chapter2(1) ltd case

7/29/2019 chapter2(1) LTD case

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Republic of the PhilippinesSUPREME COURT

Manila

EN BANC

G.R. No. L-28790 April 29, 1968

ANTONIO H. NOBLEJAS, as Commissioner of Land Registration, petitioner,vs.CLAUDIO TEEHANKEE, as Secretary of Justice, and RAFAEL M. SALAS, as ExecutiveSecretary,respondents.

Leandro Sevilla, Ramon C. Aquino and Lino M. Patajo for petitioner.Claudio Teehankee for and in his own behalf as respondent.

REYES, J.B.L., Actg. C.J .:

Petition for a writ of prohibition with preliminary injunction to restrain the Secretary of Justice frominvestigating the official actuations of the Commissioner of Land Registration, and to declareinoperative his suspension by the Executive Secretary pending investigation.

The facts are not in dispute. Petitioner Antonio H. Noblejas is the duly appointed, confirmed andqualified Commissioner of Land Registration, a position created by Republic Act No. 1151. By theterms of section 2 of said Act, the said Commissioner is declared "entitled to the samecompensation, emoluments and privileges as those of a Judge of the Court of First Instance." Theappropriation laws (Rep. Acts 4642, 4856 and 5170) in the item setting forth the salary of saidofficer, use the following expression:

1. One Land Registration Commissioner with the rank and privileges of district judge

P19,000.00.

On March 7, 1968, respondent Secretary of Justice coursed to the petitioner a letter requiring him toexplain in writing not later than March 9, 1968 why no disciplinary action should be taken againstpetitioner for "approving or recommending approval of subdivision, consolidation and consolidated-subdivision plans covering areas greatly in excess of the areas covered by the original titles."Noblejas answered and apprised the Secretary of Justice that, as he enjoyed the rank, privileges,emoluments and compensation of a Judge of the Court of First Instance, he could only besuspended and investigated in the same manner as a Judge of the Courts of First Instance, and,therefore, the papers relative to his case should be submitted to the Supreme Court, for actionthereon conformably to section 67 of the Judiciary Act (R. A. No. 296) and Revised Rule 140 of theRules of Court.

On March 17, 1968, petitioner Noblejas received a communication signed by the ExecutiveSecretary, "by authority of the President", whereby, based on "finding that aprima facie case existsagainst you for gross negligence and conduct prejudicial to the public interest", petitioner was"hereby suspended, upon receipt hereof, pending investigation of the above charges."

On March 18, 1968, petitioner applied to this Court, reiterating the contentions advanced in his letterto the Secretary of Justice, claiming lack of jurisdiction and abuse of discretion, and praying forrestraining writs. In their answer respondents admit the facts but denied that petitioner, as Land


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Registration Commissioner, exercises judicial functions, or that the petitioner may be considered aJudge of First Instance within the purview of the Judiciary Act and Revised Rules of Court 140; thatthe function of investigating charges against public officers is administrative or executive in nature;that the Legislature may not charge the judiciary with non-judicial functions or duties except whenreasonably incidental to the fulfillment of judicial duties, as it would be in violation of the principle ofthe separation of powers.

Thus, the stark issue before this Court is whether the Commissioner of Land Registration may onlybe investigated by the Supreme Court, in view of the conferment upon him by the Statutesheretofore mentioned (Rep. Act 1151 and Appropriation Laws) of the rank and privileges of a Judgeof the Court of First Instance.

First to militate against petitioner's stand is the fact that section 67 of the Judiciary Act providing forinvestigation, suspension or removal of Judges, specifically recites that "No District Judge shall beseparated or removed from office by the President of the Philippines unless sufficient cause shallexist in the judgment of the Supreme Court . . ." and it is nowhere claimed, much less shown, thatthe Commissioner of Land Registration is a District Judge, or in fact a member of the Judiciary at all.

In the second place, petitioner's theory that the grant of "privileges of a Judge of First Instance"includes by implication the right to be investigated only by the Supreme Court and to be suspendedor removed upon its recommendation, would necessarily result in the same right being possessed bya variety of executive officials upon whom the Legislature had indiscriminately conferred the sameprivileges. These favoured officers include (a) the Judicial Superintendent of the Department ofJustice (Judiciary Act, sec. 42); (b) the Assistant Solicitors General, seven in number (Rep. Act No.4360); (c) the City Fiscal of Quezon City (R.A. No. 4495); (d) the City Fiscal of Manila (R. A. No.4631) and (e) the Securities and Exchange Commissioner (R. A. No. 5050, s. 2). To adoptpetitioner's theory, therefore, would mean placing upon the Supreme Court the duty of investigatingand disciplining all these officials, whose functions are plainly executive, and the consequentcurtailment by mere implication from the Legislative grant, of the President's power to discipline andremove administrative officials who are presidential appointees, and which the Constitutionexpressly placed under the President's supervision and control (Constitution, Art. VII, sec. 10[i]).

Incidentally, petitioner's stand would also lead to the conclusion that the Solicitor General, anotherappointee of the President, could not be removed by the latter, since the Appropriation Acts conferupon the Solicitor General the rank and privileges of a Justice of the Court of Appeals, and theseJustices are only removable by the Legislature, through the process of impeachment (Judiciary Act,sec. 24, par. 2).

In our opinion, such unusual corollaries could not have been intended by the Legislature when itgranted these executive officials the rank and privileges of Judges of First Instance. This conclusiongains strength when account is taken of the fact that in the case of the Judges of the Court of

Agrarian Relations and those of the Court of Tax Appeals, the organic statutes of said bodies(Republic Act 1267, as amended by Act 1409; Rep. Act No. 1125) expressly provide that they are to

be removedfrom office for the same causes and in the same mannerprovided by law forJudges ofFirst Instance", or "members of the judiciaryof appellate rank". The same is true of Judges of theCourt of Agrarian Relations (Comm. Act No. 103) and of the Commissioner of Public Service (PublicService Act, Sec. 3). It is thereby shown that where the legislative design is to make the suspensionor removal procedure prescribed for Judges of First Instance applicable to other officers, provision tothat effect is made in plain and unequivocal language.

But the more fundamental objection to the stand of petitioner Noblejas is that, if the Legislature hadreally intended to include in the general grant of "privileges" or "rank and privileges of Judges of the


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Court of First Instance" the right to be investigated by the Supreme Court, and to be suspended orremoved only upon recommendation of that Court, then such grant of privileges would beunconstitutional, since it would violate the fundamental doctrine of separation of powers, by chargingthis court with the administrative function of supervisory control over executive officials, andsimultaneously reducing pro tanto the control of the Chief Executive over such officials.

Justice Cardozo ruled in In re Richardson et al., Connolly vs. Scudder (247 N. Y. 401, 160 N. E.655), saying:

There is no inherent power in the Executive or Legislature to charge the judiciary withadministrative functions except when reasonably incidental to the fulfillment of judicial duties.

