Title
Filinvest Development Corp. vs. Golden Haven Memorial Park, Inc.
Case
G.R. No. 187824
Decision Date
Nov 17, 2010
Heirs sold land to GHM, later to Filinvest; SC upheld GHM's valid contracts, citing Filinvest's bad faith despite adverse claim notice.

Case Digest (G.R. No. 187824)
Expanded Legal Reasoning Model

Facts:

  • Inheritance, Partition, and Division of the Property
    • A parcel of land in Las PiAas City, covered by Transfer Certificate of Title (TCT) 67462 RT-1, was inherited by Petronila Yap, Victoriano and Policarpio Vivar, Benjamin Cruz, Juan Aquino, Gideon Corpuz, Francisco Sobremesana, and several other relatives.
    • The heirs divided the property into 13 lots through a judicial partition. Specifically:
      • Lots 1 and 12 were distributed to Aquino.
      • Lot 2 was allocated to Corpuz and Sobremesana.
      • Lot 6 was assigned to Yap, Cruz, and the Vivars.
      • The remaining lots were given to the other heirs.
  • Separate Agreements to Sell and Payment Arrangements
    • On March 6, 1989, Yap, on behalf of herself, Cruz, and the Vivars, executed an agreement to sell Lot 6 in favor of Golden Haven Memorial Park, Inc. (GHM), with payment arranged in three installments.
    • On July 31, 1989, Aquino, acting for himself, Corpuz, and Sobremesana, executed another agreement to sell Lots 1, 2, and 12 in favor of GHM, under similar installment terms.
    • In both transactions, GHM promptly paid the first installment upon execution of the respective contracts.
  • Annotation of Adverse Claim and Subsequent Communications
    • On August 4, 1989, GHM caused a Notice of Adverse Claim to be annotated on TCT 67462 RT-1.
    • Subsequently, on September 20, 1989, the sellers communicated in writing to GHM that they were still in the process of titling the lots in their names and inquired if GHM remained interested in proceeding with the agreements.
    • GHM reconfirmed its interest on September 21, 1989, indicating it was waiting for the titles to be issued so that the second installments could be paid.
  • The Involvement of Filinvest Development Corporation (Filinvest)
    • Sometime in August 1989, Filinvest applied for the transfer of the titles over Lots 2, 4, and 5, but its application was declined by the Las PiAas Register of Deeds.
    • Filinvest later discovered that Lot 8 (belonging to another heir and covered by the same mother title) had been sold to Household Development Corporation (HDC), a sister company of GHM, which then held the co-owner’s duplicate copy of TCT 67462 RT-1.
    • Acting on this development, Filinvest filed a petition for the surrender and cancellation of the co-owners’ duplicate copy of the title and contended that it had acquired Lots 1, 2, 6, and 12 through deeds of absolute sale dated September 10, November 18, and December 29, 1989.
  • Litigation and Procedural History
    • On January 14, 1991, GHM filed a complaint for the annulment of the deeds of sale in favor of Filinvest before the Regional Trial Court (RTC) of Las PiAas City (Civil Case No. 91-098), involving both the sellers and Filinvest.
    • The RTC, on March 16, 2006, after trial:
      • Declared the contracts-to-sell executed in favor of GHM valid and enforceable.
      • Declared the sale in favor of Filinvest null and void.
    • The Court of Appeals (CA) later affirmed part of the RTC decision on November 25, 2008:
      • Upheld the validity of the contract for Lot 6 in favor of GHM.
      • Declared the contracts for Lots 1, 2, and 12 in favor of GHM void while validating the sale to Filinvest for those lots.
    • Both parties subsequently filed petitions for review before the Supreme Court:
      • Filinvest in G.R. No. 187824.
      • GHM in G.R. No. 188265.

Issues:

  • Validity and Enforceability of the Contracts to Sell
    • Whether the contracts of sale executed by the sellers in favor of GHM, covering the same lots later sold to Filinvest, are valid and enforceable.
    • Whether the annotation of a Notice of Adverse Claim on the mother title (TCT 67462 RT-1) sufficiently warned Filinvest of potential defects in the sellers’ titles and the presence of double selling.

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)

Doctrine:

  • (Subscriber-Only)

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