July 1, 2015

G.R. No. 200558

CONSUELO V. PANGASINAN and ANNABELLA V. BORROMEO, Petitioners,

vs.
CRISTINA DISONGLOALMAZORA, RENILDA ALMAZORA-CASUBUAN, RODOLFO
CASUBUAN, SUSANA ALMAZORAMENDIOLA, CARLOS MENDIOLA, CECILIO ALMAZORA
and NENITA ALMAZORA, Respondents.

DECISION

MENDOZA, J.:

The present case demonstrates the legal principle that the law aids the vigilant, not those who
slumber on their rights. Vigilantibus, sed non dormientibus Jura subverniunt.

This is a petition for review on certiorari seeking to reverse and set aside the July 28, 2011
Decision  and the February 3, 2012 Resolution  of the Court of Appeals (CA), in CA-G.R. CV 84529,
1 2

which affirmed the June 29, 2004 Decision  of the Regional Trial Court, Branch 259, Parañaque
3

City (RTC) in Civil Case No. 96-0206, a case for damages.

The Facts

The subject property is a parcel of land with an area of 572 square meters located in Brgy. Sto.
Domingo, Biñan, Laguna. It was registered in the name of Aquilina Martinez (Aquilina) under
Transfer Certificate of Title (TCT) No. T-18729 by the Register of Deeds of Laguna on July 29,
1939.4

After the liberation of Manila from the Japanese military occupation in 1945, Aquilina and her
maternal grandmother, Leoncia Almendral (Leoncia), learned that their house on Zabala Street,
Tondo, Manila, was ruined by the war. To rebuild their house, they borrowed money from their
relative, Conrado Almazora (Conrado). Thus, their house was reconstructed. In return, Leoncia
entrusted to Contrado the owner’s duplicate copy of TCT No. T-18729 covering the subject property
in Biñan, Laguna. Consequently, Conrado and his family remained in the said property.

Following the death of Aquilina on July 19, 1949, the title of the subject property was transferred to
Aurora Morales-Vivar (Aurora), as her sole heir. Accordingly, TCT No. T-35280 was issued in the
name of Aurora  after TCT No. T-18729 was cancelled. On February 7, 1972, Conrado passed
5

away.

Sometime in 1994, Aurora learned from Cristina Almazora (Cristina), the widowed spouse of
Conrado, that the title of the subject property had long been transferred in the name of Conrado and
that the subject property had been sold to Fullway Development Corporation (Fullway) by the heirs
of Conrado in consideration of P4,000,000.00. 6

Aurora was shocked to learn that the subject property was already transferred to Conrado and sold
for a meager amount. On October 30, 1995, she sent a letter to the heirs of Conrado demanding the
delivery of the payment they received for the sale of the subject property; but it was unheeded.
On May 9, 1996, Aurora together with her husband, Arturo, filed a complaint for damages  against7

Cristina and the other heirs of Conrado (respondents) before the RTC. They contended that the
owner’s duplicate copy of TCT No. T-18729 was only given to Conrado for safekeeping. The
complaint, however, admitted that the family of Conrado had been staying on, and using, the subject
property since 1912 with the permission and generosity of Aquilina and Leoncia. 8

Aurora asserted that, through the years, she repeatedly asked Conrado to return the owner’s copy of
the title but the latter procrastinated, giving all kinds of excuses, until he died in 1972; that thereafter,
Aurora asked Cristina for the copy of the title but the latter also ignored her request; that the
subsequent sale of the subject property to Fullway was without Aurora’s authorization, and, thus, the
payment received by respondents for the sale of the subject property should be turned over to her;
and that she prayed for moral and exemplary damages. 9

On June 24, 1996, respondents filed their answer with compulsory counterclaim. They countered
that the subject property was properly transferred to Conrado under TCT No. 35282, and, thereafter,
in the names of the heirs of Conrado under TCT No. T-114352. Respondents averred that the
imputation of fraud on the part of Conrado in the registration of the subject property was baseless
and this assertion of fraud was not transmissible from Conrado to his heirs, who merely acquired the
property through succession. 10

Respondents raised some special and affirmatives defenses, among others, that the complaint
stated no cause of action and was barred by prescription. A preliminary hearing for the said
defenses was set by the RTC.  In the Order,  dated May 27, 1999, the RTC ruled that the complaint
11 12

stated a cause of action.

