G.R. No. 171321 , December 18, 2008
MARY ANN DEHEZA-INAMARGA, petitioner, vs. CELENIA C. ALANO, BERNALDA A. PAROHINOG, GODOFREDO ALANO, AVELINO ALANO, ESTRELLA ALANO, FORTUNATA ALANO, NANY ALANO, SALLY ALANO, ADIONITO ALANO, and SUFRONIA ALANO, respondents.

FACTS

Tomas Alano, husband of respondent Celenia Alano, owned two parcels of land covered by OCT Nos. P-761 and P-762, which he mortgaged to Renato Gepty in 1972. In 1976, unable to redeem the properties, Tomas sought help from his niece, petitioner Mary Ann Deheza-Inamarga. Petitioner agreed to pay the loan, and in turn, the spouses mortgaged the properties to her. Petitioner kept the OCTs and asked the spouses to sign blank pieces of paper, which she claimed would be converted into receipts for their indebtedness. After Tomas died in 1990, respondents went to redeem the property but were told by petitioner she had mortgaged it to the Rural Bank of Libacao. Respondents discovered that the OCTs had been cancelled and TCTs were issued in petitioner’s name based on a Deed of Sale purportedly executed by the Spouses Alano in her favor. Respondents filed a complaint for nullity of document, reconveyance, and damages, contending the signatures were forged or were affixed on blank sheets not intended as a deed of sale. Petitioner claimed the deed was valid, that the spouses sold her the property for P7,000 to redeem it from Gepty, and that the action was barred by prescription, laches, and estoppel. The RTC declared the transaction an equitable mortgage, nullified the deed and TCTs, ordered reconveyance, and awarded exemplary damages and attorney’s fees. The Court of Appeals affirmed.

ISSUE

1. Whether the Deed of Sale is a forgery.
2. Whether the transaction between petitioner and the Spouses Alano is one of sale or equitable mortgage.
3. Whether respondents’ action is barred by prescription, laches, or estoppel.
4. Whether the award of exemplary damages and attorney’s fees is legal and justifiable.

RULING

1. On Forgery: The Supreme Court affirmed the findings of the lower courts that the signatures on the Deed of Sale were forged. The Court held that the question of forgery is one of fact, and the findings of the trial court, affirmed by the Court of Appeals, are conclusive and binding. The Court noted apparent differences in the signatures compared to genuine ones in other documents. It also ruled that the presentation of a handwriting expert is not mandatory, as judges can exercise independent judgment on the authenticity of signatures.
2. On Nature of Transaction: The Court upheld the ruling that the transaction was an equitable mortgage, not a sale. Applying Articles 1602 and 1604 of the Civil Code, the Court found multiple circumstances present: the selling price of P7,000 was grossly inadequate compared to the property’s value; the vendors (Spouses Alano) remained in possession; respondents paid real property taxes; and the real intention was to secure payment of a debt. Thus, the presumption of equitable mortgage applied.
3. On Prescription, Laches, and Estoppel: The Court ruled that the action was not barred. An action for the declaration of the inexistence of a contract, such as a forged deed, does not prescribe under Article 1410 of the Civil Code. Laches and estoppel were not applicable because respondents promptly filed the complaint in 1991 upon discovering the fraud in 1990, and petitioner’s fraudulent act prevented the running of laches.
4. On Damages and Attorney’s Fees: The Court affirmed the award of exemplary damages and attorney’s fees. Petitioner’s act of inducing her elderly relatives to sign blank papers to transfer titles was fraudulent, justifying exemplary damages to deter similar acts. Attorney’s fees were properly awarded under Article 2208 of the Civil Code as exemplary damages were granted.
The Supreme Court affirmed the Decision and Resolution of the Court of Appeals.