G.R. No. L-16448. April 29, 1961.
REGISTER OF DEEDS OF QUEZON CITY, petitioner; PEOPLE’S HOMESITE AND HOUSING CORPORATION, vendor; and DEVELOPMENT BANK OF THE PHILIPPINES, vendee-appellant, vs. HONESTO G. NICANDRO and ELISA F. NICANDRO, vendees-appellees.

FACTS

On October 20, 1955, the People’s Homesite and Housing Corporation (PHHC) sold 159 lots to the Rehabilitation Finance Corporation, now the Development Bank of the Philippines (DBP). The lots were then part of a larger parcel covered by TCT No. 1356. Subsequently, without DBP’s knowledge, these lots were segregated, and a new TCT No. 36533 was issued for them. The subdivision plan and the cancellation of TCT No. 1356 pro tanto were not annotated on the old title. When DBP’s deed of sale was presented for registration on January 15, 1959, it was inscribed on TCT No. 1356 as a sale of unsegregated portions, with a note that new titles would be issued upon presentation of the approved subdivision plan.
On February 16, 1959, Honesto G. Nicandro and Elisa F. Nicandro presented for registration deeds of sale from PHHC covering Lots 2 and 4, Block 21, which were among the 159 lots previously sold to DBP. Their registration was denied due to procedural defects. The next day, they filed an affidavit of adverse claim, which was annotated on TCT No. 36533. Upon discovering the new title, DBP caused the annotation of its 1955 deed of sale on TCT No. 36533 on March 6, 1959, and the Register of Deeds transferred the original annotation from TCT No. 1356 to TCT No. 36533. With both parties claiming the lots, the Register of Deeds referred the matter en consulta to the Land Registration Commissioner.

ISSUE

Whether the prior annotation of DBP’s deed of sale on the old certificate of title (TCT No. 1356) constitutes effective registration that prevails over the subsequent adverse claim filed by the Nicandros.

RULING

Yes. The Supreme Court reversed the Land Registration Commissioner’s resolution and ruled in favor of DBP. The Court held that DBP’s registration was effective and had priority. First, the sale contract to DBP was not defective; it explicitly referred to the specific lots in Blocks 21-31 and obligated PHHC to complete the subdivision and secure titles for DBP, indicating a sale of identifiable though then unsegregated portions. Second, the annotation on TCT No. 1356 was a valid act of registration under the Torrens system. The subsequent issuance of TCT No. 36533 for the segregated lots did not nullify this prior registration. The Register of Deeds correctly transferred the annotation to the new title upon discovery of the subdivision plan’s approval. Since DBP’s deed was registered on January 15, 1959, and the Nicandros’ adverse claim was only annotated on February 17, 1959, priority in time favored DBP.
Furthermore, the Nicandros’ remedy of filing an adverse claim under Section 110 of Act No. 496 (the Land Registration Act) was improper. This special remedy is only available when no other provision in the law allows for the registration of the claimant’s right. Here, the Nicandros’ claim was based on a deed of sale, for which the Act specifically provides a procedure for registration under Section 57. Having failed to register their deed, their adverse claim could not prevail over DBP’s duly