41.

LIMKETKAI AND SONS MILLING VS CA

Facts:
The BPI came to an agreement with the buyer over a parcel of land at an agreed
price of 1,000 per square meters to be paid in cash.
otwithstanding the !nal agreement, the buyer inquired if it was possible to pay on
credit terms the purchase price. The BPI representative stated that there was no
harm in trying to as" for payment on terms because in previous transactions, the
same had been allowed by the BPI board.
# couple of days later, the BPI informed the buyer that the lot was no longer for
sale.
The buyer brought an action for speci!c performance against BPI which claimed that
with the o$er to pay the purchase price in credit terms, there was no perfected sale.
Issue:
%hether or not there is a perfected contract of sale
Held:
The court held that there was a perfected contract of sale between the BPI and the
buyer there having been mutual consent between parties, the sub&ect matter was
de!nite, and the consideration was determined.
Villoco Doct!ie ' (It is true that an acceptance may contain a request for certain
changes in terms of the o$er and yet be a binding acceptance. )o long as it is clear
that the meaning of the acceptance is positively and unequivocally to accept the
o$er, whether such request is granted or not, a contract is formed*
4". DELA CAVADA VS CA
Facts:
+ela ,avada and +ia- made an .ption ,ontract where +ia- promised to sell his
/acienda de Pitogo together with his coconut and nipa palm trees for 00,000 and
10,000 respectively.
The contract provides that +ela ,avada has the right to purchase the land until
after +ia- acquires it2s Torrens title.
+ia- applied two land titles for the hacienda dividing it into two parts. #fter the titles
have been issued, +ia- o$ers to sell to +ela ,avada only a portion of the entire
hacienda.
Issue:
%hether or not +ia- is obliged to sell the entire hacienda to +ela ,avada
Held:
# promise made by one party, if made in accordance with the forms required by the
law, may be a good consideration 3causa4 for a promise made by another party.
The contract is complete, provided they have complied with the forms required by
the law and the consideration need not be paid at the time of the promise.
The plainti$ stood ready to comply with his part of the contract. The defendant,
even though he had obtained a registered title to said parcel of land, refused to
comply with his promise.
The contract was not, in fact, what is generally "nown as a 5contract of option.5 It
di$ers very essentially from a contract of option. #n optional contract is a privilege
e6isting in one person, for which he had paid a consideration, which gives him the
right to buy, for e6ample, certain merchandise of certain speci!ed property, from
another person, if he chooses, at any time within the agreed period, at a !6ed price.
The contract is already in the perfected stage.
4#. ADELFA $%O$E%TIES VS CA
Facts:
Private respondents and their brothers 7ose and +ominador were the registered ,.8
.%9:) of a parcel of land in ;as Pinas, covered by a T,T.
7ose and +ominador sold their share 3eastern portion of the land4 to #delfa.
Thereafter, #delfa e6pressed interest in buying the western portion of the property
from private respondents herein. #ccordingly, an (e6clusive .ption to Purchase*
was e6ecuted between #delfa and Private respondents and an option money of
<0,000 was given to the latter.
# new owner2s copy of the certi!cate of title was issued 3as the copy with
respondent )alud was lost4 was issued but was "ept by #delfa2s counsel, #tty.
Bernardo.
Before #delfa could ma"e payments, it received summons as a case was !led 3:T,
=a"ati4 against 7ose and +ominador and #delfa, because of a complaint in a civil
case by the nephews and nieces of private respondents herein. #s a consequence,
#delfa, through a letter, informed the private respondents that it would hold
payment of the full purchase price and suggested that they settle the case with
their said nephews and nieces. )alud did not heed the suggestion> respondent2s
informed #tty. Bernardo that they are canceling the transaction. #tty Bernardo made
o$ers but they were all re&ected.
:T, =a"ati dismissed the civil case. # few days after, private respondents e6ecuted
a +eed of ,onditional )ale in favor of ,hua, over the same parcel of land.
