G.R. No. L-29972 January 26, 1976 ROSARIO CARBONELL, petitioner, vs.

HONORABLE COURT OF A EALS, JOSE ONCIO, E!!A INFANTE an" RA!ON INFANTE, respondents.

!A#ASIAR, J. Prior to January 27, 1955, respondent Jose Poncio was the owner of the parcel of land herein involve with improvements situated at 179 V. A an !t., !an Juan, "i#al, havin an area of some one hundred ninety$five %195& s'uare meters, more or less, covered (y )*) +o. 5,-, and su(.ect to mort a e in favor of the "epu(lic !avin s /an0 for the sum of P1,5,,.,,. Petitioner "osario *ar(onell, a cousin and ad.acent nei h(or of respondent Poncio, lived in the ad.oinin lot at 177 V. A an !treet. /oth petitioners "osario *ar(onell and respondent 1mma 2nfante o$$%r%" &o 'uy the said lot from Poncio. "espondent Poncio, una'(% &o )%%* u* +,&- &-% ,n.&a((/%n&. due on the mort a e, a**roa0-%" Car'on%(( an" o$$%r%" &o .%(( &o &-% (a&&%r &-% .a," (o&, %10(u",n2 &-% -ou.% +-%r%,n r%.*on"%n& (,3%". *ar(onell accepted the offer and proposed the price of P9.5, per s'uare meter. "espondent Poncio, after havin secured the consent of his wife and parents, accepted the price proposed (y petitioner, on the condition that from the purchase price would come the money to (e paid to the (an0. Petitioner and respondent Jose Poncio then went to the "epu(lic !avin s /an0 and secured the 0on.%n& o$ &-% r%.,"%n& thereof $or -%r &o *ay &-% arr%ar. on &-% /or&2a2% an" &o 0on&,nu% &-% *ay/%n& o$ &-% ,n.&a((/%n&. a. &-%y $a(( "u%. )he amount in arr%ar. r%a0-%" a &o&a( .u/ o$ 247.26. /ut (ecause respondent Poncio had previously told her that &-% /on%y, n%%"%" +a. on(y 255.55, only the latter amount was (rou ht (y petitioner constrainin respondent Jose on0,o &o +,&-"ra+ &-% .u/ o$ 47.55 $ro/ -,. 'an) "%*o.,& +,&- R%*u'(,0 Sa3,n2. Ban). /ut the ne3t day, *%&,&,on%r r%$un"%" &o on0,o &-% .u/ o$ 47.55. )hereafter, *%&,&,on%r a.)%" A&&y. Sa(3a"or R%y%. to prepare the formal deed of sale, which she (rou ht to respondent Poncio to her assumin the mort a ed o(li ation to "epu(lic !avin s /an0. 4pon arrivin at respondent Jose Poncio5s house, however, the latter told petitioner that he could not proceed any more with the sale, (ecause -% -a" a(r%a"y 2,3%n &-% (o& &o r%.*on"%n& E//a In$an&%6 and that -% 0ou(" no& +,&-"ra+ $ro/ -,. "%a( +,&- r%.*on"%n& !r.. In$an&%, even if he were to o to .ail. Petitioner then sou ht to contact respondent 7rs. 2nfante (ut the latter refused to see her. 8n 9e(ruary 5, 1955, *%&,&,on%r .a+ E//a In$an&% %r%0&,n2 a(( aroun" &-% (o& +,&- a 2a&%.

%&,&,on%r 0on.u(&%" A&&y. Jo.% Gar0,a, who a"3,.%" -%r &o *r%.%n& an a"3%r.% 0(a,/ o3%r &-% (an" ,n 6u%.&,on +,&- &-% O$$,0% o$ &-% R%2,.&%r o$ 7%%". o$ R,8a(. Atty. :arcia actually sent a letter of in'uiry to the "e ister of ;eeds and "%/an" (%&&%r. &o *r,3a&% r%.*on"%n&. Jo.% on0,o an" E//a In$an&%. 2n his answer to the complaint on0,o a"/,&&%" 9&-a& on January :5, 19;;, !r.. In$an&% ,/*ro3%" -%r o$$%r an" -% a2r%%" &o .%(( &-% (an" an" ,&. ,/*ro3%/%n&. &o -%r $or :,;:;.55 < 2n a *r,3a&% /%/oran"u/ a2r%%/%n& dated January =1, 1955, respondent on0,o ,n"%%" 'oun" -,/.%($ &o .%(( &o -,. 0orr%.*on"%n& E//a In$an&%, &-% *ro*%r&y $or &-% .u/ o$ 2,:;7.;2, +,&r%.*on"%n& E//a In$an&% .&,(( a..u/,n2 &-% %1,.&,n2 /or&2a2% "%'& ,n $a3or o$ R%*u'(,0 Sa3,n2. Ban) ,n &-% a/oun& o$ 1,177.4<. 1mma 2nfante lives .ust (ehind the houses of Poncio and "osario *ar(onell. 8n 9e(ruary 2, 1955, respondent Jose on0,o %1%0u&%" &-% $or/a( "%%" o$ .a(% ,n $a3or o$ r%.*on"%n& !r.. In$an&% ,n &-% &o&a( .u/ o$ :,;;4.55 and on the same date, the In$an&% *a," R%*u'(,0 Sa3,n2. Ban) &-% /or&2a2% ,n"%'&%"n%.. o$ 1,;55.55. )he /or&2a2% on &-% (o& +a. %3%n&ua((y ",.0-ar2%". In$or/%" &-a& &-% .a(% ,n $a3or o$ r%.*on"%n& E//a In$an&% -a" no& y%& '%%n r%2,.&%r%" , A&&y. Gar0,a *r%*ar%" an a"3%r.% 0(a,/ $or *%&,&,on%r, +-o .,2n%" an" .+or% &o an" r%2,.&%r%" &-% .a/% on February 8, 1955. )he "%%" o$ .a(% ,n $a3or o$ r%.*on"%n& !r.. In$an&% +a. r%2,.&%r%" on(y on February 12, 1955. As a conse'uence thereof, a Tran.$%r C%r&,$,0a&% o$ T,&(% +a. ,..u%" &o -%r 'u& +,&- &-% anno&a&,on o$ &-% a"3%r.% 0(a,/ o$ *%&,&,on%r Ro.ar,o Car'on%(( . "espondent 1mma In$an&% &oo) ,//%",a&% *o..%..,on o$ &-% (o& ,n3o(3%", 0o3%r%" &-% .a/% +,&- ;55 0u',0 /%&%r. o$ 2ar"%n .o,( an" 'u,(& &-%r%,n a +a(( an" 2a&%, spendin the sum of P1,5,,.,,. !he further contracted the services of an architect to (uild a house6 (ut the construction of the same started only in 1959 > years after the liti ation actually (e an and durin its pendency. "espondent 7rs. In$an&% .*%n& $or &-% -ou.% &-% &o&a( a/oun& o$ 11,929.55. 8n June 1, 1955, petitioner "osario Car'on%((, &-ru 0oun.%(, $,(%" a .%0on" a/%n"%" 0o/*(a,n& a2a,n.& *r,3a&% r%.*on"%n&., *ray,n2 &-a& .-% '% "%0(ar%" &-% (a+$u( o+n%r o$ &-% 6u%.&,on%" *ar0%( o$ (an"6 that the .u'.%6u%n& .a(% &o r%.*on"%n&. Ra/on R. In$an&% an" E//a L. In$an&% '% "%0(ar%" nu(( an" 3o,", and that Jose on0,o '% or"%r%" &o %1%0u&% &-% 0orr%.*on",n2 "%%" o$ 0on3%yan0% o$ .a," (an" ,n -%r $a3or an" $or "a/a2%. an" a&&orn%y=. $%%. "espondents first moved to dismiss the complaint on the round, amon others, that *%&,&,on%r=. 0(a,/ ,. un%n$or0%a'(% un"%r &-% S&a&u&% o$ Frau"., the alle ed sale in her favor not (ein evidenced (y a written document6 and when said motion was denied without pre.udice to passin on the 'uestion raised therein when the case would (e tried on the merits, respondents filed separate answers, reiteratin the rounds of their motion to dismiss. ;urin the trial, when petitioner started presentin evidence of the sale of the land in 'uestion to her (y respondent Poncio, part of which evidence was the a reement written in the /atanes dialect aforementioned, respondent 2nfantes o(.ected to the presentation (y petitioner of parole evidence to prove the alle ed sale (etween her and respondent Poncio. 2n its order of April 2?, 19??, the &r,a( 0our& .u.&a,n%" &-% o'>%0&,on an" ",./,..%" &-% 0o/*(a,n& on &-% 2roun" &-a& &-%

/%/oran"u/ *r%.%n&%" 'y *%&,&,on%r &o *ro3% .a," .a(% "o%. no& .a&,.$y &-% r%6u,r%/%n&. o$ &-% (a+ 9rom the a(ove order of dismissal, petitioner appealed to the !upreme *ourt %:.". +o. @$112=1& which ruled in a decision dated 7ay 12, 195A, &-a& &-% S&a&u&% o$ Frau"., '%,n2 a**(,0a'(% on(y &o %1%0u&ory 0on&ra0&., "o%. no& a**(y &o &-% a((%2%" .a(% '%&+%%n *%&,&,on%r an" r%.*on"%n& on0,o, +-,0- *%&,&,on%r 0(a,/%" &o -a3% '%%n *ar&,a((y *%r$or/%" , so that petitioner is entitled to esta(lish (y parole evidence <the truth of this alle ation, as well as the contract itself.< )he order appealed from was thus reversed, and the case remanded to the court a quo for further proceedin s After trial in the court a quo; a decision was, rendered on ;ecem(er 5, 19?2, "%0(ar,n2 &-% .%0on" .a(% 'y r%.*on"%n& Jo.% on0,o &o -,. 0o-r%.*on"%n&. Ra/on In$an&% an" E//a In$an&% o$ &-% (an" ,n 6u%.&,on nu(( an" 3o," an" or"%r,n2 r%.*on"%n& on0,o &o %1%0u&% &-% *ro*%r "%%" o$ 0on3%yan0% o$ .a," (an" ,n $a3or o$ *%&,&,on%r after compliance (y the latter of her covenants under her a reement with respondent Poncio Bence, this appeal (y certiorari. Article 15--, +ew *ivil *ode, which is decisive of this case, recitesC 2f the same thin should have (een sold to different vendees, the ownership shall (e transferred to the person who may have first taken possession thereof in good faith, if it should movab e property. !hould it (e immovab e property, the ownership shall (elon to the person ac'uirin it who in good faith first recorded it in the "e istry of Property. !hou d there be no inscription, the ownership shall pertain to the person who in good faith was first in the possession; and, in the a(sence thereof, to the person who presents the oldest title, provided there is ood faith %emphasis supplied&. 2t is %..%n&,a( &-a& &-% 'uy%r o$ r%a(&y /u.& a0& ,n 2oo" $a,&- ,n r%2,.&%r,n2 -,. "%%" o$ .a(% &o /%r,& &-% *ro&%0&,on o$ &-% .%0on" *ara2ra*- of said Article 15--. 4nli0e the first and third para raphs of said Article 15--, which accord preference to the one who $,r.& &a)%. *o..%..,on ,n 2oo" $a,&- o$ *%r.ona( or r%a( *ro*%r&y, the second para raph directs that ownership of immova(le property should (e reco ni#ed in favor of on% "who in good faith first recorded" -,. r,2-&. 4nder the first and third para raph, good faith /u.& 0-ara0&%r,8% &-% a0& o$ an&%r,or r%2,.&ra&,on 2f there is no inscription, what is decisive is prior possession in ood faith. 2f there is inscription, as in the case at (ar, prior re istration in ood faith is a pre$condition to superior title. Dhen *ar(onell (ou ht the lot from Poncio on January 27, 1955, she was the only (uyer thereof and the title of Poncio was still in his name solely encum(ered (y (an0 mort a e duly annotated thereon. *ar(onell was not aware > and she could not have (een aware > of any sale of 2nfante as there was no such sale to 2nfante then. Bence, *ar(onell5s prior purchase of the land was made in ood faith. Ber ood faith su(sisted and continued to e3ist when she recorded her adverse claim four %-& days prior to the re istration of 2nfantes5s deed of sale. *ar(onell5s ood faith did not cease after Poncio told her on January =1, 1955 of his second sale of the same lot to 2nfante. /ecause of that information, *ar(onell wanted an audience with 2nfante, which desire underscores *ar(onell5s

ood faith. Dith an aristocratic disdain unworthy of the ood (reedin of a ood *hristian and ood nei h(or, 2nfante snu((ed *ar(onell li0e a leper and refused to see her. !o Car'on%(( "," &-% n%1& '%.& &-,n2 &o *ro&%0& -%r r,2-& ? .-% r%2,.&%r%" -%r a"3%r.%" 0(a,/ on F%'ruary <, 19;; . Un"%r &-% 0,r0u/.&an0%., &-,. r%0or",n2 o$ -%r a"3%r.% 0(a,/ .-ou(" '% "%%/%" &o -a3% '%%n "on% ,n 2oo" $a,&- an" .-ou(" %/*-a.,8% In$an&%=. 'a" $a,&- +-%n .-% r%2,.&%r%" -%r "%%" o$ .a(% $our @4A "ay. (a&%r on F%'ruary 12, 19;;. Ba" $a,&- ar,.,n2 $ro/ *r%3,ou. )no+(%"2% 'y In$an&% o$ &-% *r,or .a(% &o Car'on%(( ,. .-o+n 'y &-% $o((o+,n2 $a0&., the vital si nificance and evidenciary effect of which the respondent *ourt of Appeals either overloo0ed of failed to appreciateC %1& 7rs. In$an&% r%$u.%" &o .%% Car'on%((, who wanted to see 2nfante after she was informed (y Poncio that he sold the lot to 2nfante (ut several days (efore 2nfante re istered her deed of sale. )his indicates that 2nfante 0new > from Poncio and from the (an0 > of the prior sale of the lot (y Poncio to *ar(onell. 8rdinarily, one will not refuse to see a nei h(or. 2nfante lives .ust (ehind the house of *ar(onell. Ber refusal to tal0 to *ar(onell could only mean that she did not want to listen to *ar(onell5s story that she %*ar(onell& had previously (ou ht the lot from Poncio. %2& Car'on%(( +a. a(r%a"y ,n *o..%..,on o$ &-% /or&2a2% *a..'oo) Enot Poncio5s savin deposit pass(oo0 > 13hi(it <1< > 2nfantesF an" on0,o=. 0o*y o$ &-% /or&2a2% 0on&ra0&, +-%n on0,o .o(" &-% (o& Car'on%(( +-o, a$&%r *ay,n2 &-% arr%ara2%. o$ on0,o, a..u/%" &-% 'a(an0% o$ -,. /or&2a2%" ,n"%'&%"n%.. &o &-% 'an), +-,0- ,n &-% nor/a( 0our.% o$ 'u.,n%.. /u.& -a3% n%0%..ar,(y ,n$or/%" In$an&% a'ou& &-% .a," a..u/*&,on 'y Car'on%(( o$ &-% /or&2a2% ,n"%'&%"n%.. o$ on0,o. /efore or upon payin in full the mort a e inde(tedness of Poncio to the /an0. 2nfante naturally must have demanded from Poncio the delivery to her of his mort a e pass(oo0 as well as Poncio5s mort a e contract so that the fact of full payment of his (an0 mort a e will (e entered therein6 and Poncio, as well as the (an0, must have inevita(ly informed her that said mort a e pass(oo0 could not (e iven to her (ecause it was already delivered to *ar(onell. 2f Poncio was still in possession of the mort a e pass(oo0 and his copy of the mort a e contract at the time he e3ecuted a deed of sale in favor of the 2nfantes and when the 2nfantes redeemed his mort a e inde(tedness from the (an0, Poncio would have surrendered his mort a e pass(oo0 and his copy of the mort a e contract to the 2nfantes, who could have presented the same as e3hi(its durin the trial, in much the same way that the 2nfantes were a(le to present as evidence 13hi(it <1< > 2nfantes, Poncio5s savin s deposit pass(oo0, of which Poncio necessarily remained in possession as the said deposit pass(oo0 was never involved in the contract of sale with assumption of mort a e. !aid savin s deposit pass(oo0 merely proves that Poncio had to withdraw P-7.2?, which amount was tided to the sum of P2,,.,, paid (y *ar(onell for Poncio5s amorti#ation arreara es in favor of the (an0 on January 27, 19556 (ecause *ar(onell on that day (rou ht with her only P2,,.,,, as Poncio told her that was the amount of his arreara es to the (an0. /ut the ne3t day *ar(onell refunded to Poncio the sum of P-7.2?. %=& )he fact that on0,o +a. no (on2%r ,n *o..%..,on o$ -,. /or&2a2% *a..'oo) an" &-a& &-% .a," /or&2a2% *a..'oo) +a. a(r%a"y ,n *o..%..,on o$ Car'on%((, .-ou(" -a3% 0o/*%((%" In$an&% &o ,n6u,r% $ro/ on0,o +-y -% +a. no (on2%r ,n *o..%..,on o$ &-% /or&2a2% *a..'oo) an" $ro/ Car'on%(( +-y .-% +a. ,n *o..%..,on o$ &-% .a/% %Pa la o, et. al vs. Jara et al 22 !*"A 12-7, 1252$125=&. )he only plausi(le and lo ical reason why 2nfante did not (other anymore to ma0e such in.ury , w (ecause in the ordinary course of (usiness the (an0 must have told her that Poncio already sold the lot to *ar(onell who there(y assumed the mort a e inde(tedness of Poncio and to whom Poncio delivered his mort a e pass(oo0. Bopin to ive a sem(lance of truth to her pretended ood faith, 2nfante snu((ed *ar(onell5s re'uest to tal0 to her a(out the prior

sale to her ( Poncio of the lot. As aforestated, this is not the attitude e3pected of a ood nei h(or im(ued with *hristian charity and ood will as well as a clear conscience. %-& Car'on%(( r%2,.&%r%" on F%'ruary <, 19;; -%r a"3%r.% 0(a,/, +-,0- +a. a00or",n2(y anno&a&%" on on0,o=. &,&(%, $our B4C "ay. '%$or% In$an&% r%2,.&%r%" on F%'ruary 12, 19;; -%r "%%" o$ .a(% %1%0u&%" on F%'ruary 2, 19;;. Bere she was a ain on notice of the prior sale to *ar(onell. !uch re istration of adverse claim is valid and effective %5& 2n his answer to the complaint filed (y Poncio, as defendant in the *ourt of 9irst 2nstance, -% a((%2%" &-a& 'o&- !r.. In$an&% an" !r.. Car'on%(( o$$%r%" &o 'uy &-% (o& a& 1;.55 *%r .6uar% /%&%r, +-,0- o$$%r. -% r%>%0&%" a. -% '%(,%3%" &-a& -,. (o& ,. +or&- a& (%a.& 25.55 *%r .6uar% /%&%r. 2t is therefore lo ical to presume that 2nfante was told (y Poncio and conse'uently 0new of the offer of *ar(onell which fact li0ewise should have put her on her uard and should have compelled her to in'uire from Poncio whether or not he had already sold the property to *ar(onell. DB1"198"1, )B1 ;1*2!28+ 89 )B1 !P1*2A@ ;2V2!28+ 89 92V1 89 )B1 *84") 89 APP1A@! 89 8*)8/1" =,, 19?A 2! B1"1/G "1V1"!1;6 P1)2)28+1" "8!A"28 *A"/8+1@@ 2! B1"1/G ;1*@A"1; )8 BAV1 )B1 !4P1"28" "2:B) )8 )B1 @A+; 2+ H41!)28+ A+; 2! B1"1/G ;2"1*)1; )8 "127/4"!1 )8 P"2VA)1 "1!P8+;1+)! 2+9A+)1! )B1 !47 89 8+1 )B84!A+; 92V1 B4+;"1; P1!8! %P1,5,,.,,& D2)B2+ )B"11 %=& 78+)B! 9"87 )B1 92+A@2)G 89 )B2! ;1*2!28+6 A+; )B1 "1:2!)1" 89 ;11;! 89 "2IA@ 2! B1"1/G ;2"1*)1; )8 *A+*1@ )"A+!91" *1")292*A)1 89 )2)@1 +8. =7A-2 2!!41; 2+ 9AV8" 89 P"2VA)1 "1!P8+;1+)! 2+9A+)1! *8V1"2+: )B1 ;2!P4)1; @8), DB2*B *A+*1@@1; )"A+!91" *1")292*A)1 89 )2)@1 +8. 5,-, 2+ )B1 +A71 89 J8!1 P8+*28, A+; )8 2!!41 A +1D )"A+!91" *1")292*A)1 89 )2)@1 2+ 9AV8" 89 P1)2)28+1" "8!A"28 *A"/8+1@@ 4P8+ P"1!1+)A)28+ 89 P"889 89 PAG71+) /G B1" )8 )B1 2+9A+)1! 89 )B1 A98"1!A2; A784+) 89 8+1 )B84!A+; 92V1 B4+;"1; P1!8! %P1,5,,.,,&. P"2VA)1 "1!P8+;1+)! 2+9A+)1! 7AG "178V1 )B12" A98"171+)28+1; 4!194@ 27P"8V171+)! 9"87 )B1 @8) D2)B2+ )B"11 %=& 78+)B! 9"87 )B1 92+A@2)G 89 )B2! ;1*2!28+, 4+@1!! )B1 P1)2)28+1" "8!A"28 *A"/8+1@@ 1@1*)! )8 A*H42"1 )B1 !A71 A+; PAG! )B1 2+9A+)1! )B1 A784+) 89 )B2")11+ )B84!A+; 984" B4+;"1; )D1+)G$+2+1 P1!8! %P1=,-29.,,& D2)B2+ )B"11 %=& 78+)B! 9"87 )B1 92+A@2)G 89 )B2! ;1*2!28+. !B84@; P1)2)28+1" *A"/8+1@@ 9A2@ )8 PAG )B1 !A2; A784+) D2)B2+ )B1 A98"1!)A)1; P1"28; 89 )B"11 %=& 78+)B! 9"87 )B1 92+A@2)G 89 )B2! ;1*2!28+, )B1 P1"28; 89 )B"11 %=& 78+)B! D2)B2+ DB2*B )B1 "1!P8+;1+)! 2+9A+)1! 7AG "178V1 )B12" A98"171+)28+1; 4!194@ 27P"8V171+)! !BA@@ *8771+*1 9"87 )B1 1JP2"A)28+ 89 )B1 )B"11 %=& 78+)B! :2V1+ P1)2)28+1" *A"/8+1@@ )8 PAG 98" )B1 !A2; 4!194@ 27P"8V171+)!. D2)B *8!)! A:A2+!) P"2VA)1 "1!P8+;1+)!.

