SALES BATCH 5 CASE DIGESTS 2JD-B

CASE 1: CASTRO A
ABRIGO vs DE VERA; June 21, 2004 (Art.1544)
FACTS:
Gloria Villafania sold a house and lot to Rosenda
Tigno-Salazar and Rosita Cave-Go. The sale became a
subject of annulment between the vendor and vendees.
The parties came to a compromise agreement that
Gloria will be given a year to buy back the property and
failure to buy would render the sale to Rosenda and
Rosita as binding. Gloria failed to buy the property so
the vendees declared the lot in their name.
Unknown to Rosenda and Rosita, Gloria
obtained a free patent over the parcel of land
involved.On October 16, 1997, Rosenda and Rosita
subsequently sold the property to herein petitioner Sps.
Abrigo. While on October 23, 1997, Gloria sold the
property to herein respondent De Vera.
De Vera filed an action for forcible entry against
Sps Abrigo. The case was dismissed because of the
agreement of the 2 parties (neither of them can
physically take possession of the property in question
until the termination of the instant case). Sps Abrigo
filed the instant case for annulment of document
against De Vera and Gloria.
The RTC ruled in favor of the petitioners. On
appeal, the CA ruled that a void title could not give rise
to a valid one. It dismissed the appeal of De Vera. It
likewise dismissed the appeal of petitioners for
damages. On reconsideration, CA ruled in favor of
De Vera finding that he is a purchaser in good
faith and for value. The appellate court ruled that
she had relied in good faith on the Torrens title of
her vendor and thus must be protected.
ISSUE:
Who has a better right to the property

HELD:
Respondent De Vera has a better right over the
property. Being a purchaser of good faith and for value,
she must be protected. CA amended decision affirmed.
The present case involves what in legal
contemplation was a double sale the sale by Gloria
to Rosenda and Rosita and the formers sale to
respondent De Vera. Art. 1544 of the Civil Code
provides that a double sale of immovable
transfers ownership to 1) the first registrant in
good faith; 2) then, the possessor in good faith
and 3) finally, the buyer who in good faith
presents the oldest title. The principle is full accord
with Sec. 51 of PD 1529 which provides that no deed,
mortgage, lease or other voluntary instrument except
a will purporting to convey or affect registered land
until its registration. Thus, if the sale is not
registered, it is only binding between the vendor
and vendee.
Petitioners, unaware that the property was
covered by the Torrens system, registered the sale
under Act 3344. Respondent registered under the
Torrens system. In this case, the registration under
the Torrens system shall prevail. This is in
accordance with the insight of J. Paras if the land is
registered under LRA (torrens), and it is sold but
the subsequent sale is registered not under LRA
but 3344, such sale is not considered registered.
It is consistently held that that Art. 1544
requires the second buyer to acquire the
immovable in good faith and to register it in good
faith. Mere registration is not enough; good faith
must concur with the registration. The governing
principle is primus tempore, potior jure(first in time,
stronger in right). Knowledge gained by the first
buyer of the second sale cannot defeat the first

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buyers rights except where the second buyer
registers in good faith the second sale ahead of
the first.
In this case, De Vera is held to be in good faith.
The factual findings revealed that the subject land was
and still is registered in the name of Gloria. There is
nothing in her certificate of title and in the
circumstances of the transaction or sale which warrant
De Vera in supposing that she needed to look beyond
the title. She had no notice of the earlier sale to
petitioners. She examined her vendors title in the
Registry of Deeds and actually going to the premises.
The only legal truth which she had to rely was
that the land is registered in the name of Gloria
Villafania, her vendor, and that her title under the
law, is absolute and indefeasible.
CASE 2: CASTRO J
<UNKNOWN>
CASE 3: DELOS REYES
NAAWAN COMMUNITY RURAL BANK INC vs. CA
FACTS:
On April 30, 1988, a certain Guillermo Comayas offered
to sell to private respondent-spouses Alfredo and
Annabelle Lumo, a house and lot located at Cagayan de
Oro City.
Wanting to buy said house and lot, private respondents
made inquiries at the Office of the Register of Deeds of
Cagayan de Oro City where the property is located and
the Bureau of Lands on the legal status of the vendors
title. They found out that the property was mortgaged
for P8,000 to a certain Mrs. Galupo and that the owners
copy of the Certificate of Title to said property was in

