SALES ASSIGNMENT # 3 Petitioner Philippine Suburban Development Corporation, as owner and People’s Homesite

Articles 1495-1506; 1521-1544 and Housing Corporation (PHHC), as authorized by the President of the Philippines, entered
into a contract embodied in a public instrument entitled “Deed of Absolute Sale” whereby the
1. EDCA PUBLISHING VS. SPOUSES LEONOR 184 SCRA 614 former conveyed unto the latter the unoccupied portion of the Sapang Palay Estate. This was
not registered in the Office of the Register of Deeds until March 14, 1961, due to the fact,
Facts: petitioner claims, that the PHHC could not at once advance the money needed for registration
A man introducing himself as Professor Jose Cruz, placed an order by telephone with EDCA expenses. On April 12, 1961, the Provincial Treasurer of Bulacan requested the PHHC to
for 406 books, payable on delivery. EDCA prepared the corresponding invoice and delivered withhold the amount of P30,099.79 from the purchase price to be paid by it to the Philippine
the books as ordered, for which Cruz issued a personal check covering the purchase price of Suburban Development Corporation. Said amount represented the realty tax due on the
P8,995.65.Cruz sold 120 of the books to respondent Leonor Santos who, after verifying the property involved for the calendar year 1961. Petitioner, through the PHHC, paid under protest
seller’s ownership from the invoice he showed her, paid him P1, 700.00.Cruz ordered a 2nd the abovementioned amount and thereafter, by letter, requested then Secretary of Finance
set of books from EDCA before the clearance of the first check. EDCA, becoming suspicious, Dominador Aytona to order a refund of the amount so paid. Upon recommendation of the
called dlsu to confirm if Cruz is a Dean in that green school in taft. EDCA found out that Cruz Provincial Treasurer of Bulacan, said request was denied by the Secretary of Finance.
is not a Dean nor a professor in said “school” in taft. EDCA also found out that Cruz no longer
owns an account in the bank where he drew the check from.EDCA went to the police and the ISSUE:
police set up a trap for Cruz. Cruz got arrested and divulged that his real name is Tomas de la Whether or not there was already a valid transfer of ownership between the parties and thus
Peña and that he sold 120 books to the Santoses. On that same night, police forced their way petitioner is entitled for a refund.
into the Santos Bookstore and threatened Leonor Santos with prosecution for buying stolen
property. The police seized the 120 books without warrant and turned them over to EDCA. HELD:
Leonor Santos sued for recovery of the books. A writ of preliminary attachment was issued YES. There was already a valid transfer of ownership. Under the civil law, delivery (tradition)
and EDCA surrendered the books to the Santoses. EDCA contends that private respondents as a mode of transmission of ownership maybe actual (real tradition) or constructive
have not established their ownership of the disputed books because they have not even (constructive tradition). When the sale of real property is made in a public instrument, the
produced a receipt to prove they had bought the stock. Article 559 “the possession of movable execution thereof is equivalent to the delivery of the thing/object of the contract, if from the
property acquired in good faith is equivalent to a title”, thus dispensing with further proof. deed the contrary does not appear or cannot clearly be inferred. In other words, there is
Leonor Santos is a possessor in good faith. She even ascertained the ownership of Cruz/de la symbolic delivery of the property subject of the sale by the execution of the public instrument,
Peña of the books by checking the invoice EDCA gave to Cruz which she certainly was not unless from the express terms of the instrument, or by clear inference therefrom, this was not
obligated to do. the intention of the parties made. In the case at bar, there is no question that the vendor had
actually placed the vendee in possession and control over the thing sold, even before the date
Issue: of the sale. The condition that petitioner should first register the deed of sale and secure a new
W/N petitioner was unlawfully deprived of the books because the check issued by the title in the name of the vendee before the latter shall pay the balance of the purchase price, did
impostor in payment therefor was dishonored. not preclude the transmission of ownership. In the absence of an express stipulation to the
contrary, the payment of the purchase price of the good is not a condition precedent to the
Held: transfer of title to the buyer, but title passes by the delivery of the goods. It goes without
No. EDCA contends that there was no transference of ownership from them to Cruz.Art.1477 saying that the petitioner is entitled for a refund.
