SECOND DIVISION

[G.R. No. 165300. April 23, 2010.]

ATTY. PEDRO M. FERRER , petitioner, vs. SPOUSES ALFREDO

DIAZ and IMELDA DIAZ, REINA COMANDANTE and SPOUSES
BIENVENIDO PANGAN and ELIZABETH PANGAN, respondents.

DECISION

DEL CASTILLO, J : p

The basic questions to be resolved in this case are: Is a waiver of

hereditary rights in favor of another executed by a future heir while the
parents are still living valid? Is an adverse claim annotated on the title of a
property on the basis of such waiver likewise valid and effective as to bind
the subsequent owners and hold them liable to the claimant?
This Petition for Review on Certiorari 1 under Rule 45 of the Rules of
Court assails the December 12, 2003 Decision 2 of the Court of Appeals (CA)
in CA-G.R. CV No. 70888. 3 Said Decision modified the June 14, 2001
Summary Judgment 4 of the Regional Trial Court (RTC) of Quezon City in Civil
Case No. Q-99-38876 by holding respondents Spouses Bienvenido and
Elizabeth Pangan (the Pangans) not solidarily liable with the other
respondents, Spouses Alfredo and Imelda Diaz (the Diazes) and Reina
Comandante (Comandante), to petitioner Atty. Pedro M. Ferrer (Atty. Ferrer).
Likewise assailed is the CA Resolution 5 dated September 10, 2004 which
denied petitioner's as well as respondents Spouses Diaz and Comandante's
respective motions for reconsideration.
The parties' respective versions of the factual antecedents are as
follows:
Version of the Petitioner
Petitioner Atty. Ferrer claimed in his original Complaint 6 that on May 7,
1999, the Diazes, as represented by their daughter Comandante, through a
Special Power of Attorney (SPA), 7 obtained from him a loan of
P1,118,228.00. The loan was secured by a Real Estate Mortgage Contract 8
by way of second mortgage over Transfer Certificate of Title (TCT) No. RT-
6 6 0 4 9 and a Promissory Note 10 payable within six months or up to
November 7, 1999. Comandante also issued to petitioner postdated checks
to secure payment of said loan. cASTED

Petitioner further claimed that prior to this or on May 29, 1998,

Comandante, for a valuable consideration of P600,000.00, which amount
formed part of the abovementioned secured loan, executed in his favor an
instrument entitled Waiver of Hereditary Rights and Interests Over a Real
Property (Still Undivided), 11 the pertinent portions of which read:
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 I, REINA D. COMANDANTE, of legal age, Filipino, married, with
residence and postal address at No. 6, Road 20, Project 8, Quezon City,
Metro Manila, Philippines, for a valuable consideration of SIX HUNDRED
THOUSAND PESOS (P600,000.00) which constitutes my legal
obligation/loan to Pedro M. Ferrer, likewise of legal age, Filipino,
married to Erlinda B. Ferrer, with residence and postal address at No.
9, Lot 4, Puerto Rico Street, Loyola Grand Villas, Quezon City, Metro
Manila, Philippines, by virtue of these presents, do hereby WAIVE,
and/or REPUDIATE all my hereditary rights and interests as a legitimate
heir/daughter of Sps. Alfredo T. Diaz and Imelda G. Diaz in favor of said
Pedro M. Ferrer, his heirs and assigns over a certain parcel of land
together with all the improvements found thereon and which property
is more particularly described as follows:

TRANSFER CERTIFICATE OF TITLE

NO. RT-6604 (82020) PR-18887

xxx xxx xxx

and which property is titled and registered in the name of my parents

Alfredo T. Diaz and Imelda G. Diaz, as evidenced by Transfer Certificate
of Title No. RT 6604 (82020) PR-18887.

(sgd.)
REINA D. COMANDANTE
Affiant
On the basis of said waiver, petitioner executed an Affidavit of Adverse
Claim 12 which he caused to be annotated at the back of TCT No. RT-6604 on
May 26, 1999.
The Diazes, however, reneged on their obligation as the checks issued
by Comandante were dishonored upon presentment. Despite repeated
demands, said respondents still failed and refused to settle the loan. Thus,
petitioner filed on September 29, 1999 a Complaint 13 for Collection of Sum
of Money Secured by Real Estate Mortgage Contract against the Diazes and
Comandante docketed as Civil Case No. Q-99-38876 and raffled to Branch
224 of RTC, Quezon City.
Petitioner twice amended his complaint. First, by including as an
alternative relief the Judicial Foreclosure of Mortgage 14 and, second, by
impleading as additional defendants the Pangans as the mortgaged property
covered by TCT No. RT-6604 was already transferred under their names in
TCT No. N-209049. Petitioner prayed in his second amended complaint that
all the respondents be ordered to jointly and solidarity pay him the sum of
P1,118,228.00, exclusive of interests, and/or for the judicial foreclosure of
the property pursuant to the Real Estate Mortgage Contract. HCacDE

