SUBSEQUENT REGISTRATION

Scope of subsequent dealings with registered land:

VOLUNTARY DEALINGS:

Voluntary dealings refer to deeds, instruments or documents which are the results of the free and
voluntary acts of the parties

Among such voluntary dealings are:

• Sales;

• conveyances or transfers of ownership over the titled property;

• mortgages and leases;

• powers of attorney; and

• Trusts

SEC. 51. Conveyance and other dealings by registered owner. — An owner of registered
land may convey, mortgage, lease, charge or otherwise deal with the same in accordance
with existing laws. He may use such forms of deeds, mortgages, leases or other voluntary
instruments as are sufficient in law. But no deed, mortgage, lease, or other voluntary
instrument, except a will purporting to convey or affect registered land shall take effect
as a conveyance or bind the land, but shall operate only as a contract between the parties
and as evidence of authority to the Register of Deeds to make registration.

The act of registration shall be the operative act to convey or affect the land insofar
as third persons are concerned, and in all cases under this Decree, the registration shall
be made in the office of the Register of Deeds for the province or city where the land lies.

Principles under Sec. 51

1. An owner of registered land may convey, mortgage, lease, charge or otherwise

deal with the same in accordance with existing laws.

2. He may use such forms of deeds, mortgages, leases or other voluntary instruments
as are sufficient in law.

Form is important for validity, convenience and enforceability ;

ie:

a. donation of real property : must be in a public instrument

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 b. Mortgage : the document in which it appears must be recorded in the Registry
of Deeds

c. agreements under the Statute of Frauds: must be in writing and subscribed by

the party charged;

3. The mere execution of deeds of sale, mortgages, leases or other voluntary

documents serves only 2 purposes:

(1) as a contract between the parties thereto; and

(2) as evidence of authority to the Register of Deeds to register such documents.

***The documents by themselves do not effect a conveyance or encumbrance on the

land.

4. It is only the act of registering the instrument in the Register of Deeds for the
province or city where the land lies which is the operative act that conveys
ownership or affects the land insofar as third persons are concerned.

***The act of registration is the operative act to convey or affect the land insofar as third
persons are concerned.

(1) Importance of registration

• verbal agreement of sale cannot be registered;

• serves as protection to an innocent purchaser for value to an innocent lessee,

mortgagee, or other encumbrancer for value.

(2) Registration of document ministerial on the part of the Register of Deeds

• questions regarding the effect or invalidity of instruments are to be decided

after, not before, registration. It must follow as a necessary consequence that
registration must first be allowed, and validity or effect litigated afterwards.

(3) As between the parties, registration is not essential for validity of sale

• actual notice is equivalent to registration;

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 • The purpose of registration is merely to notify the interests of strangers to a
given transaction, who may be ignorant thereof, and the non-registration of
the deed evidencing said transaction does not relieve the parties thereto of
their obligation thereunder”;

• no right of innocent third persons is involved: CONVEYANCE is VALID

NOTE: Actual notice equivalent of registration

Section 51 of the Property Registration Decree provides that, even without the act
of registration, a deed declaring to convey or affect registered land shall operate
as a contract between the parties;

PURPOSE: The registration is intended to protect the buyer against claims of third
persons arising from subsequent alienations by the vendor, and is certainly not
necessary to give effect to the deed of sale, as between the parties to the contract

NOTE: Payment of taxes prerequisite to registration.

RA No. 456, approved June 8, 1950, prohibits the registration of documents

affecting real property which is delinquent in the payment of real estate taxes

SEC. 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.

Principles under Sec. 52

1. Registration is constructive notice to third persons

- contents and all interests, legal and equitable, included in the property;

- Under the rule of notice, it is presumed that the purchaser has examined every
instrument of record affecting the title.

***a supervening claimant cannot claim a better right over land which had been
previously registered in the name of another

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2. Purchaser is not required to explore further than what title indicates for hidden
defects.
- “a person dealing with registered property need not go beyond, but only has to
rely on, the title”
- He is charged with notice only of such burdens and claims which are annotated
on the title, hence
- where there is no cloud or vice in the ownership of the property in the certificate
of title or any encumbrance 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

3. A purchaser who has knowledge of defect of his vendor’s title cannot claim good
faith.

4. When purchaser should investigate.

- when the party concerned has actual knowledge of facts and circumstances that
would impel a reasonably cautious man to make inquiry, that is, the real property
is in actual possession of others

5. Sale of property pending litigation

- Sale is considered to be done in bad faith if the vendees were informed of the
pending litigation, hence they acquire no better right over the same

6. Rule with respect to banks.

- Banks, before approving a loan, shall send representatives to the premises of the
land offered as collateral and investigate who are the true owners thereof;

- Where the bank had exercised the due care demanded of it relative to real estate
loans, it will be considered an innocent mortgagee for value.

7. Estoppel.

- The failure of the purchaser of a parcel of land in execution sale to question on

time the entry or annotation made on the back of the certificate of title, to the effect
that the sale thereof in his favor was subject to redemption within one year from
the registration of said certificate, estops him from claiming that the one-year
period of redemption started earlier

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 8. Voluntary registration

an innocent purchaser for value of registered land becomes the registered owner,
and, the holder of a certificate of title, the moment he:

(a) presents and files a duly notarized and valid deed of sale;

(b) the deed of sale is entered in the day book and at the same time he surrenders or
presents the owner’s duplicate certificate of title covering the land sold; and

(c) pays the registration fees

SEC. 53. Presentation of owner’s duplicate upon entry of new certificate. — No voluntary
instrument shall be registered by the Register of Deeds, unless the owner’s duplicate
certificate is presented with such instrument, except in cases expressly provided for in
this Decree or upon order of the court, for cause shown.

The production of the owner’s duplicate certificate, whenever any voluntary

instrument is presented for registration, shall be conclusive authority from the registered
owner to the Register of Deeds to enter a new certificate or to make a memorandum of
registration in accordance with such instrument, and the new certificate or memorandum
shall be binding upon the registered owner and upon all persons claiming under him, in
favor of every purchaser for value and in good faith.

In all cases of registration procured by fraud, the owner may pursue all his legal
and equitable remedies against the parties to such fraud without prejudice, however, to
the rights of any innocent holder for value of a certificate of title. After the entry of the
decree of registration on the original petition or application, any subsequent registration
procured by the presentation of a forged duplicate certificate of title, or a forged deed or
other instrument, shall be null and void.

Principles under Sec. 53

1. Surrender of owner’s duplicate certificate.

No voluntary instrument shall be registered by the Register of Deeds, unless the

owner’s duplicate certificate is presented with such instrument, except in cases
expressly provided for in this Decree or upon order of the court, for cause shown

To affect the land sold

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 a. Deed of sale must be presented; and
b. its entry in the day book must be done with the surrender of the owner’s
duplicate of the certificate of title

Exemption: in some cases or upon order of the court for cause shown

a. In case of Refusal or failure of the holder to surrender the owner’s duplicate

certificate of title:

Remedy: file a petition in court to compel surrender of the same to the Register of
Deeds (Sec. 107- Surrender of withheld duplicate certificates)

b. Objections on the process; or for 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.

NOTES:

a. The court 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.
b. Non-production of the owner’s duplicate of the certificate of title may not
invalidate a vendee’s claim of ownership.
c. The issuance of a new transfer certificate of title by the Register of Deeds to the
purchaser, without the presentation of the owner’s duplicate, is unwarranted
and confers no right on the purchaser.

2. Innocent holder for value; good faith.

In all cases of registration procured by fraud, the owner may pursue all his
legal and equitable remedies against the parties to such fraud without
prejudice, however, to the rights of any innocent holder for value of a certificate
of title.

PD No. 1529 extends the protection given to an innocent purchaser for

value to an innocent mortgagee

***innocent purchaser for value is one who purchases a titled land by virtue
of a deed executed by the registered owner himself, not by a forged deed

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 ***Where the purchaser has been the victim of impostors pretending to be the
registered owners but who are not said owners and the purchaser acquires
rights over the property, the court cannot disregard such rights and order the
total cancellation of the certificate for that would impair public confidence in
the certificate of title

Purchasers in Good Faith

Good faith consists in the possessor’s belief that the person from whom he
received the thing was the owner of the same and could convey his title

3. A forged deed may the basis of a good title in the hands of a bona fide purchaser.

“the right or lien of an innocent mortgagee for value upon the land mortgaged
must be respected and protected, even if the mortgagor obtained his title through
fraud”

Blondeau v. Nano

The Court explained that the Torrens system permits a forged transfer, when duly
entered in registry, to become the root of a valid title in a bona fide purchaser.

a. Rule when owner is not at fault

Example: case of an invalid mortgage of a parcel of land

-mortgaged without the consent of the owner (Adriano v. Pangilinan)

- “a forged or fraudulent deed is a nullity and conveys no title” (Director of

Lands vs. Addison, 49 Phil. 19)

- where the certificate of title was already transferred from the name of the
true owner to the forger, and while it remained that way, the land was
subsequently sold to an innocent purchaser, then, the vendee had the right
to rely upon what appeared in the certificate (Inquimboy vs. Cruz, G.R. No.
L-13953, July 28, 1960).”

b. Rule in case of double sale

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 GR: in the case of two certificates of title, purporting to include the same
land, the earlier in date prevails, whether the land comprised in the latter
certificate be wholly, or only in part, comprised in the earlier certificate.

In successive registrations:

the person claiming under the prior certificate is entitled to the estate or interest

‘The vendee of the earlier certificate would be the owner as against the vendee of the owner
of the later certificate.’

c. Remedy of aggrieved party

“The purchaser from the owner of the later certificate and his successors, should resort to
his vendor for redress, rather than molest the holder of the first certificate and his
successors, who should be permitted to rest secure in their title.”