and Art. 1488 provide for the rule that in a contract of sale, ownership shall pass from the
vendor to the vendee upon actual/constructive delivery even if purchase price hasn’t been 3. SKUNAC CORPORATION VS. SYLIANTENG, 723 SCRA 625, G.R. NO.
given yet unless there is a stipulation to the contrary. Hence, Cruz became the rightful owner 205879 APRIL 23, 2014
of the books. In case of non-payment, the valid remedies are: right to rescission, right to
demand payment or right to sue in case of bouncing checks. The unlawful deprivation EDCA FACTS:
claims is not within the scope of Art 559 which states: “Nevertheless, one who has lost any The Sylianteng brothers, claims ownership of two parcels of land situated at Pujalte
movable or has been unlawfully deprived thereof, may recover it from the person in Subdivision, Greenhills, San Juan City. Their claims are based on the Deed of Absolute Sale
possession of the same. ”He was not “unlawfully deprived” as stated in Art 559 because in executed in favor of their mother. They allege that the said lots were acquired by their mother
fact, by virtue of the contracts of sale and deliverance, there was a valid transference of from Luis Pujalte, the previous owner of the property in dispute, as reflected and annotated in
ownership to Cruz. Cruz could have done whatever he wanted with the books. Cruz’s non- the TCT which was sold to them.
payment did not bring this case under the purview of Art 559.EDCA’s remedy is not against
Leonor but against Cruz/de la Peña. Petitioners, herein, claim that Romeo Pujalte was declared by the RTC of Pasig City as the
sole heir of Luis Pujalte, which eventually caused the reconstitution of the Mother Title
2. PHIL. SUBURBAN DEVELOPMENT CORP. VS. AUDITOR GENERAL, 63 resulting to its cancellation and the issuance of another TCT in his favor. Romeo Pujalte then
SCRA 397 sold the said properties to herein petitioners.

FACTS: [Respondents] contend that they have a better right to the lots in question because the
transactions conveying the same to them preceded those claimed by [petitioners] as source of
the latter’s titles. [Respondents] further assert that [petitioners] could not be considered as Certificate of Title because the Register of Deeds refused to annotate both deeds. Even after
innocent purchasers in good faith and for value because they had prior notice of the previous the success of Cattleya to have lifted the writ of attachment that was on the certificate of title
transactions as stated in thememorandum of encumbrances annotated on the titles covering the to the subject property, it has failed to register a title because the TCT (owner’s copy) was not
subject lots. [Petitioners], for their part, maintain that [respondents] acquired the lots under yet surrendered by the Tecson sps. According to Cattleya, the Tecson sps could not possibly
questionable circumstances it appearing that there was no copy of the Deed of Sale, between deliver the certificate for it had been destroyed in a fire.
Emerenciana and Luis Pujalte, on file with the Office of the Register of Deeds.
It turns out that the spouses could not deliver the certificate because it was already presented
ISSUES: to a previous sale to Taina Stone, a Filipina who married a foreigne r. The RTC found that
1. Whether the mother of the Sylianteng brothers validly acquired the subject lots from Luis. Taina was only a dummy in the contract of sale and that her subsequent marriage to the
2. Whether the respondents, in tuen, validly acquire the same lots from their mother. foreigner will not validate or legitimize the sale. Stone asserts that as long as the name
registered is a Filipino, the trial court is barred from inquiring into its legality.
RULING:
The Court rules in the affirmative, but takes exception to the CA’s and RTC’s application of ISSUE:
Article 1544 of the Civil Code. Whether the assailed Decision is legally correct in not applying the rules on double sale, which
clearly favor petitioner Taina.
Reliance by the trial and appellate courts on Article 1544 of the Civil Code is misplaced. The
requisites that must concur for Article 1544 to apply are: RULING:
The petition is bereft of merit.
(a) The two (or more sales) transactions must constitute valid sales;
(b) The two (or more) sales transactions must pertain to exactly the same subject matter; Petitioner’s arguments, which rest on the assumption that there was a double sale, must fail. In
(c) The two (or more) buyers at odds over the rightful ownership of the subject matter must the first place, there is no double sale to speak of. Art. 1544 of the Civil Code, which provides
each represent conflicting interests; and the rule on double sale, applies only to a situation where the same property is validly sold to
(d) The two (or more) buyers at odds over the rightful ownership of the subject matter must different vendees. In this case, there is only one sale to advert to, that between the spouses
each have bought from the very same seller. Tecson and respondent.

