NATIVIDAD TRINIDAD VDA. DE CARVAJAL, PLAINTIFF-APPELLANT, VS. MARIA NATIVIDAD FLORENCIA CORONADO, CONRADA MARIA DE BELEN CORONADO, ERIBERTO APOLO CORONADO AND THE REGISTER OF DE…

On motion to
dismiss.
Defendants aver lack of cause of action. The lower court resolved to dismiss the
complaint.^[1]Hence, this appeal by
plaintiff in forma pauperis.^[2]

Material to the
present conflict are the following recitals of the
complaint:

During his lifetime, Januario Coronado was owner of a 1,007. 50 square-meter
land (Lot 12, Block 1075) situate at
Beata
Street, Pandacan, Manila. His title thereto was evidenced
by Transfer Certificate of Title No. 22035 of the land records of said city.
Januario Coronado failed to pay the real estate taxes
on the land aforesaid. In consequence, a portion thereof containing an area of
161.24 square meters, more or less, was sold at public auction by the City of
Manila on November 24, 25 and 26, 1930,
to plaintiff, Natividad Trinidad Vda. de Carvajal.

Neither the deceased Januario Coronado nor any of his heirs, successors or
assigns had redeemed the said portion of land.

Plaintiff took possession of the
portion sold to her immediately upon purchase, declared the same in her name for
tax purposes, paid the corresponding real estate taxes up to
1952.

Brigida Chuaquico Vda. de Coronado and
defendants Maria Natividad Florencia Coronado, Conrada Maria
de Belen Coronado, and Eriberto Apolo Coronado, pretending to be still the owners of the
portion sold to plaintiff at the tax sale, adjudicated among themselves the
whole of the land, caused the cancellation of Torrens title No. 22035, and the
issuance on March 15, 1954 – of Transfer Certificate of Title No. 35525 in their
names: Brigida Chuaquico
Vda. de Coronado, Conrada Maria de Belen Coronado, Maria Natividad Florencia Coronado, and
Eriberto Apolo
Coronado.

Brigida Chuaquico Vda. de Coronado died. Pursuant to the
extra-judicial settlement of her estate. Transfer Certificate of Title
No. 35525 was cancelled and Transfer Certificate of Title No. 54035 was issued
in the names of Conrada Maria de Belen Coronado, Maria
Natividad Florencia Coronado
and Eriberto Apolo Coronado.
This title also included the portion sold to plaintiff at the tax
sale.

Defendants Conrada Maria de Belen Coronado, Maria Natividad Florencia Coronado and
Eriberto Apolo Coronado,
“still with full knowledge that the 161.24 square meters sold to plaintiff as
stated above are no longer theirs, executed a partition agreement adjudicating
the whole property to defendant Maria Natividad Florencia Coronado alone. ” Transfer Certificate of Title
No. 54035 was cancelled and Transfer Certificate of Title No. 54047 was issued
and is still existing in the name of said Maria Natividad Florencia Coronado. This
Torrens title, as the previous ones,
includes the 161. 24 square-meter land purchased by plaintiff
at the November, 1930 tax sale.

The complaint further avers that
the three defendants aforementioned, “in causing the inclusion of the portion of
land with an area of 161. 24 square meters aforestated, which lawfully belongs to the plaintiff, in the
previous and in the new Transfer Certificate of Title No. 54047 and in other
documents of ownership”, did so “in evident bad faith” with “full knowledge that
they are not the owners”, and “neither [are] entitled to said portion of 161.24
sq. meters of land aforestated and with full knowledge
that the same was sold at public auction to the plaintiff for failure of their
father, Januario Coronado, to pay the corresponding
real estate taxes”; and that “furthermore, said defendants took advantage of
plaintiff’s ignorance of the law, to the damage and prejudice of said
plaintiff.”

Plaintiff also complains that
defendant Maria Natividad Florencia Coronado “is doing acts in violation” of
plaintiff’s proprietary rights over the said 161.24 square-meter
land.

