XVII Rules in case of double sale Paylago vs. Jarabe Facts: cts: The The enti entire re lot lot invo involv lve ed in this his suit suit was was orig origin inal ally ly registered in the name of Anselmo Lacatan. After his death, the transfer certificate was issued in the name his two sons and heirs, Vidal and Florentino Lacatan. After Vidal Lacatan died, his heirs executed a deed of sale of a portion of their lot in favor of petitioners-spouses. ears after, Florentino Lacatan also died. !is heir heirs s li"e li"ewi wise se exec execut uted ed a deed deed of sale sale in favo favorr of the the same same vendees over a portion of the same lot. #pon the registration of the two deeds of sale, a new T$T was issued in favor favor of petitioners-spouses. !owever, !owever, su%se&uent su%d su%div ivis isio ion n surv urvey for for the the purpo urpose se of segr segreg egat atin ing g the the two two portions of land descri%ed in the deeds revealed that a portion of the total area purchased %y petitioners was %eing occupied %y defend defendant ant-re -respo sponde ndent. nt. !ence, !ence, an action action to recove recoverr possess possession ion and ownership of the said portion was filed. The lower court rendered 'udgment in favor of respondent, and was affirmed in toto %y the $ourt of Appeals (ssu (ssue: e: )ho )ho has has a %ett %etter er righ rightt in case case of do dou% u%le le sale sale of real real prope propert rty y, the the regis registe tere red d %uye %uyerr or the the prior prior %ut %ut unre unregi gist stere ered d purchaser* !eld: As held %y the $ourt, the general general rule in this matter matter is that, %etween two purchasers, the one who has registered the sale in his favor, in good faith, has a preferred right over the other who has not registered his title, even if the latter is in the actual posse ssession ion of the immova%le prop roperty. This is in accordance with Art +, providing that if the same immova%le prop proper ertty shou hould hav have %een %een sold sold to diffe iffere rent nt vendee ndees, s, the the ownership shall %elong to the person ac&uiring it who in good faith first recorded it in the registry of property. !owever, it was found found that that thei theirr ac&u ac&uisi isiti tion on and and su%s su%se& e&uen uentt regi regist stra rati tion on were were tainted with the vitiating element of %ad faith/ petitioners "new %eforehand that the parcel of land in &uestion was owned %y respondent. The fundamental premise of the preferential rights esta%lished %y Article + of the 0ew $ivil $ode is good faith. To %e entitled to the priority, the second vendee must not only show
prior recording of his deed of conveyance or possession of the property sold, %ut must, a%ove all, have acted in good faith, that is to say, without "nowledge of the existence of another alienation %y his vendor to a stranger. Hanopol vs. Pilapil Facts: (luminado !anopol claims ownership of the land %y virtue of a series of purchases effected in +123 %y means of private instruments, executed %y the former owners Teodora, Lucia, 4enerosa, 5inforosa and (sa%elo, all surnamed 5iapo. 6erfecto 6ilapil. asserts title to the property on the strength of a duly notari7ed deed of sale executed in his favor %y the same owners on 8ecem%er 2, +1, which deed of sale was registered in the 9egistry of 8eeds. (ssue: wn the registration of the second sale in favour of 6ilapil affects !anopol;s rights as the first vendee !eld: es, it will. (t appears from the documentary evidence that 6ilapil derived his right to the land from the sale to him of the said property on 8ecem%er 2, +1, long %efore the filing of the complaint against the vendors in +13.
