CAPITOL SUBDIVISION, INC.
, plaintiff- Benares again mortgaged the Hacienda,
appellant,
vs.
PROVINCE OF NEGROS
OCCIDENTAL, defendant-appellee.
San Juan, Africa & Benedicto for plaintiff-
appellant.
Eduardo P. Arboleda and Jesus S. Rodriguez
for defendant-appellee.
CONCEPCION, J.:
Plaintiff, Capitol Subdivision, Inc., seeks to
recover from defendant, the Province of Negros
Occidental, the possession of Lot 378 of the
cadastral survey of Bacolod, Negros Occidental,
and a reasonable compensation for the use and
occupation of said lot by the defendant from
November 8, 1935, in addition to attorney's fees
and costs. On June 28, 1951, the Court of First
Instance of Negros Occidental rendered
judgment for the plaintiff. On appeal taken by the
defendant, this judgment was, however, set
aside by the Supreme Court (see G.R. No. L-
6204, decided on July 31, 1956), which,
likewise, ordered the case remanded to the
lower court "for further trial", 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. The case is, once
again, before us, this time on appeal by the
plaintiff, the subject matter of litigation being
worth more than P200,000, exclusive of interest
and costs.
The main facts are not in dispute. Said Lot 378
is part of Hacienda Mandalagan, consisting of
Lots 378, 405, 407, 410, 1205, 1452 and 1641
of the aforementioned cadastral survey, with an
aggregate area of over 502 hectares, originally
registered in the name of Agustin Amenabar and
Pilar Amenabar. Lot 378 has an area of 22,783
sq. meters, more or less, and was covered by
Original Certificate of Title No. 1776 (Exhibit 4),
issued on August 25, 1916, in the name of the
Amenabars. On November 30, 1920, the latter
sold the aforementioned hacienda to Jose
Benares (also referred to in some documents as
Jose Benares Montelibano) for the sum of
P300,000, payable installments, as set forth in
the deed of sale, Exhibit 21. On February 8,
1924, said Original Certificate of Title No. 1776
was cancelled and Jose Benares obtained, in
lieu thereof, Transfer Certificate of Title No.
6295 in his name. Meanwhile, or on March 12,
1921, the Hacienda, including Lot 378, had been
mortgaged by Jose Benares to the Bacolod-
Murcia Milling Co. for the sum of P27,991.74
(Exhibit Y-2). On December 6, 1926, Jose
including said Lot 378, on the Philippine National
Bank, subject to the first mortgage held by the
Bacolod-Murcia Milling Co. (Exhibit Y-1). These
transactions were duly recorded in the office of
the Register of Deeds of Negros Occidental and
annotated on the corresponding certificate of
title, including said Transfer Certificate of Title
No. 6295, covering Lot 378.
The mortgage in favor of the Bank was
subsequently foreclosed, in pursuance of a
decision of the Court of First Instance of Negros
Occidental dated September 29, 1931 (Exhibit
U-1), and the Bank acquired the Hacienda,
including Lot 378, as purchaser at the
foreclosure sale. Accordingly, said Transfer
Certificate of Title No. 6295 was cancelled and,
in its stead, transfer Certificate of Title No.
17166 0151 which, owing to its subsequent
loss, had to be reconstituted as Transfer
Certificate of Title No. RT-1371 in the name
of the Bank, was issued on March 14, 1934
(Exhibit P). Soon, later, or on November 8,
1935, the Bank agreed to sell the Hacienda to
Carlos P. Benares, son of Jose Banares, for the
sum of P400,000, payable in annual
installments, subject to the condition that, until
full payment thereof, title would remain in the
Bank (Exhibit R). Thereafter, Carlos P. Benares
transferred his rights, under this contract with
the Bank, to plaintiff herein, which completed the
payment of the installments due to the Bank in
1949. Hence, on September 29, 1949, the Bank
executed the corresponding deed of absolute
sale to the plaintiff (Exhibit Q) and Transfer
Certificate of Title No. 1798, covering 378 was
issued, in lieu of Transfer Certificate of Title No.
17166 (or reconstituted Transfer Certificate of
Title RT-1371), in plaintiff's name (Exhibit O).
Wherefore, the parties respectfully pray that the
foregoing stipulation of facts be admitted and
approved by this Honorable Court, without
prejudice to the parties adducing other evidence
to prove their case not covered by this
stipulation of facts. 1wph1.t
At this juncture, it should be noted that, despite
the acquisition of the Hacienda in 1934 by the
Bank, 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. For
this reason, the deed of promise to sell,
executed by the Bank in favor of Carlos P.
Benares, contained a caveat emptor stipulation.
When, upon the execution of the deed of
absolute sale (Exhibit Q) by the Bank, on
September 29, 1949, plaintiff took steps to take
possession the Hacienda, it was discovered that
Lot 378 was the land occupied by the Provincial
Hospital of Negros Occidental. Immediately,
thereafter, or on October 4, 1949, plaintiff made
representations with the proper officials to clarify
the status of said occupation and, not being
satisfied with the explanations given by said
officials, it brought the present action on June
10, 1950.
In its answer dated June 24, 1950, defendant
maintained that it had acquired Lot 378 in the
year; 1924-1925, through expropriation
proceedings; that immediately after the
commencement of said proceedings in 1924, it
took possession of said lot and began the
construction thereon of the provincial hospital,
which was completed in 1926; that since then it
had occupied said lot publicly, adversely,
notoriously and continuously as owner thereof;
that, "for some reason or other and for cause
beyond comprehension of the defendant title
thereto was never transferred in the name of
said defendant"; that said lot had been placed in
defendant's name for assessment purposes
under Tax Declaration No. 16269 (dated
December 31, 1937); and that plaintiff had acted
in bad faith in purchasing said lot from the Bank
in 1935, 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, aside from the
fact that Alfredo Montelibano, the controlling
stockholder, president and general manager of
plaintiff corporation, was the first City Mayor of
Bacolod which contributed to the support,
operation and maintenance of said hospital. In
an amended answer, dated November 8, 1950,
defendant alleged, also, that the aforementioned
expropriation case was "amicably settled as
between the parties herein, in the sense that the
... Province of Negros Occidental would pay ...
and did in fact pay to Jose Benares the
assessed value of Lot 378 ... 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 ... Jose Benares in favor of the
Province purposely for hospital site".
The main question for determination in this case
is whether or not defendant herein had acquired
Lot 378 in the aforementioned expropriation
proceedings. This decision appealed from in
effect decided this question in the affirmative
and declared that plaintiff merely holds it in trust
for the defendant, in view of which it ordered the
former to convey said lot to the latter. This
conclusion is predicated, substantially, upon the
following premises, namely that case No. 3041
of the Court of First Instance of Negros
Occidental for the expropriation of the hospital
site of said province, was actually commenced
on January 26, 1924; that, among the lands
sought to be expropriated in said case was Lot
377 of the aforementioned cadastral survey,
belonging to one Anacleta Agsam, who sold it,
on July 10, 1926, to the defendant (Exhibit BB),
in whose favor the corresponding transfer
certificate of title (Exhibit BB-2) was issued on
July 12, 1926; that, according the testimony of
Jose Benares, the expropriation of Lot 378 was
settled amicably upon payment to him of the
sum of P12,000; and that defendant's failure to
secure the corresponding transfer certificate of
title to Lot 378 was due to "the mistaken notion
or belief that said lot forms part of Lot No. 405-
B" in the plan (Exhibit X.).
The testimony of Jose Benares does not
deserve, however, full faith and credence,
because:
1. Jose Benares appears to be strongly
biased and prejudiced against the
plaintiff and its president, for the former
believes that the latter had
"manipulated" to exclude him from
plaintiff corporation, and there have
been four (4) litigations between Jose
Benares and plaintiff, all of which have
been finally decided against the former;
2. The testimony of Jose Benares is
extremely contradictory. Thus: (a) he
testified to having been paid P12,000 by
the Government, although, at the rate of
P1,000 a hectare at which, he would
have us believe, he agreed to sell Lot
378; he should have received less than
P3,000 for its 22,783 sq. meters; (b) he
claimed to have received said sum of
P12,000.00 "in the year 1924 or 1925",
about "2 or 3 days" after the
Government had taken possession of
the land, and to have sent the money
next day to Pilar Amenabar, but the
latter acknowledged to have received
the said sum of P12,000 on November
7, 1928;
3. Said testimony was contradicted by
that of defendant's witness Jose Marco,
former deputy clerk of court of Negros
Occidental, for: (a) Jose Benares
asserted that there was a written
compromise agreement between him
and the Government, whereas Marco
averred that agreement was merely oral;
and (b) Marco stated that Benares had
agreed to accept, as compensation for
Lot 378, the assessed value thereof,
which was P430, and to donate to the
Government the difference between this
sum and the true value of the property,
 but Benares affirmed that he was first
offered P300 per hectare, which he
rejected, and that he later demanded
P1,000 a hectare, which the
Government agreed to pay, although,
subsequently, he said that Rafael
Alunan and Mariano Yulo had prevailed
upon him to accept P1,000 per hectare;
4. Jose Benares was, also, contradicted
by defendant's witness Ildefonso
Coscolluela, the provincial treasurer of
Negros Occidental at the time of the
expropriation, 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.
Upon the other hand, 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. For instance:
1. 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);.
2. The registration of the deed of sale of
Lot 377 by Anacleta Agsam to the
Government, followed by the
cancellation of the certificate of title in
her name and the issuance, in lieu
thereof, of another title in the name of
the Province, 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,
strongly suggest that no such
assignment or agreement with respect
to Lot 378 had been made or reached;.
3. The property was mortgaged to the
Bacolod-Murcia Milling Co. since March
12, 1921, and this mortgage, duly
registered and annotated, inter alia, on
Transfer Certificate of Title No. 1776, in
the name of Jose Benares, was not
cancelled until September 28, 1935.
Moreover, Lot 378 could not have been
expropriated without the intervention of
the Milling Co. Yet, the latter was not
made a party in the expropriation
proceedings;
4. On December 26, 1926, Jose
Benares constituted second mortgage in
favor of the Bank, which would not have
accepted the mortgage had Lot 378 not
belonged then to the mortgagor. Neither
could said lot have been expropriated
subsequently thereto without the Bank's
knowledge and participation. What is
more, in the deed executed by the Bank,
on November 8, 1935 (Exhibit R),
promising to sell the Hacienda
Mandalagan to Carlos Benares, it was
explicitly stated that portions of Lots
405, 407 and 410, forming part of said
Hacienda and designated as Lots 405-
A, 407-A; 407-B and 410-A, had been
expropriated by the Provincial
Government of Negros Occidental, thus
indicating, by necessary implication, that
Lot 378 had not been expropriated.
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. 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. The
Court believes that the failure of the
government to secure the corresponding
transfer of title to Lot 378 lies in the
mistaken notion or belief that said lot
forms a part of Lot 405-B. This
conclusion was arrived at after
examining closely the plan, Exhibit X.
The plan shows that while all the
subdivided lots were properly identified
by lot numbers, that particular portion at
the lower corner of the plan encircled
with red pencil, marked Exhibit X-1, is
not labelled with the corresponding lot
number and that portion is precisely lot
No. 378, now in question, where the
hospital building was constructed. This
plan was prepared for the government
on May 12, 1927 by public land
surveyor, Mr. Formento, embracing lots
covering over 22 hectares for the
Capitol and hospital sites. 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, which
adjoins it, although separated by the
creek. This lack of reasonable
explanation why the government failed
to secure the corresponding certificate
of title to lot 378, when there is sufficient
proof that Jose Benares was paid and
 he executed the deed of sale in favor of
the government.
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, we find ourselves unable to concur in
the foregoing view. To begin with, there is no
evidence, and defendant has not even tried to
prove, that the expropriation case had ever been
dismissed insofar as Lot 378 is concerned.
Hence, the lower court merely speculated about
the "chances that the (expropriation) case was
dismissed." By the way, the contrary was
intimated by defendant's witness, Ildefonso
Coscolluela, for he testified that the
expropriation case was still pending in 1934,
when he ceased to be the provincial treasurer,
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, there were no further
proceedings in said case..
With respect to the plan, Exhibit X, there is,
likewise, no evidence whatsoever that the
authorities had been "misled ... to believe" that
the portion at the lower corner of said plan
which was enclosed, during the trial, within a
circle in red pencil, and marked as Exhibit X-1
formed part of Lot 405-B, which had been
expropriated by the Province of Negros
Occidental. In fact, said portion, Exhibit X-1,
is not part of the land covered by the plan
Exhibit X. A close examination of the latter
shows that the boundaries of said portion are
not delimited on the plan. More important still, on
the right hand side of Exhibit X, the following
appears in bold letters: "Subdivision &
Consolidation PLAN of Lots Nos. 400, 401,
403,405, 406, 407 and 410 Bacolod Cadastre as
surveyed for the Provincial Government of
Bacolod, Negros Occidental (Capitol site)". 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", negates the
possibility of its being mistaken by any body,
much less by government engineers, as
including the hospital site, and, hence, said Lot
378. Lastly, the very evidence for the defendant
herein, specially the assessor's field sheets and
declarations of real property for tax purposes
(Exhibits 9, 10, 11, 12 and 13) show that the
Government had always regarded Lot 378, not
Lot 405, as part of the Provincial Hospital Site.
In any event, said possibility of mistake, if any,
which would be remote, 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.
How about the P12,000 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, for, at the rate of P1,000 a
hectare allegedly agreed therefor, its price could
not have exceeded P3,000.00. In this
connection, it should be noted that, aside from
the expropriation proceedings for the hospital
site, another expropriation case for the Capitol
site, affecting another property of Jose Benares,
appears to have been instituted in the Court of
First Instance of Negros Occidental. Jose
Benares may have mistaken the payment for his
land included in the Capitol site, as one intended
for Lot 378, which was affected by the hospital
site. And this possibility may amount to a
probability when we consider that he
erroneously believed that there had been
only one expropriation case, instead of two
cases, against him, and that Lot 378, was not
included in the mortgage constituted by him in
favor of the Philippine National Bank. Evidently,
he did not have, at least, an accurate
recollection of the events or transactions
affecting his properties, and, hence, his
testimony may not be relied upon.
Thus, the evidence on record is far from
sufficient to establish the alleged acquisition by
the defendant of Lot 378, which must be held,
therefore, to be the exclusive property of plaintiff
herein.
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. Yet, 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", 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"; 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"; because "it took the plaintiff
14 years to sleep over the supposed rights to
take possession of lot No. 378"; and because "of
the overwhelming fact that lot No. 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, as owner thereof".
As above stated, however, and the lower court herein is a purchaser in good faith and for
conceded, plaintiff's president did not know until value..