4. Mortgagee in good faith..

GR: mortgagor should be the absolute owner of the property to be

mortgaged; otherwise, the mortgage is considered null and void (Article
2085 of the Civil Code)

Exemption:

“Doctrine of mortagee in good faith “

even if the mortgagor is not the owner of the mortgaged property, the mortgage
contract and any foreclosure sale arising therefrom are given effect by reason of
public policy

5. Rule with respect to banking institutions

On the gran t of loan on the security of land, banks must undertake the following:

(a) careful examination of the title of the applicant ; and

(b) physical and on-the-spot investigation of the land itself offered as security

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 Failure to do such ;

a. Banks will be guilty of gross negligence; and

b. cannot be considered as a mortgagee in good faith within the contemplation of

the law

Section 54. Dealings less than ownership, how registered. No new certificate shall be
entered or issued pursuant to any instrument which does not divest the ownership or
title from the owner or from the transferee of the registered owners. All interests in
registered land less than ownership shall be registered by filing with the Register of
Deeds the instrument which creates or transfers or claims such interests and by a brief
memorandum thereof made by the Register of Deeds upon the certificate of title, and
signed by him. A similar memorandum shall also be made on the owner's
duplicate. The cancellation or extinguishment of such interests shall be registered in the
same manner. (Sec. 54 specifies the manner of registration)

Memorandum of encumbrances.

At the dorsal side of a certificate of title is a memorandum of encumbrances affecting

the property. It is here that all interests in registered land less than ownership, like a
mere contract to sell for example, shall be entered by the Register of Deeds. It is not
necessary to issue a new certificate on the basis of an instrument which does not divest
the ownership or title from the owner or from the transferee of the registered owner. A
brief memorandum of the nature of the instrument entered on the certificate of title,
signed by the Register of Deeds, shall serve as notice to third parties of the instrument
affecting the property. A similar entry shall be made on the owner’s duplicate certificate
of title. The cancellation or extinguishments of such interests or rights shall be recorded
in the same manner.

Section 55. Grantee's name, nationality, etc., to be stated. Every deed or other voluntary
instrument presented for registration shall contain or have endorsed upon it the full
name, nationality, residence and postal address of the grantee or other person acquiring
or claiming an interest under such instrument, and every deed shall also state whether
the grantee is married or unmarried, and if married, the name in full of the husband or
wife. If the grantee is a corporation or association, the instrument must contain a recital
to show that such corporation or association is legally qualified to acquire private
lands. Any change in the residence or postal address of such person shall be endorsed
by the Register of Deeds on the original copy of the corresponding certificate of title,

9
upon receiving a sworn statement of such change. All names and addresses shall also be
entered on all certificates.

Notices and processed issued in relation to registered land in pursuance of this

Decree may be served upon any person in interest by mailing the same to the addresses
given, and shall be binding, whether such person resides within or without the
Philippines, but the court may, in its discretion, require further or other notice to be
given in any case, if in its opinion the interest of justice so requires.

Formal Requisites of a Deed (Sec. 55)

1. Full name

2. Nationality

3. Place of residence

4. Postal Address of grantee or other persons acquiring or claiming interest

▪ Importance: notices and processes in relation to registered land are mailed to the
addresses of persons showed in the records

▪ Any change in the residence or postal address of such person shall be endorsed
by the Register of Deeds on the original copy of the corresponding certificate of
title, upon receiving a sworn statement of such change.

1. Civil Status (married or unmarried, and if married, the name in full of the
husband or wife)

2. Where or not corporation or association

▪ If corporation, recital to show that such corporation or association is

legally qualified to acquire private lands

▪ may be expressed in the deed by means of a statement to the effect

that such corp. or assoc. has at least 60% of its capital belonging to
Filipinos

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Section 56. Primary Entry Book; fees; certified copies. Each Register of Deeds shall keep a
primary entry book in which, upon payment of the entry fee, he shall enter, in the order
of their reception, all instruments including copies of writs and processes filed with him
relating to registered land. He shall, as a preliminary process in registration, note in
such book the date, hour and minute of reception of all instruments, in the order in
which they were received. They shall be regarded as registered from the time so noted,
and the memorandum of each instrument, when made on the certificate of title to which
it refers, shall bear the same date: Provided, that the national government as well as
the provincial and city governments shall be exempt from the payment of such fees in
advance in order to be entitled to entry and registration.

Every deed or other instrument, whether voluntary or involuntary, so filed with the
Register of Deeds shall be numbered and indexed and endorsed with a reference to the
proper certificate of title. All records and papers relative to registered land in the office
of the Register of Deeds shall be open to the public in the same manner as court records,
subject to such reasonable regulations as the Register of Deeds, under the direction of
the Commissioner of Land Registration, may prescribe.

All deeds and voluntary instruments shall be presented with their respective copies and
shall be attested and sealed by the Register of Deeds, endorsed with the file number,
and copies may be delivered to the person presenting them.

Certified copies of all instruments filed and registered may also be obtained from the
Register of Deeds upon payment of the prescribed fees.

Upon payment of the entry fee

Register of Deeds to keep a primary entry day book

*ROD shall enter in order of reception all deeds & voluntary instruments, write
& processes regarding the land - year, month , day , time, minute of reception of
instrument;

*provincial and city governments shall be exempt from the payment of such fees

Effect of non-payment of fees

-no registration, annotation or memorandum on a certificate of title shall be made

unless the fees prescribed therefor by this Act are paid within 15 days after the date of
the registration of the deed, instrument or document in the entry book or day book and

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in case said fees are not paid within the time above mentioned, such entry shall be null
and void.

Reckoning point of registration of instruments dealing with registered land

1.) When the instrument is received as noted in the Primary Entry Book and;

2.) When the memorandum of the instrument is later made on the certificate of title to
which it refers

Deeds entered in the day book considered registered from the moment they are so
noted

In the he case of Levin v. Bass the court held that “an innocent purchaser for value of
registered land becomes the registered owner and in the contemplation of law the
holder of a certificate thereof the moment he presents and files duly notarized and
lawful deed of sale and the same entered on the day book…”

Wherein In the case of Fidelity and Surety Co. vs. Conegero, 41 Phil. 396 [1921], the
Supreme Court said that when the land which is the subject of a sale is registered in the
name of the purchaser, registration takes effect retroactively as of the date the deed was
noted in the entry book by the Registrar of Deeds, and not when final registration was
accomplished.

However, the mere filing of a document and its annotation in the primary entry book is
not enough for the purpose of establishing priority, and a third party who in good faith
accepted the same property in a posterior transfer from the registered owner and
secured and presented the owner’s duplicate certificate of title to the Registrar of Deeds,
who completed the registration of such posterior transaction, prevails over the former
both under the law and the broad principle of equity (Vda. de Lazarraga vs. Aclaro, 64
O.G. 35, August 26, 1968, CA).

Record is a constructive notice of its contents

-It is presumed that the purchaser has examined every instrument of record
affecting the title. Purchaser is charged with notice of every fact shown by the record is

12
presumed to know every fact which an examination of the record would have
disclosed.

(A) CONVEYANCES AND TRANSFERS

Section 57. Procedure in registration of conveyances. An owner desiring to convey his

registered land in fee simple shall execute and register a deed of conveyance in a form
sufficient in law. The Register of Deeds shall thereafter make out in the registration
book a new certificate of title to the grantee and shall prepare and deliver to him an
owner's duplicate certificate. The Register of Deeds shall note upon the original and
duplicate certificate the date of transfer, the volume and page of the registration book in
which the new certificate is registered and a reference by number to the last preceding
certificate. The original and the owner's duplicate of the grantor's certificate shall be
stamped "canceled". The deed of conveyance shall be filled and indorsed with the
number and the place of registration of the certificate of title of the land conveyed.

Procedure in registering a deed of conveyance.

An owner who desires to convey the land covered by his title to another shall execute
the proper deed of conveyance, in proper form, and present the same, together with the
owner’s duplicate certificate, to the Register of Deeds for entry and registration. The
Register of Deeds shall enter in the registration book the fact of conveyance and then
prepare a new certificate of title in the name of the grantee, the owner’s duplicate of
which shall be delivered to him The Register of Deeds shall note upon the original and
duplicate certificate the:

(a) date of the conveyance,

(b) volume and page of the registration book in which the new certificate is registered,
and

(c) a reference by number to the last preceding certificate.

The original and owner’s duplicate of the grantor’s certificate shall be stamped
“Cancelled.” The deed of conveyance shall be filed with a notation of the number and
place of registration of the certificate of title of the land conveyed

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SEC. 58. Procedure where conveyance involves portion of land.

Procedural Stages

1) PRIOR TO THE VERIFICATION OF THE PLAN CITING THE SUBDIVIDED

PORTIONS OF LAND:

Where only a portion of land is the subject of conveyance,

a) the Register of Deeds SHALL NOT ISSUE any transfer certificate of title to
the grantee UNTIL the following SHALL HAVE BEEN VERIFIED:

i. a plan of such land showing the portion or portions into which it has been
subdivided
ii. the corresponding technical descriptions in accordance with Sec. 50 of PD
1529

2) PENDING THE VERIFICATION OF THE PLAN CITING THE SUBDIVIDED

PORTIONS OF LAND

a) A deed of conveyance may in the meantime be annotated by way of

memorandum on the grantor’s certificate of title- original and duplicate

• Purpose of such memorandum:

Serve as a notice to third persons of the fact that certain unsegregated
portion of land described therein has been conveyed

• Effect such memorandum:

To show and recognize the grantee’s title to the portion thus conveyed
pending actual issuance to him of the corresponding transfer certificate
of title.

