LAND REGISTRATION CASE DIGEST

THIRD SET IN LTD

(EDITED BY: ALYSSA AFRICA)

SUBMITTED TO:
ATTY. ERWIN TIAMSON

SUBMITTED BY:
CANDELARIA, MICHELLE DULCE (CASES 1 AND 2)
LAGUNILLA, KARL (CASES 3 AND 4)
DAPITIN, JEN KCIN (CASES 5 AND 6)
AFRICA, ALYSSA (CASES 7 AND 8)
ARCE, AYA (CASES 9 AND 10)
RASING, PAUL MARVIN (CASES 11 AND 12)
TOTANES, TANIA (CASES 13 AND 14)
HERNANDEZ, CARMI (CASES 15 AND 16)
ARCOL, EDMARK (CASES 17 AND 18)
ELAURIA, CARLOTA (CASES 19)
RUBA, ERICSON (CASE (20)(NHA) and (21) DBP)
ESPIRITUO, GLEN(CASE (22))
PERLAS, VAN REGINE (CASES (23) and (24))
VILLANUEVA, RIGEL (CASES (25) and (32))
CANUA, MA. ERLINORE (CASES 20(26))
DELA CRUZ, ARIS (CASES 21 (27), 22 (28) AND 49(54))
CO, PATRICK (CASES 23 (29) AND 24 (30))
SARSOSA, ROCHELLE MARIE (CASES 26(35) AND 36(43))
AMBAS, KATRINA MARIE (CASES 24(33) AND 25(31))
CORPUZ, IVY (CASES 27(36) AND 28 (37))
VILLENA, ROXANE MAE (CASES 29(38))
QUE, JARRED (CASES 30(39))
CAPPAL, JAISE (CASES 31(40) AND 34(41))
AGTARAP, AXEL (CASE 35(42))
ROBLES, KENNETH (CASES 37(44) AND 38(45))
MATEO, RAEMOND (CASES 39(46) and 40(47))
CABBUAG, (CASES 42(48), AND 43(49))
CAPINO, JAC (CASES 45 (50) AND 46(51))
RENOVALLES, MARA (CASE 47(52))
VELASCO, MA. BLESILDA (CASE 48(53))
1. Lee Tek Sheng v. Court of Appeals

Facts:
After his mother’s death, petitioner Leoncio Lee Tek Sheng filed a complaint against his
father (private respondent) for the partition of the conjugal properties of his parents. The private
respondent alleged that the 4 parcels of land registered in petitioner’s name are conjugal
properties. The Private Respondent contends that the lots were registered under Leoncio’s
name only as a trustee because during the registration, Leoncio was the only Filipino in the
family. Respondent prayed for the dismissal of the partition case and for the reconveyance of
the lots to its rightful owner – the conjugal regime. To protect the interest of the conjugal regime
during the pendency of the case, the Private Respondent caused the annotation of a notice of
lis pendens on TCT 8278. Petitioner moved for the cancellation of said annotation but it was
denied by RTC on the grounds that: (a) the notice was not for the purpose of molesting or
harassing petitioner and (b) also to keep the property within the power of the court pending
litigation. CA affirmed the decision. Hence, this petition.

ISSUE: Whether or not the TCT named after the registrant is a conclusive proof of ownership

HELD:
No. Petitioner’s claim is not legally tenable. Placing a parcel of land under the Torrens
System does not mean that ownership thereof can no longer be disputed. Ownership is different
from a certificate of title. The TCT is only the best proof of ownership of a piece of land.
Besides, the certificate cannot always be considered as conclusive evidence of ownership.
Registration is not the equivalent of title, but is only the best evidence thereof.

Title as a concept of ownership should not be confused with the certificate of title as evidence of
such ownership although both are interchangeably used. Registering land under the Torrens
System does not create or vest title, because registration is not a mode of acquiring ownership.
A certificate of title is merely an evidence of ownership or title over a particular property
described therein.

While the Certificate of Title may be considered as a best proof of ownership, the mere issuance
thereof does not foreclose the possibility that the property may be under co-ownership with
persons not named in the certificate or the registrant may only be a trustee or that the other
parties may have acquired interest subsequent to the issuance the Certificate of Title. In this
case, contrary to petitioner’s fears, his certificate of title is not being assailed by private
respondent. What the latter disputes is the former’s claim of sole ownership.

Thus, although petitioner’s certificate of title may have become incontrovertible one year after
issuance, yet contrary to his argument, it does not bar private respondent from questioning his
ownership.

On the contention that ownership cannot be passed upon in partition case, suffice it to say that
until and unless ownership is definitely resolved, it would be premature to effect partition of the
property.
For purposes of annotating a notice of lis pendens, there is nothing in the rules which requires
the party seeking annotation to prove that the land belongs to him.

Besides, an action for partition is one case where the annotation of a notice of lis pendens is
proper. Hence, the petition is denied and SC affirmed the CAs decision.
2. Baranda vs. Judge Gustillo

Facts:
A parcel of land designated as Lot No. 4517 of the Cadastral Survey of Sta.
Barbara, Iloilo covered by original certificate of title no. 6406 is the land subject of the dispute
between petitioner (Eduardo S. Baranda and Alfonso Hitalia) and respondents(Gregorio Perez,
Maria Gotera and Susan Silao). Both parties claimed ownership and possession over the said
land. However during the trial, it was found that the transfer certificate of title held by
respondents was fraudulently acquired. So the transfer certificate of title was ordered to
be put in the name of petitioners. In compliance with the order or the RTC, the Acting Register
of Deeds Avito Saclauso annotated the order declaring TCT T-25772 null and void, cancelled
the same and issued new certificate of titles in the name of petitioners. However, by reason of a
separate case pending in the Court of Appeals, a notice of lis pendens was annotated in the
new certificate of title. This prompted the petitioners to move for the cancellation of the notice of
lis pendens in the new certificates. Judge Tito Gustilo then ordered the Acting Register of
Deeds for the cancellation of the notice of lis pendens but the Acting Register
of Deeds filed a motion for reconsideration invoking Sec 77 of PD 1529.

ISSUE: What is the nature of the duty of the Register of Deeds to annotate or annul a
notice of lis pendens in a Torrens certificate of title?

Held:
Judge Gustilo abused his discretion in sustaining the Acting Register of Deed’s stand
that the notice of lis pendens cannot be cancelled on the ground of pendency of the case in the
Court of Appeals. The function of the Register of Deeds with reference to the registration of
deeds, encumbrances, instrument and the like is ministerial in nature. The acting register of
deeds did not have any legal standing to file a motion for reconsideration of the Judge’s
Order directing him to cancel the notice of lis pendens.

Sec. 10 of PD 1529 states that:

“It shall be the duty of the register of deeds to immediately register an instrument presented for
registration dealing with real or
personal property which complies with all the requisites for registration.

I f t h e instrument is not registerable, he shall forthwith deny registration thereof and inform the
presentor or such denial in writing, stating the ground and reasons therefore, and advising him
of his right to appeal by consulta in accordance with Sec 117 of this decree.” On the
other hand, Sec 117 of PD 117 states that: “When the Register of Deeds is in doubt with
regard to the proper step to be taken or memoranda to be made in pursuance of any
deed, mortgage or other instrument presented to him for registration or where any party in
interest does not agree with the action taken by the Register of Deeds with reference
to any such instrument, the question shall be submitted to the Commission of Land
Registration by the Register of Deeds, or by the party in interest thru the Register of Deeds.
3. Almirol vs. The Register of Deeds of Agusan

Facts:
On June 28, 1961, petitioner Almirol purchased from Arcenio Abalo a parcel of land
situated in the municipality of Esperanza, province of Agusan, and covered by original certificate
of title in the name of "Arcenio Abalo, married to Nicolasa M. Abalo." Sometime in May, 1962,
Almirol went to the office of the Register of Deeds of Agusan in Butuan City to register the deed
of sale and to secure in his name a TCT. Registration was refused by the respondent.
Respondent contends that the property was registered as conjugal property and that since the
wife has already died when the sale was made, the surviving husband cannot dispose of the
whole property without violating the existing law. Respondent further contends that to effect the
registration of the deed of absolute sale, it is necessary that the property be first liquidated and
transferred in the name of the surviving spouse and the heirs of the deceased wife by means of
extrajudicial settlement or partition and that the consent of such other heir or heirs must be
procured by means of another document ratifying this sale executed by their father.

In view of such refusal, Almirol went to the CFI of Agusan on a petition for mandamus, to
compel the respodent to register the deed of sale and to issue to him the corresponding TCT.
Petitioner asserted that it is but a ministerial duty of the respondent to perform the acts required
of him, and that he has no other plain, speedy and adequate remedy in the ordinary course of
law. In his answer, the respondent averred that the petitioner has other legal, plain, speedy and
adequate remedy at law by appealing the decision of the respondent to the Honorable
Commissioner of Land Registration, and prayed for dismissal of the petition. The lower court
ruled in favor of respondent declaring that “the adequate remedy is that provided by Section 4 of
Rep. Act 1151". Petitioner filed an appeal and hence, this petition.

Issue: Whether or not the petition for mandamus has merit to compel the respondent to register
the deed of sale in question.

Held:
No. Whether a document is valid or not, is not for the register of deeds to determine as
this function belongs properly to a court of competent jurisdiction. Moreover, a register of deeds
is entirely precluded by section 4 of RA 1151 from exercising his personal judgment and
discretion when confronted with the problem of whether to register a deed or instrument on the
ground that it is invalid. Under the said section, when he is in doubt as to the proper step to be
taken with respect to any deed or other instrument presented to him for registration, all that he is
supposed to do is to submit and certify the question to the Commissioner of Land Registration
who shall, after notice and hearing, enter an order prescribing the step to be taken on the
doubtful question.

The court correctly dismissed the petition for mandamus. Section 4 of RA 1151 provides
that "where any party in interest does not agree with the Register of Deeds . . . the question
shall be submitted to the Commissioner of Land Registration," who thereafter shall "enter an
order prescribing the step to be taken or memorandum to be made," which shall be "conclusive
and binding upon all Registers of Deeds." This administrative remedy must be resorted to by the
petitioner before he can have recourse to the courts.
4. Gabriel vs. Register of Deeds of Rizal
Facts: On January 4, 1960, petitioner Gabriel filed with the Register of Deeds of Manila an
adverse claim against the properties registered in the name of oppositor-appellant, Juanita R.
Domingo, her sister. She alleges that the same properties have been included in the amended
inventory of the estate of the late Antonia Reyes Vda. de Domingo, as they are in fact properties
acquired by the deceased during her lifetime. Moreover, she claims that the registration of these
properties should have been made in the name of the deceased, but through fraud and deceit,
by said Juanita R. Domingo, all the properties were registered instead in her name, thus
depriving the petitioner as an heir of the deceased of her lawful rights and interests over said
properties. On the same date, a similar notice of adverse claim was presented by petitioner with
the Register of Deeds of Rizal, on the said properties.

For the adverse claim on the Manila properties, Domingo presented an opposition,
claiming that the Adverse claim was instituted for harassment; had no legal basis; and had done
and will do irreparable loss her. The Register of Deeds of Manila, elevated the matter to the
Land Registration Commission en Consulta, wherein he stated: “because the undersigned is in
doubt as to whether the registration of the claim is proper determination by this Commission.”
Domingo also asked that the adverse claim of Gabriel on her Rizal properties be denied. On
January 13, 1960, the Register of Deeds of Rizal denied registration of the Notice of Adverse
Claim, asserting that the notice of adverse claim has been found to be legally defective or
otherwise not sufficient in law. Gabriel appealed the denial to the Land Registration
Commission. The LRC ruled that the notices of verse claim filed by petitioner with the Registries
of Manila and Rizal are registrable.

Domingo moved for a reconsideration of the rulling, contending that a Register Deeds
exercises some degree of judicial power to determine upon his own responsibility, the legality of
instruments brought before him for registration. In other words, Domingo submits that the duties
of the Register of Deeds are not wholly ministerial, for they can refuse, and/or suspend the
registration of documents when they think they are not valid or not registrable. LRC denied the
motion. Domingo appealed.

Issue: Wether or not the duty of the Register of Deeds is purely ministerial.

Held: Yes. It should be observed that section 110 of Act No. 496, which is the legal provision
applicable to the case, is divided into two parts: the first part refers to the duty of the party who
claims any part or interest in registered land adverse to the registered owner, subsequent to the
date of the original registration; and the requirements to be complied with in order that such
statement shall been titled to registration as an adverse claim, thus showing the ministerial
function of the Register of Deeds, when no defect is found on the face of such instrument;
and the second applies only when, after registration of the adverse claim, a party files an
appropriate petition with a competent court which shall grant a speedy hearing upon the
question of the validity of such adverse claim, and to enter a decree, as justice and equity
require; and in this hearing, the competent court shall resolve whether the adverse claim is
frivolous or vexatious, which shall serve as the basis in taxing the costs. In the instant case, the
first part was already acted upon by the L.P.C. which resolved in favor of the registrability of the
two adverse claims and this part should have been considered as closed. What is left, is the
determination of the validity of the adverse claims by competent court, after the filing of the
corresponding petition for hearing, which the appellant had not done.

The Land Registration Commission did not state that it was mandatory for a Register of
Deeds to register invalid or frivolous documents, or those intended to harass; it merely said that
whether the document is invalid, frivolous or intended to harass, is not the duty of a
Register of Deeds to decide, but a court of competent jurisdiction, and that it is his concern
to see whether the documents sought to be registered conform with the formal and legal
requirements for such documents.
5. Obras Pias vs. Devera Ignacio
6. Egao vs. Court of Appeals

Facts:
The respondents filed a motion for quieting the title and recovery of possession and
ownership against the petitioners. Apparently, they claim they are the owners of the parcel of
land by virtue of the deed of sale they entered into with Roberto Marfori to whom the petitioners
allegedly sold their land to. The Egaos acquired their land title by virtue of a free patent and
transferred their ownership in favor of Marfori by virtue of a deed of sale. However, the
Certificate of Title was not transferred in Marfori’s favor. Upon purchase of the land from Marfori,
the respondents introduced improvements thereon and paid taxes for the property. However,
the petitioners illegally occupied portions of the land. Petitioner answers that they are the true
owner of the land by virtue of the Certificate of Title issued by the Register of Deeds pursuant to
their Free Patent. The lower court ruled in favor of Egao. Upon appeal, the CA reversed the
decision of the lower court on grounds that the main issue should be whether Egao can validly
sell the land to Marfori who subsequently transferred the ownership to the respondents. The CA
holds both Egao and Marfori to be in pari delicto for violating the 5-year restriction provided by
Commonwealth 141 against encumbrance and alienation of public lands acquired thru free
patent or homestead patent. They cannot therefore obtain affirmative relief. It also declares the
respondents as innocent purchasers for value who the obtained the duplicate of the OCT still in
the name of the Egaos from Marfori and ownership was transferred to them by physical
possession of the property. It thus promulgated judgment holding the respondents the absolute
owners of the land in dispute, to cancel the OCT of the petitioner and its transfer thereof to the
respondents and to surrender peaceful possession of the land to the respondents.

