SUPREME COURT DECISIONS

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FIRST DIVISION

G.R. No. 89783 February 19, 1992

MARIANO B. LOCSIN, JULIAN J. LOCSIN, JOSE B. LOCSIN, AUREA B. LOCSIN, MATILDE L. CORDERO, SALVADOR B. LOCSIN and MANUEL V. DEL ROSARIO, Petitioners, vs. THE HON. COURT OF APPEALS, JOSE JAUCIAN, FLORENTINO JAUCIAN, MERCEDES JAUCIAN ARBOLEDA, HEIRS OF JOSEFINA J. BORJA, HEIRS OF EDUARDO JAUCIAN and HEIRS OF VICENTE JAUCIAN, Respondents.

NARVASA, C.J.:chanrobles virtual law library

Reversal of the decision of the Court of Appeals in CA-G.R. No. CV-11186 - affirming with modification the judgment of the Regional Trial Court of Albay in favor of the plaintiffs in Civil Case No. 7152 entitled "Jose Jaucian, et al. v. Mariano B. Locsin, et al.," an action for recovery of real property with damages - is sought. in these proceedings initiated by petition for review on certiorari in accordance with Rule 45 of the Rules of Court.chanroblesvirtualawlibrarychanrobles virtual law library

The petition was initially denied due course and dismissed by this Court. It was however reinstated upon a second motion for reconsideration filed by the petitioners, and the respondents were required to comment thereon. The petition was thereafter given due course and the parties were directed to submit their memorandums. These, together with the evidence, having been carefully considered, the Court now decides the case.chanroblesvirtualawlibrarychanrobles virtual law library

First, the facts as the Court sees them in light of the evidence on record:chanrobles virtual law library

The late Getulio Locsin had three children named Mariano, Julian and Magdalena, all surnamed Locsin. He owned extensive residential and agricultural properties in the provinces of Albay and Sorsogon. After his death, his estate was divided among his three (3) children as follows:chanrobles virtual law library

(a) the coconut lands of some 700 hectares in Bual, Pilar, Sorsogon, were adjudicated to his daughter, Magdalena Locsin;chanrobles virtual law library

(b) 106 hectares of coconut lands were given to Julian Locsin, father of the petitioners Julian, Mariano, Jose, Salvador, Matilde, and Aurea, all surnamed Locsin;chanrobles virtual law library

(c) more than forty (40) hectares of coconut lands in Bogtong, eighteen (18) hectares of riceland in Daraga, and the residential lots in Daraga, Albay and in Legazpi City went to his son Mariano, which Mariano brought into his marriage to Catalina Jaucian in 1908. Catalina, for her part, brought into the marriage untitled properties which she had inherited from her parents, Balbino Jaucian and Simona Anson. These were augmented by other properties acquired by the spouses in the course of their union, ¹ which however was not blessed with children.chanroblesvirtualawlibrarychanrobles virtual law library

Eventually, the properties of Mariano and Catalina were brought under the Torrens System. Those that Mariano inherited from his father, Getulio Locsin, were surveyed cadastrally and registered in the name of "Mariano Locsin, married to Catalina Jaucian.'' ²chanrobles virtual law library

Mariano Locsin executed a Last Will and Testament instituting his wife, Catalina, as the sole and universal heir of all his properties. ³ The will was drawn up by his wife's nephew and trusted legal adviser, Attorney Salvador Lorayes. Attorney Lorayes disclosed that the spouses being childless, they had agreed that their properties, after both of them shall have died should revert to their respective sides of the family, i.e., Mariano's properties would go to his "Locsin relatives" (i.e., brothers and sisters or nephews and nieces), and those of Catalina to her "Jaucian relatives." ⁴chanrobles virtual law library

Don Mariano Locsin died of cancer on September 14, 1948 after a lingering illness. In due time, his will was probated in Special Proceedings No. 138, CFI of Albay without any opposition from both sides of the family. As directed in his will, Doña Catalina was appointed executrix of his estate. Her lawyer in the probate proceeding was Attorney Lorayes. In the inventory of her husband's estate ⁵ which she submitted to the probate court for approval, ⁶ Catalina declared that "all items mentioned from Nos. 1 to 33 are the private properties of the deceased and form part of his capital at the time of the marriage with the surviving spouse, while items Nos. 34 to 42 are conjugal." ⁷ chanrobles virtual law library

