Gallar vs. Husain

An action to quiet title brought by a plaintiff who is in actual possession of the property is imprescriptible; where the plaintiff is out of possession, the action is one for recovery of real property and must be commenced within the statutory period of limitation. The right of repurchase in a pacto de retro sale is personal to the vendor and may not be exercised unilaterally by a third party on his behalf without authority; the delivery of possession under a private deed of sale consummates the transfer of ownership.

Teodoro Husain sold a hectare of rice land in Cabatuan, Iloilo, to Serapio Chichirita on January 9, 1919, under a private deed of pacto de retro sale for P30, reserving the right to repurchase within six years. Nineteen days later, Chichirita affixed an annotation on the back of the deed reciting receipt of payment from Graciana Husain, Teodoro’s sister, and transferred his rights to her. Graciana subsequently annotated her own transfer of those rights to Elias Gallar in exchange for a cow, delivering both the land and the owner’s duplicate certificate of title on April 2, 1919. Gallar remained in possession from that date. In 1960, after an unsuccessful cadastral petition to obtain a transfer certificate of title, Gallar sued the heirs of Teodoro Husain to compel the execution of a deed of conveyance and to quiet his title.

• The Original Pacto de Retro Sale: On January 9, 1919, Teodoro Husain executed a private deed of sale written in Ilongo dialect conveying a parcel of rice land in Barrio Salacay, Cabatuan, Iloilo, to Serapio Chichirita for P30. The deed granted Teodoro the right to repurchase within six years, failing which the sale would become absolute and irrevocable under the Ley Hipotecaria.
• The Transfer to Graciana Husain: On January 28, 1919, Chichirita wrote an annotation on the reverse side of the deed, acknowledging receipt of the P30 from Graciana Husain and transferring his rights to her. The annotation described the payment as “redemption (gawad) of the same land.” Graciana was Teodoro’s sister.
• The Transfer to Elias Gallar: On April 2, 1919, Graciana Husain annotated the deed a second time, transferring all her rights to Elias Gallar in exchange for one cow. On the same date, possession of the land and the owner’s duplicate certificate of title were delivered to Gallar, who remained in possession thereafter.
• Confirmatory Affidavits: On March 6, 1928, Chichirita executed an affidavit confirming the “redemption” by Graciana; Graciana executed a separate affidavit of the same date confirming her subsequent sale to Gallar.
• Cadastral Proceeding: In 1960, Gallar petitioned the Cadastral Court for a transfer certificate of title. The court dismissed the petition for lack of jurisdiction but granted the amendment of the certificate’s surname from “Osaen” to “Husain.”
• Trial Court Action: Gallar filed suit in the Court of First Instance on October 10, 1960, to compel Teodoro’s heirs—Hermenegilda and Bonifacio Husain—to execute a deed of conveyance, and to recover damages. The heirs denied the sale, insisted the original transaction was an equitable mortgage extinguished by Graciana’s payment, raised prescription, and counterclaimed for damages. The trial court ordered the heirs to execute the deed, treating the suit as in the nature of quieting title and holding that delivery of possession consummated the sale.

• Nature of the Transaction: Appellant Bonifacio Husain maintained that the 1919 pacto de retro sale was in reality an equitable mortgage intended to secure a loan of P30.
• Effect of Payment by Graciana Husain: Appellant argued that Graciana Husain’s payment of P30 to Chichirita on January 28, 1919, constituted redemption of the land, thereby discharging the mortgage and returning full ownership to the vendor Teodoro Husain.
• Prescription: Appellant invoked prescription as a bar to Gallar’s action to compel execution of a deed of conveyance.
• Identity of the Land: Appellant contended for the first time on appeal that the land described in the private deed of sale was not the same land as Lot No. 766 covered by Original Certificate of Title No. 4521.

• Validity of the Transfers: Appellee Elias Gallar asserted that the successive transfers from Chichirita to Graciana Husain and then to himself were valid sales, not a redemption on behalf of the original vendor. Graciana acquired Chichirita’s rights in her own capacity and validly conveyed them to Gallar.
• Consolidation of Ownership: Gallar maintained that because Teodoro Husain failed to repurchase within the six-year period ending January 9, 1925, ownership was consolidated in him as the ultimate vendee.
• Imprescriptibility: Gallar argued that, being in possession of the land, his action to quiet title was imprescriptible under the rule in Sapto v. Fabiana.
• Change of Theory on Appeal: Gallar objected to the newly raised issue of land identity, asserting that appellant had joined issue at trial solely on the nature of the contract and prescription, and was barred from changing theory on appeal.

