Sinco vs. Longa

A judicially approved guardian's sale stands against collateral attack for alleged fraud where the fraud is not proved to have been participated in by the purchasers and where the petition invoked the court's statutory power to authorize sale for reinvestment, jurisdiction depending on the averments and not on their truth.

The Sinco family owned hacienda Rosario in Bais, Oriental Negros, held successively by Don Rafael Sinco y Librado and Escolastico G. Sinco and thereafter by his widow, children, and grandchildren. Agapito Longa and Trinidad Diago, predecessor of the Longa defendants, were long-term lessees of the hacienda and mortgage creditors thereof. Sales of a minor's estate for reinvestment and maintenance were governed by section 569 of the Code of Civil Procedure, requiring a guardian's petition and judicial approval with notice to next of kin.

Hacienda Rosario was originally owned by Don Rafael Sinco y Librado and passed to his son Escolastico G. Sinco, who died before 1901 leaving widow Saturnina Lopez and three children Sergio, Maria Paz, and Coloma Sinco. Coloma died in 1904 leaving Vicente, Pilar, and Desamparados, the plaintiffs, while Sergio and Maria Paz survived. To liquidate about P14,000 in estate debts, the widow and three children in 1901 leased the hacienda for seven years at P3,000 annual rental to Agapito Longa and Trinidad Diago, widow, with lessees assuming the debts and applying rent thereto; the lease was extended in July 1903 for two more years at the same rent and on October 7, 1907, after Coloma's death, for one further year, P1,500 of the P3,000 rent being advanced for the lessors' pressing needs.

Saturnina Lopez died in August 1909, and Sergio Sinco, pressed to support a numerous family while rents were tied up, proposed to sell his undivided third to Agapito Longa. Longa, with kinswoman Trinidad Diago, agreed to buy only if Maria Paz would also sell her share and if the minors' third could likewise be sold by the guardian with court approval, the Tabacalera Company, looked to for purchase funds, being averse to lending on an undivided third. By deed dated February 12, 1910 (Exhibit 1), Sergio and Maria Paz conveyed their two undivided thirds on a declared total valuation of P23,600 for P15,733.32 acknowledged as received, executing contemporaneously agreements to sell the remaining third if adjudged theirs (Exhibit G), to hold the sold two-thirds unaffected by any decision on title (Exhibit A), and to interpose no obstacle to sale of the minors' third with liability in damages (annotation 335, Exhibit C). On the same date Longa acknowledged receipt of P10,000 for cancellation of a supposed lease to 1915 as to Sergio and Maria Paz (Exhibit H) and, as attorney-in-fact of Trinidad Diago, receipt of P7,333.33 as the two-thirds share of an P11,000 mortgage, leaving P3,666.66 stated as encumbering the minors' third (Exhibit I), the mortgage having originated in a P8,800 obligation at 10% per annum executed by Saturnina, Sergio, and Maria Paz and joined in by guardian Emilio Tevez under court authority of February 3, 1909.

Thereafter guardian Emilio Tevez petitioned the Court of First Instance on November 7, 1910 for leave to sell the minors' undivided third, alleging encumbrance by the proportional mortgage share, advance receipt of rents to 1915 leaving P21,000 in encumbrances with mortgage, intestate succession from the grandmother and father, total value of P33,600 leaving P4,200 net to the minors, sale by the adult co-owners for P22,400, lack of cash for the minors' subsistence and education with one maintained at Silliman Institute by a kinsman, and advantage in obtaining liquid capital at interest free of mortgage and rent. On November 16, 1910 the court authorized the sale, reciting personal appearance and ratification by co-owners and next of kin Sergio Sinco, Maria Paz Sinco, and Tiburcio Chavez, and testimony of 16-year-old Vicente Sinco, brought from Silliman Institute; on November 17, 1910 the guardian conveyed to the Longas (Exhibit 2). The original guardianship records were later destroyed by fire, leaving only copies of the petition and decree.

On July 16, 1926 plaintiffs sued to annul the 1910 sale, reconvey the third interest or pay its just value, and recover P160,000 damages with interest and costs. The trial court found for plaintiffs and ordered partition and monetary awards totaling P2,000 for machinery and improvements, livestock or P833.33, and P71,162.08 for harvested produce, from which defendants appealed.

• Fraud and Conspiracy: Petitioner argued that the sale was tainted by fraud and imposition on the court, with annotation 335 of Exhibit C, by which Sergio and Maria Paz agreed to interpose no obstacle to sale of the minors' share, showing Agapito Longa's purpose to tie the hands of the uncle and aunt who should have advised for the minors as preparatory to a conspiracy to obtain the children's share.
• Irregularity and Want of Jurisdiction: Petitioner maintained that the order of November 16, 1910 authorizing the guardian's sale was irregular and beyond the jurisdiction of the court, particularly for want of publication over the full period required by law.

• Fraud Attributable to Purchasers: Whether the 1910 guardian's sale of the minors' undivided third may be annulled for fraud and conspiracy where imposition on the court is claimed but participation of the Longa purchasers is not clearly proved.
• Validity and Jurisdiction of Sale Order: Whether the November 16, 1910 order authorizing the guardian to sell for reinvestment was irregular and beyond jurisdiction so as to void the sale.

