LAND TITLES CASES
of P244,594.10, representing the value of the dishonored checks plus
ADVERSE CLAIMS
FLOR MARTINEZ, REPRESENTED BY MACARIO MARTINEZ,
AUTHORIZED REPRESENTATIVE AND ATTORNEY-IN-FACT,
PETITIONER, VS. ERNESTO G. GARCIA AND EDILBERTO M.
BRUA, RESPONDENTS.
DECISION
PERALTA, J.:
Before us is a special civil action for certiorari under Rule 65 of the
Rules of Court to annul and set aside the Decision1 dated August 12,
2004 and the Resolution2 dated November 18, 2004 of the Court of
Appeals (CA) in CA-G.R. CV No. 61591, which reversed and set aside
the Decision3 dated April 15, 1998 and Order4 dated August 11, 1998
of the Regional Trial Court (RTC) of Pasig, Branch 267, in Special Civil
Action No. 574.
The factual antecedents are as follows:
Respondent Edilberto Brua was the registered owner of a parcel of
land located in Mandaluyong, Rizal, covered by Transfer Certificate of
Title (TCT) No. 346026 of the Registry of Deeds of Rizal, which is the
subject matter of this case. The property was first mortgaged to the
Government Service Insurance System (GSIS), and such mortgage
was annotated at the back of TCT No. 346026 as Entry No. 91370,
inscribed on June 5, 1974.5 On February 5, 1980, respondent Brua
obtained a loan from his brother-in-law, respondent Ernesto Garcia, in
the amount of One Hundred Fifty Thousand Pesos (P150,000.00) and,
to secure the payment of said loan, respondent Brua mortgaged the
subject prbperty to respondent Garcia, as evidenced by a Deed of Real
Estate Mortgage6 executed in respondent Garcia's favor. Since the title
to the subject property was in the possession of the GSIS and
respondent Garcia could not register the Deed of Real Estate
Mortgage, he then executed an Affidavit of Adverse Claim7 and
registered it with the Registry of Deeds of Rizal on June 23, 1980 as
Entry No. 49853/T-346026,8 which remained uncanceled up to this
time.
Sometime in October 1991, respondent Brua requested respondent
Garcia to pay the former's loan with the GSIS, so that the title to the
subject property would be released to the latter. Respondent Garcia
then paid GSIS the amount of P400,000.00 and, thus, the title to the
subject property was released to him.
On October 22, 1991, a Deed of Absolute Sale9 was executed between
respondents Garcia and Brua over the subject property, where
respondent Brua sold the property in the amount of P705,000.00. In
the same deed, it was stated that the subject property was only a
partial payment of respondent Brua's mortgage indebtedness to
respondent Garcia, which he could no longer redeem from the latter.
Respondent Garcia then registered the Deed of Sale with the Registry
of Deeds of Rizal on October 24 1991, and a new TCT No. 520410 was
issued in the names of respondent Garcia and his wife. However, the
annotations at the back of the previous title were carried over to the
new title, to wit: Entry No. 56837, a Notice of Levy on Attachment
and/or Levy inscribed on January 8, 1981;11 Entry No. 2881 showing a
Notice of Levy on Execution in favor of petitioner Flor Martinez, which
was inscribed on July 11, 1988;12 Entry No. 3706, which was a
Certificate of Sale in favor of petitioner inscribed on September 2,
1988;13 Entry No. 72854, which was a Notice of Levy on Execution in
favor of Pilipinas Bank inscribed on December 8, 1981; 14 and Entry No.
16611 inscribed on October 24, 1991, which was the cancellation of
respondent Brua's mortgage with GSIS.15
It appeared that the annotations found at the back of the title of the
subject property in favor of petitioner, i.e., Notice of Levy on
Attachment and/or Levy, Notice of Levy on Execution, and Certificate
of Sale, were all made in connection with petitioner's action for
Collection of Sum of Money, which she filed against respondent Brua
at the RTC of Makati City, Branch 60, docketed as Civil Case No.
39633. In that case, a decision was rendered in favor of petitioner,
where the RTC ordered respondent Bma to pay the former the amount
12% interest per annum as damages and the premium paid by
petitioner for the attachment bond. The decision became final and
executory as respondent Brua failed to appeal the same, and a notice
of levy on execution was issued. A public auction was subsequently
conducted, where the subject property was awarded to petitioner as
the sole bidder in the amount of P10,000.00, and a Certificate of Sale
was issued in her favor.
The annotation of Pilipinas Bank's Notice of Levy on Execution
annotated as Entry No. 72854 on the title of the subject property was
by virtue of a civil case filed by Filipinas Manufacturers Bank, now
known as Pilipinas Bank, against respondent Brua.
On February 9, 1994, respondents Garcia and Brua filed with the RTC
of Pasig, Branch 267, an Action to Quiet Title, initially against petitioner
due to the encumbrances/liens annotated on respondent Garcia's new
title. They contended that these encumbrances/liens were registered
subsequent to the annotation of respondent Garcia's adverse claim
made in 1980, and prayed that these be canceled. Subsequently, the
complaint was amended to include Pilipinas Bank as an additional
defendant. Petitioner and Pilipinas Bank filed their respective Answers
thereto. Trial thereafter ensued.
On April 15, 1998, the RTC rendered its decision dismissing
respondent Garcia's action for quieting of title, the dispositive portion of
which reads:
WHEREFORE, PREMISES CONSIDERED, the instant complaint is
hereby dismissed for lack of merit and judgment is hereby rendered in
favor of defendants Flor Martinez and Pilipinas Bank as against
plaintiffs Ernesto Garcia and Edilberto Brua who are further directed to
pay both defendants attorney's fees in the amount of P50,000.00 each.
Accordingly, the judicial inscriptions particularly, Entry No. 3706/T-
346026, annotation of certificate of sale and Entry No. 72854/T-346026
are held to be valid, subsisting liens which do not constitute a cloud on
Transfer Certificate of Title No. 5204.16
In so ruling, the RTC found that the adverse claim which respondent
Garcia caused to be annotated on the previous title of the subject
property, i.e, TCT No. 346026, on June 23, 1980 was predicated on his
interest as a mortgagee of a loan of PI 50,000.00, which he extended
to respondent Brua; that respondent Garcia's adverse interest was
merely that of a second mortgagee, as he was not yet the purchaser of
the subject property as of said date; that when the judicial liens, i.e.,
Notice of Levy on Attachment and/or Levy and Notice of Levy on
Execution, were caused to be registered by petitioner on respondent
Brua's title on January 8, 1981 and July 8, 1998, respectively, by virtue
of petitioner being adjudged judgment creditor by Branch 60 of RTC
Makati, respondent Garcia's claim became inferior to that of petitioner.
The RTC said that respondent Garcia's inaction to preserve his
adverse claim as a second mortgagee, which was inscribed on June
23, 1980, and his sudden decision to redeem and purchase the subject
property from the GSIS in October 1991 -- when petitioner's Notice of
Levy on Attachment and/or Levy, Notice of Levy on Execution and
Certificate of Sale were already inscribed at the back of respondent
Brua's title -- showed bad faith on the part of respondent Garcia; that
respondent Brua did not even testify or participate in the case, except
when he was impleaded as a plaintiff in the case. The RTC did not give
credit to respondent Garcia's claim that he and respondent Brua had
no prior knowledge of the occurrence of a public auction and the
consequent annotation of the certificate of sale, and found respondent:
Garcia to be a buyer in bad faith of the subject property.
The RTC also ruled that the Notice of Levy on Execution, which was
annotated on December 8, 1981 as Entry No. 72854 on respondent
Brua's title arising from Civil'Case No. 7262 entitled "Pilipinas Bank v.
Edilberto Brua" was a valid levy on the subject property in favor of
Pilipinas Bank. The levy could not be canceled, as this would impair
the interest of the bank which had been decided upon by a co-equal
court. The RTC found that the sale between respondents appeared to
be tainted with bad faith, which constrained petitioner and Pilipinas
Bank from engaging the services of lawyers; thus, the award of
attorney's fees in the latter's favor.

