Ada v Baylon

G.R No. 182435, Aug. 13, 2012

Facts:
Florentino and Maximina Baylon died in 1961 and 1974, respectively. They were
survived by their children Rita, Victoria, Dolores, Panfila, Ramon, and Lilia. Victoria died
in 1981, survived by a daughter, Luz Adanza, one of the petitioners. Ramon, on the
other hand, was survived by respondent Florante Baylon when he died in 1989.
The petitioners allege that Florentino and Maximina Baylon owned 43 parcels of land in
their lifetime and that Rita took possession of the said parcels of land, appropriating for
herself the income from the same. They further allege that Rita used the income to buy
two parcels of land. Because of this, the petitioners wanted to include those two parcels
of land in the partition by filing a civil case.
During the pendency of the case, Rita executed a Deed of Donation dated July 6, 1997,
in favor of her nephew Florante Baylon. The petitioners now seek to rescind the Deed of
Donation.
Issue:
Should rescission be granted?
Decision/Ruling:
Yes. Pursuant to Article 1381 (4) of the Civil Code, contracts which “refer to things
under litigation, if they have been entered into by the defendant without the knowledge
and approval of the litigants or of competent judicial authority, are rescissible.” The
rescission of such a contract requires the concurrence of the following:
1. The defendant, during the pendency of the case, enters into a contract
which refers to the thing subject of litigation
2. The said contract was entered into without the knowledge and approval
of the litigants or of a competent judicial authority
The purpose of Article 1381 (4) is to secure the possible effectivity of the impending
judgment by a court with respect to the thing subject of litigation. The rescission not
preconditioned upon the judicial determination as to the ownership of the thing subject
of litigation. Rita’s failure to inform and seek the approval of the petitioners or the RTC
regarding the conveyance gave the petitioners the right to rescind the said donation.