ARMANDO S. OLIZON and ILUMINADA C. OLIZON vs. COURT OF APPEALS and PRUDENTIAL BANK G.R. No.

107075 PONENTE: REGALADO, J. FACTS: Armando and Iluminada Olizon obtained a loan from respondent Prudential Bank in the amount of P25,000.00 and, as security , they executed in favor of respondent bank a real estate mortgage over a parcel of land consisting of 1,000 square meters located at Barrio Calaanan, Kalookan City and registered in their names under TCT No. 24604 of the Registry of Deeds of Kalookan City. Olizon spouses failed to pay their aforestated obligation upon its maturity, so private respondent extrajudicially foreclosed the real estate mortgage. At a public auction the subject property was sold to respondent bank as the highest bidder, pursuant to which it was issued a certificate of sale as. The said certificate of sale was duly annotated at the back of petitioner's Transfer Certificate of Title No. 24604. again due to the failure of petitioner spouses to redeem the foreclosed property within the period of redemption, title to the property was consolidated in favor of respondent bank. Respondent bank filed with the RTC of Kalookan City a petition to reconstitute Transfer Certificate of Title No. 24604, which was lost in the Office of the Registry of Deeds of Kalookan City. The RTC ordered the reconstitution prayed for. Transfer Certificate of Title No. 149858 was issued in the name of respondent bank. Respondent bank this time filed with the RTC a petition for the issuance of a writ of possession against petitioner spouses, and which petition was granted by the trial court.petition, by way of opposition, was filed by petitioner spouses wherein they sought the cancellation of the writ of possession, the nullification of the certificate of sale , and/or the nullification of the foreclosure proceedings. In support thereof, they alleged lack of notice of the auction sale and lack of posting of the notice of sale as required by Section 3 of Act No. 3135, as amended. ISSUE: Whether or not there has been a constructive notice HELD: Xxx it is an entrenched doctrine in our jurisdiction that registration in a public registry is notice to the whole world. The record is a constructive notice of its contents as well as of all interest, legal and equitable, included therein. All persons are charged with knowledge of what it contains. Therefore, in the case at bar, the annotation of the certificate of sale on petitioners' Transfer Certificate of Title No. 24604 and the filing of the affidavit of consolidation with the Register of Deeds constituted constructive notice of both acts to herein petitioners. Consequently, as early as March 11, 1974 when the certificate of sale was annotated at the back of their title, petitioners were already charged with knowledge of the foreclosure sale, yet they still failed or refused to take the necessary steps to protect their rights over the subject property. XXX September 1, 1994

Expresscredit Financing Corporation VS Sps Morton and Juanita Velasco GR NO.156033 October 20, 2005

PONENTE:QUISUMBING, J. FACTS: Respondents purchased on installment, from spouses Jesus and Lorelei Garcia (Garcia spouses), a house and lot in Quezon City, covered by Transfer Certif icate of Title No. 3250 in the name of Jesus Garcia. A Deed of Absolute Sale was executed whereby the Garcia spouses bound themselves to deliver the title of the property purchased, free from all liens and encumbrances within 15 days from full payment. Respondents were thereafter informed by the Garcia spouses that since the house on the property was still under construction, the lot was still covered by the mother title and had no separate title as yet. They promised to give the title after the construction was completed.The keys to the property were delivered to the respondents. They moved in, applied for a telephone connection, and insured the house. When respondents followed up on the title, the Garcia spouses told them that since the Quezon City Hall was razed by a fire in June, the title had to be reconstituted, so their separate title could not yet be delivered to them. Because the Garcia spouses would not deliver the title despite repeated demands, respondents went to the Register of Deeds in Quezon City and discovered that the Garcia spouses had mortgaged the property to petitioner, Expresscredit Financing Corporation, for P250,000 on June 15, 1989, or more than a year after the property was sold to them. The respondents filed a case for Quieting of Title and Specific Performance against the Garcia spouses before the court a quo, whereby they caused registration of a notice of lis pendens on the title, attaching thereto a copy of their complaint stating that they have been the owners of the said property since May 25, 1988. The Garcia spouses were subsequently declared in default for failing several times to appear in court despite notice.Petitioner foreclosed on the property in defiance of the notice of lis pendens and the Writ of Preliminary Injunction issued by the lower court, enjoining petitioner from selling or in any manner disposing of the property without permission from the court. Petitioner sold the property in a public auction where petitioner was the highest bidder. Due to the failure of the Garcia spouses to redeem the property, petitioner thereafter executed an Affidavit of Consolidation and secured Certificate of Title No. 69049 in its name. ISSUE: Whether or not Expresscredit Financing Corporation is an incumbrancer in bad faith such that it did not acquire good title against the respondents. HELD: A purchaser cannot close his eyes to facts which should put a reasonable man upon his guard and 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 the lack of it, is a question of intention; but in ascertaining the intention,

courts are necessarily controlled by the evidence as to the conduct and outward acts by which alone the inward motive may, with safety, be determined. Indeed, where the land sold in auction sale was registered under the Torrens System, the purchaser at the execution sale acquired such rights, title and interest of the judgment debtor as appearing on the certificate of title issued on the property, subject to no liens, encumbrances or burdens that were not noted thereon. Petitioners claim that it purchased the property at an auction sale is of no moment. In this case, particular circumstances constrain us to rule that petitioner was neither a mortgagee nor a purchaser in good faith and as such, could not acquire good title to the property as against the former transferee.

