TL;DR
The Supreme Court affirmed that Spouses Ko validly redeemed their property from a tax sale, even though they weren’t the registered owners. The Court clarified that under the Local Government Code, redemption is not strictly limited to registered owners but extends to those with ‘legal interest.’ Spouses Ko’s unnotarized Deed of Absolute Sale and long-term possession sufficiently demonstrated their legal interest, entitling them to redeem the property and preventing the petitioner from consolidating ownership. This ruling underscores that actual ownership and vested interests, even without formal registration, are recognized in redemption scenarios.
Beyond Titles: When Possession and Purchase Secure Redemption Rights
This case, Davidson Go v. Spouses Henry and Janet Ko, revolves around a dispute over the redemption of a property sold due to tax delinquency. Davidson Go, the petitioner, purchased the property at a tax auction when the registered owner, Lexus Development, Inc., failed to pay real estate taxes. Spouses Ko, the respondents, claimed to have validly redeemed the property within the one-year period. The central legal question is whether Spouses Ko, who were not the registered owners but had purchased the property from Lexus and possessed it for years, had the right to redeem the property under the Local Government Code (RA 7160). This decision clarifies the scope of redemption rights, particularly for individuals with unregistered ownership but demonstrable legal interest in a property subject to tax sale.
The narrative unfolds with Davidson Go initiating a land registration case to consolidate title over the property he acquired at the tax sale. Spouses Ko opposed, asserting their right to redeem. The Regional Trial Court (RTC) initially sided with Go, reasoning that Spouses Ko failed to prove authorization from Lexus, the registered owner, to redeem, and their Deed of Absolute Sale was undated and unnotarized, thus insufficient proof of ownership. However, the Court of Appeals (CA) reversed the RTC, recognizing the validity of the unnotarized Deed of Absolute Sale between Janet Ko and Lexus and Spouses Ko’s long-term possession as establishing sufficient legal interest for redemption. The Supreme Court, in this Decision penned by Justice Inting, ultimately affirmed the CA’s ruling, denying Go’s petition.
The Supreme Court anchored its decision on Section 261 of RA 7160, which grants the right to redeem to “the owner of the delinquent real property or person having legal interest therein.” The Court emphasized that Spouses Ko, by virtue of their Deed of Absolute Sale and continuous possession since 1996, qualified as persons with legal interest. Crucially, the Court addressed the RTC’s and Go’s concern regarding the unnotarized Deed of Absolute Sale. Citing Article 1358 of the Civil Code, the Court clarified that while a public document is required for the sale of real property, it is not essential for validity or enforceability between parties. The lack of notarization affects efficacy against third persons but does not invalidate the transfer of rights between Lexus and Janet Ko.
Furthermore, the Court highlighted the established principle of liberal construction of redemption laws. Quoting City Mayor of Quezon City v. RCBC, the decision reiterated that “redemption should be looked upon with favor and where no injury will follow, a liberal construction will be given to our redemption laws, specifically on the exercise of the right to redeem.” This principle guides courts to lean towards upholding redemption rights, especially when exercised within the statutory period and when the purpose of redemption – to recover property – is fulfilled. The Court noted that Spouses Ko paid the redemption price within the one-year period, and the City Treasurer’s Office even issued an official receipt in Lexus’s name, acknowledging the redemption.
In essence, the Supreme Court prioritized substance over form. Despite Spouses Ko’s lack of registered title and the unnotarized Deed of Sale, their established purchase and long-term possession constituted sufficient legal interest to warrant redemption. The Court refused to impose overly strict procedural requirements, especially when the City Treasurer’s Office accepted the redemption payment and no prejudice was shown to any party. This decision reinforces the principle that redemption laws should be interpreted liberally to favor the redemptioner, ensuring property owners are not unduly deprived of their land due to technicalities, particularly when they have demonstrably acted to protect their interests.
FAQs
| What was the key issue in this case? | The central issue was whether Spouses Ko, as non-registered owners with an unnotarized Deed of Sale but in possession of the property, had the legal right to redeem it from a tax sale under the Local Government Code. |
| Who has the right to redeem property sold at a tax auction according to RA 7160? | Section 261 of RA 7160 grants the right to redeem to the ‘owner of the delinquent real property or person having legal interest therein,’ or their representative, within one year from the date of sale. |
| What constitutes ‘legal interest’ in the context of redemption? | ‘Legal interest’ is interpreted broadly and is not limited to registered ownership. In this case, the Court considered an unnotarized Deed of Absolute Sale coupled with long-term possession as sufficient evidence of legal interest. |
| Is a Deed of Absolute Sale required to be notarized to be valid? | No, a Deed of Absolute Sale for real property is valid and enforceable between the parties even without notarization. Notarization is primarily for efficacy against third parties, not for validity between the buyer and seller. |
| What was the Court’s ruling on the validity of Spouses Ko’s redemption? | The Supreme Court ruled that Spouses Ko validly redeemed the property because their unnotarized Deed of Sale and long-term possession established sufficient ‘legal interest,’ and they paid the redemption price within the statutory period. |
| What is the significance of the liberal construction of redemption laws? | The liberal construction principle means courts should interpret redemption laws favorably to those seeking to redeem their property, especially when redemption is timely and no prejudice results from a less strict application of procedural rules. |
For inquiries regarding the application of this ruling to specific circumstances, please contact Atty. Gabriel Ablola through gaboogle.com or via email at connect@gaboogle.com.
Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
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