G.R. No. 173441.

December 3, 2009
HEIRS OF SOFIA QUIRONG
v. DBP

ABAD, J.:

FACTS: When the late Emilio Dalope died, he left an untitled lot to his wife, Felisa and
their nine children, one of whom was Rosa Dalope-Funcion. To enable Rosa and her
husband Antonio Funcion get a loan from respondent DBP, Felisa sold the whole lot to
the Funcions. After the Funcions failed to pay their loan, the DBP foreclosed the lot and
four years later, sold the lot to Sofia Quirong. Two months after that sale, Felisa and her
eight children filed an action against the DBP and the Funcions. On May 11, 1985,
petitioners filed an answer in intervention in which the RTC declared that the DBPs sale
to Sofia Quirong valid only with respect to the shares of Felisa and Rosa Funcion in the
property. DBP failed to appeal. On June 10, 1998 the Quirong heirs filed the present
action against the DBP for rescission of the contract of sale between Sofia Quirong and
the DBP. After hearing the case, the RTC rendered a decision, rescinding the sale
between Sofia Quirong and the DBP. On appeal by the DBP, the CA reversed the RTC
decision and dismissed the heirs action on the ground of prescription.

ISSUE: Whether the Quirong heirs action for rescission of respondent DBPs sale of the
subject property to Sofia Quirong was already barred by prescription.

RULING: Yes. The action for rescission is already barred by prescription.The Court held
that the Quirong heirs action for rescission of the sale between DBP and their
predecessor, Sofia Quirong, is barred by prescription reckoned from the date of finality of
the December 16, 1992 RTC decision and applying the prescriptive period of four years
set by Article 1389 of the Civil Code. WHEREFORE, the Court DENIES the petition
and AFFIRMS the decision of the CA.
G.R. No. 134685. November 19, 1999.
SIGUAN v. LIM
DAVIDE, JR., C.J.:

FACTS: Respondent LIM issued two Metrobank checks. Upon presentment by petitioner
with the drawee bank, the checks were dishonored for the reason account closed.
Demands to make good the checks proved futile. As a consequence, a criminal case for
violation of Batas Pambansa Blg. 22 were filed by petitioner against LIM. Meanwhile, a
Deed of Donation conveying parcels of land and purportedly executed by LIM in favor of
her children. Petitioner filed an accion pauliana against LIM and her children to rescind
the questioned Deed of Donation and to declare as null and void. Petitioner claimed
therein that the transfer was in bad faith and in fraud of creditors since at the time of the
fraudulent conveyance, left no sufficient properties to pay her obligations. The trial court
ordered the rescission of the questioned deed of donation. On appeal, the CA reversed
the decision of the trial court and dismissed petitioners accion pauliana.

ISSUE: Whether the questioned Deed of Donation was made in fraud of petitioner and,
therefore, rescissible.

RULING: The Court ruled in the negative. Article 1381 of the Civil Code enumerates the
contracts which are rescissible, and among them are those contracts undertaken in fraud
of creditors when the latter cannot in any other manner collect the claims due them. The
action to rescind contracts in fraud of creditors is known as accion pauliana. Under Article
1381 of the Civil Code, contracts entered into in fraud of creditors may be rescinded only
when the creditors cannot in any manner collect the claims due them. Also, Article 1383
of the same Code provides that the action for rescission is but a subsidiary remedy which
cannot be instituted except when the party suffering damage has no other legal means to
obtain reparation for the same. The term subsidiary remedy has been defined as the
exhaustion of all remedies by the prejudiced creditor to collect claims due him before
rescission is resorted to. Petitioner neither alleged nor proved that she did so. On this
score, her action for the rescission of the questioned deed is not maintainable even if the
fraud charged actually did exist. WHEREFORE, the petition is hereby DISMISSED.
G.R. No. 108346. July 11, 2001.
Velarde v. CA

PANGANIBAN, J.:

FACTS: The private respondent executed a Deed of Sale with Assumption of Mortgage,
with a balance of P1.8 million, in favor of the petitioners. Pursuant to said agreements,
plaintiffs paid the bank (BPI) for three (3) months until they were advised that the
Application for Assumption of Mortgage was denied. This prompted the plaintiffs not to
make any further payment. Private respondent wrote the petitioners informing the non-
fulfillment of the obligations. Petitioners, thru counsel responded that they are willing to
pay in cash the balance subject to several conditions. Private respondents sent a notarial
notice of cancellation/rescission of the Deed of Sale. Petitioners filed a complaint which
was consequently dismissed by an outgoing judge but was reversed by the assuming
judge in their Motion for Reconsideration. The Court of Appeals reinstated the decision to
dismiss.

