I purchased a parcel of land. I was working abroad at that time, so the transaction was facilitated through my sister. I just returned to our country, and I noticed that the deed of sale was not notarized.
Is it really necessary to have the contract notarized? I was informed that there is a law which states that the deed of sale should be notarized so I fear that the contract I am holding might be invalid.
As a rule, the notarization of a contract is not required for its validity. Article 1356 of the Civil Code clearly states that contracts are obligatory, in whatever form they may have been entered into, provided all the essential requisites for their validity are present. Further, Article 1318 of the same code which enumerates the requisites of a contract does not mention notarization. It only requires (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.
Now, Article 1358 of the Civil Code requires acts and contracts that create, transmit, modify or extinguish real rights over immovable property should appear in public document, which is achieved through notarization, suggesting that contracts involving land must be notarized. However, the said provision does not go into the validity of a contract, but rather ordered for the convenience of the contracting parties. As the Supreme Court declared in the case of Tigno v. Aquino, “we have even affirmed that a sale of real property though not consigned in a public instrument or formal writing, is nevertheless valid and binding among the parties, for the time-honored rule is that even a verbal contract of sale or real estate produces effects between the parties” (444 SCRA 61). Thus, even a deed of sale of land is valid between the parties even if it is not notarized.
Nevertheless, it becomes necessary to have the deed of sale notarized for registration purposes. Section 112 of the Property Registration Decree states that deeds, conveyances, encumbrances, discharges, powers of attorney and other voluntary instruments, whether affecting registered or unregistered land, executed in accordance with law in the form of public instruments shall be registerable implying that the contract must be notarized. Applying this provision of law, our Supreme Court in the case of Gallardo vs. Intermediate Appellate Court ruled that an unnotarized private deed of sale of land is definitely not registerable under the Land Registration Act (155 SCRA 248).
In sum, a private deed of sale involving land is valid and binding between the parties. Its validity is not affected by the lack of notarization. Yet, the contract should still be notarized so that it may be registered with the appropriate register of deeds as required by the Property Registration Decree.
We hope we were able to sufficiently address your concerns. Please bear in mind that this opinion is based on the facts you narrated and our appreciation of the same. Our opinion may vary if facts are changed or elaborated.
Editor’s note: Dear PAO is a daily column of the Public Attorney’s Office. Questions for Chief Acosta may be sent to firstname.lastname@example.org