CAGUIOA, J:
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]
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.
- 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]
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)
"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]
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.
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.
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.
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]
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]