VOL.

397, FEBRUARY 11, 2003 271

Castro vs. Miat

*
G.R. No. 143297. February 11, 2003.

Spouses VIRGILIO and MICHELLE CASTRO, MOISES B.

MIAT and ALEXANDER V. MIAT, petitioners, vs. ROMEO
V. MIAT, respondent.

Husband and Wife; Marriage; Conjugal Partnership; Where

the spouses were married before the effectivity of the Family Code,
the provisions of the New Civil Code apply.Since Moises and
Concordia were married before the effectivity of the Family Code,
the provisions of the New Civil Code apply. Article 153(1) of the
New Civil Code provides as follows: The following are conjugal
partnership property: (1) Those acquired by onerous title during
the marriage at the expense of the common fund, whether the
acquisition be for the partnership, or for only one of the spouses; x
x x. The records show that the Paco property was acquired

_______________

* THIRD DIVISION.

272

272 SUPREME COURT REPORTS ANNOTATED

Castro vs. Miat

by onerous title during the marriage out of the common fund. It is

clearly conjugal property.
 Same; Same; Same; Art. 160 of the New Civil Code, which
provides that all property of the marriage is presumed to belong to
the conjugal partnership, does not require proof that the property
was acquired with funds of the partnershipthe presumption
applies even when the manner in which the property was acquired
does not appear.Petitioners also overlook Article 160 of the New
Civil Code. It provides that all property of the marriage is
presumed to belong to the conjugal partnership, unless it be
proved that it pertains exclusively to the husband or to the wife.
This article does not require proof that the property was acquired
with funds of the partnership. The presumption applies even
when the manner in which the property was acquired does not
appear.
Settlement of Estates; Partition; Statute of Frauds; Without
creditors to take into consideration, it is competent for the heirs of
an estate to enter into an agreement for distribution thereof in a
manner and upon a plan different from those provided by the rules
from which, in the first place, nothing can be inferred that a
writing or other formality is essential for the partition to be valid;
The Statute of Frauds under Article 1403 of the New Civil Code
does not apply to an extrajudicial partition among heirs for it is
not legally deemed a conveyance of real property, considering that
it involves not a transfer of property from one to the other but
rather, a confirmation or ratification of title or right of property
that an heir in renouncing in favor of another heir who accepts
and receives the inheritance.We also hold that the oral partition
between Romeo and Alexander is not covered by the Statute of
Frauds. It is enforceable for two reasons. Firstly, Alexander
accepted the six thousand (P6,000.00) pesos given by Romeo as
downpayment for the purchase of his share in the Paco property.
Secondly, Romeo and his witnesses, Ceferino Miat and Pedro
Miranda, who testified regarding the sale of Alexanders share to
Romeo, were intensely questioned by petitioners counsel. In the
recent case of Pada-Kilario vs. Court of Appeals, we held: [N]o
law requires partition among heirs to be in writing and be
registered in order to be valid. The requirement in Sec. 1, Rule 74
of the Revised Rules of Court that a partition be put in a public
document and registered, has for its purpose the protection of
creditors and the heirs themselves against tardy claims. The
object of registration is to serve as constructive notice to others. It
follows then that the intrinsic validity of partition not executed
with the prescribed formalities is not undermined when no
creditors are involved. Without creditors to take into
consideration, it is competent for the heirs of an estate to enter
into an agreement for distribution thereof in a manner and upon a
plan different from those provided by the rules from which, in the
first place, nothing can be inferred that a writing or other
formality is essential for the partition to be valid. The partition of
inherited property need not be embodied in a

