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XIII. Special Problems in Sales
A. Sale by non-owner (Arts. 559, 1505, 1434)
Article 559. The possession of movable property acquired in
good faith is equivalent to a title. Nevertheless, one who has
lost any movable or has been unlawfully deprived thereof, may
recover it from the person in possession of the same.
If the possessor of a movable lost or which the owner has been
unlawfully deprived, has acquired it in good faith at a public
sale, the owner cannot obtain its return without reimbursing
the price paid therefor. (464a)
Article 1505. Subject to the provisions of this Title, where
goods are sold by a person who is not the owner thereof, and
who does not sell them under authority or with the consent of
the owner, the buyer acquires no better title to the goods than
the seller had, unless the owner of the goods is by his conduct
precluded from denying the seller's authority to sell.
Nothing in this Title, however, shall affect:
(1) The provisions of any factors' act, recording laws, or any
other provision of law enabling the apparent owner of goods
to dispose of them as if he were the true owner thereof;
(2) The validity of any contract of sale under statutory power
of sale or under the order of a court of competent jurisdiction;
(3) Purchases made in a merchant's store, or in fairs, or
markets, in accordance with the Code of Commerce and special
laws. (n)
Article 1434. When a person who is not the owner of a thing
sells or alienates and delivers it, and later the seller or grantor
acquires title thereto, such title passes by operation of law to
the buyer or grantee.
i. when ownership required
- No one can give what he has not or transfer a greater
right to another that he himself has.
- Person can sell only what he owns or is authorized to
sell.
- Sale is a derivative mode of acquiring ownership and
the buyer gets only such rights as the seller had or could
legally sell.
- A derivative right cannot exist higher than its source.
a) perfection
b) consummation
ii. rule on acquisition of ownership by the buyer in case of
sale by non-owner; principle behind the rule (nemo dat quod
non habet)
- GR: One who has no title at all can transfer none, and
that a buyer pays him value in good faith without notice
makes no difference.
- ****Google search of the latin maxim: the purchase of a
possession from someone who has no ownership right
to it also denies the purchaser any ownership title.
iii. exceptions to the rule
a) estoppel
- Where the owner of the goods is, by his conduct,
precluded from denying the seller’s authority to sell
- If the owner is by his conduct precluded from denying
the seller’s authority to sell, the buyer may acquire a
valid title although the seller had neither title nor
authority to transfer title.
- It is essential that the party estopped shall have made a
representation by words or acts and that someone shall
have acted on the faith of this representation in such a
way that he cannot without damage withdraw from the
transaction.
b) recording laws
- Where the law enables the apparent owner to dispose
of the goods as if he were the true owner thereof
- Philippines has no law such as the FACTOR’S ACT unlike
England and US.
- Such law is found in the provisions re:agency in the Civil
Code.
- FACTOR’S ACT
- Designed to protect 3rd persons who (under
specified conditions) deal with an agent
believing him to be the owner of goods.
- Examples of recording laws which may have a bearing
on the validity of a sale made by a person who is not the
owner
- Property Registration Decree (PD1529)
- Land Transportation and Traffic Code
(RA4136)
- Rev. Administrative Code w/ regard to the sale
of large cattle (Sec. 529) and sale of vessels
(Sec. 1171)
- Examples of “any other provisions of law” referred to in
No. 1
- Warehouse Receipts Law (Act No. 2137; Art.
1507-1520)
c) judicial power and statutory sale
- Where the sale is sanctioned by statutory and judicial
authority
- Different laws apply to different types of forced or
involuntary sales under our jurisdiction:
- Ordinary execution sale: Rule 39 of the Rules
of Court on Execution, Satisfaction, and Effect
of Judgements
- Extrajudicial foreclosure sales of real estate
mortgages: Act No. 3135, as amended by Act
No. 4118 (An Act to regulate the sale of
property under special powers inserted in or
annexed to real estate mortgages)
- The rule that the sale must be made by the owner does
not apply when the sale takes place by virtue of an
order of a court of competent jurisdiction.
- Sale by sheriff pursuant to court order is valid
- Government, however, does not warrant the
title to properties sold by the sheriff at a public
auction.
d) merchant store
**De Leon: p. 255
**e) Where the seller has a voidable title which has not been
avoided at the time of the sale. (Art. 1506)
**f) Where seller subsequently acquires title
- When a person conveys property to another of which at
the time he is not the owner, his subsequent acquisition
of title validates his previous conveyance.
