403 Morales vs. Court of Appeals

403 Morales vs. Court of Appeals sister, Aurea, taking care of the premises in question.
are of the premises in question. While he was already in Cebu,

G.R. No. 117228 the defendant, without the knowledge and consent of the former, constructed a
June 19, 1997 small beauty shop in the premises in question. Inasmuch as the Plaintiffs are the
BY: ANG purchasers of the other real properties of Celso Avelino, one of which is at Acedillo
TOPIC: TRUSTS (now Sen. J.D. Avelino) street, after they were offered by Celso Avelino to buy the
PETITIONERS: Rodolfo Morales represented by his heirs premises in question, they examined the premises in question and talked with the
RESPONDENTS: Court of Appeals, Randulfo Ortiz, Jr. defendant about that fact, the latter encouraged them to purchase the premises in
PONENTE: Davide, Jr., J. question rather than the property going to somebody else they do not know and
DOCTRINE: A trust is the legal relationship between one person having an equitable that he will vacate the premises as soon as his uncle will notify him to do so. Thus,
ownership in property and another person owning the legal title to such property. they paid the purchase price and Exh. "C" was executed in their favor. However,
This equitable ownership of the former entitling him to the performance of certain despite due notice from his uncle to vacate the premises in question, the defendant
duties and the exercise of certain powers by the latter. The characteristics of a trust refused to vacate or demolish the beauty shop unless he is reimbursed P35,000.00
are: for it although it was valued at less than P5,000.00. So, the Plaintiffs demanded,
1. it is a relationship of fiduciary character; orally and in writing to vacate the premises. The defendant refused.
2. it is a relationship with respect to property;
3. it involves the existence of equitable duties imposed upon the holder of As the plaintiffs were about to undertake urgent repairs on the dilapidated
the title to the property to deal with it for the benefit of another; and residential building, the defendant had already occupied the same, taking in paying
4. it arises as a result of a manifestation of intention to create the boarders and claiming already ownership of the premises in question, thus they
relationship. filed this case. Plaintiffs, being the neighbors of Celso Avelino, of their own
FACTS: knowledge are certain that the premises in question is indeed owned by their
predecessor-in-interest because the male plaintiff used to play in the premises
The evidence adduced by the Plaintiffs discloses that the Plaintiffs are the absolute when he was still in his teens while the female plaintiff resided with the late Judge
and exclusive owners of the premises in question having purchased the same from Avelino. Besides, their inquiries and documentary evidence shown to them by Celso
Celso Avelino. They later caused the transfer of its tax declaration in the name of Avelino confirm this fact. Likewise, the defendant and Intervenor did not reside in
the female plaintiff and paid the realty taxes thereon. Celso Avelino (Plaintiffs' the premises in question because they reside respectively in Brgy. Tarobucan and
predecessor in interest) purchased the land in question consisting of two adjoining Brgy. Trinidad (Sabang), both of Calbayog City with their own residential houses
parcels while he was still a bachelor and the City Fiscal of Calbayog City from there. Due to the damages they sustained as a result of the filing of this case, the
Alejandra Mendiola and Celita Bartolome, through a "Escritura de Venta". After the plaintiffs are claiming P50,000.00 for mental anguish; monthly rental of the
purchase, he caused the transfer of the tax declarations of the two parcels in his premises in question of P1,500.00 starting from March 1987; litigation expenses of
name as well as consolidated into one the two tax declarations in his name. With P5,000.00 and P10,000.00 for Attorney's fees.
the knowledge of the Intervenor and the defendant, Celso Avelino caused the
survey of the premises in question, in his name, by the Bureau of Lands.
ISSUE: Whether or not the property acquired is a trust property?
He also built his residential house therein with Marcial Aragon (now dead) as his
master carpenter who was even scolded by him for constructing the ceiling too RULING:
low. When the two-storey residential house was finished, he took his parents,
Rosendo Avelino and Juana Ricaforte, and his sister, Aurea, who took care of the NO. A trust is the legal relationship between one person having an equitable
couple, to live there until their deaths. He also declared this residential house in his ownership in property and another person owning the legal title to such property,
tax declaration to the premises in question and paid the corresponding realty taxes, the equitable ownership of the former entitling him to the performance of certain
keeping intact the receipts which he comes to get or Aurea would go to Cebu to duties and the exercise of certain powers by the latter. The characteristics of a trust
give it to him. After being the City Fiscal of Calbayog, Celso Avelino became an are: It is a relationship; it is a relationship of fiduciary character; it is a relationship
Immigration Officer and later as Judge of the Court of First Instance in Cebu with his with respect to property, not one involving merely personal duties; it involves the
existence of equitable duties imposed upon the holder of the title to the property
to deal with it for the benefit of another; and it arises as a result of a manifestation
of intention to create the relationship.
Trusts are either express or implied. Express trusts are created by the intention of
the trustor or of the parties, while implied trusts come into being by operation of
law, either through implication of an intention to create a trust as a matter of law
or through the imposition of the trust irrespective of, and even contrary to, any
such intention. In turn, implied trusts are either resulting or constructive trusts.
Resulting trusts are based on the equitable doctrine that valuable consideration
and not legal title determines the equitable title or interest and are presumed
always to have been contemplated by the parties. They arise from the nature or
circumstances of the consideration involved in a transaction whereby one person
thereby becomes invested with legal title but is obligated in equity to hold his legal
title for the benefit of another. On the other hand, constructive trusts are created
by the construction of equity in order to satisfy the demands of justice and prevent
unjust enrichment. They arise contrary to intention against one who, by fraud,
duress or abuse of confidence, obtains or holds the legal right to property which he
ought not, in equity and good conscience, to hold.
DISPOSITIVE: WHEREFORE, premises considered, except as to the award of moral

damages, attorney's fees and litigation expenses which are hereby DELETED, the
judgment of the respondent Court of Appeals is AFFIRMED.
Cost against petitioners.

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403 Morales vs. Court of Appeals sister, Aurea, taking care of the premises in question.

are of the premises in question. While he was already in Cebu,

DISPOSITIVE: WHEREFORE, premises considered, except as to the award of moral

Cost against petitioners.

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