Sale of Co‑Owned Land Not in the Owner’s Name under Philippine Law
(A practitioner‑oriented explainer as of 21 April 2025)
1. Conceptual Framework
| Key Concept | Governing Text |
|---|---|
| Co‑ownership | Civil Code, Arts. 484‑501 |
| Ownership & Disposition | Civil Code, Arts. 428‑440; Art. 493 (each co‑owner may alienate his ideal share) |
| Void & Voidable Sales | Arts. 1318‑1409 (consent, object, cause) |
| Torrens System | Property Registration Decree (PD 1529) |
| Estate Proceedings | Rule 74, Rules of Court; NIRC (estate tax) |
2. Why the Title Matters
Under the Torrens system, the registered owner named on the Transfer Certificate of Title (TCT) enjoys the indefeasible right to alienate the property. Nemo dat quod non habet—one cannot give what one does not have.
- If the seller’s name does not yet appear on the TCT (e.g., the land is still in the name of a deceased parent), the seller has no registrable legal title to transfer.
- Yet the Civil Code distinguishes title from ownership: heirs and co‑owners are owners by operation of law from the moment of death (Art. 777), even before their names reach the title.
The clash between civil ownership and registered title is the root of most disputes.
3. Co‑Owner’s Power to Sell
| Scenario | Legal Effect |
|---|---|
| Sale of the seller’s undivided ideal share (Art. 493) | Valid between parties; buyer becomes a new co‑owner pro‑indiviso. Registration possible once the title is updated. |
| Sale of a specific portion without the others’ consent | Void ab initio with respect to the specific part; may be enforced only if the property is later partitioned and the portion adjudicated to the seller. |
| Sale of the entire property without unanimity | Void as to the shares of non‑consenting co‑owners. The deed transfers only the seller’s undivided share. |
Practical tip: Buyers often insist on a Deed of Adjudication with Sale (heirs) or a Co‑Owners’ Extrajudicial Settlement with Sale to show unanimous consent.
4. Heirs Selling Land Still in the Decedent’s Name
Settle the estate first
- Extrajudicial settlement (Rule 74) if: (a) no will, (b) no debts, (c) all heirs of age or duly represented.
- Publish the settlement in a newspaper once a week for three weeks.
- File an estate tax return and secure a Certificate Authorizing Registration (CAR) from the BIR.
Register the settlement
- Annotate on the TCT; the Register of Deeds (RD) issues new titles in heirs’ names.
Execute the Deed of Sale
- Only after the heirs appear on the new TCT can the buyer obtain a registrable conveyance.
Shortcut used in practice: A single document titled “Deed of Extrajudicial Settlement with Absolute Sale” both settles the estate and sells to the buyer. This is accepted by RDs if all documentary taxes are paid.
5. Unregistered (Original Certificate) vs. Registered Land
| Item | Registered Land (Torrens) | Unregistered Land (Old Code) |
|---|---|---|
| Public record | TCT/OCT; PD 1529 | Deeds Registry; Act 3344 |
| Effect of registration | Creates/ conveys title | Merely evidence against third parties |
| Buyer in good faith | Protected if vendor appears on TCT | Must trace ownership back to a lawful source; more due diligence needed |
6. Double Sale Problems (Art. 1544)
If the co‑owner who is not on the title sells first and then another co‑owner later registers a second sale:
- Movable vs. immovable—immovables require registration.
- Priority rules:
- First in registration in good faith;
- If neither deed registered, first in possession;
- If possession equal, first in date of deed.
Because the first seller has no title to register, the second buyer (if in good faith) usually wins by registering.
7. Case Law Highlights
| Case | G.R. No. / Date | Doctrine |
|---|---|---|
| Spouses Abalos v. Heirs of Gomez | 932 L‑445, 19 June 1992 | Sale by one co‑owner binds only his ideal share; buyer becomes co‑owner. |
| Heirs of Malate v. Gamboa | 219 987, 22 Nov 2017 | Extrajudicial settlement + sale upheld; publication cures technical defects. |
| Caro v. CA | 124 687, 13 Mar 1998 | Unregistered deed cannot defeat later TCT issued to another buyer in good faith. |
| Urieta v. CA | 116 717, 28 Sept 2010 | Co‑owner may compel others to execute documents to perfect buyer’s title after partition. |
8. Tax & Documentary Requirements
| Document | Where Obtained | Usual Deadline |
|---|---|---|
| Capital Gains Tax Return (or Creditable WHT if seller is corp.) | BIR RDO where property is | 30 days from notarization |
| Documentary Stamp Tax Return | BIR | Same as above |
| CAR (green copy) | BIR | Pre‑requisite for RD registration |
| Transfer Tax Receipt | City/Municipal Treasurer | 60 days (LGU‑specific) |
| RD fees (Entry, Registration, TCT issuance) | Register of Deeds | Upon presentation |
All co‑owners—or their attorneys‑in‑fact—must sign the returns. BIR will not issue a CAR if any heir/co‑owner lacks a Taxpayer Identification Number (TIN).
9. Remedies of Aggrieved Co‑Owners
- Action for Annulment of Deed / Reconveyance – 4 years (voidable) or imprescriptible (void).
- Acción reivindicatoria – to recover possession; 30 years if ownership.
- Partition under Rule 69 – any co‑owner may sue to terminate co‑ownership; court may award damages.
- Criminal liability – Estafa under Art. 315(2)(a) if seller deceived buyer by misrepresenting authority.
10. Checklist for Buyers
- Verify the chain of title back to an Owner’s Duplicate TCT/OCT.
- Demand a Special Power of Attorney if seller signs for other co‑owners.
- Require a recent certification of no encumbrance (RD) and tax clearance (LGU).
- For hereditary properties: see death certificates, certified list of heirs, and published settlement.
- Insist on simultaneous payment of taxes and registration to avoid a floating deed.
11. Conclusion
Selling or buying co‑owned Philippine land not yet registered in the seller’s name is not automatically void, but it is fraught with pitfalls. The Civil Code allows disposition of an undivided share, yet the Torrens system protects only what the title shows. Proper estate settlement, unanimous consent (or at least full disclosure of dissent), and diligent compliance with tax and registration requirements transform a risky transaction into a secure one.
This article synthesizes statutory provisions, Supreme Court jurisprudence, and prevailing practice as of 21 April 2025. It is for educational purposes and does not constitute legal advice. For specific situations, consult Philippine counsel.