Adoracion Cruz, Thelma Debbie E. Cruz and Gerry E.
Cruz v CA and
Spouses Eliseo and Virginia Malolos [Panganiban, 1998]
Relevant Part
On application of Art 1292: The MOA did not novate the DPP because it
does not express a clear intent to dissolve the old obligation as a
consideration for the emergence of a new one. Petitioners also fail to show
that the DPP and MOA are materially and substantially incompatible with
each other.
FACTS
When her husband, Delfin, died, Adoracion Cruz and her children, Thelma,
Nerissa, Arnel and Gerry Cruz executed a notarized Deed of Partial Partition
(DPP) which allowed each one of them to have a share of several parcels of
registered lands.
The next day, the same parties executed a Memorandum Agreement (MOA)
which stated that the “parties are common co-owners pro indiviso in equal
shares of the ff registered real properties, all situated in Taytay, Rizal
[introductory paragraph only] x x x That despite the execution of this DPP
and the eventual disposal or sale of their respective shared, the contracting
parties herein covenanted and agreed among themselves and by these
presents do hereby bind themselves to one another that they shall share
alike and receive equal shares from the proceeds of the sale of any lot or lots
allotted to and adjudicated in their individual named by virtue of the DPP x x
x"
The MOA was registered and annotated in the titles of the lands covered by
the DPP. The parties then registered the DPPs, subdivision plans and titles
under their names.
The 7 lands in question in this case belonged to Nerissa Cruz-Tamayo. Each
of the 7 titles had an annotation pertaining to the MOA.
Spouses Malolos filed a civil case against spouses Nerissa Cruz-Tamayo
and Nelson Tamayo for a sum of money [case did not mention why]. CFI of
Rizal rules in favor of the Maloloses. The Tamayos should pay them
P126,529.00 w 12% interest per annum and P5000 attorney’s fees. A writ of
execution was then issued.
The sheriff levied upon the 7 lands. The highest bidders were the Maloloses.
Sheriff executed a Deed of Sale. Nerissa failed to exercise her right of
redemption. She also refused to give to the Maloloses the owner’s duplicate
copy of the 7 titles of the lands. The couple then moved the court to compel
her and she still refused to comply. They then asked the court to declare the
titles null and void.
Nerissa’s mom and siblings (petitioners) then filed a motion to intervene
which was granted. They claimed they were co-owners of Nerissa’s
lands. [pursuant to the MOA daw so they also have a right to the 7 parcels of
land daw]
CFI then issued an order for the surrender of the owner’s duplicate copies so
they may be annotated for the rights and interests the Maloloses have
acquired. The petitioners filed a case for Partition of Real Estate against the
Maloloses.
CFI ruled in favor of the petitioners and ordered the partition of the 7
lands to be divided into 5 (4 members of Cruz family + 1 for the
Maloloses).
CA reversed CFI. DPP conferred ownership of the 7 lands to Nerissa. MOA
merely created an obligation for her to share with the petitioners the
proceeds of the sales of her lands.
ISSUES
[Important part] WON the DPP was cancelled or novated by the MOA - NO
Novation requires: (1) there is a previous valid obligation; (2) the parties
concerned agree to a new contract; (3) the old contract is extinguished; and
(4) there is a valid new contract. Also, according to Art 1292, in order an
obligation may be extinguished by another which substitutes the same, it
must be declared in unequivocal terms (express novation) or that the old and
new obligations be on every point incompatible with each other (implied
novation).
The MOA did not novate the DPP because it does not express a clear
intent to dissolve the old obligation as a consideration for the
emergence of a new one. Petitioners also fail to show that the DPP and
MOA are materially and substantially incompatible with each other.

The DPP granted title to the lots in question to the co-owner to whom they
were assigned and the MOA only created an obligation share the proceeds
of the sale of their respective properties. There is no incompatibility between
these two contracts.

WON MOA established co-ownership of the 7 lands - NO

MOA retains the partition of the properties. It vests in the registered owner the power
to dispose of the land adjudicated to him. In co-ownership, an undivided thing or right
belongs to 2 or more persons. The parcels of land in the MOA may be sold by their
respective owners without the consent of the other parties of the DPP.

WON petitioners are barred by estoppel from claiming co-ownership - YES because
of their own acts and representations, they have denied co-ownership. In their
transactions with others, they claimed that the other lands covered by the MOA are
absolutely owned.

WON res judicata has set in on co-ownership - NO because the RTC of QC case was
for the collection of money while the RTC of Antipolo case as for partition. There is no
concurrence of elements.

Petition denied and CA affirmed.