#tty Bernardo wrote private respondents informing them that in view of the
dismissal of the case, #delfa is willing to pay the purchase price, and requested that
the corresponding deed of #bsolute )ale be e6ecuted. This was ignored by private
respondents.
Private respondents sent a letter to #delfa enclosing therein a chec" representing
the refund of half the option money paid under the e6clusive option to purchase,
and requested #delfa to return the owner2s duplicate copy of )alud. #delfa failed to
surrender the certi!cate of title, hence the private respondents !led a civil case
before the :T, Pasay, for annulment of contract with damages. The trial court
directed the cancellation of the e6clusive option to purchase. .n appeal, respondent
,# a?rmed in toto the decision of the :T, hence this petition.
Issue: %. the agreement between #delfa and Private :espondents is an option
contract
Held: @es, an option is a continuing ofer or contract by which the owner stipulates
with another that the latter shall have the right to buy the property at a ! 6ed price
within a certain time, or under, or in compliance with, certain terms and conditions,
or which gives to the owner of the property the right to sell or demand a sale. It is
also sometimes called an (unaccepted o$er*
It is simply a contract by which the owner of property agrees with another person
that he shall have the right to buy his property at a !6ed price within a certain time.
44. VILLAMO% VS CA
Facts:
The buyers previously bought one8half of the parcel of land from the sellers at an
agreed price of <10.00 per square meter. )ubsequently, a deed of option was
e6ecuted between the same parties over the other half with an e6press provision
therein that the only reason why the buyers earlier agreed to purchase the !rst half
at that high price was because of the underta"ing of the sellers to sell the other half
later also at the same price. %hen the deed of option was sought to be e6ercised
thirteen years later, it was interposed by the sellers8o$erors that the option was
void for lac" of consideration separate and distinct from the purchase price
stipulated.
Issue:
Held:
The )upreme ,ourt held that the consideration of the deed of option is (the why of
the contracts, the essential reason which moves the contracting parties to enter
into the contract.*AB It held that the cause or the impelling reason on the part of
the buyers8o$erees in e6ecuting the deed of option as appearing in the deed itself
was the sellers8o$erors2 having agreed to buy the original half of the land at <10.00
per square meter (which was greatly higher than the actual reasonable prevailing
price,*A1 and that such cause or consideration is clear from the deed itself. ote
that the separate consideration under the option was in fact an integral part of the
higher price they paid originally for the !rst parcel of land bought, which the ,ourt
considered to be !ne, so long as it was not part of the price to be paid for the other
parcel of land.
4&. SO%IANO VS 'A(TISTA
Facts:
seller )oriano entered into an agreement with C# for the former to sell and deliver
and
for the latter to purchase a ma6imum of D,BA0 cavans of palay which was to be
harvested from the sellers farmland, pursuant to the requirements of Pres. +ecree
o. A which authori-ed the C# to purchase palay grains from quali! ed farmers.
The following day seller )oriano delivered B00 cavans of palay to C#.
)ubsequently, C# refused to ma"e payments pending
the investigation being conducted showing that the seller was not a bona fde
farmer and the palay delivered by him was merely ta"en from the warehouse of a
rice trader, and he was later on advised to ta"e bac" the B00 cavans of palay
delivered by him. )eller )oriano ! led the action to demand speci! c performance
against C# to pay him the price of the palay delivered.
Issue:
Held:
)oriano initially o$ered to sell palay grains produced in his farmland to C#. %hen
the latter accepted the o$er by noting in )oriano2s Earmer2s Information )heet a
quota of D,BA0 cavans, there was already a meeting of the minds between the
parties. The object of the contract, being the palay grains produced in Sorianos
farmland and the [!"# was to pay the same depending upon its $uality. The fact
that the e%act number of cavans of palay to be delivered has not been determined
does not afect the perfection of the contract.A< #rticle 10AF of the ew ,ivil ,ode
providesG (... The fact that the quantity is not determinate shall not be an obstacle
to the e6istence of the contract, provided it is possible to determine the same,
without the need of a new contract between the parties.* In this case, there was no
need for HC#I and )oriano to enter into a new contract to determine the e6act
number of cavans of palay to be sold. )oriano can deliver so much of his produce as
long as it does not e6ceed D,BA0 cavans.
