2G SALES

Banzon v Cruz G.R. NO. L-31789     

DATE: June 29, 1972
PONENTE: TEEHANKEE, J.
DOCTRINE
FACTS
Sta. Maria obtained crop loans from PNB. Respondent Associated Insurance & Surety Co., Inc.
(Associated) acted as surety of Sta. Maria, filing surety bonds in favor of the bank to answer for
prompt repayment of the loans. Petitioner Banzon and Emilio Ma. Naval in turn acted as
indemnitors of Associated and were obligated to indemnify and hold harmless Associated from
any liability thus acting as surety of the loan. Sta. Maria failed to pay his obligations to the bank,
which accordingly demanded payment from Associated as surety. However, instead of paying the
loan, Associated filed a complaint with RTC of Manila against debtor Sta. Maria and indemnitors
Banzon and Naval alleging the outstanding obligations of Sta. Maria with the bank. The said court
ordered Sta. Maria, Banzon and Naval "to pay jointly and severally unto plaintiff for the benefit of
the PNB" the amounts.

Associated then levied 2 lots in Caloocan to satisfy the judgment. As it was the highest bidder at
the execution sale conducted by the Sheriff of Rizal, the latter issued a certificate of sale in favor
of the former. Associated then demanded from Banzon the delivery of the latter’s own duplicate
of certificate of title, to which Banzon refused, prompting Associated to file a complaint with the
CFI of Rizal for an order directing Banzon to present said certificate for cancellation of his
owner’s duplicates of title and for another order directing the Register of Deeds of Rizal to cancel
the certificate and to issue new transfer certificates in the name of Associated. The RTC ruled in
favor of the Associated.

This Court affirmed the decision of the RTC, relying upon the lower court's findings on Banzon's
failure to substantiate his claims which "would amount to a deprivation of (Banzon's) property
without due process of law" had he but discharged his burden of proof.

It was found however that notwithstanding the judgment obtained from the RTC of Manila by
Associated and executed by it against Banzon as indemnitor " for the benefit of the PNB," and
which judgment it obtained and executed on the representation to the said court that the bank
was exacting payment from it as surety of the debtor Sta. Maria's loans, and that it was therefore
enforcing Banzon's undertaking as indemnitor in turn to indemnify it, that it never discharged its
liability as surety to the bank nor ever made any payment to the bank, whether in money or
property, to discharge Sta. Maria's outstanding obligations as guaranteed by it.

PNB then filed a complaint against Sta. Maria, his 6 brothers and sisters, and Associated. After
the RTC ruled in favor of PNB, Sta. Maria began paying his outstanding loan, which then
amounted to only ½ of the amount earlier awarded to Associated to be paid to PNB. In other
words, PNB collected directly from its debtor Sta. maria the amounts owing to it, with Associated
never having to put in one centavo. After collecting from Sta. Maria, PNB released Associated
from its obligation as surety. This should have put an end to the matter and Banzon’s 2 lots
therefore stored fully to his ownership, but it was then discovered that Associated has allowed
and permitted one Pedro Cardenas to execute and levy one of Banzon’s 2 parcel of land being
held by Associated as trustee, which then resulted to the issuance of a new title in the name of
Cardenas.

Having learned of PNB’s release of Associated, the Banzons filed a complaint for reconveyance
of their 2 parcels of land, one of which is under Cardenas’ name and the other, while still under
Banzon’s name, was held by Associated.
ISSUE/S
W/N petitioner has the right to ask for the reconveyance of the 2 lots in question. -YES
RULING
When Associated nevertheless prematurely and contary to the intent and condition of the basic
1957 judgment levied in execution on the 2 Caloocan City lots of Banzon the interest it acquired
was clearly impressed with a trust character. Such acquisition of Banzon's properties by
Associated was effected, if not through fraud (a) on Associated's part, certainly
through mistake (b) and there Associated was "by force of law, considered a trustee of implied
trust for the benefit of the person from whom the property comes" by virtue of Art 1456 of the
Code (c) — since Associated not having paid nor having been compelled to pay the bank had no
right in law or equity to so execute the judgment against Banzon as indemnitor. Had there been
no fraudulent concealment or suppression of the fact of such non-payment by Associated or a
mistaken notion just assumed without factual basis that Associated had paid the bank and was
thus entitled to enforce its judgement against Banzon as indemnitor, the writ for execution of the
judgment against Banzon's properties would not been issued. Associated therefore stands legally
bound by force of law to now discharge its implied trust and return Banzon’s properties to him as
their true and rightful owner.

[OTADOY, MARY CHRIS]

2G SALES ACTUALDELIVERY
EDCA PUBLISHING VS. THE SPOUSES SANTOS 184 G.R. No.80298
SCRA 614
DATE: April 26, 1990
PONENTE: CRUZ, J.:
DOCTRINE: Ownership in the thing sold shall not pass to the
buyer until full payment of the purchase price only if there is a
stipulation to that effect. Otherwise, the rule is that such
ownership shall pass from the vendor to the vendee upon the
actual or constructive delivery of the thing sold even if the
purchase price has
not yet been paid.

