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THIRD DIVISION
[ G.R. No. 255934, July 13, 2022 ]
DEANNA DU, PETITIONER, VS. RONALD A. ORTILE[.] IN HIS CAPACITY AS DEPUTY ADMINISTRATOR OF THE LAND REGISTRATION AUTHORITY AND REGISTER OF DEEDS, CITY OF MANILA, RESPONDENTS.
D E C I S I O N
CAGUIOA, J:
Before the Court is the Petition for Review on Certiorari[1] (Petition) under Rule 45 of the Rules of Court filed by petitioner Deanna Du (petitioner Du) assailing the Decision[2] dated September 11, 2020 and Resolution[3] dated February 10, 2021 of the Court of Appeals[4] in CA-G.R. SP No. 156777. The CA Decision denied the Rule 43 petition for review filed by petitioner Du. The CA Resolution denied petitioner Du's Motion for Reconsideration (MR).
The Facts and Antecedent Proceedings
The CA Decision narrates the factual antecedents as follows:
The CA, in its Decision[6] dated September 11, 2020, found that petitioner Du's Rule 43 petition lacks merit.[7] The CA disagreed with Ortile's opinion that the annulment case's object is simply for the recovery of money because while petitioner Du prayed for damages, she mainly sought in the annulment case for Malayan Bank's compliance with their MOA in order to acquire the property, or the acknowledgment of her rights through the MOA over the subject property.[8] To the CA, the annulment case affects the title of the subject property.
Despite the above observation, the CA shared Ortile's view that for a notice of lis pendens to be annotated in the certificate of title, the registered owner must be impleaded as a party to the complaint.[9]
The CA denied the Rule 43 petition.[10] The dispositive portion of the CA Decision states:
Hence the present Petition. The Court issued its Resolution[13] dated March 2, 2022, requiring respondents to file their comment. Respondents, through the Office of the Solicitor General, filed their Comment[14] dated April 26, 2022.
The Issues
The Petition states the following issues to be resolved:
The Petition lacks merit.
Regarding the first issue, petitioner Du reiterates in her present Petition the arguments that she raised before the CA. She argues that nowhere in Section 76 of Presidential Decree No. (PD) 1529[16] is it required that the registered owner be impleaded as a party before a notice of lis pendens can be annotated.[17] She avers that the notice of lis pendens is merely an extrajudicial incident to constructively advise or warn all people who deal with the property of the pendency of the case affecting title thereto.[18] She cites Voluntad v. Spouses Dizon[19] (Voluntad) wherein this Court considered and allowed the annotation of the notice of lis pendens even if the registered owners were not parties to the subject litigation.[20]
The CA rejected these arguments of petitioner Du. As to its purpose, the CA stated that a notice of lis pendens is filed for the purpose of warning all persons that the title to a certain property is in litigation and that if they purchase the same, they are in danger of being bound by an adverse judgment; and that this is necessary in order to save innocent third persons from any involvement in any future litigation concerning the property.[21] The CA also noted that lis pendens has been conceived to protect the real rights of the party causing the registration thereof since such party could rest secure that he/she would not lose the property or any part thereof with the lis pendens duly recorded.[22] As to its effect, the CA acknowledged that a notice of lis pendens neither affects the merits of a case nor creates a right or a lien, being an extrajudicial incident in an action and a constructive advice or warning to all people who deal with the property that they so deal at their own risk, and whatever rights they may acquire in the property in any voluntary transaction are subject to the results of the action.[23] Nonetheless, the CA conceded that even if the notice of lis pendens would not create a right or lien over the property, it will definitely be an inconvenience or a burden, however slight, on the title of the registered owner.[24] The CA concluded that justice and fair play require that the registered owner be rightfully informed of the claim over his/her property by impleading them before an application for annotation of lis pendens be favorably acted upon.[25] Thus, the CA ruled that the registered owners Pacita Tuason and Pacita T. Principe should be impleaded as parties in the annulment case before a notice of lis pendens can be annotated in the property's certificate of title; otherwise, their as well as their heirs' right to due process would be infringed.[26]
Anent the second issue, petitioner Du insists that, contrary to CA's ruling, she has substantiated that: (1) the registered owners "Pacita Tuason and Pacita T. Principe," as appearing in the TCT, are one and the same person; and Melissa Principe is the sole heir of the registered owner.[27] She claims that in the Complaint filed with the RTC Branch 17, Manila City in Civil Case No. 13-130263, Melissa Principe admitted that Pacita Tuason Principe had passed away and as such, Melissa Principe, as sole heir, took it upon herself to file the Complaint with the court to protect what she believed to be her mother's interests.[28] Also, petitioner Du mentions that Melissa Principe alleged in the said Complaint that she and her late mother, Pacita Tuason Principe executed a real estate mortgage over the subject property to secure the payment of a promissory note in the amount of P4,500,000.00 in favor of Malayan Bank.[29] Further, petitioner Du, citing Ver-Reyes v. Court of Appeals, et al.[30] (Ver-Reyes), posits that the annotation of a notice of lis pendens should be allowed even if the registered owner is not a party to the pending litigation (the annulment case before the CA) because Pacita Tuason Principe, the registered owner, was the predecessor-in-interest of Melissa Principe, who is a party to the said pending litigation.[31] Lastly, petitioner Du argues that assuming arguendo that Melissa Principe is not the absolute owner of the subject property, the same has no bearing on the annotation of the notice of lis pendens since the latter has no legal effect that would cause a lien or encumbrance on the property involved and it will not in any manner prejudice the registered owner of the land since it is but a tool used to apprise unknowing parties of the present situation of the property.[32]
The CA was not convinced with petitioner Du's assertions regarding the second issue. The CA found that despite petitioner Du's claim that Pacita Tuason and Pacita T. Principe are the same person, no evidence was presented to prove the same. Also, petitioner Du's assertion that Melissa Principe is the sole heir of Pacita Tuason and Pacita T. Principe remained unsubstantiated. Thus, the CA took the stand that it could not support petitioner Du's avemrnnt that since Melissa Principe is impleaded in the annulment case the same is sufficient to compel the LRA to annotate the notice of lis pendens.[33]
The CA committed no reversible error.
