In the Matter of the Guardianship of Angela Tuazon de Perez

A guardianship court has no jurisdiction to determine or adjudicate the right or ownership of property claimed by the guardian to belong to the incompetent as against a third party stranger to the compromise agreement, nor to order the surrender of such property; the controversy must be resolved in a separate independent action before a regular court of competent jurisdiction.

Antonio M. Perez and Angela Tuazon de Perez were spouses. Angela possessed paraphernal real properties in Manila. Perez had previously filed a case in the Manila Court of First Instance to place Angela under guardianship due to alleged prodigality, which was dismissed for lack of jurisdiction and affirmed by the Supreme Court. A compromise agreement was executed on May 2, 1958, whereby Angela, through her attorney-in-fact Roberto Della Rosa, ceded certain paraphernal properties to Perez and his son Benigno. The compromise agreement's validity and effectivity became the subject of multiple proceedings before different courts, including the Juvenile and Domestic Relations Court of Manila and the Supreme Court, culminating in the Court's approval of the compromise agreement on November 17, 1966 in Case L-19711, after Angela confirmed it through her daughter and attorney-in-fact Angela Perez de Staley.

Antonio M. Perez and Angela Tuazon de Perez were spouses, with Angela owning paraphernal real properties in Manila. On October 29, 1957, Angela personally sold five properties covered by T.C.T. Nos. 24923, 24924, 24926, 24929, and 24930 to Monserrat Enterprises Co., Inc. Monserrat took possession of the properties, which remained under its control. However, for unknown reasons, the deeds of sale in Monserrat's favor were not registered until after May 2, 1958.

On May 2, 1958, a compromise agreement was executed between Perez and his son Benigno on one hand, and Angela on the other, represented by her attorney-in-fact Roberto Della Rosa. The compromise agreement was submitted to the Manila Court of First Instance purportedly to settle Civil Case No. 34626, the guardianship case Perez had filed against Angela. That case was dismissed by the Manila court for lack of jurisdiction, a dismissal affirmed by the Supreme Court on September 30, 1960 in L-14874. Sometime after May 2, 1958, the deeds of sale in favor of Monserrat were registered, and new certificates of title—T.C.T. Nos. 53290, 53286, 53287, 53288, and 53289—were issued in Monserrat's name, subject to an annotation of the compromise agreement which had in the interval been annotated on Angela's original titles.

The compromise agreement was then submitted to the Juvenile and Domestic Relations Court of Manila for approval in Special Proceeding No. 03123, but that court dismissed the proceeding for lack of jurisdiction over the subject matter, since Civil Case No. 34626 had been finally dismissed and there was no more case to settle by compromise. Perez appealed the dismissal to the Supreme Court in L-19711. Pending that appeal, in November 1966, Angela's daughter and attorney-in-fact, Angela Perez de Staley, submitted the same compromise agreement anew to the Supreme Court, manifesting that Angela "now confirms the compromise agreement." The Supreme Court approved the compromise agreement by its resolution of November 17, 1966. Under the compromise agreement, Angela inter alia ceded to Perez seven real properties of her paraphernal estate, including the five properties she had already sold to Monserrat.

On February 6, 1967, Monserrat filed a complaint directly with the Supreme Court for quieting of title and damages against Perez and his son, which was dismissed by resolution of February 22, 1967. Monserrat then filed a separate complaint before the Court of First Instance of Manila raising the question of "intrinsic nullity" of the compromise agreement, which was dismissed by the Manila court; Monserrat's appeal of that dismissal was likewise dismissed by the Supreme Court on June 26, 1968 for failure to file the required answer and submit printed copies of the Record on Appeal. Meanwhile, Perez filed a "second motion for partial execution" with the domestic court, seeking an order requiring Monserrat to surrender the five certificates of title. Monserrat opposed, asserting prior right of ownership by virtue of the October 1957 sales, its right to its day in court, and the domestic court's lack of jurisdiction over its person and the subject matter. The domestic court denied the motion in its orders of April 17 and May 29, 1967, ruling that it could not resolve a title controversy between a third party and parties to the compromise agreement, and that the transfer to Perez should be construed only as a transfer of whatever rights Angela might have in the properties.

During the pendency of Perez's appeal, it was manifested that on May 18, 1967, the annotation of the compromise agreement on Monserrat's five certificates had been cancelled by the Register of Deeds of Manila without court authority. The properties were thereafter sold free from any annotation to five separate purchasers: Vicente Dy Pangilinan, Angel Cantada, Amanda Viray/Julio Viola/Antonio Viray, Aurora Lebron/Alfonso Ayesa, and the City of Manila, all of whom asserted they acquired clean titles in good faith and for value. Angela Perez de Staley was allowed to intervene on January 15, 1970, alleging that Perez had undertaken to hold the properties in trust for the children, but no further pleading in intervention appears in the record.