- Such doctrine is applicable to conveyance of usufructs
as well as to transfers of full ownership.
iv. subsequent acquisition of title (Art. 1434);
Article 1434. When a person who is not the owner of a thing
sells or alienates and delivers it, and later the seller or grantor
acquires title thereto, such title passes by operation of law to

the buyer or grantee.
iv. rule with respect to immovable property
- Generally, Art. 1505 applies to sale of goods, not
immovable.
- However, the principle in Art. 1505 that a person can
sell only what he owns or is authorized to sell applies to
the sale of immovable.
- Exceptions:
(1) Estoppel
- Owner of the land may be estopped from
claiming that the sale of land was not
authorized.
(2) Sale of land registered under the Torrens
system
- a fraudulent and forged document of sale may
become the root of a valid title if the certificate
of title has already been transferred from the
name of the true owner to the name indicated
by the forger
- Every person dealing in good faith and for
valuable consideration with registered land
may safely rely upon what appears in the
certificate of title and does not have to inquire
further.
- Remedy of person prejudiced: action for
damages against the one who employed fraud
within 4 years from discovery of deception
- Issue of good faith or bad faith essential only
when it is registered land
(3) Where the sale is sanctioned by statutory or
judicial authority
- Title can transfer to buyer in such sale
v. status of contract
B. Sale by owner with voidable title non-owner (Arts. 559,
1506)
Article 559. The possession of movable property acquired in
good faith is equivalent to a title. Nevertheless, one who has
lost any movable or has been unlawfully deprived thereof, may
recover it from the person in possession of the same.
If the possessor of a movable lost or which the owner has been
unlawfully deprived, has acquired it in good faith at a public
sale, the owner cannot obtain its return without reimbursing
the price paid therefor. (464a)
Article 1506. Where the seller of goods has a voidable title
thereto, but his title has not been avoided at the time of the
sale, the buyer acquires a good title to the goods, provided he
buys them in good faith, for value, and without notice of the
seller's defect of title. (n)
i. rule on acquisition by ownership by the buyer; principle
behind the rule
Requisites for Acquisition of Good title by Buyer
1. He buys them before the title of the seller has been
avoided
2. In Good Faith for value
3. Without notice of the seller’s defect of title
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Basis of Rule
● Where the loss has happened which must fall on one of
the 2 innocent persons, it shall be borne by him who is
caused the loss
● Similar to Innocent Purchaser for Value (Property
Registration Decree) → Innocent purchaser for value in
good faith
● Similar to a holder in due course to whom a negotiable
instrument is negotiated for value and in GF (Negotiable
instruments Law)
ii. Art. 559 in relation to Arts. 1505 and 1506
Article 559. The possession of movable property acquired in
good faith is equivalent to a title. Nevertheless, one who has
lost any movable or has been unlawfully deprived thereof, may
recover it from the person in possession of the same.
If the possessor of a movable lost or which the owner has been
unlawfully deprived, has acquired it in good faith at a public
sale, the owner cannot obtain its return without reimbursing
the price paid therefor. (464a)
Article 1505. Subject to the provisions of this Title, where
goods are sold by a person who is not the owner thereof, and
who does not sell them under authority or with the consent of
the owner, the buyer acquires no better title to the goods than
the seller had, unless the owner of the goods is by his conduct
precluded from denying the seller's authority to sell.
Nothing in this Title, however, shall affect:
(1) The provisions of any factors' act, recording laws, or any
other provision of law enabling the apparent owner of goods
to dispose of them as if he were the true owner thereof;
(2) The validity of any contract of sale under statutory power
of sale or under the order of a court of competent jurisdiction;
(3) Purchases made in a merchant's store, or in fairs, or
markets, in accordance with the Code of Commerce and special
laws. (n)
Article 1506. Where the seller of goods has a voidable title
thereto, but his title has not been avoided at the time of the
sale, the buyer acquires a good title to the goods, provided he
buys them in good faith, for value, and without notice of the
seller's defect of title. (n)
- Accdg. to Art. 559, one who has lost any movable, or has
been unlawfully deprived therefor, may recover it from
the person in possession of the same.
