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6 Naawan Community vs. CA (2003)
6 Naawan Community vs. CA (2003)
CA & SPOUSES LUMO Spouses Lumo thus instituted an action for quieting of title and obtained a favorable
The Land Registration Commission & Its Register of Deeds decision in the RTC and CA. Hence this, petition by Nawaan Bank.
January 13, 2003 | Corona, J.
W/N Naawan Bank’s earlier registration of the sheriff’s deed of final conveyance in
Summary: Wanting to buy the property that Comayas was selling, Spouses Lumo the day book under Act 3344 should prevail over the later registration of Spouses
inquired at the Register of Deeds of CDO and the Bureau of Lands on the legal status of Lumo’s deed of absolute sale under Act 496, as amended by PD 1529 – NO
the vendor’s title. It found that it was mortgaged to one Galupo and directed Comayas to Where a person claims to have superior proprietary rights over another on the ground
redeem the same at their expense. After a deed of absolute sale was issued by that he derived his title from a sheriff’s sale registered in the Registry of Property,
Comayas in their favor and when they were requesting to be issued a tax declaration in Article 1544 of NCC will apply only if said execution sale of real estate is registered
their names, they were surprised to find out that a tax declaration was already issued in under Act 496.
the name of Nawaan Bank. Nawaan obtained its title when Comayas failed to redeem Here, the subject property was still untitled when it was acquired by Naawan Bank by
the property foreclosed when he defaulted in the payment of his loan to Nawaan. It virtue of a final deed of conveyance. On the other hand, when Spouses Lumo
turned out that while the subject property was still untitled when it was acquired by purchased the same property, it was already covered by the Torrens System.
Naawan Bank by virtue of a final deed of conveyance, when Spouses Lumo purchased At the time of the execution and delivery of the sheriff’s deed of final conveyance on
the same property, it was already covered by the Torrens System. In an action to quiet September 5, 1986, the disputed property was already covered by the Land
title, RTC, CA, and SC all declared that Spouses Lumo’s registration in good faith under Registration Act and OCT No. 0-820 was already entered in the registration book of
Act 496 as amended by PD 1529 prevailed over that of Nawaan Bank. the Register of Deeds of CDO as of April 17, 1984. Thus, from April 17, 1984, the
subject property was already under the operation of the Torrens System.
Doctrine: A person dealing with registered land may generally rely on the correctness of Under the said system, registration is the operative act that gives validity to the
a certificate of title and the law will in no way oblige him to go beyond it to determine the transfer or creates a lien upon the land. The issuance of a certificate of title had the
legal status of the property. effect of relieving the land of all claims except those noted thereon.
Accordingly, Spouses Lumo, in dealing with the subject registered land, were not
Facts: required by law to go beyond the register to determine the legal condition of the
Wanting to buy the 340-square-meter house and lot in CDO that Comayas was property. They were only charged with notice of such burdens on the property as were
selling, Spouses Lumo inquired at the Register of Deeds of CDO and the Bureau of noted on the register or the certificate of title. To have required them to do more would
Lands on the legal status of the vendor’s title and found out that it was mortgaged for have been to defeat the primary object of the Torrens System which is to make the
P8k to a certain Galupo who was in possession of the owner’s copy of the certificate Torrens Title indefeasible and valid against the whole world.
of title.
They directed Comayas to settle the mortgage with Galupo for P10k at their expense W/N Spouses Lumo exercised the required diligence in ascertaining the legal
and, after paying P30k as down payment, Comayas executed a Deed of Absolute condition of the title to the subject property so as to be considered as innocent
Sale which was registered. Spouses Lumo obtained a TCT in their favor. purchasers for value and in good faith – YES
However, when they requested the issuance of a tax declaration in their names, they Under the Torrens system, any person dealing with registered land have the legal
found out that the property was also declared for tax purposes in the name of Nawaan right to rely on the face of the Torrens Certificate of Title and to dispense with the
Community Bank. need to inquire further, except when the party concerned has actual knowledge of
o It was revealed that Comayas obtained a P15k loan from Nawaan Bank secured facts and circumstances that would impel a reasonably cautious man to make such
by the same property. inquiry.
o At the time said contract of mortgage was entered into, the subject property was Here, before buying the property, Spouses Lumo inquired before the Register of
then an unregistered parcel of residential land, tax-declared in the name of one Deeds and Bureau of Lands regarding the status of the vendor’s title and found no
Balibay while the residential one-storey house was tax-declared in the name of lien or encumbrance to have been annotated on the title. Neither were they aware of
Comayas. any adverse claim or lien on the property other than that of a Galupo, which has
o Balibay executed a SPA authorizing Comayas to borrow money and use the already been settled and the adverse claim, cancelled.
subject lot as security. But the Deed of Real Estate Mortgage and the SPA were Having made the necessary inquiries, Spouses Lumo did not have to go beyond the
recorded in the registration book of the Province of Misamis Oriental, not in the certificate of title. Otherwise, the efficacy and conclusiveness of the Torrens
registration book of CDO because when the registration was made, there was Certificate of Title would be rendered futile and nugatory.
only one Register of Deeds for the entire province of Misamis Oriental, including
CDO. It was only in1985 when the Office of the Register of Deeds for CDO was Ruling: Petition is hereby DENIED.
established.
o Upon defaulting, the security was foreclosed and awarded to Nawaan Bank as
highest bidder, and a sheriff’s certificate of sale was issued in Nawaan Bank’s
favor and registered under Act 3344. For Comayas’ failure to redeem, a deed of
final conveyance was likewise issued.
Nawaan instituted an action for ejectment against Spouses Lumo and obtained
favorable judgment. When judgment was about to be executed, they found out that
the property was already occupied by Spouses Lumo.