The Mirror Doctrine

The general rule is that a purchaser may be considered a purchaser in good faith when he has examined
the latest certificate of title. An exception to this rule is when there exist important facts that would create
suspicion in an otherwise reasonable man to go beyond the present title and to investigate those that
preceded it. Thus, it has been said that a person who deliberately ignores a significant fact which would
create suspicion in an otherwise reasonable man is not an innocent purchaser for value. A purchaser cannot
close his eyes to facts which should put a 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 as has been held in other cases,
if the buyer fails to take the ordinary precautions which a prudent man would have taken under the
circumstances, specially in buying a piece of land in the actual, visible and public possession of another
person, other than the vendor, constitutes gross negligence amounting to bad faith.
In this connection, it has been held that where, the land sold is in the possession of a person other than the
vendor, the purchaser is required to go beyond the certificate of title to make inquiries concerning the rights
of the actual possessor. Failure to do so would make him purchaser in bad faith.
One who purchases real property which is in the actual possession of another should, at least make some
inquiry concerning the right of those in possession. The actual possession by a person other than the
vendor should, at least put the purchaser upon inquiry. He can scarcely, in the absence of such inquiry, be
regarded as a bona fide purchaser as against such possessors. (Lucena vs. CA, G.R. No. 77468, August
25, 1999).
Being a corporation engaged in the business of buying and selling real estate, it was gross negligence on its
part to merely rely on the sellers assurance that the occupants of the property were mere squatters
considering that it had the means and the opportunity to investigate for itself the accuracy of such
information. (Amancio, et al. vs. CA, et al., G.R. No. 152627, September 16, 2005).

Rules On Double Sale Of Immovables

In double sale of an immovable, the rules of
preference are as follows:
(a)

the first registrant in good faith;

(b)

should there be no entry, the first in possession in good faith; and

(c)

in the absence thereof, the buyer who presents the oldest title in good faith. (Martinez vs. CA, 358

SCRA 38 (2001); Art. 1544, NCC).

Prior registration of the subject property does not by itself confer ownership or a better right over the
property. Article 1544 requires that before the second buyer can obtain priority over the first, he must show
that he acted in good faith throughout (i.e., in ignorance of the first sale and of the first buyers rights) from
the time of acquisition until the title is transferred to him by registration or failing registration, by delivery of
possession. (Uraca vs. CA, 344 Phil 253; Consolidated Rural Bank (Cagayan Valley) Inc. vs. CA, et al, G.R.
No. 132161, January 17, 2005).
One who purchases real property which is in actual possession of others should, at least, make some
inquiry concerning the rights of those in possession. The actual possession by people other than the vendor
should, at least, put the purchaser upon inquiry. He can scarcely, in the absence of such inquiry, be
regarded as a bona fide purchaser as against such possessions. (Rep. vs. CA, 102 SCRA 331; Conspecto
vs. Fuerto, 31 Phil. 144). 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 vendors title takes all the risks and losses consequent
to such failure. (Caram vs. Laureta, 103 SCRA 16 [1981]; Consolidated Rural Bank (Cagayan Valley) Inc. vs.
CA, et al, G.R. No. 132161, January 17, 2005; see also Sps. Mathay vs. Court of Appeals, 356 Phil. 870
[1998]).
Registration of the second buyer under Act 3344, providing for the registration of all instruments on land
neither covered by the Spanish Mortgage Law nor the Torrens System (Act 496), cannot improve the
standing of a party since Act 3344 itself expresses that registration thereunder would not prejudice prior
rights in good faith (see Carumba vs. Court of Appeals, 31 SCRA 558). Registration, however, by the first
buyer under Act 3344 can have the effect of constructive notice to the second buyer that can defeat his right
as such buyer in good faith (see Arts. 708-709, Civil Code; see also Revilla vs. Galindez, 107 Phil. 480;
Taguba vs. Peralta, 132 SCRA 700). Art. 1544 has been held to be inapplicable to execution sales of
unregistered land, since the purchaser merely steps into the shoes of the debtor and acquires the latters
interest as of the time the property is sold. (Carumba vs. Court of Appeals, 31 SCRA 558; see also Fabian
vs. Smith, Bell & Co., 8 Phil. 496), (Remalante vs. Tibe, 158 SCRA 138; Sps. Noel & Julie Abrigo vs. De
Vera, G. R. No. 154409, June 21, 2004).

