Sps Abrigo v.

De Vera

Hence, this Petition.9

FACTS: Villafania sold a house and lot located

Pangasinan and Tigno-Salazar and Cave-Go
covered by a tax declaration. Unknown, however
to Tigno-Salazar and a Cave-Go, Villafania
obtained a free patent over the parcel of land
involved.The said free patent was later on
cancelled by a TCT.
On Oct 16, 1997, Tigno-Salazar and Cave-Go,
sold the house and lot to the Spouses Abrigo.
On Oct 23, 1997, Villafania sold the same house
and lot to de Vera. De Vera registered the sale
and as a consequence a TCT was issued in her
name.
De Vera filed an action for Forcible Entry and
Damages against Spouses Abrigo before the
MTC.
Spouses Abrigo filed a case with the RTC for the
annulment of documents, injunction, preliminary
injunction, restraining order and damages
Villafania.
The parties submitted a Motion for Dismissal in
view of their agreement in the instant (RTC) case
that neither of them can physically take
possession of the property in question until the
instant case is terminated. Hence the ejectment
case was dismissed.
The RTC rendered judgment approving the
Compromise Agreement submitted by the parties.
In the said Decision, Villafania was given one year
from the date of the Compromise Agreement to
buy back the house and lot, and failure to do so
would mean that the previous sale in favor of
Tigno-Salazar and Cave-Go shall remain valid and
binding and the plaintiff shall voluntarily vacate
the premises without need of any demand.
Villafania failed to buy back the house and lot, so
the [vendees] declared the lot in their name
The RTC rendered the assailed Decision awarding
the properties to Spouses Abrigo as well as
damages. Moreover, Villafania was ordered to pay
[petitioners and private respondent] damages
and attorneys fees.
Not contented with the assailed Decision, both
parties [appealed to the CA].
In its original Decision, the CA held that a void
title could not give rise to a valid one and hence
dismissed the appeal of Private Respondent de
Vera. Since Villafania had already transferred
ownership to Rosenda Tigno-Salazar and Rosita
Cave-Go, the subsequent sale to De Vera was
deemed void.The CA also dismissed the appeal of
Petitioner-Spouses Abrigo and found no sufficient
basis to award them moral and exemplary
damages and attorneys fees.
On reconsideration found Respondent De Vera to
be a purchaser in good faith and for value. The
appellate court ruled that she had relied in good
faith on the Torrens title of her vendor and must
thus be protected.

ISSUE: Who between petitioner-spouses and

respondent has a better right to the property.
HELD: DE VERA
The petition is denied, and the assailed decision
affirmed.The present case involves what in legal
contemplation was a double sale. Gloria Villafania
first sold the disputed property to Tigno-Salazar
and Cave-Go, from whom petitioners, in turn,
derived their right. Subsequently a second sale
was executed by Villafania with Respondent de
Vera.
Article 1544 of the Civil Code states the law on
double sale thus:
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.
There is no ambiguity in the application of this
law with respect to lands registered under the
Torrens system.
In the instant case, both Petitioners Abrigo and
respondent registered the sale of the property.
Since neither petitioners nor their predecessors
(Tigno-Salazar and Cave-Go) knew that the
property was covered by the Torrens system, they
registered their respective sales under Act 3344
For her part, respondent registered the
transaction under the Torrens system because,
during the sale, Villafania had presented the
transfer certificate of title (TCT) covering the
property.
Soriano v. Heirs of Magali23 held that registration
must be done in the proper registry in order to
bind the land. Since the property in dispute in the
present case was already registered under the
Torrens system, petitioners registration of the
sale under Act 3344 was not effective for
purposes of Article 1544 of the Civil Code.
More recently, in Naawan Community Rural Bank
v. Court of Appeals,24 the Court upheld the right
of a party who had registered the sale of land
under the Property Registration Decree, as
opposed to another who had registered a deed of
final conveyance under Act 3344. In that case,
the priority in time principle was not applied,
because the land was already covered by the
Torrens system at the time the conveyance was
registered under Act 3344. For the same reason,

inasmuch as the registration of the sale to

Respondent De Vera under the Torrens system
was done in good faith, this sale must be upheld
over the sale registered under Act 3344 to
Petitioner-Spouses Abrigo.

declared the Occea spouses as buyers in good

faith and ruled that the action of the heirs was
time-barred. Court of Appeals reversed the
decision of the trial court. Hence the petition.

