Implied Trust Digests

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G.R. No. L-22571 May 25, 1973

JOSEFINA VALDEZ, et.al !. "EOFILAOLORGA et. Al

#a!e$This is an action for partition led by theliving children and grandchildren of the latespouses Federico Valdez, Sr. and Juanita Batul

against the heir and widow of Federico Valdez, Jr.The action concerns ot !o. "#, of $uerto$rincesa %adastre, covered by T.%.T. !o. T&'( inthe na)e of Federico Valdez, Jr.

FA#"S$

The land in *uestion ot !o. "# of the $uerto$rincesa %adastre, was originally purchased bythe spouses Federico Valdez, Sr. and Juanita Batulfro) +olores . de -utierrez for $//.//0however the sale not registered because theoriginal title was lost, but they had been in open,public, peaceful and uninterrupted occupationand possession of ot !o. "#, the property in*uestion, since the year "'1/ or "'110 Theparties herein, plainti2s and defendants ali3e, areall successors&in&interest of the spouses, either asforced or co)pulsory heirs or in representationthereof0

$ortion of the property was rented out to certainr. 4uicho who eventually purchased a portion ofsaid lot.

That in "'(5, upon discovering that the land in*uestion had not been transferred in the na)e of

their parents, Josena Valdez )ade e2orts tohave the said land transferred to the), andco))issioned cousin rs. %astro, together withFederico Valdez, Jr., to negotiate with the-utierrez fa)ily for the purpose, whichcul)inated in the e6ecution of the deed of sale.

The -utierrez fa)ily de)anded additionalpay)ent fro) vendees. r. 4uicho advanced thea)ount of $7,7//.// partly as purchase price ofthe portion purchased by hi), in the nale6ecution of the deed of sale, and

The +eed of Sale was nalized but was nallyplaced in the na)e of Valdez, Jr. alone as vendee,

instead of the 89eirs of Federico Valdez, Sr.8 or89eirs of Juanita Batul8 with the e6pressunderstanding that he will hold the sa)e in trustfor his other brother and sisters. :t was donethrough the suggestion of r. 4uicho who wantedto facilitate his own deed of sale over the portionthat he purchased0

Valdez, Jr. never asserted, nor atte)pted toassert, during his lifeti)e, sole and e6clusiveownership of the pre)ises in *uestion, againstthe herein plainti2s0 but after his death in "';/,his widow tried to e7? that when AFederico Valdez, Jr. was still living,8he never atte)pted to e6clude the hereinplainti2s fro) ownership of the land in *uestion,>and? said plainti2s have been in continuous anduninterrupted possession of the pre)ises theyare occupying inside the lot in *uestion longbefore the e6ecution of the deed of sale >and? itwas only after the death of Federico Valdez, Jr. >in"';/? that the widow, Teola lorga, tried toe


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prescription of ownership, this %ourt has held innu)erous decisions involving duciary relationssuch as those occupied by a trustee with respectto the cestui que trustthat as a general&rule thefor)erAs possession is not adverse and thereforecannot ripen into a title by prescription. Gdversepossession in such a case re*uires, theconcurrence of the following&circu)stances= >a?that the trustee has perfor)ed une*uivocal actsof repudiation a)ounting to an ouster of

the cestui que trust0 >b? that such, positive actsof repudiation have been )ade 3nown tothe cestui que trust and >c? that the evidencethereon should be clear and conclusive.(Thesecircu)stances are not present in this case.

:n view of the foregoing considerations theStar Mist?.

$art of their agree)ent=

ata )a3es advances for the crewAs

)edical e6penses, !ational Sea)anAs

Board fees, Sea)anAs @elfare fund K

standby fees K for the crewAs basic

personal needs. ata sends )onthly billings to Star Mist

>its foreign principal? which will rei)burse

ata by sending a telegraphic transfer

through ban3s for credit to the latterAs

account.

n February 7", "'5, Security $acic !ational

Ban3 >SD$G%? of os Gngeles which had an

agency arrange)ent with $!B, trans)itted a

cable )essage to the :nternational +epart)ent

of $!B to pay the a)ount of CSN"(,/// to

ata by crediting the latterAs account with the

:nsular Ban3 of Gsia K G)erica >:BGG?, per

order of Star Mist.

Cpon receipt of this cabled )essage on February

7(, "'5, $!BAs :nternational +epart)ent

noticed an error K sent a service )essage to

SD$G% Ban3.

The latter replied with instructions that the

a)ount of CSN"(,/// should only be for

CSN",(//.

n the basis of the cable )essage dated

February 7(, "'5 %ashierAs %hec3 !o. 7;'77in the a)ount of CSN",(// >$',557.'?

representing rei)burse)ent fro) Star Mist,

was issued by the Star Mist for the account of

ata on February 7, "'5 through the :nsular

Ban3 of Gsia and G)erica >:BGG?.

9owever, "( days afterLon arch "", "'5, $!B

e2ected another pay)ent through %ashierAs

%hec3 !o. 75/75" in the a)ount of CSN"(,///

>$'5,#5#.;/? purporting to be another

trans)ittal of rei)burse)ent fro) Star Mist.