Respondents' motion for reconsideration was denied by the RTC on
August 11, 1998.
Respondents filed their appeal with the CA. However, respondent Brua
failed to file his appellant's brief; thus, his appeal was considered
abandoned and dismissed. Petitioner and Pilipinas Bank filed their
respective appellees' briefs.
On August 12, 2004, the CA reversed and set aside the RTC decision,
the dispositive portion of which reads:
WHEREFORE, the appealed Decision dated April 15, 1998 is
REVERSED and SET ASIDE. Granting the instant appeal, Entry No.
72854 (Notice of Levy on Execution in favor of Pilipinas Bank), Entry
No. 2881 (Notice of Levy on Execution in favor of Flor Martinez) and
Entry No. 3706 (Certificate of Sale in favor of Flor Martinez) inscribed
in TCT No. 346026 and carried over to TCT No. 5204, are hereby
CANCELLED.17
The CA said that a subsequent sale of property covered by a certificate
of title cannot prevail over an adverse claim, duly sworn to and
annotated on the certificate of title previous to the sale; that while one
who buys a property from the registered owner need not have to look
behind the title, he is nevertheless bound by the liens and
encumbrances annotated thereon; and, thus, one who buys without
checking the vendor's title takes all the risks and losses consequent to
such failure. The CA found that in order to protect his interest,
respondent Garcia executed an Affidavit of Adverse Claim on June 23,
1980, annotated it on the title of the subject property under Entry No.
49853 and it has remained uncanceled up to this time; that such
adverse claim was registered prior to the inscription of the Certificate of
Sale in favor of petitioner under Entry No. 3706 and Pilipinas Bank's
Notice of Levy on Execution under Entry No. 72854; that the prior
registration of respondent Garcia's adverse claim effectively gave
petitioner and Pilipinas Bank notice of the former's right to the subject
property and, thus, petitioner was deemed to have knowledge of
respondent Garcia's claim and could not be considered as a buyer in
good faith at the time she purchased the subject property in the public
auction; that petitioner could not claim that she was a purchaser in
good faith, since respondent Garcia's adverse claim was entered on
June 23, 1980, eight years ahead of petitioner's Certificate of Sale on
September 2, 1988; that when the Notice of Levy on Execution in favor
of Pilipinas Bank was annotated on respondent Brua's title, the sheriff
who caused the annotation was charged with knowledge that the
property sought to be levied upon on execution was encumbered by an
interest, which was the same if not better than that of the registered
owner thereof; and that such notice of levy could not prevail over the
existing adverse claim of respondent Garcia inscribed on the title as
can be deduced from Section 12, Rule 39 of the Rules of Court.
The CA found that the RTC erred in concluding that respondent Garcia
was a purchaser in bad faith, since his adverse claim was entered in
respondent Brua's title in 1980, and respondent Garcia could not have
foretold at the time he caused such annotation of adverse claim that
petitioner would purchase the same property eight years thereafter;
and that while good faith is presumed, bad faith must be established by
competent proof by the party alleging the same; and, thus, in the
absence of respondent Garcia's bad faith, he is deemed to be a
purchaser in good faith, and his interest in the property must not be
disturbed.
The CA also found that a Notice of Adverse Claim remains valid even
after the lapse of 30 days, as provided for in Sec, 70 of Presidential
Decree No. (PD) 1529 pursuant to our ruling in Sajonas v. CA; that
since no petition was filed by petitioner for the cancellation of
respondent Garcia's Notice of Adverse Claim, the adverse claim
subsisted and his rights over the subject property must consequently
be upheld.
Petitioner's motion for reconsideration was denied by the CA in a
Resolution dated November 18, 2004.
Petitioner is now before us via a petition for certiorari under Rule 65, i
alleging grave abuse of discretion amounting to lack or excess of
jurisdiction committed by the CA in issuing its assailed decision and
resolution.
Petitioner contends that respondent Garcia's adverse claim is nothing
but a notice that he has an interest adverse to that of respondent Brua
to the extent of PI 50,000.00, which was the amount of the loan
secured by a Deed of Real Estate Mortgage executed by respondent
Brua in favor of respondent Garcia; that the adverse claim cannot be
said to be superior to a final sale conducted by the sheriff by authority
of the court pursuant to a judgment that has attained finality;
that Sajonas v. CA, on which the CA anchored its decision, differs from
this case, since the adverse claim made in the title by therein petitioner
Sajonas was by virtue of a contract to sell; that unlike in this case,
respondent Garcia caused the annotation of his adverse claim as a
mortgagee of respondent Brua in the amount of P150,000.00 in 1980;
and respondent Garcia's payment of the GSIS loan in 1991, upon the
request of respondent Brua, was presumably for the reason that
respondent Brua could no longer discharge the GSIS obligation; and to
avoid the foreclosure of the property by the GSIS, respondent Brua
asked Garcia to redeem it; that respondent Garcia's adverse claim in
1980 was not as a vendee of the property like in Sajonas, but merely
as a mortgagee.
Petitioner admits' that respondent Garcia, as a mortgagee on the basis
of which an adverse claim was inscribed on the title of the subject
property, is protected by Sec. 12, Rule 39 of the Rules of Court; and,
thus, petitioner knows that she is obliged as a vendee in the public sale
to pay liens and encumbrances then existing at the time of the sale on
September 2, 1988, which necessarily included the adverse claim of
respondent Garcia in the amount of P150,000.00.
In his Comment, respondent Garcia claims that the petition faces
outright dismissal, since the appropriate remedy of the petitioner
should have been a petition for review under Rule 45 which had
already lapsed; that when the CA reversed the RTC decision, such
action did not constitute grave abuse of discretion since it had legal
basis; that any lien or adverse claim earlier inscribed prevails over
those liens or adverse claims inscribed subsequent thereto.
Respondent Brua did not file his comment. Thus, we dispensed with
the filing of the same in a Resolution dated June 19, 2006.
Petitioner filed her Reply, arguing that a petition for certiorari may be
availed of where appeal is inadequate and ineffectual.
The parties submitted their respective memoranda as required in Our
Resolution dated August 30, 2006.
We dismiss the petition.
Petitioner should have filed a petition for review under Rule 45 of the
Rules of Court instead of a petition for certiorari under Rule 65, since
she is assailing the CA decision and resolution which are final
judgments. Rule 45 clearly provides that decisions, final orders or
resolutions of the CA in any case, i.e., regardless of the nature of the
action or proceedings involved, may be appealed to us by filing a
petition for review, which is just a continuation of the appellate process
over the original case.18 And the petition for review must be filed within
fifteen (15) days from notice of the judgment or final order or resolution
appealed from, or of the denial of petitioner's motion for a new trial or
reconsideration filed in due time after notice of the judgment. 19
In this case, petitioner received a copy of the CA Resolution denying
her motion for reconsideration on November 24, 2004; and, thus,
under Rule 45, she has 15 days from receipt of such resolution, or until
December 9, 2004, to file a petition for review. However, petitioner did
not file a petition for review; instead, she filed a petition
for certiorari under Rule 65 on January 24, 2005.20 Hence, the CA
decision and resolution have already attained finality, and petitioner
has lost her right to appeal.
A petition for certiorari under Rule 65 is proper if a tribunal, a board or
an officer exercising judicial or quasi-judicial functions has acted
without or in excess of jurisdiction or with grave abuse of discretion
amounting to lack or excess of jurisdiction and there is no appeal, or
any plain, speedy and adequate remedy in the ordinary course of
law.21 In this case, petitioner had the remedy of appeal, and it was the
speedy and adequate remedy in the ordinary course of law. Thus, a
special civil action for certiorari cannot be used as a substitute for an
appeal that the petitioner has already lost. Certiorari cannot be allowed
when a party to a case fails to appeal a judgment to the proper forum
despite the availability of that remedy, certiorari not being a substitute
for a lost appeal.22 Certiorari will not be a cure for failure to timely file a
petition for review on certiorari under Rule 45.23
While there are instances where the extraordinary remedy of certiorari
may be resorted to despite the availability of an appeal, the long line of
decisions denying the special civil action for certiorari, either before
appeal was availed of or in instances where the appeal period had
lapsed, far outnumber the instances where certiorari was given due
course.24 The few significant exceptions are: (1) when public welfare
and the advancement of public policy dictate; (2) when the broader
interests of justice so require; (3) when the writs issued are null; (4)
when the questioned order amounts to an oppressive exercise of
judicial authority,25 which we find to be not present in this case.
Notably, petitioner did not even fail to advance an explanation why
appeal was not availed of, nor was there any showing that the issue
raised in the petition for certiorari could not be raised on appeal.
Concomitant to a liberal application of the rules of procedure should be
an effort on the part of the party invoking liberality to adequately
explain his failure to abide by the rules.26
In fact, the argument raised by petitioner, i.e., that the Court of Appeals