Issue: Whether or not a purchaser of a registered

land is obliged to make inquiries of any possible
defect or adverse claim which does not appear on
the Certificate of Title

Ruling: Petition dismissed.

SPOUSES TOMAS OCCEA and SILVINA

OCCEA vs. LYDIA MORALES OBSIANA
ESPONILLA
June 4, 2004
Second Division

G.R. No. 156973

PUNO, J.:
Facts:
Spouses Nicolas and Irene Tordesillas owned a
piece of land which their children Harod, Angela
and Rosario, and grandchildren Arnold and Lilia
de la Flor inherited. The heirs sold a part of the
land to Alberta Morales. Morales possessed the
lot as owner, constructed a house on it and
appointed a caretaker to oversee her property.
Arnold borrowed the Original Certificate of Title
(OCT) from Alberta covering the lot. Then, he
executed an Affidavit acknowledging receipt of
the OCT in trust and undertook to return said title
free from changes, modifications or cancellations.
However, Arnold used the OCT he borrowed from
the vendee Alberta Morales, subdivided the entire
lot into three sublots, and registered them all
under his name. Arnold did not return the OCT
belonging to Alberta despite repeated requests.
Arnold subsequently sold the land to spouses
Tomas and Sylvina Occea. When the respondent
heirs of Alberta learned of the sale, they filed a
case for annulment of sale and cancellation of
titles, with damages, against the Occea spouses,
alleging bad faith since the Occeas conducted
ocular inspection of the area before the purchase
and their caretaker warned them that Arnold is no
longer the owner of the lot being sold. On the
other hand, the Occea spouses alleged that they
were buyers in good faith as the titles to the
subject lots were free from liens or encumbrances
when they purchased them, that they verified
with the Antique Registry of Deeds that Arnolds
TCTs were clean and unencumbered. Lower court

The petition at bar presents a case of

double sale of an immovable property. Article
1544 of the New Civil Code provides that in case
an immovable property is sold to different
vendees, the ownership shall belong: (1) to the
person acquiring it who in good faith first
recorded it in the Registry of Property; (2) should
there be no inscription, the ownership shall
pertain to the person who in good faith was first
in possession; and, (3) in the absence thereof, to
the person who presents the oldest title, provided
there is good faith.
In all cases, good faith is essential. It is the
basic premise of the preferential rights granted to
the one claiming ownership over an immovable.
What is material is whether the second buyer first
registers the second sale in good faith, i.e.,
without knowledge of any defect in the title of the
property sold. The defense of indefeasibility of a
Torrens title does not extend to a transferee who
takes the certificate of title in bad faith, with
notice of a flaw.
Indeed, the general rule is that one who
deals with property registered under the Torrens
system need not go beyond the same, but only
has to rely on the title. He is charged with notice
only of such burdens and claims as are annotated
on the title. However, this principle does not
apply when the party has actual knowledge of
facts and circumstances that would impel a
reasonably cautious man to make such inquiry or
when the purchaser has knowledge of a defect or
the lack of title in his vendor or of sufficient facts
to induce a reasonably prudent man to inquire
into the status of the title of the property in
litigation. One who falls within the exception can
neither be denominated an innocent purchaser
for value nor a purchaser in good faith.

