Sps. Honorio Santiago v. The Court of Appeals (Fifteenth Division)

Summary

This case involves a double sale of a 100 square-meter lot in Makati. The Santiago spouses purchased the property first in 1978-1979 from Evelyn Mercado, took possession of the owner's duplicate title, and registered their deed in 1982, receiving a new certificate of title. Aquilino Arevalo purchased the same lot in February 1982 but never registered his deed or took possession. The trial court and Court of Appeals ruled in favor of Arevalo, finding the Santiago spouses acted in bad faith. However, the Supreme Court reversed, applying Article 1544 of the Civil Code which governs double sales. The Court held that good faith is presumed and that the Santiago spouses, being first buyers who registered in good faith and took possession, have superior rights. The Court found no evidence of bad faith and criticized the lower courts for basing their conclusions on irrelevant circumstances and speculation. The decision reinforces the principle that in double sales of immovable property, ownership belongs to the person who first recorded the sale in good faith.