Valdez(s) (P) v. CA, Judge Buzon, Sps Salvador (PRs) | GR No. 106042 | 2.28.94 | Double Sales | Nocon, J p: PR (Possessors) Sps bought a land in Malabon from Dionisio Santiago (DS) they didnt register the subject; P Valdez(s) bought the subject property from Ma. Dela Cruz vda. De Santiago (Original Wife) and Jose Santiogo (Son), heirs of Dionisio Santiago, a TCT was named after them. Ps lawyer then demanded from PR to vacate, the other half of the subject, to no avail hence the suing; PR claims that they bought the same property from Dionisio Santiago; claiming that they bought the same by halves until the last half were payment was made to DSs common law wife Benjamina Magalong. The lower court dismissed the complaint for lack of merit; holding that there was a double sale of the subject; holding petitioners as purchasers in bad faith, for failing to make inquiry concerning the rights of PR; The CA affirmed hence this. Before us is a case registered land which had been sold to two different persons. Dismissed. It is true that petitioners examined the certificate of title; And it is equally true that a person dealing with the owner of registered land is not bound to go beyond the certificate of title. However, it is important to note that petitioners did not buy the land from the registered owner, Dionisio Santiago. They bought it from his heirs, Maria dela Cruz and Jose Santiag, the law requires a higher degree of prudence even if the land object of the transaction is registered. One who buys from one who is not the registered owner is expected to examine not only the certificate of title but all factual circumstances necessary for him to determine if there are any flaws in the title of the transferor, or in his capacity to transfer the land. Buying land from one not the registered owner should have put the buyer on guard concerning facts which would acquaint him with defects in the title or capacity to transfer of the vendor. As records bear it out, appellant had knowledge of circumstances which ought to have put them on an inquiry but they did not. Such failure to exercise ordinary care expected of real estate buyers necessarily means bearing the consequences of their own acts. We also do not find private respondents equally blameworthy for failing to register during the period of time cited above by petitioners. Their uninterrupted possession of the property may have fostered complacency but their omission to register within this period cannot constitute a situation of in pari delicto.Sps Occea (P) v. Obsania Salazar(s) (PR) | GR No. 156973 | 6.4.04 | Double Sales | Puno, J p: The subject is a land in Sibalom, Antique owned by Sps Tordesillas w/ OCT; they had 3 children, namely: Harod, Angela, and Rosario who has 2 children Arnold and Lilia After the Sps Tordesillas death, the subject was inherited by Harod and Angela and the granddaughters (GDs); The GDs sold their rights to Alberta Morales, attested by the 2 inheritors. Alberta possessed the subject and there built a house; Later, Arnold borrowed the OCT from Alberta, w/c was received and acknowledged In 1966 Arnold and Angela, nephew and daughter of the Tordesillas Sps, w/o knowledge of Alberta, executed a Deed of Extrajudicial settlement declaring the themselves as the only co-owners of the undivided land, w/o acknowledging their sle to Alberta. Arnold now wouldnt return the OCT; Arnold also became sole owner when Angela died; Alberta died and her nieces-heirs Lydia, Elsa and Dafrosa asked Arnold of the OCT because they were leaving for the US, to no avail; and they left. Arnold then subdivided the entire lot into 3 and acquired title thereto; thereafter sold to P sps the subject were the 748 of the heirs of Alberta was; Arnold died. Upon knowledge, PRs sued for the cancellation of the titles, alleging the Sps P bought the subject in bad faith (care taker advised them) knowing that it was previously sold Sps P holds denial of knowledge; that they verified in the ROD; laches and prescriptions. LC ruled in favour of Sps p holding the PRs are time-barred. The CA reversed, it found that P Sps are in bad faith and it was not barred by prescription. Dismissed. The petition at bar presents a case of double sale of an immovable property. Article 1544 of the New Civil Code provides that in case an immovable property is sold to different vendees, the ownership shall belong: (1) to the person acquiring it who in good faith first recorded it in the Registry of Property; (2) should there be no inscription, the ownership shall pertain to the person who in good faith was first in possession; and, (3) in the absence thereof, to the person who presents the oldest title, provided there is good faith. Tomas Occea admitted that he found houses built on the land during its ocular inspection prior to his purchase. He relied on the representation of vendor Arnold that these houses were owned by squatters and that he was merely tolerating their presence on the land. Tomas should have verified from the occupants. The evidence that the caretaker of the house which Alberta Morales built on the land, personally informed Tomas that the lot had been previously sold. In sum, registration under the Torrens system is the operative act which gives validity. However, it does not create or vest title especially where a party is bad faith.