Issue: Whether or not the petitioners validly transferred their ownership to Marfori to resolve the
rights of the respondents over the land in dispute

Held:
The SC holds that based on the adduced evidence, the Egaos sold the lot to Marfori
within the 5-year restriction period provided by law on Free Patent based on the Deed of Sale
entered into by the parties. Although the petitioners denied the validity of the Deed of Sale the
court held that it was notarized and a notarial document has in its favor the presumption of
regularity. When the land was sold to the respondents, they know that the OCT is still registered
under the name of the petitioners. Thus, they are not considered to be innocent purchaser as
contrary to the ruling of the CA. Where a purchaser neglects to make the necessary inquiries
and closes his eyes to facts which should put a reasonable man on his guard as to the
possibility of the existence of a defect in his vendor's title, and relying on the belief that there
was no defect in the title of the vendor, purchases the property without making any further
investigation, he cannot claim that he is a purchaser in good faith for value. A private individual
cannot bring an action for reversion or any action which would have an effect of canceling a free
patent and the certificate of title issued on the basis thereof since the land covered will form part
again of the public domain. Sec. 124 of the Public Land Act provides that deeds of sale of
patented lands, perfected within the prohibited five (5) year period are null and void thus the
Egaos have no title to pass to Marfori and nobody can dispose that which does not belong to
him. The respondents are not innocent purchasers for value with no standing to question the
rights of the petitioners over the land and to file an action to quiet the title. The petitioners
remained to be the registered owners and entitled to remain in physical possession of the
disputed property. Respondents are ordered to deliver the OCT to the petitioners without
prejudice to an action for reversion of the land to be instituted by the Solicitor General for the
State.
7. Sajonas vs. Court of Appeals

Facts:
On September 22, 1983, spouses Ernesto Uychocde and Lucita Jarin entered into a
contract of sale over a residential land in Antipolo Rizal in favor of spouses Alfredo Sajonas and
Conchita Sajonas. The Sajonas spouses agreed to pay the same in installment basis under
their Contract to Sell. On August 27, 1984, the Sajonas spouses caused the annotation of their
adverse claim based on the contract to sell. On September 4, 1984, the Uychocdes spouses
executed a Deed of Sale after receiving the full payment of the purchase price from the Sajonas
spouses. It was registered on August 28, 1985.

Meanwhile, Domingo Pilares filed a Civil Case for the collection of sum of money against
Ernesto Uychocde. On June 25, 1980 they instead entered into a compromise agreement
wherein Uychocde is to pay him the amount of P27,800 within two years from June 25, 1980.
When he failed to pay, Pilares moved for the issuance of a writ of execution, and it was granted
on August 3, 1982. Pursuant to the issue, Sheriff Roberto Garcia of Quezon City presented the
notice of levy on execution to the Register of Deeds of Marikina on February 12, 1985. The
same was annotated at the back of the TCT. On August 28, 1985, the TCT was cancelled and a
new TCT was issued to the Sajonas spouses but the notice of levy on execution was carried
over to the new title.

The Sajonas spouses filed a complaint and demanded that the notice of levy on
execution be cancelled on the ground that the property was already transferred, conveyed and
assigned to them, and that there are no more rights or interests to be levied upon. The trial court
rendered judgment in their favor on the ground that actual notice of an adverse claim is
equivalent to registration, but it was reversed in the Court of Appeals.

Issue: Whether or not the Sajonas spouses have a better right over the property.

Held:
Yes, the Sajonas spouses have a better right over the property. According to the
Supreme Court, Section 70 of PD 1529 must not be construed to mean that the effectivity of a
statement of adverse claim is effective only for a period of 30 days. It must be understood that
what the law meant was that beyond the thirty day period, the annotation continues to be in
effect, otherwise the law would not have included that the claim may be cancelled after the
lapse of the period upon filing of a verified petition by the party in interest as such would be a
useless provision. Furthermore, to render such application would not fulfill its purpose of
protecting the interest of a person over the real property and warning third parties of an existing
claim or interest similar or better than the right of the registered owner of the land.

Hence, it must be held that the annotation of an adverse claim still remains in effect on
February 12, 1985 when the Sheriff annotated notice of levy on execution. It therefore prevails
over the latter. Judgment is reversed.
8. Aznar Brothers Realty vs. Court of Appeals

Facts:
A lot with an area of 34,325 square meters was located in Brgy. Mactan, Lapu-Lapu City
was obtained by Aznar from the heirs of Crisanta Maloloy-on through an Extrajudicial Partition
of Real Estate with Deed of Absolute Sale on March 3, 1964. It was registered on March 6,
1964 and was thereafter, declared by Aznar for purposes of taxation. The heirs, however, were
still occupying portions of the land by mere tolerance and under the condition that they would
leave should Aznar use the property. Later on, Aznar entered into a joint venture with Sta. Lucia
Realty Development Corporation for a housing subdivision and beach resort to be developed
over the subject property. Aznar demanded them to vacate the property, but they refused. Aznar
filed a case against them for unlawful detainer with the MTC.

On the other hand, the heirs claimed that they had been occupying the property as
owner since the time of their parents and grandparents. They claimed that the Extrajudicial
Partition of Real Estate with Deed of Absolute Sale must be rendered void ab initio for being
simulated and fraudulent. They likewise filed a case to declare the document null and void with
the RTC.

The MTC rendered a decision in favor of Aznar and was affirmed by the RTC. In the
Court of Appeals however, the decision was reversed on the ground that the heirs were in
peaceful, continuous, adverse and notorious possession of the property since time immemorial.

Issue: Whether or not the Aznar has a better right over the property.

Held:
Yes, the Aznar has a better right over the property in question. Aznar’s claim is anchored
on the validity of the Extrajudicial Partition with Deed of Absolute Sale and in this case, the court
believes that such is valid. It must be noted that an Extrajudicial Partition with Deed of Absolute
Sale is a notarized document. Hence it is favored with the presumption of regularity and carries
evidentiary weight and it is up to the heirs to prove otherwise. In this case, the heirs over the
property provided no proof to their allegations that the contract is fraudulent, nor that the parties
to the deed of sale were not legally capable of entering into a contract due to death and
minority.

In addition, the principle that registration is the operative act that gives validity to the
transfer or creates a lien upon the land refers only to cases involving conflicting rights over
registered property and those of innocent transferees who relied on the clean title of their
properties and has no bearing in this case as there was no proof that the heirs sold it to anyone
else other than Aznar.

Hence, the Aznar must be deemed the lawful owner of the land. The judgment is
reversed.
9. Estrellado vs. Martinez

Facts:

Proceso Martinez, the defendant, filed an application for the registration of property with the
Court of First Instance of Tayabas, wherein he alleged that he is the sole owner of the property to be
registered. The property in question was previously owned by the deceased mother of the petitioner,
Vivencia Estrellado, a minor. She was not named in the said application, and her father, Eleuterio
Estrellado, was not notified that there was an existing action for registration. Thus, an order of
general default was rendered for lack of opposition on the part of the Estrellados, and upon finality of
the order, the decree was issued to Martinez. Vivencia, who later on found out about the order, then
filed a motion praying for the review of the order, since she claimed that the decree was obtained by
Martinez through the use of fraud. The motion was denied, since the order already became final.
She then sought relief by filing an action for damages amounting to Php 2,000.00, which was
granted by the judge but was reduced to Php 600.00 only, corresponding to the value of the property
in question.

Issue: Whether or not Estrellado is entitled to payment of damages for the deprivation of her land by
Martinez, even though the latter is in possession of a Torrens title

Held:

Yes. The Land Registration Law specifically provides that a person who has been unlawfully
deprived of his land, without his negligence, and despite of the fact the he may no longer recover the
land in question or the interests therein, may file an action for damages in a court of competent
jurisdiction, without prejudice to the action that he may bring against the person who caused the said
deprivation. The proceeding for the registration is in rem. It is an assertion of legal title. The prime
purpose of registration is certainty and incontestability in titles to land. In a lesser degree, the
purpose is the facilitation of the proof of titles and the transfer thereof. This harshness of the law is
tempered by the provisions (eg. Sections 38, 55, 101, and 102) which allow a deprived party to
recover damages, not only from the party who registered the property, but also from the assurance
fund created under the law, even though the title to the land is already incontestable.

The deprived party must only show that: 1.) that the person is in reality wrongfully deprived of
his land by the registration in the name of another of the land by actual or constructive fraud, 2.) that
there was no negligence on his part, 3.) that he is not barred or in any way precluded from bringing
an action for the recovery of the land or interest therein, and 4.) that the action for compensation has
not prescribed. In this case, the petitioner has satisfied the said requisites. It was proven that she
was actually deprived of her land by way of constructive fraud (since Martinez did not act with the
intention to deceive and was not dishonest, but applicant Martinez did make a mistake of fact to the
prejudice of another), and she exercised diligence in prosecuting her action. Moreover, she
exhausted all the remedies required prior to under the Land Registration Law, and her claim is not
barred by the statute of limitations.
10. Gatioan vs. Gafud

Facts:
Petitioner Encarnacion Gatioan bought a parcel of land originally registered in the name
of Rufino Permison, who acquired it on the basis of a free patent. Gatioan had the Original
Certificate of Title of the land cancelled, in lieu of a Transfer Certificate of Title issued in his
name. The land in question was then mortgaged three times for three different loans acquired
by her from the Philippine National Bank. Upon the payment of her last loan, she did not
execute any instrument to discharge the encumbrance on her TCT. Meanwhile, the defendants,
Sixto Gaffud and Villamora Logan, also acquired a free patent over the same land as Gatioan,
and an OCT was issued in their favor. They obtained two loans from PNB, and they used the
land as collateral.
The Secretary of Agriculture and Natural Resources was able to compare the petitioner’s
TCT and the defendants’ OCT, and he found out that the titles cover only one and the same
parcel of land. He then ordered the cancellation of the second title. Gatioan filed a complaint for
quieting of title, and a judgment was rendered in her favor. The defendant bank filed an appeal
questioning the part of the judgment stating that the mortgage executed by Gaffud and Logan
was null and void and unenforceable, and claiming that the bank is a mortgagee in good faith
and for value. PNB sought to have the annotation of the mortgage on the OCT of Gaffud and
Logan to be carried over to the TCT of Gatioan as an encumbrance.

ISSUE:
Whether or not the bank may benefit from the provisions of Act No. 496 regarding the
protection for innocent purchasers of land

HELD:
No, it may not. Act No. 496, or the Land Registration Act, provides in Sections 38, 56,
and 112 of Act No. 496 that the vendee may acquire rights and be protected against the
defenses which the vendor would not. However, these provisions do not apply to the appellant
PNB because it cannot claim that it is a bona fide purchaser/mortgagee who had no knowledge
of the existence of the flaws in the defendants’ title, as compared to the petitioner’s title. When a
conveyance has been properly recorded, such record is constructive notice of its contents and
all interests, legal and equitable, included therein. The conveyance is recorded in the public
registry, and it is never issued unless and until it is recorded. Thus, it serves as a notice to the
world that such land is registered, and it is presumed that a purchaser has examined every
instrument of record affecting the title of the land he purchased. This presumption is not
rebuttable; otherwise, the very purpose of the system providing for records of conveyance will
be negated.
In this case, PNB failed to exercise a higher degree of diligence in granting the loans of
the parties, as well as in checking the mortgaged properties and the titles thereto. The petitioner
already mortgaged the property three times; it should have noticed that the defendants’
mortgaged property was exactly the same as that of the petitioner’s. Under the circumstances,
appellant had absolutely no excuse for approving the application of the defendant spouses and
giving the loans in question.
11. Reyes vs. Noblejas

Facts:
An appeal by certiorari to review the resolution of the Land Registration Commissioner
dated August 25, 1964 — ordering the Register of Deeds of Rizal to deny registration of the
Deed of Sale and the Affidavit of Consolidation of Ownership presented to him by herein
petitioner.
It appears from the facts of record that the spouses Leonardo Gamboa and Aurora L. Cariaga
are the registered owners of the properties covered by Transfer Certificates of Titles Nos.
18230, 18231, 18232, 18233 and 18234, of the Registry of Deeds of Rizal. These properties
were mortgaged to the Philippine National Bank and upon the failure of the mortgagors to pay
the amount of the indebtedness upon maturity, the mortgage was foreclosed extrajudicially
under the provisions of Act No. 3135, as amended.
The mortgaged properties were sold at a public auction for the sum of P 6,100.00 in favour of
Arsenio Reyes. In said certificate, the period of redemption of the property shall be one year
after the sale.
On February 10, 1964, there were presented for registration in the Registry of Deeds of Rizal,
an Affidavit of Consolidation of Ownership executed on February 8, 1964, by the auction-
vendee, Arsenio Reyes, and a Deed of Sale executed by the Philippine National Bank as
attorney-in-fact of the mortgagee (sic), in favor of the auction-vendee, Arsenio Reyes. But was
subsequently denied by the Register of deeds on the ground that the redemption period has not
yet expired. Hence this petition

Issue: Whether or not the period of redemption of properties sold at public auction pursuant to
an extrajudicial foreclosure of real estate mortgage under Act No. 3135, as amended by Act No.
4118, is to be counted from the date of the execution of the certificate of sale by the sheriff, or,
from the date of registration of the corresponding certificate of sale issued by the sheriff in the
Office of the Register of Deeds concerned.