4). DI*ON VS CA
Facts:
.n 1F1A, Private respondent .verland 96press ;ines, Inc 3lessee4 entered into a
,ontract of ;ease with .ption to Buy with petitioners 3lessors4 involving a land
situated at Jue-on ,ity for one 314 year. +uring that period the respondent was
granted an option to purchase the land. 1F1B, for failure of lessee to pay the rentals
the petitioners !led an action for e&ectment. The ,ity ,ourt rendered &udgment
ordering lessee to vacate the leased premises and to pay the rentals in arrears and
damages with interests. ;essee !led a petition en&oining the enforcement of said
&udgment and dismissal of the case for lac" of &urisdiction. )uch petition was denied.
Thereafter, lessee !led for an action for speci!c performance to compel the
e6ecution of a deed of sale pursuant to the option to purchase and the receipt of the
partial consideration given to #lice +i-on and for the !6ing of period to pay the
balance. :espondent ,ourt of #ppeals rendered a decision upholding the &urisdiction
of ,ity ,ourt and concluding that there was a perfected contract of sale between
the parties due to the said partial payment. Petitioner2s motion for reconsideration
was denied by the respondent ,ourt.
Issue:
%hether or not there is a perfected contract of sale
Held:
There was no perfected contract of sale between the parties. In herein case, the
lessee gave the money to #lice +i-on in an attempt to resurrect the lapsed
option.The basis for agency is representation and a person dealing with an agent is
put upon inquiry and must discover upon his peril the authority of the agent. /ere,
there was no showing that petitioners consented to the act of #lice +i-on nor
authori-ed her to act on their behalf with regard to her transaction with the lessee.
Therefore, one of the essential elements for a contract of sale to be perfected is
lac"ing, which is consent.
#ll three elements of consent, sub&ect matter and consideration must be present for
a valid sale to e6ist> and that in a situation where any of the elements is not
present, (HtIthere was no perfected contract of sale,*1A and that (the absence of
any of these essential elements negates the e6istence of a perfected contract of
sale,* rather than using the technical term (void.*
4+. SANCHE* VS %IGOS
FACTS:
icolas )anche- and )everina:igos e6ecuted an instrument entitled 5.ption to
Purchase,5 whereby =rs. :igos agreed, promised and committed to sell to )anche-
a parcel of land within two 3D4 years from said date with the understanding that said
option shall be deemed terminated and elapsed if )anche- shall fail to e6ercise his
right to buy the property within the stipulated period. Inasmuch as several tenders
of payment made by )anche- within said period, were re&ected by =rs. :igos, on
=arch 1D, 1FB0, the former deposited said amount with the ,ourt of Eirst Instance
of ueva 9ci&a and commenced against the latter the present action, for speci!c
performance and damages.
:igos contended that the contract between them was only aunilateral promise to
sell, and the same being unsupported by any valuable consideration, by force of the
ew ,ivil ,ode, is null and void.
)anche- alleged in his compliant that, by virtue of the option under consideration,
5defendant agreed and committed to sell5 and 5the plainti$ agreed and committed
to buy5 the land described in the option.
The lower court rendered &udgment in favor of )anche- and ordered :igos to accept
the sum )anche- &udicially consigned, and to e6ecute in his favor the requisite deed
of conveyance.
ISS(E:
%hether there was a contract to buy and sell between the parties or only a
unilateral promise to sell.
Held:
The )upreme ,ourt a?rmed the lower court2s decision.
