SECOND DIVISION[G.R. No. 132305.December 4, 2001]IDA C. LABAGALA,petitioner, vs. NICOLASA T. SANTIAGO, AMANDA T. SANTIAGO and HON. COURT OF APPEALS,respondents.D E C I S I O NQUISUMBING, J.:This petition for review oncertiorariseeks to annul the decision dated March 4, 1997,[1]of the Court of Appeals in CA-G.R. CV No. 32817, which reversed and set aside the judgment dated October 17, 1990,[2]of the Regional Trial Court of Manila, Branch 54, in Civil Case No. 87-41515, finding herein petitioner to be the owner of 1/3pro indivisoshare in a parcel of land.The pertinent facts of the case, as borne by the records, are as follows:Jose T. Santiago owned a parcel of land covered by TCT No. 64729, located in Rizal Avenue Extension, Sta. Cruz, Manila.Alleging that Jose had fraudulently registered it in his name alone, his sisters Nicolasa and Amanda (now respondents herein), sued Jose for recovery of 2/3 share of the property.[3]On April 20, 1981, the trial court in that case decided in favor of the sisters, recognizing their right of ownership over portions of the property covered by TCT No. 64729.The Register of Deeds of Manila was required to include the names of Nicolasa and Amanda in the certificate of title to said property.[4]Jose died intestate on February 6, 1984.On August 5, 1987, respondents filed a complaint for recovery of title, ownership, and possession against herein petitioner, Ida C. Labagala, before the Regional Trial Court of Manila, to recover from her the 1/3 portion of said property pertaining to Jose but which came into petitioners sole possession upon Joses death.Respondents alleged that Joses share in the property belongs to them by operation of law, because they are the only legal heirs of their brother, who died intestate and without issue.They claimed that the purported sale of the property made by their brother to petitioner sometime in March 1979[5]was executed through petitioners machinations and with malicious intent, to enable her to secure the corresponding transfer certificate of title (TCT No. 172334[6]) in petitioners name alone.[7]Respondents insisted that the deed of sale was a forgery.The deed showed that Jose affixed his thumbmark thereon but respondents averred that, having been able to graduate from college, Jose never put his thumbmark on documents he executed but always signed his name in full.They claimed that Jose could not have sold the property belonging to his poor and unschooled sisters who sacrificed for his studies and personal welfare.[8]Respondents also pointed out that it is highly improbable for petitioner to have paid the supposed consideration ofP150,000 for the sale of the subject property because petitioner was unemployed and without any visible means of livelihood at the time of the alleged sale.They also stressed that it was quite unusual and questionable that petitioner registered the deed of sale only on January 26, 1987, or almost eight years after the execution of the sale.[9]On the other hand, petitioner claimed that her true name is not Ida C. Labagala as claimed by respondent but Ida C. Santiago.She claimed not to know any person by the name of Ida C. Labagala.She claimed to be the daughter of Jose and thus entitled to his share in the subject property.She maintained that she had always stayed on the property, ever since she was a child.She argued that the purported sale of the property was in fact a donation to her, and that nothing could have precluded Jose from putting his thumbmark on the deed of sale instead of his signature.She pointed out that during his lifetime, Jose never acknowledged respondents claim over the property such that respondents had to sue to claim portions thereof.She lamented that respondents had to disclaim her in their desire to obtain ownership of the whole property.Petitioner revealed that respondents had in 1985 filed two ejectment cases against her and other occupants of the property.The first was decided in her and the other defendants favor, while the second was dismissed.Yet respondents persisted and resorted to the present action.Petitioner recognized respondents ownership of 2/3 of the property as decreed by the RTC.But she averred that she caused the issuance of a title in her name alone, allegedly after respondents refused to take steps that would prevent the property from being sold by public auction for their failure to pay realty taxes thereon.She added that with a title issued in her name she could avail of a realty tax amnesty.On October 17, 1990, the trial court ruled in favor of petitioner, decreeing thus:WHEREFORE, judgment is hereby rendered recognizing the plaintiffs [herein respondents] as being entitled to the ownership and possession each of one-third (1/3)pro indivisoshare of the property originally covered by Transfer Certificate of Title No. 64729, in the name of Jose T. Santiago and presently covered by Transfer Certificate of Title No. 172334, in the name of herein defendant [herein petitioner] and which is located at No. 3075-A Rizal Avenue Extension, Sta. Cruz, Manila, as per complaint, and the adjudication to plaintiffs per decision in Civil Case No. 56226 of this Court, Branch VI, and the remaining one-third (1/3)pro indivisoshare adjudicated in said decision to defendant Jose T. Santiago in said case, is hereby adjudged and adjudicated to herein defendant as owner and entitled to possession of said share.The Court does not see fit to adjudge damages, attorneys fees and costs.Upon finality of this judgment, Transfer Certificate of Title No. 172334 is ordered cancelled and a new title issued in the names of the two (2) plaintiffs and the defendant as owners in equal shares, and the Register of Deeds of Manila is so directed to effect the same upon payment of the proper fees by the parties herein.SO ORDERED.[10]According to the trial court, while there was indeed no consideration for the deed of sale executed by Jose in favor of petitioner, said deed constitutes a valid donation.Even if it were not, petitioner would still be entitled to Joses 1/3 portion of the property as Joses daughter.The trial court ruled that the following evidence shows petitioner to be the daughter of Jose:(1) the decisions in the two ejectment cases filed by respondents which stated that petitioner is Joses daughter, and (2) Joses income tax return which listed petitioner as his daughter.It further said that respondents knew of petitioners existence and her being the daughter of Jose, per records of the earlier ejectment cases they filed against petitioner.According to the court, respondents were not candid with the court in refusing to recognize petitioner as Ida C. Santiago and insisting that she was Ida C. Labagala, thus affecting their credibility.Respondents appealed to the Court of Appeals, which reversed the decision of the trial court.WHEREFORE, the appealed decision is REVERSED and one is entered declaring the appellants Nicolasa and Amanda Santiago the co-owners in equal shares of the one-third (1/3) pro indiviso share of the late Jose Santiago in the land and building covered by TCT No. 172334.Accordingly, the Register of Deeds of Manila is directed to cancel said title and issue in its place a new one reflecting this decision.SO ORDERED.Apart from respondents testimonies, the appellate court noted that the birth certificate of Ida Labagala presented by respondents showed that Ida was born of different parents, not Jose and his wife.It also took into account the statement made by Jose in Civil Case No. 56226 that he did not have any child.Hence, the present petition wherein the following issues are raised for consideration:1. Whether or not petitioner has adduced preponderant evidence to prove that she is the daughter of the late Jose T. Santiago, and2. Whether or not respondents could still impugn the filiation of the petitioner as the daughter of the late Jose T. Santiago.Petitioner contends that the trial court was correct in ruling that she had adduced sufficient evidence to prove her filiation by Jose Santiago, making her his sole heir and thus entitled to inherit his 1/3 portion. She points out that respondents had, before the filing of the instant case, previously considered[11]her as the daughter of Jose who, during his lifetime, openly regarded her as his legitimate daughter.She asserts that her identification as Joses daughter in his ITR outweighs the strange answers he gave when he testified in Civil Case No. 56226.Petitioner asserts further that respondents cannot impugn her filiation collaterally, citing the case ofSayson v. Court of Appeals[12]in which we held that (t)he legitimacy of (a) child can be impugned only in a direct action brought for that purpose, by the proper parties and within the period limited by law.[13]Petitioner also cites Article 263 of the Civil Code in support of this contention.[14]For their part, respondents contend that petitioner is not the daughter of Jose, per her birth certificate that indicate her parents as Leo Labagala and Cornelia Cabrigas, instead of Jose Santiago and Esperanza Cabrigas.[15]They argue that the provisions of Article 263 of the Civil Code do not apply to the present case since this is not an action impugning a childs legitimacy but one for recovery of title, ownership, and possession of property.The issues for resolution in this case, to our mind, are (1) whether or not respondents may impugn petitioners filiation in this action for recovery of title and possession; and (2) whether or not petitioner is entitled to Joses 1/3 portion of the property he co-owned with respondents, through succession, sale, or donation.On the first issue, we find petitioners reliance on Article 263 of the Civil Code to be misplaced.Said article provides:Art. 263.The action to impugn the legitimacy of the child shall be brought within one year from the recording of the birth in the Civil Register, if the husband should be in the same place, or in a proper case, any of his heirs.If he or his heirs are absent, the period shall be eighteen months if they should reside in the Philippines; and two years if abroad.If the birth of the child has been concealed, the term shall be counted from the discovery of the fraud.This article should be read in conjunction with the other articles in the same chapter on paternity and filiation in the Civil Code.A careful reading of said chapter would reveal that it contemplates situations where a doubt exists that a child is indeed a mans child by his wife, and the husband (or, in proper cases, his heirs) denies the childs filiation.It does not refer to situations where a child is alleged not to be the child at all of a particular couple.[16]Article 263 refers to an action to impugn thelegitimacyof a child, to assert and prove that a person is not a mans child by his wife.However, the present case is not one impugning petitioners legitimacy. Respondents are asserting not merely that petitioner is not a legitimate child of Jose, but that she is not a child of Jose at all.