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LTD FINALS

Certificate of Title

Torrens title - the certificate of ownership issued under the Torrens system of registration by the government, thru
the Register of Deeds naming and declaring the owner in fee simple of the real property described
therein, free from all liens and encumbrances except such as may be expressly noted thereon or
otherwise reserved by law.

Certificate of title - is the transcript of the decree of registration made by the Register of Deeds. Once issued, the
certificate is the evidence of the title which the owner has. The official certificate will always
show the status of the title and the person in whom it is vested.

Kinds of Certificates of Title

Original Certificate of Title – is the first title issued in the name of a registered owner by the Register of Deeds
covering a parcel of land which had been registered under the Torrens System, by virtue of
judicial or administrative proceeding.

Transfer Certificate of Title – is the title issued by the RD in favor of a transferee to whom the ownership of the
registered land has been transferred by virtue of a sale or other modes of conveyance.

Indefeasibility of a free patent title

An original certificate of title issued on the strength of a homestead patent partakes of the
nature of a certificate of title issued in a judicial proceeding, as long as the land disposed of is
re- ally part of the disposable land of the public domain and becomes indefeasible and
incontrovertible upon the expiration of one year from the date of promulgation of the order of
the Director of Lands for the issuance of patent.

Process in the entry of initial certificate of title

- 15 days from entry of judgment, issue an order directing the administrator of land to issue
corresponding decree of registration and certificate of title.
- The clerk of court shall send, within fifteen days from entry of judgment, certified copies of
the judgment and of the order of the court directing the Administrator to issue the
corresponding decree of registration and certificate of title, and a certificate stating that
the decision has not been amended, reconsidered, nor appealed, and has become final.
- Thereupon, the Administrator shall cause to be prepared the decree of registration as well
as the original and duplicate of the corresponding original certificate of title, and where the
property covered is conjugal, the same must be in the names of both spouses. The original
certificate of title shall be a true copy of the decree of registration.
- The decree of registration shall be signed by the Administrator, entered and filed in the
Land Registration Authority.
- The original of the original certifi cate of title shall also be signed by the Administrator and
shall be sent, together with the owner’s duplicate certifi cate, to the Register of Deeds of
the city or province where the property is situated for entry in his registration book.(LEGAL
BASIS: SECTION 39 OF PD 1529)

Certificate as evidence of title

- A Torrens certificate is the best evidence of ownership of registered land


- Unless bad faith can be established on the part of the person appearing as owner on the
certificate of title, there is no other owner than that in whose favor it has been issued.
- A mortgagee has the right to rely on what appears in the certificate of title, and in the
absence of anything to excite suspicion is under no obligation to look beyond the certificate
and investigate the title of the mortgagor appearing on the face of the certificate.

Who has right to possess owner’s duplicate certificate?

- Section 41 of Act No. 496, as amended by P.D. No. 1529, provides that the owner’s
duplicate certificate shall be issued by the Register of Deeds in the name of the person in
whose favor the land was decreed, and further disposes that said duplicate shall be
delivered to the registered owner.

Land registered in the name of two different persons

- The general rule is that in the case of two certificates of title, purporting to include the
same land, the earlier in date prevails, whether the land comprised in the latter certificate
be wholly, or in part, comprised in the earlier certificate.

- Incidentally, where two transfer certificates of title happen to be issued on different dates
to two different persons covering the same parcel of land, even if both owners be
presumed to be title holders in good faith, it does not necessarily follow that the one who
holds the earlier title should prevail. On the assumption that there was regularity in the
process of registration leading to the eventual issuance of such transfer certificates, it
would be a better procedure to trace back their individual original certificates from which
they were derived.

Protection of innocent third person

- Every person dealing with registered land may safely rely on the correctness of the
certificate of title issued therefor and the law will in no way oblige him to go behind the
certificate to determine the condition of the property.
- The remedy of the defrauded party is to bring an action for damages against those who
caused the fraud or were instrumental in depriving him of the property.
- It was held that a mortgagee has the right to rely on what appears in the certificate of title,
and, in the absence of anything to excite suspicion, is under no obligation to look beyond
the certificate and investigate the title of the mortgagor appearing on the face of said
certificate.

Good faith, how determined

- It has been held that a purchaser in good faith is one who buys the property of another
without notice that some other person has a right to or interest on such property and pays
a full and fair price for the same at the time of such purchase or before he has notice of the
claim or interest of some other person in the property. It is enough that he examines the
latest certificate of title which was issued in the name of the immediate transferor.
- It implies freedom from knowledge and circumstances which ought to put a person on
inquiry.

