Eduarte v. Court of Appeals

G.R. No. 105944 (February 9, 1996)

Facts:

Pedro Calapine was the registered owner of a parcel of land in San Cristobal, San Pablo City, with an area of 12,199 square meters, evidenced by Original Certificate of Title No. P-2129. On April 26, 1984, he executed a deed of donation (Exhibit B) granting one-half of the property to his niece, Helen S. Doria. Subsequently, on July 26, 1984, another deed was executed, purportedly transferring the entire property to Doria, which led to the cancellation of the original title and the issuance of Transfer Certificate of Title No. T-23205 in her name.

On February 26, 1986, Doria donated a portion of the land (157 square meters) to the Calauan Christian Reformed Church, Inc., which resulted in the issuance of TCT No. T-24444 for the church and TCT No. T-24445 for the remaining land. On March 25, 1988, Doria sold the remaining land to spouses Romulo and Sally Eduarte, who received TCT No. T-27434.

Calapine later claimed that his signature on the second deed of donation was forged and that Doria was unworthy of his generosity. He filed a suit against Doria, the church, and the Eduarte spouses to revoke the donation and annul the subsequent deeds of donation and sale, as well as to cancel the titles issued in favor of Doria and the Eduartes.

The Eduartes denied knowledge of the first deed of donation and claimed that they were unaware of any issues regarding the title. They argued that Calapine's signature on the second deed was genuine and sought damages against him.

After Calapine's death, his nephews substituted him in the case. The Regional Trial Court ruled in favor of Calapine, revoking the donation and annulling the subsequent deeds, declaring the Eduartes as purchasers in bad faith. The Eduartes appealed the decision.

Legal Issues:

1. Whether the revocation of the donation made by Pedro Calapine to Helen Doria was valid based on allegations of ingratitude.
2. Whether the Eduartes were buyers in good faith or bad faith regarding the property they purchased from Doria.
3. The validity of the findings regarding the forgery of Calapine's signature on the second deed of donation.

Arguments:

• Petitioners (Eduartes):

  • They argued that the trial court erred in annulling the second deed of donation and the sale to them, claiming they were buyers in good faith. They contended that the alleged forgery of Calapine's signature did not constitute an act of ingratitude under Article 765 of the Civil Code, as it was a crime against public interest, not against Calapine personally.
  • They also claimed that the trial court gave undue weight to the testimony of the handwriting expert from the NBI, arguing that their own expert's testimony was equally valid.

• Respondents (Calapine's heirs):

  • They maintained that Doria's act of falsifying Calapine's signature constituted ingratitude, justifying the revocation of the donation. They argued that the Eduartes failed to exercise due diligence in verifying the ownership of the property, which should have raised suspicions about the legitimacy of the title.

Court's Decision and Legal Reasoning:

The Court of Appeals affirmed the trial court's decision, agreeing that Doria's act of forgery was an act of ingratitude that warranted the revocation of the donation. The court emphasized that all crimes that offend the donor can be grounds for revocation, including forgery.

Regarding the Eduartes' claim of being buyers in good faith, the court found that they failed to exercise due diligence. The presence of other occupants and structures on the property should have prompted them to investigate further. The court ruled that mere possession does not defeat the title of a registered owner, but the Eduartes were still deemed to have acted in bad faith due to the circumstances surrounding the sale.

The court also upheld the trial court's preference for the NBI handwriting expert's testimony over that of the Eduartes' expert, citing the thoroughness and scientific basis of the NBI's examination.

Significant Legal Principles Established:

1. Ingratitude as a Ground for Revocation: The court reaffirmed that acts of ingratitude, including crimes against the donor, can justify the revocation of a donation under Article 765 of the Civil Code.
2. Good Faith Purchasers: The ruling clarified that purchasers must exercise due diligence in verifying ownership, especially when circumstances suggest potential issues with the title.
3. Weight of Expert Testimony: The decision highlighted the importance of the thoroughness and credibility of expert testimony in determining the authenticity of signatures in forgery cases.