Spouses Garrido and Daguro vs. Court of Appeals

The heirs of a donee have no legal personality to question the violation of a condition imposed by the donor in a deed of donation; the right to revoke the donation belongs to the donor and may be transmitted to the donor's heirs, not to the donee's heirs. Additionally, a document is not "newly discovered evidence" warranting a new trial unless the offering party exercised reasonable diligence in procuring it before or during trial.

Tomas Hingco, a widower, originally owned Lot 209 of the Dingle Cadastre, Iloilo. He married Consolacion Rondael, a widow with a daughter, Magdalena Rondael. In 1947, Hingco donated one-half of Lot 209 to his stepdaughter Magdalena, subject to the condition that she could not sell, transfer, or cede the same. Upon the deaths of Hingco and Consolacion, the entire Lot 209 was registered in Magdalena's name under Transfer Certificate of Title No. T-13089. The property at issue, Lot 209-A, was subject to the prohibitive condition from the original donation.

Tomas Hingco, a widower, originally owned Lot 209 of the Dingle Cadastre, Iloilo. He married Consolacion Rondael, a widow who had a daughter, Magdalena Rondael. In 1947, Hingco donated one-half of Lot 209 to his stepdaughter Magdalena, subject to the condition that she could not sell, transfer, or cede the same. When Hingco died, Consolacion inherited the remaining half, which in turn passed to Magdalena upon Consolacion's death. The entire Lot 209 was then registered in Magdalena's name under Transfer Certificate of Title No. T-13089.

In 1973, Magdalena sold a portion of Lot 209 (Lot 209-B) to Mariano Platinos and Florida Macahilo. The remaining portion, Lot 209-A, with an area of 343 square meters, became the subject of this litigation. In 1976, Lorenzo Daguro, Magdalena's husband, died. Magdalena then filed a petition before the Court of First Instance of Iloilo to cancel the lien prohibiting her from disposing of Lot 209-A, citing her need for money for subsistence and medical expenses as she was then in her 80s and sickly. Her deposition on oral examination was taken on January 24, 1979.

On August 17, 1978, during the pendency of her petition, Magdalena executed a Conditional Deed of Sale of Lot 209-A in favor of respondent spouses Rufino and Conrada Suplemento, "subject to the lien subsisting and annotated on the face of the Certificate of Title." The deed stipulated that Magdalena would bear the cost of canceling the lien, and that if the lien was not cancelled, the amount already paid would be refunded. Of the P19,000.00 consideration, only P3,000.00 was to be paid pro rata monthly for ten years, commencing one year from the date of the deed.

On January 24, 1979, the petition for cancellation of encumbrance was denied because the ground cited was not among those allowed by Section 112 of Act 496, and Magdalena failed to produce the deed of donation containing the alleged restriction. Nonetheless, on July 19, 1979, Magdalena executed, with the conformity of her husband, a Deed of Absolute Sale covering Lot 209-A in favor of the Suplementos, notarized on the same date. Magdalena died on April 13, 1982, and on December 2, 1982, TCT No. T-108689 was issued in the name of the Suplementos.

Magdalena had two daughters, but only one was still living: Coloma Daguro, married to Alberto Garrido, the petitioners herein, who were based in Davao City and visited Magdalena only on occasions. In February 1984, Alberto Garrido visited the Suplementos in the house where Magdalena used to live, wanting to find out if the taxes on the house were being paid. The respondents showed him the Deed of Absolute Sale signed by his parents-in-law, and it was only then that he learned Lot 209-A no longer belonged to his in-laws.

On October 28, 1985, petitioners filed a complaint before the Regional Trial Court of Iloilo City for annulment of the Deed of Absolute Sale, reconveyance, and damages, claiming the deed was fictitious since Magdalena's signature "appears to have been traced" and Lorenzo Daguro's signature was a forgery since he died prior to the execution thereof, or on October 9, 1976. The trial court, relying on Magdalena's deposition, found that she wanted to sell and did in fact sell Lot 209-A to the Suplementos. The court also found that the genuineness of Lorenzo Daguro's signature was not germane to the validity of the Deed of Absolute Sale, as his signature was not necessary to convey title to the paraphernal property of Magdalena. The trial court held that no evidence was adduced by respondents to show payment of any installment of the balance of the purchase price to Magdalena before her death or to her heir, Coloma.