The applicable provisions on notice of lis pendens are:
Sections 76 and 77 of PD 1529 or the Property Registration Decree, which provide:
In Villanueva v. Court of Appeals[34] (Villanueva), the Court noted that to annotate a notice of lis pendens, the following elements must be present: (1) the property must be of such character as to be subject to the rule; (2) the court must have jurisdiction both over the person and the res; and (3) the property or res involved must be sufficiently described in the pleadings.[35]
As to the first element, the Court observed that the remedy is available:
However, the Court takes the view that Section 76 of PD 1529 and Section 19, Rule 13 of the Rules impliedly require the registered owner to be a party or be impleaded as a party to such pending case. This interpretation of the said provisions is evident from the very nature of the action wherein a notice of lis pendens is appropriate, or from the first requisite enunciated in Villanueva: "the property must be of such character as to be subject to the rule."[40]
A notice of lis pendens is available only in an action "directly affecting the title to land or the use or occupation thereof or the buildings thereon," such as an "action to recover possession of real estate, or to quiet title thereto, or to remove clouds upon the title thereof, or for partition."[41] Since the rights of ownership are directly affected by the action, it is imperative that the registered owner/s, the very person/s appearing on the certificate of title as the owner/s, should be party/ies or impleaded as party/ies.
Firstly, it is for the protection of the registered owner. Since only registered lands and realty are covered by the said provisions, their interpretation must be consistent with the purpose of the Torrens system, which is to protect the registered owner first and foremost. While a notice of lis pendens serves as a warning to unsuspecting third persons and may not constitute yet a lien or encumbrance on the subject realty, it cannot be gainsaid that the right or claim or defense being asserted by the party seeking the recording or annotation of the notice in the title thereof is aimed directly against the realty. Thus, the annotation of a notice of lis pendens has a direct impact on the rights of the registered owner, which are in jeopardy of being curtailed.
Secondly, the annotation of a notice of lis pendens necessarily creates a cloud on the registered owner's certificate of title. This conclusion is supported by Article 476 of the Civil Code, which provides:
Admittedly, Section 77 of PD 1529 provides for the following ways to cancel a notice of lis pendens: (1) upon order of the court after proper showing that the notice is for the purpose of molesting the adverse party, or that it is not necessary to protect the rights of the party who caused it to be registered, before final judgment; (2) by the Register of Deeds, upon verified petition of the party who caused the registration thereof; or (3) upon the registration of a certificate of the clerk of court in which the action or proceeding was pending stating the manner of disposal thereof, after final judgment in favor of the defendant, or other disposition of the action such as to terminate finally all rights of the plaintiff in and to the realty involved. However, Section 19, Rule 13 of the Rules requires that: "The notice of lis pendens x x x may be cancelled only upon order of the court, after proper showing that the notice is for the purpose of molesting the adverse party, or that it is not necessary to protect the rights of the party who caused it to be recorded."[42]
If the registered owner is a party or impleaded as a party in the pending litigation and the notice of lis pendens is ordered annotated, then he/she will be able to have the notice timely cancelled after complying with the Rules. Thus, the cloud on his/her title could be removed at the earliest opportunity. On the other hand, if the registered owner is neither a party nor impleaded as a party, he/she may not even be aware that a notice of lis pendens has already been annotated on the original certificate of title on file with the Registry of Deeds. This is implied from Section 71 of PD 1529, which provides:
Once the registered owner becomes aware thereof, he/she may seek to intervene in the pending case referred to in the notice and seek its cancellation based on the grounds provided in PD 1529 and the Rules. If the pending case has been terminated, but the notice remains uncancelled, he/she will have to file the appropriate case to have it cancelled.
If the registered owner is not a party or impleaded as a party, he/she is expected to be always on guard for the possibility that a cloud, e.g., notice of lis pendens, may be cast upon his/her certificate of title. Not only will the cancellation of the notice entail expenses, it may take some time before an order of cancellation is obtained from the court. Worse, if the registered owner is in a hurry to dispose of his/her property for some emergency reason, the presence of a notice of lis pendens may be a deal breaker, or the price at which the same may be sold will necessarily be direly affected on account thereof.
The convenience afforded the registered owner is a valid and imperative argument to require that, at the outset, he/she is made a party or impleaded as a party in the pending case.
Thirdly, notifying the registered owner of the pendency of a case directly affecting the titled realty will prevent the commission of fraud upon the registered owner. As a party to the pending case, the registered owner can controvert whatever unfounded adverse claim the other parties may assert against the registered owner.
And, fourthly, as noted by the CA and enunciated by the Court in VerReyes, justice and fair play demand that the registered owner be made a party to the pending case; otherwise, the right of the registered owner to due process would be infringed, viz.:
Given the foregoing reasons, the CA correctly ruled that the registered owners, Pacita Tuason and Pacita T. Principe, should first be impleaded as parties to the pending case.
As mentioned earlier, petitioner Du, citing Ver-Reyes and Voluntad, claims that the Court has allowed the annotation of a notice of lis pendens even if the registered owner is not a party to the pending litigation provided that the party impleaded therein is the successor-in-interest of the registered owner.[44] She argues that such condition is met because Pacita Tuason Principe, the registered owner, was the predecessor-in-interest of Melissa Principe, who is a party to the said pending litigation.[45]
Indeed, the Court noted in Ver-Reyes:
Also, it must be noted that in Voluntad, the Voluntads, who were the successors-in-interest of Carmen and Maria Voluntad (the registered owners), themselves applied for the annotation of a notice of lis pendens. The factual backdrop of Voluntad is as follows:
The facts obtaining in Voluntad are incomparable to the facts of the instant case. Thus, Voluntad and the portion in Ver-Reyes reiterating Voluntad find no application in the present case.