Sps Olivares (P) v. Judge Gonzales, Tuvilla(s) & Tumabini| GR No. L-34500 | 3.18.88 | Double Sales | Melencio-Herrera, J p: The subject is unregistered in Iloilo, previously owned by PRs Tu; In 1995 sold the same w/ right to repurchase in favour of PR Tb; In 1959 PRs TU executed a DOS w/ Pacto de Retro in favour of Ps, it was registered in the ROD, it was followed by a DOAS in 1966 Ps was in possession since 1959. In 1967 PR Tb sued the PR Tu for consolidation of ownership, by alleged failure of PR Tu to redeem the property, Ps were not included as parties to the case. On pre-trial PRs agreed to consider he pacto de retro sale as one of equtable mortgage, thus the court ruled in favour of PR TB, pursuant to w/c the court issued a writ of execution in 1968. On 11.23.68 Ps sued for Quieting of Title, the court issued a RO to stop the consolidation. But subsequently the subject was sold at an auction PR TB won; however the tenant of Ps refused to give in. The Quieting of Title was dismissed, it was never asked for reconsideration by Ps; when they refilled it was dismissed again for being the same. Hence this. Set Aside. Remanded. The equities of the case are with the Olivareses. The first sale with pacto de retro by the Tuvillas to Tumabini was unregistered; in contrast, the sale in favor of the Olivareses was duly recorded. The Consolidation Case (Case No. 7410) instituted by Tumabini against the Tuvillas for consolidation of his ownership did not include the Olivareses as parties defendants even though they were then in possession of the Disputed Property. Justice and equity demand, therefore, that their side be heard in the Refiled Case (No. 8698). In other words, it would be more in keeping with substantial justice if the controversy between the parties to be resolved on the merits rather than on a procedural technicality in the light of the express mandate of the Rules that they be "liberally construed in order to promote their object and to assist the parties in obtaining just, speedy and inexpensive determination of every action and proceeding." The dismissal of actions is based on sound judicial discretion and such discretion "must be exercised wisely and prudently, never capriciously, with a view to substantial justice." For having failed to meet that standard it will have to be held that respondent Judge acted with grave abuse of discretion (see Tandoc vs. Tensuan, L-50835, October 30, 1979, 93 SCRA 880).

C. Astorga, F. Astorga & Dableo (P) v. CA, Montao(s) (PRs) | GR No. 58530 | 12.26.84 | Double Sales | Aquino, J p: The subject Originally owned by Sps Virgenesa (OCT 20585), after their death, a certain Elias Nombre adjudicated the land to himself and sold the same to Sps Dableo and Esperas. Dableo, already a widow, sold to Ps Lot No. 1540, not immediately registered because Dableo lost the OCT w/c was reported to the ROD, asking for the issuance of a new owners duplicate, w/c was granted (TCT T-3917), then the sale to Ps were registered, they moved in 1972. Sps Abulayan and Montao now came, claiming that they bought the same to the sps Dableo in 1956, a compadre of Dableo, the deed was notarized, and registered 11 (TCT T-8848) years later in 1968. LC ruled in Favor of Ps, holding that Ps were in possession, and PRs were never was. The CFI affirmed at first, but on motion they ordered to implead Dableo, and reversed itself; CA Affirmed. Hence this. Reversed. Set-Aside. We hold that under article 1544 of the Civil Code the sale by Lucila Dableo to the Astorga spouses in 1972 should prevail over the alleged 1956 sale to Montao because the Astorga spouses acquired ownership over the disputed lot since they were the first to register in good faith their sale in the registry of property. Lucila Dableo delivered to them the reconstituted owner's duplicate of OCT No. 20585. She did not deliver the owner's duplicate to Montao who did not explain how he was able to obtain his Torrens title. His title must be deemed spurious. His photostatic copy of his title, Exhibit C, is blurred. One cannot determine when it was actually issued.

