Republic of the Philippines

REGIONAL TRIAL COURT

5th Judicial Region
Branch 60, Iriga City
PATRIA PALENZUELA, MAIDEN B. ZABATE,
LUNINGNING GUNNEFENT,
Plaintiffs,
-versus-

CIVIL CASE NO. IR-3684

For: Reconveyance, Annulment
SANTOS RANCES, JR. and MARILYN
of Sale, Specific Performance &
D. RANCES, HEIRS OF PEDRO DIMAIWAT,Damages
rep. by his widow LUCIA CAPILI VDA. DE
DIMAIWAT, the HON. REGISTER OF DEEDS
OF IRIGA CITY, the HON. ASSESSOR OF
IRIGA CITY and HON. DENR OFFICER OF
IRIGA CITY
Defendants.
x--------------------------------------------------------x
DECISION
The case is between and among neighbours involving the portion of
agricultural land covered by Tax Declaration No. 22-2412 in the name of
Dionesia Dimaiwat with an area of 400 square meters located at San Nicolas,
Iriga City. Plaintiffs seek to have the Deed of Absolute Sale over the property
between Spouses Pedro Dimaiwat and Lucia Capili and Spouses Santos
Rances Jr. and Marilyn D. Rances declared null and void. They also want the
defendants DENR Officer of Iriga City and Register of Deeds of Iriga City to
annul Katibayan ng Original na Titulo Blg 2322 and that a new title be issued
in their favour being the legitimate heirs of Dra. Antonia A. Ramirez. They
also would like the defendant City Assessor of Iriga City to cancel/annul ARP
No. 022-3239 with PIN No. 136-04-022-05-139 in the name of defendants
Santos Rances Jr. and a new ARP be issued in favour of the plaintiffs. They
also want the court to order the defendants Santos Rances Jr. and Marilyn D.
Rances and Lucia Capili to pay damages.
Answering defendants, Spouses Santos Rances Jr. and Marilyn D.
Rances and the Heirs of Pedro Dimaiwat represented by Lucia Capili Vda. de
Dimaiwat deny the genuineness and due execution of the Deed of Absolute
Sale between Spouses Pedro Dimaiwat and Lucia Capili Vda. de Dimaiwat on
the one hand, and Antonia Ramirez on the other, there being no indubitable
evidence as to the truth and veracity thereof. They claim that the notary
public who purportedly notarized the said deed of sale did not submit his
report nor the notarial register to the Clerk of Court of the RTC of Iriga City.
Moreover, they take issue on the fact of the notary public being a nonlawyer. They however admit that the subject property is adjacent to the lot
owned by Sps. Pedro Dimaiwat and Lucia Capili but deny the transaction
between Pedro Dimaiwat and Antonia Ramirez even prior to the sale of
Dionisia Dimaiwat to Pedro Dimaiwat. They submit that since that notarial of

the notary public was not submitted, the sale by Dionesia Dimaiwat of the
400 square meter lot on July 28, 1980 is not a basis for plaintiffs claim.
They attack the sale as unenforceable considering that the agreement was
merely handwritten by Pedro Dimaiwat and does not mention of any sale of
a piece of land. Defendants admit Deed of Absolute Sale executed by Sps.
Pedro and Lucia Dimaiwat in their (defendants) favour dated September 6,
1980 by which defendants Rances were able to obtain Katibayan ng Orihinal
na Titulo Blg. 2322. They contend that the sale to them (defendant Rances)
was properly supported with valid and legal documents. In contrast they
assail the sale between Pedro Dimaiwat and Antonia Ramirez on August 17,
1981 as one that happened long after the sale to the defendants Sps.
Rances. They claim further that there was no perfected contract based on
the handwritten note. To them, the handwritten note is not allowed under
the Statute of Frauds. They further deny that Dionisia Dimaiwat executed
typewritten receipt for P1,000.00 for the sale of the land on July 26, 1980.
Moreover, the alleged sale was not in legal form hence not valid and
enforceable. Finally, they claim that there was no bad faith borne of prior
knowledge on the part of the defendant about the sale in 1981.
Defendants Rances submit that they lawfully obtained Katibayan ng
Orihinal na Titulo Blg. 2322 through a valid Deed of Sale duly notarized and
registered in the notarial register of Atty. Demetrio O. Morana. They were
allegedly the first buyers of the land and there being no prior registration of
the alleged sale between Pedro Dimaiwat and Antonia Ramirez which, even if
true, happened later. They should be considered buyers in good faith.
Besides registration, they declared the land in their names for taxation
purposes. According to them, the subject property was used by the
neighbours as passageway to and from the highway, by tolerance of the
owners the defendants. Defendants also deny that the plaintiffs were in
actual and physical possession of the property since 1981 up to the present.
Defendants were only prevented in 2005 by plaintiff Palenzuela to make use
of the property when the defendants started construction of the defendants
house thereon, claiming to have inherited the same from her mother
(Antonia Ramirez). Subsequently, plaintiff Palenzuela allegedly, constructed a
poultry house. Defendant Rances deny being aware of the alleged sale of the
land to Antonia Ramirez. They purchased the property only on September 6,
1980 and not on August 17, 1980. They claim to be the ones entitled to
damages.
Defendant Community Environment and Natural Resources Officer
affirmed that KOT Blg. 2322 was issued on July 24, 2003 by PENRO
Esmeraldo C. Luna. The Deed of Absolute Sale executed on September 1980
by Mr. Pedro Dimaiwat and his wife Lucia Capili in favour of Santos Rances,
Jr. was submitted to his office as supporting to Santos Rances Jr.s Free
Patent Application. According to him, Lot 3150-A under Cad-014753-D is
equivalent to Lot 24055, Cad. 370, Iriga Cadastre covered by Patent No.
051716-03-07085.
Plaintiffs filed their reply to defendant answer.

