Republic of the Philippines 9. Emiliana Santiago ................................................................................................
13
SUPREME COURT
Manila
EN BANC
G.R. No. L-45425 April 29, 1939
JOSE GATCHALIAN, ET AL., plaintiffs-appellants,
vs.
THE COLLECTOR OF INTERNAL REVENUE, defendant-appellee.
IMPERIAL, J.:
The plaintiff brought this action to recover from the defendant Collector of Internal Revenue the
sum of P1,863.44, with legal interest thereon, which they paid under protest by way of income tax.
They appealed from the decision rendered in the case on October 23, 1936 by the Court of First
Instance of the City of Manila, which dismissed the action with the costs against them.
The case was submitted for decision upon the following stipulation of facts:
Come now the parties to the above-mentioned case, through their respective undersigned
attorneys, and hereby agree to respectfully submit to this Honorable Court the case upon
the following statement of facts:
1. That plaintiff are all residents of the municipality of Pulilan, Bulacan, and that defendant
is the Collector of Internal Revenue of the Philippines;
2. That prior to December 15, 1934 plaintiffs, in order to enable them to purchase one
sweepstakes ticket valued at two pesos (P2), subscribed and paid therefor the amounts
as follows:
1. Jose Gatchalian ....................................................................................................
2. Gregoria Cristobal ...............................................................................................
3. Saturnina Silva ....................................................................................................
4. Guillermo Tapia ...................................................................................................
5. Jesus Legaspi ......................................................................................................
6. Jose Silva .............................................................................................................
7. Tomasa Mercado ................................................................................................
8. Julio Gatchalian ...................................................................................................
.
10. Maria C. Legaspi ............................................................................................... .16
11. Francisco Cabral ............................................................................................... .13
12. Gonzalo Javier .................................................................................................... .14
13. Maria Santiago ................................................................................................... .17
14. Buenaventura Guzman ...................................................................................... .13
15. Mariano Santos ................................................................................................. .14
Total ........................................................................................................ 2.00
3. That immediately thereafter but prior to December 15, 1934, plaintiffs purchased, in the
ordinary course of business, from one of the duly authorized agents of the National
Charity Sweepstakes Office one ticket bearing No. 178637 for the sum of two pesos (P2)
and that the said ticket was registered in the name of Jose Gatchalian and Company;
4. That as a result of the drawing of the sweepstakes on December 15, 1934, the above-
mentioned ticket bearing No. 178637 won one of the third prizes in the amount of P50,000
and that the corresponding check covering the above-mentioned prize of P50,000 was
drawn by the National Charity Sweepstakes Office in favor of Jose Gatchalian &
Company against the Philippine National Bank, which check was cashed during the latter
part of December, 1934 by Jose Gatchalian & Company;
5. That on December 29, 1934, Jose Gatchalian was required by income tax examiner
Alfredo David to file the corresponding income tax return covering the prize won by Jose
Gatchalian & Company and that on December 29, 1934, the said return was signed by
Jose Gatchalian, a copy of which return is enclosed as Exhibit A and made a part hereof;
P0.18
6. That on January 8, 1935, the defendant made an assessment against Jose Gatchalian
.18 & Company requesting the payment of the sum of P1,499.94 to the deputy provincial
treasurer of Pulilan, Bulacan, giving to said Jose Gatchalian & Company until January 20,
.08 1935 within which to pay the said amount of P1,499.94, a copy of which letter marked
Exhibit B is enclosed and made a part hereof;
.13
.15 7. That on January 20, 1935, the plaintiffs, through their attorney, sent to defendant a
reply, a copy of which marked Exhibit C is attached and made a part hereof, requesting
.07 exemption from payment of the income tax to which reply there were enclosed fifteen (15)
separate individual income tax returns filed separately by each one of the plaintiffs, copies
.08 of which returns are attached and marked Exhibit D-1 to D-15, respectively, in order of
their names listed in the caption of this case and made parts hereof; a statement of sale
.13 signed by Jose Gatchalian showing the amount put up by each of the plaintiffs to cover up
the attached and marked as Exhibit E and made a part hereof; and a copy of the affidavit
signed by Jose Gatchalian dated December 29, 1934 is attached and marked Exhibit F
and made part thereof;
8. That the defendant in his letter dated January 28, 1935, a copy of which marked Exhibit
G is enclosed, denied plaintiffs' request of January 20, 1935, for exemption from the
payment of tax and reiterated his demand for the payment of the sum of P1,499.94 as
income tax and gave plaintiffs until February 10, 1935 within which to pay the said tax;
9. That in view of the failure of the plaintiffs to pay the amount of tax demanded by the
defendant, notwithstanding subsequent demand made by defendant upon the plaintiffs
through their attorney on March 23, 1935, a copy of which marked Exhibit H is enclosed,
defendant on May 13, 1935 issued a warrant of distraint and levy against the property of
the plaintiffs, a copy of which warrant marked Exhibit I is enclosed and made a part hereof;
10. That to avoid embarrassment arising from the embargo of the property of the plaintiffs,
the said plaintiffs on June 15, 1935, through Gregoria Cristobal, Maria C. Legaspi and
Jesus Legaspi, paid under protest the sum of P601.51 as part of the tax and penalties to
the municipal treasurer of Pulilan, Bulacan, as evidenced by official receipt No. 7454879
which is attached and marked Exhibit J and made a part hereof, and requested defendant
that plaintiffs be allowed to pay under protest the balance of the tax and penalties by
monthly installments;
11. That plaintiff's request to pay the balance of the tax and penalties was granted by
defendant subject to the condition that plaintiffs file the usual bond secured by two solvent
persons to guarantee prompt payment of each installments as it becomes due;
which is attached and marked Exhibit N and made a part hereof; and that on September 3,
1936, the plaintiffs formally protested to the defendant against the payment of said
amount and requested the refund thereof, copy of which is attached and marked Exhibit O
and made part hereof; but that on September 4, 1936, the defendant overruled the protest
and denied the refund thereof; copy of which is attached and marked Exhibit P and made
a part hereof; and
16. That plaintiffs demanded upon defendant the refund of the total sum of one thousand
eight hundred and sixty three pesos and forty-four centavos (P1,863.44) paid under
protest by them but that defendant refused and still refuses to refund the said amount
notwithstanding the plaintiffs' demands.
17. The parties hereto reserve the right to present other and additional evidence if
necessary.
Exhibit E referred to in the stipulation is of the following tenor:
To whom it may concern:
I, Jose Gatchalian, a resident of Pulilan, Bulacan, married, of age, hereby certify, that on
the 11th day of August, 1934, I sold parts of my shares on ticket No. 178637 to the
persons and for the amount indicated below and the part of may share remaining is also
shown to wit:
Purchaser Amount Address

1. Mariano Santos ........................................... P0.14 Pulilan, Bulacan.

12. That on July 16, 1935, plaintiff filed a bond, a copy of which marked Exhibit K is
enclosed and made a part hereof, to guarantee the payment of the balance of the alleged 2. Buenaventura Guzman ............................... .13 - Do -
tax liability by monthly installments at the rate of P118.70 a month, the first payment
under protest to be effected on or before July 31, 1935; 3. Maria Santiago ............................................ .17 - Do -

4. Gonzalo Javier .............................................. .14 - Do -

13. That on July 16, 1935 the said plaintiffs formally protested against the payment of the
sum of P602.51, a copy of which protest is attached and marked Exhibit L, but that 5. Francisco Cabral .......................................... .13 - Do -
defendant in his letter dated August 1, 1935 overruled the protest and denied the request
for refund of the plaintiffs; 6. Maria C. Legaspi .......................................... .16 - Do -

14. That, in view of the failure of the plaintiffs to pay the monthly installments in 7. Emiliana Santiago ......................................... .13 - Do -
accordance with the terms and conditions of bond filed by them, the defendant in his letter
8. Julio Gatchalian ............................................ .13 - Do -
dated July 23, 1935, copy of which is attached and marked Exhibit M, ordered the
municipal treasurer of Pulilan, Bulacan to execute within five days the warrant of distraint 9. Jose Silva ...................................................... .07 - Do -
and levy issued against the plaintiffs on May 13, 1935;
10. Tomasa Mercado ....................................... .08 - Do -
15. That in order to avoid annoyance and embarrassment arising from the levy of their
property, the plaintiffs on August 28, 1936, through Jose Gatchalian, Guillermo Tapia, 11. Jesus Legaspi ............................................. .15 - Do -
Maria Santiago and Emiliano Santiago, paid under protest to the municipal treasurer of
12. Guillermo Tapia ........................................... .13 - Do -
Pulilan, Bulacan the sum of P1,260.93 representing the unpaid balance of the income tax
and penalties demanded by defendant as evidenced by income tax receipt No. 35811
13. Saturnina Silva ............................................ .08 - Do - 9. Emiliana
D-9 .13 3,325 360 2,965
Santiago ......................................
14. Gregoria Cristobal ....................................... .18 - Do -
10. Maria C.
15. Jose Gatchalian ............................................ .18 - Do - D-10 .16 4,100 960 3,140
Legaspi ......................................

11. Francisco
2.00 Total cost of said D-11 .13 3,325 360 2,965
Cabral ......................................

12. Gonzalo
ticket; and that, therefore, the persons named above are entitled to the parts of whatever D-12 .14 3,325 360 2,965
Javier ..........................................
prize that might be won by said ticket.
13. Maria
D-13 .17 4,350 360 3,990
Pulilan, Bulacan, P.I. Santiago ..........................................

14. Buenaventura
(Sgd.) JOSE GATCHALIAN D-14 .13 3,325 360 2,965
Guzman ...........................

And a summary of Exhibits D-1 to D-15 is inserted in the bill of exceptions as follows: 15. Mariano
D-15 .14 3,325 360 2,965
Santos ........................................
RECAPITULATIONS OF 15 INDIVIDUAL INCOME TAX RETURNS FOR 1934 ALL
DATED JANUARY 19, 1935 SUBMITTED TO THE COLLECTOR OF INTERNAL 2.00 50,000
REVENUE.
Exhibit Purchase Price Net
Name Expenses The legal questions raised in plaintiffs-appellants' five assigned errors may properly be reduced to
No. Price Won prize
the two following: (1) Whether the plaintiffs formed a partnership, or merely a community of
1. Jose property without a personality of its own; in the first case it is admitted that the partnership thus
D-1 P0.18 P4,425 P 480 3,945 formed is liable for the payment of income tax, whereas if there was merely a community of
Gatchalian ..........................................
property, they are exempt from such payment; and (2) whether they should pay the tax collectively
2. Gregoria or whether the latter should be prorated among them and paid individually.
D-2 .18 4,575 2,000 2,575
Cristobal ......................................
The Collector of Internal Revenue collected the tax under section 10 of Act No. 2833, as last
3. Saturnina
D-3 .08 1,875 360 1,515 amended by section 2 of Act No. 3761, reading as follows:
Silva .............................................

4. Guillermo SEC. 10. (a) There shall be levied, assessed, collected, and paid annually upon the total
D-4 .13 3,325 360 2,965
Tapia .......................................... net income received in the preceding calendar year from all sources by every corporation,
joint-stock company, partnership, joint account (cuenta en participacion), association or
5. Jesus Legaspi by Maria insurance company, organized in the Philippine Islands, no matter how created or
D-5 .15 3,825 720 3,105
Cristobal ......... organized, but not including duly registered general copartnership (compañias colectivas),
a tax of three per centum upon such income; and a like tax shall be levied, assessed,
6. Jose collected, and paid annually upon the total net income received in the preceding calendar
D-6 .08 1,875 360 1,515
Silva .................................................... year from all sources within the Philippine Islands by every corporation, joint-stock
company, partnership, joint account (cuenta en participacion), association, or insurance
7. Tomasa
D-7 .07 1,875 360 1,515 company organized, authorized, or existing under the laws of any foreign country,
Mercado .......................................
including interest on bonds, notes, or other interest-bearing obligations of residents,
8. Julio Gatchalian by Beatriz corporate or otherwise: Provided, however, That nothing in this section shall be construed
D-8 .13 3,150 240 2,910 as permitting the taxation of the income derived from dividends or net profits on which the
Guzman .......
normal tax has been paid.
 The gain derived or loss sustained from the sale or other disposition by a corporation,
joint-stock company, partnership, joint account (cuenta en participacion), association, or
insurance company, or property, real, personal, or mixed, shall be ascertained in
accordance with subsections (c) and (d) of section two of Act Numbered Two thousand
eight hundred and thirty-three, as amended by Act Numbered Twenty-nine hundred and
twenty-six.

The foregoing tax rate shall apply to the net income received by every taxable corporation,
joint-stock company, partnership, joint account (cuenta en participacion), association, or
insurance company in the calendar year nineteen hundred and twenty and in each year
thereafter.

There is no doubt that if the plaintiffs merely formed a community of property the latter is exempt
from the payment of income tax under the law. But according to the stipulation facts the plaintiffs
organized a partnership of a civil nature because each of them put up money to buy a
sweepstakes ticket for the sole purpose of dividing equally the prize which they may win, as they
did in fact in the amount of P50,000 (article 1665, Civil Code). The partnership was not only
formed, but upon the organization thereof and the winning of the prize, Jose Gatchalian personally
appeared in the office of the Philippines Charity Sweepstakes, in his capacity as co-partner, as
such collection the prize, the office issued the check for P50,000 in favor of Jose Gatchalian and
company, and the said partner, in the same capacity, collected the said check. All these
circumstances repel the idea that the plaintiffs organized and formed a community of property only.

Having organized and constituted a partnership of a civil nature, the said entity is the one bound to
pay the income tax which the defendant collected under the aforesaid section 10 (a) of Act No.
2833, as amended by section 2 of Act No. 3761. There is no merit in plaintiff's contention that the
tax should be prorated among them and paid individually, resulting in their exemption from the tax.

In view of the foregoing, the appealed decision is affirmed, with the costs of this instance to the
plaintiffs appellants. So ordered.

Avanceña, C.J., Villa-Real, Diaz, Laurel, Concepcion and Moran, JJ., concur.
 Republic of the Philippines the plaintiff, on the grounds as he alleged in his answer that he had built on the lot in
SUPREME COURT question a conjugal house worth P8,000.00 which necessarily makes the lot on which it
Manila stands subject to Article 158 of the Civil Code and on the point of view of equity that the
wife of the defendant Felipe Rosado received an aliquot share of P2,400.00 only from the
share and if the house were demolished the defendant would suffer damage in the
EN BANC
amount of P8,000.00;

G.R. No. L-27933 December 24, 1968

6. That the portion of the lot on which the house stands, would earn a monthly rental of
P50.00;
DIVERSIFIED CREDIT CORPORATION, plaintiff-appellee,
vs.
7. That Felipe Rosado, husband of Luz Jayme, did not give his conformity to the Deed of
FELIPE ROSADO and LUZ JAYME ROSADO, defendants-appellants.
Sale, Exh. "A".

REYES, J.B.L.:
8. That on October 31, 1964, the defendant Felipe Rosado requested the plaintiff in the
letter, Exh. "C" for the plaintiff, for a period of six (6) months within which to vacate the
This appeal from a decision of the Court of First Instance of Bacolod City, Negros Occidental (Civ. premises.
Case No. 7516 of that Court) was certified to us by the Court of Appeals (Second Division)
because the same involves no questions of fact.
9. That the letter was not answered by the plaintiff and they did not accept the offer, and
on November 25, 1964, they filed a complaint before the Municipal Court which proves
The case had its origin in the Municipal Court of Bacolod City, when the Diversified Credit that plaintiff neglected the offer;
Corporation filed an action to compel the spouses Felipe Rosado and Luz Jayme Rosado to
vacate and restore possession of a parcel of land in the City of Bacolod (Lot 62-B of Subdivision
The Court of First Instance in its decision rejected the claim of ownership advanced by Rosado,
plan LRC-Psd-33823) that forms part of Lot No. 62 of the Bacolod Cadastre, and is covered by
based upon the construction of a house on the disputed lot by the conjugal partnership of the
Transfer Certificate of Title No. 27083 in the name of plaintiff. After answer, claiming that the lot
Rosado spouses, which allegedly converted the land into conjugal property under Article 158,
was defendants' conjugal property, the Municipal Court ordered defendants to surrender and
paragraph 2 of the present Civil Code of the Philippines; further held that defendants were in
vacate the land in litigation; to pay P100.00 a month from the filing of the complaint up to the
estoppel to claim title in view of the letter Exhibit C requesting for six (6) months within which to
actual vacating of the premises; to pay P500.00 attorneys' fees and costs. Upon appeal to the
vacate the premises, and affirmed the decision of the Inferior Court. Defendant Felipe Rosado
Court of First Instance, the case was submitted on the following stipulation of facts (Rec. on App.,
resorted to the Court of Appeals, and his appeal (CA-G.R. No. 37398-R) is the one now before us.
pp. 59-60):
He assigns four alleged errors:

1. That Lot No. 62-B of Bacolod Cadastre belong to the thirteen co-owners, including the
wife of the defendant herein, who owns 1/13th part pro-indiviso;
2. That on May 11, 1964, Luz Jayme Rosado, wife of the defendant Felipe Rosado,
signed a Deed of Sale together with the co-owners of the property to the plaintiff as
shown by Exh. "A" for the plaintiff;
3. That on the lot in question the defendant Felipe Rosado had built a house sometime in
1957 without the whole property having been previously partitioned among the thirteen
(13) co-owners;
(a) The lower court erred in not holding that Exhibit "A" is null and void, since upon the
construction of the conjugal dwelling thereon, the conjugal partnership of the defendant-
appellant Felipe Rosado and Luz Jayme became the owner of the share of Luz Jayme in
Lot No. 62-B, Bacolod Cadastre;
(b) The trial court erred in ordering the defendant-appellant to vacate Lot No. 62-B and in
not holding that Exhibit "A" is null and void because as the legal usufructuary of the share
of Luz Jayme Rosado in Lot 62-B, Bacolod Cadastre, the conjugal partnership, managed
and administered by the defendant-appellant Felipe Rosado can not be deprived of its
usufructuary rights by any contract between Luz Jayme and the plaintiff-appellee;

4. That the title of the property has already been transferred to the plaintiff upon (c) The trial court erred in not holding that the defendant-appellant should be reimbursed
registration of the Deed of Sale in June, 1964, with the Office of the Register of Deeds; the value of the conjugal house constructed on Lot 62-B; and

5. That demand was made by the plaintiff upon the defendant Felipe Rosado and his wife (d) The lower court erred in ordering the defendant-appellant to pay attorneys' fees in the
Luz Jayme Rosado on October 19, 1964, but until now the defendant Felipe Rosado has amount of five hundred (P500.00) pesos.
refused to vacate the premises or to remove his house thereon as shown by Exh. "B" for
It can be seen that the key question is whether by the construction of a house on the lot owned in
common by the Jaymes, and sold by them to the appellant corporation, the land in question or a
1/13th part of it became conjugal property.
Appellant, husband of vendor Luz Jayme, claims the affirmative invoking the second paragraph of
Article 158 of the Civil Code of the Philippines, prescribing that:
ART. 158. Improvements, whether for utility or adornment, made on the separate property
of the spouses through advancements from the partnership or through the industry of
either the husband or the wife, belong to the conjugal partnership.
there is no proof on record that the house occupied only 1/13 of the total area. The construction
was not done in good faith.
WHEREFORE, the judgment of the Court of First Instance is affirmed. Costs against appellant
Felipe Rosado.
Concepcion, C.J., Dizon, Makalintal, Zaldivar, Sanchez, Castro, Fernando and Capistrano,
JJ., concur.

Buildings constructed, at the expense of the partnership, during the marriage on land
belonging to one of the spouses, also pertain to the partnership, but the value of the land
shall be reimbursed to the spouse who owns the same.

Rosado further contends that as the building of the house at the expense of the conjugal
partnership converted the 1/13 undivided share on his wife in Lot 62-B into property of the
community, the deed of sale of May 11, 1964 in favor of the appellee corporation was void in so
far as said 1/13 share is concerned, because his wife, Luz Jayme, had ceased to own such share
from and after the building of the house; and Rosado, as manager of the conjugal partnership, had
not participated in the sale, nor subsequently ratified the same.

We find appellant's thesis legally untenable. For it is a basic principle in the law of co-ownership,
both under the present Civil Code as in the Code of 1889, that no individual co-owner can claim
title to any definite portion of the land or thing owned in common until the partition thereof. Prior to
that time, all that the co-owner has is an ideal, or abstract, quota or proportionate share in the
entire thing owned in common by all the co-owners. The principle is emphasized by the rulings of
this Court. In Lopez vs. Ilustre, 5 Phil. 567, it was held that while a co-owner has the right to freely
sell and dispose of his undivided interest, he has no right to sell a divided part of the real estate
owned in common. "If he is the owner of an undivided half of a tract of land, he has the right to sell
and convey an undivided half, but he has no right to divide the lot into two parts, and convey the
whole of one part by metes and bounds." The doctrine was reiterated in Mercado vs. Liwanag, L-
14429, June 20, 1962, holding that a co-owner may not convey a physical portion of the land
owned in common. And in Santos vs. Buenconsejo, L-20136, June 23, 1965, it was ruled that a
co-owner may not even adjudicate to himself any determinate portion of land owned in common.

Since the share of the wife, Luz Jayme, was at no time physically determined, it cannot be validly
claimed that the house constructed by her husband was built on land belonging to her, and Article
158 of the Civil Code can not apply. Certainly, on her 1/13 ideal or abstract undivided share, no
house could be erected. Necessarily, the claim of conversion of the wife's share from paraphernal
to conjugal in character as a result of the construction must be rejected for lack of factual or legal
basis.

It is the logical consequence of the foregoing ruling that the lower court did not err in holding that
the appellant was bound to vacate the land without reimbursement, since he knew that the land
occupied by the house did not belong exclusively to his wife, but to the other owners as well, and

Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. L-44426 February 25, 1982
SULPICIO CARVAJAL, petitioner,
vs.
THE HONORABLE COURT OF APPEALS ** and EUTIQUIANO CAMARILLO and LIBERATA
CACABELOS, respondents.
TEEHANKEE, J.:
The Court reverses the appellate court's decision affirming in toto the judgment of the Court of
First Instance of Pangasinan, declaring plaintiffs-respondents the lawful owners of the land in
question and ordering defendant (herein petitioner) to pay P30.00 monthly rentals until possession
of the property is surrendered to respondents, for unless there is partition of the estate of the
deceased, either extra judicially or by court order, a co-heir cannot validly claim title to a specific
portion of the estate and send the same. Title to any specific part of the estate does not
automatically pass to the heirs by the mere death of the decedent and the effect of any disposition
by a co-heir before partition shall be limited to the portion which may be allotted to him upon the
dissolution of the communal estate. What a co-heir can validly dispose of is only his hereditary
rights.
Private respondents, who are husband and wife, had instituted a complaint before the Court of
First Instance for ejectment and recovery of possession against herein petitioner, docketed as Civil
Case No. T-1163, alleging that they are the owners in fee simple of a parcel of commercial land,
pro-indiviso, consisting of 150.8 sq. meters, more or less, situated in Poblacion, Tayug,
Pangasinan, having bought the same from Evaristo G. Espique by virtue of a Deed of Absolute
Sale executed on April 15, 1964. They also demand that petitioner pay a monthly rental for the use
of the property all P40.00 until the property is surrendered to them.
The property in question is a 1/5 portion of a 754 sq. qmeter land originally owned by Hermogenes
Espique and his wife, both dead. After their death their five children, namely: Maria, Evaristo,
Faustina, Estefanio and Tropinia succeeded them in the ownership of the whole lot.
Petitioner presently occupies two-fifths of the whole lot inherited pro-indiviso by the Espique
children. Petitioner alleges that he purchased the northern one-half portion of the lot he is
occupying (which is also claimed by respondents) from Estefanio Espique and that the southern
one-half portion of the lot he is occupying (which is also claimed by respondents) from Estefanio
Espique and that the southern one-half portion is leased to him by Tropinia Espique. The land
subject of the controversy is the most southern portion of the whole lot inherited by the Espique
children which petitioner claims he had bought from Estefanio on April 26, 1967 and which
respondents claim they had bough from Evaristo on April 15, 1964.
Both sales were made while the petition for partition filed by Evaristo Espique was still pending
before the Court of First Instance of Pangasinan, docketed therein as Civil Case No. T-966.
The Court finds merit in the petition for setting aside respondent appellate court's decision finding
for respondents-plaintiffs, for the following considerations:
The action for ejectment and recovery of possession instituted by herein respondents in the lower
court is premature, for what must be settled frist is the action for partition. Unless a project of
partition is effected, each heir cannot claim ownership over a definite portion of the inheritance.
Without partition, either by agreement between the parties of by judicial proceeding, a co-heir
cannot dispose of a specific portion of the estate. For where there are two or more heirs, the whole
estate such heirs. 1 Upon the death of a person, each of his heirs becomes the undivided owner of
the whole estate left wtih respect to the part of portion which might be adjudicated to him, a
community of ownership being thus formed among the co-owners of the estate or co-heirs while it
remains undivided. 2
While under Article 493 of the New Civil Code, each co-owner shall have the full ownership of his
part and of the fruits and benefits pertaining thereto and he may alienate, assign or mortgage it,
and even substitute another person in its enjoyment, the effect of the alienation or the mortgage
with respect to the co-owners, shall be limited, by mandate of the same article, to the portion
which may be allotted to him in the division upon the termination of the co-ownership. He has no
right to sell or alienate a concrete, specific, or determinate part of the thing in common to the
exclusion of the other co-owners because his right over the thing is represented by an abstract or
Ideal portion without any physical adjudication. 3 An individual co- owner cannot adjudicate to
himself or claim title to any definite portion of the land or thing owned in common until its actual
partition by agreement or judicial decree. Prior to that time all that the co-owner has is an Ideal or
abstract quota or proportionate share in the entire thing owned in common by all the co-
owners. 4 What a co owner may dispose of is only his undivided aliquot share, which shall be
limited to the portion that may be allotted to him upon partition. 5 Before partition, a co-heir can
only sell his successional rights. 6
In the case at bar, the fact that the sale executed by Evaristo G. qqqEspique in favor of
respondents and the sale executed by Estefanio Espique in favor of petitioner were made before
the partition of the property among the co-heirs does not annul or invalidate the deeds of sale and
both sales are valid. However, the interests thereby acquired by petitioner and respondents are
limited only to the parts that may be ultimately assigned to Estefanio and Evaristo, respectively,
upon the partition of the estate 7 subject to provisions on subrogation of the other co-heirs to the
rights of the stranger-purchaser provided in Article 1088 of the Civil Code. 8 Respondent court's
ruling that the sale by Estefanio in favor of petitioner is not valid because of lack of notice to his
co-heirs is erroneous. Such notice in writing is not a requisite for the validity of the sale. Its
purpose is merely to apprise the co-heirs of the sale of a portion of the estate, for them to exercise
their preferential right of subrogation under Article 1088 of the New Civil Code, that is, the right to
redeem the property sold within one month from the time they were notified in writing of the sale
by a co-heir. (There is nothing in the record to indicate that such right of subrogation was in effect
sought to be exercised upon the co-heirs' having learned of the sale, which is not in issue here.)