ISSUE: Whether the non-payment of the mortgage obligation resulted in a breach of the
contract which would warrant rescission.

RULING: YES. The petition is partly meritorious. Art. 1191 of the Civil Code provides that
the power to rescind obligations is implied in reciprocal ones, in case one of the obligors
should not comply with what is incumbent upon him. The breach committed did not merely
consist of a slight delay in payment or an irregularity; such breach would not normally
defeat the intention of the parties to the contract. Here, petitioners not only failed to pay
the P1.8 million balance, but they also imposed upon private respondents new obligations
as preconditions to the performance of their own obligation. In effect, the qualified offer
to pay was a repudiation of an existing obligation, which was legally due and demandable
under the contract of sale. Hence, private respondents were left with the legal option of
seeking rescission to protect their own interest.
G.R. No. 176841. June 29, 2010
ORDUA, ET AL. v. FUENTEBELLA, ET AL.

VELASCO, JR., J.:

FACTS: Antonita Ordua purchased a residential lot from Gabriel Sr. payable in
installments but no deed of sale was executed. The installments were paid to Gabriel Sr.
and later to Gabriel Jr. after the death of the former. Improvements were thereafter
introduced by petitioner and the latter even paid its real property tax since 1979. Unknown
to Ordua, the property has been subject to further alienations until the same was ceded
to respondent, Fuentebilla, Jr. Ordua, after being demanded by Fuentebilla to vacate
the disputed land, then filed a Complaint for Annulment of Sale, Title, Reconveyance with
Damages with a prayer to acquire ownership over the subject lot upon payment of their
remaining balance. The Regional Trial Court dismissed the petition because the verbal
sale between Gabriel Sr. and Ordua was unenforceable under the Statute of Frauds.
This was later affirmed by the Court of Appeals.

ISSUE: Whether the sale of the subject lot by Gabriel Sr. to Antonita is unenforceable
under the Statute of Frauds

HELD: No. It is a well-settled rule that the Statute of Frauds as expressed in Article 1403,
par. (2), of the Civil Code is applicable only to purely executory contracts and not to
contracts which have already been executed either totally or partially. Here, the verbal
contract of sale has been partially executed through the partial payments made by
Ordua duly received by both Gabriel Jr. and his father. The purpose of the Statute of
Fraud is prevention fraud and perjury in the enforcement of obligations depending for their
evidence on the unassisted memory of witnesses, by requiring some contracts and
transactions to be evidenced by a writing signed by the party to be charged. Since there
is already ratification of the verbal contract through the acceptance of benefits through
the partial payments, it is thus withdrawn from the purview of the Statute of Frauds.
G.R. No. 118509. December 1, 1995.
LIMKETKAI SONS MILLING, INC.,
v. COURT OF APPEALS

MELO, J.:

FACTS: Branch 151 of the Regional Trial Court of the National Capital Region stationed
in Pasig ruled that there was a perfected contract of sale petitioner and BPI. It stated that
there was mutual consent between the parties; the subject matter is definite; and the
consideration was determined. It concluded that all the elements of a consensual contract
are attendant. It ordered the cancellation of a sale effected by BPI to respondent National
Book Store (NBS) while the case was pending and the nullification of a title issued in favor
of said respondent NBS. Upon elevation of the case to the Court of Appeals, it was held
that no contract of sale was perfected because there was no concurrence of the three
requisites enumerated in Article 1318 of the Civil Code. The decision of the trial court was
reversed and the complaint dismissed. Hence, the instant petition.
ISSUE: Whether NBS is an innocent purchaser for value
RULING: No. NBS is a purchases in bad faith. Respondent NBS ignored the notice of lis
pendens annotated on the title when it bought the lot. It was the willingness and design
of NBS to buy property already sold to another party which led BPI to dishonor the
contract with Limketkai. Petitioner cites several badges of fraud indicating that BPI and
NBS conspired to prevent petitioner from paying the agreed price and getting possession
of the property. Therefore, the sale of the lot to NBS during the trial of the case was
characterized by bad faith.
G.R. No. 179323: November 28, 2011
MANZANO v. GARCIA

LEONARDO-DE CASTRO, J.:

FACTS: On July 12, 1992, Constancio Manzano passed away. His properties,
including the subject of this case, were adjudicated to his heirs by virtue of a deed of
extrajudicial partition with special power of attorney executed by them. Vicente was
named the administrator of the intestate estate of Constancio Manzano. Garcia did
not redeem the subject property within the three-month period. Consequently, Vicente
instituted a petition for consolidation of ownership over the property. Garcia filed an
opposition and answer, alleging that the document evidencing the pacto de retro sale
was a forgery. Atty. Mediante, the person who notarized the deed of conveyance in
question, and Perla Babano, one of the witnesses to the execution of the pacto de
retro sale, testified that the Marcelino Garcia who appeared in his office and who
executed the pacto de retro sale is not the same Marcelino Garcia who was in court
during the trial of the case.
ISSUE: Whether the pacto de retro sale between the parties was valid.

HELD: From an assiduous examination of the records of the case, it is plainly

apparent to this Court that the alleged signature of Garcia in the pacto de retro sale is
utterly dissimilar from his customary signature appearing in the evidence on record,
as well as in the verifications of the pleadings before this Court and the courts a quo.
From this circumstance alone, we are constrained to affirm the ruling of the Court of
Appeals finding that the pacto de retro sale was forged and, therefore, void ab initio.
The "presumption of regularity of notarized documents is not absolute and may be
rebutted by clear and convincing evidence to the contrary. WHEREFORE, the Petition
is DENIED.
G.R. No. 143958. July 11, 2003.
FRENZEL v. CATITO

CALLEJO, SR., J.:

FACTS: Petitioner Alfred Fritz Frenzel bought numerous properties such as house and
lot in Quezon City and in Davao City for Ederlina. He also put up a beauty parlor business
in the name her name. Alfred was unaware that Ederlina was married until her spouse
Klaus Muller wrote a letter to Alfred begging the latter to leave her wife alone. To avoid
complications, Alfred decided to live separately from Ederlina and cut off all contacts with
her. On October 15, 1985, Alfred wrote to Ederlinas father, complaining that Ederlina had
taken all his life savings and further accused the Catito family of acquiring for themselves
the properties he had purchased with his own money. He demanded the return of all the
amounts that Ederlina and her family had stolen and turn over all the properties acquired
by him and Ederlina during their coverture.

ISSUE: Whether the intention of the petitioner is not to own real properties in the
philippines but to sell them at public auction to be able to recover his money used in
purchasing them.

HELD: No. The sales in question were entered into by him as the real vendee are in
violation of the Constitution; hence, are null and void ab initio. A contract that violates the
Constitution and the law, is null and void and vests no rights and creates no obligations.
It produces no legal effect at all. The petitioner, being a party to an illegal contract, cannot
come into a court of law and ask to have his illegal objective carried out. One who loses
his money or property by knowingly engaging in a contract or transaction which involves
his own moral turpitude may not maintain an action for his losses. To him who moves in
deliberation and premeditation, the law is unyielding. The law will not aid either party to
an illegal contract or agreement; it leaves the parties where it finds them. IN LIGHT OF
ALL THE FOREGOING, the petition is DISMISSED.
GR No. L-47362.December 19, 1940.
VILLARROEL v. ESTRADA

FACTS: Alejandro F. Callao obtained from the spouses Mariano Estrada and Severina a
loan of P1,000 payable after seven years. Alejandra died, leaving as sole heir to the
defendant. The spouses Mariano Estrada and Severina also died, leaving as sole heir the
plaintiff Bernardino Estrada. On August 9, 1930, the defendant signed a document which
declares the applicant to owe the amount of P1,000, with an interest of 12 percent per
year. This action deals with the collection of this amount. The Court of First Instance of
Laguna, in which this action was filed, ordered the defendant to pay the claimant the
claimed amount of P1,000 with his legal interests of 12 percent a year from August 9,
1930 until its full payment. This sentence is appealed.

