G.R. No. 208264, July 27, 2016
OFFICE OF THE OMBUDSMAN, Petitioner, vs. RICO C. MANALASTAS, Respondent.

FACTS

This administrative case stemmed from a fraudulent loan transaction. Marian Dy Tiu applied for a loan from BPI Family Savings Bank, using a property titled under her husband, Paquito Tiu, as collateral. She presented a forged Owner’s Duplicate Certificate of Title (TCT No. 1035) and a person impersonating Paquito to sign the loan and mortgage documents. BPI Family’s personnel then presented these documents to the Office of the Register of Deeds of San Juan City for registration. Respondent Rico C. Manalastas, an Examiner, examined the documents, assessed fees, entered the mortgage in the registration book, and endorsed the documents to his superiors, who subsequently signed them. The bank released the loan proceeds. The fraud was discovered only when the real Paquito Tiu appeared at the bank, disavowing the transaction and presenting his genuine duplicate title.
The Office of the Ombudsman found Manalastas and two other registers of deeds guilty of Gross Negligence and imposed a one-year suspension without pay. The Ombudsman held they failed in their duty to detect the fake title by comparing it with the original on file. The Court of Appeals reversed the Ombudsman’s ruling, absolving Manalastas. It held that he enjoyed the presumption of regularity in his duties and that the bank’s own failure to verify the identities and documents was the proximate cause of its loss. The Office of the Ombudsman elevated the case to the Supreme Court via a petition for review on certiorari.

ISSUE

Whether or not respondent Manalastas, as an Examiner of Deeds, is administratively liable for Gross Negligence in the performance of his duties in relation to the registration of the fraudulent real estate mortgage.

RULING

The Supreme Court denied the petition and affirmed the Court of Appeals’ decision, absolving Manalastas of administrative liability. The Court clarified that the duty of an Examiner of Deeds under the Land Registration Act and subsequent laws is primarily ministerial. His function is to examine documents presented for registration for completeness—checking whether they are in proper form, contain necessary averments, and are accompanied by the correct fees. The law does not impose upon him the duty to investigate the authenticity of signatures or to ascertain the genuineness of a title beyond its facial regularity. The Court emphasized that the system of registration relies on the integrity of documents presented, and the examiner is not an insurer of their validity.
The Court found no gross negligence. Manalastas performed his specific ministerial tasks: he checked the document’s form, assessed fees, made the entry, and forwarded it. The fake title was sophisticated, printed on an official LRA form, making its detection difficult upon mere examination. The proximate cause of the bank’s loss was its own failure to exercise due diligence in verifying the identity of the impostor and the authenticity of the signatures during the loan approval process, which occurred before the documents reached the Registry. Without proof of bad faith or participation in the fraud, and with the presumption of regularity in the performance of official duty standing unrebutted, no administrative liability attaches to Manalastas for the fraudulent registration.