GR 147468; (April, 2003) (Digest)
G.R. No. 147468; April 9, 2003
SPOUSES EDUARDO ARENAS DOMINGO & JOSEFINA CHAVEZ DOMINGO, petitioners, vs. LILIA MONTINOLA ROCES, CESAR ROBERTO M. ROCES, ANA INES MAGDALENA ROCES TOLENTINO, LUIS MIGUEL M. ROCES, JOSE ANTONIO M. ROCES and MARIA VIDA PRESENTACION ROCES, respondents.
FACTS
The spouses Cesar and Lilia Roces owned two parcels of land. After Cesar’s death, Reynaldo Montinola, Lilia’s nephew, fraudulently executed an affidavit of self-adjudication claiming he was the sole heir, falsely alleging Lilia’s death. Using this affidavit, Montinola obtained title and subsequently sold one property to the petitioner spouses, Eduardo and Josefina Domingo. The Torrens titles issued to Montinola and later to the Domingos contained an annotation referencing Section 4, Rule 74 of the Rules of Court concerning the estate of the deceased Roces spouses. The legitimate heirs, respondents Lilia Roces (who was alive) and her children, filed a complaint to annul the affidavit, the sale, and the resulting titles.
ISSUE
Whether the petitioners were innocent purchasers for value, protected by the Torrens system, despite the annotation on their title regarding Section 4, Rule 74.
RULING
No, the petitioners cannot be considered innocent purchasers for value. The Supreme Court affirmed the Court of Appeals’ decision annulling the documents and titles. The legal logic is clear: the annotation on the title referencing Section 4, Rule 74 constituted a direct warning and a legal encumbrance. This provision governs summary settlement of estates and serves as a caveat to prospective buyers that the property is involved in a succession, and the seller’s ownership may be defective or subject to the claims of other heirs. A purchaser cannot simply ignore such an annotation and still claim good faith. The Court emphasized that one who buys real property registered under the Torrens system is charged with notice of the burdens and claims annotated on the title. By proceeding with the purchase despite this explicit annotation, the petitioners were not purchasers in good faith. Furthermore, the Court found no laches on the part of the respondents, as they filed their action promptly after discovering the fraudulent sale.