G.R. No. L-7206; January 27, 1913
SIXTO PANTOJA, plaintiff-appellant, vs. CLARO PALENCIA, defendant-appellee.

FACTS

Catalino Pantoja owed Claro Palencia P215 as rent for leased land. Palencia obtained a judgment against Catalino and, in execution, four parcels of land were sold at public auction to Palencia. Sixto Pantoja intervened, claiming ownership of the four parcels by virtue of a notarial deed of sale executed in his favor by Catalino Pantoja one year before the auction. Palencia attacked the deed as forged and executed in fraud of creditors. The Court of First Instance of Albay absolved Palencia, finding the sale suspicious because: Sixto likely did not have the purchase price; Sixto did not appear as a witness; the deed was not registered; and it was executed at a time when forging notarial documents to avoid execution was easy. Sixto appealed.

ISSUE

Whether the notarial deed of sale executed by Catalino Pantoja in favor of Sixto Pantoja is valid and effective against Palencia, a judgment creditor.

RULING

Yes. The Supreme Court reversed the trial court’s judgment. The notarial instrument enjoys the presumption of validity, and its falsity was not proven. Lack of registration does not prove forgery, as registration is not generally required for validity. The insolvency of a debtor or the existence of creditors does not invalidate a sale of unencumbered property. The vendee’s (Sixto’s) failure to testify is not detrimental, especially since he was examined before the justice of the peace prior to the attachment. The claim of lack of consideration was not proven; Sixto testified he was also a creditor and the sale was in payment of his credit. The fact that Palencia was a creditor before the sale does not prevent the debtor from selling his property, especially since Palencia’s judicial claim arose months after the sale. The deed is valid, and the relief prayed for in the complaint should be granted.