Version of the Respondents

In her Answer 15 to petitioner's original complaint, Comandante alleged
that petitioner and his wife were her fellow members in the Couples for
Christ Movement. Sometime in 1998, she sought the help of petitioner with
regard to the mortgage with a bank of her parents' lot located at No. 6, Rd.
20, Project 8, Quezon City and covered by TCT No. RT-6604. She also sought
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 financial accommodations from the couple on several occasions which
totaled P500,000.00. Comandante, however, claimed that these loans were
secured by chattel mortgages over her taxi units in addition to several
postdated checks she issued in favor of petitioner.
As she could not practically comply with her obligation, petitioner and
his wife, presented to Comandante sometime in May 1998 a document
denominated as Waiver of Hereditary Rights and Interests Over a Real
Property (Still Undivided) pertaining to a waiver of her hereditary share over
her parents' abovementioned property. Purportedly, the execution of said
waiver was to secure Comandante's loan with the couple which at that time
had already ballooned to P600,000.00 due to interests.
A year later, the couple again required Comandante to sign the
following documents: (1) a Real Estate Mortgage Contract over her parents'
property; and, (2) an undated Promissory Note, both corresponding to the
amount of P1,118,228.00, which petitioner claimed to be the total amount of
Comandante's monetary obligation to him exclusive of charges and
interests. Comandante alleged that she reminded petitioner that she was not
the registered owner of the subject property and that although her parents
granted her SPA, same only pertains to her authority to mortgage the
property to banks and other financial institutions and not to individuals.
Petitioner nonetheless assured Comandante that the SPA was also applicable
to their transaction. As Comandante was still hesitant, petitioner and his wife
threatened to foreclose the former's taxi units and present the postdated
checks she issued to the bank for payment. For fear of losing her taxi units
which were the only source of her livelihood, Comandante was thus
constrained to sign the mortgage agreement as well as the promissory note.
Petitioner, however, did not furnish her with copies of said documents on the
pretext that they still have to be notarized, but, as can be gleaned from the
records, the documents were never notarized. Moreover, Comandante
claimed that the SPA alluded to by petitioner in his complaint was not the
same SPA under which she thought she derived the authority to execute the
mortgage contract.
Comandante likewise alleged that on September 29, 1999 at 10:00
o'clock in the morning, she executed an Affidavit of Repudiation/Revocation
of Waiver of Hereditary Rights and Interests Over A (Still Undivided) Real
Property, 16 which she caused to be annotated on the title of the subject
property with the Registry of Deeds of Quezon City on the same day.
Interestingly, petitioner filed his complaint later that day too.
By way of special and affirmative defenses, Comandante asserted in
her Answer to the amended complaint 17 that said complaint states no cause
of action against her because the Real Estate Mortgage Contract and the
waiver referred to by petitioner in his complaint were not duly, knowingly
and validly executed by her; that the Waiver of Hereditary Rights and
Interests Over a Real Property (Still Undivided) is a useless document as its
execution is prohibited by Article 1347 of the Civil Code, 18 hence, it cannot
be the source of any right or obligation in petitioner's favor; that the Real
Estate Mortgage was of doubtful validity as she executed the same without
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 valid authority from her parents; and, that the prayer for collection and/or
judicial foreclosure was irregular as petitioner cannot seek said remedies at
the same time.
Apart from executing the affidavit of repudiation, Comandante also
filed on October 4, 1999 a Petition for Cancellation of Adverse Claim (P.E.
2468) Under the Memorandum of Encumbrances of TCT No. RT-6604
(82020) PR-18887 19 docketed as LRC Case No. Q-12009 (99) and raffled to
Branch 220 of RTC, Quezon City. Petitioner who was impleaded as
respondent therein moved for the consolidation of said case 20 with Civil
Case No. Q-99-38876. On June 24, 2000, Branch 220 of RTC, Quezon City
ordered the consolidation of LRC Case No, Q-12009 (99) with Civil Case No.
Q-99-38876. Accordingly, the records of the former case was forwarded to
Branch 224. AHcCDI

