G.R. No. 168396 ; June 22, 2006
MARCELINA V. ESPINO, For Herself And In Representation of Her Deceased Mother, EMERENCIANA V. ESPINO, and Spouses FELIPE DE LOS SANTOS and MARISSA DE LOS SANTOS, Petitioners, vs. Spouses RICARDO VICENTE and EMMA M. VICENTE, Respondents.

FACTS

Emerenciana Espino and her daughter Marcelina, both illiterate, owned two untitled parcels of land. On March 31, 1995, Emerenciana sold a 20-square-meter portion of one lot to Marissa Delos Santos. Subsequently, in December 1996, respondent Emma Vicente, a niece, convinced the Espinos that she could facilitate the titling of their property. The Espinos, relying on this representation, signed a document they believed was for titling purposes. They later discovered the document was a “Pagkakaloob” or Deed of Donation, conveying the entire property, including the portion already sold, to Emma Vicente. Upon learning of the fraud, the Espinos executed a Deed of Revocation and filed a petition for annulment of the donation and any resulting patent/title.
The Regional Trial Court annulled the donation, finding it vitiated by fraud, and declared the subsequent free patent void. The Court of Appeals reversed this decision, upholding the donation’s validity based on the presumption of due execution. The petitioners sought review, arguing the appellate court disregarded factual findings of fraud.

ISSUE

Whether the Court of Appeals erred in reversing the trial court and upholding the validity of the Deed of Donation.

RULING

The Supreme Court granted the petition and reinstated the trial court’s decision, annulling the donation. The Court acknowledged that its review under Rule 45 is generally limited to questions of law. However, it recognized an exception due to the direct conflict between the factual findings of the trial court and the Court of Appeals, warranting a re-examination.
On the merits, the Court found the donation void due to vitiated consent. A donation requires donative intent. The evidence established that the illiterate Espinos signed the document under the false pretense that it was necessary to secure a title in their own names, not to donate the property. This constituted fraud or deceit under Article 1338 of the Civil Code, which exists when one party is induced to enter a contract through insidious words or machinations. Furthermore, the Court applied Article 1332, which states that when one of the parties is unable to read, fraud is presumed if the contract is grossly inequitable. The donation, which divested the owners of their property for no consideration, was grossly inequitable. The subsequent act of revocation and the testimony of a disinterested public land inspector confirming the Espinos’ occupancy bolstered the finding of fraud. Therefore, the consent was vitiated, rendering the donation voidable and rightly annulled by the trial court.