Held:
We are not impressed by the argument. Apparently, herein petitioner failed to see the "other
side of the coin" and overlooked the doctrine, also well settled, that the registration required by
Section 50 of the Land Registration Law is intended primarily for the protection of innocent third
persons, i.e., persons who, without knowledge of the sale and in good faith, have acquired lights
to the property.[[2]] The same protection to third parties is obviously one of the objects of Section
27, Rule 39 of the Revised Rules of Court in requiring that the certificate of sale issued by the
sheriff in an auction sale be registered in the office of the register of deeds, for the purpose of
the legislature in providing for our present system of registration is to afford some means of
publicity so that persons dealing with real property may reach the records and thereby acquire
security against instruments the execution of which has not been revealed. Redemption is not
the concern merely of the auction-vendee and the mortgagor, but also of the latter's successors
in interest or any judicial creditor or judgment creditor of said mortgagor, or any person having a
lien on the property subsequent to the mortgage under which the property has been sold. It is
precisely for this reason that the certificate of sale should be registered, for only upon such
registration may it legally be said that proper notice, though constructive, has been served unto
possible redemptioners contemplated in the law. We have to conclude, therefore, that the date
of sale mentioned in Section 6 of Act 3135, as amended, should be construed to mean the date
of registration of the, certificate of sale in the office of the register of deeds concerned. Only
after the lapse of the twelve-month redemption period from the date of registration of the
certificate of sale and in the absence of any redemptioner within the said period, may the deed
of final sale be executed in favor of the purchaser who may then consolidate the title of the
property in his favor. Consequently, We have to declare that the Land Registration
Commissioner was right in ordering the Register of Deeds of Rizal to deny the registration of the
Deed of Sale and the Affidavit of Consolidation of Ownership, the simultaneous registration of
which documents was sought by herein petitioner even before the certificate of sale issued by
the sheriff was registered.
12. Agbulos vs. Alberto

Facts:
By virtue of a writ of execution issued by the Court of First Instance of Manila on March
16, 1959 in Civil Case No. 18644 entitled Jose Agbulos, plaintiff, vs. Jose C. Alberto, defendant,
the rights, interests and participation of the latter in a parcel of land covered by Transfer
Certificate of Title No. 24643 of the land records of Manila were levied upon. After due
proceedings the corresponding execution sale thereof was made on June 15, 1959, with herein
appellant Agbulos (judgment creditor in the case) as the highest bidder. The officer who made
the sale issued the certificate of sale on July 8, 1959 and the same provided that "The
redemption of the above described property from the purchaser may be made at any time within
twelve (12) months after the sale.
On June 23,1960 appellee paid the sheriff of Manila with a sum of P 6,670.00 for the
redemption of the property and said officer executed in his favor on the same date the
responding certificate of redemption.
It appears that on the same date (June 23, 1960) appellant filed with the Sheriff of Manila a
verified request for the execution and delivery to him of the final deed of sale upon the ground
that the judgment debtor not redeemed the property within the period of one year after the sale.
On June 29 of the same year the Sheriff replied that he could not accede to the request, giving
the following as his reasons for the denial: (a) that the certificate of sale in favor of appellant
was registered only on July 18, 1959, for which reason the period of redemption commenced to
run only from such date; and (b) that the judgment debtor had deposited on June 23, 1960, that
is, before the expiration of the one-year period of redemption the total sum of P6,670.00 in full
redemption of property.
In view of the action of the Sheriff, appellant filed a civil case praying for an order of annulling
the certificate of redemption, but was denied by the lower court, hence this petition.

Issue: Whether or not the lower court erred that the period of redemption commenced to run
only from the deed of the registration of the certificate of sale

Held: Section 26, Rule 39 of the Rules of Court provides that "the judgment debtor, or
redemptioner, may redeem the property from the purchaser, at any time within twelve
months after the sale" (Emphasis supplied) without specifying whether the period should start
from (1) the date when the execution sale was made, or (2) from the date when the certificate of
sale was executed by the sheriff who made the sale, or (3) from the date when said certificate of
sale was registered in the office of the corresponding register of deeds.
Aside from what has been said heretofore, appellant now estopped from claiming that the one-
year period redemption started earlier than the date when the certificate of sale was registered,
for the reason that he failed timely to question the entry or annotation made on the back of the
certificate of title of the property he had purchased, to the effect that the sale thereof in his favor
was subject to redemption within one year from the registration of said certificate of sale.
13. Liong-Wong-Shih vs. Sunico and Peterson

FACTS:
This was an action brought by the Liong-Wong-Shih against the defendant to have declared null
and void certain attachments issued in favor of the defendant by the Court of First Instance of the
city of Manila, and levied upon certain property alleged to belong to the Liong-Wong-Shih. Two
attachment orders were issued against 1⁄2 of a certain piece of property situated in the district of
Binondo, City of Manila. As to the first attachment, the latter could not be noted in the Registry
of Deed for the reason that it was not then registered. On the second order of attachment, the
property was then duly noted in the Registry of Deeds. Each of said orders of attachment was
levied by the sheriff of the city of Manila.

ISSUE:
Whether or not the purchaser of a land, who fails to have his title deeds recorded in the proper
registry of property, can be relieved from attachment liens created or placed upon said property
subsequent to his purchase of such property.

HELD:
The record is incomplete — it does not show in which registry the title was registered; whether
under the registry provided for by the Mortgage Law or whether under the system of registration
provided for by the Philippine Commission. The record brought does not disclose in which
record the title was recorded, whether in the view or the old, or whether the sale of such land was
made to the plaintiff herein before or after the application the former to have his title recorded
under the acts of the Commission. The case was remanded to the lower court for a new trial.
14. Tabigue vs. Green

FACTS:
Potenciana Tabigue sold the land in controversy to Frank Green by an absolute deed. Frank
Green wrote a letter in which he stated that the deed he already had from the plaintiff would not
be sufficient and that it would be necessary for Tabigue to sign another deed after the registration
had been made in her favor. After the land was registered to Tabigue, a new certificate of
ownership was executed and delivered to the Frank Green, certifying that he was the sole owner
of the property. However, the attorney for Potenciana Tabigue made a written offer to Green to
redeem the property but Green refused to permit the redemption, and he executed a deed of the
land to the military government and sent the same to Manila to be forwarded to Washington.

HELD:
The Court ordered the defendant to transfer his title on the premises in controversy to Tabigue, to
register the land in the name of the plaintiff, and deliver the title of the same to her. It
contemplated the surrender of the original certificate whenever the land is transferred from one
person to another, and the Court believed that the judgment should specifically order the
defendant to deliver that certificate for cancellation.
15. Buzon vs. Licauco

FACTS:
This is an action filed enjoining defendants to proceed with an execution sale claiming
that the petitioner is the true owner of the land in question and was not informed of any
encumbrance. On 15 Dec 1904, a certificate of title to a parcel of land was issued pursuant to a
decree of the Court of Land Registration to Rafael Herrera. Thereafter, Maximo Licauco
instituted an action against Herrera in the CFI obtaining an order of attachment against the
property which was levied on 1 Oct 1907 by filing and registering a copy of the order in the
office of the Register of Deeds. Apparently, it appears that Herrera had executed a separate
deed of sale of the land in question to Lucio Buzon duly notarized on 6 Sept 1907 and was
presented to the register of deeds on 4 Oct 1907 or 4 days after the attachment proceedings
was filed by Licauco. The office of the register of deeds of Manila issued a certificate of transfer
of title to the land in question containing the annotation of the order of attachment filed by
Licauco in its memorandum of encumbrances.
In view of this, Licauco insisted the alleged sale to Buzon was a simulated and not a genuine
sale and that the right of ownership was not conveyed by Herrera as the certificate of title held
by Buzon was obtained by fraud. He claims that he had duly filed and recorded his order of
attachment four days prior to the issuance of Buzon's certificate of transfer and title hence this
certificate should not be permitted to defeat his right to subject the property in question to
execution.

ISSUE: Whether or not an unrecorded deed of conveyance executed by the owner of the land
unregistered under the provisions of the Land Registration Act conveys title and ownership to
the Buzon?

HELD:
No, the deed of sale of Herrera to Buzon did not take effect as conveyance or bind the
land until 4 Oct 1907 or the date of registration to the Register of Deeds and that the levy of
Licauco’s attachment against the land effected on 1 Oct 1907 is valid and existing as of that
date.
Section 50 of the Land Registration Act provides that no deed, mortgage, lease, or other
voluntary instrument, except a will, purporting to convey or affect registered land, shall take
effect as a conveyance or bind the land, but shall operate only as a contract between the
parties, unless and until the act of registration is complete as provided by Section 51 of the
same act. Once registered, any conveyance, mortgage, lease, lien, attachment, order, decree,
instrument or entry, affecting registered land recorded, filed or entered in the office of the
register of deeds will then serve as a notice to all persons from the time of such registering,
filing or entering.
Buzon in this case had both actual and constructive notice of the fact that the attachment had
been levied upon the land purchased by him before he became the owner, and clearly he not
entitled to an injunction to restrain Licauco from subjecting this land to execution.
16. Tuason vs. Raymundo

FACTS:
On 3 Mar 1913, Vicenta Rodriguez and Gregorio Baroto Cruz owned parcels of land
subject to a loan from Alfonso Dubrunner and sold the land in question to Julia Tuazon who
immediately possessed the property and leased it to Trinidad Maranga. Later, Maranga was
ousted by the sheriff of Manila under an action for execution procured by Faustino Raymundo.
Raymundo argued that on 1 May 1911 he purchased the property in question under a pacto de
retro with a one-year redemption period. Although no redemption was made, Raymundo
extended the redemption period without fixing a limit to the extension. The sale with the right to
repurchase was not registered in the registry of property and no attempt was made to register it
until the 9 June 1913.
It appears that Rodriguez and Cruz sold the same property to two different individuals being
with the right to repurchase and to the Tuazon on the 3 of Mar 1913. The sale to Raymundo
was not registered and no entry was made either upon the certificate of title held by the original
owners or in the registry of property while the sale to the Tuazon although made two years later
was duly registered.

ISSUE: Whether or not an unregistered transfer of the property invalidates and provides a better
title over real property over a subsequent transfer registered under the Torrens system made for
value and in good faith?

HELD:
No. In accordance to Sec 50 of Act No 496, the act of registration shall be the operative
act to convey and affect the land and no deed, mortgage, lease, or other voluntary instrument,
except a will, purporting to convey or affect registered land, shall effect as a conveyance or bind
the land or transfer title, but shall operate only as a contract between the parties.
In effect, the conveyance from Rodriguez and Cruz to the Raymundo in 1911 amounted simply
to a contract for a conveyance which would become a valid conveyance when it was registered
in accordance with the requirements of Act No. 496. Being nothing more than a contract for the
sale of land, it had no effect upon the purchase made by the Tuazon in 1913, she having bought
for value and in good faith and her conveyance having duly registered as required by law.
17. Sikatuna vs. Guevarra
FACTS:
A contract of lease of a portion of land in Calle Bilbao, Manila measuring about 100
square meters, was entered into between the partnership Jacinto, Palma y Hermanos, as
lessor, and Potenciana Guevara, as lessee, which land is a part of the land belonging to the
said partnership. The said contract contained an option in favor of the partnership Jacinto,
Palma y Hermanos by which the latter, within one year from the date of the execution thereof,
could purchase the house of Potenciana Guevara built on the land so leased. However, if within
said time the said partnership did not exercise such option, Guevara would have the right to
purchse the land leased to her.

The time for the option having expired, without the partnership having exercised its right, the
defendant attempted to purchase the said land, to which the former objected which prompted
Guevara to bring an action against the said partnership to compel it to sell the land to her.

While the action was pending, the aforesaid partnership sold to the Sikatuna corporation all the
land including the portion leased to Guevara, which corporation recorded the transfer in the
registry under the provisions of Act No. 496. As a result, transfer certificate of title No. 8651 was
issued to the said corporation.

When judgment was rendered in the case filed by Guevara against the partnership, the trial
court ordered the latter to sell to the former the portion of land leased to her. The contract
entered into between Sikatuna and Messrs. Jacinto Palma y Hermanos was thereby declared
rescinded.

ISSUE: W/N the rescission of the contract of sale between Sikatuna and the partnership was
valid.

HELD:
The rescission of the said sale does not lie because the property is now in the legal
possession of a third person who has not acted in bad faith. The second paragraph of article
1295 of the Civil Code provides as follows:

Neither shall rescission take place when the things which are the subject-matter of the
contract are lawfully in the possession of third persons who have not acted in bad faith.

There is no doubt but that in this case the plaintiff corporation has the character of a third
person, and it has not been shown that it had acted in bad faith.

This case has a special circumstance in that it deals with property registered under the Land
Registration Act, No. 496, section 79 of which provides that actions concerning properties
registered under the law shall affect only the parties litigant, unless a notice of the
commencement of the action is recorded, which does not appear to have been done in the case
before us. There was, therefore, no legal obstacle to the transfer of the title of the said property,
and for this special reason the said transfer cannot be rescinded.
18. Worcester vs. Ocampo
FACTS: By virtue of an execution issued out of the Court of First Instance of Manila dated
January 26, 1910 in Case No. 6930 (Dean C. Worcester vs. Martin Ocampo), all the right, title
and interest of the latter in two parcels of land registered in his name were levied upon for the
purpose of satisfying a judgment of P60,000, a notice of the levy in said case having been
entered upon the back of the certificates of title on the same date, January 26, 1910.

By a document dated January 11, 1909 or prior to said attachment, the two parcels mentioned
were sold con pacto de retracto by Martin Ocampo to Gervasio Ocampo y Reyes, for the period
of four years from said date, the vendor being allowed the right to continue occupying the said
properties by paying an annual rental of P150. This document was endorsed on the back of said
certificates of title on February 1, 1910.

By another writ of execution, issued on March 26, 1910, in the same Case No. 6930, all the
right, title and interest of the defendant, Martin Ocampo, in the two properties which had been
levied upon, were sold at public auction and Dean C. Worcester, as the highest bidder,
purchased the same, subject to the right of redemption which the law allows to judgment
debtors; this sale was also noted on the back of said certificates of title on April 11, 1910.

The period of redemption having expired without the judgment debtor having exercised his right,
the sheriff of Manila executed in favor of the purchaser, Worcester, an absolute deed of sale of
all the right, title and interest of Martin Ocampo in the two parcels above mentioned, which had
been sold at public auction.

ISSUE: W/N an absolute deed of sale executed by the sheriff of Manila to Dean C. Worcester
should be registered in the latter's name.

HELD: Treating of property registered under the Torrens system, as in the present case, and
under Act No. 496, the deed of sale con pacto de retracto executed by Martin Ocampo in favor
of Gervasio Ocampo produced no effect whatsoever as a deed of such transfer (nor was it an
encumbrance on the property, but only constituted a contract between the parties and as
authority for the register of deeds to make the corresponding inscription), except from the
moment of its filing or registration, that is to say, from the first day of February, 1910. As on a
date prior to the first day of February, 1910 which is January 26 of said year, the final levy on
said properties in favor of Dean C. Worcester, had already been noted which notice produced all
the effects prescribed in section 51 of Act No. 496, it been the final levy, by virtue of which the
public auction was conducted and the sheriff having executed the deed of sale in favor of
Worcester, it is evident that the said levy and sale made by the sheriff takes precedence over
the deed of sale con pacto de retracto executed by Martin Ocampo in favor of Gervasio
Ocampo y Reyes.

Sections 50 and 51 of Act No. 496, provide:

SEC. 50. An owner of registered land may convey, mortgage, lease, charge, or
otherwise deal with the same as fully as if it had not been registered. He may use forms
of deeds, mortgages, leases, or other voluntary instruments like those now in use and
sufficient in law for the purpose intended. But no deed, mortgage, lease, or other
voluntary instrument, except a will, purporting to convey or affect registered land,shall
take effect as a conveyance or bind the land, but shall operate only as a contract
between the parties and as evidence of authority to the clerk or register of deeds to
make registration. The act of registration shall be the operative act to convey and affect
 the land, and in all cases under this Act the registration shall be made in the office of
register of deeds for the province or provinces or city where the land lies.

SEC. 51. Every conveyance, mortgage, lease, lien, attachment, order, decree,
instrument, or entry affecting registered land which would under existing laws, if
recorded, filed, or entered in the office of the register of deeds, affect the real estate to
which it relates shall, if registered, filed, or entered in the office of the register of deeds in
the province or city where the real estate to which such instrument relates lies, be notice
to all persons from the time of such registering, filing, or entering.