7AGU AN TRA7ING CO! AND, petitioner, vs. RUSTICO !ACA!, respondent. 7IEON, J.: 2n the year 1955, !ammy 7aron and his seven (rothers and sisters were pro$indiviso owners of a parcel of unre istered land located in (arrio Parayao, 7unicipality of /inmaley, Pan asinan. Dhile their application for re istration of said land under Act +o. -9? was pendin , they e3ecuted, on June 19 and !eptem(er 21, 1955, two deeds of sale conveyin the property to appellee, who thereafter too0 possession thereof and proceeded to introduce su(stantial improvements therein. 8ne month later, that is, on 8cto(er 1-, 1955, 8ri inal *ertificate of )itle +o. ?9-2 coverin the land was issued in the name of the 7aron5s, free from all liens and encum(rances. 8n Au ust -, 195?, (y virtue of a final .ud ment rendered in *ivil *ase +o. -2215 of the 7unicipal *ourt of 7anila a ainst !ammy 7aron in favor of the 7anila )radin and !upply *ompany, levy was made upon whatever interest he had in the aforementioned property, and thereafter said interest was sold at pu(lic auction to the .ud ment creditor. )he correspondin notice of levy, certificate of sale and the !heriff5s certificate of final sale in favor of the 7anila )radin and !upply *o. > (ecause no(ody e3ercised the ri ht of redemptions > were duly re istered. 8n 7arch 1, 195A, the latter sold all its ri hts and title to the property to appellant. )he 'uestion (efore 4s now isC Dho has the (etter ri ht as (etween appellant ;a upan )radin *ompany, on the one hand, and appellee "ustico 7acam, on the other, to the one$ei hth share of !ammy 7aron in the property mentioned heretoforeK 2f the property covered (y the conflictin sales were unregistered land, 7acam would undou(tedly have the (etter ri ht in view of the fact that his claim is (ased on a prior sale coupled with pu(lic, e3clusive and continuous possession thereof as owner. 8n the other hand, were the land involved in the conflictin transactions duly re istered land, De would (e inclined to hold that appellant has the (etter ri ht (ecause, as De have consistently held, in case of conveyance of re istered real estate, the re istration of the deed of sale is the operative act that ives validity to the transfer. )his would (e fatal to appellee5s claim, the deeds of sale e3ecuted in his favor (y the 7aron5s not havin (een re istered, while the levy in e3ecution and the provisional certificate of sale as well as the final deed of sale in favor of appellant were re istered. *onse'uently, this re istered conveyance must prevail althou h posterior to the one e3ecuted in favor of appellee, and appellant must (e deemed to have ac'uired such ri ht, title and interest as appeared on the certificate of title issued in favor of !ammy 7aron, su(.ect to no lien, encum(rance or (urden not noted thereon. %Anderson L *o. vs. :arcia, ?- Phil. 5,?6 "eynes, et al. vs. /arrera, et al., ?A Phil. ?5?6 /anco +acional, etc. vs. *amus, 7, Phil. 2A9& )he present case, however, does not fall within either, situation. Bere the sale in favor of appellee was e3ecutedbefore the land su(.ect$matter thereof was re istered, while the conflictin sale in favor of appellant was e3ecutedafter the same property had (een re istered. De cannot, therefore, decide the case in the li ht of whatever ad.udicated cases there are coverin the two situations mentioned in the precedin para raph. 2t is our considered view that what should determine the issue are the

provisions of the last para raph of !ection =5, "ule =9 of the "ules of *ourt, to the effect that upon the e3ecution and delivery of the final certificate of sale in favor of the purchaser of land sold in an e3ecution sale, such purchaser <shall (e su(stituted to and ac'uire all the ri ht, title, interest and claim of the .ud ment de(tor to the property as of the time of the levy.< +ow De as0C Dhat was the interest and claim of !ammy 7aron on the one$ei hth portion of the property inherited (y him and his co$heirs, at the time of the levyK )he answer must necessarily (e that he had none, (ecause for a considera(le time prior to the levy, his interest had already (een conveyed to appellee, <fully and retrieva(ly > as the *ourt of Appeals held. *onse'uently, su(se'uent levy made on the property for the purpose of satisfyin the .ud ment rendered a ainst !ammy 7aron in favor of the 7anila )radin *ompany was void and of no effect %/uson vs. @icuaco, 1= Phil. =57$=5A6 @andi vs. 4.!. *ommercial *ompany, :.". +o. @$=597, July =1, 1951&. +eedless to say, the unre istered sale and the conse'uent conveyance of title and ownership in favor of appellee could not have (een cancelled and rendered of no effect upon the su(se'uent issuance of the )orrens title over the entire parcel of land. De cannot, therefore, (ut a ree with the followin statement contained in the appealed decisionC ... . !eparate and apart from this however, we (elieve that in the inevita(le conflict (etween a ri ht of ownership already fi3ed and esta(lished under the *ivil @aw andMor the !panish 7ort a e @aw > which cannot (e affected (y any su(se'uent levy or attachment or e3ecution > and a new law or system which would ma0e possi(le the overthrowin of such ownership on admittedly artificial and technical rounds, the former must (e upheld and applied.
1"wph#1.$%t

/ut to the a(ove considerations must (e added the important circumstance that, as already stated (efore, upon the e3ecution of the deed of sale in his favor (y !ammy 7aron, appellee too0 possession of the land conveyed as owner thereof, and introduced considera(le improvements thereon. )o deprive him now of the same (y sheer force of technicality would (e a ainst (oth .ustice and e'uity. 2+ V21D 89 A@@ )B1 98"1:82+:, the decision appealed from is affirmed, with costs.

FELI E 7AFI7 an" ANTONIA G. 7AFI7, petitioners, vs. EULOGIO BAN7IN @.u'.&,&u&%" 'y -,. (%2a( -%,r., na/%(yG JUANA SILFERIO, JOSE, GABRIEL, ANICETA, FIRGINIA an" FELIH, a(( .urna/%" Ban",nAI GREGORIO BAN7IN, RAD!UN7A BAN7IN, FALENTIN BRIONES, SOFIO BRIONES an" AGA ITA RA!OS. respondents.

No. L-49712 A*r,( <, 19<7 !AGNO 7E LA CRUE, petitioner, vs. HONORABLE COURT OF A EALSI EULOGIO BAN7IN @.u'.&,&u&%" 'y -,. (%2a( -%,r., na/%(yG JUANA, SILFERIO, JOSE, GABRIEL, ANICETA, FIRGINIA an" FELIH, a(( .urna/%" Ban",nAI GREGORIO BAN7IN, RAD!UN7A BAN7IN, SOFIO BRIONES an" AGA ITA RA!OSI respondents.

No. L-49716 A*r,( <, 19<7 JUANITA !ARTIN F7A. 7E LUCENA !AHI!INA !ARTIN F7A. 7E COS!E, FICTORIA !ARTIN F7A. 7E O!ANBAC, NE!ESIO A. !ARTIN, LEONORA 7E LA CRUE an" AJUILINA 7E LA CRUE, *%&,&,on%r., 3.. EULOGIO BAN7IN @.u'.&,&u&%" 'y -,. (%2a( -%,r., na/%(yG JUANA, SILFERIO, JOSE, GABRIEL, ANICETA, FIRGINIA an" FELIH, a(( .urna/%" Ban",nAI, FALENTIN BRIONES, AGA ITA RA!OS an" COURT OF A EALS, r%.*on"%n&.. No. L-496<7 A*r,( <,19<7 JOSE RA!IREE an" HEIRS OF A!BROCIA . F7A. 7E SOTERO RA!IREE, *%&,&,on%r., 3.. COURT OF A EALS an" EULOGIO BAN7IN @.u'.&,&u&%" 'y -,. (%2a( -%,r., na/%(yG JUANA, SILFERIO, JOSE, GABRIEL, ANICETA, FIRGINIA an" FELIH, a(( .urna/%" BAN7INAI GREGORIO BAN7IN, RAD!UN7A BAN7IN, FALENTIN BRIONES, SOFIO BRIONES an" AGA ITA RA!OS, r%.*on"%n&.. Benito P. Fable for etitioners in !.". #o. $%&'(22. Pedro ". de la )ru* for etitioner in !.". #o. $%&9+12. ,a-id ". .d-incula for etitioners in !.". #o. $%&9+1/. .ntonio 0. "eyes for etitioners in !. ". #o. $%&9/'+. 1nri2ue ) 3illanue-a for res ondents.

DA , J.: T-%.% *%&,&,on., +-,0- +%r% 0on.o(,"a&%" 'y r%.o(u&,on o$ &-,. Cour& "a&%" F%'ruary 25, 19<5, .&%//%" $ro/ a 0o/*(a,n& $,(%" 'y &-% -%r%,n r%.*on"%n&. +,&- &-% Cour& o$ F,r.& In.&an0% o$ R,8a( Bran0- FII, a.ay C,&y, on Jun% 14, 196:, $or &-% r%0o3%ry an" *ar&,&,on o$ *ro*%r&y. T-% 0o/*(a,n& +a. a/%n"%" &+,0% &o r%$(%0& a"",&,ona( *%r&,n%n& an" /a&%r,a( $a0&., .u0- a. &ran.$%r., *ar&,&,on., .u'",3,.,on. an" r%2,.&ra&,on o$ *or&,on. o$ &-% *ro*%r&,%. ,n3o(3%", an" &o 'r,n2 ,n o&-%r ,n",.*%n.a'(% *ar&,%. &o &-% 0a.%. On A*r,( 12, 197;, a "%0,.,on +a. r%n"%r%" 'y &-% &r,a( 0our&, ,n $a3or o$ &-% *(a,n&,$$., "%0(ar,n2, -o+%3%r, &-a& 0%r&a,n *ro*%r&,%. 0ou(" no (on2%r '% r%0on3%y%" &o *(a,n&,$$. .,n0% &-%y -a" '%%n &ran.$%rr%" &o *ur0-a.%r. +-o 'ou2-& &-%/ ,n 2oo" $a,&- $or 3a(u%. No& .a&,.$,%" +,&- &-% "%0,.,on, 'o&- *(a,n&,$$. an" "%$%n"an&. a**%a(%" &o &-% Cour& o$ A**%a(.. T-% *(a,n&,$$.= a**%a( +a. "o0)%&%" a. CA-G.R. No. ;<647-R, +-,(% &-a& o$ "%$%n"an&. a. CAG.R. No. 65;11-R. . Bo&- a**%a(. +%r% 0on.o(,"a&%", an" a "%0,.,on +a. r%n"%r%" 'y &-% Cour& o$ A**%a(. on !ay 19, 197<, +-,0- /o",$,%" &-% "%0,.,on o$ &-% &r,a( 0our& ,n &-a& ,& nu((,$,%" &-% &ran.$%r. /a"% &o &-% "%$%n"an&. +-o +%r% "%0(ar%" 'y &-% &r,a( 0our& a. *ur0-a.%r. ,n 2oo" $a,&-.

Fro/ &-% "%0,.,on o$ &-% Cour& o$ A**%a(., an a**%a( +a. &a)%n 'y &-% *ar&,%. a"3%r.%(y a$$%0&%" &-%r%'y &o &-,. Cour&. E10%*& $or *%&,&,on%r. ,n G.R. No. L-49716 +-o .%%) r%.&ora&,on o$ &-% .&a&u. 6uo an&%, a(( o&-%r *%&,&,on%r. *ray &-a& &-% "%0,.,on o$ &-% &r,a( 0our& '% r%,n.&a&%". T-% $a0&. an&%0%"%n& o$ &-,. *%&,&,on, a. /ay '% 2a&-%r%" $ro/ &-% "%0,.,on, ar% a. $o((o+.G 7ur,n2 &-%,r (,$%&,/%, &-% .*ou.%. Juan Ra/o., +-o ",%" on !ar0- ;, 1919, an" For&una&% Ca(,'o, +-o ",%" '%$or% 1919, +%r% &-% o+n%r. o$ &+o *ar0%(. o$ (an" .,&ua&%" ,n La. ,na., R,8a(G 1A A *ar0%( o$ (an" .,&ua&%" ,n Barr,o Ta(on, +,&- an ar%a o$ :9,<<7 .6uar% /%&%r., un"%r Ta1 7%0(ara&,on No. 9614 @Ta(on *ro*%r&y $or .-or&AI an" 2A A *ar0%( o$ (an" .,&ua&%" ,n Barr,o Laon2, +,&- an ar%a o$ 1;,99: .6uar% /%&%r., un"%r Ta1 7%0(ara&,on No. 455;, a(&-ou2- &-% a0&ua( ar%a +-%n .ur3%y%" +a. 22,2<; .6uar% /%&%r. @Laon2 *ro*%r&y $or .-or&A. Bo&- .*ou.%. ",%" ,n&%.&a&%, (%a3,n2 a. -%,r. &+o (%2,&,/a&% 0-,("r%n, Can","a an" F,0&or,an. Ra/o., an" 2ran"-"au2-&%r, A2a*,&a Ra/o., "au2-&%r o$ &-%,r "%0%a.%" .ora Ana.&a0,o. U*on &-% "%a&- o$ &-% .a," .*ou.%., &-%,r "au2-&%r, Can","a Ra/o., a..u/%" a"/,n,.&ra&,on o$ &-% *ro*%r&,%. un&,( -%r "%a&- on F%'ruary 16, 19;;. F,0&or,an. Ra/o. ",%" on 7%0%/'%r 12,19:1. Bo&- Can","a an" F,0&or,ana Ra/o. ",%" ,n&%.&a&%. Can","a Ra/o. +a. .ur3,3%" 'y &-% $o((o+,n2 -%,r.G 1A F,0&or,a !ar&,n-O/an'a0, 2A An&on,o !ar&,n, :A Juan,&a !ar&,n F"a. "% Lu0%na, 4A !a1,/,na !ar&,n F"a. "% Co./%, ;A Ray/un"o !ar&,n, 6A A6u,(,na "% (a Cru8, an" 7A L%onora "% (a Cru8. F,0&or,ana=. -%,r. ar% -%r 0-,("r%n $ro/ -%r &+o /arr,a2%., na/%(yG 1A Eu(o2,o Ban",n, 2A Gr%2or,o Ban",n, :A Ray/un"a Ban",n, 4A Fa(%n&,n Br,on%., an" ;A So$,o Br,on%.. T-% r%0or" .-o+. &-a& .o/%&,/% ,n 194:, Can","a Ra/o. *r%3a,(%" u*on -%r n,%0%, A2a*,&a Ra/o., an" -%r n%*-%+, Eu(o2,o Ban",n, &o .%(( a *or&,on o$ &-% Ta(on *ro*%r&y &o &-% .*ou.%. Ru$,no 5. !,ran"a an" Na&,3,"a" Gu,n&o. T-,. *or&,on +a. ",3,"%" ,n&o &-r%% (o&.G Parcel 1, 0on&a,n,n2 an ar%a o$ 24,:6: .6uar% /%&%r., "%0(ar%" un"%r Ta1 7%0(ara&,on No. 2996 @194<A. T-% .*ou.%. Ru$,no !,ran"a an" Na&,3,"a" Gu,n&o .u'.%6u%n&(y .o(" &-% .a," (o& &o Nar0,.o F%(a.6u%8 an" A(',no !,ran"a. T-%.% &+o (a&%r .o(" &-% .a/% *ro*%r&y &o F%(a.6u%8 R%a(&y Co/*any, In0., +-,0- r%2,.&%r%" &-% *ro*%r&y an" o'&a,n%" OCT No. 17;6 @(a&%r 0an0%((%" an" r%*(a0%" 'y TCT No. 16;::;AI Parcel 2, 0on&a,n,n2 an ar%a o$ 7;2 .6uar% /%&%r., "%0(ar%" un"%r Ta1 7%0(ara&,on No. ::;< @1949AI an" Parcel (, 0on&a,n,n2 an ar%a o$ ;16 .6uar% /%&%r. un"%r Ta1 7%0(ara&,on No. ::;9 @1949A. ar0%(. 2 an" : +%r% .u'.%6u%n&(y .o(" 'y Ru$,no !,ran"a an" Na&,3,"a" Gu,n&o &o Jo.% Ra/,r%8 an" So&%ro Ra/,r%8 @.ur3,3%" 'y A/'ro0,a F"a. "% !ar&,nA, r%.*%0&,3%(y, +-o r%2,.&%r%" &-%.% *ro*%r&,%. an" o'&a,n%" OCT No.. 2527 an" 2529 ,n &-%,r r%.*%0&,3% na/%.. T-% r%/a,n,n2 *or&,on o$ &-% Ta(on *ro*%r&y +a. %1&ra>u",0,a((y *ar&,&,on%" on S%*&%/'%r 17, 19;; a/on2 &-% -%,r. o$ Can","a Ra/o., na/%(yG Juan,&a !ar&,n, F,0&or,a !ar&,n, !a1,/,na !. F"a. "% Co./%, An&on,o !ar&,n an" Ray/un"o !ar&,n. In 19;9, &-,. *ro*%r&y +a. .u'",3,"%" @Su'",3,.,on (an SU-17:299A ,n&o .%3%n (o&. an" a">u",0a&%" a. $o((o+.G 1A To &-% -%,r. o$ Ray/un"o !ar&,n, na/%(y, Juan, An&on,o, Ro"r,2o, Nor/a, B%rnar"., Ru$,na an" N,%3%., a(( .urna/%" !ar&,n, an" Tr,n,"a" Buna2 F"a. "% !ar&,n ? Lo& 1, 0on&a,n,n2 an ar%a o$ 774 .6uar% /%&%r., "%0(ar%" un"%r Ta1 7%0(ara&,on No. ;;<< @1965A. T-,. (o& +a. .u'.%6u%n&(y .o(" &o Con.o(a0,on "% (a Cru8 +-o +a. a'(% &o r%2,.&%r &-% *ro*%r&y ,n -%r na/% un"%r OCT No. 47:1 @(a&%r 0an0%((%" an" r%*(a0%" 'y TCT No.. 227475 an" 227471A.

