SAN LORENZO DEVELOPMENT CORP. v CA Facts: Sps. Lu owned 2 titled lots (3.

6 hectares) and they sold it Aug 20, 1986 to Babasanta for 15/sqm. Babasanta made a downpayment of 50K, evidenced by memorandum receipt issued by Pacita Lu; his total payments reached 200K May 1989, Babasanta wrote a letter to Pacita demanding the execution of DOS in his favor, having received info that sps. sold the same to another person Pacita replied, acknowledged having agreed to sell the property but reminded B that when balance became due, B requested for reduction which she refused, so B backed out of the sale. She returned the 50K to B through Oya. Thus this case filed by B for specific performance and damages Sps Lu contend that Pacita obtained loans from B, reaching 50K, so B without the knowledge of pacitas husband agreed to transform it into contract to sell of 2 lots, w/50K as downpayment. B backed out of the sale when Lu refused to reduce the price. Prop being conjugal, sale void. SLDC filed motion for intervention. SLDC contends that Sps. Lu executed on Feb 1989 an Option to Buy (option money = 316,160) out of 1.2M price. After Sps. received a total of 632,320, they executed on May 3, 1989 a Deed of Abs. Sale w/ Mortgage. Titles delivered were clean, so buyer in good faith. RTC: (in favor of SLDC) applying 1544, since both buyers didnt register sales, ownership should pertain to buyer who first acquired possession. DOAS in favor of SLDC sufficient delivery CA: (in favor of B) SLDC purchaser in bad faith SLDC contends that it bought prop w/o lien/encumbrance recorded in props titles. Also, B was not in possession. It had no prior notice of sale to B when it advanced 200K check in favor of B upon Pacitas representation that she needed money to pay B. After execution of sale, it took possession of the prop. Notice of lis pendens annotated June 2, 1989; sale to SLDC consummated May 3, 1989 B contends that SLDC in bad faith because at the time it registered the sale in its favor, theres already a notice of lis pendens ISSUE: Who bet B and SLDC has better right over the lots HELD: SLDC Agreement bet B and Sps. Lu contract to sell. Subsequent act of parties show that sps never intended to transfer ownership to B except upon full payment. In Bs letter to Pacita, B requested for the execution of DOS so he could pay balance, in effect recognizing that ownership of prop would not be transferred to him until

payment. Also, if they intended to transfer title, they could have executed DOS. B should have consigned the balance. Letter + intention to pay = not valid tender of payment. Thus, Lus obligation to convey title never acquired obligatory force. Sale is not a mode of transferring ownership, but merely a title. Delivery may be actual or constructive (ex. Execution of public instrument, symbolical tradition ie. delivery of key where movable is kept, buyer already in possession prior to sell). B didnt acquire ownership by mere execution of receipt bcoz it was not embodied in public instrument

PAJUNAR v CA [175 SCRA 464 (July 19, 1989)] Nature: Petition for certiorari to review the decision of the CA. Ponente: J. Paras Facts: Initial case for recovery of personal property with writ of replevin filed by Arthur and Invencia Pajunat with the RTC. RTC dismissed and CA affirmed. 1969: Respondents Mauro and Teofila Eluna bartered a 3-year old male cow for a 1-year old female carabao in the possession of Enopia; carabao had the brand ART in front and hind legs. Mauro did not or could not register the transfer to him. March 1980: Arthur Pajunar learned that the carabao was in the possession of Mauro. He claims that he is the original owner of the carabao which got lost in 1974. Arthur demanded the return of the carabao and the delivery of its 2 offsprings. Mauro refused to do so despite repeated demands and filed the initial case. Petitioner contends: Mauro failed to establish his ownership over the mestisa carabao found in his possession. Failure of Mauro to register in his name said carabao, constitutes a flaw in his ownership as required by law. Respondent claims: he has been in possession of the carabao for more than 10 years, by wirtue of barter with Enopia in 1969. Hence, he acquired ownership by prescription under NCC 1132. Issue: WON the transfer to Mauro of the carabao by barter was valid. Held/Ratio: No. Although the animal was branded ART at the time she was acquired by Mauro, said respondent did not or could not register the transfer to him in accordance with Sec. 529 of the Revised Administrative Code, which requires registration in order for a transfer to be valid. Mauro was not able to comply with this requirement. They are not possessors in good faith as a possessor in good faith is one not aware of that there exists in his title or mode of acquisition any flaw that invalidates it.

The duty to make a close inquiry into the certificate of registration of the carabao should have been performed by Mauro but he failed to do so. Thus, proving, he was in bad faith when he acquired the said carabao from Enopia. The possession in good faith for 4 years is NOT applicable, neither can possession in bad faithof 8 years benefit respondent, for when the owner of a movable has lost or has been illegally deprived of his property, he can recover the same without need to reimburse the possessor (NCC 559). Art. 716 cannot apply since it evidently refers to a possessor in bad faith. Dispositive: Decision reversed and set-aside.