GR 143297; (February, 2003) (Digest)
G.R. No. 143297 ; February 11, 2003
Spouses Virgilio and Michelle Castro, Moises B. Miat and Alexander V. Miat, petitioners, vs. Romeo V. Miat, respondent.
FACTS
The Paco property was acquired during the marriage of spouses Moises and Concordia Miat. Upon Concordia’s death, Moises and their sons, Romeo and Alexander, orally agreed that the property would belong to the two sons. Romeo and Alexander possessed the property, paid taxes and insurance, and Romeo held the owner’s duplicate certificate of title. Alexander later agreed to sell his share to Romeo, receiving a partial payment. Despite this, Moises, experiencing financial difficulty, mortgaged and subsequently sold the entire Paco property to spouses Virgilio and Michelle Castro through a deed of absolute sale. Virgilio Castro was aware of Romeo’s claim and possession of the title prior to the sale.
ISSUE
The core issue is whether the oral agreement among Moises, Romeo, and Alexander constituted a valid partition of the conjugal property, thereby vesting ownership in the sons and rendering Moises’s subsequent sale to the Castros void.
RULING
The Supreme Court affirmed the Court of Appeals’ decision declaring the sale void. The legal logic rests on the nature of the property and the validity of the oral partition. The Paco property was conjugal. Upon Concordia’s death, her one-half share passed to her heirs—Moises, Romeo, and Alexander—creating a co-ownership. The subsequent oral agreement among them to divide the property constituted a partition, which is not subject to the Statute of Frauds as it is not a contract for the sale of real property but a distribution of ownership. This oral partition was ratified by the parties’ conduct: Romeo and Alexander took possession, paid expenses, and Moises initially recognized the arrangement.
Consequently, Moises only retained ownership over his designated share from the partition. His sale of the entire property, including the portions already belonging to his sons, was an act of disposition over property not his own. The Castros, as buyers, were in bad faith because they were informed of Romeo’s claim and his possession of the title prior to the sale. Therefore, the sale was void with respect to the shares of Romeo and Alexander. The Court ordered Alexander to execute a deed of sale for his share to Romeo upon payment of the balance, and recognized the validity of the sale only with respect to Moises’s own share in the property.