3) UPON THE APPROVAL OF THE PLAN AND TECHNICAL DESCRIPTIONS

CITING THE SUBDIVIDED PORTIONS OF LAND

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a) First, the approved plan- its original and CTC, and the technical
descriptions SHALL BE FILED with the office of the Register of Deeds
for annotation on the corresponding certificate of title

b) Second, the Register of Deeds shall

• ISSUE A NEW TRANSFER CERTIFICATE OF TITLE to the
GRANTEE for the portion conveyed to him and, at the same time,
• CANCEL THE GRANTOR’S CERTIFICATE PARTIALLY with respect
only to portion conveyed

Options by the Grantor:

A) IF THE LAND IS UNSEGREGATED

i. if the grantor so desires,

his certificate of title may be CANCELLED TOTALLY and a new
one issued to him describing therein the remaining portion of the
land

QUALIFYING CONDITION OF THE ABOVE OPTION: No

FURTHER REGISTRATION OR ANNOTATION of any deed or
voluntary instrument involving the unsegregated portion shall be
made by the Register of Deeds pending approval of the plan.

EXCEPTION: where such portion was purchased from the

government or any of
instrumentalities.

or

B) IF THE LAND IS SUBDIVIDED INTO SEVERAL LOTS

ii. if the land has been subdivided into several lots, designated by
numbers and letters, the grantor may request the Register of Deeds
that instead of canceling his certificate of titles and issuing in his
name a new certificate of title for the remaining unconveyed lots,

15
 iii.
• enter on said certificate and on the owner’s duplicate
a MEMORANDUM as to the FACT of:

✓ conveyance of a portion of the land, and

✓ the issuance of a transfer certificate of title for the
portion of land to the grantee, and
✓ the cancellation of the grantor’s certificate insofar as
to the portion of the land concerned

SEC. 59. Carry over of encumbrances in the new certificate

Ministerial duty of the Register of Deeds

Whenever registered land is conveyed:

• The Register of Deeds must guarantee, that at the time of transfer, that ALL
SUBSISTING ENCUMBRANCES OR ANNOTATIONS appearing in the
registration book and noted on the certificate of title shall be

a) carried over and

b) noted on the new certificate of title

• EXCEPTION
▪ Where said encumbrances or annotations are simultaneously released or
discharged

• PURPOSE of carrying over of encumbrances in the new certificate

- to show that the grantee obtained the land or portion thereof subject to
subsisting encumbrances attached to the title of his grantor.

(B) MORTGAGES AND LEASES

SEC. 60. Mortgage or lease of registered land

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A) Mortgage and leases shall be REGISTERED in the manner provided in
Section54 of PD 1529. The owner of registered land may mortgage or lease it by
EXECECUTING THE DEED IN A FORM SUFFICIENT in law

• ESSENCE OF MORTGAGE
Security for
▪ the payment of money or
▪ the fulfillment of an obligation

to answer the amount of indebtedness, IN CASE OF DEFAULT OF

PAYMENT.

• OBJECT OF MORTGAGE

Only the following property may be the object of mortgage:

(a) Immovables;

(b) Alienable real rights in accordance with the laws imposed upon
immovables.

Nevertheless, movables may be the object of a chattel mortgage.

• REQUISITES of mortgage

Article 2085 of the Civil Code

a) constituted to SECURE THE FULFILLMENT OF A PRINCIPAL

OBLIGATION ;
b) MORTGAGOR BE THE ABSOLUTE OWNER of the thing mortgaged

• RATIONALE:
By mortgaging a piece of property, a debtor merely subjects it to lien
but OWNERSHIP thereof is NOT PARTED WITH.

Thus, a mortgage is regarded as nothing more than a mere lien, encumbrance,

or security for a debt, and PASSES NO TITLE OR ESTATE to the mortgagee
and gives him NO RIGHT OR CLAIM TO THE POSSESSION of the property.

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 The mortgagee DOES NOT ACQUIRE TITILE to the mortgaged real estate
unless and until he purchases the same at public auction and the property is
NOT REDEEMED within the PRESCRIBED PERIOD.

• EFFECT IF THE MORTAGOR IS NOT THE ABSOLUTE OWNER:

The mortgage is VOID.

c) MORTAGOR has the FREE DISPOSAL OF HIS PROPERTY and in the

absence thereof, that he be legally authorized for the purpose.

SEC. 61. REGISTRATION.

Registration—operative act to convey or affect the land with regard to third persons

• PROCEDURE:

Upon presentation for registration of the deed of mortgage or lease together

with the owner’s
Duplicate, the Register of Deeds shall ENTER upon the original of
the certificate of title and also upon the owner’s duplicate certificate the
following:

1. A memorandum signed;

2. Date and time of filing;

3. File number assigned to the deed;

4. Reference to the volume and page in the registration book;

• EFFECTS OF REGISTRATION OR NON-REGISTRATION OF

MORTGAGE:

A mortgage, whether registered or not, is BINDING between the

parties, registration being necessary only to make the same valid against
third persons.

Registration only operates as a notice of the mortgage to others, but neither

adds to its validity nor convert an invalid mortgage into a valid one between
the parties.

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 1) RECORDED MORTGAGE IS A RIGHT IN REM

Recording puts the whole world on

✓ CONSTRUCTIVE NOTICE of its existence and
✓ warns everyone who deals thereafter with the property on which it
was constituted that he would have reckon with that encumbrance
2) MORTGAGE IS NEVERTHELESS BINDING BETWEEN THE
PARTIES EVEN IF UNREGISTERED

Article 2125 of the Civil Code provides that in order that a

mortgage may be validly constituted, the document in which it
appears must be recorded in the Registry of Property.

If the instrument is not recorded, the mortgage is nevertheless binding

BETWEEN THE PARTIES. The persons in whose favor the law
establishes a mortgage HAVE NO OTHER RIGHTS than to demand the
execution and the recording of the document in which the mortgage is
formalized.
• EFFECT OF NOTICE OF LIS PENDENS:
A notice of lis pendens is an announcement to the whole world that a particular
real property is in litigation
✓ SERVES AS A WARNING that “one who acquires an interest over the property does
so at his own risk”, so that he gambles on the results of the litigation over said
property

✓ HOWEVER, it has been held that any SUBSEQUENT LIEN OR

ANNOTATION at the back of the certificate of title CANNOT in any way
PREJUDICE THE MORTGAGE previously registered, and the lots subject
thereto pass to the purchaser at a public auction sale free from any lien or
encumbrance

RATIONALE: Otherwise, the value of the mortgage could be easily destroyed

by a subsequent record of an adverse claim, for no one would purchase at a
foreclosure sale if bound by
the posterior claim

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 • UNRECORDED SALE OF A PRIOR DATE VS. RECORDED
MORTGAGE ON A LATER DATE

The unrecorded sale of prior date is PREFERRED over a recorded mortgage on

a later date under Act No. 3344 (Reyes v de Leon, GR No. L-22331)

If the original owner had parted with his ownership of the thing sold then he no
longer had the ownership and free disposal of that thing so as to be able to
mortgage it again.

• RIGHTS OF SECOND MORTGAGEE

El Hogar Filipino v. Philippine National Bank

It was ruled that by PNB’s only right, as second mortgagee are as follows:
✓ Right to repurchase the subject property
✓ apply to the payment of its credit the excess of the proceeds of the
sale after the payment of the credit of El Hogar Filipino, the first
mortgagee.

However, inasmuch as the credit of El Hogar

Filipino, (the first mortgagee) has absorbed the entire proceeds of
the sale, the mortgage in favor of PNB was in fact extinguished
because it cannot be enforced beyond the total value of the lots.

• EFFECT OF MORTGAGE IF TORRENS TITLE IS NULLIFIED

✓ Section 39 of Act No. 496 provides that every person receiving a

certificate of title in pursuance of a decree of registration, and every
subsequent purchaser of registered land who takes a certificates of

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 title for value in good faith, shall hold the same free of all
encumbrance except those noted on said certificate

✓ Blanco v. Esquierdo

Where land covered by a Torrens title was mortgaged to the bank

to secure a loan, but the title was later on nullified since the same
land had been previously titled pursuant a free patent, the
mortgage will not be cancelled where it is shown that the bank
relied on the validity of the title in the name of the mortgagor and,
therefore, acted in good faith.

✓ Penullar v.Philippine National Bank

“Where, however, innocent third persons, relying on the
correctness of the certificate of title thus issued, acquire rights over
the property, the court cannot disregard such rights and order the
total cancellation of the certificate. The effect of such an outright
cancellation would be to impair public confidence in the certificates
of title, for everyone dealing with property registered under the
Torrens System would have to inquire in every instance as to
whether the title has been regularly or irregularly issued by the
court. And this is contrary to the evident purpose of the law.

✓ Gonzales v. Intermediate Appellate Court

Where the Torrens title of the land was in the name of the
mortgagor and later given as security for a bank loan, the
subsequent declaration of said title as null and void is not a
ground for nullifying the mortgage right of the bank, which had
acted in good faith. Being thus an innocent mortgagee for value, its
right or lien upon the land mortgaged must be respected and
protected, even if the mortgagors obtained their title thereto thru
fraud.”

Sec. 62. Discharge or cancellation. A mortgage or lease on registered land may be

discharge or cancelled by means of an instrument executed by the mortgage or lessee
in a form sufficient in law, which shall be filed with the Register of Deeds who shall
make the appropriate memorandum upon the certificate of title.

