In the case of Soledad Cañezo v. Concepcion Rojas, the Supreme Court addressed the issue of recovering real property allegedly held in trust. The Court ruled that the petitioner’s claim was barred by prescription and laches because no express or implied trust existed between her and her father. This means that a long period of uninterrupted possession, coupled with acts of ownership, can ripen into ownership, even if there was an initial agreement or understanding.

Faded Memories or Forgotten Rights? The Battle for Higatangan Land

The story begins with Soledad Cañezo, who claimed to have bought a parcel of land in Higatangan, Naval, Biliran, in 1939. After moving to Mindanao in 1948, she entrusted the land to her father, Crispulo Rojas. Decades later, in 1997, Soledad discovered that her stepmother, Concepcion Rojas, was in possession of the land and that the tax declaration was in Crispulo’s name. This prompted Soledad to file a complaint to recover the property. The central legal question was whether a trust relationship existed between Soledad and her father, and if so, whether her right to recover the property had been extinguished by prescription or laches.

The Municipal Trial Court (MTC) initially ruled in favor of Soledad, but the Regional Trial Court (RTC) reversed this decision, citing prescription. While the RTC later amended its decision, holding that the action had not yet prescribed because of the trust relationship, the Court of Appeals (CA) ultimately reversed the RTC’s amended decision, finding that Soledad’s claim was barred by laches and prescription. The CA emphasized Soledad’s inaction for many years, casting doubt on her ownership claim and pointing to Crispulo’s long-term possession and tax payments as indicators of ownership. The Supreme Court then took up the case to resolve these conflicting decisions.

The Supreme Court began its analysis by addressing the procedural issue of whether the CA erred in granting the respondent’s motion for an extension of time to file the petition for review. The Court held that granting or denying a motion for extension of time is within the sound discretion of the court, and absent any abuse of discretion, the CA’s decision would not be disturbed. Turning to the substantive issue, the Court examined whether a trust relationship existed between Soledad and her father. This was crucial because, under the law, a trustee cannot acquire by prescription property entrusted to him unless he repudiates the trust.

A **trust** is a legal relationship where one person holds legal title to property for the benefit of another. **Express trusts** are created intentionally, either in writing or orally, while **implied trusts** are deduced from the nature of the transaction or imposed by law. The Court emphasized that proving the existence of a trust rests on the party asserting it, with the proof needing to be clear and satisfactory. The elements of a trust include a trustor, a trustee, the trust property, and the beneficiary. The Civil Code specifies that express trusts concerning real property cannot be established by parol evidence.
Article 1443 of the Civil Code states:

No express trusts concerning an immovable or any interest therein may be proved by parol evidence.

In this case, the only evidence presented by Soledad was her own testimony, which the Court deemed insufficient to establish an express trust. The Court noted that there was no written document or deed evidencing the creation of a trust, and her testimony about receiving a share of the property’s produce did not necessarily indicate a trust relationship. This highlighted the need for concrete evidence to establish a clear intention to create a trust, rather than relying on vague or ambiguous declarations. Further, the Court noted that profit-sharing, does not necessarily translate to a trust relation and could be seen in other relations, such as deposit.

The Court then turned to the possibility of an **implied trust**, specifically a **resulting trust**. A resulting trust is presumed to have been contemplated by the parties based on the nature of their transaction, even if not explicitly stated. The Court noted that while implied trusts may be proven by oral evidence, such evidence must be trustworthy and received with extreme caution. In this case, there was no evidence of any transaction between Soledad and her father that would support the inference of a resulting trust. The burden of providing trustworthy evidence to satisfy the court of this resulting trust rests on the petitioner, but it was sadly not met.

Without a trust relationship, the Court concluded that Crispulo’s uninterrupted possession of the property for 49 years, combined with his acts of ownership such as paying real estate taxes, ripened into ownership through **acquisitive prescription**.
Section 41 of Act No. 190 (Code of Civil Procedure), states:

Ten years actual adverse possession by any person claiming to be the owner for that time of any land or interest in land, uninterruptedly continued for ten years by occupancy, descent, grants, or otherwise, in whatever way such occupancy may have commenced or continued, shall vest in every actual occupant or possessor of such land a full and complete title.

