Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. 8160 October 27, 1916
MARCOS DE LA CRUZ, plaintiff-appellee,
vs.
RAMON A!"E, ET AL., defendants-appellants.
Antonio Sanz for appellant Fabie.
No appearance for other appellants.
Thos. D. Aitken for appellee.

ARELLANO, C. J.:
On August 2, !"#", Ma$cos de la C$u% filed a co&plaint against 'edasto 'ela%(ue%, in )hich
he alleged the follo)ing facts* +!, -hat he is the ad&inist$ato$ of the estate of .$ego$ia /e$nande%,
deceased0 +2, that, on 1anua$2 !!, !"#3, .$ego$ia /e$nande% )as decla$ed b2 the Cou$t of 4and
Regist$ation to be the o)ne$ of a pa$cel of land situated at No. 53 Calle Magdalena, in the dist$ict of
Binondo of this cit2 +the othe$ specific ci$cu&stances in connection the$e)ith as alleged in the said
co&plaint a$e he$ein ta6en fo$ g$anted, and the p$ope$ ce$tificate of title No. !2!, )as issued in he$
favo$ b2 the $egiste$ of deeds of the cit2 of Manila0 +, that the defendant 'edasto 'ela%(ue%, being
the atto$ne2 in fact of .$ego$ia /e$nande% and having in his possession all docu&ents and
&uni&ents of title $elative to the said land, succeeded in having the $egiste$ of deeds issue to hi& a
ce$tificate of title the$eto on 1anua$2 !7 of the sa&e 2ea$, b2 p$esenting a deed of sale e8ecuted in
his behalf b2 the said .$ego$ia /e$nande%0 but that the said deed of sale )as false and f$audulent
and )as not e8ecuted b2 .$ego$ia /e$nande% no$ b2 an2 pe$son autho$i%ed b2 he$ so to do,
)he$efo$e it )as canceled and annulled b2 the 9udg&ent fo$ :ece&be$ !, !"#;, $ende$ed b2 the
Cou$t of <i$st =nstance of the cit2 of Manila, as a $esult of the co&plaint filed b2 .$ego$ia /e$nande%
against 'edasto 'ela%(ue% on >epte&be$ 2?, !"#5, of )hich a notice of lis pendens)as se$ved on
the $egiste$ of deeds on Ma2 7, !"#;0 +3, that, on Nove&be$ ;, !"#3, 'edasto 'ela%(ue% sold the
said land unde$ pacto de retro to Ra&on <abie, and in Ma2, !"#;, sold it to hi& out$ight, )he$eupon
ce$tificate of title No .;55 )as issued to the pu$chase$, Ra&on <abie being thencefo$th the o)ne$ of
the land and .$ego$ia /e$nande% being dep$ived of he$ o)ne$ship the$ein0 +?, that the said land )as
)o$th P!?,### and its $ental value P2!3. B2 $eason of all the fo$egoing facts, the plaintiff p$a2ed the
cou$t to o$de$ 'edasto 'ela%(ue% and the =nsula$ -$easu$e$ +the latte$ subsidia$il2 in case of
nonpa2&ent b2 the fo$&e$, to pa2 hi& P2",322, )ithout legal inte$est, and to pa2 the costs.
-hese facts, it is to be supposed, )e$e ad&itted b2 the Atto$ne2-.ene$al in behalf of the
=nsula$ -$easu$e$ in de&u$$ing to the co&plaint.
-he plaintiff a&ended pa$ag$aph fou$ of his co&plaint, )hich )as &ade to $ead as follo)s*
-hat on Nove&be$ ;, !"#3, 'edasto 'ela%(ues sold the land to Ra&on <abie unde$ pacto de retro,
the sale beco&ing absolute in Ma2, !"#;, no encu&b$ance being noted on the ce$tificate of title at
the ti&e of the said sale of Nove&be$ ;, !"#30 that on Nove&be$ ;, !"#3, Ra&on <abie p$esented
his deed of sale unde$ pacto de retro fo$ $egist$ation, and it )as $egiste$ed on the sa&e date,
Nove&be$ ;, !"#30 and that Ra&on <abie $eceived fo$ the $egiste$ of deeds title to the said land,
th$ough &eans of ce$tificate No. ;55, and since the date of the $egist$ation beca&e, and is still, the
o)ne$ of the land.
-he Cou$t of <i$st =nstance of the cit2 of Manila sustained the de&u$$e$ and g$anted plaintiff
five da2s in )hich to a&end his co&plaint, but as the plaintiff )ould not a&end it the cou$t dis&issed
the co&plaint and the p$oceedings )ith $espect to the =nsula$ -$easu$e$, )ith the costs against the
plaintiff.
-he plaintiff appealed and, on >epte&be$ 2, !"!!, this cou$t affi$&ed the 9udg&ent of the t$ial
cou$t, also )ith costs against the plaintiff. -he latte$ &oved fo$ a $ehea$ing and his &otion )as
denied on :ece&be$ 3, !"!?. >uch )as the te$&ination of this suit +case No. ?7?7,.
!
On Octobe$ !, !"!!, Ma$cos de la C$u% filed a ne) co&plaint against Ra&on <abie and the
$egiste$ of deeds, in )hich he p$a2ed the cou$t* +!, -o cancel and annul the deed of conve2ance, the
E8hibit :0 +2, to o$de$ the $egiste$ of deeds to cancel the ent$2 of $egist$ation of the docu&ents A, C,
and : and the ce$tificates Nos. 3 and ;550, and +, to o$de$ Ra&on <abie to $esto$e the land and to
pa2 P!;,!";5 fo$ losses and da&ages, togethe$ )ith legal inte$est the$eon and costs.
-he docu&ent A is the deed of sale b2 .$ego$ia /e$nande% to 'edasto 'ela%(ues. :ocu&ent
C is the inst$u&ent of sale unde$ pacto de retro f$o& 'edasto 'ela%(ue% to Ra&on <abie. :ocu&ent
: is the deed of final sale b2 'ela%(ue% to <abie.
-he histo$2 of the case is as follo)s* 'edasto 'ela%(ue% )as the atto$ne2 in fact of .$ego$ia
/e$nande%. .$ego$ia /e$nande% $egiste$ed he$ title of o)ne$ship to the land in (uestion in the
p$ope$t2 $egist$2 and )as issued ce$tificate of tittle No. !2!. 'edasto 'ela%(ue%, being the atto$ne2
in fact of .$ego$ia /e$nande%, had in his possession all the &uni&ents of title of the land, including
the ce$tificate of title No. !2!, and, abusing he$ confidence in hi&, a fe) da2s afte$ the $egist$ation of
the land, fo$ged a nota$ial inst$u&ent )he$ein he &ade it appea$ that she had sold the said land to
hi& fo$ the p$ice of P7,###.
'edasto 'elas(ue% then )ent to the $egiste$ of deeds and applied fo$ the $egist$ation of the
land in his o)n na&e, p$esenting .$ego$ia /e$nande%@ ce$tificate of title No. !2! fo$ cancellation,
and the deed of conve2ance )hich )as pu$po$ted to have been &ade b2 .$ego$ia /e$nande% in his
favo$ in o$de$ that he &ight be $egiste$ed as the t$ue o)ne$ of the land. All this )as done0 .$ego$ia
/e$nande%@ title )as cancelled and ce$tificate of title No. 3 )as issued to 'edasto 'ela%(ue%.
'edasto 'ela%(ue%, on Nove&be$ ;, !"#3, sold the land to Ra&on <abie fo$ P?,###
unde$ pacto de retro, in the follo)ing te$&s* A-his sale is condition on that if, upon the te$&ination of
the pe$iod of one 2ea$ f$o& the date of the e8ecution of the p$esent inst$u&ent, =, the vendo$, do not
$epu$chase the p$ope$t2 f$o& the vendee fo$ the p$ice above specified, the said p$esent conditional
sale shall be conve$ted into an absolute and un$est$icted one0 Provided, however, -hat the said
pe$iod &a2 be e8tended fo$ anothe$ 2ea$, if both pa$ties a$e )illing.A
Ra&on <abie p$esented this deed to the $egiste$, )ho ente$ed on the bac6 of 'edasto
'ela%(ue%@ title a &e&o$andu& of the sale unde$ pacto de retro &entioned in the deed.
On Ma2 !, !"#;, 'edasto 'ela%(ue% sold the land finall2 and absolutel2 to Ra&on <abie,
)ho p$esented to the $egiste$ of deeds the nota$ial inst$u&ent e8ecuted fo$ the pu$pose and )as
the$eupon fu$nished )ith the ce$tificate of title No. ;55.
On >epte&be$ 25, !"#5, .$ego$ia /e$nande% filed a co&plaint against a 'edasto 'ela%(ue%
in the Cou$t of <i$st =nstance of the cit2 of Manila, and the plaintiff sa2s that the cou$t $ende$ed
9udg&ent on :ece&be$ !, !"#;, canceling and annulling the inst$u&ent E8hibit A. -his 9udg&ent
)as neve$ p$esented in evidence in the fo$&e$ p$oceedings no$ has it been sho)n in the p$esent
case0 but, b2 stipulation of the pa$ties, it is ad&itted that the said inst$u&ent )as f$audulent, null, and
void. P$oof of this point is, the$efo$e, no longe$ necessa$2.
Not)ithstanding that the said co&plaint )as filed on >epte&be$ 25, !"#5, the $egiste$ of
deeds )as not notified of the lis pendens +E8hibit B, until Ma2 3, !"#;, although the 2ea$ stipulated
in E8hibit C fo$ the e8e$cise of the $ight of $ede&ption, )hich 'edasto 'elas(ue% had $ese$ved to
hi&self, had elapsed since Nove&be$ ;, !"#?0 fo$& this date, Nove&be$ ;, !"#?, the sale unde$
$ight of $epu$chase had beco&e conve$ted into an absolute and final sale, pu$suant to the
stipulations contained in the said inst$u&ent E8hibit C.
>uch a$e the facts of the p$esent case, the sa&e as those of the p$evious one, )ith the
diffe$ence that the fi$st action )as b$ought against the Aassu$ance fundA of the =nsula$ -$easu$2, )hile
the case at ba$ is an action to $ecove$ the land sold b2 'ela%(ue% to <abie, since the su& fo$ )hich
the =nsula$ -$easu$e$ )as sued could not be obtained.
-he t$ial cou$t, p$esided ove$ b2 the /ono$able 1udge Cha$les >. 4obingie$, g$anted all the
de&ands of the co&plaint.
-he fi$st de&and is that the inst$u&ent E8hibit : b avoided and canceled and that the
e8ecution of this inst$u&ent be decla$ed null and void in so fa$ as it is clai&ed that it affects the
plaintiff@s $ights.
-he docu&ent E8hibit : is the deed of final sale &ade b2 'edasto 'ela%(ue% to Ra&on <abie.
Nothing is as6ed fo$ )ith $ega$d to E8hibit C, )hich id the pacto de retro p$eviousl2 e8ecuted
b2 'edasto 'ela%(ue% in behalf of this sa&e <abie. As &a2 be seen, the plaintiff &aintains and
$ecogni%es the enti$e validit2 of the said pacto de retro, )hich, b2 fo$ce of the te$&s of the covenant
itself, )as conve$ted into a final sale on Nove&be$ ;, !"#?, the$efo$e &a6ing the e8ecution of the
docu&ent E8hibit : unnecessa$2. =n his b$ief in the p$evious case, No. ?7?7, the plaintiff said* A-he
facts sho) that he +<abie, bought the p$ope$t2 fo$& 'edasto 'ela%(ue% on Nove&be$ ;, !"#3, unde$
the $ight of $epu$chase, and that the sale )as i&&ediatel2 $egiste$ed. -he evidence also sho)s that
the ti&e of the pu$chase the ce$tificate of title bo$e no ent$2 of an2 encu&b$ance. Conse(uentl2,
<abie )as vested )ith a pe$fect title on Nove&be$ ;, !"#3 +see secs. ?# and ?? of Act No. 3"5,. /is
title )as sub9ect to a $ight o$ $epu$chase )hich e8pi$ed in Ma2, !"#; +not so0 it e8pi$ed on Nove&be$
; of the 2ea$ !"#?, fo$ the pe$iod stipulated )as one 2ea$,. @-he validit2 and sufficienc2 of a p$ope$l2
e8ecuted cont$act of pu$chase and sale is not affected o$ )ea6ened b2 the addition the$eto of an
ag$ee&ent of pacto de retroinas&uch as the $ight of o)ne$ship of the thing sold, although it &a2 be
defeated, is the$eb2 t$ansfe$$ed to the vendee, )ho is substituted fo$ the vendo$ .+.uille$&o vs.