2A To Juan,&a !ar&,n ? Lo& 2, 0on&a,n,n2 an ar%a o$ 774 .6uar% /%&%r., "%0(ar%" un"%r Ta1 7%0(ara&,on No. 4<:1, an" .u'.%6u%n&(y &,&(%" ,n -%r na/% un"%r OCT No. 15552, ,..u%" on 7%0%/'%r 1<, 197:. :A To L%onora "% (a Cru8, 2ran""au2-&%r o$ Can","a Ra/o. 'y -%r .on !%(,&on "% (a Cru8 'y -%r $,r.& -u.'an" ? Lo& :, 0on&a,n,n2 an ar%a o$ :46 .6uar% /%&%r., "%0(ar%" un"%r Ta1 7%0(ara&,on No. ;;26 @1965A an" .u'.%6u%n&(y r%2,.&%r%" un"%r OCT No. 6152, ,..u%" on January 29, 1967. 4A To An&on,o !ar&,n ? Lo& 4, 0on&a,n,n2 an ar%a o$ 774 .6uar% /%&%r., "%0(ar%" un"%r Ta1 7%0(ara&,on No. 4<::. T-% *ro*%r&y +a. .u'.%6u%n&(y .o(" 'y &-% -%,r. o$ An&on,o !ar&,n &o N%/%.,o !ar&,n. ;A To F,0&or,a !ar&,n ? Lo& ;, 0on&a,n,n2 an ar%a o$ 77: .6uar% /%&%r., "%0(ar%" un"%r Ta1 7%0(ara&,on No. ;;95. T-,. (o& +a. (a&%r r%2,.&%r%" 'y F,0&or,a, &o +-o/ OCT No. :756 +a. ,..u%" on Au2u.& 22, 196:. S-% .u'.%6u%n&(y .o(" a *or&,on o$ :55 .6uar% /%&%r. &o !a2no "% (a Cru8 on S%*&%/'%r 2;,196:, &o +-o/ +a. ,..u%" TCT No. 1164;5. 6A To !a1,/,na !ar&,n ? Lo& 6, 0on&a,n,n2 an ar%a o$ 77: .6uar% /%&%r., un"%r Ta1 7%0(ara&,on No. ;;91 @1965A. !a1,/,na +a. a'(% &o r%2,.&%r &-% (an" an" +a. ,..u%" OCT No. :757 on Au2u.& 22, 196:. S-% (a&%r .o(" a *or&,on o$ :55 .6uar% /%&%r. &o !a2no "% (a Cru8, &o +-o/ +a. ,..u%" TCT No. 1164;5. 7A To A6u,(,n% "% (a Cru8 ? Lo& 7, +,&- an ar%a o$ 42< .6uar% /%&%r., "%0(ar%" un"%r Ta1 7%0(ara&,on No. ;;92 @1965A. A6u,(,na ,. &-% 2ran""au2-&%r o$ Can","a Ra/o. 'y -%r .on !%(,&on "% (a Cru8 'y -%r $,r.& /arr,a2%. A6u,(,na r%2,.&%r%" &-% (an" ,n -%r na/% ,n 1967 an" +a. ,..u%" OCT No. 615:. T-% Laon2 *ro*%r&y +a. .o(" 'y Can","a Ra/o. an" -%r 0-,("r%n on 7%0%/'%r 19, 194: &o H%r/o2%n%. Lu0%na, -u.'an" o$ Juan,&a !ar&,n, on% o$ &-% "au2-&%r. o$ Can","a. On S%*&%/'%r 2:, 19;9, Juan,&a @&-%n +,"o+%"A .o(" &-% *ro*%r&y &o &-% .*ou.%. Gr%2or,o an" !ary F%n&uran8a $or 4:,2:6.55 o$ +-,0- 15,555 +a. *a," a. "o+n *ay/%n&, &-% 'a(an0% &o '% *a," u*on &-% 3%n"or o'&a,n,n2 Torr%n. &,&(% &o &-% (an". On January 21, 196;, &-% F%n&uran8a., ,n a "%%" o$ .a(% a(.o .,2n%" 'y Juan,&a !ar&,n, 0on3%y%" a *or&,on o$ &-% *ro*%r&y +,&- an ar%a o$ 1;,555 .6uar% /%&%r. &o &-% .*ou.%. F%(,*% an" An&on,a 7a3,", ,n (,6u,"a&,on o$ &-% (a&&%r=. ,n3%.&/%n& ,n &-% >o,n& r%a( %.&a&% 3%n&ur% +-,0- &-%y -a" %n&%r%" ,n&o +,&- &-% F%n&uran8a. ,n A*r,( 19;9. Juan,&a !ar&,n F"a. "% Lu0%na +a. a'(% &o r%2,.&%r &-% *ro*%r&y ,n -%r na/% an" +a. ,..u%" OCT No. <916 on Ju(y 1, 1971. T-% *or&,on .o(" &o &-% .*ou.%. F%(,*% an" An&on,a 7a3," ,. *r%.%n&(y 0o3%r%" 'y TCT No. :72592. Fro/ &-% $or%2o,n2 $a0&. a. %.&a'(,.-%" 'y &-% %3,"%n0%, &-% &r,a( 0our& -%(" &-a& &-% Ta(on an" Laon2 *ro*%r&,%. $or/%" *ar& o$ &-% %.&a&% o$ &-% .*ou.%. Juan Ra/o. an" For&una&% Ca(,'o, +-,0- a$&%r &-%,r "%a&- "%3o(3%" 'y r,2-& o$ .u00%..,on u*on &-%,r -%,r., na/%(y, Can","a Ra/o., F,0&or,an. Ra/o. an" A2a*,&a Ra/o., %a0- o$ +-o/ +a. %n&,&(%" &o on%&-,r" @1K:A *ro-,n",3,.o .-ar% o$ &-% *ro*%r&,%.. T-% %.&a&% o$ &-% "%0%a.%" .*ou.%. +a. n%3%r >u",0,a((y or %1&ra->u",0,a(y .%&&(%" a/on2 &-%,r -%,r., +-o, &-%r%$or%, r%/a,n%" *ro-,n",3,.o 0o-o+n%r. o$ &-% .a," *ro*%r&,%., an" u*on &-% "%a&- o$ F,0&or,an. an" Can","a, &-%,r r%.*%0&,3% .-ar%. ,n &urn *a..%" &o &-%,r -%,r.. A00or",n2(y, &-% &r,a( 0our& "%0(ar%" &-% *(a,n&,$$., A2a*,&a Ra/o., an" &-% -%,r. o$ F,0&or,an. Ra/o., %n&,&(%" &o &+o- &-,r". @2K:A *ro,n",3,.o .-ar% o$ &-% Ta(on an" Laon2 *ro*%r&,%., an" or"%r%" &-% "%$%n"an&. -%,r. o$ Can","a Ra/o. &o r%0on3%y &o *(a,n&,$$. &-%,r .-ar%. ,n &-o.% *ro*%r&,%.. Ho+%3%r, .u0r%0on3%yan0% +a. no (on2%r *o..,'(% +,&- r%.*%0& &o &-% *or&,on. +-,0-, ,n &-% /%an&,/%,

-a" '%%n .o(" an" ",.*o.%" o$ &o &-,r" *ar&,%. +-o +%r% *ur0-a.%r. ,n 2oo" $a,&- an" $or 3a(u%. T-% $o((o+,n2 *ar&,%. +%r% -%(" &o '% *ur0-a.%r. ,n 2oo" $a,&-. 1A "%$%n"an&. Ru$,no !,ran"a, Nar0,.o F%(a.6u%8, A(',na !,ran"a an" F%(a.6u%8 R%a(&y Co., +,&- r%.*%0& &o 24,6:6 .6uar% /%&%r. @ ar0%( 1A o$ &-% Ta(on *ro*%r&y .o(" 'y Can","a Ra/o., Eu(o2,o Ban",n an" A2a*,&a Ra/o. ,n 194:I 2A "%$%n"an&. Jo.% Ra/,r%8 an" A/'ro0,a F"a. "% Ra/,r%8 @+,"o+ o$ So&%ro Ra/,r%8A, +,&- r%.*%0& &o 7;2 .6uar% /%&%r. @ ar0%( 2A an" ;16 .6uar% /%&%r. @ ar0%( :A, r%.*%0&,3%(y, o$ &-% Ta(on *ro*%r&y, :A "%$%n"an& Con.o(a0,on "% (a Cru8, +,&- r%.*%0& &o 774 .6uar% /%&%r. @Lo& 1 o$ Su'",3,.,on (an SU-17:299AI 4A "%$%n"an& N%/%.,o !ar&,n, +,&r%.*%0& &o 774 .6uar% /%&%r. @Lo& 2 o$ Su'",3,.,on (anAI ;A "%$%n"an& !a2no "% (a Cru8, +,&r%.*%0& &o :55 .6uar% /%&%r. .o(" 'y F,0&or,a !ar&,n an" :55 .6uar% /%&%r. .o(" 'y !a1,/,na !ar&,n @*or&,on. o$ Lo&. ; an" 6 o$ Su'",3,.,on (anAI 6A "%$%n"an& .*ou.%. F%(,*% an" An&on,a 7a3,", +,&- r%.*%0& &o 1;,555 .6uar% /%&%r. o$ &-% Laon2 *ro*%r&y. S,n0% &-% $or%2o,n2 *ro*%r&,%. 0ou(" no& '% r%0on3%y%" &o &-% *(a,n&,$$., &-% "%$%n"an&. -%,r. +-o .o(" &-%/ +%r% or"%r%" &o *ay &-% *(a,n&,$$. &+o-&-,r". @2K:A o$ &-% *r%.%n& 3a(u% o$ .u0*ro*%r&,%.. A. .&a&%" -%r%&o$or%, &-% &r,a( 0our&=. "%0,.,on +a. u*-%(" 'y &-% r%.*on"%n& Cour& o$ A**%a(., %10%*& +,&- r%.*%0& &o &-% $,n",n2 &-a& &-,r" *ar&,%. +-o 'ou2-& *or&,on. o$ &-% *ro*%r&,%. $ro/ &-% "%$%n"an&. -%,r. +%r% *ur0-a.%r. ,n 2oo" $a,&- T-,. $,n",n2 +a. r%3%r.%" 'y &-% r%.*on"%n& a**%((a&% 0our&. In $,n%, &-% a**%((a&% 0our&G aA nu((,$,%" &-% .a(% o$ &-% Laon2 *ro*%r&y 'y Can","a Ra/o. F"a. "% !ar&,n an" -%r 0-,("r%n ,n 194: ,n $a3or o$ H%r/o2%n%. Lu0%na, &-% -u.'an" o$ Juan,&a !ar&,n, on% o$ &-% "au2-&%r. o$ Can","a, a. +%n a. an .u'.%6u%n& .a(%., &ran.$%r. an" 0on3%yan0%. o$ .a," *ro*%r&y, ,n.o$ar a. &-%y a$$%0&%" &-% &+o-&-,r". @2K:A *ro-,n",3,.o .-ar% o$ A2a*,&a Ra/o. an" &-% -%,r. o$ F,0&or,an. Ra/o.I 'A nu((,$,%" &-% .a(% o$ *or&,on. o$ &-% Ta(on *ro*%r&y 'y Can","a Ra/o., Eu(o2,o Ban",n an" A2a*,&a Ra/o. ,n 194: ,n $a3or o$ &-% .*ou.%. Ru$,no !,ran"a an" Na&,3,"a" Gu,n&o, an" a(( &-% .u'.%6u%n& &ran.$%r. o$ .a," *ro*%r&,%., ,n.o$ar a. &-% $our-$,$&%%n&- @4K1;A .-ar% o$ Gr%2or,o Ban",n, Ray/un"o Ban",n, So$,o Br,on%. an" Fa(%n&,n Br,on%. +%r% a$$%0&%"I an" 0A ,n3a(, "a&%" &-% "%%" o$ %1&ra>u",0,a( *ar&,&,on a/on2 &-% -%,r. o$ Can","a Ra/o. o3%r &-% r%/a,n,n2 *or&,on o$ &-% Ta(on *ro*%r&y ,n 19;; an" &-% .u'",3,.,on &-%r%o$ ,n&o ,n",3,"ua( (o&. a/on2 .a," -%,r., a. +%(( a. a(( .u'.%6u%n& &ran.$%r. an" 0on3%yan0%. o$ .o/% o$ .a," (o&., or *or&,on. &-%r%o$, &o &-,r" *ar&,%., ,n.o$ar a. &-%y a$$%0&%" &-% &+o-&-,r" @2K:A *ro,n",3,.o .-ar% *%r&a,n,n2 &o A2a*,&a Ra/o. an" &-% -%,r. o$ F,0&or,an. Ra/o.. Fro/ &-% a'o3% "%0,.,on o$ &-% Cour& o$ A**%a(., &-% *%&,&,on%r. -a3% 0o/% &o u. on .%*ara&% *%&,&,on. $or r%3,%+ 'y 0%r&,orar,. !.". #o. $%&9+1/.G T-% *%&,&,on%r. ar% &-% -%,r. o$ Can","a Ra/o., (%" 'y Juan,&a !ar&,n F"a. "% Lu0%na an" >o,n%" ,n 'y -%r 'ro&-%r. an" .,.&%r. +-o ar% &-% 0-,("r%n o$ Can","a 'y -%r $,r.& an" .%0on" /arr,a2%.. r,/ar,(y, *%&,&,on%r. a((%2%" &-a& &-% Cour& o$ A**%a(. %rr%" ,n no& "%0(ar,n2 &-a& *r,3a&% r%.*on"%n&.= 0(a,/ ,$ any, ,. 'arr%" 'y *r%.0r,*&,onI an" ,n annu((,n2 an" or"%r,n2 &-% 0an0%((a&,on o$ Or,2,na( C%r&,$,0a&% o$ T,&(% No. <916 ,..u%" ,n &-% na/% o$ Juan,&a !ar&,n *ur.uan& &o a "%0,.,on 'y &-% (an" r%2,.&ra&,on 0our&, a$$,r/%" 'y &-% Cour& o$ A**%a(. ,n CA G.R. No. :;191-R, +-,0- -a" a(r%a"y '%0o/% $,na( an" %1%0u&ory. %&,&,on%r. 0(a,/ ,n &-%,r 'r,%$, a**ar%n&(y r%$%rr,n2 &o &-% Laon2 *ro*%r&y on(y, &-a& Juan,&a !ar&,n, +,"o+ o$ H%r/o2%n%. Lu0%na an" "au2-&%r o$ Can","a Ra/o., -a" '%%n ,n *o..%..,on o$ &-% *ro*%r&y .,n0% 194: &o &-% %10(u.,on o$ *r,3a&% r%.*on"%n&.. T-% &r,a(

0our&, -o+%3%r, $oun" &-a& Can","a Ra/o., un&,( -%r "%a&- on F%'ruary 1;, 19;;, a"/,n,.&%r%" &-% Laon2 *ro*%r&y, an" &-a& *(a,n&,$$.- a**%((an&. +%r% 2,3%n &-%,r .-ar%. o$ &-% $ru,&. &-%r%o$, &-ou2- ,rr%2u(ar an" a& &,/%. (,&&(%, "%*%n",n2 on &-% a/oun& o$ &-% -ar3%.&. Un"%r Ar&,0(% 494 o$ &-% n%+ C,3,( Co"% @Ar&,0(% 455 o$ &-% o(" C,3,( Co"%A, *r%.0r,*&,on 2%n%ra((y "o%. no& run ,n $a3or o$ a 0o--%,r or 0o-o+n%r a. (on2 a., -% %1*r%..(y or ,/*(,%"(y r%0o2n,8%. &-% 0o-o+n%r.-,*. L-,(% an ,/*(,%" or 0on.&ru0&,3% &ru.& *r%.0r,'%. ,n &%n y%ar., &-% ru(% "o%. no& a**(y +-%r% a $,"u0,ary r%(a&,on %1,.&. an" &-% &ru.&%% r%0o2n,8%. &-% &ru.&. 1 In &-% 0a.% a& 'ar, &-%r% ,. no .-o+,n2 &-a& &-% r,2-&. o$ &-% *(a,n&,$$. a. 0o-o+n%r. +%r% r%*u",a&%" 'y Can","a Ra/o. ,n -%r (,$%&,/%I ,n $a0&, &-% %3,"%n0% a. $oun" 'y &-% &r,a( 0our& .-o+ &-% 0on&rary. T-% 0our& a 2uo "," no& .u.&a,n &-% "%$%n.% o$ (a0-%. an" *r%.0r,*&,on *u& u* 'y &-% "%$%n"an&. @-%r%,n *%&,&,on%r.A .,n0% ,& +a. no& .-o+n &-a& &-% *(a,n&,$$. +%r% 2u,(&y o$ n%2(,2%n0% or .(%*& on &-%,r r,2-&.. T-%y .%n& a (%&&%r o$ "%/an" &o &-% -%,r. o$ Can","a Ra/o. on A*r,( 2:, 196:, an" $,(%" &-%,r 0o/*(a,n& a2a,n.& &-%/ on Jun% 14, 196:, or +,&-,n a *%r,o" o$ a**ro1,/a&%(y %,2-& @<A y%ar. $ro/ Can","a=. "%a&-. In .u.&a,n,n2 &-% $,n",n2. o$ &-% &r,a( 0our&, &-% Cour& o$ A**%a(. "," no& 0o//,& any r%3%r.,'(% %rror. %&,&,on%r. $ur&-%r ,n3o)% &-% "o0&r,n% o$ r%. >u",0a&a ,n &-a& &-% "%0r%% o$ r%2,.&ra&,on o$ &-% *ro*%r&y ,n &-% na/% o$ Juan,&a !ar&,n a. o+n%r 'y &-% (an" r%2,.&ra&,on 0our& +a. a$$,r/%" 'y &-% Cour& o$ A**%a(. ,n ,&. "%0,.,on "a&%" Ju(y 16, 1969 ,n CA G.R. No. :;191-R, +-,0- -a" a(r%a"y '%0o/% $,na( an" %1%0u&ory. Bo&- &-% r%.*on"%n& Cour& o$ A**%a(. an" &-% &r,a( 0our& 0orr%0&(y r%>%0&%" &-% *%&,&,on%r.= 0on&%n&,on. T-%r% 0an '% no r%. >u",0a&a .,n0% *r,3a&% r%.*on"%n&. +%r% no& *ar&,%. &o &-% a'o3% 0a.%. N%,&-%r 0an ,& '% 0(a,/%" &-a& &-% "%0r%% o$ r%2,.&ra&,on 3%.&%" o+n%r.-,* ,n Juan,&a !ar&,n. T-% a**%((a&% 0our&, 0,&,n2 >ur,.*ru"%n0% %.&a'(,.-%" 'y &-,. Cour&, -%(" &-a& &-% *ur*o.% o$ &-% Lan" R%2,.&ra&,on A0& ,. no& &o 0r%a&% or 3%.& &,&(%, 'u& &o 0on$,r/ an" r%2,.&%r &,&(% a(r%a"y 3%.&%" an" %1,.&,n2 ,n &-% a**(,0an& $or a &,&(%. 2 !.". #o. $%&'(22.G T-% *%&,&,on%r. .*ou.%. F%(,*% 7a3," an" An&on,a G. 7a3," *ur0-a.%" *or&,on. o$ &-% Laon2 *ro*%r&y, 0on.,.&,n2 o$ 1;,555 .6uar% /%&%r., on F%'ruary 21, 196; $ro/ &-% .*ou.%. Gr%2or,o an" !ary F%n&uran8a, +-o, ,n &urn, *ur0-a.%" &-% *ro*%r&y $ro/ Juan,&a !ar&,n F"a. "% Lu0%na, on S%*&%/'%r 2:, 19;9. A& &-% &,/% 'o&- *ur0-a.%. &oo) *(a0%, &-% *ro*%r&y ,n 6u%.&,on +a. .&,(( an unr%2,.&%r%" (an". T-% (an" +a. r%2,.&%r%" ,n &-% na/% o$ Juan,&a !ar&,n on(y on Ju(y 1, 1971, &o +-o/ +a. ,..u%" OCT No. <916. %&,&,on%r. 0on&%n" &-a& &-% Cour& o$ A**%((%% %rr%" ,n -o(",n2 &-a& &-%y ar% 'uy%r. ,n 'a" $a,&-, ,n or"%r,n2 &-% 0an0%((a&,on o$ OCT No. <916 an" a(( .u'.%6u%n& &ran.$%r 0%r&,$,0a&%. o$ &,&(% "%r,3%" &-%r%$ro/, an" ,n or"%r,n2 *%&,&,on%r. - &o r%0on3%y &o r%.*on"%n&. &-%,r &+o&-,r" @2K:A *ro-,n",3,.o .-ar% o$ &-% (an" an" &o .%2r%2a&% &-%r%$ro/ 15,555 .6uar% /%&%r. $or r%0on3%yan0% &o r%.*on"%n&.. In a..a,(,n2 &-% "%0,.,on o$ &-% a**%((a&% 0our&, *%&,&,on%r. ,n3o)% &-% "o0&r,n% o$ ,n0on&ro3%r&,',(,&y o$ &-% "%0r%% o$ r%2,.&ra&,on a$&%r on% y%ar $ro/ ,..uan0%, an" &-% "o0&r,n% o$ 0on0(u.,3%n%.. an" ,n",3,.,',(,&y o$ &,&(%. ,..u%" un"%r &-% Torr%n. .y.&%/. %&,&,on%r. /,2-& -a3% .&oo" on .o(," 2roun" ,n ,n3o),n2 &-% a'o3% "o0&r,n%. ,$ &-%y -a" *ur0-a.%" &-%

