Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
G.R. No L-61623
December 26, 1984
Aquino, J.:
Facts: PHHC board of directors passed Resolution No 513 awarding the
consolidated Subdivision Plan Lot 4 to spouses Mendoza at a price of
21php per sq meter. The aforementioned Subdivision plan is subject to the
approval of the Quezon City Council. The awarding to the spouses was
also subject to the approval of OEC (PHHC) Valuation Committee and
higher authorities. The city council disapproved the subdivision plan. Another plan was prepared and submitted to the city council. This plan was
approved by the city council. The revised plan reduced the area of the lot.
Another resolution was passed, which recalled all the awarded plans from
those who failed to pay the deposit or down payment. Mendoza spouses
were one of those who failed to pay. PHHC issued resolution 218, which
withdrew the awarded lot of Mendoza spouses. The lot was reawarded to
Sto. Domingo, Esteban, Pinzon, Redublo and Fernandez. The 5 awardees
deposited the DP and deeds of sale were executed in their favor. The
subdivision of lot 4 was approved by the city council and bureau of lands.
The Mendoza spouses asked for reconsiderationg of the previous award
and to cancel the reawards of the said lot.
Trial court sustained the withdrawing and awarding of lot. Apellate court
reversed the ruling.
Issue: WON there was a prefected sale between PHHC and Mendoza
spouses.
Held: No, the sale was not perfected. The sale was conditionally awarded
to the spouses subject to the approval of the city council (of the subdivision plans) and the approval of the award by the valuation committee and
higher authorities. The city council did not approve the subdivision plan.
The Mendoza spouses were made aware through mail. The spouses
should have manifested in wiriting their acceptance of the award of the
purchase pf Lot 4 just to show they were interested although the lot had
been reduced in terms of area.
Under the facts, we cannot say there was a meeting of the mind on
the renewed area of Lot 4 since the spouses did not manifest acceptance
on their part.
Romero V CA
GR No 107207 Nov 23 1995
Vitug, J,:
Facts: Romero (Petitioner) decided to put up a central warehouse in Manila.
Flores (Private Respondent) and his wife with a broker offered a parcel of
land. Romero liked the property except for the squatters therein. Flores
spouses offered to advance 50000php as payment, so they have money to
file for an ejectment case against the squatters. Romero accepted the offer.
On june 9, 1988, a "Deed of CONDITIONAL Sale" was executed. The deed
contained the following stipulations, 1) 50000 will be paid upon signing and
execution of instrument, 2) the balance shall be paid 45 days AFTER THE
REMOVAL OF SQUATTERS, 3) upon full payment vendor withou necessity of
demand shall sign and execute and deliver deed of sale. If after 60 days of
signing the VENDOR fails to remove squatters the DP shall be reimbursed. In
the event the VENDEE shall not pay the balance after 45 DAYS of written notification of removal of squatters the DP shall be forefeited."
Vendors were able to secure a judgment against said squatters but the decision was handed down beyond the 60day period. Flores sought to return the
DP but Romero refysed. Atty Apostol (rep of Romero) told Atty Yuseco (Rep of
Flores) that they will be handling the ejectment case and that all expenses will
be chargeable to the purchase price. Atty Yuseco replied asking for the declaratio of the contract null and void. Romero's refusal to accept payment promted Flores to file a case of rescission and consignation of 50000 cash.
Lower court dismissed the case and ordered Flores to eject or cause the
ejectment of the squatters and to execute the deed of sale. CA reversed the
decision and opined that the perfectio of contract was dependent on a resolutory condition.
Issue: WON there was a perfected contract of sale.
WON Private Respondent can rescind the contract.
Held: 1) Yes, the contract of sale was perfected the moment the parties had a
meeting of the minds. A perfected contract of sale may either be absolute or
conditional depending on whether the agreement is subject to any condition
on the passing of the title of the thing to be conveyed or on the obligation of a
party thereto. When ownership is retained until the fulfillment of a positive
condition the breach of the condition will simply prevent the duty to convey
title from acquiring an obligatory force. If the condition is imposed on an oblilgation of a party which is not complied with, the other party may either refuse
to proceed or waive said condition. If the condition is imposed upon the perfection of the contract itself, the failure of such condition would prevent the
juridical relation itself from coming into existence. The ejectment of the squatters is a condition the operative act of which sets into motion the period of
compliance. The so called "potestative condition" is imposed not on the birth
of the obligation but on its fulfillment, only the condition is avoided, leaving
unaffected the obligation itself.
Coronel v. CA
GR No. 103577
Oct. 7, 1996
Melo, J.:
Facts: Romulo Coronel, et. al. issued a receipt in favor of Ms. Ramona
Alcaraz for the amount of 50,000php as down payment for the purchase
of their inherited house and lot in the total amount of 1,240,00.00php. In
the receipt is was stated that:
We (the Coronels) bind ourselves to effect the transfer in our names from
our deceased father the transfer certificate of tittle immediately upon
receipt of the down payment
and:
On our presentation of the TCT already in or(sic) name, We will immediately execute the deed of absolute sale of said property and Miss Ramona
Alcaraz shall immediately pay the balance of the 1,190,000.00php
However, upon the issuance of the new title to the Coronels, they sold the
said house and lot to a third party (Mabanag) for a greater price. The
Coronels executed a Deed of Absolute Sale in favor of Mabanag and a
title was subsequently in her favor. Ramona Alcaraz seeks to nullify the
subsequent sale, but the Coronels argue in favor of its validity, saying that
the contract between them and Alcaraz was a merely an executory Contract to Sell. Thus, ownership was reserved to them and the obligation
was subject to a suspensive condition, and since Alcaraz was in America,
the same could not ripen into a Contract of Absolute Sale.
Issue: WON the agreement between the Coronels and Ramona Alcaraz
was a Contract to Sell
Held: NO. It is important to distinguish a Contract to Sell from a Conditional Contract of Sale as one of the elements to a perfected Contract of Sale
is missing from the former. In a Contract to Sell, the element of Consent or
the meeting of the minds, that is, the consent to transfer ownership in exchange for the price, is missing. The prospective seller explicitly reserves
the transfer of title to the prospective buyer until the happening of an
event, such as, for example the payment of the purchase price. In a Conditional Contract of Sale, the element of consent is present although conditioned upon the happening of an event. In a Contract to Sell, fulfillment
of the condition will not automatically result in the transfer of ownership.
Also, in a Contract to Sell, a third party which purchased the thing cannot
be considered a buyer in bad faith because ownership had not been transferred by the fulfillment of the condition, and thus the seller was within his
right to sell to a third party. The opposite can be said in the case of a Conditional Contract of Sale, where the fulfillment of the condition resulted
perfection of the buyers right to ownership. A reading of the receipt issued
by the Coronels reveals that the same is in the nature of an Conditional
Contract of Sale, there being no reservation of ownership, and the Coronels undertaking to immediately issue a Deed of Absolute Sale upon the
payment of the down payment- which had been complied with.
United Muslim and Christian Urban Poor Association v. Bryc-V Development Corp.
G.R. No. 179653
July 31, 2009
Nachura, J.:
Facts: The United Muslim and Christian Urban Poor Association (UMCUPAI) manifested its intention to purchase Lot 300 owned by Sea Foods
Corporation (SFC). SFC executed a Letter of Intent to Sell and Letter of
Intent to Purchase, providing that SFC would sell the said lot at 105php
per square meter and that UMCUPAI would endeavor to raise the necessary funds for the purchase. UMCUPAI was unable to secure a loan to allow it to purchase Lot 300, but the lot was subdivided into 3 smaller lots, of
which UMCUPAI was able to purchase one. SFC sold one of the three lots
to Bryc-V Development Corp. UMCUPAI now seeks to rescind the sale
arguing, although not explicitly, that ownership had already vested in them
as the Letters of Intent partook in the nature of a Conditional Contract of
Sale.
Issue: WON the Letters of Intention could be considered a Conditional
Contract of Sale.
Held: NO. A Letter of Intent is not a contract between the parties thereto
because it does not bind one party, with respect to the other, to give something or to render some service. An intention is a mere idea, goal, or plan.
It falls show of a definite proposal, and is a mere declaration to enter into a
contract. For a contract to be perfected, the offer must be absolute; it must
be plain and unconditional. This being the case, it cannot be considered a
Conditional Contract of Sale wherein ownership would have already vested in UMCUPAI, subject only to the fulfillment of a suspensive condition.
In Conditional Contract of Sale, a third party may be considered a buyer in
bad faith should it be shown that he was aware that when he purchased
the property in question, the same had already been the subject of a contract of sale between the another buyer and the seller, in which case his
right is defeated by the first buyers right. There being no Conditional Contract of Sale- or any contract of sale for that matter, Bryc-V cannot be held
to be a buyer in bad faith.
Tan v. Benolirao
GR. No. 153820
Oct. 16, 2009
Brion, J.:
Facts: The spouses Taningco and spouses Benolirao co-owned a parcel
of land, which they decided to alienate in favor of Mr. Delfin Tan in consideration of the sum of 1,1178,000.00 with a down-payment of 200,000php
in a document denominated as a Conditional Contract of Sale. It was
stipulated that Tan had 150 days to pay the balance, with an extendable
period of 60 days on the condition of interest. They agreed that should Mr.
Tan fail to comply with the conditions, the sellers shall have the right to
forfeit the down payment and rescind that conditional sale. The sellers undertook that once the Tan complied with the terms, they shall execute and
deliver to him the appropriate Deed of Absolute Sale. Tan paid the down
payment, but upon the death of Lamberto Benolirao (one of the sps. Benolirao) an encumbrance was annotated in the title to the lot excluding others
from the enjoyment of the same for a period of two years. Tan, unable to
comply with the conditions, argued that the period of his payment should
be extended due to the sudden encumbrance on the property. The sellers,
on the other hand, sold the property in question to a Mr. de Guzman.
De Leon v. Ong
GR. No.170405
Feb. 2, 2010
Corona, J.:
Facts: Raymundo de Leon sold three parcels of land to Benita Ong which
were mortgaged to Real Savings and Loan Association. The contract stated that that for 1.1million pesos, de Leon would sell, tansfer and convey in
a manner absolute and irrevocable the lands and the buildings, provided
that upon the payment of 415,000php Ms. Ong would assume the obligation to pay the mortgages. The amount of 415k was paid, and both parties
informed Real Savings that Ms. Ong would assume the payment of the
mortgages. Mr. de Leon also transferred the keys to the property to Ms.
Ong. During the pendency of a credit investigation by Real Savings on Ms.
Ong, she found out that the keys to the property had been changed. Apparently, the property had been sold to a certain Ms. Leona Viloria. Ong
went to Real Savings to inquire on the status of the credit investigation but
found that the titles to the properties has been released to de Leon, the
loan having been satisfied.
Held: YES. A close reading of the agreement would show that de Leon
bound himself to sell, transfer and convey in a manner absolute and irrevocable the lands in question to Ong for an in consideration of the
sum of 1.1 million pesos. Nowhere in the contract did de Leon explicitly
withhold ownership of the property. It is also important to note that de
Leon gave the keys to the property to Ong, constituting constructive delivery. The agreement, therefore, is a Contract of Sale and not a Contract to
Sell. The said contract was conditional in the sense that it did impose the
obligation to assume the mortgage on the part of Ms. Ong, but this condition was deemed fulfilled when the obligee voluntarily prevented the fulfillment of the condition, as per Article 1186.
