Dear PAO,

My parents bought a certain land, but the title was transferred to my brother Jeff. We are all living in the house built on said property. When my brother died, his heirs claimed ownership over the property, arguing that their father was the owner as reflected in the Torrens Title. My mother reminded them that their father has no financial capacity to purchase the land. Who is the real owner of said property? Can my parents present proof that my brother is not its real owner?

Amper

Dear Amper,

Property bought by parents and registered in the name of their child is considered a gift. This is exactly governed by Article 1448 of the New Civil Code of the Philippines, which provides that:

“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. However, if the person to whom the title is conveyed is a child, legitimate or illegitimate, of the one paying the price of the sale, no trust is implied by law, it being disputably presumed that there is a gift in favor of the child.”

The aforecited provision of law is also called purchase money resulting trust and the same was expounded in the case entitled, “Heirs of Roxas vs. Heirs of Roxas” (GR 254452, Nov. 27, 2024), where the Supreme Court, speaking through Associate Justice Alfredo Benjamin Caguioa, stated that:

“The implied trust under Article 1448 is called a purchase money resulting trust, which has the following elements: (a) an actual payment of money, property or services, or an equivalent, constituting valuable consideration; and (b) such consideration must be furnished by the alleged beneficiary of a resulting trust. The party alleging the existence of the trust bears the burden of proving it.

“Notably, the last sentence of Article 1448 states that if the title is conveyed to a child of the one paying the price of the sale, the disputable presumption is that there is a gift in favor of the child. There being no question that Ferdinand is the child of Melania, and that Melania paid the purchase price for the subject lot, there is a disputable presumption that Melania intended to donate the subject lot to Ferdinand.

“Being a disputable presumption, it may be overturned by contrary evidence. In Tong v. Go Tiat Kun, the Court held that the presumption was overturned because of several factors. First, the child under whose name the property was titled did not prove that he had the means to pay for it. Second, the parent and his other children always had possession of the property. Third, the property remained undivided even though it was registered in the name of one child. The surviving heirs of the child under whose name it was titled only claimed ownership after the death of said child. Fourth, the surviving heirs of the child admitted that their predecessor-in-interest did not send any letter claiming ownership over the property and that they had their own residence. Finally, the parent paid the real property taxes.” (Emphasis ours)

Applying the above-quoted jurisprudence to your situation, there is a disputable presumption that the land was given as a gift by your parents to your brother, Jeff. However, this presumption may be overturned by contrary evidence. Using the above-cited jurisprudence as a guide, your parents may do this by showing that: first, Jeff has no financial ability to purchase the property; second, you and your parents remained in possession of the land; and third, Jeff was the registered owner but he never divided the property or exercised ownership over the same and his heirs only claimed ownership after his death. If favored by the court, your parents are still the lawful owners of said property, and the transaction they entered with Jeff is merely a purchase money resulting trust.

We hope that we were able to answer your queries. This advice was based solely on the facts you have narrated and our appreciation of the same. Our opinion may vary when other facts are changed or elaborated.

We appreciate your trust and support.

Editor’s note: Dear PAO is a daily column of the Public Attorney’s Office. Questions for Chief Acosta may be sent to [email protected]