THIRD DIVISION

[G.R. No. 78178. April 15, 1988.]

DELIA BAILON-CASILAO, LUZ PAULINO-ANG, EMMA PAULINO-YBANEZ,

NILDA PAULINO-TOLENTINO, and SABINA BAILON , petitioners, vs. THE
HONORABLE COURT OF APPEALS and CELESTINO AFABLE , respondents.

Veronico E. Rubio for petitioners.

Mario G. Fortes for private-respondent.

SYLLABUS

1. CIVIL LAW; CO-OWNERSHIP; SALE OR DISPOSITION OF ENTIRE PROPERTY

AFFECTS ONLY HIS UNDIVIDED SHARE. — If a co-owner sells the whole property as his,
the sale will affect only his own share but not those of the other co-owners who did not
consent to the sale [Punsalan v. Boon Liat, 44 Phil. 320 (1923)]. The sale or other
disposition affects only his undivided share and the transferee gets only what would
correspond to his grantor in the partition of the thing owned in common. [Ramirez v.
Bautista, 14 Phil. 528 (1909)], thereby making him a co-owner of the property.
2. ID.; ID.; RECOURSE OF A CO-OWNER WHERE THE ENTIRE PROPERTY WAS
SOLD WITHOUT HIS CONSENT. — The appropriate recourse of co-owners in cases
where their consent were not secured in a sale of the entire property as well as in a sale
merely of undivided shares of some of the co-owners is an action for PARTITION under
Rule 69 of the Revised Rules of Court. Neither recovery of possession nor restitution
can be granted since the defendant buyers are legitimate proprietors and possessors
in joint ownership of the common property claimed [ Ramirez v. Bautista, supra].
3. REMEDIAL LAW; ACTION FOR PARTITION, IMPRESCRIPTIBLE. — An action for
petition is imprescriptible or cannot be barred by prescription [Article 494 of the Civil
Code; See also Budlong v. Bontoc (G.R. No. L-27702, September 9, 1977, 79 SCRA 24)].
4. ID.; PRESCRIPTION; WILL NOT LIE AGAINST REGISTERED LAND. —
Prescription will not lie in favor of respondent as against the petitioners who remain the
registered owners of the disputed parcel of land pursuant to Act No. 496 which
expressly provides that "(n)o title to registered land in derogation to that of the
registered owner shall be acquired by prescription or adverse possession."
5. ID.; ID.; ID.; MAY BE INVOKED BY ITS REGISTERED OWNER AND HIS HEIRS. —
If prescription is unavailing against the registered owner, it must be equally unavailing
against the latter's hereditary successors, because they merely step into the shoes of
the decedent by operation of law (New Civil Code, Article 777; Old Civil Code, Article
657), the title or right undergoing no change by its transmission mortis causa. [ Atus, et
al., v. Nunez, et al. , 97 Phil. 762, 764; Umbay v. Alecha , G.R. No. 67284, March 18, 1985,
135 SCRA 427, 429).
6. CIVIL LAW; LACHES; ELEMENTS. — The four basic elements of laches, namely:
(1) conduct on the part of the defendant or of one under whom he claims, giving rise to
the situation of which complaint is made and for which the complainant seeks a
remedy; (2) delay in asserting the complainant's rights, the complainant having had
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 knowledge or notice of the defendant's conduct and having been afforded an
opportunity to institute suit; (3) lack of knowledge or notice on the part of the
defendant that the complainant would assert the right on which he bases his suit; and,
(4) injury or prejudice to the defendant in the event relief is accorded to the
complainant, or the suit is not held to be barred [ Go Chi Gun, et al. v. Co Cho, et al. , 96
Phil. 622 (1955)].
7. ID.; ID.; MUST BE INVOKED BY PARTY IN GOOD FAITH. — Laches being an
equitable defense, he who invokes it must come to the court with clean hands.
8. ID.; ID.; MERE FACT OF DELAY, NOT SUFFICIENT. — Mere fact of delay is
insu cient to constitute, laches. It is required that (1) complainant must have had
knowledge of the conduct of defendant or of one under whom he claims and (2) he
must have been afforded an opportunity to institute suit.
9. ID.; LAND TITLES AND DEEDS; LAND REGISTRATION; ALL PERSONS DEALING
WITH REGISTERED LAND HAS ONLY TO RELY ON THE FACE OF TITLE; ACTUAL
KNOWLEDGE OF FLAW NECESSITATES FURTHER INQUIRY; EFFECT OF ABSENCE OF
INQUIRY. — A person dealing with a registered land has a right to rely upon the face of
the Torrens certi cate of title and to dispense with the need of inquiring further, except
when the party concerned has actual knowledge of facts and circumstances that would
impel a reasonably cautious man to make such inquiry. [ Gonzales v. IAC and Rural Bank
of Pavia, Inc., G.R. No. 69622, January 29, 1988]. The buyer's failure to exercise even a
minimum degree of ordinary prudence required by the situation, operates against him
and any prejudice or injury that may be occasioned to him by such sale must be borne
by him.

