Flashcards Studio

Ramon owns a parcel of land. He privately sells it to Liza through a private deed (no public instrument) and Liza does not register or take possession. Subsequently, Ramon sells the same parcel to Kai through another private deed (also without a public instrument or registration). A bank, Bank X, holds a mortgage on Ramon’s parcel and a third party encroacher also claims an interest in the land. (a) Classify whether the rule that transfers of immovable property must be effected by a public instrument to transfer ownership and bind third parties is mandatory or prohibitory under Art. 5. (b) Explain the effect of the private-deed transfers on (i) the validity of the transfer between Ramon and Liza, and (ii) Liza’s rights against Bank X and against other third-party claimants in the land. (c) If Liza later acquires a private deed from Ramon to transfer the same parcel to Kai, what would be Kai’s rights and why, in light of the mandatory/prohibitory doctrine?