The United States Supreme Court said in Federal Radio Commission vs. General Electric Co., et al.,281 U.S. 469, 74 Law. Ed., 972,

But this court cannot be invested with jurisdiction of that character, whether for purposes ofreview or otherwise. It was brought into being by the judiciary article of the Constitution, isinvested with judicial power only and can have no jurisdiction other than of cases and

controversies falling within the classes enumerated in that article. It cannot give decisionswhich are merely advisory; nor can it exercise or participate in the exercise of functionswhich are essentially legislative or administrative. Keller v. Potomac Electric PowerCo., supra (261 U.S. 444, 67 L. ed. 736, 43 Sup. Ct. Rep. 445) and cases cited; PostumCereal Co. vs. California Fig Nut Co. supra (272 U.S. 700, 701, 71 L. ed. 481, 47 Sup. Ct.Rep. 284); Liberty Warehouse Co. v. Grannis, 273 U.S. 70, 74, 71 L. ed. 541, 544, 47 Sup.Ct. Rep. 282; Willing v. Chicago Auditorium Asso. 277 U.S. 274, 289, 72 L. ed. 880, 884, 48Sup. Ct. Rep. 507; Ex parte Bakelite Corp. 279 U.S. 438, 449, 73 L. ed. 789, 793, 49 Sup.Ct. Rep. 411. (Federal Radio Commission v. General Electric Company, 281 U.S. 469, 74 L.ed. 972.) (Emphasis supplied.)

In this spirit, it has been held that the Supreme Court of the Philippines and its members shouldnot and cannotbe required to exercise any power or to perform any trust or to assume any duty not

pertaining to or connected with the administration of judicial functions; and a law requiring theSupreme Court to arbitrate disputes between public utilities was pronounced void in Manila ElectricCo. vs. Pasay Transportation Co. (57 Phil. 600).1wph1.t

Petitioner Noblejas seeks to differentiate his case from that of other executive officials by claimingthat under Section 4 of Republic Act No. 1151, he is endowed with judicial functions. The sectioninvoked runs as follows:

Sec. 4. Reference of doubtful matters to Commissioner of Land Registration. When theRegister of Deeds is in doubt with regard to the proper step to be taken or memorandum tobe made in pursuance of any deed, mortgage, or other instrument presented to him forregistration, or where any party in interest does not agree with the Register of Deeds with

reference to any such matter, the question shall be submitted to the Commissioner of LandRegistration either upon the certification of the Register of Deeds, stating the question uponwhich he is in doubt, or upon the suggestion in writing by the party in interest; and thereuponthe Commissioner, after consideration of the matter shown by the records certified to him,and in case of registered lands, after notice to the parties and hearing, shall enter an orderprescribing the step to be taken or memorandum to be made. His decision in such casesshall be conclusive and binding upon all Registers of Deeds: Provided, further, That, when aparty in interest disagrees with the ruling or resolution of the Commissioner and the issue


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involves a question of law, said decision may be appealed to the Supreme Court within thirtydays from and after receipt of the notice thereof.

Serious doubt may well be entertained as to whether the resolution of a consulta by a Register ofDeeds is a judicial function, as contrasted with administrative process. It will be noted that by specificprovision of the section, the decision of the Land Registration Commissioner "shall be conclusive

and binding upon all Registers of Deeds" alone, and not upon other parties. This limitation1

in effectidentifies the resolutions of the Land Registration Commissioner with those of any other bureaudirector, whose resolutions or orders bind his subordinates alone. That the Commissioner'sresolutions are appealable does not prove that they are not administrative; any bureau director'sruling is likewise appealable to the corresponding department head.

But even granting that the resolution ofconsultas by the Register of Deeds should constitute ajudicial (or more properly quasi judicial) function, analysis of the powers and duties of the LandRegistration Commissioner under Republic Act No. 1151, sections 3 and 4, will show that theresolution ofconsultas are but a minimal portion of his administrative or executive functions andmerely incidental to the latter.

Conformably to the well-known principle of statutory construction that statutes should be given,whenever possible, a meaning that will not bring them in conflict with the Constitution, 2 We areconstrained to rule that the grant by Republic Act 1151 to the Commissioner of Land Registration ofthe "same privileges as those of a Judge of the Court of First Instance" did not include, and was notintended to include, the right to demand investigation by the Supreme Court, and to be suspended orremoved only upon that Court's recommendation; for otherwise, the said grant of privileges would beviolative of the Constitution and be null and void. Consequently, the investigation and suspension ofthe aforenamed Commissioner pursuant to sections 32 and 34 of the Civil Service Law (R. A. 2260)are neither abuses of discretion nor acts in excess of jurisdiction.

WHEREFORE, the writs of prohibition and injunction applied for are denied, and the petition isordered dismissed. No costs.

Dizon, Makalintal, Bengzon, J.P., Zaldivar, Sanchez, Castro, Angeles and Fernando, JJ., concur.1wph1.t Concepcion, C.J., is on leave.


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FIRST DIVISION

[G.R. No. 154409. June 21, 2004]

Spouses NOEL and JULIEABRIGO, petitioners, vs. ROMANA DE VERA, respondent.

D E C I S I O N

PANGANIBAN,J .:

Between two buyers of the same immovable property registered underthe Torrens system, the law gives ownership priority to (1) the first registrant

in good faith; (2) then, the first possessor in good faith; and (3) finally, thebuyer who in good faith presents the oldest title. This provision, however,does not apply if the property is not registered under theTorrens system.

The Case

Before us is a Petition for Review[1]

under Rule 45 of the Rules of Court,seeking to set aside the March 21, 2002 Amended Decision

[2]and the July 22,

2002 Resolution

[3]

of the Court of Appeals (CA) in CA-GR CV No. 62391. TheAmended Decision disposed as follows:

WHEREFORE, the dispositive part of the original DECISION of this case,

promulgated on November 19, 2001, is SET ASIDE and another one is

entered AFFIRMING in part andREVERSING in part the judgment appealed from,

as follows:

1. Declaring [Respondent] Romana de Vera the rightful owner and with

better right to possess the property in question, being an innocent

purchaser for value therefor;

2. Declaring Gloria Villafania [liable] to pay the following to

[Respondent] Romana de Vera and to [Petitioner-]Spouses [Noel and

Julie] Abrigo, to wit:

As to [Respondent] Romana de Vera:
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1. P300,000.00 plus 6% per annum as actual damages;

2. P50,000.00 as moral damages;

3. P50,000.00 as exemplary damages;

4. P30,000.00 as attorneys fees; and

5. Cost of suit.

As to [Petitioner-]Spouses [Noel and Julie] Abrigo:

1. P50,000.00 as moral damages;

2. P50,000.00 as exemplary damages;

3. P30,000.00 as attorneys fees;

4. Cost of suit.[4]

The assailed Resolution denied reconsideration.

The Facts

Quoting the trial court, the CA narrated the facts as follows:

As culled from the records, the following are the pertinent antecedents amply

summarized by the trial court:

On May 27, 1993, Gloria Villafania sold a house and lot located at Banaoang,

Mangaldan, Pangasinan and covered by Tax Declaration No. 1406 to Rosenda Tigno-

Salazar and Rosita Cave-Go. The said sale became a subject of a suit for annulment

of documents between the vendor and the vendees.

