Land Tits Finalssst PDF

Land Titles and Deeds [EH 408 S. Y.
2018-19]
Disclaimer: For exclusive personal use only. Not for sale.
SUBSEQUENT REGISTRATION Issue: Whether the certificate of sale could be registered using the old
entry made in 1980 notwithstanding the fact that the original copies of the
CHAPTER 5 (SEC. 51 TO 77) reconstituted certificates of title were issued only on June 19, 1984.
VOLUNTARY DEALINGS WITH REGISTERED LANDS
Held: Yes. DBP, complied with all that was required of it for purposes of
Section 51. Conveyance and other dealings by registered owner. both primary entry and annotation of the certificate of sale. So long as the
An owner of registered land may convey, mortgage, lease, charge or registrant has complied with all that is required of him for purposes of
otherwise deal with the same in accordance with existing laws. He may entry and annotation, nothing more remains to be done but a duty
use such forms of deeds, mortgages, leases or other voluntary incumbent solely on the register of deeds.
instruments as are sufficient in law. But no deed, mortgage, lease, or
other voluntary instrument, except a will purporting to convey or affect Case Doctrine:
registered land shall take effect as a conveyance or bind the land, but 1. (Primary) Entry alone produces the effect of registration,
shall operate only as a contract between the parties and as evidence of whether the transaction entered is a voluntary or an involuntary one, so
authority to the Register of Deeds to make registration. long as the registrant has complied with all that is required of him for
purposes of entry and annotation, and nothing more remains to be done
The act of registration shall be the operative act to convey or affect the but a duty incumbent solely on the register of deeds.
land insofar as third persons are concerned, and in all cases under this 2. The qualms implicit in the query of the respondent (and present
Decree, the registration shall be made in the office of the Register of appellee) register of deeds about making annotation of an entry effected
Deeds for the province or city where the land lies. before he assumed that office are more imagined than real. He would only
be making a memorandum of an instrument and of its entry based on or
A. Primary Entry Book (Sec. 56) reciting details which are already of indubitable record and, pursuant to
the express command of the law, giving said memorandum the same date
Section 56. Primary Entry Book; fees; certified copies. Each as the entry. No part of that function is exclusive to the incumbent of the
Register of Deeds shall keep a primary entry book in which, upon office at the time entry was made or is forbidden to any of his successors.
payment of the entry fee, he shall enter, in the order of their reception,
all instruments including copies of writs and processes filed with him National Housing Authority vs Augusto Basa
relating to registered land. He shall, as a preliminary process in
registration, note in such book the date, hour and minute of reception of Reiteration of DBP
all instruments, in the order in which they were received. They shall be
regarded as registered from the time so noted, and the memorandum of Sps. Basa procured a loaned from NHA secured by real estate mortgage.
each instrument, when made on the certificate of title to which it refers, The loan remained unpaid and NHA foreclosed the mortgage. The sheriff's
shall bear the same date: Provided, that the national government as well certificate of sale was registered and annotated only on the owner's
as the provincial and city governments shall be exempt from the payment duplicate copies of the titles in the hands of the respondents, since the
of such fees in advance in order to be entitled to entry and registration. titles in the custody of the RD were among those burned down when a fire
gutted the QC City Hall. After the redemption period, NHA consolidated
Every deed or other instrument, whether voluntary or involuntary, so ownership over the foreclosed properties, and the same was inscribed by
filed with the Register of Deeds shall be numbered and indexed and the RD on the certificates of title in the hand of NHA. Respondents
endorsed with a reference to the proper certificate of title. All records theorized that since the sheriff's certificate was only inscribed on the
and papers relative to registered land in the office of the Register of owner's duplicate certificate of title, and not on the certificate of title in the
Deeds shall be open to the public in the same manner as court records, possession of the RD, then there was no effective registration and the one-
subject to such reasonable regulations as the Register of Deeds, under year redemption period had not begun to run. Thus, respondents sought
the direction of the Commissioner of Land Registration, may prescribe. to redeem the property.
All deeds and voluntary instruments shall be presented with their Issue: Whether the annotation of the sheriff's certificate of sale on the
respective copies and shall be attested and sealed by the Register of owner's duplicate certificate of titles is sufficient registration considering
Deeds, endorsed with the file number, and copies may be delivered to that the inscription on the original certificates could not be made as the
the person presenting them. same got burned.
Certified copies of all instruments filed and registered may also be Held: Yes. The prevailing rule is that there is effective registration once
obtained from the Register of Deeds upon payment of the prescribed the registrant has fulfilled all that is needed of him for purposes of entry
fees. and annotation, so that what is left to be accomplished lies solely on the
register of deeds.
VOLUNTARY DEALING
- in accordance with the will of the registered owner; Durawood vs Candice Bona
- necessary to surrender the owner’s duplicate
Principle: All the requirements must be complied with in order to confer
PRIMARY ENTRY BOOK OR DAY BOOK jurisdiction upon the RD.
- record of all instruments, including copies of writs and processes, Facts: Durawood filed an action for sum of money plus damages with a
affecting registered lands; prayer for the issuance of a writ of preliminary attachment against LBB
- preliminary process in registration Construction as payment for construction materials. RTC then issued an
- instrument shall be regarded as registered only from the moment it is Order for the issuance of a writ of attachment. On June 17, 2004, A Notice
noted in the day book; of Levy on Attachment was annotated on the TCT of LBB’s property.
- record is constructive notice of its contents and all interests, legal and Candice Bona filed a Motion seeking leave to intervene claiming therein
equitable that LBB Construction had sold the property to her and her siblings through
a Deed of Absolute Sale. She asserted that the sale is the subject of an
REQUIREMENTS FOR REGISTRATION OF VOLUNTARY DEALINGS entry dated June 16, 2004 in the books of the RD, while the levy on
attachment is subject to an entry dated later on June 17, 2004.
a. Filing and registration in the day book of the notarized deed or
instrument; Issue: Whether the sale annotated earlier should prevail over the levy on
b. Surrender of the owner’s duplicate certificate of title; and execution.
c. Payment in full of the proper registration fees within 15 days from date Held: No. While it was true that the levy came later, it turned out that the
of entry fee required in the sale was not paid. There was one requirement that was
not complied with which was necessary to confer jurisdiction upon the RD.
REGISTRATION REQUIREMENTS As such, there was no complete act of registration. For failure to pay the
fee, the levy on execution takes precedence over the Deed of Absolute
a) Compliance with the essential requisites of a contract Sale. Amodias allegedly conveyed the subject property to respondent
b) Observance of the formal requirements of public AZNAR. This transaction was registered under Act 3344. Subsequently, the
instruments Amodias conveyed the subject property in favor of Go Kim Chuan. A TCT
c) Performance of the jurisdictional requisites for registration was issued in the name of Go Kim Chuan under Act 496. AZNAR filed a
d) In addition, special laws require the submission of supporting case against petitioners Amodias and Go Kim Chuan for Annulment of Sale
documents for certain transactions before registration is allowed and Cancellation of TCT alleging that the sale to Go Kim Chuan was an
invalid second sale of the subject property which had earlier been sold to
DBP vs Register of Deeds of Nueva Ecija it.
Entry in the primary entry book alone is considered a complete act of Issue: Who between Go Kim Chuan and AZNAR was able to validly
registration as long as all the requirements are present. register the property.
Facts: DBP presented for registration a sheriff's certificate of sale in its Ruling: Since the sale in favor of AZNAR was registered under Act No.
favor of two parcels of land covered, both in the names of the Sps. Bautista 3344 and not under Act No. 496, the said document is deemed not
and Calison. The transaction was entered in the Registry's primary Entry registered. Rather, it was the sale in favor of Go Kim Chuan which was
Book. DBP paid the requisite registration fees on the same day. Annotation registered under Act No. 496. AZNAR insists that since there was no
of the sale on the covering certificates of title could not, however be Torrens title on file in 1964, insofar as the vendors, AZNAR, and the
effected because the originals of those certificates were found to be Register of Deeds are concerned, the subject property was unregistered at
missing from the files of the Registry, where they were supposed to be the time. The contention is untenable. The fact that the certificate of title
kept, and could not be located. DBP instituted proceedings to reconstitute over the registered land
said certificates, and reconstitution was ordered in a decision rendered on
June 15, 1982. For reasons not apparent on the record, the certificates of
title were reconstituted only on June 19, 1984. Mendoza vs Garana
Prepared by: Gas

Source: Atty. Gimarino’s Discussion, Suan Notes, Vargas/Negado Case Digests
Land Titles and Deeds [EH 408 S. Y. 2018-19]
FACTS: During October 6, 1993, the heirs of Manuel Uy Ek Liong PRINCIPLES APPLICABLE:
represented by Belen Uy sought registration of a notice of lis pendens with
the Register of Deeds of Lucena City, which intended to bind plenty of SUBSEQUENT REGISTRATION; VOLUNTARY DEALINGS WITH REGISTERED
properties. They were subject to an action for specific performance where LANDS; PRIMARY ENTRY BOOK: The law does not require the presentation
the heirs of Uy wished to compel the sale of such properties. Upon the as well as the annotation of the involuntary instrument on the owner's
entry of the notice of lis pendens, Atty. Marquez, the registrar of RD duplicate title, or even on the original title. The mere recording of the
Lucena, wrote to the owners, requesting the surrender of the duplicate involuntary instrument in the primary entry book or day book is sufficient
copies of titles to annotate the notice of lis pendens. Jalbuena (one of the to bind the registered land and affect third persons dealing with it. the
registered owners) did not surrender her duplicate copy. Court subsequently reiterated in Levin, that in involuntary registration, the
entry of the instrument in the primary entry book or day book already
Even before seeking a notice of lis pendens, Uy already caused an serves as adequate notice to all persons of another person's or entity's
annotation of adverse claims on all titles in August 16 1993, which was adverse claim over a registered land.
then cancelled on Oct. 4, 1994 upon filing of an affidavit by Umali. RD
Lucena annotated the notice of lis pendens except Jalbuena’s title, whose B. Double Sales
original was missing from the vault. The original was with Carmelina
Rodriguez – a clerk at RD Lucena, who processed another transaction with ART. 1544, NCC. If the same thing should have been sold to different
this title but forgot to annotate the notice of lis pendens. vendees, the ownership shall be transferred to the person who may have
first taken possession thereof in good faith, if it should be movable
In 1994, Spouses Garana inquired about Jalbuena’s land for purchase, property.
later finding out that it was subject to an adverse claim which was Should it be immovable property, the ownership shall belong to the person
cancelled in 1994. They immediately bought the land in November 7, 1994. acquiring it who in good faith first recorded it in the Registry of Property.
Thus, RD Lucena cancelled the old TCT and issued a new one to the Should there be no inscription, the ownership shall pertain to the person
spouses, which bore no notice of lis pendens. The spouses then mortgaged who in good faith was first in the possession; and, in the absence thereof,
the property with Far East Bank and Trust Company (BPI) as security for to the person who presents
a loan. The heirs of Manuel Uy then learned that the land had been sold
and a new title was issued without the notice. They notified RD Lucena of RULE IN CASE OF DOUBLE SALE
the lapse and asked for an annotation of the notice to Garana’s new title.
Through Atty. Marquez (substituted by Mendoza), the RD Lucena filed a • Where two or more TCT are issued to different persons for the same
petition to annotate the notice of lis pendens in the trial court. lots, or subdivisions thereof, due to the fact that the original title was
not cancelled when the first TCT was issued to replace the original
Spouses Garana and BPI opposed the petition, arguing that the annotation title, which title prevails?
was too late and would be prejudicial, relying on the clean title which would • General rule is that in case of 2 certificates of title purporting to
grant them the status as innocent purchasers for value. BPI also submitted include the same land, the earlier in date prevails, whether the land
that when the land was mortgaged, there was no indication that it was comprised in the latter certificate be wholly or only in part, comprised
subject to pending litigation. in the earlier certificate
• Where 2 certificates of title purport to include the same land, the
The trial court ruled in favor of RD Lucena. CA granted the appeal and earlier in date prevails. In successive registrations, where more than
reversed the ruling, stating that the subject land is registered under the 1 certificate is issued in respect of a particular estate or interest in
Torrens system where no further investigation from the certificate of title land, the person claiming under the prior certificate is entitled to the
is necessary to determine the property’s condition. CA ruled that the estate or interest; and the person is deemed to hold under the prior
spouses were innocent purchasers. certificate who is the holder of, or whose claim is derived directly or
indirectly from the person who was the holder of the earliest
Under the present petition, the petitioner admits its procedural lapses of certificate issued in respect thereof.
issuing a new certificate of title without reflecting a notice of lis pendens. • The vendee of the earlier certificate would be the owner as against
However, they argue that the entry of the notice of lis pendens in the the vendee of the owner of the latter certificate.
primary entry book amounted to a valid registration, such that it should
not prejudice the heirs of Uy. They invoke Levin v. Bass, which stated that Note: Registration contemplated in this provision refers to registration
in case of involuntary registration (e.g. notice of lis pendens), entry in the under the Torrens System, which considers the act of registration as the
primary book is already sufficient notice to all persons. Petitioner also operative act that gives validity to the transfer or creates a lien upon the
argues that the spouses were not innocent purchasers for value because land. This rule precisely applies to cases involving conflicting rights over
they already knew of the first annotation of adverse claim before buying registered property and those of innocent transferees who relied on the
the land – only waiting to buy it upon cancellation of the adverse claim. clean title of the properties. Thus, we held that registration must be done
in the proper registry in order to bind the same. (Melencio v. CA)
ISSUES: Whether or not an entry of a notice of lis pendens in the primary
entry book serves as notice to third persons, to the effect that an absence Melencion vs Ca
of an annotation on the title has no effect towards the binding nature of
the notice of lis pendens to all persons dealing with the land. FACTS: The subject lot is a 30, 351 sq. m. land in Lapu-Lapu City and a
part of a total area of 30, 777 sq. m. in the name of Go Kim Chuan. The
RULING: Petition is granted. The ruling is rooted in Villasor v. Camon, property was originally owned by Estaban Bonghanoy, who had only one
reiterated in Levin v. Bass, stating that there is a difference between a child – Juana Bonghanoy-Amodia, mother of Leoncia Amodia and the
registration of a voluntary instrument (e.g. sale, mortgage, or lease) vs. petitioners Melencion and the Amodias. The entire property was under the
registration of an involuntary instrument (e.g. attachment, lien, notice of Torrens System, but the title was lost during WWII.
lis pendens). The voluntary instrument requires the owner’s production of
his own duplicate certificate of title before registration because it is the On July 10, 1964, the Amodias executed an Extra-Judicial Partition (EJP)
willful act of the owner where it is expected that he produce all the of Real Estate with Deed of Absolute Sale, conveying the property to Aznar
necessary documents to facilitate registration. On the other hand, the for P10, 200.00. It was registered in August 10, 1964 under Act 3344
involuntary instrument are adverse claims against the registered owner, because there was no title on file at the RD Lapu-Lapu City. In Feb. 18,
so he cannot be expected to provide all the necessary documents like a 1989, Melencion and the Amodias executed another settlement with
duplicate copy. Absolute Sale to Go Kim Chuan for P70, 000. The lost title was
reconstituted under Act 26, issued in the name of Esteban Bonghanoy and
Such cases were decided under Act No. 496 Sec. 51, 55, and 56, which subsequently a derivative title in Go Kim Chuan’s name. He then controlled
basically states that it states that registration in the office of the RD will and exercised dominion over the property as an owner.
be notice to all persons from the time of registration. Furthermore, the
notification in the book of the year, month, day, hour, and minute of In Feb. 14, 1990, AZNAR wrote a letter to the petitioners, asking to
reception of all instruments shall be regarded as registered from the time withdraw/nullify the sale between the petitioners and Go Kim Chuan while
so noted. Sec. 55 provides for the rule on voluntary registration (requiring also filing a Notice of Adverse Claim. Due to no positive response, AZNAR
more than just mere entry in the primary book). This was carried over to filed a case against the Amodias and Go Kim Chuan for Annulment of Sale
PD 1529, the current law governing land registration. and Cancellation of the TCT, claiming that Go Kim Chuan was an invalid
second sale of the subject property. Petitioners denied executing the EJP
In the subsequent cases (Caviles, Armed Forces and Police Mutual Benefit of Real Estate with Deed of Absolute Sale to AZNAR, stating that signatures
Association, and Saberon), the same doctrine is pronounced. The same were forged.
occurrence regarding the lack of a notice of lis pendens was present in the
following cases, pronouncing in Caviles that persons who caused RTC dimissed the complaint, declaring Chuan as the real owner, reasoning
registration cannot be held negligent for not checking if the RD performed that the signatures were found by the document examiner of the Philippine
its obligations, and that the duty to annotate rests with the Register of Constabulary Crime Laboratory to be forged. It was brought under the
Deeds and not with the registrant. Thus, it ruled in the Caviles case that Land Registration Act which should have complied with the said law.
the person who first registered his instrument had a superior right over Finally, AZNAR failed to prove Chuan’s bad faith. The CA granted AZNAR’s
the other. Such pronouncement carried over to the later cases. claim, stating that the sale in favor of AZNAR was registered ahead of
Chuan’s, so preference should be given to AZNAR. The adverse claim was
In the case of Casimiro Devt. Corporation v. Mateo, the Court stated that also annotated earlier than the execution of the sale to Chuan, so he
anything that arouses suspicion should require the vendee to look beyond should’ve respected the adverse claims. The finding of the document
the certificate. The mere fact that Umali sought the cancellation of the examiner was found to be insufficient. CA denied the motion for
adverse claim should have aroused the spouses’ suspicious over the land’s reconsideration.
real condition. They knew that there was a previous adverse claim that
was cancelled and yet did not ask Jalbuena nor Belen Uy. These facts The petitioners argue that the lot was already registered under Act 496,
dispute the assertion of being oblivious to any claim that the heirs had over so the registration in 1964 under Act 3344 produces no legal effect;
the subject land. Such is also true with BPI, who should have exercised a assuming the lot was registered as an unregistered land, it is without
higher degree of diligence when dealing with the TCT. They can no longer prejudice to better rights, and the CA erred in stating that the adverse
raise the defense of indefeasibility of title since they did not act in good claim was already present at the time of sale to Chuan. AZNAR argues that
faith. Chuan was a buyer in bad faith for having constructive notice of the sale
since it was registered under Act 3344, noting the fact that the property
Prepared by: Gas

wasn’t covered by a Torrens title; that there was no other mode of - Original owner may seek annulment of transfer on the ground of
registration except Art. 3344; that Chuan could not examine any certificate fraud.
of title because he had to wait for reconstitution; that the second sale did
not transfer because it wasn’t within their power to convey anymore; and 2. Generally, a forged deed is a nullity and conveys no title. But a
finally, AZNAR cites Santiago v. CA stating that the prior registration and forged deed may be the basis of a valid title if the certificate of title has
sale under Act 3344 would be constructive notice to Chuan and negates already been transferred from the name of the true owner to the name of
the claim of good faith. the forger, and while it remained that way, the land was subsequently sold
to an innocent purchaser for value.
ISSUES: Who between Go Kim Chuan and AZNAR has the better right over
the subject property? REGISTRATION IS CONSTRUCTIVE NOTICE TO THIRD PERSONS
RULING: Go Kim Chuan has the better right. Appropriate here is Art. 1544 • The act of registration shall be the operative act to convey or
of the NCC, providing the rules on double sale (ownership transferred to affect the land insofar as third persons are concerned
the person who has first recorded it in the Registry of Property if • It is the act of registration which creates a constructive notice to
immovable. Should there be no inscription, the ownership shall pertain to the whole world and binds third persons
the person who in good faith was first in possession, and in absence • Absent such registration, a conveyance doesn’t affect or bind the
thereof, to the person who presents the oldest title, provided there is good land
faith). The registration contemplated here refers to registration under the • Under the rule on notice, there is a conclusive presumption that
Torrens system. It applies to cases involving conflicted rights over the purchaser has examined every instrument of record affecting the title
registered property and those of innocent transferees who relied on the • He is charged with notice of every fact shown by the record and
clean title of the properties. is presumed to know every fact shown by the record and is presumed to
know every fact which an examination of the record would have disclosed
It is indisputable that the property was under the Torrens system before • Since it is the act of registration which transfers ownership of
conveyances to AZNAR and Chuan were made. Despite this knowledge, the land sold, it has been held that a subsequent claimant cannot claim a
AZNAR registered it under Act 3344, contending that at the time of sale, better right over the land which had been previously registered in the name
there was no title on file. Act 3344 provides a system of recording of another.
transactions or claims over unregistered real estate without prejudice to a • A notice of lis pendens serves as a warning to a prospective
third party with a better right. If it is registered under the Land Registration purchaser or encumbrancer that the particular property is in litigation and
Act (LRA), and it is sold and registered not under the LRA but Act 3344, that he should keep his hands off the same, unless he intends to gamble
the sale is not considered registered. The mere fact that the certificate of on the results of the litigation.
title over the land was lost does not convert it into unregistered land.
BUT A PURCHASER WHO HAS KNOWLEDGE OF DEFECT OF HIS
AZNAR should have reconstituted the title instead of registration under Act
VENDOR’S TITLE CANNOT CLAIM GOOD FAITH
3344. However, this cannot be the sole basis of awarding subject property
for good faith must accompany registration. The second purchaser must
• A purchaser cannot close his eyes to facts which should put a
be in good faith.
reasonable man upon his guard, and then claim that he acted in good faith
under the belief that there was no defect in the title of the vendor
We do not agree that the adverse claim was made prior to issuance of the
• His mere refusal to believe that such defect exists or his willful
TCT to Chuan). The court cannot review facts unless there was a
closing of his eyes to the possibility of the existence of a defect in the
misapprehension of facts which would justify a different conclusion. In this
vendor’s title, will not make him an innocent purchaser for value, if it
case, the claim was annotated in 1990 after the title was reconstituted an
afterwards develops that the title was in fact defective, and it appears that
after issuance of the TCT in 1989. The reliance on Santiago is misplaced
he had no such notice of the defect as would have led to its discovery had
because the first buyers registered the sale under the Torrens system, not
he acted with that measure of precaution which may reasonably be
under Act 3344. AZNAR registered the sale under Act 3344 despite
required of a prudent man in a like situation.
knowing that the property is under the Torrens system. Chuan made
verifications with the City Assessor and RD, finding no adverse claim
A FORGED DEED MAY BE THE BASIS OF A GOOD TITLE IN THE
against the Amodias. The good faith of Chuan cannot be doubted,
HANDS OF A BONA FIDE PURCHASER
considering he followed all the necessary procedures to acquire the title in
his name. Finally, AZNAR’s complaint for cancellation of title contains no
• A forged deed may be the root of a valid title in the hands of a
allegation that Chuan was aware of defects in his title.
bona fide purchaser or mortgagee
• Torrens system permits a forged transfer, when duly entered in
PRINCIPLES APPLICABLE
the registry, to become the root of a valid title in a bona fide purchaser
• The law erects a safeguard against a forged transfer being
RULES IN DOUBLE SALE: In application of first registration regarding
registered by the requirement that no transfer shall be registered unless
ownership in disputes of double sales, it is important to note that
the owner’s certificate is produced along with the instrument of transfer
registration of the property must be done in the proper registry for it to be
• Public policy, expediency, and the need for a statute of repose
considered registered. Furthermore, mere registration of title is not
as to the possession of land, demand such a rule.
enough. Good faith must accompany the registration. What is important
• The right or lien of an innocent mortgagee for value upon the
for this purpose is not whether the second buyer is a buyer in good faith,
land mortgaged must be respected and protected, even if the mortgagor
but whether he registers the second sale in good faith, meaning, he does
obtained his title through fraud.
so without knowledge of any defect in the title over the property sold.
REAL ESTATE MORTGAGE
C. Buyer in Good Faith
Section 60. Mortgage or lease of registered land. Mortgage and
leases shall be registered in the manner provided in Section 54 of this
Section 52. Constructive notice upon registration. Every
Decree. The owner of registered land may mortgage or lease it by
conveyance, mortgage, lease, lien, attachment, order, judgment,
executing the deed in a form sufficient in law. Such deed of mortgage or
instrument or entry affecting registered land shall, if registered, filed or
lease and all instruments which assign, extend, discharge or otherwise deal
entered in the office of the Register of Deeds for the province or city where
with the mortgage or lease shall be registered, and shall take effect upon
the land to which it relates lies, be constructive notice to all persons from
the title only from time of registration.
the time of such registering, filing or entering.
No mortgagee's or lessee's duplicate certificate of title shall hereafter be
issued by the Registers of Deeds, and those issued prior to the effectivity
Section 53. Presentation of owner's duplicate upon entry of new
of this Decree are hereby deemed canceled and the holders thereof shall
certificate. No voluntary instrument shall be registered by the Register of
immediately surrender the same to the Register of Deeds concerned.
Deeds, unless the owner's duplicate certificate is presented with such
instrument, except in cases expressly provided for in this Decree or upon
ESSENCE OF MORTGAGE
order of the court, for cause shown. The production of the owner's
The property has been identified or set apart from the mass of property of
duplicate certificate, whenever any voluntary instrument is presented for
the debtor-mortgagor as security for the payment of money or the
registration, shall be conclusive authority from the registered owner to the
fulfillment of obligation to answer the amount of indebtedness, in case of
Register of Deeds to enter a new certificate or to make a memorandum of
default of payment.
registration in accordance with such instrument, and the new certificate or
memorandum shall be binding upon the registered owner and upon all
REQUISITES OF MORTGAGE (ART. 2085, NCC)
persons claiming under him, in favor of every purchaser for value and in
1. Constituted to secure the fulfillment of a principal obligation;
good faith. In all cases of registration procured by fraud, the owner may
2. The mortgagor be the absolute owner of the thing mortgaged;
pursue all his legal and equitable remedies against the parties to such fraud
and
without prejudice, however, to the rights of any innocent holder for value
3. That the persons constituting the mortgage have the free
of a certificate of title. After the entry of the decree of registration on the
disposal of their property, and in the absence thereof, that
original petition or application, any subsequent registration procured by
they be legally authorized for the purpose.
the presentation of a forged duplicate certificate of title, or a forged deed
or other instrument, shall be null and void.
HOW FORECLOSED:
1. JUDICIAL Foreclosure — governed by Rule 68 of the Rules of Court
THINGS TO REMEMBER REGARDING SEC. 53
2. EXTRAJUDICIAL — governed by Act 3135, as amended by Act 411
1. Surrender of owner’s duplicate certificate is authority for the RD to enter
registration. No voluntary instrument shall be registered by the RD unless
the owner’s duplicate certificate is presented with such instrument, except THINGS TO REMEMBER REGARDING REM
in cases upon order of the court for cause shown. - Mortgage lien is a right in rem which follows the property;
- The issuance of a new TCT by the RD to the purchaser, w/o the - A REM is a voluntary transaction, as such, you have to present the
presentation of the owner’s duplicate, is unwarranted and confers no owner’s duplicate of copy for purposes of registration;
right on the purchaser. - The REM is the accessory contract; the primary contract is the
- In case of refusal or failure to surrender owner’s duplicate certificate, contract of loan.
the party in interest may file a petition in court to compel surrender
of the same to the RD pursuant to Sec. 107.
Uy vs Fule
Prepared by: Gas

executed on July 31, 1998. The argument by petitioner did not address
FACTS: The land in dispute is an area of 180, 150 sq. m. in Camarines whether he was in good faith or not; it only addressed whether Ronda held
Sur that was part of the vast tract of land in the name of Conrado Garcia. the right to transfer ownership but did not address whether transfer to
After his death on November 23, 1972, his heirs entered into an petitioner was valid. Only the OCTs could be examined by petitioner, which
extrajudicial settlement of his estate, and then caused registration on recited the prohibition of non-transferal except by hereditary succession or
March 7, 1973. to the government. It negates the 3rd condition in the requisites of good
faith, requiring the petitioner to exercise a higher degree of diligence; thus,
In September 1985, DAR engaged Engr. Sales to conduct a survey over the petitioner is not an innocent purchaser for value and cannot be
the disputed land. He issued a joint certification in August 30, 1988, stating awarded the land.
that the land was an “untitled” property owned by Conrado Garcia. It was
supported by a certification in Jan. 30, 1989 by the Office of the RD, stating PRINCIPLES APPLICABLE
that no title covered the said land. In effect, the land was included in the
Operation Land Transfer (OLT) program of DAR under PD 27. In 1988, DAR RULES ON BUYERS IN GOOD FAITH: The standard is that for one to be
and the Office of the RD issued Emancipation Patents (EP) and OCTs to a purchaser in good faith in the eyes of the law, he should buy the property
farmer-beneficiaries (Alcaide, Ronda, Ermita, Marcelo, and the of another without notice that some other person has a right to, or interest
Pedimontes). Ronda sold his portion to Chisan Uy who registered his title in, such property, and should pay a full and fair price for the same at the
in the RD. The heirs of Ronda then sold the land to Hector Uy for P10 time of such purchase, or before he has notice of the claim or interest of
million, where he registered it in the same place. some other persons in the property. He buys the property with the belief
that the person from whom he receives the property was the owner and
In 1997, the old TCT was cancelled following partition, and new ones were could convey title to the property.
issued in the names of respondent heirs of Conrado Garcia. One TCT
covered the disputed land. In 1998, the President through the DAR The requisites for the buyer to be in good faith is that he buys the property
Secretary issued the EPs to the farmer beneficiaries. On December 21, with the well-founded belief that the person from whom he receives the
1998, the respondents filed a complaint for quieting of title, recovery of thing had title to the property and capacity to convey it. Thus, he no longer
possession, and damages against the DAR Secretary and staff involved, as needs to go beyond the four corners of the title. Such degree of proof of
well as the farmer-beneficiaries, arguing that they were denied due good faith, however, is sufficient only when the following conditions
process and that the titles of the defendants constituted clouds on their concur: (1), the seller is the registered owner of the land; (2), the latter is
own title. in possession thereof; and (3), at the time of the sale, the buyer was not
aware of any claim or interest of some other person in the property, or of
RTC ruled in favor of the respondents, stating that there was no notice of any defect or restriction in the title of the seller or in his capacity to convey
inclusion of the disputed lands. Appeal was made to the CA by Ronda, title to the property. If one or more requisites are not met, it was no longer
Alcaide, Casaysayan, and Chisan Uy (government officials and other sufficient for said buyer to merely show that he had relied on the face of
farmer-beneficiaries did not appeal). They argue that the RTC had no the title; he must now also show that he had exercised reasonable
jurisdiction, erred in holding that the titles were void, and erred in holding precaution by inquiring beyond the title.
that the proceedings taken by the government officials in generating the
Eps and CLTs were void. They insisted that the RTC erred in holding that LBP vs Poblete
Uy was not an innocent purchaser in good faith. Respondents assert that
the land did not lose its character and registered land. Being registered, it FACTS: Poblete is the registered owner of a parcel of land in Occidental
should not have been subject to another land registration proceeding Mindoro. In October 1997, Poblete obtained a P300, 000 loan from
where EPs and titles could be derived. CA denied the appeal, stating that Kapantay (Kabalikat ng Pamayanan ng Nagnanais Tumulong at Yumaman
the land was already titled which requires DAR to notify the registered Multi-Purpose Cooperative), mortgaging the land to guarantee payment of
owner. A land covered by a title cannot be a subject of an application for the loan. In turn, Kapantay used the OCT as a collateral in its Loan Account
registration unless the title which is now indefeasible is nullified by a proper in Land Bank.
court proceeding. On the issue of petitioner and Chisan Uy being
purchasers in good faith, CA disagreed stating that even if they had no In November 1998, Poblete decided to sell the land to pay her loan,
notice of defect, no valid title can be passed to them since the transfers instructing her son-in-law Balen to look for a buyer. He referred Maniego
are void ab initio. to Poblete, and he agreed to buy the lot for P900, 000 but suggested that
a deed of absolute sale for P300, 000 be executed to reduce taxes. Poblete
Furthermore, in CA’s denial of the motion for reconsideration, CA cited executed the Deed of Absolute Sale in November 9, 1998 with P300, 000
Baltazar v. CA, stating that where two persons both in good faith and as consideration and described herself as a widow. She asked Balen to
innocent of any negligence, the law must protect and prefer the lawful deliver the deed and receive payment on her behalf, where Balen testified
holder of registered title over the transferee of a vendor bereft of any that he delivered the deed to Maniego but did not receive the agreed
transmissible rights. Hector and Chisan Uy’s transferors had no purchase price. Maniego said he would pay the amount upon his return
transmissible rights because their titles were void, coming from an from the US. In an affidavit, Poblete agreed to have the payment deposited
erroneous declaration that the property was untitled. to her Land Bank Savings account.
The petitioner in his appeal to the SC, argues that he paid the full price of Based on a certification issued by LBP Department Manager Pulayan in
P10 million, that all documents shown to him by the vendors did not August 20, 1999, Maniego paid Kapantay’s loan account for P448, 202.08.
indicate any defect in the title, that the records state that Ronda was On June 8, 2000, he applied for a loan of P1 million, using the subject
awarded the OCTs, and that the settlement revealed that he was dealing property as collateral. Land Bank stated that as a condition for approval,
with Ronda’s heirs. Absent any irregularities, he did not have to look the title should first be transferred to Maniego. In August 14, 2000, the RD
beyond the titles presented and could not have been aware of the claim of Occidental Mindoro issued a TCT in Maniego’s name. On August 15,
over the disputed lots. The only time he could have been aware of 2000, Maniego and Land Bank executed a Credit Line Agreement and Real
constructive notice was after the annotation of adverse claim made 5 Estate Mortgage while simultaneously releasing the P1 million proceeds to
months after the sale to him. Thus, the right of an innocent purchaser must Maniego. He failed to pay the loan, and on November 4, 2002, Land Bank
be protected, even if seller obtains title through fraud. On the issue of applied for foreclosure, stating that Maniego’s debt amounted to P1, 154,
applicability of laws, RA 6657 should be applied using the 10-year 388.88.
prohibition period rather than perpetual prohibition because RA 6657
repealed PD 27’s rules on prohibition against transfer. Ronda secured the On December 2, 2002, Poblete filed a complaint for nullification of the Deed
OCTs through hereditary succession and the second transfer was beyond and reconveyance of title and damages. Poblete alleged that despite
the 10-year period. Respondents counter that their action for quieting of demands for payment, she did not receive the payment of P900, 000.
title was premised on the illegal acquisition of their decreed and titled Without her knowledge, Maniego used the deed to acquire the OCT from
property by the DAR under the OLT program. The title did not lose its Kapantay. The Deed allegedly bore Poblete’s and her dead husband’s
character as being valid since November 23, 1933. The claim of good faith forged signature, presenting the death certificate of her husband in the
is denied. He did not exercise due diligence in examining the title of the NBI. LBP on the other hand claims it is a mortgagee in good faith,
heirs of Ronda, stating that the title was acquired erroneously through the observing due diligence prior to approval of the loan by verifying Maniego’s
OLT program and that the prohibition made it clear that the lots shall not title with the RD. It also made a cross-claim against Maniego for payment
be transferred except by hereditary succession or to the government. of the loan. Maniego denied allegations and stated it was Poblete who
forged the signature. He alleged that he paid the consideration of the sale
ISSUES: Whether or not CA erred in failing to find that he was an innocent and even her loans.
purchaser for value who had the better right than the respondents over
the disputed land and failed to find that the applicable law was RA 6657, The RTC ruled in favor of Poblete, holding that the sale was a nullity. The
not PD 27. agreed consideration was not paid, and the signatures were proven to be
forgeries. RTC ruled that Lan Bank was not a mortgagee in good faith since
RULING: CA decision is affirmed. According to Bautista v. Silva, the it did not exercise the diligence required of banking institutions since it
requisites for the buyer to be in good faith is that he buys the property would’ve known that the sale was never consummated. However, the
with the well-founded belief that the person from whom he receives the cross-claim was granted. The CA affirmed the RTC decision in toto.
thing had title to the property and capacity to convey it. Thus, he no longer
needs to go beyond the four corners of the title. Such degree of proof of ISSUES: Whether or not LBP is a mortgagee in good faith?
good faith, however, is sufficient only when the following conditions
concur: (1), the seller is the registered owner of the land; (2), the latter is RULING: LBP is not a mortgagee in good faith. A forged deed was made,
in possession thereof; and (3), at the time of the sale, the buyer was not and such conveys no title. Where the deed of sale states that the purchase
aware of any claim or interest of some other person in the property, or of price has been paid but not actually paid, the deed is void ab initio for lack
any defect or restriction in the title of the seller or in his capacity to convey of consideration. The corresponding TCT issued is void. According to Yu
title to the property. If one or more requisites are not met, it was no longer Bun Guan v. Ong, the certificate of title was cancelled upon finding that
sufficient for said buyer to merely show that he had relied on the face of the deed of sale was simulated. In Ereña v, Querrer-Kauffman, the court
the title; he must now also show that he had exercised reasonable stated that when the instrument presented for registration is forged, the
precaution by inquiring beyond the title. registered owner does not lose title and neither does the mortgagee
acquire any right to the property.
The deed of sale executed between Ronda and the petitioner shows that
the TCTs were issued only on August 17, 1998, but the deed of sale was
Prepared by: Gas

It is settled that the title of Maniego is null and void, but it is without settlement upon verification with the Register of Deeds, and that the
prejudice to his right to recover from Poblete what he paid to Kapantay. College was a buyer in bad faith for being aware of the co-ownership.
The real estate mortgage constituted over it is also void since it is essential • The College counter-argued that: it is a buyer in good faith for making
that the mortgagor be the absolute owner of the property to be mortgaged. exhaustive investigations from all reliable tolerance, declaring that
the heirs were staying merely by tolerance, the tax declaration
Land Bank insists that it is a mortgagee in good faith since it verified the showed that Melecia admitted to Godofredo’s ownership of the lot,
title, did a credit investigation, and inspected the lot. However, the Court the occupancy permit of Melecia was issued only after Godofredo
has ruled that the rule on mortgagees in good faith not being required to issued a certification so that Melecia was allowed to occupy a portion
look beyond the face of the title does not apply to banks. They are required of the property, and the settlement was published three times
to observe a higher standard of diligence since it is so impressed with consecutively in a newspaper of general circulation.
public interest which requires more prudence than a private individual. • Basically, the College claims it was in good faith because Melecia is
Good faith is a question of intention, ascertained by the evidence as to not the real owner; she only possessed by mere tolerance.
conduct and outward acts. • Nacalaban et. al. denied the allegations of the heirs, claiming that
they have acquired the property by intestate succession and also
Land Bank processed the loan application upon presentation of title and argued on laches and prescription. Furthermore, they stated that the
ignored the fact that Kapantay previously used Poblete’s title as collateral action for reconveyance was improper since it was already sold to an
in its loan account with Land Bank. In the case of Bank of Commerce v. innocent purchaser for value.
San Pablo Jr., the person applying for the loan other than the registered • The College filed for a separate complaint for Unlawful Detainer and
owner should already have raised suspicion, requiring further inquiry to Damages in the MTCC against the Heirs of Melecia. The heirs
confirm the authority to mortgage. Ignoring such a significant fact, the counterclaimed that they possessed the property in co-ownership
person is not an innocent purchaser for value. The records not not even because it was purchased by their predecessor. They reiterated their
show that Land Bank investigated and inspected the property to ascertain previous arguments.
the actual occupants but only inspected the lot to appraise its value. In • (UNLAWFUL DETAINER CASE FILED BY THE COLLEGE) MTCC ruled in
Prudential Bank v. Kim Hyeun Soon, the bank is required to conduct an favor of the College, and the RTC affirmed the MTCC’s decision, giving
ocular inspection not only to appraise the property but also to inquire who the Heirs of Melecia 30 days from notice to vacate. A motion for
the occupants were. reconsideration was filed but was denied. Thus, an appeal to the CA
was made.
In conditioning the approval of the loan upon transfer, LBP admits that the • (RECONVEYANCE CASE FILED BY HEIRS) RTC rendered a decision in
processing was based on assurances that the title would soon be favor of the heirs, stating that the money of Melecia was used in
Maniego’s, but in LBP’s haste, it appears as if the loan was already buying the property, but Godofredo’s name was used in the title. A
processed while the collateral was still in Poblete’s name. LBP did not trust was established through Art. 1448 of the Civil Code.
ascertain ownership nor the authority of the supposed agent executing the • Both parties filed separate appeals to the CA which consolidated both
mortgage; thus, it is not a mortgagee in good faith. Ultimately the lot appeals. It affirmed the RTC decisions in the unlawful detainer case,
remains with Poblete. stating that the College is a buyer in good faith and that prescription
has not yet set in since the heirs are in actual possession.
PRINCIPLES APPLICABLE • The heirs filed for certiorari, stating that the College is not a buyer in
good faith because it did not buy the property from the registered
RULES REGARDING BUYERS IN GOOD FAITH: It is essential that the owner – Godofredo, not Nacalaban. The College should have
mortgager be the absolute owner of the mortgage; otherwise, the exercised higher diligence.
mortgage is void. The doctrine about a mortgagee in good faith does not • Issue: Whether or not the College is a buyer in good faith. (Less
apply to banks which are required to observe a higher standard of important: Whether or not an action for reconveyance was proper).
diligence. A bank cannot assume that simply because the title offered a • Ruling:
security is on its face, free of any encumbrance or lien, it is relieved of the • (ACTION FOR RECONVEYANCE) An action for reconveyance is proper.
responsibility of taking further steps to verify the title and inspect the There is an implied trust when property is sold, and the legal estate
properties to be mortgage. 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 a
Legarda vs CA trustee while the latter is the beneficiary.
Principle: When the subject property is already in the hands of an ELEMENTS TO ESTABLISH AN IMPLIED TRUST
innocent purchaser for value, it can no longer be returned to its original
owner. • There are two elements to establish trust: (1) an actual payment of
money and etc. or an equivalent constituting valuable consideration,
Facts: Cathay filed a complaint against Legarda alleging that Legarda and (2) such must be furnished by the alleged beneficiary of a
entered into a lease agreement with it, through its representative Cabrera, resulting trust.
and that there was a breach of the terms thereof. Pursuant to a court • Melecia’s money was used to buy the property but was placed in
order, the property of the Legarda was eventually sold to Cabrera at a Godofredo’s name. She purchased it because Felisia, an heir, wanted
public auction and thereafter registered under his name. After learning the to build a pharmacy. Melecia built a residential buiding and allowed
unfortunate turn of events, Legarda sought to annul the judgment at the Godofredo to mortgage a house he built on the property because she
CA. Howver, Legarda was declared in default due to negligence of counsel. trusted him. The title does not operate to vest ownership upon the
Later, the SC (Gayanco decision) ruled in favor of Legarda on account that property in favor of the College because the title is not a mode of
the negligence of her counsel affected her right to due process. It ordered acquiring ownership (Naval v. CA).
Cathay to reconvey the property to Legarda and to cancel the registration
of the said property in the name of Cathay. However, after this decision, THE COLLEGE IS A BUYER IN BAD FAITH FOR BEING AWARE OF THE HEIRS
Cathay was not able to return the property to Legarda because it nor longer OF MELECIA POSSESSING THE PROPERTY, BYPASSING THE GENERAL
possessed nor owned the property since such has already been subject to RULE OF GOOD FAITH
a series of transfers to innocent third parties at the time of promulgation
of the said judgment. • (BUYER IN BAD FAITH) The lower court sustained the College’s status
as an innocent purchaser for value on the basis of a lack of annotation
Issue: Whether or not the subsequent transfers of the property are valid of the heirs’ claim on Godofredo’s title, the proper publication of the
as the sucessors in interest were considered as innocent purchasers for extrajudicial settlement, an issuance of a certification to Melecia
value. allowing her to occupy a portion of the lot, and the tax declaration.
• Whether one is a buyer in good faith and whether due diligence and
Held: Yes, the transfers were valid and the successors of interest of prudence were exercised are questions of fact.
Cabrera are innocent purchasers of good faith. The successors relied on • (Bautista v. Silva) REQUISITES FOR ONE TO BE CONSIDERED A
the clean title of the subject land that were presented by their PURCHASER IN GOOD FAITH: (1) seller is the registered owner of the
predecessors. Since the property is already in the hands of an innocent land; (2) latter is in possession thereof; (3) at the time of sale, buyer
purchaser for value, it can no longer be returned to its original owner by was not aware of any claim or interest of some other person in the
Cabrera, much less by Cathay itself property, or of any defect or restriction in the title of the seller or in
his capacity to convey the title to the property.
Gabutan v. Nacalaban
NO LONGER SUFFICIENT TO RELY ON THE FACE OF THE TITLE IF ONE OR
Facts: MORE REQUISITES OF GOOD FAITH IS ABSENT
• In 1957, Godofredo Nacablan purchased an 800 sq. m. piece of land
in Cagayan de Oro City from the Daamos. A TCT was issued in the • Absent one or two of the foregoing conditions, the law puts the buyer
name of Godofredo and thereafter, he built a house on it. He died in on notices and obliges the later to exercise a higher degree of
1974 and was survived by his wife, Baldomera and their children. diligence by scrutinizing the certificate of title and examining all
• Baldomera issued a certification in favor of her mother Melecia which factual circumstances. It’s no longer sufficient to rely on the face of
provided that she could build and occupy a house on the portion of the title.
the property. The tax declaration showed that Melecia owned the • The College has the burden to prove its status as a purchaser in good
building previously owned by Godofredo. faith. It cannot be discharged by legal presumption, and the College
• Baldomera died in 1994, and her children subsequently executed an has failed to discharge such.
Extrajudicial Settlement of Estate of Deceased Person with Sale to the • Nacalaban et. al. are not the registered owners, but Godofredo
College. The old TCT was cancelled and the new one was issued in (Bautista v. CA – sale made not by a registered owner requires a
the name of the College. Melecia died in 1997 and was survived by higher degree of diligence).
her children. Soon after, the college demanded that the heirs of • Second, the College was aware that the Heirs of Melecia were in
Melecia vacate the premises. possession of the property. (Occeña v. Esponilla – the purchaser
• The heirs filed a complaint for reconveyance against Nacalaban and should have verified on the authority of the occupants’ possession
the College, alleging that: Melecia bought the property with her own instead of relying on the representation of the vendors that they were
money but Godofredo executed the Deed of Absolute Sale in his squatters).
name, Godofredo and Baldomera were only trustees of the property • "Honesty of intention" which constitutes good faith implies a freedom
in favor of Melecia, the real owner, they only knew about the from knowledge of circumstances which ought to put a person on
Prepared by: Gas

inquiry. If the land purchased is in the possession of a person other value to the testimony, and the respondent failed to present
than the vendor, the purchaser must be wary and must investigate convincing evidence to the contrary.
the rights of the actual possessor. Without such inquiry, the purchaser
cannot be said to be in good faith and cannot have any right over the NOBLEZA IS NOT A BUYER IN GOOD FAITH FOR IRREGULARITIES FOUND
property. IN THE DEED OF ABSOLUTE SALE REGARDING CONFLICTING DATES AND
SILENCE ON CIVIL STATUS
Nobleza v. Nuega
• Regarding the issues in the execution of the Deed of Absolute Sale, it
Facts: also poses a question on the claim of good faith.
• Shirley Nuega was married to Rogelio Nuega in September 1990. In • The Deed of Absolute Sale was executed and dated in December 29,
1998 while the couple was still engaged, Shirley was a domestic 1992, but the Community Tax Certificates were dated January 2 and
helper in Israel while Rogelio was a seaman. Shirley sent Rogelio 20, 1993.
money upon his request for the purchase of a lot in Marikina where • The CTC and Deed of Absolute Sale dates on different dates are
they planned to build their home. material because there is an irregularity, making it seem as though
• The next year, Rogelio bought the subject house which had an area the sale was made PRIOR TO THE FILING OF THE PETITION FOR
of 111 sq. m. Shirley claims that when she arrived to the Philippines, LEGAL SEPARATION.
she settled the balance for the equity of the subject property through • While the TCT shows Rogelio as single, the Deed of Sale did not
SSS financing and paid for the succeeding monthly amortization. The include Rogelio’s civil status as a seller, further casting a cloud of
TCT issued was solely under the name of Rogelio. doubt on the claim of petitioner with regard to her status as an
• The following year after their marriage, Shirley returned to Israel for innocent purchaser for value.
work but received information that Rogelio had another woman, • THE DEED OF ABSOLUTE SALE IS VOID IN ITS ENTIRETY FOR BEING
Monica Escobar. Upon her return in May 1992, she confirmed that SOLD WITHOUT THE CONSENT OF ONE OF THE SPOUSES, THE
Rogelio had been introducing the woman as his wife. PROPERTY TAKING PART OF THE ABSOLUTE COMMUNITY OF
• In 1992, she filed two cases for concubinage and legal separation and PROPERTY
liquidation of property. While filing the cases, Shirley learned of • With regard to the nullity of the deed of absolute sale, the SC confirms
Rogelio’s intention of selling the subject property; thus, Shirley its status as null and void.
advised interested buyers – her neighbor and Nobleza – of the • While the TCT only shows Rogelio as the sole owner, respondent was
existing cases. able to prove that she contributed in the payment of the purchase
• Despite the warning, Rogelio sold the subject property including an price of the subject property, affirmed by the RTC and CA in the case
assumption of the existing mortgage to Nobleza for P380, 000.00 for liquidation of property.
without Shirley’s consent. • However, the nullity is not premised on financial contribution. The
• RTC granted the petition for legal separation and ordered the fact that it forms part of their regime of an absolute community of
dissolution and liquidation of the absolute community of property. property makes the sale null and void for a lack of consent from one
Rogelio appealed to the CA, which was denied. spouse.
• Shirley then instituted a Complaint for Rescission of Sale and • Art. 96 of the FC - … In the event that one spouse is incapacitated or
Recovery of Property against petitioner and Rogelio before the RTC otherwise unable to participate in the administration of the common
Marikina, which granted the same. Nobleza appealed to the CA, which properties, the other spouse may assume sole powers of
affirmed the RTC ruling. A motion for reconsideration was filed but administration. These powers do not include the powers of disposition
was denied. Nobleza now files the case in the Supreme Court. or encumbrance without the authority of the court or the written
consent of the other spouse. In the absence of such authority or
Issue: Whether or not the Court of Appeals erred in finding the petitioner consent, the disposition or encumbrance shall be void.
not a purchaser in good faith.
Cusi v. Domingo
Ruling:
Facts:
DEFINITION OF A BUYER IN GOOD FAITH/INNOCENT PURCHASER FOR • The property in dispute is a vacant, unfenced lot consisting of 658 sq.
VALUE m. in Quezon City under a TCT in the name of Lilia Domingo. In 1999,
She found that there were construction activities taking place in her
• Petitioner is not a buyer in good faith. An innocent purchaser for value property without her consent and soon found many transactions
is one who buys the property of another, without notice that some occurring in her property.
other person has a right or interest in the property, for which a full • In 1997, Radelia Sy represented herself as owner of the property and
and fair price is paid by the buyer at the time of the purchase or petitioned the RTC for the issuance of a new owner’s copy of the TCT,
before receipt of any notice of claims or interest of some other person showing a deed of absolute sale made allegedly by Domingo in her
in the property. favor and an affidavit of loss which supposedly contained the
• It is the party who claims to be an innocent purchaser for value who duplicate copy. Such was issued and cancelled in view of the deed of
has the burden of proving such assertion, and it is not enough to sale, so a new one was issued in the name of Sy.
invoke the ordinary presumption of good faith. • Sy subdivided the lot into two and sold each half to Spouses De Vera
• Examples of such prudence could be shown by making an ocular and Cusi. The contracts to sell were annotated on Sy’s TCT, where
inspection, checking the title of ownership with the Register of Deeds the consideration was claimed to be P2M in total when the entire
along with the payment of taxes, the capacity of the seller to dispose property had an actual value of P14M. A TCT was then issued to
the property which necessarily includes an inquiry into the civil status Spouses De Vera and Cusi. Apparently, the construction activities
of the seller to ensure that if married, marital consent is secured. were from the initiative of the De Veras.
• Petitioner argues that she is a buyer in good faith because she has • Domingo filed an action against the De Veras and Cusis seeking for
examined the TCT which was registered in Rogelio’s name alone; annulment of title. RTC ruled that the sale between Domingo and Sy
thus, being an innocent purchaser for value, she is not required to go were void, but the De Veras and Cusi were purchasers in good faith
beyond the face of the title. and for value.
• The SC disagrees. The buyer cannot claim to be an innocent • RTC reconsidered its decision upon motion by Sy and Domingo
purchaser for value by relying solely on the TCT and ignoring the separately, declaring the De Veras and Cusi as purchasers in bad faith
other circumstances. and revalidating Domingo’s title.
• (Spouses Raymundo v. Spouses Bandong) Similarly, the petitioners • The CA affirmed the RTC decision, ruling that the sale conveyed no
also invoked indefeasibility of the Torrens title, stating that they only title to Sy for being forged; therefore, Sy could not acquire the right
needed to look at the face of the title. to convey to the buyers. They could not be considered purchasers in
• “She was the grandniece of Eulalia and resides in the same locality good faith because they knew Sy’s TCT was a reconstituted owner’s
where the latter lives and conducts business, so it is impossible for copy. They were also aware of other facts like the simultaneous
her not to acquire knowledge of the business practice of requiring her transactions and undervaluation of the purchase price. CA denied the
biyhaeros to surrender the titles to their properties and sign the deeds motions for reconsideration.
of sale over the properties in her favor. This should have put her on • Cusi and De Vera now contend that: Sy’s TCT was free of liens or
guard for any abuses that Eulalia may commit with the titles.” encumbrances that could have raised suspicion, went beyond the face
• (Arrofo v. Quiño) The general rule of relying on the title is not of the TCT but did not find anything to doubt the title.
absolute. Arrofo failed to act as a prudent buyer. While she asked her
daughter to verify from the RoD if the property is free from Issue: Whether or not the petitioners are buyers in good faith and for
encumbrances, she admitted that she conducted an ocular inspection value.
and found a house construction but did not inquire about the
occupants. Myrna was also occupying a room in her house as a lessee, Ruling:
but the fact that she was renting a room while selling a land with a • First, the judgment on the nullity of the transfer of property to
house should have put her on guard.` Sy is immutable since it was decided in unanimity by both courts
to the point that Sy no longer came to Court for further review.
NOBLEZA IS NOT A PURCHASER IN GOOD FAITH FOR HAVING PRIOR • With regard to Cusi and De Veras’ contention, the records do not
KNOWLEDGE OF THE EXISTENCE OF A DISPUTE OVER THE SUBJECT support their common contention.
PROPERTY • Generally, one does not need to go behind the certificate of title
because it contains all the information about the title of its holder
• Here, Rogelio described himself as single, but as in Raymundo v. to avoid possible conflicts and dispense with the burdensome
Bandong, the circumstances are also critical in determining good task of inquiring further. The exception is when a person has
faith. actual knowledge of facts and circumstances that would impel a
• Nobleza’s sister, Hilda Bautista, resided near the respondent’s house. reasonably cautious man to make such an inquiry – the
She could have easily checked if Rogelio had the capacity to dispose determination of intent of which is a factual issue.
the subject property. Respondent even testified that she warned them • The petitioners did put effort to determine whether the property
not to buy the property because of the cases she filed against Rogelio. belonged to Sy, finding no encumbrance, but they were not just
• Nobleza denied such warning taking place, arguing that the warning under the obligation to purchase the property in good faith but
could not be construed as notice. However, both courts a quo gave also for value.
Prepared by: Gas

