G.R. No. 146853 ; February 13, 2006
SALVADOR COMILANG, Petitioner, vs. FRANCISCO BURCENA and MARIANO BURCENA, Respondents.

FACTS

Respondents Francisco and Mariano Burcena, together with their mother Dominga, filed a complaint for annulment of a Deed of Donation executed by Dominga in favor of petitioner Salvador Comilang. They alleged that they were the true owners of a parcel of land and a house in Ilocos Sur, having acquired the property through their earnings from working abroad. The property was merely declared in Dominga’s name for taxation purposes as their administrator. They contended the donation was void because Dominga, being blind, old, and infirm, was taken advantage of, had no ownership rights to donate, and even if she did, the donation left her without sufficient property for her support.
Petitioner defended the donation as a voluntary act by Dominga out of love and affection. He claimed the property was actually acquired by Dominga and her sisters long before the respondents worked abroad, and that Dominga financed the house construction. He argued that any money sent by respondents belonged to Dominga upon receipt, giving them no right over the property. Dominga died during the pendency of the case.

ISSUE

Whether the Court of Appeals erred in affirming the nullity of the Deed of Donation based on the application of the principle of implied trust.

RULING

The Supreme Court denied the petition and affirmed the lower courts’ decisions. The legal logic is clear: an implied trust existed under Article 1448 of the Civil Code, which establishes a purchase money resulting trust. This trust arises when property is conveyed to one person but the purchase price is paid by another for his own benefit. The evidence, including the credible testimony of the respondents’ aunt, Margarita Burcena, established that the respondents’ funds were used to purchase the property, even though title was placed in Dominga’s name. Consequently, Dominga held the property in trust for the respondents as the beneficial owners.
As a mere trustee, Dominga had no authority to donate the trust property to petitioner without the consent of the true owners. The donation was therefore void. The Court upheld the appellate court’s authority to apply the principle of implied trust, as it was indispensable to the just resolution of the case, even if not explicitly raised as an issue below. Furthermore, the Court deferred to the trial court’s factual findings and credibility assessments, which are generally binding. Margarita’s testimony regarding Dominga’s statements was properly admitted not as hearsay to prove the truth of ownership, but as a verbal act demonstrating Dominga’s recognition of her role as administrator, which was relevant to the trust relationship.