What is Adverse Claim ?

here’s an article i sent out sometime ago when a client who was selling his property found out that there was a LIS PENDENS on his Transfer Certificate of Title.  as we know, a certified true copy of both the Title and Tax Declartion  is always required  when verifying authenticity of a Title.  the LIS PENDENS was eventually removed ….

Adverse Claim

Adverse claim. Whoever claims any part or interest in registered land adverse to the registered owner, arising subsequent to the date of the original registration, may, if no other provision is made in this Decree for registering the same, make a statement in writing setting forth fully his alleged right or interest, and how or under whom acquired, a reference to the number of the certificate of title of the registered owner, the name of the registered owner, and a description of the land in which the right or interest is claimed.

The statement shall be signed and sworn to, and shall state the adverse claimant’s residence, and a place at which all notices may be served upon him. This statement shall be entitled to registration as an adverse claim on the certificate of title. The adverse claim shall be effective for a period of thirty days from the date of registration. After the lapse of said period, the annotation of adverse claim may be canceled upon filing of a verified petition therefor by the party in interest: Provided, however, that after cancellation, no second adverse claim based on the same ground shall be registered by the same claimant.

Before the lapse of thirty days aforesaid, any party in interest may file a petition in the Court of First Instance where the land is situated for the cancellation of the adverse claim, and the court shall grant a speedy hearing upon the question of the validity of such adverse claim, and shall render judgment as may be just and equitable. If the adverse claim is adjudged to be invalid, the registration thereof shall be ordered canceled. If, in any case, the court, after notice and hearing, shall find that the adverse claim thus registered was frivolous, it may fine the claimant in an amount not less than one thousand pesos nor more than five thousand pesos, in its discretion. Before the lapse of thirty days, the claimant may withdraw his adverse claim by filing with the Register of Deeds a sworn petition to that effect

ADVERSE CLAIM, PURPOSE

Purpose of annotating the adverse claim on the title of the disputed land is to apprise third persons that there is a controversy over the ownership of the land and to preserve and protect the right of the adverse claimant during the pendency of the controversy

Notice to third persons that any transaction regarding the disputed land is subject to the outcome of the dispute

Such is registered by filing a sworn statement with the RD of the province where the property is located, setting forth the basis of the claimed right together with other data pertinent thereto. The registration of an adverse claim is expressly recognized under Section 70. Where the notice of adverse claim is sufficient in law and drawn up in accordance with existing requirements, it becomes the ministerial duty of the RD to register the instrument without unnecessary delay

While the act of registration is the operative act which conveys or affects the land insofar as third persons are concerned, the subsequent sale of property covered by a certificate of title CANNOT PREVAIL OVER AN ADVERSE CLAIM, duly sworn to and annotated on the certificate of title previous the sale

Section 70 is divided into two parts—first refers to the petition of the party who claims any part or interest in the registered land, arising subsequent to the date of the original registration, for the registration of his adverse claim, which is a ministerial function of the Register of Deeds absent any defect on the face of the instrument. The second refers to the petition filed in court by a party in interest for the cancellation of the adverse claim upon showing the same is
invalid.

REGISTRATION OF ADVERSE CLAIM

A lease over a parcel of land for a 10-year period, which could not be registered because the owner’s duplicate of title wasn’t surrendered, could be registered as an adverse claim and the owner couldn’t be compelled to surrender the owner’s duplicate of the title to that adverse claim could be annotated thereon

If the adverse claim turns out to be invalid, the owner could ask for its cancellation and, if found to be frivolous or vexatious, then costs may be adjudged against the adverse claimant.

The claim of a person that she has hereditary rights in the land fraudulently registered in his sister’s name, because the land belonged to their mother whose estate is pending settlement in a special proceeding, is registrable as an adverse claim\

Where a guardianship proceeding is pending in court, it is proper to annotate on the title of the land in question the pendency of such a proceeding by means of a notice of lis pendens for the purpose of alerting anyone who might wish to buy the land that his purchase may be questioned later on. Since an adverse claim and a notice of lis pendens have the same purpose, there would be no need of maintaining the adverse claim. But a notice of levy cannot prevail over an existing adverse claim inscribed in the certificate of title

The annotation of an adverse claim is a measure designed to protect the interest of a person over a piece of real property where the registration of such interest or right isn’t otherwise provided for by PD1529, and serves as a notice and warning to third persons dealing with said property that someone is claiming an interest on the same or a better right than the registered owner thereof

FOR THE SPECIAL REMEDY OF ADVERSE CLAIM TO BE AVAILED OF, IT MUST BE SHOWN THAT THERE IS NO OTHER PROVISION IN THE LAW FOR REGISTRATION OF THE CLAIMANT’S ALLEGED RIGHT IN THE PROPERTY.

An adverse claim of ownership over a parcel of land registered under the Torrens system based on prescription and adverse possession cannot be registered as an adverse claim—no title to registered land in derogation of the title of the registered owner shall be acquired by prescription or adverse possession. Hence, the registration of such adverse claim will serve no useful purpose and cannot validly and legally affect the parcel of land in question.

REQUISITES OF AN ADVERSE CLAIM

1. The adverse claimant must state the following in writing
a. His alleged right or interest
b. How and under whom such alleged right or interest is acquired
c. The description of the land in which the riht or interest is claimed
d. The number of the certificate of title

2. The statement must be signed and sworn to before a notary public or other officer authorized to administer oath

3. The claimant should state his residence or the place to which all notices may be served upon him

REGISTRATION COURT MAY DETERMINE THE VALIDITY OF ADVERSE CLAIM

An adverse claim may be cancelled only after the claim is adjudged invalid and unmeritorious by the court while passing upon a case where the land involved is subject of the interest or right being secured by the adverse claim.

ADVERSE CLAIM NOT IPSO JURE CANCELLED AFTER 30 DAYS; HEARING NECESSARY.

Sajonas v. CA
Register of Deeds cannot unilaterally cancel the adverse claim. There must be a court hearing for the purpose. The reason for this is to afford the adverse claimant an opportunity to be heard, providing a venue where the propriety of his claimed interest can be established or revoked, all for the purpose of determining at least the existence of any encumbrance on the title arising from such adverse claim.

PURCHASER NOT BOUND BY ANY LIEN NOT ENTERED IN THE CERTIFICATE OF TITLE FORECLOSURE SALE RETROACTS TO REGISTRATION OF MORTGAGE

The settled doctrine is that the effects of a foreclosure sale retroact to the date of registration of the mortgage.

Hence, if the adverse claim is registered only after the annotation of the mortgage at the back of the certificate of title, the adverse claim could not effect the rights of the mortgagee; and the fact that the foreclosure of the mortgage and the consequent public auction sale have been effected long after the annotation of the adverse claim is of no moment, because the foreclosure sale retroacts to the date of registration of the mortgage.

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