G.R. No. L-4340, L-4341, L-4342, L-4343, L-4344, L-4345, L-4346; May 28, 1952
REBECCA LEVIN, plaintiff-appellee, vs. JOAQUIN V. BASS, ET AL., defendants. EUGENIO MINTU, defendant-appellant. (L-4340)

JOAQUIN V. BASS, plaintiff-appellee, vs. JOSE C. ROBLES, ET AL., defendants. REBECCA LEVIN, ET AL., intervenors. EUGENIO MINTU, intervenor-appellant. (L-4341)
JOAQUIN V. BASS, plaintiff-appellee, vs. EUGENIO MINTU, defendant-appellant. (L-4342)
REBECCA LEVIN, plaintiff-appellee, vs. JOAQUIN V. BASS, defendant-appellant. (L-4343)
JOAQUIN V. BASS, plaintiff-appellant, vs. REBECCA LEVIN, defendant-appellee. (L-4344)
JOAQUIN V. BASS, plaintiff-appellant, vs. JOSE C. ROBLES and AMINTA T. DE ROBLES, defendants-appellees. (L-4345)
JOAQUIN V. BASS, plaintiff-appellant, vs. AMINTA T. DE ROBLES, defendant-appellee. (L-4346)

FACTS

These consolidated cases revolve around properties at 326 and 328 San Rafael Street, Manila, originally owned by Rebecca Levin, an illiterate widow. In late 1943/early 1944, Joaquin V. Bass, representing himself as a real estate broker, persuaded Levin to sell her house and lot at No. 326 by falsely claiming a Japanese buyer was interested and that she could use the proceeds to buy a better property on Antonio Rivera Street. Relying on these representations, Levin signed documents which Bass presented as merely an “authority to sell.” These documents turned out to be a deed of absolute sale (Exhibit A) of No. 326 to Emiliano Eustaquio for P30,000, and later a deed of sale (Exhibit C) of No. 328 to Bass himself for P65,000. Bass took Levin’s title and paid off an existing mortgage, but retained most of the money, giving her a false receipt for a property on Antonio Rivera Street. Bass subsequently sold No. 326 to Eustaquio (Exhibit A), and Eustaquio then sold it to Bass (Exhibit B). Bass later sold No. 326 to Eugenio Mintu under certain conditions. The trial court annulled the sales (Exhibits A, B, and C) due to fraud, ordered the cancellation of Bass’s titles, and reinstated Levin as owner, subject to a mortgage in favor of Co Chin Leng. It also dismissed various detainer actions filed by Bass and ordered him to account for and pay collected rentals to Levin.

ISSUE

The central issue, among others consolidated, is whether Eugenio Mintu, a subsequent purchaser for value of the property at 326 San Rafael Street, acquired a valid title despite the fraudulent transactions perpetrated by Joaquin V. Bass against the original owner, Rebecca Levin.

RULING

The Supreme Court MODIFIED the trial court’s decision. It held that while the sales from Levin to Eustaquio and to Bass were indeed fraudulent and voidable, Eugenio Mintu acquired a valid and indefeasible title to the house and lot at No. 326 San Rafael Street. Mintu was a purchaser in good faith and for value who relied on the clean Torrens certificate of title issued in the name of Joaquin V. Bass. Under the Land Registration Act (Act No. ̄496), a title issued under the Torrens system is indefeasible and imprescriptible, and everyone dealing with registered land can rely on the correctness of the certificate of title. The Court applied the principle that “as between two innocent persons, one of whom must suffer the consequence of a breach of trust, the one who made it possible by his act of confidence must bear the loss.” Levin, by entrusting her title and signing documents without understanding them, made the fraud possible. Therefore, Mintu is declared the rightful owner of No. 326 since November 8, 1944, entitled to its possession and rentals, subject to the registered mortgage in favor of Co Chin Leng. The rights awarded to Levin by the trial court over No. 326 are deemed awarded to Mintu. The rest of the judgment not inconsistent with this ruling is affirmed. The Court also directed the City Fiscal of Manila to investigate Joaquin V. Bass and notary public Eliezer A. Manikan.