The pre-trial order contains the issue submitted by the plaintiffs to be

resolved:
1. Whether or not the Deed of Absolute Sale of Real Property in
question between defendants spouses Pedro Dimaiwat
(deceased), Lucia Capili and defendants spouses Santos
Rances Jr. and Marilyn D. Rances which Exhibit I for the
plaintiffs should be annulled.
2. Whether or not Katibayan ng Orihinal na Titulo Blg. 2322
issued in favour of defendants spouses Santos Rances Jr. and
Marilyn Rances should be nullified.
3. Whether or not defendant spouses Rances Jr. and the heirs of
Pedro Dimaiwat as represented by his widow Lucia Capili
should be held jointly and severally for damages in favour of
the plaintiffs.
4. Whether the defendant should be ordered to execute a
document for the confirmation of plaintiffs vested real rights.
Defendants on the other hand wants the court to resolve the following
issues:
1. What is the binding effect of the Deed of Absolute Sale of Real
Property between Pedro Dimaiwat and Lucia Capili on the one
hand and defendants Santos Rances and Marilyn Rances.
2. What is the binding effect of KOT in favour of Santos Rances
Jr. and Marilyn Rances.
3. Are defendants spouses Rances entitled to the ejectment and
demolition of the structure of the plaintiffs from the area
owned by the defendants under the KOT, at the expenses of
plaintiffs?
During trial, plaintiff Patria Palenzuela submitted her judicial affidavit
on which she was duly cross-examined by the adverse counsel. Defendants
presented Marilyn Dimaiwat-Rances and Shirley A. Dimaiwat.
From the testimony of the Patria Palenzuela, the court gathers that
aside from her being the plaintiff, she also represents as co-plaintiffs her
siblings Maiden Balmonte-Zabate and Luningning Balmonte-Gunnefelt in the
instant case. Their mother died already as shown be the death certificate
under registry no. 2004-838. Defendants spouses Santos and Marilyn as well
as Lucia Capili Vda. De Dimaiwat are her neighbours since the middle part of
1970s. She impleaded the Registry of Deeds, City Assessors and the City
Environment and Natural Resources Office as nominal parties and as official
custodian of documents pertaining to this case.
The property is originally owned by Dionesia Dimaiwat as shown by TD
and FAAS (Exh. I-3 and I-4).

In the course of Patria Palenzuelas testimony, she presented the Deed

of Absolute Sale (Exh. D) executed by spouses Pedro Dimaiwat and
Defendant Lucia Capili in favour of her mother Dra. Antonia Alfelor Ramirez.
Tha sale was on August 17, 1981 for P1,500.00 over the approximately 400
square meters portion of land. According to her, the subject property is just
at the back of their house. She also presented the Deed of Absolute Sale
executed by Dionesia Dimaiwat in favour of Pedro Dimaiwat and Lucia Capili
on July 28, 1980, the property was already transacted by Pedro Dimaiwat to
Dra. Antonia Alfelor Ramirez. As proof she presented two (2) letters (Exhs. F
and G) of Pedro Dimaiwat addressed to the mother of the witness. Exh. F is
the letter/receipt (Exh. F-1) dated July 28, 1980 for P1,000.00 signed by
Dionesia Dimaiwat. This document was left to her by her mother before
death. Patria Palenzuela was present when her mother gave P1,000.00 to
Pedro Dimaiwat who in turn gave the money to Dionesia Dimaiwat, Pedros
auntie and original owner of the property. She knew this for a fact because
her family and her mother were living in the same house in San Nicolas,
Iriga City and the payment was made in her presence. Pedro was asking that
the money be deducted in the total consideration of the property. The
mommy referred to in the letter is Dra. Ramires, the mother of the
witness, but Pedro Dimaiwat calls Dionesia mommy, the latter being older
and a long time neighbour. When Patria Palenzuela applied for building
permit to construct her house, she discovered that the subject property
stated in Exh. D was already titled in the name of defendants Santos Rances
Jr., married to Marilyn D. Rances. As proof thereof, she obtained a certified
Xerox copy (Exh. D) of KOT Blg. 2322. She was also able to obtain a copy of
Deed of Sale (Exh. I) executed by Pedro Dimaiwat and wife Lucia Capili in
favour of the defendants Rances. Patria Palenzuela knows that Pedro
Dimaiwat was referring to the same property subject of Exhs. D, E and I
because the property being referred to is of the same description and the
property was only at the back of their residence. From August 17, 1981 at
the time Exh. D was executed by Pedro Dimaiwat and Lucia Capili in favour
of her mother, Patria Palenzuela and her family were the ones in possession
of the subject property. From September 6, 1980 at the time the deed of
absolute sale was executed by Pedro Dimaiwat and Lucia Capili in favour of
the spouses Rances and up to the present, the spouses never took
possession of the property.
After her discovery of the irregularities, Patria Palenzuela lodged a
complaint with the Office of the Barangay Chairman of San Nicolas, Iriga City
against Lucia Capili and Marilyn Dimaiwat-Rances on December 2002.
Defedant Lucia Capili Vda. De Dimaiwat and defendants Rances refused to
appear. Later she discovered at the DENR that defendants Rances were
already able to obtain a title.
Dra. Ramirez had a doctoral degree in education and served as
Division Supervisor for Social Studies in Camarines Sur and Assistant Dean
of the Graduate Studies at the University of Notheastern Philippines (UNEP).
When Dra. Ramirez was ill, defendant Rances even served as registered
nurse to her mother. With the permission of her two (2) siblings, she
instituted this case. She paid her lawyer P50,000.00 and P3,000.00 per

