G.R. No. 241330, December 05, 2022
Emerson P. Valenzuela, Valentino P. Valenzuela, and Marty P. Valenzuela, Petitioners, vs. Sps. Danilo Pabilani and Eleonor Pabilani, Sps. Leticia and Joseph Mattingly, Respondents.

FACTS

The subject property, a 180-square meter parcel of land with a house in Makati City, was originally registered under OCT No. 706 in the names of spouses Felix and Candida Valenzuela. Petitioners and respondent Leticia Valenzuela-Mattingly are their children. Petitioners alleged that in October 2006, Leticia fraudulently purchased the property from their parents through a Deed of Absolute Sale (DOAS), which was notarized on October 26, 2006. They claimed the DOAS was falsified because their mother Candida had already died on March 3, 2006, and their father Felix was paralyzed and near death, dying on November 7, 2006. TCT No. 223017 was issued in Leticia’s name. On February 24, 2010, Leticia sold the property to Spouses Pabilani, and TCT No. 227394 was issued in their names. The Spouses Pabilani then evicted petitioners. Petitioners filed a Complaint for Annulment of Titles, Reconveyance and Damages, also asserting that an adverse claim filed by petitioner Emerson on July 16, 2009, was fraudulently cancelled on March 22, 2010. The Regional Trial Court (RTC) ruled in favor of petitioners, declaring the DOAS null and void ab initio and the subsequent titles void. The Court of Appeals (CA) reversed the RTC and dismissed the complaint, holding that forgery was not sufficiently proven, that the death of Candida made her signature unnecessary for the validity of the DOAS, and that the Spouses Pabilani were buyers in good faith.

ISSUE

1. Whether the CA committed reversible error in reversing the RTC and dismissing the complaint.
2. Whether the CA erred in holding that Candida’s falsified signature would only have legal significance if she did not approve of the sale.
3. Whether the CA erred in holding that the private respondents are in good faith.

RULING

The Supreme Court DENIED the petition and AFFIRMED the CA Decision.
1. The CA correctly reversed the RTC. The petitioners failed to prove by clear, positive, and convincing evidence that the DOAS was falsified or that their parents did not intend to be bound by it. The claim of forgery cannot be presumed. The death of Candida terminated the conjugal partnership, making Felix the sole owner of his share, and Candida’s signature was not indispensable for the validity of the sale of Felix’s share. The alleged defects in the notarization of the DOAS did not render the underlying contract void but merely affected its public document status, making it enforceable only between the parties as a private instrument.
2. The CA did not err. The petitioners’ argument focused on the falsity of the signature but not on the lack of Candida’s consent to the sale. The Court found the evidence showed Candida was alive and consented to the sale, as the parties themselves deemed her signature necessary, and private respondents presented a video showing the family’s gratitude to Leticia for paying off a loan on the property, which was the consideration for the sale.
3. The CA correctly held the Spouses Pabilani were buyers in good faith. They were not parties to the DOAS between Leticia and her parents. As innocent purchasers for value, they relied on the clean title presented by Leticia and the cancellation of the adverse claim by the Register of Deeds, which carries a presumption of regularity. The mere existence of a prior adverse claim, which was subsequently cancelled, does not automatically make them buyers in bad faith. They had no participation in the alleged forgery and were not required to investigate beyond the certificate of title.