TORBELA VS ROSARIO

G.R. No. 140528 / 140553; 7 December 2011

NATURE:
Two consolidated Petitions for Review on Certiorari assailing the Decision and Resolution of the Court of
Appeals
PONENTE:
Leonarda De Castro, J.
FACTS:
The issue is over a parcel of land inherited by the Torbela siblings from their parents. They executed a
deed of absolute quitclaim over the property in favor of Dr. Rosario. Four days after, a TCT was issued in Dr.
Rosarios name covering the property. Another deed of absolute quitclaim was subsequently executed twelve
days after by Dr. Rosario acknowledging that he only borrowed the lot from the Torbela siblings and was already
returning the same. This deed was notarized but not immediately annotated. Dr. Rosario used the land as
mortgage for a loan he obtain through DBP for P70,000.00. He used the proceeds of the loan to build a 4 storey
building which was initially used as a hospital but later converted into a commercial space. Part was leased to
PT&T and the rest to Rosario s sister who operated the Rose Inn Hotel and Restaurant .Dr. Rosario fully paid the loan from
DBP and the mortgage was cancelled and ratified by a notary public. However, Dr. Rosario took another loan from PNB. He
later acquired a third loan from Banco Filipino and bought out the loan from PNB cancelling the mortgage with PNB. Rosario
failed to pay their loan in Banco Filipino and the property was extrajudicially foreclosed. Meanwhile, back
in 1965, the Torbela siblings sought to register their ownership over the lot and to perfect their title
but couldnt because the title was still with DBP. They showed as proof the deed of absolute quitclaim
presented executed by Rosario himself. In 1986, they filed a civil case for recoveryof ownership and
possession and damages. They tried to redeem the lot from Banco Filipino butfailed. TCT was issued
to Banco Filipino. The Torbelas claim they haveright over the rents of the building through accession
because they are the land owners.
ISSUE:
Whether or not there was an express trust between the Torbela siblings and Dr. Rosario
HELD:
Yes.
RATIO DECIDENDI:
There is no dispute that the Torbela sibling inherited the title to Lot No. 356-A from their parents, the
Torbela spouses, who, in turn, acquired the same from the first registered owner of Lot No. 356-A,
Valeriano.
Among the notable evidence presented by the Torbela siblings is the testimony of Atty. Lorenza Alcantara
(Atty. Alcantara), who had no apparent personal interest in the present case. Atty. Alcantara, when she
was still a boarder at the house of Eufrosina Torbela Rosario, was consulted by the Torbela siblings as

regards the extrajudicial partition of Lot No. 356-A. She also witnessed the execution of the two Deeds
of Absolute Quitclaim by the Torbela siblings and Dr. Rosario.
In contrast, Dr. Rosario presented TCT No. 52751, issued in his name, to prove his purported title to Lot
No. 356-A. In Lee Tek Sheng v. Court of Appeals, [ the Court made a clear distinction between title and
the certificate of title:
The certificate referred to is that document issued by the Register of Deeds known as the
Transfer Certificate of Title (TCT). By title, the law refers to ownership which is
represented by that document. Petitioner apparently confuses certificate with
title. Placing a parcel of land under the mantle of the Torrens system does not mean that
ownership thereof can no longer be disputed. Ownership is different from a certificate of
title. The TCT is only the best proof of ownership of a piece of land. Besides, the
certificate cannot always be considered as conclusive evidence of ownership. Mere
issuance of the certificate of title in the name of any person does not foreclose the
possibility that the real property may be under co-ownership with persons not
named in the certificate or that the registrant may only be a trustee or that other
parties may have acquired interest subsequent to the issuance of the certificate of
title. To repeat, registration is not the equivalent of title, but is only the best evidence
thereof. Title as a concept of ownership should not be confused with the certificate
of title as evidence of such ownership although both are interchangeably used. x x x.
(Emphases supplied.)
Registration does not vest title; it is merely the evidence of such title. Land registration laws do not give
the holder any better title than what he actually has. Consequently, Dr. Rosario must still prove herein his
acquisition of title to Lot No. 356-A, apart from his submission of TCT No. 52751 in his name.
Dr. Rosario may not modify, explain, or add to the terms in the two written Deeds of Absolute Quitclaim
since he did not put in issue in his pleadings (1) an intrinsic ambiguity, mistake, or imperfection in the
Deeds; (2) failure of the Deeds to express the true intent and the agreement of the parties thereto; (3) the
validity of the Deeds; or (4) the existence of other terms agreed to by the Torbela siblings and Dr. Rosario
after the execution of the Deeds. Since Dr. Rosarios Deed of Absolute Quitclaim dated December 28,
1964 is a declaration against his self-interest, it must be taken as favoring the truthfulness of the contents
of said Deed.
It can also be said that Dr. Rosario is estopped from claiming or asserting ownership over Lot No. 356-A
based on his Deed of Absolute Quitclaim dated December 28, 1964. Dr. Rosario's admission in the said
Deed that he merely borrowed Lot No. 356-A is deemed conclusive upon him. Under Article 1431 of the
Civil Code, [t]hrough estoppel an admission or representation is rendered conclusive upon the person
making it, and cannot be denied or disproved as against the person relying thereon. That admission
cannot now be denied by Dr. Rosario as against the Torbela siblings, the latter having relied upon his
representation.
Trust is the right to the beneficial enjoyment of property, the legal title to which is vested in another. It is
a fiduciary relationship that obliges the trustee to deal with the property for the benefit of the
beneficiary. Trust relations between parties may either be express or implied. An express trust is created
by the intention of the trustor or of the parties, while an implied trust comes into being by operation of
law.
Express trusts are created by direct and positive acts of the parties, by some writing or deed, or will, or by
words either expressly or impliedly evincing an intention to create a trust. Under Article 1444 of the Civil
Code, [n]o particular words are required for the creation of an express trust, it being sufficient that a trust

is clearly intended. It is possible to create a trust without using the word trust or trustee. Conversely,
the mere fact that these words are used does not necessarily indicate an intention to create a trust. The
question in each case is whether the trustor manifested an intention to create the kind of relationship
which to lawyers is known as trust. It is immaterial whether or not he knows that the relationship which
he intends to create is called a trust, and whether or not he knows the precise characteristics of the
relationship which is called a trust.
In Tamayo v. Callejo, the Court recognized that a trust may have a constructive or implied nature in the
beginning, but the registered owners subsequent express acknowledgement in a public document of a
previous sale of the property to another party, had the effect of imparting to the aforementioned trust the
nature of an express trust. The same situation exists in this case. When Dr. Rosario was able to register
Lot No. 356-A in his name under TCT No. 52751 on December 16, 1964, an implied trust was initially
established between him and the Torbela siblings under Article 1451 of the Civil Code, which provides:
ART. 1451. When land passes by succession to any person and he causes the
legal title to be put in the name of another, a trust is established by implication of law for
the benefit of the true owner.
Dr. Rosarios execution of the Deed of Absolute Quitclaim on December 28, 1964, containing his express
admission that he only borrowed Lot No. 356-A from the Torbela siblings, eventually transformed the
nature of the trust to an express one. The express trust continued despite Dr. Rosario stating in his Deed
of Absolute Quitclaim that he was already returning Lot No. 356-A to the Torbela siblings as Lot No. 356A remained registered in Dr. Rosarios name under TCT No. 52751 and Dr. Rosario kept possession of
said property, together with the improvements thereon.
DECISION:
Petition for review is GRANTED.
/mpv