Torrens system does not create title
In Tenio-Obsequio v. Court of Appeals, it was explained that the purpose of the Torrens system and its legal implications to third persons dealing with registered land are as follows:
The main purpose of the Torrens system is to avoid possible conflicts of title to real estate and to facilitate transactions relative thereto by giving the public the right to rely upon the face of a Torrens certificate of title and to dispense with the need of inquiring further, except when the party concerned has actual knowledge of facts and circumstances that should impel a reasonably cautious man to make such further inquiry. Where innocent third persons, relying on the correctness of the certificate of title thus issued, acquire rights over the property, the court cannot disregard such rights and order the total cancellation of the certificate. The effect of such an outright cancellation would be to impair public confidence in the certificate of title, for everyone dealing with property registered under the Torrens system would have to inquire in every instance as to whether the title has been regularly or irregularly issued by the court. Every person dealing with registered land may safely rely on the correctness of the certificate of title issued therefor and the law will in no way oblige him to go beyond the certificate to determine the condition of the property.[2]
The Torrens system was adopted in the Philippines because it was believed to be the most effective measure to guarantee the integrity of land titles and to protect their indefeasibility once the claim of ownership is established and recognized. If a person purchases apiece of land on the assurance that the seller's title thereto is valid, he should not run the risk of being told later that his acquisition was ineffectual after all. This would not only be unfair to him. What is worse is that if this were permitted, public confidence in the system would be eroded and land transactions would have to be attended by complicated and not necessarily conclusive investigations and proof of ownership. The further consequence would be that land conflicts could be even more numerous and complex than they are now and possibly also more abrasive, if not even violent. The Government, recognizing the worthy purposes of the Torrens system, should be the first to accept the validity of titles issued thereunder once the conditions laid down by the law are satisfied.
The Torrens system was intended to guarantee the integrity and collusiveness of the certificate of registration, but the system cannot be used for the perpetration of fraud against the real owner of the registered land. The system merely confirms ownership and does not create it. It cannot be used to divest lawful owners of their title for the purpose of transferring it to another one who has not acquired it by any of the modes allowed or recognized by law. Thus, the Torrens system cannot be used to protect a usurper from the true owner or to shield the commission of fraud or to enrich oneself at the expense of another.[3]
[1] Peralta v. Heirs of Abalon, G.R. No. 183448, June 30, 2014, citing Pioneer Insurance & Surety Corporation v. Heirs of Vicente Coronado, 62 Phil. 573 (2009).
[2] G.R. No. 107967, March 1, 1994.
[3] Supra note 1.
