Caviles v. Bautista
REITERATIONFacts
1. The Antecedents: The underlying dispute concerns ownership of a property originally owned by Renato C. Plata. Spouses Alendry and Flora Caviles, Jr. (petitioners) filed a collection case against Plata and obtained a writ of preliminary attachment on his property, covered by Transfer Certificate of Title (TCT) No. S-33634. The notice of attachment was entered in the Register of Deeds' Primary Entry Book on October 6, 1982. However, this attachment was not annotated on the title. Subsequently, on October 18, 1982, Plata sold the property to spouses Evelyn and Ramon Bautista (respondents), who obtained a new title, TCT No. 57006, in their names, free from any annotation of the attachment. 2. Procedural History: After obtaining a favorable judgment in their collection case on September 30, 1983, the petitioners attempted to execute it. A levy on execution was effected on February 21, 1984, and the property was sold on execution to the petitioners on March 30, 1987. When they sought to inscribe the certificate of sale, they discovered the property was already titled in the respondents' names. The petitioners then initiated proceedings to compel the surrender of the owner's duplicate copy of TCT No. 57006 for annotation, invoking Section 107 of Presidential Decree No. 1529. The Regional Trial Court of Makati, Branch 145, ruled in favor of the petitioners, ordering the surrender of the title and its cancellation. However, the Court of Appeals reversed this decision, dismissing the petition and upholding the respondents' title. 3. The Petition: The petitioners seek review of the Court of Appeals' decision, arguing that their prior entry of attachment in the Day Book, despite the lack of annotation on the title, should prevail over the respondents' registered title acquired later. They contend that in cases of involuntary registration, entry in the day book is sufficient notice. The petitioners are asking the Supreme Court to resolve the conflict between their right arising from the duly entered notice of attachment and the respondents' right based on their registered title, asserting that their execution sale retroacts to the date of the attachment's inscription, giving them superior rights.
Issue(s)
Whether the entry of a notice of attachment in the Primary Entry Book, without annotation on the original title, prevails over a subsequent sale to an innocent purchaser for value whose title was duly registered. Whether the levy on execution sale retroacts to the date of the inscription of the notice of attachment in the Day Book.
Ruling
The Supreme Court set aside the decision of the Court of Appeals and affirmed the decision of the Regional Trial Court, ruling in favor of the petitioners (Caviles spouses).
Ratio Decidendi
On the issue of whether the entry of a notice of attachment in the Primary Entry Book, without annotation on the original title, prevails over a subsequent sale to an innocent purchaser for value whose title was duly registered: The Court held that in involuntary registration, such as an attachment, entry in the Day Book or Primary Entry Book is sufficient notice to all persons of an adverse claim. Petitioners paid the fees for annotation and had the right to presume the Register of Deeds would perform their duty. The Court reiterated that a party who delivers a notice of attachment to the Register of Deeds and pays the fees has a right to presume the official would perform their duty properly, citing Director of Lands vs. Abad. The Court further stated that in involuntary registration, entry in the day book is sufficient notice to all persons of such adverse claim, citing Levin vs. Bass. While annotation on the original title is required, this is an official duty of the Register of Deeds, which may be presumed to have been regularly performed. The Court emphasized that current doctrine holds that entry alone produces the effect of registration for both voluntary and involuntary transactions, provided the registrant has complied with all requirements for entry and annotation, and nothing more remains to be done but a duty incumbent solely on the Register of Deeds, citing DBP vs. Acting Register of Deeds of Nueva Ecija. Therefore, the petitioners' lien of attachment was properly recorded when entered in the primary entry book on October 6, 1982. On the issue of whether the levy on execution sale retroacts to the date of the inscription of the notice of attachment in the Day Book: The Court affirmed that an auction or execution sale retroacts to the date of the levy of the lien of attachment. When the subject property was sold on execution to the petitioners, this sale retroacted to the date of inscription of petitioners' notice of attachment on October 6, 1982. The earlier registration of the petitioners' levy on preliminary attachment gave them superiority and preference in rights over the attached property as against the respondents. Consequently, the execution sale in favor of the Caviles spouses was anterior and superior to the sale of the same property to the Bautista spouses on October 18, 1982. The right of petitioners to the surrender of the owner's duplicate copy of TCT No. 57006 for inscription of the certificate of sale, and for the cancellation of said certificate of title and the issuance of a new title in favor of petitioners, cannot be gainsaid.
Main Doctrine
Involuntary registration, such as an attachment or levy on execution, is considered registered when entered in the Day Book or Primary Entry Book, and this entry is sufficient notice to all persons of such adverse claim, giving it preference over subsequent voluntary transactions, even if the annotation on the original title has not yet been completed by the Register of Deeds.