Caram (P) v. Laureta (PR) | GR No. L-28740 | 2.24.81 | Double Sales | Fernandez, J p: In 1959 PR sued for recovery P. In 1945 M. Mata conveyed agricultural land (OCT 3019) to PR, said conveyance was not registered because the DOS wasnt notarized, since there was no working government yet (After WWII), but still it was a proper transfer since then taxes were paid by PR, including improvements he introduced. M. Mata, 2 years later, sold the same to P, telling the latter that he lost the OCT, so they went to the court for the issuance of a new title, the court granted ordering the ROD to issue a new one. (TCT 140) In his defense M. Mata alleged that he was only forced to execute a DOS by PR, under duress and intimidation. Further alleging that the executed DOS w/ P was because of fraud and misrepresentation, adding that he was an illiterate (Thumb mark Signed) LC ruled that the sale to PR stands and prevails; CA Affirms; hence this. Denied. Affirmed. The facts of record show that Mata, the vendor, and P, the second vendee had never met. During the trial, Marcos Mata testified that he knows Atty. Aportadera but did not know Caram. Thus, the sale of the property could have only been through Caram's representatives, Irespe and Aportadera. The petitioner, in his answer, admitted that Atty. Aportadera acted as his notary public and attorney-in-fact at the same time in the purchase of the property. 'The Court cannot help being convinced that Irespe, attorney-in-fact of Caram, Jr., had knowledge of the prior existing transaction, Exhibit A, between Mata and Laureta over the land, subject matter of this litigation, when the deed, Exhibit F, was executed by Mata in favor of Caram, Jr. And this knowledge has the effect of registration as to Caram, Jr.' (R.A. pp. 123-124). Even if Irespe and Aportadera did not have actual knowledge of the first sale, still, their actions have not satisfied the requirement of good faith. Bad faith is not based solely on the fact that a vendee had knowledge of the defect or lack of title of his vendor. "One who purchases real estate with knowledge of a defect or lack of title in his vendor can not claim that he has acquired title thereto in good faith, as against the true owner of the land or of an interest therein, and the same rule must be applied to one who has knowledge of facts which should have put him upon such inquiry and investigation as might be necessary to acquaint him with the defects in the title of his vendor." The rule of caveat emptor requires the purchaser to be aware of the supposed title of the vendor and one who buys without checking the vendor's title takes all the risks and losses consequent to such failure. Revilla & Fajardo (PA) v. Galindez (DA) | GR No. L-9940 | 3.30.60 | Double Sales | Guttierrez-David, J p: Ps are seeking recovery of the Subject (Lot 659-A); formerly registered to Gasmena (TCT 7454) w/c was donated to F. Gasmena (1.8has), annotated, w/c the latter mortgaged to PR w/c was later sold in 1938 to the same, it was registered and been in possession ever since. In 1941, after F. Gasmenas death, the land conveyed to PR was registered, a TCT was issued w/o annotation (NT-7782). In 1950, the Heirs of F. Gasmena extrajudicially adjudicated the subject and sold the same to P, Ps examined the TCT, finding no encumbrances, they moved for the issuance of their new TCT. When they tried to eject PR, they were informed of the former sale to the same. Then the suing. LC nullified the extrajudicial partition and sale, hence this. Affirmed. The law protects to a greater degree a purchaser who buys from the registered owner himself. Corollarily, it requires a higher degree of prudence from one who buys from a person who is not the registered owner, although the land object of the transaction is registered. While one who buys from the registered owner does not have to look behind the certificate of title, one who buys from one who is not the registered owner is expected to examine not only the certificate of title but all factual circumstances necessary for him to determine if there are any flaws in the title of the transferor, or in his capacity to transfer the land. Where a person buys land not from the registered owner but from one whose right to the land has been merely annotated on the certificate of title, he is not considered a "subsequent purchaser of registered land who takes certificate of title for value and in good faith and who is protected against any encumbrance except those noted on said certificate". If the vendees purchased the land not from the registered owner but from the heirs of a deceased person in whose name the certificate of title was issued nine years after he died, then such vendees are not purchasers in good faith entitled to the protection of the Torrens system of registration, even if they had secured in their names a certificate of title.

