Case Summary (G.R. No. 236140)
Applicable Law
This decision is primarily based on the 1987 Philippine Constitution and relevant provisions of the Civil Code concerning co-ownership, rights of ownership, encumbrances on titles, and the legal effect of sales involving real property.
Factual Background
The initial ownership of the concerned parcel of land was established under Transfer Certificate of Title (TCT) No. 15296 issued in the names of Hilario and Dorotea. After Hilario's death, Dorotea sold a half portion of the property to her daughter, Josefina, through a Deed of Absolute Sale executed on July 28, 2001. This sale, however, was not registered as Josefina left for the United States and entrusted the documents to her brother William, who failed to register them. Subsequently, Dorotea executed a Deed of Extrajudicial Settlement of Estate, transferring her remaining rights to her daughters Imelda and Adelaida without Josefina’s knowledge, leading to the issuance of a new title, TCT No. 269811.
Chronology of Events
- Death of Hilario Solis: After Hilario's death in 1955, the property was co-owned by his widow Dorotea and two daughters, Imelda and Adelaida.
- Sale to Josefina (2001): Dorotea sold a half portion to Josefina via a formal deed, but this was not registered.
- Extrajudicial Settlement (2002): Dorotea executed a document transferring her remaining interest in the property to Imelda and Adelaida.
- Court Petition for Duplicate Title (2003): Imelda applied for a second owner's duplicate of TCT No. 15296, claiming the original was lost, which led to the issuance of TCT No. 269811.
- Sale to Spouses Badar (2003): Imelda and Adelaida sold the property, now titled as TCT No. 269811, to Spouses Badar.
Judicial Proceedings
Josefina's complaint against the Badars and her sisters claimed nullity of titles and recovery of possession. The Regional Trial Court (RTC) found in favor of the respondents, ruling the Deed of Absolute Sale valid, but only for 1/2 undivided share, dismissing the complaint against Spouses Badar citing their status as bona fide purchasers for value.
Court of Appeals Decision
The Court of Appeals (CA) affirmed the RTC judgment, noting the validity of the sale between Adelaida and Imelda to Spouses Badar while increasing the damages owed to Josefina from P500,000.00 to P1,500,000.00 due to the acknowledgment of a higher selling price. Josefina’s motion for reconsideration was denied.
Issue Raised
The core issue examined was whether the CA committed grave abuse of discretion by ruling that Spouses Badar were buyers in good faith despite the annotation under Section 4, Rule 74 that indicated potential encumbrances on the property in question.
Court's Ruling
The Supreme Court determined that both lower courts had misapprehended relevant facts and overlooked evidence indicating that the title and ownership claims were compromised by the improper registration of the title. The Court ruled that the annotation of Section 4, Rule 74 on the certificates of title should ha
Case Syllabus (G.R. No. 236140)
Nature of the Case and Procedural History
- This case is a Petition for Review on Certiorari filed by Josefina C. Billote under Rule 45 of the Rules of Court.
- The petition assails the August 2, 2017 Decision and November 20, 2017 Resolution of the Court of Appeals (CA) in CA-G.R. CV No. 105484.
- The CA upheld the Regional Trial Court (RTC) Decision dated January 27, 2015 dismissing Josefina's complaint for annulment or nullity of titles, recovery, and damages except increasing the damages payable to Josefina from P20,000.00 to P1,500,000.00 plus legal interest.
- The CA also denied Josefina's Partial Motion for Reconsideration.
Factual Background
- The subject property is a parcel of land in Urdaneta City, Pangasinan, measuring 6,894 square meters, originally titled to spouses Hilario Solis and Dorotea Corla Solis.
- Hilario died in 1955; Dorotea remarried Segundo Billote and had two children: Josefina and William.
- On July 28, 2001, Dorotea sold and conveyed an undivided one-half portion (3,447 sq. m.) of the property to Josefina for P20,000, with the owner's duplicate certificate of title (TCT No. 15296) delivered to Josefina.
- On July 13, 2002, Dorotea, Adelaida, and Imelda executed an Extrajudicial Settlement of Estate with Quitclaim whereby Dorotea relinquished her remaining undivided shares to Adelaida and Imelda.
- Imelda secured a second owner's duplicate copy of TCT No. 15296 after the original was lost, which was later invalidated by the Supreme Court.
- Adelaida and Imelda sold the whole property to spouses Victor and Remedios Badar on November 5, 2003, who took possession and had TCT No. 274696 issued in their names.
Issues Raised
- The crux of the dispute is whether spouses Badar are buyers in good faith despite the annotation of Section 4, Rule 74 in the titles indicating possible claims against the property.
- Whether the sales and transfers, given the defective titles and nullity of the second owner's duplicate certificate, are valid.
- The rights of Josefina over the one-half undivided portion of the subject property sold to her by Dorotea.
Legal Principles and Applicable Laws
- Article 493 of the Civil Code: a co-owner may alienate his undivided share without consent of other co-owners, but alienation is limited to the ideal or abstract share until partition.
- Section 4, Rule 74 of the Rules of Court: addresses the liability of distributees and estates when an heir or creditor is deprived of lawful participation within two years from distribution.
- Section 53, PD 1529 (Property Registration Decree): requires presentation of the owner's duplicate certificate for registration of voluntary instruments and states that registration