Isabela Colleges, Inc. vs. Heirs of Nieves

TolentinoRivera
October 20, 2000
Second Division
Ponente: Justice Mendoza

G.R. No.132677

Facts: The late Nieves Tolentino-Rivera and her

husband, Pablo Rivera, were married in 1921.
Nieves, still using her maiden name, filed an
application for a sales patent over a 13.5267hectare land in Cauayan, Isabela. Her application
was approved and a sales patent was issued in
the name of Nieves Tolentino, married to Pablo
Rivera.
The above said spouses sold to petitioner Isabela
four hectares of their land, which was thereafter
immediately occupied by the petitioner and used
the same as its new campus. Since 1950, the
Isabela Colleges declared the land for tax
purposes, but it did not immediately secure a
separate title to the property. It was only on
January 13, 1970 when it secured a title to the
land.
In December 1976, the Office of the Register of
Deeds of Isabela was burned. Among the titles
destroyed was that of the Isabela Colleges which
was however administratively reconstituted in
1978.
In January 1988, certain people entered the
property of Isabela Colleges, prompting the latter
to bring an action for forcible entry. The Municipal
Trial Court of Cauayan, Isablela rendered a
decision ordering the intruders to vacate the land
in question.
In 1991, Nieves brought the present suit against
the Isabela Colleges for Nullity of Titles, Deeds of
Sale, Recovery of Ownership and Possession,
Cancellation of Titles, Damages with Preliminary
Injunction. In its Answer, the Isabela Colleges
asserted that the property in question had been
sold to it with the knowledge and consent of
Nieves who in fact signed the deed of sale.
Moreover, herein petitioner contends that the
complaint was barred by prescription and/or
laches.
Two complaints-in-intervention were allowed by
the trial court. The intervenors, who were the
parties in the ejectment suit, claimed to be
buyers in good faith or lessees of Nieves as to
certain portions of the subject land.
During the pendency of this case Nieves died and
her heirs substituted her. On September 30,
1994, the trial court rendered its decision, ruling
in favor of Isabela Colleges. On Appeal, its
decision was reversed. Hence, this petition.

Issue: Whether the Court of Appeals erred in

ruling that:
1.) the
subject property is paraphernal despite Nieves
admission that it was purchased from the
government during her marriage with Pablo
Rivera out of conjugal funds;
2.)
Nieves signature in the questioned deed of sale
is forged;
3.)
laches cannot defeat that claim of a registered
property owner despite the long delay of 41
years.
Ruling: Wherefore the decision of the Court of
Appeals is REVERSED.
Issue 1: Both the acquisition of the 13-hectare
land and the sale of a portion thereof to petitioner
in 1949 took place when the Spanish Civil Code
was still in effect. Under Article 1407 of that code,
the property of the spouses are deemed conjugal
partnership property in the absence of proof that
it belongs exclusively to one or the other spouse.
This presumption arises with respect to property
acquired during the marriage. It is not necessary
to prove that the property was acquired with
conjugal funds.
Indeed, other than its finding that Nieves was
already in possession of the land and applied for
a sales patent before she married Pablo Rivera,
the Court of Appeals cited no other evidence to
prove that the land was her paraphernal property.
On the contrary, the evidence clearly shows that
the land was acquires during her marriage with
Pablo Rivera.
Issue 2: The fact that Nieves Tolentinos signature
in the deed of sales is a forgery does not,
however, render the deed of sale void. The land
was conjugal property and under the Spanish Civil
Code, the wifes consent to the sale is not
required. Therefore, that her signature is a
forgery is determinative only of Nieves lack of
consent but not of the validity of the sale.
As the husband may validly sell or dispose of
conjugal property even without the wifes
consent, the absence of the wifes consent alone
does not make the sale in fraud of her.
Issue 3: Nonetheless while it is true that a Torrens
title is indefeasible and imprescriptible, the
registered owner may lose his right to recover
possession of his registered property by reason of
laches.
Laches means the failure or neglect for an
unreasonable and unexplained length of time to
do that which, by observance of due diligence,
could or should have been done earlier. It is
negligence or omission to assert a right within a
reasonable time, warranting the presumption that

the party entitled to assert his right either has

abandoned or declined to assert it.
So it is in the present case where the complaint
questioning the validity of the sale to petitioner
Isabela Colleges was filed only after 42 years had
lapsed. Respondents could not feign ignorance of
the sale because petitioner had been in open,
public, and continuous possession of the land,
which it had used as its school campus since
1949.

There is no question from the records that

respondent Nogales was the first to buy the
subject property from Julia, who in turn bought
the same from the Canino brothers and sisters.
Petitioners, however, rely on the fact that they
were the first to register the sales of the different
portions of the property resulting in the issuance
of new titles in their names.
Article 1544 of the Civil Code governs the
preferential rights of vendees in cases of multiple
sales, as follows:

Bayoca vs. Nogales

September 12, 2000
Third Division
Justice Gonzaga-Reyes

Ruling: Petition is hereby DENIED and the

assailed DECISION of the Court of Appeals is
AFFIRMED.

