Frenzel vs Catito

Section 14, Article XIV of the 1973 Constitution provides, as follows:

“Save in cases of hereditary succession, no private land shall be transferred or conveyed except
to individuals, corporations, or associations qualified to acquire or hold lands in the public
domain”

Aliens, whether individuals or corporations, have been disqualified from acquiring lands of the
public domain. Hence, they have also been disqualified from acquiring private lands.

Even if, as claimed by the petitioner, the sales in question were entered into by him as the real
vendee, the said transactions are in violation of the Constitution; hence, are null and void ab
initio. A contract that violates the Constitution and the law, is null and void and vests no rights
and creates no obligations. The petitioner, being a party to an illegal contract, cannot come into
a court of law and ask to have his illegal objective carried out.

The petitioner cannot feign ignorance of the constitutional proscription, nor claim that he acted
in good faith, let alone assert that he is less guilty than the respondent. The petitioner is
charged with knowledge of the constitutional prohibition. As can be gleaned from the decision
of the trial court, the petitioner was fully aware that he was disqualified from acquiring and
owning lands under Philippine law even before he purchased the properties in question; and, to
skirt the constitutional prohibition, the petitioner had the deed of sale placed under the
respondents name as the sole vendee thereof.

Alcantara-Daus vs De leon

A contract of sale is consensual. It is perfected by mere consent, upon a meeting of the

mind on the offer and the acceptance thereof based on subject matter, price and terms of
payment. At this stage, the sellers ownership of the thing sold is not an element in the
perfection of the contract of sale.
It is during the delivery that the law requires the seller to have the right to transfer
ownership of the thing sold. In general, a perfected contract of sale cannot be challenged on
the ground of the sellers non-ownership of the thing
Petitioner claims that her possession of the land is in good faith and that, consequently,
she has acquired ownership thereof by virtue of prescription. We are not persuaded.
It is well-settled that no title to registered land in derogation of that of the registered
owner shall be acquired by prescription or adverse possession. Consequently, since a certificate
of registration covers it, the disputed land cannot be acquired by prescription regardless of
petitioners good faith.
 Article 1141 of the New Civil Code provides that real actions over immovable properties
prescribe after thirty years. This period for filing an action is interrupted when a complaint is
filed in court.
On the claim of laches, it has no merit. Laches is based upon equity and the public policy.
Since laches is an equitable doctrine, its application is controlled by equitable considerations. It
cannot be used to defeat justice or to perpetuate fraud and injustice.Thus, the assertion of
laches to thwart the claim of respondents is foreclosed, because the Deed upon which
petitioner bases her claim is a forgery.
Nool vs CA
- contract of repurchase arising out of a contract of sale where the seller (Petitioners
Conchita Nool) did not have any title to the property sold is not valid. Since nothing was
sold, then there is also nothing to repurchase. Her, it is clear that the sellers no longer
had any title to the parcels of land at the time of sale. Since Exhibit D, the alleged
contract of repurchase, was dependent on the validity of Exhibit C(Contract of Sale), it is
itself void. A void contract cannot give rise to a valid one.
- The right to repurchase presupposes a valid contract of sale between
the same parties. Undisputedly, private respondents acquired title to the property from
DBP, and not from the petitioners.
- The private respondents cannot be estopped from raising the defense of nullity of
contract, specially in this case where they acted in good faith, believing that indeed
petitioners could sell the two parcels of land in question. Article 1410 of the Civil Code
mandates that the action or defense for the declaration of the inexistence of a contract
does not prescribe. It is well-settled doctrine that as between parties to a contract,
validity cannot be given to it by estoppel if it is prohibited by law or it is against public
policy

Mapalo vs Mapalo

- Under the Civil Code, either the old or the new, for a contract to exist at all, three
essential requisites must concur: (1) consent, (2) object, and (3) cause or consideration.
- The rule under the Civil Code, again be it the old or the new, is that contracts without a
cause or consideration produce no effect whatsoever. Nonetheless, under the Old Civil
Code, the statement of a false consideration renders the contract voidable, unless it is
proven that it is supported by another real and licit consideration. And it is further
provided by the Old Civil Code that the action for annulment of a contract on the ground
of falsity of consideration shall last four years, the term to run from the date of the
consummation of the contract. Accordingly, since the deed of sale of 1936 is governed
 by the Old Civil Code, it should be asked whether its case is one wherein there is no
consideration, or one with a statement of a false consideration. If the former, it is void
and inexistent; if the latter, only voidable, under the Old Civil Code. As observed earlier,
the deed of sale of 1936 stated that it had for its consideration Five Hundred (P500.00)
Pesos. In fact, however, said consideration was totally absent.

