Clemente vs. Republic of the Philippines

A donation subject to a resolutory condition—where ownership transfers immediately but is extinguished upon non-fulfillment of a condition—may be revoked by the donor or heirs when the donee fails to comply with the condition within a reasonable time; where no period is fixed for compliance but over fifty years have elapsed without fulfillment, the court need not fix a period under Article 1197 of the Civil Code before granting revocation, and the action is not barred by prescription or laches.

Municipal Mayor Amado A. Clemente, Dr. Vicente A. Clemente, Judge Ramon A. Clemente, and Milagros A. Clemente (Clemente Siblings) owned a parcel of land covered by Transfer Certificate of Title (TCT) No. T-50896. On March 16, 1963, they executed a Deed of Donation conveying a one-hectare portion to the Republic of the Philippines for the specific purpose of constructing a government hospital, with the condition that the property be used "solely for hospital site only and for no other else." The DPWH accepted the donation, and on March 29, 1963, TCT No. T-51745 was issued in the name of the Province of Quezon. Construction of the hospital began the following year but was never completed, leaving only the foundation. In 2003, Socorro T. Clemente, heir of Mayor Clemente, inquired about the hospital's status and was informed that the DPWH had no plans or budget for its construction. Consequently, in 2004, Socorro filed a complaint for revocation of donation, reconveyance, and recovery of possession, alleging breach of the donation's condition.

• On March 16, 1963, the Clemente Siblings executed a Deed of Donation conveying a one-hectare portion of their property to the Republic of the Philippines, specifically for use as a hospital site where a government hospital would be constructed.
• The Deed of Donation stated the donation was "unconditional" but contained the provision that the property was donated "solely for hospital site only and for no other else, where a Government Hospital shall be constructed."
• District Engineer Ciceron A. Guerrero of DPWH Region IV-A accepted the donation in the same instrument.
• On March 29, 1963, TCT No. T-50896 was partially cancelled and TCT No. T-51745 was issued in the name of the Province of Quezon covering the donated portion.
• Construction of the hospital building began in 1964 but was never completed; only the foundation remains, which has been cannibalized by local residents.
• In August and November 2003, Socorro T. Clemente, as heir of Mayor Clemente, wrote to the DPWH District Engineer inquiring about the hospital construction and was informed that the DPWH had no plans or budget for the project.
• In 2004, forty-one years after the donation, Socorro filed the complaint for revocation, alleging the donee failed to comply with the condition to construct and operate a government hospital.
• A government hospital was subsequently built in Barangay Polo, not on the subject property.

• The donation is an onerous donation governed by the law on obligations and contracts under Article 733 of the Civil Code, not by the law on donations, because it imposed the burden of constructing a hospital.
• Settlement of the estate or judicial determination of heirs is not a prerequisite for filing an action for revocation, as Article 487 of the Civil Code allows any co-owner to bring an action for recovery of possession for the benefit of all co-owners without joining all of them.
• The action is not premature because the donee's failure to construct the hospital for over fifty years constitutes breach of the resolutory condition, and the donee has manifestly abandoned the obligation.
• The action has not prescribed because the Deed of Donation fixed no period for compliance, making it impossible to determine when the cause of action accrued; the four-year period under Article 764 or the ten-year period under Article 1144 has not begun to run.
• Laches has not set in because the delay was not unreasonable on the part of the donor, whereas the donee unreasonably delayed compliance for over fifty years.

• The obligation to construct a hospital was fulfilled when the government started construction, and the mere existence of the foundation suffices to comply with the condition.
• The action is premature because Article 1197 requires the court to first fix a period for compliance before a breach can be declared.
• The action has prescribed because more than ten years have elapsed since the alleged violation of the condition, or alternatively, the four-year period under Article 764 has lapsed.
• Laches bars the action due to the unreasonable delay of over forty years in asserting the right to revoke.
• Socorro, as heir of a deceased co-donor, lacks legal capacity to sue because there has been no settlement of the estate or judicial determination of heirs, and she cannot represent the other co-heirs without such settlement.

• Procedural:
  • Whether a settlement of estate or judicial determination of heirs is required before an heir of a co-donor may file an action for revocation of donation intended to benefit all co-heirs.
  • Whether the failure of other co-heirs to join the petitioner is a ground for dismissal of the action.
• Substantive Issues:
  • Whether the donation is revocable due to the donee's failure to comply with the condition to construct a government hospital.
  • Whether the donation is properly classified as a donation subject to a resolutory condition or an onerous donation.
  • Whether the action for revocation is premature in light of Article 1197 of the Civil Code.
  • Whether the action is barred by prescription or laches.

• Procedural:
  • The Court held that no settlement of estate is required before an heir may file an action for revocation of donation on behalf of the co-ownership. Under Article 487 of the Civil Code, any co-owner may bring an action for ejectment or recovery of possession without joining all other co-owners if the suit is for the benefit of all. Article 493 grants heirs the right to exercise acts of ownership over their share even before settlement, provided they recognize the co-ownership.
  • The Court ruled that since Socorro acknowledged her co-heirs as co-owners and prayed for the title to be issued to all heirs pro indiviso, she was suing for the benefit of the co-ownership, and the other co-heirs were not indispensable parties.
• Substantive:
  • The Court ruled that the donation was subject to a resolutory condition under Article 764 of the Civil Code. The condition had two parts: (1) construction of a government hospital, and (2) use of the property solely as a hospital site. The donee failed to comply with both, as only an unfinished foundation existed and the property was left idle.
  • The Court held that the action was not premature. While Article 1197 allows courts to fix a period when one was intended but not fixed, this procedure is unnecessary when it would be a mere technicality. Having allowed more than fifty years for compliance, the reasonable time contemplated by the parties had already lapsed, and the donee had manifestly abandoned the project by building a hospital elsewhere.
  • The Court held that prescription had not set in because the Deed of Donation fixed no period for compliance, making it impossible to determine with certainty when the failure to comply occurred and when the prescriptive period began to run.
  • The Court held that laches did not apply because there was no unreasonable delay on the donor's part in asserting the right, given the uncertainty of the compliance period; rather, the donee was guilty of unreasonable delay and neglect.