As a final note, had petitioner Du not been obstinate and capitulated by complying with the requirement that the registered owners be impleaded, the case would not have dragged for six years and reached this Court, wasting in the process not only her time and resources but those of the adverse party and the courts. To stress anew, such requirement is not difficult to comply with.
WHEREFORE, the Petition is hereby DENIED. Accordingly, the Decision dated September 11, 2020 and Resolution dated February 10, 2021 of the Court of Appeals in CA-G.R. SP No. 156777 are AFFIRMED.
SO ORDERED.
Inting, Gaerlan, Dimaampao, and Singh, JJ., concur.
[.] Also "Ortille" in some parts of the rollo.
[1] Rollo, pp. 11-33, excluding Annexes.
[2] Id. at 38-44. Penned by Associate Justice Germano Francisco D. Legaspi, with Associate Justices Franchito N. Diamante and Walter S. Ong concurring.
[3] Id. at 45-46.
[4] Twelfth (12th) Division and Former Twelfth (12th) Division.
[5] Id. at 38-40.
[6] Supra note 2.
[7] Id. at 41.
[8] Id.
[9] Id.
[10] Id. at 43.
[11] Id.
[12] Supra note 3.
[13] Id. at 186-187.
[14] Id. at 189-201.
[15] Id. at 18.
[16] AMENDING AND CODIFYING THE LAWS RELATIVE TO REGISTRATION OF PROPERTY AND FOR OTHER PURPOSES," otherwise known as the "PROPERTY REGISTRATION DECREE," approved on June 11, 1978.
[17] Rollo, p. 23.
[18] Id.
[19] 372 Phil. 82 (1999).
[20] Rollo, p. 23.
[21] Id. at 42. Citation omitted.
[22] Id. Citation omitted.
[23] Id. at 42-43. Citation omitted.
[24] Id. at 43.
[25] Id., citing Ver-Reyes v. Court of Appeals, et al., 585 Phil. 503 (2008).
[26] Id., citing Ver-Reyes v. Court of Appeals, et al., id.
[27] Id. at 25.
[28] Id.
[29] Id. at 25-26.
[30] Supra note 24. It is noted that Ver-Reyes cited Voluntad.
[31] Rollo, pp. 27-28.
[32] Id. at 28.
[33] Id. at 43.
[34] 346 Phil. 289 (1997).
[35] Id. at 299. Citation omitted.
[36] Id. at 299-300. Citation omitted.
[37] Spouses Lim v. Vera Cruz, 408 Phil. 503, 505 and 508-509 (2001). Citations omitted.
[38] Magdalena Homeowners Association, Inc. v. Court of Appeals, 263 Phil. 235, 241 (1990). Citations omitted.
[39] Viewmaster Construction Corp. v. Maulit, 383 Phil. 729, 741-742 (2000). Citations omitted.
[40] Villanueva v. Court of Appeals, supra note 33, at 299. Citation omitted.
[41] PD 1529, Sec. 76. Emphasis and underscoring supplied.
[42] Emphasis and underscoring supplied.
[43] Ver-Reyes v. Court of Appeals, et al., supra note 24, at 512.
[44] See rollo, pp. 27-28.
[45] Id. at 28.
The CA Decision narrates the factual antecedents as follows:
Petitioner [Du] x x x averred that on June 25, 2008, Malayan x x x Savings and Mortgage Bank (Malayan Bank) purchased through a foreclosure sale, a parcel of land located at No. 2161 Taft Avenue, Malate, Manila covered by Transfer Certificate of Title (TCT) No. 194618 (subject property).Ruling of the CA
Thereafter, Malayan Bank entered into a memorandum of agreement (MOA) with petitioner [Du] and Primarosa B. Cuison (Cuison), wherein Malayan Bank agreed to sell the subject property for the amount of P20,500,000.00. Pursuant to the MOA, petitioner [Du] paid P11,000,000.00 as downpayment while Malayan Bank warranted that the subject property will be free from all liens and encumbrances by August 15, 2008. Malayan Bank incurred delays in performing its undertaking. Thus, petitioner [Du] sent a letter dated November 5, 2012 demanding Malayan Bank to fulfill its commitment. Still, Malayan Bank failed.
On September 4, 2013, Malayan Bank informed petitioner [Du] that it cannot fulfill its undertaking to free the subject property from all liens and encumbrances as an action for annulment of the foreclosure sale of the subject property was filed by Melissa Tuason-Principe (Melissa Principe), heir of the subject property's former owner, Pacita Tuason-Principe. Malayan Bank advised petitioner [Du] that it shall return all the amounts paid including the interest pursuant to their MOA. When Melissa Principe successfully redeemed the subject property, Malayan Bank reiterated its intention to rescind the MOA which was rejected by petitioner [Du]. It was found that Melissa Principe was able to reacquire the subject property through a compromise agreement with Malayan Bank which was approved by the Regional Trial Court [(RTC)] of Manila Branch 17.
Aggrieved petitioner [Du] filed a petition for annulment of judgment against Malayan Bank, George J. Martinez and Melissa Principe (annulment case) before [the CA) docketed as CA-G.R. SP No. 141881. Thereafter, petitioner [Du] filed a notice of [lis pendens] before the Register of Deeds of Manila (Register of Deeds).
On September 18, 2015, the Register of Deeds denied the registration of the notice of [lis pendens] on the ground that the registered owners of the subject property were not impleaded as parties in the petition. Petitioner [Du] filed an appeal by [consulta] before the Land Registration Authority (LRA) which was denied by [Ronald] Ortile [(Ortile)] in the assailed Resolution [dated June 6, 2018 of the LRA in Consulta No. 002-2015-000017 (LRA Resolution)). Aside from petitioner [Du's] failure to implead the registered owners in the petition, Ortile opined that a notice of [lis pendens] cannot be registered when the object of the proceeding is for the recovery of money. x x x
x x x x
Dissatisfied, petitioner [Du] filed [a petition for review via Rule 43 of the Rules of Court assailing the LRA Resolution].[5]
The CA, in its Decision[6] dated September 11, 2020, found that petitioner Du's Rule 43 petition lacks merit.[7] The CA disagreed with Ortile's opinion that the annulment case's object is simply for the recovery of money because while petitioner Du prayed for damages, she mainly sought in the annulment case for Malayan Bank's compliance with their MOA in order to acquire the property, or the acknowledgment of her rights through the MOA over the subject property.[8] To the CA, the annulment case affects the title of the subject property.