[17]Moreover, the present action is one for recovery of title and possession, and thus outside the scope of Article 263 on prescriptive periods.Petitioners reliance onSaysonis likewise improper.The factual milieu present inSaysondoes not obtain in the instant case.What was being challenged by petitioners inSaysonwas (1) the validity of the adoption of Delia and Edmundo by the deceased Teodoro and Isabel Sayson, and (2) the legitimate status of Doribel Sayson.While asserting that Delia and Edmundo could not have been validly adopted since Doribel had already been born to the Sayson couple at the time, petitioners at the same time made the conflicting claim that Doribel was not the child of the couple.The Court ruled in that case that it was too late to question the decree of adoption that became final years before.Besides, such a challenge to the validity of the adoption cannot be made collaterally but in a direct proceeding.[18]In this case, respondents are not assailing petitioners legitimate status but are, instead, asserting that she is not at all their brothers child.The birth certificate presented by respondents support this allegation.We agree with the Court of Appeals that::The Certificate of Record of Birth (Exhibit H)[19]plainly states that Ida was the child of the spouses Leon Labagala and [Cornelia] Cabrigas.This document states that it was Leon Labagala who made the report to the Local Civil Registrar and therefore the supplier of the entries in said Certificate.Therefore, this certificate is proof of the filiation of Ida.Appellee however denies that Exhibit H is her Birth Certificate.She insists that she is not Ida Labagala but Ida Santiago.If Exhibit H is not her birth certificate, then where is hers?She did not present any though it would have been the easiest thing to do considering that according to her baptismal certificate she was born in Manila in 1969.This court rejects such denials and holds that Exhibit H is the certificate of the record of birth of appellee IdaAgainst such evidence, the appellee Ida could only present her testimony and a baptismal certificate (Exhibit 12) stating that appellees parents were Jose Santiago and Esperanza Cabrigas.But then, a decisional rule in evidence states that a baptismal certificate is not a proof of the parentage of the baptized person.This document can only prove the identity of the baptized, the date and place of her baptism, the identities of the baptismal sponsors and the priest who administered the sacrament -- nothing more.[20](Citations omitted.)At the pre-trial conducted on August 11, 1988, petitioners counsel admitted that petitioner did not have a birth certificate indicating that she is Ida Santiago, though she had been using this name all her life.[21]Petitioner opted not to present her birth certificate to prove her relationship with Jose and instead offered in evidence her baptismal certificate.[22]However, as we held inHeirs of Pedro Cabais v. Court of Appeals:a baptismal certificate is evidence only to prove the administration of the sacrament on the dates therein specified, but not the veracity of the declarations therein stated with respect to [a persons] kinsfolk.The same is conclusive only of the baptism administered, according to the rites of the Catholic Church, by the priest who baptized subject child, but it does not prove the veracity of the declarations and statements contained in the certificate concerning the relationship of the person baptized.[23]A baptismal certificate, a private document, is not conclusive proof of filiation.[24]More so are the entries made in an income tax return, which only shows that income tax has been paid and the amount thereof.[25]We note that the trial court had asked petitioner to secure a copy of her birth certificate but petitioner, without advancing any reason therefor, failed to do so.Neither did petitioner obtain a certification that no record of her birth could be found in the civil registry, if such were the case.We find petitioners silence concerning the absence of her birth certificate telling.It raises doubt as to the existence of a birth certificate that would show petitioner to be the daughter of Jose Santiago and Esperanza Cabrigas.Her failure to show her birth certificate would raise the presumption that if such evidence were presented, it would be adverse to her claim.Petitioners counsel argued that petitioner had been using Santiago all her life.However, use of a family name certainly does not establish pedigree.Further, we note that petitioner, who claims to be Ida Santiago, has the same birthdate as Ida Labagala.[26]The similarity is too uncanny to be a mere coincidence.During her testimony before the trial court, petitioner denied knowing Cornelia Cabrigas, who was listed as the mother in the birth certificate of Ida Labagala.In her petition before this Court, however, she stated that Cornelia is the sister of her mother, Esperanza.It appears that petitioner made conflicting statements that affect her credibility and could cast a long shadow of doubt on her claims of filiation.Thus, we are constrained to agree with the factual finding of the Court of Appeals that petitioner is in reality the child of Leon Labagala and Cornelia Cabrigas, and contrary to her averment, not of Jose Santiago and Esperanza Cabrigas.Not being a child of Jose, it follows that petitioner can not inherit from him through intestate succession.It now remains to be seen whether the property in dispute was validly transferred to petitioner through sale or donation.On the validity of the purported deed of sale, however, we agree with the Court of Appeals that:This deed is shot through and through with so many intrinsic defects that a reasonable mind is inevitably led to the conclusion that it is fake.The intrinsic defects are extractable from the following questions:a) If Jose Santiago intended to donate the properties in question to Ida, what was the big idea of hiding the nature of the contract in the faade of the sale? b) If the deed is a genuine document, how could it have happened that Jose Santiago who was of course fully aware that he owned only 1/3pro indivisoof the properties covered by his title sold or donated the whole properties to Ida? c) Why in heavens name did Jose Santiago, a college graduate, who always signed his name in documents requiring his signature (citation omitted) [affix] his thumbmark on this deed of sale? d) If Ida was [the] child of Jose Santiago, what was the sense of the latter donating his properties to her when she would inherit them anyway upon his death? e) Why did Jose Santiago affix his thumbmark to a deed which falsely stated that:he was single (for he was earlier married to Esperanza Cabrigas); Ida was of legal age (for [s]he was then just 15 years old); and the subject properties were free from liens and encumbrances (for Entry No. 27261, Notice of Adverse Claim and Entry No. 6388, Notice of Lis Pendens were already annotated in the title of said properties).If the deed was executed in 1979, how come it surfaced only in 1984 after the death of Jose Santiago and of all people, the one in possession was the baptismal sponsor of Ida?[27]Clearly, there is no valid sale in this case.Jose did not have the right to transfer ownership of the entire property to petitioner since 2/3 thereof belonged to his sisters.[28]Petitioner could not have given her consent to the contract, being a minor at the time.[29]Consent of the contracting parties is among the essential requisites of a contract,[30]including one of sale, absent which there can be no valid contract.Moreover, petitioner admittedly did not pay any centavo for the property,[31]which makes the sale void.Article 1471 of the Civil Code provides:Art. 1471.If the price is simulated, the sale is void, but the act may be shown to have been in reality a donation, or some other act or contract.Neither may the purported deed of sale be a valid deed of donation.Again, as explained by the Court of Appeals:Even assuming that the deed is genuine, it cannot be a valid donation.It lacks the acceptance of the donee required by Art. 725 of the Civil Code.Being a minor in 1979, the acceptance of the donation should have been made by her father, Leon Labagala or [her] mother Cornelia Cabrigas or her legal representative pursuant to Art. 741 of the same Code.No one of those mentioned in the law - in fact no one at all - accepted the donation for Ida.[32]In sum, we find no reversible error attributable to the assailed decision of the Court of Appeals, hence it must be upheld.WHEREFORE,the petition is DENIED,and the decision of the Court of Appeals in CA-G.R. CV No. 32817 is AFFIRMED.Costs against petitioner.SO ORDERED.Republic of the PhilippinesSUPREME COURTManilaFIRST DIVISIONG.R. No. L-57499 June 22, 1984MERCEDES CALIMLIM- CANULLAS,petitioner,vs.HON. WILLELMO FORTUN, Judge, Court of First instance of Pangasinan, Branch I, and CORAZON DAGUINES,respondents.Fernandez Law Offices for petitioner.Francisco Pulido for respondents.MELENCIO-HERRERA,J.:Petition for Review on certiorari assailing the Decision, dated October 6, 1980, and the Resolution on the Motion for Reconsideration, dated November 27, 1980, of the then Court of First Instance of Pangasinan, Branch I, in Civil Case No. 15620 entitled "Corazon DAGUINES vs. MERCEDES Calimlim-Canullas," upholding the sale of a parcel of land in favor of DAGUINES but not of the conjugal house thereon'The background facts may be summarized as follows: Petitioner MERCEDES Calimlim-Canullas and FERNANDO Canullas were married on December 19, 1962. They begot five children. They lived in a small house on the residential land in question with an area of approximately 891 square meters, located at Bacabac, Bugallon, Pangasinan. After FERNANDO's father died in 1965, FERNANDO inherited the land.In 1978, FERNANDO abandoned his family and was living with private respondent Corazon DAGUINES. During the pendency of this appeal, they were convicted of concubinage in a judgment rendered on October 27, 1981 by the then Court of First Instance of Pangasinan, Branch II, which judgment has become final.On April 15, 1980, FERNANDO sold the subject property with the house thereon to DAGUINES for the sum of P2,000.00. In the document of sale, FERNANDO described the house as "also inherited by me from my deceased parents."Unable to take possession of the lot and house, DAGUINES initiated a complaint on June 19, 1980 for quieting of title and damages against MERCEDES. The latter resisted and claimed that the house in dispute where she and her children were residing, including the coconut trees on the land, were built and planted with conjugal funds and through her industry; that the sale of the land together with the house and improvements to DAGUINES was null and void because they are conjugal properties and she had not given her consent to the sale,In its original judgment, respondent Court principally declared DAGUINES "as the lawful owner of the land in question as well as the one-half () of the house erected on said land." Upon reconsideration prayed for by MERCEDES, however, respondent Court resolved:WHEREFORE, the dispositive portion of the Decision of this Court, promulgated on October 6, 1980, is hereby amended to read as follows:(1) Declaring plaintiff as the true and lawful owner of the land in question and the 10 