Held: NO. A reading of the terms and conditions of the contract would
show that notwithstanding the fact that it was denominated as a Conditional Contract of Sale, it is actually a mere Contract to Sell. The sellers
undertook to deliver the Absolute Deed of Sale only upon the fulfillment of
all the terms and conditions of the contract, hence being an effective
reservation of ownership. The failure to pay the price agreed upon is not a
mere breach, casual or serious, but a situation that prevents the obligation
of the vendor to convey title from acquiring obligatory force. As the sellers
remained owners of the land as the condition had not been complied with,
they were within their right to sell the property to a third person. However,
the Court did find it improper for the sellers to garnish upon the down
payment of Mr. Tan as the encumbrance which discouraged him from
complying with the contract was not his fault.
the purchase price has already been delivered to him. In other words, the
full payment of the purchase price partakes of a suspensive condition, the
non-fulfillment of which prevents the obligation to sell from arising and
thus, ownership is retained by the prospective seller without further remedies by the prospective buyer. It does not, by itself, transfer ownership to
the buyer. In this case, Enriquez has not fully paid the purchase price of
the Lot. She does not own the Lot. Therefore, DELTA's transfer of ownership over the lot to LDB is valid.
However, LDB is bound to respect the contract to sell with Enriquez. PD
957 provides that contracts to sell registered by the seller with the Register of Deeds is binding on third persons. While this particular contract was
not registed with the Register of Deeds by DELTA, this does not prejudice
Enriquez or extinguish LDB's obligation to respect the Contract to Sell.
LDB cannot claim to be an innocent purchaser as the Lot was clearly
marked to be a part of the subdivision project of Delta. While the general
rule is that persons dealing with registered property can rely on just the
certificate of title, banks are covered by a special rule. Banks should know
that there is a risk in this dealing with this type of business because they
might be covered by existing contracts to sell
Finally, as to the effect of the dation in payment on the loan. While the lot
would have no value to the Bank if it is delivered to Enriquez, the intent of
the parties show that the dation was meant to extinguish the obligation
fully, not just to the extent of the value of the thing delivered.
Note: The Court also found that the mortgage over the Lot was void because DELTA did not acquire prior clearance from HLURB
after full payment of the purchase price. Third, petitioners retained possession of the certificate of title of the lot.
It is true that Article 1482 provides that whenever earnest money is given
in a contract of sale, it shall be considered as part of the price and proof of
the perfection of the contract. However, this article speaks of earnest
money given in a contract of sale. In this case, the earnest money was
given in a contract to sell. The earnest money forms part of the consideration only if the sale is consummated upon full payment of the purchase
price. Clearly, respondent cannot compel petitioners to transfer ownership
of the property to him.
Held: No. Under a contract to sell, the seller retains title to the thing to be
sold until the purchaser fully pays the agreed purchase price. The full
payment is a positive suspensive condition, the non-fulfillment of which is
not a breach of contract but merely an event that prevents the seller from
conveying title to the purchaser. The non-payment of the purchase price
renders the contract to sell ineffective and without force and effect. Since
the obligation of Cordero et al. did not arise because of the failure of FSMDC to fully pay the purchase price, Article 1191 of the Civil Code would
have no application.
The non-fulfillment by the FSMDC of his obligation to pay, which is a suspensive condition to the obligation of the Cordero et al. to sell and deliver
the title to the property, rendered the contract to sell ineffective and without force and effect. The parties stand as if the conditional obligation had
never existed. Article 1191 of the New Civil Code will not apply because it
presupposes an obligation already extant. There can be no rescission of
an obligation that is still non-existing, the suspensive condition not having
happened.
Dao Heng Bank, Inc., now Banco De Oro Universal Bank vs. Sps. Lilia and Reynaldo Laigo
G.R. No 173856
November 20, 2008
Carpio-Morales, J.
Facts: Spouses Laigo obtained a loan from Dao Heng Bank Inc. in the total amount of P11 million. As a security 3 real estate mortgages were executed covering 2 parcels of land. As of 2000, the Laigos failed to pay on
time so as a remedy, they verbally agreed to cede one of the mortgaged
property to Dao Heng by way of dacion en pago (dation in payment). In
August 2000, Dao Heng, thru a letter informed the Laigos that there total
obligation amounts to P10.8 million. The Laigos took no action so their
property was foreclosed and sold at public auction.
The spouses filed for a complaint praying for the annulment of the foreclosure of the properties subject of the real estate mortgages and for them to
be allowed "to deliver by way of dacion en pago' one of the mortgaged
properties as full payment of their mortgaged obligation". They now contend that the foreclosure was illegal since there was a verbal agreement
for dacion en pago. Dao Heng, however, contends that the dacion en pago
falls under the statute of fraud therefore it is not enforceable. The Laigos
counter this by stating that the dacion is an exception since it is no longer
executory but had undergone partial performance when the titles to the
property were delivered to Dao Heng.
Issues:
(1) Whether the obligation of the spouses has been extinguished through
dacion en pago
(2) Is the foreclosure valid?
Held:
(1) No. There is no showing that the dacion en pago has been accepted
by both parties. Since there is no mutual consent, there is no dacion Dacion en pago as a mode of extinguishing an existing obligation partakes of
the nature of sale whereby property is alienated to the creditor in satisfaction of a debt in money. It is an objective novation of the obligation, hence,
common consent of the parties is required in order to extinguish the obligation. Being likened to that of a contract of sale, dacion en pago is governed by the law on sales. The partial execution of a contract of sale takes
the transaction out of the provisions of the Statute of Frauds so long as
the essential requisites of consent of the contracting parties, object and
cause of the obligation concur and are clearly established to be present. In
the case at bar, the titles to the property were delivered as a security for
the mortgage.
(2) The foreclosure is valid. It is the proper remedy for securing payment
for a mortgage. The law clearly provides that the debtor of a thing cannot
compel the creditor to receive a different one, although the latter may be
of the same value, or more valuable than that which is due (Article 1244,
New Civil Code). The obligee is entitled to demand fulfillment of the obligation or performance as stipulated. The power to decide whether to foreclose on the mortgage is the sole prerogative of the mortgagee.
Issue: Whether or not the defendant, by reason of the contract hereinbefore transcribed, was an agent of the plaintiff for the sale of his beds.
Held: No. The Supreme Court declared that the contract by and between
the plaintiff and the defendant was one of purchase and sale, and that the
obligations the breach of which is alleged as a cause of action are not imposed upon the defendant, either by agreement or by law. In order to classify a contract, due regard must be given to its essential clauses. In the
contract in question, there was the obligation on the part of the plaintiff to
supply the beds, and, on the part of the defendant, to pay their price.
These features exclude the legal conception of an agency or order to sell
whereby the mandatory or agent received the thing to sell it, and does not
pay its price, but delivers to the principal the price he obtains from the sale
of the thing to a third person, and if he does not succeed in selling it, he
returns it. By virtue of the contract between the plaintiff and the defendant,
the latter, on receiving the beds, was necessarily obliged to pay their price
within the term fixed, without any other consideration and regardless as to
whether he had or had not sold the beds.In respect to the defendant's
obligation to order by the dozen, the only one expressly imposed by the
contract, the effect of its breach would only entitle the plaintiff to disregard
the orders which the defendant might place under other conditions; but if
the plaintiff consents to fill them, he waives his right and cannot complain
for having acted thus at his own free will.
Issue: Wether or not the relationship Ker & Co and US Rubber was that of
a vendor-vendee or principal-broker? PRINCIPAL- BROKER, hence liable
under Section 194 (t) of the NIRC.
house of Ayroso, but it would have been Ayroso who would have gone to
the house of the appellant and deliver the tobacco to the
appellant. (CA)
The fact that appellant received the tobacco to be sold at P1.30 per kilo
and the proceeds to be given to complainant as soon as it was sold,
strongly negates transfer of ownership of the goods to the petitioner. The
agreement (Exhibit "A') constituted her as an agent with the obligation to
return the tobacco if the same was not sold.
CELESTINO CO VS COLLECTOR
(99 Phil 841)
Facts: Celestino Co & Company is a general co-partnership registered
under the trade name Oriental Sash Factory. From 1946 to 1951, it paid
taxes equivalent to 7% on the gross receipts under Sec. 186 of the NIRC,
which is a tax on the original sales of articles by manufacturer, producer or
importer. However, in 1952 it began to claim only 3% tax under Sec. 191,
which is a tax on sales of services. Petitioner claims that it does not manufacture ready-made doors, sash and windows for the public, but only upon
special orders from the customers, hence, it is not engaged in manufacturing, but only in sales of services.
Issue: Whether the petitioner company is engaged in manufacturing, or is
merely a special service provider.
Held: Celestino Co & Company habitually makes sash, windows and
doors, as it has represented in its stationery and advertisements to the
public. That it "manufactures" the same is practically admitted by appellant
itself. The fact that windows and doors are made by it only when customers place their orders, does not alter the nature of the establishment,
for it is obvious that it only accepted such orders as called for the employment of such material-moulding, frames, panels-as it ordinarily manufactured or was in a position habitually to manufacture.
Any builder or homeowner, with sufficient money, may order windows or
doors of the kind manufactured by this appellant. Therefore it is not true
that it serves special customers only or confines its services to them
alone. And anyone who sees, and likes, the doors ordered by Don Toribio
Teodoro & Sons Inc. may purchase from appellant doors of the same
kind, provided he pays the price. Surely, the appellant will not refuse, for it
can easily duplicate or even mass-produce the same doors-it is mechanically equipped to do so. The Oriental Sash Factory does nothing more
than sell the goods that it mass-produces or habitually makes; sash, panels, mouldings, frames, cutting them to such sizes and combining them in
such forms as its customers may desire. When this Factory accepts a job
that requires the use of extraordinary or additional equipment, or involves
services not generally performed by it-it thereby contracts for a piece of
work filing special orders within the meaning of Article1467. The orders
herein exhibited were not shown to be special. They were merely orders
for work nothing is shown to call them special requiring extraordinary service of the factory. Anyway, supposing for the moment that the transactions were not sales, they were neither lease of services nor contract jobs
by a contractor. But as the doors and windows had been admittedly manufactured" by the Oriental Sash Factory, such transactions could be, and
should be taxed as "transfers" thereof under section 186 of the National
Revenue Code.
Swedish Match v. CA
October 20, 2004
G.R. No. 128120
Facts: SMNV initiated steps to sell the worldwide match and lighter businesses while retaining for itself the shaving business. Ed Enriquez (Enriquez), Vice-President of Swedish Match Sociedad Anonimas (SMSA) the
management company of the Swedish Match group was commissioned
and granted full powers to negotiate by SMNV, with the resulting transaction, however, made subject to final approval by the board. Enriquez was
held under strict instructions that the sale of Phimco shares should be executed on or before 30 June 1990, in view of the tight loan covenants of
SMNV. Enriquez came to the Philippines in November 1989 and informed
the Philippine financial and business circles that the Phimco shares were
for sale. among the interested parties who offered to buy the Phimco
shares were herein respondent ALS Management & Development Corporation and respondent Antonio Litonjua (Litonjua), the president and general manager of ALS.On 3 November 1989, Litonjua submitted a letter to
SMAB tendering his offer to buy all of the latters shares in Phimco and all
of Phimcos shares in Provident Tree Farm, Inc. and OTT/Louie (Phils.),
Inc. Through its Chief Executive Officer, Massimo Rossi (Rossi), SMAB, in
its letter dated 1 December 1989, informed respondents that their price
offer was below their expectations but urged them to undertake a comprehensive review and analysis of the value and profit potentials of the Phimco shares, with the assurance that respondents would enjoy a certain priority although several parties had indicated their interest to buy the
shares. Rossi sent his letter dated 11 June 1990, informing Litonjua that
ALS should undertake a due diligence process or pre-acquisition audit and
review of the draft contract . However, Rossi made it clear that at the
completion of the due diligence process, ALS should submit its final offer
in US dollar terms not later than 30 June 1990.Litonjua in a letter dated 18
June 1990, expressed disappointment at the apparent change in SMABs
approach to the bidding process.He informed Rossi that it may not be
possible for them to submit their final bid on 30 June 1990, citing the advice to him of the auditing firm that the financial statements would not be
completed until the end of July. Litonjua added that he would indicate in
their final offer more specific details of the payment mechanics and consider the possibility of signing a conditional sale at that time.Apparently
irked by SMABs decision to junk his bid, Litonjua promptly responded by
letter dated 4 July 1990. He stressed that they were firmly committed to
their bid of US$36 million.More than two months from receipt of Litonjuas
last letter, Enriquez sent a fax communication to the former, advising him
that the proposed sale of SMABs shares in Phimco with local buyers did
not materialize. Enriquez then invited Litonjua to resume negotiations with
SMAB for the sale of Phimco shares. He indicated that SMAB would be
prepared to negotiate with ALS on an exclusive basis for a period of fifteen
(15) days from 26 September 1990 subject to the terms contained in the
letter. Additionally, Enriquez clarified that if the sale would not be completed at the end of the fifteen (15)-day period, SMAB would enter into negotiations with other buyers. Shortly thereafter, Litonjua sent a letter express-
ing his objections to the totally new set of terms and conditions for the sale
of the Phimco shares. He emphasized that the new offer constituted an
attempt to reopen the already perfected contract of sale of the shares in
his favor. He intimated that he could not accept the new terms and conditions contained therein. On 14 December 1990, respondents, as plaintiffs,
filed before the Regional Trial Court (RTC) of Pasig a complaint for specific performance with damages. The Trial Court dismissed the case due to
there being no perfected contract of sale. The Court of Appeals reversed
the decision of the Trial Court ruling that the letters exchanged by and between the parties, taken together, were sufficient to establish that an
agreement to sell the disputed shares to respondents was reached.