Respondents filed a petition for certiorari   to assail the said interlocutory order of the RTC before
13

the CA. In its Decision,  dated February 24, 1999, the CA denied the same and held that the
14

complaint stated a cause of action, which was an action for damages arising from fraud committed
by Conrado, as trustee, against Aurora, as cestui que trust. The CA further held that the complaint,
on its face, did not show that the action had prescribed.

Meanwhile, the RTC continued the proceedings and set the case for trial on the merits. After the
parties adduced their respective pieces of evidence, the RTC required them to submit their
memoranda. Only respondents filed a memorandum. 15

The RTC Ruling

In its Decision, dated June 29, 2004, the RTC dismissed the complaint. The trial court held that, after
a thorough evaluation of the records, Aurora miserably failed to prove her right to the subject
property. It explained that even if Aurora had a claim on the subject property, she was guilty of
laches. For many years, Aurora slept on her right over the questioned property and failed to exhaust
all means, legal or administrative, to retrieve what was rightfully hers at the earliest possible time.

The RTC determined that Conrado was able to transfer the title of the subject property in his name
on June 17, 1965 by virtue of a document denominated as "Adjudication and Absolute Sale of a
Parcel of Registered Land,"  dated January 9, 1949, signed by Aurora and her husband. The
16

signatures of Aurora and her husband, affixed on the deed of sale, were not properly controverted by
her. The trial court found that her allegations of repeated pleas to Conrado to return the copy of the
title deserved scant consideration. It concluded that Aurora was not entitled to damages because
there were no clear and cogent grounds to award the same. The decretal portion of the decision
reads:
WHEREFORE, premises considered, plaintiffs having failed to prove its case for damages, the same
is hereby ordered DISMISSED for lack of merit.

SO ORDERED. 17

Aggrieved, Aurora appealed to the CA. On June 4, 2009, the children of Aurora, namely, Consuelo
V. Pangasinan, Lucio M. Vivar and Annabella V. Borromeo (petitioners), filed a motion for
substitution of party  after her death on March 26, 2008. In its Resolution,  dated July 15, 2010, the
18 19

CA granted the motion.

The CA Ruling

In the assailed Decision, dated July 28, 2011, the CA denied the appeal of petitioners. It held that it
took Aurora more than 50 years to act on Conrado’s withholding of the title covering the subject
property. As early as 1945, the title was already in the possession of Conrado. The CA ruled that
petitioners were barred by laches as Aurora should have been impervious in asserting her
ownership and made judicial demands to return the title and the property.

The appellate court added that even on the aspect of prescription of actions, the case would not
prosper either. It explained that the prescriptive period to recover property obtained through fraud or
mistake giving rise to an implied trust under Article 1456 of the Civil Code was 10 years, pursuant to
Article 1144. This 10-year prescriptive period began from the time the land was registered on June
17, 1965. Accordingly, Aurora had only until June 17, 1975 within which to file her action. Evidently,
the suit was commenced only on May 12, 1996, beyond its prescription period. The dispositive
portion of the decision states:

WHEREFORE, premises considered, the instant petition is DENIED and the Decision dated June
29, 2004 of the Regional Trial Court of Parañaque City, Branch 259 in Civil Case No. 96-0206 is
hereby AFFIRMED.

SO ORDERED. 20

Petitioners moved for reconsideration, but their motion was denied by the CA in the assailed
Resolution, dated February 3, 2012.

