Carbonell vs.

Court of Appeals, and Poncio

Carbonell vs. Court of Appeals, and Poncio

69 SCRA 99
January 1976

FACTS:

On January 27, 1955, respondent Jose Poncio executed a private memorandum of sale
of his parcel of land with improvements situated in San Juan, Rizal in favor of
petitioner Rosario Carbonell who knew that the said property was at that time
subject to a mortgage in favor of the Republic Savings Bank (RSB) for the sum of
P1,500.00. Four days later, Poncio, in another private memorandum, bound himself to
sell the same property for an improved price to one Emma Infante for the sum of
P2,357.52, with the latter still assuming the existing mortgage debt in favor of
the RSB in the amount of P1,177.48. Thus, in February 2, Poncio executed a formal
registerable deed of sale in her (Infante's) favor. So, when the first buyer
Carbonell saw the seller Poncio a few days afterwards, bringing the formal deed of
sale for the latter's signature and the balance of the agreed cash payment, she was
told that he could no longer proceed with formalizing the contract with her
(Carbonell) because he had already formalized a sales contract in favor of Infante.

To protect her legal rights as the first buyer, Carbonell registered on February 8,
1955 with the Register of Deeds her adverse claim as first buyer entitled to the
property. Meanwhile, Infante, the second buyer, was able to register the sale in
her favor only on February 12, 1955, so that the transfer certificate of title
issued in her name carried the duly annotated adverse claim of Carbonell as the
first buyer. The trial court declared the claim of the second buyer Infante to be
superior to that of the first buyer Carbonell, a decision which the Court of
Appeals reversed. Upon motion for reconsideration, however, Court of Appeals
annulled and set aside its first decision and affirmed the trial courts decision.

ISSUE:

Who has the superior right over the subject property?

COURT RULING:

The Supreme Court reversed the appellate courts decision and declared the first
buyer Carbonell to have the superior right over the subject property, relying on
Article 1544 of the Civil Code. Unlike the first and third paragraphs of said
Article 1544, which accord preference to the one who first takes possession in good
faith of personal or real property, the second paragraph directs that ownership of
immovable property should be recognized in favor of one "who in good faith first
recorded" his right. Under the first and third paragraphs, good faith must
characterize the prior possession, while under the second paragraph, good faith
must characterize the act of anterior registration.

When Carbonell bought the lot from Poncio on January 27, 1955, she was the only
buyer thereof and the title of Poncio was still in his name solely encumbered by
bank mortgage duly annotated thereon. Carbonell was not aware - and she could not
have been aware - of any sale to Infante as there was no such sale to Infante then.
Hence, Carbonell's prior purchase of the land was made in good faith which did not
cease after Poncio told her on January 31, 1955 of his second sale of the same lot
to Infante. Carbonell wanted to meet Infante but the latter refused so to protect
her legal rights, Carbonell registered her adverse claim on February 8, 1955. Under
the circumstances, this recording of Carbonells adverse claim should be deemed to
have been done in good faith and should emphasize Infante's bad faith when the
latter registered her deed of sale 4 days later.