G.R.No.138201
Ponente:

Facts: Gaudioso Nogales acquired ownership

over the subject property on the basis of the
Compromise Agreement and the Deed of
Absolute Sale executed by Julia Deocareza who
had acquired of said property from the Canino
brothers and sisters. However, Preciosa Canino
subsequently sold at different times portions of
the subject property to herein petiitoners,
Francisco Bayoca, Nonito Dichoso, Erwin Bayoca,
and spouses Pio and Dolores Dichoso.
The Appellee, filed complaint against the
Appellants for Accion Reinvindicatoria with
Damages. He alleged in his complaint, that he
purchased the said property from Julia Decareza
and thus acquired ownership thereof and that the
Appellants respectively purchased portions of
said property in bad faith and through fraud. The
Appellants, in their Answer to the complaint,
alleged that Preciosa Canino and her siblings
acquired just title over the property when they
executed their Deed of Partition of Real
Property and conveyed titles to the vendees, the
Appellants in the present recourse, as buyers in
goof faith.
The Regional Trial Court ruled in favor of Nogales
and declared that the sales of portions of said
property by Preciosa Canino were null and void.
The trial court further declared further that
petitioners were purchasers in bad faith.
On appeal, the court of Appeals affirmed the RTC
ruling. Hence this petition.
Issue: Who has the superior right to the parcel of
land sold to different buyers at different times by
its former owners?

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 possession; and in the absence thereof, to
the person who presents the oldest title, provided
there is good faith.
Based on the foregoing, to merit the protection
under Article 1544, second paragraph, the second
buyer must act in good faith in registering the
deed. Thus, It has been held that in cases of
double sale of immovables, what finds relevance
and materiality is not whether or not the second
buyer was a buyer in good faith but whether or
not said second buyer registers such second sale
in good faith, that is, without knowledge of any
defect in the title of the property.
On account of the undisputed fact of registration
by respondent Nogales as the first buyer,
necessarily, there is absent good faith in the
registration of the sale by the petitioners Erwin
Bayoca and the spouses Pio and Lourdes Dichoso
for which they had been issued certificates of title
in their names. As for the petitioners Francisco
Bayoca and Nonito Dichoso, they failed to register
the portions of the property sold to them, and
merely rely on the fact that they declared the
same in their name for taxation purposes. Suffice
it to state, that such fact, does not, by itself,
constitute evidence of ownership and cannot
likewise prevail over the title of respondent
Nograles.

Severino Baricuatro, Jr.,

vs.
Court of Appeals, Tenth Division, Mariano B.
Nemenio
and
Felisa
V.
Nemenio,
Constantino M. Galeos and Eugenio V.
Amores
February 9, 2000

G.R. No. 105902

Buena, J.:
FACTS:
Baricuatro bought two lots, part of the Victoria
Village, on installments basis from Galeos on
October 16, 1968.
Two months from the date of the previous sale,
Galeos sold the entire subdivision, including the
two lots, to Amores. Baricuatro was informed by
Galeos about the sale and was advised to pay the
balance of the purchase price of the two lots
directly to Amores.
Amores took possession of the subdivision and
developed the same for residential purposes. He
secured the transfer of the title to the same in his
name. Afterwards, he sold the two lots of the
spouses Mariano and Felisa Nemenio. Prior to the
sale, Baricuatro was informed through a letter by
Amores about the impending sale of the two lots
but the former failed to respond. Nemenio
spouses demanded from Baricuatro to vacate the
said lots but the latter refused to do so.
Trial court rendered a decision, declaring
Nemenio spouses as the owners of the disputed
lot. Court of Appeals affirmed in toto the
judgment of the trial court.
ISSUE:
1. Whether the sale made to Amores by
Galeos is valid?
2. Whether the Nemenio
purchasers in good faith?

spouses

are

RULING:
Issue 1
Amores was in good faith when he bought the
subdivision, however, when he registered his title
he already had knowledge of the previous sale.
Such knowledge tainted his registration with bad
faith. In addition, the agreement to collect the
balance of the purchase price of the disputed lots
from Baricuatro which presupposes knowledge of
the previous sale by Amores.

Under Art. 1544, the ownership of an immovable

property shall belong to the purchaser who in
good faith registers it first in the registry of
property.

(Uraca vs Ca) 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. This means that
the good faith of the purchaser should be from
the time of the perfection of the sale until up to
the time that he be declared the sole and true
owner of the property.
Issue 2
Nemenio spouses only visited the lots ten months
after the sale which was evidenced during the
trial of the case. And so, they cannot claim to be
purchasers in good faith when they registered the
title. The registration made by the spouses were
done in bad faith, hence, it amounted to no
inscription at all.
Decision of CA is REVERSED.

