GUARANTEED HOMES, INC. v.

VALDEZ
G.R. No. 171531| 30 JANUARY 2009
HEIRS OF MARIA P. VALDEZ, (EMILIA V. YUMUL and VICTORIA
V. MOLINO), HEIRS OF SEVERINA P. TUGADE (ILUMINADA and
LEONORA P. TUGADE), HEIRS OF ETANG P. GATMIN (LUDIVINA
GUARANTEED HOMES, INC. v. G. DELA CRUZ by and through ALFONSO G. DELA CRUZ,
HILARIA G. COBERO and ALFREDO G. COBERO) and SIONY G.
TEPOL, by and through ELENA T. RIVAS and ELESIO TEPOL, JR.,
AS HEIRS OF DECEDENT PABLO PASCUA
Petition for review on certiorari of CA decision and resolution.
Justice Tinga
FACTS: CA reversed the order of RTC-Olongapo, which granted the motion to dismiss filed by
petitioner Guaranteed Homes.

Respondents, descendants of Pablo Pascua, filed a complaint seeking reconveyance

of a parcel of land in Cabitaugan, Subic Zambales and covered by OCT No. 404 in the
name of Pablo.

They are praying for damages.

From the annexes attached in the complaint, it was ascertained that the OCT
contained several annotations which showed that the property had been sold by
Pablo to Alejandria Marquinez and Resituto Morales.

Also attached in the complaint, and averred by the respondents:

o Extrajudicial Settlement of a Sole Heir and Confirmation of Sales executed by
Cipriano Pascua, Sr., declaring himself as the only heir of Pablo and
confirming the sales made by Pablo to spouses Rodolfo;
o TCT Nos. T-8241 issued in the name of Cipriano without cancellation of OCT
No. 404 & not signed by Register of Deeds;
o TCT No. T-8242 issued in the name of spouses Rodolfo, which canceled T-
8241;
o TCT No. T-10863 issued in the name of petitioner when spouses Rodolfo
sold the property to petitioner, which canceled T-8242;
o Deed of Sale with Mortgage between spouses Albino Rodolfo and Fabia
Rodolfo and Guaranteed Homes;

Jorge Pascua, Sr., son of Cipriano filed a petition with RTC-Olongapo for the issuance
of a new owners duplicate of OCT No. 404, which was denied. The trial court held
that petitioner was already the owner of the subject property, noting that the failure
to annotate the subsequent property to it at the back of said OCT did not affect its
title to the property.

Petitioner filed a motion to dismiss the complaint on the following grounds:

o Action is barred by the Statute of Limitations (since more than 28 years have
passed since the issuance from T-10863 to the filing of the complaint);
o No cause of action, since petitioner is an innocent purchaser for value relying
on the clean title of spouses Rodolfo.

RTC granted the motion.

CA reversed and held that the respondents complaint for quieting of title had not yet
prescribed.

Hence, this petition.

ISSUE: Whether petitioner is an innocent purchaser for value, i.e. there is no need to go beyond
the registered title of spouses Rodolfo.
HELD: Yes (there is no need for petitioner to go beyond the clean title presented to them).
Petition granted. CA decision reversed and set aside.
RATIO: The Court held that it is basic that a person dealing with registered property need not
go beyond, but only has to rely on, the title of his predecessor-in-interest. Since the
act of registration is the operative act to convey or affect the land insofar as third
persons are concerned, it follows that where there is nothing in the certificate of title
to indicate any cloud or vice in the ownership of the property, or any encumbrance
thereon, the purchaser is not required to explore farther than what the Torrens title
upon its face indicates in quest for any hidden defect or inchoate right that may
subsequently defeat his right thereto.

In the present case, it is enough that petitioner examined the latest certificate of title
issued in the name of spouses Rodolfo. The petitioner as purchaser is not bound by
the original certificate but only by the certificate of title of the person from whom he
had purchased the property.

Furthermore, registration in the public registry is considered a notice to the whole

world. Every conveyance, mortgage, lease, lien, attachment, order, judgment,
instrument or entry affecting registered land shall be, if registered, filed or entered in
the Office of the Register of Deeds of the province or city where the land to which it
relates lies, be constructive notice to all persons from the time of such registering,
filing or entering.