G.R. No. L-10915; March 30, 1960
SOLEDAD BACALZO, ET AL., petitioners, vs. MARTINA PACADA, respondent.

FACTS

On March 9, 1917, Carmiano Bacalzo, then married to Carmelina Padillo, entered into a contract (Sale Certificate No. 7009) with the Government to purchase Lot No. 1790 of the Talisay-Minglanilla Estate (Friar Lands) for P200.00, payable in installments. Carmelina Padillo died in 1922, survived by Carmiano and their children, the petitioners. In 1924, Carmiano married the respondent, Martina Pacada. Carmiano died on November 5, 1948. Payments for the lot were made during both marriages, with the bulk made during his union with Martina. The original purchase price was fully paid on June 17, 1947, with a shortage of interest paid on August 12, 1948. After a resurvey, the Bureau of Lands found the lot’s area was 2,275 sq.m., not 2,270 sq.m. as stated in the sale certificate. On February 16, 1953, the Friar Lands Agent required Martina Pacada to pay P0.45 for the additional 5 square meters, which she paid on March 4, 1953. On October 29, 1953, the Director of Lands forwarded the final deed of sale to the Register of Deeds for issuance of a transfer certificate of title to “the legal heirs of Carmiano Bacalzo, represented by Martina Pacada.” Transfer Certificate of Title No. 2898 was issued on November 11, 1953, in that name, subject to the rights of any other legal heirs. The petitioners, children of the first marriage, filed a special action for declaratory relief in the Court of First Instance of Cebu, seeking a determination of their rights to the lot against Martina Pacada. The trial court declared Martina the absolute owner, a decision affirmed by the Court of Appeals, prompting this petition for review.

ISSUE

Who has the right to succeed as owner of Lot No. 1790—the petitioners (children from the first marriage) or the respondent (surviving second spouse)—considering that the purchase price was fully paid during the lifetime of the deceased purchaser, Carmiano Bacalzo?

RULING

The Supreme Court reversed the decision of the Court of Appeals. It ruled that Carmiano Bacalzo became the actual owner of the lot upon full payment of the purchase price during his lifetime (completed by August 12, 1948), as the Government was legally bound to issue the conveyance under Section 12 of the Friar Lands Act (Act No. 1120). Ownership vested in the purchaser upon full payment, not upon issuance of the deed. The payment of P0.45 for the additional area after resurvey did not alter this, as friar lands are sold for a lump sum with definite boundaries, and the price does not change with minor area discrepancies. Since Carmiano died as the legal owner, succession is governed by Section 16 of the Friar Lands Act, which provides that the interest descends to those who would have taken it under the laws of the Philippines had title been perfected before death. Applying Article 834 of the old Civil Code (the law in force at Carmiano’s death in 1948), the surviving spouse (Martina Pacada) is entitled to a share in usufruct equal to the share of a legitimate child. Therefore, the deed and title must be issued in the name of the petitioners (the children), without prejudice to Martina Pacada’s right to a portion in usufruct equal to the legitime of each of the three petitioners. The Register of Deeds for Cebu was ordered to cancel TCT No. 2898 and issue a new one in the petitioners’ names, subject to Martina’s usufructuary right.