DURAN v. INTERMEDIATE APPELLATE COURTG.R. No.

L-64159
September 10, 1985Relova, J.
Doctrine:- The fraudulent and forged document of sale may become the root
of a valid title if the certificate has already been transferred from the name of
the true owner to the name indicated by the forger.
- The mortgagee has the right to rely on what appears in the certificate of title
and, in the absence of anything to excite suspicion, he is under no obligation
to look beyond the certificate and investigate the title of the mortgagor
appearing on the face of the said certificate.
- Good faith, while it is always to be presumed in the absence of proof to the
contrary, requires a well-founded belief that the person from whom title was
received was himself the owner of the land, with the right to convey it.
Facts:Petitioner Duran owned 2 parcels of land. She left the Philippines in
June 1954 and returned in May 1966. On 1963, a Deed of Sale was made in
favor of the petitioners mother. On December 1965, Durans mother
mortgaged the same property to private respondent Erlinda Marcelo-Tiangco.
When Duran came to know about the mortgage made by her mother, she
wrote the Register of Deeds informing the latter that she had not given her
mother any authority to sell or mortgage any of her properties in the
Philippines. Meanwhile, foreclosure proceedings were initiated by Tiangco
upon the failure of Durans mother to redeem the mortgaged properties.
Duran claims that the Deed of Sale is a forgery, saying that at the time of its
execution in 1963 she was in the United States. Respondent Court ruled that
there is a presumption of regularity in the case of a public document.

Issue:Whether private respondent was a buyer in good faith and for value
Held:Yes. Good faith consists in the possessors belief that the person from
who he received the thing was the owner of the same and could convey his
title (Arriola v. Gomez Dela Serna, 14 Phil. 627). Good faith, while it is always
to be presumed in the absence of proof to the contrary, requires a wellfounded belief that the person from whom title was received was himself the
owner of the land, with the right to convey it (Santiago v. Cruz, 19 Phil. 148).
The mortgagee has the right to rely on what appears in the certificate of title
and, in the absence of anything to excite suspicion, he is under no obligation
to look beyond the certificate and investigate the title of the mortgagor
appearing on the face of the said certificate. Every person dealing with
registered land may safely rely on the correctness of the certificate of title
issued therefore and the law will in no way oblige him to go behind the
certificate to determine the condition of the property. If the rule were
otherwise, the efficacy and conclusiveness of the Torrens Certificate of Titles
would be futile and nugatory. Thus the rule is simple: the fraudulent and
forged document of sale may become the root of a valid title if the certificate
has already been transferred from the name of the true owner to the name
indicated by the forger.
While it is true that under Article 2085 of the Civil Code, it is essential that the
mortgagor be the absolute owner of the property mortgaged, and while as
between the daughter and her mother, it was the daughter who still owns the
lots, STILL insofar as innocent third persons are concerned the owner was
already the mother inasmuch as she had already become the registered
owner.