G.R. No. 179540 - PERFECTA CAVILE, JOSE DE LA CRUZ AND RURAL BANK OF BAYAWAN, INC., VS. JUSTINA LITANIA-HONG, ACCOMPANIED AND JOINED BY HER HUSBAND, LEOPOLDO HONG AND GENOVEVA LITANIA. D E C I S I O N - Supreme Court E-Library

Ruling

WHEREFORE, premises considered, judgment is hereby rendered declaring [herein petitioner spouses] as the absolute owners over the parcels of land in litigation. Consequently, [herein respondents'] complaint is ordered dismissed. [Respondents'] counterclaim is likewise entered dismissed for lack of merit. [14] The RTC ruled that the petitioner spouses' evidence was more worthy of credence in establishing their ownership of the subject lots. As petitioner Perfecta testified before the RTC, Castor immediately took possession of the subject lots after the Deed of Partition was executed in 1937. This fact was supported by the unrebutted testimony of Luciana Navarra, petitioner Perfecta's cousin, who declared that her husband was petitioner Perfecta's tenant on the subject lots since 1947 and that respondents never actually occupied the said properties. The RTC observed that it was highly questionable and contrary to human experience that respondents waited nine long years after their ejection from the subject lots in 1965 before taking any legal step to assert their rights over the same. The RTC further subscribed to the testimony of Perfecta that the Confirmation of Extrajudicial Partition was executed by Castor solely to accommodate Susana, enabling her to obtain a bank loan using the subject lots as collateral. It noted that Susana did not bother to apply for the issuance of title to the subject lots in her name. Contrarily, it was Perfecta who applied for and obtained title to the subject lots, which, surprisingly, respondents were not even aware of. The RTC found that the contemporaneous and subsequent acts of the parties after the execution of the Confirmation of Extrajudicial Partition evidently demonstrated their intention to merely accommodate Susana in her loan application. Hence, the RTC concluded that the Confirmation of Extrajudicial Partition was a simulated contract which was void and without any legal effect. Without seeking a reconsideration of the above RTC Decision, respondents challenged the same by way of appeal before the Court of Appeals, docketed as CA-G.R. CV No. 66873. On 8 March 2007, the Court of Appeals rendered the assailed Decision in favor of respondents, the decretal portion of which provides: WHEREFORE , the assailed decision is REVERSED AND SET ASIDE and a new one entered ORDERING [herein petitioner spouses] and/or their heirs, assigns and representatives as follows: To reconvey to [herein respondents] the possession and title to the litigated parcels of land. Upon reconveyance of the litigated properties, the Register of Deeds of Dumaguete City is ordered to cancel Certificate of Title No. 4877 (sic), 4976 and 4978 and to issue a new certificate to [respondents] or their successors in interest. With costs against [petitioner spouses]. [15] The Court of Appeals agreed in the respondents' contention that the Confirmation of Extrajudicial Partition was not a simulated document. The said document should be entitled to u