The complaint winds up with the
prayer:

“(a) That plaintiff be declared
the real and absolute owner of said 161.24 square meters of land of Lot 12,
Block 1075 described in this complaint, which land is now covered by T. C. T.
No. 54047 of the Office of the Register of Deeds of
Manila;

(b) That the Register of Deeds of
Manila be ordered to cancel Transfer Certificate of Title No. 54047 and to issue
a separate title for said portion of 161.24 square meters in the name of the
plaintiff;

(c) That the defendants Maria
Natividad Florencia
Coronado, Conrada Maria de Belen Coronado, and Eriberto Apolo Coronado be ordered
to pay jointly and severally to plaintiff the sum of P850.00 as attorney’s fees
and to pay the costs of this suit;

(d) Plaintiff prays for such
other relief as may be just and equitable under the
premises.”

1. And now we come to the motion
to dismiss. Ground therefor is that the complaint does
not state facts sufficient to constitute a cause of action against defendants.
Because, so defendants say, the complaint does not allege “that the
corresponding officer’s return, or any deed, certificate, or affidavit, or any
other instrument made in the course of the proceedings to enforce the alleged
tax lien of the City of Manila on the property was ever filed with the Registry
of Deeds of the City of Manila and registered in the registration book and a
memorandum thereof made upon Transfer Certificate of Title No. 22035 as an
adverse claim or incumbrance“. And this, defendants
underscore, is a condition precedent to a statement of a cause of action, and
omission thereof is fatal.

Defendants’ mainstay is Section
77 of the Land Registration Act which reads:

“SEC. 77.A lien of any
description on registered land shall be enforced in the same manner as like
liens upon unregistered land. Whenever registered land is sold on execution, or
taken or sold for taxes or for any assessment, or to enforce a lien of any
character, or for any costs and charges incident to such liens, any execution,
or copy of execution, any officer’s return or any deed, demand, certificate, or
affidavit, or other instrument made in the course of proceedings to enforce such
liens and required by law to be recorded in the registry of deeds in the case of
unregistered land, shall be filed with the register of deeds for the province
where the land lies and registered in the registration book, and a memorandum
made upon the proper certificate of title, in each case, as an adverse claim or
incumbrance.”

They lean heavily on
jurisprudence that the one-year period^[3] for redemption of property
sold at a tax sale, begins to toll from the registration of the deed. The
philosophy behind such requirement of registration is that “it is one of the
safeguards that the law establishes in order that the owners of the land who may
have failed to take note of the sale of their properties for delinquency in
payment of taxes may be notified of the act taken in connection with their
properties”.^[4] This Court’s attention had
been called to “the common practice among purchasers, from whom the property may
be redeemed, to withhold the registration of the deed or certificate of sale
until after the lapse of one year, when the sale becomes final, thinking that if
registration were to be done earlier the owner or holder of the title would be
awakened on time, for incidentally he would be advised by the Register of Deeds
to surrender the title for annotation of the sale, preparatory to its
consolidation in the vendee after the lapse of one year. On the other hand, if
registration takes place after the lapse of the statutory period, the owner
would no longer have any mere opportunity to exercise his legal right of
redemption”.^[5]

2. But such registration, as
stated in the Santos decision, is but one of the
safeguards in order that the owner may have notice of the sale. Indeed, it is to
serve notice to all of the existence of the right recorded. Primarily, it is to
spur the owner to action to redeem the property within the one-year period on
pain of forever losing the same to the vendee. Therefore, if the party to be
affected had actual knowledge of the fact of the tax sale, then the purpose for which the registration had been established, as a
legal safeguard, is sufficiently complied with. As early as 1910, this Court has
ruled that [T]he purpose of registering an instrument relating to land x x x is to give notice to persons
interested of the existence” of legal rights “against the property” and that if
“the parties interested have actual notice of the existence” of the lien created
under said instrument, then “the necessity for registration does not exist”^[6] Really, the law does not
require the unnecessary. And registration in the situation just presented
becomes an act of supererogation. For actual knowledge of an unregistered sale
is equivalent to registration; it “is equivalent to a notice resulting from the
registry.”^[7] 3.