A TCT DERIVED FROM A DUPLICATE OWNER’S COPY FROM A LOSS OF THE that the writ must be modified to include cancellation of derivative
ORIGINAL MANDATES GREATER VIGILANCE titles.
• The RoD found it difficult to implement the cancellation of title over
• The petitioners lacked vigilance as buyers. Showing that the Lot 10 of Block 2 and Lot 8 of Block 8 because no such individual titles
property was unfenced and vacant is not enough, considering exist in his records, claiming that the two lots must still be included
that it would be easy for any registered owner to lose property in the mother title. However, he cannot cancel the mother title since
over illegal occupation. The fact that the TCT was derived from it would affect the other lots included therein.
a duplicate owner’s copy reissued by virtue of loss of the owner’s • Even arguing that he could cancel the mother title specifically for the
copy should have alerted them to suspicion. two lots, he could not issue new titles since the office does not have
• (Barstowe Philippines Corp. v. Republic) “The nature of a information about the technical descriptions over the two lots.
reconstituted TCT of a registered land is similar to that of a • Thus, the RoD requested for a supplemental writ of execution;
second Owner’s Duplicate Transfer Certificate of Title in that however, Judge Fabros denied the petitioners’ motion for
both are issued on the representation that the original was lost supplemental writ of execution.
– a fact that requires more vigilance.”
• (Garcia v. CA) Similar to this situation, the impostor got ahold ARGUMENTS OVER THE WRIT OF EXECUTION
of a TCT through a simulated deed of sale and sold the property
to a transferee (registered owner reflected in the TCT) who • Petitioner argues that: the decision can be enforced against GSIS’s
mortgaged it to Spouses Lazaro who also claimed good faith. transferees pendente lite because they were given notice of the
However, SC ruled against them, claiming that the property was pendency. The notice was even carried out in Dimaguila’s and
a second owner’s duplicate TCT which is in effect, a reconstituted Victorino’s respective titles. As transferees pendente lite, their titles
title. This should have alerted them to make the necessary are proper subjects of the writs of execution, even if they were not
investigation. actual parties to the case. The execution should not be contained only
• The fraud committed in Garcia is similar to this case. They did in the fallo.
not investigate beyond the face of Sy’s TCT despite the • GSIS can no longer raise the issue of exemption since the CA’s
certificate being derived merely from a document akin to a decision on the matter was already affirmed by the SC.
reconstituted TCT. • Basically, petitioners argue against the RoD’s contention, claiming
that the notice of lis pendens was already put in the subsequent titles
SIMULTANEOUS TRANSACTIONS CONCERNING THE TITLE SHOULD HAVE of the buyers, so their titles are proper subjects to the writ of
CAUSED SUSPICION execution.
• Respondent argue that: The petitioners’ motion was properly denied
• Considering the other circumstances, the deed was allegedly for trying to modify a final decision. Considering that the final decision
executed on July 14, 1997, the affidavit executed on July 17, merely ordered cancellation of GSIS’s titles and not the derivative
1997, the petition for issuance of a duplicate copy granted on titles, they can no longer cancel the derivative titles. Furthermore,
August 26, 1997, and on October 31, 1997, a real estate they argue that the inclusion of derivative titles would deprive the
mortgage was executed in favor of Turingan. The simultaneous holders of due process because they are not bound by the judgment,
series of transactions should have put them on guard. being strangers to the action. Finally, GSIS reiterates its argument
on exemption from court processes.
GROSS UNDERVALUATION OF THE PROPERTY SHOULD HAVE PUT THE • Basically, GSIS argues that the denial of the motion for supplemental
BUYERS ON GUARD writ of execution was correct because it would modify a final decision.
Since the final decision was defective for not including derivative
• Another circumstance is the gross undervaluation of the property, titles, the petitioners can no longer do anything to reclaim the titles
priced at P1M when its actual market value was at least P14M. There vested to the buyers. Even if they could, the buyers would be
is no acceptable reason to acquiesce to the fraud. deprived of due process for not being part of the decision.
• While De Vera insists that she did not have any hand in the
undervaluation, considering that Sy was the one who prepared the Issue: (CORE ISSUE) Whether or not a final and executory judgment
deed of sale, they were contracting parties who transacted with full against GSIS and Manlongat can be enforced against holders of derivative
freedom from undue influence from Sy or anyone else. titles.
• While petitioners allege that the sale was nearly P7M for each
property, the argument is devoid of factual basis. The recital of the Ruling:
deeds of sale were controlling on the consideration of the sales. • The issue of GSIS’s exemption was already decided. They can
• The registered owner of realty cannot be deprived of her property no longer invoke the same thing twice.
through fraud, unless a transferee acquires the property as an
innocent purchaser for value. A transferee who acquires the property A TRANSFEREE PENDENTE LITE MUST RESPECT THE OUTCOME OF THE
covered by a reissued owner's copy of the certificate of title without LITIGATION OVER HIS PROPERTY.
taking the ordinary precautions of honest persons in doing business
and examining the records of the proper Registry of Deeds, or who • A notice of lis pendens is an announcement to the whole world that a
fails to pay the full market value of the property is not considered an real property is in litigation. It serves as a warning that one who
innocent purchaser for value. acquires interest over said property does so at his own risk.
• When a transferee pendente lite takes property with notice of lis
pendens, such transferee undertakes to respect the outcome of
Dela Merced v. GSIS and Spouses Victor litigation by the fact of annotation of lis pendens.
• Considering the existence of these entries to the buyers’ titles, it bars
Facts: any defense of good faith. They are merely holders of whatever rights
• The dispute concerns five registered parcels of land in Pasig City. They GSIS might have, which was nothing.
were originally owned by Jose Zulueta. They later mortgaged the lots • The title obtained by the transferee pendente lite affords him no
to GSIS, which eventually foreclosed the mortgaged properties. special protection; he cannot invoke the rights of a purchaser in good
• Dela Merced filed a complaint upon learning of the foreclosure, faith and cannot acquire better rights than those of his predecessor-
praying for the nullity because he was the owner of the lots at the in-interest.
time of foreclosure. He also impleaded the Manlongats who claimed • The Court cannot accept GSIS’s narrow interpretation of the decision
that through a sale by GSIS to their daughter Elizabeth, they were because such would render the decision useless. The inclusion of
able to own one of the foreclosed properties. He argued that GSIS derivative titles in the writ of execution will not alter the decision in
had no ownership right that could be transferred. ordering the cancellation of GSIS’s title.
• He caused an annotation of lis pendens on the TCT. He later died and
was substituted by his heirs, the petitioners in this case. CANCELLATION OF TITLE MUST BE CARRIED OUT, REGARDLESS OF
• After a series of trials, a decision was rendered in favor of Dela WHETHER IT STEMS FROM A MOTHER TITLE OR NOT
Merced. However, the motion for execution could not be carried out
because of the objections raised by the Register of Deeds and GSIS. • Regarding the cancellation of title, it doesn’t matter whether or not
the titles are individual or contained in the mother title. The RoD has
GSIS ARGUES AGAINST EXECUTION SINCE IT IS EXEMPTED FROM to carry out their cancellation. If it requires GSIS or the Bureau of
EXECUTION OVER ITS PROPERTIES Lands to provide the necessary information, they can be compelled.
• Otherwise, the Court's decision would be rendered inefficacious, and
• GSIS opposed the motion for execution because RA 8291 (GSIS Act GSIS would retain ostensible ownership over the lots by the simple
of 1997) exempts GSIS funds and properties from execution, among expedience that they are included in a mother title, instead of
others. individual titles. That result is manifestly contrary to the Court's ruling
• GSIS filed with CA a petition for certiorari and prohibition against the and would subvert the very purpose of bringing this case for a
implementation of the writ of execution. The CA dismissed the complete resolution.
petition, stating that GSIS never validly acquired ownership over the • When the judgment calls for the issuance of a new title for the winning
subject properties; thus, any rights that GSIS may have had over the party, it also follows that the losing party surrender its title for
properties were non-existent from the beginning. cancellation. Petitioners can obtain a court order requiring the
• GSIS filed a motion for reconsideration which was denied. They also registered owner to surrender the same and directing the entry of a
filed an appeal to the SC, but it was also denied. new certificate of title in petitioners' favor. The trial court should have
granted petitioners' motion for supplemental writ of execution as it
REGISTER OF DEEDS ARGUES AGAINST EXECUTION FOR INADEQUACY OF had authority to issue the necessary orders to aid the execution of
THE WRIT’S DECISION AND NON-EXISTENCE OF OTHER TITLES the final judgment.
• The Register of Deeds of Pasig City argued that he could not enforce Saberon vs Ventanilla
the decision to cancel the titles since GSIS no longer had titles over
the two lots. They already conveyed it in 1985 and 1988 to Bartolome Principle: Registration is the operative act that conveys ownership or
and Dimaguila (Lot 7 and 8 of Block 2), the lot of Bartolome being affects the land insofar as third persons are concerned. Registration is
titled under the name of his assignee Victorino. Thus, the RoD claims constructive notice to third persons.
Prepared by: Gas

FACTS: On March 11, 1992, MRCI registered a deed of absolute sale to Marquez
who eventually sold the same property to the Saberons, which conveyance
History of the case: was registered in July 1992.
• Manila Remnant Co., Inc. (MRCI) was the petitioner, being the
owner of several parcels of land situated in Quezon City, constituting ROD Cleofe opined that a judicial order for the cancellation of the titles in
the subdivision known as Capitol Homes Subdivision Nos. I and II. the name of the Saberons was essential before he complied with the writ
• On July 25, 1972, MRCI entered into a contract with A.U. Valencia & of execution in Civil Case No. 26411
Co. Inc. (AUVC) entitled "Confirmation of Land Development and
Sales Contract,"the latter was to develop the aforesaid subdivision CIVIL Case
with authority to manage the sales thereof. • Once again, the Ventanillas were constrained to go to court to seek
• MRCI and AUVC executed two (2) contracts to sell covering Lots 1 the annulment of the deed of sale executed between MRCI and
and 2 of Block 17,in favor of the Ventanillas, for the combined Marquez as well as the deed of sale between Marquez and the
contract price of ₱66,571.00 payable monthly for ten (10) years. The Saberons, as the fruits of void conveyances.
Ventanillas paid the down payment as stipulated in the two (2) • Saberons relied on one central argument—that they were purchasers
contracts. in good faith, having relied on the correctness of the certificates of
• On March 13, 1970, Valencia, president of MRCI, and without the title covering the lots in question; and therefore, holders of a valid
knowledge of the Ventanillas, resold the same property to Carlos and indefeasible title.
Crisostomo • The Marquez Contract to Sell was in fact the third in a row, and
• All the amounts paid by the latter were deposited in Valencia’s bank registered a year later, on May 21, 1991, appears as the first recorded
account and remitted to MRCI as payments of Crisostomo. The entry in MRCI’s titles.
Ventanillas continued to pay the monthly installment. • The notice of levy in Civil Case No. 26411 came ten days later, on
• MRCI terminated its business relationship with AUVC on account of May 31, 1991. Then, in February 1992, MRCI executed a deed of
irregularities discovered in its collection and remittances.. Valencia absolute sale to Marquez and when the new titles were issued
was in Marquez’ name, the notice of levy was not carried over.
• It was not until March 1978 when the Ventanillas discovered • The said parties were found guilty of bad faith for selling the lots to
Valencia’s deception. Believing that they had already remitted the Marquez at a time when litigation as to the validity of the first sale to
total amount of ₱73,122.35 for the two lots, the Ventanillas offered the Ventanillas was still pending
to pay the balance to MRCI. To their shock, their names as lot buyers
did not appear in MRCI’s records.
• MRCI showed them a copy of the contract to sell signed by Valencia,
Present Petition- The main issue
in favor of Crisostomo. MRCI refused the Ventanillas’ offer to pay for
• Saberon filed the present petition
the remainder of the contract price.
• They were purchasers in good faith and for value.
• The Ventanillas commenced an action for specific performance,
• Before purchasing the lots, they exercised due diligence and found no
annulment of deeds and damages against MRCI, AUVC.
encumbrance or annotations on the titles. They had no notice of any
• On November 17, 1980, the CFI Quezon City rendered a decision
defect, irregularity or encumbrance in the titles of the property they
declaring the contracts to sell in favor of the Ventanillas as valid
purchased.
and subsisting, and annulling the contract to sell in favor of
• They claimed that in 1992, a certain Tiks Bautista offered the lots to
Crisostomo.
Raul Saberon, who, after being given photocopies of the titles to the
• The CFI Quezon City ruled further that if for any reason the transfer
land, inquired with the Registry of Deeds for Quezon City (ROD-QC)
of the lots could not be effected, MRCI, AUVC and Crisostomo would
to verify the authenticity of the same. He found no encumbrances
be solidarily liable to the Ventanillas for the reimbursement of the
or annotations on the said titles, other than restrictions for
sum of ₱73,122.35, representing the amount they paid for the two
construction and negotiation.
(2) lots, and the legal interest thereon from March 1970, plus the
• He then paid Marquez the amount of Two Million One Hundred
decreed damages and attorney's fees.
Thousand Pesos (₱2,100,000.00) as purchase price for the lots.
• Marquez executed the Deed of Absolute Sale in favor of the Saberons.
The 1990 case
• The ROD-QC then issued TCT Nos. 63140 and 63141 in their names.
• MRCI then filed before this Court a petition for certiorari.
• It was only upon receipt of the summons in the case filed by the
• SC i affirmed the decision of the CA and declared the judgment of the
Ventanillas with the RTC that they learned of the present controversy.
CFI Quezon City immediately executory.
• The claim of the Ventanillas over the subject properties never ripened
• The Ventanillas moved for the issuance of a writ of execution in
into ownership as they failed to consign the balance on the purchase
Civil Case No. 26411. The writ was issued on May 3, 1991, and served
price stipulated on the contracts to sell, thus preventing the
upon MRCI on May 9, 1991. A notice of levy was annotated in the
obligatory force of the contract from taking effect.
titles of MRCI on May 31, 1991.
• The Court is beckoned to rule on two conflicting rights over the
• However, the subject properties could not longer be delivered
subject properties: the right of the Ventanillas to acquire the title to
to the Ventanillas because they had already been sold to
the registered land from the moment of inscription of the notice of
Samuel Marquez (Marquez) on February 7, 1990
levy on the day book (or entry book), on one hand; and the right of
The 1994 case the Saberons to rely on what appears on the certificate of title for
purposes of voluntary dealings with the same parcel of land, on the
MRCI
• Argued that the sale of the properties to Marquez was valid because other.
at the time of the sale, the issue of the validity of the sale to the
ISSUE: Whether or not the registration of the notice of levy had produced
Ventanillas had not yet been resolved.
• There was no specific injunction against it re-selling the property. constructive notice that would bind third persons despite the failure of the
ROD-QC to annotate the same in the certificates of title?
• As a buyer in good faith, Marquez had a right to rely on the recitals
in the certificate of title.
RULING: YES!
• The subject matter of the controversy having been passed to an
innocent purchaser for value.
• No bad faith can be ascribed to the parties alike. The Saberons
VENTILLAS could not be said to have authored the entanglement they found
themselves in. No fault can be attributed to them for relying on
• The validity of the sale to them had already been established even
the face of the title presented by Marquez.
while the previous petition was still awaiting resolution.
• However, MRCI’s transaction with Marquez "cannot prevail over
• The petition only questioned the solidary liability of MRCI to the
the final and executory judgment ordering MRCI to execute an
Ventanillas.
• The portion of the decision ordering MRCI to execute an absolute deed absolute deed of sale in favor of the Ventanillas." Considering
that the deed of sale in favor of Marquez was of later
of sale in their favor had already become final and executory.
• Marquez didn’t protect nor assert his righ over the disputed land. registration, the notice of levy should have been carried over to
the title as a senior encumbrance.
• The alleged sale to him was merely a ploy of MRCI to evade the
execution of the absolute deed of sale in their favor. • A levy of a judgment debtor creates a lien, which nothing can
subsequently destroy except the very dissolution of the
Court’s Decision attachment of the levy itself. Prior registration of the lien creates
a preference, since the act of registration is the operative act to
The validity of the contract to sell in favor of the Ventanilla spouses is not
convey and affect the land.
disputed by the parties
First, the contract to sell in favor of Marquez was entered into after the • Thus, the court ruled on the superiority of the Ventanillas’ notice
of levy and the constructive notice against the whole world which
lapse of almost ten years from the rendition of the judgment of the trial
court upholding the sale to the Ventanillas. it had produced and which effectively bound third persons
including the Saberons.
Second, the petitioner did not invoke the contract with Marquez during
the hearing on the motion for the issuance of the writ of execution filed by
• Verily, the controversy at hand arose not from the
Ventanillas’ fault, but from ROD Cleofe’s misplaced
the private respondents. It disclosed the contract only after the writ of
execution had been served upon it. understanding of his duty under the law.
• In cases of voluntary registration of documents, an innocent
Third, in its manifestation and motion dated December 21, 1990, the
purchaser for value of registered land becomes the registered
petitioner said it was ready to deliver the titles to the Ventanillas provided
that their counterclaims against private respondents were paid or offset owner, and, in contemplation of law the holder of a certificate of
title, the moment he presents and files a duly notarized and valid
first.
Fourth, Marquez has not intervened in any of these proceedings to assert deed of sale and the same is entered in the day book and at the
same time he surrenders or presents the owner's duplicate
and protect his rights to the subject property as an alleged purchaser in
good faith. certificate of title covering the land sold and pays the registration
fees, because what remains to be done lies not within his power
Even if it be assumed that the contract to sell in favor of Marquez
is valid, it cannot prevail over the final and executory judgment to perform.The Register of Deeds is duty bound to perform
it.
ordering MRCI to execute an absolute deed of sale in favor of the • In cases of involuntary registration, an entry thereof in the
Ventanillas.
day book is a sufficient notice to all persons even if the owner's
duplicate certificate of title is not presented to the register of
Prepared by: Gas

deeds. Therefore, in the registration of an attachment, • Yap later learned that Garcia had also demolished the house on the
levy upon execution, notice of lis pendens, and the like, property and advertised the construction and sale of "Trans American
the entry thereof in the day book is a sufficient notice to Townhouse V" thereon.
all persons of such adverse claim. • Garcia failed to pay the balance of the purchase price as agreed upon.
• The fact that the notice of levy on attachment was not annotated • However, the last two (2) checks given by Garcia as payment ,
on the original title on file in the Registry of Deeds, which amounting to ₱400,000 each, were dishonored for the reason of
resulted in its non-annotation on the title TCT No. PT-94912, "DAIF" or drawn against insufficient funds.
should not prejudice petitioner. • Yap wrote a letter dated December 26, 1988 to Garcia informing him
• As long as the requisites required by law in order to effect that the two (2) checks were dishonored and asking that the checks
attachment are complied with and the appropriate fees duly be replaced within five (5) days from receipt of the letter. Such
paid, attachment is duly perfected. The attachment already request was left unheeded.
binds the land. This is because what remains to be done lies not • On January 10, 1989, Yap informed Garcia in a letter that she and
within the petitioner’s power to perform but is a duty incumbent Vicente were rescinding the Agreement while demanding the return
solely on the Register of Deeds. There is effective registration of the original owner’s copy of TCT 156254.
once the registrant has fulfilled all that is needed of him for • Thus, Garcia effectively refused to return the documents and to
purposes of entry and annotation, so that what is left to be vacate the subject property.
accomplished lies solely on the Register of Deeds. • On February 19, 1989, Yap and Vicente discovered that Garcia posted
• The notice of levy covering the subject property was annotated an advertisement in the classified ads of the Manila Bulletin
in the entry book of the ROD QC prior to the issuance of a TCT offering to sell units at the Trans American Townhouse V
in the name of the Saberons. situated at the subject property.
• Clearly, the Ventanillas’ levy was placed on record prior to the • Thus, on February 27, 1989, Atty. Yap wrote the Housing and Land
sale. Use Regulatory Board (HLURB) informing the latter of the existing
• Nevertheless, the equal footing of the parties necessarily public advertisement of TSEI offering for sale townhouses illegally
tilts in favor of the superiority of the Ventanillas’ notice constructed on the subject property and urging the HLURB to cancel
of levy, as discussed. any existing permit or license to sell the said townhouse unitsor to
deny any application therefor.
Contract to Sell Issue • On March 17, 1989, the HLURB issued a Cease and Desist
• The Court also sees no reason to dwell in the contention that the Order19 (CDO) enjoining TSEI and Garcia from further developing and
rights or interests of the Ventanillas in the subject properties selling the townhouses.
never ripened into ownership. It bears stressing that the • Garcia and TSEI have not been issued any permit by said Board for
previous decisions discussed herein already sealed the validity the townhouse Project on the subject lot.
of the contract to sell issued to the Ventanillas decades ago. • Undeterred, TSEI continued its construction and selling activities for
the townhouses. Thus, the HLURB issued an Order dated June 1,
Laches 198924 fining TSEI in the amount of ₱10,000.
• The attribution of laches against the Ventanillas is flawed. • Yap also wrote a letter dated April 3, 1989 to the Register of Deeds
• While the Ventanillas may have been unaware that in Quezon City informing it that TCT 156254 was no longer in their
improvements were being erected over the lots, this possession and requesting that the office clear the matter with them
obliviousness can, by no means, be treated as a lack of vigilance first before acting on any transaction pertaining to the subject
on their part. Considering the length of litigation which they had property.
to endure in order to assert their right over the property which • Yap and Vicente, , filed a Complaint dated February 14, 1990 for the
they have painstakingly paid for decades ago. rescission of contract, restitution and damages with prayer for
TRO/preliminary injunction against TSEI and Garcia, docketed as Civil
Builder in Good faith Case No. Q-90-4690.
• The Court finds the Saberons to be builders in good faith. • Garcia managed to cause the cancellation of TCT 156254 and
• No less than the court a quo observed that "no actual evidence that its replacement with TCT 383697 in the name of TSEI.
the Saberons connived with the MRCI and Marquez to have the titles However, bore the date of issuance as June 9, 1988,way
registered in their names to the prejudice of the (Ventanillas)" and before the parties agreed on the sale sometime in October
that what was obvious was that "the Saberons dealt with clean 1988.
certificates of titles." • Garcia apparently used TCT 383697 to entice several buyers to buy
the townhouse units being constructed by TSEI on the subject lot.
• Claiming to have bought townhouse units sometime in early 1989,
SHORTER VERSION: ONLY ABOUT THE MAIN ISSUE the following intervened in the instant case: the spouses Jose and
Visitacion Caminas (Caminas), Reynaldo V. Maniwang (Maniwang),
Facts: The Ventanillas sought the recovery of two parcels of land which Generoso C. Tulagan (Tulagan), Varied Traders Concept, Inc. (VTCI),
the vendors, MRCI and AUVC, sold to another party. The Ventanillas and Arturo Marquez (Marquez). TSEI left the townhouse units
caused the attachment of a notice of levy covering the subject property unfinished, leaving these intervenors to finish their townhouses by
and was annotated in the entry book of the RD of QC. MRCI dealt the same themselves.
property to Marquez, however, the notice of levy was not carried over to • The intervenors Caminas, Maniwang, Tulagan, and Marquez
Marquez’s title. Marquez subsequently sold the property to the Saberons. asserted that they were all shown TCT 383697 in the name of
The Saberons filed a case on one central argument—that they were TSEI but nevertheless signed their respective contracts with
purchasers in good faith, having relied on the correctness of the certificates TSEI indicating the subject property as covered by TCT
of title covering the lots in question. Admittedly, the notice of levy covering 156254. Subsequently, they all got a photocopy of TCT 383697 and
the subject property was annotated in the entry book of the verified the same with the Registry of Deeds of Quezon City, which
RD of QC prior to the issuance of a TCT in the name of the Saberons. confirmed that the title was clean
• On the other hand, only the Absolute Deed of Sale in favor of VTCI,
Issue: Did the notice on levy annotated in the entry book of the RD of QC dated October 30, 1987, reflected that the property sold was covered
serve as constructive notice to the Saberons? by TCT 383697.
• Far East Bank and Trust Company (FEBTC) now BPI entered into
Held: No bad faith can be ascribed to the parties alike. Nevertheless, the a Loan Agreement 44 dated May 22, 1989 with TSEI secured by a
equal footing of the parties necessarily tilts in favor of the superiority of Real Estate Mortgage over TCT 156254. Garcia purportedly explained
the Ventanillas' notice of levy. The fact that the notice of levy on to FEBTC that the parties were still in the process of transferring the
attachment was not annotated on the original title on file in the RD, which title.
resulted in its non-annotation on the title of Marquez should not prejudice • Afterwards, Garcia submitted a copy of TCT 383697 in TSEI’s name.
petitioner. As long as the requisites required by law in order to effect Upon default, FEBTC foreclosed the subject lot and had the
attachment are complied with and the appropriate fees duly paid, Foreclosure Certificate of Sale annotated on TCT 383697.
attachment is duly perfected. What remained to be done was not within
the Ventanillas’ power to perform but was a duty incumbent solely on the RTC
RD. Clearly, the Ventanillas’ levy was placed on record prior to the sale. • The Sanchezes have the right to rescind the Agreement they entered
This shows the superiority and preference in rights of the Ventanillas over into with Garcia and TSEI under proviso no. 6 of the Agreement.
the property as against the Saberons. • The Agreement is in the nature of a contract to sell, the ownership
over the subject property remained with the Sanchezes as the
BPI vs Sanchez suspensive condition––that the check payments shall be honored––
was not complied with.
Facts: • Thus, the RTC concluded that there was not even any need for
• Vicente Victor C. Sanchez (Vicente), Kenneth Nereo Sanchez and rescission in this case.
Imelda C. V da. De Sanchez owned a parcel of land located at Quezon • TSEI and Garcia were builders in bad faith as the Sanchezes never
City consisting of 900 square meters. The property was registered consented to the construction of the townhouses.
under Transfer Certificate of Title No. (TCT) 156254. • the presentation by Garcia and TSEI to the intervenors of TCT
• On October 10, 1988, Jesus V. Garcia (Garcia), doing business under 383697 in TSEI’s name sufficiently shows their bad faith.
the name Trans American Sales and Exposition, Inc. (TSEI) offered • Anent the rights of intervenors, the RTC found the Sanchezes to have
to buy the Subject Property for ₱1,800,000 under certain conditions. a better right over the subject property..
• On October 1988, Felisa Yap (Yap), the widow of Kenneth Nereo
Sanchez, and Garcia agreed to the sale of the subject property. CA
Pursuant to this agreement, Yap turned over to Garcia the • Affirmed the RTC’s decision with modifications.
original owner’s copy of TCT 156254, the copy of the filed • The Register of Deeds of Quezon City is hereby directed to cancel the
Application for Restitution of Title to the property, and copies of all TCT 383697 in TSEI’s name and the reinstatement of TCT 156254 in
receipts for the payment of real estate taxes on the property,while the names of the Sanchezes.
Garcia paid Yap 50,000 as earnest money. • Sanchezes equally in bad faith with TSEI and Garcia
• Garcia, without Yap’s knowledge and consent, took possession of the • They blame on the Sanchezes and argue that there was negligence
lot and installed his own caretaker thereon with strict instructions not on the latter’s part when they turned over the owner’s original
to allow anyone to enter the property.
Prepared by: Gas

duplicate copy of TCT 156254 despite receiving only the ₱50,000 SECOND
earnest money. • Garcia and TSEI stopped the construction of the townhouses on March
• Sanchezes were also negligent for surrendering possession of the 30, l989 pursuant to the CDO of the HLURB despite the non-
subject property to Garcia and TSEI, and for failing to stop the completion of the townhouses, VTCI still fully paid the uniform
construction of the townhouses on the subject property. price of ₱700,000 for the townhouse on each of the 3 lots
RULING: THIRD
• With the CDO and the warnings to the public and prospective buyers
The Sanchezes are not guilty of negligence published in the Philippine Daily Inquirer on April 16, 1989 and in the
• Garcia committed himself he would personally undertake the Manila Bulletin on April 19, 2014, VTCI should have been aware of
preparation and execution of the Extrajudicial Settlement with the irregularities in the proposed sale of townhouses by Garcia and
Sale as well as the reconstitution of the original copy of TCT No. TSEI.
156254 on file with the Register of Deeds of Quezon City.
• Thus, it was inevitably for plaintiff-appellant/appellee Felisa Yap d. BPI cannot be considered a mortgagee in good faith
to surrender to defendant Garcia the owner’s duplicate copy of • Considering that Garcia/TSEI were already selling the townhouse
the aforesaid title as well as the other documents pertinent for units to the public as early as January 1989, FEBTC was remiss in not
such documentation and reconstitution. requiring Garcia/TSEI to submit a written approval from the HLSURB
• The surrender was purely to comply with and in pursuance to for the mortgage of the subject property where the townhouse units
their earlier agreement with the defendants. were being constructed as required
• The purported issuance of TCT 383697 was made more than six (6)
POSSESSION: months before Garcia/TSEI approached the bank for the loan. Thus,
• The records would disclose that the plaintiffs FEBTC should have been placed on guard as to why Garcia/TSEI
appellants/appellees did not voluntarily surrender possession initially gave it TCT 156254 in the name of the Sanchezes when TCTC
thereof to defendants. 383697 was purportedly already issued and in Garcia’s possession
• It was defendant Garcia who took possession of the subject way before the bank loan was negotiated.
property, without plaintiffs-appellants/appellees knowledge.
Rescission of the Agreement was not barred by the subsequent
The Sanchezes did not act in bad faith transfer
• There is bad faith on the part of the landowner whenever the act • Failure of TSEI to pay the consideration for the sale of the subject
was done with his knowledge and without opposition on his part. property entitled the Sanchezes to rescind the Agreement.
• Sanchezes did take action to oppose the construction on their • And in view of the finding that the intervenors acted in bad faith in
property by writing the HLURB and the City Building Official of purchasing the property, the subsequent transfer in their favor did
Quezon City. As a result, the HLURB issued two (2) Cease and not and cannot bar rescission.
Desist Orders and several directives against Garcia/TSEI which,
however, were left unheeded. Home Bankers Savings vs CA
Garcia, TSEI, BPI, and the intervenors acted in bad faith Principle: The one who mortgaged the property must be the absolute
a. Garcia and TSEI acted in bad faith owner of the property. With respect to banks, they have to go beyond
• They knew for a fact that the property still belonged to the the title and exercise extraordinary diligence.
Sanchezes and yet proceeded to build the townhouses not just
without the authority of the landowners, but also against their Facts: Each of private respondents namely, entered into separate
will. contracts to sell with TransAmerican through the latter's Owner/General
Manager, Engr.
b. Intervenors Sps. Caminas, Maniwang, Tulagan, and Marquez acted in Jesus Garcia, involving certain portions of land. On May 30, 1989, Engr.
bad faith (IMPORTANT) Garcia and his wife obtained a loan from petitioner Home Bankers
• All persons dealing with property covered by a torrens certificate without the prior approval of the HLURB and mortgaged eight lots as
of title are not required to go beyond what appears on the face collateral. Home Bankers registered its mortgage on these titles without
of the title. any other encumbrance or lien annotated therein. However, five out of
• Exception:Where the purchaser or mortgagee has knowledge of these eight titles turned out to be private respondents' townhouses
a defect or lack of title in the vendor, or that he was aware subject of the contracts to sell with TransAmerican. Home Bankers
ofsufficient facts to induce a reasonably prudent man to inquire eventually foreclosed the mortgage, and a sheriff’s certificate of sale in
into the status of the property in litigation its favor was annotated on the titles of the subject lots.
• One who buys property withfull knowledge of the flaws
and defects in the title of the vendor is enough proof of Issue: Whether the mortgage was valid and enforceable against
his bad faith and estopped from claiming that he acquired respondents.
the property in good faith against the owners
The factual milieu of the case reveals that intervenors are buyers in bad Held: No, the mortagege was null and void. Garcia was not the absolute
faith for the following reasons, owner of the subject parcels. Moeover, Home Bankers cannot be innocent
• They admitted that they executed either contracts of sale or purchasers because judicial notice can be taken of the uniform practice of
contracts to sell indicating that the lot is covered by TCT No. banks to investigate, examine and assess the real estate offered as
156254 registered under the name of the respondent security for the application of a loan. We cannot overemphasize the fact
Sanchezes. that the Bank cannot barefacedly argue that simply because the title or
• The fact that the lot being sold to them belonged to persons titles offered as security were clean of any encumbrances or lien, that it
other than TSEI or Garcia should have driven the intervenors, was thereby relieved of taking any other step to verify the over-reaching
as prudence would dictate, to investigate the true status of the implications should the subdivision be auctioned on foreclosure.
property.
• The intervenors should havebeen suspicious of the explanation
of Garcia that TCT No. 383697, reflecting TSEI as the owner of D. Morgagee in Good Faith
the property, has been burned and that he is in the process of
reconstituting the title. Before signing the contract of sale or Ruiz vs Dimailig
contract to sell, they should have asked Garcia where the
reconstitution case has been filed or is pending and proceeded • Respondent Bernardo F. Dimailig (Bernardo) was the registered
to verify with the said court the status of the reconstitution. owner of a parcel of land covered by TCT No. T-361747 located in
• The intervenors knew that they were buying a townhouse over Alapan, Imus, Cavite.
a subdivision lot from TSEI and Garcia. Such being the case, • In October 1997, he entrusted the owner’s copy of the said TCT to his
they should have verified with the HLURB whether said project brother, Jovannie, who in turn gave the title to Editha Sanggalang
is registered with said housing agency and if a license to sell has (Editha), a broker, for its intended sale.
been issued to TSEI or Garcia. • However, in January 1998, the property was mortgaged to Evelyn V.
Ruiz (Evelyn) as evidenced by a Deed of REM without Bernardo’s
VCTI acted in bad faith knowledge and consent.
FIRST • Hence, Bernardo instituted this suit for annulment of the Deed of
• VTCI has not shown that it verified with the RD if the alleged TCT REM.
383697 of respondent TSEI is valid and genuine. • Evelyn insisted that she is a mortgagee in good faith & for value.
• It should be remembered that the duplicate certificate of TCT 156254 • She met Jovannie when she inspected the subject property and
was lost and subject of reconstitution. Yet respondents Garcia and assured her that Bernardo owned the property and his title thereto
TSEI were not able to show that it was already reconstituted. In was genuine.
addition, there was no deed of absolute sale executed by the • The REM cannot be annulled and that she had the right to keep the
Sanchezes in favor of TSEI as the latter failed to pay the last two (2) owner's copy of TCT No. T-3617 4 7 until the loan was fully paid to
installments and subsequently, the agreement to sell was rescinded her.
by the Sanchezes for non-payment. • BERNARDO testified that when he went abroad on October 19, 1997,
• There being no deed of absolute sale, there is, consequently, no he left the owner's copy of the TCT of the subject property to Jovannie
ground for the RD to cancel TCT No. 156254 and subsequently issue as they intended to sell the subject property.
TCT 383697 in the name of TSEI. • He argued that his alleged signature appearing therein was merely
• This goes to show that TCT 383697 of TSEI appears to be forged as he was still abroad at that time.
spurious and a fake title. • When he learned in September or November 1998 that Editha
• This is buttressed by the fact that the date of the issuance of TCT mortgaged the subject property, be personally told Evelyn that the
383697 is June 9, l988, pre-dating the execution of the Agreement REM was fake and demanded the return of his title. Not heeding his
between the Sanchezes and TSEI on December 8, l988. request, he filed a complaint for estafa through falsification of public
• With the failure of VTCI to exert earnest efforts to verify the document against Editha and Evelyn, The criminal case against
authenticity of TCT 383697, then it is not a purchaser in good Evelyn was dismissed while Editha was found guilty as charged.
faith.
Prepared by: Gas

• JOVANNIE testified that Editha convinced him to surrender the • Evelyn hastily granted the loan and entered into the mortgage
owner's copy of TCT No. T-361747 which she would show her buyer. contract
• Editha informed him that she misplaced the title • Where the mortgagee acted with haste in granting the loan, without
• EDITHA said a certain Parani, introduced himself as "Bernardo", first determining the ownership of the property being mortgaged, the
mortgaged the subject property to her for ₱300,000.00 payable mortgagee cannot be considered as an innocent mortgagee in good
within a period of three months. She asserted that even after the faith.
expiration of said period, "Bernardo" failed to pay the loan. E. Sale Involving Real Estate
• Before accepting the mortgage they inspected the land but she only
stayed in the vehicle as she was still recuperating from an operation. TO BE ENFORCEABLE:
She admitted that she neither verified from the neighborhood the ART. 1358, NCC xxx [s]ales of real property or of an interest therein are
owner of the property nor approached the occupant thereof. The governed by Articles 1403, No. 2 and 1405. xxx
person who introduced himself as Bernardo presented a community Art. 1403 (2) – xxx In the following cases, an agreement hereafter made
tax certificate and his picture as proof of identity. She admitted that shall be unenforceable by action, unless the same, or some note or
she did not ask for any identification card from "Bernardo. memorandum thereof be in writing, and subscribed by the party charged,
or by his agent; evidence, therefore, of the agreement cannot be received
RTC: Evelyn was a mortgagee in good faith because she was unaware that without the writing, or a secondary evidence of its contents xxx
the person who represented himself as Bernardo was an impostor.
Evelyn caused the verification of the title of the property with the RD and TO BE REGISTRABLE
found the same to be free from any lien or encumbrance. Evelyn also ART. 1358, NCC – The following must appear in a public document:
inspected the property and met Jovannie during such inspection.
(1) Acts and contract which have for their object the creation,
CA: The "innocent purchaser (mortgagor in this case) for value protected transmission, modification or extinguishment of real rights over immovable
by law is one who purchases a titled land by virtue of a deed executed by property xxx GSIS and subject to whatever rights GSIS might have in the
the registered owner himself, not by a forged deed. subject properties, which (as it turns out) is none at all. What Dimaguila
Since the Deed of REM was forged, and the title to the subject property is and Victorino possess are derivative titles of the GSIS's over the subject
still in the name of the rightful owner, and the mortgagor is a different parcels, which this Court has finally adjudicated to be null and void.
person who only pretended to be the owner, then Evelyn cannot seek
protection from the cloak of the principle of mortgagee in good faith.
Esguerra vs Trinidad
Issue: WON EVELYN IS A MORTGAGEE IN GOOD FAITH
FACTS:
RULING: No. The mortgage contract was forged as it was entered into by
Evelyn with an impostor, the registered owner of the property, Bernardo, Sale of immovable made for a lump sum and not at the rate of a certain
correspondingly did not lose his title thereon, and Evelyn did not acquire sum for a unit of measure or number, there shall be no increase or
any right or title on the property and cannot invoke that she is a mortgagee decrease of the price, although there be a greater or less areas or number
in good faith and for value than that stated in the contract.
RULE 45: The issue of whether a person is a mortgagee in good faith is FACTS:
not within the ambit of a Rule 45 Petition. The determination of presence
or absence of good faith, and of negligence are factual matters, which are  Felipe Esguerra and Praxedes de Vera (Esguerra spouses) were the
outside the scope of a petition for review on certiorari. owners of several parcels of land in Camalig, Meycauayan, Bulacan —
Exception: When there is a different or conflicting factual findings among them a 35,284-square meter parcel of land covered by Tax
between the RTC and CA, such as in this case. Declaration No. 10374 and a 23,989-square meter parcel of land
covered by Tax Declaration No. 12080.
MORTGAGEE IN GOOD FAITH:  [Tax Dec 10374] Half of it (17,642 square meters) they sold to their
• Evelyn cannot invoke the protection given to a mortgagee in grandchildren, herein petitioners Feliciano, Canuto, Justa, Angel,
good faith. Fidela, Clara and Pedro, all surnamed Esguerra.
• No valid mortgage will arise unless the mortgagor has a valid  [Tax Dec 12080] 23,489 square meters of which they also sold to
title or ownership over the mortgaged property. petitioners, and the remaining 500 square meters they sold to their
• Such doctrine of mortgagee in good faith presupposes other grandchildren, the brothers Eulalio and Julian Trinidad
"that the mortgagor, who is not the rightful owner of the (Trinidad brothers).
property, has already succeeded in obtaining a Torrens  Also sold to the Trinidad brothers were a 7,048-square meter parcel
title over the property in his name and that, after of land covered by Tax Declaration No. 9059, a 4,618-square meter
obtaining the said title, he succeeds in mortgaging the parcel of land covered by Tax Declaration No. 12081, and a 768-square
property to another who relies on what appears on the meter parcel of land covered by Tax Declaration No. 13989.
said title."  The Esguerra spouses executed the necessary Deed of Sale in favor of
• In order for a mortgagee to invoke the doctrine of mortgagee in petitioners on August 11, 1937, 1 and that in favor of the Trinidad
good faith, the impostor must have succeeded in obtaining a brothers on August 17, 1937. 2 Both documents were executed before
Torrens title in his name and thereafter in mortgaging the notary public Maximo Abaño.
property. Where the mortgagor is an impostor who only  [IMPORTANT FACTS] Eulalio Trinidad later sold his share of the
pretended to be the registered owner, and acting on such land to his daughters-respondents herein, via a notarized Kasulatan
pretense, mortgaged the property to another, the mortgagor ng Bilihang Tuluyan ng Lupa 3 dated October 13, 1965. A portion of
evidently did not succeed in having the property titled in his or the land consisting of 1,693 square meters was later assigned Lot No.
her name, and the mortgagee cannot rely on such pretense as 3593 during a cadastral survey conducted in the late 1960s. On
what appears on the title is not the impostor's name but that of respondents' application for registration of title OCT No. 0-3631 was
the registered owner. issued in their name.
• In the case at hand, the title to the subject property remained  Meanwhile, on November 10, 1958, petitioners sold to respondents'
registered in the name of Bernardo. It was not transferred to the parents Eulalio Trinidad and Damiana Rodeadilla (Trinidad spouses) a
impostor's name when Evelyn transacted with the latter. Hence, portion of about 5,000 square meters of the 23,489-square meter of
the principle of mortgagee in good faith finds no application; land which they previously acquired from the Esguerra spouses. During
correspondingly, Evelyn cannot not seek refuge therefrom. the same cadastral survey conducted in the late 1960s, it was
discovered that the about 5,000-square meter portion of petitioners'
FORGED DOCUMENT: parcel of land sold to the Trinidad spouses which was assigned Lot No.
3591 actually measured 6,268 square meters. In a subsequent
• During pre-trial, both parties agreed that it was not Bernardo application for registration of title over Lot No. 3591 OCT No. 0-6498
who signed as the mortgagor in the Deed of REM. was issued in the name of Trinidad.
• It was only an impostor - representing himself as Bernardo -
who mortgaged the property. Petitioners fault the appellate court:
• This impostor is not only without rightful ownership on the 1. . . . in misappreciating the fact that the act of the respondent Eulalio
mortgaged property, he also has no Torrens title in his own Trinidad in acquiring the property from Felipe Esguerra constituted fraud.
name involving said property. Based on the testimony of Appellant Pedro Esguerra that he does not know
• Simply put, for being a forged instrument, the Deed of REM is a how appellees were able to secure a title over the lot in question and that
nullity and conveys no title they never sold Lot No. 3593 to Virginia Trinidad since it is part of the
whole lot of 23,489 square meters.
Evelyn did not take the necessary steps to determine any defect in
the title of the alleged owner of the mortgaged property. 2. . . . in the [i]nterpretation and application of the provisions of Article
• '"Bernardo" introduced himself to Evelyn as the owner of the 1542 of the New Civil Code.
property, he did not present any proof of identification.
• To recall, he only exhibited his community tax certificate and a picture ISSUE: WON there is fraud [Not important and not discussed
when he introduced himself to Evelyn. thoroughly in the case] & WON Article 1542 of Civil Code can apply
• Evelyn also ignored the fact that "Bernardo'' did not participate in the in this case because of the discrepancy of the Area of Lot 3593 sold.
negotiations/transactions leading to the execution of the Deed of [topic]
REM. Notably, no power of attorney was given to Editha who
supposedly transacted in behalf of Bernardo. RULING:
• Evelyn likewise failed to ascertain the supposed title of "Bernardo"  No. The said testimony is a mere conclusion on the part of appellants.
over the property, Evelyn admitted that during the ocular inspection, On the other hand, the evidence shows that appellees acquired title
she remained in the vehicle. She did not inquire from the subject over the subject property by virtue of a deed of sale executed by their
property's occupant or from the occupants of the surrounding father Eulalio Trinidad in their favor.
properties if they knew "Bernardo" and whether or not he owned the  Under the Torrens System, an OCT enjoys a presumption of validity,
subject property. which correlatively carries a strong presumption that the provisions of
the law governing the registration of land which led to its issuance
Prepared by: Gas

have been duly followed. Fraud being a serious charge, it must be specific boundaries stated in the contract must
supported by clear and convincing proof. Petitioners failed to discharge control over any statement with respect to the area
the burden of proof, however. contained within its boundaries. It is not of vital
consequence that a deed or contract of sale of land
1. No. It is clear from the afore-quoted Bilihan ng Lupa that what should disclose the area with mathematical
appellants sold to Eulalio was the "bahaging palayan." Though accuracy. It is sufficient if its extent is objectively
measured as 5,000 square meters, more or less, such indicated with sufficient precision to enable one to
measurement is only an approximation, and not an exact identify it. An error as to the superficial area is
measurement. Moreover, we take note of the fact that the said immaterial. Thus, the obligation of the vendor is to
deed of sale mentioned the boundaries covering the whole area deliver everything within the boundaries, inasmuch
of 33,489 square meters, including the "bahaging palayan." Had as it is the entirety thereof that distinguishes the
appellants intended to sell only a portion of the "bahaging determinate object. 28 (Emphasis and
palayan," they could have stated the specific area in the deed of underscoring supplied)
sale and not the entire "bahaging palayan"
 A caveat is in order, however. The use of "more or less" or similar
Most importantly, the circumstances attendant to the inclusion words in designating quantity covers only a reasonable excess or
of the excess area bare nothing atypical or significant to hint at deficiency.
unreasonableness. It must be noted that the land was not yet  In OCT No. 0-6498, the increase by a fourth of a fraction of the
technically surveyed at the time of the sale. As vendors who area indicated in the deed of sale cannot be considered as an
themselves executed the Bilihan ng Lupa, petitioners may rightly unreasonable excess.
be presumed to have acquired a good estimate of the value and  The complaints were also time-barred, noted that when the complaints
area of the bahaging palayan. were filed in 1994, more than 27 years had elapsed from the issuance
of OCT No. 0-3631 and more than 20 years from the issuance of OCT
 On the questioned interpretation and application by the appellate court No. 0-6498. The prescriptive period of one (1) year had thus set in.
of Article 1542 of the Civil Code reading:
Arcaina vs. Ingram

In the sale of real estate, made for a lump
sum and not at the rate of a certain sum for a unit Facts:
of measure or number, there shall be no increase
or decrease of the price, although there be a  Arcaina is the owner of a parcel of land. Her attorney-in-fact,
greater or less areas or number than that stated in Banta, entered into a contract with Ingram for the sale of the
the contract. property. Banta represented that the property has an area of
more or less 6,200 aquare meters (sq.m.) per the tax
The same rule shall be applied when two or more declaration covering it. The contract price was ₱1,860,000.00,
immovables are sold for a single price; but if, with Ingram making installment payments for the property.
besides mentioning the boundaries, which is Ingram still had an obligation to pay the remaining balance in
indispensable in every conveyance of real estate, the amount of ₱145,000.00.
its area or number should be designated in the  Subsequently, Ingram caused the property to be surveyed and
contract, the vendor shall be bound to deliver all discovered that the lot has an area of 12,000 sq. m. Upon
that is included within said boundaries, even when learning of the actual area of the property, Banta allegedly
it exceeds the area or number specified in the insisted that the difference of 5,800 sq. m. remains unsold. This
contract; and, should he not be able to do so, he was opposed by Ingram who claims that she owns the whole lot
shall suffer a reduction in the price, in proportion to by virtue of the sale; he then instituted the recovery case.
what is lacking in the area or number, unless the  The Municipal Circuit Trial Court (MCTC) dismissed the complaint
contract is rescinded because the vendee does not and declared that, for Ingram to be awarded the excess 5,800
accede to the failure to deliver what has been sq. m. portion of the property, she should have presented
stipulated. (Emphasis and underscoring supplied). evidence that she paid for the surplus area consistent with
Article 1540 of the Civil Code.
In sales involving real estate, the parties may  The Regional Trial Court (RTC) reversed and set aside the Order
choose between two types of pricing agreement: of the MCTC. The RTC found that neither of the parties presented
a unitprice contract wherein the purchase price is competent evidence to prove the property’s actual area. Hence,
determined by way of reference to a stated rate per the RTC concluded that the area of the lot as shown by the
unit area (e.g., P1,000 per square meter), or boundaries indicated in the deeds of sale is only 6,200 sq. m.
a lump sum contract which states a full purchase more or less. In addition, the RTC held that Article 1542, which
price for an immovable the area of which may be covers sale of real estate in lump sum, applies in this case.
declared based on an estimate or where both the Having apparently sold the entire lot for a lump sum, Arcaina,
area and boundaries are stated (e.g., P1 million for as the vendor, is obligated to deliver all the land included in the
1,000 square meters, etc.). In Rudolf Lietz, Inc. v. boundaries of the property, regardless of whether the real area
Court of Appeals, the Court discussed the should be greater or smaller than what is recited in the deeds of
distinction: sale.
 The Court of Appeals (CA) agreed with the RTC that the sale was
. . . In a unit price contract, the statement of area made for a lump sum and not on a per-square-meter basis. The
of immovable is not conclusive and the price may CA explained that in case of conflict between the area and the
be reduced or increased depending on the area boundaries of a land subject of the sale, the vendor is obliged to
actually delivered. If the vendor delivers less than deliver to the vendee everything within the boundaries. This is
the area agreed upon, the vendee may oblige the in consonance with Article 1542 of the Civil Code. Petitioners
vendor to deliver all that may be stated in the now assail the CA’ s declaration that the sale of the property was
contract or demand for the proportionate reduction made for a lump sum.
of the purchase price if delivery is not possible. If  Petitioners insist that they sold the property on a per-square-
the vendor delivers more than the area stated in meter basis, at the rate of ₱300.00 per sq. m. Since the sale
the contract, the vendee has the option to accept was on a per-square-meter basis, petitioners argue that it is
only the amount agreed upon or to accept the Article 1539, and not Article 1542 of the Civil Code, which
whole area, provided he pays for the additional area governs.
at the contract rate.
Issue: Is the sale in this case a sale for a lump sum?
xxx xxx xxx If this is a sale for a lump sum, should the excess area then be
awarded to Respondents?
In the case where the area of the immovable is
stated in the contract based on an estimate, the
Ruling:
actual area delivered may not measure up exactly
with the area stated in the contract. According to
 Yes. In Del Prado v. Spouses Caballero, we were confronted with
Article 1542 of the Civil Code, in the sale of real
facts analogous to the present petition. Pending the issuance of the
estate, made for a lump sum and not at the rate of
Original Certificate of Title (OCT) in their name, Spouses Caballero sold
a certain sum for a unit of measure or number,
a parcel of land to Del Prado. The contract of sale stated both the
there shall be no increase or decrease of the price,
property’s boundaries and estimated area of more or less 4,000 sq. m.
although there be a greater or less areas or number
 Later, when the OCT was issued, the technical description of the
than that stated in the contract. . . .
property appeared to be 14,457 sq. m., more or less. Del Prado alleged
xxx xxx xxx that Spouses Caballero were bound to deliver all that was included in
the boundaries of the land since the sale was made for a lump sum.
Where both the area and the boundaries of the Although, we agreed with Del Prado that the sale partakes of the
immovable are declared, the area covered nature of a lump sum contract, we did not apply Article 1542. In
within the boundaries of the immovable holding that Del Prado is entitled only to the area stated in the contract
prevails over the stated area. In cases of conflict of sale, we explained:
between areas and boundaries, it is the latter which  The Court, however, clarified that the rule laid down in Article 1542 is
should prevail. What really defines a piece of not hard and fast and admits of an exception. It held:
ground is not the area, calculated with more or  “A caveat is in order, however. The use of “more or less” or similar
less certainty, mentioned in its description, but the words in designating quantity covers only a reasonable excess or
boundaries therein laid down, as enclosing the deficiency. A vendee of land sold in gross or with the description “more
land and indicating its limits. In a contract of sale or less” with reference to its area does not thereby ipso facto take all
of land in a mass, it is well established that the risk of quantity in the land.
Prepared by: Gas

 In a contract of sale of land in a mass, the specific boundaries stated petitioner and her predecessor-in-interest. Petitioner further assails the
in the contract must control over any other statement, with respect to ruling of the CA that PNB, who was the buyer in the foreclosure sale,
the area contained within its boundaries. became the absolute owner of the property purchased when it
 Black’s Law Dictionary defines the phrase “more or less” to mean: consolidated its ownership thereof for failure of the mortgagor Lim to
 “About; substantially; or approximately; implying that both parties redeem the subject property during the period of one year after the
assume the risk of any ordinary discrepancy. The words are intended registration of the sale.
to cover slight or unimportant inaccuracies in quantity, Carter v. Finch,
186 Ark. 954, 57 S.W.2d 408; and are ordinarily to be interpreted as The Court finds petitioner's arguments untenable.
taking care of unsubstantial differences or differences of small The Court's ruling in Manuel R. Dulay Enterprises, Inc. v.
importance compared to the whole number of items transferred.”
Court of Appeals 26 is instructive, to wit:
 In a lump sum contract, a vendor is generally obligated to deliver all
the land covered within the boundaries, regardless of whether the real Under Article 1498 of the New Civil Code, the mere
area should be greater or smaller than that recited in the deed. execution of the deed of sale in a public document
However, in case there is conflict between the area actually covered is equivalent to the delivery of the property.
by the boundaries and the estimated area stated in the contract of Likewise, this Court had held that:
sale, he/she shall do so only when the excess or deficiency between
the former and the latter is reasonable. It is settled that the buyer in a
 Applying Del Prado to the case before us, we find that the difference foreclosure sale becomes the absolute
of 5,800 sq. m. is too substantial to be considered reasonable. owner of the property purchased if it is
 Further, at the time of the sale, Ingram and petitioners did not have not redeemed during the period of one
knowledge of the actual area of the land within the boundaries of the year after the registration of the sale. As
property. It is undisputed that before the survey, the parties relied on such, he is entitled to the possession of
the tax declaration covering the lot, which merely stated that it the said property and can demand it at
measures more or less 6,200 sq. m. Thus, when petitioners offered any time following the consolidation of
the property for sale and when Ingram accepted the offer, the object ownership in his name and the issuance
of their consent or meeting of the minds is only a 6,200 sq. m. to him of a new transfer certificate of
property. title. The buyer can, in fact, demand
possession of the land even during the
redemption period except that he has to
Agatep vs. Rodriguez post a bond in accordance with Section 7
of Act No. 3133, as amended. No such
FACTS: bond is required after the redemption
period if the property is not redeemed.
The subject property was previously owned by herein Possession of the land then becomes an
respondent Natalia Aguinaldo Vda. de Lim. On July 18, 1975, Lim absolute right of the purchaser as
mortgaged the lot to the Philippine National Bank (PNB). Lim was not confirmed owner. aSIHcT
able to pay her loan prompting PNB to foreclose the property. As a
consequence, TCT No. T-10759 in the name of Lim was canceled Therefore, prior physical delivery or possession is
and a new certificate of title (TCT No. T-65894) was issued in the not legally required since the execution of the Deed
name of PNB on November 8, 1985. 6 of Sale is deemed equivalent to delivery.
Meanwhile, on August 18, 1976, while the mortgage was This ruling was reiterated in Spouses Sabio v. The
still in effect, Lim sold the subject property to herein petitioner's International Corporate Bank, Inc. 28 wherein it was held that:
husband, Isaac Agatep (Agatep). However, the sale was not
registered. Neither did Lim deliver the title to petitioner or her Notwithstanding the presence of illegal occupants
husband. Nonetheless, Agatep took possession of the same, fenced it on the subject property, transfer of ownership by
with barbed wire and introduced improvements thereon. symbolic delivery under Article 1498 can still be
effected through the execution of the deed of
In July 1992, the subject lot was included among PNB's conveyance. As we held in Power Commercial and
acquired assets for sale. Later on, an invitation to bid was duly Industrial Corp. v. Court of Appeals [274 SCRA 597,
published. On April 20, 1993, the disputed parcel of land was sold to 610], the key word is control, not possession, of
herein respondent Roberta L. Rodriguez (Rodriguez), who is the the subject property. Considering that the deed of
daughter of respondent Lim. Subsequently, TCT No. T-65894, in the conveyance proposed by respondents did not
name of PNB, was canceled and a new title (TCT No. T-89400) was stipulate or infer that petitioners could not exercise
issued in the name of Rodriguez. control over said property, delivery can be effected
On January 27, 1995, herein petitioner filed a through the mere execution of said deed.
Complaint for "reconveyance and/or damages" with the RTC of
. . . It is sufficient that there are no legal
Aparri, Cagayan against herein respondents.
impediments to prevent petitioners from gaining
Later, the complaint was amended to implead PNB as a physical possession of the subject property. As
party-defendant. stated above, prior physical delivery or possession
is not legally required and the execution of the deed
of sale or conveyance is deemed equivalent to
ISSUE: delivery. This deed operates as a formal or symbolic
1. WON PNB is in good faith in registering the land delivery of the property sold and authorizes the
2. WON PNB did not acquire ownership over the disputed lot buyer or transferee to use the document as proof
because the said property was not delivered to it. of ownership. Nothing more is required. 29
3. WON Agatep is bound to recognize and respect the mortgage
entered by Lim to PNB. Thus, the execution of the Deed of Sale in favor of PNB,
after the expiration of the redemption period, is deemed equivalent
RULING: to delivery.
1. Yes. PNB is innocent.
Petitioner insists that PNB is not a mortgagee in good faith asserting

that, if it only exercised due diligence, it would have found out that 3. Yes.
petitioner and her husband were already in adverse possession of the As buyers or transferees, petitioner and her husband
subject property as early as two years before the same was sold to
simply stepped into the shoes of Lim, who, prior to selling the subject
them. This claim, however, is contradicted by no less than petitioner's property to them, mortgaged the same to PNB. As Lim's successors-
averments in her Brief filed with the CA wherein she stated that
in-interest, their possession could not be said to be adverse to that
"[i]mmediately after the sale, the land was delivered to Isaac Agatep . of Lim. Thus, they are also bound to recognize and respect the
. . Since that time up to the present, Isaac Agatep and after his death,
mortgage entered into by the latter. Their possession of the disputed
the Appellant have been in continuous, uninterrupted, adverse and lot could not, therefore, be considered as a legal impediment which
public possession of the said parcel of land". 24 The foregoing assertion could prevent PNB from acquiring ownership and possession thereof.
only shows that petitioner's husband took possession of the subject lot
only after the same was sold to him. It bears to reiterate the undisputed fact, in the instant case,
that Lim mortgaged the subject property to PNB prior to selling the
In any case, the Court finds no error in the findings of both the RTC and
same to petitioner's husband. Settled is the rule that a mortgage is
the CA that PNB is indeed an innocent mortgagee for value. When an accessory contract intended to secure the performance of the
the lots were mortgaged to PNB by Lim, the titles thereto were in the
principal obligation. One of its (mortgage) characteristics is that it is
latter's name, and they showed neither vice nor infirmity. In accepting the inseparable from the property. It adheres to the property regardless
mortgage, PNB was not required to make any further investigation of the
of who its owner may subsequently be. 30
titles to the properties being given as security, and could rely entirely on
what was stated in the aforesaid title. The public interest in upholding the This is true even in the case of a real estate mortgage
indefeasibility of a certificate of title, as evidence of the lawful ownership because, pursuant to Article 2126 of the Civil Code, the mortgage
of the land or of any encumbrance thereon, protects a buyer or mortgagee directly and immediately subjects the property upon which it is
who, in good faith, relies upon what appears on the face of the certificate imposed, whoever the possessor may be, to the fulfillment of the
of title. obligation for whose security it was constituted. It is inseparable from
the property mortgaged as it is a right in rem — a lien on the property
2. No, PNB acquired ownership. whoever its owner may be. It subsists notwithstanding a change in
ownership; in short, the personality of the owner is disregarded.
Petitioner asserts that the execution of a public document does not
Thus, all subsequent purchasers must respect the mortgage whether
constitute sufficient delivery to PNB, considering that the subject
property is in the adverse possession, under claim of ownership, of
Prepared by: Gas

the transfer to them be with or without the consent of the mortgagee, The owner's duplicate copy of TCT No. 76496 in the name of Capistrano
for such mortgage until discharged follows the property. had always been in his possession since he gave Scott only a photocopy
thereof pursuant to the latter's authority to look for a buyer of the
F. Sale by Co-heir Before Partition property. On the other hand, the Jamilars were able to acquire a new
owner's duplicate copy thereof by filing an affidavit of loss and a petition
for the issuance of another owner's duplicate copy of TCT No. 76496. The
minimum requirement of a good faith buyer is that the vendee of the
Alejandrino vs. Ca real property should at least see the owner's duplicate copy of the title
(and not a PHOTOCOPY).
FACTS:
Facts:
 The late spouses Alejandrino left their six children named Marcelino,
Gregorio, Ciriaco, Mauricia, Laurencia and Abundio a lot in Cebu City.  Sometime in 1980, Scott approached respondent Capistrano and
 Upon the death of the spouses, the property should have been divided offered her services to help him sell his 13,785 square meters of land
among their children, however, the estate of the Alejandrino spouses covered by Transfer Certificate of Title (TCT) No. 76496. Capistrano
was not settled in accordance with the procedures. gave her a temporary authority to sell which expired without any sale
 Petitioner Mauricia (one of the children) allegedly purchased portion of transaction being made.
the lots from her brothers, Gregorio’s, Ciriaco’s and Abundio’s share.  To his shock, he discovered later that TCT No. 76496, which was in his
 It turned out, however, that a third party named Nique, the private name, had already been cancelled on June 24, 1992 and a new one,
respondent in this case, also purchased portions of the property from TCT No. 249959, issued over the same property on the same date to
Laurencia, Abundio and Marcelino. Jamilar. TCT No. 249959 likewise had already been cancelled and
 However, Laurencia (the alleged seller to Nique) later questioned the replaced by three (3) TCTs (Nos. 251524, 251525, and 251526), all in
sale in an action for quieting of title and damages. the names of the Jamilar spouses. TCT Nos. 251524 and 251526 had
 The trial court (Quieting of title case) ruled in favor of Nique and also been cancelled and replaced by TCT Nos. 262286 and 262287
declared him the owner of the lots. Laurencia appealed the decision to issued to Golpeo and Tan, respectively.
the Court of Appeals but later withdrew the same.  Thus, the action for reconveyance filed by Capistrano, alleging that his
 Nique filed a motion for the segregation of the portion of the property and his wife's signatures on the purported deed of absolute sale in
that had been declared by the trial court (Quieting of title case) as his favor of Scott were forgeries; that the owner's duplicate copy of TCT
own by virtue of purchase. No. 76496 in his name had always been in his possession; and that
 The trial court segregated the property on the basis of the Extra- Scott, the Jamilar spouses, Golpeo, and Tan were not innocent
Judicial Settlement between Mauricia and Laurencia. purchasers for value because they all participated in defrauding him of
his property.
ISSUE: Whether or not partition of the lot was validly made?  Ruling of the RTC and CA – in favor of Capistrano
RULING: Note:
 Yes, although the right of an heir over the property of the Capistrano to Scott; Scott to Jamilars; Jamilars to Gilturas; Jamilars and
decedent is inchoate as long as the estate has not been fully Gilturas to Golpeo and Tan
settled and partitioned, the law allows a co-owner to exercise Capistrano – Scott – Jamilars– Golpeo and Tan
rights of ownership over such inchoate right.
 Laurencia was within her hereditary rights in selling her pro Issue: WON the buyers of the property are buyers in good faith
indiviso share. The legality of Laurencia’s alienation of portions
of the estate of the Alejandrino spouses was upheld in the Ruling:
Quieting of title case which had become final and executory by
Laurencia’s withdrawal of her appeal in the CA.  No. First. The purported sale of the property from Capistrano to Scott
 When Nique filed a motion for the segregation of the portions of was a forgery, and resort to a handwriting expert was not even
the property that were adjudged in his favor, he was in effect necessary as the specimen signature submitted by Capistrano during
calling for the partition of the property. Under the law, partition trial showed marked variance from that found in the deed of absolute
of the estate of a decedent may only be effected by: sale. In the same token, the deed of sale between Scott and the
Jamilars was also forged, as it noted the stark differences between the
(1) the heirs themselves extra-judicially; signatures of Scott in the deed of sale and those in her handwritten
(2) by the court in an ordinary action for partition, or in the letters to Capistrano.
course of administration proceedings;  Second. The Jamilar spouses should have known that the signatures
(3) by the testator himself; and of Scott and Capistrano were forgeries due to the patent variance of
(4) by the third person designated by the testator. the signatures in the two deeds of sale shown to them by Scott, when
Scott presented to them the deeds of sale, one allegedly executed by
 Extrajudicial settlement between Mauricia and Laurentia became Capistrano in her favor covering his property.
the basis for the segregation of the property in favor of Nique.  The CA also correctly found the Gilturas not innocent purchasers for
However, evidence on the extrajudicial settlement of estate was value, because they failed to check the veracity of the allegation of
offered before the trial court and it became the basis for the Jamilar that he acquired the property from Capistrano.
order for segregation of the property sold to Nique.  In ruling that Sy was not an innocent purchaser for value. Sy knew
 Mauricia does not deny the fact of the execution of the deed of that the title to the property was still in the name of Capistrano, but
extrajudicial settlement of the estate. She only questions its failed to verify the claim of the Jamilar spouses regarding the transfer
validity on account of the absence of notarization of the of ownership of the property by asking for the copies of the deeds of
document and the non-publication thereof. absolute sale between Capistrano and Scott, and between Scott and
Jamilar. Sy should have likewise inquired why the Gilturas had to affix
A partition is valid though not contained in a public instrument. their conformity to the contract to sell by asking for a copy of the deed
of sale between the Jamilars and the Gilturas. Had Sy done so, he
 Moreover, the execution of the deed of extrajudicial settlement would have learned that the Jamilars claimed that they purchased the
of the estate reflected the intention of both Laurencia and property from Capistrano and not from Scott.
Mauricia to physically divide the property.  [IMPORTANT] Minimum requirement of a good faith buyer The owner's
 Both of them had acquired the shares of their brothers and duplicate copy of TCT No. 76496 in the name of Capistrano had always
therefore it was only the two of them that needed to settle the been in his possession since he gave Scott only a photocopy thereof
estate. The fact that the document was not notarized is no pursuant to the latter's authority to look for a buyer of the property.
hindrance to its effectivity as regards the two of them. The On the other hand, the Jamilars were able to acquire a new owner's
partition of inherited property need not be embodied in a public duplicate copy thereof by filing an affidavit of loss and a petition for
document to be valid between the parties. the issuance of another owner's duplicate copy of TCT No. 76496. The
minimum requirement of a good faith buyer is that the vendee of
G. Caveat Emptor Principle the real property should at least see the owner's duplicate copy of the
title (and not a PHOTOCOPY).
The rule of caveat emptor requires the purchaser to be aware of the
supposed title of the vendor and one who buys without checking the Domingo Realty vs. CA
vendor’s title takes all the risks and losses consequent to such failure.
Facts:
HOW TO CONDUCT DUE DILIGENCE VERIFICATION OF TITLE:  On November 19, 1981, petitioner Domingo Realty filed a complaint
1. Verify the origin, history, authenticity and validity of the title with against Antonio Acero, conducting business under the name A.M. Acero
the Trading, Victorio, and the Does for recovery of possession of three
2. Register of Deeds and Land Registration Authority parcels of land in Metro Manila. Acero constructed a factory building
3. Engage the services of a competent and reliable geodetic for manufacture of hollow blocks.
engineer to verify the boundary, metes and bounds of the lot  The respondents filed their answer (Acero and Victorio), claiming
that Acero merely leased the land from Victorio who claimed to
subject of said title based on the technical description in the said
own the property where the factory stood. Victorio assailed the
title and the approved survey plan in the Land Management TCTs of Domingo Realty, stating that they came from spurious deeds of
Bureau sale and that he has been in possession for more than 70 years.
4. Conduct an actual ocular inspection  (AGREEMENT IMPORTANT) Yu presenting Domingo Realty executed
5. Inquire from the owners and possessors of adjoining lots with a compromise agreement with Acero and Luis Dy, stipulating
respect to the true and legal ownership of the lot in question that the Realty’s ownership is recognized, Dy’s title is not
genuine, Acero’s property is encroaching on a portion of
Domingo Realty’s property and shall deliver the property to the
Sy v. Capistrano Jr Realty, Dy bought the property in good faith and waives all
claims. RTC Pasay approved the Compromise Agreement.
[IMPORTANT] Minimum requirement of a good faith buyer
Prepared by: Gas

