jer sales cases

8/13/2019 Jer Sales Cases

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G.R. No. L-29972 January 26, 1976

ROSARIO CARBONELL, petitioner,vs.HONORABLE COURT OF AEALS, JOSE ONCIO, E!!A INFANTE an" RA!ONINFANTE, respondents.

!A#ASIAR, J.

Prior to January 27, 1955, respondent Jose Poncio was the owner of the parcel of land hereininvolve with improvements situated at 179 V. Aan !t., !an Juan, "i#al, havin an area of some onehundred ninety$five %195& s'uare meters, more or less, covered (y )*) +o. 5- and su(ect tomortae in favor of the "epu(lic !avins /an0 for the sum of P1,5..

Petitioner "osario *ar(onell, a cousin and adacent neih(or of respondent Poncio, lived in theadoinin lot at 177 V. Aan !treet.

/oth petitioners "osario *ar(onell and respondent mma nfante o$$%r%" &o 'uythe said lot fromPoncio.

"espondent Poncio, una'(% &o )%%* u* +& &% n&a((/%n&due on the mortae, a**roa0%"Car'on%(( an" o$$%r%" &o %(( &o &% (a&&%r &% a" (o&, %0(u"n &% ou% +%r%nr%*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 priceproposed (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 !avins /an0 and secured the0on%n& o$ &% r%"%n&thereof $or %r &o *ay &% arr%ar on &% /or&a% an" &o 0on&nu%&% *ay/%n& o$ &% n&a((/%n& a &%y $a(( "u%. )he amount in arr%ar r%a0%" a &o&a( u/ o$247.26. /ut (ecause respondent Poncio had previously told her that &% /on%y, n%%"%" +aon(y 255.55, only the latter amount was (rouht (y petitioner constrainin respondent Joseon0o &o +&"ra+ &% u/ o$ 47.55 $ro/ 'an) "%*o& +& R%*u'(0 Sa3n Ban). /utthe ne3t day, *%&&on%r r%$un"%" &o on0o &% u/ o$ 47.55.

)hereafter, *%&&on%r a)%" A&&y. Sa(3a"or R%y%to prepare the formal deed of sale, which she(rouht to respondent Poncio to her assumin the mortaed o(liation to "epu(lic !avins /an0.

4pon arrivin at respondent Jose Poncios house, however, the latter told petitioner that he could notproceed any more with the sale, (ecause % a" a(r%a"y 3%n &% (o& &o r%*on"%n& E//aIn$an&%6 and that % 0ou(" no& +&"ra+ $ro/ "%a( +& r%*on"%n& !r. In$an&%, even if hewere to o to ail.

Petitioner then souht to contact respondent rs. nfante (ut the latter refused to see her.

8n e(ruary 5, 1955, *%&&on%r a+ E//a In$an&% %r%0&n a(( aroun" &% (o& +& a a&%.


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%&&on%r 0onu(&%" A&&y. Jo% Gar0a, who a"3%" %r &o *r%%n& an a"3%r% 0(a/ o3%r &%(an" n u%&on +& &% O$$0% o$ &% R%&%r o$ %%" o$ R8a(. Atty. :arcia actually sent aletter of in'uiry to the "eister of ;eeds and "%/an" (%&&%r &o *r3a&% r%*on"%n& Jo% on0oan" E//a In$an&%.

n his answer to the complaint on0o a"/&&%" &a& on January :5, 19;;, !r. In$an&%

/*ro3%" %r o$$%r an" % ar%%" &o %(( &% (an" an" & /*ro3%/%n& &o %r $or :,;:;.55 of the prior sale of the lot (yPoncio to *ar(onell. 8rdinarily, one will not refuse to see a neih(or. nfante lives ust (ehind thehouse of *ar(onell. Ber refusal to tal0 to *ar(onell could only mean that she did not want to listen to*ar(onells story that she %*ar(onell& had previously (ouht the lot from Poncio.

%2& Car'on%(( +a a(r%a"y n *o%on o$ &% /or&a% *a'oo)Enot Poncios savin depositpass(oo0 > 3hi(it nfantesF an" on0o= 0o*y o$ &% /or&a% 0on&ra0&, +%n on0oo(" &% (o& Car'on%(( +o, a$&%r *ayn &% arr%ara% o$ on0o, au/%" &% 'a(an0% o$ /or&a%" n"%'&%"n% &o &% 'an), +0 n &% nor/a( 0our% o$ 'un% /u& a3%n%0%ar(y n$or/%" In$an&% a'ou& &% a" au/*&on 'y Car'on%(( o$ &% /or&a%n"%'&%"n% o$ on0o. /efore or upon payin in full the mortae inde(tedness of Poncio to the/an0. nfante naturally must have demanded from Poncio the delivery to her of his mortaepass(oo0 as well as Poncios mortae contract so that the fact of full payment of his (an0 mortaewill (e entered therein6 and Poncio, as well as the (an0, must have inevita(ly informed her that saidmortae pass(oo0 could not (e iven to her (ecause it was already delivered to *ar(onell.

f Poncio was still in possession of the mortae pass(oo0 and his copy of the mortae contract atthe time he e3ecuted a deed of sale in favor of the nfantes and when the nfantes redeemed his

mortae inde(tedness from the (an0, Poncio would have surrendered his mortae pass(oo0 andhis copy of the mortae contract to the nfantes, who could have presented the same as e3hi(itsdurin the trial, in much the same way that the nfantes were a(le to present as evidence 3hi(it nfantes, Poncios savins deposit pass(oo0, of which Poncio necessarily remained in possessionas the said deposit pass(oo0 was never involved in the contract of sale with assumption ofmortae. !aid savins deposit pass(oo0 merely proves that Poncio had to withdraw P-7.2?, whichamount was tided to the sum of P2. paid (y *ar(onell for Poncios amorti#ation arrearaes infavor of the (an0 on January 27, 19556 (ecause *ar(onell on that day (rouht with her onlyP2., as Poncio told her that was the amount of his arrearaes to the (an0. /ut the ne3t day*ar(onell refunded to Poncio the sum of P-7.2?.

%=& )he fact that on0o +a no (on%r n *o%on o$ /or&a% *a'oo) an" &a& &%

a" /or&a% *a'oo) +a a(r%a"y n *o%on o$ Car'on%((, ou(" a3% 0o/*%((%"In$an&% &o nur% $ro/ on0o +y % +a no (on%r n *o%on o$ &% /or&a%*a'oo) an" $ro/ Car'on%(( +y % +a n *o%on o$ &% a/%%Palao, et. al vs. Jaraet al 22 !*"A 12-7, 1252$125=&. )he only plausi(le and loical reason why nfante did not (otheranymore to ma0e such inury , w (ecause in the ordinary course of (usiness the (an0 must have toldher that Poncio already sold the lot to *ar(onell who there(y assumed the mortae inde(tednessof Poncio and to whom Poncio delivered his mortae pass(oo0. Bopin to ive a sem(lance oftruth to her pretended ood faith, nfante snu((ed *ar(onells re'uest to tal0 to her a(out the prior


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sale to her ( Poncio of the lot. As aforestated, this is not the attitude e3pected of a ood neih(orim(ued with *hristian charity and ood will as well as a clear conscience.

%-& Car'on%(( r%&%r%" on F%'ruary


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AGUAN TRAING CO!AND,petitioner,vs.RUSTICO !ACA!,respondent.

ION, J.:

n the year 1955, !ammy aron and his seven (rothers and sisters were pro$indiviso owners of aparcel of unreistered land located in (arrio Parayao, unicipality of /inmaley, Panasinan. Dhiletheir application for reistration of said land under Act +o. -9? was pendin, they e3ecuted, on June19 and !eptem(er 21, 1955, two deeds of sale conveyin the property to appellee, who thereaftertoo0 possession thereof and proceeded to introduce su(stantial improvements therein. 8ne monthlater, that is, on 8cto(er 1-, 1955, 8riinal *ertificate of )itle +o. ?9-2 coverin the land was issued

in the name of the arons, free from all liens and encum(rances.

8n Auust -, 195?, (y virtue of a final udment rendered in *ivil *ase +o. -2215 of the unicipal*ourt of anila aainst !ammy aron in favor of the anila )radin and !upply *ompany, levy wasmade upon whatever interest he had in the aforementioned property, and thereafter said interestwas sold at pu(lic auction to the udment creditor. )he correspondin notice of levy, certificate ofsale and the !heriffs certificate of final sale in favor of the anila )radin and !upply *o. >(ecause no(ody e3ercised the riht of redemptions > were duly reistered. 8n arch 1, 195, thelatter sold all its rihts and title to the property to appellant.

)he 'uestion (efore 4s now isC Dho has the (etter riht as (etween appellant ;aupan )radin*ompany, on the one hand, and appellee "ustico acam, on the other, to the one$eihth share of

!ammy aron in the property mentioned heretoforeK

f the property covered (y the conflictin sales were unregisteredland, acam would undou(tedlyhave the (etter riht 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 inthe conflictin transactions duly reistered land, De would (e inclined to hold that appellant has the(etter riht (ecause, as De have consistently held, in case of conveyance of reistered real estate,the reistration of the deed of sale is the operative act that ives validity to the transfer. )his would(e fatal to appellees claim, the deeds of sale e3ecuted in his favor (y the arons not havin (eenreistered, while the levy in e3ecution and the provisional certificate of sale as well as the final deedof sale in favor of appellant were reistered. *onse'uently, this reistered conveyance must prevailalthouh posterior to the one e3ecuted in favor of appellee, and appellant must (e deemed to haveac'uired such riht, title and interest as appeared on the certificate of title issued in favor of !ammy

aron, 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., ? Phil. ?5?6 /anco +acional, etc. vs. *amus, 7 Phil.29&

)he present case, however, does not fall within either, situation. Bere the sale in favor of appelleewas e3ecutedbeforethe land su(ect$matter thereof was reistered, while the conflictin sale in favorof appellant was e3ecutedafterthe same property had (een reistered. De cannot, therefore, decidethe case in the liht of whatever adudicated cases there are coverin the two situations mentionedin the precedin pararaph. t is our considered view that what should determine the issue are the


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provisions of the last pararaph of !ection =5, "ule =9 of the "ules of *ourt, to the effect that uponthe e3ecution and delivery of the final certificate of sale in favor of the purchaser of land sold in ane3ecution sale, such purchaser and a new law or system which would ma0e possi(le the overthrowin of suchownership on admittedly artificial and technical rounds, the former must (e upheld andapplied.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 aron, appellee too0possession of the land conveyed as owner thereof, and introduced considera(le improvementsthereon. )o deprive him now of the same (y sheer force of technicality would (e aainst (oth usticeand e'uity.