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 Mortgage is discharged or cancelled only upon full payment of indebtedness. In
case of lease contract, only upon expiration of the lease agreement. This is by means of
an instrument executed by the mortgagee or lessee in a public instrument which shall be
filed with the Register of Deeds who shall make the appropriate memorandum upon the
certificate of title.

Pactum Commisorium- Elements are as follows:

1. There should be a property mortgaged by way of security for the payment of the
principal obligation; and

2. There should be a stipulation for automatic appropriation by the creditor of the thing
mortgaged in case of non-payment if the principal obligation within the stipulated
period.

Any agreement in the nature of Pactum Commisorium is void ab initio, it being contrary
to public policy.

SEC. 63. Foreclosure of Mortgage. — (a) If the mortgage was foreclosed judicially, a
certified copy of the final order of the court confirming the sale shall be registered with
the Register of Deeds. If no right of redemption exists, the certificate of title of the
mortgagor shall be cancelled, and a new certificate issued in the name of the purchaser.

Where the right of redemption exists, the certificate of title of the mortgagor shall not
be cancelled, but the certificate of sale and the order confirming the sale shall be
registered by a brief memorandum thereof made by the Register of Deeds upon the
certificate of title. In the event the property is redeemed, the certificate or deed of
redemption shall be filed with the Register of Deeds, and a brief memorandum thereof
shall be made by the Register of Deeds on the certificate of title of the mortgagor.

If the property is not redeemed, the final deed of sale executed by the Sheriff in favor
of the purchaser at a foreclosure sale shall be registered with the Register of Deeds;
whereupon the title of the mortgagor shall be cancelled, and a new certificate issued
in the name of the purchaser.

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(b) If the mortgage was foreclosed extra-judicially, a certificate of sale executed by the
officer who conducted the sale shall be filed with the Register of Deeds who shall
make a brief memorandum thereof on the certificate of title.

In the event of redemption by the mortgagor, the same rule provided for in the second
paragraph of this section shall apply.

In case of non-redemption, the purchaser at foreclosure sale shall file with the Register
of Deeds, either a final deed of sale executed by the person authorized by virtue of the
power of attorney embodied in the deed of mortgage, or his sworn statement attesting
to the fact of non-redemption; whereupon, the Register of Deeds shall issue a new
certificate in favor of the purchaser after the owner’s duplicate of the certificate has
been previously delivered and cancelled.
A. Foreclosure – the process by which a mortgagee acquires an absolute title to the
property of which he had preciously been only the conditional owner, or upon which he
had previously a mere lien or encumbrance. In case of default of the mortgagor or in the
payment of loan obligations, the mortgagee may foreclose the mortgaged property by
filing a petition for extrajudicial foreclosure of mortgage following the procedure laid
down in A.M. No. 99-10-05-0 (PROCEDURE IN EXTRAJUDICIAL FORECLOSURE OF
MORTGAGE).

B. Remedies in case of default

Three requisites to be in default:
• Obligation is demandable and liquidated.
• Debtor delays in performance.
• Creditor judicially or extrajudicially requires the debtor’s performance.

Where a debt is secured by a mortgage and there is default in payment on the part
of mortgagor, the mortgagee has a choice of on of two remedies, but he cannot have
both.

The mortgagee may:

a. Foreclose the mortgage; or

b. File an ordinary action to collect the debt.

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a. Foreclose the mortgage – The mortgagee enforces his lien by the sale on foreclosure of
the mortgaged property. The proceeds will be applied to the satisfaction of debt. In case
of deficiency, the mortgagee has the right to claim for the deficiency resulting from the
price obtained in the sale of the real property at public auction and the outstanding
obligation at the time of the foreclosure proceedings. In case of surplus, the mortgagor is
entitled thereto.

b. Action to collect debt- Mortgagee will have no more priority over the mortgaged
property. If the judgment in an action to collect is favourable to him, and it becomes final
and executory, he can enforce said judgment and execution. He can even levy execution
on the same mortgaged property.

Options of a secured creditor in case of death of the debtor:

✓ to waive the mortgage and claim the entire debt from the estate of the mortgagor
as an ordinary claim;
✓ To foreclose the mortgage judicially and prove any deficiency as an ordinary
claim; and
✓ To rely on the mortgage exclusively, foreclosing the same at anytime before it is
barred by prescription, without right to file a claim for any deficiency.

Prescription of the action to FORECLOSE

An action to enforce a right arising from a mortgage should be enforced within 10 years
from the time the right of action accrues, from default in payment of the loan
amortizations. Foreclosure made beyond the prescriptive period renders the
proceedings void.

3. Types of Sales
A. Ordinary execution of sale
B. Judicial Foreclosure Sale
C. Extrajudicial Foreclosure Sale

A. Ordinary execution of sale – governed by Rule 39 of Rules of Court on

Execution, Satisfaction and Effect of Judgments.

B. Judicial Foreclosure Sale – governed by Rule 68 of Rules on Foreclosure of

Mortgage.

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Rules on Judicial Foreclosure (Rural Bank of Oroquieta v. Court of Appeals):
a. It is the confirmation by the court of the auction sale that would divest the mortgagors
of their rights to the mortgaged lot and that would vest such rights in the bank as
purchaser at the auction sale.

b. The clause “subject to such rights of redemption as may be allowed by law” found in
the last part of Section 3, has no application to a case where the mortgagor did not exercise
his right of redemption under Section 78 of the General Banking Law.

c. A foreclosure sale is not complete until it is confirmed, and before said confirmation,
the court retains control of the proceedings by exercising a sound discretion in regard to
it, either granting or withholding confirmation as the rights and interests of the parties
and the ends of justice may require.

d. In order that a foreclosure sale may be validly confirmed by the court, it is necessary
that a hearing be given the interested parties, at which they may have an opportunity to
show cause why the sale should not be confirmed.

e. The acceptance of a bid at the foreclosure sale confers no title on the purchaser. Until
the sale has been validly confirmed by the court, he is nothing more than a preferred
bidder. Title vests only when the sale has been validly confirmed by the court.

f. The confirmation retroacts to the date of the sale.

g. A hearing should be held for the confirmation of the sale. The mortgagor should be
notified of that hearing. Lack of notice vitiates the confirmation of the sale. The mortgagor
may still redeem the mortgaged lot after the rendition of the order confirming the sale
which is void for lack of hearing and notice to the mortgagor.

h. Notice and hearing of a motion for confirmation of sale are essential to the validity of
the order of confirmation, not only to enable the interested parties to resist the motion
but also to inform them of the time when their right of redemption is cut off.

i. An order of confirmation, void for lack of notice and hearing, may be set aside anytime.

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j. It is equally settled that after the foreclosure sale but before its confirmation, the court
may grant the judgment debtor or mortgagor an opportunity to pay the proceeds of the
sale and thus refrain from confirming it.

k. If after the foreclosure sale and before the confirmation thereof, the mortgagee, as
purchaser at the auction sale, sold the mortgaged property to another person, that
subsequent sale does not render the foreclosure sale more effective. That subsequent sale
does not prevent the trial court from granting the mortgagor a period within which to
redeem the mortgaged lot by paying the judgment debt and the expenses of the sale and
costs.

l. Whatever may have been the old rule by all of the modern authorities, it is the policy
of the court to assist rather than to defeat the right of redemption.

m. After the confirmation of the sale, made after hearing and with due notice to the
mortgagor, the latter cannot redeem anymore the mortgaged lot (unless the mortgagee is
a banking institution).

n. It is after the confirmation of the sale that the mortgagor loses all interest in the
mortgage property.

Disposition of the proceeds

Section 4 Rule 68 of Rules of Court – amount realized from the foreclosure sale
of the mortgaged property shall, after deducting the cost of sale, be paid to the person
foreclosing the mortgage, and when there shall be any balance or residue, after paying
off the mortgage debt due, the same shall be paid to junior encumbrancers in the order
of their priority, to be ascertained by the court, or if there be no encumbrancers or there
be a balance or residue after payment to them, then to the mortgagor or his duly
authorized agent, or to the person entitled to it.

C. Extrajudicial Foreclosure Sale – governed by Act. No. 3135 as amended by Act. No.
4118 “An Act to Regulate the Sale of Property under Special Powers Inserted in or
Annexed to Real Estate Mortgages.”

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An extrajudicial foreclosure of real estate mortgage is initiated by filing a petition, not
with any court of justice, but with the office of the sheriff of the province or city where
the sale is to be made. And by express mandate of Section 2 of Act No. 3135, as
amended by Act No.4118, “such sale cannot be made legally outside of the province (or
city) in which the property sold is situated.”

Before the sale, Section 3 of said Act No. 3135 requires that:

“Notice shall be given by posting of the sale for not less than twenty days in at least three
public places of the municipality or city where the property is situated, and if such
property is worth more than four hundred pesos, such notice shall be published once
a week for at least three consecutive weeks in a newspaper of general circulation in the
municipality or city.”

Personal notice to the mortgagor is thus not required.

Redemption Period
The law expressly confers to the mortgagor that right to redeem a property extrajudicially
foreclosed. Section 6 of Act No. 3135, as amended by Act 4148. It has been held that said
“right of redemption provided for by the aforequoted provision, like any other
property rights, may be transferred or assigned by its owner. The law “grants to the
mortgagor the right of redemption within one (1) year from the registration of the
sheriff’s certificate of foreclosure sale,” not from the date of auction sale. The option to
exercise such right, is, however, personal to the mortgagor. The latter therefore may
waive to redeem the mortgaged property and let the title thereto vest upon
whoever purchases it in the manner provided by law.