 In order to implement the decision, Domingo Realty asked the trial court correct. Whether it is only a portion or the entire lot Acero is leasing that
to conduct a re-survey which was granted. will be affected by the agreement is of no importance.
 Acero filed a Motion to Nullify the Compromise Agreement, stating
that the resurvey plan as basis of the resurvey would violate the ACERO CANNOT CLAIM MISTAKE BECAUSE HE WAS ALREADY
Compromise Agreement since the whole area he occupied would be AWARE OF HIS ENCROACHMENT; IT WAS HIS OWN UNDOING FOR
the realty firm’s property. So, Acero filed a Motion to Resurvey SIGNING INTO THE COMPROMISE AGREEMENT WITHOUT FULLY
claiming that the parties agreed on re-survey by the Bureau of KNOWING THE CONSEQUENCES
Lands which was approved, directing the Director of Lands to conduct
a re-survey. Elpidio Lara, Chief of Technical Services Division of the  No. Although Articles 2038 and 1330 of the Civil Code allow a party to a
Lands Management Section of NCR -DENR, stated in his report that contract, on the ground of mistake, to nullify the agreement. Article 1333
Domingo Realty’s TCTs covered the land occupied by the hollow of the Civil Code also provides that "there is no mistake if the party
block factory. alleging it knew the doubt, contingency or risk affecting the object
 Ayala Steel Manufacturing Co. Inc. filed a Motion for Substitution, of the contract."
stating that it purchased the subject lots, which was opposed by Acero  Prior to the execution of the Compromise Agreement, respondent Acero
claiming that the case was already terminated by the was already aware of the technical description of the titled lots of
compromise agreement, so substitution is no longer necessary; petitioner Domingo Realty and more so, of the boundaries and area of
however, it was never resolved. This explains why Domingo Realty and the lot he leased from David Victorio.
Ayala Steel are co-petitioners.  Before consenting to the agreement, he could have simply hired a
 The trial court ordered Acero to conduct his own re-survey and geodetic engineer to conduct a verification survey and determine
have it approved by the Bureau of Lands, resulting from his the actual encroachment of the area he was leasing on the titled
contention that he occupied only 2,000 sq. m. of the disputed property. lot of petitioner Domingo Realty. Had he undertaken such a
He had Engr. Cruz do it, but the plan was rejected for failure to comply precautionary measure, he would have known that the entire area he was
with requirements. occupying intruded into the titled lot of petitioners and possibly, he would
 (Non-Important Motions) Domingo Realty filed a Manifestation with not have signed the agreement.
Motion praying for denial of the motion to nullify, which was granted.  In this factual milieu, respondent Acero could have easily averted the
Subsequently, a motion for execution was filed. The respondent stated alleged mistake in the contract; but through palpable neglect, he
that the Compromise Agreement was only as to the land occupied by failed to undertake the measures expected of a person of ordinary
respondent, being approximately 2,000 sq. m. He claimed that the order prudence. Without doubt, this kind of mistake cannot be resorted to by
modified the agreement, stating it involved only 1, 357 sq. m., not the respondent Acero as a ground to nullify an otherwise clear, legal, and valid
entire lot – if not amended, it will result in unjust enrichment. agreement, even though the document may become adverse and even
Meanwhile, the writ of execution was approved. Gutted by fire however, ruinous to his business.
the records were reconstituted, so the trial court reordered a writ of  Moreover, respondent failed to state in the Compromise Agreement
execution. that he intended to vacate only a portion of the property he was
 (Important) Respondent filed a Manifestation and Compliance, alleging leasing. Such provision being beneficial to respondent, he, in the exercise
that the Survey Plan was approved by the RD of DENR, so he moved for of the proper diligence required, should have made sure that such matter
annulment of the writ of execution. was specified in the Compromise Agreement. Respondent Acero's failure
 (TRIAL COURT RULING) They issued an order directing Bureau of to have the said stipulation incorporated in the Compromise Agreement is
Lands Director to determine which of the two were correct. Regional negligence on his part and insufficient to abrogate said agreement.
Technical Director Almazan of the LRA cancelled Acero’s version of
the plan and approved Domingo Realty’s as the real plan. CAVEAT EMPTOR PRINCIPLE ENUNCIATED
 (CA RULING) Respondent did not seek annulment of judgment but  We have no power to make or alter contracts in order to save him from
reiterated that under the Compromise Agreement, he would only vacate the adverse stipulations in the Compromise Agreement. Hopefully this
a portion of the property he was occupying. CA granted the petition case will serve as a precaution to prospective parties to a contract
and set aside RTC’s order, sustaining Acero’s contention. involving titled lands for them to exercise the diligence of a
reasonably prudent person by undertaking measures to ensure the
(TO SIMPLIFY) Basically, there are 3 main parties: Domingo legality of the title and the accurate metes and bounds of the lot embraced
Realty, Acero, and Victorio. Domingo Realty owns the TCTs, Acero in the title. It is advisable that such parties:
has a construction on one of those lots, and Victorio claims that the
lot is actually his being leased to Acero. Domingo and Acero came (1) verify the origin, history, authenticity, and validity of the title with the
into a compromise agreement, among which stated that Acero Office of the Register of Deeds and the Land Registration Authority.
accedes to the ownership of the Realty which part of Acero’s (2) engage the services of a competent and reliable geodetic engineer to
property encroached upon. They agreed to have it re-surveyed, but verify the boundary, metes, and bounds of the lot subject of said title based
they had a conflict regarding the resurvey. This turned out into two on the technical description in the said title and the approved survey plan
versions of the plan from Acero’s and the Realty’s engineers. RTC in the Land Management Bureau;
ruled that the Realty’s plan was correct, but all Acero really wanted (3) conduct an actual ocular inspection of the lot;
was to recognize the fact that he was only to vacate a PORTION of (4) inquire from the owners and possessors of adjoining lots with respect
his property, not the entirety of it according to his interpretation to the true and legal ownership of the lot in question;
of the compromise agreement - which CA granted. (5) put up signs that said lot is being purchased, leased, or encumbered;
and
Issue: (6) undertake such other measures to make the general public aware that
1. WON Victorio, not being a party to the Compromise Agreement, can said lot will be subject to alienation, lease, or encumbrance by the parties.
assail the validity of the Compromise Agreement as not binding upon  Respondent Acero, for all his woes, may have a legal recourse against
him and give rise to another suit. lessor David Victorio who inveigled him to lease the lot which turned out
2. WON the Compromise Agreement is vague as there is still a need to to be owned by another.
determine the exact metes and bounds of the encroachment on the
petitioners' lot. Locsin v. Hizon
3. WON the compromise judgment can be set aside on the ground of
mistake because respondent Acero gave his consent to the Facts:
Compromise Agreement in good faith that he would only vacate a  Locsin was the registered owner of a 760-sq.m. lot covered by Transfer
portion of his lot in favor of petitioner Domingo Realty (MOST Certificate of Title (TCT) No. 235094, located at Quezon City. In 1992, she
IMPORTANT). filed an ejectment case, ] against one Billy Aceron (Aceron) before the MTC
to recover possession over the land in issue.
Ruling:  Eventually, the two entered into a compromise agreement, Locsin
A THIRD-PARTY CAN ASSAIL THE VALIDITY OF A COMPROMISE later went to the United States without knowing whether Aceron has
AGREEMENT; LEGAL EFFECT ONLY PERTAINS TO BINDING complied with his part of the bargain under the compromise agreement.
NATURE In spite of her absence, however, she continued to pay the real property
taxes on the subject lot.
 Yes. The only legal effect of the non-inclusion of a party in a  In 1994, after discovering that her copy of TCT No. 235094 was missing,
compromise agreement is that said party cannot be bound by the Locsin filed a petition for administrative reconstruction in order to
terms of the agreement. The Compromise Agreement shall however be secure a new one, TCT No. RT-97467. Sometime in early 2002, she then
"valid and binding as to the parties who signed thereto.” requested her counsel to check the status of the subject lot. It was then
that they discovered:
THE OBJECT NEED NOT BE SPECIFIC; REQUIRES ONLY THAT THE
OBJECT IS DETERMINABLE 1. One Marylou Bolos (Bolos) had TCT No. RT-97467 cancelled on February
11, 1999, and then secured a new one, TCT No. N-200074, in her favor by
 No. The object of a contract, in order to be considered as "certain," need registering a Deed of Absolute Sale dated November 3, 1979 allegedly
not specify such object with absolute certainty. It is enough that the executed by Locsin with the Registry of Deeds;
object is determinable in order for it to be considered as "certain." 2. Bolos later sold the subject lot to Bernardo Hizon (Bernardo) for PhP 1.5
Article 1349 provides this. million, but it was titled under Carlos Hizon's (Carlos') name on August 12,
 In the instant case, the title over the subject property contains a 1999. Carlos is Bernardo's son;
technical description that provides the metes and bounds of the 3. On October 1, 1999, Bernardo, claiming to be the owner of the property,
property of petitioners. Such technical description is the final filed a Motion for Issuance of Writ of Execution for the enforcement of the
determinant of the extent of the property of petitioners. Thus, the area court-approved compromise agreement in Civil Case No. 38-6633; (SIGN
of petitioners' property is determinable based on the technical OF BAD FAITH – READ RULING NO 2)
descriptions contained in the TCTs. 4. The property was already occupied and was, in fact, up for sale.
 Findings of fact by administrative agencies, having acquired  On May 9, 2002, Locsin, through counsel, sent Carlos a letter
expertise in their field of specialization, must be given great requesting the return of the property since her signature in the
weight by this Court. Even if the exact area of encroachment is not purported deed of sale in favor of Bolos was a forgery. In a letter-
specified in the agreement, it can still be determined from the technical reply dated May 20, 2002, Carlos denied Locsin's request, claiming that he
description of the title of plaintiff which defendant Acero admitted to be was unaware of any defect or flaw in Bolos' title and he is, thus, an
innocent purchaser for value and good faith.
Prepared by: Gas

 On June 13, 2002, Bernardo met with Locsin's counsel and discussed  There is a lack of evidence to support the respondent spouses' position
the possibility of a compromise. He ended the meeting with a promise that the sale was a bona fide transaction. Even if we repeatedly sift
to come up with a win-win situation for his son and Locsin, a promise which through the evidence on record, still we cannot find any document,
turned out to be deceitful, for, on July 15, 2002, Locsin learned that contract, or deed evidencing the sale in favor of the spouses
Carlos had already sold the property for PhP 1.5 million to his sister Guevara. The same goes for the purported payment of the purchase price
and her husband, herein respondents Lourdes and Jose Manuel Guevara of the property in the amount of PhP 1.5 million in favor of Carlos.
(spouses Guevara), respectively, who, as early as May 24, 2002, had a  The transfer from Carlos to the spouses Guevara was effected only
new certificate of title, TCT No. N-237083, issued in their names. The fifteen (15) days after Locsin demanded the surrender of the
spouses Guevara then immediately mortgaged the said property to property from Carlos.
secure a PhP 2.5 million loan/credit facility with Damar Credit Corporation  When Bernardo met with Locsin's counsel on June 13, 2002, and personally
(DCC). made a commitment to come up with a win-win situation for his son and
 SUMMARY: Locsin Aceron – Bolos – Carlos (via Bernardo) – Sps Locsin, he knew fully well, too, that the property had already been
Guevara purportedly transferred to his daughter and son-in-law, the
spouses Guevara, for he, no less, facilitated the same. This, to us, is
Issue: Whether or not due diligence was made; Whether or not glaring evidence of bad faith and an apparent intention to mislead
Carlos/Sps. Guevarra is a buyer in good faith. Locsin into believing that she could no longer recover the subject property.
Ruling:  Also, the fact that Lourdes Guevara and Carlos are siblings, and that
PRECAUTIONARY MEASURES IN DETERMINATION OF GOOD Carlos' agent in his dealings concerning the property is his own father,
FAITH; CAVEAT EMPTOR PRINCIPLE renders incredible the argument that Lourdes had no knowledge
 An innocent purchaser for value is one who buys the property of whatsoever of Locsin's claim of ownership at the time of the
another without notice that some other person has a right to or purported sale.
interest in it, and who pays a full and fair price at the time of the purchase  The fact that the spouses Guevara never intended to be the owner in good
or before receiving any notice of another person's claim. As such, a faith and for value of the lot is further made manifest by their lack of
defective title — or one the procurement of which is tainted with fraud and interest in protecting themselves in the case.
misrepresentation — may be the source of a completely legal and valid  There is also strong reason to believe that even the mortgage in
title, provided that the buyer is an innocent third person who, in good faith, favor of DCC was a mere ploy to make it appear that the Sps.
relied on the correctness of the certificate of title, or an innocent purchaser Guevara exercised acts of dominion over the subject property. This is
for value. so considering the proximity between the property's registration in their
 Complementing this is the mirror doctrine which echoes the doctrinal names and its being subjected to the mortgage. Most telling is that the
rule that every person dealing with registered land may safely rely credit line secured by the mortgage was never used by the spouses,
on the correctness of the certificate of title issued therefor and is resulting in the mortgage's cancellation and the exclusion of DCC as a party
in no way obliged to go beyond the certificate to determine the in Civil Case No. Q-02-47925.
condition of the property.  These circumstances, taken altogether, strongly indicate that Carlos
we emphasized the need for prospective parties to a contract involving and the spouses Guevara failed to exercise the necessary level of
titled lands to exercise the diligence of a reasonably prudent caution expected of a bona fide buyer and even performed acts that are
person in ensuring the legality of the title, and the accuracy of the highly suspect.
metes and bounds of the lot embraced therein, by undertaking
precautionary measures, such as: INVOLUNTARY DEALINGS
(1) verify the origin, history, authenticity, and validity of the title with the A. Attachments
Office of the Register of Deeds and the Land Registration Authority.
(2) engage the services of a competent and reliable geodetic engineer to
verify the boundary, metes, and bounds of the lot subject of said title based Section 69. Attachments — An attachment, or a copy of any writ,
on the technical description in the said title and the approved survey plan order or process issued by a court of record, intended to create or
in the Land Management Bureau; preserve any lien, status, right, or attachment upon registered land,
(3) conduct an actual ocular inspection of the lot; shall be filed and registered in the Registry of Deeds for the province
(4) inquire from the owners and possessors of adjoining lots with respect or the city in which the land lies, and, in addition to the particulars
to the true and legal ownership of the lot in question; required in such papers for registration, shall contain a reference to
(5) put up signs that said lot is being purchased, leased, or encumbered; the number of the certificate of title to be affected and the registered
and owner or owners thereof, and also if the attachment, order, process
(6) undertake such other measures to make the general public aware that or lien is not claimed on all the land in any certificate of title a
said lot will be subject to alienation, lease, or encumbrance by the parties. description sufficiently accurate for identification of the land or
interest intended to be affected. A restraining order, injunction or
 In the case at bar, Bolos' certificate of title was concededly free from liens mandamus issued by the court shall be entered and registered on the
and encumbrances on its face. However, the failure of Carlos and the certificate of title affected, free of charge.
spouses Guevara to exercise the necessary level of caution in light
of the factual milieu surrounding the sequence of transfers from ❖ Attachment — is the legal process of seizing another’s property in
Bolos to respondents bars the application of the mirror doctrine accordance with a writ or judicial order for the purpose of securing
and inspires the Court's concurrence with petitioner's proposition. satisfaction of a judgement yet to be rendered.
CARLOS IS NOT A BUYER IN GOOD FAITH NATURE OF ATTACHMENT

 No. Carlos is not an innocent purchaser for value. Bernardo negotiated with
Bolos for the property as Carlos' agent. This is bolstered by the fact that • Legal process of seizing another’s property in accordance with a writ or
he was the one who arranged for the sale and eventual registration of the judicial order for the purpose of securing satisfaction of a judgment
property in Carlos' favor. yet to be rendered
 Consistent with the rule that the principal is chargeable and bound by the • Writ of attachment is used primarily to seize the debtor’s property to
knowledge of, or notice to, his agent received in that capacity, any seize the debtor’s property in order to secure the debt or claim of the
information available and known to Bernardo is deemed similarly available creditor in the event that a judgment is rendered
and known to Carlos, including the following: • Jurisprudence: a party who delivers a notice of attachment to the RD
 Bernardo knew that the Bolos never acquired possession over the lot, and pays the corresponding fees has a right to presume that the
having admitted knowledge of Aceron’s lot possession as well as the official would perform his duty properly
compromise agreement between the petitioner and Aceron, the Deed of • In involuntary registration, entry thereof in the day book is sufficient
Sale was executed on Nov. 3, 1979, but the ejectment case by Locsin notice to all persons of such adverse claim. The notice of course has
against Aceron was in 1992 – 13 years after property was to be annotated at the back of the corresponding original certificate of
supposedly transferred to Bolos, and compromise agreement approved title, but this is an official duty of the RD which may be presumed to
by the MTC indicating Aceron’s acknowledgement of Locsin’s right to have been regularly performed
possession, being the registered owner thereof.
 Having knowledge of the foregoing facts, Bernardo and Carlos, to our • DBP v. Acting RD: current doctrine thus seems to be that entry alone
mind, should have been impelled to investigate the reason behind produces the effect of registration, whether the transaction entered is
the arrangement. They should have been pressed to inquire into the a voluntary or involuntary one, so long as the registrant has complied
status of the title of the property in litigation in order to protect Carlos' with all that is required of him for purposes of entry and annotation,
interest. and nothing more remains to be done but a duty incumbent solely on
 It should have struck them as odd that it was Locsin, not Bolos, the RD
who sought the recovery of possession by commencing an
ejectment case against Aceron, and even entered into a compromise • Section 69 states that an attachment or any writ, order or process
agreement with the latter years after the purported sale in Bolos' favor. intended to create or preserve any lien upon registered land shall be
Instead, Bernardo and Carlos took inconsistent positions when they argued filed and registered in the RD and shall contain a reference to the
for the validity of the transfer of the property in favor of Bolos, but in the number of the certificate of title to be affected, the registered owner
same breath prayed for the enforcement of the compromise agreement thereof and a description of the land or interest therein.
entered into by Locsin.
 At this point it is well to emphasize that entering into a compromise
agreement is an act of strict dominion. If Bolos already acquired Caviles v. Bautista
ownership of the property as early as 1979, it should have been her who
entered into a compromise agreement with Aceron in 1993, not her Facts:
predecessor-in-interest, Locsin, who, theoretically, had already divested  On Sept. 22, 1982, petitioners herein known as Spouses Caviles filed a
herself of ownership thereof. case against Plata for recovery of a sum of money. The complaint
contained an application for the issuance of a writ of preliminary
SPOUSES GUEVARRA ARE NOT INNOCENT PURCHASERS FOR attachment. On Sept. 24, 1982, the CFI issued a writ and Depty Sheriff
VALUE de Leon issued a Notice of Attachment over a piece of real estate owned
by Plata in Las Piñas.
Prepared by: Gas

 The Notice of Attachment was entered into the Primary Entry Book on B. Adverse Claims (Sec. 70)
Oct. 6, 1982, but it was not annotated on the TCT by the register of
deeds. Neither did the deputy sheriff or the plaintiffs take any steps to
annotate such. Section 70. Adverse Claim — Whoever claims any part or interest in
 On Oct. 18, 1982, Plata sold the property to the respondents herein registered land adverse to the registered owner, arising subsequent
known as Spouses Bautista, which was free from attachment and any to the date of the original registration, may, if no other provision is
encumbrance. On the same date, Plata’s TCT was cancelled in favor of made in this Decree for registering the same, make a statement in
respondents, who have resided in the property since. writing setting forth fully his alleged right or interest, and how or
 No action was taken by the petitioners to annotate the attachment since under who acquired, a reference to the number of the certificate of
they remained ignorant that the property had already been sold and a title of the registered owner, the name of the registered owner, and
new title was issued until much later. When they attempted execution, a description of the land in which the right or interest is claimed.
the notice of levy was entered in February 22, 1984. On March 30, 1987,
4 ½ years after the property was bought by respondents and 3 years The statement shall be signed and sworn to, and shall state the
after the levy on execution was effected, the property was sold on adverse claimant’s residence, and a place at which all notices may be
execution to Spouses Caviles. served upon him. This statement shall be entitled to registration as
 A Certificate of Sale was entered in the Day Book on April 2, 1987, but an adverse claim on the certificate of title. The adverse claim shall be
when inscription was made, they found out that Plata’s certificate had effective for a period of thirty days from the date of registration. After
already been cancelled and issued to Spouses Bautista. The entry was the lapse of said period, the annotation of adverse claim may be
made nonetheless on the title of the Bautistas, but the Register of Deeds cancelled upon filing of a verified petition therefor by the party in
refused to sign such annotation. interest: Provided, however, That after cancellation, no second
 (Consulta to the National Land Titles and Deeds Registration adverse claim based on the same ground shall be registered by the
Administration) Administrator Bonifacio stated that the certificate of same claimant.
sale may be annotated on the Bautistas’ TCT.
 Because the Bautistas refused to surrender their copy of the TCT, Before the lapse of thirty days aforesaid, any party in interest may file
Caviles invoked Section 107 of PD 1529, which is an action to compel a petition in the Court of First Instance where the land is situated for
surrender of the owner’s duplicate of title for the annotation of a the cancellation of the adverse claim, and the court shall grant a
voluntary instrument. speedy hearing upon the question of the validity of such adverse
 (RTC RULING) Ordered the respondents to surrender their duplicate claim, and shall render judgement as may be just and equitable. If
copy for inscription or annotation. the adverse claim is adjudged to be invalid, the registration thereof
 (CA RULING) They reversed the decision of the RTC. The CA dismissed shall be ordered cancelled. If, in any case, the court, after notice and
the petition before the trial court and upheld the Bautistas’ TCT. hearing, shall find that the adverse claim this registered was frivolous,
it may fine the claimant in an amount not less than one thousand
Issues: Who should acquire title to the subject property arising from a pesos nor more than five thousand pesos, in its discretion. Before the
better right? The right to acquire title to registered land from the moment lapse of thirty days, the claimant may withdraw his adverse claim by
of inscription of an attachment on the day/entry book or the right of the filing with the Register of Deeds a sworn petition to that effect.
other to rely on what appears on the duplicate certificate of title for
purposes of VOLUNTARY dealings? PURPOSE
Ruling: • Purpose of annotating the adverse claim on the title of the disputed
BOTH PARTIES ARE IN GOOD FAITH; CAVILES COMPLIED WITH land is to apprise third persons that there is a controversy over the
NECESSARY REQUISITES AND BAUTISTAS RELIED ON FACE OF ownership of the land and to preserve and protect the right of the
TITLE adverse claimant during the pendency of the controversy
• Notice to third persons that any transaction regarding the disputed land
 Respondents relied on the face of the title which was free from the is subject to the outcome of the dispute
notice of attachment, which however, was entered into the primary
entry book of the Register of Deeds in Pasay City. The Register of Deeds FORMAL REQUISITES OF AN ADVERSE CLAIM
failed to annotate the notice of attachment on the original copy of
the title. 1. The adverse claimant must state the following in writing
 The respondent spouses had no notice of any defect, irregularity, or a) his alleged right or interest
encumbrance of the title, and neither did they have any b) how and under whom such alleged right or interest is acquired
knowledge of facts or circumstances which should have put them on c) the description of the land in which the right or interest is
inquiry. They were clearly innocent purchasers for value and in good faith claimed; and
at the time they acquired the subject property. d) the number of certificate of title
 (Sandoval v. CA) Reiteration of a long line of decisions declaring that 2. The statement must be signed and sworn to before a notary public or
one need not go beyond the face of the title when registered other officer authorized to administer oath; and
under the Torrens system.
 Negligence cannot also be imputed to the petitioners in this case. The The claimant should state his residence or the place to which all notices
records show that the petitioners obtained a writ of preliminary may be served upon him *Non-compliance with the above requisites
attachment of the subject property and was then entered in the renders the adverse claim non-registrable and ineffective attorney’s
primary entry book of the RoD of Pasay City. When they sought to fees consists of a share in the property recovered by the client, such
inscribe the certificate of sale, they discovered that the latter had been interest may be the basis of an adverse claim.
sold to the Bautistas.
 The notice of attachment was inscribed on the cancelled certificate of title LEGAL REQUISITES OF AN ADVERSE CLAIM
on Nov. 22, 1983 but was made to appear to be annotated Oct. 6, 1982.
The belated inscription is reflected since said inscription followed the 1. There must be a claim on the land
earlier entry on Oct. 18, 1982 of the sale of the subject property to 2. Claim must be adverse to the registered owner
respondent spouses. 3. Claim must have a reason subsequent to the original registration —
 CA stated that the petitioners did not take any action to annotate the meaning if the basis of the adverse claim happened BEFORE the title
attachment. Bautistas would also contend that the problem would not was issued this is no longer a valid case for adverse claim. It should
have come about had the petitioners not been negligent. be subsequent because registration is proceeding in rem so if you
 SC disagrees. The petitioners paid the corresponding fees for the have any objection by that time they should have raised it during the
annotation of the notice of attachment and had every right to application for registration
presume that the register of deeds would inscribe the said notice 4. No other remedy is provided for under the property registration decree
on the original title covering the subject property. He had a duty to to register the interest or the right of the party
inscribe the notice on the original title.
REGISTRATION COURT MAY DETERMINE THE VALIDITY OF
ENTRY INTO THE DAY BOOK PRODUCES THE EFFECT OF ADVERSE CLAIM
REGISTRATION; SALE RETROACTS TO THE DATE OF NOTICE OF
ATTACHMENT; CAVILES HAS A BETTER RIGHT OVER PROPERTY An adverse claim may be cancelled only after the claim is adjudged invalid
FOR EARLIER REGISTRATION and unmeritorious by the court while passing upon a case where the land
involved is subject of the interest or right being secured by the adverse
 In INVOLUNTARY REGISTRATION, such as attachment, levy upon claim.
execution, and etc., it has been held that entry into the day book
is sufficient notice to all persons of such adverse claim. It should be ADVERSE CLAIM NOT IPSO JURE CANCELLED AFTER 30 DAYS;
annotated at the back of the OCT, but this is the duty of the RoD. HEARING NECESSARY.
 As held in DBP v. Acting Register of Deeds of Nueva Ecija, entry
alone produces the effect of registration, whether the transaction RD cannot unilaterally cancel the adverse claim. There must be a court
entered is a voluntary or involuntary one, so long as the registrant hearing for the purpose. The reason for this is to afford the adverse
has complied with all that is required of him. claimant an opportunity to be heard, providing a venue where the
 Who has the better right then: Caviles Spouses. Article 1544 propriety of his claimed interest can be established or revoked, all for the
states that if both are in good faith and the property in question is purpose of determining at least the existence of any encumbrance on the
immovable, it should belong to the person acquiring it who in good faith title arising from such adverse claim.
first recorded it in the Registry of Property.
 Notice of Attachment: annotated OCTOBER 6, 1982 while the new Sajonas v. CA
TCT was issued on OCTOBER 18, 1982, the date when Plata sold the
property to the Bautistas. It is consistently ruled that the Facts:
auction/execution sale retroacts to the date of the notice of  Spouses Ernesto Uychocde and Lucita Jarin (sellers) agreed to sell a
attachment on Oct. 6, 1982. The earlier registration of petitioners’ parcel of land to the spouses Alfredo Sajonas and Conchita R. Sajonas
levy of preliminary attachment gave them superiority and preference in (buyers) through a contract to sell. On August 27, 1984, the Sajonas
rights. couple caused the annotation of an adverse claim based on the said
Contract to Sell on the title of the subject property.
Prepared by: Gas

 Upon full payment of the purchase price, the Uychocdes executed a
Deed of Sale involving the property in question in favor of the Facts:
Sajonas couple which was registered on August 28, 1985. TCT No. N-  Spouses Calingo were registered owners of a house found in
109417 was issued in the name of the Sajonas couple. Parañaque, Metro Manila. The property was mortgaged to
 The previous notice of levy on execution annotated by defendant Development Bank of the Philippines which was absorbed by
sheriff was carried over to the new title. PAG-IBIG (Home Development Mutual Fund previously).
 [History] Domingo Pilares (defendant-appellant) filed for collection of  On April 27, 1992, Spouses Barrameda (respondents) entered into
sum of money against Ernesto Uychocde. When Uychocde failed to a contract of sale with assumption of mortgage. They issued
pay, defendant-appellant Pilares moved for the issuance of a writ of two checks with Spouses Calingo issuing a receipt dated April 23,
execution which the court granted. 1992. They then informed PAG-IBIG about the sale of property
 A notice of levy on execution was then issued on February 12, 1985. with assumption of mortgage dated April 23, 1992 but was
On February 12, 1985, defendant sheriff Roberto Garcia of Quezon City only served October 2, 1992.
presented said notice of levy on execution before the Register of Deeds  On May 29, 1992, spouses Barrameda filed with the RoD
of Marikina and the same was annotated. On January 10, 1986, the Parañaque an affidavit of adverse claim on the property. On
Sajonas spouses demanded the cancellation of the notice of levy on June 1, 1992, they wrote to PAG-IBIG Mortgage and Loan
execution. Defendant-appellant Pilares. Plaintiffs-appellees filed this Division to inform them that they purchased the property
complaint. from the Calingo spouses and also filed an adverse claim. They
 (SAJONAS’S COMPLAINT) That the annotation of the levy on sought assistance for the procedure of full settlement of loan and
execution, as filed by Pilares, which was carried over to the title of said transfer of property in their names. They moved into the property
plaintiffs is illegal and invalid and was made in utter bad faith, in June 2, 1992.
view of the existence of the Adverse Claim annotated by the plaintiffs  July 13, 1992, a notice of levy with attachment on real
on the corresponding title of the Uychocde spouses. property through a writ of execution was annotated to the
 (PILARES’S ANSWER) Private respondent maintains that the notice of certificate of title of the said property, issued by Judge Santos from
adverse claim is only effective for 30 days and since the same was RTC. This was because of a claim by petitioners Spouses
annotated on August 27, 1984, it will be effective only up to September Rodriguez against the Calingos.
26, 1984, after which it will no longer have any binding force and effect  Spouses Barrameda remitted to spouses Calingo the remaining
pursuant to Section 70 of P.D. No. 1529. Thus, the sale in favor of the balance to complete the payment of the agreed purchase price.
petitioners by the Uychocdes was made in order to defraud their The Calingos acknowledged receipt and waived their rights to the
creditor (Pilares), as the same was executed subsequent to their Barramedas, as well as guaranteeing them that the property was
having defaulted in the payment of their obligation based on a clear of any liens and encumbrances except the mortgage.
compromise agreement.  On October 7, 1992, respondents Barrameda executed a joint
 (RTC RULING) in favor of the Sajonas couple, and ordered the affidavit to state that they are owners of the property, using the deed
cancellation of the Notice of Levy from Transfer Certificate of Title No. of sale with assumption of mortgage as proof, that they registered it
N-109417. CA REVERSED THE FINDINGS. with the RoD, and despite that, Sheriff Dolor of RTC Makati levied
the property despite the adverse claim, that they acquired the
TIMELINE: Annotation of Adverse Claim – August 27, 1984 (which property even before the levy was made, and so it was illegal.
allegedly expires after 30d)  Atty. Loyola (Sppouses Rodriguez’s counsel) pointed out that the
Annotation of Notice of Levy on Execution – February 12, 1985. sale was not registered and that the records of PAG-IBIG
Issue: Whether or not adverse claim is effective only for 30 days; showed that the property was still owned by the Calingos.
which should be preferred between the notice of levy on execution  November 9, 1992, respondents Barrameda found a Notice of
and the deed of absolute sale. Sheriff’s Sale at their gate announcing the auction sale of their
Ruling: house. However, respondents Barrameda served a Notice of Third-
ADVERSE CLAIM DOES NOT LOSE FORCE AND EFFECT AFTER 30 Party Claim upon the sheriff. They filed with the RTC a petition for
DAYS; REQUIRES A NECESSARY ACT quieting of title with prayer for preliminary injunction.
 At first blush, the provision in question would seem to restrict the  (RTC RULING) RTC ruled in favor of Spouses Rodriguez. The
effectivity of the adverse claim to thirty days. But the above provision annotation of the adverse claim was insufficient to establish
cannot and should not be treated separately, but should be read in their claim. They instead should have registered the title in their
relation to the sentence following, which reads: names. Furthermore, the adverse claim lost its effect after 30 days
 "After the lapse of said period, the annotation of adverse claim may be in accordance with the Land Registration Act. They also found the
cancelled upon filing of a verified petition therefor by the party in Calingos and Barramedas colluding the transfer of properties to
interest." defraud 3rd parties.
 If the rationale of the law was for the adverse claim to ipso facto  (CA RULING) Reversed the decision, citing Sajonas v. CA. They
lose force and effect after the lapse of thirty days, then it would not stated that the claim was still in effect during the time that the
have been necessary to include the foregoing caveat to clarify Rodriguezes caused the annotation of levy. So, it cannot prevail
and complete the rule. For then, no adverse claim need be cancelled. over the Barramedas’ claim.
If it has been automatically terminated by mere lapse of time, the law
would not have required the party in interest to do a useless act. TIMELINE: Calingos mortgaged with PAG-IBIG their property ->
 The reason why the law provides for a hearing where the validity of the judgment in favor of Rodriguez requiring Calingo to pay -> Calingo sold
adverse claim is to be threshed out is to afford the adverse property to Barramedas -> notice of adverse claim by Barramedas (not
claimant an opportunity to be heard, providing a venue where the registered) -> notice of levy on property by sheriff -> Barramedas still paid
propriety of his claimed interest can be established or revoked, all for in full even after notice -> notice of auction made -> Barramedas file a
the purpose of determining at last the existence of any encumbrance on case in court.
the title arising from such adverse claim. This is in line with the Issue:
provision immediately following: Whether or not the inscription of adverse claim will prevail over
 "Provided, however, that after cancellation, no second adverse claim the notice of levy.
shall be registered by the same claimant.
 Should the adverse claimant fail to sustain his interest in the property, Ruling:
the adverse claimant will be precluded from registering a second THE MORTGAGE (OR OTHER VOLUNTARY INSTRUMENTS) WILL
adverse claim based on the same ground. NOT TAKE EFFECT TO CONVEY OR AFFECT REGISTERED LAND
UNLESS REGISTERED WITH THE REGISTER OF DEEDS.
THE ANNOTATION OF A DEED OF SALE SHOULD PREVAIL SINCE A  It cannot. The Barramedas anchor their claim on the property on the
NOTICE OF ADVERSE CLAIM WAS ANNOTATED WITHOUT LOSING deed of sale with assumption of mortgage executed by the Calingos.
FORCE AND EFFECT AFTER 30 DAYS The Property Registration Decree (PRD) requires that the
document be registered with the RoD to be binding on third
 Since the disputed inscription of adverse claim on the TCT was still in persons.
effect on February 12, 1985 when the notice of levy on execution was  According to Sec. 51 of the PRD: No mortgage or other voluntary
instrument except a will purporting to convey/affect registered land
annotated thereto by the Sheriff, he is consequently charged with
shall take effect as a conveyance or bind the land, and only
knowledge that the property sought to be levied upon on execution was
operates as a contract between the parties and as evidence of
encumbered by an interest the same as or better than that of the authority to the RoD to make registration. The act of registration
registered owner thereof. shall be the operative act to convey or affect the land insofar
 Such notice of levy cannot prevail over the existing adverse claim as third persons are concerned.
inscribed on the certificate of title in favor of the petitioners.  In this case, the deed of sale with assumption of mortgage was not
 This can be deduced from the pertinent provision of the Rules of registered.
Court, to wit:
 Section 16. Effect of levy on execution as to third persons. — The levy AN ADVERSE CLAIM IS SUFFICIENT TO AFFECT THIRD PARTIES
on execution shall create a lien in favor of the judgment creditor over WHEN THE REGISTRATION OF SUCH INTEREST IS NOT
the right, title and interest of the judgment debtor in such property at OTHERWISE PROVIDED BY LAW
the time of the levy, subject to liens or encumbrances then existing
(such as an adverse claim).  (Leviste and Company Inc. v. Noblejas) where the owner
 In PNB vs. Court of Appeals, we held that "the subsequent sale of the refuses to surrender the duplicate certificate for the
property to the De Castro spouses cannot prevail over the adverse claim annotation of the voluntary instrument, the grantee may
of Perez, which was inscribed on the bank's certificate of title on file with the Register of Deeds a statement setting forth
October 6, 1958. That should have put said spouses on notice, and his adverse claim, as provided for in Section 110 of Act No.
they can claim no better legal right over and above that of Perez. 496. The annotation’s purpose is to protect a person’s interest
The TCT issued in the spouses' names on July, 1959 also carried the and serve as a warning of an adverse claim of interest.
said annotation of adverse claim. Consequently, they are not  The respondents’ reasoning for non-registration of the deed of
entitled to any interest on the price they paid for the property". sale was because the duplicate copy of the certificate of title was
in possession of PAG-IBIG. However, it was never shown that
the Barramedas nor the Calingos exerted any effort to
Rodriguez v. CA retrieve the duplicate copy for purpose of registering the
Prepared by: Gas

deed of sale with assumption of mortgage. They didn’t even  Filinvest also learned upon inquiry with the RoD Las Piñas that Lot 8
seek to obtain or inform HDMF of the sale. There was haste was sold to HDC and was given the duplicate copy.
in disposing the property when the Calingos informed PAG-IBIG  Thus, Filinvest’s knowledge that Golden Haven bought Lot 6 –
only on October 2, 1992. In fact, their contract of mortgage a lot Filinvest was interested in – and had annotated an
stipulated that the Calingos were prohibited from selling adverse claim while maintaining physical possession should
the property without the written consent of the mortgagee. have put Filinvest on caution if it bought the other lots. It should
 There is no reason for the parties’ failure to seek approval of have investigated the true status of Lots 1, 2, 6, and 12 by asking
PAG-IBIG since the Barramedas were ready to pay in full the Golden Haven the size and shape of its interest in the lands covered
balance of loan plus interest. by the same title. The sellers only refused to follow obligations when
 More suspicious is the fact that the Calingos were adjudged to they found a better offer.
pay the Rodriguezes in January 27, 1992 which was
before the sale on April 27, 1992. It is also suspicious how Martinez v. Garcia
the Barramedas readily remitted the full payment on
August 21, 1992, even with knowledge of the levy. A Facts:
prudent buyer is to ensure that the title is clear and free from  Edilberto Brua was a registered owner of a parcel of land in Rizal.
any liabilities. It was first mortgaged to the Government Service Insurance
 (Sec. 70 of PD 1529) An annotation of an adverse claim is a System (GSIS) where the mortgage was annotated at the back of
measure designed to protect the interest of a person over his the title on June 5, 1974.
property where registration of such interest is not otherwise  On February 5, 1980, Brua obtained a loan from his brother-in-
provided for by the law on registration of real property. law Garcia, and to secure payment, he executed a Deed of
Real Estate Mortgage. Because it was still in GSIS’s possession,
The essence of the case is that unless there is another way of Garcia could not register the deed. Instead, he executed an
registration provided for by law, an adverse claim protects the Affidavit of Adverse Claim, registering it with the RoD of Rizal
claimant’s interest. HOWEVER, for mortgages and other voluntary WHICH REMAINS UNCANCELLED UP TO THIS TIME.
instruments, YOU STILL NEED TO REGISTER IT WITH THE  On October 1991, Brua requested Garcia to pay the loan, so that
REGISTER OF DEEDS TO BIND THIRD PARTIES – a notice of adverse it would be released to Garcia. He paid the amount of P400,000,
claim will NOT bind third parties in this situation. thus the title was released to him.
EXCEPTION: THE LEVISTE CASE – WHERE THE OWNER REFUSED TO  October 22, 1991, a Deed of Absolute Sale was executed
SURRENDER THE COPY, A NOTICE OF ADVERSE CLAIM WILL BE between Garcia and Brua. As stated by the deed, the subject
SUFFICIENT INSTEAD. Absent of any justifiable reason on why property was only a partial payment of Brua’s mortgage
registration of a registrable document (deed of sale) cannot be indebtedness to Garcia which he could no longer redeem from
done, filing of a notice of Adverse Claim, in order to bind third Garcia.
parties, cannot substitute the registration requirement.  Garcia registered the Deed of Sale with the Registry of Deeds,
Rizal and so the new TCT was issued in Garcia and his wife’s name.
Golden Haven Memorial Park v. Filinvest However, the annotations of the previous title were carried
over (Notice of Levy of Attachment – Jan. 8, 1981, Notice of Levy
Facts: on Execution in favor of Martinez – July 11, 1988, Certificate of
Basically, two real estate developers who are buyers of the same land. Sale in favor of Garcia – Sept. 2, 1988, Notice of Levy on Execution
Who has better title? The one who had annotated a notice of adverse claim in favor of Pilipinas Bank – Dec. 8, 1981, and Cancellation of
(Golden Haven). Mortgage with GSIS – Oct. 24, 1991).
 Yap, Vivars, Cruz, Aquino, Corpuz, and Sobremesana, and other  All the annotations found at the back of the title of the property
relatives inherited a parcel of land in Las Piñas City. It was then (Notices of Levy and Certificate of Sale) were made in connection
subdivided into 13 lots in a judicial partition. 4 of the lots were with Martinez’s action for Collection of Sum of Money filed against
distributed as follows: Lots 1+12 to Aquino, Lot 2 to Corpuz Brua where judgment was in favor of Martinez.
and Sobremesana, and Lot 6 to Yap, Cruz, and the Vivars.  Pilipinas Bank’s Notice of Levy was by virtue of their case against
 On March 6, 1989, Yap acting for Lot 6 owners, executed an Brua.
agreement to sell the lot in favor of Golden Haven Memorial  Garcia and Brua filed with the RTC Pasig an Action to Quiet
Park payable in 3 installments. Aquino also acted for himself, Title against Martinez because of the encumbrances/liens
Corpuz, and Sobremesana, in executing an agreement with attached to the title. They argued that the encumbrances were
Golden Haven, selling Lots 1, 2, and 12. In both cases, GHM paid registered subsequent to the annotation of adverse claim made in
the first installment upon the contract’s execution. 1980. Pilipinas Bank was later included.
 Golden Haven then caused an annotation of Notice of Adverse  (RTC RULING) Dismissed the action. The adverse claim was
Claim. The sellers of the four lots wrote to Golden Haven that they predicated on his interest as a mortgagee of a loan because he
were still working on the titling of the lots and whether it was still was not yet the purchaser as of said date. When the notices of levy
interested in proceeding. Golden Haven said yes. They were merely were registered in 1981 and 1998, Garcia’s claim became inferior
waiting for the titles to pay the second instalment. as a second mortgagee, and that Garcia’s decision to redeem
 On August 1989, Filinvest Devt. Corporation applied for the and purchase the property when there were already notices
transfer over Lots 2, 4, and 5 (Lot 2 – Corpuz and Sobremesana’s of levy showed bad faith on his part. He did not even testify or
lot), but the Las Piñas RoD declined application. Filinvest then participate in the case. RTC did not uphold the allegation that they
learned that Lot 8, belonging to some other heir from the same were unaware of a public auction and consequent annotation of the
mother title, had been sold to Household Development certificate of sale.
Corporation, a sister company of Golden Haven. It held the  (CA RULING) Reversed and set aside the RTC decision. CA said
duplicate copy of that title. that the subsequent sale cannot prevail over the adverse
 Filinvest filed a petition to surrender and cancel the duplicate claim. While one who buys the property from the registered owner
copy of HDC over the lot, stating that Filinvest bought Lots 1, 2, need not look beyond the title, he is still bound by the liens and
6, and 12 (Lot 1+12 – Aquino’s Lot, Lot 6 – Yap, Cruz, and Vivars’ encumbrances annotated. The notice of adverse claim was made
lot) as shown by the three deeds of absolute sale. prior to the certificate of sale and notices of levy and gave the
 January 14, 1991, Golden Haven filed against the sellers and petitioners notice of Garcia’s right to the property.
Filinvest a complaint for annulment of deeds of sale before the  Petitioners could no longer be considered buyers in good
RTC. faith. CA also claimed RTC erred in concluding that Garcia was
 (RTC RULING) Golden Haven’s contracts to sell are valid, and a purchaser in bad faith because the adverse claim was
the sale to Filinvest is null and void. annotated in 1980. He could not have foreseen that petitioner
 (CA RULING) Affirmed the RTC decision only with Lot 6. Lots 1, 2, would buy the property eight years after. The notice is still valid even
and 12 are valid in favor of Filinvest. after 30 days pursuant to Sajonas v. CA.
Issue: Whether or not the contracts to ell that the sellers executed ARGUMENTS BEFORE SC
in favor of Golden Haven covering the same lots to Filinvest are  MARTINEZ: Garcia’s adverse claim is nothing but a notice of interest
valid and enforceable. adverse to Brua the amount of the loan secured by a Deed of Real
Ruling: Estate Mortgage. Adverse claim cannot be superior to a final
THE NOTICE OF ADVERSE CLAIM SERVES AS A WARNING TO sale. Sajonas v. CA does not apply because Sajonas’s claim was
THIRD PERSONS; FILINVEST SHOULD HAVE BEEN MORE made by virtue of a contract to sell while Garcia’s was as a
DILIGENT IN BUYING THE LOTS SINCE THE NOTICE WARNED mortgagee of Brua. She admits that she is obliged as a vendee in
THEM OF DOUBLE SALE a public sale to pay liens and encumbrances existing, necessarily
 To prove good faith, the buyer of registered land only needs to show including the adverse claim in the amount of P150,000.
that he relied on the face of the title, but it is only true where the  GARCIA: Appropriate remedy should have been petition for review
buyer is unaware of any adverse claims; failing that, he must show under Rule 45. There was no grave abuse since CA had legal basis.
a higher degree of diligence to qualify as a buyer in good faith. Any lien inscribed earlier prevails over any inscribed later.
 Filinvest was on notice that Holden Haven caused the annotation as
early as August 4, 1989. Despite that, Filinvest still bought Lots 1, Issue: Whether or not the notice of levy should prevail over the
2, 6, and 12 on later dates (Sept. 10, Nov. 18, and Dec. 29). notice of adverse claim?
 Filinvest contends that the title carried a notice of adverse claim only Ruling:
with respect to Yap’s part of Lot 6 and did not affect Lots 1, 2, 12,  (Unimportant procedure law) Petition is dismissed. Petitioner should
and the remainder of Lot 6. SC disagrees. have filed for petition for review under Rule 45 instead of certiorari
 The annotation of an adverse claim is intended to protect the since she is assailing CA decisions. Even if they were to consider
claimant’s interest in the property. It is a warning to third petition for certiorari under Rule 65, CA must be shown to commit
parties dealing with the property that someone claims an grave abuse of discretion.
interest in it or asserts a better right than the registered owner. It
constitutes a notice to the whole world. While the notice here is only LEVY DOES NOT MAKE THE JUDGMENT CREDITOR THE OWNER OF
to one lot, it served as a warning that one of the owners was THE PROPERTY; THE LIEN IS STILL SUBORDINATE TO ALL VALID
engaged in double selling. CLAIMS EXISTENT AT THE TIME THE LIEN ATTACHED
Prepared by: Gas

 Petitioner contends that the adverse claim inscribed on the title is Facts:
but a notice that the latter has an interest adverse to Brua’s title and  Padilla Jr. (petitioner) and his wife are registered owners of 3 lots
that such claim cannot be superior to a final sale. situated in Bago City. Philippine Producers Cooperative
 Sec. 12 Rule 39 of the RoC shows that the levy does not make (respondent) is a marketing cooperative which had a money claim
the judgment creditor the owner of the property levied upon. against petitioner.
He only obtains a lien. Such levy on execution is still subject and  On April 24, 1987, respondent filed a case against petitioner for
subordinate to all valid claims existing against property at the collection of a sum of money in RTC of Bacolod City. Despite
time the execution lien attached like real estate mortgage. receipt of summons, Padilla Jr. did not file an answer. On March 3,
 The adverse claim of Garcia was already existing when the 1988, Philippine Producers Coop. moved to have the
Notice of Levy on Execution was inscribed on July 11, 1988 and petitioner be declared in default. Trial court granted this.
Sept. 2, 1988. The adverse claim is sufficient to constitute  On May 31, 1990, the Court issued a writ of execution. On June
constructive notice. She was already charged with the knowledge 4, 1990, the three lots from the Bago Cadastre and registered in
that the subject property sought to be levied was encumbered by an Padilla Jr.’s name were levied. Arimas auctioned off the lots to
interest the same or better than that of the registered owner. satisfy judgment with the Cooperative as the only bidder. So,
 Martinez cannot be considered as a buyer in good faith. a certificate of sale was executed in favor of respondent and
Petitioner admitted that she saw Garcia’s adverse claim registered with the RoD.
already inscribed on the title when she registered her notice of  When petitioner failed to exercise his right of redemption
attachment in 1981. within 1-year, the court ordered the issuance of a writ of
possession for the sheriff to cause delivery of the physical possession
THE ADVERSE CLAIM IS STILL IN FORCE; WHILE THE DEED OF of the properties.
SALE WAS REGISTERED AFTER THE NOTICE OF LEVY AND  On May 17, 1995, the respondent filed a motion to direct the
CERTIFICATE OF SALE, THE DEED CLEARLY STATED THAT THE RoD to issue new titles over the properties in his name,
PROPERTY WAS PARTIAL PAYMENT FOR INDEBTEDNESS alleging that the RoD of Bago City would not issue new titles unless
the owner’s copies were first surrendered to him. Respondent said
 With regard to the inapplicability of Sajonas v. CA, the SC is not that the surrender was impossible because this was an
impressed. She argued that the adverse claim of Sajonas was based involuntary sale and the owner’s copies were with petitioner.
on a contract to sell while Garcia’s was merely based on being a RTC granted the motion. CA affirmed the order.
mortgagee of Brua.  Padilla Jr. Contentions: Respondent’s motion for the RD to cancel
 The issue in Sajonas was whether the adverse claim was still in force the certificate of titles and issue new ones was a real action and
when respondent caused annotation of the notice of levy on motion was infirm because the respondent did not furnish a
execution on the title. The inscription was still in effect, such that copy. Under Sec. 6, Rule 39 of the Rules of Civ. Procedure, the
the respondent therein was charged with knowledge that the subject execution of judgment was barred by prescription since the motion
property sought to be levied was still encumbered by an interest the was filed more than 5 years after the writ of execution was issued.
same or better than that of the registered owner. Respondent failed to follow the correct procedure for cancellation of
 In this case, although the deed of sale was done after the a certificate of title and issuance of a new one.
notice of levy on execution was inscribed, it was still clearly  Sec. 6 - Execution by motion or by independent action. —
stated in the deed that the subject property was only a partial A final and executory judgment or order may be executed on
payment for the mortgage indebtedness to Garcia. The sale of motion within five (5) years from the date of its entry. After the
the property was by reason of the prior loan. The mortgage was lapse of such time, and before it is barred by the statute of
already existing on the title of the subject property when the notice limitations, a judgment may be enforced by action. The revived
of levy and certificate of sale in favor of Martinez was inscribed. So, judgment may also be enforced by motion within five (5) years
her claim must yield to the encumbrance by Garcia. from the date
Basically, the case is about registration of land that was granted to