- A contract of purchase and sale is null and void and produces no effect whatsoever
where the same is without cause or consideration in that the purchase price which
appears thereon as paid has in fact never been paid by the purchaser to the vendor.
Under the existing classification, such contract would be "inexisting" and "the action or
defense for declaration" of such inexistence "does not prescribe". (Art. 1410, New Civil
Code).

Heirs of Intac vs CA

-For a contract to be valid, it must have three essential elements: (1) consent of the
contracting parties; (2) object certain which is the subject matter of the contract; and (3) cause
of the obligation which is established.12

All these elements must be present to constitute a valid contract. Consent is essential to the
existence of a contract; and where it is wanting, the contract is non-existent. In a contract of
sale, its perfection is consummated at the moment there is a meeting of the minds upon the
thing that is the object of the contract and upon the price. Consent is manifested by the
meeting of the offer and the acceptance of the thing and the cause, which are to constitute the
contract.

Art. 1345. Simulation of a contract may be absolute or relative. The former takes place when
the parties do not intend to be bound at all; the latter, when the parties conceal their true
agreement.

Art. 1346. An absolutely simulated or fictitious contract is void. A relative simulation, when it
does not prejudice a third person and is not intended for any purpose contrary to law, morals,
good customs, public order or public policy binds the parties to their real agreement.

if the parties state a false cause in the contract to conceal their real agreement, the contract is
only relatively simulated and the parties are still bound by their real agreement. Hence, where
the essential requisites of a contract are present and the simulation refers only to the content
or terms of the contract, the agreement is absolutely binding and enforceable between the
parties and their successors in interest.

In absolute simulation, there is a colorable contract but it has no substance as the parties have
no intention to be bound by it. "The main characteristic of an absolute simulation is that the
apparent contract is not really desired or intended to produce legal effect or in any way alter
the juridical situation of the parties."14 "As a result, an absolutely simulated or fictitious
contract is void, and the parties may recover from each other what they may have given under
the contract."15

There can be no doubt that the contract of sale or Kasulatan lacked the essential element of
consideration. It is a well-entrenched rule that where the deed of sale states that the purchase
price has been paid but in fact has never been paid, the deed of sale is null and void ab initio for
lack of consideration. Moreover, Art. 1471 of the Civil Code, which provides that "if the price is
simulated, the sale is void," also applies to the instant case, since the price purportedly paid as
indicated in the contract of sale was simulated for no payment was actually made.

Bagnas vs CA

There is no Contract of Sale for lack of consideration. – the disproportion of the sales price of 1
peso and the actual value of 10,500 tantamounts to lack of consideration.

One issue clearly predominates here. It is whether, in view of the fact that, for properties
assuredly worth in actual value many times over their total assessed valuation of more than
P10,000.00, the questioned deeds of sale each state a price of only one peso (P1.00) plus
unspecified past, present and future services to which no value is assigned, said deeds were
void or inexistent from the beginning ("nulo") or merely voidable, that is, valid until annulled. If
they were only voidable, then it is a correct proposition that since the vendor Mateum had no
forced heirs whose legitimes may have been impaired, and the petitioners, his collateral
relatives, not being bound either principally or subsidiarily to the terms of said deeds, the latter
had and have no actionable right to question those transfers. On the other hand if the sale is
void, upon mateums death without a testament, such property would pass to the transferor's
heirs intestate and be recoverable by them or by the Administrator of the transferor's estate.

Without necessarily according all these assertions its full concurrence, but upon the
consideration alone that the apparent gross, not to say enormous, disproportion between the
stipulated price (in each deed) of P l.00 plus unspecified and unquantified services and the
undisputably valuable real estate allegedly sold worth at least P10,500.00 going only by
assessments for tax purposes which, it is well-known, are notoriously low indicators of actual
value plainly and unquestionably demonstrates that they state a false and fictitious
consideration, and no other true and lawful cause having been shown, the Court finds both said
deeds, insofar as they purport to be sales, not merely voidable, but void ab initio.