FACTS
A person identifying himself as Professor Jose Cruz placed an order by telephone with the
petitioner EDCA Publishing for 406 books, payable on delivery. EDCA delivered the books, for
which Cruz issued a personal check covering the purchase price of P8,995.65. Cruz then sold
120 of the books to respondent Leonor Santos who paid him P1,700.00. Meanwhile, EDCA
became suspicious of Cruz and through their investigation, it was revealed that Cruz was not
employed at De la Salle College where he had claimed to be a dean, and that he had no more
account or deposit with the Philippine Amanah Bank, against which he had drawn the payment
check. EDCA then went to the police, which set a trap and arrested Cruz. Investigation
disclosed his real name as Tomas de la Peña, and that he sold 120 of the books he had
ordered from EDCA to the spouses Santos.

On the night of the same date, EDCA sought the assistance of the police, which forced their
way into the store of the respondents and threatened Leonor Santos with prosecution for
buying stolen property. They seized the 120 books without warrant, loading them in a van
belonging to EDCA, and thereafter turned them over to the petitioner. Protesting this high-
handed action, respondents sued for recovery of the books after demand for their return was
rejected by EDCA. A writ of preliminary attachment was issued and the petitioner, after initial
refusal, finally surrendered the books to the respondents.

Petitioner contended that respondents have not established their ownership of the
disputed books because they have not even produced a receipt to prove they had
bought the stock.
ISSUE/S
Whether or not petitioner has been unlawfully deprived of the books because the check
issued by the impostor in payment therefor was dishonored.
RULING
Yes, petitioner has been unlawfully deprived of the books.

ART. 1475 of the NCC, provides that the contract of sale is perfected at the moment there is
a meeting of minds upon the thing which is the object of the contract and upon the price.
From that moment, the

parties may reciprocally demand performance, subject to the provisions of the law governing
the form of contracts.
 ART. 1477 of the NCC, The ownership of the thing sold shall be transferred to the vendee
upon the actual or constructive delivery thereof.

ART. 1478 of the NCC, The parties may stipulate that ownership in the thing shall not
pass to the purchaser until he has fully paid the price.

It is clear from the above provisions, particularly the last one quoted, that ownership in the
thing sold shall not pass to the buyer until full payment of the purchase price only if there is a
stipulation to that effect. Otherwise, the rule is that such ownership shall pass from the vendor
to the vendee upon the actual or constructive delivery of the thing sold even if the purchase
price has not yet been paid. Non- payment only creates a right to demand payment or to
rescind the contract, or to criminal prosecution in the case of bouncing checks. But absent the
stipulation above noted, delivery of the thing sold will effectively transfer ownership to the
buyer who can in turn transfer it to another.

In the case at bar, actual delivery of the books having been made, Cruz acquired ownership
over the books which he could then validly transfer to the respondents. The fact that he had not
yet paid for them to EDCA was a matter between him and EDCA and did not impair the title
acquired by the private respondents to the books. Leonor Santos took care to ascertain first
that the books belonged to Cruz before she agreed to purchase them. The EDCA invoice Cruz
showed her assured her that the books had been paid for on delivery. By contrast, EDCA was
less than cautious — in fact, too trusting — in dealing with the impostor. Although it had never
transacted with him before, it readily delivered the books he had ordered (by telephone) and as
readily accepted his personal check in payment. It did not verify his identity although it was
easy enough to do this. It did not wait to clear the check of this unknown drawer. Worse, it
indicated in the sales invoice issued to him, by the printed terms thereon, that the books had
been paid for on delivery, thereby vesting ownership in the buyer.

Therefore, although the title of Cruz was presumed under Article 559 by his mere possession
of the books, these being movable property, Leonor Santos nevertheless demanded more
proof before deciding to buy them. It would certainly be unfair now to make the respondents
bear the prejudice sustained by EDCA as a result of its own negligence. Respondents have
themselves been unduly inconvenienced, and for merely transacting a customary deal not
really unusual in their kind of business. It is they and not EDCA who have a right to complain.
[TANA, JOHMELY CEN]

2G SALES
3. Phil. Suburban G.R. No. L-19545
Development Corp. vs. DATE: April 18, 1975
Auditor General
PONENTE: VITUG, J
DOCTRINE Delivery of possession, coupled with the execution of the
Deed of Absolute Sale, had consummated the sale and
transferred the title to the purchaser.
FACTS
On June 8, 1960, at a meeting with the Cabinet, the President of the Philippines, acting on the
reports of the Committee created to survey suitable lots for relocating squatters in Manila and
suburbs, approved in principle the acquisition by the People's Homesite and Housing
Corporation of the unoccupied portion of the Sapang Palay Estate in Sta. Maria, Bulacan and
of another area either in Las Piñas or Parañaque, Rizal, or Bacoor, Cavite for those who desire
to settle south of Manila. On June 10, 1960, the Board of Directors of the PHHC passed
Resolution No. 700 (Annex "C") authorizing the purchase of the unoccupied portion of the
Sapang Palay Estate at P0.45 per square meter "subject to the following conditions precedent:

3. That the President of the Philippines shall first provide the PHHC with the necessary funds
to effect the purchase and development of this property from the proposed P4.5 million bond
issue to be absorbed by the GSIS.