Hence, this petition.
Issue: Whether or not the contract between petitioner and respondents
has been perfected.
Held: No. The acquisition audit and submission of a comfort letter, even if
considered together, failed to prove the perfection of the contract. Quite
the contrary, they indicated that the sale was far from concluded. Respondents conducted the audit as part of the due diligence process to help
them arrive at and make their final offer. On the other hand, the submission of the comfort letter was merely a guarantee that respondents had
the financial capacity to pay the price in the event that their bid was accepted by petitioners. Therefore there was no perfection of the contract of
sale.
Held: Yes. A reading of the petitioners letter of October 20, 1986 informing
CLCI that the banks board of directors passed a resolution for the repurchase of [your] property shows that the tenor of acceptance, except for the
repurchase price, was subject to conditions not identical in all respects
with the CLCIs letter-offer of July 31, 1986. In this sense, the banks October 20, 1986 letter was effectively a counter-offer that CLCI must be
shown to have accepted absolutely and unqualifiedly in order to give birth
to a perfected contract. Evidence exists showing that CLCI did not sign
any document to show its conformity with the banks counter-offer. Testimony also exists explaining why CLCI did not sign. Atty. Cuison testified
that CLCI did not agree with the implementation of the repurchase transaction since the bank made a wrong computation. These indicators notwithstanding, we find that CLCI accepted the terms of the TRC Repurchase Agreement and thus unqualifiedly accepted the banks counter-offer
under the TRB Repurchase Agreement and, in fact, partially executed the
agreement,
DIZON vs. CA
G.R. No. 122544
January 28, 2003
Facts: Both cases are consolidated which involved Private Respondent,
Overland Express Lines, Inc. entering into a Contract of Lease with Option
to Buy with Petitioners which involved a 1, 755.80 square meter parcel
land located at MacArthur Highway and South H Street, Diliman, Quezon
City. The term of the lease was for one year, and the private respondent
was granted an option to purchase for the amount of P3,000.00 per
square meter. Private Respondent failed to pay the increased rental of
P8,000 prompting Petitioners to file a case for ejectment against them.
The City Court ordered Private Respondents to vacate the leased premises and to pay the sum of P624,000 which represented rentals in arrears
and as damages in the form of reasonable compensation for the use and
occupation of the premises during the period of illegal detainer. Private
Respondent alleged that there was a perfected contract of sale between
the parties, and it opined that the partial payment for the leased property
which petitioners accepted through Alice Dizon, for which an official receipt was issued was the operative act that gave rise to a perfected contract of sale, and that for the failure of the petitioners to deny receipt
thereof, private respondent can therefore assume that Alice Dizon, acting
as agent of petitioners, was authorized by them to receive the money in
their behalf. The Court ruled otherwise, prompting Private Respondents to
file this suit.
Issue: Whether or not there was a perfected contract of sale.
Held: No. There was no perfected contract of sale between the parties.
There was no written proof of Alice Dizons authority to bind the Petitioners. First of all, she was not even a co-owner of the property. Neither was
she empowered by the co-owners to act on their behalf. Furthermore, the
Civil Code in Article 1874 provides that if a sale of a piece of land or any
interest therein is through an agent, the authority of the latter shall be in
writing otherwise the sale shall be void. It cannot be even said that Alice
Dizons acceptance of money bound at least the share of Fidela Dizo, who
was supposed to be paid by the Petitioners. The implied renewal of the
contract of lease between the parties affected only those terms and conditions which are germane to the lessees right of continued enjoyment of the
property. The option to purchase expired after the one year term granted
in the contract.
resolve the contract upon the buyers failure to pay within a fixed period.
Unlike in a contract of sale, the payment of the price is a positive suspensive condition in a contract to sell, failure of which is not a breach but an
event that prevents the obligation of the vendor to convey the title from
becoming effective. The contract of sale of the parties is enforceable notwithstanding the fact that it was an oral agreement and not reduced in
writing. This is so because the provision applies only to executory, and not
to completed, executed or partially executed contracts.In this case, the
contract of sale had been partially executed by the parties, with the transfer of the possession of the property to the respondent and the partial
payments made by the latter of the purchase price thereof.
DEVELOPMENT BANK OF THE PHILIPPINES vs. COURT OF APPEALS and EMERALD RESORT HOTEL CORPORATION
G.R. No. 125838
June 10, 2003
Facts: Private respondent Emerald Resort Hotel Corporation obtained a
loan from petitioner Development Bank of the Philippines. DBP released
the loan of P3,500,000.00 in three installments: P2,000,000.00 on 27 September 1975, P1,000,000.00 on 14 June 1976 and P500,000.00 on 14
September 1976. To secure the loan, ERHC mortgaged its personal and
real properties to DBP.On 18 March 1981, DBP approved a restructuring
of ERHCs loan subject to certain conditions. On 25 August 1981, DBP
allegedly cancelled the restructuring agreement for ERHCs failure to
comply with some of the material conditions of the agreement.
ERHC delivered to DBP three stock certificates of ERHC.On 5 June 1986,
alleging that ERHC failed to pay its loan, DBP filed with the Office of the
Sheriff, Regional Trial Court of Iriga City, an Application for Extra-judicial
Foreclosure of Real Estate and Chattel Mortgages.
Deputy Provincial Sheriffs Abel Ramos and Ruperto Galeon issued the
required notices of public auction sale of the personal and real properties.
However, Sheriffs Ramos and Galeon failed to execute the corresponding
certificates of posting of the notices. On 10 July 1986, the auction sale of
the personal properties proceeded.
The Office of the Sheriff scheduled on 12 August 1986 the public auction
sale of the real properties. The Bicol Tribune published on 18 July 1986,
25 July 1986 and 1 August 1986 the notice of auction sale of the real
properties. However, the Office of the Sheriff postponed the auction sale
on 12 August 1986 to 11 September 1986 at the request of ERHC. DBP
did not republish the notice of the rescheduled auction sale because DBP
and ERHC signed an agreement to postpone the 12 August 1986 auction
sale.6 ERHC, however, disputes the authority of Jaime Nuevas who
signed the agreement for ERHC.ERHC informed DBP of its intention to
lease the foreclosed properties.
On 22 December 1986, ERHC filed with the Regional Trial Court of Iriga
City a complaint for annulment of the foreclosure sale of the personal and
real properties. Subsequently, ERHC filed a Supplemental Complaint.
ERHC alleged that the foreclosure was void mainly because (1) DBP
failed to comply with the procedural requirements prescribed by law; and
(2) the foreclosure was premature. ERHC maintained that the loan was
not yet due and demandable because the DBP had restructured the loan.
DBP moved to dismiss the complaint because it stated no cause of action
and ERHC had waived the alleged procedural defenses. The trial court
denied the motion to dismiss.
Meanwhile, acting on ERHCs application for the issuance of a writ of preliminary injunction, the trial court granted the writ on 20 August 1990. Accordingly, the trial court enjoined DBP from enforcing the legal effects of
the foreclosure of both the chattel and real estate mortgages.
The trial court rendered a Decision8 dated 28 January 1992 declaring as
null and void the foreclosure and auction sale of the personal properties of
ferred ownership of the lot to the latter. This is true notwithstanding the
failure of Morales and respondents to pay the balance of the purchase
price.
Petitioner can no longer assail the award of the lot to Morales on the
ground that she had no right to match the highest bid during the public
auction. Whether Morales, as actual occupant and/or lessee of the lot,
was qualified and had the right to match the highest bid is a foregone matter that could have been questioned when the award was made. When the
City of Cebu awarded the lot to Morales, it is assumed that she met all
qualifications to match the highest bid. The subject lot was auctioned in
1965 or more than four decades ago and was never questioned. Thus, it is
safe to assume, as the appellate court did, that all requirements for a valid
public auction sale were complied with.
A sale by public auction is perfected when the auctioneer announces its
perfection by the fall of the hammer or in other customary manner. It does
not matter that Morales merely matched the bid of the highest bidder at
the said auction sale. The contract of sale was nevertheless perfected as
to Morales, since she merely stepped into the shoes of the highest bidder.
Beaumont vs Prieto
Facts: Negotiations having been had, prior to December 4, 1911, between
W. Borck and Benito Valdes, relative to the purchase, at first, of a part of
the Nagtajan Hacienda, situated in the district of Sampaloc of this city of
Manila and belonging to Benito Legarda, and later on, of the entire hacienda, said Benito Valdes, on the date above-mentioned, addressed to
said Borck a letter giving W. Borck an option for three months to buy the
property. Subsequent to the said date, W. Borck addressed to Benito
Valdes several letters relative to the purchase and sale of the hacienda,
and as he did not obtain what he expected or believe he was entitled to
obtain from Valdes, he filed the complaint that originated these proceedings, which was amended on the 10th of the following month, April, by
bringing his action not only against Benito Valdes but also against Benito
Legarda, referred to in the letter mentioned. The defendant Benito Valdez
gave to the plaintiff the document written and signed by him stating that on
January 19, 1912, while the offer or option mentioned in said document
still stood, the plaintiff in writing accepted the terms of said offer and requested of Valdes to be allowed to inspect the property, titles and other
documents pertaining to the property, and offered to pay to the defendant,
immediately and in cash as soon as a reasonable examination could be
made of said property titles and other documents. It was also alleged that,
in spite of the frequent demands made by the plaintiff, the defendants had
persistently refused to deliver to him the property titles and other documents relative to said property and to execute any instrument of conveyance thereof in his favor and that the plaintiff, on account of said refusal on the part of the defendant Valdes, based on instructions from the
defendant Legarda, had suffered damages.
Issue: Whether the agreement between the parties constitutes a mere offer to sell or an actual contract of option.
Held: The plaintiff Borck accepted the offer of sale made to hmi, or the option of purchase given him in document Exhibit E by the defendant Valdes,
of the Nagtajan Hacienda, for the assessed valuation of the same, but his
acceptance was not in accordance with the condition with regard to the
payment of the price of the property. The plaintiff Borck made the offer to
pay the said price, in the first of them, within the period of five months from
December 14, 1911; in the second, within the period of three months from
the same date, and, finally, in the other two documents, within an indefinite
period which could as well be ten days as twenty or thirty or more, counting from the date when the muniments of title relative to the
said hacienda should have been placed at his disposal to be inspected
and he should have found them satisfactory and, in consequence thereof,
the deed of conveyance should have been executed in his favor by the
defendant Valdes.