The instrument e6ecuted in 1FB1 is not a 5contract to buy and sell,5 but merely
granted )#,/9K an option to buy, as indicated by its own title 5.ption to
Purchase.5 The option did not impose upon )anche- the obligation to purchase
:igosL property. :igos 5agreed, promised and committed5 herself to sell the land to
)anche-, but there is nothing in the contract to indicate that her aforementioned
agreement, promise and underta"ing is supported by a consideration 5distinct from
the price5 stipulated for the sale of the land.
#rticle 1A1F refers to 5an accepted unilateral promise to buy or to sell.5 )ince 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 parta"es, however, of the nature of an o$er to sell
which, if accepted, results in a perfected contract of sale.
4,. MONTILLA VS CA ad A!a-o
Facts:
+efendant !led an action against =ontilla for failing to comply with his obligation to
sell a piece of land located in Iloilo ,ity in accordance to the parties verbal contract.
The price of the said lot as stipulated is P<1,B<0.00 3<0 PhpMsqm4, with the condition
that #ragon constructed on the lot a house of strong materials and paid a nominal
monthly rental in the meantime, to which was complied with by #ragon.
=ontilla denied ever having entered into such agreement, and set up the a?rmative
defenses ofG
1.4 unenforceability of the alleged agreement under the )tatute of Erauds
D.4 Eailure of the complaint to state a cause of action, no allegation having been
made therein of any consideration for the promise to sell distinct and separate from
the price, as required by #rticle 1A1F of the ,ivil ,ode.
Trial ,ourt rendered &udgment in favor of #ragon, on the grounds that =ontilla
admitted her acceptance of the verbal contract.
Issue:
%hether or not a verbal contract was established
Held:
+espite allegations of having accepted and demanded the option, the court ruled
that the oral
promise to sell was not binding upon the o$eror in view of the absence of any
consideration distinct from the stipulated price, quoting #rticle 1A1F.
9ven if the promise is accepted, one is not bound thereby in the absence of a
distinct consideration.
4.. /AO KA SIN T%ADING VS CA
Facts:
President and ,hairman of the Board of Prime %hite ,ement ,orporation3P%,,4
sent to @ao Na )in Trading 3@N)4 an undated letter8o$er for the sale of A<,000 bags
of Prime %hite ,ement.
#fter the signing of the letter, the Board of +irectors of P%,, disapproved the same
and sent a letter to @N) informing the latter of such disapproval. /owever, @N)
denied having received a copy of the letter of disapproval.
#fter several e6change of letters, P%,, had delivered only F,11< bags of white
cement.
@N) requested P%,, for the compliance with its obligation under the letter8o$er but
P%,, reiterated the unenforceability of the letter8o$er.
Thus, @N) !led with the :T, a complaint for )peci!c Performance with +amages
against P%,,

Issue:
%hether or not there is a valid contract of sale
Held:
The option to sell is not valid because it is not supported by any consideration
distinct from the price.
&ven if the promise is accepted, private respondent was not bound thereby in the
absence of a distinct consideration.
&0. NIETES VS CA
FACTS:
Petitioner #quilino ietes and respondent +r.Pablo Carcia entered a (,ontract of
;ease and .ption to Buy* where the latter agreed to lease his #ngeles 9ducational
Institute to the former.
The rent is set to P<000 per year up to < years and that the ;9)).: agrees to give
the ;9))99 an option to buy the land and the school building, for P100,000 within
the period of the ,ontract of ;ease.
ietes paid Carcia PDD00 on +ec.1B, 1FBD for partial payment on the purchase of
the property. Through their lawyers, Carcia decided to rescind the contract while
ietes e6presses his intention to buy the property.
ietes also deposited OAN to a ban" corresponding to the balance for the purchase
of the property.
ISS(E:
%. ietes can avail of his option to buy the property.