C. Enforcement of Liens on Registered Land the cooperative by virtue of an involuntary sale – levy on execution
and subsequent public auction. The RoD says that he needs the
Enforcement of Liens on Registered Land and Application of New owner’s copies to give a new title, but the cooperative says it’s
impossible since it was an involuntary sale. Now, Padilla Jr. says
Certificate Upon Expiration of Redemption Period (Sec. 74-75) that the motion was not correct because he was not furnished a
Sec. 74. Enforcement of liens on registered land. — Whenever registered land is copy and was barred by prescription for being filed more than 5
sold on execution, or taken or sold for taxes or for any assessment or to enforce a lien of years from the time the writ of execution was given.
any character, or for any costs and charges incident to such liens, any execution or Issue: Whether or not the respondent’s right to have new titles
copy of execution, any officer’s return, or any deed, demand, certificate, or affidavit, or issued in its name is now barred by prescription.
any other instruments made in the course of the proceedings to enforce (2) Whether or not the motion in question is the proper remedy for
such liens and required by law to be recorded, shall be filled with the Register of cancelling the petitioner’s certificates of title and new ones issued
Deeds of the province or city where the land lies and registered in the registration book, in its name.
and a memorandum made upon the proper certificates of title in each case as lien or Ruling:
encumbrance. THE RIGHT HAS NOT PRESCRIBED BECAUSE THE
AFOREMENTIONED ARTICLE CITED BY PETITIONER IS WITH
Sec. 75. Application for new certificate upon expiration of redemption REGARD TO LEVY AND SALE, NOT THE ISSUANCE OF A NEW TITLE
period — Upon the expiration of the time, if any, allowed by law for redemption after  (Heirs of Blancaflor v. CA) A writ of execution was secured by
registered land has been sold on execution taken or sold for the enforcement of a lien of Sarmiento Trading Corporation in 1968, and by virtue of that, it levied
any description, except a mortgage lien, the purchaser at such sale or anyone real property belonging to Blancaflor. When it was auctioned, the
claiming under him may petition the court for the entry of a new certificate of title to Corporation was able to acquire it. After the lapse of the redemption
him. Before the entry of anew certificate of title, the registered owner may pursue all period, it consolidated its ownership over the property. The RoD Iloilo
legal and equitable remedies to impeach or annual such proceed ings. requested Blancaflor to surrender his duplicate copy, but he did
not comply, so the RoD refused to issue a new title. A prayer for
REGISTRATION OF DEEDS RELATING TO EXECUTION AND TAX DELINQUENCY SALES the surrender of the duplicate copy of the title was made, but the
Whenever registered land is sold on execution, or taken or sold for taxes petitioners refused citing prescription.
or for assessment or to enforce a lien of any character, or for any costs  However, SC stated that execution is enforced by fact of levy
and charges incident to such liens, any execution or copy of execution, any and sale, such that the Corporation has acquired right over the
officer’s return, or any deed, demand, certificate, or affidavit, or other title. Because Blancaflor was unable to redeem, he was
instrument made in the course of such proceedings to enforce such liens divested of all his rights to the property.
and required by law to be recorded, shall be filed with the RD of the  Padilla’s reliance on Sec. 6 Rule 39 of Civil Procedure is misplaced. The
province or city where the land lies and registered in the registration book, fact of levy and sale constitutes execution, not the action for
and a memorandum made upon the proper certificate of title in case as issuance of a new title. Since the levy and sale took place in
lien or encumbrance June and July of 1990. This was after a year from judgment, so it
The following incidents on registered land in the nature of involuntary was done in a timely fashion.
dealings shall be registered to be effective—  Padilla Jr. admits his failure to redeem the properties within the one-
• Continuance, dissolution or discharge of attachments year period by adopting the facts of the CA decision. He is definitely
• Orders and decisions of the court divested of his ownership over the lots.
• Deed of sale, officer’s return, order of execution, and other instruments
A MOTION IS NOT THE PROPER REMEDY; A PETITION MUST
TAX DELINQUENCY SALE REQUIRES PERSONAL NOTICE TO BE FILED IN COURT AS STATED BY PD 1529
TAXPAYER
Notice of sale to the delinquent land owners and to the public in general is  Petitioner is correct in assailing the improper filing of a mere
essential and indispensable requirement of law, the non-fulfillment of motion for the cancellation of the old TCTs and issuance of new
which, vitiates the sale ones as a result of petitioner’s refusal to surrender his duplicate TCTs.
This called for a separate cadastral action initiated via petition.
ENTRY OF NEW CERTIFICATE  (Sec. 107 of PD 1529) Surrender of withheld duplicate
In case registered land which has been sold on execution for the certificates — Where it is necessary to issue a new certificate
enforcement of any lien, except a mortgage lien, has not been redeemed of title pursuant to any involuntary instrument which divests the
for a period allowed by law, the purchaser at such sale or anyone claiming title of the registered owner against his consent or where a
under him may petition the court for the issuance of a new certificate of voluntary instrument cannot be registered by reason of the
title to him. refusal of failure of the holder to surrender the owner's duplicate
But before the entry of such new certificate, the registered owner may certificate of title, the party in interest may file a petition in court
pursue all legal and equitable remedies to impeach or annul the to compel the surrender of the same to the Register of Deeds.
proceedings. The court, after hearing, may order the registered owner or any
person withholding the duplicate certificate to surrender the
Padilla Jr. v. Phil. Producer’s Cooperative same, and direct the entry of a new certificate or memorandum
upon such surrender. If the person withholding the duplicate
Prepared by: Gas

certificate is not amenable to the process of the court, or if for On September 28, 2004, the RTC denied the Motion holding that a
any reason the outstanding owner's duplicate certificate cannot mere motion is not sufficient for the cancellation of a certificate of
be delivered, the court may order the annulment of the same as title. The RTC ruled that under Section 107 of Presidential Decree No.
well as the issuance of a new certificate of title in lieu thereof. 1529, the Property Registration Decree, a petition and a hearing are
Such new certificate and all duplicates thereof shall contain a required for the issuance of a new certificate of title.
memorandum of the annulment of the outstanding duplicate. In this new petition, MFR impleaded the Register of Deeds as additional
(Basically, it states that a petition in court to compel defendant and prayed for the same reliefs as those prayed for in their
surrender is required). previous motion with an additional prayer for the issuance of an order
 Respondent states that it resorted to filing the contested motion directing respondents to immediately surrender the Owners Duplicate
because it could not attain new certificates of title since the petitioner Copy of TCT No. T-198753.
refused to surrender his TCTs. The proper course is to file a petition in Respondents, through their new counsel, filed the previously adverted to
court rather than move for issuance of new titles. Opposition and Motion, opposing Reyes April 27, 2006 Motion and moving
 (Blancaflor v CA) Sec. 78 of Act 496 – upon expiration of time, to declare void the sale of the subject property.
person claiming under execution may PETITION the court entry of a The RTC noted that there was substantial compliance with the
new certificate. requirements of [Section 15, Rule 39 of the Rules of Court evidenced] in
 Sec. 75 of PD 1529 – Upon expiration of time, purchaser of such sale the Sheriffs Report dated January 4, 1999, as well as the publication and
or anyone claiming under him may PETITION the court for entry of posting requirements, extant in the records of this case. In conclusion, the
a new certificate. RTC ruled that respondents are estopped from questioning the
 The reasons behind the law make sense. It provides due process to proceedings, after keeping silent thereon for a long time, despite notice
the registered land owner and prevents fraudulent or mistaken thereof. CA annulled and set aside the ruling of the RTC.
conveyance of land, which the value of may exceed the judgment
obligation. ISSUE
 In any event, respondent can still file the proper petition with the 1. WN the execution sale of the subject property is void – Valid!
cadastral court for the issuance of new titles in its name. 2. Proceeding from the validity of the execution sale and the
consolidation of Reyes’ ownership over the subject property,
FOR THE SAKE OF REFERENCE: whether Sec. 107 of PD 1529 contemplates the filing of a separate
Sec. 78 of Act 496 - Upon the expiration of the time, if any, allowed by cadastral case before the RTC acting as a land registration court –
law for redemption after registered land has been sold on any execution, Yes!
or taken or sold for the enforcement of any lien of any description, the
person claiming under the execution or under any deed or other instrument HELD: Petition is partially impressed with merit.
made in the course of the proceedings to levy such execution or enforce Contrary to the CA's holding, the burden of evidence to prove lack of
any lien, may petition the court for the entry of a new certificate to him, compliance with Section 15, Rule 39 of the Rules of Court rests on the
and the application may be granted: Provided, however, That every new party claiming lack thereof i.e., respondents. Respondents made no
certificate entered under this section shall contain a memorandum of the attempt to meet this burden of evidence, simply aintaining lack of notice
nature of the proceeding on which it is based: Provided further, That at of the entire proceedings before the trial court. We cannot subscribe to
any time prior to the entry of a new certificate the registered owner may respondents' belated posturing. The disputable presumption that official
pursue all his lawful remedies to impeach or annul proceedings under duty has been regularly performed was not overcome by respondents. The
executions or to enforce liens of any description. documents on record lead us to the inevitable conclusion that respondents
Sec. 75 of PD 1529 - Application for new certificate upon expiration of had constructive, if not actual, notice of the execution proceedings from
redemption period. Upon the expiration of the time, if any, allowed by law the issuance of the Writ of Execution, the levy on the subject property, its
for redemption after registered land has been sold on execution taken or subjection to execution sale, up to and until the proceedings in the RTC
sold for the enforcement of a lien of any description, except a mortgage relating to the issuance of a new certificate of title over the subject
lien, the purchaser at such sale or anyone claiming under him may petition property.
the court for the entry of a new certificate of title to him. In this case, the purpose of giving notice through posting and publication
Before the entry of a new certificate of title, the registered owner may under Section 15 (c) of the same rule — to let the public know of the sale
pursue all legal and equitable remedies to impeach or annul such to the end that the best price or a better bid may be made possible to
proceedings. minimize prejudice to the judgment debtor — was realized.
Another thing militates against respondents' claim of lack of knowledge of
Reyes vs Tang Soat Ing the encumbrance on their property — the separate registrations of: (1) the
Notice of Levy; (2) the Certificate of Sale. In this jurisdiction, we adhere
FACTS: The controversy arose from a complaint for Enforcement of to the doctrine that registration in a public registry works as constructive
Easement and Damages with Prayer for Preliminary Injunction and notice to the whole World.
Restraining Order filed by MFR Farms, Inc. (MFR) against respondents. At the very least, respondents' attack on the validity of the execution
MFR complained of respondents commercial and industrial use of their proceedings, culminating in the execution sale of the subject property, is
property covered by TCT No. T-198753, and sought the enforcement of barred by laches.
the encumbrance contained in their title. MFR likewise asked for the The records bear out that Sheriff Legaspi served a copy of the Writ of
payment of damages suffered by its pig farm resulting from respondents Execution on respondents, and followed up thereon. With no action
illegal use of their property. forthcoming from respondents, who are ostensibly evading payment of
RTC granted MFR’s complaint and held that using the land as a chemical their judgment debt, the Sheriff correctly levied on the subject property.
processing site and as a storage facility for chemicals is devoting it to For more than 5 years from the execution sale thereof, with respondents
industrial purposes, which is not allowed under the subsisting not exercising their right of redemption, up to the filing of a Motion, and
encumbrance on the property. CA affirmed with modification the ruling of subsequently, a Petition for the issuance of a new certificate of title over
the RTC. the property in Reyes' name, respondents made no effort to settle their
On September 28, 1998, upon motion of MFR, the RTC issued a Writ of judgment debt, much less, to ascertain the status of the execution
Execution. proceedings against them and the levy on, and consequent sale of, their
On January 4, 1999, Sheriff Legaspi submitted a Sheriffs Report property. Truly significant is the fact that 8 years had lapsed, from the
manifesting: time respondents received a copy of the Writ of Execution in October 1998
The caretaker, Rodolfo Mendez, said that Tang Soat Ing has no more until they, through their new counsel, filed the Opposition and Motion in
properties and the factory located in the compound is being leased to other May 2006, before respondents were prodded into action.
people. On December 10, 1998, the undersigned went back to Tang Soat The facts of this case demonstrate respondents' stubborn refusal to comply
Ing at Tungkong Mangga, Sa Jose del Monte, Bulacan but said person was with the judgment against them by claiming lack of notice of the execution
not there and also Rodolfo Mendez was not around because he was in proceedings. We reiterate that this claim is belied by the evidence on
Manila. record and cannot invalidate the enforcement and execution of a final and
Thereafter, on January 7, 1999, Sheriff Legaspi presented the Writ of executory judgment of this Court. On the whole, respondents' silence and
Execution and the Notice of Levy on Execution of Real Property[11] covering inaction for 8
TCT No. T-198753 to the Register of Deeds of BulacanProvince. years from the time the subject property was validly levied upon by the
On February 4, 1999, the Notice of Levy was inscribed on TCT No. T- RTC, bars them from claiming invalidity of the execution proceedings.
198753. On May 7, 1999, Sheriff Legaspi issued a Notice of Sale on Notwithstanding the validity of the execution sale and Reyes' consolidation
Execution of Real Property which he likewise posted on the following of ownership over the subject property upon the lapse of the redemption
places: period, we hold that Section 107 of Presidential Decree No. 1529
(a) The Bulletin Board of Municipal Hall of San Jose del Monte, contemplates the filing of a separate and original action before the RTC,
Bulacan; acting as a land registration court.
(b) The Bulletin Board of the Church of San Jose del Monte, Bulacan; That a succeeding registration of property in another's name, after its
(c) The Bulletin Board of the Chapel of Gaya-gaya, San Jose del Monte, original registration, contemplates a separate original action is reinforced
Bulacan; by our ruling
(d) The Bulletin Board of the main entrance of the Provincial Capitol
Building of Malolos, Bulacan; and
(e) The Posting Board of the Office of the Ex-Officio Sheriff located at D. Lis Pendens (sec. 76)
the back of the Bulwagan ng Katarungan Building, Malolos,
Bulacan.
On June 12, 19 & 26, 1999, the Notice of Sale on Execution of Real Property Sec. 76. Notice of lis pendens. — No action to recover possession of real estate, or to
was published in The Times Newsweekly. quiet title thereto, or to remove clouds upon the title thereof, or for partition, or other
On July 19, 1999, at the public auction of the subject property covered by proceedings of any kind in court directly affecting the title to land or the use or
TCT No. T-198753, MFR was declared as the highest bidder. On even date, occupation thereof or the buildings thereon, and no judgement, and no
Sheriff Legaspi issued a Certificate of Sale which was registered with the proceeding to vacate or reverse any judgement, shall have any effect upon
Register of Deeds of Bulacan Province. registered land as against persons other than the parties thereto, unless a
After more than five (5) years, on September 17, 2004, with respondents memorandum or notice stating the institution of such action or proceeding and the
failing to exercise their right of redemption, MFR filed a Motion asking the court wherein the same is pending, as well as the date of the institution
RTC to issue an order directing the Register of Deeds of Bulacan Province thereof, together with a reference to the number of the certificate of title, and an
to cancel TCT No. T-198753 in the name of respondents, and issue a new adequate description of the land affected and the registered owner thereof, shall have
certificate of title in the name of MFR. been filed and registered.
Prepared by: Gas

Sec 77 Cancellation of lis pendens. — Before final judgment, a notice of lis • More fundamentally, a notice of lis pendens is only a warning to the
pendens may be canceled upon order of the court, after proper showing that the prospective purchaser or incumbrancer that the particular property is in
notice is for the purpose of molesting the adverse party, or that it is not litigation and that he should keep his hands off the same, unless he intends
necessary to protect the rights of the party who caused it to be registered. It to gamble on the results of the litigation
may also be canceled by the Register of Deeds upon verified petition of the party who
caused the registration thereof. At any time after final judgment in favor of the CANCELLATION OF LIS PENDENS
defendant, or other disposition of the action such as to terminate finally all rights of the • Ordinarily a notice which has been filed in a proper case cannot be
plaintiff in and to the land and/or buildings involved, in any case in which a cancelled while the action is pending and undetermined, except in cases
memorandum or notice of lis pendens has been registered as provided in the preceding expressly provided for by statute
section, the notice of lis pendens shall be deemed canceled upon the registration of a • It may be cancelled upon order by the court or upon action by the RD at
certificate of the clerk of court in which the action or proceeding was pending stating the instance of the party who caused the registration of the notice
the manner of disposal thereof. • While the trial court has inherent power to cancel a notice of lis pendens,
such power is exercised under express provisions of law
NATURE AND PURPOSE OF LIS PENDENS - If the annotation was for the purpose of molesting the title of
• Lis pendens literally means a pending suit the adverse party
• Doctrine that refers to the jurisdiction, power or control which a court - When the annotation isn’t necessary
acquires over a property involved in a suit, pending the continuance of the
action, until final judgment Viewmaster Construction Vs Maulit, Et Al
• May involve actions that deal not only with title or possession of a
property but also with the use and occupation of a property Principle: A notice of lis pendens may be registered when an action or a
• The litigation must directly involve a specific property which is necessarily proceeding directly affects the title to the land or the buildings thereon; or
affected by the judgment the possession, the use or the occupation thereof. Hence, the registration
of such notice should be allowed if the litigation involves the enforcement
THE PURPOSE OF LIS PENDENS of an agreement for the co-development of a parcel of land. What is
• To protect the rights of the party causing the registration of the lis established here is enforcement of joint-venture agreement which is well
pendens within the definition of notice of lis pendens.
• To advise third persons who purchase or contract on the subject FACTS:
property that they do so at their peril and subject to the result of the Allen Roxas is one of the stockholders of State Investment Trust, Inc. In
pending litigation order to gain control and ownership of the said company, Roxas applied
for a loan with First Metro Investment, Inc. First Metro agreed to grant the
The notice of lis pendens is a notice to the whole world that a particular loan provided Roxas could procure a guarantor to secure the payment of
real property is in litigation. The inscription serves as a warning that one the loan.
who acquires interest over litigated property does so at his own risk, or Petitioner Viewmaster agreed to act as guarantor for the loan in
that he gambles on the result of the litigation over the property. consideration for its participation in a joint venture project to codevelop
the real estate assets of State Investment Trust, Inc. As a result of the
A purchaser who buys registered land with full notice of the fact that it is loans granted, Roxas gained control and ownership of the State
in litigation between the vendor and third party stands in the shoes of his Investment Trust, Inc.
vendor and his title is subject to the incidents and results of the pending However, notwithstanding the lapse of two years since becoming the
litigation. controlling stockholder, Roxas failed to take the necessary action to
implement the joint venture project with Viewmaster to co-develop the
REQUISITES OF A VALID LIS PENDENS subject properties.
I. There must be an action or proceeding affecting the title of real His continued inaction forced Viewmaster to file a complaint for speci0c
property on the possession thereof performance against State Investment Trust, Inc., its subsidiary
II. The court must have jurisdiction over the subject matter and the companies, and Allen Roxas.
property In connection with this, Viewmaster filed a Notice of Lis Pendens with the
III. That the property is sufficiently described in the complaint Register of Deeds for the annotation of a Notice of Lis Pendens on a
particular title in the name of State Properties Corporation, a subsidiary of
EFFECT OF SUCH NOTICE State Investment Trust, Inc.
1. It keeps the subject matter of the litigation within the power of the The respondent Register of Deeds of Las Piñas denied the request. On
court until the entry of final judgment so as to prevent the defeat of appeal, the Court of Appeals affirmed the ruling and held that petitioner
the latter by successive alienations failed to adequately describe the subject property in the complaint and in
2. It binds the purchaser of the land subject of the litigation to the the application for the registration of a notice of lis pendens.
judgment or decree that will be promulgated thereon whether such The CA also ruled that a notice of lis pendens can only be registered when
purchaser is a bona fide purchaser or not It is not correct to speak of an action directly affects the title to or possession of the real property,
it as part of the doctrine of notice, the purchaser pendent elite is which is not present in this case. Petitioner's complaint clearly warranted
affected not by notice but because the law doesn’t allow litigating the registration of a notice of lis pendens.
parties to give to others, pending the litigation, rights to the property ISSUE:
in dispute so as to prejudice the other party. Whether or not the property was not particularly described
Whether or not a notice of lis pendens is proper
WHEN ANNOTATION IS PROPER HELD:
As a general rule, the only instances in which a notice of lis pendens may Yes. A copy of the TCT was attached to and made an integral part of
be availed of are as follows: both documents. Consequently, the notice of lis pendens submitted for
1. Action to recover possession of real property registration, taken as a whole, leaves no doubt as to the identity of the
2. Action to quiet title thereto property, the technical description of which appears on the attached TCT.
3. Action to remove cloud thereon We stress that the main purpose of the requirement that the notice should
4. Action for partition contain a technical description of the property is to ensure that the same
5. Any other proceedings of any kind in court directly affecting the title to can be distinguished and readily identi0ed. In this case, we agree with
the land or the use or occupation thereof or the buildings thereon petitioner that there was substantial compliance with this requirement.
Additionally, this Court has held that resorting to lis pendens is not Yes. The Complaint shows that the loan obtained by Allen Roxas (one of
necessarily confined to cases that involve title to or possession of real the defendants in civil case) from First Metro was guaranteed by petitioner
property. for two distinct considerations: (a) to enable it to purchase 50 percent of
This annotation also applies to suits seeking to establish a right to, or an the stocks that the said defendant may acquire in State Investment and
equitable estate or interest in, a specific real property; or to enforce a lien, (b) to co-develop with the defendants the Quezon City and the Las Piñas
a charge or an encumbrance against it. properties of the corporation. In other words, the co-development of the
said properties is a separate undertaking that did not arise from
WHEN ANNOTATION IS NOT PROPER petitioner's acquisition of the defendant's shares in the corporation. To
1. Preliminary attachments repeat, the co-development is not merely auxiliary or incidental to the
2. Proceedings for the probates of wills purchase of the shares; it is a distinct considerations for Viewmaster's
3. Levies on execution guaranty.
4. Proceedings for the administration of estate of deceased persons Atty G’s comments: When it is a personal action like specific performance
5. Proceedings in which the only subject is the recovery of a money normally it does not pre detach of the ownership or possession of property.
judgment The property should be the list mota (subject proper) of the litigation. But
• By express provision of law, the doctrine of lis pendens does not apply SC expanded the interpretation of the notice of lis pendens, it includes also
to attachments, levies of execution, or to proceedings for the probate of all suits that seeks to establish a right to or an interest to the property for
wills, or for administration of the estate of deceased persons in the Court the enforcement of a lien, an encumbrance or a charge against him and it
of First Instance. Also, it is held generally that the doctrine of lis pendens is under the 2nd category where it was applied directly.
has no application to a proceeding in which the only object sought is the Generally a notice of Lis Pendens covers actions pending before the regular
recovery of a money judgment, though the title or right of possession to courts however, cases involving real property pending before
property be incidentally affected. administrative agencies such as the HLURB, SEC and the DARAB which are
• It is essential that the property be directly affected, as where the relief endowed with quasi-judicial functions have been recognized as proper
sought in the action or suit includes the recovery of possession, or the basis for the annotation of a Lis Pendens. Availability of lis pendens is not
enforcement of a lien, or an adjudication between conflicting claims of title, confined to cases involving the title to or possession of real property. It
possession, or the right of possession to specific property, or requiring its applies to suits brought to “establish an equitable estate, interest or right
transfer or sale. in specific real property or to enforce any lien, charge or encumbrance
against it.
PRINCIPLE OF PRIMUS TEMPORE, POTIOR JURE; EFFECT OF LIS
PENDENS Atlantic Erectors, Inc. vs Herbal Cove Realty
• The principle of primus tempore, potior jure gains greater significance in
the law on double sale of immovable property Principle: Not all liens are subject of lis pendens. The pendency of a
• Reliance on the principle of constructive notice operates only such upon simple collection suit arising from the alleged nonpayment of construction
the registration of the notice of lis pendens services, materials, unrealized income and damages DOES NOT justify the
Prepared by: Gas

annotation of a notice of lis pendens on the title to a property where is a mortgagee in good faith, but of whether or not HSLB is a purchaser in
construction has been done. good faith. And, HSLB is not such a purchaser.
A purchaser in good faith is defined as one who buys a property without
FACTS: Respondent and petitioner entered into a construction contract notice that some other person has a right to, or interest in, the property
whereby petitioner agreed to construct several townhouse units on and pays full and fair price at the time of purchase or before he has notice
respondent's land for a total of almost P17M. Later, petitioner filed a of the claim or interest of other persons in the property.
complaint against respondent for sum of money with damages and notice In the case at bar, HSLB utterly failed to take the necessary precautions.
of lis pendens annotated on respondent's land titles. At the time the subject property was mortgaged, there was yet no
Petitioner averred that its money claim on the cost of labor and materials annotated Notice of Lis Pendens. However, at the time HSLB purchased
for the townhouses it constructed on respondent's land was a proper lien the subject property, the Notice of Lis Pendens was already annotated on
that justi9ed the annotation of a notice of lis pendens on the land titles. the title. When a prospective buyer is faced with facts and circumstances
as to arouse his suspicion, he must take precautionary steps to qualify as
ISSUE: Whether or not the annotation of lis pendens is proper a purchaser in good faith.
Lis pendens is a Latin term which literally means, a pending suit or a
HELD: No. pending litigation while a notice of lis pendens is an announcement to the
A careful examination of petitioner's Complaint, as well as the reliefs it whole world that a real property is in litigation, serving as a warning that
seeks, reveals that no such lien or interest over the property was ever anyone who acquires an interest over the property does so at his/her own
alleged. The Complaint merely asked for the payment of construction risk, or that he/she gambles on the result of the litigation over the
services and materials plus damages, without mentioning — much less property.It is a warning to prospective buyers to take precautions and
asserting — a lien or an encumbrance over the property. Verily, it was a investigate the pending litigation.
purely personal action and a simple collection case. It did not contain any The purpose of a notice of lis pendens is to protect the rights of the
material averment of any enforceable right, interest or lien in connection registrant while the case is pending resolution or decision. With the notice
with the subject property. of lis pendens duly recorded and remaining uncancelled, the registrant
Even assuming that petitioner had sufficiently alleged such lien or could rest secure that he/she will not lose the property or any part thereof
encumbrance in its Complaint, the annotation of the Notice of Lis Pendens during litigation.
would still be unjustified, because a complaint for collection and damages Indeed, at the time HSLB bought the subject property, HSLB had actual
is not the proper mode for the enforcement of a contractor's lien. knowledge of the annotated Notice of Lis Pendens. Instead of heeding the
Article 2242 finds application when there is a concurrence of credits, i.e., same, HSLB continued with the purchase knowing the legal repercussions
when the same specific property of the debtor is subjected to the claims a notice of lis pendens details.
of several creditors and the value of such property of the debtor is
insufficient to pay in full all the creditors. Casim v. RD of Las Pinas
Homeowners Savings vs Delgado Facts:

 Petitioner represented by Casim is a domestic corporation who
Facts: had a TCT registered in its name. In 1982, petitioner acquired
• Felonia and De Guzman were the registered owners of a parcel of land the property through a Deed of Absolute Sale, and as a result,
coevered by TCT No. T-402 issued by the register of deeds In June the mother title was cancelled and a new one was issued.
1990, Felonia and De Guzman mortgaged the property to Delgado to  On March 22, 2004, the petitioner filed with RTC of Las Piñas City
secure the loan in the amount of ₱1,655,000.00. However, instead of an original petition for cancellation of the notice of lis
a real estate mortgage, the parties executed a Deed of Absolute Sale pendens as well as other entries of involuntary encumbrances in the
with an Option to Repurchase. original copy.
• On 20 December 1991, Felonia and De Guzman filed an action for  Casim claims that the owner’s duplicate copy of the TCT was
Reformation of Contract. RTC rendered a judgment favorable to clean at the time of delivery and was surprised to learn later on
Felonia and De Guzman on the findings that it is "very apparent that that the original TCT contained several entries – one of which is
the transaction had between the parties is one of a mortgage and not the notice of lis pendens (the notice of lis pendens was filed by
a deed of sale with right to repurchase.The CA affirmed the trial court Manalaysay for case Casim v. Sps. Casim & Chavez, Sps. Nobleza,
decision. On 16 October 2000, the CA decision became final and and Antonio in the Rizal Branch. – NOTE: It says Rizal Branch at
executory. the enumeration but says it was filed in Makati?)
• Inspite of the pendency of the Reformation case in which she was the  In order to justify cancellation, petitioner alleged that the notice
defendant, Delgado filed a "Petition for Consolidation of Ownership of of lis pendens was a forgery because there were inconsistencies
Property Sold with an Option to Repurchase and Issuance of a New in the signature and the fact that the notice was entered later than
Certificate of Title" (Consolidation case) in the RTC of Las Piñas, on that of the previous entry.
20 June 1994. After an ex-parte hearing, the RTC ordered the  Furthermore, petitioner stated that while Sec. 59 of PD 1529
issuance of a new title under Delgado’s name. requires that the existing notices be inscribed in the new
• Aggrieved, Felonia and De Guzman elevated the case to the CA issuances of TCTs, his duplicate copy contained nothing
through a Petition for Annulment of Judgment. which made him an innocent purchaser for value especially
• On 2 June 1995, Delgado mortgaged the subject property to since he was never a party to the civil case in the notice. Finally, he
Homeowners Savings and Loan Bank (HSLB) using her newly uses the indefeasibility of title despite the mother title containing
registered title. 3 days later, or on 5 June 1995, HSLB caused the defects.
annotation of the mortgage. On 20 November1997, HSLB foreclosed  The Intestate Estate of Bruneo Casim intervened, stating that
the subject property and later consolidated ownership in its favor, the RTC of Las Piñas did not have jurisdiction because
causing the issuance of a new title in its name, TCT No. 64668. cancellation of a notice of lis pendens lies within the jurisdiction of
• On 14 September 1995, Felonia and De Guzman caused the the court before which the main action referred to in the notice is
annotation of a Notice of Lis Pendens on Delgado’s title, TCT No. pending (basically, he says that it should have been filed in the
44848. Makati branch because that is where the notice of lis pendens
• On 27 October 2000, the CA annulled and set aside the decision of was issued).
the RTC, Las Piñas City in the Consolidation case.  He said that the notice referred to had attained finality as the SC
• The decision of the CA, declaring Felonia and De Guzman as the had issued an entry in judgment and that the RTC Makati had
absolute owners of the subject property and ordering the cancellation ordered execution. There was lack of legal basis for the petition
of Delgado’s title, became final and executory on 1 December 2000. because there is nothing that hints of any legal ground for
• On 29 April 2003, Felonia and De Guzman, represented by Maribel cancellation. As opposed to the allegations of there being no carry
Frias (Frias), claiming to be the absolute owners of the subject over to the duplicate copy, the original copy of petitioner’s TCT
property, instituted the instant complaint against Delgado, HSLB, had the same inscriptions as the mother title but not in the
Register of Deeds of Las Piñas City and Rhandolfo B. Amansec before duplicate copy. There was no lack of transaction record because
the RTC of Las Piñas City for Nullity of Mortgage and Foreclosure Sale, the certification issued by the RD merely stated that it could
Annulment of Titles of Delgado and HSLB, and finally, Reconveyance not be retrieved so it might be lost or destroyed.
of Possession and Ownership of the subject property in their favor.  (RTC RULING) It did not have jurisdiction – should be filed where
the main action was filed. Petitioner sought the wrong forum to
HSLB determine the existence of forgery and such existence cannot be
• Felonia and De Guzman are barred from laches as they had slept on presumed from non-chronological entry. (It did not go through CA)
their rights to timely annotate, by way of Notice of Lis Pendens, the  Petitioner arguments: Trial court erred in dismissing the case
pendency of the Reformation case. because the rule of following the main action does not always follow
• It should not be bound by the decisions of the CA in the Reformation – trial courts have an INHERENT power to cancel notices of lis
and Consolidation cases because it was not a party therein. pendens. The trial court is wrong for declining to rule on the
• Iit was a mortgagee in good faith because the mortgage between allegation of forgery because there is no transaction record with the
Delgado and HSLB was annotated on the title on 5 June 1995, RD. The fact that there is no inscription on the title shows he was
whereas the Notice of Lis Pendens was annotated only on 14 never a party to the case referred to in the title.
September 1995.  Intestate Estate of Casim arguments: reiteration of previous
• After trial, the RTC ruled in favor of Felonia and De Guzman as the arguments. The only difference is petitioner replied, stating that non-
absolute owners of the subject property. CA affirmed with chronology is the best evidence and that forgery of the notice
modifications the trial court decision (only relating to awards of constitutes a sufficient ground for cancellation.
damages & attorney’s fees)
Issue: Whether or not the notice of lis pendens may be validly
ISSUE: Whether or not HSLB is a mortgagee and a purchaser in good cancelled?
faith Ruling:
THE PURPOSE OF A NOTICE OF LIS PENDENS IS TO MAINTAIN
HELD: No. Decision of CA sustained. THE COURT’S POWER OVER THE PROPERTY UNTIL FINAL
JUDGMENT AND SERVES AS A WARNING.
Civil Law: Who is a Purchaser in good faith The rights of the parties to the  The petition is unmeritorious. Lis pendens means pending suit, and
present case are defined not by the determination of whether or not HSLB it refers to jurisdiction, power, or control that a court acquires over
the property involved in a suit pending the continuance of an action
Prepared by: Gas

and until final judgment. It is intended to keep the properties in Pineda v. Arcalas
litigation within the power of the court until the litigation is
terminated to prevent the defeat of judgment by subsequent Facts:
alienation. It serves as a warning that one who acquires an interest  The subject property contains 3 parcels of land which in total consists
over the property does so at his own risk. of 50,000 sq. m. These lots are portions of another lot under the
name of Spouses Lateo totaling 74, 708 sq. m. in Laguna.
DIFFERENT MODES OF CANCELLATION OF NOTICE OF LIS  Victoria Tolentino bought the property from Spouses Lateo. A
PENDENS; INHERENT POWER ARGUMENT FAILS suit for a Sum of Money was instituted by Arcalas against
Tolentino which was based on indebtedness shown by a
 Once it is duly registered, it may be cancelled by the trial court promissory note and four post-dated checks which were dishonored.
where action involving property is pending. Such power is Quezon City RTC rendered judgment in favor of Arcalas.
inherent and exercised under express provisions of law. Sec. 14  Pineda bought the subject property from Tolentino. He alleged
Rule 13 of the Rules of Civil Procedure authorizes the trial court that upon payment opf the purchase price, she took possession by
to cancel a notice of lis pendens where it is shown that the purpose allowing a tenant, Bautista to cultivate the same. However, she
of annotation is to harass the other party, or when it is not failed to register the property in her name.
necessary to protect the rights of the party who caused it to be  In order to execute judgment, RTC Quezon City levied the subject
annotated. property and the Notice of Levy on Alias Writ of Execution was
 The power to cancel is only in exceptional circumstances, like: annotated at the back of the TCT.
circumstances are imputable to party who caused annotation where  Pineda filed with the Deputy Sheriff an Affidavit of Title and Third-
litigation was unduly extended to the other party’s prejudice due Party Claim, but Arcalas filed a motion to set aside what
to several continuances, where the case where the notice was based Pineda filed. Arcalas’s motion was granted because the levies
on is cancelled because of non prosequitur (failure to appear to were registered while the Deed of Absolute Sale was not.
prosecute), or where judgment was rendered against party who  After finality of the order quashing the third-party claim, Pineda
caused the annotation. filed with the Office of the RD Laguna another Affidavit of
 Petitioner’s theory that it doesn’t always have to follow the main Third-Party Claim, causing the inscription of a notice of adverse
action due to inherent power to cancel fails. claim at the back of the TCT.
 (History of the Annotation) Bruneo Casim filed a case for  Arcalas and Perez purchased the lot at an auction sale
annulment of sale and recovery of real property against Jesus and evidenced by a sheriff’s Certificate of Sale issued on the same day
Margarita Casim – stockholders of the corporation - before the RTC and registered at the back of the TCT.
Makati. Makati RTC rendered a decision against Bruneo. CA reversed,  Arcalas filed an action for cancellation of the entry of Pineda’s
and an appeal to SC was dismissed for being filed out of time. adverse claim before Laguna RTC (Ruling), which ordered the
 It is a necessary incident of registering a notice of lis pendens that cancellation of the Notice of Adverse Claim on the ground of
the property is effectively placed under court’s power until litigation res judicata. This was given due course because the order was final
attains finality. It is in this sense that the power to cancel is inherent and executory with no relief being filed by Pineda.
as it is merely stemming from the main action.  (CA RULING) Dismissed case when it considered it
 (Vda. De Kilayko v. Judge Tengco, Heirs of Marasigan v. IAC, abandoned when Pineda failed to file her brief.
and Tanchoco v. Aquino) Precautionary notice of lis pendens may
be cancelled by court having jurisdiction over said action. The same TIMELINE: Spouses Lateo own land -> sold to Tolentino -> action
pronouncement was made in Heirs of Eugenio Lopez Sr. v. Enriquez against Tolentino for debt -> meanwhile, Tolentino sold to Pineda,
citing Magdalena Homeowners Association Inc. v. CA. failed to register -> Arcalas won, levy on execution on subject
 Thus, action should have been filed before the RTC Makati, not property -> Pineda filed dilatory tactics -> Arcalas had to keep
an original action before the court a quo. Even then, petition cancelling her claims -> Pineda epic failed and got KO’d at the CA.
could not be pursued in the proper forum as decision in the
annulment case already attained finality. The notice has already Issue: Whether the Alias Writ of Execution exempted Pineda’s
pursued its purpose. portion. – NO.
 However, petitioner is not totally out of options. The suitable course Whether possession of her portion is already equivalent to a title.
of action is only judicial however, using Sec. 77 of PD 1529 to – NO.
cancel the notice. This is by presenting to the RD a certificate
executed by the clerk of court before which the main action was Ruling:
pending, having it registered.  (Unimportant procedural law) The petition must be dismissed.
 The argument of forgery was declined a decision since it requires CA properly dismissed the case for failure to file a brief in accordance
factual determination. with Sec. 7 Rule 44 of the RoC, imposing upon the appellant the duty
to file an appellant’s brief in ordinary appealed cases before the CA.
In special cases appealed to CA like certiorari, a memorandum of
E. Levies on Execution appeal must be filed in place of an appellant’s brief (Sec. 10 Rule 44
of RoC). Failure to file will be a ground for dismissal. An appellant’s
A. Registration of the Levy on Execution brief is required to put the assigned errors in formally. (Casim v.
B. Registration of the Certificate on Sale Flordeliza) The dismissal of the case was done because the brief was
C. Sheriff’s Final Deed of Sale delayed and fell short of some requirements. Pineda did not even
D. Petition for Issuance of a New Certificate of Title pursuant to provide justification for failure to file an appellant brief.
Sec. 75 of P.D. 1529  (Still unimportant procedural law) Pineda clearly intended to
delay termination of the case because Quezon RTC already quashed
WRIT OF ATTACHMENT her third-party claim, yet she filed another adverse claim before the
The Court held that a registered writ of attachment is a proceeding in RD of Laguna, which Arcalas had to again cancel. She then filed a
rem. It is against a particular property, enforceable against the whole dilatory appeal and then two motions for reconsideration.
world. The attaching creditor acquires a specific lien on the attached  Pineda avers that she is not a party to the Civil Case and that the
property which nothing can subsequently destroy except the very levy on the alias writ of execution can’t affect her subject property,
dissolution of the attachment or levy itself. An exception to the but this is contrary to law.
preference given to a registered lien is the case where a party has actual
knowledge of the claimant’s actual, open, continuous and notorious A REGISTERED LEVY ON EXECUTION IS SUPERIOR TO A
possession of the disputed property at the time the levy or attachment is PRIOR UNREGISTERED SALE
registered.
 Sec. 51 and 52 of PD 1529 – A purchaser of land causes the
COMMON REGISTRATION PROBLEMS registration of the transfer of the subject property in her favor, third
CAUTIONARY NOTICE persons like Arcalas cannot be bound. Insofar as third persons are
Under the Spanish Mortgage Law, this was a procedure intended to concerned, it is the registration of the deed that transfers or
maintain the right of priority of the interested party while he goes about conveys a person’s interest in real property. Because it was
correcting the defect of his document. The Spanish Mortgage Law as a unrecorded, the deed of sale merely operated as a contract between
system of registration has been discontinued as of June 11, 1978 by Sec. Tolentino as the seller and Pineda as the buyer. Levy on execution
3 of P.D. 1529. duly registered takes preference over a prior unregistered
sale.
OPPOSITION FILED BY LAWYERS  (Valdevieso v. Damalerio) Registered writ of attachment was a
A mere opposition from a lawyer or a third person who claims an adverse superior lien on an unregistered deed of sale because an
interest in the property involved in a transaction is not sufficient to justify attachment is a proceeding in rem. Nothing can destroy such lien
the Register of Deeds in denying the registration of a voluntary except the dissolution of the attachment or levy itself. It continues
instrument. (LRC Consulta No. 259) until debt is paid or sale is had under execution issued on the
Litigious matters are to be decided, and the appropriate relief granted, judgment.
not by the Register of Deeds, but by a court of competent jurisdiction.  Pineda also argues that her possession cures the defect caused
(LRC Consulta No. 57) by her failure to register the subject property in her name. It
is inaccurate and inapplicable.
CARRYOVER OF ENCUMBRANCES  Notwithstanding the preference given to a registered lien, the Court
Sec. 59 of P.D. 1529 provides: “If at the time of any transfer, subsisting has made an exception in a case where a party has actual
encumbrances or annotations appear in the registration book, they shall knowledge of claimant’s open, actual, and notorious
be carried over and stated in the new certificate except so far as they possession at the time the levy or attachment was registered.
may be simultaneously released or discharged. Under this situation, the actual notice and knowledge of a prior
- Exception: Upon a proper foreclosure of a prior mortgage, all unregistered interest, not the mere possession was held to be
liens subordinate to the mortgage are likewise foreclosed, and equivalent to registration.
the purchaser at public auction acquires the title free from the  Pineda didn’t even allege or prove that Arcalas had actual
subordinate liens. (PNB vs. ICB 199 SCRA 500) knowledge of her claim of ownership and possession at the
time the levy was registered. It cannot be equivalent to
registration.
Prepared by: Gas

REGISTRATION OF JUDGEMENTS, ORDERS;

Valdevieso v. Damalerio
PARTITIONS (SEC. 78-92)
Facts:
Surrender of Owner’s Duplicate (Sec. 107, PD 1529)
 Valdevieso bought from Spouses Uy a parcel of land in General
Santos City. The deed of sale was not registered, nor was the
Section 107. Surrender of withhold duplicate certificates. Where it is
title of the land transferred to the petitioner.
necessary to issue a new certificate of title pursuant to any involuntary
 The property was declared by petitioner for taxation purposes
instrument which divests the title of the registered owner against his
with the City Assessor’s Office.
consent or where a voluntary instrument cannot be registered by reason
 On April 19, 1996, Spouses Damalerio filed with RTC a
of the refusal or failure of the holder to surrender the owner's duplicate
complaint for a sum of money against Spouses Uy with an
certificate of title, the party in interest may file a petition in court to compel
application for the issuance of a Writ of Preliminary
surrender of the same to the Register of Deeds. The court, after hearing,
Attachment.
may order the registered owner or any person withholding the duplicate
 The trial court issued the writ by virtue of which the property
certificate to surrender the same, and direct the entry of a new certificate
was levied.
or memorandum upon such surrender. If the person withholding the
 Meanwhile, it was registered with the RD of General Santos City and
duplicate certificate is not amenable to the process of the court, or if not
annotated on the TCT. The name of Lorenzo Uy was cancelled
any reason the outstanding owner's duplicate certificate cannot be
and then issued to the name of Valdevieso.
delivered, the court may order the annulment of the same as well as the
 Petitioner then filed a third-party claim to discharge or annul
issuance of a new certificate of title in lieu thereof. Such new certificate
the attachment levied on the property on the ground that the
and all duplicates thereof shall contain a memorandum of the annulment
said property belongs to him and no longer to Spouses Uy.
of the outstanding duplicate.
 (TRIAL COURT RULING) Citing Manliguez v. CA and Santos v.
Bayhon, it held that the levy of the property by virtue of attachment
REMEDY WHERE DUPLICATE CERTIFICATE IS WITHHELD
is lawful only when the levied property belongs to the
• In case the person in possession of the owner’s duplicate certificate
defendant. Although Uy was the registered owner, he was no longer
refuses or fails to surrender the same to the RD so that any
the owner as it was sold to petitioner, so writ of attachment was
involuntary or voluntary instrument may be registered and a
unlawful.
certificate issued, the party in interest may file a petition in court to
 (CA RULING) reversed the resolution. An attachment or levy of
compel the surrender of the same to the RD.
execution despite being made later, takes precedence over the sale
• The court after hearing may order the registered owner or any person
if it was registered before the sale was registered. The writ of
withholding the duplicate certificate and direct the entry of a new
attachment being recorded ahead of the sale will take
certificate or memorandum upon such surrender
precedence.
• If the person withholding the certificate is not amenable to the
process of the court, or if for any reason the certificate cannot be
Issue: Whether or not a registered writ of attachment on the land delivered, the court may order the annulment of said certificate and
is a superior lien over that of an earlier unregistered deed of sale. the issuance of a new certificate of title in lieu thereof
• Such new certificate and all duplicates thereof shall contain a
memorandum of the annulment of the outstanding duplicate.
Ruling:
REGISTERED WRIT OF ATTACHMENT ON LAND IS SUPERIOR OVER PETITION TO SURRENDER TITLE MAY BE FILED AS AN INCIDENT
THAT OF AN EARLIER UNREGISTERED SALE; IT IS THE FACT OF IN
REGISTRATION THAT BINDS THIRD PERSONS. AN ACTION AFFECTING SAID TITLE
 Petitioner maintains that he has a superior right over the • Where the court in an action for specific performance, upheld the sale
questioned property because when the same was attached, it was to the plaintiff and ordered the defendant to comply with the terms
no longer the property of Spouses Uy. The ownership was then and conditions to the sale, it was proper for the plaintiff to ask the
transferred. He avers that he did not sleep on his rights because court to compel the defendant to surrender the duplicate certificate
he worked out for the transfer of registration in his name. It of title to the RD for the registration of the sale, this being a necessary
was the fault of the process for taking too long. It is only equitable incident in the main case
that he gets the property. • Section 107 doesn’t preclude a party to a pending case to include as
 Respondents on the other hand, state that the registration of incident therein the relief stated under said section, specially if the
a deed of sale is the operative act which binds the land and certificate of title to be surrendered is intimately connected with the
creates a lien thereon. Before that, third persons cannot be subject matter of the principal action
bound. Because the writ of attachment was registered earlier than • Where the title is subject to a mortgage, the order of the court cannot
the deed of sale, their writ enjoys preference over the deed of sale. in any way prejudice the rights of the mortgagee since any lien
Art. 1477 and 1498 do not apply because they only apply annotated in the certificate is incorporated or carried over to the new
between parties to the deed of sale. What binds third parties is transfer certificate of title to whoever it is issued
registration of the instrument. Finally, petitioner cannot invoke
equity unless there is an absence of a specific provision on AUTHORITY OF COURT TO ORDER THE SURRENDER OWNER’S
the matter and the person who invokes it is not guilty. DUPLICATE
However, Sec. 51 of PD 1529 is the law on the matter. CERTIFICATE
 SC agrees with the respondents. Although the subject land was • In order that the court may order the registered owner to surrender
given to the petitioner as early as Dec. 5, 1995, it wasn’t until June his owner’s duplicate, it has to determine upon the evidence
6, 1998 that the conveyance was registered. During that time gap, presented by the parties whether the registered owner had been
the land was already subjected to a levy on attachment. At the time lawfully divested of his title thereto
of attachment on April 23, 1996, Spouses Uy were still the registered • That of course requires and involves of the determination of the
owners of the property. question of title to the registered property
 What validly transfers or conveys a person’s interest in real • Section 107 doesn’t constitute a reopening of the decree entered as
property is the registration of the deed. When petitioner a result of proceedings in rem for the confirmation of imperfect title
bought the property, it was nothing more than a private under said act, it cannot be deemed to contravene the purpose or aim
transaction between him and Spouses Uy. His registration on of the Torrens system
June 6, 1996 was already too late since the attachment was already
made. Abad v. Filhomes Realty
 Settled is the rule that levy on attachment, duly registered,
takes preference over a prior unregistered sale. This result is a Facts:
necessary consequence of the fact that the property involved was  Fil-Homes Realty and Development Corporation and Magdiwang
covered by the Torrens system which works under the fundamental Realty Corporation (respondents), co-owners of two lots, filed a
principle that registration is the operative act which gives validity to complaint for unlawful detainer against above-named
the transfer or creates a lien upon the land. petitioners (Abad et. al) before the MeTC.
 The subsequent registration of the prior sale does not  Respondents alleged that petitioners, through tolerance, had
diminish the preference because the levy on attachment is a occupied the subject lots since 1980 but ignored their
proceeding in rem. It is a specific lien on the attached property repeated demands to vacate them.
which nothing can destroy except the very dissolution of the  Petitioners countered that there is no possession by tolerance for
attachment or levy itself. The property is an indebted thing and a they have been in adverse, continuous and uninterrupted
virtual condemnation of it to pay the owner’s debt. It continues until possession of the lots for more than 30 years; and that
debt is paid, sale is had under execution, or until judgment is respondents’ predecessor-in-interest, Pilipinas Development
satisfied, or attachment is discharged by law. Corporation, had no title to the lots. In any event, they contend that
 The attachment in favor of respondents appeared in the nature of a the question of ownership must first be settled before the
real lien when petitioner had his purchase recorded. So, the issue of possession may be resolved.
recording of title and ownership of petitioner’s was not an  On June 30, 2004, while the case is still pending, the City of
absolute but a limited right which was subject to the prior Parañaque filed expropriation proceedings (thru its power of
registered lien. eminent domain) covering the lots before the Regional Trial Court of
 The reliance on Manliguez v. CA and Santos v. Bayhon is Parañaque with the intention of establishing a socialized
misplaced. It did not deal with the same situation. In Santos, it was housing project therein for distribution to the occupants including
machinery that were executed on the ruling of NLRC. It never petitioners. A writ of possession was consequently issued and
appears whether such was registered. Basically, both cases never a Certificate of Turn-over given to the City.
had the registration of sale as an issue.  Petitioners contested that they have a better right on the land
 While it is aware of its equity jurisdiction, it is a court of law. Equity since they are beneficiaries of the expropriation proceedings but
cannot be enforced as to overrule the provisions of law. Dura lex sed nowhere in the ordinance stated any beneficiaries.
lex.  (METC RULING) The MeTC rendered judgment (in the unlawful
detainer case) in favor of the respondents ordering plaintiffs to
Prepared by: Gas

vacate and surrender possession of the premises. But since no ASSURANCE FUND
payment (just compensation for the expropriation?) had been made
yet to respondents for the lots, the MeTC held that they
CHAPTER 7 (SEC. 93 – 102)
(respondents) still maintain ownership thereon. It added that
Claims against Assurance Fund (Sec. 95)
petitioners cannot claim a better right by virtue of the issuance of a
Writ of Possession for the project beneficiaries have yet to be named.
Section 95. Action for compensation from funds. A person who, without
 (RTC RULING) The RTC reversed the MeTC decision and
negligence on his part, sustains loss or damage, or is deprived of land or
dismissed respondents’ complaint on the ground that there was no
any estate or interest therein in consequence of the bringing of the land
toleration and therefore the unlawful detainer case must not
under the operation of the Torrens system of arising after original
prosper; and (1) the issuance of a writ of possession in favor of
registration of land, through fraud or in consequence of any error,
the City bars the continuation of the unlawful detainer
omission, mistake or misdescription in any certificate of title or in any entry
proceedings, and (2) since the judgment had already been rendered
or memorandum in the registration book, and who by the provisions of this
in the expropriation proceedings which effectively turned over the
Decree is barred or otherwise precluded under the provision of any law
lots to the City, the MeTC has no jurisdiction to disregard the
from bringing an action for the recovery of such land or the estate or
final judgment and writ of possession due to non-payment of
interest therein, may bring an action in any court of competent jurisdiction
just compensation.
for the recovery of damages to be paid out of the Assurance Fund.
 (CA RULING) The respondents appealed to the CA and the appellate
court ruled in favor of respondents. It held that petitioners’
REQUISITES:
occupation of the property without the permission of the
previous owner — Pilipinas Development Corporation — as an 1. Person suffers LOSS/DAMAGE/DEPRIVATION of any ESTATE or
indicium of tolerance by respondents' predecessor-in-interest,
INTEREST IN LAND
ruled in favor of respondents. It also held that (2) the issuance of
a writ of possession in the expropriation proceedings does not signify 2. On account of BRINGING LAND UNDER the operation of the TORRENS
the completion of the expropriation proceedings. SYSTEM arising AFTER original registration
Issue: WON the expropriation proceedings initiated by the City of 3. Thru FRAUD, ERROR, OMISSION, MISTAKE OR MISDESCRIPTION in a
Parañaque bars the continuation of the unlawful detainer case. certificate of title or entry or memorandum in the registration book
WON the issuance of a writ of possession signifies the completion
of the expropriation proceedings and thus transferred ownership 4. WITHOUT NEGLIGENCE on his part [he protected his interests]
of the subject land to the City.
Ruling: 5. He is BARRED OR PRECLUDED from bringing an ACTION FOR THE
EJECTMENT PROCEEDINGS ARE NOT IMMEDIATELY SUSUPENDED; RECOVERY of such land or estate or interest therein
REQUIRES PAYMENT OF RENT
 As a general rule, ejectment proceedings, due to its summary WHAT CONSTITUTES ASSURANCE FUND?
nature, are not suspended or their resolution held in abeyance
despite the pendency of a civil action regarding ownership. However, Upon the original registration of land under the Land Registration Act, and
Section 1 of CA 538 provides: also upon the entry of a certificate showing title as registered owners in
heirs of devisees, there is required to be paid to the register of deeds one-
Section 1. “when the Government seeks to acquire, through tenth of one per centum of the assessed value of the real estate on the
purchase or expropriation proceedings, lands belonging to any basis of the last assessment for the municipal taxation. This constitutes
estate or chaplaincy (cappellania), any action for ejectment what is known Assurance Fund.
against the tenants occupying said lands shall be automatically
suspended, for such time as may be required by the PURPOSE:
expropriation proceedings OR the necessary negotiations for the
purchase of the lands, in which latter case, the period of Assurance Fund is created for the purpose of paying any damages which
suspension shall not exceed one year. To avail himself of the may result from an improper or illegal registration. It is intended to relieve
benefits of the suspension, the tenants shall pay to the innocent persons from the harshness of the doctrine that a certificate is
landowner the current rents as they become due or deposit conclusive evidence of an indefeasible title to land, and from any injustice
the same with the court where the action for ejectment has been which may arise to them by operations under the Land Registration Act,
instituted.” whether such injustice arises from the fraud or error of someone connected
 Petitioners did not comply with any of the acts mentioned with the registry office or some third person dealing with the land.
in the law to avail of the benefits of the suspension. They
nevertheless posit that since the lots are the subject of CLAIMS AGAINST THE ASSURANCE FUND
expropriation proceedings, respondents can no longer assert a
better right of possession; and that the City Ordinance • Section 95 provides a remedy where a person who sustains loss or
authorizing the initiation of expropriation proceedings damage or is deprived of any estate or interest in land in consequence of
designated them as beneficiaries of the lots, hence, they the operations of the Torrens system of registration, without negligence
are entitled to continue staying there. on his part, may bring an action for the recovery of damages to be paid
out of the Assurance fund
EXPROPRIATION IS COMPLETED UPON DETERMINATION OF • Public policy demands that those unjustly deprived of their rights over
PROPRIETY AND JUST COMPENSATION real property by reason of the operation of our registration laws be
 It is only upon the completion of the two stages that an afforded remedies
expropriation can be said to have been completed. The process • According to the principles of the Torrens system, it is a condition sine
is not complete until payment of just compensation. To que non that the person who brings an action for damages against the
effectuate the transfer of ownership, it is necessary for the NPC Assurance fund be the registered owner, and as to holders of transfer
to pay the property owners the final just compensation. certificates of title that they be innocent purchasers in good faith and for
 Expropriation of lands consists of two stages: value
 The first phase is concerned with the determination of the • There must also be a showing of loss or damage or deprivation of any
authority of the plaintiff to exercise the power of eminent land or interest thereon by the operation of PD1529
domain and the propriety of its exercise in the context of • Where plaintiff is solely responsible for the plight in which it finds itself,
the facts involved in the suit. It ends with an order, if not of the Director of Lands and the National Treasurer are exempt from any
dismissal of the action, "of condemnation declaring that the liability
plaintiff has a lawful right to take the property sought to be
condemned, for the public use or purpose described in the Register of Deeds Negros Occidental v. Anglo Sr.
complaint, upon the payment of just compensation to be
determined as of the date of the filing of the complaint. (KEEP IN MIND: Atty. Gimarino wanted us to read the case because
 The second phase of the eminent domain action is concerned the case shows how to strike a balance between good faith and the
with the determination by the court of "the just compensation caveat emptor principle).
for the property sought to be taken." This is done by the Facts:
court with the assistance of not more than three (3)  de Ocampo filed an application before the Court of First
commissioners. Instance of Negros Occidental 2 to register two parcels of
 It is only upon the completion of these two stages that prime sugar land. This was contested by the Bureau of
expropriation is said to have been completed. The process Education (Republic).
is not complete until payment of just compensation.  The Republic argues that the lots de Ocampo sought to registered
were given to the Bureau of Education by Jalandoni in 1926.
WRIT OF POSSESSION DOES NOT FINISH As such, the Bureau owned the lots evidenced by their TCTs.
PROCEEDINGS; PAYMENT OF JUST COMPENSATION  While registration proceedings were pending, de Ocampo entered
EFFECTUATES TRANSFER OF OWNERSHIP. into an agreement with Anglo Sr. in 1926. It was a Deed of
Conditional Sale that de Ocampo would transfer one lot
 Accordingly, the issuance of the writ of possession in this entirely and a part of the other lot under certain conditions.
case does not write finish to the expropriation  On Dec. 28, 1965, the Republic filed a Petition for Relief from
proceedings. To effectuate the transfer of ownership, it is judgment with Preliminary Injunction Pending Proceeding
necessary for the NPC to pay the property owners the final just before the CFI in San Carlos City.
compensation.  In 1966, Ocampo sold what was agreed upon in the conditional sale.
 In the present case, the mere issuance of a writ of The deed was registered and annotated at the back of the
possession in the expropriation proceedings did not OCT, which was cancelled. A new TCT covering the lots was issued
transfer ownership of the lots in favor of the City. Such in favor of Anglo Sr.
issuance was only the first stage in expropriation. There is even  On a later date (March 3 and August 24, 1966), the Republic
no evidence that judicial deposit had been made in favor annotated notices of lis pendens in Anglo’s TCT.
of respondents prior to the Citys possession of the lots,
contrary to Section 19 of the LGC.
Prepared by: Gas

