This article is written for informational purposes only and does not constitute legal advice. Where real property and succession are involved, always consult a Philippine lawyer who can examine the precise facts and documents of your case.
I. Overview
When a seller of registered land in the Philippines dies after signing a Deed of Absolute Sale (DoAS) but before the buyer registers the deed, three bodies of law converge:
- Civil Code – on contracts (Arts. 1311 et seq.), sales (Arts. 1458 et seq.), and succession (Arts. 777 et seq.).
- Property Registration Decree (Pres. Decree 1529) – on Torrens‐title registration.
- National Internal Revenue Code (NIRC) – on estate tax, capital-gains tax (CGT) or creditable withholding tax (CWT), and documentary-stamp tax (DST).
Understanding how these interact—in both doctrine and procedure—determines whether the buyer can still secure a Transfer Certificate of Title (TCT) in his or her name.
II. Core Doctrines
| Issue | Governing rule | Practical effect |
|---|---|---|
| Perfection vs. consummation of sale | A sale is perfected upon meeting of the minds (Art. 1475), but ownership passes only upon delivery (traditio) (Art. 1497). | Where the parties sign and notarize a DoAS and the owner hands over the owner’s duplicate TCT or otherwise delivers the property, ownership has already passed—even if not yet registered. |
| Relativity of contracts & transmission to heirs | Contracts bind the heirs of the contracting parties (Art. 1311 ¶1), provided the obligation is transmissible by nature and the heir’s liability is limited to the value of the property inherited. | The seller’s death does not void the sale; the estate/heirs step into the decedent’s shoes. |
| Effect of non-registration | A deed that is not annotated on the TCT does not bind third persons (Sec. 53, PD 1529), though it remains valid between the parties. | Until annotation, an heir could theoretically resell the same land; the buyer must race to register (Art. 1544). |
| Succession opens at death | Ownership of the decedent’s properties, including the unpaid/undelivered balance of a contract, passes to the estate at the instant of death (Art. 777). | Registration now requires dealing with the estate (through an executor, administrator, or heirs in extra-judicial settlement). |
III. Two Common Scenarios
A. Deed of Sale Already Signed, Seller Dies Before Registration
Validity – The sale remains valid; title has ideally transferred by delivery.
Registration route
Secure the following from the heirs/estate: Owner’s duplicate TCT Signed Affidavit of Extrajudicial Settlement with Confirmation of Sale (or a court-approved project of partition in testate/intestate proceedings) Tax Identification Numbers (TINs).
BIR clearances
- Estate Tax – Due within one year from death (Sec. 90, NIRC). Failure to pay blocks issuance of the Certificate Authorizing Registration (CAR).
- Capital-Gains Tax / Creditable-Withholding Tax – Still due on the sale.
- Documentary-Stamp Tax – 1.5 % of the higher between the consideration and zonal value.
Pay Local Transfer Tax at the Treasurer’s office (0.50–0.75 %).
Present the DoAS, CAR, tax receipts, RPT clearance, and duplicate TCT to the Register of Deeds (RD).
Obstructive heirs – If an heir withholds the duplicate TCT or refuses to sign, the buyer may file:
- Specific performance / reconveyance to compel formalities;
- Petition for issuance of a new owner’s duplicate under Sec. 109, PD 1529;
- Annotation of an adverse claim (Sec. 70, PD 1529) within 30 days of learning of the refusal, preserving priority for 30 days.
Double sale danger – Under Art. 1544, the buyer who first registers in good faith wins; mere prior possession or execution of the deed does not prevail over subsequent registration by another.
B. Seller Dies Before Executing a Notarized Deed
Here, only a verbal agreement, a receipt, or a private contract exists.
- Is there a perfected sale? – Offer and acceptance must be provable (Art. 1475).
- Specific-performance suit – The buyer can sue the estate/heirs to compel the execution of a public instrument if the contract is proven.
- Probate or settlement first – Courts typically require the heirs to be substituted in an ongoing suit or to complete settlement before disposition.
- Risk allocation – Because the deed is indispensable for RD registration, the buyer bears heavier evidentiary and procedural burdens.
