G.R. No. L-4929




Republic of the Philippines SUPREME COURT Manila EN BANC G.R. No. L-4929 July 23, 1953 ANTONIO MIRASOL, petitioner, vs. PORFIRIO GEROCHI Y GAMBOA, MARIANO GEROCHI Y GAMBOA, JUAN NAVAJAS Y GAMBOA, SATURNINA NAVAJAS Y GAMBOA and the COURT OF APPEALS, respondents. Jose D. Evangelista for petitioner. Luis G. Hofileña and Cesar T. Martin for respondents. BAUTISTA ANGELO, J.: This is a petition for review of a decision of the Court of Appeals rendered on June 14, 1951 wherein, among other things, the deed of sale executed by Saturnina Navajas in favor of Antonio Mirasol, petitioner herein, was declared valid in so far as the share and participation of said Saturnina in lot No. 3760 of the cadastral survey of Iloilo City is concerned, which participation is one-half (½) of the undivided one-fourth (¼) belonging to her mother Dionisia Gamboa; Juan Navajas was declared owner of one-half (½) of the same undivided share; and with regard to the cross-claim of Antonio Mirasol, Natividad Escarilla was ordered to pay him the sum of P1,575. In the same decision it was ordered that the judgment be registered and annotated on the original Certificate of Title No. 1399 covering lot No. 3760. On July 30, 1946, two deeds of sale were executed, one by Filomena Ledesma, who posed as only heir of the deceased Teodorica Gamboa, over one-fourth undivided share belonging to the latter in Lot No. 3760 of the cadastral survey of the City of Iloilo, which lot was covered by original Certificate of Title No. 1399, in favor of Salvador Solano, and another executed by Saturnina Gerochi, who posed as only heir of the deceased Dionisia Gamboa, over one-fourth undivided share belonging to the latter in the same lot No. 3760, in favor of the same purchaser. These two deeds were annotated on the original Certificate of Title No. 1399, as well as on the owners' duplicate of the same title. On August 1, 1946, Salvador Solano in turn sold with pacto de retro for a term of two years the portion bought from Saturnina Gerochi to Natividad Escarilla for the sum of P3,500, and on August 17, 1946, he sold to the same person and under the same terms the portion he bought from Filomena Ledesma for the sum of P1,400, which was later increased to P3,150. These deeds were also annotated on the original as well as on the duplicate certificate of title of the property on September 14, 1946. When Natividad Escarilla became the absolute owner of the two portions mentioned in the preceding paragraphs, she transferred her interest, right and participation over one-half of the undivided one-fourth share which was originally acquired from Saturnina Gerochi to Antonio Mirasol for the sum of P3,150 on October 21, 1946, and the corresponding deed of sale was likewise annotated on the original and duplicate of the certificate of title of the property. On October 8, 1947, Porfirio Gerochi, Mariano Gerochi, Juan Navajas and Saturnina Navajas began an action in the Court of First Instance of Iloilo against Natividad Escarilla, Antonio Mirasol, Salvador Solano and Saturnina Gerochi for the annulment of the deeds above-mentioned alleging, on one hand, that Porfirio and Mariano Gerochi were the only heirs of Teodorica Gamboa and, therefore, the owners of the one-fourth undivided share which had been sold by Filomena Ledesma to Salvador Solano, and on the other, that Saturnina and Juan Navajas were the heirs of Dionisia Gamboa and, therefore, the owners of the one-fourth undivided share which had been sold by Saturnina Gerochi to Salvador Solano, and praying that said deeds be declared null and void and that the plaintiffs be declared respectively owners of the shares and interests therein mentioned. The court, after receiving the evidence of both parties dismissed the complaint, with costs against the plaintiff. The court said that while "plaintiffs Mariano Gerochi andSaturnina Navajas themselves executed exhibits 5-Escarrilla and 8-Escarrilla and therefore are estoppel from seeking their annulment on the grounds alleged in the complaint, the same cannot be said with respect to the plaintiffs Porfirio Gerochi and Juan Navajas. Their remedy, however, would seem to lie not in this action but under the provisions of Rule 74, et seq., of the Rules of Court.". Upon appeal taken by the plaintiffs, the Court of Appeals modified the decision appealed from in the following dispositive part:. FOR THE FOREGOING CONSIDERATION, the judgment appealed from is hereby modified, and we hereby declare (1) that by virtue of the deeds of sale and conveyance designated as Exhibits 4-Escarrilla and 5-Escarrilla, which we hereby declare valid and executed by Saturnina Navajas, and Annex F, defendant Antonio Mirasol is now the owner of the share and participation of Saturnina Navajas in lot No. 3760 of the cadastral survey of Iloilo, which participation is one-half (½) of the undivided one-fourth (¼) belonging to her mother Dionisia Gamboa; (2) that the deeds, Exhibits 8-Escarrilla, 7-Escarrilla, and 6-Escarrilla, and