ABRIGO vs. DE VERA

  

Spouses NOEL and JULIE ABRIGO, petitioners v. ROMANA DE VERA, respondent.

G.R. No. 154409 |  June 21, 2004

 

FACTS

On May 27, 1993, Gloria Villafania sold a house and lot located at Banaoang, Mangaldan, Pangasinan and covered by Tax Declaration No. 1406 to Rosenda Tigno-Salazar and Rosita Cave-Go. The said sale became a subject of a suit for annulment of documents between the vendor and the vendees.

On December 7, 1993, the Regional Trial Court, Branch 40 of Dagupan City rendered judgment approving the Compromise Agreement submitted by the parties. In the said Decision, Gloria Villafania was given one year from the date of the Compromise Agreement to buy back the house and lot, and failure to do so would mean that the previous sale in favor of Rosenda Tigno-Salazar and Rosita Cave-Go shall remain valid and binding and the plaintiff shall voluntarily vacate the premises without need of any demand. Gloria Villafania failed to buy back the house and lot, so the [vendees] declared the lot in their name.

Unknown, however to Rosenda Tigno-Salazar and Rosita Cave-Go, Gloria Villafania obtained a free patent over the parcel of land involved [on March 15, 1988 as evidenced by OCT No. P-30522]. The said free patent was later on cancelled by TCT No. 212598 on April 11, 1996. On October 16, 1997, Rosenda Tigno-Salazar and Rosita Cave-Go, sold the house and lot to the herein [Petitioner-Spouses Noel and Julie Abrigo]. On October 23, 1997, Gloria Villafania sold the same house and lot to Romana de Vera . . . Romana de Vera registered the sale and as a consequence, TCT No. 22515 was issued in her name.

On November 12, 1997, Romana de Vera filed an action for Forcible Entry and Damages against [Spouses Noel and Julie Abrigo] before the Municipal Trial Court of Mangaldan, Pangasinan docketed as Civil Case No. 1452. On February 25, 1998, the parties therein submitted a Motion for Dismissal in view of their agreement in the instant case that neither of them can physically take possession of the property in question until the instant case is terminated. Hence the ejectment case was dismissed.’ Thus, on November 21, 1997, [petitioners] filed the instant case [with the Regional Trial Court of Dagupan City] for the annulment of documents, injunction, preliminary injunction, restraining order and damages [against respondent and Gloria Villafania].

After the trial on the merits, the lower court rendered the assailed Decision dated January 4, 1999, awarding the properties to [petitioners] as well as damages. Moreover, . . . Gloria Villafania was ordered to pay [petitioners and private respondent] damages and attorney’s fees.

The CA its original Decision promulgated on November 19, 2001, the CA held that a void title could not give rise to a valid one and hence dismissed the appeal of Private Respondent Romana de Vera. Since Gloria Villafania had already transferred ownership to Rosenda Tigno-Salazar and Rosita Cave-Go, the subsequent sale to De Vera was deemed void. On reconsideration, the CA issued its March 21, 2002 Amended Decision, finding Respondent De Vera to be 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 must thus be protected

ISSUE: Who between petitioner-spouses and respondent has a better right to the property?

RULING:

Respondent has a better right to the property.

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

Law provides that a double sale of immovables transfers ownership to (1) the first registrant in good faith; (2) then, the first possessor in good faith; and (3) finally, the buyer who in good faith presents the oldest title. There is no ambiguity in the application of this law with respect to lands registered under the Torrens system. This principle is in full accord with Section 51 of PD 1529 which provides that no deed, mortgage, lease or other voluntary instrument — except a will — purporting to convey or affect registered land shall take effect as a conveyance or bind the land until its registration. Thus, if the sale is not registered, it is binding only between the seller and the buyer but it does not affect innocent third persons.

In the instant case, both Petitioners Abrigo and respondent registered the sale of the property. Since neither petitioners nor their predecessors (Tigno-Salazar and Cave-Go) knew that the property was covered by the Torrens system, they registered their respective sales under Act 3344. For her part, respondent registered the transaction under the Torrens system because, during the sale, Villafania had presented the transfer certificate of title (TCT) covering the property. Respondent De Vera contends that her registration under the Torrens system should prevail over that of petitioners who recorded theirs under Act 3344.