On December 7, 1993, the Regional Trial Court, Branch 40 of Dagupan City

rendered judgment approving the Compromise Agreement submitted by the

parties. In the said Decision, Gloria Villafania was given one year from the date of

the Compromise Agreement to buy back the house and lot, and failure to do so would

mean that the previous sale in favor of Rosenda Tigno-Salazar and Rosita Cave-Go

shall remain valid and binding and the plaintiff shall voluntarily vacate the premises

without need of any demand. Gloria Villafania failed to buy back the house and lot,

so the [vendees] declared the lot in their name.

Unknown, however to Rosenda Tigno-Salazar and Rosita Cave-Go, Gloria Villafania

obtained a free patent over the parcel of land involved [on March 15, 1988 as

evidenced by OCT No. P-30522]. The said free patent was later on cancelled by TCT

No. 212598 on April 11, 1996.
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On October 16, 1997, Rosenda Tigno-Salazar and Rosita Cave-Go, sold the house

and lot to the herein [Petitioner-Spouses Noel and Julie Abrigo].

On October 23, 1997, Gloria Villafania sold the same house and lot to Romana de

Vera x x x. Romana de Vera registered the sale and as a consequence, TCT No.

22515 was issued in her name.

On November 12, 1997, Romana de Vera filed an action for Forcible Entry and

Damages against [Spouses Noel and Julie Abrigo] before the Municipal Trial Court of

Mangaldan, Pangasinan docketed as Civil Case No. 1452. On February 25, 1998, the

parties therein submitted a Motion for Dismissal in view of their agreement in the

instant case that neither of them can physically take possession of the property in

question until the instant case is terminated. Hence the ejectment case was

dismissed.[5]

Thus, on November 21, 1997, [petitioners] filed the instant case [withthe Regional Trial Court of Dagupan City] for the annulment of documents,

injunction, preliminary injunction, restraining order and damages [against respondent

and Gloria Villafania].

After the trial on the merits, the lower court rendered the assailed Decision

dated January 4, 1999, awarding the properties to [petitioners] as well as damages.

Moreover, x x x Gloria Villafania was ordered to pay [petitioners and private

respondent] damages and attorneys fees.

Not contented with the assailed Decision, both parties [appealed to the CA].[6]

Ruling of the Court of Appeals

In its original Decision promulgated on November 19, 2001, the CA heldthat a void title could not give rise to a valid one and hence dismissed theappeal of Private Respondent Romana de Vera.

[7]Since Gloria Villafania had

already transferred ownership to Rosenda Tigno-Salazar and Rosita Cave-

Go, the subsequent sale to De Vera was deemed void.The CA also dismissed the appeal of Petitioner-Spouses Abrigo and found

no sufficient basis to award them moral and exemplary damages andattorneys fees.

On reconsideration, the CA issued its March 21, 2002 Amended Decision,finding Respondent De Vera to be a purchaser in good faith and for
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value. The appellate court ruled that she had relied in good faith onthe Torrens title of her vendor and must thus be protected.

[8]

Hence, this Petition.[9]

Issues

Petitioners raise for our consideration the issues below:

1. Whether or not the deed of sale executed by Gloria Villafania in favor

of [R]espondent Romana de Vera is valid.

2. Whether or not the [R]espondent Romana de Vera is a purchaser for

value in good faith.

3. Who between the petitioners and respondent has a better title over the

property in question.[10]

In the main, the issues boil down to who between petitioner-spouses andrespondent has a better right to the property.

The Courts Ruling

The Petition is bereft of merit.

Main Issue:Better Right over the Property

Petitioners contend that Gloria Villafania could not have transferred theproperty to Respondent De Vera because it no longer belonged toher.

[11]They further claim that the sale could not be validated, since

respondent was not a purchaser in good faith and for value.

[12]

Law on Double Sale

The present case involves what in legal contemplation was a doublesale. On May 27, 1993, Gloria Villafania first sold the disputed property to
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Rosenda Tigno-Salazar and Rosita Cave-Go, from whom petitioners, in turn,derived their right. Subsequently, on October 23, 1997, a second sale wasexecuted by Villafania with Respondent Romana de Vera.

Article 1544 of the Civil Code states the law on double sale thus:

Art. 1544. If the same thing should have been sold to different vendees, the

ownership shall be transferred to the person who may have first taken possession

thereof in good faith, if it should be movable property.

Should it be immovable property, the ownership shall belong to the person acquiring

it who in good faith first recorded it in the Registry of Property.

Should there be no inscription, the ownership shall pertain to the person who in good

faith was first in the possession; and, in the absence thereof, to the person who

presents the oldest title, provided there is good faith.

Otherwise stated, the law provides that a double sale of immovablestransfers ownership to (1) the first registrant in good faith; (2) then, the firstpossessor in good faith; and (3) finally, the buyer who in good faith presentsthe oldest title.

[13]There is no ambiguity in the application of this law with

respect to lands registered under the Torrens system.

This principle is in full accord with Section 51 of PD 1529[14]

whichprovides that no deed, mortgage, lease or other voluntary instrument -- excepta will -- purporting to convey or affect registered land shall take effect as a

conveyance or bind the land until its registration.[15]Thus, if the sale is notregistered, it is binding only between the seller and the buyer but it does notaffect innocent third persons.

[16]

In the instant case, both Petitioners Abrigo and respondent registered thesale of the property. Since neither petitioners nor their predecessors (Tigno-Salazar and Cave-Go) knew that the property was covered bythe Torrens system, they registered their respective sales under Act3344.

[17]For her part, respondent registered the transaction under

the Torrens system[18]

because, during the sale, Villafania had presented the

transfer certificate of title (TCT) covering the property.[19]

Respondent De Vera contends that her registration under

the Torrens system should prevail over that of petitioners who recorded theirsunder Act 3344. De Vera relies on the following insight of Justice Edgardo L.Paras:
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x x x If the land is registered under the Land Registration Act (and has therefore a

Torrens Title), and it is sold but the subsequent sale is registered not under the Land

Registration Act but under Act 3344, as amended, such sale is not considered

REGISTERED, as the term is used under Art. 1544 x x x.[20]

We agree with respondent. It is undisputed that Villafania had been issueda free patent registered as Original Certificate of Title (OCT) No. P-30522.

[21]The OCT was later cancelled by Transfer Certificate of Title (TCT)

No. 212598, also in Villafanias name.[22]

As a consequence of the sale, TCTNo. 212598 was subsequently cancelled and TCT No. 22515 thereafterissued to respondent.

Soriano v. Heirs of Magali[23]

held that registration must be done in theproper registry in order to bind the land. Since the property in dispute in thepresent case was already registered under the Torrens system, petitioners

registration of the sale under Act 3344 was not effective for purposes of Article1544 of the Civil Code.

More recently, inNaawan Community Rural Bank v. Court ofAppeals,

[24]the Court upheld the right of a party who had registered the sale

of land under the Property Registration Decree, as opposed to another whohad registered a deed of final conveyance under Act 3344. In that case, thepriority in time principle was not applied, because the land was alreadycovered by the Torrens system at the time the conveyance was registeredunder Act 3344. For the same reason, inasmuch as the registration of thesale to Respondent De Vera under the Torrens system was done in goodfaith, this sale must be upheld over the sale registered under Act 3344 toPetitioner-Spouses Abrigo.