Among her own and Don Mariano's relatives, Doña Catalina was closest to her nephew, Attorney Salvador Lorayes, her nieces, Elena Jaucian, Maria Lorayes-Cornelio and Maria Olbes-Velasco, and the husbands of the last two: Hostilio Cornelio and Fernando Velasco. 8 Her trust in Hostilio Cornelio was such that she made him custodian of all the titles of her properties; and before she disposed of any of them, she unfailingly consulted her lawyer-nephew, Attorney Salvador Lorayes. It was Atty. Lorayes who prepared the legal documents and, more often than not, the witnesses to the transactions were her niece Elena Jaucian, Maria Lorayes-Cornelio, Maria Olbes-Velasco, or their husbands. Her niece, Elena Jaucian, was her life-long companion in her house.chanroblesvirtualawlibrarychanrobles virtual law library

Don Mariano relied on Doña Catalina to carry out the terms of their compact, hence, nine (9) years after his death, as if in obedience to his voice from the grave, and fully cognizant that she was also advancing in years, Doña Catalina began transferring, by sale, donation or assignment, Don Mariano's as well as her own, properties to their respective nephews and nieces. She made the following sales and donation of properties which she had received from her husband's estate, to his Locsin nephews and nieces:

EXHIBIT DATE PARTICULARS AREA/SQ.M. PRICE WITNESSES

23 Jan. 26, 1957 Deed of Absolute Sale in 962 P 481
favor of Mariano Locsin

1-JRL Apr. 7, 1966 Deed of Sale in favor of 430,203 P 20,000
Jose R. Locsin

1-JJL Mar. 22, 1967 Deed of Sale in favor of 5,000 P 1,000 Hostilio Cornello
Julian Locsin (Lot 2020) Helen M. Jaucian

1 Nov. 29, 1974 Deed of Donation in 26,509
favor Aurea Locsin,
Matilde L. Cordero
and Salvador Locsin

2 Feb. 4, 1975 Deed of Donation in 34,045
favor Aurea Locsin,
Matilde L. Cordero
and Salvador Locsin

3 Sept. 9, 1975 Deed of Donation in (Lot 2059)
favor Aurea Locsin,
Matilde L. Cordero
and Salvador Locsin

4 July 15, 1974 Deed of Absolute Sale in 1,424 Hostilio Cornelio
favor of Aurea B. Locsin Fernando Velasco

5 July 15, 1974 Deed of Absolute Sale in 1,456 P 5,750 Hostilio Cornelio
favor of Aurea B. Locsin Elena Jaucian

6 July 15, 1974 Deed of Absolute Sale in 1,237 P 5,720 - ditto -
favor of Aurea B. Locsin

7 July 15, 1974 Deed of Absolute Sale in 1,404 P 4,050 - ditto -
favor of Aurea B. Locsin

15 Nov. 26, 1975 Deed of Sale in favor of 261 P 4,930 - ditto -
Aurea Locsin

16 Oct. 17, 1975 Deed of Sale in favor of 533 P 2,000 Delfina Anson
Aurea Locsin M. Acabado

17 Nov. 26, 1975 Deed of Sale in favor of 373 P 1,000 Leonor Satuito
Aurea Locsin Mariano B. Locsin

19 Sept. 1, 1975 Conditional Donation in 1,130 P 3,000 - ditto -
favor of Mariano Locsin

1-MVRJ Dec. 29, 1972 Deed of Reconveyance 1,5110.66 P 1,000 Delfina Anson
in favor of Manuel V. del (Lot 2155) Antonio Illegible
Rosario whose maternal
grandfather was Getulio
Locsin

2-MVRJ June 30, 1973 Deed of Reconveyance 319.34 P 500 Antonio Illegible
in favor of Manuel V. del (Lot 2155) Salvador Nical
Rosario but the rentals
from bigger portion of
Lot 2155 leased to Filoil
Refinery were assigned to
Maria Jaucian Lorayes
Corneliochanrobles virtual law library