+ VD 8 A@@ )B 8":8+:, the decision appealed from is affirmed, with costs.

FELIE AI an" ANTONIA G. AI, petitioners,vs.EULOGIO BANIN @u'&&u&%" 'y (%a( %r, na/%(y JUANA SILERIO, JOSE,GABRIEL, ANICETA, IRGINIA an" FELI, a(( urna/%" Ban"n GREGORIO BANIN,RAD!UNA BANIN, ALENTIN BRIONES, SOFIO BRIONES an" AGAITARA!OS. respondents.

No. L-49712 A*r(


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No. L-49716 A*r(


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Fro/ &% "%0on o$ &% Cour& o$ A**%a(, an a**%a( +a &a)%n 'y &% *ar&% a"3%r%(ya$$%0&%" &%r%'y &o & Cour&. E0%*& $or *%&&on%r n G.R. No. L-49716 +o %%) r%&ora&ono$ &% &a&u uo an&%, a(( o&%r *%&&on%r *ray &a& &% "%0on o$ &% &ra( 0our& '%r%n&a&%".

T% $a0& an&%0%"%n& o$ & *%&&on, a /ay '% a&%r%" $ro/ &% "%0on, ar% a $o((o+

urn &%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,R8a( 1 A *ar0%( o$ (an" &ua&%" n Barro Ta(on, +& an ar%a o$ :9,


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2 To Juan&a !ar&n ? Lo& 2, 0on&ann an ar%a o$ 774 uar% /%&%r, "%0(ar%" un"%r Ta%0(ara&on No. 4on& r%a( %&a&% 3%n&ur% +0 &%y a" %n&%r%"n&o +& &% %n&uran8a n A*r( 19;9. Juan&a !ar&n "a. "% Lu0%na +a a'(% &o r%&%r&% *ro*%r&y n %r na/% an" +a u%" OCT No. u"0a((y or %&ra->u"0a(y %&&(%" a/on &%r %r, +o, &%r%$or%, r%/an%" *ro-n"3o0o-o+n%r o$ &% a" *ro*%r&%, an" u*on &% "%a& o$ 0&oran an" Can""a, &%rr%*%0&3% ar% n &urn *a%" &o &%r %r. A00or"n(y, &% &ra( 0our& "%0(ar%" &%*(an&$$, Aa*&a Ra/o, an" &% %r o$ 0&oran Ra/o, %n&&(%" &o &+o- &r" @2K: *ro-n"3o ar% o$ &% Ta(on an" Laon *ro*%r&%, an" or"%r%" &% "%$%n"an& %r o$Can""a Ra/o &o r%0on3%y &o *(an&$$ &%r ar% n &o% *ro*%r&%. Ho+%3%r, u0r%0on3%yan0% +a no (on%r *o'(% +& r%*%0& &o &% *or&on +0, n &% /%an&/%,


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a" '%%n o(" an" "*o%" o$ &o &r" *ar&% +o +%r% *ur0a%r n oo" $a& an" $or3a(u%.

T% $o((o+n *ar&% +%r% %(" &o '% *ur0a%r n oo" $a&. 1 "%$%n"an& Ru$no !ran"a,Nar0o %(au%8, A('na !ran"a an" %(au%8 R%a(&y Co., +& r%*%0& &o 24,6:6 uar%/%&%r @ar0%( 1 o$ &% Ta(on *ro*%r&y o(" 'y Can""a Ra/o, Eu(oo Ban"n an" Aa*&a

Ra/o n 194: 2 "%$%n"an& Jo% Ra/r%8 an" A/'ro0a "a. "% Ra/r%8 @+"o+ o$ So&%roRa/r%8, +& r%*%0& &o 7;2 uar% /%&%r @ar0%( 2 an" ;16 uar% /%&%r @ar0%( :,r%*%0&3%(y, o$ &% Ta(on *ro*%r&y, : "%$%n"an& Cono(a0on "% (a Cru8, +& r%*%0& &o 774uar% /%&%r @Lo& 1 o$ Su'"3on (an SU-17:299 4 "%$%n"an& N%/%o !ar&n, +&r%*%0& &o 774 uar% /%&%r @Lo& 2 o$ Su'"3on (an ; "%$%n"an& !ano "% (a Cru8, +&r%*%0& &o :55 uar% /%&%r o(" 'y 0&ora !ar&n an" :55 uar% /%&%r o(" 'y!a/na !ar&n @*or&on o$ Lo& ; an" 6 o$ Su'"3on (an 6 "%$%n"an& *ou% F%(*%an" An&ona a3", +& r%*%0& &o 1;,555 uar% /%&%r o$ &% Laon *ro*%r&y. Sn0% &%$or%on *ro*%r&% 0ou(" no& '% r%0on3%y%" &o &% *(an&$$, &% "%$%n"an& %r +o o("&%/ +%r% or"%r%" &o *ay &% *(an&$$ &+o-&r" @2K: o$ &% *r%%n& 3a(u% o$ u0*ro*%r&%.

A &a&%" %r%&o$or%, &% &ra( 0our&= "%0on +a u*%(" 'y &% r%*on"%n& Cour& o$A**%a(, %0%*& +& r%*%0& &o &% $n"n &a& &r" *ar&% +o 'ou& *or&on o$ &%*ro*%r&% $ro/ &% "%$%n"an& %r +%r% *ur0a%r n oo" $a& T $n"n +a r%3%r%"'y &% r%*on"%n& a**%((a&% 0our&. In $n%, &% a**%((a&% 0our& a nu(($%" &% a(% o$ &%Laon *ro*%r&y 'y Can""a Ra/o "a. "% !ar&n an" %r 0("r%n n 194: n $a3or o$H%r/o%n% Lu0%na, &% u'an" o$ Juan&a !ar&n, on% o$ &% "au&%r o$ Can""a, a +%na an u'%u%n& a(%, &ran$%r an" 0on3%yan0% o$ a" *ro*%r&y, no$ar a &%y a$$%0&%"&% &+o-&r" @2K: *ro-n"3o ar% o$ Aa*&a Ra/o an" &% %r o$ 0&oran Ra/o' nu(($%" &% a(% o$ *or&on o$ &% Ta(on *ro*%r&y 'y Can""a Ra/o, Eu(oo Ban"n an"Aa*&a Ra/o n 194: n $a3or o$ &% *ou% Ru$no !ran"a an" Na&3"a" Gun&o, an" a((&% u'%u%n& &ran$%r o$ a" *ro*%r&%, no$ar a &% $our-$$&%%n& @4K1; ar% o$Gr%oro Ban"n, Ray/un"o Ban"n, So$o Bron% an" a(%n&n Bron% +%r% a$$%0&%" an"0 n3a( "a&%" &% "%%" o$ %&ra>u"0a( *ar&&on a/on &% %r o$ Can""a Ra/o o3%r &%

r%/ann *or&on o$ &% Ta(on *ro*%r&y n 19;; an" &% u'"3on &%r%o$ n&o n"3"ua((o& a/on a" %r, a +%(( a a(( u'%u%n& &ran$%r an" 0on3%yan0% o$ o/% o$ a"(o&, or *or&on &%r%o$, &o &r" *ar&%, no$ar a &%y a$$%0&%" &% &+o-&r" @2K: *ro-n"3o ar% *%r&ann &o Aa*&a Ra/o an" &% %r o$ 0&oran Ra/o.

Fro/ &% a'o3% "%0on o$ &% Cour& o$ A**%a(, &% *%&&on%r a3% 0o/% &o u on%*ara&% *%&&on $or r%3%+ 'y 0%r&orar.

!.. #o. $%&9+1/.

T% *%&&on%r ar% &% %r o$ Can""a Ra/o, (%" 'y Juan&a !ar&n "a. "% Lu0%na an">on%" n 'y %r 'ro&%r an" &%r +o ar% &% 0("r%n o$ Can""a 'y %r $r& an" %0on"

/arra%. r/ar(y, *%&&on%r a((%%" &a& &% Cour& o$ A**%a( %rr%" n no& "%0(arn &a&*r3a&% r%*on"%n&= 0(a/ $ any, 'arr%" 'y *r%0r*&on an" n annu((n an" or"%rn &%0an0%((a&on o$ Orna( C%r&$0a&% o$ T&(% No.