RAUL SABERON, JOAN F. SABERON and

JACQUELINE
SABERON, Petitioners,
vs.
OSCAR VENTANILLA, JR., and CARMEN
GLORIA D. VENTANILLA, Respondents.
Facts:
On March 3, 1970, Manila Remnant Co., Inc.
(MRCI) and A.U. Valencia & Co. Inc. (AUVC)
executed two (2) contracts to sell in favor of
Oscar C. Ventanilla, Jr. and Carmen Gloria D.
Ventanilla (Ventanillas). MRCI resold the same
property to Carlos Crisostomo (Crisostomo).
Aggrieved, the Ventanillas commenced an action
for specific performance, annulment of deeds and
damages against MRCI, AUVC, and Crisostomo
with the Court of First Instance. The CFI Quezon
City rendered a decision in favor of the
Ventanillas. The CA sustained the CFI Quezon
Citys decision in toto. The Ventanillas moved for
the issuance of a writ of execution. The writ was
issued and served upon MRCI.

However, MRCI alleged that the subject properties

could not longer be delivered to the Ventanillas
because they had already been sold to Samuel
Marquez (Marquez)
The case was elevated to this Court where MRCI
argued that the sale of the properties to Marquez
was valid because at the time of the sale, the
issue of the validity of the sale to the Ventanillas
had not yet been resolved. Further, there was no
specific injunction against it re-selling the
property. As a buyer in good faith, Marquez had a
right to rely on the recitals in the certificate of
title. The subject matter of the controversy
having been passed to an innocent purchaser for
value, the execution of the absolute deed of sale
in favor of the Ventanillas could not be ordered by
the trial court. Yet the court ruled in favor of the
Vetanillas. As it turned out, the execution of the
judgment in favor of the Ventanillas was yet far
from fruition. Samuel Cleofe, Register of Deeds
for Quezon City (ROD Cleofe) revealed to them,
that on March 11, 1992, MRCI registered a deed
of absolute sale to Marquez who eventually sold
the same property to the Saberons, which
conveyance was registered in July 1992. ROD
Cleofe opined that a judicial order for the
cancellation of the titles in the name of the
Saberons was essential before he complied with
the writ of execution in Civil Case No. 26411.
Apparently, the notice of levy, through
inadvertence, was not carried over to the title
issued to Marquez, the same being a junior
encumbrance which was entered after the
contract to sell to Marquez had already been
annotated.
Once again, the Ventanillas were constrained to
go to court to seek the annulment of the deed of
sale executed between MRCI and Marquez as well
as the deed of sale between Marquez and the
Saberons, as the fruits of void conveyances. RTC
ruled in favor of the Ventanillas
Meanwhile, the Saberons filed a case in the CA
relying on one central argumentthat they were
purchasers in good faith, having relied on the
correctness of the certificates of title covering the
lots in question; and therefore, holders of a valid
and indefeasible title. CA ruled in favor of the
Ventanillas.
The Saberons filed the present
petition.
Unknown to the Saberons, the former owner of
the properties had entered into contracts to sell
with the Ventanillas, way back in 1970. It was
only upon receipt of the summons in the case
filed by the Ventanillas with the RTC that they
learned of the present controversy.

With the RTC and the CA rulings against their title

over the properties, the Saberons now come to
the Court with their vehement insistence that
they were purchasers in good faith and for value.
Before purchasing the lots, they exercised due
diligence and found no encumbrance or
annotations on the titles. At the same time, the
Ventanillas also failed to rebut the presumption of
their good faith as there was no showing that
they confederated with MRCI and its officers to
deprive the Ventanillas of their right over the
subject properties.
According to the Saberons, the CA likewise erred
in ruling that there was no constructive notice of
the levy made upon the subject lands.
Issue:
Whether or not there was constructive notice of
levy as an encumbrance prior to the sale to the
Saberons.
Ruling:
the Court is beckoned to rule on two conflicting
rights over the subject properties: the right of the
Ventanillas to acquire the title to the registered
land from the moment of inscription of the notice
of levy on the day book (or entry book), on one
hand; and the right of the Saberons to rely on
what appears on the certificate of title for
purposes of voluntary dealings with the same
parcel of land, on the other.
The Saberons could not be said to have authored
the entanglement they found themselves in. No
fault can be attributed to them for relying on the
face of the title presented by Marquez.
In
ultimately ruling for the Ventanillas, the courts a
quo focused on the superiority of their notice of
levy and the constructive notice against the
whole world which it had produced and which
effectively bound third persons including the
Saberons.
This complex situation could have been avoided if
it were not for the failure of ROD Cleofe to carry
over the notice of levy to Marquezs title, serving
as a senior encumbrance that might have
dissuaded the Saberons from purchasing the
properties.
It is undeniable, therefore, that no title was
transferred to Marquez upon the annotation of
the contract to sell on MRCIs title. As correctly
found by the trial court, the contract to sell
cannot be substituted by the Deed of Absolute
Sale as a "mere conclusion" of the previous
contract since the owners of the properties under