Navarro & Fortea (P) v. 2nd Laguna Devt Bank & Sps Guzman & Esporlas (R) | GR No. 129428 | 2.27.03 | Double Sales | Sandoval-Guttierrez, J p: Sps P et al, were co-owners of a parcel of land (TCT No. 244200). In 1978, Sps Velasco and Navarro, conspiring with the latter's sister Luciana Navarro (P), executed a falsified DOAS wherein they made it appear that the entire lot was sold to said spouses Velasco. TCT No. 114526 in the names of Sps Velasco was accordingly issued. Subsequently, they mortgaged the property to R Bank to secure payment of a loan. In 1987, the respondent Bank, foreclosed the mortgage; In 1988 and 1990, Sps P, introducing themselves as attorneys-in-fact of Esther Navarro-Velasco, wrote the R Bank, offering to redeem the property. However, they failed to do so. Hence, ownership thereof was consolidated in the name of respondent Bank and a new TCT was thereafter issued in its favour; In 1990, sued for annulment of the mortgage and the consolidation of ownership with damages. They alleged that the sale of the lot with respect to their 1/6 share was void ab initio considering that their signatures appearing in the Deed of Absolute Sale were falsified. Pendente Lite, it was sold to PR Sps, impleaded by Sps P, alleging purchasers in bad faith. CFI against Sps P, CA Affirmed. Hence this. In dismissing the petition, the Supreme Court held that the petitioners were estopped from assailing the validity of the sale of the property to respondent spouses Guzman. "A person, who by his deed or conduct has induced another to act in a particular manner, is barred from adopting an inconsistent position, attitude or course of conduct that thereby causes loss or injury to another." Petitioners, in their two letters to respondent Bank, did not state that spouses Velasco falsified their signatures appearing in the Deed of Absolute Sale. Nor did they question the validity of the mortgage and its foreclosure. In Rural Bank of Compostela vs. Court of Appeals, this Court held that the rule that persons dealing with registered lands can rely solely on the certificate of title does not apply to banks because their business is one affected with public interest, keeping in trust money belonging to their depositors, which they should guard against loss by not committing any act of negligence which amounts to lack of good faith. In entering into the mortgage contract with spouses Velasco, there was no indication that respondent bank acted in bad faith. Spouses Velasco presented to the bank their TCT No. 114256 showing they were then the absolute owners thereof. Indeed, there were no circumstances or indications that aroused respondent bank's suspicion that the title was defective.

Remalante (P) v. Tibe & CA (R) | GR No. 59514 | 2.25.88 | Double Sales | Cortes, J p: Private respondent's evidence shows that on December 15, 1965, petitioner came to the house of private respondent and requested her to sign papers purported to be bail bonds for his provisional liberty in connection with a concubinage case filed against him by his wife. However, private respondent discovered later that the papers she was made to sign were actually: (1) affidavits of transfer (Exhibits I-3, K and M) of her three parcels of land under Tax Declaration Nos. 20280, 20273 and 20274 which she purportedly donated to petitioner; and (2) a deed of absolute sale (Exhibit 22) in favor of petitioner of her other three parcels of land under Tax Declaration Nos. 13959, 17388 and 16999. On the other hand, petitioner presented evidence to show that he is the owner of the six (6) parcels of land subject of this case. He claimed that he bought the first three (3) parcels (those covered by Tax Declaration Nos. 20280, 20273 and 20274) from Silvino Alminario before they were bought by private respondent. He agreed to have the properties transferred to the name of private respondent to accommodate her request to use the properties as collateral in securing a loan from a bank. However, he found out later that private respondent did not apply for any loan. Petitioner reported the case to the Municipal Mayor of Dagami, Leyte and private respondent was summoned before the mayor and was made to sign affidavits of transfer (Exhibits I-3, K and M) in favor of petitioner.

