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G.R. No.

78903 February 28, 1990

SPS. SEGUNDO DALION AND EPIFANIA SABESAJE-DALION, petitioners,
vs.
THE HONORABLE COURT OF APPEALS AND RUPERTO SABESAJE,
JR., respondents.

Francisco A. Puray, Sr. for petitioners.

Gabriel N. Duazo for private respondent.

MEDIALDEA, J.:

This is a petition to annul and set aside the decision of the Court of Appeals rendered on
May 26, 1987, upholding the validity of the sale of a parcel of land by petitioner Segundo
Dalion (hereafter, "Dalion") in favor of private respondent Ruperto Sabesaje, Jr.
(hereafter, "Sabesaje"), described thus:

A parcel of land located at Panyawan, Sogod, Southern Leyte, declared in
the name of Segundo Dalion, under Tax Declaration No. 11148, with an
area of 8947 hectares, assessed at P 180.00, and bounded on the North,
by Sergio Destriza and Titon Veloso, East, by Feliciano Destriza, by
Barbara Bonesa (sic); and West, by Catalino Espina. (pp. 36-37, Rollo)

1
The decision affirms in toto the ruling of the trial court issued on January 17, 1984,
the dispositive portion of which provides as follows:

WHEREFORE, IN VIEW OF THE FOREGOING, the Court hereby
renders judgment.

(a) Ordering the defendants to deliver to the plaintiff the parcel of land
subject of this case, declared in the name of Segundo Dalion previously
under Tax Declaration No. 11148 and lately under Tax Declaration No.
2297 (1974) and to execute the corresponding formal deed of
conveyance in a public document in favor of the plaintiff of the said
property subject of this case, otherwise, should defendants for any
reason fail to do so, the deed shall be executed in their behalf by the
Provincial Sheriff or his Deputy;

(b) Ordering the defendants to pay plaintiff the amount of P2,000.00 as
attorney's fees and P 500.00 as litigation expenses, and to pay the
costs; and

(c) Dismissing the counter-claim. (p. 38, Rollo)

The facts of the case are as follows:

On May 28, 1973, Sabesaje sued to recover ownership of a parcel of land, based on a
private document of absolute sale, dated July 1, 1965 (Exhibit "A"), allegedly executed
by Dalion, who, however denied the fact of sale, contending that the document sued upon
is fictitious, his signature thereon, a forgery, and that subject land is conjugal property,
which he and his wife acquired in 1960 from Saturnina Sabesaje as evidenced by the
"Escritura de Venta Absoluta" (Exhibit "B"). The spouses denied claims of Sabesaje that
after executing a deed of sale over the parcel of land, they had pleaded with Sabesaje,
their relative, to be allowed to administer the land because Dalion did not have any
means of livelihood. They admitted, however, administering since 1958, five (5) parcels
of land in Sogod, Southern Leyte, which belonged to Leonardo Sabesaje, grandfather of
Sabesaje, who died in 1956. They never received their agreed 10% and 15% commission
on the sales of copra and abaca, respectively. Sabesaje's suit, they countered, was
intended merely to harass, preempt and forestall Dalion's threat to sue for these unpaid
commissions.

From the adverse decision of the trial court, Dalion appealed, assigning errors some of
which, however, were disregarded by the appellate court, not having been raised in the
court below. While the Court of Appeals duly recognizes Our authority to review matters
even if not assigned as errors in the appeal, We are not inclined to do so since a review
of the case at bar reveals that the lower court has judicially decided the case on its
merits.

As to the controversy regarding the identity of the land, We have no reason to dispute
the Court of Appeals' findings as follows:

To be sure, the parcel of land described in Exhibit "A" is the same
property deeded out in Exhibit "B". The boundaries delineating it from
adjacent lots are identical. Both documents detail out the following
boundaries, to wit:

On the North-property of Sergio Destriza and Titon Veloso;

On the East-property of Feliciano Destriza;

On the South-property of Barbara Boniza and

On the West-Catalino Espina.

(pp. 41-42, Rollo)

The issues in this case may thus be limited to: a) the validity of the contract of sale of a
parcel of land and b) the necessity of a public document for transfer of ownership
thereto.

The appellate court upheld the validity of the sale on the basis of Secs. 21 and 23 of
Rule 132 of the Revised Rules of Court.

SEC. 21. Private writing, its execution and authenticity, how proved.-
Before any private writing may be received in evidence, its due
execution and authenticity must be proved either:

(a) By anyone who saw the writing executed;

(b) By evidence of the genuineness of the handwriting of the maker; or

(c) By a subscribing witness

xxx xxx xxx

SEC. 23. Handwriting, how proved. — The handwriting of a person may be
proved by any witness who believes it to be the handwriting of such
person, and has seen the person write, or has seen writing purporting to
be his upon which the witness has acted or been charged, and has thus
acquired knowledge of the handwriting of such person. Evidence
respecting the handwriting may also be given by a comparison, made by
the witness or the court, with writings admitted or treated as genuine
by the party against whom the evidence is offered, or proved to be
genuine to the satisfaction of the judge. (Rule 132, Revised Rules of
Court)

And on the basis of the findings of fact of the trial court as follows:

Here, people who witnessed the execution of subject deed positively
testified on the authenticity thereof. They categorically stated that it
had been executed and signed by the signatories thereto. In fact, one of

such witnesses, Gerardo M. Ogsoc, declared on the witness stand that
he was the one who prepared said deed of sale and had copied parts
thereof from the "Escritura De Venta Absoluta" (Exhibit B) by which
one Saturnina Sabesaje sold the same parcel of land to appellant
Segundo Dalion. Ogsoc copied the bounderies thereof and the name of
appellant Segundo Dalion's wife, erroneously written as "Esmenia" in
Exhibit "A" and "Esmenia" in Exhibit "B". (p. 41, Rollo)

xxx xxx xxx

Against defendant's mere denial that he signed the document, the
positive testimonies of the instrumental Witnesses Ogsoc and Espina,
aside from the testimony of the plaintiff, must prevail. Defendant has
affirmatively alleged forgery, but he never presented any witness or
evidence to prove his claim of forgery. Each party must prove his own
affirmative allegations (Section 1, Rule 131, Rules of Court).
Furthermore, it is presumed that a person is innocent of a crime or
wrong (Section 5 (a), Idem), and defense should have come forward with
clear and convincing evidence to show that plaintiff committed forgery
or caused said forgery to be committed, to overcome the presumption of
innocence. Mere denial of having signed, does not suffice to show
forgery.

In addition, a comparison of the questioned signatories or specimens
(Exhs. A-2 and A-3) with the admitted signatures or specimens (Exhs. X
and Y or 3-C) convinces the court that Exhs. A-2 or Z and A-3 were
written by defendant Segundo Dalion who admitted that Exhs. X and Y
or 3-C are his signatures. The questioned signatures and the specimens
are very similar to each other and appear to be written by one person.

Further comparison of the questioned signatures and the specimens with
the signatures Segundo D. Dalion appeared at the back of the summons
(p. 9, Record); on the return card (p. 25, Ibid.); back of the Court
Orders dated December 17, 1973 and July 30, 1974 and for October 7,
1974 (p. 54 & p. 56, respectively, Ibid.), and on the open court notice of
April 13, 1983 (p. 235, Ibid.) readily reveal that the questioned
signatures are the signatures of defendant Segundo Dalion.

It may be noted that two signatures of Segundo D. Dalion appear on the
face of the questioned document (Exh. A), one at the right corner
bottom of the document (Exh. A-2) and the other at the left hand

1985. No. A contract of sale is a consensual contract. G. the execution thereof is equivalent to the delivery of the thing. 136 SCRA 365.. Delivery may either be actual (real) or constructive. The second signature is already a surplusage. an unnecessary one. It is not a requirement for the validity of a contract of sale of a parcel of land that this be embodied in a public instrument. Thus delivery of a parcel of land may be done by placing the vendee in . modification or extinction of real rights over immovable property must appear in a public instrument" (Art. 10) (pp. L-41605. 1498. the parties may reciprocally demand performance (Art. the vendee may compel transfer of ownership of the object of the sale.R. Buencamino. as well as to observe the demeanor of the witnesses while testifying in the case (Chase v. A-3). Rollo) We see no reason for deviating from the appellate court's ruling (p. No. Under Art. p. 44. 1475. L-20395. when the sale is made through a public instrument. Court of Appeals. and the vendor may require the vendee to pay the thing sold (Art.e. 42-43. 1985. This argument is misplaced. 1358 on the necessity of a public document is only for convenience. 138 SCRA 185) Assuming authenticity of his signature and the genuineness of the document. A forger would not attempt to forge another signature.R. NCC. No particular form is required for its validity. i. The trial court thus rightly and legally ordered Dalion to deliver to Sabesaje the parcel of land and to execute corresponding formal deed of conveyance in a public document.. margin thereof (Exh. Dalion nonetheless still impugns the validity of the sale on the ground that the same is embodied in a private document. Rollo) as we reiterate that Appellate courts have consistently subscribed to the principle that conclusions and findings of fact by the trial courts are entitled to great weight on appeal and should not be disturbed unless for strong and cogent reasons. NCC). May 13. transmission. Sr. not for validity or enforceability. par 1. NCC). 1358. August 19. and did not thus convey title or right to the lot in question since "acts and contracts which have for their object the creation. Pring v. NCC). for fear he may commit a revealing error or an erroneous stroke. since it is undeniable that the trial court is in a more advantageous position to examine real evidence. The provision of Art. 1458. (Decision. which means that the sale is perfected by mere consent. Upon perfection of the contract. G.

petitioner. We believe that the suit for recovery of ownership is proper. respondents.control and possession of the land (real) or by embodying the sale in a public instrument (constructive). and to observe a particular form. petitioner 1 filed a complaint against his father.R. 272. and the suit for recovery of ownership. A sale of a real property may be in a private instrument but that contract is valid and binding between the parties upon its perfection. Records) ACCORDINGLY. which is premised on the binding effect and validity inter partes of the contract of sale.: After his mother's death. . G. 1357). COURT OF APPEALS. Art. the petition is DENIED and the decision of the Court of Appeals upholding the ruling of the trial court is hereby AFFIRMED. ANTONIO J. 1475 of the Civil Code gives the parties to a perfected contract of sale the right to reciprocally demand performance. As regards petitioners' contention that the proper action should have been one for specific performance. HON.. to partition the conjugal properties of his parents. FINEZA. (Art. No costs. 1998 LEONCIO LEE TEK SHENG. Decision. MARTINEZ. 115402 July 15. if warranted. .. . merely seeks consummation of said contract. SO ORDERED. 2 In his answer with . 12.. and LEE TEKSHENG. The trial court. . No. (p. p. As earlier stated.. And a party may compel the other party to execute a public instrument embodying their contract affecting real rights once the contract appearing in a private instrument hag been perfected (See Art. aptly observed that Sabesaje's complaint sufficiently alleged a cause of action to compel Dalion to execute a formal deed of sale. vs. herein private respondent. J. 1357).

or cancelled except in a direct proceeding in accordance with law.D. Accordingly. to protect the interest of the conjugal regime during the pendency of the case. Though the postulates respectively proffered by both parties are not at point. He argues that his sole ownership as shown in the TCT would be improperly assailed in a partition case and should be done through a separate suit. There is no dispute that a Torrens certificate of title cannot be collaterally attacked 5 but that rule is not material to this case. private respondent prayed for the dismissal of the partition case and for the reconveyance of the lots to its rightful owner — the conjugal regime. 6 (Emphasis Supplied). Meantime. — A certificate of title shall not be subject to collateral attack. 4 Resorting to this Court. private respondent caused the annotation of a notice of lis pendens on TCT 8278. otherwise. private respondent posits that evidence of ownership is admissible in a partition case as this is not a probate or land registration proceedings where the court's jurisdiction is limited. On the contrary. The certificate referred to is that document issued by the Register of Deeds . The annotation of a notice of lis pendens does not in any case amount nor can it be considered as equivalent to a collateral attack of the certificate of title for a parcel of land. modified. luckily for private respondent. private respondent alleged that four (4) parcels of land registered solely in petitioner's name under Transfer Certificate of Title (TCT) 8278 are conjugal properties. the latter was then the only Filipino citizen in the family.counterclaim. petitioner's claim is not legally tenable. Private respondent contends that the lots are owned by the conjugal regime but was registered in petitioner's name only as a trustee considering that at that time. (b) it would amount to a collateral attack of his title obtained more than 28 years ago. Petitioner moved for the cancellation of said annotation which was denied by the trial court ruling that (a) the notice was not for the purpose of molesting or harassing petitioner and (b) also to keep the property within the power of the court pending litigation. but to no avail. petitioner primarily contends that in the resolution of an incidental motion for cancellation of the notice of lis pendens (a) it was improper to thresh out the issue of ownership of the disputed lots since ownership cannot be passed upon in a partition case. It cannot be altered. What cannot be collaterally attacked is the certificate of title and not the title. 1529 which states that: Certificate not Subject to Collateral attack. The concept of no collateral attack of title is based on Section 48 of P. 3 Petitioner assailed the denial of his motion to cancel the notice of lis pendens via petition for certiorari and prohibition to the Court of Appeals (CA).

9 What the latter disputes is the former's claim of sole ownership. suffice it to say that until and unless ownership is definitely resolved. The lower court allowed the annotation pending litigation only for the purpose of giving information to the public that parcel of land is involved in a suit and that those who deal with the property is forewarned of such fact. the law refers to ownership which is represented by that document. Thus. On the contention that ownership cannot be passed upon in a partition case. 10 yet contrary to his argument. But whether as a matter of procedure 12 or substance. registration is not the equivalent of title. Placing a parcel of land under the mantle of the Torrens system does not mean that ownership thereof can no longer be disputed. or. Neither ground for cancellation of the notice was convincingly shown to concur in this case. serving as a warning that one who acquires an interest over said property does so at his own risk. By title. Petitioner apparently confuses certificate with title. 11 It should be noted that what is being challenged in this case is the denial of the motion to cancel the notice of lis pendens. Ownership is different from a certificate of title. the parties are still locked in a legal battle to settle their respective claims of ownership. it does not bar private respondent from questioning his ownership. which are: (1) if the annotation was for the purpose of molesting the title of the adverse party. It must be emphasized that the annotation of a notice of lis pendens is only for the purpose of announcing "to the whole world that a particular real property is in litigation. known as the Transfer Certificate of Title (TCT). 8 Mere issuance of the certificate of title in the name of any person does not foreclose the possibility that the real property may be under co-ownership with persons not named in the certificate or that the registrant may only be a trustee or that other parties may have acquired interest subsequent to the issuance of the certificate of title. (2) when the annotation is not necessary to protect the title of the party who caused it to be recorded. contrary to petitioner's fears. 7 Besides. his certificate of title is not being assailed by private respondent. although petitioner's certificate of title may have become incontrovertible one year after issuance." 14 Here. it would be premature to . To repeat. The TCT is only the best proof of ownership of a piece of land. or that he gambles on the result of the litigation over said property. but is only the best evidence thereof. 13 a notice of lis pendens may be cancelled only on two grounds. Title as a concept of ownership should not be confused with the certificate of title as evidence of such ownership although both are interchangeably used. the certificate cannot always be considered as conclusive evidence of ownership. In this case. It would not even be fair to justify the cancellation of the notice on the legally untenable grounds that such annotation amounts to a collateral attack of petitioner's certificate of title or that ownership cannot be adjudicated in a partition case.

FRANCISCA S. 19Considering that this is a partition case. an action for partition is one case where the annotation of a notice of lis pendens is proper. the court is required to inquire into the "nature and extent of title" of the supposed claimant. 17 Further. J. David for respondents. Accordingly. private respondent in his answer with counterclaim prayed for the reconveyance of the disputed lots. BOMBASI.D. the petition is DENIED and the assailed decision of the Court of Appeals is AFFIRMED. respondents-appellees. Gonzalo D. 20 The title referred to by the rule is the purported ownership of the claimants and not the certificate of title mentioned in Section 48 of P. therefore. 1979 REPUBLIC OF THE PHILIPPINES. AQUlNO. Nos. 18 In addition. WHEREFORE.effect partition of the property. DEO. vs.: These two cases are about the cancellation and annulment of reconstituted Torrens titles whose originals are existing and whose reconstitution was. L-46626-27 December 27. 1529. FRUCTUOSA LABORADA and REGISTER OF DEEDS OF CALOOCAN CITY. Office of the Solicitor General for petitioner. SO ORDERED. . uncalled for. there is nothing in the rules which requires the party seeking annotation to prove that the land belongs to him.R. the issue of ownership has been put in issue and each claimant must present their respective evidence to substantiate their respective allegations. contrary to petitioner's argument. 16 Besides. G. petitioner-appellant. by virtue of the foregoing. HERCULINO M. COURT OF APPEALS. A & A TORRIJOS ENGINEERING CORPORATION. although the latter may be considered in the determination of the former. 15 For purposes of annotating a notice of lis pendens. one of the issues agreed upon by the parties at pre-trial is to determine what are the properties acquired by the spouses during their marriage.

The registers of deeds of Caloocan City and Rizal were not served with copies of the petition and notice of hearing.1. Rizal. Manila. a widow residing at 1665 Interior 12 Dart Street. Transfer Certificates of Title Nos. They were not destroyed during the war. Judge Serafin Salvador in his "decision" dated July 6. 915 and 918 of the Tala Estate. The notice of hearing was published in the Official Gazette. Consolidated Record on Appeal). Aquino (48-52. Caloocan. 915. Lots Nos. 2. Even the originals of the preceding cancelled titles for those two lots. C-677). with areas of more than twenty-five and twenty-four hectares. filed in the Court of First Instance of Rizal at Caloocan City a petition dated November. . 34594 and 34596 of the Registry of Deeds of Rizal both dated April 30. 5. She alleged that she was the owner of the lot and that the title covering it. 3." or not available (Civil Case No. 915 was covered by a transfer certificate of title which was not available and which was issued to Maria Bueza who sold the lot to Laborada. Consolidated Record on Appeal). as shown in Transfer Certificates of Title Nos. 4. are registered in the name of the Commonwealth of the Philippines. On April 2. the lower court issued an order setting the petition for hearing on June 14. 1967 before Manila notary Domingo P. The transfer certificate of title covering the lot was allegedly destroyed during the war. Consolidated Record on Appeal). The reconstitution proceeding started when Fructuosa Laborada. 1968.A. 915 in the name of Laborada. did not oppose the petition. namely. Laborada presented her evidence before the deputy clerk of court. located at Novaliches. It became final and executory. The originals of those titles are on file in the registry of deeds in Pasig. Cube. Copies thereof were posted in three conspicuous places in Caloocan City and were furnished the supposed adjoining owners (53-54. 1968 granted the petition. State Prosecutor Enrique A. 1938. 1967 for the reconstitution of the title covering the above-mentioned Lot No. 15832 and 15834 in the name of the Philippine Trust Company. the number of which she could not specify. The order of reconstitution was not appealed. 1968. The plan and technical description for the lot were approved by the Commissioner of Land Registration who recommended favorable action on the petition (pp. was "N. The petition was sworn to on November 16. He found that Lot No. The lower court directed the register of deeds of Caloocan City to reconstitute the title for Lot No. respectively. Paco. now Quezon City. as supposed counsel for the Government. 53-56. are intact in the registry of deeds.

9. single. In another and later case. Enrique A. 61-83. Malate.) 3-(R) Lot No. It was not opposed by the government lawyers. 10.6. 918. Consolidated Record on Appeal). The owner's duplicate of Gollez's title was supposedly destroyed during the war. But no copies of the petition and notice of hearing were served upon the registers of deeds of Caloocan City and Rizal. (17-21. The court found from the evidence that the allegedly missing or "not available" title was issued to Regino Gollez who sold the land to petitioner Bombast. Acting on the court's directive. 30257 to 30263 (pp. Why it was not filed simultaneously with Laborada's petition was not explained. the officials who would be interested in the reconstitution of the supposed lost title and who could certify whether the original of the title was really missing. 1967 for the reconstitution of the title of another lot. The register of deeds cancelled TCT No. (N. Taxes were paid for that land by Gollez and Bombast.A. before Manila notary Domingo P. The technical description of the land the plan were approved by the Commissioner of Land Registration who submitted a report recommending the reconstitution of the title (pp. She claimed to be the owner of the lot and that the title covering it was destroyed during the war. the register of deeds . The lower court ordered the register of deeds to reconstitute the missing title of Lot No. Aquino. the aforementioned Lot No. Cube and Conrado de Leon. 915 was later subdivided into seven lots. (N. 1969 granted the petition. Lots Nos. Bombast. Acting on that directive. Civil Case No. the register of deeds issued to Laborada on August 14. 7. 1967. The Acting Commissioner of Land Registration approved the subdivision plan. She alleged that the title was "N. one Francisco S. As in Laborada's petition.A. 22-25.) 8. Consolidated Record on Appeal). She could not specify the number of the title.A" or not available. 1968 seven titles to Laborada. 918 in the name of Bombast.) 3-(R) and issued on October 15. 56-59. The lower court set the second petition for hearing on January 31. namely. Consolidated Record on Appeal). 1969. It was posted in three conspicuous places in Caloocan City and copies thereof were sent to the supposed adjoining owners (22. Judge Salvador in his order of April 3. November 16. the notice of hearing for Bombast's petition was published in the Official Gazette. 915-A to 915-G. Bombast's petition was assigned also to Judge Salvador. Like the first petition. the second petition was sworn to on the same date. Consolidated Record on Appeal. TCT Nos. 1968 Transfer Certificate of Title No. Manila filed in the lower court a petition dated November 16. C-763 of the lower court. residing at 2021 San Marcelino Street.