the two instruments are different. Considering

that the deed of sale in favor of Marquez was of
later registration, the notice of levy should have
been carried over to the title as a senior
encumbrance.
The fact that the notice of levy on attachment
was not annotated on the original title on file in
the Registry of Deeds, which resulted in its nonannotation on the title TCT No. PT-94912, should
not prejudice petitioner. As long as the requisites
required by law in order to effect attachment are
complied with and the appropriate fees duly paid,
attachment is duly perfected. The attachment
already binds the land. This is because what
remains to be done lies not within the petitioners
power to perform but is a duty incumbent solely
on the Register of Deeds.
In the case at bench, the notice of levy covering
the subject property was annotated in the entry
book of the ROD QC prior to the issuance of a TCT
in the name of the Saberons. Clearly, the
Ventanillas levy was placed on record prior to the
sale. This shows the superiority and preference in
rights of the Ventanillas over the property as
against the Saberons.

share of the said lot to Caridad Rodrigueza as well

as a Deed of Absolute Sale whereby Mariano and
Caridad transferred their respective rights to the
subject lot in favor of petitioner Krystle Realty
Development Corporation (Krystle Realty), the
original certificate of title was cancelled. In lieu
thereof, three (3) TCTs were issued all on the
same day in the names of the Rodriguezas at
one-half (12) share each, and in the name of
Krystle Realty covering the entire lot.
Claiming that he had not sold his share to Caridad
nor received any consideration for the alleged
transfer, and that the signature on the deed of
sale was not his, Domingo sought to annul the
said deed. He died, however, during the
pendency of the case, and was consequently
substituted by his heirs, herein respondents.
Caridad, on the other hand, insisted that she had
paid Domingo in two (2) instalments. She then
took possession of Domingos one-half (12)
portion of the subject lot and declared the same
for taxation purposes. For its part, Krystle Realty
claimed that it was a purchaser in good faith, and
that the action, if at all, should be directed
against Caridad.
Caridad likewise died, and was substituted first by
her brother, Mariano, and upon the latters death,
by Rufino Rodrigueza.
The parties agreed to submit to a handwriting
expert of the NBI the determination of the
genuineness of Domingos signature on the deed
of sale. NBI issued stating that the questioned
and the standard/sample signatures of Domingo
submitted to it for examination were written by
one and the same person.

KRYSTLE
REALTY
DEVELOPMENT
CORPORATION, REPRESENTED BY CHAIRMAN
OF THE BOARD, WILLIAM C. CU, vs
DOMINGO ALIBIN, AS SUBSTITUTED BY HIS
HEIRS, NAMELY: BEATRIZ A. TORZAR,
VIRGINIA A. TARAYA, ROSARIO A. MARCO,
JESUS A. ALIBIN, AND JAY ALIBIN, AS
SUBSTITUTED BY HIS CHILDREN, NAMELY:
JAYNES ALIBIN, JAY ALIBIN, AND JESUS
ALIBIN, JR.s.G.R. No. 196117, August 13,
2014PERLAS-BERNABE, J.
Facts: Respondent Domingo Alibin owned an
undivided one-half portion of Lot No. 1680
situated at Tahao, Legazpi City, Albay, and
registered in his name and that of Mariano
Rodrigueza. On the strength of a contract to sell
purporting to convey Domingos one-half (12)

