GR L 54009; (October, 1983) (Digest)
G.R. No. L-54009 October 28, 1983
VALLEY GOLF CLUB, INC., petitioner, vs. HON. EMILIO SALAS, Presiding Judge, Branch 1, CFI of Rizal, MAGDALENA MASANGKAY, REMEDIOS MASANGKAY, GLORIA MASANGKAY, NATIVIDAD MASANGKAY, ESPERANZA MASANGKAY, MANUEL VILLAMOR, MODESTA GARCIA, ROMEO F. ROMERO and LOURDES G. RODRIGUEZ, respondents.
FACTS
The Masangkay sisters, owners of a parcel of land, executed a Deed of Extrajudicial Partition with Sale in favor of Manuel Villamor on January 28, 1955. Villamor sold the property to Romeo Romero the next day. The titles were subsequently transferred, culminating in TCT No. 38153 in the name of the Romeros. In October 1960, Romero negotiated to sell the land to petitioner Valley Golf Club. On October 25, 1960, Remedios Masangkay filed an Affidavit of Adverse Claim on the title, alleging the prior sale was simulated. On October 26, the Club paid Romero. On October 27, the sisters filed an action to annul the sales (Civil Case No. 6365) and a notice of lis pendens was annotated on the title. That same afternoon, the Club attempted to register its deed of sale from Romero but withdrew upon discovering the annotations.
The trial court in Civil Case No. 6365 declared the sales to Villamor and Romero null and void for lack of consideration, a decision affirmed by the Court of Appeals and this Court. During the pendency of the appeal, the Club registered its deed in 1963, securing TCT No. 118406, which carried over the annotations of the adverse claim and lis pendens. In 1974, the Club filed the present action for quieting of title, seeking to cancel these annotations.
ISSUE
Whether petitioner Valley Golf Club is a purchaser in good faith and for value, entitled to have its title quieted against the claims of the Masangkay sisters.
RULING
No. The Supreme Court affirmed the dismissal of the complaint for quieting of title. The Club cannot be considered a purchaser in good faith. Its attempt to register the deed of sale occurred on October 27, 1960, after the annotations of the Affidavit of Adverse Claim and the notice of lis pendens had already been made on Romero’s title. By virtue of the lis pendens, the Club’s acquisition was expressly subject to the outcome of Civil Case No. 6365, which ultimately voided Romero’s title. The Club was charged with knowledge of the flaws in the title from the moment of these prior annotations. Its inaction for years, despite this knowledge, further negated any claim of good faith. Consequently, the final judgment in favor of the Masangkay sisters prevails over the Club’s derivative title.
The Court, however, ruled that the Romeros, who received the full purchase price from the Club for a property they had no right to sell, must refund the amount of P69,887.50 with interest. The principle against unjust enrichment applies, and the Club’s cause of action for reimbursement accrued upon the failure of its action to quiet title. The dismissal of the complaint against the sisters is affirmed, but with an order for the Romeros to make restitution.