G.R. No. 169548 - Titan Construction Corp. vs. Spouses David

The case involves Titan Construction Corporation (petitioner) and Manuel A. David, Sr. with Martha S. David (respondents).
Manuel and Martha were married on March 25, 1957 and acquired a 602 square meter lot in 1970 in White Plains, Quezon City.
The property was originally registered under TCT No. 156043 in Martha’s name “MARTHA S. DAVID, of legal age, married to Manuel A. David”, reflecting its conjugal nature.

In March 1995, Manuel discovered that Martha had sold the property to Titan Construction Corporation for P1,500,000.00 through a Deed of Sale dated April 24, 1995.
The original TCT No. 156043 was cancelled and replaced by TCT No. 130129 in the name of Titan.
Manuel filed a Complaint for Annulment of Contract and Reconveyance on March 13, 1996 alleging that the sale was made without his knowledge or consent, thereby voiding the Deed of Sale.

At the Regional Trial Court (RTC) of Quezon City, Manuel’s Complaint was initially filed, and Titan counterclaimed asserting it was a buyer in good faith relying on a Special Power of Attorney (SPA) supposedly granted by Manuel.
Manuel’s unverified Reply denied the authenticity of the SPA by alleging that his signature on the SPA was forged.
Manuel later filed a Motion for Leave to File an Amended Complaint, which was granted; Martha was impleaded but later declared in default for failing to file an answer.

Void the Deed of Sale dated April 24, 1995 and nullify TCT No. 130129.
Order Titan to reconvey the property to Manuel and Martha with issuance of a new title in their names.
Award Titan to pay P200,000.00 plus attorney’s fees (P1,000.00 per appearance) and P50,000.00 as costs of suit.

The property is conjugal, acquired with conjugal funds.
The SPA presented by Titan was spurious, lacking Manuel’s genuine signature as shown by expert testimony and non-compliance with registration requirements under Section 64 of P.D. No. 1529.
The circumstances of the transaction should have alerted Titan to potential irregularities regarding the SPA.

The Court of Appeals (CA) affirmed the RTC Decision on July 20, 2004 with modifications:

Deleting the award of attorney’s fees and the P50,000.00 costs.
Maintaining that the Deed of Sale is void and Titan is constructively ordered to reconvey the property.

Titan filed a motion for reconsideration which was denied on August 31, 2005, leading to the present petition.

Whether the CA erred in declaring the Deed of Sale null and void.
Whether Titan, as a buyer in good faith, should have been accorded the corresponding legal protections under the Torrens system of land registration.

Whether the SPA, allegedly signed by Manuel authorizing Martha to dispose of the property, is genuine or a forgery.
Whether the CA erred in giving weight to expert testimony regarding the contested signatures versus relying on the notarized status of the SPA.

Whether the CA should have detected any badges of connivance between the respondents and whether such connivance would estop them from denying the conjugal nature of the property and the need for both spouses’ consent.

Whether, assuming the sale was void, the CA erred in not ruling on the reimbursement of the purchase price paid by Titan to Martha, with legal interest, on grounds of equity.

Whether the failure of Titan to cross-claim against Martha or to object to the presentation and testimony regarding the SPA amounted to a waiver of its right to later contest the validity of the document.