; years laterLon ay "1, "'#", $!B re*uested

ata for refund of CSN"(,/// >$'5,#5#.;/?

after it discovered its error in e2ecting the 7nd

pay)ent.

n February (, "'#7, Nled a l a!e o&

olleto+ a+4 &e'+4 o 0S1),666 against

Mata arguing that based on a constructive

trust under Grticle "(; of the %ivil %ode, it has

a right to recover the said a)ount it

erroneously credited to ata.

R"# MANILA$

+is)issed the co)plaint &O the instant case fallss*uarely under Grticle 7"( &O solutio indebiti

K not under Grticle "(; &O constructive trust.

uled out constructive trust &O applying strictly

the technical denition of a t&'!t as a &8t

o :&o:e&ty, &eal o& :e&!o+al, el4 ;y o+e

:a&ty o& te ;e+e


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co))enced within ; yrs.

$!BAs co)plaint was led only on February (,

"'#7 &O al)ost 5 years after arch "", "'5 >it

)ista3enly )ade pay)ent to ata?.

e+e, te +!ta+t :etto+ o& certiorari

:&oee4+8 !ee>+8 to a++'l te 4e!o+ o

te a::ellate o'&t

Basis= ataAs obligation to return CSN"(,/// isgoverned by either Grticle "(; on constructive

trust Grticle 7"( of the %ivil %ode on *uasi&

contract.

Grticle "(; of the %ivil %ode provides= :f property

is ac*uired through )ista3e or fraud, the

person obtaining it is, by force of law,

considered a trustee of an i)plied trust for the

benet of the person fro) who) the property

co)es.

Grticle 7"( states= :f so)ething is received when

there is no right to de)and it, and it was

unduly delivered through )ista3e, the

obligation to return it arises.

$!B opted for an interpretation under

constructive trust as its action led on February

(, "'#7 can still prosper &O well within the

prescriptive period of "/ years as provided by

Grticle ""(( >7? of the %ivil %ode.

:f it is to be construed as a case of :ay?e+t ;y

?!ta>eLsolutio indebiti &O the prescriptive

period for *uasi&contracts of ; yrs applies >Grticle""(?.

Gs pointed out by the appellate court, $!BAs

cause of action thereunder shall have prescribed,

having been brought al)ost 5 years after the

cause of action accrued.

o%ee&, ee+ a!!'?+8 tat te +!ta+t

a!e o+!tt'te! a o+!t&'te t&'!t a+4

:&e!&:to+ a! +ot !et +, te :&e!e+t

ato+ a! al&ea4y ;ee+ ;a&&e4 ;y lae!.

---- 4!'!!o+! o+ "R0S"S ----

I+ te a!e at ;a&, Mata, + &ee+8 te

0S1),666 + t! ao'+t t&o'8 IAA, a4

+o +te+t o ol4+8 te !a?e o& a

!'::o!e4 ;e+e)oney? has

been received when there was no right to

de)and it and >7? the sa)e was unduly delivered

through )ista3e. There is a presu)ption that

there was a )ista3e in the pay)ent 8if so)ething

which had never been due or had already

been paidwas delivered0 but he fro) who) the

return is clai)ed )ay prove that the delivery was

)ade out of liberality or for any other No. 2*9522 a4 al&ea4y

;ee+ ?a4e ;y N o& te ao'+t o Mata

o+ Fe;&'a&y 25, 1975.

St&a+8ely, 1) 4ay! late&, N eete4

a+ote& :ay?e+t t&o'8 #a!e&! #e>

No. 276271 + te a?o'+t o 0S1),666,

t! t?e :'&:o&t+8 to ;e a+ote&

t&a+!?ttal o &e?;'&!e?e+t &o? Sta& /!t:&ate &e!:o+4e+t! o&e8+ :&+:alH.

---- 4!'!!o+! o+ te :&+:le o '+4'e

e+&?e+t@!ol'to+ +4e;t, B'a!-o+t&at

o+!t&'te t&'!t----

le :etto+e& ?ay +4ee4 o:t to aal o

a+ ato+ to e+o&e a o+!t&'te t&'!t OR

te B'a!-o+t&at o solutio indebiti, t a!

;ee+ 4e:&e4 o a oe, o& :&e!&:to+

a! eetely ;lo>e4 B'a!-o+t&at a! a+

alte&+ate, lea+8 o+ly o+!t&'te t&'!t

a! te ea!;le o:to+.

etto+e&$argues that the lower and appellate

courts cannot indulge in se)antics by holding

that in Grticle "(; the recipient co))its the

)ista3e while in Grticle 7"(, the recipient

co))its no )ista3e.

&ate &e!:o+4e+t$ invo3ing the appellate

courtAs reasoning, would i)press upon us that

under Grticle "(;, there can be no )utual

)ista3e &O contends that the case at bar is one of

solutio indebitiand not a constructive trust.

@e agree with $!BAs stand that under Grticle

"(;, the law does not )a3e any distinction since

)utual )ista3e is a possibility on either side Q

on the side of either the grantor or the grantee.

