GR L 11024; (January, 1958) (Digest)
G.R. No. L-11024; January 31, 1958
ALFONSO ANGELES, ET AL., petitioners, vs. THE COURT OF APPEALS, GREGORIO STA. INES and ANASTACIA DIVINO, respondents.
FACTS
On March 28, 1935, Original Certificate of Title No. 4906 was issued to Juan Angeles pursuant to Homestead Patent No. 31613. On May 28, 1937, within five years from the issuance of the title, Juan Angeles sold the homestead land to respondents Gregorio Sta. Ines and Anastacia Divino, who took possession. Juan Angeles died in 1938. His heirs, the petitioners, later sought to recover the land, claiming the sale was null and void under Section 116 of Act No. 2874 (the Public Land Act). The respondents refused to return the land. The petitioners filed an action in the Court of First Instance of Nueva Ecija. The trial court found the sale null and void but also found that the plaintiffs’ action had prescribed. It ordered the plaintiffs to return the purchase price of P2,500 and reimburse P3,000 for improvements (a dike) before recovering the land. The Court of Appeals reversed the trial court’s judgment, applying the principle of in pari delicto (Article 1306 of the Spanish Civil Code) and dismissing the complaint, ruling that neither party should be granted relief because both knowingly violated the law. The petitioners appealed to the Supreme Court.
ISSUE
The primary issue is whether the doctrine of in pari delicto applies to a sale of a homestead made within the five-year prohibitory period, thereby barring the homesteader’s heirs from recovering the land.
RULING
The Supreme Court reversed the decision of the Court of Appeals. The doctrine of in pari delicto is NOT applicable to sales of homesteads made in violation of the Public Land Act. Such sales are null and void from the beginning. The policy of the homestead law is to preserve land for the homesteader’s family, and the right to recover land sold in violation of this law cannot be waived. Furthermore, an action for the declaration of the inexistence (nullity) of such a void contract does not prescribe. However, while the heirs can recover the land, the equitable principle against unjust enrichment applies to the purchase price. The Court ordered the petitioners (heirs) to return the purchase price of P2,500 to the respondents before they can recover possession of the land. The claims of the petitioners for the value of the fruits/products of the land and the respondents’ claim for reimbursement of the expenses for necessary improvements (the dike) were both dismissed, as both parties are considered in equal fault (in pari delicto) regarding these ancillary matters. The sale was declared null and void.