coconut trees;(2) Declaring as null and void the sale of the conjugal house to plaintiff on April 15, 1980 (Exhibit A) including the 3 coconut trees and other crops planted during the conjugal relation between Fernando Canullas (vendor) and his legitimate wife, herein defendant Mercedes Calimlim- Canullas;xxx xxx xxxThe issues posed for resolution are (1) whether or not the construction of a conjugal house on the exclusive property of the husbandipso factogave the land the character of conjugal property; and (2) whether or not the sale of the lot together with the house and improvements thereon was valid under the circumstances surrounding the transaction.The determination of the first issue revolves around the interpretation to be given to the second paragraph of Article 158 of the Civil Code, which reads:xxx xxx xxxBuildings constructed at the expense of the partnership during the marriage on land belonging to one of the spouses also pertain to the partnership, but the value of the land shall be reimbursed to the spouse who owns the same.We hold that pursuant to the foregoing provision both the land and the building belong to the conjugal partnership but the conjugal partnership is indebted to the husband for the value of the land. The spouse owning the lot becomes a creditor of the conjugal partnership for the value of the lot,1which value would be reimbursed at the liquidation of the conjugal partnership.2In his commentary on the corresponding provision in the Spanish Civil Code (Art. 1404), Manresa stated:El articulo cambia la doctrine; los edificios construidos durante el matrimonio en suelo propio de uno de los conjuges son gananciales, abonandose el valor del suelo al conj uge a quien pertenezca.It is true that in the case ofMaramba vs. Lozano,3relied upon by respondent Judge, it was held that the land belonging to one of the spouses, upon which the spouses have built a house, becomes conjugal property only when the conjugal partnership is liquidated and indemnity paid to the owner of the land. We believe that the better rule is that enunciated by Mr. Justice J.B.L. Reyes inPadilla vs. Paterno,3 SCRA 678, 691 (1961), where the following was explained:As to the above properties, their conversion from paraphernal to conjugal assets should be deemed to retroact to the time the conjugal buildings were first constructed thereon or at the very latest, to the time immediately before the death of Narciso A. Padilla that ended the conjugal partnership. They can not be considered to have become conjugal property only as of the time their values were paid to the estate of the widow Concepcion Paterno because by that time the conjugal partnership no longer existed and it could not acquire the ownership of said properties. The acquisition by the partnership of these properties was, under the 1943 decision, subject to the suspensive condition that their values would be reimbursed to the widow at the liquidation of the conjugal partnership; once paid, the effects of the fulfillment of the condition should be deemed to retroact to the date the obligation was constituted (Art. 1187, New Civil Code) ...The foregoing premises considered, it follows that FERNANDO could not have alienated the house and lot to DAGUINES since MERCEDES had not given her consent to said sale.4Anent the second issue, we find that the contract of sale was null and void for being contrary to morals and public policy. The sale was made by a husband in favor of a concubine after he had abandoned his family and left the conjugal home where his wife and children lived and from whence they derived their support. That sale was subversive of the stability of the family, a basic social institution which public policy cherishes and protects.5Article 1409 of the Civil Code statesinter aliathat: contracts whose cause, object, or purpose is contrary to law, morals, good customs, public order, or public policy arevoidand inexistent from the very beginning.Article 1352 also provides that: "Contracts without cause, or withunlawful cause, produce no effect whatsoever.The cause is unlawful if it is contrary to law, morals, good customs, public order, or public policy."Additionally, the law emphatically prohibits the spouses from selling property to each other subject to certain exceptions.6Similarly, donations between spouses during marriage are prohibited.7And this is so because if transfers or con conveyances between spouses were allowed during marriage, that would destroy the system of conjugal partnership, a basic policy in civil law. It was also designed to prevent the exercise of undue influence by one spouse over the other,8as well as to protect the institution of marriage, which is the cornerstone of family law. The prohibitions apply to a couple living as husband and wife without benefit of marriage, otherwise, "the condition of those who incurred guilt would turn out to be better than those in legal union." Those provisions are dictated by public interest and their criterion must be imposed upon the wig of the parties. That was the ruling inBuenaventura vs. Bautista,also penned by Justice JBL Reyes (CA) 50 O.G. 3679, and cited inMatabuena vs. Cervantes.9We quote hereunder the pertinent dissertation on this point:We reach a different conclusion. While Art. 133 of the Civil Code considers as void a donation between the spouses during the marriage, policy considerations of the most exigent character as wen as the dictates ofmoralityrequire that thesame prohibition should apply to a common-law relationship.As announced in the outset of this opinion, a 1954 Court of Appeals decision, Buenaventura vs. Bautista, 50 OG 3679, interpreting a similar provision of the old Civil Code speaks unequivocally. If the policy of the law is, in the language of the opinion of the then Justice J.B.L. Reyes of that Court, 'to prohibit donations in favor of the other consort and his descendants because of fear of undue influence andimproper pressureupon the donor, a prejudice deeply rooted in our ancient law, ..., thenthere is every reason to apply the same prohibitive policy to persons living together as husband and wife without benefit of nuptials. For it is not to be doubted that assent to such irregular connection for thirty years bespeaks greater influence of one party over the other, so that the danger that the law seeks to avoid is correspondingly increased'. Moreover, as pointed out by Ulpian (in his lib 32 ad Sabinum, fr. 1), "It would not be just that such donations should subsist, lest the conditions of those who incurred guilt should turn out to be better." So long as marriage remains the cornerstone of our family law, reason and morality alike demand that the disabilities attached to marriage should likewise attach toconcubinage(Emphasis supplied),WHEREFORE, the Decision of respondent Judge, dated October 6, 1980, and his Resolution of November 27, 1980 on petitioner's Motion for Reconsideration, are hereby set aside and the sale of the lot, house and improvements in question, is hereby declared null and void. No costs.SO ORDERED.Republic of the PhilippinesSUPREME COURTManilaEN BANCA.M. No. 133-J May 31, 1982BERNARDITA R. MACARIOLA,complainant,vs.HONORABLE ELIAS B. ASUNCION, Judge of the Court of First Instance of Leyte,respondent.MAKASIAR,J:In a verified complaint dated August 6, 1968 Bernardita R. Macariola charged respondent Judge Elias B. Asuncion of the Court of First Instance of Leyte, now Associate Justice of the Court of Appeals, with "acts unbecoming a judge."The factual setting of the case is stated in the report dated May 27, 1971 of then Associate Justice Cecilia Muoz Palma of the Court of Appeals now retired Associate Justice of the Supreme Court, to whom this case was referred on October 28, 1968 for investigation, thus:Civil Case No. 3010 of the Court of First Instance of Leyte was a complaint for partition filed by Sinforosa R. Bales, Luz R. Bakunawa, Anacorita Reyes, Ruperto Reyes, Adela Reyes, and Priscilla Reyes, plaintiffs, against Bernardita R. Macariola, defendant, concerning the properties left by the deceased Francisco Reyes, the common father of the plaintiff and defendant.In her defenses to the complaint for partition, Mrs. Macariola alleged among other things that; a) plaintiff Sinforosa R. Bales was not a daughter of the deceased Francisco Reyes; b) the only legal heirs of the deceased were defendant Macariola, she being the only offspring of the first marriage of Francisco Reyes with Felisa Espiras, and the remaining plaintiffs who were the children of the deceased by his second marriage with Irene Ondez; c) the properties left by the deceased were all the conjugal properties of the latter and his first wife, Felisa Espiras, and no properties were acquired by the deceased during his second marriage; d) if there was any partition to be made, those conjugal properties should first be partitioned into two parts, and one part is to be adjudicated solely to defendant it being the share of the latter's deceased mother, Felisa Espiras, and the other half which is the share of the deceased Francisco Reyes was to be divided equally among his children by his two marriages.On June 8, 1963, a decision was rendered by respondent Judge Asuncion in Civil Case 3010, the dispositive portion of which reads:IN VIEW OF THE FOREGOING CONSIDERATIONS, the Court, upon a preponderance of evidence, finds and so holds, and hereby renders judgment (1) Declaring the plaintiffs Luz R. Bakunawa, Anacorita Reyes, Ruperto Reyes, Adela Reyes and Priscilla Reyes as the only children legitimated by the subsequent marriage of Francisco Reyes Diaz to Irene Ondez; (2) Declaring the plaintiff Sinforosa R. Bales to have been an illegitimate child of Francisco Reyes Diaz; (3) Declaring Lots Nos. 4474, 4475, 4892, 5265, 4803, 4581, 4506 and 1/4 of Lot 1145 as belonging to the conjugal partnership of the spouses Francisco Reyes Diaz and Felisa Espiras; (4) Declaring Lot No. 2304 and 1/4 of Lot No. 3416 as belonging to the spouses Francisco Reyes Diaz and Irene Ondez in common partnership; (5) Declaring that 1/2 of Lot No. 1184 as belonging exclusively to the deceased Francisco Reyes Diaz; (6) Declaring the defendant Bernardita R. Macariola, being the only legal and forced heir of her mother Felisa Espiras, as the exclusive owner of one-half of each of Lots Nos. 4474, 4475, 4892, 5265, 4803, 4581, 4506; and the remaining one-half (1/2) of each of said Lots Nos. 4474, 4475, 4892, 5265, 4803, 4581, 4506 and one-half (1/2) of one-fourth (1/4) of Lot No. 1154 as belonging to the estate of Francisco Reyes Diaz; (7) Declaring Irene Ondez to be the exclusive owner of one-half (1/2) of Lot No. 2304 and one-half (1/2) of one-fourth (1/4) of Lot No. 3416; the remaining one-half (1/2) of Lot 2304 and the remaining one-half (1/2) of one-fourth (1/4) of Lot No. 3416 as belonging to the estate of Francisco Reyes Diaz; (8) Directing the division or partition of the estate of Francisco Reyes Diaz in such a manner as to give or grant to Irene Ondez, as surviving widow of Francisco Reyes Diaz, a hereditary share of. one-twelfth (1/12) of the whole estate of Francisco Reyes Diaz (Art. 996 in relation to Art. 892, par 