Matien%o, 7 Phil. Rep., 57.,@
Bell then , supposing that a notice of lis pendens, in connection )ith the case of
.$ego$ia /e$nande% vs. 'edasto 'ela%(ue%, No. 3"!2 of the Cou$t of <i$st =nstance, fo$ the
cancellation of the f$audulent deed of sale,, had been p$esented to the $egiste$ of deeds on
Ma2 7, !"#;, )hat effect could it have against <abieC +-he plaintiff is tal6ing,.-he &e$e fact
that the $ight to $epu$chase e8pi$ed subse(uent to the date +no0 t)o and a half 2ea$s befo$e,
in no &anne$ affects his $ights. -hese )e$e ac(ui$ed on Nove&be$ ;, !"#3. -he$efo$e the
(uestions $elative to the lis pendens and the date of the e8pi$ation of the pe$iod g$anted
'ela%(ue% to $epu$chase f$o& <abie, &a2 be eli&inated. +B$ief, pp. ! and !3.,
-his cou$t can not possibl2 affi$& the 9udg&ent of the t$ial cou$t in do fa$ as it g$ants the fi$st
de&and of the co&plaint, fo$ the legal $easons contained in the p$eceding conside$ations put
fo$)a$d b2 the plaintiff hi&self in his said b$ief, to )it* +!, Because Ra&on <abie@s title is pe$fect,
pu$suant to sections ?# and ?? of Act No. 3"50 +2, because the o)ne$ship of eve$2 pu$chase$, even
though it be sub9ect to a $ight to $edee& and be defeasible b2 the covenant, o$iginates f$o& the
consu&&ation of the cont$act o$ fo$& the ti&e of the delive$2 to hi& of the thing pu$chased, and
the pacto de retro does not affect the o)ne$ship of the thing sold &o$e than to eithe$ $econve2 it to
the vendo$ o$ to consolidate it in the pu$chase$, once the condition has been fulfilled o$ e8tinguished,
as decided b2 this >up$e&e Cou$t in the case cited b2 the plaintiff and in &a2 othe$ decisions )hich
no) constitute settled doct$ines0 +, because a notice of lis pendens $egiste$ed on Ma2 7, !"#;,
cannot affect a sale consu&&ated since Nove&be$ ;, !"#3, and )hich had beco&e i$$evocable and
absolute since the sa&e date of the follo)ing 2ea$s !"#?, and , as the plaintiff hi&self ve$2 p$ope$l2
insists, all (uestions $ega$ding the effect of such a notice should be eli&inated0 and +3, because the
docu&ent E8hibit : is one of supe$e$ogation o$ &e$el2 co$$obo$ative0 it confe$s no othe$ $ight, and
has no othe$ signification than a confi$&ation of )hat is i&plied b2 that )hich is e8plicit in
acco$dance )ith the fo$&alities of the $egiste$. >o that, although the docu&ent E8hibit : )e$e
decla$ed to be null and void in o$de$ to dep$ive of its effects the absolute sale the$ein stipulated, the
land )ould not fo$ that $eason cease to belong to <abie, fo$ the $easons stated b2 the plaintiff
hi&self, that is, because the docu&ent E8hibit C, )hich is a pe$fect title of o)ne$ship, in acco$dance
)ith la) and the cases cited, $e&ains in fo$ce.
-he insc$iption of o)ne$ship &ade in the $egist$2 in behalf of .$ego$ia /e$nande% had
disappea$ed, having been substituted b2 the ent$2 in the na&e of 'edasto 'ela%(ue%0 and as the
$egist$2 sho)ed the latte$ to be the o)ne$ of the land, <abie )as enabled to a$$ange )ith hi& to
pu$chase it.
=t having been p$oven that <abie@s o)ne$ship )as and is pe$fect and absolute and that he is
entitled to possess, as he does possess, the land in (uestion, it is indsiputable that .$ego$ia
/e$nande% had lost he$ p$ope$t2, and so it )ould appea$ that she )as entitled to the inde&nit2 she
sought to $ecove$ in the p$evious suit, case No. ?7?7.
But that inde&nit2 )as denied he$ b2 both the t$ial cou$t and this cou$t, p$incipall2 fo$ the
$eason of he$ negligence .>ection !#! of Act No. 3"5 p$ovides that an2 pe$son )ho without
negligence on his pa$t is )$ongfull2 dep$ived of an2 land o$ an2 inte$est the$ein, b2 the $egist$ation of
an2 othe$ pe$son as the o)ne$ of such land, &a2 b$ing an action against the =nsula$ -$easu$e$. <abie
)as $egiste$ed as the o)ne$, it is t$ue, but .$ego$ia /e$nande% had not p$oven that he )as enabled
to obtain the insc$iption )ithout negligence on he$ pa$t.
-he lo)e$ cou$t states the facts of the case in the follo)ing te$&s* A=t is alleged in the
co&plaint and ad&itted in the stipulation that 'ela%(ue%, on 1anua$2 !7, !"#3, succeeded in
$egiste$ing in his o)n na&e the pa$t of the p$ope$t2 belonging to the deceased +.$ego$ia
/e$nande%, that is the sub9ect &atte$ of these p$oceedings b2 e8hibiting fo$ the pu$pose a fo$ged
docu&ent +E8hibit A,. On Nove&be$ ;, !"#3, 'ela%(ue% e8ecuted the docu&ent E8hibit C in favo$ of
the defendant <abie, )ho in tu$n p$esente it to the $egiste$ of deeds and obtained the $egist$ation in
his na&e .-his docu&ent contains a clause of pacto de retro, valid fo$ one 2ea$, )hich subse(uentl2
e8pi$ed on Nove&be$ ;, !"#?. -he f$aud co&&itted b2 'ela%(ue% having been discove$ed in the
eanwhile +that is, bet)een Nove&be$ ;, !"#3, and Nove&be$ ;, !"#?,, the deceased, on
>epte&be$ 2!, !"#5, b$ought an action to have said docu&ent annulled and on Ma2 7, !"#;, a
notification of lis pendens )as filed in the office of the $egiste$.A
=n the fo$&e$ p$oceedings the Atto$ne2-.ene$al, in behalf of the =nsula$ -$easu$e$, de&u$$ed to
the co&plaint filed fo$ the pu$pose of $ecove$ing inde&nit2, alleging that the co&plaint itself sho)ed
that if .$ego$ia /e$nande% suffe$ed an2 loss o$ da&age )hatsoeve$, it )as due to
he$ negligence and to the deceit andfaithlessness of he$ agent and atto$ne2 in fact 'edasto
'ela%(ue% to )ho& she had confided he$ ce$tificate of title, and that such loss and da&age did not
$esult f$o& having b$ought the land unde$ the p$ovisions of the 4and Regist$ation Act, f$o& its being
$egiste$ed b2 an2 othe$ pe$son, f$o& an2 o&&ission, &ista6e, o$ legal act undul2 pe$fo$&ed b2 the
cle$6 o$ $egiste$, deput2 o$ substitute of the $egiste$, in the discha$ge of thei$ official duties. <o$ this
$eason the lo)e$ cou$t sustained the de&u$$e$, and p$incipall2 fo$ this sa&e $eason )e affi$&ed the
9udg&ent of the lo)e$ t$ibunal.
Although case No. ?7?7, the $eco$d of )hich is attached as evidence to these p$oceedings, is
te$&inated, )e desi$e to sa2 that, fo$ the $easons )hich )ill be given late$ on in connection )ith this
case, the $eason fo$ sustaining the de&u$$e$ and fo$ finall2 den2ing pe$&ission to b$ing an action
against the assu$ance fund, to )it .$ego$ia /e$nande%@ negligence, is solidl2 founded on good
autho$it2 and on facts, though these latte$ onl2 appea$ in the p$esent case, because the fo$&e$
p$oceedings )ent no fa$the$ than the de&u$$e$ and the plaintiff $efused to a&end his co&plaint.
-he plaintiff hi&self testified in these p$oceedings that .$ego$ia /e$nande%, )hile still living,
co&&issioned Ad$iano Buenaventu$a to attend to a ce$tain &atte$ connected )ith he$ p$ope$t2 titles,
and that this )as in !"#30 that .$ego$ia /e$nande% said that 'edasto 'ela%(ue% had not delive$ed to
he$ the docu&ents pe$taining to he$ land, and she &ade this state&ent to the plaintiff )hen he$
&ental faculties )e$e as 2et uni&pai$ed0 and )hen the plaintiff )as as6ed )hethe$ 'edasto
'ela%(ue% used to go to .$ego$ia /e$nande%@ house ve$2 often, he $eplied that he did, so&eti&es in
the &o$ning, at othe$s in the afte$noons, and again du$ing the siesta hou$ +$eco$d, pp. ?;-?7,.
Ad$iano Buenaventu$a co$$obo$ated the $efe$ences to hi& &ade in the testi&on2 9ust above
&entioned, and stated that 'edasto 'ela%(ue% )as the pe$son )ho handled .$ego$ia /e$nande%@
docu&ents0 that the land in (uestion )as the onl2 pa$cel that she possessed and that it )as used fo$
building pu$poses and fo$ $aising fo$age g$ass0 that 'edasto 'ela%(ue% lived in the sa&e house )ith
.$ego$ia /e$nande%, )ho had neithe$ husband no$ child$en and )as 5# 2ea$s old0 that )hen the
)itness &ade a de&and upon 'edasto 'ela%(ue%, the latte$ told hi& Athat he +'ela%(ue%, )ould
p$esent the docu&ent on such and such a da2, and that he )ould delive$, if not the &one2, the
docu&ent0A and that the pe$son )ho inte$vened )as Aniceto Re2es as ad&inist$ato$.
<$o& this testi&on2 of the plaintiff@s o)n )itnesses it is to be seen that .$ego$ia /e$nande%,
even as fa$ bac6 as !"#3, called upon 'edasto 'ela%(ue% to delive$ to he$ the ce$tificate of title, and
that 'edasto 'ela%(ue% )as al$ead2 spea6ing of delive$ing &one2 to /e$nande%, and if not &one2,
the docu&ent0 that /e$nande% since !"#3 inte$ested he$self in the &atte$ of he$ docu&ents and in
the onl2 piece of land she possessed, the $ental of )hich, as set fo$th in the plaintiff@s fi$st co&plaint,
)as P2!3 pe$ &onth, o$, as he stipulated )ith <abie in this second co&plaint, onl2 P55 pe$ &onth,
but )hethe$ it )as P2!3 o$ P55, /e$nande% )as too &uch in absolute need of this inco&e fo$ he$
suppo$t not to have been an8ious about it and about he$ land .Neve$theless, until >epte&be$, !"#5,
she had not co&&enced an2 9udicial p$oceedings in $espect to the said land, the alleged f$audulent
sale of such b2 'edasto 'ela%(ue% in Nove&be$, !"#3, she t$ied to annul, as it )as annulled b2 the
cou$t on :ece&be$ !, !"#;.
1a&es Ed)a$d /off, the autho$ of a )o$6 dee&ed b2 the t$ial 9udge to be autho$itative, entitled
AAust$alian -o$$ens >2ste&,A sa2s on page 337 the$eof* A=n so&e cases da&ages a$e $ecove$able,
o$ a$e onl2 $ecove$able unde$ ce$tain conditions. !. . . . 2. . . . . No da&ages a$e $ecove$able f$o&
the Dassu$ance fund@ if the loss has been caused o$ cont$ibuted to b2 the o)ne$@s negligence .3. Bith
so&e e8ceptions, da&ages a$e not $ecove$able f$o& the @assu$ance fund fo$ loss occasioned b2
b$eaches of t$ust.@A
-he Atto$ne2-.ene$al did not e$$ )hen he )$ote in his b$ief in the p$eceding case* A-o hold
that the p$incipal &a2 $ecove$ da&ages f$o& the assu$ance fund on account of such a f$audulent act
as that cha$ged to 'edasto 'ela%(ue% in this case )ould be e(uivalent to th$o)ing open the doo$ to
f$aud, to the g$eat advantage of the $egiste$ed lando)ne$ and his agent and to the $uin and $apid
disappea$ance of the assu$ance fund, and the gene$al funds of the =nsula$ -$easu$e$ )ould beco&e
liable fo$ the clai&s fo$ inde&nit2 in cases )he$e none such )as due. -his cou$se )ould in ti&e
)$ec6 the =nsula$ -$easu$e$ and en$ich designing scound$els.A +B$ief, p. !5.,
-he appellant in said case No. ?7?7 obse$ved that abuse of confidence is the sa&e as
$obbe$2.
