GARCIA VS. COURT OF APPEALS GR NO. L-48971, January 22, 1980 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:
Whether or not the 1920 Lapus title prevails over the 1963 Rivera title and subsequent titles derived from it?
RULING:
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.
Angeles vs Sec of Justice G. R. No. 142549, July 29, 2005
DOCTRINE:The purpose of registration of the contract of partnership with the SEC is to give notice to third parties. Failure to register the contract of partnership does not affect the liability of the partnership and of the
partners to third persons, nor does it affect the partnership‘s juridical personality. A partnership may exist even if the partners do not use the words ―partner‖ or ―partnership.‖
FACTS:
Angeles spouses filed a criminal complaint for estafa against Mercado, their brother-in-law claimed that Mercado convinced them to enter into a contract of antichresis, to last for 5 years, covering 8 parcels of land planted with fruit-bearing lanzones trees in Nagcarlan, Laguna and owned by Juan Sanzo. The parties agreed that Mercado would administer the ands and complete the necessary paperwork. After 3 years, the Angeles spouses asked for an accounting from Mercado, and they claim that only after this demand for an accounting did thy discover that Mercado had put the contract of antichresis over the subject land under Mercado and his spouse‘s names. Mercado denied the Angeles spouses‘ allegations claimed that there exists an industrial partnership, colloquially known as sosyo industrial, between him and his spouse as industrial partners and the Angeles spouses as financiers, and that this had existed since 1991, before the contract of antichresis over the subject land Mercado used his and his spouse‘s earnings as part of the capital in the business transactions which he entered into in behalf of the Angeles spouses. It was their practice to enter into business transactions with other people under the name of Mercado because the Angeles spouses did not want to be identified as the financiers
attached bank receipts showing deposits in behalf of Emerita Angeles and contracts under his name for the Angeles spouses.
During the barangay conciliation proceedings, Oscar Angeles stated that there was a written sosyo industrial agreement: capital would come from the Angeles spouses while the profit would be divided evenly between
Mercado and the Angeles spouses Provincial Prosecution Office: first recommended the filing of a criminal information for estafa, but after Mercado filed his counter-affidavit and moved for reconsideration, issued an amended resolution dismissing the complaint Angeles spouses appealed to Sec. of Justice, saying that the document evidencing the contract of antichresis executed in the name of the Mercado spouses, instead of the Angeles spouses, and that such document alone proves Mercado‘s misappropriation of their P210, 000
Secretary of Justice: dismissed the appeal
o Angeles spouses failed to show sufficient proof that Mercado deliberately deceived them in the transaction
o Mercado satisfactorily explained that the Angeles spouses do not want to be revealed as the financiers
o Under the circumstances, it was more likely that the Angeles spouses knew from the very start that the questioned document was not really in their names
o A partnership truly existed between the Angeles spouses and Mercado, which was clear from the fact that they contributed money to a common fund and divided the profits among themselves.
o Angeles spouses acknowledged their joint business venture in the barangay conciliation proceedings although they assailed the manner the business was conducted
o Although the legal formalities for the formation were not adhered to, the partnership relationship was evident.
o There is no estafa where money is delivered by a partner to his co-partner on the latter‘s representation that the amount shall be applied to the business of their partnership. In case of the money received, the co-partner‘s liability is civil in nature
ISSUES:
1. Whether or not the Sec. of Justice committed grave abuse of discretion in dismissing the appeal - No
2. Whether or not a partnership existed between Mercado and the Angeles spouses - Yes
3. Whether or not there was misappropriation by Mercado – No
RULING:
1. Angeles spouses fail to convince that the Secretary of Justice committed grave abuse of discretion when he dismissed their appeal.
Moreover, they committed a procedural error when they failed to file a motion for reconsideration of the Sec. of Justice‘s resolution, which is already enough reason to dismiss the case.
2. Angeles spouses allege that they had no partnership with Mercado, relying on Arts. 1771 to 1773 of the Civil Code. The Angeles spouses‘
position that there is no partnership because of the lack of a public
instrument indicating the same and a lack of registration with the SEC holds no water. The Angeles spouses contributed money to the partnership and not immovable property. Mere failure to register the contract of partnership with the SEC does not invalidate a contract that has the essential requisites of a partnership. The purpose of registration is to give notice to third
parties. Failure to register does not affect the liability of the partnership and of the partners to third persons, nor does it affect the partnership‘s juridical personality. The Angeles spouses admit to facts that prove the existence of a partnership. A contract showing a sosyo industrial or industrial partnership.
Contribution of money & industry to a common fund division of profits between the Angeles spouses and Mercado.
3. Mercado satisfactorily explained that the Angeles spouses do not want to be revealed as the financiers, thus the document which was in the name of Mercado and his spouse fail to convince that there was deceit or false
representation that induced the Angeles spouses to part with their money.
Even the RTC of Sta. Cruz, Laguna, which handled the civil case filed by the Angeles spouses against Mercado and Leo Cerayban stated that it was the practice to have the contracts secured in Mercado‘s name as the Angeles spouses fear being kidnapped by the NPA or being questioned by the BIR as Oscar Angeles was working with the government.
TITLES FROM VOID TITLES ARE ALSO VOID