G.R. No. L-6184; February 28, 1958
VICENTE SANTANDER, the heirs of the late FORTUNATA VILLINISO named CONSTANCIO, MATIAS, GENOVEVA, PAZ, JOSE, IRENEO, and ANATALIA all surnamed SANTANDER and CRISPULO TAJANLANGIT, plaintiffs-appellants, vs. MANUEL VILLANUEVA and CELEDONIA ASUNCION, defendants-appellees.

FACTS

On July 29, 1937, a homestead patent was granted to appellant Vicente Santander, and Original Certificate of Title No. 1497 was issued on July 8, 1938. On February 26, 1942, Santander signed a document purporting to be an absolute sale of a two-hectare portion of this homestead to Celedonia Asuncion for P480. The deed stipulated it would become effective only after approval by the authorities, and possession was transferred to the buyer. On November 2, 1948, Santander and his children (heirs of his deceased wife) filed an action to recover the land, claiming it was merely mortgaged to secure a P180 loan. The defendants asserted it was a valid sale, presenting the deed and its subsequent approval by the Secretary of Agriculture and Commerce on August 2, 1947. The trial court found the sale genuine but null and void for being executed within the five-year prohibitive period under Section 118 of Commonwealth Act No. 141. However, noting the land’s value had greatly increased and that Santander was engaged in speculation, the court ordered the plaintiffs to repurchase the land at its present value of P60,000 and recommended cancellation of Santander’s patent.

ISSUE

Whether the lower court erred in ordering the appellants to pay P60,000 as the repurchase price for the land after declaring the deed of sale null and void, despite the stipulated consideration being only P480.

RULING

Yes, the lower court erred. The Supreme Court affirmed that the sale was null and void ab initio because it was executed within five years from the issuance of the homestead patent, which is prohibited by mandatory law. The subsequent approval by the Secretary of Agriculture and Commerce could not validate a void sale, especially as it was based on a mistaken assumption that the patent was issued in 1936. Since the sale was void from the beginning, the appellants never lost ownership. The appellees, being in pari delicto (in equal fault) for buying land they knew or should have known could not be legally sold, are entitled only to recover the purchase price of P480. The Supreme Court modified the decision, ordering appellants to return P480 to appellees, and appellees to restore possession of the land to appellants. The Court also affirmed the referral to the Director of Lands for investigation and possible forfeiture of Santander’s homestead under Section 124 of the Public Land Law.