Despite the above observation, the CA shared Ortile's view that for a notice of lis pendens to be annotated in the certificate of title, the registered owner must be impleaded as a party to the complaint.[9]
The CA denied the Rule 43 petition.[10] The dispositive portion of the CA Decision states:
WHEREFORE, premises considered, the instant petition is DENIED.[11]Petitioner Du filed an MR, which the CA denied in its Resolution[12] dated February 10, 2021.
Hence the present Petition. The Court issued its Resolution[13] dated March 2, 2022, requiring respondents to file their comment. Respondents, through the Office of the Solicitor General, filed their Comment[14] dated April 26, 2022.
The Petition states the following issues to be resolved:
- Whether the CA erred in ruling that in the annotation of the notice of lis pendens, the registered owner should be impleaded as a party.
- Whether the CA erred in holding that there was no proof that the registered owners are one and the same person and that Melissa Principe is the sole heir of the registered owner.[15]
The Court's Ruling
The Petition lacks merit.
Regarding the first issue, petitioner Du reiterates in her present Petition the arguments that she raised before the CA. She argues that nowhere in Section 76 of Presidential Decree No. (PD) 1529[16] is it required that the registered owner be impleaded as a party before a notice of lis pendens can be annotated.[17] She avers that the notice of lis pendens is merely an extrajudicial incident to constructively advise or warn all people who deal with the property of the pendency of the case affecting title thereto.[18] She cites Voluntad v. Spouses Dizon[19] (Voluntad) wherein this Court considered and allowed the annotation of the notice of lis pendens even if the registered owners were not parties to the subject litigation.[20]
The CA rejected these arguments of petitioner Du. As to its purpose, the CA stated that a notice of lis pendens is filed for the purpose of warning all persons that the title to a certain property is in litigation and that if they purchase the same, they are in danger of being bound by an adverse judgment; and that this is necessary in order to save innocent third persons from any involvement in any future litigation concerning the property.[21] The CA also noted that lis pendens has been conceived to protect the real rights of the party causing the registration thereof since such party could rest secure that he/she would not lose the property or any part thereof with the lis pendens duly recorded.[22] As to its effect, the CA acknowledged that a notice of lis pendens neither affects the merits of a case nor creates a right or a lien, being an extrajudicial incident in an action and a constructive advice or warning to all people who deal with the property that they so deal at their own risk, and whatever rights they may acquire in the property in any voluntary transaction are subject to the results of the action.[23] Nonetheless, the CA conceded that even if the notice of lis pendens would not create a right or lien over the property, it will definitely be an inconvenience or a burden, however slight, on the title of the registered owner.[24] The CA concluded that justice and fair play require that the registered owner be rightfully informed of the claim over his/her property by impleading them before an application for annotation of lis pendens be favorably acted upon.[25] Thus, the CA ruled that the registered owners Pacita Tuason and Pacita T. Principe should be impleaded as parties in the annulment case before a notice of lis pendens can be annotated in the property's certificate of title; otherwise, their as well as their heirs' right to due process would be infringed.[26]
Anent the second issue, petitioner Du insists that, contrary to CA's ruling, she has substantiated that: (1) the registered owners "Pacita Tuason and Pacita T. Principe," as appearing in the TCT, are one and the same person; and Melissa Principe is the sole heir of the registered owner.[27] She claims that in the Complaint filed with the RTC Branch 17, Manila City in Civil Case No. 13-130263, Melissa Principe admitted that Pacita Tuason Principe had passed away and as such, Melissa Principe, as sole heir, took it upon herself to file the Complaint with the court to protect what she believed to be her mother's interests.[28] Also, petitioner Du mentions that Melissa Principe alleged in the said Complaint that she and her late mother, Pacita Tuason Principe executed a real estate mortgage over the subject property to secure the payment of a promissory note in the amount of P4,500,000.00 in favor of Malayan Bank.[29] Further, petitioner Du, citing Ver-Reyes v. Court of Appeals, et al.[30] (Ver-Reyes), posits that the annotation of a notice of lis pendens should be allowed even if the registered owner is not a party to the pending litigation (the annulment case before the CA) because Pacita Tuason Principe, the registered owner, was the predecessor-in-interest of Melissa Principe, who is a party to the said pending litigation.[31] Lastly, petitioner Du argues that assuming arguendo that Melissa Principe is not the absolute owner of the subject property, the same has no bearing on the annotation of the notice of lis pendens since the latter has no legal effect that would cause a lien or encumbrance on the property involved and it will not in any manner prejudice the registered owner of the land since it is but a tool used to apprise unknowing parties of the present situation of the property.[32]
The CA was not convinced with petitioner Du's assertions regarding the second issue. The CA found that despite petitioner Du's claim that Pacita Tuason and Pacita T. Principe are the same person, no evidence was presented to prove the same. Also, petitioner Du's assertion that Melissa Principe is the sole heir of Pacita Tuason and Pacita T. Principe remained unsubstantiated. Thus, the CA took the stand that it could not support petitioner Du's avemrnnt that since Melissa Principe is impleaded in the annulment case the same is sufficient to compel the LRA to annotate the notice of lis pendens.[33]
The CA committed no reversible error.