For their part, the Diazes asserted that petitioner has no cause of
action against them. They claimed that they do not even know petitioner and
that they did not execute any SPA in favor of Comandante authorizing her to
mortgage for the second time the subject property. They also contested the
due execution of the SPA as it was neither authenticated before the
Philippine Consulate in the United States nor notarized before a notary public
in the State of New York where the Diazes have been residing for 16 years.
They claimed that they do not owe petitioner anything. The Diazes also
pointed out that the complaint merely refers to Comandante's personal
obligation to petitioner with which they had nothing to do. They thus prayed
that the complaint against them be dismissed. 21
At the Pangans' end, they alleged that they acquired the subject
property by purchase in good faith and for a consideration of P3,000,000.00
on November 11, 1999 from the Diazes through the latter's daughter
Comandante who was clothed with SPA acknowledged before the Consul of
New York. The Pangans immediately took actual possession of the property
without anyone complaining or protesting. Soon thereafter, they were issued
TCT No. N-209049 in lieu of TCT No. RT-6604 which was cancelled. 22
However, on December 21, 1999, they were surprised upon being
informed by petitioner that the subject land had been mortgaged to him by
the Diazes. Upon inquiry from Comandante, the latter readily admitted that
she has a personal loan with petitioner for which the mortgage of the
property in petitioner's favor was executed. She admitted, though, that her
parents were not aware of such mortgage and that they did not authorize
her to enter into such contract. Comandante also informed the Pangans that
the signatures of her parents appearing on the SPA are fictitious and that it
was petitioner who prepared such document.
As affirmative defense, the Pangans asserted that the annotation of
petitioner's adverse claim on TCT No. RT-6604 cannot impair their rights as
new owners of the subject property. They claimed that the Waiver of
Hereditary Rights and Interests Over a Real Property (Still Undivided) upon
which petitioner's adverse claim is anchored cannot be the source of any
right or interest over the property considering that it is null and void under
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 paragraph 2 of Article 1347 of the Civil Code.
Moreover, the Pangans asserted that the Real Estate Mortgage
Contract cannot bind them nor in any way impair their ownership of subject
property because it was not registered before the Register of Deeds. 23
All the respondents interposed their respective counterclaims and
prayed for moral and exemplary damages and attorney's fees in varying
amounts.
After the parties have submitted their respective pre-trial briefs, the
Diazes filed on March 29, 2001 a Motion for Summary Judgment 24 alleging
that: first, since the documents alluded to by petitioner in his complaint were
defective, he was not entitled to any legal right or relief; and, second, it was
clear from the pleadings that it is Comandante who has an outstanding
obligation with petitioner which the latter never denied. With these, the
Diazes believed that there is no genuine issue as to any material fact against
them and, hence, they were entitled to summary judgment. ETIcHa

On May 7, 2001, petitioner also filed a Motion for Summary Judgment,

25 claiming that his suit against the respondents is meritorious and well-

founded and that same is documented and supported by law and

jurisprudence. He averred that his adverse claim annotated at the back of
TCT No. RT-6604, which was carried over in TCT No. 209049 under the
names of the Pangans, is not merely anchored on the Waiver of Hereditary
Rights and Interests Over a Real Property (Still Undivided) executed by
Comandante, but also on the Real Estate Mortgage likewise executed by her
in representation of her parents and in favor of petitioner. Petitioner insisted
that said adverse claim is not frivolous and invalid and is registrable under
Section 70 of Presidential Decree (PD) No. 1529. In fact, the Registrar of
Deeds of Quezon City had already determined the sufficiency and/or validity
of such registration by annotating said claim, and this, respondents failed to
question. Petitioner further averred that even before the sale and transfer to
the Pangans of the subject property, the latter were already aware of the
existence of his adverse claim. In view of these, petitioner prayed that his
Motion for Summary Judgment be granted.
Ruling of the Regional Trial Court
After the filing of the parties' respective Oppositions to the said
motions for summary judgment, the trial court, in an Order dated May 31,
2 0 0 1 , 26 deemed both motions for summary judgment submitted for
resolution. Quoting substantially petitioner's allegations in his Motion for
Summary Judgment, it thereafter rendered on June 14, 2001 a Summary
Judgment 27 in favor of petitioner, the dispositive portion of which reads:
WHEREFORE, premises considered, summary judgment is hereby
rendered in favor of plaintiff and against defendants by:
a) ORDERING all defendants jointly and solidarily to pay
plaintiff the sum of ONE MILLION ONE HUNDRED EIGHTEEN THOUSAND
TWO HUNDRED TWENTY EIGHT PESOS (P1,118,228.00) which is blood
money of plaintiff;
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 b) ORDERING the Honorable Registrar of Deeds of Quezon
City that the rights and interest of the plaintiff over subject property be
annotated at the back of T.C.T. No. N-209049;
c) SENTENCING all defendants to pay plaintiff's expenses of
TEN THOUSAND PESOS (P10,000.00) and to pay the costs of suit.
IT IS SO ORDERED. 28

