Case2

Davao Union Cement Corporation

1. Transfer Certificate Title

Under Section 43 of Presidential Decree 1529, a Transfer Certificate of Title is the

subsequent certificate of title that may be issued by the Register of Deeds pursuant to
any voluntary or involuntary instrument relating to the same land shall be in like form,
entitled "Transfer Certificate of Title", and likewise issued in duplicate. The certificate
shall show the number of the next previous certificate covering the same land and also
the fact that it was originally registered, giving the record number, the number of the
original certificate of title, and the volume and page of the registration book in which
the latter is found.1

The TCT, a document issued by the Land Registration Commission, is the best
evidence of ownership of a real estate registered under the Torrens System. 2
However, the court as also laid down the doctrine that there are instances when such a
fraudulent document may become the root of a valid title. One such instance is where
the certificate of title was already transferred from the name of the true owner to the
forger, and the land was subsequently sold to an innocent purchaser. For then, the
vendee had the right to rely upon what appeared in the certificate.3

Upon examination of the TCT, the subject real estate property for sale is registered
to Romeo Manlapuz Baquirel who is married to Eufemia V. Baquirel, both of legal age,
and Filipinos. There is discrepancy, because the subject land should be registered under
the name of Davao Union Cement Corporation (Davao) who is the seller. When you
compare the TCT with the Real Property Tax Clearance and the Tax Declaration, the
registered owner appearing in the latter documents is Davao Union Cement
Corporation and not the Sps. Baquirel.

1
Amending and Codifying the Laws Relative To Registration of Property and for Other Purposes
[SPROPERTY REGISTRATION DECREE], P.D. No. 1529, S 43 (1978).
2
HEIRS OF LEOPOLDO VENCILAO, SR., Heirs of Leopoldo Vencilao, Sr., v. Court of Appeals, G.R. No.
123713, April 1, 1998 available at http://sc.judiciary.gov.ph/jurisprudence/1998/apr1998/123713.htm
(last accessed November 4, 2018).
3
Inquimboy vs. Cruz, G.R. No. L-13953, July 28, 1960 available at
https://www.lawphil.net/judjuris/juri1960/jul1960/gr_l-13953_1960.html (last accessed Nov. 5, 2018).
 The TCT likewise states that, the certificate “is a transfer from TRANSFER
CERTIFICATE OF TITLE T-82989 (TOTALLY CANCELLED) by virtue hereof and in so far as
the above -described land is concerned.” This means that the previous TCT T-82989
was totally cancelled with the issuance of the current TCT No. 146-2015001447 issued
under the new registered owner, Romeo Baquirel who is married to Eufemia Baquirel,
which was registered on May 16, 2014.

2. Real Property Tax Clearance and Tax Declaration

As regards the Real Property Tax Clearance And Tax Declaration, both documents
certify that according to the records of the Office of the City Assessor and the Office of
the City Treasurer, Davao Union Cement Corporation is the declared owner of the
property. However, upon close examination of both documents, both state that the
property is covered by TCT No. T-82989. This is another discrepancy, because T-82989
was already cancelled by the new TCT registered under the name of Romeo Baquirel.

Take note that the assessment done by the City Assessor became effective on
January 1, 2014. On the other hand, the new TCT issued was entered in the book of
registry on May 16, 2014. This is another inconsistency in the documents being
validated.

3. Conducting Due Diligence in Buying Real Estate Property

A law firm gives advice on how to conduct due diligence in buying real estate
properties in the Philippines, particularly when dealing with a juridical entity, i.e. a
corporation. According to Nicolas & De Vega Law Offices:

When it comes to contracts, most parties conduct due diligence on

each other. If one is dealing with a corporation, it is necessary to
ensure that the corporation is legitimate. One can go to
www.sec.gov.ph to check the articles of incorporation and other
corporate documents. It is highly recommended to read the latest
General Information Sheet (GIS) of the company to determine the
present stockholders and directors. A visit to the Securities &
Exchange Commission can also be made to get these documents.
These documents are essential since contracts entered into by a
corporation must be supported by a corresponding Board Resolution
and Secretary’s Certificate.4

4
How to Conduct Due Diligence in the Philippines, para. 5, available at
https://ndvlaw.com/how-to-conduct-due-diligence-in-the-philippines/ (last accessed Nov. 4, 2018).
4. Homestead Patent

The land was originally registered as a Homestead Patent, with Patent Date January
1, 1929. The Original Certificate of Title was issued on March 5, 1929 with OCT No.
OCT-471.

A Homestead Patent is a mode of acquiring alienable and disposable lands of the

public domain for agricultural purposes conditioned upon actual cultivation and
residence.5

In the Tax Declaration, there was notice- a memoranda- that the land was
reclassified from agricultural to industrial use. It is not necessary to ascertain if the
land was alienable or disposable since the TCT already states that the property was
originally registered as a Homestead Patent. This means, that the land was already
deemed alienable and disposable by the government so it was awarded thru a patent.

5 Homestead Patent, available at

http://lmb.gov.ph/index.php/87-programs-and-projects/ii-land-disposition/11-ld-homestead-patent (last accessed
Nov. 5, 2018).