4. That the contract of sale shall first be approved by the Auditor General pursuant to Executive
Order dated February 3, 1959.

On July 13, 1960, the President authorized the floating of bonds under Republic Act Nos. 1000
and 1322 in the amount of P7,500,000.00 to be absorbed by the GSIS, in order to finance the
acquisition by the PHHC of the entire Sapang Palay Estate at a price not to exceed P0.45 per
sq. meter.

On December 29,1960, Petitioner Philippine Suburban Development Corporation, as owner of

the unoccupied portion of the Sapang Palay Estate and the People's Homesite and Housing
Corporation, entered into a contract embodied in a public instrument entitled "Deed of Absolute
Sale" whereby the former conveyed unto the latter the two parcels of land abovementioned.
This was not registered in the Office of the Register of Deeds until March 14, 1961, due to the
fact, petitioner claims, that the PHHC could not at once advance the money needed for
registration expenses.

In the meantime, the Auditor General, to whom a copy of the contract had been submitted for
approval in conformity with Executive Order No. 290, expressed objections thereto and
requested a re-examination of the contract, in view of the fact that from 1948 to December 20,
1960, the entire hacienda was assessed at P131,590.00, and reassessed beginning December
21, 1960 in the greatly increased amount of P4,898,110.00.

It appears that as early as the first week of June, 1960, prior to the signing of the deed by the
parties, the PHHC acquired possession of the property, with the consent of petitioner, to
enable the said PHHC to proceed immediately with the construction of roads in the new
settlement and to resettle the squatters and flood victims in Manila who were rendered
homeless by the floods or ejected from the lots which they were then occupying.

On April 12, 1961, the Provincial Treasurer of Bulacan requested the PHHC to withhold the
amount of P30,099.79 from the purchase price to be paid by it to the Philippine Suburban
Development Corporation. Said amount represented the realty tax due on the property involved
for the calendar year 1961. Petitioner, through the PHHC, paid under protest the
abovementioned amount to the Provincial Treasurer of Bulacan and thereafter, or on June 13,
1961, by letter, requested then Secretary of Finance Dominador Aytona to order a refund of the
amount so paid. Upon recommendation of the Provincial Treasurer of Bulacan, said request
was denied by the Secretary of Finance in a letter-decision dated August 22, 1961.

**Petitioner claimed that it ceased to be the owner of the land in question upon the execution of
the Deed of Absolute Sale on December 29, 1960. It is now claimed in this appeal that the
Auditor General erred in disallowing the refund of the real estate tax in the amount of
P30,460.90 because aside from the presumptive delivery of the property by the execution of
the deed of sale on December 29, 1960, the possession of the property was actually delivered
to the vendee prior to the sale, and, therefore, by the transmission of ownership to the vendee,
petitioner has ceased to be the owner of the property involved, and, consequently, under no
obligation to pay the real property tax for the year 1961.

**Respondent, however, argues that the presumptive delivery of the property under Article
1498 of the Civil Code does not apply because of the requirement in the contract that the sale
shall first be approved by the Auditor General, pursuant to the Executive Order.
ISSUE/S
Whether or not the petitioner ceased to be the owner over the property hence not liable for the
payment of property tax or whether or not there was delivery.
RULING
Yes.

Considering the aforementioned approval and authorization by the President of the Philippines
of the specific transaction in question, the prior approval by the Auditor General envisioned by
Administrative Order would therefore, not be necessary.

Under the civil law, delivery (tradition) as a mode of transmission of ownership maybe actual
(real tradition) or constructive (constructive tradition). 2 When the sale of real property is made
in a public instrument, the execution thereof is equivalent to the delivery of the thing object of
the contract, if from the deed the contrary does not appear or cannot clearly be inferred.

In other words, there is symbolic delivery of the property subject of the sale by the execution of
the public instrument, unless from the express terms of the instrument, or by clear inference
therefrom, this was not the intention of the parties. Such would be the case, for instance, when
a certain date is fixed for the purchaser to take possession of the property subject of the
conveyance, or where, in case of sale by installments, it is stipulated that until the last
installment is made, the title to the property should remain with the vendor, or when the
vendor reserves the right to use and enjoy the properties until the gathering of the
pending crops, or where the vendor has no control over the thing sold at the moment of
the sale, and, therefore, its material delivery could not have been made.

In the case at bar, there is no question that the vendor had actually placed the vendee in
possession and control over the thing sold, even before the date of the sale. The
condition that petitioner should first register the deed of sale and secure a new title in
the name of the vendee before the latter shall pay the balance of the purchase price, did
not preclude the transmission of ownership. In the absence of an express stipulation to the
contrary, the payment of the purchase price of the good is not a condition, precedent to the
transfer of title to the buyer, but title passes by the delivery of the goods.