2, New Civil Code), and the remaining portion of the estate to be divided among the plaintiffs Sinforosa R. Bales, Luz R. Bakunawa, Anacorita Reyes, Ruperto Reyes, Adela Reyes, Priscilla Reyes and defendant Bernardita R. Macariola, in such a way that the extent of the total share of plaintiff Sinforosa R. Bales in the hereditary estate shall not exceed the equivalent of two-fifth (2/5) of the total share of any or each of the other plaintiffs and the defendant (Art. 983, New Civil Code), each of the latter to receive equal shares from the hereditary estate, (Ramirez vs. Bautista, 14 Phil. 528; Diancin vs. Bishop of Jaro, O.G. [3rd Ed.] p. 33); (9) Directing the parties, within thirty days after this judgment shall have become final to submit to this court, for approval a project of partition of the hereditary estate in the proportion above indicated, and in such manner as the parties may, by agreement, deemed convenient and equitable to them taking into consideration the location, kind, quality, nature and value of the properties involved; (10) Directing the plaintiff Sinforosa R. Bales and defendant Bernardita R. Macariola to pay the costs of this suit, in the proportion of one-third (1/3) by the first named and two-thirds (2/3) by the second named; and (I 1) Dismissing all other claims of the parties [pp 27-29 of Exh. C].The decision in civil case 3010 became final for lack of an appeal, and on October 16, 1963, a project of partition was submitted to Judge Asuncion which is marked Exh. A. Notwithstanding the fact that the project of partition was not signed by the parties themselves but only by the respective counsel of plaintiffs and defendant, Judge Asuncion approved it in his Order dated October 23, 1963, which for convenience is quoted hereunder in full:The parties, through their respective counsels, presented to this Court for approval the following project of partition:COMES NOW, the plaintiffs and the defendant in the above-entitled case, to this Honorable Court respectfully submit the following Project of Partition:l. The whole of Lots Nos. 1154, 2304 and 4506 shall belong exclusively to Bernardita Reyes Macariola;2. A portion of Lot No. 3416 consisting of 2,373.49 square meters along the eastern part of the lot shall be awarded likewise to Bernardita R. Macariola;3. Lots Nos. 4803, 4892 and 5265 shall be awarded to Sinforosa Reyes Bales;4. A portion of Lot No. 3416 consisting of 1,834.55 square meters along the western part of the lot shall likewise be awarded to Sinforosa Reyes-Bales;5. Lots Nos. 4474 and 4475 shall be divided equally among Luz Reyes Bakunawa, Anacorita Reyes, Ruperto Reyes, Adela Reyes and Priscilla Reyes in equal shares;6. Lot No. 1184 and the remaining portion of Lot No. 3416 after taking the portions awarded under item (2) and (4) above shall be awarded to Luz Reyes Bakunawa, Anacorita Reyes, Ruperto Reyes, Adela Reyes and Priscilla Reyes in equal shares, provided, however that the remaining portion of Lot No. 3416 shall belong exclusively to Priscilla Reyes.WHEREFORE, it is respectfully prayed that the Project of Partition indicated above which is made in accordance with the decision of the Honorable Court be approved.Tacloban City, October 16, 1963.(SGD) BONIFACIO RAMO Atty. for the Defendant Tacloban City(SGD) ZOTICO A. TOLETE Atty. for the Plaintiff Tacloban CityWhile the Court thought it more desirable for all the parties to have signed this Project of Partition, nevertheless, upon assurance of both counsels of the respective parties to this Court that the Project of Partition, as above- quoted, had been made after a conference and agreement of the plaintiffs and the defendant approving the above Project of Partition, and that both lawyers had represented to the Court that they are given full authority to sign by themselves the Project of Partition, the Court, therefore, finding the above-quoted Project of Partition to be in accordance with law, hereby approves the same. The parties, therefore, are directed to execute such papers, documents or instrument sufficient in form and substance for the vesting of the rights, interests and participations which were adjudicated to the respective parties, as outlined in the Project of Partition and the delivery of the respective properties adjudicated to each one in view of said Project of Partition, and to perform such other acts as are legal and necessary to effectuate the said Project of Partition.SO ORDERED.Given in Tacloban City, this 23rd day of October, 1963.(SGD) ELIAS B. ASUNCION JudgeEXH. B.The above Order of October 23, 1963, was amended on November 11, 1963, only for the purpose of giving authority to the Register of Deeds of the Province of Leyte to issue the corresponding transfer certificates of title to the respective adjudicatees in conformity with the project of partition (see Exh. U).One of the properties mentioned in the project of partition was Lot 1184 or rather one-half thereof with an area of 15,162.5 sq. meters. This lot, which according to the decision was the exclusive property of the deceased Francisco Reyes, was adjudicated in said project of partition to the plaintiffs Luz, Anacorita Ruperto, Adela, and Priscilla all surnamed Reyes in equal shares, and when the project of partition was approved by the trial court the adjudicatees caused Lot 1184 to be subdivided into five lots denominated as Lot 1184-A to 1184-E inclusive (Exh. V).Lot 1184-D was conveyed to Enriqueta D. Anota, a stenographer in Judge Asuncion's court (Exhs. F, F-1 and V-1), while Lot 1184-E which had an area of 2,172.5556 sq. meters was sold on July 31, 1964 to Dr. Arcadio Galapon (Exh. 2) who was issued transfer certificate of title No. 2338 of the Register of Deeds of the city of Tacloban (Exh. 12).On March 6, 1965, Dr. Arcadio Galapon and his wife Sold a portion of Lot 1184-E with an area of around 1,306 sq. meters to Judge Asuncion and his wife, Victoria S. Asuncion (Exh. 11), which particular portion was declared by the latter for taxation purposes (Exh. F).On August 31, 1966, spouses Asuncion and spouses Galapon conveyed their respective shares and interest in Lot 1184-E to "The Traders Manufacturing and Fishing Industries Inc." (Exit 15 & 16). At the time of said sale the stockholders of the corporation were Dominador Arigpa Tan, Humilia Jalandoni Tan, Jaime Arigpa Tan, Judge Asuncion, and the latter's wife, Victoria S. Asuncion, with Judge Asuncion as the President and Mrs. Asuncion as the secretary (Exhs. E-4 to E-7). The Articles of Incorporation of "The Traders Manufacturing and Fishing Industries, Inc." which we shall henceforth refer to as "TRADERS" were registered with the Securities and Exchange Commission only on January 9, 1967 (Exh. E) [pp. 378-385, rec.].Complainant Bernardita R. Macariola filed on August 9, 1968 the instant complaint dated August 6, 1968 alleging four causes of action, to wit: [1] that respondent Judge Asuncion violated Article 1491, paragraph 5, of the New Civil Code in acquiring by purchase a portion of Lot No. 1184-E which was one of those properties involved in Civil Case No. 3010 decided by him; [2] that he likewise violated Article 14, paragraphs I and 5 of the Code of Commerce, Section 3, paragraph H, of R.A. 3019, otherwise known as the Anti-Graft and Corrupt Practices Act, Section 12, Rule XVIII of the Civil Service Rules, and Canon 25 of the Canons of Judicial Ethics, by associating himself with the Traders Manufacturing and Fishing Industries, Inc., as a stockholder and a ranking officer while he was a judge of the Court of First Instance of Leyte; [3] that respondent was guilty of coddling an impostor and acted in disregard of judicial decorum by closely fraternizing with a certain Dominador Arigpa Tan who openly and publicly advertised himself as a practising attorney when in truth and in fact his name does not appear in the Rolls of Attorneys and is not a member of the Philippine Bar; and [4] that there was a culpable defiance of the law and utter disregard for ethics by respondent Judge (pp. 1-7, rec.).Respondent Judge Asuncion filed on September 24, 1968 his answer to which a reply was filed on October 16, 1968 by herein complainant. In Our resolution of October 28, 1968, We referred this case to then Justice Cecilia Muoz Palma of the Court of Appeals, for investigation, report and recommendation. After hearing, the said Investigating Justice submitted her report dated May 27, 1971 recommending that respondent Judge should be reprimanded or warned in connection with the first cause of action alleged in the complaint, and for the second cause of action, respondent should be warned in case of a finding that he is prohibited under the law to engage in business. On the third and fourth causes of action, Justice Palma recommended that respondent Judge be exonerated.The records also reveal that on or about November 9 or 11, 1968 (pp. 481, 477, rec.), complainant herein instituted an action before the Court of First Instance of Leyte, entitled "Bernardita R. Macariola, plaintiff, versus Sinforosa R. Bales, et al., defendants," which was docketed as Civil Case No. 4235, seeking the annulment of the project of partition made pursuant to the decision in Civil Case No. 3010 and the two orders issued by respondent Judge approving the same, as well as the partition of the estate and the subsequent conveyances with damages. It appears, however, that some defendants were dropped from the civil case. For one, the case against Dr. Arcadio Galapon was dismissed because he was no longer a real party in interest when Civil Case No. 4234 was filed, having already conveyed on March 6, 1965 a portion of lot 1184-E to respondent Judge and on August 31, 1966 the remainder was sold to the Traders Manufacturing and Fishing Industries, Inc. Similarly, the case against defendant Victoria Asuncion was dismissed on the ground that she was no longer a real party in interest at the time the aforesaid Civil Case No. 4234 was filed as the portion of Lot 1184 acquired by her and respondent Judge from Dr. Arcadio Galapon was already sold on August 31, 1966 to the Traders Manufacturing and Fishing industries, Inc. Likewise, the cases against defendants Serafin P. Ramento, Catalina Cabus, Ben Barraza Go, Jesus Perez, Traders Manufacturing and Fishing Industries, Inc., Alfredo R. Celestial and Pilar P. Celestial, Leopoldo Petilla and Remedios Petilla, Salvador Anota and Enriqueta Anota and Atty. Zotico A. Tolete were dismissed with the conformity of complainant herein, plaintiff therein, and her counsel.On November 2, 1970, Judge Jose D. Nepomuceno of the Court of First Instance of Leyte, who was directed and authorized on June 2, 1969 by the then Secretary (now Minister) of Justice and now Minister of National Defense Juan Ponce Enrile to hear and decide Civil Case No. 4234, rendered a decision, the dispositive portion of which reads as follows:A. IN THE CASE AGAINST JUDGE ELIAS B. ASUNCION(1) declaring that only Branch IV of the Court of First Instance of Leyte has jurisdiction to take cognizance of the issue of the legality and validity of the Project of Partition [Exhibit "B"] and the two Orders [Exhibits "C" and "C- 3"] approving the