Said section 50 clearly provides that when registered land is conveyed, mortgaged, leased, or
otherwise dealth with, such conveyance, mortgage, etc., shall not affect or convey the land until
such conveyance, mortgage, etc., is recorded or filed or entered in the office of the register of
deeds. From said provision it is clear then, that by reason of the fact that the said pacto de
retracto was not recorded, filed, or entered in the office of the register of deeds until after the
plaintiff had secured his lien by attachment, that Gervasio Ocampo y Reyes acquired his right
subject to the rights of the plaintiff herein. His right being subject to the rights of the plaintiff, it
cannot be enforced against the land until after the rights of the plaintiff have been fully satisfied.
No claim is made by the appellant that there were any rights left in said parcel of land over and
above the rights of the plaintiff.

Meanwhile, if every conveyance or attachment when recorded, filed, or entered in the office of
the register of deeds, shall be notice to all persons from the time of such registering, filing or
entering, then Gervasio Ocampo y Reyes cannot plead ignorance of the existence of the rights
acquired by Worcester under his attachment which was duly recorded in the office of the register
of deeds several days before there was any attempt to record or file or register the pacto de
retracto.

In other words, the only interest which he had remaining in the land was the right to repurchase
the same within the period mentioned in said contract and that therefore the only interest which
was sold by the sheriff was the right to repurchase, that being the only right which Martin
Ocampo had in the parcels of land in question at the time of the sheriff's sale.
19. Roxas vs Dinglasan

FACTS
Felisa Kalaw was the registered owner with Certificate of Title over a lot with an area of 26,530
square meters, situated at Lipa City. She sold to Francisca Mojica by means of a public
instrument an undivided portion of 11,530 square meters of the lot. In the same month and year,
she sold to Victoria Dinglasan by means of a private instrument the remaining portion of 15,000
square meters. Long before and at the time of the sales, Francisca Mojica and Victoria
Dinglasan were in possession of the Lot. The vendor's Certificate of Title was not delivered to
the vendees because it was in the possession of another person to whom the lot had been
mortgaged by Felisa Kalaw.
Pedro Dinglasan, by falsifying a public document of conveyance, succeeded in having the title in
the name of Felisa Kalaw canceled and a new transfer Certificate of Title issued in his name.
The record does not show when and how he had obtained possession of the owner's duplicate
certificate of title.
Pedro Dinglasan mortgaged the lot to Leonora T. Roxas as security for a loan. The mortgagor's
title having been delivered to the mortgagee, she caused the instrument to be registered on the
back of the said transfer certificate of title. Leonora T. Roxas then instituted the instant
foreclosure suit against the mortgagor, Pedro Dinglasan, the latter having failed or refused to
pay the obligation on its due date. Said defendant was declared in default.
Francisca Mojica and Victoria Dinglasan moved to intervene. The complaint alleged that they
were the owners of the lot, having purchased the same from Felisa Kalaw, in June 1959; the
title to said land was fraudulently transferred by Pedro Dinglasan in his name; that Pedro
Dinglasan mortgaged the land in favor of plaintiff Leonora T. Roxas; that said mortgagor has
been convicted of "Falsification of Public Document by a Private Individual," and the document
used by him in transferring title in his name was the subject of the said felony.

ISSUE: W/N Mojica and Dinglasan are the rightful owners of the land

HELD:
No. The complaint in intervention was to vindicate ownership of the land in the intervenors. The
deeds of sale involving the parcel of land covered by Certificate of Title No. 9125 in the name of
the vendor, Felisa Kalaw, not having been registered, the said intervenors did not acquire
ownership of the land. It is well settled that in case of sale of a piece of land titled under the
Torrens System, it is the act of registration, and not tradition, that transfers the ownership of the
land sold. (Agbulos vs. Alberto, G.R. No. L-17483, July 31, l962, citing Sec. 50, Act 496; Tuason
vs. Raymundo, 28 Phil. 635; Sikatuna vs. Guevarra, 43 Phil. 371; Worcester vs. Ocampo, 34
Phil. 646.)
The vendees-intervenors not having acquired the ownership of the land, their action to vindicate
ownership must fail because such action can prosper only upon proof by plaintiff that he is the
owner. As pointed out, the intervenors did not acquire ownership of the land because their
deeds of sale were not registered.
14 (20). NHA vs. Basa
15(21). DBP vs. Acting Register of Deeds of Nueva Ecija
16 (22).Government of the Philippine Islands v. Aballe

FACTS:

1 .The provincial sheriff of Occidental Negros levied upon and sold to Levy Hermanos, Inc., all
the rights, interest and participation of Gervasio Ignalaga in lots Nos. 419, 762 and 763.
2 .On March 7, 1933, Levy Hermanos, Inc., filed a petition praying that:
a. the register of deeds be ordered to cancel the certificates of title to these lots in the
name of Gervasio Ignalaga and Petra Maderazo
b. to issue the corresponding transfer certificate of title in the name of Levy Hermanos,
Inc., for the reason that the legal period for redemption has expired with nobody having
exercised this right.
3. The petition was opposed by Antonio Alegato with respect to lots Nos. 762 and 419, claiming
to be the owner thereof for having bought them from their original owners, and by Chiong
Bonco, with respect to lot No. 763, claiming that he held a mortgage credit on this lot.
4. The court overruled all these oppositions, ordered the register of deeds of the Province of
Occidental Negros to cancel the certificates of title covering lots Nos. 419, 762 and 763 of
this cadastral record and issue the transfer certificate of title, free from all aliens and
encumbrance, in favor of Levy Hermanos, Inc.
ISSUE:
Whether or not the claimants, Antonio and Chiong can oppose the effects of notice
attachment to the instruments which was duly inscribed in the books of the registry of
deeds.
HELD:

No, he cannot now oppose the effects of said attachment .Neither his opposition with
respect to lot No. 762 founded, notwithstanding the fact that the notice of attachment had not
been noted on the original certificate of title to this lot in the name of Gervasio Ignalaga and
Petra Maderazo or on the transfer certificate of title which was later issued in his name,
inasmuch as this notice of attachment was duly inscribed in the books of the registry of deeds.
According to section 51 of Act No. 496, the registration of the instrument in the books of the
registry of deeds is notice to all as regards such document. It does not provide that it is the
notation thereof on the certificate of title. And section 56 of the same Act, in prescribing the form
in which the registers of deeds should keep their entry books and directing the entry therein, in
the order of their reception, of all deeds and other voluntary instruments and all copies of writs
and other process filed with them relating to registered land, noting there in the year, month,
day, hour and minute when they received them, provides that inscription or registration shall be
regarded as made from the time so noted. According to this, the notation of the attachment of
this lot in the entry book of the register of deeds produces all the effects which the law gives to
its registration or inscription.
17(23). Bass v. De la Rama
18 (24).Fidelity & Surety Co. vs. Conegero
19 (25). Tenio-Obsequio vs. Court of Appeals

FACTS:
Private respondent Alimpoos filed for a petition of the recovery of a parcel of land
alleging that they mortgaged the land to Eduardo Deguro as a guaranty to a loan, who then,
sold the land to the petitioner. They contended that Deguro prepared the deed of sale without
thir knowledge and consent. The deed of sale was annotated at the back of the certificate title.
By virtue thereof, the Original Certificate Title was cancelled and a Transfer Certificate Title was
issued in favor of Deguro.
ISSUE:
Whether or not the parcel of land can be reconveyed to owner Alimpoos.
HELD:
No. Under Section 55 the Land Registration Act, as amended by Section 53 of
Presidential Decree No. 1529, an original owner, of registered land may seek the annulment of
a transfer thereof on the ground of fraud. However, such a remedy is without prejudice to the
rights of any innocent holder for value with a certificate of title. Petitioner is a purchaser in good
faith.
The main purpose of the Torrens system is to avoid possible conflicts of title to real
estate and to facilitate transactions relative thereto by giving the public the right to rely upon the
face of a Torrens certificate of title and to dispense with the need of inquiring further, except
when the party concerned has actual knowledge of facts and circumstances that should impel a
reasonably cautious man to make such further inquiry. Where innocent third persons, relying on
the correctness of the certificate of title thus issued, acquire, rights over the property, the court
cannot disregard such rights and order the total cancellation of the certificate. 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 beyond the certificate to determine the
condition of property.
20. Potenciano vs. Dineros

FACTS:
Potenciano bought from Gregorio Alcabao a parcel of land and house, as evidenced by
a deed of sale. The following day, Potenciano presented the deed of sale and owner's certificate
of title to the Register of Deeds for registration. The entry was made in the day book and
Potenciano paid the corresponding fees, evidenced by official receipt. However, in entering the
transaction in the entry book, the clerk who made the entry committed an error in copying the
number of the certificate of title. Along with the confusion arising from the bombing of Manila,
the papers presented by Potenciano were either lost or destroyed and were not among those
salvaged. Up to the time when this case was filed, no certificate of title has been issued to the
plaintiff.
Sometime in April, 1946, Dineros sued Alcabao and his son for damages. A writ of
attachment was issued on the property that was sold to Potenciano, it appearing that the
property was still in the name of Alcabao. A third-party claim was filed by Potenciano and the
error in the numbers was explained. Dineros contends that entry of the deed in the day book is
not sufficient registration. Judgment was rendered in favor of the present defendant. The
plaintiff's claim was denied, and so was his claim during the execution sale.

ISSUE: Whether or not the registration made by Potenciano is valid?

HELD:

Yes, registration made by Potenciano is valid. Section 56 of the Land Registration Act says that
deeds relating to registered land shall, upon payment of the filing fee, be entered in the entry
book — also called day book in the same section — with notation of the year, month, day, hour,
and minute of their reception and that "they shall be regarded as registered from the moment so
noted." And applying this provision in the cases of Levin vs. Bass* etc., G. R. Nos. L-4340 to
4346, decided on May 28, 1952, the SC held that "an innocent purchaser for value of registered
land becomes the registered owner and in the contemplation of law the holder of a certificate
thereof the moment he presents and files a duly notarized and lawful deed of sale and the same
is entered on the day book and at the same time he surrenders or presents the owner's
duplicate certificate of title to the property sold and pays the full amount of registration fees,
because what remains to be done lies not within his power to perform."

The judgment creditor may not, as purchaser at the auction sale, invoke the protection accorded
by law to purchasers in good faith, because at the time of the auction he already had notice,
thru the third party claim filed by Potenciano, that the property had already been acquired by the
latter from the judgment debtor.

The Rules of Court provide that a purchaser of real property at an execution sale "shall be
substituted to and acquire all the right, title, interest, and claim of the judgment debtor thereto."
(Rule 39, section 24.) In other words, the purchaser acquires only such right or interest as the
judgment debtor had on the property at the time of the sale. (Cruz vs. Sandoval, 69 Phil. 736;
Barrido vs. Barreto, 72 Phil. 187.) It follows that it at that time the judgment debtor had no more
right to or interest in the property because he had already sold it to another than the purchaser
acquires nothing. Such appears to be the case here, for it is not disputed that years before the
execution sale — and even before the attachment — the judgment debtor had already deeded
the property and delivered his certificate of title to another, who on the following day presented
the deed and certificate of title to the Register of Deeds. In other words, it was registered. And
this act of registration operated to convey the property to the buyer.
21 (27). Heirs of Severa P. Gregorio vs. Court of Appeals, Spouses Tan, et al.

Facts:

1. The Spouses Tan, as private respondents, are registered owners of a certain parcel of lot located
in Quezon City that they claimed to have purchased, in good faith, from a certain private
respondent Ricardo Santos who, in turn, purchased said parcel of lot from Severa Gregorio

2. The Heirs of Severa Gregorio, as petitioners and represented by its administratrix Buenconsejo
de Vivar, challenged the authenticity of said sale between Spouses Tan and Santos with claim
that Severa Gregorio’s signature was forged at the instance of the sale between the former and
Ricardo Santos. This is despite the existence of a registered deed of sale anent to said property

3. The Spouses Tan maintained their position that they acquired said property from Santos free
from any encumbrances

Issue:

Whether said claim of the Heirs of Severa Gregorio will hold water

Held:

The Supreme Court ruled in favor of the Spouses Tan as it delved on the matters connected
with the validity of the sale between the said spouses and Ricardo Santos. It ruled favoring said
authenticity on the following grounds:

 When a portion of registered property was sold and the sale was duly registered (and annotated
in the certificate of title of the vendor), the vendee technically becomes the owner of the sold
portion as of the registration of the sale although the title to said property is still in the name of
the vendor.

 Per established facts connected with cleanliness of the title at the instance of the purchase of
the Spouses Tan (as there was inquiry done with the Registry of Deeds), their good faith concurs
with the said registration of sale, enough to further establish the authenticity of their claim as
legitimate owners of said property
22 (28). Garcia vs. Court of Appeals

Facts:

1. Spouses Magpayo, as private respodents, mortgaged their parcel of land to respondent bank
Philippine Bank of Communications (PBCom), that at the instance of their default was
extrajudicially forclosed by said bank. Subsequently, the same bank bought the same property
via public auction.

2. Jose Ma. T. Garcia, petitioner and brother of the Magpayos, who was in possession of said
property during the issuance of the writ of possession at the instance of PBCom refused to
honor said writ and questioned the authenticity of the claim of PBCom on the point of his claim
that he inherited said property from his mother Remedios T. Garcia, wife of Atty Pedro V. Garcia
who earlier sold said property to the Magpayos. He further allege that during the execution of
said mortgage, the Magpayos were not the owners of said property as their title was issued a
few days later than the resl estate mortgage

3. Respondent Court of Appeals ruled in favor of respondent PBCom on ground that the registered
deed of sale at the instance of said property provides for the authenticity of the ownership at
the instance of the Magpayos despite the fact that the title of the Magpayos to the said
property was issued a few days later than the deed of real estate mortgage

Thus, this case

Issue:

Whether said ruling of respondent Court of Appeals holds water

Held:

The Supreme affirmed the ruling of the Court of Appeals upholding the right of the Magpayos
as owners of said prooerty as it pointed out that:

Registration does not confer ownership, it is merely evidence of such ownership over a
particular property. The deed of sale operates as a formal or symbolic delivery of the property
sold and authorizes the buyer to use the document as proof of ownership.
23 (29). Gonzales vs. IAC
Facts:The spouses Asuncion Sustiguer and Dioscoro Buensuceso were the original owners of
the property subject of this controversy.For delinquency in the payment of the real estate taxes
due thereon, the land was sold at public auction to the Province of Iloilo in 1955.
Hortencia Buensuceso, daughter of said spouses, discovered in the office of the Register of
Deeds of Iloilo that the Certificate of Title of subject land, OCT No. 3351, was still in the name of
her parents. Hortencia paid the back taxes on the land in behalf of her mother in whose favor
the Provincial Treasurer executed a deed of repurchase on April 10, 1969.
On April 17, 1969, the spouses Gaudioso Panzo and Hortencia Buensuceso bought the land
from the latter's mother.
On February 26,1971, a reconstituted original certificate of title was issued in the name of
Asuncion Sustiguer alone. And by virtue of the sale of said property by Sustiguer to the spouses
Panzo, her title was cancelled and in lieu thereof TCT No. T-64807 was issued by the RD of
Iloilo in the spouses' name on March 3, 1971.
The said spouses then mortgaged the property to respondent Rural Bank of Pavia for
P5,000.00. Upon their failure to pay the account, respondent bank foreclosed the mortgage on
August 11, 1973 and the bank was the highest bidder. A certificate of sale was executed by the
Provincial Sheriff in its favor.
On April 18, 1974,Gonzalez as judicial co-administratrix of the Intestate Estate of the late Yusay
filed an action seeking the annulment and cancellation of the title in the name of the Panzos and
the issuance of a new title in favor of Yusay. It alleged among other things: that the subject
property was first mortgaged to Yusay on April 30, 1929 by the spouses Sustiguer and
Buensuceso; that sometime November, 1934, said property was verbally sold to Yusay by the
same spouses; that since Yusay bought the property in 1948, he and his administrator, have
been in possession of the property until April 15, 1971.
Issue: Whether or not the respondent bank was an innocent mortgagee and subsequent buyer
for value in good faith of the property.
Held: Yes. The certificate of title was in the name of the mortgagors when the land was
mortgaged by them to respondent bank. Persons dealing with a registered land has a right to
rely upon the face of the torrens certificate of title and to dispense with the need of inquiring
further, except when the party concerned has actual knowledge of facts and circumstances that
would impel a reasonably cautious man to make such inquiry.

