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Page 1 of 21 TRUSTS (Rule 98 Parol Evidence Rule 130 Sec 9; Arts. 1440-1457) 1. Concept SOTTO vs. TEVES FACTS: Subject of the plaintiffs'action for declaration of ownership and/or reconveyance, and for the recovery of possession, rentals, damages and attorney's fees, are five (5) parcels of land, all located in Cebu City. Properties originally belonged to the conjugal partnership of the spouses FlorentinoRallos and Maria Fadullon. When FlorentinoRallos died, the parcels of land in question, together with the other properties comprising the estate of the deceased, descendedto his sole heirs, his widow, Maria Fadullon, and two children, named Concepcion and Carmen Rallos. The lawyer to whom the Rallos heirs entrusted the settlement of the estate was Atty. Filemon Sotto. Shortly after the closure of the probate proceeding in 1913, Atty. Sotto married Carmen Rallos. Carmen died in 1945 without leaving any issue. Concepcion died later leaving many children. Maria Fadullon predeceased her two daughters. Atty. Sotto died intestate on October 10, 1966. Competing for the ownership of the five lots are the direct descendants and blood relatives of FlorentinoRallos and Maria Fadullon, opposed by the administrator of the intestate estate of Atty. Sotto. The grandchildren of FlorentinoRallos and Maria Fadullon, some of whom are assisted by their spouses, are the plaintiffs in this case. Defendant administrator represents Atty. Sotto's children out of wedlock. It is claimed by the defendant that Atty. Sotto was at the time of his death the owner of the five lots in question. In life, Atty. Filemon Sotto was a very prestigious man. He wielded tremendous social and political influence. Successively, he was municipal councilor, vice-president of Cebu City, Assemblyman, Senator and Delegate to the Constitutional Convention of 1934. When his life, however, was almost at an end, he was declared incompetent. All along, the direct descendants and blood relatives of FlorentinoRallos had rested on the belief that the properties in question, which are the fruits of the sweat and toil of their grandfather, would one day be delivered unto them. The revelation of Cesar Sotto, however, led the plaintiffs to the discovery that all the properties in question were now titled in the name of Atty. Sotto. and were in danger of falling into the hands of his children out of wedlock, who are total strangers to the spouses Rallos and Fadullon. Upon such discovery, the plaintiffs initiated the present lawsuit forthwith." On June 13, 1967, the herein private respondents(heirs of Concepcion Rallos)filed suit in the Court of First Instance of Cebu

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TRUSTS (Rule 98 Parol Evidence Rule 130 Sec 9; Arts. 1440-1457)1. ConceptSOTTO vs. TEVESFACTS:Subject of the plaintiffs'action for declaration of ownership and/or reconveyance, and for the recovery of possession, rentals, damages and attorney's fees, are five (5) parcels of land, all located in Cebu City. Properties originally belonged to the conjugal partnership of the spouses FlorentinoRallos and Maria Fadullon. When FlorentinoRallos died, the parcels of land in question, together with the other properties comprising the estate of the deceased, descendedto his sole heirs, his widow, Maria Fadullon, and two children, named Concepcion and Carmen Rallos. The lawyer to whom the Rallos heirs entrusted the settlement of the estate was Atty. Filemon Sotto.Shortly after the closure of the probate proceeding in 1913, Atty. Sotto married Carmen Rallos. Carmen died in 1945 without leaving any issue. Concepcion died later leaving many children. Maria Fadullon predeceased her two daughters. Atty. Sotto died intestate on October 10, 1966.Competing for the ownership of the five lots are the direct descendants and blood relatives of FlorentinoRallos and Maria Fadullon, opposed by the administrator of the intestate estate of Atty. Sotto. The grandchildren of FlorentinoRallos and Maria Fadullon, some of whom are assisted by their spouses, are the plaintiffs in this case. Defendant administrator represents Atty. Sotto's children out of wedlock. It is claimed by the defendant that Atty. Sotto was at the time of his death the owner of the five lots in question.In life, Atty. Filemon Sotto was a very prestigious man. He wielded tremendous social and political influence. Successively, he was municipal councilor, vice-president of Cebu City, Assemblyman, Senator and Delegate to the Constitutional Convention of 1934. When his life, however, was almost at an end, he was declared incompetent. All along, the direct descendants and blood relatives of FlorentinoRallos had rested on the belief that the properties in question, which are the fruits of the sweat and toil of their grandfather, would one day be delivered unto them. The revelation of Cesar Sotto, however, led the plaintiffs to the discovery that all the properties in question were now titled in the name of Atty. Sotto. and were in danger of falling into the hands of his children out of wedlock, who are total strangers to the spouses Rallos and Fadullon. Upon such discovery, the plaintiffs initiated the present lawsuit forthwith."On June 13, 1967, the herein private respondents(heirs of Concepcion Rallos)filed suit in the Court of First Instance of Cebu against petitioner Marcelo Sotto, as administrator of the intestate estate of Filemon Sotto, for the recovery of possession and ownership of the 5 parcels of land described in the complaint, with damages. The complaint was based mainly upon the theory