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Castro vs. Miat

public document so as to be effective as regards the heirs that

participated therein. The requirement of Article 1358 of the Civil
Code that acts which have for their object the creation,
transmission, modification or extinguishment of real rights over
immovable property, must appear in a public instrument, is only
for convenience, non-compliance with which does not affect the
validity or enforceability of the acts of the parties as among
themselves. And neither does the Statute of Frauds under Article
1403 of the New Civil Code apply because partition among heirs is
not legally deemed a conveyance of real property, considering that
it involves not a transfer of property from one to the other but
rather, a confirmation or ratification of title or right of property
that an heir is renouncing in favor of another heir who accepts
and receives the inheritance. x x x.
Sales; Purchasers in Good Faith; Words and Phrases; A
purchaser in good faith is one who buys property and pays a full
and fair price for it at the time of the purchase or before any notice
of some other persons claim on or interest in it; A buyer of real
property which is in the possession of persons other than the seller
must be wary and should investigate the rights of those in
possession.The appellate court also correctly held that the
petitioners-spouses Castro were not buyers in good faith. A
purchaser in good faith is one who buys property and pays a full
and fair price for it at the time of the purchase or before any
notice of some other persons claim on or interest in it. The rule is
settled that a buyer of real property, which is in the possession of
persons other than the seller, must be wary and should
investigate the rights of those in possession. Otherwise, without
such inquiry, the buyer can hardly be regarded as buyer in good
faith.

PETITION for review on certiorari of a decision of the

Court of Appeals.

The facts are stated in the opinion of the Court.

Antonio C. Gorospe for petitioners.
Pantaleon Law Office for private respondent.

PUNO, J.:

This is a petition for review on certiorari of the decision

rendered by the Court of Appeals in CA-G.R. CV No. 43053,
entitled Romeo V. Miat vs. Spouses Virgilio and Michelle
Castro, Moises B. 1Miat and Alexander V. Miat, dated
November 29, 1999.

_______________

1 The appellate courts decision modified that rendered by the trial

court on March 17, 1993 in Civil Case No. 89-48182.

274

274 SUPREME COURT REPORTS ANNOTATED

Castro vs. Miat

The evidence shows that the spouses Moises and Concordia

Miat bought two (2) parcels of land during their coverture.
The first is located at Wawa
2
La Huerta, Airport Village,
Paraaque,
3
Metro Manila and covered by 4 TCT No. S-
33535. The second is 5located at Paco, Manila, and covered
by TCT No. 163863. Concordia died on April 30, 1978.
They had two (2) children: Romeo and Alexander.
While at Dubai, United Arab Emirates, Moises agreed
that the Paraaque and 6
Paco properties would be given to
Romeo and Alexander. However, when Moises returned in
1984, he renegotiated the agreement with Romeo and
Alexander. He wanted the Paraaque property for himself
but would7
leave the Paco property to his two (2) sons. They
agreed.
It appears that Moises and Concordia bought8 the Paco
property on installment basis on May 17, 1977. However,
it was only on December
9
14, 1984 that Moises was able to
pay its balance. He secured10
the title over the property in
his name as a widower. According to Romeo, Moises
violated the agreement that their (Romeos and
Alexanders) names would11
be registered in the title once
the balance was paid. Upon demand, Moises gave the
owners duplicate of the Paco property title to Romeo.
Romeo and Alexander lived on the Paco property. They 12
paid its realty taxes and fire insurance premiums. In
early August 1985,

_______________

2 TSN (Romeo Miat), December 9, 1989, p. 9.

3 Exhibit I, Original Record, p. 258. TCT No. S-27754 covering 264
square meters (Exhibit G, Original Record, pp. 254-255), was issued
originally to Moises and Concordia Miat on May 6, 1976. After 1/2 of the
property was sold to Trancilacion Miranda Ligas [TSN (Romeo Miat),
February 21, 1991, p. 28], TCT No. S-33535 covering 132 square meters,
was issued on August 30, 1976.
4 TSN (Romeo Miat), December 9, 1989, pp. 7-8.
5 Exhibit C, Original Record, pp. 184-186.
6 TSN (Romeo Miat), August 7, 1990, p. 9.
7 Id., pp. 11-12.
8 Downpayment in the amount of P1,050.00, Exhibit B, Original
Record, p. 182.
9 Id., p. 9.
10 Id., p. 6.
11 Id., pp. 13-14.
12 Id., p. 15.

