CIVIL LAW

TITAN CONSTRUCTION CORPORATION v. SPS. MANUEL DAVID, SR. and

MARTHA DAVID
G.R. No. 169548, March 15, 2010

SUBJECT/ TOPIC: Conjugal Partnership Property

THESIS STATEMENT:
Titan Construction Corporation filed a Petition for Review on Certiorari assailing the Decision
of the Court of Appeals which affirmed with modification the Decision of the Regional Trial
Court which invalidate both the Deed of Sale and Transfer Certificate of Title, ordered to
reconvey the property, directed the Quezon City Register of Deeds to issue a new title, and
ordered to pay damages, all in favor of Sps. Manuel and Martha David and its Resolution
denying Motion for Reconsideration.
FACTS:
Manuel and Martha David were married on March 25, 1957 and sometime in 1970, the spouses
acquired a parcel of land (602 sq. m.) at White Plains, Quezon City and the same was registered
in the name of the wife, Martha David and covered by Transfer Certificate of Title (TCT) No.
156043 which was registered by the Register of Deeds of Quezon City. The spouses separated
de facto and no longer communicated with each other in 1976. Later in 1995, the husband,
Manuel David discovered that Martha had sold a property to Titan Construction Corp. through
a Deed of Sale for Php 1,500,000.00 which transferred the title in the name of Titan, cancelling
and replacing the TCT No. 156043 to TCT No. 130129.
Aggrieved, Manuel filed a Complaint for Annulment of Contract and Reconveyance against
Titan before the RTC of Quezon City alleging that said Deed of Sale was void for the contract
was executed without his knowledge and consent. Hence, he prayed that both the Deed of Sale
and TCT No. 130129 be invalidated, property be reconveyed to the spouses, and a new title be
issued in the spouses’ names. Through the Answer with Counterclaim, Titan prayed for the
dismissal of the complaint insisting that it bought the property in good faith and that the Special
Power of Attorney (SPA) which was allegedly signed by Manuel authorized Martha to dispose
the property on behalf of the spouses. However, in Manuel’s unverified Reply, he claimed that
the SPA was spurious and the signature purporting to be his was a forgery. Hence, Martha had
no authority to dispose the property on behalf of the spouses as claimed by Titan. The RTC
ruled in favor of Manuel stating that since the spouses purchased the property with conjugal
funds during their marriage, the property is conjugal by nature and even if the title was
registered in the name of Martha, it didn’t negate that the property is conjugal. Titan also failed
to rebut the expert’s testimony stating that the signature was not genuine and that even though
SPA was notarized it was doubtful for it didn’t contain Manuel’s residence certificate and not
presented for registration with the QC Register of Deeds in violation of Sec 64 of P.D. No.
1529. Lastly, the RTC noted that Titan should have put on notice the SPA’s doubtful veracity
with its transaction with Martha. With these in mind, the RTC granted the invalidation of both
the Deed of Sale and the TCT No. 130129, the reconveyance of the property to the spouses,
the issuance of a new title in the name of the spouses directing the QC Register of Deeds, and
compelling Titan to pay Php 200,000.00 plus Php 1,000.00 per appearance as attorney’s fees,
and Php 50,000.00 as cost of suit. The CA affirmed the decision of the RTC with modification
deleting the award of attorney’s fees and cost of suit. Hence, this Petition for Review on
Certiorari.
ISSUE/S:
1. WON the property was Martha’s exclusive property.
2. WON the Deed of Sale in valid even without Manuel’s consent.
3. WON the Special Power of Attorney (SPA) allegedly signed by Manuel is spurious and
void.
4. WON the failure of Manuel to specifically deny the genuineness and due execution of
the notarized SPA as his implied agreement to the veracity of the document.
5. WON Titan can claim belatedly that the RTC should have ordered Martha to reimburse.
HELD:
1. NO. The property is NOT the exclusive property of Martha alone but part of the
conjugal partnership property of the spouses.
Since the marriage of the spouses is in 1957, the marriage is governed by the Civil Code
of the Philippines which provides in Art. 160 that “All property of the marriage is
presumed to belong to the conjugal partnership, unless it be proved that it pertains
exclusively to the husband or to the wife” and in Art. 153 which defines a conjugal
property to be those that are “acquired by onerous title during the marriage at the
expense of the common fund, whether the acquisition be for the partnership, or for only
one of the spouses.” Hence, even if Manuel failed to present any proof of his income in
1970, assuming that Manuel could not have the financial capacity to contribute to the
purchase as claimed by Titan, the court ruled that Manuel was not required to prove
that the said property was acquired with conjugal funds (Sps. Castro v. Miat). Since the
spouses bought the property during their marriage, the presumption can be applied to
the case that if said property, when purchased during the marriage, was part of a
conjugal partnership as provided by Art. 160 and 153. Therefore, the property was
owned not only by Martha but the property was also owned by her husband, Manuel.