Obviously, said provision has no application in cases where the sales involved were initiated 5. SPRING HOMES SUBDIVISION CO., INC. VS. TABLADA, JR., 815 SCRA 114,
not by just one but two vendors. In the present case, the subject lots were sold to petitioners G.R. NO. 200009 JANUARY 23, 2017
and respondents by two different vendors – Emerenciana and Romeo Pujalte (Romeo). Hence,
Article 1544 of the Civil Code is not applicable. Nonetheless, the Court agrees with the FACTS:
findings and conclusion of the CA that Emerenciana’s acquisition of the subject lots from Luis Spouses Pedro L. Lumbres and Rebecca T. Roaring, (Spouses Lumbres) entered into a Joint
and her subsequent sale of the same to respondents are valid and lawful. Venture Agreement with Spring Homes Subdivision Co., Inc., through its chairman, the late
Mr. Rolando B. Pasic, for the development of several parcels of land consisting of an area of
Granting that both petitioners and respondents bought the disputed lots in good faith by simply 28,378 square meters. For reasons of convenience and in order to facilitate the acquisition of
relying on the certificates of the sellers, and subsequently, acquiring titles in their own names, permits and licenses in connection with the project, the Spouses Lumbres transferred the titles
respondents’ title shall still prevail. It is a settled rule that when two certificates of title are to the parcels of land in the name of Spring Homes.
issued to different persons covering the same land in whole or in part, the earlier in date must
prevail, and, in case of successive registrations where more than one certificate is issued over Spring Homes entered into a Contact to Sell with respondents, Sps. Tablada, for the sale of a
the land, the person holding a prior certificate is entitled to the land as against a person who parcel of land. The Sps. Lumbres filed with the RTC of Calamba City a complaint for
relies on a subsequent certificate.37 The titles of respondents, having emanated from an older Collection of Sum of Money, specific performance and damages with prayer for the issuance
title, should thus be upheld. of a Writ of Preliminary Attachment against Spring Homes for its alleged failure to comply
with the terms of the Joint Venture Agreement. Spring Homes executed a Deed of Absolute
Anent petitioners’ bad faith, this Court finds no persuasive reason to depart from the findings Sale in favor of Sps Tablada. The title over the subject property, however, remained with
of the CA that petitioners had prior knowledge of the estate proceedings involving the subject Soring Homes for its failure to cause the cancellation of the TCT and the issuance of a new
lots and that they have notice of the defect in the title of Romeo. one in favor of the Sps. Tablada.

4. MANIGQUE-STONE VS. CATTLEYA LAND, INC., 802 SCRA 173, G.R. NO. Sps Lumbres and Spring Homes entered into a Compromise agreement wherein spring homes
195975 SEPTEMBER 5, 2016 conveyed the subject property, as well as several others, to the sps. Lumbres. The latter started
collecting deficiency payments from the subdivision lot buyers. When no payment was
FACTS: received, the Sps lumbres caused the cancellation of the Contract to Sell previously executed
Cattleya Land, Inc., entered into a contract of conditional sale with the sps. Tecson covering 9 by Spring Homes in favor of sps tablada. The Lumbres’ and Spring Homes executed a Deed of
parcels of land including the subject property. The parties then executed a Deed of Absolute Absolute Sale over the subject property, and as a result, a new title was issued in the name of
Sale covering the subject property. However, neither of the two could be annotated on the the Lumbres’.
 imagination how spouses Lumbres can feign ignorance to the first sale when the records
The sps Lumbres filed an ejectment suit of their own before the MTCC of Calamba City clearly reveal that they even made numerous demands on the Spouses Tablada to pay, albeit
demanding the the Sps. Tablada vacate the subject property and pay rentals due thereon. The erroneously, an alleged balance of the purchase price.
court, however, dismissed the suit, ruling that the Lumbres’ registered their title over the
subject property in bad faith. Such ruling was reversed by the RTC which found that there was Indeed, knowledge gained by the first buyer of the second sale cannot defeat the first buyer’s
no valid deed of absolute sale between the sps. Tablada and Spring Homes. Nevertheless, the rights except only as provided by law, as in cases where the second buyer first registers in
CA agreed with the MTCC and reinstated the decision thereof. good faith the second sale ahead of the first.57 Such knowledge of the first buyer does bar her
from availing of her rights under the law, among them, first her purchase as against the second
ISSUE: buyer. But conversely, knowledge gained by the second buyer of the first sale defeats his
Whether the sps Tablada have acquired ownership over the subject property. rights even if he is first to register the second sale, since such knowledge taints his prior
registration with bad faith.