Consolidated Rural Bank (Cagayan) (P) v. CA & Heirs of Teodora dela Cruz (R) | GR No. 132161 | 1.17.05 | Double Sales | Tinga, J p: The Madrid Siblings owns a parcel of land in Isabela covered by TCT 8121, it was subdivided; they subdivided the land one of w/c is the subject (Lot No. 7036-A-7) herein. One of the Siblings, Rizal, sold the subject, to a certain Gamiao & Dayag, the other siblings did not object; it was never registered; instead G&D declared the property for taxation purposes in their names. On 6.28.64, G&D sold the southern half of the property to Teodora Dela Cruz, and the other half to Restituto Hernandez w/c it took possession right after and cultivated the same; Restituto donated the same to his daughter, Evangeline, on 12.28.86. On 6.15.76, the Madrid Brothers sold all their rights and interest over the subject to Pacifico Marquez, it was registered; thereafter Marquez subdivided the subject, they were issued issued new TCTs; right after, they mortgaged the lands to RBank w/c was registered; W/c they defaulted at. RBank then caused the foreclosure of the subject, bidded and won; On 10.31.85 Marquez sold to a certain Romeo Calixto. The Heirs-now respondents filed a case for reconveyance and damages for the southern portion of Lot No. 7036-A (hereafter, the subject property) against Marquez and CRB. The RTC ruled in favor of Marquez. CA reversed, hence this. Denied. Affirmed. Banks, their business being impressed with public interest, are expected to exercise more care and prudence than private individuals in their dealings, even those involving registered lands. Hence, for merely relying on the certificates of title and for its failure to ascertain the status of the mortgaged properties as is the standard procedure in its operations, we agree with the Court of Appeals that CRB is a mortgagee in bad faith. In this connection, Marquez's obstention of title to the property and the subsequent transfer thereof to CRB cannot help the latter's cause. In a situation where a party has actual knowledge of the claimant's actual, open and notorious possession of the disputed property at the time of registration, as in this case, the actual notice and knowledge are equivalent to registration, because to hold otherwise would be to tolerate fraud and the Torrens system cannot be used to shield fraud. While certificates of title are indefeasible, unassailable and binding against the whole world, they merely confirm or record title already existing and vested. They cannot be used to protect a usurper from the true owner, nor can they be used for the perpetration of fraud; neither do they permit one to enrich himself at the expense of others. Following Article 1544, in the double sale of an immovable, the rules of preference are: (a) the first registrant in good faith; (b) should there be no entry, the first in possession in good faith; and c) in the absence thereof, the buyer who presents the oldest title in good faith. Prior registration of the subject property does not by itself confer ownership or a better right over the property. Article 1544 requires that before the second buyer can obtain priority over the first, he must show that he acted in good faith throughout (i.e., in ignorance of the first sale and of the first buyer's rights) from the time of acquisition until the title is transferred to him by registration or failing registration, by delivery of possession. One who purchases real property which is in actual possession of others should, at least, make some inquiry concerning the rights of those in possession. The actual possession by people other than the vendor should, at least, put the purchaser upon inquiry. He can scarcely, in the absence of such inquiry, be regarded as a bona fide purchaser as against such possessions. The rule of caveat emptor requires the purchaser to be aware of the supposed title of the vendor and one who buys without checking the vendor's title takes all the risks and losses consequent to such failure.

Expirity & Apostol, (P) v. Valerio (R) | GR No. L-18018 | 12.26.63 | Double Sales | Dizon, J p: R went to the court to quiet title against P alleging ownership of the subject in Mangatarem, Pangasinan; that such, he acquired from Pelagia Vegilia thru a DOS. P is asserting their rights, holding that they are the owner, having acquired the subject by inheritance from Santiago Apostol (Husband) whom acquired the same from Mariano Vegilia thru a DOS, whom acquired also the same from Pelagia Vegilia in 1932. P relies on the validity of the DOS executed by Pelagia to Mariano and the DOS to his late husband. LC ruled in favour of R, w/c was upheld by the CA. Affirmed. Denied. Where the owner of a parcel of unregistered land sold it to two different parties, assuming that both sales are valid the vendee whose deed of sale was first registered under the provisions of Act 3344 would have a better right. Where the same parcel of land was sold to two different parties, it is held that, despite the fact that one deed of sale was registered ahead of the other, Art. 1544 of the Civil Code will not apply where said deed is found to be a forgery; the result of this being that the right of the other vendee should prevail. But this Court further takes into account the fact that the names Mariano Vegilia and Jose B. Aviles appearing in said Exh. '2' must have been written by only one man."

