GONZALES vs.

HEIRS OF THOMAS AND PAULA CRUZ

G.R. No. 131784, September 16, 1999

Facts: Petitioner Gonzales entered into a Contract of Lease/Purchase with the

heirs of Thomas and Paula Cruz. Based on the said contract, the petitioner was
given an option to purchase the leased property after the expiration of the one-year
lease. The option was subject to a condition contained in par. 9 of the Contract
which provided that: The LESSORS (heirs) x x x shall undertake to obtain a
separate and distinct TCT over the leased portion to the LESSEE within a reasonable
period of time which shall not in any case exceed 4 years, x x x. After the
expiration of the lease, petitioner Gonzales did not exercise his option to purchase
the property. He remained in possession without paying the purchase price.
Alleging breach of the provisions of the Contract, the heirs filed a complaint for the
recovery of possession of the property. For his part, the petitioner defended that
there was no breach since the heirs had not yet registered the leased property in
their names in accordance with par. 9 of the Contract.

Issues: Whether or not the obligation was subject to a condition

Held: YES.
The clear intent of the 9th par. was for respondents to obtain a separate and
distinct TCT in their names. This was necessary to enable them to show their
ownership of the stipulated portion of the land and their concomitant right to
dispose of it. It is a well-settled principle in law that no one can give what one
does not have nemo dat quod non habet.

Accordingly, one can sell only what one owns or is authorized to sell, and the
buyer can acquire no more that what the seller can transfer legally. Because the
9th clause required respondents to obtain a separate and distinct TCT in their
names and not in the name of petitioner, it logically follows that such under
taking was a condition precedent to the latters obligation to purchase and pay
for the land.

Put differently, petitioners obligation to purchase the land is a conditional one

and is governed by Article 1181 of the Civil Code. Condition has been defined as
every future and uncertain event upon which an obligation or provision is made
to depend. Without it, the sale of the property under the Contract cannot be
perfected, and the petitioner cannot be obliged to purchase the property. The
obligatory force of a conditional obligation is subordinated to the happening of a
future and uncertain event, so that if that event does not take place, the parties
would stand as if the conditional obligation had never existed.