Romeo P. Co v. Court of Appeals

Summary

This case involves a complex property dispute arising from a trust arrangement and subsequent double sale. Marcelita Co purchased land in 1965 but had title placed in her brother Ruperto Padonan's name as trustee. In 1973, Padonan executed a deed of sale to Co pursuant to their trust agreement, but in 1974, he also sold the same property to the Memije spouses who registered their title. When the Memije spouses sued for recovery of possession, the Co spouses raised ownership claims as counterclaim and affirmative defense. The Supreme Court held that such claims constituted an impermissible collateral attack on the Torrens title and that the counterclaim was not compulsory. Under Article 1544 on double sales, the Memije spouses prevailed as the first to register in good faith. The Court emphasized that Torrens titles can only be attacked directly, not collaterally, and that registered owners have superior possessory rights absent successful direct challenge to their title.