The validity of these precepts as
they apply to the owner of real property sold on a tax sale, is not to be underestimated. As a rule, a tax sale
brings about a price less than the actual value of the property. It is in this
posture that the property owner should take interest in protecting his property.
He cannot afford to shut his eyes, stand by supinely, or sit with folded arms.
He cannot lull the purchaser of his property – at a tax sale – into a false
belief that he (purchaser), already in possession, is secure in his right as
purchaser. He cannot let years go by, and in his own good time elect to
reacquire the sold property, to the prejudice of said purchaser. If the purpose
of the Torrens system is to quiet title to the
land – and all think it is – then this precept, far from being subserved, will be seriously dented. For, a situation may
well crop up where a cloud to the title to the land thus sold may remain for an
indefinite length of time. The basic dictates of fairness demand that the
property owner should not, after the statutory period from notice has lapsed, be
allowed literally to lay in ambush and then strike at the purchaser. Want of
honest dealing will not entitle one to shelter himself under the protective
mantle of the Land Registration Act. For the Torrens system only protects the title
holder in good faith; it has never been erected as a shield to fraud.^[8]

The factual averments of the
complaint are plain. The sale took place 111 November. 1930. Plaintiff
immediately took possession of the property sold to her. That the complaint does
not allege registration of the sale in her favor, is
not important now. The complaint avers defendants’ knowledge – since before
March 15,
1954 –
that such tax sale took place.^[9] Whether those averments
could be proved is one thing. But at this stage of the proceedings, equitable
considerations demand that the rights of the parties be determined at the
crucible of a trial on the merits. Specially because,
nothing in the complaint suggests that plaintiff is a fraudulent vendee. On the
contrary, she there avers that defendants took advantage of her (plaintiff’s)
ignorance of the law and made transfers of title in bad
faith.

No reason then exists why we
should take the present case out of the controlling principle that actual
knowledge is equivalent to registration. We are fortified in our view by the
statement we made in Santos vs.
Rehabilitation Finance Corporation, et al., supra, that the
landowner’s knowledge of a tax sale “is tantamount to
registration”.

Accordingly, a cause of action
exists. And the motion to dismiss should have been denied.

Upon the premises, we vote to
reverse the order of the trial court dismissing the case and to return the
record hereof to the court of origin for further proceedings.

SO
ORDERED.

Concepcion, C.J., Reyes, J. B. L., Dizon, Regala, Makalintal, Bengzon, J. P., Zaldivar and Ruiz Castro, JJ.,
concur.

 Barrera, J., on leave.

^[1] Civil Case No. 42419, Court of
First Instance of Manila, entitled “Natividad Trinidad
Vda. de Carvajal, plaintiff, vs. Maria Natividad Florencia Coronado, et
al., defendants”.

^[2] Plaintiff appealed from the
order of April 30,
1960
dismissing her complaint and the order of June 18,
1960
denying her motion to reconsider the April 30 order. Because purely questions of
law are involved, the Court of Appeals (CA-G.R. No. 28020-R) certified the case
to this Court for review.

^[3] Section 70, Revised Charter of
the City of Manila, reads:

“SEC.
70. Redemption of real estate. -Within one year from the date
of sale the delinquent taxpayer, or anyone for him, shall have the right of
paying the city assessor and collector the amount of the public taxes,
penalties, and costs together with interest on the purchase price at the rate of
fifteen per centum per annum from the date of purchase to the date of the
redemption; x x x“

^[4]
Santos vs. Rehabilitation Finance
Corporation, et al., G.R. No. L-9796, July 31,
1957; emphasis
ours.

^[5] Ibid. See also; Metropolitan Water
District vs. Reyes, 74 Phil. 142, 149~-150; Tolentino
vs. Agcaoili, G.R. No. L-4349-51,
May 28,
1952, 91 Phil. 917-918; Techico vs. Serrano, G.R. No. L-12693, May 29,
1959

^[6] Obras
Pias, etc., vs. Devera
Ignacio, et al,. 7 Phil. 45 Sec. also: Quimson vs. Suarez, 45 Phil. 901, 905-906; Gustilo et al., vs. Maravilla, 48
Phil. 422,448; Ramos, et. al., vs. Dueño, et. at.,
50 Phil. 786, 790.

^[7] Winkelman, et al., vs. Veluz, 43 Phil. 604, 608-609.

^[8] Quimson vs. Suarez,
supra, at 905-906; Gustilo, et al., vs.
Maravilla, supra, at 448; Ramos, et al., vs. Dueño, et al., supra, at 790.

^[9] The complaint here was filed on
January 21,
1960.