 (CFI RULING ON PETITION FOR RELIEF) Dismissed. The appeal inspect the real property’s CT. The purchaser is required to be
before the CA was also dismissed. An appeal by certiorari was filed aware of the supposed title and one who buys without checking takes
to the court, entitled Republic v. CA. all the risks and losses consequent to such failure. Their rights are
 Despite the notice of lis pendens, Anglo Sr. conveyed the lots always limited by the rights of the seller as stated in the CT. It is not
to Anglo Agricultural Corporation (the Corporation) in enough that buyers rely on the CT presented by their seller. They
exchange for shares of stock. In the Deed of Conveyance, Anglo have to check whether it corresponds to the public record of
Agricultural Corporation assumed the risk of an adverse decision the certificate in the RD. Each buyer presumes that the seller
as stated in the notices of lis pendens. may not provide complete information (economics – called
 After a new CT was given to the Corporation, they amended the information asymmetry).
agreement such that Anglo Sr. would assume all risks in case of an  Such asymmetry is corrected by making sure the pertinent
adverse decision. information is of public record. It goes through a process that is
 (REGARDING THE CASE PENDING IN SC) The court remanded in rem and binds not only the government but the entire world.
the case back to the CA to be decided on its merits and was Without the Torrens system, there would be a requirement for
reinstated in 1983. The CA rendered a decision against de Ocampo, meticulous due diligence and more expenses in hiring lawyers.
which declared the OCT in favor of de Ocampo and the TCT in Anglo’s  However, the Torrens System is not infallible because fraud or
name null and void, ordering cancellation. The case was remanded error may occur, letting a person who is not the owner acquire a
to the RTC for execution. certificate of title over the property. That is why there is an
 The RD of Negros Occidental wrote a letter to Anglo requiring him Assurance Fund.
to surrender his TCT, and he complied.  According to PD 1529, for every CT issued to a registered owner,
 On April 1988, Anglo Sr and Anglo Agricultural Corporation filed a the owner contributed ¼ of 1% of the assessed value of the real
Complaint for Recovery of Damages from the Assurance Fund estate on the basis of the last assessment for taxation purposes. This
against the RD and National Treasurer of the Philippines, is to contribute to the Assurance Fund. If it has not yet been
stating that Anglo Sr. acquired the lots in good faith and for value assessed, the contribution will be based on the value determined by
without negligence. two disinterested persons, pooled together under the custody of the
 The only remedy left for Anglo Sr. and the Corporation was to National Treasurer.
recover the value of the lots from the Assurance Fund  (Estrellado v. Martinez) The assurance fund is to safeguard rights
according to Act. No 496 and PD 1529. This is because de Ocampo of prejudiced parties rightfully entitled to an interest in land but shut
already died without any property left to his heirs. off from obtaining titles thereto. It is not intended to block any right
 During trial, only Anglo Sr. and the Corporation presented witnesses. which a person might have against another for the loss of his land.
Atty. Lozada confirmed that there were no annotations of notices of Damages cannot be recoverable from the assurance fund if it can be
lis pendens in the OCT at the time of sale. Anglo Sr. testified that de recovered from the person who caused the loss. It is to relieve
Ocampo possessed the lots prior to the sale. The RD and National innocent persons from the harshness of a certificate being conclusive
Treasurer did not file an Opposition. They only submitted a evidence of an indefeasible title.
Memorandum.  (Spouses de Guzman Jr. v. National Treasurer) Two types of
 (RTC RULING) Awarded damages in favor of Anglo Sr. and the claimants under the Assurance Fund and requirements: (note:
Corporation, computing the fair market value at the time the NOT AS USEFUL NA NI. For purposes of discussion nalang
Corporation suffered the loss. gyud ugh *eyeroll*).
 (CA RULING) The CA affirmed the award of damages because it
fell within the requisites of Sec. 95 of PD 1529 but excluded A. Person who sustains loss or damages under the condition that:
attorney’s fees. (1) no negligence on his part, and (2), the loss was sustained through any
 RD and National Treasurer Arguments before the SC: Anglo Sr. omission, mistake, or malfeasance of court personnel, RD, his deputy, or
is a purchaser in bad faith. He was negligent because he didn’t other employees of the Registry in the performance of respective duties
ascertain the legal condition of the title of the property he was under the Property Registration Decree (PRD).
buying. He purchased the properties with the OCT having entries in B. Any person who has been deprived of any land under the
its Memorandum of Incumbrances. condition that: (1) no negligence on his part, (2) he was deprived as a
 Anglo Sr. and the Corporation’s loss was caused by the fraud consequence of bringing his land or interest under the provision of the PRD
committed by de Campo in registering and obtaining his OCT. or by registration by any other person as owner of land, or by mistake,
Contrary to the CA’s ruling, they were precluded from the assurance omission, misdescription in any certificate of owner’s duplicate, or in any
fund because they could not show that they were deprived of their entry/memorandum in the register or other official book, or by any
lots as a consequence of bringing the lots or interest under the cancellation, and (3) he is barred or in any way precluded from bringing
provisions of PD 1529 (this was because de Ocampo was not the real an action for recovery of such land or claim upon the same.
owner of the lots) or because registration was made my mistake, HOWEVER, ANG GI-LISTA DIAY DIRI KAY GIKAN DIAY SA ACT NO.
omission, or misdescription in any certificate or owner’s duplicate. 496 -_-. NAAY MAS BAGO NGA LAW GIKAN SA PD 1529 NA
 In addition to this, they argue that Anglo Sr. and the Corporation REQUISITES…
failed to include de Ocampo as a party. According to PD 1529 (REVELANT) PD 1529 REQUISITES:
Sec. 97, the law requires that if the deprivation is caused by persons (1) Individual must sustain loss or damage, or individual is deprived of
other than the government, it should first be brought against such land or any estate or interest,
person – de Campo. (2) individual must not be negligent,
 Anglo Sr. and Anglo Agricultural Corporation Arguments: They (3) loss, damage, or deprivation is a consequence of either:
are entitled to a claim from the Assurance Fund because Anglo Sr. (a) fraudulent registration under the Torrens system after original
purchased the lots in good faith and for value, so a legitimate TCT registration,
was issued in his name. No negligence could be attributed because (b) any error, omission, mistake, or misdescription in any CT or in any
he relied on an OCT. Loss was not due to a breach of trust but was entry or memorandum in the registration book,
caused by fraud from the original owner in obtaining the OCT. (4) individual must be barred or precluded under law from bringing an
 Contrary to failing to implead de Ocampo, they argue that it is action for the recovery of such land or the estate or interest therein.
allowable because de Ocampo already died several years before the  (La Urbana v. Bernardo) It is a condition sine qua non that the
suit was filed and had no property left. person who brings an action for damages against the assurance fund
be the registered owner, or in the case of TCTs, they are innocent
TIMELINE: de Ocampo registers land -> Bureau of Education purchasers in good faith and for value.
opposes; files petition for relief-> de Ocampo sells land to Anglo  (Gayondato v. Treasurer of the Philippine Islands) erroneous
Sr.; new TCT given to Anglo -> BoE annotates notice of lis pendens registration of property leading to the exclusion of one of the co-
on TCT -> Despite this, Anglo conveys property to Corporation -> owners. Excluded owner was a minor and was not negligent, so the
SC ruling on case annuls TCT (check case timeline) -> Claim for treasurer was secondarily liable for the disenfranchised co-owner’s
Recovery of Damages -> RTC and CA grant petition -> SC denied claim for damages.
claim for recovery.  (Treasurer of the Philippines v. CA) Seller is not the real owner
CASE TIMELINE: WHILE CONTESTING LAND, petition for relief by of the property but pretended to be. After 2 years, real owner
BoE thru Republic -> Went to SC -> remanded to CA; TCT null and discovered the sale and sued to have the sale made. The claim was
void -> RTC for execution -> Surrender of Duplicate Copy denied because the sale did not convey any title or interest to the
Issue: Whether or not Anglo Sr. and the Corporation are entitled to buyers because the vendor had no title or interest in the first place.
damages from the Assurance Fund under Sec. 95 of PD 1529.  HOWEVER, Spouses de Guzman or the Treasurer cases do not
Whether or not Anglo Sr. and the Corporation should have apply here. Here, there are two different CTs, one in favor of de
impleaded de Ocampo in their Complaint. Campo and the other to the Bureau for the same lots. In the two
Ruling: cases, the titles involve the same certificate of title.
THEY ARE NOT ENTITLED TO DAMAGES SINCE ANGLO SR. SOLD  We need to DEPART FROM THE RULE IN BOTH CASES THAT
HIS INTEREST TO THE CORPORATION; THE CORPORATION WAS THE SALE CONVEYED NO INTEREST BECAUSE VENDOR HAD
IN BAD FAITH FOR BEING AWARE OF THE NOTICES UPON NONE ALSO. INNOCENT PURCHASERS SHOULD NOT BE
TRANSFER PREJUDICED BY INDIVIDUALS WHO ONLY APPEAR TO BE
OWNERS BUT ARE NOT THE ACTUAL OWNERS.
 They do not meet the criteria to recover damages. Although
Anglo Sr. acted in good faith, he no longer had an interest over BOTH PARTIES HERE MUST BE TREATED SEPARATELY;
the lots after he had transferred these to the Corporation for  Although the Corporation and Anglo Sr. have similar interests,
shares of stock. The Corporation cannot be considered a transferee they have to be treated as separate entities with different legal
in good faith since it was aware of the notices of lis pendens. personalities to evaluate compliance with Section 95. The RTC
 Every certificate of title contains an attestation that the person and CA both saw them as single parties.
named is the owner of the property described in the certificate. When  Anglo Sr. meets the second requirement as he was a buyer in
a certificate is clean and free from any encumbrance, purchasers good faith. The encumbrances in the OCT did not include claims
have every right to rely on such certificate. Those who rely on of the Republic at the time Anglo bought the lots. He however
such are referred to as innocent purchasers for value and in did not meet the 1st and 3rd requirements. There was no error in
good faith. de Ocampo’s CT, and the fraudulent registration is not the cause
 The Court has also recognized the rule of caveat emptor. To of the loss suffered by Anglo Sr.
exercise the diligence required, each potential buyer must
Prepared by: Gas

 He sold the lots to the Corporation and got shares with values of and 28/100 (P562,955.28) Pesos on or before, March 30, 1970, while
P100.00 each. He could not have suffered loss since he was able the spouses bound themselves to execute and deliver, within ten (10)
to recover money from the sale. Anglo Sr. only suffered loss days from receipt of the sum mentioned such documents as are
because of the subsequent agreement between him and the necessary to release the mortgages in favor of defendants on
corporation. The undertaking caused loss for respondent Anglo plaintiffs' property.
Sr. and not de Ocampo’s fraudulent registration. HE SUSTAINED  Before Fernandez could pay his obligation under the settlement
A LOSS UNDER A DIFFERENT CAPACITY. agreement, a decision was rendered in Civil Case No. 72494 where it
 Whatever good faith sustained by Anglo Sr. transaction no was declared that the proceedings held in LRC GLRO Cad. Rec.
longer existed because the adverse claim was already annotated No. 133 was void and that TCT No. 86018, issued in the name
through notices of lis pendens on the TCT. Anglo Agricultural of Fernandez, is without force and effect as TCT No. 53628 in the
Corporation already knew of conflicting claims of ownership over name of Torres is the true and legal evidence of ownership of the
the lots. subject immovables.
 Fernandez appealed from this decision to the Court of Appeals where
BOTH PARTIES HERE MUST BE TREATED SEPARATELY; BOTH DO it was docketed as CA-G.R. No. 46386-R. The Court of Appeals, on
NOT MEET THE REQUISITES FOR ANGLO SR.’S LOSS WAS NOT April 20, 1979, affirmed the decision of the trial court. There being
DUE TO MISTAKE FROM THE CERTIFICATE; THE CORPORATION IS nothing on the records that would indicate that the judgment of the
IN BAD FAITH AND IS NEGLIGENT appellate court was elevated here, it would appear that it had become
 The Corporation is presumed to have taken cognizance of the final and executory.
notices. Its act of entering into a Deed of Conveyance is an act  But meanwhile, prior to the Court of Appeals' decision
of negligence on the part of the Corporation. So, the act fails to mentioned above, Fernandez failed to comply with his
comply with the second requirement. obligation under the amicable settlement and whereupon the
 (Leyson v. Tañada) Certificate of title also contained a notice of Cues applied for and were granted a writ of execution.
lis pendens before the property was sold at a public auction. The  The subject realties were then levied upon and sold at public
court decided that the purchaser in the public auction was bound auction where Rosario Mota was the highest bidder.
by the pending litigation. Such is also true for the Corporation  On August 31, 1971, the redemption period for the subject
for being aware of the notices. immovables having lapsed without Fernandez nor Torres redeeming
 The Corporation also does not meet the first requirement the properties, Rosario Mota was issued the Sheriff's Deed of Sale.
because it is Anglo Sr. who undertook all liability according to Thereafter, TCT No. 86018 was cancelled and TCT No. 105953 was
their agreement in June 7, 1976. issued in her name.
 With regard to the 3rd requirement, the Corporation is not  On December 7, 1971 Mota, through her lawyer, notified the tenants
precluded from an action against Anglo Sr. for its loss. On the occupying "M. Torres Building" that she is the new owner thereof and
other hand, Anglo Sr. is barred from recovering the land because henceforth, payment of their rentals should be made to her.
it is the Bureau that holds a valid certificate of title, so he meets  On December 17, 1971 Torres filed a complaint, which later gave rise
the 3rd requirement. Because of non-compliance, he still cannot to this petition, with the Court of First Instance of Manila, docketed
avail of damages. as Civil Case No. 85753, against Fernandez and his spouse and the
Cues to restrain the latter from collecting rentals and for the
PROCEDURAL REQUIREMENT WAS MET; PROOF WAS SHOWN declaration as void TCT No. 105953.
THAT DE OCAMPO WAS DEAD AND HAD NO PROPERTIES LEFT  The Cues in turn filed a cross-claim against Fernandez spouses
 With regard to the procedural requirement under PD 1529, Anglo and a third party complaint against the National Treasurer as
Sr. and the Corporation were able to substantially comply with the custodian of the Assurance Fund.
the need to implead the person causing fraud.  During the proceeding, Mariano Torres, having died sometime in
 They presented evidence that de Ocampo was dead and that he 1974, was substituted by his widow. On June 3, 1977, the trial court
had no properties left. Republic did not present countervailing rendered its decision declaring TCT No. 105953 in the name of
evidence to show that de Ocampo or his estate was still a viable Rosario Mota null and void as it upheld the validity of TCT No. 53628
party. in the name of Torres as the true evidence of title to the disputed
 The Assurance Fund is only liable as a last resort. The person realties, and at the same time dismissing the Cue's third party
causing the fraud is liable first. If judgment cannot be executed, complaint and cross claim.
the Assurance Fund is insurance for the innocent purchaser who
relied on the validity of property’s CT. Issues:
 Who has the better right over the property in question?
VARGAS: I think what Atty. Gimarino is trying to emphasize with  WON Spouses Cue’s third party complaint against the
this case is the fact that the principles of the caveat emptor Treasurer of the Philippines as custodian of the Assurance
principle and the reliance on the face of the title is balanced by the Fund will prosper.
existence of an assurance fund. Because the Torrens system is not
infallible, the assurance fund serves as an insurance to make sure Ruling:
that such will soften the blow of the harshness of an indefeasibility
of title, subject to conditions set by the law. TORRES HAS THE BETTER RIGHT OVER THE PROPERTY
 There is nothing on the records which shows that Torres
performed any act or omission which could have jeopardized
Torres vs. Court of Apeals his peaceful dominion over his realties.
 The decision under review, however, in considering Mota an
Facts: innocent mortgagee protected under Section 65 of the Land
 The parcel of land located at the corner of Quezon Boulevard and Registration Law, held that Torres was bound by the
Raon Street (now Gonzalo Street), and the building erected thereon mortgage. Inevitably, it pronounced that the foreclosure sale, where
known as "M. Torres Building" is owned by Mariano Torres, the herein Mota was the highest bidder, also bound Torres and concluded that
petitioner, as evidenced by Transfer Certificate of Title No. 53628- the certificate of title issued in the name of Mota prevails over that of
Manila issued in his name. Torres'. (CFI was wrong)
 Sometime in 1966, Francisco Fernandez, Torres' brother-in-law,  As correctly pointed out by Torres, however, his properties
filed a petition with the Court of First Instance of Manila, docketed as were sold on execution, and not on foreclosure sale, and
LRC GLRO Cad. Rec. No. 133, where he, misrepresenting to be the hence, the purchaser thereof was bound by his notice of
attorney-in-fact of Torres and falsely alleging that the owners' adverse claim and lis pendens annotated at the back of
duplicate copy of TCT No. 53628 was lost, succeeded in obtaining Fernandez' TCT.
a court order for the issuance of another copy of the  Moreover, even if We grant Mota the status of an innocent mortgagee,
certificate. the doctrine relied upon by the appellate court that a forged
 Once in possession thereof, Fernandez forged a simulated deed instrument may become the root of a valid title, cannot be
of sale of the realties in his favor. Whereupon TCT No. 53628 in applied where the owner still holds a valid and existing
the name of Torres was cancelled and TCT No. 86018 was issued in certificate of title covering the same interest in a realty.
Fernandez' name. On various dates from December, 1966 to  The doctrine would apply rather when the forger thru insidious
November, 1967 Fernandez mortgaged the realties to Rosario Mota, means obtains the owner's duplicate certificate of title,
wife of Ernesto Cue, and also to Angela Fermin, who later assigned converts it in his name, and subsequently sells or otherwise
her credit to the spouses Cue. The mortgages were annotated at the encumbers it to an innocent holder for value, for in such a case
back of TCT No. 86018 and so was the deed of assignment. the new certificate is binding upon the owner (Sec. 55, Act 496;
 Torres, who up to this time still had possession of his owner's Sec. 53, P.D. No. 1529). But if the owner holds a valid and existing
duplicate certificate of title and who was still collecting rentals from certificate of title, his would be indefeasible as against the whole
the occupants of the subject building, upon learning of the fraud world, and not that of the innocent holder's. "Prior tempore potior
committed by Fernandez, caused, on March 18, 1968, the jure."
annotation on the latter's TCT a notice of adverse claim.  We have applied this doctrine in the case of the Register of Deeds
 On March 30, 1968, Torres filed Civil Case No. 72494 against v. P.N.B. where We noted that said ruling is "a mere affirmation of
Fernandez to annul TCT No. 86018 as well as the proceedings in LRC the recognized principle that a certificate is not conclusive evidence
GLRO Cad. Rec. No. 133. On April 2, 1968, a notice of lis pendens of title if it is shown that the same land had already been registered
was annotated at the back of Fernandez' TCT. and an earlier certificate for the same land is in existence." Again in
 In the meantime, Fernandez failed to pay his various loans which the case of Baltazar v. Court of Appeals, G.R. No. 78728, We held
prompted the Cues to institute an extra judicial foreclosure of the that as between two persons both of whom are in good faith and both
mortgage. innocent of any negligence, the law must protect and prefer the lawful
 On February 11, 1969, Fernandez filed Civil Case No. 75643 against holder of registered title over the transfer of a vendor bereft of any
the spouses Cue for the annulment of the mortgage with preliminary transmissible rights.
injunction.
 After the foreclosure was enjoined, the parties entered into an Spouses Cue’s third party complaint against the Treasurer of the
amicable settlement, approved by the court whereby it was stipulated Philippines as custodian of the Assurance Fund will not prosper.
that Fernandez acknowledged and promised to pay his debt to the
Cues for Five Hundred Sixty-Two Thousand Nine Hundred Fifty-Five
Prepared by: Gas

 The trial court also dismissed the Cues' third party complaint against
the Treasurer of the Philippines as custodian of the Assurance Fund To Whom Granted Requirements
after finding them negligent in protecting their interest. Home- Any Filipino citizen - does not own more than 24
 The trial court recognized the principle that a person dealing with stead over hectares of
registered lands need not go beyond the certificate of title but Patent 18 years or head of a land in the Phils. or has not had
nevertheless pointed out that there are circumstances in this case family the
which should have put the Cues on guard and prompted them benefit of any gratuitous allotment
to investigate the property being mortgaged to them, thus: of
"The property in question is a very valuable property, in fact more than 24 hectares
accepted by defendants Mota and Medina Cue as collateral for - must have resided continuously
more than half a million pesos in loans granted by them to for at
Fernandez. Its value lies principally in its income potential, in least 1 year in the municipality
the form of substantial monthly rentals. Certainly, the registered where
title does not yield any information as to the amount of rentals the land is situated
due from the building, much less on who is collecting them, or - must have cultivated at least 1/5
who is recognized by the tenants as their landlord. Any of the
prospective buyer or mortgagee of such a property, if prudent land applied for
and in good faith, is normally expected to inquire into all these Free Any natural born - does not own more than 12
and related facts and circumstances. Patent Filipino hectares of
"Besides, by the course of visible dimensions of the M. Torres land
Building, it should be readily obvious to any one that the area of - has continuously occupied and
the two lots . . . covered by TCT No. 86018 cannot accommodate cultivated, either by himself or his
the building, as in fact it also rests upon a lot covered by TCT predecessor-in- interest tract/s of
No. 56387, and partly upon a lot leased by (Torres) from the agricultural public land subject to
City of Manila. Had (the Cues) known of this fact would they disposition
have accepted the mortgage alone over TCT No. 86018? The Sales Filipinos of lawful age - to have at least 1/5 of the land
answer is obvious. And yet, to all indications, they never Patent or broken
bothered to look into this fact about the M. Torres Building. those not of legal and cultivated within 5 years from
"xxx xxx xxx age the
Another thing that defendants Mota and Medina Cue must have but who is a head of date of the award
investigated, as any prudent buyer or mortgagee should before the - shall have established actual
consummating any transaction on real property, is the matter of family may purchase occupancy , cultivation and
payment of taxes on the property. After all, the big value of the public agricultural improvement of at least 1/5 of the
property in question necessarily means that even real estate land land until the date of such final
taxes on it alone would involve big amounts of money, and if of not more than 12 payment
there are tax arrearages, any buyer or subsequent owner of the hectares
property will have to come face to face with the tax lien attaching Special Non-Christian - DILG Secretary shall certify that
to the property wherever its owner may be. . . ." Patent Filipinos the
 We likewise take note of the manifestation of the Office of the Solicitor under Sec. 84 of the majority of the non-Christian
General that the Cues failed to contest the ruling of the trial Public Land Act inhabitants of any given
court negating the liability of the Assurance Fund. reservation
 For these reasons, We hold that the Cues' remedy merely is to go have advanced sufficiently in
against Francisco Fernandez or rather his estate since record civilization
shows that he died sometime in 1983.
Yap vs Republic
REGISTRATION OF PATENTS Principles:

CHAPTER8 (SEC. 103) 1. A Torrens title emanating from a free patent which was
secured through fraud does not become indefeasible because
the patent from whence the title sprung is itself void and of
no effect whatsoever.
Certificates of Titles Pursuant to Patents (Sec. 103)
2. A free patent that was fraudulently acquired, and the
certificate of title issued pursuant to the same, may only be
Section 103. Certificates of title pursuant to patents. Whenever
assailed by the government in an action for reversion,
public land is by the Government alienated, granted or conveyed to any
pursuant to Section 101 of the Public Land Act.
person, the same shall be brought forthwith under the operation of this
 Consuelo V d a. dela Cruz applied for free patent over a parcel of land
Decree. It shall be the duty of the official issuing the instrument of
constituting about 1,292 square meters, designated as Lot No. 9087,
alienation, grant, patent or conveyance in behalf of the Government to
Cad. 102, located in Daliao, Toril, Davao City. As she could not wait
cause such instrument to be filed with the Register of Deeds of the province
for the approval of her application, she executed a Deed of
or city where the land lies, and to be there registered like other deeds and
Waiver/Quitclaim on November 25, 1981 in favor of Rollie Pagarigan.
conveyance, whereupon a certificate of title shall be entered as in other
 Pagarigan led his own Free Patent Application (FPA) and
cases of registered land, and an owner's duplicate issued to the grantee.
subsequently, Free Patent No. (XI-I) 5133 was issued to him over
The deed, grant, patent or instrument of conveyance from the Government
said lot. Original Certificate of Title (OCT) No. P-11182 was thereby
to the grantee shall not take effect as a conveyance or bind the land but
issued in his name on November 25, 1982.
shall operate only as a contract between the Government and the grantee
 On September 5, 1989, Pagarigan mortgaged the lot to Banco Davao-
and as evidence of authority to the Register of Deeds to make registration.
Davao City Development Bank (the Bank). For failure to pay his loan,
It is the act of registration that shall be the operative act to affect and
the property was foreclosed, and was eventually sold to the Bank at
convey the land, and in all cases under this Decree, registration shall be
public auction on October 26, 1990. These proceedings were duly
made in the office of the Register of Deeds of the province or city where
annotated in the title.
the land lies. The fees for registration shall be paid by the grantee. After
 However, the land covered by OCT No. P-11182 was allegedly
due registration and issuance of the certificate of title, such land shall be
occupied by Teodoro Valparaiso and Pedro Malalis (protestants). On
deemed to be registered land to all intents and purposes under this Decree.
October 24, 1990, the they led a formal protest with the Bureau of
Lands (Bureau). They prayed for the recall of the free patent issued
SCOPE OF SECTION 103
to Pagarigan, and for the institution of a corresponding action for
• The instruments mentioned in this section whereby public lands are
reversion considering that they have been in adverse, exclusive, and
alienated, granted or conveyed are instruments transferring ownership and
continuous occupation of the subject property since 1945, cultivating
not just mere documents of lease or transferring mere possession
it, and planting various crops, nip a palms and coconut trees on said
• Provision directs the issuance to the grantee of an owner’s duplicate
land.
certificate
 On January 27, 1992, the protestants caused the annotation
• After due registration and issuance of the certificate of title, the land shall
of a notice of lis pendens in OCT No. P-11182. Assigned as
be deemed registered land for all intents and purposes under the Property
Entry No. 647677, said notice of lis pendend pertained to Civil Case
Registration Decree
No. 20-435-9 instituted by the protestants against Pagarigan,
• Public land patents when duly registered are veritable Torrens title
Menardo Metran and Rene Galope to enjoin them from demolishing
subject to no encumbrances except those stated therein, and those
the former's houses pending the determination of the Department of
specified by the statute.
Environment and Natural Resources (DENR) on the propriety of
• They become private property which can no longer be the subject of
cancelling the title obtained by Pagarigan.
subsequent disposition by the Director of Lands
• Where disposable public land is granted by the government by virtue of
Secretary of DENR decision of the administrative case filed by
a public land patent, the patent is recorded and the corresponding
protestants against Pagarigan on the issuance of a free patent
certificate of title is issued to the grantee, thereafter, the land is
title:
automatically brought within the operation of PD1529, entitled to all the
 From the Investigation Reports submitted by both the Department's
safeguards of a veritable Torrens title. Upon the expiration of 1 year from
Regional Office involved and this Office as well as from the other
its issuance, the certificate of title shall become irrevocable and
pieces of evidence available, both documentary and testimonial, it is
indefeasible like a certificate issued in a registration proceeding
obvious that actual fraud and bad faith have been committed by
• A certificate of title issued pursuant to a patent has the force and effect
[Pagarigan] in his subject public land application which led to the
of a torrens title issued through judicial registration proceedings
issuance of the title.
• But a land registration court which has validly acquired jurisdiction over
 The following facts and circumstances are uncontroverted, to wit:
a parcel of land for registration of title cannot be divested of said
 that the [protestants] have been in actual occupation of the land
jurisdiction by a subsequent administrative act consisting in the issuance
in dispute since 1945 and have introduced improvements
by the Director of Lands of a homestead patent covering the same parcel
thereon;
of land.
Prepared by: Gas

 that [Pagarigan] never occupied the same nor his predecessor- 4. How to assail a fraudulently acquired free patent (in relation
in-interest, Consuelo dela Cruz, that [Pagarigan] to our topic on free patents).
misrepresented in his application that he was the actual
occupant and that there were no others who occupied the lot in Ruling
dispute; The CA decision does not runs counter to the rule on
 that the title was issued sans an actual ground survey; and conclusiveness of judgement
 that [Pagarigan] did not post a copy of his Notice for [FPA] on  In a catena of cases, the Court discussed the doctrine of
both the Bulletin Boards of Daliao and Lizardo as required by conclusiveness of judgment, as a concept of res judicata as follows:
law. The second concept — conclusiveness of judgment — states that a
fact a fact or question or question which was in issue in a former suit
Continuation of Facts (Yap’s inclusion in the case): and was there which was in issue in a former suit and was there
 Meanwhile, on November 5, 1992, without consolidating title over the judicially passed upon and determined by a court of competent
land in its name, the Bank sold the subject property to herein judicially passed upon and determined by a court of competent
petitioner Beverly Anne C. Yap (Yap) and Rosanna F. Villamor jurisdiction, is conclusively settled by the judgment therein as far as
(Villamor). jurisdiction, is conclusively settled by the judgment therein as far as
 Upon the execution of the deed of sale, OCT No. P11182 was delivered the parties to that action and persons in privity with them are the
to them and Transfer Certificate of Title No. 366983 16 16 was parties to that action and persons in privity with them are concerned
eventually issued in the name of Yap and Villamor on December 16, and cannot be again litigated in any future action between concerned
2003. On February 28, 1997, the Department of Transportation and and cannot be again litigated in any future action between such
Communication led a complaint for expropriation of a portion of the parties or their privies, in the same court or any other court of such
subject lot before the RTC of Davao City, Branch 13, docketed as Civil parties or their privies, in the same court or any other court of
Case No. 25,084-97. concurrent jurisdiction on either the same or different cause of action,
concurrent jurisdiction on either the same or different cause of action,
Confronted with the issue of who among the claimants shall be while the judgment remains unreversed by proper authority.
entitled to just compensation, on February 19, 2003, the RTC  While the judgment remains unreversed by proper authority.
Branch 13 rendered its Decision. (Take note, this is the ruling for It has been held that in order that a judgment in one action
just compensation, not the cancellation of free patent title) can be conclusive as to a particular matter in another action
 WHEREFORE, it is the judgment of this court that[:] between the same parties or their privies, it is essential that
1. The plaintiff is entitled to expropriate the land subject of this the issue be identical.
case for the purpose of road right of way to the Davao Fish Port,  If a particular point or question is in issue in the second action, and
which is for public use; the judgment will depend on the determination of that particular point
2. The just compensation for the land is P278,[000].00; or question, a former judgment between the same parties or their
3. [Villamor and Yap] are the ones entitled to the payment of just privies will be final and conclusive in the second if that same point
compensation for the property subject of this case, and plaintiff or question was in issue and adjudicated in the first suit x x x.
is directed to pay the said amount to the said defendants;  Identity of cause of action is not required but merely identity
4. The Commissioner's Fee of P3,850.00 shall be paid by plaintiff of issue. In Nabus v. CA , the Court stressed that when a party
to Asian Appraisal Company, Inc., and may be deducted from seeks relief upon a cause of action different from the one asserted by
the just compensation for the land being expropriated. This case him in a previous one, the judgment in the judgment in the former
is now considered closed. SO ORDERED. suit is conclusive only as to such points or questions as were the
former suit is conclusive only as to such points or questions as were
RTC Branch 16 Decision on the Cancellation of Free Patent: actually in issue or adjudicated therein actually in issue or adjudicated
 On May 22, 2003, the respondent, through the Office of the Solicitor therein.
General (OSG), led the Complaint for Cancellation of Patent,  However, in Calalang v. Register of Deeds Quezon City, the Court
Nullication of Title and Reversion with the RTC of Davao City. clarified that the bar on re-litigation of a matter or question
 The case was raffled to Branch 16 thereof. On October 24, 2008, the extends to those questions necessarily implied in the final
RTC Branch 16 rendered a Decision dismissing the respondent's judgment, although no specific finding may have been made
complaint. The court ruled that since the subject land has already in reference thereto, and although those matters were directly
been sold to third persons, it must be shown that the latter were part referred to in the pleadings and were not actually or formally
of the fraud and/or misrepresentation committed by the original presented. "If the record of the former trial shows that the
grantee, or at least were aware of it. judgment could "If the record of the former trial shows that the
 However, since the RTC Branch 13 already declared in its judgment could not have been rendered without deciding a particular
decision in Civil Case No. 25,084-97 that Yap and Villamor matter, it will be not have been rendered without deciding a particular
were purchasers in good faith and for value of the land in matter, it will be considered as having settled that matter as to all
question, RTC Branch 16 maintained that, as a court of co- future actions between the considered as having settled that matter
equal jurisdiction, it is bound by the said finding under the as to all future actions between the parties." parties."
principle of conclusiveness of judgment.  Verily, as developed, these principles now embody paragraph (c) of
 Moreover, the fact that it took the respondent 26 years, from the Section 47, Rule 39 of the Rules of Court, which reads: (c) In any
issuance of the free patent before it instituted an action for reversion, other litigation between the same parties or their successors in
militates against its cause. interest, that only is deemed to have been adjudged in a former
judgment or final order which appears upon its face to have been so
CA Decision on the Cancellation of Free Patent: adjudged, or which was actually and necessarily included therein or
 The respondent elevated its case to the CA. necessary thereto.
 On June 30, 2011, the CA rendered the assailed Decision reversing  The question of whether or not Yap and Villamor are innocent
that of the trial court. In so ruling, the CA adopted the findings of purchasers was not an actual issue of fact in the case before
the DENR as to the commission of fraud by Pagarigan in his the RTC Branch 13, and which called for said court's
FPA, and held that neither the Bank nor Yap and Villamor were adjudication. "An issue of fact is a point supported by one party's
innocent purchasers for value. evidence and controverted by another's."
 Further, the CA maintained that the decision of the RTC Branch 13  That Yap and Villamor were buyers in good faith is merely an
did not constitute res judicata insofar as the same has not yet allegation which was not proven in court. The RTC Branch 13
attained finality. did not actually make any clear pronouncement on the matter.
 The expropriation proceeding was led on February 28, 1997.
Yap’s Arguments: The protestants caused the annotation of a notice of lis
 Yap asserts that she and Villamor purchased the subject property in pendens on the original copy of OCT No. P11182 on January
good faith and for value. She maintains that on its face, nothing 27, 1992.
appears in OCT No. P-11182 indicating that some other person has a  Accordingly, if indeed the question on whether Yap and Villamor are
right to, or interest over the property covered thereby. buyers in good faith was an actual issue of fact before the
 As such, there was no obligation on their part to look beyond the expropriation proceeding, the protestants could have easily
certificate of title to determine the legal condition of the concerned controverted such claim by the mere expedience of presenting a
property. certified original copy of OCT No. P-11182.
 Granting that a notice of lis pendens was annotated in OCT No.  Forsooth, the notice at the back of a Torrens title serves as notice to
P-11182 led before the Register of Deeds of Davao City, the the whole world of the pending controversy over the land so
same, however, was not offered in evidence and should not registered. The RTC Branch 13 basically anchored its judgment on the
have been considered. indefeasibility of a Torrens title.
 Accordingly, the presumption that Yap and Villamor were purchasers  Pursuant to the well-settled rule that a certificate of title cannot be
in good faith and for value was not effectively rebutted. subject to collateral attack and can only be altered, modified, or
 Moreover, in the case for expropriation heard before the RTC Branch cancelled in a direct proceeding in accordance with law, it was clear
13, they were already adjudged as innocent purchasers for value. that the trial court was without jurisdiction in an expropriation
Under the principle of res judicata it was but proper for RTC Branch proceeding, to rule whether the title issued to Pagarigan is void —
16 to uphold said pronouncement. notwithstanding the decision of the DENR Secretary.
 Accordingly, it was an error on the part of the CA to reverse the same.  Thereupon, since the position of the protestants rests mainly on the
Invoking the Court's ruling in Saad Agro-Industries, Yap asserts validity of Pagarigan's title which cannot be considered in the action,
that the respondent failed to discharge the burden of proving the RTC Branch 13, in effect, posited that there was no legal way for it to
alleged fraud and misrepresentation which attended Pagarigan's FPA. rule otherwise.
 Accordingly, and as similarly advanced by the OSG in its
Issues: Comment, the RTC Branch 13's pronouncement that Yap and
1. Whether or not the CA decision runs counter to the rule on Villamor were buyers in good faith was, at best, a mere obiter
conclusiveness of judgement? dictum. Contrary to Yap's claim, there was nothing final or conclusive
2. Whether or not Yap and Villamor are innocent purchasers for with the decision of the RTC Branch 13 which the CA should be bound.
value?
3. Are respondents barred by estoppel or laches?
Yap and Villamor are NOT innocent purchasers for value.
Prepared by: Gas

 "[F]actual findings of administrative or quasi-judicial bodies, which  While the action for reversion was instituted only in 2003, the
are deemed to have acquired expertise in matters within their circumstances leading to the institution of the case hardly spells
respective jurisdictions, are generally accorded not only respect but inaction or neglect on the part of the respondent as to be considered
even finality, and bind the Court when supported by substantial guilty of laches.
evidence."  Forsooth, there was no prolonged inaction on the part of the
 The fact that Pagarigan fraudulently secured his free patent respondent in this case. This can be gleaned in the decision of
was duly established by the investigation conducted by the the DENR Secretary.
DENR through Senior Special Investigator Domingo Mendez. The  Shortly after the protestants led a formal protest with the Bureau on
decision of the DENR is very clear in this regard, thus: The following October 24, 1990, the Officer-in-Charge, Regional Executive Director
facts The following facts and circumstances are uncontroverted and (RED) of the DENR Region XI, Davao City immediately ordered an
circumstances are uncontroverted, to wit; that the [protestants] have investigation on November 15, 1990, and the same commenced on
been in actual occupation of the land in dispute since 1945 and have November 19, 1990.
introduced improvements thereon; that [Pagarigan] never occupied  On February 14, 1994, the RED issued a decision dismissing the
the same nor his predecessor-in-interest, Consuelo dela Cruz; that protestants' protest. Undaunted, the protestants elevated their case
[Pagarigan] misrepresented in his application that he was the actual to the Office of the DENR Secretary.
occupant and that there were no others who occupied the lot in  On May 15, 1995, the DENR Secretary set-aside the RED's decision
dispute; that the title was issued sans an actual ground survey; and and ordered the institution of appropriate action for the cancellation
that [Pagarigan] did not post a copy of his Notice for [FPA] on both of OCT No. P-11182, and for the reversion of the property covered
the Bulletin Boards of Daliao and Lizardo as required by law. thereby to the government.
 However, as adverted to above, Section 32 of Presidential Decree
No. 1529 mandates that for a reversion case to prosper, it is Discussion (Atty. Gimarino):
not enough to prove that the original grantee of a patent has How to assail a fraudulently acquired free patent (in relation to
obtained the same through fraud; it must also be proven that our topic on free patents).
the subject property has not yet been acquired by an innocent A free patent that was fraudulently acquired, and the certificate of title
purchaser for value, because fraudulent acquisition cannot affect issued pursuant to the same, may only be assailed by the government in
the titles of the latter. an action for reversion, pursuant to Section 101 of the Public Land Act. In
 Henceforth, the ultimate resolution of this case boils down to the Sherwill Development Corporatio n v. Sitio Sto . Niño Residents
determination on whether the subsequent conveyances of the subject Association, Inc . , he Court pointed out that: It is also to the public
lot from Pagarigan were made to innocent purchasers for value. interest that one who succeeds in fraudulently acquiring title to a public
Specically, based on the records, can we regard the Bank, and land should not be allowed to benefit therefrom, and the State should,
thereafter, Yap and Villamor as innocent purchasers for value? therefore, have an even existing authority, thru its duly-authorized
 Verily, the Court is in full accord with the following disquisitions of the officers, to inquire into the circumstances surrounding the issuance of any
CA on the matter, thus: It cannot be overemphasized that [the such title, to the end that the Republic, thru the Solicitor General or any
Bank], being in the business of extending loans secured by other officer who may be authorized by law, may le the corresponding
real estate mortgage, is familiar with rules on land action for the reversion of the land involved to the public domain, subject
registration. As such, it was, as here, expected to exercise thereafter to disposal to other qualified persons in accordance with law. In
more care and prudence than private individuals in its other words, the indefeasibility of a title over land previously public is not
dealings with registered lands. a bar to an investigation by the Director of Lands as to how such title has
 Accordingly, given inter alia the suspicion-provoking presence of been acquired, if the purpose of such investigation is to determine whether
occupants other than the owner on the land to be mortgaged, it or not fraud had been committed in securing such title in order that the
behooved them to conduct a more exhaustive investigation on the appropriate action for reversion may be filed by the Government.
history of the mortgagor's title.
 That appellee Bank accepted in mortgage the property in
question notwithstanding the existence of structures on the Alonzo v. Cebu Country Club
property and which were in actual, visible, and public possession of
persons other than the mortgagor, constitutes gross negligence Facts:
amounting to bad faith.  Petitioner Francisco M. Alonso (Francisco) was the only son and
 As pointed out by the CA, the respondent argued that at the time sole heir of the late spouses Tomas N. Alonso and Asuncion
Yap and Villamor purchased the said lot from the Bank, a Medalle. Francisco died during the pendency of this case, and
notice of lis pendens was already annotated on OCT No. P- was substituted by his legal heirs, namely: his surviving spouse,
11182; hence, they cannot be considered as innocent purchasers for Mercedes V. Alonso, his son Tomas V. Alonso (Tomas) and his
value. daughter Asuncion V. Alonso.
 Time and again, the Court has ruled that the burden of proof to  In 1992, Francisco discovered documents showing that his
establish the status of a purchaser and registrant in good faith lies father Tomas N. Alonso had acquired Lot No. 727 of the Banilad
upon the one who asserts it. Friar Lands Estate from the Government in or about the year 1911;
 This onus probandi cannot be discharged by mere invocation of the that the original vendee of Lot No. 727 had assigned his sales
legal presumption of good faith. It must be emphasized that aside certificate to Tomas N. Alonso, who had been consequently
from the fact that a notice of lis pendens was already annotated on issued Patent No. 14353. The sales patent, however, and even
OCT No. P-11182 even before Yap and Villamor purchased the subject the corresponding deed of sale were not registered with the
property, it was also established that when they did so, the said Register of Deeds and no title was ever issued in the name of
property was still registered in the name of Pagarigan since the latter. This is because there were basic requirements not
the Bank did not consolidate its title thereto. complied with, the most important of which was that the deed of
 Stated simply, Yap and Villamor purchased the subject property sale executed by the Director of Lands was not approved by
not from the registered owner. [T]he law protects to a greater the Secretary of Agriculture and Natural Resources.
degree a purchaser who buys from the registered owner himself.  Francisco subsequently found that the certificate of title covering Lot
Corollarily, it requires a higher degree of prudence from one No. 727-D-2 of the Banilad Friar Lands Estate had been
who buys from a person who is not the registered prudence "administratively reconstituted from the owner's duplicate" of
from one who buys from a person who is not the registered Transfer Certificate of Title (TCT) No. RT-1310 in the name of United
owner, although the land object of the transaction is Service Country Club, Inc., the predecessor of respondent Cebu
registered. Country Club, Inc. (Cebu Country Club).
 While one who buys from the registered owner does not need to look  On September 25, 1992, Francisco commenced against Cebu
behind the certificate of title, one who buys from one who is not the Country Club in the RTC in Cebu City an action for the declaration
registered one who buys from one who is not the registered of nullity and non-existence of deed/title, the cancellation of
owner is expected to examine not only the certificate of title certificates of title, and the recovery of property.
but all owner is expected to examine not only the certificate
of title but all factual circumstances necessary for him to SUPREME COURT RULING IN CASE 130876
determine if there are any factual circumstances necessary for him to  On January 31, 2002, this Court decided G.R. No. 130876,
determine if there are any flaws in the title of the transferor, or in his declaring that Lot No. 727 D-2 of the Banilad Friar Lands
capacity to transfer the flaws in the title of the transferor, or in his Estate legally belongs to the Government of the Philippines. The
capacity to transfer the land. This Court has consistently applied the Court found that the petitioners did not validly acquire ownership of
stricter rule stricter rule when it comes to deciding the issue of good Lot No. 727-D-2.
faith of one who buys from one who is not the registered owner, but
who exhibits a certificate of title. Enactment of RA 9443, which declares the gov’t the owner
of the Banilad Friar Lands
Respondents are not barred by estoppel or laches
 No. In Saad Agro-Industries, free patent was alleged to have been  In late 2004, the Government, through the OSG, filed a motion for
mistakenly issued over a property that was claimed by therein the issuance of a writ of execution. However, The Congress
respondent as inalienable for being part of a track of land classified ultimately enacted a law (RA 9443) to validate the TCTs and
as forest land. However, it was established that government has not reconstituted titles covering the Banilad Friar Lands Estate in Cebu
yet classified the lot in question as forest reserve prior to the issuance City.
of the concerned free patent. Moreover, it was also established that  On December 28, 2007, therefore, the RTC denied the OSG's
therein subject property was already conveyed to an innocent motion for the issuance of a writ of execution through the first
purchaser for value, Saad Agro-Industries, Inc. before the action for appealed order. The petitioners filed a motion for reconsideration
reversion was instituted. questioning the denial of the OSG's motion for the issuance of a writ
 In the instant case, it was established that Pagarigan's FPA was of execution.
secured on the basis of his fraudulent representations. The
respondent cannot be faulted for having been misled into Government’s Desistance from the Decision of Case 130876
believing that an applicant is legally qualified to be granted free
patent as to render it estopped from asserting its right to recover its  The OSG manifested in writing that the Government was no
own property. longer seeking the execution of the decision in G.R. No.
130876, subject to its reservation to contest any other titles within
Prepared by: Gas

the Banilad Friar Lands Estate, should clear evidence show such  They cannot therefore obtain affirmative relief. It also declares
titles as having been obtained through fraud. the respondents as innocent purchasers for value who the
 (RTC RULING) After the filing of the OSG's comment, the RTC obtained the duplicate of the OCT still in the name of the Egaos from
issued the second appealed order, denying the petitioners' motion Marfori and ownership was transferred to them by physical
for reconsideration, giving the following reasons: possession of the property.
 It thus promulgated judgment holding the respondents the
1. The party who had a direct interest in the execution of the decision absolute owners of the land in dispute, to cancel the OCT of the
and the reconsideration of the denial of the motion for execution was the petitioner and its transfer thereof to the respondents and to
OSG; hence, the petitioners had no legal standing; surrender peaceful possession of the land to the respondents.
2. R.A. No. 9443 "confirms and declares as valid" all "existing" TCTs and
reconstituted titles; thereby, the State in effect waived and divested Issue: Whether or not the petitioners validly transferred their
itself of whatever title or ownership over the Banilad Friar Lands ownership to Marfori to resolve the rights of the respondents over
Estate; the land in dispute.
3. The situation of the parties had materially changed, rendering the Ruling:
enforcement of the final and executory judgment unjust, inequitable, and SALE FROM EGAO TO MARFORI IS NULL AND VOID;
impossible, because Cebu Country Club was now recognized by the State PURCHASER IS IN BAD FAITH FOR BUYING LOT WITHIN
itself as the absolute owner of Lot 727 D-2. THE 5-YEAR RESTRICTION PERIOD
Issue: Whether or not petitioners Francisco or Tomas are owners
of Lot No. 727.  No. Egao sold the patent within the 5-year prohibition
Whether or not petitioners have legal standing. therefore the sale between Egao to Marfori is null and void.
Ruling: Also, respondent is a purchaser in bad faith since he knew that
PETITIONERS ARE NOT THE OWNERS FOR NON-COMPLIANCE the title was not yet in the name of Marfori.
WITH REQUIREMENTS – APPROVAL OF THE DEED OF SALE BY THE  The SC holds that based on the adduced evidence, the Egaos sold
SECRETARY OF AGRICULTURE AND NATURAL RESOURCES the lot to Marfori within the 5-year restriction period provided by law
 The most that petitioners could claim was that the Director of on Free Patent based on the Deed of Sale entered into by the parties.
Lands issued a sales patent in the name of Tomas N. Alonso. The Although the petitioners denied the validity of the Deed of
sales patent, however, and even the corresponding deed of sale Sale the court held that it was notarized and a notarial
were not registered with the Register of Deeds and no title document has in its favor the presumption of regularity.
was ever issued in the name of the latter.  When the land was sold to the respondents, they knew that the
 This is because there were basic requirements not complied with, OCT is still registered under the name of the petitioners. Thus,
the most important of which was that the deed of sale executed by they are not considered to be innocent purchaser as contrary to the
the Director of Lands was not approved by the Secretary of ruling of the CA.
Agriculture and Natural Resources. Hence, the deed of sale was void.  Where a purchaser neglects to make the necessary inquiries and
"Approval by the Secretary of Agriculture and Commerce is closes his eyes to facts which should put a reasonable man on his
indispensable for the validity of the sale." guard as to the possibility of the existence of a defect in his vendor's
 (Jesus P. Liao v. CA) Court has ruled categorically that approval by title, and relying on the belief that there was no defect in the title of
the Secretary of Agriculture and Commerce of the sale of friar lands the vendor, purchases the property without making any further
is indispensable for its validity, hence, the absence of such investigation, he cannot claim that he is a purchaser in good faith
approval made the sale null and void ab-initio. for value.
 Necessarily, there can be no valid titles issued on the basis of  A private individual cannot bring an action for reversion or
such sale or assignment. Consequently, petitioner Francisco's any action which would have an effect of canceling a free
father did not have any registerable title to the land in question. patent and the certificate of title issued on the basis thereof since
Having none, he could not transmit anything to his sole heir, the land covered will form part again of the public domain.
petitioner Francisco Alonso or the latter's heirs.  Sec. 124 of the Public Land Act provides that deeds of sale of
 Moreover, Cebu Country Club, Inc. was in possession of the land patented lands, perfected within the prohibited five (5) year period
since 1931, and had been paying the real estate taxes are null and void thus the Egaos have no title to pass to Marfori and
thereon based on tax declarations in its name with the title number nobody can dispose that which does not belong to him.
indicated thereon. Tax receipts and declarations of ownership for  Conclusion: The respondents are not innocent purchasers for value
taxation purposes are strong evidence of ownership. with no standing to question the rights of the petitioners over the
 This Court has ruled that although tax declarations or realty tax land and to file an action to quiet the title. The petitioners
payments are not conclusive evidence of ownership, nevertheless, remained to be the registered owners and entitled to remain
they are good indicia of possession in the concept of owner in physical possession of the disputed property. Respondents
for no one in his right mind will be paying taxes for a property that are ordered to deliver the OCT to the petitioners without prejudice
is not in his actual or constructive possession. to an action for reversion of the land to be instituted by the Solicitor
General for the State.
PETITIONERS ARE NOT THE RIGHTFUL OWNERS; THERE IS NO
LEGAL STANDING CERTIFICATION OF LAND TRANSFER,
 Since Francisco and Tomas are not the rightful owners of Lot
727, they have no locus standi.
EMANCIPATION PATENT
 An appeal, like this one, is an action to be prosecuted by a party in CHAPTER 9 (SEC. 104 — 105)
interest before a higher court. In order for the appeal to prosper, the
litigant must of necessity continue to hold a real or present Certificate of Land Transfer
substantial interest that entitles him to the avails of the suit on
appeal. If he does not, the appeal, as to him, is an exercise in futility. Section 104. Provisional Register of Documents. The Department of
So, it is with the petitioners. Agrarian Reform shall prepare by automate data processing a special
 In contrast, the Government, being the legal owner of Lot No. registry book to be known as the "Provisional Register of Documents issued
727-D-2, is the only party adversely affected by the denial, and under PD-27" which shall be kept and maintained in every Registry of
is the proper party entitled to assail the denial. However, its manifest Deeds throughout the country. Said Registry Book shall be a register of:
desistance from the execution of the decision effectively barred any a. All Certificates of Land Transfer (CLT) issued pursuant to P.D. No. 27;
challenge against the denial, for its non-appeal rendered the denial and
final and immutable. b. All subsequent transactions affecting Certificates of Land Transfer
such as adjustments, transfer, duplication and cancellations of
Egao v. CA erroneous Certificates of Land Transfer.
Facts: Section 105. Certificates of Land Transfer Emancipation Patents.

 The respondents filed a motion for quieting the title and The Department of Agrarian reform shall pursuant to P.D. No. 27 issue in
recovery of possession and ownership against the duplicate, a Certificate of Land Transfer for every land brought under
petitioners. Apparently, they (respondents) claim they are the "Operation Land Transfer", the original of which shall be kept by the
owners of the parcel of land by virtue of the deed of sale they entered tenant- farmer and the duplicate, in the Registry of Deeds. After the
into with Roberto Marfori to whom the petitioners allegedly sold their tenant-farmer shall have fully complied with the requirements for a grant
land to. of title under P.D. No. 27, an Emancipation Patent which may cover
 The Egaos acquired their land title by virtue of a free patent previously titled or untitled property shall be issued by the Department of
and transferred their ownership in favor of Marfori by virtue Agrarian Reform. The Register of Deeds shall complete the entries on the
of a deed of sale. However, the Certificate of Title was not aforementioned Emancipation Patent and shall assign an original certificate
transferred in Marfori’s favor. Upon purchase of the land from of title number in case of unregistered land, and in case of registered
Marfori, the respondents introduced improvements thereon and paid property, shall issue the corresponding transfer certificate of title without
taxes for the property. requiring the surrender of the owner's duplicate of the title to be canceled.
 However, the petitioners illegally occupied portions of the In case of death of the grantee, the Department of Agrarian Reform shall
land. Petitioner answers that they are the true owner of the land by determine his heirs or successors-in-interest and shall notify the Register
virtue of the Certificate of Title issued by the Register of Deeds of Deeds accordingly.  In case of subsequent transfer of property covered
pursuant to their Free Patent. by an Emancipation Patent or a Certificate of Title emanating from an
 (RTC RULING & CA RULING) The RTC ruled in favor of Egao. Emancipation Patent, the Register of Deeds shall affect the transfer only
Upon appeal, the CA reversed the decision of the lower court on upon receipt of the supporting papers from the Department of Agrarian
grounds that the main issue should be whether Egao can validly Reform. No fee, premium, of tax of any kind shall be charged or imposed
sell the land to Marfori who subsequently transferred the in connection with the issuance of an original Emancipation Patent and for
ownership to the respondents. the registration or related documents.
 The CA holds both Egao and Marfori to be in pari delicto for
violating the 5-year restriction provided by Commonwealth 141 AGRARIAN REFORM PROVISION IN THE 1987 CONSTITUTION
against encumbrance and alienation of public lands acquired thru Article 13, Section 4. The State shall, by law, undertake an agrarian
free patent or homestead patent. reform program founded on the right of farmers and regular farmworkers
who are landless, to own directly or collectively the lands they till or, in the
Prepared by: Gas

case of other farmworkers, to receive a just share of the fruits thereof. To  In an action for redemption filed by Banaga, the trial court declared
this end, the State shall encourage and undertake the just distribution of that she had lost her right to redeem the property earlier
all agricultural lands, subject to such priorities and reasonable retention foreclosed and which was subsequently sold at public auction
limits as the Congress may prescribe, taking into account ecological, to private respondent.
developmental, or equity considerations, and subject to the payment of  Certificates of Title covering the said property were issued to
just compensation. In determining retention limits, the State shall respect private respondent over which Banaga annotated a notice of
the right of small landowners. The State shall further provide incentives lis pendens. CA reversed the decision and allowed her to
for voluntary land-sharing. redeem the property.
COMPREHENSIVE AGRARIAN REFORM OF 1998 (RA 6657) ATTEMPT TO EXECUTE THE REDEMPTION
• Agrarian reform program is founded on the right of farmers and regular
farm workers, who are landless, to own directly or collectively the lands  On June 11, 1992, Banaga tried to redeem the property by
they till, or in case of other farm workers, to receive a just share on the depositing with the trial court the amount of redemption
fruits thereof which was financed by co-petitioner Tan. Damalerio
• To this end, the State shall encourage and undertake the just distribution (respondent) opposed the redemption stating that it was made
of all agricultural lands, subject to the priorities and retention limits set beyond the time given to her by the court in the earlier case.
forth in the law, taking into account ecological, developmental, and equity  (LOWER COURT RULING) The lower court decided on August 7,
considerations and subject to the payment of just compensation 1992, that the redemption was valid and ordered the RD to
• The State shall respect the right of small landowners, and shall provide cancel respondent’s CT and issue new titles in Banaga’s name.
for voluntary land-sharing  Respondent appealed and filed a petition for certiorari with the CA
while later causing another notice of lis pendens on the CTs. CA
PETITIONS AND ACTIONS AFTER ORIGINAL REGISTRATION issued a TRO to stop execution of the decisions of the lower
CHAPTERX (SECTIONS 107 - 110) court.
 On January 7, 1993, Banaga sold the property to Tan with the deed
Surrender of Withheld Duplicate Certificate (Sec. 107) of sale which mentioned that the CT of respondent was not yet
cancelled. Despite the notice, Tan subdivided the property under
Section 107. Surrender of withhold duplicate certificates. Where it a subdivision plan made in the name of private respondent.
is necessary to issue a new certificate of title pursuant to any involuntary  When the TRO expired, Tan asked the RD to issue new titles in
instrument which divests the title of the registered owner against his her name and such was granted with the previous annotations of
consent or where a voluntary instrument cannot be registered by reason the notices of lis pendens still written into the CT.
of the refusal or failure of the holder to surrender the owner's duplicate  (CA RULING) CA later declared on October 28, 1993 the private
certificate of title, the party in interest may file a petition in court to compel respondent the absolute owner of the subject property for
surrender of the same to the Register of Deeds. The court, after hearing, failure to redeem the property within the 30-day period previously
may order the registered owner or any person withholding the duplicate granted to her by the court. The decision became final and review
certificate to surrender the same, and direct the entry of a new certificate was dismissed for lack of merit.
or memorandum upon such surrender. If the person withholding the
duplicate certificate is not amenable to the process of the court, or if not CORRECT REMEDY TO REGISTER THE LOT IN RESPONDENT’S
any reason the outstanding owner's duplicate certificate cannot be NAME
delivered, the court may order the annulment of the same as well as the  The trial court issued a writ of execution to order the RD to
issuance of a new certificate of title in lieu thereof. Such new certificate reinstate the CTs in respondent’s name. The fact that CA’s decision
and all duplicates thereof shall contain a memorandum of the annulment declared him as the absolute owner entitles him to a writ of
of the outstanding duplicate. execution to reinstate the titles in Damalerio’s name.
 However, the RD refused to comply with the writ of execution,
REMEDY WHERE DUPLICATE CERTIFICATE IS WITHHELD stating that the CT issued to Tan must first be surrendered.
• In case the person in possession of the owner’s duplicate certificate  Respondent moved to cite RD in contempt of court which was denied
refuses or fails to surrender the same to the RD so that any involuntary or because the trial court said that the remedy is by consulta to
voluntary instrument may be registered and a certificate issued, the party the Commission of Land Registration. They also denied the
in interest may file a petition in court to compel the surrender of the same motion for an issuance of a writ of possession because the
to the RD appropriate remedy is to declare the CTs of Tan void.
• The court after hearing may order the registered owner or any person  CA granted the petition upon appeal by certiorari and mandamus.
withholding the duplicate certificate and direct the entry of a new SC upheld the same in the present case. It was puzzled as to why
certificate or memorandum upon such surrender the petition of Tan and Banaga (petitioners) seek to set aside the
• If the person withholding the certificate is not amenable to the process two orders by respondent judge not named (the orders to set aside
of the court, or if for any reason the certificate cannot be delivered, the were the denial of a writ of possession (March 29, 1996) and denial
court may order the annulment of said certificate and the issuance of a of a motion for reconsideration (Jan. 4, 1993 – pero Jan. 4, 1995
new certificate of title in lieu thereof ang gibutang sa SC).
• Such new certificate and all duplicates thereof shall contain a  Petitioners argue that:
memorandum of the annulment of the outstanding duplicate (1) Tan is a buyer in good faith.
(2) Proper remedy is for private respondent to secure the titles in
PETITION TO SURRENDER TITLE MAY BE FILED AS AN INCIDENT his name by consulta to the Land Registration Commissioner, not
IN AN ACTION AFFECTING SAID TITLE contempt.
• Where the court in an action for specific performance, upheld the sale to Issue:
the plaintiff and ordered the defendant to comply with the terms and Whether or not the argument of petitioner Tan is in good faith is
conditions to the sale, it was proper for the plaintiff to ask the court to valid. – res judicata
compel the defendant to surrender the duplicate certificate of title to the Whether or not private respondent's remedy is a direct or
RD for the registration of the sale, this being a necessary incident in the independent civil action for cancellation of petitioner Tan's titles. -
main case No
• Section 107 doesn’t preclude a party to a pending case to include as Whether or not the execution of the final and executory decision
incident therein the relief stated under said section, specially if the which is to issue titles in the name of private respondent cannot
certificate of title to be surrendered is intimately connected with the be compelled by mandamus because of the "formality" that the
subject matter of the principal action registered owner first surrenders her duplicate Certificates of Title
• Where the title is subject to a mortgage, the order of the court cannot in for cancellation – No
any way prejudice the rights of the mortgagee since any lien annotated in Whether or not petitioner Tan has better right.
the certificate is incorporated or carried over to the new transfer certificate Ruling:
of title to whoever it is issued RES JUDICATA HAS ALREADY SET IN; RENDERING THE
ARGUMENT OF GOOD FAITH MOOT
AUTHORITY OF COURT TO ORDER THE SURRENDER OWNER’S  Petitioners again raise the issue of ownership which has already been
DUPLICATE CERTIFICATE ruled upon by CA and the SC where the respondent was adjudged
• In order that the court may order the registered owner to surrender his to be the rightful and absolute owner thereof. Res judicata has
owner’s duplicate, it has to determine upon the evidence presented by already set in, with the elements present:
the parties whether the registered owner had been lawfully divested of (1) former judgment must be final.
his title thereto (2) court which rendered judgment had jurisdiction over the parties
• That of course requires and involves of the determination of the and subject matter.
question of title to the registered property (3) must be a judgment on the merits.
• Section 107 doesn’t constitute a reopening of the decree entered as a (4) there must be between the first and second actions, identity of
result of proceedings in rem for the confirmation of imperfect title under parties, subject matter, and cause of action.
said act, it cannot be deemed to contravene the purpose or aim of the
Torrens system  Banaga clearly was unable to exercise her right to
redemption and as a consequence, lost her claim of ownership to
INSTANCES WHERE THE SURRENDER OF THE ODC MAY BE the lot.
DISPENSED WITH
1. The registered owner is a party of the case; THE REMEDY IS NOT FOR CANCELLATION OF TITLE BECAUSE THE
2. There’s already a final and executory decision of the court; CASE WILL BE SIMILAR TO THAT OF THE REDEMPTION SUIT
3. There’s already an order of the issuance of Certificate of Title in WHICH WAS FINAL AND EXECUTORY
favor of the prevailing parties.  The remedy is not for cancellation of Tan’s titles. The facts, evidence,
circumstances, and arguments invoked in the final decision are the
Toledo Banaga v. CA same matters that will be established in the independent suit. It
doesn’t matter if it was a redemption suit or a cancellation of title
Facts: because the test of identity of causes of action is not in form
CASE FOR REDEMPTION OF PROPERTY but whether the same evidence would support and establish
the former and present causes of action.
Prepared by: Gas