• Redemption/Transfer of Rights: Whether the annotation on the deed constituted a redemption by Graciana Husain on behalf of the vendor Teodoro Husain, or a sale transferring the vendee’s rights to Graciana in her personal capacity.
• Prescription: Whether the action to compel the execution of a deed of conveyance was barred by prescription.
• Change of Theory: Whether appellant could raise the issue that the land in the private deed was different from Lot No. 766 for the first time on appeal.

• Redemption/Transfer of Rights: The annotation was treated as a transfer of the vendee’s rights to Graciana Husain in her personal capacity, not as a redemption exercised on behalf of Teodoro Husain. No evidence showed Graciana was acting for her brother. The right of repurchase in a pacto de retro sale is personal to the vendor and may be exercised only by the vendor or by a person to whom the right has been formally transferred. Graciana’s lack of authority precluded treating her act as a redemption that reconveyed title to the vendor. She thus became the new owner, subject only to Teodoro’s right of repurchase, and validly transferred her interest to Gallar. When Teodoro failed to redeem within the six-year period, ownership consolidated in Gallar.
• Prescription: The action was not barred by prescription. The suit was not for specific performance but one to quiet title under Article 476 of the Civil Code, aimed at removing a cloud cast by the heirs’ refusal to recognize the sale. Because Gallar had been in possession of the land since April 2, 1919, the action to quiet title was imprescriptible. Prescription would have applied only if the plaintiff were not in possession, in which case the action would be considered one for recovery of real property governed by the statutory limitation.
• Change of Theory: The issue of the land’s identity could not be raised on appeal. The records showed that appellant’s defense at trial was confined to the equitable mortgage and prescription theories. Having joined issue on those grounds, appellant was bound by his theory and could not for the first time on appeal challenge the identity of the land without violating the rule against changing theory.

• Imprescriptibility of Action to Quiet Title by Possessor — An action to quiet title brought by a plaintiff in actual possession of the property is imprescriptible. If the plaintiff is out of possession, the action is considered one for recovery of real property and must be brought within the applicable prescriptive period. The Court applied this rule to reject the defense and relied on Sapto v. Fabiana.
• Personal Character of the Right of Repurchase — The right to repurchase under a pacto de retro sale is personal to the vendor and may be exercised only by the vendor or by a person to whom the right has been legally transferred. A third party who pays the vendee without authority from the vendor does not effect a redemption binding on the vendor. This principle was derived from Ordoñez v. Villaroman and Gonzaga v. Garcia.
• Rule Against Changing Theory on Appeal — A party who advances a specific theory at trial and joins issue on that basis may not change his theory on appeal, as the adverse party would be denied a fair opportunity to present controverting evidence. This rule was anchored on Quinio v. Muñoz and Agoncillo v. Javier.
• Validity of Sale of Land Through Private Instrument — A sale of real property consigned in a private instrument is valid and binding between the parties; delivery of possession consummates the transfer of ownership.

• “Graciana Husain must, therefore, be deemed to have acquired the land in her own right, subject only to Teodoro Husain’s right of redemption.”
• “This action is not for specific performance; all it seeks is to quiet title, to remove the cloud cast on appellee’s ownership as a result of appellant’s refusal to recognize the sale made by their predecessor. And, as plaintiff-appellee is in possession of the land, the action is imprescriptible.”
• “Appellant’s argument that the action has prescribed would be correct if they were in possession as the action to quiet title would then be an action for recovery of real property which must be brought within the statutory period of limitation governing such actions.”

• Sapto v. Fabiana, G.R. No. L-11285, May 16, 1958 — Applied. The Court relied on this case for the rule that an action to quiet title by a plaintiff in possession is imprescriptible.
• Ordoñez v. Villaroman, 78 Phil. 117 (1947) — Cited. Recognized the personal nature of the right of repurchase.
• Gonzaga v. Garcia, 27 Phil. 7 (1914) — Cited. Established that the right of repurchase may be exercised only by the vendor or his assignee.
• Quinio v. Muñoz, G.R. No. L-17222, Oct. 29, 1965; Agoncillo v. Javier, 38 Phil. 424 (1918) — Applied. Enforced the rule that a change of theory on appeal is impermissible.

• Article 476, Philippine Civil Code — The action to quiet title is available to a person in possession whenever a cloud is cast upon ownership or other interest. The Court characterized Gallar’s suit under this article and ruled it imprescriptible because of his continuing possession.
• Article 1158, Spanish Civil Code (now Article 1236, Philippine Civil Code) — A debt may be satisfied by a third person even without the debtor’s consent. The Court distinguished this rule on payment of debts from the exercise of the right of repurchase, which remains personal to the vendor.
• Article 1268, Spanish Civil Code (now Article 1356, Philippine Civil Code) — Contracts must be in a form required by law for their validity, but sale of land through a private instrument is valid. The Court cited this provision to uphold the unregistered successive sales.

Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Bengzon, J.P., Zaldivar, Sanchez, and Castro, JJ., concurred.