. x x x
While Moldex may rightfully designate proxies or
representatives, the latter, however, cannot be elected as
directors or trustees of Condocor. First, the Corporation
Code clearly provides that a director or trustee must be a
member of record of the corporation. Further, the power
of the proxy is merely to vote. If said proxy is not a
member in his own right, he cannot be elected as a
director or proxy.
28
JOSEPH HARRY WALTER POOLE-BLUNDEN V.
UNION BANK OF THE PHILIPPINES
G.R. NO. 205838, 29 NOVEMBER 2017
LEONEN, J:
FACTS: Poole-Blunden (petitioner) came across an
advertisement for public auction of certain properties
placed by Union Bank in the Manila Bulletin sometime in
March 2001. One of these properties was Unit 2-C of T-
Tower Condominium located at Makati City. The
condominium unit was acquired by UnionBank through
forclosure proceedings.
A week prior to the auction, petitioner visited the
unit for inspection. He found that the unit had an irregular
shape, but didn’t doubt the unit’s area as advertised, the
ceiling in a bad condition, and the unit needed substantial
repairs to be habitable. On the day of the auction, he also
inspected the Master Title of the project owner to the
condominium. Petitioner won the bid and he entered to a
Contract to Sell with UnionBank. He started occupying the
unit in June 2001 and by July 2003, he was able to fully
pay for the unit, paying a total amount of P
3,257,142.49.00.
Petitioner decided to construct two additional
bedrooms in the unit. He noticed apparent problems in its
dimensions. He took a rough measurement and found
that the floor area was just 70 sqm, not 95 sqm as
advertised. He got in touch with an officer of UnionBank
to raise the matter, but no action was taken. He then wrote
to Unionbank to inform them of the discrepancy and asked
for the rescission of the Contract to Sell, along with the
refund of the amounts he had paid. UnionBank replied
that upon inquiring with HLURB, the Homeowners’s
Association of T-Tower, and its appraisers, the unit was
confirmed to be 95 sqm inclusive of the terrace and the
comon areas surrounding it. The petitioner was not
satisfied because according to the Master Title, “boundary
of each unit are the interior surfaces of the perimeter
walls, floors, ceilings, windows and doors thereof." He
hired an independent geodetic engineer, to survey the
unit and measure its actual floor. It was found out that the
actual area was only 74.4 sqm and gave a copy of the
certification to Unionbank. UnionBank explained that the
total area of the unit is based on the ratio allocation
maintenance cost submitted by the developer to HLURB
is 98 square meters (60 square meters as unit area and
38 square meters as share on open space). On the other
hand, the actual area thereof based on the measurements
made by its surveyor is 74.18 square meters which was
much higher than the unit area of 60 square meters that
was approved by HLURB. The petitioner was dissatisfied
with the said explanation.
Petitioner filed for the recission of the Contract to
Sell with Damages with the RTC of Makati and said court
dismissed the complaint. The CA affirmed the ruling of the
RTC stating that the sale was made on a "as-is-where-is"
basis as indicated in their contract. Thus, the petitioner
supposedly waived any errors in the bounds or
description of the unit. With the denial of his Motion for
Reconsideration, he filed for a petition to the Supreme
Court stating that: there is a vitiation of his consent as to
the object of the sale and he charges UnionBank with
fraud since it failed to disclose to him that the advertised
95 square meters was inclusive of common areas. Thus,
the Contract to Sell may be voided and that UnionBank is
liable for breach of warranty despite the "as-is-where-is"
clause in the Contract to Sell.
ISSUE: Whether or not UnionBank committed such a
degree of fraud that would entitle the petitoner to the
voiding of the Contract to Sell the said condominium unit
for his failure to disclose that the 95 sqm as advetised
already included common areas.
HELD: Yes. Respondent's insistence on how common
spaces should be included in reckoning the Unit's total
area runs afoul of how Republic Act No. 4726, otherwise
known as the Condominium. Section 3(b) of the
Condominium Act defines a condominium unit, as follows:
"Unit" means a part of the condominium project
intended for any type of independent use or ownership,
including one or more rooms or spaces located in one or
more floors (or part or parts of floors) in a building or
buildings and such accessories as may be appended
thereto.
Section 6(a) of the Condominium Act specifies the
reckoning of a condominium unit's bounds. It also
specifies that areas of common use "are not part of the
unit":
The boundary of the unit granted are the interior
surfaces of the perimeter walls, floors, ceilings, windows
and doors thereof. The following are not part of the unit
bearing walls, columns, floors, roofs, foundations and
other common structural elements of the building; lobbies,
stairways, hallways, and other areas of common use.
Thus, the unit sold to petitioner was deficient in
relation to its advertised area. This advertisement having
been made by respondent, it is equally settled there was
a falsity in the declarations made by respondent prior to,
and with the intention of enticing buyers to the sale.
Petitioner's contention on how crucial the
dimensions and area of the Unit are to his decision to
proceed with the purchase is well-taken. The significance
of space and dimensions to any buyer of real property is
plain to see. This is particularly significant to buyers of
condominium units in urban areas, and even more so in
central business districts, where the scarcity of space
drives vertical construction and propels property values.
The defense of "as-is-where-is" terms of the
purchase is untenable. First, a stipulation absolving a
seller of liability for hidden defects can only be invoked by
a seller who has no knowledge of hidden defects.
Respondent here knew that the Unit's area, as reckoned
in accordance with the Condominium Act, was not 95
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square meters. Second, an as-is-where-is stipulation can
only pertain to the readily perceptible physical state of the
object of a sale. It cannot encompass matters that require
specialized scrutiny, as well as features and traits that are
immediately appreciable only by someone with technical
competence.
Thus, the Court ordered that the Contract to Sell
between petitioner and respondent be annulled, and
petitioner be refunded all the amounts he paid to
respondent in respect of the purchase of the Unit plus
damages.
Even the least effort on respondent's part could have very
easily confirmed the Unit's true area. Similarly, the most
cursory review of the Condominium Act would have
revealed the proper reckoning of a condominium unit's
area. Respondent could have exerted these most
elementary efforts to protect not only clients and innocent
purchasers but, most basically, itself. Respondent's
failure to do so indicates how it created a situation that
could have led to no other outcome than petitioner being
defrauded.

