Adverse Claims Doctrine

“Construing the provision as a whole would reconcile the apparent inconsistency between the
portions of the law such that the provision on cancellation of adverse claim by verified petition
would serve to qualify the provision on the effectivity period. The law, taken together, simply
means that the cancelation of the adverse claim is still necessary to render it ineffective,
otherwise, the inscription will remain annotated and shall continue as a lien upon the property.
For if the adverse claim has already ceased to be effective upon the lapse of the period, its
cancelation is no longer necessary and the process of cancellation would be a useless ceremony”
(Sajonas vs. CA, G.R. No. 102377, July 5, 1996
January 11, 2016
G.R. No. 206584
MAE FLOR GALIDO, Petitioner,

vs.
NELSON P. MAGRARE, EVANGELINE M. PALCAT, RODOLFO BAYOMBONG, and
REGISTER OF DEEDS OF ANTIQUE, San Jose, Antique, Respondents.
Ruling:
Prior Registered Adverse Claims Prevail
The parcels of land involved in this case are registered under the Torrens system. One who deals
with property registered under the Torrens system need not go beyond the certificate of title, but
only has to rely on the certificate of title.44 Every subsequent purchaser of registered land
taking a certificate of title for value and in good faith shall hold the same free from all
encumbrances except those noted on said certificate and any of the encumbrances provided
by law.45
The Property Registration Decree46 provides:
Section 51. Conveyance and other dealings by registered owner. An owner of registered land
may convey, mortgage, lease, charge or otherwise deal with the same in accordance with existing
laws. He may use such forms of deeds, mortgages, leases or other voluntary instruments as are
sufficient in law. But 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,
but shall operate only as a contract between the parties and as evidence of authority to the
Register of Deeds to make registration.
The act of registration shall be the operative act to convey or affect the land insofar as third
persons are concerned, and in all cases under this Decree, the registration shall be made in the
office of the Register of Deeds for the province or city where the land lies.1âwphi1
Section 52. Constructive notice upon registration. Every conveyance, mortgage, lease, lien,
attachment, order, judgment, instrument or entry affecting registered land shall, if registered,
filed or entered in the office of the Register of Deeds for the province or city where the land to
which it relates lies, be constructive notice to all persons from the time of such registering,
filing or entering.
The adverse claims were registered on the respective titles on 6 February 2001, at 11:00 in the
morning. They were already in existence when petitioner filed her case for foreclosure of
mortgage. In fact, when petitioner registered the mortgages on 6 February 2011 at 3:00 in the
afternoon, she was charged with the knowledge that the properties subject of the mortgage
were encumbered by interests the same as or better than that of the registered owner.
Petitioner does not hide the fact that she was aware of the adverse claim and the proceedings in
Civil Case No. 2001-2-3230. In her petition before the Court, she stated that "on March 03, 2004,
petitioner had filed a third party claim with the Regional Trial Court, Branch 11 in said Civil
Case No. 2001-2-3230."47
Instead, petitioner insists that it was illegal for Magrare, Palcat and Bayombong to file a case
compelling the surrender of the owner’s duplicates of TCT Nos. T-22374, T-22375 and T-22376.
On the contrary, the law itself provides the recourse they took – registering an adverse claim and
filing a petition in court to compel surrender of the owner’s duplicate certificate of title:
Sec. 70. Adverse claim. Whoever claims any part or interest in registered land adverse to the
registered owner, arising subsequent to the date of the original registration, may if no other
provision is made in this Decree for registering the same, make a statement in writing setting
forth fully his alleged right or interest, and how or under whom acquired, a reference to the
number of the certificate of title of the registered owner, the name of the registered owner, and a
description of the land which the right or interest is claimed.
xxxx
Sec. 107. Surrender of withheld duplicate certificates. Where it is necessary to issue a new

certificate of title pursuant to any involuntary instrument which divests the title of the registered
owner against his consent or where a voluntary instrument cannot be registered by reason of the
refusal or failure of the holder to surrender the owner’s duplicate certificate of title, the party in
interest may file a petition in court to compel surrender of the same to the Register of Deeds. The
court, after hearing, may order the registered owner or any person withholding the duplicate
certificate to surrender the same, and direct the entry of a new certificate or memorandum upon
such surrender. If the person withholding the duplicate certificate is not amenable to the process
of the court, or if for any reason the outstanding owner’s duplicate certificate cannot be
delivered, the court may order the annulment of the same as well as the issuance of a new
certificate of title in lieu thereof. Such new certificate and all duplicates thereof shall contain a
memorandum of the annulment of the outstanding duplicate.
Further, RTC Branch 11, after trial on the merits of Civil Case No. 2001-2-3230, found for
Magrare, Palcat and Bayombong. That decision has attained finality and was entered in the Book
of Judgments. The trial court was correct in not touching upon the final and executory decision
in that case.
Petitioner is not a Buyer in Good Faith
But even assuming that the mortgage was valid, petitioner can hardly be considered a buyer in
good faith. A purchaser in good faith and for value is one who buys the 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 claims or
interest of some other person in the property.48
As discussed above, petitioner had notice as early as 2001 of the adverse claims of Magrare,
Palcat and Bayombong. The decision in Civil Case No. 2001-2-3230 became final and
executory before the Certificate of Sale was issued by the Provincial Sheriff on 14 July 2004 in
Civil Case No. 3345.
Without speculating as to petitioner’s motivations in foreclosing on the mortgage, the law on the
matter is clear. Preference is given to the prior registered adverse claim because registration
is the operative act that binds or affects the land insofar as third persons are
concerned.49 Thus, upon registration of respondents’ adverse claims, notice was given the whole
world, including petitioner.

Adverse Claims Doctrine

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Adverse Claims Doctrine

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“Construing the provision as a whole would reconcile the apparent inconsistency between the

January 11, 2016

G.R. No. 206584

MAE FLOR GALIDO, Petitioner,

Prior Registered Adverse Claims Prevail

The Property Registration Decree46 provides:

Sec. 107. Surrender of withheld duplicate certificates. Where it is necessary to issue a new

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