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MANUEL O. FUENTES v. CONRADO G. ROCA

FACTS:

Sabina Tarroza owned a titled lot in Zamboanga City. She sold it to her son, Tarciano Roca, under a deed of absolute sale in 1982. In 1988, Tarciano offered to sell the lot to Manuel and Leticia Fuentes. They signed an agreement to sell that would take effect in six months. The agreement required Tarciano to secure the consent of his estranged wife, Rosario Gabriel Roca, to the sale. The Fuentes spouses paid a down payment to Tarciano and upon his compliance with the conditions, they would take possession of the lot and pay the remaining amount. A new title was issued in the name of the Fuentes spouses, and they built a building on the lot. Tarciano and Rosario passed away in 1990. In 1997, the children of Tarciano and Rosario filed an action for annulment of sale and reconveyance of the land against the Fuentes spouses. They claimed that Rosario did not give her consent to the sale. The Fuentes spouses denied the allegations and argued that the action had already prescribed. The RTC dismissed the case, ruling that it had prescribed and that the Rocas failed to present clear and convincing evidence of fraud. The CA reversed the decision and concluded that there was sufficient evidence of forgery. The CA held that the action fell within the 10-year period for a wife to bring an action for annulment of sale on the ground of lack of spousal consent. The CA annulled the sale and ordered reimbursement and payment for improvements. The Fuentes spouses appealed to the Supreme Court.

ISSUES:

    • Whether or not Rosario's signature on the document of consent had been forged.

  2. Whether the action to annul the sale and reconvey the property filed by Rocas, the heirs of the wife whose written consent was not obtained, has already prescribed.

  3. Whether the right to bring an action to declare the sale void is forever lost upon the death of the wife.

  4. Whether the deed of sale executed by Tarciano Roca in favor of the Fuentes spouses and the subsequent issuance of the Transfer Certificate of Title in their names are valid.

  5. Whether the Fuentes spouses are entitled to the payment of the amount they gave to Tarciano Roca.

  6. Whether the Rocas are obligated to indemnify the Fuentes spouses for the expenses they incurred for improving the land, or pay the increase in value of the property.

RULING:

    • The Court agrees with the Court of Appeals' (CA) finding that Rosario's signature had been forged. The variance between her signature on the affidavit of consent and her specimen signatures was significant. The CA also took into account the falsified jurat of the affidavit of consent, which declared that Rosario signed it in Zamboanga City on January 11, 1989, whereas Atty. Plagata testified that she signed it earlier in Manila on September 15, 1988. The Court ruled that the forged signature and the falsified jurat rendered the document as proof of Rosario's consent to be void.

  2. The action to annul the sale and reconvey the property has not yet prescribed. Even if the sale is void from the beginning, when any of its terms have been performed, an action to declare its inexistence is necessary to allow restitution of what has been given under the contract. The action to declare the inexistence of a contract, including a void contract, does not prescribe under Article 1410 of the Civil Code. Therefore, the passage of time did not erode Rocas' right to bring the action.

  3. The right to have the sale declared void is not forever lost upon the death of the wife. The sale was void from the beginning, and consequently, the land remained the property of the spouses despite the sale. Upon their death, the ownership of the property passed on to their lawful heirs, namely, the Rocas. As lawful owners, the Rocas had the right to exclude any person from the enjoyment and disposal of the property under Article 429 of the Civil Code.

  4. The deed of sale executed by Tarciano Roca in favor of the Fuentes spouses and the subsequent issuance of the Transfer Certificate of Title are declared void.

  5. The Fuentes spouses are entitled to the payment of the amount they gave to Tarciano Roca, with legal interest, to be charged against his estate.

  6. The Rocas are ordered, at their option, to indemnify the Fuentes spouses for the expenses incurred for improving the land or pay the increase in value of the property.

PRINCIPLES:

  • Forged signatures can render a document void.

  • Falsifying a jurat of a document can strip it of its public character and reduce it to a private instrument.

  • In cases of sale of conjugal property, the consent of both spouses is required.

  • The Family Code supersedes the Civil Code in cases concerning conjugal property.

  • A void contract is equivalent to nothing and is absolutely wanting in civil effects. It cannot be validated either by ratification or prescription.

  • The action or defense for the declaration of the inexistence of a contract does not prescribe.

  • The right to have a sale declared void is not forever lost upon the death of the spouse whose consent was not obtained.

  • The owner of the land on which anything has been built, sown, or planted in good faith has the right to appropriate the works, sowing, or planting after payment of the indemnity and has the right of retention until reimbursement is made.

  • Article 546 of the Civil Code grants the person who introduced improvements on the land owned by another party the right to reimbursement or payment of the increase in value of the property.

  • Article 548 of the Civil Code provides that if the person who introduced improvements on the land does not choose to appropriate the property after indemnity, the parties must agree on the terms of lease, and in case of disagreement, the court shall fix the terms thereof.