What Precautions Should Buyers of Titled Land Take to Verify the Title and the Property’s Metes and Bounds?
Purchasing titled land is often perceived as a secure investment. Many buyers assume that because a property is covered by a Transfer Certificate of Title (TCT) or Original Certificate of Title (OCT), they are automatically protected from legal disputes. Unfortunately, this assumption is not always correct.
Even titled properties may be affected by boundary disputes, overlapping claims, fraudulent transactions, inaccurate technical descriptions, or defects in the chain of title. A prudent buyer should therefore conduct thorough due diligence before purchasing any real property.
The Supreme Court, in Domingo Realty, Inc. v. Court of Appeals, emphasized that prospective buyers of titled land must exercise the diligence of a reasonably prudent person by undertaking measures to ensure both the legality of the title and the accuracy of the property’s metes and bounds.
Why Due Diligence Is Essential
A certificate of title is generally considered conclusive evidence of ownership. However, while the title may appear valid on its face, problems may still exist regarding the property’s actual boundaries, technical description, previous transactions, or conflicting claims by neighboring landowners.
Failure to verify these matters may expose a buyer to expensive litigation, delays in development, or even the loss of the property.
Precautions Every Buyer Should Take
In the aforementioned case, the Supreme Court outlined six precautionary measures that a buyer should undertake before purchasing titled land:
1. Verify the origin, history, authenticity, and validity of the title with the Office of the Register of Deeds and the Land Registration Authority.
The buyer should obtain a Certified True Copy of the title from the Register of Deeds and verify its authenticity with the Land Registration Authority (LRA). This helps confirm that the title is genuine, remains valid, and has not been cancelled, superseded, or fraudulently altered.
It is likewise advisable to examine the title for any annotations, such as mortgages, notices of lis pendens, adverse claims, easements, or other encumbrances that may affect ownership or use of the property.
2. Engage the services of a competent and reliable geodetic engineer to verify the boundary, metes, and bounds of the lot subject of said title based on the technical description in the said title and the approved survey plan in the Land Management Bureau.
One of the most important yet often overlooked steps is hiring a competent and reliable geodetic engineer.
The geodetic engineer should verify the property’s boundaries, metes and bounds, and technical description by comparing the certificate of title with the approved survey plan on file with the Land Management Bureau (LMB). This process helps determine whether the property on the ground actually corresponds to the property described in the title.
This step is particularly important because discrepancies between the title and the actual property may result in boundary conflicts or overlapping claims.
3. Conduct an actual ocular inspection of the lot.
A physical inspection of the property allows the buyer to determine its actual condition and occupancy.
During the inspection, the buyer should verify whether:
- the property is occupied;
- there are existing improvements or structures;
- there are visible boundary markers;
- the property corresponds to the technical description in the title; and
- there are any apparent encroachments or boundary issues.
An ocular inspection often reveals facts that cannot be discovered merely by examining documentary records.
4. Inquire from the owners and possessors of adjoining lots with respect to the true and legal ownership of the lot in question
The Supreme Court likewise advises buyers to speak with the owners and possessors of neighboring properties.
Adjacent landowners may provide valuable information regarding:
- boundary disputes;
- competing ownership claims;
- long-standing possession;
- easements affecting the property; or
- other issues that may not appear in public records.
These inquiries may uncover potential legal problems before the purchase is completed.
5. Put up signs that said lot is being purchased, leased, or encumbered;
Where appropriate, buyers may place signs on the property indicating that it is being purchased, leased, or otherwise encumbered.
Doing so serves as notice to the public and may encourage persons claiming an interest in the property to come forward before the transaction is finalized, thereby reducing the risk of future disputes.
6. Undertake such other measures to make the general public aware that said lot will be subject to alienation, lease, or encumbrance by the parties.
The Supreme Court also encourages buyers to undertake any other reasonable measures that would make the public aware that the property will be the subject of a sale, lease, or encumbrance.
Depending on the circumstances, these measures may include:
- verifying the seller’s authority to sell;
- confirming that real property taxes are updated;
- reviewing prior deeds and supporting documents;
- checking whether the property is involved in pending litigation; and
- consulting a real estate lawyer before signing any agreement.
These precautionary measures may require additional time and expense, but they are far less costly than becoming involved in protracted property litigation. Exercising the diligence of a reasonably prudent buyer is the best protection against future disputes and helps ensure that the property being purchased is indeed the property described in the title.