The case which was filed by Gonzalez against the said spouses which he claims should have
put the respondent bank on its guard was annotated at the back of the subject title only on
March 29,1973. Any subsequent lien or encumbrance annotated at the back of certificate of title
cannot prejudice the mortgage previously registered.
24 (30). Pineda vs. Court of Appeals

Facts: On 4 January 1982, Spouses Benitez mortgaged a house and lot covered by TCT 8361
in favor of Pineda and Sayoc. Pineda and Sayoc did not register the mortgage with the Register
of Deeds. The Spouses Benitez delivered the owner’s duplicate of TCT 8361 to Pineda.

On 9 November 1983, with the consent of Pineda, the Spouses Benitez sold the houseMojica.
On the same date, Mojica filed a petition for the issuance of a second owner’s duplicate of TCT
8361 alleging that she "purchased a parcel of land" and the owner’s duplicate copy of TCT No.
T-8361 was lost. The Register of Deeds of Cavite City issued the second owner’s duplicate of
TCT 8361 in the name of the Spouses Benitez.

On 12 December 1983, the Spouses Benitez sold the lot covered by TCT 8361 to Mojica. With
the registration of the deed of sale and presentation of the second owner’s duplicate of TCT
8361, the Register of Deeds cancelled TCT 8361 and issued TCT 13138 in the name of Mojica.
On 22 February 1985, Mojica obtained a loan from Gonzales. Mojica executed a promissory
note and a deed of mortgage over the Property in favor of Gonzales. Gonzales registered this
deed of mortgage with the RD of Cavite City who annotated the mortgage on TCT 13138.
Meanwhile, on 8 May 1985, Pineda and Sayoc filed a complaint before the RTC of Cavite City,
against the Spouses Benitez and Mojica. The complaint prayed for the cancellation of the
second owner’s duplicate of TCT 8361. During the pendency of the case, Pineda caused the
annotation on 18 August 1986 of a notice of lis pendens on the original of TCT 8361 with the
Register of Deeds.
On 7 December 1987, Mojica defaulted in paying her obligation to Gonzales. Hence, Gonzales
extrajudicially foreclosed the mortgage. On 27 January 1988, Gonzales purchased at public
auction the Property. On 30 March 1989, the Register of Deeds of Cavite City cancelled TCT
13138, which was in Mojica’s name, and issued TCT 16084 in the name of Gonzales.
Issue: Whether TCT 13138 and TCT 16084, being derived from the void second owner’s
duplicate of TCT 8361, are also void.
Held: Yes. However, what is void is the transfer certificate of title and not the title over the
Property. The title refers to the ownership of the Property covered by the transfer certificate of
title while the transfer certificate of title merely evidences that ownership. The nullity of TCT
13138 did not affect the validity of the title or ownership of Mojica or Gonzales as subsequent
transferees of the Property.
25 (31). Toledo-Banaga vs. Court of Appeals

Facts: An action for redemption was filed by petitioner Bibilia Banaga when she lost her right to
redeem her property which was foreclosed and subsequently sold at public auction to private
respondent Candelario Damalerio. Certificates of Titles were issued to Damalerio over which
Banaga annotated a notice of lis pendens. On appeal by Banaga, CA reversed the decision of the
trial court and allowed Banaga to redeem the property within a certain period. On 11 June 1992,
Banaga tried to redeem the said property which was financed by her co-petitioner Jovita Tan but
Damalerio opposed the redemption arguing that it was beyond the time given to her by the CA.
Meanwhile, on 7 January 1993, Banaga sold the disputed to her co-petitioner Jovita Tan and
despite the notice of lis pendens, the latter subdivided the property in question under a
subdivision plan. Then on 28 October 1992, CA rendered a decision, declaring Damalerio as the
absolute owner of the disputed property and ordered the Registry of Deeds to issue the respective
certificates of titles, however, said Registry won’t comply with the order because the matter
should be first referred “en consulta” before Banaga’s title can be cancelled and a new one be
issued to Damalerio.

Issue: Whether or not Registry of Deeds’ non compliance with the order of CA is justified and
whether or not Jovita Tan is a buyer in good faith.

Held/Ruling: No. Petitioners’ contention that the execution of the order should be first complied
with by surrendering of the Certificates of Titles for purposes of cancellation thereof per Section
80 of P.D. 1529 bears no merit. Such surrender will constitute of, if not disrespect the orders of
the highest tribunal. Otherwise, if execution cannot be has just because the losing party will not
surrender the titles, the entire proceedings in the courts would be rendered nugatory.

No. Jovita Tan is considered a buyer in bad faith. She was well aware from the start of the notice
lis pendens by reason of furnishing Banaga the amount used in order to redeem the foreclosed
property. Tan cannot feigned ignorance of such, therefore, she is considered as transferee
pendent lite as she stands exactly in the shoes of Banaga and must respect any judgment or
decree which may be rendered for or against Banaga.
23 (32). Bayoca vs. Nogales

FACTS:
When spouses Canino died intestate their children inherited a parcel of land with an area
of 29,645 square meters. In 1951, Preciosa Canino executed a notarized Deed of Sale with
Right to Repurchase in favor of Julia Deocareza for the entire property. The parties agreed that
the land is to be registered under Act 3344. Preciosa Canino failed to repurchase the property.
In 1968, Julia Deocareza entered into a Deed of Absolute Sale where she sold 21,080 square
meters to respondent Gaudioso Nogales. In 1971, the heirs of spouses Canino executed a
Deed of Partition. A cadastral survey was conducted and identified the partition as Lots 676,
670, 668, 669 and 667. Lot 669 was sold to Erwin Bayoca, Lot 671 was sold to Nonito Dichoso
and Lot 667 was sold to Francisco Bayoca.

Nogales filed for Accion Reinvindicatoria with damages. He contended that the
petitioners purchased portions of the property in bad faith and through fraud. Petitioners
insisted that they have a better right over Nogales. Petitioners rely on the on the fact that they
were first to register the sales resulting in the issuance of of new titles under their name.

Issue:
Whether or not petitioners have better right in their claim of ownership.

Held:

No. The registration of the deed of sale, under Act 3344, constitutes constructive notice
of said sale to the whole world. 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 sold. The Deed of Absolute Sale
entered by Diocharesa and Nogales was registered with the Registry of Deeds and entered in
the Registry of Records under Act 3344. Registration by the first buyer under Act 3344 can have
the effect of constructive notice to the second buyer that can defeat his right as such buyer in
good faith.
24 (33). Hanopol vs. Pilapil

Facts: Petitioner Hanopol claims ownership of a parcel of land by virtue of a series of purchases
through private instruments executed by the Siapos in 1938. He further invokes in his favor a
decision rendered by the CFI of Leyte on a complaint he filed on 16 June 1948, against the same
vendors, who, according to his averments, took possession of the land in December 1945 by way
of fraud, threat and intimidation and therefore ejecting his tenants thereon. On the other hand,
respondent Pilapil asserts title over the same property on the basis of a duly notarized deed of
sale executed in his favor by the same vendors on 3 December 1945 which was registered in the
Registry of Deeds of Leyte on 20 August 1948 under Act No. 3344 otherwise known as the
Registration Act.

Issue: Whether or not the registration of the deed of sale made by Pilapil affects the right of
Hanopol as first vendee.

Held/Ruling: Yes. Hanopol’s contention of “better right” as stated from Act No. 3344 is
erroneously applied. There appears no clear evidence of Hanopol’s possession of the disputed
land since the Siapos (vendors) were in possession of the land by the time it was sold to Pilapil.
Furthermore, Hanopol’s contention that the better right of ownership belongs to him is contrary
to what Article 1544 of the New Civil Code states; said article will be futile at all save those
lands or real estate registered under the Spanish Mortgage Law or the Land Registration Act,
ergo, would limit the scope of the said codal provision.

Lastly, as ruled in the case of Lichauco vs. Berenguer, when a person buys a piece of land, and
instead of taking possession of it, leases it to the vendor, possession by the latter after the sale is
possession by the vendee, and such possession, in case of a double sale, determines the
preference in favor of the one first took possession of it, in the absence of inscription, in
accordance with the provision of Article 1544 of the New Civil Code, notwithstanding the
material and personal possession by the second vendee.
25 (34). National Grain Authority vs. IAC
26 (35). State Investment House vs. Court of Appeals

FACTS: On October 15, 1969, Contract to Sell No. 36 was executed by the Spouses Canuto
and Ma. Aranzazu Oreta, and the Solid Homes, Inc. (SOLID), involving a parcel of land
identified as Block No. 8, Lot No. 1, Phase of the Capitol Park Homes Subdivision, Quezon City.
Upon signing of the contract, the spouses Oreta made payment with the agreement that the
balance shall be payable in monthly installments of P451.70, at 12% interest per annum. On
November 4, 1976, SOLID executed several real estate mortgage contracts in favor of State
Investment Homes, (sic) Inc. (STATE) over its subdivided parcels of land, one of which is the
subject lot covered by Transfer Certificate of Title No. 209642. For Failure of SOLID to comply
with its mortgage obligations contract, STATE extrajudicially foreclosed the mortgaged
properties including the subject lot on April 6, 1983, with the corresponding certificate of sale
issued therefor to STATE annotated at the back of the titles covering the said properties on
October 13, 1983. On August 15, 1988, the spouses filed a complaint before the Housing and
Land Use Regulatory Board, HLRB, against the developer SOLID and STATE for failure on the
part of SOLID "to execute the necessary absolute deed of sale as well as to deliver title to said
property . . . in violation of the contract to sell . . .," despite full payment of the purchase price as
of January 7, 1981.
ISSUE: Whether or not there is an error in not applying the settled rule that persons dealing with
property covered by torrens certificate of title are not required to go beyond what appears on the
face of the title.
HELD: As a general rule, where there is nothing in the certificate of title to indicate any cloud or
vice in the ownership of the property, or any encumbrance thereon, the purchaser is not
required to explore further than what the Torrens Title upon its face indicates in quest for any
hidden defect or inchoate right that may subsequently defeat his right thereto. The exception in
this case is that the petitioner is a financing institution. We take judicial notice of the uniform
practice of financing institutions to investigate, examine and assess the real property offered as
security for any loan application especially where, as in this case, the subject property is a
subdivision lot located at Quezon City, M.M. It is a settled rule that a purchaser or mortgagee
cannot close its eyes to facts which should put a reasonable man upon his guard, and then
claim that he acted in good faith under the belief that there was no defect in the title of the
vendor or mortgagor. Petitioner's constructive knowledge of the defect in the title of the subject
property, or lack of such knowledge due to its negligence, takes the place of registration of the
rights of respondents-spouses. Respondent Court thus correctly ruled that petitioner was not a
purchaser or mortgagee in good faith; hence petitioner can not solely rely on what merely
appears on the face of the Torrens Title.
27 (36). Villanueva vs Court of Appeals
Facts:
In her complaint, herein private respondent Catalina Sanchez, claiming to be the widow of
Roberto Sanchez, averred that her husband was the owner of a 275 sq. meter parcel of land
located at Rosario, Cavite, which was registered without her knowledge in the name of the
herein petitioners on the strength of an alleged deed of sale executed in their favor by her late
husband. In a report of a handwriting expert at the Philippine Constabulary Criminal
Investigation Service found that the signature on the document was written by another person,
she prayed that the deed of sale be annulled, that the registration of the lot in the name of the
petitioners be cancelled, and that the lot be reconveyed to her.

On the merits, petitioners claimed that Roberto Sanchez had deeded over the lot to them for the
sum of P500.00 in partial settlement of a judgment they had obtained against him. They had
sued him after he had failed to pay a P1,300.00 loan they had secured for him and which they
had been forced to settle themselves to prevent foreclosure of the mortgage on their property.
The trial court required the examination of the deed of sale by the National Bureau of
Investigation on the alleged forgery, and was decided in favor of the petitioners.

The decision was reversed by the Court of Appeals .

Issue: Whether the Court of Appeals erred in : a) upholding the testimony of the expert
witnesses against the findings of fact of the trial court; b) annulling the deed of sale; c) declaring
that the action to annul the deed of sale had not yet prescribed; d) not declaring the private
respondent guilty of estoppel; and e) not sustaining the decision of the trial court.

Held:
No to all. The petitioners have not proved the validity and authenticity of the deed of sale or
even the circumstances that supposedly led to its execution by the late Roberto Sanchez. The
Court was convinced from the testimonies of the handwriting experts that Roberto's signature
had been forged on the questioned document extensively given on direct and cross-examination
at the instance of the petitioners themselves, which was never assailed by the them nor was
questioned by the trial Judge and that he had not conveyed the subject land to the petitioners.
The deed of sale being a forgery, according to the provisions of Art. 1410 of theCivil Code was
totally void or inexistent and so could be challenged at any time, hence, the action for its
nullification does not prescribe.
28(37). Egao vs. Court of Appeals
Facts:

The respondents filed a motion for quieting the title and recovery of possession and
ownership against the petitioners. Apparently, they claim they are the owners of the parcel of
land by virtue of the deed of sale they entered into with Roberto Marfori to whom the petitioners
allegedly sold their land to. The Egaos acquired their land title by virtue of a free patent and
transferred their ownership in favor of Marfori by virtue of a deed of sale. However, the
Certificate of Title was not transferred in Marfori’s favor. Upon purchase of the land from Marfori,
the respondents introduced improvements thereon and paid taxes for the property. However,
the petitioners illegally occupied portions of the land. Petitioner answers that they are the true
owner of the land by virtue of the Certificate of Title issued by the Register of Deeds pursuant to
their Free Patent. The lower court ruled in favor of Egao. Upon appeal, the CA reversed the
decision of the lower court on grounds that the main issue should be whether Egao can validly
sell the land to Marfori who subsequently transferred the ownership to the respondents. The CA
holds both Egao and Marfori to be in pari delicto for violating the 5-year restriction provided by
Commonwealth 141 against encumbrance and alienation of public lands acquired thru free
patent or homestead patent. They cannot therefore obtain affirmative relief. It also declares the
respondents as innocent purchasers for value who the obtained the duplicate of the OCT still in
the name of the Egaos from Marfori and ownership was transferred to them by physical
possession of the property. It thus promulgated judgment holding the respondents the absolute
owners of the land in dispute, to cancel the OCT of the petitioner and its transfer thereof to the
respondents and to surrender peaceful possession of the land to the respondents.

