Secretary of Education vs. Heirs of Rufino Dulay (G.R. No. 164748, January 27, 2006, 480 SCRA 452)

FACTS:
On August 3, 1981, the spouses Rufino Dulay, Sr. and Ignacia Vicente Dulay executed a deed of donation over a 10,000-square-meter portion of their property in favor of the Ministry of Education and Culture.

The property was subdivided. On April 13, 1983, a Transfer Certificate of Title was issued in the name of the Ministry of Education and Culture, represented by Laurencio C. Ramel, the Superintendent of Schools of Isabela. However, the property was not used for school purposes and remained idle.

Sometime in 1988, the DECS, through its Secretary, started construction of the Rizal National High School building on a parcel of land it acquired from Alejandro Feliciano. The school site was about 2 kilometers away from the land donated by the spouses Dulay.

In a letter to the DECS Secretary dated August 19, 1994, the spouses Dulay requested that the property be returned to them considering that the land was never used since 1981, or a period of more than 13 years. On August 28, 1994, the Barangay Council of Rizal, Santiago City issued Resolution No. 397 recognizing the right of the donors to redeem the subject parcel of land because of the DECS’ failure to utilize it for the intended purpose. It further resolved that the Rizal National High School no longer needed the donated land "considering its distance from the main campus and [the] failure to utilize the property for a long period of time."

On August 31, 1997, the heirs of Dulay, Sr., herein respondents, filed a complaint for the revocation of the deed of donation and cancellation of the title, alleging that (1) there was a condition in the deed of donation: that the DECS, as donee, utilize the subject property for school purposes, that is, the construction of a building to house the Rizal National High School, (2) the DECS did not fulfill the condition and that the land remained idle up to the present, and (3) the donation inter vivos was inofficious, since the late Rufino Dulay, Sr. donated more than what he could give by will.

Petitioners, through the Office of the Solicitor General (OSG), interposed the following defenses: (a) the DECS complied with said condition because the land was being used by the school as its technology and home economics laboratory; (b) the donation was not inofficious for the donors were the owners of five other parcels of land, all located at Rizal, Santiago City; (c) the DECS acquired the disputed property by virtue of purchase made on December 8, 1997 by the barangay of Rizal, Santiago City in the amount of P18,000.00 as certified by its former Barangay Captain, Jesus San Juan;11 and (d) the action of the respondents had prescribed. The OSG also claimed that students planted a portion of the land with rice, mahogany seedlings, and fruit-bearing trees; the produce would then be sold and the proceeds used for the construction of a school building on the subject property.

ISSUE:
(1) Whether or nor the DECS had complied with the condition imposed on the the deed of donation.
(2) Whether the respondents' right to seek the revocation of the deed of donation is already barred by prescription and laches.

HELD:
The contention of petitioners has no merit.

As gleaned from the CA decision, petitioners failed to prove that the donated property was used for school purposes as indicated in the deed of donation:

We find it difficult to sustain that the defendant-appellants have complied with the condition of donation. It is not amiss to state that other than the bare allegation of the defendant-appellants, there is nothing in the records that could concretely prove that the condition of donation has been complied with by the defendant-appellants. In the same breadth, the planting of palay on the land donated can hardly be considered and could not have been the "school purposes" referred to and intended by the donors when they had donated the land in question. Also, the posture of the defendant-appellants that the land donated is being used as technology and home economics laboratory of the Rizal National High School is far from being the truth considering that not only is the said school located two kilometers away from the land donated but also there was not even a single classroom built on the land donated that would reasonably indicate that, indeed, classes have been conducted therein. These observations, together with the unrebutted ocular inspection report made by the trial court which revealed that the land donated remains idle and without any improvement thereon for more than a decade since the time of the donation, give Us no other alternative but to conclude that the defendant-appellants have, indeed, failed to comply with what is incumbent upon them in the deed of donation.

The right to seek the revocation of donation had not yet prescribed when respondents filed their complaint

Anent the second issue, we reject the contention of the OSG that respondents’ cause of action is already barred by prescription under Article 764 of the New Civil Code, or four years from the non-compliance with the condition in the deed of donation. Since such failure to comply with the condition of utilizing the property for school purposes became manifest sometime in 1988 when the DECS utilized another property for the construction of the school building, the four-year prescriptive period did not commence on such date. Petitioner was given more than enough time to comply with the condition, and it cannot be allowed to use this fact to its advantage. It must be stressed that the donation is onerous because the DECS, as donee, was burdened with the obligation to utilize the land donated for school purposes. Under Article 733 of the New Civil Code, a donation with an onerous cause is essentially a contract and is thus governed by the rules on contract.

