SPOUSES NOEL AND JULIE ABRIGO vs.

ROMAN A DE VERA DOCTRINE: Between two buyers of the same immovable property registered under the Torrens system, the law gives ownership priority to (1) the first registrant in good faith; (2) then, the first possessor in good faith; and (3) finally, the buyer who in good faith presents the oldest title. This provision, however, does not apply if the property is not registered under the Torrens system. FACTS: Gloria Villafania sold a house and lot located at Banaoang, Mangaldan, Pangasinan to Rosenda Tigno-Salazar and Rosita Cave-Go. The said sale became a subject of a suit for annulment of documents between the vendor and the vendees. The RTC rendered judgment approving the Compromise Agreement submitted by the parties. o In the decison, Gloria Villafania was given one year from the date of the Compromise Agreement to buy back the house and lot, and failure to do so would mean that the previous sale in favor of Rosenda Tigno-Salazar and Rosita Cave-Go shall remain valid and binding and the plaintiff shall voluntarily vacate the premises without need of any demand. Gloria Villafania failed to buy back the house and lot, so the [vendees] declared the lot in their name. Unknown to Rosenda Tigno-Salazar and Rosita Cave-Go, Gloria Villafania obtained a free patent over the parcel of land involved. Subsequently, Rosenda Tigno-Salazar and Rosita Cave-Go, sold the house and lot to the Spouses Noel and Julie Abrigo. Gloria Villafania sold the same house and lot to Romana de Vera. Romana de Vera registered the sale and as a consequence, a TCT was issued in her name. Romana de Vera filed an action for Forcible Entry and Damages against Spouses Abrigo before the MTC of, Pangasinan. The parties therein submitted a Motion for Dismissal in view of their agreement in the instant case that neither of them can physically take possession of the property in question until the instant case is terminated. Hence the ejectment case was dismissed. Spouses Abrigo filed the instant case RTC of Dagupan City, for the annulment of documents, injunction, preliminary injunction, restraining order and damages against respondent and Gloria Villafania. RTC rendered a decision awarding the properties to Spouses Abrigo as well as damages. In addition, Gloria Villafania was ordered to pay Spouses Abrigo and De Vera damages and attorneys fees. De Vera appealed to the CA.

CA rendered a decision: o A void title could not give rise to a valid one and hence dismissed the appeal of De Vera. o Since Gloria Villafania had already transferred ownership to Rosenda Tigno-Salazar and Rosita Cave-Go, the subsequent sale to De Vera was deemed void. Pursuant to a Motion for Reconsideration: CA issued an Amended Decision, finding De Vera to be a purchaser in good faith and for value. It further stated that she had relied in good faith on the Torrens title of her vendor and must thus be protected.

ISSUE: Who between the Spouses Abrigo and De Vera has a better right to the property? HELD: De Vera was in good faith, hence, she has a better right to the property. o When De Vera sought to purchase the land it was, and still is, registered in the name of Gloria Villafania. There is nothing in her certificate of title and in the circumstances of the transaction or sale which warrant De Vera in supposing that she needed to look beyond the title. o She had no notice of the earlier sale of the land to the Spouses Abrigo. She ascertained and verified that her vendor was the sole owner and in possession of the subject property by examining her vendors title in the Registry of Deeds and actually going to the premises. o She testified clearly and positively, without any contrary evidence presented by the Spouses Abrigo, that she did not know anything about the earlier sale and claim of the spouses Abrigo, until after she had bought the same, and only then when she bought the same, and only then when she brought an ejectment case with the Municipal Court of Mangaldan, Good-Faith Requirement Article 1544 requires the second buyer to acquire the immovable in good faith and to register it in good faith. Mere registration of title is not enough; good faith must concur with the registration. The rationale behind the above-mentioned statement is embodied in Uraca v. Court of Appeals: o The prior registration of the disputed property by the second buyer does not by itself confer ownership or a better right over the property.

Article 1544 requires that such registration must be coupled with good faith. Jurisprudence teaches us that (t)he governing principle is primus tempore, potior jure (first in time, stronger in right). o Knowledge gained by the first buyer of the second sale cannot defeat the first buyers rights except where the second buyer registers in good faith the second sale ahead of the first, as provided by the Civil Code. o Such knowledge of the first buyer does not bar her from availing of her rights under the law, among them, to register first her purchase as against the second buyer. o But in converso, knowledge gained by the second buyer of the first sale defeats his rights even if he is first to register the second sale, since such knowledge taints his prior registration with bad faith. Section 44 of PD 1529 in essence states that a person dealing with registered land is not required to go behind the registry to determine the condition of the property, since such condition is noted on the face of the register or certificate of title. Following this principle, this Court has consistently held as regards registered land that a purchaser in good faith acquires a good title as against all the transferees thereof whose rights are not recorded in the Registry of Deeds at the time of the sale.