The aforementioned one (1) year period for redemption no longer applies to
juridical persons whose real property has been mortgaged with a bank. Section 47, 2nd
paragraph, of Republic Act No. 8791 (known “The General Banking Law of 2000”)
provides as follows:

“Notwithstanding Act 3135, juridical persons whose property is being sold

pursuant to an extrajudicial foreclosure shall have the right to redeem the property
in accordance with this provision until, but not after, the registration of the
certificate of foreclosure sale with the applicable Register of Deed which in no case
shall be more than three (3) months after foreclosure, whichever is earlier.

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 Owners of property that has been sold in a foreclosure sale prior to the effectivity
of this Act (approved on May 23, 2000 shall retain their redemption rights until
their expiration.”

On the other hand, a mortgagee is deemed to have waived the statutory period for
redemption when he accepts the redemption price from the mortgagor after the
one (1) year for redemption had expired.

During the redemption period, the mortgagor may validly execute a mortgage
contract over the same property in favor of a third party. For the mortgagor
remains as the absolute owner of the property during that period. However, upon
a proper foreclosure of the prior mortgage, all liens subordinate to the first
mortgage are likewise foreclosed, and the purchaser acquires title free from the
subordinate liens. Thereafter, the Register of Deeds, ordinarily, is authorized to
issue new titles without carrying over the annotations of the subordinate liens.

Period of Redemption is not a prescriptive period – the former is a condition

precedent provided by law to restrict the right of the person exercise redemption.

Rules on Judicial Redemption:

a. timely redemption or redemption by expiration date;
b. good faith as always, meaning, the filing of the action must have been for the sole
purpose of determining the redemption price and not to stretch the redemptive period
infinitely; and
c. once the redemption price is determined within a reasonable time, the redemptioner
must make prompt payment in full.

Note: Accepting the redemption price after the statutory period for redemption had
expired constitutes a waiver.

Equity of Redemption and Right of Redemption distinguished

EoR is the right of mortgagor to redeem the mortgaged property after his default in the
performance of the conditions of the mortgage but before the sale of the property or the
confirmation of the sale. RoR means the right of the mortgagor to repurchase the property
even after confirmation of the sale, in cases of foreclosure by banks, within 1 year from
the registration of the sale.

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Who may redeem?
The mortgagor and he who is in privity in title with the mortgagor, and he has such
interest that he would be a loser by the foreclosure.

Confirmation by the court – of the auction sale that divests the mortgagor of his right to
the mortgaged lot and vests such rights in the bank as purchaser at the auction sale.

Redemption where mortgagee is a bank – Sec. 78 of RA No. 337 or General Banking Act,
as amended provides that:

"Sec. 78. Loans against real estate security shall not exceed seventy percent
(70%) of the appraised value of the respective real estate security, plus seventy
percent (70%) of the appraised value of the insured improvements, and such
loans shall not be made unless title to the real estate shall be in the mortgagor.
In the event of foreclosure, whether judicially or extrajudicially, of any
mortgage on real state which is security for any loan granted before the
passage of this Act or under the provisions of this Act, the mortgagor or
debtor whose real property has been sold at public auction, judicially or
extrajudicially, for the full or partial payment of an obligation to any bank,
banking or credit institution, within the purview of this Act shall have the
right, within one year after the sale of the real estate as a result of the
foreclosure of the respective mortgage, to redeem the property by paying the
amount fixed by the court in the order of execution, or the amount due under
the mortgage deed, as the case may be, with interest thereon at the rate
specified in the mortgage, and all the costs, and judicial and other expenses
incurred by the bank or institution concerned by reason of the execution and
sale and as a result of the custody of said property less the income received
from the property. However, the purchaser at the auction sale concerned in a
judicial foreclosure shall have the right to enter upon and take possession of
such property immediately after the date of the confirmation of the auction
sale by the court and administer the same in accordance with law."

Rule where land covered by homestead or free patent is mortgaged to a rural

bank – Mortgagor may redeem the property within 2 years from:
a. the date of foreclosure if the property is not covered by Torrens title, or
b. from the registration of the sheriff’s certificate of sale at such foreclosure
if the property is covered by Torrens title.

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 If mortgagee fails to exercise his right, his heirs may still repurchase the property
within 5 years from the expiration of the two-year redemption period.

Tender of payment; formal offer not essential in case of judicial action

The general rile in redemption is that in making a repurchase, it is not sufficient that a
person offering to redeem makes manifestation of his desire to repurchase; this statement
of intention must be accompanied by an actual and simultaneous tender of payment.

A mere offer to pay, not accompanied or promptly followed by consignation in court

of the amount tendered but refused by the creditor, in bot sufficient to cause
cessation of the running of interest.

Rule on redemption liberally construed

In favor of the original owner of the property. SC has allowed parties in several cases to
perfect their right of redemption even beyond the prescribed period. Example, De los
Reyes vs. IAC, Castillo vs. Nagtalon, Bodiongan vs. CA, and Ajax Marketing &
Development Corporation vs. CA.

Failure to redeem; consolidation of ownership

The buyer in a foreclosure sale becomes the absolute owner of the property purchased if
it is not redeemed during the period of one year after the registration of sale. As such,
he is entitled to the possession of the property and can demand it anytime following the
consolidation of ownership in his name and the issuance of a new transfer certificate of
title.

No actual transfer of mortgaged property until after the expiration of the one-year
redemption period
If no right of redemption exists, the certificate of title of the mortgagor shall be cancelled,
and a new certificate issued in the name of the purchaser. But where the right of
redemption exists the COT of the mortgagor shall not be cancelled but the certificate of
sale and the order confirming the sale shall be registered by a brief memorandum thereof
made by the register of deeds upon the certificate of title.

Liens subordinate to the mortgage

The rights of a subsequent lien holder over the mortgaged property are inferior to that of
the prior mortgagee. A subsequent lien holder acquires only the right of redemption

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vested in the mortgagor, and his rights are strictly subordinate to the superior lien of the
anterior mortgagee.

Writ of Possession
A petition for the issuance of writ of possession under Section 7 of Act No. 3135, as
amended, is not an ordinary civil action by which one party sues another for the
enforcement or protection of a right, or the prevention or redress of a wrong. It is in the
nature of ex parte motion, taken for granted at the issuance and for the benefit of one
party, without need of notice to or consent by any party who might adversely
affected.

A mortgagee who effects the extrajudicial foreclosure of the mortgage, or the

purchaser at the foreclosure sale, is entitled to a writ of possession over the property
foreclosed even before the expiration of the period of redemption, provided that a
proper motion has been filed, a bond approved, and no third person is
involved.

Exceptions:
(1) when a third party is actually holding the property adversely to the judgment debtor;
(2) where the property or properties were found to have been sold at an unusually lower
price than their true value, such as where the properties worth at least P500,000.00 were
sold for only P 57,396.85; and
(3) where a surplus from the proceeds of the sale equivalent to approximately 40% of the
total mortgage debt, which is obviously a substantial amount, has not been paid by the
mortgagee or purchaser to the mortgagor or the person entitled to it.

Any of these circumstances demand that a writ of possession should not issue.

However, if the property is not redeemed within the one-year period after registration of
the sale, he becomes the absolute owner of subject property. “As such, he is entitled to
the possession of the said property and can demand it any time following the
consolidation of ownership in his name and the issuance to him of a new transfer
certificate of title.”

Note: The redemptioner may pay only the purchase price paid by the successful bidder
plus one percent (1%) monthly interest up to the time of redemption.

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Note: Issuance of writ of possession not ministerial where third party is in adverse
possession or is not a privy to the debtor. This exception is found in Section 33, Rule 39
of ROC which provides:
“Upon the expiration of the right of redemption, the purchaser or redemptioner
shall be substituted to and acquire all the rights, title, interest and claim of the judgment
obligor to the property as of the time of the levy. The possession of the property shall be given
to the purchaser or last redemptioner by the same officer unless a third party adversely to the
judgment obligor.”

A third party not privy to the debtor is protected by the law. He may be ejected
from the premises only after he has been given an opportunity to be heard, conformably
with the time-honored principle of due process.

Right of mortgagor and junior encumbrances to surplus proceeds of foreclosure sale

(Sulit v. CA)
Surplus money arising from a sale of land under a decree of foreclosure stands in
the place of the land itself with respect to liens thereon or vested rights thereon. They are
constructively, at least, real property and belong to the mortgagor or his assigns.
Inevitably, the right of a mortgagor to the surplus proceeds is a substantial right which
must prevail over rules of technicality.

Jurisprudence has it that when there are several liens upon the premises, the
surplus money must be applied to their discharge in the order of the of their priority. A
junior mortgagee may have his rights protected by an appropriate decree as to the
application of the surplus, if there be any, after satisfying the prior mortgage. His lien on
the land is transferred to the surplus fund. And a senior mortgagee, realizing more than
the amount of his debt on a foreclosure sale, is regarded as a trustee for the benefit of
junior encumbrances.

Right of the creditor to recover deficiency from proceeds of the sale in extrajudicial
foreclosure
A creditor is allowed to recover the deficiency from the sale of the property in an
extrajudicial foreclosure. Stated otherwise, the creditor is not prohibited from taking
steps to recover any unpaid balance on the principal obligation simply because he chose
to extrajudicially foreclose the real estate mortgage.

Equitable mortgage

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 One which although it lacks some formality, form of words or other requisite
prescribed by a statute, shows the intention of the parties to charge a real property as
security for a debt and contains nothing impossible or contrary to law.