Radiowealth Finance Co. v. Palileo[25]

explained the difference in the rulesof registration under Act 3344 and those under the Torrens system in thiswise:

Under Act No. 3344, registration of instruments affecting unregistered lands is

without prejudice to a third party with a better right. The aforequoted phrase has

been held by this Court to mean that the mere registration of a sale in ones favor does

not give him any right over the land if the vendor was not anymore the owner of theland having previously sold the same to somebody else even if the earlier sale was

unrecorded.

The case ofCarumba vs. Court of Appeals[26]is a case in point. It was held therein

that Article 1544 of the Civil Code has no application to land not registered under Act

No. 496. Like in the case at bar, Carumba dealt with a double sale of the same
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unregistered land. The first sale was made by the original owners and was unrecorded

while the second was an execution sale that resulted from a complaint for a sum of

money filed against the said original owners. Applying [Section 33], Rule 39 of the

Revised Rules of Court,[27]this Court held that Article 1544 of the Civil Code cannot

be invoked to benefit the purchaser at the execution sale though the latter was a buyer

in good faith and even if this second sale was registered. It was explained that this isbecause the purchaser of unregistered land at a sheriffs execution sale only steps into

the shoes of the judgment debtor, and merely acquires the latters interest in the

property sold as of the time the property was levied upon.

Applying this principle, x x x the execution sale of unregistered land in favor of

petitioner is of no effect because the land no longer belonged to the judgment debtor

as of the time of the said execution sale.[28]

Petitioners cannot validly argue that they were fraudulently misled into

believing that the property was unregistered. A Torrens title, once registered,serves as a notice to the whole world.

[29]All persons must take notice, and no

one can plead ignorance of the registration.[30]

Good-Faith Requirement

We have consistently held that Article 1544 requires the second buyer toacquire the immovable in good faith andto register it in good faith.

[31]Mere

registration of title is not enough; good faith must concur with theregistration.[32]

We explained the rationale in Uraca v. Court ofAppeals,

[33]which we quote:

Under the foregoing, the prior registration of the disputed property by the second

buyer does not by itself confer ownership or a better right over the property. Article

1544 requires that such registration must be coupled with good faith. Jurisprudence

teaches us that (t)he governing principle isprimus tempore, potior jure (first in time,

stronger in right). Knowledge gained by the first buyer of the second sale cannot

defeat the first buyers rights except where the second buyer registers ingood faith the

second sale aheadof the first, as provided by the Civil Code. Such knowledge of thefirst buyer does not bar her from availing of her rights under the law, among them, to

registerfirsther purchase as against the second buyer. But in converso, knowledge

gained by the second buyer of the first sale defeats his rights even if he is first to

register the second sale, since such knowledge taints his prior registration with bad

faith. This is the price exacted by Article 1544 of the Civil Code for the second buyer

being able to displace the first buyer; that before the second buyer can obtain priority
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over the first, he must show that he acted in good faith throughout (i.e. in ignorance of

the first sale and of the first buyers rights) ---- from the time of acquisition until the

title is transferred to him by registration, or failing registration, by delivery of

possession.[34](Italics supplied)

Equally important, under Section 44 of PD 1529, every registered ownerreceiving a certificate of title pursuant to a decree of registration, and everysubsequent purchaser of registered land taking such certificate for value andin good faith shall hold the same free from all encumbrances, except thosenoted and enumerated in the certificate.

[35]Thus, a person dealing with

registered land is not required to go behind the registry to determine thecondition of the property, since such condition is noted on the face of theregister or certificate of title.

[36] Following this principle, this Court has

consistently held as regards registered land that a purchaser in good faithacquires a good title as against all the transferees thereof whose rights arenot recorded in the Registry of Deeds at the time of the sale.[37]

Citing Santiago v. Court of Appeals,[38]

petitioners contend that their priorregistration under Act 3344 is constructive notice to respondent and negatesher good faith at the time she registered the sale. Santiago affirmed thefollowing commentary of Justice Jose C. Vitug:

The governing principle isprius tempore, potior jure (first in time, stronger in right).

Knowledge by the first buyer of the second sale cannot defeat the first buyer's rights

except when the second buyer first registers in good faith the second sale (Olivares vs.

Gonzales, 159 SCRA 33). Conversely, knowledge gained by the second buyer of thefirst sale defeats his rights even if he is first to register, since such knowledge taints

his registration with bad faith (see alsoAstorga vs. Court of Appeals, G.R. No

58530, 26 December 1984) In Cruz vs. Cabana (G.R. No. 56232, 22 June 1984; 129

SCRA 656), it was held that it is essential, to merit the protection of Art. 1544, second

paragraph, that the second realty buyer must act in good faith in registering his deed

of sale (citing Carbonell vs. Court of Appeals, 69 SCRA 99, Crisostomo vs. CA, G.R.

95843, 02 September 1992).

x x x x x x x x x

Registration of the second buyer under Act 3344, providing for the registration of all

instruments on land neither covered by the Spanish Mortgage Law nor the Torrens

System (Act 496), cannot improve his standing since Act 3344 itself expresses that

registration thereunder would not prejudicepriorrights in good faith (see Carumba

vs. Court of Appeals, 31 SCRA 558). Registration, however, by the first buyer

under Act 3344 can have the effect of constructive notice to the second buyer that
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can defeat his right as such buyer in good faith (seeArts. 708-709, Civil Code; see

alsoRevilla vs. Galindez, 107 Phil. 480; Taguba vs. Peralta, 132 SCRA 700). Art.

1544 has been held to be inapplicable to execution sales of unregistered land, since

the purchaser merely steps into the shoes of the debtor and acquires the latter's interest

as of the time the property is sold (Carumba vs. Court of Appeals, 31 SCRA 558; see

alsoFabian vs. Smith, Bell & Co., 8 Phil. 496) or when there is only one sale(Remalante vs. Tibe, 158 SCRA 138).[39](Emphasis supplied)

Santiago was subsequently applied in Bayoca v. Nogales,[40]

which held:

Verily, there is absence of prior registration in good faith by petitioners of the second

sale in their favor. As stated in the Santiago case, registration by the first buyer under

Act No. 3344 can have the effect of constructive notice to the second buyer that can

defeat his right as such buyer. On account of the undisputed fact of registration under

Act No. 3344 by [the first buyers], necessarily, there is absent good faith in the

registration of the sale by the [second buyers] for which they had been issuedcertificates of title in their names. x x x.[41]

Santiago and Bayoca are not in point. In Santiago, the first buyersregistered the sale under the Torrens system, as can be inferred from theissuance of the TCT in their names.

[42]There was no registration under Act

3344. In Bayoca, when the first buyer registered the sale under Act 3344, theproperty was still unregistered land.

[43]Such registration was therefore

considered effectual.

Furthermore, Revilla and Taguba, which are cited in Santiago, are not onall fours with the present case. In Revilla, the first buyer did not register thesale.