There was no concurrence of the offer and the acceptance as to one of
the conditions related to the cause of the contract, to wit, the form in which
the payment should be made. The expression of Borck's will was not in
accordance with all the terms of Valdes' proposal, or, what amounts to the
same thing, the latter's promise was not accepted by the former in the
specific terms, in which it was made, and finally, the acceptance of the
said proposal on Borck's part was not unequivocal and without variance of
any sort between it and the proposal.
Issue: Whether or not Remolado still had the right of redemption or repurchase over the property
Held: No, we hold that the trial court and the Appellate Court erred in ordering the reconveyance of the property. There was no binding agreement
for its repurchase. Even on the assumption that the bank should be bound
by its commitment to allow repurchase on or before October 31, 1973, still
Remolado had no cause of action because she did not repurchase the
property on that date.
There may be a moral obligation, often regarded as an equitable consideration (meaning compassion), but if there is no enforceable legal duty,
the action must fail although the disadvantaged party deserves commiseration or sympathy. In the instant case, the bank acted within its legal rights
when it refused to give Remolado any extension to repurchase after October 31, 1973. It had given her about two years to liquidate her obligation.
She failed to do so.
WHEREFORE, the Appellate Court's judgment is reversed and set aside.
tions' on all contracts for the sale said commodity peremptorily giving
plaintiff up to noon again of October 26th, 1956, within which to decide
upon his acceptance of said additional conditions with the warning that if
he failed to do so, it would feel free to advise its planters concerned that
they could negotiate their molasses with other parties;
On the very same day defendant simply and rudely turned down the foregoing friendly gesture of the plaintiff caused by the additional conditions
demanded by the defendant in its letter of September 28, 1956 and bluntly
informed plaintiff that in view of his non-acceptance of said conditions it
would not continue with the sale of the molasses in question to plaintiff
and that it felt free to offer the same to any other interested buyer. Claiming breach of contract, plaintiff prayed that judgment be rendered ordering
defendant to comply with and perform its contractual obligations, pursuant
to its agreement with plaintiff of September 19 and 24, 1956 and in case of
failure to do so, to pay plaintiff any and all damages he may suffer by reason of such non-compliance, plus moral damages and to pay plaintiff reasonable attorney's fees and actual costs of the litigation.
In view of Article 1479 of the New Civil Code, the trial court dismissed the
action. His motion for reconsideration having been denied, plain plaintiff
interposed this appeal.
Issue: Whether or not there was a unilateral promise to buy and sell
Held: No, this contention is not borne out by the facts alleged in the complaint. In the first place, as noted by the trial court in its order denying
plaintiff's motion for reconsideration, plaintiff himself, in paragraph 6 of his
complaint, referred to the transaction as an "option" which he exercised on
September 24, 1956. Then again, in his memorandum in lieu of oral argument, he expressly agreed that the offer made by defendant and described in paragraph 2 of plaintiff's complaint is, In option, a unilateral
promise to sell. And, undoubtedly, this is the offer, the option, the unilateral
promise to sell that was accepted by plaintiff five minutes before the deadline noon of September 24, 1956This acceptance, without consideration, did not create an enforceable obligation on the part of the defendant.
The offer as well as the acceptance, did not contemplate nor produce an
immediately binding and enforceable contract of sale. Both lack a most
essential element the manner of payment of the purchase price.
In fact, it was only after the exercise of the option or acceptance of the unilateral promise to sell that the terms of payment were first discussed. This
was in connection with the clarification of plaintiff's acceptance which was
transmitted to defendant on September 25, 1956Plaintiff's offer of a domestic letter of credit was not accepted by defendant who insisted on a
cash payment of 50% of the purchase value, upon signing of a contract.
Plaintiff, on the other hand, agreed to accede to this provided the price is
reduced from P50.00 per metric ton to 7132.00 Defendant rejected defendant's alternative counter-offer. In the circumstance, there was no complete meeting of the minds of the parties necessary for the perfection of a
ed plaintiff an "option" to buy. And both parties so understood it, as indicated by the caption, "Option to Purchase," given by them to said instrument. Under the provisions thereof, the defendant "agreed, promised and
committed" herself to sell the land therein described to the plaintiff for
P1,510.00, but there is nothing in the contract to indicate that her aforementioned agreement, promise and undertaking is supported by a consideration "distinct from the price" stipulated for the sale of the land.
Furthermore, an option is unilateral: a promise to sell at the price fixed
whenever the offeree should decide to exercise his option within the specified time. After accepting the promise and before he exercises his option,
the holder of the option is not bound to buy. He is free either to buy or not
to buy later. In this case, however, upon accepting herein petitioner's offer
a bilateral promise to sell and to buy ensued, and the respondent ipso facto assumed the obligation of a purchaser. He did not just get the right subsequently to buy or not to buy. It was not a mere option then; it was a bilateral contract of sale.
If the option is given without a consideration, it is a mere offer of a contract
of sale, which is not binding until accepted. If, however, acceptance is
made before a withdrawal, it constitutes a binding contract of sale, even
though the option was not supported by a sufficient consideration. In other
words, since there may be no valid contract without a cause or consideration, the promisor is not bound by his promise and may, accordingly, withdraw it. Pending notice of its withdrawal, his accepted promise partakes,
however, of the nature of an offer to sell which, if accepted, results in a
perfected contract of sale.
WHEREFORE, the decision appealed from is hereby affirmed, with costs
against defendant-appellant Severina Rigos. It is so ordered.
Southwestern Sugar & Molasses Co. vs. Atlantic Gulf & Pacific Co.
51 O.G. 3447
Facts: On March 24, 1953, defendant Atlantic Gulf & Pacific Co. granted
an option to plaintiff Southwestern Sugar & Molasses Co. to buy its barge
for P30,000.00 to be exercised within ninety days. On May 11, 1953, Atlantic Gulf wrote Southwestern Sugar that it was exercising its option and
that it be notified as soon as the barge was available. On May 12, 1953,
Atlantic Gulf replied that their understanding was that the "offer of option"
is to be cash transaction and to be effected at the time the barge was
available. On June 25, 1953, Atlantic Gulf informed Southwestern Sugar
that the damage action could not be turned over to the latter. On June 27,
1953, Southwestern Sugar instituted an action for specific performance in
line with the accepted option, depositing with the Court the purchase price
of 30,000.00. Atlantic Gulf, relying upon Article 1479 of the New Civil
Code, contended that the option was not valid because it was not supported by any consideration apart from the price. Southwestern Sugar
contended that the option became binding on Atlantic Gulf when plaintiff
gave notice of its acceptance during the option period citing as its authority Article 1324 of the New Civil Code which provides that 'when the offer or
has allowed the offeree a certain period to accept, the offer may be withdrawn at any time before acceptance by communicating such withdrawal
except "when the option is founded upon a consideration, as something
paid or promised."
Issue: Whether or not the promise to sell was valid
Held: No, the promise to sell was not valid because it was not supported
by a consideration distinct from the price. There is no question that under
Article 1479 of the New Civil Code "an option to sell" or a "promise to buy
or to sell", as used in said article, to be valid must be "supported by a consideration distinct from the price". This is clearly inferred from the context
of said article that a unilateral promise to buy or to sell, even if accepted,
is only binding if supported by a consideration. In other words, "an accepted unilateral promise" can only have a binding effect if supported by a
consideration. Here, it is not disputed that the option is without consideration. It can, therefore, be withdrawn notwithstanding the acceptance made
of it by appellee.
It is true that under Article 1324 of the New Civil Code, the general rule
regarding offer and acceptance is that, when the offer or gives to the offeree a certain period to accept, "the offer may be withdrawn at any time
before acceptance" except when the option is founded upon consideration, but this general provision must be interpreted as modified by the provision of Article 1479 above referred to, which applies to "a promise to buy
and sell" specifically. As already stated, this rule requires that a premise to
sell to be valid must be supported by a consideration distinct from the
price.
Nietes vs CA
Facts: Petitioner Aquilino Nietes and respondent Dr.Pablo Garcia entered
a Contract of Lease and Option to Buy where the latter agreed to lease
his Angeles Educational Institute to the former.
Mas vs Lanuza
Facts: Judgment was rendered in favor of Jose Mas for the possession of
a certain lot of land described in Tondo, Manila, and declared said lot to be
the property of the estate of which the plaintiff is administrator
The rent is set to P5000 per year up to 5 years and that the LESSOR
agrees to give the LESSEE an option to buy the land and the school building, for P100,000 within the period of the Contract of Lease.
Mas submitted in evidence an agreement signed by the Lanuzas and Hilario that one Francisca Hilario gave the Lanuzas permission to enter upon
the land in question, and to occupy it for such time as Hilarios heirs
should permit, the appellants, on their part, expressly acknowledging the
right and title of Hilario, deceased, to the possession and ownership of
said property, and, among other stipulations, binding themselves to close
the opening in the wall which divided the said lot from their own, should
any question ever arise over the title thereto.
Nietes paid P3000 September 4, 1961 as per advance pay for the school
and he also paid Garcia P2200 on Dec.16, 1962 for partial payment on the
purchase of the property, both were acknowledged by Garcia through the
issuance of receipts. Garcia decided to rescind the contract on the
grounds that Nietes: (1) had not maintained the building in good condition,
(2) had not been using the original name of the school-thereby extinguishing its existence in the eyes of the public and injuring its prestige, (3) no
inventory has been made of all properties of the school, (4) had not collected or much less helped in the collection of back accounts of former
students. Garcias lawyers reminded Nietes that the foregoing obligations
had been one, if not, the principal moving factors which had induced the
lessor in agreeing with the terms embodied in the contract of lease, without which fulfillment, said contract could not have come into existence.
Nietes also deposited 84K to a bank corresponding to the balance for the
purchase of the property.
Issue: Whether or not Nietes can avail of his option to buy the property.
Plaintiff also introduced in evidence that the lot in question was the property of the said Francisco Hilario, and that Timoteo Lanuza had been treating with her for the purchase thereof.
The defendants admit the execution of the agreement, and that they took
possession of the lot but they allege that they entered into it under the
mistaken belief that Francisca Hilario was in fact the owner of the property
and that they discovered later that she held the property merely as administratrix for the true owner. On December 7, 1982 they loaned the true
owner, Lao-Jico, 200 pesos, and took from him an agreement in writing
whereby he promised to sell them the said property for 500 pesos, an
agreement which was never consummated however, because he died a
short time thereafter.
Held: Nietes can avail of the option to buy because he already expressed
his intention to buy the property before the termination of the contract. The
contention of the respondent that the full price of the property should first
be paid before the option could be exercised is of no merit.
The contract doesnt provide such stipulation and as such, the provision of
reciprocal obligations in obligations and contracts should prevail. Notice of
the creditor's decision to exercise his option to buy need not be coupled
with actual payment of the price, so long as this is delivered to the owner
of the property upon performance of his part of the agreement.
Nietes had validly and effectively exercised his option to buy the property
of Dr. Garcia, at least, on December 13, 1962, when he acknowledged
receipt from Mrs. Nietes of the sum of P2,200 then delivered by her "in
partial payment on the purchase of the property" described in the "Contract of Lease with Option to Buy"
The committee's report is dated November 14, 1910, and it appears that
promptly upon the submission of this report, the amount awarded the
plaintiff (P280,025.16) was paid over by the defendant to the plaintiff in
cash; and the letter of counsel for plaintiff dated November 17, 1910, tendering a formal deed of sale of plaintiff's share (participacion) in the business and making demand for the purchase price as fixed by the committee, read together with the formal deed of sale executed November 22,
1910, with its acknowledgment of the receipt of the purchase price, leaves
no room for doubt that at that time the parties understood and accepted
the purchase price therein set forth as full payment of plaintiff's share (participacion) in the business in exact conformity with the conditions imposed
in the agreement consummated to May 3, 1910.
