Traders Royal Bank vs.

Court of Appeals
G.R. No. 114299 September 24, 1999
Capay et. Al vs. Santos et. Al
G.R. No. 118862 September 24, 1999

FACTS:
Traders royal bank extended a loan in favor of spouses Capay which includes a mortgage
to several properties one of which is a parcel of land. the loan became due thus TRB instituted
foreclosure proceedings, the Capays however filed a petition for prohibition with preliminary
injunction claiming that the mortgage was void since they did not receive the loan, which was
granted, additionally the Capays caused to be filed a notice of lis pendens which was entered in
the Day book.
The injunction was lifted thus allowing the foreclosure sale of the property, where TRB
won, however in the certificate of title the notice of lis pendens was not carried over. The
Capays then filed with the CFI a complaint praying for recovery of property, wherein the CFI
declared the mortgage void thus ordered the cancellation of the TCT of TRB. TRB then appealed
to the Court of Appeals and while the case is pending they sold the property to Ms. Santiago,
and she resold the lot to 3 other persons, also without any notice of lis pendens annotated.
The Court of Appeals affirmed the ruling of the lower court, hence the lower courts
issued a writ of execution against TRB and the non-bank respondents. TRB together with the
new owners filed for appeal but was again denied stating that they were not buyers in good
faith, and that while the notice for lis pendens was not carried over the entry in the Day book is
sufficient and that TRB was a seller in bad faith knowing that such property is under litigation.
ISSUE:
a) Whether the non-bank respondents had a better right to the disputed property
b) Whether the Capays should recover the property
HELD:
a) Yes, there was nothing in the certificates of title or respective predecessors-in-interest
that could have aroused their suspicion. The non-bank respondents had a right to rely
on what appeared on the face of the title of their respective predecessors-in-interest,
and were not bound to go beyond the same. To hold otherwise would defeat one of the
principal objects of the Torrens system of land registration which is to avoid possible
conflicts of title to real estate and to facilitate transactions relative thereto by giving the
public the right to rely upon the face of a Torrens certificate of title and to dispense with
the need of inquiring further. Every person dealing with registered land may safely rely
on the correctness of the certificate of title issued therefor and the law will in no way
oblige him to go beyond the certificate to determine the condition of the property.
b) Yes, however this remedy is not now available to the Capays inasmuch as title to said
property has passed into the hands of third parties who acquired the same in good faith
and for value. TRB is duty bound to pay the Capays the fair market value of the property
at the time it was sold to Emelita Santiago, the transferee of TRB.

Director of Lands vs. Reyes
G.R. No. L-27594 November 28, 1975
Alinsunurin vs. Director of Lands
G.R. No. L-28144 November 28, 1975

FACTS:
Alinsunurin filed an application for registration of title for a vast track of land with the
CFI of Nueva Ecija, to which he claims that he inherited such from a certain Maria Padilla,
however he filed for a motion for substitution of parties in that Paranaque Investment and
Development Corporation be considered the applicant having acquired his rights. The Director
of Lands, Director of Forestry and AFP however opposed such application for registration since
Fort Magsaysay was situated in such land and that the applicant was not in open, continuous,
exclusive and notorious possession and occupation of the land for at least thirty years.
The lower court granted the application for registration. Subsequently, The oppositors
filed for an approval of an amended record on appeal, and during such time Paranaque
Investment filed for a motion for the issuance of a decree of registration pending appeal. The
lower court, through the respondent judge, granted the issuance of the decree, and ordered
the Registry of deeds to issue an OCT. Thereafter, the lower court approved the amended
record on appeal in due course. However, the lower court denied reconsideration of the
issuance of the registration, prompting the appellants to institute a special civil action for
certiorari and mandamus with preliminary injunction to nullify such order, which was issued.
ISSUE:
a) Whether execution pending appeal is applicable to Land registration
b) Whether an issuance of a Torrens title based on judgment that is not final, and despite
timely appeal is void and erroneous.
HELD:
a) No, Execution pending appeal is not applicable in land registration proceedings. It is
fraught with dangerous consequences. Innocent purchasers may be misled into
purchasing real properties upon reliance on a judgment which may be reversed on
appeal.
b) Yes, a Torrens Title issued on the basis of a judgment that is not final, the judgment
being on appeal, is a nullity, as it is violative of the explicit provisions of the Land
Registration Act, which requires that a decree shall be issued only after the decision
adjudicating the title becomes final and executory, and it is on the basis of said decree
that the register of deeds concerned issues the corresponding certificate of title.