G.R. No. 109355 - SERAFIN MODINA VS. COURT OF APPEALS AND

Ruling

WHEREFORE, judgment is hereby rendered (1) declaring as void and inexistent the sale of Lots 10063, 10088, 10085 and 10089 of the Cadastral Survey of Sta. Barbara by Merlinda Plana in favor of Ramon Chiang as evidenced by the deed of definite sale dated December 17, 1975 (Exhibits H; 3-Chiang; 9 Intervenor) as well as the Certificates of Title Nos. T-86912, T-86913, T-86914 and T-86915 in the name of Ramon Chiang; (2) declaring as void and inexistent the sale of the same properties by Ramon Chiang in favor of Serafin Modina as evidenced by the deeds of sale (Exhibits A, B, 6 Chiang and 7 Chiang) dated August 3, and 24, 1979, as well as. Certificates of Title Nos. T-102631, 102630, 102632 and 102890 in the name of Serafin Modina; (3) ordering the Register of Deeds of Iloilo to cancel said certificates of title in the names of Ramon Chiang and Serafin Modina and to reinstate the Certificates of Title Nos. T-57960, T-57962, T-57963 and T-57864 in the name of Nelson Plana; (4) ordering Serafin Modina to vacate and restore possession of the lots in question to Merlinda Plana Chiang; (5) ordering Ramon Chiang to restitute and pay to Serafin Modina the sum of P145,800.00 and; (6) ordering Serafin Modina to pay Ernesto Hontarciego the sum of P44,500.00 as actual and compensatory damages plus the sum of P5,000.00, for and as attorneys fees, with costs in favor of said defendants against the plaintiff. On appeal, the Court of Appeals affirmed the aforesaid decision in toto . Dissatisfied therewith, petitioner found his way to this Court via the present Petition for Review under Rule 45 seeking to set aside the assailed decision of the Court of Appeals. Raised for resolution here are: (1) whether the sale of subject lots should be nullified, (2) whether petitioner was not a purchaser in good faith, (3) whether the decision of the trial court was tainted with excess of jurisdiction; and (4) whether or not only three-fourths of subject lots should be returned to the private respondent. Anent the first issue, petitioner theorizes that the sale in question is null and void for being violative of Article 1490 [3] of the New Civil Code prohibiting sales between spouses. Consequently, what is applicable is Article 1412 [4] supra on the principle of in pari delicto , which leaves both guilty parties where they are, and keeps undisturbed the rights of third persons to whom the lots involved were sold; petitioner stressed. Petitioner anchors his submission on the following statements of the Trial Court which the Court of Appeals upheld, to wit: Furthermore, under Art. 1490, husband and wife are prohibited to sell properties to each other. And where, as in this case, the sale is inexistent for lack of consideration, the principle of in pari delicto non oritur actio does not apply. (Vasquez vs Porta, 98 Phil 490). (Emphasis ours) Thus, Art. 1490 provides: Art. 1490. The husband and the wife cannot sell property to each other, except: (1) when a sep