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Castro vs. Miat

Alexander and his first wife left the house for personal
reasons. In April 1988, Alexander agreed to sell
13
to Romeo
his share in the Paco property for P42,750.00.
14
He received
a partial payment of P6,000.00 from Romeo. Nonetheless,
he never executed a deed of assignment in favor of Romeo,
as he had lots of work to do and had no time and x x x
there [wa]s nothing 15 to worry [as] the title [wa]s in
[Romeos] possession.
In February 1988, Romeo learned from his godmother in
his wedding, Mrs. Rosalina Castro, mother of petitioner
Virgilio Castro, that she had given Moises P30,000.00 as
downpayment for 16
the sale by Moises of the Paco property to
her son Virgilio.
On December 1, 1988, Romeo was brought by petitioner
Virgilio Castro to the chambers of Judge Anunciacion of the
Metropolitan Trial Court of Manila17
where the status of the
Paco property was discussed. On December 16, 1988, he
received a letter from petitioner Castros lawyer asking for
a conference. Romeo was informed that the Paco property
had been sold to Castro by Moises 18
by virtue of a deed of
sale dated December 19
5, 1988 for ninety-five thousand
(P95,000.00) pesos. 20
Ceferino Miat, brother of petitioner21 Moises, testified
that even before the death of Concordia there was already
an agreement that22
the Paco property would go to Romeo
and Alexander.
23
This was reiterated at the deathbed of
Concordia. When Moises24returned to Manila for good, the
agreement was reiterated in front

_______________

13 Id., p. 23.
14 Id., pp. 25-26.
15 Id., p. 27.
16 Id., p. 28.
17 TSN (Romeo Miat), August 7, 1990, p. 32 [also February 21, 1991, pp.
42-43].
18 Id., p. 33.
19 Original Record, p. 9 (Deed of Absolute Sale, Annex B, Complaint,
Civil Case No. 89-48082, RTC, Branch 10, Manila).
20 TSN (Ceferino Miat), January 25, 1990, p. 6.
21 TSN (Romeo Miat), December 9, 1989, p. 8.
22 TSN (Ceferino Miat), April 5, 1990, p. 8.
23 Id., p. 8.
24 TSN (Ceferino Miat), January 25, 1990, p. 11.

276

276 SUPREME COURT REPORTS ANNOTATED

 Castro vs. Miat

25
of the extended Miat26 family members. Initially, Romeo
and Alexander 27
orally divided the Paco property between
themselves.
28
Later, however, Alexander sold his share to
Romeo. Alexander was given P6,000.00 as downpayment.
This was corroborated by Pedro Miranda and Virgilio Miat.
Miranda worked29with Moises at the Bayview Hotel and the
Hotel Filipinas.
30
His wife is the cousin of Romeo and
Alexander. Virgilio is the brother of Moises.
Moises confirmed that he and his wife Concordia bought
the Paco property on installment from the Fraval Realty,
Inc. There was still a balance 31
of P12,000.00 on the lot at
32
the time of his wifes death.
33
He paid P3,500.00 in 1981
and P8,500.00 in 1984. He registered the title in his name.
Romeo then borrowed the 34
title as he was going to mortgage
it to his friend Lorenzo.
Later, Moises ran into financial difficulties and he
mortgaged for P30,000.00 the 35Paco property to the parents
of petitioner Virgilio Castro. He informed Romeo and
Alexander that he would be forced to sell the Paco property
if they would not redeem the mortgage. He accompanied
his children to the Manila City Hall to discuss its sale with
a judge and a lawyer. Also present in the meeting

_______________

25 Id., p. 12.
26 TSN (Ceferino Miat), April 5, 1990, p. 14.
27 TSN (Ceferino Miat), January 25, 1990, p. 12.
28 Id., p. 13.
29 TSN (Pedro Miranda), April 5, 1990, p. 21.
30 TSN (Pedro Miranda), April 5, 1990, p. 20.
31 TSN (Moises Miat), September 5, 1991, p. 7.
32 Id., p. 8.
33 Id., p. 9.
34 TSN (Moises Miat), May 2, 1991, p. 6. In the TSN (Moises Miat),
September 5, 1991, p. 16, Moises clarified the mortgage to be a
panghahawakan lang ni Lorenzo. A contrary testimony was given by
Alex [TSN (Alex Miat), August 4, 1992) pp. 40-41]: Romeo got the title
from their father to lend to Ramon Lorenzo who was using the title to
borrow money for himself (Ramon Lorenzo).
 35 TSN (Moises Miat), May 2, 1991, pp. 12-13. In the TSN (Moises
Miat), September 5, 1991, pp. 17-22, Moises clarified the mortgage to be
actually a promissory note for P30,000.00, with the condition that, if the
same would not be paid after one (1) year, he would sell the property to
Mr. & Mrs. Levi Castro for P85,000.00 (actually P95,000.00 as seen in said
promissory note, Exhibit K, Original Record, p. 262).

