THIRD DIVISION
G.R. No. 148775 January 13, 2004SHOPPER’S PARADISE REALTY & DEVELOPMENT CORPORATION, petitioner,
vs.
EFREN P. ROQUE, respondent.
D E C I S I O N
VITUG, J.:
On 23 December 1993, petitioner Shopper’s Paradise
Realty & Development Corporation, represented by its president,
Veredigno Atienza, entered into a twenty-five year lease with Dr. Felipe
C. Roque, now deceased, over a parcel of land, with an area of two
thousand and thirty six (2,036) square meters, situated at Plaza
Novaliches, Quezon City, covered by Transfer of Certificate of Title
(TCT) No. 30591 of the Register of Deeds of Quezon City in the name of
Dr. Roque. Petitioner issued to Dr. Roque a check for P250,000.00 by way
of "reservation payment." Simultaneously, petitioner and Dr. Roque
likewise entered into a memorandum of agreement for the construction,
development and operation of a commercial building complex on the
property. Conformably with the agreement, petitioner issued a check for
another P250,000.00 "downpayment" to Dr. Roque.
The contract of lease and the memorandum of
agreement, both notarized, were to be annotated on TCT No. 30591 within
sixty (60) days from 23 December 1993 or until 23 February 1994. The
annotations, however, were never made because of the untimely demise of
Dr. Felipe C. Roque. The death of Dr. Roque on 10 February 1994
constrained petitioner to deal with respondent Efren P. Roque, one of
the surviving children of the late Dr. Roque, but the negotiations broke
down due to some disagreements. In a letter, dated 3 November 1994,
respondent advised petitioner "to desist from any attempt to enforce the
aforementioned contract of lease and memorandum of agreement". On 15
February 1995, respondent filed a case for annulment of the contract of
lease and the memorandum of agreement, with a prayer for the issuance of
a preliminary injunction, before Branch 222 of the Regional Trial Court
of Quezon City. Efren P. Roque alleged that he had long been the
absolute owner of the subject property by virtue of a deed of donation
inter vivos executed in his favor by his parents, Dr. Felipe Roque and
Elisa Roque, on 26 December 1978, and that the late Dr. Felipe Roque had
no authority to enter into the assailed agreements with petitioner. The
donation was made in a public instrument duly acknowledged by the
donor-spouses before a notary public and duly accepted on the same day
by respondent before the notary public in the same instrument of
donation. The title to the property, however, remained in the name of
Dr. Felipe C. Roque, and it was only transferred to and in the name of
respondent sixteen years later, or on 11 May 1994, under TCT No. 109754
of the Register of Deeds of Quezon City. Respondent, while he resided in
the United States of America, delegated to his father the mere
administration of the property. Respondent came to know of the assailed
contracts with petitioner only after retiring to the Philippines upon
the death of his father.
On 9 August 1996, the trial court dismissed the complaint of respondent; it explained:
"Ordinarily, a deed of donation need not be
registered in order to be valid between the parties. Registration,
however, is important in binding third persons. Thus, when Felipe Roque
entered into a leased contract with defendant corporation, plaintiff
Efren Roque (could) no longer assert the unregistered deed of donation
and say that his father, Felipe, was no longer the owner of the subject
property at the time the lease on the subject property was agreed upon.
"The registration of the Deed of Donation after the
execution of the lease contract did not affect the latter unless he had
knowledge thereof at the time of the registration which plaintiff had
not been able to establish. Plaintiff knew very well of the existence of
the lease. He, in fact, met with the officers of the defendant
corporation at least once before he caused the registration of the deed
of donation in his favor and although the lease itself was not
registered, it remains valid considering that no third person is
involved. Plaintiff cannot be the third person because he is the
successor-in-interest of his father, Felipe Roque, the lessor, and it is
a rule that contracts take effect not only between the parties
themselves but also between their assigns and heirs (Article 1311, Civil
Code) and therefore, the lease contract together with the memorandum of
agreement would be conclusive on plaintiff Efren Roque. He is bound by
the contract even if he did not participate therein. Moreover, the
agreements have been perfected and partially executed by the receipt of
his father of the downpayment and deposit totaling to P500,000.00."1
The Trial court ordered respondent to surrender TCT
No. 109754 to the Register of Deeds of Quezon City for the annotation of
the questioned Contract of Lease and Memorandum of Agreement.