We agree with respondent. It is undisputed that Villafania had been issued a free patent registered as Original Certificate of Title (OCT) No. P-30522. The OCT was later cancelled by Transfer Certificate of Title (TCT) No. 212598, also in Villafania’s name. As a consequence of the sale, TCT No. 212598 was subsequently cancelled and TCT No. 22515 thereafter issued to respondent. Since the property in dispute in the present case was already registered under the Torrens system, petitioners’ registration of the sale under Act 3344 was not effective for purposes of Article 1544 of the Civil Code. For the same reason, inasmuch as the registration of the sale to Respondent De Vera under the Torrens system was done in good faith, this sale must be upheld over the sale registered under Act 3344 to Petitioner-Spouses Abrigo.

Article 1544 of the Civil Code has no application to land not registered under Act No. 496. Applying [Section 33], Rule 39 of the Revised Rules of Court, this Court held that Article 1544 of the Civil Code cannot be invoked to benefit the purchaser at the execution sale though the latter was a buyer in good faith and even if this second sale was registered. It was explained that this is because 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.

We have consistently held that Article 1544 requires the second buyer to acquire the immovable in good faith and to register it in good faith. Mere registration of title is not enough; good faith must concur with the registration.

Equally important, under Section 44 of PD 1529, every registered owner receiving a certificate of title pursuant to a decree of registration, and every subsequent purchaser of registered land taking such certificate for value and in good faith shall hold the same free from all encumbrances, except those noted and enumerated in the certificate. Thus, a person dealing with registered land is not required to go behind the registry to determine the condition of the property, since such condition is noted on the face of the register or certificate of title. Following this principle, this Court has consistently held as regards registered land that a purchaser in good faith acquires a good title as against all the transferees thereof whose rights are not recorded in the Registry of Deeds at the time of the sale.

Registration of the second buyer under Act 3344, providing for the registration of all instruments on land neither covered by the Spanish Mortgage Law nor the Torrens System (Act 496), cannot improve his standing since Act 3344 itself expresses that registration thereunder would not prejudice prior rights in good faith. Registration, however, by the first buyer under Act 3344 can have the effect of constructive notice to the second buyer that can defeat his right as such buyer in good faith. Art. 1544 has been held to be inapplicable to execution sales of unregistered land, since the purchaser merely steps into the shoes of the debtor and acquires the latter's interest as of the time the property is sold or when there is only one sale.

As can be gathered from the foregoing, constructive notice to the second buyer through registration under Act 3344 does not apply if the property is registered under the Torrens system, as in this case.

The Court of Appeals examined the facts to determine whether respondent was an innocent purchaser for value.  After its factual findings revealed that Respondent De Vera was in good faith, it explained thus:

“. . . Gloria Villafania, [Respondent] De Vera’s vendor, appears to be the registered owner. The subject land was, and still is, registered in the name of Gloria Villafania. There is nothing in her certificate of title and in the circumstances of the transaction or sale which warrant [Respondent] De Vera in supposing that she need[ed] to look beyond the title. She had no notice of the earlier sale of the land to [petitioners]. She ascertained and verified that her vendor was the sole owner and in possession of the subject property by examining her vendor’s title in the Registry of Deeds and actually going to the premises. In sum, she testified clearly and positively, without any contrary evidence presented by the [petitioners], that she did not know anything about the earlier sale and claim of the spouses Abrigo, until after she had bought the same, and only then when she bought the same, and only then when she brought an ejectment case with the . . . Municipal Court of Mangaldan, known as Civil Case No. 1452. To the [Respondent] De Vera, the only legal truth upon which she had to rely was that the land is registered in the name of Gloria Villafania, her vendor, and that her title under the law, is absolute and indefeasible.

We find no reason to disturb these findings, which petitioners have not rebutted. Spouses Abrigo base their position only on the general averment that respondent should have been more vigilant prior to consummating the sale. They argue that had she inspected the property, she would have found petitioners to be in possession. This argument is contradicted, however, by the spouses’ own admission that the parents and the sister of Villafania were still the actual occupants in October 1997, when Respondent De Vera purchased the property. The family members may reasonably be assumed to be Villafania’s agents, who had not been shown to have notified respondent of the first sale when she conducted an ocular inspection. Thus, good faith on respondent’s part stands.

 

WHEREFORE, the Petition is DENIED and the assailed Decision AFFIRMED. Costs against petitioners.