10-11. 1970. On May 25 and 26. 4(R) dated August 27. whose reconstitution he had ordered allegedly in conformity with law. which was the same address used by Fructuosa Laborada (Bombast used first the address 2021 San Marcelino Street) sold Lot No. 12. "the reconstituted titles and their derivatives have the same validity. the State filed two petitions for the cancellation and annulment of the reconstituted titles and the titles issued subsequent thereto (Civil Cases Nos. Consolidated Record on Appeal). N. 1970 restraining orders enjoining the register of deeds. 1969(pp. filed separate answers containing mere denials. city engineer and Commissioner of Land Registration from accepting or recording any transaction regarding Lots Nos. 29-34. .880. respondents corporation and Laborada filed amended answers wherein they pleaded the defense that they were purchasers in good faith and for value. Judge Salvador. 918 to Herculano M. The respondents in the two cases. The State appealed. 13. consequently. who had ordered the reconstitution of the titles and to whom the two cases for cancellation were assigned. Deo allegedly for P249. 11. Transfer Certificate of Title No. force and effect as the originals before the reconstitution" (pp. therefore. through a common lawyer. now Identified as single (not widow) and a resident of 1665 Interior 12 Dart Street Paco. 1972. Judge Salvador further held that the titles. On June 22. 14. 1784 and 1785).issued to Bombast Transfer Certificate of Title No. their titles are not cancellable and annullable. After a joint trial of the two cases. On March 25. Manila.A. Judge Salvador (who did not bother to inhibit himself) rendered a decision in the two cases holding that the State's evidence was insufficient to establish its ownership and possession of Lots Nos.000. 915 and 918 and that Laborada and A & A Torrijos Engineering Corporation were purchasers in good faith and for value and. On October 28. 1969. The Commissioner of Land Registration filed pro forma answers wherein he interposed no objection to the issuance of the preliminary injunction sought by the State. 34147-R was issued to the corporation (pp. Deo sold the lot to A & A Torrijos Engineering Corporation allegedly for P250. 24-27. could not be attacked collaterally and. issued on June 5. 160-161. Francisca Bombast. Consolidated Record on Appeal). Transfer Certificate of Title No. 34146R was issued to Deo. 1969 or five months before the issuance of the reconstituted title. 915 and 918. Consolidated Record on Appeal).

as the party that made possible the reconstitution. It is a patent absurdity to reconstitute existing certificates of title that are on file and available in the registry of deeds. 1968 and April 3. C- . The State appealed to this Court. The reconstitution proceedings in Civil Cases Nos. The two proceedings were sham and deceitful and were filed in bad faith. L. although issued with judicial sanction. That kind of reconstitution was a brazen and monstrous fraud foisted on the courts of justice. it should be stated that the reconstitution proceedings. 26 provides for a special procedure for the reconstitution of Torrens certificates of title that are missing and not fictitious titles or titles which are existing. to which no importance was attached by the lower court and the Fifth Division of the Court of Appeals (Reyes. 915 and 918 ipso facto nullified the reconstitution proceedings and signified that the evidence in the said proceedings as to the alleged ownership of Laborada and Bombast cannot be given any credence. 1970.). Republic Act No. is that two valid and existing Torrens titles in the name of the Commonwealth of the Philippines were needlessly reconstituted in the names of Laborada and Bombast on the false or perjurious assumption that the two titles were destroyed during the war. the State.B. Such humbuggery or imposture cannot be countenanced and cannot be the source of legitimate rights and benefits. and that if there were irregularities in the reconstitution. The crucial and decisive fact. We hold that the appeal is justified.15. The Court of Appeals cited section 101 of Act 496 to support its view that a registered owner may lose his land "by the registration of any other person as owner of such land". Civil Cases Nos. in affirming the lower court's judgment. In all candor. The Appellate Court and the trial court grievously erred in sustaining the validity of the reconstituted titles which. then. The Court of Appeals. JJ. should suffer the loss. 1969 could no longer be set aside on May 26. as between two innocent parties. One and the same judge (1) allowed the reconstitution and then (2) decided the two subsequent cases for the cancellation and annulment of the wrongfully reconstituted titles. C- 677 and C-763. held that the orders of reconstitution dated July 6.. The existence of the two titles of the Government for Lots Nos. were simply devices employed by petitioners Laborada and Bombast for landgrabbing or for the usurpation and illegal appropriation of fifty hectares of State-owned urban land with considerable value. are no better than spurious and forged titles. It was a stultification of the judicial process. Domondon and Ericta. when the petitions for annulment and cancellation of the reconstituted titles were filed.

Williams for appellee. 1914 MARIA DEL CONSUELO FELISA ROXAS Y CHUIDIAN. Southworth and Faison for appellants. May 31. Transfer Certificates of Title Nos. 1978. SO ORDERED. L-8539 December 24. objectors-appellants. The reconstitution proceedings in Civil Cases Nos. acts executed against the provisions of mandatory laws are void (Art. No. The theory of A & A Torrijos Engineering Corporation that it was a purchaser in good faith and for value is indefensible because the title of the lot which it purchased unmistakably shows that such title was reconstituted. petitioner-appellee. D. 3-(R) and N. 5. The register of deeds is directed to cancel the said titles. Court of Appeals. WHEREFORE. N. 4-(R) and Transfer Certificates of Title Nos. 26 and beyond the purview of that law since the titles reconstituted are actually subsisting in the registry of deeds and do not require reconstitution at all. 26 to be utilized as an instrument for landgrabbing (See Republic vs. 34147-R and 30257 to 30263 and the survey plans and subdivision plan connected therewith are likewise declared void.A. Ocampo and Anglo. The Republic of the Philippines. L-31303-04.A. ET AL.677 and C. To sustain the validity of the reconstituted titles in these cases would be to allow Republic Act No. C-677 and C-763 are declared void and are set aside. is hereby declared the registered owner of Lots 915 and 918 of the Tala Estate. 83 SCRA 453. 480. That circumstance should have alerted its officers to make the necessary investigation in the registry of deeds of Caloocan City and Rizal where they could have found that Lot 918 is owned by the State. Costs against the private respondents-appellees. RAFAEL ENRIQUEZ. Civil Code). vs. to undermine the stability and security of Torrens titles and to impair the Torrens system of registration. Santos) or to sanction fraudulent machinations for depriving a registered owner of his land. G. the decisions of the Court of Appeals and the trial court are reversed and set aside. 34594 and 34596 of the registry of deeds of Rizal. per J. The reconstituted titles.763 are void because they are contrary to Republic Act No.R. . As a rule. as the successor of the Commonwealth of the Philippines. 34146-R.S. R. G.. as shown in Transfer Certificates of Title Nos.

19 meters.817. presented a petition in the Court of Land Registration for the purpose of having registered. bounded on the north by Calle Escolta for 31. 94. Roxas for 66. 84. | | B to C | S. — It is a parcel of land with the buildings erected thereon.03 square meters as set forth in the attached plan. on the east by the estate of Pedro P. 44º 30' W | 31. 90." located at the vertex of the angle formed by the northeastern side of Calle Escolta and the corner of the Pasaje de Perez was selected as the basic point. on the south by the Pasig River for 25. all of which were located in the city of Manila. whence S. I. the said petitioner. located in the district of Binondo of this city between Nos. 92.: It appears from the record that on the 12th day of January. and 96 Calle Escolta and the northern bank of the Pasig River. Technical description. and on the west by the estate of the heirs of Antonio Enriquez for 62. chosen as the point of beginning for the topographical operations. 92. | in meters. 1906.JOHNSON. 27.08 | Calle Escolta. Parcel C.10 meters. J. II. 46º 15' E | 16.08 meters.15 | Heirs of Antonio | | C to D | S. 90. 49º 40' W. located in the district of Binondo of this city between Nos.75 meters is located Point A..75 | } Enriquez. 42º 00' E | 32. | degrees. the result whereof is as follows:1awphil. | . four parcels of land. 94. with an area of 1. | | —————————————————————————————————— | A to B | S. From an examination of said petition we find that parcel A was described generally and technically.net —————————————————————————————————— | Points or | Directions in | Distances | Boundaries | | stations.48 meters. and 96 Calle Escolta and the northern bank of the Pasig River. General description. Parcel B. known as Parcel A. — The undersigned on the 26th of the present month proceeded to survey and fix the boundaries for preparing the topographical plan of a lot occupied by buildings of strong materials one and two stories high belonging to Maria del Consuelo Roxas y Chuidian. The point marked on the plan with the letter "X. under the Torrens system. and Parcel D. Maria del Consuelo Felisa Roxas y Chuidian. The only one of said parcels to which attention need be given in the present appeal is Parcel A. 84.

03 square meters.92 | } Pedro P. but its importance to the questions presented will be discussed below. the estate of Pedro P. | | J to K | N. 44º.817. 30' W.. Attached to said petition was a number of documents presented as exhibits. The petition gives the names of said persons.08 meters. on the south. | | F to G | N. on the east. 40º 50' E | 13. 35º 45' W | 6. according to my information: . showing the chain of title of the petitioner. all the points specified are marked on the attached plan.25 | } Pasig River.56 | | | I to J | N. surnames. a distance of 31. 52º 00' E | 10. 42º 05' W | 25. 35º 00' W | 7. | D to E | S.. 49º 45' E | 14. the Pasig River." {bmc 029035a. and its boundaries are: on the north.90 | | | H to I | N. 50º 30' E | 1.08 meters.20 | | | E to F | N. and on the west.60 | | | K to A | N. and post-office addresses of the owners of the parcels of land conterminous with this estate are. Attention is called to this difference between the technical description and the plan at this time.50 | | —————————————————————————————————— The lot described has an area of 1. it will be noted that the line A-B in the technical description runs S. as follows: The names. The plan to which reference is made in the above technical description and which accompanied the petition is as follows and is marked "Exhibit A. 46º. the bearings are magnetic. Roxas. the estate of the heirs of Antonio Enriquez. while in the plan line A-B runs S. Calle Escolta. Roxas.bmp} By comparing the above technical description with the plan presented (Exhibit A).94 | | | G to H | N. We find that said petition contains a statement of the names of the adjoining owners of the land in question. 37º 10' W | 24. 30' W. and that the distance between A and B was 31.

No. Sousa. Pedro P. M. 1895. whose representatives are the attorneys Hartigan. 36. 149. 113. Calle Santo Tomas. all of the city of Manila. 142. A. the three on Calle Malacañang. Roxas. attorneys of the heirs of Antonio Enriquez. 226. Messrs. Rosendo Comas. Calle Jaboneros No. in which he sets out in detail the title of the petitioner to said Parcel A. 154. Gordillo and Martinez. No. Burke. and Enrique Somes. No. Intramuros. district of Intramuros.. Carmen Ayala de Roxas. Ramon Genato. who made a very careful examination of the title of the petitioner to the land in question. corner of Calle Cabildo. 140. Macke and Chandler and F. 14. Cheng Tao Sang. Solignac & Gutierrez. the Municipal Board of the city of Manila. issued the following notice: UNITED STATES OF AMERICA. 122. Salgado. Ang Seng Queng. Calle Alix No. Sing. Hartigan. and Maximo Cortes and Dolores Ochoa. and to all whom it may concern: . judge. Messrs. 496. No. the matter was referred to the examiner of titles of the Court of Land Registration. 34. Calle Lacoste No. 92. 94. 330. the plan. Court of Land Registration. these three of the district of Santa Cruz. San Miguel. Nos. Rohde & Gutierrez. these on Calle Escolta. Williams & Chandler. on the 23d day of March. A. and Lim Tinco. 28. Messrs. No. Upon the issue thus presented we find that the Honorable Simplicio del Rosario. 32. 1906.] To the Attorney-General of the Philippine Islands. Tomas Serreno. all these of the district of Binondo. these two on Calle Rosario. No. these two No. No. in accordance with the provisions of section 31 of Act No. in the name of the petitioner. district of Sampaloc. district of San Miguel. and Messrs. PHILIPPINE ISLANDS. No. upstairs. No. the recommends the registration of said Parcel A. 84-88. 7 Anda. Antonio Vy Chuico. as well as the other parcels. presented a very carefully prepared report. 200. 111.. these two No. Calle Dulumbayan No. Francisco Saez. Greilsammer Bros. Case No. and Candido Lim. [Registration of title. Manila. 1906. 154 Malacañang. No. 90. Calle Nueva No. I. Upon the presentation of said petition. and Gervasio Rosario Ventura. Plaza de Goiti No. as well as the others. Messrs. The heirs of Antonio Enriquez. Luciano Cordoba. and on the 5th day of March. and the documents showing the chain of title of the petitioner. Marple. No. No. Alfonso Tiaoqui. P. 96. 90 interior.

if any you have.20 m. and unless you appear at such court at the time and place aforesaid your default will be recorded and the said application will be taken as confessed. along the SE. N. by property of the heirs of Antonio Enriquez and NW. 2. to pt. 52º E.. "L". 31. N. to pt.. S. 14. end of the chaflan at the S. at 8 o'clock in the forenoon. N. "C".25 m. 53º 30' E. to pt. 17.. N. N. 40º 50' E. K. city of Manila. 14 m. more particularly bounded and described as follows: Parcel A. SW. through her attorney in fact Antonio Bonifas. del Rosario. S.. being S. "K". N. 1906. 46º 30' W. 38º 40' W. to pt. 59. and you will be forever barred from contesting said application or any decree entered thereon. 40º 05' W. by the Escolta.16 m. 49º 45' E. "H". to pt. 15. the clerk of the Court of Land Registration. Witness the Hon. to pt. "G".. S. marked "A" on plan. 46º 15' E. 10. sent a copy of said order to each of the persons mentioned therein. N. to pt. Manila. "D". 84-96.20 m.94 m. 32. to show cause. bank of the Pasig River. "M". Whereas an application has been presented to said court by Maria del Consuelo Felisa Roxas y Chuidian. 42º E.. I. district of Tondo. 1905. judge of said court.. 13. I. intersection of the Escolta and Pasaje de Perez... nineteen hundred and six. this 23d day of March in the year nineteen hundred and six. Bounded on the NE. The record shows that each of said persons received a copy of said notice.35 m. to register and confirm her title in the following described land: Four parcels of land with the improvements of strong materials thereon.. on the 28th day of March.15 m. "E" to "G" follow the NW. beginning at a pt. "B". Date of survey. line of the Escolta. to pt. P. to pt. 0. 27. "E". by the Pasig River.. 52º 35' E. "I". In accordance with said order of publication. SE. P. I. to pt. JONES. by property of Carmen Ayala de Roxas. You are hereby cited to appear at the Court of Land Registration to be held at the City Hall.. by registered mail. 4. to pt.30 m..12 m. Clerk of said Court.. city of Manila. 14. to pt. A.. on the 25th day of April. D.75 m. 36º 20' W.75 m.. — Situated on the Escolta Nos. 38º 50' W. Calzada de las Aguadas.27 m. 16. 49º 40' W. N. Attest: A. including the representative of the heirs of . to pt. why the prayer of said application shall not be granted. Calle Padre Herrera No. S. N. "J". December 26. from the W. situated in the district of Binondo. 44º W. P.08 m. "F".. thence S.

K. F. a notice referring to the application for registry No. presented by Antonio Bonifas. by the certificate of James J. A. The Manila Times on March 28. made the following certificate relating to the notice and to the publication of the notices required by section 31 of Act No. 1906. Maximo Cortes and Dolores Ochoa. in compliance with the order issued by said court. and notice was served upon the Attorney-General of the Philippine Islands. Sousa. The record further shows. Maria del Consuelo Felisa Roxas y Chuidian. UNITED STATES OF AMERICA. Alfonso Tiaoqui. the Municipal Board of the city of Manila. On the 17th day of April. was published once only in the daily newspapers of this city. 1906. Tomas Serrano. and Enrique Somes. sheriff of the city of Manila.Antonio Enriquez (Hartigan. I. and La Democracia on the 31st of the same month and year. JONES. Case No. Peterson. Burke. Ramon Genato. On the 19th day of April. M. Sing. COURT OF LAND REGISTRATION. Williams & Chandler. 1906. 1906. that said notice was posted upon the land in question. Macke & Chandler. Francisco Saez. 1906. And for the purposes of the necessary procedure. Gordillo & Martinez. Antonio Vy Chuico. Gervasia Rosario Ventura. A. the record shows that Modesto Reyes. Lim Tinco. K. as representative of Maria del Consuelo Felisa Roxas y Chuidian. I issue the present in Manila on the 17th day of April. K. Carmen Ayala de Roxas. certify that. Candido Lim. A. Hartigan. 496. Clerk of the Court. A. record) presented a written statement to the court calling its . Jones. Greilsammer Hermanos. Jones. Luciano Cordoba. PHILIPPINE ISLANDS. Ang Seng Queng. The record further shows that said notice had been published in two daily newspapers of the city of Manila. 1895. A. clerk of the Court of Land Registration. Cheng Tao Sang. 1895. Rohde & Gutierrez. by registered mail. 131. Rohde & Gutierrez). Rosendo Comas. a copy of said notice in Spanish having been sent to each one on March 28. Salgado. clerk of the Court of Land Registration of the Philippine Islands. attorney for the city of Manila (p. in English and Spanish respectively. Applicant. The Manila Times and La Democracia.

PHILIPPINE ISLANDS. Rosendo Comas. Carmen Ayala de Roxas. the hearing on the said petition was brought on for trial on the 25th day of April. At the hearing the petitioner was represented. Application of Maria del Consuelo Felisa Roxas y Chuidian for registration of the real estate described herein. Modesto Reyes. 1906. included in the original petition. So far as the record shows no correction whatever was made in the plan of said Parcel A. In view of said fact (the existence of errors) the court ordered that said errors be corrected. Alfonso Tiaoqui." On said date (April 25. Cheng Tao Sang. 1895. and asked the court to correct the error. Gervasia Rosario . Burke: Macke & Chandler. Francisco Saez. No. vs. the honorable Simplicio del Rosario. Ramon Geneto. The Attorney-General of the Philippine Islands. at 9 o'clock a. The said attorney also called the attention of the other plans of the other parcels of land. Lim Tinco. attorney for the city of Manila. Mr. Maximo Cortes and Dolores Ochoa. No one appeared to represent the "heirs of Antonio Enriquez. at the place mentioned in said notice. at 9 o'clock a. m. 1906. Reyes called the attention of the court again to the fact that there existed certain errors in the measurement of some of the sides of the plan presented by the petitioner. 1906. Gordillo & Martinez. Tomas Serrano. On the 21st day of July. the cause having been brought on for hearing. relating to said request of the attorney of the city of Manila. Salgado. Greilsammer Hermanos.attention to the fact that there existed an "error of closure" in the plan of said Parcel A. Luciano Cordoba. F. judge. Sing. Our attention has not been called to any order made by the lower court.. m. Hartigan. Mr. Rohde & Gutierrez. COURT OF LAND REGISTRATION.) the cause relating to said Parcel A was brought on for trial. M. the Municipal Board of the city of Manila. Antonio Vy Chuico. A. Williams & Chandler. appeared for the city of Manila. distated the following order or judgment in default against all persons: UNITED STATES OF AMERICA. Candido Lim. A. And Seng Queng. In accordance with said notice to all of the interested parties. Antonio Bonifas appeared for the petitioner and My. Sousa.

within the period fixed by the law. applicant. del Rosario. Whereas. one printed in the English language and another in the Spanish language. 1895. said clerk caused to be sent by registered mail. Whereas. Philippine Islands. Clerk of the Court. within seven days after the publication of the said notice. JONES. spinster. judge of the said Court of Land Registration. the clerk of this court caused to be published once only a notice in due from referring to the application mentioned. a copy thereof in the Spanish language to each one of the persons named in the application or who appeared to be concerned therein. all of the persons cited as defendants have failed to appear to impugn the application. this 21st day of July. in two newspapers of general circulation. and 119 days have elapsed since publication of said notice was effected. this court decrees that Maria del Consuelo Felisa Roxas y Chuidian. 1906. The present case having been duly tried. in Manila. Said decree was as follows: Having tried case No. before the fourteen days preceding that set for the termination of the period fixed. to wit. is the absolute . K. This court orders a declaration of default against all the defendants and other persons who may be concerned in opposing the application. of Manila. decreeing that said parcel of land. defendants. Whereas. Given by the Honorable S. Later the Honorable Simplicio del Rosario dictated the following order. A. and Whereas. and also in a conspicuous place in the principal municipal building of the city of Manila. Ventura. and whomsoever it may concern. be registered as the absolute property of Maria del Consuelo Felisa Roxas Y Chuidian. and La Democracia of the same city. which is granted. The Manila Times of this city. Attest: A. the sheriff of Manila posted in a conspicuous place on each of the parcels of land included in the application a certified copy of the notice in Spanish. and Enrique Somes.

..] (Sgd. All the points named are marked on the plan. thence N. by the Pasig River. thence N. to point F. to point K. subject however to any of the encumbrances set forth in section 39 of said Act that may be in force and effect. K. bounded on the NE.. thence N. nineteen hundred and six. Given by the Honorable S. having an area of 1.. to point H.owner of the real property. 0. thence S. to point J.. to point M. this twenty-first day of July. thence S. 40º 50' E. Attest: [SEAL. 38º 40' W.. Clerk of the Court.817...) A.. September 25. December 26. to point C... A copy of this decree was sent to the register of deeds of Manila.12 m. situated at Nos.16 m. the bearings are magnetic.. at eight o'clock and ten minutes ante meridian. by Calle Escolta. 14.. located in the city of Manila.75 m. in Manila. thence N.15 m.. 42º E. thence N. by the property of Carmen Ayala de Roxas.27 m. judge of the said Court of Land Registration. 49º 45' E. 14 m. Wherefore this court orders that the said real property be registered in accordance with the provisions of the Land Registration Act in the name of the aforesaid Maria del Consuelo Felisa Roxas y Chuidian. from the extreme W.94 m. to point D. 14. 1905.30 m. 36º 20' W. date of survey. 44º W. and on the NW..03 square meters.. thence S... 10. 32. . to point E. 49º 40' W. 17. thence N.08 m. to point of beginning. on the SE. by the property of the heirs of Antonio Enriquez.35 m. 16.. 84 to 96 Calle Escolta. to point L. 40º 05' W. 46º 30' W. on the SW. 52º 35' E.. thence N. 15. 13.. to point I. 2.. 38º 50' W. thence N. 46º 15' E. S.20 m. del Rosario..75 m.25 m. which point is 27. thence N. which is adjudicated to her. 53º 30' E. district of Binondo. to point G. Beginning at a point marked A on the plan. to point B. 1906. of the angle situated at the intersection S. and from said point A. S... 52º E. the description whereof is hereinafter set forth: A parcel of land. 31..20 m. Jones.... 4. of Calle Escolta and Passage de Perez.