Thus, respondents have no right to eject petitioners nor demand payment of rentals for the use of
the property in dispute. Until the partition of the estate is ordered by the Court of First Instance of
Pangasinan in the pending partition proceedings and the share of each co-heir is determined by
metes and bounds, neither petitioner nor respondents can rightfully claim that what they bought is
the part in dispute.

Accordingly, respondent court's judgment is set aside and judgment is hereby rendered dismissing
the complaint of respondents-plaintiffs in the court below. No pronouncement as to costs.

Makasiar, Guerrero, Melencio-Herrera and Plana, JJ., concur.

Fernandez, J., took no part.


Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-4656 November 18, 1912
RICARDO PARDELL Y CRUZ and
VICENTA ORTIZ Y FELIN DE PARDELL, plaintiffs-appellees,
vs.
GASPAR DE BARTOLOME Y ESCRIBANO and
MATILDE ORTIZ Y FELIN DE BARTOLOME, defendants-appellants.
TORRES, J.:
This is an appeal by bill of exceptions, from the judgment of October 5, 1907, whereby the
Honorable Dionisio Chanco, judge, absolved the defendants from the complaint, and the plaintiff
from a counterclaim, without special finding as to costs.
Counsel for the spouses Ricardo y Cruz and Vicente Ortiz y Felin de Pardell, the first of whom,
absent in Spain by reason of his employment, conferred upon the second sufficient and ample
powers to appear before the courts of justice, on June 8, 1905, in his written complaint, alleged
that the plaintiff, Vicente Ortiz, and the defendant, Matilde Ortiz, are the duly recognized natural
daughters of the spouses Miguel Ortiz and Calixta Felin y Paula who died in Vigan, Ilocos Sur, in
1875 and 1882, respectively; that Calixta Felin, prior to her death, executed on August 17, 1876, a
nuncupative will in Vigan whereby she made her four children, named Manuel, Francisca, Vicenta,
and Matilde, surnamed Ortiz y Felin, her sole and universal heirs of all her property; that, of the
persons enumerated, Manuel died before his mother and Francisca a few years after her death,
leaving no heirs by force of law, and therefore the only existing heirs of the said testatrix are the
plaintiff Vicenta Ortiz and the defendant Matilde Ortiz; that, aside from some personal property and
jewelry already divided among the heirs, the testatrix possessed, at the time of the execution of
her will, and left at her death the real properties which, with their respective cash values, are as
follows:
1. A house of strong material, with the lot on which it is built, situated on Escolta
P6,000.00
Street, Vigan, and valued at
2. A house of mixed material, with the lot on which it stands, at No. 88
1,500.00
Washington Street, Vigan; valued at
3. A lot on Magallanes Street, Vigan; valued at 100.00
4. A parcel of rice land, situated in the barrio of San Julian, Vigan; valued at 60.00
5. A parcel of rice land in the pueblo of Santa Lucia; valued at 86.00
6. Three parcels of land in the pueblo of Candon; valued at 150.00
Total 7,896.00
That, on or about the first months of the year 1888, the defendants, without judicial authorization,
nor friendly or extrajudicial agreement, took upon themselves the administration and enjoyment of
the said properties and collected the rents, fruits, and products thereof, to the serious detriment of
the plaintiffs' interest; that, notwithstanding the different and repeated demands extrajudicially
made upon Matilde Ortiz to divide the aforementioned properties with the plaintiff Vicente and to
deliver to the latter the one-half thereof, together with one-half of the fruits and rents collected
therefrom, the said defendant and her husband, the self-styled administrator of the properties
mentioned, had been delaying the partition and delivery of the said properties by means of unkept
promises and other excuses; and that the plaintiffs, on account of the extraordinary delay in the
delivery of one-half of said properties, or their value in cash, as the case might be, had suffered
losses and damages in the sum of P8,000. Said counsel for the plaintiffs therefore asked that
judgment be rendered by sentencing the defendants, Gaspar de Bartolome, and Matilde Ortiz
Felin de Bartolome, to restore and deliver to the plaintiffs one-half of the total value in cash,
according to appraisal, of the undivided property specified, which one-half amounted
approximately to P3,948, or if deemed proper, to recognize the plaintiff Vicenta Ortiz to be vested
with the full and absolute right of ownership to the said undivided one-half of the properties in
question, as universal testamentary heir thereof together with the defendant Matilde Ortiz, to
indemnify the plaintiffs in the sum of P8,000, for losses and damages, and to pay the costs.
Counsel for the defendants, in his answer denied the facts alleged in paragraphs 1, 4, 6, 7, and 8
thereof, inasmuch as, upon the death of the litigating sister's brother Manuel, their mother, who
was still living, was his heir by force of law, and the defendants had never refused to give to the
plaintiff Vicente Ortiz her share of the said properties; and stated that he admitted the facts alleged
in paragraph 2, provided it be understood, however, that the surname of the defendant's mother
was Felin, and not Feliu, and that Miguel Ortiz died in Spain, and not in Vigan; that he also
admitted paragraph 3 of the complaint, with the difference that the said surname should be Felin,
and likewise paragraph 5, except the part thereof relating to the personal property and the jewelry,
since the latter had not yet been divided; that the said jewelry was in the possession of the
plaintiffs and consisted of: one Lozada gold chronometer watch with a chain in the form of a bridle
curb and a watch charm consisting of the engraving of a postage stamp on a stone mounted in
gold and bearing the initials M. O., a pair of cuff buttons made of gold coins, four small gold
buttons, two finger rings, another with the initials M. O., and a gold bracelet; and that the
defendants were willing to deliver to the plaintiffs, in conformity with their petitions, one-half of the
total value in cash, according to appraisement, of the undivided real properties specified in
paragraph 5, which half amounted to P3,948.
In a special defense said counsel alleged that the defendants had never refused to divide the said
property and had in fact several years before solicited the partition of the same; that, from 1886 to
1901, inclusive, there was collected from the property on Calle Escolta the sum of 288 pesos,
besides a few other small amounts derived from other sources, which were delivered to the
plaintiffs with other larger amounts, in 1891, and from the property on Calle Washington, called La
Quinta, 990.95 pesos, which proceeds, added together, made a total of 1,278.95 pesos, saving
error or omission; that, between the years abovementioned, Escolta, and that on Calle
Washington, La Quinta, 376.33, which made a total of 1,141.71, saving error or omission; that, in
1897, the work of reconstruction was begun of the house on Calle Escolta, which been destroyed
by an earthquake, which work was not finished until 1903 and required an expenditure on the part
of the defendant Matilde Ortiz, of 5,091.52 pesos; that all the collections made up to August 1,
1905, including the rent from the stores, amounted to only P3,654.15, and the expenses, to
P6,252.32, there being, consequently, a balance of P2,598.17, which divided between the sisters,
the plaintiff and the defendant, would make the latter's share P1,299.08; that, as shown by the
papers kept by the plaintiffs, in the year 1891 the defendant Bartolome presented to the plaintiffs a
statement in settlements of accounts, and delivered to the person duly authorized by the latter for
the purpose, the sum of P2,606.29, which the said settlement showed was owing his principals,
from various sources; that, the defendant Bartolome having been the administrator of the
undivided property claimed by the plaintiffs, the latter were owing the former legal remuneration of
the percentage allowed by law for administration; and that the defendants were willing to pay the
sum of P3,948, one-half of the total value of the said properties, deducting therefrom the amount
found to be owing them by the plaintiffs, and asked that judgment be rendered in their favor to
enable them to recover from the latter that amount, together with the costs and expenses of the
suit.
The defendants, in their counter claim, repeated each and all of the allegations contained in each
of the paragraphs of section 10 of their answer; that the plaintiffs were obliged to pay to the
administrator of the said property the remuneration allowed him by law; that, as the revenues
collected by the defendants amounted to no more than P3,654.15 and the expenditures incurred
by them, to P6,252.32, it followed that the plaintiffs owed the defendants P1,299.08, that is one-
half of the difference between the amount collected from and that extended on the properties, and
asked that judgment be therefore rendered in their behalf to enable them to collect this sum from
the plaintiffs, Ricardo Pardell and Vicenta Ortiz, with legal interest thereon from December 7, 1904,
the date when the accounts were rendered, together with the sums to which the defendant
Bartolome was entitled for the administration of the undivided properties in question.
By a written motion of August 21, 1905, counsel for the plaintiffs requested permission to amend
the complaint by inserting immediately after the words "or respective appraisal," fifth line of
paragraph 5, the phrase "in cash in accordance with the assessed value," and likewise further to
amend the same, in paragraph 6 thereof, by substituting the following word in lieu of the petition
for the remedy sought: "By reason of all the foregoing, I beg the court to be pleased to render the
judgment by sentencing the defendants, Gaspar de Bartolome and Matilde Ortiz Felin de
Bartolome, to restore and deliver to the plaintiffs an exact one-half of the total vale of the undivided
properties described in the complaint, such value to be ascertained by the expert appraisal of two
competent persons, one of whom shall be appointed by the plaintiffs and the other by the
defendants, and, in case of disagreement between these two appointees such value shall be
determined by a third expert appraiser appointed by the court, or, in a proper case, by the price
offered at public auction; or, in lieu thereof, it is requested that the court recognize the plaintiff,
Vicenta Ortiz, to be vested with a full and absolute right to an undivided one-half of the said
properties; furthermore, it is prayed that the plaintiffs be awarded an indemnity of P8,000 for
losses and damages, and the costs." Notwithstanding the opposition of the defendants, the said
amendment was admitted by the court and counsel for the defendants were allowed to a period of
three days within which to present a new answer. An exception was taken to this ruling.
The proper proceedings were had with reference to the valuation of the properties concerned in
the division sought and incidental issues were raised relative to the partition of some of them and
their award to one or the other of the parties. Due consideration was taken of the averments and
statements of both parties who agreed between themselves, before the court, that any of them
might at any time acquire, at the valuation fixed by the expert judicial appraiser, any of the
properties in question, there being none in existence excluded by the litigants. The court, therefore,
by order of December 28, 1905, ruled that the plaintiffs were entitled to acquire, at the valuation
determined by the said expert appraiser, the building known as La Quinta, the lot on which it
stands and the warehouses and other improvements comprised within the inclosed land, and the
seeds lands situated in the pueblos of Vigan and Santa Lucia; and that the defendants were
likewise entitled to acquire the house on Calle Escolta, the lot on Calle Magallanes, and the three
parcels of land situated in the pueblo of Candon.
After this partition had been made counsel for the defendants, by a writing of March 8, 1906, set
forth: That, having petitioned for the appraisement of the properties in question for the purpose of
their partition, it was not to be understood that he desired from the exception duly entered to the
ruling made in the matter of the amendment to the complaint; that the properties retained by the
defendants were valued at P9,310, and those retained by the plaintiffs, at P2,885, one-half of
which amounts each party had to deliver to the other, as they were pro indiviso properties; that,
therefore, the defendants had to pay the plaintiffs the sum of P3,212.50, after deducting the
amount which the plaintiffs were obliged to deliver to the defendants, as one-half of the price of the
properties retained by the former; that, notwithstanding that the amount of the counterclaim for the
expenses incurred in the reconstruction of the pro indiviso property should be deducted from the
sum which the defendants had to pay the plaintiffs, the former, for the purpose of bringing the
matter of the partition to a close, would deliver to the latter, immediately upon the signing of the
instrument of purchase and sale, the sum of P3,212.50, which was one-half of the value of the
properties alloted to the defendants; such delivery, however, was not to be understood as a
renouncement of the said counterclaim, but only as a means for the final termination of the pro
indiviso status of the property.
The case having been heard, the court on October 5, 1907, rendered judgment holding that the
revenues and the expenses were compensated by the residence enjoyed by the defendant party,
that no losses or damages were either caused or suffered, nor likewise any other expense besides
those aforementioned, and absolved the defendants from the complaint and the plaintiffs from the
counterclaim, with no special finding as to costs. An exception was taken to this judgment by
counsel for the defendants who moved for a new trial on the grounds that the evidence presented
did not warrant the judgment rendered and that the latter was contrary to law. This motion was
denied, exception whereto was taken by said counsel, who filed the proper bill of exceptions, and
the same was approved and forwarded to the clerk of this court, with a transcript of the evidence.
Both of the litigating sisters assented to a partition by halves of the property left in her will by their
mother at her death; in fact, during the course of this suit, proceedings were had, in accordance
with the agreement made, for the division between them of the said hereditary property of
common ownership, which division was recognized and approved in the findings of the trial court,
as shown by the judgment appealed from.
The issues raised by the parties, aside from said division made during the trial, and which have
been submitted to this court for decision, concern: (1) The indemnity claimed for losses and
damages, which the plaintiffs allege amount to P8,000, in addition to the rents which should have
been derived from the house on Calle Escolta, Vigan; (2) the payment by the plaintiffs to the
defendants of the sum of P1,299.08, demanded by way of counterclaim, together with legal
interest thereon from December 7, 1904; (3) the payment to the husband of the defendant Matilde
Ortiz, of a percentage claimed to be due him as the administrator of the property of common
ownership; (4) the division of certain jewelry in the possession of the plaintiff Vicenta Ortiz; and (5)
the petition that the amendment be held to have been improperly admitted, which was made by
the plaintiffs in their written motion of August 21, 1905, against the opposition of the defendants,
through which admission the latter were obliged to pay the former P910.50.lawphil.net
Before entering upon an explanation of the propriety or impropriety of the claims made by both
parties, it is indispensable to state that the trial judge, in absolving the defendants from the
complaint, held that they had not caused losses and damages to the plaintiffs, and that the
revenues and the expenses were compensated, in view of the fact that the defendants had been
living for several years in the Calle Escolta house, which was pro indiviso property of joint
ownership.
By this finding absolving the defendants from the complaint, and which was acquiesced in by the
plaintiffs who made no appeal therefrom, the first issue has been decided which was raised by the
plaintiffs, concerning the indemnity for losses and damages, wherein are comprised the rents
which should have been obtained from the upper story of the said house during the time it was
occupied by the defendants, Matilde Ortiz and her husband, Gaspar de Bartolome.
Notwithstanding the acquiescence on the part of the plaintiffs, assenting to the said finding
whereby the defendants were absolved from the complaint, yet, as such absolution is based on
the compensation established in the judgment of the trial court, between the amounts which each
party is entitled to claim from the other, it is imperative to determine whether the defendant Matilde
Ortiz, as coowner of the house on Calle Escolta, was entitled, with her husband, to reside therein,
without paying to her coowner, Vicenta Ortiz, who, during the greater part of the time, lived with
her husband abroad, one-half of the rents which the upper story would have produced, had it been
rented to a stranger.
Article 394 of the Civil Code prescribes:
Each coowner may use the things owned in common, provided he uses them in
accordance with their object and in such manner as not to injure the interests of the
community nor prevent the coowners from utilizing them according to their rights.
Matilde Ortiz and her husband occupied the upper story, designed for use as a dwelling, in the
house of joint ownership; but the record shows no proof that, by so doing, the said Matilde
occasioned any detriment to the interest of the community property, nor that she prevented her
sister Vicenta from utilizing the said upper story according to her rights. It is to be noted that the
stores of the lower floor were rented and accounting of the rents was duly made to the plaintiffs.
Each coowner of realty held pro indiviso exercises his rights over the whole property and may use
and enjoy the same with no other limitation than that he shall not injure the interests of his
coowners, for the reason that, until a division be made, the respective part of each holder can not
be determined and every one of the coowners exercises, together with his other coparticipants,
joint ownership over the pro indiviso property, in addition to his use and enjoyment of the same.
As the hereditary properties of the joint ownership of the two sisters, Vicenta Ortiz, plaintiff, and
Matilde Ortiz, defendant, were situated in the Province of Ilocos Sur, and were in the care of the
last named, assisted by her husband, while the plaintiff Vicenta with her husband was residing
outside of the said province the greater part of the time between 1885 and 1905, when she left
these Islands for Spain, it is not at all strange that delays and difficulties should have attended the
efforts made to collect the rents and proceeds from the property held in common and to obtain a
partition of the latter, especially during several years when, owing to the insurrection, the country
was in a turmoil; and for this reason, aside from that founded on the right of coownership of the
defendants, who took upon themselves the administration and care of the properties of joint
tenancy for purposes of their preservation and improvement, these latter are not obliged to pay to
the plaintiff Vicenta one-half of the rents which might have been derived from the upper of the
story of the said house on Calle Escolta, and, much less, because one of the living rooms and the
storeroom thereof were used for the storage of some belongings and effects of common
ownership between the litigants. The defendant Matilde, therefore, in occupying with her husband
the upper floor of the said house, did not injure the interests of her coowner, her sister Vicenta, nor
did she prevent the latter from living therein, but merely exercised a legitimate right pertaining to
her as coowner of the property.
Notwithstanding the above statements relative to the joint-ownership rights which entitled the
defendants to live in the upper story of the said house, yet in view of the fact that the record shows
it to have been proved that the defendant Matilde's husband, Gaspar de Bartolome, occupied for
four years a room or a part of the lower floor of the same house on Calle Escolta, using it as an
office for the justice of the peace, a position which he held in the capital of that province, strict
justice, requires that he pay his sister-in-law, the plaintiff, one half of the monthly rent which the
said quarters could have produced, had they been leased to another person. The amount of such
monthly rental is fixed at P16 in accordance with the evidence shown in the record. This
conclusion as to Bartolome's liability results from the fact that, even as the husband of the
defendant coowner of the property, he had no right to occupy and use gratuitously the said part of
the lower floor of the house in question, where he lived with his wife, to the detriment of the plaintiff
Vicenta who did not receive one-half of the rent which those quarters could and should have
produced, had they been occupied by a stranger, in the same manner that rent was obtained from
the rooms on the lower floor that were used as stores. Therefore, the defendant Bartolome must
pay to the plaintiff Vicenta P384, that is, one-half of P768, the total amount of the rents which
should have been obtained during four years from the quarters occupied as an office by the justice
of the peace of Vigan.
With respect to the second question submitted for decision to this court, relative to the payment of
the sum demanded as a counterclaim, it was admitted and proved in the present case that, as a
result of a serious earthquake on August 15, 1897, the said house on Calle Escolta was left in
ruins and uninhabitable, and that, for its reconstruction or repair, the defendants had to expend the
sum of P6,252.32. This expenditure, notwithstanding that it was impugned, during the trial, by the
plaintiffs, was duly proved by the evidence presented by the defendants. Evidence, unsuccessfully
rebutted, was also introduced which proved that the rents produced by all the rural and urban
properties of common ownership amounted, up to August 1, 1905, to the sum of P3,654.15 which,
being applied toward the cost of the repair work on the said house, leaves a balance of P2,598.17,
the amount actually advanced by the defendants, for the rents collected by them were not
sufficient for the termination of all the work undertaken on the said building, necessary for its
complete repair and to replace it in a habitable condition. It is therefore lawful and just that the
plaintiff Vicenta Ortiz, who was willing to sell to her sister Matilde for P1,500, her share in the
house in question, when it was in a ruinous state, should pay the defendants one-half of the
amount expanded in the said repair work, since the building after reconstruction was worth P9,000,
according to expert appraisal. Consequently, the counterclaim made by the defendants for the
payment to them of the sum of P1,299.08, is a proper demand, though from this sum a reduction
must be made of P384, the amount of one-half of the rents which should have been collected for
the use of the quarters occupied by the justice of the peace, the payment of which is incumbent
upon the husband of the defendant Matilde, as aforesaid, and the balance remaining, P915.08, is
the amount which the plaintiff Vicenta must pay to the defendants.
The defendants claim to be entitled to the collection of legal interest on the amount of the
counterclaim, from December 7, 1904. This contention can not be sustained, inasmuch as, until
this suit is finally decided, it could not be known whether the plaintiffs would or would not be
obliged to pay the sum whatever in reimbursement of expenses incurred by the plaintiffs in the
repair work on the said house on Calle Escolta, whether or not the defendants, in turn, were
entitled to collect any such amount, and, finally, what the net sum would be which the plaintiff's
might have to pay as reimbursement for one-half of the expenditure made by the defendants. Until
final disposal of the case, no such net sum can be determined, nor until then can the debtor be
deemed to be in arrears. In order that there be an obligation to pay legal interest in connection
with a matter at issue between the parties, it must be declared in a judicial decision from what date
the interest will be due on the principal concerned in the suit. This rule has been established by
the decisions of the supreme court of Spain, in reference to articles 1108, 1109, and 1110 of the
Civil Code, reference on April 24, 1867, November 19, 1869, and February 22, 1901.
With regard to the percentage, as remuneration claimed by the husband of the defendant Matilde
for his administration of the property of common ownership, inasmuch as no stipulation whatever
was made in the matter by and between him and his sister-in-law, the said defendant, the claimant
is not entitled to the payment of any remuneration whatsoever. Of his own accord and as an
officious manager, he administered the said pro indiviso property, one-half of which belonged to
his wife who held it in joint tenancy, with his sister-in-law, and the law does not allow him any
compensation as such voluntary administrator. He is merely entitled to a reimbursement for such
actual and necessary expenditures as he may have made on the undivided properties and an
indemnity for the damages he may have suffered while acting in that capacity, since at all events it
was his duty to care for and preserve the said property, half of which belonged to his wife; and in
exchange for the trouble occasioned him by the administration of his sister-in-law's half of the said
property, he with his wife resided in the upper story of the house aforementioned, without payment
of one-half of the rents said quarters might have produced had they been leased to another
person.
With respect to the division of certain jewelry, petitioned for by the defendants and appellants only
in their brief in this appeal, the record of the proceedings in the lower court does not show that the
allegation made by the plaintiff Vicenta is not true, to the effect that the deceased mother of the
litigant sisters disposed of this jewelry during her lifetime, because, had she not done so, the will
made by the said deceased would have been exhibited in which the said jewelry would have been
mentioned, at least it would have been proved that the articles in question came into the
possession of the plaintiff Vicenta without the expressed desire and the consent of the deceased
mother of the said sisters, for the gift of this jewelry was previously assailed in the courts, without
success; therefore, and in view of its inconsiderable value, there is no reason for holding that the
said gift was not made.
As regards the collection of the sum of P910.50, which is the difference between the assessed
value of the undivided real properties and the price of the same as determined by the judicial
expert appraiser, it is shown by the record that the ruling of the trial judge admitting the
amendment to the original complaint, is in accord with the law and principles of justice, for the
reason that any of the coowners of a pro indiviso property, subject to division or sale, is entitled to
petition for its valuation by competent expert appraisers. Such valuation is not prejudicial to any of
the joint owners, but is beneficial to their interests, considering that, as a general rule, the
assessed value of a building or a parcel of realty is less than the actual real value of the property,
and this being appraiser to determine, in conjunction with the one selected by the plaintiffs, the
value of the properties of joint ownership. These two experts took part in the latter proceedings of
the suit until finally, and during the course of the latter, the litigating parties agreed to an amicable
division of the pro indiviso hereditary property, in accordance with the price fixed by the judicial
expert appraiser appointed as a third party, in view of the disagreement between and
nonconformity of the appraisers chosen by the litigants. Therefore it is improper now to claim a
right to the collection of the said sum, the difference between the assessed value and that fixed by
the judicial expert appraiser, for the reason that the increase in price, as determined by this latter
appraisal, redounded to the benefit of both parties.
In consideration of the foregoing, whereby the errors assigned to the lower court have been duly
refuted, it is our opinion that, with a partial reversal of the judgment appealed from, in so far as it
absolves the plaintiffs from the counterclaim presented by the defendants, we should and hereby
do sentence the plaintiffs to the payment of the sum of P915.08, the balance of the sum claimed
by the defendants as a balance of the one-half of the amount which the defendants advanced for
the reconstruction or repair of the Calle Escolta house, after deducting from the total of such sum
claimed by the latter the amount of P384 which Gaspar de Bartolome, the husband of the
defendant Matilde, should have paid as one-half of the rents due for his occupation of the quarters
on the lower floor of the said house as an office for the justice of the peace court of Vigan; and we
further find: (1) That the defendants are not obliged to pay one-half of the rents which could have
been obtained from the upper story of the said house; (2) that the plaintiffs can not be compelled
to pay the legal interest from December 7, 1904, on the sum expanded in the reconstruction of the
aforementioned house, but only the interest fixed by law, at the rate of 6 per cent per annum, from
the date of the judgment to be rendered in accordance with this decision; (3) that the husband of
the defendant Matilde Ortiz is not entitled to any remuneration for the administration of the pro
indiviso property belonging to both parties; (4) that, neither is he entitled to collect from the
plaintiffs the sum of P910.50, the difference between the assessed valuation and the price set by
the expert appraisal solicited by the plaintiffs in their amendment to the complaint; and, (5) that no
participation shall be made of jewelry aforementioned now in the possession of the plaintiff Vicenta
Ortiz. The said judgment, as relates to the points appealed, is affirmed, in so far as its findings
agree with those of this decision, and is reversed, in so far as they do not. No special finding is
made regarding the costs of both instances. So ordered.
Arellano, C.J., Mapa, Johnson, Carson and Trent, JJ.,
 Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-32047 November 1, 1930
MANUEL MELENCIO, MARIANO MELENCIO, PURA MELENCIO, and CARIDAD
MELENCIO, plaintiffs-appellants,
vs.
DY TIAO LAY, defendant-appellee.
OSTRAND, J.:
On August 1,1927, the plaintiffs, Manuel, Mariano, Pura and Caridad Melencio, brought the
present action against the defendant-appellee, Dy Tiao Lay for the recovery of the possession of a
parcel of land situated in the town of Cabanatuan, Nueva Ecija, and containing an area of
4,628.25 square meters. The plaintiffs further demand a monthly rental of P300 for the use and
occupation of the parcel from May, 1926, until the date of the surrender to them of the possession
thereof; and that if it is found that the said appellee was occupying the said parcel of land by virtue
of a contract of lease, such contract should be declared null and void for lack of consent,
concurrence, and ratification by the owners thereof.
In his answer, the defendant pleaded the general issue, and as special defenses, he alleged in
substance that he was occupying the said tract of land by virtue of a contract of lease executed on
July 24,1905, in favor of his predecessor in interest, by Ruperta Garcia, Pedro Melencio, Juliana
Melencio, and Ruperta Melencio under the terms specified therein, and which contract is still in
force; that Liberata Macapagal, the mother of the plaintiffs, in her capacity as judicial administratrix
of the estate of Ramon Melencio, one of the original coowners of the parcel of land in question,
actually recognized and ratified the existence and validity of the contract aforesaid by virtue of the
execution of a public document by her on or about November 27,1920, and by collecting from the
assignees of the original lessee the monthly rent for the premises until April 30, 1926; and that
said defendant deposits with the clerk of court the sum of P20.20 every month as rent thereof and
that as a counterclaim, he seeks the recovery of P272 for goods and money delivered by him to
the plaintiffs.
The plaintiffs filed a reply to the answer alleging, among other things, that Ruperta Garcia was not
one of the coowners of the land in question; that the person who signed the alleged contract of
lease never represented themselves as being the sole and exclusive owners of the land subject to
the lease as alleged by the defendant in his answer; that the said contract of lease of July 24,1905,
is null and void for being executed without the intervention and consent of two coowners, Ramon
Melencio and Jose P. Melencio, and without the marital consent of the husbands of Juliana and
Ruperta Melencio; that the lessee has repeatedly violated the terms and conditions of the said
contract; and that Liberata Macapagal, in her capacity as administratrix of the property of her
deceased husband, could not lawfully and legally execute a contract of lease with the conditions
and terms similar to that of the one under consideration, and that from this it follows that she could
not ratify the said lease as claimed by the defendant.
On January 21,1928, Liberata Macapagal Viuda de Melencio, duly appointed and qualified as
administratrix of the estate of her deceased husband, Ramon Melencio, filed a petition praying to
be allowed to join the plaintiffs as party to the present case, which petition was granted in open
court on January 31,1928. Her amended complaint of intervention of February 14,1928, contains
allegations similar to those alleged in the complaint of the original plaintiffs, and she further alleges
that the defendant-appellee has occupied the land in question ever since November, 1920, under
and by virtue of a verbal contract of lease for a term from month to month. To this complaint of
intervention, the defendant-appellee filed an answer reproducing the allegations contained in his
answer reproducing the allegations contained in his answer to the complaint of the original
plaintiffs and setting up prescription as a further special defense.
It appears from the evidence that the land in question was originally owned by one Julian Melencio.
He died prior to the year 1905 leaving his widow, Ruperta Garcia, and his five children, Juliana,
Ramon, Ruperta, Pedro R., and Emilio Melencio. Emilio Melencio also died before 1905, his son
Jose P. Melencio, then a minor, succeeding to his interest in the said parcel of land by
representation. A question has been raised as to whether the land was community property of the
marriage of Julian Melencio and Ruperta Garcia, but the evidence is practically undisputed that
Ruperta Garcia in reality held nothing but a widow's usufruct in the land.
On July 24,1905, Ruperta Garcia, Pedro R. Melencio, Juliana Melencio, and Ruperta Melencio
executed a contract of lease of the land in favor of one Yap Kui Chin, but neither Jose P. Melencio
nor Ramon Melencio were mentioned in the lease. The term of the lease was for twenty years,
extendible for a like period at the option of the lessee. The purpose of the lessee was to establish
a rice mill on the land, with the necessary buildings for warehouses and for quarters for the
employees, and it was further stipulated that at the termination of the original period of the lease,
or the extension therof, the lessors might purchase all the buildings and improvements on the land
at a price to be fixed by experts appointed by the parties, but that if the lessors should fail to take
advantage of that privilege, the lease would continue for another and further period of twenty years.
The document was duly acknowledged but was never recorded with the register of deeds. The
original rent agreed upon was P25 per month, but by reason of the construction of a street through
the land, the monthly rent was reduced of P20.20.
Shortly after the execution of the lease, the lessee took possession of the parcel in question and
erected the mill as well as the necessary buildings, and it appears that in matters pertaining to the
lease, he dealt with Pedro R. Melencio, who from 1905 until his death in 1920, acted as manager
of the property held in common by the heirs of Julian Melencio and Ruperta Garcia. The original
lessee, Yap Kui Chin, died in 1912, and the lease, as well as the other property, was transferred to
Uy Eng Jui who again transferred it to Uy Eng Jui & Co., an unregistered partnership. Finally the
lease came into the hands of Dy Tiao Lay, the herein defendant-appellee.
Ramon Melencio died in 1914, and his widow, Liberata Macapagal, was appointed administratrix
of his estate. In 1913 the land which includes the parcel in question was registered under the
Torrens system. The lease was not mentioned in the certificate of title, but it was stated that one
house and three warehouses on the land were the property of Yap Kui Chin.
In 1920 the heirs of Julian Melencio made an extrajudicial partition of parts of the inheritance, and
among other things, the land here in question fell to the share of the children of Ramon Melencio,
who are the original plaintiffs in the present case. Their mother, Liberata Macapagal, as
administratrix of the estate of her deceased husband, Ramon, collected the rent for the lease at
the rate of P20.20 per month until the month of May,1926, when she demanded of the lessee that
the rent should be increased to P300 per month, and she was then informed by the defendant that
a written lease existed and that according to the terms thereof, the defendant was entitled to an
extension of the lease at the original rental. The plaintiffs insisted that they never had any
knowledge of the existence of such a contract of lease and maintained that in such case the lease
was executed without their consent and was void. It may be noted that upon careful search, a
copy of the contract of lease was found among the papers of the deceased Pedro R, Melencio.
Thereafter the present action was brought to set aside the lease and to recover possession of the
land. Upon trial, the court below rendered judgment in favor of the defendant declaring the lease
valid and ordering the plaintiffs to pay the P272 demanded by the defendant in his counterclaim.
From this judgment the plaintiffs appealed.
The contention of the appellants is that the aforesaid contract of lease (Exhibit C) is null and void
for the following reasons:
1. That Exhibit C calls for an alteration of the property in question and therefore ought to
have been signed by all the coowners as by law required in the premises.
2. That the validity and fulfillment of the said agreement of lease were made to depend
upon the will of the lessee exclusively.
3. That the said contract of lease being for a term of over six years, the same is null and
void pursuant to the provision of article 1548 of the Civil Code.
4. That the duration of the same is unreasonably long, thus being against public policy.
5. That the defendant-appellee and his predecessors in interest repeatedly violated the
provisions of the agreement.
The first proposition is based on article 397 of the Civil Code which provides that "none of the
owners shall, without the consent of the others, make any alterations in the common property even
though such alterations might be advantageous to all." We do not think that the alterations are of
sufficient importance to nullify the lease, especially so since none of the coowners objected to
such alterations until over twenty years after the execution of the contract of lease. The decision of
this court in the case of Enriquez vs. A. S. Watson and Co. (22 Phil., 623), contains a full
discussion of the effect of alterations of leased community property, and no further discussion
upon the point need here be considered.
The second proposition is likewise of little merit. Under the circumstances, the provision in the
contract that the lessee, at any time before he erected any building on the land, might rescind the
lease, can hardly be regarded as a violation of article 1256 of the Civil Code.
The third and fourth proposition are, in our opinion, determinative of the controversy. The court
below based its decision principally on the case of Enriquez vs. A.S. Watson & Co. (22 Phil., 623),
and on the resolution of the Direccion General de los Registros dated April 26,1907.
(Jurisprudencia Civil, vol.107, p. 222.) An examination of the Enriquez case will show that it differs
materially from the present. In that case all of the coowners of a lot and building executed a
contract of lease of the property for the term of eighteen years in favor of A. S. Watson & Co.; one
of the owners was minor, but he was represented by his legally appointed guardian, and the action
of the latter in signing the lease on behalf of the minor was formally approved by the Court of First
Instance. In the present case only a small majority of the coowners executed the lease here in
question, and according to the terms of the contract the lease might be given a duration of sixty
years; that is widely different from a lease granted by all of the coowners for a term of only
eighteen years.
The resolution of April 26,1907, is more in point. It relates to the inscription or registration of a
contract of lease of some pasture grounds. The majority of the coowners of the property executed
the lease for the term of twelve years but when the lessees presented the lease for inscription in
the registry of property, the registrar denied the inscription on the ground that the term of the lease
exceeded six years and that therefore the majority of the coowners lacked authority to grant the
lease. The Direccion General de los Registros held that the contract of lease for a period
exceeding six years, constitutes a real right subject to registry and that the lease in question was
valid.
The conclusions reached by the Direccion General led to considerable criticism and have been
overruled by a decision of the Supreme Court of Spain dated June 1,1909. In that decision the
court made the following statement of the case (translation):
The joint owners of 511 out of 1,000 parts of the realty denominated El Mortero, leased
out the whole property for twelve years to Doña Josefa de la Rosa; whereupon the Count
and Countess Trespalacios together with other coowners brought this suit to annul the
lease and, in view of the fact that the land was indivisible, prayed for its sale by public
auction and the distribution of the price so obtained; they alleged that they neither took
part nor consented to the lease; that the decision of the majority of part owners referred to
in article 398 of the Code, implies a common deliberation on the step to be taken , for to
do without it, would, even more than to do without the minority, be nothing less than
plunder; and that, even if this deliberation were not absolutely necessary, the power of the
majority would still be confined to decisions touching the management and enjoyment of
the common property, and would not include acts of ownership, such as a lease for twelve
years, which according to the Mortgage Law gives rise to a real right, which must be
recorded, and which can be performed only by the owners of the property leased.
The part owners who had executed the contract prayed in reconvention that it held valid
for all the owners in common, and if this could not be, then for all those who had signed it,
and for the rest, for the period of six years; and the Audiencia of Caceres having rendered
judgment holding the contract null and void, and ordering the sale of the realty and the
distribution of the price, the defendants appealed alleging under the third and fourth
assignments of error, that the judgment was a violation of article 398 of the Civil Code,
which is absolute and sets no limit of time for the efficacy of the decisions arrived at by
the majority of the part owners for the enjoyment of the common property, citing the
 decisions of June 30th, 1897, of July 8th,1902, and of October 30th, 1907; under the fifth
assignments of error the appellants contended that in including joint owners among those
referred to in said article, which sets certain limits to the power of leasing, in the course of
the management of another's property, the court applied article 1548 unduly; and by the
seventh assignments of error, they maintained the judgment appealed from also violated
article 1727, providing that the principal is not bound where his agent has acted beyond
his authority; whence it may be inferred that if in order to hold the contract null and void,
the majority of the part owners are looked upon as managers or agents exercising limited
powers, it must at least be conceded that in so far as the act in question lies within the
scope of their powers, it is valid; the contract cannot be annulled in toto.
The Supreme Court held that the appeal from the decision of the Audiencia of Caceres was not
well taken and expressed the following consideranda:
Considering that, although as a rule the contract of lease constitutes an act of
management, as this court has several times held, cases may yet arise, either owing to
the nature of the subject matter, or to the period of duration, which may render it
imperative to record the contract in the registry of property, in pursuance of the Mortgage
Law, where the contract of lease may give rise to a real right in favor of the lessee, and it
would then constitute such a sundering of the ownership as transcends mere
management; in such cases it must of necessity be recognized that the part owners
representing the greater portion of the property held in common have no power to lease
said property for a longer period than six years without the consent of all the coowners,
whose propriety rights, expressly recognized by the law, would by contracts of long
duration be restricted or annulled; and as under article 1548 of the Civil Code such
contracts cannot be entered into by the husband with respect to his wife's property, by the
parent or guardian with respect to that of the child or ward, and by the manager in default
of special power, since the contract of lease only produces personal obligations, and
cannot without the consent of all persons interested or express authority from the owner,
be extended to include stipulations which may alter its character, changing it into a
contract of partial alienation of the property leased;
Considering that, applying this doctrine to the case before us, one of the grounds upon
which the judgment appealed from, denying the validity of the lease made by the majority
of the part owners of the pasture land El Mortero is based, must be upheld; to wit, that the
period of duration is twelve years and the consent of all the coowners has not been
obtained; hence, the third, fourth. and fifth assignments of error are without merit; firstly,
because article 398 of the Civil Code, alleged to have been violated, refers to acts
decided upon by the majority of the part owners, touching the management and
enjoyment of the common property, and does not contradict what we have stated in the
foregoing paragraph; secondly because although the cases cited were such as arose
upon leases for more than six years, yet this point was not raised on appeal, and could
not therefore be passed upon; and thirdly, because it cannot be denied that there is an
analogy between a manager without special authority, who is forbidden by article 1548 of
the Code to give a lease for a period of over six years, and the joint owners constituting a
legal majority, who may decide to lease out the indivisible property, with respect to the
shares of the other coowners; and having come to the conclusion that the contract is null
and void, there is no need to discuss the first two assignments of error which refer to
another of the bases adopted, however erroneously, by the trial court;
Considering that the sixth assignment of error is without merit, inasmuch as the joint
ownership of property is not a sort of agency and cannot be governed by the provisions
relating to the latter contract; whence, article 1727 of the Code alleged to have been
violated, can no more be applied, than, the question of the validity or nullity of the lease
being raise, upon the contract as celebrated, it would be allowable to modify
a posteriorisome one or other of the main conditions stipulated, like that regarding the
duration of the lease, for this would amount to a novation; still less allowable would it be to
authorize diverse periods for the different persons unequally interested in the fulfillment.
Taking into consideration articles 398,1548, and 1713 of the Civil Code and following the aforesaid
decision of June 1,1909, we hold that the contract of lease here in question is null and void.
It has been suggested that by reason of prescription and by acceptance of benefits under the
lease, the plaintiffs are estopped to question the authority for making the lease.To this we may
answer that the burden of proof of prescription devolved upon the defendant and that as far as we
can find, there is no proof that Ramon Melencio and his successors ever had knowledge of the
existence of the lease in question prior to 1926. We cannot by mere suspicion conclude that they
were informed of the existence of the document and its terms; it must be remembered that under a
strict interpretation of the terms of the lease, the lessees could remain indefinitely in their tenancy
unless the lessors could purchase the mill and the buildings on the land. In such circumstances,
better evidence than that presented by the defendant in regard to the plaintiff's knowledge of the
lease must be required.
The fact that Ramon during his lifetime received his share of the products of land owned in
common with his coheirs is not sufficient proof of knowledge of the existence of the contract of
lease when it is considered that the land in question was only a small portion of a large tract which
Pedro R. Melencio was administering in connection with other community property.
The appealed judgment as to the validity of the lease is therefore reversed, and it is ordered that
the possession of the land in controversy be delivered to the intervenor Liberata Macapagal in her
capacity as administratrix of the estate of the deceased Ramon Melencio. It is further ordered that
the defendant pay to said administratrix a monthly rent of P50 for the occupation of the land from
May 1st, 1926, until the land is delivered to the administratrix. The sum of P272 demanded by the
defendant in his counterclaim may be deducted from the total amount of the rent due and unpaid.
The building erected on the land by the defendant and his predecessors in interest may be
removed by him, or otherwise disposed of, within six months from the promulgation of this decision.
Without costs. So ordered.
Avanceña, C.J., , Malcolm, Johns, Romualdez, and Villa-Real, JJ., concur.
Jonhson, J., I reserve my vote.
 Republic of the Philippines the remaining 50 per cent to be divided in equal portions among the three co-owners so that each
SUPREME COURT will receive 16.33 per cent of the gross receipts.
Manila
Because of the importance of paragraphs 9, 11 and 15 of the contract (Exh. 6), for purposes of
EN BANC reference we are reproducing them below:

G.R. No. L-3404 April 2, 1951 (9) This contract shall remain in full force and effect during all the time that it may be
necessary for the PARTY OF THE SECOND PART to fully sell the said property in small
and subdivided lots and to fully collect the purchase prices due thereon; it being
ANGELA I. TUASON, plaintiff-appellant,
understood and agreed that said lots may be rented while there are no purchasers thereof;
vs.
ANTONIO TUASON, JR., and GREGORIO ARANETA, INC., defendants-appellees.
(11) The PARTY OF THE SECOND PART (meaning Araneta Inc.) is hereby given full
power and authority to sign for and in behalf of all the said co-owners of said property all
MONTEMAYOR, J.:
contracts of sale and deeds of sale of the lots into which this property might be subdivided;
the powers herein vested to the PARTY OF THE SECOND PART may, under its own
In 1941 the sisters Angela I. Tuason and Nieves Tuason de Barreto and their brother Antonio responsibility and risk, delegate any of its powers under this contract to any of its officers,
Tuason Jr., held a parcel of land with an area of 64,928.6 sq. m. covered by Certificate of Title No. employees or to third persons;
60911 in Sampaloc, Manila, in common, each owning an undivided 1/3 portion. Nieves wanted
and asked for a partition of the common property, but failing in this, she offered to sell her 1/3
(15) No co-owner of the property subject-matter of this contract shall sell, alienate or
portion. The share of Nieves was offered for sale to her sister and her brother but both declined to
dispose of his ownership, interest or participation therein without first giving preference to
buy it. The offer was later made to their mother but the old lady also declined to buy, saying that if
the other co-owners to purchase and acquire the same under the same terms and
the property later increased in value, she might be suspected of having taken advantage of her
conditions as those offered by any other prospective purchaser. Should none of the co-
daughter. Finally, the share of Nieves was sold to Gregorio Araneta Inc., a domestic corporation,
owners of the property subject-matter of this contract exercise the said preference to
and a new Certificate of Title No. 61721 was issued in lieu of the old title No. 60911 covering the
acquire or purchase the same, then such sale to a third party shall be made subject to all
same property. The three co-owners agreed to have the whole parcel subdivided into small lots
the conditions, terms, and dispositions of this contract; provided, the PARTIES OF THE
and then sold, the proceeds of the sale to be later divided among them. This agreement is
FIRST PART (meaning Angela and Antonio) shall be bound by this contract as long as
embodied in a document (Exh. 6) entitled "Memorandum of Agreement" consisting of ten pages,
the PARTY OF THE SECOND PART, namely, the GREGORIO ARANETA, INC. is
dated June 30, 1941.
controlled by the members of the Araneta family, who are stockholders of the said
corporation at the time of the signing of this contract and/or their lawful heirs;
Before, during and after the execution of this contract (Exh. 6), Atty. J. Antonio Araneta was acting
as the attorney-in-fact and lawyer of the two co-owners, Angela I. Tuason and her brother Antonio
On September 16, 1944, Angela I. Tuason revoked the powers conferred on her attorney-in-fact
Tuason Jr. At the same time he was a member of the Board of Director of the third co-owner,
and lawyer, J. Antonio Araneta. Then in a letter dated October 19, 1946, Angela notified Araneta,
Araneta, Inc.
Inc. that because of alleged breach of the terms of the "Memorandum of Agreement" (Exh. 6) and
abuse of powers granted to it in the document, she had decided to rescind said contract and she
The pertinent terms of the contract (Exh. 6) may be briefly stated as follows: The three co-owners asked that the property held in common be partitioned. Later, on November 20, 1946, Angela filed
agreed to improve the property by filling it and constructing roads and curbs on the same and then a complaint in the Court of First Instance of Manila asking the court to order the partition of the
subdivide it into small lots for sale. Araneta Inc. was to finance the whole development and property in question and that she be given 1/3 of the same including rents collected during the
subdivision; it was prepare a schedule of prices and conditions of sale, subject to the subject to time that the same including rents collected during the time that Araneta Inc., administered said
the approval of the two other co-owners; it was invested with authority to sell the lots into which property.
the property was to be subdivided, and execute the corresponding contracts and deeds of sale; it
was also to pay the real estate taxes due on the property or of any portion thereof that remained
The suit was administered principally against Araneta, Inc. Plaintiff's brother, Antonio Tuason Jr.,
unsold, the expenses of surveying, improvements, etc., all advertising expenses, salaries of
one of the co-owners evidently did not agree to the suit and its purpose, for he evidently did not
personnel, commissions, office and legal expenses, including expenses in instituting all actions to
agree to the suit and its purpose, for he joined Araneta, Inc. as a co-defendant. After hearing and
eject all tenants or occupants on the property; and it undertook the duty to furnish each of the two
after considering the extensive evidence introduce, oral and documentary, the trial court presided
co-owners, Angela and Antonio Tuason, copies of the subdivision plans and the monthly sales and
over by Judge Emilio Peña in a long and considered decision dismissed the complaint without
rents and collections made thereon. In return for all this undertaking and obligation assumed by
pronouncement as to costs. The plaintiff appealed from that decision, and because the property is
Araneta Inc., particularly the financial burden, it was to receive 50 per cent of the gross selling
valued at more than P50,000, the appeal came directly to this Court.
price of the lots, and any rents that may be collected from the property, while in the process of sale,
Some of the reasons advanced by appellant to have the memorandum contract (Exh. 6) declared
null and void or rescinded are that she had been tricked into signing it; that she was given to
understand by Antonio Araneta acting as her attorney-in-fact and legal adviser that said contract
would be similar to another contract of subdivision of a parcel into lots and the sale thereof entered
into by Gregorio Araneta Inc., and the heirs of D. Tuason, Exhibit "L", but it turned out that the two
contracts widely differed from each other, the terms of contract Exh. "L" being relatively much
more favorable to the owners therein the less favorable to Araneta Inc.; that Atty. Antonio Araneta
was more or less disqualified to act as her legal adviser as he did because he was one of the
officials of Araneta Inc., and finally, that the defendant company has violated the terms of the
contract (Exh. 6) by not previously showing her the plans of the subdivision, the schedule of prices
and conditions of the sale, in not introducing the necessary improvements into the land and in not
delivering to her her share of the proceeds of the rents and sales.
We have examined Exh. "L" and compared the same with the contract (Exh. 6) and we agree with
the trial court that in the main the terms of both contracts are similar and practically the same.
Moreover, as correctly found by the trial court, the copies of both contracts were shown to the
plaintiff Angela and her husband, a broker, and both had every opportunity to go over and
compare them and decide on the advisability of or disadvantage in entering into the contract (Exh.
6); that although Atty. Antonio Araneta was an official of the Araneta Inc.; being a member of the
Board of Directors of the Company at the time that Exhibit "6" was executed, he was not the party
with which Angela contracted, and that he committed no breach of trust. According to the evidence
Araneta, the pertinent papers, and sent to her checks covering her receive the same; and that as a
matter of fact, at the time of the trial, Araneta Inc., had spent about P117,000 in improvement and
had received as proceeds on the sale of the lots the respectable sum of P1,265,538.48. We quote
with approval that portion of the decision appealed from on these points:
The evidence in this case points to the fact that the actuations of J. Antonio Araneta in
connection with the execution of exhibit 6 by the parties, are above board. He committed
nothing that is violative of the fiduciary relationship existing between him and the plaintiff.
The act of J. Antonio Araneta in giving the plaintiff a copy of exhibit 6 before the same
was executed, constitutes a full disclosure of the facts, for said copy contains all that
appears now in exhibit 6.
Plaintiff charges the defendant Gregorio Araneta, Inc. with infringing the terms of the
contract in that the defendant corporation has failed (1) to make the necessary
improvements on the property as required by paragraphs 1 and 3 of the contract; (2) to
submit to the plaintiff from time to time schedule of prices and conditions under which the
subdivided lots are to be sold; and to furnish the plaintiff a copy of the subdivision plans, a
copy of the monthly gross collections from the sale of the property.
The Court finds from the evidence that he defendant Gregorio Araneta, Incorporated has
substantially complied with obligation imposed by the contract exhibit 6 in its paragraph 1,
and that for improvements alone, it has disbursed the amount of P117,167.09. It has
likewise paid taxes, commissions and other expenses incidental to its obligations as
denied in the agreement.
With respect to the charged that Gregorio Araneta, Incorporated has failed to submit to
plaintiff a copy of the subdivision plains, list of prices and the conditions governing the
sale of subdivided lots, and monthly statement of collections form the sale of the lots, the
Court is of the opinion that it has no basis. The evidence shows that the defendant
corporation submitted to the plaintiff periodically all the data relative to prices and
conditions of the sale of the subdivided lots, together with the amount corresponding to
her. But without any justifiable reason, she refused to accept them. With the indifferent
attitude adopted by the plaintiff, it was thought useless for Gregorio Araneta, Incorporated
to continue sending her statement of accounts, checks and other things. She had shown
on various occasions that she did not want to have any further dealings with the said
corporation. So, if the defendant corporation proceeded with the sale of the subdivided
lots without the approval of the plaintiff, it was because it was under the correct
impression that under the contract exhibit 6 the decision of the majority co-owners is
binding upon all the three.
The Court feels that recission of the contract exhibit 6 is not minor violations of the terms
of the agreement, the general rule is that "recission will not be permitted for a slight or
casual breach of the contract, but only for such breaches as are so substantial and
fundamental as to defeat the object of the parties in making the agreement" (Song Fo &
Co. vs. Hawaiian-Philippine Co., 47 Phil. 821).
As regards improvements, the evidence shows that during the Japanese occupation from 1942
and up to 1946, the Araneta Inc. although willing to fill the land, was unable to obtain the
equipment and gasoline necessary for filling the low places within the parcel. As to sales, the
evidence shows that Araneta Inc. purposely stopped selling the lots during the Japanese
occupantion, knowing that the purchase price would be paid in Japanese military notes; and Atty.
Araneta claims that for this, plaintiff should be thankfull because otherwise she would have
received these notes as her share of the receipts, which currency later became valueles.
But the main contention of the appellant is that the contract (Exh. 6) should be declared null and
void because its terms, particularly paragraphs 9, 11 and 15 which we have reproduced, violate
the provisions of Art. 400 of the Civil Code, which for the purposes of reference we quote below:
ART. 400. No co-owner shall be obliged to remain a party to the community. Each may, at
any time, demand the partition of the thing held in common.
Nevertheless, an agreement to keep the thing undivided for a specified length of time, not
exceeding ten years, shall be valid. This period may be a new agreement.
We agree with the trial court that the provisions of Art. 400 of the Civil Code are not applicable.
The contract (Exh., 6) far from violating the legal provision that forbids a co-owner being obliged to
remain a party to the community, precisely has for its purpose and object the dissolution of the co-
ownership and of the community by selling the parcel held in common and dividing the proceeds
of the sale among the co-owners. The obligation imposed in the contract to preserve the co-
ownership until all the lots shall have been sold, is a mere incident to the main object of dissolving
the co-owners. By virtue of the document Exh. 6, the parties thereto practically and substantially
entered into a contract of partnership as the best and most expedient means of eventually
dissolving the co-ownership, the life of said partnership to end when the object of its creation shall
have been attained.
This aspect of the contract is very similar to and was perhaps based on the other agreement or
contract (Exh. "L") referred to by appellant where the parties thereto in express terms entered into
partnership, although this object is not expressed in so many words in Exh. 6. We repeat that we
see no violation of Art. 400 of the Civil Code in the parties entering into the contract (Exh. 6) for
the very reason that Art. 400 is not applicable.