Registration without effect unless made in good faith

- When one purchases property with full knowledge that his vendor has previously sold the
property to another person, he acquires only the right, if any, which the vendor then had.
- The Torrens system of land registration, though indefeasible, should not be used as a
means to perpetuate fraud against the rightful owner of real property.
- Mere registration of sale is not good enough, good faith must concur with registration.
Otherwise registration becomes an exercise in futility.

Holder in bad faith, not protected

- One who builds a house on another’s registered land believing this to be his own registered
lot, because he did not investigate properly, is held to be a builder in bad faith. He is
deemed to have a presumptive knowledge of the pertinent Torrens title covering the
particular land, the area involved, and the extent of its boundaries.

Co-owners entitled to separate certificates

- If two or more persons are registered owners, one owner's duplicate certificate may be
issued for the whole land, or if the co-owners so desire, a separate duplicate may be issued
to each of them in like form, but all outstanding certificates of title so issued shall be
surrendered whenever the Register of Deeds shall register any subsequent voluntary
transaction affecting the whole land or part thereof or any interest therein. (Sec. 41. PD
1529)

Sale by co-owners

- Under Article 493 of the Civil Code, the owner of an undivided interest in the property has
the right to freely sell and dispose of only his rights, participation and interest in an
undivided property held in common with others, but has no right to sell a specific part, by
metes and bounds, of the property.

Registration of sale with right of legal redemption

- For the purposes of registering a deed of sale, which may be subject to a right of legal pre-
emption or redemption that may be exercised within thirty days from the date of written
notice by the vendor, it is now directed by Article 1623 of the New Civil Code that such
deed of sale be not recorded in the Registry of Property, unless accompanied by an affidavit
of the vendor that he has given written notice thereof to all possible redemptioners.

Consolidation of titles

- Upon petition by a registered owner of two or more parcels of land distinctly described in a
certificate of title, the Register of Deeds may cancel the certificate and issue in lieu thereof
several new certificates each covering one or such number of parcels as the owner may
desire, without the necessity of obtaining a prior authority of the court.
- A registered owner of several distinct parcels of land described in separate certificates of
title may, if he desires, cause that all his certificates be cancelled and in lieu thereof a single
certificate be issued for the different portions thereof, by direct application to the Register
of Deeds.

Title to street areas not subject to sale as residential lots

- When street areas are marked in a subdivision for the use of the public in general and the
purchasers of the residential lots therein in particular, the subdivision owner cannot sell
them for any other purpose without violating the contract or understanding with the
purchasers of the residential lots therein.
Torrens title binds the land to system forever

- The obtaining of a decree of registration and the entry of a certificate of title shall be
regarded as an agreement running with the land, and binding upon the applicant and all
successors in title, that the land shall be and always remain registered land, and subject to
the provisions of Act No. 496 and all acts amendatory thereof.

Torrens title not subject to prescription

- By express provision of Section 47 of P.D. No. 1529, no title to registered land in derogation
to that of the registered owner shall be acquired by prescription or adverse possession.
Prescription is unavailing not only against the registered owner but also against his
hereditary successors because the latter merely step into the shoes of the decedent by
operation of law and are merely the continuation of the personality of their predecessor in
interest.
- A title once registered cannot be defeated, even by adverse, open, and notorious
possession. Registered title under the Torrens system cannot be defeated by prescription.
The title, once registered, is notice to the world. All persons must take notice. No one can
plead ignorance of the registration.

Right to recover possession equally imprescriptible

- To a registered owner under the Torrens system, the right to recover possession of the
registered property is equally imprescriptible, since possession is a mere consequence of
ownership. And if prescription is unavailing against the registered owner, it must likewise
be unavailing against the latter’s hereditary successors, because they merely step into the
shoes of the decedent by operation of law

Torrens title not subject to collateral attack

- Torrens title can be attacked only for fraud, within one year after the date of the issuance
of the decree of registration. Such attack must be direct, and not by a collateral proceeding.

Sale of wife of her portion in conjugal property void

- The wife cannot sell her portions in lands standing in the name of her husband, even if said
portion were assigned to her in a partition of their conjugal property made during the
marriage, for in the absence of an express declaration in the marriage settlement, the
separation of property between spouses during the marriage shall not take place save in
virtue of a judicial order.96 Consequently, the character of these portions of lands as
conjugal partnership property has never changed.

CASES:

Hortizuela vs. Tagufa

Civil Law; Land Titles and Deeds; Principle of Indefeasibility of Titles; The Supreme Court (SC) is not unmindful of the
principle of indefeasibility of a Torrens Title and Section 8 of Presidential Decree (PD) No. 18 where it is provided that
a certificate of title shall not be subject to collateral attack.—The Court is not unmindful of the principle of
indefeasibility of a Torrens title and Section 48 of P.D. No. 1528 where it is provided that a certificate of title shall not
be subject to collateral attack. A Torrens title cannot be altered, modified or cancelled except in a direct
proceeding in accordance with law. When the Court says direct attack, it means that the object of an action is to
annul or set aside such judgment, or enjoin its enforcement. On the other hand, the attack is indirect or collateral
when, in an action to obtain a different relief, an attack on the judgment or proceeding is nevertheless made as an
incident thereof.

