21. LOCSIN vs HIZON, G.R. No.

204369, September 17, 2014

FACTS: Petitioner as the registered owner of the lot, filed an ejectment case against one
Aceron before the MTC to recover possession over the land in issue. Eventually, the two
entered into a compromise agreement, which the MTC approved. Locsin later went to the
United States without knowing whether Aceron has complied with his part of the bargain
under the compromise agreement. In spite of her absence, however, she continued to
pay the real property taxes on the subject lot. When Locsin discovered that her copy of
the TCT was missing, Locsin filed a petition for administrative reconstruction to secure a
new one. Sometime in early 2002, she discovered through her counsel that Bolos was
able to secure a new TCT by virtue of a Deed of Absolute Sale executed by her and later
titled to Carlos. She then sent Carlos a letter requesting the return of the property since
her signature in the purported deed of sale in favor of Bolos was a forgery.
Carlos claimed that he was unaware of any defect or flaw in Bolos’ title and he is,
thus, an innocent purchaser for value and good faith. Bernardo, father of Carlos’ and who
bought the property, met with Locsin’s counsel and discussed a compromise, which
turned out to be deceitful, for Locsin learned that Carlos had already sold the property for
to his sister and her husband, herein respondents Sps Guevara, who had a new certificate
of title issued in their names. The sps Guevara then immediately mortgaged the said
property. It was against the foregoing backdrop of events that Locsin filed an action for
reconveyance, annulment of the TCT, cancellation of the mortgage lien annotated
thereon, and damages. RTC dismissed the complaint which was affirmed by CA wherein
it was ruled that respondents are innocent purchasers for value and Locsin can no longer
recover the subject lot.

Issue:Whether or not respondents are innocent purchasers for value.

Held: No. An innocent purchaser for value is one who buys the property of another without
notice that some other person has a right to or interest in it, and who pays a full and fair
price at the time of the purchase or before receiving any notice of another person’s claim.
Complementing this is the mirror doctrine which echoes the doctrinal rule that every
person dealing with registered land may safely rely on the correctness of the certificate
of title issued therefor and is in no way obliged to go beyond the certificate to determine
the condition of the property. The recognized exception to this rule is that when the party
has actual knowledge of facts and circumstances that would impel a reasonably cautious
man to make such inquiry or when the purchaser has knowledge of a defect or the lack
of title in his vendor or of sufficient facts to induce a reasonably prudent man to inquire
into the status of the title of the property in litigation. One who falls within the exception
can neither be denominated an innocent purchaser for value nor a purchaser in good faith
and, hence, does not merit the protection of the law.
In the case at bar, Bolos’ certificate of title was concededly free from liens and
encumbrances on its face. However, the failure of Carlos and the spouses Guevara to
exercise the necessary level of caution in light of the factual milieu surrounding the
sequence of transfers from Bolos to respondents bars the application of the mirror
doctrine and inspires the Court’s concurrence with petitioner’s proposition. Bernardo
knew that Bolos, from whom he purchased the subject property, never acquired
possession over the lot. Bolos’ purported Deed of Sale was executed in 1979 but the
ejectment case commenced by Locsin against Aceron was in 1992, or thirteen (13)years
after the property was supposedly transferred to Bolos. Having knowledge of the
foregoing facts, Bernardo and Carlos, to our mind, should have been impelled to
investigate the reason behind the arrangement. They should have been pressed to
inquire into the status of the title of the property in litigation in order to protect Carlos’
interest. Entering into a compromise agreement is an act of strict dominion. If Bolos
already acquired ownership of the property as early as 1979, it should have been her who
entered into a compromise agreement with Aceron in 1993, not her predecessor-in-
interest, Locsin, who, theoretically, had already divested herself of ownership thereof.
The spouses Guevara are not innocent purchasers for value, the transfer from
Carlos to the spouses Guevara was effected only 15 days after Locsin demanded the
surrender of the property from Carlos. The fact that Lourdes Guevara and Carlos are
siblings, and that Carlos’ agent in his dealings concerning the property is his own father,
renders incredible the argument that Lourdes had no knowledge whatsoever of Locsin’s
claim of ownership at the time of the purported sale. There is also strong reason to believe
that even the mortgage in favor of DCC was a mere ploy to make it appear that the Sps.
Guevara exercised acts of dominion over the subject property. This is so considering the
proximity between the property’s registration in their names and its being subjected to the
mortgage. These circumstances, taken altogether, strongly indicate that Carlos and the
spouses Guevara failed to exercise the necessary level of caution expected of a bona
fide buyer and even performed acts that are highly suspect. Consequently, this Court
could not give respondents the protection accorded to innocent purchasers in good faith
and for value.