The right to interest arises either by virtue of a contract or by way of damages for delay or failure (demora) to pay the principal on which interest is
demanded, at the time when the debtor is obligated to make such payment. In the case at bar where was no contract, express or implied, for the
payment of interest pending the award of the committee appointed to value the property sold on May 3, 1910, and there was no delay in the punctual compliance with defendant's obligation to make immediate payment,
in cash, of the amount of the award, upon the filing of the report of the
committee.
We conclude that the judgment entered in the court below dismissing the
complaint in this case sine die should be affirmed, with the costs of this
instance against the appellant. So ordered.
The plaintiff argued that if the agreement of May 3, 1910, was a perfected
sale he cannot recover any profits after that date; while on the other hand
the defendant concedes that if said agreement was only a promise to sell
in the future it, standing alone, would not prevent recovery in this action.
UP vs Philab
Facts: In the year 1979, UP decided to construct an integrated system of
research organization known as the Research Complex. As part of the
project, laboratory equipment and furniture were purchased for the National Institute of Biotechnology and Applied Microbiology (BIOTECH) at
the UP Los Banos. The Ferdinand E. Marcos Foundation (FEMF) came
forward and agreed to fund the acquisition of the laboratory furniture, including the fabrication thereof.
Lirio, the Executive Assistant of the FEMF, gave the go-signal to BIOTECH
to contact a corporation to accomplish the project. On July 23, 1982, Dr.
Padolina, the Executive Deputy Director of BIOTECH, arranged for Philippine Laboratory Industries, Inc. (PHILAB), to fabricate the laboratory furniture and deliver the same to BIOTECH for the BIOTECH Building Project,
for the account of the FEMF. Lirio directed Padolina to give the go-signal
to PHILAB to proceed with the fabrication of the laboratory furniture, and
requested Padolina to forward the contract of the project to FEMF for its
approval.
In 1982, Padolina wrote Lirio and requested for the issuance of the purchase order and downpayment for the office and laboratory furniture for
the project.
Padolina also requested for copies of the shop drawings and a sample
contract[5]for the project, but PHILAB failed to forward any sample contract.
PHILAB made partial deliveries of office and laboratory furniture to
BIOTECH after having been duly inspected by their representatives and
FEMF Executive Assistant Lirio.
On August 24, 1982, FEMF remitted P600,000 to PHILAB as downpayment for the laboratory furniture for the BIOTECH project and FEMF made
another partial payment of P800,000 to PHILAB.
UP, through Chancellor Javier and Gapud from FEMP executed a Memorandum of Agreement (MOA) in which FEMF agreed to grant financial
support and donate sums of money to UP for the construction of buildings,
installation of laboratory and other capitalization for the project, not to exceed P29,000,000.00. The MOA, additionally states that: (1)the foundation
shall acquire and donate to the UNIVERSITY the site for the RESEARCH
COMPLEX, (2) donate or cause to be donated to the UNIVERSITY the
sum of P29,000,000.00, and (3) shall continue to support the activities of
the RESEARCH COMPLEX.
Navasero promised to submit the contract for the installation of laboratory
furniture to BIOTECH but failed to do so. BIOTECH reminded Navasero
but instead PHILAB submitted to BIOTECH an accomplishment report on
the project and requested payment thereon. By May 1983, PHILAB had
completed 78% of the project, amounting to P2,288,573.74 out of the total
cost of P2,934,068.90. The FEMF had already paid forty percent (40%) of
the total cost of the project. Padolina wrote Lirio and furnished him the
progress billing from PHILAB.[10] FEMF made another partial payment, in
check, ofP836,119.52 representing the already delivered laboratory and
office furniture after the requisite inspection and verification thereof by representatives from the BIOTECH, FEMF, and PHILAB.
FEMF failed to pay the bill and PHILAB reiterated its request for payment
through a letter however, there was no response from the FEMF. Philab
appealed for the payment of its bill even on installment basis. Navasero
wrote BIOTECH requesting for its much-needed assistance for the payment of the balance already due plus interest of P295,234.55 for its fabrication and supply of laboratory furniture.
PHILAB asked Cory Aquino for help to secure the payment of the amount
due from the FEMF. It was referred to then Budget Minister Romulo and
referred the same to UP President Edgardo Angara on June 9, 1986.
Raul P. de Guzman, the Chancellor of UP Los Baos, wrote then Chairman
of the (PCGG) Jovito Salonga, submitting PHILABs claim to be officially
entered as accounts payable as soon as the assets of FEMF were liquidated by the PCGG. Chancellor De Guzman wrote Navasero requesting
for a copy of the contract executed between PHILAB and FEMF.
Exasperated, PHILAB filed a complaint for sum of money and damages
against UP and the latter denied liability and alleged that PHILAB had no
cause of action against it because it was merely the donee/beneficiary of
the laboratory furniture in the BIOTECH; and that the FEMF, which funded
the project, was liable to the PHILAB for the purchase price of the laboratory furniture. UP specifically denied obliging itself to pay for the laboratory
furniture supplied by PHILAB. Case was dismissed by lack of merit.
Held:
Petitioner argues that the CA overlooked the evidentiary effect and substance of the corresponding letters and communications which support the
statements of the witnesses showing affirmatively that an implied contract
of sale existed between PHILAB and the FEMF. The petitioner furthermore
asserts that no contract existed between it and the respondent as it could
not have entered into any agreement without the requisite public bidding
and a formal written contract.
The respondent, on the other hand, submits that the CA did not err in not
applying the law on contracts between the respondent and the FEMF. It,
likewise, attests that it was never privy to the MOA entered into between
the petitioner and the FEMF. The respondent adds that what the FEMF
donated was a sum of money equivalent to P29,000,000, and not the laboratory equipment supplied by it to the petitioner. The respondent submits
that the petitioner, being the recipient of the laboratory furniture, should
not enrich itself at the expense of the respondent.
It bears stressing that the respondents cause of action is one for sum of
money predicated on the alleged promise of the petitioner to pay for the
purchase price of the furniture, which, despite demands, the petitioner
failed to do. However, the respondent failed to prove that the petitioner
ever obliged itself to pay for the laboratory furniture supplied by it. Hence,
the respondent is not entitled to its claim against the petitioner.
There is no dispute that the respondent is not privy to the MOA executed
by the petitioner and FEMF; hence, it is not bound by the said agreement.
Contracts take effect only between the parties and their assigns. A contract cannot be binding upon and cannot be enforced against one who is
not a party to it, even if he is aware of such contract and has acted with
knowledge thereof. Likewise admitted by the parties, is the fact that there
was no written contract executed by the petitioner, the respondent and
FEMF relating to the fabrication and delivery of office and laboratory furniture to the BIOTECH.
Based on the records, an implied-in-fact contract of sale was entered into
between the respondent and FEMF. A contract implied in fact is one implied from facts and circumstances showing a mutual intention to contract.
It arises where the intention of the parties is not expressed, but an agreement in fact creating an obligation. It is a contract, the existence and terms
of which are manifested by conduct and not by direct or explicit words between parties but is to be deduced from conduct of the parties, language
used, or things done by them, or other pertinent circumstances attending
the transaction. To create contracts implied in fact, circumstances must
warrant inference that one expected compensation and the other to pay.
An implied-in-fact contract requires the parties intent to enter into a contract; it is a true contract. The conduct of the parties is to be viewed as a
reasonable man would view it, to determine the existence or not of an implied-in-fact contract. The totality of the acts/conducts of the parties must
be considered to determine their intention. An implied-in-fact contract will
not arise unless the meeting of minds is indicated by some intelligent conduct, act or sign.
Judgement is reversed.
Velasco vs CA
Facts: Lorenzo Velasco& Magdalena Estate, Inc. entered into a contract of
sale involving a lot in New Manila for 100K.The agreement was that
Lorenzo would give a down payment of 10K (as evidenced by a receipt)
to be followed by 20K (time w/in which to make full down payment was
not specified) and the balance of 70K would be paid in installments, the
equal monthly amortization to be determined as soon as the 30K had
been paid. Lorenzo paid the 10K but when he tendered payment for 20K,
Magdalena refused to accept & refused to execute a formal deed of sale.
Velasco filed a complaint for damages. Magdalena denied having any
dealings/contractual relations w/ Lorenzo. It contends that a portion of the
property was being leased by Lorenzos sister-in-law, Socorro Velasco
who went to their office & they agreed to the sale of the property (30K
down payment, 70K on installments+9% interest). Since Socorro was
only able to pay10K, it was merely accepted as deposit & on her request,
the receipt was made in the name of Lorenzo. Socorro failed to complete
the down payment & neither has she paid the 70K. It was only 2 years after that she tendered payment for 20K & by then, Magdalena considered
their offer to sell rescinded.
According to Lorenzo, he had requested Socorro to make the necessary
contracts & he had authorized her to make negotiations w/ Magdalena on
her own name, as he doesnt understand English. He also uses as evidence the receipt to prove that there already had been a perfected contract to sell as the annotations therein indicated that earnest money for
10K had been received & also the agreed price (100K, 30K dp&bal in 10
yrs) appears thereon. To further prove that it was w/ him & not w/ Socorro
that Magdalena dealt with, he showed 5 checks drawn by him for payment
of the lease of the property.
Issue: WON there was a consummated sale? NO
Held: The minds of the parties did not meet in regard to the matter of
payment. It is admitted
that they still had to meet and agree on how & when the down payment &
installments
were to be paid. Therefore, it cannot be said that a definite & firm sales
agreement
between the parties had been perfected. The definite agreement on the
manner of payment of the purchase price is an essential element in the
formation of a binding & enforceable contract of sale.The fact that Velasco
delivered to Magdalena the sum of 10K as part of the down payment that
they had to be pay cannot be considered as sufficient proof of the perfection of any purchase & sale agreement between the parties under Art
1428, NCC.
SPS DOROMAL VS CA
FACTS: A parcel of land in Iloilo were co-owned by 7 siblings all surnamed
Horilleno. 5 of the siblings gave a SPA to their niece Mary Jimenez, who
succeeded her father as a co-owner, for the sale of the land to father and
son Doromal. One of the co-owner, herein petitioner, Filomena Javellana
however did not gave her consent to the sale even though her siblings executed a SPA for her signature. The co-owners went on with the sale of
6/7 part of the land and a new title for the Doromals were issued.
Respondent offered to repurchase the land for 30K as stated in the deed
of sale but petitioners declined invoking lapse in time for the right of repurchase. Petitioner also contend that the 30K price was only placed in the
deed of sale to minimize payment of fees and taxes and as such, respondent should pay the real price paid which was P115, 250.
Issue: WON the period to repurchase of petitioner has already lapsed.
Held: Period of repurchase has not yet lapsed because the respondent
was not notified of the sale. The 30-day period for the right of repurchase
starts only after actual notice not only of a perfected sale but of actual execution and delivery of the deed of sale.
The letter sent to the respondent by the other co-owners cannot be considered as actual notice because the letter was only to inform her of the
intention to sell the property but not its actual sale. As such, the 30-day
period has not yet commenced and the respondent can still exercise his
right to repurchase.
The respondent should also pay only the 30K stipulated in the deed of
sale because a redemptioners right is to be subrogated by the same
terms and conditions stipulated in the contract.
