GARCIA VS CA

11 Feb

L – 48971 |January 22, 1980 | J. Aquino

Facts:

This case is about the issuance of two or more transfer certificates of title to different persons for the same lot, or subdivisions thereof, due to the fact that the original title was allegedly not cancelled when the first transfer certificates of title were issued to replace the original title.

A deed of sale for lots E and G of Hacienda Maysilo and covered by OCT No. 983 was executed in favor of Ismael Lapus, a bona fide occupant thereof. The deed of sale was presented for registration and contained entries showing that it was annotated on the back of the OCT. Contrary to SOP however, the deed of sale was not annotated on the OCT and that consequently, that title was apparently not cancelled.

As a result of the registration of the deed of sale, TCT No. 4910 (“Lapus Title”) was issued to Lapus. Upon his death, the two lots were inherited by his daughter Carolina Lapuz-Gozon, who had the land subdivided into 55 lots and sold some to her now co-respondents. Lapus and successors-in-interest have been in possession of the lands even before 1910 of more than 70 years.

In 1962, the Riveras, alleged heirs of the late Maria de la Concepcion Vidal filed a motion in land registration cases, alleging that they were deprived of their participation in the Hacienda Maysilo. Since per the OCT the land seemed unencumbered, the court adjudicated the land in their favor. The OCT was then cancelled and TCT No. 112235 (“Rivera Title”) was issued to the Riveras. Lots 5 and 7 (E and G) were then assigned to Bartolome Rivera to Sergio Cruz and Pacifico Garcia, and subsequent TCTs were issued in their behalf.

Garcia had Lot 7 (G) subdivided into lots A and B, retained lot A and assigned B to Antonio Munoz. Munoz mortgaged lot B to Associated Banking Corp.

On the other hand, Cruz sold Lot 5 (E) to Santiago Go. Go mortgaged Lot 5 to Philippine National Bank. Both Munoz and Go did not pay their mortgage debts, hence the two banks foreclosed the properties. PNB bought the mortgaged Lot 5 at the auction, but notice of lis pendens was already annotated on the title.

Riveras and their successors-in-interest have never set foot on the disputed lots.

Gozon finally learned about the Riveras and others acquiring the land, had her adverse claims registered on the titles of lots 5 and 7 and filed an action to quiet title and damages.

The trial court ruled in favor of Gozon and co-plaintiffs and voided the TCTs issued to the Riveras, others.  CA affirmed the decision. Garcia and PNB appealed.

 

Issue:

W/N the 1920 Lapus title prevails over the 1963 Rivera title and subsequent titles derived from it?

 

Held:

Yes, Lapus title prevails. Lapus was an innocent purchaser for value who validly transmitted to his successors-in-interest his indefeasible title or ownership over the disputed lots. That title could not be nullified or defeated by the issuance 43 years later to other persons of another title over the same lots due to the failure of the register of deeds to cancel the title preceding the title issued to Lapus. This must be so considering that Lapus and his successors-in-interest remained in possession of the disputed lots and the rival claimants never possessed the same.

The general rule is that in the case of two certificates of title, purporting to include the same land, the earlier in date prevails. It is settled that in this jurisdiction the maxim prior est in tempore, potior est in jure (he who is first in time is preferred in right) is followed in land resgistration matters.

The contention of PNB that it was a buyer in good faith has no merit because the deed of sale in favor of Lapus and the titles issued to him and his successors-in-interest are all a matter of public record in the registry of deeds. When a conveyance has been properly recorded, such record is a constructive notice of its contents and all interests, legal and equitable, included therein. Under the rule of notice, it is presumed that the purchaser has examined every instrument of record affecting the title. This presumption cannot be overcome by proof of innocence and good faith otherwise the very purpose of the law requiring a record would be destroyed. The bank should have made an on-the-spot investigation of the lot mortgaged.

Decision affirmed.

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