appearance. As moral damages,

P50,000.00 as exemplary damages.

she

is

asking for

P50,000.00

and

Defendant Marilyn Dimaiwat-Rances that she is the daughter of Pedro

Dimaiwat and Lucia Capili. Santos Rances is her husband. She denies the
genuineness and due execution of the alleged sale by Pedro Dimaiwat and
Lucia Capili of the 400 square meter lot subject of this case to the late
Antonia Ramirez on August 17, 1981. As proof she presented the
certification (Exh. 1) issued by the IBP showing that the Notary Public who
notarized the deed of sale was not a member of the Philippine Bar. She also
presented the Certification (Exh. 2) by the Office of the Clerk of Court of
Iriga City that Jose Vicente Cruz was then commissioned to notarize but did
not submit his notarial registry during the years 1978-1980, 1980 to 1982
and 1983-1984.
Marilyn and her husband acquired the property which is Lot 3510-A
from her father Pedro Dimaiwat on September 6, 1980. She identified the
Deed of Absolute Sale dated September 6, 1980 (Exh. 9). It was first
registered on September 6, 1980 in the Notarial Register of Atty. Demetrio
O. Morana as Doc. No. 180, Page No. 86, Book No. 73, Series of 1980. She
paid the taxes on this property and the tax declaration are marked as
Exhibits 10 to 10-N. The Office of the City Treasurer of the City of Iriga
issued Real Property Tax Clearances from 1974 to 2013. She claims that a
handwritten note (Exh. F), although dated July 28, 1980 was not a contract
of sale between Antonia A. Ramirez (Mother of Plaintiff Patria Palenzuela)
and Pedro DImaiwat. It was only later they were informed about the
document dated August 30, 1981 which purports to be a contract of sale
between Pedro Dimaiwat and Antonia Ramirez, mother of the plaintiffs. It
was dated August 30, 1981 and notarized by Mr. Jose Vicente B. Cruz (Exh.
D) under Document No. 1055, Page No. 250, Book No. 1, Series of 1981 but
was not filed with the Office of the Clerk of Court of Iriga City per
certification of Atty. Rina B. Orbon, OIC, OCC. The deed of sale was not also
registered with the Register of Deeds or the Assessors Office because the
land is already registered in their (defendants) names in September 6,
1980. As certified to by the Office of the City Assessor of Iriga City, there is
no real property declared in the name of Patria Palenzuela or even in the
name of her mother. The Registry of Deeds of Iriga City also issued a
certification on February 9, 2007 that the office did not have any property
titled in the name of Patria Palenzuela covering a parcel of land in San
Nicolas, Iriga City with an area of 400 sq. m. and designated as Lot No.
3510-A. the plaintiffs went to the barangay authorities insisting on their
claim. Defendant Marilyn rances claims that because the Department of
Public Works and Highways widened the road in the area, the property in the
name of the plaintiff was reduced to 130 sq.m. and plaintiffs were insisting
that they (defendants), as neighbours, should cover them for their loss, i.e.
getting the equivalent area lost to the government from the portion of the
property. Marilyn declined and told the plaintiff to go after the government
for payment.
To prove her superior right over the property, she presented the
Certification 2013-056 issued by CENRO dated February 12, 2013 that Lot

