G.R. No.

143027 October 11, 2005

ENCARNACION L. CUIZON and SALVADOR CUIZON, Petitioners,
vs.
MERCEDES C. REMOTO, LEONIDA R. MEYNARD, CELERINA R. ROSALES and REMEDIOS C.
REMOTO, Respondents.
DECISION
AUSTRIA-MARTINEZ, J.:
The parties in this case are vying for ownership of a 4,300 square meter-land located in
Barangay Basilisa, Remedios T. Romualdez, Agusan del Norte.
Petitioners-spouses Encarnacion L. Cuizon and Salvador Cuizon rely on Transfer Certificate of
Title (TCT) No. RT-3121 in the name of "Encarnacion L. Cuizon, married to Salvador Cuizon,"
issued by the Registry of Deeds of Agusan del Norte on March 15, 1984,1 pursuant to a
notarized Extra-Judicial Settlement with Sale dated August 3, 1983 (1983 Extra-Judicial
Settlement with Sale) executed by the heirs of Placida Tabada-Lambo (Placida), wherein they
adjudicated unto themselves the one-fourth share of Placida, and, at the same time, sold said
portion to their co-heir, Encarnacion L. Cuizon.2 TCT No. RT-3121 is a transfer from TCT No.
RT-183 which originally covers 16 hectares in the name of Placida (married to Gervacio
Lambo), Eugenio Tabada, Raymunda Tabada and Patrecia Tabada, each being one-fourth
shareowner.3
On the other hand, respondents have in their favor a notarized Deed of Sale of Real Property
dated September 19, 1968, (1968 Deed of Sale) involving a portion of the same property
covered by TCT No. RT-183, measuring 4,300 square meters, executed by Placida in favor of
Angel Remoto (Angel), husband of respondent Mercedes C. Remoto, and father of the other
respondents, Leonida R. Meynard, Celerina R. Rosales and Remedios C. Remoto.4
In a Decision dated March 9, 1990 rendered by the Regional Trial Court of Butuan City (Branch
3) in Civil Case No. 2846, which is an action for reconveyance filed by respondents against
petitioners on August 13, 1984, the trial court ruled in favor of respondents and ordered that
the property be reconveyed to them. The dispositive portion of the decision reads:
Wherefore, judgment is rendered in favor of herein plaintiffs Mercedes Remoto and children
Celerino R. Rosales, Leonida R. Meynard, Candelaria and Remedios both surnamed Remoto,
and against defendant-spouses Salvador and Encarnacion Cuizon ordering the latter:
1) To immediately reconvey the lot in question to herein plaintiffs;
2) To pay the sum of Two Thousand (P2,000.00) Pesos as litigation expenses;
3) To pay the sum of Five Thousand (P5,000.00) Pesos as attorneys fees; and
4) To pay the costs (sic) of suit.
Done in Chambers this 9th day of March, 1990, at Butuan City, Philippines.5
In awarding the property to respondents, the trial court made the following findings and
conclusion, which the Court quotes with approval, viz.:
. . . a careful examination of the evidence on record shows that the evidence of the plaintiffs is
strong, substantial convincing and worthy of belief than that of the defendants. The plaintiffs
can legally claim possession and ownership of the lot in dispute covered by the onepaged
duly notarized but unregistered Deed of Sale of Real Property (Exh. A, Rollo, p. 45 or 89). A
perusal of this document discloses that it was duly notarized and signed by vendor Placida
Tabada, together with [h]usband Gervacio Lambo, and vendee Angel Remoto. Incidentally, the
defendants-spouses utterly failed to prove any defect and irregularity in the exec[u]tion of this
Exh. A.
It is the posture of the defendants-spouses that this "state" (sic) and unregistered deed of sale