Of her own properties, Doña Catalina conveyed the following to her own nephews and nieces and others:

EXHIBIT DATE PARTICULARS AREA/SQ.M. PRICE

2-JJL July 16, 1964 Deed of Sale in favor 5,000 P 1,000
Vicente Jaucian (lot 2020)
(6,825 sqm. when
resurveyed)

24 Feb. 12, 1973 Deed of Absolute Sale 100 P 1,000
in favor of Francisco M.
Maquiniana

26 July 15, 1973 Deed of Absolute Sale in 130 P 1,300
favor of Francisco
Maquiniana

27 May 3, 1973 Deed of Absolute Sale in 100 P 1,000
favor of Ireneo Mamia

28 May 3, 1973 Deed of Absolute Sale in 75 P 750
favor of Zenaida Buiza

29 May 3, 1973 Deed of Absolute Sale in 150 P 1,500
favor of Felisa Morjella

30 Apr. 3, 1973 Deed of Absolute Sale in 31 P 1,000
favor of Inocentes Motocinos

31 Feb. 12, 1973 Deed of Absolute Sale in 150 P 1,500
favor of Casimiro Mondevil

32 Mar. 1, 1973 Deed of Absolute Sale in 112 P 1,200
favor of Juan Saballa

25 Dec. 28, 1973 Deed of Absolute Sale in 250 P 2,500
of Rogelio Marticiochanrobles virtual law library

Doña Catalina died on July 6, 1977.chanroblesvirtualawlibrarychanrobles virtual law library

Four years before her death, she had made a will on October 22, 1973 affirming and ratifying the transfers she had made during her lifetime in favor of her husband's, and her own, relatives. After the reading of her will, all the relatives agreed that there was no need to submit it to the court for probate because the properties devised to them under the will had already been conveyed to them by the deceased when she was still alive, except some legacies which the executor of her will or estate, Attorney Salvador Lorayes, proceeded to distribute.chanroblesvirtualawlibrarychanrobles virtual law library

In 1989, or six (6) years after Doña Catalina's demise, some of her Jaucian nephews and nieces who had already received their legacies and hereditary shares from her estate, filed action in the Regional Trial Court of Legaspi City (Branch VIII, Civil Case No. 7152) to recover the properties which she had conveyed to the Locsins during her lifetime, alleging that the conveyances were inofficious, without consideration, and intended solely to circumvent the laws on succession. Those who were closest to Doña Catalina did not join the action.chanroblesvirtualawlibrarychanrobles virtual law library

After the trial, judgment was rendered on July 8, l985 in favor of the plaintiffs (Jaucian), and against the Locsin defendants, the dispositive part of which reads:

WHEREFORE, this Court renders judgment for the plaintiffs and against the defendants:chanrobles virtual law library

(1) declaring the, plaintiffs, except the heirs of Josefina J. Borja and Eduardo Jaucian, who withdrew, the rightful heirs and entitled to the entire estate, in equal portions, of Catalina Jaucian Vda. de Locsin, being the nearest collateral heirs by right of representation of Juan and Gregorio, both surnamed Jaucian, and full-blood brothers of Catalina;chanrobles virtual law library

(2) declaring the deeds of sale, donations, reconveyance and exchange and all other instruments conveying any part of the estate of Catalina J. Vda. de Locsin including, but not limited to those in the inventory of known properties (Annex B of the complaint) as null and void ab-initio;chanrobles virtual law library

(3) ordering the Register of Deeds of Albay and/or Legazpi City to cancel all certificates of title and other transfers of the real properties, subject of this case, in the name of defendants, and derivatives therefrom, and issue new ones to the plaintiffs;chanrobles virtual law library

(4) ordering the defendants, jointly and severally, to reconvey ownership and possession of all such properties to the plaintiffs, together with all muniments of title properly endorsed and delivered, and all the fruits and incomes received by the defendants from the estate of Catalina, with legal interest from the filing of this action; and where reconveyance and delivery cannot be effected for reasons that might have intervened and prevent the same, defendants shall pay for the value of such properties, fruits and incomes received by them, also with legal interest from the filing, of this casechanrobles virtual law library