-he agent@s abuse of confidence is not co&pa$able to a $obbe$2. =f 'edasto 'ela%(ue% had
fo$ced the safe in )hich .$ego$ia /e$nande% 6ept he$ ce$tificate of title, had $e&oved the ce$tificate
the$ef$o& and )ith it had pe$fo$&ed all the othe$ acts i&puted to hi&, no negligence )hateve$ could
have been cha$ged to .$ego$ia /e$nande%, because the $obbe$2 )ould have been an unfo$eseen
and fo$tuitous event0 and no one can be held liable fo$ fo$tuitous happenings0 but abuse of
confidence is not a fo$tuitous event, unfo$eseen and unavoidable, $athe$ should it be fo$eseen and
avoided0 it is a )illful and delibe$ate act on the pa$t of the pe$son )ho co&&its the abuse, pe$haps
because of the indolence and negligence of the pe$son )$onged as )he$e a chec6boo6 is $eceived
f$o& the ban6 and the o)ne$ leaves it in the possession of a pe$son because he $eposes confidence
in such pe$son, if the latte$ should d$a) a chec6 against the ban6 the o)ne$ of the &one2 cannot
e8cuse hi&self f$o& liabilit2, because he stands convicted of negligence o$ failu$e to e8e$cise due
ca$e in safegua$ding his docu&ents of c$edit.
-his negligence, in the beginning, )as the $eason fo$ the $uling on the de&u$$e$, upon the sole
facts set up in the co&plaint in the p$eceding cause and $ecited in the fi$st pa$t of this decision. =n the
p$esent case, the sa&e plaintiff has offe$ed evidence of facts )hich sho) so&ething &o$e than
negligence, to )it, the giving of an oppo$tunit2 fo$ the abuse of confidence cha$ged against 'edasto
'ela%(ue% .<$o& the testi&on2 adduced b2 his )itnesses, )e ag$ee )ith the finding of the lo)e$
cou$t at the end of the 9udg&ent, to )it, that in the &ean)hile, o$ bet)een !"#3 and !"#?, .$ego$ia
/e$nande% because a)a$e of the f$aud co&&itted b2 'edasto 'ela%(ue%, but not)ithstanding that
fact she allo)ed t)o 2ea$s to pass befo$e b$inging cha$ges in cou$t. And it is not too &uch to asse$t
that the conve2ance &ade b2 'edasto 'ela%(ue% )as fo$ a conside$ation ag$eed upon bet)een
hi&self and .$ego$ia /e$nande%0 othe$)ise the$e is no e8planation of )h2, )hen de&and )as &ade
upon 'edasto 'ela%(ue% fo$ the docu&ents, he should have $eplied that on such and such a da2 he
)ould delive$, if not theone!, the docu&ent. Of )hat &one2 could he have spo6en that should ta6e
the place of the docu&ent de&anded of hi&C -he &one2 )hich both of the& e8pected in e8change
fo$ the docu&ent in case the land )as sold. Negligence is appa$ent, it being p$oven that .$ego$ia
/e$nande% had not lost sight of 'edasto 'ela%(ue% because he f$e(uented he$ house in the
&o$ning, in the afte$noon and at the siesta hou$, as one )itness testified, o$ because, acco$ding to
anothe$ )itness, he lived in the sa&e house as she did.
And though the negligence be co&pa$able to a theft it is ce$tain that, as p$esc$ibed in section
?? of Act No. 3"5, Ain case of the loss o$ theft of an o)ne$@s duplicate ce$tificate, notice shall be sent
b2 the o)ne$ o$ b2 so&e one in his behalf to the $egiste$ of deeds of the p$ovince in )hich the land
lies as soon as the loss o$ theft is discove$ed.A Ep to this date neithe$ .$ego$ia /e$nande% no$ the
plaintiff has fu$nished the $e(ui$ed notice to the $egiste$ of deeds of this cit2.
Even conside$ing the denial of the $ight of action against the assu$ance fund f$o& the point
vie) of the $egist$ation of the othe$ o)ne$ in the $egist$2, the defendant in the case at ba$, the action
fo$ $ecove$2 of possession he$e b$ought is i&p$ope$. -he$e is no $eason fo$ o$de$ing the $egiste$ of
deeds to cancel the $egist$ation A, C, and :, as $e(uested in the second p$a2e$ of the co&plaint.
=n the fi$st place, the fi$st insc$iption &ade in the na&e of .$ego$ia /e$nande% )ould not be
$evived b2 canceling these othe$. At the co&&ence&ent of his decision the t$ial 9udge sa2s that the
pu$pose of these p$oceedings is to obtain the cancellation of a $egist$ation of title in o$de$ to have the
$egiste$ substitute othe$ docu&ents in place of the one to be canceled and to $ecove$ possession of
a piece of p$ope$t2, togethe$ )ith the value of its use and occupation .-his cou$t has not found that
an2 petition had been &ade to have othe$ docu&ents substituted in place of those to be canceled.
-he second p$a2e$ of the co&plaint $eads lite$all2 as follo)s* A-hat the defendant $egiste$ of deeds
be o$de$ed to cancel the ent$2 o$ $egist$ation of the docu&ents A, C, and :, and to cancel and annul
the ce$tificates Nos. 3 and ;55.A
/ad .$ego$ia /e$nande%, in due season, co&plied )ith he$ dut2 to notif2 the $egiste$ of deeds
of the loss of he ce$tificate No. !2! and had then petitioned the cou$t to cancel the $egist$ation of the
docu&ent A, and had the cou$t dec$eed the sa&e and o$de$ed the $egiste$ of deeds to cancel all
$egist$ations subse(uent to the o$iginal one &ade in the na&e of .$ego$ia /e$nande%, he )ould
have p$oceeded in enti$e confo$&it2 )ith la). A=n all cases of $egist$ation p$ocu$ed b2 f$aud,A sa2s
the la), Athe o)ne$ &a2 pu$sue all his legal and e(uitable $e&edies against the pa$ties to such
f$aud. . . . Afte$ the t$ansc$iption of the dec$ee of $egist$ation on the o$iginal application, an2
subse(uent $egist$ation unde$ this Act p$ocu$ed b2 the p$esentation of a fo$ged duplicate ce$tificate,
o$ of a fo$ged deed o$ othe$ inst$u&ent, shall be null and void.A
An2 pe$son othe$ than .$ego$ia /e$nande% )ould have e8e$cised all he$ $ights of action
against the pe$pet$ato$ of the f$aud, 'edasto 'ela%(ue%0 he )ould have b$ought p$oceedings fo$ the
abuse of confidence and fo$ the $ecove$2 of the ce$tificate of title No. !2!0 he )ould have p$osecuted
the autho$ fo$ the fo$ge$2 of the inst$u&ent E8hibit A0 in civil p$oceedings he )ould have sought to
annul the f$audulent sale contained in inst$u&ent E8hibit A0 he )ould have p$a2ed fo$ all the things
above &entioned )ith $ega$d to the cancellation of the $egist$ation of the docu&ent A and the $eent$2
of the o$iginal $egist$ation in he$ na&e, petitions )hich she has not &ade even no) in this co&plaint,
filed seven 2ea$s afte$)a$ds and )hich the$efo$e could not be and ce$tainl2 )e$e not g$anted b2 the
cou$t. -he lo)e$ cou$t &ade onl2 the follo)ing p$onounce&ent* A=t is dec$eed and o$de$ed that the
docu&ents ,as6ed A, C, and : and the ce$tificates nu&be$ed 3 and ;55 be canceled and annulled,
and that the $egiste$ of deeds be inst$ucted to $eco$d in his $egist$2 the said annull&ent and
$egist$ation.A Nothing is said in the 9udg&ent about substituting an2 docu&ents in place of those
canceled. As fa$ as the public is conce$ned, the o$iginal $egist$ation disappea$ed the ve$2 &o&ent it
)as substituted b2 the $egist$ation of the t$ansfe$ E8hibit A, )hich up to the p$esent ti&e stands
unchallenged in the $egist$2. =t $e&ained in the $egist$2 onl2 as an antecedent o$ 6e2 to the title of the
land in (uestion.
=t )as necessa$2 to institute p$oceedings fo$ the abuse of confidence, fi$st, in o$de$ to $ecove$
the ce$tificate of title No. !2!, as in a case of theft, and in o$de$ to be able to de&and its $eent$2 as a
conse(uence of the $eent$2 of the o$iginal $egist$ation0 second, in o$de$ to p$eclude all idea of
connivance bet)een the o)ne$ and the thief and ave$t the suspicion that the loss o$ theft )as
feigned and ag$eed upon, especiall2 as the o)ne$ and the thief )e$e, p$io$ to all of these events,
p$incipal and agent.
-he inte$est )hich .$ego$ia /e$nande% had in clea$ing up the situation and p$osecuting the
case )as fa$ g$eate$ than that of the public in e8acting its vengeance. =t is not 6no)n ho) the plaintiff
ca&e to hold and still holds in his possession ce$tificate No. !2!.
'edasto 'ela%(ue% has not been held to account fo$ the $esults of his )$ongful act. =ts effects
have fallen on thi$d pe$sons* =n the fi$st p$oceedings that thi$d pe$son )as the =nsula$ -$easu$e$0 in
these second p$oceedings, the thi$d pe$son is the pu$chase$ Ra&on <abie.
=n the second place, the lo)e$ cou$t has not set fo$th in his 9udg&ent an2 positive g$ound fo$
despoiling the defendant of his p$ope$t2 fo$ the pu$pose of $etu$ning it to the plaintiff as the
$ep$esentative of .$ego$ia /e$nade% ./e e8plicitl2 states that the defendant is the $ightful o)ne$ of
the land* the la) p$otects <abie because he pu$chased f$o& the o)ne$ p$eviousl2 $egiste$ed0 but
selecting a pa$ag$aph f$o& the p$evious decision of the >up$e&e Cou$t $eason fo$ deciding to the
cont$a$2, because ou$ decision )as a cont$a$2 one in that case and although it )as onl2 on a
de&u$$e$, 2et all the legal points thus decided a$e as binding as though the2 had been settled in a
final 9udg&ent.
-his >up$e&e Cou$t &ade no finding )hateve$ in that decision )ith $espect to the defendant
Ra&on <abie, no$ had it an2thing to decide, because <abie )as not a pa$t2 to the p$oceedings and
the p$oceedings had not $eached the stage )he$e a decision could be $ende$ed on the &e$its,
inas&uch as the2 had been b$ought befo$e us &e$el2 on the de&u$$e$ to the co&plaint.
=t is t$ue that this cou$t stated in that decision that if .$ego$ia /e$nande% had not been
negligent +this pa$t )as supp$essed b2 the t$ial 9udge in his citation, she could have cancelled
insc$iption A and 'ela%(ue%@ ce$tificate of title No. 3 and, conse(uentl2, <abie@s insc$iption C, not the
latte$@s ce$tificate of title )hich had not 2et been issued and )hich, as sho)n in these second
p$oceedings, )as not issued until afte$ the insc$iption of : )as &ade. =t does not appea$ that the$e
)as an2 e$$o$ on this point.
At the fi$st (uestion )as conside$ed in the light of the p$ovisions of the Mo$tgage 4a) of Cuba
and the Philippines and afte$)a$ds acco$ding to those of Act No. 3"5, in ag$ee&ent )ith Act No. !"#.
