FELICIANO ESGUERRA v. VIRGINIA TRINIDAD

FACTS:

The Esguerra spouses owned two parcels of land in Bulacan. They sold half of a 35,284-square meter parcel to their grandchildren and a portion of a 23,989-square meter parcel to their other grandchildren, the Trinidad brothers. Deeds of Sale were executed for both transactions. Later, Eulalio Trinidad sold his share of the land to his daughters, the respondents. The respondents applied for registration of title and were awarded Lot No. 3593, with OCT No. 0-3631 in their favor.

The Esguerra spouses also sold a portion of the land to the Trinidad spouses. However, during a cadastral survey, it was discovered that the portion sold to the Trinidad spouses was larger than stated in the deed of sale.

Eulalio Trinidad applied for registration of title over Lot No. 3591 and was awarded the land. Upon the deaths of the Trinidad spouses, Lot No. 3591 was transmitted to the respondents.

The petitioners filed separate complaints seeking the nullification of OCT No. 0-3631 and OCT No. 0-6498, alleging fraud and misrepresentation. The trial court dismissed the complaints and this decision was affirmed by the Court of Appeals. The petitioners appealed the decision to the Supreme Court.

ISSUES:

  1. Whether the appellees' acquisition of the certificate of title is fraudulent.

  2. Whether the interpretation and application of Article 1542 of the Civil Code by the appellate court is correct.

  3. Whether the sale of the "bahaging palayan" includes the entire land within the boundaries or only a specific portion of it.

  4. Whether the increase of a fourth of a fraction in the area indicated in the deed of sale can be considered as an unreasonable excess.

RULING:

  1. The Court ruled that the appellees' acquisition of the certificate of title is not fraudulent. The factual findings of the trial court, affirmed by the Court of Appeals, are final and binding on the Court. The appellants failed to establish clear and convincing proof of fraud in the acquisition of the certificate of title.

  2. The Court upheld the interpretation and application of Article 1542 of the Civil Code by the appellate court. In this case, the sale of the land was characterized as a lump sum contract, and the specific boundaries stated in the contract prevail over any statement with respect to the area. The obligation of the vendor is to deliver everything within the boundaries, regardless of the exact area specified in the contract.

  3. The sale of the "bahaging palayan" includes the entire land within the boundaries, regardless of whether the real area is greater or smaller than that recited in the deed. The use of "more or less" in the description of quantity covers only a reasonable excess or deficiency. The vendee of land sold in gross with the description "more or less" does not take all the risk of quantity in the land.

  4. In this case, the increase of a fourth of a fraction in the area indicated in the deed of sale is not considered an unreasonable excess. The circumstances surrounding the inclusion of the excess area do not hint at unreasonableness, and the land was not yet technically surveyed at the time of the sale.

PRINCIPLES:

  • Factual findings of the trial court, when affirmed by the Court of Appeals, are final, conclusive, and binding.

  • Under the Torrens System, an Original Certificate of Title (OCT) enjoys a presumption of validity, and fraud must be supported by clear and convincing proof.

  • In sales involving real estate, parties may choose between a unit price contract and a lump sum contract.

  • In a unit price contract, the area of the immovable is not conclusive, and the price may be reduced or increased depending on the area actually delivered.

  • In a lump sum contract, there shall be no increase or decrease in the price, even if the actual area differs from the area stated in the contract.

  • When both the area and boundaries of the immovable are declared, the boundaries prevail over the area. The specific boundaries stated in the contract control over any statement regarding the area.

  • Under Article 1542, what is controlling in the sale of land is the entire land included within the boundaries, regardless of the specific measurement indicated in the deed of sale.

  • The use of "more or less" in the description of quantity covers only a reasonable excess or deficiency.

  • The prescriptive period of one year applies to actions for the cancellation of titles based on fraud.

  • Failure to comply with the requirement of barangay conciliation does not prevent a court of competent jurisdiction from adjudicating a case unless the objection is timely raised by the defendants.

  • A certificate of title serves as evidence of an indefeasible and incontrovertible title to the property after the lapse or expiration of one year from the date of entry of the decree of registration.