(5) ordering each of the defendants to pay the plaintiffs the amount of P30,000.00 as exemplary damages; and the further sum of P20,000.00 each as moral damages; andchanrobles virtual law library

(6) ordering the defendants to pay the plaintiffs attorney's fees and litigation expenses, in the amount of P30,000.00 without prejudice to any contract between plaintiffs and counsel.chanroblesvirtualawlibrarychanrobles virtual law library

Costs against the defendants. ⁹chanrobles virtual law library

The Locsins appealed to the Court of Appeals (CA-G.R. No. CV-11186) which rendered its now appealed judgment on March 14, 1989, affirming the trial court's decision.chanroblesvirtualawlibrarychanrobles virtual law library

The petition has merit and should be granted.chanroblesvirtualawlibrarychanrobles virtual law library

The trial court and the Court of Appeals erred in declaring the private respondents, nephews and nieces of Doña Catalina J. Vda. de Locsin, entitled to inherit the properties which she had already disposed of more than ten (10) years before her death. For those properties did not form part of her hereditary estate, i.e., "the property and transmissible rights and obligations existing at the time of (the decedent's) death and those which have accrued thereto since the opening of the succession." ¹⁰ The rights to a person's succession are transmitted from the moment of his death, and do not vest in his heirs until such time. ¹¹ Property which Doña Catalina had transferred or conveyed to other persons during her lifetime no longer formed part of her estate at the time of her death to which her heirs may lay claim. Had she died intestate, only the property that remained in her estate at the time of her death devolved to her legal heirs; and even if those transfers were, one and all, treated as donations, the right arising under certain circumstances to impugn and compel the reduction or revocation of a decedent's gifts inter vivos does not inure to the respondents since neither they nor the donees are compulsory (or forced) heirs. ¹²chanrobles virtual law library

There is thus no basis for assuming an intention on the part of Doña Catalina, in transferring the properties she had received from her late husband to his nephews and nieces, an intent to circumvent the law in violation of the private respondents' rights to her succession. Said respondents are not her compulsory heirs, and it is not pretended that she had any such, hence there were no legitimes that could conceivably be impaired by any transfer of her property during her lifetime. All that the respondents had was an expectancy that in nowise restricted her freedom to dispose of even her entire estate subject only to the limitation set forth in Art. 750, Civil Code which, even if it were breached, the respondents may not invoke:

Art. 750. The donation may comprehend all the present property of the donor or part thereof, provided he reserves, in full ownership or in usufruct, sufficient means for the support of himself, and of all relatives who, at the time of the acceptance of the donation, are by law entitled to be supported by the donor. Without such reservation, the donation shall be reduced on petition of any person affected. (634a)

The lower court capitalized on the fact that Doña Catalina was already 90 years old when she died on July 6, 1977. It insinuated that because of her advanced years she may have been imposed upon, or unduly influenced and morally pressured by her husband's nephews and nieces (the petitioners) to transfer to them the properties which she had inherited from Don Mariano's estate. The records do not support that conjecture.chanroblesvirtualawlibrarychanrobles virtual law library

For as early as 1957, or twenty-eight (28) years before her death, Doña Catalina had already begun transferring to her Locsin nephews and nieces the properties which she received from Don Mariano. She sold a 962-sq.m. lot on January 26, 1957 to his nephew and namesake Mariano Locsin II. ¹³ On April 7, 1966, or 19 years before she passed away, she also sold a 43 hectare land to another Locsin nephew, Jose R. Locsin. ¹⁴ The next year, or on March 22, 1967, she sold a 5,000-sq.m. portion of Lot 2020 to Julian Locsin. ¹⁵chanrobles virtual law library

On March 27, 1967, Lot 2020 ¹⁶was partitioned by and among Doña Catalina, Julian Locsin, Vicente Jaucian and Agapito Lorete. ¹⁷ At least Vicente Jaucian, among the other respondents in this case, is estopped from assailing the genuineness and due execution of the sale of portions of Lot 2020 to himself, Julian Locsin, and Agapito Lorete, and the partition agreement that he (Vicente) concluded with the other co-owners of Lot 2020.chanroblesvirtualawlibrarychanrobles virtual law library