3510-A with an area of 400 sq.ms located in San Nicolas, Iriga City is
covered with Free Patent Agreement No. 051716-03-17085 issued on July
24, 2003 in the name of Santos Rances, Jr. by virtue of FPA No. 0517602442. Patria Palenzuela has no Free Patent agreement in her favour.
In the course of Marilyns testimony, she presented the original survey
of the land (Exh. 3) and the original Deed of Sale dated September 6, 1980.
She caused the transfer of the tax declaration to her name before the
Assessors Office and the Treasurers Office of Iriga City. She did this when
she applied for titling in 2003. She was not able to have tax declaration
immediately transferred and the land titled to her name because at the time
she bought the property from her father in 1980, she was then living in
Manila working as a company nurse. In 1985, she started working abroad
and she seldom had a longer vacation to have the transfer and title
processed. She presented the Tax Declarations (Exh. 6, 7, and 8). When she
bought the land, it was hilly and grassy. In 2005, she asked her mother to
make an extension of their ancestral house in the remaining portion. They
were not able to finish the extension because her parents were prevented by
plaintiffs. Prior to this and even before the purchase, she knows nothing
about any claim of the plaintiffs who were even aware of the survey that she
caused when she applied for a free patent with the DENR sometime in 2003.
As proof she presented the certification issued by the barangay that the
plaintiffs did not have any complaint against spouses Rances in 2005. What
was filed by the plaintiff was a complaint regarding the boundary dispute
against her mother, Lucia Capili-Dimaiwat. Her application for Free Patent
was approved in 2003 and the title (Exh. 4). She only learned that she was
sued as defendant sometime in September 2005 when she received the
summons from RTC Br. 34. It was dismissed but re-filed. She was shocked
upon receipt of the summons in the instant case, bringing her sleepless
nights so she engaged the service of a legal counsel. As moral damages, she
leaves the same to the Court. For attorneys fees, she is asking P50,000.00
as acceptance fee and P2,000.00 per appearance fee. As litigation expenses
she asking for P25,000.00 As Exemplary damages, she asking for
P500,000.00.
Marichu Dimaiwat-Tuazon testified that Marilyn Rances, one of the
defendants, is her eldest sister. Plaintiff Patria Palenzuela is their neighbour
for 37 years until the present. The subject property is located just at the
back of their house, the old house of Pedro Dimaiwat in San Nicolas, Iriga
City. The subject land is owned by their father Pedro Dimaiwat but the same
is now owned by spouses Marilyn and Santos Rances. When her father
started to renovate the house, her father asked permission from the spouses
Marilyn and Santos Rances in 1980 to use a portion of the lot. The
permission was necessary because at the time, the land was owned by
Marilyn. She identified her signature in the deed of Sale executed by Pedro
Dimaiwat and Lucia Capili in favour of Santos Rances and Marilyn Rances
(Exh. 9). When her father asked Marilyn and Santos for permission to use
part of the land, Mrs. Ramirez was there just looking at/watching the
levelling of the land until it was finished. Mrs. Ramirez did not stop or object
to the levelling. Pedro Dimaiwat was only able to finish the renovation of the
main house but not the dirty kitchen. It was her father who was holding the

budget during the renovation of their ancestral house. At the time of

renovation, the children of defendants-spouses Santos Rances were living
with the witness in San Nicolas, Iriga City while defendants-spouses were
working in Manila. Seldom did the spouses Rances went back to the
ancestral house. As of now, the present occupant of the ancestral house is
the whole Dimaiwat family including witness. Pedro Dimaiwat died on July
27, 1995 while Mrs. Antonia Ramirez died in 2004.
Pedro Dimaiwat came to own the subject land because it was his
inheritance from Gregorio Dimaiwat and Esperanza. Gregorio Dimaiwat is the
father of Dionisia Dimaiwat and Esperanza Encarnacion Lopez is the wife of
Gregorio. As acts of ownership, Pedro Dimaiwat used to go to the subject
land and planted trees after his retirement.
Shirley A. Dimaiwat testified that Marilyn D. Rances is her first cousin,
being the daughter of her fathers brother. Pedro Dimaiwat is the brother of
her late father, Juanito Dimaiwat. Lucia Capili is the wife of Pedro Dimaiwat.
Santos Rances is the husband of Marilyn D. Rances. Patria Palenzuela was
their neighbour since Patria lived at the corner lot next to their house. She
came to learn about plaintiffs claim over the land on January 8, 2003 when
she was at the house of her aunt Lucia Dimaiwat in San Nicolas. Lucia then
just came from the barangay hall where a confrontation transpired between
her and Patria Palenzuela. The two earlier argued over the fact that Patria
Palenzuela was illegally intruding into the Dimaiwat Property which Marilyn
bought from her husband.
Before the case was submitted for decision, the parties were given the
opportunity to submit respective memorandum to amplify their respective
positions. Only the plaintiff filed their requirement.
DISCUSSION
Before proceeding with the discussion, a simple timeline would help
understand the facts easier:
July 26, 1980

Date of receipt signed by Dionisia

Dimaiwat
with
the
P1,000.00
consideration;

July 28, 1980

Deed of Absolute Sale of Dionisia

Dimaiwat to Pedro Dimaiwat; Notarized by Jose
Cruz;
- Date of Mommy letter;

September 6, 1980

Deed of Absolute Sale of Real

Property executed by Pedro Dimaiwat in
favour of Santos Rances / Marilyn Rances.
Notarized by Atty. Demetrio O. Morana;

August 17, 1981

Date of Deed of Absolute Sale of

Pedro Dimaiwat and Lucia Capili in favour

of Dra. Antonia A. Ramirez; The document

is notarized by Jose Cruz;
July 27, 1995

Pedro Dimaiwat died;

January 7, 2003

Plaintiff
Patria
Palenzuela
filed
a
complaint with the Punong Barangay of San
Nicolas, Iriga City regarding the alleged
boundary dispute over some 145 square
meters of property;

July 24, 2003

Katibayan ng Orihinal na Titulo Blg. 2322

of Santos Rances / Marilyn Rances was issued;

June 20, 2004

Antonia Ramirez died.

