Joe Pallugna
THERE are several confusions on the rules and the exceptions in double sale of land result in conflicting claims. Here is a case of double sale.
Martino owned a parcel of land coved by OCT No. P-429 with an area of 18,214 square meters. In 1960, he sold his land to Purificacion, who then got the land title but she did not register the land with the Register of Deeds.
Purificacion later on sold the land to Pono, to whom the land title was delivered but Pono did not also register the sale with the ROD. Pono, however took possession of the land and allowed his son to construct a house on the land and he developed the land.
Several years later, the original owner, Martino, sold the same land to his grandson Esmeraldo, but of course Martino was not able to deliver the land title to Esmeraldo, as the title was already with Pono.
Esmeraldo filed a petition for issuance of new land title claiming that the original owner Martino could not find his title. Pono obtained a new land title and then filed a case for quieting of title and recovery of possession against Pono. Martino claimed that he was a buyer in good faith as the land title is clean and he merely relied on the clean title. The RTC granted his petition against Pono.
On appeal by Pono to the Court of Appeals, the CA reversed the RTC ruling that Esmeraldo was not a buyer in good faith. Esmeraldo appealed to the Supreme Court.
In the case of Esmeraldo Vallido versus Elmer Pono, et al, G.R. No. 200173, April 15, 2013, the Supreme Court held that the CA is correct:
“It is undisputed that there is a double sale and that the respondents are the first buyers while petitioners are the second buyers. The burden of proving good faith lies with the second buyer which is not discharged by simply invoking the ordinary presumption of good faith.”
“Although it is a recognized principle that a person dealing on a registered land need not go beyond its certificate of title, it is also a firmly settled rule that there are circumstances which would put a party on guard and prompt him to investigate or inspect the property being sold to him, such as the present occupants thereon, it is expected from the purchaser of a valued piece of land to inquire first into the status or nature of the possession of the occupants..… The failure of a prospective buyer to take such precautionary steps would mean negligence on his part and would preclude him from claiming or invoking the rights of a ‘purchaser in good faith’. It has been held that the registration of a later sale must be done in good faith to entitle the registrant to priority in ownership over the vendee in an earlier sale.”
The High Court also noted that Esmeraldo is a grandson of Martino and that this circumstance makes Esmeraldo privy to the first sale. Moreover, the Supreme Court noted well enough that Martino had no land title anymore when he sold the land to Esmeraldo, and this should have prompted Esmeraldo to investigate further on the whereabouts of the land title.
In this set of facts, another exception was laid down on when the buyer cannot claim good faith by merely relying on a clean land title.
E-mail: joepallugna@yahoo.com