WHEREFORE, the appealed decision is hereby reversed, and the real property tax paid under
protest to the Provincial Treasurer of Bulacan by petitioner Philippine Suburban Development
Corporation, in the amount of P30,460,90, is hereby ordered refunded. Without any
pronouncement as to costs.
VILLON, ERIKA PATRICIA
2G SALES Obligation of the Seller
Rosaroso vs. Soria G.R. No. 194846
June 19, 2013
MENDOZA, J.
DOCTRINE The requirement of the law then is two- fold: acquisition in good faith and registration in
good faith. Good faith must concur with the registration. If it would be shown that a buyer
was in bad faith, the alleged registration they have made amounted to no registration at
all.
FACTS
Spouses Rosaroso (Luis and Honorata) acquired several real properties in Cebu. They had nine
children, some of whom were Lucila (respondent); Hospicio, Antonio, Manuel, Angelica and Cleofe (petitioners
herein). After Honorata’s death, Luis married Lourdes. A complaint for declaration of nullity of documents was
filed by Luis against his daughter Lucila Soria, his granddaughter Laila, and Meridian corp. In the complaint,
petitioners Hospicio, Antonio, Angelica and Cleofe alleged that Luis, with full knowledge and consent of
Lourdes, executed a deed of absolute sale covering 6 lots in Daanbatayan, Cebu in their favor. Despite this,
respondent Laila, in conspiracy with Lucila, obtained Luis’ (who was then infirm, blind and of unsound mind)
thumbmark which authorized them to sell three lots (Lots 8, 22 and 23) in 1993. [1st SALE]
On 1994, a second SPA was obtained where Laila and her husband mortgaged Lot No. 19 to Vital Lending
Investors, Inc. for and in consideration of a sum of money. Petitioners further averred that a second sale took
place August 23, 1994, when the respondents made Luis sign the Deed of Absolute Sale conveying to Meridian
said three (3) parcels of residential land for P960,500.00.[SECOND SALE]
For their part, respondents averred that the DOA executed by Luis was valid. Further, they argue that, granting
that the First Sale was valid, the properties belong to them as they acquired these in good faith and had them
first recorded in the Registry of Property, as they were unaware of the 1st sale. The RTC ruled in favor of
petitioners. It held that when Luis executed the second deed of sale in favor of Meridian, he was no longer the
owner of said lots as he had already sold them to his children. In fact, the subject properties had already been
delivered to the vendees who had been living there since birth and so had been in actual possession of the
said properties. The trial court stated that although the deed of sale was not registered, this fact was not
prejudicial to their interest. On appeal, the CA reversed said judgement, upholding the validity of sale between
Lucila and Meridian.
ISSUE/S:
Whether Meridian is a buyer in good faith, entitling them of the said property in case of double
sale
RULING
NO. Ownership of an immovable property which is the subject of a double sale shall be transferred:
(1) to the person acquiring it who in good faith first recorded it in the Registry of Property;
(2) in default thereof, to the person who in good faith was first in possession; and
(3) in default thereof, to the person who presents the oldest title, provided there is good faith.
The requirement of the law then is two- fold: acquisition in good faith and registration in good faith. Good faith
must concur with the registration. If it would be shown that a buyer was in bad faith, the alleged registration
they have made amounted to no registration at all. The principle of primus tempore, potior jure (first in time,
stronger in right) gains greater significance in case of a double sale of immovable property. When the thing sold
twice is an immovable, the one who acquires it and first records it in the Registry of Property, both made in
good faith, shall be deemed the owner. Verily, the act of registration must be coupled with good faith — that is,
the registrant must have no knowledge of the defect or lack of title of his vendor or must not have been aware
of facts which should have put him upon such inquiry and investigation as might be necessary to acquaint him
with the defects in the title of his vendor. When a piece of land is in the actual possession of persons other than
the seller, the buyer must be wary and should investigate the rights of those in possession. Without making
such inquiry, one cannot claim that he is a buyer in good faith. When a man proposes to buy or deal with realty,
his duty is to read the public manuscript, that is, to look and see who is there upon it and what his rights are. A
want of caution and diligence, which an honest man of ordinary prudence is accustomed to exercise in making
purchases, is in contemplation of law, a want of good faith. The buyer who has failed to know or discover that
the land sold to him is in adverse possession of another is a buyer in bad faith
[VILLON, ANA LAUREN KEI F.]

2G SALES Module 3: I. Obligations of the Seller

(Article 1544, New Civil Code)
5. SKUNAC CORPORATION VS. SYLIANTENG G.R. NO. 205879
APRIL 23, 2014

PERALTA, J.:
DOCTRINE
FACTS
The civil cases involved two (2) parcels of land, both found in Block 2 of the Pujalte Subdivision situated along
Wilson Street, Greenhills, San Juan City which are portions of a parcel of land previously registered in the
name of Luis A. Pujalte on October 29, 1945 and covered by Transfer Certificate of Title ("TCT") No. (-78865)
(-2668) -93165 ("Mother Title") of the Register of Deeds for the City of Manila.