*ro*%r&y $ro/ &-% r%2,.&%r%" o+n%r a$&%r &-% ,..uan0% o$ &-% "%0r%% o$ r%2,.&ra&,on an" &-% 0orr%.*on",n2 0%r&,$,0a&% o$ &,&(% ,n -,. na/%. : A. &-% r%0or" .-o+., *%&,&,on%r. 'ou2-& &-% *ro*%r&y +-%n ,& +a. .&,(( unr%2,.&%r%" (an". T-% "%$%n.% o$ -a3,n2 *ur0-a.%" &-% *ro*%r&y ,n 2oo" $a,&- /ay '% a3a,(%" o$ on(y +-%r% r%2,.&%r%" (an" ,. ,n3o(3%" an" &-% 'uy%r -a" r%(,%" ,n 2oo" $a,&- on &-% 0(%ar &,&(% o$ &-% r%2,.&%r%" o+n%r. On% +-o *ur0-a.%. an unr%2,.&%r%" (an" "o%. .o a& -,. *%r,( H,. 0(a,/ o$ -a3,n2 'ou2-& &-% (an" ,n 2oo" $a,&-, ,.%. +,&-ou& no&,0% &-a& .o/% o&-%r *%r.on -a. a r,2-& &o, or ,n&%r%.& ,n, &-% *ro*%r&y, +ou(" no& *ro&%0& -,/ ,$ ,& &urn. ou& &-a& &-% .%((%r "o%. no& a0&ua((y o+n &-% *ro*%r&y. T-,. ,. +-a& -a**%n%" ,n &-% 0a.% a& 'ar. !.".#o. $%&9'/+: In &-,. *%&,&,on, *%&,&,on%r. Jo.% Ra/,r%8 an" &-% -%,r. o$ A/'ro0,a . F"a. "% Ra/,r%8 @+,"o+ o$ So&%ro Ra/,r%8A, a..a,( &-% "%0,.,on o$ &-% r%.*on"%n& Cour& o$ A**%a(. "%0(ar,n2 &-%/ *ur0-a.%r. ,n 'a" $a,&- an" or"%r,n2 &-%/ &o r%0on3%y &o &-% *(a,n&,$$. Gr%2or,o Ban",n, Ray/un"a Ban",nMA Fa(%n&,n Br,on%. an" So&o Br,on%., $our-$,$&%%n&- @4K1;A .-ar% *ro,n",3,.o o$ &-% *ro*%r&,%. &-%y *ur0-a.%" $ro/ &-% .*ou.%. Ru$,no !,ran"a an" Na&,3,"a" Gu,n&o. T-% (an" ,n 6u%.&,on, 0on&a,n,n2 an ar%a o$ ;16 .6uar% /%&%r., /or% or (%.., +a. *ur0-a.%" 'y Jo.% Ra/,r%8 on Jun% 4, 1949. So&%ro Ra/,r%8 *ur0-a.%" -,. (an", +,&- an ar%a o$ 7;2 .6uar% /%&%r. on Ju(y 9, 194< an" !ay 15, 1949. T-%.% *ar0%(. o$ (an" *ur0-a.%" 'y &-% Ra/,r%8%. +%r% *ar& o$ &-% *or&,on o$ &-% Ta(on *ro*%r&y 'ou2-& 'y &-% .*ou.%. Ru$,no an" Na&,3,"a" !,ran"a $ro/ Can","a Ra/o., Eu(o2,o Ban",n an" A2a*,&a Ra/o. ,n 194:. T-% a**%((a&% 0our& -%(" &-a& Jo.% Ra/,r%8 an" -,. $a&-%r So&%ro Ra/,r%8 +%r% no& *ur0-a.%r. ,n 2oo" $a,&-, no& -a3,n2 /a"% ",(,2%n& ,n3%.&,2a&,on o$ &-% &ru% o+n%r.-,* o$ &-% *ro*%r&,%. &-%y 'ou2-&, 'u& r%(,%" /%r%(y on &-% &a1 "%0(ara&,on .-o+n &o &-%/ 'y &-% .%((%r, Ru$,no !,ran"a. L% -a3% no r%a.on &o ",.&ur' &-% $or%2o,n2 $,n",n2. o$ &-% r%.*on"%n& a**%((a&% 0our&. B%.,"%., a. /%n&,on%" %ar(,%r, &-% ,..u% o$ 2oo" $a,&- or 'a" $a,&- o$ &-% 'uy%r ,. r%(%3an& on(y +-%r% &-% .u'>%0& o$ &-% .a(% ,. r%2,.&%r%" (an" an" &-% *ur0-a.%r ,. 'uy,n2 &-% .a/% $ro/ &-% r%2,.&%r%" o+n%r, +-o.% &,&(% &o &-% (an" ,. 0(%an. In .u0- 0a.%, &-% *ur0-a.%r +-o r%(,%. on &-% 0(%an &,&(% o$ &-% r%2,.&%r%" o+n%r ,. *ro&%0&%" ,$ -% ,. a *ur0-a.%r ,n 2oo" $a,&- $or 3a(u%. Ho+%3%r, &-,. ,. no& &-% .,&ua&,on '%$or% u. ,n &-% ,n.&an& 0a.%, L-a& *%&,&,on%r. 'ou2-& +%r% unr%2,.&%r%" (an".. %&,&,on%r. 0on&%n" &-a& &-% r%.*on"%n&. ar% 'arr%" 'y %.&o**%( an" (a0-%. $ro/ r%0o3%r,n2 &-% *ro*%r&y ,n 6u%.&,on L% -a3% a(r%a"y "%a(& +,&- &-,. ,..u% a'o3%. L% $,n" &-% 0on&%n&,on +,&-ou& /%r,&. %&,&,on%r. .u22%.& &-a& &-% *or&,on or"%r%" &o '% &a)%n $ro/ &-% *ro*%r&,%. o$ Jo.% an" So&%ro Ra/,r%8 .-ou(" '% &a)%n ,n.&%a" $ro/ &-% .-ar%. +-,0- *%r&a,n &o an" ar% -%(" 'y &-% -%,r. o$ Can","a Ra/o.. L% "o no& $,n" &-% .u22%.&,on /%r,&or,ou.. T-% r%.*on"%n&. ar% %n&,&(%" &o &-%,r *ro- ,n",3,.o .-ar% o$ &-% *ro*%r&y un(a+$u((y .o(" 'y Can","a Ra/o., A2a*,&a Ra/o. an" Eu(o2,o Ban",n &o &-% !,ran"a .*ou.%. $ro/ +-o/ &-% *%&,&,on%r. 'ou2-& &-% *ar0%(. o$ (an" ,n 6u%.&,on. H%n0%, ,& +ou(" no& '% *ro*%r $or &-% 0our& &o r%.*on"%n&.= r,2-& &o r%0o3%r &-%,r *ro-,n",3,.o .-ar% o$ &-% *ro*%r&y on(y $ro/ &-% r%/a,n,n2 *or&,on .&,(( ,n &-% *o..%..,on o$ &-% -%,r. o$ Can","a Ra/o.. !.". #o. $%&9+12:

T-% 0a.% o$ !a2no "% (a Cru8 .&an". on ",$$%r%n& $oo&,n2 $ro/ &-% o&-%r *%&,&,on.. T-% *ro*%r&y *ur0-a.%" 'y -,/ $ro/ F,0&or,a !ar&,n an" !a1,/,na !ar&,n +%r% r%2,.&%r%" (an"., 0o3%r%" 'y Torr%n. &,&(%. B%,n2 a *ur0-a.%r ,n 2oo" $a,&- $or 3a(u%, !a2no "% (a Cru8 ,. *ro&%0&%" 'y &-% (a+. In &-% a'.%n0% o$ a .-o+,n2 &-a& -% -a" a0&ua( no&,0% o$ &-% "%$%0& ,n &-% &,&(% o$ &-% 3%n"or. or &-a& -% ,. a 'uy%r ,n 'a" $a,&- &-% "%%" o$ .a(% ,n -,. $a3or an" &-% 0orr%.*on",n2 0%r&,$,0a&% o$ &,&(% ,..u%" ,n -,. na/% 0an no& '% nu((,$,%" an" 0an0%((%". H%n0%, ,& +a. %rror $or &-% r%.*on"%n& 0our& &o ,n3a(,"a&% &-% .a(% /a"% 'y F,0&or,a an" !a1,/,na !ar&,n ,n $a3or o$ !a2no "% (a Cru8 &o &-% %1&%n& &-a& ,& *r%>u",0%" &-% &+o-&-,r" @2K:A *ro-,n",3,.o .-ar% o$ r%.*on"%n&. ,n &-% *ro*%r&y an" &o or"%r *%&,&,on%r &o r%0on3%y .a," .-ar% &o r%.*on"%n&.. T-% *%&,&,on o$ !a2no "% (a Cru8 ,. /%r,&or,ou., an" &-% "%0,.,on a**%a(%" $ro/ .-ou(" '% /o",$,%" a00or",n2(y. LHEREFORE, ,n 3,%+ o$ a(( &-% $or%2o,n2, >u"2/%n& ,. -%r%'y r%n"%r%"G 1. 7,./,..,n2 &-% *%&,&,on. ,n G.R. No.. L-4<:22, L-49716 an" L-496<7I 2. Gran&,n2 &-% *%&,&,on ,n G.R. No. L-49712, "%0(ar,n2 3a(," &-% "%%". o$ .a(% %1%0u&%" 'y F,0&or,a !ar&,n @E1-. <-!a2no "% (a Cru8A an" !a1,/,na !ar&,n @E1-. 4-!a2no "% (a Cru8A ,n $a3or o$ *%&,&,on%r !a2no "% (a Cru8, a. +%(( a. Tran.$%r C%r&,$,0a&% o$ T,&(% No. 1164;5 ,..u%" ,n &-% (a&&%r=. na/%, or"%r,n2 F,0&or,a !ar&,n an" !a1,/,na !ar&,n &o *ay &-% r%.*on"%n&. &+o-&-,r" @2K:A o$ &-% *r%.%n& 3a(u% o$ &-% *ro*%r&y .o(" 'y &-%/ &o !a2no "% (a Cru8, an" /o",$y,n2 &-% a**%a(%" "%0,.,on a00or",n2(yI an" :. A$$,r/,n2 &-% a**%a(%" "%0,.,on, %10%*& a. /o",$,%" a'o3%. No *ronoun0%/%n& a. &o 0o.&.. SO OR7ERE7.

G.R. No. L-:4;55 !ar0- 1<, 19<< !OISES OLIFARES an" JUANITA T. OLIFARES, petitioners$appellants, vs. THE HONORABLE CARLOS F. GONEALES a. Ju"2% o$ &-% Cour& o$ F,r.& In.&an0% o$ I(o,(o @Bran0- FIA, r%.*on"%n& an" JACINTO TUFILLA, CEFERINO TUFILLA, an" JUAN TU!ABINI, respondents$appellees. &ario 'uarina ((( for petitioners)appe ants. *nrique +rgue es for respondents)appe ees.

!ELENCIO-HERRERA, J.: )he ;isputed Property is a piece of unre istered land located at )i (auan, 2loilo 2dentified as Assessor5s @ot +o. =-=. 2t was previously owned (y respondents$appellees Jacinto )uvilla and *eferino )uvilla %the )uvillas, for short& (oth of )i (auan, 2loilo. !ometime in 1955, the )uvillas e3ecuted a <;eed of !ale with "i ht to "epurchase< in favor of respondent$appellee Juan )uma(ini over the ;isputed Property in consideration of the sum of P1,=5,.,,. )he document was duly ac0nowled ed (efore a +otary Pu(lic (ut was not recorded in the "e istry of Property. !ometime in 1959, the )uvillas e3ecuted a <;eed of !ale with Pacto de "etro< over the ;isputed Property in favor of petitioners$ appellants, 7oises 8livares and Juanita ). 8livares %the 8livareses, for short&. )his document was ac0nowled ed (efore a +otary Pu(lic and re istered with the "e istry of ;eeds. 2n 19??, the )uvillas also e3ecuted in favor of the 8livareses a <;eed of A(solute !ale< coverin the ;isputed Property. Petitioners$appellants have (een in possession of the ;isputed Property since 1959. 8n 8cto(er 11, 19?7, respondent$appellee, Juan )uma(ini filed *ivil *ase +o. 7-1, (efore /ranch 2 of the then *ourt of 9irst 2nstance of 2loilo a ainst the )uvillas for the consolidation of ownership over the ;isputed Property (y reason of the alle ed failure of the )uvillas to redeem the property from )uma(ini %hereinafter referred to as the *onsolidation *ase&. )he 8livareses, however, were not included as parties to the said case. ;urin the pre$trial of the *onsolidation *ase, counsel for the parties a reed to consider the pacto de retro sale as one of e'uita(le mort a e. )hus, the )rial *ourt rendered .ud ment in favor of )uma(ini in the amount of P 1,=5,.,,, pursuant to which, the *ourt su(se'uently issued a Drit of 13ecution on 8cto(er 2=, 19?A. 8n +ovem(er 2=, 19?A, the 8livareses instituted *ivil *ase +o. 7777 (efore /ranch V2 of the former *ourt of 9irst 2nstance of 2loilo, for Huietin of )itle, a ainst the )uvillas, Juan )uma(ini the Provincial !heriff and Pyramid !urety %hereinafter, the Huietin of )itle *ase&. )he said *ourt issued a "estrainin 8rder to stop the sale in the *onsolidation *ase %+o. 7-1,& pendin in /ranch 1, (ut the said order was lifted on 9e(ruary ?, 19?9. !u(se'uently, the *onsolidation *ase %+o. 7-1,&, the ;isputed Property was sold at pu(lic auction and a Drit of Possession was issued in )uma(inis favor. Bowever, the tenant of the 8livareses refused to surrender possession, promptin a citation for contempt. Action thereon was deferred, however, pendin termination of *ivil *ase +o. 7777. 8n July 7, 197,, in the Huietin of )itle *ase %+o. 7777&, the )rial *ourt issued an 8rder dismissin said case, as followsC Actin upon the motion for dismissal of this case filed (y Atty. 1nri'ue Ar uelles, counsel for the defendants, it appearin that the instant action has (een filed since +ovem(er 2=, 19?A and up to this time plaintiffs failed to e3ert effort to have the defendants summoned, for failure to prosecute and lac0 of interest on the part of the plaintiffs for such unreasona(le len th of time, as prayed, let this case (e dismissed +o reconsideration was sou ht nor any appeal ta0en (y the 8livareses.

8n July 1-, 1971, the same case was refiled, also in /ranch V2, doc0eted as *ivil *ase +o. A?9A %the "efiled *ase& which, however, was dismissed (y the *ourt on !eptem(er ?, 1971 <it appearin that *ivil *ase +o. 7777 previously filed and dismissed (y the *ourt em(races the same su(.ect matter and the same party liti ants as the case at (ar.< 8n !eptem(er 2,, 1971, the *ourt denied the 7otion for "econsideration filed (y the 8livareses. Bence, this appeal (y certiorari. )he 'uestion posed is whether the dismissal of the Huietin of )itle *ase %+o. 7777& <for failure to prosecute< (arred the institution of a su(se'uent suit, *ivil *ase +o. A?9A, (y the same plaintiff a ainst the same defendants on the same cause of action. !ection =, "ule 17 of the "ules of *ourt specifically providesC !ec. =. Fai ure to prosecute. > 2f plaintiff fails to appear at the time of the trial, or to prosecute his action for an unreasona(le len th of time, or to comply with these rules or any order of the court, the action may (e dismissed upon motion of the defendant or upon the court5s own motion. )his dismissal shall have the effect of an ad.udication upon the merits, unless otherwise provided (y the court. Procedurally spea0in , therefore, since the dismissal (y the )rial *ourt was un'ualified, it had the effect of an ad.udication upon the merits. Bowever, the e'uities of the case are with the 8livareses. )he first sale with pacto de retro (y the )uvillas to )uma(ini was unre istered6 in contrast, the sale in favor of the 8livareses was duly recorded. )he *onsolidation *ase %*ase +o. 7-1,& instituted (y )uma(ini a ainst the )uvillas for consolidation of his ownership did not include the 8livareses as parties defendants even thou h they were then in possession of the ;isputed Property. Justice and e'uity demand, therefore, that their side (e heard in the "efiled *ase %+o. A?9A&. )hen, too, the contempt incident and the matter of the Drit of Possession in the *onsolidation *ase %+o. 7-1,& were left unresolved pendin the outcome of the Huietin of )itle *ase %+o. 7777&. 2n other words, it would (e more in 0eepin with su(stantial .ustice if the controversy (etween the parties to (e resolved on the merits rather than on a procedural technicality in the li ht of the e3press mandate of the "ules that they (e <li(erally construed in order to promote their o(.ect and to assist the parties in o(tainin .ust, speedy and ine3pensive determination of every action and proceedin .< )he dismissal of actions is (ased on sound .udicial discretion and such discretion <must (e e3ercised wisely and prudently never capriciously, with a view to su(stantial .ustice.< 9or havin failed to meet that standard it will have to (e held that respondent Jud e acted with rave a(use of discretion %see )andoc vs. )ensuan, 2, 5,A=5, 8cto(er =,, 1979, 9= !*"A AA,&. DB1"198"1, the 'uestioned 8rder of dismissal, dated !eptem(er ?, 1971, in *ivil *ase +o. A?9A, is here(y !1) A!2;1 and the said case "17A+;1; for prompt hearin and determination on the merits. )his ;ecision sha (e immediately e3ecutory upon promul ation. +o costs. !8 8";1"1;.

S OUSES BONIFACIO R. FAL7EE, JR. an" FENI7A !. FAL7EE, Petitioners, vs. HON. COURT OF A EALS, S OUSES GABRIEL FABELLA an" FRANCISCA FABELLA, "espondents. ;1*2!28+ CHICO-NAEARIO, J.: )his petition for review under "ule -5 of the "ules of *ourt, filed (y petitioners spouses /onifacio ". Valde#, Jr. and Venida 7. Valde#, see0s to nullify and set aside the 22 April 1997 decision 1 and =, January 199A resolution of the *ourt of Appeals in *A$:.". !P +o. -=-92, which reversed the .ud ment, dated A January 1997, of the "e ional )rial *ourt of Antipolo, "i#al, /ranch 7-, in *ivil *ase +o. =?,7, which, in turn, affirmed in toto the decision rendered (y the 7unicipal )rial *ourt of Antipolo, "i#al, /ranch 22, in *ivil *ase +o. 25-7. )his case ori inated from a complaint for unlawful detainer filed (y petitioners /onifacio and Venida Valde# a ainst private respondents :a(riel and 9rancisca 9a(ella (efore the 7unicipal )rial *ourt of Antipolo, "i#al. )he complaint alle es these material factsC 2. )hat plaintiffs are the re istered ownerEsF of a piece of residential lot denominated as @ot E+Fo. = /l0 19 located at *arolina 13ecutive Villa e, /r y. !ta. *ru#, Antipolo, "i#al which EtheyF ac'uired from *arolina "ealty, 2nc. !ometime EiFn +ovem(er 1992 (y virtue of !ales *ontract, 3ero3 copy of which is hereto attached mar0ed as Anne3 <A< and the 3ero3 copy of the )orrens *ertificate of )itle in her name mar0ed as Anne3 </<6 =. )hat defendants, without any color of title whatsoever occupieEdF the said lot (y (uildin their house in the said lot there(y deprivin the herein plaintiffs ri htful possession thereof6 -. )hat for several times, plaintiffs orally as0ed the herein defendants to peacefully surrender the premises to them, (ut the latter stu((ornly refused to vacate the lot they unlawfully occupied6 5. )hat despite plaintiffsN referral of the matter to the /aran ay, defendants still refused to heed the plea of the former to surrender the lot peacefully6 ?. )hat (ecause of the unfounded refusal of the herein defendants to settle the case amica(ly, the /aran ay *aptain was forced to issue the necessary *ertification to 9ile Action in favor of the herein plaintiffs in order that the necessary cause of action (e ta0en (efore the proper court, 3ero3 copy of which is hereto attached mar0ed as Anne3 <*<6 7. )hat (y reason of the deli(erate, malicious and unfounded refusal of the defendants to vacateMsurrender the premises in 'uestion, the herein plaintiffs were constrained to en a e

the professional services of counsel thus incurrin e3penses amountin to )1+ )B84!A+; P1!8! %P1,,,,,.,,& representin acceptance fee and additional 8+1 )B84!A+; P1!8! %P1,,,,.,,& per appearance, who on July 12, 199- sent a formal demand was li0ewise i nored, %sic& copy of which is hereto attached as Anne3 <;<6 A. )hat li0ewise (y virtue of the adamant refusal of the defendants to vacateMsurrender the said premises in 'uestion, plaintiffEsF suffered serious an3iety, sleepless ni hts, mental torture and moral erosion6 3 3 32 2n their answer, private respondents contended that the complaint failed to state that petitioners had prior physical possession of the property or that they were the lessors of the former. 2n the alternative, private respondents claimed ownership over the land on the round that they had (een in open, continuous, and adverse possession thereof for more than thirty years, as attested (y an ocular inspection report from the ;epartment of 1nvironment and +atural "esources. )hey also stressed that the complaint failed to comply with !upreme *ourt *ircular +o. 2A$91 re ardin affidavits a ainst non$forum shoppin . )he 7unicipal )rial *ourt %7)*& rendered a decision in favor of the petitioners, orderin private respondents to vacate the property and to pay rent for the use and occupation of the same plus attorneyNs fees. Private respondents appealed the 7)*Ns decision to the "e ional )rial *ourt %")*&. )he ")*, in a decision dated A January 1997, affirmed in toto the decision of the 7)*. 4ndeterred, the private respondents filed a petition for review with the *ourt of Appeals on 1, 7arch 1997 'uestionin the decision of the ")*. 2n a decision dated 22 April 1997, the *ourt of Appeals reversed and set aside the decision of the ")*. 2t held that petitioners failed to ma0e a case for unlawful detainer (ecause they failed to show that they had iven the private respondents the ri ht to occupy the premises or that they had tolerated private respondentsN possession of the same, which is a re'uirement in unlawful detainer cases. 2t added that the alle ations in petitionersN complaint lac0 .urisdictional elements for forci(le entry which re'uires an alle ation of prior material possession. )he *ourt of Appeals ratiocinated thusC An e3amination of the complaint reveals that 0ey .urisdictional alle ations that will support an action for e.ectment are conspicuously lac0in . 2n particular, an alle ation of prior material possession is mandatory in forci(le entry, 333 and the complaint is deficient in this respect. 8n the other hand, neither does there appear to (e a case of unlawful detainer, since the private respondents failed to show that they had iven the petitioners the ri ht to occupy the premises, which ri ht has now E(eenF e3tin uished. 333 2n li ht of the fore oin , the conclusion is inevita(le that the 7unicipal )rial *ourt (efore which the action for e.ectment was filed had no .urisdiction over the case. *onse'uently, the dismissal thereof is in order. DB1"198"1, the Petition is here(y :2V1+ ;41 *84"!1, and :"A+)1;. )he decision dated ,A January 1997 rendered (y the respondent court is here(y "1V1"!1; and !1) A!2;1, and