- If possessor of movable lost has acquired it in a public
sale, owner cannot obtain its return without
reimbursing the price paid therefor.
- Owner of lost movable may recover it from the person
in possession of the property even if the latter acquired
it in good faith.
C. Double sales (Art. 1544)
Article 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. (1473)

i. requisites for applicability of Article 1544
Article 1544 applicable when requisites occur:
1. The 2 (or more) sales transactions must constitute valid sales;
2. The 2 (or more) sales transactions must pertain to exactly the
same subject matter
3. The 2 (or more) buyers at odds over the rightful ownership of
the subject matter must each represent conflicting interests; and
4. The 2 (or more) buyers at odds over the rightful ownership of
the subject matter must each have bought from the very same
seller
NOTE: Art. 1544 CANNOT be invoked where 2 different contracts
of sale are made by 2 different persons, one of them not being the
owner of the property sold
Rules as to preference of ownership in case of a double sale
• It applies only to purchasers in Good Faith
• If the SAME property is VALIDLY sold by the SAME vendor (who
has an existing right in the property sold and the power to
dispose it), to DIFFERENT vendees, each representing conflicting
rights of said vendees shall be resolved in accordance with the
following rules:
• MOVABLE: Ownership belongs to the Vendee who first takes
possession in Good Faith
• IMMOVABLE: Ownership belongs in the ff order:
1. Vendee who first registers the sale in Good Faith in the
Registry of Deeds
2. In the absence of registration, the vendee who first
takes possession in Good Faith
3. In the absence of both registration and possession, the
vendee who presents the oldest title (who first bought
the property) in Good Faith
Purchaser in Good Faith
• One who buys the property of another without notice that some
other person has a right to or interest in, such property and pays
full and fair price for the same
Sales by Single Vendor
• Art. 1544 contemplated a case of double or multiple sales by a
single vendor to 2 or more buyers
• Conveyance must have been made by a party who has an
existing right in the thing and the power to dispose of it
• It cannot be invoked where the 2 different contracts of sale are
made by 2 different persons, one of them not being the owner of
the property sold
• Even if the sale was made by the same person, if the second sale
was made when such person was no longer the owner of the
property because it has been acquired by the first purchaser in
full dominion, the second purchaser cannot acquire any right
Two or more sales
1. Sale to DIFFERENT vendees
a. There must be at least 2 deeds of sale over the
same property
b. There is no double sale where after the sale of
the property in favor of a person, the vendor
did not anymore execute another sale over the
same property in favor of another
2. VOIDABLE sale
a. 1544 is NOT applicable where there is only
one valid sale, the previous sale having been
found fraudulent or where one deed of sale
was registered ahead of the other but said
deed if found to a forgery, the right of the
other vendee should prevail
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3. Contract of sale FICTITIOUS or FORGED, or Seller
WITHOUT RIGHT TO SELL
a. It does NOT apply if the contract of sale first
registered is fictitious or forged or If the
vendor is not the owner of the property sold
and had no right to sell the same
b. EXCEPTION: A forged deed of sale of
registered land can legally be the root of a
valid title when an IPV intervenes and the
certificate of title has already been transferred
from the name of the true owner to the forger
c. The remedy of the true owner if to bring an
action for damages against the one who cause
or employed the fraud and if the latter is
insolvent, an action against the Treasurer of
the Philippines may be filed for recovery of
damages against the Assurance Fund.
4. DONATION
a. Art 1544 APPLIES to donations made to
different donees
b. A deed of donation executed with all the
formalities of law is on the same footing as a
deed of sale in the form of a public instrument
c. Art. 1544 applies only if the same thing has
been “sold” to different vendees. Therefore, it
does NOT apply if one transaction is a sale and
the other is a donation.
5. Contracts TO SELL and CONDITIONAL Sales
a. Does NOT apply to contract to sell
- Art. 1544 does not apply where the 1st transaction is a
contract to sell for neither a transfer of ownership nor a
sales transaction has been consummated.
- Similarly, art. 1544 does not apply to a case where there
was a sale to one party of the land itself while the other
contract was a mere promise to sell the land.
- SC applied governing principles of Art. 1544 in a
situation where the first contract was a contract was a
contract to sell.
