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Hertaxesonthesaidpropertywerepaid,butonlyuntil1977.Therealpropertytaxes
fromtheyear1978to1983amountingtoP3,034.99,inclusiveofpenalties,werenotpaid.
ForfailureofBanteguitopaysaidtaxes,thecitytreasurerofQCsoldsaidpropertyat
publicauctionheldonNov21,1984,tothespousesCapistrano,forthesumofP10000.
TheCertificateofSaleofDelinquentPropertywassubsequentlyissuedintheirfavoronNov26,1984.
Sincethepropertywasnotredeemedw/inthe1yrredemptionperiod,titletosaid
propertywasconsolidatedtotheCapistranos&TCTNo.361851wasissuedintheir
namesonJune4,1987.TheCapistranos,however,didnottakepossessionoftheland.
Theyalsodidnotpayrealpropertytaxesthereon.
Thepropertywaslatersoldin1988bytheCapistranostospousesPereyraforP60,000.
TheirTCTwascancelled&anewTCTNo.2059wasissuedin1989inthenameofthe
Pereyras,whoalsodidnottakepossessionofthepropertyinquestion.Buttheymortgagedthe
sametotheRuralBankofImus,Cavite,whichwasannotatedonthetitleoftheproperty.
ThesetransferswereunknowntoBanteguiandtheCaedos,despitethefactthatEvelyn
PereyraisthedaughteroftheCaedos.Allthistime,theactualoccupants,theCaedos,
consideredthemselvesastenantsofBantegui.
Banteguiappliedforadministrativereconstitutionofhertitle,asitwaslostinafire.
ReconstitutedTitlewassubsequentlyissuedinhername.Shepaidtherealtytaxesonthe
subjectpropertyfortheyears19871989.ThecitytreasurerofQCrefusedtoaccepther
paymentfortheyear1990.
OnMay3,1990,saidpropertywasagainsoldbythePereyrastothespousesRamon&
RositaTanforP350,000,withthelatterpayingtheamountofP300,000totheRural
BankofImus,Caviteforthereleaseofthemortgageperagreementbytheparties.They
paidtheoverduetaxes&otherexpensesincurredbythePereyraspertainingtosaid
mortgage.
TheTansalsodidnottakeimmediatepossessionofthepropertyorinformCaedosof
theirtitletotheland.Towardsthelatterpartof1990,theTansinformedtheCaedosof
theirownershipovertheproperty&demandedthattheCaedosvacatetheproperty.They
subsequentlyfiledanactionforejectmentagainsttheCaedosbeforetheMTCofQCon
Jan18,1991.OnOct31,1991,theCourtruledinfavoroftheTans.TheCaedosthen
interposedanappealonFeb2,1992,w/cwasremandedtothesameCourtforfurther
proceedings,&forfailureoftheCaedostoappearduringthehearingofthecase,they
weredeclaredindefault&weresubsequentlyejectedfromthepropertyonFeb20,1994,
whenthehousethattheyerectedthereonwasdemolished.
OnFeb11,1992,Bantegui,thruhersisterGuadalupeBautista,&joinedbythespouses
Caedo,filedaComplaintforAnnulmentofSale,Injunction&Damagesw/theRTCofQC.
The trial courts Decision is in favor of respondents, petitioners appealed to the CA.
RulingoftheCourtofAppeals
Indeclaringthatpetitionerswerenotpurchasersingoodfaith&hadnobetterrighttothe
subjectproperty,theappellatecourtgavetheffreasons.First,theauctionsalewastainted
withirregularities:nonoticesofdelinquencyandofsaleweresenttotheowner.
2nd,theownercontinuedtopayrealtytaxesontheproperty,evenafterthedateofthesale.She
wouldnothavedonesohadshebeenawarethatithadalreadybeenauctionedoff.
3rd,thesellingpricewasgrosslyinadequate&wouldrenderthesaleitselfvoid.
Fourth,thepurchasersfailedtotakepossessionoftheproperty,paytherealtaxes,&informthe
lesseesofthepurchase.Asaresult,thelattercontinuedtopayrenttotheowner.
Asstatedearlier,theCAaffirmedthetrialcourtsDecision.
Hence,thisPetition.
TheIssue:Whethertheauctionsalewasvalid.
TheCourtsRuling
ThetaxsaledidnotconformtotherequirementsprescribedunderPDNo.464(Real
PropertyTaxCode).
1st,nonoticeofdelinquencyorofsalewasgiventoeitherBantegui/toherrepresentative.
SEC65.Noticeofdelinquencyinthepaymentoftherealpropertytax.
SEC73.Advertisementofsaleofrealpropertyatpublicauction.
Theauctionsaleofrealpropertyforthecollectionofdelinquenttaxesisinpersonam,not
inrem.Althoughsufficientinproceedingsinremlikelandregistration,merenoticeby
publicationwillnotsatisfytherequirementsofproceedingsinpersonam.Publicationof
thenoticeofdelinquencywillnotsuffice,consideringthattheprocedureintaxsalesisin
personam.Itisstillincumbentuponthecitytreasurertosendthenoticedirectlytothe
taxpayertheregisteredownerofthepropertyinordertoprotectthelattersinterests.