HELD:
In an option to buy, the party in whose favor the option contract e6ist may validly
and e$ectively e6ercise his right by merely advising the o$eror of the decision to
buy and e6pressing his readiness to pay the stipulated price, provided that the
same is available and actually delivered to the o$eror upon e6ecution and delivery
by him of the corresponding deed of sale. In other words, notice of the e6ercise of
the option need not be coupled with actual payment of the
price, so long as this is delivered to the owner of the property upon performance of
his part of the agreement.
ietes can avail of the option to buy because he already e6press his intention to
buy the property before the termination of the contract. The contention of the
respondent that the full price of the property should !rst be paid before the option
could be e6ercised is of no merit.
The contract doesn2t provide such stipulation and as such, the provision of
reciprocal obligations in oblicon should prevail. otice of the creditorLs decision to
e6ercise his option to buy need not be coupled with actual payment of the price, so
long as this is delivered to the owner of the property upon performance of his part
of the agreement.
ietes had validly and e$ectively e6ercised his option to buy the property of +r.
Carcia, at least, on +ecember 10, 1FBD, when he ac"nowledged receipt from =rs.
ietes of the sum of PD,D00 then delivered by her 5in partial payment on the
purchase of the property5 described in the 5,ontract of ;ease with .ption to Buy5
VAS1(E* VS CA
9$ects when sale ad&udged to be an equitable mortgage
Facts:
Pnder an agreement denominated as a pacto de retro sale, =aria =endo-a Qda. +e
.campo acquired a parcel of land from ;uisa Briones. The latter thereunder
reserved the right to repurchase the parcel of land up to +ecember 01, 1F10.
.n 7une 1A, 1FF0, /ipolita .campo Paulite and 9usebio =endo-a .campo, the heirs
of =aria =endo-a Qda. +e .campo, !led a petition for consolidation of ownership,
alleging that the seller was not able to e6ercise her privilege to redeem the property
on or before +ecember 01, 1F10.
,# ruled that the contract entered was of equitable mortgage.
Issue:
%hether or not the agreement was equitable mortgage
Held:
In an equitable mortgage situation, the consolidation of ownership in the person of
the mortgagee in equity upon failure of the mortgagor in equity to pay the
obligation, would amount to a pactum commissorium> and that an action for
consolidation of ownership is an inappropriate remedy on the part of the mortgagee
in equity. The ,ourt held that the only proper remedy is to cause the foreclosure of
the mortgage in equity.
The equitable mortgage being a security contract, the e6piration of the purported
period of redemption does not prevent the purported seller 3actually the equitable
mortgagor4 from e6tinguishing the main contract of loan, and thereby e6tinguish
also the ancillary equitable mortgage contract, so long as the purported buyer 3the
equitable mortgagee4 has not gone through the process of foreclosure. Eoreclosure
cannot ta"e the form of the creditor8mortgagor appropriating for himself the
property given as security, because this would amount to pactum
commissorium.
ANG /( VS CA
FACTS:
The Pni&eng spouses owned certain residential and commercial spaces leased by
#ng @u. They o$ered to sell the said units to #ng @u on several occasions and for
PB=. #ng @u made a counter o$er for P<=. The Pni&eng spouses as"ed #ng @u to
specify his terms in writing but the latter failed to do so. They failed to arrive at any
de!nite agreement. %hen #ng @u discovered that the spouses were planning to sell
the property to others, he sued them for speci!c performance. %hile the case was
pending, the spouses sold the units to Buen :ealty for P1<=.
ISS(E:
%hether or not there was a perfected contract of sale between Pni&eng and #ng @u
HELD:
.. There was no perfected contract of sale yet since there was yet any meeting of
the minds. Thus, there is no ground for speci!c performance. +uring the negotiation
stage, any party may withdraw the o$er madeRespecially if it was not supported by
any consideration. #n .ption ,ontract of a :ight of Eirst :efusal is separate and
distinct from the actual contract of saleRwhich is the basis for speci!c performance.
The remedy available to #ny @u, in case the withdrawal was made capriciously and
arbitrarily, would be to sue on the basis of abuse of right. In case there was an
option contract, timely acceptance would create an obligation to sell on the part of
the vendor> but no such circumstance attends in this case.
