Villagonzalo v.

IAC
G.R. No. 71110, November 22, 1988
J. Regalado

Digest Author: June Vincent Ferrer III

Topic: Remedies for Protecting Property Rights – Extinctive Prescription

Petitioners: Paz Villagonzalo, Estela Villagonzalo, Aida Vilagonzalo, Herminia Villagonzalo, Gwendolyn
Villagonzalo, Jensine Villagonzalo and Leonila Villagonzalo
Respondents: IAC and Cecilia A. Villagonzalo

Case Summary: Juan purchased a lot and made it to appear that the sale was in the name of his daughter,
Cecilia. However, 13 years later, the heirs of Juan filed a complaint for reconveyance on the subject land. CFI
granted. IAC reversed. CA affirmed. Hence, this petition. The Court ruled that the right of action had already
prescribed because an action for reconveyance of real property to enforce an implied trust shall prescribe after
10 years.

Doctrine: An action for reconveyance of real property to enforce an implied trust shall prescribe after 10 years.
The 10-year period is counted from the date adverse title to the property is asserted by the possessor.

FACTS

• On February 22, 1961, Juan C. Villagonzalo purchased a lot of the Ormoc Cadastre from the Heirs of
Roman Matuguina
o Situated at Barrio Dolores, Municipality of Ormoc
o 97,213 sqm
o For P1,500

• However, it was made to appear that the sale was in the name of his daughter, Cecilia Villagonzalo
o Because Juan borrowed from her the sum of P500 to complete the full payment of the price of
the lot

• Thus, TCT was issued in the name of Cecilia as the registered owner

• 13 years later, the heirs of Juan filed a complaint for reconveyance on the subject land

• CFI granted
o Declared the lot as the conjugal property of Juan and his wife, Felicisima
o Ordered the cancellation of TCT in the name of Cecilia
o Ordered the Registry of Deeds to issue another TCT in the name of Juan and Felicisima who are
now deceased and survived by the present plaintiffs

• IAC reversed

• CA affirmed
o The right of action had already prescribed

• Hence, this petition.

Petitioners contend:

• Their action was seasonably filed because Cecilia’s registration of the land in her name was not a
repudiation of the implied trust created between her and their father
 ISSUES AND HELD

1. W/N the right of action had already prescribed – YES

RULE

• An action for reconveyance of real property to enforce an implied trust shall prescribe after 10 years

• The 10-year period is counted from the date adverse title to the property is asserted by the possessor

• An action to enforce an implied trust may be barred not only by prescription but also by laches
o Whether the trust is resulting or constructive, its enforcement may be barred by laches

APPLICATION

• When Cecilia obtained the TCT in her name, she thereby excluded the petitioners from the estate of their
deceased predecessor-in-interest
o Consequently, she set up a title to the land adverse to them

• The registration of the Deed of Sale with the Register of Deeds was constructive notice to the whole
world of Cecilia’s adverse claim to the property, thereby repudiating any fiduciary or trust relationship
involved

• In this case, that assertion of adverse title took place when the TCT was issued in the name of Ceciliaon
July 18, 1962
o Which consequently was a repudiation of the implied trust for the purpose of the statute of
limitations

• Moreover, there is other evidence to prove that Cecilia asserted the adverse title
o In 1961, Cecilia refused to give any share in the produce of the land to petitioners
o In 1963, she mortgaged the property in her own name
o In 1969, she leased the lot to Ramon Valera without the petitioners taking preventive or retaliatory
legal action