Shoppers Paradise Realty & Development Corporation vs. Felipe Roque (G.R. No. 148775, January 13, 2004, 419 SCRA 93)

FACTS:
On 23 December 1993, petitioner Shopper’s Paradise Realty & Development Corporation, represented by its president, Veredigno Atienza, entered into a twenty-five year lease with Dr. Felipe C. Roque, now deceased, over a parcel of land. Simultaneously, petitioner and Dr. Roque likewise entered into a memorandum of agreement for the construction, development and operation of a commercial building complex on the property. Conformably with the agreement, petitioner issued a check for another P250,000.00 "downpayment" to Dr. Roque.

The contract of lease and the memorandum of agreement, both notarized, were to be annotated on TCT No. 30591 within sixty (60) days from 23 December 1993 or until 23 February 1994. The annotations, however, were never made because of the untimely demise of Dr. Felipe C. Roque. The death of Dr. Roque on 10 February 1994 constrained petitioner to deal with respondent Efren P. Roque, one of the surviving children of the late Dr. Roque, but the negotiations broke down due to some disagreements. Respondent then filed a case for annulment of the contract of lease and the memorandum of agreement, with a prayer for the issuance of a preliminary injunction.

Efren P. Roque alleged that he had long been the absolute owner of the subject property by virtue of a deed of donation inter vivos executed in his favor by his parents, Dr. Felipe Roque and Elisa Roque, on 26 December 1978, and that the late Dr. Felipe Roque had no authority to enter into the assailed agreements with petitioner. The donation was made in a public instrument duly acknowledged by the donor-spouses before a notary public and duly accepted on the same day by respondent before the notary public in the same instrument of donation. The title to the property, however, remained in the name of Dr. Felipe C. Roque, and it was only transferred to and in the name of respondent sixteen years later, or on 11 May 1994.

The trial court dismissed the complaint of the respondent, explaining that "(o)rdinarily, a deed of donation need not be registered in order to be valid between the parties. Registration, however, is important in binding third persons. Thus, when Felipe Roque entered into a leased contract with defendant corporation, plaintiff Efren Roque (could) no longer assert the unregistered deed of donation and say that his father, Felipe, was no longer the owner of the subject property at the time the lease on the subject property was agreed upon."

On appeal, the Court of Appeals reversed the decision of the trial court, explaining that petitioner was not a lessee in good faith having had prior knowledge of the donation in favor of respondent, and that such actual knowledge had the effect of registration insofar as petitioner was concerned.

HELD:
The existence, albeit unregistered, of the donation in favor of respondent is undisputed. The trial court and the appellate court have not erred in holding that the non-registration of a deed of donation does not affect its validity. As being itself a mode of acquiring ownership, donation results in an effective transfer of title over the property from the donor to the donee. In donations of immovable property, the law requires for its validity that it should be contained in a public document, specifying therein the property donated and the value of the charges which the donee must satisfy. The Civil Code provides, however, that "titles of ownership, or other rights over immovable property, which are not duly inscribed or annotated in the Registry of Property (now Registry of Land Titles and Deeds) shall not prejudice third persons." It is enough, between the parties to a donation of an immovable property, that the donation be made in a public document but, in order to bind third persons, the donation must be registered in the registry of Property (Registry of Land Titles and Deeds). Consistently, Section 50 of Act No. 496 (Land Registration Act), as so amended by Section 51 of P.D. No. 1529 (Property Registration Decree), states:

"SECTION 51. Conveyance and other dealings by registered owner.- An owner of registered land may convey, mortgage, lease, charge or otherwise deal with the same in accordance with existing laws. He may use such forms of deeds, mortgages, leases or other voluntary instruments as are sufficient in law. But no deed, mortgage, lease, or other voluntary instrument, except a will purporting to convey or affect registered land shall take effect as a conveyance or bind the land, but shall operate only as a contract between the parties and as evidence of authority to the Register of Deeds to make registration.


"The act of registration shall be the operative act to convey or affect the land insofar as third persons are concerned, and in all cases under this Decree, the registration shall be made in the office of the Register of Deeds for the province or city where the land lies."

Petition denied.

Soledad Calicdan vs. Silverio Centena (G.R. No. 155080, February 5, 2004, 422 SCRA 274)

FACTS:
On August 25, 1947, Fermina Calicdan executed a deed of donation inter vivos whereby she conveyed the land to respondent Silverio Cendaña, who immediately entered into possession of the land, built a fence around the land and constructed a two-storey residential house thereon sometime in 1949, where he resided until his death in 1998.

