UYvsCA

FACTS:

TheCatadorspousesofferedtoselltoprivaterespondentRosaSaulerthewholeparceloflandforP80.00per
squarmeter.TheoriginalagreemententeredintobyprivaterespondentandtheCatadorspousescoveredthewhole
property.Initially,anamountofP45,000.00waspaidto,andreceiptedforby,thespouseswhothenundertookto
executetheformaldeedofconveyanceuponfullpaymentofthepurchaseprice.Privaterespondentthereupontook
possessionofaportionoftheproperty.

On18October1978,theCatadorspousesmortgagedthepropertytotheStateInvestmentHouse,Inc.("SIHI"),to
"accommodate"theirniece,AngelinaCadievaLacson,whohadsecuredaloanofP250,000.00fromSIHI.The
mortgagewasregisteredwiththeRegistryofDeedsinBulacanandannotatedonthetransfercertificateoftitleof
theproperty.Uponlearningofthemortgage,privaterespondentgaveupherinteresttoacquirethewholeproperty
andsettledfortheconfirmatorypurchaseofthe555squaremeterportionwhichshewasthenactuallyoccupying.
AngelinaCadievaLacson,thenieceoftheCatadorspouses,defaultedonherloan;whereupon,SIHIforeclosedon
thesecurity.Attheextrajudicial foreclosuresale,SIHIcameouttobethehighestbidderatP309,515.15.The
certificateofsaleissuedbytheProvincialSheriffofBulacanwasregisteredintheRegistryofDeedsandannotated
atthebackofthecertificateoftitleon17March1980.

Oneyearthereafter,oron17March1981(theexpirydateoftheoneyearredemptionperiodunderActNo.3135),
SIHIreceivedaletterfromprivaterespondentassertingherownershipoverthe555squaremetersoftheforeclosed
land.Theletterwasfollowed,on13August1981,byanothercommunicationsentthistimebyprivaterespondent's
son,WilliamAng,whoofferedtobuyfromSIHIonehalfofthepropertyforP225,000.00.SIHIdidnotrespondto
bothletters.Inthemeantime,oron21April1981,SIHIconsolidatedownershipovertheproperty.On19October
1981,TCTNo.(170692)9968wascanceledandreplacedbyTCTNo.48467inSIHl'sname.

Twoyearslater,petitionerMichaelT.UyboughtthepropertyfromSIHI.Allegingtitleovertheportionofthe
propertysoldtoher,privaterespondentfiledwiththeRegionalTrialCourtacomplaintforlegalredemptionwith
damagesagainstMichaelT.UyandSIHI.Thecomplaintstatedthatprivaterespondent,beingapartownerofthe
lot,wasentitledtoarightofredemptionwhenSIHIsolditspartofthepropertytopetitionerMichaelUy,evidently
invokingArticle1620,inrelationtoArticle1623,oftheCivilCode

Petitionersdefensepetitioneraverred,amongotherthings,thathewasunawareofanycontractbetweenprivate
respondentandtheCatadorspousesandthat,ifthereindeedwassuchatransaction,hecouldnotbeboundbyitfor
notbeingregisteredintheRegistryofDeeds.Inanyevent,petitioneradded,privaterespondentfailedtoexercise
her right of redemption within the reglementary 30day period from the time she acquired knowledge of the
foreclosuresale.

SIHIsanswerthatprivaterespondentcouldnotprofessignoranceoftheextrajudicialforeclosuresalebecause
itwaspublishedinanewspaperofgeneralcirculationforthreeconsecutiveweeks,andthatsheshouldtherebybe
barredbyestoppelfromclaiminganyrightofredemption.

RTCrendereddecisioninfavoroftherespondentandagainstthepetitioner
CAaffirmed.

ISSUE:whetherornottherespondentisentitledtolegalredemptionfortheentireproperty.

RULING:NO

Thefactsthatwouldindicateprivaterespondent'srightfultitletoaspecificportionoftheforeclosedasset,i.e.,her
beinginpossessionofthe555squaremeterarea,herrepairingandimprovingthehousestandingthereon,her
enclosingthepremiseswithconcretefenceandasteelgate, 14installingdrainage(pipes),aswellasfillingupthe
sitewithearth("tambak")andherconstructingabodegafortherawmaterialsandsupplies 15 ofher"Kastiron
Foundry&MachineShop"business, 16verily,arethecircumstancesthatnegate,ratherthanbolster,herclaim
forlegalredemptionovertheentirepropertyonthebasisofArticle1620, inrelationtoArticle1623,ofthe
CivilCode.Theexerciseofarightoflegalredemptionthereunderpresupposestheexistenceofacoownershipat
thetimetheconveyanceismadebyacoownerandwhenitisdemandedbytheothercoownerorcoowners.There
iscoownershipwhen"theownershipofanundividedthingorrightbelongstodifferentpersons."