277

VOL. 397, FEBRUARY 11, 2003 277

Castro vs. Miat

were petitioner Virgilio Castro and his parents. After the

conference, he proceeded 36 to sell the property to the
petitioners-spouses Castro.
Alexander testified that after the sale, his father got
one-third (1/3) of the proceeds while he received two-thirds
(2/3). Romeo did not get a single centavo37
but was given the
right to till their Nueva Ecija property. From his share of
the proceeds, Alexander intended to return to Romeo the
P6,000.00 given him earlier by the latter. He considered
the money to be a personal debt due Romeo, not 38
Romeos
downpayment of his share in the Paco property.
The buyer of the property, petitioner Virgilio P. Castro,
testified that he informed Romeo that his father Moises
was selling
39
the Paco property. Romeo replied: Bahala
siya. The second time he informed Romeo about the
pending sale was when he brought Romeo, Alexander and
Moises to Judge Anunciacion to consult him 40
[as to] who
has [the] right over the [Paco] property. He further
declared that he went to the Metropolitan Trial Court
because [he]
41
wanted to be sure whether [he] could buy the
property. During the meeting, he was told by Romeo that
the Paco property was already given to him (Romeo) by
Moises. He admitted knowing that the title 42
to the Paco
property was in the possession of Romeo. However, he
proceeded with the sale. Moises assured
43
him that he would
be able to get the title from Romeo.
These events precipitated the case at bar. Romeo filed
an action to nullify the sale between Moises and the Castro
spouses; to compel Moises and Alexander to execute a deed
of conveyance or assignment of the Paco property to him
upon payment of the balance
44
of its agreed price; and to
make them pay damages.

_______________

36 TSN (Moises Miat), May 2, 1991, pp. 14-15.

37 TSN (Alex Miat), August 4, 1992, p. 12.
38 Id., pp. 21-26.
39 TSN (Virgilio Castro), August 4, 1992, pp. 50-51.
40 Id., p. 57.
41 Id., p. 60.
42 Id., p. 54.
43 Id., p. 61.
44 Original Record, pp. 1-9 (Complaint, Civil Case No. 89-48082, RTC,
Branch 10, Manila).

278

278 SUPREME COURT REPORTS ANNOTATED

Castro vs. Miat

45
After trial, the Regional Trial Court rendered its decision,
which in its dispositive portion states as follows:

WHEREFORE, in view of the foregoing, the Court hereby orders

the following: 1) Defendant Alexander V. Miat to execute a deed of
sale of his share in the property upon payment by plaintiff Romeo
of the balance of the purchase price in the sum of P36,750.00; 2)
Plaintiff Romeo V. Miat to recognize as valid the sale of defendant
Moises share in the house and lot located at No. 1495-C Fabie
Estate, Paco, Manila; 3) the dismissal of defendants counter-
claim; and 4) defendants to pay the costs of suit.

Both parties appealed to Court of Appeals. On November

29, 1999,46
the appellate Court modified the Decision as
follows:

WHEREFORE, the appealed decision is MODIFIED as follows:

(1) The deed of sale entered into between defendants-

appellants Moises Miat and spouses Virgilio and Michelle
Castro is hereby NULLIFIED.
(2) Defendant-appellants Moises Miat and Alexander Miat
are ordered to execute a deed of conveyance over the Paco
 property with TCT No. 16383 (sic) in favor of plaintiff-
appellant Romeo Miat, upon payment by Romeo Miat of
the balance of the purchase price in the sum of
P36,750.00.
(3) Defendants-appellants are ordered, jointly and severally,
to pay plaintiff-appellant attorneys fees in the amount of
P30,000.00 and to pay the costs of suit.

Reconsideration was denied on May 17, 2000.

