G.R. No. 32805 ; January 29, 1931
CORNELIUS H. W. KERHOVEN, ET AL., applicants. MARIANO R. FLORES, petitioner-appellant, vs. MANUEL Q. FAUSTINO, respondent-appellee.

FACTS

The land was originally owned by Esteban A. Cortes. On May 23, 1925, Esteban sold it to his father, Eutiquiano Cortes, who obtained Transfer Certificate of Title (TCT) No. 699. Four days later, Mariano R. Flores sued Esteban for a debt, obtained a judgment, and levied upon the land. The sheriff sold the land at public auction to Flores on February 24, 1927. The sheriff’s certificate of sale was recorded in the Day Book but was not annotated on TCT No. 699. Subsequently, Eutiquiano sold the land to Jose Ma. Valero (TCT No. 899 issued), who later sold it to Manuel Q. Faustino (TCT No. 925 issued). After the redemption period expired, Flores obtained a sheriff’s deed but could not register it without Faustino’s TCT. Flores filed a motion to compel Faustino to surrender his TCT for cancellation and issuance of a new one in Flores’s name.

ISSUE

Whether the sale of the land by Esteban to his father Eutiquiano was fraudulent and whether Faustino, as a subsequent purchaser, holds a valid title that cannot be cancelled in favor of Flores.

RULING

The Supreme Court affirmed the lower court’s denial of Flores’s motion. The sale from Esteban to Eutiquiano was not proven fraudulent; it could have been a legitimate transaction, such as payment of a debt. The subsequent purchases by Valero and Faustino were made in good faith. Therefore, Faustino’s TCT is valid and cannot be cancelled. The sheriff’s sale to Flores, while creating a right, did not defeat the title of a good faith purchaser for value (Faustino) where the levy was not properly annotated on the certificate of title.

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