I concur in the result not upon the grounds stated in the majority opinion
but for the following reasons: The deed of sale executed by Ramon Alcantara on 3 August 1931 conveying to Sia Suan five parcels of land is null
and void insofar as the interest, share, or participation of Ramon Alcantara
in two parcels of land is concerned, because on the date of sale he was
17 years, 10 months and 22 days old only. Consent being one of the essential requisites for the execution of a valid contract, a minor, such as
Ramon Alcantara was, could not give his consent thereof. The only misrepresentation as to his age, if any, was the statement appearing in the
instrument that he was of age. On 27 August 1931, or 24 days after the
deed was executed, Gaw Chiao, the husband of the vendee Sia Suan,
was advised by Atty. Francisco Alfonso of the fact that his client Ramon
Alcantara was a minor. The fact that the latter, for and in consideration of
P500, executed an affidavit, whereby he ratified the deed of sale, is of no
moment. He was still minor. The majority opinion invokes the rule laid
down in the case of Mercado et al. vs. Espiritu, 37 Phil., 215. The rule laid
down by this Court in that case is based on three judgments rendered by
the Supreme Court of Spain on 27 April 1960, 11 July 1868, and 1 March
1875. In these decisions the Supreme Court of Spain applied Law 6, Title
19, of the 6th Partida which expressly provides:
The contract of sale involved in the case of Mercado vs. Espiritu, supra,
was executed by the minors on 17 May 1910. The Law in force on this
last-mentioned date was not Las Siete Partidas, 1 which was the in force
at the time the cases decided by the Supreme Court of Spain referred to,
but the Civil Code which took effect in the Philippines on 8 December
1889. As already stated, the Civil Code requires the consent of both parties for the valid execution of a contract (art. 1261, Civil Code). As a minor
cannot give his consent, the contract made or executed by him has no validity and legal effect. There is no provision in the Civil Code similar to that
of Law 6, Title 19, of the 6th Partida which is equivalent to the common
law principle of estoppel. If there be an express provision in the Civil Code
similar law 6, Title 19, of the 6th Partida, I would agree to the reasoning of
the majority. The absence of such provision in the Civil Code is fatal to the
validity of the contract executed by a minor. It would be illogical to uphold
the validity of a contract on the ground of estoppel, because if the contract
executed by a minor is null and void for lack of consent and produces no
legal effect, how could such a minor be bound by misrepresentation about
his age? If he could not be bound by a direct act, such as the execution of
a deed of sale, how could he be bound by an indirect act, such as misrepresentation as to his age? The rule laid down in Young vs. Tecson, 39 O.
G. 953, in my opinion, is the correct one.
Nevertheless, as the action in this case was brought on 8 August 1940,
the same was barred, because it was not brought within four (4) years after the minor had become of age, pursuant to article 1301 of the Civil
Code. Ramon Alcantara became of age sometime in September 1934.
doubt that the attorney in fact may execute a valid sale. An instrument
may be captioned as "special power of attorney" but if the powers granted
are couched in general terms without mentioning any specific power to sell
or mortgage or to do other specific acts of strict dominion, then in that
case only acts of administration may be deemed conferred.
Further, the right of an innocent purchaser for value must be respected
and protected, even if the seller obtained his title through fraud. The fact
remains that the Certificate of Title, as well as other documents necessary
for the transfer of title were in the possession of plaintiff's wife, Irma L.
Veloso, consequently leaving no doubt or any suspicion on the part of the
defendant as to her authority.
Private respondents They are related by blood to the petitioners as descendants of Felipe.
Leon held in trust for his co-heirs the property left by their late father. During Leons lifetime, his co-heirs made several seasonable and lawful demands upon him to subdivide and partition the property, but no subdivision
took place.
After the death of Leon, private respondents discovered that the shares of
four of the heirs of Felipe was purchased by Leon as evidenced by a Deed
of Sale executed on August 25, 1946 but registered only in 1971. Also,
Leon had, sometime in July 1970, executed a sale and partition of the
property in favor of his own children, herein petitioners.
Private respondents then filed a case for partition with annulment of documents and/or reconveyance and damages. The latter contended that the
sale in favor of Leon was fraudulently obtained through machinations and
false pretenses. Thus, the subsequent sale of the lot by Leon to his children was null and void despite the OCT in his favor.
Petitioners, for their part, claimed that the sale by Simplicio, Fausta, Nicolasa, and Maria Baltazar was a valid sale.
Trial court rendered favorable decision to the herein petitioners. However,
CA reversed the ruling of lower court as far as the authority of Maria Baltazar to convey any portion of her late husbands estate. Maria Baltazar
had no authority to sell the portion of her late husbands share inherited by
her then minor children since she had not been appointed their guardian.
Respondent court likewise declared that as far as private respondents
Procerfina, Prosperidad, Ramon and Rosa, were concerned, the Deed of
Sale of August 25, 1946 was "unenforceable." Hence this petition.
ISSUE: W/N the Deed of Sale unenforceable against the private respondents for being an unauthorized contract.
HELD: We find no reversible error committed by the respondent appellate
court in declaring the Deed of Sale unenforceable on the children of Maria
Baltazar. Under the law then prevailing at the time of the demise of her
spouse, her husbands share in the common inheritance pertained to her
minor children who were her late husbands heirs and successors-in-interest.
The old Civil Code governs the distribution and disposition of his intestate
estate. Thereunder, the legitime of the children and descendants consisted of two-thirds (2/3) of the hereditary estate of the father and of the
mother (first paragraph, Article 808); and the widower or widow, as the
case may be, who, at the time of death of his or her spouse, was not divorced or if divorced, due to the fault of the deceased spouse, was entitled
mittedly excluded and that then minors Rosa and Douglas were not properly represented therein, the settlement was not valid and binding upon
them and consequently, a total nullity.
SEC. 7. Parents as Guardians. When the property of the child under
parental authority is worth two thousand pesos or less, the father or the
mother, without the necessity of court appointment, shall be his legal
guardian. When the property of the child is worth more than two thousand
pesos, the father or the mother shall be considered guardian of the childs
property, with the duties and obligations of guardians under these Rules,
and shall file the petition required by Section 2 hereof. For good reasons,
the court may, however, appoint another suitable persons.
Administration includes all acts for the preservation of the property and the
receipt of fruits according to the natural purpose of the thing. Any act of
disposition or alienation, or any reduction in the substance of the patrimony of child, exceeds the limits of administration. Thus, a father or mother,
as the natural guardian of the minor under parental authority, does not
have the power to dispose or encumber the property of the latter. Such
power is granted by law only to a judicial guardian of the wards property
and even then only with courts prior approval secured in accordance with
the proceedings set forth by the Rules of Court.
sible may have become possible; or the intention which could not be ascertained may have been clarified by the parties. The ratification or second contract would then be valid from its execution; however, it does not
retroact to the date of the first contract.
will exceed the allowed foreign equity, what the law disqualifies is the corporation from owning land. Regarding the 60%-40% corporation rule, the
prohibition in the Constitution applies only to ownership of land. It does not
extend to immovable or real property as defined under Article 415 of the
Civil Code. Otherwise, we would have a strange situation where the ownership of immovable property such as trees, plants and growing fruit attached to the land would be limited to Filipinos and Filipino corporations
only.
Clarin v. Rulona
GR No. L-30786, 20 February 1984
Facts: Two exhibits were shown by the Petitioner. Exhibit A contains an
authorization to survey the 10 hectares to be awarded to the respondents
which the couple (Rulonas) purchased from the Clarins for 2,500 pesos.
Exhibit B contains the acknowledgment of Clarin that Mr. Rulona paid 800
pesos as initial payment. The conditions of the sale were that a downpayment of P1,000.00 was to be made and then the balance of P1,500.00
was to be paid in monthly installment of P100.00. As shown by Exhibit B,
the respondent delivered to the petitioner a downpayment of P800.00 and
on the first week of June the amount of P200.00 was also delivered thereby completing the downpayment of P1,000.00. On the first week of August, another delivery was made by the respondent in the amount of
P100.00 as payment for the first installment. Respondent further alleged
that despite repeated demands to let the sale continue and for the petitioner to take back the six postal money orders, the latter refused to comply. petitioner alleged that while it is true that he had a projected contract
of sale of a portion of land with the respondent, such was subject to the
following conditions: (1) that the contract would be realized only if his coheirs would give their consent to the sale of a specific portion of their
common inheritance from the late Aniceto Clarin before partition of the
said common property and (2) that should his co-heirs refuse to give their
consent, the projected contract would be discontinued or would not be realized. The trial court and CA ruled in favor of the respondent. Hence, this
petition.
Issue: Whether or not there has been a perfected contract of sale between
petitioner and respondent
Held: YES. While it is true that Exhibits A and B are, in themselves, not
contracts of sale, they are, however, clear evidence that a contract of sale
was perfected between the petitioner and the respondent and that such
contract had already been partially fulfilled and executed. A contract of
sale is perfected at the moment there is a meeting of minds upon the thing
which is the object of the contract and upon the price. Such contract is
binding in whatever form it may have been entered into. Construing Exhibits A and B together, it can be seen that the petitioner agreed to sell and
the respondent agreed to buy a definite object, that is, ten hectares of land
which is part and parcel of Lot 20 PLD No. 4, owned in common by the
petitioner and his sisters although the boundaries of the ten hectares
would be delineated at a later date. The parties also agreed on a definite
price which is P2,500.00. Exhibit B further shows that the petitioner has
received from the respondent as initial payment, the amount of P800.00.
Hence, it cannot be denied that there was a perfected contract of sale between the parties and that such contract was already partially executed
when the petitioner received the initial payment of P800.00. The latter's
acceptance of the payment clearly showed his consent to the contract
thereby precluding him from rejecting its binding effect.
Tanedo v. CA
GR No. 104482, 22 January 1996
Facts: Lazardo Taedo executed a notarized deed of absolute sale in favor of his eldest brother, Ricardo Taedo, and the latter's wife, Teresita
Barera, private respondents herein, whereby he conveyed to the latter in
consideration of P1,500.00 a lot in Gerona, Tarlac stating that it is his future inheritance from his parents. Upon the death of his father, Lazaro executed an "Affidavit of Conformity" re-affirm, respect, acknowledge and
validate the sale he made. Ricardo learned that Lazaro sold the same
property to his children, petitioners herein, through a deed of sale. Petitioners filed a complaint for rescission (plus damages) of the deeds of sale
executed by Lazaro in favor of private respondents covering the property
inherited by Lazaro from his father. Lazaro testified that he sold the property to Ricardo. Both the trial court and the CA ruled in favor of the respondents.
Issue: Whether or not a sale of future inheritance valid?
Held: NO. Pursuant to Article 1347 of the Civil Code, "(n)o contract may
be entered into upon a future inheritance except in cases expressly authorized by law." Consequently, said contract made in 1962 conveying one
hectare of his future inheritance is not valid and cannot be the source of
any right nor the creator of any obligation between the parties. Hence, the
"affidavit of conformity" dated February 28, 1980, insofar as it sought to
validate or ratify the 1962 sale, is also useless and, in the words of the
respondent Court, "suffers from the same infirmity." Even private respondents in their memorandum concede this. However, the documents which
followed after the death of Lazaros father in favor of private respondents
are material. These two documents were executed after the death of Matias (and his spouse) and after a deed of extra-judicial settlement of his
(Matias') estate was executed, thus vesting in Lazaro actual title over said
property.
Atty. Pedro M. Ferrer vs Spouses Alfredo Diaz and Imelda Diaz, Reina
Comandante and Spouses Bienvenido Pangan and Elizabeth Panga
GR No. 165300, April 23, 2010
Facts:Petitioner Atty. Ferrer claimed in his complaint that on May 7,
1999, the Diazes, as represented by their daughter Comandante,
through a Special Power of Attorney (SPA),obtained from him a
loan of P1,118,228.00. The loan was secured by a Real Estate
Mortgage Contract by way of second mortgage over Transfer Certificate of Title (TCT) No. RT6604 and a Promissory Note payable
within six months or up to November 7, 1999. Comandante also
issued to petitioner postdated checks to secure payment of said
loan.
Petitioner further claimed that prior to this or on May 29,
1998, Comandante, for a valuable consideration of P600,000.00,
which amount formed part of the abovementioned secured loan,
executed in his favor an instrument entitled Waiver of Hereditary
Rights and Interests Over a Real Property (Still Undivided).In her
Reply, respondent alleged that sometime in 1998, she sought the help
of petitioner with regard to the mortgage with a bank of her
parents lot located at No. 6, Rd. 20, Project 8, Quezon City
and covered by TCT No. RT6604. She also sought financial
accommodations from the couple on several occasions which
totaled P500,000.00. Comandante, however, claimed that these
loans were secured by chattel mortgages over her taxi units in
addition to several postdated checks she issued in favor of
petitioner.