Hence, this petition where the petitioners assign the

following errors:

THE RESPONDENT COURT OF APPEALS GRAVELY ERRED

AND DID PETITIONERS AN INJUSTICE IN MODIFYING OR
REVERSING THE DECISION OF THE TRIAL COURT DATED
MARCH 17, 1993 WHICH ORDERED RESPONDENT ROMEO
MIAT TO RECOGNIZE AS VALID THE DEED OF SALE
ENTERED INTO BETWEEN PETITIONERS MOISES MIAT
AND SPS. VLRGILIO AND MICHELLE CASTRO PERTAINING
TO PETITIONER MOISES MIATS SHARE IN THE HOUSE
AND LOT LOCATED IN PACO, MANILA, WHEN IT
DECLARED SAID DEED OF SALE NULLIFIED.

_______________

45 Original Record, pp. 311-314.

46 Rollo, pp. 25-43.

279

VOL. 397, FEBRUARY 11, 2003 279

Castro vs. Miat

THE RESPONDENT COURT OF APPEALS PATENTLY ERRED

IN AFFIRMING OR UPHOLDING THE TRIAL COURTS
DECISION ORDERING ALEXANDER MIAT AND INCLUDING
MOISES MIAT TO EXECUTE A DEED OF CONVEYANCE
OVER THE PACO PROPERTY WITH TCT NO. 16383 IN FAVOR
OF ROMEO MIAT UPON PAYMENT BY THE LATTER OF THE
BALANCE OF THE PURCHASE PRICE IN THE SUM OF
P36,750.00.
 THE RESPONDENT COURT OF APPEALS GRAVELY
ERRED IN FURTHER ORDERING PETITIONERS TO PAY
RESPONDENT, JOINTLY AND SEVERALLY, ATTORNEYS
FEES IN THE AMOUNT OF P30,000.00 AND AFFIRMING THE
COURT A QUOS ORDER
47
FOR THE PETITIONERS TO PAY
THE COST OF SUIT.

The issues can be simplified thus:

1. Whether the Paco property is conjugal or capital;

2. Whether there was a valid oral partition covering
the said property; and
3. Whether the spouses Castro were buyers in good
faith.

The petitioners contend that the Paco property is the

capital property of Moises. They allege that the spouses
Moises and Concordia purchased the property on
installment basis in 1977 but stress that it was Moises who
paid the balance of twelve thousand (P12,000.00) pesos in
1984. At that time, Concordia had long been dead. She died
in 1978.
We disagree.
Since Moises and Concordia were married before the
effectivity of the Family Code, the provisions of the New
Civil Code apply. 48
Article 153(1) of the New Civil Code provides as
follows:

The following are conjugal partnership property:

(1) Those acquired by onerous title during the marriage at the

expense of the common fund, whether the acquisition be
for the partnership, or for only one of the spouses; x x x.

_______________

47 Id., p. 17.
48 Now Article 117(1) of the Family Code.

280
280 SUPREME COURT REPORTS ANNOTATED
Castro vs. Miat

The records show that the Paco property was acquired by

onerous title during the marriage out of the common fund.
It is clearly conjugal property.
Petitioners also overlook Article 160 of the New Civil
Code. It provides that all property of the marriage is
presumed to belong to the conjugal partnership, unless it
be proved that it pertains exclusively to the husband or to
the wife. This article does not require proof that the
property was acquired with funds of the partnership. The
presumption applies even when the manner49
in which the
property was acquired does not appear. 50
Petitioners reliance on Lorenzo vs. Nicolas is
misplaced. That case involved two (2) parcels of land that
Magdalena Clemente purchased on installment and started
paying for when she was not yet married to Manuel
Lorenzo. When she married Manuel Lorenzo she continued
to pay the installments in her own name. Upon completion
of payment, the deed of final conveyance was executed in
her sole favor and the land was registered in the exclusive
name of Magdalena Clemente. The Court ruled that the
two (2) parcels of land were the paraphernal properties of
Magdalena Clemente, thus:

x x x the fact that all receipts for installments paid even during
the lifetime of the late husband Manuel Lorenzo were issued in
the name of Magdalena Clemente and that the deed of sale or
conveyance of parcel no. 6 was made in her name in spite of the
fact that Manuel Lorenzo was still alive shows that 51
the two
parcels of land belonged to Magdalena Clemente. (emphasis
supplied)