That the lot involved here was sold (Exh. E) bu Dionesia Dimaiwat to
Pedro Dimaiwat and Lucia Capili on July 28, 1980 is undisputed. The bone
of contention, however, is whether the Deed of Absolute Sale (Exh. D)
executed by spouses Pedro Dimaiwat and defendant Lucia Capili in favour of
Dra. Antonia Alfelor Ramirez on August 17, 1981 for P1,500.00 over the
approximately 400 square meters portion which is now the subject land (Lot
3510-A) is valid and should be the one upheld over the Deed of Sale (Exh.
9) executed by Pedro Dimaiwat in favour of Marilyn D. Rances on
September 6, 1980.
Plaintiffs claim that even before the execution by Dionesia Dimaiwat in
favour of Pedro Dimaiwat of the Deed of Absolute Sale (Exh. E) on July 28,
1980, the property was already transacted and sold by Pedro Dimaiwat to
Dra. Antonia Alfelor Ramirez. To prove this, plaintiffs presented two (2)
letters (Exhs. F and G) of Pedro Dimaiwat addressed to the mother of the
witness. Exh. F is the receipt (Exh. F-1) dated July 28, 1980 for P1,000.00
signed by Dionesia Dimaiwat.
The controversy is clearly a case of double sale, the first to be
notarized being the sale by Pedro Dimaiwat in favour of spouses Santos
Rances and Marilyn Dimaiwat Rances on September 6, 1980 and the second
being the sale of the same subject of lot by Pedro Dimaiwat and Lucia Capili
in favour of Dra. Antonia Ramirez on August 17, 1981.
The sale to the defendants is being contested by the plaintiffs on
mainly on the technical aspect of the notarization and not on account of any
forgery or falsification of the document. They follow this with their argument
that they were buyers for value and registration in good faith. Defendants on
the other hand claims that the first notarized deed of sale to their favour and
the certificate of title flowing therefrom should be declared valid, they being
purchasers of value and good faith.
Along double sales, the Supreme Court consistently held:
Article 1544 of the Civil Code provides:

ART. 1544. If the same thing should have been sold to different
vendees, the ownership shall be transferred to the person who
may have first possession thereof in good faith, if it should be
movable property.
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.
x x x, (Alejandro Gabriel and Alfredo Gabriel vs. Sps. Pablo
Mabanta and Escolastica Colobong, et al., G.R. No. 142403,
March 26, 2003)
As explained by the Supreme Court:
Otherwise stated, where it is an immovable property that
is the subject of a double sale, ownership shall be transferred
(1) to the person acquiring it who in good faith first recorded it
in the Registry of Property; (2) in default thereof, to the person,
who in good faith was first in possession; and (3) in default
thereof, to the person who presents the oldest title, provided
there is good faith. The requirement of the law is two-fold:
Acquisition in good faith and registration in good faith. The
rationale behind this is well-expounded in Uroca vs. Court of
Appeals, where this Court held:
Under the foregoing, 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). Knowledge gained by
the first buyer of the second sale cannot defeat the first buyers
right except where the second buyer registers in good faith the
second sale ahead of the first, as provided by the Civil Code.
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 against the second buyer. But in converso, knowledge
gained by the second buyer of the first sale defeats his right
even if he is first to register the second sale, since such
knowledge taints his prior registration with bad faith. This is the
price exacted by Article 1544 of the Civil Code for the second
buyer being able to displace the first buyer, that before the
second buyer can obtain priority over the first sale and of the
first buyers right) from the time of acquisition until the title is
transferred to him by registration or failing registration by
delivery of possession. (Emphasis supplied)
We have consistently held that in cases of double sale of
immovables, what finds relevance and materiality is not whether
or not the second buyer was a buyer in good faith but whether

or not said second buyer registers such second sale in good

faith, that is, without knowledge of any defect in the title of the
property sold. In Salvoro vs. Tanega, we had the occasion to
rule that:
If a vendee in a double sale registers the sale after he has
acquired knowledge that there was a previous sale of the same
property to third party or that another person claims said
property in a previous sale, the registration will constitute a
registration in bad faith and will confer upon him in any right.
Mere registration of title is not enough, good faith must concur
with the registration. To be entitled to priority, the second
purchaser must not only establish prior recording of his deed,
but must have acted in good faith, without knowledge of the
existence of another alienation by the vendor to the other. In
the old case of Leung Yee vs. F. L. Strong Machinery Co. and
Williamson this Court ruled:
One who purchase a real estate with knowledge of a
defect of title in his vendor cannot claim that he has acquired
title thereto in good faith as against the true owner of the land
or of an interest therein; and the same rule must be applied to
one who has knowledge of facts which should have put him upon
such inquiry and investigation as might be necessary to acquaint
him with the defects in the title of his vendor. A purchaser
cannot close his eyes to facts which should put a reasonable
man upon his guard, and then claim that he acted in good faith
under the behalf that there was no defect in the title of the
vendor. His mere refusal to believe that such a defect exists, or
his wilful closing of his eyes to the possibility of the existence of
a defect in his vendors title will not make him an innocent
purchaser for value, if it afterwards develops that the little was
in fact defective, and it appears that he had such notice of the
defect as would have led to its discovery had he acted with that
measure of precaution which may reasonably be required of a
prudent man in a like situation. x x x
x x x.
The principle of primus tempore, potior jure (first in time,
stronger in right) gains greater significance in case of a double
sale of immovable property. When the thing sold twice is an
immovable, the one who acquires it and first records it in the
Registry of Property, both made in good faith, shall be deemed
the owner. Verily, the act of registration must be coupled with
good faith that is the registrant must have knowledge of the
defect of lack of title of his vendor or must not have been aware
of facts which should have put him upon such inquiry and
investigation as might be necessary to acquaint him with the