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0our&, o+%3%r, $oun" &a& Can""a Ra/o, un&( %r "%a& on F%'ruary 1;, 19;;,a"/n&%r%" &% Laon *ro*%r&y, an" &a& *(an&$$- a**%((an& +%r% 3%n &%r ar% o$ &%$ru& &%r%o$, &ou rr%u(ar an" a& &/% (&&(%, "%*%n"n on &% a/oun& o$ &% ar3%&.Un"%r Ar&0(% 494 o$ &% n%+ C3( Co"% @Ar&0(% 455 o$ &% o(" C3( Co"%, *r%0r*&on%n%ra((y "o% no& run n $a3or o$ a 0o-%r or 0o-o+n%r a (on a, % %*r%(y or /*(%"(yr%0on8% &% 0o-o+n%r*. (% an /*(%" or 0on&ru0&3% &ru& *r%0r'% n &%n y%ar,

&% ru(% "o% no& a**(y +%r% a $"u0ary r%(a&on %& an" &% &ru&%% r%0on8% &%&ru&. 1

In &% 0a% a& 'ar, &%r% no o+n &a& &% r& o$ &% *(an&$$ a 0o-o+n%r +%r%r%*u"a&%" 'y Can""a Ra/o n %r ($%&/% n $a0&, &% %3"%n0% a $oun" 'y &% &ra( 0our&o+ &% 0on&rary.

T% 0our& a uo"" no& u&an &% "%$%n% o$ (a0% an" *r%0r*&on *u& u* 'y &%"%$%n"an& @%r%n *%&&on%r n0% & +a no& o+n &a& &% *(an&$$ +%r% u(&y o$n%(%n0% or (%*& on &%r r&. T%y %n& a (%&&%r o$ "%/an" &o &% %r o$ Can""aRa/o on A*r( 2:, 196:, an" $(%" &%r 0o/*(an& aan& &%/ on Jun% 14, 196:, or +&n a*%ro" o$ a**ro/a&%(y %& @


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*ro*%r&y $ro/ &% r%&%r%" o+n%r a$&%r &% uan0% o$ &% "%0r%% o$ r%&ra&on an" &%0orr%*on"n 0%r&$0a&% o$ &&(% n na/%. :

A &% r%0or" o+, *%&&on%r 'ou& &% *ro*%r&y +%n & +a &(( unr%&%r%" (an". T%"%$%n% o$ a3n *ur0a%" &% *ro*%r&y n oo" $a& /ay '% a3a(%" o$ on(y +%r%r%&%r%" (an" n3o(3%" an" &% 'uy%r a" r%(%" n oo" $a& on &% 0(%ar &&(% o$ &%

r%&%r%" o+n%r. On% +o *ur0a% an unr%&%r%" (an" "o% o a& *%r( H 0(a/ o$a3n 'ou& &% (an" n oo" $a&, .%. +&ou& no&0% &a& o/% o&%r *%ron a a r& &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/'ro0a . "a. "% Ra/r%8@+"o+ o$ So&%ro Ra/r%8, aa( &% "%0on o$ &% r%*on"%n& Cour& o$ A**%a( "%0(arn&%/ *ur0a%r n 'a" $a& an" or"%rn &%/ &o r%0on3%y &o &% *(an&$$ Gr%oro Ban"n,Ray/un"a Ban"nMA a(%n&n Bron% an" So&o Bron%, $our-$$&%%n& @4K1; ar% *ro-n"3o o$ &% *ro*%r&% &%y *ur0a%" $ro/ &% *ou% Ru$no !ran"a an" Na&3"a"

Gun&o. T% (an" n u%&on, 0on&ann an ar%a o$ ;16 uar% /%&%r, /or% or (%, +a*ur0a%" 'y Jo% Ra/r%8 on Jun% 4, 1949. So&%ro Ra/r%8 *ur0a%" (an", +& anar%a o$ 7;2 uar% /%&%r on Ju(y 9, 194< an" !ay 15, 1949. T%% *ar0%( o$ (an" *ur0a%"'y &% Ra/r%8% +%r% *ar& o$ &% *or&on o$ &% Ta(on *ro*%r&y 'ou& 'y &% *ou%Ru$no an" Na&3"a" !ran"a $ro/ Can""a Ra/o, Eu(oo Ban"n an" Aa*&a Ra/o n194:.

T% a**%((a&% 0our& %(" &a& Jo% Ra/r%8 an" $a&%r So&%ro Ra/r%8 +%r% no&*ur0a%r n oo" $a&, no& a3n /a"% "(%n& n3%&a&on o$ &% &ru% o+n%r* o$ &%*ro*%r&% &%y 'ou&, 'u& r%(%" /%r%(y on &% &a "%0(ara&on o+n &o &%/ 'y &% %((%r,Ru$no !ran"a. % a3% no r%aon &o "&ur' &% $or%on $n"n o$ &% r%*on"%n&a**%((a&% 0our&. B%"%, a /%n&on%" %ar(%r, &% u% o$ oo" $a& or 'a" $a& o$ &%'uy%r r%(%3an& on(y +%r% &% u'>%0& o$ &% a(% r%&%r%" (an" an" &% *ur0a%r

'uyn &% a/% $ro/ &% r%&%r%" o+n%r, +o% &&(% &o &% (an" 0(%an. In u0 0a%, &%*ur0a%r +o r%(% on &% 0(%an &&(% o$ &% r%&%r%" o+n%r *ro&%0&%" $ % a*ur0a%r n oo" $a& $or 3a(u%. Ho+%3%r, & no& &% &ua&on '%$or% u n &% n&an&0a%, a& *%&&on%r 'ou& +%r% unr%&%r%" (an".

%&&on%r 0on&%n" &a& &% r%*on"%n& ar% 'arr%" 'y %&o**%( an" (a0% $ro/ r%0o3%rn&% *ro*%r&y n u%&on % a3% a(r%a"y "%a(& +& & u% a'o3%. % $n" &% 0on&%n&on+&ou& /%r&.

%&&on%r u%& &a& &% *or&on or"%r%" &o '% &a)%n $ro/ &% *ro*%r&% o$ Jo% an"So&%ro Ra/r%8 ou(" '% &a)%n n&%a" $ro/ &% ar% +0 *%r&an &o an" ar% %(" 'y &%%r o$ Can""a Ra/o. % "o no& $n" &% u%&on /%r&orou. T% r%*on"%n& ar%

%n&&(%" &o &%r *ro- n"3o ar% o$ &% *ro*%r&y un(a+$u((y o(" 'y Can""a Ra/o,Aa*&a Ra/o an" Eu(oo Ban"n &o &% !ran"a *ou% $ro/ +o/ &% *%&&on%r'ou& &% *ar0%( o$ (an" n u%&on. H%n0%, & +ou(" no& '% *ro*%r $or &% 0our& &or%*on"%n&= r& &o r%0o3%r &%r *ro-n"3o ar% o$ &% *ro*%r&y on(y $ro/ &% r%/ann*or&on &(( n &% *o%on o$ &% %r o$ Can""a Ra/o.

!.. #o. $%&9+12:


14/51

T% 0a% o$ !ano "% (a Cru8 &an" on "$$%r%n& $oo&n $ro/ &% o&%r *%&&on. T%*ro*%r&y *ur0a%" 'y / $ro/ 0&ora !ar&n an" !a/na !ar&n +%r% r%&%r%" (an",0o3%r%" 'y Torr%n &&(%. B%n a *ur0a%r n oo" $a& $or 3a(u%, !ano "% (a Cru8 *ro&%0&%" 'y &% (a+. In &% a'%n0% o$ a o+n &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"n 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 0&ora an"!a/na !ar&n n $a3or o$ !ano "% (a Cru8 &o &% %&%n& &a& & *r%>u"0%" &% &+o-&r"@2K: *ro-n"3o ar% o$ r%*on"%n& n &% *ro*%r&y an" &o or"%r *%&&on%r &o r%0on3%ya" ar% &o r%*on"%n&. T% *%&&on o$ !ano "% (a Cru8 /%r&orou, an" &% "%0ona**%a(%" $ro/ ou(" '% /o"$%" a00or"n(y.

HEREFORE, n 3%+ o$ a(( &% $or%on, >u"/%n& %r%'y r%n"%r%"

1. /n &% *%&&on n G.R. No. L-4


15/51

!ELENCIO-HERRERA,J.:

)he ;isputed Property is a piece of unreistered land located at )i(auan, loilo dentified asAssessors @ot +o. =-=. t was previously owned (y respondents$appellees Jacinto )uvilla and*eferino )uvilla %the )uvillas, for short& (oth of )i(auan, loilo.

!ometime in 1955, the )uvillas e3ecuted a


16/51

8n July 1-, 1971, the same case was refiled, also in /ranch V, doc0eted as *ivil *ase +o. ?9%the "efiled *ase& which, however, was dismissed (y the *ourt on !eptem(er ?, 1971


17/51

SOUSES BONIFACIO R. ALE, JR. an" ENIA !. ALE, Petitioners,vs.HON. COURT OF AEALS, SOUSES GABRIEL FABELLA an" FRANCISCAFABELLA, "espondents.

; * ! 8 +

CHICO-NAARIO, J.:

)his petition for review under "ule -5 of the "ules of *ourt, filed (y petitioners spouses /onifacio ".

Valde#, Jr. and Venida . Valde#, see0s to nullify and set aside the 22 April 1997 decision1and =January 199 resolution of the *ourt of Appeals in *A$:.". !P +o. -=-92, which reversed the

udment, dated January 1997, of the "eional )rial *ourt of Antipolo, "i#al, /ranch 7-, in *ivil*ase +o. =?7, which, in turn, affirmed in totothe decision rendered (y the unicipal )rial *ourt of

Antipolo, "i#al, /ranch , in *ivil *ase +o. 25-7.