• Binding Effect of Supreme Court Resolution: Petitioner contended that the November 17, 1966 resolution of the Supreme Court in Case L-19711 approving the compromise agreement "is conclusive upon the titles referred to in the same," characterizing it as "a judgment on the specific things and as such is binding on the whole world."
• Monserrat Bound by Annotation: Petitioner argued that Monserrat acquired the five titles subject to the annotation of the compromise agreement on its new titles, and was therefore bound by the Supreme Court's order approving said compromise agreement.

• Prior Title and Ownership: Monserrat asserted its right of prior title and ownership to the properties by virtue of having purchased them from Angela as far back as October 29, 1957, before the compromise agreement was executed.
• Right to Day in Court: Monserrat invoked its right to its day in court, asserting the domestic court lacked jurisdiction over its person and the subject matter.
• Nullity of Cession: The Virays, as subsequent purchasers from Monserrat, asserted the nullity of the cession of Angela's properties to her husband Perez in the absence of judicial separation of property, citing Articles 133 and 1490 of the Civil Code.
• Good Faith Purchase: The five transferees from Monserrat asserted they acquired clean titles to the properties in good faith and for value, free from any annotation of adverse claims or liens.

• Jurisdiction of Guardianship Court: Whether the Juvenile and Domestic Relations Court, sitting as a guardianship court, had jurisdiction to order a third-party stranger to the compromise agreement to surrender certificates of title to properties in dispute.
• Binding Effect of Compromise Approval: Whether the Supreme Court's resolution of November 17, 1966 approving the compromise agreement constituted a judgment binding on the whole world and on strangers to the agreement.
• Retroactivity of Transfer: Whether the transfer of Angela's paraphernal properties under the compromise agreement retroacted to May 2, 1958, the date of its original execution, or was effective only as of November 1966 when Angela confirmed and the Supreme Court approved it.

• Jurisdiction of Guardianship Court: No. A guardianship court has no jurisdiction to determine or adjudicate the right or ownership of property claimed by the guardian to belong to the incompetent as against a third party, nor to order the surrender thereof; such controversy must be resolved in a separate independent action before a regular court of competent jurisdiction.
• Binding Effect of Compromise Approval: No. The Supreme Court's resolution approving the compromise agreement was not a judgment on the merits binding on the whole world; it merely approved a compromise agreement on Angela's manifestation that she "now confirms" the same, and did not adjudicate prior conveyances to strangers.
• Retroactivity of Transfer: No. The transfer of properties under the compromise agreement as confirmed in November 1966 was effective only as of that later date and could not retroact to May 2, 1958, when the agreement was originally executed to settle a case that was eventually dismissed.

• Jurisdiction of Guardianship Court: The domestic court correctly held itself without jurisdiction. Monserrat was a stranger to the compromise agreement and could not be bound thereby, nor was it subject to the domestic court's jurisdiction. It is beyond dispute that a guardianship court has no jurisdiction to determine or adjudicate the right or ownership of property claimed by the guardian to belong to the incompetent as against a third party. The domestic court's ruling that the cession of properties to Perez was but a transfer of whatever rights Angela might have over the properties at the time of the transfer accords with the fundamental principle that one cannot give that which he does not have. The intervening rights of fourth parties—the City of Manila and four other vendees who purchased from Monserrat free from liens and hold clean titles—further underscore the domestic court's lack of jurisdiction over the controversy.

• Binding Effect of Compromise Approval: Perez's contention that the November 17, 1966 resolution is "conclusive upon the titles" and "binding on the whole world" is untenable. No judgment whatsoever was rendered by the Supreme Court in L-19711; the case then pending was Perez's appeal from the domestic court's order dismissing the proceeding for lack of jurisdiction, since there was no more case to be settled by compromise. The Court merely approved the compromise agreement on Angela's manifestation that she "now confirms" it. It is self-evident that any transfers of paraphernal properties Angela executed during the intervening eight years could not have been passed upon by the Court, all the more so with regard to transfers executed even before the compromise agreement, as with the sales to Monserrat on October 29, 1957.

• Retroactivity of Transfer: The transfer of properties to respondents could in no way be deemed to retroact to over eight years back to May 2, 1958, when the compromise agreement was originally executed to settle Case No. 34626, which was eventually dismissed in 1960 for lack of jurisdiction. The transfer was effective only as of November 1966, when Angela confirmed the compromise agreement and the Supreme Court approved it. This finding, made in the companion case of Ampil vs. Agrava, holds true and equally applies to Perez's present claims, absent any new material facts or documents that would radically alter the record. Whether Monserrat's purchase was effective as of October 29, 1957 or only after registration subsequent to May 2, 1958 is a question that cannot be settled by a mere motion before the guardianship court.