IV. Tax Matrix
| Stage | Tax/Fee | Key rate/base | Who files/pays |
|---|---|---|---|
| Estate settlement | Estate Tax | Graduated (6 % of net estate since TRAIN) | Executor, admin, or heirs |
| Sale | CGT (ordinary asset = CWT) | 6 % of the higher of zonal value or gross selling price | Seller’s estate (practically, the buyer shoulders) |
| DST | 1.5 % of same base | Buyer | |
| Local | Transfer Tax | 0.5 – 0.75 % of same base | Buyer |
| Registration | RD fees | Per RD schedule | Buyer |
The CAR will not be issued unless all national taxes above are paid.
V. Jurisprudence Highlights
| Case | G.R. No. / Date | Doctrine |
|---|---|---|
| Spouses Abalos v. Heirs of Gomez | 158989, 16 Jun 2004 | A duly signed deed plus delivery transfers ownership; heirs of unpaid seller cannot later rescind without returning the price. |
| San Miguel Properties v. Spouses Duenas | 195163, 8 July 2015 | Buyer may compel registration despite refusal of the registered owner to surrender the duplicate TCT; court may order RD to cancel and issue a new duplicate. |
| Heirs of Malate v. Gamboa | 170139, 22 Jan 2014 | Non-registration does not invalidate the sale but exposes it to the risk of a later buyer who first registers in good faith. |
| De Guzman v. CA | 104625, 6 Nov 1992 | Estates are liable on the decedent’s contracts to the extent of property inherited; heirs’ consent not required to honor perfected contracts. |
VI. Step-by-Step Guide for Buyers
Collect documents: notarized DoAS, IDs/TINs of parties, tax clearances, owner’s duplicate TCT.
Open estate file (if none):
- Testate – file the will for probate and have executor appointed.
- Intestate – heirs may execute an Extrajudicial Settlement (Rule 74, Sec. 1, Rules of Court) if: (a) no will, (b) no debts, or (c) debts fully paid.
Pay estate taxes within one year from seller’s death (or avail of amnesty, if any).
Have heirs confirm the sale in the settlement instrument.
Secure BIR CAR(s) – One covers the estate, another covers the sale.
Settle local taxes and secure real-property-tax clearance.
Submit to RD: DoAS, CAR, tax receipts, EJS/Probate Order, IDs, owner’s duplicate, and RD fees.
Follow up until the new TCT naming the buyer is released.
VII. Frequently Encountered Pitfalls
- Unsigned or unnotarized contracts – Cannot be registered; courts may treat them as equitable claims only.
- Estate tax ignored – RD/BIR will refuse transfer. Penalties and interest accrue at 6 % p.a. (compounded annually).
- Heirs in bad faith resell the land – Record an adverse claim quickly; sue for reconveyance and damages.
- Spouses’ signatures absent – If the land is conjugal or community property, a sale without the spouse’s written consent (Art. 96, 124, FC) is voidable; rectify via ratification by the surviving spouse and heirs.
- Agricultural lands – Additional DAR clearance (DAR A.O. 1-2024) needed before RD can act.
VIII. Best Practices & Practical Tips
- Always secure the original owner’s duplicate TCT at closing; its physical control is strategic leverage.
- Annotate ASAP – Even a provisional Notice of Adverse Claim protects your priority.
- Keep receipts of estate-tax and capital-gains-tax payments; they are frequently lost and costly to reconstitute.
- Anticipate estate issues by requiring the seller to produce a medical certificate of capacity and valid IDs dated near execution to forestall fraud claims.
- Consider escrow of a portion of the price to fund estate taxes and heirs’ documentary work.
IX. Conclusion
The death of a seller does not extinguish a perfected and consummated sale of registered Philippine land—but it does divert the buyer into the technical byways of estate settlement, tax clearance, and Torrens procedures. With a notarized deed, proof of delivery, and diligence in paying both estate and transfer taxes, the buyer can compel the heirs or the probate court to cooperate in registration. Delay, indifference, or ignorance, however, can expose the buyer to double sales, prescription of actions, and mounting fiscal penalties. In transactions involving elderly or infirm owners, therefore, parties should build in safeguards—escrow, adverse-claim annotation, or immediate registration—before fate closes the seller’s signature for good.