DECISION

CORTES , J : p

The fate of petitioners' claim over a parcel of land rests ultimately on a

determination of whether or not said petitioners are chargeable with such laches as
may effectively bar their present action.
The petitioners herein led a case for recovery of property and damages with
notice of lis pendens on March 13, 1981 against the defendant and herein private
respondent, Celestino Afable. The parcel of land involved in this case, with an area of
48,849 square meters, is covered by Original Certi cate of Title No. 1771 issued on
June 12, 1931, in the names of Rosalia, Gaudencio, Sabina, Bernabe, Nenita and Delia, all
surnamed Bailon, as co-owners, each with a 1/6 share. Gaudencio and Nenita are now
dead, the latter being represented in this case by her children, Luz, Emma and Nilda.
Bernabe went to China in 1931 and had not been heard from since then [Decision of the
Court of Appeals, Rollo, p. 39].
It appears that on August 23, 1948, Rosalia Bailon and Gaudencio Bailon sold a
portion of the said land consisting of 16,283 square meters to Donato Delgado. On May
13, 1949, Rosalia Bailon alone sold the remainder of the land consisting of 32,566
square meters to Ponciana V. Aresgado de Lanuza. On the same date, Lanuza acquired
from Delgado the 16,283 square meters of land which the latter had earlier acquired
from Rosalia and Gaudencio. On December 3, 1975, John Lanuza, acting under a special
power of attorney given by his wife, Ponciana V. Aresgado de Lanuza, sold the two
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 parcels of land to Celestino Afable, Sr.
In all these transfers, it was stated in the deeds of sale that the land was not
registered under the provisions of Act No. 496 when the fact is that it is. It appears that
said land had been successively declared for taxation rst, in the name of Ciriaca
Dellamas, mother of the registered co-owners, then in the name of Rosalia Bailon in
1924, then in that of Donato Delgado in 1936, then in Ponciana de Lanuza's name in
1962 and finally in the name of Celestino Afable, Sr. in 1983.
In his answer to the complaint led by the herein petitioners, Afable claimed that
he had acquired the land in question through prescription and contended that the
petitioners were guilty of laches. He later led a third-party complaint against Rosalia
Bailon for damages allegedly suffered as a result of the sale to him of the land.
After trial, the lower court rendered a decision:
1. Finding and declaring Celestino Afable, a co-owner of the land described
in paragraph III of the complaint having validly bought the two-sixth (2/6)
respective undivided shares of Rosalia Bailon and Gaudencio Bailon;
2. Finding and declaring the following as pro-indiviso co-owners, having
1/6 share each, of the property described in paragraph III of the complaint, to wit:

a. Sabina Bailon

b. Bernabe Bailon

c. Heirs of Nenita Bailon-Paulino

d. Delia Bailon-Casilao;

3. Ordering the segregation of the undivided interests in the property in

order to terminate co-ownership to be conducted by any Geodetic Engineer
selected by the parties to delineate the specific part of each of the co-owners.

4. Ordering the defendant to restore the possession of the plaintiffs'

respective shares as well as all attributes of absolute dominion;
5. Ordering the defendant to pay the following:

a. P5,000.00 as damages;
b. P2,000.00 as attorney's fees and;

c. to pay the costs.

[Decision of the Trial Court, Rollo, p. 37-38].

