085 ALfredo v. Borras

085 SPOUSES GODOFREDO ALFREDO and
CARMEN LIMON ALFREDO, SPOUSES ARNULFO

SAVELLANO and EDITHA B. SAVELLANO,
DANTON D. MATAWARAN, SPOUSES DELFIN F.
ESPIRITU, JR. and ESTELA S. ESPIRITU and
ELIZABETH TUAZON, petitioners, vs. SPOUSES
ARMANDO BORRAS and ADELIA LOBATON
BORRAS, respondents.
G.R. No. 144225. June 17, 2003
TOPIC:
PONENTE: CARPIO, J.
FACTS:
AUTHOR:
NOTES: (if applicable)
Di ko gets kung ano yung rem issue ditto. Puro sales

yung issue.
A parcel of land is the subject of controversy in this case. The registered owners of the Subject Land were
petitioner spouses Alfredo.
The Spouses Alfredo mortgaged the subject land to the DBP for P7,000.00, and in order to pay their debt, the
petitioner Spouses sold the subject land to the respondent Spouses Borras for P15,000.00. The Spouses Borras
paid the loan and its interest and the balance is to be paid by the Spouses Alfredo, and they (Alfredos) delivered
the Owner's Duplicate Copy of OCT No. 284 to them (Borras).
Later, Borras discovered that the the Alfredos had re-sold portiions of the land to several persons. Borras filed an
adverse claim with the Register of Deeds of Bataan, and later did they knew that the Alfredos had secured a
duplicate copy of OCT No. 284, the tax declaration and the receipts of the reality.
The spouses Borras filed for specific performance against the Alfredos and the subsequent buyers. In their
answer, the spouses Alfredo and the Subsequent Buyers (collectively petitioners) argued that the action is
unenforceable under the Statute of Frauds. Petitioners pointed out that there is no written instrument evidencing
the alleged contract of sale over the Subject Land in favor of Armando and Adelia. Petitioners objected to
whatever parole evidence Armando and Adelia introduced or offered on the alleged sale unless the same was in
writing and subscribed by Godofredo. Petitioners asserted that the Subsequent Buyers were buyers in good faith
and for value. As counterclaim, petitioners sought payment of attorneys fees and incidental expenses.
TC- Ruled in favor of the Spouses Borras
CA- Affirmed TC decision.
ISSUE(S): Whether the sale is Enforceable? Yes
Whether the action is barred by prescription or laches? - NO
HELD: (YES/NO, and a short explanation)
RATIO:
In a petition for review on certiorari under Rule 45, this Court reviews only errors of law and not errors of facts.
[9] The factual findings of the appellate court are generally binding on this Court.[10] This applies with greater
force when both the trial court and the Court of Appeals are in complete agreement on their factual findings.[11]
In this case, there is no reason to deviate from the findings of the lower courts. The facts relied upon by the trial
and appellate courts are borne out by the record. We agree with the conclusions drawn by the lower courts from
these facts.
RE ENFORCEABILITY:
The Statute of Frauds provides that a contract for the sale of real property shall be unenforceable unless the
contract or some note or memorandum of the sale is in writing and subscribed by the party charged or his agent.
The existence of the receipt dated 11 March 1970, which is a memorandum of the sale, removes the transaction
from the provisions of the Statute of Frauds.

The Statute of Frauds applies only to executory contracts and not to contracts either partially or totally
performed. Thus, where one party has performed ones obligation, oral evidence will be admitted to prove the
agreement. In the instant case, the parties have consummated the sale of the Subject Land, with both sellers and
buyers performing their respective obligations under the contract of sale. In addition, a contract that violates the
Statute of Frauds is ratified by the acceptance of benefits under the contract. Alfredo spouses benefited from the
contract because they paid their DBP loan and secured the cancellation of their mortgage using the money given
by Borras. Alfredo also accepted payment of the balance of the purchase price.
Alfredo spouses cannot invoke the Statute of Frauds to deny the existence of the verbal contract of sale because
they have performed their obligations, and have accepted benefits, under the verbal contract. Borras spouses
have also performed their obligations under the verbal contract. Clearly, both the sellers and the buyers have
consummated the verbal contract of sale of the Subject Land. The Statute of Frauds was enacted to prevent
fraud. This law cannot be used to advance the very evil the law seeks to prevent.
RE PRESCRIPTION & LACHES:
Article 1456 of the Civil Code provides that a person acquiring property through fraud becomes by operation of
law a trustee of an implied trust for the benefit of the real owner of the property. The presence of fraud in this
case created an implied trust in favor of Armando and Adelia. This gives Armando and Adelia the right to seek
reconveyance of the property from the Subsequent Buyers.[40]
To determine when the prescriptive period commenced in an action for reconveyance, plaintiffs possession of
the disputed property is material. An action for reconveyance based on an implied trust prescribes in ten years.
[41] The ten-year prescriptive period applies only if there is an actual need to reconvey the property as when the
plaintiff is not in possession of the property.[42] However, if the plaintiff, as the real owner of the property also
remains in possession of the property, the prescriptive period to recover title and possession of the property does
not run against him.[43] In such a case, an action for reconveyance, if nonetheless filed, would be in the nature
of a suit for quieting of title, an action that is imprescriptible.
RE VALIDITY OF SUBSEQUENT SALE:
Godofredo and Carmen had already sold the Subject Land to Armando and Adelia. The settled rule is when
ownership or title passes to the buyer, the seller ceases to have any title to transfer to any third person.[54] If the
seller sells the same land to another, the second buyer who has actual or constructive knowledge of the prior sale
cannot be a registrant in good faith.[55] Such second buyer cannot defeat the first buyers title.[56] In case a title
is issued to the second buyer, the first buyer may seek reconveyance of the property subject of the sale.[57]
Thus, to merit protection under the second paragraph of Article 1544[58] of the Civil Code, the second buyer
must act in good faith in registering the deed.[59] In this case, the Subsequent Buyers good faith hinges on
whether they had knowledge of the previous sale. Petitioners do not dispute that Armando and Adelia registered
their adverse claim with the Registry of Deeds of Bataan on 8 February 1994. The Subsequent Buyers purchased
their respective lots only on 22 February 1994 as shown by the date of their deeds of sale. Consequently, the
adverse claim registered prior to the second sale charged the Subsequent Buyers with constructive notice of the
defect in the title of the sellers,[60] Godofredo and Carmen.
WHEREFORE, the petition is DENIED and the appealed decision is AFFIRMED. Treble costs against
petitioners.
CASE LAW/ DOCTRINE:
DISSENTING/CONCURRING OPINION(S):

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085 SPOUSES GODOFREDO ALFREDO and

CARMEN LIMON ALFREDO, SPOUSES ARNULFO

Di ko gets kung ano yung rem issue ditto. Puro sales

from the provisions of the Statute of Frauds.

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