LAW ON PROPERTY | ROMAN CATHOLIC ARCHBISHOP OF MANILA V. COURT OF APPEALS 198 SCRA 300, JUNE 19, 1991
ROMAN CATHOLIC ARCHBISHOP OF MANILA V. COURT OF APPEALS
198 SCRA 300, JUNE 19, 1991
TOPIC/DOCTRINE
Validity of a stipulation in the deed of donation providing for the
automatic reversion of the donated property to the donor upon non-compliance of
the condition was upheld in the recent case of De Luna et. al, vs Abrigo, et.
al.
Although
the donor may impose certain conditions in the deed of donation, the same must
not be contrary to law, morals, good customs, public order and public policy.
FACTS
The cause of action of
private respondents is based on the alleged breach by petitioners of the
resolutory condition in the deed of donation that the property donated should
not be sold within a period of one hundred (100) years from the date of
execution of the deed of donation. Said condition, in our opinion, constitutes
an undue restriction on the rights arising from ownership of petitioners and
is, therefore, contrary to public policy.
ISSUE
Whether the
condition imposed in the deed of donation in the case before us constitutes a
patently unreasonable and undue restriction on the right of the donee to
dispose of the property donated, which right is an indispensable attribute of
ownership.
RULING
Yes.
The court ruled that donation, as a mode of acquiring ownership,
results in an effective transfer of title over the property from the donor to
the donee. Once a donation is accepted, the donee becomes the absolute owner of
the property donated. Although the donor may impose certain conditions in the
deed of donation, the same must not be contrary to law, morals, good customs,
public order and public policy. The condition imposed in the deed of donation
in the case before us constitutes a patently unreasonable and undue restriction
on the right of the donee to dispose of the property donated, which right is an
indispensable attribute of ownership. Such a prohibition against alienation, in
order to be valid, must not be perpetual or for an unreasonable period of time.
Here, the court ruled that the prohibition in the deed of
donation against the alienation of the property for an entire century, being an
unreasonable emasculation and denial of an integral attribute of ownership,
should be declared as an illegal or impossible condition within the
contemplation of Article 727 of the Civil Code. Consequently, as specifically
stated in said statutory provision, such condition shall be considered as not
imposed. No reliance may accordingly be placed on said prohibitory paragraph in
the deed of donation.
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Whether judicial
declaration revoking the deed of donation is necessary (NO).
The court ruled that there is nothing in the law that prohibits the parties from entering
into an agreement that a violation of the terms of the contract would cause its
cancellation even without court intervention. Validity of a stipulation in the
deed of donation providing for the automatic reversion of the donated property
to the donor upon non-compliance of the condition was upheld in the recent case
of De Luna et. al, vs Abrigo, et. al. The rationale for the foregoing is
that in contracts providing for automatic revocation, judical intervention is
necessary not for purposes of obtaining a judicial declaration rescinding a
contract already deemed rescinded by virtue of an agreement providing for
rescission even without judicial intervention, but in order to determine
whether or not the rescission was proper.
Here, the court ruled that although it
is true that under Article 764 of the Civil Code an action for the revocation
of a donation must be brought within four (4) years from the non-compliance of
the conditions of the donation, the same is not applicable in the case at bar.
The deed of donation involved herein expressly provides for automatic reversion
of the property donated in case of violation of the condition therein, hence a
judicial declaration revoking the same is not necessary.
Whether the
action has prescribed. (NO)
The court
ruled that Court of Appeals committed
no error in holding that the cause of action of private respondents has not yet
prescribed since an action to enforce a written contract prescribed in ten (10)
years.
It is our view that
Article 764 was intended to provide a judicial remedy in case of
non-fulfillment or contravention of conditions specified in the deed of
donation if and when the parties have not agreed on the automatic revocation of
such donation upon the occurrence of the contingency contemplated therein. That
is not the situation in the case at bar.