Obsequio(s)(P) v. CA & Alimpoos(s)(R) | GR No. 107967 | 3.1.94 | Double Sales | Regalado, J p: The subject herein is located in Agusan del Sur, acquired by R thru homestead application; the same is now registered to P, evidenced by a title. R sued P and the heirs of Eduardo Deguro for recovery of possession of the subject; alleging that sometime in 1964, they mortgaged the same to Deguro, together with the OCT, and they continued to cultivate 2/3rds of the subject. That as to P, claims that Deguro, w/o knowledge of R misrepresented and claimed ownership thereof and sold the same to them. Maintaining good faith. Deguros heirs now claims that the subject was sold to their parents as evidenced by a DOS, the issuance of a TCT. LC ruled in favour of P; CA reversed hence this. Reversed. Reinstated. In consonance with this accepted legal definition, petitioner Consorcia Tenio-Obsequio is a purchaser in good faith. There is no showing whatsoever nor even an allegation that herein petitioner had any participation, voluntarily or otherwise, in the alleged forgery. Nor can we charge said petitioner with negligence since, at the time of the sale to her, the land was already registered in the name of Eduardo Deguro and the tax declaration was also issued in the latter's name. It was also clearly indicated at the back of the original certificate of title that Eduardo Deguro acquired ownership over the said land by virtue of the deed of sale executed in his favor. In fact, it is not disputed that one of his heirs was actually residing therein. There is no annotation, defect or flaw in the title that would have aroused any suspicion as to its authenticity. Such being the case, petitioner has the right to rely on what appears on the face of the certificate of title. Private respondents in this case ruefully failed to substantiate with sufficient evidence their claim that their signatures appearing on the deed of sale were forged. Furthermore, it was the very act of the respondent Alimpoos spouses in entrusting their certificate of title to Eduardo Deguro that made it possible for the commission of the alleged fraud, if indeed there was such a fraudulent conduct as imputed to the latter. Hence, the rule of law and justice that should apply in this case is that as between two innocent persons, one of whom must suffer the consequences of a breach of trust, the one who made it possible by his act of confidence must bear the loss. The right of the innocent purchaser for value must be respected and protected, even if the seller obtained his title through fraud.

Cheng (P) v. Genato, Da Jose Sps. (R) | GR No. 129760 | 12.29.98 | Double Sale | Martinez, J p: Genato owned 2 parcels of land in Paradise Farms. He agreed with the Da Jose spouses to enter into a contract to sell over the said parcels; it was embodied in a public instrument annotated to the certificates of title. They asked for and were granted an extension for the payment of the purchase price. Unknown to them, Genato dealt with Cheng regarding the lot, executed an Affidavit to annul the Contract to Sell, appraised the latter of his decision to rescind the sale, and received a down payment from Cheng upon the guarantee that the said contract to sell will be annulled. By chance, Genato and the spouses met at the RD, where he again agreed to continue the contract with them. He advised Cheng of his decision; the latter countered that the sale had already been perfected. Cheng executed an Affidavit of Adverse Claim and had it annotated to the TCTs and sued for specific performance. LC Ruled in favour of P, CA Reversed. Hence this. Affirmed in TOTO. Denied. Both agreements involve a contract to sell, which makes Art. 1544 inapplicable since neither a transfer of ownership nor a sales transaction took place. A contract to sell is premised upon a suspensive conditionthe full payment of the purchase price. That being the case, the elementary principle of first in time, priority in right should apply. As such, the contract in favor of the Da Jose spouses must prevail considering that the same had not been validly rescinded. Cheng cannot be considered to have acted in good faith as he had knowledge of the prior transaction in favor of the spouses. Notwithstanding this contrary finding with the appellate court, we are of the view that the governing principle of Article 1544, Civil Code, should apply in this situation. Jurisprudence teaches us that the governing principle is PRIMUS TEMPORE, PORTIOR JURE (first in time, stronger in right). This principle only applies when the special rules provided in the aforecited article of the Civil Code do not apply or fit the specific circumstances mandated under said law or by jurisprudence interpreting the article. The rule exacted by Article 1544 of the Civil Code for the second buyer to be able to displace the first buyer are: (1) that the second buyer must show that he acted in good faith (i.e., in ignorance of the first sale and of the first buyer's rights) from the time of acquisition until title is transferred to him by registration or failing registration, by delivery of possession; (2) the second buyer must show continuing good faith and innocence or lack of knowledge of the first sale until his contract ripens into full ownership through prior registration as provided by law. Carbonell (P) v. CA, Poncio & Sps. Infante (R) | GR No. L-29972 | 1.26.76 | Double Sales | Makasiar, J p: On 1.27.55, Jose Poncio executed a private memorandum of sale of the property in question in favor of