The Pangans, the Diazes, and Comandante appealed to the CA. 29 The
Pangans faulted the trial court in holding their jointly and severally liable
with the Diazes and Comandante for the satisfaction of the latter's personal
obligation to petitioner in the total amount of P1,118,228.00. The Diazes and
Comandante, on the other hand, imputed error upon the trial court in
rendering summary judgment in favor of petitioner. They averred that
assuming the summary judgment was proper, the trial court should not have
considered the Real Estate Mortgage Contract and the Promissory Note as
they were defective, as well as petitioner's frivolous and non-registrable
adverse claim. ETDaIC

In its Decision 30 dated December 12, 2003, the CA declared

Comandante's waiver of hereditary rights null and void. However, it found
the Real Estate Mortgage executed by Comandante on behalf of her parents
as binding between the parties thereto.
As regards the Pangans, the CA ruled that the mortgage contract was
not binding upon them as they were purchasers in good faith and for value.
The property was free from the mortgage encumbrance of petitioner when
they acquired it as they only came to know of the adverse claim through
petitioner's phone call which came right after the former's acquisition of the
property. The CA further ruled that as Comandante's waiver of hereditary
rights and interests upon which petitioner's adverse claim was based is a
nullity, it could not be a source of any right in his favor. Hence, the Pangans
were not bound to take notice of such claim and are thus not liable to
petitioner.
Noticeably, the appellate court did not rule on the propriety of the
issuance of the Summary Judgment as raised by the Diazes and
Comandante. In the ultimate, the CA merely modified the assailed Summary
Judgment of the trial court by excluding the Pangans among those solidarily
liable to petitioner, in effect affirming in all other respects the assailed
summary judgment, viz.:
WHEREFORE, foregoing premises considered, the Decision of the
Regional Trial Court of Quezon City, Branch 224 in Civil Case No. Q-99-
38876 is hereby MODIFIED, as follows:
1. Ordering defendants-appellants Comandante and Spouses
Diaz to jointly and severally pay plaintiff the sum of Php1,118,228.00;
and
2. Ordering defendants-appellants Comandante and Spouses
Diaz to jointly and severally pay plaintiff the amount of Php10,000.00
plus cost of suit.
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 SO ORDERED. 31

Petitioner's Motion for Reconsideration 32 having been denied by the

CA in its Resolution 33 dated September 10, 2004, he now comes to us
through this petition for review on certiorari insisting that the Pangans
should, together with the other respondents, be held solidarily liable to him
for the amount of P1,118,228.00.
Our Ruling
The petition lacks merit.
Petitioner merely reiterates his contentions in the Motion for Summary
Judgment he filed before the trial court. He insists that his Adverse Claim
annotated at the back of TCT No. RT-6604 is not merely anchored on
Comandante's Waiver of Hereditary Rights and Interests Over A Real
Property (Still Undivided) but also on her being the attorney-in-fact of the
Diazes when she executed the mortgage contract in favor of petitioner. He
avers that his adverse claim is not frivolous or invalid and is registrable as
the Registrar of Deeds of Quezon City even allowed its annotation. He also
claims that even prior to the sale of subject property to the Pangans, the
latter already knew of his valid and existing adverse claim thereon and are,
therefore, not purchasers in good faith. Thus, petitioner maintains that the
Pangans should be held, together with the Diazes and Comandante, jointly
and severally liable to him in the total amount of P1,118,228.00. CAaSHI

Petitioner's contentions are untenable.

The Affidavit of Adverse Claim executed by petitioner reads in part:

xxx xxx xxx
1. That I am the Recipient/Benefactor of compulsory
heir's share over an undivided certain parcel of land together
with all the improvements found therein . . . as evidenced by
Waiver of Hereditary Rights and Interests Over A Real
Property, executed by REINA D. COMANDANTE (a
compulsory/legitimate heir of Sps. Alfredo T. Diaz and Imelda
G. Diaz), . . . .
2. That in order to protect my interest over said
property as a Recipient/Benefactor, for the registered
owners/parents might dispose (of) and/or encumber the same in a
fraudulent manner without my knowledge and consent, for the owner's
duplicate title was not surrendered to me, it is petitioned that this
Affidavit of Adverse Claim be ANNOTATED at the back of the said title
particularly on the original copy of Transfer Certificate of Title No. RT-
6604 (82020) PR-18887 which is on file with the Register of Deeds of
Quezon City.