Hence, this petition, raising the following

ISSUES

THE COURT OF APPEALS GRAVELY ERRED IN AFFIRMING THE DECISION OF THE LOWER
COURT DISMISSING THE COMPLAINT FOR DAMAGES FILED BY AURORA MORALESVIVAR,
WHICH DECISIONS ARE ALL CONTRARY TO LAW;

II

THE COURT OF APPEALS SERIOUSLY ERRED IN NOT RULING THAT THE ACQUISITION OF
CONRADO ALMAZORA, RESPONDENTS’ PREDECESSOR-IN-INTEREST, OF THE SUBJECT
PROPERTY, IS INVALID AND PRODUCED NO EFFECT WHATSOEVER BECAUSE NOT ALL
THE ELEMENTS OF LACHES, AS TO DEPRIVE AURORA MORALES-VIVAR OF HER
OWNERSHIP, ARE PRESENT IN THE CASE AT BAR. 21

Petitioners assert that they are not guilty of laches. When Aurora was told that the subject property
was already in the name of Conrado in April 1994, she immediately filed a complaint for damages on
May 2, 1996. Petitioners also claim that prescription is not a valid defense to defeat the title of
Aurora. Section 47 of Presidential Decree (P.D.) No. 1529 states that no title to registered land in
derogation of the title of the registered owner shall be acquired by prescription or adverse
possession.

On September 24, 2012, respondents filed their Comment,  arguing that petitioners’ assertions were
22

tenuous. Aurora slept on her rights for more than 50 years, impervious in asserting her ownership of
the subject property, thereby losing the same by laches.

On December 11, 2012, petitioners filed their Reply,  claiming that the CA observed that
23

respondents might have manipulated the said title to their benefit and advantage. Respondents’
hands were unclean because of their bad faith and misrepresentation.

The Court’s Ruling

The petition is bereft of merit.

The petition raises

questions of fact

As a general rule, the Court’s jurisdiction in a Rule 45 petition is limited to the review of pure
questions of law. A question of law arises when the doubt or difference exists as to what the law is
on a certain state of facts. Negatively put, Rule 45 does not allow the review of questions of fact. A
question of fact exists when the doubt or difference arises as to the truth or falsity of the alleged
facts.
24

Petitioners challenge the findings of laches, prescription and lack of bad faith by the CA. To answer
these questions, the Court must review the records to determine whether the lower courts properly
appreciated the evidence in concluding its findings. Clearly, the questions raised are factual. On this
ground alone, the present petition under Rule 45 is dismissible. In the interest of substantial justice,
however, the Court deems it proper to reevaluate the records.

Petitioners are barred by

laches

Laches is defined as the failure or neglect for an unreasonable and unexplained length of time to do
that which, by exercising due diligence, could or should have been done earlier; it is negligence or
omission to assert a right within a reasonable time, warranting a presumption that the party entitled
to assert it either has abandoned it or declined to assert it. 25

The principle of laches 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.  The time-honored rule anchored on public policy is that relief will be
26

denied to a litigant whose claim or demand has become "stale," or who has acquiesced for an
unreasonable length of time, or who has not been vigilant or who has slept on his rights either by
negligence, folly or inattention. In other words, public policy requires, for peace of society, the
discouragement of claims grown stale for non-assertion; thus laches is an impediment to the
assertion or enforcement of a right which has become, under the circumstances, inequitable or
unfair to permit.
27

The four (4) elements of laches, as first prescribed by this Court in Go Chi Gun v. Co Cho  are as
28

follows:

(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 for which the complaint seeks a remedy;

(2) delay in asserting the complainant’s rights, the complainant having had knowledge or
notice, of the defendant’s conduct and having been afforded an opportunity to institute a 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. 29

In the case at bench, the CA correctly held that all the elements of laches were present. First, Aurora
and her family entrusted to Conrado the owner’s duplicate of the certificate of title of the subject
property in 1945. In their complaint, petitioners even admitted that Conrado’s family had been
staying in the subject property since 1912.  Second, it took five decades, from 1945 to 1996, before
30

Aurora and petitioners decided to enforce their right thereon. Third, respondents who lived all their
lives in the disputed property apparently were not aware that Aurora would one day come out and
claim ownership thereon. Fourth, there was no question that respondents would be prejudiced in the
event that the suit would be allowed to prosper. 1avvphi1

