PROPERTY POINT: CONSULTA

A certain Register of Deeds denied the registration of the Deed of Absolute Sale executed by a corporation sole on the ground that “Court Approval is necessary since the Vendor being a corporation sole pursuant to Section 113 of Batas Pambansa Blg. 68, the Corporation Code of the Philippines.”

Pursuant to Section 117 of Presidential Decree No. 1529, otherwise known as the Property Registration Decree, we elevate the matter to Land Registration Authority (LRA) by way of consulta.


BASIS OF CONSULTA:

Section 117 of the Property Registration Decree reads –

Section 117. Procedure. When the Register of Deeds is in doubt with regard to the proper step to be taken or memorandum to be made in pursuance of any deed, mortgage or other instrument presented to him for registration, or where any party in interest does not agree with the action taken by the Register of Deeds with reference to any such instrument, the question shall be submitted to the Commissioner of Land Registration by the Register of Deeds, or by the party in interest thru the Register of Deeds. Where the instrument is denied registration, the Register of Deeds shall notify the interested party in writing, setting forth the defects of the instrument or legal grounds relied upon, and advising him that if he is not agreeable to such ruling, he may, without withdrawing the documents from the Registry, elevate the matter by consulta within five days from receipt of notice of the denial of registration to the Commissioner of Land Registration.

The Register of Deeds shall make a memorandum of the pending consulta on the certificate of title which shall be cancelled motu proprio by the Register of Deeds after final resolution or decision thereof, or before resolution, if withdrawn by petitioner.

The Commissioner of Land Registration, considering the consulta and the records certified to him after notice to the parties and hearing, shall enter an order prescribing the step to be taken or memorandum to be made. His resolution or ruling in consultas shall be conclusive and binding upon all Registers of Deeds, provided, that the party in interest who disagrees with the final resolution, ruling or order of the Commissioner relative to consultas may appeal to the Court of Appeals within the period and in manner provided in Republic Act No. 5434.

STATEMENT OF MATERIAL DATES:

Include a statement that the corporation sole has until a particular date (it should be within five days)to elevate the matter by consulta to the Land Registration Authority.


STATEMENT OF FACTS:


ISSUE:

Whether or not the Deed of Absolute Sale is registrable, despite the absence of a Court Approval allowing the corporation sole, to sell the Property?

DISCUSSION:

1. Section 113 of the Corporation Code of the Philippines was the basis for the denial of registration by the Register of Deeds. Section 113 is hereto quoted in full, as follows:

“Acquisition and alienation of property. - Any corporation sole may purchase and hold real estate and personal property for its church, charitable, benevolent or educational purposes, and may receive bequests or gifts for such purposes. Such corporation may sell or mortgage real property held by it by obtaining an order for that purpose from the Court of First Instance of the province where the property is situated upon proof made to the satisfaction of the court that notice of the application for leave to sell or mortgage has been given by publication or otherwise in such manner and for such time as said court may have directed, and that it is to the interest of the corporation that leave to sell or mortgage should be granted. The application for leave to sell or mortgage must be made by petition, duly verified, by the chief archbishop, bishop, priest, minister, rabbi or presiding elder acting as corporation sole, and may be opposed by any member of the religious denomination, sect or church represented by the corporation sole: Provided, That in cases where the rules, regulations and discipline of the religious denomination, sect or church, religious society or order concerned represented by such corporation sole regulate the method of acquiring, holding, selling and mortgaging real estate and personal property, such rules, regulations and discipline shall control, and the intervention of the courts shall not be necessary. (portions in bold are added for emphasis)

2. Basing only on the first paragraph of the above – quoted Section 113 of the Corporation Code, the Register of Deeds is correct in his denial. However, he erroneously missed the proviso on the same Section 113 that states “Provided, That in cases where the rules, regulations and discipline of the religious denomination, sect or church, religious society or order concerned represented by such corporation sole regulate the method of acquiring, holding, selling and mortgaging real estate and personal property, such rules, regulations and discipline shall control, and the intervention of the courts shall not be necessary.”

3. A corporation sole was organized and registered with the Securities and Exchange Commission, under the following provision of the Corporation Code of the Philippines (“Corporation Code”):

“SECTION 110. Corporation Sole. — For the purpose of administering and managing, as trustee, the affairs, property and temporalities of any religious denomination, sect or church, a corporation sole may be formed by the chief archbishop, bishop, priest, minister, rabbi or other presiding elder of such religious denomination, sect or church.”

6. For the purpose of this consulta, it is instructive to note that corporation sole described in Section 113 of the Corporation Code, may purchase, hold and dispose of real estate and personal property for its church, charitable, benevolent or educational purposes. Moreover, corporation sole has rules, regulations and discipline which regulates the method of acquiring, holding, selling and mortgaging real estate and personal property, such that the existence of said rules, regulations and discipline, the intervention of the courts shall not be necessary as said rules, regulations and discipline would control.

10. Since corporation sole rules, regulations and discipline regulate the method of selling real estate property, such rules, regulations and discipline shall control, and the intervention of the courts shall not be necessary. Hence, the Deed of Absolute Sale is registrable, despite the absence of a Court Approval allowing LDS, being a corporation sole, to sell the Property.


PRAYER:

We therefore request that:

1. The Land Registration Authority directs the Register of Deeds to register the Deed of Absolute Sale between the parties--

2. The Register of Deeds be further directed to cause the cancellation of Transfer Certificate of Title No. and the issuance of a new title covering the ---square meters subject of the sale in favor of the buyer.

Based on LRA CIRCULAR No. 04-2005 otherwise known as the Supplement to Rules and Procedure on Consulta, it is directed that all Consulta shall be filed directly with the Register of Deeds concerned who shall endorse the same to the LRA after payment of the required fees. No consulta shall be entertained by LRA without the required endorsement from the Register of Deeds.