The applicable provisions on notice of lis pendens are:
Sections 76 and 77 of PD 1529 or the Property Registration Decree, which provide:
SEC. 76. Notice of lis pendens. – No action to recover possession of real estate, or to quiet title thereto, or to remove clouds upon the title thereof, or for partition, or other proceedings of any kind in court directly affecting the title to land or the use or occupation thereof or the buildings thereon, and no judgment, and no proceeding to vacate or reverse any judgment, shall have any effect upon registered land as against persons other than the parties thereto, unless a memorandum or notice stating the institution of such action or proceeding and the court wherein the same is pending, as well as the date of the institution thereof, together with a reference to the number of the certificate of title, and an adequate description of the land affected and the registered owner thereof, shall have been filed and registered.Section 19, Rule 13 of the 2019 Proposed Amendments to the 1997 Rules of Civil Procedure (Rules), in turn, provides:
SEC. 77. Cancellation of lis pendens. – Before final judgment, a notice of lis pendens may be cancelled upon order of the court, after proper showing that the notice is for the purpose of molesting the adverse party, or that it is not necessary to protect the rights of the party who caused it to be registered. It may also be cancelled by the Register of Deeds upon verified petition of the party who caused the registration thereof.
At any time after final judgment in favor of the defendant, or other disposition of the action such as to terminate finally all rights of the plaintiff in and to the land and/or buildings involved, in any case in which a memorandum or notice of lis pendens has been registered as provided in the preceding section, the notice of lis pendens shall be deemed cancelled upon the registration of a certificate of the clerk of court in which the action or proceeding was pending stating the manner of disposal thereof.
Section 19. Notice of lis pendens. — In an action affecting the title or the right of possession of real property, the plaintiff and the defendant, when affirmative relief is claimed in his or her answer, may record in the office of the registry of deeds of the province in which the property is situated a notice of the pendency of the action. Said notice shall contain the names of the parties and the object of the action or defense, and a description of the property in that province affected thereby. Only from the time of filing such notice for record shall a purchaser, or encumbrancer of the property affected thereby, be deemed to have constructive notice of the pendency of the action, and only of its pendency against the parties designated by their real names.According to Section 76 of PD 1529 and Section 19, Rule 13 of the Rules, a notice of lis pendens is proper in: (1) an action to recover possession of real estate; (2) an action to quiet title to real estate, or remove clouds upon the title thereof; (3) an action for partition; and (4) other proceedings of any kind in court directly affecting the title to land or the use or occupation or possession thereof or the buildings thereon.
The notice of lis pendens hereinabove mentioned may be cancelled only upon order of the court, after proper showing that the notice is for the purpose of molesting the adverse party, or that it is not necessary to protect the rights of the party who caused it to be recorded. (14a)
In Villanueva v. Court of Appeals[34] (Villanueva), the Court noted that to annotate a notice of lis pendens, the following elements must be present: (1) the property must be of such character as to be subject to the rule; (2) the court must have jurisdiction both over the person and the res; and (3) the property or res involved must be sufficiently described in the pleadings.[35]
As to the first element, the Court observed that the remedy is available:
"x x x to all suits or actions which directly affect real property and not only those which involve the question of title, but also those which are brought to establish an equitable estate, interest, or right, in specific real property or to enforce any lien, charge, or encumbrance against it, there being in some cases a lis pendens, although at the commencement of the suit there is no present vested interest, claim, or lien in or on the property which it seeks to charge. It has also been held to apply in the case of a proceeding to declare an absolute deed a mortgage, or to redeem from a foreclosure sale, or to establish a trust, or to suits for the settlement and adjustment of partnership interests. [fn: 54 C.J.S., 577-578]As correctly observed by the CA, a notice of lis pendens has the following meaning, nature, purpose and effect:
It is not sufficient that the title or right of possession may be incidentally affected. Thus[,] a proceeding to forfeit the charter of a corporation does not deprive it of the power to dispose of its property, nor does it place such property within the rule of lis pendens, so that purchasers thereof may lose the property or right to the possession through the appointment of a receiver. [fn: Havemeyer vs. Superior Court, 84 Cal. 327, 18 Am. St. Rep. 192, 24 Pac. 121, 10 L.R.A. 627 x x x]
In order that the doctrine of lis pendens may apply, so that purchaser of property may be bound by the judgment or decree rendered, it is essential that there be in existence a pending action, suit or proceeding, and there can be no lis pendens because of the fact that an action or suit is contemplated. [fn: 54 C.J.S., 583]"[36]
Lis pendens is a Latin term which literally means a pending suit. Notice of lis pendens is filed for the purpose of warning all persons that the title to certain property is in litigation and that if they purchase the same, they are in danger of being bound by an adverse judgment. The notice is, therefore, intended to be a warning to the whole world that one who buys the property does so at his own risk. This is necessary in order to save innocent third persons from any involvement in any future litigation concerning the property.From the foregoing, it appears that there is no express requirement that the registered owner must be a party or impleaded as a party to the pending suit, a notice of which is sought to be annotated in the certificate of title of the subject realty. As worded, Section 76 of PD 1529 and Section 19, Rule 13 of the Rules do not categorically mandate such requirement.