The contention of petitioners that they were not in delay in claiming their rights over the subject
property is specious. For 50 years, Aurora and her heirs did not take any legal step to uphold their
claim over the subject property, despite being fully aware that Conrado and his family were
occupying the same for a very long time. Even petitioner Consuelo Vivar- Pangasinan testified that
Conrado had been using the property for 30 years  and that Aurora had never shown her any
31

evidence of ownership of the property. 32

In their complaint, Aurora claimed that she repeatedly reminded Conrado to return the copy of the
title. This, however, is a self-serving allegation without any evidentiary substantiation. The two
belated demand letters, dated October 30, 1995 and March 5, 1996, sent by Aurora’s lawyer before
the institution of the present action, are the only tangible assertions of their claim to the
property.  Indeed, not a scintilla of proof was presented by Aurora and her heirs to establish that, for
33

50 years, they actively manifested to reclaim the title and possession of the subject property.

A person, endowed with properties and entitlements, but chose to lie quietly as decades passed by,
watching his property wither away, allowing innocent bystanders to pick the fruits of his unguarded
trees, instead of safeguarding his rights through the accessibly and necessary legal means, does not
deserve the protection of equity. The law aids the vigilant, not those who slumber on their rights.

The action has prescribed

On the basis of prescription of actions, the pending petition must also be denied. Petitioners argue
that prescription shall not lie against their action because a registered land under Section 47 of P.D.
No. 1529 cannot be acquired through prescription.  The argument is patently erroneous.
34

There are two kinds of prescription provided in the Civil Code. One is acquisitive, that is, the
acquisition of a right by the lapse of time as expounded in paragraph 1, Article 1106.  Acquisitive
35

prescription is also known as adverse possession and usucapcion. The other kind is extinctive
prescription whereby rights and actions are lost by the lapse of time as defined in paragraph 2,
Article 1106 and Article 1139.  Another name for extinctive prescription is litigation of action. These
36

two kinds of prescription should not be interchanged. 37

In a plethora of cases,  the Court has held that Section 47 of P.D. No. 1529 covers acquisitive
38

prescription. A registered land therein can never be acquired by adverse possession. In the case at
bench, however, it was extinctive prescription, and not acquisitive prescription, which barred the
action of petitioners. As the CA correctly held, the action must fail, not because respondents
adversely occupied the property, but because petitioners failed to institute their suit within the
prescriptive period under Article 1144 of the Civil Code.

To determine the applicable period of extinctive prescription, the nature and circumstances of the
case should be considered. According to petitioners, the owner’s duplicate certificate of title was
given to Conrado for safekeeping in 1945. Allegedly, Conrado employed fraud and bad faith when
he drafted the Adjudication and Absolute Sale of a Parcel of Registered Land  on January 9, 1949,
39

and transferred the title of the land to his name with the issuance of TCT No. 35282  on June 17,
40

1965; and because of the purported fraud committed by Conrado against petitioners, an implied
constructive trust was created by operation of law, with Conrado as trustee and Aurora as cestui que
trust.

Constructive trusts are created by the construction of equity in order to satisfy the demands of justice
and prevent unjust enrichment.  Article 1456 of the Civil Code provides that a person acquiring
41

property through fraud becomes, by operation of law, a trustee of an implied trust for the benefit of
the real owner of the property.  It is now well-settled that the prescriptive period to recover property
42

obtained by fraud or mistake, giving rise to an implied trust under Article 1456 of the Civil Code, is 10
years pursuant to Article 1144.  The prescriptive period to enforce the constructive trust shall be
43

counted from the alleged fraudulent registration or date of issuance of the certificate of title over the
property.  The ten-year prescriptive period applies only if there is an actual need to reconvey the
44

property as when the plaintiff is not in possession of the property.45

In this case, the ten-year prescriptive period is squarely applicable because Conrado and his family,
not petitioners, were in possession of the property. The subject property was registered in the name
of Conrado on June 17, 1965, and this should be the starting point of the ten-year period.
Petitioners, thus, had until June 17, 1975 to enforce the implied trust and assert their claim over the
land. As properly held by the CA, petitioners belatedly instituted their judicial claim over the land on
May 9, 1996. Indeed, with the lapse of the prescriptive period to file an action, petitioners could no
longer seek relief from the courts.