As she could not practically comply with her obligation, petitioner and his wife, presented to Comandante sometime in May
1998 a document denominated as Waiver of Hereditary Rights
and Interests Over a Real Property (Still Undivided) pertaining
to a waiver of her hereditary share over her parents property.
The Pangans, on the other hand, asserted that the annotation of
petitioners adverse claim on TCT No. RT6604 cannot impair
their rights as new owners of the subject property. They
claimed that the Waiver of Hereditary Rights and Interests O
ver a Real Property (Still Undivided) upon which petitioners adverse claim is anchored cannot be the source of any right or
interest over the property considering that it is null and void
under paragraph 2 of Article 1347 of the Civil Code.
Issue: Is Comandantes waiver of hereditary rights valid? Is petitioners adverse claim based on such waiver likewise valid and
effective?
Held: No. Pursuant to the second paragraph of Article 1347 of
the Civil Code,no contract may be entered into upon a future
inheritance except in cases expressly authorized by law. For
the inheritance to be considered future, the succession must
not have been opened at the time of the contract. A contract
may be classified as a contract upon future inheritance, prohibited under the second paragraph of Article 1347, where the
following requisites concur:
1)That
the
succession
has
not
yet
been
opened. (2)
(3)That the object of the contract forms part of the inheritance; and, That the promissor has, with respect to the object,
an expectancy of a right which is purely hereditary in nature.
In this case, there is no question that at the time of execution of Comandantes Waiver of Hereditary Rights and Interest
Over a Real Property (Still Undivided), succession to either of
her parents properties has not yet been opened since both of
them are still living. With respect to the other two requisites,
both are likewise present considering that the property subject
matter of Comandantes waiver concededly forms part of the
properties that she expect to inherit from her parents upon
their death and, such expectancy of a right, as shown by the
facts, is undoubtedly purely hereditary in nature. From the
foregoing, it is clear that Comandante and petitioner entered
into a contract involving the formers future inheritance as embodied in the Waiver of Hereditary Rights and Interest Over a
Real Property (Still Undivided) executed by her inpetitioners favor. Hence, the Waiver of Hereditary Rights and Interest Over
a Real Property (Still Undivided) executed by Comandante in
favor of petitioner as not valid and that same cannot be the
source of any right or create an obligation between them for
being violative of the second paragraph of Article 1347 of the
Civil Code.
HEIRS OF JUAN SAN ANDRES (VICTOR S. ZIGA) and SALVACION S. TRIA vs. VICENTE RODRIGUEZ
G.R. No. 135634
May 31, 2000
Facts: Juan San Andres was the registered owner of Lot No.
1914-B1335, as situated in Liboton, Naga City. On September
28, 1964, he sold a portion thereof, consisting of 345 square
meters, to
respondent Vicente S. Rodriguez for P2,415.00. The sale is
evidenced by a Deed of Sale.Upon the death of Juan San
Andres on May 5, 1965, Ramon San Andres was appointed judicial administrator of the decedent's estate. Ramon San Andres
engaged the services of a geodetic engineer, Jose Peero, to
prepare a consolidated plan of the estate. Engineer Peero also
prepared a sketch plan of the 345-square meter lot sold to
respondent. From the result of the survey, it was found that
respondent had enlarged the area which he purchased from
the late Juan San Andres by 509 square meters.Accordingly,
the judicial administrator sent a letter,dated July 27, 1987, to
respondent demanding that the latter vacate the portion allegedly
encroached by him.
However, respondent refused to do so, claiming he had purchased the same from the late Juan San Andres. Thereafter,
on November 24, 1987, the judicial administrator brought an
action, in behalf of the estate of Juan San Andres, for recovery of possession of the 509 lot.
Respondent alleged that the full payment of the 509square meter lot would be effected within five (5) years from the
execution of a formal deed of sale after a survey is conducted over said property. He further alleged that with the
consent of the former owner, Juan San Andres, he took possession of the same and introduced improvements thereon as
early as 1964.
Respondent Vicente Rodriguez died on August 15, 1989 and
was substituted by his heirs.
Bibiana B. Rodriguez, widow of respondent Vicente Rodriguez,
testified that they had been in possession of the 509 square meter lot since 1964 when the late Juan San Andres signed
the receipt.
She testified that they did not know at that time the exact
area sold to them because they were told that the same
would be known after the survey of the subject lot.
Petitioner contends,that the "property subject of the sale was
not described with sufficient certainty such that there is a necessity of another agreement between the parties to finally ascertain the identity; size and purchase price of the property
which is the object of the alleged sale.
Issue:
(1)Whether or not the object of the contract is determinate?
(2)Is the contract of sale between the parties absolute?
Held:
(1)Yes. There is no dispute that respondent purchased a portion
of Lot 1914-middle of Lot 1914-B-B-2 consisting of 345 square
meters. This portion is located in the 2, which has a total
area of 854 square meters, and is clearly what was referred to
in the receipt as the "previously paid lot." Since the lot subsequently sold to respondent is said to adjoin the "previously
paid lot" on three sides thereof, the subject lot is capable of
being determined without the need of any new contract. The
fact that the exact area of these adjoining residential lots is
subject to the result of a survey does not detract from the
fact that they are determinate or determinableConcomitantly, the
object of the sale is certain and determinate. Under Article
1460 of the New Civil Code, a thing sold is determinate if at
the time the contract is entered into, the thing is capable of
being determinate without necessity of a new or further
agreement betwe en the parties. Here, this definition finds realization.
Appellee's Exhibit "A" affirmingly shows that the original 345
sq. m. portion earlier sold lies at the middle of Lot 1914-of
the said Lot 19 14-B-B-2 surrounded by the remaining portion 2
on three (3) sides, in the east, in the west and in the
north.
The northern boundary is a 12 meter road. Conclusively, therefore, this is the only remaining 509 sq. m. portion of Lot
1914 Rod-B-2 surrounding the 345 sq. m. lot initially purchased
by Rodriguez. It is quite definite, determinate and certain.
(2)Yes.A deed of sale is considered absolute in nature where
there is neither a stipulation in the deed that title to the
property sold is reserved in the seller until full payment of
the price, nor one giving the vendor the right to unilaterally
resolve the contract the moment the buyer fails to pay within
a fixed period. In this case, there is no reservation of ownership
nor a stipulation providing for a unilateral rescission by either
party. In fact, the sale was consummated upon the delivery of
the lot to respondent. Thus, Art. 1477 provides that the ownership of the thing sold shall be transferred to the vendee upon
the actual or
constructive delivery thereof.
BAGNAS V. CA
FACTS: Hilario died with no will and was survived only by collateral relatives. Bagnas (et al) were the nearest kin. Retonil (et al) were also relatives but to a farther extent. They claimed ownership over 10 lots from the
estate of Hilario presenting notarized and registered estate of Hilario presenting notarized and registered Deeds of Sale where the consideration
for the lands was P1 and services rendered, and to be rendered. Bagnas
argued that the sales were fictitious, while Retonil claimed to have done
many things for Hilario - such as nursing him on his deathbed.
ISSUE: WON there was a valid contract of sale
RULING: No. At the onset, if a contract has no considerate, it is not merely
voidable, but void- and even in collateral heirs may assail the contract. In
this case, there was no consideration. Price must be in money or its
equivalent; services are not equivalent of money insofar as the requirement of price is concerned. A contract is not one for sale if the consideration consists of services. Not only are they vague, they are unknown and
not susceptible of determination without a new agreement between the
parties.
GOQUILAY V. SYCIP
FACTS:
>Tan Sin An and Goquiolay entered into a general commercial partnership
under the name "Tan Sin An and Antonio Goquiolay" for the purpose of
dealing in real estate.
>The agreement lodged upon Tan Sin An as the sole management of
partnership affairs.
>The lifetime of the partnership was fixed at ten years and the Artticles of
Copartnership stipulated that in the event of death of any of the partners
before the expiration of the term, the partnership will not be dissolved but
will be continued by the heirs or assigns of the deceased partner. But the
partnership could be dissolved upon mutual agreement in writing of the
partners.
>The plaintiffs challenged the authority of Kong Chai Pin to sell the partnership properties on the ground that she had no authority to sell because
even granting that she became a partner upon the death of Tn Sin An the
power of attorney granted in favor of the latter expired after his death.
ISSUE: WON in sale of partnership properties, consent of all partners are
necessary.
RULING: No. As to whether or not the consent of the other partners was
necessary to perfect the sale of the partnership properties, the Court believes that it is not. Strangers dealing with a partnership have the right to
assume, in the absence of restrictive clauses in the co- partnership
agreement, that every general partner has power to bind the partnership.
Ladanga v. CA
Facts: Clemencia Aseneta, a spinster, had a nephew named Bernardo
and a niece named Salvacion. She legally adopted Bernardo in 1961. On
April 6, 1974, Clemencia signed 9 deeds of sale in favor of Salvacion for
various real properties, one being the Paco property which is the subject
of this petition, and purportedly sold for P26,000. In May 1975, Bernardo,
as guardian of Clemencia, filed a case for reconveyance of the Paco
property. Clemencia testified that she had not received a single centavo
from Salvacion. The trial court, affirmed by the Court of Appeals, declared
the sale void.
Issue: Whether the sale is void for lack of consideration
Held: The Ladanga spouses contend that the Appellate Court disregarded
the rule on burden of proof. This contention is devoid of merit because
Clemencia herself testified that the price of P26,000 was not paid to her.
The burden of the evidence shifted to the Ladanga spouses. They were
not able to prove the payment of that amount. The sale was fictitious. A
contract of sale is void and produces no effect whatsoever where the
price, which appears therein as paid, has in fact never been paid by the
purchaser to the vendor. It was not shown that Clemencia intended to donate the Paco property to the Ladangas. Her testimony and the notary's
testimony destroyed any presumption that the sale was fair and regular
and for a true consideration.
CORNELIA CLANOR VDA. DE PORTUGAL vs. INTERMEDIATE APPELLATE COURT and HUGO C. PORTUGAL
G.R. No. 73564
March 25, 1988
Facts: Cornelia Clanor and her late husband Pascual Portugal, during the
lifetime of the latter, were able to accumulate several parcels of real property. Among these were a parcel of residential land situated in Poblacion,
Gen. Trias, Cavite covered by T.C.T. No. RT-9355 and an agricultural land
located at Pasong Kawayan, Gen. Trias, Cavite under T.C.T. No. RT-9356.
Sometime in January, 1967, the private respondent Hugo Portugal, a son
of the spouses, borrowed from his mother, Cornelia, the certificates of title
to the above-mentioned parcels of land on the pretext that he had to use
them in securing a loan that he was negotiating. On November 17, 1974,
Pascual Portugal died. For the purposes of executing an extra-judicial partition of Pascual's estate, wished to have all the properties of the spouses
collated, Cornelia asked the private respondent for the return of the two
titles she previously loaned, Hugo manifested that the said titles no longer
exist. Transfer Certificate of Title T.C.T. No. 23539 registered in his and his
brother Emiliano Portugal's names, and which new T.C.T. cancelled the
two previous ones. This falsification was triggered by a deed of sale by
which the spouses Pascual Portugal and Cornelia Clanor purportedly sold
for P8,000.00 the two parcels of land adverted to earlier to their two sons,
Hugo and Emiliano. Emiliano caused the reconveyance of Lot No. 2337
previously covered by TCT No. RT-9356 and which was conveyed to him
in the void deed of sale. Hugo, on the other hand, refused to make the
necessary restitution thus compelling the petitioners, his mother and his
other brothers and sisters, to institute an action for the annulment of the
controversial deed of sale and the reconveyance of the title over Lot No.