1949 that lot 378 was the very land occupied by
the provincial hospital. Moreover, there is a total As regards the compensation that, as such, it
absence of evidence that this fact was known to may collect from the defendant, we are of the
Carlos P. Benares before 1949. Neither may opinion, and so hold, that, since the latter's right
such knowledge be deduced from the to expropriate Lot 378 is not contested, and is
circumstances that he is a son of its former seemingly conceded, the plaintiff may demand
owner, Jose Benares, for even the latter what is due by reason of the expropriation of
appears not to be well-posted on the status of said lot. In short, plaintiff is entitled to recover
his properties. Indeed, Jose Benares did not from the defendant the fair and full equivalent to
apparently know that there were two (2) Lot 378, as of the time when possession thereof
expropriation proceedings effecting said was actually taken by the defendant, plus
properties: that the P12,000 received by him consequential damages including attorney's
from the Government was not meant for Lot 378; fees from which consequential damages the
and that this lot was one of the properties consequential benefits, if any, should be
mortgaged by him to the Bank. deducted, with interests, at the legal rate, on the
aggregate sum due to the plaintiff, from and
"Upon the other hand, the main purpose of the after the date of said actual taking. The case
Torrens System is to avoid possible conflicts of should be remanded, therefore, to the lower
title in and to real estate, and to facilitate court for the reception of evidence on the date of
transactions relative thereto giving the public the said actual taking and the amount of
right to rely upon the face of Torrens certificate compensation collectible from the defendant,
of title and to dispense with the of inquiring and the rendition, thereafter, of the
further, except when the party concerned has corresponding decision thereon..
actual knowledge of facts and circumstances
that should impel a reasonably cautious man to WHEREFORE, the decision appealed from is
make such further inquiry (Tiburcio vs. PHHC, L- hereby reversed and the records remanded to
13479, October 31, 1959; Revilla vs. Galindez, the lower court for further proceedings, as above
G.R. No. L-19940, March 30, 1960; Manacop, stated, with costs against the defendant. It is so
Jr. vs. Cansino, G.R. No. L-13791, February 27, ordered..
1961). In the case at bar plaintiff had no such
actual knowledge, it being an established fact
that he was not aware until 1949 that the land on
which the provincial hospital stood was Lot 378.
Furthermore, since the year 1921, or before the
expropriation case for the hospital site had
begun, said lot was mortgaged to the Bacolod-
Murcia Milling Co., and the mortgage, duly
registered, as well as annotated on the
corresponding certificate of title, was not
cancelled until September 28, 1935. Prior to this
date, or on December 26, 1926, Lot 378 was
subjected to a second mortgage in favor of the
Bank, which acquired title thereto, thru
foreclosure proceedings, in 1934. When the
Bank agreed on November 8, 1935, to sell the
property to Carlos P. Benares and the latter,
subsequently conveyed his rights to plaintiff
herein, as well as when the bank executed the
deed of absolute sale in plaintiff's favor on
September 20, 1949, the title to the property
was in the name of the Bank. Considering that
sugar centrals as well as banks are known to
have an array of experienced and competent
lawyers, 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, and to the Bank when said deed of
sale was executed. In short, we find that plaintiff
RICARDO CHENG, petitioner, vs. RAMON B.
GENATO and ERNESTO R. DA JOSE
& SOCORRO B. DA
JOSE, respondents.
DECISION
MARTINEZ, J.:
This petition for review on certiorari seeks to
annul and set aside the Decision of the Court of
Appeals (CA)[1] dated July 7, 1997 in CA-G.R. No.
CV No. 44706 entitled Ricardo Cheng, plaintiff-
appellee vs. Ramon B. Genato, defendant -
appellant, Ernesto R. Da Jose & Socorro B. Da
Jose, Intervenors-Appellants which reversed the
ruling of the Regional Trial Court, Branch 96 of
Quezon City dated January 18, 1994.The
dispositive portion of the CA Decision reads:
WHEREFORE, based on the foregoing,
appealed decision is hereby REVERSED and
SET ASIDE and judgment is rendered ordering;
1. The dismissal of the complaint;
2. The cancellation of the annotations of the
defendant-appellants Affidavit to Annul Contract
to Sell and plaintiff-appellees Notice of Adverse
Claim in the subject TCTs, namely, TCT No. T-
76.196 (M) and TCT No. T-76.197 (M);
3. 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.
4. Ordering the execution by the defendant-
appellant Genato of the Deed of Absolute Sale
over the subject two lots covered by TCT No. T-
76.196 (M) and TCT No. T-76.197 (M) in favor of
intervenors-appellants Spouses Da Jose;
5. The return by defendant-appellant Genato
of P50,000.00 paid to him by the plaintiff-
appellee Cheng, and
6. Payment by plaintiff-appellee Cheng of moral
damages to herein intervenors-appellants Da
Jose of P100,000.00, exemplary damages
of P50,000.00, attorneys fees of P50,000.00,
and costs of suit; and to defendant-appellant,
of P100,000.00 in exemplary
damages, P50,000.00 in attorneys fees. 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.
SO ORDERED. [2]
The antecedents of the case are as follows:
Respondent Ramon B. Genato(Genato) is
the owner of two parcels of land located at
Paradise Farms, San Jose Del Monte, Bulacan
covered by TCT No. T-76.196 (M)[3] and TCT No.
T-76.197 (M)[4] with an aggregate area of 35,821
square meters, more or less.
On September 6, 1989, respondent Genato
entered into an agreement with respondent -
spouses Ernesto R. Da Jose and Socorro B. Da
Jose (Da Jose spouses) over the above-
mentioned two parcels of land. The agreement
culminated in the execution of a contract to sell
for which the purchase price was P80.00 per
square meter. The contract was in a public
instrument and was duly annotated at the back of
the two certificates of title on the same
day. Clauses 1 and 3 thereof provide:
'1. That the purchase price shall be EIGHTY
(P80.00) PESOS, Philippine Currency per
square meter, of which the amount of FIFTY
THOUSAND (P50,000.00) Pesos shall be paid
by the VENDEE to the VENDOR as partial down
payment at the time of execution of this Contract
to Sell.
xxx xxx xxx
'3. That the VENDEE, thirty (30) DAYS after the
execution of this contract, and only after having
satisfactorily verified and confirmed the truth and
authenticity of documents, and that no
restrictions, limitations, and developments
imposed on and/or affecting the property subject
of this contract shall be detrimental to his
interest, the VENDEE shall pay to the VENDOR,
NINE HUNDRED FIFTY THOUSAND
(P950,000.00) PESOS, Philippine Currency,
representing the full payment of the agreed
Down Payment, after which complete
possession of the property shall be given to the
VENDEE to enable him to prepare the premises
and any development therein. [5]
On October 4, 1989, the Da Jose spouses,
not having finished verifying the titles mentioned
in clause 3 as aforequoted, asked for and was
granted by respondent Genato an extension of
another 30 days or until November 5,
1989. However, according to Genato, the
extension was granted on condition that a new
set of documents is made seven (7) days from
October 4, 1989. [6] This was denied by the Da
Jose spouses.
Pending the effectivity of the aforesaid
extension period, and without due notice to the
Da Jose spouses, Genato executed an Affidavit
to Annul the Contract to Sell, [7] on October 13,
1989. Moreover, no annotation of the said
affidavit at the back of his titles was made right
away.The affidavit contained, inter alia, the
following paragraphs;
xxx xxx xxx
That it was agreed between the parties that the
agreed downpayment of P950,000.00 shall be
paid thirty (30) days after the execution of the
Contract, that is on or before October 6, 1989;
The supposed VENDEES failed to pay the said
full downpayment even up to this writing, a
breach of contract.
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; [8]
On October 24, 1989, herein petitioner
Ricardo Cheng (Cheng) went to Genatos
residence and expressed interest in buying the
subject properties. On that occasion, Genat o
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. Genato also showed him the
aforementioned Affidavit to Annul the Contract to
Sell which has not been annotated at the back of
the titles.
Despite these, Cheng went ahead and
issued a check for P50,000.00 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.
D), written in this wise.
10/24/89
Received from Ricardo Cheng
the Sum of Fifty Thousand Only
(P50,000 -)
as partial for T-76196 (M)
T-76197 (M) area
35,821 Sq.m.
Paradise Farm, Gaya-Gaya, San Jose
Del Monte
P70/m2 Bulacan
Plus C.G.T. etc
(SGD) Ramon B. Genato
Check # 470393
10/24/89[9]
On October 25, 1989, Genato deposited
Chengs check. On the same day, Cheng called
up Genato reminding him to register the affidavit
to annul the contract to sell. [10]
The following day, or on October 26, 1989,
acting on Chengs request, Genato caused the
registration of the Affidavit to Annul the Contract
to Sell in the Registry of Deeds, Meycauayan,
Bulacan as primary entry No. 262702. [11]
While the Da Jose spouses were at the
Office of the Registry of Deeds of Meycauaya,
Bulacan on October 27, 1989, they met Genat o
by coincidence. It was only then that the Da Jose
spouses discovered about the affidavit to annul
their contract. The latter were shocked at the
disclosure and protested against the rescission of
their contract. After being reminded that he
(Genato) had given them (Da Jose spouses) an
additional 30-day period to finish their verificat ion
of his titles, that the period was still in effect, and
that they were willing and able to pay the balanc e
of the agreed down payment, later on in the day,
Genato decided to continue the Contract he had
with them. The agreement to continue with their
contract was formalized in a conforme letter
dated October 27, 1989.
Thereafter, Ramon Genato advised Ricardo
Cheng of his decision to continue his contract
with the Da Jose spouses and the return of
Chengs P50,000.00 check. Consequently, on
October 30, 1989, Chengs 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 Genat o
was already perfected and threatening legal
action.
On November 2, 1989, Genato sent a
letter[13] to Cheng (Exh. 6) enclosing a BPI
Cashiers Check for P50,000.00 and expressed
regret for his inability to consummate his
transaction with him. After having received the
letter of Genato on November 4, 1989, Cheng,
however, returned the said check to the former
via RCPI telegram [14] dated November 6, 1989,
reiterating that our contract to sell your propert y
had already been perfected.
Meanwhile, also on November 2, 1989,
Cheng executed an affidavit of advers e
claim[15] and had it annotated on the subject
TCTs.
On the same day, consistent with the
decision of Genato and the Da Jose spouses to
continue with their Contract to Sell of September
6, 1989, the Da Jose spouses paid Genato the
complete down payment of P950,000.00 and
delivered to him three (3) postdated checks (all
dated May 6, 1990, the stipulated due date) in the
total amount of P1,865,680.00 to cover full
payment of the balance of the agreed purchas e
price.However, due to the filing of the pendenc y
of this case, the three (3) postdated checks have
not been encashed.
On December 8, 1989, 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. In his complaint, Cheng
averred that the P50,000.00 check he gave was
a partial payment to the total agreed purchas e
price of the subject properties and considered as
an earnest money for which Genat o
acceded. Thus, their contract was already
perfected.
In Answer[17] thereto, Genato alleged that
the agreement was only a simple receipt of an
option-bid deposit, and never stated that it was a
partial payment, nor is it an earnest money and
that it was subject to the condition that the prior
contract with the Da Jose spouses be first
cancelled.
The Da Jose spouses, in their Answer in
Intervention, [18] asserted that they have a superior
right to the property as first buyers. They alleged
that the unilateral cancellation of the Contract to
Sell was without effect and void. They also cited
Chengs bad faith as a buyer being duly informed
by Genato of the existing annotated Contract to
Sell on the titles.
After trial on the merits, 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 cannot be true that the
transaction was subjected to some condition or
reservation, like the priority in favor of the Da
Jose spouses as first buyer because, if it were
otherwise, the receipt would have provided such
material condition or reservation, especially as it
was Genato himself who had made the receipt in
his own hand. 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. Time was
of the essence in the execution of the agreement
between Genato and Cheng, under this
circumstance demand, extrajudicial or judicial, is
not necessary. It falls under the exception to the
rule provided in Article 1169[19] of the Civil
Code. The right of Genato to unilaterally rescind
the contract is said to be under Article 1191 [20] of
the Civil Code. Additionally, after reference was
made to the substance of the agreement between
Genato and the Da Jose spouses, the lower court
also concluded that Cheng should be preferred
over the intervenors-Da Jose spouses in the
purchase of the subject properties. Thus, on
January 18, 1994 the trial court rendered its
decision the decretal portion of which reads:
WHEREFORE, judgment is hereby rendered:
1. Declaring the contract to sell dated
September 6, 1989 executed between
defendant Ramon Genato, as vendor, and
intervenors Spouses Ernesto and Socorro Da
Jose, as vendees, resolved and rescinded in
accordance with Art. 1191, Civil Code, by virtue
of defendants affidavit to annul contract to sell
dated October 13, 1989 and as the
consequence of intervenors failure to execute
within seven (7) days from October 4, 1989
another contract to sell pursuant to their mutual
agreement with the defendant;
2. Ordering defendant to return to the
intervenors the sum of P1,000,000.00, plus
interest at the legal rate from November 2, 1989
until full payment;
3. Directing defendant to return to the
intervenors the three (3) postdated checks
immediately upon finality of this judgment;
4. Commanding defendant to execute with and
in favor of the plaintiff Ricardo Cheng, as
vendee, a deed of conveyance and sale of the
real properties described and covered in
Transfer Certificates of Title No. T-76-196 (M)
and T-76.197 (M) of the Registry of Deeds of
Bulacan, Meycauyan Branch, at the rate
of P70.00/sqaure meter, less the amount
of P50,000.00 already paid to defendant, which
is considered as part of the purchase price, 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, 1989; and
5. Ordering defendant to pay the plaintiff and the
intervenors as follows:
a/ P50,000.00, as nominal damages, to plaintiff;
b/ P50,000.00, as nominal damages, to
intervenors;
c/ P20,000.00, as and for attorneys fees, to
plaintiff;
d/ P20,000.00, as and for attorneys fees, to
intervenors; and
e/ Cost of the suit.
xxx xxx xxx
Not satisfied with the aforesaid decision,
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,
embodied in the handwritten receipt, was without
force and effect due to the failure to rescind the
prior contract; and that Cheng should pay
damages to the respondents herein being found
to be in bad faith.
Hence this petition. [21]
This petition for review, 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; (2) that
Ricardo Chengs own contract with Genato was
not just a contract to sell but one of conditional
contract of sale which gave him better rights, thus
precluding the application of the rule on double
sales under Article 1544, Civil Code; and (3) that,
in any case, it was error to hold him liable for
damages.
The petition must be denied for failure to
show that the Court of Appeals committed a
reversible error which would warrant a contrary
ruling.
No reversible error can be ascribed to the
ruling of the Court of Appeals that there was no
valid and effective rescission of resolution of the
Da Jose spouses Contract to Sell, contrary to
petitioners contentions and the trial courts
erroneous ruling.
