G.R. No. 23691. November 25, 1967
ARSENIO REYES, PETITIONER, VS. ANTONIO NOBLEJAS, IN HIS OFFICIAL CAPACITY AS LAND REGISTRATION COMMISSIONER AND JOSE SANTOS, IN HIS CAPACITY AS THE REGISTER OF DEEDS OF RIZAL, …
ANGELES, J.:
An appeal by certiorari to review the resolution of the Land Registration Commissioner,
dated August 25, 1964 – ordering the Register of Deeds of Rizal
to deny registration of the Deed of Sale and the Affidavit of Consolidation of
Ownership presented to him by herein petitioner. The main issue is, whether or not the period
of redemption of properties sold at public auction pursuant to an extrajudicial foreclosure of real
estate mortgage under Act No. 3135, as
amended by Act
No. 4118, is to be counted from
the date of the execution of the certificate of sale by the sheriff, or, from
the date of registration of the corresponding certificate of sale issued by the
sheriff in the Office of the Register of Deeds concerned.
For purposes of disclosing the law question involved, the
following statement of facts lifted from the resolution appealed from will
suffice:
“It appears from the facts of record that the spouses Leonardo
Gamboa and Aurora L. Cariaga
are the registered owners of the properties covered by Transfer Certificates
of Titles Nos. 18230, 18231, 18232, 18233 and 18234, of the Registry of Deeds
of Rizal.
These properties were mortgaged to the Philippine National Bank and upon
the failure of the mortgagors to pay the amount of the indebtedness upon maturity, the mortgage was foreclosed extrajudicially
under the provisions of Act No. 3135, as amended.
“On February 6, 1963,
the mortgaged properties were sold at public auction by the Provincial
Sheriff of Rizal for the sum of P6,010.00
in favor of Arsenio Reyes, the highest bidder, and
the corresponding certificate of sale was issued by the sheriff on February 21, 1963. In said certificate, the expiration date of
the period of redemption was fixed by the sheriff to be ‘one (1) year from and
after the date of the sale.’ It should be noted in this connection, that the
duplicate of the certificate of sale was not filed (registered) by the sheriff
in the office of the Register of Deeds.
A copy thereof which was attached to the Affidavit of Consolidation of
Ownership as a supporting paper, was neither entered
in the Primary Entry Book for Act 496.
“On February 10, 1964,
there were presented for registration in the Registry of Deeds of Rizal, an Affidavit of Consolidation of Ownership executed
on February 8, 1964, by the
auction-vendee, Arsenio Reyes, and a Deed of Sale
executed by the Philippine National Bank as attorney-in-fact of the mortgagee
(sic), in favor of the auction-vendee, Arsenio Reyes.
“The Register of Deeds denied the registration of the above-mentioned
documents on the ground that the period of redemption has not yet expired. In support of his opinion on the matter, the
Register of Deeds invoked the doctrine laid by the Supreme Court in the case
of Salazar v. Meneses, G. R. No. L-15378, promulgated
on July 31, 1963, wherein it was held that the rule that the period of
redemption in execution sales pursuant to Section 26 of Rule 39 of the Rules of
Court, which begins to run not from the date of sale but from the date of
registration of the certificate of sale, is also applicable in extrajudicial
foreclosure sales of registered land.
“Claiming that Section 6 of Act 3135, as amended, is so clear
on the point that the redemption period shall begin to run from the date of
sale, the petitioner, thru his counsel, disagreed with the ruling of the
Register of Deeds. Hence,
this appeal.”
As stated in the opening paragraph of this opinion, the Land
Registration Commissioner, upon the foregoing premises, promulgated the
resolution appealed from, ordering the Register of Deeds of Rizal to deny the registration of the Deed of Sale
executed by the mortgagee and the Affidavit of Consolidation of Ownership executed
by the auction-vendee, Arsenio Reyes, who presented
the said documents for registration. A
motion for reconsideration of
the resolution was subsequently denied by
the Land Registration Commissioner, hence, the instant petition for
review.