partition;(2) dismissing the complaint against Judge Elias B. Asuncion;(3) adjudging the plaintiff, Mrs. Bernardita R. Macariola to pay defendant Judge Elias B. Asuncion,(a) the sum of FOUR HUNDRED THOUSAND PESOS [P400,000.00] for moral damages;(b) the sum of TWO HUNDRED THOUSAND PESOS [P200,000.001 for exemplary damages;(c) the sum of FIFTY THOUSAND PESOS [P50,000.00] for nominal damages; and(d) he sum of TEN THOUSAND PESOS [PI0,000.00] for Attorney's Fees.B. IN THE CASE AGAINST THE DEFENDANT MARIQUITA VILLASIN, FOR HERSELF AND FOR THE HEIRS OF THE DECEASED GERARDO VILLASIN (1) Dismissing the complaint against the defendants Mariquita Villasin and the heirs of the deceased Gerardo Villasin;(2) Directing the plaintiff to pay the defendants Mariquita Villasin and the heirs of Gerardo Villasin the cost of the suit.C. IN THE CASE AGAINST THE DEFENDANT SINFOROSA R. BALES, ET AL., WHO WERE PLAINTIFFS IN CIVIL CASE NO. 3010 (1) Dismissing the complaint against defendants Sinforosa R. Bales, Adela R. Herrer, Priscilla R. Solis, Luz R. Bakunawa, Anacorita R. Eng and Ruperto O. Reyes.D. IN THE CASE AGAINST DEFENDANT BONIFACIO RAMO (1) Dismissing the complaint against Bonifacio Ramo;(2) Directing the plaintiff to pay the defendant Bonifacio Ramo the cost of the suit.SO ORDERED [pp. 531-533, rec.]It is further disclosed by the record that the aforesaid decision was elevated to the Court of Appeals upon perfection of the appeal on February 22, 1971.IWE find that there is no merit in the contention of complainant Bernardita R. Macariola, under her first cause of action, that respondent Judge Elias B. Asuncion violated Article 1491, paragraph 5, of the New Civil Code in acquiring by purchase a portion of Lot No. 1184-E which was one of those properties involved in Civil Case No. 3010. 'That Article provides:Article 1491. The following persons cannot acquire by purchase, even at a public or judicial action, either in person or through the mediation of another:xxx xxx xxx(5) Justices, judges, prosecuting attorneys, clerks of superior and inferior courts, and other officers and employees connected with the administration of justice, the property and rights in litigation or levied upon an execution before the court within whose jurisdiction or territory they exercise their respective functions; this prohibition includes the act of acquiring by assignment and shall apply to lawyers, with respect to the property and rights which may be the object of any litigation in which they may take part by virtue of their profession [emphasis supplied].The prohibition in the aforesaid Article applies only to the sale or assignment of the property which is the subject of litigation to the persons disqualified therein. WE have already ruled that "... for the prohibition to operate, the sale or assignment of the property must take placeduring the pendencyof the litigation involving the property" (The Director of Lands vs. Ababa et al., 88 SCRA 513, 519 [1979], Rosario vda. de Laig vs. Court of Appeals, 86 SCRA 641, 646 [1978]).In the case at bar, when the respondent Judge purchased onMarch 6, 1965a portion of Lot 1184-E, the decision in Civil Case No. 3010 which he rendered onJune 8, 1963was already final because none of the parties therein filed an appeal within the reglementary period; hence, the lot in question was no longer subject of the litigation. Moreover, at the time of the sale on March 6, 1965, respondent's order datedOctober 23, 1963and the amended order datedNovember 11, 1963approving the October 16, 1963 project of partition made pursuant to the June 8, 1963 decision, had long become final for there was no appeal from said orders.Furthermore, respondent Judge did not buy the lot in question on March 6, 1965 directly from the plaintiffs in Civil Case No. 3010 but from Dr. Arcadio Galapon who earlier purchased onJuly 31, 1964Lot 1184-E from three of the plaintiffs, namely, Priscilla Reyes, Adela Reyes, and Luz R. Bakunawa after the finality of the decision in Civil Case No. 3010. It may be recalled that Lot 1184 or more specifically one-half thereof was adjudicated in equal shares to Priscilla Reyes, Adela Reyes, Luz Bakunawa, Ruperto Reyes and Anacorita Reyes in the project of partition, and the same was subdivided into five lots denominated as Lot 1184-A to 1184-E. As aforestated, Lot 1184-E was sold on July 31, 1964 to Dr. Galapon for which he was issued TCT No. 2338 by the Register of Deeds of Tacloban City, and on March 6, 1965 he sold a portion of said lot to respondent Judge and his wife who declared the same for taxation purposes only. The subsequent sale onAugust 31, 1966by spouses Asuncion and spouses Galapon of their respective shares and interest in said Lot 1184-E to the Traders Manufacturing and Fishing Industries, Inc., in which respondent was the president and his wife was the secretary, took place long after the finality of the decision in Civil Case No. 3010 and of the subsequent two aforesaid orders therein approving the project of partition.While it appears that complainant herein filed on or aboutNovember 9 or 11, 1968an action before the Court of First Instance of Leyte docketed as Civil Case No. 4234, seeking to annul the project of partition and the two orders approving the same, as well as the partition of the estate and the subsequent conveyances, the same, however, is of no moment.The fact remains that respondent Judge purchased on March 6, 1965 a portion of Lot 1184-E from Dr. Arcadio Galapon; hence, after the finality of the decision which he rendered onJune 8, 1963in Civil Case No. 3010 and his two questioned orders dated October 23, 1963 and November 11, 1963. Therefore, the property was no longer subject of litigation.The subsequent filing on November 9, or 11, 1968 of Civil Case No. 4234 can no longer alter, change or affect the aforesaid facts that the questioned sale to respondent Judge, now Court of Appeals Justice, was effected and consummated long after the finality of the aforesaid decision or orders.Consequently, the sale of a portion of Lot 1184-E to respondent Judge having taken place over one year after the finality of the decision in Civil Case No. 3010 as well as the two orders approving the project of partition, and not during the pendency of the litigation, there was no violation of paragraph 5, Article 1491 of the New Civil Code.It is also argued by complainant herein that the sale on July 31, 1964 of Lot 1184-E to Dr. Arcadio Galapon by Priscilla Reyes, Adela Reyes and Luz R. Bakunawa was only a mere scheme to conceal the illegal and unethical transfer of said lot to respondent Judge as a consideration for the approval of the project of partition. In this connection, We agree with the findings of the Investigating Justice thus:And so we are now confronted with this all-important question whether or not the acquisition by respondent of a portion of Lot 1184-E and the subsequent transfer of the whole lot to "TRADERS" of which respondent was the President and his wife the Secretary, was intimately related to the Order of respondent approving the project of partition, Exh. A.Respondent vehemently denies any interest or participation in the transactions between the Reyeses and the Galapons concerning Lot 1184-E, and he insists that there is no evidence whatsoever to show that Dr. Galapon had acted, in the purchase of Lot 1184-E, in mediation for him and his wife. (See p. 14 of Respondent's Memorandum).xxx xxx xxxOn this point, I agree with respondent that there is no evidence in the record showing that Dr. Arcadio Galapon acted as a mere "dummy" of respondent in acquiring Lot 1184-E from the Reyeses. Dr. Galapon appeared to this investigator as a respectable citizen, credible and sincere, and I believe him when he testified that he bought Lot 1184-E in good faith and for valuable consideration from the Reyeses without any intervention of, or previous understanding with Judge Asuncion (pp. 391- 394, rec.).On the contention of complainant herein that respondent Judge acted illegally in approving the project of partition although it was not signed by the parties, We quote with approval the findings of the Investigating Justice, as follows:1. I agree with complainant that respondent should have required the signature of the parties more particularly that of Mrs. Macariola on the project of partition submitted to him for approval; however, whatever error was committed by respondent in that respect was done in good faith as according to Judge Asuncion he was assured by Atty. Bonifacio Ramo, the counsel of record of Mrs. Macariola, That he was authorized by his client to submit said project of partition, (See Exh. B and tsn p. 24, January 20, 1969). While it is true that such written authority if there was any, was not presented by respondent in evidence, nor did Atty. Ramo appear to corroborate the statement of respondent, his affidavit being the only one that was presented as respondent's Exh. 10, certain actuations of Mrs. Macariola lead this investigator to believe that she knew the contents of the project of partition, Exh. A, and that she gave her conformity thereto. I refer to the following documents:1) Exh. 9 Certified true copy of OCT No. 19520 covering Lot 1154 of the Tacloban Cadastral Survey in which the deceased Francisco Reyes holds a "1/4 share" (Exh. 9-a). On tills certificate of title the Order dated November 11, 1963, (Exh. U) approving the project of partition was duly entered and registered on November 26, 1963 (Exh. 9-D);2) Exh. 7 Certified copy of a deed of absolute sale executed by Bernardita Reyes Macariola onOctober 22, 1963, conveying to Dr. Hector Decena the one-fourth share of the late Francisco Reyes-Diaz in Lot 1154. In this deed of sale the vendee stated that she was the absolute owner of said one-fourth share, the same having been adjudicated to her as her share in the estate of her father Francisco Reyes Diaz as per decision of the Court of First Instance of Leyte under case No. 3010 (Exh. 7-A). The deed of sale was duly registered and annotated at the back of OCT 19520 on December 3, 1963 (see Exh. 9-e).In connection with the abovementioned documents it is to be noted that in the project of partition dated October 16, 1963, which was approved by respondent on October 23, 1963, followed by an amending Order on November 11, 1963, Lot 1154 or rather 1/4 thereof was adjudicated to Mrs. Macariola. It is this 1/4 share in Lot 1154 which complainant sold to Dr. Decena on October 22, 1963, several days after the preparation of the project of partition.Counsel for complainant stresses the view, however, that the latter sold her one-fourth share in Lot 1154 by virtue of the decision in Civil Case 3010 and not because of the project of partition, Exh. A. Such contention is absurd because from the decision, Exh. C, it is clear that one-half of one- fourth of Lot 1154 belonged to the estate of Francisco Reyes Diaz while the other half of said one-fourth was the share of complainant's mother, Felisa Espiras; in other words, the decision did not adjudicate the whole of the one-fourth of Lot 1154 to the herein complainant (see Exhs. C-3 & C-4). Complainant became the owner of the entire one-fourth