tutionally not qualified to own the subject land. CA declared that the reconstitution is void.

DIGEST 7: LAND TITLES AND DEEDS (CITIZENSHIP)

MATTHEWS VS TAYLOR, G.R. No. 164584, June 22, 2009

FACTS OF THE CASE: Respondent Benjamin A. Taylor, a British subject, married Joselyn C. Taylor, a 17-year old Filipina. While their
marriage was subsisting, Joselyn bought from Diosa M. Martin a 1,294 square-meter lot (Boracay property) situated at Manoc-Manoc, Boracay
Island, Malay, Aklan, for P129,000.00. The sale was allegedly financed by Benjamin. Joselyn and Benjamin, also using the latter’s funds,
constructed improvements thereon and eventually converted the property to a vacation and tourist resort known as the Admiral Ben Bow Inn . All
required permits and licenses for the operation of the resort were obtained in the name of Ginna Celestino, Joselyn’s sister.
However, Benjamin and Joselyn had a falling out, and Joselyn ran away with Kim Philippsen. Joselyn executed a Special Power of
Attorney (SPA) in favor of Benjamin, authorizing the latter to maintain, sell, lease, and sub-lease and otherwise enter into contract with third
parties with respect to their Boracay property. Joselyn as lessor and petitioner Philip Matthews as lessee, entered into an Agreement of Lease
involving the Boracay property for a period of 25 years, with an annual rental of  P12,000.00. Benjamin instituted an action for Declaration of
Nullity of Agreement of Lease with Damages against Joselyn and the petitioner since the agreement was executed without the former’s consent,
hence it was void. Benjamin claimed that his funds were used in the acquisition and improvement of the Boracay property, and coupled with the
fact that he was Joselyn’s husband, any transaction involving said property required his consent.
RTC declared the agreement null and void and considered the Boracay property as community property of Benjamin and Joselyn; thus, the
consent of the spouses was necessary to validate any contract involving the property. CA affirmed the decision of the RTC.

ISSUE: Whether or not an Agreement of Lease of a parcel of land entered into by a Filipino wife without the consent of her British husband valid.
YES

RULING: The court ruled that the trial and appellate courts both focused on the property relations of petitioner and respondent in light of the Civil
Code and Family Code provisions. They, however, failed to observe the applicable constitutional principles, which, in fact, are the more decisive.
Section 7, Article XII of the 1987 Constitution states: “Section 7. Save in cases of hereditary succession, no private lands shall be transferred or
conveyed except to individuals, corporations, or associations qualified to acquire or hold lands of the public domain. ” Aliens, whether individuals
or corporations, have been disqualified from acquiring lands of the public domain. Hence, by virtue of the aforecited constitutional provision, they
are also disqualified from acquiring private lands. The primary purpose of this constitutional provision is the conservation of the national
patrimony. Our fundamental law cannot be any clearer. The right to acquire lands of the public domain is reserved only to Filipino citizens or
corporations at least sixty percent of the capital of which is owned by Filipinos ISSUE: Whether or not Lee Liong predecessors-in-interest has the
qualification to own land in the Philippines. YES

RULING: The sale of the land in question was consummated sometime in March 1936, during the effectivity of the 1935 Constitution. Under the
1935 Constitution, aliens could not acquire private agricultural lands, save in cases of hereditary succession. Thus, Lee Liong, a Chinese citizen,
was disqualified to acquire the land in question.
The fact that the Court did not annul the sale of the land to an alien did not validate the transaction, for it was still contrary to the
constitutional proscription against aliens acquiring lands of the public or private domain. However, the proper party to assail the illegality of the
transaction was not the parties to the transaction. In sales of real estate to aliens incapable of holding title thereto by virtue of the provisions of
the Constitution both the vendor and the vendee are deemed to have committed the constitutional violation and being thus  in pari delictothe courts
will not afford protection to either party. The proper party to assail the sale is the Solicitor General. This was what was done in this case when the
Solicitor General initiated an action for annulment of judgment of reconstitution of title. While it took the Republic more than sixty years to assert
itself, it is not barred from initiating such action. Prescription never lies against the State.
Although ownership of the land cannot revert to the original sellers, because of the doctrine of pari delicto, the Solicitor General may
initiate an action for reversion or escheat ( power of a state to acquire title to property for which there is no owner ) of the land to the State , subject to
other defenses, as hereafter set forth. In this case, subsequent circumstances militate against escheat proceedings because the land is now in the
hands of Filipinos. The original vendee, Lee Liong, has since died and the land has been inherited by his heirs and subsequently their heirs,
petitioners herein. Petitioners are Filipino citizens, a fact the Solicitor General does not dispute.