Atnotimeinthecaseatbenchhascoownershipovertheentireloteverexistedbetweenprivaterespondentand
SIHIor,later,itssuccessorMichaelUy.NotbeingacoownerofLotNo.1551C1J,privaterespondent'spleato
haveherrightofredemptionupheldbyuscannotbesustained.

Forhispart,petitionermaynotsuccessfullypretendtobeaninnocentpurchaserforvalueofthedisputedlot
soastowarranthissoleownershipovertheentirepropertyandtherebyprecludeprivaterespondentfrom
assertingherpriorpurchaseofthe555squaremeterportionthereof.TheCourtofAppeals,thefactualfindings
ofwhichwecannotignore,said:

WearenotconvincedthatappellantMichaelUycanbeconsideredinnocentpurchaserforvalue.Tobe
sure, appellant Uy was fully aware of appellee's possession of the portion of lot in question (Tsn.,
December13,1988,p.9).Whynot,whensubjectpropertyisadjacenttothelandoccupiedbyappellantUy
andhisparents?Notonlythat;astestifiedtobyWilliamAngTee,sonofappellee,heandNumeriano
CatadormetwithappellantUyandthelatter'sfather,Dionisio,andinthatmeeting,NumerianoCatador
informedDionisioUythattheappelleeboughta555squaremeterportionofLot1551C1J(Tsn.,June
25,1987,p.6);atestimonialevidenceappearingtobeunrebutted.Therefore,appellantUYcannotbe
categorizedapurchaseringoodfaithbecausehehadknowledgeofthepriorsaletoappelleeofthe555
squaremetersundercontroversy.

NeithercanSIHI,petitioner'spredecessorininterest,claimtobeaninnocentmortgagee.InSunshineFinanceand
InvestmentCorporationv.IAC,theCourt,afterrecitingthegeneralrulethatamortgagee"isundernoobligationto
lookbeyondthecertificateandinvestigatethetitleofthemortgagorappearingonthefaceofthecertificate,"has
thenceforthelaborated:
Nevertheless,wehavetodeviatefromthegeneralrulebecauseofthefailureofthepetitionerinthiscaseto
takethenecessaryprecautionstoascertainiftherewasanyflawinthetitleoftheNolascosandtoexamine
theconditionofthepropertytheysoughttomortgage. Thepetitionerisaninvestmentandfinancing
corporation.Wepresumeitisexperiencedinitsbusiness.Ascertainmentofthestatusandcondition
ofpropertiesofferedtoitassecurityfortheloansitextendsmustbeastandardandindispensable
partofitsoperations.Surely,itcannotsimplyrelyonanexaminationofaTorrenscertificateto
determinewhatthesubjectpropertylookslikeasitsconditionisnotapparentinthedocument.The
landmightbeinadepressedarea.Theremightbesquattersonit.Itmightbeeasilyinundated.It
mightbeaninteriorlot,withoutconvenientaccess.Theseandothersimilarfactorsdeterminethe
valueofthepropertyandsoshouldbeofpracticalconcerntothepetitioner.
Curiously,thepetitionermerelyreliedonthecertificateoftitletopersuadeitthatthesecurityofferedwas
acceptable.Itwouldhavebeensosimpleforittosendoneofitstrainedinvestigatorstomakeanocular
inspectionofthelandwhich,afterall,wasnotinsomeremoteorforbiddingwilderness."

WHEREFORE,thedecisionappealedfrom,aswellasthatofthetrialcourtinCivilCaseNo.2263V85,isSET
ASIDE.Instead,anewoneisRENDERED(a)upholdingtherightofpetitioneroverthelotcoveredbyTransfer
CertificateofTitleNo.108486excluding,however,the555squaremeterareaboughtbyprivaterespondentwhich
ownershipissimilarlyherebyDECLAREDtobethatofthelatterand(b)denyingthedemandforlegalredemption
byprivaterespondent.Nospecialpronouncementoncosts.