Lopez vs. Saludo

An implied trust is created when one person pays the purchase price of property but legal title is conveyed to another, with the former becoming the beneficial owner and the latter the trustee; the burden of proving the trust's existence rests on the party asserting it, and the evidence must be clear and trustworthy.

Respondent Aniceto G. Saludo, Jr. and petitioner Doris Marie S. Lopez were involved in a special relationship described as boyfriend and girlfriend. Two parcels of land located in Barrio Pineda, Pasig City, were offered for sale by Bulalacao Realty Corporation (BRC). Petitioner informed respondent of the availability of these properties and offered to pose as the buyer because the seller, allegedly her close friend, wished to deal only with her. Respondent entrusted the purchase price to petitioner on the understanding that she would hold the properties in trust and subsequently reconvey them to him.

Sometime in April or May 1997, petitioner Doris Marie S. Lopez informed respondent Aniceto G. Saludo, Jr. that two parcels of land in Barrio Pineda, Pasig City, were being offered for sale at a reasonable price. Respondent was initially hesitant, but was eventually persuaded by petitioner's persistent assurances that the titles were clean, that transfer certificates of title would be issued in his name after the sale, and that the price was favorable given the properties' proximity to business centers. Petitioner offered to pose as the buyer because the seller, allegedly her close friend, wished to deal only with her to keep his financial constraints within his close family friends. Respondent then entrusted the purchase price of ₱15,000,000 to petitioner, with the agreement that petitioner would sign the Deed of Sale but hold the properties in trust for and subsequently reconvey them to respondent.

After the execution of the sale, petitioner began evading respondent and gave no update on the registration of the sale in his name. When respondent inquired into the status of the properties, he discovered that they had already been registered in petitioner's name, as evidenced by TCT Nos. PT-111136 and PT-111137 issued by the Register of Deeds of Pasig City, pursuant to a Deed of Absolute Sale dated May 25, 1999 executed by BRC in favor of petitioner. Petitioner, for her part, claimed that she purchased the properties from BRC in 1997 pursuant to a Deed of Sale under pacto de retro, and that since the properties were not repurchased by the vendor-a-retro, a Deed of Absolute Sale was executed in her favor. She further claimed that respondent volunteered to finance the renovation of the house on account of their special relationship, and that he and his family occupied the properties thereafter; when their relationship turned sour, respondent surreptitiously filed an adverse claim.

Respondent immediately assumed possession of the properties and introduced major renovations on the house amounting to ₱9,000,000. He paid real property taxes thereon for 13 years, and as the occupant, also paid homeowner's association dues. He made several oral and written demands upon petitioner to reconvey the properties, but to no avail. On July 31, 2001, respondent filed an Affidavit of Adverse Claim against petitioner over the properties and had it annotated on the TCTs. On June 9, 2006, petitioner filed a barangay complaint for ejectment against respondent, but respondent failed to attend the proceeding despite due notice. On July 19, 2006, respondent filed the Complaint for Reconveyance and Damages before the RTC, presenting four checks issued in petitioner's name for payment of the purchase price and asserting continuous actual possession of the properties. The RTC found that respondent proved by preponderance of evidence that he paid for the properties and that an implied trust existed, a conclusion the CA affirmed on appeal.

• No Implied Trust Created: Petitioner maintained that respondent failed to establish that an implied trust was created between them, arguing that by allowing her to enter into the contract of sale as the buyer, respondent clearly intended the properties to be registered in her name and for her to be the real owner on account of their special relationship.
• Payment Not Conclusive Proof of Ownership: Petitioner argued that respondent's payment of the purchase price, association dues, realty taxes, and renovation expenses is not conclusive proof of his ownership of the properties.
• Acquiescence: Petitioner insisted that respondent failed to assert his rights when petitioner registered the properties in her name, and that his total silence and lack of objection indicated acquiescence to the registration, precluding him from later claiming a contrary intention.
• Donation: Petitioner claimed that the purchase money was gratuitously given to her by respondent on account of their special relationship as boyfriend and girlfriend.

• Implied Trust: Whether respondent had sufficiently proved that an implied trust was created between him and petitioner.
• Jurisdiction: Whether the Court may review the factual findings of the lower courts under a Rule 45 Petition for Review on Certiorari.

• Implied Trust: Yes. An implied trust arose under Article 1448 of the Civil Code, respondent having proven by preponderance of evidence that he paid the purchase price through petitioner with the expectation of reconveyance, and having exercised acts of ownership over the properties.
• Jurisdiction: No, the Court cannot review factual issues under Rule 45. However, the Court found that the factual findings of the RTC, as confirmed by the CA, were final and conclusive, and saw no cogent reason to revisit them.

• Implied Trust: Under Article 1448 of the Civil Code, an implied trust is created when property is sold and the legal estate is granted to one party but the price is paid by another for the purpose of having the beneficial interest in the property. The former is the trustee, the latter the beneficiary. An implied trust arises not from any presumed intention of the parties but by operation of law to satisfy the demands of justice and equity. The burden of proving the existence of a trust rests on the party asserting it, and the evidence must be clear and satisfactory, though oral evidence is admissible if trustworthy and received with extreme caution. Both the RTC and CA found that respondent adduced evidence — the four checks issued for the purchase price, receipts for renovation materials, payroll of laborers, payment of real property taxes, and homeowner's dues — establishing his intention to acquire the properties for his own account. His actual possession from the moment of full payment, his expenditure of millions for renovations, and the transfer of tax declarations to his name all demonstrated positive acts indicating exclusive ownership. The Court found no cogent reason to revisit these well-supported conclusions. Petitioner's claim that the money was a gratuitous donation likewise failed: under Article 748 of the Civil Code, donations of personal property exceeding ₱5,000 must be made in writing, otherwise the donation is void. Petitioner never adduced evidence of any written instrument evincing a donation, and thus her claim necessarily failed, as in Carinan vs. Spouses Cueto and Spouses Devisfruto vs. Greenfell.