In a Contract to Sell, the payment of the
purchase price is a positive suspensive condition,
the failure of which is not a breach, casual or
serious, but a situation that prevents the
obligation of the vendor to convey title from
acquiring an obligatory force. [22] It is one where
the happening of the event gives rise to an
obligation. Thus, for its non-fulfillment there will
be no contract to speak of, the obligor having
failed to perform the suspensive condition which
enforces a juridical relation. In fact with this
circumstance, there can be no rescission of an
obligation that is still non-existent, the suspensive
condition not having occurred as
yet. [23] Emphasis should be made that the breac h
contemplated in Article 1191 of the New Civil
Code is the obligors failure to comply with an
obligation already extant, not a failure of a
condition to render binding that obligation. [24]
Obviously, the foregoing jurisprudenc e
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 Da
Jose spouses contention that no further condition
was agreed when they were granted the 30-days
extension period from October 7, 1989 in
connection with clause 3 of their contract to sell
dated September 6, 1989 should be upheld for
the following reason, to wit; firstly, If this were not
true, 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; secondly, Genato could
have immediately annotated his affidavit to annul
the contract to sell on his title when it was
executed on October 13, 1989 and not only on
October 26, 1989 after Cheng reminded him of
the annotation; thirdly, Genato could have sent at
least a notice of such fact, there being no
stipulation authorizing him for automatic
rescission, so as to finally clear the encumbranc e
of his titles and make it available to other would
be buyers. It likewise settles the holding of the
trial court that Genato needed money urgently.
Even assuming in gratia argumenti that the
Da Jose spouses defaulted, as claimed by
Genato, in their Contract to Sell, the execution by
Genato of the affidavit to annul the contract is not
even called for. 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, it being
subjected to a suspensive condition. When a
contract is subject to a suspensive condition, its
birth or effectivity can take place only if and when
the event which constitutes the condition
happens or is fulfilled. [25] If the suspensive
condition does not take place, the parties would
stand as if the conditional obligation had never
existed. [26]
Nevertheless, this being so Genato is not
relieved from the giving of a notice, verbal or
written, to the Da Jose spouses for decision to
rescind their contract. In many cases, [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, at least
a written notice must be sent to the default er
informing him of the same. The act of a party in
treating a contract as cancelled should be made
known to the other. [28] For such act is always
provisional. It is always subject to scrutiny and
review by the courts in case the alleged default er
brings the matter to the proper
courts. In University of the Philippines vs. De
Los Angeles,[29] this Court stressed and we
quote:
In other words, the party who deems the
contract violated may consider it resolved or
rescinded, and act accordingly, without previous
court action, but it proceeds at its own risk . 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. 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 extajudicial steps to protect its
interest. Otherwise, the party injured by the
others 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, Article
2203).
This rule validates, both in equity and justice,
contracts such as the one at bat, in order to avoid
and prevent the defaulting party from assuming
the offer as still in effect due to the obligees
tolerance for such non-fulfillment. Resultantly,
litigations of this sort shall be prevented and the
relations among would-be parties may be
preserved. Thus, Ricardo Chengs contention that
the Contract to Sell between Genato and the Da
Jose spouses was rescinded or resolved due to
Genatos unilateral rescission finds no support in
this case.
Anent the issue on the nature of the
agreement between Cheng and Genato, 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 Conditionl
Contract of Sale which he, in a transparent turn-
around, now pleads in this Petition. This
ambivalent stance of Cheng is even noted by the
appellate court, thus:
At the outset, this Court notes that plaintiff-
appellee was inconsistent in characterizing the
contract he allegedly entered into. In his
complaint, [31] Cheng alleged that the P50,000.00
down payment was earnest money. And next,
his testimony [32] was offered to prove that the
transaction between him and Genato on October
24, 1989 was actually a perfected contract to
sell. [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. [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. [35] In fact,
both courts below correctly held that the receipt
which was the result of their agreement, is a
contract to sell. This was, in fact Chengs
contention in his pleadings before said
courts. This patent twist only operates against
Chengs posture which is indicative of the
weakness of his claim.
But even if we are to assume that the
receipt, Exh. D, is to be treated as a conditional
contract of sale, it did not acquire any obligatory
force since it was subject to suspensive condition
that the earlier contract to sell between Genat o
and the Da Jose spouses should first be
cancelled or rescinded a condition never met, as
Genato, to his credit, upon realizing his error,
redeemed himself by respecting and maintaining
his earlier contract with the Da Jose spouses. In
fact a careful reading of the receipt, Exh. D, alone
would not even show that a conditional contract
of sale has been entered by Genato and
Cheng. When the requisites of a valid contract of
sale are lacking in said receipt, therefore the sale
is neither valid or enforceable. [36]
To support his now new theory that the
transaction was a conditional contract of sale,
petitioner invokes the case of Coronel vs. Court
of Appeals[37] as the law that should govern their
Petition. We do not agree. Apparently, the factual
milieu in Coronel is not on all fours with those in
the case at bar.
In Coronel, this Court found that the
petitioners therein clearly intended to transfer title
to the buyer which petitioner themselves admitted
in their pleading. The agreement of the parties
therein was definitively outline in the Receipt of
Down Payment both as to property, the purchas e
price, 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.
Whereas, in the instant case, even by a
careful perusal of the receipt, Exh. D, alone such
kind of circumstances cannot be ascertained
without however resorting to the exceptions of the
Rule on Parol Evidence.
To our mind, the trial court and the appellat e
court correctly held that the agreement between
Genato and Cheng is a contract to sell, which
was, in fact, petitioner connection in his pleadings
before the said courts. Consequently, both to
mind, which read:
Article 1544. If the same thing should have
been sold to different vendees, the ownership
shall be transferred to the person who may have
first taken possession thereof in good faith, if it
should be movable property.
Should it be immovable property, the ownership
shall belong to the person acquiring it who in
good faith first recorded it in the Registry of
Property.
Should there be no inscription, the ownership
shall pertain to the person who in good faith was
first in possession; and in the absence thereof,
to the person who presents the oldest title,
provided there is good faith
However, a meticulous reading of the
aforequoted provision shows that said law is not
apropos to the instant case. This provision
connotes that the following circumstances must
concur:
(a) The two (or more) sales transactions in the
issue must pertain to exactly the same subject
matter, 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; 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.
These situations obviously are lacking in a
contract to sell for neither a transfer of ownership
nor a sales transaction has been
consummated. The contract to be binding upon
the obligee or the vendor depends upon the
fulfillment or non-fulfillment of an event.
Notwithstanding this contrary finding with
the appellate court, we are of the view that
the governing principle of Article 1544, Civil
Code, should apply in this
situation. Jurisprudence[38] teaches us that the
governing principle is PRIMUS TEMPORE ,
PORTIOR JURE (first in time, stronger in
right). For not only was the contract between
herein respondents first in time; it was also
registered long before petitioners intrusion as a
second buyer. This principle only applies when
the special rules provided in the aforcited article
of Civil Code do not apply or fit the specific
circumstances mandated under said law or by
jurisprudence interpreting the article.
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.e. in ignorance of the first
sale and of the first buyers rights) from the time
of acquisition until title is transferred to him by
registration or failing registration, by delivery of
possession; [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. [40]
Thus, in the case at bar, the knowledge
gained by the Da Jose spouses, as first buyers,
of the new agreement between Cheng and
Genato will not defeat their rights as first buyers
except where Cheng, as second buyer, registers
or annotates his transaction or agreement on the
title of the subject properties in good faith ahead
of the Da Jose spouses. Moreover, although the
Da Jose spouses, as first buyers, knew of the
second transaction it will not bar them from
availing of their rights granted by law, among
them, to register first their agreement as against
the second buyer.
In contrast, 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, since
such knowledge taints his prior registration with
bad faith.
Registration, as defined by Soler and
Castillo, means any entry made in the books of
the registry, including both registration in its
ordinary and strict sense and
cancellation, annotation, and even marginal
notes. [41] In its strict acceptation, it is the entry
made in the registry which records solemnly and
permanently the right of ownership and other real
rights. [42] We have ruled[43] before that when a
Deed of Sale is inscribed in the registry of
property on the original document itself, what was
done with respect to said entries or annotations
and marginal notes amounted to a registration of
the sale. In this light, 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, 1989.
Moreover, registration alone in such cases
without good faith is not sufficient. Good faith
must concur with registration for such prior right
to be enforceable. In the instant case, the
annotation made by the Da Jose spouses on the
titles of Genato of their Contract to Sell more than
satisfies this requirement. Whereas in the case of
Genatos agreement with Cheng such is
unavailing. For even before the receipt, Exh. D,
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. 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. [44] And since Cheng was
fully aware, or could have been if he had chosen
to inquire, of the rights of the Da Jose spouses
under the Contract to Sell duly annotated on the
transfer certificates of titles of Genato, it now
becomes unnecessary to further elaborate in
detail the fact that he is indeed in bad faith in
entering into such agreement. As we have held gridlock [47] on both the land itself and the
in Leung Yee vs. F.L. Strong Machinery Co.: [45] respondents rights provides ample basis for the
damages awarded. Based on these
One who purchases real estate with k nowledge overwhelming evidence of bad faith on the part of
of a defect x x x of title in his vendor cannot herein petitioner Ricardo Cheng, we find that the
claim that he has acquired title thereto in good award of damages made by the appellate court is
faith as against x x x x an interest therein; and in order.
the same rule must be applied to one who has WHEREFORE, premises considered, the
k nowledge of facts which should have put him instant petition for review is DENIED and the
upon such inquiry and investigation as might be
assailed decision is hereby
necessary to acquaint him with the defects in the AFFIRMED ENTOTO.
title of his vendor. A purchaser cannot close his
eyes to facts which should put a reasonable SO ORDERED.
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. His mere
refusal to believe that such defect exists, or his
willful closing of his eyes to the possibility of the
existence of a defect in his vendors title, will not
make him an innocent purchaser for value, if it
afterwards develops that the title was in fact
defective, 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. Good faith, or lack of it, is
in its last analysis a question of intention; but in
ascertaining the intention by which one is
actuated on a given occasion, we are
necessarily controlled by the evidence as to the
conduct and outward acts by which alone the
inward motive may, with safety, be
determined. So it is that the honesty of intention,
the honest lawful intent, which constitutes good
faith implies a freedom from k nowledge and
circumstances which ought to put a person on
inquiry, 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. Good faith, or the
want of it, is not a visible, tangible fact that can
be seen or touched, but rather a state or
condition of mind which can only be judge of by
actual or fancied tokens or signs. (Wilder vs.
Gilman, 55 Vt. 504, 505; Cf. Cardenas vs. Miller,
108 Cal., 250; Breaux-Renoudet, Cypress
Lumber Co. vs. Shadel, 52 La. Ann., 2094-2098;
Pinkerton Bros. Co. vs. Bromely, 119 Mich., 8,
10, 17.) Emphasis ours

Damages were awarded by the appellat e

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. [46] Such bad faith, coupled with his
wrongful interference with the contractual
relations between Genato and the Da Jose
spouses, 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
REPUBLIC OF THE PHILIPPINES, Petitioner, 1
vs.
BENJAMIN GUERRERO, Respondent.
DECISION
GARCIA, J.:
Assailed and sought to be set aside in this
petition for review under Rule 45 of the Rules of
Court is the decision2dated February 12, 1998 of
the Court of Appeals (CA) in CA-G.R. CV No.
50298 affirming an earlier decision of the
Regional Trial Court (RTC) of Quezon City in
Civil Case No. 89-3899, entitled "Petition for
Amendment of Plan and Technical Description
of Original Certificate of Title No. 0-28 in the
name of Benjamin Guerrero, Registry of Deeds
of Quezon City."
The assailed decision of the CA recites the facts
as follows:
Sometime in December 1964, respondent
Benjamin Guerrero filed with the Bureau of
Lands (now Lands Management Bureau) a
Miscellaneous Sales Application No. V-83191
covering a parcel of land situated at Pugad
Lawin, Quezon City, consisting of 256 square
meters. Upon favorable report and
recommendation of the District Land Officer,
Guerreros application was approved per Order
of Award (Exhibit "B"), with the boundaries of the
land awarded specified as follows: N-Lot No. 10-
C, Psd-37801; S-Culiat Creek; E-Road; and W-
Public Land. A sketch of the land awarded is
contained at the back of the Order of Award.
Subsequently, Miscellaneous Sales Patent No.
8991 dated August 16, 1982 was issued in favor
of respondent. Pursuant thereto the
corresponding Original Certificate of Title No. 0-
28 was issued on August 27, 1982.
On July 29, 1983, one Angelina Bustamante
filed a protest with the Bureau of Lands claiming
that respondent obtained the sales patent
through fraud, false statement of facts and/or
omission of material facts considering that 174
square meters awarded to respondent covered
the land where her house is situated and where
she has been residing since 1961.
A formal investigation was conducted by the
Bureau of Lands, after which the Director of
Lands issued an order dismissing the protest of
Angelina Z. Bustamante. The dismissal of the
protest was affirmed by the then Minister of
Natural Resources and by the Office of the
President in a Decision dated July 22, 1985.
Bustamante filed a motion for reconsideration of
the Decision dated July 22, 1985. Acting on the
motion for reconsideration, the President, ,
ordered that the case be remanded to the DENR
[Department of Environment and Natural
Resources] for the latters office to conduct an
ocular investigation and resurvey of the disputed
area. The said directive is contained in the Order
dated October 30, 1987(Exhibit "J").
Pursuant to the order of the Office of the
President, an ocular investigation and relocation
survey was conducted by the DENR. A report
(Exhibit "K") was thereafter submitted with a
finding that 83 square meters of the titled
property of Guerrero consisting of 174 square
meters is under ACTUAL PHYSICAL
POSSESSION of Marcelo Bustamante (husband
of Angelina Bustamante) with only 91 square
meters under the physical possession of
Guerrero. It was also found out that OCT No. 0-
28 is supposed to be traversed by a road 3
meters wide, as even the Order of Award in
favor of Guerrero, shows by the boundaries of
the land indicated therein, viz: bounded on the
N-Lot No. 10-C, Psd-37801, S-Culiat Creek, E-
Road and W-Public Land.
On January 10, 1989, the Office of the
President, upon receipt of the [DENR] Ocular
Investigation and Relocation Survey Report
(Exhibit "K") , issued an order directing the
DENR to implement the Report for the proper
correction of the technical description of the
land covered by OCT No. 0-28 issued to
respondent.
Pursuant to the directive of the Office of the
President, the Director of Lands [on behalf of the
Republic of the Philippines] instituted the instant
action [Petition for Amendment of Plan and
Technical Description of OCT No. 0-28 in the
name of Benjamin Guerrero] on November 7,
1989.
