Scribd
Upload
72 views3 pages

Case No 7 Olaco VS Co Cho Chit

O Lay Kia bought a piece of land and had the title placed under her half-sister Emilia's name since O Lay Kia and her husband, as Chinese nationals, could not legally own property in the Philippines. Later, Emilia sold the land to the Church without informing O Lay Kia. When O Lay Kia discovered this, she sued Emilia to recover the purchase price. The court ruled that a resulting trust existed between the sisters since O Lay Kia paid for the land, making her the beneficial owner, and Emilia the legal trustee. The court also found that prescription had not set in, as Emilia had not clearly repudiated the trust and O Lay Kia filed suit promptly upon

Uploaded by

Japhet C. Villaruel
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
72 views3 pages

Case No 7 Olaco VS Co Cho Chit

O Lay Kia bought a piece of land and had the title placed under her half-sister Emilia's name since O Lay Kia and her husband, as Chinese nationals, could not legally own property in the Philippines. Later, Emilia sold the land to the Church without informing O Lay Kia. When O Lay Kia discovered this, she sued Emilia to recover the purchase price. The court ruled that a resulting trust existed between the sisters since O Lay Kia paid for the land, making her the beneficial owner, and Emilia the legal trustee. The court also found that prescription had not set in, as Emilia had not clearly repudiated the trust and O Lay Kia filed suit promptly upon

Uploaded by

Japhet C. Villaruel
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 3

CASE NO 7.

OLACO VS CO CHO CHIT

O’Laco vs. Co Cho Chit

F: A parcel of land was sold to Olaco. Cho chit learned that Olaco sold the land to
the Archbishop of Manila. Cho Chit and Lay Kia sued Olaco to recover the
purchase price of the land asserting that Olaco knew she was not the real vendee of
the property. Both also contended that Olaco breached the trust when she sold
thenlanf to Archbishop of Manila.

I: Whether a resulting trust was intended by them in the acquisition of the property.
YES

R: Implied trusts are those which, without being express, are deducible from the
nature of the transaction as matters of intent, or which are superinduced on the
transaction by operation of law as matters of equity, independently of the particular
intention of the parties. Implied trusts may either be resulting or constructive trusts,
both coming into being by operation of law.
Resulting trust- based on the equitable doctrine that valuable consideration
and not legal title determines equitable title or interest and are presumed always to
have been contemplated by the parties. They arise from the nature or circumstances
of the consideration involved in a transaction whereby one person thereby becomes
invested with legal title but is obligated in equity to hold his legal title for the
benefit of another.

Constructive trust – created by the construction of equity in order to satisfy


the demands of justice and prevent unjust enrichment. They arise contrary to
intentionagainst one who, by fraud, duress or abuse of confidence, obtains or holds
the legal right to property which he ought not, in equity and good conscience to
hold.

Implied trusts may be established by oral evidence. However, in order to establish


an implied trust in real property by parol evidence, the proof should be as fully
convincing as if the acts giving rise to the trust obligation were proven by an
authentic document. It cannot be established upon vague and conclusive proof.
**************
O'LACO VS. CO CHO CHIT 220 SCRA 656 (Dungog)
FACTS: O Lay Kia bought a piece of land and had it named under her half sister
Emilia since she and her husband, as a Chinese national and cannot own property
in the Philippines. Later on, Emilia sold the property to the Church without the
knowledge of her sister. When O Lay Kia found out, they immediately filed a case
for recovery of the purchase price of the land. Emilia asserts that she merely left
the certificate of title covering the property with O Lay Kia for safekeeping. The
latter insists that the title was in her possession because she and her husband
bought the property from their conjugal funds. The trial court declared that there
was no trust relation of any sort between the sisters. The Court of Appeals ruled
otherwise.
ISSUES:
1.Whether or not a resulting trust existed between the sisters?
2. Whether prescription has set
in? HELD:
1) Yes. Under Art. 1448 of the Civil Code, “there is an implied trust when property
is sold, and the legal estate is granted to one party but the price is paid by another
for the purpose of having the beneficial interest of the property. The former is the
trustee, while the latter is the beneficiary.” Resulting trusts are based on the
equitable doctrine that valuable consideration and not legal title determines the
equitable title or interest and are presumed always to have been contemplated by
the parties. They arise from the nature or circumstances of the consideration
involved in a transaction whereby one person thereby becomes invested with legal
title but is obligated in equity to hold his legal title for the benefit of another. In this
case, the court cited five instances that prove a trust relationship. First, the spouses
were in possession of all the pertinent documents of the sale from the beginning
until the end of the transaction. Second, there is a previous case of similar facts
involving O Lay Kia and her brother on a different parcel of land decided in her
favor. Third, the circumstances leading to Emilia acquiring a title to the land was
dubius. Fourth, until the sale to the church, Emilia recognized the trust by
promising to take care of the transfer to the actual owners as soon as she is able.
Lastly, Emilia had no source of income to show how it was possible for her to
purchase the land.
2) No. So long as the trustee recognizes the trust, the beneficiary may rely upon the
recognition, and ordinarily will not be in fault for omitting to bring an action to
enforce his rights. There is no running of the prescriptive period if the trustee
expressly recognizes the resulting trust. A resulting trust is repudiated if the
following requisites concur: (a) the trustee has performed unequivocal acts of
repudiation amounting to an ouster of the cestui qui trust; (b) such positive acts
of repudiation have been made
known to the cestui qui trust; and, (c) the evidence thereon is clear and
convincing. In this case, prescription did not begin to run until the sale
of the Oroquieta property. The spouses instituted the suit 2 moths after
acquiring knowledge of the sale for breach of trust. Laches cannot lie
against them. In Tale v. Court of Appeals, the Court categorically ruled
that an action for reconveyance based on an implied or constructive
trust must prescribes in ten (10) years.

You might also like

pFad - Phonifier reborn

Pfad - The Proxy pFad of © 2024 Garber Painting. All rights reserved.

Note: This service is not intended for secure transactions such as banking, social media, email, or purchasing. Use at your own risk. We assume no liability whatsoever for broken pages.


Alternative Proxies:

Alternative Proxy

pFad Proxy

pFad v3 Proxy

pFad v4 Proxy