defects in the title of his vendor.) (Emphasis and underlining

supplied) (Id.)
In the case at bar, defendants Rances, the ones holding the earlier
notarized deed of sale, were also the first and the only ones to have the sale
to them recorded in the Registry of Property. They were in fact able to obtain
a Free Patent. As to whom the property should belong, the pivotal question
therefore is: As the bearers of the earlier notarized deeds of sale and sole
registrants, were the defendants purchasers in good faith and were they in
good faith in their registration of the sale to them?
In trying to prosecute their case, plaintiffs tried to show that they were
in fact the first buyer and if ever it was the defendants who had earlier
notarized deed of sale and who first had the sale registered in their names,
the acquisition as well as the registration was not in good faith. Plaintiffs
pray that the property be reconveyed to them and the title as well as the
deed of sale of Pedro Dimaiwat in favour of the spouses Rances be nullified.
In proving that they were the first buyers, plaintiffs further presented the
receipt (Exh. G) as well as the letters (Exh. F and F-1) purporting to support
their contention that the earlier sale to their mother was perfected even long
before Pedro Dimaiwat executed the sale to the defendants spouses Rances.
This court has to sustain plaintiffs position.
The receipt (Exh. G) as well as the letters (Exh. F and F-1) may be
private instruments. Thus, however, does not negate the sale between Pedro
Dimaiwat and Antonia Ramirez on July 26, 1980 or more than a month
before the sale to the defendants Rances. On the matter of sales, it is settled
that:
Three elements are needed to create a perfected contract:
1) the consent of the contracting parties; 2) an object certain
which is the subject matter of the contract; and 3) the course of
the obligation which is established. Under the law on sales, a
contract of sale is perfected when the seller, obligates himself,
for a price certain, to deliver and to transfer ownership of a thing
or right to the buyer, over which the latter agrees. From that
moment, the parties may demand reciprocal performance.
(Starbright Sales Enterprises, Inc. vs. Philippipne Realty
Corp., et al., G.R. No. 177936, January 18, 2012)
Along the issue of validity of sales, the Supreme Court ruled:
Assuming authenticity of his signature and the
genuineness of the document, Dalion nonetheless still impugns
the validity of the sale on the ground that the same is embodied
in a private document, and did not thus convey title or right to
the lot in question since acts and contracts which have for their
object the creation, transmission, modification or extinction of
real rights over immovable property must appear in a public
instrument (Art. 1358, par. 1, NCC).

This argument is misplaced. The provision of Art. 1358 on

the necessity of public document is only for convenience not for
validity or enforceability. It is not a requirement for the validity
of a contract of sale of a parcel of land that this be embodied in
a public instrument.
A contract of sale is a consensual contract, which means
that the sale is perfected by mere consent. No particular form is
required for its validity. Upon perfection of the contract, the
parties may reciprocally demand performance (Art. 1475, NCC),
i.e.., the vendee may compel transfer of ownership of the object
of the sale, and the vendor may require the vendee to pay the
thing sold. (Art. 1458, NCC).
The trial court thus rightly and legally ordered Dalion to
deliver to Sabesaje the parcel of land and to execute
corresponding formal deed of conveyance in a public document.
Under Art. 1498, NCC, when the sale is made through public
instrument, the execution thereof is equivalent to the delivery of
the thing. Delivery may either be actual (real) or constructive.
Thus delivery of a parcel of land may be done by placing the
vendee in control and possession of the land (real) or by
embodying the sale in a public instrument (constructive).
(Spouses Dalion vs. CA, et al., G.R. No. 78903 February
28, 1990)
The sale as evidenced by the two (2) letters and subsequent receipt is valid
and enforceable. While it is likewise true that the receipt and the letters may
not have specified from whom the consideration was received and the
subject land thereof was not stated, the details of the sale transaction
between Pedro Dimaiwat and Dra. Antonia Ramirez as early as July 26, 1980
was clearly and satisfactorily established by the testimony of plaintiff Patria
Palenzuela and her witness.
In short, since the sale between Pedro Dimaiwat and Dra. Antonia
Ramirez on July 26, 1980 was already perfected and consummated, the
former could no longer dispose of something that he no longer own when he
later sold the same land to her daughter Marilyn Dimaiwat Rances and sonin-law Santos Rances more than a month after or on September 6, 1980.
While it is true that what is at issue in double sales is the good faith or
bad faith of the defendants in acquiring and registering the property, and not
the good faith or bad faith of anybody else, the case at bar takes the
exception.
In the instant case, defendant Marilyn Dimaiwat is herself the daughter
Pedro Dimaiwat. The latter was the one who sold the property twice, frist
actually to his neighbour Dra. Antonia Ramirez and second to his own
daughter Marilyn and son-in-law, now the real defendants in the instant
case.