On April 6, 1990, the [respondent] Benjamin
Guerrero filed a motion to dismiss the petition
, alleging among other things, that the RTC of
Quezon City was without jurisdiction over the
Director of Lands petition and that the said
petition was defective in form and substance,
inasmuch as it failed to name [Guerrero] who
holds a certificate of title (OCT No. 0-28) over
the properties subject of the petition, as
respondent in the action, and that the title
sought to be amended was irrevocable and can
no longer be questioned.
In its order dated July 8, 1992, the lower court
denied the said motion to dismiss for lack of
merit. Trial of the petition followed with the
Director of Lands, on one hand, and [Guerrero],
on the other, presenting their respective
evidence and witnesses. 3 [Words in bracket
added.]
On July 13, 1995, the RTC, on the postulate that
petitioner Republic failed to prove its allegation
that respondent obtained the sales patent and
the certificate of title through fraud and
misrepresentation, rendered judgment finding for
the latter. The trial court likewise ruled that the
original certificate of title (OCT No. 0-28) in the
name of respondent acquired the characteristics
of indefeasibility after the expiration of one (1)
year from the entry of the decree of registration.
Consequently, petitioner interposed an appeal to
the CA, which, in a decision dated February 12,
1998, affirmed that of the trial court, rationalizing
as follows:
It is a settled rule that a certificate of title issued
pursuant to any grant or patent involving public
lands is as conclusive and indefeasible as any
other certificate of title issued upon private lands
in ordinary or cadastral registration proceedings.
The effect of registration of a homestead or any
other similar patent and the issuance of a
certificate of title to the patentee is to vest in him
an incontestable title to the land, in the same
manner as if ownership had been determined by
final decree of the court, and the title so issued
is absolutely conclusive and indisputable.
In the same way, therefore, that a decree of
registration may be reviewed or reopened within
one year after the entry thereof, upon a charge
of actual fraud, a patent awarded in accordance
with the Public Land Law may be reviewed
within one year from the date of the order for the
issuance of the patent also on the ground of
actual fraud.
xx
x xx
x xxx
xxx there is no showing that at the time the
[respondent] applied for his miscellaneous sales
patent, there were third persons who had been
in occupation of the land applied for. While
subsequent survey documents, prepared as a
consequence of the protest filed by the
Bustamentes, report the possession of the
Bustamantes of a portion of the land, and the
erection of their house thereon, these reports do
not indicate if such structures were existing at
the time the application of the [respondent] was
filed in 1964.
There is no support, therefore, to the submission
that the [respondent] was guilty of actual fraud in
the acquisition of his miscellaneous sales
patent, and subsequently, OCT No. 0-
28. 4 (Words in bracket added)
Petitioner then moved for a reconsideration of
the above decision but the same was denied by
the appellate court in its resolution of March 23,
1998. 5
Hence, this recourse, petitioner Republic
contending that the appellate court erred in
holding -
I. That a certificate of title issued
pursuant to any grant or patent involving
public lands is conclusive and
indefeasible despite the fact that
respondents title was procured through
fraud and misrepresentation.
II. That there is no basis for the
submission that respondent was guilty
of actual fraud in the acquisition of his
miscellaneous sales patent despite the
final ruling of the Office of the President
from which ruling respondent did not
appeal.
III. That the Director of Lands cannot
raise the issue of possession of a third
person of the land, or a portion thereof,
after the award and issuance of the
patent to the applicant despite the
obvious fact that the protest was filed
within one year from the issuance of
patent. 6
Petitioner argues in esse that respondent
procured his sales patent and certificate of title
through fraud and misrepresentation. To support
its basic posture, petitioner points to the
verification survey conducted by Engr. Ernesto
Erive of the DENR, which, to petitioner, argues
for the proposition that respondents entitlement
to a public land award should have been limited
to a 91-square meter area instead of the 174
square meters eventually granted.
On the other hand, respondent contends that his
OCT No. 0-28 which he secured pursuant to a
sales patent is conclusive and indefeasible
under the Torrens system of registration. As
such, his title can no longer be altered,
impugned or cancelled.
At the outset, it must be pointed out that the
essential issue raised in this Petition the
presence of fraud is factual. As a general
rule, this Court does not review factual matters,
as only questions of law may be raised in a
petition for review on certiorari filed with this
Court. And as the Court has consistently held,
factual findings of trial courts, when adopted and
confirmed by the CA, are final and conclusive on
this Court, 7 save when the judgment of the
appellate court is based on a misapprehension
of facts or factual inferences manifestly incorrect
or when that court overlooked certain relevant
facts which, if properly considered, would justify
a different conclusion. 8 Obviously, petitioner is
invoking these exceptions toward having the
Court review the factual determinations of the
CA.
The basic issue in this case turns on whether or
not petitioner has proven by clear and
convincing evidence that respondent procured
Miscellaneous Sales Patent (MSP) No. 8991
and OCT No. 0-28 through fraud and
misrepresentation.
It bears to stress that the property in question,
while once part of the lands of the public domain
and disposed of via a miscellaneous sales
arrangement, is now covered by a Torrens
certificate. Grants of public land were brought
under the operation of the Torrens system by
Act No. 496, or the Land Registration Act of
1903. Under the Torrens system of registration,
the government is required to issue an official
certificate of title to attest to the fact that the
person named is the owner of the property
described therein, subject to such liens and
encumbrances as thereon noted or what the law
warrants or reserves. 9 As it were, the Torrens
system aims to obviate possible conflicts of title
by giving the public the right to rely upon the
face of the Torrens certificate and to dispense,
as a rule, with the necessity of inquiring further;
on the part of the registered owner, the system
gives him complete peace of mind that he would
be secured in his ownership as long as he has
not voluntarily disposed of any right over the
covered land. 10
Section 122 of Act No. 496 provides:
SEC. 122. Whenever public lands belonging
to the Government of the [Republic of the
Philippines] are alienated, granted, or conveyed
to persons or to public or private corporations,
the same shall be brought forthwith under the
operation of this Act and shall become
registered lands. It shall be the duty of the
official issuing the instrument of alienation,
grant, or conveyance in behalf of the
Government to cause such instrument before its
delivery to the grantee, to be filed with the
register of deeds for the province where the land
lies and to be there registered like other deeds
and conveyances, whereupon a certificate shall
be entered as in other cases of registered land,
and an owners duplicate certificate issued to the
grantee. The deed, grant, or instrument of
conveyance from the Government shall not take
effect as a conveyance or bind the land, but
shall operate only as a contract between the
Government and the grantee and as evidence of
authority to the clerk or register of deeds to
make registration. The act of registration shall
be the operative act to convey and affect the
land, and in all cases under this Act registration
shall be made in the office of the register of
deeds for the province where the land lies. xxx.
(Words in bracket added)
Upon its registration, the land falls under the
operation of Act No. 496 and becomes
registered land. Time and again, we have said
that a Torrens certificate is evidence of an
indefeasible title to property in favor of the
person whose name appears thereon. 11
However, Section 38 of Act No. 496 recognizes
the right of a person deprived of land to institute
an action to reopen or revise a decree of
registration obtained by actual fraud. Section 38
of Act No. 496 says so:
SEC. 38. xxx. Every decree of registration
shall bind the land, and quiet title thereto,
subject only to the exceptions stated in the
following section. It shall be conclusive upon and
against all persons, including the [Republic of
the Philippines] and all the branches thereof, .
Such decree shall not be opened by reason of
the absence, minority, or other disability of any
person affected thereby, nor by any proceeding
in any court for reversing judgments or decrees,
subject, however, to the right of any person
deprived of the land or of any estate or interest
therein by decree of registration obtained by
actual fraud, to file in the proper Court of First
Instance [now Regional Trial Court] a petition for
review of the decree of registration within one
year after entry of the decree provided no
innocent purchaser for value has acquired an
interest. Upon the expiration of said term of one
year, every decree or certificate of title issued in
accordance with this section shall be
incontrovertible. xxx. (Emphasis and words in
bracket supplied)
Fraud is of two kinds: actual or constructive.
Actual or positive fraud proceeds from an
intentional deception practiced by means of the
misrepresentation or concealment of a material
fact. Constructive fraud is construed as a fraud
because of its detrimental effect upon public
interests and public or private confidence, even
though the act is not done with an actual design
to commit positive fraud or injury upon other
persons. 12
Fraud may also be either extrinsic or intrinsic.
Fraud is regarded as intrinsic where the
fraudulent acts pertain to an issue involved in
the original action, or where the acts constituting
the fraud were or could have been litigated
therein. The fraud is extrinsic if it is employed to
deprive parties of their day in court and thus
prevent them from asserting their right to the
property registered in the name of the
applicant. 13
The distinctions assume significance because
only actual and extrinsic fraud had been
accepted and is contemplated by the law as a
ground to review or reopen a decree of
registration. Thus, relief is granted to a party
deprived of his interest in land where the fraud
consists in a deliberate misrepresentation that
the lots are not contested when in fact they are;
or in willfully misrepresenting that there are no
other claims; or in deliberately failing to notify
the party entitled to notice; or in inducing him not
to oppose an application; or in misrepresenting
about the identity of the lot to the true owner by
the applicant causing the former to withdraw his
application. In all these examples, the overriding
consideration is that the fraudulent scheme of
the prevailing litigant prevented a party from
having his day in court or from presenting his
case. The fraud, therefore, is one that affects
and goes into the jurisdiction of the court. 14
We have repeatedly held that relief on the
ground of fraud will not be granted where the
alleged fraud goes into the merits of the case, is
intrinsic and not collateral, and has been
controverted and decided. Thus, we have
underscored the denial of relief where it appears
that the fraud consisted in the presentation at
the trial of a supposed forged document, or a
false and perjured testimony, or in basing the
judgment on a fraudulent compromise
agreement, or in the alleged fraudulent acts or
omissions of the counsel which prevented the
petitioner from properly presenting the case. 15
Petitioner fails to convince the Court that the
facts relied upon by it to justify a review of the
decree constitute actual and extrinsic fraud. It
has not adduced adequate evidence that would
show that respondent employed actual and
extrinsic fraud in procuring the patent and the
corresponding certificate of title. Petitioner
miserably failed to prove that it was prevented
from asserting its right over the lot in question
and from properly presenting its case by reason
of such fraud. In fact, other than its peremptory
statement in its petition filed before the trial court
that "the patentee, Benjamin Guerrero, obtained
the above indicated sales patent through fraud,
false statement of facts and/or omission of
material facts," 16 petitioner did not specifically
allege how fraud was perpetrated by respondent
in procuring the sales patent and the certificate
of title. Nor was any evidence proffered to
substantiate the allegation. Fraud cannot be
presumed, and the failure of petitioner to prove it
defeats it own cause.
Well-settled is the rule that the party alleging
fraud or mistake in a transaction bears the
burden of proof. 17 The circumstances evidencing
fraud are as varied as the people who perpetrate
it in each case. It may assume different shapes
and forms; it may be committed in as many
different ways. 18 Thus, the law requires that
fraud be established, not just by preponderance
of evidence, but by clear and convincing
evidence. 19
Petitioner relies heavily on the verification
survey report 20 which stated that respondent
Guerrero was entitled to only 91 square meters
of the subject lot instead of 174 square meters
which was awarded to him. There is, however,
no proof that the area eventually awarded to
respondent was intentionally and fraudulently
increased. It was never proven that respondent
was a party to any fraud that led to the award of
a bigger area of 174 square meters instead of
91 square meters. Petitioner even failed to give
sufficient proof of any error which may have
been committed by its agents who had surveyed
the subject property nor had petitioner offered a
sensible explanation as to the reason for such
discrepancy. Thus, the presumption of regularity
in the performance of official functions must be
respected.
This Court agrees with the RTC that the
issuance of the sales patent over the subject lot
was made in accordance with the procedure laid
down by Commonwealth Act No. 141, as
amended, otherwise known as the Public Land
Act. 21 Under Section 91 thereof, an investigation
should be conducted for the purpose of
ascertaining the veracity of the material facts set
out in the application. 22 The law also requires
sufficient notice to the municipality and barrio
where the land is located in order to give
adverse claimants the opportunity to present
their claims. 23
In the instant case, records reveal that on
December 22, 1964, a day after respondent filed
his miscellaneous sales application, an actual
investigation and site verification of the parcel of
land was conducted by Land Investigator
Alfonso Tumbocon who reported that the land
was free from claims and conflicts. 24 Likewise,
the notice of sale of the lot in question was
posted at the District Land Office in San Miguel,
Manila, at the Quezon City Hall, and at Pugad
Lawin, Quezon City for 30 consecutive days
from February 17, 1965 to March 17, 1965
which was the date scheduled for the sale of the
lot. The said notice was worded as follows:
If there is any adverse claim to the land, such
claim must be filed at the Bureau of Lands,
Manila on or before the date of the sale;
otherwise such claim shall forever be barred. 25
Further, the "Order of Award" 26 dated May 20,
1971, as well as the "Issuance of
Patent" 27 dated June 28, 1982 were both duly
signed by the Director of Lands. The "Order of
Award" even declared that Guerrero has in good
faith established his residence on the land in
question. On the other hand, the "Issuance of
Patent" stated that the land consisting of 174
square meters is free from any adverse claim
and that Guerrero has fully paid the purchase
price of the lot. Having complied with all the
requirements of the law preliminary to the
issuance of the patent, respondent was thus
issued MSP No. 8991 dated August 16, 1982.
Thereafter, the corresponding OCT No. 0-28
was issued on August 27, 1982 in the name of
respondent Guerrero.
At any rate, by legal presumption, public officers
are deemed to have regularly performed their
official duties. Thus, the proceedings for land
registration that led to the issuance of MSP No.
8991 and OCT No. 0-28 in respondents name
are presumptively regular and proper. To
overturn this legal presumption will not only
endanger judicial stability, but also violate the
underlying principle of the Torrens system.
Indeed, to do so would reduce the vaunted legal
indefeasibility of Torrens titles to meaningless
verbiage. 28 Besides, this presumption of
regularity has not been overcome by the
evidence presented by petitioner. We, therefore,
cannot sustain petitioners contention that fraud
tainted the sales patent granted to respondent
Guerrero, as well as the certificate of title issued
in consequence thereof.
Granting that Guerrero committed extrinsic and
actual fraud, petitioner failed to avail itself of the
remedy within the prescribed period. Under
Section 38 of Act No. 496, a petition for
reopening and review of the decree of
registration must be filed within one year from
the date of entry of said decree.
In the case of public land grants or patents, the
one-year period commences from the issuance
of the patent by the government. 29
In the instant case, the sales patent was issued
to respondent on August 16, 1982, while
petitioner instituted an action to amend
respondents certificate of title on November 7,
1989 or after the lapse of more than seven (7)
years from the issuance of the patent. Clearly,
petitioner failed to timely avail of the remedy to
contest Guerreros title.