[44]In Taguba, registration was not an issue.

[45]

As can be gathered from the foregoing, constructive notice to the secondbuyer through registration under Act 3344 does not apply if the property isregistered under theTorrens system, as in this case.

We quote below the additional commentary of Justice Vitug, which wasomitted in Santiago. This omission was evidently the reason why petitionermisunderstood the context of the citation therein:

"The registration contemplated under Art. 1544 has been held to refer to registration

under Act 496 Land Registration Act (now PD 1529) which considers the act of

registration as the operative act that binds the land (seeMediante vs. Rosabal, 1 O.G.

[12] 900, Garcia vs. Rosabal, 73 Phil 694). On lands covered by the Torrens System,

the purchaser acquires such rights and interest as they appear in the certificate of title,

unaffected by any prior lien or encumbrance not noted therein. The purchaser is not
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required to explore farther than what the Torrens title, upon its face, indicates. The

only exception is where the purchaser has actual knowledge of a flaw or defect in the

title of the seller or of such liens or encumbrances which, as to him, is equivalent to

registration (see Sec. 39, Act 496;Bernales vs. IAC, G.R. 75336, 18 October

1988;Hernandez vs. Sales, 69 Phil 744; Tajonera vs. Court of Appeals, L-26677, 27

March 1981),"[46]

Respondentin Good Faith

The Court of Appeals examined the facts to determine whetherrespondent was an innocent purchaser for value.

[47]After its factual findings

revealed that Respondent De Vera was in good faith, it explained thus:

x x x. Gloria Villafania, [Respondent] De Veras vendor, appears to be the

registered owner. The subject land was, and still is, registered in the name of Gloria

Villafania. There is nothing in her certificate of title and in the circumstances of the

transaction or sale which warrant [Respondent] De Vera in supposing that she

need[ed] to look beyond the title. She had no notice of the earlier sale of the land to

[petitioners]. She ascertained and verified that her vendor was the sole owner and in

possession of the subject property by examining her vendors title in the Registry of

Deeds and actually going to the premises. There is no evidence in the record showing

that when she bought the land on October 23, 1997, she knew or had the slightest

notice that the same was under litigation in Civil Case No. D-10638 ofthe Regional Trial Court of Dagupan City, Branch 40, between Gloria Villafania and

[Petitioners] Abrigo. She was not even a party to said case. In sum, she testified

clearly and positively, without any contrary evidence presented by the [petitioners],

that she did not know anything about the earlier sale and claim of the spouses Abrigo,

until after she had bought the same, and only then when she bought the same, and

only then when she brought an ejectment case with the x x x Municipal Court of

Mangaldan, known as Civil Case No. 1452. To the [Respondent] De Vera, the only

legal truth upon which she had to rely was that the land is registered in the name of

Gloria Villafania, her vendor, and that her title under the law, is absolute and

indefeasible. x x x.[48]

We find no reason to disturb these findings, which petitioners have notrebutted. Spouses Abrigo base their position only on the general avermentthat respondent should have been more vigilant prior to consummating thesale. They argue that had she inspected the property, she would have foundpetitioners to be in possession.

[49]
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This argument is contradicted, however, by the spouses own admissionthat the parents and the sister of Villafania were still the actual occupants inOctober 1997, when Respondent De Vera purchased the property.

[50]The

family members may reasonably be assumed to be Villafanias agents, whohad not been shown to have notified respondent of the first sale when she

conducted an ocular inspection. Thus, good faith on respondents partstands.

WHEREFORE, the Petition is DENIED and the assailedDecisionAFFIRMED. Costs against petitioners.

SO ORDERED.
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THIRD DIVISION

SPS. LITA DE LEON and

FELIX RIO TARROSA,

Petitioners,

- versus -

ANITA B. DE LEON, DANILO B.

DE LEON, and VILMA B.

DELEON,Respondents.

G.R. No. 185063

Present:

YNARES-SANTIAGO, Chairperson,

CHICO-NAZARIO,VELASCO, JR.,

ACHURA, andPERALTA,JJ.

Promulgated:

July 23, 2009

x-----------------------------------------------------------------------------------------x

D E C I S I O N

VELASCO, JR., J .:The Case

Before us is a Petition for Review on Certiorari under Rule 45 assailing and

seeking to set aside the Decision[1]

and Resolution[2]

dated August 27, 2008 andOctober 20, 2008, respectively, of the Court of Appeals (CA) in CA-G.R. CV No.

88571. The CA affirmed with modification the October 4, 2006 Decision[3]inCivil Case No. Q04-51595 of the Regional Trial Court (RTC), Branch 22

in Quezon City.

The Facts

On July 20, 1965, Bonifacio O. De Leon, then single, and the PeoplesHomesite and Housing Corporation (PHHC) entered into a Conditional Contract to

Sell for the purchase on installment of a 191.30 square-meter lot situatedin Fairview, Quezon City. Subsequently, on April 24, 1968, Bonifacio married

Anita de Leon in a civil rite officiated by the Municipal Mayor of Zaragosa, NuevaEcija. To this union were born Danilo and Vilma.
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Following the full payment of the cost price for the lot thus purchased,

PHHC executed, on June 22, 1970, a Final Deed of Sale in favor ofBonifacio. Accordingly, Transfer Certificate of Title (TCT) No. 173677 was issued

on February 24, 1972 in the name of Bonifacio, single.

Subsequently, Bonifacio, for PhP 19,000, sold the subject lot to her sister,

Lita, and husband Felix Rio Tarrosa (Tarrosas), petitioners herein. The conveyingDeed of Sale dated January 12, 1974 (Deed of Sale) did not bear the written

consent and signature of Anita.

Thereafter, or on May 23, 1977, Bonifacio and Anita renewed their vows in

a church wedding at St. John the Baptist Parish in San Juan, Manila.

On February 29, 1996, Bonifacio died.

Three months later, the Tarrosas registered the Deed of Sale and had TCTNo. 173677 canceled. They secured the issuance in their names of TCT No. N-

173911 from the Quezon City Register of Deeds.

Getting wind of the cancellation of their fathers title and the issuance of

TCT No. N-173911, Danilo and Vilma filed on May 19, 2003 a Notice of Adverse

Claim before the Register of Deeds of Quezon City to protect their rights over thesubject property. Very much later, Anita, Danilo, and Vilma filed a reconveyance

suit before the RTC in Quezon City. In their complaint, Anita and her children

alleged, among other things, that fraud attended the execution of the Deed of Saleand that subsequent acts of Bonifacio would show that he was still the owner of the

parcel of land. In support of their case, they presented, inter alia, the followingdocuments:

a. A Real Estate Mortgage execution by Bonifacio in favor of spousesCesar Diankinay and Filomena Almero on July 22, 1977.

b. A Civil Complaint filed by Bonifacio against spouses Cesar

Diankinay and Filomena Almero on November 27, 1979 for nullification of the

Real Estate Mortgage.

c. The Decision issued by the Court of First Instance of

Rizal, Quezon City, promulgated on July 30, 1982, nullifying the Real EstateMortgage.