)his case oriinated from a complaint for unlawful detainer filed (y petitioners /onifacio and VenidaValde# aainst private respondents :a(riel and rancisca a(ella (efore the unicipal )rial *ourtof Antipolo, "i#al. )he complaint allees these material factsC

2. )hat plaintiffs are the reistered ownerEsF of a piece of residential lot denominated as @otE+Fo. = /l0 19 located at *arolina 3ecutive Villae, /ry. !ta. *ru#, Antipolo, "i#al which

EtheyF ac'uired from *arolina "ealty, nc. !ometime EiFn +ovem(er 1992 (y virtue of !ales*ontract, 3ero3 copy of which is hereto attached mar0ed as Anne3


18/51

the professional services of counsel thus incurrin e3penses amountin to )+ )B84!A+;P!8! %P1,.& representin acceptance fee and additional 8+ )B84!A+; P!8!%P1,.& per appearance, who on July 12, 199- sent a formal demand was li0ewiseinored, %sic& copy of which is hereto attached as Anne3


19/51

udment is here(y rendered ;!!!+: the complaint in *ivil *ase +o. 25-7 of the unicipal)rial *ourt of Antipolo, "i#al for lac0 of urisdiction.=

Petitioners filed a motion for reconsideration which was denied in a resolution dated = January199.-

Bence, the instant petition.

Petitioners su(mit the followin issues for the *ourtNs consideration5C

A. DB)B" 8" +8) )B A@@:A)8+! 8 )B *8P@A+) *@A"@G A; 84) A *A!8" 4+@AD4@ ;)A+".

/. DB)B" 8" +8) /A!; 8+ )B A@@:A)8+%!& 8 )B *8P@A+), )B 4+*PA@)"A@ *84") 8 A+)P8@8, "IA@, *@A"@G BA! 8":+A@ J4"!;*)8+ 8V" )B+!)A+) *8P@A+) @; /8" ).

!ince the two issues are closely intertwined, they shall (e discussed toether.

n the main, petitioners claim that the averments of their complaint ma0e out a case for unlawfuldetainer havin alleed that private respondents unlawfully withheld from them the possession of theproperty in 'uestion, which alleation is sufficient to esta(lish a case for unlawful detainer. )heyfurther contend that the summary action for eectment is the proper remedy availa(le to the owner ifanother occupies the land at the formerNs tolerance or permission without any contract (etween thetwo 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 recoverpossession of real propertyC %a& accion interdicta6 %(& accion pubiciana6 and %c& accion

reivindicatoria.?

+ccion interdictacomprises two distinct causes of action, namely, forci(le entry %detentacion& andunlawful detainer %desahuico&.7n forci(le entry, one is deprived of physical possession of realproperty (y means of force, intimidation, stratey, threats, or stealth whereas in unlawful detainer,one illeally withholds possession after the e3piration or termination of his riht to hold possessionunder any contract, e3press or implied.)he two are distinuished from each other in that in forci(leentry, the possession of the defendant is illeal from the (einnin, and that the issue is which partyhas prior de factopossession while in unlawful detainer, possession of the defendant is oriinallyleal (ut (ecame illeal due to the e3piration or termination of the riht 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 (rouht within one year from the date ofactual entry on the land, in case of forci(le entry, and from the date of last demand, in case ofunlawful detainer.11)he issue in said cases is the riht to physical possession.

+ccion pubicianais the plenary action to recover the riht of possession which should (e (rouht inthe proper reional trial court when dispossession has lasted for more than one year.12t is anordinary civil proceedin to determine the (etter riht of possession of realty independently oftitle.1=n other words, if at the time of the filin of the complaint more than one year had elapsedsince defendant had turned plaintiff out of possession or defendantNs possession had (ecome illeal,
http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt3http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt4http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt5http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt6http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt7http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt8http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt9http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt10http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt10http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt11http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt11http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt12http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt13http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt3http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt4http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt5http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt6http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt7http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt8http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt9http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt10http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt11http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt12http://www.lawphil.net/judjuris/juri2006/may2006/gr_132424_2006.html#fnt13


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the action will (e, not one of the forci(le entry or illeal detainer, (utan accionpubiciana. 8n theother hand, accion reivindicatoriais an action to recover ownership also (rouht in the properreional trial court in an ordinary civil proceedin.1-

)o ustify an action for unlawful detainer, it is essential that the plaintiffNs supposed acts of tolerancemust have (een present riht from the start of the possession which is later souht to (e

recovered.158therwise, if the possession was unlawful from the start, an action for unlawful detainerwould (e an improper remedy.1?As e3plained in !arona v. Villeas17C

/ut even where possession precedin the suit is (y tolerance of the owner, still, distinction should (emade.

f riht at the incipiency defendantNs possession was with plaintiffNs tolerance, we do not dou(t thatthe 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.

3 3 3 3

+ cose assessment of the aw and the concept of the word toerance confirms our view heretoforee-pressed that such toerance must be present right from the start of possession sought to berecovered, to categorie a cause of action as one of unawfu detainer ) not of forcibe entry. ndeed,to hold otherwise would espouse a danerous doctrine. And for two reasonsCFirst. orci(le entryinto the land is an open challene to the riht of the possessor. Violation of that riht authori#es thespeedy redress O in the inferior court $ provided for in the rules. f one year from the forci(le entry isallowed to lapse (efore suit is filed, then the remedy ceases to (e speedy6 and the possessor isdeemed to have waived his riht to see0 relief in the inferior court. !econd,if a forci(le entryaction in the inferior courtis allowed after the lapse of a num(er of years, then the result may well (ethat no action of forci(le entry can really prescri(e. +o matter how lon such defendant is in physicalpossession, plaintiff will merely ma0e a demand, (rin suit in the inferior court O upon a plea oftolerance to prevent prescription to set in $ and summarily throw him out of the land. !uch aconclusion is unreasona(le. specially if we (ear in mind the postulates that proceedins of forci(leentry and unlawful detainer are summary in nature, and that the one year time$(ar to suit is (ut inpursuance of the summary nature of the action.1%4nderlinin supplied&

t is the nature of defendantNs entry into the land which determines the cause of action, whether it isforci(le entry or unlawful detainer. f the entry is illeal, then the action which may (e filed aainstthe intruder is forci(le entry. f, however, the entry is leal (ut the possession thereafter (ecomesilleal, the case is unlawful detainer.

ndeed, to vest the court urisdiction to effect the eectment of an occupant, it is necessary that thecomplaint should em(ody such a statement of facts as (rins the party clearly within the class ofcases for which the statutes provide a remedy, as these proceedins are summary in nature. 19)hecomplaint must show enouh 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 averfacts constitutive of forci(le entry or unlawful detainer, as where it does not state how entry wasaffected or how and when dispossession started, the remedy should either (e an accion pu(licianaor an accion reivindicatoria in the proper reional trial court.21)hus, in :o, Jr. v. *ourt of

Appeals,22petitioners filed an unlawful detainer case aainst respondent allein that they were theowners of the parcel of land throuh intestate succession which was occupied (y respondent (ymere tolerance of petitioners as well as their deceased mother. "esolvin the issue on whether ornot petitionersN case for unlawful detainer will prosper, the court ruled2=C
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Petitioners alleed in their complaint that they inherited the property reistered under )*) +o. *$=211 from their parents6 that possession thereof (y private respondent was (y tolerance of theirmother, 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

t is settled that one whose stay is merely tolerated (ecomes a deforciant illeally occupyin the land

the moment he is re'uired to leave. t is essential in unlawful detainer cases of this 0ind, thatplaintiffNs supposed acts of tolerance must have (een present riht from the start of the possessionwhich is later souht to (e recovered. )his is where petitionersN cause of action fails. )he appellatecourt, in full areement with the )* made the conclusion that the alleed tolerance (y their motherand after her death, (y them, was unsu(stantiated. 3 3 3

)he evidence revealed that the possession of defendant was illeal at the inception and not merelytolerated as alleed in the complaint, considerin that defendant started to occupy the su(ect lotand 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 the0nowlede of the owners, conse'uently, it is cateori#ed as possession (y stealth which is forci(leentry. As e3plained in !arona vs. /iegas, cited in &u$o vs. 0ourt of+ppeasE22- !*"A 21?

%1992&F tolerance must (e present riht from the start of possession souht to (e recovered, tocateori#e a cause of action as one of unlawful detainer not of forci(le entry 3 3 3.

And in the case of )en orty "ealty and ;evelopment *orp. v. *ru#,2-petitionerNs complaint forunlawful detainer merely contained the (are alleations that %1& respondent immediately occupiedthe su(ect property after its sale to her, an action merely tolerated (y petitioner6 and %2& heralleedly illeal occupation of the premises was (y mere tolerance. )he court, in findin that thealleed 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(einnin of the possession. 3 3 3

3 3 3 3

n this case, the *omplaint and the other pleadins do not recite any averment of fact that wouldsu(stantiate the claim of petitioner that it permitted or tolerated the occupation of the property (y"espondent *ru#. )he complaint contains only (are alleations that 1& respondent immediatelyoccupied the su(ect property after its sale to her, an action merely tolerated (y petitioner6 and 2& heralleedly illeal occupation of the premises was (y mere tolerance.

)hese alleations contradict, rather than support, petitionerNs theory that its cause of action is forunlawful detainer. First,these aruments advance the view that respondentNs occupation of theproperty was unlawful at its inception. !econd,they counter the essential re'uirement in unlawfuldetainer cases that petitionerNs supposed act of sufferance or tolerance must (e present riht fromthe start of a possession that is later souht to (e recovered.25

n the instant case, the alleations in the complaint do not contain any averment of fact that wouldsu(stantiate petitionersN claim that they permitted or tolerated the occupation of the property (yrespondents. )he complaint contains only (are alleations that


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for unlawful detainer, the municipal trial court had no urisdiction over the case. 27t is in this liht thatthis *ourt finds that the *ourt of Appeals correctly found that the municipal trial court had no

urisdiction over the complaint.