that a trust relation was established and created with respect to the said properties, with Atty. Filemon Sotto as trustee and as cestuisque trust, his mother-in-law, Maria FadullonVda. deRallos; his wife, Carmen Rallos; and his sister-in-law, Concepcion Rallos (predecessor in interest of herein private respondents); and that in gross violation of the trust reposed upon him by Concepcion Rallos and after her death, by her heirs, the said Atty. Filemon Sotto, through sheer manipulation, fraudulent acts and means, non-existent and void decrees, fictitious sales and transfers, succeeded in causing the transfer of the ownership of the properties to the name of his wife Carmen Rallos, and finally to his name alone.It is alleged that Atty. Filemon Sotto, having married Carmen Rallos, thereby virtually making him a member of the Rallos family, was looked upon as the head of the Rallos family to look after the properties inherited from the deceased FlorentinoRallos including the 5 parcels of land hereinbefore mentioned, thereby establishing a trust relation with Don Filemon Sotto as trustee of the said properties for the benefit of his mother-in-law Maria FadullonVda. deRallos, his wife Carmen Rallos de Sotto and sister-in-law Concepcion Rallos and the heirs of the latter, as cestuisque trust; Answering the complaint, petitioner Marcelo Sotto denied that there was any trust relation between Don Filemon Sotto on one hand and Maria FadullonVda. deRallos, Carmen Rallos and Concepcion Rallos on the other; that granting that such relationship existed between Don Filemon Sotto and Concepcion Rallos, such a relationship could not have endured until the death of Don Filemon Sotto; ISSUE:Whether or not Don Filemon Sotto became a co-trustee by virtue of his subsequent marriage to Carmen Rallos.HELD:The Court that Atty. Sotto can be regarded as the constructive trustee of his wife and of the widow and descendants of FlorentinoRallosRATIO:Under the law on Trusts, it is not necessary, as petitioner insists, that the document expressly state and provide for the express trust, for no particular words are required for the creation of an express trust, it being sufficient that a trust is clearly intended. (Art. 1444, N.C.C.) Petitioner contends that the Court of Appeals erred in finding that Don Filemon Sotto became a co-trustee by virtue of his subsequent marriage to Carmen Rallos. Petitioner, while admitting that as a lawyer some form of trust devolved upon the shoulders of Filemon Sotto The trust on the shoulder of Filemon Sotto as the family lawyer in the intestate proceedings of FlorentinoRallos was only coterminous with the duration of the proceedings itself. The trust on the shoulder of Filemon Sotto by virtue of his marriage to Carmen Rallos was only as much as the trust on the shoulders of the two husbands of Concepcion Rallos, Mariano Teves and Mariano Camara, and this trust is not the trust defined in our Civil Code on express trust." By reason of his marriage to Carmen Rallos, and on account of his prestige and tremendous social and political influence, Atty. Sotto enjoyed and exercised a personal, domestic, social, political and moral ascendancy and superiority not only over his wife but also over Maria Fadullon, Concepcion Rallos, and the latter's children. The evidence reveals that the Ralloses looked up to Atty. Sotto as protector and benefactor, as one on whom they could repose their trust and confidence and who would take care of the properties inherited from FlorentinoRallos, and on his part, Atty. Sotto acknowledged his position as protector of the rights and interests of the Rallos family. Petitioner assumes that the respondent Court of Appeals found the existence of an express trust between Atty. Filemon Sotto and the heirs of FlorentinoRallos, which is not correct. What the appellate court held is that Atty. Sotto can be regarded as the constructive trustee of his wife and of the widow and descendants of FlorentinoRallos.The relation between parties, in order to be a fiduciary relation" need not be legal, but may be moral, social, domestic or merely personal; and where by reason of kinship, business association, disparity in age or physical or mental condition or other reason, the grantee is in an especially intimate position with regard to another and the latter reposes a degree of trust and confidence in the former, confidential relationship exists which prohibits the one entrusted from seeking a selfish benefit for himself during the course of relationship, and affords a basis for imposing a constructive trust. (89 CJS Art. 151, pp. 1054-1057)Atty. Sotto's special relationship with the Rallos heirs inhibited him from any act or conduct that would put his interests above, or in direct collision with, the interests of those who had reposed their trust and confidence in him." 15Private respondents are entitled to the relief prayed for, which is for the reconveyance of the properties to them. Since tMariaFadullonVda.deRallos died in 1938, her pro-indiviso share in the properties then owned in co-ownership descended by intestacy to her daughters, Concepcion and Carmen. Upon Carmen's death in 1945 without issue, the properties devolved to Concepcion pursuant to their agreement in 1925 as testified to by PilarTeves. When Concepcion Rallos died, her heirs, who are now the private respondents, are entitled to these properties and should be declared owners thereof. They are also entitled to the fruits thereof, the rentals of the properties, including damages and attorney's fees as assessed by the appellate court, which we find just and reasonable.

