G.R. No. 48173 ; January 30, 1943
GENARO F. MENDOZA, ET AL., petitioners, vs. EPIFANIA ROSEL, ET AL., respondents.

FACTS

Genaro F. Mendoza and Anuciacion E. de Mendoza (now deceased) were sued by respondents Epifania Rosel and Paulino Nator in the Court of First Instance of Cebu for an injunction to prevent the petitioners from closing an easement of right of way appurtenant to the respondents’ lots. Both the trial court and the Court of Appeals ruled in favor of the respondents. The respondents’ lots are part of a larger parcel of city land originally owned by the heirs of Pedro Rodriguez. This large parcel was subdivided into small lots and sold to various persons, including the respondents. In subdividing the land, the original owners opened a three-meter-wide alley running across it, dividing it into two equal areas. This alley is the only means of access from the small lots on the western half of the larger parcel (including the respondents’ lots) to General Junquera Street, the only available street. When the title to the larger land was confirmed in favor of the heirs of Pedro Rodriguez, the court treated the alley as two separate lots (one 45 by 3 meters and the other 40 by 3 meters) and ordered the issuance of corresponding certificates of title for them. The petitioners claim that since their transfer certificates of title for these alley lots do not mention any lien or encumbrance, they are purchasers in good faith and for value and have the right to demand payment from the respondents for the use of the alley. However, the Court of Appeals found as a fact that when the petitioners acquired the two lots constituting the alley, they knew that said lots could serve no other purpose than as an alley.

ISSUE

Whether the petitioners, as registered owners of the lots constituting the alley, can close the easement of right of way or demand payment for its use, despite their certificates of title not mentioning the easement, given the Court of Appeals’ finding that they had actual knowledge of the alley’s purpose.

RULING

The Supreme Court affirmed the judgment of the Court of Appeals. The existence of the easement of right of way was known to the petitioners, who must respect it, notwithstanding the absence of any mention of the burden or easement in their transfer certificates of title. The Court reiterated the established principle that actual notice or knowledge is as binding as registration. The petitioners’ claim of being purchasers in good faith and for value was negated by the factual finding that they knew the lots could serve no other purpose than as an alley. The Court declined to rule on whether the petitioners are entitled to indemnity from the Visayan Surety and Insurance Corporation, from whom they acquired the alley lots, as this issue was outside the scope of the case. Costs were awarded against the petitioners.
CONCURRING OPINION (Justice Ozaeta):
Justice Ozaeta concurred, stating that the heirs of Pedro Rodriguez, as original owners of the subdivided lots, were obligated under Article 567 of the Civil Code to devote the alley as a right of way for the purchasers of the surrounding lots. Consequently, the heirs had no right to encumber, sell, or dispose of the alley. Therefore, the successive transfers of the alley lots down to the present petitioners were null and void. Assuming, without deciding, that the petitioners were purchasers in good faith, their potential actions against the Visayan Surety and Insurance Corporation and the heirs of Pedro Rodriguez were left open for determination in a separate suit.