On appeal, the Court of Appeals reversed the decision
of the trial court and held to be invalid the Contract of Lease and
Memorandum of Agreement. While it shared the view expressed by the trial
court that a deed of donation would have to be registered in order to
bind third persons, the appellate court, however, concluded that
petitioner was not a lessee in good faith having had prior knowledge of
the donation in favor of respondent, and that such actual knowledge had
the effect of registration insofar as petitioner was concerned. The
appellate court based its findings largely on the testimony of Veredigno
Atienza during cross-examination, viz;
"Q. Aside from these two lots, the first in the name
of Ruben Roque and the second, the subject of the construction involved
in this case, you said there is another lot which was part of
development project?
"A. Yes, this was the main concept of Dr. Roque so
that the adjoining properties of his two sons, Ruben and Cesar, will
comprise one whole. The other whole property belongs to Cesar.
"Q. You were informed by Dr. Roque that this property
was given to his three (3) sons; one to Ruben Roque, the other to
Efren, and the other to Cesar Roque?
"A. Yes."Q. You did the inquiry from him, how was this property given to them?
"A. By inheritance.
"Q. Inheritance in the form of donation?
"A. I mean inheritance.
"Q. What I am only asking you is, were you told by
Dr. Felipe C. Roque at the time of your transaction with him that all
these three properties were given to his children by way of donation?
"A. What Architect Biglang-awa told us in his exact word: "Yang
mga yan pupunta sa mga anak. Yong kay Ruben pupunta kay Ruben. Yong kay
Efren palibhasa nasa America sya, nasa pangalan pa ni Dr. Felipe C.
Roque."
"x x x x x x x x x
"Q. When was the information supplied to you by
Biglang-awa? Before the execution of the Contract of Lease and
Memorandum of Agreement?
"A. Yes.
"Q. That being the case, at the time of the execution
of the agreement or soon before, did you have such information
confirmed by Dr. Felipe C. Roque himself?
"A. Biglang-awa did it for us."Q. But you yourself did not?
"A. No, because I was doing certain things. We were a team and so Biglang-awa did it for us.
"Q. So in effect, any information gathered by
Biglang-awa was of the same effect as if received by you because you
were members of the same team?
"A. Yes."2
In the instant petition for review, petitioner seeks a
reversal of the decision of the Court of Appeals and the reinstatement
of the ruling of the Regional Trial Court; it argues that the
presumption of good faith it so enjoys as a party dealing in registered
land has not been overturned by the aforequoted testimonial evidence,
and that, in any event, respondent is barred by laches and estoppel from
denying the contracts.
The existence, albeit unregistered, of the donation
in favor of respondent is undisputed. The trial court and the appellate
court have not erred in holding that the non-registration of a deed of
donation does not affect its validity. As being itself a mode of
acquiring ownership, donation results in an effective transfer of title
over the property from the donor to the donee.3 In donations
of immovable property, the law requires for its validity that it should
be contained in a public document, specifying therein the property
donated and the value of the charges which the donee must satisfy.4
The Civil Code provides, however, that "titles of ownership, or other
rights over immovable property, which are not duly inscribed or
annotated in the Registry of Property (now Registry of Land Titles and
Deeds) shall not prejudice third persons."5 It is enough,
between the parties to a donation of an immovable property, that the
donation be made in a public document but, in order to bind third
persons, the donation must be registered in the registry of Property
(Registry of Land Titles and Deeds).6 Consistently, Section
50 of Act No. 496 (Land Registration Act), as so amended by Section 51
of P.D. No. 1529 (Property Registration Decree), states:
"SECTION 51. Conveyance and other dealings by registered owner.-
An owner of registered land may convey, mortgage, lease, charge or
otherwise deal with the same in accordance with existing laws. He may
use such forms of deeds, mortgages, leases or other voluntary
instruments as are sufficient in law. But no deed, mortgage, lease, or
other voluntary instrument, except a will purporting to convey or affect
registered land shall take effect as a conveyance or bind the land, but
shall operate only as a contract between the parties and as evidence of
authority to the Register of Deeds to make registration.