Althoughprecededbyproperadvertisement&publication,anauctionsaleisvoidabsent
anactualnoticetoadelinquenttaxpayer.
Thesaleoflandfortaxdelinquencyisinderogationofpropertyrights&dueprocess.
Inthepresentcase,noticeseitherofdelinquency/ofsalewerenotgiventothedelinquent
taxpayer.Thosenoticesaremandatory,&failuretoissuetheminvalidatesasale.
While it is true that TCT have already been issued in the names of the subsequent
purchasers,theyshouldnonethelessbeinvalidated.Consideringthefailuretoabideby
themandatoryrequirementsofaproceedinginpersonam,nobettertitlethanthatofthe
originalownercanbeassumedbythetransferees.
Besides,theincontrovertiblenatureofacertificateoftitleappliesonlywhentheissue
involvedisthevalidityoftheoriginal¬ofthetransfer.Subsequenttitlesissuedto
the prejudice of the rightful owner will produce no legal effects whatsoever. Quod
nullumest,nullumproduciteffectum.Thatwhichisanullityproducesnoeffect.
Moreover,failuretoassertownershipoverapropertyisindicativeofthedoubtfulvalidity
ofitssale.
Theimmediatepurchasersinthepresentcaseneithertookpossessionnorinformedthe
occupants(theCaedos)oftheformersallegedacquisitionoftheproperty.Thepurchasers
did not even demand rent or ask them to vacate, as a result of which the Caedos
continuedtopayrenttoBantegui.Indeed,registeredownershavetherighttoenjoythe
propertythattheyown,includingthejusutendiortherighttoreceivefromitwhateverit
produces.
2nd,onlyacopyoftheResolutionofRTCofQC,Br85,confirmingthefinalbillofsale
totheCapistranos,hasbeensubmittedbythecitytreasurertoshowthevalidityofthe
sale.
Third,Sec80ofPD464providesthatanybalanceoftheproceedsofthesaleleftafter
deductingtheamountofthetaxes&penaltiesdue&thecostsofsale,shallbereturnedto
theowner/hisrepresentative.Againcontrarytothemandateofthelaw,thebalanceofthe
proceedsfromthetaxsalewasnotevenreturnedtoBantegui/herrepresentativeafterthe
issuanceofthefinalbillofsale.Thefailuretoreturntheproceedsreinforcedtheapparent
irregularitynotonlyintheconductofthetaxsale,butalsoinitssubsequentdisposition.
Fourth,petitionerswerenotinnocentpurchasersforvalue.Despitetheirawarenessof
defectsintheirtitle,theystillfailedtoinvestigateortakethenecessaryprecaution.
A purchaser of real estate at the tax sale obtains only such title as that held bythe
taxpayer;theprincipleof caveatemptor applies.Purchaserscannotclosetheireyesto
factsthatshouldhaveputanyreasonablepersonuponguard,&thenclaimthattheyacted
ingoodfaithunderthebeliefthattherewasnodefectinthetitle.Ifpetitionersdonot
investigate/takeprecautiondespiteknowingcertainfacts,theycannotbeconsideredin
goodfaith
In the present case, the exercise of the right of possession over the property was
attemptedbynoneofthepurchasers,exceptpetitioners.Informationaboutthepurchase
wasnotatallrelayedbyPereyratotheCaedoswhowereherveryownparents.Whenthe
landsoldisinthepossessionofapersonotherthanthevendor,thepurchaserisrequired
togobeyondthecertificateoftitleandmakeinquiriesconcerningtherightsoftheactual
possessor.
Furthermore,asidefromBantegui,thepurchaserspaidrealpropertytaxes,asrequiredof
everyregisteredpropertyowner.Thetaxonrealpropertyforanyyearshallattachto,
becomedueandpayablefrom,&bethepersonalliabilityofitsowneratthebeginningof
theyear.ThecitygovernmentallowedBanteguitocontinuepayingrealpropertytaxes
evenaftertheredemptionperiod&theconfirmationofthefinalbillofsale.Moreover,
therecordsmentionnopaymentofrealpropertytaxesfrom1984to1986.
Finally,Banteguiremainedincontinuouspossessionoftheownersduplicatecopyofthe
CertificateofTitle.Shewasevenallowedtoundertakeanadministrativereconstitutionof
herfilecopyafteritsdestructionbyfire.Accordingly,theRegisterofDeedsissueda
reconstitutedtitleinhername,inwhichthepropertyhadbeenregisteredasearlyas1959.
Forreasonsknownonlytotheallegedpurchasers,noattemptwasevenmadetohavethe
titleimmediatelycancelled.Itisbasicthatregistrationdoesnotvesttitle,whichisamere
evidenceoftitletoaproperty.
Moreimportant,thereconstitutedtitlewasalloweddespitethefactthatseveralTCTshad
alreadybeenpreviouslyissuedinfavorofpetitionerspredecessorsininterest.Although
.Costsagainstpetitioners.