-he Mo$tgage 4a) of Cuba and the Philippines )as applied, because the appellant in that
suit, the plaintiff he$ein, sub9ected to the p$ovisions of that la) the follo)ing (uestion ./e said* ANo)
)e co&e to a stage of the p$oceedings si&ila$ to that discussed in the case of Me$chant vs. 4afuente
+? Phil. Rep., 57,, a suit that )as decided in acco$dance )ith the said Mo$tgage 4a). -his is ve$2
clea$ and cannot be denied, fo$ in acco$dance )ith the said Mo$tgage 4a) no e$$o$ )hateve$ )as
co&&itted b2 this cou$t in that p$onounce&ent. A$ticle 3 of the said la) positivel2 sa2s*
@Not)ithstanding the state&ents contained in the p$eceding a$ticle, the inst$u&ents o$ cont$acts
e8ecuted o$ covenanted b2 a pe$son )ho, acco$ding to the $egist$2, has a $ight the$eto, shall not be
invalidated b2 thi$d pe$sons, afte$ the2 have once been $eco$ded +as happens )ith $espect to <abie,
although late$ the $ight of the pe$son e8ecuting the& +let us call hi& 'ela%(ue%, is annulled o$
dete$&ined b2 vi$tue of a p$io$ deed not recorded, o$ fo$ $easons )hich do not clea$l2 appea$ f$o&
the $egist$2.@
Onl2 b2 vi$tue of a $eco$ded inst$u&ent +li6e that of /e$nande%, &a2 anothe$ late$
inst$u&ent +<abie@s, also $eco$ded, be invalidated to the p$e9udice of thi$d pe$sons, )ith the
e8ceptions &entioned in a$ticle 7" +)hich has nothing to do )ith the case,.
=n acco$dance )ith Act No. 3"5, the plaintiff, afte$ having secu$ed a 9udg&ent annulling the
spu$ious sale &ade b2 'ela%(ue% and o$de$ing the cancellation of the insc$iption A, should have
co&plied )ith the p$ovision of section 7! of the said Act, that is to sa2, he should have $e(uested the
$egist$ation of the said 9udg&ent. -he cle$6 of the cou$t )ould then have issued a ce$tified cop2
the$eof add$essed to the $egiste$ of the p$ovince )he$e the p$ope$t2 is situated, and the latte$ )ould
have ente$ed upon the p$ope$ ce$tificate of title a eorandu to this effect, that is, upon $ead as to
'ela%(ue%@ ce$tificate of title No. 3, )he$eon a &e&o$andu& had been &ade of the insc$iption C in
<abie@s behalf, and he )ould have $eco$ded anothe$ &e&o$andu& in )itness of the annul&ent of
the f$audulent sale and the cancellation of the said spu$ious ce$tificate of title in favo$ of 'ela%(ue%.
Nothing of all this )as done.
Acco$ding to section ?? of the sa&e Act. AAfte$ the t$ansc$iption of the dec$ee of $egist$ation
on the o$iginal application, an2 subse(uent $egist$ation unde$ this Act p$ocu$ed b2 the p$esentation
of a fo$ged duplicated ce$tificate, o$ of a fo$ged deed o$ othe$ inst$u&ent, shall be null and void.A
Fuae$e* =s the insc$iption A, &ade in the na&e of 'edasto 'ela%(ue%, null and void on
account of its being f$audulent and in his ce$tificate No. 3 null and voidC =s the insc$iption C &ade in
the na&e of <abie, )hich appea$s on the bac6 of this ce$tificate, also null and voidC No, if it is sho)n
that <abie )as an innocent holde$, because the sa&e section of the Act 9ust above cited p$ovides*
A-hat in all cases of $egist$ation p$ocu$ed b2 f$aud the o)ne$ &a2 pu$sue all his legal and e(uitable
$e&edies against the pa$ties to such f$aud, without pre"udice to the $ights of an2 innocent holde$ fo$
value of a ce$tificate of title.A
-he defect )as that it )as not alleged in the fi$st co&plaint +-$ansc$ibed in the fi$st pa$t of this
decision, as it )as ag$eed upon in these second p$oceedings, that <abie )as an innocent holde$ of
a ce$tificate of title fo$ value and, conse(uentl2, in the de&u$$e$ no othe$ fact could be unde$stood as
ad&itted than that affi$&ed and in the &anne$ in )hich it )as affi$&ed in the co&plaint.
Fuestion* B2 the &e$e allegation &ade b2 the plaintiff in his co&plaint and accepted b2 the
defendant in the de&u$$e$, that 'edasto 'ela%(ue%, the noto$ious and convicted fo$ge$, had sold the
land to Ra&on <abie, can it be concluded that no one othe$ than <abie should be conside$ed to be
the o)ne$ of the land as being an innocent pu$chase$C =s not a 9udicial finding as to the o)ne$ship of
the land necessa$2, in o$de$ to 6no) )ho is $eal vested )ith the o)ne$shipC =s the affi$&ation of one
of the pa$ties sufficient to $esolve so difficult, se$ious and i&po$tant a p$oble&C
-his cou$t unde$stood and unde$stands, in ag$ee&ent )ith the Atto$ne2-.ene$al ,p. !2 of his
b$ief,, that it does not devolve upon the plaintiff and his atto$ne2 to decide )hethe$ Ra&on <abie is
o$ is not an innocent pu$chase$ fo$ value and )ithout 6no)ledge of the alleged f$aud o$ pa$ticipation
the$ein0 and in the a&ended co&plaint the$e is no sufficient allegation of fact to sho) that Ra&on
<abie is an innocent pu$chase$ fo$ value and that he had no 6no)ledge of the f$aud said to have
been co&&itted b2 'edasto 'ela%(ue%.
-he si&ple allegation contained in the co&plaint that <abie is a $egiste$ed innocent pu$chase$
is not the sa&e as that of his being a registered innocent pu$chase$. -he fact of the sale and the fact
of the $egist$ation a$e not sufficient to allo) the unde$standing that it )as also ad&itted in the
de&u$$e$ that he )as an innocentpu$chase$.
-he$e is no la) o$ doct$ine that autho$i%es such an inte$p$etation .-he plaintiff &ust set fo$th in
his co&plaint all the facts that necessa$il2 conduce to)a$d the $esult sought b2 his action. -he action
)as fo$ the pu$pose of $ecove$ing f$o& the assu$ance fund inde&nit2 fo$ the da&age suffe$ed b2 the
plaintiff in losing the o)ne$ship of his and as a $esult of the $egist$ation obtained b2 an innocent
holde$ fo$ value +pu$chase,. =t is a necessa$2 $e(ui$e&ent of the la) that the $egiste$ed p$ope$t2 shall
have been conve2ed to an innocent holde$ fo$ value )ho shall also have $egiste$ed his ac(uisition.
Necessa$il2 the co&plaint &ust sho) these facts as the2 a$e $e(ui$ed b2 the la). Bill it be
unde$stood as an indisputable fact, as res "udicata, that <abie )as an innocent pu$chase$ &e$el2
because the fact of the pu$chase and the fact of the $egist$ation )e$e alleged in the co&plaintC
A pe$son )ho, li6e 'edasto 'elas(ue%, 6ne) ho) to fo$ge a deed of sale in his o)n behalf
&ight ve$2 easil2 &a6e it appea$ that the p$ope$t2 )as sold to a thi$d pa$t2 G )ithout the 6no)ledge
of the said thi$d pa$t2 G and afte$)a$ds have the pu$chase $egiste$ed in the na&e of the thi$d pa$t2
so as to enable the s)indle$ to obtain f$o& the assu$ance fund P2",32# fo$ a piece of land )o$th
onl2 P?,###. Be do not sa2 that this actuall2 happened, but that it could have happened and )e
leave the pe$sons )ho have ta6en pa$t in this affai$ thei$ good na&e and $eputation intact. =f in the
opinion of the cou$ts the possibilit2 should e8ists, it is sufficient to p$eclude inte$p$etations and
p$esu&ptions. =t is not enough to alleged in the co&plaint the fact of the sale and the fact of the
$egist$ation in o$de$ that it &a2 be unde$stood to be ad&itted in the de&u$$e$ that the pu$chase$ )as
p$esu&abl2 innocent. /e &ight not have been innocent. =f the p$oceedings had gone fo$)a$d afte$
the allo)ance of the de&u$$e$ it &ight pe$haps be a (uestion as to )hose dut2 it )as to p$ove that
he )as o$ )as not an innocent pu$chase$, but at all events it cannot but be sho)n to the =nsula$
-$easu$e$ that the thing is i$$e&ediable, that the plaintiff@s o)ne$ship has been lost as to he$,
because an innocent thi$d pe$son holds the land and his o)ne$ship has been finall2 and i$$evocabl2
ente$ed in the $egist$20 Ain othe$ )o$ds,A sa2s the Atto$ne2-.ene$al in his b$ief +p. #,, Ain o$de$ that
the cou$t &a2 be info$&ed b2 the allegations of the co&plaint )hethe$ the said Ra&on <abie is an
innocent pu$chase$ fo$ value and has ac(ui$ed the title to said p$ope$t2 )ithout notice of f$aud o$
fo$ge$2 o$ an2 encu&b$ance, the cou$t is entitled to $e(ui$e the plaintiff to plead all the &ate$ial facts
in connection )ith the alleged t$ansfe$ and $egist$ation of title and on the t$ial in p$oof of his
allegations to p$esent in evidence a ce$tified cop2 of the ce$tificate of title o$ o)ne$@s duplicate
alleged to have been issued to said Ra&on <abie, togethe$ )ith the notations o$ indo$se&ents on
the bac6 of said ce$tificate of title . . . and the plaintiff &ust sho) the cou$t the $eason, if an2 the$e
be, )h2 the plaintiff did not in due ti&e pu$sue his legal and e(uitable $e&edies against the pa$ties to
the alleged f$aud.A Else)he$e in his b$ief, on page 27 the$eof, he also sa2s the follo)ing* A=t does not
appea$ )h2 .eo$gia /e$nande% did not file suit fo$ the annul&ent of the <$audulent sale b2 'edasto
'ela%(ue% until >epte&be$ 2?, !"#5, no$ does it appea$ )h2 .eo$gia /e$nande% o$ he$ agent did
not file the lis pendens )ith the $egiste$ of deeds unde$ section ;", Act No. 3"5, i&&ediatel2 upon
filing he$ suit in >epte&be$ 25, !"#5, instead of )aiting until Ma2, !"#; .-he$e is no allegation of
facts giving an2 $eason )h2 .$ego$ia /e$nande% did not ta6e steps bet)een 1anua$2 !7, !"#3, and
Nove&be$ ;, !"#3, the date of the alleged sale )ith pacto de retro, to have said false and f$audulent
deed and the ce$tificate of title issued the$eunde$ decla$ed null and void, as the la) sa2s the$e a$e.A
As 'ela%(ue% pe$pet$ated a c$i&e in o$de$ to appea$ in the $egist$2 as the o)ne$ of the land0
as the f$audulent sale appea$ing in the deed E8hibit A )as decla$ed to be null and void in !"#; and,
as the ce$tificate of title No .3 )as cancelled in conse(uence of the annul&ent of the $egist$ation A,
natu$all2 a doubt a$ose as to )hethe$ 'edasto 'ela%(ue%, )ho )as not the la)ful o)ne$ of the land,
could conve2 an2 $ight of o)ne$ship )hateve$ to Ra&on <abie in the land ac(ui$ed b2 the latte$0 and
a still g$eate$ doubt )hethe$, afte$ the cancellation of 'ela%(ue%@ ce$tificate of title, on the bac6 of
)hich noted the sale unde$ pacto de retro &ade to <abie, the &e&o$andu& still continued in effect.
-he natu$al conse(uence of the 9udicial decla$ation of the annul&ent of the sale of the land
and of the ce$tificate of title obtained b2 'ela%(ue% )as the filing of anothe$ suit to co&pel 'ela%(ue%
to $esto$e the possession of the land to .$ego$ia /e$nande% o$ to he$ agent and fo$ the cancellation
of the insc$iption A and the ce$tificate of title No. 3, Ra&on <abie being included in the p$oceedings,
because of his being the p$esent possesso$ and because the cancellation of the ce$tificate of title
containing a &e&o$andu& of his pacto de retropu$chase title &ight affect hi&. .$ego$ia /e$nande%
o$ he$ agent in the co&plaint si&ple states the fact of 'edasto 'ela%(ue% conve2ing the land to
Ra&on <abie b2 sale unde$ pacto de retro.
Ra&on <abie can de&u$ to the co&plaint of .$ego$ia /e$nande% o$ he$ agent, alleging the
facts set fo$th the$ein do not constitute a $ight of action, because the plaintiff &ust presue that he is
an innocent holde$ of a ce$tificate of title fo$ value, and, unde$ section ?? of Act No. 3"5, he can not
be sued b2 $eason of such ac(uisition. =t is ce$tain that in $epl2 the plaintiff )ould allege that in his
co&plaint he is not obliged to p$esu&e an2thing that he has onl2 to affi$& actual facts in suppo$t of
his $ight of action. =f no p$esu&ption &a2 be allo)ed in the co&plaint )ith $espect to the facts
alleged the$ein, )h2 &ust p$esu&ption be allo)ed in the ad&ission of the de&u$$e$C Necessa$il2
discussion )ould inevitabl2 fall upon the p$incipal fact in the case, to )it, )hethe$ Ra&on <abie is
an innocent holde$ of a ce$tificate of title fo$ value and the cou$t )ould finall2 decide )hethe$ he is o$
is not, in o$de$ to dete$&ine the p$op$iet2 o$ i&p$op$iet2 of the action fo$ $ecove$2 of possession. -he
=nsula$ -$easu$e$ )ould necessa$il2 have to have befo$e hi& a final 9udg&ent decla$ing <abie to be
an innocent holde$ fo$ value in o$de$ to conside$ the p$ope$t2 lost to one pe$son b2 $eason of the
$egist$ation of anothe$ as the o)ne$ the$eof. Bithout this, the$e is no cou$t that can o$de$ that an
o)ne$ be inde&nified out of the Aassu$ance fund.A
=n these p$oceedings it has onl2 been sho)n, b2 vi$tue of a stipulation of facts, that Ra&on
<abie is an innocent holde$ of a ce$tificate of title fo$ value0 conse(uentl2, in confo$&it2 )ith the oft-
cited section ?? of Act No. 3"5, he is the absolute o)ne$ of the land &entioned in the co&plaint, and
the action fo$ $ecove$2 of possession, i&p$ope$l2 b$ought against hi&, can in no )ise p$ospe$.
=t is i&p$ope$ to cancel the $egist$ations A, C, and : .-he last t)o, C, and :, the deeds of sale
unde$ pacto de retro and the final and absolute deed of sale e8ecuted b2 'edasto 'ela%(ue%, fo$ the
$eason that the2 a$e pe$fectl2 legal0 and the $egist$ation A, that of the sale fo$ged b2 'edasto
'ela%(ue% in his favo$, because, acco$ding to section 7 of Act No. 3"5, in case the$e be an innocent
pu$chase$ fo$ value, the dec$ee of $egist$ation f$audulentl2 obtained shall not be opened, but shall
$e&ain in full fo$ce and effect fo$eve$, sub9ect onl2 to the $ight of appeal .-his is the $egist$ation to
)hich Ra&on <abie found no ob9ection )hatsoeve$ and upon )hich the ce$tificate No .3 sho)ing
his $epu$chase )as issued .
=n tu$n the defendant as6s fo$ the cancellation of the notice of lis pendens &ade on the
ce$tificate of title No. ;55 issued as a $esult of the absolute sale. -his petition should be allo)ed,
because it )as sho)n b2 the plaintiff hi&self that such )as absolutel2 valueless.
=t is i&p$ope$ to ta8 the costs against <abie 9ointl2 )ith 'ela%(ue%, o$ in an2 othe$ &anne$,
because 'ela%(ue% )as not &ade a pa$t2 defendant, and because <abie is enti$el2 in the $ight.
-he 9udg&ent appealed f$o& is $eve$sed in so fa$ as it dec$eed the cancellation of the
docu&ents A, C, and : and the ce$tificates Nos. 3 and ;55, di$ects the $egiste$ to $eco$d the said
cancellation and o$de$s the possession of the land to be ad9udicated to the plaintiff, )ith the costs
against <abie and 'ela%(ue%0 and the 9udg&ent is affi$&ed in so fa$ as it denies the p$a2e$ fo$
da&ages and the pa2&ent of $ental. No special finding as to costs. so o$de$ed.
#ohnson, #., concurs.



PSe#$r$te O#%&%o&'

TORRES, J., concu$$ing*
-he unde$signed concu$s in the fo$egoing decision. /e believes, ho)eve$, that ce$tified copies
of the fo$ged deed and ce$tified copies of othe$ docu&ents and $eco$ds of p$oceedings in connection
the$e)ith, as &a2 be conductive to p$ove the co&&ission of the c$i&e, should be fo$)a$ded to the
Atto$ne2-.ene$al in o$de$ that he &a2 ta6e such action in the p$e&ises as the la) $e(ui$es.
CARSON, J., concu$$ing*
= concu$.
= a& satisfied that an e8a&ination of the second p$oviso in section ?? of Act No. 3"5 togethe$
)ith the conte8t, having in &ind the gene$al pu$pose and ob9ect sought to be attained b2 the
enact&ent of the statute as a )hole, leads to the conclusion that not)ithstanding the fact that afte$
the t$ansc$iption of the dec$ee of $egist$ation on the o$iginal application, an2 subse(uent $egist$ation
)hich is p$ocu$ed b2 the p$esentation of a fo$ged inst$u&ent is null and of no effect as bet)een the
pa$ties, it &a2 neve$theless be the $oot of a good title0 so that the title of a $egiste$ed o)ne$, )ho has
ta6en bona fide fo$ a valuable conside$ation, is not affected b2 $eason of his clai&ing th$ough
so&eone, the $egist$ation of )hose $ight o$ inte$est )as void because it had been p$ocu$ed b2 the
p$esentation of fo$ged inst$u&ents .= a& not una)a$e of the ob9ections )hich can be u$ged to this
const$uction of the statute, and especiall2 the ob9ections based on alleged constitutional li&itations
on the po)e$ of the local legislatu$e to enact the p$oviso thus const$ued. But si&ila$ p$ovisions have
been adopted b2 so&e of the >tates of the Enited >tates +cf. pa$. 7 of the Califo$nia Act, and until
the >up$e&e Cou$t of the Enited >tates shall have held to the cont$a$2, = a& not p$epa$ed to hold the
p$oviso unconstitutional and thus e&asculate the enti$e statute and )ea6en the confidence of the
public in the )hole s2ste&. = $ecogni%e the fo$ce of the a$gu&ent against the constitutionalit2 of the
p$oviso, but = do not dee& it of such conclusive fo$ce as to 9ustif2 the cou$t in decla$ing the statute
unconstitutional in this $ega$d.
= he$e inse$t so&e citations f$o& the co&&ent b2 Billia& C. Niblac6 in his Anal2sis of the
-o$$ens >2ste& of Conve2ing 4and, on the effect upon that s2ste& of fo$ge$2 +Chapte$ H=,, because
the2 (uite clea$l2 develop so&e of the difficulties conf$onting us the disposition of this case, and the
$easoning on )hich the cou$t &ust $el2 in its $uling on the va$ious contentions of the pa$ties.
=n so&e acts it is p$ovided that the p$oduction of the o)ne$@s duplicate ce$tificate,
)heneve$ an2 volunta$2 inst$u&ent is p$esented fo$ $egist$ation, shall be conclusive autho$it2
f$o& the $egiste$ed o)ne$ to the $egist$a$ of titles to ente$ a ne) ce$tificate o$ to &a6e a
&e&o$ial of $egist$ation in acco$dance )ith such inst$u&ent, and that a ne) ce$tificate o$
&e&o$ial shall be binding upon the $egiste$ed o)ne$ and upon all clai&ing unde$ hi&, in
favo$ of eve$2 pu$chase$ fo$ value and in good faith. Bhen a pe$son is dealing )ith land
$egiste$ed unde$ an act containing such a p$ovision, it see&s to be unnecessa$2 fo$ hi& to
$e(ui$e an2 othe$ evidence of the e8istence and identit2 of the $egiste$ed o)ne$ than the
p$oduction of the o)ne$@s duplicate ce$tificate, and it see&s that he &a2 $el2 on the validit2 of
a conve2ance f$o& the pe$son p$oducing such ce$tificate .=f this is the $ight const$uction of
this decla$ation, it validates the title of an innocent pe$son fo$ value, $el2ing on the p$oduction
of the ce$tificate, )ho is $egiste$ed as the i&&ediate $esult of a fo$ge$2 co&&itted b2 so&e
thi$d pe$son, and, in doing so, it goes one step be2ond the gene$al -o$$ens s2ste&, )hich
$e(ui$es that a $egist$ation be &ade unde$ the last $eal $egiste$ed o)ne$, in o$de$ to be
valid .=f the p$oduction of the last ce$tificate of title &a6es the ne) ce$tificate binding on the
$egiste$ed o)ne$ )hose na&e has been fo$ged, in favo$ of the ne) $egiste$ed pu$chase$ fo$
value and in good faith, then the latte$ 6eeps the title to the land, and the fo$&e$ $egiste$ed
o)ne$ is $e&itted to his $e&edies against the pe$son causing the loss and against the
inde&nit2 fund. =n .ibbs vs. Messe$, supra, and $% parte :ave2, supra, the o)ne$s@
duplicate ce$tificates )e$e p$oduced at the ti&e of the ne) $egist$ations, and if the 'icto$ia
and Ne) Iealand acts had decla$ed that the p$oduction of such a ce$tificate should &a6e a
&e&o$ial of $egist$ation binding on the last $egiste$ed o)ne$, in favo$ of a ne) $egiste$ed
pu$chase$ fo$ value in good faith, the decisions in those case &ight have been enti$el2
diffe$ent .-he intention of the legislatu$e &ust be ve$2 clea$, befo$e a cou$t )ill hold that a
pe$son $egiste$ed and clai&ing i&&ediatel2 unde$ a fo$ged inst$u&ent )ill ta6e an
indefeasible title b2 vi$tue of his $egist$ation, and it &a2 be ve$2 doubtful )hethe$, in enacting
the p$ovisions 9ust $efe$$ed to, the$e )as $eall2 an intent on the pa$t of the legislatu$e to
decla$e that the p$oduction of the last duplicate ce$tificate should validate a ne) ce$tificate,
even though it )as issued as the $esult of a fo$ge$2. =t is &uch &o$e p$obable that the
pu$pose of the p$ovisions )as to get a)a2 f$o& the suggestion that the $egist$a$ )as acting
in a 9udicial capacit2 )hen he &ade a $egist$ation, and to have the validit2 of a t$ansfe$
decla$ed unde$ the te$&s of a statute, $athe$ than to have it infe$$ed as a &atte$ of la) f$o&
the act and dete$&ination of the $egist$a$. Neve$theless, the p$ovisions see& to sho) a clea$
legislative intent, in an2 event and unde$ an2 ci$cu&stances, even in case of fo$ge$2, to vest
the title in the ne) $egiste$ed o)ne$, )heneve$ the last duplicate ce$tificate is p$oduced at
the ti&e of $egiste$ing the t$ansfe$.
Bhile the acts of Massachussets, /a)aii, and the Philippine =slands p$ovide that the
p$oduction of the o)ne$@s duplicate ce$tificate shall be conclusive autho$it2 to the $egist$a$ to
&a6e a ne) $egist$ation, that a ne) ce$tificate shall be binding in favo$ of eve$2 pu$chase$
fo$ value and in good faith, the$e is this (ualification* AAfte$ the t$ansc$iption of the dec$ee of
$egist$ation on the o$iginal application an2 subse(uent $egist$ation )hich is p$ocu$ed b2 the
p$esentation of a fo$ged duplicate ce$tificate, o$ of a fo$ged deed o$ othe$ inst$u&ent, shall be
null and void.A -his (ualification does not sa2 that an2 title founded on a fo$ge$2 shall be null
and void, but it &e$el2 sa2s that a $egist$ation p$ocu$ed b2 a fo$ged ce$tificate o$ othe$
inst$u&ent shall be void, but that such a $egist$ation &a2 be the $oot of a good title, and that
a pe$son $egiste$ed in good faith and fo$ value unde$ a p$io$ $egist$ation p$ocu$ed b2 fo$ge$2,
)hen the last ce$tificate is p$oduced, ta6e a valid title. 4oo6ed at f$o& this point of vie), the
th$ee acts 9ust &entioned si&pl2 decla$e the gene$al $ule )he$e the statute is silent on the
sub9ect of fo$ge$2, and a$e in effect the sa&e as the >outh Aust$alia, Califo$nia and Onta$io
statutes.