It is the theory of petitioner that in sales of property at
public auction pursuant to an extrajudicial foreclosure of real estate mortgage
under Act No. 3135, as amended by Act No. 4118, the period of redemption should
be reckoned from the date of the auction sale which, he contends, is the
express mandate of Section 6 of Act No. 3135:
“Section 6. In all cases in which the
extrajudicial sale is made under the special power hereinbefore referred to,
the debtor, his successors in-interest, or any judicial creditor or judgment
creditor of said debtor, or any person having a lien on the property subsequent
to the mortgage or deed of trust under which the property is sold, may
redeem the same at any time within the term of one year from
and after the date of sale; and such redemption shall be
governed by the provisions of sections 464 to 466, inclusive, of the Code of
Civil Procedure, insofar as these are not inconsistent with the provisions of
this Act.”
On the other hand, the Land Registration Commissioner is of the
opinion that the above-quoted provision is not the only pertinent and
controlling law on the matter, specially when it is
taken into consideration that the land involved is registered land under the Torrens
system. He maintains, and so held in the
resolution appealed from, that Section 6 of Act 3135 should be applied to the
present case together with: (1) sections
30 to 35 of Rule 39 of the Revised Rules of Court with regard to redemption;
(2) Section 27, Rule 39 of the said Rules and Section 71 of Act 496 with regard
to the filing (registration) of the sheriff’s certificate of sale; and (3) Section
50 of Act 496, with regard to
the registration of the certificate of sale
so as to consider
the land conveyed and affected under the Land Registration Act.
The ruling of the Land Registration Commissioner must be
sustained. Section 27, Rule 39 of the
Revised Rules of Court provides that the certificate of sale executed by the
sheriff in a public auction sale must be filed (registered) in the Office of
the Register of Deeds
of the province where the land is situated.
This is a mandatory requirement. Failure to register the certificate of sale
violates the said provision of law and, construed in relation with Section 50
of the Land Registration Law (Act 496), shall not take effect as a conveyance or bind the land
covered by a torrens title
because “the act of registration is the operative act to convey and affect
the land.” So the redemption period, for purposes of determining the time
when a final deed of sale may be executed or issued and the ownership of the
registered land consolidated in the purchaser at an extrajudicial foreclosure
sale under Act 3135, should be reckoned from the date of registration of the
certificate of sale in the office of the register of deeds concerned and not
from the date of the public auction sale.
To this effect is the holding in the case of Ernesto Salazar v. Flor de Lis Meneses,
L-15378, July 31, 1963, where this Court explained
at length this principle, as follows:
“The issue decisive of this appeal is the one raised by the
appellant in their third assignment of error, which is to this effect: That the lower court erred in not holding
that the period of redemption in this case, as far as appellants are
concerned, started only on May 26, 1956, the date when the
certificate of sale issued by the sheriff was registered. Should we rule to this effect, it is clear
that when the appellants attempted to exercise their right to redeem, as judgment
creditors of the deceased mortgagor by judgment subsequent to the
extrajudicial foreclosure sale, and when they instituted the present action on
October 1, 1956,
the period of redemption had not yet expired.
“We find
appellants’ contention to be meritorious.
In the case of Agbulos v. Alberto, G. R. No. L-17483,
promulgated on July 31, 1962, we held:
‘The property involved in the present case is registered land. It is
the law in this jurisdiction that when property brought under the operation of
the Land Registration Act is sold, the operative act is the
registration of the deed of conveyance.
The deed of sale does not ‘take effect as a conveyance, or bind the
land’ until it is registered (Section 50, Act 496; Tuason
v. Raymundo, 28 Phil. 635; Sikatuna v. Guevarra, 43 Phil. 371; Worcester
v. Ocampo, 34 Phil. 646). Undoubtedly, to be in consonance with this
well settled rule, Section 24, Rule 39 of the Rules of Court, provides that the
duplicate of the certificate of sale given by the sheriff who made the auction
sale to the purchaser must be filed (registered) in the office of the register
of deeds of the province where the property is situated.