Plaintiffs-appellants Roberto S. Sylianteng and Caesar S. Sylianteng ("appellants") base their claim of
ownership over the subject lots a Deed of Absolute Sale executed in their favor by their mother, Emerenciana
Sylianteng ("Emerenciana"), on June 27, 1983. Appellants further allege that Emerenciana acquired the lots
from the late Luis Pujalte [Luis] through a Deed of Sale dated June 20, 1958. Then, when she sold the lots to
appellants, TCT No. 39488, covering the same, was issued in their names.

[Herein petitioners] Skunac Corporation ("Skunac") and Alfonso F. Enriquez ("Enriquez"), on the other hand,
claim that a certain Romeo Pujalte who was declared by the RTC of Pasig City, Branch 151 in Special
Proceedings No. 3366 as the sole heir of Luis Pujalte, caused the reconstitution of the Mother Title resulting to
its cancellation and the issuance of TCT No. 5760-R in his favor. Romeo Pujalte then allegedly sold the lots to
Skunac and Enriquez in 1992. Thus, from TCT No. 5760-R, TCT No. 5888-R, for Lot 1 was issued in the name
of Skunac, while TCT No. 5889-R for Lot 2 was issued in the name of Enriquez.

[Respondents] contend that they have a better right to the lots in question because the transactions conveying
the same to them preceded those claimed by [petitioners] as source of the latter's titles. [Respondents] further
assert that [petitioners] could not be considered as innocent purchasers in good faith and for value because
they had prior notice of the previous transactions as stated in the memorandum of encumbrances annotated on
the titles covering the subject lots. [Petitioners], for their part, maintain that [respondents] acquired the lots
under questionable circumstances it appearing that there was no copy of the Deed of Sale, between
Emerenciana and Luis Pujalte, on file with the Office of the Register of Deeds.
On November 16, 2007, the Regional Trial Court of Pasig (RTC) rendered judgment in favor of herein
petitioners. The CA reversed and set aside the decision of the RTC.
ISSUE/S
(1) Whether or not respondents' predecessor-in-interest, Emerenciana, validly acquired the subject lots from
Luis, and (2) whether or not respondents, in turn, validly acquired the same lots from Emerenciana. – YES
RULING
The Court rules in the affirmative, but takes exception to the CA's and RTC's application of Article 1544 of the
Civil Code.

Reliance by the trial and appellate courts on Article 1544 of the Civil Code is misplaced. The requisites that
must concur for Article 1544 to apply are:
(a) The two (or more sales) transactions must constitute valid sales;
(b) The two (or more) sales transactions must pertain to exactly the same subject matter;
(c) The two (or more) buyers at odds over the rightful ownership of the subject matter must each represent
conflicting interests; and
(d) The two (or more) buyers at odds over the rightful ownership of the subject matter must each have bought
from the very same seller.

Obviously, said provision has no application in cases where the sales involved were initiated not by just one but
two vendors. In the present case, the subject lots were sold to petitioners and respondents by two different
vendors – Emerenciana and Romeo Pujalte (Romeo). Hence, Article 1544 of the Civil Code is not applicable.

Nonetheless, the Court agrees with the findings and conclusion of the CA that Emerenciana's acquisition of the
subject lots from Luis and her subsequent sale of the same to respondents are valid and lawful.
BERNAL, JULIEROSE VICTORIA

2G SALES [TOPIC] Obligations of the Seller

1. Manicque-Stone v. Cattleya land Inc. G.R. NO. 195975
DATE: September 5, 2016
PONENTE: Del Castillo
DOCTRINE
FACTS
Short Facts:
Cattleya Land sent its counsel Atty. Cabilao to Tagbilaran city to investigate the RD of the status of the
properties of the Tecson Spouses because Cattleya wanted to purchase them. Cattleya the entered into a
Contract of Conditional Sale with the Tecson Spouses for 9 parcels of their land which included 1 parcel of land
that was attached to a civil case. The parties then entered into a deed of absolute sale for the property in
question, but neither the Contract of conditional sale nor the deed of absolute sale could be annotated on the
certificate of title over the land because the RD stated that it was improper due to the fact that it was attached
to a civil case. The lawyers of both the Tecson spouses and Cattleya land requested the RD again to provide
for the necessary original certificate of title and all other documents but the RD refused because there was still
not final court order for the civil case covering the property.

The writ of attachment over the property was then lifted because the parties in that case settled for a
compromise agreement, however Cattleya still did not succeed in having the deed of absolute sale registered
by the RD because it couldn’t surrender the owner’s (Tecson Spouses) copy of the TCT. The Tecson spouses
stated that the TCT was destroyed by a fire however it turned out to be false and that there was a different
application for registration of a deed of absolute sale to the Petitioner Taina Manigque Stone.
Cattleya then instituted a civil action for quieting of title and recovery of ownership with damages against Taina.