had no legal authority to vary the findings of the trial court and
substitute its own conclusion, which were patently contrary to the trial
court's findings, and conclusion, relates to the wisdom and soundness
of the assailed CA decision and resolution. Where the issue or
question involved affects the wisdom or legal soundness of the
decision - not the jurisdiction of the court to render said decision - the
same is beyond the province of a special civil action
for certiorari.27Erroneous findings and conclusions do not render the
appellate' court vulnerable to the corrective writ of certiorari, for where
the court has jurisdiction over the case, even if its findings are not
correct, these would, at the most, constitute errors of law and not
abuse of discretion correctible by certiorari.28 For if every error
committed by the trial court or quasi-judicial agency were to be the
proper subject of review by certiorari, then trial-would never end, and
the dockets of appellate courts would be clogged beyond measure. 29
Even if we consider this petition for certiorari under Rule 65, it must be
shown that the CA committed grave abuse of discretion equivalent to
lack or excess of jurisdiction, and not mere errors of judgment, for the
petition to be granted.30 As we said, certiorari is not a remedy for errors
of judgment, which are correctible by appeal. By grave abuse of
discretion is meant such capricious and whimsical exercise of
judgment as is equivalent to lack of jurisdiction, and mere abuse of
31
Petitioner contends that the adverse claim of respondent Garcia
inscribed on the title of the subject property is but a notice that the
latter has an interest adverse to respondent Brua's title, to the extent of
P150,000.00 secured by a real estate mortgage, and such adverse
claim cannot be considered superior to that of a final sale conducted
by the sheriff by virtue of a court judgment that has attained finality.
Sec. 12, Rule 39 of the Rules of Court provides:
SEC. 12. Effect of levy on execution as to third persons. - The levy on
execution shall create a lien in favor of the judgment obligee over the
right, title and interest of the judgment obligor in such property at the
time of the levy, subject to liens and encumbrances then existing.
Clearly, the levy does not make the judgment creditor the owner of the
property levied upon. He merely obtains a lien.32 Such levy on
execution is subject and subordinate to all valid claims and liens
existing against the property at the time the execution lien attached,
such as real estate mortgages.33
Respondent Garcia's adverse claim, which refers to the deed of
mortgage executed by respondent Brua in his favor, was annotated on
respondent Brua's title registered with the Registry of Deeds of Rizal
on June 23, 1980 as Entry No. 49853. The adverse claim was already
existing when the Notice of Levy on Execution, as well as the
Certificate of Sale in favor of petitioner, was inscribed on July 11, 1988
and September 2, 1988, respectively; and, hence, the adverse claim is
sufficient to constitute constructive notice to petitioner regarding the
subject property. When petitioner registered her Notice of Levy on
Execution on the title of the subject property, she was charged with the
knowledge that the subject property sought to be levied upon on
execution was encumbered by an interest the same as or better than
that of the registered owner thereof.34 Thus, no grave abuse of
discretion was committed by the CA when it held that the notice of levy
and subsequent sale of the subject property could not prevail over
respondent Garcia's existing adverse claim inscribed on respondent
Brua's certificate of title.
The annotation of an adverse claim is a measure designed to protect
the interest of a person over a piece of real property, where the
registration of such interest or right is not otherwise provided for by the
Land Registration Act or Act No. 496 (now RD. No. 1529 or the
Property Registration Decree), and serves a warning to third parties
dealing with said property that someone is claiming an interest on the
same or a better right than that of the registered owner thereof. 35
Petitioner cannot be considered as a buyer in good faith. A purchaser
in good faith and for value is one who buys the property of another
without notice that some other person has a right to or interest in such
property and pays a frill and fair price for the same at the time of such
purchase, or before he has notice of the claims or interest of some
other person in the property.36 Here, petitioner admitted on cross-
examination that when she registered her notice of attachment in 1981
and the levy on execution on July 11, 1988, she already saw
respondent Garcia's adverse claim inscribed on respondent Brua's title
on June 23, 1980.37
Petitioner claims that Sajonas v. CA38 is not applicable, since the
adverse claim registered on the title of the subject property made by
the Sajonases in 1984 was by virtue of a contract to sell, so that when
the full purchase price was eventually paid on September 4, 1984, a
deed of sale of the property was subsequently executed and registered
in the Registry of Deeds of Marikina on August 28, 1985; that when the
respondent therein registered his notice levy on execution on February
12, 1985, such notice of levy could not have precedence over the
adverse claim, because there was no more property to levy upon. In
this case, however, respondent Garcia caused the annotation of his
adverse claim only as a mortgagee of respondent Brua in the amount
of P150,000.00 in 1980. The subsequent deed of sale was executed in
1991 between respondents Garcia and Brua after the former paid the
latter's loan from with the GSIS. When a new title was issued in
respondent Garcia's name, the notice of levy on execution and the
certificate of sale were already annotated on the title of the subject
property; and, thus, the sale in favor of respondent Garcia could not
prevail over the previous auction sale in petitioner's favor.
We are not impressed.
The issue posed in Sajonas was whether the adverse claim inscribed
on TCT No. N-190417 was still in force when private respondent
therein caused the annotation of the notice of levy on execution on the
title; if the adverse claim was still in effect, then respondent therein was
charged with the knowledge of pre-existing interest over the subject
property and, thus, the Sajonases were entitled to the cancellation of
the notice of levy inscribed on the title.
We ruled in Sajonas that the inscription of the adverse claim on the title
of the subject property was still in effect on February 12, 1985, when
the sheriff annotated the notice of levy on execution in favor of
respondent therein; that respondent therein was charged with
knowledge that the subject property sought to be levied upon on
execution was encumbered by an interest the same as or better than
that of the registered owner thereof. We then said that such notice of
levy could not prevail over the existing adverse claim inscribed on the
certificate of title in favor of the Sajonases.
As in that case, the adverse claim of respondent Garcia based on the
Deed of Mortgage executed by respondent Brua over the subject land
in the former's favor was existing when the Notice of Levy on
Execution was inscribed in favor of petitioner. Although the deed of
sale between respondents Brua and Garcia was done after the notice
of levy on execution and certificate of sale were inscribed on the title, it
was clearly stated in the deed that the subject property was only a
partial payment for respondent Brua's mortgage indebtedness to
respondent Garcia, which the former could no longer redeem from the
latter. Thus, the sale of the subject property by respondent Brua to
respondent Garcia was by reason of respondent Brua's prior loan from
respondent Garcia, which was secured by a mortgage on the subject
property; and this mortgage was registered and already existing on the
title of the subject property when the Notice of Levy on Execution and
Certificate of Sale in favor of petitioner were inscribed thereon. Thus,
petitioner's claim over the subject property must yield to the earlier
encumbrance registered by respondent Garcia.
WHEREFORE, the petition is DISMISSED. The Decision dated August
12, 2004 and Resolution dated November 18, 2004 of the Court of
Appeals in CA-G.R. CV No. 61591 are AFFIRMED.
SO ORDERED.
ENFORCEMENT OF LIENS ON REGISTERED LAND AND
APPLICATION OF NEW CERTIFICATE UPON EXPIRATION OF
REDEMPTION PERIOD
ESTANISLAO PADILLA, JR., Petitioner,
vs.
ASSOCIATION, INC., Respondent.
DECISION
CORONA, J.:
In implementing the involuntary transfer of title of real property levied
and sold on execution, is it enough for the executing party to file a
motion with the court which rendered judgment, or does he need to file
a separate action with the Regional Trial Court?
This is a petition for review on certiorari1 from a decision
of the Court of Appeals in CA-G.R. CV No. 53085,2 and its resolution
denying reconsideration,3 both of which affirmed the orders of the
Regional Trial Court of Bacolod City, Branch 51.4
5
The undisputed facts of the case follow.
Petitioner and his wife are the registered owners of the following real
properties: Lot Nos. 2904-A (covered by TCT No. T-36090), 2312-C-5
(covered by TCT No. T-3849), and 2654 (covered by TCT No. T-8053),
all situated in Bago City.
Respondent is a marketing cooperative which had a money claim
against petitioner.
On April 24, 1987, respondent filed a civil case against petitioner for
collection of a sum of money in the Regional Trial Court of Bacolod
City.6 Despite receipt of summons on May 18, 1987, petitioner (then
defendant) opted not to file an answer.7 On March 3, 1988, respondent
(then plaintiff) moved to have petitioner-defendant declared in default,
which the trial court granted on April 15, 1988.8 Respondent presented
its evidence on October 9, 1989.9On November 28, 1989, the trial court
vor.10 Petitioner was furnished a
copy of this decision by mail on November 29, 1989 but, because of
his failure to claim it, the copy was returned.11