• Lack of Personality: Petitioners contended that the appellate court erred in holding that they have no personality to assail the Absolute Deed of Sale and the genuineness of the signature of Magdalena Rondael.
• Exceeding Jurisdiction: Petitioners asserted that the issue raised in the trial court was whether Magdalena Rondael could sell the property despite the prohibition in the deed of donation, and that in ruling they were incapacitated to question the non-observance of the condition, the respondent court went beyond the issue and exceeded its jurisdiction.
• Newly Discovered Evidence: Petitioners submitted that the finding of the appellate court that Magdalena's signature was genuine had been overtaken by events, citing NBI Questioned Document Report No. 413-791 dated July 23, 1991, purporting to show that the questioned signature and the standard/sample signatures of Magdalena were not written by one and the same person, hence, a forgery.

• Validity of the Sale: Respondents maintained that the Deed of Absolute Sale was valid, having been executed by Magdalena with the conformity of her husband and notarized on the same date.
• Genuineness of Signature: Respondents relied on the trial court's finding, based on Magdalena's deposition, that she wanted to sell and did in fact sell Lot 209-A to them, and that the alleged discrepancy between her signatures did not exist.

• Personality to Question the Donation's Condition: Whether petitioners, as heirs of the donee, have legal personality to question the violation of the condition imposed by the donor in the deed of donation.
• Newly Discovered Evidence: Whether the NBI Questioned Document Report presented for the first time before the Supreme Court qualifies as newly discovered evidence warranting a new trial.

• Personality to Question the Donation's Condition: No. Petitioners have no personality to question the violation of the restriction because they are not heirs of the donor. Under Article 764 of the Civil Code, the right to revoke a donation for non-compliance with conditions may be transmitted to the heirs of the donor and may be exercised against the heirs of the donee.
• Newly Discovered Evidence: No. The NBI report does not qualify as newly discovered evidence because petitioners failed to exercise reasonable diligence in procuring such evidence before or during trial, as required by Section 1, paragraph (b), Rule 37 of the Rules of Court.

• Personality to Question the Donation's Condition: When the donee fails to comply with any of the conditions imposed by the donor, it is the donor who has the right to impugn the validity of the transaction affecting the donated property, conformably with Article 764 of the Civil Code. The right to revoke may be transmitted to the heirs of the donor and may be exercised against the heirs of the donee, and the action prescribes four years after the violation of the condition. Petitioners' lack of capacity to question the non-compliance with the condition is intimately connected with the issue regarding the validity of the sale on account of the prohibition in the deed of donation. The Court established the rule that an unassigned error closely related to an error properly assigned, or upon which the determination of the question properly assigned is dependent, may be considered by the appellate court.

• Newly Discovered Evidence: The NBI report was never adduced before the lower courts and was presented for the first time only before the Supreme Court. It is not newly discovered evidence within the purview of Section 1, paragraph (b), Rule 37 of the Rules of Court. Petitioners should have had the signature of Magdalena Rondael on the deed of sale examined when the case was still with the trial court. For evidence to be regarded as "newly discovered" for the purpose of granting a new trial, the following requisites must concur: (a) the evidence had been discovered after trial; (b) the evidence could not have been discovered and produced during trial even with the exercise of reasonable diligence; and (c) the evidence is material and not merely corroborative, cumulative, or impeaching and is of such weight that if admitted would probably alter the result. The NBI report fails the second requirement because petitioners did not exercise reasonable diligence. By their own admission, the Fiscal sought NBI assistance only after the trial of the case. Moreover, when the City Prosecutor first requested the NBI for a handwriting examination, the initial response was that "no definite opinion can be rendered on the matter due to lack of sufficient basis necessary for a scientific comparative examination," showing that petitioners did not submit adequate documents at the first instance.

• Genuineness of Signature: The Court accorded finality to the finding of the respondent court, supported by substantial evidence, that the alleged discrepancy between the signature of Magdalena Rondael appearing on the Deed of Absolute Sale and her signatures on other documents does not exist. Having alleged forgery, petitioners had the burden of proof, which they utterly failed to discharge. The Deed of Absolute Sale is a notarized document which carries the evidentiary weight conferred upon such public document with respect to its due execution.