x x x x
Lis pendens has been conceived to protect the real rights of the party causing the registration thereof. With the lis pendens duly recorded, he could rest secure that he would not lose the property or any part of it. For such notice serves as a warning to a prospective purchaser or incumbrancer that the particular property is in litigation; and that he should keep his hands off the same unless of course, he intends to gamble on the results of the litigation. Based on this principle as well as the express provisions of Sec. 14, Rule 13 of the 1997 Rules of Civil Procedure, as amended, only the particular property subiect of litigation is covered by the notice of lis pendens. x x x
x x x x
For purposes of annotating a notice of lis pendens, there is nothing in the rules which requires the party seeking annotation to show that the land belongs to him. In fact, there is no requirement that the party applying for the annotation of the notice must prove his right or interest over the property sought to be annotated. Hence, even on the basis of an unregistered deed of sale, a notice of lis pendens may be annotated on the title. And such annotation can not be considered as a collateral attack against the certificate of title. This is based on the principle that the registration of a notice of lis pendens does not produce a legal effect similar to a lien. It does not create a right or lien. It only means that a person purchases or contracts on the property in dispute subject to the result of the pending litigation.[37] (Underscoring supplied)
The notice of lis pendens — i.e., that real property is involved in an action — is ordinarily recorded without the intervention of the court where the action is pending. The notice is but an incident in an action, an extrajudicial one, to be sure. It does not affect the merits thereof. It is intended merely to constructively advise, or warn, all people who deal with the property that they so deal with it at their own risk, and whatever rights they may acquire in the property in any voluntary transaction are subject to the results of the action, and may well be inferior and subordinate to those which may be finally determined and laid down therein. The cancellation of such a precautionary notice is therefore also a mere incident in the action, and may be ordered by the Court having jurisdiction of it at any given time. And its continuance or removal — like the continuance or removal of a preliminary attachment or injunction — is not contingent on the existence of a final judgment in the action, and ordinarily has no effect on the merits thereof.[38]
The Court must stress that the purpose of lis pendens is (1) to protect the rights of the party causing the registration thereof and (2) to advise third persons who purchase or contract on the subject property that they do so at their peril and subject to the result of the pending litigation. One who deals with property subject of a notice of lis pendens cannot acquire better rights than those of his predecessors-ininterest. In Tanchoco v. Aquino, the Court held:"x x x The doctrine of lis pendens is founded upon reason of public policy and necessity, the purpose of which is to keep the subject matter of the litigation within the power of the court until the judgment or decree shall have been entered; otherwise, by successive alienations pending the litigation, its judgment or decree shall be rendered abortive and impossible of execution. Purchasers pendente lite of the property subject of the litigation after the notice of lis pendens is inscribed in the Office of the Register of Deeds are bound by the judgment against their predecessors x x x."Without a notice of lis pendens, a third party who acquires the property after relying only on the Certificate of Title would be deemed a purchaser in good faith. Against such third party, the supposed rights of petitioner cannot be enforced, because the former is not bound by the property owner's undertakings not annotated in the TCT.
Likewise, there exists the possibility that the res of the civil case would leave the control of the court and render ineffectual a judgment therein. x x x
x x x Hence, until the conflicting rights and interests are threshed out in the civil case pending before the RTC, it will be in the best interest of the parties and the public at large that a notice of the suit be given to the whole world.
x x x Verily, there is no requirement that the right to or the interest in the property subject of a lis pendens be proven by the applicant. The Rule merely requires that an affirmative relief be claimed. A notation of lis pendens neither affects the merits of a case nor creates a right or a lien. It merely protects the applicant's rights, which will be determined during the trial.[39]
However, the Court takes the view that Section 76 of PD 1529 and Section 19, Rule 13 of the Rules impliedly require the registered owner to be a party or be impleaded as a party to such pending case. This interpretation of the said provisions is evident from the very nature of the action wherein a notice of lis pendens is appropriate, or from the first requisite enunciated in Villanueva: "the property must be of such character as to be subject to the rule."[40]
A notice of lis pendens is available only in an action "directly affecting the title to land or the use or occupation thereof or the buildings thereon," such as an "action to recover possession of real estate, or to quiet title thereto, or to remove clouds upon the title thereof, or for partition."[41] Since the rights of ownership are directly affected by the action, it is imperative that the registered owner/s, the very person/s appearing on the certificate of title as the owner/s, should be party/ies or impleaded as party/ies.
Firstly, it is for the protection of the registered owner. Since only registered lands and realty are covered by the said provisions, their interpretation must be consistent with the purpose of the Torrens system, which is to protect the registered owner first and foremost. While a notice of lis pendens serves as a warning to unsuspecting third persons and may not constitute yet a lien or encumbrance on the subject realty, it cannot be gainsaid that the right or claim or defense being asserted by the party seeking the recording or annotation of the notice in the title thereof is aimed directly against the realty. Thus, the annotation of a notice of lis pendens has a direct impact on the rights of the registered owner, which are in jeopardy of being curtailed.
Secondly, the annotation of a notice of lis pendens necessarily creates a cloud on the registered owner's certificate of title. This conclusion is supported by Article 476 of the Civil Code, which provides:
ART. 476. Whenever there is a cloud on title to real property or any interest therein, by reason of any instrument, record, claim, encumbrance or proceeding which is apparently valid or effective but is in truth and in fact invalid, ineffective, voidable, or unenforceable, and may be prejudicial to said title, an action may be brought to remove such cloud or to quiet the title.Since a cloud on the title is created when a notice of lis pendens is annotated, the registered owner should be given the opportunity to be able to protect his/her clean, or unblemished certificate of title. In the interregnum, while the cloud, i.e., notice of lis pendens, remains annotated in the certificate of title, the registered owner's right to dispose the property is unduly affected because a lucrative transfer may be hindered by the presence of the cloud. The very property is in limbo during such uncertain period.
Admittedly, Section 77 of PD 1529 provides for the following ways to cancel a notice of lis pendens: (1) upon order of the court after proper showing that the notice is for the purpose of molesting the adverse party, or that it is not necessary to protect the rights of the party who caused it to be registered, before final judgment; (2) by the Register of Deeds, upon verified petition of the party who caused the registration thereof; or (3) upon the registration of a certificate of the clerk of court in which the action or proceeding was pending stating the manner of disposal thereof, after final judgment in favor of the defendant, or other disposition of the action such as to terminate finally all rights of the plaintiff in and to the realty involved. However, Section 19, Rule 13 of the Rules requires that: "The notice of lis pendens x x x may be cancelled only upon order of the court, after proper showing that the notice is for the purpose of molesting the adverse party, or that it is not necessary to protect the rights of the party who caused it to be recorded."[42]
If the registered owner is a party or impleaded as a party in the pending litigation and the notice of lis pendens is ordered annotated, then he/she will be able to have the notice timely cancelled after complying with the Rules. Thus, the cloud on his/her title could be removed at the earliest opportunity. On the other hand, if the registered owner is neither a party nor impleaded as a party, he/she may not even be aware that a notice of lis pendens has already been annotated on the original certificate of title on file with the Registry of Deeds. This is implied from Section 71 of PD 1529, which provides:
SEC. 71. Surrender of certificate in involuntary dealings. – If an attachment or other lien in the nature of involuntary dealing in registered land is registered, and the duplicate certificate is not presented at the time of registration, the Register of Deeds shall, within thirty-six hours thereafter, send notice by mail to the registered owner, stating that such paper has been registered, and requesting him to send or produce his duplicate certificate so that a memorandum of the attachment or other lien may be made thereon. If the owner neglects or refuses to comply within a reasonable time, the Register of Deeds shall report the matter to the court, and it shall, after notice, enter an order to the owner, to produce his certificate at a time and place named therein, and may enforce the order by suitable process.Since a notice of lis pendens is not jurisprudentially considered a lien, it may be annotated without requiring the presentation of the owner's duplicate certificate. Consequently, the registered owner may only become aware of its annotation when he/she goes to the Registry of Deeds to verify the certificate of title or secures a certified true copy of the certificate of title on file with the Registry of Deeds. The registered owner may also become aware of the notice through any other means.