On May 31, 1990, the Court issued a writ of execution. On June 4,
1990, the three lots (Lot 2904-A, Lot 2312-C-5 and Lot 2654), all of the
Bago Cadastre and registered
virtue of that writ. On July 4, 1990, sheriff Renato T. Arimas auctioned
off the lots to satisfy the judgment, with respondent as the only bidder.
On July 10, 1990, ex-officio provincial sheriff and clerk of court Antonio
Arbis executed a certificate of sale in favor of respondent. On August
13, 1990, the certificate of sale was recorded in the Register of
Deeds.12
When petitioner failed to exercise his right of redemption within the 12-
month period allowed by law, the court, on motion of respondent,
ordered on February 5, 1992 the issuance of a writ of possession for
the sheriff to cause the delivery of the physical possession of the
properties in favor of respondent.13
On May 17, 1995, respondent filed a motion to direct the Register of
Deeds to issue new titles over the properties in its name, alleging that
the Register of Deeds (RD) of Bago City would not issue new titles (in
to him. Respondent countered that such surrender was impossible
because this was an inv
petitioner.14
On July 3, 1995, the trial court issued an order granting the motion. In
a subsequent order dated
for reconsideration. Petitioner appealed. Four years later, the Court of
Appeals rendered the assailed decision affirming the order of the trial
court.
cancel the
existing certificates of title and issue new ones in its name was in fact a
real action and that the motion was procedurally infirm because
respondent did not furnish him a copy.15 He also claims that under
Section 6 of Rule 39 of the 1997 Rules of Civil Procedure, the
execution of the judgment was barred by prescription, given that the
motion was filed more than 5 years after the writ of execution was
issued on March 23, 1990.16 He also argues that respondent failed to
follow the correct procedure for the cancellation of a certificate of title
and the issuance of a new one, which is contained in Section 107 of
PD 1529.17
In its comment,18 respondent claims that the motion dated May 15,
1995 to direct the RD to issue new certificates of title was but a
continuation of the series of events that began with the decision in its
favor on November 28, 1989, and from there, the auction of the
properties and the issuance of a certificate of sale in 1990.
The two principal issues for consideration are:
name is now barred by prescription and
(2) whether or not the motion in question is the proper remedy for
name.
court for the issuance of new certificates of title has not yet prescribed.
In Heirs of Blancaflor vs. Court of Appeals,19 Sarmiento Trading
Corporation, predecessor-in-interest of the private respondent Greater
Manila Equipment Marketing Corporation, secured a writ of execution
in 1968 by virtue of which it levied real property belonging to
-in-interest, Blancaflor. When the property was
auctioned, Sarmiento Trading bid successfully and, in 1970, after the
lapse of the one-year redemption period, consolidated its ownership
over the lot.
Sarmiento Trading then filed a petition with the Court of First Instance
one in its name. In 1972, Sarmiento Trading sold the lot to private
respondent which, at the time, went by the name Sarmiento
Distributors Corporation.
In 1988, the Deputy Register of Deeds of Iloilo wrote to Blancaflor
duplicate copy of the TCT.
Blancaflor did not comply and the RD refused to issue a new title. On
May 25, 1989, private respondent filed a petition in the Regional Trial
duplicate copy of the title. The petitioners refused, claiming that
we stated:
It is settled that execution is enforced by the fact of levy and sale.
The result of such execution sale with Sarmiento Trading Corporation
as the highest bidder was that title to Lot No. 22 of TCT No. 14749
vested immediately in the purchaser subject only to the judgment
Therefore, upon Sarmiento Trading
 red by TCT No. 14749 at
-in-interest had
acquired a right over said title.
The right acquired by the purchaser at an execution sale is inchoate
and does not become absolute until after the expiration of the
redemption period without the right of redemption having been
exercised. But inchoate though it be, it is like any other right, entitled to
protection and must be respected until extinguished by
redemption. Gaudencio Blancaflor was not able to redeem his
property after the expiration of the redemption period, which was
12 months after the entry or annotation of the certificate of sale
made on the back of TCT No. 14749. Consequently, he had been
divested of all his rights to the property. (underscoring ours)
In this case, the rule being invoked by petitioner 20 states:
SEC. 6. Execution by motion or by independent action. A final and
executory judgment or order may be executed on motion within five (5)
years from the date of its entry. After the lapse of such time, and
before it is barred by the statute of limitations, a judgment may be
enforced by action. The revived judgment may also be enforced by
motion within five (5) years from the date of its entry and thereafter by
action before it is barred by the statute of limitations.
As should be evident from Blancaflor
Section 6 of Rule 39 of the 1997 Revised Rules of Civil Procedure is
misplaced. The fact of levy and sale constitutes execution, and not the
action for the issuance of a new title. Here, because the levy and sale
of the properties took place in June and July of 1990, respectively, or
less than a year after the decision became final and executory, the
respondent clearly exercised its rights in timely fashion.
In addition, petitioner himself admits his failure to redeem the
properties within the one-year period by adopting the facts stated in the
Court of Ap 21
There is thus no doubt he had been
divested of his ownership of the contested lots.
redeem the
properties 12 months after the certificate of sale was recorded in the
Register of Deeds on August 13, 1990. There is no uncertainty about
question by virtue of the levy and the execution sale.
On the other hand, the issue of whether to acquire new titles by mere
motion or through a separate petition is an entirely different matter.
mere motion for the cancellation of the old TCTs and the issuance of
duplicate TCTs.
Indeed, this called for a separate cadastral action initiated via petition.
Section 107 of PD 1529,22 formerly Section 111 of Act 496,23 provides:
Sec. 107. Surrender of withheld duplicate certificates. Where it is
necessary to issue a new certificate of title pursuant to any involuntary
instrument which divests the title of the registered owner against his
consent or where a voluntary instrument cannot be registered by
reason of the refusal or f
duplicate certificate of title, the party in interest may file a petition in
court to compel the surrender of the same to the Register of Deeds.
The court, after hearing, may order the registered owner or any person
withholding the duplicate certificate to surrender the same, and direct
the entry of a new certificate or memorandum upon such surrender. If
the person withholding the duplicate certificate is not amenable to the
process of the court, or if for any r
duplicate certificate cannot be delivered, the court may order the
annulment of the same as well as the issuance of a new certificate of
title in lieu thereof. Such new certificate and all duplicates thereof shall
contain a memorandum of the annulment of the outstanding duplicate.
Respondent alleges that it resorted to filing the contested motion
because it could not obtain new certificates of title, considering that
his
contention is incorrect. The proper course of action was to file a
petition in court, rather than merely move, for the issuance of new
titles. This was the procedure followed in Blancaflor by Sarmiento
Trading which was in more or less the same situation as the
respondent in this case:24
instance. It was proper for Sarmiento Trading Corporation to file a
petition with the Court of First Instance of Iloilo, acting as a
cadastral court, for the cancellation of TCT No. 14749 in the name of
Gaudencio Blancaflor and the issuance of another in its name. This is
a procedure provided for under Section 78 of Act No. 496 and Section
Section 78 of Act 496 reads:
Sec. 78. Upon the expiration of the time, if any allowed by law for
redemption after registered land has been sold on any execution, or
taken or sold for the enforcement of any lien of any description, the
person claiming under the execution or under any deed or other
instrument made in the course of the proceedings to levy such
execution or enforce any lien, may petition the court for the entry of a
new certificate to him, and the application may be granted: Provided,
however, That every new certificate entered under this section shall
contain a memorandum of the nature of the proceeding on which it is
based: Provided, further, That at any time prior to the entry of a new
certificate the registered owner may pursue all his lawful remedies to
impeach or annul proceedings under execution or to enforce liens of
any description.
Section 75 of PD 1529 provides:
Sec. 75. Application for new certificate upon expiration of redemption
period. Upon the expiration of the time, if any, allowed by law for
redemption after the registered land has been sold on execution, or
taken or sold for the enforcement of a lien of any description, except a
mortgage lien, the purchaser at such sale or anyone claiming under
him may petition the court for the entry of a new certificate to him.
Before the entry of a new certificate of title, the registered owner may
pursue all legal and equitable remedies to impeach or annul such
proceedings.
It is clear tha
The reasons behind the law make a lot of sense; it provides due
process to a registered landowner (in this case the petitioner) and
prevents the fraudulent or mistaken conveyance of land, the value of
which may exceed the judgment obligation. Petitioner contends that
only his interest in the subject lots, and not that of his wife who was not
a party to the suit, should have been subjected to execution, and he