(Exh. A) "has lost its due execution and genuineness and the fact of its being a public
document"; that it cannot defeat the duly registered Deed of Extrajudicial Settlement with
Absolute Sale (Exh. 1-B); and that the issuance of TCT No. RT-3121 in favor of defendantsspouses (Exh. 3) conferred the latter a better right to the litigated lot under the Torrens
system.
This Court is not in accord to (sic) these posturings of defendants-spouses. Exhibit A, which is
duly notarized, is a public document. Although it is not registered, it is still enforceable and
binding not only between the parties but also their successors-in-interest.
It is likewise [the] stance of defendants-spouses that they are purchasers in good faith and for
value of the lot in question. This fact is vividly rebutted by the straight forward and credible
testimonies of plaintiffs Mercedes O. Remoto and Candelaria Remoto. Both testified that it was
in September, 1982, not in 1983 as defendant Salvador Cuizon wants this court to believe,
when defendants-spouses went to the residence of the Remotos and learned of the existence of
Exhibit A; that it was on this occasion that defendants-spouses were actually shown the
document, and that they read and examined the same (Vide, tsn. December 28, 1984, 284-289;
tsn. April 24, 1986, 32, 34-37).
Besides, defendants-spouses could not feign ignorance of the unrebutted fact that the plaintiffs
had enjoyed continuous, open, adverse and public possession of the litigated lot in the concept
of an owner for a duration of fourteen years or more, i.e., from September 19, 1968, the date of
execution of Exhibit A, to the present (tsn. December 28, 1984, 283-284) or until September,
1982 when they became aware of the existence of Exhibit A. Nor could the defendants-spouses
deny the unrebutted fact that they never had taken possession of the litigated lot (tsn. id., 274275).
Despite their knowledge of the existence of the Exhibit A and of the continuous public and
adverse possession for fourteen years of the lot by the plaintiffs, defendants-spouses had
caused the execution of the Deed of Extrajudicial Settlement with Sale on August 3, 1983 by
the Heirs of Placida Tabada-Lambo in their favor (Exh. 1-B), and the consequent issuance of
TCT RT-3121 in the name of defendant Encarnacion-Cuizon (Exh. 3). Hence, defendantsspouses were buyers in bad faith. They could not pretend a lack of knowledge of plaintiffs
claim and interest in the land. They also acted in bad faith in the registration of the Deed of
Extrajudicial Settlement with Sale (Exh. 1-B) and in their acquisition of TCT RT-3121 (Exh. 3).

Since defendants-spouses knew of the existence of the first deed of sale, Exhibit A, this first
unregistered deed of sale prevails over the registered second deed of sale, Exhibit 1-B.

It is also stressed herein that the claim of defendants-spouses that they bought the disputed lot
in 1964 on installment basis from Placida Tabada and Gervacio Lambo cannot be given
credence. This claim of theirs is self-serving and an afterthought in their last attempts to
bolster their defense. In the absence of a written document embodying the supposed deed of
sale, the latter is unenforceable contract. This conclusion is in pursuance to sub-paragraph (e),
paragraph 2 of Art. 1403 of the Civil Code.
Furthermore, it is the submission of the defendants-spouses that Exhibit A is a simulated
contract because the questioned lot was intended for donation as a barrio site. This submission
of their (sic) cannot be sustained in the absence of a written deed of donation.
In fine, this Court finds and so holds that the Deed of Sale of Real Property of September 1968
(Exh. A) can be the legal basis not only of the possession and ownership of the lot in litigation,
but also for the reconveyance of the same in favor of the plaintiffs.6
On appeal by petitioners, docketed as CA-G.R. CV No. 31587, the Court of Appeals (CA)
affirmed the findings and conclusion of the trial court in its Decision7 dated December 16,
1999, the dispositive portion of which reads:
WHEREFORE, foregoing premises considered, the instant appeal being devoid of any merit in