In the case at bar, Moises and Concordia bought the Paco

property during their marriageMoises did not bring it
into their marriage, hence it has to be considered as
conjugal. 52
Likewise, Jovellanos vs. Court of Appeals cited by the
petitioners is inapropos. In said case, Daniel Jovellanos,
while he was still married to his first wife, Leonor Dizon,
entered into a contract of lease and conditional sale with
Philamlife. He continued paying the rental after the death
of his first wife and during the subsis-

_______________

49 Tan vs. Court of Appeals, 273 SCRA 229 (1997).

50 91 Phil. 686 (1952).
51 Lorenzo vs. Nicolas, 91 Phil. 686, 692-693 (1952).
52 210 SCRA 126 (1992).

281

VOL. 397, FEBRUARY 11, 2003 281

Castro vs. Miat

tence of his marriage with his second wife, Anette

Jovellanos. He completed the payment during the existence
of his second marriage. The Court ruled that the property
belonged to the conjugal partnership with the second wife
as Daniel Jovellanos acquired ownership thereof only upon
full payment of the said amount hence, although he had
been in possession of the premises since September 2, 1955,
it was only on January 8, 1975 that the Philamlife executed
the deed of absolute sale thereof in his favor. x x x Since as
early as 1967, he was already married to Annette H.
Jovellanos, this property necessarily belonged53
to his
conjugal partnership with his second wife. In the case at
bar, Moises and Concordia executed a Deed of Sale with
Mortgage. The contract is one of salethe 54
title passed to
them upon delivery of the Paco prop-erty. In fine, title was
gained during the conjugal partnership.

II

The next issue is whether the oral partition between

Moises and his sons, Romeo and Alexander, involving the
said property is valid. In ruling in favor of its validity
which we affirm, the appellate court relied on 55a portion of
Moises letter to Romeo, which reads as follows:

KAYA PAG-USAPAN LANG NINYONG MABUTI ANG ANONG

BALAK AT GUSTO NINYONG PAGHATI SA BAHAY, AT YAN
AY PAGPAPASIYAHAN KO KONG (sic) MAKAKABUTI SA
INYONG DALAWA. AT WALA AKONG HIGIT NA PAPABURAN
SA INYONG DALAWA PAREHO KAYONG MAHAL SA AKIN,
HINDI AKO TULAD SA IBANG MAGULANG NA HINDI 56
PAREHO ANG PAGTINGIN SA MGA ANAK. ANG BAHAY AY
PARA SA INYONG DALAWA, LALO NA NGAYONG MAY
ASAWA NA KAYONG PAREHO. x x x [All caps in the original]

Ceferino Miat, brother of Moises, testified that before

Concordia died, there was an agreement that the
Paraaque property would go to Moises while the Paco
property would go to Romeo and Alex-

_______________

53 Id., pp. 133-135.

54 Salazar vs. Court of Appeals, 258 SCRA 317 (1996).
55 Original Record, p. 260, lines 19-24 of Exhibit J-1, letter dated July
31, 1983.
56 In Exhibit D, infra, the second (2nd) kasunduan speaks of lupa at
bahay (70 sq. m.) going to Romeo and Alexander.

282

282 SUPREME COURT REPORTS ANNOTATED

Castro vs. Miat

ander. This was reiterated at the deathbed of Concordia.

When Moises returned to Manila for good, the agreement
was affirmed in front of the extended Miat family
members. Initially, Romeo and Alexander orally divided
the Paco property between them. Later, Alexander sold his
share to Romeo.
This agreement was attested to by the extended Miat
Family members in a 57document marked as Exhibit D,
which reads as follows:

Pebrero 18, 1989

SINUMPAANG SALAYSAY

SA MGA KINAUUKULAN,

Kami, na nakalagda sa ibaba, ay nanunumpa sa harapan ng

Punong Barangay, na si G. REYNALDO P. WONG:
 Na kami ay mga saksi sa kasunduan nina G. MOISES B.
MIAT, asawa ng yumao na, na si Gng. CONCORDIA
VALENZUELA MIAT, at mga anak nitong sina G. ROMEO V.
MIAT at G. ALEXANDER V. MIAT:
Na ang kasunduan ay ang mga sumusunod:

1) Na ang pag-aaring lupa (132 sq. m.) ng mag-asawa

(MOISES at CONCORDIA) sa Airport Village sa
Paraaque, Metro Manila ay mapupunta kay G. MOISES
B. MIAT;
2) Na ang pag-aaring lupa at bahay (70 sq. m.) ng mag-
asawa ring nabanggit ay sa magkapatid na ROMEO at
ALEXANDER mapupunta at ito ay nasa address na 1495-
C FABIE, PACO, MANILA.
58
MGA SUMUMPA:
(Sgd.) (Sgd.)
1) Ceferino B. Miat 6) Lorenzo C. Valenzuela
(kapatid ni Moises) (kapatid ni Concordia)
(Sgd.) (Sgd.)
2) Avelina J. Miat 7) Patricio C. Valenzuela
(asawa ni Ceferino) (kapatid ni Concordia)
(Sgd.) (Sgd.)
3) Virgilio Miat 8) Victor C. Valenzuela
(kapatid ni Moises) (kapatid ni Concordia)

_______________

57 TSN (Romeo Miat), August 7, 1990 [Original Record, p. 187].

58 Other descriptive information, e.g., addresses, voters ID No., etc., omitted for
brevity.

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VOL. 397, FEBRUARY 11, 2003 283

Castro vs. Miat

(Sgd.) (Sgd.)
4) Aurea Miat-Joson 9) Elsa P. Miranda
(kapatid ni Moises)
(Sgd.)
5) Jose A. Joson
(asawa ni Aurea)
(Sgd.) REYNALDO P. WONG
Kapitan ng Barangay
Sta. Maria, Licab, N.E. (emphasis supplied)

The consideration for the grant to Romeo and Alexander of

the Paco property was best expressed by Moises himself in
his letter to Romeo, which reads as follows:

Labis akong nagpapasalamat at nauunawaan ninyo ang mga

pagkakamali ko at mga kasalanan kong nagawa sa inyong mag-
iina, huwag kayong mag-alala at lahat nang naipundar namin
nang (sic) inyong
59
nanay ay sa inyong dalawang magkapatid
mapupunta.

We also hold that the oral partition between Romeo and

Alexander is not covered by the Statute of Frauds. It is
enforceable for two reasons. Firstly, Alexander accepted the
six thousand (P6,000.00) pesos given by Romeo as
downpayment for the purchase of his share in the Paco
property. Secondly, Romeo and his witnesses, Ceferino
Miat and Pedro Miranda, who testified regarding the sale
of Alexanders share to60 Romeo, were intensely questioned
by petitioners counsel.

_______________

59 TSN (Romeo Miat), February 21, 1991, p. 5 [Note: Read into the
record by Romeo Miat. The letter was not, however, marked as an
Exhibit.].
60 When the nature of the testimonies of Ceferino Miat [TSN, January
25, 1990, pp. 4-5] and Pedro Miranda [TSN, April 5, 1990, p. 18] was
offered, i.e., that they were privy to the oral partion of the Paco property
between Moises Miat and his two sons and, subsequently, between Romeo
and Alexander, no objection was offered by opposing counsel. [Art. 1405
(New Civil Code). Contracts infringing the Statute of Frauds, referred to
in No. 2 of Article 1403, are ratified by the failure to object to the
presentation of oral evidence to prove the same, or by the acceptance of
benefits under them.]

