ELVIRA T.

ARANGOTE, petitioner
v.
SPS MARTIN MAGLUNOB and LOURDES S. MAGLUNOB, and ROMEO
SALIDO, respondents
FACTS:
The petitioner, Elvira T. Arangote, is the registered owner of the
subject property, as evidenced by Original Certificate of Title (OCT) No.
CLOA-1748. Respondents Martin (Martin II) and Romeo are first cousins and
the grandnephews of Esperanza Maglunob-Dailisan (Esperanza), from whom
petitioner acquired the subject property.
The subject property is a property inherited by Esperanza from her
uncle Victorino Sorrosa by virtue of notarized Partition Agreement. Esperanza
executed a Last Will and Testament bequeathing the subject property to the
petitioner and her husband but it was not probated. She then executed an
Affidavit stating that she renounces all her rights, shares, interests and
participation in the subject property in favor of the petitioner and her
husband. A tax declaration of the said property was issued after the name of
the petitioner and her husband.
The respondents built a hollow block walls behind and in front of the
petitioners house which effectively blocked the main gate of the petitioner.
The petitioner then filed a civil case against the respondent. The respondent
contended that they co-owned the subject property since Esperanza and her
siblings inherited the subject property from Martin I Maglunob. That
Esperanza cannot entirely waive her rights over the entire subject property in
favor of the petitioner. Thus, the respondents prayed for the OCT of the
subject property to be null and void. Unfortunately, the MCTC ruled in favor
of the petitioner stating that the petitioner are the lawful owners of the
subject property. The respondents appealed in the RTC contending that the
MCTC erred in not dismissing the Complaint filed the Petitioner. The RTC
reversed the decision of the MCTC and ruled in favor of the respondents
making them the lawful owner of the subject property. The petitioners
appealed on RTC but it was denied. The petitioners appealed in the CA for
Petition of Review with the contention that the petitioners are
builders/possessors in good faith and that the respondents are not the lawful
owners and possessors of the whole subject property. The rendered a
decision denying the Petition for Review and the subsequent Motion for
Reconsideration.
ISSUE:
Whether or not the Petitioners are builders/possessors in good faith
considering that the subject property was declared by the RTC to be lawfully
owned and possessed by the respondents as they became co-owners,
together with Esperanza, to the subject property in lieu of the inheritance
from Martin Maglunob.
RULING:
No, the petitioner cannot be considered as builders/possesors in good
faith. Art 526 of the Civil Code states that He is deemed a possessor in
good faith who is not aware that there exists in his title or mode of
acquisition any flaw which invalidates it. Possession in good faith
ceases from the moment defects in the title are made known to the
possessor by extraneous evidence or by a suit for recovery of the property
by the true owner. Every possessor in good faith becomes a possessor
in bad faith from the moment he becomes aware that what he
believed to be true is not so. In the present case, when respondents

came to know that an OCT over the subject property was issued and
registered in petitioners name, respondents brought a Complaint
challenging the title of petitioner to the subject property on the basis
that said property constitutes the inheritance of respondent, together with
their grandaunt Esperanza, so Esperanza had no authority to relinquish the
entire subject property to petitioner. From that moment, the good faith
of the petitioner had ceased. Hence, the petitioner is not entitled to the
benefits of builder in good faith under the Art 448 and 546 of the civil code.
The petition is denied.