- Knowledge gained by the first buyers under a contract
to sell of the new agreement between the seller and the
second buyer will not defeat their rights as first buyers
except where the second buyer registers or annotates
his transaction or agreement on the title of the subject
properties in good faith ahead of the first buyers.
b. Applies to conditional sales
- SC applied Art. 1544 to a conditional contract of sale in
one case
- In such case, they distinguished contract of sale from
contract to sell (p. 362-363)
- In contract to sell, there being no previous sale of the
property, third person buying such property despite the
fulfillment of the suspensive condition such as the full
payment of the purchase price, for instance, cannot be
deemed a buyer in bad faith and the prospective buyer
cannot seek the relief of reconveyance of the property.
- In conditional contract of sale, upon the fulfillment of
suspensive condition, sale becomes absolute and this
will definitely affect the seller’s title thereto.
- Applying Art. 1544, such second buyer of the
property who may have had actual or
constructive knowledge of such defect in the
seller’s title, or at least was charged with the
obligation to discover such defect, cannot be a
registrant in good faith
- In case a title is issued to the second buyer, the
first buyer may seek reconveyance of the
property subject of the sale.

6. Sale of property to ONE PARTY and Assignment of right
of property
a. Par. 3 1544 does NOT apply to a case where
the sale in favor of one party was the property
itself, while the transaction in favor of another
was a mere promise to assign, or at most, an
actual assignment of the right to repurchase
the same property.
- There must be at least 2 deeds of sale over the same
property
- Not applicable where there is only one valid sale and
the other is voidable (i.e. fraudulent, fictitious or forged)
or if the vendor is not the owner of the property sold
and had no right to sell the same
- Art. 1544 applies to donations made to different donees
- Does not apply to contracts to sell but applies to
conditional sales
Possession of property sold
Possession means both actual physical delivery and constructive
delivery
● Actual delivery – when the thing is placed under the
control and possession of the vendee
● Constructive delivery – when the sale is made through a
public instrument, the execution thereof shall be
equivalent to delivery if from the deed the contrary
does not appear or cannot be clearly inferred
• After the sale of realty by means of a public instrument, the
vendor who resells it to another, does not transmit anything to
the second vendee, and if the latter, by virtue of the second sale,
takes material possession of the thing, he does it as mere
detainer, and it would be unjust to protect this detention against
the rights of the thing lawfully acquired by the first vendee
• The fact that the first sale was notarized does NOT mean that
the second sale cannot be given effect ! if the land is registered
under the TS, the mere execution of a sale by means of a public
instrument will not bind 3rd persons (including the second
buyer).
• If the first sale (albeit notarized) was not registered with the
Register of Deeds, and the second buyer acquired the same
property in GF and registers the sale in GF with the RD ! the
second buyer should prevail
Purchaser with notice of right of repurchase which as
already elapsed
- Situation: a purchaser buys a property with notice that
there is a right of redemption that has already elapsed.
There is no annotation of repurchase by the vendor a
retro, but the title has NOT been cleared of the
encumbrance
- NOT a purchaser in good faith because he has notice
that some other person has a right/interest in the
property
Adverse claim or lis pendens previously annotated on title of
property sold
- Subsequent sale of land CANNOT prevail over an
annotated adverse claim which was previously
annotated in the title of the property
- Prior judicial determination of adverse claim is NOT
required before it can flaw the title
- The annotation of an adverse claim is to protect the
interest of a person over a piece of real property, and
serves as a notice to third parties
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- Jurisprudence--a buyer was not an innocent purchaser
for value when it ignored the lis pendens annotation on
the title
- It another case, it was also held that a buyer cannot be
considered aware of the flaw that invalidates his claim
when the same annotation is ordered to cancelled at the
time of the purchase
- A recorded conveyance is constructive notice to the
whole world of its contents, interests, and everything
included therein
- Thus, one who deals w/ property covered by a
title with an annotation of levy or attachment
CANNOT invoke the rights of a purchaser in
good faith
Purchaser examined only the latest certificate of title
- SUFFICIENT/ENOUGH that he examines the latest
certificate of title
- NOT bound by the original, but by the title of the person
who conveyed the property to him
- Presumption: the transferee of registered land is not
aware of any defect in the title of the property he
purchased
ii. rules under Article 1544
a) movables
– “possession”; how acquired (see Art. 559)
b) immovables (Registration of Immovable Sold)
meaning of “registration”
- Any entry made in the books of the Registry of Property
which records solemnly and permanently the right of
