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August 13, 2014

Mapalo vs. Mapalo

Facts:
  • The spouses Miguel Mapalo and Candida Quiba were the registered owners of a residential land located in Pangasinan. (1,635 sq. m.)
  • The spouses donated the eastern half of the land to Miguel’s brother – Maximo Mapalo who was about to get married.
  • However, they were deceived into signing, on October 15, 1936, a deed of absolute sale over the entire land in Maximo’s favor. Their signatures were procured by fraud because they were made to believe by Maximo and the lawyer who acted as notary public who "translated" the document, that the same was a deed of donation in Maximo's favor covering one-half of their land. (It must be noted that the spouses are illiterate farmers).
  • Although the document of sale stated a consideration of Five Hundred (P500.00) Pesos, the aforesaid spouses did not receive anything of value for the land. 
  • In 1938, Maximo Mapalo, without the consent of the spouse, registered the sale in his favor.
  • After thirteen years (1951), he sold the land to the Narcisos.  (Evaristo, Petronila Pacifico and Miguel) who thereafter registered the sale and obtained a title in their favor. 
  • In 1952, the Narcisos filed a complaint with the CFI to be declared owners of the entire land, for possession of its western portion; for damages; and for rentals. 
  • The Mapalo spouses filed a counterclaim seeking cancellation of the the Narcisos’ titles as to the western half of the land. They said that their  signatures to the deed of sale of 1936 was procured by fraud and that the Narcisos were buyers in bad faith.
  • They also filed another complaint wherein they asked the court to declare deeds of sale of 1936 and of 1951 over the land in question be declared null and void as to the western half of said land.
  • CFI ruled in favor of the Mapalo spouses. Upon appeal filed by Narcisos, CA reversed the lower court’s ruling solely on the ground that the consent of the Mapalo spouses to the deed of sale of 1936 having been obtained by fraud, the same was voidable, not void ab initio, and, therefore, the action to annul the same, within four years from notice of the fraud, had long prescribed. (From March 15, 1938).  Hence, this appeal.



Issues: 
1. WON the deed of sale executed in 1936 was null and void. YES
2. WON the Narcisos were purchasers in good faith. NO

Held: 

1st issue: YES, the sale was void.

The Civil Code governs the transaction because it was executed in 1936 
Accordingly, since the deed of sale of 1936 is governed by the Old Civil Code, it should be asked whether its case is one wherein there is no consideration, or one with a statement of a false consideration. If the former, it is void and inexistent; if the latter, only voidable, under the Old Civil Code. 

There is lack of consideration
As observed earlier, the deed of sale of 1936 stated that it had for its consideration Five Hundred (P500.00) Pesos. In fact, however, said consideration was totally absent. The problem, therefore, is whether a deed which states a consideration that in fact did not exist, is a contract without consideration, and therefore void ab initio, or a contract with a false consideration, and therefore, at least under the Old Civil Code, voidable.

When there is no consideration, the contract is null and void
According to Manresa, what is meant by a contract that states a false consideration is one that has in fact a real consideration but the same is not the one stated in the document.

In our view, therefore, the ruling of this Court in Ocejo, Perez & Co. vs. Flores, 40 Phil. 921, is squarely applicable herein. In that case we ruled that a contract of purchase and sale is null and void and produces no effect whatsoever where the same is without cause or consideration in that the purchase price which appears thereon as paid has in fact never been paid by the purchaser to the vendor.

2nd issue: No, they were no purchasers in good faith.

Narcisos were not buyers in good faith
Aside from the fact that all the parties in these cases are neighbors, except Maximo Mapalo the foregoing facts are explicit enough and sufficiently reveal that the Narcisos were aware of the nature and extent of the interest of Maximo Mapalo their vendor, over the above-described land before and at the time the deed of sale in their favor was executed.

The Narcisos were purchaser-in-value but not purchasers in good faith
What was the necessity, purpose and reason of Pacifico Narciso in still going to the spouses Mapalo and asked them to permit their brother Maximo to dispose of the above-described land? To this question it is safe to state that this act of Pacifico Narciso is a conclusive manifestation that they (the Narcisos) did not only have prior knowledge of the ownership of said spouses over the western half portion in question but that they also have recognized said ownership. It also conclusively shows their prior knowledge of the want of dominion on the part of their vendor Maximo Mapalo over the whole land and also of the flaw of his title thereto. Under this situation, the Narcisos may be considered purchasers in value but certainly not as purchasers in good faith.

REFERENCE:
G.R. No. L-21489 and L-21628             May 19, 1966
MIGUEL MAPALO, ET AL., petitioners, vs. MAXIMO MAPALO, ET AL., respondents.

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