Caram vs. LauretaG . R . N o . L - Yes.

There is no doubt then that Irespe and Aportadera,

2 8 7 4 0 F e b r u a r y 2 4 , 1 9 8 1 FERNANDEZ, actinga s a g e n t s o f C a r a m , p u r c h a s e d t h e p r o p e r t y
o f M a t a i n b a d f a i t h . Applying the principle of agency,
J.: Caram as principal, should also be deemed to have acted in bad
faith.Since Caram was a registrant in badfaith, the situation is as if
FACTS: there was no registration at all. A possessor i n g o o d f a i t h i s
one who is not aware that there exists in his title
On June 10, 1945, Marcos Mata conveyed
o r mode of acquisition any flaw which invalidates it. Laureta
a l a r g e t r a c t o f agricultural land covered by OC T No.
was first inpossession of the property. He is also a possessor
3019 in favor of Claro Laureta,plaintiff, the respondent herein.
in good faith. It is true that Mata had alleged that the deed of sale in favor
The deed of absolute sale in favor
of Laureta wasprocured by force. Such defect, however, was
of t h e p l a i n t i f f w a s n o t r e g i s t e r e d b e c a u s e i t w a s n o t a
cured when, after the
c k n o w l e d g e d before a notary public or any other authorized
officer. Since June 10,1945, the plaintiff Laureta had been and is in Jerome C. Aviso
continuous, adverse andnotorious occupation of said land, without being
molested, disturbed ors t o p p e d b y a n y o f t h e d e f e n d a n t s o r
t h e i r r e p r e s e n t a t i v e s . I n f a c t , Laureta had been paying realty
taxes due thereon and had introducedimprovements worth not less than lapse of four years from the time the intimidation ceased, Marcos Matalost
P20,000.00 at the time of the filingof the complaint. On Ma y 5, 1947, both his rights to file an action for annulment or to set up nullity of the
the same land covered by OC T No.3 0 1 9 w a s s o l d b y contract as a defense in an action to enforce the same.
Marcos Mata to defendant Fermin Z. Caram,
Jr.,p e t i t i o n e r h e r e i n . T h e d e e d o Jerome C. Aviso
f s a l e i n f a v o r o f C a r a m w a s ackn
owledged before Atty. Abelardo Aportadera. On Decem
b e r 9 , 1947, the second sale between Marcos Mata and Fermin Caram, Jr.
wasr e g i s t e r e d w i t h t h e R e g i s t e r o f D e e d s . O n t h e s a m e
d a t e , T r a n s f e r Certificate of Title No. 140 was issued in favor of Fermin
Caram Jr.Thed e f e n d a n t F e r m i n C a r a m J r .
claimed that he has no knowledge ori n f o r m a t i o n a b o
ut the previous encumbrances, transactions, an
d alienations in favor of plaintiff until the filing of the complaints.

ISSUE:

W h e t h e r o r n o t t h e k n o w l e d g e p e t i
t i o n e r o f a p r i o r unregistered sale of a titled
p r o p e r t y a t t r i b u t a b l e t o p e t i t i o n e r a n d equivalent in law of
registration of sale.

HELD: