G.R. No. L-9372, December 15, 1914
JULIA TUASON, plaintiff-appellee, vs. FAUSTINO RAYMUNDO, defendant-appellant.

FACTS:
Vicente Rodriguez and Gregoria Baroto Cruz were the registered owners of a parcel of land under the Torrens system. On May 1, 1911, they sold the property to Faustino Raymundo under a pacto de retro (sale with right of repurchase) for P400, with a one-year redemption period. This sale was not registered in the Registry of Property. The vendors did not redeem the property within the year, but Raymundo granted an indefinite extension. Subsequently, on March 3, 1913, the same vendors sold the same property to Julia Tuason for P2,800. Tuason’s sale was immediately and duly registered. Tuason took possession and leased the property to Trinidad Maranga. Raymundo, claiming rights under his prior unregistered sale, obtained a judgment against the original vendors (Rodriguez and Cruz) in an action where Tuason and her tenant were not parties. Based on this judgment, the sheriff ousted Tuason’s tenant from the property. Tuason then filed an action to recover possession.

ISSUE:
Which sale prevailsthe prior unregistered sale under a pacto de retro to Raymundo, or the subsequent registered sale for value and in good faith to Tuason?

RULING:
The subsequent registered sale to Tuason prevails. Under Section 50 of Act No. 496 (The Land Registration Act), no voluntary instrument purporting to convey registered land shall take effect as a conveyance or bind the land until it is registered. The act of registration is the operative act that conveys and affects the land. The prior unregistered sale to Raymundo operated only as a contract between the parties and did not transfer ownership. In contrast, the subsequent sale to Tuason, made for value and in good faith, and duly registered in accordance with law, effectively transferred the title. Therefore, Tuason is the rightful owner and is entitled to possession. The judgment of the Court of First Instance in favor of Tuason was affirmed.