On appeal, the respondent Court of Appeals a rmed the decision of the lower
court insofar as it held that prescription does not lie against plaintiffs-appellees
because they are co-owners of the original vendors. However, the appellate court
declared that, although registered property cannot be lost by prescription, nevertheless,
an action to recover it may be barred by laches, citing the ruling in Mejia de Lucaz v.
Gamponia [100 Phil. 277 (1956)]. Accordingly, it held the petitioners guilty of laches
and dismissed their complaint. Hence, this petition for review on certiorari of the
decision of the Court of Appeals. cdrep

The principal issue to be resolved in this case concerns the applicability of the
equitable doctrine of laches. Initially though, a determination of the effect of a sale by
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 one or more co-owners of the entire property held in common without the consent of all
the co-owners and of the appropriate remedy of the aggrieved co-owners is required.
The rights of a co-owner of a certain property are clearly speci ed in Article 493
of the Civil Code. Thus:
Art. 493. Each co-owner shall have the full ownership of his part and of the
fruits and bene ts pertaining thereto, and he may therefore alienate, assign or
mortgage it and even substitute another person in its enjoyment, except when
personal rights are involved. But the effect of the alienation or mortgage, with
respect to the co-owners, shall be limited to the portion which may be allotted to
him in the division upon the termination of the co-ownership. [Emphasis
supplied.]

As early as 1923, this Court has ruled that even if a co-owner sells the whole
property as his, the sale will affect only his own share but not those of the other co-
owners who did not consent to the sale [ Punsalan v. Boon Liat , 44 Phil. 320 (1923)].
This is because under the aforementioned codal provision, the sale or other disposition
affects only his undivided share and the transferee gets only what would correspond to
his grantor in the partition of the thing owned in common. [ Ramirez v. Bautista , 14 Phil.
528 (1909)]. Consequently, by virtue of the sales made by Rosalia and Gaudencio
Bailon which are valid with respect to their proportionate shares, and the subsequent
transfers which culminated in the sale to private respondent Celestino Afable, the said
Afable thereby became a co-owner of the disputed parcel of land as correctly held by
the lower court since the sales produced the effect of substituting the buyers in the
enjoyment thereof [ Mainit v. Bandoy, 14 Phil. 730 (1910)].
From the foregoing, it may be deduced that since a co-owner is entitled to sell his
undivided share, a sale of the entire property by one co-owner without the consent of
the other co-owners is not null and void. However, only the rights of the co-owner-seller
are transferred, thereby making the buyer a co-owner of the property.
The proper action in cases like this is not for the nulli cation of the sale or for the
recovery of the thing owned in common from the third person who substituted the co-
owner or co-owners who alienated their shares, but the DIVISION of the common
property as of it continued to remain in the possession of the co-owners who
possessed and administered it [Mainit v. Bandoy, supra.]
Thus, it is now settled that the appropriate recourse of co-owners in cases where
their consent were not secured in a sale of the entire property as well as in a sale
merely of undivided shares of some of the co-owners is an action for PARTITION under
Rule 69 of the Revised Rules of Court. Neither recovery of possession nor restitution
can be granted since the defendant buyers are legitimate proprietors and possessors
in joint ownership of the common property claimed [ Ramirez v. Bautista, supra].
As to the action for petition, neither prescription nor laches can be invoked.
In the light of the attendant circumstances, defendant-appellee's defense of
prescription is a vain proposition. Pursuant to Article 494 of the Civil Code, "(n)o co-
owner shall be obliged to remain in the co-ownership. Such co-owner may demand at
anytime the partition of the thing owned in common, insofar as his share is concerned."
[Emphasis supplied.] In Budlong v. Bondoc [G.R. No. L-27702, September 9, 1977, 79
SCRA 241, this Court has interpreted said provision of law to mean that the action for
partition is imprescriptible or cannot be barred by prescription. For Article 494 of the
Civil Code explicitly declares: "No prescription shall lie in favor of a co-owner or co-heir
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 so long as he expressly or impliedly recognizes the co-ownership."
Furthermore, the disputed parcel of land being registered under the Torrens
System, the express provision of Act No. 496 that "(n)o title to registered land in
derogation to that of the registered owner shall be acquired by prescription or adverse
possession" is squarely applicable. Consequently, prescription will not lie in favor of
Afable as against the petitioners who remain the registered owners of the disputed
parcel of land. LibLex