On the 21st day of July. Smith. 1906. referred the petition of the city of Manila to the chief surveyor of . That the plan of the property with which the present case deals is affected by an error of closure greater than 1/1500. 1911. the honorable Charles H. II. 1911. and delivered to the petitioner the owner's duplicate. Case No. judge of the Court of Land Registration. I. On the 23d date of December. and the property became registered under the Torrens system. on the 21st day of July. MOTION. P. 1911. 1906. After the registration of said Parcel A in the name of the petitioner. in the name of the petitioner. nothing further seems to have been done in the Court of Land Registration until on or about the 19th day of December. through its undersigned attorney. which were included in the petition of the petitioner. COURT OF LAND REGISTRATION. I. the court issued the certificate of title known as No. 742.. and D). December 18. The city of Manila. Therefore. It is not clear whether said petition refers to the incorrections in the plan of Parcel A or to the incorrections in the plans of the other parcels of land (B. PHILIPPINE ISLANDS. That the city of Manila is interested in the correction of said error as it has to expropriate a portion of said land for use as a public street. comes now into the court and respectfully represents. applicant. Roxas y Cuyugan. nearly five years and a half after said land had been registered. C. when we find that the assistant attorney of the city of Manila filed the following petition: UNITED STATES OF AMERICA. 1895. Manila. the petitioner prays the court to order a new survey of said property described in the plan filed in this case.

district of Binondo. That on January 10. with the buildings erected thereon. the said surveyor reported to the court that there existed "errors of closure in said plans. the original petitioner. 2. in the name and representation of the applicant. 1895. 84 to 96 Calle Escolta. sought the legalization of property title to four estates. located at No. Maria del Consuelo Felisa Roxas y Chuidian. district of Binondo. 28 to 36 Calle Escolta. (b) Another parcel of land with the buildings erected thereon located at Nos. Maria del Consuelo Felisa Roxas y Chuidian. and it cannot therefore be included in the purpose of the present application. 1911. . corner of Callejon Carvajal.the court." On the 5th day of January. among them the following: (a) A parcel of land with the buildings erected thereon. located at Nos. in accordance with section 4 of Act No. Don Antonio Bonifas. 1875. 1906. On the 27th day of December. 222 to 230 Calle Rosario. so as to include the buildings upon the lands included in her petition. the judge of the Court of Land Registration ordered the chief surveyor to prepare new plans. district of Binondo. and directed that notice be given to the adjoining owners. applicant. PHILIPPINE ISLANDS. 1906. Said petition was as follows: UNITED STATES OF AMERICA. located at Nos. 1912. district of Binondo. presented a petition for the correction of the certificate issued to her on the 21st day of July. COURT OF LAND REGISTRATION: Case No. 149 Calle Nueva. Comes now the applicant into the Honorable Court of Land Registration and represents: 1. 1912. That the other estate mentioned in the said application refers to a parcel of land. On the 28th day of February. (c) Another parcel of land with the buildings erected thereon. which buildings were totally destroyed by the fire that occurred on the 2d of November of the year just past.

but averring that the amounts paid for those purposes are credited in the accounting division of the Court of . That in the notice to the Attorney-General. 472. which accompany this application. 4. in the estate designated by the letter (a). the Municipal Board. issued by the clerk of the court. consisting of two houses of strong materials. but the respective building on each was omitted. the tenants. but in the certificate of the decree or resolution under consideration. a house of stone and masonry in that designated by the letter (b).000 dollars United States currency. and the buildings at 15.020 dollars and 50 cents. adjudication and registration of the estates were ordered in applicant's favor in the terms set forth in the application. and the buildings at 5. one behind the other. 5. 6. and 743. October 9 and 22. the receipts and vouchers wherefore do not accompany this application because the applicant destroyed them in the belief that there was no need to exhibit them.500 dollars United States currency. and owners conterminous with the estates referred to therein. it appears that on the parcels of land which form part of the estates under consideration there are erected buildings. as assurance fund. that the land of the estate designated by the letter (b) was assessed at 55. That both in the property titles to the said estates and in the plans and technical descriptions thereof which accompany said application and are annexed to the above-entitled case.70 Philippine currency. That in the record of the register of deeds.000 dollars. Nos. the sum of P943. and in this form were issued the certificates of title.3. United States currency. That on January 12. That by decree of June 21. it appears that they consist of the parcels of land and the buildings stated. That in the said application it is stated that the land of the estate designated by the letter (a) was assessed at 65. 1906. September 21.072 dollars and 50 cents United States currency. and the buildings at 18. 1906. the rights of issuance of title and one-tenth of 1 per cent of the assessed valuation. and another house of stone and masonry in that designated by the letter (c). in the registration entries referring to the said estates. the buildings erected on them are likewise mentioned. the description of the parcel of land corresponding to each estate was given. 8. and the land of the estate designated by the letter (c) was assessed at 5. 7.658 dollars Unites States currency. United States currency. the legal representative of the applicant guaranteed by deposit. 764.

10. wherein record be made of the building erected on each. the applicant prays the honorable court to decree. she appeals to your honorable court with the request that you order the correction of said omission. MARIA DEL CONSUELO FELISA ROXAS Y CHUIDIAN. showing that on the 20th day of March. after the necessary legal proceedings. without modification or alteration. Manila. the same buildings that existed when legalization of title thereto was applied for and which appear in the titles of acquisition annexed to the above-entitled case. the same as in the certificates of title corresponding to the other two estates. That in view of what has been set forth and explained. especially as there at present exist on the said parcels of land. Land Registration and the office of the register of deeds. wherein are stated the two points mentioned. 1912. and interest in said Parcel A. Maria del Consuelo Felisa Roxas y Chuidian had sold all her rights. 9. . correction of the omission referred to by ordering the free issuance of a new certificate of title to each of the said estates. That for greater assurance and for the purpose of proving that the said estates consist not only in the parcel of land or lot but also in the building erected on each. the applicant attaches hereto the assessment or property-tax receipts for each of the said estates. 11. title. to the said Masonic Temple Association of Manila. reference whereto has been made in the third paragraph. consisting of those enumerated in the third paragraph of this application. as has been ascertained by a person delegated therefor by the applicant. Said Masonic Temple Association of Manila requested the judge of the Land Court to attach said contract to the record in the case and issue a new certificate to it. 1912. On the 9th of April. judge of the Court of Land Registration. which nevertheless greatly affects the applicant's right. the Masonic Temple Association of Manila sent a communication to Honorable Charles H. That when applicant attempted to alienate one of the estates mentioned she observed the omission in the corresponding certificate of title of the building existing thereon. and as it is to be supposed that said omission is due solely to a simple clerical error. including the buildings thereon. 1912. Smith. accompanied by a contract. February 28.

The nearest approach to a definite and specific statement of their objections appears in the argument of their counsel at the close of said several hearings. Said new plan is as follows (see page 48): After the presentation of said new or corrected plan. They presented no written statement in which their specific objections appear. sitting in banc. the motions: (a) That of the city of Manila to have corrected the error of closure in the original plan. in January. 1912. 1906. was presented. and (c) That of the Masonic Temple Association of Manila. B. on the . to have included in her certificate of title the buildings located upon the lands registered in accordance with her original petition. During said various hearings. Ostrand and the Honorable Norberto Romualdez. and his associates. certain proof was taken upon the question of the correctness of the original plan presented by the petitioner. Smith. Said new plan was made for the purpose of correcting the errors in closure in the original plan presented by the petitioner on the 10th day of January. the hearings on said motion were transferred from one date to another from the 22d of April. (b) That of Maria del Consuelo Felisa Roxas y Chuidian. the Honorable James A. During said hearings the heirs of Don Antonio Enriquez appeared and apparently made some objection to the granting of said motions. Hay. were set down for hearing. to have a certificate issued to it in accordance with its contract of purchase of said lands from Maria del Consuelo {bmc 029048. 1906. prepared by Mr. After hearing all of the parties. in which it appears that their objections to the correction of the original plan and certificate and the issuance of a new certificate to the Masonic Temple Association of Manila was based upon the ground that they claimed easements or servitudes in the land in the question. the Honorable Charles H. a new plan of said Parcel A. 1912. auxiliary judges of said court. 1911. surveyor of the Bureau of Lands. until the 24th of August. 1912. judge of the Court of Land Registration. in accordance with the order of the court of the 23d of December. For one reason or another. W. in addition to the appointment of a commission to view the premises.bmp} Felisa Roxas y Chuidian — after notice had been given to all the interested parties.On the 19th day of April.

3. Appellants now allege that it affirmatively appears that neither this firm nor any of its members represented the defendants and appellants in that action. for the reason that "the appellants had no notice of the pendency of the original action to confirm the title of said property.24th day of August. Ostrand. The record shows. or at least some of them. That the judgment of the court below is against the manifest weight of the evidence. In the argument of the appellants in support of their assignments of error. which is in controversy in this suit. On the 10th day of September. Smith. 742. After a careful examination of the argument of the appellants in support of each of said assignments of error. We have searched the record now in vain to find the slightest denial of the fact that they were the representatives of said heirs. and the case was appealed to this court. Rohde & (Marple?) Gutierrez. and that notice was duly sent to them." Appellants now admit that a notice of the pendency of the original action was sent to attorneys Hartigan. James A. we are of the opinion that they may be discussed together. by a unanimous decision. of Maria del Consuelo Felisa Roxas y Chuidian. that said attorneys were not the representation of the heirs of Don Antonio Enriquez at the time of the original . denied said motion. 2. sitting in banc. In this court the respondents presented the following assignments of error: 1. 1912. that the original petition showed that Hartigan. After a due consideration of said motion for a new trial and after hearing the respective parties. as we have pointed out above. composed of Charles H. 1906) is absolutely void. So far as the record shows there is not even a suggestion found in the various hearings and proceedings taken and had under the above motions. basing it upon the ground that the conclusions of the lower court were manifestly contrary to the proof. the attorneys for the objectors presented a motion for new trial. confirming the title to lot 4. Practically the whole argument of the appellants is based upon the ground that the original certificate (No. in the present proceedings. and Norberto Romualdez. and of the Masonic Temple Association of Manila. even though one of said attorneys represented them. That the court below erred in holding that the proceedings of the Court of Land Registration were valid in entering judgment in favor of the plaintiff and appellee. 1912. granted the motions of the city of Manila. issued July 21. Rohde & Gutierrez were the representatives of the heirs of Don Antonio Enriquez. the Court of Land Registration. there is but little argument against the decision of the court rendered on the 24th of August. 1912. That the judgment of the lower court is contrary to law.

It seems to directly contradict the requirements of personal notice as an absolute prerequisite to the granting of a valid title under the Torrens system. by that argument. 1912. 496. Said section 38 provides that: "Every decree of registration shall bind the land and quite the title thereto. the court may at once. no reason to the contrary appearing. It shall be conclusive upon and against all persons. It will be remembered that we noted above that personal notice of the pendency of the original petition had been given and that a publication of the same had been made in accordance with the provisions of sections 31 and 32 of Act No. The same idea is further confirmed by the provisions of section 38 of said Act No. and all the branches thereof. but may require other and further proof. "To all whom it may concern." On the day set for the hearing of said original petition. shall be filed in the case before the return day. no one appeared to oppose the granting of the prayer which it contained. Section 32 provides. in the first instance" (the original proceeding)." The provisions of section 35 seem to be directly contrary to the contention of the appellants. 496 provides: "If no person appears and answer within the time allowed. notice or citations. The court shall not be bound by the report of the examiner of titles. After the expiration of the period during which notice must be given. The appellants. upon motion of the applicant." all the world are made parties defendant and shall be concluded by the default and order. because they had not been served with personal notice. and shall be conclusive proof of such service. that said "certificate of the clerk that he had served the notice as directed by the court. Neither does the record show any attempt on their part to deny the fact that they received the notices given in the original action. Section 35 of Act No.'" . whether mentioned by name in the application. not that the judgment of the 24th of August. By the description in the notice. 742) was void. is an absolute prerequisite to the validity of said registration. The appellants assert in their argument that "personal notice was absolutely necessary in order to justify the court below in rendering a decree in favor of the plaintiff and appellee. the original cause was set down for hearing. in part. order a general default to be recorded and the application ( petition) be taken for confessed. 496. including the Insular Government.proceedings. but that the original certificate (No. The record also shows that the clerk of the Land Court made a certificate showing that that notice had been issued and published in accordance with the law. was invalid. by publishing or mailing. or included in the general description 'To all whom it may concern. attempt to show. This brings us to the question whether or not personal notice to all of the persons interested in an action for the registration of real property under the Torrens system. subject only to the exceptions stated in the following section.

upon what theory may the applicant be subjected to harassment or delay or additional expense. within a period of one year after the decree of registration and the granting of the certificate. This is not the first time that the question has been presented to this court. Justice Trent. this court. 219 U. (Noble State Bank vs. De la Cruz (17 Phil. simply because personal notice had not been given. The requirements relating to notices has been a fruitful source of litigation." It will be noted also that the petitioner in registration cases is not by law required to give any notice to any person. 49)." by fraud." In the present case five years and a half had transpired and negotiations for the sale of the land to an innocent purchaser had been terminated. and not even then. require proof of actual notice to all the adjoining owners and to all persons who appear to have an interest in or claim to the land included in the application. if an "innocent purchaser for the value has acquired and interest. because some person claims that he did not receive actual personal notice? Section 101 and 102 (Act No. (Sections 31 and 32 of Act No.. but was not . Rep. 104. There is not intimation that the petitioner is guilty of fraud. speaking through Mr. is has been adopted in many States and its provisions have been attacked at almost every point. S.There is a further and very strong intimation in the law that personal notice is not absolutely a prerequisite to the validity of title under the Torrens system. at he has been "deprived of land or any estate or interest therein. In passing upon that question. so far as it deems it possible. The same question was presented to this court in the case of Grey Alba vs. The constitutionality of the law has been attacked many times." Thus it is seen that the applicant is by express provision of law relieved from any obligation whatsoever to give motive to any person of the pendency of his application to have his land registered under the Torrens system..defendant by publication. because of the provision of said law relating to notices.) It is true that "the court may also cause other or further notice of the application to be given in such a manner and to such persons as it may deem proper. The existence of fraud was predicated upon the failure of actual personal notice. Haskell. 496) seem to contain a remedy for persons who have suffered damages for the failure on the part of court officials to comply with the law. 496. the appellee herein was made a party. Section 32 (Act No. in the slightes degree.) His remedy is not to have the registration and certificate annulled. and even then he is without a remedy against the applicant unless he can show. While the Torrens Land Law is a law of modern times. unless he comes within the provisions of section 38. In that case the registered title was attacked upon the ground that fraud existed. 496) provides that: "The court shall. The law requires the clerk of the court to give the notices. said (quoting from the syllabus): In original proceedings for the registration of land under Act No. That being true. 496.

(Tyler vs. It is intended only that the title. It is not intended that lands may be acquired by said system of registration. That the decree of the Court of Land Registration is conclusive against his as well as all the world. are in rem and not in personam. Known claimants can be dealt with.. If there exists known and just claims against the title of the applicant. in her petition. which the petitioner has. and not a system established for the acquisition of land. absolutely. except in the simplicity of subsequent transfer of his title. dealing with a tangible res. The registration either relieves the land of all known as well as unknown claims. personally served with notice: Held. so that thereafter there may be no uncertainly concerning either the character or the extent of such claims. just or unjust. shall be registered and thereby cleared of all liens and burdens of whatsoever character. except those which shall be noted in the order of registration and in the certificate issued. Such a proceeding would be impossible were this not so. The proceedings for the registration of land. Jurisdiction is secured by the power of the court over the res. 496. Judges. 175 Mass. A proceeding in rem. The requirement that personal notice shall be a prerequisite to the validity of registration would absolutely prohibit the foreclosure of unknown claims. he gains nothing in effect by his registration. In discussing the Torrens Land Law we must keep in mind that its primary purpose is the registration of the title which the applicant or petitioner has and to relieve his land of unknown liens or claims. . in fact. for the reason that personal notice could never be given to "unknown claimants. They furnish no valid impediment. against it. 71. may be instituted and carried to judgment without personal service upon the claimants within the state or notice by name to those outside of it. The record shows that she did all the law required her to do. or it compels the claimants to come into court and to make there a record.) In the present case there is not the slightest intimation that the original applicant (Maria del Consuelo Felisa Roxas y Chuidan) was guilty of fraud. The record shows that she named all the persons who might have an interest in the registration of her land. for it would hardly do to make a distinction between the constitutional rights of claimants who were known and those who were not known to the plaintiff." The great difficulty in land titles arises from the existence of possible unknown claimants. The Torrens system of land registration is a system for the registration of title to land only. The applicant is not charged even with negligence. to the transfer of titles. when the proceeding is to bar all. under Act No.

Neff.. (Grey Alba vs. for it hardly would dot to make a distinction between the constitutional rights of claimants who were known and those who were not known to the plaintiff.. and now a member of the Supreme Court of the United State. to satisfy all possible obligations. in the case of Tyler vs. As we have said.. Consequently there came into existence this action in rem. in discussing this question. (Pennoyer vs. and not encounter any provision of either constitution (of the State of Massachusetts or the United States). 71. in like conditions. Its operation necessarily required supplies. American Land Company vs. said: Looked at either from the point of view of history or of the necessary requirements of justice. Rep. To be able to secure all such necessities. when the proceeding is to bar all. Tyler vs. a proceeding in rem. 95 U. 727.. 727.Courts have held that in actions in rem personal notice to owners of a res is not necessary to give the courts jurisdiction to deal with and to dispose of the res. 71). it has been universally considered that the action should be considered as one in rem. Judges. . There exists a multitude of cases in which personal service is not necessary and service by publication is sufficient. (Pennoyer vs. for instance. as well as the rights of claimants against estates of deceased persons. It was established out of the very necessities of the case. perchance. 47. and food. 9 Cranch 126. 144. notice or service upon the defendant may be had by publication. Also unknown claimants or owners may be brought into court without personal notice in an action for the condemnation of private property for public use. The continuance of its voyage depended upon its capacity to make contracts and to get credit. For the purpose of carrying into effect the broader purposes of the Torrens land law.S. Neff. Zeis. in attachment cases. For instance. 219 U. dealing with a tangible res. lived in London. It might also. Justice Holmes. without personal notice of the proceedings in which that may occur.. such as men. 714. 175 Mass.S.. with whom or with which they were dealing. 714. cause damage to other craft. Mr. and not its real owner.) So also in divorce proceedings. such a proceeding would be impossible were this not so. merchants and courts came to regard the "ship" as a person. The Mary. then of the Supreme Court of the State of Massachusetts. The owner of a ship. 95 U. to continue its voyage and its business on the high seas. coal.) This rule was first established in admiralty proceedings. His ship was found in the most distant ports of the earth. personal notice is not a prerequisite. 49.S. De la Cruz. Notice by publication may be had. Judges (175 Mass. 17 Phil. may be instituted and carried to judgment without personal service upon claimants within the State or notice by name to those outside of it. Jurisdiction is secured by the power of the court over the res.) There are many classes of cases where men may be deprived of their property and of their rights. The very nature of its business necessitated the making of contracts.

Moore vs. 47. 580. 21 Am.. 305. 219 U. An.S.) If the state can provide for substituted service for the purpose of quieting title to real estate against an unknown resident. Judges. 47.. Zeiss. 233. Domingues. it may provide a reasonable method for securing substituted services against residents. 76. Taylor. 130 U. 176 Ill.A. 442.. Harvey. 175 Mass. Supp. Zeiss. Arndt vs.S.) The state possesses not only the power to determine how title to real estate may be acquired and proved. 908. 18 Howard (N. Rep. Rep.. Overman. McLaughlin vs.. 481.) The estate. even before the Torrens Law. 381. In order to make such a law valuable and effective to its fullest extent. 219 U. The power of the state to provide methods of quieting title should not be limited to known persons. Wakeman. Company vs. Steinbach.. 134 U. Kerrigan.. Arndt vs.. Wakeham. and the models of establishing title thereto. 56. may provide for the adjudication of title in a proceeding in rem..S. which shall be binding upon all persons known and unknown. St. and for the purpose of determining these question.. 134 U. People vs. The conditions of ownership of real estate in a state.S. whether the owner be a stranger or a citizen. Young vs. 580. 101 U.. American Land Company vs. Perkins vs.S. 124 Mo..t. Simon. Ruppin vs. are subject to its rules. 122 Iowa.. Quarl vs. provided means by which title to land might be quited "by notice by publication to all persons.. 42 La. Wakeham. 343. Co. 86 Cal.. St. Tyler vs. 134 U. vs. Abbett... 564. (State vs. 316. Sandiford vs. transfer. 235. 238. Mitchell vs. 117 Ga. 70. 55 Ark.Y. Arndt vs. 102 Ind. 274. 47. 21 Am. Perkins vs. as sovereign over the lands situated within it.. Huling vs. 316. 165. McGlynn.S. Upshur. 79.. 297..Y.. Rohrer vs. 51 L.. 219 U.A.. Griggs. etc. the states had the power and right to provide a procedure for the adjudication of title to real estate.S. Brown. 208.. 316.S.. liability to obligations. Barker vs.... Cleveland. it (the state) may provide any reasonable rules or procedure. Title. 256. Botiller vs. 20 Cal. 118. 559. it is necessary that it be made to operate on all interest and persons known or unknown. 81 Am. concerning the holding. 90 N. Dec.... Ader. 86 Cal. 52 Am. 24. 571. 662.S.. (American Land Co. Furman. Town of Hempstead. private or public. 67. Rep. 68 Am. 175. 402. 57 L. Document. Perkins vs. 362. 87 Ill. Rep.. 13 Peters. (Clark vs. 233.. Smith. 71. 181 U. Griggs. 180 U. McLaughlin.R.R. etc. 127 U. Parker vs. 86 Cal. or in the nature of a proceeding in rem. American Land Company vs.S. Kaw Valley. 195.) Even before the Torrens Law was adopted.S. Zeiss. 97.S. People's National Bank vs." (Hamilton vs. . Bertrand vs. 580. but it is also within its legislative competency to establish the method of procedure.. Griggs. 130 U.The law. Rep. St. McCrory. The state had control over real property within its limits. 29 Am..) 137. 150 Cal..

