G.R. No. 136197 - NATIVIDAD BAUTISTA-BORJA, VS. ILUMINADA BAUTISTA, AUREA BAUTISTA-RUIZ, CLARITA BAUTISTA, FLORENTINO BAUTISTA, DIOSDADO BAUTISTA, FRANCISCO BAUTISTA II, FRANCISCO BAUTISTA III, DANILO BAUTISTA, LUZVIMINDA BAUTISTA, ARTURO BAUTISTA, LUZ BAUTISTA AND PAULINO BAUTISTA. D E C I S I O N

Ruling

accordingly prayed as follows: Ordering the partition of the properties of spouses Pablo Bautista and Segundina Tadiaman Bautista; Declaring as null and void and without any force and effect the deed of sales and/or other documents executed to cancel and effect the transfer of the properties of Pablo Bautista and his wife to the defendants; x x x x [3] (Underscoring supplied) By Order of September 27, 1994, Branch 35 of the Santiago RTC, acting on the Motion to Dismiss [4] filed by respondents which was anchored on lack of cause of action, prescription and laches, dismissed the complaint. It held that petitioner's complaint, though denominated as one for annulment of sale, was in fact based on an obligation conferred by law, specifically an implied trust, hence, pursuant to Articles 1456 [5] and 1144 [6] of the Civil Code, it had prescribed, the same having been filed 20 years after the implied trust commenced. In another vein, the trial court held that petitioner's cause of action had prescribed as actions for reconveyance based on implied trust prescribe in 10 years, and that laches had set in. Petitioner elevated the case to the Court of Appeals, contending that the nature of her complaint was one for annulment of void contracts, hence, imprescriptible; that laches does not apply, following Palmera v. Civil Service Commission [7] which held that "x x x where a defendant or those claiming under him recognized or directly or impliedly acknowledged the existence of the right asserted by a plaintiff, such recognition may be invoked as a valid excuse for plaintiff's delay in seeking to enforce such right"; that, contrary to the trial court's ruling, her cause of action had not prescribed, as "an action to compel the trustee to convey the property registered in his name for the benefit of the cestui que trust does not prescribe"; and that the prescriptive period commences to run only when the trustee repudiates the trust through unequivocal acts made known to the cestui que trust --- an element not satisfactorily shown in the instant case. By Decision of October 30, 1998, [8] the appellate court affirmed the trial court's ruling, citing Salvatierra v. Court of Appeals [9] which held "that an action for reconveyance of registered land based on implied trust, prescribes in ten (10) years even if the decree of registration is no longer open to review." The appellate court went on to hold that petitioner was guilty of laches, and assuming that the transfer of the properties in favor of respondents was procured through fraud, still, her action should have been filed within four years from the discovery of the fraud. Hence, this petition, petitioner insisting that since her cause of action is for annulment or declaration of inexistent contracts, the provisions on void contracts, specifically Arts. 1390 [10] and 1391 [11] of the Civil Code, apply, hence, her cause of action had not prescribed, for under Article 1410 of the Civil Code, "the action or defens