Issue:Whether or not the petitioners validly transferred their ownership to Marfori to resolve the
rights of the respondents over the land in dispute?

Held:

The SC holds that based on the adduced evidence, the Egaos sold the lot to Marfori within the
5-year restriction period provided by law on Free Patent based on the Deed of Sale entered into
by the parties. Although the petitioners denied the validity of the Deed of Sale the court held that
it was notarized and a notarial document has in its favor the presumption of regularity. When the
land was sold to the respondents, they know that the OCT is still registered under the name of
the petitioners. Thus, they are not considered to be innocent purchaser as contrary to the ruling
of the CA. Where a purchaser neglects to make the necessary inquiries and closes his eyes to
facts which should put a reasonable man on his guard as to the possibility of the existence of a
defect in his vendor's title, and relying on the belief that there was no defect in the title of the
vendor, purchases the property without making any further investigation, he cannot claim that
he is a purchaser in good faith for value. A private individual cannot bring an action for reversion
or any action which would have an effect of canceling a free patent and the certificate of title
issued on the basis thereof since the land covered will form part again of the public domain.
Sec. 124 of the Public Land Act provides that deeds of sale of patented lands, perfected within
the prohibited five (5) year period are null and void thus the Egaos have no title to pass to
Marfori and nobody can dispose that which does not belong to him. The respondents are not
innocent purchasers for value with no standing to question the rights of the petitioners over the
land and to file an action to quiet the title. The petitioners remained to be the registered owners
and entitled to remain in physical possession of the disputed property. Respondents are ordered
to deliver the OCT to the petitioners without prejudice to an action for reversion of the land to be
instituted by the Solicitor General for the State.
29 (38). Republic vs. Umali

Facts:
The land in question is situated in Tanza, Cavite, which was originally purchased on
installment from the government on July 1, 1910 by Florentina Bobadilla.

The petitioner seeks reversion of a parcel of land on the ground that the original sale thereof
from the government was tainted with fraud because based on a forgery and therefore void ab
initio. The present holders of the property claiming to be innocent purchasers for value and not
privy to the alleged forgery, contend that the action cannot lie against them.

The respondents also contend that the government was not the real party-in-interest because
the subject land was already covered by the Torrens system, and that in any event the action
was barred by prescription or laches.

The petitioner claims that it is not barred by the statute of limitations because the original
transfer of the land was null and void ab initio and did not give rise to any legal right. The land
therefore continued to be part of the public domain and the action for this reversion could be
filed at any time.

Issue: Whether or not the land being now registered under the Torrens system in the names of
the private respondents, the government has no more control or jurisdiction over it.

Held:
Yes. In the case of Municipality of Hagonoy vs. Secretary of Agriculture and Natural
Resources it was held that once a patent is registered and the corresponding certificate of title is
issued, the land ceases to be part of public domain and becomes private property over which
the director of Lands has neither control nor jurisdiction.

A public land patent, when registered in the corresponding Register of Deeds, is a veritable
Torrens Title, and becomes as indefeasible as Torrens Title upon the expiration of one (1) year
from the date of issuance thereof. Said title is, like one issued pursuant to a judicial decree,
subject to review within one (1) year from the date of the issuance of the patent. Beyond said
period, the action for the annulment of the certificate of title issued upon the land grant can no
longer be entertained.

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.
30 (39). Muyco vs. Court of Appeals

Facts:
Eugenio Saga filed an application for a homestead patent over a portion of Lot No. 5164.
Sometime thereafter, the Bureau of Lands subdivided the said lot into two smaller lots,
described as Lot Nos. 5956 and 6331. Eugenio Saga's application was approved in 1936 and
he was issued a Homestead Patent over said portion of Lot 5164 by the Director of Lands.

Eugenio Saga sold his rights over the homestead to his son Sergio Saga. On the same date,
Sergio filed a homestead application over Lot No. 5956. In 1954, an OCT was issued to Sergio
Saga over the said lot.

On the other hand, on March 4, 1946, Leon Tolabing filed a homestead application over Lot No.
5956. This application was approved on October 5 of the same year, and on April 11, 1955, he
sold his homestead rights to Ambrocio Muyco. On the same date, Muyco filed his homestead
application over the said lot but was denied as there has already an OCT issued to Saga.

A report by the Office of the Public Land Inspector that there had been an error in recording the
lot number of Sergio Saga.

In the meantime, Sergio Saga filed a case for "Recovery of Possession" against Ambrocio
Muyco, contending that Sergio Saga was the holder of a Certificate of Title covering the lot in
question.

Issue: WON Sergio Saga has the right over the land in question.

Ruling:

SC ruled in favour of Sergio Saga who acquired a vested right over the lot in question,
and not Leon Tolabing. It was this vested right which Sergio Saga likewise acquired by virtue of
the sale on February 2, 1952 involving the homestead. An original certificate of title issued on
the strength of a homestead patent partakes of the nature of a certificate issued in a judicial
proceeding and become indefeasible and incontrovertible in favour of a person named therein.
31 (40). Seno vs. Mangubat

FACTS:

Crisanta Seno, negotiated and agreed on a mortgage over the disputed parcel of land for the
sum of P15000 with 2% interest monthly in favor of Mangubat. By virtue of which, Seno agreed
to the execution of a Deed of Absolute Sale over the subject property in favor of Mangubat who
was able to obtain title over it.

When Seno failed to pay the interest, Mangubat instituted an ejectment case against her for
non-payment of rentals. Mangubat thereafter sold the subject property in favor of spouses
Luzame and Peñaflor who also subsequently filed an ejectment case against Seno.

Seno then filed a complaint against Mangubat and the spouses seeking (1) reformation of a
Deed of Sale in favor of Mangubat and (2) the annulment of subsequent sale to the spouses
alleging that the spouses bought the property in bad faith. The complaint was however
dismissed by the trial court.

Hence, this appeal certified by the CA to the SC.

ISSUE:

Whether or not the spouses are purchasers in bad faith.

DECISION:

No, the spouses are purchasers in good faith.

Spouses claim that they came to know of the existence of the original title of Seno only when
they verified the title to the land in 1969 when it was being offered to them by co-defendant
Mangubat.

According to the SC, it is enough that they examine the latest certificate of title which in this
case is that issued in the name of the immediate transferor, Mangubat. The purchaser is not
bound by the original certificate of title but only by the certificate of title of the person from whom
he has purchased the property.

Furthermore, the well-known rule in this jurisdiction is that a person dealing with a registered
land has a right to rely upon the face of the Torrens Certificate of Title and to dispense with the
need of inquiring further, except when the party concerned has actual knowledge of facts and
circumstances that would impel a reasonably cautious man to make such inquiry.

Thus, where innocent third persons relying on the correctness of the certificate of title issued,
acquire rights over the property, the court cannot disregard such rights and order the total
cancellation of the certificate for that would impair public confidence in the certificate of title;
otherwise everyone dealing with property registered under the torrens system would have to
inquire in every instance as to whether the title had been regularly or irregularly issued by the
court.

Petition is dismissed.
34 (41). Lopez vs. Alberto
FACTS:

Defendant Padilla applied for a homestead patent over the subject land in the Province of Cebu
with the Bureau of Lands. The Director of Lands thereafter issued a homestead patent in his
favor thru his heirs on December 16, 1962.

However, sometime in 1958, the plaintiffs in this case had begun reclaiming the area covered by
water which was covered by Padilla’s application for homestead and building thereon their
dwelling. Consequently, some of them applied for lease of reclaimed areas and the others for
Miscellaneous Sales with the Bureau of Lands.

Padilla then sold the land to his co-defendant Edgar Woolbirght and the two ordered the
plaintiffs to vacate the place.

Plaintiffs then filed a complaint with the lower court praying among others that Padilla’s
homestead patent and corresponding original certificate of title be declared null and void
alleging that it was procured thru fraud and misrepresentation and that the sale was it is in
violation of law.

Padilla and Woolbright, in their answer, allege that the patent issued in December 1952 has
long since become final and pursuant to the final judgment by the SC is valid, legal and
indefeasible.

The lower court dismissed the case ruling that Padilla’s torrens title was no longer susceptible to
collateral attack through plaintiff’s ordinary civil action and being a court of general jurisdiction, it
has no power to grant the annulment of the said title.

Furthermore, the lower court enumerated the methods for direct attack against a torrens title,
namely:

1) review under Sec. 38 of the Land Registration Act by filing the appropriate petition within
one year from the issuance of the order for the issuance of the patent
2) an appeal to the appellate court within the reglementary period from the decision of the
Court
3) and in the case of the homestead, the administrative remedies may be pursued

Hence, this petition to the SC.

ISSUE:

Whether or not the torrens title may be attacked by the plaintiff’s action before the lower court.

DECISION:

No, the torrens title issued to Padilla and Woolbright in pursuance of the homestead patent is no
longer susceptible to collateral attack through the present action filed by plaintiffs, who as mere
applicants of revocable lease permits or miscellaneous applications of what is now concededly
titled property of private ownership, have no personality or legal interest in the first place to
institute the action, nor to question the sale of the homestead allegedly within the five-year
prohibitory period of section 118 of the Public Land Act.
35 (42). Toyota Motors Philippines vs. Court of Appeals
36 (43). National Grain Authority vs. IAC

FACTS: On December 2,1971, the spouses Paulino Vivas and Engracia Lizards, as owners of a
parcel of land situated in Laguna sold said property in favor of spouses Melencio Magcamit and
Nena Cosico, and Amelita Magcamit. This sale with right to repurchase was recorded in the
Office of the Register of Deeds of Laguna on December 6,1971 under Act No. 3344. On
January 31, 1972 the sale was made absolute by the spouses Vivas and Lizardo in favor of the
private respondents for the sum of P90, 000.00. On February 26, 1975, an Original Certificate of
Title No. T-1728 covering the property in question was issued to and in the name of the spouses
Vivas and Lizardo without the knowledge of the private respondents and on April 30, 1975, said
Spouses executed a Special Power of Attorney in favor of Irenea Ramirez authorizing the latter
to mortgage the property with the petitioner, National Grains Authority which was subsequently
foreclosed. On May 31, 1974, the Provincial Sheriff caused the issuance of the notice of sale of
the property in question, scheduling the public auction sale on June 28, 1974. The petitioner
was the highest and successful bidder so that a Certificate of Sale was issued in its favor on the
same date by the Provincial Sheriff. It was only in July 1974, that private respondents learned
that a title in the name of the Vivas spouses had been issued covering the property in question
and that the same property had been mortgaged in favor of the petitioner.

ISSUE: Whether or not the National Grains Authority has a better title and right, an innocent
purchaser for value, against the private respondents.

HELD: Thus, it has been invariably restated by this Court, that "The real purpose of the Torrens
System is to quiet title to land and to stop forever any question as to its legality." Once a title is
registered, the owner may rest secure, without the necessity of waiting in the portals of the
court, or sitting on the "mirador su casato," avoid the possibility of losing his land." "An indirect
or collateral attack on a Torrens Title is not allowed. Well settled is the rule that all persons
dealing with property covered by a torrens certificate of title are not required to go beyond what
appears on the face of the title. When there is nothing on the certificate of title to indicate any
cloud or vice in the ownership of the property, or any encumbrance thereon, the purchaser is
not required to explore further than what the torrens title upon its face indicates in quest for any
hidden defect or inchoate right that may subsequently defeat his right thereto.
37 (44). Salao vs. Salao

Facts:
The spouses Manuel Salao and Valentina Ignacio of Barrio Dampalit, Malabon, Rizal
begot four children named Patricio, Alejandra, Juan (Banli) and Ambrosia. Manuel Salao died in
1885. His eldest son, Patricio, died in 1886 survived by his only child, Valentin Salao. After the
death of Valentina, Ambrosia her daughter administered her estate.
The documentary evidence in 1911 prior to the death of Valentina her two children Juan Y.
Salao and Ambrosia Salao secured a torrens title OCT No. 185 of the Registry of deeds in
Pampanga in ther names.
The Calunuran Fish pond a 47 hectare fish pond located at Sitio Calunuran, Lubao Pampanga
which the ownership is in question by the plaintiffs.

Issue:
WON the plaintiffs’ action for reconveyance had already prescribed

Held:
The Calunuran Fish pond was registered in 1911 and the written extrajudicial demand of
the conveyance was made in 1951 and was filed in 1952, almost 40 years had passed and they
did not do anything for that long. The plaintiffs’ had slept on their rights if they had any rights at
all.
They cannot also question the donation made by Ambrosia Salao to Juan Salao Jr. of the ½
share of the fish pond, for the plaintiffs do not have the right and personality to assail the
donation.
38 (45). Halili vs. Court of Industrial
FACTS:
Halili Bus Drivers and Conductors Union (PTGWO), in behalf of its union members, filed
claims for unpaid overtime pay of its 897 union members against Fortunato Halili, doing
business under the name and style of Halili Transit. After Fortunato Halili’s demise, the union
and the administratix of Halili’s estate reached an agreement that in exchange for the overtime
claims, the administratix would transfer to the employees title to a tract of land covered by TCT
No. 36389, with a total area of 33, 952, situated in the Province of Rizal, and an amount of
P25,000 in full and final satisfaction of all the claims and causes of action of the employees, and
that they be absolutely relieved from any and all liability of the said case. The administratix then
issued a Deed of Reconveyance of Real Property transferring the land to the Halili Bus and
Conductors Union in trust for th union members claimants.
Legal counsel of Union, Atty. Pineda filed an urgent motion to Minister of Labor and
Employment (MOLE) requesting that authority be granted to dispose and sell the property.
MOLE granted the motion. He also requested to the Supreme Court for authority to sell the
property but only noted it for Resolution. Atty. Pineda then requested th MOLE that the Union be
authorized to sell the lot to Manila Memorial Park Cemetery, which was later on granted by
MOLE. On th basis of Arbiter Valenzuela and the Deed of Sale between the Union and the
MMPCI, the Transfer Certificate Title to the Union was cancelled and said property was
registered in the name of MMPCI under the Transfer Certificate Title. However, the Solicitor
General nullified the above orders of the Labor Arbiter being without due process of law.
The Union filed a motion for the recovery of the subject real property which was sold in
purely illegal sale.