P. 4 days later, or an 1.31.555, Poncio in a private memorandum bound himself to sell the property for an improved price to Sps. R, and on February 2, 1955, he executed a formal registerable deed of sale in her (Infante's) favor. When P saw the seller Poncio a few days afterwards, bringing the formal deed of sale for the latter's signature and the balance of the agreed cash payment, she was told that he could no longer proceed with formalizing the contract with her (Carbonell) because he had already formalized a sales contract in favor of Infante. Since p did not have a formal registerable deed of sale, she did the next best thing to protect her legal rights and registered on 2.8.55 with the Register of Deeds her adverse claim as first buyer entitled to the property. The second buyer registered the sale in her favor with the Register of Deeds only on 2.12.55, so that the transfer certificate of title issued in her favor carried the duly annotated adverse claim of Carbonell as the first buyer. LC ruled in favour R Sps, CA at first reversed, but later ruled anew. Hence this. The Supreme Court reversed the decision of the Special Division of Five of the Court of Appeals and declared the first buyer Rosario Carbonell to have the superior right to the land in question. The buyer of realty must act in good faith in registering his deed of sale to merit the protection of the second paragraph of Article 1544 of the New Civil Code. Unlike the first and third paragraphs of said Article which accords preference to the one who first takes possession in good faith of personal or real property, the second paragraph directs that ownership of immovable property should be recognized in favor of one "who in good faith recorded" his right. Under the first and third paragraphs, good faith must characterize prior possession. Under the second paragraph, good faith must characterize the act of anterior registration. If there is no inscription, what is decisive is prior possession in good faith. If there is inscription, prior registration in good faith is a pre-condition to support title. Where the first buyer was not aware - and could not have been aware - of any sale to another person as there was no such sale, the buyer's prior purchase of the land was made in good faith. Her good faith subsisted and continued to exist when she recorded her adverse claim four days prior to the registration of the second buyer's deed of sale. The first buyer's good faith did not cease after the seller told her of his second sale of the same lot to the second buyer. By reason thereof, she has superior right to the land in question.Adalin(s), Calingasan & Adaya (P) v. CA, Faustino Yu et al. (R) | GR No. 120191 | 10.10.97 | Double Sales | Hermossisima, J p: R Kado decided to sell their land thru Bgy. Captain Palanca to R Yu; before that a meeting was held w/ the tenants of the apartment; the Adalin unequivocally answered that he and the other tenants were not interested mainly. The DOCS was prepared, but not to be executed until tenants have been evicted; On a later date, however, the tenants refused to vacate the property and informed the owners that they have decided to purchase the doors that they were leasing. Almost instantly, Palanca, in behalf of the Kado siblings, accepted the offer and returned the downpayments of the private respondents Yu and Lim. Although the latter refused to accept the reimbursements, the Kado siblings signed a "Deed of Sale of Registered Land" with the tenants Magno Adalin, Demetrio Adaya, and Carlos Calingasan; then the tenants immediately tried to register the same to the ROD and TCTs were issued; then the suing. LC ruled in favor of the tenants. CA reversed. Hence this, P assailing that the transaction entered into by R Yu and Lim with R Kado siblings was an absolute sale and not merely a conditional sale as denominated by the document. The Supreme Court dismissed the instant petition. The Court ruled that Palanca and the tenants were estopped from denying their earlier statement that the tenants had no intention of buying the other four doors of the apartment that they were leasing. In this sense, the Deed of Conditional Sale may be an accurate denomination of the transaction. But the sale was conditional only inasmuch as there remained yet to be fulfilled the obligation of the sellers to eject their tenants and the obligation of the buyers to pay the balance of the purchase price. The choice of who to sell the property to, however, had already been made by the sellers and is thus no longer subject to any condition nor open to any change. In that sense, therefore, the sale made by Palanca to private respondents was definitive and absolute. The subsequent sale of the subject property by Palanca to the said tenants smacks of gross bad faith, considering that Palanca and the said tenants were in full awareness of the August and September negotiations between Bautista and Palanca, on the one hand, and Loreto Adalin Faustino Yu and Antonio Lim, on the other, for the sale of the one-storey building. Notwithstanding their full knowledge of the subsistence of the earlier sale over the same property to private respondents Yu and Lim. It goes without saying, thus, that though the second sale to the said tenants was registered, such prior registration cannot erase the gross bad faith that characterized such second sale, and consequently, there is no legal basis to rule that such second sale prevails over the first sale of the said property to private respondents Yu and Lim.