Petitioner’s Contention:
Taina’s contention is that they have a better right over the subject property because they have already
contracted with the Tecson spouses and even made an initial downpayment and subsequent payments after
when Tecson executed a deed of absolute sale.

Respondent’s Contention:
Cattleya’s contention is that they have a superior right over the lot because they were the first to register the
sale in good faith even if at the time of the sale, the TCT and the OCT could not yet be issued because the civil
case was still pending at that time. Cattleya was the first to file to register the sale with the RD.

Brief Rulings of Lower Courts:

The RTC ruled in favor of Cattleya because they were the first to register the sale in good faith and they gave 3
reasons on why Taina’s position is untenable; (1) Taina’s common law husband was a foreigner and therefore
the sale of land were void, (2) at the time of the sale Taina was only Mike’s “dummy” and their marriage did not
validate the sale, (3) Taina admitted that at the time of the registration of the sale and issued title to her she
knew that the same lot was sold to Cattleya.

The CA only affirmed the decision of the RTC.

ISSUE/S
Whether or not Taina has a better right to the property.
RULING
NO, the SC ruled that Cattleya has a better right. The Sc rebutted the petitioner’s arguments by first stating that
Taina herself admitted that it was Mike who paid for the lot using his own funds and even if the deed of sale
stated that it was Taina who was the buyer, it was only because Mike wanted to avoid the constitutional
prohibition. Therefore, there can be no double sale because the sale to Taina and her husband were void ab
initio.

Caraan, Raldin Hilario A.

2G SALES DOUBLE SALES

Spring Homes Subdivision Co., Inc. vs. Tablada, Jr. G.R. NO. 200009
DATE: January 23, 2017

PONENTE: INTING, J.:
DOCTRINE Principle of Primus Tempore, Potior Jure; The principle of primus tempore, potior jure (first
in time, stronger in right) gains greater significance in case of a double sale of immovable
property.
Knowledge gained by the first buyer of the second sale cannot defeat the first buyer’s
rights except only as provided by law, as in cases where the second buyer first registers in
good faith the second sale ahead of the first.
In order for the Spouses Lumbres to obtain priority over the Spouses Tablada, the law
requires a continuing good faith and innocence or lack of knowledge of the first sale that
would enable their contract to ripen into full ownership through prior registration.
FACTS
In 1996, Spring Homes entered into a Deed of Absolute Sale with the Spouses Tablada over a parcel of land
located at Lot No. 8, Block 3, Spring Homes Subdivision, Barangay Bucal, Calamba, Laguna. The Spouses
Tablada, however, were not able to register the property under their name because Spring Homes was not
able to give them the title over the same.
In 2000, Spring Homes likewise entered into a Deed of Sale over the same property. Hence, the Spouses
Tablada filed a complaint for Nullification of Title, Reconveyance and Damages against Spring Homes and the
Spouses Lumbres. Later, however, the Spouses Tablada dropped Spring Homes from the case.
The RTC dismissed the Spouses Tablada’s complaint. The CA reversed the RTC ruling and held that the first
sale between Spring Homes and the Spouses Tablada must still be upheld as valid, contrary to the contention
of the Spouses Lumbres that the same was not validly consummated due to the Spouses Tablada's failure to
pay the full purchase price of P409,500.00.
ISSUE/S
Whether or not the Spouses Tablada properly acquired ownership over the subject property
RULING
Yes. The Spouses Tablada properly acquired ownership over the subject property.
The principle of primus tempore, potior jure (first in time, stronger in right) gains greater significance in case of
a double sale of immovable property. Thus, the Court has consistently ruled that ownership of an immovable
property which is the subject of a double sale shall be transferred: (1) to the person acquiring it who in good
faith first recorded it in the Registry of Property; (2) in default thereof, to the person who in good faith was first
in possession; and (3) in default thereof, to the person who presents the oldest title, provided there is good
faith. The requirement of the law then is two-fold: acquisition in good faith and registration in good faith. Good
faith must concur with the registration that is, the registrant must have no knowledge of the defect or lack of title
of his vendor or must not have been aware of facts which should have put him upon such inquiry and
investigation as might be necessary to acquaint him with the defects in the title of his vendor. If it is shown that
a buyer was in bad faith, the alleged registration they have made amounted to no registration at all.
The first buyers of the subject property, the Spouses Tablada, were able to take said property into possession
but failed to register the same because of Spring Homes' unjustified failure to deliver the owner's copy of the
title whereas the second buyers, the Spouses Lumbres, were able to register the property in their names. But
while said the Spouses Lumbres successfully caused the transfer of the title in their names, the same was
done in bad faith because they knew that the subject lot was previously sold to the Spouses Tablada.
Indeed, knowledge gained by the first buyer of the second sale cannot defeat the first buyer's rights except only
as provided by law, as in cases where the second buyer first registers in good faith the second sale ahead of
the first. Such knowledge of the first buyer does bar her from availing of her rights under the law, among them,
first her purchase as against the second buyer. But conversely, knowledge gained by the second buyer of the
first sale defeats his rights even if he is first to register the second sale, since such knowledge taints his prior
registration with bad faith.
case.
[CALZADO, VALERIE]