Looking at the case from a practical standpoint as did the trial court, we find no valid ground for
the partition insisted upon the appellant. We find from the evidence as was done by the trial court
that of the 64,928.6 sq. m. which is the total area of the parcel held in common, only 1,600 sq. m.
or 2.5 per cent of the entire area remained unsold at the time of the trial in the year 1947, while the
great bulk of 97.5 per cent had already been sold. As well observed by the court below, the
partnership is in the process of being dissolved and is about to be dissolved, and even assuming
that Art. 400 of the Civil Code were applicable, under which the parties by agreement may agree
to keep the thing undivided for a period not exceeding 10 years, there should be no fear that the
remaining 1,600 sq. m. could not be disposed of within the four years left of the ten-years period
fixed by Art. 400.

We deem it unnecessary to discuss and pass upon the other points raised in the appeal and which
counsel for appellant has extensively and ably discussed, citing numerous authorities. As we have
already said, we have viewed the case from a practical standpoint, brushing aside technicalities
and disregarding any minor violations of the contract, and in deciding the case as we do, we are
fully convinced that the trial court and this Tribunal are carrying out in a practical and expeditious
way the intentions and the agreement of the parties contained in the contract (Exh. 6), namely, to
dissolve the community and co-ownership, in a manner most profitable to the said parties.

In view of the foregoing, the decision appealed from is hereby affirmed. There is no
pronouncement as to costs.

So ordered.

Pablo, Bengzon, Padilla, Tuason, Reyes, Jugo and Bautista Angelo, JJ., concur.
Paras, C. J., I certify that Mr. Justice Feria voted to affirm.
 Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 101522 May 28, 1993
LEONARDO MARIANO, AVELINA TIGUE, LAZARO MARIANO, MERCEDES SAN PEDRO,
DIONISIA M. AQUINO, and JOSE N.T. AQUINO, petitioners,
vs.
HON. COURT OF APPEALS, (Sixteenth Division), GRACE GOSIENGFIAO, assisted by her
husband GERMAN GALCOS; ESTER GOSIENGFIAO, assisted by her husband AMADOR
BITONA; FRANCISCO GOSIENGFIAO, JR., NORMA GOSIENGFIAO, and PINKY ROSE
GUENO, respondents.
NOCON, J.:
Before Us is a petition foe review of the decision, dated May 13, 1991 of the Court of Appeals in
CA-G.R. CV No. 13122, entitled Grace Gosiengfiao, et al. v. Leonardo Mariano v. Amparo
Gosiengfiao 1 raising as issue the distinction between Article 1088 2 and Article 16203 of the Civil
Code.
The Court of Appeals summarized the facts as follows:
It appears on record that the decedent Francisco Gosiengfiao is the registered
owner of a residential lot located at Ugac Sur, Tuguegarao, Cagayan, particularly
described as follows, to wit:
"The eastern portion of Lot 1351, Tuguegarao Cadastre, and
after its segregation now designated as Lot 1351-A, Plan PSD-
67391, with an area of 1,1346 square meters."
and covered by Transfer Certificate of Title No. T-2416 recorded in the Register
of Deeds of Cagayan.
The lot in question was mortgaged by the decedent to the Rural Bank of
Tuguegarao (designated as Mortgagee bank, for brevity) on several occasions
before the last, being on March 9, 1956 and 29, 1958.
On August 15, 1958, Francisco Gosiengfiao died intestate survived by his heirs,
namely: Third-Party Defendants: wife Antonia and Children Amparo, Carlos,
Severino and herein plaintiffs-appellants Grace, Emma, Ester, Francisco, Jr.,
Norma, Lina (represented by daughter Pinky Rose), and Jacinto.
The loan being unpaid, the lot in dispute was foreclosed by the mortgagee bank
and in the foreclosure sale held on December 27, 1963, the same was awarded
to the mortgagee bank as the highest bidder.
On February 7, 1964, third-party defendant Amparo Gosiengfiao-Ibarra
redeemed the property by paying the amount of P1,347.89 and the balance of
P423.35 was paid on December 28, 1964 to the mortgagee bank.
On September 10, 1965, Antonia Gosiengfiao on her behalf and that of her minor
children Emma, Lina, Norma together with Carlos and Severino executed a
"Deed of Assignment of the Right of Redemption" in favor of Amparo G. Ibarra
appearing in the notarial register of Pedro (Laggui) as Doc. No. 257, Page No. 6,
Book No. 8, Series of 1965.
On August 15, 1966, Amparo Gosiengfiao sold the entire property to defendant
Leonardo Mariano who subsequently established residence on the lot subject of
this controversy. It appears in the Deed of Sale dated August 15, 1966 that
Amparo, Antonia, Carlos and Severino were signatories thereto.
Sometime in 1982, plaintiff-appellant Grace Gosiengfiao learned of the sale of
said property by the third-party defendants. She went to the Barangay Captain
and asked for a confrontation with defendants Leonardo and Avelina Mariano to
present her claim to said property.
On November 27, 1982, no settlement having been reached by the parties, the
Barangay captain issued a certificate to file action.
On December 8, 1982, defendant Leonardo Mariano sold the same property to
his children Lazaro F. Mariano and Dionicia M. Aquino as evidenced by a Deed
of Sale notarized by Hilarion L. Aquino as Doc. No. 143, Page No. 19, Book No.
V, Series of 1982.
On December 21, 1982, plaintiffs Grace Gosiengfiao, et al. filed a complaint for
"recovery of possession and legal redemption with damages" against defendants
Leonardo and Avelina Mariano. Plaintiffs alleged in their complaint that as co-
heirs and co-owners of the lot in question, they have the right to recover their
respective shares in the same, and property as they did not sell the same, and
the right of redemption with regard to the shares of other co-owners sold to the
defendants.
Defendants in their answer alleged that the plaintiffs has (sic) no cause of action
against them as the money used to redeem lot in question was solely from the
personal funds of third-party defendant Amparo Gosiengfiao-Ibarra, who
 consequently became the sole owner of the said property and thus validly sold
the entire property to the defendants, and the fact that defendants had already
sold the said property to the children, Lazaro Mariano and Dionicia M. Aquino.
Defendants further contend that even granting that the plaintiffs are co-owners
with the third-party defendants, their right of redemption had already been barred
by the Statute of Limitations under Article 1144 of the Civil Code, if not by
laches.4
After trial on the merits, the Regional Trial Court of Cagayan, Branch I, rendered a decision dated
September 16, 1986, dismissing the complaint and stating that respondents have no right of
ownership or possession over the lot in question. The trial court further said that when the subject
property foreclosed and sold at public auction, the rights of the heirs were reduced to a mere right
of redemption. And when Amparo G. Ibarra redeemed the lot from the Rural Bank on her own
behalf and with her own money she became the sole owner of the property. Respondents' having
failed to redeem the property from the bank or from Amparo G. Ibarra, lost whatever rights the
might have on the property.5
The Court of Appeals in its questioned decision reversed and set aside the ruling of the trial court
and declared herein respondents as co-owners of the property in the question. The Court of
Appeals said:
The whole controversy in the case at bar revolves on the question of "whether or
not a co-owner who redeems the whole property with her own personal funds
becomes the sole owner of said property and terminates the existing state of co-
ownership."
Admittedly, as the property in question was mortgaged by the decedent, a co-
ownership existed among the heirs during the period given by law to redeem the
foreclosed property. Redemption of the whole property by a co-owner does not
vest in him sole ownership over said property but will inure to the benefit of all co-
owners. In other words, it will not end to the existing state of co-ownership.
Redemption is not a mode of terminating a co-ownership.
xxx xxx xxx
In the case at bar, it is undisputed and supported by records, that third-party
defendant Amparo G. Ibarra redeemed the propety in dispute within the one year
redemption period. Her redemption of the property, even granting that the money
used was from her own personal funds did not make her the exclusive owner of
the mortgaged property owned in common but inured to the benefit of all co-
owners. It would have been otherwise if third-party defendant Amparo G. Ibarra
purchased the said property from the mortgagee bank (highest, bidder in the
foreclosure sale) after the redemption period had already expired and after the
mortgagee bank had consolidated it title in which case there would no longer be
any co-ownership to speak of .6
The decision of the Court of Appeals is supported by a long line of case law which states that a
redemption by a co-owner within the period prescribed by law inures to the benefit of all the other
co-owners.7
The main argument of petitioners in the case at bar is that the Court of Appeals incorrectly applied
Article 1620 of the Civil Code, instead of Article 1088 of the same code which governs legal
redemption by co-heirs since the lot in question, which forms part of the intestate estate of the late
Francisco Gosiengfiao, was never the subject of partition or distribution among the heirs, thus,
private respondents and third-party defendants had not ceased to be co-heirs.
On that premise, petitioners further contend that the right of legal redemption was not timely
exercised by the private respondents, since Article 1088 prescribes that the same must be done
within the period of one month from the time they were notified in writing of the sale by the vendor.
According to Tolentino, the fine distinction between Article 1088 and Article 1620 is that when the
sale consists of an interest in some particular property or properties of the inheritance, the right
redemption that arises in favor of the other co-heirs is that recognized in Article 1620. On the other
hand, if the sale is the hereditary right itself, fully or in part, in the abstract sense, without
specifying any particular object, the right recognized in Article 1088 exists.8
Petitioners allege that upon the facts and circumstances of the present case, respondents failed to
exercise their right of legal redemption during the period provided by law, citing as authority the
case of Conejero, et al., v. Court of Appeals, et al.9 wherein the Court adopted the principle that
the giving of a copy of a deed is equivalent to the notice as required by law in legal redemption.
We do not dispute the principle laid down in the Conejero case. However, the facts in the said
case are not four square with the facts of the present case. In Conejero, redemptioner Enrique
Conejero was shown and given a copy of the deed of sale of the subject property. The Court in
that case stated that the furnishing of a copy of the deed was equivalent to the giving of a written
notice required by law. 11
The records of the present petition, however, show no written notice of the sale being given
whatsoever to private respondents. Although, petitioners allege that sometime on October 31,
1982 private respondent, Grace Gosiengfiao was given a copy of the questioned deed of sale and
shown a copy of the document at the Office of the Barangay Captain sometime November 18,
1982, this was not supported by the evidence presented. On the contrary, respondent, Grace
Gosiengfiao, in her testimony, declared as follows:
Q. When you went back to the residence of Atty. Pedro Laggui
were you able to see him?
A. Yes, I did.
Q. When you saw him, what did you tell?
 A. I asked him about the Deed of Sale which Mrs. Aquino had
told me and he also showed me a Deed of Sale. I went over the
Deed of Sale and I asked Atty. Laggui about this and he
mentioned here about the names of the legal heirs. I asked why
my name is not included and I was never informed in writing
because I would like to claim and he told me to better consult
my own attorney.
Q. And did you go?
A. Yes, I did.
Q. What kind of copy or document is that?
A. It is a deed of sale signed by my mother, sister Amparo and
my brothers.
Q. If shown to you the copy of the Deed of Sale will you be able
to identify it?
A. Yes, sir.11
Thereafter, Grace Gosiengfiao explicitly stated that she was never given a copy of the said Deed
of Sale.
Q. Where did Don Mariano, Dr. Mariano and you see each other?
A. In the house of Brgy. Captain Antonio Bassig.
Q. What transpired in the house of the Brgy. Captain when you
saw each other there?
A. Brgy. Captain Bassig informed my intention of claiming the
lot and I also informed him about the Deed of Sale that was not
signed by me since it is mine it is already sold and I was
informed in writing about it. I am a legal heir and I have also the
right to claim.
Q. And what was the reply of Don Mariano and Dr. Mariano to
the information given to them by Brgy. Captain Bassig regarding
your claim?
A. He insisted that the lot is already his because of the Deed of
Sale. I asked for the exact copy so that I could show to him that
I did not sign and he said he does not have a copy. 12
The above testimony was never refuted by Dr. Mariano who was present before Brgy. Captain
Bassig.
The requirement of a written notice has long been settled as early as in the case of Castillo
v. Samonte,13 where this Court quoted the ruling in Hernaez v. Hernaez, 32 Phil., 214, thus:
Both the letter and spirit of the New Civil Code argue against any attempt to
widen the scope of the notice specified in Article 1088 by including therein any
other kind of notice, such as verbal or by registration. If the intention of the law
had been to include verbal notice or any other means of information as sufficient
to give the effect of this notice, then there would have been no necessity or
reasons to specify in Article 1088 of the New Civil Code that the said notice be
made in writing for, under the old law, a verbal notice or information was
sufficient. 14
Moreover, petitioners themselves adopted in their argument respondents' allegation In their
complaint that sometime on October, 1982 they sought the redemption of the property from
spouses Leonardo Mariano and Avelina Tigue, by tendering the repurchase money of P12,000.00,
which the spouses rejected.15 Consequently, private respondents exercised their right of
redemption at the first opportunity they have by tendering the repurchase price to petitioners. The
complaint they filed, before the Barangay Captain and then to the Regional Trial Court was
necessary to assert their rights. As we learned in the case of Castillo, supra:
It would seem clear from the above that the reimbursement to the purchaser
within the period of one month from the notice in writing is a requisite or condition
precedent to the exercise of the right of legal redemption; the bringing of an
action in court is the remedy to enforce that right in case the purchaser refuses
the redemption. The first must be done within the month-period; the second
within the prescriptive period provided in the Statute of Limitation. 16
The ruling in Castillo v. Samonte; supra, was reiterated in the case of Garcia v. Calaliman, where
We also discussed the reason for the requirement of the written notice. We said:
Consistent with aforesaid ruling, in the interpretation of a related provision (Article
1623 of the New Civil Code) this Court had stressed that written notice is
indispensable, actual knowledge of the sale acquired in some other manners by
the redemptioner, notwithstanding. He or she is still entitled to written notice, as
exacted by the code to remove all uncertainty as to the sale, its terms and its
validity, and to quiet and doubt that the alienation is not definitive. The law not
having provided for any alternative, the method of notifications remains exclusive,
though the Code does not prescribe any particular form of written notice nor any
distinctive method written notification of redemption (Conejero et al. v. Court of
Appeals et al., 16 SCRA 775 [1966]; Etcuban v. Court of Appeals, 148 SCRA 507
[1987]; Cabrera v. Villanueva, G.R. No. 75069, April 15, 1988).17 (Emphasis ours)
We likewise do not find merit in petitioners' position that private respondents could not have validly
effected redemption due to their failure to consign in court the full redemption price after tender
thereof was rejected by the petitioners. Consignation is not necessary, because the tender of
payment was not made to discharge an obligation, but to enforce or exercise a right. It has been
previously held that consignation is not required to preserve the right of repurchase as a mere
tender of payment is enough on time as a basis for an action to compel the vendee a retroto resell
the property; no subsequent consignation was necessary to entitle private respondents to such
reconveyance. 18

Premises considered, respondents have not lost their right to redeem, for in the absence of a
written notification of the sale by the vendors, the 30-day period has not even begun to run.

WHEREFORE, the decision of the Court of Appeals is hereby AFFIRMED. Cost against
petitioners.

SO ORDERED.

Narvasa, C.J., Padilla and Nocon, JJ., concur.

 Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-24419 July 15, 1968
LEONORA ESTOQUE, plaintiff-appellant,
vs.
ELENA M. PAJIMULA, assisted by her husband CIRIACO PAJIMULA, defendants-appellees.
REYES, J.B.L., J.:
Direct appeal from an order of the Court of First Instance of La Union, in its Civil Case No. 1990,
granting a motion to dismiss the complaint for legal redemption by a co-owner (retracto legal de
comuneros) on account of failure to state a cause of action.
The basic facts and issues are stated in the decision appealed from, as follows:
Plaintiff based her complaint for legal redemption on a claim that she is a co-owner of Lot
No. 802, for having purchased 1/3 portion thereof, containing an area of 640 square
meters as evidenced by a deed of sale, Annex "A", which was executed on October 28,
1951 by Crispina Perez de Aquitania, one of the co-owners, in her favor.
On the other hand, the defendant, who on December 30, 1959 acquired the other 2/3
portion of Lot No. 802 from Crispina Aquitania and her children, claimed that the plaintiff
bought the 1/3 southeastern portion, which is definitely identified and segregated, hence
there existed no co-ownership at the time and after said plaintiff bought the aforesaid
portion, upon which right of legal redemption can be exercised or taken advantage of.
From the complaint, it would appear that Lot No. 802 of the Cadastral survey of Rosario,
covered by original certificate of title No. RO-2720 (N.A.) was originally owned by the late
spouses, Rosendo Perez and Fortunata Bernal, who were survived by her children,
namely, Crispina Perez, Lorenzo Perez and Ricardo Perez. Ricardo Perez is also now
dead. On October 28, 1951, Crispina P. Vda. de Aquitania sold her right and participation
in Lot No. 802 consisting of 1/3 portion with an area of 640 square meters to Leonora
Estoque (Annex A of the complaint). On October 29, 1951, Lorenzo Perez, Crispina Perez
and Emilia P. Posadas, widow of her deceased husband, Ricardo Perez for herself and in
behalf of her minor children, Gumersindo, Raquel, Emilio and Ricardo, Jr., executed a
deed of extrajudicial settlement wherein Lorenzo Perez, Emilia P. Posadas and her minor
children assigned all their right, interest and participation in Lot No. 802 to Crispina Perez
(Annex B of the complaint). On December 30, 1959, Crispina Perez and her children
Rosita Aquitania Belmonte, Remedios Aquitania Misa, Manuel Aquitania, Sergio
Aquitania and Aurora Aquitania sold to Elena Pajimula, the remaining 2/3 western portion
of Lot No. 802 with an area of 958 square meters (Annex C of the complaint).
The action of the plaintiff is premised on the claim of co-ownership. From the deed of sale
executed in favor of the plaintiff, it can be seen that the 1/3 portion sold to plaintiff is
definitely identified as the 1/3 portion located on the southeastern part of Lot No. 802 and
specifically bounded on the north by De Guzman Street, on the east by Posadas Street,
on the south by Perez Street, and on the west by remaining portion of the same lot, which
contained an area of 640 square meters. And in the deed of sale executed by Crispina
Perez and her children in favor of defendant Elena Pajimula over the remaining 2/3
portion of Lot No. 802, said portion is identified as the western portion of Lot No. 802
which is bounded on the north by De Guzman Street, on the east by properties of
Leonarda Estoque, on the south by the national road and on the west by Lots Nos. 799
and 801, containing an area of 598 square meters.
The appellant's stand is that the deed in her favor was inoperative to convey the southeastern third
of Lot 802 of the Rosario Cadastre notwithstanding the description in the deed itself, for the reason
that the vendor, being a mere co-owner, had no right to sell any definite portion of the land held in
common but could only transmit her undivided share, since the specific portion corresponding to
the selling co-owner is not known until partition takes place (Lopez vs. Ilustre, 5 Phil. 567; Ramirez
vs. Bautista, 14 Phil. 528). From this premise, the appellant argues that the sale in her favor,
although describing a definite area, should be construed as having conveyed only the undivided
1/3 interest in Lot 802 owned at the time by the vendor, Crispina Perez Vda. de Aquitania.
Wherefore, when the next day said vendor acquired the 2/3 interest of her two other co-owners,
Lot 802 became the common property of appellant and Crispina Perez. Therefore, appellant
argues, when Crispina sold the rest of the property to appellee Pajimula spouses, the former was
selling an undivided 2/3 that appellant, as co-owner, was entitled to redeem, pursuant to Article
1620 of the New Civil Code.
ART. 1620. A co-owner of a thing may exercise the right of redemption in case the shares
of all the other co-owners or of any of them, are sold to a third person. If the price of the
alienation is grossly excessive the redemptioner shall pay only a reasonable one.
Should two or more co-owners desire to exercise the right of redemption, they may only
do so in proportion to the share they may respectively have in the thing owned in common.
The lower court, upon motion of defendant, dismissed the complaint, holding that the deeds of
sale show that the lot acquired by plaintiff Estoque was different from that of the defendants
Pajimula; hence they never became co-owners, and the alleged right of legal redemption was not
proper. Estoque appealed.
We find no error in the order of dismissal, for the facts pleaded negate the claim that appellant
Estoque ever became a co-owner of appellees Pajimula.
(1) The deed of sale to Estoque (Annex A of the complaint) clearly specifies the object sold as the
southeastern third portion of Lot 802 of the Rosario Cadastre, with an area of 840 square meters,
more or less. Granting that the seller, Crispina Perez Vda. de Aquitania could not have sold this
particular portion of the lot owned in common by her and her two brothers, Lorenzo and Ricardo
Perez, by no means does it follow that she intended to sell to appellant Estoque her 1/3 undivided
interest in the lot forementioned. There is nothing in the deed of sale to justify such inference. That
the seller could have validly sold her one-third undivided interest to appellant is no proof that she
did choose to sell the same. Ab posse ad actu non valet illatio.