8 8 8 8 8 8 8 8 8
=f a -o$$ens act &a6es a title founded on a fo$ged inst$u&ent null and void, it $ende$s
ce$tificates of title clea$l2 defeasible, and tends to ta6e a)a2 the confidence of the public in
the&0 and if it &a6es a fo$ged inst$u&ent capable of beco&ing the $oot of a ne) title, it
upsets the long-che$ished and popula$ t$adition that a fo$ged inst$u&ent is absolutel2 void fo$
all pu$poses. -he English theo$2 that a landed p$op$ieto$ is to be p$otected as fa$ as possible
in his p$op$ieta$2 $ights &a2 be the basis of the deep-seated and gene$al feeling that a
pe$son ought not to lose his hand, unde$ an2 possible ci$cu&stances, b2 &eans of o$ as the
$esult of a fo$ge$2. One )ho does not unde$stand the $easons of the gene$al $ule, as to the
effect of fo$ge$2 unde$ the -o$$ens s2ste&, &a2 $ega$d it as a co&p$o&ise bet)een t)o
diffe$ent policies, but the $ule a$ises logicall2 f$o& ce$tain p$inciples of the title $egist$ation. A
p$oposed pu$chase$ of land )ho beco&es $egiste$ed o)ne$, gets no title to the land, loses
the &one2 he has paid on the p$oposed pu$chase, and has no $ecou$se to the inde&nit2
fund. /e has been guilt2 of negligence cont$ibuting to the loss, and his loss did not a$ise
f$o& ope$ations unde$ the act, because he dealt )ith a pe$son )ho )as not $egiste$ed unde$
the act, at least as to the p$ope$t2 in (uestion. Bhateve$ &a2 be the p$actical &e$its of the
theo$2, his case does not det$act f$o& the gene$al p$oposition that one $egiste$ed unde$ the
last $egiste$ed o)ne$ of an estate in land gets the title to the $egiste$ed estate. Bhe$e on in
good faith fo$ value is $egiste$ed as a ne) o)ne$ unde$ a pe$son )ho is $egiste$ed )ith a
title, invalid because it )as p$ocu$ed b2 fo$ge$2, one of t)o innocent pe$sons &ust lose the
land G eithe$ the o)ne$ f$o& )ho& the t$ansfe$ )as fo$ged o$ the $egiste$ed pu$chase$ f$o&
the $egiste$ed pe$son, )hose title )as invalid )hile he )as so $egiste$ed. =n the absence of
an2 constitutional li&itations on its po)e$s, it is co&petent fo$ the legislatu$e to sa2 )hich
one shall have the title, and in establishing a s2ste& of title $egist$ation, it is p$ope$ fo$ it to
decla$e, in favo$ of the last ce$tificate of title issued unde$ gove$n&ental autho$it2, that the
ne) $egiste$ed o)ne$ shall have it, and that the victi& of the fo$ge$2 shall be left to his
actions against the )$ongdoe$ and against the inde&nit2 fund. -he English act alone
decla$es the othe$ )a2 G that a $egist$ation obtained b2 fo$ge$2 is void fo$ all pu$poses, that
in case of fo$ge$2 the $egiste$ shall be $ectified, and that the pe$son suffe$ing loss b2 the
$ectification shall be entitled to the inde&nit2.
Be have discussed the effect of the fo$ge$2 of inst$u&ents $especting $egiste$ed land
as if the conditions of the la) )e$e the sa&e in this and in fo$eign count$ies. =n fo$egoing
count$ies the legislative po)e$ &a2 decla$e that the p$oduction of the last duplicate
ce$tificate of title shall be conclusive autho$it2 to a $egist$a$ to &a6e a ne) $egist$ation, and
&a2 decla$e also that a ne) $egist$ation on a t$ansfe$ f$o& the last $egiste$ed o)ne$ shall be
valid and shall be conclusive evidence of title. Bhen it decla$es that a $egist$ation void fo$
fo$ge$2 shall beco&e the $oot of a ne) title, in favo$ of a bona fide t$ansfe$ee fo$ value f$o&
the o)ne$ )hose ce$tificate )as issued as the $esult of the fo$ge$2, the$e is the end of it. But
in this count$2 the$e a$e constitutional li&itations on the po)e$ of the legislatu$e to pass la)s,
and no la) of a state &a2 dep$ive an2 pe$son of p$ope$t2 )ithout due p$ocess of la). -he$e
a$e &an2 decisions of cou$ts in this count$2 on the (uestion as to )hat is and )hat is not due
p$ocess of la), and, as the s2ste& developed, the -o$$ens statutes of this count$2 a$e li6el2
to s)ell the nu&be$ of the& ve$2 g$eatl2. Befo$e it can be said that the -o$$ens s2ste& is a
secu$e &ethod of conve2ancing and dealing )ith land in this count$2, it &ust be established
fi$&l2 that such statuto$2 decla$ations a$e valid and effective he$e. =n o$de$ to )o$6 the
s2ste&, ce$tificates &ust vest an indefeasible title, and it )ill not do to deal )ith $egiste$ed
land unde$ a s2ste& )he$e an2 $egist$ation, no &atte$ ho) fa$ bac6, &a2 be set aside as
void. =n England lando)ne$s c$ied out vehe&entl2 against a statute )hich gave effect to a
title founded on a fo$ge$2. -he2 )e$e &o$e conce$ned about holding the lands the2 had than
about an i&p$oved s2ste& unde$ )hich the2 &ight ta6e title to othe$ lands, and the2 $efused
to put thei$ lands unde$ the Act of !7;?. =n f$a&ing the Act of !7"; due $efe$ence )as paid to
this ob9ection to the -o$$ens s2ste&, and a $egist$ation founded on a fo$ge$2 )as decla$ed to
be absolutel2 void fo$ all pu$poses and a pe$son suffe$ing loss b2 the $ectification of the
$egiste$ )as given co&pensation f$o& the inde&nit2 fund. -his p$ovision, &a6ing all
$egist$ations unde$ a fo$ge$2 absolutel2 void, g$eatl2 i&pai$s the s2&&et$2 and effectiveness
of the English s2ste&, fo$ it is di$ectl2 cont$a$2 to the ca$dinal p$inciple that a bona fide
t$ansfe$ee fo$ value f$o& the last $egiste$ed o)ne$ holds a ce$tificate )hich is conclusive
evidence of title to $egiste$ed land. =f such statuto$2 decla$ations as )e have &entioned a$e
null and void unde$ ou$ constitutional li&itations, the A&e$ican, Onta$io an English s2ste&s
a$e p$acticall2 ali6e as to the $esult of a fo$ge$2, e8cept that no $ecou$se to the inde&nit2
fund is given in an2 of the A&e$ican statutes to the pe$son )ho &a2 suffe$ loss f$o& the
$ectification of the $egiste$. =t &a2 be that section 7 of the Califo$nia act is constitutional and
valid, but fo$ the dete$&ination of this &atte$, and of &an2 (uestions a$ising unde$ -o$$ens
statutes, )e &ust )ait until the sup$e&e cou$t of the Enited >tates has $ende$ed its decision.
MORELAND, J., dissenting*
= ag$ee )ith the t$ial cou$t in the disposition of this case and its 9udg&ent ought to be affi$&ed.
-he pa$ties sub&itted to the t$ial cou$t a stipulation of facts in )hich it )as ad&itted b2 the
defendant that the deed f$o& .eo$gia /e$nande% to 'edasto 'ela%(ue% )as fo$ged and that it had
been set aside upon that g$ound in an action instituted b2 .$ego$ia /e$nande% against 'edasto
'ela%(ue%. -he t$ial cou$t in its opinion as in this connection*
=t is alleged in the co&plaint and ad&itted b2 the stipulation that 'ela%(ue% on 1anua$2
!7, !"#3, p$ocu$ed the $egist$2 in his o)n na&e of that po$tion of decedent@s p$ope$t2 )hich
is he$e in (uestion, p$esenting fo$ that pu$pose a fo$ged inst$u&ent +E8hibit A,.
-he fact of fo$ge$2 and the cancellation of the fo$ged deed in the action $efe$$ed to a$e
ad&itted b2 both pa$ties on this appeal and nobod2 (uestions eithe$ of those facts in this Cou$t, no$
the fact that the $egist$ation )as p$ocu$ed f$audulentl2 b2 &eans of the fo$ged deed.
= thin6 the opinion of this cou$t is in e$$o$ in discussing an2 othe$ (uestion than that stated b2
the t$ial cou$t to have been sub&itted to it fo$ decision )hen it said* Athe (uestion is the$efo$e clea$l2
p$esented as to the $ight unde$ the -o$$ens land t$ansfe$ s2ste& of a bona fide pu$chase$ f$o& a
$egiste$ed holde$ )ho beca&e such th$ough the f$audulent $egist$ation of a fo$ged inst$u&ent.A -hat
)as absolutel2 the onl2 (uestion p$esented to o$ discussed o$ conside$ed b2 the t$ial cou$t. -he
defense of negligence o$ laches )as not offe$ed0 no$ )as that of estoppel o$ election of $e&ed2 o$
6ind$ed defense eve$ suggested .No$ have these defenses been offe$ed on this appeal. Not one of
the& is $elied on o$ even &entioned in the b$ief of counsel, and no o$al a$gu&ent the$eon has been
offe$ed .As = vie) the case, the$efo$e, none of these (uestions is befo$e this cou$t. -he sole (uestion
p$esented fo$ ou$ conside$ation, the plaintiff not having appealed, is )hethe$ o$ not the conve2ance
to <abie b2 'ela%(ue%, )hose title )as obtained b2 &eans of a fo$ged deed, dep$ived .$ego$ia
/e$nande% and he$ successo$s in inte$est of the p$ope$t2, it being conceded that <abie )as an
innocent pu$chase$ fo$ value.lawphi l.net
=n &2 9udg&ent, section ?? of Act No. 3"5 is conclusive of the case. -he second pa$ag$aph of
that section p$ovides that Athe p$oduction of the o)ne$@s duplicate ce$tificate )heneve$ an2 volunta$2
inst$u&ent is p$esented fo$ $egist$ation shall be conclusive autho$it2 fo$& the $egiste$ed o)ne$ to the
cle$6 o$ $egiste$ of deeds to ente$ a ne) ce$tificate o$ to &a6e a &e&o$andu& of $egist$ation in
acco$dance )ith such inst$u&ent, and the ne) ce$tificate o$ &e&o$andu& shall be binding upon the
$egiste$ed o)ne$ an upon all pe$sons clai&ing unde$ hi&, in favo$ of eve$2 pu$chase$ f$o value and
in good faith.A -he$e a$e, ho)eve$, t)o p$ovisos found in this sa&e pa$ag$aph, one of )hich has a
ve$2 &ate$ial bea$ing on the p$ovision 9ust (uoted in favo$ of Aeve$2 pu$chase$ fo$ value and in good
faith.A -he fi$st p$oviso deals )ith the $elations bet)een the o)ne$ and the pe$son )ho co&&its a
f$aud against hi& in the original registration, and decla$es that the p$ovision of section ?? shall not
inte$fe$e )ith his $ight of action against the )$ongdoe$ based upon the f$aud. -he second p$oviso
deals )ith the $elations bet)een the o)ne$ and a pu$chase$ in good faith and fo$ value and decla$es,
in effect, that the $ights of such pu$chase$ as confe$$ed b2 the section ust give wa! to those an
o)ne$ )ho has been dep$ived of his p$ope$t2 b2 a fo$ged duplicate ce$tificate o$ b2 a fo$ged deed o$
othe$ inst$u&ent. =t p$ovides*
And provided further, -hat afte$ the t$ansc$iption of the dec$ee of $egist$ation on the
o$iginal application, an2 subse(uent $egist$ation unde$ this Act p$ocu$ed b2 the p$esentation
of a fo$ged duplicate ce$tificate, o$ a fo$ged deed o$ othe$ inst$u&ent, shall be null and void.