3. That I am executing this Affidavit in order to attest (to) the

truth of the foregoing facts and to petition the Honorable Registrar of
Deeds, Quezon City, to annotate this Affidavit of Adverse Claim at the
back of the said title particularly the original copy of Transfer
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 Certificate of Title No. RT-6604 (82020) PR-18887 which is on file with
the said office, so that my interest as Recipient/Benefactor of
the said property will be protected especially the registered
owner/parents, in a fraudulent manner might dispose (of) and/or
encumber the same without my knowledge and consent. (Emphasis
ours)

Clearly, petitioner's Affidavit of Adverse Claim was based solely on the

waiver of hereditary interest executed by Comandante. This fact cannot be
any clearer especially so when the inscription of his adverse claim at the
back of TCT No. RT-6604 reads as follows:
P.E. 2468/T-(82020)RT-6604 — AFFIDAVIT OF ADVERSE CLAIM —
Executed under oath by PEDRO M. FERRER, married to Erlinda B.
Ferrer, claiming among others that they have a claim, the
interest over said property as Recipient/Benefactor, by virtue
of a waiver of Hereditary Rights and Interest over a real
property . . . 34 (Emphasis ours)
Therefore, there is no basis for petitioner's assertion that the adverse
claim was also anchored on the mortgage contract allegedly executed by
Comandante on behalf of her parents.
The questions next to be resolved are: Is Comandante's waiver of
hereditary rights valid? Is petitioner's adverse claim based on such waiver
likewise valid and effective?
We note at the outset that the validity of petitioner's adverse claim
should have been determined by the trial court after the petition for
cancellation of petitioner's adverse claim filed by Comandante was
consolidated with Civil Case No. Q-99-38876. 35 This is in consonance with
Section 70 of PD 1529 which provides: EAcHCI

Section 70. Adverse Claim. — Whoever claims any part or

interest in registered land adverse to the registered owner, arising
subsequent to the date of the original registration, may, if no other
provision is made in this Decree for registering the same, make a
statement in writing setting forth fully his alleged right or interest, and
how or under whom acquired, a reference to the number of the
certificate of title of the registered owner, the name of the registered
owner, and a description of the land in which the right or interest is
claimed.
The statement shall be signed and sworn to, and shall state the
adverse claimant's residence, and a place at which all notices may be
served upon him. This statement shall be entitled to registration as an
adverse claim on the certificate of title. The adverse claim shall be
effective for a period of thirty days from the date of registration. After
the lapse of said period, the annotation of adverse claim may be
cancelled upon filing of a verified petition therefor by the party
in interest: Provided, however, That after cancellation, no second
adverse claim based on the same ground shall be registered by the
same claimant.
Before the lapse of thirty days aforesaid, any party in interest
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 may file a petition in the Court of First Instance where the land
is situated for the cancellation of the adverse claim, and the
court shall grant a speedy hearing upon the question of
validity of such adverse claim, and shall render judgment as
may be just and equitable. If the adverse claim is adjudged to
be invalid, the registration thereof shall be ordered cancelled.
If, in any case, the court, after notice and hearing, shall find that the
adverse claim thus registered was frivolous, it may fine the claimant in
an amount not less than one thousand pesos nor more than five
thousand pesos, in its discretion. Before the lapse of thirty days, the
claimant may withdraw his adverse claim by filing with the Register of
Deeds a sworn petition to that effect. (Emphasis ours)