The RTC declared Krystle Realty to be a purchaser

in bad faith in view of the admission of its
representative, Mr. William Cu, that he was aware
of the fact that Domingo was part owner of the
subject lot and that he even asked a certain Rudy
Gueco to talk to Domingo about the sale of his
one- half (12) share.
Aggrieved, Krystle Realty and Caridad elevated
their cases on appeal before the CA. CA affirmed
the findings of the RTC.
Issue: Whether or not the Krystle Realty as a
purchaser in bad faith.
Held: No. Krystle Realtys claim that it is a buyer
in good faith, the Court finds that the latter
cannot veer away from the admission of its
representative, Mr. William Cu, i.e., that he was
aware of Domingos interest in the subject lot,
and that Caridad had no title in her name at the

time of the sale, thus, giving rise to the

conclusion that it (Krystle Realty) had been
reasonably apprised of the ownership controversy
over the subject lot. This notwithstanding, records
show that Krystle Realty proceeded with the
transaction without further examining the sellers
title and thus, could not claim to have purchased
the subject lot in good faith. Verily, one is
considered a buyer in bad faith not only when he
purchases real estate with knowledge of a defect
or lack of title in his seller but also when he has
knowledge of facts which should have alerted him
to conduct further inquiry or investigation, as
Krystle Realty in this case. Further, the
irregularities attending the issuance of TCT as
pointed out by the CA are equally indicative of
lack of good faith on Krystle Realtys part. Indeed,
what it failed to realize is that, as one asserting
the status of a buyer in good faith and for value,
it had the burden of proving such status, which
goes beyond a mere invocation of the ordinary
presumption of good faith.

Attorneys Fees; and the cost of suit.

The spouses Florentino Leong (Florentino) and
Carmelita Leong (Carmelita) used to own the
property located at No. 53941 Z.P. De Guzman
Street, Quiapo, and Manila.
Petitioner Elena Leong (Elena) is Florentino's
sister-in-law. She had stayed with her in-laws on
the property rental-free for over two decades until
the building they lived in was razed by fire. They
then constructed makeshift houses, and the
rental-free arrangement continued.
Florentino and Carmelita immigrated to the
United States and eventually had their marriage
dissolved in Illinois. A provision in their marital
settlement agreement states that Florentino
shall convey and quitclaim all of his right, title
and interest in and to 540 De Guzman Street,
Manila, Philippines . . . to Carmelita.
The Court of Appeals found that [a]pparently
intercalated in the lower margin of page 12 of the
instrument was a long-hand scribbling of a
proviso, purporting to be a footnote remark:

FLORENTINO W. LEONG AND ELENA LEONG,

ET AL., vs. EDNA C. SEE G.R. NO. 194077, 03
December 2014
Facts: This petition originated from two civil
complaints involving the sale of a parcel of land in
favor of respondent Edna C. See (Edna). Before us
is a petition for review assailing the Court of
Appeals (a) May 19, 2010 decision affirming in
toto the trial court's July 9, 2008 decision granting
Edna possession and ownership over the land
upon finding her to be a buyer in good faith and
for value, and (b) August 25, 2010 resolution
denying reconsideration.
Petitioners pray for the reversal of the Court of
Appeals decision and resolution, as well as the
trial courts decision. They pray that this court
render its decision as follows:
(a) The Deed of Sale between Edna See and
Carmelita Leong is hereby declared null and void.
The Register [of] Deeds for the City of Manila is
hereby directed to cancel TCT No. 231105 in the
name of Edna See and reinstating TCT No.
175628;
(b) Confirming the right of Elena Leong and those
people claiming right under her, to the possession
over the subject property; [and] (c) Defendants
Carmelita Leong and Edna See are declared to be
jointly and severally liable to pay plaintiff,
Florentino Leong[,] the sum of Php50,000.00 as
moral damages; the sum of Php50,000.00 a[s]

Neither party shall evict or charge rent to

relatives of the parties, or convey title, until it has
been established that Florentino has clear title to
the Malabon property. Clear title to be established
by the attorneys for the parties or the ruling of a
court of competent jurisdiction. In the event
Florentino does not obtain clear title, this court
reserves jurisdiction to reapportion the properties
or their values to effect a 50-50 division of the
value of the 2 remaining Philippine properties.
On November 14, 1996, Carmelita sold the land
to Edna. In lieu of Florentino's signature of
conformity in the deed of absolute sale, Carmelita
presented to Edna and her father, witness
Ernesto See, a waiver of interest notarized on
March 11, 1996 in Illinois. In this waiver,
Florentino reiterated his quitclaim over his right,
title, and interest to the land. Consequently, the
lands title, covered by TCT No. 231105, was
transferred to Edna's name.
Edna was aware of the Leong relatives staying in
the makeshift houses on the land. Carmelita
assured her that her nieces and nephews would
move out, but demands to vacate were
unheeded.
On April 1, 1997, Edna filed a complaint for
recovery of possession against Elena and the
other relatives of the Leong ex-spouses.
The complaint alleged that in 1995 after the fire
had razed the building on the land, Elena erected