Ownership Is Reserved In A Contract To Sell

In a contract to sell, ownership is retained by a seller and is not to be transferred to the vendee until full
payment of the price. Such payment is a positive suspensive condition, the failure of which is not a breach of
contract but simply an event that prevents the obligation from acquiring binding force. (Heirs of Pedro
Escanlas vs. CA, 281 SCRA 176 (1997).
In a contract of sale, the non-payment of the price is a resolutory condition which extinguishes the
transaction that, for a time, existed and discharges the obligation created under the transaction. A seller
cannot unilaterally and extrajudicially rescind a contract of sale unless there is an express stipulation

authorizing it. In such case, the vendor may file an action for specific performance or judicial rescission.
(Benito vs. Saguitan-Ruiz, 394 SCRA 250 (2002); Heirs of Jesus Mascuana vs. CA, et al., G.R. No.
158646, June 23, 2005).

Right Of Legal Redemption

In Cabales, et al. v. CA, et al., G.R. No. 162421, August 31, 2007, a property was the subject of coownership. The co-owners sold their undivided shares in 1978 and informed the others, like Nelson, a minor
of the same in 1993. He signified his intention to redeem the subject property during a barangay conciliation
process but filed an action for legal redemption only in 1995. Can he still exercise the right of redemption?
Why?
ANS: No, because he did it beyond the 30-day period from the time he learned about the sale. (Art. 1088 &
1623, NCC; Alonzo v. IAC, L-72873, May 28, 1987, 150 SCRA 259).
To require strict proof of written notice of the sale would be to countenance an obvious false claim of lack of
knowledge thereof, thus commending the letter of the law over its purpose, i.e., the notification of
redemptioners.
There was sufficient notice of the sale to Nelson. The thirty-day redemption period commenced in 1993,
after Nelson sought the barangay conciliation process to redeem his property. By January 12, 1995, when
he filed a complaint for legal redemption and damages, it is clear that the thirty-day period had already
expired. (Cabales, et al. v. CA, et al., G.R. No. 162421, August 31, 2007).

Right Of Redemption
If a prospective redemptioner is informed of the sale of a portion of a property subject of co-ownership, he
has to exercise the right of legal redemption within 30 days from notice, otherwise, he loses the right. If he
was informed in 1993 but filed a complaint for legal redemption in 1995, then, he has lost his right to
exercise. To require strict proof of written notice of the sale would be to countenance an obvious false claim
of lack of knowledge thereof, thus, commending the letter of the law over its purpose, i.e., the notification of
redemptioners. (Cabales, et al. v. CA, et al., G.R. No. 162421, August 31, 2007. Puno, C. J).
If a property subject of co-ownership is sold and is redeemed in its entirety by one of the co-owners, does
the redemptioner acquire sole ownership? Why?
ANS: No. A co-owner who redeemed the property in its entirety did not make her the owner of all of it. The
property remained in a condition of co-ownership as the redemption did not provide for a mode of
terminating a co-ownership. (Paulmitan v. CA, G.R. No. 61584, November 25, 1992, 215 SCRA 867; Adille
v. CA, 157 SCRA 455 (1988)). But the one who redeemed had the right to be reimbursed for the redemption
price and until reimbursed, holds a lien upon the subject property for the amount due. Necessarily, when
one redeemed for others who had then acquired his pro-indiviso share in subject property, it did not vest in

her ownership over the pro-indiviso share she redeemed. But he had the right for the amount due until
reimbursement. The result is that the heirs retained ownership over their pro-indiviso share. (Cabales, et al.
v. CA, et al., G.R. No. 162421, August 31, 2007).