Once the registered owner becomes aware thereof, he/she may seek to intervene in the pending case referred to in the notice and seek its cancellation based on the grounds provided in PD 1529 and the Rules. If the pending case has been terminated, but the notice remains uncancelled, he/she will have to file the appropriate case to have it cancelled.
If the registered owner is not a party or impleaded as a party, he/she is expected to be always on guard for the possibility that a cloud, e.g., notice of lis pendens, may be cast upon his/her certificate of title. Not only will the cancellation of the notice entail expenses, it may take some time before an order of cancellation is obtained from the court. Worse, if the registered owner is in a hurry to dispose of his/her property for some emergency reason, the presence of a notice of lis pendens may be a deal breaker, or the price at which the same may be sold will necessarily be direly affected on account thereof.
The convenience afforded the registered owner is a valid and imperative argument to require that, at the outset, he/she is made a party or impleaded as a party in the pending case.
Thirdly, notifying the registered owner of the pendency of a case directly affecting the titled realty will prevent the commission of fraud upon the registered owner. As a party to the pending case, the registered owner can controvert whatever unfounded adverse claim the other parties may assert against the registered owner.
And, fourthly, as noted by the CA and enunciated by the Court in VerReyes, justice and fair play demand that the registered owner be made a party to the pending case; otherwise, the right of the registered owner to due process would be infringed, viz.:
Indeed, petitioner's belated act of applying for a notice of lis pendens, if allowed by the Office of the Register of Deeds of Cavite, would infringe on the right to due process of Engracia's heirs, who were never parties to the reconveyance suit between petitioner and respondent now pending appeal before the CA. While the notice of lis pendens would not create a right or lien over the property, it will definitely be an inconvenience or a burden, however slight, on the title of Engracia's heirs, especially when dealing with the same property in the concept of owners. Justice and fair play require that Engracia's heirs be rightfully informed of petitioner's claim over the same property by impleading them in the pending suit before the application for annotation of lis pendens be favorably acted upon.[43]The Court clarifies that the registered owner's inconvenience or burden, which is caused by the recording of a notice of lis pendens, might be tempered if at the outset he/she is notified of the application for annotation of the notice by being impleaded as a party to the pending case. And, such inconvenience or burden may not be slight, as noted in Ver-Reyes, because a court order for the cancellation of the notice is required, which in all likelihood will be obtained at the instance of the registered owner. And, as noted earlier the subject property is in limbo while the annotated notice of lis pendens remains.
Given the foregoing reasons, the CA correctly ruled that the registered owners, Pacita Tuason and Pacita T. Principe, should first be impleaded as parties to the pending case.
As mentioned earlier, petitioner Du, citing Ver-Reyes and Voluntad, claims that the Court has allowed the annotation of a notice of lis pendens even if the registered owner is not a party to the pending litigation provided that the party impleaded therein is the successor-in-interest of the registered owner.[44] She argues that such condition is met because Pacita Tuason Principe, the registered owner, was the predecessor-in-interest of Melissa Principe, who is a party to the said pending litigation.[45]
Indeed, the Court noted in Ver-Reyes:
It is for these other reasons that our ruling in Voluntad cannot apply to the present controversy. In Voluntad, the annotation of the notice of lis pendens was allowed on the TCT of Carmen and Maria Voluntad even if they were not parties to the pending litigation because they were the predecessors-in-interest of the Voluntads who applied for the annotation (applicant Voluntads) and that the real property subject thereof was still in the names of Carmen and Maria despite already having passed on to their heirs (applicant Voluntads).Petitioner Du's argument is untenable. The Court fully agrees with the CA that despite her claim that Pacita Tuason and Pacita T. Principe are the same person, no evidence has been presented to prove the same and her assertion that Melissa Principe is the sole heir of Pacita Tuason and Pacita T. Principe remained unsubstantiated.[47] The Court is bound by the findings of the CA inasmuch as only legal questions may be raised in a Rule 45 petition for review. Besides, petitioner Du has not presented before the Court additional proof to substantiate her position.