On June 29, 1992, petitioner, through her legal guardian Guadalupe Castillo, filed a complaint for "Recovery of Ownership, Possession and Damages" against the respondent, alleging that the donation was void; that respondent took advantage of her incompetence in acquiring the land; and that she merely tolerated respondent’s possession of the land as well as the construction of his house thereon.

In his "Answer with Motion to Dismiss", respondent alleged, by way of affirmative defenses, that the land was donated to him by Fermina in 1947; and that he had been publicly, peacefully, continuously, and adversely in possession of the land for a period of 45 years. Moreover, he argued that the complaint was barred by prior judgment in the special proceedings for the "Inventory of Properties of Incompetent Soledad Calicdan", where the court decreed the exclusion of the land from the inventory of properties of the petitioner.

The trial court ruled in favor of the petitioner, while the Court of Appeals reversed the trial court's decision.

ISSUE:
Whether or not the donation inter vivos is valid

HELD:
The trial court found the donation of the land void because Fermina was not the owner thereof, considering that it was inherited by Sixto from his parents. Thus, the land was not part of the conjugal property of the spouses Sixto and Fermina Calicdan, because under the Spanish Civil Code, the law applicable when Sixto died in 1941, the surviving spouse had a right of usufruct only over the estate of the deceased spouse. Consequently, respondent, who derived his rights from Fermina, only acquired the right of usufruct as it was the only right which the latter could convey.

After a review of the evidence on record, we find that the Court of Appeals’ ruling that the donation was valid was not supported by convincing proof. Respondent himself admitted during the cross examination that he had no personal knowledge of whether Sixto Calicdan in fact purchased the subject land from Felomino Bautista.

In People v. Guittap, we held that:

Under Rule 130, Section 36 of the Rules of Court, a witness can testify only to those facts which he knows of his own personal knowledge, i.e., which are derived from his own perception; otherwise, such testimony would be hearsay. Hearsay evidence is defined as "evidence not of what the witness knows himself but of what he has heard from others." The hearsay rule bars the testimony of a witness who merely recites what someone else has told him, whether orally or in writing. In Sanvicente v. People, we held that when evidence is based on what was supposedly told the witness, the same is without any evidentiary weight for being patently hearsay. Familiar and fundamental is the rule that hearsay testimony is inadmissible as evidence.

The Court of Appeals thus erred in ruling based on respondent’s bare hearsay testimony as evidence of the donation made by Fermina.

Seventh Day Adventist Conference Church of Southern Philippines vs. North Eastern Mindanao Mission of Seventh Day Adventist, Inc. (496 SCRA 215)

FACTS:
Spouses Felix Cosio and Felisa Cuysona donate a parcel of land to South Philippine [Union] Mission of Seventh Day Adventist Church, and was received by Liberato Rayos, an elder of the Seventh Day Adventist Church, on behalf of the donee.

However, twenty years later, the spouses sold the same land to the Seventh Day Adventist Church of Northeastern Mindanao Mission.

Claiming to be the alleged donee’s successors-in-interest, petitioners asserted ownership over the property. This was opposed by respondents who argued that at the time of the donation, SPUM-SDA Bayugan could not legally be a donee because, not having been incorporated yet, it had no juridical personality. Neither were petitioners members of the local church then, hence, the donation could not have been made particularly to them.

ISSUE:
Should the Seventh Day Adventist Church of Northeastern Mindanao Mission's ownership of the lot be upheld?

HELD:
We answer in the affirmative.

Donation is undeniably one of the modes of acquiring ownership of real property. Likewise, ownership of a property may be transferred by tradition as a consequence of a sale.

Donation is an act of liberality whereby a person disposes gratuitously of a thing or right in favor of another person who accepts it. The donation could not have been made in favor of an entity yet inexistent at the time it was made. Nor could it have been accepted as there was yet no one to accept it.

The deed of donation was not in favor of any informal group of SDA members but a supposed SPUM-SDA Bayugan (the local church) which, at the time, had neither juridical personality nor capacity to accept such gift.

(With questions regarding de facto corporation and law of sales.)

Petition Denied.

Victoria Moreño-Lentfer vs. Hans Jurgen Wolff (G.R. No. 152317, November 10, 2004, 441 SCRA 584)

FACTS:
On March 6, 1992, petitioners and respondent engaged the notarial services of Atty. Rodrigo C. Dimayacyac for: (1) the sale of a beach house owned by petitioner Cross in Sabang, Puerto Galera, Oriental Mindoro, and (2) the assignment of Cross' contract of lease on the land where the house stood. The sale of the beach house and the assignment of the lease right would be in the name of petitioner Victoria Moreño-Lentfer, but the total consideration of 220,000 Deutschmarks (DM) would be paid by respondent Hans Jurgen Wolff. A promissory note was executed by said respondent in favor of petitioner Cross.

