Lichauco v. Berenguer
REITERATIONFacts
The Antecedents: On July 26, 1882, Macario Berenguer sold a parcel of land with right of repurchase to Cristino Singian. On October 7, 1889, Macario Berenguer sold the same land with right of repurchase to Cornelia Lauchangco, stipulating that Berenguer would lease the land back, paying annual rent, and that the fruits would be applied to the repurchase price. This sale was registered in 1907. On September 2, 1890, Macario Berenguer again sold the land with pacto de retro to Cristiano Singian, with the amount paid in the 1882 sale considered part of the price. Cristiano Singian accepted this purchase in representation of Anselmo Singian, his ward. On February 20, 1904, Anselmo Singian sold the land absolutely to Macario Berenguer, stipulating that if the price was not fully paid within eight years, ownership would revert to Anselmo Singian. Procedural History: The heirs of Cornelia Lauchangco (plaintiffs) sued Jose Berenguer (administrator of Macario Berenguer's estate) and Anselmo Singian (defendants). The plaintiffs sought to have the sale to Cornelia Lauchangco declared absolute or to recover the repurchase price and rents. Jose Berenguer prayed for dismissal and for the plaintiffs to execute the repurchase document in his favor. Anselmo Singian prayed for the sale to Lauchangco to be declared void and for himself to be declared absolute owner. The trial court absolved the defendants, and the plaintiffs appealed. The Petition: The plaintiffs appealed the trial court's decision, arguing for the validity and preference of the sale to Cornelia Lauchangco.
Issue(s)
Which of the two sales, the one to Cristino Singian (or Anselmo Singian) or the one to Cornelia Lauchangco, should be preferred in case of double sale? Whether Anselmo Singian acquired ownership of the land by prescription. Whether the sale from Anselmo Singian to Macario Berenguer in 1904 affects the ownership of the land.
Ruling
The Supreme Court affirmed the judgment of the trial court, absolving the defendants from the complaint. The Court held that the sale to Anselmo Singian, represented by his tutor Cristino Singian, was valid and transferred ownership. Even disregarding the sale, Anselmo Singian acquired ownership by prescription. Therefore, the complaint against the defendants was deemed improper.
Ratio Decidendi
On the preferred sale in case of double sale: The Court reiterated the principle that in cases of double sale where neither instrument was inscribed prior to the Civil Code, preference is given to the purchaser who first took possession of the land. This possession, under the law then in force, constituted the consummation of the contract. Article 1473 of the Civil Code also expressly provides that possession transfers ownership in such cases. The Court found that Anselmo Singian, through himself and his representative, took possession of the land since the 1882 sale and continued in possession. Even if both vendees took possession through the vendor as lessee, the possession by the vendor after the sale is considered possession by the vendee. In this scenario, the preference would still favor the first vendee, Cristino Singian, who first enjoyed such possession. Furthermore, the Court noted that Cornelia Lauchangco did not acquire juridical possession because Macario Berenguer, her vendor and lessee, was himself a mere lessee of the prior vendee, Cristino Singian, and thus his possession was not for himself but in representation of Singian. Even if possession through stipulation of lease was not considered sufficient, preference would still be given to the earlier sale to Cristino Singian based on its prior date, as per Article 1473 of the Civil Code. On acquisition of ownership by prescription: The Court found that by 1907, when the sale to Lauchangco was registered, twenty-five years had elapsed since Singian took possession of the land. Thus, Singian had acquired ownership by prescription. The registry of the sale to Lauchangco in 1907 could not alter this fact, as prescription vests ownership independently of registration. The registry could destroy the efficacy of the sale as a title against unregistered sales, but not the legal effects of possession and the title acquired by prescription. On the effect of the 1904 sale to Macario Berenguer: The Court stated that the sale of the land by Anselmo Singian to Macario Berenguer in 1904 did not affect the merits of the case concerning the prior sales. In this 1904 sale, it was stipulated that ownership would revert to Anselmo Singian if the price was not fully paid within eight years. As it did not appear that any payment was made, and such payment would need to be proven by the obligor, the Court accepted as a fact that no payment was made. Consequently, after the expiration of the eight-year period without payment, ownership reverted to the vendor, Anselmo Singian. This reversion further solidified Anselmo Singian's claim to ownership, independent of the earlier sales and registration issues.
Main Doctrine
In cases of double sale without inscription, preference is given to the purchaser who first took possession of the land. If possession is not clearly established, preference is given to the earlier sale. Ownership can also be acquired by prescription.