Among Doña, Catalina's last transactions before she died in 1977 were the sales of property which she made in favor of Aurea Locsin and Mariano Locsin in 1975. ¹⁸chanrobles virtual law library

There is not the slightest suggestion in the record that Doña Catalina was mentally incompetent when she made those dispositions. Indeed, how can any such suggestion be made in light of the fact that even as she was transferring properties to the Locsins, she was also contemporaneously disposing of her other properties in favor of the Jaucians? She sold to her nephew, Vicente Jaucian, on July 16, 1964 (21 years before her death) one-half (or 5,000 sq.m.) of Lot 2020. Three years later, or on March 22, 1967, she sold another 5000 sq.m. of the same lot to Julian Locsin. ¹⁹chanrobles virtual law library

From 1972 to 1973 she made several other transfers of her properties to her relatives and other persons, namely: Francisco Maquiniana, Ireneo Mamia, Zenaida Buiza, Feliza Morjella, Inocentes Motocinos, Casimiro Mondevil, Juan Saballa and Rogelio Marticio. ²⁰ None of those transactions was impugned by the private respondents.chanroblesvirtualawlibrarychanrobles virtual law library

In 1975, or two years before her death, Doña Catalina sold some lots not only to Don Mariano's niece, Aurea Locsin, and his nephew, Mariano Locsin
II, ²¹ but also to her niece, Mercedes Jaucian Arboleda. ²² If she was competent to make that conveyance to Mercedes, how can there be any doubt that she was equally competent to transfer her other pieces of property to Aurea and Mariano II?chanrobles virtual law library

The trial court's belief that Don Mariano Locsin bequeathed his entire estate to his wife, from a "consciousness of its real origin" which carries the implication that said estate consisted of properties which his wife had inherited from her parents, flies in the teeth of Doña Catalina's admission in her inventory of that estate, that "items 1 to 33 are the private properties of the deceased (Don Mariano) and forms (sic) part of his capital at the time of the marriage with the surviving spouse, while items 34 to 42 are conjugal properties, acquired during the marriage." She would have known better than anyone else whether the listing included any of her paraphernal property so it is safe to assume that none was in fact included. The inventory was signed by her under oath, and was approved by the probate court in Special Proceeding No. 138 of the Court of First Instance of Albay. It was prepared with the assistance of her own nephew and counsel, Atty. Salvador Lorayes, who surely would not have prepared a false inventory that would have been prejudicial to his aunt's interest and to his own, since he stood to inherit from her eventually.chanroblesvirtualawlibrarychanrobles virtual law library

This Court finds no reason to disbelieve Attorney Lorayes' testimony that before Don Mariano died, he and his wife (Doña Catalina), being childless, had agreed that their respective properties should eventually revert to their respective lineal relatives. As the trusted legal adviser of the spouses and a full-blood nephew of Doña Catalina, he would not have spun a tale out of thin air that would also prejudice his own interest.chanroblesvirtualawlibrarychanrobles virtual law library

Little significance, it seems, has been attached to the fact that among Doña Catalina's nephews and nieces, those closest to her: (a) her lawyer-nephew Attorney Salvador Lorayes; (b) her niece and companion Elena Jaucian: (c) her nieces Maria Olbes-Velasco and Maria Lorayes-Cornelio and their respective husbands, Fernando Velasco and Hostilio Cornelio, did not join the suit to annul and undo the dispositions of property which she made in favor of the Locsins, although it would have been to their advantage to do so. Their desistance persuasively demonstrates that Doña Catalina acted as a completely free agent when she made the conveyances in favor of the petitioners. In fact, considering their closeness to Doña Catalina it would have been well-nigh impossible for the petitioners to employ "fraud, undue pressure, and subtle manipulations" on her to make her sell or donate her properties to them. Doña Catalina's niece, Elena Jaucian, daughter of her brother, Eduardo Jaucian, lived with her in her house. Her nephew-in-law, Hostilio Cornelio, was the custodian of the titles of her properties. The sales and donations which she signed in favor of the petitioners were prepared by her trusted legal adviser and nephew, Attorney Salvador Lorayes. The (1) deed of donation dated November 19,
1974 ²³ in favor of Aurea Locsin, (2) another deed of donation dated February 4, 1975 ²⁴ in favor of Matilde Cordero, and (3) still another deed dated September 9, 1975 ²⁵ in favor of Salvador Lorayes, were all witnessed by Hostilio Cornelio (who is married to Doña Catalina's niece, Maria Lorayes) and Fernando Velasco who is married to another niece, Maria Olbes. ²⁶The sales which she made in favor of Aurea Locsin on July 15, 1974 ²⁷ were witnessed by Hostilio Cornelio and Elena Jaucian. Given those circumstances, said transactions could not have been anything but free and voluntary acts on her part.chanroblesvirtualawlibrarychanrobles virtual law library

