Valencia vs. Locquiao

Under the Old Civil Code (Civil Code of Spain of 1889), acceptance is not a requisite for the validity of donations propter nuptias, and the formal requirements for acceptance applicable to ordinary donations do not apply to such donations. Actions for reconveyance of property based on fraud prescribe in ten years from the issuance of the certificate of title or execution of the deed, and may also be barred by laches where there is unreasonable delay in asserting rights coupled with prejudice to the defendant.

The case involves a dispute over a parcel of land in Urdaneta, Pangasinan originally owned by spouses Herminigildo and Raymunda Locquiao. In 1944, during the Japanese occupation, the spouses executed a donation propter nuptias (Inventario Ti Sagut) in favor of their son Benito and his prospective bride Tomasa Mara. The donation was registered in 1970, and Transfer Certificate of Title No. 84897 was issued in the donees' names. Decades later, the donors' other heirs challenged the validity of the donation and the title, leading to consolidated actions for annulment of title and ejectment.

• Spouses Herminigildo and Raymunda Locquiao were the original owners of a 4,876-square meter parcel of land in Urdaneta, Pangasinan, covered by Original Certificate of Title No. 18383 issued on October 3, 1917.
• On May 22, 1944, the spouses executed a deed of donation propter nuptias entitled Inventario Ti Sagut written in the Ilocano dialect, donating four parcels of land (including the subject property), a male cow, and a one-third portion of their conjugal house to their son Benito Locquiao and his prospective bride Tomasa Mara in consideration of their impending marriage.
• Benito Locquiao and Tomasa Mara were married on June 4, 1944, and the fact of their marriage was inscribed at the back of Original Certificate of Title No. 18383.
• Herminigildo Locquiao died on December 15, 1962, and Raymunda Locquiao died on January 9, 1968, leaving six children as heirs: Benito, Marciano, Lucio, Emeteria, Anastacia, and Romana (petitioner).
• With the permission of Benito and Tomasa, petitioner Romana Valencia took possession and cultivated the subject land; in 1977, her daughter petitioner Constancia Valencia took over possession and has remained there since.
• On May 15, 1970, Benito and Tomasa registered the Inventario Ti Sagut with the Register of Deeds of Pangasinan, resulting in the cancellation of Original Certificate of Title No. 18383 and the issuance of Transfer Certificate of Title No. 84897 in their names.
• On March 18, 1973, the heirs of the Locquiao spouses executed a Deed of Partition with Recognition of Rights, distributing twelve parcels of land among only three of the heirs and explicitly excluding the subject land, with the document stating that Benito, Marciano, and the heirs of Lucio had already received their shares by virtue of previous donations and conveyances.
• On June 12, 1976, the heirs executed a Deed of Compromise Agreement settling disputes over two other lots, wherein all signatories, including Romana Valencia, confirmed the stipulations of the 1973 deed of partition and waived rights to properties previously donated or conveyed.
• Petitioners filed the complaint for annulment of title on December 23, 1985, alleging that the transfer certificate was fraudulently issued, the Inventario Ti Sagut was spurious, the notary public lacked authority, and the donation lacked written acceptance as required by law.

• The Inventario Ti Sagut is spurious and falsified, evidenced by a certification from the Records Management and Archives Office showing no notarial record for 1944 for the notary public who purportedly notarized the document.
• The notary public who notarized the deed lacked authority to do so, rendering the document invalid.
• The donation failed to observe the form required by law because there was no written acceptance by the donees on the document itself or in a separate public instrument, citing Article 633 of the Old Civil Code applicable to ordinary donations.
• The Deed of Partition and the Deed of Compromise Agreement were improperly admitted in evidence because respondent Tomasa Mara failed to properly identify them during trial, merely stating she knew about them without actual identification.
• The action for annulment of title is imprescriptible, or alternatively, the prescriptive period should be reckoned from the discovery of the alleged fraud rather than from the execution of the deed or issuance of the title.

• The mere absence of notarial records does not prove the non-existence or spuriousness of the challenged document; failure to file a copy with the archives is merely a ground for disciplining the notary, not for invalidating the document.
• The donation propter nuptias is valid and enforceable; under Article 1330 of the Old Civil Code, acceptance is not necessary for the validity of such donations, and even under the New Civil Code, implied acceptance suffices.
• The Deed of Partition and Deed of Compromise Agreement are public documents duly notarized, admissible without further proof of due execution, and conclusive as to their contents absent clear and convincing evidence to the contrary.
• The action is barred by prescription under Section 40 of Act No. 190 (Old Code of Civil Procedure), which requires actions for recovery of real property to be brought within ten years from accrual of the cause of action.
• The action is further barred by laches because petitioners had actual knowledge of the donation as early as 1973 when they executed the Deed of Partition, yet unreasonably delayed filing suit until 1985, causing prejudice to respondents.

• Procedural Issues:
  • Whether the Deed of Partition with Recognition of Rights and the Deed of Compromise Agreement were properly admitted in evidence by the trial court despite alleged failure of proper identification by witnesses.
• Substantive Issues:
  • Whether the donation propter nuptias (Inventario Ti Sagut) is authentic and valid.
  • Whether acceptance of the donation by the donees is required under the applicable law, and if so, in what form.
  • Whether the action for annulment of title is barred by prescription and/or laches.