fact and in law, is hereby ordered DISMISSED; and the decision appealed from hereby
AFFIRMED IN TOTO.
With cost to Defendants-appellants.
SO ORDERED.8
Petitioners filed a motion for reconsideration but the CA denied it per Resolution dated March
31, 2000.9
In the present petition for review, petitioners insist that they are the rightful owners of the
property based on TCT No. RT-3121, and that the 1968 Deed of Sale is void, fictitious,
unenforceable and has no legal effect. Petitioners also argue that: (1) the property is covered
by TCT No. RT-183 issued on June 21, 1930, and every person dealing with registered land may
safely rely on the correctness of the title; (2) at the time the 1968 Deed of Sale was executed,
no written notice was given to all possible co-redemptioners, co-heirs, and co- owners, as
provided for under Articles 1620 and 1623 of the Civil Code; (3) respondents possession is
ineffectual against a torrens title; and (4) respondents action is barred by prescription and
laches.10
The issue in this case is: who has a better right to the property in dispute?
As a rule, the Court cannot review the factual findings of the trial court and the CA in a petition
for review on certiorari under Rule 45 of the Rules of Court.11 It should be stressed that a
review by certiorari under Rule 45 is a matter of discretion. Under this mode of review, the
jurisdiction of the Court is limited to reviewing only errors of law, not of fact. When supported
by substantial evidence, findings of fact of the trial court as affirmed by the CA are conclusive
and binding on the parties.12 This Court will not review unless there are exceptional
circumstances, viz.: (a) where the conclusion is a finding grounded entirely on speculation,
surmise and conjectures; (b) where the information made is manifestly mistaken; (c) where
there is grave abuse of discretion; (d) where the judgment is based on a misapplication of facts,
and the findings of facts of the trial court and the appellate court are contradicted by the
evidence on record; and (e) when certain material facts and circumstances had been
overlooked by the trial court which, if taken into account, would alter the result of the case.13
There exists no exceptional circumstance in this case that would warrant a departure from the
factual findings of both the trial court and the CA.
As correctly ruled by both the trial court and the CA, the 1968 Deed of Sale executed by
Placida in favor of Angel should prevail over the 1983 Extra-Judicial Settlement with Sale made
by the heirs of Placida in favor of petitioners-spouses Cuizon. Prior tempore, potior jure. It
simply means, "He who is first in time is preferred in right." The only essential requisite of this
rule is priority in time, and the only one who can invoke this is the first vendee.14 Records bear
the fact that when Placida sold her one-fourth portion of the property covered by TCT No. RT183 in 1968, the 1983 Extra-Judicial Settlement with Sale was still inexistent, and more
importantly, said portion was yet to be transferred by succession to Placidas heirs. The records
also show that after Placida sold her portion to Angel, the latter immediately took possession of
the same. Applying the principle of priority in time, it is clear that Angel, and consequently his
heirs, the respondents herein, have a superior right to the property.
It must be noted that the sale by Placida to Angel is evidenced by a duly notarized deed of sale.
Documents acknowledged before notaries public are public documents and public documents
are admissible in evidence without necessity of preliminary proof as to their authenticity and
due execution. They have in their favor the presumption of regularity, and to contradict the
same, there must be evidence that is clear, convincing and more than merely preponderant.15
Petitioners failed to present any clear and convincing evidence to prove that the deed of sale is
"void, fictitious, unenforceable and has no legal effect."
Petitioners harp on the fact that the 1968 Deed of Sale dated September 19, 1968, while
notarized, was not registered or annotated on TCT No. RT-183. Petitioners must be reminded
that registration is not a requirement for validity of the contract as between the parties, for the
effect of registration serves chiefly to bind third persons.16 Petitioners are not third persons
within the contemplation of the registration rule. The conveyance shall not be valid against any
person unless registered, except (1) the grantor, (2) his heirs and devisees, and (3) third

persons having actual notice or knowledge thereof. Petitioners are both related to the original
owner of the property, Placida. Petitioner Encarnacion Lambo-Cuizon is an heir of Placida,
while Salvador Cuizon is Encarnacions husband. Hence, registration is not required to bind
petitioners.
Furthermore, where the party has knowledge of a prior existing interest which is unregistered
at the time he acquired a right to the same land, his knowledge of that prior unregistered
interest has the effect of registration as to him.17 As was found by the trial court, before
petitioners bought the property in 1983, they went to the Remotos residence in 1982 and were
shown a copy of the 1968 Deed of Sale. While petitioners dispute the year, saying that it was in
1983 and not 1982 when they went to the Remotos residence, the Court abides by the trial
courts finding considering that it was in the best position to assess the respective testimonies
of the contending claimants.18
Petitioners rely heavily on TCT No. RT-3121 issued in their names. In the first place, the
issuance of the title was made pursuant to the 1983 Extra-Judicial Settlement with Sale. At the
time this document was entered into by the heirs of Placida, the latter was no longer the owner
of the property, having earlier sold the same to Angel. No one can give what one does not have
-- nemo dat quod non habet. Accordingly, one can sell only what one owns or is authorized to
sell, and the buyer can acquire no more than what the seller can transfer legally.19 Such being
the case, the heirs of Placida did not acquire any right to adjudicate the property unto them
and sell it to Encarnacion.
Whats more, the defense of indefeasibility of the torrens title does not extend to a transferee
who takes the certificate of title with notice of a flaw in his title. The principle of indefeasibility
of title is unavailing where there was fraud that attended the issuance of the free patents and
titles.20 As previously noted, petitioners knew of the existence of the 1968 Deed of Sale as the
Remotos showed it to them in 1982, a year before the execution of the 1983 Extra-Judicial
Settlement with Sale. Thus, it cannot be said that petitioners are transferees in good faith and
therefore, the defense of indefeasibility of the torrens title is not applicable to them.
Likewise, petitioners cannot complain that no written notice was given to all possible
redemptioners or heirs at the time of the execution of the 1968 Deed of Sale. Under the
provisions of the Civil Code on Legal Redemption, it is stated:
Article 1620. A co-owner of a thing may exercise the right of redemption in case the shares of
all the other co-owners or of any of them, are sold to a third person. If the price of the
alienation is grossly excessive, the redemptioner shall pay only a reasonable one.
Should two or more co-owners desire to exercise the right of redemption, they may only do so
in proportion to the share they may respectively have in the thing owned in common.
Art. 1623. The right of legal pre-emption or redemption shall not be exercised except within
thirty days from the notice in writing by the prospective vendor, or by the vendor, as the case
may be. The deed of sale shall not be recorded in the Registry of Property, unless accompanied
by an affidavit of the vendor that he has given written notice thereof to all possible
redemptioners.
The right of redemption of co-owners excludes that of adjoining owners.
Corollary to these, Article 1088 of the Civil Code, provides:
Art. 1088. Should any of the heirs sell his hereditary rights to a stranger before the partition,
any or all of the co-heirs may be subrogated to the rights of the purchaser by reimbursing him
for the price of the sale, provided they do so within the period of one month from the time they
were notified in writing of the sale by the vendor.
The right of legal redemption pertains to Placidas original co-owners, namely, Eugenio Tabada,
Raymunda Tabada and Patrecia Tabada, and their respective heirs,21 not to petitioners who
are the heirs of Placida. Also, the written notification should come from the vendor or
prospective vendor, Placida in this case, and not from any other person.22 This is so because
the vendor is in the best position to know who are his co-owners that under the law must be
notified of the sale. Also, the notice by the seller removes all doubts as to fact of the sale, its