Art. 1602 of the Civil Code states that the contract shall be presumed to be an
equitable mortgage, in any of the following cases:
(1) When the price of a sale with right to repurchase is unusually inadequate;
(2) When the vendor remains in possession as lessee or otherwise;
(3) When upon or after the expiration of the right to repurchase another instrument
extending the period of redemption or granting a new period is executed;
(4) When the purchaser retains for himself a part of the purchase price; and
(5) When the vendor binds himself to pay the taxes on the thing sold;
(6) In any other case where it may be fairly inferred that the real intention of the
parties is that the transaction shall secure the payment of a debt or the performance
of any other obligation.

The existence of any of the circumstances under Art. 1602, not a concurrence nor an
overwhelming number of such circumstances, suffices to give rise to the presumption
that the contract is an equitable mortgage.

(C) POWERS OF ATTORNEY; TRUSTS

Sec. 64. Power of attorney. Any person may, by power of attorney, convey or otherwise
deal with registered land and the same shall be registered with the Register of Deeds
of the province or city where the land lies. Any instrument revoking such power of
attorney shall be registered in like manner.
Special power of attorney refers to a clear mandate (express or implied) specifically
authorizing the performance of an act.

Civil Code provisions requires:

1. That an agent’s authority to sell a piece of land or any interest therein shall be in
writing, otherwise, the sale is void (Art. 1874).

2. That “a special power to sell excludes the power to mortgage; and a special power to
mortgage does not include the power to sell (Art. 1879).

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3. That a special power of attorney is necessary before an agent may “enter into any
contract by which ownership of an immovable is transmitted or acquired either
gratuitously or for a valuable consideration (Art. 1878[5]).

4. Lease any real property to another person for more than one year (Art. 1878[8]).

Sec. 65. Trusts in registered land. If a deed or other instrument is filed in order to
transfer registered land in trust, or upon any equitable condition or limitation
expressed therein, or to create or declare a trust or other equitable interests in such land
without transfer, the particulars of the trust, condition, limitation or other equitable
interest shall not be entered on the certificate; but only a memorandum thereof shall
be entered by the words "in trust", or "upon condition", or other apt words, and by a
reference by number to the instrument authorizing or creating the same. A similar
memorandum shall be made upon the original instrument creating or declaring the
trust or other equitable interest with a reference by number to the certificate of title to
which it relates and to the volume and page in the registration book in which it is
registered.

Trust is a fiduciary relationship with respect to property which involves the existence of
equitable duties imposed upon the holder of the title to the property to deal with it for
the benefit of another.

Trustor – person who establishes a trust

Trustee – one in whom confidence is reposed as regards property for the benefit of
another.
Beneficiary – one who benefits from the trust.

Trust is either:
Express – created by the intention of the trustor.
Implied – comes into being by the operation of law and is either:

a. Constructive trust – a person holding a title to property is subject to an equitable

duty to convey it to another on the ground that he would be unjustly enriched if he
were permitted to retain it. The duty to convey the property arises because it was
acquired through fraud, duress, undue influence or mistake, or trough breach of a
fiduciary duty, or through wrongful disposition of another’s property.

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 b. Resulting trust – arises where a person makes or causes to be made a disposition
of property under circumstances which raise an inference that he does not intend that
the person taking or holding the property should have the beneficial interest in the
property.

Examples of Constructive trust and Resulting trust:

Pepe gives his friend Dede P5,000,000 and asks him to “buy the old Pet’s Bulaluhan place
if it comes on the market.” If Dede buys the property but puts it in his own name, not
hers, a court could impose a trust, ruling that Dede holds the property only for Pepe’s
benefit.

A father might transfer a bank account to his daughter with the understanding that the
funds in the account are to be split among all the man’s children after his death. If the
daughter keeps all the money, her siblings could sue. They would have to come up with
proof of what their father intended and convince the court to declare that the daughter
holds the money in trust for the other siblings.

Co-ownership is a form of trust

Co-ownership is a form of trust and every co-owner is a trustee for the other.
Whether established by law or by agreement of the co-owners, the property or thing held
pro-indiviso is impressed with a fiducial nature that each co-owner becomes a trustee for
the benefit of his co-owners and may not do any act prejudicial to the interest of his co-
owners.

Note: As a rule, implied resulting trusts do not prescribe except when the trustee
repudiates the trust. Further, the action to reconvey does not prescribe so long as the
property stands in the name of the trustee.

No particular form required for the creation of express trust

It is sufficient that a trust is clearly intended. Created by direct and positive acts
evidencing an intention to create a trust. Example, a motion file by the heirs of the
deceased in the proceedings to terminate it since they had the desire to preserve the
properties of the estate in co-ownership, in effect it created an express trust among the
heirs.

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SEC. 66. Trust with power of sale, etc., how expressed. — If the instrument creating or
declaring a trust or other equitable interest contains an express power to sell, mortgage
or deal with the land in any manner, such power shall be stated in the certificate of
title by the words “with power to sell,” or “power to mortgage,” or by apt words of
description in case of other powers. No instrument which transfers, mortgages or in
any way deals with registered land in trust shall be registered, unless the enabling
power thereto is expressly conferred in the trust instrument, or unless a final judgment
or order of a court of competent jurisdiction has construed the instrument in favor of
the power, in which case a certified copy of such judgment or order may be registered.

Trusts, how expressed and registered.

Section 66 states that no instrument which transfers, mortgages or in any way deals with
registered land in trust shall be registered, unless the enabling power thereto is expressly
conferred in the trust instrument, or unless a final judgment or order of a court of
competent jurisdiction has construed the instrument in favor of the power, in which case
a certified copy of such judgment or order may be registered. If the instrument creating
or declaring a trust or other equitable interest contains an express power to sell, mortgage
or deal with the land in any manner, such power shall be stated in the certificate of title
by the words “with power to sell,” or “power to mortgage,” or by apt words of
description in case of other powers.

Difference between a power of sale under a trust and a power of sale under a mortgage

The deed of trust may be foreclosed according to the terms made by the trustee without
the authority of the court. While a power of sale under a mortgage can be foreclosed only
under the decree of court as such certified copy of such judgment or order may be
registered. (El Hogar Filipino v. Paredes, GR No. 19843, Oct.3, 1923)

SEC. 67. Judicial appointment of new trustee. — If a new trustee of registered land is
appointed by a court of competent jurisdiction, a new certificate may be issued to him
upon presentation to the Register of Deeds of a certified copy of the order or judicial
appointment and the surrender for cancellation of the duplicate certificate.

Appointment of trustee.

A trustee necessary to carry into effect the provisions of a will or written instrument shall
be appointed by the Regional Trial Court in which the will was allowed. The executor or
administrator or the person appointed as trustee under the will or written instrument
shall file the petition for the appointment of a trustee in compliance with the wishes of

36
the testator. Under Article 1445 of the Civil Code, “no trust shall fail because the trustee
appointed declines the designation unless the contrary should appear in the instrument
creating the trust.”

Powers, rights and duties of a new trustee.

When a trustee under a written instrument declines, resigns, dies or is removed before
the objects of the trust are accomplished, and no adequate provision is made in such
instrument for supplying the vacancy, the proper Regional Trial Court may, after due
notice to all persons interested, appoint a new trustee to act alone or jointly with others,
as the case may be. Such new trustee shall have and exercise the same powers, rights and
duties as if he had been originally appointed, and the trust estate shall vest in him in like
manner as it had vested or would have vested, in the trustee in whose place he is
substituted; and the court may order such conveyance to be made by the former trustee,
as may be necessary or proper to vest the trust estate in the new trustee, either alone or
jointly with others.

If a new trustee or registered land is appointed by the court, a new certificate may be
issued to him upon presentation to the Register of Deeds of a certified copy of the order
or judicial appointment and the surrender for cancellation of the duplicate certificate.

SEC. 68. Implied trusts, how established. — Whoever claims an interest in registered
land by reason of any implied or constructive trust shall file for registration with the
Register of Deeds a sworn statement thereof containing a description of the land, the
name of the registered owner and a reference to the number of the certificate of title.
Such claim shall not affect the title of a purchaser for value and in good faith before
its registration.

Registration of claim based on implied trust.

For the protection of a person claiming an interest in registered land by reason of any
implied or constructive trust, he should file with the Register of Deeds a sworn statement:

(a) containing the description of the land,

(b) the name of the registered owner, and

(c) a reference to the number of the certificate of title.

Such claim will not affect the right of a purchaser for value and in good faith prior to such
registration.

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 INVOLUNTARY DEALINGS

SEC. 69. Attachments. — An attachment, or a copy of any writ, order or process issued
by a court of record, intended to create or preserve any lien, status, right, or attachment
upon registered land, shall be filed and registered in the Registry of Deeds for the
province or city in which the land lies, and, in addition to the particulars required in
such papers for registration, shall contain a reference to the number of the certificate
of title to be affected and the registered owner or owners thereof, and also if the
attachment, order, process or lien is not claimed on all the land in any certificate of title
a description sufficiently accurate for identification of the land or interest intended to
be affected. A restraining order, injunction or mandamus issued by the court shall be
entered and registered on the certificate of title affected, free of charge.

Nature of attachment.

Attachment is the legal process of seizing another’s property in accordance with a writ or
judicial order for the purpose of securing satisfaction of a judgment yet to be rendered.
The writ of attachment is used primarily to seize the debtor’s property in order to secure
the debt or claim of the creditor in the event that a judgment is rendered.

It has been held that a party who delivers a notice of attachment to the Register of Deeds
and pays the corresponding fees has a right to presume that the official would perform
his duty properly. In involuntary registration, such as an attachment, levy upon
execution, lis pendens and the like, the entry thereof in the day book is a sufficient notice
to all persons of such adverse claim. The notice should, of course, be annotated on the
back of the corresponding original certificate of title, but this is an official duty of the
Register of Deeds which may be presumed to have been regularly performed. As held in
Development Bank of the Philippines v. Acting Register of Deeds of Nueva Ecija, “current
doctrine thus seems to be that entry alone produces the effect of registration, whether the
transaction entered is a voluntary or involuntary one, so long as the registrant has
complied with all that is required of him for purposes of entry and annotation, and
nothing more remains to be done but a duty incumbent solely on the register of deeds.”

