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True Facts

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Gaite v. Fonacier
Facts:
Gaite was appointed by Fonacier as attorney-in-fact to contract any party for the exploration and development of mining claims. Gaite executed a deed of assignment in favor of a single proprietorship owned by him. For some reasons, Fonacier revoked the agency, which was acceded to by Gaite, subject to certain conditions, one of which being the transfer of ores extracted from the mineral claims for P75,000, of which P10,000 has already been paid upon signing of the agreement and the balance to be paid from the first letter of credit for the first local sale of the iron ores. To secure payment, Fonacier delivered a surety agreement with Larap Mines and some of its stockholders, and another one with Far Eastern Insurance. When the second surety agreement expired with no sale being made on the ores, Gaite demanded the P65,000 balance. Defendants contended that the payment was subject to the condition that the ores will be sold.
Issue:
(1) Whether the sale is conditional or one with a period
(2) Whether there were insufficient tons of ores
Held:
(1) The shipment or local sale of the iron ore is not a condition precedent (or suspensive) to the payment of the balance of P65,000.00, but was only a suspensive period or term. What characterizes a conditional obligation is the fact that its efficacy or obligatory force (as distinguished from its demandability) is subordinated to the happening of a future and uncertain event; so that if the suspensive condition does not take place, the parties would stand as if the conditional obligation had never existed.
A contract of sale is normally commutative and onerous: not only does each one of the parties assume a correlative obligation (the seller to deliver and transfer ownership of the thing sold and the buyer to pay the price),but each party anticipates performance by the other from the very start. While in a sale the obligation of one party can be lawfully subordinated to an uncertain event, so that the other understands that he assumes the risk of receiving nothing for what he gives (as in the case of a sale of hopes or expectations,emptio spei), it is not in the usual course of business to do so; hence, the contingent character of the obligation must clearly appear. Nothing is found in the record to evidence that Gaite desired or assumed to run the risk of losing his right over the ore without getting paid for it, or that Fonacier understood that Gaite assumed any such risk. This is proved by the fact that Gaite insisted on a bond a to guarantee payment of the P65,000.00, an not only upon a bond by Fonacier, the Larap Mines & Smelting Co., and the company's stockholders, but also on one by a surety company; and the fact that appellants did put up such bonds indicates that they admitted the definite existence of their obligation to pay the balance of P65,000.00.
The appellant have forfeited the right court below that the appellants have forfeited the right to compel Gaite to wait for the sale of the ore before receiving payment of the balance of P65,000.00, because of their failure to renew the bond of the Far Eastern Surety Company or else replace it with an equivalent guarantee. The expiration of the bonding company's undertaking on December 8, 1955 substantially reduced the security of the vendor's rights as creditor for the unpaid P65,000.00, a security that Gaite considered essential and upon which he had insisted when he executed the deed of sale of the ore to Fonacier.
(2) The sale between the parties is a sale of a specific mass or iron ore because no provision was made in their contract for the measuring or weighing of the ore sold in order to complete or perfect the sale, nor was the price of P75,000,00 agreed upon by the parties based upon any such measurement.(see Art. 1480, second par., New Civil Code). The subject matter of the sale is, therefore, a determinate object, the mass, and not the actual number of units or tons contained therein, so that all that was required of the seller Gaite was to deliver in good faith to his buyer all of the ore found in the mass, notwithstanding that the quantity delivered is less than the amount estimated by them.