Pursuant to the third paragraph of the afore-quoted provision, it has

been held that the validity or efficaciousness of an adverse claim may only
be determined by the Court upon petition by an interested party, in which
event, the Court shall order the immediate hearing thereof and make the
proper adjudication as justice and equity may warrant. And, it is only when
such claim is found unmeritorious that the registration of the adverse claim
may be cancelled. 36
As correctly pointed out by respondents, the records is bereft of any
showing that the trial court conducted any hearing on the matter. Instead,
what the trial court did was to include this material issue among those for
which it has rendered its summary judgment as shown by the following
portion of the judgment:
. . . it will be NOTED that subject Adverse Claim annotated at the back
of Transfer Certificate of Title No. RT-6604 (82020) PR-18887, and
carried over to defendants-Sps. Pangan's Title No. N-20909, is not
merely anchored on defendant Reina Comandante's "Waiver of
Hereditary Rights and Interest Over a Real Property" but also on her
being the Attorney-In-Fact of the previous registered
owners/parents/defendants Sps. Alfredo and Imelda Diaz about the
Real Estate Mortgage Contract for a loan of P1,118,228.00 which is a
blood money of the plaintiff. Moreover, subject Adverse Claim in
LRC Case No. Q-12009 (99) is NOT frivolous and invalid and
consequently, REGISTRABLE by virtue of Section 110 of the
Land Registration Act (now Section 70 of Presidential Decree
No. 1529). 37 (Emphasis ours) cTIESa

It does not escape out attention that the trial court merely echoed the
claim of petitioner that his adverse claim subject of LRC Case No. Q-12009
(99) is not frivolous, invalid and is consequently registrable. We likewise
lament the apparent lack of effort on the part of said court to make even a
short ratiocination as to how it came up with said conclusion. In fact, what
followed the above-quoted portion of the summary judgment are mere
recitals of the arguments raised by petitioner in his motion for summary
judgment. And in the dispositive portion, the trial court merely casually
ordered that petitioner's adverse claim be inscribed at the back of the title of
the Pangans. What is worse is that despite this glaring defect, the CA
manifestly overlooked the matter even if respondents vigorously raised the
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 same before it.
Be that as it may, respondents' efforts of pointing out this flaw, which
we find significant, have not gone to naught as will be hereinafter discussed.
All the respondents contend that the Waiver of Hereditary Rights and
Interest Over a Real Property (Still Undivided) executed by Comandante is
null and void for being violative of Article 1347 of the Civil Code, hence,
petitioner's adverse claim which was based upon such waiver is likewise void
and cannot confer upon the latter any right or interest over the property.
We agree with the respondents.
Pursuant to the second paragraph of Article 1347 of the Civil Code, no
contract may be entered into upon a future inheritance except in cases
expressly authorized by law. For the inheritance to be considered "future",
the succession must not have been opened at the time of the contract. A
contract may be classified as a contract upon future inheritance, prohibited
under the second paragraph of Article 1347, where the following requisites
concur:
(1) That the succession has not yet been opened;
(2) That the object of the contract forms part of the inheritance;
and,
(3) That the promissor has, with respect to the object, an
expectancy of a right which is purely hereditary in nature. 38

In this case, there is no question that at the time of execution of

Comandante's Waiver of Hereditary Rights and Interest Over a Real Property
(Still Undivided), succession to either of her parent's properties has not yet
been opened since both of them are still living. With respect to the other two
requisites, both are likewise present considering that the property subject
matter of Comandante's waiver concededly forms part of the properties that
she expect to inherit from her parents upon their death and, such
expectancy of a right, as shown by the facts, is undoubtedly purely
hereditary in nature.
From the foregoing, it is clear that Comandante and petitioner entered
into a contract involving the former's future inheritance as embodied in the
Waiver of Hereditary Rights and Interest Over a Real Property (Still
Undivided) executed by her in petitioner's favor.
I n Tañedo v. Court of Appeals, 39 we invalidated the contract of sale
between Lazaro Tañedo and therein private respondents since the subject
matter thereof was a "one hectare of whatever share the former shall have
over Lot 191 of the cadastral survey of Gerona, Province of Tarlac and
covered by Title T-13829 of the Register of Deeds of Tarlac." It constitutes a
part of Tañedo's future inheritance from his parents, which cannot be the
source of any right nor the creator of any obligation between the parties. HEcTAI