‘In Garcia v. Ocampo,
G.R. No. L-13029, June 30, 1959,
we held that the twelve months period of redemption provided for in Sec. 26,
Rule 39 of
the Rules of Court “begins to run not from the date of sale, but from the
time of the registration of the sale in the office of the register of
deeds.” The entry or annotation on the back of the certificate of title of the property in question on July 18, 1959 (supra) was in accordance
with this ruling when it provided that the execution sale was “subject to redemption within one year from registration hereof.”
‘A case similar to the present is that of Gonzales et al v. Philippine National Bank et al. 48
Phil. 824, where we held that the provision of Section 32, Act 2938 (Charter of
the Philippine National Bank) providing
for a right of
redemption in favor of the bank’s mortgagor “within one year from the sale
of the real estate as a result of the foreclosure” should be construed to
mean one year after the confirmation of the foreclosure sale, because the sale
becomes valid only after the confirmation.
Along the same line we may say in this case that the period of one year after the sale must likewise start only
from the date of registration of the certificate of sale, because it is only
when that the certificate takes “effect as a conveyance” in
accordance with Act 496.’
“The above ruling is squarely applicable to the present case
which involves also registered land, inspite of the
fact that the sale in question is not an execution sale but a foreclosure
sale.”
But it is further argued by the petitioner that the rule should
not be applied to this case where there are no third parties involved. He cites a number of authorities,[1]
to the effect that as between the parties, registration is not necessary to
bind the immediate parties to a transaction involving registered land. He would then conclude that since the only
purpose of registration is to protect the buyer from third party claims, it
stands to reason that when, as in this case, there are no third party claimants
to the land, registration is not necessary and the sale between the parties
should be made to take effect from the date of the auction sale. We are not impressed by the argument. Apparently, herein petitioner failed to see
the “other side of the coin” and overlooked the doctrine, also well
settled, that the registration required by Section 50 of the Land Registration
Law is intended primarily for
the protection of innocent third persons, i.e., persons who, without knowledge
of the sale and in good faith, have acquired rights to the
property.[2] The same protection to third parties is obviously one
of the objects of Section 27, Rule 39 of the Revised Rules of Court in
requiring that the certificate of sale issued by the sheriff in an auction sale
be registered in the office of the register of deeds, for the purpose of the
legislature in providing for our present system of registration is to afford
some means of publicity so that persons dealing with real property may reach
the records and thereby acquire security against instruments the execution of
which has not been revealed. Redemption
is not the concern merely of the auction-vendee and the mortgagor, but also of
the latter’s successors in interest or any judicial creditor or judgment
creditor of said mortgagor, or any person having a lien on the
property subsequent to the mortgage under which the property has been
sold. It is precisely for this reason
that the certificate of
sale should be registered, for only upon
such registration may it legally be said that proper notice, though
constructive, has been served unto possible redemptioners
contemplated in the law. We have to
conclude, therefore, that the date of sale mentioned in Section 6 of Act 3135,
as amended, should be construed to mean the date of registration of the
certificate of sale in the office of the register of deeds concerned. Only after the lapse of the twelve-month
redemption period from the date of registration of the certificate of sale and
in the absence of any redemptioner within the said period, may the deed of final
sale be executed in favor of the purchaser who may then consolidate the title
of the property in his favor.
Consequently, We have to declare that the Land Registration Commissioner
was right in ordering the Register of Deeds of Rizal to deny the registration of the Deed of Sale and the
Affidavit of Consolidation of Ownership, the simultaneous registration of which
documents was sought by herein petitioner even before the
certificate of sale issued by the sheriff was registered.
WHEREFORE, and considering all the foregoing, the
resolution appealed from should be, as hereby it is affirmed, with costs
against herein petitioner.
Dizon, Acting C.J., Makalintal, Bengzon, Zaldivar, Sanchez, Castro, and
Fernando, JJ., concur.
Concepcion, C.J., and Reyes, J.B.L.,
J., on official leave of absence.
[1] Galanza v.
Nuesa, 95 Phil. 713 (1954); Evangelista v.
Montano, et al., 93 Phil. 275 (1953); Carillo v.
Salak de Paz, et al., 91 Phil. 265; Manuel v.
PNB, 101 Phil. 968.
[2]
See, Evangelista v. Montano, et al., supra.