DOCTRINE:
A bank that wrongly advertises the area of a property
acquired through foreclosure because it failed to dutifully
ascertain the property's specifications is grossly negligent
as to practically be in bad faith making the sale voidable.

Banks are required to observe a high degree of diligence

in their affairs. This encompasses their dealings
concerning properties offered as security for loans. A
bank that wrongly advertises the area of a property
acquired through foreclosure because it failed to dutifully
ascertain the property's specifications is grossly negligent
as to practically be in bad faith in offering that property to
prospective buyers. Any sale made on this account is
voidable for causal fraud. In actions to void such sales,
banks cannot hide under the defense that a sale was
made on an as-is-where-is basis. As-is-where-is
stipulations can only encompass physical features that
are readily perceptible by an ordinary person possessing
no specialized skills.

Reliance on Section 12's as-is-where-is stipulation is

misplaced for two (2) reasons. First, a stipulation
absolving a seller of liability for hidden defects can only
be invoked by a seller who has no knowledge of hidden
defects. Respondent here knew that the Unit's area, as
reckoned in accordance with the Condominium Act, was
not 95 square meters. Second, an as-is-where-is
stipulation can only pertain to the readily perceptible
physical state of the object of a sale. It cannot encompass
matters that require specialized scrutiny, as well as
features and traits that are immediately appreciable only
by someone with technical competence.

A seller is generally responsible for warranty against

hidden defects of the thing sold. As stated in Article 1561
of the New Civil Code. It is clear from the records that
respondent fully knew that the Unit's area, reckoned
strictly in accordance with the Condominium Act, did not
total 95 square meters.
Whether it was unaware of the unit's actual interior area;
or, knew of it, but wrongly thought that its area should
include common spaces, respondent's predicament
demonstrates how it failed to exercise utmost diligence in
investigating the Unit offered as security before accepting
it. This negligence is so inexcusable; it is tantamount to
bad faith.

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