• Donation Subject to a Resolutory Condition — A donation where the acquisition of rights is demandable at once but the non-fulfillment of a condition gives the donor the right to revoke and causes the extinguishment of rights acquired. The Court applied this to hold that the transfer of title to the donee was valid but subject to revocation upon failure to construct the hospital.
• Onerous Donation — A donation subject to burdens, charges, or future services equal or greater in value than the thing donated, governed by the rules on contracts and obligations under Article 733 of the Civil Code. Justice Caguioa invoked this doctrine to argue that the donation was not conditional but onerous, subject to resolution under Article 1191.
• Action by a Co-Owner for the Benefit of All — Under Article 487 of the Civil Code, any co-owner may bring an action for ejectment (covering accion interdictal, accion publiciana, and accion reivindicatoria) without joining all other co-owners as plaintiffs, because the suit is deemed instituted for the benefit of all, provided the plaintiff recognizes the co-ownership.
• Fixing of Period Under Article 1197 — When an obligation does not fix a period but one was intended, courts may fix the duration; however, this is not required when such procedure would be a mere technicality and formality serving only to delay, such as when over fifty years have already been allowed for compliance.
• Laches — The failure or neglect for an unreasonable and unexplained length of time to do that which could have been done earlier, warranting a presumption of abandonment of the right. The Court held laches inapplicable where the period for compliance was uncertain and the donee, not the donor, was responsible for the delay.

• "The condition imposed upon the donee has two parts – first, to construct a government hospital, and second, to use the Subject Property solely as a hospital site."
• "A foundation of a building is obviously not a government hospital."
• "There is no more need to fix the duration of a term of the obligation when such procedure would be a mere technicality and formality and would serve no purpose than to delay or lead to an unnecessary and expensive multiplication of suits."
• "It has now become evident that the donee will no longer comply with the condition to construct a hospital because a government hospital was already built in another barangay..."
• "Laches is evidentiary in nature which could not be established by mere allegations in the pleadings and can not be resolved in a motion to dismiss."

• Central Philippine University v. Court of Appeals, 316 Phil. 616 (1995) — Cited as controlling precedent holding that when more than a reasonable period (fifty years) has been allowed for compliance with a condition, there is no need to fix a period under Article 1197 before granting rescission.
• Spouses Mendoza v. Coronel, 517 Phil. 549 (2006) — Cited for the rule that a co-owner may bring an action for ejectment without joining all other co-owners because the suit is deemed for the benefit of all.
• Catedrilla v. Lauron, 709 Phil. 335 (2013) — Followed for the interpretation of Article 487 allowing co-owners to sue for recovery of possession without impleading all co-owners.
• Carandang v. Heirs of De Guzman — Cited to establish that co-owners are not even necessary parties in suits for recovery of co-owned properties, as complete relief can be afforded in their absence.
• De Luna v. Judge Abrigo, 260 Phil. 157 (1990) — Cited in the concurring opinion for the definition and classification of onerous donations.
• Department of Education, Division of Albay v. Oñate, 551 Phil. 633 (2007) — Cited for the elements of laches and the rule that it cannot be established by mere allegations.

• Article 487 of the Civil Code — Allows any co-owner to bring an action in ejectment covering all kinds of actions for recovery of possession for the benefit of all co-owners.
• Article 493 of the Civil Code — Grants co-owners full ownership of their part and the right to exercise acts of ownership, including alienation, even before settlement of the estate.
• Article 733 of the Civil Code — Provides that donations with an onerous cause shall be governed by the rules on contracts.
• Article 764 of the Civil Code — Allows revocation of donation when the donee fails to comply with conditions imposed; action prescribes after four years from non-compliance.
• Article 1144 of the Civil Code — Prescriptive period for actions based on written contracts (ten years), cited in the concurring opinion as applicable to onerous donations.
• Article 1179 of the Civil Code — Defines conditional obligations as those where the acquisition or extinguishment of rights depends upon a future and uncertain event.
• Article 1184 of the Civil Code — Provides that a condition that an event happen at a determinate time extinguishes the obligation when the time expires or if it becomes indubitable the event will not take place.
• Article 1191 of the Civil Code — Grants the power to rescind reciprocal obligations when one obligor fails to comply, unless there is just cause to fix a period.
• Article 1197 of the Civil Code — Authorizes courts to fix the duration of a period when the obligation does not fix one but a period was intended.

• Justice Alfredo Benjamin S. Caguioa — Concurred in the result but disagreed with the classification of the donation as subject to a resolutory condition. He argued that the donation was expressly "unconditional" and should be classified as an onerous donation governed by Article 733, imposing a mode/burden (hospital construction) equal to the value of the land. He contended that Article 1197 applies to obligations with a period, not conditional obligations, and that the ten-year prescriptive period under Article 1144(1) should apply rather than Article 764. He agreed that the action was not barred by laches because the government failed to positively prove its elements, particularly prejudice from delay, given that only a foundation existed and the government had abandoned the project.