Neither can the validity of said conveyances be defended on the theory that their true causa is
the liberality of the transferor and they may be considered in reality donations 18 because the
law 19 also prescribes that donations of immovable property, to be valid, must be made and
accepted in a public instrument, and it is not denied by the respondents that there has been no
such acceptance which they claim is not required

Moreno vs Private management office

A contract of sale is perfected at the moment there is a meeting of minds upon the thing which
is the object of the contract and upon the price.

To reach that moment of perfection, the parties must agree on the same thing in the same
sense,[15] so that their minds meet as to all the terms.[16] They must have a distinct intention
common to both and without doubt or difference; until all understand alike, there can be no
assent, and therefore no contract.[17] The minds of parties must meet at every point; nothing
can be left open for further arrangement.[18]So long as there is any uncertainty or
indefiniteness, or future negotiations or considerations to be had between the parties, there is
not a completed contract, and in fact, there is no contract at all.

Here, The letter clearly states that P21,000,000.00 is merely a suggested indicative price of the
subject floors as it was yet to be approved by the Board of Trustees. Before the Board could
confirm the suggested indicative price, the Committee on Privatization must first approve the
terms of the sale or disposition.

It appears in the case at bar that petitioners construction of the letter of February 22,
1993 that his assent to the suggested indicative price of P21,000,000.00 converted it as the
price certain, thus giving rise to a perfected contract of sale[34] is petitioners own subjective
understanding. As such, it is not shared by respondent. Under American jurisprudence, mutual
assent is judged by an objective standard, looking to the express words the parties used in the
contract.[35] Under the objective theory of contract, understandings and beliefs are effective
only if shared.[36] Based on the objective manifestations of the parties in the case at bar, there
was no meeting of the minds. That the letter constituted a definite, complete and certain offer
is the subjective belief of petitioner alone. The letter in question is a mere evidence of
a memorialization of inconclusive negotiations, or a mere agreement to agree, in which
material term is left for future negotiations.[37] It is a mere evidence of the parties preliminary
transactions which did not crystallize into a perfected contract. Preliminary negotiations or an
agreement still involving future negotiations is not the functional equivalent of a valid,
subsisting agreement. For a valid contract to have been created, the parties must have
progressed beyond this stage of imperfect negotiation. But as the records would show, the
parties are yet undergoing the preliminary steps towards the formation of a valid contract.
Having thus established that there is no perfected contract of sale in the case at bar, the issue
on estoppel is now moot and academic.

Navara vs Platers development bank

In general, contracts undergo three distinct stages, to wit: negotiation, perfection or birth, and
consummation. Negotiation begins from the time the prospective contracting parties manifest
their interest in the contract and ends at the moment of their agreement. Perfection or birth of
the contract takes place when the parties agree upon the essential elements of the
contract, i.e., consent, object and price. Consummation occurs when the parties fulfill or
perform the terms agreed upon in the contract, culminating in the extinguishment thereof.
A negotiation is formally initiated by an offer which should be certain with respect to both the
object and the cause or consideration of the envisioned contract. In order to produce a
contract, there must be acceptance, which may be express or implied, but it must not qualify
the terms of the offer. The acceptance of an offer must be unqualified and absolute to perfect
the contract. In other words, it must be identical in all respects with that of the offer so as to
produce consent or meeting of the minds.

Was the offer certain and the acceptance absolute enough so as to engender a meeting
of the minds between the parties? Definitely not.
While the foregoing letters indicate the amount of P300,000.00 as down payment, they
are, however, completely silent as to how the succeeding installment payments shall be made.
At most, the letters merely acknowledge that the down payment of P300,000.00 was agreed
upon by the parties. However, this fact cannot lead to the conclusion that a contract of sale had
been perfected.
Too, the Navarras letter/offer failed to specify a definite amount of the purchase price
for the sale/repurchase of the subject properties. It merely stated that the purchase price will
be based on the redemption value plus accrued interest at the prevailing rate up to the date of
the sales contract. Clearly, then, the lack of a definite offer on the part of the spouses could not
possibly serve as the basis of their claim that the sale/repurchase of their foreclosed properties
was perfected. The reason is obvious: one essential element of a contract of sale is wanting: the
price certain. There can be no contract of sale unless the following elements concur: (a) consent
or meeting of the minds; (b) determinate subject matter; and (c) price certain in money or its
equivalent. Such contract is born or perfected from the moment there is a meeting of minds
upon the thing which is the object of the contract and upon the price. [7] Here, what is
dramatically clear is that there was no meeting of minds vis-a-vis the price, expressly or
impliedly, directly or indirectly.
Bible Baptist vs CA

Art. 1479. A promise to buy and sell a determinate thing for a price certain is reciprocally demandable.