RULING:
Art. 1544. If the same thing should have been sold to different vendees, the ownership shall be Accordingly, in order for the Spouses Lumbres to obtain priority over the Spouses Tablada,
transferred to the person who may have first taken possession thereof in good faith, if it should the law requires a continuing good faith and innocence or lack of knowledge of the first sale
be movable property. that would enable their contract to ripen into full ownership through prior registration. 59 But
from the very beginning, the Spouses Lumbres had already known of the fact that the subject
Should it be immovable property, the ownership shall belong to the person acquiring it who in property had previously been sold to the Spouses Tablada, by virtue of a valid Deed of
good faith first recorded it in the Registry of Property. Absolute Sale. In fact, the Spouses Tablada were already in possession of said property and
had even constructed a house thereon. Clearly then, the Spouses Lumbres were in bad faith the
Should there be no inscription, the ownership shall pertain to the person who in good faith was moment they entered into the second Deed of Absolute Sale and thereafter registered the
first in the possession, and, in the absence thereof, to the person who presents the oldest title, subject property in their names. For this reason, the Court cannot, therefore, consider them as
provided there is good faith. (Emphasis supplied). The principle of primus tempore, potior jure the true and valid owners of the disputed property and permit them to retain title thereto.
(first in time, stronger in right) gains greater significance in case of a double sale of
immovable property. 6. EDU VS.GOMEZ, 129 SCRA 601;

Thus, the Court has consistently ruled that ownership of an immovable property which is the FACTS:
subject of a double sale shall be transferred: The 1968 model Volkswagen, bantam car, allegedly owned by Lt. Walter A. Bala under
whose name it was originally registered, was reported to the Office of the Commission on
(1) to the person acquiring it who in good faith first recorded it in the Registry of Property; Land Transportation as stolen on June 29, 1970 from the residence of Lt. Bala. Upon receipt
(2) in default thereof, to the person who in good faith was first in possession; and of such information the agents of Anti-Carnapping Unit (ANCAR) of the Philippine
(3) in default thereof, to the person who presents the oldest title, provided there is good faith. Constabulary, on detail with the Land Transportation Commission recognized subject car on 2
February 1971 in the possession of LUCILA ABELLO and immediately seized and
The requirement of the law then is two-fold: acquisition in good faith and registration in good impounded the car as stolen property.
faith. Good faith must concur with the registration – that is, the registrant must have no
knowledge of the defect or lack of title of his vendor or must not have been aware of facts Romeo F. Edu, then Commissioner of Land Transportation, seized the car pursuant to Section
which should have put him upon such inquiry and investigation as might be necessary to 60 of Republic Act 4136 which empowers him to seize the motor vehicle for delinquent
acquaint him with the defects in the title of his vendor. If it is shown that a buyer was in bad registration aside from his implicit power deducible from Sec. 4(5), Sec. 5 and 31 of said
faith, the alleged registration they have made amounted to no registration at all. Here, the first Code, "to seize motor vehicles fraudulently or otherwise not properly registered.”
buyers of the subject property, the Spouses Tablada, were able to take said property into
possession but failed to register the same because of Spring Homes’ unjustified failure to Lucia Abello filed a complaint for replevin with damages in the Court of First Instance of
deliver the owner’s copy of the title whereas the second buyers, the Spouses Lumbres, were Manila. CFI ruled in facor of ABELLO. CFI found that the car was acquired by ABELLO by
able to register the property in their names. But while said the Spouses Lumbres successfully purchase from its registered owner Marcelino Guansing for P9,000 and that she has been in
caused the transfer of the title in their names, the same was done in bad faith. possession thereof since then until when the car was seized from her by ANCAR who acted in
belief that the car was stolen from Lt. Bala.