It is argued however, that as to the petitioners Emma, Luz and Nelda who are not
the registered co-owners but merely represented their deceased mother, the late
Nenita Bailon, prescription lies. Respondents bolster their argument by citing a decision
of this Court in Pasion v. Pasion [G.R. No. L-15757, May 31, 1961, 2 SCRA 486, 489]
holding that "the imprescriptibility of a Torrens title can only be invoked by the person in
whose name the title is registered" and that "one who is not the registered owner of a
parcel of land cannot invoke imprescriptibility of action to claim the same."
Reliance on the aforesaid Pasion case is futile. The ruling therein applies only
against transferees other than direct issues or heirs or to complete strangers. The
rationale is clear:
If prescription is unavailing against the registered owner, it must be equally
unavailing against the latter's hereditary successors, because they merely step
into the shoes of the decedent by operation of law (New Civil Code, Article 777;
Old Civil Code, Article 657), the title or right undergoing no change by its
transmission mortis causa. [Atus, et al., v. Nunez, et al., 97 Phil. 762, 764].

The latest pronouncement of this Court in Umbay v. Alecha [G.R. No. 67284,
March 18, 1985, 135 SCRA 427, 429], which was promulgated subsequent to the
Pasion case reiterated the Atus doctrine. Thus:
Prescription is unavailing not only against the registered owner but also
against his hereditary successors, because they merely step into the shoes of the
decedent by operation of law and are merely the continuation of the personality
of their predecessor-in-interest. [Barcelona v. Barcelona, 100 Phil. 251, 257].

Laches is likewise unavailing as a shield against the action of herein petitioners.

Well-stated in this jurisdiction are the four basic elements of laches, namely: (1)
conduct on the part of the defendant or of one under whom he claims, giving rise to the
situation of which complaint is made and for which the complainant seeks a remedy;
(2) delay in asserting the complainant's rights, the complainant having had knowledge
or notice of the defendant's conduct and having been afforded an opportunity to
institute suit; (3) lack of knowledge or notice on the part of the defendant that the
complainant would assert the right on which he bases his suit; and, (4) injury or
prejudice to the defendant in the event relief is accorded to the complainant, or the suit
is not held to be barred [ Go Chi Gun, et al. v. Co Cho, et al., 96 Phil. 622 (1955)].
While the rst and last elements are present in this case, the second and third
elements are missing.
The second element speaks of delay in asserting the complainant's rights.
However, the mere fact of delay is insu cient to constitute, laches. It is required that
(1) complainant must have had knowledge of the conduct of defendant or of one under
whom he claims and (2) he must have been afforded an opportunity to institute suit.
This court has pointed out that laches is not concerned with the mere lapse of time.
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 Thus:
Laches has been de ned as the failure or neglect, for an unreasonable
length of time to do that which by exercising due diligence could or should have
been done earlier; it is negligence or omission to assert a right within a reasonable
time warranting a presumption that the party entitled to assert it either has
abandoned it or declined to assert it. [Tijam, et al., v. Sibonghanoy, G.R. No. L-
21450, April 25, 1968, 23 SCRA 29, 35; Tejido v. Zamacoma, G.R. No. L-63048,
August 7, 1985, 138 SCRA 73, 90]. cdphil

The doctrine of 'laches' or of 'stale demands' is based upon grounds of

public policy which requires for the peace of society, the discouragement of stale
claims and unlike the statute of limitations, is not a mere question of time but is
principally a question of inequity or unfairness of permitting a right or claim to be
enforced or asserted," [Tijam v. Sibonghanoy, supra, p. 351. [Emphasis supplied.]
It must be noted that while there was delay in asserting petitioners' rights, such
delay was not attended with any knowledge of the sale nor with any opportunity to
bring suit. In the rst place, petitioners had no notice of the sale made by their eldest
sister. It is undisputed that the petitioner co-owners had entrusted the care and
management of the parcel of land to Rosalia Bailon who was the oldest among them
[TSN, July 27, 1983, p. 14]. In fact, Nicanor Lee, a son of Rosalia, who was presented as
a witness by the plaintiffs-petitioners, testi ed on cross-examination that his mother
was only the administrator of the land as she is the eldest and her brothers and sisters
were away [TSN, October 5, 1983, p. 15]. Indeed, when Delia Bailon-Casilao left
Sorsogon in 1942 after she got married, it was only in 1983 that she returned. Sabina,
on the other hand, is said to be living in Zamboanga while Bernabe who left for China in
1931 has not been heard from since then. Consequently, when Rosalia, from whom the
private respondent derived his title, made the disputed sales covering the entire
property, the herein petitioners were unaware thereof.
In the second place, they were not afforded an opportunity to bring suit inasmuch
as until 1981, they were kept in the dark about the transactions entered into by their
sister. It was only when Delia Bailon-Casilao returned to Sorsogon in 1981 that she
found out about the sales and immediately, she and her co-petitioners led the present
action for recovery of property. The appellate court thus erred in holding that "the
petitioners did nothing to show interest in the land." For the administration of the parcel
of land was entrusted to the oldest co-owner who was then in possession thereof
precisely because the other co-owners cannot attend to such a task as they reside
outside of Sorsogon where the land is situated. Her co-owners also allowed her to
appropriate the entire produce for herself because it was not even enough for her daily
consumption [TSN, October 5, 1983, pp. 17-18]. And since petitioner was the one
receiving the produce, it is but natural that she was the one to take charge of paying the
real estate taxes. Now, if knowledge of the sale by Rosalia was conveyed to the
petitioners only later, they cannot be faulted for the acts of their co-owner who failed to
live up to the trust and con dence expected of her. In view of the lack of knowledge by
the petitioners of the conduct of Rosalia in selling the land without their consent in
1975 and the absence of any opportunity to institute the proper action until 1981,
laches may not be asserted against the petitioners. prLL