Thus, it was error to conclude that in a

constructive trust, only the person obtaining the

property co))its a )ista3e. This is because it is

also possible that a grantor, li3e $!B in the case

at hand, )ay co))it the )ista3e.

ISS0E$ @N :etto+e& ?ay !tll la? te

0S1),666 t e&&o+eo'!ly :a4 :&ate&e!:o+4e+t '+4e& a o+!t&'te t&'!t. NO.

Glthough we are aware that only seven >5? years

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lapsed after petitioner erroneously credited

private respondent with the said a)ount and that

under Grticle ""((, petitioner is well within the

prescriptive period for the enforce)ent of a

constructive or i)plied trust, %e &'le tat

:etto+e&! la? a++ot :&o!:e& !+e t !

al&ea4y ;a&&e4 ;y lae!. It ! a %ell-!ettle4

&'le +o% tat a+ ato+ to e+o&e a+

?:le4 t&'!t, %ete& &e!'lt+8 o&

o+!t&'te, ?ay ;e ;a&&e4 +ot o+ly ;y

:&e!&:to+ ;'t al!o ;y lae!.

@hile prescription is concerned with the fact of

delay, laches deals with the e2ect of

unreasonable delay. :t is a)azing that it too3

petitioner al)ost 5 years before it discovered

that it had erroneously paid private respondent.

$etitioner would attribute its )ista3e to the heavy

volu)e of international transactions handled by

the %able and e)ittance +ivision of the

:nternational +epart)ent of $!B. Such specious

reasoning is not persuasive. :t is unbelievable for

a ban3, and a govern)ent ban3 at that, which

regularly publishes its balanced nancial

state)ents annually or )ore fre*uently, by the

*uarter, to notice its error only 5 years later. Gs a

universal ban3 with worldwide operations, $!B

cannot a2ord to co))it such costly )ista3es.

oreover, as between parties where negligence

is i)putable to one and not to the other, the

for)er )ust perforce bear the conse*uences of

its neglect. 9ence, petitioner should bear the cost

of its own negligence.

AFFIRMED 4e!o+ o #A 4!?!!+8 N!

la? a8a+!t MA"A. #o!t! a8a+!t

:etto+e&.

DIS#0SSION ON "R0S"S$

"&'!t!&O either e6press or i)plied.

E:&e!! t&'!t! &O created by the intention of

the trustor or of the parties

I?:le4 t&'!t!&O by operation of law.

&O those which, without being

e6pressed, are deducible fro) the nature

of the transaction as )atters of

intentLwhich are superinduced on the

transaction by operation of law as

)atters of e*uity, independently of the

particular intention of the parties.

&O subdivided into resulting and

constructive trusts.

Re!'lt+8 t&'!t &O a trust raised by i)plication

of law K presu)ed always to have been

conte)plated by the parties &O intention of whichis found in the nature of the transaction, but not

e6pressed in the deedLinstru)ent of conveyance.

D6a)ples= found in Grticles "((# to "( of the

%ivil %ode.

#o+!t&'te t&'!t &O not created by words

either e6pressly or i)pliedly, but by construction

of e*uity in order to satisfy the de)ands of


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&+:le o '+4'e e+&?e+t@solutio

indebiti -K not new0 incorporated on *uasi&

contracts >Title RV: of Boo3 :V of the Spanish %ivil

%ode entitled 8bligations incurred without

contract?

%hapter on Trusts &O fairly recent, having been

introduced by the %ode %o))ission in "'('.

%oncept of trusts &O not found in Spanish %ivil

%ode &O fra)ers of our present %ivil %ode

incorporated ?:le4 t&'!t! includes

constructive trusts, on top of *uasi&contracts,

both of which e)body the principle of e*uity

above strict legalis).

A?e&a+ La%$

a court of e*uity does not consider a

constructive trustee for all purposes as

though he were in reality a trustee0

although it will force hi) to return the

property, it will not i)pose upon hi) the

nu)erous duciary obligations ordinarily

de)anded fro) a trustee of an e6press

trust. :t )ust be borne in )ind that in an

e6press trust, the trustee has active

duties of )anage)ent while in a

constructive trust, the duty is )erely to

surrender the property.

*uasi&contractual obligations give rise to

a personal liability ordinarily enforceable

by an action at law, while constructive

trusts are enforceable by a proceeding in

e*uity to co)pel the defendant to

surrender specic property.

The distinction &O )ore procedural than

substantive.

#o+!t&'te t&'!t -K ?!ta>e+ a! a

B'a!-o+t&at, !o a& &e?oe4 a&e tey&o? t&'!t! a+4 o+t&at! :&o:e&,

&e!:etely= a &elato+!: ! o&e4 ;y

o:e&ato+ o la% ':o+ te :a&te!, +ot

;ea'!e o a+y +te+to+ o+ te& :a&t ;'t +

o&4e& to :&ee+t '+'!t e+&?e+t, t'!

8+8 &!e to e&ta+ o;l8ato+! +ot %t+

te o+te?:lato+ o te :a&te!.

Glthough we are not *uite in accord with the

opinion that 8the t&'!t!3nown to G)erican and

Dnglish e*uity particularly o+e:t o

o+!t&'te t&'!tH.

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