Considering the latters previous sale to Dra. Antonia Martinez, his

paternity alone highlights his dishonest disposition to convey the subject
property to his direct descendant to the prejudice of the person to whom he
and his aunt, Dionisia Dimaiwat, transacted and sold the property more than
a month earlier.
Moreover, Pedro Dimaiwat and Dra. Ramirez are immediate
neighbours. It is unconceivable how his family, especially his own daughter
defendant Marilyn Dimaiwat, would not know the sale to Antonia Ramirez,
unless he withheld the earlier sale to his daughter. It is contrary to human
experience for Pedro Dimaiwat not to discuss the sale to his family especially
that it is a disposition of property just beside their residence. The
withholding of that information to Marilyn Rances however is in itself as
illogical as it is pregnant with selfish and unjust motivations on the part of
Pedro Dimaiwat.
it is also noted that as early as January 7, 2003, plaintiff Patria
Palenzuela filed a complaint with the Punong Barangay of San Nicolas, Iriga
City regarding the alleged boundary dispute over some 145 square meters of
property. This fact is already notice enough of the defect in Marilyns title
considering the earlier sale by his father to Antonia Martinez. Even assuming
that she was not aware of the earlier sale to Antonia Martinez, the
confrontation at the barangay would have already apprised her of the
dispute over the land, be it a simple boundary row. As the facts would show,
defendants went on to obtain Katibayan ng Original na Titulo Blg. 2322 on
July 24, 2003 or more than six (6) months after the complaint was lodged
before the office of the Punong Barangay. Evidently, she knows the defect in
her title and bad faith on her and her spouses part is latent.
As to what bad faith is, the Court explained:
Now respondent Reyes claims that she is a purchaser in
good faith. This is preposterous. Good faith is something
internal. Actually, it is a question of intention. In ascertaining
ones intention, this Court must rely on the evidence of ones
conduct and outward acts. From her actuations as specified
above, respondent Reyes cannot be considered to be in a good
faith when she bought the lot.
Moreover, it bears noting that on September 16, 1985,
both petitioners filed with trial court their complaint involving the
lot in question against respondents. After a month, or on
October 17, 1985, respondent Reyes had the Deed of Absolute
Sale registered with the Registry of Property. Evidently, she
wanted to be the first one to effect its registration to the
prejudice of petitioners who, although in possession, have not
registered the same. This is another indicum of bad faith.
We have consistently held that in cases of double sale of
immovables, what finds relevance and materiality is not

whether or not the second buyer was a buyer in good faith but
whether or not said second buyer registers such second sale in
good faith, that is, without knowledge of any defect in the title of
the property sold. In Salvoro vs. Tanega we had the occasion to
rule that:
If a vendee in a double sale registers the sale after he has
acquired knowledge that there was a previous sale of the same
property to a third party or that another person claims said
property in a previous sale, the registration will constitute a
registration in bad faith and will not confer upon him any right.
Mere registration of title is not enough, good faith must
concur with the registration. To be entitled to priority, the
second purchaser must not only established prior recording of
his deed, but must have acted in good faith, without knowledge
of the existence of another alienation by the vendor to the other.
In the old case of Leung Yee vs. F. L. Strong Machinery, Co. and
Williamson, this Court ruled:
One who purchases a real estate with knowledge of a
defect of title in his vendor cannot claim that he has acquired
title thereto in good faith as against the true owner of the land
or of an interest therein; and the same rule must be applied to
one who has knowledge of facts which should have put him upon
such inquiry and investigation as might be necessary to acquittal
him with the defects in the title of his vendor. A purchaser
cannot close his eyes to facts which should put a reasonable
man upon his guard, and then claim that he acted in good faith
under the belief that there was no defect exists, or his wilful
closing of his eyes to the possibility of the existence of a defect
in his vendors title will not make him an innocent purchaser for
value, if it afterwards develops that the title was in fact
defective, and it appears that he had such notice of the defect as
would have led to its discovery had he acted with that measure
of precaution which may reasonably be required of a prudent
man in a like situation. x x x
In fine, we hold that respondent Zenaida Tan-Reyes did
not act in good faith when she bought the lot and had the sale
registered. (Gabriel vs. Spouses Mabanta, et al., G.R. No.
142403, March 26, 2003)
Defendants contend that the inaction on the part of the plaintiff during
the renovation initiated by Pedro Dimaiwat on the ancestral house should be
interpreted as acquiescence to the works done and thus recognition of the
ownership of their ownership. This is not entirely persuasive. First, there is
no written proof of the permission granted by the spouses Rances. Second, it
is self-serving for the father who was the vendor, and self-serving to for the
defendant-daughter, to be asking to the latter for permission for the

renovation when the father himself appears to be the very same vendor who
sold the property to another vendee earlier.
Both Deeds of Absolute Sale of the litigating parties were notarized,
only that the one notarized by Jose V. Cruz, which is the deed of sale by
Pedro Dimaiwat to Dra. Ramirez. Jose V. Cruz, is admittedly a non-lawyer
and he failed to submit his notarial report to the Clerk of Court of the
Regional Trial Court.
The question of the effect of the notary public not being a lawyer is
inconsequential. Non-lawyers were commissioned as notaries public before
the authority was withdrawn by the Supreme Court. And whether or not the
notary public who notarized the deed of sale executed by Pedro Dimaiwat in
favour of Antonia Ramirez submitted or not his report to the Clerk of Court
of the RTC, the same is administrative and does not affect the probative
value of the notarized document. Jurisprudence has it that:
A notarial document is by law entitled to full faith and
credit upon its face. (Ramirez vs. Ner, 21 SCRA 207). As such
it ... must be sustained in full force and effect so long as he who
impugns it shall not have presented strong, complete and
conclusive proof of its falsify or nullity on account of some flaw
or defect provided against by law (Robinson vs. Villafuerte,
18 Phil 171, 189-190, as cited in Rorasoso, et al. vs. Soria,
et al., G.R. No. 194846, June 19, 2013)
The Deed of Absolute Sale executed by Pedro Dimaiwat in favour of
her daughter and son-in-law is also notarized in fact registered. Registration
alone however does not confer superior right to them. As the Supreme Court
ruled:
In another case, it was held that if a vendee in a double
sale registers the sale he has acquired knowledge of a previous
sale, the registration constitutes a registration in bad faith and
does not confer upon him any right. If the registration is done in
bad faith, it is as if there is no registration at all, and the buyer
who has first taken possession of the property in good faith shall
be preferred. (Rosaroso, et al. vs. Soria, et al., G.R. No.
194846, June 19, 2013)
Plaintiffs mother, Dra. Ramirez, was cheated and deceived. The
property Pedro Dimaiwat and Dionisia Dimaiwat sold to her was sold again to
Marilyn Dimaiwat-Rances and Santos Rances, only for Pedro Dimaiwat to
later execute a Deed of Absolute Sale in favor of Dra. Ramirez. Clearly, this
is not the ideal in human relations and warrants the award of moral damages
to the plaintiffs based on the provisions of Article 2219, in connection with
Articles 19, 20 and 21 of the Civil Code.
Article 19 of the Civil Code provides:

Art. 19. Every person must, in the exercise of his rights and in
the performance of his duties, act with justice, give everyone his
due, and observe honesty and good faith.
The foregoing provisions sets the standards which may be
observed not only in the exercise of ones right but also in the
performance of ones duties. When right is exercised in a
manner which does not conform with the norms enshrined in
Article 19 and result in damage to another, a legal wrong is
thereby committed for which the wrongdoer must be held
responsible. But a right, though by itself legal because
recognized or granted by law as such, may nevertheless become
the source of some illegality. A person should be protected only
when he acts in the legitimate exercise of his right; that is, when
he acts with prudence and in good faith, but not when he acts
with negligence or abuse. There is an abuse of right when it is
exercised only for the purpose of prejudicing or injuring another.
The exercise of a right must be in accordance with the purpose
for which it was established, and must not be excessive or
unduly harsh; there must be no intention to injure another.
In order to be liable for damages under the abuse of rights
principle, the following requisites must concur: (a) the existence
of a legal right or duty, (b) which is exercised in bad faith; and
(c) for the sole intent of prejudicing or injuring another.
It should be stressed that malice or bad faith is at the core
of Article 19 of the Civil Code. Good faith is presumed, and he
who alleges bad faith has the duty to prove the same. Bad faith,
on the other hand, does not simply connote bad judgment to
simple negligence, dishonest purpose or some moral obloquy
and conscious doing of a wrong, or a breach of known duty due
to connotes ill will or spite and speaks not in response to duty. It
implies an intention to do ulterior and unjustifiable harm. (Heirs
of Nala vs. Cabansag, G.R. No. 161188, June 13, 2008)
Corollarilly, Article 20 provides that every person who, contrary to
law, wilfully or negligently cause damage to another shall indemnify the
latter for the same. It speaks of the general sanctions of all other provisions
of law which do not especially provide for its own sanction. When a right
exercised in a manner which does not conform to the standards set forth in
the said provision and results in damage to another, a legal wrong is thereby
committed for which the wrongdoer must be responsible. Thus, if the
provision does not provide a remedy for its violation, an action for damages
under either Article 20 or Article 21 of the Civil Code would be proper.
(Ardiente vs. Spouses Pastorfide, et al., G.R. No. 161921, July 17, 2013)
An award of exemplary damages is also proper under Article 2229
which provides the exemplary damages may be imposed by way of example
or correction for the public good. Nonetheless, exemplary damages are
imposed not to enrich one party or impoverish another, but to serve as a

deterrent against or as a negative incentive to curb socially deleterious

actions. (id.)
With respect to the award of attorneys fees, Article 2208 of the Civil
Code provides, among others, that such fees may be recovered when
exemplary damages are awarded, when the defendants act or omission has
compelled the plaintiff to litigate with third persons or to incur expenses to
protect his interest, and where the defendant acted in gross and evident bad
faith in refusing to satisfy the plaintiffs plainly valid, just and demandable
claim. (id.)
WHEREFORE, finding preponderance of evidence in favour of the
plaintiffs and against the defendants, decision is hereby renedered:
1. Declaring the Deed of Absolute Sale of the proper in question
between Defendant Spouses Pedro Dimaiwat and Lucia Capili to
the Spouses Santos Rancer, Jr. and Marilyn D. Rances null and
void;
2. Ordering the DENR Office of Iriga City, the Office of the Register
of Deeds of Iriga City to annul Katibayan ng Orihinal na Titulo
Blg. 2322 and that a new certificate of title be issued in favour of
the plaintiffs being the legitimate heirs of Dra. Antonia A.
Ramirez after complying with the requisites provided by law;
3. Ordering defendant Assessor of Iriga City to cancel ARP No. 0223239 with PIN No. 136-04-022-05-139 in the name of
defendants Santos Rances Jr. and a new ARP be issued in favour
of the plaintiffs.
4. Ordering defendants to pay the plaintiffs the amount of
P20,000.00 as moral damages, P10,000.00 as exemplary
damages, and P5,000.00 as attorneys fees.
SO ORDERED.
7 May 2015, Iriga City, Philippines.

Sgd.
TIMOTEO A. PANGA, JR.
Judge