G.R. No. 129782 - People vs. Singh

On September 5, 1985, petitioners, Jesus Ching and Lee Poe Tin, purchased a 370-square meter lot located at Barrio Tungtong, Las Piñas from Raymunda La Fuente.
Petitioners received from La Fuente a duly notarized Deed of Absolute Sale together with the Owner’s Duplicate Transfer Certificate of Title (TCT No. 83618) and subsequently took physical possession of the property.
For reasons known only to petitioners, the conveyance was not registered with the Register of Deeds as mandated by Section 51 of PD 1529.

Instead of registering the deed of sale, petitioners executed an Affidavit of Adverse Claim on November 20, 1986.
This adverse claim was recorded and annotated at the back of TCT No. 83618 under Entry No. 86-62262 in the Memorandum of Encumbrances.
Despite non-registration of the deed of absolute sale, petitioners maintained peaceful, continuous, and uninterrupted possession of the property.

On August 19, 1988, petitioners received a Notice of Levy on Attachment and subsequent Writ of Execution issued by the RTC of Pasig in connection with respondents’ case (Civil Case No. 54617) involving Raymunda La Fuente.
The Notice of Levy on Attachment was recorded on TCT No. 83618 under Entry No. 3433-2, while the Writ of Execution was inscribed under Entry No. 3434-2.
Subsequently, on January 26, 1989, a Certificate of Sale was inscribed in favor of respondents (spouses Adolfo and Arsenia Enrile), thereby reflecting their acquisition of the property through execution sale.

Petitioners filed a Petition to Remove Cloud on or Quiet Title to assert their ownership of the disputed property on January 8, 1990.
On May 11, 1993, the RTC of Makati City, Branch 135 ruled in favor of petitioners, declaring their title superior based on the earlier registration of the adverse claim over the Certificate of Sale in favor of respondents.
The RTC’s decision granted relief which included the cancellation of annotations in favor of respondents and payment of damages and attorney’s fees.

Respondents appealed the RTC decision to the Court of Appeals (CA) arguing that petitioners, notwithstanding the prior sale, failed to protect their interest by not registering the conveyance as required under PD 1529.
The CA maintained that the mere registration of an adverse claim (which was effective for only 30 days per Section 70 of PD 1529) was insufficient and that respondents acquired preferential rights by virtue of proper registration of the Notice of Levy, Writ of Execution, and Certificate of Sale.
On August 29, 2002, the CA reversed the RTC decision and its Resolution on November 21, 2002 denied petitioners’ motion for reconsideration.
Petitioners then elevated the issue before the Supreme Court on a petition for review on certiorari, faulting the CA for alleged reversible errors regarding the treatment of the adverse claim and the effect of registration on title.

Whether the registration of the Affidavit of Adverse Claim by petitioners, despite being unaccompanied by the registration of the Deed of Absolute Sale, is sufficient to protect their interest against subsequent encumbrances and conveyances.
Whether the adverse claim, once annotated on the TCT, remains effective beyond the 30-day period prescribed by Section 70 of PD 1529 in the absence of a cancellation petition.
Whether respondents, having acquired the property through attachment and subsequent sale, are considered purchasers in good faith despite having actual or constructive notice of petitioners’ prior dealings with the property.
Whether the CA committed reversible error in prioritizing the later registered documents (Notice of Levy, Writ of Execution, and Certificate of Sale) over petitioners’ earlier registered adverse claim.