G.R. No. L-33048 April 16, 1982
EPIFANIA SARSOSA VDA. DE BARSOBIA and PACITA W. VALLAR, petitioners, vs. VICTORIANO T. CUENCO, respondent.

FACTS

The case involves a parcel of coconut land originally owned by petitioner Epifania Sarsosa Vda. de Barsobia, a Filipino citizen. On September 5, 1936, she sold the land to Ong King Po, a Chinese citizen. Ong King Po took possession and enjoyed the fruits. On August 5, 1961, Ong King Po sold the same property to respondent Victoriano T. Cuenco, a naturalized Filipino citizen. Respondent immediately took possession. However, on March 6, 1962, Epifania “usurped” the property. Later, on July 26, 1962, Epifania, through her daughter, sold a one-half portion of the land to petitioner Pacita W. Vallar.
Epifania claimed the 1936 deed was not a true sale but merely evidence of a debt to Ong King Po. Respondent filed a complaint for recovery of possession and ownership. The trial court dismissed the complaint, declaring the deeds of sale void and recognizing Pacita Vallar as a lawful owner. The Court of Appeals reversed, declaring respondent the absolute owner and ordering petitioners to restore possession and pay damages.

ISSUE

The core issue is who has the rightful ownership of the property, considering the initial sale by a Filipino to an alien was constitutionally prohibited, and the subsequent sale by the alien to a naturalized Filipino citizen.

RULING

The Supreme Court affirmed the Court of Appeals’ decision with modification regarding Pacita Vallar’s liability for damages. The 1936 sale from Epifania (Filipino) to Ong King Po (Chinese) was void ab initio under the 1935 Constitution, which prohibited aliens from acquiring private agricultural land. This constitutional provision is an expression of fundamental public policy. Ordinarily, in a suit solely between the original vendor and vendee, the vendor could recover the land based on the void contract, as neither party could seek enforcement.
However, the Court ruled that the principle of laches barred Epifania from asserting her claim. She slept on her rights for 26 years, from 1936 to 1962, before repudiating the sale. Laches is the failure to assert a right for an unreasonable length of time, warranting a presumption of abandonment. Her long inaction and neglect precluded her from recovering the property.
Furthermore, the subsequent sale from Ong King Po to respondent Cuenco, a naturalized Filipino, validated the chain of title. While Ong King Po had no valid ownership to transmit due to the void initial sale, the ultimate transfer to a qualified Filipino citizen achieved the constitutional purpose of conserving land for Filipinos. Respondent, having purchased in good faith and taken possession, was declared the rightful owner. The award of actual damages representing lost income from the land was justified against Epifania, but not against Pacita Vallar, who was a vendee in good faith from Epifania. Attorney’s fees were also properly awarded.