(2) While on the date of the sale to Estoque (Annex A) said contract may have been ineffective, for
lack of power in the vendor to sell the specific portion described in the deed, the transaction was
validated and became fully effective when the next day (October 29, 1951) the vendor, Crispina
Perez, acquired the entire interest of her remaining co-owners (Annex B) and thereby became the
sole owner of Lot No. 802 of the Rosario Cadastral survey (Llacer vs. Muñoz, 12 Phil. 328). Article
1434 of the Civil Code of the Philippines clearly prescribes that — .

When a person who is not the owner of a thing sells or alienates and delivers it, and later
the seller or grantor acquires title thereto, such title passes by operation of law to the
buyer or grantee."

Pursuant to this rule, appellant Estoque became the actual owner of the southeastern third of lot
802 on October 29, 1951. Wherefore, she never acquired an undivided interest in lot 802. And
when eight years later Crispina Perez sold to the appellees Pajimula the western two-thirds of the
same lot, appellant did not acquire a right to redeem the property thus sold, since their respective
portions were distinct and separate.

IN VIEW OF THE FOREGOING, the appealed order of dismissal is affirmed. Costs against
appellant Estoque.1äwphï1.ñët

Concepcion, C.J., Dizon, Makalintal, Zaldivar, Sanchez, Castro, Angeles and Fernando, JJ.,
concur.
 Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 75884 September 24, 1987
JULITA GO ONG, FOR HERSELF AND AS JUDICIAL GUARDIAN OF STEVEN GO
ONG, petitioners,
vs.
THE HON. COURT OF APPEALS, ALLIED BANKING CORPORATION and the CITY SHERIFF
OF QUEZON CITY, respondents.
PARAS, J.:
This is a petition for review on certiorari of the March 21, 1986 Decision * of the Court of Appeals
in AC-G.R. CV No. 02635, "Julita Ong etc. vs. Allied Banking Corp. et al." affirming, with
modification, the January 5, 1984 Decision of the Regional Trial Court of Quezon City in Civil Case
No. Q-35230.
The uncontroverted facts of this case, as found by the Court of Appeals, are as follows:
...: Two (2) parcels of land in Quezon City Identified as Lot No. 12, Block 407,
Psd 37326 with an area of 1960.6 sq. m. and Lot No. 1, Psd 15021, with an area
of 3,660.8 sq. m. are covered by Transfer Certificate of Title No. 188705 in the
name of "Alfredo Ong Bio Hong married to Julita Go Ong "(Exh. D). Alfredo Ong
Bio Hong died on January 18, 1975 and Julita Go Ong was appointed
administratrix of her husband's estate in Civil Case No. 107089. The letters of
administration was registered on TCT No. 188705 on October 23, 1979.
Thereafter, Julita Go Ong sold Lot No. 12 to Lim Che Boon, and TCT No. 188705
was partially cancelled and TCT No. 262852 was issued in favor of Lim Che
Boon covering Lot No. 12 (Exh. D-4). On June 8, 1981 Julita Go Ong through her
attorney-in-fact Jovita K. Yeo (Exh. 1) mortgaged Lot No. 1 to the Allied Banking
Corporation to secure a loan of P900,000.00 obtained by JK Exports, Inc. The
mortgage was registered on TCT No. 188705 on the same date with the following
notation: "... mortgagee's consent necessary in case of subsequent alienation or
encumbrance of the property other conditions set forth in Doc. No. 340, Page No.
69, Book No. XIX, of the Not. Public of Felixberto Abad". On the loan there was
due the sum of P828,000.00 and Allied Banking Corporation tried to collect it
from Julita Go Ong, (Exh. E). Hence, the complaint alleging nullity of the contract
for lack of judicial approval which the bank had allegedly promised to secure from
the court. In response thereto, the bank averred that it was plaintiff Julita Go Ong
who promised to secure the court's approval, adding that Julita Go Ong informed
the defendant that she was processed the sum of P300,000.00 by the JK Exports,
Inc. which will also take charge of the interest of the loan.
Concluding, the trial court ruled:
Absent (of) any evidence that the property in question is the
capital of the deceased husband brought into the marriage, said
property should be presumed as acquired during the marriage
and, therefore, conjugal property,
After the dissolution of the marriage with the death of plaintiff's
husband, the plaintiff acquired, by law, her conjugal share,
together with the hereditary rights thereon. (Margate vs.
Rabacal, L-14302, April 30, 1963). Consequently, the mortgage
constituted on said property, upon express authority of plaintiff,
notwithstanding the lack of judicial approval, is valid, with
respect to her conjugal share thereon, together with her
hereditary rights.
On appeal by petitioner, respondent Court of Appeals affirmed, with modification, the appealed
decision (Record, pp. 19-22). The dispositive portion of the appellate court's decision reads:
WHEREFORE, with the modification that the extrajudicial foreclosure
proceedings instituted by defendant against plaintiff shall be held in abeyance to
await the final result of Civil Case No. 107089 of the Court of First Instance of
Manila, 6th Judicial District Branch XXXII, entitled "IN THE MATTER OF THE
INTESTATE ESTATE OF THE LATE ALFREDO ONG BIO: JULITA GO ONG,
ADMINISTRATRIX". In pursuance with which the restraining order of the lower
court in this case restraining the sale of the properties levied upon is hereby
ordered to continue in full force and effect coterminous with the final result of Civil
Case No. 107089, the decision appealed from is hereby affirmed. Costs against
plaintiff-appellant.
SO ORDERED.
On April 8, 1986, petitioner moved for the reconsideration of the said decision (Ibid., pp. 24-29),
but in a Resolution dated September 11, 1986, respondent court denied the motion for lack of
merit (Ibid., p. 23). Hence, the instant petition (Ibid., pp. 6-17).
The Second Division of this Court, in a Resolution dated November 19, 1986 (Rollo, p. 30), without
giving due course to the petition, resolved to require private respondent to comment thereon and it
did on February 19, 1987 (Ibid., pp. 37-42). Thereafter, in a Resolution dated April 6, 1987, the
petition was given due course and the parties were required to file their respective memoranda
(Ibid., p. 43).
Petitioner filed her Memorandum on May 13, 1987 (Ibid., pp. 45-56), while private respondent filed
its Memorandum on May 20, 1987 (Ibid., pp. 62-68).
The sole issue in this case is —
WHETHER OR NOT THE MORTGAGE CONSTITUTED OVER THE PARCEL OF LAND UNDER
PETITIONER'S ADMINISTRATION IS NULL AND VOID FOR WANT OF JUDICIAL APPROVAL.
The instant petition is devoid of merit.
The well-settled rule that the findings of fact of the trial court are entitled to great respect, carries
even more weight when affirmed by the Court of Appeals as in the case at bar.
In brief, the lower court found: (1) that the property under the administration of petitioner — the
wife of the deceased, is a community property and not the separate property of the latter; (2) that
the mortgage was constituted in the wife's personal capacity and not in her capacity as
administratrix; and (3) that the mortgage affects the wife's share in the community property and
her inheritance in the estate of her husband.
Petitioner, asserting that the mortgage is void for want of judicial approval, quoted Section 7 of
Rule 89 of the Rules of Court and cited several cases wherein this Court ruled that the regulations
provided in the said section are mandatory.
While petitioner's assertion may have merit insofar as the rest of the estate of her husband is
concerned the same is not true as regards her conjugal share and her hereditary rights in the
estate. The records show that petitioner willingly and voluntarily mortgaged the property in
question because she was processed by JK Exports, Inc. the sum of P300,000.00 from the
proceeds of the loan; and that at the time she executed the real estate mortgage, there was no
court order authorizing the mortgage, so she took it upon herself, to secure an order.
Thus, in confirming the findings of the lower court, as supported by law and the evidence, the
Court of Appeals aptly ruled that Section 7 of Rule 89 of the Rules of Court is not applicable, since
the mortgage was constituted in her personal capacity and not in her capacity as administratrix of
the estate of her husband.
Nevertheless, petitioner, citing the cases of Picardal, et al. vs. Lladas (21 SCRA 1483)
and Fernandez, et al. vs. Maravilla (10 SCRA 589), further argues that in the settlement
proceedings of the estate of the deceased spouse, the entire conjugal partnership property of the
marriage is under administration. While such may be in a sense true, that fact alone is not
sufficient to invalidate the whole mortgage, willingly and voluntarily entered into by the petitioner.
An opposite view would result in an injustice. Under similar circumstances, this Court applied the
provisions of Article 493 of the Civil Code, where the heirs as co-owners shall each have the full
ownership of his part and the fruits and benefits pertaining thereto, and he may therefore alienate,
assign or mortgage it, and even effect of the alienation or mortgage, with respect to the co-owners,
shall be limited to the portion which may be allotted to him in the division upon the termination of
the co-ownership (Philippine National Bank vs. Court of Appeals, 98 SCRA 207 [1980]).
Consequently, in the case at bar, the trial court and the Court of Appeals cannot be faulted in
ruling that the questioned mortgage constituted on the property under administration, by authority
of the petitioner, is valid, notwithstanding the lack of judicial approval, with respect to her conjugal
share and to her hereditary rights. The fact that what had been mortgaged was in custodia legis is
immaterial, insofar as her conjugal share and hereditary share in the property is concerned for
after all, she was the ABSOLUTE OWNER thereof. This ownership by hers is not disputed, nor is
there any claim that the rights of the government (with reference to taxes) nor the rights of any heir
or anybody else have been prejudiced for impaired. As stated by Associate Justice (later Chief
Justice) Manuel Moran in Jakosalem vs. Rafols, et al., 73 Phil. 618 —
The land in question, described in the appealed decision, originally belonged to
Juan Melgar. The latter died and the judicial administration of his estate was
commenced in 1915 and came to a close on December 2, 1924, only. During the
pendency of the said administration, that is, on July 5, 1917, Susana Melgar,
daughter of the deceased Juan Melgar, sold the land with the right of repurchase
to Pedro Cui, subject to the stipulation that during the period for the repurchase
she would continue in possession of the land as lessee of the purchase. On
December 12, 1920, the partition of the estate left by the deceased Juan Melgar
was made, and the land in question was adjudicated to Susana Melgar. In 1921,
she conveyed, in payment of professional fees, one-half of the land in favor of the
defendant-appellee Nicolas Rafols, who entered upon the portion thus conveyed
and has been in possession thereof up to the present. On July 23, 1921, Pedro
Cui brought an action to recover said half of the land from Nicolas Rafols and the
other half from the other defendants, and while that case was pending, or about
August 4, 1925, Pedro Cui donated the whole land in question to Generosa
Teves, the herein plaintiff-appellant, after trial, the lower court rendered a
decision absolving Nicolas Rafols as to the one-half of the land conveyed to him
by Susana Melgar, and declaring the plaintiff owner of the other half by express
acknowledgment of the other defendants. The plaintiff appealed from that part of
the judgment which is favorable to Nicolas Rafols.
The lower court absolved Nicolas Rafols upon the theory that Susana Melgar
could not have sold anything to Pedro Cui because the land was then in custodia
legis, that is, under judicial administration. This is error. That the land could not
ordinary be levied upon while in custodia legis, does not mean that one of the
heirs may not sell the right, interest or participation which he has or might have in
the lands under administration. The ordinary execution of property in custodia
legis is prohibited in order to avoid interference with the possession by the court.
But the sale made by an heir of his share in an inheritance, subject to the result
of the pending administration, in no wise stands in the way of such administration.
The reference to judicial approval in Sec. 7, Rule 89 of the Rules of Court cannot adversely affect
the substantiverights of private respondent to dispose of her Ideal [not inchoate, for the conjugal
partnership ended with her husband's death, and her hereditary rights accrued from the moment of
the death of the decedent (Art. 777, Civil Code) share in the co-heirship and/or co-ownership
formed between her and the other heirs/co-owners (See Art. 493, Civil Code, supra.). Sec. 7, Art.
89 of the Civil Code applies in a case where judicial approval has to be sought in connection with,
for instance, the sale or mortgage of property under administration for the payment, say of a
conjugal debt, and even here, the conjugal and hereditary shares of the wife are excluded from the
requisite judicial approval for the reason already adverted to hereinabove, provided of course no
prejudice is caused others, including the government.
Moreover, petitioner is already estopped from questioning the mortgage. An estoppel may arise
from the making of a promise even though without consideration, if it was intended that the
promise should be relied upon and in fact it was relied upon, and if a refusal to enforce it would be
virtually to sanction the perpetration of fraud or would result in other injustice (Gonzalo Sy Trading
vs. Central Bank, 70 SCRA 570).

PREMISES CONSIDERED, the instant petition is hereby DENIED and the assailed decision of the
Court of Appeals is hereby AFFIRMED.

SO ORDERED.

Yap (Chairman), Melencio-Herrera, Padilla and Sarmiento, JJ., concur.

 Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 102380 January 18, 1993
HERODOTUS P. ACEBEDO and DEMOSTHENES P. ACEBEDO, petitioners,
vs.
HON. BERNARDO P. ABESAMIS, MIGUEL ACEBEDO, ALEXANDER ACEBEDO, NAPOLEON
ACEBEDO, RIZALINO ACEBEDO, REPUBLICA ACEBEDO, FILIPINAS ACEBEDO and YU
HWA PING, respondents.
CAMPOS, JR., J.:
The lower court's jurisdiction in approving a Deed of Conditional Sale executed by respondents-
heirs and ordering herein administrator-petitioner Herodotus Acebedo to sell the remaining
portions of said properties, despite the absence of its prior approval as a probate court, is being
challenged in the case at bar.
The late Felix Acebedo left an estate consisting of several real estate properties located in Quezon
City and Caloocan City, with a conservative estimated value of about P30 million. Said estate
allegedly has only the following unsettled claims:
a. P87,937.00 representing unpaid real estate taxes due Quezon City;
b. P20,244.00 as unpaid real estate taxes due Caloocan City;
c. The unpaid salaries/allowances of former Administrator Miguel Acebedo, and
the incumbent Administrator Herodotus Acebedo; and
d. Inheritance taxes that may be due on the net estate.
The decedent was succeeded by eight heirs, two of whom are the petitioners herein, and the
others are the private respondents.
Due to the prolonged pendency of the case before the respondent Court for sixteen years,
respondents-heirs filed a "Motion for Approval of Sale", on October 4, 1989. The said sale involved
the properties covered by Transfer Certificate of Title Nos. 155569, 120145, 9145, and 18709, all
of which are registered in Quezon City, and form part of the estate. The consideration for said lots
was twelve (12) million pesos and by that time, they already had a buyer. It was further stated in
said Motion that respondents-heirs have already received their proportionate share of the six (6)
million pesos paid by the buyer, Yu Hwa Ping, as earnest money; that the balance of
P6,000,000.00 is more than enough to pay the unsettled claims against the estate. Thus, they
prayed for the Court to direct the administrator, Herodotus Acebedo (referred to as petitioner-
administrator hereafter):
1. to sell the properties mentioned in the motion;
2. with the balance of P6 million, to pay all the claims against the Estate; and
3. to distribute the residue among the Heirs in final settlement of the Estate.
To the aforesaid Motion, herein petitioner-administrator interposed an "Opposition to Approval of
Sale", to wit:
1. That he has learned that some of the heirs herein have sold some real estate
property of the Estate located at Balintawak, Quezon City, without the knowledge
of the herein administrator, without the approval of this Honorable Court and of
some heirs, and at a shockingly low price;
2. That he is accordingly hereby registering his vehement objection to the
approval of the sale, perpetrated in a manner which can even render the
proponents of the sale liable for punishment for contempt of this Honorable Court;
3. The herein Administrator instead herein prays this Honorable Court to
authorize the sale of the above mentioned property of the Estate to generate
funds to pay certain liabilities of the Estate and with the approval of this
Honorable Court if warranted, to give the heirs some advances chargeable
against theirs (sic) respective shares, and, for the purpose to authorize the herein
Administrator, and the other heirs to help the Administrator personally or through
a broker, to look for a buyer for the highest obtainable price, subject always to the
approval of this Honorable Court.1
On October 30, 1989, herein petitioners moved to be given a period of forty-five (45) days within
which to look for a buyer who will be willing to buy the properties at a price higher than
P12,000,000.00.
The case was set for hearing on December 15, 1989. However, by said date, petitioners have not
found any buyer offering better terms. Thus, they asked the Court, on February 8, 1990, for an in
extendible period of thirty days to look for a buyer.
Petitioner-administrator then filed a criminal complaint for falsification of a public document against
Yu Hwa Ping and notary public Eugenio Obon on February 26, 1990. He initiated this complaint
upon learning that it was Yu Hwa Ping who caused the notarization of the Deed of Conditional
Sale wherein allegedly petitioner-administrator's signature was made to appear. He also learned
that after he confronted the notary public of the questioned document, the latter revoked his
notarial act on the same.
On April 2, 1990, petitioner-administrator filed the civil action to secure the declaration by the
Court of the nullity of the Deed of Conditional Sale and the Deed of Absolute Sale.
The period granted herein petitioners having lapsed without having found a buyer, petitioner
Demosthenes Acebedo sought to nullify the Orders granting them several periods within which to
look for a better buyer. Respondents filed a comment thereon.
Having miserably failed to find a better buyer, after seven long months, petitioner-administrator
filed another "Opposition to Approval of Sale", dated May 10, 1990, maintaining that the sale
should wait for the country to recover from the effects of the coup d'etat attempts, otherwise, the
properties should be divided among the heirs.
On June 21, 1990, petitioners filed a "Motion for Leave of Court to Mortgage and Lease some of
the Properties of the Estate". To this Motion, respondents filed an Opposition on the following
grounds : that the motion is not proper because of the pending motion to approve the sale of the
same properties; that said conditional sale was initiated by petitioner-administrator who had earlier
signed a receipt for P500,000.00 as earnest money; that the approval of the sale would mean Yu
Hwa Ping's assumption of payment of the realty taxes; that the estate has no further debts and
thus, the intestate administrator may be terminated.
On August 17, 1990, respondent Court issued an Order, the dispositive portion of which, stated,
among others, to wit:2
b. the motion filed by the heirs-movants, dated October 4, 1989, praying that the
new administrator be directed to sell the properties covered by TCT Nos. 155569,
120145, 9145 and 18709, in favor of Yu Hwa Ping is hereby denied; and
c. the new administrator is hereby granted leave to mortgage some properties of
the estate at a just and reasonable amount, subject to the approval of the Court.
On December 4, 1990, the respondent Judge issued an order resolving to call the parties to a
conference on December 17, 1990. The conference was held, but still the parties were unable to
arrive at an agreement. So, on January 4, 1991, it was continued, wherein the parties actually
agreed that the heirs be allowed to sell their shares of the properties to Yu Hwa Ping for the price
already agreed upon, while herein petitioners negotiate for a higher price with Yu Hwa Ping.
Petitioners, then, instead filed a "Supplemental Opposition" to the approval of the Deed of
Conditional Sale.
On March 29, 1991, the respondent Court issued the challenged Order, the dispositive portion of
which states, to wit:
WHEREFORE, the Order dated August 7, 1990, is hereby lifted, reconsidered
and set aside, and another one is hereby issued as follows:
1. Approving the conditional sale, dated September 10, 1989, executed by the
heirs-movants, in favor of Yu Hwa Ping, pertaining to their respective shares in
the properties covered by TCT Nos. 155569, 120145, 1945 and 18709 of the
Register of Deeds of Quezon City;
2. Ordering the administrator Herodotus Acebedo to sell the remaining portions of
the said properties also in favor of Yu Hwa Ping at the same price as the sale
executed by the herein heirs-movants;
3. Ordering Yu Hwa Ping to deposit with the Court the total remaining balance of
the purchase price for the said lots within TWENTY (20) DAYS from notice hereof;
4. The motion to cite former administrator Miguel Acebedo in contempt of court,
resulting from his failure to submit the owner's copy of TCT Nos. 155569, and
120145 is hereby denied.3
Yu Hwa Ping, on April 4, 1991, deposited the remaining balance of the purchase price for the
properties subject of the Deed of Conditional Sale in the amount of P6,500,000.00.
Petitioners herein received the questioned Order on April 11, 1991. Twenty one (21) days
thereafter, they filed a Motion for Reconsideration, praying that the Court reinstate its Order of
August 17, 1990. To this, private respondents filed their Opposition.4
Instead of making a reply, petitioners herein filed a Supplemental Motion for Reconsideration. The
motions for reconsideration of herein petitioners were denied by the respondent Court on August
23, 1991.
On September 23, 1991, herein petitioners filed a Motion for Partial Reconsideration, hoping for
the last time that they would be able to convince the Court that its Order dated March 29, 1991 in
effect approving the conditional sale is erroneous and beyond its jurisdiction.
On October 17, 1991, the respondent Court denied the Motion for Partial Reconsideration for "lack
of merit".
On November 7, 1991, private respondents filed a Motion for Execution of the Order dated March
29, 1991. This was pending resolution when the petitioners filed this Petition for Certiorari.
The controversy in the case at bar revolves around one question: Is it within the jurisdiction of the
lower court, acting as a probate court, to issue an Order approving the Deed of Conditional Sale
executed by respondents-heirs without prior court approval and to order herein Administrator to
sell the remaining portion of said properties?
We answer in the positive?
In the case of Dillena vs. Court of Appeals,5 this Court made a pronouncement that it is within the
jurisdiction of the probate court to approve the sale of properties of a deceased person by his
prospective heirs before final adjudication. Hence, it is error to say that this matter should be
threshed out in a separate action.
The Court further elaborated that although the Rules of Court do not specifically state that the sale
of an immovable property belonging to an estate of a decedent, in a special proceeding, should be
made with the approval of the court, this authority is necessarily included in its capacity as a
probate court. Therefore, it is clear that the probate court in the case at bar, acted within its
jurisdiction in issuing the Order approving the Deed of Conditional Sale.
Private respondents having secured the approval of the probate court, a matter which is
unquestionably within its jurisdiction, and having established private respondents' right to alienate
the decedent's property subject of administration, this Petition should be dismissed for lack of
merit.
PREMISES considered, Petition is hereby DISMISSED. With Costs.
SO ORDERED.

We cannot countenance the position maintained by herein petitioners that said conditional sale is Narvasa, C.J., Feliciano, Regalado and Nocon, JJ., concur.
null and void for lack of prior court approval. The sale precisely was made conditional, the
condition being that the same should first be approved by the probate court.

