A. DORONILA RESOURCES DEV., INC., PETITIONER, VS. COURT OF APPEALS AND THE REGISTER OF DEEDS OF RIZAL, RESPONDENTS.

Doronila Resources versus Court of Appeals

The Case

A. Doronila Resources Development, Incorporated, the petitioner, against the Court of Appeals and the Register of Deeds of Rizal, the respondents. This is a petition for review on certiorari, treated by the Supreme Court as a special civil action, of a decision of the Court of Appeals which affirmed the resolutions of the Land Registration Commission denying the registration of the petitioner's affidavit of adverse claim. The case matters because it settles a question every land-registration practitioner must know: whether a notice of lis pendens already annotated on a certificate of title bars the later registration of an adverse claim over the same property. The Supreme Court said no, and in doing so clarified the distinct characters of these two encumbrances.

Procedural History

The Register of Deeds of Rizal denied registration of the petitioner's affidavit of adverse claim. The petitioner then elevated the matter en consulta to the Land Registration Commission, which issued a resolution denying registration. The petitioner appealed to the Court of Appeals, which consolidated the two consultas and, on 26 November 1975, rendered a decision affirming the Commission. The petitioner then came to the Supreme Court by petition for review on certiorari, which the Court considered as a special civil action.

Facts

Blue Chips Projects, Incorporated was the registered owner of a large parcel of land in Barrio Patiis, San Mateo, Rizal, covered by Transfer Certificate of Title No. 344936 of the Registry of Deeds of Rizal. Blue Chips had purchased the property from Purita Landicho, the registered owner under an earlier transfer certificate of title. The petitioner, A. Doronila Resources Development, Incorporated, claimed that the property registered in the name of Blue Chips was a portion of a bigger parcel that the petitioner had purchased from Alfonso Doronila.

On 11 December 1972, the petitioner availed of the remedy of lis pendens in a civil case before the then Court of First Instance of Rizal, and this was annotated on Transfer Certificate of Title No. 344936. On 8 August 1973, the petitioner, through its President Alfonso Doronila, filed an affidavit of adverse claim for registration on the same title. The Register of Deeds of Rizal denied it, reasoning that the notice of lis pendens already registered on the title should bar the registration of an adverse claim, since the petitioner's rights were already amply protected and a second annotation would only burden the registered owner.

The petitioner brought the matter en consulta to the Land Registration Commission, which ruled against registrability. Meanwhile, Transfer Certificate of Title No. 344936 was cancelled and a new title, No. 425582, was issued in the name of Winmar Poultry Farms, Incorporated, with an annotation that the property was subject to the resolution in the first consulta. The petitioner then sought registration of an identical adverse claim on the new title. The Register of Deeds elevated the matter to the Commission, which maintained its earlier ruling. The Court of Appeals affirmed, and the petitioner came to the Supreme Court.

Issues

• Whether or not the annotation of a notice of lis pendens at the back of a certificate of title precludes the subsequent registration on the same or successor certificate of title of an adverse claim.

Applicable Provisions

The decision refers to Section 110 of Act 496, the old Land Registration Act, as the source of the remedy of an adverse claim, which the Court treats as one of the recourses a claimant may avail of:

And it would similarly be beyond reason to confine a claimant to the remedy afforded by Section 110 of Act 496 if there are other recourses in law which such claimant may avail of.

This bears on the case because it confirms that the adverse claim is an independent remedy that a claimant is not obliged to abandon simply because another remedy, such as a court action with lis pendens, is also available.

Ruling

The Supreme Court granted the petition. On the sole issue, it held that a notice of lis pendens does not preclude the subsequent registration of an adverse claim. The two remedies are not contradictory or repugnant to one another, and the existence of one does not automatically nullify the other. Both are intended to protect the interest of a claimant by posing as notices and cautions to those dealing with the property that it is subject to a claim.

The Court explained that a notice of lis pendens lasts only during the pendency of the action and may be cancelled under certain circumstances, as where the case is unnecessarily prolonged or the plaintiff fails to introduce evidence. A registered adverse claim, by contrast, may be cancelled only after the claim is adjudged invalid or unmeritorious. The Court put the distinction this way:

But, if any of the registrations should be considered unnecessary or superfluous, it would be the notice of Us pendens and not the annotation of the adverse claim which is more permanent and cannot be cancelled without adequate hearing and proper disposition of the claim.

The Court added that the annotation on the new title stating that the property was subject to the resolution of a consulta could not serve as a notice and warning to third persons that someone was claiming an interest in the property, because a consulta is merely the reference of a question by a Register of Deeds to the Commissioner of Land Registration when the Register is in doubt as to the proper step to take.

Doctrine

A notice of lis pendens and an adverse claim are not contradictory or repugnant to one another, and the existence of one does not automatically nullify the other. Both serve to protect a claimant's interest by giving notice and warning to persons dealing with the registered property. If either registration must be considered unnecessary or superfluous, it is the notice of lis pendens, not the adverse claim, because the adverse claim is more permanent and may be cancelled only after the claim is adjudged invalid or unmeritorious, upon adequate hearing and proper disposition. A claimant is not confined to the remedy of an adverse claim under Section 110 of Act 496 where other recourses in law are available, and the subsequent filing of an ordinary civil action does not divest an adverse claim of its validity.

Disposition

The petition was granted; the decision of the Court of Appeals and the resolutions of the Land Registration Commission were annulled and set aside, and the Register of Deeds of Rizal was directed to annotate the petitioner's affidavit of adverse claim on both Transfer Certificate of Title No. 344936 and Transfer Certificate of Title No. 425582, without costs.

Remember This

Memorize the line: if any registration is superfluous, it is the notice of lis pendens, not the adverse claim, which is more permanent and cannot be cancelled without adequate hearing. Examiners use this case to test the distinction between lis pendens and adverse claim, and whether one bars the registration of the other.