As correctly observed by the Court in Spouses Lumbres v. Spouses Tablada, the Spouses
Lumbres cannot claim good faith since at the time of the execution of their Compromise ISSUE:
Agreement with Spring Homes, they were indisputably and reasonably informed that the Whether or not the seizure of the car by the officials are valid.
subject lot was previously sold to the Spouses Tablada. They were also already aware that the
Spouses Tablada had constmcted a house thereon and were in physical possession thereof. RULING:
They cannot, therefore, be permitted to freely claim good faith on their part for the simple NO.
reason that the First Deed of Absolute Sale between Spring Homes and the Spouses Tablada There is no merit in the petition considering that the acquirer or the purchaser in good faith of
was not annotated at the back of the subject property’s title. It is beyond the Court’s a chattel of movable property is entitled to be respected and protected in his possession as if he
were the true owner thereof until a competent court rules otherwise. In the meantime, as the falsification and insidious scheme and machination because at the time it was notarized, one of
true owner, the possessor in good faith cannot be compelled to surrender possession nor to be the co-owners, Serbio, was already dead. Accordingly, the deed could not be a source of
required to institute an action for the recovery of the chattel, whether or not an indemnity bond BELTRAN’s right over the contested land.
is issued in his favor. The filing of an information charging that the chattel was illegally RTC ruled that BELTRN had a better title over the subject property, affirmed by the CA> MR
obtained through estafa from its true owner by the transferor of the bona fide possessor does by petitioners denied for lack of merit
not warrant disturbing the possession of the chattel against the will of the possessor.
ISSUE:
Finally, the claim of petitioners that the Commission has the right to seize and impound the (1) whether the rules on double sale under Article 1544 of the New Civil Code are applicable;
car under Section 60 of Republic Act 4136 which reads: (2) whether the defective notarization affects the legality of sale; and
(3) whether petitioners can collaterally attacked the respondents' Torrens title.
Sec. 60. The lien upon motor vehicles. Any balance of fees for registration, re-registration or
delinquent registration of a motor vehicle, remaining unpaid and all fines imposed upon any RULING:
vehicle owner, shall constitute a first lien upon the motor vehicle concerned. 1)Double sale is not applicable here for there are two sets of vendors who sold the subject land
to two different vendees.
is untenable. it is clear from the provision of said Section 60 of Republic Act 4136 that the Double sale exists when the same thing is sold to different vendees by a single vendor. Article
Commissioner's right to seize and impound subject property is only good for the proper 1544 has no application in cases where the sales involved were initiated not just by one vendor
enforcement of lien upon motor vehicles. The Land Transportation Commission may issue a but by several vendors.
warrant of constructive or actual distraint against motor vehicle for collection of unpaid fees Here, MALAN and BELTRAN acquired the subject property from different transferors.
for registration, re-registration or delinquent registration of vehicles. >The DOAS (November 20, 1990) shows that all of the original co-owners (except for Manuel
and Serbio, who are already deceased) sold the subject lot to BELTRAN.
>While, the Receipt and Promissory Note both dated May 5, 1983, reveal that only Manuel
7. SPOUSES MANLAN VS. SPOUSES BELTRAN, G.R. NO. 222530, OCTOBER sold the lot to MALAN, but was not duly authorized by the other co-owners to sell the subject
16, 2019 property in 1983.
MANLAN erred using Article 1544 of the New Civil Code:
CASE: If the same thing should have been sold to different vendees, the ownership shall be
Involves the conflicting claims of 2 sets of buyers over a parcel of land. 1 group avers of transferred to the person who may
having bought the property from one of its co- owners and building their house in good faith. have first taken possession thereof in good faith, if it should be movable property.
Meanwhile, the other group claims of having bought the same land from all the co-owners and Should it be immovable property, the ownership shall belong to the person acquiring it who in
registered it in good faith. good faith first recorded it
in the Registry of Property.
