Hector Uy vs.

Virginia Fule
G.R. NO. 164961 (2014)
BUYER IN GOOD FAITH
DOCTRINES: Generally, a buyer is not required to inquire beyond the title if the requisites of good faith concur. However, absent one or Commented [KG1]: ll part headings (doctrines, facts,
two of the requisites, then the law itself puts the buyer on notice and obliges the latter to exercise a higher degree of diligence by issues [procedural or substantive] and held), click on
scrutinizing the certificate of title and examining all factual circumstances in order to determine the seller’s title and capacity to transfer “Normal” then “Emphasis”
any interest in the property.
FACTS: Conrado Garcia (CG) owned a vast tract of land. Upon his death, his heirs entered an extrajudicial settlement of his estate including
the land and thereafter caused its registration under their names. Meanwhile, DAR officials issued a joint certification that said land was an
“untitled” property owned by CG. As such, it was then included in the Operation Land Transfer program pursuant to PD No. 27. The offices
issued Emancipation Patents and Original Certificate of Titles to farmer-beneficiaries like Mariano Ronda (MR). MR sold his portion to
Chisan Uy then Chisan Uy’s heirs, sold the said land to Hector Uy. In 1997, the TCT of CG was cancelled and subsequently issued in the
names of the heirs of Garcia under a new TCT. In 1998, DAR Secretary issued the EPs to farmer-beneficiaries like MR. However, CG’s TCT
was already in the name of Hector Uy. Because of this, the heirs of CG filed a complaint assailing the certificates of titles issued to
purchasers Chisan and Hector Uy. RTC favored respondents. CA affirmed. SC affirmed CA.
SUBSTANTIVE ISSUE: WON Hector Uy, who got the land from the heirs of the farmer beneficiary Mariano Ronda, was an innocent purchaser for
value who had better rights than the heirs of Conrado Garcia over the disputed land. (NO. He did not exercise reasonable precaution by inquiring
beyond the title. Third requisite was absent. Hence, he cannot be awarded the disputed land.)

RATIO:
There is good faith when the following conditions concur:
(1) the seller is the registered owner of the land;
(2) the latter is in possession thereof; and
(3) at the time of the sale, the buyer was not aware of any claim or interest of some other person in the property, or of any defect
or restriction in the title of the seller or in his capacity to convey title to the property.

Absent one or two of the foregoing conditions, then the law itself puts the buyer on notice and obliges the latter to exercise a higher
degree of diligence by scrutinizing the certificate of title and examining all factual circumstances in order to determine the seller’s title and
capacity to transfer any interest in the property. Under such circumstance, it was no longer sufficient for said buyer to merely show that he
had relied on the face of the title; he must now also show that he had exercised reasonable precaution by inquiring beyond the title. Failure
to exercise such degree of precaution makes him a buyer in bad faith.
In this case, the deed of sale executed between the heirs of Ronda and the petitioner were issued only on August 17, 1998 but the
deed of sale was executed on July 31, 1998. Evidently, the petitioner entered into the deed of sale without having been able to inspect the
TCTs since they were still inexistent. His only basis were the OCTs and such categorically stated that they were entered pursuant to an
emancipation patent pursuant to Operation Land Transfer. It provided that it shall not be transferred except by hereditary succession or to
the government. Hence, the third element was negated. At the time of the sale, the buyer was already aware of any restriction in the title
of the seller or in his capacity to convey title to the property. The absence of the third condition put the petitioner on notice and obliged
him to exercise a higher degree of diligence by scrutinizing the certificates of title and examining all factual circumstances in order to
determine the seller’s title and capacity to transfer any interest in the lots.
 Tagaytay Realty Co. Inc. vs. Gacutan
G.R. NO. 160033 (2015)
LACHES
DOCTRINES: Laches is the failure of or neglect for an unreasonable and unexplained length of time to do that which by exercising due Commented [KG2]: All part headings (doctrines, facts,
diligence could or should have been done earlier, or to assert a right within a reasonable time. It warrants a presumption that the party issues [procedural or substantive] and held), click on
entitled thereto has either abandoned it or declined to assert it. “Normal” then “Emphasis”

FACTS: Respondent Gacutan entered into a contract to sell with Tagaytay Realty for the purchase or installment of a residential lot in
Foggy Heights Subdivision. Petitioner Tagaytay Realty executed an express undertaking to complete the roads and amenities such as the
pool, courts, and playground within 2 years and on the understanding that failure on their part to complete within stipulated time, Gacutan
shall suspend payment monthly without incurring penalty interest. It was also provided that if there was force majeure, etc., it shall
suspend the running of the 2 year period and shall resume upon cessation of the cause of stoppage or suspension of said development. In
1979, Gacutan notified Tagaytay Realty that he was suspending payment because the amenities had not been constructed. Despite such,
Tagaytay did not reply and instead sent a statement of account demanding balance of the price, interests and penalty. Gacutan refused to
pay the penalty and filed a complaint for specific performance. HLURB Arbiter favored respondent. HLURB Board affirmed arbiter. OP
upheld HLURB Board. MR denied. CA Affirmed OP. MR denied. Hence, petition to SC.
SUBSTANTIVE ISSUE: WON respondent’s claim was barred by laches. (NO. The claim of respondent was not barred by laches.)
RATIO:
Laches is the failure of or neglect for an unreasonable and unexplained length of time to do that which by exercising due diligence could or
should have been done earlier, or to assert a right within a reasonable time. It warrants a presumption that the party entitled thereto has
either abandoned it or declined to assert it.
The CA correctly declared that laches did not set in to bar the claim of the respondent because he had made periodic written demands
upon the petitioner that indicated that he had not abandoned or declined to assert the claim. In 1979, he manifested the intention to avail
himself of his right to suspend the payment of his amortizations pursuant to the undertaking. Since then until 1984, he had continuously
requested the petitioner for updates on the progress of the construction of the amenities so that he could resume his amortizations. The
petitioner did not respond to his requests. His efforts to have the petitioner construct the amenities so that he would already pay for the
lot demonstrated his prudence and alacrity in insisting on his rights, negating any hint of bad faith or of lack of diligence on his part.