• Procedural: The Court held that the petitioners' objection to the admissibility of the Deed of Partition and Deed of Compromise Agreement was belatedly raised, as no objection was made when the documents were formally offered in evidence pursuant to Section 36, Rule 132 of the Revised Rules of Court. Furthermore, being public documents duly notarized, they are admissible without further proof of their due execution and are conclusive as to the truthfulness of their contents in the absence of clear and convincing evidence to the contrary.
• Substantive:
  • The donation propter nuptias is authentic. The mere absence of notarial records or file copies in the archives does not prove falsification or lack of notarial authority. The subsequent acknowledgment of the donation in the 1973 Deed of Partition and 1976 Compromise Agreement—wherein petitioner Romana Valencia participated—confirms the existence and validity of the Inventario Ti Sagut.
  • Under Article 1330 of the Old Civil Code (applicable because the donation was executed in 1944, prior to the effectivity of the New Civil Code on August 30, 1950), acceptance is not necessary to the validity of donations propter nuptias. Even applying the New Civil Code, implied acceptance suffices under Article 129.
  • The action is barred by prescription. Under Section 40 of Act No. 190 (Old Code of Civil Procedure), the ten-year prescriptive period began to run in 1944 when the deed was executed, or alternatively, in 1970 when the title was registered and issued, making the 1985 filing clearly time-barred.
  • The action is also barred by laches. Petitioner Romana had actual knowledge of the donation in 1973 (Deed of Partition) and 1976 (Compromise Agreement) but delayed asserting her rights for eleven years until 1985, while respondents relied on the validity of the donation and the issued title, resulting in prejudice.

• Donation propter nuptias — Defined as donations made before the celebration of marriage, in consideration thereof, and in favor of one or both future spouses. Distinguished from ordinary donations in that under the Old Civil Code (Article 1330), acceptance by the donees is not necessary for validity, unlike ordinary donations which require acceptance in a public instrument.
• Intertemporal Law — Only laws existing at the time of the execution of a contract are applicable thereto, not later statutes, unless the latter are specifically intended to have retroactive effect. Thus, the Old Civil Code governs donations executed in 1944.
• Effect of Change of Sovereignty on Municipal Laws — Municipal laws, as distinguished from laws of political nature, are not abrogated by a change of sovereignty. The Old Civil Code remained in force during the Japanese occupation period.
• Constructive Notice by Registration — Registration of a deed in the public real estate registry constitutes constructive notice to the whole world of its contents and all interests, legal and equitable, included therein.
• Laches — The failure or neglect for an unreasonable and unexplained length of time to do that which, by exercising due diligence, could or should have been done earlier. The elements include: (1) conduct giving rise to the situation; (2) delay in asserting rights with knowledge of the conduct; (3) lack of notice to the defendant that the right would be asserted; and (4) injury or prejudice to the defendant.

• "The Old Civil Code and the Old Code of Civil Procedure, repealed laws that they both are notwithstanding, have not abruptly become mere quiescent items of legal history since their relevance do not wear off for a long time."
• "acceptance is not necessary to the validity of such gifts" (referring to Article 1330 of the Old Civil Code regarding donations propter nuptias).
• "It is settled that only laws existing at the time of the execution of a contract are applicable thereto and not later statutes, unless the latter are specifically intended to have retroactive effect."
• "The failure of the notary public to furnish a copy of the deed to the appropriate office is a ground for disciplining him, but certainly not for invalidating the document or for setting aside the transaction therein involved."

• Spouses Santiago v. Court of Appeals (317 Phil. 400) — Cited for the rule that failure of a notary public to furnish a copy of the deed to the appropriate office is ground for disciplining the notary but not for invalidating the document or setting aside the transaction.
• Gerales v. Court of Appeals (G.R. No. 85909) — Cited for the rule that public documents are admissible in evidence without further proof of their due execution and are conclusive as to the truthfulness of their contents absent clear and convincing evidence to the contrary.
• Co Kim Cham v. Valdez Tan Keh and Dizon (75 Phil. 371) — Cited for the principle that municipal laws are not abrogated by a change of sovereignty.
• Ebero v. Canizares (79 Phil. 152) — Cited for the holding that the Old Civil Code was in force during the Japanese occupation period.
• Philippine Virginia Tobacco Administration v. Gonzalez (G.R. No. 34628) — Cited for the rule that only laws existing at the time of contract execution apply, not later statutes.
• Garcia v. Court of Appeals (G.R. Nos. L-48971 & 49011) — Cited for the rule that registration of a deed constitutes constructive notice to the whole world.
• Caro v. Court of Appeals (180 SCRA 402) — Cited for the ten-year prescriptive period for reconveyance of property registered through fraud.
• Metropolitan Waterworks and Sewerage System v. Court of Appeals (G.R. No. 126000) — Cited for the enumeration of the elements of laches.
• Chan Sui Bi v. Court of Appeals (G.R. No. 129507) — Cited for the principle that the Supreme Court is not a trier of facts and will not analyze, assess, or weigh evidence anew.

• Article 1327, Old Civil Code — Defines donations propter nuptias as those bestowed before marriage in consideration thereof upon one or both spouses.
• Article 1330, Old Civil Code — Provides that acceptance is not necessary to the validity of donations propter nuptias.
• Article 633, Old Civil Code — Requires acceptance in ordinary donations to appear in a public instrument (distinguished from donations propter nuptias).
• Section 40, Act No. 190 (Old Code of Civil Procedure) — Prescribes a ten-year period for actions for recovery of title to or possession of real property.
• Article 126, New Civil Code — Defines donations propter nuptias.
• Article 129, New Civil Code — Provides that express acceptance is not necessary for the validity of donations propter nuptias under the New Civil Code.
• Section 36, Rule 132, Revised Rules of Court — Requires objection to documentary evidence to be made at the time it is formally offered.