MANILA, Philippines — The Supreme Court (SC) has ruled that land buyers must conduct due diligence by verifying ownership through the certificate of title and reviewing records in the Registry of Deeds to prevent fraudulent transactions.

The SC’s Third Division upheld the rulings of the Regional Trial Court (RTC) and the Court of Appeals (CA), which voided the land titles of Orencio and Eloisa Manalese (Spouses Manalese). 

The court found that they failed to exercise due diligence when purchasing land from Carina Pinpin, who had acquired her titles through fraudulent means.

Spouses Manalese bought two parcels of land from Pinpin, who presented certificates of title under her name and claimed to have purchased the properties from the original owners, Narciso and Ofelia Ferreras. 

However, Danilo Ferreras, administrator of the Ferreras estate, contested the validity of these transactions, arguing that the properties still legally belonged to the estate.

According to Danilo, Pinpin fraudulently obtained duplicate titles by submitting a false affidavit of loss and a forged deed of sale. She then used these falsified documents to sell the properties to Spouses Manalese a year later.

Although Spouses Manalese claimed they were innocent buyers relying on clean titles, the RTC and CA ruled them buyers in bad faith. 

The courts found that they ignored key red flags, including the notarization of the deed of sale after the original owners’ deaths and the significant price disparity—Pinpin acquired the properties for P250,000 but later sold them for P3,300,000.

The SC agreed with the findings of the lower courts, emphasizing that land buyers cannot rely solely on a certificate of title if there are indications of fraud or irregularity. 

The court stressed that under Presidential Decree No. 1529, a re-issued title is merely a duplicate and does not carry the same legal weight as the original title. Therefore, transactions based on a forged duplicate title are invalid.

Since the Registry of Deeds contained records of Pinpin’s affidavit of loss, the issuance of another set of duplicate titles, and subsequent annotations, the SC ruled that Spouses Manalese were presumed to have knowledge of the defects in Pinpin’s ownership.

Their failure to investigate these discrepancies disqualified them from claiming good faith.

In a Separate Concurring Opinion, Associate Justice Henri Jean Paul B. Inting agreed that Spouses Manalese were not buyers in good faith but expressed concerns about placing an excessive burden on land buyers. 

He argued that requiring buyers to investigate beyond a clean title could undermine the reliability of the land registration system.