Quiroga v. Parsons
Facts:
Plaintiff engaged into a contract for the exclusive sale of its beds with defendants. Plaintiff filed a complaint against the defendant for violation of the following obligations: not to sell the beds at higher prices than those of the invoices; to have an open establishment in Iloilo; itself to conduct the agency; to keep the beds on public exhibition, and to pay for the advertisement expenses for the same; and to order the beds by the dozen and in no other manner. Plaintiff alleged that the defendant was his agent.
Issue:
Whether the defendant, by reason of the contract hereinbefore transcribed, was a purchaser or an agent of the plaintiff for the sale of his beds
Held:
There was the obligation on the part of the plaintiff to supply the beds, and, on the part of the defendant, to pay their price. These features exclude the legal conception of an agency or order to sell whereby the mandatory or agent received the thing to sell it, and does not pay its price, but delivers to the principal the price he obtains from the sale of the thing to a third person, and if he does not succeed in selling it, he returns it. By virtue of the contract between the plaintiff and the defendant, the latter, on receiving the beds, was necessarily obliged to pay their price within the term fixed, without any other consideration and regardless as to whether he had or had not sold the beds. The words commission on salesused in clause (A) of article 1 mean nothing else, as stated in the contract itself, than a mere discount on the invoice price. The wordagency, also used in articles 2 and 3, only expresses that the defendant was the only one that could sell the plaintiff's beds in the Visayan Islands. With regard to the remaining clauses, the least that can be said is that they are not incompatible with the contract of purchase and sale.