Section 69 states that an attachment or any writ, order or process intended to create or
preserve any lien upon registered land shall be filed and registered in the Registry of
Deeds and shall contain a reference to the number of the certificate of title to be affected,
the registered owner thereof and a description of the land or interest therein.

Grounds upon which attachment may issue.

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Section 1, Rule 57 of the Rules of Court provides that at the commencement of the action
or at any time before entry of judgment, a plaintiff or any proper party may have the
property of the adverse party attached as security for the satisfaction of any judgment
that may be recovered in, among others, the following cases:

(c) In an action to recover the possession of property unjustly or fraudulently

taken, detained or converted, when the property, or any part thereof, has been concealed,
removed, or disposed of to prevent its being found or taken by the applicant or an
authorized person;

(d) In action against a party who has been guilty of fraud in contracting the debt
or incurring the obligation upon which the action is brought, or in the performance
thereof; and

(e) In an action against a party who has removed or disposed of his property, or is
about to do so, with intent to defraud his creditors.

A preliminary attachment may be validly applied for and granted ex parte before the
defendant is summoned since the phrase “at the commencement of the action” refers to
the date of the filing of the complaint and before summons is served on the defendant.

03. How attachment effected.

Section 7, Rule 57 provides:

“SECTION 7. Attachment of real and personal property; recording thereof. — Real and
personal property shall be attached by the sheriff executing the writ in the following
manner:

(a) Real property, or growing crops thereon, or any interest therein, standing upon the
record of the registry of deeds of the province in the name of the party against whom
attachment is issued, or not appearing at all upon such records, or belonging to the party
against whom attachment is issued and held by any other person, orstanding on the
records of the registry of deeds a copy of the order, together with a description of the
property attached, and a notice that it is attached, or that such real property and any
interest therein held by or standing in the name of such other person are attached, and
by leaving a copy of such order, description, and notice with the occupant of the property,
if any, or with such other person or his agent if found within the province. Where the
property has been brought under the operation of either the Land Registration Act or the
Property Registration Decree, the notice shall contain a reference to the number of the

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certificate of title, the volume and page in the registration book where the certificate is
registered, and the registered owner or owners thereof.

The registrar of deeds must index attachments filed under this section in the names of the
applicant, the adverse party, or the person by whom the property is held or in whose
name it stands in the records. If the attachment is not claimed on the entire area of the
land covered by the certificate of title, a description sufficiently accurate for the
identification of the land or interest to be affected shall be included in the registration of
such attachment.”

An attachment levied on real state not duly recorded in the Registry of Property is not an
encumbrance on the attached property, nor can such attachment unrecorded in the
registry, serve as a ground for decreeing the annulment of the sale of the property, at the
request of another creditor.

Registration of attachment, writs and related processes.

An attachment, or copy of any writ, order or process issued by the court intended to
create or preserve any lien, status, right, or attachment upon registered land shall be filed
and registered in the Registry of Deeds for the province or city where the land lies, and,
in addition to the particulars required in such papers for registration, shall contain a
reference to the number of the certificate of title affected and the registered owner or
owners thereof, and also, if the attachment, order, process or lien is not claimed on all the
land in any certificate of title, a description sufficiently accurate for identification of the
land or interest intended to be affected. A restraining order, injunction or mandamus
issued by the court shall be entered and registered on the certificate of title affected, free
of charge.

Knowledge of a prior unregistered interest is equivalent to registration.

In case of a conflict between a vendee and an attaching creditor, an attaching creditor

who registers the order of attachment and the sale of the property to him as the highest
bidder acquires a valid title to the property, as against a vendee who had previously
bought the same property from the registered owner but who failed to register his deed
of sale. This is because registration is the operative act that binds or affects the land
insofar as third persons are concerned. It is upon registration that there is notice to the
whole world. But where a party has knowledge of a prior existing interest which is
unregistered at that 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.

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Discharge of attachment.

An attachment may be discharged upon giving a counterbond, or on the ground that the
same was improperly or irregularly issued or enforced, or that the bond is insufficient.

By the dissolution of an attachment levied on the defendant’s property, through the filing
of a bond, the released property becomes free and no longer liable to the results of the
proceeding in which it was attached. Consequently, the act of the defendant, whose
property has been attached, in mortgaging the released property to a third person, is not
a conveyance in fraud of creditors, since the transaction is legal and valid, and since the
presumption of fraud established by Article 1387 of the Civil Code does not arise when
there is a security in favor of the creditor.

Section 70. Adverse Claim – “Whoever claims any part or interest in registered land
adverse to the registered owner, arising subsequent to the date of the original
registration, may, if no other provision is made in this Decree for registering the
same, make a statement in writing setting forth fully his alleged right or interest, and
how or under whom acquired, a reference to the number of the certificate of title of
the registered owner, the name of the registered owner, and a description of the land
in which the right or interest is claimed.

The statement shall be signed and sworn to, and shall state the adverse claimant's
residence, and a place at which all notices may be served upon him. This statement
shall be entitled to registration as an adverse claim on the certificate of title. The
adverse claim shall be effective for a period of thirty days from the date of
registration. After the lapse of said period, the annotation of adverse claim may be
canceled upon filing of a verified petition therefor by the party in interest: Provided,
however, that after cancellation, no second adverse claim based on the same ground
shall be registered by the same claimant.

Before the lapse of thirty days aforesaid, any party in interest may file a petition in
the Court of First Instance where the land is situated for the cancellation of the
adverse claim, and the court shall grant a speedy hearing upon the question of the
validity of such adverse claim, and shall render judgment as may be just and
equitable. If the adverse claim is adjudged to be invalid, the registration thereof shall
be ordered canceled. If, in any case, the court, after notice and hearing, shall find that
the adverse claim thus registered was frivolous, it may fine the claimant in an
amount not less than one thousand pesos nor more than five thousand pesos, in its

41
discretion. Before the lapse of thirty days, the claimant may withdraw his adverse
claim by filing with the Register of Deeds a sworn petition to that effect”

Adverse Claim, Nature and Purpose.

Purpose of annotating the adverse claim on the title of the disputed land is to
apprise third persons that there is a controversy over the ownership of the land and to
preserve and protect the right of the adverse claimant during the pendency of the
controversy

Notice to third persons that any transaction regarding the disputed land is
subject to the outcome of the dispute

Such is registered by filing a sworn statement with the RD of the province where
the property is located, setting forth the basis of the claimed right together with other
data pertinent thereto. The registration of an adverse claim is expressly recognized
under Section 70. Where the notice of adverse claim is sufficient in law and drawn up in
accordance with existing requirements, it becomes the ministerial duty of the RD to
register the instrument without unnecessary delay

While the act of registration is the operative act which conveys or affects the land
insofar as third persons are concerned, the 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 the sale

Section 70 is divided into two parts—first refers to the petition of the party who
claims any part or interest in the registered land, arising subsequent to the date of the
original registration, for the registration of his adverse claim, which is a ministerial
function of the Register of Deeds absent any defect on the face of the instrument. The
second refers to the petition filed in court by a party in interest for the cancellation of
the adverse claim upon showing the same is
invalid.

Registration of Adverse Claim

A. Instance where an Adverse Claim may be registered:

• A lease over a parcel of land for a 10-year period, which could not be
registered because the owner’s duplicate of title wasn’t surrendered; the
owner couldn’t be compelled to surrender the owner’s duplicate of the
title to that adverse claim could be annotated thereon;

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 B. Instances where an Adverse Claim May Not be registered:

• A lease over a parcel of land for a 10-year period, which could not be
registered because the owner’s duplicate of title wasn’t surrendered;
the owner couldn’t be compelled to surrender the owner’s duplicate of
the title to that adverse claim could be annotated thereon;
• A lease over a parcel of land for a 10-year period, which could not be
registered because the owner’s duplicate of title wasn’t surrendered;
the owner couldn’t be compelled to surrender the owner’s duplicate of
the title to that adverse claim could be annotated thereon

Requirements of an Adverse Claim

1. The adverse claimant must state the following in writing :

a.) His alleged right or interest;

b.) How and under whom such alleged right or interest is acquired;

c.) The description of the land in which the right or interest is claimed;

2. The Statement must be signed and sworn to before a notary public or other
officer authorized to administer oath; and
3. The Claimant should state his residence or the place to which all notices may
be served upon him.

Registration Court May Determine the Validity Of Adverse Claim

An adverse claim may be cancelled only after the claim is adjudged invalid and
unmeritorious by the court while passing upon a case where the land involved is
subject of the interest or right being secured by the adverse claim.

Adverse Claim Not Ipso Jure Cancelled After 30 Days; Hearing Necessary

Register of Deeds cannot unilaterally cancel the adverse claim. There must be a
court hearing for the purpose. The reason for this is to afford the adverse claimant an
opportunity to be heard, providing a venue where the propriety of his claimed interest

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can be established or revoked, all for the purpose of determining at least the existence of
any encumbrance on the title arising from such adverse claim.

Purchaser Not Bound by Any Lien Not Entered In the Certificate of Title
Foreclosure Sale Retroacts to Registration of Mortgage

The settled doctrine is that the effects of a foreclosure sale retroact to the date of
registration of the mortgage. Hence, if the adverse claim is registered only after the
annotation of the mortgage at the back of the certificate of title, the adverse claim could
not affect the rights of the mortgagee; and the fact that the foreclosure of the mortgage
and the consequent public auction sale have been effected long after the annotation of
the adverse claim is of no moment, because the foreclosure sale retroacts to the date of
registration of the mortgage.