should have had the opportunity to prove as much.
While we certainly will not condone any attempt by petitioner to
frustrate the ends of justice― the only way to describe his refusal to
final and executory judgment against him ― respondent, on the other
hand, cannot simply disregard proper procedure for the issuance to it
of new certificates of title. There was a law on the matter and
respondent should have followed it.
In any event, respondent can still file the proper petition with the
cadastral court for the issuance of new titles in its name.
WHEREFORE, the instant petition is hereby GRANTED. The decision
of the Court of Appeals in CA-G.R. CV No. 53085 is
hereby REVERSED. The order of the Regional Trial Court of Bacolod
City ordering the Register of Deeds of Bago City to issue new
certificates of title in favor of respondent is ANULLED.
SO ORDERED.
RUBEN C. REYES, Petitioner,
vs.
TANG SOAT ING (JOANNA TANG) and ANDO G. SY, Respondents.
DECISION
PEREZ, J.:
Challenged in this petition for review on certiorari under Rule 45 of the
Rules of Court is the Decision1 of the Court of Appeals in CA-G.R. SP
No. 96913 annulling and setting aside the Orders 2 of the Regional Trial
Court (RTC), Branch 7, Malolos, Bulacan which denied respondents
the sale of the property covered by TCT No. 198753) dated May 23,
2006.
The controversy arose from a complaint for Enforcement of Easement
and Damages with Prayer for Preliminary Injunction and Restraining
Order filed by MFR Farms, Inc. (MFR) against respondents docketed
as Civil Case No. 1245-
commercial and industrial use of their property covered by Transfer
Certificate of Title (TCT) No. T-198753, and sought the enforcement of
the encumbrance contained in their title. MFR likewise asked for the
payment of damages suffered by its pig farm resulting from
x x x [Respondents] have defied the clear undertaking stated in the title
to the subject property to limit the use thereof to purposes not
commercial or industrial in character. x x x [U]sing the land as a
chemical processing site and as a storage facility for chemicals is
devoting it to industrial purposes, which is not allowed under the
subsisting encumbrance on the property.
x x x [R]elief is owing to [MFR], but the grant thereof is rendered all the
more imperative in light of the manifestly injurious effects which the
business of [respondents] is causing to the neighboring estate, if not to
the entire locality. x x x By more than mere preponderance of evidence
has it been established that the gaseous by-products of the chemical
manufacturing process are outright pollutants which cause direct and
manifest harm to humans and animals alike, not to mention other living
things.
xxxx
WHEREFORE, judgment is hereby rendered: (a) ordering
[respondents] to desist from the further conduct of industrial or
commercial activities on the parcel of land covered by TCT No. T-
198753 of the Registry of Deeds of Bulacan, particularly the
manufacture and storage of chemicals thereat, including the
construction of buildings intended for purposes prohibited by the title to
the property; (b) making permanent the injunctions issued by this
Co
[respondents] to pay [MFR] actual damages in the amount of Six
hundred Thirty-Nine Thousand Six hundred Fifty (₱639,650.00) Pesos,
with legal rate of Twelve (12%) percent interest from the filing of the
complaint on January 15, 1982, until the same is fully paid; (d) ordering
[respondents] to pay [MFR] exemplary damages in the amount One
Hundred Thousand (₱100,000.00) Pesos by way of example of
correction for the public good; (e) ordering [respondents] to pay MFR
attorney s fees in the amount of One Hundred Thousand
(₱100,000.00) Pesos and to pay the costs of suit.3
On appeal by respondents docketed as CA G.R. CV No. 37808, the
Court of Appeals affirmed with modification the ruling of the RTC: the
Court of Appeals reduced the rate of interest to six percent (6%) and
4
MFR and respondents filed separate appeals by certiorari5 to this Court
we dismissed both appeals for "late payment of legal fees and late
filing of the petition."6 By December 1, 1997, the decision of the Court
of Appeals in CA G.R. CV No. 37808 became final and executory, and
was recorded in the Book of Entries of Judgment.7
On September 28, 1998, upon motion of MFR, the RTC issued a Writ
of Execution.8 Pursuant thereto, the Branch Clerk of Court commanded
the Sheriff of RTC, Branch 7, Malolos, Bulacan, Mr. Leovino Legaspi
(Sheriff Legaspi), to execute the Decision dated September 12, 1991
as modified by the Court of Appeals.9 Sheriff Legaspi was likewise
ordered to accomplish a return of the proceedings taken thereon in
accordance with Section 14, Rule 39 of the Rules of Court.
manifesting:
That on October 2, 1998[,] the undersigned was in receipt of the Writ of
Execution issued by Hon. Danilo A. Manalastas for service thereof;
That on October 9, 1998[,] the undersigned served copy of the Writ of
Execution and copy of the Notice dated October 9, 1998 to
[respondent] Tang Soat Ing giving him five (5) days to comply [with] his
obligations under the Writ of Execution, thru Rodolfo Mendez,
caretaker of the [respondents], at Tungkong Mangga, San Jose del
Monte, Bulacan. The undersigned inquired from the said caretaker
about the personal properties of Tang Soat Ing but he was told that
Tang Soat Ing has no more properties and the factory located in the
compound is being leased to other people;
That on December 10, 1998[,] the undersigned went back to Tang
Soat Ing at Tungkong Mangga, Sa Jose del Monte, Bulacan but said
person was not there and also Rodolfo Mendez was not around
because he was in Manila;
That on December 28, 1998[,] the undersigned went back to Tungkong
Mangga, San Jose del Monte, Bulacan and talked to the caretaker[,]
Rodolfo Mendez[,] and asked him what happened to the papers he
gave to [respondent] Tang Soat Ing. The caretaker said that
[respondent Tang Soat Ing] called his lawyer and informed [the latter]
about the papers he received. The caretaker also told the undersigned
that he [did] not know what the lawyer said.10
A few days thereafter, on January 7, 1999, Sheriff Legaspi presented
the Writ of Execution and the Notice of Levy on Execution of Real
Property11 covering TCT No. T-198753 to the Register of Deeds of
Bulacan Province.
On February 4, 1999, the Notice of Levy was inscribed on TCT No. T-
198753.12
On May 7, 1999, Sheriff Legaspi issued a Notice of Sale on Execution
of Real Property13 which he likewise posted on the following places:
(a) The Bulletin Board of Municipal Hall of San Jose del
Monte, Bulacan;
(b) The Bulletin Board of the Church of San Jose del Monte,
Bulacan;
(c) The Bulletin Board of the Chapel of Gaya-gaya, San Jose
del Monte, Bulacan;
(d) The Bulletin Board of the main entrance of the Provincial
Capitol Building of Malolos, Bulacan; and
(e) The Posting Board of the Office of the Ex-Officio Sheriff
located at the back of the Bulwagan ng Katarungan Building,
Malolos, Bulacan.14
On June 12, 19 & 26, 1999, the Notice of Sale on Execution of Real
Property was published in The Times Newsweekly.15
On July 19, 1999, at the public auction of the subject property covered
by TCT No. T-198753, MFR was declared as the highest bidder. On
even date, Sheriff Legaspi issued a Certificate of Sale16 which was
registered with the Register of Deeds of Bulacan Province.
After more than five (5) years, on September 17, 2004, with
respondents failing to exercise their right of redemption, MFR filed a
Motion17 asking the RTC to issue an order directing the Register of
Deeds of Bulacan Province to cancel TCT No. T-198753 in the name
of respondents, and issue a new certificate of title in the name of MFR.
On September 28, 2004, the RTC denied the Motion holding that a
mere motion is not sufficient for the cancellation of a certificate of title.
The RTC ruled that under Section 10718 of Presidential Decree No.
1529, the Property Registration Decree, a petition and a hearing are
required for the issuance of a new certificate of title.
On December 1, 2004, MFR filed a Petition19 in the same case, under
the same docket number, Civil Case No. 1245-M, before the same
execution court. In this new petition, MFR impleaded the Register of
Deeds as additional defendant and prayed for the same reliefs as
those prayed for in their previous motion with an additional prayer for
the issuance of an order directing respondents to immediately
-198753.
On three separate occasions, December 9, 2004 and February 8 and
17, 2005, respondents, through their counsel of record, Atty. T. J.
Sumawang (Atty. Sumawang), received a copy of the Petition. 20
Respondents failed to file an Answer or any responsive pleading to
R moved to declare respondents in
default. The Motion to Declare Respondents in Default was served on
Atty. Sumawang on June 11, 2005.
thereafter, MFR presented evidence ex-parte.
During presentation of evidence ex-parte, MFR filed a Motion for
Substitution of Party Petitioner attaching thereto a Deed of Transfer of
he RTC
issued an Order granting this latest motion: MFR was substituted by
Reyes as party-petitioner.
In an Order dated January 10, 2006, the RTC granted the Petition,
thus:
WHEREFORE, finding merit in the instant petition, the same is hereby
granted. Accordingly, defendant/private respondent Tang Soat Ing
(Joanna Tang) is hereby directed to surrender to the Court her
-198753 within thirty (30) days
from receipt of this Order. In [the event said] defendant/private
responde
hereinabove, the Register of Deeds of Bulacan is hereby directed to
cancel TCT No. T-
duplicate certificate of title in the name of Ruben C. Reyes, who has
substituted [MFR] by virtue of a Deed of Transfer of Interest and
pursuant to the order of this court dated January 02, 2006. 21
Copies of the Order were separately served on Atty. Sumawang, Atty.
Province on January 20 and February 2, 2006,
respectively.22
returned and rendered impossible. Apparently, Atty. Sumawang had
already died in December 2005.23
On April 27, 2006, Reyes filed another Motion praying that the Register
of Deeds of Bulacan Province be directed to cancel TCT No. T-198753
name.