perfection; and its validity, the notice being a reaffirmation thereof, so that the party notified
need not entertain doubt that the seller may still contest the alienation. This assurance would
not exist if the buyer should give the notice.23
Even if the property has not yet been formally subdivided, still, records show that the
particular portions belonging to the co-owners have already been allocated and Placidas coowners have already been exercising proprietary rights over their respective allotments. Thus,
inscribed on TCT No. RT-183 are several deeds of mortgages executed by Placidas co-owner
Eugenio C. Tabada in favor of the Butuan City Rural Bank with respect to his one-fourth share,
and a Deed of Sale with Right of Repurchase dated May 13, 1968 executed by the spouses
Eugenio G. Tabada and Trinidad Ontong in favor of one Hernando R. Sanchez, also covering
Eugenios one-fourth portion of the property.24
The Court notes, however, that the property originally co-owned by Placida, Eugenio Tabada,
Raymunda Tabada and Patrecia Tabada, covered by TCT No. RT-183, measures 16 hectares,
while the 1968 Deed of Sale covers 4,300 square meters.
The right of Placida to sell her one-fourth portion of the property covered by TCT No. RT-183 is
sanctioned under Article 493 of the Civil Code, to wit:
Art. 493. Each co-owner shall have the full ownership of his part and the fruits and benefits
pertaining thereto, and he may therefore alienate, assign or mortgage it, and even substitute
another person in its enjoyment, except when personal rights are involved. But the effect of the
alienation or the mortgage, with respect to the co-owners, shall be limited to the portion which
may be allotted to him in the division upon the termination of the co-ownership.
The sale to Angel affects only Placidas pro indiviso share in the property, and Angel gets only
what corresponds to Placidas share in the partition of the property owned in common. Since a
co-owner is entitled to sell his undivided share, a sale of the entire property by one co-owner
without the consent of the other co-owners is not null and void; only the rights of the coowner/seller are transferred, thereby making the buyer a co-owner of the property.25
Given the foregoing, the portion sold by Placida and bought by Angel under the 1968 Deed of
Sale should only pertain to one-fourth of Placidas share in the 16-hectare property, or 4,000
square meters.
Lastly, prescription and laches do not apply in this case. To begin with, respondents have been
in actual and continuous possession of the property since Angel first bought it in 1968. If a
person claiming to be the owner thereof is in actual possession of the property, the right to
seek reconveyance, which in effect seeks to quiet title to the property, does not prescribe. The
reason for this is that one who is in actual possession of a piece of land claiming to be the
owner thereof may wait until his possession is disturbed or his title is attacked before taking
steps to vindicate his right, the reason for the rule being, that his undisturbed possession gives
him a continuing right to seek the aid of a court of equity to ascertain and determine the
nature of the adverse claim of a third party and its effect on his own title, which right can be
claimed only by one who is in possession.26
Neither can respondents be held guilty of laches. On the contrary, it was respondents vigilance
in protecting their right over the property that gave rise to the present case. Their action for
reconveyance was filed only after one year and ten days from the execution of the 1983 ExtraJudicial Settlement with Sale, one year and three days after its registration, and four months
and twenty-eight days after the issuance of TCT No. RT-3121. Obviously, laches has not yet set
in.
WHEREFORE, the petition is DISMISSED. The Court of Appeals Decision dated December 16,
1999 together with its Resolution dated March 31, 2000 in CA-G.R. CV No. 31587 is
AFFIRMED.
SO ORDERED.