594 SCRA 555 Civil Law Land Titles and Deeds Innocent Purchaser Sunshine

Finance Doctrine
Eagle Realty Corporation, a company engaged in the real estate business, bought a parcel
of land from a certain Reyes in 1984 via a Deed of Sale. This Reyes acquired the land from
a certain Medina who earlier acquired the said land via surreptitiously entering a false
record in the records of the Land Registration Commission. Eventually, the true owners of
the said land, the de Leons, discovered that another title was fraudulently issued to Medina
over the same parcel of land. De Leon was able to have the said title annulled as well as
the TCT issued to Eagle Realty by virtue of the Deed of Sale.
ISSUE: Whether or not Eagle Realty is an innocent purchaser.
HELD: No. Based on case law (Sunshine Finance vs IAC, Oct. 28, 1991 / 203 SCRA 210),
a corporation engaged in the buying and selling of real estate is expected to exercise a
higher standard of care and diligence in ascertaining the status and condition of the
property subject of its business transaction. Similar to investment and financing
corporations, it cannot simply rely on an examination of a Torrens certificate to determine
what the subject property, looks like as its condition is not apparent in the document.