Same; Same; Certificates of Title; Registration of a piece of land under the Torrens System does not create or vest
title, because it is not a mode of acquiring ownership.—The fact that Gregoria was able to secure a title in her name
does not operate to vest ownership upon her of the subject land. “Registration of a piece of land under the Torrens
System does not create or vest title, because it is not a mode of acquiring ownership. A certificate of title is merely
an evidence of ownership or title over the particular property described therein. It cannot be used to protect a
usurper from the true owner; nor can it be used as a shield for the commission of fraud; neither does it permit one
to enrich himself at the expense of others. Its issuance in favor of a particular person does not foreclose the
possibility that the real property may be co-owned with persons not named in the certificate, or that it may be held
in trust for another person by the registered owner.”

Same; Same; Reconveyance; The remedy of reconveyance, based on Section of Presidential Decree (PD) No. 19 and
Article 1, prescribes in ten (10) years from the issuance of the Torrens title over the property.—The remedy of
reconveyance, based on Section 53 of P.D. No. 1529 and Article 1456, prescribes in ten (10) years from the issuance
of the Torrens title over the property.

Casimiro Development Corporation vs. Mateo

Land Registration; Land Titles; Torrens System; The Torrens system gives the registered owner complete peace of
mind, in order that he will be secured in his ownership as long as he has not voluntarily disposed of any right over the
covered land.—There is no doubt that the land in question, although once a part of the public domain, has already
been placed under the Torrens system of land registration. The Government is required under the Torrens system
of registration to issue an official certificate of title to attest to the fact that the person named in the certificate is
the owner of the property therein described, subject to such liens and encumbrances as thereon noted or what
the law warrants or reserves. The objective is 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. The
Torrens system gives the registered owner complete peace of mind, in order that he will be secured in his ownership
as long as he has not voluntarily disposed of any right over the covered land.

Same; Same; Same; Registration under the Torrens system, not being a mode of acquiring ownership, does not create
or vest title; The Torrens certificate of title is merely an evidence of ownership or title in the particular property
described therein.— Registration under the Torrens system, not being a mode of acquiring ownership, does not
create or vest title. The Torrens certificate of title is merely an evidence of ownership or title in the particular
property described therein. In that sense, the issuance of the certificate of title to a particular person does not
preclude the possibility that persons not named in the certificate may be co-owners of the real property therein
described with the person named therein, or that the registered owner may be holding the property in trust for
another person.

Same; Same; Same; Registration of land under the Torrens System, aside from perfecting the title and rendering it
indefeasible after the lapse of the period allowed by law, also renders the title immune from collateral attack.—
Moreover, the respondent’s suit is exposed as being, in reality, a collateral attack on the title in the name of Laura,
and for that reason should not prosper. Registration of land under the Torrens System, aside from perfecting the
title and rendering it indefeasible after the lapse of the period allowed by law, also renders the title immune from
collateral attack. A collateral attack occurs when, in another action to obtain a different relief and as an incident
of the present action, an attack is made against the judgment granting the title. This manner of attack is to be
distinguished from a direct attack against a judgment granting the title, through an action whose main objective is to
annul, set aside, or enjoin the enforcement of such judgment if not yet implemented, or to seek recovery if the
property titled under the judgment had been disposed of.
Same; Same; Same; One who deals with property registered under the Torrens system need not go beyond the
certificate of title, but only has to rely on the certificate of title.—One who deals with property registered under the
Torrens system need not go beyond the certificate of title, but only has to rely on the certificate of title. He is
charged with notice only of such burdens and claims as are annotated on the title. The pertinent law on the matter
of burdens and claims is Section 44 of the Property Registration Decree.

Same; Same; Same; The presence of anything that excites or arouses suspicion should then prompt the vendee to look
beyond the certificate and to investigate the title of the vendor appearing on the face of said certificate.—The
vendee’s notice of a defect or flaw in the title of the vendor, in order for it to amount to bad faith, should encompass
facts and circumstances that would impel a reasonably cautious person to make further inquiry into the vendor’s
title, or facts and circumstances that would induce a reasonably prudent man to inquire into the status of the title of
the property in litigation. In other words, the presence of anything that excites or arouses suspicion should then
prompt the vendee to look beyond the certificate and to investigate the title of the vendor appearing on the face
of said certificate.