2. NO. The Deed of Sale is NOT valid without Manuel’s consent.

Since the property is part of the spouses’ conjugal property, the Deed of Sale required
both the consent of the spouses. The Civil Code provides in Art. 165, husband is the
administrator of the conjugal partnership and also in Art. 172 provides that the wife
cannot bind the conjugal partnership without the husband’s consent, except in cases
provided by law. Therefore, the Deed of Sale required also the consent of Manuel not
only Martha’s.

3. YES. The Special Power of Attorney allegedly signed by Manuel was spurious and
void.
Titan claimed that the RTC gave an undue weight to the testimony of Manuel’s witness,
Atty. Desiderio Paqui, which states that the signature found on the SPA was not
genuine. The Court, however, ruled that the ruling of the RTC was not only based on
 the testimony of the expert witness of Manuel but also Manuel’s categorical denial of
signing the SPA. The Court concur to the findings of the RTC that said SPA was
dubious for the SPA does not contain the Residence Certificate of Manuel and not
presented for registration with the QC Register of Deeds violating the Sec. 64 of P.D.
No. 1592. It is also noted by the Court that Titan withdraws its Motion for Re-
examination of Another Document/ Handwriting Expert because the PNP and NBI
might come out with two conflicting opinions and conclusions and may cause a waste
of time and resources. However, the Court ruled that factual findings of the trial court
when affirmed by CA are binding and conclusive and will not be reviewed on appeal
and that only errors of law are reviewable by the SC and not errors of fact. Hence, the
Court will not depart on the rulings of the RTC as affirmed by the CA.

4. NO. The failure of Manuel to specifically deny the genuineness and due execution of
the notarized SPA is NOT an implied agreement to the veracity of the document.
Although, Manuel failed to specifically deny the genuineness and due execution of the
notarized SPA in his Reply and not made under oath, his Complaint, under oath, that
a contract of a Deed of Sale between Martha and Titan executed without his consent,
and approval , express or implied, amounts great weight. The Court concurred with the
ruling of the CA that as Titan did not object to the presentation of Manuel’s witness,
Atty. Paqui, nor object to the introduction and admission of evidence questioning the
genuineness and due execution of the document, Titan had been deemed to waived its
protection provided by Rule 8, Sec. 7 and 8 of the Rules of Court. In addition, although,
a notarized document has a prima facie presumption of authenticity and due execution
unless with clear and convincing evidence that will proved otherwise, in this case,
where Manuel’s Community Tax Certificate was absent while Martha’s are complete,
supports Manuel’s claim that the signature purportedly his is a forgery, therefore, the
Court concludes that this notarization has defects.

5. NO. Titan CANNOT claim belatedly that the RTC should have ordered Martha to
reimburse.
The Court ruled that it cannot order the return of the amounts paid by Titan to Martha
for ordering such would deny due process to Martha. The party must be duly apprised
of a claim against her before judgment maybe rendered. If the Court ruled to hold
Martha liable to Titan for the reimbursement of money paid for the property, without
any claim being filed against her by Titan, would violate her right to due process.
However, The Court is not prohibiting Titan to file an appropriate case against Martha
before the proper court.

Petition DENIED. The Decision of the RTC as affirmed by the CA with modification
and its Resolution to deny Motion for Reconsideration are AFFIRMED.

Submitted by:
Jenova Jireh C. Arsua
JD1-M1