Wrong procedure

If a Certificate of Title is reconstituted because it was lost or destroyed but the lien or encumbrance duly noted in the lost title does not appear in the reconstituted title, is it the ministerial duty of the Register of Deeds to record such lien or encumbrance on the reconstituted title? What is the proper procedure for the notation of such lien or encumbrance in the reconstituted title? These are the questions answered in this case involving four Certificates of Titles Nos. 136640, 136444, 222370 and 134249 (the TCTs) covering five parcels of land belonging to a textile company (PMI).

On July 19, 1979, the said parcels of land were purchased on installment basis by Vijay and Eng, an Indian and a Chinese businessman.

On August 17, a writ of preliminary attachment was annotated on the TCTs by virtue of a suit before the Regional Trial Court (RTC) filed by a cotton corporation (PCC) against PMI for the latter’s failure to pay its obligations under a contract of loan with the former. The said case was decided in favor of PCC ordering PMI to pay its loan plus interest, penalty charges, attorney’s fees and cost of suit. PMI however appealed this decision to the Supreme Court (SC).

On June 11, 1988 while the appeal was pending, fire destroyed the records of the Register of Deeds including the TCTs of PMI.

Sometime in 1992, PMI filed a petition for administrative reconstitution of the TCTs. So on March 23, 1992, the Register of Deeds issued to PMI the reconstituted titles. However the annotations of preliminary attachment in favor of PCC were not incorporated in the reconstituted TCTs. Only the sale made by PMI in favor of Vijay and Eng and their full payment were annotated therein. So on the same date the reconstituted TCTs were cancelled and new titles without any annotation were issued in the names of Vijay and Eng.

When PCC learned about this omission, they wrote the Register of Deeds requesting for the re-annotation of the notice of levy on attachment as well as the entry of judgment of the SC which has, in the meantime already ruled with finality in favor of PCC and against PMI on the latter’s appeal. PCC insisted that the Register of Deeds has the duty and authority to re-annotate the said notice and entry of judgment of the SC in the reconstituted TCTS issued in the names of Vijay and Eng. Was PCC correct?

No. It is not the ministerial function of the Register of Deeds to record a right or an interest that was not duly noted in the reconstituted certificate of title. This task is not even within the ambit of the Register of Deeds’ job as the responsibility is lodged by law to the proper courts. The procedure for the reconstitution of Torrens Certificate of Title lost or destroyed is specifically provided in Sections 8 and 11 of R.A. 26. Any person, like PCC, whose right or interest was duly noted in the original certificate of title at the time it was lost or destroyed but does not appear so noted in the reconstituted title may file a petition with the proper court for the annotation of such right or interest. The petition shall be accompanied with the necessary documents and shall state, among others, the number of the certificate of title and the nature as well as a description of the interest, lien or encumbrance to be reconstituted. And the court, after due publication, notice and hearing shall determine the merits of the petition and render such judgment as justice and equity may require.

Moreover, under Chapter X Section 108 of the Property Registration Decree, P.D. 1529, the court’s intervention is necessary in the amendment of the registration book after the entry of a certificate of title or of a memorandum thereon. It cannot be made by mere allegations of PCC. Hence its contention that the Register of Deeds may validly re-annotate the encumbrance/liens and annotate the SC decision on the administratively reconstituted TCTs has no basis in law and jurisprudence (Philippine Cotton Corp. vs. Gagoomal and Ang etc. G.R. 130389, February 11, 2008).

Note: Books containing compilation of my articles on Labor Law and Criminal Law (Vols. I and II) are now available. Call tel. 7249445.

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