An accepted unilateral promise to buy or to sell a determinate thing for a price certain is binding upon
the promissor if the promise is supported by a consideration distinct from the price.

For an option contract to be valid and enforceable against the promissor, there must be a separate and
distinct consideration that supports it.

In tthis case, petitioner Baptist Church seeks to buy the leased premises from the spouses Villanueva,
under the option given to them. Petitioners claim that the Baptist Church agreed to advance the large
amount needed for the rescue of the property but, in exchange, it asked the Villanuevas to grant it a
long term lease and an option to buy the property for P1.8 million.[8] They argue that the consideration
supporting the option was their agreement to pay off the Villanuevas P84,000 loan with the bank,
thereby freeing the subject property from the mortgage encumbrance. This Court agrees with
respondents that the amount of P84,000 has been fully exhausted and utilized by their occupation of
the premises and there is no separate consideration to speak of which could support the option.

In Villamor v. Court of Appeals,[14] this Court defined consideration as the why of the contracts, the
essential reason which moves the contracting parties to enter into the contract.[15] This definition
illustrates that the consideration contemplated to support an option contract need not be monetary.
Actual cash need not be exchanged for the option. However, by the very nature of an option contract, as
defined in Article 1479, the same is an onerous contract for which the consideration must be something
of value, although its kind may vary.

To summarize the rules, an option contract needs to be supported by a separate consideration. The
consideration need not be monetary but could consist of other things or undertakings. However, if the
consideration is not monetary, these must be things or undertakings of value, in view of the onerous
nature of the contract of option. Furthermore, when a consideration for an option contract is not
monetary, said consideration must be clearly specified as such in the option contract or clause.

Villonco vs Bormaheco

The contract of sale is perfected at the moment there is a meeting of minds upon the thing which is the object of the
contract and upon the price. From that moment, the parties may reciprocally demand performance, subject to the
provisions of the law governing the form of contracts" (Art. 1475, Ibid.).

Bormaheco's acceptance of Villonco Realty Company's offer to purchase the Buendia Avenue property, as shown in
Teofilo Villonco's letter dated March 4, 1964 (Exh. D), indubitably proves that there was a meeting of minds upon the
subject matter and consideration of the sale. Therefore, on that date the sale was perfected.

Bormaheco, Inc. and the Cervantes spouses contend that the sale was not perfected because Cervantes allegedly
qualified his acceptance of Villonco's revised offer and, therefore, his acceptance amounted to a counter-offer which
Villonco Realty Company should accept but no such acceptance was ever transmitted to Bormaheco, Inc. which,
therefore, could withdraw its offer
That contention is not well-taken. It should be stressed that there is no evidence as to what changes were made by
Cervantes in Villonco's revised offer. And there is no evidence that Villonco Realty Company did not assent to the
supposed changes and that such assent was never made known to Cervantes.

The truth is that the alleged changes or qualifications in the revised counter — offer (Exh. D) are not material or are
mere clarifications of what the parties had previously agreed upon.

The controlling fact is that there was agreement between the parties on the subject matter, the price and the mode of
payment and that part of the price was paid. "Whenever earnest money is given in a contract of sale, it shall be
considered as part of the price and as proof of the perfection of the contract" (Art. 1482, Civil Code).

It is clear that the statement "that final negotiations on both property can be definitely known after 45 days" does not
and cannot mean that Bormaheco, Inc. should acquire the Nassco property within forty-five days from February 12,
1964 as pretended by Cervantes. It is simply a surmise that after forty-five days (in fact when the forty-five day period
should be computed is not clear) it would be known whether Bormaheco, Inc. would be able to acquire the Nassco
property and whether it would be able to sell the Buendia property. That aforementioned paragraph 5 does not even
specify how long after the forty-five days the outcome of the final negotiations would be known.

The appellants, in their fifth assignment of error, argue that Bormaheco, Inc. cannot be required to sell the three lots
in question because they are conjugal properties of the Cervantes spouses. They aver that Cervantes in dealing with
the Villonco brothers acted as president of Bormaheco, Inc. and not in his individual capacity and, therefore, he did
not bind the conjugal partnership nor Mrs. Cervantes who was allegedly opposed to the sale.