Petitioners herein anchor their claim on Section 7, Rule 89 of the Rules of Court. 6 It is settled that
court approval is necessary for the validity of any disposition of the decedent's estate. However,
reference to judicial approval cannot adversely affect the substantive rights of the heirs to dispose
of their ideal share in the co-heirship and/or co-ownership among the heirs.7

This Court had the occasion to rule that there is no doubt that an heir can sell whatever right,
interest, or participation he may have in the property under administration. This is a matter which
comes under the jurisdiction of the probate court.8

The right of an heir to dispose of the decedent's property, even if the same is under administration,
is based on the Civil Code provision9 stating that the possession of hereditary property is deemed
transmitted to the heir without interruption and from the moment of the death of the decedent, in
case the inheritance is accepted. Where there are however, two or more heirs, the whole estate of
the decedent is, before its partition, owned in common by such heirs. 10

The Civil Code, under the provisions on co-ownership, further qualifies this right.11 Although it is
mandated that each co-owner shall have the full ownership of his part and of the fruits and
benefits pertaining thereto, and thus may alienate, assign or mortgage it, and even substitute
another person in its enjoyment, the effect of the alienation or the mortgage, with respect to the
co-owners, shall be limited to the portion which may be allotted to him in the division upon the
termination of the co-ownership.12 In other words, the law does not prohibit a co-owner from selling,
alienating or mortgaging his ideal share in the property held in common.13

As early as 1942, this Court has recognized said right of an heir to dispose of property under
administration. In the case of Teves de Jakosalem vs. Rafols, et al.,14 it was said that the sale
made by an heir of his share in an inheritance, subject to the result of the pending administration,
in no wise, stands in the way of such administration. The Court then relied on the provision of the
Old Civil Code, Article 440 and Article 339 which are still in force as Article 533 and Article 493,
respectively, in the new Civil Code. The Court also cited the words of a noted civilist, Manresa:
"Upon the death of a person, each of his heirs 'becomes the undivided owner of the whole estate
left with respect to the part or portion which might be adjudicated to him, a community of
ownership being thus formed among the co-owners of the estate which remains undivided'."
 Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 61584 November 25, 1992
DONATO S. PAULMITAN, JULIANA P. FANESA and RODOLFO FANESA, petitioners,
vs.
COURT OF APPEALS, ALICIO PAULMITAN, ELENA PAULMITAN, ABELINO PAULMITAN,
ANITA PAULMITAN, BAKING PAULMITAN, ADELINA PAULMITAN and ANITO
PAULMITAN, respondents.
ROMERO, J.:
This is a petition for review on certiorari seeking the reversal of the decision 1 of the Court of
Appeals, dated July 14, 1982 in CA-G.R. No. 62255-R entitled "Alicio Paulmitan, et al. v. Donato
Sagario Paulmitan, et al." which affirmed the decision 2 of the then Court of First Instance (now
RTC) of Negros Occidental, 12th Judicial District, Branch IV, Bacolod City, in Civil Case No. 11770.
The antecedent facts are as follows:
Agatona Sagario Paulmitan, who died sometime in 1953, 3 left the two following parcels of land
located in the Province of Negros Occidental: (1) Lot No. 757 with an area of 1,946 square meters
covered by Original Certificate of Title (OCT) No. RO-8376; and (2) Lot No. 1091 with an area of
69,080 square meters and covered by OCT No. RO-11653. From her marriage with Ciriaco
Paulmitan, who is also now deceased, Agatona begot two legitimate children, namely: Pascual
Paulmitan, who also died in 1953, 4 apparently shortly after his mother passed away, and Donato
Paulmitan, who is one of the petitioners. Petitioner Juliana P. Fanesa is Donato's daughter while
the third petitioner, Rodolfo Fanes, is Juliana's husband. Pascual Paulmitan, the other son of
Agatona Sagario, is survived by the respondents, who are his children, name: Alicio, Elena,
Abelino, Adelina, Anita, Baking and Anito, all surnamed Paulmitan.
Until 1963, the estate of Agatona Sagario Paulmitan remained unsettled and the titles to the two
lots mentioned above remained in the name of Agatona. However, on August 11, 1963, petitioner
Donato Paulmitan executed an Affidavit of Declaration of Heirship, extrajudicially adjudicating unto
himself Lot No. 757 based on the claim that he is the only surviving heir of Agatona Sagario. The
affidavit was filed with the Register of Deeds of Negros Occidental on August 20, 1963, cancelled
OCT No. RO-8376 in the name of Agatona Sagario and issued Transfer Certificate of Title (TCT)
No. 35979 in Donato's name.
As regards Lot No. 1091, Donato executed on May 28, 1974 a Deed of Sale over the same in
favor of petitioner Juliana P. Fanesa, his daughter. 5
In the meantime, sometime in 1952, for non-payment of taxes, Lot No. 1091 was forfeited and sold
at a public auction, with the Provincial Government of Negros Occidental being the buyer. A
Certificate of Sale over the land was executed by the Provincial Treasurer in favor of the Provincial
Board of Negros Occidental. 6
On May 29, 1974, Juliana P. Fanesa redeemed the property from the Provincial Government of
Negros Occidental for the amount of P2,959.09. 7
On learning of these transactions, respondents children of the late Pascual Paulmitan filed on
January 18, 1975 with the Court of First Instance of Negros Occidental a Complaint against
petitioners to partition the properties plus damages.
Petitioners set up the defense of prescription with respect to Lot No. 757 as an affirmative defense,
contending that the Complaint was filed more than eleven years after the issuance of a transfer
certificate of title to Donato Paulmitan over the land as consequence of the registration with the
Register of Deeds, of Donato's affidavit extrajudicially adjudicating unto himself Lot No. 757. As
regards Lot No. 1091, petitioner Juliana P. Fanesa claimed in her Answer to the Complaint that
she acquired exclusive ownership thereof not only by means of a deed of sale executed in her
favor by her father, petitioner Donato Paulmitan, but also by way of redemption from the Provincial
Government of Negros Occidental.
Acting on the petitioners' affirmative defense of prescription with respect to Lot No. 757, the trial
court issued an order dated April 22, 1976 dismissing the complaint as to the said property upon
finding merit in petitioners' affirmative defense. This order, which is not the object of the present
petition, has become final after respondents' failure to appeal therefrom.
Trial proceeded with respect to Lot No. 1091. In a decision dated May 20, 1977, the trial court
decided in favor of respondents as to Lot No. 1091. According to the trial court, the respondents,
as descendants of Agatona Sagario Paulmitan were entitled to one-half (1/2) of Lot No. 1091, pro
indiviso. The sale by petitioner Donato Paulmitan to his daughter, petitioner Juliana P. Fanesa, did
not prejudice their rights. And the repurchase by Juliana P. Fanesa of the land from the Provincial
Government of Negros Occidental did not vest in Juliana exclusive ownership over the entire land
but only gave her the right to be reimbursed for the amount paid to redeem the property. The trial
court ordered the partition of the land and directed petitioners Donato Paulmitan and Juliana P.
Fanesa to pay private respondents certain amounts representing the latter's share in the fruits of
the land. On the other hand, respondents were directed to pay P1,479.55 to Juliana P. Fanesa as
their share in the redemption price paid by Fanesa to the Provincial Government of Negros
Occidental. The dispositive portion of the trial court's decision reads:
WHEREFORE, judgment is hereby rendered on the second cause of action
pleaded in the complain as follows:
1. The deed of sale (Exh. "F") dated May 28, 1974 is valid insofar as the one-half
undivided portion of Lot 1091 is concerned as to vest ownership over said half
 portion in favor of defendant Juliana Fanesa and her husband Rodolfo Fanesa,
while the remaining half shall belong to plaintiffs, pro-indiviso;
2. Lot 1091, Cadastral Survey of Pontevedra, Province of Negros Occidental,
now covered by TCT No. RO-11653 (N.A.), is ordered partitioned. The parties
must proceed to an actual partition by property instrument of partition, submitting
the corresponding subdivision within sixty (60) days from finality of this decision,
and should they fail to agree, commissioners of partition may be appointed by the
Court;
3. Pending the physical partition, the Register of Deeds of Negros Occidental is
ordered to cancel Original Certificate of Title No. RO-11653 (N.A.) covering Lot
1091, Pontevedra Cadastre, and to issue in lieu thereof a new certificate of title in
the name of plaintiffs and defendants, one-half portion each,pro-indiviso, as
indicated in paragraph 1 above;
4. Plaintiffs are ordered to pay, jointly and severally, defendant Juliana Fanesa
the amount of P1,479.55 with interest at the legal rate from May 28, 1974 until
paid;
5 Defendants Donato Sagario Paulmitan and Juliana Paulmitan Fanesa are
ordered to account to plaintiffs and to pay them, jointly and severally, the value of
the produce from Lot 1091 representing plaintiffs' share in the amount of
P5,000.00 per year from 1966 up to the time of actual partition of the property,
and to pay them the sum of P2,000.00 as attorney's fees as well as the costs of
the suit.
xxx xxx xxx
On appeal, the Court of Appeals affirmed the trial court's decision. Hence this petition.
To determine the rights and obligations of the parties to the land in question, it is well to review,
initially, the relatives who survived the decedent Agatona Sagario Paulmitan. When Agatona died
in 1953, she was survived by two (2) sons, Donato and Pascual. A few months later in the same
year, Pascual died, leaving seven children, the private respondents. On the other had, Donato's
sole offspring was petitioner Juliana P. Fanesa.
At the time of the relevant transactions over the properties of decedent Agatona Sagario
Paulmitan, her son Pascual had died, survived by respondents, his children. It is, thus, tempting to
apply the principles pertaining to the right of representation as regards respondents. It must,
however, be borne in mind that Pascual did no predecease his mother, 8 thus precluding the
operation of the provisions in the Civil Code on the right of representation 9 with respect to his
children, the respondents. When Agatona Sagario Paulmitan died intestate in 1952, her two (2)
sons Donato and Pascual were still alive. Since it is well-settled by virtue of Article 777 of the Civil
Code that "[t]he rights to the succession are transmitted from the moment of the death of the
decedent," 10 the right of ownership, not only of Donato but also of Pascual, over their respective
shares in the inheritance was automatically and by operation of law vested in them in 1953 when
their mother died intestate. At that stage, the children of Donato and Pascual did not yet have any
right over the inheritance since "[i]n every inheritance, the relative nearest in degree excludes the
more distant
ones." 11 Donato and Pascual excluded their children as to the right to inherit from Agatona
Sagario Paulmitan, their mother.
From the time of the death of Agatona Sagario Paulmitan to the subsequent passing away of her
son Pascual in 1953, the estate remained unpartitioned. Article 1078 of the Civil Code provides:
"Where there are two or more heirs, the whole estate of the decedent is, before its partition, owned
in common by such heirs, subject to the payment of debts of the deceased." 12 Donato and
Pascual Paulmitan were, therefore, co-owners of the estate left by their mother as no partition was
ever made.
When Pascual Paulmitan died intestate in 1953, his children, the respondents, succeeded him in
the co-ownership of the disputed property. Pascual Paulmitan's right of ownership over an
undivided portion of the property passed on to his children, who, from the time of Pascual's death,
became co-owners with their uncle Donato over the disputed decedent estate.
Petitioner Juliana P. Fanesa claims ownership over Lot No. 1091 by virtue of two transactions,
namely: (a) the sale made in her favor by her father Donato Paulmitan; and (b) her redemption of
the land from the Provincial of Negros Occidental after it was forfeited for non-payment of taxes.
When Donato Paulmitan sold on May 28, 1974 Lot No. 1091 to his daughter Juliana P. Fanesa, he
was only a co-owner with respondents and as such, he could only sell that portion which may be
allotted to him upon termination of the co-ownership. 13 The sale did not prejudice the rights of
respondents to one half (1/2) undivided share of the land which they inherited from their father. It
did not vest ownership in the entire land with the buyer but transferred only the seller's pro-
indiviso share in the property 14 and consequently made the buyer a co-owner of the land until it is
partitioned. In Bailon-Casilao v. Court of Appeals, 15 the Court, through Justice Irene R. Cortes,
outlined the effects of a sale by one co-owner without the consent of all the co-owners, thus:
The rights of a co-owner of a certain property are clearly specified in Article 493
of the Civil Code, Thus:
Art. 493. Each co-owner shall have the full ownership of his part and of the fruits
and benefits pertaining thereto, and he may therefore alienate, assign or
mortgage it and even substitute another person its enjoyment, except when
personal rights are involved. But the effect of the alienation or mortgage, with
respect to the co-owners, shall be limited to the portion which may be allotted to
him in the division upon the termination of the co-ownership. [Emphasis supplied.]
As early as 1923, this Court has ruled that even if a co-owner sells the whole
property as his, the sale will affect only his own share but not those of the other
co-owners who did not consent to the sale [Punsalan v. Boon Liat, 44 Phil. 320
(1923)]. This is because under the aforementioned codal provision, the sale or
other disposition affects only his undivided share and the transferee gets only
what would correspond to his grantor in the partition of the thing owned in
 common [Ramirez v. Bautista, 14 Phil. 528 (1909)]. Consequently, by virtue of
the sales made by Rosalia and Gaudencio Bailon which are valid with respect to
their proportionate shares, and the subsequent transfers which culminated in the
sale to private respondent Celestino Afable, the said Afable thereby became a
co-owner of the disputed parcel of land as correctly held by the lower court since
the sales produced the effect of substituting the buyers in the enjoyment thereof
[Mainit v. Bandoy, 14 Phil. 730 (1910)].
From the foregoing, it may be deduced that since a co-owner is entitled to sell his
undivided share, a sale of the entire property by one co-owner without the
consent of the other co-owners is not null and void. However, only the rights of
the co-owner-seller are transferred, thereby making the buyer a co-owner of the
property.
Applying this principle to the case at bar, the sale by petitioner Donato Paulmitan of the land to his
daughter, petitioner Juliana P. Fanesa, did not give to the latter ownership over the entire land but
merely transferred to her the one half (1/2) undivided share of her father, thus making her the co-
owner of the land in question with the respondents, her first cousins.
Petitioner Juliana P. Fanesa also claims ownership of the entire property by virtue of the fact that
when the Provincial Government of Negros Occidental bought the land after it was forfeited for
non-payment of taxes, she redeemed it.
The contention is without merit.
The redemption of the land made by Fanesa did not terminate the co-ownership nor give her title
to the entire land subject of the co-ownership. Speaking on the same issue raised by petitioners,
the Court, in Adille v. Court of Appeals, 16 resolved the same with the following pronouncements:
The petition raises a purely legal issue: May a co-owner acquire exclusive
ownership over the property held in common?
Essentially, it is the petitioners' contention that the property subject of dispute
devolved upon him upon the failure of his co-heirs to join him in its redemption
within the period required by law. He relies on the provisions of Article 1515 of
the old Civil Code, Article 1613 of the present Code, giving the vendee a retro the
right to demand redemption of the entire property.
There is no merit in this petition.
The right of repurchase may be exercised by co-owner with respect to his share
alone (CIVIL CODE, art. 1612, CIVIL CODE (1889), art. (1514.). While the
records show that petitioner redeemed the property in its entirety, shouldering the
expenses therefor, that did not make him the owner of all of it. In other words, it
did not put to end the existing state of co-ownership (Supra, Art. 489). There is
no doubt that redemption of property entails a necessary expense. Under the
Civil Code:
Art. 488. Each co-owner shall have a right to compel the other co-owners to
contribute to the expenses of preservation of the thing or right owned in common
and to the taxes. Any one of the latter may exempt himself from this obligation by
renouncing so much of his undivided interest as may be equivalent to his share
of the expenses and taxes. No such waiver shall be made if it is prejudicial to the
co-ownership.
The result is that the property remains to be in a condition of co-ownership. While
a vendee a retro, under Article 1613 of the Code, "may not be compelled to
consent to a partial redemption," the redemption by one co-heir or co-owner of
the property in its totality does not vest in him ownership over it. Failure on the
part of all the co-owners to redeem it entitles the vendee a retro to retain the
property and consolidate title thereto in his name (Supra, art. 1607). But the
provision does not give to the redeeming co-owner the right to the entire property.
It does not provide for a mode of terminating a co-ownership.
Although petitioner Fanesa did not acquire ownership over the entire lot by virtue of the
redemption she made, nevertheless, she did acquire the right to reimbursed for half of the
redemption price she paid to the Provincial Government of Negros Occidental on behalf of her co-
owners. Until reimbursed, Fanesa hold a lien upon the subject property for the amount due her. 17
Finally, petitioners dispute the order of the trial court, which the Court of Appeals affirmed, for
them to pay private respondents P5,000.00 per year from 1966 until the partition of the estate
which represents the share of private respondents in the fruits of the land. According to petitioners,
the land is being leased for P2,000.00 per year only. This assigned error, however raises a factual
question. The settled rule is that only questions of law may be raised in a petition for review. As a
general rule, findings of fact made by the trial court and the Court of Appeals are final and
conclusive and cannot be reviewed on appeal. 18
WHEREFORE, the petition is DENIED and the decision of the Court of Appeals AFFIRMED.
SO ORDERED.
Gutierrez, Jr., Bidin, Davide, Jr., Romero and Melo, JJ., concur.
 Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 76351 October 29, 1993
VIRGILIO B. AGUILAR, petitioner,
vs.
COURT OF APPEALS and SENEN B. AGUILAR, respondents.
BELLOSILLO, J.:
This is a petition for review on certiorari seeking to reverse and set aside the Decision of the Court
of Appeals in CA-GR CV No. 03933 declaring null and void the orders of 23 and 26 April, 1979,
the judgment by default of 26 July 1979, and the order of 22 October 1979 of the then Court of
First Instance of Rizal, Pasay City, Branch 30, and directing the trial court to set the case for pre-
trial conference.
Petitioner Virgilio and respondent Senen are brothers; Virgilio is the youngest of seven (7) children
of the late Maximiano Aguilar, while Senen is the fifth. On 28 October 1969, the two brothers
purchased a house and lot in Parañaque where their father could spend and enjoy his remaining
years in a peaceful neighborhood. Initially, the brothers agreed that Virgilio's share in the co-
ownership was two-thirds while that of Senen was one-third. By virtue of a written memorandum
dated 23 February 1970, Virgilio and Senen agreed that henceforth their interests in the house
and lot should be equal, with Senen assuming the remaining mortgage obligation of the original
owners with the Social Security System (SSS) in exchange for his possession and enjoyment of
the house together with their father.
Since Virgilio was then disqualified from obtaining a loan from SSS, the brothers agreed that the
deed of sale would be executed and the title registered in the meantime in the name of Senen. It
was further agreed that Senen would take care of their father and his needs since Virgilio and his
family were staying in Cebu.
After Maximiano Aguilar died in 1974, petitioner demanded from private respondent that the latter
vacate the house and that the property be sold and proceeds thereof divided among them.
Because of the refusal of respondent to give in to petitioner's demands, the latter filed on 12
January 1979 an action to compel the sale of the house and lot so that the they could divide the
proceeds between them.
In his complaint, petitioner prayed that the proceeds of the sale, be divided on the basis of two-
thirds (2/3) in his favor and one-third (1/3) to respondent. Petitioner also prayed for monthly rentals
for the use of the house by respondent after their father died.
In his answer with counterclaim, respondent alleged that he had no objection to the sale as long
as the best selling price could be obtained; that if the sale would be effected, the proceeds thereof
should be divided equally; and, that being a co-owner, he was entitled to the use and enjoyment of
the property.
Upon issues being joined, the case was set for pre-trial on 26 April 1979 with the lawyers of both
parties notified of the pre-trial, and served with the pre-trial order, with private respondent
executing a special power of attorney to his lawyer to appear at the pre-trial and enter into any
amicable settlement in his behalf.1
On 20 April 1979, Atty. Manuel S. Tonogbanua, counsel for respondent, filed a motion to cancel
pre-trial on the ground that he would be accompanying his wife to Dumaguete City where she
would be a principal sponsor in a wedding.
On 23 April 1979, finding the reasons of counsel to be without merit, the trial court denied the
motion and directed that the pre-trial should continue as scheduled.
When the case was called for pre-trial as scheduled on 26 April 1979, plaintiff and his counsel
appeared. Defendant did not appear; neither his counsel in whose favor he executed a special
power of attorney to represent him at the pre-trial. Consequently, the trial court, on motion of
plaintiff, declared defendant as in default and ordered reception of plaintiff's evidence ex parte.
On 7 May 1979, defendant through counsel filed an omnibus motion to reconsider the order of
default and to defer reception of evidence. The trial court denied the motion and plaintiff presented
his evidence.
On 26 July 1979, rendering judgment by default against defendant, the trial court found him and
plaintiff to be co-owners of the house and lot, in equal shares on the basis of their written
agreement. However, it ruled that plaintiff has been deprived of his participation in the property by
defendant's continued enjoyment of the house and lot, free of rent, despite demands for rentals
and continued maneuvers of defendants, to delay partition. The trial court also upheld the right of
plaintiff as co-owner to demand partition. Since plaintiff could not agree to the amount offered by
defendant for the former's share, the trial court held that this property should be sold to a third
person and the proceeds divided equally between the parties.
The trial court likewise ordered defendant to vacate the property and pay plaintiff P1,200.00 as
rentals2 from January 1975 up to the date of decision plus interest from the time the action was
filed.
On 17 September 1979, defendant filed an omnibus motion for new trial but on 22 October 1979
the trial court denied the motion.
Defendant sought relief from the Court of Appeals praying that the following orders and decision of
the trial court be set aside: (a) the order of 23 April 1970 denying defendants motion for
postponement of the pre-trial set on 26 April 1979; (b) the order of 26 April 1979 declaring him in
default and authorizing plaintiff to present his evidence ex-parte; (e) the default judgment of 26
July 1979; and, (d) the order dated 22 October 1979 denying his omnibus motion for new trial.
On 16 October 1986, the Court of Appeals set aside the order of the trial court of 26 April 1979 as
well as the assailed judgment rendered by default., The appellate court found the explanation of
counsel for defendant in his motion to cancel pre-trial as satisfactory and devoid of a manifest
intention to delay the disposition of the case. It also ruled that the trial court should have granted
the motion for postponement filed by counsel for defendant who should not have been declared as
in default for the absence of his counsel.
Petitioner now comes to us alleging that the Court of Appeals erred (1) in not holding that the
motion of defendant through counsel to cancel the pre-trial was dilatory in character and (2) in
remanding the case to the trial court for pre-trial and trial.
The issues to be resolved are whether the trial court correctly declared respondent as in default for
his failure to appear at the pre-trial and in allowing petitioner to present his evidence ex-parte, and
whether the trial court correctly rendered the default judgment against respondent.
We find merit in the petition.
As regards the first issue, the law is clear that the appearance of parties at the pre-trial is
mandatory.3 A party who fails to appear at a pre-trial conference may be non-suited or considered
as in default.4 In the case at bar, where private respondent and counsel failed to appear at the
scheduled pre-trial, the trial, court has authority to declare respondent in default.5
Although respondent's counsel filed a motion to postpone pre-trial hearing, the grant or denial
thereof is within the sound discretion of the trial court, which should take into account two factors
in the grant or denial of motions for postponement, namely: (a) the reason for the postponement
and (b) the merits of the case of movant.6
In the instant case, the trial court found the reason stated in the motion of counsel for respondent
to cancel the pre-trial to be without merit. Counsel's explanation that he had to go to by boat as
early as 25 March 1979 to fetch his wife and accompany her to a wedding in Dumaguete City on
27 April 1979 where she was one of the principal sponsors, cannot be accepted. We find it
insufficient to justify postponement of the pre-trial, and the Court of Appeals did not act wisely in
overruling the denial. We sustain the trial court and rule that it did not abuse its discretion in
denying the postponement for lack of merit. Certainly, to warrant a postponement of a mandatory
process as pre-trial would require much more than mere attendance in a social function. It is time
indeed we emphasize that there should be much more than mere perfunctory treatment of the pre-
trial procedure. Its observance must be taken seriously if it is to attain its objective, i.e., the speedy
and inexpensive disposition of cases.
Moreover, the trial court denied the motion for postponement three (3) days before the scheduled
pre-trial. If indeed, counsel for respondent could not attend the pre-trial on the scheduled date,
respondent at least should have personally appeared in order not to be declared as in default. But,
since nobody appeared for him, the order of the trial court declaring him as in default and directing
the presentation of petitioner's evidence ex parte was proper.7
With regard to the merits of the judgment of the trial court by default, which respondent appellate
court did not touch upon in resolving the appeal, the Court holds that on the basis of the pleadings
of the parties and the evidence presented ex parte, petitioner and respondents are co-owners of
subject house and lot in equal shares; either one of them may demand the sale of the house and
lot at any time and the other cannot object to such demand; thereafter the proceeds of the sale
shall be divided equally according to their respective interests.
Private respondent and his family refuse to pay monthly rentals to petitioner from the time their
father died in 1975 and to vacate the house so that it can be sold to third persons. Petitioner
alleges that respondent's continued stay in the property hinders its disposal to the prejudice of
petitioner. On the part of petitioner, he claims that he should be paid two-thirds (2/3) of a monthly
rental of P2,400.00 or the sum of P1,600.00.
In resolving the dispute, the trial court ordered respondent to vacate the property so that it could
be sold to third persons and the proceeds divided between them equally, and for respondent to
pay petitioner one-half (1/2) of P2,400.00 or the sum of P1,200.00 as monthly rental, conformably
with their stipulated sharing reflected in their written agreement.
We uphold the trial court in ruling in favor of petitioner, except as to the effectivity of the payment
of monthly rentals by respondent as co-owner which we here declare to commence only after the
trial court ordered respondent to vacate in accordance with its order of 26 July 1979.
Article 494 of the Civil Code provides that no co-owner shall be obliged to remain in the co-
ownership, and that each co-owner may demand at any time partition of the thing owned in
common insofar as his share is concerned. Corollary to this rule, Art. 498 of the Code states that
whenever the thing is essentially, indivisible and the co-owners cannot agree that it be, allotted to
one of them who shall indemnify the others, it shall be sold and its proceeds accordingly
distributed. This is resorted to (1) when the right to partition the property is invoked by any of the
co-owners but because of the nature of the property it cannot be subdivided or its subdivision
would prejudice the interests of the co-owners, and (b) the co-owners are not in agreement as to
who among them shall be allotted or assigned the entire property upon proper reimbursement of
the co-owners. In one case,8 this Court upheld the order of the trial court directing the holding of a
public sale of the properties owned in common pursuant to Art. 498 of the Civil Code.
However, being a co-owner respondent has the right to use the house and lot without paying any
compensation to petitioner, as he may use the property owned in common long as it is in
accordance with the purpose for which it is intended and in a manner not injurious to the interest of
the other co-owners.9 Each co-owner of property held pro indiviso exercises his rights over the
whole property and may use and enjoy the same with no other limitation than that he shall not
injure the interests of his co-owners, the reason being that until a division is made, the respective
share of each cannot be determined and every co-owner exercises, together with his co-
participants joint ownership over the pro indiviso property, in addition to his use and enjoyment of
the
same. 10

Since petitioner has decided to enforce his right in court to end the co-ownership of the house and
lot and respondent has not refuted the allegation that he has been preventing the sale of the
property by his continued occupancy of the premises, justice and equity demand that respondent
and his family vacate the property so that the sale can be effected immediately. In fairness to
petitioner, respondent should pay a rental of P1,200.00 per month, with legal interest; from the
time the trial court ordered him to vacate, for the use and enjoyment of the other half of the
property appertaining to petitioner.