22. LIMSON vs Wack Wack Condominium Corp., G.R. No. 188802, February 14, 2011

FACTS: Petitioner purchased from Benitez an apartment unit at Wack Wack Apartments.
Upon moving in, she noticed defects in the electrical main panel hence, reported by
writing to respondent. Gonzalez, a Member of respondents Board of Directors, replied
by letter that, it is the duty of the unit owner to maintain the electrical and plumbing
systems at her expense under House Rules and Regulations. Thereafter, Petitioner
informed respondent that the switch board is such that No. 12 wire is protected by 30
ampere fuse and that five appliances are connected to only one fuse and later sought
professional assistance from a private electrical consultant, who concluded that the
wirings are unsafe, hazardous and did not comply with the Philippine Electrical Code. City
Building Office conducted an inspection and recommended replacement of fusible load
center with panel board and circuit breaker components and to submit a built electrical
plan signed by a Professional Electrical Engineer. Respondent wrote Revelina to demand
that repairs be undertaken within 10 days and imposed a daily fine. Petitioner refused to
undertake the repairs and to pay the fine and claimed that the electrical main panel forms
part of the common areas, citing RA 4726, An Act to Define Condominium, Establish
Requirements for Its Creation and Government of Its Incidents, arguing that an electrical
main panel is in the nature of a utility installation. Respondent filed a complaint for specific
performance and damages against the petitioner to compel Sps Limson to undertake the
necessary repairs of the defective and hazardous condition of the electrical wiring of their
Unit and seek payment of liquidated damages. Assessments and penalties were charged
against the spouses and respondent filed a Notice of Assessment with the Register of
Deeds with application for foreclosure and public auction of the Unit, which was then
purchased by the respondent. RTC dismissed respondent’s complaint for and ruled that
the questioned electrical installations are to be considered as part of the common area
and not of Unit 703, though the same are necessarily found inside the said unit. CA
reversed the decision of the trial court, holding in the main that for the electrical main
panel to be considered as part of the common areas, it should have been intended for
communal use and benefit. The subject electrical main panel being located inside the unit
and its principal function being to control the flow of electricity into the unit, the appellate
court concluded that charges for its repair cannot be for respondents account.

ISSUE: W/N unit owner has the duty to maintain electrical and plumbing system.

Held: No. In a multi-occupancy dwelling such as Apartments, limitations are imposed

under R.A. 4726 in accordance with the common interest and safety of the occupants
therein which at times may curtail the exercise of ownership. Upon acquisition of a unit,
the owner not only affixes his conformity to the sale; he also binds himself to a contract
with other unit owners. Unquestionably, the fuse box controls the supply of electricity into
the unit. Power is sourced through jumper cables attached to the main switch which
connects the units electrical line to the Apartments common electrical line. It is an integral
component of a power utility installation. Respondent cannot disclaim responsibility for
the maintenance of the Apartments electrical supply system solely because a component
thereof is placed inside a unit. Utility installations forms part of the common areas, which
reference is justified by practical considerations. Repairs to correct any defects in the
electrical wiring should be under the control and supervision of respondent to ensure
safety and compliance with the Philippine Electrical Code, not to mention security and
peace of mind of the unit owners.