Basically, it wouldn’t matter if the present case was for a  (RTC AND CA RULING) granted the motion of INK, ordered
redemption suit or a cancellation of title because everything used petitioner to surrender the owner’s copy of the certificates in
in the redemption suit would be re-used in a cancellation of title. open court for the registration of the Absolute Deed of Sale in INK’s
In a test of identity of causes of action, what is important is name and the annotation of the mortgage executed in favor of
whether the same evidence would be used to support the previous petitioner on the new transfer certificates of title to be issued to INK.
and present causes of action. Upon the filing of a motion by Ligon, it then reconsidered its order
SURRENDER OF DUPLICATE IS IMPLIED FROM THE EXECUTORY by directing her to deliver the certificates of title to the RD of
DECISION; ARGUMENT IS BLASPHEMOUS TO THE DECISIONS Quezon City. CA affirmed RTC ruling.
RENDERED BY THE COURTS  IDP: prior to issuance by the trial court of its 1992 order, its legal
Board of Trustees filed a motion for intervention stating that the sale
 The petitioners argue that the winning party must wait execution was not executed by it but was made possible by a fake Board so the
until the losing party has complied with the formality of surrender of sale is void. Trial court denied the motion since SEC had jurisdiction
the duplicate title. Such preposterous contention borders on the over the incident. SEC declared sale as void. IDP uses this
absurd and has no place in our legal system. Precisely, the Supreme decision to also nullify orders of the trial court.
Court had already affirmed the CA's judgment that Certificates of
Title be issued in private respondent's name. TIMELINE: IDP sells land to INK -> stipulated that they drive
 (IMPORTANT!!!) If execution cannot be done just because the squatters out -> complaint for specific performance against IDP -
losing party will not surrender her titles, the entire proceedings of > IDP allegedly fails to comply accdng. to INK; INK delayed
the courts would be rendered useless. The surrender of the payment accdng. to IDP -> motion for partial summary judgment
duplicate is implied from the executory decision since the (everything granted except damages in partial judgment) ->
petitioners were themselves parties thereto. motion to surrender duplicate copy -> RTC granted -> RTC
 Besides, as part of the execution process, it is a ministerial reconsidered -> CA affirmed.
function of the Register of Deeds to comply with the decision
of the court to issue a title and register a property in the name MEANWHILE: motion for intervention by IDP -> denied for lack of
of a certain person, especially when the decision had attained jurisdiction by trial court -> SEC declared sale as void.
finality, as in this case.
 The enforcement of a final and executory judgment is likewise Issues:
a ministerial function of the courts and does not call for the Whether or not the trial court erred:
exercise of discretion. Being a ministerial duty, a writ of a. In ruling that it had jurisdiction over petitioner;
mandamus lies to compel its performance. b. In upholding the orders of the trial court even as they violated
 Moreover, it is axiomatic that where a decision on the merits is the rule prohibiting splitting of a single cause of action and
rendered and the same has become final and executory, as in forum shopping;
this case, the action on procedural matters or issues becomes c. In holding that INK is the owner of the property and entitled
moot and academic. to registration of its ownership; and
 Thus, the so-called consulta to the Commissioner of Land d. In holding that INK has a superior right to the possession of
Registration, which is not applicable herein, was only a naive and the owner’s copies of the certificates of title.
belated effort resorted to by petitioners in order to delay
execution. If petitioners desire to stop the enforcement of a final Ruling:
and executory decision, they should have secured the issuance of a
writ of preliminary injunction, but which they did not avail knowing Note: Before the enactment of PD 1529, Act No. 496 had established that
that there exist no legal or even equitable justifications to support summary reliefs such as an action to compel the surrender of owner’s
it. duplicate certificate of title could only be filed with and granted by the RTC
sitting as a land registration court if there was unanimity among the parties
TAN IS A BUYER IN BAD FAITH AND HAS NO RIGHT TO or there was no adverse claim or serious objection on the part of any party-
POSSESSION; RIGHT OF POSSESSION IS A NECESSARY INCIDENT in-interest, otherwise, if the case became contentious and controversial it
OF OWNERSHIP should be threshed out in an ordinary action or in the case where the
 Being a buyer in bad faith, petitioner Tan cannot acquire better rights incident properly belonged.
than her predecessor in interest, for she merely stepped into the
shoes of the latter. Such finding of bad faith is final and may RTC HAD JURISDICTION OVER PETITIONER; ACTION FOR
not be re-opened for the law cannot allow the parties to trifle with SPECFIC PERFORMANCE IS WITHIN ITS JURISDICTION
the courts.
 With respect to the issue of possession, such right is a  Under Sec. 2 of PD 1529, Courts of First Instance (RTC) are
necessary incident of ownership. The adjudication of ownership conferred with the authority to act on all petitions filed after original
to private respondent includes the delivery of possession since registration of title, with power to hear and determine all
the defeated parties in this case has not shown by what right questions arising upon such applications or petitions.
to retain possession of the land independently of their claim of  The principal action filed by INK was one for specific performance
ownership which was rejected. with damages based on a document of sale and was well within the
 Otherwise, it would be unjust if petitioners who has no valid exclusive jurisdiction of the RTC.
right over the property will retain the same. Thus, the CA
correctly disagreed with the trial court's order denying private WHILE THE LAW SPEAKS OF A PETITION TO COMPEL SURRENDER
respondent's motion for writ of possession. OF CERTIFICATES, IT DOES NOT PRECLUDE INCLUDING THAT AS
A RELIEF, ESPECIALLY IF THE TITLE IS INTIMATELY CONNETED
Ligon v. CA TO THE SUBJECT MATTER OF THE PRINCIPAL ACTION
Facts:  When IDP did not question the validity of the deed of sale, the
 On October 19, 1990, respondent Iglesia ni Kristo filed with the RTC summary judgment issued by the court was an exercise of its general
of Quezon City a complaint for specific performance with jurisdiction.
damages against the Islamic Directorate of the Philippines (IDP).  Hence, when INK filed a motion for the issuance of an order from the
 Respondent INK alleged that by virtue of an Absolute Deed of same court to compel the holder of the duplicate certificates of title
Sale dated April 20, 1989, IDP sold to it 2 parcels of land to surrender the same for the registration of the deed of sale subject
located at Tandang Sora, Barrio Cuilat, Quezon City, both of which of the principal action, the motion was a necessary incident to the
IDP is the registered owner. main case.
 The parties stipulated in the deed of sale that the IDP shall  Even while Sec. 107 of PD 1529 speaks of a petition which can be
undertake to evict all squatters and illegal occupants in the filed by one who wants to compel another to surrender the certificates
property within 45 days from execution, but IDP failed to fulfill its of title to the Register of Deeds, this does not preclude a party to
obligation. So, INK prayed that the trial court order IDP to comply a pending case to include as an incident therein the relief
with its obligation of clearing the subject lots of illegal occupants and stated under Sec. 107, especially if the subject certificates of
pay damages to INK. title to be surrendered are intimately connected with the
 IDP’s answer: It was INK which violated the contract; delayed subject matter of the principal action.
payment of purchase price. IDP then prayed that the contract  This principle is based on expediency and in accordance with
of sale be rescinded and revoked. the policy against multiplicity of suits.
 June 15, 1991: INK filed a motion for partial summary
judgment on the ground that there was no genuine issue as to GENERAL RULE: REQUIRES A PETITION TO COMPEL.
any material fact. The trial court rendered partial judgment on EXC: IF SUCH IS INCIDENTAL TO PRINCIPAL CASE.
September 12, 1991, and an amended partial judgment on October
7 granting the reliefs prayed for by INK except the prayer for INK IS THE OWNER OF THE PROPERTY AND ENTITLED TO
damages. REGISTRATION OF ITS OWNERSHIP; INK HAS A SUPERIOR RIGHT
 January 22, 1992: INK filed a motion (A MOTION, NOT A TO THE POSSESSION OF THE OWNER’S COPIES OF THE
PETITION) praying that petitioner (Leticia Ligon), who was in CERTIFICATES OF TITLE BECAUSE IT DOES NOT PREJUDICE
possession of the certificates of title over the properties as LIGON’S RIGHTS AS MORTGAGE
mortgagee of IDP, be directed to surrender the same to the
Register of Deeds of Quezon CIty for the registration of the  Under our land registration law, no voluntary instrument shall be
Absolute Deed of Sale in its name; they alleged that the document registered by the Register of Deeds unless the owner’s duplicate
could not be registered due to the refusal/failure of petitioner certificate is presented together with such instrument, except in
to deliver the certificates despite repeated requests. some cases or upon the order of the court for cause shown. In
 Ligon: filed an opposition alleging that IDP was not served copy of case the person in possession refuses or fails to surrender the same
the motion; ownership of INK over the property was still in to the RD so that a voluntary document may be registered and a new
issue since rescission was sought by IDP. Should the motion be certificate issued, Sec. 107 of P.D. No. 1529 states:
granted, she asked for the RD to be directed to deliver the owner’s  …Where a voluntary instrument cannot be registered by reason
duplicate copies of the new certificates of title to her. of the refusal or failure of the holder to surrender the owner’s
duplicate, the party in interest may file a petition in court to
Prepared by: Gas

compel surrender of the same to the RD. The court, after
hearing, may order the registered owner or any person NO TIME LIMIT TO FILE PETITION
withholding the duplicate certificate to surrender the same and • No limitation or period is fixed for filing a petition to annotate a deed of
direct the entry of a new certificate or memorandum upon such sale at the back of a certificate of title
surrender. If the person withholding the duplicate certificate is • If any person claims that a person registered a deed of sale can no longer
not amenable to the process of the court, of if for any reason do so, because the deed was executed more than 10 years before, such
the outstanding owner’s duplicate cannot be delivered, the court objection must be raised in an ordinary civil action
may order the annulment of the same as well as the issuance of • Where there is no question as to the existence and validity of the deed
a new certificate of title in lieu thereof. of sale, the registration of the sale and issuance of a TCT are ministerial
 Pursuant to Sec. 2 of P.D. No. 1529, the distinction between the duties of the RD
RTC’s general and the limited jurisdiction when acting merely as a
cadastral court has been eliminated. Republic v. Galeno
 Aimed at avoiding multiplicity of suits, the change has simplified
registration proceedings by conferring upon the RTCs the Facts:
authority to act not only on applications for original  On September 2, 2003, respondent Carmen Santorio Galeno
registration but also over petitions filed after original (respondent) filed a petition for correction of the area of Lot No.
registration of title, with power to hear and determine all questions 2285 covered by OCT No. 46417, Dingle Cadastre (subject property)
arising upon such applications or petitions. before the RTC.
 Even while Sec. 107 of PD 1529 speaks of a petition which can  She alleged therein that she is one of the co-owners of the
be filed by one who wants to compel another to surrender the subject property by virtue of a Deed of Sale dated July 6, 1962.
certificates of title to the RD, this does not preclude a party to The survey and subdivision of the subject property was duly
a pending case to include as incident therein the relief stated approved by the Department of Environment and Natural
under said section, especially if the subject certificates of title Resources (DENR) per its Approved Subdivision Plan of Lot No.
to be surrendered are intimately connected with the subject 2285.
matter of the principal action.  Galeno further alleged that when she and her co-owners had the
 The records of the case show that the subsisting mortgage lien of subject property resurveyed for the purpose of partition, they
petitioner appears in both certificates of title. discovered a discrepancy in the land area of the subject property
 Hence, the order of the trial court directing the surrender of as appearing in OCT No. 46417, in that the title reflects an area
the same to the RD in order that the deed of sale in favor of of 20,948 square meters, while the Certification issued by the
INK can be registered cannot in any way prejudice her rights DENR Office of the Regional Technical Director, Lands Management
and interests as a mortgage of the lots. Services, shows an area of 21,298 square meters.
 Any lien annotated on the previous certificates of title which  Hence, she sought to correct the area of the subject property
subsists should be incorporated or carried over to the new in order to avoid further confusion, and claimed to have notified
TCTs. It subsists notwithstanding a change in ownership. the adjoining owners.
Thus, all subsequent purchasers must respect the mortgage.  There being no opposition to the petition, the RTC allowed the
presentation of respondent's evidence ex parte before the Branch
Clerk as well as for the satisfaction of the jurisdictional requirements.
Amendment and Alteration of Certificates (Sec. 108)
RTC Ruling
 In an Order dated October 13, 2006, the RTC granted the petition
Section 108. Amendment and alteration of certificates. No erasure, upon a finding that respondent was able to substantiate the
alteration, or amendment shall be made upon the registration book after allegations in her petition to warrant a correction of the area
the entry of a certificate of title or of a memorandum thereon and the of the subject property.
attestation of the same be Register of Deeds, except by order of the proper  Hence, it directed the Register of Deeds of the Province of Iloilo to
Court of First Instance. A registered owner of other person having an correct such area in OCT No. 46417 from 20,948 to 21,298 square
interest in registered property, or, in proper cases, the Register of Deeds meters.
with the approval of the Commissioner of Land Registration, may apply by
petition to the court upon the ground that the registered interests of any OSG Motion
description, whether vested, contingent, expectant or inchoate appearing  Herein petitioner Republic of the Philippines (petitioner), through the
on the certificate, have terminated and ceased; or that new interest not Office of the Solicitor General (OSG), filed a motion for
appearing upon the certificate have arisen or been created; or that an reconsideration claiming that the adjoining owners had not
omission or error was made in entering a certificate or any memorandum been notified, stressing that such notice is a jurisdictional
thereon, or, on any duplicate certificate; or that the same or any person requirement.
on the certificate has been changed; or that the registered owner has
married, or, if registered as married, that the marriage has been RTC Ruling
terminated and no right or interests of heirs or creditors will thereby be
affected; or that a corporation which owned registered land and has been  In the Order dated January 22, 2007, the RTC denied the motion,
dissolved has not convened the same within three years after its finding that a Notice of Hearing was sent to the adjoining
dissolution; or upon any other reasonable ground; and the court may hear owners. As such, respondent was able to prove compliance with the
and determine the petition after notice to all parties in interest, and may said jurisdictional requirement.
order the entry or cancellation of a new certificate, the entry or cancellation  Aggrieved, petitioner appealed to the CA.
of a memorandum upon a certificate, or grant any other relief upon such
terms and conditions, requiring security or bond if necessary, as it may The CA Ruling
consider proper; Provided, however, That this section shall not be
construed to give the court authority to reopen the judgment or decree of  In a Decision dated June 27, 2013, the CA affirmed the RTC Order.
registration, and that nothing shall be done or ordered by the court which  It found that respondent, by a preponderance of evidence, was able
shall impair the title or other interest of a purchaser holding a certificate to prove, based on the records of the proper government
for value and in good faith, or his heirs and assigns, without his or their authority, i.e., the Office of the Technical Director, Land Management
written consent. Where the owner's duplicate certificate is not presented, Services of the DENR, that the true and correct area of the
a similar petition may be filed as provided in the preceding section. All subject property was 21,298 square meters as shown in the
petitions or motions filed under this Section as well as under any other approved plan.
provision of this Decree after original registration shall be filed and entitled  Moreover, petitioner failed to rebut with contrary evidence
in the original case in which the decree or registration was entered. respondent's claim that she and her co-owners followed the
boundaries in the technical description of OCT No. 46417 when they
WHERE TO FILE PETITION caused its resurvey.
• All petitions or motions after original registration shall be filed and  In fact, no proof had been adduced to show that the boundaries
entitled in the original case in which the decree of registration was entered had been altered.
• This provision doesn’t require that it be under oath  Also, the CA pointed out that none of the adjoining owners, who
• Provision was adopted with an intelligent purpose in view—to allow such were properly notified of the proceedings and who stand to be
petitions and motions to be filed and disposed of elsewhere would adversely affected by the change in the land area of the subject
eventually lead to confusion and render it difficult to trace the origin of the property, objected to respondent's petition.
entries in the registry
TIMELINE: Deed of sale in favor of Galeno and co-owners -> survey
GROUNDS FOR THE AMENDMENT OR ALTERATION OF A and subdivision plan approved by DENR -> discovered discrepancy
CERTIFICATE OF TITLE in sq. m. between title and certification -> petition for correction -
a. when registered interests of any description, whether vested, > RTC granted -> OSG motion for reconsideration -> RTC denied;
contingent, expectant, or inchoate, have terminated and ceased; co-owners were given notice -> CA upheld.
b. when new interests have arisen or been created which do not appear Issue: WON the CA erred in upholding the correction of the area of
upon the certificate; the subject property in OCT No. 46417. - YES
c. when any error, omission or mistake was made in entering a
certificate or any memorandum thereon or on any duplicate Ruling:
certificate;
d. when the name of any person on the certificate has been changed; EVIDENCE PRESENTED BY GALENO IN FAVOR OF CHANGING
e. when the registered owner has been married, or, registered as DISCREPANCY CANNOT BE GIVEN PROBATIVE WEIGHT; PUBLIC
married, the marriage has been terminated and no right or interest OFFICERS DID NOT TESTIFY TO THE SAME
of heirs or creditors will thereby be affected;
f. when a corporation, which owned registered land and has been  A scrutiny of the evidence marked and formally offered by respondent
dissolved, has not conveyed the same within three years after its before the court a quo shows that the former failed to prove that
dissolution; and there was sufficient basis to allow the correction of the area
g. when there is reasonable ground for the amendment or alteration of of the subject property in OCT No. 46417 from 20,948 square
title meters to 21,248 square meters.
Prepared by: Gas

 Records reveal that respondent offered in evidence the following the State cannot be estopped by the omission, mistake or
documents: (a) the Certification issued by a certain Althea C. error of its officials or agents.
Acevedo (Acevedo), Engineer IV, Chief of the Technical Services  Neither is the Republic barred from assailing the decision granting the
Section of the Office of the Regional Technical Director, Land petition for reconstitution [or correction of title, as in this case] if, on
Management Services of the DENR in Iloilo City, which states that the basis of the law and the evidence on record, such petition has no
"the true and correct area of [L]ot 2285, Cad. 246 Dingle Cadastre is merit."
21,928 square meters;" (b) the technical description of Lot No.  Moreover, "in civil cases, the party having the burden of proof
2285, a copy of which was certified by Ameto Caballero must produce a preponderance of evidence thereon, with
(Caballero), Chief of the Surveys Division, while another copy was plaintiff having to rely on the strength of his own evidence and not
certified correct by Acevedo; and (c) the approved subdivision upon the weakness of the defendant's."
plan of Lot No. 2258, certified by Rogelio M. Santome  In fine, the Court holds that respondent did not present any
(Santome), Geodetic Engineer; Alfredo Muyarsas (Muyarsas), competent evidence to prove that the true and correct area of
Chief of the Regional Surveys Division, and Edgardo R. Gerobin the subject property is 21,298 square meters instead of 20,948
(Gerobin), OIC, Regional Technical Director of the Land Management square meters to warrant a correction thereof in OCT No. 46417.
Services, DENR. On the strength of these pieces of evidence,  Accordingly, respondent's petition for the correction of the said
respondent sought a reconciliation of the area of the subject property Certificate of Title must be denied, and the present petition be
with the records of the DENR. granted.
 Unfortunately, the foregoing documentary evidence are not
sufficient to warrant the correction prayed for.
 The Court cannot accord probative weight upon them in view Paz v. Republic
of the fact that the public officers who issued the same did not
testify in court to prove the facts stated therein. Facts:
 (Republic v. Medida) the Court held that certifications of the  On November 29, 2000, the petitioner brought a petition for the
Regional Technical Director, DENR cannot be considered prima cancellation MADE UNDER SEC. 108 OF PD 1529 of Original
facie evidence of the facts stated therein, holding that: Public Certificate of Title (OCT) No. 684.
documents are defined under Section 19, Rule 132 of the Revised  The petition, made under Section 108 of P.D. No. 1529, impleaded
Rules on Evidence as follows: the Republic of the Philippines (Republic), Filinvest Development
a. The written official acts, or records of the official acts of the Corporation (FDC), and Filinvest Alabang, Inc. (FAI) as
sovereign authority, official bodies and tribunals, and public respondents.
officers, whether of the Philippines, or of a foreign country;  The petition averred that the petitioner was the owner of Parcel
b. Documents acknowledged before a notary public except 1, Plan 11-69 and Parcel 2 Plan 11-69; that OCT No. 684 was
last wills and testaments; and registered in the name of the Republic, and included Lot 392
c. Public records, kept in the Philippines, of private documents of the Muntinlupa Estate; that Lot 392 was segregated from OCT
required by law to be entered therein. No. 684, resulting in the issuance of Transfer Certificate of Title
 Applying Section 24 of Rule 132, the record of public documents (TCT) No. 185552, also in the name of the Republic; that FDC and
referred to in Section 19(a), when admissible for any purpose, FAI developed Lot 392 into a subdivision based on their joint venture
may be evidenced by an official publication thereof or by a agreement with the Government; that Lot 392 was further
copy attested by the officer having legal custody of the record, subdivided, causing the cancellation of TCT No. 185552, and the
or by his deputy x x x. issuance of TCTs in the names of the Republic and FAI; and that
 Section 23, Rule 132 of the Revised Rules on Evidence provides: "Sec. the subdivision lots were then sold to third parties.
23. Public documents as evidence. - Documents consisting of entries  The petition for cancellation prayed that OCT No. 684 in the
in public records made in the performance of a duty by a public officer name of the Republic, TCT No. 185552 in the name of the Republic
are prima facie evidence of the facts stated therein. All other public and all subsequent titles derived from said TCT No. 185552 be
documents are evidence, even against a third person, of the fact cancelled and Register of Deeds of Muntinlupa City be ordered
which gave rise to their execution and of the date of the latter." to issue a new certificate of title in the name of Luciano P. Paz
 The CENRO and Regional Technical Director, FMS-DENR, free from all liens and encumbrances, and defendants be ordered
certifications [do] not fall within the class of public documents to vacate the property covered by said title.
contemplated in the first sentence of Section 23 of Rule 132.
 The certifications do not reflect "entries in public records made Filinvest Development Corporation (FDC), and Filinvest Alabang,
in the performance of a duty by a public officer," such as entries Inc. (FAI)
made by the Civil Registrar in the books of registries, or by a ship On January 19, 2001, FDC and FAI moved to dismiss the petition for
captain in the ship's logbook. cancellation on the following grounds, to wit:
 The certifications are not the certified copies or authenticated 1. The Petition for cancellation of title is litigable in an ordinary action
reproductions of original official records in the legal custody outside the special and limited jurisdiction of land registration
of a government office. The certifications are not even records courts and thus removed from the ambit of Sec. 108 of the
of public documents. x x x28 (Emphases supplied) Property Registration Decree;
 As such, sans the testimonies of Acevedo, Caballero, and the 2. Lack of jurisdiction of the Court over the persons of the
other public officers who issued respondent's documentary respondents who were not validly served with summons but
evidence to confirm the veracity of its contents, the same are only a copy of the Petition;
bereft of probative value and cannot, by their mere issuance, 3. Docket fees for the Petition have not been paid.
prove the facts stated therein. 4. The Petition does not contain the requisite certificate of non-
 At best, they may be considered only as prima facie evidence of their forum shopping.
due execution and date of issuance but do not constitute prima
facie evidence of the facts stated therein. Paz:
 The petitioner countered that his petition for cancellation was
CERTIFICATION CONTENTS ARE HEARSAY BECAUSE WITNESS not an initiatory pleading that must comply with the regular rules
WAS INCOMPETENT TO TESTIFY; HEARSAY GIVEN NO PROBATIVE of civil procedure but a mere incident of a past registration
VALUE proceeding and that a service of the petition sufficed to bring the
respondents within the jurisdiction of the trial court.
 In fact, the contents of the certifications are hearsay because
respondent's sole witness and attorney-in-fact, Lea Galeno RTC Ruling:
Barraca, was incompetent to testify on the veracity of their  On May 21, 2001, the RTC granted FDC and FAI's motion to
contents, as she did not prepare any of the certifications, nor was dismiss, stating that the petition at bench bears all the elements of
she a public officer of the concerned government agencies. an action for recovery.
 Notably, while it is true that the public prosecutor who represented  This action although entitled a Petition for cancellation of a title, which
petitioner interposed no objection to the admission of the foregoing is a complaint by itself, is complete with the name of the parties, the
evidence in the proceedings in the court below, it should be borne subject matter, the cause of action, and the reliefs prayed for, which
in mind that "hearsay evidence, whether objected to or not, are all components of a regular complaint.
has no probative value unless the proponent can show that the  It is in fact an initiatory pleading which should be filed and
evidence falls within the exceptions to the hearsay evidence entitled under the original land registration case under the
rule," which do not, however, obtain in this case. instructions of Sec. 2 of PD 1529.
 Verily, while respondent's documentary evidence may have  The petitioner assailed the dismissal in the CA via petition for
been admitted due to the opposing party's lack of objection, it certiorari, ascribing grave abuse of discretion on the part of the RTC.
does not, however, mean that they should be accorded any
probative weight. CA Ruling:
 The Court has explained that: The general rule is that hearsay  On August 1, 2002, the CA dismissed the petition for certiorari
evidence is not admissible. However, the lack of objection to stating that the burden is on Petitioner to prove not merely reversible
hearsay testimony may result in its being admitted as evidence. But error, but grave abuse of discretion amounting to lack or excess of
one should not be misled into thinking that such declarations jurisdiction for the part of Public Respondent.
are thereby impressed with probative value. Admissibility of  As long as a court acts within its jurisdiction, any alleged errors
evidence should not be equated with weight of evidence. committed in the exercise thereof will amount to nothing more
Hearsay evidence whether objected to or not cannot be given than errors of judgment which are reversible by timely appeal
credence for it has no probative value. and not by a special civil action of certiorari (Tomas Claudio Memorial
College, Inc. vs. CA, 316 SCRA 502, Jalandoni vs. Drilon, 327 SCRA
LACK OF OPPOSITION FROM THE GOVERNMENT DOES NOT 107).
ESTOP OFFICIALS FROM ASSAILING GRANT OF  Applying the aforecited jurisprudence, the Petitioner has failed to
RECONSTITUTION overcome the burden of proving how Public Respondent may
be faulted with having acted with grave abuse of discretion in
 Besides, case law states that the "absence of opposition from rendering judgment ordering the dismissal of his Petition.
government agencies is of no controlling significance because  That the court a quo cannot share Petitioner's interpretation of
certain alleged laws and jurisprudence hardly constitute the
Prepared by: Gas

abuse of discretion contemplated under Rule 65 of the 1997 Rules  Moreover, the filing of the petition would have the effect of
of Civil Procedure reopening the decree of registration, and could thereby impair
 CA denied the petitioner's motion for partial reconsideration. the rights of innocent purchasers in good faith and for value.
 To reopen the decree of registration was no longer permissible,
TIMELINE: Petition for cancellation -> opposed by Filinvest -> RTC considering that the one-year period to do so had long ago lapsed,
granted dismissal of case, pleading should be filed under the and the properties covered by OCT No. 684 had already been
original land registration case under Sec. 2 PD 1529 -> CA subdivided into smaller lots whose ownership had passed to third
affirmed, stating that certiorari was not the correct remedy for persons.
errors in judgment  Thusly, the petition tended to violate the proviso in Section 108 of
P.D. No. 1529, to wit:
Issue: Whether or not petition filed under Section 108 of P.D. 1529 . . . Provided, however, that this section shall not be construed
should be dismissed because it was exempt from the requirements to give the court authority to reopen the judgment or decree of
of paying docket fees, of service of summons, and of the registration, and that nothing shall be done or ordered by the
certification against forum shopping due to its not being an court which shall impair the title or other interest of a purchaser
initiatory pleading. holding a certificate for value in good faith, or his heirs and
assigns without his or their written consent. Where the owner's
Ruling: duplicate certificate is not presented, a similar petition may be
filed as provided in the preceding section.
DISMISSAL WAS PROPER BECAUSE RTC DID NOT ABUSE ITS  Accordingly, he should perform jurisdictional acts, like paying
DISCRETION the correct amount of docket fees for the filing of an initiatory
pleading, causing the service of summons on the adverse
 The dismissal of the petition for certiorari by the CA was proper and parties in order to vest personal jurisdiction over them in the
correct because the RTC did not abuse its discretion, least of all trial court, and attaching a certification against forum
gravely. Section 108 of P.D. No. 1529 reads as follows: (just shopping (as required for all initiatory pleadings).
included, in case asked to be read)  He ought to know that his taking such required acts for granted was
Section 108. Amendment and alteration of certificates. — No immediately fatal to his petition, warranting the granting of the
erasure, alteration, or amendment shall be made upon the respondents' motion to dismiss.
registration book after the entry of a certificate of title or of a
memorandum thereon and the attestation of the same by the Cabañez v. Solaño
Register of Deeds, except by order of the proper Court of First Facts:
Instance. A registered owner or other person having interest in the  Subject of the present controversy are 2 parcels of lands owned by
registered property, or, in proper cases, the Register of Deeds with respondent Maria Cabanez who is married to Benjamin Cabanez,
the approval of the Commissioner of Land Registration, may apply the petitioner.
by petition to the court upon the ground that the registered interest  On Feb. 12, 2007, respondent filed with the RTC of Muntinlupa City a
of any description, whether vested, contingent, expectant or “Petition for Correction of the Name and Marital Status of the
inchoate appearing on the certificate, have terminated and ceased; Registered Owner of Transfer Certificates of Title of the Registry
or that new interest not appearing upon the certificate have arisen of Deeds for Muntinlupa City.”
or been created; or that an omission or an error was made in
entering a certificate or any memorandum thereon, or on any RTC Ruling
duplicate certificate: or that the same or any person in the certificate  On June 28, 2007, the RTC of Muntinlupa, Branch 203, rendered its
has been changed or that the registered owner has married, or, if Decision in favor of the Petitioner.
registered as married, that the marriage has been terminated and  It held that from the evidence presented by respondent, it has
no right or interest of heirs or creditors will thereby be affected; or been satisfactorily established that the subject properties
that a corporation which owned registered land and has been should indeed be in respondent’s name and that her status
dissolved has not yet convened the same within three years after its should be single.
dissolution; or upon any other reasonable ground; and the court
may hear and determine the petition after notice to all parties in CA Ruling
interest, and may order the entry or cancellation of a new certificate,
the entry or cancellation of a memorandum upon a certificate, or  Not satisfied with the ruling of RTC, petitioner filed with the CA a
grant any other relief upon such terms and conditions, requiring Petition for annulment of judgment on the ground that
security and bond if necessary, as it may consider proper; petition was not published in a newspaper of general
Provided, however, That this section shall not be construed circulation and other persons who may have interest in the
to give the court authority to reopen the judgment or decree properties were not served summons.
of registration, and that nothing shall be done or ordered by  This was granted by the CA and annulled and set aside the decision
the court which shall impair the title or other interest of a of the RTC. Respondent failed to comply with requirements under
purchaser holding a certificate for value and in good faith, or Rule 108 of Rules of Court; she also failed to serve summons to
his heirs and assigns without his or their written consent. petitioner.
Where the owner's duplicate certificate is not presented, a similar  Respondent Filed a Motion for Reconsideration contending that
petition may be filed as provided in the preceding section. the provisions of PD 1529 and not Rule 108 of the Rules of
All petitions or motions filed under this section as well as any Court, should be applied in the present case; posting of notice of
other provision of this decree after original registration shall be respondent’s petition is deemed constructive notice; petition is an
filed and entitled in the original case in which the decree of action in rem where jurisdiction of the defendant is not a prerequisite
registration was entered. to confer jurisdiction on the court, provided that the court acquires
jurisdiction over the res.
PETITION DID NOT FALL UNDER ANY OF THE 7 INSTANCES;  CA rendered a decision in favor of respondent. PD 1529 is the
IN REALITY, IT WAS REQUESTING RECONVEYANCE, NOT governing law; nothing under the provisions state that
CANCELLATION AS CONTEMPLATED BY SEC. 108 publication is a requirement for RTC to acquire jurisdiction
over respondent’s petition. Petitioner also failed to prove
 Based on the provision, the proceeding for the amendment and existence of extrinsic fraud as a ground for annulling assailed
alteration of a certificate of title under Section 108 of P.D. No. 1529 judgment of RTC.
is applicable in seven instances or situations, namely:  Petitioner filed a MR but was denied by the CA.
(a) when registered interests of any description, whether vested, TIMELINE: Cabanez (girl) filed petition for correction of name and
contingent, expectant, or inchoate, have terminated and ceased; marital status in CTs -> RTC granted -> Cabanez (male) filed
(b) when new interests have arisen or been created which do not petition for annulment with CA -> CA granted -> Cabanez (girl)
appear upon the certificate; filed a motion for reconsideration -> CA granted -> MFR denied by
(c) when any error, omission or mistake was made in entering CA
a certificate or any memorandum thereon or on any duplicate
certificate; Issues:
(d) when the name of any person on the certificate has been  Whether or not amendment and alteration of Certificates of
changed; Title Provided for under section 108 of PD 1529 is an in rem
(e) when the registered owner has been married, or, registered proceedings that requires strict compliance with the
as married, the marriage has been terminated and no right or publication requirements.
interest of heirs or creditors will thereby be affected;  Whether or not sec. 3 and 4 of Rule 108 of the Rules of Court
(f) when a corporation, which owned registered land and has been suppletorily apply to the proceedings provided for under
dissolved, has not conveyed the same within three years after section 108 of PD 1529 wherein the requirement of
its dissolution; and publication is mandatory.
(g) when there is reasonable ground for the amendment or
alteration of title. Ruling:
FILING OF PETITION WOULD HAVE THE EFFECT OF PRAYED AMENDMENTS ARE CONTROVERSIAL; SEC. 108 OF
REOPENING THE DECREE AND IMPAIR RIGHTS OF INNOCENT PD 1529 APPLIES ONLY TO NON-CONTROVERSIAL
PURCHASERS; ONE YEAR PERIOD HAS LAPSED AMENDMENTS
 Here, the petitioner was in reality seeking the reconveyance of  The court finds merit in the petition, but for reasons which are not
the property covered by OCT No. 684, not the cancellation of identical as those by petitioner.
a certificate of title as contemplated by Section 108 of P.D. No.  The CA ruled on the basis of the provisions of PD 1529, specifically,
1529. the CA cited Sections 2 and 108 of the said law which provides
 Thus, his petition did not fall under any of the situations that:
covered by Section 108, and was for that reason rightly
dismissed.
Prepared by: Gas

SEC. 2. Nature of registration proceedings; jurisdiction of  Certainly, such objective cannot be accomplished by the court
courts. — Judicial proceedings for the registration of lands through the abbreviated action under Section 108 of PD 1529.
throughout the Philippines shall be in rem and shall be based on the  A complete determination of the issues in the present case can only
generally accepted principles underlying the Torrens system. Courts be achieved if petitioner and his wife are impleaded in an adversarial
of First Instance shall have exclusive jurisdiction over all applications proceeding.
for original registration of title to lands, including improvements and
interests therein, and over all petitions filed after original registration RESPONDENT FAILED TO COMPLY WITH REQUIREMENTS; WHERE
of title, with power to hear and determine all questions arising upon AUTHORITY IS CONFERRED BY STATUTE, MANNER OF OBTAINING
such applications or petitions. The court through its clerk of court shall JURISDICTION IS MANDATORY; CA ERRS IN STATING THAT
furnish the Land Registration Commission with two certified copies of PUBLICATION IS NOT A JURISDICTIONAL REQUIREMENT
all pleadings, exhibits, orders, and decisions filed or issued in
applications or petitions for land registration, with the exception of  Respondent failed to comply with the said requirements. In all cases
stenographic notes, within five days from the filing or issuance where the authority of the courts to proceed is conferred by a
thereof. statute, and when the manner of obtaining jurisdiction is
mandatory, it must be strictly complied with, or the proceedings
SECTION 108. Amendment and alteration of certificates. — No will be utterly void.
erasure, alteration, or amendment shall be made upon the  It is wrong for the CA to rule in its Amended Decision that
registration book after the entry of a certificate of title or of a publication is not a jurisdictional requirement for the RTC to
memorandum thereon and the attestation of the same be Register of take cognizance of respondent's petition.
Deeds, except by order of the proper Court of First Instance. A  The appellate court's reliance on the case of Chan v. Court of
registered owner of other person having an interest in registered Appeals is misplaced. In the said case, this Court considered the
property, or, in proper cases, the Register of Deeds with the approval notice to the Register of Deeds as substantial compliance with
of the Commissioner of Land Registration, may apply by petition to the notice and publication requirements of the law simply
the court upon the ground that the registered interests of any because in the petition for correction filed by the petitioner therein,
description, whether vested, contingent, expectant or inchoate only the said petitioner and the Register of Deeds had an interest in
appearing on the certificate, have terminated and ceased; or that new the correction of titles sought for.
interest not appearing upon the certificate have arisen or been  This Court ruled that there is therefore no necessity to notify
created; or that an omission or error was made in entering a other parties who had no interest to protect in the said petition.
certificate or any memorandum thereon, or, on any duplicate This is not true, however, in the present case. As discussed
certificate; or that the same or any person on the certificate has been above, on the bases of petitioner's serious objection and adverse
changed; or that the registered owner has married, or, if registered claim, it is apparent that he has an interest to protect. Thus, the
as married, that the marriage has been terminated and no right or ruling in Chan finds no application in the instant case.
interests of heirs or creditors will thereby be affected; or that a
corporation which owned registered land and has been dissolved has
not convened the same within three years after its dissolution; or Notice and Replacement of Lost Duplicate Certificate (Sec. 109)
upon any other reasonable ground; and the court may hear and
determine the petition after notice to all parties in interest, and may Section 109. Notice and replacement of lost duplicate certificate.
order the entry or cancellation of a new certificate, the entry or In case of loss or theft of an owner's duplicate certificate of title, due notice
cancellation of a memorandum upon a certificate, or grant any other under oath shall be sent by the owner or by someone in his behalf to the
relief upon such terms and conditions, requiring security or bond if Register of Deeds of the province or city where the land lies as soon as the
necessary, as it may consider proper; Provided, however, That this loss or theft is discovered. If a duplicate certificate is lost or destroyed, or
section shall not be construed to give the court authority to reopen cannot be produced by a person applying for the entry of a new certificate
the judgment or decree of registration, and that nothing shall be done to him or for the registration of any instrument, a sworn statement of the
or ordered by the court which shall impair the title or other interest fact of such loss or destruction may be filed by the registered owner or
of a purchaser holding a certificate for value and in good faith, or his other person in interest and registered. Section 109 is the applicable law
heirs and assigns, without his or their written consent. Where the in petitions for the issuance of new owner’s duplicate certificate which are
owner's duplicate certificate is not presented, a similar petition may lost or stolen or destroyed RA 26 applies only in cases of reconstitution of
be filed as provided in the preceding section. lost or destroyed original certificates of title on file with the RD
 All petitions or motions filed under this Section as well as under any
other provision of this Decree after original registration shall be filed PROCEDURAL REQUIREMENTS
and entitled in the original case in which the decree or a. The registered owner or other person in interest shall send notice, under
registration was entered. oath, of the loss or destruction of the owner’s duplicate certificate of title
 The Court notes that the petition was clearly one which was filed to the RD of the province or city where the land lies as soon as the loss or
after original registration of title, as provided under the above destruction is discovered;
quoted Section 2 of PD 1529. b. The corresponding petition for the replacement of the loss or destroyed
 Moreover, respondent's petition was filed with the RTC for the owner’s duplicate certificate shall then be filed in court and entitled in the
purpose of correcting supposed errors which were committed original case in which the decree of registration was entered;
when entries were made in the subject TCTs, as contemplated c. The petition shall state under oath the facts and circumstance
under Section 108 of the same law. surrounding such loss or destruction;
 However, under settled jurisprudence, the enumerated d. The court shall set the petition for hearing, after due notice to the RD
instances for amendment of alteration of a certificate of title and all other interested parties as shown in the memorandum of
under Section 108 of PD 1529 are non-controversial in nature. encumbrances noted in the original or transfer certificate of title on file in
They are limited to issues so patently insubstantial as not to the office of the RD;
be genuine issues. e. After due notice and hearing, the court may direct the issuance of a new
 The proceedings thereunder are summary in nature, duplicate certificate which shall contain a memorandum of the fact that it
contemplating insertions of mistakes which are only clerical, but is issued in place of the lost or destroyed certificate and shall in all respects
certainly not controversial issues. be entitled to the same faith and credit as the original duplicate.
 In the present case, the Court notes that in a separate action for
annulment of title and recovery of ownership filed by PETITION, WHERE FILED
petitioner's wife against respondent, the RTC of Makati City, A petition for replacement shall be filed with the RTC of the place where
Branch 137, in its decision in Civil Case No. 91-2648, dated July 5, the land lies and this is true even if the title was issued pursuant to a public
1993, made a categorical finding that petitioner and his wife land patent registered in accordance with Section 103 of this decree
are the lawful owners of the subject properties and ordering
respondent to surrender possession thereof to the said spouses. Things to Remember:
 This RTC judgment was later affirmed by the CA in its Decision 18 in - There is no requirement for publication of the petition for replacement
CA-G.R. CV No. 49446, dated April 29, 1997. of lost or destroyed certificate.
 Respondent, on the other hand, claims that she together with - If the owner’s duplicate certificate of title was never lost or destroyed,
petitioner and his wife subsequently executed an amicable a petition for the issuance of a new owner’s duplicate copy is
settlement dated June 22, 2000, which was approved by the RTC, unwarranted, as in fact, the court has no jurisdiction over the petition,
wherein petitioner's wife waived her rights and interests over and any issuance pursuant to such is null and void.
the said properties. - Petition shall be filed with the RTC of the place where the land lies
 She also alleged that petitioner executed an Affidavit of
Declaration against Interest, dated January 22, 2007, indicating Coombs v. Castañeda
that he has no right or interest over the subject properties.
 Petitioner, nonetheless, claims that he executed a subsequent Facts:
Affidavit of Non-Waiver of Interest, dated January 14, 2008,  This case stemmed from a petition for annulment of judgment
claiming that he was deceived by respondent into signing the to declare the August 26, 2004 Decision of the Regional Trial Court
said Affidavit of Declaration Against Interest and that he was (RTC), Branch 206, Muntinlupa City in LRC Case No. 04-035 as null
seriously ill at the time that he affixed his signature. and void, filed by herein petitioner Mercedita C. Coombs (Coombs)
 From the foregoing, there is no question that there is a serious before the Court of Appeals. The dispositive portion of the RTC
objection and an adverse claim on the part of an interested Decision reads:
party as shown by petitioner's subsequent execution of his WHEREFORE, judgment is hereby rendered declaring the lost
Affidavit of Non-Waiver of Interest. owner's duplicate copy of Transfer Certificate of Title [No.] 6715
 The absence of unanimity among the parties is also evidenced by of the Registry of Deeds of Muntinlupa City as null and void.
petitioner's petition seeking the annulment of the RTC Decision which Accordingly, the Register of Deeds of Muntinlupa City is ordered
granted respondent's petition for correction of entries in the subject to issue a new owner's duplicate copy of the said TCT No. 6715
TCTs. under the same terms and conditions as the original thereof and
 These objections and claims necessarily entail litigious and to include thereon all annotations which have not been lawfully
controversial matters making it imperative to conduct an ordered cancelled by the Court upon payment of all fees
exhaustive examination of the factual and legal bases of the prescribed by law.
parties' respective positions.
Prepared by: Gas

 Petitioner Coombs is the owner of the real property covered by
Transfer Certificate of Title (TCT) No. 6715 situated on Apitong Ruling:
Street, Ayala Alabang, Muntinlupa City.
 Sometime in March 2005, when she tried to pay the real property tax THE RTC DID NOT HAVE JURISDICTION OVER THE SUBJECT
due relative to the real property covered by TCT No. 6715, she was MATTER; RTC HAS NO JURISDICTION OVER MATTERS WHERE
told that said real property was no longer listed under her CERTIFICATE SOUGHT TO BE RECONSTITUTED WAS NEVER LOST
name. OR DESTROYED BUT IN THE POSSESSION OF ANOTHER PERSON
 Upon further verification, she came to know that TCT No. 6715
had already been cancelled and had been replaced by TCT No.  In her petition, petitioner Coombs averred as follows:
14115 issued in the name of herein respondent Virgilio Veloso  Since the owner's duplicate copy of TCT No. 6715 is not lost or
Santos (Santos); that TCT No. 6715 was ordered cancelled by the destroyed, but is in fact in the possession of the petitioner,
RTC in a Decision dated August 26, 2004 in LRC Case No. 04-035, there is no necessity for the petition filed in the trial court. The
entitled "In Re: Petition for the Issuance of Second Owner's Duplicate Regional Trial Court Branch 206 in Muntinlupa City never acquired
Copy of Transfer Certificate of Title No. 6715, [by jurisdiction to entertain the petition and order the issuance of a new
Mercedita C. Coombs, represented by her Atty.-in-Fact owner's duplicate certificate. Hence, the newly issued duplicate of TCT
Victoria C. Castaneda". No. 6715 is null and void.
 Petitioner neither authorized Victoria C. Castaneda  Contrary to the findings of the Court of Appeals, the Petition for
(Castaneda) to file the petition for issuance of a second Annulment of Judgment filed by petitioner Coombs was clearly
owner's duplicate copy of TCT No. 6715 sometime in 2004, nor grounded on lack of jurisdiction of the RTC over the subject
asked her to sell the subject property to herein respondent matter of the case, and not extrinsic fraud.
Santos; that Santos, in turn, sold the same to herein  The allegations in her petition made out a prima facie case of
respondents Pancho and Edith Leviste (spouses Leviste ); that annulment of judgment that should have warranted the Court of
the spouses Leviste executed a real estate mortgage over the Appeals' favorable consideration.
subject property in favor of herein respondent Bank of the Philippine  In Manila v. Manzo, the Court held that in a petition for
Islands Family Savings Bank (BPI Family). annulment of judgment grounded on lack of jurisdiction, it is
 Petitioner Coombs anchored her prayer for the annulment of the not enough that there is an abuse of jurisdictional discretion.
RTC Decision on the ground that, since the owner's duplicate It must be shown that the court should not have taken
copy of TCT No. 6715 had never been lost as it had always cognizance of the case because the law does not confer it with
been in her custody, the RTC did not acquire jurisdiction over jurisdiction over the subject matter.
the subject matter of LRC Case No. 04-035.  It is doctrinal that jurisdiction over the nature of the action or subject
matter is conferred by law.
CA Decision:  Section 10 of Republic Act No. 26 vests the RTC with jurisdiction over
 Relying mainly on Sections 1 and 2 of Rule 47 of the Revised Rules of the judicial reconstitution of a lost or destroyed owner's duplicate of
Court, the Court of Appeals dismissed the petition for annulment of the certificate of title.
judgment.  However, the Court of Appeals erred when it ruled that the subject
RULE 47 - Annulment of Judgments of Final Orders and matter of LRC Case No. 04-035 was within the RTC's jurisdiction,
Resolutions being a court of general jurisdiction.
Section 1. Coverage. — This Rule shall govern the annulment  In a long line of cases, the Court has held that the RTC has no
by the Court of Appeals of judgments or final orders and jurisdiction when the certificate sought to be reconstituted
resolutions in civil actions of Regional Trial Courts for which the was never lost or destroyed but is in fact in the possession of
ordinary remedies of new trial, appeal, petition for relief or other another person.
appropriate remedies are no longer available through no fault of  In other words, the fact of loss of the duplicate certificate is
the petitioner. jurisdictional.
Section 2. Grounds for annulment. — The annulment may be  Thus, petitioner Coombs' mere allegation that the owner's
based only on the grounds of extrinsic fraud and lack of duplicate copy of TCT No. 7615 was never lost and has in fact
jurisdiction. always been with her gave rise to a prima facie case of the
Extrinsic fraud shall not be a valid ground if it was availed RTC's lack of jurisdiction over the proceedings in LRC Case No.
of, or could have been availed of, in a motion for new trial 04-035. This is exactly the situation a petition for annulment of
or petition for relief. judgment aims to remedy.
 The CA said that there is no allegation in the petition that the FAILURE TO AVAIL OF THE REMEDIES UNDER SEC. 1 OF RULE 47
petitioner has failed to avail of any of the remedies in Section IS NOT FATAL TO HER CASE; JUDGMENT RENDERED WITHOUT
1 through no fault of his own before instituting the present petition. JURISDICTION IS FUNDAMENTALLY VOID
The petition is also not sufficient in substance.
 Under Section 2 of Rule 47 of the Rules of Civil Procedure, the grounds  When a petition for annulment of judgment is grounded on lack of
for Annulment of Judgment are: jurisdiction, the petitioner need not allege that the ordinary
remedy of new trial or reconsideration of the judgment sought
(a) lack of jurisdiction of the lower court; and to be annulled are no longer available through no fault of her
(b) extrinsic fraud. own.
 This is because a judgment rendered without jurisdiction is
 The CA said that the ground petitioner obviously relied upon in fundamentally void.
the present action is extrinsic fraud.  Thus, it may be questioned any time unless laches has already
 However, the petitioner failed to state the facts constituting set in.
extrinsic fraud as a ground.
 Since the petitioner failed to avail of any of aforementioned remedies FAILURE OF PETITIONER TO APPEND AFFIDAVITS OF WITNESSES
in Section 1 without justification and that the ground relied upon was AS REQUIRED BY SEC. 4 OF RULE 47 IS NOT FATAL TO HER CASE
not substantiated, the petition, therefore has no prima facie merit.
 Petitioner Coombs filed a Motion for Reconsideration. She  Petitioner annexed to her petition the owner's duplicate copy of TCT
insisted that her petition was grounded on lack of jurisdiction, No. 6715 and the RTC Decision - which sufficiently support the
not extrinsic fraud. petition's cause of action.
 In fact, she explicitly spelled out in her petition that the RTC did not  A copy of the TCT alleged to have been missing supports the claim
have jurisdiction over the subject matter in LRC Case No. 04- that the same was never lost. In the same vein, a copy of the RTC
035 because the owner's duplicate copy of TCT No. 6715 was Decision, in conjunction with supporting jurisprudence,
never lost. supports petitioner Coombs' averment that said decision was
 The Court of Appeals denied the said motion and explained that rendered without jurisdiction.
the RTC has jurisdiction over all proceedings involving title to real  Her allegations coupled with the appropriate supporting documents
property and land registration cases. give rise to a prima facie case that the RTC did not have jurisdiction
 Thus, it had jurisdiction over the subject matter of LRC Case No. over the subject matter in LRC Case No. 04-035.
04-035. It further held that petitioner Coombs failed to append  As we ruled in Tan Po Chu v. Court of Appeals, if allegations of this
affidavits of witnesses or documents supporting her cause of nature turned out to be true, the RTC Decision would be void
action as required by Section 4, Rule 47 of the Rules of Court. and the Court of Appeals would have been duty-bound to
 It cited Veneracion v. Mancilla, where it was held that failure to strike it down.
append the necessary documents may prompt the appellate court to  Thus, the appellate court erred when it brushed aside this duty and
dismiss the petition outright or deny the same due course. dismissed the case outright based on a strict interpretation of
technical rules.
TIMELINE: Coombs owns property -> tried to pay real property tax  WHEREFORE, the petition is hereby GRANTED. The Resolutions of
but was told it was not listed in her name -> discovered that her the Court of Appeals are SET ASIDE. The Court of Appeals is directed
TCT was cancelled and issued to Santos thru Castaneda (filed to REINSTATE the Petition for Annulment of Judgment.
petition for issuance of duplicate copy) -> Santos sold to Pancho
and Leviste -> Leviste executed real estate mortgage over subject
property with BPI -> Petition for annulment of judgment by Tan Po Chu v. CA
Coombs to CA -> CA dismissed petition, failing to state facts
constituting extrinsic fraud Principle: When the owner's duplicate certificate of title has not been lost,
but is in fact in the possession of another person, then the reconstituted
Issues: certificate is void because the court failed to acquire jurisdiction over the
 Did the RTC have jurisdiction over the subject matter in LRC subject matter — the allegedly lost owner's duplicate. The correct remedy
Case No. 04-035? for the registered owner against an uncooperative possessor is to compel
 Is the failure of petitioner to avail of the remedies under Sec. the surrender of the owner's duplicate title through an action for replevin.
1 of Rule 47 fatal to her case?
 Is the failure of petitioner to append affidavits of witnesses as Facts:
required by Sec. 4 of Rule 47 fatal to her case?
Prepared by: Gas