• Jurisdiction: A petition for review under Rule 45 is limited to questions of law; factual questions requiring re-evaluation of evidence are inappropriate. The Court is not a trier of facts and will not review facts already considered below. The errors reviewable are those of the CA, not directly those of the trial court. None of the recognized exceptions permitting review of factual issues was present. Nevertheless, the Court noted that when the factual findings of the trial court are confirmed by the CA, those facts are final and conclusive on the Court unless unsupported by the evidence on record. Finding the lower courts' conclusions well-supported, the Court saw no reason to disturb them.

• Implied Trust (Article 1448, Civil Code) — An implied trust arises when property is sold and legal title is granted to one party but the price is paid by another for the purpose of having the beneficial interest in the property. The titleholder is the trustee; the payer is the beneficiary. The trust arises by operation of law, not from presumed intention, to satisfy justice and equity. In this case, respondent's payment of the purchase price through petitioner, coupled with his actual possession, payment of taxes, and renovation expenditures, established the existence of an implied trust.

• Burden of Proof in Implied Trusts — The burden of proving the existence of a trust is on the party asserting it. The proof must be clear and satisfactory and must show the existence of the trust and its elements. While implied trusts may be proven by oral evidence, such evidence must be trustworthy and received with extreme caution, as oral evidence can easily be fabricated. In this case, respondent met the burden through documentary evidence (checks, receipts, payroll records, tax declarations) and testimony.

• Finality of Concurrent Factual Findings — When the factual findings of the trial court are confirmed by the CA, said facts are final and conclusive on the Supreme Court, unless unsupported by the evidence on record. The Court applied this doctrine to decline revisiting the lower courts' findings that an implied trust existed.

• Formal Requisites of Donation of Movables (Article 748, Civil Code) — Donations of personal property exceeding ₱5,000 must be made in writing, including both the donation and acceptance; otherwise, the donation is void. When a party claims that purchase money was gratuitously given as a donation, Article 748 applies. Petitioner's failure to present any written instrument evidencing the donation rendered her claim invalid.

• "An implied trust arises, not from any presumed intention of the parties, but by operation of law in order to satisfy the demands of justice and equity and to protect against unfair dealing or downright fraud." — This passage defines the nature and purpose of implied trusts, distinguishing them from express trusts and grounding them in equity rather than party intent.

• "The burden of proving the existence of a trust is on the party asserting its existence, and such proof must be clear and satisfactorily, show the existence of the trust and its elements. While implied trusts may be proven by oral evidence, the evidence must be trustworthy and received by the courts with extreme caution, and should not be made to rest on loose, equivocal or indefinite declarations." — This formulation states the standard of proof required for implied trusts, emphasizing the caution courts must exercise with oral evidence.

• "If the value of the personal property donated exceeds five thousand pesos, the donation and the acceptance shall be made in writing, otherwise, the donation shall be void." — This quotation of Article 748 of the Civil Code was applied to defeat petitioner's claim that the purchase money was a gratuitous donation, as no written instrument was presented.

• Miro vs. Vda. de Erederos, 721 Phil. 772 (2013) — Cited for the doctrine that a Rule 45 petition is limited to questions of law and that the Court's review is confined to errors of the appellate court, not the trial court. Followed.
• Spouses Devisfruto vs. Greenfell, G.R. No. 227725, July 1, 2020 — Cited for the proposition that if purchase money is claimed to have been gratuitously given as a donation, Article 748 of the Civil Code requires the donation and acceptance to be in writing if the value exceeds ₱5,000. Followed and applied to the facts.
• Carinan vs. Spouses Cueto, 745 Phil. 186 (2014) — Cited for the rule that donations of purchase money must comply with the formal requirements of Article 748, and that failure to present a written instrument evidencing the donation renders the claim invalid. Followed.
• Heirs of Francisco Narvasa, Sr. vs. Imbornal, 740 Phil. 541 (2014) — Cited for the standard of proof required to establish an implied trust, including the requirement that oral evidence be trustworthy and received with caution. Followed.
• Gatan vs. Vinarao, 820 Phil. 257 (2017) — Cited for the proposition that questions of fact are inappropriate under Rule 45. Followed.

• Article 1448, Civil Code — Provides that an implied trust is created when property is sold, legal estate is granted to one party, but the price is paid by another for the purpose of having the beneficial interest. Applied to find that petitioner was the trustee and respondent the beneficiary.
• Article 1456, Civil Code — Provides that if property is acquired through mistake or fraud, the person obtaining it is considered a trustee of an implied trust for the benefit of the person from whom the property comes. Cited in the decision's discussion of implied trusts arising by operation of law.
• Article 748, Civil Code — Requires that donations of personal property exceeding ₱5,000 be made in writing, including the donation and acceptance; otherwise void. Applied to reject petitioner's claim that the purchase money was a gratuitous donation, as no written instrument was presented.
• Rule 45, Section 1, Rules of Court — Limits petitions for review on certiorari to questions of law. Applied to note that the petition raised factual issues outside the Court's jurisdiction, though the Court nevertheless affirmed the lower courts' findings.

Perlas-Bernabe (Chairperson), Inting, Gaerlan, and Rosario, JJ., concurred.