Submitted by: Ma. Nikka Floan M.
Ramirez
Case Title: Consolidated Rural Bank (Cagayan Valley), Inc. vs CA
Relevant Facts: The Madrid brothers were the registered owners of Lot No. 7036-A as per
Transfer Certificate of Title (TCT) No. T-8121. Rizal Madrid sold part of his
share (Lot No. 7036-A-7) to Aleja Gamiao and Felisa Dayag in 1957.
Portions of Lot No. 7036-A-7 were further sold to Teodoro dela Cruz,
Restituto Hernandez, and eventually to Pacifico Marquez. Marquez
subdivided Lot No. 7036-A-7 into smaller lots and mortgaged some of them
to CRB and RBC to secure loans. Due to default in payment, CRB
foreclosed the mortgages and acquired the lots through foreclosure sale.
The heirs of Teodoro dela Cruz filed a case for reconveyance and damages
against Marquez, Calixto, RBC, and CRB, contesting the validity of the
transactions.
Argument of the The petitioner asserts that they are the rightful owners of the southern half
Petitioner portion of Lot No. 7036-A-7 based on their predecessor's acquisition and
continuous possession of the property.
Argument of the Marquez argued that he purchased the property in good faith, relying on the
Respondent validity of the title presented to him at the time of the sale. Further, asserts
that he had no knowledge of any competing claims to the property and
therefore should not be penalized for actions taken in good faith.
Ruling of the trial The trial court dismissed the amended complaint and the complaint in
court (if any) intervention filed by the heirs of Teodoro dela Cruz, represented by Edronel
dela Cruz. It declared Pacifico V. Marquez as the lawful owner of Lots 7036-
A-7, which were later subdivided into Lots 7036-A-7-A to 7036-A-7-H,
inclusive, covered by TCT Nos. T-149375 to T-149382.
Ruling of the The CA reversed the RTC’s decision, which favored Pacifico V. Marquez
appellate court (if and upheld the validity of the mortgages. CA declared the heirs of Teodoro
any) dela Cruz as the lawful owners of the southern half portion of Lot No. 7036-
A-7, covered by TCT Nos. T-149375 to T-14938. The CA also declared null
and void the mortgages made by Pacifico V. Marquez in favor of
Consolidated Rural Bank (Cagayan Valley) and Rural Bank of Cauayan
regarding Lot Nos. 7036-A-7-A, 7036-A-7-B, 7036-A-7-C, and 7036-A-7-D.
Ruling of the Supreme Court denied the petition, affirming the decision of the Court of
Supreme Court Appeals. Further, ruled that the Heirs of Teodoro dela Cruz is the lawful
owners of the subject property, declaring the deed of sale between Pacifico
V. Marquez and the Madrid brothers null and void. Hence, the provision of
Art 1544 is not applicable in this case because this provision covers a
situation where a single vendor sold one and the same immovable property
to two or more buyers. The law provides that, it is necessary that the
conveyance must have been made by a party who has an existing right in
the thing and the power to dispose of it. It cannot be invoked where the two
different contracts of sale are made by two different persons, one of them
not being the owner of the property sold. Thus, even if the sale was made
by the same person, if the second sale was made when such person was
no longer the owner of the property, because it had been acquired by the
first purchaser in full dominion, the second purchaser cannot acquire any
right.
RELEVANCE TO ART. 1544. If the same thing should have been sold to different vendees,
THE TOPIC ON the ownership shall be transferred to the person who may have first taken
LAW ON SALE possession thereof in good faith, if it should be movable property. subject
property was not transferred to several purchasers by a single vendor. In
the first deed of sale, the vendors were Gamiao and Dayag whose right to
the subject property originated from their acquisition thereof from Rizal
Madrid with the conformity of all the other Madrid brothers in 1957, followed
by their declaration of the property in its entirety for taxation purposes in
their names. On the other hand, the vendors in the other or later deed were
the Madrid brothers but at that time they were no longer the owners since
they had long before disposed of the property in favor of Gamiao and
Dayag.