Dichoso et al (PA) v. Roxas et al (D) & Borja & Alanguilan (DA) | GR No. L-17441 | 7.31.62 | Double Sales | Dizon, J p: Roxas sold to Dichoso and Hernandez a parcel of unregistered coconut land, subject to the condition that the vendor could repurchase the land within 5 years from the date of sale. Roxas received from Dichoso several sums of money as initial or advance payments, with the agreement that Roxas would sell the same property, by absolute sale, to Dichoso. Out of their remaining balance, they would use P850 to repurchase the property from Borja and Alanguilan within the period stipulated. Dichoso informed Borja of their readiness to repurchase and sent Roxas a check. Roxas returned the check with the request that they indorsed it to Borja and Alanguilan when they make the repurchase. Despite the repeated demands and representations, Roxas and Borja had deliberately failed to execute the corresponding deed of absolute sale and deed of resale. LC ruled in favour of PA, CA reversed hence this. It appears from the evidence that Laura A. Roxas had sold her rights to the land in controversy to two different parties. The first one was on July 5, 1957 in favor of the plaintiffs Welgo Dichoso and Emilia Hernandez (Exhibit 'I'), and the second one allegedly of December 8, 1957 in favor of defendants Celso Borja and Nelia Alanguilan (Exhibit '7') The contract between the petitioners and Roxas was a mere promise to sell because Roxas merely promised to execute a deed of absolute sale upon Dichosos completion of payment. On the date that Roxas could possibly sell sell or convey in relation to the property in question was her right to repurchase the same from Borja. The private document executed between Roxas and Dichoso can be considered as an assignment by Roxas to Dischoso of her right to repurchase which Roxas only had knowledge thereof when Dichoso attempted to make the repurchase. Such being its condition, it could not possibly give rise to the case of one and the same property having been sold to two different purchasers. The sale in favor of Borja was of the property itself, while the one in favor of Dichoso, if not a mere promise to assign, was at most an actual assignment of the right to repurchase the same property. Art. 1544, par. 3 of the CC do not apply. The provisions of paragraph 3, Article 1544 of the Civil Code of the Philippines, do not apply to a case where the sale in favor of one party was of the property itself, while the transaction in favor of another was either a mere promise to assign or, at most, an actual assignment of the right to repurchase the same property.

Cruzado (PA) v. Bustos & Escaler (DA) | GR No. 10244 | 2.29.16 | Double Sales | Torres, J p: Agapito Cruzado was a poor man living in Pampanga, he had a job in court but was still not enough to support his family. He aspired to hold the office of procurador in the CFI of Pampanga but he was unable to give the required bond, an indispensable condition for his appointment. Since Cruzado was friends with Bustos, a rich woman in their place. He begged the latter to simulate a mortgage deed of a certain property and have it executed in court in his favor only to pose that he has real property to enable him to qualify to such position of procurador. In truth, the said mortagage was a front and fraudulent but was effected by making a pretended contract which bore the appearance of truth. It is unquestionable that the contract of sale was perfect and binding upon both contracting parties since their names both appear in that instrument to have agreed upon the thing sold. But it is also undeniable that the said contract was not consummated. 1.) Cruzado did not pay the purchase price of P2,200.00; and 2.) He never took possession of the land apparently sold in the said deed. All that the vendee did was to pledge the land as a security for the faithful discharge of the duties of his office. When he died. Santiago Cruzado, the son, brought an action for recovery of possession, founded on the right transmitted to him by his father at his death a right arising from the said simulated deed of sale of the land in question. LC resolved for DA. Hence this. Affirmed. The legal fiction of the delivery, by the vendor to the vendee, of the public instrument executed for the purpose, instead of the tradition or possession of the thing sold, produces no effect, nor is the sale consummated, if the vendee does not take possession of the thing and pay the price thereof. (Arts. 1258 and 1450, Civil Code; and decisions of the supreme court of Spain of January 19, 1898, June 1, 1900, and March 8, 1901.) Such contract was perfect and binding upon both contracting parties, it appearing in the public instrument executed for the purpose that the vendor and the vendee agreed upon the property sold and on the price stipulated; but such contract cannot be considered to have been consummated, unless it is proved that the purchaser paid the price and took possession of the property. Even though the said fictitious deed of sale be considered valid and effective, as being a perfect and binding contract between the contracting parties, yet when the vendee has not paid the price nor taken possession of the property which continued in the possession of the vendors until they later sold it to a third person, such contract cannot give rise to an action for the recovery of possession. Such an action arises from a consummated contract and the contract is what confers a title which transfers the ownership.