ownership and other real rights
- Includes both registration in its ordinary and strict
sense and cancellation, annotation, and even marginal
notes
- Under PD 1529, land bought under Torrens system are
registered lands; land not registered under the Torrens
system are unregistered lands
- Art. 1544 does NOT apply to unregistered land
- Registration in Registry of Property is the operative act
to convey or affect the land insofar as third persons are
concerned
- Sale of registered land that was not registered w/
Register of Deeds will NOT prevail over subsequent sale
registered in good faith by the 2nd buyer
- Register of deeds is required to keep a primary entry
book in which he shall enter in the order of their
reception, all instruments relating to registered land
(instrument is registered from the time so noted by the
register)
- Mere registration is not enough, GOOD FAITH must
concur w/ registration (i.e. w/o knowledge of the
previous alienation by the vendor to another)
- Registration in bad faith = no registration at all
Requirement of “Good Faith”
- Good or bad faith is only relevant where ​the subject of
the sale is ​registered land ​and the purchase was made
from the registered owner whose title to the land is
clean
- Presumption is that the transferee of the registered land
is not aware of any defect in the title of the property he
bought
1. Good faith of the first buyer
- Prius tempore, patior jure ​(First in
time, stronger in right)

- Good faith of the first buyer subsists
despite subsequent discovery of the
second sale
- Knowledge of the first buyer of
second sale does not defeat his right
- X: when second buyer
registers first in GF
2. Good faith of the second buyer
- Clean title of the second buyer is
premised on the ​ignorance of the
rights of the first buyer
- An action to quiet title must
be instituted to determine
which has the better right
over the land in question
- Second buyer must show that he
acted in good faith when he acquired
and registered the land
- From the time the second buyer
learns of the cloud on his title, he is
thereafter construed in bad faith
- That is, if he continues to
possess of thereafter
alienates the land despite
knowing that there exists a
cloud on his title
3. Burden of proof
- One who alleges that one is an
innocent purchaser for value (IPFV)
must prove the same
- Not enough to invoke the
ordinary/legal presumption of good
faith → must be proven
4. Purchase must be for valuable
consideration
- “Purchaser in good faith” = one who
buys property of another, without
notice that another person has a
right/interest in the same and thus
pays a full and fair price therefor
5. Actual knowledge
- Subsequent knowledge of the second
buyer of the existence of the rights of
the first buyer defeats the former’s
rights even if he is the first to register
- Such knowledge thereafter
taints his
registration/possession
with bad faith
6. Duty of purchaser to look beyond the
certificate
- GR: A buyer ​may just rely on the
Torrens title ​and is ​not required to
inquire any further into the title if it
seems that the same is clean/not
suspicious
- X: If there exist facts that
would make any reasonable
man wary, the prospective
buyer should first
investigate
- A purchaser in good faith of
registered land ​acquires a good title
against all transferees whose rights
are ​not recorded ​in the ROD at the
time of sale
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- Banking and financial institutions
are expected to exercise a higher
degree of care in ascertaining the
status of the seller’s/mortgagor’s
title or the condition of the property
- Business is ​affected with
public interest
- Once banking/financial
institutions have shown
that they have satisfactorily
exercised the diligence
required of them, they can
be considered as ​innocent
purchasers for value
7. Property purchased already peaceably
possessed by another
- Failure of a prospective buyer to take
such precautions in purchasing
property = negligence → precludes
him from invoking the rights of an
IPFV
- Absence of such inquiry
would remove him from the
realm of ​bona fide
acquisition
– meaning of “possession”
- Includes both actual and constructive delivery
- Art. 1498 - sale made thru public instrument equivalent
to delivery
– meaning of “oldest title”
iii. applicability of Art. 1544 to unregistered lands
GR: 1544 does NOT apply to sales involving unregistered
lands
- Issue of good faith or bad faith of the buyer is only
relevant in sales involving registered lands with a clean
title
- The purchaser who relies on the clean title of the
registered owner is a purchaser in good faith for value
- Act No. 3344 applies to sales of unregistered lands--the
registration of documents affecting unregistered land is
w/o prejudice to a third party with a better right
- The mere registration of a sale in one’s favor
does not give him any right over the land if the
vendor was not anymore the owner of the land
- Sec. 113 (Act No. 3344)--“no deed, conveyance,
mortgage, lease, or other voluntary instrument affecting
land not registered under the Torrens System shall be
valid, except as between the parties thereto, unless such
instrument shall have been recorded in the Register of
Deeds for the province or city where the land lies...It
shall be understood that any recording made under this
section shall ​be without prejudice to a third party with a
better right.”