DB"8", the petition is ;+; and the udment of the *ourt of Appeals dismissin thecomplaint in *ivil *ase +o. 25-7 of the )* Antipolo, "i#al for lac0 of urisdiction is here(y

A";.

+o pronouncement as to costs.

!8 8";";.

G.R. No. 1;1


23/51

)he antecedent facts in this case are as followsC

Pedro P. Pecson owned a commercial lot located at 27 amias"oad, Hue#on *ity, on which he (uilt a four$door two$storey apartment(uildin. or failure to pay realty ta3es, the lot was sold at pu(lic auction (y

the *ity )reasurer of Hue#on *ity to amerto +epomuceno, who in turn soldit for P1=, to the spouses Juan and rlinda +uuid.

Pecson challened the validity of the auction sale (efore the ")* ofHue#on *ity in *ivil *ase +o. H$-1-7. n its ;ecision,E=Fdated e(ruary ,199, the ")* upheld the spousesN title (ut declared that the four$door two$storey apartment (uildin was not included in the auction sale. E-F)his wasaffirmed intoto (y the *ourt of Appeals and thereafter (y this *ourt, in its;ecisionE5Fdated ay 25, 199=, in :.". +o. 15=? entitled ecson v. 0ourt of

+ppeas.

8n June 2=, 199=, (y virtue of the ntry of Judmentof the aforesaiddecision in :.". +o. 15=?, the +uuids (ecame the uncontested owners ofthe 25?$s'uare meter commercial lot.

As a result, the +uuid spouses moved for delivery of possession of thelot and the apartment (uildin.

n its 8rderE?Fof +ovem(er 15, 199=, the trial court, relyin upon Article5-?E7Fof the *ivil *ode, ruled that the !pouses +uuid were to reim(ursePecson for his construction cost of P5=,, followin which, thespouses +uuid were entitled to immediate issuance of a writ of possession

over the lot and improvements. n the same order the ")* also directedPecson to pay the same amount of monthly rentals to the +uuids as paid (ythe tenants occupyin the apartment units or P21, per month from June2=, 199=, and allowed the offset of the amount of P5=, due from the+uuids aainst the amount of rents collected (y Pecson from June 2=, 199=to !eptem(er 2=, 199= from the tenants of the apartment.EF

Pecson duly moved for reconsideration, (ut on +ovem(er , 199=,the ")* issued a Drit of Possession,E9Fdirectin the deputy sheriff to put thespouses +uuid in possession of the su(ect property with all the

improvements thereon and to eect all the occupants therein.Arieved, Pecson then filed a special civil action for certiorari and

prohi(ition doc0eted as *A$:.". !P +o. =2?79 with the *ourt of Appeals.

n its decision of June 7, 199-, the appellate court, relyin upon Article--E1Fof the *ivil *ode, affirmed the order of payment of construction costs (utrendered the issue of possession moot on appeal, thusC
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WHEREFORE, while it appears that private respondents [spouses Nuguid] have not

yet indemnified petitioner [Peson] with the ost of the improvements, sine !nne" #

shows that the $eputy %heriff has enfored 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 aademi,

although it is &ut fair and (ust that private respondents pay petitioner the onstrution

ost of P)*,+++++- and that petitioner &e ordered to aount for any and all fruits of

the improvements reeived &y him starting on .une /*, 011*, with the amount of

P)*,+++++ to &e offset therefrom

#2 #% %O OR$ERE$E11F[3ndersoring supplied]

rustrated (y this turn of events, Pecson filed a petition for reviewdoc0eted as :.". +o. 1151- (efore this *ourt.

8n ay 2?, 1995, the *ourt handed down the decision in :.". +o1151-, to witC

WHEREFORE, the deision of the 4ourt of !ppeals in 4!56R %P No */781 and

the Order of 0) Novem&er 011* of the Regional 2rial 4ourt, 9ranh 0+0, :ue;on

4ity in 4ivil 4ase No :5


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determination of the indemnity, (ut also in orderin Pecson to account for therentals of the apartment (uildin from June 2=, 199= to !eptem(er 2=, 199=.

8n the (asis of this *ourtNs decision in :.". +o. 1151-, Pecson filed aotion to "estore Possession and a otion to "ender Accountin, prayin

respectively for restoration of his possession over the su(ect 25?$s'uaremeter commercial lot and for the spouses +uuid to (e directed to render anaccountin under oath, of the income derived from the su(ect four$doorapartment from +ovem(er 22, 199= until possession of the same wasrestored to him.

n an 8rderE1=Fdated January 2?, 199?, the ")* denied the otion to"estore Possession to the plaintiff averrin that the current mar0et value ofthe (uildin should first (e determined. Pendin the said determination, theresolution of the otion for Accountin was li0ewise held in a(eyance.

Dith the su(mission of the partiesN assessment and the reports of thesu(ect realty, and the reports of the Hue#on *ity Assessor, as well as themem(ers of the duly constituted assessment committee, the trial court issuedthe followin 8rderE1-Fdated 8cto(er 7, 1997, to witC

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


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2he 4ourt finds plaintiffBs motion valid and meritorious 2he deision of the %upreme

4ourt in the aforesaid ase [Pecson vs. Court of Appeals, /


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Petitioners call our attention to the fact that after reachin an areed priceof P-, for the improvements, they only made a partial paymentof P=,. )hus, they contend that their failure to pay the full price for theimprovements will, at most, entitle respondent to (e restored to possession,(ut not to collect any rentals. Petitioners insist that this is the properinterpretation of the dispositive portion of the decision in :.". +o. 1151-,which states in part that QEtFhe value so determined shall (e forthwith paid (ythe private respondents E!pouses Juan and rlinda +uuidF to the petitionerEPedro PecsonF o&%r+%the petitioner shall (e restored to the possessionof the apartment (uildin until payment of the re'uired indemnity.RE21F

+ow herein respondent, Pecson, disarees with herein petitionersNcontention. Be arues that petitioners are wron in claimin that inasmuch ashis claim for rentals was not determined in the dispositive portion of thedecision in :.". +o. 1151-, 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 ofthe fruits of the property durin the period he was dispossessed (e accountedfor, since this *ourt e3plicitly reconi#ed in :.". +o. 1151-, he was entitledto the property. Be points out that this *ourt ruled that QEtFhe petitionerEPecsonF not havin (een so paid, he was entitled to retain ownership of the(uildin and, necessarily, the income therefrom.RE22Fn other words, saysrespondent, accountin was necessary. or accordinly, he was entitled torental income from the property. )his should (e iven effect. )he *ourt couldhave very well specifically included rent %as fruit or income of the property&,(ut could not have done so at the time the *ourt pronounced udment

(ecause its value had yet to (e determined, accordin to him. Additionally, hefaults the appellate court for modifyin the order of the ")*, thus defeatinhis riht as a (uilder in ood faith entitled to rental from the period of hisdispossession to full payment of the price of his improvements, which spansfrom +ovem(er 22, 199= to ;ecem(er 1997, or a period of more than fouryears.

t is not disputed that the construction of the four$door two$storeyapartment, su(ect of this dispute, was underta0en at the time when Pecsonwas still the owner of the lot. Dhen the +uuids (ecame the uncontested

owner of the lot on June 2=, 199=, (y virtue of entry of udment of the*ourtNs decision, dated ay 25, 199=, in :.". +o. 15=?, the apartment(uildin was already in e3istence and occupied (y tenants. n itsdecision dated ay 2?, 1995 in :.". +o. 1151-, the *ourt declared therihts and o(liations of the litiants in accordance with Articles -- and 5-?of the *ivil *ode. )hese provisions of the *ode are directly applica(le to theinstant case.
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4nder Article --, the landowner is iven the option, either to appropriatethe improvement as his own upon payment of the proper amount of indemnityor 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 thenecessary and useful e3penses incurred6 it also ives him riht of retentionuntil full reim(ursement is made.

Dhile the law aims to concentrate in one person the ownership of the landand the improvements thereon in view of the impractica(ility of creatin astate of forced co$ownership,E2=Fit uards aainst unust enrichment insofar asthe ood$faith (uilderNs improvements are concerned. )he riht of retention isconsidered as one of the measures devised (y the law for the protection of(uilders in ood faith. ts o(ect is to uarantee full and promptreim(ursement as it permits the actual possessor to remain in possessionwhile 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 usefulimprovements made (y him on the thin possessed.E2-FAccordinly, a (uilder inood faith cannot (e compelled to pay rentals durin the period ofretentionE25Fnor (e distur(ed in his possession (y orderin him to vacate. naddition, as in this case, the owner of the land is prohi(ited from offsettin orcompensatin the necessary and useful e3penses with the fruits received (ythe (uilder$possessor in ood faith. 8therwise, the security provided (y lawwould (e impaired. )his is so (ecause the riht to the e3penses and the rihtto the fruits (oth pertain to the possessor, ma0in compensation uridicallyimpossi(le6 and one cannot (e used to reduce the other.E2?F

As we earlier held, since petitioners opted to appropriate the improvementfor themselves as early as June 199=, when they applied for a writ ofe3ecution despite 0nowlede that the auction sale did not include theapartment (uildin, they could not (enefit from the lotNs improvement, untilthey reim(ursed the improver in full, (ased on the current mar0et value of theproperty.