Guided by the above discussions, we similarly declare in this case that

the Waiver of Hereditary Rights and Interest Over a Real Property (Still
Undivided) executed by Comandante in favor of petitioner as not valid and
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 that same cannot be the source of any right or create any obligation
between them for being violative of the second paragraph of Article 1347 of
the Civil Code.
Anent the validity and effectivity of petitioner's adverse claim, it is
provided in Section 70 of PD 1529, that it is necessary that the claimant has
a right or interest in the registered land adverse to the registered owner and
that it must arise subsequent to registration. Here, as no right or interest on
the subject property flows from Comandante's invalid waiver of hereditary
rights upon petitioner, the latter is thus not entitled to the registration of his
adverse claim. Therefore, petitioner's adverse claim is without any basis and
must consequently be adjudged invalid and ineffective and perforce be
cancelled.
Albeit we have already resolved the issues raised by petitioner, we
shall not stop here as the Diazes and Comandante in their Comment 40 call
our attention to the failure of the CA to pass upon the issue of the propriety
of the issuance by the trial court of the Summary Judgment in favor of
petitioner despite the fact that they have raised this issue before the
appellate court. They argue that summary judgment is proper only when
there is clearly no genuine issue as to any material fact in the action. Thus,
where the defendant presented defenses tendering factual issue which call
for presentation of evidence, as when he specifically denies the material
allegations in the complaint, summary judgment cannot be rendered.
The Diazes and Comandante then enumerate the genuine issues in the
case which they claim should have precluded the trial court from issuing a
summary judgment in petitioner's favor. First, the execution of the SPA in
favor of Comandante referred to by petitioner in his complaint was never
admitted by the Diazes. They assert that as such fact is disputed, trial
should have been conducted to determine the truth of the matter, same
being a genuine issue. Despite this, the trial court merely took the word of
the plaintiff and assumed that said document was indeed executed by them.
Second, although Comandante acknowledges that she has a personal
obligation with petitioner, she nevertheless, did not admit that it was in the
amount of P1,118,228.00. Instead, she claims only the amount of
P500,000.00 or P600,000.00 (if inclusive of interest) as her obligation.
Moreover, the Diazes deny borrowing any money from petitioner and neither
did the Pangans owe him a single centavo. Thus, the true amount of the
obligation due the petitioner and how each of the respondents are
responsible for such amount are genuine issues which need formal
presentation of evidence. Lastly, they aver that the trial court ignored
factual and material issues such as the lack of probative value of
Comandante's waiver of hereditary rights as well as of the SPA; the fact that
Comandante signed the mortgage contract and promissory note in her
personal capacity; and, that all such documents were prepared by petitioner
who acted as a lawyer and the creditor of Comandante at the same time.
Rule 35 of the Rules of Court provides for summary judgment, the
pertinent provisions of which are the following: HSDaTC

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 Section 1. Summary Judgment for claimant. — A party
seeking to recover upon a claim, counterclaim, or cross-claim or to
obtain a declaratory relief may, at any time after the pleading in
answer thereto has been served, move with supporting affidavits,
depositions or admissions for a summary judgment in his favor upon all
or any part thereof.

Section 2. Summary Judgment for the defending party. — A

party against whom a claim, counterclaim or cross-claim is asserted or
a declaratory relief is sought may, at any time, move with supporting
affidavits, depositions or admissions for a summary judgment in his
favor as to all or any part thereof.
Section 3. Motion and proceedings thereon. — The motion
shall be served at least ten (10) days before the time specified for the
hearing. The adverse party may serve opposing affidavits, depositions,
or admissions at least three (3) days before the hearing. After the
hearing, the judgment sought shall be rendered forthwith if the
pleadings, supporting affidavits, depositions and admissions on file,
show that, except as to the amount of damages, there is no genuine
issue as to any material fact and that the moving party is entitled to a
judgment as a matter of law.

As can be deduced from the above provisions, summary judgment is a

procedural devise resorted to in order to avoid long drawn out litigation and
useless delays. When the pleadings on file show that there are no genuine
issues of facts to be tried, the Rules of Court allows a party to obtain
immediate relief by way of summary judgment. That is, when the facts are
not in dispute, the court is allowed to decide the case summarily by applying
the law to the material facts. Conversely, where the pleadings tender a
genuine issue, summary judgment is not proper. A genuine issue is such fact
which requires the presentation of evidence as distinguished from a sham,
fictitious, contrived or false claim. 41
Here, we find the existence of genuine issues which removes the case
from the coverage of summary judgment. The variance in the allegations of
the parties in their pleadings is evident.
Petitioner anchors his complaint for sum of money and/or judicial
foreclosure on the alleged real estate mortgage over the subject property
allegedly entered into by Comandante in behalf of her parents to secure
payment of a loan amounting to P1,118,228.00. To support this claim,
petitioner attached to his complaint (1) the SPA alleged to have been
executed by the Diazes; (2) the Real Estate Mortgage Contract pertaining to
the amount of P1,118,228.00; and, (3) a Promissory Note.
Comandante, in her Answer to petitioner's Amended Complaint,
assailed the validity and due execution of the abovementioned documents.
She asserted that the same were not duly, knowingly and validly executed
by her and that it was petitioner who prepared all of them. Also, although
she admitted owing petitioner, same was not an absolute admission as she
limited herself to an obligation amounting only to P600,000.00 inclusive of
charges and interests. She likewise claimed that such obligation is her
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 personal obligation and not of her parents.
The Diazes, for their part, also denied that they executed the SPA
authorizing their daughter to mortgage their property to petitioner as well as
having any obligation to the latter. ATcaID