Locsin vs. Hizon

Civil Law; Sales; Innocent Purchaser for Value; Words and Phrases; An innocent purchaser for value is one who buys
the property of another without notice that some other person has a right to or interest in it, and who pays a full and
fair price at the time of the purchase or before receiving any notice of another person’s claim.—An innocent
purchaser for value is one who buys the property of another without notice that some other person has a right to or
interest in it, and who pays a full and fair price at the time of the purchase or before receiving any notice of another
person’s claim. As such, a defective title –– or one the procurement of which is tainted with fraud and
misrepresentation –– may be the source of a completely legal and valid title, provided that the buyer is an innocent
third person who, in good faith, relied on the correctness of the certificate of title, or an innocent purchaser for
value.

Same; Same; Same; Mirror Doctrine; The mirror doctrine echoes the doctrinal rule that every person dealing with
registered land may safely rely on the correctness of the certificate of title issued therefor and is in no way obliged to
go beyond the certificate to determine the condition of the property.—Complementing this is the mirror doctrine
which echoes the doctrinal rule that every person dealing with registered land may safely rely on the correctness of
the certificate of title issued therefor and is in no way obliged to go beyond the certificate to determine the
condition of the property. The recognized exceptions to this rule are stated as follows: [A] person dealing with
registered land has a right to rely on the Torrens certificate of title and to dispense with the need of inquiring further
except 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.
The presence of anything which excites or arouses suspicion should then prompt the vendee to look beyond the
certificate and investigate the title of the vendor appearing on the face of said certificate. One who falls within the
exception can neither be denominated an innocent purchaser for value nor a purchaser in good faith and, hence,
does not merit the protection of the law.

De Guzman vs. Agbagala

Land Registration; A decree of registration or patent and the certificate of title issued pursuant thereto may be
attacked on the ground of falsification or fraud within one year from the date of their issuance, which attack must be
direct and not by a collateral proceeding.—A decree of registration or patent and the certificate of title issued
pursuant thereto may be attacked on the ground of falsification or fraud within one year from the date of their
issuance. Such an attack must be direct and not by a collateral proceeding. The rationale is this: x x x [The] public
should be able to rely on a registered title. The Torrens System was adopted in this country because it was believed
to be the most effective measure to guarantee the integrity of land titles and to protect their indefeasibility once the
claim of ownership is established and recognized.

Same; Words and Phrases; The attack is direct when the object of the action is to annul or set aside such judgment, or
enjoin its enforcement, and the attack is indirect or collateral when, in an action to obtain a different relief, an attack
on the judgment is nevertheless made as an incident thereof.—An action is deemed an attack on a title when the
object of the action or proceeding is to nullify the title and thus challenge the judgment pursuant to which the title
was decreed. The attack is direct when the object of the action is to annul or set aside such judgment, or enjoin its
enforcement. On the other hand, the attack is indirect or collateral when, in an action to obtain a different relief,
an attack on the judgment is nevertheless made as an incident thereof. In the present case, the attack on OCT No.
P-30187 was merely collateral because the action was principally for the declaration of nullity of the deed of
donation and the other deeds of conveyance which followed.

Same; Principle of Indefeasibility of Title; The principle of indefeasibility does not apply when the patent and the title
based thereon are null and void—an action to declare the nullity of a void title does not prescribe and is susceptible
to direct, as well as to collateral, attack; The settled rule is that a free patent issued over a private land is null and
void, and produces no legal effects whatsoever—the Director of Lands has no authority to grant free patent to lands
that have ceased to be public in character and have passed to private ownership.—The principle of indefeasibility
does not apply when the patent and the title based thereon are null and void. An action to declare the nullity of a
void title does not prescribe and is susceptible to direct, as well as to collateral, attack. OCT No. P-30187 was
registered on the basis of a free patent which the RTC ruled was issued by the Director of Lands without authority.
The petitioners falsely claimed that the land was public land when in fact it was not as it was private land previously
owned by Carmen who inherited it from her parents. This finding was affirmed by the CA. There is no reason to
reverse it. The settled rule is that a free patent issued over a private land is null and void, and produces no legal
effects whatsoever. Private ownership of land―as when there is a prima facie proof of ownership like a duly
registered possessory information or a clear showing of open, continuous, exclusive, and notorious possession, by
present or previous occupants―is not affected by the issuance of a free patent over the same land, because the
Public Land law applies only to lands of the public domain. The Director of Lands has no authority to grant free
patent to lands that have ceased to be public in character and have passed to private ownership. Consequently, a
certificate of title issued pursuant to a homestead patent partakes of the nature of a certificate issued in a judicial
proceeding only if the land covered by it is really a part of the disposable land of the public domain.