On May 19, 2006, new counsel for respondents entered its
appearance. Forthwith, on May 23, 2006, respondents, through their
new counsel, filed the previously adverted to Opposition and
Motion,24
void the sale of the subject property.
After an exchange of pleadings from the parties, the RTC issued the
The RTC ruled that, "Section 107 of PD 1529 does not categorically
state that the petition x x x should be in the form of a separate, distinct
and original action to be filed in another court, as otherwise it will
create a situation in which the final judgment of a court, and its
enforcement, may be subject to a review of, or even reversal by
another court of co-equal jurisdiction."25 As regards the motion to
declare void the execution sale of the subject property covered by TCT
No. T-198753, the RTC noted that "there was substantial compliance
with the requirements of [Section 15, Rule 39 of the Rules of Court
1999, as well as
the publication and posting requirements, extant in the records of this
26
case." In conclusion, the RTC ruled that respondents are estopped
from questioning the proceedings, after keeping silent thereon for a
long time, despite notice thereof.
Respondents filed a Motion for Reconsideration which the RTC denied
in its Order dated October 20, 2006.
Gaining no reprieve from the RTC, respondents filed a petition for
certiorari before the Court of Appeals seeking to: (1) nullify the trial
respectively; and (2) declare void the execution proceedings relating to
the sale of the subject property and the cancellation of TCT No. T-
198753.
In yet another turn of events, the appellate court annulled and set
aside the July 17, 2006 and October 20, 2006 Orders of the RTC:
WHEREFORE, the Petition is GRANTED and the Orders issued on
July 17 and October 20, 2006 are ANNULLED and SET ASIDE. The
public auction sale of the property held on July 19, 1999 is declared
invald and the Certificate of Sale issued by Sheriff Leovino G. Legaspi
on July 19, 1999 in favor of [petitioner Reyes, substituting MFR]
covering the parcel of land embraced in Transfer Certificate of Title No.
T-198753 is likewise declared null and void.27
Aggrieved, Reyes filed a Motion for Reconsideration which resulted in
another exchange of pleadings between the parties. On December 9,
2008, the Court of Appeals denied the motion.
Hence, this impasse with the following issues for our resolution:
1. Whether the execution sale of the subject property
covered by TCT No. T-198753 is void;
2. Proceeding from the validity of the execution sale and the
whether Section 107 of Presidential Decree No. 1529
contemplates the filing of a separate cadastral case before
the RTC acting as a land registration court.
The petition is partially impressed with merit.
In declaring void the execution sale, the appellate court noted that
petitioner did not strictly comply with the requirements of Section 15,
Rule 39 of the Rules of Court. The Court of Appeals relied on our
holding in Villaceran v. Beltejar,28 an administrative case finding therein
respondent Sheriff guilty of simple neglect of duty for failure to strictly
comply with the rules on execution sale. The Court of Appeals ruled
that the deficiencies in the notice of execution sale were substantial
and of such nature as to prevent the court from applying the
presumption of regularity in the performance of official functions by
Sheriff Legaspi at the time of the execution sale. On this score, the
prove that the requirements of the law on execution sale have been
fully complied with.
We disagree.
prove lack of compliance with Section 15, Rule 39 of the Rules of
Court rests on the party claiming lack thereof i.e., respondents.
In Venzon v. Spouses Juan,29 we declared that the judgment debtor,
as herein respondents, alleging lack of compliance with the posting
and publication requirements of the auction sale in accordance with the
rules, is behooved to prove such allegation. We held, thus:
x x x. Whoever asserts a right dependent for its existence upon a
negative, must establish the truth of the negative by a preponderance
of the evidence. This must be the rule, or it must follow that rights, of
which a negative forms an essential element, may be enforced without
negative, upon him is cast the onus probandi, except in cases where
the matter is peculiarly within the knowledge of the adverse party.
It was error, therefore, for the trial court to hold that:
Defendants did not present evidence to rebut the "no notice" allegation
of the plaintiff. Although in the def -trial brief, there
is that general allegation that the auction sale was made in accordance
with law, however, there is no showing in the record that the
requirements with respect to publication/posting of notices were
complied with by the defendants.
Deliberating on the absence of notice, the fact that the plaintiff did not
come to know that Lot 12 was being subjected to an auction sale
proves two things: one, that no notice was posted in the place where
the property is located [and, two, that] there was no auction sale that
took place on March 30, 1992. . . .
Further, the defendants, particularly defendant sheriff, who is the most
competent person to testify that a written notice of sale was made and
posted in accordance with law, was not presented to the witness stand.
to attest to the fact that a written notice of sale was posted before the
property was allegedly sold at public auction. In fact, the record is
silent as (to) where the auction sale was conducted.
By ruling in the foregoing manner, the trial court incorrectly shifted the
posting and publication of the notices is a matter "peculiarly within the
knowledge" of the Deputy Sheriff. However, the trial court did not
acquire jurisdiction over him, as he was not served with summons. At
the time of the filing of the complaint, he was "no longer connected"
with the Caloocan RTC, Branch 126, which issued the writ of
execution. Hence, he could not testify in his own behalf.
x x x [T]he duty imposed by Section [18] (c) is reposed upon the
sheriff, who is charged with the enforcement of the writ. Respondent
spouses had a right to presume that he had regularly performed his
duty. It was not incumbent upon them to present him as a witness for,
in the absence of the sheriff, the burden to prove lack of posting and
publication remained with petitioner.30 (Emphasis supplied)
Respondents made no attempt to meet this burden of evidence, simply
maintaining lack of notice of the entire proceedings (execution and
issuance of a new title over the subject property) before the trial court.
disputable presumption that official duty has been regularly performed
was not overcome by respondents.31 The documents on record lead us
to the inevitable conclusion that respondents had constructive, if not
actual, notice of the execution proceedings from the issuance of the
Writ of Execution, the levy on the subject property,32 its subjection to
execution sale, up to and until the proceedings in the RTC relating to
the issuance of a new certificate of title over the subject property.
Certainly, respondents are precluded from feigning ignorance of MFR
(substituted by Reyes) staking a claim thereon.
There was substantial compliance with Section 15, Rule 39 of the
Rules of Court: the documents in support thereof, i.e., the Certificate of
Posting issued by Sheriff Legaspi and the Affidavit of Publication
executed by the publisher of The Times Newsweekly, appear to be in
order.33 In this case, the purpose of giving notice through posting and
publication under Section 15(c) of the same rule to let the public
know of the sale to the end that the best price or a better bid may be
made possible to minimize prejudice to the judgment debtor was
realized.
of the encumbrance on their property the separate registrations of:
(1) the Notice of Levy on TCT No. T-198753; (2) the Certificate of Sale.
In this jurisdiction, we adhere to the doctrine that registration in a public
registry works as constructive notice to the whole world. 34 Section 51
of Act No. 496, as amended by Section 52 of Presidential Decree No.
1529, provides:
SECTION 52. Constructive notice upon registration. Every
conveyance, mortgage, lease, lien, attachment, order, judgment,
instrument or entry affecting registered land shall, if registered, filed or
entered in the Office of the Register of Deeds for 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.
And, quite undeniably, respondents had constructive notice that their
property is subject of execution proceedings arising from their
judgment debt and in danger of forfeiture to their judgment creditor.
Respondents consistently flouted the judgment in Civil Case No. 1245-
M, as amended by the Decision of the Court of Appeals in CA G.R. CV
No. 37808, which became final and executory on December 1, 1997,
by their utter failure to respond to the processes of the RTC in the
execution proceedings despite their receipt of notice at each stage
ttack on the validity of the
execution proceedings, culminating in the execution sale of the subject
property, is barred by laches.
Laches is the failure or neglect, for an unreasonable and unexplained
length of time, to do that which by exercising due diligence could or
should have been done earlier; it is negligence or omission to assert a
right within a reasonable time, warranting a presumption that the party
entitled to assert it either has abandoned it or declined to assert
it.35 Laches thus operates as a bar in equity.36
We hearken to the time-honored rule anchored on public policy:
[R]elief will be denied to a litigant whose claim or demand has become
"stale," or who has acquiesced for an unreasonable length of time, or
who has not been vigilant or who has slept on his rights either by
negligence, folly or inattention. In other words, public policy requires,
for peace of society, the discouragement of claims grown stale for non-
assertion; thus laches is an impediment to the assertion or
enforcement of a right which has become, under the circumstances,
inequitable or unfair to permit.37 (Emphasis supplied)
The records bear out that as of October 9, 1998, and on two occasions