E1(ITO%IAL %EALT/ DEVELO$MENT VS MA/FAI% THEATE%
Facts:
Eor its theaters, =ayfair was leasing a portion of the property in ,= :ecto, which
,armelo owns. Pnder the lease agreement, (if ,armelo should decide to sell the
leased premises, =ayfair shall be given 00 days e6clusive option to purchase the
same.* ,armelo, through /enry @ang, informed the president of =ayfair that the
former is interested in selling the whole ,= :ecto propertyRand that #raneta
o$ered to purchase the same for S1.D=. =ayfair twice replied through a letter of its
intention to e6ercise its right to repurchaseRbut ,armelo never replied. Thereafter,
,armelo sold the entire property to 9quatorial :ealty for some P11=. Thus, =ayfair
instituted an action for speci!c performance and annulment of the sale.
,armelo alleges that the right, being an option contract, is void for lac" of
consideration.
Issue:
%hether or not the right to repurchase is an option contract and void for lac" of
consideration
Held:
.. The clause in the lease agreement was .T an option contract, but a :IC/T .E
EI:)T :9EP)#;. It was premised on ,armelo2s decision to sell the said property. It
also did not contain a stipulation as to the price of said property. The requirement of
separate consideration does not apply to a right of 1
st
:efusal because consideration
is already an integral part of the lease. ,armelo violated such right by not a$ording
=ayfair a fair chance to negotiate. It abandoned the negotiations arbitrarily.
9quatorial was li"ewise in bad faith> it was well aware of the right conferred upon
=ayfair because its lawyers had ample time to review the contract. That being the
case, the contract between ,armelo and 9quatorial is rescissible.
=ayfair should be allowed to purchase the entire property for the price o$ered by
9quatorial. :ights of Eirst :efusal are also governed by the law on contracts, not the
amorphous principles on human relations
VILLONCO VS 'O%MAHECO
Facts:
Bormaheco sent a written o$er to Qillonco :ealty providing for the following terms
for the sale of its Buendia lotsG <A00 per square meters, with earnest money of
<100,000.00, which will be returned if the sale is not consummated> sale would be
sub&ect to the purchase by Bormaheco of )ta. #na lots> and that the deed of sale
would be e6ecuted in A< days. Qillonco :ealty gave a written reply con! rming the
terms, with the deviation that if the sale is not consummated it will earn interest of
10T, accompanied by a chec" for the <100,000.00 earnest money.
Bormaheco encashed the chec", and sent a written response to Qillonco :ealty
stating thatG the lots in the )ta. #na were particularly described as those belonging
to ational )hipping
,ompany> and that the interest of 10T would be computed on a per annum basis.
9ven when Bormaheco was able to purchase the )ta. #na lots, it refused to proceed
with the sale of the Buendia lots to Qillonco :ealty, returned the amount of
<100,000.00, stating that since Qillonco :ealty, had given merely a counter8o$er to
the original o$er made by Bormaheco, and that in turn Bormaheco had certain
amendments to the reply received from Qillonco :ealty, no sale had been perfected,
there was only a standing counter8o$er which has not been accepted, and that
Bormaheco had a right to withdraw from the o$er.
Issue:
%hether or not there was a perfected sale
Held:
The ,ourt held that there was a perfected sale that arose from the e6change of
correspondences, even if literally, there was a correction or modi! cation contained
in the acceptance, the changes were not substantial, but merely clari! catory. )uch
is corroborated also by the fact, that upon receipt of the chec" covering the earnest
money, Bormaheco had encashed the same.
S$O(SES DO%OMAL VS CA
Facts:
# parcel of land in Iloilo were co8owned by 1 siblings all surnamed /orilleno. < of the
siblings gave a )P# to their niece =ary 7imene-, who succeeded her father as a co8
owner, for the sale of the land to father and son +oromal. .ne of the co8owner,
herein petitioner, Eilomena 7avellana however did not gave her consent to the sale
even though her siblings e6ecuted a )P# for her signature. The co8owners went on
with the sale of BM1 part of the land and a new title for the +oromals were issued.