2G SALES DOUBLE SALE

MR. AND MRS. ERNESTO MANLAN, PETITIONERS, v. MR. AND MRS. G.R. NO. G.R. No. 222530
RICARDO BELTRAN, RESPONDENTS. DATE: October 16, 2019
PONENTE: INTING, J.:

DOCTRINE XXXX
FACTS
The lot in question is 1,214 square meter (sq.m.) land situated in Barangay Calindagan, Dumaguete City
forming part of Lot 1366-E and originally owned in common by the Orbetas.

The present case involves the conflicting claims of two sets of buyers over a parcel of land. One group avers
of having bought the property from one of its co-owners and building their house thereon in good faith.
Meanwhile, the other group claims of having bought the same land from all the co-owners and
registered it in good faith. On May 5, 1983, Spouses Manlan (petitioners) bought a 500 sq.m. portion of the
subject property from Manuel Orbeta for P30,000.00. After receiving the advance payment of P15,000.00,
Manuel Orbeta allowed petitioners to occupy it. On October 21, 1986, the Orbetas (except for Manuel Orbeta
who was already deceased; thus, represented by his wife Emiliana Villamil Orbeta) executed a Deed of
Absolute Sale (DOAS) conveying the 714 sq.m. portion of the same property to Spouses Ricardo and Zosima
Beltran (respondents).

On November 20, 1990, respondents bought the remaining 500 sq.m. from the Orbetas, as evidenced by
another DOAS. Consequently, on January 28, 1991, the subject property was registered in respondents' name.
Later, respondents demanded from petitioners to vacate the property in dispute, but to no avail. Respondents
claimed to be the absolute owners of the subject property having bought it from the Orbetas and that the 1990
Deed was fictitious, having been procured by means of falsification and insidious scheme and machination
because at the time it was notarized, one of the co-owners, Serbio, was already dead.

Petitioners alleged that they bought the 500 sq.m. portion of the disputed land from Serbio and Manuel Orbeta
in 1983. Petitioners insist that this is a plain case of double sale. They argue that they bought in good faith the
500 sq.m. portion of Lot 1366-E in 1983, while respondents bought the subject property only in 1990. They
stress that they have a better right over the property following the rules on double sale under Article 1544 of the
New Civil Code.

RTC RULED IN FAVOR OF the Beltrans, case was elevated to CA.

ISSUE/S
Whether the rules on double sale under Article 1544 of the New Civil Code are applicable;
RULING
NO. there is double sale when the same thing is sold to different vendees by a single vendor. 27 It only means
that Article 1544 has no application in cases where the sales involved were initiated not just by one vendor but
by several vendors.

Here, petitioners and respondents acquired the subject property from different transferors. The DOAS 29 dated
November 20, 1990 shows that all of the original co-owners (except for Manuel and Serbio, who are already
deceased) sold the subject lot to respondents. On the other hand, the Receipt and Promissory Note30 both
dated May 5, 1983, reveal that only Manuel sold the lot to petitioners. As found by the RTC and the CA,
nothing on the records shows that Manuel was duly authorized by the other co-owners to sell the subject
property in 1983.

Evidently, there are two sets of vendors who sold the subject land to two different vendees. Thus, this Court
upholds the findings of the trial court and the CA that the rule on double sale is not applicable in the instant
case.
[CUNANAN, JEAN]

NOTE:
Article 1544 of the New Civil Code provides:
Art. 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 the possession; and, in the absence thereof, to the person who presents the oldest title,
provided there is good faith.

In Cheng v. Genato,25 the Court enumerated the requisites in order for Article 1544 to
apply, viz.:
The two (or more) sales transactions in issue must pertain to exactly the same subject
(a)
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.26

2G SALES AND LEASE Obligations of the Seller

10. SPOUSES SALITICO vs. RESURRECCION G.R. NO. 240199
10 April 2019
CAGUIOA, J.
DOCTRINE In a contract of sale, the parties’ obligations are plain and simple. The law obliges the
vendor to transfer the ownership of and to deliver the thing that is the object of sale to the
vendee
FACTS
This case stemmed from a complaint for Specific Performance with Damages filed by petitioners Spouses
Salitico against respondents Heirs of Resurreccion Martinez Felix (respondents-heirs) and Recaredo
Hernandez, in his capacity as the Administrator of the Estate of Amanda Burgos.
Amanda Burgos was the registered owner of a parcel of land in Bulacan, registered in her name under an
OCT. By virtue of a document entitled “HULING HABILIN NI AMANDA BURGOS” in 1986, subject land was
inherited by her niece Resurrecion Martinez Felix. The pertinent provision of the Huling Habilin provides:
Sa aking pamangkin na si RESURRECCION MARTINEZ-FELIX, 'RESY', ay aking
inaaboy ang apat (4) na parselang lupang palayan na napapaloob sa mga titulong
sumusunod. xxx
Thereafter, Resurrecion, as the new owner of the subject property, executed a document “BILIHANG
TULUYAN NG LUPA” in 1998 which transferred ownership over the parcel of land in favor of herein petitioners
Spouses Salitico. The spouses then took physical possession of the property. Subsequently, a proceeding for
the probate (establishing validity of a will) was undertaken before the RTC and respondent Recaredo was
appointed as executor of the Huling Habilin. Recaredo then presented said habilin before the probate court,
and was approved in 2008.