• Fraud Attributable to Purchasers: No. Annulment was denied because alleged fraud was not brought home to the purchasers and stale charges resting chiefly on an interested participant's testimony after 17 years did not overcome the presumption of innocence.
• Validity and Jurisdiction of Sale Order: No. The order was valid, the petition having stated a case for sale for reinvestment under section 569 of the Code of Civil Procedure, jurisdiction resting on averments rather than their truth, with personal appearance of next of kin curing publication defects.

• Fraud Attributable to Purchasers: Admittedly the petition was untrue and uncandid in exaggerating the minors' necessities, who had other property for subsistence, and the sale proved unwise especially after establishment of Bais Sugar Central greatly increased values, with sinister forces possibly at work. Nevertheless, conspiracy instigated by the Longas was not accepted as the true interpretation, the testimony of Sergio Sinco being rambling, confused, given nearly seventeen years later by an ashamed participant naturally anxious to shift blame, while the real danger had been the uncle and aunt who opposed the minors' inheritance and were anxious to be rid of the property. Annotation 335 did not prove Longa's conspiracy, Longa's name not appearing as beneficiary and the instrument being consistent with anxious sellers seeking a purchaser, while guardian Tevez, Trinidad Diago, and others were dead and Agapito Longa in Spain, requiring clear proof beyond reasonable doubt before disturbing the dead or imputing fraud to the living after lapse of time.
• Validity and Jurisdiction of Sale Order: The petition clearly alleged insufficient income to maintain and educate the wards, benefit from sale, and existence of encumbrances, stating a case for sale of guardianship estate for reinvestment as contemplated in section 569 of the Code of Civil Procedure. Even admitting untruth of those statements, jurisdiction was unaffected, since jurisdiction rests on averments and not their truth, pursuant to cited authority. The publication objection lost force because the order recited personal appearance in court by the co-owners and next of kin and testimony of the eldest minor, satisfying the protective purpose of notice.

• Fraud not presumed after great lapse of time — Fraud or breach of trust ought not lightly to be imputed to the living, for the legal presumption favors innocence, and still less to the dead who cannot answer, unless evidence of fraud is clear beyond reasonable doubt, since time obscures human evidence and exact proof of minute circumstances cannot reasonably be required. Applied to reject annulment based principally on Sergio Sinco's testimony seventeen years after the sale when the guardian and other actors were dead.
• Jurisdiction determined by averments, not their truth — Where a guardian's petition alleges facts invoking statutory power to authorize sale for reinvestment, the court's jurisdiction attaches upon those averments and is not defeated even if the averments are later shown untrue. Applied to sustain the November 16, 1910 order under section 569 of the Code of Civil Procedure despite exaggerated necessities and encumbrances.
• Purchaser not affected by guardian's fraud unless brought home to purchaser — Imposition on the court in guardianship proceedings, even if admitted arguendo, does not void title in the hands of purchasers absent proof connecting them to the fraud. Applied to absolve the Longas where sinister influence, if any, emanated from the minors' relatives and guardian rather than the buyers.

• "But lenght of time necessarily obscures all human evidence; and as it thus removes from the parties all the immediate means to verify the nature of the original transactions, it operates by way of presumption, in favor of innocence, and against imputation of fraud." — States the evidentiary presumption against stale fraud charges, relied upon to discredit a 17-year-delayed attack resting on a single interested witness.
• "Fraud, or breach of trust, ought not lightly to be imputed to the living; for, the legal presumption is the other way; and as to the dead, who are not here to answer for themselves, it would be the height of injustice and cruelty, to disturb their ashes, and violate the sanctity of the grave, unless the evidence of fraud be clear, beyond a reasonable doubt." — Provides the canonical standard for proving historic fraud, applied to require clear proof before annulling a court-approved sale.
• "because the jurisdiction of the court rests on the averments of the petition and not upon the truth of those averments (28 C. J., 1178; Scott vs. Gypsy Oil Co., 112 Okla., 13; 239 Pac., 887)." — Defines the jurisdictional test sustaining the guardianship sale order despite admitted falsity in the petition's allegations of necessity and encumbrance.

• Prevost vs. Gratz, 6 Wheat. [U.S.], 481, 498 — Quoted through Mr. Justice Story for the rule that lapse of time creates a presumption of innocence against imputation of fraud and demands clear proof beyond reasonable doubt, especially as to the dead; followed as controlling reasoning to reject the fraud claim.
• Scott vs. Gypsy Oil Co., 112 Okla., 13; 239 Pac., 887 — Cited with 28 C.J. 1178 for the proposition that jurisdiction rests on averments of the petition and not their truth; followed to uphold the court's power to authorize the guardian's sale.

• Section 569, Code of Civil Procedure — Authorizes sale of a portion of guardianship estate for reinvestment where income is insufficient to maintain and educate the ward and sale is for the ward's benefit; applied to hold that the guardian's petition stating insufficient income, encumbrances, and benefit stated a jurisdictionally sufficient case for the November 16, 1910 order.

Johnson, Malcolm, Ostrand, Johns, Romualdez and Villa-Real, JJ., concur.