:espondent o$ered to repurchase the land for 00N as stated in the deed of sale but
petitioners declined invo"ing lapse in time for the right of repurchase. Petitioner
also contend that the 00N price was only placed in the deed of sale to minimi-e
payment of fees and ta6es and as such, respondent should pay the real price paid
which was P11<, D<0.
IssueG %hether or not the period to repurchase of petitioner has already lapsed.
Held:
Period of repurchase has not yet lapsed because the respondent was not noti!ed of
the sale. The 008day period for the right of repurchase starts only after actual notice
not only of a perfected sale but of actual e6ecution and delivery of the deed of sale.
The letter sent to the respondent by the other co8owners 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. #s such, the 008day period has not yet commenced
and the respondent can still e6ercise his right to repurchase.
The respondent should also pay only the 00N stipulated in the deed of sale because
a redemptioner2s right is to be subrogated by the same terms and conditions
stipulated in the contract.
The court held that although written notice is given to the co8owner, the 008day
redemption period does not begin to run from the receipt of such written notice,
because the transaction covered in the notice did not pertain to a perfected
contract of sale, and must be accompanied by the actual e6ecution and delivery of
the deed of sale. The ,ourt held that (#rt. 1B1F of the ,ivil ,ode bestows unto a
coowner the right to redeem and Uto be subrogated under the same terms and
conditions stipulated in the contract,2 and to avoid any controversy as to the terms
and conditions under which the right to redeem may be e6ercised, it is best that the
period therefore should not be deemed to have commenced unless the notice of the
disposition is made after the formal deed of disposal has been duly e%ecuted.*
GOLDEN%OD VS CA
FACTS:
:espondents Barreto realty owns A0 parcels of land in Juiapo =anila which they
mortgaged in P,PB. :espondent sold the property to petitioner Coldenrod who In
turn pays 1= earnest money and promise to pay respondent2s debt to P,PB.
:espondent caused D land titles to the property.
Petitioner was not able to pay P,PB and the latter did not agree for and e6tension.
/ence, petitioner rescinded the contact and demands the return of the earnest
money.
:espondent did not oppose the recession but did not gave the earnest money. They
even sold the !rst lot to #siaworld Trade ,enter and the other lot to P,PB for
payment of their mortgage.
ISS(E:
%. respondent should return the earnest money of the petitioner.
HELD:
9arnest money is a part of payment of a sale. #rt. 10O< of the ,ivil ,ode provides
that rescission creates the obligation to return the things which were the ob&ect of
the contract together with their fruits and interest. )ince the respondent did not
oppose the e6tra8&udicial recission, they should return the earnest money of the
petitioner. It would be most inequitable if resondent B#::9TT. :9#;T@ would be
allowed to retain petitionerLs payment of P1,000,000.00 and at the same time
appropriate the proceeds of the second sale made to another.
DALION VS CA
FACTS:
Petitioner )egundo +alion allegedly sold his property in )outhern ;eyte to
respondent :uperto )abesa&e through a private deed of sale.
+alion denies the sale and claims that his signature in the document was forged.
ISS(E:
%. there has been a contract of sale between the parties.
HELD:
The authenticity of the signature of +allion was proven by the testimony of several
witness including the person who made the deed of sale. +alion never presented
any evidence or witness to prove his claim of forgery.
+allion2s claim that the sale is invalid because it was not made in a public document
is of no merit. This argument is misplaced. The provision of #rt. 10<O on the
necessity of a public document is only for convenience, not for validity or
enforceability. It is not a requirement for the validity of a contract of sale of a parcel
of land that this be embodied in a public instrument. )ale is perfected upon meeting
of the minds of both parties.
/(VIENGCO VS DAC(/C(/
FACTS:
Petitioners own a property in Tacloban ,ity which they intend to sell for B.<=. They
gave the respondents the right to purchase the property nut only until 7uly 01, 1F1O.