Mr. S. in the case of In re Empire City Bank (18 N.. 199. 1906.. 47. In view of the facts and the decisions of the different courts which are cited in that case. and has done none of the acts mentioned in the statutes. alleging in substance that on the 18th and 19th days of April. The criterion is not the possibility of conceivable injury...S. a judicial proceeding to clear titles against all the world hardly is possible. as we must. is the case of the American Land Company vs.. Company vs.S. Title. Document. 150 Cal." Mr. 47) said: "To argue that the provisions of the statute are repugnant to the due process clause (of the Constitution) because a case may be conceived where rights in and to property would be adversely affected without notice being actually conveyed by the proceedings is in effect to deny the power of the state to deal with the subject. that the Constitution does not positively require personal notice in order to constitute a legal proceedings due process of law. but the just and reasonable character of the requirements. in the case of Tyler vs. 289. it is difficult to understand how it is authority in support of the contention of the appellants here. Kerrigan. on the 22d of August. The facts in that case are as follows: Zeiss. that a citizen who owes nothing. If we hold. for the very meaning of such a proceeding is to get rid of unknown as well as known claims — indeed certainly against the unknown may be said to be its chief end — and unknown claims cannot be dealt with by personal service upon the claimant. Chief Justice White of the Supreme Court of the United States. 71) in discussing this question.. Zeiss." The court of appeals of the State of New York. Judges (175 Mass. in the case of the American Land Company vs. 47). commenced an action in the superior court of the country San Francisco.)" The only case cited by the appellants in support of their argument. having reference to the subject with which the statute deals.Y. and what manner of constructive notice shall be sufficient to reasonably apprise the party proceeded against of the Legal steps which are taken against him. Zeiss (219 U. said: "If it (the procedure) does not satisfy the Constitution. notwithstanding all these precautions. may be deprived of his estate without any actual knowledge of the process by which it has been taken from him. in order to sustain this legislation. 215) in speaking of the right of the state to prescribe in suitable cases for substituted service. 1906. a material part of the public records contained in the office of the county recorder of the city and county of San Francisco was destroyed by fire. (American Land Company vs. that on the . etc. Justice Holmes.. Zeiss (219 U. it then belongs to the legislature to determine in the particular instance whether the case calls for this kind of exceptional legislation. said: "Various prudential regulations are made with respect to these remedies by it may possibly happen. 219 U.

adjudging that he was the owner in fee simple. and that said court did not have or obtain jurisdiction to divest the right. liens. present or future. Under these facts the plaintiff. absolute. absolute. 1908) an action was brought in the United States Circuit Court for the Northern District of California. and at the time of the filing of the complaint. as required by the statute. prated that he be adjudged to be the owner of and entitled to the possession of said described parcels of land in fee simple. No one having appeared and opposed the granting of the petition of the complaint. free from all encumbrances. vested or contingent. claims or demands of any kind or nature whatsoever. The complaint alleged that "Zeiss had no right whatever in said parcels of land. and that no one else had any estate. Nothing else seems to have transpired after said decree was issued in favor of Zeiss. interest or estate of plaintiff . present or future. Zeiss. interest. notwithstanding that fact. interest or claim in or to the same. absolute. 1906. and that said superior court. Notice was also posted upon the property. Under these facts the plaintiff. or estate in and to the same. either legal or equitable. 1906. was that of owner in fee simple. absolute. a default was ordered against all persons. was that of owner in fee simple. and on the 19th days of December. prayed that the be adjudged to be the owner of and entitled to the possession of said parcels of land. All . interest in and to said parcels of land. until the 26th day of May. but ready to accept service of summons and easily reached for that purpose. title. no service was made upon them nor did they in any way receive notice of the pendency of the action (Zeiss vs. or one year and five months after the entry of the decree of the superior court. and each of them. claims or demands of any kind or nature whatsoever. free from all encumbrance. as owners in fee simple. and each of them. vested or contingent.18th day of April. title. liens. and entitled to the possession of the land described in the complaint and that no other person had any right title. in said action and proceedings never had any jurisdiction over the persons holding the title during such proceedings. he was the owner and in the actual and peaceable possession of the parcels of land in controversy: that his estate. Upon the presentation of the petition by Zeisss. which had theretofore been decreed to Zeiss. that. either legal or equitable. or any part thereof. other than his rights of possession and occupation. in which the plaintiffs claimed title to the parcels of land. rights. or claimed any interest in or lien upon the property described in the complaint. a summons was issued and notice of the pendency of the action was published in certain newspaper. not seeking to evade. as was required by law. The plaintiff alleged that the decree issued by the superior court of the city and county of San Francisco was void and of no force and effect and was made and maintained without due process of law. Zeiss. On that date (the 26th of May. or any part thereof. title. a decree was entered in favor of Zeiss. in the city and county of San Francisco." The bill further alleged that the plaintiffs had been at all times citizens and residents of California. defect. defects. 1908.

To the complaint the defendant.. Zeiss. and who had by himself or his tenants. containing the names of the court and the country in which the action was brought. to establish his title. may bring and maintain an action in rem. The law further provides that an action shall be commenced by the filing of a verified complaint.persons claiming any interest in or lien upon the real property herein described). against all the world. in a very lengthy and instructive opinion (219 U. the name of the plaintiff. It was intended by said act to provide a method whereby owners in possession of real estate. demurred. in which he shall name the defendants as "all persons claiming any interest in or lien upon the real property herein described. 47). The law provided that upon the filing of the complaint. and to determine all adverse claims thereto. The Supreme Court of the United States. where records had been destroyed to such an extent as to make it impossible to trace a record title." as defendants." Said law is known as the McEnerney Law. The original action by Zeiss was brought to quiet the title to two parcels of land for the purpose of registrating his title to the same under an act of the legislature of the State of California. in whole or in any material part. which notice was directed to "all persons claiming any interest in or lien upon the real property herein described. after a careful analysis of the facts and of the law. fire. S. a summons or notice was required to be issued. in the superior court for the county in which said real property is situate. or any part thereof." He was required to give in his complaint a particular description of the property. Said law provided that whenever the public records in the office of the county recorded had been. . Upon the issue thus presented. or earthquake. the Circuit Court of Appeals for the Ninth District certified the question involved to the Supreme Court of the United States. by flood. entitled "An act to provide for the establishment and quieting of title to real property in case of loss or destruction of public records. any person who claims an estate of inheritance or have title in. or any part thereof. The special occasion for the law was the fact that practically all of the public records of title in several counties in the State of California had recently theretofore been destroyed as the result of an earthquake and fire. decided each of the question submitted by the Circuit Court of Appeals against the contention of the plaintiff and returned the cause to the court below. in actual and peaceable possession any real property in said county. nor did they gain any knowledge of existence of the decree until more than a year after its entry. might secure a degree in the court which would furnish public. authenticated evidence of title. or shall hereafter be lost or destroyed. or other persons holding under him. and a particular description of the property involved.

The law further provided that said summons or notice should be published in a newspaper
of general circulation in the county where the action was brought, at least once a week
for a period of two months.

The law further provided that personal notice should be given to any person claiming an
interest in the property or a lien thereon adverse to the plaintiff.

The said law further provided that upon the publication and posting of the summons and
its service upon and mailing to the person, if any, upon whom it is herein directed to be
specially served, the court shall have full and complete jurisdiction over the plaintiff and
said property and of the person and every one claiming any estate, right, title, or
interest in or to or lien upon said property, or any part thereof, and shall be deemed to
have obtained the possession and control of said property, for the purpose of the action,
and shall have full and complete jurisdiction to render judgment therein, which is
provided for in the law.

In the case of the American Land Company vs. Zeiss, cited and relied upon by the
appellants, the validity of said law was attacked and the legality of the title granted to
Zeiss was impugned for the reason that the law was unconstitutional and void, and
because the plaintiff had not received actual notice of the application to Zeiss to have
his title quieted, under said law. The Supreme Court of the United States (219 U.S., 47)
held, as has been above indicated, that the law was constitutional and that a compliance
with the requirements of the notice provided for in said law was sufficient to give the
court jurisdiction over the res and to enter a valid decree. There seems to be but little
in the decision in the case of the American Land Company vs. Zeiss to support the
contention of the appellants.

Considering that the Legislature of the Philippine Islands had full power to adopt the
procedure provided for in Act No. 496, for the registration of the title of lands; and

Considering that the court in the original action followed strictly the procedure adopted
by said law; and

Considering that there is no claim of fraud, actual or constructive, upon the part of any
of the parties connected with said action, we are forced to the conclusion that the
appellants here are not now entitled to have that judgment or decree of registration and
certificate amended or set aside.

There remains another question, however, which the appellants have not discussed and
which we deem of importance. It is the question of the right of the Land Court
to correct an error of closure in a plan or of a statement contained in a certificate. A

plan is prepared and is presented with the petition for the registration of a parcel of
land. No opponents appear. No opposition is presented to the registration. All the steps
in the procedure required by law have been taken. The land is registered. It is then
discovered for the first time that by reason of a wrong direction given to one of the
lines in the plan, said plan will not close — that if a wall were built upon the lines of the
plan, one of the four corners of the wall would not meter. We believe that an error of
the character may be corrected by the court, provided that such correction does not
include land not included in the original petition. Upon the question whether the amended
plan (p.252, record) included more or different lands than were included in the original
petition, we find the following statements made by one of the judges who ordered said
plan amended. The statements is:

At this stage of the proceedings and on his particular point nothing further is
incumbent upon the court than to determine the property as it was adjudicated
in this case.

Therein no new portion was either added or subtracted, and this court finds
that such should be the holding on this particular point.

We have a further statement made by one of the judges, the Honorable Charles H.
Smith, relating to the same question, in an answer presented by him to a petition for a
writ of prohibition, presented by some the appellants herein, to the Supreme Court. That
petition for a writ of prohibition involved practically the same question presented by the
appellants here now. Upon the question whether or not additional lands had been included
in the new plan (p.252, record), Judge Smith, in answering for himself and his associates
(Ostrand and Romualdez) said:

Respondents deny that a new dividing line between the premises in question
(premises of the plaintiff and appellant) was determined and established by an
order of the court issued at the conclusion of said proceedings, but, on the
contrary, respondents charge the truth to be that the dividing line between said
properties was not changed but simply approved and so indicated upon the
record title. For instance, the line between said properties beginning on the
south side of the Escolta is exactly at the same point indicated in the original
description and approved by the court; in other words, the premises in question
of the said Maria del Consuelo Felisa Roxas y Chuidian have not been enlarged;
the boundary lines thereof have not been changed; the real descriptions of the
properties have been left undisturbed; the adjoining land owned by the
petitioners is undiminished, except possibly as to alleged easements claimed to
have been created by the projection of some of the roots of the petitioners'
building over the aforesaid registered property of the said Roxas. That matter

is settled clearly by the provisions of the last paragraph of section 39 of Act
No. 496."

We called attention above to the fact that the petitioner alleged that the line A-B of
her property ran S., 44º 30' W., a distance of 31.08 meters, while the plan accompanying
said petition (see Exhibit A, page 35, ante) made said line to run S., 46º 30' W., a
distance of 31.08 meters An examination of the certificate issued to the petitioner (see
page 39, ante) also states that the line A-B runs S., 46 30' W., for a distance of 31.08
meters. The record contains no application why the original plan (see Exhibit A, page 35,
ante) did not conform to the description of the land given in the petition. That error, in
our judgment, seems to have constituted the real difficulty with the closure of the plan.
Under said conditions we are of the opinion that the Land Court is entirely justified in
ordering the plan corrected for the purposes above indicated.

There is still another question involved in the case, which the appellants have not
discussed, and that is the right of Maria del Consuelo Felisa Roxas y Chuidian to have her
original certificate of registration corrected, for the purpose of showing that she was
the owner of the buildings located upon the parcel of land in question. It will be
remembered that in her petition presented January 12, 1906, she alleged that she was
the owner of the parcel of land in question, together with the buildings thereon. No
opposition was presented. No objection was made to the registration of the land as
described in her petition. The record shows no reason why the buildings should have
been omitted in the certificate of registration. The omission must have been an errors.
on the part of the clerk. We find that Act No. 496 contains an express provision for the
correction of such errors. Section 112 provides that the registered owner may, at any
time, apply by petition to have corrected any "error, omission, or mistake made in
entering a certificate, or any memorandum thereon, or on any duplicate certificate." We
think the petition presented by Miss Roxas for the correction of such original
certificate was entirely within her right under the law. It might be claimed, and we
believe that the proposition is sustained by law, that the registration of a parcel of land,
unless the record contains something to the contrary, necessarily includes the buildings
and edifices located thereon, even though they are not mentioned. Without relying upon
that proposition of law, however, and in view of the petition of the plaintiff, it is hereby
ordered that the original certificate be amended so as to include not only the land
described in the original petition, but the buildings located thereon as well.

With reference to the petition of the Masonic Temple Association of Manila, the record
contains no sufficient reasons for not granting the same.

Therefore, and in view of all of the foregoing, we are of the opinion that the judgment
of the court below should be and it is hereby affirmed, with costs.

G.R. No. L-8936 October 2, 1915

CONSUELO LEGARDA, with her husband MAURO PRIETO, plaintiffs-appellants,
vs.
N.M. SALEEBY, defendant-appellee.

Singson, Ledesma and Lim for appellants.
D.R. Williams for appellee.

JOHNSON, J.:

From the record the following facts appear:

First. That the plaintiffs and the defendant occupy, as owners, adjoining lots in the
district of Ermita in the city of Manila.

Second. That there exists and has existed a number of years a stone wall between the
said lots. Said wall is located on the lot of the plaintiffs.

Third. That the plaintiffs, on the 2d day of March, 1906, presented a petition in the
Court of Land Registration for the registration of their lot. After a consideration of
said petition the court, on the 25th day of October, 1906, decreed that the title of the
plaintiffs should be registered and issued to them the original certificate provided for
under the torrens system. Said registration and certificate included the wall.

Fourth. Later the predecessor of the defendant presented a petition in the Court of
Land Registration for the registration of the lot now occupied by him. On the 25th day
of March, 1912, the court decreed the registration of said title and issued the original
certificate provided for under the torrens system. The description of the lot given in
the petition of the defendant also included said wall.

Fifth. Several months later (the 13th day of December, 1912) the plaintiffs discovered
that the wall which had been included in the certificate granted to them had also been
included in the certificate granted to the defendant .They immediately presented a
petition in the Court of Land Registration for an adjustment and correction of the error
committed by including said wall in the registered title of each of said parties. The lower
court however, without notice to the defendant, denied said petition upon the theory
that, during the pendency of the petition for the registration of the defendant's land,

S. In other words. The wall is not a joint wall.. more than six years before. it can not be denied that the proceeding for the registration of land under the torrens system is judicial (Escueta vs. 31. 175 Mass. 47. it would seem that once a title is registered the owner may rest secure.. (Escueta vs.they failed to make any objection to the registration of said lot. without the necessity of waiting in the portals of the court. except claims which were noted at the time of registration. including the wall. 16 Phil. Sixth.. All the world are parties. 29 Phil. De la Cruz. rep. It is clothed with all the forms of an action and the result is final and binding upon all the world. Under these facts. in the name of the defendant. The real purpose of that system is to quiet title to land. Director of Lands (supra). by permitting the plaintiffs to have the same registered in their name. there are no innocent third parties who may claim an interest. who is the owner of the wall and the land occupied by it? The decision of the lower court is based upon the theory that the action for the registration of the lot of the defendant was a judicial proceeding and that the judgment or decree was binding upon all parties who did not appear and oppose it. Grey Alba vs. vs. 482). 51 American Land Co. That the land occupied by t he wall is registered in the name of each of the owners of the adjoining lots. by reason of the fact that the plaintiffs had not opposed the registration of that part of the lot on which the wall was situate they had lost it. even though it had been theretofore registered in their name. Of course. including the government. and granting even that the wall and the land occupied by it.) While the proceeding is judicial. then the same theory should be applied to the defendant himself.. he had already lost whatever right he had therein. in the certificate. Granting that theory to be correct one. It is an action in rem. Zeiss.Director of Lands. registered? If that question is to be answered in the affirmative. .. including the wall. or sitting in the "mirador de su casa. Tyler vs. were they obliged to constantly be on the alert and to watch all the proceedings in the land court to see that some one else was not having all. or a portion of the same. Having thus lost hid right. it involves more in its consequences than does an ordinary action. in fact. Judges. Rep. or which may arise subsequent thereto. Rep. may he be permitted to regain it by simply including it in a petition for registration? The plaintiffs having secured the registration of their lot. then the whole scheme and purpose of the torrens system of land registration must fail. After the registration is complete and final and there exists no fraud. 17 Phil. Applying that theory to him. belonged to the defendant and his predecessors. to put a stop forever to any question of the legality of the title. 49 Roxas vs. Enriquez. The rights of all the world are foreclosed by the ." to avoid the possibility of losing his land. 219 U. That being the purpose of the law.

the difficulty has been settled by express statutory provision. and notorious possession. or diminished. is notice to the world. A title once registered can not be defeated. modified. Hogg. it must follow that future litigation over the title is forever barred. except as to rights which are noted in the certificate or which arise subsequently. and with certain other exceptions which need not be dismissed at present. The registration. All persons must take notice. does not give the owner any better title than he had. is well settled that the decree ordering the registration of a particular parcel of land is a bar to future litigation over the same between the same parties . would destroy the very purpose and intent of the law. in his excellent discussion of the "Australian Torrens System. In some jurisdictions. enlarged. changed. has been presented to the courts in other jurisdictions. The rule. modified. after the lapse of the period prescribed by law. except in some direct proceeding permitted by law. In others it has been settled by the courts. is the rule. 496) providing for the registration of titles under the torrens system affords us no remedy.decree of registration. If he does not already have a perfect title. in the absence of fraud. The certificate. A registered title can not be altered. or only in part. is the evidence of title and shows exactly the real interest of its owner. or diminished in a collateral proceeding and not even by a direct proceeding. altered. Act No. Otherwise all security in registered titles would be lost.In view of the fact that all the world are parties. . purporting to include the same land. even by an adverse. open. under the torrens system. The title once registered. The question. he can not have it registered. the earlier in date prevails." at page 823. There is no provision in said Act giving the parties relief under conditions like the present. who is the owner of land registered in the name of two different persons. To permit persons who are parties in the registration proceeding (and they are all the world) to again litigate the same questions. The title. we think. says: "The general rule is that in the case of two certificates of title. enlarged. 496). whether the land comprised in the latter certificate be wholly. No one can plead ignorance of the registration. where the "torrens" system has been adopted. This. Registered title under the torrens system can not be defeated by prescription (section 46. should not thereafter be impugned. There is nothing in the Act which indicates who should be the owner of land which has been registered in the name of two different persons. once registered. The certificate of registration accumulates in open document a precise and correct statement of the exact status of the fee held by its owner. there can be no persons who are not parties to the action. The government itself assumes the burden of giving notice to all parties. For the difficulty involved in the present case the Act (No. and to again cast doubt upon the validity of the registered title. Fee simple titles only may be registered. we think. with very few exceptions.

Z. and not even for fraud. Merry.) 48..comprised in the earlier certificate. including the Insular Government and all the branches thereof. Esperance Land Co. vs. for any reason. Williams. the person claiming under the prior certificates is entitled to the estate or interest. Register of Titles.R.L. and the effect of this undoubtedly is that where two certificates purport to include the same registered land.R. subject.T. (V. 7 N. whether mentioned by name in the application. notice." supra. While the acts in this country do not expressly cover the case of the issue of two certificates for the same land. R. however. Myfield.C. where more than one certificate is issued in respect of a particular estate or interest in land. that the "decree of registration" shall not be opened. 2 Q. in any court.. except for fraud. Stevens vs.. except for fraud. 193.. may such decree be opened or set aside in a collateral proceeding by including a portion of the land in a subsequent certificate or decree of registration? We do not believe the law contemplated that a person could be deprived of his registered title in that way. In successive registrations. 152.)" Hogg adds however that. the mistake may be rectified by holding the latter of the two certificates of title to be conclusive. If then the decree of registration can not be opened for any reason. Davy." (See Hogg on the "Australian torrens System. We have in this jurisdiction a general statutory provision which governs the right of the ownership of land when the same is registered in the ordinary registry in the name of . (Oelkers vs. Lloyd vs. the holder of the earlier one continues to hold the title" (p. after the lapse of one year. from said section. provided no innocent purchaser for value has acquired an interest. nor by any proceeding in any court for reversing judgments or decrees. they provide that a registered owner shall hold the title. said: "Where two certificates purport to include the same land the earlier in date prevails. 155. that the inclusion of the land in the certificate of title of prior date is a mistake. 12 V.. or other disability of any person affected thereby. or whose claim is derived directly or indirectly from the person who was the holder of the earliest certificate issued in respect thereof.. 237). "It (the decree of registration) shall be conclusive upon and against all persons. 7 A.) Niblack. 118. Section 38 of Act No. or citation. and that person is deemed to hold under the prior certificate who is the holder of.. It will be noted. in discussing the general question. . infancy. See also the excellent work of Niblack in his "Analysis of the Torrens System. provides that. Miller vs.A. "if it can be very clearly ascertained by the ordinary rules of construction relating to written documents.S. and cases cited. 496. to the right of any person deprived of land or of any estate or interest therein by decree of registration obtained by fraud to file in the Court of Land Registration a petition for review within one year after entry of the decree (of registration).L. 1 W." page 99.R." Such decree shall not be opened by reason of the absence. in a direct proceeding for that purpose. or included in the general description "To all whom it may concern.

that when one piece of real property had been sold to two different persons it shall belong to the person acquiring it. we are of the opinion and so decree that in case land has been registered under the Land Registration Act in the name of two different persons. even though we see no objection thereto. in the absence of other express provisions. then nothing has been gained by the registration and the expense incurred thereby has been in vain. Article 1473 of the Civil Code provides. and if he was not the real owner he can not complain) in not opposing the registration in the name of the appellants. taking into consideration al of the conditions and the diligence of the respective parties to avoid them. among other things. yet we think. The real ownership in such a case depends upon priority of registration. the appellee was the first negligent (granting that he was the real owner. they should have a persuasive influence in adopting a rule for governing the effect of a double registration under said Act. In reaching the above conclusion. Teus. If the holder may lose a strip of his registered land by the method adopted in the present case. He says. They had their day in court and can not set up their own omission as ground for impugning the validity of a judgment duly entered by a court of competent jurisdiction. and sometimes the damage done thereby is irreparable. and that of orders. As was said above. It is the duty of the courts to adjust the rights of the parties under such circumstances so as to minimize such damages. Adopting the rule which we believe to be more in consonance with the purposes and the real intent of the torrens system. was seeking to foreclose their right. To decide otherwise would be to hold that lands with torrens titles are above the law and beyond the jurisdiction of the courts". Suppose within the six years which elapsed after the plaintiff had secured their title. he may lose it all. "When Prieto et al.two persons. He was a party-defendant in an action for the registration of the lot in . we have not overlooked the forceful argument of the appellee. of course. they had mortgaged or sold their right. Through their failure to appear and contest his right thereto. and the subsequent entry of a default judgment against them. If those dealing with registered land cannot rely upon the certificate. In the present case. the earlier in date shall prevail. presupposes that each of the vendees or purchasers has acquired title to the land. the primary and fundamental purpose of the torrens system is to quiet title. While we do not now decide that the general provisions of the Civil Code are applicable to the Land Registration Act. If the holder of a certificate cannot rest secure in this registered title then the purpose of the law is defeated. they became irrevocably bound by the decree adjudicating such land to Teus. This rule. were served with notice of the application of Teus (the predecessor of the defendant) they became defendants in a proceeding wherein he. what would be the position or right of the mortgagee or vendee? That mistakes are bound to occur cannot be denied. who first inscribes it in the registry. among other things. to the parcel of land described in his application.

question. in the absence of fraud. forever closes his mouth against impugning the validity of that judgment. in the name of the appellants. in 1906. That is the rule between original parties. persons who had had a right or interest in land wrongfully included in an original certificate would be unable to enforce such rights against an "innocent purchaser. that the owner of the earliest certificate is the owner of the land. by virtue of the sale by him to the appellee? Suppose the appellants had sold their lot.Which of the two innocent purchasers. including the wall. if they are both to be regarded as innocent purchasers. He had his day in court and should not be permitted to set up his own omissions as the ground for impugning the validity of a judgment duly entered by a court of competent jurisdiction. Sections 38." The general rule is that the vendee of land has no greater right. and the subsequent entry of a default judgment against him. 55. before the error is discovered." in said sections. He subsequently sold the same to the appellee. and 112 of Act No. should be protected under the provisions of said sections? These questions indicate the difficulty with which we are met in giving meaning and effect to the phrase "innocent purchaser." would such purchaser be included in the phrase "innocent purchaser. in case of double registration under the Land Registration Act." Granting that he was the owner of the land upon which the wall is located. transfers his original certificate to an "innocent purchaser." by virtue of the provisions of said sections. seem to cast some doubt upon the rule that the vendee acquires the interest of the vendor only. 496 indicate that the vendee may acquire rights and be protected against defenses which the vendor would not. Under that rule the vendee of the earlier certificate would be the owner as against the vendee of the owner of the later certificate." That is to say. "Through his failure to appear and to oppose such registration. upon first reading. There is no more reason why the doctrine invoked by the appellee should be applied to the appellants than to him. to an "innocent purchaser. We find statutory provisions which. or interest than his vendor. In the present case Teus had his land. We have decided. his failure to oppose the registration of the same in the name of the appellants. May this rule be applied to successive vendees of the owners of such certificates? Suppose that one or the other of the parties. title." as that phrase is used in said sections? May those who have been deprived of their land by reason of a mistake in the original certificate in favor of Teus be deprived of their right to the same. . registered in his name." as the same is used in said sections? Under these examples there would be two innocent purchasers of the same land. is said sections are to be applied . Is the appellee an "innocent purchaser. he became irrevocably bound by the decree adjudicating such land to the appellants. only. Said sections speak of available rights in favor of third parties which are cut off by virtue of the sale of the land to an "innocent purchaser. including the wall. that he acquires the right which his vendor had.