-his language, as = vie) it, is so clea$ and co&p$ehensive that it leaves no $oo& fo$ doubt. =t is
a di$ect state&ent to the effect that the $ights of an innocent pu$chase$ fo$ value, and of eve$2 othe$
pe$son fo$ that &atte$, a$e subo$dinated and &ust give )a2 to the supe$io$ $ights of an o)ne$ )hose
p$ope$t2 has been ta6en a)a2 f$o& hi& b2 &eans of a fo$ged duplicate ce$tificate of title o$ a fo$ged
deed o$ othe$ inst$u&ent. =ndeed, the decla$ation of the statute is that a title so obtained is absolutel2
valueless no &atte$ into )hose hands it falls G it is null and void. 4anguage cannot be st$onge$ .
-he contention of counsel (uoted in the opinion of the t$ial cou$t to the effect that the Ap$oviso
su$el2 can onl2 &ean that such $egist$ation is null and void as bet)een the i&&eadiate pa$ties,A is
baseless. -he $ight of an o)ne$ of p$ope$t2 obtained in the na&e of the fo$ge$ to b$ing an action to
set aside that deed and to cancel the $egist$2 obtained unde$ it e8ists and e8isted unde$ the la) of
the land (uite as the p$ope$t2 $e&ains in the fo$ge$@s hands the$e can be no (uestion, the$e neve$
)as an2 (uestion, of the $ight of the o)ne$ to obtain an annul&ent of the deed and a cancellation of
the $egist$2 obtained the$eunde$. No p$ovision of the statute is $e(ui$ed to confe$ the $ight. =t e8ists
independent of section ?? and is a $ight of )hich the legislatu$e could not dep$ive hi& if it ti$ed. -he
contention is unsound fo$ anothe$ $eason. -he p$oviso unde$ discussion $efe$s to an innocent
pu$chase$ fo$ value and not to the fo$ge$. =t )as int$oduced into the section fo$ the pu$pose
of liiting the p$ivileges 9ust g$anted b2 anothe$ po$tion of the section to innocent purchasers for
value. A pe$son )ho fo$ges a deed to anothe$@s p$ope$t2 and obtains a $egist$2 in his o)n na&e
unde$ that fo$ged inst$u&ent is not a pu$chase$ fo$ value and in good faith .=ndeed, he is not a
pu$chase$ at all0 and, as a necessa$2 conse(uence, the p$oviso cannot $efe$ to hi& as it deals, as =
have said, )ith an innocent pu$chase$ fo$ value. =t touches the $elations bet)een the o)ne$ and the
innocent pu$chase$ and has nothing to do )ith the $elations bet)een the o)ne$ and the fo$ge$.
>uch being the case, the decisions cited b2 the t$ial cou$t in substantiation of his o)n pe$sonal
opinion as against that of the cou$t e8p$essed in the decision in the case of /e$nande% vs.
'ela%(ue% a$e not applicable, the$e being a statute in this 9u$isdiction dealing e8p$essl2 )ith the
sub9ect to )hich the decisions $efe$.
= cannot ag$ee to the conclusions )hich the concu$$ing opinion (uotes and adopts f$o&
AAnal2sis of the -o$$ens s2ste& of Conve2ing 4andsA b2 M$. Niblac6, found in his discussion of the
last p$oviso of section ?? unde$ conside$ation he$e. = do not desi$e in an2 &anne$ to c$itici%e the
autho$ o$ his ve$2 able )o$6. = $efe$ to and discuss ce$tain of his vie)s because the2 a$e a t2pe of
that e8t$e&e school )hich, it see&s to &e, needlessl2 sac$ifices eve$2thing to the inte$ests of the
innocent pu$chase$ fo$ value. >pea6ing of the li&itations of the p$oviso he sa2s*
-his (ualification does not sa2 that an2 title founded on a fo$ge$2 shall be null and
void, but it &e$el2 sa2s that a $egist$ation p$ocu$ed b2 a fo$ged ce$tificate o$ othe$ inst$u&ent
shall be void, and )e &a2 infe$ that unde$ such a statute the gene$al $ule applies, that a
$egist$ation p$ocu$ed b2 fo$ge$2 is void, but that such a $egist$ation &a2 be the $oot of a good
title, and that a pe$son $egiste$ed in good faith and fo$ value unde$ a p$io$ $egist$ation
p$ocu$ed b2 fo$ge$2, )hen the last ce$tificate is p$oduced, ta6es a valid title. 4oo6ed at f$o&
this point of vie), the th$ee acts 9ust &entioned si&pl2 decla$e the gene$al $ule )he$e the
statute is silent on the sub9ect of fo$ge$2, and a$e in effect the sa&e as the >uth Aust$alia,
Califo$nia and Onta$io >tatutes.
=n the fi$st place, if the fi$st pa$t of this state&ent has an2 &eaning, it &a6es a distinction
bet)een aregistration and a title founded on a $egist$ation. -his, in &2 9udg&ent, is un)a$$anted.
-he statute of the Philippine =slands a po$tion of )hich, na&el2, the last p$oviso of section ?? +Act
3"5,, &a6es no such distinction. =ndeed, b2 e8p$ess p$ovision, it $ende$s such a distinction
i&possible, and in the st$ongest te$&s p$ohibits a sepa$ation of the title f$o& the $egist$ation. >ection
?# of the Act +No. 3"5,p$ovides*
An o)ne$ of $egiste$ed land &a2 conve2, &o$tgage, lease, cha$ge, o$ othe$)ise deal
)ith the sa&e as full2 as if it had not been $egiste$ed. /e &a2 use fo$&s of deeds,
&o$tgages, leases, o$ othe$ volunta$2 inst$u&ents li6e those no) in use and sufficient in la)
fo$ the pu$pose intended .But no deed, &o$tgage, lease, o$ othe$ volunta$2 inst$u&ent,
e8cept a )ill, pu$po$ting to conve2 o$ affect $egiste$ed land, shall effect as a conve2ance o$
bind the land, but shall ope$ate onl2 as a cont$act bet)een the pa$ties and as evidence of
autho$it2 to the cle$6 o$ $egiste$ of deeds to &a6e $egist$ation. -he act of $egist$ation shall be
the ope$ative act to conve2 and affect the land, and in all cases unde$ this Act the $egist$ation
shall be &ade in the office of $egiste$ of deeds fo$ the p$ovince o$ p$ovinces o$ cit2 )he$e the
land lies.
<$o& this section it is clea$ that the registration is the title. Entil $egist$ation is acco&plished
the$e is nothing bet)een the pa$ties but Aa cont$actA )hich ope$ates si&pl2 as an Aautho$it2 to the
cle$6 o$ $egiste$ of deeds to conve2 and effect the land.A Ende$ the -o$$ens s2ste& he$e the o)ne$
cannot conve2 o$ give the title. /e is dep$ived of all po)e$ to do so. /e can onl2 give autho$it2 to the
cle$6 o$ $egiste$ to conve2. -he act of the cle$6 o$ $egiste$ in $egiste$ing the title is Athe ope$ative act
to conve2 and affect the land.A As a necessa$2 $esult, the $egist$ation is the title, is absolutel2 the
onl2 evidence of o)ne$ship, the onl2 &eans A)he$eb2 the o)ne$ of lands that the 9ust possession of
his p$ope$t2.A the$efo$e, if the $egist$ation is null and void, the$e is no title. -he fact that the
$egist$ation is null and void p$esents the occu$$ence of an2thing affecting the title0 and, $egist$ation
being the onl2 act )hich can c$eate title, none is c$eated and, the$efo$e, none t$ansfe$$ed .-he
(uoted state&ent )ould be &o$e in ha$&on2 )ith the p$ovisions and pu$poses of the statute if the
)o$d AtitleA )e$e $eplaced b2 the )o$d A$egist$ationA so that the state&ent )ould $ead * -his
(ualification does not sa2 that an2 registration founded on a $egist$ation p$ocu$ed b2 fo$ge$2 shall be
null and void, but it &e$el2 sa2 as that a $egist$ation p$ocu$ed b2 a fo$ged ce$tificate o$ othe$
inst$u&ent shall be void, etc. Bhat is &eant, as sho)n b2 subse(uent lines, is that the fo$ge$
$egist$ation is sound on its face and that if the land is t$ansfe$$ed to anothe$ and $egiste$ed in his
na&e that $egist$ation is good0 in othe$ )o$ds, a valid $egist$ation can be founded on a void
$egist$ation .Be &a2 ad&it this to be t$ue fo$ the pu$poses of the discussion0 but if t$ue it is not
because the void $egist$ation )as the A$ootA of a title but because, as to thi$d pe$sons, it )as the title
itself 0 not because it )as bad but could be $ipened o$ g$o)n into so&ething good, but because it
)as alwa!s good, the la) not pe$&itting it to be called bad, but conclusivel!p$esu&ing that, as to the
sold, it )as good fro the beginning0 not because it )as defective and could be co&pleted and
pe$fected b2 the subse(uent acts of so&ebod2, but because the$e neve$ )as a &o&ent )hen, as to
all the outside )o$ld, the $egist$ation )as not co&plete and pe$fect. =f the innocent pu$chase$ fo$
value could get an2thing b2 his $egist$ation based on the void $egist$ation, he got all the$e )as at
once0 and, if the fo$ged $egist$ation could give hi& an2thing at all, it could give hi& all. =t could not
give hi& the root of a title, it gave hi& the title itself . -he state&ent that the fo$ged $egist$ation, )hile
absolutel2 void bet)een the o)ne$ and the fo$ge$, )as valid as to an innocent pu$chase$ fo$ value
does not &ean the sa&e as the state&ent that a fo$ged $egist$ation A&a2 beco&e the root of a good
title.A =t distinguishes bet)een a title and an inchoate title, bet)een a co&plete and an inco&plete
tittle, bet)een a $oot of a good title and a good title, bet)een a title and a $egist$ation. -he statute
pe$&its of no such distinction.
Mo$eove$, if the title &a2 detach itself f$o& the $egist$ation and )ande$ about independent
the$eof, the$e is an end of the -o$$ens s2ste&0 fo$ then $egist$ation )ill not be the sole dete$&inant of
title, a necessit2 absolutel2 essential to the integ$it2 of that s2ste&. As to thi$d pe$sons, unde$ the
-o$$ens la) the$e a$e no e(uitable titles. 4egal title alone a$e those c$eated and sanctioned b2 that
la). No$ a$e the$e half-titles o$ (ua$te$ G titles o$ colo$ed titles o$ colo$s of title o$ $oots of title, o$
things that can $ipen into titles. Bhat the la) 6no)s is si&ple title G a co&plete title0 and unde$ it is
title o$ nothing. B2 e8p$ess p$ovision of that la) title is $egist$ation and $egist$ation is title.
=t is clea$, the$efo$e, that, )hen the autho$ spea6s of a void $egist$ation being the A$oot of a
good title,A he &ust be held to sa2 si&pl2 that a void $egist$ation is good as to pu$chase$s fo$ value
in good faith G )hich is the ve$2 p$oposition )e set out to discuss and )hich is one clea$l2
necessa$2 to discuss in vie) of the p$oviso )hich has p$ovo6ed all these )o$ds. -he )hole
discussion of the (uestion )hethe$ a fo$ged $egist$ation )ill p$otect an innocent pu$chase$ fo$ value
consists, then, si&pl2 in the state&ent that a void $egist$ation p$otects an innocent pu$chase$ fo$
value. Bhile this gets (uic6 $esults it is not altogethe$ satisfacto$2.