In 2010, petitioners received a demand letter requiring them to vacate subject property and surrender
possession over it to the respondent heirs. Petitioners then filed a complaint against respondent Heirs of
Resurreccion Martinez; Recaredo Hernandez, as Administrator of the Estate of Amanda Burgos; and the
Register of Deeds of Bulacan.

The RTC ruled in favor of respondents as Resurreccion had indeed validly sold the subject property which she
inherited from Amanda to the petitioners Sps. Salitico. Nevertheless, the RTC held that the spouses’ action
was premature on the ground that it was not shown that the Probate Court had already fully settled the Estate
of Amanda, even as it was not disputed that the Huling Habilin had already been allowed & certified. The CA
affirmed the same
ISSUE/S
1. Whether or not the petitioner spouses are already the owners of the subject property.
2. Whether or not the Register of Deeds may be compelled to issue a new certificate of title in the name of
the petitioners.
RULING
1. YES, the spouses Salitico are the owners of the subject property.

Article 777 of the Civil Code states that the rights of the inheritance are transmitted from the moment of the
death of the decedent. Article 777 operates at the very moment of the decedent’s death meaning that the
transmission by succession occurs at the precise moment of death and, therefore, at that precise time, the heir
is already legally deemed to have acquired ownership of his/her share in the inheritance.

As applied to the instant case, upon the death of Amanda, Resurreccion became the absolute owner of the
devised subject property, subject to a resolutory condition that upon settlement of Amanda’s Estate, the
devise is not declared inofficious or excessive. Hence, there was no legal bar preventing Resurreccion
from entering into a contract of sale with the petitioners Sps. Salitico with respect to the former’s share or
interest over the subject property.

In a contract of sale, the parties’ obligations are plain and simple. The law obliges the vendor to transfer the
ownership of and to deliver the thing that is the object of sale to the vendee. Therefore, as a
consequence of the valid contract of sale entered into by the parties, Resurreccion had the obligation to deliver
the subject property to the spouses Salitico. In fact, it is not disputed that the physical delivery of the subject
property to the petitioners-spouses had been done, with the latter immediately entering into possession of the
subject property after the execution of the  Bilihang Tuluyan ng Lupa.
To reiterate, Resurreccion already sold all of her interest over the subject property to the petitioners Sps.
Salitico. The respondents-heirs have absolutely no rhyme nor reason to continue possessing the owner’s
duplicate copy of certificate of title.

2. NO, the RD may not be compelled to issue a new certificate of title in the name of the spouses.

Nevertheless, the existence of a valid sale in the instant case does not necessarily mean that the RD may
already be compelled to cancel the OCT and issue a new title in the name of the petitioners Sps. Salitico.
According to Section 92 of PD 1529, otherwise known as the Property Registration Decree, with respect to the
transfer of properties subject of testate or intestate proceedings, a new certificate of title in the name of the
transferee shall be issued by the Register of Deeds only upon the submission of a certified copy of the
partition and distribution, together with the final judgment or order of the court approving the same or
otherwise making final distribution, supported by evidence of payment of estate tax or exemption therefrom, as
the case may be.

This provision of the PD 1529 is in perfect conjunction with Rule 90, Section 1 of the Rules of Court, which
states that the actual distribution of property subject to testate or intestate proceedings, i.e., the issuance of a
new title in the name of the distributee, shall occur only when the debts, funeral charges, and expenses of
administration, the allowance to the widow, and inheritance tax, if any, chargeable to the estate, have
been paid. Only then can the testate or intestate court assign the residue of the estate to the persons entitled
to the same. Hence, under the applicable provisions of PD 1529 and the Rules of Court, it is only upon the
issuance by the testate or intestate court of the final order of distribution of the estate or the order in
anticipation of the final distribution that the certificate of title covering the subject property may be issued in the
name of the distributees.

In the instant case, there is no showing that, in the pendency of the settlement of the Estate of Amanda, the
Probate Court had issued an order of final distribution or an order in anticipation of a final distribution, both of
which the law deems as requirements before the RD can issue a new certificate of title in the name of the
petitioners Sps. Salitico.

Therefore, the RD shall not be compelled to issue a new certificate of title in the name of the spouses.
ESCARCHA, HARVEY