Balatbat vs. CA Facts: A parcel of land was ac&uired %y plaintiff Aurelio 9o&ue and >aria >esina during their con'ugal union. >aria died on August ?3, +1@@. aria;s estate, divided e&ually among him at his children. The decision having %ecome final and executory, the 9egister of 8eeds of >anila issued a transfer certificate of title on ay ?D, +13? %ut did not file her complaint in intervention, hence, the decision was rendered adversely against her. (f petitioner did investigate %efore %uying the land, she should have "nown that there was a pending case and an annotation of adverse claim was made in the title of the property %efore the 9egister of 8eeds and she could have discovered that the su%'ect property was already sold to the private respondents. (t is incum%ent upon the vendee of the property to as" for the delivery of the owners duplicate copy of the title from the vendor. A purchaser of a valued piece of property cannot 'ust close his eyes to facts which should put a reasona%le man upon his guard and then claim that he acted in good faith and under
the %elief that there were no defect in the title of the vendor. 21G
Caram vs. aureta Facts: >arcos >ata conveyed an agricultural land in favor of the respondent. The deed of a%solute sale was not registered %ecause it was not ac"nowledged %efore a notary pu%lic or any other authori7ed officer. At the time the sale was executed, there was no authori7ed officer %efore whom the sale could %e ac"nowledged inasmuch as the civil government in Tagum, 8avao was not as yet organi7ed. !owever, >arcos >ata delivered to respondent the peaceful and lawful possession of the premises of the land together with the pertinent papers thereof. 5ince then repondent Laureta had %een and is still in continuous, adverse and notorious occupation of said land, without %eing molested, distur%ed or stopped %y any of the defendants or their representatives. (n fact, he had %een paying realty taxes due thereon and had introduced improvements worth not less than 6?D,DDD.DD at the time of the filing of the complaint. !owever, the said property was sold to Fermin $aram, r., the petitioner, %y >arcos >ata on >ay , +1B. And the latter was a%le to declare the <8<$T in the possession of Laureta null and void, after >ata filed for an issuance of new <8<$T %efore the 9egistry of 8eeds of 8avao on the ground of loss of the said title. The Trial $ourt ruled infavor of respondent, stating that petitioner was not a
purchase rin good faith, and the $ourt of Appeals then after affirmed the decision of the lower court. (ssue:
wn petitioner acted is a purchaser in good faith
!eld: 0o. Ead faith is not %ased solely on the fact that a vendee had "nowledge of the defect or lac" of title of his vendor. (n the instant case, (respe and Aportadera had "nowledge of circumstances which ought to have put them an in&uiry. Eoth of them "new that >ata=s certificate of title together with other papers pertaining to the land was ta"en %y soldiers under the command of $ol. $laro L. Laureta. Added to this is the fact that at the time of the second sale Laureta was already in possession of the land. (respe and Aportadera should have investigated the nature of Laureta=s possession. (f they failed to exercise the ordinary care expected of a %uyer of real estate they must suffer the conse&uences. The rule of caveat emptor re&uires the purchaser to %e aware of the supposed title of the vendor and one who %uys without chec"ing the vendor=s title ta"es all the ris"s and losses conse&uent to such failure. The principle that a person dealing with the owner of the registered land is not %ound to go %ehind the certificate and in&uire into transactions the existence of which is not there intimated should not apply in this case. (t was of common "nowledge that at the time the soldiers of Laureta too" the documents from >ata, the civil government of Tagum was not yet esta%lished and that there were no officials to ratify contracts of sale and ma"e them registera%le. <%viously, Aportadera and (respe "new that even if >ata previously had sold t he 8isputed such sale could not have %een registered. There is no dou%t then that (respe and Aportadera, acting as agents of $aram, purchased the property of >ata in %ad faith. Applying the principle of agency, $aram as principal, should also %e deemed to have acted in %ad faith !a"edo vs. CA Facts: La7aro TaHedo executed a deed of a%solute sale in favor of 9icardo TaHedo and Teresita Earrera in which he conveyed a parcel of land which he will inherit. #pon the death of his father he executed an affidavit of conformity to reaffirm the said sale. !e also executed another deed of sale in favor of the spouses
covering the parcel of land he already inherited. 9icardo registered the last deed of sale in the registry of deeds in their favor. 9icardo later on learned that La7aro sold the same property to his children through a deed of sale. (ssue: wn respondents acted in good faith in registering the deed of sale !eld: The property in &uestion is land, an immova%le, and following the a%ove-&uoted law, ownership shall %elong to the %uyer who in good faith registers it first in the registry of property. Thus, although 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 registration.
