NICOLAS SANCHEZ, PLAINTIFF AND APPELLEE, VS.

SEVERINA RIGOS,
DEFENDANT AND APPELLANT.
DOCTRINE: An option contract without option money subsist until Seller manifests his
withdrawal and notifies Buyer, prior to the latters tender of payment.
FACTS:

Sanchez and Rigos entered into a contract of option to purchase a parcel of land in
Nueva Ecija. This gave Sanchez an option with a term of 2 years to decide whether he
would purchase the said land from Rigos for P1,510.

Sanchez tried to tender payment to Rigos several times, but Rigos continuously refused to
accept. This prompted Sanchez to deposit (consign) the amount with the CFI of Nueva
Ecija and filed a case for the enforcement of the sale (specific action plus dmages).

Rigos contented that the contract entered was one of which was a unilateral promise to
sell and since such option contract was not secured by consideration (option money) it is
not binding.

CFI ruled in favor of Sanchez and ordered Rigos to accept payment and pay costs.
ISSUE:
WON an option contract between Sanchez and Rigos may be binding even without option
money. (YES)
HELD:

This case admittedly hinges on the proper application of Article 1479 of our Civil Code,
which provides:
"ART. 1479. A promise to buy and sell a determinate thing for a price certain is
reciprocally demandable.
"An accepted unilateral promise to buy or to sell a determinate thing for a price
certain is binding upon the promissor if the promise is supported by a consideration
distinct from the price."

Sanzhez alleged that Rigos committed herself to sell the land to him, and he accepted.
Hence, Sanzhez is of the opinion the promise in the contract was reciprocally demandable
pursuant to the first paragraph of 1479.

Although Rigos had really "agreed, promised and committed" herself to sell the land to
the plaintiff, it is not true that the latter had, in turn, "agreed and committed himself" to
buy said property.

The option did not impose upon Sanchez the obligation to purchase Rigos' property.
Annex A is not a "contract to buy and sell." It merely granted Sanchez 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, Rigos "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 (no option money).
But the Supreme Court upheld that the contract between the parties was binding, and held
Rigos to be bound to accept the payment. It is true that there was no consideration
provided, but, such offer to sell was accepted by Sanchez and no signs of Rigos
withdrawing such offer, there exists a bilateral obligation.
The Supreme Court held in Atkins, Kroll and Co. Inc v. Cua Hian Tek, that in cases
similar to this, 1479 should be seen in line with article 1324.
Sa madaling salita There was an offer to sell by Rigos, which was accepted by
Sanchez. Following, 1324, this creates a bilateral obligation, but Rigos MAY
WITHDRAW anytime, absent any consideration.
But, since no notice of withdrawal was ever made, the offer to sell subsits HENCE,
Sanchezs payment was VALID and BINDING.

CONCURRING OPINION:
ANTONIO, J.:
I concur in the opinion of the Chief Justice.
I fully agree with the abandonment of the view previously adhered to in Southwestern Sugar &
Molasses Co. vs. Atlantic Gulf and Pacific Co. which holds that an option to sell can still be
withdrawn, even if accepted, if the same is not supported by any consideration, and the
reaffirmance of the doctrine in Atkins, Kroll & Co. Inc. vs. Cua Hian Tek, holding that "an
option implies * * * the legal obligation to keep the offer (to sell) open for the time specified;"
that it could be withdrawn before acceptance, if there was no consideration for the option, but
once the offer to sell" is accepted, a bilateral promise to sell and to buy ensues, and the
offeree ipso facto assumes the obligations of a purchaser. In other words, if the option is given
without a consideration, it is a mere offer to sell, which is not binding until accepted. If,
however, acceptance is made before a withdrawal, it constitutes a binding contract of sale.
The concurrence of both acts the offer and the acceptance could in such event generate a
contract.
While the law permits the offeror to withdraw the offer at any time before acceptance even
before the period has expired, some writers hold the view, that the offeror cannot exercise this
right in an arbitrary or capricious manner. This is upon the principle that an offer implies an
obligation on the part of the offeror to maintain it for such length of time as to permit the
offeree to decide whether to accept or not, and therefore cannot arbitrarily revoke the offer
without being liable for damages which the offeree may suffer. A contrary view would remove
the stability and security of business transactions. [3] In the present case the trial court found
that the "Plaintiff (Nicolas Sanchez) had offered the sum of P1,510.00 before any withdrawal
from the contract has been made by the Defendant (Severina Rigos)." Since Rigos' offer to sell
was accepted by Sanchez, before she could withdraw her offer, a bilateral reciprocal contract
to sell and to buy was generated.