Law on Double Sale The present case involves what in legal contemplation was a double sale. o Gloria Villafania first sold the disputed property to Rosenda Tigno-Salazar and Rosita Cave-Go, from whom petitioners, in turn, derived their right. Subsequently, a second sale was executed by Villafania with Respondent Romana de Vera. Article 1544 of the Civil Code states the law on double sale thus: o If the same thing should have been sold to different vendees, the ownership shall be transferred to the person who may have first taken possession thereof in good faith, if it should be movable property. o Should it be immovable property, the ownership shall belong to the person acquiring it who in good faith first recorded it in the Registry of Property. o Should there be no inscription, the ownership shall pertain to the person who in good faith was first in the possession; and, in the absence thereof, to the person who presents the oldest title, provided there is good faith. In summary the law provides that a double sale of immovables transfers ownership to: o The first registrant in good faith o The first possessor in good faith

Finally, the buyer who in good faith presents the oldest title There is no ambiguity in the application of this law with respect to lands registered under the Torrens system Both Spouses Abrigo and De Vera registered the sale of the property. Since neither petitioners nor their predecessors (Tigno-Salazar and Cave-Go) knew that the property was covered by the Torrens system, they registered their respective sales under Act 3344. For her part, De Vera registered the transaction under the Torrens system because, during the sale, Villafania had presented the TCT covering the property. Villafania had been issued a free patent registered as OCT. The OCT was later cancelled by a TCT, also in Villafanias name. As a consequence of the sale, the said TCT was subsequently cancelled, and a new TCT was issued to Dee Vera. In Soriano v. Heirs of Magali the Court held that: o Registration must be done in the proper registry in order to bind the land. Since the property in dispute in the present case was already registered under the Torrens system, the Spouses Abrigos registration of the sale under Act 3344 was not effective for purposes of Article 1544 of the Civil Code. In Radiowealth Finance Co. v. Palileo, the Court explained the difference in the rules of registration under Act 3344 and those under the Torrens system in this wise: o Under Act No. 3344, registration of instruments affecting unregistered lands is without prejudice to a third party with a better right. The aforequoted phrase has been held by this Court to mean that the mere registration of a sale in ones favor does not give him any right over the land if the vendor was not anymore the owner of the land having previously sold the same to somebody else even if the earlier sale was unrecorded.

DAGUPAN TRADING COMPANY vs. RUSTICO MACAM FACTS: Sammy Maron and his 7 brothers and sisters owned pro-indiviso, a parcel of unregistered land located in Barrio Parayao, Mun. of Binmaley, Pangasinan. While their application for registration was pending, they executed, 2 deeds of sale conveying the property to Rustico Macam, who thereafter took possession of it and proceeded to make substantial improvements therein. 1 month later, an OCT was issued covering the subject (sold) land, in the name of the Marons, free from all liens and encumbrances. By virtue of a final judgment rendered in a Civil Case in the Municipal Court of Manila, against Sammy Maron, and in favor of Manila Trading and Supply Company, a levy was made upon any interest he had in the aforementioned property, and thereafter said interest was sold at public auction to the creditor. The corresponding notice of levy, certificate of sale and the Sheriff's certificate of final sale in favor of the Manila Trading and Supply Co. because nobody exercised the right of redemptions were duly registered. Later on, the Manila Trading and Supply Co. sold all its rights and title to the property to Dagupan Trading Company. ISSUE: Who has the better right as between appellant Dagupan Trading Company, on the one hand, and appellee Rustico Macam, on the other, to the one-eighth share of Sammy Maron in the property mentioned heretofore? HELD: Rusto Macam has the better right. The sale in favor of Rustico Macam was executed before the land subjectmatter was registered, while the conficting sale in favor of Dagupan Trading Company was executed after the same property had been registered. What should determine the issue are the provisions of the last paragraph of Sec. 35, Rule 39, of the Rules of Court: o Upon the execution and delivery of the final certificate of sale in favor of the purchaser of land sold in an execution sale, such purchaser "shall be substituted to and acquire all the right, title, interest and claim of the judgment debtor to the property as of the time of the levy. Now We ask: What was the interest and claim of Sammy Maron on the oneeighth portion of the property inherited by him and his co-heirs, at the time of the levy?

He had none. For a considerable time prior to the levy, his interest had already been conveyed to Rustico Macam, "fully and retrievably as the Court of Appeals held. o Consequently, the subsequent levy made on the property for the purpose of satisfying the judgment rendered against Sammy Maron in favor of the Manila Trading Company was void and of no effect. o Needless to say, the unregistered sale and the consequent conveyance of title and ownership in favor of Rustic Macam could not have been cancelled and rendered of no effect upon the subsequent issuance of the Torrens title over the entire parcel of land. Court agrees with the following statement contained in the appealed decision: Separate and apart from this however, we believe that in the inevitable conflict between a right of ownership already fixed and established under the Civil Law and/or the Spanish Mortgage Law which cannot be affected by any subsequent levy or attachment or execution and a new law or system which would make possible the overthrowing of such ownership on admittedly artificial and technical grounds, the former must be upheld and applied. But to the above considerations must be added the important circumstance that, as already stated before, upon the execution of the deed of sale in his favor by Sammy Maron, appellee took possession of the land conveyed as owner thereof, and introduced considerable improvements thereon. To deprive him now of the same by sheer force of technicality would be against both justice and equity.

SIDE NOTE: (The Court said that these instances were not present in the case; I added this FYI lang) If the property covered by the conflicting sales were unregistered land, Macam would undoubtedly have the better right in view of the fact that his claim is based on a prior sale coupled with public, exclusive and continuous possession thereof as owner. On the other hand, were the land involved in the conflicting transactions duly registered land, We would be inclined to hold that appellant has the better right because, as We have consistently held, in case of conveyance of registered real estate, the registration of the deed of sale is the operative act that gives validity to the transfer. This would be fatal to appellee's claim, the deeds of sale executed in his favor by the Maron's not having been registered, while the levy in execution and the provisional certificate of sale as well as the final deed of sale in favor of appellant were registered. Consequently, this registered conveyance must prevail although posterior to the one executed in favor of appellee, and appellant must be deemed to have acquired such right, title and interest as appeared on the certificate of title issued in favor of Sammy Maron, subject to no lien, encumbrance or burden not noted thereon.