 Fiber Technology Corporation (FiberTech) was a Philippine  The proper remedy should have been an appeal. Certiorari is an
corporation with (SEC) Registration No. 0000142818. extraordinary remedy of last resort for when another remedy is
 It was also the registered owner of a parcel of land in present, certiorari is not available.
Marikina (subject lot) covered by Transfer Certificate of  It is a limited form of review confined to errors of jurisdiction.
Title (TCT) No. 157923 entered on November 28, 1988.  An error of jurisdiction is one where the officer or tribunal
 The SEC allegedly revoked FiberTech's registration on acted without or in excess of its jurisdiction, or with grave abuse
September 29, 2003. of discretion amounting to lack or excess of jurisdiction.
 On April 4, 2005, respondent Felix Chingkoe executed an affidavit  On the other hand, an error of judgment is one which the court
of loss of TCT No. 157923 allegedly on behalf of FiberTech. may commit in the exercise of its jurisdiction. They only involve
 On June 2, 2005, FiberTech — supposedly represented by errors in the court or tribunal's appreciation of the facts and of the
respondent Rodrigo Garcia pursuant to a December 2, 2004 Board law. Errors of jurisdiction are reviewable on certiorari; errors of
Resolution— filed a petition for the reissuance/replacement of judgment, only by appeal.
its owner's duplicate of TCT No. 157923.  (BUT) Ordinarily, this Court would have dismissed the petition
 The petition was based on the affidavit of loss that Felix outright for being an improper remedy. As a general
executed. The petition alleged: rule, certiorari will not lie as a substitute for an appeal.
 However, an exception to this rule is where public welfare and
(1) that Felix and his wife Rosita acquired 100% ownership the advancement of public policy so dictates.
of FiberTech in 2004 pursuant to an award by the National Labor  This Court cannot ignore the implications if the petitioner's
Relations Commission (NLRC); allegations — that she has the original owner's duplicate TCT
(2) that Felix was elected Corporate Secretary soon after; of the subject lot and that the SEC revoked FiberTech's
(3) that Felix asked the former directors and officers of registration in 2003 — are true.
FiberTech to turn over the owner's duplicate of TCT No. 157923,  There currently exists two owners’ duplicate TCTs over the
but the latter denied knowledge or possession thereof; and same property possessed by two contending factions in an
(4) that after conducting an exhaustive search, the subject title intra-corporate dispute of a defunct corporation.
was nowhere, to be found.  This anomalous situation can potentially bring considerable
harm to the general public and to the integrity of our Torrens
RTC Ruling system. This Court, therefore, cannot simply leave the parties as
they were.
 The petition was raffled to the RTC, Marikina City, Branch 193 and
docketed as LRC Case No. 2005-771-MK. GENERAL RULE: Certiorari is not the proper remedy as a substitute
 On July 23, 2006, the RTC granted the petition. for appeal.
 It declared the owner's duplicate copy of TCT No. 157923 as lost
and ordered its reissuance. EXC: Where public welfare and advancement of public policy
 On December 21, 2007, Tan Po Chu — mother of Fibertech's dictates, it shall be allowed.
incorporators Faustino and respondent Felix Chingkoe — filed a
petition before the CA for annulment of judgment against the
RTC's decision. CA COMMITTED GRAVE ABUSE OF DISCRETION
 The petition was docketed as CA-G.R. SP No. 101727 with Tan Po
Chu and FiberTech as petitioners.  The CA committed a grave error when it brushed aside Tan's
 Tan alleged: argument that the RTC rendered its decision without jurisdiction.
 It ruled that the replacement of a lost duplicate certificate is a
(1) that the missing owner's duplicate of TCT was in her proceeding in rem, directed against the whole world; therefore, the
custody as the responsible officer of FiberTech; RTC acquired jurisdiction when it complied with the notice and
(2) that Felix was aware of this fact; hearing requirements under Section 109 of P.D. 1529.
(3) that Felix committed perjury when he executed the  The CA completely missed the point because Tan did not assail the
Affidavit of Loss; RTC's jurisdiction by alleging noncompliance with the
(4) that Felix and Rosita had not acquired 100% ownership requirements of notice and hearing; she questioned the RTC's
of FiberTech; jurisdiction over the res by claiming that the allegedly lost
(5) that Rosita and Rodrigo Garcia were not even owner's duplicate was, in fact, not lost but was in her custody.
stockholders of record in Fibertech; and Therefore, the RTC's compliance with Section 109 of P.D. 1529 was
(6) that the respondents had no authority to file the petition irrelevant.
for reissuance of the owner's duplicate copy on behalf of FiberTech.  We have consistently held that when the owner's duplicate
certificate of title has not been lost, but is in fact in the
 Citing New Durawood Co. v. Court of Appeals and Serra Serra v. possession of another person, then the reconstituted
Court of Appeals, Tan further argued that if an owner's duplicate TCT certificate is void because the court failed to acquire
has not been lost, but is in fact possessed by another person, then jurisdiction over the subject matter — the allegedly lost
the reconstituted title is void and the court that rendered the owner's duplicate.
decision never acquired jurisdiction.  The correct remedy for the registered owner against an
uncooperative possessor is to compel the surrender of the
CA Ruling owner's duplicate title through an action for replevin.
 However, the CA dismissed Tan's petition outright on January  Moreover, the CA's dismissal based on technical grounds was
16, 2008 on the grounds that the petition suffered from erroneous. The CA raised the following procedural infirmities: .
procedural infirmities and lacked substantial merit. ..
 The CA observed that: (1) the verification and certification of non-forum
(1) the verification and certification of non-forum shopping were shopping was executed alone by affiant Tan Po Chu without any
executed alone by Tan Po Chu without showing that she had the showing that [s]he had the authority to sign for and in behalf of
authority to sign for and on behalf of the corporation; petitioner corporation pursuant to Sec. 5(1), Rule 7 and Sec. 4(3),
(2) Tan's actual address was not indicated in the petition as Rule 47 of the 1997 Revised Rules of Civil Procedure considering that
required by Rule 46, Section 3; and [s]he is one of the incorporators and stockholders of her co-petitioner
(3) the attached copy of the owner's duplicate TCT No. 157923 corporation;
was not a certified true copy. (2) The actual address of petitioner Tan Po Chu is not
 The CA also brushed aside Tan's substantive argument. It held indicated in the petition as required by Sec. 3 (1), Rule 46 of the
that the RTC acquired jurisdiction over the case after same Rule;
complying with the notice and hearing requirements under (3) The copy of the owner's duplicate of TCT No. 157923 is not
Section 109 of Presidential Decree (P.D.) No. 1529 or the Property certified as a true copy of the original owner's duplicate by the
Registration Decree. proper government agency as alleged by the petitioners.
 Tan moved for reconsideration. However, on July 16, 2008, the
CA denied the motion, insisting that Tan's assertion that the RTC  First, we note that Tan alleged that FiberTech's corporate existence
lacked jurisdiction was without merit. had already ceased when the SEC revoked its corporate
registration on September 29, 2003, and that she was a trustee
TIMELINE: Fibertech was registered with SEC and had registered of the corporation for the purpose of its dissolution. We note
land -> SEC revoked registration -> Chingkoe filed an affidavit of further that the petition for annulment was filed in the names
loss -> Fibertech filed a petition for replacement of duplicate copy of both FiberTech and Tan Po Chu.
based on affidavit of loss -> RTC granted -> Tan Po Chu filed a  While FiberTech may no longer have judicial personality to
petition for annulment of judgment -> CA dismissed petition for initiate the suit or authorize Tan Po Chu to file the case, Tan
procedural infirmities Po Chu remained a real party-in-interest as the lawful
possessor of the allegedly lost owner's duplicate TCT.
Issues:  The respondents could not legally oust her of this possession
 Was the remedy of certiorari instead of an appeal proper? by reconstituting the owner's duplicate instead of filing an
 Did the CA commit grave abuse of discretion in dismissing Tan action for replevin. Therefore, the verification and certification of
Po Chu’s petition regarding the matter on lack of jurisdiction non-forum shopping remained valid with respect to Tan Po Chu even
of the RTC? though it might have been defective with respect to FiberTech.
 Second, we also note that Tan Po Chu submitted her address in
Ruling: her motion for reconsideration to cure the defect in the petition.
Her motion for reconsideration substantially complies with Rule
APPEAL SHOULD HAVE BEEN THE PROPER REMEDY; HOWEVER, 46, Section 3 of the Rules of Court.
BECAUSE PUBLIC WELFARE DICTATES, THE PROCEDURAL LAPSE  Finally, a petition for annulment of judgment only requires the
IS DEEMED CURED inclusion of a clearly legible duplicate original or certified true
copy of the judgment, order, resolution, or ruling subject
thereof. It does not require the petitioner to annex certified true
copies or duplicate originals of his evidence to the petition because
Prepared by: Gas

these may be presented during the evidentiary hearings of the case. b. That the documents presented by petitioner are sufficient and proper to
To our mind, none of the procedural infirmities warranted the CA's warrant reconstitution of the lost or destroyed certificate of title;
outright dismissal of the case. c. That the petitioner is the registered owner of the property or had an
 Fallo: WHEREFORE, we hereby GRANT the petition. The January 16, interest therein;
2008 and the July 16, 2008 resolutions of the Court of Appeals in CA- d. That the certificate of title was in force at the was lost or destroyed; and
G.R. SP No. 101727 are ANNULLED and SET ASIDE. The Court of e. That the description, area and boundaries of the property are
Appeals is further DIRECTED to PROCEED hearing the case. substantially the same and those contained in the lost or destroyed
certificate of title.
Gocheco v. Estacio
Facts: SOURCES OF RECONSTITUTION FOR OCT (SEC. 2, RA 26)
 Cesario Gocheco, legitimate son of Paulino Gocheco, filed a Original certificates of title shall be reconstituted from such of the sources
petition in court for the issuance of a new owner’s duplicate copy hereunder enumerated as may be available, in the following order:
of his father’s title to a parcel of land in Margosarubig, Zamboanga a. The owner’s duplicate of the certificate of title;
del Sur. b. The co-owner’s, mortgagee’s, or lessee’s duplicate of the certificate of
 The owner’s duplicate copy of the certificate of title No. O- title;
1385 was lost despite diligent search to ascertain its c. A certified copy of the certificate of title, previously issued by the register
whereabouts. Moreover, the records in the Register of Deeds of the of deeds or by a legal custodian thereof;
said title was found to be intact and complete. d. An authenticated copy of the decree of registration or patent, as the
 However, Francisco T. Estacio, et.al. opposed the petition alleging case may be, pursuant to which the original certificate of title was issued;
that they have been in continuous, peaceful, lawful, public, e. A document, on file in the registry of deeds, by which the property, the
and adverse possession of the said property. Gocheco, on the other description of which is given in said document, is mortgaged, leased or
hand, averred that the oppositors had no personality to encumbered, or an authenticated copy of said document showing that its
intervene in the proceedings. original had been registered; and
 Moreover, the oppositors failed to show up for the hearing f. Any other document which, in the judgment of the court, is sufficient
despite notice. The trial court then decided to suspend the hearing and proper basis for reconstituting the lost or destroyed certificate of title.
of the petition and ordered Gocheco to either (a) publish within 30
days his petition or (b) file a testate or intestate proceeding in order TWO TYPES OF RECONSTITUTION
to secure the appointment of a legal representative to the estate. 1. Administrative Reconstitution — a proceeding in rem; once issue,
 Unfortunately, Gocheco failed to comply with the order. Hence, anybody who has a claim or interest has 2 years to inform the court if his
the oppositors filed an ex-parte motion to dismiss. The trial claim; such claim was not carried over the reconstituted title issued
court however required Gocheco to make his reply as to why the 2. Ex Parte reconstitution — a proceeding not in rem; court has discretion
petition should not be dismissed. Gocheco manifested that he will be whether or not it is proper to re-annotate a previously existing annotation
submitting evidence but subsequently the court dismissed the at the back of title
petition.
WHERE TO FILE PETITION; CONTENTS
Issues: Shall be filed by the registered owner, his assigns, or any person having
 Whether or not publication is necessary for the issuance of a interest in the property with the proper RTC where the same is based on
new owner’s duplicate copy of title. sources enumerated earlier
 Whether or not appointment of a legal representative of the Contents shall be as followed—
estate and filing of testate or intestate proceedings is 1. That the owner’s duplicate had been lost or destroyed
necessary for the issuance of a new owner’s duplicate copy of 2. That no co-owner’s, mortgagee’s, lessee’s, duplicate had been issued
title. or, if any had been issued, the same had been lost or destroyed
3. The location, area and boundaries of the property
Ruling: 4. The nature and description of the buildings or improvements, if any,
which don’t belong to the owner of the land, and the names and addresses
On both issues. of the owners of such buildings or improvements
 No. Neither publication nor filing of testate or intestate 5. The names and addresses of the occupants or persons in possession of
proceedings is necessary for the issuance of a new owner’s the property, of the owners of the adjoining properties and all persons who
duplicate certificate of title. may have any interest in the property
 In this case, the petition was only for the issuance of an owner’s 6. A detailed description of the encumbrances if any, affecting the property
duplicate copy of a title that was lost. 7. A statement that no deeds or other instruments affecting the property
 The petition was not one for reconstitution which would have been presented for registration, or if there be any, the registration
require publication. Neither is the petition about the thereof hasn’t been accomplished
distribution of the decedent’s estate. Hence, there is no
necessity for the order coming from the trial court. REQUIREMENTS OF NOTICE BY PUBLICATION, POSTING AND
 Moreover, with the existence of a complete record in the Register of MAILING
Deeds, the petition should have been given due course as only the 1. To be published twice, at the expense of the petitioner, in successive
owner’s duplicate copy is to be issued to the petitioner who is a person issues of the Official Gazette
in interest as legal heir of the registered owner. 2. To be posted on the main entrance of the provincial building and of the
municipal building of the municipality or city in which the land is situated
On oppositor’s claim. 3. Copy of the notice to be sent by registered mail or otherwise, at the
 They should institute a separate, independent, and ordinary civil expense of the petitioner, to every person named therein whose address
action for their claim of ownership or possession of the property. They is known, within 30 days prior the date of hearing. The jurisdiction of the
have no personality to intervene based on their grounds for court is hedged in the forewalls of the petition and the published notice of
intervention. hearing which define the subject matter of the petition.
Fallo: COMPLIANCE WITH JURISDICTIONAL REQUIREMENTS IS

 IN VIEW HEREOF, the order of June 29, 1957 of the Trial Court, MANDATORY
appealed from, is set aside, and another entered, directing the • The court doesn’t acquire jurisdiction to hear the petition
Register of Deeds of Zamboanga del Sur, to issue to the petitioner a • It is not enough that there is publication in the OG only for there is a
new owner's duplicate copy which was lost. With costs on the posting requirement also. Failure to comply will nullify the proceedings.
oppositors-appellees.
RECONSTITUTED TITLES: EXTRAJUDICIAL -VS- JUDICIAL
Reconstitution of Lost/Destroyed Original Torrens Title (Sec. Reconstituted titles shall have the same validity and legal effects as to the
110) originals thereof unless the reconstitution was made extrajudicially. In
contrast to the judicial reconstitution of a lost certificate of title which is in
Section 110. Reconstitution of lost or destroyed original of Torrens rem, the administrative reconstitution is essentially ex-parte and without
title. Original copies of certificates of title lost or destroyed in the offices notice. The reconstituted certificates of title do not share the same
of Register of Deeds as well as liens and encumbrances affecting the lands indefeasible character of the original certificates of title for the following
covered by such titles shall be reconstituted judicially in accordance with reason: The nature of a reconstituted Transfer Certificate of Title of a
the procedure prescribed in Republic Act No. 26 insofar as not inconsistent registered land is similar to that of a second Owner’s Duplicate Transfer
with this Decree. The procedure relative to administrative reconstitution of Certificate of Title. Both are issued, after the proper proceedings, on the
lost or destroyed certificate prescribed in said Act is hereby abrogated. representation of the registered owner that the original of the said TCT,
Notice of all hearings of the petition for judicial reconstitution shall be given respectively, was lost and could not be located or found despite diligent
to the Register of Deeds of the place where the land is situated and to the efforts exerted for that purpose. Both, therefore, are subsequent copies of
Commissioner of Land Registration. No order or judgment ordering the the originals thereof. A cursory examination of these subsequent copies
reconstitution of a certificate of title shall become final until the lapse of would show that they are not the originals. Anyone dealing with such
thirty days from receipt by the Register of Deeds and by the Commissioner copies are put on notice of such fact and thus warned to be extra careful.
of Land Registration of a notice of such order or judgment without any (Barstowe Phils. Corp. vs. Republic 519 SCRA 238)
appeal having been filed by any of such officials.
Note: PD 1529 discontinued administrative reconstitution which was
Note: The reconstitution of a certificate of title denotes the restoration in provided under RA 26. However, administrative reconstitution was
its original form and condition of a lost or destroyed original or transfer reinstated by RA 6732 to address the problem of the Quezon City fire. This
certificate of title on file in the office of the RD. does not apply only to the Quezon City incident, but also where at least
10% of the records of a city is destroyed, or at least 500 titles, the
Purpose: To have the title reproduced in exactly the same way it was at administrator will declare that the city/province where the RD is located
the time of its loss or destruction. may avail of RA 6732.
PROOF REQUIRED FOR RECONSTITUTION Saint Mary Crusade v. Riel

a. That the certificate of title had been lost or destroyed;
Facts:
Prepared by: Gas

 Petitioner claimed in its petition for reconstitution that the
original copy of OCT No. 1609 had been burnt and lost in the fire  Sec. 2. Original certificates of title shall be reconstituted from
that gutted the Quezon City Register of Deeds in the late 80's. Initially, such of the sources hereunder enumerated as may be available, in
respondent Judge gave due course to the petition, but after the the following order:
preliminary hearing, he dismissed the petition for a) The owner's duplicate of the certificate of title;
reconstitution. b) The co-owners’, mortgagee's, or lessee's duplicate of the
 The petitioner moved for reconsideration of the dismissal, attaching certificate of title;
the following documents to support its petition for reconstitution, c) A certified copy of the certificate of title, previously issued by
namely: (1) the copy of the original application for registration the register of deeds or by a legal custodian thereof;
dated January 27, 1955; (2) the notice of initial hearing dated June d) An authenticated copy of the decree of registration or patent, as
23, 1955; (3) the letter of transmittal to the Court of First Instance the case may be, pursuant to which the original certificate of
in Quezon City; (4) the copy of the Spanish Testimonial Title No. title was issued;
3261054 dated March 25, 1977 in the name of Eladio Tiburcio; (5) the e) A document, on file in the registry of deeds, by which the
copy of Tax Assessment No. 14238; and (6) the approved Plan property, the description of which is given in said document, is
SWD-37457. mortgaged, leased or encumbered, or an authenticated copy of
 On February 5, 2007, the RTC denied the motion for said document showing that its original had been registered; and
reconsideration for lack of any cogent or justifiable ground to f) Any other document which, in the judgment of the court, is
reconsider. sufficient and proper basis for reconstituting the lost or
 Hence, petitioner came directly to the Court alleging that destroyed certificate of title.
respondent Judge had "unfairly abused his discretion and
unlawfully neglected the performance of an act”. He filed for certiorari Sec. 3. Transfer certificates of title shall be reconstituted from such
and mandamus. of the sources hereunder enumerated as may be available, in the following
order:
Comment of Respondent Judge a) The owner's duplicate of the certificate of title; (basically
 On May 23, 2007, Respondent Judge justified the dismissal of the the same as the previous one).
petition for reconstitution by citing the opposition by the OSG and
the UP, as well as the recommendation of the Land Registration PETITIONER RESORTED TO THE WRONG REMEDY
Authority (LRA).
 He averred that petitioner did not present its Torrens title to be  With the questioned orders of the RTC having finally disposed of the
reconstituted; that the petitioner’s claim was doubtful given the application for judicial reconstitution, nothing more was left for the
magnitude of 4,304,623 square meters as the land area involved; and RTC to do in the case. Therefore, the correct recourse for the petitioner
that the UP's ownership of the portion of land covered by was to appeal to the Court of Appeals by notice of appeal within 15
petitioner's claim had long been settled by the Court in a long line days from notice of the denial of its motion for reconsideration.
of cases. (this is true).  By allowing the period of appeal to elapse without taking
action, it squandered its right to appeal.
Comment of OSG and UP  Its present resort to certiorari is impermissible, for an extraordinary
(Note: UP sought to intervene on November 13, 2007 and was granted by remedy like certiorari cannot be a substitute for a lost appeal.
the Court).  Moreover, there being no special, important or compelling reason, the
 On July 19, 2007, OSG (and UP) argued that the petitioner had availed petitioner thereby violated the observance of the hierarchy of courts,
itself of the wrong remedies by directly coming to the Court by petition warranting the dismissal of the petition for certiorari.
for certiorari and mandamus; it alleged that the petitioner failed to
observe the doctrine of hierarchy of courts. NO GAD
 Moreover, petitioner had no factual and legal bases for  In so doing, respondent Judge actually heeded the clear warnings to
reconstitution due to its failure to prove the existence and the lower courts and the Law Profession in general against mounting
validity of the certificate of title sought to be reconstituted, in or abetting any attack against such ownership.
addition to the ownership of the land covered by the petition for  One such warning was that in Cañero v. University of the
reconstitution. Philippines, as follows:
 Allegedly, petitioner’s claim over the land was derived from the Deed  We strongly admonish courts and unscrupulous lawyers to stop
of Assignment executed by one Marcelino Tiburcio – the same entertaining spurious cases seeking further to assail respondent UP’s
person whose claim had long been settled and disposed of in title. These cases open the dissolute avenues of graft to unscrupulous
Tiburcio v. People’s Homesite and Housing Corporation and land-grabbers who prey like vultures upon the campus of respondent
University of the Philippines (106 Phil. 477), which vested title in UP. By such actions, they wittingly or unwittingly aid the hucksters
the UP, and in Cañero v. University of the Philippines (437 SCRA 630); who want to earn a quick buck by misleading the gullible to buy the
 Finally, it concluded that Deed of Transfer and Conveyance dated Philippine counterpart of the proverbial London Bridge. It is well past
November 26, 1925 executed by Tiburcio in favor of St. Mary time for courts and lawyers to cease wasting their time and
Village Association, Inc. was not a basis for the judicial resources on these worthless causes and take judicial notice of
reconstitution of title accepted under Section 2 of Republic Act the fact that respondent UP’s title had already been validated
No. 26. countless times by this Court. Any ruling deviating from such
doctrine is to be viewed as a deliberate intent to sabotage the rule of
Issues: law and will no longer be countenanced.
 Whether or not petitioner’s motion for certiorari and
mandamus should be dismissed.
 Whether or not petitioner has complied with the procedures Republic v. Sanchez
for reconstitution of lost title.
Facts:
Ruling:  On 28 May 1996, respondents filed a petition ("LRC Case No. Q-96-
8296") in the trial court to reconstitute the original of TCT No.
THE SUBJECT LOT SOUGHT TO BE RECONSTITUTED BELONGS TO 252708. Respondents claimed that TCT No. 252708 was issued in the
UP name of respondent Marina.
 Respondents alleged that the original of TCT No. 252708 was among
 The petition for certiorari and mandamus did not show how the documents destroyed by the fire which razed the Office of the
respondent Judge could have been guilty of lacking or Register of Deeds, Quezon City in June 1988. Respondents sought
exceeding his jurisdiction, or could have gravely abused his reconstitution under Section 3(a) of RA 26 based on Marina's
discretion amounting to lack or excess of jurisdiction. duplicate title.
 Under Section 12 21 of Republic Act No. 26, the law on the judicial  The Solicitor General filed his Comment to the petition, noting that
reconstitution of a Torrens title, the Regional Trial Court (as the since the petition is based on Section 3(a) of RA 26, the trial court
successor of the Court of First Instance) had the original and exclusive should defer acting on the petition until the Land Registration
jurisdiction to act on the petition for judicial reconstitution of title. Authority (LRA) has submitted its Report on the petition as required
 Hence, the RTC neither lacked nor exceeded its authority in under LRA Circular No. 35.
acting on and dismissing the petition. Nor did respondent Judge  In response to the Solicitor General's Comment, respondents
gravely abuse his discretion amounting to lack or excess of submitted a First Report signed by Bustos, Chief, Reconstitution
jurisdiction considering that the petition for reconstitution Division, LRA and endorsed to the trial court in a letter signed by
involved land already registered in the name of the UP, as Oriel, Chief, Docket Division, LRA. Apart from the First Report.
confirmed by the LRA. Instead, it would have been contrary to  (RTC RULING) [October 1996 Order] The trial court granted
law had respondent Judge dealt with and granted the petition reconstitution and ordered TCT No. 252708 reconstituted finding that
for judicial reconstitution of title of the petitioner. TCT No. 252708 "does not appear to overlap previously
 The land covered by the petition for judicial reconstitution related to plotted/decreed properties in the area (later, it turns out that it
the same area that formed the UP campus. The UP's registered overlapped).
ownership of the land comprising its campus has long been  In a letter, LRA’s Oriel submitted to the trial court Second
settled under the law. Report, informing the trial court that the First Report was fake
 Accordingly, the dismissal of the petition for judicial reconstitution by and recommended that the trial court set aside its October
respondent Judge only safeguarded the UP's registered ownership. 1996 decision granting the reconstitution of TCT 252708.
 Petitioner, however, filed a Manifestation and Motion to set aside the
PETITIONER DID NOT PRESENT THE DUPLICATE OR CERTIFIED 28 October 1996 Order. Petitioner contended that respondents'
COPY OF THE ORIGINAL CERTIFICATE OF TITLE petition should be considered as having been filed under Section 3(f)
of RA 26, that is, based on "any other document."
 The petitioner did not present the duplicate or certified copy of  Petitioner pointed out that a petition for reconstitution of lost
OCT No. 1609 hence it disobeyed Section 2 and Section 3 of or destroyed titles based on Section 3(f) should not only be
Republic Act No. 26, the provisions that expressly listed the published and posted but also served on, among others, the
acceptable bases for judicial reconstitution of an existing Torrens title, owners of the adjoining properties. For non-compliance with this
to wit
Prepared by: Gas

requirement, the trial court did not acquire jurisdiction over LRC Case (e) A document, on file in the registry of deeds, by which the property
No. Q-96-8296. the description of which is given in said documents, is mortgaged,
 [July 1998 Resolution] The trial court set aside the 28 October leased or encumbered, or an authenticated copy of said document
1996 Order and dismissed LRC Case No. Q-96-8296 and held: showing that its original had been registered; and
“Records reveal that TCT No. 252708, the title to be reconstituted, (f) Any other document which, in the judgment of the court, is
overlaps TCT Nos. 187040 and 187042 of Uy and Zalamea. sufficient and proper basis for reconstituting the lost or destroyed
Petitioners' design of having their title reconstituted, certificate of title.
notwithstanding the fact that the same is covered in two other
titles, eludes the comprehension of this Court.  In the present case, the source of the Petition for the
 This Court is of the view that the failure to notify the registered reconstitution of title was petitioner's duplicate copies of the
owners of TCT Nos. 187040 and 187042 of the Reconstitution two TCTs mentioned in Section 3(a). Clearly, the Petition is
proceeding proved to be a mistake. governed, not by Sections 12 and 13, but by Section 10 of RA
 Section 13, RA 26 provides that: “The Court shall likewise cause 26.
a copy of the notice to be sent, by registered mail or otherwise,
at the expense of the petitioner, to every person named SEC. 10. Nothing hereinabove provided shall prevent any
therein whose address is known, at least thirty days prior to registered owner or person in interest from filing the petition
the date of the hearing. Said notice shall state among other mentioned in Section Five of this Act directly with the proper
things, the number of the lost or destroyed certificate of title, Court of First Instance, based on sources enumerated in
if known, the name of the registered owner, the name[s] of Section 2(a), 2(b), 3(a), 3(b), and/or 4(a) of this Act. Provided,
the occupants or persons in possession of the property, the however, That the Court shall cause a notice of the petition, before
owner[s] of the adjoining properties and all other interested hearing and granting the same, to be published in the manner stated
parties, the location, area and boundaries of the property, and the in Section Nine hereof: And provided, further, That certificates of title
date on which all persons having any interest therein, must appear reconstituted pursuant to this section shall not be subject to the
and file their claim o[r] objection to the petition. The petitioner shall, encumbrance referred to in Section Seven of this Act.
at the hearing, submit proof of the publication, posting and service of
the notice as directed by the court.  Nothing in this provision requires that notices be sent to
 Petitioners' failure to comply with this provision is a fatal defect for owners of adjoining lots. Verily, that requirement is found in
the same is mandatory and jurisdictional. Section 13, which does not apply to petitions based on an
 (CA RULING) The Court of Appeals granted respondents' petition, existing owner's duplicate TCT.
set aside the trial court's 17 July 1998 and 4 January 1999  However, contrary to respondents' claim, Puzon finds no
Resolutions, and reinstated the 28 October 1996 Order ruling “until application here. No report from a pertinent government agency
the trial court declares TCT No. 252708 to be void and orders its challenging the authenticity of Puzon's duplicate certificates of title
cancellation, we cannot but recognize the validity of the same.” was presented in Puzon. Thus, when Branch 80 granted
 Petitioner reiterates its claim that the trial court did not reconstitution, Puzon's duplicate transfer certificates of title
acquire jurisdiction over LRC Case No. Q-96-8296 for lack of remained unchallenged.
actual notice to all interested parties as required under Section  In contrast, the trial court in the present case was misled into
13 in relation to Section 12 of RA 26. Respondents countered that the treating LRC Case No. Q-96-8296 as having been filed under
actual notice requirement in Section 13 does not apply to LRC Case Section 3(a) based on Marina's purported duplicate title.
No. Q-96-8296 because that case was based on Marina's duplicate  Thus, the trial court followed Section 10 in connection with Section 9
copy of TCT No. 252708. of RA 26 to publicize LRC Case No. Q-96-8296. Relying on the First
Report's finding that TCT No. 252708 "does not appear to overlap
Issue: previously plotted/decreed properties in the area," the trial court
Whether or not the trial court acquired jurisdiction over LRC Case granted reconstitution.
No. Q-96-8296.  However, petitioner later informed the trial court of the First Report's
spuriousness, the serious doubts on TCT No. 252708's authenticity,
Ruling: and the existence of two other titles that overlapped Lot No. 1. After
hearing the parties, the trial court dismissed LRC Case No. Q-96-8296
THE EXEMPTION FROM NON-REQUIREMENT OF SERVICE OF for lack of jurisdiction as all interested parties were not actually
NOTICE IS NON-APPLICABLE BECAUSE THE TITLE IN THE CASE AT notified of the petition as required under Section 13 in relation to
BAR IS FICTITIOUS Section 12 of RA 26.
 Respondents are correct in saying that the service of notice of the THE RECONSTITUTION OF A FAKE AND FICTITIOUS
petition for reconstitution filed under RA 26 to the occupants of the DUPLICATE TITLE FALLS UNDER SEC. 3 (F) AND NOT 3(A);
property, owners of the adjoining properties, and all persons who may THUS, IT REQUIRES THE REQUIREMENT OF SERVICE OF
have any interest in the property is not required if the petition is NOTICE
based on the owner's duplicate certificate of title or on that of
the co-owner's, mortgagee's, or lessee's.  (Director of Lands v. CA) The instant petition for judicial
 (Puzon v. Sta. Lucia Realty and Development, Inc.) This involves reconstitution falls squarely under Section 3(f), Republic Act No. 26,
a petition filed for the reconstitution of the original of two Torrens because the Director of Lands claims that the respondent's duplicate
certificates of title based on Puzon's duplicate certificates of title. of the Certificate of Title No. T-12/79 or TCT No. 42449 are fake and
Serving a notice is not required if the petition is based on the owner’s fictitious.”
duplicate certificate of title or of the co-owner’s, etc.  Consequently, we applied Sections 12 and 13 of RA 26 and held that
 RA 26 Sec. 12: x x x The requirements under Sections 12 and 13 do for non-compliance with these provisions, the trial court did not
not apply to all petitions for judicial reconstitution, but only to those acquire jurisdiction over the petition for reconstitution.
based on any of the sources specified in Section 12, that is,  For petitions based on sources enumerated in Sections 2(c), 2(d),
"sources enumerated in Section 2(c), 2(d), 2(e), 2(f), 3(c), 2(e), 2(f), 3(c), 3(d), 3(e) and 3(f), Section 13 adds another
3(d), 3(e), and/or 3(f) of this Act. requirement: that the notice be mailed to occupants, owners
of adjoining lots, and all other persons who may have an
SEC. 2. Original certificates of title shall be reconstituted from such interest in the property. To repeat, mailing the notice is not
of the sources hereunder enumerated as may be available, in the required for a petition based on Sections 2(a), 2(b), 3(a), 3(b) and
following order: 4(a), as in the present case.
(a) The owner's duplicate of the certificate of title;  It is Section 13 in relation to Section 12 of RA 26 which applies
(b) The co-owner's, mortgagee's, or lessee's duplicate of the to LRC Case No. Q-96-8296. Hence, in addition to its posting
certificate of title; and publication, the notice of hearing of LRC Case No. Q-96-
(c) A certified copy of the certificate of title, previously issued by the 8296 should also have been served through mail on the
register of deeds or by a legal custodian thereof; owners of the adjoining properties and all persons who may
(d) An authenticated copy of the decree of registration or patent, as have any interest in the property.
the case may be, pursuant to which the original certificate of title was  The records show that neither the adjoining owners nor the
issued; other interested parties, Uy and Zalamea, were issued, were
(e) A document, on file in the registry of deeds, by which the notified of respondents' petition in LRC Case No. Q-96-8296.
property, the description of which is given in said document, is
mortgaged, leased or encumbered, or an authenticated copy of said ACTUAL NOTICE REQUIREMENT IS JURISDICTIONAL
document showing that its original had been registered; and
(f) Any other document which, in the judgment of the court, is  These requirements and procedure are mandatory. The petition
sufficient and proper basis for reconstituting the lost or destroyed for reconstitution must allege the jurisdictional facts; the notice of
certificate of title. hearing must also be published and posted in particular places and
the same sent to specified persons.”
SEC. 3. Transfer certificates of title shall be reconstituted from such  For non-compliance with the actual notice requirement in
of the sources hereunder enumerated as may be available, in the Section 13 in relation to Section 12 of RA 26, the trial court did
following order: not acquire jurisdiction over LRC Case No. Q-96-8296. The
proceedings in that case were thus a nullity and the 28 October 1996
(a) The owner's duplicate of the certificate of title; Order was void.
(b) The co-owner's, mortgagee's or lessee's duplicate of the
certificate of title; Summary:
(c) A certified copy of the certificate of title, previously issued by the (D&D Summary) If reconstitution of title is based on documents under:
register of deeds or by a legal custodian thereof; Section 3(a, b) = posting and publication only
(d) The deed of transfer or other document on file in the registry of Section 2(c, d, e, f) 3(c, d, e, f) = posting and publication + notice by
deeds, containing the description of the property, or an authenticated mailing of the (reconstitution) case
copy thereof, showing that its original had been registered, and
pursuant to which the lost or destroyed transfer certificate of title was
issued; Heirs of Venturanza v. Republic
Prepared by: Gas

which constitute Republic's cause of action against the herein
Facts: petitioners, were ever raised, much less, decided by the CA in CA-
 The title in question, TCT No. 2574, was issued sometime in 1959 G.R. No. 20681-R.
in the name of Gregorio Venturanza. The memorandum of  Petitioners also claim that they are protected by law
registration shows that TCT No. 2574 was derived from TCT No. RT- considering that they were buyers in good faith. Again, this
40 (140), which is a reconstituted title issued to one Florencio assertion is without basis considering that Mora's
Mora who sold the property therein described to Gregorio reconstituted TCT No. RT-40 (140), from where petitioners'
Venturanza in 1956 for P107,730.00. TCT No. 2574 was derived, is void.
 The same memorandum of registration, however, does not  The only way by which Mora could have acquired ownership over the
show when the land covered by TCT No. 2574 was originally subject parcels of land and validly transfer that ownership to the
registered and the other data were merely noted as (NA). petitioners was for Mora to apply for their registration in his own
 In 1964, Gregorio Venturanza and the then Abaca Development name.
Board entered into an agreement for purchase and sale of the
property covered by TCT No. 2574. The government's negotiation Republic v. Lorenzo
committee assigned a deputy clerk of the Land Registration
Commission (LRC) to verify the true copies of TCT No. 2574 in the Facts:
name of Gregorio Venturanza.  In seeking the reconstitution of OCT No. 3980, respondents averred
 It was found out that Venturanzas' TCT No. 2574, was derived before the trial court:
from TCT No. RT-40 (140) in the name of one Florencio Mora
(Mora). In turn, TCT No. RT-40 (140) appears to have been 3. That during the lifetime of Pedro Fontanilla and herein petitioner
reconstituted from TCT No. 140 which was issued to one Sebastian Concepcion Lorenzo, husband and wife, respectively, they acquired
Moll on June 7, 1928. TCT No. 140, on the other hand, appears to be a parcel of residential land;
a transfer from Land Registration Case (LRC) No. 3480 issued to one 4. That subject parcel of land is identical to Lot 18 of Echague Cadastre
Casimiro Natividad. 210, covered by and embraced under ORIGINAL CERTIFICATE OF
 In the report submitted by the LRC deputy clerk, the latter TITLE NO. 3980 of the Land Records of Isabela, in the name of Antonia
made a finding that the Venturanzas' TCT No. 2574, from TCT Pascua as her paraphernal property and being the mother of Pedro
No. RT-40 (140) which was, in turn, derived from TCT No. 140, Fontanilla;
covers only a parcel of land with an area of 451 square meters 5. That because of the death of Pedro Fontanilla the lot as
and NOT 23,944,635 square meters or 2,394 hectares which covered by the aforesaid title was settled and adjudicated
practically comprise the entire Municipality of Buhi. among the herein petitioners;
 The Republic of the Philippines, through the OSG, filed a complaint 6. That the OWNER'S DUPLICATE COPY OF OCT NO. 3980 was
for the Cancellation of Transfer Certificate of Title No. 2574 handed and delivered unto the spouses Pedro Fontanilla and
and the Reversion of the Land. Concepcion Lorenzo which they have been keeping only to find
 (RTC & CA RULING) Resolved the suit in favor of the Republic. out thereafter that it was eaten by white ants (Anay);
The trial court principally anchored its judgment on the ground that 7. That the original and office file copy of said OCT NO. 3980 kept and
the reconstituted title issued in the name of Florencio Mora to be on file in the Registry of Deeds of Isabela is not now
could have been fraudulently secured, hence, does not legally available, utmost same was included burned and lost beyond
exist. The court further ruled that since the reconstituted title issued recovery when the office was razed by fire sometime in 1976, a
to Florencio Mora is a nullity, then the order for its reconstitution did certification to this effect as issued by the office is hereto marked as
not attain finality and therefore may be attacked anytime. ANNEX "D";
 The Venturanzas went on appeal to the CA arguing that Mora's 8. That for taxation purposes, the lot as covered by OCT NO. 3980,
reconstituted title from where their TCT No. 2574 was derived is still in the name of Antonia Pascua for Lot 18, Cad. 210, with an
already indefeasible; that they are protected by law as buyers in good assessed value of P16,920.00;
faith; and Republic's action for the cancellation of TCT No. 2574 and 9. That no mortgagee's and/or lessee's co-owner's copy to the
the reversion of the land described therein to the mass of public subject OCT NO. 3980 was ever issued, and likewise no related
domain was already barred by the decision of the CA in Florencio Mora documents affecting the land covered thereby is presented and
v. Venancio Infante which granted the petition for reconstitution of pending for registration in favor of any person whomsoever, and
Mora's TCT No. RT-40 (140). CA affirmed the trial court’s ruling. henceforth, it is free from lien and encumbrance;
xxx xxx xxx
Issue: 11. That in support for the reconstitution of [OCT] No. 3980, the
Whether or not the CA erred in affirming the cancellation of TCT following documents which may constitute as source or basis for the
No. 2574 purpose are herewith submitted:
(a) S[E]PIA PLAN with Blue Prints . . .;
Ruling: (b) Certified technical description of Lot 18, Cad. 210 . . .;
(c) Certification by LRA as to the non-availability of a copy of DECREE
A RECONSTITUTED TITLE DERIVED FROM A FRAUDULENT TITLE NO. 650254
DOES NOT ATTAIN INDEFEASIBILITY
(RTC & CA RULING)
 Petitioners maintain that under Section 112 of Act No. 496 (Land  The trial court granted respondents' petition and directed the
Registration Act), Mora's reconstituted TCT No. RT-40 (140) is Register of Deeds of Isabela to reconstitute OCT No. 3980 in the name
already indefeasible the same having attained finality one (1) year of Antonia Pascua on the basis of the deed of sale, the technical
after the CA granted its reconstitution. description and the sketch plans, and to issue another owner's
 Petitioners are wrong. Clearly, the provisions relied upon refer duplicate copy of the said Torrens certificate of title.
to original decrees of registration and not to orders of  Petitioner Republic of the Philippines, through the Office of the
reconstitution. Solicitor General, appealed the ruling to the Court of Appeals
 As it is, petitioners cannot even seek refuge in the Land Registration arguing that the trial court erred in granting respondents' petition for
Act because the land covered by TCT No. 2574 had never been reconstitution of Torrens title since they failed to present
brought within the operation of said law. substantial proof that the purported original certificate of title
was valid and existing at the time of its alleged loss or destruction,
THE TCT WAS NOT REGISTERED; THEREFORE, NO COURT COULD
and that they failed to present sufficient basis or source for
ACQUIRE JURISDICTION TO ORDER RECONSTITUTION OF MORA’S
reconstitution. CA affirmed the trial court ruling.
TCT
 The evidence shows that TCT No. 2574, the title in question, derived (OSG CONTENTION)
its existence from RT-40 (140) in the name of Florencio Mora which  OSG argues that the alleged loss or destruction of the owner's
was a reconstituted title based on TCT No. 140 allegedly obtained by duplicate copy of OCT No. 3980 has no evidentiary basis and that
Florencio Mora during the Japanese occupation. there is no sufficient basis for the reconstitution of OCT No.
 The records of the Register of Deeds of Camarines Sur, however, do 3980.
not show how the land covered by TCT No. 140 supposedly in  OSG likewise maintains that the findings of fact of the Court of
the name of Florencio Mora was registered. Appeals are not supported by the evidence on record.
 Neither is there a decree number, when said decree was entered, the  Lastly, OSG insists that, contrary to respondents' assertion, the
OCT number or LRC Record Number. government of the Republic of the Philippines is not estopped by the
mistakes, negligence or omission of its agents.
NO RES JUDICATA; NO PROTECTION FOR A BUYER IN GOOD
FAITH IF THEY BOUGHT A VOID TITLE (RESPONDENT ARGUMENTS)
 Respondents maintain that they have complied with Section 2 of
 The judgment in CA-G.R. No. 20681-R did not operate as res
Republic Act No. 26 considering that there was no opposition from
judicata which would bar the Republic's action because there
the Office of the Solicitor General (OSG); that the OSG is guilty of
was no identity of cause of action between CA-G.R. No. 20681-R
estoppel; that there was a valid basis for reconstitution of OCT No.
and the instant case.
 The issue in CA-G.R. No. 20681-R was whether or not Mora's evidence 3980;
in Special Proceedings No. 674 and the procedures adopted by  that there was compliance with jurisdictional requirements; that both
him for the reconstitution of certificate of title alleged to have the original file copy and the owner's copy of the subject OCT for
been lost or destroyed were in conformity with the provisions reconstitution were lost or destroyed beyond discovery; and that
of Republic Act No. 26. questions of fact are not subject to review by this Court.
 The questions of ownership and whether or not the property
or portion thereof was registrable, being a timberland, were Issues:
never put at issue in CA-G.R. No. 20681-R.  Whether or not the reconstitution of OCT No. 3980 was in
 Neither the non-existence of the original title from which Mora's TCT accordance with the pertinent law and jurisprudence on the
No. RT-40 (140) and petitioners' TCT No. 2574 were derived, nor the matter.
non-registrability of the timberland included in the area in question
Prepared by: Gas

Ruling:  From the foregoing, it is apparent that the conclusion of the Court of
 The relevant law that governs the reconstitution of a lost or Appeals that "the enumeration of the preferential documents to be
destroyed Torrens certificate of title is Republic Act No. 26. produced as provided under Section 2 of Republic Act 26 had been
Section 2 of said statute enumerates the following as valid sources substantially complied with" had no foundation based on the evidence
for judicial reconstitution of title (pls refer to the previous pages kay on record.
luod na copy balik atong taas)
THE ABSENCE OF ANY DOCUMENT MENTIONING THE NUMBER OF
X X X (f) Any other document which, in the judgment of the court, THE CERTIFICATE OF TITLE AND DATE WHEN IT WAS ISSUED
is sufficient and proper basis for reconstituting the lost or DOES NOT WARRANT THE GRANTING OF THE PETITION FOR
destroyed certificate of title. RECONSTITUTION
 As borne out by the records of this case, respondents were unable to  Likewise, the deed of sale purportedly between Antonia Pascua,
present any of the documents mentioned in paragraphs (a) to (e) as seller, and Pedro Fontanilla, as buyer, which involves OCT
above. Thus, the only documentary evidence the respondents No. 3980 cannot be relied upon as basis for reconstitution of
were able to present as possible sources for the reconstitution Torrens certificate of title.
of OCT No. 3980 are those that they believed to fall under the class  An examination of the deed of sale would reveal that the number
of "any other document" described in paragraph (f). of the OCT allegedly covering the subject parcel of land is
clearly indicated, however, the date when said OCT was issued
DOCUMENTS REFERRED IN SEC. 2(F) MAY BE RESORTED ONLY IN does not appear in the document.
ABSENCE OF THE PRECEDING DOCUMENTS IN THE LIST AND WHEN  This circumstance is fatal to respondents' cause as we have
THERE IS IN EFFORT TO FIND THEM IF THEY ARE UNABLE TO BE reiterated in Republic v. El Gobierno de las Islas Filipinas that the
PRESENTED absence of any document, private or official, mentioning the
number of the certificate of title and the date when the
 As correctly pointed out by petitioner, we had emphasized in
certificate of title was issued, does not warrant the granting
Republic v. Holazo that the term "any other document" in
of a petition for reconstitution.
paragraph (f) refers to reliable documents of the kind described
in the preceding enumerations and that the documents referred Estoppel in Action for Cancellation of Title
to in Section 2 (f) may be resorted to only in the absence of the
preceding documents in the list. The general rule is that the State cannot be put in estoppel by the mistakes
 Therefore, the party praying for the reconstitution of a title or errors of its officials or agents. However, like all general rules, this is
must show that he had, in fact, sought to secure such also subject to exceptions, viz:
documents and failed to find them before presentation of
"other documents" as evidence in substitution is allowed. “Estoppel against the public are little favored. They should not be invoked
 (Republic v. Holazo) When Rep. Act No. 26, Section 2(f), or 3(f) for except in rare and unusual circumstances and may not be invoked where
that matter, speaks of "any other document," it must refer to similar they would operate to defeat the effective operation of a policy adopted to
documents previously enumerated therein or documents ejusdem protect the public. They must be applied with circumspection and should
be applied only in those special cases where the interests of justice clearly
generis as the documents earlier referred to. The documents alluded
require it. Nevertheless, the government must not be allowed to deal
to in Section 3(f) must be resorted to in the absence of those
dishonorably or capriciously with its citizens, and must not play an ignoble
preceding in order. If the petitioner for reconstitution fails to part or do a shabby thing; and subject to limitations . . ., the doctrine of
show that he had, in fact, sought to secure such prior equitable estoppel may be invoked against public authorities as well as
documents (except with respect to the owner's duplicate copy against private individuals.”
of the title which it claims had been, likewise, destroyed) and
failed to find them, the presentation of the succeeding Judicially reconstituted titles are superior to administratively
documents as substitutionary evidence is proscribed. reconstituted titles.
Reconstituted titles shall have the same validity and legal effect as the
originals thereof unless the reconstitution was made extra-judicially. In
THE REQUIREMENTS OF WHAT MUST BE SHOWN BEFORE A contrast to the judicial reconstitution of a lost certificate of title which is in
RECONSTITUTION OF TITLE CAN BE MADE rem, the administrative reconstitution is essentially ex-parte and without
notice. The reconstituted certificates of title do not share the same
 What should be shown are: indefeasible character of the original certificates of title. It is only fair and
a. that the certificate of title had been lost or destroyed; reasonable to apply the equitable principle of estoppel by laches against
b. that the documents presented by petitioner are sufficient and the government to avoid an injustice to the innocent purchasers for value.
proper to warrant reconstitution of the lost or destroyed
certificate of title; Barstowe Phils. Corp. vs. Republic
c. that the petitioner is the registered owner of the property or had
an interest therein; Facts: BASICALLY INVOLVES CONFLICTING TITLES OF LOTS.
d. that the certificate of title was in force at the time it was lost or FIRST TRANSACTION (SERVANDO TO BPC)
destroyed; and  BPC traces its titles to the subject lots back to Servando with TCTs
e. that the description, area and boundaries of the property are No. 200629 and 200630 over the subject lots. Servando executed
substantially the same and those contained in the lost or a Deed of Absolute Sale of the subject lots to his son Antonio.
destroyed certificate of title.  Despite his prior sale of the subject lots to Antonio, Servando,
 In the case at bar, the respondents were unable to discharge the transferred/conveyed the subject lots to BPC in exchange for
burden of proof prescribed by law and jurisprudence for the subscription of 51% of the capital stock of BPC.
reconstitution of lost or destroyed Torrens certificate of title.  About a year after the death of Servando, Antonio executed another
Deed of Conveyance of the subject lots in favor of BPC in exchange
 First, respondents failed to prove that the owner's duplicate
for subscription of 2,450 shares of its capital stock.
copy of OCT No. 3980 was indeed eaten by termites while in the
 Due to the fire that gutted the Office of the Quezon City
custody of respondent Concepcion Lorenzo and her late husband
Register of Deeds, Antonio sought the administrative
Pedro Fontanilla who, inexplicably, did not execute an affidavit of loss reconstitution of the original copies and owner's duplicate copies of
as required by Section 109 17 of Presidential Decree No. 1529. TCTs No. 200629 and 200630. LRA issued TCTs No. RT-23687 and
 Second, The Certification 18 dated April 23, 2001 issued by the RT-23688.
Register of Deeds of Ilagan, Isabela did not categorically state  Sometime later, TCTs No. RT-23687 and RT-23688 were cancelled
that the original copy of OCT No. 3980, which respondents and in lieu thereof, TCTs No. 30829, 30830, 30831, and 30832 in the
alleged to be on file with said office, was among those name of BPC were issued. BPC then acquired from the Housing
destroyed by the fire that gutted the premises of said office on and Land Use Regulatory Board (HLURB) a permit to develop
December 4, 1976. The document only stated that said office "could the subject lots into a residential subdivision.
not give any information/data involving the existence of  Subsequently, BPC entered into Joint Venture Agreements with other
Original/Transfer Certificate of Title No. Lot No. 18, area 770 sq. m., corporations for the development of the subject lots into a subdivision
called Parthenon Hills.
located at Taggapan, Echague, Isabela."
 Third, a comparison between the aforementioned certification
SECOND TRANSACTION (FPHC TO REPUBLIC)
and the technical description and sketch plan will reveal that
 Meanwhile, according to the Republic, the subject lots were owned
there was a discrepancy in the land area of the lot allegedly by First Philippine Holdings Corporation (FPHC) which sold the
covered by OCT No. 3980. What was reflected on the former was subject lots to the Republic. TCT No. 275443 and 288417 was
a land area of 770 sq. m. while the latter two documents issued in the name of the Republic.
pertained to a land area of 811 sq. m.  Because of the fire which razed the Quezon City Office of the
 Furthermore, respondents were not able to show adequate proof Register of Deeds and destroyed the original copies of TCTs No.
that a Torrens certificate of title was issued covering the 275443 and 288417, the Republic applied for administrative
subject parcel of land or that the same piece of land is what is reconstitution of the same with the LRA.
covered by the allegedly lost or destroyed OCT No. 3980.  It was then that the Republic came to know that another party had
 The Certification dated December 3, 2001 issued by the Land applied for reconstitution of TCTs No. 200629 and 200630 which also
Registration Authority (LRA) which indicates that Decree No. covered the subject lots.
 This prompted the Republic to file a petition for cancellation of title
650254 issued on September 1, 1937 is not among the
against Antonio, Servando, and BPC, docketed as Civil Case No. Q-92-
salvaged decrees on file in the LRA and is presumed to have been
11806.
lost or destroyed as a consequence of World War II does not
support respondents' assertion that OCT No. 3980 did exist (RTC & CA RULING)
prior to its loss or destruction because said document failed to
show a connection between Decree No. 650254 and OCT No. 3980.
Prepared by: Gas

 Judgment declaring BPC and Republic as buyers in good faith THE REPUBLIC CANNOT BE ESTOPPED UNLESS THERE IS AN
but upheld BPC’s rights over the Republic since it was registered INNOCENT PURCHASER FOR VALUE, WHICH BPC IS NOT
earlier. CA ruled in favor of the Republic.
 At this point, it would seem that the Republic does hold better
Issue: titles to the subject lots. Nonetheless, another level of transactions
 Who between BPC and the Republic has a better title over the involving the subject lots was brought by intervenors to the attention
subject lots? of this Court. The Republic is held to be barred by estoppel as to the
lots sold to the intervenors considering that the latter were innocent
Ruling: purchaser for value from BPC.
 The Republic has the better right. BPC, the intervenors Abesamis,  (Republic v. CA) The general rule is that the State cannot be put
Nicolas-Agbulos, spouses Santiago, and Servando’s heirs derived their in estoppel by the mistakes or errors of its officials or agents.
title to the subject lots from Servando’s TCTs No. 200629 and 200630. However, like all general rules, this is also subject to exceptions, viz:
 This Court then is compelled to look into the validity, authenticity, and "Estoppels against the public are little favored. They should not be
existence of these two TCTs. However, there is an absolute dearth invoked except in rare and unusual circumstances, and may not be
of information and proof as to how Servando acquired invoked where they would operate to defeat the effective operation of
ownership and came into possession of the subject lots. a policy adopted to protect the public. They must be applied with
 Relying on the findings of the LRA, it was established that TCTs circumspection and should be applied only in those special cases where
No. 200629 and 200630 were forged and spurious, their the interests of justice clearly require it. Nevertheless, the
reconstitution was also attended with grave irregularities. BPC government must not be allowed to deal dishonorably or
was unable to attack the authenticity and validity of the titles of the capriciously with its citizens, and must not play an ignoble part
Republic to the subject lots, and could only interpose the defense that or do a shabby thing; and subject to limitations x x x the doctrine of
it was a buyer in good faith. equitable estoppel may be invoked against public authorities as well
 It points out that it purchased the subject lots from Servando and as against private individuals.
registered the same, way before the titles of Servando were  Exception: innocent purchasers for value: “Significantly, the other
declared null by the RTC. private respondents bought such "expanded" lots in good faith, relying
 Under Section 55 of the Land Registration Act, as amended by on the clean certificates of St. Jude, which had no notice of any flaw in
Section 53 of Presidential Decree No. 1529, an original owner of them either. It is only fair and reasonable to apply the equitable
registered land may seek the annulment of a transfer thereof principle of estoppel by laches against the government to avoid an
on the ground of fraud. However, such a remedy is without injustice to the innocent purchasers for value.”
prejudice to the rights of any innocent holder for value with a
certificate of title.
 A purchaser in good faith and for value is one who buys the property Republic v. CA and Santos
of another, without notice that some other person has a right to or
interest in such property, and pays a full and fair price for the same at Facts:
the time of such purchase or before he has notice of the claim or  Private respondent St. Jude's Enterprises, Inc. is the registered
interest of some other person in the property. owner of a parcel of land known as Lot 865-B-1 of the subdivision
 It has been consistently ruled that a forged deed can legally be plan (LRC) PSD-52368 and TCT No. 22660. Sometime in 1966,
the root of a valid title when an innocent purchaser for value private respondent subdivided the said lot under subdivision plan
intervenes. A deed of sale executed by an impostor without the (LRC) PSD-55643 and as a result thereof the Register ofDeeds of
authority of the owner of the land sold is a nullity, and registration will Caloocan City cancelled TCT. No. 22660 and in lieu thereof issued
not validate what otherwise is an invalid document. Certificates of Title Nos. 23967 up to 24068.
 However, where the certificate of title was already transferred  The subdivision of Lot 865-B-1 was later found to have
from the name of the true owner to the forger and, while it expanded from its original area of 40,523 square meters to
remained that way, the land was subsequently sold to an 42,044 square meters or an increase of 1,421 square meters. The
innocent purchaser, the vendee had the right to rely upon what expansion in area was confirmed by the Land Registration
appeared in the certificate and, in the absence of anything to excite Commission.
suspicion, was under no obligation to look beyond the certificate and  Thereafter, private respondent sold the subdivided lots to
investigate the title of the vendor appearing on the face of said different buyers including herein private respondents Sps. Catalino
certificate. Santos and Thelma Barreto Santos, Sps. Domingo Calaguian and
 Now the question is whether BPC qualifies as an innocent purchaser Felicidad de Jesus, Virginia Dela Fuente, and Lucy Madaya.
for value which acquired valid titles to the subject lots, despite the fact  On January 29, 1985, then, Solicitor General Estelito Mendoza
that the titles of its predecessor-in-interest were found to be forged filed an action seeking the annulment of Transfer Certificates
and spurious. This Court finds in the negative. of Title of herein private respondents on the ground that said
Certificates of Title were issued on the strength of a null and void
BPC IS NOT A PURCHASER IN GOOD FAITH; ANYONE DEALING subdivision plan (LRC) PSD 55643 which expanded the original area
WITH RECONSTITUTED/DUPLICATE COPIES ARE PUT ON of TCT No. 22660 in the name of St. Jude's Enterprises Inc.
NOTICE OF SUCH FACT AND WARNED TO BE VIGILANT  Virginia dela Fuente and Lucy Madaya were declared in default for
failure to file their respective answers within the reglementary
 BPC cannot really claim that it was a purchaser in good faith period.
which relied upon the face of Servando’s titles. It should be  The Sps. Santos interposed claimed that they acquired the lots
recalled that the Quezon City Register of Deeds caught fire on 11 June in question in good faith from their former owner, defendant
1988. Presumably, the original copies of TCTs were burnt in the said St. Jude. and for value and that the titles issued to the said
fire. Servando’s heirs sought the administrative reconstitution of the defendants were rendered incontrovertible, conclusive and
TCTs. indefeasible after one year from the date of the issuance of the titles
 If BPC bought the subject lots after TCTs were destroyed when by the Register of Deeds of Caloocan City.
the Quezon City Register of Deeds burned down, but before the  On the other hand, St. Jude interposed claimed that the cause
said certificates were reconstituted, then on the face of what of action of plaintiff is barred by prior judgment; that the
titles did BPC rely on before deciding to proceed with the subdivision plan submitted having been approved by the LRC, the
purchase of the subject lots? government is now in estoppel to question the approved subdivision
 There was no showing that there were surviving owner’s plan; and the plaintiff's allegation that the area of the subdivision
duplicate copies of TCTs. Without the original copies and owner’s increased by 1,421 square meters is without any basis in fact and in
duplicate copies of TCTs, BPC had to rely on the reconstituted law.
certificates. Under section 7 of Republic Act No. 26, "Reconstituted  (RTC & CA RULING) The trial court dismissed the complaint.
titles shall have the same validity and legal effect as the originals The trial court concluded that the government was already in estoppel
thereof" unless the reconstitution was made extrajudicially. to question the approved subdivision plan because the said plan was
 In this case, TCTs were reconstituted administratively, hence, presumed to have been subjected to investigation, study and
extrajudicially. In contrast to the judicial reconstitution of a lost verification by the LRC and there was no one to blame for the increase
certificate of title which is in rem, the administrative reconstitution is in the area but the Republic of the Philippines, for having allowed and
essentially ex-parte and without notice. approved the subdivision plan.
 The reconstituted certificates of title do not share the same  The Solicitor General appealed the trial court's decision to the
indefeasible character of the original certificates of title for the Court of Appeals. The appellate court affirmed the decision of the
reason that the nature of a reconstituted Transfer Certificate of Title of trial court.
registered land is similar to that of a second Owner's Duplicate
Transfer Certificate Of Title. Issues:
 Both are issued, after the proper proceedings, on the representation  Whether or not the Republic is barred by estoppel;
of the registered owner that the original of the said TCT or the original  Whether the CA erred when it did not consider the Torrens
of the Owner's Duplicate TCT, respectively, was lost and could not be System merely as a means of registering title to land;
located or found despite diligent efforts exerted for that purpose. Both,  Whether the CA erred when it failed to consider petitioner’s
therefore, are subsequent copies of the originals thereof. complaint was filed before the lower court to preserve the
 A cursory examination of these subsequent copies would show integrity of the Torrens system.
that they are not the originals.
 Anyone dealing with such copies are put on notice of such fact and Ruling:
thus warned to be extra-careful. The fact that the TCTs were
reconstituted should have alerted BPC and its officers to conduct an RTC HAD JURISDICTION OVER PETITIONER; ACTION FOR
inquiry or investigation as might be necessary to acquaint themselves SPECFIC PERFORMANCE IS WITHIN ITS JURISDICTION
with the defects in the titles of Servando.
 This Court cannot declare BPC an innocent purchaser for value,  YES. The general rule is that the State cannot be put in estoppel
and it acquired no better titles to the subject lots than its by the mistakes or errors of its officials or agents. However, like
predecessors-in-interest, Servando and Antonio. all general rules, this is also subject to exception. Estoppels against
the public are little favored.
Prepared by: Gas