2. ExpressRamos vs. RamosFACTS:Spouses Martin Ramos & Candida Tanate died and were survived by their 3 legitimate children named Jose, Agustin and Granada. Martin was also survived by his 7 natural children: Atanacia, Timoteo, Modesto, Manuel, Emiliano, Maria & Federico.Martin Ramos left considerable real estate to include Hacienda Calaza and Hacienda Ylaya, both located in Negros Occidental.Upon their father's death, his properties were left under the administration of Rafael Ramos, the younger brother of their father and their uncle. Rafael Ramos later gathered all the heirs saying he would return the administration of the properties. He turned over Hacienda Ylaya to Agustin Ramos and Hacienda Calaza to Jose Ramos.All said children continued to live in the same house of their father in Hacienda Ylaya, now under support of Agustin Ramos. Plaintiffs Modesto, Manuel and Maria eventually left house. Agustin supported plaintiffs where they asked money pertaining to their share in the produce of Hacienda Ylaya and received varied amounts. Jose Ramos gave plaintiffs also money as their shares. Upon Jose Ramos death, his widow Gregoria continued to give plaintiffs money pertaining to their shares. She however stopped doing so in 1951, telling them that the lessee Estanislao Lacson was not able to pay the lease rental.No accounting was made to plaintiffs by Jose Ramos, plaintiffs reposing confidence in their elder brother.Plaintiff Modesto was informed that a survey of the properties shall be conducted but he did not intervene since he was promised that Jose and Agustin would be the ones responsible to have it registered in the names of the heirs. But apparently, what happened include the following: A project of partition was submitted. It was signed by the legitimate children; by the 2 natural children, Atanacia and Timoteo, and by Timoteo Zayco in representation of the other 5 natural children who were minors. The conjugal hereditary estate was appraised at P74,984.93. It consisted of 18 parcels of land, some head of cattle and the advances to the legitimate children.It was agreed that Jose Ramos would pay the cash adjudications to Atanacia, Timoteo and Manuel, while Agustin would pay the cash adjudications to Modesto, Federico, Emiliano and Maria. It was further agreed that Jose and Agustin would pay their sister, Granada, the sums of P3,302.36 and P14,273.78, respectively.The estate had an appraised value of P74,985, or P37,492brepresented the estate of Martin Ramos. 1/3 was the free portion or P12,497. The shares of the 7 natural children were to be taken from that 1/3 free portion. Dividing P12,497 by seven gives a result of P1,783. The partition was made in accordance with the old Civil Code.Judge Richard Campbell approved the project of partition.Judge V. Nepomuceno asked the administrator to submit a report, complete with the supporting evidence, showing that the shares of the heirs had been delivered to them as required in the decision. In a manifestation, which was signed by Jose, Agustin, Granada, Atanacia and Timoteo, and by Timoteo Zayco, they acknowledged. However, no receipts were attached to the manifestation. Apparently, the manifestation was not in strict conformity with the terms of judge's order.Plaintiffs did not know that intestate proceedings were instituted for the distribution of the estate of their father. They never received any sum of money in cash the alleged insignificant sum of P1,7855 each. Plaintiffs only discovered later on that the property administered by their elder brother Jose had a Torrens Title in the name of his widow and daughter. They were then constrained to bring the present suit seeking for the reconveyance in their favor by defendants Gregoria and daughter Candida and husband Jose Bayot of their corresponding participations in said parcels of land in accordance with article 840.The petitioners action was predicated on the theory that their shares were merely held in trust by defendants. Nonetheless, no Deed of Trust was alleged and proven. Lower court dismissed the complaint on the ground of res judicata. The plaintiffs appealed and vigorously pressed on the Court their theory that they were acknowledged natural children and were grievously prejudiced by the partition and that the doctrine of res judicata should not bar their action.ISSUE: W/N plaintiffs action was barred by prescription, laches and res judicata to the effect that they were denied of their right to share in their fathers estate. HELD: Yes. Trial court's judgment is affirmed with the clarification that defendants' counterclaim is dismissed. No costsRATIO:The crucial issue is prescription. With it the question of res judicata and the existence of a trust are inextricably interwoven. Discussion on Trust:A trust is defined as the right, enforceable solely in equity, to the beneficial enjoyment of property, the legal title to which is vested in another, but the words 'trust' is frequently employed to indicate duties, relations, and responsibilities which are not strictly technical trusts.A person who establishes a trust is called the trust or; one in whom confidence is reposed is known as the trustee; and the person for whose benefit the trust has been created is referred to as the beneficiary. Trusts are either express or implied. Express trusts are created by the intention of the trust or of the parties. Implied trusts come into being by operation of law. No express trusts concerning an immovable or any interest therein may be proven by oral evidence. An implied trust may be proven by oral evidence. No particular words are required for the creation of an express trust, it being sufficient that a trust is clearly intended. Express trusts are those which are created by the direct and positive acts of the parties, by some writing or deed, or will, or by words either expressly or impliedly evincing an intention to create a trust. Implied trust are those which, without being expressed, are deducible from the nature of the transaction as matters of intent, or which are super induced on the transaction by operation of law as matters of equity, independently of the particular intention of the parties. They are ordinarily subdivided into resulting and constructive trusts A resulting trust is broadly defined as a trust which is raised or created by the act or construction of law, but in its more restricted sense it is a trust raised by implication of law and presumed always to have been contemplated by the parties, the intention as to which is to be found in the nature of their transaction, but not expressed in the deed or instrument of conveyance. On the other hand, a constructive trust is a trust raised by construction of law, or arising by operation of law; a trust not created by any words, either expressly or impliedly evincing a direct intention to create a trust, but by the construction of equity in order to satisfy the demands of justice. It does not arise by agreement or intention but by operation of law. If a person obtains legal title to property by fraud or concealment, courts of equity will impress upon the title a so-called constructive trust in favor of the defrauded party. A constructive trust is not a trust in the technical senseThere is a rule that a trustee cannot acquire by prescription the ownership of property entrusted to him, or that an action to compel a trustee to convey property registered in his name in trust for the benefit of the cestui qui trust does not prescribed, or that the defense of prescription cannot be set up in an action to recover property held by a person in trust for the benefit of another, or that property held in trust can be recovered by the beneficiary regardless of the lapse of time. This applies squarely to express trusts. The basis of the rule is that the possession of a trustee is not adverse. Not being adverse, he does not acquire by prescription the property held in trust.Discussion of Case:The plaintiffs did not prove any express trust in this case. The project of partition, the decision and the manifestation as to the receipt of shares negatives the existence of an express trust. Those public documents prove that the estate of Martin Ramos was settled in that proceeding and that adjudications were made to his seven natural children. A trust must be proven by clear, satisfactory, and convincing evidence. It cannot rest on vague and uncertain evidence or on loose, equivocal or indefinite declarations. As already noted, an express trust cannot be proven by parol evidence.Plaintiffs did not also specify the kind of implied trust contemplated in their action. We have stated that whether it is a resulting or constructive trust, its enforcement may be barred by laches. In the cadastral proceedings, which supervened after the closure of the intestate proceeding, the lots involved were claimed by Jose Ramos and Gregoria T. Ramos to the exclusion of the plaintiffs. After the death of Jose Ramos, the said lots were adjudicated to his widow and daughter. Transactions following this prove that the heirs of Jose Ramos had repudiated any trust which was supposedly constituted over Hacienda Calaza in favor of the plaintiffs. Under Act 190, whose statute of limitations applies to this case (Art. 116, Civil Code), the longest period of extinctive prescription was 10 years.Atanacia, Modesto and Manuel, all surnamed Ramos, were already of age in 1914. From that year, they could have brought the action to annul the partition. Maria and Emiliano reached the age of 21 in 1917. They could have brought the action. The actions were filed more than 40 years after it accrued. The delay was inexcusable. The instant action is unquestionably barred by prescription and res judicata. Plaintiffs contend that the partition was not binding on them. They ask that the case be remanded to the lower court for the determination and adjudication of their rightful shares. All those contentions would have a semblance of cogency and would deserve serious consideration if the plaintiffs had not slept on their rights. Cuaycong vs. CuaycongFacts:

Eduardo Cuaycong, married to Clotilde de Leon, died in 1936 without issue but with three brothers and a sister surviving him: Lino, Justo, Meliton and Basilisa. Upon his death, his properties were distributed to his heirs as he willed except two haciendas the Haciendas Sta. Cruz and Pusod both known as Hacienda Bacayan. Hacienda Bacayan is in the name of Luis D. Cuaycong, son of Justo Cuaycong.

The surviving children of Lino Cuaycong filed a suit against Justo and Luis Cuaycongfor conveyance of inheritance and accounting, before the CFI of Negros Occidental alleging that:

1. Eduardo Cuaycong, made known to his brothers and sisters that he and his wife Clotilde had an understanding and made arrangements with Luis and Justo, that it was their desire to divide Hacienda Bacayan among his brothers and sister and his wife Clotilde.

2. The brothers and sister failed to pay for the share in the hacienda thus it was later acquired by Luis Cuaycong thru clever strategy, fraud, misrepresentation and in disregard of Eduardo's wishes by causing the issuance in his name of certificates of title covering said properties.

3. Plaintiffs demands had been refused and in 1960 during the estate proceedings of Praxedes Escalon, deceased wife of Luis D. Cuaycong, the latter fraudulently made it appear that the plaintiffs had nothing to do with the land; that Luis Cuaycong had possessed the lands since 1936.

xxx

8. Said two haciendas were then the subject of certain transactions between the spouses Eduardo Cuaycong and Clotilde de Leon on one hand, and Justo and Luis D. Cuaycong on the other, Eduardo Cuaycong told his brother Justo and his nephew, defendant Luis D. Cuaycong, to hold in trust what might belong to his brothers and sister as a result of the arrangements and to deliver to them their shares when the proper time comes, to which Justo and Luis D. Cuaycong agreed.

CFI ruled that the trust alleged, particularly in paragraph 8 of the complaint, refers to an immovable which under Article 1443 of the Civil Code may not be proved by parole evidence. Plaintiffs were given 10 days to file an amended complaint mentioning or alleging therein the written evidence of the alleged trust, otherwise the case would be dismissed.

Plaintiff thereafter manifested that the claim is based on an implied trust as shown by paragraph 8 of the complaint. They added that there being no written instrument of trust, they could not amend the complaint to include such instrument.

Complaint was dismissed. Hence this petition.

Issue:

W/N the trust referred by the plaintiff is implied or expressed?

Held:

NO. It was an express trust. Express and Implied trust can be understood as:

ExpressImplied

created by the intention of the trustor or of the parties comes into being by operation of law

direct and positive acts of the parties, by some writing or deed or will or by words evidencing an intention to create a trustwithout being expressed, are deducible from the nature of the transaction by operation of law as matters of equity, in dependently of the particular intention of the parties

From these and from the provisions of paragraph 8 of the complaint itself, the court found that the plaintiffs alleged an express trust over an immovable, especially since it is alleged that thetrustor expresslytold the defendants of his intention to establish the trust. Thus, such a situation definitely falls under Article 1443 (Express) of the Civil Code.

Further, the intention of the trustor to establish the alleged trust may be seen in paragraphs 5 and 6.Article 1453 (Implied trust) would apply if the person conveying the property did not expressly state that he was establishing the trust, unlike the case at bar where he was alleged to have expressed such intent.

Even assuming the alleged trust to be an implied one, the right alleged by plaintiffs would have already prescribed since starting in 1936 when the trustor died, plaintiffs had already been allegedly refused by the aforesaid defendants in their demands over the land, and the complaint was filed only in 1961 more than the 10-year period of prescription for the enforcement of such rights under the trust.

It is settled that the right to enforce an implied trust in one's favor prescribes in ten (10) years. And even under the Code of Civil Procedure, action to recover real property such as lands prescribes in ten years.

LORENZO V.POSADASFacts:On 27 May 1922, Thomas Hanley died in Zamboanga, leaving a will and considerable amount of real and personal properties. Hanleys will provides the following: his money will be given to his nephew, Matthew Hanley, as well as the real estate owned by him. It further provided that the property will only be given ten years after Thomas Hanleys death. Thus, in the testamentary proceedings, the Court of First Instance of Zamboanga appointed P.J.M. Moore as trustee of the estate. Moore took oath of office on March 10, 1924, and resigned on Feb. 29, 1932. Pablo Lorenzo was appointed in his stead. Juan Posadas, Collector of Internal Revenue, assessed inheritance tax against the estate amounting to P2,057.74 which includes penalty and surcharge. He filed a motion in the testamentary proceedings so that Lorenzo will be ordered to pay the amount due. Lorenzo paid the amount in protest after CFI granted Posadas motion. He claimed that the inheritance tax should have been assessed after 10 years. He asked for a refund but Posadas declined to do so. The latter counterclaimed for the additional amount of P1,191.27 which represents interest due on the tax and which was not included in the original assessment. However, CFI dismissed this counterclaim. It also denied Lorenzos claim for refund against Posadas. Hence, both appealed.Issue: 1. Whether or not Hanley intended to create a trust in his will?Held:Yes. Ratio:The defendant maintains that it was the duty of the executor to pay the inheritance tax before the delivery of the decedent's property to the trustee. Stated otherwise, the defendant contends that delivery to the trustee was delivery to thecestui que trust, the beneficiery in this case, within the meaning of the first paragraph of subsection (b) of section 1544 of the Revised Administrative Code. This contention is well taken and is sustained. The appointment of P. J. M. Moore as trustee was made by the trial court in conformity with the wishes of the testator as expressed in his will. It is true that the word "trust" is not mentioned or used in the will but the intention to create one is clear. No particular or technical words are required to create a testamentary trust. The words "trust" and "trustee", though apt for the purpose, are not necessary. In fact, the use of these two words is not conclusive on the question that a trust is created. "To create a trust by will the testator must indicate in the will his intention so to do by using language sufficient to separate the legal from the equitable estate, and with sufficient certainty designate the beneficiaries, their interest in the ttrust, the purpose or object of the trust, and the property or subject matter thereof. Stated otherwise, to constitute a valid testamentary trust there must be a concurrence of three circumstances: (1) Sufficient words to raise a trust; (2) a definite subject; (3) a certain or ascertain object; statutes in some jurisdictions expressly or in effect so providing." There is no doubt that the testator intended to create a trust. He ordered in his will that certain of his properties be kept together undisposed during a fixed period, for a stated purpose. The probate court certainly exercised sound judgment in appointment a trustee to carry into effect the provisions of the will.

3. ImpliedJUAN VS. YAPFactsSpouses Maximo and Dulcisima Castaneda mortgaged to petitioner Richard Juan, employee and nephew of respondent Gabriel Yap, Sr. (respondent), two parcels of land in Talisay, Cebu to secure a loan of P1.68 million, payable within one year. The Contract was prepared and notarized by Atty. Antonio Solon.

Petitioner, represented by Solon, sought the extrajudicial foreclosure of the mortgage. Although petitioner and respondent participated in the auction sale, the properties were sold to petitioner for tendering the highest bid of P2.2 million. No certificate of sale was issued to petitioner, however, for his failure to pay the sale's commission.Respondent and the Castaneda spouses executed a memorandum of agreement (MOA) where (1) the Castaneda spouses acknowledged respondent as their "real mortgagee-creditor x xx while Richard Juan [petitioner] is merely a trustee" of respondent; (2) respondent agreed to allow the Castaneda spouses to redeem the foreclosed properties for P1.2 million; and (3) the Castaneda spouses and respondent agreed to initiate judicial action "either to annul or reform the [Contract] or to compel Richard Juan to reconvey the mortgagee's rights" to respondent as trustor. Three days later, the Castaneda spouses and respondent sued petitioner in the RTC of Cebu City to declare respondent as trustee of petitionervisa visthe Contract, annul petitioner's bid for the foreclosed properties, declare the Contract "superseded or novated" by the MOA, and require petitioner to pay damages, attorney's fees and the costs. The Castanedaspouses consigned with the trial court the amount of P1.68 million as redemption payment.

