I bought a property last year. Last month, someone approached me claiming that he also bought the property from the same seller. It turns out the seller sold the property to another person after I bought it. May I know how will this affect my right to the property? Will it hinder my plan to transfer the title of the property in my name?
It appears from your narration that there was a double sale. By and large, a double sale occurs when a vendor sells the same property to two or more vendees with different interests. In these types of cases, our state adopts the principle of prius tempore, potior jure. It means, he who is first in time is stronger in right (Gabriel vs. Mabanta, G399 SCRA 573 citing Uraca vs. Court of Appeals 278 SCRA 702). In case of a double sale, the law provides that “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 the possession; and, in the absence thereof, to the person who presents the oldest title, provided there is good faith” (Article 1544, Civil Code). Thus, the order of priority is as follows: first person to register the sale in good faith; the first possessor in good faith; and the buyer who in good faith presents the oldest title.
Please take note that the law requires good faith on the part of the buyer. Good faith in this case means the person must have bought the property without notice that some other person has a right or interest in such property and pays a full and fair price for the same before he has notice of the other person’s claim (De Leon vs. Ong, 611 SCRA 381 citing Centeno vs. Sps. Viray, 440 Phil. 881). The buyer must not be aware that there are other claimants who derive their interest from the same seller.
This good faith requirement is applied differently to the first and subsequent buyers with respect to registration of title. As laid down by the Supreme Court, the rule is that knowledge by the first buyer of the second sale cannot defeat his rights except when the second buyer first registers his title in good faith, while knowledge gained by the second buyer of the first sale defeats his rights even if he is first to register, since such knowledge taints his registration with bad faith (Uraca vs. Court of Appeals, 344 Phil. 253). Hence, the first buyer, as the one who is first in time, is allowed to register his title even after gaining knowledge that the seller has sold the property to other persons. On the other hand, the second buyer is only allowed to register his title before receiving information that there was a prior sale to another, but not after.
Taking the foregoing into consideration, your right to the property as the first buyer will only be defeated by the second buyer if he registered his title or first took possession of the property before gaining knowledge of your claim. If the second buyer failed to do either of these two, you have greater right to the property and you are free to register the sale and secure title in your name.
Please bear in mind that the opinion given above is strictly based on the information you have provided 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