[4]
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The Tarrosas, in their Answer with Compulsory Counterclaim, averred that

the lot Bonifacio sold to them was his exclusive property inasmuch as he was stillsingle when he acquired it from PHHC. As further alleged, they were not aware of

the supposed marriage between Bonifacio and Anita at the time of the execution of

the Deed of Sale.

After several scheduled hearings, both parties, assisted by their respectivecounsels, submitted a Joint Stipulation of Facts with Motion, to wit:

1. The parties have agreed to admit the following facts:

a. Bonifacio O. De Leon, while still single x x x, purchased from the

[PHHC] through a Conditional Contract to Sellon July 20, 1965 a parcel of landwith an area of 191.30 square meters situated in Fairview, Quezon City for

P841.72;

b. On April 24, 1968, Bonifacio O. De Leon married plaintiff AnitaB. De Leon before the Municipal Mayor of Zaragosa, Nueva Ecija. Both parties

stipulate that said marriage is valid and binding under the laws of the Philippines;

c. On June 22, 1970, Bonifacio O. De Leon paid [PHHC] the total

amount of P1,023.74 x x x. The right of ownership over the subject parcel of land

was transferred to the late Bonifacio O. De Leon on June 22, 1970, upon the fullpayment of the total [price] of P1,023.74 and upon execution of theFinal Deed of

Sale;

d. After full payment, Bonifacio O. De Leon was issued [TCT] No.

173677 on February 24, 1972;

e. On January 12, 1974, Bonifacio O. De Leon executed aDeed ofSale in favor of defendants-spouses Felix Rio Tarrosa and Lita O. De Leon

disposing the parcel of land under TCT No. 173677 for valuable consideration

amount of P19,000.00 and subscribed before Atty. Salvador R. Aguinaldo whowas commissioned to [notarize] documents on said date. The parties stipulate that

theDeed of Sale is valid and genuine. However, plaintiff Anita De Leon was not

a signatory to theDeed of Sale executed on January 12, 1974;

f. That plaintiff Anita B. De Leon and the late Bonifacio O. De Leon

were married in church rites on May 23, 1977 x x x;

g. The late Bonifacio O. De Leon died on February 29, 1996 at

the UST Hospital, Espaa, Manila;

h. The said Deed of Sale executed on January 12, 1974 wasregistered on May 8, 1996 before the Office of the Register of Deeds of Quezon


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City and [TCT] No. N-173911 was issued to Lita O. De Leon and Felix Rio

Tarrosa.[5]

The Ruling of the Trial Court

On October 4, 2006, the RTC, on the finding that the lot in question was theconjugal property of Bonifacio and Anita, rendered judgment in favor of Anita and

her children. The dispositive portion of the decision reads:

WHEREFORE, premises considered, judgment is hereby rendered in favor

of plaintiffs and against defendants in the following manner:

(1) Declaring the Deed of Sale dated January 12, 1974 executed by

the late Bonifacio O. De Leon in favor of defendants-spouses Lita De Leon and

Felix Rio Tarrosa void ab initio;

(2) Directing the Register of Deed of Quezon City to cancel Transfer

Certificate of Title No. N-173911 in the name of Lita O. De Leon, married toFelix Rio Tarrosa and restore Transfer Certificate of Title No. 173667 in the

name of Bonifacio O. De Leon;

(3) Ordering the defendants-spouses to pay plaintiffs the following

sums:

(a) P25,000.00 as moral damages;

(b) P20,000.00 as exemplary damages;(c) P50,000.00 as attorneys fees plus appearance fee of P2,500.00 per

court appearance;

(d) Costs of this suit.

SO ORDERED.

Aggrieved, the Tarrosas appealed to the CA. As they would submit, the

RTC erred:

(1) in finding for the plaintiffs-appellees by declaring that the land subject

matter of the case is conjugal property;

(2) in not declaring the land as the exclusive property of Bonifacio O. DeLeon when sold to defendant-appellants;

(3) in ruling that defendant-appellants did not adduce any proof that the

property was acquired solely by the efforts of Bonifacio O. De Leon;

(4) in declaring that one-half of the conjugal assets does not vest to Bonifacio

O. De Leon because of the absence of liquidation;

(5) in cancelling TCT No. N-173911 and restored TCT No. [173677] in thename of Bonifacio O. De Leon;


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(6) in awarding moral and exemplary damages and attorneys fees to the

plaintiffs-appellees.[6]

The Ruling of the Appellate Court

On August 27, 2008, the CA rendered a decision affirmatory of that of the

RTC, save for the award of damages, attorneys fees, and costs of suit which the

appellate court ordered deleted. Thefallo of the CA decision reads:

WHEREFORE, in view of the foregoing, the assailed decision dated

October 4, 2006, of the Regional Trial Court, Branch 22, Quezon City in Civil

Case No. Q-04-51595 is hereby AFFIRMED with MODIFICATION, in that theaward of moral and exemplary damages as well as attorneys fees, appearance fee

and costs of suit are hereby DELETED.

SO ORDERED.

Just like the RTC, the CA held that the Tarrosas failed to overthrow the legal

presumption that the parcel of land in dispute was conjugal. The appellate courtheld further that the cases they cited were inapplicable.

As to the deletion of the grant of moral and exemplary damages, the CA, in

gist, held that no evidence was adduced to justify the award. Based on the same

reason, it also deleted the award of attorneys fees and costs of suit.

The Tarrosas moved but was denied reconsideration by the CA in its equally

assailed resolution of October 20, 2008.

Hence, they filed this petition.

The Issues

I

Whether the [CA] gravely erred in concluding that the land purchased oninstallment by Bonifacio O. De Leon before marriage although some installments

were paid during the marriage is conjugal and not his exclusive property.

II


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Whether the [CA] gravely erred in ruling that theLorenzo, et al. vs. Nicolas, et

al., andAlvarez vs. Espiritu cases do not apply in the case at bar because in the

latter the land involved is not a friar land unlike in the former.

III

Whether the [CA] gravely erred in affirming the decision of the trial court a quowhich ruled that petitioners did not adduce any proof that the land was acquired

solely by the efforts of Bonifacio O. De Leon.

IV

Whether the court of appeals gravely erred in affirming the decision of the trial

court which ruled that one-half (1/2) of the conjugal assets do not vest toBonifacio O. De Leon because of the absence of liquidation.

Our Ruling

The petition lacks merit.

The Subject Property is theConjugal Property of Bonifacio and Anita

The first three issues thus raised can be summed up to the question of

whether or not the subject property is conjugal.

Petitioners assert that, since Bonifacio purchased the lot from PHHC oninstallment before he married Anita, the land was Bonifacios exclusive property

and not conjugal, even though some installments were paid and the title was issued

to Bonifacio during the marriage. In support of their position, petitionersciteLorenzo v. Nicolas[7]andAlvarez v. Espiritu.[8]

We disagree.