IssueWhether an implied trust arose between petitioner and respondent, binding petitioner to hold the beneficial title over the mortgaged properties in trust for respondent

RulingYes. The question of the existence of an implied trust is factual, hence, ordinarily outside the purview of a Rule 45 review of purely legal questions. Nevertheless, our review is justified by the need to make a definitive finding on this factual issue in light of the conflicting rulings rendered by the courts below.An implied trust arising from mortgage contracts is not among the trust relationships the Civil Code enumerates. The Code itself provides, however, that such listing "does not exclude others established by the general law on trust x x x." Under the general principles on trust, equity converts the holder of property right as trustee for the benefit of another if the circumstances of its acquisition makes the holder ineligible "in x xx good conscience [to] hold and enjoy [it]." As implied trusts are remedies against unjust enrichment, the "only problem of great importance in the field of constructive trusts is whether in the numerous and varying factual situations presented x xx there is a wrongful holding of property and hence, a threatened unjust enrichment of the defendant."Applying these principles, this Court recognized unconventional implied trusts in contracts involving the purchase of housing units by officers of tenants' associations in breach of their obligations, the partitioning of realty contrary to the terms of a compromise agreement, and the execution of a sales contract indicating a buyer distinct from the provider of the purchase money. In all these cases, the formal holders of title were deemed trustees obliged to transfer title to the beneficiaries in whose favor the trusts were deemed created. We see no reason to bar the recognition of the same obligation in a mortgage contract meeting the standards for the creation of an implied trust.Kiel vs. Estate of SabertFactsAlbert F. Kiel commenced to work on certain public lands situated in the municipality of Parang, Cotabato, known as Parang Plantation Company. In 1910, Kiel and P. S. Sabert entered into an agreement to develop the plantation. Sabert was to furnish the capital and Kiel was to manage it. It seems that this partnership was formed so that the land could be acquired in the name of Sabert, Kiel being a German citizen and not deemed eligible to acquire public lands in the Philippines. During the World War, Kiel was deported from the Philippines. Five persons, including P. S. Sabert, organized the Nituan Plantation Company, to which Sabert transferred all the rights and interests of the Parang Plantation Company. Kiel appears to have tried to secure a settlement from Sabert. But Sabert's death came before any amicable arrangement could be reached and before an action by Kiel against Sabert could be decided. So these proceedings against the estate of Sabert. IssueWhat is the nature of the proceeding? Is this an action to establish a resulting trust in the land of Sabert? NOHeldThe court held that a ruling on the issue of establishing trust is not needed. Note that the complaint as framed asks for a straight money judgment against an estate. In no part of the complaint did plaintiff allege any interest in land, claim any interest in land, or pretend to establish a resulting trust in land. This is not an action to establish trust in the land, because a trust will not be created when, for the purpose of evading the law prohibiting one from taking or holding real property, he takes a conveyance thereof in the name of a third person.Also, no partnership agreement in writing was entered into by Kiel and Sabert. Thus the real issue is whether or not the alleged verbal copartnership formed by Kiel and Sabert has been proved. The court held that declarations of one partner, not made in the presence of his copartner, are not competent to prove the existence of a partnership between them, and that the existence of a partnership cannot be established by general reputation, rumor, or hearsay.Although we feel that competent evidence exists establishing the partnership, Kiel under the facts had no standing in court to ask for any part of the land and in fact he does not do so. His only legal right is to ask for what is in effect an accounting with reference to its improvements and income when Sabert became the trustee of the estate on behalf of Kiel. Kiel is not entitled to any share in the land itself, but he has clearly shown his right to one-half of the value of the improvements and personal property on the land. The value of these improvements and of the personal property cannot be ascertained from the record and the case must therefore be remanded for further proceedings. Thomson vs. CAFACTSPetitioner Marsh Thomson (Thomson) was the EVP and, later on, the Management Consultant of private respondent, the American Chamber of Commerce of the Philippines, Inc. (AmCham) for over ten years, 1979-1989.While petitioner was still working with private respondent, his superior, A. Lewis Burridge, retired as AmChams President.Before Burridge decided to return to his home country, he wanted to transfer his proprietary share in the Manila Polo Club (MPC) to petitioner.However, private respondent insisted on paying for the share but had it listed in petitioners name, with the condition that Thomson should execute such necessary documents to acknowledge beneficial ownership thereof by the Chamber. Burridge then transferred said proprietary share to petitioner, as confirmed in a letter of notification to the MPC.Upon his admission as a new member of the MPC, petitioner paid the transfer fee ofP40,000.00 from his own funds; but private respondent subsequently reimbursed this amount.MPC issued Proprietary Membership Certificate in favor of petitioner.But petitioner, however, failed to execute a document recognizing private respondents beneficial ownership over said share.When petitioners contract of employment was up for renewal in 1989, he notified private respondent that he would no longer be available as EVP.Still, the private respondent asked the petitioner to stay on for another six (6) months.Petitioner indicated his acceptance of the consultancy arrangement with a counter-proposal in his letter stipulating his intention to retain the Polo Club share, subject to his reimbursing the purchase price to the Chamber, or P110,000.Private respondent rejected petitioners counter-proposal.Pending the negotiation for the consultancy arrangement, private respondent executed on a Release and Quitclaim, stating that the chamber intended to release Thomson from any and all existing claims that it (Amcham) may have against the latter (Thomson). The quitclaim however failed to mention the MPC share.In April 1990, private respondent, through counsel sent a letter to the petitioner demanding the return and delivery of the MPC share. Failing to get a favorable response, private respondent filed a complaint against petitioner.The trial court awarded the MPC share to Thomson on the ground that the Articles of Incorporation and By-laws of Manila Polo Club prohibit artificial persons, such as corporations, to be club members. The CA reversed the trial courts judgment and ordered herein petitioner to transfer the MPC share to the nominee of private respondent. Hence this petition for review.ISSUES(1) W/N AmCham was the beneficial owner of the disputed share(2) W/N it was right for Thomson to transfer said share to Amchams nominee

DECISION and RATIOYESPetitioner claims ownership of the MPC share, asserting that he merely incurred a debt to respondent when the latter advanced the funds for the purchase of the share. On the other hand, private respondent asserts beneficial ownership whereby petitioner only holds the share in his name, but the beneficial title belongs to private respondent.To resolve the first issue, we must clearly distinguish a debt from atrust.