.ud ment is here(y rendered ;2!72!!2+: the complaint in *ivil *ase +o. 25-7 of the 7unicipal )rial *ourt of Antipolo, "i#al for lac0 of .urisdiction. = Petitioners filed a motion for reconsideration which was denied in a resolution dated =, January 199A.Bence, the instant petition. Petitioners su(mit the followin issues for the *ourtNs consideration 5C A. DB1)B1" 8" +8) )B1 A@@1:A)28+! 89 )B1 *87P@A2+) *@1A"@G 7A;1 84) A *A!1 98" 4+@AD94@ ;1)A2+1". /. DB1)B1" 8" +8) /A!1; 8+ )B1 A@@1:A)28+%!& 89 )B1 *87P@A2+), )B1 74+2*2PA@ )"2A@ *84") 89 A+)2P8@8, "2IA@, *@1A"@G BA! 8"2:2+A@ J4"2!;2*)28+ 8V1" )B1 2+!)A+) *87P@A2+) 92@1; /198"1 2). !ince the two issues are closely intertwined, they shall (e discussed to ether. 2n the main, petitioners claim that the averments of their complaint ma0e out a case for unlawful detainer havin alle ed that private respondents unlawfully withheld from them the possession of the property in 'uestion, which alle ation is sufficient to esta(lish a case for unlawful detainer. )hey further contend that the summary action for e.ectment is the proper remedy availa(le to the owner if another occupies the land at the formerNs tolerance or permission without any contract (etween the two as the latter is (ound (y an implied promise to vacate the land upon demand (y the owner. )he petition is not meritorious. 4nder e3istin law and .urisprudence, there are three 0inds of actions availa(le to recover possession of real propertyC %a& accion interdicta 6 %(& accion pub iciana6 and %c& accion reivindicatoria.? +ccion interdicta comprises two distinct causes of action, namely, forci(le entry %detentacion& and unlawful detainer %desahuico&.7 2n forci(le entry, one is deprived of physical possession of real property (y means of force, intimidation, strate y, threats, or stealth whereas in unlawful detainer, one ille ally withholds possession after the e3piration or termination of his ri ht to hold possession under any contract, e3press or implied. A )he two are distin uished from each other in that in forci(le entry, the possession of the defendant is ille al from the (e innin , and that the issue is which party has prior de facto possession while in unlawful detainer, possession of the defendant is ori inally le al (ut (ecame ille al due to the e3piration or termination of the ri ht to possess. 9 )he .urisdiction of these two actions, which are summary in nature, lies in the proper municipal trial court or metropolitan trial court.1, /oth actions must (e (rou ht within one year from the date of actual entry on the land, in case of forci(le entry, and from the date of last demand, in case of unlawful detainer.11 )he issue in said cases is the ri ht to physical possession. +ccion pub iciana is the plenary action to recover the ri ht of possession which should (e (rou ht in the proper re ional trial court when dispossession has lasted for more than one year. 12 2t is an ordinary civil proceedin to determine the (etter ri ht of possession of realty independently of title.1= 2n other words, if at the time of the filin of the complaint more than one year had elapsed since defendant had turned plaintiff out of possession or defendantNs possession had (ecome ille al,

the action will (e, not one of the forci(le entry or ille al detainer, (ut an accion pub iciana. 8n the other hand, accion reivindicatoria is an action to recover ownership also (rou ht in the proper re ional trial court in an ordinary civil proceedin . 1)o .ustify an action for unlawful detainer, it is essential that the plaintiffNs supposed acts of tolerance must have (een present ri ht from the start of the possession which is later sou ht to (e recovered.15 8therwise, if the possession was unlawful from the start, an action for unlawful detainer would (e an improper remedy.1? As e3plained in !arona v. Ville as17C /ut even where possession precedin the suit is (y tolerance of the owner, still, distinction should (e made. 2f ri ht at the incipiency defendantNs possession was with plaintiffNs tolerance, we do not dou(t that the latter may re'uire him to vacate the premises and sue (efore the inferior court under !ection 1 of "ule 7,, within one year from the date of the demand to vacate. 3333 + c ose assessment of the aw and the concept of the word ,to erance, confirms our view heretofore e-pressed that such to erance must be present right from the start of possession sought to be recovered, to categori.e a cause of action as one of un awfu detainer ) not of forcib e entry. 2ndeed, to hold otherwise would espouse a dan erous doctrine. And for two reasonsC First. 9orci(le entry into the land is an open challen e to the ri ht of the possessor. Violation of that ri ht authori#es the speedy redress O in the inferior court $ provided for in the rules. 2f one year from the forci(le entry is allowed to lapse (efore suit is filed, then the remedy ceases to (e speedy6 and the possessor is deemed to have waived his ri ht to see0 relief in the inferior court. !econd, if a forci(le entry action in the inferior court is allowed after the lapse of a num(er of years, then the result may well (e that no action of forci(le entry can really prescri(e. +o matter how lon such defendant is in physical possession, plaintiff will merely ma0e a demand, (rin suit in the inferior court O upon a plea of tolerance to prevent prescription to set in $ and summarily throw him out of the land. !uch a conclusion is unreasona(le. 1specially if we (ear in mind the postulates that proceedin s of forci(le entry and unlawful detainer are summary in nature, and that the one year time$(ar to suit is (ut in pursuance of the summary nature of the action.1A %4nderlinin supplied& 2t is the nature of defendantNs entry into the land which determines the cause of action, whether it is forci(le entry or unlawful detainer. 2f the entry is ille al, then the action which may (e filed a ainst the intruder is forci(le entry. 2f, however, the entry is le al (ut the possession thereafter (ecomes ille al, the case is unlawful detainer. 2ndeed, to vest the court .urisdiction to effect the e.ectment of an occupant, it is necessary that the complaint should em(ody such a statement of facts as (rin s the party clearly within the class of cases for which the statutes provide a remedy, as these proceedin s are summary in nature. 19 )he complaint must show enou h on its face the court .urisdiction without resort to parol testimony. 2, )he .urisdictional facts must appear on the face of the complaint. Dhen the complaint fails to aver facts constitutive of forci(le entry or unlawful detainer, as where it does not state how entry was affected or how and when dispossession started, the remedy should either (e an accion pu(liciana or an accion reivindicatoria in the proper re ional trial court. 21 )hus, in :o, Jr. v. *ourt of Appeals,22 petitioners filed an unlawful detainer case a ainst respondent alle in that they were the owners of the parcel of land throu h intestate succession which was occupied (y respondent (y mere tolerance of petitioners as well as their deceased mother. "esolvin the issue on whether or not petitionersN case for unlawful detainer will prosper, the court ruled 2=C

Petitioners alle ed in their complaint that they inherited the property re istered under )*) +o. *$ =211, from their parents6 that possession thereof (y private respondent was (y tolerance of their mother, and after her death, (y their own tolerance6 and that they had served written demand on ;ecem(er, 199-, (ut that private respondent refused to vacate the property. 3 3 3 2t is settled that one whose stay is merely tolerated (ecomes a deforciant ille ally occupyin the land the moment he is re'uired to leave. 2t is essential in unlawful detainer cases of this 0ind, that plaintiffNs supposed acts of tolerance must have (een present ri ht from the start of the possession which is later sou ht to (e recovered. )his is where petitionersN cause of action fails. )he appellate court, in full a reement with the 7)* made the conclusion that the alle ed tolerance (y their mother and after her death, (y them, was unsu(stantiated. 3 3 3 )he evidence revealed that the possession of defendant was ille al at the inception and not merely tolerated as alle ed in the complaint, considerin that defendant started to occupy the su(.ect lot and then (uilt a house thereon without the permission and consent of petitioners and (efore them, their mother. 333 *learly, defendantNs entry into the land was effected clandestinely, without the 0nowled e of the owners, conse'uently, it is cate ori#ed as possession (y stealth which is forci(le entry. As e3plained in !arona vs. /i egas, cited in &u$o. vs. 0ourt of+ppea s E22- !*"A 21? %1992&F tolerance must (e present ri ht from the start of possession sou ht to (e recovered, to cate ori#e a cause of action as one of unlawful detainer not of forci(le entry 3 3 3. And in the case of )en 9orty "ealty and ;evelopment *orp. v. *ru#,2- petitionerNs complaint for unlawful detainer merely contained the (are alle ations that %1& respondent immediately occupied the su(.ect property after its sale to her, an action merely tolerated (y petitioner6 and %2& her alle edly ille al occupation of the premises was (y mere tolerance. )he court, in findin that the alle ed tolerance did not .ustify the action for unlawful detainer, heldC )o .ustify an action for unlawful detainer, the permission or tolerance must have (een present at the (e innin of the possession. 3 3 3 3333 2n this case, the *omplaint and the other pleadin s do not recite any averment of fact that would su(stantiate the claim of petitioner that it permitted or tolerated the occupation of the property (y "espondent *ru#. )he complaint contains only (are alle ations that 1& respondent immediately occupied the su(.ect property after its sale to her, an action merely tolerated (y petitioner6 and 2& her alle edly ille al occupation of the premises was (y mere tolerance. )hese alle ations contradict, rather than support, petitionerNs theory that its cause of action is for unlawful detainer. First, these ar uments advance the view that respondentNs occupation of the property was unlawful at its inception. !econd, they counter the essential re'uirement in unlawful detainer cases that petitionerNs supposed act of sufferance or tolerance must (e present ri ht from the start of a possession that is later sou ht to (e recovered. 25 2n the instant case, the alle ations in the complaint do not contain any averment of fact that would su(stantiate petitionersN claim that they permitted or tolerated the occupation of the property (y respondents. )he complaint contains only (are alle ations that <respondents without any color of title whatsoever occupies the land in 'uestion (y (uildin their house in the said land there(y deprivin petitioners the possession thereof.< +othin has (een said on how respondentsN entry was effected or how and when dispossession started. Admittedly, no e3press contract e3isted (etween the parties. )his failure of petitioners to alle e the 0ey .urisdictional facts constitutive of unlawful detainer is fatal.2? !ince the complaint did not satisfy the .urisdictional re'uirement of a valid cause

for unlawful detainer, the municipal trial court had no .urisdiction over the case. 27 2t is in this li ht that this *ourt finds that the *ourt of Appeals correctly found that the municipal trial court had no .urisdiction over the complaint. DB1"198"1, the petition is ;1+21; and the .ud ment of the *ourt of Appeals dismissin the complaint in *ivil *ase +o. 25-7 of the 7)* Antipolo, "i#al for lac0 of .urisdiction is here(y A992"71;. +o pronouncement as to costs. !8 8";1"1;.

BG.R. No. 1;1<1;. F%'ruary 2:, 255;C

S OUSES JUAN NUGUI7 AN7 ERLIN7A T. NUGUI7, etitioners, -s. HON. COURT OF A EALS AN7 E7RO . ECSON, res ondents. 7ECISION
JUISU!BING, J.G

)his is a petition for review on certiorari of the 7%0,.,on dated 7ay 21, 2,,1, of the *ourt of Appeals in *A$:.". *V +o. ?-295, which modified the 8rder dated July =1, 199A of the "e ional )rial *ourt %")*& of Hue#on *ity, /ranch 1,1 in *ivil *ase +o. H$-1-7,. )he trial court ordered the defendants, amon them petitioner herein Juan +u uid, to pay respondent herein Pedro P. Pecson, the sum of P1,=--,,,, as reim(ursement of unreali#ed income for the period (e innin +ovem(er 22, 199= to ;ecem(er 1997. )he appellate court, however, reduced the trial courtNs award in favor of Pecson from the said P1,=--,,,, to P2A,,,,,. 1'ually assailed (y the petitioners is the appellate courtNs R%.o(u&,on dated January 1,, 2,,2, denyin the motion for reconsideration.
E1F E2F

2t may (e recalled that relatedly in our ;ecision dated 7ay 2?, 1995, in :.". +o. 115A1-, entitled 1ecson v. 0ourt of +ppea s, we set aside the decision of the *ourt of Appeals in *A$:.". !P +o. =2?79 and the 8rder dated +ovem(er 15, 199=, of the ")* of Hue#on *ity, /ranch 1,1 and remanded the case to the trial court for the determination of the current mar0et value of the four$door two$storey apartment (uildin on the 25?$s'uare meter commercial lot.

)he antecedent facts in this case are as followsC Pedro P. Pecson owned a commercial lot located at 27 Pamias "oad, Hue#on *ity, on which he (uilt a four$door two$storey apartment (uildin . 9or failure to pay realty ta3es, the lot was sold at pu(lic auction (y the *ity )reasurer of Hue#on *ity to 7amerto +epomuceno, who in turn sold it for P1,=,,,, to the spouses Juan and 1rlinda +u uid. Pecson challen ed the validity of the auction sale (efore the ")* of Hue#on *ity in *ivil *ase +o. H$-1-7,. 2n its ;ecision, dated 9e(ruary A, 19A9, the ")* upheld the spousesN title (ut declared that the four$door two$ storey apartment (uildin was not included in the auction sale. )his was affirmed in toto (y the *ourt of Appeals and thereafter (y this *ourt, in its ;ecision dated 7ay 25, 199=, in :.". +o. 1,5=?, entitled 1ecson v. 0ourt of +ppea s.
E=F E-F E5F

8n June 2=, 199=, (y virtue of the 1ntry of Jud ment of the aforesaid decision in :.". +o. 1,5=?,, the +u uids (ecame the uncontested owners of the 25?$s'uare meter commercial lot. As a result, the +u uid spouses moved for delivery of possession of the lot and the apartment (uildin . 2n its 8rder of +ovem(er 15, 199=, the trial court, relyin upon Article 5-? of the *ivil *ode, ruled that the !pouses +u uid were to reim(urse Pecson for his construction cost of P5=,,,,, followin which, the spouses +u uid were entitled to immediate issuance of a writ of possession over the lot and improvements. 2n the same order the ")* also directed Pecson to pay the same amount of monthly rentals to the +u uids as paid (y the tenants occupyin the apartment units or P21,,,, per month from June 2=, 199=, and allowed the offset of the amount of P5=,,,, due from the +u uids a ainst the amount of rents collected (y Pecson from June 2=, 199= to !eptem(er 2=, 199= from the tenants of the apartment.
E?F E7F EAF

Pecson duly moved for reconsideration, (ut on +ovem(er A, 199=, the ")* issued a Drit of Possession, directin the deputy sheriff to put the spouses +u uid in possession of the su(.ect property with all the improvements thereon and to e.ect all the occupants therein.
E9F

A rieved, Pecson then filed a special civil action for certiorari and prohi(ition doc0eted as *A$:.". !P +o. =2?79 with the *ourt of Appeals. 2n its decision of June 7, 199-, the appellate court, relyin upon Article --A of the *ivil *ode, affirmed the order of payment of construction costs (ut rendered the issue of possession moot on appeal, thusC
E1,F

WHEREFORE, while it appears that private respondents [spouses Nuguid] have not yet indemnified petitioner [Pe son] with the ost of the improvements, sin e !nne" # shows that the $eputy %heriff has enfor ed the Writ of Possession and the premises have &een turned over to the possession of private respondents, the 'uest of petitioner that he &e restored in possession of the premises is rendered moot and a ademi , although it is &ut fair and (ust that private respondents pay petitioner the onstru tion ost of P)*,+++,++- and that petitioner &e ordered to a ount for any and all fruits of the improvements re eived &y him starting on .une /*, 011*, with the amount of P)*,+++,++ to &e offset therefrom, #2 #% %O OR$ERE$, [3nders oring supplied,]
E11F

9rustrated (y this turn of events, Pecson filed a petition for review doc0eted as :.". +o. 115A1- (efore this *ourt. 8n 7ay 2?, 1995, the *ourt handed down the decision in :.". +o 115A1-, to witC WHEREFORE, the de ision of the 4ourt of !ppeals in 4!56,R, %P No, */781 and the Order of 0) Novem&er 011* of the Regional 2rial 4ourt, 9ran h 0+0, :ue;on 4ity in 4ivil 4ase No, :5<0<8+ are here&y %E2 !%#$E, 2he ase is here&y remanded to the trial ourt for it to determine the urrent mar=et value of the apartment &uilding on the lot, For this purpose, the parties shall &e allowed to addu e eviden e on the urrent mar=et value of the apartment &uilding, 2he value so determined shall &e forthwith paid &y the private respondents [%pouses .uan and Erlinda Nuguid] to the petitioner [Pedro Pe son] otherwise the petitioner shall &e restored to the possession of the apartment &uilding until payment of the re'uired indemnity, No osts, %O OR$ERE$, [Emphasis supplied,]
E12F

2n so rulin , this *ourt pointed out thatC %1& Article --A of the *ivil *ode is not apposite to the case at (ar where the owner of the land is the (uilder, sower, or planter who then later lost ownership of the land (y sale, (ut may, however, (e applied (y analo y6 %2& the current mar0et value of the improvements should (e made as the (asis of reim(ursement6 %=& Pecson was entitled to retain ownership of the (uildin and, necessarily, the income therefrom6 %-& the *ourt of Appeals erred not only in upholdin the trial courtNs

determination of the indemnity, (ut also in orderin Pecson to account for the rentals of the apartment (uildin from June 2=, 199= to !eptem(er 2=, 199=. 8n the (asis of this *ourtNs decision in :.". +o. 115A1-, Pecson filed a 7otion to "estore Possession and a 7otion to "ender Accountin , prayin respectively for restoration of his possession over the su(.ect 25?$s'uare meter commercial lot and for the spouses +u uid to (e directed to render an accountin under oath, of the income derived from the su(.ect four$door apartment from +ovem(er 22, 199= until possession of the same was restored to him. 2n an 8rder dated January 2?, 199?, the ")* denied the 7otion to "estore Possession to the plaintiff averrin that the current mar0et value of the (uildin should first (e determined. Pendin the said determination, the resolution of the 7otion for Accountin was li0ewise held in a(eyance.
E1=F

Dith the su(mission of the partiesN assessment and the reports of the su(.ect realty, and the reports of the Hue#on *ity Assessor, as well as the mem(ers of the duly constituted assessment committee, the trial court issued the followin 8rder dated 8cto(er 7, 1997, to witC
E1-F

On Novem&er /0, 0117, the parties manifested that they have arrived at a ompromise agreement that the value of the said improvement>&uilding is P<++,+++,++ 2he 4ourt notes that the plaintiff has already re eivedP*++,+++,++, However, when defendant was ready to pay the &alan e of P0++,+++,++, the plaintiff now insists that there should &e a rental to &e paid &y defendants, Whether or not this should &e paid &y defendants, in ident is here&y s heduled for hearing on Novem&er 0/, 0118 at ?@*+ a,m, Aeantime, defendants are dire ted to pay plaintiff the &alan e of P0++,+++,++, %O OR$ERE$,
E15F

8n ;ecem(er 1997, after payin the said P1,,,,,, (alance to Pedro Pecson the spouses +u uid prayed for the closure and termination of the case, as well as the cancellation of the notice of is pendens on the title of the property on the round that Pedro PecsonNs claim for rentals was devoid of factual and le al (ases.
E1?F

After conductin a hearin , the lower court issued an 8rder dated July =1, 199A, directin the spouses to pay the sum of P1,=--,,,, as reim(ursement of the unreali#ed income of Pecson for the period (e innin +ovem(er 22, 199= up to ;ecem(er 1997. )he sum was (ased on the computation of P2A,,,,Mmonth rentals of the four$door apartment, thusC

2he 4ourt finds plaintiffBs motion valid and meritorious, 2he de ision of the %upreme 4ourt in the aforesaid ase [Pecson vs. Court of Appeals, /<< %4R! <+8] whi h set aside the Order of this 4ourt of Novem&er 0), 011* has in effe t upheld plaintiffBs right of possession of the &uilding for as long as he is not fully paid the value thereof, #t follows, as de lared &y the %upreme 4ourt in said de ision that the plaintiff is entitled to the in ome derived therefrom, thus C , , , Re ords show that the plaintiff was dispossessed of the premises on Novem&er //, 011* and that he was fully paid the value of his &uilding in $e em&er 0118, 2herefore, he is entitled to the in ome thereof &eginning onNovem&er //, 011*, the time he was dispossessed, up to the time of said full payment, in $e em&er 0118, or a total of <? months, 2he only 'uestion left is the determination of in ome of the four units of apartments per month, 9ut as orre tly pointed out &y plaintiff, the defendants have themselves su&mitted their affidavits attesting that the in ome derived from three of the four units of the apartment &uilding is P/0,+++,++ or P8,+++,++ ea h per month, or P/?,+++,++ per month for the whole four units, Hen e, at P/?,+++,++ per month, multiplied &y <? months, plaintiff is entitled to &e paid &y defendants the amount of P0,*<<,+++,++,
E17F

)he +u uid spouses filed a motion for reconsideration (ut this was denied for lac0 of merit.
E1AF

)he +u uid couple then appealed the trial courtNs rulin to the *ourt of Appeals, their action doc0eted as *A$:.". *V +o. ?-295. 2n the *ourt of Appeals, the order appealed from in *A$:.". *V +o. ?-295, was modified. )he *A reduced the rentals from P1,=--,,,, to P2A,,,,, in favor of the appellee. )he said amount represents accrued rentals from the determination of the current mar0et value on January =1, 1997 until its full payment on ;ecem(er 12, 1997.
E19F E2,F

Bence, petitioners state the sole assi nment of error now (efore us as followsC 2HE 4O3R2 OF !PPE!D% ERRE$ #N HOD$#N6 PE2#2#ONER% D#!9DE 2O P!E REN2 OFER !N$ !9OFE 2HE 43RREN2 A!RGE2 F!D3E OF 2HE #APROFEAEN2 WHEN %34H W!% NO2 PROF#$E$ FOR #N 2HE $#%PO%#2#FE POR2#ON OF 2HE %3PREAE 4O3R2B% R3D#N6 #N 6,R, No, 00)?0<,

Petitioners call our attention to the fact that after reachin an a reed price of P-,,,,,, for the improvements, they only made a partial payment of P=,,,,,,. )hus, they contend that their failure to pay the full price for the improvements will, at most, entitle respondent to (e restored to possession, (ut not to collect any rentals. Petitioners insist that this is the proper interpretation of the dispositive portion of the decision in :.". +o. 115A1-, which states in part that QEtFhe value so determined shall (e forthwith paid (y the private respondents E!pouses Juan and 1rlinda +u uidF to the petitioner EPedro PecsonF o&-%r+,.% the petitioner shall (e restored to the possession of the apartment (uildin until payment of the re'uired indemnity.R
E21F

+ow herein respondent, Pecson, disa rees with herein petitionersN contention. Be ar ues that petitioners are wron in claimin that inasmuch as his claim for rentals was not determined in the dispositive portion of the decision in :.". +o. 115A1-, it could not (e the su(.ect of e3ecution. Be points out that in movin for an accountin , all he as0ed was that the value of the fruits of the property durin the period he was dispossessed (e accounted for, since this *ourt e3plicitly reco ni#ed in :.". +o. 115A1-, he was entitled to the property. Be points out that this *ourt ruled that QEtFhe petitioner EPecsonF not havin (een so paid, he was entitled to retain ownership of the (uildin and, necessarily, the income therefrom.R 2n other words, says respondent, accountin was necessary. 9or accordin ly, he was entitled to rental income from the property. )his should (e iven effect. )he *ourt could have very well specifically included rent %as fruit or income of the property&, (ut could not have done so at the time the *ourt pronounced .ud ment (ecause its value had yet to (e determined, accordin to him. Additionally, he faults the appellate court for modifyin the order of the ")*, thus defeatin his ri ht as a (uilder in ood faith entitled to rental from the period of his dispossession to full payment of the price of his improvements, which spans from +ovem(er 22, 199= to ;ecem(er 1997, or a period of more than four years.
E22F

2t is not disputed that the construction of the four$door two$storey apartment, su(.ect of this dispute, was underta0en at the time when Pecson was still the owner of the lot. Dhen the +u uids (ecame the uncontested owner of the lot on June 2=, 199=, (y virtue of entry of .ud ment of the *ourtNs decision, dated 7ay 25, 199=, in :.". +o. 1,5=?,, the apartment (uildin was already in e3istence and occupied (y tenants. 2n its decision dated 7ay 2?, 1995 in :.". +o. 115A1-, the *ourt declared the ri hts and o(li ations of the liti ants in accordance with Articles --A and 5-? of the *ivil *ode. )hese provisions of the *ode are directly applica(le to the instant case.