Sigaya v. Maguiya
The question of whether or not a person is a purchaser in good faith is a factual matter that will generally be not delved into by this Court especially when the findings of the trial court on the matter were affirmed by the Court of Appeals (CA). Settled as this rule may be, petitioners now come before this Court seeking an exception to the general rule.
The facts are as follows:
Dionisia Alorsabes owned a three hectare land in Dao, Capiz, denominated as Lot 3603. In 1934, she sold a portion of the lot to Juanito Fuentes while the remainder was inherited by her children Paz Dela Cruz, Rosela Dela Cruz, and Consorcia Arroja (an adopted child), and a grandson, Francisco Abas, in representation of his deceased mother Margarita Dela Cruz. These four heirs executed an Extra-Judicial Settlement with Sale dated February 4, 1964 wherein Consorcia sold her share with an area of 6,694 square meters to spouses Balleriano Mayuga. On April 1, 1977, Paz also sold her share to Honorato de los Santos. Later, another document entitled Extra-Judicial Partition with Deed of Sale dated November 2, 1972 was uncovered wherein the heirs of Dionisia purportedly adjudicated Lot 3603 among themselves and sold their shares to Francisco. On January 9, 1978, Francisco executed a Deed of Sale over Lot 3603 in favor of Teodulfo Sigaya. Thus, the title over Lot 3603 was cancelled and a new one was issued in the name of Teodulfo, predecessor-in-interest of the petitioners herein.
On October 14, 1986, the petitioners, who are the widow and children of Teodulfo, filed Civil Case Nos. V-5325, V-5326, V-5327 and V-5328 for recovery of possession and damages against Diomer Mayuga, Honorato de los Santos, Sps. Jose Viva and Rosela Dela Cruz-Viva, and Renato Distor, respectively, before the Regional Trial Court (RTC) of Roxas City, Branch 16, praying that respondents be ordered to vacate Lot 3603, and turn over the same to petitioners; that petitioners’ right of ownership and possession over the property be confirmed and that respondents be ordered to pay damages in the form of unrealized income starting 1980, plus attorney’s fees and costs.
Respondents in their answers with counterclaim averred that: the Deed of Sale executed by Francisco in favor of Teodulfo and the title thereon are null and void for being based on a fictitious Extra-Judicial Settlement with Sale; Rosela Dela Cruz-Viva and Paz Dela Cruz, who are illiterates, were fraudulently made to sign as vendees in the Extra-Judicial Settlement with Sale dated 1972, when Francisco represented that they were merely signing as witnesses to the sale of Francisco of his share to Teodulfo. As counterclaim, they asked for attorney’s fees and damages. Respondent Mayuga further asserted that he possesses his portion of the property by virtue of the sale by Consorcia Arroja of her share to his parents, Sps. Balleriano Mayuga. Respondent de los Santos meanwhile averred that Paz Dela Cruz sold her share to him in 1957. Respondents Rosela Dela Cruz-Viva and her husband Jose Viva claimed that the portion of land occupied by them pertains to Rosela’s share which she inherited from Dionisia, while respondent Renato Distor claimed that his wife inherited said property from her father Juanito Fuentes, who in turn bought the same from Dionisia during her lifetime. The four cases were consolidated and on February 14, 1992, the trial court rendered its decision, the dispositive portion of which reads: WHEREFORE, judgment is hereby rendered as follows: 1. Declaring the defendants Geomer (sic) Mayuga as the real and absolute owner of the portion of land, containing an area of Six Thousand Six Hundred Ninety Four (6,694) square meters, more [or] less, portion of Lot No. 3603, Dao Cadastre and subject matter in Civil Case No. 5325 indicated in the Commissioner’s Report (Exh.”4”) as Exh. “4-B”; 2. Declaring the defendant Honorato de los Santos as the absolute owner of the portion of land containing an area of Six Thousand Six Hundred Ninety Five (6,695) square meters more or less, portion of lot No. 3603 Dao Cadastre, and subject matter in Civil Case No. 5326 indicated in the Commissioner’s Report (Exh. “4”) as Exh. “4-D”; 3. Declaring the defendants spouses Jose Viva and Rosela dela Cruz as the absolute owners of the portion of land containing an area of Six Thousand Six Hundred Ninety Four (6,694) square meters, more or less, portion of Lot No. 3603, Dao Cadastre, and subject matter in Civil Case No. 5327 indicated in the Commissioner’s Report (Exh. “4”) as Exh. “4-C”; 4. Declaring the defendant, Renato Distor, as the absolute owner of the portion of land containing an area of Six Thousand Three Hundred Forty Four (6,344) square meters, more or less, portion of Lot No. 3603, Dao Cadastre, and subject matter in Civil Case No. 5328 indicated in the Commissioner’s Report (Exh. “4”) as Exh. “4-E”; 5. Declaring the plaintiffs as the absolute owners of the portion of land containing an area of Seven Thousand Forty-Six (7,046) square meters, more or less, portion