;espite the *ourtNs reconition of PecsonNs riht of ownership over theapartment (uildin, the petitioners still insisted on dispossessin Pecson (yfilin for a Drit of Possession to cover (oth the lot and the (uildin. *learly,

this resulted in a violation of respondentNs riht of retention. Dorse,petitioners too0 advantae of the situation to (enefit from the hihly valued,income$yieldin, four$unit apartment (uildin (y collectin rentals thereon,(efore they paid for the cost of the apartment (uildin. t was only four yearslater that they finally paid its full value to the respondent.
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PetitionersN interpretation of our holdin in :.". +o. 1151- has neitherfactual nor leal (asis. )he decision of ay 2?, 1995, should (e construed inconnection with the leal principles which form the (asis of the decision,uided (y the precept that udments are to have a reasona(le intendment todo ustice and avoid wron.E27F

)he te3t of the decision in :.". +o. 1151- e3pressly e3empted Pecsonfrom lia(ility to pay rentals, for we found that the *ourt of Appeals erred notonly in upholdin the trial courtNs determination of the indemnity, (ut also inorderin him to account for the rentals of the apartment (uildin from June 2=,199= to !eptem(er 2=, 199=, the period from entry of udmentuntilPecsonNs dispossession. As pointed out (y Pecson,the dispositive portion of our decision in :.". +o. 1151- need not specificallyinclude the income derived from the improvement in order to entitle him, as a(uilder in ood faith, to such income. )he riht of retention, which entitles the

(uilder in ood faith to the possession as well as the incomederived therefrom, is already provided for under Article 5-? of the *ivil *ode.

:iven the circumstances of the instant case where the (uilder in ood faithhas (een clearly denied his riht of retention for almost half a decade, we findthat the increased award of rentals (y the ")* was reasona(le ande'uita(le. )he petitioners had reaped all the (enefits from the improvementintroduced (y the respondent durin said period, without payin any amountto the latter as reim(ursement for his construction costs and e3penses. )heyshould account and pay for such (enefits.

De need not (ela(or now the appellate courtNs reconition of hereinrespondentNs entitlement to rentals from the date of the determination of thecurrent mar0et value until its full payment. "espondent is clearly entitled topayment (y virtue of his riht of retention over the said improvement.

HEREFORE, the instant petition is ;+; for lac0 of merit. )he;ecision dated ay 21, 21 of the *ourt of Appeals in *A$:.". *V +o.?-295 is !) A!; and the 8rder dated July =1, 199, of the "eional )rial*ourt, /ranch 11, Hue#on *ity, in *ivil *ase +o. H$-1-7 orderin theherein petitioners, !pouses Juan and rlinda +uuid, 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$eiht )housand %P2,.& pesos monthly, for a period of -months, is here(y "+!)A);. 4ntil fully paid, said amount of rentalsshould (ear the leal rate of interest set at si3 percent %?S& per annumcomputed from the date of ")* udment. f any portion thereof shallthereafter remain unpaid, despite notice of finality of this *ourtNs udment,
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said remainin unpaid amount shall (ear the rate of interest set at twelvepercent %12S& per annum computed from the date of said notice. *ostsaainst petitioners.

SO ORERE.

G.R. No. the first (uyer in a prior sale that wasunrecorded, or the second (uyer who purchased the land in an e3ecution sale whose transfer wasreistered in the "eister of ;eeds.


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)he facts as found (y the *ourt of Appeals are as followsC

8n April 1=, 197, defendant spouses nri'ue *astro and Berminia ". *astro sold toplaintiff$appellee anuelito Palileo %private respondent herein&, a parcel ofunreistered coconut land situated in *andiis, ansayaw, ainit, !uriao del +orte.)he sale is evidenced (y a notari#ed ;eed of A(solute !ale %3h.


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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 supportpetitioners alleation that the document is fictitious or simulated. Dith this in mind, De see noreason to reect the conclusion of the *ourt of Appeals that private respondent was not a mereadministrator of the property. )hat he e3ercised acts of ownership throuh his mother also remainsundisputed.

:oin now to the third assined error which deals with the main issue presented in the instantpetition, De o(serve that the *ourt of Appeals resolved the same in favor of private respondent dueto the followin reason6 what the Provincial !heriff levied upon and sold to petitioner is a parcel ofland that does not (elon to nri'ue *astro, the udment de(tor, hence the e3ecution is contrary tothe directive contained in the writ of e3ecution which commanded that the lands and(uildins beonging to *nrique 0astro (e sold to satisfy the e3ecution. ;

)here is no dou(t that had the property in 'uestion (een a reistered land, this case would have(een decided in favor of petitioner since it was petitioner that had its claim first recorded in the"eistry of ;eeds. or, as already mentioned earlier, it is the act of reistration that operates toconvey and affect reistered land. )herefore, a bona fidepurchaser of a reistered land at an

e3ecution sale ac'uires a ood title as aainst a prior transferee, if such transfer was unrecorded.

Bowever, it must (e stressed that this case deals with a parcel of unreistered land and a differentset of rules applies. De affirm the decision of the *ourt of Appeals.

4nder Act +o. ==--, reistration of instruments affectin unreistered lands is


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G.R. No. 1544


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8n 8cto(er 2, 19?2, @a#ardo )aTedo e3ecuted a notari#ed deed ofa(solute sale in favor of his eldest (rother, "icardo )aTedo, and the latterNswife, )eresita /arera, private respondents herein, where(y he conveyed tothe latter in consideration of P1,5., Qone hectare of whatever share shallhave over @ot +o. 191 of the cadastral survey of :erona, Province of )arlacand covered (y )itle )$l=29 of the "eister of ;eeds of )arlac,R the saidproperty (ein his Qfuture inheritanceR from his parents %3h. 1&. 4pon thedeath of his father atias, @a#aro e3ecuted an QAffidavit of *onformityRdated e(ruary 2, 19 %3h. =& to Qre$affirm, respect. ac0nowlede andvalidate the sale made in 19?2.R 8n January 1=, 191, @a#aro e3ecutedanother notari#ed deed of sale in favor of private respondents coverin hisQundivided 8+ )D@V %1M12& of a parcel of land 0nown as @ot 191 3 3%3h. -&. Be ac0nowleded therein his receipt of P 1,. as considerationtherefor. n e(ruary 191, "icardo learned that @a#aro sold the sameproperty to his children, petitioners herein, throuh a deed of saledated ;ecem(er 29, 19 %3h. &. 8n June 7, 192, private respondentsrecorded the ;eed of !ale %3h. -& in their favor in the "eistry of ;eeds andthe correspondin entry was made in )ransfer *ertificate of )itle +o. 1??-51%3h. 53.

Petitioners on July 1?, 192 filed a complaint for rescission %plusdamaes& of the deeds of sale e3ecuted (y @a#aro in favor of privaterespondents 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, 19 %3it. &, conveyin to his ten children hisallotted portion under the e3traudicial partition e3ecuted (y the heirs ofatias, which deed included the land in litiation %@ot 191&.

Petitioners also presented in evidenceC %1& a private writin purportedlyprepared and sined (y atias dated ;ecem(er 2, 197, statin that it washis desire that whatever inheritance @a#aro would receive from him should (eiven to his %@a#aroNs& children %3h. A&6 %2& a typewritten document datedarch 1, 1979 sined (y @a#aro in the presence of two witnesses, whereinhe confirmed that he would voluntarily a(ide (y the wishes of his father,atias, to ive to his %@a#aroNs& children all the property he would inherit from

the latter %3h. /&6 and %=& a letter dated January 1, 19 of @a#aro to hisdauhter, *armela, statin that his share in the e3traudicial settlement of theestate of his father was intended for his children, petitioners herein %3h. *&.

Private respondents, however presented in evidence a Q;eed of"evocation of a ;eed of !aleR dated arch 12, 191 %3h. ?&, wherein @a#aro


35/51

revo0ed the sale in favor of petitioners for the reason that it was Qsimulated orfictitious $ without any consideration whatsoever.R

!hortly after the case a quo was filed, @a#aro e3ecuted a sworn statement%3h. :& which virtually repudiated the contents of the ;eed of "evocation of

a ;eed of !ale %3h. ?& and the ;eed of !ale %3h. -& in favor of privaterespondents. 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 ofhis children after ivin him five pesos %P5.& to (uy a Qdrin0R %)!+!eptem(er 1, 195, pp. 2-$25&.

)he trial court decided in favor of private respondents, holdin thatpetitioners 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=, 191 %3h. 9& was valid andthat its reistration in ood faith vested title in said respondents.

T% Iu%

Petitioners raised the followin QerrorsR in the respondent *ourt, whichthey also now allee in the instant PetitionC

# 2he trial ourt erred in onluding that the 4ontrat of %ale of Oto&er /+, 017/

IE"hi&it 8, !nswerJ is merely voida&le or annula&le and not void ab initiopursuant to

paragraph / of !rtile 0*


36/51

1. s the sale of a future inheritance validK

2. Das the su(se'uent e3ecution on January 1=, 191 %and reistration with the"eistry of Property& of a deed of sale coverin the same property to the same(uyers validK

=. ay this *ourt review the findins of the respondent *ourt %a& holdin that the

(uyers acted in ood faith in reisterin the said su(se'uent deed of sale and %(& inQfailin to consider petitionersN evidenceRK Are the conclusions of the respondent*ourt Qilloical and off$tanentRK

T% Cour& Ru(n

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 alleedlycommitted (y the respondent *ourt of Appeals and not directly those of the

trial court, which is not a party here. )he Qassinment of errorsR in the petition'uoted a(ove are therefore totally misplaced, and for that reason, the petitionshould (e dismissed. /ut in order to ive the parties su(stantial ustice wehave 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 theyare relevant to the appellate courtNs assailed ;ecision and "esolution.