Petitioner argues that the right of the State for
the reversion of unlawfully acquired property is
not barred by prescription. Thus, it can still
recover the land granted to respondent.
True, prescription, basically, does not run
against the State and the latter may still bring an
action, even after the lapse of one year, for the
reversion to the public domain of lands which
have been fraudulently granted to private
individuals. 30 However, this remedy of reversion
can only be availed of in cases of fraudulent or
unlawful inclusion of the land in patents or
certificates of title. In the present case, petitioner
cannot successfully invoke this defense for, as
discussed earlier, it was never proven that
respondents patent and title were obtained
through actual fraud or other illegal means.
Lest it be overlooked, a piece of land covered by
a registered patent and the corresponding
certificate of title ceases to be part of the public
domain. As such, it is considered a private
property over which the Director of Lands has
neither control nor jurisdiction. 31
Petitioner likewise insists that respondents title
had yet to attain the status of indefeasibility. As
argued, Angelina Bustamante was able to timely
file a protest on July 29, 1983, which was well
within the one-year prescriptive period.
We do not agree.
While Angelina Bustamante indeed protested
the award of a sales patent in favor of
respondent, the protest was, however, filed with
the Bureau of Lands instead of with the regional
trial court as mandated by the aforequoted
provision of Section 38 of Act No. 496. Said
provision expressly states that a petition for
review of a decree of registration shall be filed in
the "proper Court of First Instance" (now
Regional Trial Court). The law did not say that
such petition may be filed with an administrative
agency like the Bureau of Lands. To be sure,
what the law contemplates in allowing a review
of the decree of registration is a full-blown trial
before a regular court where each party could be
afforded full opportunity to present his/its case
and where each of them must establish his case
by preponderance of evidence and not by mere
substantial evidence, the usual quantum of proof
required in administrative proceedings. The
concept of "preponderance of evidence" refers
to evidence which is of greater weight, or more
convincing, than that which is offered in
opposition to it; at bottom, it means probability of
truth. 32On the other hand, substantial evidence
refers to such relevant evidence as a reasonable
mind might accept as adequate to support a
conclusion, even if other minds equally
reasonable might conceivably opine otherwise. 33
As the review of a decree of registration
constitutes an attack on the very integrity of land
titles and the Torrens system, a full-blown trial
on the merits before a regular court is necessary
for the purpose of achieving a more in-depth and
thorough determination of all issues involved.
Hence, contrary to petitioners assertion, the
protest filed by Bustamante with the Bureau of
Lands cannot be considered in the context of a
petition to review the decree of registration
issued to respondent. It was only on November
7, 1989 that such petition was filed by the
Director of Lands with the RTC and obviously, it
was way beyond the one-year period prescribed
by law.
It is worth stressing that the Torrens system was
adopted in this country because it was believed
to be the most effective measure to guarantee
the integrity of land titles and to protect their
indefeasibility once the claim of ownership is
established and recognized. If a person
purchases a piece of land on the assurance that
the sellers title thereto is valid, he should not
run the risk of being told later that his acquisition
was ineffectual after all. This would not only be
unfair to him. What is worse is that if this were
permitted, public confidence in the system would
be eroded and land transactions would have to
be attended by complicated and not necessarily
conclusive investigations and proof of
ownership. The further consequence would be
that land conflicts could be even more abrasive,
if not even violent. The government, recognizing
the worthy purposes of the Torrens system,
should be the first to accept the validity of titles
issued thereunder once the conditions laid down
by the law are satisfied. 34
Instead of stabilizing the Torrens system,
petitioner, in filing a suit for the amendment of
OCT No. 0-28, derogates the very integrity of
the system as it gives the impression to Torrens
title holders, like herein respondent, that their
titles can be questioned by the same authority
who had approved their titles. In that case, no
Torrens title holder shall be at peace with the
ownership and possession of his land, for land
registration officers can question his title any
time they make a finding unfavorable to said title
holder. This is all the more frustrating for
respondent Guerrero considering that he had
bought the subject lot from the government
itself, the very same party who is now impugning
his title.
While the Torrens system is not a mode of
acquiring titles to lands but merely a system of
registration of titles to lands, 35 justice and equity
demand that the titleholder should not be made
to bear the unfavorable effect of the mistake or
negligence of the States agents, in the absence
of proof of his complicity in a fraud or of manifest
damage to third persons. The real purpose of
the Torrens system is to quiet title to land and
put a stop forever to any question as to the
legality of the title, except claims that were noted
in the certificate at the time of the registration or
that may arise subsequent thereto. 36 Otherwise,
the integrity of the Torrens system shall forever
be sullied by the ineptitude and inefficiency of
land registration officials, who are ordinarily
presumed to have regularly performed their
duties. 37
Respondents certificate of title, having been
registered under the Torrens system, was thus
vested with the garment of indefeasibility.
WHEREFORE, the instant petition is hereby
DENIED and the assailed decision is
AFFIRMED.
SO ORDERED.
EDUARDO S. BARANDA and ALFONSO
HITALIA, petitioners,
vs.
HONORABLE JUDGE TITO GUSTILO,
ACTING REGISTER OF DEEDS AVITO
SACLAUSO, HONORABLE COURT OF
APPEALS, and ATTY. HECTOR P.
TEODOSIO, respondents.
Eduardo S. Baranda for petitioners.
Rico & Associates for private respondents.
GUTIERREZ, JR., J.:
Eduardo S. Baranda and Alfonso Hitalia were
the petitioners in G.R. No. 64432 and the private
respondents in G.R. No. 62042. The subject
matter of these two (2) cases and the instant
case is the same a parcel of land designated
as Lot No. 4517 of the Cadastral Survey of Sta.
Barbara, Iloilo covered by Original Certificate of
Title No. 6406.
The present petition arose from the same facts
and events which triggered the filing of the
earlier petitions. These facts and events are
cited in our resolution dated December 29, 1983
in G.R. No. 64432, as follows:
. . . This case has its origins in a
petition for reconstitution of title
filed with the Court of First
Instance of Iloilo involving a
parcel of land known as Lot No.
4517 of the Sta. Barbara
Cadastre covered by Original
Certificate of Title No. 6406 in
the name of Romana Hitalia.
Eventually, Original Certificate
of Title No. 6406 was cancelled
and Transfer Certificate of Title
No. 106098 was issued in the
names of Alfonso Hitalia and
Eduardo S. Baranda The Court
issued a writ of possession
which Gregorio Perez, Maria P.
Gotera and Susana Silao
refused to honor on the ground
that they also have TCT No.
25772 over the same Lot No.
4517. The Court, after
considering the private
respondents' opposition and
finding TCT No. 25772
fraudulently acquired, ordered
that the writ of possession be
carried out. A motion for
reconsideration having been
denied, a writ of demolition was
issued on March 29, 1982.
Perez and Gotera filed a petition
for certiorari and prohibition with
the Court of Appeals. On August
6, 1982, the Court of Appeals
denied the petition. Perez and
Gotera filed the petition for
review on certiorari
denominated as G.R. No. 62042
before the Supreme Court. As
earlier stated the petition was
denied in a resolution dated
January 7,1983. The motion for
reconsideration was denied in
another resolution dated March
25, 1983, which also stated that
the denial is final. This decision
in G.R. No. 62042, in
accordance with the entry of
judgment, became final on
March 25, 1983. The petitioners
in the instant case G.R. No.
64432--contend that the writs of
possession and demolition
issued in the respondent court
should now be implemented;
that Civil Case No. 00827
before the Intermediate
Appellate Court was filed only to
delay the implementation of the
writ; that counsel for the
respondent should be held in
contempt of court for engaging
in a concerted but futile effort to
delay the execution of the writs
of possession and demolition
and that petitioners are entitled
to damages because of
prejudice caused by the filing of
this petition before the
Intermediate Appellate Court.
On September 26, 1983, this
Court issued a Temporary
Restraining Order ' to maintain
the status quo, both in the
Intermediate Appellate Court
and in the Regional Trial Court
of Iloilo. Considering that
(l)there is merit in the instant
petition for indeed the issues
discussed in G.R. No. 64432 as
raised in Civil Case No. 00827
before the respondent court
have already been passed upon
in G.R. No. 62042; and (2) the
Temporary Restraining Order
issued by the Intermediate
Appellate Court was only
intended not to render the
petition moot and academic
pending the Court's
 consideration of the issues, the
Court RESOLVED to DIRECT
the respondent Intermediate
Appellate Court not to take
cognizance of issues already
resolved by this Court and
accordingly DISMISS the
petition in Civil Case No. 00827.
Immediate implementation of
the writs of possession and
demolition is likewise ordered.
(pp. 107-108, Rollo G.R. No.
64432)
On May 9, 1984, the Court issued a resolution
denying with finality a motion for reconsideration
of the December 29, 1983 resolution in G.R. No.
64432. On this same date, another resolution
was issued, this time in G.R. No. 62042,
referring to the Regional Trial Court of Iloilo the
ex-parte motion of the private respondents
(Baranda and Hitalia) for execution of the
judgment in the resolutions dated January 7,
1983 and March 9, 1983. In the meantime, the
then Intermediate Appellate Court issued a
resolution dated February 10, 1984, dismissing
Civil Case No. 00827 which covered the same
subject matter as the Resolutions above cited
pursuant to our Resolution dated December 29,
1983. The resolution dated December 29, 1983
in G.R. No. 64432 became final on May 20,
1984.
Upon motions of the petitioners, the Regional
Trial Court of Iloilo, Branch 23 presided by
Judge Tito G. Gustilo issued the following order:
Submitted are the following
motions filed by movants
Eduardo S. Baranda and
Alfonso Hitalia through counsel
dated August 28, 1984:
(a) Reiterating Motion for
Execution of Judgment of
Resolutions dated January 7,
1983 and March 9, 1983
Promulgated by Honorable
Supreme Court (First Division)
in G.R. No. 62042;
(b) Motion for Execution of
Judgment of Resolution dated
December 29, 1983
Promulgated by Honorable
Supreme Court (First Division)
in G.R. No. 64432;
(c) The Duties of the Register of
Deeds are purely ministerial
under Act 496, therefore she
must register all orders,
judgment, resolutions of this
Court and that of Honorable
Supreme Court.
Finding the said motions
meritorious and there being no
opposition thereto, the same is
hereby GRANTED.
WHEREFORE, Transfer
Certificate of Title No. T-25772
is hereby declared null and void
and Transfer Certificate of Title
No. T-106098 is hereby
declared valid and subsisting
title concerning the ownership of
Eduardo S. Baranda and
Alfonso Hitalia, all of Sta.
Barbara Cadastre.
The Acting Register of Deeds of
Iloilo is further ordered to
register the Subdivision
Agreement of Eduardo S.
Baranda and Alfonso Hitalia as
prayed for." (p. 466, Rollo--G.R.
No. 64432)
The above order was set aside on October 8,
1984 upon a motion for reconsideration and
manifestation filed by the Acting Registrar of
Deeds of Iloilo, Atty. Helen P. Sornito, on the
ground that there was a pending case before
this Court, an Action for Mandamus, Prohibition,
Injunction under G.R. No. 67661 filed by Atty.
Eduardo Baranda, against the former which
remained unresolved.
In view of this development, the petitioners filed
in G.R. No. 62042 and G.R. No. 64432 ex-parte
motions for issuance of an order directing the
Regional Trial Court and Acting Register of
Deeds to execute and implement the judgments
of this Court. They prayed that an order be
issued:
1. Ordering both the Regional
Trial Court of Iloilo Branch XXIII,
under Hon. Judge Tito G.
Gustilo and the acting Register
of Deeds Helen P. Sornito to
register the Order dated
September 5, 1984 of the lower
court;
2. To cancel No.T-25772.
Likewise to cancel No.T-106098
and once cancelled to issue
new certificates of title to each
 of Eduardo S. Baranda and
Alfonso Hitalia;
Plus other relief and remedies
equitable under the premises.
(p. 473, 64432 Rollo)
Acting on these motions, we issued on
September 17,1986 a Resolution in G.R. No.
62042 and G.R. No. 64432 granting the motions
as prayed for. Acting on another motion of the
same nature filed by the petitioners, we issued
another Resolution dated October 8, 1986
referring the same to the Court Administrator for
implementation by the judge below.
In compliance with our resolutions, the Regional
Trial Court of Iloilo, Branch 23 presided by
Judge Tito G. Gustilo issued two (2) orders
dated November 6,1986 and January 6,1987
respectively, to wit:
ORD ER
This is an Ex-parte Motion and
Manifestation submitted by the
movants through counsel on
October 20, 1986; the
Manifestation of Atty. Helen
Sornito, Register of Deeds of
the City of Iloilo, and formerly
acting register of deeds for the
Province of Iloilo dated October
23, 1986 and the Manifestation
of Atty. Avito S. Saclauso,
Acting Register of Deeds,
Province of Iloilo dated
November 5, 1986.
Considering that the motion of
movants Atty. Eduardo S.
Baranda and Alfonso Hitalia
dated August 12, 1986 seeking
the full implementation of the
writ of possession was granted
by the Honorable Supreme
Court, Second Division per its
Resolution dated September
17,1986, the present motion is
hereby GRANTED.
WHEREFORE, the Acting
Register of Deeds, Province of
Iloilo, is hereby ordered to
register the Order of this Court
dated September 5, 1984 as
prayed for.
xxx xxx xxx
ORD ER
This is a Manifestation and
Urgent Petition for the
Surrender of Transfer Certificate
of Title No. T-25772 submitted
by the petitioners Atty. Eduardo
S. Baranda and Alfonso Hitalia
on December 2, 1986, in
compliance with the order of this
Court dated November 25, 1
986, a Motion for Extension of
Time to File Opposition filed by
Maria Provido Gotera through
counsel on December 4, 1986
which was granted by the Court
pursuant to its order dated
December 15, 1986.
Considering that no Opposition
was filed within the thirty (30)
days period granted by the
Court finding the petition
tenable, the same is hereby
GRANTED.
WHEREFORE, Maria Provido
Gotera is hereby ordered to
surrender Transfer Certificate of
Title No. T-25772 to this Court
within ten (10) days from the
date of this order, after which
period, Transfer Certificate of
Title No. T-25772 is hereby
declared annulled and the
Register of Deeds of Iloilo is
ordered to issue a new
Certificate of Title in lieu thereof
in the name of petitioners Atty.
Eduardo S. Baranda and
Alfonso Hitalia, which certificate
shall contain a memorandum of
the annulment of the
outstanding duplicate. (pp. 286-
287, Rollo 64432)
On February 9, 1987, Atty. Hector Teodosio, the
counsel of Gregorio Perez, private respondent in
G.R. No. 64432 and petitioner in G.R. No.
