G.R. No. 147559; June 27, 2008
ARMED FORCES AND POLICE MUTUAL BENEFIT ASSOCIATION, INC., petitioner, vs. INES BOLOS SANTIAGO, respondent.

FACTS

Petitioner AFP-MBA obtained a writ of preliminary attachment against EBR Realty Corporation. The corresponding Notice of Levy was presented for registration on September 14, 1994, and entered in the Primary Entry Book. However, the Registry of Deeds could not annotate it on the original TCT because the title was unavailable. Six days later, a Deed of Absolute Sale dated February 24, 1994, executed by EBR Realty in favor of respondent Ines Santiago, was presented and registered, resulting in the issuance of a new TCT in her name. The Register of Deeds discovered the error and requested Santiago to surrender her title for annotation of the prior levy, but she refused.
The Register of Deeds consulted the Land Registration Authority (LRA) on whether he could annotate the levy on Santiago’s new title. The LRA ruled that a court order was necessary. The Court of Appeals affirmed this, holding that annotating the levy on Santiago’s title would be premature and would presume her bad faith, a judicial issue.

ISSUE

Whether the Register of Deeds can annotate the notice of levy on attachment on the new title issued to respondent Santiago without a court order.

RULING

The Supreme Court reversed the Court of Appeals and ordered the annotation. The legal logic is anchored on the principle that registration in the Primary Entry Book constitutes effective registration for purposes of establishing a lien. Under Section 51 of Presidential Decree No. 1529, the act of registration is deemed complete upon entry in the primary book. The notice of levy was entered on September 14, 1994, which was six days before the deed of sale was presented. Therefore, the attachment lien was registered first and attached to the property at that moment, binding all subsequent transferees.
The Court clarified that the annotation on the new title is not an alteration or a determination of Santiago’s status as a buyer in bad faith; it is merely a ministerial act of carrying over an existing, duly registered encumbrance to the derivative certificate of title. The refusal of the registered owner to surrender the owner’s duplicate certificate does not invalidate the lien nor prevent its annotation on the original copy on file with the registry. However, because Santiago refused to surrender her duplicate title, a court order is necessary under the circumstances to compel its surrender for the proper annotation, ensuring the integrity of the Torrens system. The Register of Deeds was thus ordered to annotate the levy on the original copy of the title.