thereafter, December 10 & 28, 1998, Sheriff Legaspi served a copy of
the Writ of Execution on respondents, and followed up thereon. With
no action forthcoming from respondents, who are ostensibly evading
payment of their judgment debt, the Sheriff correctly levied on the
subject property. For more than five (5) years from the execution sale
thereof, with respondents not exercising their right of redemption, up to
the filing of a Motion, and subsequently, a Petition for the issuance of a
new certificate of title over the property
made no effort to settle their judgment debt, much less, to ascertain
the status of the execution proceedings against them and the levy on,
and consequent sale of, their property. Truly significant is the fact that
eight (8) years had lapsed, from the time respondents received a copy
of the Writ of Execution in October 1998 until they, through their new
counsel, filed the Opposition and Motion in May 2006, before
respondents were prodded into action.
brazen ploy to forestall and thwart the
execution of a final and executory judgment against them. The death of
their counsel, Atty. Sumawang, and their engagement of a new one,
does not minimize the hard fact that respondents had notice of, not
only the execution proceedings, but also, the proceedings on the
issuance of a new title over the subject property. Yet, respondents did
not act on any of these notices which were duly received by Atty.
ngs,
from the levy on the subject property and sale thereof, is an
afterthought, a last-ditch effort to evade payment of their judgment
debt. Their claim of ignorance of the execution proceedings flies in the
face of the documents on record. This bare-faced claim cannot trump
the disputable presumption that a person takes ordinary care of his
concerns.38 Consequently, respondents are estopped and barred from
assailing the execution proceedings before the RTC.
Time and again, we have held that once a judgment becomes final and
executory, the prevailing party should not be denied the fruits of his
victory by some subterfuge devised by the losing party. 39 We
Finally, after [MFR] had filed the petition in question pursuant to and in
compliance with the order of this court dated September 28, 2004, to
which no answer or any responsive pleading was filed by respondents
or thru their lawyer, as the latter was certainly notified of the
proceedings in said petition, respondents cannot now assail said
proceedings after keeping silent thereon for a long time, and if indeed
there was neglect on the part of their lawyer in informing them of or in
taking part in said proceedings, such negligence of their counsel binds
them as client. There is likewise an evident lack of prudence and due
diligence on the part of the respondents by their failure to inform this
court of the withdrawal of their former counsel for a long period of time,
and they cannot now, by feigning ignorance of the proceedings had in
the petition in question, assail the same thru a new counsel. In other
words, respondents cannot be allowed to keep silent on or refuse to
participate in proceedings that they know were taking place in
connection with a final judgment rendered against them and then
suddenly, after said proceedings were long terminated, come to court
to question the same through a new counsel. The respondents are
clearly in estoppel. Also, the court finds no practical purpose and
benefit in sustaining the theory posited by respondents which, aside
from the reasons advanced earlier, will have no other effect than to
further unduly delay the execution of a judgment that had long
acquired finality.40
xxxx
Respondents are clearly estopped from assailing the proceedings in
question by their failure or refusal to participate therein despite their or
plaintiff to allow respondents to put in issue the validity of said
proceedings at this late stage, thru another counsel, as they are bound
by the action or inaction of their former counsel.41
reliance on Villaceran v. Beltejar42 is misplaced.
Villaceran is an administrative case finding the Sheriff guilty of simple
neglect of duty for failure to strictly comply with the rules on execution
sale. We held therein that there was no substantial compliance by the
Sheriff with Section 15(c), Rule 39 of the Rules of Court. Our
declaration that "[n]o reason exists not to apply the principle in the
extrajudicial foreclosure sales of real property (statutory requirements
of posting and publication must be strictly complied with since non-
compliance could constitute a jurisdictional defect that would invalidate
the sale) to execution sales of real property under Rule 39 of the Rules
of Court"43 is an obiter which should not be definitive of the facts
obtaining herein.
ubborn refusal to
comply with the judgment against them by claiming lack of notice of the
execution proceedings. We reiterate that this claim is belied by the
evidence on record and cannot invalidate the enforcement and
execution of a final and executory judgment of this Court. On the
time the subject property was validly levied upon by the RTC, bars
them from claiming invalidity of the execution proceedings.
Notwithstanding the validity
consolidation of ownership over the subject property upon the lapse of
the redemption period, we hold that Section 107 of Presidential Decree
No. 1529 contemplates the filing of a separate and original action
before the RTC, acting as a land registration court.1avvphi1
Reyes argues that to require him to "file his petition in another court
would unduly divest the RTC of its jurisdiction to enforce its final and
executory decision." Reyes invokes our ruling in Natalia Realty, Inc. v.
Court of Appeals44 where we declared that "jurisdiction of the court to
execute its judgment continues even after the judgment has become
final for the purpose of enforcement of judgment." 45
execution proceedings in this case have been completed and was
terminated upon the execution sale of the subject property. Reyes
already consolidated ownership over the subject property; as owner,
he has a right to have the same registered in his name. This transfer of
title to the subject propert
execution proceedings: the fact of levy and sale constitutes execution,
not so is the action for the issuance of a new title. 46
Indeed, the subsequent filing of a separate and original action for the
execution of the judgment in Civil Case No. 1245-M.
Section 107 of the Property Registration Decree falls under
PETITIONS AND ACTIONS AFTER ORIGINAL REGISTRATION,
Chapter X thereof. The provision reads:
SECTION 107. Surrender of withhold duplicate certificates. Where it
is necessary to issue a new certificate of title pursuant to any
involuntary instrument which divests the title of the registered owner
against his consent or where a voluntary instrument cannot be
registered by reason of the refusal or failure of the holder to surrender
the owner's duplicate certificate of title, the party in interest may file a
petition in court to compel surrender of the same to the Register of
Deeds. The court, after hearing, may order the registered owner or any
person withholding the duplicate certificate to surrender the same, and
direct the entry of a new certificate or memorandum upon such
surrender. If the person withholding the duplicate certificate is not
amenable to the process of the court, or if not any reason the
outstanding owner's duplicate certificate cannot be delivered, the court
may order the annulment of the same as well as the issuance of a new
certificate of title in lieu thereof. Such new certificate and all duplicates
thereof shall contain a memorandum of the annulment of the
outstanding duplicate.
That a succeeding registration of property in anoth
original registration, contemplates a separate original action is
Marketing Association, Inc.47 Answering the question: "In implementing
the involuntary transfer of title of real property levied and sold on
execution, is it enough for the executing party to file a motion with the
court which rendered judgment, or does he need to file a separate
action with the Regional Trial Court," we unequivocally declared, thus:
mere motion for the cancellation of the old TCTs and the issuance of
new ones as a res
duplicate TCTs.
Indeed, this called for a separate cadastral action initiated via petition.
Section 107 of PD 1529, formerly Section 111 of Act 496, provides:
xxxx
Respondent alleges that it resorted to filing the contested motion
because it could not obtain new certificates of title, considering that
contention is incorrect. The proper course of action was to file a
petition in court, rather than merely move, for the issuance of new
titles. This was the procedure followed in Blancaflor by Sarmiento
Trading which was in more or less the same situation as the
respondent in this case:
Petitioners reliance on prescription and laches is unavailing in this
instance. It was proper for Sarmiento Trading Corporation to file a
petition with the Court of First Instance of Iloilo, acting as a
cadastral court, for the cancellation of TCT No. 14749 in the name of
Gaudencio Blancaflor and the issuance of another in its name. This is
a procedure provided for under Section 78 of Act No. 496 and Section
75 of PD No. 1529. . . .
Section 78 of Act 496 reads:
Sec. 78. Upon the expiration of the time, if any allowed by law for
redemption after registered land has been sold on any execution, or
taken or sold for the enforcement of any lien of any description, the
person claiming under the execution or under any deed or other
instrument made in the course of the proceedings to levy such
execution or enforce any lien, may petition the court for the entry of a
new certificate to him, and the application may be granted: Provided,
however, That every new certificate entered under this section shall
contain a memorandum of the nature of the proceeding on which it is
based: Provided, further, That at any time prior to the entry of a new
certificate the registered owner may pursue all his lawful remedies to
impeach or annul proceedings under execution or to enforce liens of
any description.

