Medina vs. Greenfield Development Corporation

A writ of preliminary injunction will not issue where the applicant's right is doubtful or disputed, as bare assertions of ownership cannot overcome the presumption of validity accorded to notarized deeds of conveyance and Torrens titles.

Pedro Medina, his brother Alberto Medina, and niece Nazaria Cruz executed a Contract to Sell in favor of Greenfield Development Corporation over two parcels of land in Muntinlupa in 1962. Subsequent notarized Deeds of Sale and a Deed of Absolute Sale with Mortgage were executed by Pedro, his children, Alberto, and Nazaria in favor of Greenfield. Greenfield registered the titles in its name. Decades later, Pedro's grandchildren (the petitioners) claimed co-ownership, alleged the deeds were simulated and the signatures fake, and asserted continued possession through a caretaker. After Greenfield fenced the property following an adverse claim annotation, petitioners sought injunctive relief to restore their access.

• The Properties and Sales: Pedro Medina, Alberto Medina, and Nazaria Cruz executed a notarized Contract to Sell on June 5, 1962, over Lot 90-A (TCT No. 100177) in favor of Greenfield. On June 27, 1962, a notarized Deed of Sale was executed by Pedro, his children (Cornelio, Brigida, Balbino, Gregoria, Crisanta, Rosila), Alberto, and Nazaria. On September 4, 1964, a notarized Deed of Absolute Sale with Mortgage was executed over Lot 90-B (TCT No. 100178) by the same individuals.
• Transfer of Titles: Greenfield registered the properties under its name (TCT No. 100578 and TCT No. 133444), which were later consolidated into TCT Nos. 202295, 202296, and 202297 in 1995.
• Petitioners' Claims: Petitioners, grandchildren of Pedro Medina, filed an action for annulment of titles and deeds, reconveyance, and damages in 1998. They claimed co-ownership, alleged the deeds were simulated and signatures fake, and asserted continued possession through caretaker Santos Arevalo.
• The Dispute: Petitioners annotated an adverse claim on the titles on July 13, 1998. Greenfield constructed a fence and posted security, blocking petitioners' ingress and egress, prompting the request for a temporary restraining order and preliminary injunction.
• Respondent's Defense: Greenfield denied the claims, citing its titles and public documents, and countered that Arevalo was its own employee, presenting a notarized Receipt and Quitclaim signed by Arevalo.

• Evidentiary Basis of CA Ruling: Petitioner argued that the CA erred in relying heavily on respondent's antecedent facts without evidentiary support.
• Validity of Deeds and Titles: Petitioner maintained that the CA prematurely upheld the validity of the deeds and titles, issues yet to be tried on the merits.
• Presumption of Validity: Petitioner contended that the presumption of validity for notarized documents and indefeasibility of Torrens titles should not apply because respondent was not an innocent purchaser, having known of a deceased co-owner (Leon Medina) at the time of the contract.
• Constructive vs. Actual Possession: Petitioner asserted that the CA erred in ruling respondent was in constructive possession despite petitioners' actual possession.
• Prescription: Petitioner argued that the action does not prescribe because it is based on the inexistence of a contract.

• Ownership and Validity: Respondent countered that petitioners have no valid claim to the properties by virtue of the public documents and Torrens titles issued in its favor.
• Possession: Respondent belied petitioners' claim of actual possession, asserting it employed Santos Arevalo as caretaker, supported by a notarized Receipt and Quitclaim signed by Arevalo.

• Propriety of Injunction: Whether the trial court erred in granting the writ of preliminary injunction.
• Prescription: Whether petitioners' action to impugn respondent's titles has prescribed.

• Propriety of Injunction: The writ was improperly issued. To be entitled to an injunctive writ, the applicant must establish a clear and unmistakable right in esse. Petitioners relied on bare assertions of co-ownership and simulated deeds, which are insufficient to overcome the presumption of validity enjoyed by respondent's notarized deeds of conveyance and Torrens titles. Where the right is doubtful or disputed, injunction is improper. Furthermore, the trial court's basis—doubting the acquisition—prejudged the main case and reversed the burden of proof. Actual possession claimed by petitioners bears no legal consequence because the execution of the notarized deeds is deemed equivalent to delivery under Article 1498 of the Civil Code.
• Prescription: The CA's ruling that the action had prescribed was precipitate. The parties had yet to prove their allegations, and the trial court had yet to receive evidence. There was nothing on record to conclusively support the prescription finding.

• Requisites for Preliminary Injunction — The applicant must establish: (1) a right in esse or a clear and unmistakable right to be protected; (2) a violation of that right; (3) an urgent and permanent act and urgent necessity for the writ to prevent serious damage. Applied: Petitioners failed the first requisite because their bare assertions could not overcome the presumptions favoring respondent's notarized documents and Torrens titles.
• Presumption of Validity of Notarized Documents — A document acknowledged before a notary public enjoys the presumption of regularity and is prima facie evidence of the facts stated therein. To overcome this, clear and convincing evidence is required. Applied: Petitioners' bare allegations were insufficient to overturn the presumption favoring the deeds of sale.
• Presumption of Validity of Torrens Titles — Titles registered under the Torrens system are generally conclusive evidence of ownership, and a strong presumption exists that they are regularly issued and valid. Applied: Respondent's titles carried this presumption, which petitioners failed to rebut at the injunction stage.
• Constructive Delivery via Public Instrument — Under Article 1498 of the Civil Code, the execution of a sale through a public instrument is equivalent to delivery of the object of the contract, unless the contrary appears or can be inferred. Applied: Possession was deemed transferred to respondent by virtue of the notarized deeds, rendering petitioners' claim of actual physical possession legally inconsequential.

• "Where the complainant's right or title is doubtful or disputed, injunction is not proper. The possibility of irreparable damage without proof of actual existing right is not a ground for an injunction."
• "Possession and ownership are two different legal concepts. Just as possession is not a definite proof of ownership, neither is non-possession inconsistent with ownership."

• First Global Realty and Development Corporation vs. San Agustin — Cited for the purpose of a preliminary injunction: to preserve the status quo until the merits can be heard fully.
• Tayag vs. Lacson — Followed for the three requisites to be entitled to an injunctive writ.
• Heirs of Joaquin Asuncion vs. Gervasio, Jr. — Followed for the rule that injunction is improper where the right is doubtful or disputed.
• Ceballos vs. Mercado — Followed for the presumption of regularity of notarized documents.
• Searth Commodities Corp. vs. Court of Appeals — Followed for the rule that courts should avoid issuing an injunction that would effectively dispose of the main case without trial.
• Sabio vs. International Corporate Bank, Inc. — Followed for the doctrine that execution of a public instrument is equivalent to delivery.

• Section 3, Rule 58 of the Rules of Court — Grounds for issuance of preliminary injunction. Applied to determine the requisites petitioners had to meet.
• Article 1498 of the Civil Code — "When the sale is made through a public instrument, the execution thereof shall be equivalent to the delivery of the object of the contract..." Applied to establish that respondent was in constructive possession by virtue of the notarized deeds, negating the legal effect of petitioners' physical possession.

Puno (Chairman), Callejo, Sr., Tinga, and Chico-Nazario