FACTS: Should there be no inscription, the ownership shall pertain to the person who in good faith was
Subject 1,214 (sq.m.) land situated in Brgy. Calindagan, Dumaguete City forming part of Lot first in the possession;
1366-E and originally owned in common by (the ORBETA) Serbio, Anfiano, et.al. all and, in the absence thereof, to the person who presents the oldest title, provided there is good
surnamed Orbeta. faith. Cheng v. Genato, enumerated the requisites in order for Article 1544 to apply, viz.:
May 5, 1983 - MANLAN bought a 500 sq.m. portion of the subject property from Manuel (a) The two (or more) sales transactions in issue must pertain to exactly the same subject
Orbeta for P30,000.00. After receiving the advance payment of P15,000.00, Manuel Orbeta matter, and must be valid sales transactions.
allowed MANLAN to occupy it. (b) The two (or more) buyers at odds over the rightful ownership of the subject matter must
October 21, 1986 - Orbetas (except for Manuel Orbeta (deceased); represented by his wife each represent conflicting interests; and (c) The two (or more) buyers at odds over the rightful
Emiliana Orbeta) executed a Deed of Absolute Sale (DOAS) conveying the 714 sq.m. portion ownership of the subject matter must each have bought from the very same
of the same property to Sps. BELTRAN. seller.
November 20, 1990, BELTRAN bought the remaining 500 sq.m. from the Orbetas, by DOAS.
January 28, 1991, the subject property was registered in BELTRAN’s name under (TCT) No. 2) the DOAS are valid and binding
20152. Article 1358 of the Civil Code is only for convenience, that the necessity of a public document
BELTRAN demanded from MANLAN to vacate the property in dispute, but to no avail. for contracts which transmit or extinguish real rights over immovable property.
Thus, they brought the matter to the barangay lupon. When conciliation failed, BELTRAN >It is not essential for its validity or enforceability or the failure to follow the proper form
filed an action for quieting of title and recovery of possession of the 500 sq.m. portion of the prescribed does not render the acts or contracts invalid.
subject land. >Where a contract is not in the form prescribed by law, the parties can merely compel each
BELTRAN claimed to be the absolute owners of the subject property having bought it from other to observe that form, once the contract
the Orbetas. has been perfected.
MANLAN alleged that they bought the 500 sq.m. portion of the disputed land from Serbio and Sale of a real property that is not consigned in a public instrument is valid and binding among
Manuel Orbeta in 1983. Also they contended that the DOAS dated November 20, 1990, the parties.
executed by BELTRAN and the Orbetas, was fictitious, having been procured by means of
 8. TEN FORTY REALTY & DEV’T CORP. VS. CRUZ, G.R. NO. 515212 SEPT. 10,
2003 Private corporations are disqualified from acquiring lands of the public domain, as provided
under Section 3 of Article XII of the Constitution. While corporations cannot acquire land of
FACTS: the public domain, they can however acquire private land. However, petitioner has not
Petitioner filed an ejectment complaint against Marina Cruz(respondent) before the MTC. presented proof that, at the time it purchased the property from Galino, the property had
Petitioner alleges that the land indispute was purchased from Barbara Galino on December ceased to be of the public domain and was already private land. The established rule is that
1996, andthat said land was again sold to respondent on April 1998; alienable and disposable land of the public domain held and occupied by a possessor —
personally or through predecessors-in-interest, openly, continuously, and exclusively for 30
On the other hand, respondent answer with counterclaim that never was there an occasion years — is ipso jure converted to private property by the mere lapse of time.
when petitioner occupied a portion of the premises. In addition, respondent alleges that said
land was a public land (respondent filed a miscellaneous sales application with the RULING:
Community Environment and Natural Resources Office) and the action for ejectment cannot
succeed where it appears that respondent had been in possession of the property prior to the The Supreme Court DENIED the petition.
