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!"#$! &'($!)! *+,-. / +,-01 "))23 4"2 5"6#6 !

"7)'"(6


4"89$##$ "77$ (:)'$44$;
!"#" %&" ''(()* +,-. /01 '223

%445 6" 78

lalnLlffs: CCnCPl1A nCCL and CAuuLnClC ALMC!L8A (spouses)

uefendanL: CCu81 Cl ALALS, AnACLL1C nCCL (broLher of ConchlLa)
and LMlLlA nL88L

onenLe: anganlban, !"

CASL: vlcLorlno and lranclsco nool are owners of Lwo parcels of land ln
lsabela. ConchlLa nool and her spouse Caudenclo clalms LhaL Lhese
belong Lo Lhem because Lhey boughL. 1hey sald LhaL Lhey had
morLgaged lL wlLh u8, buL lL was foreclosed because Lhey were noL
able Lo pay. u8 Cfflcer, Manuel Mallorca, conflrmed LhaL u8 galned
absoluLe ownershlp of Lhe 2 lands because Lhe rlghL Lo redempLlon was
noL exerclsed. LaLer, boLh were sold Lo AnecleLo nool. ConchlLa and
Caudenclo clalms LhaL Lhey had asked AnecleLo Lo purchase Lhe land
from u8 for Lhem, buL Lhey had an agreemenL LhaL AnecleLo would buy
Lhe properLy for 100,000. AnacleLo was able Lo pay 30,000. Powever,
he and hls spouse, Lmllla nebre, were unable Lo pay Lhe balance of
14,000. ln Auul1lCn, ConchlLa clalms LhaL anoLher agreemenL was
made whereby AnecleLo would reLurn Lhe properLles Lo plalnLlffs
anyLlme LhaL Lhe plalnLlffs had Lhe money Lo redeem Lhe same.
uefendanLs on Lhe oLher hand, clalms LhaL Lhey boughL Lhe properLy
dlrecLly from u8 and were merely mlsled lnLo execuLlng a documenL
sLaLlng LhaL he would reLurn Lhe lands Lo plalnLlffs, because Lhey were
under Lhe bellef LhaL ConchlLa sLlll had Lhe rlghL Lo redeem Lhe same.

1he CourL ruled LhaL (1) Lhe documenLs glvlng plalnLlffs Lhe rlghL Lo
repurchase Lhe properLles from defendanLs were vold slnce plalnLlffs
dldn'L even have a rlghL Lo sell Lhe properLy, (2) plalnLlffs cannoL clalm
LhaL defendanLs clalm Lo ownershlp of Lhe lands ls esLopped because
Lhey had allowed plalnLlffs Lo culLlvaLe 2 hecLares of lL, and (3)
eLlLloners musL reLurn Lhe 30,000 pald Lo Lhem, wlLh correspondlng
lnLeresL.

uCC18lnLS:
1hose who do noL own Lhe properLy have no rlghL Lo allenaLe
Lhe same. Any conLracL of such ls vold and cannoL be raLlfled aL
all. (lssue 1)
LsLoppel ls noL appllcable ln cases LhaL lmpugn Lhe valldlLy of
conLracLs (lssue 2)
lf a vold conLracL has already been performed, Lhe resLoraLlon
of whaL has been glven ls ln order. (lssue 3)

987:!#4;%<=
1wo parcels of land ln San Manuel, lsabela are Lhe sub[ecL
o 1 hecLare owned by vlcLorlno nool
o 3.0880 hecLares owned by lranclsco nool
ConchlLa, vlcLorlno, lranclsco and AnacleLo are slbllngs.
ConchlLa and Caudenclo allege LhaL Lhey boughL Lhe lands
owned by vlcLorlno and lranclsco.
Powever, Lhey were ln dlre need of money so Lhey morLgaged
Lhe lands Lo Lhe uevelopmenL 8ank of Lhe hlllpplnes ln llagan,
lsabela. AL LhaL Llme, Lhe LlLles of boLh properLles were sLlll
under Lhe names of vlcLorlno and lranclsco. lalnLlffs falled Lo
pay Lhelr loan (36,000 LoLal) so Lhe morLgage was foreclosed.
Manuel S. Mallorca, auLhorlzed offlcer of u8, cerLlfled LhaL Lhe
on 1-year redempLlon perlod was from March 16, 1982 Lo
March 13, 1983 and LhaL Lhe morLgagors' rlghL of redempLlon
was noL exerclsed wlLhln Lhls perlod. Pence, u8 became Lhe
absoluLe owner of sald parcels of land
lalnLlffs approached AnacleLo Lo redeem Lhe properLy from
u8.
o Aprll 1, 1983 ! u8 enLered lnLo a ueed of CondlLlonal
Sale lnvolvlng Lhe same parcels of land wlLh AnacleLo
nool as vendee. SubsequenLly, Lhe laLLer was lssued
new cerLlflcaLes of LlLle on lebruary 8, 1988.
!"#$! &'($!)! *+,-. / +,-01 "))23 4"2 5"6#6 !"7)'"(6


