Yturralde vs.
CA Ernesto, Fortunata, Montano, Guadalupe, Luis and Rosalia, all
FACTS:
Spouses Francisco Yturralde and Margarita de los Reyes,
owned a parcel of agricultural land located in Guilinan, Tungawan,
Zamboanga del Sur, containing an area of 14.1079 hectares, more
or less, and registered in their names under Original Certificate of
Title No. 2356 of the Office of the Register of Deeds of Zamboanga
del Sur. Sometime in the year 1944, Francisco Yturralde died
intestate, survived by his wife, Margarita de los Reyes, and their
children who are the petitioners herein, Ernesto, Fortunata,
Montano, Zosimo, Ramon, Guadalupe, Luis, Josefina and Rosalia, all
surnamed Yturralde. In 1950, Margarita de los Reyes contracted a
second marriage with her brother-in-law and uncle of the
petitioners herein, Damaso Yturralde .
On May 30, 1952, Damaso Yturralde and Margarita de los Reyes
executed a deed of sale with right of repurchase in favor of the
respondent herein, Isabelo Rebollos, covering the above-mentioned
property in consideration of the sum of P1,715.00. The vendors a
retro failed to exercise the right to repurchase the property within
the three-year period agreed upon, which expired on May 30, 1955.
In 1961, Margarita de los Reyes died.
On May 3, 1965, the respondent, Isabelo Rebollos, filed a petition
for consolidation of ownership with the Court of First Instance of
Zamboanga del Sur, docketed as Civil Case No. 436 therein, naming
as respondents in the case the petitioners herein and Damaso
Yturralde (Annex A, Petition). Summons was then issued, and
received on June 17, 1965 by the respondent therein, Damaso,
surnamed Yturralde (Annexes C and F, Petition). However,
summons could not be served on three of the respondents therein,
Josefina, Zosima and Ramon Yturralde, as they were no longer
residing at their last known addresses (Annexes B, C and F, Petition).
The Judge then presiding the Court of First Instance of Zamboanga
del Sur, Hon. Dimalanes Buissan, in his order dated October 7, 1965,
directed that summons be served upon the said three respondents
therein (Annex C, Petition). On November 20, 1965, the Court
rendered a decision consolidating the ownership of the subject
property in favor of Rebollos, and ordering the Register of Deeds of
Zamboanga del Sur to cancel Original Certificate of Title No. 2356
covering said property and, in lieu thereof, to issue a transfer
certificate of title in the name of Rebollos (Annex H, Petition).
Issue:
Whether the requirements for consolidation of ownership
by vendee a retro had been complied with?
Held:
Unlike the old Civil Code, Article 1607 of the new Civil Code of 1950
provides that consolidation of ownership in the vendee a retro of
real property by virtue of the failure of the vendor a retro "to
comply with the provisions of Article 1616 shall not be recorded in
the Registry of Property without a judicial order, after the vendor
has been duly heard." In the case of Teodoro vs. Arcenas, 1 this
Court, through Mr. Justice Jose B. L. Reyes, ruled that under the
aforesaid Article 1607 of the new Civil Code, such consolidation
shall be effected through an ordinary civil action, not by a mere
motion, and that the vendor a retro should be made a party
defendant, who should be served with summons in accordance with
Rule 14 of the Revised Rules of Court; and that the failure on the
part of the court to cause the service of summons as prescribed in
Rule 14, is sufficient cause for attacking the validity of the judgment
and subsequent orders on jurisdictional grounds. 2 The Court in said
case stressed that the reason behind the requirement of a judicial
order for consolidation as directed by Article 1067 of the new Civil
Code is because "experience has demonstrated too often that many
sales with right of re-purchase have been devised to circumvent or
ignore our usury laws and for this reason, the law looks upon them
with disfavor (Report of the Code Commission, pp. 63-64). When,
therefore, Article 1607 speaks of a judicial order after the vendor
shall have been duly heard, it contemplates none other than a
regular court proceeding under the governing Rules of Court,
wherein the parties are given full opportunity to lay bare before the
court the real covenant. Furthermore, the obvious intent of our Civil
Code, in requiring a judicial confirmation of the consolidation in the
vendee a retro of the ownership over the property sold, is not only
to have all doubts over the true nature of the transaction speedily
ascertained, and decided, but also to prevent the interposition of
buyers in good faith while such determination is being made. Under
the former method of consolidation by a mere extrajudicial affidavit
of the buyer a retro, the latter could easily cut off any claims of the
seller by disposing of the property, after such consolidation, to
strangers in good faith and without notice. The chances of the seller
a retro to recover his property would thus be nullified, even if the
transaction were really proved to be a mortgage and not a sale."
