BACOLOD-MURCIA MILLING CO., INC., PLAINTIFF AND APPELLANT VS. CONCEPCION DE LA KAMA DE VLLLARUZ AND JOSE MIRAFLORES, DEFENDANTS AND APPELLEES.

This is an appeal from a decision of the Court of First Instance of
Negros Occidental absolving Jose Miraflores from the complaint and
ordering Concepcion de la Rama de Villaruz to execute the necessary
deed of sale over lot No. 426-A of the cadastre of the City of Bacolod
in favor of the plaintiff within 30 days from the date she receives
copy of the decision.

On February 24, 1949, plaintiff filed a complaint alleging that in
1924, one Maria Maning was the owner of lot No. 426 of the cadastre of
the City of Bacolod with an area of 14,276 square meters, which she
inherited from her sister Procesa Maning, and that on October 13, 1924,
Maria Maning, in consideration of the sum of P2,000, sold to the
plaintiff lot No. 426-A, with an area of 7,544 square meters, being a
subdivision of lot No. 426; that after Maria Maning had sold to the
planitiff said lot and received the sum of P2,000, she promised to
execute the necessary deed of sale in order that the property may be
registered and the corresponding title issued in the name of the
plaintiff, but that Maria Maning died without having executed the
required deed of sale; that after the verbal contract of sale had been
made, plaintiff took possession of the property and had it -enclosed
with a wire fence and part occupied by its railroad track, and since
then plaintiff had been in possession and enjoyment of the property;
that after the demise of Maria Maning, her heirs effected the partition
of her estate and lot No. 426 was adjudicated to Concepcion de la Rama
and certificate of title No. 170-R (1.770) issued in her name; that
after the estate had been partitioned plaintiff demanded that
Concepcion de la Rama execute the deed of sale which her. mother had
promised over lot No. 426-A, which she acknowledged to be true and
promised in turn to carry out, but notwithstanding said acknowledgment
and promise, she has so. far failed to do so; and that on January 20,
1949, Concepcion de la Rama, with intent to defraud the plaintiff, sold
the aforesaid lot No. 426 with option to repurchase to Jose Miraflores,
who registered the sale in the office of the Register of Deeds.

On May 24, 1949, the defendants, through their counsel, submitted a
“provisional answer” denying generally the allegations of the complaint
but with a reservation to file an amended answer. As defendants
submitted their amended answer after a lapse of more than one year, the
same was objected to, and the objection was sustained. Then plaintiff
asked for judgment on the pleadings in view of defendants’ failure to
traverse the allegations of the complaint, and finding the motion well
taken, the court rendered judgment in the sense indicated in the early
part of this decision.

The only issue to be determined is whether the lower court erred in
not holding that Jose Miraflores did not act in good faith when he
bought the property in question from Concepeion de la Rama de Villaruz
in the light of the averments of the complaints; or stated in another
way, whether or not, under said averments, Miraflores may be considered
as a “bona fide purchaser for value without notice.’

Appellant contends that, having failed to deny specifically the
allegations of the complaint, Miraflores is deemed to have admitted
such allegations, one of them being that for 25 years, since 1924,
plaintiff had. been in possession, use, and enjoyment of the land in
question, which was enclosed by ‘a wire fence and part of it occupied
by the railroad track of the plaintiff, and that, with such.visible
structures on the land Miraflores should have taken the necessary
precaution to guard himself against the possibility of the existence
of an adverse claim to, or interest in, the property. Those visible
signs, appellant contends, are enough to place him on the look out and
make the necessary inquiry into the nature of the apparent encumbrance
of the property, and that, having failed to do so, he must be deemed
to have acted with negligence and must suffer the consequences.

This contention is untenable. Granting that Miraflores is deemed to
have admitted that the property in question had been for 25 years in
the possession of the plaintiff and was enclosed with a wire fence and
was partly occupied by the railroad track of the plaintiff, such
admission alone cannot serve as basis to impute bad faith to Miraflores
as there is nothing in the complaint which may in any way indicate that
he knew such possession and encumbrance when he bought the property
from its owner. It is a mere statement regarding the possession of the
land by the plaintiff but not an admission that Miraflores knew it when
the property was bought by him. Bad faith should be established by
competent proof to, overcome the presumption of good faith of a
purchaser for value without notice. Unless this proof is presented, a
purchaser shall be presumed to have acted in good faith (Cui and Joven vs.
Henson, 51 Phil., 606, 612). Moreover, it appears that plaintiff bought
the property from .Maria Maning almost 25 years ago and had been in
possession thereof during that long interregnum, but had done nothing
to protect its interest-for so long a time until the property was sold
to Miraflores. It merely relied on a promise which was never fulfilled.
“The law serves those who are vigilant and diligent and not those who
sleep when the law requires them to act” (Cui and Joven vs. Henson, supra).

“Action to Recover Property; Land Registration; Fraud; Good Faith; Presumption.—He
who seeks to recover a land from another who has registered it as his
through fraud, and from a third person who has bought it subsequently
from said person who appeared as the registered owner, must show that
this purchaser acted fraudulently, in order that a judgment may be
rendered against him, for he will be presumed to have acted, in good
faith until the contrary is proven” (Jacinto vs. Arellano, 48 Phil.,
570).

Another reason that should not be overlooked is the fact that the
property in question is registered under the Torrens System. Jose
Mirafiores bought the property relying entirely upon the certificate of
title registered. in the name of the vendor, which was free from any
claim or encumbrance. A Torrens title is a notice to all the world
(Legarda vs. Saleeby, 31 Phil., 590, 595). “A person dealing
with registered land is not required to go behind the register to
determine the condition of the property. He is only charged with notice
of the burdens on the property which are noted on the face of the
register or certificate of title. To require him to do more is to
defeat one of the primary objects of the Torrens System” (William H.
Anderson & Co. vs. Garcia, 64 Phil., 506). Miraflores cannot, therefore, be deemed as a purchaser in bad faith for lack of personal knowledge.

Wherefore, the decision appealed from is affirmed, with costs against the appellant.

Paras, C.J., Feria, Bengzon, Padilla, Tuason, Reyes and Jugo, JJ., concur.

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En mi
concepto, Miraflores no puede considerarse como comprador de buena fe,
si sabia que por 25 anos el terreno estaba en posesion de la
demandante, que estaba cercado por alambre espiho y ocupado por la
lfnea ferroviaria de la Central. Esos son datos suficientes para que un
comprador—que no desea atropellar derechos ajenos—investigue si hay
algun reclamante que no sea el vendedor. La falta de inscription a
favor de la demandante en el titulo del terreno no es suficiente razon
de buena fe. El camino de hierro en el terreno es aviso elocuente para
cualquier comprador.

En Ramirez contra el Sheriff Provincial de Pampanga y otros (42 Off. Gaz., 462), este Tribunal dijo:

“Solamente se puede invocar con exito la falta de inseripcion al
dorso del eertificado de titulo como pfueba de buena fe, cuando el
comprador no se entera de ningun dato que indique que el terreno ya es
de la propiedad de otro.”

Voto por la revocacion de la sentencia.