284
284 SUPREME COURT REPORTS ANNOTATED
Castro vs. Miat

In the
61
recent case of Pada-Kilario vs. Court of Appeals, we
held:

[N]o law requires partition among heirs to be in writing and be

registered in order to be valid. The requirement in Sec. 1, Rule 74
of the Revised Rules of Court that a partition be put in a public
document and registered, has for its purpose the protection of
creditors and the heirs themselves against tardy claims. The
object of registration is to serve as constructive notice to others. It
follows then that the intrinsic validity of partition not executed
with the prescribed formalities is not undermined when no
creditors are involved. Without creditors to take into
consideration, it is competent for the heirs of an estate to enter
into an agreement for distribution thereof in a manner and upon a
plan different from those provided by the rules from which, in the
first place, nothing can be inferred that a writing or other
formality is essential for the partition to be valid. The partition of
inherited property need not be embodied in a public document so
as to be effective as regards the heirs that participated therein.
The requirement of Article 1358 of the Civil Code that acts which
have for their object the creation, transmission, modification or
extinguishment of real rights over immovable property, must
appear in a public instrument, is only for convenience, non-
compliance with which does not affect the validity or
enforceability of the acts of the parties as among themselves. And
neither does the Statute of Frauds under Article 1403 of the New
Civil Code apply because partition among heirs is not legally
deemed a conveyance of real property, considering that it involves
not a transfer of property from one to the other but rather, a
confirmation or ratification of title or right of property that an
heir is renouncing in favor of another heir who accepts and
receives the inheritance. x x x.

III

The appellate court also correctly held that the

petitionersspouses Castro were not buyers in good faith. A
purchaser in good faith is one who buys property and pays
a full and fair price for it at the time of the purchase or
before any notice of some other persons claim on or
interest in it. The rule is settled that a buyer of real
property, which is in the possession of persons other than
the seller, must be wary and should investigate the rights
of those in possession. Otherwise, without such inquiry,
62
the
buyer can hardly be regarded as buyer in good faith.

_______________

61 322 SCRA 481, 490-491 (2000).

62 Republic vs. De Guzman, 326 SCRA 267 (2000).

285

VOL. 397, FEBRUARY 11, 2003 285

Castro vs. Miat

This finding of the appellate court that the Castro spouses

were not buyers in good faith is supported by evidence.
Petitioner Virgilio Castro admitted in his testimony that
Romeo told him that Moises had given the Paco property to
them. In fact, they consulted Judge Anunciacion on who
had the right to the propertyMoises or Romeo. As well
pointed out by the appellate court:

In the case at bench, the said spouses have actual knowledge of

the adverse claim of plaintiff-appellant. The most protuberant
index that they are not buyers in good faith is that before the sale,
Virgilio Castro talked with Romeo Miat on the supposed sale.
Virgilio testified that together with Romeo, Alexander and Moses
Miat, they went to Judge Anunciacion of Manila in order to find
out if Romeo has a right over the property. Romeo told Virgilio in
that meeting that Romeo has a right over the Paco property by
virtue of an oral partition and assignment. Virgilio even admitted
that he knew Romeo was in possession of the title and Romeo
then insisted that he is the owner of the property.
x x xx x xx x x
Virgilio Castro is further aware that plaintiff is in possession
of the property, they being neighbors. A purchaser who was fully
aware of another persons possession of the lot he purchased
cannot 63 successfully pretend to be an innocent purchaser for
value.
It is abundantly clear that the petitioners-spouses Castro
did not buy the Paco property in good faith. They have no
right to the property.
WHEREFORE, the decision of the appellate court in CA-
G.R. CV No. 43053 is affirmed. Costs against petitioners.
SO ORDERED.

Panganiban, Sandoval-Gutierrez, Corona and

Carpio-Morales, JJ., concur.

Judgment affirmed.

Notes.The provisions of the Family Code cannot be

retroactively applied where to do so would prejudice the
vested rights of a party and of her children. (Ty vs. Court of
Appeals, 346 SCRA 86 [2000])

_______________

63 Rollo, pp. 39-40 [Decision, CA-G.R. CV No. 43053, November 29,

1999, pp. 15-16].

286

286 SUPREME COURT REPORTS ANNOTATED

Bacelonia vs. Court of Appeals

The situation contemplated under Article 214 of the Family

Code to be governed by summary judicial proceedings is
one where the spouse is absent, or separated in fact or has
abandoned the other or consent is withheld or cannot be
obtainedsuch rules do not apply to cases where the non-
consenting spouse is incapacitated or incompetent to give
consent, in which case the proper remedy is judicial
guardianship proceedings under Rule 93 of the 1964
Revised Rules of Court. (Uy vs. Court of Appeals, 346 SCRA
246 [2000])

o0o
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