G.R. No. 158377 - HEIRS OF JOSE REYES, JR., NAMELY: MAGDALENA C. REYES, OSCAR C. REYES, GAMALIEL C. REYES, NENITA R. DELA CRUZ, RODOLFO C. REYES, AND RODRIGO C. REYES, VS. AMANDA S. REYES, CONSOLACION S. REYES, EUGENIA R. ELVAMBUENA, LUCINA R. MENDOZA, PEDRITO S. REYES, MERLINDA R. FAMODULAN, EDUARD

Ruling

WHEREFORE, it is respectfully prayed that judgment be rendered: Quieting the title to the property by declaring the plaintiffs ( respondents herein) as the rightful and lawful owners thereof; Ordering the defendants ( petitioners herein) to vacate subject premises and reconvey and or surrender possession thereof to the plaintiffs; Ordering the defendants to recognize the right of the plaintiffs as the lawful owners of subject property; Ordering the defendants to pay plaintiffs the following: Moral damages in the amount of P50,000.00; Exemplary damages in the amount of P20,000.00; Attorney's fees of P20,000.00, acceptance fee of P10,000.00 and P500.00 per recorded Court appearance of counsel; The costs of this suit. Plaintiffs further pray for such other relief which the Honorable Court may deem just and equitable under the premises. [18] In their answer, [19] the petitioners averred that the Kasulatan ng Biling Mabibiling Muli was an equitable mortgage, not a pacto de retro sale; that the mortgagors had retained ownership of the property; that the heirs of the Spouses Francia could not have validly sold the property to Alejandro through the Pagsasaayos ng Pag-aari at Pagsasalin; that Alejandro's right was only to seek reimbursement of the P500.00 he had paid from the co-owners, namely: Leoncia, Teofilo, Jose, Jr. and Jose, Sr. and the heirs of Potenciana; and that Alejandro could not have also validly consolidated ownership through the Kasulatan ng Pagmeme-ari, because a consolidation of ownership could only be effected via a court order. The petitioners interposed a counterclaim for the declaration of the transaction as an equitable mortgage, and of their property as owned in common by all the heirs of Leoncia, Teofilo, Jose, Jr. and Jose, Sr. On May 21, 1996, the RTC ruled in favor of the respondents, declaring that Alejandro had acquired ownership of the property in 1965 by operation of law upon the failure of the petitioners' predecessors to repurchase the property; that the joint affidavit executed by Alejandro, Leoncia and Jose, Jr. and Jose, Sr., to extend the period of redemption was inefficacious, because there was no more period to extend due to the redemption period having long lapsed by the time of its execution; and that the action should be dismissed insofar as the heirs of Potenciana were concerned, considering that Potenciana, who had predeceased her parents, had no successional rights in the property. Accordingly, the RTC decreed as follows: WHEREFORE, on the basis of the evidence adduced and the law/jurisprudence applicable thereon, judgment is hereby rendered: a) sustaining the validity of the "Kasulatan ng Biling Mabibiling Muli" (Exh. B/Exh. 1) executed on July 9, 1955 by Leoncia Mag-isa and her sons Teofilo, Jose, Sr. and Jose, Jr., all surnamed Reyes, in favor of Spouses Benedicto Francia and Monica Ajoco as well as the "Pagsasa-ayos ng Pag-aari at Pagsasalin" (Settlement of Estate and Assignment) [Exh. C/Exh. 4] executed o