of Lot 1154 only by means of the project of partition, Exh. A. Therefore, if Mrs. Macariola sold Lot 1154 on October 22, 1963, it was for no other reason than that she was wen aware of the distribution of the properties of her deceased father as per Exhs. A and B. It is also significant at this point to state that Mrs. Macariola admitted during the cross-examination that she went to Tacloban City in connection with the sale of Lot 1154 to Dr. Decena (tsn p. 92, November 28, 1968) from which we can deduce that she could not have been kept ignorant of the proceedings in civil case 3010 relative to the project of partition.Complainant also assails the project of partition because according to her the properties adjudicated to her were insignificant lots and the least valuable. Complainant, however, did not present any direct and positive evidence to prove the alleged gross inequalities in the choice and distribution of the real properties when she could have easily done so by presenting evidence on the area, location, kind, the assessed and market value of said properties. Without such evidence there is nothing in the record to show that there were inequalities in the distribution of the properties of complainant's father (pp. 386389, rec.).Finally, while it is. true that respondent Judge did not violate paragraph 5, Article 1491 of the New Civil Code in acquiring by purchase a portion of Lot 1184-E which was in litigation in his court, it was, however, improper for him to have acquired the same. He should be reminded of Canon 3 of the Canons of Judicial Ethics which requires that: "A judge's official conduct should be free from the appearance of impropriety, and his personal behavior, not only upon the bench and in the performance of judicial duties, but also in his everyday life, should be beyond reproach." And as aptly observed by the Investigating Justice: "... it was unwise and indiscreet on the part of respondent to have purchased or acquired a portion of a piece of property that was or had been in litigation in his court and caused it to be transferred to a corporation of which he and his wife were ranking officers at the time of such transfer. One who occupies an exalted position in the judiciary has the duty and responsibility of maintaining the faith and trust of the citizenry in the courts of justice, so that not only must he be truly honest and just, but his actuations must be such as not give cause for doubt and mistrust in the uprightness of his administration of justice. In this particular case of respondent, he cannot deny that the transactions over Lot 1184-E are damaging and render his actuations open to suspicion and distrust. Even if respondent honestly believed that Lot 1184-E was no longer in litigation in his court and that he was purchasing it from a third person and not from the parties to the litigation, he should nonetheless have refrained from buying it for himself and transferring it to a corporation in which he and his wife were financially involved, to avoid possible suspicion that his acquisition was related in one way or another to his official actuations in civil case 3010. The conduct of respondent gave cause for the litigants in civil case 3010, the lawyers practising in his court, and the public in general to doubt the honesty and fairness of his actuations and the integrity of our courts of justice" (pp. 395396, rec.).IIWith respect to the second cause of action, the complainant alleged that respondent Judge violated paragraphs 1 and 5, Article 14 of the Code of Commerce when he associated himself with the Traders Manufacturing and Fishing Industries, Inc. as a stockholder and a ranking officer, said corporation having been organized to engage in business. Said Article provides that:Article 14 The following cannot engage in commerce, either in person or by proxy, nor can they hold any office or have any direct, administrative, or financial intervention in commercial or industrial companies within the limits of the districts, provinces, or towns in which they discharge their duties:1. Justices of the Supreme Court, judges and officials of the department of public prosecution in active service. This provision shall not be applicable to mayors, municipal judges, and municipal prosecuting attorneys nor to those who by chance are temporarily discharging the functions of judge or prosecuting attorney.xxx xxx xxx5. Those who by virtue of laws or special provisions may not engage in commerce in a determinate territory.It is Our considered view that although the aforestated provision is incorporated in the Code of Commerce which is part of the commercial laws of the Philippines, it, however, partakes of the nature of a political law as it regulates the relationship between the government and certain public officers and employees, like justices and judges.Political Law has been defined as that branch of public law which deals with the organization and operation of the governmental organs of the State and define the relations of the state with the inhabitants of its territory (People vs. Perfecto, 43 Phil. 887, 897 [1922]). It may be recalled that political law embraces constitutional law, law of public corporations, administrative law including the law on public officers and elections. Specifically, Article 14 of the Code of Commerce partakes more of the nature of an administrative law because it regulates the conduct of certain public officers and employees with respect to engaging in business: hence, political in essence.It is significant to note that the present Code of Commerce is the Spanish Code of Commerce of 1885, with some modifications made by the "Commission de Codificacion de las Provincias de Ultramar," which was extended to the Philippines by the Royal Decree of August 6, 1888, and took effect as law in this jurisdiction on December 1, 1888.Upon the transfer of sovereignty from Spain to the United States and later on from the United States to the Republic of the Philippines, Article 14 of this Code of Commerce must be deemed to have been abrogated because where there is change of sovereignty, the political laws of the former sovereign, whether compatible or not with those of the new sovereign, are automatically abrogated, unless they are expressly re-enacted by affirmative act of the new sovereign.Thus, We held inRoa vs. Collector of Customs(23 Phil. 315, 330, 311 [1912]) that:By well-settled public law, upon the cession of territory by one nation to another, either following a conquest or otherwise, ... those laws which are political in their nature and pertain to the prerogatives of the former government immediately cease upon the transfer of sovereignty. (Opinion, Atty. Gen., July 10, 1899).While municipal laws of the newly acquired territory not in conflict with the, laws of the new sovereign continue in force without the express assent or affirmative act of the conqueror, the political laws do not. (Halleck's Int. Law, chap. 34, par. 14). However, such political laws of the prior sovereignty as are not in conflict with the constitution or institutions of the new sovereign, may be continued in force if the conqueror shall so declare by affirmative act of the commander-in-chief during the war, or by Congress in time of peace. (Ely's Administrator vs. United States, 171 U.S. 220, 43 L. Ed. 142). In the case of American and Ocean Ins. Cos. vs. 356 Bales of Cotton (1 Pet. [26 U.S.] 511, 542, 7 L. Ed. 242), Chief Justice Marshall said:On such transfer (by cession) of territory, it has never been held that the relations of the inhabitants with each other undergo any change. Their relations with their former sovereign are dissolved, and new relations are created between them and the government which has acquired their territory. The same act which transfers their country, transfers the allegiance of those who remain in it; and the law which may be denominated political, is necessarily changed, although that which regulates the intercourse and general conduct of individuals, remains in force, until altered by the newly- created power of the State.Likewise, inPeople vs. Perfecto(43 Phil. 887, 897 [1922]), this Court stated that: "It is a general principle of the public law that on acquisition of territory the previous political relations of the ceded region are totally abrogated. "There appears no enabling or affirmative act that continued the effectivity of the aforestated provision of the Code of Commerce after the change of sovereignty from Spain to the United States and then to the Republic of the Philippines. Consequently, Article 14 of the Code of Commerce has no legal and binding effect and cannot apply to the respondent, then Judge of the Court of First Instance, now Associate Justice of the Court of Appeals.It is also argued by complainant herein that respondent Judge violated paragraph H, Section 3 of Republic Act No. 3019, otherwise known as the Anti-Graft and Corrupt Practices Act, which provides that:Sec. 3. Corrupt practices of public officers. In addition to acts or omissions of public officers already penalized by existing law, the following shall constitute corrupt practices of any public officer and are hereby declared to be unlawful:xxx xxx xxx(h) Directly or indirectly having financial or pecuniary interest in any business, contract or transaction in connection with which he intervenes or takes part in his official capacity, or in which he is prohibited by the Constitution or by any Iaw from having any interest.Respondent Judge cannot be held liable under the aforestated paragraph because there is no showing that respondent participated or intervenedin his officialcapacity in the business or transactions of the Traders Manufacturing and Fishing Industries, Inc. In the case at bar, the business of the corporation in which respondent participated has obviously no relation or connection with his judicial office. The business of said corporation is not that kind where respondent intervenes or takes part in his capacity as Judge of the Court of First Instance. As was held in one case involving the application of Article 216 of the Revised Penal Code which has a similar prohibition on public officers against directly or indirectly becoming interested in any contract or business in which it is his official duty to intervene, "(I)t is not enough to be a public official to be subject to this crime; it is necessary that by reason of his office, he has to intervene in said contracts or transactions; and, hence, the official who intervenes in contracts or transactions which have no relation to his office cannot commit this crime.' (People vs. Meneses, C.A. 40 O.G. 11th Supp. 134, cited by Justice Ramon C. Aquino; Revised Penal Code, p. 1174, Vol. 11 [1976]).It does not appear also from the records that the aforesaid corporation gained any undue advantage in its business operations by reason of respondent's financial involvement in it, or that the corporation benefited in one way or another in any case filed by or against it in court. It is undisputed that there was no case filed in the different branches of the Court of First Instance of Leyte in which the corporation was either party