-he necessa$2 $esult of M$. Nilbac6@s discussion is that the p$oviso unde$ conside$ation
p$oduces no effect )hateve$ e8cept bet)een the o)ne$ and the fo$ge$.l awphil .net
-his theo$2 see&s to &e to be untenable. =n the fi$st place, if it be co$$ect the p$oviso does
nothing but set do)n the la) as it then e8isted0 fo$ it is absolutel2 void as bet)een the fo$ge$ and the
o)ne$. =f the p$oviso does no &o$e than decla$e that p$inciple, it does nothing. =n the second place,
the p$oviso ta6en in con9unction )ith the enacting clause to )hich it $elates $efe$s, as a &e$e &atte$
of language, to an innocent pu$chase$ fo$ value0 and the li&itation contained in the p$oviso is
p$ecisel2 a li&itation on the $ights of the innocent pu$chase$. =t is )ell $ecogni%ed that a p$oviso is a
clause eng$afted on a p$eceding enact&ent fo$ the pu$pose of $est$aining o$ &odif2ing the enacting
clause, o$ of e8cepting so&ething f$o& its ope$ation )hich othe$)ise )ould have been )ithin it0 and
that its app$op$iate office is to $est$ain o$ &odif2 the enacting clause and not to enla$ge it. Clea$l2 the
enacting clause he$e is Athe ne) ce$tificate o$ &e&o$andu& shall be binding upon the $egiste$ed
o)ne$ and upon all pe$sons clai&ing unde$ hi&, in favor of ever! purchaser for value and in good
faith.A No), the p$oviso, $efe$$ing di$ectl2 to this enacting clause, decla$es that Aan2 subse(uent
$egist$ation unde$ this Act p$ocu$ed b2 the p$esentation of a fo$ges duplicate ce$tificate, o$ fo$ged
deed o$ othe$ inst$u&ent, shall be null and void.A -o )hat does the p$oviso $efe$C Clea$l2 to the
decla$ation in favo$ of an innocent pu$chase$ fo$ value and to hi& alone. -he p$oviso is &eaningless
unless that be so. -he$e is no pe$son &entioned in the enacting clause bet)een )ho& the o)ne$
the p$oviso could possibl2 establish a $elation e8cept the innocent pu$chase$. -he innocent
pu$chase$ is alone na&ed in the enacting clause and the effect of the fo$ge$@s act on hi& is alone
decla$ed in the p$oviso. =t $e(ui$es no inte$p$etation o$ const$uction to $each this conclusion0 and =
have gone into it thus fa$ onl2 b2 )a2 of $epl2. =f the language of statutes )e$e loo6ed a2 b2 9udges
and autho$s )ith the sa&e abst$action )ith )hich the2 loo6 at o$dina$2 a$ticles in the ne)spape$s
the$e )ould be fa$ &o$e application and fa$ less inte$p$etation and const$uction of statutes. =f one
should $eceive a lette$ f$o& his )ife in )hich she sa2s that 2este$da2 she sent all of the child$en to
school e8cept 'i$ginia, it )ould ta6e no inte$p$etation o$ const$uction of the lette$, o$ involved
a$gu&ent, to dete$&ine )hich child )as not sent to school. =f a statute sa2s that a $egist$ation shall
p$otect an innocent pu$chase$ e8cept )hen it is obtained b2 fo$ge$2 it ta6es no conside$ation, o$
inte$p$etation, o$ const$uction, o$ fine distinctions, o$ involved a$gu&ent, to dete$&ine )hen a
$egist$ation does not p$otect an innocent pu$chase$. -his is p$ecisel2 )hat the p$oviso befo$e us
does. -he statute states that a $egist$ation shall be conclusive upon the o)ne$ and shall p$otect an
innocent pu$chase$ fo$ value e8cept )hen that $egist$ation is p$ocu$ed b2 fo$ge$2. :oes it $e(ui$e an2
inte$p$etation, o$ const$uction, o$ fine distinction, o$ involved a$gu&ent, to dete$&ine )hen an
innocent pu$chase$ is not p$otectedC
A )o$d no) as to the $elative &e$its of the -o$$ens s2ste& without the p$oviso and that s2ste&
)ith the p$oviso, assu&ing it to &ean )hat = contend it &eans. -he autho$ sa2s that a p$oviso
applied as = insist on appl2ing the one befo$e us Ag$eatl2 i&pai$s the s2&&et$2 and effectiveness of
the English s2ste&, fo$ it is di$ectl2 cont$a$2 to the ca$dinal p$incipleA )hich p$otects an innocent
pu$chase$ fo$ value@ and he co&plains against the English lando)ne$s )ho c$ied out vehe&entl2
against a statute )hich gave effect to a title founded on fo$ge$2 and he declai&s against the&
especiall2 because the2 $efused to out thei$ lands unde$ the -o$$ens Act of !7;?. =t occu$s to &e to
in(ui$e )h2 should not an o)ne$ st$enuousl2 ob9ect )hen, on going to bed at night, he 6no)s that
the ve$2 house in )hich he sleeps &a2 be stolen f$o& hi& befo$e he a$ises in the &o$ning. An &o$e0
he 6no)s that if it is stolen he )ill neve$ be able to $ecove$ it0 that his loss )ill be i$$evocable. /e
6no)s that, unde$ such a s2ste&, he is placed in a fa$ )o$se position that is he )ho has his )atch o$
his 9e)el$2 o$ his auto&obile o$ his ho$se stolen. -hese can be $eta6en )heneve$ found, no &atte$
th$ough ho) &an2 innocent hands the2 &a2 have passed0 but his house, his land, his ho&e, is lost
fo$eve$. Ende$ the benign and ult$a-civili%ed theo$ies of the -o$$ens s2ste& e8t$e&es, $eal estate
&a2 be stolen )ith $esults inco&pa$abl2 &o$e disast$ous to the o)ne$ than centu$ies of civili%ation,
of la) and o$de$, have pe$&itted to follo) the theft of pe$sonal p$ope$t2. Bh2 should the o)ne$ of
$eal estate not ob9ect )hen he is dealt )ith in such an unhea$d of &anne$C Bh2 should he not
p$otest )hen he is placed in a position )he$e the safest thing fo$ hi& to do )hen he $eceives his title
f$o& the >tate is to bu$n it up on the spot in o$de$ to insu$e hi&self against the loss of his lands b2
the theft of his titleC = have hea$d &uch tal6 about the p$otection of the innocent pu$chase$0 but =
have hea$d none about the p$otection of the innocent o)ne$. As = vie) it he is the one entitled to fi$st
conside$ation0 and an2 s2ste&, )hich, in its atte&pt to p$otect the innocent pu$chase$, goes to the
e8t$e&e of $ende$ing insecu$e the title of the innocent o)ne$ is essentiall2 vicious, is i$$e&ediabl2
bad. And the $idiculous thing about it is that such a s2ste& does not in $ealit2 p$otect the innocent
pu$chase$0 fo$ the ve$2 instant he hi&self beco&es the o)ne$ his o)ne$ship is as insecu$e as that of
the o)ne$ f$o& )hi& his pu$chase assisted in filching it. = contend that an2 s2ste& )hich $ende$ the
beneficial and effective o)ne$ship of $eal estate less secu$e in an2 given instance than that of
pe$sonal p$ope$t2 is inhe$entl2 )$ong.
= have hea$d &uch tal6 also of the As2&&et$2A of the -o$$ens s2ste&0 of its Ae&asculationA and
the defeat of its Aca$dinal p$incipleA and of the dest$uction of the Aconfidence of the publicA in the
s2ste&, b2 a failu$e to p$otect the innocent pu$chase$ fo$ value. But = have hea$d nothing about a
s2ste& )hich, in the ve$2 act of p$otecting an innocent pu$chase$, $ende$s his title insecu$e0 )hich
ope$ates advantageousl2 onl2 so long as the t$ansfe$ of o)ne$ship is continuous0 and )hich, )hen
the o)ne$ship stops in an2 given pe$son long enough to be stolen, puts the sta&p of its app$oval on
the theft of it. = have hea$d nothing about Ae&asculatingA the title of an innocent o)ne$0 o$ of
defeating Athe ca$dinal p$incipleA of o)ne$ship .No$ have = hea$d an2thing against a theo$2 )hich
sac$ifices the secu$it2 of o)ne$ship to the s2&&et$2 of a s2ste&.
But it &a2 be u$ged that the loss of title b2 theft and fo$ge$2 )ill be so inf$e(uent that the c$2 of
the o)ne$ of $eal estate against the s2ste& of the e8t$e&ists is not 9ustified. 'e$2 )ell0 let as ad&it
this0 but the ans)e$ is a conclusive de&onst$ation of the utte$ )ea6ness and futilit2 of the contention
and a$gu&ent of the opposition0 fo$ if the loss to the o)ne$ )ill be negligible unde$ that s2ste& then
fo$ the ve$2 sa&e $eason the loss to the innocent pu$chase$ )ould be negligible unde$ the othe$
s2ste&. Bh2, then change the status (uoC =f nothing is acco&plished b2 changing a p$inciple of la)
centu$ies old, )hich p$otects o)ne$s f$o& theft and $obbe$2 and all othe$ c$i&es against thei$
p$ope$t2, )h2 change itC =f nothing is gained )h2 change the incidence of loss f$o& )he$e it has
been placed fo$ gene$ations not onl2 b2 settled la), but also b2 uni&peachable p$inciples of $ight
and 9usticeC Ce$tain it is that if the loss of the title unde$ the -o$$ens s2ste& b2 fo$ge$2 )ill be so
inf$e(uent as not to distu$b the secu$it2 of o)ne$ship, and = ad&it that it )ill be, ho) can it affect the
As2&&et$2A of the s2ste&, o$ Ae&asculate the enti$e statute,A o$ A)ea6en the confidence of the public
in the )hole s2ste&,A o$ Ag$eatl2 i&pai$ the s2&&et$2 and effectiveness of the . . . s2ste&CA -o
p$ecisel2 the e8tent that unde$ such a s2ste&, t$ansfe$s a$e &ade secu$e, o)ne$ship is &ade
insecu$e. =f !#,### innocent pu$chase$ of -o$$ens lands lose the& in a single da2 in the cit2 of Manila
b2 $eason of the p$oviso unde$ discussion, the -o$$ens s2ste& )ith that p$oviso is $uined. But, on the
othe$ hand, if !#,### o)ne$s of -o$$ens lands can, )ithout the p$oviso, i$$evocabl2 lose those lands
in a single da2 in the cit2 of Manila b2 fo$ege$2 and theft, then also is the -o$$ens s2ste& )ithout
p$oviso $uined0 fo$ no s2ste& can stand )hich e8poses o)ne$ship in lands to such $is6s. But, if )e
accept the p$obabilities and satisf2 ou$selves that not &o$e than t)o cases of loss b2 fo$ge$2 )ill
occu$ in the Philippine =slands in 2# 2ea$s, then the -o$$ens s2ste&, as a s2ste&, )ill be )holl2
unaffected )hoeve$ is $e(ui$ed to lose. As a necessa$2 $esult, this c$2 about Ae&asculatingA the
s2ste& and dest$o2ing its As2&&et$2A and the loss of confidence in it because the innocent
pu$chase$ instead of the o)ne$ &ust lose, is as devoid of p$actical as it is of theo$etical basis. All =
contend fo$ is that, )hen the$e is a loss, it shall not be placed in the onl2 one )ho, unde$ settled la)
and in all 9ustice and e(uit2, ought not to lose.
= have neve$ hea$d that this $ight to $ecove$ stolen pe$sonal p$ope$t2 has &ade the business of
the pu$chase and sale of pe$sonal p$ope$t2 i&possible o$ the title the$eto insecu$e0 and the volu&e
of the business of bu2ing and selling pe$sonal p$ope$t2 is &an2 ti&es that )hich $elates to $eal
estate fo$ an2 given pe$iod. = have neve$ hea$d that the $ight of the o)ne$ to $eta6e a stolen
auto&obile has i&peded the auto&obile business an2)he$e. =t is clea$ that, as a p$actical &atte$, the
$e(ui$e&ent that the innocent pu$chase$ and not the o)ne$ of $eal estate lose in cases of fo$ge$2 )ill
not affect the p$actical value of the s2ste&.
= do not discuss the assu$ance fund. =t has no bea$ing on the (uestion involved. =f it had it
)ould be fa$ &o$e 9ust that the innocent pu$chase$ $athe$ than the innocent o)ne$ be $e(ui$ed to go
to it. Besides, if an o)ne$ be out$aged b2 a fo$ge$2 of title to his lands, that fact fu$nishes no $eason
)h2 the >tate should out$age hi& again b2 ta6ing advantage of the fo$ge$2 to dep$ive hi& of those
lands and tu$n the& ove$ to anothe$, offe$ing hi& in place the$eof the p$ivilege of beginning a la)suit
to see if he can get pa2 f$o& the assu$ance fund fo$ the lands of )hich the .ove$n&ent &ate$iall2
assisted in $obbing hi&.