makeshift houses on the land without Carmelitas

knowledge or consent.
In response, Elena alleged the titles legal
infirmity for lack of Florentino's conformity to its
sale. She argued that Carmelita's non-compliance
with the proviso in the property agreement
that the Quiapo property may not be alienated
without Florentino first obtaining a clean title over
the Malabon property annulled the transfer to
Edna.
On April 23, 1997, Florentino filed a complaint for
declaration of nullity of contract, title, and
damages against Carmelita Leong, Edna C. See,
and the Manila Register of Deeds, alleging that
the sale was without his consent. The two cases
were consolidated.
RTC ruled in favor of Edna.CA affirmed in toto the
trial courts decision. Issue: Whether respondent
Edna C. See is a buyer in good faith and for value.
Held: Yes. The Torrens system was adopted 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.
One need not inquire beyond the four corners of
the certificate of title when dealing with
58
registered property.
Section 44 of Presidential
Decree No. 1529 known as the Property
Registration
Decree
recognizes
innocent
purchasers in good faith for value and their right
to rely on a clean title:
Section 44. Statutory liens affecting title. - Every
registered owner receiving a certificate of title in
pursuance of a decree of registration, and every
subsequent purchaser of registered land taking a
certificate of title for value and in good faith,
shall hold the same free from all encumbrances
except those noted in said certificate and any of
the following encumbrances which may be
subsisting, namely:
First. Liens, claims or rights arising or existing
under the laws and Constitution of the Philippines
which are not by law required to appear of record
in the Registry of Deeds in order to be valid
against subsequent purchasers or encumbrances
of record.
Second. Unpaid real estate taxes levied and
assessed within two years immediately preceding
the acquisition of any right over the land by an
innocent purchaser for value, without prejudice to
the right of the government to collect taxes
payable before that period from the delinquent

taxpayer alone.
Third. Any public highway or private way
established or recognized by law, or any
government irrigation canal or lateral thereof, if
the certificate of title does not state that the
boundaries of such highway or irrigation canal or
lateral thereof have been determined.
Fourth. Any disposition of the property or
limitation on the use thereof by virtue of, or
pursuant to, Presidential Decree No. 27 or any
other law or regulations on agrarian reform.
Both lower courts found respondent to be an
innocent purchaser in good faith for value. The
trial court discussed:
By her overt acts, Edna See with her father
verified the authenticity of Carmelitas land title
at the Registry of Deeds of Manila. There was no
annotation on the same thus deemed a clean title
(page 19, TSN, 12 January 2005). Also, she relied
on the duly executed and notarized Certificate of
Authority issued by the State of Illinois and
Certificate of Authentication issued by the Consul
of the Republic of the Philippines for Illinois in
support to the Waiver of Interest incorporated in
the Deed of Absolute Sale presented to her by
Carmelita (Exhibit 2). Examination of the assailed
Certificate of Authority shows that it is valid and
regular on its face. It contains a notarial seal. . . .
The assailed Certificate of Authority is a notarized
document and therefore, presumed to be valid
and duly executed. Thus, Edna Sees reliance on
the notarial acknowledgment found in the duly
notarized Certificate of Authority presented by
Carmelita is sufficient evidence of good faith.
Petitioners beg to disagree with the ruling of the
Honorable Trial Court and the Honorable Court of
Appeals. Respondent Edna See is not a buyer in
good faith. The ruling that every person can rely
on the correctness of the certificate of title and
that the buyer need not go beyond the four
corners of the title to determine the condition of
the property is not absolute and admits of
exception. As held in the case of Remegia
Feliciano vs. Sps. Zaldivar, G.R. No. 162593, 2006
Sep 26 the principle of indefeasibilty of a Torrens
title does not apply where fraud attended the
issuance of the title. The Torrens title does not
furnish a shield for fraud. As such, a title issued
based on void documents may be annulled.
Even assuming the procurement of title was
tainted with fraud and misrepresentation, such
defective title may still be the source of a
completely legal and valid title in the hands of an
innocent purchaser for value.

Respondent, an innocent purchaser in good faith

and for value with title in her name, has a better
right to the property than Elena. Elenas
possession was neither adverse to nor in the
concept of owner.