ISSUE:
Whether or not the Union can still recover the subject real property sold to MMPCI

HELD:
NO. The fact that the subject real property was registered under the Torrens System of
Registration in the name of respondent MMPCI under Transfer Certificate of Title by the
Register of Deeds of Quezon City, makes the instant petition all the more dismissible,
considering that the best proof of ownership of a piece of land is the Certificate of Title. As
provided under Sec. 48 of PD 1529 or the Property Registration Decree, the certificate, in the
absence of fraud, is the evidence of title and shows exactly th real interest of its owner. The title,
once registered, with very few exceptions, should not thereafter be impugned, altered, changed,
modified, enlarged or diminished, except by direct proceeding permitted by law. In the present
petition, the Union’s filing for recovery of the land is a collateral attack which is not permitted
under the principle of indefeasibility of a Torrens Title. It is well settled that a Torrens Title
cannot be collaterally attacked.
The effect of such outright cancellation would be to impair public confidence in th
Certificate of Title, for everyone dealing with property registered under the Torrens System
would have to inquire in every instance as to whether the title has been regularly or irregularly
issued by the Court. And this is contrary to the evident purpose of the law. Every person dealing
with registered land may safely rely on the correctness of the Certificate of Title issued therefore
and the law will in no way oblige him to go behind th certificate to go behind the certificate to
determine the certificate of the property.
39 (46). Walstron vs. Mapa, Jr.

Facts: This case involves a disputed land wherein the predecessors in interest of herein
petitioner Wasltrom claimed that the last has been secured by a free patent. On the other hand,
the predecessor in interest of herein respondent Mapa allege that the land in dispute was
acquired and titled after registration through miscellaneous sale. Petitioner Walstrom in this
case filed an action to annul the title acquired by the the heirs of MAPA.

Issue: Can a registered land, issued with OCT be reconveyed?

Held: Yes. The land registration act provides that, “every decree of registration shall bind the
land, and quiet title thereto, subject only to the exceptions. The exception to the rule is the right
of any person deprived of the land or of any estate or interest therein by decree of registration
obtained by fraud.

The supreme court in its decided case stated that notwithstanding the irrevocability of torrens
title issued already in the name of another person, he can still be compelled under the law to
reconvey the subject property to the rightful owner. The property resgistered is deemed to be
held in trust for the real owner by the person in whose name it is registered. Torrens system
was not designed to shield and protect one who had committed fraud or misrepresentation and
thus holds title in bad faith.

In sum, the person in whose name the land is fraudulently registered holds it as a mere trustee,
with the legal obligation to reconvey the property and that title thereto in veer of the true owner.
40 (47). Pajarillo vs. IAC

Facts: The disputed land was donated to Salud by her mother. Despite of the donation, her
mother requested that she be allowed to use the said donated parcel of land and enjoy its fruits
until her death.

Thereafter, Juana (mother) executed a deed of sale of the said property in favor of Claudio,
brother of Salud. Claudio later successfully acquired a TCT title of the land in his favor.

Issue: Is the title valid?

Held: There is no question that the disputed land was donated to Salud though she failed to
comply with the formalities required in the process of donation. Ownership was transferred to
Salud for donation being valid, thus, cannot be alienated by her mother. Furthermore, the
consequence of an invalid alienation is an invalid title.

Any registration procured by the presentation of a forged deed of other instrument shall be null
and void.
42 (48). Torres vs. Court of Appeals
Facts:

A parcel of land and the building erected thereon is owned by Mariano Torres as
evidenced by Transfer Certificate of Title issued in his name. As far as the records show, Torres
was and still is in possession of the realties, holding safely to his owner's duplicate certificate of
title, and paying the real estate taxes due thereon, and collecting rentals from his tenants
occupying the building. Francisco Fernandez, Torres' brother-in-law, filed a petition with the
Court of First Instance, where he, misrepresenting to be the attorney-in-fact of Torres and
falsely alleging that the a duplicate copy of the TCT was lost, succeeded in obtaining a court
order for the issuance of another copy of the certificate. Once in possession thereof, Fernandez
forged a simulated deed of sale of the realties in his favor. Whereupon the TCT in the name of
Torres was canceled and a new TCT was issued in Fernandez' name. Fernandez mortgaged
the realties to Rosario Mota, wife of Ernesto Cue, and also to Angela Fermin, who later
assigned her credit to the spouses Cue. The mortgages were annotated at the back of the TCT
and so was the deed of assignment. Torres, who up to this time still had possession of his
owner's duplicate certificate of title and who was still collecting rentals from the occupants of the
subject building, upon learning of the fraud committed by Fernandez, caused the annotation on
the latter's TCT a notice of adverse claim. Torres filed a Civil Case against Fernandez to annul
the TCT. Fernandez failed to pay his various loans which prompted the Cues to institute an
extrajudicial foreclosure of the mortgage. Fernandez and spouses Cues entered into an
amicable settlement, approved by the court whereby it was stipulated that Fernandez
acknowledged and promised to pay his debt to the Cues. Before Fernandez could pay his
obligation under the settlement agreement, a decision was rendered in a Civil Case filed by
Torres against Fernandez where it was declared that the TCT under the name of Fernandez is
without force and effect as the TCT in the name of Torres is the true and legal evidence of
ownership of the subject immovables. Fernandez appealed to the Court of Appeals.

Before the CA can decide the case, Fernandez failed to comply with his obligation under
the amicable settlement and whereupon the Cues applied for and were granted a writ of
execution. The subject realties were then levied upon and sold at public auction where Rosario
Mota was the highest bidder. The redemption period for the subject immovables having lapsed
without Fernandez nor Torres redeeming the properties, Rosario Mota was issued the Sheriffs
Deed of Sale. Thereafter, TCT in the name of Fernandez was canceled and a TCT was issued
in Mota’s name. Mota, through her lawyer, notified the tenants occupying "M. Torres Building"
that she is the new owner thereof and henceforth, payment of their rentals should be made to
her. Torres filed a complaint with the CFI against Fernandez and his spouse and the Cues to
restrain the latter from collecting rentals and for the declaration as void the TCT in the name of
Mota. During the proceeding, Mariano Torres, having died sometime in 1974, was substituted
by his widow. The trial court rendered its decision declaring the TCT in the name of Rosario
Mota null and void as it upheld the validity of the TCT in the name of Torres as the true
evidence of title to the disputed realties. The CA reversed the decision of the trial court. Hence,
this petition.

Issue:

Whether or not Rosario Mota is legally entitled to the disputed realties.

Ruling:
 No. There is nothing on the records which shows that Torres performed any act or
omission which could have jeopardized his peaceful dominion over his realties. The doctrine
that a forged instrument may become the root of a valid title, cannot be applied where the owner
still holds a valid and existing certificate of title covering the same interest in a realty. The
doctrine would apply rather when the forger thru insidious means obtains the owner's duplicate
certificate of title, converts it in his name, and subsequently sells or otherwise encumbers it to
an innocent holder for value, for in such a case the new certificate is binding upon the owner.
But if the owner holds a valid and existing certificate of title, his would be indefeasible as against
the whole world, and not that of the innocent holder's.

A certificate is not conclusive evidence of title if it is shown that the same land had
already been registered and an earlier certificate for the same land is in existence. As between
two persons both of whom are in good faith and both innocent of any negligence, the law must
protect and prefer the lawful holder of registered title over the transfer of a vendor bereft of any
transmissible rights.
43 (49). Torres vs. Court of Appeals
Facts:

A parcel of land and the building erected thereon is owned by Mariano Torres as
evidenced by Transfer Certificate of Title issued in his name. As far as the records show, Torres
was and still is in possession of the realties, holding safely to his owner's duplicate certificate of
title, and paying the real estate taxes due thereon, and collecting rentals from his tenants
occupying the building. Francisco Fernandez, Torres' brother-in-law, filed a petition with the
Court of First Instance, where he, misrepresenting to be the attorney-in-fact of Torres and
falsely alleging that the a duplicate copy of the TCT was lost, succeeded in obtaining a court
order for the issuance of another copy of the certificate. Once in possession thereof, Fernandez
forged a simulated deed of sale of the realties in his favor. Whereupon the TCT in the name of
Torres was canceled and a new TCT was issued in Fernandez' name. Fernandez mortgaged
the realties to Rosario Mota, wife of Ernesto Cue, and also to Angela Fermin, who later
assigned her credit to the spouses Cue. The mortgages were annotated at the back of the TCT
and so was the deed of assignment. Torres, who up to this time still had possession of his
owner's duplicate certificate of title and who was still collecting rentals from the occupants of the
subject building, upon learning of the fraud committed by Fernandez, caused the annotation on
the latter's TCT a notice of adverse claim. Torres filed a Civil Case against Fernandez to annul
the TCT. Fernandez failed to pay his various loans which prompted the Cues to institute an
extrajudicial foreclosure of the mortgage. Fernandez and spouses Cues entered into an
amicable settlement, approved by the court whereby it was stipulated that Fernandez
acknowledged and promised to pay his debt to the Cues. Before Fernandez could pay his
obligation under the settlement agreement, a decision was rendered in a Civil Case filed by
Torres against Fernandez where it was declared that the TCT under the name of Fernandez is
without force and effect as the TCT in the name of Torres is the true and legal evidence of
ownership of the subject immovables. Fernandez appealed to the Court of Appeals.

Before the CA can decide the case, Fernandez failed to comply with his obligation under
the amicable settlement and whereupon the Cues applied for and were granted a writ of
execution. The subject realties were then levied upon and sold at public auction where Rosario
Mota was the highest bidder. The redemption period for the subject immovables having lapsed
without Fernandez nor Torres redeeming the properties, Rosario Mota was issued the Sheriffs
Deed of Sale. Thereafter, TCT in the name of Fernandez was canceled and a TCT was issued
in Mota’s name. Mota, through her lawyer, notified the tenants occupying "M. Torres Building"
that she is the new owner thereof and henceforth, payment of their rentals should be made to
her. Torres filed a complaint with the CFI against Fernandez and his spouse and the Cues to
restrain the latter from collecting rentals and for the declaration as void the TCT in the name of
Mota. During the proceeding, Mariano Torres, having died sometime in 1974, was substituted
by his widow. The trial court rendered its decision declaring the TCT in the name of Rosario
Mota null and void as it upheld the validity of the TCT in the name of Torres as the true
evidence of title to the disputed realties. The CA reversed the decision of the trial court. Hence,
this petition.

Issue:

Whether or not Rosario Mota is legally entitled to the disputed realties.

Ruling:
 No. There is nothing on the records which shows that Torres performed any act or
omission which could have jeopardized his peaceful dominion over his realties. The doctrine
that a forged instrument may become the root of a valid title, cannot be applied where the owner
still holds a valid and existing certificate of title covering the same interest in a realty. The
doctrine would apply rather when the forger thru insidious means obtains the owner's duplicate
certificate of title, converts it in his name, and subsequently sells or otherwise encumbers it to
an innocent holder for value, for in such a case the new certificate is binding upon the owner.
But if the owner holds a valid and existing certificate of title, his would be indefeasible as against
the whole world, and not that of the innocent holder's.

A certificate is not conclusive evidence of title if it is shown that the same land had
already been registered and an earlier certificate for the same land is in existence. As between
two persons both of whom are in good faith and both innocent of any negligence, the law must
protect and prefer the lawful holder of registered title over the transfer of a vendor bereft of any
transmissible rights.
45 (50). Abad vs. Guimba

Facts:
Spouses Ceasar and Vivian Guimba are the registered owners of a parcel of land. Vivian
entrusted her copy of the Owner’s Duplicate Certificate of Title to Gemma de la Cruz to serve as
collateral for Vivian’s application for a loan that was to be released in four days. Afterwards,
Gemma received a phone call from Vivian, who informed her that she had changed her mind,
was no longer interested in obtaining the loan, and therefore wanted her TCT back. Told that
the Certificate had been deposited in the vault of the Bank of South East Asia, Vivian inquired at
the bank, but was advised that the TCT was not there.
Vivian Guimba received a telegram from Petitioner Abad, a stranger, reminding her of the
impending maturity of her mortgage. It was the first time respondents learned of any actual
mortgage involving their property. Accordingly, the Guimbas filed with the Regional Trial Court a
complaint against Abad and Gemma de la Cruz for annulment and cancellation of mortgage.
Abad countered that spouses Guimbas had connived with De la Cruz to swindle him of his hard-
earned savings. He testified that he had met her and a couple posing as the Guimba spouses
("Guimbas"). The Guimbas allegedly asked him for a loan and presented their duplicate copy of
TCT No. PT-80617 as collateral.
During the trial, Abad admitted that the couple to whom he had given the loan of P335,000 were
not herein respondent-spouses Guimbas, whom he met only in December 1997 to discuss the
matter of the telegram.
Assessing the evidence, the trial court found the testimonies offered by Abad to be conflicting
and concocted. It determined that he had never met a couple posing as spouses Guimbas.
Rather, he had dealt solely with De la Cruz over a property that manifestly belonged to the
Guimba spouses. By entering into the mortgage without making the necessary inquiries as to
the identity and the authority of the person he was dealing with, he could not be considered a
mortgagee in good faith and for value. Moreover, he had not presented convincing proof of the
negotiation and execution of the mortgage Contract.
Abad lodged his Petition for Review directly with the Supreme Court.
Issues:
1. Whether an innocent holder for value of an original Owner’s Duplicate Copy of a Transfer
Certificate of Title who caused the registration of the Real Estate Mortgage Contract SIX
MONTHS prior to the recording or registration of an Affidavit of Adverse Claim executed by the
registered owner of a parcel of land be not protected by P.D. 1529.
2.Whether laches will not apply in the case at bar against the spouses Guimbas considering
their inaction for more than NINE MONTHS prior to the execution and recording of an Affidavit
of Adverse Claim over their title, which has unfortunately found its way to an innocent third
person and holder for value.
Held:
The Petition has no merit.
A Mortgagee in Bad Faith Not Protected by PD 1529
The main purpose of land registration, covered by PD 1529, is to facilitate transactions relative
to real estate by giving the public the right to rely upon the face of the Torrens certificate of title.
Therefore, as a rule, the purchaser is not required to explore further than what the Certificate
indicates on its face. This rule, however, applies only to innocent purchasers for value and in
good faith; it excludes a purchaser who has knowledge of a defect in the title of the vendor, or of
facts sufficient to induce a reasonably prudent man to inquire into the status of the property.
Under Section 32 of PD 1529, an innocent purchaser for value is deemed to include an innocent
mortgagee for value.
He invokes Sections 52 and 53 of the law, which protects innocent mortgagees for value, but
which the RTC has already determined he was not.
Abad’s contention of due diligence and good faith in verifying the authenticity of the Transfer
Certificate of Title and finding it clean on its face is beside the point. He was not a mortgagee in
good faith, not because he neglected to ascertain the authenticity of the title, but because he did
not check if the person he was dealing with had any authority to mortgage the property. There is
no allegation whatsoever that Gemma de la Cruz presented a special power of attorney to deal
with the property of the Guimbas; and even if we accept the story of petitioner that he was
duped by a woman posing as Vivian Guimba, his negligence lies in not verifying her identity
before accepting the mortgage.
As to the issue of Laches
First, the law does not compel them to file an adverse claim. The purpose of that claim is to give
notice to third persons of the existence of an interest adverse to that of the registered owner. In
the instant case, spouses Guimbas are the registered owners. The fact that their names appear
on the title as absolute owners should already notify third persons, such as petitioner Abad, that
they have a clear legal interest in the property.
Second, there is no equitable basis for the application of laches, considering that (1) only nine
months had elapsed from the loss of the title to the registration of an adverse claim, (2) no
prejudice was caused an innocent purchaser for value, and (3) there was a factual
determination by the trial court that respondents had taken the appropriate steps to protect their
interests.
Third, even if we assume arguendo that spouses Guimbas were negligent, petitioner Abad still
cannot claim a superior right, considering that he too was negligent; he cannot feign innocence
as regards their existing interests as the registered owners. Simply put, their alleged negligence
did not prejudice petitioner, who was perfectly aware all the time that the property belonged to
them, not to De la Cruz.
46 (51). Legarda vs. Court of Appeals