Paredes v. Espino, 22 SCRA 1000
FACTS:
Paredes had filed an action to compel defendant-appellee Espino to
execute a deed of sale and to pay damages. The complaint alleged
that the defendant "had entered into the sale" to plaintiff of a lot;
that the deal had been "closed by letter and telegram" but the
actual execution of the deed of sale and payment of the price were
deferred to the arrival of defendant at Puerto Princesa; that
defendant upon arrival had refused to execute the deed of sale
although plaintiff was able and willing to pay the price, and
continued to refuse despite written demands of plaintiff
ISSUE:
Whether or not it is barred by Statute of Frauds?
HELD:
The letter showing all the essential elements of a contract of sale
was an adequate memorandum of the transaction to remove it
from the operation of the Statute of Frauds. The case was
remanded to the lower court for decision.
Laperal vs. Rogers
Facts:
Roberto Laperal sold his property to the Japanese Military
Controlled Republic of the Philippines for the sum of P.500,000 in
Japanese Military War notes. When Japanese occupation was over,
Laperal filed an action for recovery of hisproperty with the alien
property custodian alleging that the sale took place during the
Japanese regime amd was madeunder duress and the consideration
was grossly inadequate. The trial court ruled in favor of Laperal.
Laperal’s contention:
The main allegations of the complaint were that appellee executed
the deed of sale of April 12, 1944 in favor of theoccupation Republic
of the Philippines under duress and due to the threats employed by
the representatives of theJapanese Military Administration, and
that the consideration of P500,000.00 in Japanese Military notes
wasgrossly inadequate.
Respondent’s contention:
The Philippine Alien Property Administrator denied, for lack of
knowledge and information, plaintiff’s allegationsconcerning the
circumstances under which the sale of the property was allegedly
made. The Register of Deeds of Manila was declared in default due
to his failure to answer the complaint within the reglementary
period.
Issue:
Was the deed of sale executed under duress that the contract can
be nullified?
Held:
With respect to the first issue, the lower court found on the basis of
the evidence before it, that the sale was executedunder duress.(1) It
is of common knowledge that, during the second world war, the
Japanese army of occupation in the Philippines, didoccupy and take
private properties in the City of Manila and elsewhere in the
country without the consent of theirrespective owners, for their use
in the prosecution of the war, resorting in some cases to the
expedient of making theowners execute deeds of sale or contracts
of lease;(2) It is not denied that appellee, before the war and at the
time of the execution of the questioned sale, was a very richman
with extensive real state holdings principally in Manila. The record
discloses in this connection, that from 1914 up tothe date of the
sale, he had not disposed of a single property by sale. The record
further shows that at the time of the sale,he was in possession of a
considerable amount of money, both in genuine Philippine currency
and in Japanese military notes. Highly solvent as he was at the time,
it was improbable – to say the least – that he would dispose of such
valuableproperty as the one in question. If he had been in need of
money at all, he would probably have sold some other much
lessdesirable property. One may believe that the sale in question
was voluntary only by assuming that Laperal sold theproperty
involved to collaborate in the attainment of the ends pursued by
the Japanese army of occupation – anassumption completely
unjustified in this case in view of the absolute absence of evidence,
direct or indirect, that Laperalcollaborated or had ever intended to
collaborate with the enemy.(3)
The consideration paid for the property, namely the sum of
P500,000.00 in Japanese military notes, was grossly inadequate.
It has been agreed, for the purpose of this case, that at the time of
the sale (April 1944), a pre- war Philippine peso was worth fourteen
Japanese military pesos. On the other hand, the evidence of record
shows that thepre-war assessed value of the property in question
was P92,995.00 which, if reduced to its equivalent value in terms of
Japanese military notes as of April 1944, would have amounted to
around P1,300.000.00 (Japanese military notes). Wemust also
consider the fact that the pre-war assessed value of the property
did not represent its real or actual value whichcould easily be
around P200,000.00.

Reduced to its equivalent in Japanese military notes, this would

havemeant around P2,800,000.00. Instead, he was merely paid
P500,000.00 in Japanese military notes, orthe equivalent of
something around P35,000.00, Philippine currency, at the time.