According to respondent, however, the Lentfer spouses were his confidants who held in trust for him, a time deposit account in the amount of DM 200,0004 at Solid Bank Corporation. Apprised of his interest to own a house along a beach, the Lentfer couple urged him to buy petitioner Cross' beach house and lease rights in Puerto Galera. Respondent agreed and through a bank-to-bank transaction, he paid Cross the amount of DM 221,7005 as total consideration for the sale and assignment of the lease rights. However, Cross, Moreño-Lentfer and Atty. Dimayacyac surreptitiously executed a deed of sale whereby the beach house was made to appear as sold to Moreño-Lentfer for only P100,000. The assignment of the lease right was likewise made in favor of Moreño-Lentfer. Upon learning of this, respondent filed a Complaint docketed as Civil Case No. R-4219 with the lower court for annulment of sale and reconveyance of property with damages and prayer for a writ of attachment.

The lower court dismissed the respondent's complaint, but the Court of Appeals reversed the lower court's decision.

HELD:
Petitioner Moreño-Lentfer's claim of either cash or property donation rings hollow. A donation is a simple act of liberality where a person gives freely of a thing or right in favor of another, who accepts it. But when a large amount of money is involved, equivalent to P3,297,800, based on the exchange rate in the year 1992, we are constrained to take the petitioners' claim of liberality of the donor with more than a grain of salt.

Petitioners could not brush aside the fact that a donation must comply with the mandatory formal requirements set forth by law for its validity. Since the subject of donation is the purchase money, Art. 748 of the New Civil Code is applicable. Accordingly, the donation of money equivalent to P3,297,800 as well as its acceptance should have been in writing. It was not. Hence, the donation is invalid for non-compliance with the formal requisites prescribed by law.

Petition denied.

Enrique Ma. Barretto vs. City of Manila (G.R. No. 3148, February 6, 1907, 7 Phil 416)

FACTS:
Enrique Ma. Barretto donates his lot in front of Malacanang Palace to the City of Manila, on the condition that "no structures shall be erected upon the land and that it will not be devoted to any purpose other than the beautifying of the vicinity, and for this purpose the city should acquire such of the adjoining land as may be necessary to form with mine a public square with gardens and walks." The Ayuntamiento and the Corregimiento of the City declared its acceptance over Barretto's offer, both requesting for its documents and necessary deeds of conveyance. Barretto thereafter sent to the Ayuntamiento the necessary documents, and until the month of February, 1903, appears to have had the idea that a formal transfer of the plot had been executed by him; in fact, it had not been.

However, the city entered into possession of the land, building a railing separating it from the adjoining property, and ever since that time the ground has been used as part of the public street, increasing the width thereof opposite the exit from the Palace and substantially improving the appearance of the locality. Barretto brought the action to recover possession of the land on account of the failure of the city to comply with the conditions of the donation.

HELD:
Although a formal conveyance of the property appears to have never been made, yet the taking possession of the land by the city upon the terms contained in the offer and acceptance give effect to the latter.

The whole negotiation must be taken into consideration in order to determine what was in the minds of the parties at the time. The plaintiff's proposition was unmistakable. If the city designed to reject any part of it while accepting the rest, such rejection should have been in express terms. Not only do we fail to find any such rejection, but in the letter of June 19 there appears to be in its concluding words an express recognition of the terms imposed, when it is provided that the deed of cession shall be drawn "with the restrictions indicated by you." This is a reference to the restrictions in the letter of the plaintiff and operates of necessity as an acceptance of them.

Eugenio Cagaoan vs. Felix Cagaoan (G.R. No. L-17900, June 21, 1922, 43 Phil 554)

FACTS:
On November 3, 1915, Gregorio Cagaoan executed a deed of gift of four parcels of land situated in the municipality of Tayug, Province of Pangasinan, in favor of his son Felix Cagaoan and on October 26, 1918, he executed a similar deed in favor of his other son Eugenio Cagaoan for a parcel of land which, apparently, is the same as that described as parcel No. 4 in the deed of gift executed in favor of Felix. Both of the deeds of gift are free from formal defects and were duly accepted by the donees.

Eugenio was able to take possession of the donation he received, but he was not able to register the same. On the other hand, Felix was able to register his part.

HELD:
The case seems to use to be analogous to one where the same real property has been sold by the same vendor to two difference vendees. In such cases, under article 1473 of the Civil Code, the property goes to the vendee who first records his title in the registry of property. If the sale is not recorded by either vendee, the property goes to the one who first takes possession of its in good, faith, and in the absence of both record and possession, to the one who present oldest title, provided there is good faith. (It follows the rule of double sales.)