4nder Article --A, the landowner is iven the option, either to appropriate the improvement as his own upon payment of the proper amount of indemnity or to sell the land to the possessor in ood faith. "elatedly, Article 5-? provides that a (uilder in ood faith is entitled to full reim(ursement for all the necessary and useful e3penses incurred6 it also ives him ri ht of retention until full reim(ursement is made. Dhile the law aims to concentrate in one person the ownership of the land and the improvements thereon in view of the impractica(ility of creatin a state of forced co$ownership, it uards a ainst un.ust enrichment insofar as the ood$faith (uilderNs improvements are concerned. )he ri ht of retention is considered as one of the measures devised (y the law for the protection of (uilders in ood faith. 2ts o(.ect is to uarantee full and prompt reim(ursement as it permits the actual possessor to remain in possession while he has not (een reim(ursed %(y the person who defeated him in the case for possession of the property& for those necessary e3penses and useful improvements made (y him on the thin possessed. Accordin ly, a (uilder in ood faith cannot (e compelled to pay rentals durin the period of retention nor (e distur(ed in his possession (y orderin him to vacate. 2n addition, as in this case, the owner of the land is prohi(ited from offsettin or compensatin the necessary and useful e3penses with the fruits received (y the (uilder$possessor in ood faith. 8therwise, the security provided (y law would (e impaired. )his is so (ecause the ri ht to the e3penses and the ri ht to the fruits (oth pertain to the possessor, ma0in compensation .uridically impossi(le6 and one cannot (e used to reduce the other.
E2=F E2-F E25F E2?F

As we earlier held, since petitioners opted to appropriate the improvement for themselves as early as June 199=, when they applied for a writ of e3ecution despite 0nowled e that the auction sale did not include the apartment (uildin , they could not (enefit from the lotNs improvement, until they reim(ursed the improver in full, (ased on the current mar0et value of the property. ;espite the *ourtNs reco nition of PecsonNs ri ht of ownership over the apartment (uildin , the petitioners still insisted on dispossessin Pecson (y filin for a Drit of Possession to cover (oth the lot and the (uildin . *learly, this resulted in a violation of respondentNs ri ht of retention. Dorse, petitioners too0 advanta e of the situation to (enefit from the hi hly valued, income$yieldin , four$unit apartment (uildin (y collectin rentals thereon, (efore they paid for the cost of the apartment (uildin . 2t was only four years later that they finally paid its full value to the respondent.

PetitionersN interpretation of our holdin in :.". +o. 115A1- has neither factual nor le al (asis. )he decision of 7ay 2?, 1995, should (e construed in connection with the le al principles which form the (asis of the decision, uided (y the precept that .ud ments are to have a reasona(le intendment to do .ustice and avoid wron .
E27F

)he te3t of the decision in :.". +o. 115A1- e3pressly e3empted Pecson from lia(ility to pay rentals, for we found that the *ourt of Appeals erred not only in upholdin the trial courtNs determination of the indemnity, (ut also in orderin him to account for the rentals of the apartment (uildin from June 2=, 199= to !eptem(er 2=, 199=, the period from entry of .ud ment untilPecsonNs dispossession. As pointed out (y Pecson, the dispositive portion of our decision in :.". +o. 115A1- need not specifically include the income derived from the improvement in order to entitle him, as a (uilder in ood faith, to such income. )he ri ht of retention, which entitles the (uilder in ood faith to the possession as well as the income derived therefrom, is already provided for under Article 5-? of the *ivil *ode. :iven the circumstances of the instant case where the (uilder in ood faith has (een clearly denied his ri ht of retention for almost half a decade, we find that the increased award of rentals (y the ")* was reasona(le and e'uita(le. )he petitioners had reaped all the (enefits from the improvement introduced (y the respondent durin said period, without payin any amount to the latter as reim(ursement for his construction costs and e3penses. )hey should account and pay for such (enefits. De need not (ela(or now the appellate courtNs reco nition of herein respondentNs entitlement to rentals from the date of the determination of the current mar0et value until its full payment. "espondent is clearly entitled to payment (y virtue of his ri ht of retention over the said improvement. LHEREFORE, the instant petition is ;1+21; for lac0 of merit. )he ;ecision dated 7ay 21, 2,,1 of the *ourt of Appeals in *A$:.". *V +o. ?-295 is !1) A!2;1 and the 8rder dated July =1, 199A, of the "e ional )rial *ourt, /ranch 1,1, Hue#on *ity, in *ivil *ase +o. H$-1-7, orderin the herein petitioners, !pouses Juan and 1rlinda +u uid, to account for the rental income of the four$door two$storey apartment (uildin from +ovem(er 199= until ;ecem(er 1997, in the amount of P1,=--,,,,, computed on the (asis of )wenty$ei ht )housand %P2A,,,,.,,& pesos monthly, for a period of -A months, is here(y "12+!)A)1;. 4ntil fully paid, said amount of rentals should (ear the le al rate of interest set at si3 percent %?S& per annum computed from the date of ")* .ud ment. 2f any portion thereof shall thereafter remain unpaid, despite notice of finality of this *ourtNs .ud ment,

said remainin unpaid amount shall (ear the rate of interest set at twelve percent %12S& per annum computed from the date of said notice. *osts a ainst petitioners. SO OR7ERE7.

G.R. No. <:4:2 !ay 25, 1991 RA7IOLEALTH FINANCE CO! AND, petitioner, vs. !ANUELITO S. ALILEO, respondent. 2o ando +. 0a ang for petitioner. !isenando /i a u., !r. for respondent.

GANCADCO, J.: 2f the same piece of land was sold to two different purchasers, to whom shall ownership (elon K Article 15-- of the *ivil *ode provides that in case of dou(le sale of an immova(le property, ownership shall (e transferredC %1& to the person ac'uirin it who in ood faith first recorded it in the "e istry of Property6 %2& in default thereof, to the person who in ood faith was first in possession6 and %=& in default thereof, to the person who presents the oldest title, provided there is ood faith. )here is no am(i uity re ardin the application of the law with respect to lands re istered under the )orrens !ystem. !ection 51 of Presidential ;ecree +o. 1529 %amendin !ection 5, of Act +o. -9? clearly provides that the act of re istration is the operative act to convey or affect re istered lands insofar as third persons are concerned. )hus, a person dealin with re istered land is not re'uired to o (ehind the re ister to determine the condition of the property. Be is only char ed with notice of the (urdens on the property which are noted on the face of the re ister or certificate of title. 1 9ollowin this principle, this *ourt has time and a ain held that a purchaser in ood faith of re istered land %covered (y a )orrens )itle& ac'uires a ood title as a ainst all the transferees thereof whose ri ht is not recorded in the re istry of deeds at the time of the sale. 2 )he 'uestion that has to (e resolved in the instant petition is whether or not the rule provided in Article 15-- of the *ivil *ode as discussed a(ove, is applica(le to a parcel of unre istered land purchased at a .udicial sale. )o (e more specific, this *ourt is as0ed to determine who, as (etween two (uyers of unre istered land, is the ri htful owner>the first (uyer in a prior sale that was unrecorded, or the second (uyer who purchased the land in an e3ecution sale whose transfer was re istered in the "e ister of ;eeds.

)he facts as found (y the *ourt of Appeals are as followsC 8n April 1=, 197,, defendant spouses 1nri'ue *astro and Berminia ". *astro sold to plaintiff$appellee 7anuelito Palileo %private respondent herein&, a parcel of unre istered coconut land situated in *andiis, 7ansayaw, 7ainit, !uri ao del +orte. )he sale is evidenced (y a notari#ed ;eed of A(solute !ale %13h. <1<&. )he deed was not re istered in the "e istry of Property for unre istered lands in the province of !uri ao del +orte. !ince the e3ecution of the deed of sale, appellee 7anuelito Palileo who was then employed at @ian a !uri ao del !ur, e3ercised acts of ownership over the land throu h his mother "afaela Palileo, as administratri3 or overseer. Appellee has continuously paid the real estate ta3es on said land from 1971 until the present %13hs. <*< to <*$7<, inclusive&.
8n +ovem(er 29, 197?, a .ud ment was rendered a ainst defendant 1nri'ue ). *astro, in *ivil *ase +o. ,1,=1-5 (y the then *ourt of 9irst 2nstance of 7anila, /ranch J2J, to pay herein defendant$appellant "adiowealth 9inance *ompany %petitioner herein&, the sum of P22,=5,.=5 with interest thereon at the rate of 1?S per annum from +ovem(er 2, 1975 until fully paid, and the further sum of P2,2=5.,= as attorney5s fees, and to pay the costs. 4pon the finality of the .ud ment, a writ of e3ecution was issued. Pursuant to said writ, defendant provincial !heriff 7arietta 1. 1viota, throu h defendant ;eputy Provincial !heriff @eopoldo "isma, levied upon and finally sold at pu(lic auction the su(.ect land that defendant 1nri'ue *astro had sold to appellee 7anuelito Palileo on April 1=,197,. A certificate of sale was e3ecuted (y the Provincial !heriff in favor of defendant$ appellant "adiowealth 9inance *ompany, (ein the only (idder. After the period of redemption has %sic& e3pired, a deed of final sale was also e3ecuted (y the same Provincial !heriff. /oth the certificate of sale and the deed of final sale were re istered with the "e istry of ;eeds. :

@earnin of what happened to the land, private respondent 7anuelito Palileo filed an action for 'uietin of title over the same. After a trial on the merits, the court a quo rendered a decision in his favor. 8n appeal, the decision of the trial court was affirmed. Bence, this petition for review on certiorari. 2n its petition, "adiowealth 9inance *ompany presents the followin errorsC 1. )B1 *84") 89 APP1A@! 1""1; 2+ +8) 92+;2+: )BA) )B1 ;11; 89 A/!8@4)1 !A@1 %1JB2/2) /& A@@1:1;@G 1J1*4)1; /G 1+"2H41 *A!)"8 2+ 9AV8" 89 APP1@@11 7A+41@2)8 PA@2@18, DA! !274@A)1; 8" 92*)2)284!. 2. )B1 *84") 89 APP1A@! 1""1; 2+ +8) 92+;2+: APP1@@11 7A+41@2)8 PA@2@18 A! A;72+2!)"A)8" 8+@G 89 )B1 ;2!P4)1; P"8P1")G6 A+;
=. )B1 *84") 89 APP1A@! 1""1; 2+ +8) 92+;2+: ;191+;A+)$APP1@@A+) "A;28D1A@)B 92+A+*1 *87PA+G 8D+1" 89 )B1 ;2!P4)1; P"8P1")G /G "1A!8+ 89 )B1 *1")292*A)1 89 !A@1 A+; )B1 ;11; 89 92+A@ !A@1 DB2*B D1"1 A@@ "1:2!)1"1; 2+ )B1 "1:2!)1" 89 ;11;!, B1+*1, !4P1"28" )8 )BA) 89 )B1 ;11; 89 !A@1 2+ P8!!1!!28+ 89 7A+41@2)8 PA@2@18, 98" /12+: +8) "1:2!)1"1;. 4

As re ards the first and second assi ned errors, suffice it to state that findin s of fact of the *ourt of Appeals are conclusive on this *ourt and will not (e distur(ed unless there is rave a(use of discretion. )he findin of the *ourt of Appeals that the property in 'uestion was already sold to

private respondent (y its previous owner (efore the e3ecution sale is evidenced (y a deed of sale. !aid deed of sale is notari#ed and is presumed authentic. )here is no su(stantive proof to support petitioner5s alle ation that the document is fictitious or simulated. Dith this in mind, De see no reason to re.ect the conclusion of the *ourt of Appeals that private respondent was not a mere administrator of the property. )hat he e3ercised acts of ownership throu h his mother also remains undisputed. :oin now to the third assi ned error which deals with the main issue presented in the instant petition, De o(serve that the *ourt of Appeals resolved the same in favor of private respondent due to the followin reason6 what the Provincial !heriff levied upon and sold to petitioner is a parcel of land that does not (elon to 1nri'ue *astro, the .ud ment de(tor, hence the e3ecution is contrary to the directive contained in the writ of e3ecution which commanded that the lands and (uildin s be onging to *nrique 0astro (e sold to satisfy the e3ecution. ; )here is no dou(t that had the property in 'uestion (een a re istered land, this case would have (een decided in favor of petitioner since it was petitioner that had its claim first recorded in the "e istry of ;eeds. 9or, as already mentioned earlier, it is the act of re istration that operates to convey and affect re istered land. )herefore, a bona fide purchaser of a re istered land at an e3ecution sale ac'uires a ood title as a ainst a prior transferee, if such transfer was unrecorded. Bowever, it must (e stressed that this case deals with a parcel of unre istered land and a different set of rules applies. De affirm the decision of the *ourt of Appeals. 4nder Act +o. ==--, re istration of instruments affectin unre istered lands is <without pre.udice to a third party with a (etter ri ht<. )he afore'uoted phrase has (een held (y this *ourt to mean that the mere re istration of a sale in one5s favor does not ive him any ri ht over the land if the vendor was not anymore the owner of the land havin previously sold the same to some(ody else even if the earlier sale was unrecorded. )he case of 0arumba vs. 0ourt of +ppea s 6 is a case in point. 2t was held therein that Article 15-- of the *ivil *ode has no application to land not re istered under Act +o. -9?. @i0e in the case at (ar, *arum(a dealt with a dou(le sale of the same unre istered land. )he first sale was made (y the ori inal owners and was unrecorded while the second was an e3ecution sale that resulted from a complaint for a sum of money filed a ainst the said ori inal owners. Applyin !ection =5, "ule =9 of the "evised "ules of *ourt, 7 this *ourt held that Article 15-- of the *ivil *ode cannot (e invo0ed to (enefit the purchaser at the e3ecution sale thou h the latter was a (uyer in ood faith and even if this second sale was re istered. 2t was e3plained that this is (ecause the purchaser of unre istered land at a sheriffs e3ecution sale only steps into the shoes of the .ud ment de(tor, and merely ac'uires the latter5s interest in the property sold as of the time the property was levied upon. Applyin this principle, the *ourt of Appeals correctly held that the e3ecution sale of the unre istered land in favor of petitioner is of no effect (ecause the land no lon er (elon ed to the .ud ment de(tor as of the time of the said e3ecution sale. DB1"198"1, in view of the fore oin , the decision of the *ourt of Appeals in *A$:.". *V +o. 1,7AA is here(y A992"71;. +o costs. !8 8";1"1;.

BG.R. No. 1544<2. January 22, 1996C

BELIN7A TARE7O, $or -%r.%($ an" ,n r%*r%.%n&a&,on o$ -%r 'ro&-%r. an" .,.&%r., an" TEOFILA COR UE TANE7O, r%*r%.%n&,n2 -%r /,nor "au2-&%r FERNA TANE7O, etitioners, -s. THE COURT OF A EALS, S OUSES RICAR7O !. TARE7O AN7 TERESITA BARERA TARE7O,res ondents.
7ECISION
ANGANIBAN, J.:

2s a sale of future inheritance validK 2n multiple sales of the same real property, who has preference in ownershipK Dhat is the pro(ative value of the lower courtNs findin of ood faith in re istration of such sales in the re istry of propertyK )hese are the main 'uestions raised in this Petition for review on certiorari under "ule -5 of the "ules of *ourt to set aside and reverse the ;ecision1 of the *ourt of Appeals2 in *A$:.". *V +8. 2-9A7 promul ated on !eptem(er 2?, 1991 affirmin the decision of the "e ional )rial *ourt, /ranch ?=, )hird Judicial "e ion, )arlac, )arlac in *ivil *ase +o. ?=2A, and its "esolution denyin reconsideration thereof, promul ated on 7ay 27, 1992. /y the *ourtNs "esolution on 8cto(er 25, 1995, this case %alon with several others& was transferred from the 9irst to the )hird ;ivision and after due deli(eration, the *ourt assi ned it to the undersi ned ponen e for the writin of this ;ecision. T-% Fa0&.

8n 8cto(er 2,, 19?2, @a#ardo )aTedo e3ecuted a notari#ed deed of a(solute sale in favor of his eldest (rother, "icardo )aTedo, and the latterNs wife, )eresita /arera, private respondents herein, where(y he conveyed to the latter in consideration of P1,5,,.,,, Qone hectare of whatever share 2 shall have over @ot +o. 191 of the cadastral survey of :erona, Province of )arlac and covered (y )itle )$l=A29 of the "e ister of ;eeds of )arlac,R the said property (ein his Qfuture inheritanceR from his parents %13h. 1&. 4pon the death of his father 7atias, @a#aro e3ecuted an QAffidavit of *onformityR dated 9e(ruary 2A, 19A, %13h. =& to Qre$affirm, respect. ac0nowled e and validate the sale 2 made in 19?2.R 8n January 1=, 19A1, @a#aro e3ecuted another notari#ed deed of sale in favor of private respondents coverin his Qundivided 8+1 )D1@V1 %1M12& of a parcel of land 0nown as @ot 191 3 3 %13h. -&. Be ac0nowled ed therein his receipt of P 1,,,,,.,, as consideration therefor. 2n 9e(ruary 19A1, "icardo learned that @a#aro sold the same property to his children, petitioners herein, throu h a deed of sale dated ;ecem(er 29, 19A, %13h. 1&. 8n June 7, 19A2, private respondents recorded the ;eed of !ale %13h. -& in their favor in the "e istry of ;eeds and the correspondin entry was made in )ransfer *ertificate of )itle +o. 1??-51 %13h. 53. Petitioners on July 1?, 19A2 filed a complaint for rescission %plus dama es& of the deeds of sale e3ecuted (y @a#aro in favor of private respondents coverin the property inherited (y @a#aro from his father. Petitioners claimed that their father, @a#aro, e3ecuted an QA(solute ;eed of !aleR dated ;ecem(er 29, 19A, %13it. 1&, conveyin to his ten children his allotted portion under the e3tra.udicial partition e3ecuted (y the heirs of 7atias, which deed included the land in liti ation %@ot 191&. Petitioners also presented in evidenceC %1& a private writin purportedly prepared and si ned (y 7atias dated ;ecem(er 2A, 197A, statin that it was his desire that whatever inheritance @a#aro would receive from him should (e iven to his %@a#aroNs& children %13h. A&6 %2& a typewritten document dated 7arch 1,, 1979 si ned (y @a#aro in the presence of two witnesses, wherein he confirmed that he would voluntarily a(ide (y the wishes of his father, 7atias, to ive to his %@a#aroNs& children all the property he would inherit from the latter %13h. /&6 and %=& a letter dated January 1, 19A, of @a#aro to his dau hter, *armela, statin that his share in the e3tra.udicial settlement of the estate of his father was intended for his children, petitioners herein %13h. *&. Private respondents, however presented in evidence a Q;eed of "evocation of a ;eed of !aleR dated 7arch 12, 19A1 %13h. ?&, wherein @a#aro

revo0ed the sale in favor of petitioners for the reason that it was Qsimulated or fictitious $ without any consideration whatsoever.R !hortly after the case a quo was filed, @a#aro e3ecuted a sworn statement %13h. :& which virtually repudiated the contents of the ;eed of "evocation of a ;eed of !ale %13h. ?& and the ;eed of !ale %13h. -& in favor of private respondents. Bowever, @a#aro testified that he sold the property to "icardo, and that it was a lawyer who induced him to e3ecute a deed of sale in favor of his children after ivin him five pesos %P5.,,& to (uy a Qdrin0R %)!+ !eptem(er 1A, 19A5, pp. 2,-$2,5&. )he trial court decided in favor of private respondents, holdin that petitioners failed Qto adduce a preponderance of evidence to support %their& claim.R 8n appeal, the *ourt of Appeals affirmed the decision of the trial court, rulin that the ;eed of !ale dated January 1=, 19A1 %13h. 9& was valid and that its re istration in ood faith vested title in said respondents. T-% I..u%. Petitioners raised the followin QerrorsR in the respondent *ourt, which they also now alle e in the instant PetitionC H#, 2he trial ourt erred in on luding that the 4ontra t of %ale of O to&er /+, 017/ IE"hi&it 8, !nswerJ is merely voida&le or annula&le and not void ab initio pursuant to paragraph / of !rti le 0*<8 of the New 4ivil 4ode involving as it does a Kfuture inheritan eB, H##, 2he trial ourt erred in holding that defendants5appellees a ted in good faith in registering the deed of sale of .anuary 0*, 01?0 IE"hi&it 1J with the Register of $eeds of 2arla and therefore ownership of the land in 'uestion passed on to defendants5 appellees, H###, 2he trial ourt erred in ignoring and failing to onsider the testimonial and do umentary eviden e of plaintiffs5appellants whi h learly esta&lished &y preponderan e of eviden e that they are indeed the legitimate and lawful owners of the property in 'uestion, H#F, 2he de ision is ontrary to law and the fa ts of the ase and the on lusions drawn from the esta&lished fa ts are illogi al and off5tangent,L 9rom the fore oin , the issues may (e restated as followsC

