Lacbayan v. Samoy their business partnership by executing a Partition Agreement.

Initially,
GR No. 165427 | March 21, 2011 | Meaning of Co-ownership; Governing law| Samoy agreed to Lacbayan's proposal that the properties in Malvar St. and
Villarama| Da Silva Don Enrique Heights be assigned to the latter, while the ownership over the
three other properties will go to Samoy. However, when Lacbayan made
Petitioner: Betty Lacbayan
additional demands, Samoy refused. Thus, Lacbayan filed a complaint for
Respondents: Bayani Samoy
judicial partition of the said properties before the Quezon City RTC. In his
Answer, however, Samoy denied Lacbayan's claim of cohabitation and said
Recit-Ready: Lacbayan and Samoy had an illicit relationship. They were able to
that the properties were acquired out of his own personal funds without any
establish a manpower services company with three other incorporators. They
contribution from her.
acquired 5 parcels of land registered in the names of Lacbayan and Samoy
ostensibly as husband and wife. When their relationship went south, they agreed to
terminate their business and execute a partition agreement. Initially, they agreed on a
ISSUE/S:
partition arrangement, but when Lacbayan made additional demands, Samoy
refused. Because of this, Lacbayan filed a complaint for partition before the courts. W/N an action for partition precludes a settlement on the issue of ownership - NO
The court a quo held that the properties belonged to Samoy, as Lacbayan did not
provide sufficient evidence to show her own contribution to the acquisition of the RATIO:
properties. Unable to get a favorable ruling, she elevated the case to the Supreme
Court. The issue in this case is whether or not an action for partition precludes a While it is true that the complaint involved here is one for partition, the same is
settlement on the issue of ownership. The Court here said no. Although the action premised on the existence or non-existence of co-ownership between the parties.
brought forth was an action for partition, the Court said it was first necessary to rule Petitioner insists she is a co-owner pro indiviso of the five real estate properties
on the existence of a co-ownership in order to determine if the parties to the based on the transfer certificates of title (TCTs) covering the subject properties.
supposed partition agreement indeed had rights to the property encompassed by the Respondent maintains otherwise. Indubitably, therefore, until and unless this issue of
same. co-ownership is definitely and finally resolved, it would be premature to effect a
partition of the disputed properties. More importantly, the complaint will not even lie if
Doctrine: There is no dispute that a Torrens certificate of title cannot be collaterally the claimant, or petitioner in this case, does not even have any rightful interest over
attacked, but that rule is not material to the case at bar. What cannot be collaterally the subject properties.
attacked is the certificate of title and not the title itself. The certificate referred to is
that document issued by the Register of Deeds known as the TCT. In contrast, the There is no dispute that a Torrens certificate of title cannot be collaterally attacked,
title referred to by law means ownership which is, more often than not, represented but that rule is not material to the case at bar. What cannot be collaterally attacked is
by that document. Petitioner apparently confuses title with the certificate of title. the certificate of title and not the title itself. The certificate referred to is that
Title as a concept of ownership should not be confused with the certificate of title as document issued by the Register of Deeds known as the TCT. In contrast, the title
evidence of such ownership although both are interchangeably used. referred to by law means ownership which is, more often than not, represented by that
document. Petitioner apparently confuses title with the certificate of title. Title as a
FACTS: concept of ownership should not be confused with the certificate of title as evidence
of such ownership although both are interchangeably used.
1. During Betty Lacbayan and Bayani Samoy’s illicit relationship, they, together
with three more incorporators, were able to establish a manpower Moreover, placing a parcel of land under the mantle of the Torrens system does not
services company, by which they acquired 5 parcels of land, registered mean that ownership thereof can no longer be disputed. Ownership is different from a
in their names, ostensibly as husband and wife. Having parted ways certificate of title, the latter only serving as the best proof of ownership over a piece
eventually, both of them agreed to divide the said properties and terminate of land. The certificate cannot always be considered as conclusive evidence of
ownership. In fact, mere issuance of the certificate of title in the name of any person its approval by the [c]ourt after the parties have been accorded opportunity to be
does not foreclose the possibility that the real property may be under co-ownership heard thereon, and an award for the recovery by the party or parties thereto entitled of
with persons not named in the certificate, or that the registrant may only be a trustee, their just share in the rents and profits of the real estate in question.
or that other parties may have acquired interest over the property subsequent to the
issuance of the certificate of title. Needless to say, registration does not vest
ownership over a property, but may be the best evidence thereof.
A – as
A careful perusal of the contents of the so-called Partition Agreement indicates that
the document involves matters which necessitate prior settlement of questions of
law, basic of which is a determination as to whether the parties have the right to
freely divide among themselves the subject properties. Moreover, to follow
Lacbayan’s argument would be to allow Bayani not only to admit against his own
interest but that of his legal spouse as well, who may also be lawfully entitled co-
ownership over the said properties. Bayani is not allowed by law to waive whatever
share his lawful spouse may have on the disputed properties. Basic is the rule that
rights may be waived, unless the waiver is contrary to law, public order, public policy,
morals, good customs or prejudicial to a third person with a right recognized by law.

*in case ma’am asks, the Court defined the two phases of partition proceedings*

Our disquisition in Municipality of Biñan v. Garcia is definitive. There, we explained

The first phase of a partition and/or accounting suit is taken up with the
determination of whether or not a co-ownership in fact exists, and a partition is proper
(i.e., not otherwise legally proscribed) and may be made by voluntary agreement of all
the parties interested in the property. This phase may end with a declaration that
plaintiff is not entitled to have a partition either because a co-ownership does not
exist, or partition is legally prohibited. It may end, on the other hand, with an
adjudgment that a co-ownership does in truth exist, partition is proper in the premises
and an accounting of rents and profits received by the defendant from the real estate
in question is in order.

The second phase commences when it appears that "the parties are unable to agree
upon the partition" directed by the court. In that event[,] partition shall be done for the
parties by the [c]ourt with the assistance of not more than three (3) commissioners.
This second stage may well also deal with the rendition of the accounting itself and