Freeman. 78 Ill.Y. It is never issued until it is recorded. 500. sections 710. 1875 and 606 of the Civil Code. Buchanan vs. 15 Ohio State.S. assigns. When a conveyance has been properly recorded such record is constructive notice of its contents and all interests. Otherwise the very purpose and object of the law requiring a record would be destroyed. 341. legal and equitable. bona fide in the sense that he had no knowledge of the existence of the mortgage? We believe the rule that all persons must take notice of what the public record contains in just as obligatory . The record notice to all the world. Youngs vs. included therein. All persons dealing with the land so recorded. 97. Orvis vs. While there is no statutory provision in force here requiring that original deeds of conveyance of real property be recorded. The rule that all persons must take notice of the facts which the public record contains is a rule of law. when third parties were interested? May a purchaser of land. 509. Montefiore vs. Anderson. subsequent to the recorded mortgage.. be relieved from the mortgage lien by the plea that he was a bona fide purchaser? May there be a bona fide purchaser of said land. Such presumption is irrebutable.. 20 Cal. (Grandin vs.) The record of a mortgage is indispensable to its validity.. McCabe vs. All persons are charged with the knowledge of what it contains.May the purchaser of land which has been included in a "second original certificate" ever be regarded as an "innocent purchaser.) In the face of that statute would the courts allow a mortgage to be valid which had not been recorded.) Under the rule of notice. his heirs. it is presumed that the purchaser has examined every instrument of record affecting the title. The rule must be absolute. Delvin on Real Estate. 710 [a]). 27 N. 286. Intentional Bank. must be charged with notice of whatever it contains. 629. plead ignorance of its existence. Any variation would lead to endless confusion and useless litigation. Browne. and by reason of such ignorance have the land released from such lien? Could a purchaser of land. 171 U. or any portion of it. 17 Conn. Wilson. He is charged with notice of every fact shown by the record and is presumed to know every fact which an examination of the record would have disclosed. (Art . Newell.1875.. The purchaser is charged with notice of every fact shown by the record and is presumed to know every fact which the record discloses . Grey. Such presumption cannot be defeated by proof of want of knowledge of what the record contains any more than one may be permitted to show that he was ignorant of the provisions of the law.This rule is so well established that it is scarcely necessary to cite authorities in its support (Northwestern National Bank vs." as against the rights or interest of the owner of the first original certificate. after the recorded mortgage. 620. yet there is a rule requiring mortgages to be recorded. or vendee? The first original certificate is recorded in the public registry. upon the plea of ignorance of the statutory provision.. 7 House of Lords Cases. 351. 289. (Arts. This presumption cannot be overcome by proof of innocence or good faith.

The holder of the first original certificate and his successors should be permitted to rest secure in their title. He cannot be regarded as an "innocent purchaser" because of the facts contained in the record of the first original certificate. The rule of notice of what the record contains precludes the idea of innocence. is mandatory and obligatory. can be an "innocent purchaser" of the portion of the land included in another earlier original certificate. that no one can plead ignorance of the law. By reason of the prior registry there cannot be an innocent purchaser of land included in a prior original certificate and in a name other than that of the vendor." used in said sections. The conduct of men. Could his vendee be regarded as an "innocent purchaser" of said strip? Would his vendee be an "innocent purchaser" of said strip? Certainly not. may the purchaser of land from the owner of the second original certificate be an "innocent purchaser. We do not believe that the phrase "innocent purchaser should be applied to such a purchaser. The fact that all men know the law is contrary to the presumption. Suppose he had sold his lot to the appellee and had included in his deed of transfer the very strip of land now in question. notwithstanding. or his successors. The rule." when a part or all of such land had theretofore been registered in the name of another. That being the rule. He. the question must be answered in the negative. The . It would be just as logical to allow the defense of ignorance of the existence and contents of a public record. in case of a mistake like the present. however. against one who had acquired rights in conflict therewith and who had full and complete knowledge of their rights. or his successors. When land is once brought under the torrens system. should be required to resort to his vendor for damages. The rule should not be applied to the purchaser of a parcel of land the vendor of which is not the owner of the original certificate. rather than to molest the holder of the first certificate who has been guilty of no negligence. and his successors. In order to minimize the difficulties we think this is the safe rule to establish.upon all persons as the rule that all men must know the law. therefore. in nonsense. at times. Has the appellee gained any right by reason of the registration of the strip of land in the name of his vendor? Applying the rule of notice resulting from the record of the title of the appellants. not the vendor? We are of the opinion that said sections 38. that Teus had never had his lot registered under the torrens system. should be limited only to cases where unregistered land has been wrongfully included in a certificate under the torrens system. of the foregoing rules of law. We are of the opinion that these rules are more in harmony with the purpose of Act No. In view. We believe that the purchaser from the owner of the later certificate. the record of the original certificate and all subsequent transfers thereof is notice to all the world. and 112 should not be applied to such purchasers. Suppose. 496 than the rule contended for by the appellee. could Teus even regarded as the holder in good fifth of that part of the land included in his certificate of the appellants? We think not. for example. The record of the original certificate of the appellants precludes the possibility. We believe the phrase "innocent purchaser. 55. shows clearly that they do not know the law.

that the record under the torrens system. without deciding it. in dealing with land registered and recorded alone. Once land is registered and recorded under the torrens system. The record is hereby returned to the court now having and exercising the jurisdiction heretofore exercised by the land court. If that view is correct then it will be sufficient.purchaser of land included in the second original certificate. to hold that the one who acquired it first and who has complied with all the requirements of the law should be protected. J. Without any findings as to costs. defendants-appellees. ET AL.. Office of the Solicitor General Edilberto Barot and Solicitor Camilo D. it is so ordered. Neither do we now attempt to decide the effect of the former registration in the ordinary registry upon the registration under the torrens system. the judgment of the lower court should be and is hereby revoked. Quiason for appellee UP. above stated. as well as in all other duplicate certificates issued.R. supersede all other registries. It would be seen to a just and equitable rule. when two persons have acquired equal rights in the same thing. PEOPLE'S HOMESITE & HOUSING CORPORATION. resulting from such purchase. all the difficulties resulting from double registration under the torrens system and the subsequent transfer of the land. vs. We are inclined to the view. by reason of the facts contained in the public record and the knowledge with which he is charged and by reason of his negligence. No. ET AL. nor pretend to solve. rather than he who has obtained the first certificate and who was innocent of any act of negligence. should suffer the loss.: . with direction to make such orders and decrees in the premises as may correct the error heretofore made in including the land in the second original certificate issued in favor of the predecessor of the appellee. if any. 1959 MARCELINO TIBURCIO. that record alone can be examined for the purpose of ascertaining the real status of the title to the land. G. BAUTISTA ANGELO. The foregoing decision does not solve. L-13479 October 31. plaintiffs-appellants. In view of our conclusions.

that said plaintiffs have always been actual. exclusive and continuous possession as owners of the land in litigation.This is an action for reconveyance of a parcel of land located in Quezon City containing an area of about 430 hectares. while the other defendant University of the Philippines began also asserting title thereto claiming that its Transfer of Certificate of Title No. it is claimed that the complaint alleges the following facts: that plaintiffs are the sole heirs of Eladio Tiburcio who died intestate in 1910. adverse. Leonila G. defendant is separated from the case and be impleaded in a separate action. 1877 and up to the present they and their ancestors have been in actual. having had full notice of plaintiff's actual possession and claim for ownership thereof. open. open. notorious and exclusive possession of the land as owners pro indiviso. filed a motion for bill of particulars to which plaintiffs filed also a reply. and that the inclusion of plaintiff's property within the technical boundaries set out in defendants' titles was a clear mistake and that at no time had defendants' predecessors in-interest exercised dominical rights over plaintiff's property. Thus. on the other hand. they have been paying the land taxes thereon. On December 11. 1957. that they have been cultivating the land and enjoying its fruits exclusively. 1356 embraces practically all of plaintiff's property. To this motion plaintiffs filed a reply alleging that the complaint on its faces alleges a valid and sufficient cause of action upon which the court could render a valid judgment. public. From this order plaintiffs took the present appeal. that defendants are not innocent purchasers for value. the trial court issued an order dismissing the complaint on the ground of lack of cause of action and that it is already barred by the statute of limitations. that from time immemorial up to the year 1955. that it is barred by the statute of limitations. On November 20. 9462 covers the remaining portion. de Perucho and Jose Peñaranda filed a motion for intervention which was likewise opposed by plaintiffs. On October 31. and that in the event the motion is not granted. that in 1955 defendant People's Homesite & Housing Corporation began asserting title thereto claiming that its Transfer Certificate of Title No. plaintiffs filed an action before the Court of First Instance of Quezon City alleging that for many years prior to March 25. that upon his death Eladio Tiburcio left to plaintiffs as his sole heirs a tract of land located in Quezon City. that sometime in 1955 defendants began asserting title to . On October 11. 1957. defendant University of the Philippines filed a motion to dismiss alleging that the complaint states no cause of action. Appellants contend that the lower court erred in dismissing the complaint on the ground of lack of sufficient cause of action for the reason that on its face said complaint alleges sufficient facts on which a valid judgment could be rendered against defendants. that the court has no jurisdiction over the case. 1957. Defendant People's Homesite & Housing Corporation. leaving unresolved the other points raised in the pleadings for being unnecessary. 1957.

48 Phil. 581. Apurado. . 836). and as such they cannot be considered innocent purchasers for value. Bacando. Register of Deeds. The purpose of the law in limiting to one year the period within which the decree may be reviewed is to put a limit to the time within which a claimant may ask for its revocation.. they allowed a period of 43 years before they woke up to invoke what they now claim to be erroneous when the court decreed in 1914 the registration of the land in the name of defendant's predecessor-in-interest. 1607. It appears. Moran. 520). however. Evidently. 13th Supp. 496. 40 Off. 1356 was issued in its favor. they have never taken any step to nullify said title until 1957 when they instituted the present action. It is therefore. 9462 was issued in its favor. our law is clear that upon the expiration of the one-year period within to review the decree of registration. this cannot be done for under our law and jurisprudence. Act No.. It further appears that sometime in 1955 defendant People's Homesite & Housing Corporation acquired from the original owner a parcel of land embracing practically all of plaintiff's property for which Transfer Certificate of Title No. Rivera vs. the object of the Torrens system which is to guarantee the indefeasibility of the Title would be defeated (Cabanos vs. clear that the land in question has been registers in the name of defendant's predecessor-in-inters since 1914 under the Torren's system and that notwithstanding what they now claim that the original title lacked the essential requirements prescribed by law for their validity. a decree of registration can only be set aside within one year after entry on the ground of fraud provided no innocent purchaser for value has acquired the property (Section 38.the land claiming that the same is embraced and covered by their respective certificates of title. Thus. 26 Phil. that the land in question has been placed under the operation of the Torrens system since 1914 when it has been originally registered in the name of defendant's predecessor-in-interest. Gaz. If after title to property is decreed an action may be instituted beyond the one-year period to set aside the decree. This contention overlooks the fact that the land in question is covered by Torrens title. 496). Plaintiffs likewise contend that since the complaint alleges that defendants acquired their respective titles with full notice of the actual possession and claim of ownership of plaintiffs with respect to the land in question. 40 Phil.. On the other hand. In other words. Apurado vs.. while defendant University of the Philippines likewise acquired from the same owner another portion of the land which embraces the remainder of the property for which Transfer Certificate of Title No. Salmon vs. that defendants acquired their respective titles with full notice of the actual possession and claim of ownership of plaintiffs. it is error to dismiss the complaint for such averment is sufficient to establish a cause of action against defendants. the decree as well as the title issued in pursuance thereof becomes incontrovertible (Section 38 Act No.

4954)." Appellants finally claim that the lower court erred in dismissing the complaint on the ground of res judicata by taking judicial notice of its own records in Land Registration Case No. Said defendants are therefore. 306. There is nothing in the complaint to show that when it acquired the property said defendant knew of any defect in the title appearing on its face in the form of any lien or encumbrance. 1957 this Court said: "Like Ciriaco Allingag in the previous case. Sian. The same thing is true with regard to defendant University of the Philippines. In the recent case of Domingo vs. Gaz. The foregoing finds support in the following well-settled principle: "A person dealing with registered land is not required to go behind the register to determine the condition of the property. 1356 was issued in its favor. and their action (if any) now should be held by their own laches and negligence. To require him to do more is to defeat one of the primary objects of the Torrens System. their right however to bring the instant action may be considered barred by laches for not having taken the action seasonably after title to the property had been issued under the Torrens system. It appears that the property in question was originally registered on May 3. Paraiso vs. 32. L-3 invoking in support of their contention the principle that a court cannot take judicial notice of the contents of the records of other case even when such case had been tried by the same court and notwithstanding the facts that both cases may have been tried before the same judge. 102 Phil. 187. It likewise acquired the portion of the property on question sometime in 1955 from its predecessor-in-interest for which Transfer Certificate of Title No. 105 Phil. Mayon Realty Corporation. 1957 that appellants asserted their claim thereto when they brought the present action. 64 Phil. Camon. 1959). Assuming arguendo that plaintiffs' action for reconveyance had not yet prescribed as contended.. 54 Off. They failed to do so until 18 years afterwards. There is also nothing in the complaint to show that when it acquired the property it knew of any defect in the title appealing on its face in the form of any lien or incumbrace.. Castillo vs. While the principle invoked is considered to be . presumed to be purchasers for value and in good faith and as such are entitled to protection under the law.. 9462 was issued in its favor." (William H. when the foreclosure sale in her favor was confirmed. appellants herein could have raised the issue of the validity of the certificate of title issued to Valle Cruz since 1928. 1914 and it was only on October 11. supra. Garcia. Anderson vs. 622..it appears that defendant People's Homesite & Housing Corporation bought the portion of the property in question from its predecessor-in-interest sometime in 1955 for which Transfer Certificate of Title No. September 30. p. He is only charged with notice of the burdens on the property which are noted on the face of the register or the certificate of title.

in effect it was represented by its predecessor-in-interest. to determine whether or not the appeal was taken on time. Indeed. J. and the Bureau of Lands.R. 2011 BETTY B. Petitioner. as noted by former Chief Justice Moran: In some instance. CV No. the order appealed from is affirmed.. 67596. Thus. vs. It appears that in the registration case the oppositors were the People's Homesite & Housing Corporation. assailing the September 14.. Courts have also taken judicial notice of previous cases to determine whether or not the case pending is a moot one or whether or not a previous ruling is applicable in the case under consideration. Wherefore. G. JR. with costs against appellants. Although the University of the Philippines was not an oppositor in that case. Moreover.: This settles the petition for review on certiorari filed by petitioner Betty B. The CA had affirmed the February 10. 165427 March 21. JR. There are exceptions to this rule. Samoy. LACBAYAN.the general rule. Lacbayan against respondent Bayani S.R. who instituted the present case. the same is not absolute. from which it acquired the property. Jr.. courts have taken judicial notice of proceedings in other causes. because of their close connection with the matter in the controversy. Tuason and Co. the trial court did not err in dismissing the complaint on the ground of res judicata. Respondent. It may therefore be said that in the two case there is not only identity of subject matter but identity of parties and causes of action. DECISION VILLARAMA. 2000 Decision2 of the Regional Trial Court (RTC). 2004 Decision 1 of the Court of Appeals (CA) in CA-G. BAYANI S. SAMOY. of Quezon City . is the same person who filed the application in Land Registration Case No. Branch 224. Tuason and Co. in a separate civil action against the administrator of an estate arising from an appeal against the report of the committee on claims appointed in the administration proceedings of the said estate. the court took judicial notice of the record of the administration proceedings. No. L-3 for the registration of the same parcel of land which application was denied by the court. appellants' objection to the action of the trial court on this matter is merely technical because they do not dispute the fact that appellant Marcelino Tiburcio. Thus.

V. Despite respondent being already married."8 5. 1979. Samoy."6 3. Samoy. petitioner and respondent. 4 Five parcels of land were also acquired during the said period and were registered in petitioner and respondent’s names.000. A 400-square meter real estate property located at Don Enrique Heights. "married to Betty Lacbayan. "married to Betty L.20-square meter real estate property located at Zobel St. A 255-square meter real estate property located at Malvar St.. Petitioner and respondent met each other through a common friend sometime in 1978.. Samoy. Quezon City covered by TCT No.00 as attorney’s fees. 23301 and registered in the name of "Spouses Bayani S. Samoy and Betty Lacbayan. also in Project 4. 335193 and registered in the name of Bayani S. The lands are briefly described as follows: 1. A 296-square meter real estate property located at Main Ave. A 183. Quezon City covered by TCT No. ostensibly as husband and wife.10 . in Project 4. This suit stemmed from the following facts.. Quezon City covered by TCT No. Quezon City.. were able to establish a manpower services company. Jr."5 2. Jr. Later. she and their son transferred to Zobel St. RT-38264 and registered in the name of Bayani S. Quezon City covered by TCT No." 9 Initially. Samoy. Quezon City covered by TCT No. Samoy.3 During their illicit relationship. 303224 and registered in the name of Bayani S. Jr.. their relationship developed until petitioner gave birth to respondent’s son on October 12. A 300-square meter real estate property located at Matatag St. Luna. Samoy. In 1983. Quezon City.. together with three more incorporators. petitioner lived with her parents in Mapagbigay St.declaring respondent as the sole owner of the properties involved in this suit and awarding to him P100. Jr. and finally to the 400-square meter property in Don Enrique Heights. 90232 and registered in the name of Bayani S."7 4. "married to Betty L. petitioner left her parents and decided to reside in the property located in Malvar St. "married to Betty Lacbayan Samoy.