plaintiff or defendant except Civil Case No. 4234 entitled "Bernardita R. Macariola, plaintiff, versus Sinforosa O. Bales, et al.,"wherein the complainant herein sought to recover Lot 1184-E from the aforesaid corporation. It must be noted, however, that Civil Case No. 4234 was filed only on November 9 or 11, 1968 and decided on November 2, 1970 by CFI Judge Jose D. Nepomuceno when respondent Judge was no longer connected with the corporation, having disposed of his interest therein on January 31, 1967.Furthermore, respondent is not liable under the same paragraph because there is no provision in both the 1935 and 1973 Constitutions of the Philippines, nor is there an existing law expressly prohibiting members of the Judiciary from engaging or having interest in any lawful business.It may be pointed out that Republic Act No. 296, as amended, also known as the Judiciary Act of 1948, does not contain any prohibition to that effect. As a matter of fact, under Section 77 of said law, municipal judges may engage in teaching or other vocation not involving the practice of law after office hours but with the permission of the district judge concerned.Likewise, Article 14 of the Code of Commerce which prohibits judges from engaging in commerce is, as heretofore stated, deemed abrogated automatically upon the transfer of sovereignty from Spain to America, because it is political in nature.Moreover, the prohibition in paragraph 5, Article 1491 of the New Civil Code against the purchase by judges of a property in litigation before the court within whose jurisdiction they perform their duties, cannot apply to respondent Judge because the sale of the lot in question to him took place after the finality of his decision in Civil Case No. 3010 as well as his two orders approving the project of partition; hence, the property was no longer subject of litigation.In addition, although Section 12, Rule XVIII of the Civil Service Rules made pursuant to the Civil Service Act of 1959 prohibits an officer or employee in the civil service from engaging in any private business, vocation, or profession or be connected with any commercial, credit, agricultural or industrial undertaking without a written permission from the head of department, the same, however, may not fall within the purview of paragraph h, Section 3 of the Anti-Graft and Corrupt Practices Act because the last portion of said paragraph speaks of a prohibition by theConstitution or lawon any public officer from having any interest in any business and not by a mere administrative rule or regulation. Thus, a violation of the aforesaid rule by any officer or employee in the civil service, that is, engaging in private business without a written permission from the Department Head may not constitute graft and corrupt practice as defined by law.On the contention of complainant that respondent Judge violated Section 12, Rule XVIII of the Civil Service Rules, We hold that the Civil Service Act of 1959 (R.A. No. 2260) and the Civil Service Rules promulgated thereunder, particularly Section 12 of Rule XVIII, do not apply to the members of the Judiciary. Under said Section 12: "No officer or employee shall engage directly in any private business, vocation, or profession or be connected with any commercial, credit, agricultural or industrial undertaking without a written permission from the Head of Department ..."It must be emphasized at the outset that respondent, being a member of the Judiciary, is covered by Republic Act No. 296, as amended, otherwise known as the Judiciary Act of 1948 and by Section 7, Article X, 1973 Constitution.Under Section 67 of said law, the power to remove or dismiss judges was then vested in the President of the Philippines, not in the Commissioner of Civil Service, and only on two grounds, namely, serious misconduct and inefficiency, and upon the recommendation of the Supreme Court, which alone is authorized, upon its own motion, or upon information of the Secretary (now Minister) of Justice to conduct the corresponding investigation. Clearly, the aforesaid section defines the grounds and prescribes the special procedure for the discipline of judges.And under Sections 5, 6 and 7, Article X of the 1973 Constitution, only the Supreme Court can discipline judges of inferior courts as well as other personnel of the Judiciary.It is true that under Section 33 of the Civil Service Act of 1959: "The Commissioner may, for ... violation of the existing Civil Service Law and rules or of reasonable office regulations, or in the interest of the service, remove any subordinate officer or employee from the service, demote him in rank, suspend him for not more than one year without pay or fine him in an amount not exceeding six months' salary." Thus, a violation of Section 12 of Rule XVIII is a ground for disciplinary action against civil service officers and employees.However, judges cannot be considered as subordinate civil service officers or employees subject to the disciplinary authority of the Commissioner of Civil Service; for, certainly, the Commissioner is not the head of the Judicial Department to which they belong. The Revised Administrative Code (Section 89) and the Civil Service Law itself state that the Chief Justice is the department head of the Supreme Court (Sec. 20, R.A. No. 2260) [1959]); and under the 1973 Constitution, the Judiciary is the only other or second branch of the government (Sec. 1, Art. X, 1973 Constitution). Besides, a violation of Section 12, Rule XVIII cannot be considered as a ground for disciplinary action against judges because to recognize the same as applicable to them, would be adding another ground for the discipline of judges and, as aforestated, Section 67 of the Judiciary Act recognizes only two grounds for their removal, namely, serious misconduct and inefficiency.Moreover, under Section 16(i) of the Civil Service Act of 1959, it is the Commissioner of Civil Service who has original and exclusive jurisdiction "(T)o decide, within one hundred twenty days, after submission to it, all administrative cases againstpermanent officers and employees in the competitive service, and, except as provided by law, to have final authority to pass upon their removal, separation, and suspension and upon all matters relating to the conduct, discipline, and efficiency of such officers and employees; and prescribe standards, guidelines and regulations governing the administration of discipline" (emphasis supplied). There is no question that a judge belong to the non-competitive or unclassified service of the government as a Presidential appointee and is therefore not covered by the aforesaid provision. WE have already ruled that "... in interpreting Section 16(i) of Republic Act No. 2260, we emphasized that only permanent officers and employees who belong to the classified service come under the exclusive jurisdiction of the Commissioner of Civil Service" (Villaluz vs. Zaldivar, 15 SCRA 710,713 [1965], Ang-Angco vs. Castillo, 9 SCRA 619 [1963]).Although the actuation of respondent Judge in engaging in private business by joining the Traders Manufacturing and Fishing Industries, Inc. as a stockholder and a ranking officer, is not violative of the provissions of Article 14 of the Code of Commerce and Section 3(h) of the Anti-Graft and Corrupt Practices Act as well as Section 12, Rule XVIII of the Civil Service Rules promulgated pursuant to the Civil Service Act of 1959, the impropriety of the same is clearly unquestionable because Canon 25 of the Canons of Judicial Ethics expressly declares that:A judge should abstain from making personal investments in enterprises which are apt to be involved in litigation in his court; and, after his accession to the bench, he should not retain such investments previously made, longer than a period sufficient to enable him to dispose of them without serious loss. It is desirable that he should, so far as reasonably possible, refrain from all relations which would normally tend to arouse the suspicion that such relations warp or bias his judgment, or prevent his impartial attitude of mind in the administration of his judicial duties. ...WE are not, however, unmindful of the fact that respondent Judge and his wife had withdrawn on January 31, 1967 from the aforesaid corporation and sold their respective shares to third parties, and it appears also that the aforesaid corporation did not in anyway benefit in any case filed by or against it in court as there was no case filed in the different branches of the Court of First Instance of Leyte from the time of the drafting of the Articles of Incorporation of the corporation on March 12, 1966, up to its incorporation on January 9, 1967, and the eventual withdrawal of respondent on January 31, 1967 from said corporation. Such disposal or sale by respondent and his wife of their shares in the corporation only 22 days after the incorporation of the corporation, indicates that respondent realized that early that their interest in the corporation contravenes the aforesaid Canon 25. Respondent Judge and his wife therefore deserve the commendation for their immediate withdrawal from the firm after its incorporation and before it became involved in any court litigationIIIWith respect to the third and fourth causes of action, complainant alleged that respondent was guilty of coddling an impostor and acted in disregard of judicial decorum, and that there was culpable defiance of the law and utter disregard for ethics. WE agree, however, with the recommendation of the Investigating Justice that respondent Judge be exonerated because the aforesaid causes of action are groundless, and WE quote the pertinent portion of her report which reads as follows:The basis for complainant's third cause of action is the claim that respondent associated and closely fraternized with Dominador Arigpa Tan who openly and publicly advertised himself as a practising attorney (see Exhs. I, I-1 and J) when in truth and in fact said Dominador Arigpa Tan does not appear in the Roll of Attorneys and is not a member of the Philippine Bar as certified to in Exh. K.The "respondent denies knowing that Dominador Arigpa Tan was an "impostor" and claims that all the time he believed that the latter was abona fidemember of the bar. I see no reason for disbelieving this assertion of respondent. It has been shown by complainant that Dominador Arigpa Tan represented himself publicly as an attorney-at-law to the extent of putting up a signboard with his name and the words "Attorney-at Law" (Exh. I and 1- 1) to indicate his office, and it was but natural for respondent and any person for that matter to have accepted that statement on its face value. "Now with respect to the allegation of complainant that respondent is guilty of fraternizing with Dominador Arigpa Tan to the extent of permitting his wife to be a godmother of Mr. Tan's child at baptism (Exh. M & M-1), that fact even if true did not render respondent guilty of violating any canon of judicial ethics as long as his friendly relations with Dominador A. Tan and family did not influence his official actuations as a judge where said persons were concerned. There is no tangible