of Lot No. 3603, Dao Cadastre, indicated in the Commissioner’s Report (Exh. “4”) as Exh. “4-F”; 6. Declaring Transfer Certificate of Title No. T-15630 of the Register of Deeds of Capiz as null and void and should be cancelled; 7. Declaring that Deed of Sale, Exh. “C” as null and void except as affecting the portion with an area of Seven Thousand Forty Six (7,046) square [meters] of Lot 3603 which portion had been sold by Francisco Abas to the spouses Teodulfo Sigaya and Justina Cosipe; 8. Declaring that Extra-Judicial Partition with Deed of Sale as having been procured through fraud and therefore not valid in so far as the sale of the shares of Paz de la Cruz and Priscilla de la Cruz were concerned; 9. Condemning the plaintiffs to severally and jointly pay the following: a) Unto Diomar Mayuga, defendant in Civil Case No. V-5325, P10,000.00 as attorney’s fees and litigation expenses; b) Unto Honorato de los [Santos], defendant, in Civil Case No. V-5326, P10,000.00 as [attoney’s] fees and litigation expenses; c) Unto the (sic) Jose Viva and Rosela de la Cruz, defendants in Civil Case No. V-5327, P10,000.00 as [attorney’s] fees and litigation expenses; and d) Unto Renato Distor, defendant in Civil Case No. V-5328, P10,000.00 as [attorney’s] fees and litigation expenses; and e) Dismissing Civil Case Nos. V-5325, V-5326, V-5327 and V-5328 with costs in each case against the plaintiffs. SO ORDERED. The trial court explained that: There is no question that the deed of sale of the portion bought by Jacinto Fuentes from Dionisia Alorsabes and now possessed by defendants Renato Distor was a public instrument executed in 1934; and the portion occupied by defendant Diomer Mayuga is the portion bought by spouses Florentina Viva and Balleriano Mayuga from Consorcia Mayuga as her share in lot 3603; defendant Honorato de los Santos is in possession of the portion which he bought from Paz de la Cruz, in 1977, although he had been possessing this portion since May 15, 1957 by virtue of a private document of mortgage. (citations omitted) … In these cases, the court believes and so holds that the evidence of actual occupation and possession of the defendants of the portions of Lot 3603, to each of them appertaining had been satisfactorily proven. The defendants were not able to file any opposition to the reconstitution of title solely because they were not notified actually. They could not also be considered to have constructive notice because there was no publication of the Notice of Hearing of the petition. From the evidence taken together by its totality of evidence tilts more in favor of the defendants and against the plaintiffs. Not satisfied with the decision, petitioners went to the CA which affirmed, in its Decision promulgated on April 19, 2000, the ruling of the RTC except as to the award of attorney’s fees and expenses of litigation. It then disposed of the appeal as follows: WHEREFORE, premises considered, the decision of the court a quo is hereby AFFIRMED, with the modification that the awards of attorney’s fees and expenses of litigation to the defendants-appellants are hereby eliminated. SO ORDERED. The CA found: Looking at the evidence presented, the trial court considered the defendants-appellees as having proven the actual possession and validity of the possession of the lots in question. Against that, the plaintiffs- appellants put forward the TCT held by Teodulfo Sigaya, whose validity rests upon the ability of Francisco Abas to sell Lot 3603, which the TCT now covers, and that the sale to Teodulfo Sigaya was registered. Prior registration would protect an innocent purchaser in good faith and for value. But the plaintiffs-appellants cannot now claim the (sic) Teodulfo Sigaya was an innocent purchaser for value. The trial court gave more credence to the testimony of defendants-appellees and their witnesses that they had been in possession for a longer period of time, even before the sale to Teodulfo Sigaya in 1978. This issue of credibility requires a determination that is concededly best left to the trial court with its unique position of having been enabled to observe that elusive and incommunicable evidence of the deportment of witnesses on the stand. Findings of the trial court, following that assessment, must be given the highest degree of respect absent compelling reasons to conclude otherwise. Teodolfo (sic) Sigaya examined the land in question, and did so as a reasonably prudent man buying real property should. As the defendants-appellees were in possession before him, he should have questioned such and delved deeper into the title and right of Francisco Abas to sell the lot. Not having done so, he is not an innocent purchaser in good faith, and not entitled to protection under the Torrens system. It is clear that the title of Francisco Abas was obtained through fraud, thus further damaging the case of the plaintiffs-appellants, whose predecessor-in-interest should have probed beyond the title after examining the lot to be sold him. As held by the Supreme Court:

“xxx Having bought the land registered under the Torrens system from their vendors who procured title thereto by means of fraud, petitioners cannot invoke the indefeasibility of a certificate of title against the private respondent to the extent of her interest. The Torrens system of land registration should not be used as a means to perpetuate fraud against the rightful owner of real property. Registration to be effective, must be made in good faith. (Palanca vs. Registry of Lands, 43 Phil. 149 [1922]). Thus, it is a settled rule that the defense of indefeasibility of a certificate of title does not extend to a transferee who takes it with notice of the flaws in his transferor’s title. If at all, the petitioners only acquire the right which their vendors then had. (Ramos et al. vs. Direno, et al., 50 Phil. 786 [1927]). The plaintiffs-appellants’ contentions as to their ownership of the lot in question must then fail in the face of the principles laid down in jurisprudence. Petitioners now come before this Court on a petition for review under Rule 45 of the Rules of Court, raising the sole issue of: WHETHER A PERSON DEALING WITH A REGISTERED LAND CAN SAFELY RELY ON THE CORRECTNESS OF THE CERTIFICATE OF TITLE ISSUED THEREFOR. Petitioners argue that: Teodulfo, their predecessor-in-interest, purchased the subject property from Francisco, who was in possession of the Original Certificate of Title (OCT) No. RO-5841 (17205), a reconstituted copy of the original, in the name of Dionisia and of the Extra-Judicial Partition with Deed of Sale, dated November 2, 1972; relying on these instruments and after inspecting the land and seeing that nobody occupied the same, Teodulfo bought the land and had the title subsequently issued in his name; the fact that Teodulfo examined the lot does not give rise to the conclusion that he is not an innocent purchaser in good faith as adverted to by the CA; if indeed Abas committed fraud in acquiring said lot, Teodulfo is also a victim of misrepresentation; there was no evidence that Teodulfo and Francisco connived to defraud respondents; Teodulfo did not have actual knowledge of facts and circumstances that would impel him to make further inquiry; and as purchaser in good faith, Teodulfo enjoys the protection of the Torrens system. Respondents in their Comment meanwhile contend that: the petition failed to comply with the requirements of Rule 45 of the Rules of Court as respondents were not served a copy of the motion for extension of time; the issue in the present petition does not involve a question of law but entails only a review of the facts which cannot be done by this Court; in any case, Teodulfo relied on a title that is not in the name of his transferor, Francisco, but on its registered owner, Dionisia, who was already deceased at the time of the supposed sale to Teodulfo; since the right of the supposed transferor was not shown in the title but merely on a Deed of Extra-Judicial Settlement with Sale, which turned out irregular, it was incumbent upon Teodulfo to examine further the extent of the right of the supposed transferor and why there were a lot of occupants in the land in dispute; his failure to do so operates against his favor and those of his successors-in-interest.