13 Feeling aggrieved. In 1998.000. however. respondent refused. with the intention to sell them later on for the purchase or construction of a new building. and to prevent the possible dissipation of the said properties since his legal wife was then a heavy gambler. 20 He countered that the said properties were registered in his name together with petitioner to exclude the same from the property regime of respondent and his legal wife.15 Respondent.33% share. salaries. dividends. both parties agreed to divide the said properties and terminate their business partnership by executing a Partition Agreement. denied petitioner’s claim of cohabitation and said that the properties were acquired out of his own personal funds without any contribution from petitioner. 11 Initially. 1999.24 Aggrieved. testified that the properties were purchased from his personal funds.12 However. when petitioner wanted additional demands to be included in the partition agreement. meanwhile.500.16 however. and Don Enrique Heights be assigned to the latter.00. Petitioner argued that the trial court’s decision subjected the certificates of title over the said properties to collateral .22 On February 10.17 During the trial. 2000. while the ownership over the three other properties will go to respondent.18 Petitioner likewise claimed that they acquired the said real estate properties from the income of the company which she and respondent established.Eventually. the trial court rendered a decision dismissing the complaint for lack of merit.21 Respondent added that he also purchased the said properties as investment.19 Respondent. petitioner admitted that although they were together for almost 24 hours a day in 1983 until 1991. the RTC decided to give considerable weight to petitioner’s own admission that the properties were acquired not from her own personal funds but from the income of the manpower services company over which she owns a measly 3. in his Answer. their relationship turned sour and they decided to part ways sometime in 1991. acquiring real properties amounting to P15. respondent agreed to petitioner’s proposal that the properties in Malvar St.23 In resolving the issue on ownership. In her complaint. petitioner filed a complaint for judicial partition14 of the said properties before the RTC in Quezon City on May 31. respondent would still go home to his wife usually in the wee hours of the morning. allowances and commissions. petitioner elevated the matter to the CA asserting that she is the pro indiviso owner of one-half of the properties in dispute. petitioner averred that she and respondent started to live together as husband and wife in 1979 without the benefit of marriage and worked together as business partners.

i.. the record shows that what the trial court determined therein was the ownership of the subject realties – itself an issue correlative to and a necessary adjunct of the claim of co-ownership upon which appellant anchored her cause of action for partition. it would be premature to effect a partition of the properties. To our mind.e.26 Hence. misplaced.25 Unimpressed with petitioner’s arguments. Rather than the validity of said certificates which was nowhere dealt with in the appealed decision. the issue of whether the plaintiff is indeed a co-owner of the property sought to be partitioned and. first. that the rule on the indefeasibility of a Torrens title applies only to original and not to subsequent registration as that availed of by the parties in respect to the properties in litigation. the court must initially settle the issue of ownership for the simple reason that it cannot properly issue an order to divide the property without first making a determination as to the existence of co-ownership. explaining in the following manner: Appellant’s harping on the indefeasibility of the certificates of title covering the subject realties is. to say the least. This is precisely what the trial court did when it discounted the merit in appellant’s claim of co-ownership. the inapplicability of said principle to the case at bench is even more underscored by the admitted falsity of the registration of the selfsame realties in the parties’ name as husband and wife. It bears emphasizing. The same dearth of merit permeates appellant’s imputation of reversible error against the trial court for supposedly failing to make the proper delineation between an action for partition and an action involving ownership. second – assuming that the plaintiff successfully hurdles the first – the issue of how the property is to be divided between plaintiff and defendant(s). Ownership cannot be passed upon in a partition case. . an action for partition may be seen to present simultaneously two principal issues. Until and unless the issue of ownership is definitely resolved. Otherwise stated. Typically brought by a person claiming to be co-owner of a specified property against a defendant or defendants whom the plaintiff recognizes to be co-owners. II. The partition agreement duly signed by respondent contains an admission against respondent’s interest as to the existence of co-ownership between the parties. the appellate court denied the appeal. Petitioner also contended that it is improper to thresh out the issue on ownership in an action for partition.attack contrary to law and jurisprudence. this petition premised on the following arguments: I. moreover.

partition is proper in the premises and an accounting of . An action for partition cannot be defeated by the mere expedience of repudiating co-ownership based on self-serving claims of exclusive ownership of the properties in dispute. as amended. with an adjudgment that a co- ownership does in truth exist. which we feel has been squarely threshed out in the decisions of both the trial and appellate courts. Thus: The first phase of a partition and/or accounting suit is taken up with the determination of whether or not a co-ownership in fact exists. Whether an action for partition precludes a settlement on the issue of ownership. or industry. Whether the Torrens title over the disputed properties was collaterally attacked in the action for partition. II. V. not otherwise legally proscribed) and may be made by voluntary agreement of all the parties interested in the property. Garcia28 is definitive. IV. It may end. the last argument is essentially a question of fact. and a partition is proper (i. on the other hand. III. We deem it wise not to disturb the findings of the lower courts on the said matter absent any showing that the instant case falls under the exceptions to the general rule that questions of fact are beyond the ambit of the Court’s jurisdiction in petitions under Rule 45 of the 1997 Rules of Civil Procedure. We find the petition bereft of merit.. The issues may be summarized into only three: I. or partition is legally prohibited. and III. There. This phase may end with a declaration that plaintiff is not entitled to have a partition either because a co-ownership does not exist. Whether respondent is estopped from repudiating co-ownership over the subject realties. we explained that the determination as to the existence of co-ownership is necessary in the resolution of an action for partition. Our disquisition in Municipality of Biñan v.e. property. The properties involved were acquired by both parties through their actual joint contribution of money. A Torrens title is the best evidence of ownership which cannot be outweighed by respondent’s self-serving assertion to the contrary. 27 Noticeably.

does not even have any rightful interest over the subject properties. or . it would be premature to effect a partition of the disputed properties. mere issuance of the certificate of title in the name of any person does not foreclose the possibility that the real property may be under co-ownership with persons not named in the certificate. In contrast. the same is premised on the existence or non-existence of co-ownership between the parties. therefore. Indubitably.31 Would a resolution on the issue of ownership subject the Torrens title issued over the disputed realties to a collateral attack? Most definitely. There is no dispute that a Torrens certificate of title cannot be collaterally attacked. Petitioner insists she is a co-owner pro indiviso of the five real estate properties based on the transfer certificates of title (TCTs) covering the subject properties.rents and profits received by the defendant from the real estate in question is in order. the title referred to by law means ownership which is. represented by that document. the complaint will not even lie if the claimant.30 More importantly. more often than not.) While it is true that the complaint involved here is one for partition. Title as a concept of ownership should not be confused with the certificate of title as evidence of such ownership although both are interchangeably used.36 In fact. the latter only serving as the best proof of ownership over a piece of land. 35 Moreover. xxx The second phase commences when it appears that "the parties are unable to agree upon the partition" directed by the court. This second stage may well also deal with the rendition of the accounting itself and its approval by the [c]ourt after the parties have been accorded opportunity to be heard thereon. x x x29 (Emphasis supplied. or petitioner in this case. until and unless this issue of co-ownership is definitely and finally resolved. What cannot be collaterally attacked is the certificate of title and not the title itself.32 but that rule is not material to the case at bar. 33 The certificate referred to is that document issued by the Register of Deeds known as the TCT. and an award for the recovery by the party or parties thereto entitled of their just share in the rents and profits of the real estate in question. The certificate cannot always be considered as conclusive evidence of ownership. Ownership is different from a certificate of title. it would not.34 Petitioner apparently confuses title with the certificate of title.] partition shall be done for the parties by the [c]ourt with the assistance of not more than three (3) commissioners. placing a parcel of land under the mantle of the Torrens system does not mean that ownership thereof can no longer be disputed. In that event[. or that the registrant may only be a trustee. Respondent maintains otherwise.

petitioner herself admitted that she did not assent to the Partition Agreement after seeing the need to amend the same to include other matters. The trial court ruled that respondent was forced to litigate and engaged the services of his counsel to defend his interest as to entitle him an award of P100. and (d) be adverse to the admitter’s interests. morals. to follow petitioner’s argument would be to allow respondent not only to admit against his own interest but that of his legal spouse as well.1avvphi1 Finally. an admission must (a) involve matters of fact. unless the waiver is contrary to law. good customs or prejudicial to a third person with a right recognized by law. public order. Respondent is not allowed by law to waive whatever share his lawful spouse may have on the disputed properties. we rule in the negative. As to the award of damages to respondent. Basic is the rule that rights may be waived. but may be the best evidence thereof. Petitioner does not have any right to insist on the contents of an agreement she intentionally refused to sign. and not of law. 37 Needless to say. otherwise it would be self-serving and inadmissible. as to whether respondent’s assent to the initial partition agreement serves as an admission against interest. Moreover.that other parties may have acquired interest over the property subsequent to the issuance of the certificate of title. Unlike the trial court. we do not commiserate with respondent’s predicament. we do not subscribe to the trial court’s view that respondent is entitled to attorney’s fees. registration does not vest ownership over a property. Admissions of a party. 26. – The act.000. But we note that in the first . in that the respondent is deemed to have admitted the existence of co-ownership between him and petitioner.00 as attorney’s fees. 40 Curiously. An admission is any statement of fact made by a party against his interest or unfavorable to the conclusion for which he contends or is inconsistent with the facts alleged by him. (b) be categorical and definite. To be admissible. which provides: Sec.38 Admission against interest is governed by Section 26 of Rule 130 of the Rules of Court. (c) be knowingly and voluntarily made. public policy. declaration or omission of a party as to a relevant fact may be given in evidence against him. basic of which is a determination as to whether the parties have the right to freely divide among themselves the subject properties. who may also be lawfully entitled co-ownership over the said properties. 39 A careful perusal of the contents of the so-called Partition Agreement indicates that the document involves matters which necessitate prior settlement of questions of law.

petitioner.place. respondent’s act of representing himself and petitioner as husband and wife was a deliberate attempt to skirt the law and escape his legal obligation to his lawful wife. 55149. PANGANIBAN.R. Respondent Bayani S.00 as attorney’s fees in respondent’s favor is DELETED. Manipon without being entitled to any payment from the latter. therefore. Jr. The September 14. SO ORDERED. The Case Before us is a Petition for Review on Certiorari challenging the October 25. for the law cannot be used as a shield for fraud. 67596 is AFFIRMED with MODIFICATION.000. Secondly. 171497 to [respondent] Rosita C. it was respondent himself who impressed upon petitioner that she has a right over the involved properties. LU. the preferential right of a first registrant in a double sale is always qualified by good faith. 2001 Resolution of the Court of Appeals1 (CA) in CA-GR CV No. 2002 FRANCISCO H. No costs. the petition is DENIED. Spouses ORLANDO and ROSITA MANIPON. WHEREFORE. without prejudice to any claim his legal wife may have filed or may file against him. 2000 Decision and the February 9. On the other hand. is hereby declared the sole owner of the disputed properties. respondents. J."2 The assailed Resolution denied the Motion for Reconsideration. The award of P100. 147072 May 7. vs. G. 3 .: The registration of a sale of real estate will not protect a buyer in bad faith.R. Samoy. premises considered. has no one but himself to blame the consequences of his deceitful act which resulted in the filing of the complaint against him. CV No. The assailed Decision disposed as follows: "WHEREFORE. the appealed Decision is hereby AFFIRMED with MODIFICATION in the sense that [petitioner] is directed to convey Lot 5582-B-7-D covered by TCT No. No. 2004 Decision of the Court of Appeals in CA-G. Respondent.

U-4399. 1990. which was also being occupied by them. [Respondents] also asserted that [petitioner] had knowledge of their claim over the said property . Juan Peralta mortgaged the aforesaid lot to Thrift Savings and Loan Association. 1981. Urdaneta. 1990. 1990. [petitioner] filed the present action alleging therein that he is the owner of the lot in question including that which was being occupied by [respondents.789. The said [D]eed was not registered with the Registry of Deeds. Pangasinan. The latter in turn sold the same on July 15.078 square-meter lot he owned. 1989. The said lot is now covered by TCT No. on August 30. Inc. The aforesaid [D]eed was however also not registered.000. Pangasinan.1âwphi1. 1983. 1988 in the amount of P80. Juan Peralta agreed to sell by installment to the said spouses 350 square meters of the 2. on the lot in question. [petitioner] through counsel wrote the [respondents] regarding the presence of the latter's house. "In the Answer filed by [respondents]. The Facts The facts of the case are summarized in the assailed Decision as follows: "On May 9. one of which is Lot 5582-B-7-D.000. they claim that [petitioner] is a buyer in bad faith because even before he bought the 2. Petitioner] further claims that his ownership was confirmed by the Regional Trial Court of Urdaneta. covered by Transfer Certificate of Title (TCT) No.18 which was the highest bidder. he knew for a fact that they already bought Lot 5582-B-7-D from the original owner of the said lot and have been residing therein since 1981. with an area of 339 square meters covering the lot which was earlier sold by installment to [respondents]. Juan Peralta executed a [D]eed of [S]ale by installment in favor of spouses Orlando and Rosita Manipon [herein respondents]. Thereafter. "On June 10.00 to the [petitioner].078 square-meter lot.00 for the subject lot. Juan Peralta executed a [D]eed of [S]ale in favor of [respondents] after the couple paid a total amount of P8. Therein. He also averred that for reasons unknown to him.nêt "On January 22. 137911 and located at Barrio Dilan. [respondents] were claiming ownership of Lot 5582-B-7-D and have constructed a house thereon on January 22. [petitioner] caused the subdivision of the said lot into five (5) lots. 171497. in Civil Case No. (TSLAI). In the interim. or on July 30. on February 26. Branch 49. 1981. He however failed to pay the loan he obtained for which the mortgage was constituted and so the same was judicially foreclosed and sold to TSLAI for P62. Hence. Efforts were apparently made by both parties to settle the brewing dispute but to [no] avail.

this Petition.051. The RTC disposed as follows: "WHEREFORE. "3).00 paid by the latter to him. is ordered to refund to the defendants Manipons the amount of P18. Juan Peralta. Indeed. 171497 after paying the sum of P13. even before he purchased the property from the loan association in 1990. x x x. the trial court rendered the questioned judgment. he waited more than ten (10) years before contesting respondents' occupation and possession of the land. x x x no pronouncement as to damages in favor [of] or against either of the parties. "Trial ensued and thereafter. The third-party defendant. IN THE LIGHT OF THE FOREGOING. foreclosed and eventually purchased. He admitted knowing that respondents had constructed a house on the disputed lot in 1984. The [petitioner] is hereby ordered to convey to the herein [respondent] Rosita Manipon.078 square-meter lot of Juan Peralta. "2). He bought the entire property from the foreclosing bank."4 (Citations omitted) Ruling of the Trial Court The trial court ruled that petitioner was not a buyer in good faith despite the fact that he was able to register his ownership of the disputed lot."5 Ruling of the Court of Appeals The CA affirmed the Decision of the trial court with the modification that respondents would no longer be required to pay petitioner the value of the disputed portion in a "forced sale. because he feared that he might lose what he had earlier bought in 1981 – a 350 square meter lot which also formed part of the mother lot. the Court renders judgment as follows: "1). because when the whole lot was foreclosed they shared the same problem as [petitioner] also bought a lot with the 2.6 . (defendant Orlando Manipon is already dead) the lot consisting of 339 square meters denominated as Lot 5582-B-7-D and covered by Transfer Certificate of Title No.000.50 plus legal interest to the herein [petitioner] anytime after the finality of this decision. Hence." The appellate court said that petitioner knew that Lot 5582-B-7-D had already been sold by Juan Peralta to respondents before the mother lot was mortgaged.

The Issues In his Memorandum. Lot 5582-B-7-D. Whether respondents' claim over the lot can rise [above that of] their predecessor in interest Juan Peralta[. although respondents purchased the disputed lot by installment on May 9. 1981 and fully paid for it on May 30. although respondents had bought it first. Second. Whether petitioner was in bad faith in the acquisition of the lot in question[. And even assuming without admitting that petitioner is under obligation to convey the lot in question in favor of respondents. respondents' ownership follows that of their vendor who mortgaged to the bank his title to the mother lot and failed to redeem it.]"8 These issues can be summed up into three questions: (1) who has a better right to the disputed property? (2) was petitioner a purchaser in bad faith? and (3) what should be the purchase price of the disputed lot? This Court's Ruling The Petition is partly meritorious. 1988.] "3. The mortgage was foreclosed and the property sold on July 10. (TSLAI).7 petitioner raises the following issues: "1. 1981. Juan Peralta mortgaged the mother lot – including the disputed portion – to the Thrift Savings and Loan Association. Who between petitioner and respondents have a better right of ownership over the lot in question.00 per square meter[.] "4. First. with an area of 339 square meters? "2.] "5. 1983. First Issue: Better Right to the Disputed Lot Petitioner claims to have a better right to the disputed portion of the real property. they failed to register their sale with the Registry of Deeds. Petitioner avers that. on June 18. In the meantime. he was the first to register his purchase of the mother lot. whether the consideration of the lot be paid by respondent is P2. Inc. .000. Whether respondents are under estoppel to question petitioner's ownership over the lot in question[.

a person who by deed or conduct induces another to act in a particular manner is barred from adopting an inconsistent position.14 A holder in bad faith of a certificate of title is not entitled to the protection of the law. the registration will constitute x x x bad faith. bought the whole lot. Thus.11 It was not established as a means of acquiring title to private land because it merely confirms. In estoppel. Registration is not the equivalent of title. The situation will be the same as if there had been no registration. it was petitioner who. and the vendee who first took possession of the real property in good faith shall be preferred."16 Equally important. they did not do anything to perfect their title thereto. On the other hand. they are now estopped from questioning his ownership of it.12 Moreover.Petitioner. or that the property is in the possession of one who is not a vendor. every registered owner receiving a certificate of title in pursuance of a decree of registration and every subsequent purchaser of registered land taking such . for the law cannot be used as a shield for fraud. 15 "When the registration of a sale is not made in good faith. despite having knowledge of the existence of respondents' house on the disputed portion. 1529). attitude or course of conduct that thereby causes loss or injury to another. he knew of respondents' claim of ownership and occupation. but does not confer. hence.000 on July 15. or that another person claims said property under a previous sale. a party cannot base his preference of title thereon. registration only gives validity to the transfer or creates a lien upon the land. 1988. the RTC and the CA have correctly ruled that the preferential right of the first registrant of a real property in a case of double sale is always qualified by good faith under Article 154413 of the Civil Code. We are not convinced. Bad faith renders the registration futile. bought the whole lot from the bank for P80. and will not confer upon him any preferential right. or that this was in dispute. 9 This equitable principle will not apply to respondents. because they exercised dominion over the property by occupying and building their house on it. on the other hand. if a vendee registers the sale in his favor after he has acquired knowledge that there was a previous sale of the same property to a third party. ownership. under Section 44 of the Property Registration Decree (Presidential Decree No. or that there were flaws and defects in the vendor's title. 1988 and registered it in his name on September 23. because the law will not protect anything done in bad faith. 10 Under the Torrens system. Third. He cannot now pretend to be an innocent buyer in good faith. Before acquiring the mother lot from the bank. petitioner claims that from the time respondents fully paid for the lot until they received a Notice to Vacate.

In fact. This 'devil-may-care' attitude of [petitioner] has placed him where he is now. This fact alone should have put him on guard before buying the land. he was not interested in the [respondents'] reason for occupying the said lot[. "One who purchases real estate with knowledge of a defect or lack of title in his vendor cannot claim that he has acquired title thereto in good faith as against the true owner of the land or an interest therein. Having been aware of the 'defects' in the title of TSLAI as far as Lot 5582-B-7-D is concerned. Petitioner is evidently not a subsequent purchaser in good faith. But as he admitted during the trial. respondents have a better right to the property based on the concurring factual findings of both the trial and the appellate courts. His mere refusal to believe that such defect exists. the purchaser of a registered land is not required to go behind the title to determine the condition of the property. and it appears that he had such notice of the defect as would have led to its discovery had he acted . "True. between the parties. foreclosed. We quote with approval the following ruling of the CA: "x x x We are persuaded that [petitioner] knew of the fact that Lot 5582-B-7- D was sold by Juan Peralta to [respondents] before Lot 5582-B-7. Thus. However. still he cannot be considered as a purchaser in good faith because he had personal knowledge of [respondents'] occupation of the lot in question.] all that he was interested in was to buy the entire lot. Consequently. he cannot now claim to be a purchaser in good faith and for value even if he traces his ownership [to] TSLAI which [w]e believe was a purchaser in good faith – the latter not being aware of the sale that transpired between the [respondents] and Juan Peralta before Lot 5582-B-7 was sold to it in a public auction. was mortgaged. if it afterwards develops that the title was in fact defective. [w]e are convinced that the main reason why [petitioner] bought the entire lot from the TSLAI was hi fear of losing the 350 square meter-lot he bought sometime in 1981 which also forms part of Lot 5582- B-7. the mother lot of Lot 5582-B-7-D. 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. even assuming arguendo that [petitioner] was not aware of the sale between Juan Peralta and the [respondents]. Therefore. will not make him an innocent purchaser for value. or his willful closing of his eyes to the possibility of the existence of a defect in his vendor's title. he cannot be entitled to the relief he is seeking before this [c]ourt.certificate for value and in good faith shall hold the same free from all encumbrances. sold and [its ownership] transferred x x x to him. except those noted on the certificate and enumerated therein.

No. 1544 has been held to refer to registration under Act 496 Land Registration Act (now PD 1529) which considers the act of registration as the operative act that binds the land (see Mediante vs. the right of a buyer to rely upon the face of the title certificate and to dispense with the need of inquiring further is upheld only when the party concerned had no actual knowledge of facts and circumstances that should impel a reasonably cautious man to conduct further inquiry. In Cruz vs. 22 June 1984. No.R. at the time of the purchase or before any notice of some other person's claim on or interest in it.R. 58530. potior jure (first in time. knowledge gained by the second buyer of the first sale defeats his rights even if he is first to register. it was held that it is essential. Gonzales. to merit the protection of Art.nêt "The registration contemplated under Art. Garcia vs. 56232. Petitioner's contention is untenable. He alleges that the only reason he spoke to the respondents before he bought the foreclosed land was to invite them to share in the purchase price. second paragraph. 26 December 1984). 129 SCRA 656). Rosabal. Rosabal. A purchaser in good faith or an innocent purchaser for value is one who buys property and pays a full and fair price for it. [12] 900. was not an indication of bad faith. since such knowledge taints his registration with bad faith (see also Astorga vs. 1544.R. 73 Phil 694). 69 SCRA 99. G. On lands covered by . but they turned him down. that the second realty buyer must act in good faith in registering his deed of sale (citing Carbonell vs.G. but it is not the intention that makes one an innocent buyer. Cabaña (G. 159 SCRA 33."17 All told. As aptly explained by Vitug: "The governing principle is prius tempore. Knowledge by the first buyer of the second sale cannot defeat the first buyer's rights except when the second buyer first registers in good faith the second sale (Olivares vs. He might have had good intentions at heart. This.1âwphi1. CA. 95843. Court of Appeals. G.) Conversely. stronger in right). 02 September 1992).19 One cannot close one's eyes to facts that should put a reasonable person on guard and still claim to have acted in good faith. Court of Appeals. he argues.18 Second Issue: Bad Faith Petitioner denies being a purchaser in bad faith. with that measure of precaution which may reasonably be required of a prudent man in a like situation. 1 O. Crisostomo vs.

Bernales vs. the CA modification exempting respondents from paying petitioner is flawed. because the RTC had ordered Juan Peralta to refund the P18. hence. A buyer of real property which is in the possession of another must be wary and investigate the rights of the latter. 75336.000 paid to him by petitioner as the purchase price of the disputed lot. The purchaser is not required to explore farther than what the Torrens title. 39. he pleads that this Court modify the price to P2. if these are indispensable or necessary to the just resolution of the pleaded issues. Sales.24 However. Court of Appeals. Thus. L-26677.50 with legal interest for the conveyance of the disputed portion. 18 October 1988.5025 plus legal interest for Lot 5582-B- 7-D and (2) the third-party defendant Peralta to refund to respondents the P18. Act 496. is equivalent to registration (see Sec. even finality. petitioner admits he was not a purchaser in good faith. Court of Appeals. the buyer cannot be said to be in good faith. when they affirm those of the trial court.051. The only exception is where the purchaser has actual knowledge of a flaw or defect in the title of the seller or of such liens or encumbrances which. without such inquiry. Otherwise. It is well-settled that appellate courts have ample authority to rule on matters not specifically assigned as errors in an appeal. unaffected by any prior lien or encumbrance not noted therein. petitioner did question the conveyance of Lot 5582-B-7-D to respondents upon payment of the said price. Tajonera vs. Instead."20 By his own allegations.051. the purchaser acquires such rights and interest as they appear in the certificate of title. While neither party appealed the issue of the purchase price. as to him. the trial court correctly ordered (1) respondents to pay petitioner 13.000 per square meter. we find no cogent reason to depart from this general rule. G. We are not persuaded. 69 Phil 744. IAC. indicates.R. Third Issue: Proper Purchase Price Petitioner protests respondents' exception from paying him P13.000 . Hernandez vs. upon its face. 27 March 1981). the payment was also effectively put in issue.23 Petitioner has not shown that this case falls under any of those exceptions. Hence. the Torrens System.21 Basic is the rule that the factual findings of the appellate court are given great weight.22 unless they fall under the exceptions enumerated in Fuentes v.