1. 2s the sale of a future inheritance validK 2. Das the su(se'uent e3ecution on January 1=, 19A1 %and re istration with the "e istry of Property& of a deed of sale coverin the same property to the same (uyers validK =. 7ay this *ourt review the findin s of the respondent *ourt %a& holdin that the (uyers acted in ood faith in re isterin the said su(se'uent deed of sale and %(& in Qfailin to consider petitionersN evidenceRK Are the conclusions of the respondent *ourt Qillo ical and off$tan entRK

T-% Cour&N. Ru(,n2 At the outset, let it (e clear that the QerrorsR which are reviewa(le (y this *ourt in this petition for review on certiorari are only those alle edly committed (y the respondent *ourt of Appeals and not directly those of the trial court, which is not a party here. )he Qassi nment of errorsR in the petition 'uoted a(ove are therefore totally misplaced, and for that reason, the petition should (e dismissed. /ut in order to ive the parties su(stantial .ustice we have decided to delve into the issues as a(ove re$stated. )he errors attri(uted (y petitioners to the latter %trial& court will (e discussed only insofar as they are relevant to the appellate courtNs assailed ;ecision and "esolution. )he sale made in 19?2 involvin future inheritance is not really at issue here. 2n conte3t, the assailed ;ecision conceded Qit may (e le ally correct that a contract of sale of anticipated future inheritance is null and void.R= /ut to remove all dou(ts, we here(y cate orically rule that, pursuant to Article 1=-7 of the *ivil *ode, Q%n&o contract may (e entered into upon a future inheritance e3cept in cases e3pressly authori#ed (y law.R *onse'uently, said contract made in 19?2 is not valid and cannot (e the source of any ri ht nor the creator of any o(li ation (etween the parties. Bence, the Qaffidavit of conformityR dated 9e(ruary 2A, 19A,, insofar as it sou ht to validate or ratify the 19?2 sale, is also useless and, in the words of the respondent *ourt, Qsuffers from the same infirmity.R 1ven private respondents in their memorandum- concede this. Bowever, the documents that are critical to the resolution of this case areC %a& the deed of sale of January 1=, 19A1 in favor of private respondents coverin @a#aroNs undivided inheritance of one$twelfth %1M12& share in @ot +o. 191, which was su(se'uently re istered on June 7, 19A26 and %(& the deed of sale dated ;ecem(er 29, 19A, in favor of petitioners coverin the same property. )hese two documents were e3ecuted after the death of 7atias %and

his spouse& and after a deed of e3tra.udicial settlement of his %7atiasN& estate was e3ecuted, thus vestin in @a#aro actual title over said property. 2n other words, these dispositions, thou h conflictin , were no lon er infected with the infirmities of the 19?2 sale. Petitioners contend that what was sold on January 1=, 19A1 was only one$ half hectare out of @ot +o. 191, citin as authority the trial courtNs decision. As earlier pointed out, what is on review in these proceedin s (y this *ourt is the *ourt of AppealsN decision $ which correctly identified the su(.ect matter of the January 1=, 19A1 sale to (e the entire undivided 1M12 share of @a#aro in @ot +o. 191 and which is the same property disposed of on ;ecem(er 29, 19A, in favor of petitioners. *ritical in determinin which of these two deeds should (e iven effect is the re istration of the sale in favor of private respondents with the re ister of deeds on June 7, 19A2. Article 15-- of the *ivil *ode overns the preferential ri hts of vendees in cases of multiple sales, as followsC H!rt, 0)<<, #f the same thing should have &een sold to different vendees, the ownership shall &e transferred to the person who may have first ta=en possession thereof in good faith, if it should &e mova&le property, %hould it &e immova&le property, the ownership shall &elong to the person a 'uiring it who in good faith first re orded it in the Registry of Property, %hould there &e no ins ription, the ownership shall pertain to the person who in good faith was first in the possession- and, in the a&sen e thereof, to the person who presents the oldest title, provided there is good faith,L )he property in 'uestion is land, an immova(le, and followin the a(ove$ 'uoted law, ownership shall (elon to the (uyer who in ood faith re isters it first in the re istry of property. )hus, althou h the deed of sale in favor of private respondents was later than the one in favor of petitioners, ownership would vest in the former (ecause of the undisputed fact of re istration. 8n the other hand, petitioners have not re istered the sale to them at all. Petitioners contend that they were in possession of the property and that private respondents never too0 possession thereof. As (etween two purchasers, the one who re istered the sale in his favor has a preferred ri ht over the other who has not re istered his title, even if the latter is in actual possession of the immova(le property.5

As to third issue, while petitioners conceded the fact of re istration, they nevertheless contended that it was done in (ad faith. 8n this issue, the respondent *ourt ruledC H3nder the se ond assignment of error, plaintiffs5appellants ontend that defendants5 appellees a ted in &ad faith when they registered the $eed of %ale in their favor as appellee Ri ardo already =new of the e"e ution of the deed of sale in favor of the plaintiffs- appellants ite the testimony of plaintiff 9elinda 2afledo to the effe t that defendant Ri ardo 2aMedo alled her up on .anuary < or 5, 01?0 to tell her that he was already the owner of the land in 'uestion K&ut the ontra t of sale &etween our father and us were Isi J already onsumatedB Ipp, 150+, tsn, .anuary 7, 01?<J, 2his testimony is o&viously self5serving, and &e ause it was a telephone onversation, the deed of sale dated $e em&er /1, 01?+ was not shown- 9elinda merely told her un le that there was already a do ument showing that plaintiffs are the owners Ip, ?+J, Ri ardo 2aMedo ontroverted this and testified that he learned for the first time of the deed of sale e"e uted &y Da;aro in favor of his hildren Ka&out a month or sometime in Fe&ruary 01?0B Ip, 000, tsn, Nov, /?, 01?<J, " " "L7 )he respondent *ourt, reviewin the trial courtNs findin s, refused to overturn the latterNs assessment of the testimonial evidence, as followsC HWe are not prepared to set aside the finding of the lower ourt upholding Ri ardo 2anedoBs testimony, as it involves a matter of redi&ility of witnesses whi h the trial (udge, who presided at the hearing, was in a &etter position to resolve,L I4ourt of !ppealsB $e ision, p, 7,J 2n this connection, we note the tenacious alle ations made (y petitioners, (oth in their (asic petition and in their memorandum, as followsC
1. )he respondent *ourt alle edly i nored the claimed fact that respondent "icardo Q(y fraud and deceit and with fore0nowled eR that the property in 'uestion had already (een sold to petitioners, made @a#aro e3ecute the deed of January 1=, 19A16 2. )here is alle edly ade'uate evidence to show that only 1M2 of the purchase price of P1,,,,,.,, was paid at the time of the e3ecution of the deed of sale, contrary to the written ac0nowled ment, thus showin (ad faith6 =. )here is alle edly sufficient evidence showin that the deed of revocation of the sale in favor of petitioners Qwas tainted with fraud or deceit.R -. )here is alle edly enou h evidence to show that private respondents Qtoo0 undue advanta e over the wea0ness and unschooled and pitiful situation of @a#aro )afledo . . .R and that respondent "icardo )aTedo Qe3ercised moral ascendancy over his youn er (rother he (ein the eldest (rother and who reached fourth year colle e of law and at one time a former Vice$:overnor of )arlac, while his youn er (rother only attained first year hi h school 3 3 3 Q6

5. )he respondent *ourt erred in not ivin credence to petitionersN evidence, especially @a#aro )aTedoNs !inumpaang !a aysay dated July 27, 19A2 statin that "icardo )aTedo deceived the former in e3ecutin the deed of sale in favor of private respondents.

)o (e sure, there are indeed many conflictin documents and testimonies as well as ar uments over their pro(ative value and si nificance. !uffice it to say, however, that all the a(ove contentions involve 'uestions of fact, appreciation of evidence and credi(ility of witnesses, which are not proper in this review. 2t is well$settled that the !upreme *ourt is not a trier of facts. 2n petitions for review under "ule -5 of the "evised "ules of *ourt, only 'uestions of law may (e raised and passed upon. A(sent any whimsical or capricious e3ercise of .ud ment, and unless the lac0 of any (asis for the conclusions made (y the lower courts (e amply demonstrated, the !upreme *ourt will not distur( their findin s. At most, it appears that petitioners have shown that their evidence was not (elieved (y (oth the trial and the appellate courts, and that the said courts tended to ive more credence to the evidence presented (y private respondents. /ut this in itself is not a reason for settin aside such findin s. De are far from convinced that (oth courts ravely a(used their respective authorities and .udicial prero atives. As held in the recent case of 0hua 4iong 4ay vs. 0ourt of +ppea s and 'oidrock 0onstruction and 5eve opment 0orp.67 H2he 4ourt has onsistently held that the fa tual findings of the trial ourt, as well as the 4ourt of !ppeals, are final and on lusive and may not &e reviewed on appeal, !mong the e" eptional ir umstan es where a reassessment of fa ts found &y the lower ourts is allowed are when the on lusion is a finding grounded entirely on spe ulation, surmises or on(e tures- when the inferen e made is manifestly a&surd, mista=en or #mpossi&le- when there is grave a&use of dis retion in the appre iation of fa ts- when the (udgment is premised on a misapprehension of fa ts- when the findings went &eyond the issues of the ase and the same are ontrary to the admissions of &oth appellant and appellee, !fter a areful study of the ase at &en h, we find none of the a&ove grounds present to (ustify the re5evaluation of the findings of fa t made &y the ourts &elow,L 2n the same vein, the rulin in the recent case of !outh !ea !urety and (nsurance 0ompany, (nc. vs. 8on. 0ourt of +ppea s, et a .EAF is e'ually applica(le to the present caseC HWe see no valid reason to dis ard the fa tual on lusions of the appellate ourt, " " " I#Jt is not the fun tion of this 4ourt to assess and evaluate all over again the eviden e, testimonial and do umentary, addu ed &y the parties, parti ularly where, su h as

here, the findings of both the trial court and the appellate court on the matter coincide. Iitali s suppliedJ LHEREFORE, the petition is 7ENIE7 and the assailed ;ecision of the *ourt of Appeals is AFFIR!E7. +o *osts. SO OR7ERE7.

BG.R. No. 1;697:. Jun% 4, 2554C

S OUSES TO!AS OCCEOA an" SILFINA OCCEOA, etitioners, -s. LD7IA !ORALES OBSIANA ES ONILLA, ELSA !ORALES OBSIANA SALAEAR an" 7ARFROSA OBSIANA SALAEAR ES ONILLA, res ondents. 7ECISION
UNO, J.G

)he case at (ar involves a portion of the 1,19A$s'uare meter residential lot %lot no. 2?5& situated in !i(alom, Anti'ue, ori inally owned (y spouses +icolas and 2rene )ordesillas under 8*) +o. 11=,. )he )ordesillas spouses had three %=& children, namelyC Barod, An ela and "osario, the latter havin (een survived (y her two %2& children, Arnold and @ilia de la 9lor. After the death of the )ordesillas spouses, the lot was inherited (y their children Barod and An ela, and randchildren Arnold and @ilia. 2n 1951, the heirs e3ecuted a 7%%" o$ Pacto de "etroSa(% ,n $a3or o$ A('%r&a !ora(%. 0o3%r,n2 &-% .ou&-+%.&%rn *or&,on o$ &-% (o& +,&- an ar%a o$ 74< .6uar% /%&%r..
E1F

)hree %=& years later, in 19;4, Arnold and @ilia e3ecuted a 7%%" o$ 7%$,n,&% Sa(% o$ S-ar%., R,2-&., In&%r%.&. an" ar&,0,*a&,on. o3%r &-% .a/% 74< .6. /. (o& ,n $a3or o$ A('%r&a!ora(%.. )he notari#ed deed also attested that the lot sold (y vendors Arnold and @ilia to Al(erta were their share in the estate of their deceased parents.
E2F

A('%r&a *o..%..%" &-% (o& a. o+n%r, 0on.&ru0&%" a -ou.% on ,& an" a**o,n&%" a 0ar%&a)%r &o o3%r.%% -%r *ro*%r&y. )hereafter, in July 195?, vendor Arnold de la 9lor (orrowed the 8*) from Al(erta coverin the lot. Be e3ecuted an Affidavit ac0nowled in receipt of the 8*) in trust and undertoo0 to return said title free from chan es, modifications or cancellations.
E=F

2n 19??, Arnold and An ela, nephew and dau hter respectively of the )ordesillas spouses, without the 0nowled e of Al(erta, e3ecuted a 7%%" o$ E1&ra>u",0,a( S%&&(%/%n& "%0(ar,n2 &-% &+o o$ &-%/ a. &-% on(y 0oo+n%r. o$ &-% un",3,"%" 1,19< .6. /. (o& no. 26;, +,&-ou& a0)no+(%"2,n2 &-%,r *r%3,ou. .a(% o$ 74< .6. /. &-%r%o$ &o A('%r&a. A num(er of times, thereafter, Al(erta and her nieces as0ed Arnold for the 8*) of the land (ut Arnold .ust 0ept on promisin to return it.
E-F

2n 19A=, Arnold e3ecuted an A$$,"a3,& o$ S%&&(%/%n& o$ &-% E.&a&% of An ela who died in 197A without issue, declarin himself as the sole heir of An ela and thus consolidatin the title of the entire lot in his name.
E5F

2n 19A5, vendee A('%r&a !ora(%. ",%". H%r n,%0%.--%,r., @ydia, 1lsa and ;afrosa, .u00%%"%" ,n &-% o+n%r.-,* o$ &-% (o&. 7onths later, as the heirs were a(out to leave for the 4nited !tates, they as0ed Arnold to deliver to them the title to the land so they can re ister it in their name. Arnold repeatedly promised to do so (ut failed to deliver the title to them. 8n ;ecem(er -, 19A?, after Al(ertaNs heirs left for the !tates, Arnold used the 8*) he (orrowed from the deceased vendee Al(erta 7orales, .u'",3,"%" &-% %n&,r% (o& no. 26; ,n&o &-r%% .u'(o&., an" r%2,.&%r%" &-%/ a(( un"%r -,. na/%, vi.C lot no. 2?5$A %with )*) +o. 1?A95&, lot no. 2?5$/ %with )*) +o. 1?A9?& and lot no. 2?5$* %with )*) +o. 1?A97&. Be then paid the real estate ta3es on the property. 8n Au ust 1=, 199,, Arnold sold lot nos. 2?5$/ L * to spouses )omas and !ylvina 8cceTa, which included the 7-A s'. m. portion previously sold to Al(erta 7orales. A ;eed of A(solute !ale over said lots was e3ecuted to the 8cceTa spouses and titles were transferred to their names.
E?F

2n 199=, after the death of Arnold, the three %=& nieces$heirs of Al(erta 7orales learned a(out the second sale of their lot to the 8cceTa spouses when they were notified (y careta0er A(as that they were (ein e.ected from the land. 2n 199-, the heirs filed a case for annulment of sale and cancellation of titles, with dama es, a ainst the second vendees 8cceTa spouses. 2n their complaint, they alle ed that the 8cceTas purchased the land in (ad faith as they were aware that the lots sold to them had already
E7F

(een sold to Al(erta 7orales in 195-. )hey averred that (efore the sale, when )omas 8cceTa conducted an ocular inspection of the lots, 7orito A(as, the careta0er appointed (y Al(erta 7orales to oversee her property, warned them not to push throu h with the sale as the land was no lon er owned (y vendor Arnold as the latter had previously sold the lot to Al(erta 7orales who had a house constructed thereon. 9or their part, the 8cceTa spouses claimed that the 8*) in the name of the ori inal owners of the lots, the )ordesillas spouses, was cancelled after it was su(divided (etween An ela and Arnold in 19?96 that new )*)s had (een issued in the latterNs names6 that they were unaware that the su(.ect lots were already previously sold to 7orales as they denied that )omas had a tal0 with careta0er A(as on the matter6 that as of ;ecem(er -, 19A7, the )*)s coverin the lots were in the name of Arnold and his wife, without any adverse claim annotated thereon6 that vendor Arnold represented to them that the occupants they saw on the land were s'uatters and that he merely tolerated their presence6 that &-%y "," no& *%r.ona((y ,n3%.&,2a&% &-% a((%2%" .6ua&&%r. on &-% (an" an" /%r%(y r%(,%" on &-% r%*r%.%n&a&,on o$ 3%n"or Arno("I that sometime in 19??$19?7, Arnold and his co$heir An ela caused the survey of the ori inal lot and su(divided it into = lots, without opposition from 7orales or her heirs. )hus, three %=& )*)s were issued in 19?9 to Arnold and An ela and, two of the lots were then sold to the 8cceTa spouses, a ain without o(.ection from Al(erta 7orales. )he 8cceTa spouses alle ed that they were (uyers in ood faith as the titles to the su(.ect lots were free from liens or encum(rances when they purchased them. )hey claimed that in 19A9,Arnold offered to sell the su(.ect lots to them. 8n Au ust 1=, 199,, after they verified with the Anti'ue "e istry of ;eeds that ArnoldNs )*)s were clean and unencum(ered, Arnold si ned the instrument of sale over the su(.ect lots in favor of the 8cceTas for P1,,,,,,.,, and new titles were issued in their names. )he 8cceTas li0ewise set up the defenses of laches and prescription. )hey ar ue that Al(erta and plaintiffs$heirs were (arred from prosecutin their action as they failed to assert their ri ht for forty %-,& years. 9irstly, they point out that vendor Arnold and An ela su(divided the entire lot in 19?? and declared themselves as the only co$owners thereof in the deed of e3tra.udicial settlement. Al(erta 7orales failed to oppose the inclusion of her 7-A s'. m. lot in the deed. )hus, the title to the entire lot no. 25? was transferred to the names of Arnold and An ela. !econdly, preparatory to the division of the lots, vendor Arnold had the land surveyed (ut Al(erta a ain failed to oppose the same. 9inally, Al(erta and her heirs who are claimin adverse ri hts over the land (ased on the 1951 ;eed of

Pacto de "etro !ale and the 195- ;eed of ;efinite !ale of !hares failed for -, years to annotate their adverse claims on the new titles issued to Arnold and An ela, ena(lin the latter to possess a clean title and transfer them to the 8cceTa spouses. After trial, the lower court rendered a decision declarin the 8cceTa spouses as (uyers in ood faith and ruled that the action of the heirs was time$(arred. 8n appeal (y Al(ertaNs heirs, the *ourt of Appeals reversed the decision of the trial court. 2t found that the 8cceTas purchased the land in (ad faith and that the action filed (y Al(ertaNs heirs was not (arred (y prescription or laches. )he dispositive portion readsC WHEREFORE, the instant appeal is here&y GRANTED, ! ordingly, the assailed de ision is here&y REVERSED and SET ASIDE and a new one is rendered de laring the $eed of !&solute %ale dated !ugust 0*, 011+ e"e uted &etween !rnold de la Flor in favor of defendants5appellees null and void and ordering the an ellation of 2ransfer 4ertifi ate of 2itle Nos, 07?17, 07?18, 250?/<0 and 250?/</, SO ORDERED.
EAF

Bence this appeal where petitioner$spouses 8cceTa raise the followin issuesC
I

WHETHER OR NOT A VERBAL INFORMATION COULD BE MADE TO PREVAIL OVER A CLEAN CERTIFICATE OF TITLE OF A REGISTERED LAND WHICH IS FREE OF AN LIEN OR ENCUMBRANCE ANNOTATED ON ITS CERTIFICATE OF TITLE OR AN ADVERSE CLAIM RECORDED WITH THE REGISTER OF DEEDS.
II

WHETHER OR NOT A BU ER OF A REGISTERED LAND IS OBLIGATED TO MA!E IN"UIRIES OF AN POSSIBLE DEFECT OR ADVERSE CLAIM AFFECTING ITS OWNERSHIP WHICH DOES NOT APPEAR ON THE CERTIFICATE OF TITLE.
III

