Tuesday, January 16, 2018
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Property rules

No one can give what one does not have

The five Maniego brothers were registered owners of a big lot in Isabela. They subdivided the lot, and one of the resulting subdivision lots was Lot No. 70.

Rizo Maniego sold part of his share in Lot No. 70 to Gay and Day by virtue of a deed of sale. In a Joint Affidavit, the other Maniego brothers did not object to the sale.

The Rizo-Gay-Day deed of sale, however, was not registered with the Office of the Register of Deeds. Gay and Day later declared the property for taxation purposes in their names.

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Years after, Gay and Day sold the southern half of Lot No. 70 to Teddy, and the northern half to Resty. Teddy and Resty took possession of and cultivated the portions of the property. Later, Resty donated the lot to Vangie. The children of Teddy continued possession of the southern half after their father’s death.

Unknown to Teddy and Resty, the Maniego brothers sold Lot 70 to Pacquing. At the time he bought the property, Pacquing knew that the families of Teddy and Resty lived and cultivated the land.

While he did not demand the families to vacate Lot 70, Pacquing made sure that his deed of absolute sale was registered with the Office of the Register of Deeds.

Subsequently, Pacquing further subdivided Lot 70 into several parts. He mortgaged five of the subdivided lots to a bank to secure a loan he obtained from the latter. These deeds of real estate mortgage were registered with the Office of the Register of Deeds. Pacquing also sold one of the subdivided lots to Romy, his neighbor.

As Pacquing defaulted in the payment of his loan, the bank caused the foreclosure of mortgages in its favor and the lots were sold to the highest bidder.

Years later, the heirs of Teddy and Resty found out that the property their respective fathers bought was foreclosed by the bank and a portion thereof sold to Romy. Claiming that the transactions involving Lot 70 were null and void, the heirs of Teddy and Resty filed a case for reconveyance and damages against against Pacquing, Romy and the banks.

Insisting that this is a case of double sale, Pacquing maintained that he has a better right over the heirs being the first registrant and a buyer in good faith and for value.

He opined that the sale executed by Rizo Maniego to Gay and Day was not binding upon him, it being unregistered.

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The bank insisted that it was a mortgagee in good faith and that it had the right to rely on the titles of Pacquing which were free from any lien or encumbrance. Romy, on the other hand, claimed that he cannot be held liable for anything as Pacquing reacquired the portion sold to him.

Q: Is this a case of double sale?

A:  No. The rule on double sale as provided in Article 1544 of the Civil Code states that:

If the same thing should have been sold to different vendees, the ownership shall be transferred to the person who may have first taken possession thereof in good faith, if it should be movable property.

Should it be immovable property, the ownership shall belong to the person acquiring it who in good faith first recorded it in the Registry of Property.

Should there be no inscription, the ownership shall pertain to the person who in good faith was first in possession; and, in the absence thereof, to the person who presents the oldest title provided there is good faith.

Art. 1544 is not applicable in the present case. It contemplates a case of double or multiple sales by a single vendor.

It covers a situation where a single vendor sold one and the same immovable property to two or more buyers.

Here, the subject property was not transferred to several purchasers by a single vendor.

In the first deed of sale, the vendors were Gay and Day whose right to the subject property originated from their acquisition thereof from Rizo Maniego with the conformity of all the other Maniego brothers, followed by their declaration of the property in its entirety for taxation purposes in their names.

On the other hand, the vendors in the other or later deed were the Maniego brothers but at that time they were no longer the owners since they had long before disposed of the property in favor of Gamy and Day.

Q: Will the registration of the Maniego-Pacquing deed of absolute sale with the Office oif the Register of Deeds defeat the claim of the heirs of Teddy and Resty?

A: No. In a situation where the rule on double sale will not apply, the principle of prior tempore, potior jure or simply “he who is first in time is preferred in right,” should apply.

The only essential requisite of this rule is priority in time; in other words, the only one who can invoke this is the first vendee. Undisputedly, he is a purchaser in good faith because at the time he bought the real property, there was still no sale to a second vendee.

In the instant case, the sale to the Heirs by Gay and Day, who first bought it from Rizo, was anterior to the sale by the Maniego brothers to Pacquing.

The heirs of Gay and Day also had possessed the subject property first in time.

Thus, applying the principle, the heirs have a superior right to the subject property.

One must remember that no one can give what one does not have. Accordingly, one can sell only what one owns or is authorized to sell, and the buyer can acquire no more than what the seller can transfer legally.

In this case, since the Maniego brothers were no longer the owners of the subject property at the time of the sale to Pacquing, the latter did not acquire any right to it.

Q:  Will the fact that the property had already been titled in the name of Pacquing defeat the claims of the heirs of Teddy and Resty?

A: No. Pacquing’s obstention of title to the property and the subsequent transfer thereof to the banks cannot defeat the claim of the heirs of Teddy ad Resty.

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. (Source: Consolidated Rural Bank (Cagayan Valley, Inc. vs. CA, G.R. No. 132161, January 17, 2005)

Ma. Soledad Deriquito-Mawis Dean, College of Law, Lyceum of the Philippine University Chairperson, Philippine Association of Law Schools Attorney-at-Law

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