Dalion vs. Court of Appeals

A contract of sale of real property is valid and binding between the parties even if embodied in a private document, because Article 1358 of the Civil Code, which requires acts involving real rights over immovable property to appear in a public instrument, is a rule of convenience and not a condition for validity or enforceability; the vendee may thereafter compel the vendor to execute the corresponding public instrument.

Segundo Dalion and his wife Epifania Sabesaje-Dalion owned a parcel of land in Panyawan, Sogod, Southern Leyte, declared under Tax Declaration No. 11148, which they acquired in 1960 from Saturnina Sabesaje through an "Escritura de Venta Absoluta." Ruperto Sabesaje, Jr. was their relative. Since 1958, the Dalion spouses had been administering five parcels of land in Sogod belonging to Leonardo Sabesaje, grandfather of Ruperto, who died in 1956, under an arrangement entitling them to 10% and 15% commissions on sales of copra and abaca, respectively—commissions which they claimed were never paid.

On May 28, 1973, Ruperto Sabesaje, Jr. filed a complaint to recover ownership of a parcel of land located in Panyawan, Sogod, Southern Leyte, declared in the name of Segundo Dalion under Tax Declaration No. 11148, with an area of 8,947 hectares and assessed at ₱180.00. Sabesaje's claim rested on a private document of absolute sale dated July 1, 1965 (Exhibit "A"), which he alleged Dalion had executed in his favor. According to Sabesaje, after executing the deed of sale, the Dalions had pleaded with him—their relative—to be allowed to continue administering the land because Dalion had no other means of livelihood.

Dalion denied the sale altogether. He contended that the document sued upon was fictitious, that his signature thereon was a forgery, and that the subject land was conjugal property which he and his wife had acquired in 1960 from Saturnina Sabesaje through an "Escritura de Venta Absoluta" (Exhibit "B"). The spouses denied Sabesaje's account that they had pleaded to remain on the land. They admitted, however, that they had been administering five parcels of land in Sogod since 1958, belonging to Leonardo Sabesaje, Ruperto's grandfather, who had died in 1956. Under their arrangement, they were entitled to 10% and 15% commissions on the sales of copra and abaca, respectively, which they never received. They asserted that Sabesaje's suit was intended merely to harass, preempt, and forestall Dalion's threat to sue for these unpaid commissions.

The trial court found the identity of the land in both Exhibit "A" and Exhibit "B" to be the same, as both documents described identical boundaries: on the north, property of Sergio Destriza and Titon Veloso; on the east, property of Feliciano Destriza; on the south, property of Barbara Boniza; and on the west, Catalino Espina. The court credited the positive testimonies of instrumental witnesses Gerardo M. Ogsoc and Espina, who stated that they witnessed the execution and signing of the deed. Ogsoc testified that he had prepared the deed of sale and copied portions thereof, including the boundaries, from Exhibit "B," even reproducing the erroneous spelling of the wife's name as "Esmenia." Against Dalion's mere denial of having signed, the trial court found the positive testimonies of the instrumental witnesses and the plaintiff to prevail. Dalion had alleged forgery but presented no witness or evidence to substantiate the claim. The court further conducted a comparison of the questioned signatures (Exhibits A-2 and A-3) with admitted signatures (Exhibits X and Y or 3-C) and with signatures appearing on the summons, return card, court orders, and notice of April 13, 1983, and found them to be written by the same person. The Court of Appeals affirmed these findings in toto, and the Supreme Court found no reason to deviate from the appellate court's rulings.

• Forgery and Fictitious Document: Petitioner Dalion maintained that the private document of absolute sale (Exhibit "A") was fictitious and that his signature thereon was a forgery, contending that no sale ever took place.
• Conjugal Property: Petitioner argued that the subject land was conjugal property acquired by him and his wife in 1960 from Saturnina Sabesaje, and thus could not have been validly sold without the wife's conformity.
• Necessity of Public Document: Assuming the authenticity of his signature and the genuineness of the document, petitioner nonetheless impugned the validity of the sale on the ground that it was embodied in a private document, invoking Article 1358 of the Civil Code, which provides that acts and contracts having for their object the creation, transmission, modification, or extinction of real rights over immovable property must appear in a public instrument.
• Improper Remedy: Petitioner contended that the proper action should have been one for specific performance rather than recovery of ownership.
• Unpaid Commissions and Harassment: Petitioner asserted that Sabesaje's suit was intended merely to harass, preempt, and forestall Dalion's threat to sue for unpaid commissions on copra and abaca sales from the administration of Leonardo Sabesaje's lands.

• Validity of the Sale: Respondent Sabesaje relied on the private document of absolute sale (Exhibit "A") as a valid and binding conveyance of the parcel of land, asserting that the sale was duly executed by Dalion in his favor on July 1, 1965.
• Authenticity Proven by Witnesses: Respondent's position, as sustained by the courts, was that the execution and authenticity of the private document were established through the testimonies of instrumental witnesses who saw the deed executed and signed, pursuant to Sections 21 and 23 of Rule 132 of the Revised Rules of Court.
• Recovery of Ownership as Proper Action: Respondent maintained that the suit for recovery of ownership was proper, premised on the binding effect and validity inter partes of the contract of sale, seeking merely the consummation of the perfected contract.

• Validity of the Sale: Whether the contract of sale of a parcel of land embodied in a private document is valid and binding between the parties.
• Necessity of a Public Document: Whether a public document is necessary for the validity of a contract of sale of real property, such that a sale in a private instrument cannot convey title or ownership.
• Proper Remedy: Whether a suit for recovery of ownership is the proper action to enforce a perfected contract of sale embodied in a private document.

• Validity of the Sale: Yes. The sale was valid and binding, the authenticity of the private document having been established through the positive testimonies of instrumental witnesses and a comparison of questioned signatures with admitted specimens, all of which the trial and appellate courts found convincing.
• Necessity of a Public Document: No. A public document is not required for the validity or enforceability of a contract of sale of real property; Article 1358 of the Civil Code is a rule of convenience, not validity, and a contract of sale being consensual is perfected by mere consent.
• Proper Remedy: Yes. A suit for recovery of ownership is proper, as Article 1475 of the Civil Code gives the parties to a perfected contract of sale the right to reciprocally demand performance, and the action merely seeks the consummation of the contract.

• Validity of the Sale: The appellate court upheld the validity of the sale on the basis of Sections 21 and 23 of Rule 132 of the Revised Rules of Court, which allow the execution and authenticity of a private writing to be proved by anyone who saw the writing executed, by evidence of the genuineness of the maker's handwriting, or by a subscribing witness. The trial court found that instrumental witnesses Ogsoc and Espina positively testified that the deed had been executed and signed by the signatories thereto. Ogsoc declared that he prepared the deed and copied parts from the "Escritura de Venta Absoluta" (Exhibit "B"), including the boundaries and the erroneous spelling of the wife's name. Against Dalion's mere denial, these positive testimonies prevailed. Dalion alleged forgery but presented no evidence to prove it; under Section 1, Rule 131, each party must prove his own affirmative allegations, and under Section 5(a) of the same Rule, a person is presumed innocent of crime or wrong, so the defense should have come forward with clear and convincing evidence of forgery. The trial court further compared the questioned signatures (Exhibits A-2 and A-3) with admitted signatures (Exhibits X and Y or 3-C) and with signatures appearing on the summons, return card, court orders, and notice of April 13, 1983, and found them to be written by one person. The presence of two signatures on the document—one at the bottom right corner and another at the left margin—was deemed inconsistent with forgery, as a forger would not risk an unnecessary second signature for fear of committing a revealing error. The Supreme Court declined to disturb these factual findings, reiterating that conclusions and findings of fact by trial courts are entitled to great weight on appeal and should not be disturbed absent strong and cogent reasons.

• Necessity of a Public Document: Dalion's reliance on Article 1358 of the Civil Code was misplaced. That provision's requirement of a public instrument for acts and contracts involving the creation, transmission, modification, or extinction of real rights over immovable property is only for convenience, not for validity or enforceability. A contract of sale is a consensual contract, perfected by mere consent, and no particular form is required for its validity. Upon perfection, the parties may reciprocally demand performance under Article 1475: the vendee may compel transfer of ownership, and the vendor may require payment of the price under Article 1458. The trial court thus correctly ordered Dalion to deliver the land and execute a formal deed of conveyance in a public document. Under Article 1498, when a sale is made through a public instrument, the execution thereof is equivalent to delivery of the thing; delivery may be actual or constructive. The vendee's right to compel execution of a public instrument flows from Article 1357, which allows a party to compel another to observe a particular form once the contract appearing in a private instrument has been perfected.

• Proper Remedy: The suit for recovery of ownership was proper. Article 1475 gives the parties to a perfected contract of sale the right to reciprocally demand performance and to observe a particular form if warranted under Article 1357. The trial court observed that Sabesaje's complaint sufficiently alleged a cause of action to compel Dalion to execute a formal deed of sale, and the suit for recovery of ownership, premised on the binding effect and validity inter partes of the contract of sale, merely sought the consummation of that contract. A sale of real property may be in a private instrument, but the contract is valid and binding between the parties upon perfection, and a party may compel the other to execute a public instrument embodying their contract affecting real rights once the contract in the private instrument has been perfected.

• Public Document Requirement as Rule of Convenience (Article 1358, Civil Code) — The requirement that acts and contracts involving real rights over immovable property appear in a public instrument is only for convenience, not for validity or enforceability. A contract of sale of real property embodied in a private document is valid and binding between the parties upon perfection, and the vendee may thereafter compel the vendor to execute the corresponding public instrument. The Court applied this by affirming that Dalion's sale to Sabesaje, though in a private document, was valid and binding, and the trial court properly ordered execution of a formal deed of conveyance.