Article 160 of the 1950 Civil Code, the governing provision in effect at the

time Bonifacio and Anita contracted marriage, provides that all property of the
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marriage is presumed to belong to the conjugal partnership unless it is proved that

it pertains exclusively to the husband or the wife. For the presumption to arise, itis not, as Tan v. Court of Appeals[9]teaches, even necessary to prove that the

property was acquired with funds of the partnership. Only proof of acquisition

during the marriage is needed to raise the presumption that the property isconjugal. In fact, even when the manner in which the properties were acquired

does not appear, the presumption will still apply, and the properties will still beconsidered conjugal.[10]

In the case at bar, ownership over what was once a PHHC lot and covered by

the PHHC-Bonifacio Conditional Contract to Sell was only transferred during the

marriage of Bonifacio and Anita. It is well settled that a conditional sale is akin, ifnot equivalent, to a contract to sell. In both types of contract, the efficacy or

obligatory force of the vendors obligation to transfer title is subordinated to the

happening of a future and uncertain event, usually the full payment of the purchaseprice, so that if the suspensive condition does not take place, the parties wouldstand as if the conditional obligation had never existed.[11] In other words, in a

contract to sell ownership is retained by the seller and is not passed to the buyer

until full payment of the price, unlike in a contract of sale where title passes upondelivery of the thing sold.[12]

Such is the situation obtaining in the instant case. The conditional contractto sell executed by and between Bonifacio and PHHC on July 20, 1965 provided

that ownership over and title to the property will vest on Bonifacio only upon

execution of the final deed of sale which, in turn, will be effected upon payment ofthe full purchase price, to wit:

14. Titles to the property subject of this contract remains with theCORPORATION and shall pass to, and be transferred in the name of the

APPLICANT only upon the execution of the final Deed of Sale provided for in

the next succeeding paragraph.

15. Upon the full payment by the APPLICANT of the price of the lot above

referred to together with all the interest due thereon, taxes and other charges, and

upon his faithful compliance with all the conditions of this contract theCORPORATION agrees to execute in favor of the APPLICANT a final deed ofsale of the aforesaid land, and the APPLICANT agrees to accept said deed, as full

performance by the CORPORATION of its covenants and undertakings

hereunder.[13]

x x x
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Evidently, title to the property in question only passed to Bonifacio after he

had fully paid the purchase price on June 22, 1970. This full payment, to stress,was made more than two (2) years after his marriage to Anita on April 24,

1968. In net effect, the property was acquired during the existence of the marriage;

as such, ownership to the property is, by law, presumed to belong to the conjugalpartnership.

Such presumption is rebuttable only with strong, clear, categorical, and

convincing evidence.[14] There must be clear evidence of the exclusive ownershipof one of the spouses,[15]and the burden of proof rests upon the party asserting

it.[16]

Petitioners argument that the disputed lot was Bonifacios exclusive

property, since it was registered solely in his name, is untenable. The mere

registration of a property in the name of one spouse does not destroy its conjugalnature.[17] What is material is the time when the property was acquired.

Thus, the question of whether petitioners were able to adduce proof to

overthrow the presumption is a factual issue best addressed by the trial court. As amatter of long and sound practice, factual determinations of the trial

courts,[18]especially when confirmed by the appellate court, are accorded great

weight by the Court and, as rule, will not be disturbed on appeal, except for themost compelling reasons.[19] Petitioners have not, as they really cannot, rebut the

presumptive conjugal nature of the lot in question. In this regard, the Court notes

and quotes with approval the following excerpts from the trial courts disposition:

The defendants, however, did not adduce any proof that the property in

question was acquired solely by the efforts of [Bonifacio]. The establishedjurisprudence on the matter leads this Court to the conclusion that the property

involved in this dispute is indeed the conjugal property of the deceased

[Bonifacio] De Leon.

In fact, defendant even admitted that [Bonifacio] brought into his marriage

with plaintiff Anita the said land, albeit in the concept of a possessor only as it

was not yet registered in his name. The property was registered only in 1972during the existence of the marriage. However, the absence of evidence on the

source of funding has called for the application of the presumption under Article

160 in favor of the plaintiffs.[20]

The cases petitioners cited are without governing applicability to this case

simply because they involved a law specifically enacted to govern the disposition
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of and ownership of friar lands. InLorenzo, the Court held that the pervading

legislative intent of Act No. 1120 is to sell the friar lands acquired by theGovernment to actual settlers and occupants of the same.[21] The Court went on

further to say inAlvarezthat under the Friar Lands Act of 1120, the equitable and

beneficial title to the land passes to the purchaser the moment the first installmentis paid and a certificate of sale is issued.[22] Plainly, the said cases are not

applicable here considering that the disputed property is not friar land.

There can be no quibbling that Anitas conformity to the sale of the disputedlot to petitioners was never obtained or at least not formally expressed in the

conveying deed. The parties admitted as much in their Joint Stipulation of Facts

with Motion earlier reproduced. Not lost on the Court of course is the fact thatpetitioners went to the process of registering the deed after Bonifacios death in

1996, some 22 years after its execution. In the interim, petitioners could have had

workbut did nottowards securing Anitas marital consent to the sale.

It cannot be over-emphasized that the 1950 Civil Code is very explicit on the

consequence of the husband alienating or encumbering any real property of the

conjugal partnership without the wifes consent.[23] To a specific point, the sale ofa conjugal piece of land by the husband, as administrator, must, as a rule, be with

the wifes consent. Else, the sale is not valid. So it is that in several cases we

ruled that the sale by the husband of property belonging to the conjugal partnershipwithout the consent of the wife is void ab initio, absent any showing that the latter

is incapacitated, under civil interdiction, or like causes. The nullity, as we have

explained, proceeds from the fact that sale is in contravention of the mandatoryrequirements of Art. 166 of the Code.[24] Since Art. 166 of the Code requires the

consent of the wife before the husband may alienate or encumber any real propertyof the conjugal partnership, it follows that the acts or transactions executed against

this mandatory provision are void except when the law itself authorized their

validity.[25]

Accordingly, the Deed of Sale executed on January 12, 1974 between

Bonifacio and the Tarrosas covering the PHHC lot is void.

Interest in the Conjugal Partnership Is

Merely Inchoate until Liquidation

As a final consideration, the Court agrees with the CA that the sale of one-

half of the conjugal property without liquidation of the partnership is void. Prior tothe liquidation of the conjugal partnership, the interest of each spouse in the
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conjugal assets is inchoate, a mere expectancy, which constitutes neither a legal

nor an equitable estate, and does not ripen into a title until it appears that there areassets in the community as a result of the liquidation and settlement.[26] The

interest of each spouse is limited to the net remainder or remanente liquido

(haber ganancial) resulting from the liquidation of the affairs of the partnershipafter its dissolution.[27] Thus, the right of the husband or wife to one-half of the

conjugal assets does not vest until the dissolution and liquidation of the conjugalpartnership, or after dissolution of the marriage, when it is finally determined that,

after settlement of conjugal obligations, there are net assets left which can bedivided between the spouses or their respective heirs.[28]

Therefore, even on the supposition that Bonifacio only sold his portion of theconjugal partnership, the sale is still theoretically void, for, as previously stated,

the right of the husband or the wife to one-half of the conjugal assets does not vest

until the liquidation of the conjugal partnership.

