GR 133895; (October, 2001) (Digest)
G.R. No. 133895; October 2, 2001
ZENAIDA M. SANTOS, petitioner, vs. CALIXTO SANTOS, ALBERTO SANTOS, ROSA SANTOS-CARREON and ANTONIO SANTOS, respondents.
FACTS
The case involves a parcel of land and an apartment in Manila originally owned by spouses Jesus and Rosalia Santos. They executed a deed of sale in 1959 in favor of their children, Salvador and Rosa. Rosa later sold her share to Salvador in 1973, making him the sole registered owner. Despite these transfers, Rosalia continued to possess the property, collect rentals, pay realty taxes, and retain the owner’s duplicate certificate of title. After the deaths of Jesus, Salvador, and Rosalia, petitioner Zenaida, Salvador’s widow, claimed ownership and demanded rents from a tenant. Private respondents, Salvador’s siblings, filed an action for reconveyance, alleging the deeds of sale were simulated—executed without consideration merely to accommodate Salvador’s business needs—and that ownership never truly passed to him.
ISSUE
The primary issues were: (1) whether the deeds of sale were simulated and void for lack of consideration and delivery; (2) whether the action for reconveyance had prescribed or was barred by laches; and (3) whether respondent Rosa Santos-Carreon was disqualified from testifying under the “Dead Man’s Statute.”
RULING
The Supreme Court denied the petition, affirming the lower courts’ decisions. On the first issue, the Court ruled the sales were indeed simulated and void. Under Article 1498 of the Civil Code, execution of a public instrument is equivalent to delivery only if the contrary does not appear. Here, the vendors’ continued acts of ownership—possession, collection of rents, and tax payments—clearly showed no delivery was intended or made. Salvador never exercised dominion. A simulated contract produces no legal effect, and an action to declare its nullity does not prescribe. On prescription and laches, the Court held that since the contracts were void ab initio, the right to seek nullity is imprescriptible. Laches did not apply as respondents’ delay in filing the suit did not prejudice petitioner. Finally, petitioner waived her right to invoke the “Dead Man’s Statute” against Rosa’s testimony by failing to appeal the trial court’s order allowing it and by cross-examining Rosa on matters occurring during Salvador’s lifetime.