)he sale made in 19?2 involvin future inheritance is not really at issuehere. n conte3t, the assailed ;ecision conceded Qit may (e leally correct thata contract of sale of anticipated future inheritance is null and void.R=

/ut to remove all dou(ts, we here(y cateorically rule that, pursuant toArticle 1=-7 of the *ivil *ode, Q%n&o contract may (e entered into upon afuture inheritance e3cept in cases e3pressly authori#ed (y law.R

*onse'uently, said contract made in 19?2 is not valid and cannot (e thesource of any riht nor the creator of any o(liation (etween the parties.

Bence, the Qaffidavit of conformityR dated e(ruary 2, 19, insofar as itsouht to validate or ratify the 19?2 sale, is also useless and, in the words ofthe respondent *ourt, Qsuffers from the same infirmity.R ven privaterespondents 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=, 191 in favor of private respondentscoverin @a#aroNs undividedinheritance of one$twelfth %1M12& share in @ot +o.191, which was su(se'uently reistered on June 7, 1926 and %(& the deed ofsale dated ;ecem(er 29, 19 in favor of petitioners coverin the sameproperty. )hese two documents were e3ecuted after the death of atias %and
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his spouse& and after a deed of e3traudicial settlement of his %atiasN& estatewas e3ecuted, thus vestin in @a#aro actual title over said property. n otherwords, these dispositions, thouh conflictin, were no loner infected with theinfirmities of the 19?2 sale.

Petitioners contend that what was sold on January 1=, 191 was only one$half hectare out of @ot +o. 191, citin as authority the trial courtNs decision. Asearlier pointed out, what is on review in these proceedins (y this *ourt is the*ourt of AppealsN decision $ which correctly identified the su(ect matter of theJanuary 1=, 191 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, 19 infavor of petitioners.

*ritical in determinin which of these two deeds should (e iven effect isthe reistration of the sale in favor of private respondents with the reister ofdeeds on June 7, 192.

Article 15-- of the *ivil *ode overns the preferential rihts of vendees incases of multiple sales, as followsC

!rt 0)


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As to third issue, while petitioners conceded the fact of reistration, theynevertheless contended that it was done in (ad faith. 8n this issue, therespondent *ourt ruledC

3nder the seond assignment of error, plaintiffs5appellants ontend that defendants5

appellees ated in &ad faith when they registered the $eed of %ale in their favor asappellee Riardo already =new of the e"eution of the deed of sale in favor of the

plaintiffs- appellants ite the testimony of plaintiff 9elinda 2afledo to the effet that

defendant Riardo 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 ontrat of sale &etween our father

and us were IsiJ already onsumatedB Ipp 150+, tsn, .anuary 7, 01?


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5. )he respondent *ourt erred in not ivin credence to petitionersN evidence,especially @a#aro )aTedoNs !inumpaang !aaysay dated July 27, 192 statin that"icardo )aTedo deceived the former in e3ecutin the deed of sale in favor of privaterespondents.

)o (e sure, there are indeed many conflictin documents and testimonies

as well as aruments over their pro(ative value and sinificance. !uffice it tosay, however, that all the a(ove contentions involve 'uestions of fact,appreciation of evidence and credi(ility of witnesses, which are not proper inthis review. t is well$settled that the !upreme *ourt is not a trier of facts. npetitions 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 orcapricious e3ercise of udment, and unless the lac0 of any (asis for theconclusions made (y the lower courts (e amply demonstrated, the !upreme*ourt will not distur( their findins. At most, it appears that petitioners haveshown 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 evidencepresented (y private respondents. /ut this in itself is not a reason for settinaside such findins. De are far from convinced that (oth courts ravelya(used their respective authorities and udicial preroatives.

As held in the recent case of 0hua 4iong 4ay vs. 0ourt of +ppeas and'oidrock 0onstruction and eveopment 0orp.67

2he 4ourt has onsistently held that the fatual findings of the trial ourt, as well as

the 4ourt of !ppeals, are final and onlusive and may not &e reviewed on appeal

!mong the e"eptional irumstanes where a reassessment of fats found &y thelower ourts is allowed are when the onlusion is a finding grounded entirely on

speulation, surmises or on(etures- when the inferene made is manifestly a&surd,

mista=en or #mpossi&le- when there is grave a&use of disretion in the appreiation of

fats- when the (udgment is premised on a misapprehension of fats- 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 &enh,

we find none of the a&ove grounds present to (ustify the re5evaluation of the findings

of fat made &y the ourts &elowL

n the same vein, the rulin in the recent case of !outh !ea !urety and(nsurance 0ompany, (nc. vs. on. 0ourt of +ppeas, et a.EFis e'uallyapplica(le to the present caseC

We see no valid reason to disard the fatual onlusions of the appellate ourt " " "

I#Jt is not the funtion of this 4ourt to assess and evaluate all over again the evidene,

testimonial and doumentary, addued &y the parties, partiularly where, suh as
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here, the findings of both the trial court and the appellate court on the matter

coincide. Iitalis suppliedJ

HEREFORE, the petition is ENIEand the assailed ;ecision of the*ourt of Appeals is AFFIR!E. +o *osts.

SO ORERE.

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

SOUSES TO!AS OCCEA an" SILINA OCCEA,etitioners, -s.LDIA !ORALES OBSIANA ESONILLA, ELSA !ORALESOBSIANA SALAAR an" ARFROSA OBSIANA SALAARESONILLA, resondents.

E C I S I O N

UNO, J.

)he case at (ar involves a portion of the 1,19$s'uare meter residential lot%lot no. 2?5& situated in !i(alom, Anti'ue, oriinally owned (y spouses +icolasand rene )ordesillas under 8*) +o. 11=. )he )ordesillas spouses hadthree %=& children, namelyC Barod, Anela and "osario, the latter havin (eensurvived (y her two %2& children, Arnold and @ilia de la lor.

After the death of the )ordesillas spouses, the lot was inherited (y theirchildren Barod and Anela, and randchildren Arnold and @ilia. n 1951, theheirs e3ecuted a %%" o$ Pacto de etroSa(%E1Fn $a3or o$ A('%r&a !ora(%0o3%rn &% ou&+%&%rn *or&on o$ &% (o& +& an ar%a o$ 74< uar%

/%&%r.)hree %=& years later, in 19;4, Arnold and @ilia e3ecuted a %%" o$

%$n&% Sa(% o$ Sar%, R&, In&%r%& an" ar&0*a&on E2Fo3%r &%a/% 74< . /. (o& n $a3or o$ A('%r&a!ora(%. )he notari#ed deed alsoattested that the lot sold (y vendors Arnold and @ilia to Al(erta were theirshare in the estate of their deceased parents.
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(een sold to Al(erta orales in 195-. )hey averred that (efore the sale,when )omas 8cceTa conducted an ocular inspection of the lots, orito A(as,the careta0er appointed (y Al(erta orales to oversee her property, warnedthem not to push throuh with the sale as the land was no loner owned (yvendor Arnold as the latter had previously sold the lot to Al(erta orales whohad a house constructed thereon.

or their part, the 8cceTa spouses claimed that the 8*) in the name ofthe oriinal owners of the lots, the )ordesillas spouses, was cancelled after itwas su(divided (etween Anela and Arnold in 19?96 that new )*)s had (eenissued in the latterNs names6 that they were unaware that the su(ect lots werealready previously sold to orales as they denied that )omas had a tal0 withcareta0er A(as on the matter6 that as of ;ecem(er -, 197, the )*)scoverin the lots were in the name of Arnold and his wife, without any adverseclaim annotated thereon6 that vendor Arnold represented to them that the

occupants they saw on the land were s'uatters and that he merely toleratedtheir presence6 that &%y "" no& *%rona((y n3%&a&% &% a((%%"ua&&%r on &% (an" an" /%r%(y r%(%" on &% r%*r%%n&a&on o$ 3%n"orArno("that sometime in 19??$19?7, Arnold and his co$heir Anela causedthe survey of the oriinal lot and su(divided it into = lots, without oppositionfrom orales or her heirs. )hus, three %=& )*)s were issued in 19?9 to

Arnold and Anela and, two of the lots were then sold to the 8cceTa spouses,aain without o(ection from Al(erta orales.

)he 8cceTa spouses alleed that they were (uyers in ood faith as the

titles to the su(ect lots were free from liens or encum(rances when theypurchased them. )hey claimed that in 199,Arnold offered to sell the su(ectlots to them. 8n Auust 1=, 199, after they verified with the Anti'ue "eistryof ;eeds that ArnoldNs )*)s were clean and unencum(ered, Arnold sinedthe instrument of sale over the su(ect lots in favor of the 8cceTasfor P1,. and new titles were issued in their names.

)he 8cceTas li0ewise set up the defenses of laches andprescription. )hey arue that Al(erta and plaintiffs$heirs were (arred fromprosecutin their action as they failed to assert their riht for forty %-&years. irstly, they point out that vendor Arnold and Anela su(divided the

entire lot in 19?? and declared themselves as the only co$owners thereof inthe deed of e3traudicial settlement. Al(erta orales failed to oppose theinclusion of her 7- s'. m. lot in the deed. )hus, the title to the entire lot no.25? was transferred to the names of Arnold and Anela. !econdly,preparatory to the division of the lots, vendor Arnold had the land surveyed(ut Al(erta aain failed to oppose the same. inally, Al(erta and her heirswho are claimin adverse rihts over the land (ased on the 1951 ;eed of


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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 Arnoldand Anela, ena(lin the latter to possess a clean title and transfer them tothe 8cceTa spouses.

After trial, the lower court rendered a decision declarin the 8cceTaspouses as (uyers in ood faith and ruled that the action of the heirs wastime$(arred.

