Rivera v. Tirona
REITERATIONFacts
The Antecedents: Diego D. Rivera was the registered owner of a parcel of land. On December 8, 1944, he sold the property to Tomas T. Tirona with a right to repurchase within six months for P25,000. Diego D. Rivera remained in possession under a lease agreement. Within the repurchase period, Diego D. Rivera attempted to repurchase the property, but Tirona refused. Diego D. Rivera filed a complaint (Civil Case No. 3120) with the Court of First Instance of Manila, consigning the repurchase price. A notice of lis pendens was filed on January 12, 1945. Despite this, Tirona sold the property to Jose K. Lapuz on January 20, 1945. Lapuz purchased the land based on Rivera's deed of sale to Tirona and a clean Torrens title. After Rivera's title was cancelled, a new title was issued in Lapuz's name. The Court of First Instance of Manila ruled in favor of Rivera, granting him the right to repurchase. This decision was affirmed by the Court of Appeals, which declared Rivera the owner and ordered Tirona to surrender his title. The decision became final on January 26, 1950. Procedural History: Upon attempting to enforce the judgment, Diego D. Rivera discovered the property was no longer in Tirona's name but had been sold to Jose K. Lapuz, who subsequently sold it to his mother, Concepcion Kerr. Carlos J. Rivera, as judicial administrator of Diego D. Rivera's estate (Diego having since died), instituted the present proceedings to cancel Concepcion Kerr's title. The Court of First Instance of Rizal rendered a decision ordering Concepcion Kerr to surrender the owner's copy of the title for cancellation and issuance of a new one in the name of the estate. The complaint against Tomas T. Tirona and Jose K. Lapuz was dismissed, as were the counterclaims. Costs were awarded against Concepcion Kerr. The Petition: Jose K. Lapuz and Concepcion Kerr appealed the decision of the Court of First Instance of Rizal.
Issue(s)
Was Jose K. Lapuz a purchaser in good faith? Was Concepcion Kerr a purchaser in good faith? What is the legal effect of a notice of lis pendens entered in the Day Book on subsequent purchasers?
Ruling
The decision of the Court of First Instance of Rizal is affirmed. Concepcion Kerr is ordered to surrender the owner's copy of Transfer Certificate of Title No. 1305 (47406) to the Register of Deeds of Rizal for cancellation and the issuance of a new title in the name of the estate of Diego D. Rivera. Costs are assessed against Concepcion Kerr.
Ratio Decidendi
On Issue 1: Was Jose K. Lapuz a purchaser in good faith? The Supreme Court ruled that Jose K. Lapuz was not a purchaser in good faith. The Court emphasized that one who buys land from a person who is not the registered owner is not considered a "subsequent purchaser of registered land who takes the certificate of title for value and in good faith and who is protected against any encumbrance except those noted on said certificate," citing Revilla et al. vs. Galindez. Lapuz merely relied upon the title still in the name of Diego D. Rivera and the deed of sale from Rivera to Tirona, which was not annotated on the title. Moreover, Lapuz was aware that Diego D. Rivera was still in possession of the land, a circumstance that should have prompted further inquiry into the right of his transferor, Tirona, to sell the property. His failure to investigate, coupled with his sworn statement that his purchase would not prejudice third parties to secure a new title, demonstrated a lack of good faith in both the purchase and the registration of the property in his name, per Dir. of Lands vs. Addison. On Issue 2: Was Concepcion Kerr a purchaser in good faith? The Supreme Court found that Concepcion Kerr, like her son Jose K. Lapuz, could not be considered a purchaser for value and in good faith. The Court noted several reasons to believe her purchase was simulated or fictitious. She resided in the same house as her son at the time of the alleged sale, and her title was issued based on her son's misrepresentation that the sale would not prejudice any third party. Furthermore, Kerr did not appear or testify at the hearing, indicating a lack of genuine interest in the property. The Court also mentioned the allegation that the title was transferred to her so she could use it as security for her son's bail bond in a treason case, further suggesting the transaction was not a legitimate, good faith purchase. On Issue 3: What is the legal effect of a notice of lis pendens entered in the Day Book on subsequent purchasers? The Supreme Court held that the notice of lis pendens for Civil Case No. 3120, filed on January 12, 1945, in the office of the Register of Deeds and entered in the Day Book, constituted sufficient notice to defendants Lapuz and Kerr as subsequent purchasers. The Court reiterated the principle established in Levin vs. Bass, et al., stating that "in involuntary registration, such as an attachment, levy on execution, lis pendens and the like, entry thereof in the Day Book is a sufficient notice to all persons of such adverse claim." It explicitly clarified that it is not necessary for the notice of lis pendens to be annotated at the back of the owner's certificate of title in involuntary transactions, distinguishing it from voluntary transactions where such annotation is required. The Court also presumed the Register of Deeds performed their official duty to annotate the notice on the original certificate of title. Consequently, having purchased the property subsequent to the recording of the notice of lis pendens, Lapuz and Kerr were deemed transferees pendente lite, standing in the shoes of Tirona and bound by the judgment against him, as established in cases like Correa vs. Pascual, et al. and Director of Lands, et al. vs. Martin, et al.
Main Doctrine
A notice of lis pendens, duly entered in the Day Book of the Register of Deeds, constitutes sufficient notice to subsequent purchasers of any adverse claim involving the property, even if it is not annotated on the owner's certificate of title, and such purchasers are considered transferees pendente lite, bound by the judgment against their transferor.