!anongon vs. #amson Facts: 9espondents filed a complaint against $ayco >arine 5ervice I$A$
su%'ect motor tan"er, having ac&uired the same from
wn petitioner is a %uyer in good faith and for value
!eld: 0o. the act of adrid %rothers were the registered owners of a lot situated in 5an >ateo, (sa%ela. The lot was then su%divided into several more.
daughter while the former;s children continued their possession of the lot. >eanwhile, the >adrid %rothers, in a deed of sale, conveyed all their rights and interests over the su%'ect lot to 6acifico >ar&ue7. The deed was su%se&uently registered. !e then su%divided the lot into eight parts, four of which he mortgaged to petitioner %an". The mortgage was then registered. !owever >ar&ue7 defaulted in payment which caused the foreclosure of the mortgaged properties and the lots were sold to it as the highest %idder. The !eirs-now respondents filed a case for reconveyance and damages for the southern portion of the su%'ect property against >ar&ue7 and $9E. The 9T$ handed down a decision in favor of >ar&ue7. The !eirs interposed an appeal with the $A, which upheld the claim of the !eirs. !ence, the instant $9E petition. (ssue: wn there is a dou%le sale !eld: The provision of Art + is not applica%le in the present case. (t contemplates a case of dou%le or multiple sales %y a single vendor. >ore specifically, it covers a situation where a single vendor sold one and the same immova%le property to two or more %uyers. According to a noted civil law author, it is necessary that the conveyance must have %een made %y a party who has an existing right in the thing and the power to dispose of it. (t cannot %e invo"ed where the two different contracts of sale are made %y two different persons, one of them not %eing the owner of the property sold. And even if the sale was made %y the same person, if the second sale was made when such person was no longer the owner of the property, %ecause it had %een ac&uired %y the first purchaser in full dominion, the second purchaser cannot ac&uire any right. (n the case at %ar, the su%'ect property was not transferred to several purchasers %y a single vendor. (n the first deed of sale, the vendors were 4amiao and 8ayag whose right to the su%'ect property originated from their ac&uisition thereof from 9i7al >adrid with the conformity of all the other >adrid %rothers in +1B, followed %y their declaration of the property in its entirety for taxation purposes in their names. adrid %rothers %ut
at that time they were no longer the owners since they had long %efore disposed of the property in favor of 4amiao and 8ayag. %ela &erced vs. '#I# Facts: 5pouses Kulueta are the owners of several parcels of land located at 6asig $ity. Later on they o%tained a loan from the 4overnment 5ervie (nsurance 5ystem, as security for which they mortgaged the part of their owned lands. (t was expressly stipulated in the mortgage deed that certain lots within shall %e excluded from the mortgage %ecause they have %een either previously sold to third parties or donated to the government. 5everal additional loans were o%tained which caused to include other parts of the lot. >eanwhile, the Kulueta spouses executed a contract to sell where%y they undertoo" to sell to Francisco dela >erced and varista >endo7a part of the su%'ect lot. After full payment %y $ol. dela >erced of the purchase price, a 8eed of A%solute 5ale was executed %y the Kuluetas in his favor. Later, the Kulueta spouses mortgaged parts of the su%'ect properties which eventually was foreclosed. #pon consolidation of 45(5s ownership, Kuluetas name was cancelled, and an issuance in the name of 45(5 was given.++G #pon learning of the foreclosure, filed a complaint+?G praying for the nullity of the 45(5 foreclosure on the su%'ect properties on the ground that he was the owner of these lots at the time of the foreclosure. 6etioner argued that, due to the nullity of 45(5s foreclosure over the su%'ect properties, it had no ownership right that could %e transferred. (ssue: wn petitioners have preferential rights over respondents !eld: 6etitioners rights of ownership over the properties in dispute, al%eit unregistered, are superior to the registered mortgage rights of 45(5 over the same. The execution and validity of the contract to sell dated 5eptem%er 2, +1B executed %y the Kulueta spouses, as the former su%division owner, in favor of Francisco dela >erced, are %eyond cavil. There is also no dispute that the contract to sell was entered into %y the parties %efore the third mortgage was constituted on erced