8n appeal (y Al(ertaNs heirs, the *ourt of Appeals reversed the decisionof the trial court. t found that the 8cceTas purchased the land in (ad faithand that the action filed (y Al(ertaNs heirs was not (arred (y prescription orlaches. )he dispositive portion readsC

WHEREFORE,the instant appeal is here&y GRANTED !ordingly, the assailed

deision is here&y REVERSEDand SET ASIDEand a new one is rendered

delaring the $eed of !&solute %ale dated !ugust 0*, 011+ e"euted &etween !rnold

de la Flor in favor of defendants5appellees null and void and ordering the anellation

of 2ransfer 4ertifiate of 2itle Nos 07?17, 07?18, 250?/


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B ALBERTA MORALES, TO PROTECT THEIR INTEREST CAN BE

CONSIDERED LACHES AND THUS THEIR PRESENT ACTION HAS

PRESCRIBED.

8n the $r&&+ou%, petitioner$spouses claim that they werepurchasers of the land in ood faith as the law does not o(liate them to o(eyond a clean certificate of title to determine the condition of theproperty. )hey arue that a person dealin with reistered land is onlychared with notice of the (urden on the property annotated on thetitle. Dhen there is nothin on the title to indicate any cloud or vice in theownership of the property or any encum(rance thereon, the purchaser is notre'uired to e3plore further than the title in 'uest of any hidden defect orinchoate riht that may su(se'uently defeat his riht thereto. )hey claim theyhad every riht to purchase the land despite the ver(al warnin made (ycareta0er A(as as the information was mere hearsay and cannot prevail overthe title of the land which was free from any encum(rance.

)heir aruments do not persuade.

)he petition at (ar presents a case of dou(le sale of an immova(leproperty. Article 15-- of the +ew *ivil *ode provides that in case animmova(le property is sold to different vendees, the ownership shall (elonC%1& to the person ac'uirin it +o n oo" $a& $r& r%0or"%" &in the"eistry of Property6 %2& should there (e no inscription, the ownership shallpertain to &% *%ron +o n oo" $a& +a $r& n *o%on and, %=& inthe a(sence thereof, to the person who presents the oldest title, providedthere is ood faith.

n all cases, ood faith is essential. t is the (asic premise of thepreferential rihts ranted to the one claimin ownership over an immova(le.E9FDhat is material is whether the second (uyer first reisters the second salein ood faith, i.e.,without 0nowlede of any defect in the title of the propertysold.E1F)he defense of indefeasi(ility of a )orrens title does not e3tend to atransferee who ta0es the certificate of title in (ad faith, with notice of a flaw. E11F

)he overnin principle ofprius tempore, potior ure %first in time, stroner

in riht& enunciated under Art. 15-- has (een clarified, thusC

" " " Gnowledge &y the first &uyer of the seond sale annot defeat the first &uyerBs

rights e"ept when the seond &uyer first registers in good faith the seond

sale (Olivares vs. Gonzales, 5! "C#A $$%. 4onversely,'(ow)e*+e +i(e* - the

se/o(* -0er o1 the 1irst s)e *e1ets his ri+hts e2e( i1 he is 1irst to re+ister, si(/e

s0/h '(ow)e*+e ti(ts his re+istrtio( with -* 1ith Isee alsoAstorga vs. Court

of Appeals, G.#. &o. 5'5$, )* +ecember !'%. #n Cruz vs. Caba-aI6R No
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)7/*/, // .une 01?


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property in litiation. 8ne who falls within the e3ception can neither (edenominated an innocent purchaser for value nor a purchaser in ood faith.E15F

)he evidence of the private respondents show that when )omas 8cceTaconducted an ocular inspection of the land prior to the second sale, A(as, the

careta0er of the house which Al(erta orales (uilt on the land, personallyinformed )omas that the lot had (een previously sold (y the same vendor

Arnold to Al(erta orales. Dith this information, the 8cceTas were o(lied toloo0 (eyond the title of their vendor and ma0e further in'uiries from theoccupants of the land as to their authority and riht to possess it. Bowever,despite this information a(out a prior sale, the 8cceTas proceeded with thepurchase in haste. )hey did not in'uire from A(as how they could et intouch with the heirs or representatives of Al(erta to verify the ownership of theland. +either do the records reveal that they e3erted effort to e3amine thedocuments 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 actualpossession thereof, it was incum(ent upon the petitioners to verify the e3tentof the occupantNs possessory rihts. E1?F)he 8cceTas did nothin and chose toinore and dis(elieve A(asN statement.

8n the &r" u%,we hold that the action to annul title filed (yrespondents$heirs is not (arred (y laches and prescription. Fr&(y,laches isa creation of e'uity and its application is controlled (y e'uita(leconsiderations. @aches cannot (e used to defeat ustice or perpetuate fraudand inustice. +either should its application (e used to prevent the rihtful

owners of a property from recoverin what has (een fraudulently reistered inthe name of another.E17FS%0on"(y,prescription does not apply when theperson 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. E1Fnthis case, orales had actual possession of the land when she had a house(uilt thereon and had appointed a careta0er to oversee her property. Berundistur(ed possession of the land for a period of fifty %5& lon years aveher and her heirs a continuin riht to see0 the aid of a court of e'uity todetermine the nature of the claim of ownership of petitioner$spouses.E19FAs held(y this *ourt in Fa>a 3. Cour& o$ A**%a(CE2F

" " " 2here is settled (urisprudene that o(e who is i( /t0) 4ossessio( o1 4ie/e

o1 )(* /)i3i(+ to -e ow(er thereo1 3 wit 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 reso( 1or the r0)e

-ei(+, tht his 0(*ist0r-e* 4ossessio( +i2es hi3 /o(ti(0i(+ ri+ht to see' the

i* o1 /o0rt o1 e70it to s/erti( (* *eter3i(e the (t0re o1 the *2erse

/)i3 and its effet on his own title, whih right an &e laimed only &y one who is in
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possession " " " The ri+ht to 'uiet title to the property, see= its reonveyane

and ((0) ( /erti1i/te o1 tit)e /o2eri(+ it //r0e* o() 1ro3 the ti3e the o(e i(

4ossessio( ws 3*e wre o1 /)i3 *2erse to his ow(, (* it is o() the( tht

the stt0tor 4erio* o1 4res/ri4tio( /o33e(/es to r0( +i(st s0/h 4ossessor.

n the case at (ar, oralesN careta0er (ecame aware of the second sale topetitioner$spouses only in 1991 when he received from the latter a notice tovacate the land. "espondents$heirs did not sleep on their rihts for in 199-,they filed their action to annul petitionersN title over the land. t li0ewise (earsto stress that when vendor Arnold reac'uired title to the su(ect property (ymeans of fraud and concealment after he has sold it to Al(erta orales, aconstructive trust was created in favor of orales and her heirs. As thedefrauded parties who were in actual possession of the property, an action ofthe respondents$heirs to enforce the trust and recover the property cannotprescri(e. )hey may vindicate their riht over the property reardless of thelapse of time.E21FBence, the rule that reistration of the property has the effect ofconstructive notice to the whole world cannot (e availed of (y petitioners andthe defense of prescription cannot (e successfully raised aainstrespondents.

n sum, the eneral rule is that reistration under the )orrens system is theoperative 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 0nowledeof the claimantNs actual, open and notorious possession of the property at thetime of his reistration.E22F A (uyer in (ad faith has no riht over the land. As

petitioner$spouses failed to reister the su(ect land in ood faith, ownershipof the land pertains to respondent$heirs who first possessed it in ood faith.

IN IE HEREOF, the petition is ;!!!;. +o costs.

SO ORERE.
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ABELARO CRU @"%0%a%" u'&&u&%" 'y H%r Conu%(o C. Cru8, C(aro C. Cru8 an"S&%*%n C. Cru8, *%r R%o(u&on, petitioners,vs.LEOEGARIA CABANA, TEOFILO LEGASI , ILU!INAA CABANA an" THE HONOR- ABLE

COURT OF AEALS,P respondents.

:aareno, +ada, !abado ion for petitioners.

Fei-berto :.


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sold the land to defendants$spouses on 8cto(er 21, 19?. Plaintiff was a(le toreister the land in his name on e(ruary 9, 1971 %3h. A&. Dith the admission of(oth parties that the land in 'uestion was sold to two persons, the main issue to (eresolved 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 riht of repurchase on

June 1, 19?5 to defendants$ spouses )eofilo @easpi and luminada *a(ana %3h.1&. )he said document /ilihan ulin a(i(ili stipulated that the land can (erepurchased (y the vendor within one year from ;ecem(er =1, 19?? %see par. 5,3h. 1&.wph=it>!aid land was not repurchased and in the meantime, however, saiddefendants$spouses too0 possession of the land.

4pon re'uest of @eodearia *a(ana, the title of the land was lent to her in order tomortae the property to the Philippine +ational /an0. !aid title was, forthwith,deposited with the P+/. 8n 8cto(er 21, 19?, defendant @eodearia *a(ana soldthe land (y way of a(solute sale to the defendants$ spouses %3h. 2&. Bowever, on+ovem(er 29, 19? defendant sold the same property to herein plaintiff and the latterwas a(le to reister it in his name.

)he transaction in 'uestion is overned (y Article 15-- of the *ivil *ode. )rue it isthat the plaintiff was a(le to reister the sale in his name (ut was he in ood faith indoin soK

Dhile the title was reistered in plaintiff$ appellants name on e(ruary 9, 1971 %3h.A&, it appears that he 0new of the sale of the land to defendants$spouses @easpi ashe was informed in the 8ffice of the "eister of ;eeds of Hue#on. t appears that thedefendants$spouses reistered their document of sale on ay 1=, 19?5 underPrimary ntry +o. 2111= of the "eister of ;eeds %3h. 2&.

4nder the foreoin circumstances, the riht of ownership and title to the land must(e resolved in favor of the defendants

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