Nevertheless, this Court is mindful of the fact that the Tarrosas paid a

valuable consideration in the amount of PhP 19,000 for the property in

question. Thus, as a matter of fairness and equity, the share of Bonifacio after theliquidation of the partnership should be liable to reimburse the amount paid by the

Tarrosas. It is a well-settled principle that no person should unjustly enrich

himself at the expense of another.[29]

WHEREFORE, the petition is DENIED. The CA Decision in CA-G.R.

CV No. 88571 is AFFIRMED. Costs against petitioners.

SO ORDERED.
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Republic of the PhilippinesSUPREME COURT

Manila

EN BANC

G.R. No. L-17956 September 30, 1963

ELISA D. GABRIEL, petitioner-appellee,vs.REGISTER OF DEEDS OF RIZAL, respondent,JUANITA R. DOMINGO, oppositor-appellant.

Romualdo D. Celestra for petitioner-appellee.Balcos, Salazar & Associates for oppositor-appellant.

PAREDES,J .:

On January 4, 1960, petitioner herein Elisa D. Gabriel, filed with the Register of Deeds ofManila, an Adverse claim, against the properties registered in the name of oppositor-appellant,Juanita R. Domingo, her sister. As grounds for the adverse claim, petitioner allege

Notwithstanding the registration of the foregoing properties in the name of Juanita R.Domingo, the same properties have been included in the amended inventory of the estate ofthe late Antonia Reyes Vda. de Domingo, filed by Elisa Domingo de Gabriel 1 as they are infact properties acquired by the deceased during her lifetime. The registration of the titles ofthese properties,; should have been made in the name of said Antonia Reyes Vda. deDominga, but due to commission of fraud and deceit, by said Juanita R. Domingo, who was

then living in the same house with the deceased, all the titles of the above stated propertieswere registered instead in her name, thus depriving herein adverse claimant who is likewisean heir of Antonia Reyes Vda. de Domingo of her lawful rights, interests and participationsover said properties.

On the same date, a similar notice of adverse claim was presented by petitioner with theRegister of Deeds of Rizal, on the properties registered in the name of Juanita R. Domingo, locatedin Rizal Province, the ground for which was stated as follows

The foregoing properties an included in the amended inventory of the estate of theirlate mother Antonia Reyes Vda, de Domingo, who is the true owner of said properties, andconsidering that the registrations in the name of Juanita R. Domingo were only madefraudulently, thus depriving herein adverse claimant of her lawful rights, interest andparticipations over said properties.

For the adverse claim on the Manila properties, Domingo presented an opposition, claimingthat the Adverse claim was instituted for (1) Harassment;(2) Had no legal basis; and (3) Had doneand will do irreparable loss her.

The Register of Deeds of Manila, elevated the matter to the Land Registration Commission enConsulta, where in he stated


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Because the undersigned is in doubt as to whether the registration of the claim isproper determination by this Commission.

Oppositor Domingo also asked that the adverse claim of Gabriel on her Rizal properties bedenied, contending that same was presented only to embarrass her that said properties wereacquired by her pursuant to an extrajudicial partition in which the petitioner Gabriel and their mother

(Antonia), were signatories.

On January 13, 1960, the Register of Deeds of Rizal denied registration of the Notice ofAdverse Claim, stating

P.E. No. 90080 NOTICE OF ADVERSE CLAIM has have been found to be legallydefective or otherwise not sufficient in law and is/are therefore, hereby denied on thefollowing ground:

Where there are other provisions of remedies under this Act, the affidavit of adverseclaim is not applicable.

Under date of January 21, 1960, Elisa D. Gabriel appealed the above denial to the LandRegistration Commission.1awphl.nt

On February 17, 1960, the Register of Deeds of Rizal in his letter transmitting the case to theLRC, tried justify his denial to annotate the affidavit of Adverse claim, by pointing out that suchprocedure was not proper contending that petitioner's case does not come under the provisions ofSection 110 of Act 496. if at all, he claims petitioner should have availed Section 98 thereof.

On March 7, 1960, the LRC heard the two cases, and before any of the parties could file hismemorandum, the Register of Deeds of Rizal, presented a Supplemental Memorandum, reiteratinghis stand. In his reply, Gabriel clarified the issue, stating that the question at bar concerns thefraudulent registration by oppositor, of the properties subject of the Adverse claims, and not their

fraudulent acquisition.

The Land Registration Commission, on April 29, 1960, issued a resolution, the pertinentportions of which are reproduced hereinbelow

The only question to be resolved by this Commission in these related consultas theregistration of the two notices of adverse claim filed with the Registries of Manila and Rizal.Whether or not these adverse claims are valid, whether or not they are frivolous and merelyintended to harass, and such other litigious matters raised by the protagonists, are for aCourt of competent jurisdiction, and not for this Commission to decide.

Sec. 110 of Act No. 496 provides that

Whoever claims any part or interest in registered land adverse to theregistered owner, arising subsequent to the date of the original registration, may, ifno other provision is made in this Act for registering the same, make statement inwriting setting forth fully his alleged right or interest, and how or under whomacquired, and a reference to the volume and page of the certificate of title of theregistered owner, and a description of the land in which the right or interest isclaimed.


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The statement shall be signed and sworn to, and shall state the adverseclaimant's residence, and designate a place at which all notices may be served uponhim. This statement shall be entitled to registration as an adverse claim and thecourt, upon petition of any party in interest, shall grant a specific hearing upon thequestion of the validity of such adverse claim and shall enter such decree therein as

justice and equity may require. If the claim is adjudged to be invalid, the registration

shall be cancelled. If in any case the court after notice and hearing shall find that aclaim thus registered was frivolous or vexatious, it may tax the adverse claimant.double or treble the costs in its discretion.

It is believed that the two notices of adverse claim filed both registries substantiallycomply with the above legal requirements. And under paragraph 5 of the LRC Circular No. 2,dated July 10. 1954, where the document sought to be registered is sufficient in law anddrawn up in accordance with existing requirements, it, becomes incumbent upon theRegister of Deeds to perform his ministerial duty without unnecessary delay.

The registration of an invalid adverse claim will not do as much harm as the non-registration of a valid one. The notation of an adverse claim, like that oflis pendens, does notcreate non-existent right or lien and only means that a person who chases or contracts onthe property in dispute does so subject to the result or outcome of the dispute....

x x x x x x x x x

In view of the foregoing facts and considerations, this Commission is of the opinion,and so holds, that the notices of verse claim filed by Elisa D. Gabriel with the Registries ofManila and Rizal are registrable. Registration should not however be confused with validity.The registration of the adverse claim will not by itself alone make them valid. Their validitywill ultimately decided in Special Proceeding No. 2658 or, in alternative, in the moreexpeditious remedy provided for in 110 of Act No. 496, i.e., a speedy hearing upon thequestion the validity of the adverse claim.

Oppositor Domingo moved for a reconsideration of above order, contending, in the main, thata 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, oppositor submits thatthe duties of the Register of Deeds are not wholly ministerial, for they can refuse, and/or suspendthe registration of documents when t

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