Those arguments are not sustainable. It should be remembered that Cervantes, in rescinding the contract of sale and
in returning the earnest money, cited as an excuse the circumstance that there was no certainty in Bormaheco's
acquisition of the Nassco property (Exh. F and Annex 1). He did not say that Mrs. Cervantes was opposed to the sale
of the three lots. He did not tell Villonco Realty Company that he could not bind the conjugal partnership. In truth, he
concealed the fact that the three lots were registered "in the name of FRANCISCO CERVANTES, Filipino, of legal
age, married to Rosario P. Navarro, as owner thereof in fee simple". He certainly led the Villonco brothers to believe
that as president of Bormaheco, Inc. he could dispose of the said lots. He inveigled the Villoncos into believing that
he had untrammelled control of Bormaheco, Inc., that Bormaheco, Inc. owned the lots and that he was invested with
adequate authority to sell the same.

Taking into account the situation of Cervantes vis-a-vis Bormaheco, Inc. and his wife and the fact that the three lots
were entirely occupied by Bormaheco's building, machinery and equipment and were mortgaged to the DBP as
security for its obligation, and considering that appellants' vague affirmative defenses do not include Mrs.
Cervantes' alleged opposition to the sale, the plea that Cervantes had no authority to sell the lots strains the
rivets of credibility (Cf. Papa and Delgado vs. Montenegro, 54 Phil. 331; Riobo vs. Hontiveros, 21 Phil. 31).

Oesmer vs paraiso

It is true that the signatures of the five petitioners, namely: Enriqueta, Librado, Rizalino, Bibiano, Jr., and
Leonora, on the Contract to Sell did not confer authority on petitioner Ernesto as agent authorized to
sell their respective shares in the questioned properties because of Article 1874 of the Civil Code, which
expressly provides that:

Art. 1874. When a sale of a piece of land or any interest therein is through an agent, the
authority of the latter shall be in writing; otherwise, the sale shall be void.
As can be clearly gleaned from the contract itself, it is not only petitioner Ernesto who signed
the said Contract to Sell; the other five petitioners also personally affixed their signatures
thereon. Therefore, a written authority is no longer necessary in order to sell their shares in the
subject parcels of land because, by affixing their signatures on the Contract to Sell, they were
not selling their shares through an agent but, rather, they were selling the same directly and in
their own right.

It is well-settled that contracts are perfected by mere consent, upon the acceptance by the
offeree of the offer made by the offeror. From that moment, the parties are bound not only to
the fulfillment of what has been expressly stipulated but also to all the consequences which,
according to their nature, may be in keeping with good faith, usage and law. To produce a
contract, the acceptance must not qualify the terms of the offer. However, the acceptance may
be express or implied. For a contract to arise, the acceptance must be made known to the
offeror. Accordingly, the acceptance can be withdrawn or revoked before it is made known to
the offeror.

In the case at bar, the Contract to Sell was perfected when the petitioners consented to the sale
to the respondent of their shares in the subject parcels of land by affixing their signatures on the
said contract.Such signatures show their acceptance of what has been stipulated in the Contract
to Sell and such acceptance was made known to respondent corporation when the duplicate
copy of the Contract to Sell was returned to the latter bearing petitioners signatures.

n the instant case, the consideration of P100,000.00 paid by respondent to petitioners was referred to
as option money. However, a careful examination of the words used in the contract indicates that the
money is not option money but earnest money. Earnest money and option money are not the same but
distinguished thus: (a) earnest money is part of the purchase price, while option money is the money
given as a distinct consideration for an option contract; (b) earnest money is given only where there is
already a sale, while option money applies to a sale not yet perfected; and, (c) when earnest money is
given, the buyer is bound to pay the balance, while when the would-be buyer gives option money, he is
not required to buy, but may even forfeit it depending on the terms of the option.

Heirs of Biona vs CA

We agree with the private respondent that all the requisites for a valid contract of sale are present
in the instant case. For a valuable consideration of P4,500.00, Soledad Biona agreed to sell and actually
conveyed the subject property to private respondent. The fact that the deed of sale was not notarized
does not render the agreement null and void and without any effect. The provision of Article 1358 of the
Civil Code[9] on the necessity of a public document is only for convenience, and not for validity or
enforceability.[10] The observance of which is only necessary to insure its efficacy, so that after the
existence of said contract had been admitted, the party bound may be compelled to execute the proper
document.[11] Undeniably, a contract has been entered into by Soledad Biona and the private
respondent. Regardless of its form, it was valid, binding and enforceable between the parties. We quote
with favor the respondent court's ratiocination on the matter:

xxx The trial court cannot dictate the manner in which the parties may execute their agreement, unless
the law otherwise provides for a prescribed form, which is not so in this case. The deed of sale so
executed, although a private document, is effective as between the parties themselves and also as the
third persons having no better title, and should be admitted in evidence for the purpose of showing the
rights and relations of the contracting parties (Carbonell v. Court of Appeals, 69 SCRA 99; Elumbaring v.
Elumbaring, 12 Phil. 384). Under Art. 1356 of the Civil Code, contracts shall be obligatory in whatever
form they may have been entered into provided all the essential requisites for their necessary elements
for a valid contract of sale were met when Soledad Biona agreed to sell and actually conveyed Lot 177 to
defendant-appellant who paid the amount of P4,500.00 therefore. The deed of sale (Exh. 2) is not made
ineffective merely because it is not notarized or does not appear in a public document. The contract is
binding upon the contracting parties, defendant-appellant and Soledad Biona, including her successors-
in-interest. Pursuant to Art. 1357, plaintiffs-appellees may be compelled by defendant-appellant to
execute a public document to embody their valid and enforceable contract and for the purpose of
registering the property in the latter's name (Clarin v. Rulona, 127 SCRA 512; Heirs of Amparo v. Santos,
108 SCRA 43; Araneta v. Montelibano, 14 Phil. 117).[12]

Finally, we find no merit in petitioners' contention that their right over the land has not prescribed. The
principle of laches was properly applied against petitioner. Laches has been defined as the failure or
neglect, for an unreasonable and unexplained length of time, to do that which by exercising due
diligence could or should have been done earlier, it is negligence or omission to assert a right within a
reasonable time, warranting a presumption that the party entitled to assert it has either abandoned it
or declined to assert it.[13] In the instant case, the Court of Appeals point to the circumstances that
warrant the principle to come into play:

It is not disputed, however, that as early as 1960, when Soledad Biona borrowed money from
defendant-appellant (Exh. L), the latter entered, possessed and started occupying the same in the
concept of an owner. He caused its cultivation through various tenants under Certificates of Land
Transfer (Exhs. 7-9), declared the property in his name, religiously paid taxes thereon, reaped benefits
therefrom, and executed other acts of dominion without any protest or interference from plaintiffs-
appellees for more than twenty-five years. Even when the five daughters of the deceased Ernesto Biona
were way past the age of majority, when they could have already asserted their right to their share, no
sale in defendant-appellant's favor was ever brought or any other action was taken by them to recover
their share. Instead, they allowed defendant-appellant to peacefully occupy the property without
protest. Although it is true that no title to registered land in derogation of that of the registered owner
shall be acquired by prescription or adverse possession as the right to recover possession of registered
land is imprescriptible, jurisprudence has laid down the rule that a person and his heirs may lose their
right to recover back the possession of such property and title thereto by reason of laches.

Pagaduan vs spouses ocuma

ART. 1544. If the same thing should have been sold to different vendees, the ownership shall be
transferred to the person who may have first possession thereof in good faith, if it should be movable
property.

Should it be immovable property, the ownership shall belong to the person acquiring it who in good
faith first recorded it in the Registry of Property.

Should there be no inscription, the ownership shall pertain to the person who in good faith was first in
possession; and, in the absence thereof; to the person who presents the oldest title, provided there is
good faith.

Otherwise stated, where it is an immovable property that is the subject of a double sale, ownership shall
be transferred: (1) to the person acquiring it who in good faith first recorded it in the Registry of
Property; (2) in default thereof, to the person who in good faith was first in possession; and (3) in
default thereof, to the person who presents the oldest title, provided there is good faith. The
requirement of the law then is two-fold: acquisition in good faith and registration in good faith

In this case there was a first sale by Eugenia Reyes to Agaton Pagaduan and a second sale by Eugenia
Reyes to the respondents.[13] For a second buyer like the respondents to successfully invoke the second
paragraph, Article 1544 of the Civil Code, it must possess good faith from the time of the sale in its favor
until the registration of the same. Respondents sorely failed to meet this requirement of good faith
since they had actual knowledge of Eugenias prior sale of the southern portion property to the
petitioners, a fact antithetical to good faith. This cannot be denied by respondents since in the same
deed of sale that Eugenia sold them the northern portion to the respondents for P1,500.00, Eugenia also
sold the southern portion of the land to Agaton Pagaduan for P500.00.