62042, filed a motion for explanation in relation
to the resolution dated September 17, 1986 and
manifestation asking for clarification on the
following points:
a. As to the prayer of Atty.
Eduardo Baranda for the
cancellation of TCT T-25772,
should the same be referred to
the Court of Appeals (as
mentioned in the Resolution of
November 27, 1985) or is it
already deemed granted by
 implication (by virtue of the
Resolution dated September 17,
1986)?
b. Does the Resolution dated
September 17, 1986 include not
only the implementation of the
writ of possession but also the
cancellation of TCT T-25772
and the subdivision of Lot 4517?
(p. 536, Rollo 4432)
Acting on this motion and the other motions filed
by the parties, we issued a resolution dated May
25, 1987 noting all these motions and stating
therein:
xxx xxx xxx
Since entry of judgment in G.R.
No. 62042 was made on
January 7, 1983 and in G.R. No.
64432 on May 30, 1984, and all
that remains is the
implementation of our
resolutions, this COURT
RESOLVED to refer the matters
concerning the execution of the
decisions to the Regional Trial
Court of Iloilo City for
appropriate action and to apply
disciplinary sanctions upon
whoever attempts to trifle with
the implementation of the
resolutions of this Court. No
further motions in these cases
will be entertained by this Court.
(p. 615, Rollo-64432)
In the meantime, in compliance with the
Regional Trial Court's orders dated November 6,
1986 and January 6, 1987, Acting Register of
Deeds AvitoSaclauso annotated the order
declaring Transfer Certificate of Title No. T-
25772 as null and void, cancelled the same and
issued new certificates of titles numbers T-
111560, T-111561 and T-111562 in the name of
petitioners Eduardo S. Baranda and Alfonso
Hitalia in lieu of Transfer Certificate of TItle No.
T-106098.
However, a notice of lis pendens "on account of
or by reason of a separate case (Civil Case No.
15871) still pending in the Court of Appeals" was
carried out and annotated in the new certificates
of titles issued to the petitioners. This was
upheld by the trial court after setting aside its
earlier order dated February 12, 1987 ordering
the cancellation of lis pendens.
This prompted the petitioners to file another
motion in G.R, No. 62042 and G.R. No. 64432 to
order the trial court to reinstate its order dated
February 12, 1987 directing the Acting Register
of Deeds to cancel the notice of lis pendensin
the new certificates of titles.
In a resolution dated August 17, 1987, we
resolved to refer the said motion to the Regional
Trial Court of Iloilo City, Branch 23 for
appropriate action.
Since respondent Judge Tito Gustilo of the
Regional Trial Court of Iloilo, Branch 23 denied
the petitioners' motion to reinstate the February
12, 1987 order in another order dated
September 17, 1987, the petitioners filed this
petition for certiorari, prohibition and mandamus
with preliminary injunction to compel the
respondent judge to reinstate his order dated
February l2, 1987 directing the Acting Register
of Deeds to cancel the notice of lis
pendens annotated in the new certificates of
titles issued in the name of the petitioners.
The records show that after the Acting Register
of Deeds annotated a notice of is pendens on
the new certificates of titles issued in the name
of the petitioners, the petitioners filed in the
reconstitution case an urgent ex-parte motion to
immediately cancel notice of lis pendens
annotated thereon.
In his order dated February 12, 1987,
respondent Judge Gustilo granted the motion
and directed the Acting Register of Deeds of
Iloilo to cancel the lis pendens found on Transfer
Certificate of Title Nos. T-106098; T-111560; T-
111561 and T-111562.
Respondent Acting Register of Deeds Avito
Saclauso filed a motion for reconsideration of
the February 12, 1987 order stating therein:
That the undersigned hereby
asks for a reconsideration of the
said order based on the second
paragraph of Section 77 of P.D.
1529, to wit:
"At any time
after final
judgment in
favor of the
defendant or
other
disposition of
the action such
as to terminate
finally all rights
of the plaintiff in
 and to the land
and/or buildings
involved, in any
case in which a
memorandum
or notice of Lis
Pendens has
been registered
as provided in
the preceding
section, the
notice of Lis
Pendens shall
be deemed
cancelled upon
the registration
of a certificate
of the clerk of
court in which
the action or
proceeding was
pending stating
the manner of
disposal
thereof."
That the lis pendens under
Entry No. 427183 was
annotated on T-106098, T-
111560, T-111561 and T-
111562 by virtue of a case
docketed as Civil Case No.
15871, now pending with the
Intermediate Court of Appeals,
entitled, "Calixta Provido,
Ricardo Provido, Sr., Maria
Provido and Perfecto Provido,
Plaintiffs, versus Eduardo
Baranda and Alfonso Hitalia,
Respondents."
That under the above-quoted
provisions of P.D. 152, the
cancellation of subject Notice of
Lis Pendens can only be made
or deemed cancelled upon the
registration of the certificate of
the Clerk of Court in which the
action or proceeding was
pending, stating the manner of
disposal thereof.
Considering that Civil Case No.
1587, upon which the Notice of
Lis Pendens was based is still
pending with the Intermediate
Court of Appeals, only the
Intermediate Court of Appeals
and not this Honorable Court in
a mere cadastral proceedings
can order the cancellation of the
Notice of Lis Pendens. (pp. 68-
69, Rollo)
Adopting these arguments and on the ground
that some if not all of the plaintiffs in Civil Case
No. 15871 were not privies to the case affected
by the Supreme Court resolutions, respondent
Judge Tito Gustilo set aside his February 12,
1987 order and granted the Acting Register of
Deeds' motion for reconsideration.
The issue hinges on whether or not the
pendency of the appeal in Civil Case No. 15871
with the Court of Appeals prevents the court
from cancelling the notice of lis pendens in the
certificates of titles of the petitioners which were
earlier declared valid and subsisting by this
Court in G.R. No. 62042 and G.R. No. 64432. A
corollary issue is on the nature of the duty of a
Register of Deeds to annotate or annul a notice
of lis pendens in a torrens certificate of title.
Civil Case No. 15871 was a complaint to seek
recovery of Lot No. 4517 of Sta. Barbara
Cadastre Iloilo, (the same subject matter of G.R.
No 62042 and G.R. No. 64432) from petitioners
Baranda and Hitalia filed by Calixta Provido,
Ricardo Provido, Maxima Provido and Perfecta
Provido before the Regional Trial Court of Iloilo,
Branch 23. At the instance of Atty. Hector P.
Teodosio, the Provides' counsel, a notice of is
pendens was annotated on petitioners'
Certificate of Title No. T-106098 covering Lot
No. 4517, Sta. Barbara Cadastre.
Acting on a motion to dismiss filed by the
petitioners, the court issued an order dated
October 24, 1984 dismissing Civil Case No.
15871.
The order was then appealed to the Court of
Appeals. This appeal is the reason why
respondent Judge Gustilo recalled the February
12, 1987 order directing the Acting Register of
Deeds to cancel the notice of lis pendens
annotated on the certificates of titles of the
petitioners.
This petition is impressed with merit.
Maria Provido Gotera was one of the petitioners
in G.R. No. 62042. Although Calixta Provido,
Ricardo Provido, Maxima Provido and Perfecta
Provido, the plaintiffs in Civil Case No. 15871
were not impleaded as parties, it is very clear in
the petition that Maria Provido was acting on
behalf of the Providos who allegedly are her co-
owners in Lot No. 4517, Sta. Barbara Cadastre
as shown by Transfer Certificate of Title No. T-
25772 issued in her name and the names of the
plaintiffs in Civil Case No. 15871, among others.
(Annex "E" G.R. No. 62042, p. 51, Rollo) In fact,
one of the issues raised by petitioners Maria
Provido Gotera and Gregoria Perez in G.R. No.
62042 was as follows:
xxx xxx xxx
2. Whether or not, in the same
reconstitution proceedings,
respondent Judge Midpantao L.
Adil had the authority to declare
as null and void the transfer
certificate of title in the name of
petitioner Maria Provido Gotera
and her other co-owners. (p. 3,
Rollo; Emphasis supplied)
It thus appears that the plaintiffs in Civil Case
No. 15871 were privies to G.R. No. 62042
contrary to the trial court's findings that they
were not.
G.R. No. 62042 affirmed the order of the then
Court of First Instance of Iloilo in the
reconstitution proceedings declaring TCT No.
25772 in the name of Providos over Lot No.
4517, Sta. Barbara Cadastre null and void for
being fraudulently obtained and declaring TCT
No. 106098 over the same parcel Lot No. 4517,
Sta. Barbara Cadastre in the name of petitioners
Eduardo Baranda and Alfonso Hitalia valid and
subsisting.
The decision in G.R. No. 62042 became final
and executory on March 25,1983 long before
Civil Case No. 15871 was filed.
Under these circumstances, it is crystal clear
that the Providos, private respondents herein, in
filing Civil Case No. 15871 were trying to delay
the full implementation of the final decisions in
G.R. No. 62042 as well as G.R. No. 64432
wherein this Court ordered immediate
implementation of the writs of possession and
demolition in the reconstitution proceedings
involving Lot No. 4517, Sta. Barbara Cadastre.
The purpose of a notice of lis pendens is defined
in the following manner:
Lis pendens has been
conceived to protect the real
rights of the party causing the
registration thereof With the lis
pendens duly recorded, he
could rest secure that he would
not lose the property or any part
of it. For, notice of lis pendens
serves as a warning to a
prospective purchaser or
incumbrancer that the particular
property is in litigation; and that
he should keep his hands off the
same, unless of course he
intends to gamble on the results
of the litigation. (Section 24,
Rule 14, RuIes of Court; Jamora
v. Duran, et al., 69 Phil. 3, 11; I
Martin, Rules of Court, p. 415,
footnote 3, citing cases.)
(Natanov. Esteban, 18 SCRA
481, 485-486)
The private respondents are not entitled to this
protection. The facts obtaining in this case
necessitate the application of the rule
enunciated in the cases of Victoriano v. Rovila
(55 Phil. 1000), Municipal Council of Paranaque
v. Court of First Instance of Rizal (70 Phil., 363)
and Sarmiento v. Ortiz (10 SCRA 158), to the
effect that:
We have once held that while
ordinarily a notice of pendency
which has been filed in a proper
case, cannot be cancelled while
the action is pending and
undetermined, the proper court
has the discretionary power to
cancel it under peculiar
circumstances, as for instance,
where the evidence so far
presented by the plaintiff does
not bear out the main
allegations of his complaint, and
where the continuances of the
trial, for which the plaintiff is
responsible, are unnecessarily
delaying the determination of
the case to the prejudice of the
defendant. (Victoriano v.
Rovira, supra; The Municipal
Council of Paranaque v. Court
of First Instance of Rizal, supra)
The facts of this case in relation to the earlier
cases brought all the way to the Supreme Court
illustrate how the private respondents tried to
block but unsuccessfuly the already final
decisions in G.R. No. 62042 and G.R. No.
64432.
Parenthetically, respondent Judge Tito Gustilo
abused his discretion in sustaining the
respondent Acting Register of Deeds' stand that,
the notice of lis pendens in the certificates of
titles of the petitioners over Lot No. 4571,
Barbara Cadastre cannot be cancelled on the
ground of pendency of Civil Case No. 15871
with the Court of Appeals. In upholding the
position of the Acting Register of Deeds based
on Section 77 of Presidential Decree No. 1529,
he conveniently forgot the first paragraph thereof
which provides:
Cancellation of lis pendens.
Before final judgment, a notice
of lis pendens may be cancelled
upon Order of the Court after
proper showing that the notice is
for the purpose of molesting the
adverse party, or that it is not
necessary to protect the rights
of the party who caused it to be
registered. It may also be
cancelled by the Register of
Deeds upon verified petition of
the party who caused the
registration thereof.
This Court cannot understand how respondent
Judge Gustilo could have been misled by the
respondent Acting Register of Deeds on this
matter when in fact he was the same Judge who
issued the order dismissing Civil Case No.
15871 prompting the private respondents to
appeal said order dated October 10, 1984 to the
Court of Appeals. The records of the main case
are still with the court below but based on the
order, it can be safely assumed that the various
pleadings filed by the parties subsequent to the
motion to dismiss filed by the petitioners (the
defendants therein) touched on the issue of the
validity of TCT No. 25772 in the name of the
Providos over Lot Number 4571, Sta. Barbara
Cadastre in the light of the final decisions in
G.R. No. 62042 and G.R. No. 64432.
The next question to be determined is on the
nature of the duty of the Register of Deeds to
annotate and/or cancel the notice of lis
pendens in a torrens certificate of title.
Section 10, Presidential Decree No. 1529 states
that "It shall be the duty of the Register of Deeds
to immediately register an instrument presented
for registration dealing with real or personal
property which complies with all the requisites
for registration. ... . If the instrument is not
registrable, he shall forthwith deny registration
thereof and inform the presentor of such denial
in writing, stating the ground or reasons
therefore, and advising him of his right to appeal
by consulta in accordance with Section 117 of
this Decree."
Section 117 provides that "When the Register of
Deeds is in doubt with regard to the proper step
to be taken or memoranda to be made in
pursuance of any deed, mortgage or other
instrument presented to him for registration or
where any party in interest does not agree with
the action taken by the Register of Deeds with
reference to any such instrument, the question
shall be submitted to the Commission of Land
Registration by the Register of Deeds, or by the
party in interest thru the Register of Deeds. ... ."
The elementary rule in statutory construction is
that when the words and phrases of the statute
are clear and unequivocal, their meaning must
be determined from the language employed and
the statute must be taken to mean exactly what
it says. (Aparri v. Court of Appeals, 127 SCRA
231; Insular Bank of Asia and America
Employees' Union [IBAAEU] v. Inciong, 132
SCRA 663) The statute concerning the function
of the Register of Deeds to register instruments
in a torrens certificate of title is clear and leaves
no room for construction. According to Webster's
Third International Dictionary of the English
Language the word shall means "ought to,
must, ...obligation used to express a command
or exhortation, used in laws, regulations or
directives to express what is mandatory." Hence,
the function of a Register of Deeds with
reference to the registration of deeds
encumbrances, instruments and the like is
ministerial in nature. The respondent Acting
Register of Deeds did not have any legal
standing to file a motion for reconsideration of
the respondent Judge's Order directing him to
cancel the notice of lis pendens annotated in the
certificates of titles of the petitioners over the
subject parcel of land. In case of doubt as to the
proper step to be taken in pursuance of any
deed ... or other instrument presented to him, he
should have asked the opinion of the
Commissioner of Land Registration now, the
Administrator of the National Land Title and
Deeds Registration Administration in
accordance with Section 117 of Presidential
Decree No. 1529.
In the ultimate analysis, however, the
responsibility for the delays in the full
implementation of this Court's already final
resolutions in G.R. No. 62042 and G.R. No.