Rodriguez for defendant-appellee. Negros Occidental. 1776 (Exhibit 4).R. No. more or less. Africa & Benedicto for plaintiff-appellant. and was covered by Original Certificate of Title No. The case is. the Petition is PARTLY GRANTED. the latter sold the aforementioned hacienda to Jose Benares (also referred to in some . Capitol Subdivision. issued on August 25. 1935. with an aggregate area of over 502 hectares. the Province of Negros Occidental. the RTC ruling should have been affirmed in its entirety. 1951. 1963 CAPITOL SUBDIVISION. exclusive of interest and costs. On appeal taken by the defendant. Eduardo P. consisting of Lots 378. The assailed Decision and Resolution are AFFIRMED without the MODIFICATION ordered by the CA. L-16257 January 31.nêt WHEREFORE. L-6204. this judgment was. Lot 378 has an area of 22. No. 1956).000. 410. ordered the case remanded to the lower court "for further trial". set aside by the Supreme Court (see G.1âwphi1. 1920. 1205. vs. which. Said Lot 378 is part of Hacienda Mandalagan. originally registered in the name of Agustin Amenabar and Pilar Amenabar. G. 1916.783 sq. PROVINCE OF NEGROS OCCIDENTAL. San Juan. Inc. before us. The main facts are not in dispute. after which another decision was rendered by said court of first instance dismissing plaintiff's complaint and ordering plaintiff to execute a deed conveying Lot 378 to the defendant. and a reasonable compensation for the use and occupation of said lot by the defendant from November 8. once again.. the possession of Lot 378 of the cadastral survey of Bacolod. J. No pronouncement as to costs. this time on appeal by the plaintiff. likewise. SO ORDERED. who would receive double compensation.. the Court of First Instance of Negros Occidental rendered judgment for the plaintiff. in the name of the Amenabars. In short.: Plaintiff. meters.R. On June 28. 407.they had paid for the lot. Arboleda and Jesus S. defendant-appellee. 405. the subject matter of litigation being worth more than P200. CONCEPCION. however. INC. 1452 and 1641 of the aforementioned cadastral survey. seeks to recover from defendant. decided on July 31. The CA ruling would unjustly enrich respondents. plaintiff-appellant. in addition to attorney's fees and costs. On November 30.

For this reason. including said Lot 378. 6295 in his name.documents as Jose Benares Montelibano) for the sum of P300. in lieu of Transfer Certificate of Title No. including said Transfer Certificate of Title No.000. 1924. later. including Lot 378. for the sum of P400. it was discovered that Lot 378 was the land occupied by the Provincial Hospital of . in its stead. in plaintiff's name (Exhibit O). and the Bank acquired the Hacienda. payable in annual installments. Benares. said Original Certificate of Title No. contained a caveat emptor stipulation. to plaintiff herein. RT-1371 — in the name of the Bank. 1926. On February 8. 1921. 6295. Hence. Benares. as purchaser at the foreclosure sale. When. the Bank executed the corresponding deed of absolute sale to the plaintiff (Exhibit Q) and Transfer Certificate of Title No. Wherefore. 1934 (Exhibit P). subject to the condition that. 1931 (Exhibit U-1). Transfer Certificate of Title No. the Bank agreed to sell the Hacienda to Carlos P. on September 29. title would remain in the Bank (Exhibit R). the latter did not take possession of the property for Jose Benares claimed to be entitled to retain it under an alleged right of lease. 17166 0151 — which. The mortgage in favor of the Bank was subsequently foreclosed. Benares transferred his rights. son of Jose Banares. for the sum of P27. under this contract with the Bank. on September 29.991. payable installments. On December 6.ñët At this juncture. executed by the Bank in favor of Carlos P. Carlos P. which completed the payment of the installments due to the Bank in 1949. as set forth in the deed of sale. it should be noted that. 6295 was cancelled and. transfer Certificate of Title No. Soon. Accordingly. until full payment thereof. said Transfer Certificate of Title No. owing to its subsequent loss. 1949. 1949. subject to the first mortgage held by the Bacolod-Murcia Milling Co. in lieu thereof. was issued on March 14. 1äwphï1. 1798. (Exhibit Y-1). Thereafter. upon the execution of the deed of absolute sale (Exhibit Q) by the Bank. Exhibit 21. had to be reconstituted as Transfer Certificate of Title No. Meanwhile. the parties respectfully pray that the foregoing stipulation of facts be admitted and approved by this Honorable Court. or on November 8. covering 378 was issued. including Lot 378. or on March 12.000. had been mortgaged by Jose Benares to the Bacolod-Murcia Milling Co. plaintiff took steps to take possession the Hacienda. the deed of promise to sell. 17166 (or reconstituted Transfer Certificate of Title RT-1371). in pursuance of a decision of the Court of First Instance of Negros Occidental dated September 29.74 (Exhibit Y-2). 1776 was cancelled and Jose Benares obtained. covering Lot 378. without prejudice to the parties adducing other evidence to prove their case not covered by this stipulation of facts. the Hacienda. 1935. Jose Benares again mortgaged the Hacienda. despite the acquisition of the Hacienda in 1934 by the Bank. on the Philippine National Bank. These transactions were duly recorded in the office of the Register of Deeds of Negros Occidental and annotated on the corresponding certificate of title.

This decision appealed from in effect decided this question in the affirmative and declared that plaintiff merely holds it in trust for the defendant. on July 10. among the lands sought to be expropriated in said case was Lot 377 of the aforementioned cadastral survey. in the sense that the . 1924-1925.. that the aforementioned expropriation case was "amicably settled as between the parties herein. that since then it had occupied said lot publicly. or on October 4. 1926.000. 1926. 16269 (dated December 31. in view of which it ordered the former to convey said lot to the latter. In its answer dated June 24..Negros Occidental. Jose Benares in favor of the Province purposely for hospital site". to the defendant (Exhibit BB). 1937). belonging to one Anacleta Agsam. "for some reason or other and for cause beyond comprehension of the defendant title thereto was never transferred in the name of said defendant". defendant maintained that it had acquired Lot 378 in the year. plaintiff made representations with the proper officials to clarify the status of said occupation and. 3041 of the Court of First Instance of Negros Occidental for the expropriation of the hospital site of said province. 1950. In an amended answer.. that. and did in fact pay to Jose Benares the assessed value of Lot 378 . according the testimony of Jose Benares. The main question for determination in this case is whether or not defendant herein had acquired Lot 378 in the aforementioned expropriation proceedings. Immediately. defendant alleged.. president and general manager of plaintiff corporation.. aside from the fact that Alfredo Montelibano. the controlling stockholder. thereafter. This conclusion is predicated. also. in whose favor the corresponding transfer certificate of title (Exhibit BB-2) was issued on July 12. that said lot had been placed in defendant's name for assessment purposes under Tax Declaration No. notoriously and continuously as owner thereof. for plaintiff knew then that the provincial hospital was where it is up to the present. and did not declare said lot in its name for assessment purposes until 1950. who sold it. was the first City Mayor of Bacolod which contributed to the support.... 1950. which was completed in 1926. not being satisfied with the explanations given by said officials. that immediately after the commencement of said proceedings in 1924. the expropriation of Lot 378 was settled amicably upon payment to him of the sum of P12. adversely. that. through expropriation proceedings. that. operation and maintenance of said hospital. and whatever consideration pertaining to said lot in excess of its assessed value which was paid by the Province would be donated and was in fact donated by said . substantially. Province of Negros Occidental would pay . namely that case No. 1924. it brought the present action on June 10. upon the following premises. 1950. and that plaintiff had acted in bad faith in purchasing said lot from the Bank in 1935. 1949. and that defendant's failure to secure the corresponding transfer certificate of title to Lot 378 . was actually commenced on January 26. it took possession of said lot and began the construction thereon of the provincial hospital. dated November 8.

4.000 for its 22.). all of which have been finally decided against the former. whereas Marco averred that agreement was merely oral. meters. and to donate to the Government the difference between this sum and the true value of the property. . full faith and credence. subsequently.000 on November 7. but Benares affirmed that he was first offered P300 per hectare. who positively assured the Court that the expropriation case "was not yet terminated" and that "negotiations were still pending" for the acquisition of Lot 378 by the Government when he retired from the service in 1934. at the rate of P1. about "2 or 3 days" after the Government had taken possession of the land. because: 1. 405-B" in the plan (Exhibit X. although.was due to "the mistaken notion or belief that said lot forms part of Lot No. 1928. (b) he claimed to have received said sum of P12. he agreed to sell Lot 378. Jose Benares appears to be strongly biased and prejudiced against the plaintiff and its president.00 "in the year 1924 or 1925". which the Government agreed to pay. for: (a) Jose Benares asserted that there was a written compromise agreement between him and the Government. he said that Rafael Alunan and Mariano Yulo had prevailed upon him to accept P1. also. which was P430. which he rejected. Said testimony was contradicted by that of defendant's witness Jose Marco.000 by the Government. and to have sent the money next day to Pilar Amenabar. however.000.000 a hectare. former deputy clerk of court of Negros Occidental. The testimony of Jose Benares does not deserve. Thus: (a) he testified to having been paid P12. and there have been four (4) litigations between Jose Benares and plaintiff.000 a hectare at which. and that he later demanded P1. Jose Benares was. the provincial treasurer of Negros Occidental at the time of the expropriation. he would have us believe.000 per hectare. he should have received less than P3. although. as compensation for Lot 378. 2.783 sq. and (b) Marco stated that Benares had agreed to accept. contradicted by defendant's witness Ildefonso Coscolluela. 3. but the latter acknowledged to have received the said sum of P12. the assessed value thereof. for the former believes that the latter had "manipulated" to exclude him from plaintiff corporation. The testimony of Jose Benares is extremely contradictory.

1926.. 1776. Neither could said lot have been expropriated subsequently thereto without the Bank's knowledge and participation. when contrasted with the absence of a similar deed of assignment and of a transfer certificate title in favor of the Province as regards Lot 378. 3. since March 12. thus indicating. The Court had to examine carefully and minutely every single piece of evidence adduced by both parties in order to arrive at the correct solution of the mystery. For instance: 1. several circumstances strongly indicate that no compromise agreement for the acquisition of the land by the Government had been reached and that the expropriation had not been consummated. of another title in the name of the Province. 1935 (Exhibit R). 1921. on November 8. duly registered and annotated. in the name of Jose Benares. The only entries in the docket relative to the expropriation case refer to its filing and the publication in the newspaper of the corresponding notices (Exhibit 1). 1935. What is more. the latter was not made a party in the expropriation proceedings. it was explicitly stated that portions of Lots 405.. was not cancelled until September 28. forming part of said Hacienda and designated as Lots 405-A. The registration of the deed of sale of Lot 377 by Anacleta Agsam to the Government. in the deed executed by the Bank. inter alia. which would not have accepted the mortgage had Lot 378 not belonged then to the mortgagor. Moreover. 4. by necessary implication. 407-A. Yet. On December 26. followed by the cancellation of the certificate of title in her name and the issuance. that Lot 378 had not been expropriated. on Transfer Certificate of Title No. The decision appealed from says: . It is evident that there were no further proceedings in connection with the expropriation case and the chances are that the case was dismissed..Upon the other hand. The property was mortgaged to the Bacolod-Murcia Milling Co. 407 and 410.. in lieu thereof. had been expropriated by the Provincial Government of Negros Occidental. The Court believes that the failure of the government to secure the corresponding . strongly suggest that no such assignment or agreement with respect to Lot 378 had been made or reached. 2. and this mortgage. promising to sell the Hacienda Mandalagan to Carlos Benares. 407-B and 410-A. Jose Benares constituted second mortgage in favor of the Bank. Lot 378 could not have been expropriated without the intervention of the Milling Co.

405. Exhibit X. The plan shows that while all the subdivided lots were properly identified by lot numbers. A close examination of the latter shows that the boundaries of said portion are not delimited on the plan. 378. More important still. which adjoins it. transfer of title to Lot 378 lies in the mistaken notion or belief that said lot forms a part of Lot 405-B. there were no further proceedings in said case.. embracing lots covering over 22 hectares for the Capitol and hospital sites. much less by government engineers. Formento. This conclusion was arrived at after examining closely the plan. said Lot . which had been expropriated by the Province of Negros Occidental. To begin with. that particular portion at the lower corner of the plan encircled with red pencil. The absence of Lot 378 from said enumeration and the explicit statement in Exhibit X to the effect that it refers to the "Capitol Site". within a circle in red pencil. and defendant has not even tried to prove. 400. the following appears in bold letters: "Subdivision & Consolidation PLAN of Lots Nos. said portion. 1927 by public land surveyor. the lower court merely speculated about the "chances that the (expropriation) case was dismissed. now in question. during the trial. likewise. there is. we find ourselves unable to concur in the foregoing view. Negros Occidental (Capitol site)". as including the hospital site. for he testified that the expropriation case was still pending in 1934. Exhibit X. 406. is not part of the land covered by the plan Exhibit X. Although said decision appears to have been prepared with the conscientiousness and moral courage that account for the well earned reputation and prestige of the Philippine judiciary. when there is sufficient proof that Jose Benares was paid and he executed the deed of sale in favor of the government. This lack of reasonable explanation why the government failed to secure the corresponding certificate of title to lot 378. Exhibit X-1. negates the possibility of its being mistaken by any body. The fact that this particular portion was not labelled with the corresponding lot number might have misled the authorities to believe that it formed a part of lot 405-B. 403. no evidence whatsoever that the authorities had been "misled . Hence. on the right hand side of Exhibit X. marked Exhibit X-1. Ildefonso Coscolluela. and. when he ceased to be the provincial treasurer. although separated by the creek. to believe" that the portion at the lower corner of said plan — which was enclosed.. Mr. the contrary was intimated by defendant's witness. hence.. where the hospital building was constructed. is not labelled with the corresponding lot number and that portion is precisely lot No. 401. that the expropriation case had ever been dismissed insofar as Lot 378 is concerned. and the record before us suggests that since the Province took possession of the land in 1924 or 1925 and completed the construction of the hospital in 1926. 407 and 410 Bacolod Cadastre as surveyed for the Provincial Government of Bacolod." By the way. This plan was prepared for the government on May 12. and marked as Exhibit X-1 — formed part of Lot 405-B. In fact. With respect to the plan. there is no evidence.

affecting another property of Jose Benares. not Lot 405. 12 and 13) show that the Government had always regarded Lot 378. against him. it held that plaintiff was "not a purchaser in good faith for having constructive knowledge of defendant's possession of the property at the time it was bought by the plaintiff". which must be held. its price could not have exceeded P3. the evidence on record is far from sufficient to establish the alleged acquisition by the defendant of Lot 378. and. as owner thereof". he did not have. 378 was erroneously or inadvertently included by the deeds of sale (Exhibits Q & R) executed by the Philippine National Bank in favor of the plaintiff subdivision and that same lot was occupied by the defendant government for the provincial hospital for the last 34 years. cannot suffice to warrant — in the face of documentary evidence to the contrary — the conclusion that Lot 378 has already been acquired by the Government. specially the assessor's field sheets and declarations of real property for tax purposes (Exhibits 9. Evidently. Thus.000 a hectare allegedly agreed therefor. hence. and because "of the overwhelming fact that lot No. the very evidence for the defendant herein. because "it took the plaintiff 14 years to sleep over the supposed rights to take possession of lot No. 11. appears to have been instituted in the Court of First Instance of Negros Occidental. How about the P12.00. at least. because the hospital was already constructed in Lot 378 since 1926 and the lot was declared in the name of the Government" and "when plaintiff bought the lot in 1935 the purchaser should have inquired as to its location and improvement". another expropriation case for the Capitol site. therefore. to be the exclusive property of plaintiff herein. 378". it should be noted that. was not included in the mortgage constituted by him in favor of the Philippine National Bank. Yet. In this connection. 10. said possibility of mistake.378. which was affected by the hospital site. aside from the expropriation proceedings for the hospital site. as one intended for Lot 378. as part of the Provincial Hospital Site.000 received by Jose Benares from the Government and applied by him to the payment of his debt to Pilar Amenabar? Said amount could not possibly be the price of Lot 378. The lower court entertained no doubts about the veracity of the testimony of plaintiff's president to the effect that he did not know until 1949 that the land on which the Provincial Hospital Building stands is Lot 378. . for. an accurate recollection of the events or transactions affecting his properties. Lastly.000. his testimony may not be relied upon. Jose Benares may have mistaken the payment for his land included in the Capitol site. and that Lot 378. In any event. And this possibility may amount to a probability when we consider that he erroneously believed that there had been only one expropriation case. because Carlos P. Benares — whose right to buy the Hacienda Mandalagan from the Bank was acquired by plaintiff — "is a part owner of the Capitol Subdivision and holds a responsible position therein". which would be remote. if any. instead of two cases. at the rate of P1.

G. plaintiff is entitled to recover from the defendant the fair and full equivalent to Lot 378. to sell the property to Carlos P. subsequently conveyed his rights to plaintiff herein. In the case at bar plaintiff had no such actual knowledge. October 31. L-13479. As regards the compensation that.R. and so hold. the plaintiff may demand what is due by reason of the expropriation of said lot. or on December 26. in 1934.R. and the mortgage.As above stated. the title to the property was in the name of the Bank. 1926. and to facilitate transactions relative thereto giving the public the right to rely upon the face of Torrens certificate of title and to dispense with the of inquiring further. G. Manacop. it being an established fact that he was not aware until 1949 that the land on which the provincial hospital stood was Lot 378. we find that plaintiff herein is a purchaser in good faith and for value.. When the Bank agreed on November 8. February 27. as of the time when possession . Prior to this date. that. as well as when the bank executed the deed of absolute sale in plaintiff's favor on September 20. since the latter's right to expropriate Lot 378 is not contested. there is a total absence of evidence that this fact was known to Carlos P. Considering that sugar centrals as well as banks are known to have an array of experienced and competent lawyers. "Upon the other hand. Jose Benares. In short. Galindez. Cansino. Neither may such knowledge be deduced from the circumstances that he is a son of its former owner. Jr. Indeed. it cannot be said that plaintiff was not justified in assuming that said institutions had scrutinized the background of Lot 378 and were satisfied that the same belonged to the mortgagor when said mortgages were constituted. was not cancelled until September 28. plaintiff's president did not know until 1949 that lot 378 was the very land occupied by the provincial hospital. thru foreclosure proceedings. Benares before 1949. the main purpose of the Torrens System is to avoid possible conflicts of title in and to real estate.. as such. and to the Bank when said deed of sale was executed. Furthermore. No. said lot was mortgaged to the Bacolod-Murcia Milling Co. we are of the opinion. vs. and the lower court conceded. No. L-19940. or before the expropriation case for the hospital site had begun. March 30. it may collect from the defendant. except when the party concerned has actual knowledge of facts and circumstances that should impel a reasonably cautious man to make such further inquiry (Tiburcio vs. 1949. and is seemingly conceded. Revilla vs. and that this lot was one of the properties mortgaged by him to the Bank. as well as annotated on the corresponding certificate of title. for even the latter appears not to be well-posted on the status of his properties. which acquired title thereto. 1959. In short. 1960. Benares and the latter.000 received by him from the Government was not meant for Lot 378. 1961). Jose Benares did not apparently know that there were two (2) expropriation proceedings effecting said properties: that the P12. since the year 1921. Lot 378 was subjected to a second mortgage in favor of the Bank. L-13791. however. 1935. PHHC. Moreover. duly registered. 1935.

of the corresponding decision thereon. The case should be remanded. No. It is so ordered. thereafter.196 (M) and TCT No. appealed decision is hereby REVERSED and SET ASIDE and judgment is rendered ordering. the decision appealed from is hereby reversed and the records remanded to the lower court for further proceedings.R. Da Jose. on the aggregate sum due to the plaintiff. TCT No. as above stated. MARTINEZ. The dismissal of the complaint. 44706 entitled "Ricardo Cheng. should be deducted. RAMON B. GENATO and ERNESTO R. 129760 December 29. 1998 RICARDO CHENG. The cancellation of the annotations of the defendant-appellant's Affidavit to Annul Contract to Sell and plaintiff-appellee's Notice of Adverse Claim in the subject TCT's. Genato. The dispositive portion of the CA Decision reads: WHEREFORE.. T-76. if any. WHEREFORE. 1997 in CA-G.197 (M). namely. with costs against the defendant. therefore. Ramon B. DA JOSE & SOCORRO DA JOSE. Da Jose & Socorro B.: This petition for review on certiorari seeks to annul and set aside the Decision of the Court of Appeals (CA) 1 dated July 7. based on the foregoing. J. 2. T-76. with interests. vs. plus consequential damages — including attorney's fees — from which consequential damages the consequential benefits. No.thereof was actually taken by the defendant.R. respondents. defendant-appellant. petitioner. 1994. CV No. . G. plaintiff-appellee vs. Branch 96 of Quezon City dated January 18. from and after the date of said actual taking. Intervenors-Appellants" which reversed the ruling of the Regional Trial Court. to the lower court for the reception of evidence on the date of said actual taking and the amount of compensation collectible from the defendant. at the legal rate. Ernesto R. and the rendition. 1..

000.00. Genato (Genato) is the owner of two parcels of land located at Paradise Farms. respondent Genato entered into an agreement with respondent- spouses Ernesto R. The antecedents of the case are as follows: Respondent Ramon B. . Bulacan covered by TCT No. Philippine Currency per square meter. exemplary damages of P50. On September 6. Payment by the intervenors-appellants of the remaining balance of the purchase price pursuant to their agreement with the defendant- appellant to suspend encashment of the three post-dated checks issued since 1989.197 (M) 4 with an aggregate area of 35. The contract was in a public instrument and was duly annotated at the back of the two certificates of title on the same day. of which the amount of FIFTY THOUSAND (P50.821square meters. T-76. The return by defendant-appellant Genato of the P50. The agreement culminated in the execution of a contract to sell for which the purchase price was P80. San Jose del Monte.00) PESOS shall be paid by the VENDEE to the VENDOR as partial down payment at the time of execution of this Contract to Sell.000. 2 SO ORDERED.196 (M) and TCT No. and 6. Da Jose and Socorro B. Da Jose (Da Jose spouses) over the above- mentioned two parcels of land. 4.00 in exemplary damages.196 (M) 3 and TCT No. and to defendant-appellant.000. Payment by plaintiff-appellee Cheng of moral damages to herein intervenors-appellants Da Jose of P100. T- 76. and costs of suit.000. T-76. 3.000. more or less.00 paid to him by the plaintiff-appellee Cheng.00 per square meter. The amounts payable to the defendant-appellant may be compensated by plaintiff appellee with the amount ordered under the immediately foregoing paragraph which defendant-appellant has to pay the plaintiff-appellee.197 (M) in favor of intervenors-appellants Spouses Da Jose. Clauses 1and 3 thereof provide: 1.000.00 in attorney's fees.00. 1989.00) PESOS.000. P50. Ordering the execution by the defendant-appellant Genato of the Deed of Absolute Sale over the subject two lots covered by TCT No.00. That the purchase price shall be EIGHTY (P80. attorney's fees of P50. 5. of P100. T-76.