ADELAIDA MENESES (deceased), substituted by her heir MARILYN M. CARBONELGARCIA, VS ROSARIO G. VENTUROZO G.R. No. 172196 October 19, 2011

PONENTE: FACTS: Rosario G. Venturozo, respondent herein, filed a Complaint for ownership, possession x x x and damages in the RTC of Dagupan City against defendant Adelaida Meneses, alleging that she is the absolute owner of an untitled coconut land, containing an area of 2,109 square meters, situated at Embarcadero, Mangaldan, Pangasinan, and declared under Tax Declaration No. 239. Plaintiff alleged that she purchased the property from the spouses Basilio de Guzman and Crescencia Abad as evidenced by a Deed of Absolute Sale, and that the vendors, in turn, purchased the property from defendant as evidenced by a Deed of Absolute Sale. Plaintiff alleged that she has been in possession of the land until May 1983 when defendant with some armed men grabbed possession of the land and refused to vacate despite repeated demands prompting her to engage the services of counsel. Plaintiff prayed that after preliminary hearing, a writ of preliminary mandatory injunction be issued; and that after hearing, a decision be rendered declaring her as the owner of the property in dispute, ordering defendant to vacate the property in question and to pay her P5,000.00 as attorneys fees; P1,000.00 as litigation expenses; P10,000.00 as damages and to pay the costs of suit. ISSUE: Whether the sale made by defendant Adelaida Meneses in favor of plaintiffs father, Basilio de Guzman, was valid. HELD: In this case, it should be pointed out that contrary to the finding of the Court of Appeals, the Deed of Sale dated June 20, 1966 did not comply with the formalities required by law,

specifically Act No. 496, otherwise known as The Land Registration Act, which took effect on January 1, 1903, as Section 127 of the Act provides:

FORMS Section 127. Deeds, conveyances, mortgages, leases, releases, and discharges affecting lands, whether registered under this Act or unregistered, shall be sufficient in law when made substantially in accordance with the following forms, and shall be as effective to convey, encumber, lease, release, discharge, or bind the lands as though made in accordance with the more prolix form heretofore in use: Provided, That every such instrument shall be signed by the person or persons executing the same, in the presence of two witnesses, who shall sign the instrument as witnesses to the execution thereof, and shall be acknowledged to be his or their free act and deed by the person or persons executing the same, before the judge of a court of record or clerk of a court of record, or a notary public, or a justice of the peace, who shall certify to such acknowledgment x x x. In the Deed of Absolute Sale dated June 20, 1966, the Notary Public signed his name as one of the two witnesses to the execution of the said deed; hence, there was actually only one witness thereto. Moreover, the residence certificate of petitioner was issued to petitioner and then it was given to the Notary Public the day after the execution of the deed of sale and notarization; hence, the number of petitioners residence certificate and the date of issuance (June 21, 1966) thereof was written on the Deed of Absolute Sale by the Notary Public on June 21, 1966, after the execution and notarization of the said deed on June 20, 1966. Considering the defect in the notarization, the Deed of Absolute Sale dated June 20, 1966 cannot be considered a public document, but only a private document, and the evidentiary standard of its validity shall be based on preponderance of evidence. Section 20, Rule 132 of the Rules of Court provides that before any private document offered as authentic is received in evidence, its due execution and authenticity must be proved either: (a) by anyone who saw the document executed or written; or (b) by evidence of the genuineness of the signature or handwriting of the maker. In regard to the genuineness of petitioners signature appearing on the Deed of Absolute Sale dated June 20, 1966, the Court agrees with the trial court that her signature therein is very much different from her specimen signatures and those appearing in the pleadings of other cases filed against her, even considering the difference of 17 years when the specimen signatures were made. Hence, the Court rules that petitioners signature on the Deed of Absolute Sale dated June 20, 1966 is a forgery. The Court agrees with petitioner that her admission was taken out of context, considering that in her Answer to the Complaint, she stated that the alleged Deed of Sale purportedly executed by her in favor of Basilio de Guzman is a forgery; that she never signed the said Deed of Sale; that she did not appear personally before the Notary Public; and that she did not secure the residence certificate mentioned in the said Deed of Sale. She also testified that she never sold her land to Basilio de Guzman; that she never met the Notary Public, Attorney Abelardo Biala,and that she did not meet Basilio de Guzman on June 20, 1966. The trial court found petitioner and her testimony to be credible, and declared the Deed of Sale dated June 20, 1966 null and void ab initio. These circumstances negate the said admission.