null and void, and the annotations thereof on the certificate of title, Exhibit A, ordered cancelled;(3) the Porfirio and Mariano Gerochi continue to be and are the owners of the undivided one-fourth (1/4) share and participation and (4) that plaintiff Juan Navajas is the owner of one-half (½)of the one-fourth (¼) undivided share and participation of the order that this judgment be registered and annotated on Original Certificate of Title No. 1399. The action of the plaintiff-appellant Saturnina Navajas is hereby dismissed. Judgment is also hereby rendered in favor of defendant Antonio Mirasol on his cross-claim against his co-defendant Natividad Escarilla, who is ordered to pay him the sum of P1,575.00. Judgment is also rendered on Natividad Escarrilla's cross-claim in her favor and against Filomeno Ledesma and Salvador Solano, jointly and severally, ordering the latter to indemnify her in the amount of P1,750. One-half of the costs shall be taxed against plaintiff-appellants Saturnina Navajas; the other half against defendants-appellants Salvador Solano and Filomeno Ledesma.". The case is now before this Court by virtue of the petition for review interposed by Antonio Mirasol who now contends that the Court of Appeals, in deciding the issues involved and raised by the parties has ignored the pertinent provisions of Act No. 496 and the several decisions of this Court which proclaim the indefeasibility of a torrens title and protect every subsequent purchaser of registered land who takes a certificate of title for value and in good faith against all encumbrances except those noted on the certificate of title. Petitioner claims that, having been found to be purchaser in good faith and for value of a registered land, the deeds of sale subject of the petition for review cannot be declared null and void to his prejudice. One of the cases cited by petitioner is support of his contention if De la Cruz vs. Fabie, 35 Phil. 144, wherein it was held that, "even admitting the fact that a registration obtained by means of fraud or forgery is not valid, and may be cancelled forthwith, yet when a third person has acquired the property subject matter of such registration from the person who appears as registered owner of the same, his acquisition is valid in all respects and the registration in his favor cannot be annulled or cancelled; neither can the property be recovered by the previous owner who is deprived thereof by virtue of such fraud or forgery. (See Reynes vs. Barrera, 68 Phil. 656.). The doctrine laid down in the case of De la Cruz vs. Fabie was reaffirmed in the subsequent case of Reynes, et al. vs. Barrera, et al., 68 Phil. 656, wherein this Court made the following pronouncement: There is no question that the defendant-appellant is a purchaser of lot No. 471-b in good faith and for a valuable consideration. There was nothing in the certificate of title of Manuel Reynes, from whom she acquired the property, to indicate any cloud or vice in his ownership of the property, or any encumbrance thereon. Where the subject of a judicial sale is a registered property, the purchaser thereof is not required to explore farther than what the Torrens title, upon its face, indicates in quest for any hidden defect or inchoate right that may subsequently defeat his right thereto. If the rule were otherwise, the efficacy and conclusiveness of the certificate of title which the Torrens system seeks to insure, would entirely be futile and nugatory. "Every applicant receiving a certificate of title in pursuance of a decree of registration, and every subsequent purchaser of registered land who takes a certificate of title for value in good faith, shall hold the same free of all en-cumbrance except those noted on said certificate . . . . ." (Sec. 39, Act No. 496, as amended by Act No. 2011.) In De la Cruz vs. Fabie (35 Phil., 144), it was held that, even admitting the fact that a registration obtained by means of fraud or forgery is not valid, and may be cancelled forthwith, yet, when a third person has acquired the property subject matter of such registration from the person who appears as registered owner of same, his acquisition is valid in all respects and the registration in his favor cannot be annulled or cancelled; neither can the property be recovered by the previous owner who is deprived thereof by virtue of such fraud or forgery. Petitioner herein cannot invoke in his favor the benefit of the salutary doctrine laid down in the cases above adverted to. His situation is different from that of Ramon Fabie in the case of De la Cruz. In that case, it has been shown "that Ramon Fabie is an innocent holder of a certificate of title for value." Vedasto Velasquez, from whom he bought the property, not had a title in his name on the strength of said deed of sale, and so it was there declared that "in conformity of the oft-cited section 55 of Act No. 496, he is the absolute owner of the land mentioned in the complaint, and the action for recovery of possession, improperly