4"89$##$ "77$ (:)'$44$;
An arrangemenL happened beLween plalnLlffs and defendanLs
whereby AnacleLo agreed Lo buy from ConchlLa Lhe 2 parcels of
land under conLroversy, for 100,000.00. Cf Lhls, 30,000.00
was pald Lo ConchlLa. upon paymenL of Lhe balance of
14,000.00, Lhe plalnLlffs were Lo regaln possesslon of Lhe 2
hecLares of land, whlch amounLs spouses AnacleLo nool and
Lmllla nebre (defendanLs) falled Lo pay.
Cn Lhe same day Lhe sald arrangemenL was made, anoLher
covenanL was enLered lnLo by Lhe parLles, whereby Lhe
defendanLs agreed Lo reLurn Lo plalnLlffs Lhe lands ln quesLlon,
aL anyLlme Lhe plalnLlffs have Lhe money Lo redeem Lhe same.
Powever, desplLe repeaLed demands and even help from Lhe
8rgy. CapLaln, defendanLs dld noL reLurn Lhe land.
uefendanLs Lheorlzed LhaL Lhey acqulred Lhe lands ln quesLlon
from u8 Lhrough negoLlaLed sale. 1hey were merely mlsled by
plalnLlffs when AnacleLo nool slgned Lhe prlvaLe wrlLlng where
he agreed Lo reLurn sub[ecL lands when plalnLlffs have Lhe
money Lo redeem Lhe same because he was made Lo belleve
LhaL ConchlLa sLlll had Lhe rlghL Lo redeem Lhe sald properLles.
%4>?=
?@ABCBD 7 ! a prlvaLe handwrlLLen documenL labeled by Lhe
parLles as 8eslbo Ll kaLulagan or 8ecelpL of AgreemenL, Lhe
peLlLloners appear Lo have "sold" Lo prlvaLe respondenLs Lhe
parcels of land ln conLroversy.
?@ABCBD < ! a prlvaLe handwrlLLen documenL ln llocano and
labeled as kasuraLan, prlvaLe respondenLs agreed LhaL ConchlLa
nool "can acqulre back or repurchase laLer on sald land when
she has Lhe money" (alleged conLracL Lo repurchase)

EFF;?F >4 9? #?F45G?<=
1. WheLher or noL Lhe CA mlsapplled Lhe legal lmporL or meanlng
of LxhlblL "C" ln a way conLrary Lo law and exlsLlng
[urlsprudence ln sLaLlng LhaL lL has no blndlng effecL beLween
Lhe parLles and consldered valldly wlLhdrawn by defendanLs-
appellees for wanL of conslderaLlon.
2. WheLher or noL Lhe CA falled Lo glve legal slgnlflcance Lo Lhe
acLual possesslon and culLlvaLlon and approprlaLlng excluslvely
Lhe palay harvesL of Lhe 2 hecLares land pendlng Lhe paymenL of
Lhe remalnlng balance of 14,000 by defendanLs as lndlcaLed ln
LxhlblL "C".
3. WheLher or noL Lhe CA serlously erred ln afflrmlng Lhe declslon
of Lhe lower courL by awardlng Lhe paymenL of renLs per annum
and Lhe reLurn of 30,000 and noL allowlng Lhe plalnLlffs Lo re-
acqulre Lhe 4 hecLares, more or less upon paymenL of 100,000
as shown ln LxhlblL "u".