Section 71. Surrender of Certificate in Involuntary Dealings – “If an attachment or

other lien in the nature of involuntary dealing in registered land is registered, and
the duplicate certificate is not presented at the time of registration, the Register of
Deeds shall, within thirty-six hours thereafter, send notice by mail to the registered
owner, stating that such paper has been registered, and requesting him to send or
produce his duplicate certificate so that a memorandum of the attachment or other
lien may be made thereon. If the owner neglects or refuses to comply within a
reasonable time, the Register of Deeds shall report the matter to the court, and it
shall, after notice, enter an order to the owner, to produce his certificate at a time and
place named therein, and may enforce the order by suitable process.”

A. Court May Compel Surrender Of Certificate Of Title As An Incident In The

Main Case

RD is authorized to require the registered owner to produce the owner’s duplicate

certificate in order that an attachment or other lien in the nature of involuntary dealing,
may be annotated thereon.

If the owner refuses or neglects to comply within reasonable time, he shall report
such fact to the proper RTC which shall, after notice, direct the owner to produce his
certificate at a time and place specified in its order.

B. Mortgage Lien Follows Mortgaged Property

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 Any lien annotated on the previous certificates of title which subsists should be
incorporated in or carried over to the new transfer certificate of title. This is true even in
the case of a real estate mortgage because pursuant to Article 2126 of the Civil Code, the
mortgage directly and immediately subjects the property whoever the possessor may
be, to the fulfillment of the obligation for whose security it was constituted.

It is inseparable from the property mortgaged as it is a right in rem—a lien on the

property whoever its owner may be.

Section 72. Dissolution, etc. of attachments, etc. Attachments – “Attachments and

liens of every description upon registered land shall be continued, reduced,
discharged and dissolved by any method sufficient in law, and to give effect to the
continuance, reduction, discharge or dissolution thereof the certificate or other
instrument for that purpose shall be registered with the Register of Deeds. Section
73. Registration of orders of court, etc. If an attachment is continued, reduced,
dissolved, or otherwise affected by an order, decision or judgment of the court where
the action or proceedings in which said attachment was made is pending or by an
order of a court having jurisdiction thereof, a certificate of the entry of such order,
decision or judgment from the clerk of court or the judge by which such decision,
order or judgment has been rendered and under the seal of the court, shall be entitled
to be registered upon presentation to the Register of Deeds.”

Where an attachment or lien is maintained, or discharged or dissolved by any

method provided by law, the certificate or instrument for the purpose shall be
registered to give effect thereof;

If the attachment or lien is maintained, discharged or dissolved by the order of

the court, a certificate of the Clerk of Court as to the entry of such order shall also be
registered.

Section 73. Registration of orders of court, etc.– ”If an attachment is continued,

reduced, dissolved, or otherwise affected by an order, decision or judgment of the
court where the action or proceedings in which said attachment was made is pending
or by an order of a court having jurisdiction thereof, a certificate of the entry of such
order, decision or judgment from the clerk of court or the judge by which such
decision, order or judgment has been rendered and under the seal of the court, shall
be entitled to be registered upon presentation to the Register of Deeds.”

The purpose of registration is to notify third persons who maybe affected in their
dealings with respect to such property.

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 The Register of Deeds may properly deny inscription of an order of attachment
or levy of execution where the title to the property is not in the name of the judgment
debtor but of another person, and no evidence has been submitted that he has any
interest in the property.

Sec. 74. ENFORCEMENT OF LIENS ON REGISTERED LAND

All the instruments made in the course of proceedings to enforce liens and required by
law to be recorded shall be

✓ Filed with: The Register of Deeds of the province or city where the land
lies.
✓ Registered in: The registration book
✓ Memorandum: upon the proper certificate of title in each case as lien or
encumbrance

Registration of deeds relating to execution and tax delinquency sales

The following incidents on registered land in the nature of involuntary dealings shall be
registered to be effective:

a. Continuance, dissolution or discharge of attachments

b. Orders or decisions of the court
c. Deed of sale, officer’s return, order of execution and other instruments

Tax delinquency sale requires personal notice to taxpayer

Requirement of law: Notice of sale to delinquent land owners and to the public
in general.
Reasons:

- The holding of a tax sale despite the absence of the requisite notice is
tantamount to a violation of delinquent taxpayer’s substantial right to
due process.
- Administrative proceedings for the sale of private lands for non-
payment of taxes is a proceeding in personam hence, it is essential that
there be actual noice to the delinquent taxpayer

Effect of non-fulfillment of requirement: Vitiates the sale or null and void sale
(even if preceded by proper advertisement or publication.

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SEC. 75 APPLICATION FOR NEW CERTIFICATE UPON EXPIRATION OF
REDEMPTION PERIOD

In case registered land which has been sold on execution for the enforcement of any
lien, except a mortgage lien, has not been redeemed within the period allowed by law,
the purchaser at such sale or anyone claiming under him may petition the court for the
issuance of a new certificate of title to him.

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

SEC. 76 NOTICE OF LIS PENDENS

Lis pendens- A pending suit.

Nature and Purpose of lis pendens

• The Doctrine of lis pendens refers to the jurisdiction, power or control which a
court acquires over property involved in a suit, pending the continuance of the
action, and until final judgment.
• The purposes of lis pendens are
(1) to protect the rights of the party causing the registration of the lis
pendens, and

(2) to advise third persons who purchase or contract on the subject

property that they do so at their peril and subject to the result of the
pending litigation.

A notice of lis pendens

- is an announcement to the whole world that a particular real property

is in litigation. The inscription serves as a warning that one who
acquires an interest over litigated property does so at his own risk, or
that he gambles on the result of the litigation over the property.
- may involve actions that deal not only with title or possession of a
property, but also with the use or occupation of a property. The
litigation must directly involve a specific property which is necessarily
affected by the judgment.
- It is not part of the doctrine of notice, the purchaser pendent elite is
affected not by notice but because the law doesn’t allow litigating
parties to give to others, pending the litigation, rights to the property in
dispute so as to prejudice the other party.

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 - Notice is only an incident in the main case; merits thereof unaffected
o A notice of lis pendens is ordinarily recorded without the
intervention of the court where the action is pending. It is but an
incident in an action, an extrajudicial one. It doesn’t affect the
merits thereof.
- Notice need not be annotated on the owner’s copy
o Annotation at the back of the original copy of the certificate of
title on file with the Register of Deeds in involuntary
registration is sufficient to constitute constructive notice to
purchasers or other persons subsequently dealing with the
same property
o Annotation in owner’s copy is only necessary in voluntary
transactions.
- One who deals with property subject of a notice of lis pendens cannot
invoke the right of a purchaser in good faith—neither can he acquire
the rights better than those of his predecessor-ininterest

The filing of lis pendens in effect:

(a) keeps the subject matter of litigation within the power of the court until the entry of
the final judgment so as to prevent the defeat of the latter by successive alienations’
and

(b) binds a purchaser of the land subject of the litigation to the judgment or decree
that will be promulgated thereon whether such a purchaser is a bona fide purchaser
or not; but

(c) does not create a non-existent right or lien.

If the notice is effective, the third person who acquires the property affected by lis pendens
takes same subject to the eventuality of the litigation. It loses its efficacy when the adverse
right fails in litigation.

NOTICE OF LIS PENDENS—WHEN NOTICE NOT PROPER IN THE

APPROPRIATE FOLLOWING
(1) Action to recover possession of (1) Preliminary attachments
real property (2) Proceedings for the probates of
(2) Action to quiet title thereto wills
(3) Action to remove cloud thereon (3) Levies on execution

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 (4) Action for partition
(5) Any other proceedings of any
kind in court directly affecting
thetitle to the land or the use or
occupation thereof or the
buildings thereon
(4) Proceedings for the administration
of estate of deceased persons
(5) Proceedings in which the only
subject is the recovery of a money
judgment

Contents of notice of lis pendens are:

1. A statement of the institution of an action or proceedings

2. The court where the same is pending
3. The date of its institution
4. A reference to the number of certificate of title of the land
5. An adequate description of the land affected and its registered
owner

Principle of primus tempore, potior jure; effect of lis Pendens (first in time, stronger
in right)
- The principle of primus tempore, potior jure gains greater significance in the law
on double sale of immovable property: When the immovable is sold twice, the one
who acquires it and first record it in the Registry of Property, shall be deemed the
owner but the act of registration must be coupled with good faith.
- Reliance on the principle of constructive notice operates only such upon the
registration of the notice of lis pendens

Carry over of notice on subsequent titles

- In case of subsequent transfers or sales, the Register of Deeds is duty bound to
carry over the notice of lis pendens on all titles to be issued.
- If it cancels the notice in violation of his duty, a civil and criminal action may be
instituted against the Register of Deeds for any prejudice caused to innocent third
person.

SEC. 77 CANCELLATION OF LIS PENDENS

Ordinarily a notice which has been filed in a proper case cannot be cancelled while the
action is pending and undetermined, except in cases expressly provided for by statute.
But the court has inherent power in the absence of of statute to cancel a lis pendens in
proper case.

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 - It may be cancelled:
a) upon order by the court
b) upon action by the Register of Deeds at the instance of the party who caused
the registration of the notice

Two Grounds of Cancellation of a notice of lis pendens

(1) If the annotation was for the purpose of molesting the title of the adverse party
(2) When the annotation isn’t necessary to protect the title of the party who caused it
to be recorded

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