brought against him, can in no wise prosper.". Antonio Mirasol is in a different predicament. He brought the property from Natividad Escarrilla, who in turn acquired it from Salvador Solano. The different deeds of conveyance were merely annotated on the orginal and du-plicate certificates of title which appear in the name of the previous owner. Neither Solano, nor Escarrilla, nor Mirasol ever secured from the Register of Deeds the transfer of a new certificate of title in their names. In other words, the only picture Mirasol presents before us is that of a purchaser of registered land from a person who did not have any certificate of title in his name, his only evidence being the deed of sale in his favor, and its annotation on the certificate of title in his name, his only evidence being the deed of sale in his favor, and its annotation on the certificate of title which still appears in the name of the previous owners, most of whom had already died. He is not therefore a "subsequent purchaser of registered land who takes a certificate of title for value and in good faith" and who is protected against any encumbrance except those noted on said certificate, as provided for in section 39 of Act No. 496. The case of petitioner falls squarely within the doctrine laid down in the case of The Director of Lands vs. Addison, 49 Phil., 19, wherein this Court ruled that the entry of a memorandum of a conveyance in fee simple upon the original certificate of title without the issuance of a transfer certificate of title to the purchaser is not a sufficient registration of such a conveyance. The issuance of a transfer certificate of title to the purchaser is one of the essential features of a conveyance in fee by registration and in order to enjoy the full protection of the registration system, the purchaser must be a holder in good faith of such certificate. And elaborating on this point, and incidentally in drawing a striking contrast between the case above referred to and that of De la Cruz, this Court said:. As will be seen, the issuance of a transfer certificate of title to the purchaser is one of the essential features of a conveyance in fee by registration and in order to enjoy the full protection of the registration system, the purchaser must be a holder in good faith of such certificate. This appears clearly from section 39 of the Land Registration Act which provides that "every applicant receiving a certificate of title in pursuance of a decree of registration, and every subsequent purchaser of registered land who takes a certificate of title for value in good faith, shall hold the same free of all encumbrance except those noted on said certificate, and any of the following incumbrances which my be subsisting, namely:(enumeration of subsisting incumbrances)." In fact the register of deeds has no authority to register a conveyance in fee without the presentation of the conveyor's duplicate certificate unless he is ordered to do so by a court of competent jurisdiction (see Land Registration Act, section 55). As we have already shown, neither Pedro Manuntag nor Soledad P. Hernandez ever held a certificate of title to the land here in question and there had therefore been no sufficient legal conveyance in fee to them neither by deed nor by registration. The original certificate of title No. 414 in favor of the Angeles heirs has never been cancelled and is the only certificate in existence in regard to the property. "In the case of De la Cruz. vs. Fabie, supra, the situation was entirely different. There the registration of the property in question was decree in the name of Gregoria Hernandez and a duplicate original certificate of title issued to her. She turned the duplicate certificate over to her nephew, the defendant Vedasto Velasquez, who forged a deed to himself of the property and presenting the same with the duplicate certificate of title to the register of deeds obtained a transfer certificate with its corresponding duplicate in his own name. He thereafter sold the land to his co-defendant Ramon Fabie to whom a transfer certificate of title was issued upon the cancellation of Velasquez' certificate. There was there-fore a complete chain of registered title. The purchaser was guilty of no negligence and was justified in relying on the certificate of title held by the vendor. In the present case, on the other hand, the vendor held no certificate of title and there had therefore been no complete conveyance of the fee to him. The purchaser was charged with presumptive knowledge of the law relating to the conveyance of land by registration and, in purchasing from a person who did not exhibit the proper muniments of title, must be considered to have been guilty of negligence and is not in position to complain of his loss.". Wherefore, the decision appealed from is affirmed, with costs against petitioner. Paras, C.J., Pablo, Bengzon, Padilla, Tuazon, Montemayor, Reyes, and Jugo, JJ., concur. The Lawphil Project - Arellano Law Foundation