Clearly, there are genuine issues in this case which require the
presentation of evidence. For one, it is necessary to ascertain in a full blown
trial the validity and due execution of the SPA, the Real Estate Mortgage and
the Promissory Notes because the determination of the following equally
significant questions depends on them, to wit: (1) Are the Diazes obligated to
petitioner or is the obligation a purely personal obligation of Comandante?
and, (2) Is the sum of P1,118,228.00 as shown in the Real Estate Mortgage
and the Promissory Note, the amount which is really due the petitioner?
To stress, trial courts have limited authority to render summary
judgments and may do so only when there is clearly no genuine issue as to
any material fact. When the facts as pleaded by the parties are disputed or
contested, proceedings for summary judgment cannot take the place of trial.
42 From the foregoing, it is apparent that the trial court should have

refrained from issuing the summary judgment but instead proceeded to

conduct a full blown trial of the case. In view of this, the present case should
be remanded to the trial court for further proceedings and proper disposition
according to the rudiments of a regular trial on the merits and not through
an abbreviated termination of the case by summary judgment.
WHEREFORE, the petition is DENIED. The assailed Decision of the
Court of Appeals dated December 12, 2003 insofar as it excluded the
respondents Spouses Bienvenido Pangan and Elizabeth Pangan from among
those solidarily liable to petitioner Atty. Pedro M. Ferrer, is AFFIRMED. The
inscription of the adverse claim of petitioner Atty. Pedro M. Ferrer on T.C.T.
No. N-209049 is hereby ordered CANCELLED. Insofar as its other aspects
are concerned, the assailed Decision is SET ASIDE and VACATED. The case
i s REMANDED to the Regional Trial Court of Quezon City, Branch 224 for
further proceedings in accordance with this Decision.
SO ORDERED.

Carpio, Brion, Abad and Perez, JJ., concur.

Footnotes

1.Rollo, pp. 13-14.

2.CA rollo, pp. 140-149; penned by Associate Justice Arsenio J. Magpale and
concurred in by Associate Justices Conrado M. Vasquez, Jr. and Bienvenido L.
Reyes.

3.Entitled "Atty. Pedro M. Ferrer, plaintiff-appellee, vs. Spouses Alfredo Diaz and
Imelda Diaz, Reina Commandante and Spouses Bienvenido Pangan and
Elizabeth Pangan".
4.Records, pp. 287-291; penned by Judge Emilio L. Leachon, Jr.
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 5.CA rollo, p. 91.

6.Records, pp. 3-6.

7.Id. at 7.

8.Id. at 14-17.
9.Id. at 92-95.

10.Id. at 18.

11.Id. at 19-20.
12.Id. at 21.

13.Id. at 3-6.
14.Id. at 48-51 and 69-72.

15.Id. at 29-33.

16.Id. at 38.
17.Id. at 208-219.

18.ART. 1347. All things which are not outside the commerce of men, including
future things, may be the object of a contract. All rights which are not
intransmissible may also be the object of contracts.
No contract may be entered into upon future inheritance except in cases
expressly authorized by law.

All services which are not contrary to law, morals, good customs, public order
or public policy may likewise be the object of a contract.
19.Records, p. 1.

20.Id. at 93.
21.See Answer with Compulsory Counter-Claim of the Diazes, id. at 231-237.

22.See Answer with Compulsory Counter-Claim of the Pangans, id. at 172-183.

23.Id.
24.Id. at 246-257.

25.Id. at 262-268.
26.Id. at 286.

27.Id. at 287-291.

28.Id. at 290-291.
29.Id. at 295 and 301.

30.CA rollo, pp. 140-149.

31.Id. at 148.

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 32.Id. 166-170.

33.Id. at 191.

34.Dorsal side of p. 13 of the Records.

35.Records, p. 66.

36.Sajonas v. Court of Appeals, 327 Phil. 689, 712 (1996).

37.Records, p. 290.

38.J.L.T. Agro, Inc. v. Balansag, 493 Phil. 365, 378-379 (2005).

39.322 Phil. 84 (1996).

40.Rollo, pp. 192-210.

41.D.M. Consunji, Inc. v. Duvas Corporation, G.R. No. 155174, August 4, 2009.
42.Id.

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