3201.The Trial Court hereby declares inoperative the Deed of Sale. The
CA reversed the decision stating that the action had already presrcribed.
Issue: W/N the sale is valid.
Ruling: No. No consideration was ever paid at all by the Hugo Portugal.
Applying the provisions of Articles 1350, 1352, and 1409 of the new Civil
Code in relation to the indispensable requisite of a valid cause or consideration in any contract, and what constitutes a void or inexistent contract,
we rule that the disputed deed of sale is void ab initio or inexistent, not
merely voidable.
Facts:
Respondents averment:
Elvira Ong and Yu Bun Guan are husband and wife, They lived together
until she and her children were abandoned by Yu Bun Guan on
August 26, 1992, because of the latter's 'incurable promiscuity, volcanic
temper and other vicious vices'; out of thier union, 3 children were born,
now living with her respondent.
She purchased on March 20, 1968, out of her personal funds, a parcel of
land, then referred to as the Rizal property, from Aurora Seneris, and supported by Title No. 26795, then subsequently registered on April 17,1968,
in her name.
Before their separation in 1992, she 'reluctantly agreed' to Yu Bun Guan
'importunings' that she execute a Deed of Sale of the J.P. Rizal property in
his favor, but on the promise that he would construct a commercial building for the benefit of the children. He suggested that the J.P. Rizal property
should be in his name alone so that she would not be involved in any
obligation. The consideration for the 'simulated sale' was that, after its execution in which he would represent himself as single, a Deed of Absolute
Sale would be executed in favor of the three (3) children and that he would
pay the Allied Bank, Inc. the loan he obtained.
Because of the glib assurances of petitioner, respondent executed a Deed
of Absolute Sale in 1992, but then he did not pay the consideration
of P200,000.00, supposedly the ostensible valuable consideration. On the
contrary, she paid for the capital gains tax and all the other assessments
even amounting to not less thanP60,000.00, out of her personal funds.
Because of the sale, a new title (TCT No. 181033) was issued in his
name, but to insure that he would comply with his commitment, she did
not deliver the owners copy of the title to him.
Petitioner, on the other hand, filed a Petition for Replacement of an owners duplicate title.
He made it appear that it was lost, following which a new owners copy of
the title was issued to petitioner.
Upon discovery of the fraudulent steps taken by the petitioner, respondent
immediately executed an Affidavit of Adverse Claim on November 29,
1993.
She precisely asked the court that the sale of the JP Rizal property be declared as null and void; for the title to be cancelled; payment of actual,
moral and exemplary damages; and attorneys fees.
Petioners version:
It was, on the other hand, the version of petitioner that sometime in 1968
or before he became a Filipino, through naturalization, the JP Rizal property was being offered to him for sale. Because he was not a Filipino, he
utilized respondent as his dummy and agreed to have the sale executed in
the name of respondent, although the consideration was his own and from
his personal funds.
When he finally acquired a Filipino citizenship in 1972, he purchased another property being referred to as the Juno lot out of his own funds. If
only to reflect the true ownership of the JP Rizal property, a Deed of Sale
was then executed in 1972. Believing in good faith that his owners copy of
the title was lost and not knowing that the same was surreptitiously concealed by respondent, he filed in 1993 a petition for replacement of the
owners copy of the title, in court.
Petitioner added that respondent could not have purchased the property
because she had no financial capacity to do so; on the other hand, he was
financially capable although he was disqualified to acquire the property by
reason of his nationality. Respondent was in pari delicto being privy to the
simulated sale.
Issue:\Whether or not the Court of Appeals likewise palpably erred in declaring the sale of the subject property to herein petitioner in 1992 to be
fictitious, simulated and inexistent.
Whether or not the Court of Appeals gravely erred in annulling the title
(TCT No. 181033) to the subject property in the name of herein petitioner
in the absence of actual fraud
Held:
A contract of purchase and sale is null and null and void and produces no effect whatsoever where the same is without cause or consideration in that the purchase price which appears thereon as paid has in fact
never been paid by the purchaser to vendor.
In the present case, it is clear from the factual findings of both lower courts that the Deed of Sale was completely simulated and, hence, void
and without effect.No portion of the P200,000 consideration stated in the
Deed was ever paid. And, from the facts of the case, it is clear that neither
party had any intention whatsoever to pay that amount.
The Deed of Sale was executed merely to facilitate the transfer of the
property to petitioner pursuant to an agreement between the parties to enable him to construct a commercial building and to sell the Juno property
to their children.
Finally, based on the foregoing disquisition, it is quite obvious that
the Court of Appeals did not err in ordering the cancellation of TCT No.
181033, because the Deed of Absolute Sale transferring ownership to petitioner was completely simulated, void and without effect.
MOISES JOCSON vs. HON. COURT OF APPEALS, AGUSTINA JOCSON-VASQUEZ, ERNESTO VASQUEZ
G.R. No. L-55322
February 16, 1989
Facts:Petitioner Moises Jocson and respondent Agustina Jocson-Vasquez
are the only surviving offsprings of the spouses Emilio Jocson and Alejandra Poblete, while respondent Ernesto Vasquez is the husband of Agustina. Alejandra Poblete predeceased her husband without her intestate estate being settled. Subsequently, Emilio Jocson also died intestate on April
1, 1972.
The present controversy concerns the validity of three (3) documents executed by Emilio Jocson during his lifetime. These documents purportedly
conveyed, by sale, to Agustina Jocson-Vasquez what apparently covers
almost all of his properties, including his one-third (1/3) share in the estate
of his wife. Petitioner Moises Jocson assails these documents and prays
that they be declared null and void and the properties subject matter
therein be partitioned between him and Agustina as the only heirs of their
deceased parents.
1) Emilio Jocson sold to Agustina Jocson-Vasquez six (6) parcels
of land, all located at Naic, Cavite, for the sum of ten thousand
P10,000.00 pesos. On the same document Emilio Jocson acknowledged receipt of the purchase price,
2)
RAFAEL G. SUNTAY vs. THE HON. COURT OF APPEALS and FEDERICO C. SUNTAYG.R. No. 114950 December 19, 1995
Facts: Respondent Federico Suntay was the registered owner of a parcel
of land situated in Sto. Nio, Hagonoy, Bulacan.
A rice miller, Federico, in a letter, dated September 30, 1960, applied as a
miller-contractor of the then National Rice and Corn Corporation (NARIC).
His application, although prepared by his nephew-lawyer, petitioner Rafael
Suntay, was disapproved, obviously because at that time he was tied up
with several unpaid loans.
For purposes of circumvention, he had thought of allowing Rafael to make
the application for him. Rafael prepared an absolute deed of sale whereby
Federico, for and in consideration of P20,000.00 conveyed to Rafael said
parcel of land with all its existing structures. Said deed was notarized.
Less than three months after this conveyance, a counter sale was prepared and signed by Rafael who also caused its delivery to Federico.
Through this counter conveyance, the same parcel of land with all its existing structures was sold by Rafael back to Federico for the same consideration of P20,000.00.
Although on its face, this second deed appears to have been notarized, an
examination thereof will show that, it is not the said deed of sale but a certain "real estate mortgage on a parcel of land with TCT No. 16157 to secure a loan of P3,500.00 in favor of the Hagonoy Rural Bank." Nowhere
could be found any entry pertaining to Rafael's deed of sale. Testifying on
this irregularity, Atty. Flores (notary public) admitted that he failed to submit to the Clerk of Court a copy of the second deed. Neither was he able
to enter the same in his notarial register. Even Federico himself alleged in
his Complaint that, when Rafael delivered the second deed to him, it was
neither dated nor notarized.
Federico, requested that Rafael deliver his copy of TCT No. T-36714 so
that Federico could have the counter deed of sale in his favor registered in
his name. The request was turned down, In opposition thereto, Rafael
chronicled the discrepancy in the notarization of the second deed of sale
upon which said petition was premised and ultimately concluded that said
deed was a counterfeit or "at least not a public document which is sufficient to transfer real rights according to law."
Rafael insisted that said property was "absolutely sold and conveyed for a
consideration of P20,000.00, Philippine currency, and for other valuable
consideration". He insists that the sale was dacion en pago.
Issue: Whether or not the sale constitutes as a sale of dacion en pago.
Held: The late Rafael insisted that the sale to him of his uncle's property
was in fact a "dacion en pago" in satisfaction of Federico's unpaid attorney's fees, What prominently stands out from the mass of records, however, is the fact that this claim of the late Rafael was only raised in 1976
when he testified on direct examination. The answer that he filed in 1970
in response to Federico's complaint never mentioned nor even alluded to
any standing liability on the part of Federico as regards unpaid attorney's
fees. Neither did the late Rafael deny or refute Federico's testimony that
they did not have a clear-cut compensation scheme and that Federico
gave him money at times, which compensation enabled the late Rafael to
purchase his first car. The late Rafael even affirmed Federico's testimony
respecting his appointment as the legal counsel and corporate secretary
of the Hagonoy Rural Bank for which he received compensation as well.
The failure of the late Rafael to take exclusive possession of the property
allegedly sold to him is a clear badge of fraud. The fact that, notwithstanding the title transfer, Federico remained in actual possession,
cultivation and occupation of the disputed lot from the time the deed of
sale was executed until the present, is a circumstance which is unmistakably added proof of the fictitiousness of the said transfer, the same being
contrary to the principle of ownership.
According to the late Rafael, he allowed Federico to remain in the premises and enjoy the fruits thereof because of their understanding that Federico may subsequently repurchase the property. Contrary to what Rafael
thought, this in fact is added reason for simulation. The idea of allowing a
repurchase goes along the same lines posed by the theory of Federico.
If it were true that the first sale transaction was actually a "dacion en pago"
in satisfaction of Federico's alleged unpaid attorney's fees, it does strain
the logical mind that Rafael had agreed to allow the repurchase of the
property three months thereafter. Federico was obviously financially liquid.
Had he intended to pay attorney's fees, he would have paid Rafael in cash
and not part with valuable income-producing real property.
Sweedish Match vs. CA
Facts: The petitioner was selling their companies to prospective buyers,
respondent was one of them. The respondent went a letter to petitioner
saying that he is willing to buy at $36 million. Petitioner said it was too low
and urged respondent to reconsider. Petitioner gave respondent 2 weeks
to submit its final bid. During the two weeks, petitioner was negotiating
with other people, thus respondent said that its offer of $36 million was its
final bid. Petitioner sent a letter saying that it would give respondent 15
days which they will negotiate exclusively with respondent to negotiate a
better price. Respondent sued for specific performance compelling the
petitioner to deliver the shares.
Issue: WON there was a perfected contract of sale
Held: NO. There was no meeting of the minds on the price. Respondent
said that the manner of payment will have to be agreed upon, thus no
cause. Also the action is barred by the statute of frauds, the Court said
that the note evidencing the contract, the letter, must have all the requisites of a contract in them. In the case, the letters had no indication of the
manner of payment, thus barred.
UP vs. PHILAB
Facts: UP wanted to build a research complex called Biotech. For the
manufacturing of the equipment to be used in Biotech, FEMF orally contracted with Philab for the same. Philab began manufacturing the said
equipment without drafting a contract between them and FEMF. The
equipment was delivered to UP, and FEMF issued a check in favor of Philab. This method of payment was repeated 2 times, until only 700k was
left of the whole 2.6 million. FEMF didnt pay the outstanding balance despite repeated demands. FEMF now sues UP for the balance.
Issue: WON UP is liable
Held: No. UP was never the buyer of the equipment, it was FEMF. The
Court said that FEMF and Philab had an implied-in-fact contract of sale
which is a contract that is implied from the facts and circumstances showing a mutual intention to contract. Its a valid contract the existence and
terms of which are governed by the conduct of the parties. Philab knew it
contracted with FEMF and not UP. It never started fabricating until the
FEMF told it to. FEMF was always the one paying, not UP.