Fraud was not proven

Granting, for the sake of argument, that the present case was not barred by laches and had not
prescribed, it must still fail on its merits. The basis of the action for damages of petitioners would be
the fraud, bad faith and misrepresentation allegedly committed by Conrado in transferring the title of
the subject property to his name. Petitioners, however, drastically failed to prove the fact of fraud
with clear and convincing evidence.
Fraud must be proven by clear and convincing evidence and not merely by a preponderance
thereof.  Clear and convincing proof is more than mere preponderance, but not to extent of such
46

certainty as is required beyond reasonable doubt as in criminal cases.  The imputation of fraud in a
47

civil case requires the presentation of clear and convincing evidence. Mere allegations will not
suffice to sustain the existence of fraud. The burden of evidence rests on the part of the plaintiff or
the party alleging fraud.
48

Here, the Adjudication and Absolute Sale of a Parcel of Registered Land, which was signed by
Aurora and her husband, transferred the ownership of the subject property from Aurora to Conrado.
Petitioners, however, failed to assail the validity of such deed. As written by the RTC, petitioners
could have questioned the authenticity of the document and submitted the same to the National
Bureau of Investigation for comparison of the signatures. This, they failed to do.49

In fine, the Adjudication and Absolute Sale of a Parcel of Registered Land, being a notarized
document, enjoys the presumption of regularity. Even assuming that Conrado truly employed fraud,
no proof was presented that respondents, as heirs of Conrado, were in privy and had knowledge of
the misrepresentations. In the absence of evidence of fraud, the transfer to Conrado of the title of the
subject property, and the subsequent transfer to respondents by virtue of succession,  must be
50

upheld.

Even on the subject of ownership, petitioners failed to substantiate their claim. Petitioners had
nothing, other than their bare allegations, that they continuously owned the subject property. For
decades, petitioners lacked the possession and interest to 'recover the subject property. The trial
court even noted that petitioners could not present a single tax declaration receipt as an indicia of
their ownership. Based on the foregoing, petitioners are certainly not entitled to damages on the
basis of their misplaced claim of ownership over the subject property.

WHEREFORE, the petition is DENIED. The July 28, 2011 Decision and the February 3, 2012
Resolution of the Court of Appeals in CA-G.R. CV No. 122153 are AFFIRMED in toto.

SO ORDERED.

JOSE CATRAL MENDOZA

Associate Justice

WE CONCUR:

ANTONIO T. CARPIO
Associate Justice
Chairperson

LUCAS P. BERSAMIN* MARIANO C. DEL CASTILLO

Associate Justice Associate Justice

MARVIC M.V.F. LEONEN

Associate Justice

ATTESTATION

I attest that the conclusions in the above Decision had been reached in consultation before the case
was assigned to the writer of the opinion of the Court's Division.
ANTONIO T. CARPIO
Associate Justice
Chairperson, Second Division

CERTIFICATION

Pursuant to Section 13, Article VIII of the Constitution and the Division Chairperson's Attestation, I
certify that the conclusions in the above Decision had been reached in consultation before the case
was assigned to the writer of the opinion of the Court's Division.

MARIA LOURDES P. A. SERENO

Chief Justice

Footnotes

* Designated Acting Member in lieu of Associate Justice Arturo D. Brion, per Special Order
No. 2079, dated June 29, 2015.

 Penned by Associate Justice Samuel H. Gaerlan with Associate Justice Rosmari D.

1

Carandang and Associate Justice Ramon R. Garcia, concurring; rollo, pp. 17-24.