• Consensual Nature of Contract of Sale — A contract of sale is consensual, meaning it is perfected by mere consent; no particular form is required for its validity. Upon perfection, the parties may reciprocally demand performance—the vendee may compel transfer of ownership, and the vendor may require payment of the price. The Court applied this by holding that the sale was perfected upon consent, giving Sabesaje the right to demand delivery and execution of a public instrument.

• Great Weight of Trial Court Findings of Fact on Appeal — Conclusions and findings of fact by trial courts are entitled to great weight on appeal and should not be disturbed absent strong and cogent reasons, since the trial court is in a more advantageous position to examine real evidence and observe the demeanor of witnesses. The Court applied this by declining to disturb the factual findings of the trial court as affirmed by the Court of Appeals regarding the authenticity of the deed and the identity of Dalion's signature.

• Proof of Authenticity of Private Writings (Rule 132, Sections 21 and 23) — The due execution and authenticity of a private writing may be proved by anyone who saw the writing executed, by evidence of the genuineness of the maker's handwriting, or by a subscribing witness. Handwriting may be proved by a witness who has seen the person write or has acquired knowledge of the handwriting, or by comparison with writings admitted or proved to be genuine. The Court applied this by sustaining the trial court's reliance on the testimonies of instrumental witnesses and the comparison of questioned and admitted signatures.

• "The provision of Art. 1358 on the necessity of a public document is only for convenience, not for validity or enforceability. It is not a requirement for the validity of a contract of sale of a parcel of land that this be embodied in a public instrument." — This passage articulates the ratio decidendi on the second issue: that the public-document requirement under Article 1358 is not essential to the validity of a sale of real property, a principle frequently cited in subsequent jurisprudence on contracts involving immovable property.

• "A contract of sale is a consensual contract, which means that the sale is perfected by mere consent. No particular form is required for its validity. Upon perfection of the contract, the parties may reciprocally demand performance (Art. 1475, NCC), i.e., the vendee may compel transfer of ownership of the object of the sale, and the vendor may require the vendee to pay the thing sold (Art. 1458, NCC)." — This passage defines the consensual nature of the contract of sale and the reciprocal obligations arising upon perfection, establishing the doctrinal basis for the vendee's right to compel execution of a public instrument.

• "Mere denial of having signed, does not suffice to show forgery." — This passage states the evidentiary rule that a bare denial of signature, without supporting evidence, is insufficient to establish forgery, particularly where positive testimonies of instrumental witnesses and signature comparisons establish authenticity.

• Chase vs. Buencamino, Sr., G.R. No. L-20395, May 13, 1985, 136 SCRA 365 — Followed for the principle that findings of fact by trial courts are entitled to great weight on appeal and should not be disturbed absent strong and cogent reasons, since the trial court is better positioned to examine evidence and observe witness demeanor.
• Pring vs. Court of Appeals, G.R. No. L-41605, August 19, 1985, 138 SCRA 185 — Followed for the same principle regarding the great weight accorded to trial court factual findings on appeal.

• Article 1358, Civil Code of the Philippines — Provides that acts and contracts which have for their object the creation, transmission, modification, or extinction of real rights over immovable property must appear in a public instrument. The Court held this requirement to be one of convenience, not validity or enforceability, and thus not a bar to the binding effect of a sale embodied in a private document.
• Article 1475, Civil Code of the Philippines — Provides that the contract of sale is perfected upon the meeting of minds on the thing sold and the price, and that upon perfection the parties may reciprocally demand performance. The Court relied on this provision to establish that Sabesaje, as vendee, could compel Dalion to deliver the land and execute a formal deed.
• Article 1458, Civil Code of the Philippines — Obliges the vendor to transfer ownership of and deliver the thing sold. Applied to support the reciprocal obligations of the parties upon perfection of the sale.
• Article 1498, Civil Code of the Philippines — Provides that when the sale is made through a public instrument, the execution thereof is equivalent to delivery of the thing. The Court cited this to explain that delivery of land may be constructive through execution of a public instrument, which the trial court properly ordered.
• Article 1357, Civil Code of the Philippines — Allows a party to compel another to observe a particular form once a contract appearing in a private instrument has been perfected. Applied to support the vendee's right to compel execution of a public instrument embodying the sale.
• Sections 21 and 23, Rule 132, Revised Rules of Court — Govern the proof of due execution and authenticity of private writings and the proof of handwriting. The Court sustained the appellate court's reliance on these provisions in upholding the authenticity of the private deed of sale.
• Sections 1 and 5(a), Rule 131, Revised Rules of Court — Provide that each party must prove his own affirmative allegations and that a person is presumed innocent of crime or wrong. Applied to hold that Dalion, having alleged forgery, bore the burden of proving it with clear and convincing evidence, which he failed to do.

Narvasa, Cruz, Gancayco, and Grino-Aquino, JJ., concurred.