GR 46955; (February, 1989) (Digest)
G.R. No. L-46955 February 27, 1989
Consorcia, Teodoro and Ernesto, all surnamed Agustino, and Spouses Benito Villavicencio & Corazon Sotto, petitioners, vs. The Honorable Court of Appeals (Third Division) and Severino Moldogo and Catalina Mercene, respondents.
FACTS
The case involves a three-hectare parcel of land, originally part of a homestead granted to Ambrocio Loren in 1925 under OCT No. 597. In 1926, within the five-year prohibitory period under the Homestead Law ( Commonwealth Act No. 141 ), Loren sold the land to Gavino Luarca. Luarca sold it to private respondents Severino Moldogo and Catalina Mercene in 1937. Both deeds were unregistered, but the respondents took and maintained possession. Loren’s heirs (petitioners Agustino) only executed an affidavit of adjudication and obtained TCT No. 7894 in 1958. In 1967, the Agustinos sold a portion, including the disputed land, to petitioner-spouses Villavicencio and Sotto, who then ousted the respondents. The respondents filed an action for recovery of possession.
The trial court awarded the land to the petitioners, declaring the 1926 sale from Loren to Luarca void for violating the five-year alienation ban. The Court of Appeals reversed, applying the equitable principle of laches against the petitioners due to their inaction from 1926 to 1958, and awarded the land to the respondents.
ISSUE
Whether the Court of Appeals erred in applying the doctrine of laches to award the land to the respondents, despite the original sale being void ab initio for contravening the mandatory prohibition under the Homestead Law.
RULING
The Supreme Court granted the petition, annulling the Court of Appeals decision and reinstating the trial court’s judgment with modification. The legal logic is clear: a sale of a homestead within the five-year prohibitory period is void ab initio as a matter of mandatory public policy under Commonwealth Act No. 141 . Such a void contract cannot be ratified or validated by the passage of time. Equity, including the principle of laches, cannot be invoked to give effect to a contract that is void from the beginning for being contrary to law and public policy. The Court has consistently held that the homestead law is designed to preserve land for the homesteader’s family, and this right cannot be waived.
Furthermore, the doctrine of pari delicto does not bar the heirs from recovering the property, as public policy exempts them to allow reacquisition of land intended for the family’s home and cultivation. The petitioner-vendees (Villavicencio and Sotto) were not innocent purchasers for value, as the respondents’ adverse claim was annotated on the title before their purchase. However, this does not alter the fundamental voidness of the original transfer. The heirs were ordered to reimburse the respondents the P150.00 purchase price paid to Loren. The decision is without prejudice to any reversion proceedings the government may institute.