Apart from the foregoing considerations, the trial court and the Court of Appeals erred in not dismissing this action for annulment and reconveyance on the ground of prescription. Commenced decades after the transactions had been consummated, and six (6) years after Doña Catalina's death, it prescribed four (4) years after the subject transactions were recorded in the Registry of Property, ²⁸ whether considered an action based on fraud, or one to redress an injury to the rights of the plaintiffs. The private respondents may not feign ignorance of said transactions because the registration of the deeds was constructive notice thereof to them and the whole world. ²⁹chanrobles virtual law library

WHEREFORE, the petition for review is granted. The decision dated March 14, 1989 of the Court of Appeals in CA-G.R. CV No. 11186 is REVERSED and SET ASIDE. The private respondents' complaint for annulment of contracts and reconveyance of properties in Civil Case No. 7152 of the Regional Trial Court, Branch VIII of Legazpi City, is DISMISSED, with costs against the private respondents, plaintiffs therein.chanroblesvirtualawlibrarychanrobles virtual law library

SO ORDERED.

Cruz, Griño-Aquino and Medialdea, JJ., concur.

Endnotes:

1 Exhibit S.chanrobles virtual law library

2 p. 3, Annex A, RTC Decision in Civil Case No. 7152.chanrobles virtual law library

3 Exhibit A.chanrobles virtual law library

4 p. 5, Ibid.chanrobles virtual law library

5 Exh. 20.chanrobles virtual law library

6 Exh. 20-A.chanrobles virtual law library

7 p. 4, Ibid.chanrobles virtual law library

8 p. 4, Ibid.chanrobles virtual law library

9 pp. 83-84, Rollo.chanrobles virtual law library

10 Art. 781, Civil Code; emphasis supplied.chanrobles virtual law library

11 Art. 777, Civil Code; Mijares vs. Nery, 3 Phil. 195; Uson v. Del Rosario, 92 Phil. 530; -Edades vs. Edades, 99 Phil. 675.chanrobles virtual law library

12 Art. 752, in relation to Arts. 1061, et seq., Civil Code.chanrobles virtual law library

13 Exh. 23.chanrobles virtual law library

14 Exh. 1-JRL.chanrobles virtual law library

15 Exh. 1-JJL.chanrobles virtual law library

16 Exh. 3-JJL.chanrobles virtual law library

17 Exhs. 1-JJL and 2-JJL.chanrobles virtual law library

18 Exhs. 16, 17 and 18.chanrobles virtual law library

19 Exh. 1 JJL.chanrobles virtual law library

20 Exhs. 1, MVRJ, 2-MVRJ, 24-32.chanrobles virtual law library

21 Exhs. 16, 17 & 19.chanrobles virtual law library

22 Exhs. S-9 and S-10.chanrobles virtual law library

23 Exh. 1.chanrobles virtual law library

24 Exh. 2.chanrobles virtual law library

25 Exh. 3.chanrobles virtual law library

26 pp. 35-38, Rollo.chanrobles virtual law library

27 Exhs. 4 to 7.chanrobles virtual law library

28 Art. 1146, Civil Code; Alarcon vs. Bidin, 120 SCRA 390; Esconde vs. Barlongay, 152 SCRA 613.chanrobles virtual law library

29 Heirs of Maria Marasigan vs. IAC, 152 SCRA 152; Board of Liquidators, et al. vs. Roxas, 179 SCRA 809 (1989).