Sometime in 1985 Amor Ruiz and Honorato Hong executed a Memorandum of Agreement whereby

Hong took possession of the TCT for safekeeping because Amor Ruiz in her personal capacity borrowed
money from the Honorato Hong.

April 23, 1986 Genaro Ruiz Sr. sold Lot No. 8485-B covered by TCT No. 2125 in Tabunok Talisay, Cebu to
Honorato Hong for PHP 350,000 evidenced by a duly notarized deed of sale

Sometime in July 1986 Amor Ruiz demanded the return of the TCT from Honorato Hong alleging that
she would undertake registration of the sale and transfer of title to Honorato Hong. The transfer of title
however never materialized.

July 22, 1986 Upon learning about what his wife did Genaro Ruiz Sr. executed another deed of sale
with the same contents and was also duly notarized.

August 18, 1986 Amor Ruiz and her children, Genaro Ruiz Jr. Angelo Ruiz and Maria Ruiz filed with the
Regional Trial Court of Cebu a complaint for support against her husband with a prayer for a writ of
attachment over Lot 8485-B. Honorato Hong filed a third party claim declaring that the subject lot was
his exclusive property.

November 9, 1988 In the support case, the Regional Trial Court approved of a compromise agreement
whereby Genaro Ruiz Sr. acknowledged his obligation for support in arrears in the amount of PHP
363,000 and PHP 20,000 in attorneys fees. Upon the failure of Genaro Ruiz to comply with his obligation
the trial judge issued a writ of execution directing the sheriff to enforce the same.

January 26, 1989 Honorato Hong filed a case for Specific Performance case with damages for the
delivery of the title of the subject land and a prayer for a writ of preliminary injunction against Genaro
Ruiz, Sr. and/or Amor Ruiz, et al from conducting the auction sale. The trial court however did not act on
the latter so the auction sale proceeded with Amor Ruiz as lone bidder.

June 13, 1989 Execution sale

July 27, 1989 Genaro Ruiz, Sr. died.

August 27, 1990 The Trial court issued a writ of preliminary injunction in favor of Honorato Hong
enjoining the sheriff from issuing the certificate of sale to the Ruizes. This order was assailed by the
Ruizes and filed a petition for certiorari with the Court of Apeals.

September 28, 1990 - While the petition of the Ruizes assailing the writ of preliminary injunction was
still pending with the Court of Appeals, the trial court in the Specific Performance case rendered a
decision in favor of Honorato Hong ordering Amor Ruiz to deliver the TCT and vacate the premises and
declaring the writ of attachment, levy and execution sale null and void.

March 23, 1992 The Court of Appeals annulled and set aside the orders of the Regional Trial Court
dated August 27, 1990 which granted the writ of preliminary injunction enjoining the Sheriff of Cebu
from issuing the certificate of sale in favor of Amor Ruiz. On the strength of the decision Amor Ruiz and
her children were placed in the possession of and control of certain portions of Lot 8485-B.

Hong filed a motion for reconsideration alleging that a writ of possession aca not be tissued in favor of
Amor Ruiz since he was in actual physical possession of the subject lot pursuant to rule 39, section 35.

June 1, 1994 - Petitioners moved for the full implementation of the writ of possession in their favor
which was denied by the trial court. Petitioners went to the court of appeals raising the pivotal issue as
to whether the respondent court can be compelled to order the respondent sheriff to deliver possession
of Lot 8485-B to herein petitioners.

February 10, 1995 The Court of Appeals ruled in favor of Honorato Hong declaring that respondent
Hong is already adjudged the owner of Lot 8485-B, the respondent court had no power to enforce
authority over such property since it belongs to a person other than the judgement debtor and
consequently petitioners are not entitled to its possession. Petitioners filed another petition with this
court alleging that:
RESPONDENT COURT GRAVELY ABUSED ITS DISCRETION, AMOUNTING TO

LACK OR EXCESS OF JURISDICTION, IN UPHOLDING THE TRIAL COURT'S

REFUSAL TO IMPLEMENT THE WRIT OF POSSESSION IT ISSUED OVER LOT NO.

8485-B IN FAVOR OF PETITIONERS, CONSIDERING THE LATTER'S

UNQUESTIONABLE OWNERSHIP AND RIGHT OF POSSESSION THEREOF.

January 29, 1996 The court resolved to consolidate the two petitions.

July 31, 1995 The petitioners dissatisfied, appealed to the Court of Appeals but the respondent court
affirmed the decision of the trial court in toto.

Issue: Who between the parties has a preferred right over the subject land?

Ruling:

The Supreme Court declared private respondent Hong as the rightful owner of the subject land. Where a
party has knowledge of a prior existing interest which is unregistered at the time he acquired a right to
the same land, his knowledge of that prior unregistered interest has the effect of registration as to him.
Knowledge of an unregistered sale is equivalent to registration.

The Court also considered the statement of Genaro when he submitted his Answer in the case filed by
his wife and children for Support where he respectfully prayed to the court to issue an order to lift the
order of attachment on the real property, more particularly on Lot 8485-B which he sold on April 23,
1986 for the reason that since that date he no longer owned it. Said statement was a declaration made
by the owner himself, which could be considered as a declaration against interest. Genaro Ruiz, Sr., the
registered owner, categorically stated that he had already sold the land to Hong on April 23, 1986 so that
his wife had no basis to attach the subject land. Genaro Ruiz, Sr. would not have made the allegation if it
were not true. Such statement must be given weight and credence as against the party who declares
otherwise and has no proof to rebut the same.