• Right to Revoke a Donation (Article 764, Civil Code) — When a donee fails to comply with conditions imposed by the donor, the right to revoke the donation belongs to the donor and may be transmitted to the heirs of the donor, exercisable against the heirs of the donee. The action prescribes four years after the violation of the condition. In this case, petitioners, as heirs of the donee, lacked personality to question the violation of the condition because that right belonged exclusively to the donor or the donor's heirs.

• Newly Discovered Evidence (Section 1, par. (b), Rule 37, Rules of Court) — For evidence to qualify as newly discovered, three requisites must concur: (a) the evidence had been discovered after trial; (b) the evidence could not have been discovered and produced during trial even with the exercise of reasonable diligence; and (c) the evidence is material and not merely corroborative, cumulative, or impeaching and is of such weight that if admitted would probably alter the result. The essential consideration is not the time the evidence first sprang into existence or came to the party's knowledge, but whether the offering party exercised reasonable diligence in producing or locating such evidence before or during trial. The NBI report failed this test because petitioners sought NBI assistance only after trial.

• Evidentiary Weight of Notarized Documents — A notarized document carries the evidentiary weight conferred upon public documents with respect to their due execution. Having alleged forgery, the party making the allegation bears the burden of proof.

• "When the donee fails to comply with any of the conditions imposed by the donor, it is the donor who has the right to impugn the validity of the transaction affecting the donated property, conformably with Art. 764 of the Civil Code, which provides that the right to revoke may be transmitted to the heirs of the donor and may be exercised against the heirs of the donee, and the action prescribes four years after the violation of the condition." — This passage states the ratio decidendi on the issue of petitioners' lack of personality to question the violation of the donation's condition.

• "At the pitch of these requirements is that what is essential is not so much the time when the evidence offered first sprang into existence nor the time when it first came to the knowledge of the party now submitting it; rather, that the offering party had exercised reasonable diligence in producing or locating such evidence before or during trial but had nonetheless failed to secure it." — This passage articulates the controlling principle for determining whether evidence qualifies as newly discovered for purposes of a new trial.

• "Having alleged forgery, petitioners had the burden of proof. Here, they utterly failed." — This passage establishes the allocation of the burden of proof in cases where forgery is alleged against a notarized document.

• Medida vs. Court of Appeals, G.R. No. 98334, 8 May 1992, 208 SCRA 887 — Cited for the rule that an unassigned error closely related to an error properly assigned, or upon which the determination of the question properly assigned is dependent, may be considered by the appellate court.
• Roman Catholic Archbishop of Manila vs. Court of Appeals, G.R. No. 77425, 19 June 1991, 198 SCRA 300 — Cited for the same rule regarding consideration of unassigned errors.
• Philippine Commercial and Industrial Bank vs. Court of Appeals, No. L-34959, 18 March 1988, 159 SCRA 24 — Cited for the same rule regarding consideration of unassigned errors.
• Tumang vs. Court of Appeals, G.R. No. 82072, 17 April 1989, 172 SCRA 328 — Cited for the requisites of newly discovered evidence for purposes of granting a new trial.
• Velasco vs. Ortiz, G.R. No. 51973, 16 April 1990, 184 SCRA 303 — Cited for the requisites of newly discovered evidence for purposes of granting a new trial.

• Article 764, Civil Code — Provides that the right to revoke a donation for non-compliance with conditions may be transmitted to the heirs of the donor and may be exercised against the heirs of the donee, with the action prescribing four years after the violation of the condition. Applied to deny petitioners' personality to question the sale of the donated property.
• Section 1, par. (b), Rule 37, Rules of Court — Defines newly discovered evidence as a ground for new trial. Applied to reject the NBI report presented for the first time on appeal because petitioners failed to exercise reasonable diligence in procuring it during trial.
• Section 112, Act 496 — The ground cited for cancellation of the encumbrance was not among those allowed by this provision, leading to the denial of Magdalena's petition to cancel the lien.

Davide, Jr., Quiason, and Kapunan, JJ., concurred. Cruz, J., was on leave.