[ G.R. No. 48290. September 30, 1942 ] 73 Phil. 694
[ G.R. No. 48290. September 30, 1942 ]
JULIAN MEDIANTE AND NICOMEDES GARCIA, PLAINTIFFS AND APPELLEES, VS. VALENTIN ROSABAL, DEFENDANT AND APPELLANT; CLEOFE VDA. DE NERI, INTERVENOR AND APPELLANT. D E C I S I O N
PARAS, J.:
The land here in question originally belonged to Macario Rosabal and Tomasa Valmoria who, on April 9, 1929, executed an alleged contract of sale—which was never recorded in the registry of deeds—in favor of Ramon Neri San Jose, deceased husband of the intervenor-appellant, for the consideration of P500, with right of repurchase within three years. The land, however, remained in the possession of the defendant Valentin Rosabal, son of the vendors, under an alleged contract of lease requiring the payment of a quarterly rental of P30. By virtue of a writ of execution issued in civil case No. 8521 of the justice of the peace court of Cebu, entitled Texaco Co., Inc. vs. Valentin Rosabal and Macario Rosabal, the same land was sold at public auction to the plaintiff Nicomedes Garcia for P445.50 on April 17, 1931, a sale which was recorded in the registry of deeds of Misamis Oriental on June 25, 1931. On May 14, 1931, Nicomedes Garcia in writing allowed Valentin Rosabal to redeem the land (Exhibit B of the plaintiff—Exhibit 3 of the defendant) and accordingly received from the latter P120 upon account of the redemption price, which payment was later increased to P200, after which no other sum is alleged to have been paid. Subsequently, Nicomedes Garcia sold his rights and interest over the land to the plaintiff Julian Mediante who thereafter brought an action against Valentin Rosabal for the recovery of said land, which action was however dismissed. In the present case, the plaintiff Julian Mediante and the intervenor Cleofe Vda. de Neri both claim ownership, and seek to recover the possession, of the land in question, the first relying on the title acquired by him from his co-plaintiff Nicomedes Garcia, and the second on the sale made by Macario Rosabal and Tomasa Valencia (parents of the defendant Valentin Rosabal) to her deceased husband Ramon Neri San Jose. The Court of First Instance of Misamis Oriental gave judgment for the plaintiff Julian Mediante, on the ground that the sheriff’s sale under which his grantor derived title, being registered in the registry of deeds, gave him proprietary rights superior to the unregistered sale relied upon by the intervenor-appellant in conformity with article 1473 of the Civil Code. As regards the defendant Valentin Rosabal, the trial court ruled that, as he failed to pay the redemption price in full, the ownership of the land had become consolidated in Nicomedes Garcia. The present appeal was interposed by the defendant, as well as by the intervenor. The first ground advanced by the trial court for its judgment cannot be sustained, since article 1473 of the Civil Code, which gives preference to one of two deeds which is first recorded, is not applicable to an execution sale of real estate not registered under Act No. 496. [Fabian vs. Smith, Bell & Co. (8 Phil., 496) ; Boncan vs. Smith, Bell & Co. (9 Phil., 109) ; Casimiro vs. Fernandez (9 Phil., 562); Buzon vs. Licauco (13 Phil, 354).] Neither can the second ground be upheld. The moment the purchaser (Nicomedes Garcia) at the sheriff’s sale accepted partial payment from the judgment debtor (Valentin Rosabal) upon account of the redemption price, a resale was effected in the latter’s favor, and Garcia was only entitled to recover the balance from Rosabal and to look to the land merely as security for its payment, the reason being that Garcia was under no obligation to receive less than the whole amount of the repurchase money and by his acceptance of a part thereof, he changed the character of his title and surrendered his right to enforce a forfeiture under the statute. [21 American Jurisprudence, 125, and Murphy vs. Teutsch (132 N. W., 435, 436), citing Southard vs. Pope’s Ex’rs. (48 Ky., 261) ; Ott. vs. Rape (24 Wis., 336; 1 Am. Rep., 186); Whiting vs. Butler (29 Mich., 133) ; Spath vs. Hankins (55 Ind., 155) ; Felton vs. Smith (84 Ind., 486).] With respect to so much of the case as refers to the opposing claims of the defendant Valentin Rosabal and the intervenor Cleofe Vda. de Neri, it is the opinion of the court that the alleged sale with pacto de retro relied upon by the latter is really an equitable mortgage, in view of the following considerations: (1) The vendors, through their son, the defendant Valentin Rosabal, remained in possession of the land sold. It must be remembered, in this connection, that the latter was considered an owner of the land even during the life of the alleged sale with pacto de retro, not only because it was levied upon and sold by the sheriff in connection with civil case No. 8521 as his and his father’s property, but because the purchaser at the execution sale allowed him to redeem it under the circumstances hereinabove noted. (2) Valentin Rosabal was required to pay during his possession the rental of P30 every three months, obviously in the nature of interest. (3) In spite of his failure to pay the alleged rentals, the vendee or his successor in interest did not care to take legal steps for his ejectment and for the first time asserted a claim of ownership only upon the filing by the plaintiffs of the present case in 1935 (or more than three years after the expiration of the period of redemption fixed in the alleged sale), Cleofe Vda. de Neri appearing merely as an intervenor. The appealed judgment is, therefore, reversed, and the defendant-appellant, who is declared to be the owner of the land in question, is hereby sentenced to pay to the plaintiff Julian Mediante the sum of P245, and to the intervenor-appellant the sum of P500. As the equitable mortgage in favor of the intervenor-appellant is prior to the lien acquired by Julian Mediante under the execution sale, it is further held that the land is subject, first, to the intervenor’s equitable mortgage and, then, to Mediante’s lien. So ordered, without pronouncement as to costs. Yulo, C. J., Ozaeta, and Bocobo, JJ., concur.