In contrast, herein petitioner's claim to the prope1iy is not derived from the titles of Engracia and her heirs. While the property described in TCT No. T-784707 in the name of Engracia's heirs refers to the same property described in TCT No. 58459 in the name of Marciano and Virginia Cuevas from whom petitioner claimed to have derived her title, it is apparent that the title of Engracia's heirs over the property is totally alien to the controversy between petitioner and respondent. Had petitioner been truly prudent as she now poses to be, she should have caused the annotation of the Notice of Lis Pendens on TCT No. 58459 in the name of respondent way back when she filed the petition for reconveyance (Civil Case No. 878-94), as this would have resulted in the carrying over of the notice onto TCT Nos. T-769357 (Engracia Isip) and T-784707 (Engracia's heirs) after respondent waived her claim over the property in Isips' favor.[46]
Also, it must be noted that in Voluntad, the Voluntads, who were the successors-in-interest of Carmen and Maria Voluntad (the registered owners), themselves applied for the annotation of a notice of lis pendens. The factual backdrop of Voluntad is as follows:
On 15 February 1993 petitioners [(Delfin Voluntad and the heirs of Luz Voluntad)] filed a petition for mandamus with the Regional Trial Court of Malolos, Bulacan, docketed as Civil Case No. 142-M-93, to direct respondent-spouses Magtanggol Dizon and Corazon Dizon to render a true and correct accounting of the financial obligation of petitioners. It appears that on 12 July 1980 petitioners obtained a loan from the Rural Bank of Pandi secured by a mortgage over one-half of a parcel of land formerly owned by petitioners and covered by TCT No. 25073 (T-7456-M) of the Registry of Deeds of Bulacan. For failure of petitioners to pay the loan, the Rural Bank of Pandi foreclosed the mortgage and the property was sold at public auction with the Bank becoming the highest bidder. More than three (3) months after the certificates of sheriff's sale were registered, the mortgage-vendee Bank, without the knowledge of petitioners, assigned its rights over the property to respondent-spouses Magtanggol and Corazon Dizon. In their petition with the trial court, petitioners prayed to be allowed to exercise their right of redemption over the subject property for the amount of P124,762.04 with legal rate of interest from 17 December 1982 up to its legal redemption.Clearly, requiring the then registered owners of the subject property, Carmen Voluntad (Carmen) and Maria Voluntad (Maria), predecessors-in interest of petitioners in Voluntad, to be impleaded in the petition for mandamus so that a notice of lis pendens could be annotated on Carmen and Maria's certificate of title would be superfluous given that the subject property had passed on to the said petitioners. In fact, the latter were the ones who mortgaged half of the subject property, despite the certificate of title still being in the names of Carmen and Maria, and who wanted to exercise their right of redemption after the mortgage was foreclosed. It is clear in Voluntad that the annotation of a notice of lis pendens was sought by the very successors-in-interest of the registered owners to protect their right of redemption in the subject property and prevent the entry of a subsequent transferee, who might claim a superior right over them by interposing that he/she was an innocent purchaser for value and unaware of the controversy or litigation between the said successors-in-interest and the transferee of the mortgagor bank, the spouses Dizon.
On 16 February 1993 petitioners caused the annotation of a notice of lis pendens on the subject property then under the name of Carmen Voluntad and Maria Voluntad, predecessors-in-interest of petitioners. Upon partition into two (2) of the prope1iy covered by TCT No. 25073 (T-7456-M) the notice of lis pendens was carried over to TCT No. T-166332-M in the name of respondent-spouses Dizon. The Dizons then filed an omnibus motion to dismiss the petition and to strike out the notice of lis pendens.[48]
The facts obtaining in Voluntad are incomparable to the facts of the instant case. Thus, Voluntad and the portion in Ver-Reyes reiterating Voluntad find no application in the present case.
As a final note, had petitioner Du not been obstinate and capitulated by complying with the requirement that the registered owners be impleaded, the case would not have dragged for six years and reached this Court, wasting in the process not only her time and resources but those of the adverse party and the courts. To stress anew, such requirement is not difficult to comply with.
WHEREFORE, the Petition is hereby DENIED. Accordingly, the Decision dated September 11, 2020 and Resolution dated February 10, 2021 of the Court of Appeals in CA-G.R. SP No. 156777 are AFFIRMED.
SO ORDERED.
Inting, Gaerlan, Dimaampao, and Singh, JJ., concur.
[.] Also "Ortille" in some parts of the rollo.
[1] Rollo, pp. 11-33, excluding Annexes.
[2] Id. at 38-44. Penned by Associate Justice Germano Francisco D. Legaspi, with Associate Justices Franchito N. Diamante and Walter S. Ong concurring.
[3] Id. at 45-46.
[4] Twelfth (12th) Division and Former Twelfth (12th) Division.
[5] Id. at 38-40.
[6] Supra note 2.
[7] Id. at 41.
[8] Id.
[9] Id.
[10] Id. at 43.
[11] Id.
[12] Supra note 3.
[13] Id. at 186-187.
[14] Id. at 189-201.
[15] Id. at 18.
[16] AMENDING AND CODIFYING THE LAWS RELATIVE TO REGISTRATION OF PROPERTY AND FOR OTHER PURPOSES," otherwise known as the "PROPERTY REGISTRATION DECREE," approved on June 11, 1978.
[17] Rollo, p. 23.
[18] Id.
[19] 372 Phil. 82 (1999).
[20] Rollo, p. 23.
[21] Id. at 42. Citation omitted.
[22] Id. Citation omitted.
[23] Id. at 42-43. Citation omitted.
[24] Id. at 43.
[25] Id., citing Ver-Reyes v. Court of Appeals, et al., 585 Phil. 503 (2008).
[26] Id., citing Ver-Reyes v. Court of Appeals, et al., id.
[27] Id. at 25.
[28] Id.
[29] Id. at 25-26.
[30] Supra note 24. It is noted that Ver-Reyes cited Voluntad.
[31] Rollo, pp. 27-28.
[32] Id. at 28.
[33] Id. at 43.
[34] 346 Phil. 289 (1997).
[35] Id. at 299. Citation omitted.
[36] Id. at 299-300. Citation omitted.
[37] Spouses Lim v. Vera Cruz, 408 Phil. 503, 505 and 508-509 (2001). Citations omitted.
[38] Magdalena Homeowners Association, Inc. v. Court of Appeals, 263 Phil. 235, 241 (1990). Citations omitted.
[39] Viewmaster Construction Corp. v. Maulit, 383 Phil. 729, 741-742 (2000). Citations omitted.
[40] Villanueva v. Court of Appeals, supra note 33, at 299. Citation omitted.
[41] PD 1529, Sec. 76. Emphasis and underscoring supplied.
[42] Emphasis and underscoring supplied.
[43] Ver-Reyes v. Court of Appeals, et al., supra note 24, at 512.
[44] See rollo, pp. 27-28.
[45] Id. at 28.
[46] Ver-Reyes v. Court of Appeals, et al., supra note 24, at 511-512.
[47] Rollo, p. 43.
[48] Voluntad v. Sps. Dizon, supra note 18, at 86-87.