TRUSTDEBT

Beneficiary of a trust has beneficial interest in the trust propertyCreditor has merely a personal claim against the debtor

There is a fiduciary relation b/w a trustee and a beneficiaryThere is no such relation b/w a debtor and creditor

Trust refers to a duty to deal w/ a specific property for the benefit of anotherDebt implies merely an obli to pay a certain sum of money

If a creditor-debtor relationship exists, but not a fiduciary relationship between the parties, there is no express trust. However, it is understood that when the purported trustee of funds is entitled to use them as his or her own (and commingle them with his or her own money), a debtor-creditor relationship exists, not a trust.

In the present case, as the EVP of AmCham, petitioner occupied a fiduciary position in the business of Amcham. AmCham released the funds to acquire a share in the Club for the use of petitioner but obliged him to execute such document as necessary to acknowledge beneficial ownership thereof by the Chamber. A trust relationship is, therefore, manifestly indicated.

Moreover, petitioner failed to present evidence to support his allegation of being merely a debtor when the private respondent paid the purchase price of the MPC share. Applicable here is the rule that a trust arises in favor of one who pays the purchase money of property in the name of another, because of the presumption that he who pays for a thing intends a beneficial interest therein for himself.

Although petitioner initiated the acquisition of the share, evidence on record shows that private respondent acquired said share with its funds.Petitioner did not pay for said share, although he later wanted to.

Private respondents evident purpose in acquiring the share was to provide additional incentive and perks to its chosen executive, the petitioner himself.

Although the share was placed in the name of petitioner, his title is limited to the usufruct, that is, to enjoy the facilities and privileges of such membership in the club appertaining to the share. Such arrangement reflects a trust relationship governed by law and equity.

While private respondent paid the purchase price for the share, petitioner was given legal title thereto.Thus, a resulting trust is presumed as a matter of law.Petitioner could have negated the trust agreement by contrary, consistent and convincing evidence on rebuttal.However, on the witness stand, petitioner failed to do so persuasively.We, therefore, find no reversible error in the respondent Courts holding that private respondent, AmCham, is the beneficial owner of the share in dispute.

(1) YES

Turning now to the second issue, the petitioner contends that the Articles of Incorporation and By-laws of Manila Polo Club prohibit corporate membership. However, private respondent does not insist nor intend to transfer the club membership in its name but rather to its designated nominee.

In this case, the petitioner was the nominee of the private respondent to hold the share and enjoy the privileges of the club.But upon the expiration of petitioners employment as officer and consultant of AmCham,the incentives that go with the position, including use of the MPC share, also ceased to exist.It now behooves petitioner to surrender said share to private respondents next nominee, another natural person.Obviously this arrangement of trust and confidence cannot be defeated by the petitioners citation of the MPC rules to shield his untenable position, without doing violence to basic tenets of justice and fair dealing.

However, we still have to ascertain whether the rights of herein parties to the trust still subsist.It has been held that so long as there has been no denial or repudiation of the trust, the possession of the trustee of an express and continuing trust is presumed to be that of the beneficiary, and the statute of limitations does not run between them. With regard to a constructive or a resulting trust, the statute of limitations does not begin to run until the trustee clearly repudiates or disavows the trust and such disavowal is brought home to the other party,cestui que trust. The statute of limitations runs generally from the time when the act was done by which the party became chargeable as a trustee by operation of law or when the beneficiary knew that he had a cause of action in the absence of fraud or concealment.

Noteworthy in the instant case, there was no declared or explicit repudiation of the trust existing between the parties. Such repudiation could only be inferred as evident when the petitioner showed his intent to appropriate the MPC share for himself. The statute of limitation could start to set in at this point in time.But private respondent took immediate positive action.Since the private respondent filed the necessary action on time and the defense of good faith is not available to the petitioner, there is no basis for any purported claim of prescription, after repudiation of the trust, which will entitle petitioner to ownership of the disputed share.As correctly held by the respondent court, petitioner has the obligation to transfer now said share to the nominee of private respondent.