:espondents replied that they agree to buy the property and they will negotiate for
details. Petitioner sent another telegram informing respondents that their proposal
is accepted and a contract will be prepared.
;awyer of defendant, =r.Camboa, arrived bringing a contact with an altered mode
of payment which says that the balance payment should be paid withing 00 days
instead of the former F0 days. 3.tiginal termsG D= payment upon e6ecution. A.<=
after F0 days4
ISS(E:
%. there was already a perfected contract of sale between the parties.
HELD:
There was no perfected contract of sale yet because both parties are still under
negotiation and hence, no meeting of the minds. =r.Camboa even went to the
respondents to negotiate for the sale. 9ven though there was an agreement on the
terms of payment, there was no absolute acceptance because respondents still
insisted on further details.
%ith regard to the alleged violation of terms of payment, there was no written
document to prove that the respondents agreed to pay not in cash but in
installment. In sale of real property, payment of installment must be in requisite of a
note under the statute of frauds.
FI%ST $HILI$$INE INTE%NATIONAL 'ANK VS CA
Facts:
Issue:
Held:
It was held that various correspondences when ta"en together would constitute
su?cient memorandum R since they include the names of the parties, the terms
and conditions of the contract, the price and a description of the property as the
ob&ect of the contract.
VDA. DE 2OMOC VS CA
FACTS:
# parcel of land in ,+. owned by late Pantaleon 7omoc was !ctitiously sold to third
persons in which the last transferee are the spouses =ariano and =aria )o. =aria
Qda de 7omoc !led suit to recover the property and won.
%hile pending appeal, Qda de 7omoc e6ecuted e6ecuted a +eed of 96tra&udicial
)ettlement and )ale of ;and with private respondent for P000,000.00. The
document was not yet signed by all the parties nor notari-ed but in the meantime,
=aura )o had made partial payments amounting to PAF,000.00.
)o demanded from the heirs of 7omoc for the e6ecution of !nal deed of conveyance
but the latter did no comply. #s such, )o !led a civil case and a notice of lis pendens
were placed in the title of the land.
.n the same date, the heirs of 7omoc e6ecuted another e6tra8&udicial settlement
with absolute sale in favor of intervenors ;im ;eong Nang and ;im Pue claiming that
they believe that )o already bac"ed8out from the agreement.
ISS(E:
%. the sale is enforceable.
HELD:
)ince petitioners admit the e6istence of the e6tra8&udicial settlement, the court !nds
that there was meeting of the minds between the parties and hence, there is a valid
contract that has been partly e6ecuted.
The contract of sale of real property even if not complete in form, so long as the
essential requisites of consent of the contracting parties, ob&ect, and cause of the
obligation concur and they were clearly established to be present, is valid and
e$ective as between the parties. Public document is only needed to bind third
persons.
The payment made by )o is a clear proof of her intention to acquire the property
and the petitioners cannot claim about the respondent bac"ing out. The sale to the
intervenors ;im cannot be recogni-ed because when they bought the property,
there was already a notice of lis pendens and the sale cannot be said to be in good
faith.
It was held that the partial e6ecution of a sale over real property ta"es the
transaction out of the provisions of the )tatute of Erauds, and consequently even
when not complete in form, so long as the essential requisites of consent of the
contracting parties, ob&ect and cause of the obligation concur and they were clearly
established to be present 3even by parol evidence4, the sale is valid and binding.
C(/(GAN VS SANTOS
Facts:
Issue:
Held:
:elying upon precedents in the Pnited )tates, the )upreme ,ourt held that the
)tatute of Erauds does not stand in the way of treating an absolute deed as a
mortgage, when such was the intention of the parties, although the agreement for
redemption or defeasance rests wholly in parol, or is proved by parol evidenceG (The
courts will not be used as a shield for fraud, or as a means for perpetrating fraud.*