her possession. Private respondents directed Guillermo

Comayas to redeem the property from Galupo at their
expense, giving the amount of P10,000 to Comayas for
that purpose.On May 30, 1988, a release of the adverse
claim of Galupo was annotated on TCT No. T-41499
which covered the subject property.
After obtaining their TCT, private respondents requested
the issuance of a new tax declaration certificate in their
names. However, they were surprised to learn from the
City Assessors Office that the property was also
declared for tax purposes in the name of petitioner
Naawan Community Rural Bank Inc.
Apparently, on February 7, 1983, Guillermo Comayas
obtained a P15,000 loan from petitioner Bank using the
subject property as security. At the time said contract of
mortgage was entered into, the subject property was
then an unregistered parcel of residential land, taxdeclared in the name of a certain Sergio A. Balibay
while the residential one-storey house was tax-declared
in the name of Comayas.
Balibay executed a special power of attorney
authorizing Comayas to borrow money and use the
subject lot as security. But the Deed of Real Estate
Mortgage and the Special Power of Attorney were
recorded in the registration book of the Province of
Misamis Oriental, not in the registration book of
Cagayan de Oro City. It appears that, when the
registration was made, there was only one Register of
Deeds for the entire province of Misamis Oriental,
including Cagayan de Oro City. It was only in 1985 when
the Office of the Register of Deeds for Cagayan de Oro
City was established separately from the Office of the
Register of Deeds for the Province of Misamis Oriental.
For failure of Comayas to pay, the real estate mortgage
was foreclosed and the subject property sold at a public
auction to the mortgagee Naawan Community Rural

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Bank as the highest bidder in the amount of P16,031.35.
On July 23, 1984, Transfer Certificate of Title No. T41499 in the name of Guillermo P. Comayas was entered
in the Register of Deeds of Cagayan de Oro City.
Meanwhile, on September 5, 1986, the period for
redemption of the foreclosed subject property lapsed
and the MTCC Deputy Sheriff of Cagayan de Oro City
issued and delivered to petitioner bank the sheriffs
deed of final conveyance. This time, the deed was
registered under Act 3344 and recorded in the
registration book of the Register of Deeds of Cagayan
de Oro City.
By virtue of said deed, petitioner Bank obtained a tax
declaration for the subject house and lot. Thereafter,
petitioner Bank instituted an action for ejectment
against Comayas before the MTCC which decided in its
favor. RTC affirmed.
On January 27, 1989, the Regional Trial Court issued an
order for the issuance of a writ of execution of its
judgment. The MTCC, being the court of origin, promptly
issued said writ.
However, when the writ was served, the property was
no longer occupied by Comayas but herein private
respondents, the spouses Lumo who had, as earlier
mentioned, bought it from Comayas on May 17, 1988.
Alarmed by the prospect of being ejected from their
home, private respondents filed an action for quieting of
title which was docketed as Civil Case No. 89-138. After
trial, the Regional Trial Court rendered a decision
declaring private respondents as purchasers for value
and in good faith, and consequently declaring them as
the absolute owners and possessors of the subject
house and lot.
ISSUE: Whether or not the private respondents are
purchasers in good faith.

HELD:
Yes. Article 1544 provides:
x x x. Should it be immovable property, the ownership
shall belong to the person acquiring it who in good faith
first recorded it in the Registry of Property.
Petitioner contends that the due and proper registration
of the sheriffs deed of final conveyance on December 2,
1986 amounted to constructive notice to private
respondents. Thus, when private respondents bought
the subject property on May 17, 1988, they were
deemed to have purchased the said property with the
knowledge that it was already registered in the name of
petitioner bank. However, It is a well-known rule in this
jurisdiction that persons dealing with registered land
have the legal right to rely on the face of the Torrens
Certificate of Title and to dispense with the need to
inquire further, except when the party concerned has
actual knowledge of facts and circumstances that would
impel a reasonably cautious man to make such inquiry.
Also, Before private respondents bought the subject
property from Guillermo Comayas, inquiries were made
with the Registry of Deeds and the Bureau of Lands
regarding the status of the vendors title. No liens or
encumbrances were found to have been annotated on
the certificate of title. Neither were private respondents
aware of any adverse claim or lien on the property other
than the adverse claim of a certain Geneva Galupo to
whom Guillermo Comayas had mortgaged the subject
property. But, as already mentioned, the claim of Galupo
was eventually settled and the adverse claim previously
annotated on the title cancelled. Thus, having made the
necessary inquiries, private respondents did not have to
go beyond the certificate of title. Otherwise, the efficacy
and conclusiveness of the Torrens Certificate of Title
would be rendered futile and nugatory.

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Considering
therefore
that
private
respondents
exercised the diligence required by law in ascertaining
the legal status of the Torrens title of Guillermo
Comayas over the subject property and found no flaws
therein, they should be considered as innocent
purchasers for value and in good faith.
Accordingly, the appealed judgment of the appellate
court upholding private respondents Alfredo and
Annabelle Lumo as the true and rightful owners of the
disputed property is affirmed.
CASE 4: DINGLASAN
CARUMBA v. CA
Ponente: Reyes, J.B.L.
Vendor: Spouses Amado Canuto& Nemesia Ibasco
Vendee: (1) Spouses Amado Carumba& Benita Canuto;
(2) Santiago Balbuena
Point: Case exception to the rule that in the case of a
double sale, registration in good faith prevails over
possession.
FACTS
1. Subject land:a parcel of partly residential, partly
coconut land (with periphery area of 359.09
square meters) in Camarines Sur
2. April 12, 1955 VENDOR sold subject land to
VENDEE1 by virtue of a "Deed of Sale of
Unregistered Land with Covenants of Warranty"
for the sum of P350.00. The deed of sale was
never registered in the Office of the Register of
Deeds of Camarines Sur, and the Notary, Mr.
Vicente Malaya, was not then an authorized
notary public in the place.
3. January 21, 1957 a complaint for sum of money
was filed by VENDEE2 against the VENDOR before
the Justice of the Peace Court of Iriga, Camarines

