GR 102377; (July, 1996) (Digest)
G.R. No. 102377 July 5, 1996
ALFREDO SAJONAS and CONCHITA SAJONAS, petitioners, vs. THE COURT OF APPEALS, DOMINGO A. PILARES, SHERIFF ROBERTO GARCIA OF QUEZON CITY and REGISTER OF DEEDS OF MARIKINA, respondents.
FACTS
Spouses Ernesto Uychocde and Lucita Jarin, registered owners of a parcel of land, agreed to sell the property to spouses Alfredo and Conchita Sajonas (petitioners) under a Contract to Sell dated September 22, 1983. The petitioners caused the annotation of an adverse claim on the title on August 27, 1984. Upon full payment, a Deed of Absolute Sale was executed on September 4, 1984, but registered only on August 28, 1985. Meanwhile, Domingo Pilares (private respondent) had a money judgment against Ernesto Uychocde. Pursuant to a writ of execution, a notice of levy was annotated on the Uychocdes’ title on February 12, 1985. When the petitioners registered their deed, a new title was issued in their name, but the notice of levy was carried over.
ISSUE
Whether the notice of levy on execution, annotated after the execution of the deed of absolute sale in favor of the petitioners but before its registration, is superior to the petitioners’ right as buyers in good faith, thereby justifying its cancellation from their title.
RULING
The Supreme Court ruled in favor of the petitioners and ordered the cancellation of the notice of levy. The Court applied Section 70 of Presidential Decree No. 1529 (Property Registration Decree), which states that the recording of an adverse claim is effective for thirty days and “may be canceled by filing with the register of deeds a verified petition for cancellation.” The Court rejected the appellate court’s interpretation that an adverse claim automatically loses force after thirty days. Instead, it held that the provision means the claim remains effective until a petition for its cancellation is filed and granted. The petitioners’ adverse claim, annotated in August 1984, was still in effect when the levy was annotated in February 1985. Therefore, the levy was subject to the petitioners’ prior interest. The petitioners were purchasers in good faith for value, and their registration of the deed related back to the date of the annotation of their adverse claim, giving them priority over the subsequent levy. The Torrens system protects a purchaser in good faith, and the levy, being subsequent and subordinate to the petitioners’ vested right, was improperly carried over to their new title.