When petitioner filed an action to compel the sale of the property and the trial court granted the
petition and ordered the ejectment of respondent, the co-ownership was deemed terminated and
the right to enjoy the possession jointly also ceased. Thereafter, the continued stay of respondent
and his family in the house prejudiced the interest of petitioner as the property should have been
sold and the proceeds divided equally between them. To this extent and from then on, respondent
should be held liable for monthly rentals until he and his family vacate.

WHEREFORE, the petition is GRANTED. The assailed Decision of the Court of Appeals dated 16
October 1986 is REVERSED and SET ASIDE. The decision of the trial court in Civil Case No.
69.12-P dated 16 July 1979 is REINSTATED, with the modification that respondent Senen B.
Aguilar is ordered to vacate the premises in question within ninety (90) days from receipt of this
and to pay petitioner Virgilio B. Aguilar a monthly rental of P1,200.00 with interest at the legal rate
from the time he received the decision of the trial court directing him to vacate until he effectively
leaves the premises.

The trial court is further directed to take immediate steps to implement this decision conformably
with Art. 498 of the Civil Code and the Rules of Court. This decision is final and executory.

SO ORDERED.

Cruz, Davide, Jr., Quiason, JJ., concur.

 Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. L-33187 March 31, 1980
CORNELIO PAMPLONA alias GEMINIANO PAMPLONA and APOLONIA ONTE, petitioners,
vs.
VIVENCIO MORETO, VICTOR MORETO, ELIGIO MORETO, MARCELO MORETO, PAULINA
MORETO, ROSARIO MORETO, MARTA MORETO, SEVERINA MENDOZA, PABLO MENDOZA,
LAZARO MENDOZA, VICTORIA TUIZA, JOSEFINA MORETO, LEANDRO MORETO and
LORENZO MENDOZA, respondents.
GUERRERO, J.:
This is a petition for certiorari by way of appeal from the decision of the Court of Appeals 1 in CA-
G.R. No. 35962-R, entitled "Vivencio Moreto, et al., Plaintiff-Appellees vs. Cornelio Pamplona, et
al., Defendants-Appellants," affirming the decision of the Court of First Instance of Laguna, Branch
I at Biñan.
The facts, as stated in the decision appealed from, show that:
Flaviano Moreto and Monica Maniega were husband and wife. During their marriage, they
acquired adjacent lots Nos. 1495, 4545, and 1496 of the Calamba Friar Land Estate, situated in
Calamba, Laguna, containing 781-544 and 1,021 square meters respectively and covered by
certificates of title issued in the name of "Flaviano Moreto, married to Monica Maniega."
The spouses Flaviano Moreto and Monica Maniega begot during their marriage six (6) children,
namely, Ursulo, Marta, La Paz, Alipio, Pablo, and Leandro, all surnamed Moreto.
Ursulo Moreto died intestate on May 24, 1959 leaving as his heirs herein plaintiffs Vivencio,
Marcelo, Rosario, Victor, Paulina, Marta and Eligio, all surnamed Moreto.
Marta Moreto died also intestate on April 30, 1938 leaving as her heir plaintiff Victoria Tuiza.
La Paz Moreto died intestate on July 17, 1954 leaving the following heirs, namely, herein plaintiffs
Pablo, Severina, Lazaro, and Lorenzo, all surnamed Mendoza.
Alipio Moreto died intestate on June 30, 1943 leaving as his heir herein plaintiff Josefina Moreto.
Pablo Moreto died intestate on April 25, 1942 leaving no issue and as his heirs his brother plaintiff
Leandro Moreto and the other plaintiffs herein.
On May 6, 1946, Monica Maniega died intestate in Calamba, Laguna.
On July 30, 1952, or more than six (6) years after the death of his wife Monica Maniega, Flaviano
Moreto, without the consent of the heirs of his said deceased wife Monica, and before any
liquidation of the conjugal partnership of Monica and Flaviano could be effected, executed in favor
of Geminiano Pamplona, married to defendant Apolonia Onte, the deed of absolute sale (Exh. "1")
covering lot No. 1495 for P900.00. The deed of sale (Exh. "1") contained a description of lot No.
1495 as having an area of 781 square meters and covered by transfer certificate of title No. 14570
issued in the name of Flaviano Moreto, married to Monica Maniega, although the lot was acquired
during their marriage. As a result of the sale, the said certificate of title was cancelled and a new
transfer certificate of title No. T-5671 was issued in the name of Geminiano Pamplona married to
Apolonia Onte (Exh. "A").
After the execution of the above-mentioned deed of sale (Exh. "1"), the spouses Geminiano
Pamplona and Apolonia Onte constructed their house on the eastern part of lot 1496 as Flaviano
Moreto, at the time of the sale, pointed to it as the land which he sold to Geminiano Pamplona.
Shortly thereafter, Rafael Pamplona, son of the spouses Geminiano Pamplona and Apolonia Onte,
also built his house within lot 1496 about one meter from its boundary with the adjoining lot. The
vendor Flaviano Moreto and the vendee Geminiano Pamplona thought all the time that the portion
of 781 square meters which was the subject matter of their sale transaction was No. 1495 and so
lot No. 1495 appears to be the subject matter in the deed of sale (Exh. "1") although the fact is that
the said portion sold thought of by the parties to be lot No. 1495 is a part of lot No. 1496.
From 1956 to 1960, the spouses Geminiano Pamplona and Apolonio Onte enlarged their house
and they even constructed a piggery corral at the back of their said house about one and one-half
meters from the eastern boundary of lot 1496.
On August 12, 1956, Flaviano Moreto died intestate. In 1961, the plaintiffs demanded on the
defendants to vacate the premises where they had their house and piggery on the ground that
Flaviano Moreto had no right to sell the lot which he sold to Geminiano Pamplona as the same
belongs to the conjugal partnership of Flaviano and his deceased wife and the latter was already
dead when the sale was executed without the consent of the plaintiffs who are the heirs of Monica.
The spouses Geminiano Pamplona and Apolonia Onte refused to vacate the premises occupied
by them and hence, this suit was instituted by the heirs of Monica Maniega seeking for the
declaration of the nullity of the deed of sale of July 30, 1952 above-mentioned as regards one-half
of the property subject matter of said deed; to declare the plaintiffs as the rightful owners of the
other half of said lot; to allow the plaintiffs to redeem the one-half portion thereof sold to the
defendants. "After payment of the other half of the purchase price"; to order the defendants to
vacate the portions occupied by them; to order the defendants to pay actual and moral damages
and attorney's fees to the plaintiffs; to order the defendants to pay plaintiffs P120.00 a year from
August 1958 until they have vacated the premises occupied by them for the use and occupancy of
the same.
The defendants claim that the sale made by Flaviano Moreto in their favor is valid as the lot sold is
registered in the name of Flaviano Moreto and they are purchasers believing in good faith that the
vendor was the sole owner of the lot sold.
After a relocation of lots 1495, 1496 and 4545 made by agreement of the parties, it was found out
that there was mutual error between Flaviano Moreto and the defendants in the execution of the
deed of sale because while the said deed recited that the lot sold is lot No. 1495, the real intention
of the parties is that it was a portion consisting of 781 square meters of lot No. 1496 which was the
subject matter of their sale transaction.
After trial, the lower court rendered judgment, the dispositive part thereof being as follows:
WHEREFORE, judgment is hereby rendered for the plaintiffs declaring the deed
of absolute sale dated July 30, 1952 pertaining to the eastern portion of Lot 1496
covering an area of 781 square meters null and void as regards the 390.5 square
meters of which plaintiffs are hereby declared the rightful owners and entitled to
its possession.
The sale is ordered valid with respect to the eastern one-half (1/2) of 1781
square meters of Lot 1496 measuring 390.5 square meters of which defendants
are declared lawful owners and entitled to its possession.
After proper survey segregating the eastern one-half portion with an area of
390.5 square meters of Lot 1496, the defendants shall be entitled to a certificate
of title covering said portion and Transfer Certificate of Title No. 9843 of the office
of the Register of Deeds of Laguna shall be cancelled accordingly and new titles
issued to the plaintiffs and to the defendants covering their respective portions.
Transfer Certificate of Title No. 5671 of the office of the Register of Deeds of
Laguna covering Lot No. 1495 and registered in the name of Cornelio Pamplona,
married to Apolonia Onte, is by virtue of this decision ordered cancelled. The
defendants are ordered to surrender to the office of the Register of Deeds of
Laguna the owner's duplicate of Transfer Certificate of Title No. 5671 within thirty
(30) days after this decision shall have become final for cancellation in
accordance with this decision.
Let copy of this decision be furnished the Register of Deeds for the province of
Laguna for his information and guidance.
With costs against the defendants. 2
The defendants-appellants, not being satisfied with said judgment, appealed to the Court of
Appeals, which affirmed the judgment, hence they now come to this Court.
The fundamental and crucial issue in the case at bar is whether under the facts and circumstances
duly established by the evidence, petitioners are entitled to the full ownership of the property in
litigation, or only one-half of the same.
There is no question that when the petitioners purchased the property on July 30, 1952 from
Flaviano Moreto for the price of P900.00, his wife Monica Maniega had already been dead six
years before, Monica having died on May 6, 1946. Hence, the conjugal partnership of the spouses
Flaviano Moreto and Monica Maniega had already been dissolved. (Article 175, (1) New Civil
Code; Article 1417, Old Civil Code). The records show that the conjugal estate had not been
inventoried, liquidated, settled and divided by the heirs thereto in accordance with law. The
necessary proceedings for the liquidation of the conjugal partnership were not instituted by the
heirs either in the testate or intestate proceedings of the deceased spouse pursuant to Act 3176
amending Section 685 of Act 190. Neither was there an extra-judicial partition between the
surviving spouse and the heirs of the deceased spouse nor was an ordinary action for partition
brought for the purpose. Accordingly, the estate became the property of a community between the
surviving husband, Flaviano Moreto, and his children with the deceased Monica Maniega in the
concept of a co-ownership.
The community property of the marriage, at the dissolution of this bond by the
death of one of the spouses, ceases to belong to the legal partnership and
becomes the property of a community, by operation of law, between the surviving
spouse and the heirs of the deceased spouse, or the exclusive property of the
widower or the widow, it he or she be the heir of the deceased spouse. Every co-
owner shall have full ownership of his part and in the fruits and benefits derived
therefrom, and he therefore may alienate, assign or mortgage it, and even
substitute another person in its enjoyment, unless personal rights are in question.
(Marigsa vs. Macabuntoc, 17 Phil. 107)
In Borja vs. Addision, 44 Phil. 895, 906, the Supreme Court said that "(t)here is no reason in law
why the heirs of the deceased wife may not form a partnership with the surviving husband for the
management and control of the community property of the marriage and conceivably such a
partnership, or rather community of property, between the heirs and the surviving husband might
be formed without a written agreement." In Prades vs. Tecson, 49 Phil. 230, the Supreme Court
held that "(a)lthough, when the wife dies, the surviving husband, as administrator of the community
property, has authority to sell the property with• ut the concurrence of the children of the marriage,
nevertheless this power can be waived in favor of the children, with the result of bringing about a
conventional ownership in common between the father and children as to such property; and any
one purchasing with knowledge of the changed status of the property will acquire only the
undivided interest of those members of the family who join in the act of conveyance.
It is also not disputed that immediately after the execution of the sale in 1952, the vendees
constructed their house on the eastern part of Lot 1496 which the vendor pointed out to them as
the area sold, and two weeks thereafter, Rafael who is a son of the vendees, also built his house
within Lot 1496. Subsequently, a cemented piggery coral was constructed by the vendees at the
back of their house about one and one-half meters from the eastern boundary of Lot 1496. Both
vendor and vendees believed all the time that the area of 781 sq. meters subject of the sale was
Lot No. 1495 which according to its title (T.C.T. No. 14570) contains an area of 781 sq. meters so
that the deed of sale between the parties Identified and described the land sold as Lot 1495. But
actually, as verified later by a surveyor upon agreement of the parties during the proceedings of
the case below, the area sold was within Lot 1496.
Again, there is no dispute that the houses of the spouses Cornelio Pamplona and Apolonia Onte
as well as that of their son Rafael Pamplona, including the concrete piggery coral adjacent thereto,
stood on the land from 1952 up to the filing of the complaint by the private respondents on July 25,
1961, or a period of over nine (9) years. And during said period, the private respondents who are
the heirs of Monica Maniega as well as of Flaviano Moreto who also died intestate on August 12,
1956, lived as neighbors to the petitioner-vendees, yet lifted no finger to question the occupation,
possession and ownership of the land purchased by the Pamplonas, so that We are persuaded
and convinced to rule that private respondents are in estoppel by laches to claim half of the
property, in dispute as null and void. Estoppel by laches is a rule of equity which bars a claimant
from presenting his claim when, by reason of abandonment and negligence, he allowed a long
time to elapse without presenting the same. (International Banking Corporation vs. Yared, 59 Phil.
92)
We have ruled that at the time of the sale in 1952, the conjugal partnership was already dissolved
six years before and therefore, the estate became a co-ownership between Flaviano Moreto, the
surviving husband, and the heirs of his deceased wife, Monica Maniega. Article 493 of the New
Civil Code is applicable and it provides a follows:
Art. 493. Each co-owner shall have the full ownership of his part and of the fruits
and benefits pertaining thereto, and he may therefore alienate, assign or
mortgage it, and even substitute another person in its enjoyment, except when
personal rights are involve. But the effect of the alienation or the mortgage, with
respect to the co-owners, shall be limited to the portion which may be allotted to
him in the division upon the termination of the co-ownership.
We agree with the petitioner that there was a partial partition of the co-ownership when at the time
of the sale Flaviano Moreto pointed out the area and location of the 781 sq. meters sold by him to
the petitioners-vendees on which the latter built their house and also that whereon Rafael, the son
of petitioners likewise erected his house and an adjacent coral for piggery.
Petitioners point to the fact that spouses Flaviano Moreto and Monica Maniega owned three
parcels of land denominated as Lot 1495 having an area of 781 sq. meters, Lot 1496 with an area
of 1,021 sq. meters, and Lot 4545 with an area of 544 sq. meters. The three lots have a total area
of 2,346 sq. meters. These three parcels of lots are contiguous with one another as each is
bounded on one side by the other, thus: Lot 4545 is bounded on the northeast by Lot 1495 and on
the southeast by Lot 1496. Lot 1495 is bounded on the west by Lot 4545. Lot 1496 is bounded on
the west by Lot 4545. It is therefore, clear that the three lots constitute one big land. They are not
separate properties located in different places but they abut each other. This is not disputed by
private respondents. Hence, at the time of the sale, the co-ownership constituted or covered these
three lots adjacent to each other. And since Flaviano Moreto was entitled to one-half pro-indiviso
of the entire land area or 1,173 sq. meters as his share, he had a perfect legal and lawful right to
dispose of 781 sq. meters of his share to the Pamplona spouses. Indeed, there was still a
remainder of some 392 sq. meters belonging to him at the time of the sale.
We reject respondent Court's ruling that the sale was valid as to one-half and invalid as to the
other half for the very simple reason that Flaviano Moreto, the vendor, had the legal right to more
than 781 sq. meters of the communal estate, a title which he could dispose, alienate in favor of the
vendees-petitioners. The title may be pro-indiviso or inchoate but the moment the co-owner as
vendor pointed out its location and even indicated the boundaries over which the fences were to
be erectd without objection, protest or complaint by the other co-owners, on the contrary they
acquiesced and tolerated such alienation, occupation and possession, We rule that a factual
partition or termination of the co-ownership, although partial, was created, and barred not only the
vendor, Flaviano Moreto, but also his heirs, the private respondents herein from asserting as
against the vendees-petitioners any right or title in derogation of the deed of sale executed by said
vendor Flaiano Moreto.
Equity commands that the private respondents, the successors of both the deceased spouses,
Flaviano Moreto and Monica Maniega be not allowed to impugn the sale executed by Flaviano
Moreto who indisputably received the consideration of P900.00 and which he, including his
children, benefitted from the same. Moreover, as the heirs of both Monica Maniega and Flaviano
Moreto, private respondents are duty-bound to comply with the provisions of Articles 1458 and
1495, Civil Code, which is the obligation of the vendor of the property of delivering and transfering
the ownership of the whole property sold, which is transmitted on his death to his heirs, the herein
private respondents. The articles cited provide, thus:
Art. 1458. By the contract of sale one of the contracting parties obligates himself
to transfer the ownership of and to deliver a determinate thing, and the other part
to pay therefore a price certain in money or its equivalent.
A contract of sale may be absolute or conditionial.
Art. 1495. The vendor is bound to transfer the ownership of and deliver, as well
as warrant the thing which is the object of the sale.
Under Article 776, New Civil Code, the inheritance which private respondents received from their
deceased parents and/or predecessors-in-interest included all the property rights and obligations
which were not extinguished by their parents' death. And under Art. 1311, paragraph 1, New Civil
Code, the contract of sale executed by the deceased Flaviano Moreto took effect between the
parties, their assigns and heirs, who are the private respondents herein. Accordingly, to the private
respondents is transmitted the obligation to deliver in full ownership the whole area of 781 sq.
meters to the petitioners (which was the original obligation of their predecessor Flaviano Moreto)
and not only one-half thereof. Private respondents must comply with said obligation.
The records reveal that the area of 781 sq. meters sold to and occupied by petitioners for more
than 9 years already as of the filing of the complaint in 1961 had been re-surveyed by private land
surveyor Daniel Aranas. Petitioners are entitled to a segregation of the area from Transfer
Certificate of Title No. T-9843 covering Lot 1496 and they are also entitled to the issuance of a
new Transfer Certificate of Title in their name based on the relocation survey.
WHEREFORE, IN VIEW OF THE FOREGOING, the judgment appealed from is hereby
AFFIRMED with modification in the sense that the sale made and executed by Flaviano Moreto in
favor of the petitioners-vendees is hereby declared legal and valid in its entirely.
Petitioners are hereby declared owners in full ownership of the 781 sq. meters at the eastern
portion of Lot 1496 now occupied by said petitioners and whereon their houses and piggery coral
stand.
The Register of Deeds of Laguna is hereby ordered to segregate the area of 781 sq. meters from
Certificate of Title No. 9843 and to issue a new Transfer Certificate of Title to the petitioners
covering the segregated area of 781 sq. meters.

No costs.

SO ORDERED.

Teehankee (Chairman), Makasiar, Fernandez, De Castro and Melencio-Herrera, JJ., concur.

 Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-25014 October 17, 1973
DOLORES LAHORA VDA. DE CASTRO, ARSENIO DE CASTRO, JR., WILFREDO DE
CASTRO, IRINEO DE CASTRO and VIRGINIA DE CASTRO ALEJANDRO, (in substitution for
the deceased defendant-appellant ARSENIO DE CASTRO, SR.)., petitioners,
vs.
GREGORIO ATIENZA, respondent.
TEEHANKEE, J.:
The Court rejects petitioners' appeal as without merit and affirms the judgment of the appellate
court. Petitioners' predecessor-in-interest as co-owner of an undivided one-half interest in the
fishpond could validly lease his interest to a third party, respondent Atienza, independently of his
co-owner (although said co-owner had also leased his other undivided one-half interest to the
same third party) and could likewise by mutual agreement independently cancel his lease
agreement with said third party. Said predecessor-in-interest (and petitioners who have substituted
him as his heirs) therefore stands liable on his express undertaking to refund the advance rental
paid to him by the lessee on the cancelled lease and cannot invoke the non-cancellation of the co-
owner's lease to elude such liability.
The Court of Appeals, in its decision affirming in toto the judgment of the Manila court of first
instance ordering therein defendant-appellant Arsenio de Castro, Sr. (now deceased and
substituted by above-named petitioners as his heirs) "to return to the plaintiff (respondent)
Gregorio Atienza the sum P2,500.00 with legal interest from the date of the filing of complaint until
fully paid plus the sum of P250.00 as attorney's fees and the costs of the suit", found the following
facts to undisputed:
On January 24, 1956 the brothers Tomas de Castro and Arsenio de Castro, Sr.
leased to plaintiff a fishpond containing an area of 26 hectares situated in Polo,
Bulacan and forming part of a bigger parcel of land covered by Transfer
Certificate of Title No. 196450 of the registry of the property of Bulacan. The
lessors are co-owners in equal shares of the leased property.
According to the contract of lease (Exh. 1) the term of the lease was for five
years from January 24, 1956 at a rental of P5,000 a year, the first year's rental to
be paid on February 1, 1956, the second on February 1, 1957 and the rental for
the last three years on February 1, 1958. The first year's rental was paid on time.
In the meantime, Tomas de Castro died.
In the month of November, 1956, plaintiff as lessee and defendant Arsenio de
Castro, Sr. as one of the lessors, agreed to set aside and annul the contract of
lease and for this purpose an agreement (Exh. A) was signed by them, Exhibit A
as signed by plaintiff and defendant shows that Felisa Cruz Vda. de Castro,
widow of Tomas de Castro, was intended to be made a party thereof in her
capacity as representative of the heirs of Tomas Castro.
Condition No. 2 of Exhibit A reads as follows:
"2. Na sa pamamagitan nito ay pinawawalang kabuluhan namin ang nasabing
kasulatan at nagkasundo kami na ang bawat isa sa amin ni Arsenio de Castro at
Felisa Cruz Vda. de Castro ay isauli kay GREGORIO ATIENZA ang tig
P2,500.00 o kabuuang halagang P5,000.00 na paunang naibigay nito alinsunod
sa nasabing kasulatan; na ang nasabing tig P2,500.00 ay isasauli ng bawat isa
sa amin sa o bago dumating ang Dec. 30, 1956."
Felisa Cruz Vda. de Castro refused to sign Exhibit A. Defendant did not pay the
P2,500.00 which under the above-quoted paragraph of Exhibit A, he should have
paid on December 30, 1956. Demand for payment was made by plaintiff's
counsel on January 7, 1957 but to no avail, hence the present action.
On the conflicting contentions between the parties as to who between them would attend to
securing the signature of Mrs. Felisa Cruz Vda. de Castro (widow of Tomas de Castro) to the
agreement of cancellation of the lease with respondent Atienza, the appellate court found that "the
testimony of the defendant (Arsenio de Castro, Sr.) ... supports the contention of the plaintiff
(Atienza) "that it was the defendant Arsenio who was interested and undertook to do so, citing
Arsenio's own declaration that "I agreed to sign this document (referring to the cancellation)
because of my desire to cancel our original agreement" and that his purpose in obtaining the
cancellation of said lease agreement with plaintiff Atienza was "(B)ecause I had the intention of
having said fishpond leased to other persons and I cannot lease it to third parties unless I can
secure the signature of Felisa Vda. de Castro."
The appellate court thus held in effect that as Arsenio "was the one interested in cancelling the
lease (Exh. 1), it stands to reason that he most probably undertook to obtain the signature of Mrs.
Castro [widow and successor-in-interest of his brother Tomas]" and that he could not invoke his
own failure to obtain such signature to elude his own undertaking and liability to refund respondent
(plaintiff) his share of the rental paid in advance by respondent on the cancelled lease in the sum
of P2,500.00.
The appellate court furthermore correctly held that the consent or concurrence of Felisa Vda. de
Castro (as co-owner in succession of Tomas) was not an essential condition to the validity and
effectivity of the agreement of cancellation of the lease (Exhibit A) as between Arsenio and
respondent-lessee, contrary to petitioners' claim, holding that "(S)ince there is no specific provision
in Exhibit A supporting defendant's claim, we are not prepared to supply such condition unless the
same can be deduced from other evidence or unless the terms of Exhibit A cannot be performed
by plaintiff and defendant without Mrs. Castro being bound as a party thereto."