WHETHER OR NOT THE PERIOD OF MORE THAN FORT #$%& EARS WITHOUT POSITIVE ACTION TA!EN B RESPONDENTS, AS WELL AS

B ALBERTA MORALES, TO PROTECT THEIR INTEREST CAN BE CONSIDERED LACHES AND THUS THEIR PRESENT ACTION HAS PRESCRIBED. 8n the $,r.& &+o ,..u%., petitioner$spouses claim that they were purchasers of the land in ood faith as the law does not o(li ate them to o (eyond a clean certificate of title to determine the condition of the property. )hey ar ue that a person dealin with re istered land is only char ed with notice of the (urden on the property annotated on the title. Dhen there is nothin on the title to indicate any cloud or vice in the ownership of the property or any encum(rance thereon, the purchaser is not re'uired to e3plore further than the title in 'uest of any hidden defect or inchoate ri ht that may su(se'uently defeat his ri ht thereto. )hey claim they had every ri ht to purchase the land despite the ver(al warnin made (y careta0er A(as as the information was mere hearsay and cannot prevail over the title of the land which was free from any encum(rance. )heir ar uments do not persuade. )he petition at (ar presents a case of dou(le sale of an immova(le property. Article 15-- of the +ew *ivil *ode provides that in case an immova(le property is sold to different vendees, the ownership shall (elon C %1& to the person ac'uirin it +-o ,n 2oo" $a,&- $,r.& r%0or"%" ,& in the "e istry of Property6 %2& should there (e no inscription, the ownership shall pertain to &-% *%r.on +-o ,n 2oo" $a,&- +a. $,r.& ,n *o..%..,onI and, %=& in the a(sence thereof, to the person who presents the oldest title, provided there is ood faith. 2n all cases, ood faith is essential. 2t is the (asic premise of the preferential ri hts ranted to the one claimin ownership over an immova(le. Dhat is material is whether the second (uyer first re isters the second sale in ood faith, i.e., without 0nowled e of any defect in the title of the property sold. )he defense of indefeasi(ility of a )orrens title does not e3tend to a transferee who ta0es the certificate of title in (ad faith, with notice of a flaw.
E9F E1,F E11F

)he overnin principle of prius tempore, potior 9ure %first in time, stron er in ri ht& enunciated under Art. 15-- has (een clarified, thusC " " " Gnowledge &y the first &uyer of the se ond sale annot defeat the first &uyerBs rights e" ept when the se ond &uyer first registers in good faith the se ond sale (Olivares vs. Gonzales, 5! "C#A $$%. 4onversely,'(ow)e*+e +,i(e* -. the se/o(* -0.er o1 the 1irst s,)e *e1e,ts his ri+hts e2e( i1 he is 1irst to re+ister, si(/e s0/h '(ow)e*+e t,i(ts his re+istr,tio( with -,* 1,ith Isee also Astorga vs. Court of Appeals, G.#. &o. 5'5$(, )* +ecember !',%. #n Cruz vs. Caba-a I6,R, No,

)7/*/, // .une 01?<, 0/1 %4R! 7)7J, it was held that it is esse(ti,), to 3erit the 4rote/tio( o1 Art. 56$$, se/o(* 4,r,+r,4h, th,t the se/o(* re,)t. -0.er 30st ,/t i( +oo* 1,ith i( re+isteri(+ his *ee* o1 s,)e I iting Carbonell vs. Court of Appeals, 71 %4R! 11 and Crisostomo vs. CA, 6,R, No, 1)?<*, +/ %eptem&er 011/J,

E12F

2n the case at (ar, we find that petitioner$spouses failed to prove ood faith in their purchase and re istration of the land. A *ur0-a.%r ,n 2oo" $a,&an" $or 3a(u% is one who (uys property without notice that some other person has a ri ht to or interest in such property and pays its fair price (efore he has notice of the adverse claims and interest of another person in the same property. !o it is that the Qhonesty of intentionR which constitutes ood faith implies a $r%%"o/ $ro/ )no+(%"2% o$ 0,r0u/.&an0%. +-,0- ou2-& &o *u& a *%r.on on ,n6u,ry. At the trial, )omas 8cceTa admitted that he found houses (uilt on the land durin its ocular inspection prior to his purchase. Be relied on the representation of vendor Arnold that these houses were owned (y s'uatters and that he was merely toleratin their presence on the land. )omas should have verified from the occupants of the land the nature and authority of their possession instead of merely relyin on the representation of the vendor that they were s'uatters, havin seen for himself that the land was occupied (y persons other than the vendor who was not in possession of the land at that time. )he settled rule is that a 'uy%r o$ r%a( *ro*%r&y ,n &-% *o..%..,on o$ *%r.on. o&-%r &-an &-% .%((%r /u.& '% +ary an" .-ou(" ,n3%.&,2a&% &-% r,2-&. o$ &-o.% ,n *o..%..,on. L,&-ou& .u0- ,n6u,ry, &-% 'uy%r 0an -ar"(y '% r%2ar"%" a. a 'uy%r ,n 2oo" $a,&an" 0anno& -a3% any r,2-& o3%r &-% *ro*%r&y. A purchaser cannot simply close his eyes to facts which should put a reasona(le man on his uard and then claim that he acted in ood faith under the (elief that there was no defect in the title of his vendor. Bis mere refusal to (elieve that such defect e3ists or his willful closin of his eyes to the possi(ility of the e3istence of a defect in his vendorNs title will not ma0e him an innocent purchaser for value if it later develops that the title was in fact defective, and it appears that he would have notice of the defect had he acted with that measure of precaution which may reasona(ly (e re'uired of a prudent man in a similar situation.
E1=F E1-F

2ndeed, the eneral rule is that one who deals with property re istered under the )orrens system need not o (eyond the same, (ut only has to rely on the title. Be is char ed with notice only of such (urdens and claims as are annotated on the title. Bowever, this principle does not apply when the party has actual 0nowled e of facts and circumstances that would impel a reasona(ly cautious man to ma0e such in'uiry or when the purchaser has 0nowled e of a defect or the lac0 of title in his vendor or of sufficient facts to induce a reasona(ly prudent man to in'uire into the status of the title of the

property in liti ation. 8ne who falls within the e3ception can neither (e denominated an innocent purchaser for value nor a purchaser in ood faith.
E15F

)he evidence of the private respondents show that when )omas 8cceTa conducted an ocular inspection of the land prior to the second sale, A(as, the careta0er of the house which Al(erta 7orales (uilt on the land, personally informed )omas that the lot had (een previously sold (y the same vendor Arnold to Al(erta 7orales. Dith this information, the 8cceTas were o(li ed to loo0 (eyond the title of their vendor and ma0e further in'uiries from the occupants of the land as to their authority and ri ht to possess it. Bowever, despite this information a(out a prior sale, the 8cceTas proceeded with the purchase in haste. )hey did not in'uire from A(as how they could et in touch with the heirs or representatives of Al(erta to verify the ownership of the land. +either do the records reveal that they e3erted effort to e3amine the documents pertainin to the first sale. Bavin discovered that the land they intended to (uy was occupied (y a person other than the vendor not in actual possession thereof, it was incum(ent upon the petitioners to verify the e3tent of the occupantNs possessory ri hts. )he 8cceTas did nothin and chose to i nore and dis(elieve A(asN statement.
E1?F

8n the &-,r" ,..u%, we hold that the action to annul title filed (y respondents$heirs is not (arred (y laches and prescription. F,r.&(y, laches is a creation of e'uity and its application is controlled (y e'uita(le considerations. @aches cannot (e used to defeat .ustice or perpetuate fraud and in.ustice. +either should its application (e used to prevent the ri htful owners of a property from recoverin what has (een fraudulently re istered in the name of another. S%0on"(y, prescription does not apply when the person see0in annulment of title or reconveyance is in possession of the lot (ecause the action parta0es of a suit to 'uiet title which is imprescripti(le. 2n this case, 7orales had actual possession of the land when she had a house (uilt thereon and had appointed a careta0er to oversee her property. Ber undistur(ed possession of the land for a period of fifty %5,& lon years ave her and her heirs a continuin ri ht to see0 the aid of a court of e'uity to determine the nature of the claim of ownership of petitioner$spouses. As held (y this *ourt in Fa>a 3.. Cour& o$ A**%a(.C
E17F E1AF E19F E2,F

" " " 2here is settled (urispruden e that o(e who is i( ,/t0,) 4ossessio( o1 , 4ie/e o1 ),(* /),i3i(+ to -e ow(er thereo1 3,. w,it 0(ti) his 4ossessio( is *ist0r-e* or his tit)e ,tt,/'e* -e1ore t,'i(+ ste4s to 2i(*i/,te his ri+ht, the re,so( 1or the r0)e -ei(+, th,t his 0(*ist0r-e* 4ossessio( +i2es hi3 , /o(ti(0i(+ ri+ht to see' the ,i* o1 , /o0rt o1 e70it. to ,s/ert,i( ,(* *eter3i(e the (,t0re o1 the ,*2erse /),i3 and its effe t on his own title, whi h right an &e laimed only &y one who is in

possession, " " " The ri+ht to 'uiet title to the property, see= its re onveyan e and ,((0) ,(. /erti1i/,te o1 tit)e /o2eri(+ it ,//r0e* o(). 1ro3 the ti3e the o(e i( 4ossessio( w,s 3,*e ,w,re o1 , /),i3 ,*2erse to his ow(, ,(* it is o(). the( th,t the st,t0tor. 4erio* o1 4res/ri4tio( /o33e(/es to r0( ,+,i(st s0/h 4ossessor. 2n the case at (ar, 7oralesN careta0er (ecame aware of the second sale to petitioner$spouses only in 1991 when he received from the latter a notice to vacate the land. "espondents$heirs did not sleep on their ri hts for in 199-, they filed their action to annul petitionersN title over the land. 2t li0ewise (ears to stress that when vendor Arnold reac'uired title to the su(.ect property (y means of fraud and concealment after he has sold it to Al(erta 7orales, a constructive trust was created in favor of 7orales and her heirs. As the defrauded parties who were in actual possession of the property, an action of the respondents$heirs to enforce the trust and recover the property cannot prescri(e. )hey may vindicate their ri ht over the property re ardless of the lapse of time. Bence, the rule that re istration of the property has the effect of constructive notice to the whole world cannot (e availed of (y petitioners and the defense of prescription cannot (e successfully raised a ainst respondents.
E21F

2n sum, the eneral rule is that re istration under the )orrens system is the operative act which ives validity to the transfer of title on the land. Bowever, it does not create or vest title especially where a party has actual 0nowled e of the claimantNs actual, open and notorious possession of the property at the time of his re istration. A (uyer in (ad faith has no ri ht over the land. As petitioner$spouses failed to re ister the su(.ect land in ood faith, ownership of the land pertains to respondent$heirs who first possessed it in ood faith.
E22F

IN FIEL LHEREOF, the petition is ;2!72!!1;. +o costs. SO OR7ERE7.

ABELAR7O CRUE @"%0%a.%"A .u'.&,&u&%" 'y H%,r. Con.u%(o C. Cru8, C(aro C. Cru8 an" S&%*-%n C. Cru8, *%r R%.o(u&,on, petitioners, vs. LEO7EGARIA CABANA, TEOFILO LEGAS I , ILU!INA7A CABANA an" THE HONOR- ABLE COURT OF A EALS,P respondents. :a.areno, +.ada, !abado ; 5i.on for petitioners. Fe i-berto :. <oquiren for respondents.

TEEHAN#EE, J.: )he *ourt affirms the 'uestioned decision of the now defunct *ourt of Appeals which affirmed that of the *ourt of 9irst 2nstance of Hue#on Province, (ut directs that the seller, respondent @eode aria *a(ana who sold the property in 'uestion twice, first to her co$respondents )eofilo @e aspi and 2luminada *a(ana and later to petitioner A(elardo *ru# %now deceased&, should reim(urse to petitioner5s heirs the amounts of P2,=52.5,, which the late petitioner A(elardo *ru# paid to the Philippine +ational /an0 to dischar e the mort a e o(li ation of said respondent @eode aria *a(ana in favor of said (an0, and of P=,=97.5,, representin the amount paid (y said A(elardo *ru# to her as consideration of the sale with pacto de retro of the su(.ect property. )his is a simple case of dou(le sale of real property. "espondent appellate court in its decision of Au ust 1=, 19A, stated the (ac0 round facts and resolved the issue in favor of defendants$ appellees, first (uyers$ respondents herein, and a ainst plaintiff$appellant A(elardo *ru#, petitioner herein %su(stituted (y his heirs&, as followsC ;efendants5 evidence shows that on 8cto(er 21, 19?A, defendant @eode aria *a(ana sold the land in 'uestion to defendants$spouses )eofilo @e aspi and 2luminada *a(ana %13h. 1&. )he said defendants$spouses attempted to re ister the deed of sale (ut said re istration was not accomplished (ecause they could not present the owner5s duplicate of title which was at that time in the possession of the P+/ as mort a e. @i0ewise, when plaintiff tried to re ister the deed of sale e3ecuted (y @eode aria *a(ana on !eptem(er =, 197,, said plaintiff was informed that the owner thereof had

sold the land to defendants$spouses on 8cto(er 21, 19?A. Plaintiff was a(le to re ister the land in his name on 9e(ruary 9, 1971 %13h. A&. Dith the admission of (oth parties that the land in 'uestion was sold to two persons, the main issue to (e resolved in this appeal is as to who of said vendees has a (etter title to said land. )here is no dispute that the land in 'uestion was sold with ri ht of repurchase on June 1, 19?5 to defendants$ spouses )eofilo @e aspi and 2luminada *a(ana %13h. 1&. )he said document 5/ilihan 7ulin 7a(i(ili5 stipulated that the land can (e repurchased (y the vendor within one year from ;ecem(er =1, 19?? %see par. 5, 13h. 1&. !aid land was not repurchased and in the meantime, however, said defendants$spouses too0 possession of the land.
wph =it>

4pon re'uest of @eode aria *a(ana, the title of the land was lent to her in order to mort a e the property to the Philippine +ational /an0. !aid title was, forthwith, deposited with the P+/. 8n 8cto(er 21, 19?A, defendant @eode aria *a(ana sold the land (y way of a(solute sale to the defendants$ spouses %13h. 2&. Bowever, on +ovem(er 29, 19?A defendant sold the same property to herein plaintiff and the latter was a(le to re ister it in his name. )he transaction in 'uestion is overned (y Article 15-- of the *ivil *ode. )rue it is that the plaintiff was a(le to re ister the sale in his name (ut was he in ood faith in doin soK Dhile the title was re istered in plaintiff$ appellant5s name on 9e(ruary 9, 1971 %13h. A&, it appears that he 0new of the sale of the land to defendants$spouses @e aspi as he was informed in the 8ffice of the "e ister of ;eeds of Hue#on. 2t appears that the defendants$spouses re istered their document of sale on 7ay 1=, 19?5 under Primary 1ntry +o. 21,11= of the "e ister of ;eeds %13h. 2&. 4nder the fore oin circumstances, the ri ht of ownership and title to the land must (e resolved in favor of the defendants$ spouses @e aspi on three counts. 9irst, the plaintiff$appellant was not in ood faith in re isterin the title in his name. *onsistent is the .urisprudence in this .urisdiction that in order that the provisions of Article 15-of the new *ivil *ode may (e invo0ed, it is necessary that the conveyance must have (een made (y a party who has an e3istin ri ht in the thin and the power to dispose of it %1, 7anresa 17,, 171&. 2t cannot (e set up (y a second purchaser who comes into possession of the property that has already (een ac'uired (y the first purchaser in full dominion %/autista vs. !ison, =9 Phil. ?15&, this not withstandin that the second purchaser records his title in the pu(lic re istry, if the re istration (e done in (ad faith, the philosophy underlyin this rule (ein that the pu(lic records cannot (e covered into instruments of fraud and oppression (y one who secures an inscription therein in (ad faith %*hupin hon vs. /orreros, 7 *A "ep. ?99&. A purchaser who has 0nowled e of fact which would put him upon in'uiry and investi ation as to possi(le defects of the title of the vendor and fails to ma0e such in'uiry and investi ation, cannot claim that he is a purchaser in ood faith. Pnowled e of a prior transfer of a re istered property (y a su(se'uent purchaser ma0es him a purchaser in (ad faith and his 0nowled e of such transfer vitiates his title ac'uired (y virtue of the latter instrument of conveyance which creates no ri ht as a ainst the first purchaser %"eyla o vs. Jara(e, @$2,,-?, 7arch 27, 19?A, 22 !*"A 12-7&.

2n the second place, the defendants$spouses re istered the deed of a(solute sale ahead of plaintiff$ appellant. !aid spouses were not only a(le to o(tain the title (ecause at that time, the owner5s duplicate certificate was still with the Philippine +ational /an0. 2n the third place, defendants$spouses have (een in possession all alon of the land in 'uestion. 2f immova(le property is sold to different vendees, the ownership shall (elon to the person ac'uirin it who in ood faith first recorded it in the re istry of property6 and should there (e no inscription, the ownership shall pertain to the person who in ood faith was first in the possession %!oriano, et al. vs. )he Beirs of ;omin o 7a ali et al., @$151== , July =1, 19?=, A !*"A -A9&. Priority of possession stands ood in favor of herein defendants$spouses %1van elista vs. A(ad, E*AF =? 8.:. 291=6 !anche# vs. "amos, -, Phil. ?1-, Huimson vs, "osete, A7 Phil. 159&. )he *ourt finds that in this case of dou(le sale of real property, respondent appellate court, on the (asis of the undisputed facts, correctly applied the provisions of Article 15-- of the *ivil *ode that Art. 15--. 2f the same thin should have (een sold to different vendees, the ownership shall (e transferred to the person who may have first ta0en possession thereof in ood faith, if it should (e mova(le property. !hould it (e immova(le property, the ownership shall (elon to the person ac'uirin it who in ood faith first recorded it in the "e istry of Property. !hould there (e no inscription, the ownership shall pertain to the person who in ood faith was first in the possession6 and, in the a(sence thereof, to the person who presents the oldest title, provided there is ood faith. )here is no 'uestion that respondents$spouses )eofilo @e aspi and 2luminada *a(ana were the first (uyers, first on June 1, 19?5 under a sale with ri ht of repurchase and later on 8cto(er 21, 19?A under a deed of a(solute sale and that they had ta0en possession of the land sold to them6 that petitioner was the second (uyer under a deed of sale dated +ovem(er 29, 19?A, which to all indications, contrary to the te3t, was a sale with ri ht of repurchase for ninety %9,& days. 1 )here is no 'uestion either that respondents le aspi spouses were the first and the only ones to (e in possession of the su(.ect property. !aid respondents spouses were li0ewise the first to re ister the sale with ri ht of repurchase in their favor on 7ay 1=, 19?5 under Primary 1ntry +o. 21,11= of the "e ister of ;eeds. )hey could not re ister the a(solute deed of sale in their favor and o(tain the correspondin transfer certificate of title (ecause at that time the seller5s duplicate certificate was still with the (an0. /ut there is no 'uestion, and the lower courts so found conclusively as a matter of fact, that when petitioner *ru# succeeded in re isterin the later sale in his favor, he 0new and he was informed of the prior sale in favor of respondents$spouses. "espondent appellate court correctly held that such <0nowled e of a prior transfer of a re istered property (y a su(se'uent purchaser ma0es him a purchaser in (ad faith and his 0nowled e of such transfer vitiates his title ac'uired (y virtue of the latter instrument of conveyance which creates no ri ht as a ainst the first purchaser.< As the *ourt held in 0arbone vs. 0ourt of +ppea s 2 <it is essential that the (uyer of realty must act in ood faith in re isterin his deed of sale to merit the protection of the second para raph of Ethe a(ove 'uotedF Article 15--.< As the writer stressed in his concurrin opinion therein, <%)&he overnin principle here is prius tempore, potior 9ure %first in time, stron er in ri ht&. Pnowled e ained (y the first (uyer of the second sale cannot defeat the first (uyer5s ri hts e3cept only as

provided (y the *ivil *ode and that is where the second (uyer first re isters in good faith the second sale ahead of the first. !uch 0nowled e of the first (uyer does not (ar her from availin of her ri hts under the law, amon them, to re ister first her purchase as a ainst the second (uyer. /ut in converso0nowled e ained (y the second (uyer of the first sale defeats his ri hts even if he is first to re ister the second sale, since such 0nowled e taints his prior re istration with (ad faith. )his is the price e3acted (y Article 15-- of the *ivil *ode for the second (uyer (ein a(le to displace the first (uyer6 that (efore the second (uyer can o(tain priority over the first, he must show that he acted in ood faith throu hout %i.e. in i norance of the first sale and of the first (uyer5s ri hts& > from the time of ac'uisition until the title is transferred to him (y re istration or failin re istration, (y delivery of possession. )he second (uyer must show continuin ood faith and innocence or lac0 of 0nowled e of the first sale until his contract ripens into full ownership throu h prior re istration as provided (y law.< Petitioner5s prayer for alternative relief for reim(ursement of the amount of P2,=52.5, paid (y him to the (an0 to dischar e the e3istin mort a e on the property and of the amount of P=,=97.5, representin the price of the second sale are well ta0en insofar as the seller @eode aria *a(ana is concerned. )hese amounts have (een received (y the said seller @eode aria *a(ana on account of a void second sale and must (e duly reim(ursed (y her to petitioner5s heirs, (ut the @e aspi spouses cannot (e held lia(le therefor since they had nothin to do with the said second sale nor did they receive any (enefit therefrom. Petitioner5s claim for reim(ursement of the amount of P1,2.5A as real estate ta3es paid on the property is not well ta0en (ecause the respondents @e aspi spouses had (een payin the real estate ta3es on the same property since June 1, 19?9. 4 A**8";2+:@G, the appealed .ud ment of respondent appellate court, upholdin respondents$ spouses )eofilo @e aspi and 2luminada *a(ana as the true and ri htful owners of the property in liti ation and orderin the issuance of a new title with the cancellation as null and void of )itle +o. )$ 991-, o(tained (y petitioner A(elardo *. *ru#, is here(y affirmed in toto. 2n accordance with the partial rant of petitioner5s prayer for alternative relief as stated in the precedin para raph hereof, the *ourt here(y orders and sentences respondent @eode aria *a(ana to reim(urse and pay to petitioner5s heirs the total sum of P5,75,.,,.