The parties filed their respective memoranda. Petitioners, in their Memorandum, further aver that: Teodulfo is a purchaser in good faith having relied on OCT No. RO-5841 (17205) in the name of Dionisia and the Extra-Judicial Partition with Deed of Sale dated November 2, 1972 which shows that Francisco is the absolute owner of the lot; four years had elapsed from the date that the OCT was reconstituted and the time Teodulfo bought the property from Francisco and yet none of the respondents had registered their right in the property; the Extra-Judicial Settlement of Lot 3603 of the Cadastral Survey of Dao, Capiz with Sale dated February 4, 1964, on which respondents base their claims, was never registered with the Registry of Deeds; not having been registered, this will not affect the right of third persons who had no knowledge thereof; there was no circumstance that would put Teodulfo on his guard and in cases of double sales of real property, the ownership shall be awarded to the vendee who first registers the sale in good faith; Teodulfo is a resident of Zarraga, Capiz which is more than 50 kilometers from Dao, Capiz, thus Teodulfo could not have actual knowledge of facts and circumstances that would impel him to make further inquiry; the land was merely pointed to him by Francisco and from what he had seen, there was nothing that would arouse his suspicion. Meanwhile, respondents, in their Memorandum, contend that they were in possession of the property before Teodulfo; that Teodulfo should have probed deeper into the right of Francisco to sell said lot, and not having done so, he cannot be considered as a purchaser in good faith; and that the issue of credibility requires a determination that is best left to the trial court with its unique position of being able to observe the elusive and incommunicable evidence of the deportment of witnesses on the stand. Petitioners claim that they are raising before this Court the legal issue of: Whether a person dealing with a registered land can safely rely on the correctness of the Certificate of Title issued therefor. Contrary to what petitioners would like this Court to believe, the resolution of the present petition hinges principally on the determination of a question of fact and not one of law. Both parties concede that a purchaser in good faith can safely rely on the four corners of a Torrens Title. The disagreement lies, however, as to whether or not Teodulfo should be considered as a purchaser in good faith and thus enjoy the protection of the Torrens system. Indeed, this question is one of fact and not one of law. There is a question of fact when the doubt or difference arises as to the truth or the falsity of the statement of facts while a question of law exists when there is doubt or controversy as to what the law is on a certain state of facts. The determination of whether Teodulfo is a buyer in good faith is a factual issue which is generally outside the province of this Court to determine in a petition for review If for this matter alone, the petition should be dismissed because the remedy of appeal by certiorari under Rule 45 of the Rules of Court contemplates only questions of law. Indeed, this Court is not a trier of facts,and the factual findings of the CA are binding and conclusive upon this Court, unless: (1) the conclusion is a finding grounded entirely on speculation, surmise and conjecture; (2) the inference made is manifestly mistaken; (3) there is grave abuse of discretion; (4) the judgment is based on a misapprehension of facts; (5) the findings of fact are conflicting; (6) the Court of Appeals went beyond the issues of the case and its findings are contrary to the admissions of both appellant and appellees; (7) the findings of fact of the Court of Appeals are contrary to those of the trial court; (8) said findings of fact are conclusions without citation of specific evidence on which they are based; (9) the facts set forth in the petition as well as in the petitioner's main and reply briefs are not disputed by the respondents; and (10) the findings of fact of the Court of Appeals are premised on the supposed absence of evidence and contradicted by the evidence on record. The binding effect of the CA’s factual findings on this Court applies with greater force when both the trial court and the CA are in complete agreement on their factual findings. It is also settled that absent any circumstance requiring the overturning of the factual conclusion made by the trial court, particularly if affirmed by the CA, the Court necessarily upholds such findings of fact. In this case, petitioners failed to show that they fall under any of the exceptional circumstances. In reaching its conclusion, the trial court gave weight to the testimonies of Engineer Jesus Pimentel, a geodetic engineer commissioned by the court to conduct a survey of the land, who found that respondents acquired their respective lots through sale or inheritance; of Rolly Daniel, a barangay official who lived 50 meters from said lot, who said that respondents had been in possession of their respective lots even before 1960 and that Teodulfo and Francisco asked him to accompany them sometime between 1976 to 1978 as they went to the different houses of respondents because Teodulfo was going to buy Francisco’s share; of Ursula Abas, wife of Francisco, who said that Francisco committed suicide after it was discovered that he fraudulently sold the portion belonging to his aunts to Teodulfo by making them sign a prepared document on the pretext that they were only signing as witnesses to the sale of his share, when in fact said document also sold their aunts’ shares; as well as the testimonies of Prudencio Fuentes, son of Jacinto and brother-in-law of respondent Renato Distor; Lourdes Distor, wife of Renato; Florentina Mayuga, mother of Diomer; and respondents Renato Distor, Honorato de los Santos, Rosela Dela Cruz-Viva who asserted that they have been in possession of said lots before the purported sale to Teodulfo. Petitioners, meanwhile, could only present Fely Sigaya and Cesar de los Santos. Fely testified that: the land was acquired by her father from Francisco by virtue of a Deed of Sale dated January 9, 1978 and that Francisco became the owner of the property by virtue of an Extra-Judicial Partition with Deed of Sale; when her father bought the property, he showed the documents to a lawyer who said that the same were in order; when her father visited the property, he found no occupants thereat; her father also filed a petition in 1974 for reconstitution of title of Lot 3603 thus a reconstituted title was issued in the name of Dionisia Alorsabes. Cesar, petitioners’ caretaker meanwhile, merely corroborated Fely’s testimony. This Court has held that the burden of proving the status of a purchaser in good faith lies upon one who asserts that status and this onus probandi cannot be discharged my mere invocation of the legal presumption of good faith. In this case, the Court finds that petitioners have failed to discharge such burden.
A purchaser in good faith is one who buys property without notice that some other person has a right to or interest in such property and pays its fair price before he has notice of the adverse claims and interest of another person in the same property. The honesty of intention which constitutes good faith implies a freedom from knowledge of circumstances which ought to put a person on inquiry. As enunciated in Lim vs. Chuatoco …good faith consists in the possessor's belief that the person from whom he received the thing was the owner of the same and could convey his title. Good faith, while it is always to be presumed in the absence of proof to the contrary, requires a well founded belief that the person from whom title was received was himself the owner of the land, with the right to convey it. There is good faith where there is an honest intention to abstain from taking any unconscientious advantage from another. Otherwise stated, good faith is the opposite of fraud and it refers to the state of mind which is manifested by the acts of the individual concerned. Indeed, it is a well-settled rule that every person dealing with registered land may safely rely on the correctness of the certificate of title issued therefor and the law will in no way oblige him to go beyond the certificate to determine the condition of the property. Where there is nothing in the certificate of title to indicate any cloud or vice in the ownership of the property, or any encumbrance thereon, the purchaser is not required to explore further than what the Torrens Title upon its face indicates in quest for any hidden defects or inchoate right that may subsequently defeat his right thereto. However, this rule shall not apply when the party has actual knowledge of facts and circumstances that would impel a reasonably cautious man to make such inquiry or when the purchaser has knowledge of a defect or the lack of title in his vendor or of sufficient facts to induce a reasonably prudent man to inquire into the status of the title of the property in litigation. In this case, preponderance of evidence shows that respondents had been in actual possession of their respective portions even prior to 1960. Rolly Daniel, which the trial court considered as a credible witness, testified that not only were respondents in actual possession of their respective portions prior to 1960, he even accompanied Francisco and Teodulfo to the different houses of respondents sometime between 1976 to 1978 as Teodulfo was going to buy the portion of Francisco. This Court cannot give credence therefore to the claim of petitioners that Teodulfo found no occupants in the property. There being occupants of the property, the Court cannot ascribe good faith to Teodulfo who has not shown any diligence in protecting his rights.
As the Court has stated: A purchaser cannot simply close his eyes to facts which should put a reasonable man on his guard and then claim that he acted in good faith under the belief that there was no defect in the title of his vendor. His mere refusal to believe that such defect exists or his willful closing of his eyes to the possibility of the existence of a defect in his vendor’s title will not make him an innocent purchaser for value if it later develops that the title was in fact defective, and it appears that he would have notice of the defect had he acted with that measure of precaution which may reasonably be required of a prudent man in a similar situation. (Emphasis supplied) Petitioners also argue that the rule on double sale of real property should apply in this case, and since they are the first to register the sale in good faith, they are entitled to be awarded ownership thereof. The Court disagrees. Apart from the fact that Teodulfo is not a purchaser in good faith, the law on double sales as provided in Art. 1544 of the Civil Code contemplates a situation where a single vendor sold one and the same immovable property to two or more buyers. For the rule to apply, it is necessary that the conveyance must have been made by a party who has an existing right in the thing and the power to dispose it. The rule cannot be invoked where the two different contracts of sale are made by two different persons, one of them not being the owner of the property sold. In this case, respondents derive their right over their respective portions either through inheritance or sale from Dionisia while petitioners’ invoke their right from the sale of the land from Francisco. Clearly, the law on double sales does not apply here. WHEREFORE, the petition is DENIED for lack of merit and the decision of the Court of Appeals is AFFIRMED. SO ORDERED.

