No prescriptive period

When parcels of land have been acquired through fraud, an action for re-conveyance may be filed within four (4) years from discovery of fraud. If an implied or constructive trust is created by such acquisition, the action prescribes in ten (10) years. But is there an instance when the action for re-conveyance will not prescribe? This is answered in this case between Ester and her nephew Pete, a lawyer,

The case involved three parcels of land: lots 3244 and 1404 covered by Original Certificate of Title (OCT) Nos. 484 and 1482 respectively, registered in the names of the children and heirs of Matilde, namely, Mila, Juan, Tino and Ipe at 1/4 undivided share each; and lot 3246 covered by OCT No. 368 registered collectively in the name of the “Heirs of Matilde”.

Mila, Juan, Tino and Ipe had all died. Surviving them are their children and descendants particularly the protagonists in this case, Ester and Pete who are the daughter and grandson of Juan.

Since 1965, Ester had occupied lot 1404 where she built her house and was collecting the rentals from the tenants of lots 3244 and 3246. To further protect her rights and interest on the three lots as heir of her father Juan, she registered her adverse claims on the titles to the lots although said claim was annotated only on the titles to lots 3244 and 1404.

Ester continued in possession of the properties although in 1983, Pete tried to prohibit her from collecting the rentals from the tenants of lots 3244 and 3246. Then in December, 1983, he filed a suit for recovery of possession of said lots from Ester and another suit for unlawful detainer of lot 1404 where Ester was staying. While the lower courts ruled in favor of Pete, the Court of Appeals reversed the RTC decision and ruled in favor of Ester. Hence, Pete never took possession of the properties.

In 1988, upon verification from the Register of Deeds, Ester discovered that Pete had already executed an “Affidavit of Adjudication” way back on April 17, 1974 wherein he declared that he was the sole surviving heir of the registered owners of the three lots and thus he adjudicated them unto himself. Based on this Affidavit of Adjudication, Pete was able to obtain title to the lots. Then on May 10, 1974, the same day he obtained titles to lots 3244 and 1404, he sold them to Cario so a new title was issued in the name of Cario. Again on March 30, 1979 or two days after he obtained title to lot 3246, Pete also sold the same to Tony. On the same day, Cario also sold to Tony lots 3244 and 1404. Subsequently however, Tony sold back to Pete all the three lots.

So on October 2, 1990, Ester filed a complaint before the RTC against her nephew Pete for re-conveyance of the titles to the lots and for damages. She claimed that the Affidavit of Adjudication was null and void ab initio because of the untruthful statements therein knowingly and willfully made by Pete who knew that there were still other living heirs entitled to the said properties. If at all, Ester alleged that Pete was holding the titles as trustee in an implied or constructive trust. So Ester asked that the titles be reverted back to its original registered owners: lots 3244 and 1404 in the names of Mila, Juan, Tino and Ipe, pro indiviso and lot 3246 in the name of the “heirs of Matilde”.

After trial, the RTC ruled in favor of Pete on the ground that when the complaint was filed on October 2, 1990 prescription has already set in. The RTC, as affirmed subsequently by the Court of Appeals, (CA) declared that when an action for re-conveyance is based on fraud , it must be filed within 4 years from discovery of fraud, and such discovery is deemed to have taken place when the affidavit of adjudication was registered and the titles were issued in the name of Pete on May 10, 1974. On the other hand an action for re-conveyance based on implied or constructive trust prescribes in 10 years from such date. In this case some 16 years have already passed since the Affidavit of Adjudication was registered with the register of deeds on May 10, 1974. So the action has already prescribed. Were the RTC and the CA correct?

No. The action for re-conveyance can indeed be barred by prescription in 4 years or 10 years as the case may be. But when the plaintiff (Ester, in this case) is still in actual possession of the disputed lands, the period of prescription does not run. The action for re-conveyance here becomes in effect an action to quiet title, which is not subject to prescription.

One who is in possession of a piece of land claiming to be the owner thereof may wait until his possession is disturbed or his title is attacked before taking steps to vindicate his right, the reason for the rule being, that his undisturbed possession gives him the right to seek the aid of the court of equity at any time, to determine the nature of the claim of a another party and its effect on his own title, which right can be claimed only by one who is in possession.

In this case Ester’s possession was disturbed in 1983 when Pete filed a case for recovery of possession and a case for unlawful detainer. But Ester never lost possession because the court eventually ruled in her favor on said cases. As such she is in a position to file this action to protect her rights and clear whatever doubts have been cast on her title by the issuance of the TCTs in Pete’s name (Yared etc, vs. Tiongco and Doronila, Jr. G.R. 161360, October 14, 2011)

Note: Books containing compilation of my articles on Labor Law and Criminal Law (Vols. I and II) are now available. Call Tel. 7249445.

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