Uy Aloc vs. Cho Jan LingFACTSA number of Chinese merchants raised a fund by voluntary subscription with which they purchased a valuable tract of land and erected a large building to be used as a sort of club house for the mutual benefit of the subscribers to the fund. The subscriber organized themselves into an irregular association, which had no regular articles in the commercial registry or elsewhere. The association did not have any existence as a legal entityIt was agreed to have the title to the property placed in the name of one of the members, the defendant, Cho Jan Ling, who on his part accepted the trust, and agreed to hold the property as the agent of the members of the association.After the club building was completed with the funds of the members of the association, Cho Jan Ling collected some P25,000 in rents for which he failed and refused to account, and upon proceedings being instituted to compel him to do so, he set up title in himself to the club property as well as to the rents accruing therefrom, falsely alleging that he had bought the real estate and constructed the building with his own funds, and denying the claims of the members of the association that it was their funds which had been used for that purpose.The plaintiffs, being prejudiced filed a case against the defendant and the lower court favored Uy Aloc and his companions and granted relief to the damages they suffered. Hence, this appeal.ISSUEWhether or not there was an implied trust in the agreement of the associationHELDYes. There was an implied trust. The decree entered by the court below should be affirmed with costs against the appellants.RATIOWe are nevertheless unable to see that any real or substantial right of the appellants Cho Jan Ling, et al. was prejudiced thereby. Due, doubtless, to the inherent difficulties which must be anticipated in the conduct of a case wherein a large number of the parties are Chinese persons, unable to speak any tongue but their own, some formal or technical irregularities seem to have crept into the proceedings in the court below but none of these irregularities or amendments in any wise prejudiced the defense set up by the appellants in the court below and assignments of error based thereon can not be sustained under section 503 of the Code of Civil Procedure, which provides that "No judgment shall be reversed on formal or technical grounds, or for such error as has not prejudiced the real rights of the excepting party."Accepting, as we do, the truth and accuracy of the facts found by the trial court there can be no shadow of doubt that the plaintiffs are entitled to the relief furnished them by the decree. In the case at bar we think that the evidence clearly discloses not only that the funds with which the property in question was purchased were furnished by the members of the association, but that Cho Jan Ling, in whose name it was registered, received and holds the property as the agent and trustee of the association; that on at least one occasion he admitted the beneficial ownership to be in the association; and that while the legal registered title is in his name the beneficial ownership is in the association. In this case, the legal title of the holder of the registered title is not questioned. It is admitted that the members of the association voluntarily obtained the inscription in the name of Cho Jan Ling and that they have no right to have that inscription cancelled. They do not seek such cancellation, and on the contrary they allege and prove that the duly registered legal title to the property is in Cho Jan Ling, but they maintain, and we think that they rightly maintain, that he holds it under an obligation, both express and implied, to deal with it exclusively for the benefit of the members of the association and subject to their will.Muller vs MullerFACTS:This petition for review on certiorari assails the February 26, 2001 Decision of the Court of Appeals affirming with modification the August 12, 1996 Decision 3 of the Regional Trial Court of Quezon City which terminated the regime of absolute community of property between petitioner and respondent, as well as the Resolution 4 dated August 13, 2001 denying the motion for reconsideration.Petitioner Elena Buenaventura Muller and respondent Helmut Muller were married in Hamburg, Germany on September 22, 1989 and resided in Germany at a house owned by respondent's parents but decided to move and reside permanently in the Philippines in 1992. By this time, respondent had inherited the house in Germany from his parents which he sold and used the proceeds for the purchase of a parcel of land in Antipolo, Rizal at the cost of P528,000.00 and the construction of a house amounting to P2,300,000.00. The Antipolo property was registered in the name of petitioner under Transfer Certificate of Title No. 219438 5 of the Register of Deeds of Marikina, Metro Manila.Due to incompatibilities and respondent's alleged womanizing, drinking, and maltreatment, the spouses eventually separated. Respondent filed a petition for separation of properties before the Regional Trial Court of Quezon City.On August 12, 1996, the trial court rendered a decision which terminated the regime of absolute community of property and decreed the separation of properties between them, ordering the equal partition of personal properties located within the country, excluding those acquired by gratuitous title during the marriage. With regard to the Antipolo property, the court held that it was acquired using paraphernal funds of the respondent.However, the part of that inheritance used by the petitioner for acquiring the house and lot in this country cannot be recovered by the petitioner, its acquisition being a violation of Section 7, Article XII of the Constitution which provides that "save in cases of hereditary succession, no private lands shall be transferred or conveyed except to individuals, corporations or associations qualified to acquire or hold lands of the public domain." The law will leave the parties in the situation where they are in without prejudice to a voluntary partition by the parties of the said real property.The CA held that respondent merely prayed for reimbursement for the purchase of the Antipolo property, and not acquisition or transfer of ownership to him. It also considered petitioner's ownership over the property in trust for the respondent. As regards the house, the Court of Appeals ruled that there is nothing in the Constitution which prohibits respondent from acquiring the same. Respondent Elena Buenaventura Muller is hereby ordered to REIMBURSE the petitioner the amount of P528,000.00 for the acquisition of the land and the amount of P2,300,000.00 for the construction of the house situated in Antipolo, Rizal, deducting therefrom the amount respondent spent for the preservation, maintenance and development of the aforesaid real property. ISSUES:W/N the Ca erred in granting reimbursement to the respondent (contested by the petitioner as a circumvention of the Constitutions prohibition on aliens acquiring real properties in the Philippines)RULING:The petition has merit.Section 7, Article XII of the 1987 Constitution states:Save in cases of hereditary succession, no private lands shall be transferred or conveyed except to individuals, corporations, or associations qualified to acquire or hold lands of the public domain. Aliens, whether individuals or corporations, are disqualified from acquiring lands of the public domain. Hence, they are also disqualified from acquiring private lands. "Sec. 5.Save in cases of hereditary succession, no private agricultural land will be transferred or assigned except to individuals, corporations, or associations qualified to acquire or hold lands of the public domain in the Philippines."This constitutional provision closes the only remaining avenue through which agricultural resources may leak into aliens' hands. It would certainly be futile to prohibit the alienation of public agricultural lands to aliens if, after all, they may be freely so alienated upon their becoming private agricultural lands in the hands of Filipino citizens. . . .If the term "private agricultural lands" is to be construed as not including residential lots or lands not strictly agricultural, the result would be that "aliens may freely acquire and possess not only residential lots and houses for themselves but entire subdivisions, and whole towns and cities," and that "they may validly buy and hold in their names lands of any area for building homes, factories, industrial plants, fisheries, hatcheries, schools, health and vacation resorts, markets, golf courses, playgrounds, airfields, and a host of other uses and purposes that are not, in appellant's words, strictly agricultural." (Solicitor General's Brief, p. 6.) That this is obnoxious to the conservative spirit of the Constitution is beyond question.Respondent was aware of the constitutional prohibition and expressly admitted his knowledge thereof to this Court. He declared that he had the Antipolo property titled in the name of petitioner because of the said prohibition. His attempt at subsequently asserting or claiming a right on the said property cannot be sustained.The Court of Appeals erred in holding that an implied trust was created and resulted by operation of law in view of petitioner's marriage to respondent. Save for the exception provided in cases of hereditary succession, respondent's disqualification from owning lands in the Philippines is absolute. Not even an ownership in trust is allowed. Besides, where the purchase is made in violation of an existing statute and in evasion of its express provision, no trust can result in favor of the party who is guilty of the fraud. To hold otherwise would allow circumvention of the constitutional prohibition.Respondent cannot seek reimbursement on the ground of equity where it is clear that he willingly and knowingly bought the property despite the constitutional prohibition. Further, the distinction made between transfer of ownership as opposed to recovery of funds is a futile exercise on respondent's part. To allow reimbursement would in effect permit respondent to enjoy the fruits of a property which he is not allowed to own. Petition is GRANTED. The Decision ordering petitioner Elena Buenaventura Muller to reimburse respondent Helmut Muller are REVERSED and SET ASIDE. Decision of the Regional Trial Court of Quezon City terminating the regime of absolute community between the petitioner and respondent, decreeing a separation of property between them and ordering the partition of the personal properties located in the Philippines equally, is REINSTATED.