VILLONCO REALTY V. BORMAHECO
FACTS:
Francisco Cervantes of Bormaheco Inc. agrees to sell to Villonco Realty a parcel of land and its improvements located in Buendia, Makati.
Bormaheco made the terms and condition for the sale and Villonco returned it with some modifications.
The sale is for P400 per square meter but it is only to be consummated after respondent shall have also consummated purchase of a property in Sta. Ana, Manila. Bormaheco won the bidding for the Sta.Ana land and subsequently bought the property.
Villonco issued a check to Bormaheco amounting to P100,000 as earnest money. 26 days after signing the contract of sale, Bormaheco returned the P100,000 to Villonco with 10% interest for the reason that they are not sure yet if they will acquire the Sta.Ana property.
Villonco rejected the return of the check and demanded for specific performance.

ISSUE:
WON Bormaheco is bound to perform the contract with Villonco.

HELD:
The contract is already consummated when Bormaheco accepted the offer by Villonco. The acceptance can be proven when Bormaheco accepted the check from Villonco and then returned it with 10% interest as stipulated in the terms made by Villonco.
On the other hand, the fact that Villonco did not object when Bormaheco encashed the check is a proof that it accepted the offer of Bormaheco.
Whenever earnest money is given in a contract of sale, it shall be considered as part of the price and as proof of the perfection of the contract" (Art. 1482, Civil Code).