"The act of registration shall be the operative act to convey or affect the land insofar as third persons are concerned, and
in all cases under this Decree, the registration shall be made in the
office of the Register of Deeds for the province or city where the land
lies." (emphasis supplied)
A person dealing with registered land may thus safely
rely on the correctness of the certificate of title issued therefore,
and he is not required to go beyond the certificate to determine the
condition of the property7 but, where such party has
knowledge of a prior existing interest which is unregistered at the time
he acquired a right thereto, his knowledge of that prior unregistered
interest would have the effect of registration as regards to him.8
The appellate court was not without substantial basis
when it found petitioner to have had knowledge of the donation at the
time it entered into the two agreements with Dr. Roque. During their
negotiation, petitioner, through its representatives, was apprised of
the fact that the subject property actually belonged to respondent.
It was not shown that Dr. Felipe C. Roque had been an authorized agent of respondent.
In a contract of agency, the agent acts in representation or in behalf of another with the consent of the latter.9
Article 1878 of the Civil Code expresses that a special power of
attorney is necessary to lease any real property to another person for
more than one year. The lease of real property for more than one year is
considered not merely an act of administration but an act of strict
dominion or of ownership. A special power of attorney is thus necessary
for its execution through an agent.1awphil.ne+
The Court cannot accept petitioner’s argument that
respondent is guilty of laches. Laches, in its real sense, is the
failure or neglect, for an unreasonable and unexplained length of time,
to do that which, by exercising due diligence, could or should have been
done earlier; it is negligence or omission to assert a right within a
reasonable time, warranting a presumption that the party entitled to
assert it either has abandoned or declined to assert it.10
Respondent learned of the contracts only in February
1994 after the death of his father, and in the same year, during
November, he assailed the validity of the agreements. Hardly, could
respondent then be said to have neglected to assert his case for
unreasonable length of time.
Neither is respondent estopped from repudiating the
contracts. The essential elements of estoppel in pais, in relation to
the party sought to be estopped, are:
1) a clear conduct amounting to
false representation or concealment of material facts or, at least,
calculated to convey the impression that the facts are otherwise than,
and inconsistent with, those which the party subsequently attempts to
assert;
2) an intent or, at least, an expectation, that this conduct
shall influence, or be acted upon by, the other party; and 3) the
knowledge, actual or constructive, by him of the real facts.11
With respect to the party claiming the estoppel, the conditions he must
satisfy are:
1) lack of knowledge or of the means of knowledge of the
truth as to the facts in question;
2) reliance, in good faith, upon the
conduct or statements of the party to be estopped; and
3) action or
inaction based thereon of such character as to change his position or
status calculated to cause him injury or prejudice.12
It has
not been shown that respondent intended to conceal the actual facts
concerning the property; more importantly, petitioner has been shown not
to be totally unaware of the real ownership of the subject property.
Altogether, there is no cogent reason to reverse the Court of Appeals in its assailed decision.
WHEREFORE, the petition is DENIED, and the decision
of the Court of Appeals declaring the contract of lease and memorandum
of agreement entered into between Dr. Felipe C. Roque and Shopper’s
Paradise Realty & Development Corporation not to be binding on
respondent is AFFIRMED. No costs.
SO ORDERED.Sandoval-Gutierrez, Corona, and Carpio-Morales, JJ., concur.
Footnotes
1 Rollo, p. 37.
2 Rollo, pp. 40-41.
3 Article 712, New Civil Code.
4 Article 749, New Civil Code.
5 Article 709, New Civil Code.
6 See Gonzales v. Court of Appeals, G.R. No. 110335, 18 June 2001, 358 SCRA 598.
7 Santos v. Court of Appeals, G.R. No. 90380, 13 September 1990, 189 SCRA 550.
8 Lagandaon v. Court of Appeals, G.R. No.
102526-31, 21 May 1998, 290 SCRA 330; Fernandez v. Court of Appeals,
G.R. No. 83141, 21 September 1990, 189 SCRA 780.
9 Article 1868, New Civil Code.10 Tolentino, Civil Code of the Philippines, vol. IV, 1990-1991, p. 661.
11 Kalalo v. Luz, G.R. No. L-27782, 31 July 1970, 34 SCRA 337.
12 Id.
No comments:
Post a Comment