petitioner;
9. SPOUSES TOMAS AND SILVINA OCCENA VS. ESPONILLA, GR NO 156973,
On October 2000, MTC ordered respondent to vacate the land and surrender to petitioner 6-4-2004
possession thereof. On appeal, the RTC reversed the decision. CA sustained the trial court’s
decision. FACTS:
Spouses Nicolas and Irene Tordesillas owned a piece of land which their children Harod,
ISSUE/S: Angela and Rosario, and grandchildren Arnold and Lilia de la Flor inherited. The heirs sold a
Whether or not petitioner should be declared the rightful owner of the property. part of the land to Alberta Morales. Morales possessed the lot as owner, constructed a house
on it and appointed a caretaker to oversee her property. Arnold borrowed the Original
HELD: Certificate of Title (OCT) from Alberta covering the lot. Then, he executed an Affidavit
No. Respondent is the true owner of the land.1) The action filed by the petitioner, which was acknowledging receipt of the OCT in trust and undertook to return said title free from changes,
an action for “unlawful detainer”, is improper. As the bare allegation of petitioner’s tolerance modifications, or cancellations. However, Arnold used the OCT he borrowed from the vendee
of respondent’s occupation of the premises has not been proven, the possession should be Alberta Morales, subdivided the entire lot into three sublots, and registered them all under his
deemed illegal from the beginning. Thus, the CA correctly ruled that the ejectment case should name. Arnold did not return the OCT belonging to Alberta despite repeated requests. Arnold
have been for forcible entry. However, the action had already prescribed because the subsequently sold the land to spouses Tomas and Sylvina Occeña. When the respondent heirs
complaint was filed on May 12, 1999 – a month after the last day forfiling;2) The subject of Alberta learned of the sale, they filed a case for annulment of sale and cancellation of titles,
property had not been delivered to petitioner; hence, it did not acquire possession either with damages, against the Occeña spouses, alleging bad faith since the
materially or symbolically. As between the two buyers, therefore, respondent was first in Occeñas conducted ocular inspection of the area before the purchase and their caretaker
actual possession of the property. warned them that Arnold is no longer the owner of the lot being sold. On the other hand, the
Occeña spouses alleged that they were buyers in good faith as the titles to the subject lots were
As regards the question of whether there was good faith in the second buyer. Petitioner has free from liens or encumbrances when they purchased them, that they verified with the
not proven that respondent was aware that her mode of acquiring the property was defective at Antique Registry of Deeds that Arnold’s TCTs were clean and unencumbered. Lower court
the time she acquired it from Galino. At the time, the property — which was public land –had declared the Occeña spouses as buyers in good faith and ruled that the action of the heirs was
not been registered in the name of Galino; thus, respondent relied on the tax declarations time-barred. Court of Appeals reversed the decision of the trial court. Hence the petition.
thereon. As shown, the former’s name appeared on the tax declarations for the property until
its sale to the latter in 1998. Galino was in fact occupying the realty when respondent took ISSUE:
over possession. Thus, there was no circumstance that could have placed the latter upon Whether a purchaser of a registered land is obliged to make inquiries of any possible defect or
inquiry or required her to further investigate petitioner’s right of ownership. adverse claim which does not appear on the Certificate of Title

DOCTRINE/S: RULING:
Petition dismissed. The petition at bar presents a case of double sale of an immovable
Execution of Deed of Sale; Not sufficient as delivery. Ownership is transferred not by contract property. Article 1544 of the New Civil Code provides that in case an immovable property is
but by tradition or delivery. Nowhere in the Civil Code is it provided that the execution of a sold to different vendees, the ownership shall belong: (1) to the person acquiring it who in
Deed of Sale is a conclusive presumption of delivery of possession of a piece of real estate. good faith first recorded it in the Registry of Property; (2) should there be no inscription, the
The execution of a public instrument gives rise only to a prima facie presumption of delivery. ownership shall pertain to the person who in good faith was first in possession; and, (3) in the
Such presumption is destroyed when the delivery is not effected, because of a legal absence thereof, to the person who presents the oldest title, provided there is good faith. In all
impediment. Such constructive or symbolic delivery, being merely presumptive, was deemed cases, good faith is essential. It is the basic premise of the preferential rights granted to the one
negated by the failure of the vendee to take actual possession of the land sold. Disqualification claiming ownership over an immovable. What is material is whether the second buyer first
from Ownership of Alienable Public Land. registers the second sale in good faith, i.e., without knowledge of any defect in the title of the
property sold. The defence of indefeasibility of a Torrens title does not extend to a transferee
who takes the certificate of title in bad faith, with notice of a flaw. Indeed, the general rule is
that one who deals with property registered under the Torrens system need not go beyond the
same, but only must rely on the title. He is charged with notice only of such burdens and
claims as are annotated on the title. However, this principle does not apply when the party has
actual knowledge of facts and circumstances that would impel a reasonably cautious man to
make such inquiry or when the purchaser has knowledge of a defect or the lack of title in his
vendor or of sufficient facts to induce a reasonably prudent man to inquire into the status of
the title of the property in litigation. One who falls within the exception can neither be
denominated an innocent purchaser for value nor a purchaser in good faith.