G.R. No. 110115 October 8, 1997
RODOLFO TIGNO AND SPOUSES EDUALINO and EVELYN CASIPIT, petitioners, vs. COURT OF APPEALS AND EDUARDO TIGNO, respondents.

FACTS

In January 1980, Bienvenido Sison, Remedios Sison, and the heirs of Isaac Sison appointed Dominador Cruz as agent to sell three adjoining parcels of land in Lingayen, Pangasinan. In April 1980, Rodolfo Tigno learned the properties were for sale and, with Cruz, approached his brother Eduardo Tigno (private respondent) to convince him to buy them. Eduardo agreed to buy each parcel for P10,000.00. On May 2, 1980, at Eduardo’s house, the sellers requested a 50% downpayment. Eduardo gave P5,000.00 each to three of the sellers, totaling P15,000.00. He instructed Cruz and the notary, Atty. Modesto Manuel, to place Rodolfo’s name as the “vendee” in the deeds of sale to enable Rodolfo to mortgage the properties at the Philippine National Bank (PNB) for funds to develop them as fishponds. The deeds of sale (Exhs. A, B, C) were subsequently prepared and signed on May 6, May 12, and June 12, 1980, naming Rodolfo as vendee. In July 1980, Eduardo gave Cruz a check for P26,000.00 covering the balance of P15,000.00 for the lands, Cruz’s commission, and taxes/expenses. Cruz paid the sellers the balance. On April 29, 1989, Rodolfo sold a 508.56-square-meter portion of one lot to spouses Edualino and Avelina Casipit (petitioners) without Eduardo’s knowledge. The Casipits were aware the land was owned by Eduardo, not Rodolfo. Eduardo filed a complaint for reconveyance, annulment of document, recovery of possession, and damages. The trial court dismissed the complaint, but the Court of Appeals reversed it, declaring Eduardo the true owner, annulling the deed of sale to the Casipits, and ordering Rodolfo to vacate and surrender possession to Eduardo.

ISSUE

Whether Eduardo Tigno is the true and lawful owner of the subject parcels of land, and whether an implied trust was created in his favor when the deeds of sale named his brother Rodolfo as the vendee.

RULING

Yes. The Supreme Court denied the petition and affirmed the Court of Appeals’ decision. The Court applied the principles of implied trust. An implied trust arose under Article 1448 of the Civil Code because Eduardo paid the purchase price for the properties, but the titles were placed in Rodolfo’s name. The evidence, including testimonies and the fact Eduardo provided all funds, established that Rodolfo was merely a trustee, and Eduardo was the true beneficial owner. The instruction to use Rodolfo’s name was solely to facilitate a bank loan for development. The subsequent sale by Rodolfo to the Casipits, who had prior knowledge of Eduardo’s ownership, was void. The Court, as an exception, reviewed the factual findings due to the trial court’s misappreciation of evidence, concluding the Court of Appeals correctly reversed the trial court.