#?F45;>E4%F 8%< 8#!;H?%>F
EFF;? ' ! WheLher or noL Lhe CA mlsapplled Lhe legal lmporL or
meanlng of LxhlblL "C" ln a way conLrary Lo law and exlsLlng
[urlsprudence ln sLaLlng LhaL lL has no blndlng effecL beLween Lhe parLles
and consldered valldly wlLhdrawn by defendanLs-appellees for wanL of
conslderaLlon. ! nC. 1he prlnclpal conLracL of sale conLalned ln LxhlblL
C and Lhe auxlllary conLracL of repurchase ln LxhlblL u are boLh vold.

Ma[or olnL 1: Sellers no longer had any LlLle Lo Lhe parcels of land aL
Lhe Llme of sale, and evldence showed LhaL defendanLs boughL Lhe lands
dlrecLly from u8 afLer dlscoverlng LhaL peLlLloners dld noL own Lhem.
8IDBJ-K '0//1 7B6B- 7&LK: "(a) conLracL whlch ls Lhe dlrecL resulL
of a prevlous lllegal conLracL, ls also vold and lnexlsLenL."
o Slnce LxhlblL u was dependenL on Lhe valldlLy of LxhlblL
C, lL ls lLself vold. A vold conLracL cannoL glve rlse Lo a
valld one.
8IDBJ-K '0*2 7B6B- 7&LK: "Lhe vendor musL have a rlghL Lo
Lransfer Lhe ownershlp Lhereof [ob[ecL of Lhe sale] aL Lhe Llme lL
ls dellvered."
o Pere, dellvery of ownershlp ls no longer posslble. lL has
become lmposslble.
8IDBJ-K '*M* 7B6B- 7&LK: "where goods are sold by a person who
ls noL Lhe owner Lhereof, and who does noL sell Lhem under
auLhorlLy or wlLh consenL of Lhe owner, Lhe buyer acqulres no
!"#$! &'($!)! *+,-. / +,-01 "))23 4"2 5"6#6 !"7)'"(6


4"89$##$ "77$ (:)'$44$;
beLLer LlLle Lo Lhe goods Lhan Lhe seller had, unless Lhe owner of
Lhe goods ls by hls conducL precluded from denylng Lhe seller's
auLhorlLy Lo sell."
o Pere, Lhere ls no allegaLlon aL all LhaL peLlLloners were
auLhorlzed by u8 Lo sell Lhe properLy Lo Lhe prlvaLe
respondenLs.

Ma[or olnL 2: ConLracL of repurchase ls dependenL on Lhe valldlLy of
Lhe sale.
Assumlng $%&'()*+ LhaL LxhlblL u ls separaLe and dlsLlncL from
LxhlblL C and Lherefore noL affecLed by Lhe nulllLy of Lhe laLLer,
peLlLloners sLlll do noL acqulre a rlghL Lo repurchase. lnsLead,
LxhlblL u becomes an accepLed unllaLeral promlse Lo sell.
8IDBJ-K '0321 7B6B- 7&LK: "an accepLed unllaLeral promlse Lo buy
or sell a deLermlnaLe Lhlng for a prlce cerLaln ls blndlng upon
Lhe promlssor lf Lhe promlse ls supporLed by a conslderaLlon
dlsLlncL from Lhe prlce."
o Pere, Lhe alleged wrlLLen conLracL of repurchase
conLalned ln LxhlblL u ls berefL of any conslderaLlon
dlsLlncL from Lhe prlce. Accordlngly, as an lndependenL
conLracL, lL cannoL blnd prlvaLe respondenLs.
8amos, eL al. vs. lcaslano, eL al. ! an agreemenL Lo repurchase
becomes a promlse Lo sell when made afLer Lhe sale. 8ecause
when Lhe sale ls made wlLhouL such an agreemenL, Lhe
purchaser acqulres Lhe Lhlng sold absoluLely and lf he
afLerwards granLs Lhe vendor Lhe rlghL Lo purchase, lL ls a new
conLracL enLered lnLo by Lhe purchaser, as absoluLe owner
already of Lhe ob[ecL.