The third element of laches is likewise absent. There was no lack of knowledge
or notice on the part of the defendant that the complainants would assert the right on
which they base the suit. On the contrary, private respondent is guilty of bad faith in
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 purchasing the property as he knew that the property was co-owned by six persons and
yet, there were only two signatories to the deeds of sale and no special authorization to
sell was granted to the two sellers by the other co-owners.
Even as the land here was misrepresented in the deeds of sale as "unregistered,"
the truth was that Afable already had notice that the land was titled in the name of six
persons by virtue of the Certi cate of Title which was already in his possession even
before the sale. Such fact is apparent from his testimony before the court a quo:
COURT:

Q From whom did you get the certificate of Title?

A When it was mortgaged by Ponciana Aresgado.
Q It was mortgaged to you before you bought it?
A Yes, Your Honor. (TSN, March 5, 1984, p. 12) When cross-examined, he stated:

Q Mr. Witness, the original Certi cate of Title was given to you in the year 1974,
was it not?
A 1975.

Q In 1975, you already discovered that the title was in the name of several
persons, is it not?

A Yes, sir.
Q When you discovered that it is in the name of several persons, you led a case
in court for authority to cancel the title to be transferred in your name, is it
not?

A Yes, sir. LLjur

Q And that was denied by the Court of First Instance of Sorsogon because there
was only one signatory to the deed of sale instead of six, was it not?

A Not one but two signatories.

[Decision of the Regional Trial Court of Sorsogon, Rollo, p. 35]

Such actual knowledge of the existence of other co-owners in whose names the
lot subject of the sale was registered should have prompted a searching inquiry by
Afable considering the well-known rule in this jurisdiction that:
. . . a person dealing with a registered land has a right to rely upon the face
of the Torrens certi cate of title and to dispense with the need of inquiring further,
except when the party concerned has actual knowledge of facts and
circumstances that would impel a reasonably cautious man to make such inquiry.
[Gonzales v. IAC and Rural Bank of Pavia, Inc., G.R. No. 69622, January 29, 1988].

Moreover, the undisputed fact is that petitioners are relatives of his wife. As a
genuine gesture of good faith, he should have contacted the petitioners who were still
listed as co-owners in the certi cate of title which was already in his possession even
before the sale. In failing to exercise even a minimum degree of ordinary prudence
required by the situation, he is deemed to have bought the lot at his own risk. Hence any
prejudice or injury that may be occasioned to him by such sale must be borne by him.
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 Indeed, aware of the aws impairing his title, Afable went to the herein petitioner
Delia Bailon-Casilao, asking the latter to sign a document obviously to cure the aw
[TSN, July 27, 1983, p. 6]. Later, he even led a petition in the Court of First Instance to
register the title in his name which was denied as aforesaid.
It may be gleaned from the foregoing examination of the facts that Celestino
Afable is not a buyer in good faith. Laches being an equitable defense, he who invokes it
must come to the court with clean hands. Cdpr

WHEREFORE, the petition for certiorari is hereby GRANTED, the challenged

decision of the Court of Appeals is SET ASIDE, and the decision of the trial court is
REINSTATED.
SO ORDERED.
Fernan, Gutierrez, Jr., Feliciano and Bidin, JJ., concur.

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