Implied Trust

Dear PAO,

I was an OFW for almost 30 years. Since I was not here in the Philippines most of the time, I asked my sister to buy a house and lot on my behalf. Because of my trust in her, I also let the house and lot be registered under her name. I even let her and her family use it since I return home that often. Now that I am retiring, I told her that they needed to vacate and look for another house. She now refuses to leave and claims that since the title is under her name, she is the true owner of the property. Is she correct?

Jessica

Dear Jessica,

Please be informed of Article 1448 of the New Civil Code which states that:

«Art. 1448. 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 above-mentioned provision stated that there is an implied trust when a property is sold to one person but was paid by another for the purpose of having the beneficial interest in the property. In Pigao vs Rabanillo (GR 150712, May 2, 2006), the Supreme Court, through Chief Justice Renato Corona (then associate justice), held that:

«A resulting trust is exemplified by Article 1448 of the Civil Code xxx

»The trust created under the first sentence of Article 1448 is sometimes referred to as a purchase money resulting trust. The trust is created in order to effectuate what the law presumes to have been the intention of the parties in the circumstances that the person to whom the land was conveyed holds it as trustee for the person who supplied the purchase money.

«To give rise to a purchase money resulting trust, it is essential that there be:

»1. an actual payment of money, property or services, or an equivalent, constituting valuable consideration;

«2. and such consideration must be furnished by the alleged beneficiary of a resulting trust.

»There