Sur. Such complaint ripened into a civil case of

which a decision was later on rendered dated April
15, 1957 in favour of VENDEE2 against the
VENDOR.
4. Oct 1, 1968 -- the ex-officio Sheriff of Camarines
Sur issued a "Definite Deed of Sale of the property
in favour of VENDEE2. Such instrument of sale
was registered before the Office of the Register of
Deeds of Camarines Sur. The aforesaid property
was declared for taxation purposes in the name of
VENDEE2.
CFI: Ruled in favour of VENDEE1. The court, based on
its findings, declared VENDEE1 the owner of the
property under a consummated sale because after
the execution of the sale, they immediately took
possession of the land planting thereon bananas,
coffee and other vegetables thereon. Also held as
void the the execution levy made by the sheriff and
nullified the sale in favour of VENDEE2.
CA: Reversed CFI and ruled in favour of VENDEE2.
There having been a double sale of the land,
VENDEE2s title was superior to that of VENDEE1
under Article 1544 of the Civil Code of the
Philippines, since the execution sale had been
properly registered in good faith and the sale to
VENDEE1 was not recorded.
ISSUE: Who is the real owner of the land?
HELD:
1. VENDEE1 is the real owner.
Article 1544 finds no application in the case at
bar, even if VENDEE2, the later vendee, was
ignorant of the prior sale made by his judgment
debtor in favor of VENDEE1.

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Under Section 35 of Rule 39 of the Revised Rules
of Court, the purchaser of unregistered land at a
sheriff's execution sale only steps into the shoes
of the judgment debtor, and merely acquires the
latter's interest in the property sold as of the time
the property was levied upon.
While the time of the levy does not clearly appear,
it could not have been made prior to 15 April
1957, when the decision against the former
owners of the land was rendered in favor of
Balbuena. But the deed of sale in favor of Canuto
had been executed two years before, on 12 April
1955, and while only embodied in a private
document, the same, coupled with the fact that
the buyer (VENDEE1) had taken possession of the
unregistered land sold, sufficed to vest ownership
on the said buyer. When the levy was made by
the Sheriff, therefore, the judgment debtor
no longer had dominical interest nor any
real right over the land that could pass to
the purchaser at the execution sale. Hence
VENDEE2 must yield to VENDEE1.
CASE 5: GALICINAO
RADIOWEALTH FINANCE COMPANY vs PALILEO;
197 SCRA 245
FACTS:
The spouses Castro sold to respondent Manuelito
Palileo a parcel of unregistered coconut land situated in
Candiis, Mansayaw, Mainit, Surigao del Norte. The sale
is evidenced by a notarized Deed of Absolute Sale, but
deed was not registered in the Registry of Property for
unregistered lands.
Since the execution of the deed of sale, Palileo who
was then employed at Lianga, Surigao del Sur, exercised

acts of ownership over the land through his mother as

administratrix or overseer and has continuously paid the
real estate taxes on said land.
Later, a judgment was rendered against Castro by the
CFI to pay Radiowealth Finance Company a sum of
money. A writ of execution iras issued and the subject
land was levied upon and sold at a public auction.
A certificate of sale was executed by the Provincial
Sheriff in favor of Radiowealth Finance Company, being
the only bidder. After the period of redemption expired,
a deed of final sale was also executed by the same
Provincial Sheriff. Both the certificate of sale and the
deed of final sale were registered with the Registry of
Deeds.
Palileo learned of what happened and filed an action
for quieting of title. After a trial on the merits, the court
rendered a decision in his favor. CA affirmed the
decision.
ISSUE: Whether registration of a sale in ones favor
gives the buyer any right over the land if the vendor
was not anymore the owner of the land having
previously sold the same to somebody else even if the
earlier sale was unrecorded.
HELD
No. Generally, it is the act of registration that
operates to convey and affect registered land.
Therefore, a bona fide purchaser of a registered land at
an execution sale acquires a good title as against a prior
transferee, if such transfer was unrecorded. However,
this case deals with a parcel of unregistered land and a
different set of rules applies.
Under Act No. 3344, registration of instruments
affecting unregistered lands is without prejudice to
a third party with a better right. The aforequoted

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phrase has been held by this Court to mean that the
mere registration of a sale in ones favor does not give
him any right over the land if the vendor was not
anymore the owner of the land having previously sold
the same to somebody else even if the earlier sale was
unrecorded.

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