Pending the effectivity of the aforesaid extension period. 1989. and only after having satisfactorily verified and confirmed the truth and authenticity of documents. The affidavit contained. no annotation of the said affidavit at the back of his titles was made right away. That this affidavit is being executed to Annul the aforesaid Contract to Sell for the vendee having committed a breach of contract for not having complied with the obligation as provided in the Contract to Sell. However. 1989. and without due notice to the Da Jose spouses. asked for and was granted by respondent Genato an extension of another 30 days — or until November 5. not having finished verifying the titles mentioned in clause 3 as aforequoted.00. xxx xxx xxx 3. 1989.00 shall be paid thirty (30) days after the execution of the Contract. the extension was granted on condition that a new set of documents is made seven (7) days from October 4. and that no restrictions. limitations. xxx xxx xxx That it was agreed between the parties that the agreed downpayment of P950. a breach of contract. 7 on October 13. Moreover. the following paragraphs. Thirty (30) DAYS after the execution of this contract. 6 This was denied by the Da Jose spouses. herein petitioner Ricardo Cheng (Cheng) went to Genato's residence and expressed interest in buying the subject properties. the Da Jose spouses. 8 On October 24. Genato . according to Genato.000. representing the full payment of the agreed Down Payment. 1989. the VENDEE shall pay to the VENDOR. On October 4. and developments imposed on and/or affecting the property subject of this contract shall be detrimental to his interest. inter alia. That the VENDEE.00) PESOS. Genato executed an Affidavit to Annul the Contract to Sell. On that occasion. 1989. Genato showed to Ricardo Cheng copies of his transfer certificates of title and the annotations at the back thereof of his contract to sell with the Da Jose spouses. that is on or before October 6. after which complete possession of the property shall be given to the VENDEE to enable him to prepare the premises and any development therein. 1989. The supposed VENDEES failed to pay the said full downpayment even up to this writing. NINE HUNDRED FIFTY THOUSAND (P950. Philippine Currency.

T. 262702. 1989. written in this wise: 10/24/89 Received from Ricardo Cheng the Sum of Fifty Thousand Only (P50. 1989. Despite these.821 Sq. they met Genato by coincidence. 10 The following day. etc.000-) as partial for T-76196 (M) T-76197 (M) area 35. Meycauayan.00 upon the assurance by Genato that the previous contract with the Da Jose spouses will be annulled for which Genato issued a handwritten receipt (Exh.also showed him the aforementioned Affidavit to Annul the Contract to Sell which has not been annotated at the back of the titles. The latter were shocked at the disclosure and protested against the rescission of their contract. Paradise Farm.000.) Ramon B. Cheng called up Genato reminding him to register the affidavit to annul the contract to sell. Gaya-Gaya. On the same day. "D").m. or on October 26. Genato caused the registration of the Affidavit to Annul the Contract to Sell in the Registry of Deeds. 1989. G. later on . and that they were willing and able to pay the balance of the agreed down payment. 11 While the Da Jose spouses were at the Office of the Registry of Deeds of Meycauayan. Genato 9 10/24/89 On October 25. that the period was still in effect. Genato deposited Cheng's check. Check # 470393 (SGD. After being reminded that he (Genato) had given them (Da Jose spouses) an additional 30-day period to finish their verification of his titles. San Jose Del Monte P70/m2 Bulacan plus C. Bulacan as primary entry No. acting on Cheng's request. Cheng went ahead and issued a check for P50. It was only then that the Da Jose spouses discovered about the affidavit to annul their contract. Bulacan on October 27.

000.00 and expressed regret for his inability to "consummate his transaction" with him. Genato sent a letter 13 to Cheng (Exh.680. however. 1989. on October 30. On November 2. Genato decided to continue the Contract he had with them. Thus. Genato alleged that the agreement was only a simple receipt of an option-bid deposit. . and never stated that it was a partial payment. On the same day. 1989. the Da Jose spouses paid Genato the complete down payment of P950. On December 8. After having received the letter of Genato on November 4.in the day. reiterating that "our contract to sell your property had already been perfected. "6") enclosing a BPI Cashier's Check for P50.000. returned the said check to the former via RCPI telegram 14 dated November 6. the three (3) postdated checks have not been encashed. Ramon Genato advised Ricardo Cheng of his decision to continue his contract with the Da Jose spouses and the return of Cheng's P50.00 check. Consequently. the stipulated due date) in the total amount of P1. 1989. Cheng averred that the P50. Cheng's lawyer sent a letter 12 to Genato demanding compliance with their agreement to sell the property to him stating that the contract to sell between him and Genato was already perfected and threatening legal action.000. Cheng. 1990. However. consistent with the decision of Genato and the Da Jose spouses to continue with their Contract to Sell of September 6.865. 1989. In Answer 17 thereto. 1989.00 check he gave was a partial payment to the total agreed purchase price of the subject properties and considered as an earnest money for which Genato acceded. The agreement to continue with their contract was formalized in a conforme letter dated October 27. In his complaint. 1989. Thereafter. Cheng executed an affidavit of adverse claim 15 and had it annotated on the subject TCT's.00 and delivered to him three (3) postdated checks (all dated May 6. 1989.00 to cover full payment of the balance of the agreed purchase price. their contract was already perfected. 1989. nor is it an earnest money and that it was subject to condition that the prior contract with the Da Jose spouses be first cancelled.000. due to the filing of the pendency of this case." Meanwhile. also on November 2. Cheng instituted a complaint 16 for specific performance to compel Genato to execute a deed of sale to him of the subject properties plus damages and prayer for preliminary attachment.

Declaring the contract to sell dated September 6. Time was of the essence in the execution of the agreement between Genato and Cheng. 1989 another contract to sell pursuant to their mutual agreement with defendant. It cannot be true that the transaction was subjected to some condition or reservation. as vendees. 1989 and as the consequence of intervenors' failure to execute within seven (7) days from October 4. 1191.000.00. if it were otherwise. Ordering defendant to return to the intervenors the sum of P1. 1989 until full payment. like the priority in favor of the Da Jose spouses as first buyer because. especially as it was Genato himself who had made the receipt in his own hand. and intervenors Spouses Ernesto and Socorro Da Jose. extrajudicial or judicial.000. Civil Code. judgment is hereby rendered: 1. .The Da Jose spouses. under this circumstance demand. They alleged that the unilateral cancellation of the Contract to Sell was without effect and void. by virtue of defendant's affidavit to annul contract to sell dated October 13. the lower court also concluded that Cheng should be preferred over the intervenors-Da Jose spouses in the purchase of the subject properties. 1989 executed between defendant Ramon Genato. 1994 the trial court rendered its decision the decretal portion of which reads: WHEREFORE. plus interest at the legal rate from November 2. the lower court ruled that the receipt issued by Genato to Cheng unerringly meant a sale and not just a priority or an option to buy. It also opined that there was a valid rescission of the Contract to Sell by virtue of the Affidavit to Annul the Contract to Sell. They also cited Cheng's bad faith as a buyer being duly informed by Genato of the existing annotated Contract to Sell on the titles. is not necessary. on January 18. Thus. the receipt would have provided such material condition or reservation. Directing defendant to return to the intervenors the three (3) postdated checks immediately upon finality of this judgment. in their Answer in Intervention. resolved and rescinded in accordance with Art. 18 asserted that they have a superior right to the property as first buyers. Additionally. 3. as vendor. after reference was made to the substance of the agreement between Genato and the Da Jose spouses. After trial on the merits. The right of Genato to unilaterally rescind the contract is said to be under Article 1191 20 of the Civil Code. 2. It falls under the exception to the rule provided in Article 1169 19 of the Civil Code.

00.00. as and for attorney's fees. Meycauayan Branch. assails the Court of Appeals' Decision on the following grounds: (1) that the Da Jose spouses' Contract to Sell has been validly rescinded or resolved. embodied in the handwritten receipt. 4. herein respondents Ramon Genato and Da Jose spouses appealed to the court a quo which reversed such judgment and ruled that the prior contract to sell in favor of the Da Jose spouses was not validly rescinded. that the subsequent contract to sell between Genato and Cheng.197 (M) of the Registry of Deeds of Bulacan. Hence this petition. as nominal damages. at the rate of P70. xxx xxx xxx Not satisfied with the aforesaid decision. b/ P50. and that Cheng should pay damages to the respondents herein being found to be in bad faith. as nominal damages. d/ P20.00. as vendee.00 alreaddy paid to defendant. 21 This petition for review. T-76-196 (M) and T-76. (2) . which is considered as part of the purchase price. c/ P20. as and for attorney's fees. and 5 Ordering defendant to pay the plaintiff and the intervenors as follows: a/ P50.000. to plaintiff.000/square meter. to intervenors.000. Commanding defendant to execute with and in favor of the plaintiff Ricardo Cheng. 1989.000. less the amount of P50. to plaintiff. with the plaintiff being liable for payment of the capital gains taxes and other expenses of the transfer pursuant to the agreement to sell dated October 24. was without force and effect due to the failure to rescind the prior contract.000. to intervenors.000. a deed of conveyance and sale of the real properties described and covered in Transfer Certificates of Title No.00. and e/ Cost of the suit.

there can be no rescission of an obligation that is still non-existent. If this were not true. there being no stipulation authorizing him for automatic rescission. In a Contract to Sell. secondly. the failure of which is not a breach. the foregoing jurisprudence cannot be made to apply to the situation in the instant case because no default can be ascribed to the Da Jose spouses since the 30-day extension period has not yet expired. the payment of the purchase price is a positive suspensive condition. 22 It is one where the happening of the event gives rise to an obligation. In fact with this circumstance. to wit. Genato could have sent at least a notice of such fact. 1989 and not only on October 26. the obligor having failed to perform the suspensive condition which enforces a juridical relation. The petition must be denied for failure to show that the Court of Appeals committed a reversible error which would warrant a contrary ruling. in any case. 1989 should be upheld for the following reason. and (3) that. 1989 in connection with clause 3 of their contract to sell dated September 6. so as to finally clear the encumbrance on his titles and make it available to other would be buyers. No reversible error can be ascribed to the ruling of the Court of Appeals that there was no valid and effective rescission or resolution of the Da Jose spouses Contract to Sell. for its non-fulfillment there will be no contract to speak of." . Genato could have immediately annotated his affidavit to annul the contract to sell on his title when it was executed on October 13. 24 Obviously. It likewise settles the holding of the trial court that Genato "needed money urgently. firstly. it was error to hold him liable for damages. casual or serious. The Da Jose spouses' contention that no further condition was agreed when they were granted the 30-days extension period from October 7. the suspensive condition not having occurred as yet. Civil Code. contrary to petitioner's contentions and the trial court's erroneous ruling.that Ricardo Cheng's own contract with Genato was not just a contract to sell but one of conditional contract of sale which gave him better rights. thirdly. not a failure of a condition to render binding that obligation. thus precluding the application of the rule on double sales under Article 1544. 23 Emphasis should be made that the breach contemplated in Article 1191 of the New Civil Code is the obligor's failure to comply with an obligation already extant. Genato could not have been persuaded to continue his contract with them and later on agree to accept the full settlement of the purchase price knowing fully well that he himself imposed such sine qua non condition in order for the extension to be valid. 1989 after Cheng reminded him of the annotation. but a situation that prevents the obligation of the vendor to convey title from acquiring an obligatory force. Thus.

When a contract is subject to a suspensive condition. but it proceeds at its own risk. In many cases. and act accordingly. 27 even though we upheld the validity of a stipulation in a contract to sell authorizing automatic rescission for a violation of its terms and conditions. Otherwise. De Los Angeles. Thus. This rule validates. Ricardo Cheng's contention that the Contract to Sell between Genato and the Da Jose . the party who deems the contract violated may consider it resolved or rescinded. The act of a party in treating a contract as cancelled should be made known to the other. In University of the Philippines vs. as claimed by Genato. It is always subject to scrutiny and review by the courts in case the alleged defaulter brings the matter to the proper courts. 28 For such act is always provisional. Article 2203). to the Da Jose spouses for his decision to rescind their contract. the execution by Genato of the affidavit to annul the contract is not even called for. But the law definitely does not require that the contracting party who believes itself injured must first file suit and wait for a judgment before taking extrajudicial steps to protect its interest. litigations of this sort shall be prevented and the relations among would-be parties may be preserved. this being so Genato is not relieved from the giving of a notice. 29 this Court stressed and we quote: In other words. it being subjected to a suspensive condition. For with or without the aforesaid affidavit their non- payment to complete the full downpayment of the purchase price ipso facto avoids their contract to sell. For it is only the final judgment of the corresponding court that will conclusively and finally settle whether the action taken was or was not correct in law. the party injured by the other's breach will have to passively sit and watch its damages accumulate during the pendency of the suit until the final judgment of rescission is rendered when the law itself requires that he should exercise due diligence to minimize its own damages (Civil Code.Even assuming in gratia argumenti that the Da Jose spouses defaulted. contracts such as the one at bat. both in equity and justice. at least a written notice must be sent to the defaulter informing him of the same. 26 Nevertheless. its birth or effectivity can take place only if and when the event which constitutes the condition happens or is fulfilled. the parties would stand as if the conditional obligation had never existed. verbal or written. Resultantly. in their Contract to Sell. in order to avoid and prevent the defaulting party from assuming the offer as still in effect due to the obligee's tolerance for such non-fulfillment. without previous court action. 25 If the suspensive condition does not take place.

now pleads in this Petition. 36 To support his now new theory that the transaction was a conditional contract of sale. the factual milieu in Coronel is not on all fours with those in the case at bar. both courts below correctly held that the receipt which was the result of their agreement. . "D. But even if we are to assume that the receipt. 1989 was actually a perfected contract to sell. 35 In fact. And next. it did not acquire any obligatory force since it was subject to suspensive condition that the earlier contract to sell between Genato and the Da Jose spouses should first be cancelled or rescinded — a condition never met. redeemed himself by respecting and maintaining his earlier contract with the Da Jose spouses. This was. 31 Cheng alleged that the P50. petitioner invokes the case of Coronel vs. This ambivalent stance of Cheng is even noted by the appellate court. to his credit. 33 Settled is the rule that an issue which was not raised during the trial in the court below cannot be raised for the first time on appeal. Exh. When the requisites of a valid contract of sale are lacking in said receipt. this Court notes that plaintiff-appellee was inconsistent in characterizing the contract he allegedly entered into. Exh. Anent the issue on the nature of the agreement between Cheng and Genato. Court of Appeals 37 as the law that should govern their Petition. thus: At the outset.000. upon realizing his error. We do not agree. therefore the "sale" is neither valid or enfoceable. in a transparent turn- around.spouses was rescinded or resolved due to Genato's unilateral rescission finds no support in this case. as Genato. This patent twist only operates against Cheng's posture which is indicative of the weakness of his claim.00 down payment was earnest money. in fact Cheng's contention in his pleadings before said courts. In fact. "D. Apparently." alone would not even show that a conditional contract of sale has been entered by Genato and Cheng. is a contract to sell. In his complaint. 34 Issues of fact and arguments not adequately brought to the attention of the trial court need not be and ordinarily will not be considered by a reviewing court as they cannot be raised for the first time on appeal. his testimony 32 was offered to prove that the transaction between him and Genato on October 24. a careful reading of the receipt. the records of this case are replete with admissions 30 that Cheng believed it to be one of a Contract to Sell and not one of Conditional Contract of Sale which he." is to be treated as a conditional contract of sale.

to the person who presents he oldest title. This provision connotes that the following circumstances must concur: (a) The two (or more) sales transactions in issue must pertain to exactly the same subject matter. . the trial court and the appellate court correctly held that the agreement between Genato and Cheng is a contract to sell. petitioner connection in his pleadings before the said courts. and in the absence thereof. Exh. the delivery of the seller of the property and the manner of the transfer of title subject to the specific condition that upon the transfer in their names of the subject property the Coronels will execute the deed of absolute sale. if it should be movable property. To our mind.In Coronel. and must be valid sales transactions. (b) The two (or more) buyers at odds over the rightful ownership of the subject matter must each represent conflicting interests. 1544. a meticulous reading of the aforequoted provision shows that said law is not apropos to the instant case. which was. the purchase price. However. Should there be no inscription. the ownership shall be transferred to the person who may have first taken possession thereof in good faith. Whereas. Should it be immovable property. the ownership shall pertain to the person who in good faith was first in possession. which read: Art. The agreement of the parties therein was definitively outlined in the "Receipt of Down Payment" both as to property. both to mind. in fact. If the same thing should have been sold to different vendees. even by a careful perusal of the receipt. Consequently. in the instant case. the ownership shall belong to the person acquiring it who in good faith first recorded it in the Registry of Property. "D." alone such kind of circumstances cannot be ascertained without however resorting to the exceptions of the Rule on Parol Evidence. this Court found that the petitioners therein clearly intended to transfer title to the buyer which petitioner themselves admitted in their pleading. provided there is good faith. and (c) The two (or more) buyers at odds over the rightful ownership of the subject matter must each have bought from the very same seller.

means any entry made in the books of the registry. The contract to be binding upon the obligee or the vendor depends upon the fulfillment or non-fulfillment of an event. since such knowledge taints his prior registration with bad faith. among them. including both registration in its ordinary and strict sense. Jurisprudence 38 teaches us that the governing principle is PRIMUS TEMPORE. the knowledge gained by the Da Jose spouses. as first buyers. to register first their agreement as against the second buyer. annotation.These situations obviously are lacking in a contract to sell for neither a transfer of ownership nor a sales transaction has been consummated. it is the entry made in the registry which records solemnly and permanently the right of ownership and other . as defined by Soler and Castillo. 41 In its strict acceptation. and cancellation. registers or annotates his transaction or agreement on the title of the subject properties in good faith ahead of the Da Jose spouses. as second buyer. stronger in right). although the Da Jose spouses. This principle only applies when the special rules provided in the aforcited article of the Civil Code do not apply or fit the specific circumstances mandated under said law or by jurisprudence interpreting the article. 40 Thus. as first buyers. "Registration". 39 (2) the second buyer must show continuing good faith and innocence or lack of knowledge of the first sale until his contract ripens into full ownership through prior registration as provided by law. by delivery of possession. For not only was the contract between herein respondents first in time. PORTIOR JURE (first in time. knew of the second transaction it will not bar them from availing of their rights granted by law.e. Moreover. in ignorance of the first sale and of the first buyer's rights) from the time of acquisition until title is transferred to him by registration or failing registration. we are of the view that the governing principle of Article 1544. and even marginal notes. The rule exacted by Article 1544 of the Civil Code for the second buyer to be able to displace the first buyer are: (1) that the second buyer must show that he acted in good faith (i. In contrast. Notwithstanding this contrary finding with the appellate court. knowledge gained by Cheng of the first transaction between the Da Jose spouses and Genato defeats his rights even if he is first to register the second transaction. Civil Code. should apply in this situation. in the case at bar. of the new agreement between Cheng and Genato will not defeat their rights as first buyers except where Cheng. it was also registered long before petitioner's intrusion as a second buyer.

1989. .L." was issued to Cheng information of such pre-existing agreement has been brought to his knowledge which did not deter him from pursuing his agreement with Genato. Moreover. registration alone in such cases without good faith is not sufficient. of the rights of the Da Jose spouses under the Contract to Sell duly annotated on the transfer certificates of titles of Genato. . We give credence to the factual finding of the appellate court that "Cheng himself admitted that it was he who sought Genato in order to inquire about the property and offered to buy the same. Strong Machinery Co. Exh. the annotation made by the Da Jose spouses on the titles of Genato of their "Contract To Sell" more than satisfies this requirement. In this light. and then claim that he acted in good faith under the belief that there was no defect in the title of the vendor. or his willful closing of his eyes to the possibility of the existence of a defect in his vendor's title. A purchaser cannot close his eyes to facts which should put a reasonable man upon his guard. Whereas in the case of Genato's agreement with Cheng such is unavailing. it now becomes unnecessary to further elaborate in detail the fact that he is indeed in bad faith in entering into such agreement. So it is that "the honesty of intention. Good faith. is in its last analysis a question of intention. if it afterwards develops that the title was in fact defective.: 45 One who purchases real estate with knowledge of a defect . In the instant case. His mere refusal to believe that such defect exists. will not make him an innocent purchaser for value. or lack of it. . of title in his vendor cannot claim that he has acquired title thereto in good faith as against . or could have been if he had chosen to inquire. . F. and it appears that he had such notice of the defect as would have led to its discovery had he acted with that measure of precaution which may reasonably be required of a prudent man in a like situation. 44 And since Cheng was fully aware." "the . but in ascertaining the intention by which one is actuated on a given occasion. 42 We have ruled 43 before that when a Deed of Sale is inscribed in the registry of property on the original document itself. For even before the receipt.real rights. As we have held in Leung Yee vs. Good faith must concur with registration for such prior right to be enforceable. "D. and the same rule must be applied to one who has knowledge of facts which should have put him upon such inquiry and investigation as might be necessary to acquaint him with the defects in the title of his vendor. we see no reason why we should not give priority in right the annotation made by the Da Jose spouses with respect to their Contract to Sell dated September 6. we are necessarily controlled by the evidence as to the conduct and outward acts by which alone the inward motive may with safety. what was done with respect to said entries or annotations and marginal notes amounted to a registration of the sale. be determined. an interest therein. .

505. Breaux-Renoudet. 108 Cal.) (Emphasis ours) Damages were awarded by the appellate court on the basis of its finding that petitioner "was in bad faith when he filed the suit for specific performance knowing fully well that his agreement with Genato did not push through. Bromely. but rather a state or condition of mind which can only be judge of by actual or fancied tokens or signs." which constitutes good faith implies a "freedom from knowledge and circumstances which ought to put a person on inquiry. the instant petition for review is DENIED and the assailed decision is hereby AFFIRMED EN TOTO. "Good faith.. 46Such bad faith. tangible fact that can be seen or touched. 8. 2094-2098." and so it is that proof of such knowledge overcomes the presumption of good faith in which the courts always indulge in the absence of the proof to the contrary. Pinkerton Bros.. or the want of it. Cardenas vs. Cypress Lumber Co. 55 Vt. we find that the award of damages made by the appellate court is in order. Shadel. is not a visible. 119 Mich. Miller.. coupled with his wrongful interference with the contractual relations between Genato and the Da Jose spouses. Based on these overwhelming evidence of bad faith on the part of herein petitioner Ricardo Cheng. vs. SO ORDERED. honest lawful intent. 250." (Wilder vs. Ann. . which culminated in his filing of the present suit and thereby creating what the counsel for the respondents describes as "a prolonged and economically unhealthy gridlock 47 on both the land itself and the respondents' rights provides ample basis for the damages awarded. Co. Cf. WHEREFORE. Gilman. 17. 504. vs. 52 La. premises considered. 10.