G.R. No. 115101 March 2, 1998
FIDELA MANANZALA, petitioner, vs. COURT OF APPEALS, and CORAZON ARAÑEZ, respondents.

FACTS

Petitioner Fidela Mananzala is the registered owner of a parcel of land in Quezon City. She had been in possession since 1955 under a conditional sale from the PHHC (later NHA). In 1960, the PHHC awarded the same land to the Mercado spouses, but petitioner successfully contested this award in court, leading to the cancellation of the Mercado award. Petitioner paid the full price to the NHA in December 1984, and a deed of sale and Transfer Certificate of Title were issued in her name in January 1985. On January 31, 1985, private respondent Corazon Arañez filed an action for specific performance to enforce a deed of sale allegedly executed between her and petitioner on March 22, 1960, which stipulated that title would be transferred to Arañez within 30 days after petitioner’s full payment to the PHHC. Petitioner denied selling the land, contended the deed was a forgery or her signature was obtained by fraud, and alternatively argued the sale was void because it was made before the actual award to her and violated PHHC rules prohibiting disposition within one year of title issuance. The trial court dismissed the complaint, finding the signature genuine but ruling no perfected contract of sale due to lack of intent to sell and that the contract was void because petitioner was not yet the owner at the time of sale. The Court of Appeals reversed, holding there was a meeting of the minds evidenced by the genuine signature, upheld the presumption of regularity from notarization, and ruled petitioner could validly sell the land even before award under Article 1461 of the Civil Code regarding things with potential existence. It ordered petitioner to transfer ownership to Arañez.

ISSUE

1. Whether the Court of Appeals erred in relying on the presumption of regularity accorded to notarial documents to hold the deed of sale valid.
2. Whether the contract between petitioner and private respondent is valid and binding.

RULING

1. The Court of Appeals did not err. It did not rely solely on the presumption of regularity from notarization. It also considered the evidence, including the NBI report finding petitioner’s signature on the deed to be genuine, a factual finding concurred in by the trial court. Petitioner’s claim of fraud was contradicted by her allegation in court that the signature was not hers. The genuineness of the signature is a factual finding binding on the Supreme Court.
2. The contract is valid and binding. Petitioner’s argument that the sale violated PHHC rules (like the one-year prohibition on disposition after title issuance) was not passed upon by the lower courts. While raised in her answer, she did not urge this ground on appeal to the Court of Appeals, effectively waiving it. The appellate court properly addressed the issues actually raised: forgery, meeting of the minds, and sale of future property. The sale of a thing with a potential existence (the lot before its award) is permitted under Article 1461 of the Civil Code. The decision of the Court of Appeals is AFFIRMED.