Facts:
The parties Victoria Legarda and New Cathay House, Inc. (Cathay for brevity) entered into a
lease agreement over a certain Quezon City property owned by Victoria Legarda. For some
reason or another, Legarda refused to sign the contract although Cathay, made a deposit and a
down payment of rentals, prompting Cathay to file before the Regional Trial Court of Quezon
City against Legarda for specific performance. Legarda's counsel, lawyer Dean Antonio
Coronel, requested a 10-day extension of time to file an answer which the court granted. Atty.
Coronel, however, failed to file an answer within the extended period. His client was eventually
declared in default. A judgment by default was reached by the trial court ordering Legarda to
execute the lease contract in favor of, and to pay damages to, Cathay.
A copy of said decision was served on Atty. Coronel but he took no action until the judgment
became final and executory. A month later, the trial court issued a writ of execution and a public
auction was held where Cathay's manager, Roberto V. Cabrera Jr., as the highest bidder.
Consequently, a Certificate of Sale was issued by the sheriff on June 27, 1985. Upon failure of
Legarda to redeem her property within the one-year redemption period, a Final Deed of Sale
was issued by the sheriff which was registered by Cabrera with the Register of Deeds. Hence,
Legarda's Transfer Certificate of Title (TCT) No. 270814 was cancelled with the issuance of
TCT No. 350892 in the name of Cabrera.
Despite the lapse of over a year since the judgment by default became final and executory, Atty.
Coronel made no move on behalf of his client. He did not even inform Legarda of all these
developments. When Legarda did learn of the adverse decision, she nevertheless did not lose
faith in her counsel. Atty. Coronel filed a petition for annulment of judgment with prayer for the
issuance of a writ of preliminary mandatory injunction before the Court of Appeals.
The appellate court rendered a decision affirming the March 25, 1985, decision of the trial court,
dismissing the petition for annulment of judgment, and holding Legarda bound by the
negligence of her counsel. It considered her allegation of fraud by Cathay to be "improbable,"
and added that there was "pure and simple negligence" on the part of Atty. Coronel who failed
to file an answer and, later, petition for relief from judgment default. Upon notice of the Court of
Appeals decision, Atty. Coronel again neglected to protect his client's interest by failing to file a
motion for reconsideration or to appeal therefrom until said decision became final.
Legarda learned of the adverse decision of the Court of Appeals, not from Atty. Coronel but
from his secretary. She then hired a new counsel for the purpose of elevating her case to this
Court. The new lawyer filed a petition for certiorari praying for the annulment of the decision of
the trial and appellate courts and of the sheriff's sale, alleging, among other things, that Legarda
lost in the courts below because her previous lawyer was grossly negligent and inefficient,
whose omissions cannot
possibly bind her because this amounted to violation of her right to due process of law. She,
therefore, asked Cathay (not Cabrera) to reconvey the subject property to her.
On March 18, 1991, a decision was rendered by this Court, in this case by Mr. Justice
Gancayco, ruling, inter alia, as follows: (a) granting the petition; (b) nullifying the trial court's
decision dated March 25, 1985, the Court of Appeals decision dated November 29, 1989, the
Sheriff's Certificate of Sale dated June 27, 1985, of the property in question, and the
subsequent final deed of sale covering the same property; and (c) ordering Cathay to reconvey
said property to Legarda, and the Register of Deeds to cancel the registration of said property in
the name of Cathay (not Cabrera) and to issue a new one in Legarda's name.
The Court then declared that Atty. Coronel committed, not just ordinary or simple negligence,
but reckless, inexcusable and gross negligence, which deprived his client of her property
without due process of law. Atty. Coronel appeared to have abandoned her case not once but
repeatedly. Thus, the Court ruled against tolerating "such unjust enrichment" of Cathay at
Legarda's expense.
Cathay filed the instant motion for reconsideration, alleging, inter alia, that reconveyance is not
possible because the subject property had already been sold by its owner, Cabrera.
Issue:
Whether the reconveyance of the subject property to Legarda is proper.
Held:
By virtue of the Gancayco decision, Cathay was duty bound to return the subject property to
Legarda. The impossibility of this directive is immediately apparent, for two reasons: First,
Cathay neither possessed nor owned the property so it is in no position to reconvey the same;
second, even if it did, ownership over the property had already been validly transferred to
innocent third parties at the time of promulgation of said judgment.
There is no question that the highest bidder at the public auction was Cathay's manager. What
is clear from the records is that the auction sale was conducted regularly, that a certificate of
sale and, subsequently, a final deed of sale were issued to Cabrera which allowed him to
consolidate his ownership over the subject property, register it and obtain a title in his own
name, and sell it to Nancy Saw, an innocent purchaser for value, at a premium price. Nothing on
record would demonstrate that Cathay was the beneficiary of the sale between Cabrera and
Saw. Cabrera himself maintained that he was "acting in his private (as distinct from his
corporate) capacity" when he participated in the bidding.
We do not have to belabor the fact that all the successors-in-interest of Cabrera to the subject
lot were transferees for value and in good faith, having relied as they did on the clean titles of
their predecessors. The successive owners were each armed with their own indefeasible titles
which automatically brought them under the aegis of the Torrens System. As the Court declared
in Sandoval v. Court of Appeals, "it is settled doctrine 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
such burdens and claims as are annotated on the title." In the case at bar, it is not disputed that
no notice of lis pendens was ever annotated on any of the titles of the subsequent owners. And
even if there were such a notice, it would not have created a lien over the property because the
main office of a lien is to a warn prospective buyers that the property they intend to purchase is
the subject of a pending litigation. Therefore, since the property is already in the hands of
Luminlun, an innocent purchaser for value, it can no longer be returned to its original owner by
Cabrera, much less by Cathay itself.
Under the Gancayco ruling, the order of reconveyance was premised on the alleged gross
negligence of Legarda's counsel which should not be allowed to bind her as she was deprived
of her property "without due process of law."
It is, however, basic that as long as a party was given the opportunity to defend her interests in
due course, she cannot be said to have been denied due process of law, for this opportunity to
be heard is the very essence of due process. The chronology of events shows that the case
took its regular course in the trial and appellate courts but Legarda's counsel failed to act as any
ordinary counsel should have acted, his negligence every step of the way amounting to
"abandonment," in the words of the Gancayco decision. Yet, it cannot be denied that the
proceedings which led to the filing of this case were not attended by any irregularity. The
judgment by default was valid.
Void judgments may be classified into two groups: those rendered by a court without jurisdiction
to do so and those obtained by fraud or collusion. It must be pointed out that while Legarda
went to the Court of Appeals claiming precisely that the trial court's decision was fraudulently
obtained, she grounded her petition before the Supreme Court upon her estranged counsel's
negligence. This could only imply that at the time she filed her petition for annulment of
judgment, she entertained no notion that Atty. Coronel was being remiss in his duties. It was
only after the appellate court's decision had become final and executory, a writ of execution
issued, the property auctioned off then sold to an innocent purchaser for value, that she began
to protest the alleged negligence of her attorney.
Thus, the motion for reconsideration of Cathay House, Inc. is granted. The decision dated
March 18, 1991 (The Gancayco decision) is vacated.
47 (52). Baltazar vs. Court of Appeals

Facts:

Artemio Baltazar instituted Civil Case against Good Earth for declaration of ownership and
reconveyance of the parcels of land before the Court of First Instance of Rizal. Baltazar traced
his claimed rights from an alleged vast Spanish land grant to one "Don Hermogenes Rodriguez,
Governor General of Intramuros, Manila down to a deed of sale over the subject lots allegedly
executed by one Pedro Asedillo (for whose mother, Baltazar had been a tenant sharing in the
rice harvest from the lots). Accordingly, the TCT in the name of Good Earth was canceled and
another one, TCT was issued in the name of Baltazar, all without the knowledge of Good Earth.
Baltazar lost no time at all in selling the land so titled in his name to Aurora Galvez and two
other purchasers. Good Earth instituted a complaint for annulment of the judgment and for
reconveyance, against Baltazar and his vendees Galvez and two other vendees, they argued
that Land Registration Decree No. N-70457, by virtue of which OCT No. 1866 was issued to
Lorenzo Molera, predecessor-in-interest of Good Earth, became incontrovertible one year after
its registration. On appeal by Good Earth, the Court of Appeals, reversed the trial court's
decision and ordered the Registry of Deeds of Rizal to cancel the TCT issued in the names of
Baltazar, Galvez, and two other vendees, reinstated TCT which had stood in the name of Good
Earth. It the petition for review instituted by Baltazar, he alleged that his vendees were
purchaser in good faith and hence acquired the rights independent of the acts of Baltazar.

Issue:

Whether or not Baltazar's vendees, who according to Baltazar were purchasers in good
faith, had acquired any rights independent of the acts of petitioner Baltazar?

Ruling:

No. Baltazar's vendees have not proved their status as purchasers in good faith and for
value of the land which Baltazar had no right to sell. The burden of proving the status of a
purchaser in good faith and for value lies upon him who asserts that status. In discharging that
burden, it is not enough to invoke the ordinary presumption of good faith, i.e., that everyone is
presumed to act in good faith. The good faith that is here essential is integral with the very
status which must be proved.

As between two persons both of whom are in good faith and both innocent of any
negligence, the law must protect and prefer the lawful holder of registered title over the
transferee of a vendor bereft of any transmissible rights. Therefore, Baltazar's vendees, who
according to Baltazar were purchasers in good faith, had not acquired any rights independent of
the acts of petitioner Baltazar.

48 (53). Register of Deeds vs. PNB

FACTS:

Datu Binasing acquired ownership of four lots by virtue of four Cadastral Cases and,
accordingly, had corresponding Original Certificates Of Title issued in his name in the year
1935. Eventually, Datu Binasing sold the said lots to Soledad de Teruel who, in her name,
acquired corresponding Transfer Certificates Of Title to the same lots.

The Deed of Sale was duly registered with the Register of Deeds in Cotabato. In an unfortunate
turn of events, during the Pacific War, said Register of Deeds burned down. Consequently, its
archive of records, including the original Certificates Of Title covering the lots under the name of
Datu Binasing, were among those that perished in the fire.

In 1947, Datu Binasing secured copies of the aforesaid Decrees from the General Land
Registration Office and executed an Affidavit declaring he had never secured Certificates of
Title for the four lots. With said documents as basis, the Register of Deeds issued a new set of
Original Certificates Of Title. Thereafter, Datu Binasing obtained a loan from the Philippine
National Bank (PNB) and offered, as security, the same four lots in addition to some of his other
properties. The mortgage was eventually extrajudicially foreclosed in 1954 with the PNB as the
highest bidder during the foreclosure sale.

Meanwhile, Soledad de Teruel had her Transfer Certificates of Title to the four lots
reconstituted in 1948. The Register of Deeds, upon discovery of such events which resulted to
two different Certificates of Title for each of the four lots compounded by such titles being in the
name of two different persons, sought to have the Original Certificates Of Title, issued in the
name of Datu Binasing, cancelled. This prayer on the premise that the titles were issued
erroneously since the Datu was only able to secure them due to false representation owing to
the Affidavit he executed attesting, allegedly, to the fact that he had never secured any previous
title to the lots . The lower court ruled in favour of the Register of Deeds prompting the PNB to
file an appeal with the contention that, it being an innocent mortgagee for value, it is entitled to
protection, that is, a mortgagee, relying upon a Torrens title, in good faith and unaware that
fraud had been committed by forgery, was protected and that the innocent purchaser for value
may take good title, notwithstanding defects of the mortgagor's title deeds.

ISSUE:

Whether the Original Certificates of Title issued in the name of Datu Binasing are indefeasible.

RULING:

The Supreme Court based its adjudication on the Theory of Indefeasibility of Titles under the
Torrens System. The Court underscored the fact that indefeasibility of title could be claimed
only if a previous valid title to the same parcel of land does not exist. That where issuance of the
title was attended by fraud, the same cannot vest in the titled owner any valid legal title to the
land covered by it; and the person in whose name the title was issued cannot transmit the
same, for he has no true title thereto in the first place. This ruling is a mere affirmation of the
recognized principle that a certificate is not conclusive evidence of title if it is shown that the
same land had already been registered and an earlier certificate for the same land is in
existence.

In this case, the titles of Datu Binasing that were actually mortgaged to the PNB were issued
in 1947 as Original Certificates, whereas, about ten years before, in 1938, Soledad de Teruel
had already acquired a Torrens title to the same land. Therefore, the titles issued to Datu
Binasing could not triumph over those previously issued to Soledad de Teruel under the
principle Prior in tempore, potior in jure (“He who is before in time, is preferred in right”) and are
in fact not indefeasible titles.

Additionally, the Supreme Court ruled that PNB’s claim to protection does not hold much sway
since its credit against Datu Binasing might still be enforced considering that Datu has
proffered his other properties as security.
49 (54). Garcia vs. Court of Appeals
Facts:

1. OCT 983 that covered certain parcels of land of Hacienda Maysilo was not cancelled
despite sale to a certain Ismael Lapuz, father of private respondent Carolina Lapuz-
Gozon who became registered owner of said property as she inherited such when the
former died

2. At a later date, when said OCT was cancelled in favor of alleged heirs of a certain Maria
de la Concepcion Vidal who were allegedly deprived participation in an earlier partition
proceeding anent to said Hacienda Maysilo, new title to said property was assigned to
certain successors-in-interest of the Riveras and one of them is petitioner Pacifico Garcia

3. Subsequent transfers of ownership took place that eventually warranted actions to

quiet title and payment for damages

4. When the issue reached the jurisdiction of respondent Court of Appeals, it affirmed the
decision of the trial court voiding the title issued to the Riveras and all titles and
transactions emanating therefrom that includes the title acquired by petitioner Garcia
via assignment and petitioner Philippine National Bank via auction sale

5. Petitioners Garcia and Philippine National Bank challenged said judgement of

respondent Court of Appeals anent to a point raised that Ismael Lapuz and his
successors-in-interest lost their right to the disputed lots due to their negligence or
inaction.

Issue:

Whether contention of petitioners Garcia and Philippine National Bank holds water

Held:

The Supreme Court ruled in favor of the authenticity of the title of Ismael Lapuz and his
successors-in-interest as it upheld the materiality of the maxim prior est in tempore, potior est
in jure (he who is first in time is preferred in right) as such is used in land registration matters