Ma[or olnL 3: 8lghL Lo repurchase based on homesLead or LrusL ls non-
exlsLenL ln Lhls case.
FKJ" ''21 N,C-BJ 5OPL 8JD: "(e)very conveyance of land acqulred
under Lhe free paLenL or homesLead provlslons, when proper,
shall be sub[ecL Lo repurchase by Lhe appllcanL, hls wldow or
legal helrs, wlLhln a perlod of flve years from Lhe daLe of
conveyance."
o Clalm on homesLead: lranclsco, vlcLorlno, ConchlLa and
AnacleLo nool were all slbllngs and helrs quallfled Lo
repurchase Lhe Lwo parcels of land. Slnce AnacleLo
exerclsed Lhe rlghL Lo repurchase, lL can no longer be
exerclsed by Lhe oLher Lhree.
eLlLloners clalm LhaL AnacleLo purchased Lhe lands from u8 ln
LrusL for peLlLloners.
o 1he facL LhaL AnacleLo nool was Lhe younger broLher of
ConchlLa nool and LhaL Lhey slgned a conLracL of
repurchase (whlch vold), does noL prove Lhe exlsLence
of an lmplled LrusL ln favor of peLlLloners.

EFF;? / ! WheLher or noL Lhe CA falled Lo glve legal slgnlflcance Lo Lhe
acLual possesslon and culLlvaLlon and approprlaLlng excluslvely Lhe palay
harvesL of Lhe 2 hecLares land pendlng Lhe paymenL of Lhe remalnlng
balance of 14,000 by defendanLs as lndlcaLed ln LxhlblL "C". ! nC.
LsLoppel ls noL appllcable ln cases LhaL lmpugn Lhe valldlLy of conLracLs.

Ma[or olnL 1: A vold conLracL can never be raLlfled.
eLlLloners argue LhaL when AnacleLo Look Lhe possesslon of Lhe
2 hecLares, and leL Lhe oLher 2 hecLares Lo be occupled and
culLlvaLed by plalnLlffs, he cannoL laLer on dlsclalm Lhe Lerms
agreed upon and hls acLuaLlon ls wlLhln Lhe amblL of esLoppel.
8IDBJ-K '0'M 7B6B- 7&LK: "(L)he acLlon or defense for Lhe
declaraLlon of Lhe lnexlsLence of a conLracL does noL prescrlbe.
lL ls lmmaLerlal LhaL prlvaLe respondenLs lnlLlally acLed Lo
lmplemenL Lhe conLracL of sale, bellevlng ln good falLh LhaL Lhe
same was valld. A vold conLracL can never be raLlfled.

EFF;? ) ! WheLher or noL Lhe CA serlously erred ln afflrmlng Lhe
declslon of Lhe lower courL by awardlng Lhe paymenL of renLs per
annum and Lhe reLurn of 30,000 and noL allowlng Lhe plalnLlffs Lo re-
acqulre Lhe 4 hecLares, more or less upon paymenL of 100,000 as
!"#$! &'($!)! *+,-. / +,-01 "))23 4"2 5"6#6 !"7)'"(6


4"89$##$ "77$ (:)'$44$;
shown ln LxhlblL "u". ! nC. eLlLloners are Lhe ones who have an
obllgaLlon Lo reLurn whaL Lhey unduly and lmproperly recelved by
reason of Lhe lnvalld conLracL of sale. Slnce Lhey cannoL legally glve LlLle
Lo whaL Lhey "sold," Lhey cannoL keep Lhe money pald for Lhe ob[ecL of
Lhe sale.

Ma[or olnL 1: lf a vold conLracL has already been performed, Lhe
resLoraLlon of whaL has been glven ls ln order.
lnLeresL wlll run only from Lhe Llme of prlvaLe respondenLs'
demand for Lhe reLurn of Lhls amounL ln Lhelr counLerclalm.
eLlLloners' possesslon and culLlvaLlon of Lhe 2 hecLares are
anchored on prlvaLe respondenLs' Lolerance. Clearly, Lhe laLLer's
Lolerance ceased upon Lhelr counLerclalm and demand on Lhe
former Lo vacaLe. Pence, Lhelr rlghL Lo possess and culLlvaLe Lhe
land lpso facLo ceased.

QE%85 G?#<E7>= LxhlblL C and u are vold and Lherefore noL blndlng. As
such, plalnLlffs musL reLurn whaL money Lhey have recelved as paymenL
from defendanLs.

%4 F?N8#8>? 4NE%E4%F