G.R. No. 59550 & 60636, January 11, 1995
EDILBERTO NOEL (PINITO W. MERCADO) as ADMINISTRATOR OF THE INTESTATE ESTATE OF GREGORIO NANAMAN and HILARIA TABUCLIN, petitioner, vs. COURT OF APPEALS and JOSE C. DELESTE, respondents.

FACTS

Gregorio Nanaman and Hilaria Tabuclin, a childless married couple, acquired a 34.7-hectare conjugal property. Gregorio died in 1945. In 1954, Hilaria, together with Virgilio Nanaman (Gregorio’s illegitimate son whom they reared), executed a deed of absolute sale over the entire land in favor of Jose C. Deleste for P16,000. The sale was registered on March 2, 1954. Hilaria died in May 1954. Intestate proceedings for both spouses were subsequently initiated.
The estate’s administrator, Edilberto Noel (later Pinito Mercado), filed an action in 1963 to recover the land from Deleste, arguing the sale was void as to Gregorio’s one-half share, which Hilaria had no authority to alienate. The trial court dismissed the complaint, ruling the action had prescribed and the heirs slept on their rights. The Court of Appeals initially reversed, holding Hilaria could only sell her half, but in an amended decision, applied the doctrine of laches against the estate.

ISSUE

Whether the action for reconveyance of Gregorio’s one-half share in the conjugal property is barred by prescription or laches.

RULING

The Supreme Court reversed the amended decision of the Court of Appeals and reinstated its original decision. The action was not barred. The legal logic is twofold. First, on prescription: The sale of Gregorio’s half to Deleste, a stranger, created an implied trust under Article 1456 of the Civil Code in favor of Gregorio’s rightful heirs. An action for reconveyance based on an implied trust prescribes in ten years from the registration of the deed. The sale was registered on March 2, 1954, and the complaint was filed on April 30, 1963—within the ten-year period.
Second, on laches: The doctrine does not apply. The administrator filed the recovery action promptly after being ordered by the probate court. There was no unreasonable delay or neglect by the estate in asserting its rights. Furthermore, Virgilio’s prior acts of possession and tax declaration were correctly viewed as acts assisting Hilaria in management, not as assertions of adverse ownership that could prejudice the heirs’ claims. The Court emphasized it will not readily apply laches to defeat an owner’s right. Thus, Deleste held Gregorio’s half as trustee, and reconveyance was ordered.