The issue is simply reduced to whether Arsenio as co-owner of the fishpond owned pro-indiviso by
him with his brother Tomas (succeeded by Felisa Vda. de Castro) could validly lease his half-
interest to a third party (respondent Atienza) independently of his
co-owner, and in case his co-owner also leased his other half interest to the same third party,
whether Arsenio could cancel his own lease agreement with said third party?

The appellate court correctly resolved the issue thus: "Our view of the contract of lease Exhibit 1 is
that each of the Castro brothers, leased his undivided one-half interest in the fishpond they owned
in common to the plaintiff. Could one of them have validly leased his interest without the other co-
owner leasing his own? The answer to this is given by appellant in his own brief (p. 14) when he
said that it would result in a partnership between the lessee and the owner of the other undivided
half. If the lease could be entered into partially by one of the co-owners, insofar as his interest is
concerned, then the lease, Exhibit 1, can also be cancelled partially as between plaintiff and
defendant. Therefore, we conclude that the consent of Mrs. Felisa Cruz Vda. de Castro is not
essential for the cancellation of the lease of defendant's one-half undivided share in the fishpond
to plaintiff."

The appellate court's judgment is fully supported by the Civil Code provisions on the rights and
prerogatives of co-owners, and specifically by Article 493 which expressly provides that

Art. 493. Each co-owner shall have the full ownership of his part and of the fruits
and benefitspertaining thereto, and he may therefore alienate, assign or
mortgage it, and even substitute another person in its enjoyment, except when
personal rights are involved. But the effect of the alienation or the mortgage, with
respect to the co-owners, shall be limited to the portion which may be alloted to
him in the division upon the termination of the co-ownership. *

ACCORDINGLY, the appealed judgment is hereby affirmed with costs against petitioners.

Makalintal, Actg. C.J., Zaldivar, Castro, Fernando, Barredo, Makasiar, Antonio and Esguerra, JJ.,
concur.
 FIRST DIVISION
[G.R. No. 137152. January 29, 2001]
CITY OF MANDALUYONG, petitioner, vs. ANTONIO N., FRANCISCO N., THELMA N.,
EUSEBIO N., RODOLFO N., all surnamed AGUILAR, respondents.
DECISION
PUNO, J.:
This is a petition for review under Rule 45 of the Rules of Court of the Orders dated
September 17, 1998 and December 29, 1998 of the Regional Trial Court, Branch 168, Pasig
City[1] dismissing the petitioners Amended Complaint in SCA No. 1427 for expropriation of two (2)
parcels of land in Mandaluyong City.
The antecedent facts are as follows:
On August 4, 1997, petitioner filed with the Regional Trial Court, Branch 168, Pasig City a
complaint for expropriation entitled City of Mandaluyong, plaintiff v. Antonio N., Francisco N.,
Thelma N., Eusebio N., Rodolfo N., all surnamed Aguilar, defendants. Petitioner sought to
expropriate three (3) adjoining parcels of land with an aggregate area of 1,847 square meters
registered under Transfer Certificates of Title Nos. 59780, 63766 and 63767 in the names of the
defendants, herein respondents, located at 9 de Febrero Street, Barangay Mauwag, City of
Mandaluyong; on a portion of the 3 lots, respondents constructed residential houses several
decades ago which they had since leased out to tenants until the present; on the vacant portion of
the lots, other families constructed residential structures which they likewise occupied; in 1983, the
lots were classified by Resolution No. 125 of the Board of the Housing and Urban Development
Coordinating Council as an Area for Priority Development for urban land reform under
Proclamation Nos. 1967 and 2284 of then President Marcos; as a result of this classification, the
tenants and occupants of the lots offered to purchase the land from respondents, but the latter
refused to sell; on November 7, 1996, the Sangguniang Panlungsod of petitioner, upon petition of
the Kapitbisig, an association of tenants and occupants of the subject land, adopted Resolution No.
516, Series of 1996 authorizing Mayor Benjamin Abalos of the City of Mandaluyong to initiate
action for the expropriation of the subject lots and construction of a medium-rise condominium for
qualified occupants of the land; on January 10, 1996, Mayor Abalos sent a letter to respondents
offering to purchase the said property at P3,000.00 per square meter; respondents did not answer
the letter. Petitioner thus prayed for the expropriation of the said lots and the fixing of just
compensation at the fair market value of P3,000.00 per square meter.[2]
In their answer, respondents, except Eusebio N. Aguilar who died in 1995, denied having
received a copy of Mayor Abalos offer to purchase their lots. They alleged that the expropriation of
their land is arbitrary and capricious, and is not for a public purpose; the subject lots are their only
real property and are too small for expropriation, while petitioner has several properties inventoried
for socialized housing; the fair market value of P3,000.00 per square meter is arbitrary because
the zonal valuation set by the Bureau of Internal Revenue is P7,000.00 per square meter. As
counterclaim, respondents prayed for damages of P21 million.[3]
Respondents filed a Motion for Preliminary Hearing claiming that the defenses alleged in their
Answer are valid grounds for dismissal of the complaint for lack of jurisdiction over the person of
the defendants and lack of cause of action. Respondents prayed that the affirmative defenses be
set for preliminary hearing and that the complaint be dismissed.[4] Petitioner replied.
On November 5, 1997, petitioner filed an Amended Complaint and named as an additional
defendant Virginia N. Aguilar and, at the same time, substituted Eusebio Aguilar with his
heirs. Petitioner also excluded from expropriation TCT No. 59870 and thereby reduced the area
sought to be expropriated from three (3) parcels of land to two (2) parcels totalling 1,636 square
meters under TCT Nos. 63766 and 63767.[5]
The Amended Complaint was admitted by the trial court on December 18,
1997. Respondents, who, with the exception of Virginia Aguilar and the Heirs of Eusebio Aguilar
had yet to be served with summons and copies of the Amended Complaint, filed a Manifestation
and Motion adopting their Answer with Counterclaim and Motion for Preliminary Hearing as their
answer to the Amended Complaint.[6]
The motion was granted. At the hearing of February 25, 1998, respondents presented
Antonio Aguilar who testified and identified several documentary evidence. Petitioner did not
present any evidence.Thereafter, both parties filed their respective memoranda.[7]
On September 17, 1998, the trial court issued an order dismissing the Amended Complaint
after declaring respondents as small property owners whose land is exempt from expropriation
under Republic Act No. 7279. The court also found that the expropriation was not for a public
purpose for petitioners failure to present any evidence that the intended beneficiaries of the
expropriation are landless and homeless residents of Mandaluyong. The court thus disposed of as
follows:
WHEREFORE, the Amended Complaint is hereby ordered dismissed without pronouncement as
to cost.
SO ORDERED.[8]
Petitioner moved for reconsideration. On December 29, 1998, the court denied the
motion. Hence this petition.
Petitioner claims that the trial court erred
IN UPHOLDING RESPONDENTS CONTENTION THAT THEY QUALIFY AS SMALL PROPERTY
OWNERS AND ARE THUS EXEMPT FROM EXPROPRIATION.[9]
Petitioner mainly claims that the size of the lots in litigation does not exempt the same from
expropriation in view of the fact that the said lots have been declared to be within the Area for
Priority Development (APD) No. 5 of Mandaluyong by virtue of Proclamation No. 1967, as
amended by Proclamation No. 2284 in relation to Presidential Decree No. 1517. [10] This
declaration allegedly authorizes petitioner to expropriate the property, ipso facto, regardless of the
area of the land.
Presidential Decree (P.D.) No. 1517, the Urban Land Reform Act, was issued by then
President Marcos in 1978. The decree adopted as a State policy the liberation of human
communities from blight, congestion and hazard, and promotion of their development and
modernization, the optimum use of land as a national resource for public welfare. [11] Pursuant to
this law, Proclamation No. 1893 was issued in 1979 declaring the entire Metro Manila as Urban
Land Reform Zone for purposes of urban land reform. This was amended in 1980 by Proclamation
No. 1967 and in 1983 by Proclamation No. 2284 which identified and specified 245 sites in Metro
Manila as Areas for Priority Development and Urban Land Reform Zones.
In 1992, the Congress of the Philippines passed Republic Act No. 7279, the Urban
Development and Housing Act of 1992. The law lays down as a policy that the state, in
cooperation with the private sector, undertake a comprehensive and continuing Urban
Development and Housing Program; uplift the conditions of the underprivileged and homeless
citizens in urban areas and resettlement areas by making available to them decent housing at
affordable cost, basic services and employment opportunities and provide for the rational use and
development of urban land to bring about, among others, equitable utilization of residential lands;
encourage more effective people's participation in the urban development process and improve
the capability of local government units in undertaking urban development and housing programs
and projects.[12] Towards this end, all city and municipal governments are mandated to conduct
an inventory of all lands and improvements within their respective localities, and in coordination
with the National Housing Authority, the Housing and Land Use Regulatory Board, the National
Mapping Resource Information Authority, and the Land Management Bureau, identify lands for
socialized housing and resettlement areas for the immediate and future needs of the
underprivileged and homeless in the urban areas, acquire the lands, and dispose of said lands to
the beneficiaries of the program.[13]
The acquisition of lands for socialized housing is governed by several provisions in the
law. Section 9 of R.A. 7279 provides:
Sec. 9. Priorities in the Acquisition of Land.Lands for socialized housing shall be acquired in the
following order:
(a) Those owned by the Government or any of its subdivisions, instrumentalities, or
agencies, including government-owned or controlled corporations and their
subsidiaries;
(b) Alienable lands of the public domain;
(c) Unregistered or abandoned and idle lands;
(d) Those within the declared Areas for Priority Development, Zonal Improvement
Program sites, and Slum Improvement and Resettlement Program sites which have
not yet been acquired;
(e) Bagong Lipunan Improvement of Sites and Services or BLISS Sites which have not
yet been acquired;
(f) Privately-owned lands.
Where on-site development is found more practicable and advantageous to the beneficiaries, the
priorities mentioned in this section shall not apply. The local government units shall give budgetary
priority to on-site development of government lands.
Lands for socialized housing are to be acquired in the following order: (1) government lands;
(2) alienable lands of the public domain; (3) unregistered or abandoned or idle lands; (4) lands
within the declared Areas for Priority Development (APD), Zonal Improvement Program (ZIP) sites,
Slum Improvement and Resettlement (SIR) sites which have not yet been acquired; (5) BLISS
sites which have not yet been acquired; and (6) privately-owned lands.
There is no dispute that the two lots in litigation are privately-owned and therefore last in the
order of priority acquisition. However, the law also provides that lands within the declared APDs
which have not yet been acquired by the government are fourth in the order of priority. According
to petitioner, since the subject lots lie within the declared APD, this fact mandates that the lots be
given priority in acquisition.[14]
Section 9, however, is not a single provision that can be read separate from the other
provisions of the law. It must be read together with Section 10 of R.A. 7279 which also provides:
Section 10. Modes of Land Acquisition.The modes of acquiring lands for purposes of this Act shall
include, among others, community mortgage, land swapping, land assembly or consolidation, land
banking, donation to the Government, joint-venture agreement, negotiated purchase, and
expropriation: Provided, however, That expropriation shall be resorted to only when other
modes of acquisition have been exhausted: Provided, further, That where expropriation is
resorted to, parcels of land owned by small property owners shall be exempted for
purposes of this Act: Provided, finally, That abandoned property, as herein defined, shall be
reverted and escheated to the State in a proceeding analogous to the procedure laid down in Rule
91 of the Rules of Court.[15]
For the purposes of socialized housing, government-owned and foreclosed properties shall be
acquired by the local government units, or by the National Housing Authority primarily through
negotiated purchase: Provided, That qualified beneficiaries who are actual occupants of the land
shall be given the right of first refusal.
Lands for socialized housing under R.A. 7279 are to be acquired in several modes. Among these
modes are the following: (1) community mortgage; (2) land swapping, (3) land assembly or
consolidation; (4) land banking; (5) donation to the government; (6) joint venture agreement; (7)
negotiated purchase; and (8) expropriation. The mode of expropriation is subject to two conditions:
(a) it shall be resorted to only when the other modes of acquisition have been exhausted; and (b)
parcels of land owned by small property owners are exempt from such acquisition.
Section 9 of R.A. 7279 speaks of priorities in the acquisition of lands. It enumerates the type
of lands to be acquired and the heirarchy in their acquisition. Section 10 deals with the modes of
land acquisition or the process of acquiring lands for socialized housing. These are two different
things. They mean that the type of lands that may be acquired in the order of priority in
Section 9 are to be acquired only in the modes authorized under Section 10. The acquisition
of the lands in the priority list must be made subject to the modes and conditions set forth in the
next provision. In other words, land that lies within the APD, such as in the instant case, may be
acquired only in the modes under, and subject to the conditions of, Section 10.
Petitioner claims that it had faithfully observed the different modes of land acquisition for
socialized housing under R.A. 7279 and adhered to the priorities in the acquisition for socialized
housing under said law.[16] It, however, did not state with particularity whether it exhausted the
other modes of acquisition in Section 9 of the law before it decided to expropriate the subject
lots. The law states expropriation shall be resorted to when other modes of acquisition have been
exhausted. Petitioner alleged only one mode of acquisition, i.e., by negotiated purchase. Petitioner,
through the City Mayor, tried to purchase the lots from respondents but the latter refused to
sell.[17] As to the other modes of acquisition, no mention has been made. Not even Resolution No.
516, Series of 1996 of the Sangguniang Panlungsod authorizing the Mayor of Mandaluyong to
effect the expropriation of the subject property states whether the city government tried to acquire
the same by community mortgage, land swapping, land assembly or consolidation, land banking,
donation to the government, or joint venture agreement under Section 9 of the law.
Section 9 also exempts from expropriation parcels of land owned by small property
owners.[18] Petitioner argues that the exercise of the power of eminent domain is not anymore
conditioned on the size of the land sought to be expropriated.[19] By the expanded notion of public
use, present jurisprudence has established the concept that expropriation is not anymore confined
to the vast tracts of land and landed estates, but also covers small parcels of land.[20] That only a
few could actually benefit from the expropriation of the property does not diminish its public use
character.[21] It simply is not possible to provide, in one instance, land and shelter for all who need
them.[22]
While we adhere to the expanded notion of public use, the passage of R.A. No. 7279, the
Urban Development and Housing Act of 1992 introduced a limitation on the size of the land sought
to be expropriated for socialized housing. The law expressly exempted small property owners from
expropriation of their land for urban land reform. R.A. No. 7279 originated as Senate Bill No. 234
authored by Senator Joey Lina[23] and House Bill No. 34310. Senate Bill No. 234 then provided
that one of those lands not covered by the urban land reform and housing program was land
actually used by small property owners within the just and equitable retention limit as provided
under this Act.[24] Small property owners were defined in Senate Bill No. 234 as:
4. Small Property Ownersare those whose rights are protected under Section 9, Article XIII of the
Constitution of the Philippines, who own small parcels of land within the fair and just retention limit
provided under this Act and which are adequate to meet the reasonable needs of the small
property owners family and their means of livelihood.[25]
The exemption from expropriation of lands of small-property owners was never questioned
on the Senate floor.[26] This exemption, although with a modified definition, was actually retained in
the consolidation of Senate Bill No. 234 and House Bill No. 34310 which became R.A. No. 7279. [27]
The question now is whether respondents qualify as small property owners as defined in
Section 3 (q) of R.A. 7279. Section 3 (q) provides:
Section 3 x x x (q). Small property owners refers to those whose only real property consists of
residential lands not exceeding three hundred square meters (300 sq.m.) in highly urbanized cities
and eight hundred square meters (800 sq.m.) in other urban areas.
Small-property owners are defined by two elements: (1) those owners of real property whose
property consists of residential lands with an area of not more than 300 square meters in highly
urbanized cities and 800 square meters in other urban areas; and (2) that they do not own real
property other than the same.
The case at bar involves two (2) residential lots in Mandaluyong City, a highly urbanized
city. The lot under TCT No. 63766 is 687 square meters in area and the second under TCT No.
63767 is 949 square meters, both totalling 1,636 square meters in area. TCT No. 63766 was
issued in the names of herein five (5) respondents, viz:
FRANCISCO N. AGUILAR, widower; THELMA N. AGUILAR, single; EUSEBIO N. AGUILAR, JR.,
widower; RODOLFO N. AGUILAR, single and ANTONIO N. AGUILAR, married to Teresita Puig;
all of legal age, Filipinos.[28]
TCT No. 63767 was issued in the names of the five (5) respondents plus Virginia Aguilar,
thus:
FRANCISCO N. AGUILAR, widower; THELMA N. AGUILAR, single; EUSEBIO N. AGUILAR, JR.,
widower; RODOLFO N. AGUILAR, single and ANTONIO N. AGUILAR, married to Teresita Puig;
and VIRGINIA N. AGUILAR, single, all of legal age, Filipinos.[29]
Respondent Antonio Aguilar testified that he and the other registered owners are all siblings
who inherited the subject property by intestate succession from their parents. [30] Their father died
in 1945 and their mother in 1976.[31] Both TCTs were issued in the siblings names on September 2,
1987.[32] In 1986, however, the siblings agreed to extrajudicially partition the lots among
themselves, but no action was taken by them to this end. It was only eleven (11) years later, on
November 28, 1997 that a survey of the two lots was made[33] and on February 10, 1998, a
consolidation subdivision plan was approved by the Lands Management Service of the
Department of Environment and Natural Resources.[34] The co-owners signed a Partition
Agreement on February 24, 1998[35] and on May 21, 1998, TCT Nos. 63766 and 63767 were
cancelled and new titles issued in the names of the individual owners pursuant to the Partition
Agreement.
Petitioner argues that the consolidation of the subject lots and their partition was made more
than six (6) months after the complaint for expropriation was filed on August 4, 1997, hence, the
partition was made in bad faith, for the purpose of circumventing the provisions of R.A. 7279.[36]
At the time of filing of the complaint for expropriation, the lots subject of this case were owned
in common by respondents. Under a co-ownership, the ownership of an undivided thing or right
belongs to different persons.[37] During the existence of the co-ownership, no individual can claim
title to any definite portion of the community property until the partition thereof; and prior to the
partition, all that the co-owner has is an ideal or abstract quota or proportionate share in the entire
land or thing.[38] Article 493 of the Civil Code however provides that:
Art. 493. Each co-owner shall have the full ownership of his part and of the fruits and benefits
pertaining thereto, and he may therefore alienate, assign or mortgage it, and even substitute
another person in its enjoyment, except when personal rights are involved. But the effect of the
alienation or the mortgage, with respect to the co-owners shall be limited to the portion which may
be allotted to him in the division upon termination of the co-ownership.[39]
Before partition in a co-ownership, every co-owner has the absolute ownership of his undivided
interest in the common property. The co-owner is free to alienate, assign or mortgage his interest,
except as to purely personal rights.[40] He may also validly lease his undivided interest to a third
party independently of the other co-owners.[41] The effect of any such transfer is limited to the
portion which may be awarded to him upon the partition of the property.[42]
Article 493 therefore gives the owner of an undivided interest in the property the right to freely sell
and dispose of his undivided interest.[43] The co-owner, however, has no right to sell or alienate a
concrete specific or determinate part of the thing owned in common, because his right over the
thing is represented by a quota or ideal portion without any physical adjudication. [44] If the co-
owner sells a concrete portion, this, nonetheless, does not render the sale void. Such a sale
affects only his own share, subject to the results of the partition but not those of the other co-
owners who did not consent to the sale.[45]
In the instant case, the titles to the subject lots were issued in respondents names as co-
owners in 1987ten (10) years before the expropriation case was filed in 1997. As co-owners, all
that the respondents had was an ideal or abstract quota or proportionate share in the lots. This,
however, did not mean that they could not separately exercise any rights over the lots. Each
respondent had the full ownership of his undivided interest in the property. He could freely sell or
dispose of his interest independently of the other co-owners. And this interest could have even
been attached by his creditors.[46] The partition in 1998, six (6) months after the filing of the
expropriation case, terminated the co-ownership by converting into certain and definite parts the
respective undivided shares of the co-owners.[47] The subject property is not a thing essentially
indivisible. The rights of the co-owners to have the property partitioned and their share in the same
delivered to them cannot be questioned for "[n]o co-owner shall be obliged to remain in the co-
ownership."[48] The partition was merely a necessary incident of the co-ownership;[49] and absent
any evidence to the contrary, this partition is presumed to have been done in good faith.
Upon partition, four (4) co-owners, namely, Francisco, Thelma, Rodolfo and Antonio Aguilar
each had a share of 300 square meters under TCT Nos. 13849, 13852, 13850, 13851.[50] Eusebio
Aguilars share was 347 square meters under TCT No. 13853[51] while Virginia Aguilars was 89
square meters under TCT No. 13854.[52]
On the other hand, respondents claim that the subject lots are their only
real property[58] and that they, particularly two of the five heirs of Eusebio Aguilar, are
merely renting their houses and therefore do not own any other real property in Metro
Manila.[59] To prove this, they submitted certifications from the offices of the City and Municipal
Assessors in Metro Manila attesting to the fact that they have no registered real property declared
for taxation purposes in the respective cities. Respondents were certified by the City Assessor of
Manila;[60] Quezon City;[61] Makati City;[62] Pasay City;[63] Paranaque;[64]Caloocan City;[65] Pasig
City;[66] Muntinlupa;[67] Marikina;[68] and the then municipality of Las Pias[69] and the municipality of
San Juan del Monte[70] as having no real property registered for taxation in their individual names.
Finally, this court notes that the subject lots are now in the possession of
respondents. Antonio Aguilar testified that he and the other co-owners filed ejectment cases
against the occupants of the land before the Metropolitan Trial Court, Mandaluyong, Branches 59
and 60. Orders of eviction were issued and executed on September 17, 1997 which resulted in the
eviction of the tenants and other occupants from the land in question.[71]
IN VIEW WHEREOF, the petition is DENIED and the orders dated September 17, 1998 and
December 29, 1998 of the Regional Trial Court, Branch 168, Pasig City in SCA No. 1427 are
AFFIRMED.
SO ORDERED.
Davide, Jr., C.J., (Chairman), Kapunan, Pardo, and Ynares-Santiago, JJ., concur.

It is noted that Virginia Aguilar, although granted 89 square meters only of the subject lots, is,
at the same time, the sole registered owner of TCT No. 59780, one of the three (3)
titles initially sought to be expropriated in the original complaint. TCT No. 59780, with a land area
of 211 square meters, was dropped in the amended complaint. Eusebio Aguilar was granted 347
square meters, which is 47 square meters more than the maximum of 300 square meters set by
R.A. 7279 for small property owners. In TCT No. 13853, Eusebios title, however, appears the
following annotation:

subject to x x x, and to the prov. of Sec. 4 Rule 74 of the Rules of Court with respect to the
inheritance left by the deceased Eusebio N. Aguilar.[53]
Eusebio died on March 23, 1995,[54] and, according to Antonios testimony, the former was
survived by five (5) children.[55] Where there are several co-owners, and some of them die, the
heirs of those who die, with respect to that part belonging to the deceased, become also co-
owners of the property together with those who survive.[56] After Eusebio died, his five heirs
became co-owners of his 347 square-meter portion. Dividing the 347 square meters among the
five entitled each heir to 69.4 square meters of the land subject of litigation.
Consequently, the share of each co-owner did not exceed the 300 square meter limit set in
R.A. 7279. The second question, however, is whether the subject property is the only real property
of respondents for them to comply with the second requisite for small property owners.
Antonio Aguilar testified that he and most of the original co-owners do not reside on the
subject property but in their ancestral home in Paco, Manila.[57] Respondents therefore appear to
own real property other than the lots in litigation. Nonetheless, the records do not show that the
ancestral home in Paco, Manila and the land on which it stands are owned by respondents or any
one of them. Petitioner did not present any title or proof of this fact despite Antonio Aguilars
testimony.