The Supreme Court (SC) has ruled that land buyers must verify ownership by checking the certificate of title and reviewing the records in the Registry of Deeds to avoid fraudulent transactions.
In a decision penned by Associate Justice Alfredo Benjamin Caguioa, the SC’s Third Division upheld the rulings of the Regional Trial Court and Court of Appeals, which voided the land titles of spouses Orencio and Eloisa Manalese.
The SC found that they failed to conduct due diligence when buying land from Carina Pinpin, who acquired her titles through fraud.
The Manaleses purchased two parcels of land from Pinpin, who presented certificates of title in her name and claimed to have bought the properties from the original owners, the late Narciso and Ofelia Ferreras. Pinpin showed a deed of sale as proof of her ownership, which allowed spouses Manalese to transfer the titles to their name.
However, Danilo Ferreras, the administrator of the Ferreras estate, challenged the validity of these titles before the RTC, claiming the properties still legally belonged to the estate. He alleged that Pinpin fraudulently obtained duplicate titles by submitting a false affidavit of loss and a forged deed of sale. She then used these to sell the properties to spouses Manalese.
The couple argued that they were innocent buyers, who relied on what appeared to be clean titles.
However, the RTC and CA ruled that the spouses were buyers in bad faith because they failed to investigate the property’s ownership history despite warning signs.
First, the deed of sale presented by Pinpin was executed and notarized after the original owners were already deceased. Second, Pinpin purchased the properties for only P250,000 but sold them for P3,300,000 – a massive increase in value.
The SC upheld the lower courts’ findings, stressing that buyers must check both the certificate of title and the Registry of Deeds records before purchasing land.
Relying solely on a certificate of title is insufficient, especially if there are signs of fraud or irregularity, the SC Office of the Spokesperson said in a press release March 6.
The SC ruled that buyers who ignore suspicious facts cannot claim to be in good faith. In this case, spouses Manalese failed to investigate despite multiple warning signs, making them liable for not exercising due diligence.
Under Presidential Decree (PD) 1529, or the Property Registration Decree, a re-issued title is only a duplicate and does not have the same legal weight as the original title. Buyers dealing with such titles must be careful, as any subsequent registration based on a forged duplicate title is invalid.
Since spouses Manalese were dealing with duplicate certificates, they should have verified these with the Registry of Deeds, which would have revealed the fraudulent transactions. ||
