Philip Matthews VS Benjamin Taylor and Joselyn Taylor

GR 164584 June 22, 2009

FACTS
Benjamin Taylor, British subject, married Joselyn Taylor, a 17 year old Filipina on June 1988.
Thereafter, Joselyn bought a lot in Boracay Island for $129 000. The sale was allegedly financed
by Benjamin and the improvements thereon. Property was eventually converted to a resort
known as Admiral Ben Bow Inn.
However, the spouses had a falling out and Joselyn ran away to a certain Kim Philippsen.
Thereafter, Joselyn executed a Special Power of Attorney in favor of Benjamin, authorizing the
latter to enter into a contract with third parties with respect to the Boracay property.
Not known to her husband, Joselyn as lessor and petitioner therein, Philip Matthews as lessee,
entered into a Lease Agreement which involved the Boracay property for a period of 25 years
with an annual rental of P12 000. Such agreement was signed by the parties and executed before
a Notary Public. Petitioner thereafter took possession of the property and renamed the resort to
Music Garden Resort.
Claiming the agreement entered into by his wife was null and void, Benjamin filed an action for
Declaration of Nullity of the said agreement with damages against Joselyn and petitioner saying
that his funds were used in the acquisition of the property and he did not give his consent to the
said agreement.
No answer was filed, hence RTC declared Joselyn and petitioner in default declaring the
agreement null and void. However, the decision was set aside by CA and ordered RTC to allow
the involved parties to file an answer and conduct further proceedings.
Petitioner herein claimed good faith in transacting with Joselyn as the latter appeared to be the
owner of the involved property, thus, he found it unnecessary to obtain consent with Benjamin.
Moreover, it was found on the Lease Agreement Benjamin's signature as witness implying his
conformity to the agreement entered into by his wife.
RTC held that the said agreement was null and void and that the property involved is considered
as community property of the spouses thus the consent of both the spouses are necessary.
Although it was evidenced that Benjamin's signature was on the agreement, the trial court
refused to consider the alleged participation of the Benjamin primarily because his signature
appeared only on the last page of the document and not on every page thereof.
Petitioner filed a futile effort to appeal as RTC's decision was only affirmed by the CA adding
that the Special Power of Attorney executed by Joselyn in favor of her husband yielded an
inevitable conclusion that it was unnecessary for Jocelyn to participate in the agreement hence,
Benjamin's consent is required.
Hence this petition.
ISSUE
WON the Lease Agreement entered into by petitioner and Joselyn, without the consent of latter's
husband is null and void in accordance with the laws on property relations of the spouses

HELD
Petitioner contended that Benjamin's consent is not required attested by his signature on the
document as witness and that the property involved is an exclusive property of Jocelyn as the
Filipina spouse in light of Cheesman VS IAC case. Moreover, that th e lower courts erred in
applying the Family Code as the law governing the property regime of the spouses because their
marriage was celebrated prior the effectivity of the Family Code, thus it has no application on
this case.
SC was impressed with the petition.
SC said that the lower courts focused solely on the property relations of the parties involved in
light if the Civil Code and Family Code provisions but however failed to apply the principles on
the Constitution, which is more decisive.
Section 7, Article XII of the 1987 Consitution states
"Save in cases of hereditary succession, no private lands shall be transferred or conveyed except
to individuals, corporations, or associations qualified to acquire or hold lands of public domain"
By virtue of the aforementioned provision, aliens, whether individuals or corporations are
disqualified from acquiring lands of public domain. Our fundamental law cannot be any clearer.
The right to acquire lands of public domain is reserved ONLY to Filipino citizens or
corporations at least sixty percent of which is owned by Filipinos. Purpose of which is the
conservation of the national patrimony.
The rule is clear and inflexible: aliens are absolutely not allowed to acquire public or private
lands in the Philippines, save only in constitutionally recognized exceptions. There is no rule
more settled than that of the constitution.
SC cited several jurisprudence, one of which is the case of Cheesman VS IAC where the
petitioner is an American and his wife Criselda acquired a parcel of land which was registered on
the latter's name. Criselda sold the land to a third party without the consent of her husband.
Petitioner then sought to nullify the sale as he did not consent to it. The Court held that, he
acquired no right whatever over the property by virtue of the purchase him being an alien
because in attempting to acquire land he will knowingly violate the Constitution.
Wherefore, the Court find and so hold that Benjamin has no right to nullify the Agreement of
Lease being an alien. Considering Joselyn was the designated vendee in the Deed of Sale of said
property, she acquired sole ownership thereto. It doesn't matter if Benjamin provided the funds
for acquisition as by entering into such contract knowing it was illegal, no implied trust can be
created to his favor, nor reimbursement for his expenses can be allowed. CA and RTC decision
SET ASIDE.