64432 which includes the cancellation of the
notice of lis pendensannotated in the certificates
of titles of the petitioners over Lot No. 4517 of
the Sta. Barbara Cadastre falls on the
respondent Judge. He should never have
allowed himself to become part of dilatory
tactics, giving as excuse the wrong impression
that Civil Case No. 15871 filed by the private
respondents involves another set of parties
claiming Lot No. 4517 under their own Torrens
Certificate of Title.
WHEREFORE, the instant petition is
GRANTED. The February 12, 1987 order of the
Regional Trial Court of Iloilo, Branch 23 is
REINSTATED. All subsequent orders issued by
the trial court which annulled the February 12,
1987 order are SET ASIDE. Costs against the
private respondents.

SO ORDERED.
TEODORO ALMIROL, petitioner-appellant,
vs.
THE REGISTER OF DEEDS OF
AGUSAN, respondent-appellee.
Tranquilino O. Calo, Jr. for petitioner-appellant.
Office of the Solicitor General for respondent-
appellee.
CASTRO, J.:
On June 28, 1961 Teodoro Almirol
purchased from Arcenio Abalo a parcel of land
situated in the municipality of Esperanza,
province of Agusan, and covered by original
certificate of title P-1237 in the name of "Arcenio
Abalo, married to Nicolasa M. Abalo." Sometime
in May, 1962 Almirol went to the office of the
Register of Deeds of Agusan in Butuan City to
register the deed of sale and to secure in his
name a transfer certificate of title. Registration
was refused by the Register of Deeds upon the
following grounds, inter alia, stated in his letter
of May 21, 1962:
1. That Original Certificate of Title No.
P-1237 is registered in the name of
Arcenio Abalo, married to Nicolasa M.
Abalo, and by legal presumption, is
considered conjugal property;
2. That in the sale of a conjugal property
acquired after the effectivity of the New
Civil Code it is necessary that both
spouses sign the document; but
3. Since, as in this case, the wife has
already died when the sale was made,
the surviving husband can not dispose
of the whole property without violating
the existing law (LRC Consulta No. 46
dated June 10, 1958).
To effect the registration of the
aforesaid deed of absolute Sale, it is
necessary that the property be first
liquidated and transferred in the name of
the surviving spouse and the heirs of the
deceased wife by means of extrajudicial
settlement or partition and that the
consent of such other heir or heirs must
be procured by means of another
document ratifying this sale executed by
their father.
In view of such refusal, Almirol went to the
Court of First Instance of Agusan on a petition
for mandamus (sp. civ. case 151), to compel the
Register of Deeds to register the deed of sale
and to issue to him the corresponding transfer
certificate of title, and to recover P5,000 in moral
damages and P1,000 attorney's fees and
expenses of litigation. It is Almirol's assertion
that it is but a ministerial duty of the respondent
to perform the acts required of him, and that he
(Almirol) has no other plain, speedy and
adequate remedy in the ordinary course of law.
In his answer with counterclaim for
P10,000 damages, the respondent reiterated the
grounds stated in his letter of May 21, 1962,
averred that the petitioner has "other legal, plain,
speedy and adequate remedy at law by
appealing the decision of the respondent to the
Honorable Commissioner of Land Registration,"
and prayed for dismissal of the petition.
In its resolution of October 16, 1963 the
lower court, declaring that "mandamus does not
lie . . . because the adequate remedy is that
provided by Section 4 of Rep. Act 1151",
dismissed the petition, with costs against the
petitioner.
Hence the present appeal by Almirol.
The only question of law tendered for
resolution is whether mandamus will lie to
compel the respondent to register the deed of
sale in question.
Although the reasons relied upon by the
respondent evince a sincere desire on his part to
maintain inviolate the law on succession and
transmission of rights over real properties, these
do not constitute legal grounds for his refusal to
register the deed. Whether a document is valid
or not, is not for the register of deeds to
determine; this function belongs properly to a
court of competent jurisdiction. 1
Whether the document is invalid,
frivolous or intended to harass, is not
the duty of a Register of Deeds to
decide, but a court of competent
jurisdiction. (Gabriel vs. Register of
Deeds of Rizal, et al., L-17956, Sept.
30, 1953).
. . . the supposed invalidity of the
contracts of lease is no valid objection to
their registration, because invalidity is
no proof of their non-existence or a valid
excuse for denying their registration.
The law on registration does not require
that only valid instruments shall be
registered. How can parties affected
thereby be supposed to know their
invalidity before they become aware,
actually or constructively, of their
existence or of their provisions? If the
 purpose of registration is merely to give The foregoing notwithstanding, the court a
notice, then questions regarding the quo correctly dismissed the petition
effect or invalidity of instruments are for mandamus. Section 4 abovequoted provides
expected to be decided after, not before, that "where any party in interest does not agree
registration. It must follow as a with the Register of Deeds . . . the question shall
necessary consequence that registration be submitted to the Commissioner of Land
must first be allowed, and validity or Registration," who thereafter shall "enter an
effect litigated afterwards. (Gurbax order prescribing the step to be taken or
Singh Pablo & Co. vs. Reyes and memorandum to be made," which shall be
Tantoco, 92 Phil. 182-183). "conclusive and binding upon all Registers of
Deeds." This administrative remedy must be
Indeed, a register of deeds is entirely resorted to by the petitioner before he can have
precluded by section 4 of Republic Act 1151 recourse to the courts.
from exercising his personal judgment and
discretion when confronted with the problem of ACCORDINGLY, the Resolution of the
whether to register a deed or instrument on the lower court of October 16, 1969, is affirmed, at
ground that it is invalid. For under the said petitioner's cost.1wph1.t
section, when he is in doubt as to the proper
step to be taken with respect to any deed or
other instrument presented to him for
registration, all that he is supposed to do is to
submit and certify the question to the
Commissioner of Land Registration who shall,
after notice and hearing, enter an order
prescribing the step to be taken on the doubtful
question. Section 4 of R.A. 1151 reads as
follows:

Reference of doubtful matters to

Commissioner of Land Registration.
When the Register of Deeds is in doubt
with regard to the proper step to be
taken or memorandum to be made in
pursuance of any deed, mortgage, or
other instrument presented to him for
registration, or where any party in
interest does not agree with the Register
of Deeds with reference to any such
matter, the question shall be submitted
to the Commissioner of Land
Registration either upon the certification
of the Register of Deeds, stating the
question upon which he is in doubt, or
upon the suggestion in writing by the
party in interest; and thereupon the
Commissioner, after consideration of the
matter shown by the records certified to
him, and in case of registered lands,
after notice to the parties and hearing,
shall enter an order prescribing the step
to be taken or memorandum to be
made. His decision in such cases shall
be conclusive and binding upon all
Registers of Deeds: Provided, further,
That when a party in interest disagrees
with the ruling or resolution of the
Commissioner and the issue involves a
question of law, said decision may be
appealed to the Supreme Court within
thirty days from and after receipt of the
notice thereof.
 JOSEFINA V.
NOBLEZA, Petitioner, v. SHIRLEY B.
NUEGA, Respondent.
DECISION
VILLARAMA, JR., J.:
At bar is a petition for review on certiorari of the
Decision1 dated May 14, 2010 and the
Resolution2dated July 21, 2010 of the Court of
Appeals (CA) in CA-G.R. CV No. 70235, which
affirmed with modification the assailed
Decision3 dated February 14, 2001 of the
Regional Trial Court (RTC) of Marikina City,
Branch 273, in Civil Case No. 96-274-MK.
The following facts are found by the trial court
and affirmed by the appellate court:
Respondent Shirley B. Nuega (Shirley) was
married to Rogelio A. Nuega (Rogelio) on
September 1, 1990. 4 Sometime in 1988 when
the parties were still engaged, Shirley was
working as a domestic helper in Israel. Upon the
request of Rogelio, Shirley sent him money 5 for
the purchase of a residential lot in Marikina
where they had planned to eventually build their
home. Rogelio was then also working abroad as
a seaman. The following year, or on September
13, 1989, Rogelio purchased the subject house
and lot for One Hundred Two Thousand Pesos
(P102,000.00)6 from Rodeanna Realty
Corporation. The subject property has an
aggregate area of one hundred eleven square
meters (111 sq. m.) covered by Transfer
Certificate of Title (TCT) No. N-133844. 7 Shirley
claims that upon her arrival in the Philippines
sometime in 1989, she settled the balance for
the equity over the subject property with the
developer through SSS 8 financing. She likewise
paid for the succeeding monthly amortizations.
On October 19, 1989, TCT No. 1719639 over the
subject property was issued by the Registry of
Deeds of Marikina, Rizal solely under the name
of Rogelio.
On September 1, 1990, Shirley and Rogelio got
married and lived in the subject property. The
following year, Shirley returned to Israel for
work. While overseas, she received information
that Rogelio had brought home another woman,
Monica Escobar, into the family home. She also
learned, and was able to confirm upon her return
to the Philippines in May 1992, that Rogelio had
been introducing Escobar as his wife.
In June 1992, Shirley filed two cases against
Rogelio: one for Concubinage before the
Provincial Prosecution Office of Rizal, and
another for Legal Separation and Liquidation of
Property before the RTC of Pasig City. Shirley
later withdrew the complaint for legal separation
and liquidation of property, but re-filed10 the
same on January 29, 1993. In between the filing
of these cases, Shirley learned that Rogelio had
the intention of selling the subject property.
Shirley then advised the interested buyers - one
of whom was their neighbor and petitioner
Josefina V. Nobleza (petitioner) - of the
existence of the cases that she had filed against
Rogelio and cautioned them against buying the
subject property until the cases are closed and
terminated. Nonetheless, under a Deed of
Absolute Sale11 dated December 29, 1992,
Rogelio sold the subject property to petitioner
without Shirley's consent in the amount of Three
Hundred Eighty Thousand Pesos (P380,000.00),
including petitioner's undertaking to assume the
existing mortgage on the property with the
National Home Mortgage Finance Corporation
and to pay the real property taxes due thereon.
Meanwhile, in a Decision12 dated May 16, 1994,
the RTC of Pasig City, Branch 70, granted the
petition for legal separation and ordered the
dissolution and liquidation of the regime of
absolute community of property between Shirley
and Rogelio, viz.:chanroblesvirtuallawlibrary
WHEREFORE, in view of the foregoing, the
Court hereby grants the instant petition for legal
separation between the subject spouses with all
its legal effects as provided for in Art. 63 of the
Family Code. Their community property is
consequently dissolved and must be liquidated
in accordance with Art. 102 of the New Family
Code. The respondent is thus hereby enjoined
from selling, encumbering or in any way
disposing or alienating any of their community
property including the subject house and lot
before the required liquidation. Moreover, he,
being the guilty spouse, must forfeit the net
profits of the community property in favor of the
petitioner who is the innocent spouse pursuant
to Art. 43 of the aforesaid law. Finally, in the light
of the claim of ownership by the present
occupants who have not been impleaded in the
instant case, a separate action must be
instituted by the petitioner against the alleged
buyer or buyers thereof to determine their
respective rights thereon.
Let a copy of this decision be furnished the
Local Civil Registrar of Manila, the Register of
Deeds of Marikina, Metro Manila and the
National Statistics Office (NSO), sta. Mesa,
Manila.
SO ORDERED. 13cralawlawlibrary
Rogelio appealed the above-quoted ruling
before the CA which denied due course and
dismissed the petition. It became final and
executory and a writ of execution was issued in
August 1995. 14
On August 27, 1996, Shirley instituted a
Complaint 15 for Rescission of Sale and Recoveiy
of Property against petitioner and Rogelio before
the RTC of Marikina City, Branch 273. After trial
on the merits, the trial court rendered its
decision on February 14,
2001, viz.:chanroblesvirtuallawlibrary
WHEREFORE, foregoing premises considered,
judgment is hereby rendered in favor of plaintiff
Shirley Nuega and against defendant Josefina
Nobleza, as follows:
1) the Deed of Absolute Sale dated December
29, 1992 insofar as the 55.05 square meters
representing the one half (1/2) portion of
plaintiff Shirley Nuega is concerned, is hereby
ordered rescinded, the same being null and
void;
2) defendant Josefina Nobleza is ordered to
reconvey said 55.05 square meters to plaintiff
Shirley Nuega, or in the alternative to pay
plaintiff Shirley Nuega the present market
value of said 55.05 square meters; and
3) to pay plaintiff Shirley Nuega attorney's fees
in the sum of Twenty Thousand Pesos
(P20,000.00).
For lack of merit, defendant's counterclaim is
hereby DENIED.
SO ORDERED. 16
Petitioner sought recourse with the CA, while
Rogelio did not appeal the ruling of the trial
court. In its assailed Decision promulgated on
May 14, 2010, the appellate court affirmed with
modification the trial court's
ruling, viz.:chanroblesvirtuallawlibrary
WHEREFORE, subject to the foregoing
disquisition, the appeal is DENIED. The
Decision dated 14 February 2001 of the
Regional Trial Court of Marikina City, Branch
273 in Civil Case No. 96-274-
MK is AFFIRMED with MODIFICATION in that
the Deed of Absolute Sale dated 29 December
1992 is hereby declared null and void in its
entirety, and defendant-appellant Josefina V.
Nobleza is ordered to reconvey the entire
subject property to plaintiff-appellee Shirley B.
Nuega and defendant Rogelio Nuega, without
prejudice to said defendant-appellant's right to
recover from defendant Rogelio whatever
amount she paid for the subject property. Costs
against defendant-appellant Nobleza.
SO ORDERED. 17cralawlawlibrary
Petitioner moved for reconsideration. In a
Resolution dated July 21, 2010, the appellate
court denied the motion for lack of merit. Hence,
this petition raising the following assignment of
errors:chanroblesvirtuallawlibrary
[I.] THE HONORABLE COURT OF APPEALS
ERRED WHEN IT AFFIRMED THE
DECISION OF THE REGIONAL TRIAL
COURT BY SUSTAINING THE FINDING
THAT PETITIONER WAS NOT A
PURCHASER IN GOOD FAITH.
[II.] THE HONORABLE COURT OF APPEALS
ERRED WHEN IT MODIFIED THE
DECISION OF THE REGIONAL TRIAL
COURT BY DECLARING AS NULL AND
VOID THE DEED OF ABSOLUTE SALE
DATED 29 DECEMBER 1992 IN ITS
ENTIRETY. 18
We deny the petition.
Petitioner is not a buyer in good faith.