2
 Id. at 26-27

3
 Penned by Judge Zosimo V. Escano; CA rollo, pp. 55-63.

4
 Records, Vol. I, p. 7.

5
 Records, Vol. II, p. 673.

6
 Id. at 663.

7
 Records, Vol. I, pp. 1-5.

8
 Id. at 2.

9
 Id. at 3-5.

10
 Id. at 18-28.

11
 Id. at 74.

12
 Id. at 192-194.

13
 Id. at 379-398.

 Penned by Associate Justice Romeo J. Callejo, Sr., with Associate Justice Fermin A.
14

Martin, Jr. and Associate Justice Mariano M. Umali, concurring; id. at 399-423.
  Records, Vol. II, p. 791.
15

 Id. at 667-668.
16

 CA rollo, p. 63.
17

 Id. at 132-133.
18

 Id. at 173-174.
19

 Rollo, p. 23.
20

 Id. at 10.
21

 Id. at 36-49.
22

 Id. at 65-68.
23

 Spouses Salvador v. Spouses Rabaja, G.R. No. 199990, February 4, 2015.

24

 Metropolitan Bank and Trust Company v. Centro Development Corporation, G.R. No.
25

180974, June 13, 2012, 672 SCRA 325, 338, citing Municipality of Carcar v. CFI Cebu, 204
Phil. 719, 723 (1982).

 Salandanan v. CA, 353 Phil. 114, 120 (1998).

26

 Heirs of Domingo Hernandez, Sr. v. Mingoa, Sr., 623 Phil. 303, 327 (2009), citing Isabela
27

Colleges, Inc. v. Heirs of Nieves Tolentino-Rivera, 397 Phil. 955, 969 (2000).

 96 Phil. 622, 637 (1954), citing 19 Am. Jur. 343-344

28

 Vda. De Tirona v. Encarnacion, 560 Phil. 650, 666 (2007).

29

 Records, Vol. I, p. 2.
30

 TSN, August 16, 1999, p. 13.

31

 Id. at 38-39.
32

 Records, Vol. II, pp. 619-620.

33

 Section 47. Registered land not subject to prescriptions. No title to registered land in
34

derogation of the title of the registered owner shall be acquired by prescription or adverse
possession.

 Art. 1106. By prescription, one acquires ownership and other real rights through the lapse
35

of time in the manner and under the conditions laid down by law.

In the same way, rights and conditions are lost by prescription.

  Art. 1139. Actions prescribe by the mere lapse of time fixed by law.
36

 Virtucio v. Alegarbes, G.R. No. 187451, August 29, 2012, 679 SCRA 412, 421.
37

 DBT Mar-Bay Construction, Inc. v. Panes, 612 Phil. 93 (2009); Feliciano v. Spouses

38

Zaldivar, 534 Phil. 280 (2006); and Spouses Ragudo v. Fabella Estate Tenants Association,
Inc., 503 Phil. 751 (2005).

 Records, Vol. II, pp. 667-668.

39

 Id. at 678-679.
40

 Juan Tong v. Go Tiat Kun, G.R. No. 196023, April 21, 2014, 722 SCRA 623, 635.
41

 Heirs of Narvasa, Sr. v. Victoriano, G.R. No. 182908, August 06, 2014, 732 SCRA 171,
42

182.

 Spouses Crisostomo v. Garcia, Jr., 516 Phil. 743, 753 (2006).

43

 See Estate of Margarita Cabacungan v. Laguio, 655 Phil. 366, 389 (2011)

44

 Brito Sr. v. Dinala, 653 Phil. 200, 211 (2010).

45

 ECE Realty and Development, Inc. v. Mandap, G.R. No. 196182, September 1, 2014, 734
46

SCRA 76, 83.

 Manalo v. Roldan-Confesor, 215 Phil. 808, 819 (1992).

47

 Tankeh v. Development Bank of the Philippines, G.R. No. 171428, November 11, 2013,
48

709 SCRA 19.

 CA rollo, p. 62.
49

 Records, Vol. II, pp. 665-666.

50