- Registration is given SOME priority, provided
that no other party has a better right
Sale of unregistered land
- GR: The first buyer would have the better right
- The vendor does NOT have the right to sell the property
anymore because he is no longer the owner (once he
sells it to the first buyer), so even if the second buyer
has the conveyance (deed) notarized, this is null and
void
- Nemo dat quod non habet--one cannot give what one
does not have
 6
iv. Article 1544 and execution sales
Unregistered land subsequently registered Registered Land
- Situation: the land was unregistered at the first sale but - Registration under the Torrens system is the operative
was already registered at the time of the second sale act that gives validity to the transfer, or creates a lien
- GR: Second buyer prevails if he registered the sale in - A purchaser is NOT required to go beyond the registry
good faith with the Register of Deeds, notwithstanding to determine the conditions of the property; and he
the fact that the first buyer may have recorded the sale acquires the rights, title, and interest as stated in the
under Act No. 3344 certificate of title, subject to the liens, encumbrances
and burdens annotated thereon
Preference of levy of execution or attachment over prior
unregistered land Unregistered Land
- Levy on execution or attachment duly registered takes - Art. 1544 does not apply where the second buyer
preference over a prior unregistered sale acquires the unregistered parcel of land at an execution
- Even if the prior unregistered sale is subsequently sale.
registered before the sale on execution is made, the - Reason: purchaser of unregistered land at a sheriff’s
validity of the execution sale should be maintained execution sale only steps into the shoes of the
because it retroacted to the date of the levy judgement debtor, and merely acquires the latter’s
interest in the property sold as of the time the property
Other Rulings On Applications of Rules was levied upon. (specifically provided by Sec. 33 of
1. Subsequent mortgage registered under Act. 334 Rule 39 of ROC).
- Unrecorded sale of a house of a prior date is preferred
to a recorded mortgage of the same house of a later date Unregistered Land subsequently registered
- Reason: If the original owner had parted with his - If sale in favor of first buyer was executed before land
ownership of the thing sold, then he no longer had the was registered, while the conflicting sale in favor of
ownership and full disposal of that thing so as to be able second buyer was executed after the same property had
to mortgage it. been registered → what should determine the issue are
- Registration of mortgage under Act 334 is WITHOUT the provisions of the last paragraph of Sec. 33, Rule 39
prejudice to the better right of 3rd parties of the ROC
2. Pacto de retro sale - Second buyer who purchased the land when it was
- Not applicable to a case which involves an earlier pacto already registered and who registered the sale in good
de retro sale of an unregistered land and subsequent faith will prevail over the first buyer who purchased the
donation by the vendor a retro to another who sold it to land when it was still unregistered.
a 3rd party while the property was still in the
possession of the vendee a retro who has already
acquired title before the donation because of a failure of
the vendor a retro to repurchase the same
- There being no title to the property which the vendor a
retro could convey to the supposed donee (because no
longer owner thereof), no title could be conveyed by the
donee by the sale of the property.
3. Subsequent mortgage of land registered under the torrens
system, registered by mortgagee
- The registered right of GSIS as mortgagee of the
property was held inferior to the unregistered right of
M, the previous buyer, the unrecorded sale between M
as the vendee and Z, the original owner, is preferred
- Reason: If Z had parted with his ownership of the land
sold, then he no longer had ownership and free disposal
of the same as to be able to mortgage it
4. Sale to financial institution qualified as innocent
purchaser for value
- When financial institutions exercise ​extraordinary
diligence in determining the validity of the certificates
of title to properties being sold or mortgaged to them
and still fail to find any defect or encumbrance upon
the subject properties after said inquiries​​, such
financial institution ​should be protected like any
other Innocent Purchaser for Value if they paid full
and fair price at the time of the purchase or before
having notice of some other person’s claim in the
property
- A financial institution is not expected to check the
technical description of each and every title in the RD
in order to determine whether there is another title to
the property.