Francisco vs. Boiser

A co-owner may exercise legal redemption on the basis of actual knowledge of the sale even without the vendor’s written notice under Art. 1623, where the sale is already established and requiring vendor notice would further delay the redemption; receipt of summons in the vendee’s action constitutes such actual knowledge and starts the 30-day period.

Petitioner Adalia B. Francisco and respondent Zenaida F. Boiser are sisters. Their family held co-ownership interests in four registered parcels in Caloocan City on which the Ten Commandments Building stands. Art. 1623 of the Civil Code governs a co-owner’s legal redemption of a share sold to a stranger.

Petitioner Adalia B. Francisco and her sisters Ester, Elizabeth, and Adeluisa were co-owners of four parcels of registered land on which the Ten Commandments Building at 689 Rizal Avenue Extension, Caloocan City stands. On August 6, 1979, they sold 1/5 of their undivided share in the parcels to their mother, Adela Blas, for P10,000.00, making Adela a co-owner to that extent.

On August 8, 1986, without the knowledge of the other co-owners, Adela Blas sold her 1/5 share for P10,000.00 to respondent Zenaida Boiser, another sister of petitioner. On August 5, 1992, petitioner received summons with a copy of the complaint in Civil Case No. 15510, filed by respondent demanding her share in the rentals being collected by petitioner from the building’s tenants. Petitioner then informed respondent that she was exercising her right of redemption as a co-owner. On August 12, 1992, she deposited P10,000.00 as redemption price with the Clerk of Court. The redemption was interposed as a permissive counterclaim in Civil Case No. 15510, but that case was dismissed after respondent was declared non-suited, and petitioner’s counterclaim was likewise dismissed.

On September 14, 1995, petitioner instituted Civil Case No. C-17055 before the RTC in Caloocan City. She alleged that the 30-day redemption period under Art. 1623 had not begun to run against her because the vendor, Adela Blas, never informed her or the other owners of the sale to respondent; she learned of the sale only on August 5, 1992, when she received the summons and complaint in Civil Case No. 15510.

Respondent contended that petitioner knew of the sale as early as May 30, 1992, because on that date respondent wrote petitioner a letter informing her of the sale and demanding that the rentals corresponding to respondent’s 1/5 share be remitted to her; the letter was sent with a copy of the deed of sale between respondent and Adela Blas. On the same date, respondent also sent letters to the building’s tenants, Seiko Service Center and Glitters Corporation, informing them of the sale and requesting that they thenceforth pay 1/5 of the monthly rentals to respondent. Petitioner received these letters, as shown by her June 8, 1992 letter to the tenants advising them to disregard respondent’s request and continue paying full rentals directly to her.

The RTC found that no written notice was given by the vendor, Adela Blas, to petitioner or the other owners, but that petitioner had received respondent’s May 30, 1992 letter and was furnished a copy of the deed evidencing the sale. It also noted petitioner’s June 8, 1992 letter to the tenants.

• Vendor’s Notice Under Art. 1623: Petitioner argued that the issue was not the form of notice but whether a notice sent by the vendee may be given in lieu of that required to be given by the vendor; the cited cases on form were therefore not relevant.
• Accrual of the 30-Day Period: Petitioner maintained that the 30-day period had not begun to run because vendor Adela Blas never informed her or the other owners of the sale; she learned of it only on August 5, 1992, upon receipt of summons in Civil Case No. 15510.

• Actual Knowledge: Respondent contended that petitioner knew of the sale as early as May 30, 1992, when respondent wrote her a letter informing her of the sale, demanding her 1/5 share of rentals, and enclosing a copy of the deed of sale; respondent also wrote the tenants on the same date, and petitioner’s June 8, 1992 letter to the tenants proved receipt.

• Notice Requirement in Legal Redemption: Whether the May 30, 1992 letter sent by respondent-vendee to petitioner, notifying her of the sale and containing a copy of the deed, can be considered sufficient compliance with the notice requirement of Art. 1623 for purposes of legal redemption.

• Notice Requirement in Legal Redemption: No, not as the written notice required by Art. 1623, which must come from the vendor or prospective vendor. But petitioner’s receipt of summons on August 5, 1992 gave actual knowledge of the sale, and her August 12, 1992 deposit of P10,000.00 was timely.

• Notice Requirement in Legal Redemption: Art. 1623 provides that the right of legal redemption must be exercised within 30 days from written notice by the prospective vendor or the vendor, as the case may be, and that the deed of sale cannot be recorded unless accompanied by the vendor’s affidavit that written notice was given to all possible redemptioners. The SC held that Art. 1623 is clear in requiring that the written notification come from the vendor or prospective vendor, not from any other person, and that there is no room for construction. The old Art. 1524 of the Civil Code of 1889 did not specify who must give notice; Art. 1623 deliberately selected the vendor, and effect must be given to this change. The vendor of an undivided interest is in the best position to know who the co-owners are and to confirm the fact of the sale, its perfection, and its validity; notice from the buyer does not give the same assurance. The SC noted that Etcuban vs. Court of Appeals had held that notice by the vendees was sufficient and had overruled Butte vs. Manuel Uy & Sons, Inc. sub silencio, but Salatandol vs. Retes later expressly affirmed Butte and held that notice by the Register of Deeds was insufficient. The SC also reasoned that a vendor can delay or effectively prevent the meaningful exercise of redemption by not immediately notifying the co-owner; in this case, the sale took place in 1986 but was kept secret until 1992, when the vendee needed to notify petitioner to demand 1/5 of the rentals. The only adverse effect on vendor Adela Blas and respondent-vendee is that the sale could not be registered; it is non-binding only insofar as third persons are concerned. The SC thus ruled that it would be unjust to further delay petitioner’s exercise of legal redemption by requiring vendor notice before she could exercise her right, and that receipt of summons in Civil Case No. 15510 on August 5, 1992 constituted actual knowledge on the basis of which petitioner could exercise her right of redemption. The SC found support in Alonzo vs. Intermediate Appellate Court, where written notification was dispensed with because the redemptioners had actual knowledge of the sales. In the present case, receipt of summons on August 5, 1992 amounted to actual knowledge from which the 30-day period commenced to run; petitioner had until September 4, 1992, and her August 12, 1992 deposit of P10,000.00 was timely, so the redemption should be given effect.