LAWYERS COOPERATIVE PUBLISHING COMPANY V. PERFECTO A. TABORA
G.R. No. L-21263 April 30, 1965
Facts:
Perfecto A. Tabora (buyer) bought from the Lawyers Cooperative PublishingCompany(seller) one complete set of American Jurisprudence consisting of 48 volumes with 1954 pocket parts, plus one set of American Jurisprudence,General Index, consisting of 4 volumes, for a total price of P1,675.50 which, in addition to the cost of freight of P6.90, makes a total of P1,682.40. Tabora made a partial payment of P300.00, leaving a balance of P1,382.40. The books were duly delivered and receipted for by Tabora on May 15, 1955 in his law office in Naga City.
However, a big fire broke out in that locality which destroyed and burned all the buildings standing on one whole block including at the law office and library of Tabora.
As a result, the books bought from the company as above stated, togetherwith Tabora's important documents and papers, were burned during theconflagration.
This unfortunate event was immediately reported by Tabora to the company in a letter he sent on May 20, 1955. On May 23, the company replied and as a token of goodwill it sent to Tabora free of charge volumes 75, 76, 77 and 78 of the Philippine Reports.
As Tabora failed to pay he monthly installments agreed upon on the balance of the purchase price notwithstanding the long time that had elapsed, the company demanded payment of the installments due, and having failed, to pay the same, it commenced the present action before the CFI of Manila for the recovery of the balance of the obligation.
Defendant, in his answer, pleaded force majeure as a defense. He alleged that the books bought from the plaintiff were burned during the fire that broke out in Naga City on May 15, 1955, and since the loss was due to force majeure he cannot be held responsible for the loss.
CFI rendered judgment for the plaintiff. It ordered Tabora to pay the sum of P1,382.40, with legal interest thereon from the filing of the complaint, plus a sum equivalent to 25% of the total amount due as liquidated damages, and the cost of action.
Tabora appealed to the CA, but the case was forwarded to the SC by virtue of a certification issued by the CA that the case involves only questions of law.
Issue:
W/N respondent Tabora should bear the loss and pay the unpaid purchase price.
Ratio: YES. It was provided in the contract that
"title to and ownership of the booksshall remain with the seller until the purchase price shall have beenfully paid. Loss or damage to the books after delivery to the buyer shall be borne by the buyer."
General Rule: the loss of the object of the contract of sale is borne by the owner, or in case of force majeure the one under obligation to deliver the object is exempt from liability. BUT, this rule does not apply in this casebecause the parties clearly agreed to the abovementioned contrary

VILLARTA V. CA (May 29, 1987)
FACTS:
Respondent Rosalinda Cruz entrusted to petitioner Victoria Villarta seven pieces of jewelry on November 1968. On December of the same year, Villarta exchanges one jewelry to another and issued a post-dated check in favor of Cruz. Cruz deposited the check but it was dishonored for lack of funds.

An estafa case was filed against Villarta but she argued that she can only be civilly liable because even though the check bounced, she only gave it for a pre-existing obligation. She contends a person cannot be imprisoned for non-payment of debt.

ISSUE:
WON the transaction is a “sale or return”

HELD:
The transaction is not a sale or return but a sale on approval or sale on acceptance.
When Cruz gave the jewelry to Villarta on November, the clear intention is to make the latter choose which item she wanted to buy. There was no meeting of the minds yet at this point and hence, it cannot be considered as delivery.
If ownership over the jewelry was not transmitted on that date, then it could have been transmitted only in December 1968, the date when the check was issued. In which case, it was a "sale on approval" since ownership passed to the buyer. Vallarta, only when she signified her approval or acceptance to the seller, Cruz, and the price was agreed upon.
It is still criminal fraud or deceit in the issuance of a check which is made punishable under the Revised Penal Code, and not the non-payment of the debt.

Cuison v. Remoto
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, 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. 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. 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.

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 attorney’s fees; and
4) To pay the costs (sic) of suit.

Done in Chambers this 9th day of March, 1990, at Butuan City, Philippines. 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 one—paged 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 defendants-spouses (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., 274-275). 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, defendants-spouses 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.
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 Decision 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. Petitioners filed a motion for reconsideration but the CA denied it per Resolution dated March 31, 2000. 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. 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. 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. 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. 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. Records bear the fact that when Placida sold her one-fourth portion of the property covered by TCT No. RT-183 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 Placida’s 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. 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. 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 Encarnacion’s 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. 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 court’s finding considering that it was in the best position to assess the respective testimonies of the contending claimants. 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. Such being the case, the heirs of Placida did not acquire any right to adjudicate the property unto them and sell it to Encarnacion. What’s 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. 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 Placida’s original co-owners, namely, Eugenio Tabada, Raymunda Tabada and Patrecia Tabada, and their respective heirs, 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. 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. 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 Placida’s co-owners have already been exercising proprietary rights over their respective allotments. Thus, inscribed on TCT No. RT-183 are several deeds of mortgages executed by Placida’s 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 Eugenio’s one-fourth portion of the property. 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 Placida’s pro indiviso share in the property, and Angel gets only what corresponds to Placida’s 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 co-owner/seller are transferred, thereby making the buyer a co-owner of the property. 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 Placida’s 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.
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 Extra-Judicial 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.…...

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