G.R. No. 255934 . July 13, 2022
DEANNA DU, PETITIONER, VS. RONALD A. ORTILE, IN HIS CAPACITY AS DEPUTY ADMINISTRATOR OF THE LAND REGISTRATION AUTHORITY AND REGISTER OF DEEDS, CITY OF MANILA, RESPONDENTS.

FACTS

Petitioner Deanna Du entered into a Memorandum of Agreement with Malayan Savings and Mortgage Bank for the purchase of a parcel of land in Manila. Malayan Bank had acquired the property through a foreclosure sale. Du made a substantial down payment. However, Malayan Bank failed to deliver the property free from liens as warranted because an heir of the former owner, Melissa Tuason-Principe, filed an action to annul the foreclosure sale. Melissa Principe eventually reacquired the property through a compromise agreement approved by the Regional Trial Court.
Aggrieved, Du filed a petition for annulment of judgment against Malayan Bank and Melissa Principe before the Court of Appeals. To protect her interest, she subsequently filed a notice of lis pendens with the Register of Deeds of Manila. The Register of Deeds denied its registration, citing Du’s failure to implead the registered owners of the property as parties in her annulment petition. This denial was affirmed by the Land Registration Authority (LRA) through Deputy Administrator Ronald Ortile. The LRA added that a notice of lis pendens is not proper when the action is merely for the recovery of money.

ISSUE

The core issue is whether the annotation of a notice of lis pendens on a certificate of title requires that the registered owner of the property be impleaded as a party in the underlying action.

RULING

The Supreme Court denied the petition and affirmed the rulings of the lower courts. The Court held that for a notice of lis pendens to be properly annotated, the registered owner must be a party to the case. The legal logic is anchored on the nature and purpose of lis pendens. A notice of lis pendens serves as a warning to all persons that a particular real property is involved in litigation, and that any subsequent transaction they enter into concerning the property is subject to the outcome of that suit. Its primary function is to protect the real rights of the party who caused its registration.
Crucially, this protective mechanism and the constructive notice it provides are intended for the benefit of parties to the litigation and those who derive their rights from them. If the registered owner is not a party, the litigation cannot directly bind the title or the owner. Therefore, annotating a lis pendens in such a scenario would be improper, as it would not serve its intended legal purpose of binding the property to the judgment. The Court distinguished the case of Voluntad v. Spouses Dizon, cited by Du, noting it involved unique circumstances where the registered owners were successors-in-interest to a party in the litigation, making it inapplicable here.
The Court further clarified that while the text of Section 76 of the Property Registration Decree (P.D. No. 1529) does not explicitly state the requirement, this condition is derived from the fundamental principle that a judgment cannot bind a person who is not a party to the action. Since the efficacy of a lis pendens is precisely to bind the property to the potential judgment, the underlying action must involve the parties whose interests are sought to be bound—principally, the registered owner. The Court concluded that the Register of Deeds and the LRA correctly denied the registration of the notice of lis pendens.