 They should not be invoked except in a rare and unusual  First, the real purpose of the Torrens system is to quiet title to
circumstances, and may not be invoked where they would land to put a stop forever to any question as to the legality of
operate to defeat the effective operation of a policy adopted to the title, except claims that were noted in the certificate at the time
protect the public. They must be applied with circumspection and of the registration or that may arise subsequent thereto.
should be applied only in those special cases where the interests of  Second, as we discussed earlier, estoppel by laches now bars
justice clearly require it. petitioner from questioning private respondents' titles to the
 Nevertheless, the government must not be allowed to deal subdivision lots.
dishonorably or capriciously with its citizens, and must not play  Third, it was never proven that St. Jude was a party to the fraud
an ignoble part or do a shabby thing; and subject to limitations, the that led to the increase in the area of the property after its
doctrine of equitable estoppel may be invoked against public subdivision.
authorities as well as against private individuals.  Finally, because petitioner even failed to give sufficient proof of any
 In the case at bar, for nearly twenty years (starting from the issuance error that might have been committed by its agents who had
of St. Jude's titles in 1996 up to the filing of the Complaint in 1985), surveyed the property, the presumption of regularity in the
petitioner failed to correct and recover the alleged increase in performance of their functions must be respected.
the land area of St. Jude.  Otherwise, the integrity of the Torrens system, which petitioner
 Its prolonged inaction strongly militates against its cause, as it is purportedly aims to protect by filing this case, shall forever be
tantamount to laches, which means "the failure or neglect, for an sullied by the ineptitude and inefficiency of land registration
unreasonable and unexplained length of time, to do what which by officials, who are ordinarily presumed to have regularly
exercising due diligence could or should have been done earlier; it is performed their duties.
negligence or omission to assert a right within a reasonable time,
warranting a presumption that the party entitled to assert it either has
abandoned it or declined to assert it." Schedule of Fees, Special Fund
 The Court notes private respondents' argument that, prior to Section 111. Fees payable. Refer to the law
the subdivision, the surveyors erred in the original survey of
the whole tract of land covered by TCT No. 22660, so that less
than the actual land area was indicated on the title. Otherwise, FORMS USED IN LAND REGISTRATION AND
the adjoining owners would have complained upon the partition of the
land in accordance with the LRC-approved subdivision plan. As it is,
CONVEYANCE
Florenci Quintos, the owner of the 9,146 square-meter Quintos Village CHAPTER 12 (SECTION 112)
adjoining the northern potion of St. Jude's property (the portion
allegedly "expanded"), even attested on August 16, 1973 that "there
[was] no overlapping of boundaries as per my approved plan (LRC) Section 112. Forms in conveyancing. The Commissioner of Land
PSD 147766 dated September 8, 1971." Registration shall prepare convenient blank forms as may be necessary to
 None of the other neighboring owners ever complained against help facilitate the proceedings in land registration and shall take charge of
St. Jude or the purchaser of its property. It is clear, therefore, that the printing of land title
there was no actual damage to third persons caused by the resurvey forms. Deeds, conveyances, encumbrances, discharges, powers of
and the subdivision. attorney and other voluntary instruments, whether affecting registered or
unregistered land, executed in accordance with law in the form of public
instruments shall be registerable: Provided, that, every such instrument
BUYERS WERE INNOCENT PURCHASERS FOR VALUE shall be signed by the person or persons executing the same in the
presence of at least two witnesses who shall likewise sign thereon, and
 Significantly, the other private respondents — Spouses Santos, shall acknowledged to be the free act and deed of the person or
Spouses Calaguian, Dela Fuente and Madaya — bought such persons executing the same before a notary public or other public officer
"expanded" lots in good faith, relying on the clean certificates of St. authorized by law to take acknowledgment. Where the instrument so
Jude, which had no notice of any flaw in them either. It is only acknowledged consists of two or more pages including the page whereon
fair and reasonable to apply the equitable principle of estoppel acknowledgment is written, each
by laches against the government to avoid an injustice to the page of the copy which is to be registered in the office of the Register of
innocent purchasers for value. Deeds, or if registration is not contemplated, each page of the copy to be
 Furthermore, it should be stressed that the total area of 40,623 kept by the notary public, except the page where the signatures already
square meters indicated on St. Jude's original title (TCT No. appear at the foot of the
22660) was not an exact area. Such figure was followed by the instrument, shall be signed on the left margin thereof by the person or
phrase "more or less." persons executing the instrument and their witnesses, and all the ages
 This plainly means that the land area indicated was not precise. sealed with the notarial seal, and this fact as well as the number of pages
The discrepancy in the figures could have been caused by the shall be stated in the acknowledgment. Where the instrument
inadvertence or the negligence of the surveyors. There is no proof, acknowledged relates to a sale, transfer, mortgage or encumbrance of two
though, that the land area indicated was intentionally and or more parcels of land, the number thereof shall likewise be set forth in
fraudulently increased. The property originally registered was the said acknowledgment.
same property that was subdivided.
 It is well-settled that what defines a piece of titled property is
not the numerical data indicated as the area of the land, but DEALINGS WITH UNREGISTERED LANDS
the boundaries or "metes and bounds" of the property
specified in its technical description as enclosing it and showing its
limits. Section 113. Recording of instruments relating to unregistered
 Petitioner miserably failed to prove any fraud, either on the part lands. No deed, conveyance, mortgage, lease, or other voluntary
of St. Jude or on the part of land registration officials who had instrument affecting land not registered under the Torrens system shall be
approved the subdivision plan and issued the questioned TCTs. valid, except as between the parties thereto, unless such instrument shall
 Other than its peremptory statement in the Complaint that the have been recorded in the manner herein prescribed in the office of the
"expansion" of the area was "motivated by bad faith with intent to Register of Deeds for the province or city where the land lies.
defraud, to the damage and prejudice of the government and of public a. The Register of Deeds for each province or city shall keep a Primary
interest," petitioner did not allege specifically how fraud was Entry Book and a Registration Book. The Primary Entry Book shall
perpetrated to cause an increase in the actual land size contain, among other particulars, the entry number, the names of the
indicated. Nor was any evidence proffered to substantiate the parties, the nature of the document, the date, hour and minute it was
allegation. presented and received. The recording of the deed and other
 That the land registration authorities supposedly erred or committed instruments relating to unregistered lands shall be effected by any of
an irregularity was merely a conclusion drawn from the "table survey" annotation on the space provided therefor in the Registration Book,
showing that the aggregate area of the subdivision lots exceeded the after the same shall have been entered in the Primary Entry Book.
area indicated on the title of the property before its subdivision. Fraud b. If, on the face of the instrument, it appears that it is sufficient in law,
cannot be presumed, and the failure of petitioner to prove it defeats the Register of Deeds shall forthwith record the instrument in the
its own cause. manner provided herein. In case the Register of Deeds refuses its
administration to record, said official shall advise the party in interest
PURPOSE OF TORRENS SYSTEM IS TO QUIET TITLE; INTEGRITY in writing of the ground or grounds for his refusal, and the latter may
OF TORRENS SYSTEM CANNOT BE SULLIED BY INEPTITUDE OF appeal the matter to the Commissioner of Land Registration in
LAND REGISTRATION OFFICIALS accordance with the provisions of Section 117 of this Decree. It shall
be understood that any recording made under this section shall be
 We cannot, therefore, adhere to the petitioner's submission that, in without prejudice to a third party with a better right.
filing this suit, it seeks to preserve the integrity of the Torrens system. c. After recording on the Record Book, the Register of Deeds shall
To the contrary, it is rather evident from our foregoing endorse among other things, upon the original of the recorded
discussion that petitioner's action derogates the very integrity instruments, the file number and the date as well as the hour and
of the system. minute when the document was received for recording as shown in
 Time and again, we have said that a Torrens certificate is evidence of the Primary Entry Book, returning to the registrant or person in
an indefeasible title to property in favor of the person whose name interest the duplicate of the instrument, with appropriate annotation,
appears thereon. certifying that he has recorded the instrument after reserving one
 True, the Torrens system is not a means of acquiring titles to copy thereof to be furnished the provincial or city assessor as required
lands; it is merely a system of registration of titles to lands. by existing law.
Consequently, land erroneously included in a Torrens certificate of d. Tax sale, attachment and levy, notice of lis pendens, adverse claim
title is not necessarily acquired by the holder of such certificate. and other instruments in the nature of involuntary dealings with
 But in the interest of justice and equity, neither may the respect to unregistered lands, if made in the form sufficient in law,
titleholder be made to bear the unfavorable effect of the shall likewise be admissible to record under this section.
mistake or negligence of the State's agents, in the absence of e. For the services to be rendered by the Register of Deeds under this
proof of his complicity in a fraud or of manifest damage to third section, he shall collect the same amount of fees prescribed for similar
persons.
Prepared by: Gas

services for the registration of deeds or instruments concerning
registered lands.  (Carumba v. CA) It was held therein that Article 1544 of the Civil
Code has no application to land not registered under Act No. 496. Like
REGISTRATION OF INSTRUMENTS DEALING WITH UNREGISTERED in the case at bar, Carumba dealt with a double sale of the same
LAND unregistered land. The first sale was made by the original owners and
All instruments affecting lands originally registered under the Spanish was unrecorded while the second was an execution sale that resulted
Mortgage Law may be recorded under Section 113 until the land shall have from a complaint for a sum of money filed against the said original
been brought under the operation of the Torrens system owners.
 Applying Section 35, Rule 39 of the Revised Rules of Court, 7 this
RECORDING OF MINISTERIAL OFFICERS Court held that Article 1544 of the Civil Code cannot be invoked
• Opening paragraph in substance declares that no instrument or deed to benefit the purchaser at the execution sale though the latter
affecting rights to real property not registered under the Torrens system was a buyer in good faith and even if this second sale was registered.
shall be valid except as between the persons thereto, until such instrument  It was explained that this is because the purchaser of unregistered
or deed shall have been registered in the manner prescribed therein land at a sheriff's execution sale only steps into the shoes of the
• This provision cannot be interpreted to include conveyances made by judgment debtor, and merely acquires the latter's interest in the
ministerial officers, such as sheriff’s deeds property sold as of the time the property was levied upon.
• It contemplates only instruments as may be created through agreement  Applying this principle, the Court of Appeals correctly held that
between parties the execution sale of the unregistered land in favor of
petitioner (Radiowealth) is of no effect because the land no
RECORDING SHALL BE WITHOUT PREJUDICE TO A THIRD PERSON longer belonged to the judgment debtor as of the time of the said
WITH BETTER RIGHT RECORDING OF RD MINISTERIAL execution sale.
• RD doesn’t exercise a judicial or quasi-judicial power in the registration
of sheriff’s deeds or certificates of sale
• If the RD refuses to register the instrument, he shall advise the party in MCIAA v. Tirol
interest in writing of the grounds for his refusal, and the latter may elevate
the matter to the Administrator en consulta Facts:
 The case started with a complaint for quieting of title filed on August
HOW RECORDING IS EFFECTED 8, 1996 by respondents Edito, Tirol, and Spouses Ngo against MCIAA.
• The RD shall keep a primary entry book and a registration book  Tirol and Ngo purchased a 2,000 sq. m. parcel of land from Jenkins,
• The primary entry book shall contain an entry number, names of parties, a Filipino citizen married to Mr. Jenkins, an American citizen, as evidenced
nature of the document, and the date, hour and minute it was presented by a Deed of Absolute Sale in Sept. 15, 1993. It was bought on the
• The recording shall be effected by annotating on the registration book strength of a clean title by vendor Jenkins shown by a Tax Declaration and
after the same shall have been entered in the primary entry book a TCT under Elma Jenkins’ name which had no annotation of adverse
• After recording, the RD shall endorse on the original of the instrument claims.
the file number and the date as well as the hour and minute when the  They succeeded in titling the said lot under their names and
instrument is received, returning to the registrant the duplicate of the proceeded to pay realty taxes. Only on January 1996 did they discover
instrument with a certification that he has recorded the same. a cloud on their title when their request for a Height Clearance with
the DOTC was referred to MCIAA, based on their ownership of the land
through purchase in 1958.
Radiowealth v. Palileo  The ownership of the lot started with Spouses Cuison and Cosef
(similar background story for both ends here). According to Tirol, it was
Facts: under Spouses Cuison and Cosef who sold to to Spouses Cuizon and
 Defendant spouses Castro sold to private respondent Palileo, a Patalinghug. They succeeded in securing a reconstitution of the OCT
parcel of unregistered coconut land. The sale is evidenced by a as shown by a Court Order which became final and executory – issued
notarized Deed of Absolute Sale. The deed was not registered in in the name of Cuison and Cosef. A Deed of Absolute Sale between Spouses
the Registry of Property for unregistered lands. Cosef/Cuison and Spouses Cuizon/Patalinghug was registered and
 Sometime later, a judgment was rendered against Castro to pay annotated. The latter spouses sold a portion to Mrs. Jenkins in 1987
petitioner Radiowealth. For failure to pay, a writ of execution was who sold the same to the plaintiffs. Appellees would be in constructive,
issued. Defendant Sheriff Eviota levied upon and finally sold at public uninterrupted, and peaceful possession for 62 years as of the date of their
auction the subject land (that defendant Enrique Castro had sold to filing of a Complaint for quieting of title.
appellee Palileo) to Radiowealth, being the only bidder. After the  On the other hand, MCIAA claims that the Spouses Cuison and Cosef
period of redemption had expired, a deed of final sale was also sold the lot to Civil Aeronautics Administration (CAA). In a Certificate
executed by the same Provincial Sheriff. Both the certificate of in 1959, Cuison confirmed he was the possessor and actual owner of the
sale and the deed of final sale were registered with the Registry lot located in the Mactan Alternate International Airport, and that the
of Deeds. duplicate copy of the CT was lost or destroyed without him or anyone else
 Learning of what happened to the land, Palileo filed an action for receiving a copy. Since then, the government through MCIAA, has been in
quieting of title. OCEA (adverse) possession of the property in the concept of an owner. It
 (TRIAL COURT & CA RULING) In favor of Palileo. CA affirmed became part of Clear Zone of Runway 22 for clearance for take-off and
trial court decision. landing. MCIAA asserts that Tirol is no more than a trustee who was
merely a successor-in-interest of Spouses Cosef/Cuison. In bad faith, the
Issues: Who, as between two buyers of unregistered land, is the spouses sold it to Spouses Cuizon/Patalinghug to Mrs. Jenkins. They
rightful owner — the first buyer (Palileo) in a prior sale that was further impute bad faith on the basis that their title came from a
unrecorded, or the second buyer (Radiowealth) who purchased the reconstituted one.
land in an execution sale whose transfer was registered in the  (TRIAL COURT RULING) In favor of MCIAA. It held that there was a
Register of Deeds. valid transfer of title from Cuison/Cosef to CAA, and the respondents
did not buy the lot from a person who could validly dispose of it. It further
Ruling: ruled that the government has been in possession of the land it bought
since 1958 where a public Deed of Absolute Sale was executed in its favor.
RULES ON DOUBLE SALES OF IMMOVABLES DOES NOT APPLY TO Respondents were in bad faith since they ignored peculiar
UNREGISTERED LANDS circumstances that should have arouse their suspicion, i.e. the fact that
the lot is only 320 meters away from the center of the runway and has
 The rule on double sales of immovables does not apply to been vacant for several decades (should have made them think that the
unregistered lands. lot could be part of the airport).
 There is no doubt that had the property in question been a registered land,  (MOTION FOR RECONSIDERATION AND CA RULING) A motion for
this case would have been decided in favor of petitioner since it was reconsideration was filed, and petitioner filed its Opposition to the motions.
petitioner that had its claim first recorded in the Registry of Deeds. The trial court reversed its decision, holding that Art. 1544 (double
 For, as already mentioned earlier, it is the act of registration that sales) finds application to the case. The Court is not convinced that
operates to convey and affect registered land. Therefore, a bona fide the buyers were in bad faith. The registration of the defendant in 1959 is
purchaser of a registered land at an execution sale acquires a good title as not the one contemplated under the law. Registration under Act. No. 3344
against a prior transferee, if such transfer was unrecorded. However, it differs materially from registration under Spanish Mortgage Law and under
must be stressed that this case deals with a parcel of unregistered land the Land Registration Act. According to the Spanish Mortgage Law, there
and a different set of rules applies. We affirm the decision of the Court is an express provision that provides that titles recorded
of Appeals. thereunder cannot be annulled or invalidated by prior unrecorded
rights. The LRA states that only transactions noted in the CT and
THERE IS NO TRANSFER OF INTEREST IF THE VENDOR IS NO entered in registry books can bind the land. Transactions under Act
LONGER THE OWNER OF THE LAND WHEN HE HAS SOLD IT No. 3344 cannot defeat a third person with a better right. Recordings under
PREVIOUSLY, EVEN IF THE PREVIOUS SALE WAS NOT RECORDED this act are not preceded by any investigation as to the validity or efficacy
of the title sought to be recorded.
 Under Act No. 3344, registration of instruments affecting unregistered  The lot was a registered land where at the time of registration of
lands is "without prejudice to a third party with a better right". The defendant’s document of sale, there was no CT because of the war. At
aforequoted phrase has been held by this Court to mean that the mere the time the TCT was issued to plaintiffs and the predecessors-in-interests,
registration of a sale in one's favor does not give him any right over the there were no annotations of the alleged claim of the defendant, so they
land if the vendor was not anymore the owner of the land having previously had good reasons to rely on validity of the title.
sold the same to somebody else even if the earlier sale was unrecorded.  The peculiar circumstances stated earlier were not enough to warn
 Basically, mere registration of Radiowealth of the sale in his favor third persons. Such fact was merely for purpose of construction of
does not give him any right over the land because the vendor buildings, not for realty ownership. CA affirmed the trial court ruling.
(Castro) was not the owner of the land anymore, having previously
sold the same to Palileo, even if the earlier sale was unrecorded). TIMELINE: Quieting of title over land -> MCIAA wins -> Motion for
Reconsideration -> Tirol wins -> CA affirms -> SC affirms on
RULES ON DOUBLE SALES DO NOT APPLY TO LAND THAT IS NOT different grounds.
REGISTERED UNDER ACT NO. 496
Prepared by: Gas

PURCHASE HISTORY ACCDNG. TO TIROL: Spouses Cosef/Cuison - unnotarized deed of sale, while the sale to petitioners was made via a
> Spouses Cuizon/Patalinghug -> Mrs. Jenkins -> Tirol and co. notarized document only in 1991, or ten years thereafter. Thus, Juanito
who was the first buyer has a better right to the lot, while the subsequent
PURCHASE HISTORY ACCDNG. TO MCIAA: Spouses Cosef/Cuison - sale to petitioners is null and void, because when it was made, the seller
> Civil Aeronautics Administration -> MCIAA (still CAA) Garcia was no longer the owner of the lot. The fact that the sale to Juanito
was not notarized does not alter anything, since the sale between him and
Issues: Between Tirol and MCIAA, who has the superior right to Garcia remains valid nonetheless. Notarization, or the requirement of a
the subject property? public document under the Civil Code is only for convenience, and not for
validity or enforceability. And because it remained valid as between Juanito
Ruling: and Garcia, the latter no longer had the right to sell the lot to petitioners,
for his ownership thereof had ceased. Nor can petitioners’ registration of
ART. 1544 ON DOUBLE SALES DOES NOT APPLY BECAUSE BOTH their purchase have any effect on Juanito’s rights. The mere registration
DO NOT HAVE THE SAME SELLER - A REQUISITE of a sale in one’s favor does not give him any right over the land if the
vendor was no longer the owner of the land, having previously sold the
 The Supreme Court ruled in favor of the respondents on different grounds. same to another even if the earlier sale was unrecorded. Neither could it
 (Cheng v. Genato) For Art. 1544 to apply, the two sales transactions validate the purchase thereof by petitioners, which is null and void.
must be valid sales, must pertain to exact same subject matter, different Registration does not vest title; it is merely the evidence of such title.
owners have conflicting interests, and they must have bought from the Moreover, Petitioners’ actual and prior knowledge of the first sale to Juanito
very same seller. The provision has no application in cases where the makes them purchasers in bad faith.
sale is initiated not by just one vendor but several successive vendors.
MCIAA got the lot from Cuison/Cosef but Tirol got it from Jenkins, THE CONDOMINIUM ACT (RA 4726)
another transferee. Both of them do not have the same seller.
PD 957 – the National housing Authority shall have exclusive jurisdiction
IMPROPER REGISTRATION DOES NOT BIND THIRD PARTIES;
MCIAA REGISTERED THE SALE UNDER ART. 3344 WHEN THE LAND to regulate the real estate trade and business xxx.
WAS REGISTERED UNDER A TORRENS TITLE; LOSS OF A
CERTIFICATE DOES NOT CONVERT THE LAND’S REGISTRATION JURISDICTION OF THE HOUSING AND LAND USE REGULATORY
BOARD (SEC. 1, P.D. NO. 1344)
 MCIAA does not contest the fact that the lot was registered under Act No. 1. Unsound real estate practices
496 before the World War II. Cuison stated in his certification that the 2. Claims involving refund and any other claims filed by a subdivision
duplicate copy of the CT was lost or destroyed during the last war
lot or condominium unit buyer against the project owner, developer,
without him receiving it.
 Well-settled is the rule that the registration of instruments must be dealer, broker, or salesman
done in the proper registry to effect and bind the land. Act No. 496 3. Cases involving specific performance of contractual and statutory
governed the recording of transactions involving REGISTERED obligations filed by buyers of subdivision lot or condominium unit
LAND. Act No. 3344 provided for the system of recording of against the owner.
unregistered lands without prejudice to a third party with a better
right. If a parcel of land covered by a Torrens title is sold but the sale is SUMMARY OF CASES OR ACTIONS OVER WHICH THE HLURB HAS
registered under Act No. 3344, the sale is not considered registered and
JURISDICTION
the registration of the deed does not operate as a constructive notice to
the whole world. a. For a determination of the rights of parties under a contract to sell
 MCIAA registered its Deed of Absolute Sale under Act No. 3344 but the a subdivision lot
subject was a registered land. It is the act of registration that binds the b. For the delivery of title against the subdivision owner
land, and absent such, the instrument executed by the parties remains c. For the refund of reservation fees for the purchase of a subdivision
only as a contract between them. lot
 Respondents are not buyers in bad faith because an improper registration
d. For specific performance filed by a lot buyer against the seller of a
is no registration at all. Incorrect registrations do not affect third persons
at all. subdivision lot
 MCIAA contends that registration under Act No. 3344 is permissible since e. For the annulment of the mortgage constituted by the project owner
the duplicate copy of the CT was lost or destroyed. without the buyer’s consent, the mortgage foreclosure sale and the
 (Melencion v. CA – note, old case sa ato LTD) Aznar argued the same condominium certificate of title issued to the highest bidder at the
point. However, the fact that the CT over registered land is lost does not said foreclosure sale
convert it into unregistered land. A CT is merely evidence of ownership f. For the collection of the balance of the unpaid purchase price of a
over the property described. They should have reconstituted the
subdivision lot filed by the developer of a subdivision against the lot
lost CT instead of registration under Act No. 3344.
 MCIAA did not bother to have the lost title reconstituted, even when the buyer; and
sale was executed in 1958. The controversy could have been avoided had g. For incidental claims for damages. (Fajardo vs. Bautista, May 10,
it not been for MCIAA’s negligence. 1994)
 Furthermore, a person dealing with registered land may rely on the h. Between homeowner’s association and their members (R.A. 8763)
correctness of the certificate of title and the law will in no way
oblige him to go beyond it to determine the legal status of property
Discussion: It is an indispensable requirement that all incorporators of a
except when the party has actual knowledge of facts and circumstances
condominium corporation must be shareholders thereof. To be a
that would impel a reasonable cautious man to make such inquiry. SC then
copy-pasted the ruling the trial court in its reconsideration of the case. shareholder, one must necessarily be an owner of a condominium unit. (p.
Tirol never thought the proximity was strange because there were 834, Agcaoili)
private houses beside the vacant lot, suggesting that the property Atty G: An owner or developer may convert a property into a condominium
must be of private ownership and not that of the airport. He took great project by executing a legal document called Master Deed. The Master
care in verifying the clean title by deputizing an employee to do research. Deed is the act that creates the condominium. It is submitted in the Office
ATO aviation rules merely proscribe the installation of buildings and other
of the Register of Deeds and it is annotated prior to the issuance of the
physical structures except landing facilities. It does not prohibit realty
ownership. corresponding Condominium Certificate of Title.
They will have to secure a clearance from the HLURB and they have to
Sabitsana Vs. Muertegui submit a plan including the brochures regarding warranties prior to the
HLURB granting them a license to sell.
Facts: Garcia executed an unnotarized Deed of Sale in favor of respondent Same with subdivisions: In subd, the lot that is considered to be a subd
Juanito over a a parcel of unregistered land covered by Tax Declaration project under P.D. 957, there must also be a deed that will be submitted
issued in Garcia’s name. Juanito’s father Domingo and brother took actual to the RD. They will also submit a license to sell coming from HLURB.
possession of the lot and planted thereon coconut and ipil-ipil trees. They Sec. 2 (RA 4726) — A condominium is an interest in real property
also paid the real property taxes on the lot. Garcia sold the same lot to the
consisting of separate interest in a unit in a residential, industrial or
Muertegui family lawyer, petitioner Atty. Sabitsana through a notarized
deed of absolute sale. The sale was registered with the Register of Deeds. commercial building and an undivided interest in common, directly or
A new one, TD No. 5327 was issued in Atty. Sabitsana’s name. He also indirectly, in the land on which it is located and in other common areas of
paid real property taxes. He introduced concrete improvements on the the building. A condominium may include, in addition, a separate interest
property, which shortly thereafter were destroyed by a typhoon. When in other portions of such real property. Title to the common areas,
Juanito’s father passed away, his heirs applied for registration and including the land, or the appurtenant interests in such areas, may be held
coverage of the lot under the Public Land Act or Commonwealth Act No.
by a corporation specially formed for the purpose (hereinafter known as
141. Atty. Sabitsana addressed to the DENR’ CENRO/PENRO office his
the "condominium corporation") in which the holders of separate interest
letter opposing the application, claiming that he was the true owner of the
lot. Juanito filed an action for quieting of title and preliminary injunction shall automatically be members or shareholders, to the exclusion of others,
against Petitioners claiming that they bought the lot in bad faith and are in proportion to the appurtenant interest of their respective units in the
exercising acts of possession and ownership over the same, which acts common areas. The real right in condominium may be ownership or any
thus constitute a cloud over his title. other interest in real property recognized by law, on property in the Civil
Code and other pertinent laws.
Issue: Who between petitioners and respondent has a better right to the
disputed lot?
Warranties and Representations
Ruling: Respondent has a better right to the lot. What applies in this case
Sec 19 (PD 957) Advertisements. — Advertisements that may be made
is Act No. 3344 which provides for the system of recording of transactions
over unregistered real estate. Act No. 3344 expressly declares that any by the owner or developer through newspaper, radio, television, leaflets,
registration made shall be without prejudice to a third party with a better circulars or any other form about the subdivision or the condominium or
right. The sale to respondent Juanito was executed in 1981 via an its operations or activities must reflect the real facts and must be
Prepared by: Gas

presented in such manner that will not tend to mislead or deceive the Trial court has no jurisdiction on cases involving specific
public. performance and damages as provided by Sec. 1 of PD 1344, it fall
under the exclusive jurisdiction of HLURB.
BPI vs ALS Management Corp.
Sec. 1 of PD 1344 expanded the jurisdiction the jurisdiction of NHA and it
Principle: granted exclusive jurisdiction to hear and decide cases involving specific
1. HLURB has exclusive jurisdiction on cases enumerated in sec 1 performance and damages, in this case the correction of defects and
PD 1344 deficiencies in the condo unit. The regulatory function of NHA were
transferred to the HSRC pursuant to EO 648 and the functions of HSRC
Facts: were transferred to the HLURB pursuant to EO 90. Therefore HLURB has
1. "On July 29, 1985, [petitioner] BPI Investment Corporation filed a sole jurisdiction on the respondent’s counterclaim.
complaint for a Sum of Money against ALS Management and
Development Corporation, alleging inter alia that on July 22, However, the petitioner is guilty of estoppel by laches and is barred from
1983,[petitioner] and [respondent] executed at Makati, Metro Manila questioning the jurisdiction of the court because BPI only raised the
a Deed of Sale for one (1) unfurnished condominium unit of the Twin question only after an adverse decision had been rendered. BPI is
Towers Condominium located at Ayala Avenue, corner Apartment considered to have voluntarily submitted to the trial court’s jurisdiction.
Ridge Street, Makati, Metro Manila designated as Unit E-4A The doctrine of laches is based on equity and fairness, if the petitioner’s
comprising of 271 squares [sic] meters more or less, together with prayer is granted then it would in effect be declaring as useless all the
parking stalls identified as G022 and G-63. proceedings had in the present case and compel the judgment creditors to
2. T he Co n do mi ni um Ce r ti fi cate o f T i tl e N o . 48 0 0 o f t he go up their Cavalry once more.
Regi st ry o f Deeds for Makati, Metro Manila was issued after the
execution of the said Deed of Sale. Second and Third Issues: APPRECIATION OF FACTS
3. [Petitioner] advanced the amount of P26,300.45 for the expenses in Factual findings of the lower courts are entitled to great respect, but may
causing the issuance and registration of the Condominium Certificate be reviewed if they do not conform to law and to the evidence on record.
of Title. In this case the court modify the award granted by the CA.
4. Und er t he De ed o f S al e, i t i s sti pu l a te d that the VENDEE
[respondent] shall pay all the expenses for the preparation Warranties and Representations in the Brochure
and registration of this Deed of Sale and such other documents as
may be necessary for the issuance of the corresponding The brochure that was disseminated indicated features that would
Condominium Certificate of Title. provide each condo unit and therefore would form part of the sales
5. A ft er th e [p eti ti o ner ] co m pl i ed w i th i t s o bl i gati o ns u nd er warranties of BPI. ALS management relied on the brochure in its decision
th e sai d De ed of Sale, [respondent], notwithstanding demands to purchase a unit.
made by [petitioner],failed and refused to pay [petitioner]
its legitimate advances for the expenses mentioned above. However, general disclaimer which are intended to give a general
6. In its Answer with Compulsory Counterclaim, [Respondent] idea of the project to be undertaken are not to be relied as
averred among others that it has just and valid reasons for refusing statements or representation of facts.
to pay [petitioner’s] legal claims.
a. I n cl ear a nd di re ct co n tr av e nti o n o f S ec ti o n 25 o f “ … Destined to reflect condominium living at its very
Pr esi de nti al Decree No. 957 which provides that ‘No fee except best and it’s design … will make the project the only
those required for the registration of the deed of sale in the one of its kind in the Philippines.”
Registry of Deeds shall be collected for the issuance of such
title’, the[petitioner] has jacked-up or increased the amount of its This disclaimer should not apply to the feature and amenities that the
alleged advances for the issuance and registration of the brochure promised to provide each condo unit.
Condominium Certificate of Title in the name of the[respondent],
by including therein charges which should not be collected from Storage Facilities – cancelled by the court bec. It was not alleged.
buyers of condominium units.
b. "[Respondent] further averred that [petitioner] represented to the The non-delivery had not been alleged in respondent’s Answer with
[respondent] that the condominium unit will be delivered Counterclaim. As a general rule issues in each cases are limited to those
completed and ready for occupancy not later than December31, presented in the pleadings. The exception to the rule which is that
1981. [Respondent] relied solely upon the descriptions and evidence has been presented properly, with full opportunity on the part
warranties contained in the aforementioned brochures which has of the opposing parties to support their respective contention and to
a general disclaimer of “ … Destined to reflect condominium refute each other’s evidence is not present in the case at bar.
living at its very best and it’s design … will make the project
the only one of its kind in the Philippines.” and other sales Damages for Delay in Delivery – cancelled by the court bec. of
propaganda materials when [respondent ]agreed to buy Unit E-4A insufficiency of evidence
of the Twin Tower(s) for the hefty sum of P2,048,900.00
considering that the Twin Towers was then yet to be built. In The only evidence the respondent have is the testimony of its witness
contravention of [petitioner’s] warranties and of good engineering that a lease contract had indeed been intended to commence in January
practices, the condominium unit purchased by [respondent] 1982, instead of the actual implementation on June 18, 1982.
suffered from defects and/or deficiencies. Respondent
7. Trial court ruled: Condominium Defects (balcony passageway) – cancelled by the court
a. Ordering the [respondent] to pay [petitioner] the bec. it was not intended to be a walkway
sum of P26,300.45, with legal interest from the filing of the
complaint up to full payment thereof, representing the amount Respondent was able to establish through its witness testimony
spent for the registration of the title to the condominium unit confirmed by an inspection report that the condominium unit suffered
in [respondent’s]name; from defects. BPI’s contention that the claim has already prescribed must
b. Ordering [petitioner] to deliver, replace or correct at fail for being raised for the first time on appeal.
[petitioner’s]exclusive expense/cost or appoint a licensed However, BPI are not required to correct the balcony bec. The portion in
qualified contractor to do the same on its behalf, the following controversy was not intended to be a walkway as testified by the
defects/deficiencies in the condominium unit owned by the architect. The building plain had not specified the with. It was not shown
[respondent. that the balcony was insufficient to serve its purpose for which it was
c. Ordering [petitioner] to pay [respondent] the following: intended.
i. The sum of P40,000.00 representing reimbursement for
expenses incurred for the materials/labor in installing Reimbursement for Completion of Work – cancelled by the court bec. ALS
walls/floor titles in 2 bathrooms and bar counter cabinet. failed to proved the actual amount spent.
ii. The sum of P136,608.75, representing unearned income
iii. The sum of P27,321.75 per month for a period of twenty- Respondent failed to establish with reasonable certainty the actual
one (21) months (from May 1985 to January amount spent. ALS failed to present document such as receipt to support
1987),representing unearned income the expenses. In determining actual damages it must depend on
competent proof not on mere assertion or guesswork.
8. Court of Appeals sustained the trial court’s finding that
"while[petitioner] succeeded in proving its claim against the Unearned Lease Income – cancelled by the court bec. ALS failed to
[respondent]for expenses incurred in the registration of [the latter’s] proved gihapon
title to the condominium unit purchased, x x x for its part
[respondent] in turn succeeded in establishing an even bigger claim ALS failed to adduce evidence that unit had been offered for lease to
under its counterclaim." others, but that there were no takers because of the defects. However,
ALS is entitled to temperate damage because it suffered damages when
Issue: its lessee vacated the condominium.
1. Whether or not the trial court had jurisdiction over the
respondent’s counterclaims San Miguel Properties, Inc. vs BF Homes, Inc.
2. Whether or not the decision of the CA is based on
misapprehension of facts warranting a review of the factual Principle:
findings. 1. HLURB has exclusive jurisdiction on cases enumerated in
3. Whether or not the award of damages is conjectural warranting sec 1 PD 1344, it does not have to rely on the findings of
a review of the factual findings. others to discharge its adjudicatory functions.
2. Condominium Act is under the exception of doctrine of
Ruling: primary jurisdiction because it involves public interest.
3. Upon full payment the owner or developer is mandated by
First Issue: JURISDICTION law to deliver the title to the buyer.
FACTS:
Prepared by: Gas

 BF Homes is the owner of several parcels of land, particularly Sec. 25 of PD 957 explicitly mandate that the owner or developer
identified as Italia II lots. BF Homes represented by Orendain as shall deliver the title to the buyer upon full payment. SMPI submitted
rehabilitation receiver appointed by the SEC entered into three adequate proof showing full payment to and receipt by BF Homes of the
successive Deed of Absolute Sale with SMPI. purchase price for the 130 Italia II lots as fixed in the Deed of Absolute
 SMPI completed the payments for the 130 Italia II lots. BF Sale. Upon full payment by SMPI, it became mandatory upon BF Homes to
Homes delivered the TCTs to SMPI but only for 110 of the 130 deliver the TCTs, the seller loses all its rights and interest to the unit in
Italia II lots purchased by SMPI. SMPI filed a Complaint for favor of the buyer. [G.O.A.L. vs CA].
specific performance with damages before the HLURB to compel The following are the grounds of BF Homes of its refusal to deliver the
BF Homes to deliver the remaining 20 TCTs to SMPI. remaining 20 TCTs:
 In its Answer (with Counterclaim), BF Homes alleged that the (1) The Deeds of Absolute Sale were not notarized
Deed of Absolute Sale were entered by Orendain without The requirement of a public document in Art 1358 is not for
authority, as his appointment as receiver was revoked by the validity of the instrument but for its efficacy. Although a conveyance of
SEC. BF Homes also averred that the consideration paid by SMPI land is not made in a public document, it does not affect the validity of
was inadequate and the Deed of Absolute Sale were undated such conveyance. The effect of non-compliance with the requirements of
and not notarized. Statutes of Fraud is simply that no action can be enforced, the form is
 SMPI in its Reply (Answer with Counterclaim) countered that the required for evidentiary purposes only. As private documents, the Deeds
validity of the 3 Deed of Absolute Sale was already upheld by are still binding and valid. SMPI could compel BF Homes to comply with
SEC and were deemed final, executory, and unappealable. As a the formality requirement under Art. 1358.
result the sale were binding on BF Homes. SMPI further Statute of Frauds is only applicable to executory contracts and
maintained that Orendain was authorized bec. He was acting in not those which has been fully paid like in this case. Under Art 1405
behalf of FBO Networks(the receiver who replaced Orendain) acceptance of benefits ratifies unenforceable contracts. The Deeds were
being the Chairman of FBO Networks. SMPI additionally asserted already ratified as BF homes had accepted the benefits from said contracts
that absent substantiation, the allegation of BF Homes of when it received full payment from SMPI the purchase price of 130 Italia
inadequate consideration was self-serving; and that despite II lots. The Deeds were also substantially performed considering that BF
being undated and not notarized, the Deed of Absolute Sale were Homes had previously delivered 110 out of 130 TCTs.
valid since they contained the essential elements of a contract. (2) Orendain did not have authority entering into the contracts
 HLURB ruled that the issue on whether or not Mr. Orendain has of sale with SMPI
no authority must first be resolved by the SEC and suspended When Orendain signed the Deeds of Absolute Sale, he did so as
the proceeding of the instant complaint until final resolution a Chairman of FBO Networks Management Inc., the appointed receiver of
pending before the SEC. BF Homes. Under SEC Reorganization Act, the receiver is empowered to
 SMPI filed a Petition for Review with the HLURB Board of take custody and control of all existing assets and properties of such
Commissioner contending that the principle of suspending a case corporations under its management. The acts of the receiver, being
due to a prejudicial question only applies to criminal cases and appointed officer of the SEC, enjoy the presumption of regularity. While
that BF homes was mandated by law under PD957 to deliver the BF Homes questioned the acts of Orendain/FBO as receiver before the SEC,
TCTs of the remaining 20 Italia II lots, which had already been the SEC terminated the rehabilitation proceedings without definitely ruling
paid in full. on the same and recognized the transfer of jurisdiction over such subject
 The HLURB Board of Commissioners denied that petition for matter to RTC with the passage of RA 8799. There is no showing whether
review applying the doctrine of primary jurisdiction. BF Homes pursued before the RTC any case to nullify or invalidate the
 SMPI appealed the decision before the Office of the President alleged unauthorized or irregular acts of Orendain/FBO as receiver.
which ruled that HLURB does not have to rely on the Moreover, even assuming Orendain is without authority the said
findings of others to discharge its adjudicatory functions. contracts were merely unenforceable and could be ratified. BF Homes
The OP then proceeded to resolve the case and reversed and set ratified the Deeds with SMPI by accepting full payment from SMPI of
aside the decision of HLURB ordering BF to deliver to SMPI the the purchase price for the 130 Italia II lots, and fully implementing the
titles to the lots subject of the instant case. transaction covered by the 2 Deeds and partially implementing the 3 rd by
 BF Homes filed a Petition for Review with the CA which affirmed delivering the TCTs for 110 out of 130 lots. Also BF Homes is estopped
that the proceedings before the HLURB should not be from denying the authority of Orendain after accepted the benefits.
suspended, however, CA ordered the remand of the case to (3) the consideration for the said Italia II lots were grossly
HLURB in recognition of the doctrine of primary jurisdiction. inadequate and disadvantageous for BF Homes
The Revised Rules of Court presumes private transactions have
ISSUE: been fair and regular. The only evidence submitted by BF Homes is the
1. Whether or not the HLURB did not have to suspend the appraisal report which valued at P3,500 and P3,000 per sqm. The appraisal
proceedings? Yes report, does not necessarily prove that the purchase price averaged at
2. Whether or not there is a need to remand the case to P2,500 as grossly inadequate. SMPI explained that it was granted a lower
HLURB? No price because it bought the Italia II lots in volume, and BF Homes was
3. Whether or not SMPI is entitled to the delivery of the unable to repudiate said explanation.
remaining 20 TCTs for the lots it purchased? Yes SEC vs HLURB Jurisdiction
In the ARRANZA case, the Supreme Court said that:
For the SEC to acquire jurisdiction over any controversy
RULING: under these provisions, two elements must be considered: (1) the
First Issue: Suspension of proceedings by the HLURB status or relationship of the parties; and (2) the nature of the
HULRB has exclusive jurisdiction in a complaint for specific question that is the subject of their controversy.
performance for the delivery of a certificate of title to a buyer of a The first element requires that the controversy must
subdivision lot [BPI vs ALS]. In the exercise of its exclusive arise "out of intra-corporate or partnership relations between and
jurisdiction, HULRB did not have to suspend the proceedings and should among stockholders, members or associates; between any or all of
have went ahead to resolve the complaint for specific performance filed by them and the corporation, partnership or association of which they
SMPI given its statutory mandate under Sec.1 of PD 1344. A ruling by the are stockholders, members or associates, respectively; and
SEC that Orendain did not have authority as a receiver is not absolutely between such corporation, partnership or association and the
determinative of the fate of the complaint for specific performance of SMPI State in so far as it concerns their individual franchises. DHITCc
before the HLURB. The HLURB could already make a preliminary finding on In the instant case, [SMPI] is not a stockholder, member or
the validity of the Deed of Absolute Sale executed by Orendain for the associate of [BF Homes]. It is a lot buyer in the subdivision developed by
purpose of ascertaining the right of SMPI to the delivery of the 20 TCTs. [BF Homes.]
Under PD 957 HULRB is empowered to interpret and apply contracts, and The second element requires that the dispute among the
determine the rights of private parties under these contracts. This ancillary parties be intrinsically connected with the regulation or the internal
power, generally judicial, is now no longer with the regular courts to the affairs of the corporation, partnership or association.
extent that the pertinent HLURB laws provide. the Supreme Court also said:
Second Issue: Remanding of the case to HLURB P.D. No. 902-A, as amended, defines the jurisdiction of the SEC;
Returning the instant case to the HLURB for further proceedings while P.D. No. 957, as amended, delineates that of the HLURB. These two
will simply be circuitous and inconsistent with the summary nature of quasi-judicial agencies exercise functions that are distinct from
HLURB proceedings. The objective of the Revised Rules of Court is to each other. The SEC has authority over the operation of all kinds of
promote a just, speed, and inexpensive disposition/determination of every corporations, partnerships or associations with the end in view of
action. protecting the interests of the investing public and creditors. On the other
Pursuant to the doctrine of primary jurisdiction, generally “ hand, the HLURB has jurisdiction over matters relating to observance of
the courts cannot determine a controversy involving a question which is laws governing corporations engaged in the specific business of
within the jurisdiction of an administrative tribunal, where it requires development of subdivisions and condominiums. The HLURB and the SEC
special knowledge to determine technical and intricate matters of fact, and being bestowed with distinct powers and functions, the exercise of those
a uniformity of ruling is essential to comply with the purposes of the functions by one shall not abate the performance by the other of its own
regulatory statute administered”. However, there is an exception where functions. As respondent puts it, "there is no contradiction
judicial intervention is urgent and when strong public interest is between P.D. No. 902-A and P.D. No. 957.
involved, which are present in this case. Under PD 957 subdivision and
condominium development involves public interest and welfare because Redemption of Mortgaged Amortization
shelter is a basic human need whose fulfillment cannot afford any kind of
delay. SEC 25. (PD 957) Issuance of Title. The owner or developer shall
If the case is no longer remanded, BF Homes cannot claim deliver the title of the lot or unit to the buyer upon full payment of the lot
denial of due process because in the instant case SMPI and BF Homes
or unit. No fee, except those required for the registration of the deed of
were afforded the opportunity to present and address each other’s
arguments through exchange of pleadings, as well as to submit their sale in the Registry of Deeds, shall be collected for the issuance of such
respective evidence before the HLURB Arbiter. To remand the case and title. In the event a mortgage over the lot or unit is outstanding at the time
repeat the entire process once again before the HLURB Arbiter is of the issuance of the title to the buyer, the owner or developer shall
impractical, unreasonable and oppressive for SMPI. redeem the mortgage or the corresponding portion thereof within six
Third Issue: Delivery of the remaining 20 TCTs months from such issuance in order that the title over any fully paid lot or
unit may be secured and delivered to the buyer in accordance herewith
Prepared by: Gas

cause the release of the mortgage. So the title should be issued to him, it
De Vera vs CA must be clean and the developer must pay for the mortgage constituted.
So in this case, De Vera was not bound by the mortgage constituted on
FACTS: Q. P. San Diego Construction, Inc. (QPSDCI), owned a parcel of the property and even if there was a valid mortgage, assuming the
land located at 101 Panay Avenue, Quezon City, on which it built Lourdes approval of the HLURB, the seller or developer is mandated under the law
I Condominium. On 10 June 1983, to finance its construction and to redeem the real estate mortgage and deliver the title or unit to him as
development, Q.P San Diego Construction Inc., (QPSDCI), entered into a soon as it is paid in full without any additional charge in the registration
Syndicate Loan Agreement with respondent banks (here collectively known fee or outstanding balance. So this PD 957 really provided protection both
as Funders) to finance the construction and development of Lourdes to condominium and subdivision buyers. Respondent ASIATRUST had
Condominium I. QPSDCI mortgaged to the creditor banks as security its made several representations to petitioner that his loan had been
Panay Avenue Property and the condominium constructed thereon. De approved. The tenor of the letters sent by ASIATRUST would lead a
Vera and QPSDCI entered into a Condominium Reservation Agreement reasonable man to believe that there was nothing left to do but await the
where petitioner undertook to buy Unit 211-2C of the condominium. release of the loan. ASIATRUST cannot hide behind the pithy excuse that
Petitioner's remaining balance of the purchase price was to be secured the grant of the bridge financing loan was subject to the release of the
through his housing loan, P160,00.00. The loan approved was only Pag-IBIG loan
P139,00.00 and not 160,000.00, De Vera negotiated the deficiency to
which QPSDCI agreed. Suspension of Monthly Amotization
The condominium project was substantially completed in June
1984 and the unit was turned over to De Vera Jr. the following month. OPTION TO SUSPEND PAYMENT OR DEMAND FOR REIMBURSEMENT
Accordingly, petitioners paid QPSDCI P23,916.67 shortfall between the GIVEN TO BUYER
balance and the granted loan. Meanwhile, QPSDCI failed to pay its
obligations to the Funders. Asiatrust extra-judicially foreclosed the In case the developer of a subdivision or condominium fails in its obligation
mortgage on the condominium units, including that of petitioner. under Section 20 of P.D. No, 957, Section 23 of the law gives the buyer
ASIATRUST through its V-Presidebt Oerdi V. Lucero wrote asking the unit the option to demand reimbursement of the total amount paid, or to wait
buyers to pay in advance the cost of the transfer of titles and registration for further development of the subdivision, and when the buyer opts for
of their PAG-IBIG loan mortgages. ASIATRUST also wrote a letter to the latter alternative, he may suspend payment of installments until such
petitioner informing him that his housing loan would only be implemented time that the owner or developer had fulfilled its obligation to him.
upon the following conditions: (a) Payment of the remaining equity directly
to ASIATRUST Development Bank; and (b) Signing of all Pag-IBIG Law provides two remedies in case of incomplete development of the
documents not later than 20 October 1984. IN SHORT WALA NA GRANT subdivision project:
ANG IYAHANG LOAN. 1. reimbursement of the total amount paid, including amortization
ASIATRUST informed QPSDCI that it could no longer extend the interest but excluding delinquency interests, with interest
bridge financing loan to some of the buyers, including petitioner, for thereon at the legal rate; or
various reasons,10 among which was that petitioner had already exceeded 2. for the buyer to suspend amortization payments until the
the age limit, hence, he was disqualified completion of the project
As petitioner failed to get the loan, he failed to pay the purchase
price. QPSDCI sent him a letter13 dated 6 August 1987 presenting him These remedies are available to the prospective buyer to give effect to the
with two options: (a) to pay the remaining balance of the purchase price, law’s intent to protect the buyers from abusive owners/developers of
with interest, which had already ballooned to P263,751.63, on or before subdivisions. In cases of incomplete development, it is the developer who
15 August 1987; or, (b) to pay rent for the use of the unit from 28 July is the one at fault, as it would then have violated its promise to the
1984 to June 1987. prospective buyers to provide the necessary facilities in the subdivision.
Since petitioner had already invested a substantial amount in The aggrieved party, therefore, is the prospective buyer because of the
remodeling and improving his unit, rescinding the sale was no longer a non-fulfillment of the developer’s commitment. As such, it is but logical
viable option. QPSDCI suggested that De Vera be that the option is given to the prospective buyer, not to the developer.
QPSDCI failed to pay its obligation to the FUNDERS, ASIATRUST
extrajudicially foreclosed the mortgage on 27 condominium units, Gold Loop Properties Inc. v CA
including that of De Vera. The units were sold at a public auction with the
FUNDERS as the highest bidder, such was annotated on the CCT’s. FACTS: Respondents Bhavna Harilela and Ramesh Sadhwani submitted
De Vera filed a complaint against the respondents which was raffled and through St. Martin Realty Corporation, a realtor agent of petitioner Gold
to Branch 107 of the RTC of Quezon City. Loop Properties, Inc. a signed pro forma reservation application addressed
to GLPI for the purchase of one (1) condominium unit at Gold Loop Towers
ISSUE: (1) Whether or not the court has jurisdiction over the case x residential complex. One of the terms of the reservation was the exectution
(2) Who has a better right over the condominium unit in question? of a contract to sell once a the downpayment was paid in full.
RULING:
1. No, the HLURB has jurisdiction. The Sadhwanis paid GLPI the amount of P819,531.25.
Subsequently, Bhavna Harilela signed a "Contract To Sell"2 with GLPI,
The regular courts have no jurisdiction over the case since the represented by its President Emmanuel Zapanta. Ms. Guina assured them
proper venue is with the HLURB. Petitioner is partly to blame for filing it that they would be furnished with a copy of the contract after its
with the regular courts and since the respondents also filed their notarization, and that the amount, representing the balance of the
counterclaims in the lower court, then they are estopped. purchase price, would be included in a loan application with a bank.
However, the contract to sell was not notarized, as the private respondents
2. The petitioner De Vera has better right. were not able to supply GLPI with a copy of their passports.
Under the contract, GLPI agreed to sell to Sadhwanis a 198.75
The mortgage in favor of the FUNDERS did not bind petitioner in square meters condominium unit particularly Unit R-84 of Southwest
as much as it is not registered with the NHA contrary to the mandate of Tower. The contract price was P2,484,375.00, inclusive of a reservation
Sec. 18 of PD 957. QPSCDI also violated its contract with petitioner by its deposit of P50,000.00.
failure to remit the latter’s payment. GLPI informed the Sadhwanis that the bank loan accommodation
The appellate court further found that QPSDCI breached its which was to serve as payment of the balance of the purchase price was
warranties as seller under Art. 1547, and also violated its obligation to disapproved, and thus, per the terms of the Contract to Sell, the balance
deliver to petitioner a clean title as required by Sec. 4 of PD 957. It would become payable through the Co-terminus Payment Plan schedule of
declared that delivery of the unit to petitioner operated to transfer payments.
ownership to him from QPSDCI. Respondent Ramesh J. Sadhwani demanded a copy of the
In, Sec 25 of PD 957, it is clear that upon full payment, the seller contract to sell, noting that his wife had no official document to show that
is duty-bound to deliver the title of the unit to the buyer. Even with a valid she bought a condominium unit from GLPI and there were conditions
mortgage over the lot, the seller is still bound to redeem said mortgage and/or stipulations in the contract which she could not be expected to
without any cost to the buyer apart from the balance of the purchase price comply with, unless a copy of the same be given to her. Spouses
and registration fees. It has been established that respondent QPSDCI had
been negligent in failing to remit petitioner's payments to ASIATRUST. If NOTE!: Sadhwanis failed to pay any of the monthly amortizations in the
QPSDCI had not been negligent, then even the possibility of charges, liens payment plan. Petitioners sent a letter demanding payment of the balance
or penalties would not have arisen. Therefore, as between QPSDCI and and informed the Sadhwanis that GLPI will rescind the Contract to Sell and
petitioner, the former should be held liable for any charge, lien or penalty automatically forfeit their down payment should they fail to pay. Sadwanis
that may arise. - offered to resell their rights over the condominium to GLPI but was
Extrajudicial foreclosure was rendered null and void. rejected because the purchase price was unreasonable, unfair and
Respondents did not appeal. Petitioner contests the decision of inequitable. Spouses Sadhwanis failed to pay any of the monthly
the Court of Appeals only insofar as it deleted the award of actual and amortizations in the payment plan. Petitioners sent a letter demanding
exemplary damages and attorney's fees. The only issue to be addressed payment of the balance amounting to P1,614,814.80, and informed the
by this Court therefore is the propriety of the award of damages in favor Sadhwanis that GLPI will rescind the Contract to Sell and automatically
of petitioner. forfeit their down payment should they fail to pay within five (5) days from
receipt of the letter in accordance with section 8 of the contract to sell.5
IT IS NOT THE ISSUE BUT THE COURT DISCUSSED WHO IS LIABLE Spouses Sadhwanis filed with the Housing and Land Use Regulatory Board
FOR DAMAGES – ASIATRUST for misrepresenting. (hereinafter referred to as HLURB), a complaint for specific performance
(give them a copy of the Contract to Sell) with an alternative prayer for
NOTE: refund against GLPI.
The rule is when it comes to a condominium projects, it is not
supposed to mortgage the unit without the approval of the HLURB. The ISSUE: Whether or not respondents may suspend payment of their
moment a mortgage is constituted on a condominium, it starts first with monthly amortizations due to failure of petitioners to furnish them copy of
the lot, with the title to the land. The moment we issue the corresponding the contract to sell.
condominium title, the mortgage constituted on the lot will be carried over
to the condominium certificate of titles. So every time somebody buys a RULING: Yes, Private respondents may suspend their payment.
condominium unit, under the law, the developer is under obligation to Respondents were indeed justified in suspending payment of their monthly
amortizations. The failure of petitioners to give them a copy of the Contract
Prepared by: Gas

to Sell sued upon, despite repeated demands therefor, and undivided interest. As such, petitioner cannot invoke Sec. I, Art. III, of the
notwithstanding the private respondents payment of P878,366.35 for the Bill of Rights which provides that "No person shall be deprived of life,
subject condominium unit was a valid ground for private respondents to liberty or property without due process of law." Petitioner alone does not
suspend their payments. own the parking area. The parking space is owned in common by the
The private respondents are entitled to a copy of the contract to sell, developer and the unit owners. Private respondents must be allowed to
otherwise they would not be informed of their rights and obligations under use the parking area.
the contract.
NOTE!: In this case, as you have noticed, the developer Gold Loop always SUBDIVISION AND CONDOMINIUM PROTECTIVE
refused to give a copy to the
respondents of the Contract to Sell because at the back of their minds,
BUYER’S
they already have an intention to rescind the contract because of the DECREE (PD 957)
default in the payments by the spouses. DEFAULT ANG NAG-UNA
Jurisdiction of HLRUB
That’s why if you enter into contracts like this, you should insist for a copy
as a matter of fact you can ask that the contract to sell be annotated in According to P.D. No. 1344, the National Housing Authority (now the
the cert of title or in the condominium cert of title. So, this is a valid ground HLURB) shall have exclusive jurisdiction to hear and decide cases of the
to suspend the payment of the monthly amortizations. The spouses following nature:
Sadhwani in this case were saved because they have in fact defaulted in a. Unsound real estate business practices;
their payments and they were able to use this defense and they were also b. Claims involving refund and any other claims filed by
aided by a lawyer to guide them. subdivision lot or condominium unit buyer against the project
owner, developer, dealer, broker or salesman; and
Alteration of Plans c. Cases involving specific performance of contractual and
statutory obligations filed by buyers of subdivision lot or
Sec. 22. (PD 957) Alteration of Plans. — No owner or developer shall condominium unit against the owner, developer, dealer, broker
change or alter the roads, open spaces, infrastructures, facilities for public or salesman.
use and/or other form of subdivision development as contained in the
approved subdivision plan and/or represented in its advertisements, Ortigas & Company, Limited Partnership vs. Court Of Appeals
without the permission of the Authority and the written conformity or
consent of the duly organized homeowners association, or in the absence DOCTRINE: Its jurisdiction is limited to those cases filed by the buyer or
of the latter, by majority of the lot buyers in the subdivision owner of a subdivision lot or condominium unit and based on any of the
causes of action enumerated in Section 1 of P.D. 1344.
G.O.A.L Inc. v CA
FACTS: Petitioner, a realty company, developed the Ortigas Center. This
FACTS: GOAL and the National Housing Authority (NHA) entered into an case concerns the Pasig City side of the commercial district known as the
agreement whereby NHA extended to GOAL a loan of 4.425 million for the Ortigas Center, known in 1969 as Capitol VI Subdivision.
construction of Gemin I Condominium. A Contract Agreement was entered Respondent filed a complaint against Ortigas for specific compliance. It
into between GOAL and Matson International Corporation for the alleged that Ortigas failed to comply with Mun Ordinance 5, Series of 1966
construction of the condominium within 1 year at the cost of 4.2 million. which required it to designate appropriate recreational and playground
However, the contractor abandoned the project with only 60% facilities at its former Capitol VI Subdivision (regarded as a residential
of it finished. GOAL offered the condominium units for sale with private site), now the Pasig City side of the Ortigas Center. Further, it alleged that
respondents among its buyers, NHA. To remedy the situation brought despite the fact that the plan was only approved by the Municipal Council
about by the abandonment of the project by the first contractor, GOAL as to layout, petitioner proceeded to develop the property without securing
subsequently pursued the construction of the fifth floor with NHA granting a final approval.
additional funding on the condition that it would hold on to the Ortigas alleged that its development plan for the subject land was for a
condominium certificates of title of private respondents. commercial subdivision, outside the scope of MO 5 that applied only to
Private respondents filed with the Housing and Land Use residential subdivisions; that the City cannot assail the validity of that
Regulatory Board (HLURB), Office of Appeals, Adjudication and Legal development plan after its approval 25 years ago. Ortigas filed a motion
Affairs (OAALA), a complaint against GOAL. Among the issues raised were to dismiss the case on the ground that the RTC had no jurisdiction over it,
the illegal construction of the fifth floor of Gemin I Condominium, the such jurisdiction being in the Housing and Land Use Regulatory Board
failure to deliver the title of private respondent Filomeno Teng despite his (HLURB) for unsound real estate business practices.
repeated demands, and the failure to provide adequate parking spaces for RTC denied the motion and held that HLURB's jurisdiction pertained to
the unit owners. disputes arising from transactions between buyers, salesmen, and
subdivision and condominium developers. In this case, the City is a lgu
ISSUES: 1. Whether or not the construction of the floor is illegal. seeking to enforce compliance with a mun ordinance, an action that is not
within the scope of the disputes cognizable by the HLURB.
RULING:
(1) Yes, it is illegal. ISSUE: Whether or not the jurisdiction over the City's action lies with the
The above provision is clear. We do not have to tussle with legal RTC, not with the HLURB.
hermeneutics in the interpretation of Sec. 22 of P.D. 957. The written
approval of the National Housing Authority alone is not sufficient. It must RULING: Yes. Executive Order 648 empowers the HLURB to hear and
be coupled with the written conformity or consent of the duly organized decide claims of unsound real estate business practices against land
homeowners association or the majority of the lot buyers. Failing in this, developers. Ultimately, whether or not the HLURB has the authority to hear
the construction of the fifth floor is violative of the decree (Sec. 22 of PD and decide a case is determined by the nature of the cause of action, the
957) invoked. subject matter or property involved, and the parties. Section 1 of P.D.
1344 vests in the HLURB the exclusive jurisdiction to hear and decide the
Failure to deliver the title following cases:
GOAL’s contention that it should not have been faulted for failing
to deliver the title to private respondent Teng as the proximate cause (a) unsound real estate business practices;
thereof was the abandonment of the construction project by the first (b) claims involving refund and any other claims
contractor, hence, due to force majeure. There is no one else to blame but filed by subdivision lot or condominium unit buyer
itself. Upon full payment of the agreed price, petitioner is mandated against the project owner, developer, dealer,
by law to deliver the title of the lot or unit to the buyer. broker, or salesman; and
Second contention, GOAL attempts to justify its failure to deliver the (c) cases involving specific performance of
certificate of title of private respondent Teng by claiming that it used the contractual and statutory obligations filed by
title as part collateral for the additional loan NHA had extended for the buyers of subdivision lots or condominium units
construction of the fifth floor. against the owner, developer, dealer, broker or
While we empathize with petitioner in its financial dilemma we cannot salesman.
make innocent parties suffer the consequences of the former's lack of
business acumen. Upon full payment of a unit, petitioner loses all its right Unlike paragraphs (b) and (c) above, paragraph (a) does not state which
and interests to the unit in favor of the buyer. Consequently, it has no right party can file a claim against an unsound real estate business practice.
to use the certificate of title of respondent Teng as collateral for a new But, in the context of the evident objective of Section 1, it is implicit that
loan. The title of Teng must be released to him as provided by law. the "unsound real estate business practice" would, like the offended party
1.) Off-street parking vs indoor parking areas in paragraphs (b) and (c), be the buyers of lands involved in development.
With respect to the second issue, petitioner contends that the decision of The policy of the law is to curb unscrupulous practices in real estate trade
the Court of Appeals is contrary to law considering that under Sec. 12-D, and business that prejudice buyers.
No. 2, Rule V of the Implementing Rules of P.D. 957, what should be given
for free are only "off-street" parking spaces and not indoor parking areas. Not every case involving buyers and sellers of subdivision lots or
condominium units can be filed with the HLURB. Its jurisdiction is limited
Petitioner is wrong. It has for purposes of its own construed "off-street" to
mean "not including indoor." On the other hand, the law does not exclude to those cases filed by the buyer or owner of a subdivision lot or
condominium unit and based on any of the causes of action enumerated in
"indoor parking." What it specifically excludes is "street parking."
Section 1 of P.D. 1344. The City had not bought a lot in the subject area
Therefore, parking may be in the basement or, in the absence thereof, in
the first floor. from Ortigas which would give it a right to seek HLURB intervention in
enforcing a local ordinance that regulates the use of private land within its
Furthermore, at this point, a definition of terms may be necessary. In a
condominium, common areas and facilities are "portions of the jurisdiction in the interest of the general welfare. It has the right to bring
such kind of action but only before a court of general jurisdiction such as
condominium property not included in the units," whereas, a unit is "a part
of the condominium property which is to be subject to private the RTC.
ownership."5 Inversely, that which is not considered a unit should fall
under common areas and facilities.
Hence, the parking spaces not being subject to private ownership form
part of the common area over which the condominium unit owners hold
Prepared by: Gas


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Land Titles and Deeds [EH 408 S. Y.

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Arcaina vs. Ingram

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Petitioner insists that PNB is not a mortgagee in good faith asserting

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CARLOS IS NOT A BUYER IN GOOD FAITH NATURE OF ATTACHMENT

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Basically, the case is about registration of land that was granted to

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Homeowners Savings vs Delgado Facts:

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REGISTRATION OF JUDGEMENTS, ORDERS;

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REGISTRATION OF PATENTS Principles:

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Facts: Section 105. Certificates of Land Transfer Emancipation Patents.

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Fallo: COMPLIANCE WITH JURISDICTIONAL REQUIREMENTS IS

PROOF REQUIRED FOR RECONSTITUTION Saint Mary Crusade v. Riel

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Prepared by: Gas

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Prepared by: Gas

Prepared by: Gas

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Prepared by: Gas