Section 75 of PD 1529 provides:

Sec. 75. Application for new certificate upon expiration of redemption

period. ─ Upon the expiration of the time, if any, allowed by law for
redemption after the registered land has been sold on execution, or
taken or sold for the enforcement of a lien of any description, except a
mortgage lien, the purchaser at such sale or anyone claiming under
him may petition the court for the entry of a new certificate to him.

Before the entry of a new certificate of title, the registered owner may
pursue all legal and equitable remedies to impeach or annul such
proceedings.

quandary.1avvphi1 The reasons behind the law make a lot of sense; it

provides due process to a registered landowner (in this case the
petitioner) and prevents the fraudulent or mistaken conveyance of
land, the value of which may exceed the judgment obligation. x x x.

While we certainly will not condone any attempt by petitioner to

e his refusal to

hand, cannot simply disregard proper procedure for the issuance to it

of new certificates of title. There was a law on the matter and
respondent should have followed it.

In any event, respondent can still file the proper petition with the
cadastral court for the issuance of new titles in its name. 48 (Emphasis
supplied).

Plainly, Reyes must institute a separate cadastral action initiated via

petition.

WHEREFORE, the petition is PARTLY GRANTED. The Decision of the

Court of Appeals in CA G.R. SP No. 96913 annulling and setting aside
the Orders dated July 17, 2006 and October 20, 2006 issued by the
Regional Trial Court, Branch 7, Malolos, Bulacan in Civil Case No.
1245-M is MODIFIED:

1. The public auction sale of the subject property covered by

TCT No. T-198753 on July 19, 1999 is declared VALID;

2. The Certificate of Sale issued by Sheriff Leovino Legaspi

on July 19, 1999 in favor of MFR Farms, Inc. (substituted by
petitioner Ruben C. Reyes) covering the parcel of land
embraced in Transfer Certificate of Title No. T-198753 is
likewise declared VALID; and

3. The Petition49 dated October 29, 2004 filed by MFR

Farms, Inc. (substituted by Ruben C. Reyes) is DISMISSED
without prejudice to re-filing as a separate original action
pursuant to Section 107 of Presidential Decree No. 1529.

SO ORDERED.