FACTS:

The petitioner, Soledad Cañezo, filed a Complaint for the recovery of real property against her father's second wife, respondent Concepcion Rojas. The subject property is an unregistered land in Naval, Biliran. The petitioner alleges that she bought the land in 1939 from Crisogono Limpiado and entrusted it to her father, Crispulo Rojas, when she and her husband left for Mindanao in 1948. In 1980, she discovered that the respondent was in possession of the property and that the tax declaration was in Crispulo's name. The respondent claims that Crispulo bought the land in 1948 and possessed it until his death in 1978.

The Municipal Trial Court (MTC) ruled in favor of the petitioner, but the Regional Trial Court (RTC) initially reversed the decision but later amended it, declaring the petitioner as the true owner of the land.

The case involves a dispute over the ownership of a parcel of land. The plaintiff-appellee, Soledad Cañezo, filed a complaint for recovery of real property against the defendant-appellant, Concepcion Rojas. The Regional Trial Court (RTC) ruled in favor of Cañezo, ordering Rojas to pay Cañezo the sum of P34,000.00 in actual damages, as well as the loss of her share in the money value of the products of the coconut trees on the land. Rojas appealed the decision to the Court of Appeals (CA), which reversed the RTC’s decision due to laches, prescription, and lack of merit.

The CA found that Cañezo's inaction for several years casts doubt on her claim of ownership over the land. It also noted that during the probate proceedings, Cañezo did not contest the inclusion of the land in the estate of Crispulo Rojas, suggesting that Crispulo Rojas was the true owner of the property.

The CA held that even if there was an implied or resulting trust between Cañezo and Crispulo Rojas, her right to recover the property would still be barred by prescription. The CA denied Cañezo's motion for reconsideration, prompting her to file a petition for review before the Supreme Court.

Cañezo argues that the CA erred in granting an extension of time to file the petition and argues that prescription and laches do not apply because of the existence of a trust relationship.

Rojas argues that the petitioners are estopped from questioning the CA's resolution granting a second extension of time and argues that the complaint is barred by prescription, laches, and estoppel. Rojas also contends that the other co-owners should have been impleaded in the case.

The Supreme Court found no merit in the petition and upheld the CA's decision.

The petitioner argues that her right to recover the property cannot be barred by prescription or laches because there existed an express trust or a resulting trust between her and her father. The respondent, on the other hand, claims uninterrupted possession of the property for 49 years, starting in 1948.

The Court of Appeals (CA) granted a motion for extension filed by the respondent, which is being questioned by the petitioner.

ISSUES:

1. Whether the Court of Appeals erred in granting the second motion for extension of time to file the respondent's petition.

2. Whether the petitioner's right of action to recover the property is barred by prescription or laches.

3. Whether or not there was an intention to create a trust.

4. Whether or not a resulting trust was created.

5. Whether a constructive trust can be created over a property when one mistakenly retains property that rightfully belongs to another.

RULING:

1. The grant or denial of a motion for extension of time is within the sound discretion of the court. In this case, there is no showing that the Court of Appeals granted the motion for extension capriciously. Therefore, the Court finds no reversible error in the grant of the motion for extension of time.

2. The resolution of this issue depends on whether there exists a trust over the property between the petitioner and her father. A trust may be express or implied. Express trusts are created by direct and positive acts of the parties, while implied trusts are deducible from the nature of the transaction or operation of law. Implied trusts may be resulting trusts or constructive trusts. A trustee cannot acquire by prescription a property entrusted to him unless he repudiates the trust. However, in this case, the burden of proving the existence of a trust rests on the petitioner. The petitioner failed to prove the existence of an express trust between her and her father. The only evidence presented was the petitioner's self-serving testimony, which is not sufficient to establish an express trust. Therefore, the petitioner's right of action to recover the property is barred by prescription.

3. The Court ruled that there was no intention to create a trust. The petitioner's testimony and the circumstances surrounding the case were insufficient to establish the existence of a trust. The mere agreement of profit-sharing between parties does not necessarily create a trust.

4. The Court also ruled that there was no resulting trust. A resulting trust is presumed to have been contemplated by the parties, but in this case, there was no evidence of any transaction between the petitioner and her father that would indicate that a resulting trust was intended.

5. Yes, a constructive trust can be created over a property when one mistakenly retains property that rightfully belongs to another. A constructive trust is one created not by any word or phrase, either expressly or impliedly, evincing a direct intention to create a trust, but one which arises in order to satisfy the demands of justice. It does not come about by agreement or intention but in the main by operation of law, construed against one who, by fraud, duress or abuse of confidence, obtains or holds the legal right to property which he ought not, in equity and good conscience, to hold.

PRINCIPLES:

• The grant or denial of a motion for extension of time is within the sound discretion of the court.

• A trustee cannot acquire by prescription a property entrusted to him unless he repudiates the trust.

• The burden of proving the existence of a trust rests on the party asserting its existence and must be clear and satisfactorily proven.

• An intention to create a trust must be shown with reasonable certainty and cannot be inferred from vague or ambiguous declarations or circumstances susceptible to other interpretations.

• For a resulting trust to be established, the evidence must be trustworthy and convincing, as if the acts giving rise to the trust are proven by an authentic document.

• Continuous possession of a property, coupled with acts of ownership, can ripen into ownership through prescription, even without good faith and just title.

• A trust terminates upon the death of the trustee, especially if the trustor intended no other person to administer it.

• A constructive trust is created to satisfy the demands of justice and may arise in cases where one mistakenly retains property that rightfully belongs to another.

• Prescription may supervene in constructive implied trusts even if the trustee does not repudiate the relationship, unlike in express trusts and resulting implied trusts.

• In constructive implied trusts, there is neither a promise nor any fiduciary relation between the trustee and the beneficiary. The holding of a constructive trust is for the trustee, and therefore, at all times adverse.

• The petitioner is estopped from asserting ownership over the property due to her failure to protest its inclusion in the estate and her participation in the project of partition for 12 years.

• The action is barred by laches because the petitioner filed the action to recover the property 17 years after allegedly discovering the respondent's possession of the property.

• Owners of property over which reconveyance is asserted are indispensable parties in an action for reconveyance. Without them being impleaded, no relief is available, and the court cannot render a valid judgment.