4. Prescription

AMEROL vs. BAGUMBARAN

FACTS

This is a petition for review on certiorari of the decisionof the then Court of First Instance of Lanao del Sur, Branch III, Marawi City. Lot No. 524, Pls-126 is the tract of land alleged by the plaintiff to have been forcibly entered into by the defendants and which plaintiff now wishes to recover possession thereof. The same lot was covered by two free patent applications: (1) that of defendant Liwalug Datomanong (erroneously surnamed Amerol) which he filed on the 4th day of September, 1953, and (2) that of Molok Bagumbaran which was filed on December 27, 1954. As to these two free patent applications, that of plaintiff Molok Bagumbaran was given due course as a result of which Free Patent No. V-19050 was issued on August 16,1955 and duly registered with the office of the Register of Deeds of the Province of Lanao whereupon Original Certificate of Title No. P-466 was duly issued. Defendant Liwalug Datomanong had never known of plaintiff's free patent application on the land in question nor was he ever notified or participated in the administrative proceedings relative to plaintiff's free patent application. In the meantime, said defendant has been and up to the present in continuous occupation and cultivation of the same. Said defendant did not take appropriate action to annul the patent and title of the plaintiff within one year from issuance thereof and that the first step taken by him to contest said patent and title was a formal protest dated April 24, 1964, filed before the Bureau of Lands after the lapse of 9 years from the issuance of patent in favor of the plaintiff. The second step he took was his counterclaim filed with this court on December 4, 1964, wherein defendant reiterated his stand that plaintiff secured patent on the land by means of deceit and fraud. Proofs are sufficient to support defendant's contention that plaintiff is guilty of fraud and misrepresentation. On or before filing his free patent application, plaintiff knew that the land in question which was covered by his free patent application was then actually occupied and cultivated by defendant Liwalug Datomanong. Notwithstanding the aforequoted findings, the trial court denied the counterclaim of the defendants, now petitioners, for the affirmative relief of reconveyance on the ground of prescription. The trial court held that, since the answer and counter-claim was filed on December 4, 1964, 9 years from the date of registration of the patent, the defendants right to reconveyance within the period of 4 years from the date of registration of said patent had prescribed.

ISSUE: Whether or not the trial court erred in holding that the petitioners right of action for reconveyance for violation of an implied trust prescribed after 4 years from the registration of the patent of respondent

HELD: YES. An action for reconveyance for violation of an implied trust prescribes in 10 YEARS.

The act of respondent in misrepresenting that he was in actual possession and occupation of the property in question, obtaining a patent and Original Certificate of Title No. P- 466 in his name, created an implied trust in favor of the actual possessor of the said property. The land in question was patented and titled in respondent's name by and through his false pretenses. Molok Bagumbaran fraudulently misrepresented that he was the occupant and actual possessor of the land in question when he was not because it was Liwalug Datomanong. Bagumbaran falsely pretended that there was no prior applicant for a free patent over the land but there was Liwalug Datomanong. By such fraudulent acts, Molok Bagumbaran is deemed to hold the title of the property in trust and for the benefit of petitioner Liwalug Datomanong. Notwithstanding the irrevocability of the Torrens title already issued in the name of respondent, he, even being already the registered owner under the Torrens system, may still be compelled under the law to reconvey the subject property to Liwalug Datomanong. In an action for reconveyance, the decree of registration is respected as incontrovertible. What is sought instead is the transfer of the property, in this case the title thereof, which has been wrongfully or erroneously registered in another person's name, to its rightful and legal owner,or to one with a better right.

It is now well-settled that an action for reconveyance based on an implied or constructive trust prescribes in ten years from the issuance of the Torrens title over the property. The only discordant note, it seems, isBalbin vs. Medalla,which states that the prescriptive period for a reconveyance action is four years.

However, this variance can be explained by the erroneous reliance onGerona vs. de Guzman.But in Gerona, the fraud was discovered on June 25, 1948, hence Section 43(3) of Act No. 190, was applied, the new Civil Code not coming into effect until August 30, 1950 as mentioned earlier. It must be stressed, at this juncture, that Article 1144 and Article 1456, are new provisions. They have no counterparts in the old Civil Code or in the old Code of Civil Procedure, the latter being then resorted to as legal basis of the four-year prescriptive period for an action for reconveyance of title of real property acquired under false pretenses. The action of petitioner Datomanong for reconveyance, in the nature of a counterclaim filed on December 4, 1964, has not yet prescribed. Between August 16, 1955, the date of reference, being the date of the issuance of the Original Certificate of Title in the name of the respondent, and December 4, 1964, when the period of prescription was interrupted by the filing of the Answer cum Counterclaim, is less than ten years.

Marquez v. CAFacts:Spouses Rafael and Felicidad Marquez had 12 children. In 1945, the spouses acquired a parcel of land in Rizal where they constructed their conjugal home. When Felicidad died, Rafael Sr. executed an Affidavit of Adjudication vesting unto himself sole ownership to the property. In 1983, Rafael donated the property to 3 of his children --- petitioner Rafael JR, Alfredo (respondent) and Belen (respondent) to the exclusion of his other children.From 1983-1991, private repondentes (Alfredo and Belen) were in actual possession of the land. When petitioners learned about the title of the land, they demanded that since they are also children of Rafael SR, they are entitled to their respective shares. Respondents ignored petitioners demands.According to petitioners, the Deed of Donation executed by their father was fraudulent since the respondents took advantage of their fathers advanced age. Respondents contend that the petitioners action was already barred by the statute of limitations since the same should have been filed within 4 years from the date of discovery of the alleged fraud.Issue:Whether the action for reconveyance had prescribedHeld: NO

Ruling:Petitioners contention:By virtue of the fraudulent deed of donation, a constructive trust was created, and that an action for reconveyance based on implied or constructive trust prescribes in 10 years.Held:Indeed, when Rafael SR. obtained an affidavit stating that he was the only heir of his wife when in fact their children were still alive, and managed to secure a transfer of certificate of title under his name, a constructive trust was established.On whether the reconveyance had prescribed:An action for reconveyance based on an implied or constructive trust prescribes in 10 years from the issuance of the Torrens title over the property.The prescriptive period runs from the date when the transfer of certificate of title was issued in favor of Rafael SR which was on June 16, 1982. The action for reconveyance was filed on May 31, 1991 = 9 years later, which means that prescription had not yet barred the action.

Additional:Rafael SR, as trustee to his wifes share, cannot donate this portion to the private respondents.

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