4. MAXIMA HEMEDES & R & B INSURANCE CORPORATION, petitioner V.

COURT OF APPEALS, ET. AL., respondents.

FACTS:
o Deceased husband, Jose Hemedes donated a parcel of land in favour of his third wife,
Justa Kausapin, subject to a resolutory condition that said land be reverted back to his
children (Maxima, petitioner and Enrique, private respondent) or heirs, if Justa
Kausapin should die or remarry.
o Pursuant to said condition, Justa Kausapin executed a “Deed of Conveyance of
Unregistered Real Property by Reversion,” conveying to Maxima Hemedes the subject
property. Said document granted Justa Kausapin usufructuary rights over the property
during her lifetime or widowhood.
o By virtue of said deed of conveyance, Maxima caused the registration of the subject
property under her name. At a later date, Maxima and her husband, obtained a loan
amounting to P6,000.00 from R & B Insurance, and executed a real estate mortgage over
the subject property as security thereof.
o For failure of the spouses to pay the loan despite repeated demands, R & B Insurance
extrajudicially foreclosed the mortgage. The property was sold at a public auction with R
& B Insurance as the highest bidder. Since Maxima and her husband failed to redeem the
property within the redemption period, title of the subject property was subsequently
transferred to R & B with TCT No. 41 985.
o Despite the earlier conveyance of the subject land in favour of Maxima, Justa Kausapin
executed a “Kasunduan” whereby she transferred the same land to Enrique Hemedes.
Further, she issued an affidavit confirming the above conveyance to Enrique and at the
same time repudiating her prior conveyance to Maxima. Pursuant to such documents,
Enrique was able to obtain two declarations of real property. Since then, he had been
paying the real property taxes of the subject property.
o At a later date, Enrique sold the property to Dominium Realty and Construction
Corporation. Dominium then leased the property to its sister corporation Asia Brewery,
Inc. who constructed two warehouses therein. Upon learning of Asia Brewery’s
constructions, R & B Insurance sent a letter informing the former of its ownership of the
property. A conference was held between R & B Insurance and Asia Brewery but the two
companies failed to arrive at an amicable settlement.
o Maxima Hemedes also wrote a letter addressed to Asia Brewery asserting that she is the
rightful owner of the subject property and denying the execution of any real estate
mortgage in favour of R & B Insurance.
o This compelled Domimium and Enrique Hemedes to file a complaint with CFI for the
annulment of the TCT issued in favour of R & B Insurance and for the issuance of title in
favour of Dominium, alleging that the latter is the absolute owner of the subject
property.

o The trial court ruled in favour of private respondents. In ruling thus, it gave credence to
the affidavit executed by Justa Kausapin repudiating the deed of conveyance in favour of
Maxima and affirming the authenticity of the “Kasunduan” in favour of Enrique. Also, it
considered as pivotal the fact that the deed of conveyance in favour of
Maxima was in English and that it was not explained to Justa Kausapin,
 although she could not read nor understand English. Thus, Maxima failed to
discharge her burden, pursuant to Art. 1332 of the Civil Code, to show that
the terms thereof were fully explained to Justa Kausapin.

o The CA affirmed the lower court’s ruling. Hence, this petition.

ISSUEs:
1. WON Art. 1332 is applicable in the case above. (Kani lang focus)

2. WON the donation in favour of Enrique Hemedes contained in the

“Kasunduan” was valid. (Just in case mag –ask si Atty.)

RULING: SC both ruled in the negative.

Issue No. 1:

Art. 1332 is inapplicable in this case since it could not be determined from the facts
above whether or not Justa Kausapin, at the time she executed the deed of conveyance in favour
of Maxima, did not understand the terms and language of the document and whether or not, she
was induced by Maxima in placing her thumb mark in such document. The court gave credence
to the following contentions of Maxima:

a. First, the “Deed of Donation Intervivos With Resolutory Condition” issued by deceased
husband, Jose Hemedes in favour of Justa Kausapin was also in English, yet she never
alleged that she did not understand the same;

b. Second, Justa Kausapin failed to prove that it was not her thumb mark on the deed of
conveyance in favour of Maxima and in fact, Enrique and Dominium objected to
the request of Maxima’s counsel to obtain a specimen thumb mark of Justa
Kausapin.

Hence, it was private respondent’s own allegations which render Art. 1332
inapplicable for it is useless to determine whether or not Justa Kausapin was induced to
execute said deed of conveyance by means of fraud employed by Maxima, who allegedly
took advantage of the fact that the former could not understand English. By not allowing
the Justa Kausapin’s specimen, which could have cleared the doubts as to whether or not
the deed was forged, to be examined, Enrique upheld the legal presumption that
evidence wilfully suppressed would be adverse if produced. The failure of private
respondents to refute the due execution of the deed of conveyance by
making a comparison with Justa Kausapin’s thumbmark necessarily leads
one to conclude that she did in fact affix her thumbmark upon the deed of
donation in favor of Maxima.

Issue No. 2:

Enrique Hemedes and his transferee, Dominium, did not acquire any rights over the
subject property. Prior to the execution of the “Kasunduan,” ownership of the subject property
was already transferred to Maxima. Hence, such subsequent donation in favour of Enrique is
null and void for the purported object thereof did not exist at the time of transfer, having already
been transferred to his sister. Similarly, the sale of the subject property by Enrique to Dominium
is also a nullity for the latter cannot acquire more rights that its predecessor-in-interest and is
definitely not an innocent purchaser for value since Enrique did not present any certificate of
title upon which it relied.

The declarations id real property in favour of Enrique cannot defeat a certificate of title,
which is an absolute and indefeasible evidence of ownership of the property in favour of the
person whose name appears therein. Particularly, with regard tax declarations and tax receipts,
this Court has held on several occasions that the same do not by themselves conclusively prove
title to land.

CA decision is reversed. Title should be vested to R & B pursuant to TCT No.

41985.