• Legal redemption under Art. 1623 — A co-owner has 30 days from written notice by the vendor or prospective vendor to redeem a share sold to a stranger; the deed of sale cannot be recorded unless accompanied by the vendor’s affidavit of written notice to all possible redemptioners. Applied: vendor Adela Blas gave no vendor notice, so the statutory notice was absent; the vendee’s May 30, 1992 letter did not satisfy it.
• Vendor as the notice-giver — Art. 1623 deliberately requires the written notice to come from the vendor or prospective vendor, not from the vendee or any other person; the vendor is in the best position to know the co-owners and to confirm the sale’s fact, perfection, and validity. Applied: respondent’s letter, though informing petitioner, was not the notice contemplated by Art. 1623.
• Actual knowledge as basis for redemption — Where the sale is already established and the vendor has not given the required notice, the redemptioner’s actual knowledge of the sale can start the 30-day redemption period; Alonzo dispensed with written notice where actual knowledge existed. Applied: receipt of summons on Aug. 5, 1992 gave petitioner actual knowledge; her Aug. 12, 1992 deposit was timely.
• Effect of absence of vendor notice on registration — Without the vendor’s affidavit of written notice, the deed of sale cannot be recorded; the sale is non-binding only insofar as third persons are concerned. Applied: the only adverse effect on vendor and vendee was that the sale could not be registered, which did not justify further delaying petitioner’s redemption.

• "Art. 1623 of the Civil Code is clear in requiring that the written notification should come from the vendor or prospective vendor, not from any other person. There is, therefore, no room for construction." — The SC rejects the vendee’s letter as the statutory written notice and holds that the vendor must be the notice-giver.
• "The seller of an undivided interest is in the best position to know who are his co-owners that under the law must be notified of the sale. Also, the notice by the seller removes all doubts as to fact of the sale, its perfection, and its validity, the notice being a reaffirmation thereof; so that that party notified need not entertain doubt that the seller may still contest the alienation. This assurance would not exist if the notice should be given by the buyer." — The SC explains why Art. 1623 requires the vendor, not the vendee, to give notice.
• "It is, therefore, unjust when the subject sale has already been established before both lower courts and now, before this Court, to further delay petitioner's exercise of her right of legal redemption by requiring that notice be given by the vendor before petitioner can exercise her right. For this reason, we rule that the receipt by petitioner of summons in Civil Case No. 15510 on August 5, 1992 constitutes actual knowledge on the basis of which petitioner may now exercise her right of redemption within 30 days from finality of this decision." — The SC allows redemption on the basis of actual knowledge from the summons despite the absence of vendor notice.
• "In the present case, as previously discussed, receipt by petitioner of summons in Civil Case No. 15510 on August 5, 1992 amounted to actual knowledge of the sale from which the 30-day period of redemption commenced to run. Petitioner had until September 4, 1992 within which to exercise her right of legal redemption, but on August 12, 1992 she deposited the P10,000.00 redemption price. As petitioner's exercise of said right was timely, the same should be given effect." — The SC computes the period from actual knowledge and holds the deposit timely.

• Butte vs. Manuel Uy & Sons, Inc., 4 SCRA 526 (1962) — Controlling precedent; held that Art. 1623 requires the notice to be given by the vendor, and the SC followed it.
• Salatandol vs. Retes, 162 SCRA 568 (1988) — Controlling precedent; expressly affirmed Butte and held that notice by the Register of Deeds was insufficient.
• Etcuban vs. Court of Appeals, 148 SCRA 507 (1987) — Discussed and limited; had held that notice by the vendees was sufficient and overruled Butte sub silencio, but Salatandol later restored Butte.
• Alonzo vs. Intermediate Appellate Court, 150 SCRA 259 (1987) — Followed by analogy; dispensed with written notice where the redemptioners had actual knowledge of the sale.

• Art. 1623, Civil Code — Requires legal redemption to be exercised within 30 days from written notice by the prospective vendor or vendor; the deed of sale cannot be recorded unless accompanied by the vendor’s affidavit of written notice to all possible redemptioners; the right of redemption of co-owners excludes adjoining owners. Applied: vendor notice was absent, the vendee’s letter was not statutory notice, but actual knowledge from summons triggered the period and the deposit was timely.
• Art. 1524, Civil Code of 1889 — The former law did not specify who must give notice; Art. 1623 expressly designates the vendor. Applied: the SC gave effect to the deliberate statutory change.
• Section 51, Presidential Decree No. 1529 (Property Registration Decree) — Cited for the effect that a sale without the vendor’s affidavit of notice cannot be registered and is non-binding only as to third persons. Applied: the only adverse effect on vendor and vendee was non-registration, not enough to delay redemption.