An innocent purchaser for value is one who buys
the property of another, without notice that some
other person has a right or interest in the
property, for which a full and fair price is paid by
the buyer at the time of the purchase or before
receipt of any notice of claims or interest of
some other person in the property. 19 It is the
party who claims to be an innocent purchaser for
value who has the burden of proving such
assertion, and it is not enough to invoke the
ordinary presumption of good faith.20 To
successfully invoke and be considered as a
buyer in good faith, the presumption is that first
and foremost, the "buyer in good faith" must
have shown prudence and due diligence in the
exercise of his/her rights. It presupposes that the
buyer did everything that an ordinary person
would do for the protection and defense of
his/her rights and interests against prejudicial or
injurious concerns when placed in such a
situation. The prudence required of a buyer in
good faith is "not that of a person with training in
law, but rather that of an average man who
'weighs facts and circumstances without
resorting to the calibration of our technical rules
of evidence of which his knowledge is nil.'" 21 A
buyer in good faith does his homework and
verifies that the particulars are in order such as
the title, the parties, the mode of transfer and the
provisions in the deed/contract of sale, to name
a few. To be more specific, such prudence can
be shown by making an ocular inspection of the
property, checking the title/ownership with the
proper Register of Deeds alongside the payment
of taxes therefor, or inquiring into the minutiae
such as the parameters or lot area, the type of
ownership, and the capacity of the seller to
dispose of the property, which capacity
necessarily includes an inquiry into the civil
status of the seller to ensure that if married,
marital consent is secured when necessary. In
fine, for a purchaser of a property in the
possession of another to be in good faith, he
must exercise due diligence, conduct an
investigation, and weigh the surrounding facts
and circumstances like what any prudent man in
a similar situation would do. 22
In the case at bar, petitioner claims that she is a
buyer in good faith of the subject property which
is titled under the name of the seller Rogelio A.
Nuega alone as evidenced by TCT No. 171963
and Tax Declaration Nos. D-012-04723 and D-
012-04724. 23 Petitioner argues, among others,
that since she has examined the TCT over the
subject property and found the property to have
been registered under the name of seller
Rogelio alone, she is an innocent purchaser for
value and "she is not required to go beyond the
face of the title in verifying the status of the
subject property at the time of the
consummation of the sale and at the date of the
sale." 24
We disagree with petitioner.
A buyer cannot claim to be an innocent
purchaser for value by merely relying on the
TCT of the seller while ignoring all the other
surrounding circumstances relevant to the sale.
In the case of Spouses Raymundo v. Spouses
Bandong, 25 petitioners therein - as does
petitioner herein - were also harping that due to
the indefeasibility of a Torrens title, there was
nothing in the TCT of the property in litigation
that should have aroused the buyer's suspicion
as to put her on guard that there was a defect in
the title of therein seller. The Court held in
the Spouses Raymundo case that the buyer
therein could not hide behind the cloak of being
an innocent purchaser for value by merely
relying on the TCT which showed that the
registered owner of the land purchased is the
seller. The Court ruled in this case that the buyer
was not an innocent purchaser for value due to
the following attendant
circumstances, viz.:chanroblesvirtuallawlibrary
In the present case, we are not convinced by the
petitioners' incessant assertion that Jocelyn is
an innocent purchaser for value. To begin with,
she is a grandniece of Eulalia and resides in the
same locality where the latter lives and conducts
her principal business. It is therefore impossible
for her not to acquire knowledge of her grand
aunt's business practice of requiring
her biyaheros to surrender the titles to their
properties and to sign the corresponding deeds
of sale over said properties in her favor, as
security. This alone should have put Jocelyn on
guard for any possible abuses that Eulalia may
commit with the titles and the deeds of sale in
her possession. 26cralawlawlibrary
Similarly, in the case of Arrofo v. Quio, 27 the
Court held that while "the law does not require a
person dealing with registered land to inquire
further than what the Torrens Title on its face
indicates," the rule is not absolute. 28 Thus,
finding that the buyer therein failed to take the
necessary precaution required of a prudent man,
the Court held that Arrofo was not an innocent
purchaser for
value, viz.:chanroblesvirtuallawlibrary
In the present case, the records show that
Arrofo failed to act as a prudent buyer. True, she
asked her daughter to verify from the Register of
Deeds if the title to the Property is free from
encumbrances. However, Arrofo admitted that
the Property is within the neighborhood and that
she conducted an ocular inspection of the
Property. She saw the house constructed on the
Property. Yet, Arrofo did not even bother to
inquire about the occupants of the house. Arrofo
also admitted that at the time of the sale, Myrna
was occupying a room in her house as her
lessee. The fact that Myrna was renting a room
from Arrofo yet selling a land with a house
should have put Arrofo on her guard. She knew
that Myrna was not occupying the house.
Hence, someone else must have been
occupying the house.
Thus, Arrofo should have inquired who occupied
the house, and if a lessee, who received the
rentals from such lessee. Such inquiry would
have led Arrofo to discover that the lessee was
paying rentals to Quino, not to Renato and
Myrna, who claimed to own the
Property. 29cralawlawlibrary
An analogous situation obtains in the case at
bar.
The TCT of the subject property states that its
sole owner is the seller Rogelio himself who was
therein also described as "single". However, as
in the cases of Spouses Raymundo and Arrofo,
there are circumstances critical to the case at
bar which convince us to affirm the ruling of both
the appellate and lower courts that herein
petitioner is not a buyer in good faith.
First, petitioner's sister Hilda Bautista, at the
time of the sale, was residing near Rogelio and
Shirley's house - the subject property - in
Ladislao Diwa Village, Marikina City. Had
petitioner been more prudent as a buyer, she
could have easily checked if Rogelio had the
capacity to dispose of the subject property. Had
petitioner been more vigilant, she could have
inquired with such facility - considering that her
sister lived in the same Ladislao Diwa Village
where the property is located - if there was any
person other than Rogelio who had any right or
interest in the subject property.
To be sure, respondent even testified that she
had warned their neighbors at Ladislao Diwa
Village - including petitioner's sister - not to
engage in any deal with Rogelio relative to the
purchase of the subject property because of the
cases she had filed against Rogelio. Petitioner
denies that respondent had given such warning
to her neighbors, which includes her sister,
therefore arguing that such warning could not be
construed as "notice" on her part that there is a
person other than the seller himself who has any
right or interest in the subject property.
Nonetheless, despite petitioner's adamant
denial, both courts a quo gave probative value to
the testimony of respondent, and the instant
petition failed to present any convincing
evidence for this Court to reverse such factual
finding. To be sure, it is not within our province
to second-guess the courts a quo, and the re-
determination of this factual issue is beyond the
reach of a petition for review on certiorari where
only questions of law may be reviewed. 30
Second, issues surrounding the execution of the
Deed of Absolute Sale also pose question on
the claim of petitioner that she is a buyer in good
faith. As correctly observed by both courts a
quo, the Deed of Absolute Sale was executed
and dated on December 29, 1992. However, the
Community Tax Certificates of the witnesses
therein were dated January 2 and 20,
1993. 31 While this irregularity is not a direct proof
of the intent of the parties to the sale to make it
appear that the Deed of Absolute Sale was
executed on December 29, 1992 - or before
Shirley filed the petition for legal separation on
January 29, 1993 - it is circumstantial and
relevant to the claim of herein petitioner as an
innocent purchaser for value.
That is not all.
In the Deed of Absolute Sale dated December
29, 1992, the civil status of Rogelio as seller was
not stated, while petitioner as buyer was
indicated as
"single," viz.:chanroblesvirtuallawlibrary
ROGELIO A. NUEGA, of legal age, Filipino
citizen and with postal address at 2-A-2 Ladislao
Diwa St., Concepcion, Marikina, Metro Manila,
hereinafter referred to as the VENDOR
And
JOSEFINA V. NOBLEZA, of legal age, Filipino
citizen, single and with postal address at No. L-
2-A-3 Ladislao Diwa St., Concepcion, Marikina,
Metro Manila, hereinafter referred to as the
VENDEE. 32cralawlawlibrary
It puzzles the Court that while petitioner has
repeatedly claimed that Rogelio is "single" under
TCT No. 171963 and Tax Declaration Nos. D-
012-04723 and D-012-04724, his civil status as
seller was not stated in the Deed of Absolute
Sale - further creating a cloud on the claim of
petitioner that she is an innocent purchaser for
value.
As to the second issue, we rule that the
appellate court did not err when it modified the
decision of the trial court and declared that the
Deed of Absolute Sale dated December 29,
1992 is void in its entirety.
The trial court held that while the TCT shows
that the owner of the subject property is Rogelio
alone, respondent was able to prove at the trial
court that she contributed in the payment of the
purchase price of the subject property. This fact
was also settled with finality by the RTC of Pasig
City, Branch 70, and affirmed by the CA, in the
case for legal separation and liquidation of
property docketed as JDRC Case No. 2510. The
pertinent portion of the decision
reads:chanroblesvirt uallawlibrary
xxx Clearly, the house and lot jointly acquired by
the parties prior to their marriage forms part of
their community property regime, xxx
From the foregoing, Shirley sufficiently proved
her financial contribution for the purchase of the
house and lot covered by TCT 171963. Thus,
the present lot which forms part of their
community property should be divided equally
between them upon the grant of the instant
petition for legal separation. Having established
by preponderance of evidence the fact of her
husband's guilt in contracting a subsequent
marriage xxx, Shirley alone should be entitled to
the net profits earned by the absolute
community property. 33cralawlawlibrary
However, the nullity of the sale made by Rogelio
is not premised on proof of respondent's
financial contribution in the purchase of the
subject property. Actual contribution is not
relevant in determining whether a piece of
property is community property for the law itself
defines what constitutes community property.
Article 91 of the Family Code thus
provides:chanrobles virt uallawlibrary
Art. 91. Unless otherwise provided in this
Chapter or in the marriage settlements, the
community property shall consist of all the
property owned by the spouses at the time of
the celebration of the marriage or acquired
thereafter.
The only exceptions from the above rule are: (1)
those excluded from the absolute community by
the Family Code; and (2) those excluded by the
marriage settlement.
Under the first exception are properties
enumerated in Article 92 of the Family Code,
which states:chanroblesvirtuallawlibrary
Art. 92. The following shall be excluded from the
community property:
(1) Property acquired during the marriage by
gratuitous title by either spouse, and the fruits as
well as the income thereof, if any, unless it is
expressly provided by the donor, testator or
grantor that they shall form part of the
community property;
(2) Property for personal and exclusive use of
either spouse; however, jewelry shall form part
of the community property;
(3) Property acquired before the marriage by
either spouse who has legitimate descendants
by a former marriage, and the fruits as well as
the income, if any, of such property.
As held in Quiao v.
Quiao:34ChanRoblesVirtualawlibrary
When a couple enters into a regime of absolute
community, the husband and the wife becomes
joint owners of all the properties of the marriage.
Whatever property each spouse brings into the
marriage, and those acquired during the
marriage (except those excluded under Article
92 of the Family Code) form the common mass
of the couple's properties. And when the
couple's marriage or community is dissolved,
that common mass is divided between the
spouses, or their respective heirs, equally or in
the proportion the parties have established,
irrespective of the value each one may have
originally owned.
Since the subject property does not fall under
any of the exclusions provided in Article 92, it
therefore forms part of the absolute community
property of Shirley and Rogelio. Regardless of
their respective contribution to its acquisition
before their marriage, and despite the fact that
only Rogelio's name appears in the TCT as
owner, the property is owned jointly by the
spouses Shirley and Rogelio.
Respondent and Rogelio were married on
September 1, 1990. Rogelio, on his own and
without the consent of herein respondent as his
spouse, sold the subject property via a Deed of
Absolute Sale dated December 29, 1992 - or
during the subsistence of a valid contract of
marriage. Under Article 96 of Executive Order
No. 209, otherwise known as The Family Code
of the Philippines, the said disposition of a
communal property is
void, viz.:chanroblesvirtuallawlibrary
Art. 96. The administration and enjoyment of the
community property shall belong to both
spouses jointly. In case of disagreement, the
husband's decision shall prevail, subject to
recourse to the court by the wife for a proper
remedy, which must be availed of within five
years from the date of the contract implementing
such decision.
In the event that one spouse is incapacitated or
otherwise unable to participate in the
administration of the common properties, the
other spouse may assume sole powers of
administration. These powers do not include
the powers of disposition or encumbrance
without the authority of the court or the
written consent of the other spouse. In the
absence of such authority or consent, the
disposition or encumbrance shall be
void. However, the transaction shall be
construed as a continuing offer on the part of the
consenting spouse and the third person, and
may be perfected as a binding contract upon the
acceptance by the other spouse or authorization
by the court before the offer is withdrawn by
either or both offerors. 35cralawlawlibrary
It is clear under the foregoing provision of
the Family Code that Rogelio could not sell the
subject property without the written consent of
respondent or the authority of the court. Without
such consent or authority, the entire sale is void.
As correctly explained by the appellate
court:chanroblesvirtuallawlibrary
In the instant case, defendant Rogelio sold the
entire subject property to defendant-appellant
Josefina on 29 December 1992 or during the
existence of Rogelio's marriage to plaintiff-
appellee Shirley, without the consent of the
latter. The subject property forms part of Rogelio
and Shirley's absolute community of property.
Thus, the trial court erred in declaring the deed
of sale null and void only insofar as the 55.05
square meters representing the one-half (1/2)
portion of plaintiff-appellee Shirley. In absolute
community of property, if the husband, without
knowledge and consent of the wife, sells (their)
property, such sale is void. The consent of both
the husband Rogelio and the wife Shirley is
required and the absence of the consent of one
renders the entire sale null and void including
the portion of the subject property pertaining to
defendant Rogelio who contracted the sale with
defendant-appellant Josefina. Since the Deed of
Absolute Sale x x x entered into by and between
defendant-appellant Josefina and defendant
Rogelio dated 29 December 1992, during the
subsisting marriage between plaintiff-appellee
Shirley and Rogelio, was without the written
consent of Shirley, the said Deed of Absolute
Sale is void in its entirety. Hence, the trial court
erred in declaring the said Deed of Absolute
Sale as void only insofar as the 1/2 portion
pertaining to the share of Shirley is
concerned. 36cralawlawlibrary

Finally, consistent with our ruling that Rogelio

solely entered into the contract of sale with
petitioner and acknowledged receiving the entire
consideration of the contract under the Deed of
Absolute Sale, Shirley could not be held
accountable to petitioner for the reimbursement
of her payment for the purchase of the subject
property. Under Article 94 of the Family Code,
the absolute community of property shall only be
"liable for x x x [d]ebts and obligations
contracted by either spouse without the consent
of the other to the extent that the family may
have been benefited x x x." As correctly stated
by the appellate court, there being no evidence
on record that the amount received by Rogelio
redounded to the benefit of the family,
respondent cannot be made to reimburse any
amount to petitioner. 37

WHEREFORE, in view of the foregoing, the

petition is DENIED. The assailed Decision and
Resolution of the Court of Appeals dated May
14, 2010 and July 21, 2010, respectively, in CA-
G.R. CV No. 70235 are AFFIRMED.

Costs against petitioner.