G.R. No. L-18497 May 31, 1965
DAGUPAN TRADING COMPANY, petitioner, vs. RUSTICO MACAM, respondent.

FACTS

In 1955, Sammy Maron and his seven siblings were pro-indiviso owners of an unregistered parcel of land. While their application for land registration under Act No. 496 was pending, they executed two deeds of sale on June 19 and September 21, 1955, conveying the property to respondent Rustico Macam. Macam took possession and introduced substantial improvements. On October 14, 1955, Original Certificate of Title No. 6942 was issued in the names of the Maron siblings, free from all liens and encumbrances. On August 4, 1956, by virtue of a final judgment against Sammy Maron in favor of Manila Trading and Supply Company, a levy was made upon whatever interest he had in the property, and that interest was sold at public auction to the judgment creditor. The notice of levy, certificate of sale, and sheriff’s certificate of final sale were duly registered. On March 1, 1958, Manila Trading and Supply Company sold all its rights to the property to petitioner Dagupan Trading Company.

ISSUE

Who has the better right between petitioner Dagupan Trading Company and respondent Rustico Macam to the one-eighth share of Sammy Maron in the subject property?

RULING

The Supreme Court ruled in favor of respondent Rustico Macam. The Court held that at the time of the levy on Sammy Maron’s share, he had no remaining interest in the property as it had already been fully conveyed to Macam prior to both the registration of the land and the levy. The subsequent levy and execution sale were therefore void. The Court emphasized that the unregistered sale in favor of Macam, coupled with his possession and introduction of improvements, established his ownership under the Civil Law, which could not be defeated by the subsequent registration of the land and the technical registration of the execution sale proceedings. The decision of the Court of Appeals affirming the dismissal of Dagupan Trading Company’s complaint was affirmed.