convincing proof that herein respondent gave any undue privileges in his court to Dominador Arigpa Tan or that the latter benefitted in his practice of law from his personal relations with respondent, or that he used his influence, if he had any, on the Judges of the other branches of the Court to favor said Dominador Tan.Of course it is highly desirable for a member of the judiciary to refrain as much as possible from maintaining close friendly relations with practising attorneys and litigants in his court so as to avoid suspicion 'that his social or business relations or friendship constitute an element in determining his judicial course" (par. 30, Canons of Judicial Ethics), but if a Judge does have social relations, that in itself would not constitute a ground for disciplinary action unless it be clearly shown that his social relations be clouded his official actuations with bias and partiality in favor of his friends (pp. 403-405, rec.).In conclusion, while respondent Judge Asuncion, now Associate Justice of the Court of Appeals, did not violate any law in acquiring by purchase a parcel of land which was in litigation in his court and in engaging in business by joining a private corporation during his incumbency as judge of the Court of First Instance of Leyte, he should be reminded to be more discreet in his private and business activities, because his conduct as a member of the Judiciary must not only be characterized with propriety but must always be above suspicion.WHEREFORE, THE RESPONDENT ASSOCIATE JUSTICE OF THE COURT OF APPEALS IS HEREBY REMINDED TO BE MORE DISCREET IN HIS PRIVATE AND BUSINESS ACTIVITIES.SO ORDERED.Republic of the PhilippinesSUPREME COURTManilaEN BANCG.R. No. 133879 November 21, 2001EQUATORIAL REALTY DEVELOPMENT, INC.,petitioner,vs.MAYFAIR THEATER, INC.,respondent.PANGANIBAN,J.:General propositions do not decide specific cases. Rather, laws are interpreted in the context of the peculiar factual situation of each proceeding. Each case has its own flesh and blood and cannot be ruled upon on the basis of isolated clinical classroom principles.While we agree with the general proposition that a contract of sale is valid until rescinded, it is equally true that ownership of the thing sold is not acquired by mere agreement, but by tradition or delivery. The peculiar facts of the present controversy as found by this Court in an earlier relevant Decision show that delivery was not actually effected; in fact, it was prevented by a legally effective impediment. Not having been the owner, petitioner cannot be entitled to the civil fruits of ownership like rentals of the thing sold. Furthermore, petitioner's bad faith, as again demonstrated by the specific factual milieu of said Decision, bars the grant of such benefits. Otherwise, bad faith would be rewarded instead of punished.The CaseFiled before this Court is a Petition for Review1under Rule 45 of the Rules of Court, challenging the March 11, 1998 Order2of the Regional Trial Court of Manila (RTC), Branch 8, in Civil Case No. 97-85141. The dispositive portion of the assailed Order reads as follows:"WHEREFORE, the motion to dismiss filed by defendant Mayfair is hereby GRANTED, and the complaint filed by plaintiff Equatorial is hereby DISMISSED."3Also questioned is the May 29, 1998 RTC Order4denying petitioner's Motion for Reconsideration.The FactsThe main factual antecedents of the present Petition are matters of record, because it arose out of an earlier case decided by this Court on November 21, 1996, entitledEquatorial Realty Development, Inc. v. Mayfair Theater, Inc.5(henceforth referred to as the "mother case"), docketed as G.R No. 106063.Carmelo & Bauermann, Inc. ("Camelo" ) used to own a parcel of land, together with two 2-storey buildings constructed thereon, located at Claro M. Recto Avenue, Manila, and covered by TCT No. 18529 issued in its name by the Register of Deeds of Manila.On June 1, 1967, Carmelo entered into a Contract of Lease with Mayfair Theater Inc. ("Mayfair") for a period of 20 years. The lease covered a portion of the second floor and mezzanine of a two-storey building with about 1,610 square meters of floor area, which respondent used as a movie house known as Maxim Theater.Two years later, on March 31, 1969, Mayfair entered into a second Contract of Lease with Carmelo for the lease of another portion of the latter's property namely, a part of the second floor of the two-storey building, with a floor area of about 1,064 square meters; and two store spaces on the ground floor and the mezzanine, with a combined floor area of about 300 square meters. In that space, Mayfair put up another movie house known as Miramar Theater. The Contract of Lease was likewise for a period of 20 years.Both leases contained a provision granting Mayfair a right of first refusal to purchase the subject properties. However, on July 30, 1978 within the 20-year-lease term the subject properties were sold by Carmelo to Equatorial Realty Development, Inc. ("Equatorial") for the total sum of P11,300,000, without their first being offered to Mayfair.As a result of the sale of the subject properties to Equatorial, Mayfair filed a Complaint before the Regional Trial Court of Manila (Branch 7) for (a) the annulment of the Deed of Absolute Sale between Carmelo and Equatorial, (b) specific performance, and (c) damages. After trial on the merits, the lower court rendered a Decision in favor of Carmelo and Equatorial. This case, entitled "Mayfair" Theater, Inc. v. Carmelo and Bauermann, Inc., et al.," was docketed as Civil Case No. 118019.On appeal (docketed as CA-GR CV No. 32918), the Court of Appeals (CA) completely reversed and set aside the judgment of the lower court.The controversy reached this Court via G.R No. 106063. In this mother case, it denied the Petition for Review in this wise:"WHEREFORE, the petition for review of the decision of the Court of Appeals, dated June 23, 1992, in CA-G.R. CV No. 32918, is HEREBY DENIED. The Deed of Absolute Sale between petitioners Equatorial Realty Development, Inc. and Carmelo & Bauermann, Inc. is hereby deemed rescinded; Carmelo & Bauermann is ordered to return to petitioner Equatorial Realty Development the purchase price. The latter is directed to execute the deeds and documents necessary to return ownership to Carmelo & Bauermann of the disputed lots. Carmelo & Bauermann is ordered to allow Mayfair Theater, Inc. to buy the aforesaid lots for P11,300,000.00."6The foregoing Decision of this Court became final and executory on March 17, 1997. On April 25, 1997, Mayfair filed a Motion for Execution, which the trial court granted.However, Carmelo could no longer be located. Thus, following the order of execution of the trial court, Mayfair deposited with the clerk of courta quoits payment to Carmelo in the sum of P11,300,000 less; P847,000 as withholding tax. The lower court issued a Deed of Reconveyance in favor of Carmelo and a Deed of Sale in favor of Mayfair. On the basis of these documents, the Registry of Deeds of Manila canceled Equatorial's titles and issued new Certificates of Title7in the name of Mayfair.Ruling on Equatorial's Petition for Certiorari and Petition contesting the foregoing manner of execution, the CA in its Resolution of November 20, 1998, explained that Mayfair had no right to deduct the P847,000 as withholding tax. Since Carmelo could no longer be located, the appellate court ordered Mayfair to deposit the said sum with the Office of the Clerk of Court, Manila, to complete the full amount of P11,300,000 to be turned over to Equatorial.Equatorial questioned the legality of the above CA ruling before this Court in G.R No. 136221 entitled "Equatorial Realty Development, Inc. v. Mayfair Theater, Inc." In a Decision promulgated on May 12, 2000,8this Court directed the trial court to follow strictly the Decision in GR. No. 106063, the mother case. It explained its ruling in these words:"We agree that Carmelo and Bauermann is obliged to return the entire amount of eleven million three hundred thousand pesos (P11,300,000.00) to Equatorial. On the other hand, Mayfair may not deduct from the purchase price the amount of eight hundred forty-seven thousand pesos (P847,000.00) as withholding tax. The duty to withhold taxes due, if any, is imposed on the seller Carmelo and Bauermann, Inc."9Meanwhile, on September 18, 1997 barely five months after Mayfair had submitted its Motion for Execution before the RTC of Manila, Branch 7 Equatorial filed with the Regional Trial Court of Manila, Branch 8, an action for the collection of a sum of money against Mayfair, claiming payment of rentals or reasonable compensation for the defendant's use of the subject premisesafterits lease contracts had expired. This action was the progenitor of the present case.In its Complaint, Equatorial alleged among other things that the Lease Contract covering the premises occupied by Maxim Theater expired on May 31, 1987, while the Lease Contract covering the premises occupied by Miramar Theater lapsed on March 31, 1989.10Representing itself as the owner of the subject premises by reason of the Contract of Sale on July 30, 1978, it claimed rentals arising from Mayfair's occupation thereof.Ruling of the RTC Manila, Branch 8As earlier stated, the trial court dismissed the Complaint via the herein assailed Order and denied the Motion for Reconsideration filed by Equatorial.11The lower court debunked the claim of petitioner for unpaid back rentals, holding that the rescission of the Deed of Absolute Sale in the mother case did not confer on Equatorial any vested or residual proprietary rights, even in expectancy.In granting the Motion to Dismiss, the courta quoheld that the critical issue was whether Equatorial was the owner of the subject property and could thus enjoy the fruits or rentals therefrom. It declared the rescinded Deed of Absolute Sale as avoid at its inception as though it did not happen."The trial court ratiocinated as follows:"The meaning of rescind in the aforequoted decision is to set aside. In the caseof Ocampo v. Court of Appeals, G.R. No. 97442, June 30, 1994, the Supreme Court held that, 'to rescind is to declare a contract void in its inception and to put an end as though it never were. It is not merely to terminate it and release parties from further obligations to each other but to abrogate it from the beginning and restore parties to relative positions which they would have occupied had no contract ever been made.'"Relative to the foregoing definition, the Deed of Absolute Sale between Equatorial and Carmelo dated July 31, 1978 isvoidat its inception as though it did not happen."The argument of Equatorial that this complaint for back rentals as 'reasonable compensation for use of the subject propertyafter expiration of the lease contractspresumes that the Deed of Absolute Sale dated July 30, 1978 from whence the fountain of Equatorial's all rights flows is still valid and existing.xxx xxx xxx"The subject Deed of Absolute Sale having been rescinded by the Supreme Court, Equatorial is not the owner and does not have any right to demand backrentals from the subject property. . .12The trial court added: "The Supreme Court i