The Court explained that while tax declarations and receipts are not conclusive evidence of ownership, they constitute strong evidence when coupled with actual possession. This emphasized the importance of not only possessing property but also actively demonstrating ownership through actions such as paying taxes and making improvements.

Even if a trust relationship had existed, the Court noted, it would have terminated upon Crispulo’s death in 1978 because the trust was personal to him. After Crispulo’s death, a **constructive trust** would have been created, where the respondent mistakenly retained property rightfully belonging to another. However, the Court clarified that prescription may supervene in constructive implied trusts, even without repudiation. The key difference is that constructive trusts do not emanate from a fiduciary relationship, and the trustee’s possession is considered adverse from the beginning.

The Court also highlighted several other factors that weighed against Soledad’s case. First, she was estopped from asserting ownership because she failed to contest the inclusion of the property in her father’s estate. This inaction, the Court said, induced others to believe that the property was part of the estate. Second, her action was barred by **laches**, which is the failure to assert a right within a reasonable time. In this case, Soledad waited 17 years after discovering that the respondent was in possession of the property before filing her claim. Finally, the Court agreed with the respondent’s argument that other co-owners were indispensable parties to the case and should have been impleaded.

In essence, the Supreme Court affirmed the Court of Appeals’ decision, emphasizing the significance of long-term possession and the need for clear and convincing evidence to establish a trust relationship. The ruling highlights the principle that inaction can lead to the loss of rights and that demonstrating ownership through continuous possession and payment of taxes strengthens a claim of ownership.

FAQs

What was the key issue in this case?	The key issue was whether Soledad Cañezo could recover real property from Concepcion Rojas, based on the claim that her father held the property in trust for her. The Court determined whether a trust existed and if prescription or laches barred the claim.
What is an express trust?	An express trust is created by the clear and direct intention of the parties, typically through a written agreement or deed. It requires a trustor, trustee, trust property, and a beneficiary, and it must be proven by some form of documentation.
What is an implied trust?	An implied trust arises by operation of law, either as a resulting trust or a constructive trust. A resulting trust is presumed to have been intended by the parties, while a constructive trust is imposed to prevent unjust enrichment.
What is acquisitive prescription?	Acquisitive prescription is a means of acquiring ownership of property through continuous and uninterrupted possession for a specified period. Under Act No. 190, ten years of adverse possession can ripen into full ownership.
What is laches?	Laches is the unreasonable delay in asserting a right, which leads to a presumption that the party has abandoned it. It is based on equity and prevents parties from pursuing stale claims.
What evidence is needed to prove a trust?	For express trusts involving real property, written evidence is required. For implied trusts, oral evidence is admissible but must be trustworthy and convincing.
Can a trustee acquire ownership of the trust property?	Generally, a trustee cannot acquire ownership of the trust property through prescription unless they repudiate the trust and the beneficiary is aware of the repudiation. However, this rule does not always apply to constructive trusts.
Why was Soledad’s claim ultimately denied?	Soledad’s claim was denied because she failed to provide sufficient evidence of an express or implied trust, and Crispulo Rojas had possessed the property openly and continuously for many years, leading to acquisitive prescription. Additionally, her claim was barred by laches and estoppel.
Are all co-owners necessary parties in a property dispute?	Yes, when a case involves ownership of property, all co-owners are considered indispensable parties. Their presence is required for the court to render a valid and effective judgment.

In conclusion, the case of Soledad Cañezo v. Concepcion Rojas underscores the importance of asserting one’s rights in a timely manner and the need for clear evidence to support claims of ownership and trust relationships. The Supreme Court’s decision serves as a reminder that long-term possession, coupled with demonstrable acts of ownership, can have significant legal consequences.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: SOLEDAD CAÑEZO v. CONCEPCION ROJAS, G.R. No. 148788, November 23, 2007