• Jurisdiction of Guardianship Courts — A guardianship court has no jurisdiction to determine or adjudicate the right or ownership of property claimed by the guardian to belong to the incompetent as against a third party, nor to order the surrender of such property. The controversy must be resolved in a separate independent action before a regular court of competent jurisdiction. The Court applied this doctrine to hold that the domestic court correctly denied Perez's motion for partial execution, as Monserrat was a stranger to the compromise agreement and not subject to the guardianship court's jurisdiction.

• Nemo dat quod non habet (One cannot give what one does not have) — The cession of properties in a compromise agreement approved by the Court transfers only whatever rights the cedent might have over the properties at the time of the transfer. The Court applied this principle to hold that the transfer to Perez under the compromise agreement as confirmed in November 1966 was effective only as of that date and could not defeat prior conveyances Angela had made to Monserrat in October 1957.

• Effectivity of Compromise Agreements Upon Judicial Approval — A compromise agreement that is confirmed anew by a party and approved by the Court at a date much later than its original execution is effective only as of the date of confirmation and approval, not retroactively to the date of original execution. The Court held that the transfer of Angela's properties under the compromise agreement did not retroact to May 2, 1958, but was effective only as of November 17, 1966.

• "It is beyond dispute that a guardianship court such as the lower court has no jurisdiction to determine or adjudicate the right or ownership of property claimed by the guardian to belong to the incompetent as against a third party nor to order surrender thereof and that such a controversy would have to be resolved in a separate independent action before a regular court of competent jurisdiction." — This passage states the ratio decidendi defining the jurisdictional limits of guardianship courts over property disputes involving strangers to the proceedings.

• "The transfer of said properties to respondents could in no way be deemed to retroact to over 8 years back on May 2, 1958, when the compromise agreement was originally executed, presumably to settle Case No. 34626 which was eventually dismissed in 1960 for lack of jurisdiction of the Manila court. The transfer of the said properties as provided in the compromise agreement as now confirmed in November, 1966 by Angela and approved by this Court in its Resolution of November 17, 1966 was effective only as of this much later date." — This passage, quoted from the companion case Ampil vs. Agrava, establishes the doctrine on the non-retroactivity of compromise agreements that are confirmed and approved years after their original execution.

• "The domestic court's ruling that the cession of the properties in question to Perez by his spouse Angela in accordance with the compromise agreement approved by the Court's resolution of November 17, 1966 in Case No. 19711 was but a transfer of whatever rights Angela might have over the properties at the time of the transfer, is in accordance with the fundamental principle that one cannot give that which he does not have." — This passage applies the principle of nemo dat quod non habet to the transfer of properties under a compromise agreement where the cedent had already conveyed the same properties to a third party.

• Armando V. Ampil vs. Hon. Judge Corazon Juliano Agrava, et al., L-27394 (July 31, 1970) — Companion case cited as controlling authority on the effectivity date of the compromise agreement and on the attorney's retaining lien issue. The Court applied its ruling that the transfer of properties under the compromise agreement was effective only as of November 1966, not retroactively to May 2, 1958.

• Antonio M. Perez, et al. vs. Angela Tuazon de Perez, L-19711 — The prior appeal in which the Supreme Court approved the compromise agreement on November 17, 1966. The Court clarified that this resolution was not a judgment on the merits but merely an approval of a compromise agreement.

• Cui vs. Piccio, 91 Phil. 712 (1952) — Cited as authority for the proposition that a guardianship court has no jurisdiction to adjudicate ownership of property claimed by a third party against the incompetent's estate.

• Modesto vs. Modesto, 105 Phil. 1066 (1959) — Cited alongside Cui vs. Piccio in support of the jurisdictional limitation on guardianship courts.

• Rule 96, Section 6, Rules of Court — Cited in support of the rule that a guardianship court lacks jurisdiction to determine ownership of property claimed by a stranger, as referenced in Moran's Comments.
• Articles 133 and 1490, Civil Code — Cited by the Virays in asserting the nullity of the cession of Angela's paraphernal properties to her husband Perez in the absence of judicial separation of property. Article 133 pertains to donations between spouses, and Article 1490 prohibits sales between spouses.

Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Zaldivar, Castro, Fernando, and Barredo, JJ., concurred. Villamor, J., took no part. Makasiar, J., was on leave.