was a%le to fully pay the purchase price to the vendor, who later executed a deed of a%solute sale in his favor. !owever, the Kuluetas defaulted on their loans/ hence, the mortgage was foreclosed and the properties were sold at pu%lic auction to 45(5 as the highest %idder. Therefore, the registered right of 45(5 as mortgagee of the property is inferior to the unregistered right of Francisco dela >erced. The unrecorded sale %etween Francisco dela >erced as the vendee of the property and the Kuluetas, the original owners, is preferred for the same reason stated a%ove. #an oren(o %evelopment Corp. vs. CA Facts: 5pouses Lu purportedly sold the two parcels of land to respondent 6a%lo Ea%asanta. The latter made a downpayment of as evidenced %y a memorandum receipt issued of the same date. 5everal other payments were made %y respondent. !e demanded the execution of a Final 8eed of 5ale in his favor so he may effect full payment of the purchase price/ however, the spouses declined to push through with the sale. They claimed that when he re&uested for a discount and they refused, he rescinded the agreement. Thus, Ea%asanta filed a case for 5pecific 6erformance. ortgage. (t alleged that it was a %uyer in good faith and for value and therefore it had a %etter right over the property in litigation. (ssue: wn the registration of the sale after the annotation of the notice of lis pendens o%literate the effects of delivery and possession in good faith !eld: 0o. At the time %oth deeds were executed, 5L8$ had no "nowledge of the prior transaction of the 5pouses Lu with Ea%asanta. 5imply stated, from the time of execution of the first deed up to the moment of transfer and delivery of possession of the lands to 5L8$, it had acted in good faith and the su%se&uent annotation of lis pendens has no effect at all on the consummated sale %etween 5L8$ and the 5pouses Lu. A purchaser in good faith is one who %uys property of another without notice that some other person has a right to, or
interest in, such property and pays a full and fair price for the same at the time of such purchase, or before he has notice of the claim or interest of some other person in the property. DG Following the foregoing definition, we rule that 5L8$ &ualifies as a %uyer in good faith since there is no evidence extant in the records that it had "nowledge of the prior transaction in favor of Ea%asanta. At the time of the sale of the property to 5L8$, the vendors were still the registered owners of the property and were in fact in possession of the lands. Time and again, this $ourt has ruled that a person dealing with the owner of registered land is not %ound to go %eyond the certificate of title as he is charged with notice of %urdens on the property which are noted on the face of the register or on the certificate of title Carumba vs. CA Facts: 5pouses Amado $anuto and 0emesia (%asco, %y virtue of a deed of sale, sold a parcel of landin favour of the spouses Amado $arum%a and Eenita $anuto. The referred deed of sale was never registered notary, was not then an authori7ed notary pu%lic in the place. (t has also %een expressly admitted Amado $anuto is the older %rother of the wife of Amado $arum%a. A complaint for a sum or money was filed against Amado $anuto and 0emesia (%asco %y 5antiago Eal%uena, and a decision was rendered in favor against them. The ex-officio 5heriff, issued a 8efinite 8eed of 5al of the property now in &uestion in favor of 5antiago Eal%uena, which instrument of sale was registered. The aforesaid property was declared for taxation purposes in the name of 5antiago Eal%uena. The $ourt of First instance nullified the sale in favor of the 'udgment creditor, 5antiago Eal%uena. !owever upon appeal, the appellate court declared that there having %een a dou%le sale of the land su%'ect of the suit Eal%uena=s title was superior to that of the other/ the execution %eing properly registered in good faith and that the sale to $arum%a was not recorded. (ssue:
wn there is dou%le sale
!eld: #nder the invo"ed Article + registration in good faith prevails over possession in the event of a dou%le sale %y the vendor of the same piece of land to different vendees, however it does not apply to the present case, even if Eal%uena, the later
vendee, was ignorant of the prior sale made %y his 'udgment de%tor in favor of petitioner $arum%a. The reason is that the purchaser of unregistered land at a sheriff=s execution sale only steps into the shoes of the 'udgment de%tor, and merely ac&uires the latter=s interest in the property sold as of the time the property was levied upon. Eut the deed of sale in favor of $anuto had %een executed earlier. Addiotnally, the fact that petitioner $arum%a had ta"en possession of the unregistered land sold, sufficed to vest ownership on the said %uyer. )hen the levy was made %y the 5heriff, therefore, the 'udgment de%tor no longer had dominical interest nor any real right over the land that could pass to the purchaser at the execution sale. !ence, the latter must yield the land to petitioner $arum%a.
