G.R. No. L-25147 May 29, 1970
ANGELINA MAQUILING, represented by her guardian ad litem CARLOS MAQUILING, petitioner, vs. MONSERRAT UMADHAY, MANUEL UMADHAY, CRISANTA S. GUMBAN, and THE HONORABLE COURT OF APPEALS, respondents.

FACTS

The disputed property is part of Lot 3092, originally owned in common by seven persons. Paz Maquiling owned a 2/7 share. Upon her death, her three children—Eriberto, Carmen, and Enrique Gumban—inherited her share. Enrique sold his 1/3 interest to Angelina Maquiling in 1947, but this sale was not registered. Angelina was later declared insane, with Carlos Maquiling appointed as her guardian. In 1950, Eriberto Gumban, Jr. executed an affidavit adjudicating to himself the entire 2/7 share of Paz Maquiling, claiming to be her sole heir, and mortgaged the entire share to Monserrat Umadhay. This mortgage was registered and annotated on the title. After Eriberto failed to redeem, the property was foreclosed and sold at public auction to Umadhay, confirmed by the court in 1954. A new title (TCT No. T-15522) was issued in Umadhay’s name. The Umadhays then sold the property to Crisanta S. Gumban, who obtained a new title (TCT No. T-18274). Carmen Gumban’s 1/3 share had been sold through a series of transactions, ultimately to Eriberto, giving him two-thirds of Paz’s share. The dispute centers on Enrique’s 1/3 share, sold to Angelina Maquiling. The trial court ruled in favor of Angelina, declaring her owner of that 1/3 share and ordering Crisanta Gumban to deliver possession. The Court of Appeals reversed, upholding the mortgage, foreclosure, and subsequent sale, declaring the defendants purchasers in good faith and barring the plaintiff’s action by laches.

ISSUE

The primary issue is whether the respondents (Umadhay spouses and Crisanta S. Gumban) are purchasers in good faith entitled to protection under the Torrens system, thereby defeating the unregistered claim of petitioner Angelina Maquiling to a 1/3 share of the property.

RULING

The Supreme Court modified the decision of the Court of Appeals. It held that the Umadhay spouses could not claim protection as purchasers in good faith because at the time of the mortgage, the title was still in the name of the deceased Paz Maquiling, not in their grantor, Eriberto Gumban, Jr. They relied merely on Eriberto’s self-serving affidavit of adjudication and were not protected by the indefeasibility of the Torrens title, as they should have been put on guard to verify his claims. However, the Court upheld the status of Crisanta S. Gumban as a purchaser in good faith and for value. At the time of her purchase, the title was already in the name of her vendors, the Umadhays (TCT No. T-15522). She had the right to rely on the face of the certificate of title, and there was no indication she knew of any unregistered claims. The Court affirmed the Court of Appeals’ decision reversing the trial court and dismissing the complaint, but without prejudice to any other relief available to the petitioner against Eriberto Gumban, Jr. and/or the Umadhay spouses. Costs were awarded to respondent Crisanta S. Gumban.