ISSUE: Whether the present action is barred by prescription

RULING: No. The rule that a new promise to pay a pre-paid debt must be made by the
same obligated person or by another legally authorized by it, is not applicable to the
present case in which it is not required to fulfill the obligation of the obligee orignally, but
of which he voluntarily wanted to assume this obligation. The present action is not based
on the original obligation contracted by the defendant's mother, which has already been
prescribed, but in which the defendant contracted on August 9, 1930. The defendant is
the only inheritor of the primitive debtor, with the right to succeed in his inheritance, that
debt, brought by his mother legally, although it has lost its effectiveness by prescription,
is now, however, for a moral obligation, The judgment appealed against is upheld, with
costs being paid to the appellant.
G.R. No. 128120. October 20, 2004.
SWEDISH MATCH v. CA

TINGA, J.:

Petitioners seek a reversal of the twin Orders[1] of the Court of Appeals dated 15
November 1996[2] and 31 January 1997,[3] in CA-G.R. CV No. 35886, entitled ALS
Management et al., v. Swedish Match, AB et al. The appellate court overturned the trial
courts Order[4] dismissing the respondents complaint for specific performance and
remanded the case to the trial court for further proceedings.
Swedish Match, AB (hereinafter SMAB) is a corporation organized under the laws of
Sweden not doing business in the Philippines. SMAB, however, had three subsidiary
corporations in the Philippines, all organized under Philippine laws, to wit: Phimco
Industries, Inc. (Phimco), Provident Tree Farms, Inc., and OTT/Louie (Phils.), Inc.
Sometime in 1988, STORA, the then parent company of SMAB, decided to sell SMAB
of Sweden and the latters worldwide match, lighter and shaving products operation to
Eemland Management Services, now known as Swedish Match NV of Netherlands,
(SMNV), a corporation organized and existing under the laws of Netherlands. STORA,
however, retained for itself the packaging business.
SMNV initiated steps to sell the worldwide match and lighter businesses while
retaining for itself the shaving business. SMNV adopted a two-pronged strategy, the first
being to sell its shares in Phimco Industries, Inc. and a match company in Brazil, which
proposed sale would stave-off defaults in the loan covenants of SMNV with its syndicate
of lenders. The other move was to sell at once or in one package all the SMNV companies
worldwide which were engaged in match and lighter operations thru a global deal
(hereinafter, global deal).
Ed Enriquez (Enriquez), Vice-President of Swedish Match Sociedad Anonimas
(SMSA)the management company of the Swedish Match groupwas commissioned and
granted full powers to negotiate by SMNV, with the resulting transaction, however, made
subject to final approval by the board. Enriquez was held under strict instructions that the
sale of Phimco shares should be executed on or before 30 June 1990, in view of the tight
loan covenants of SMNV. Enriquez came to the Philippines in November 1989 and
informed the Philippine financial and business circles that the Phimco shares were for
sale.
Several interested parties tendered offers to acquire the Phimco shares, among
whom were the AFP Retirement and Separation Benefits System, herein respondent ALS
Management & Development Corporation and respondent Antonio Litonjua (Litonjua), the
president and general manager of ALS.
In his letter dated 3 November 1989, Litonjua submitted to SMAB a firm offer to buy
all of the latters shares in Phimco and all of Phimcos shares in Provident Tree Farm, Inc.
and OTT/Louie (Phils.), Inc. for the sum of P750,000,000.00.[5]
 Through its Chief Executive Officer, Massimo Rossi (Rossi), SMAB, in its letter dated
1 December 1989, thanked respondents for their interest in the Phimco shares. Rossi
informed respondents that their price offer was below their expectations but urged them
to undertake a comprehensive review and analysis of the value and profit potentials of
the Phimco shares, with the assurance that respondents would enjoy a certain priority
although several parties had indicated their interest to buy the shares.[6]
Thereafter, an exchange of correspondence ensued between petitioners and
respondents regarding the projected sale of the Phimco shares. In his letter dated 21 May
1990, Litonjua offered to buy the disputed shares, excluding the lighter division for
US$30.6 million, which per another letter of the same date was increased to US$36
million.[7] Litonjua stressed that the bid amount could be adjusted subject to availability of
additional information and audit verification of the company finances.
Responding to Litonjuas offer, Rossi sent his letter dated 11 June 1990, informing the
former that ALS should undertake a due diligence process or pre-acquisition audit and
review of the draft contract for the Match and Forestry activities of Phimco at ALS
convenience. However, Rossi made it clear that at the completion of the due diligence
process, ALS should submit its final offer in US dollar terms not later than 30 June 1990,
for the shares of SMAB corresponding to ninety-six percent (96%) of the Match and
Forestry activities of Phimco. Rossi added that in case the global deal presently under
negotiation for the Swedish Match Lights Group would materialize, SMAB would
reimburse up to US$20,000.00 of ALS costs related to the due diligence process.[8]
Litonjua in a letter dated 18 June 1990, expressed disappointment at the apparent
change in SMABs approach to the bidding process. He pointed out that in their 4 June
1990 meeting, he was advised that one final bidder would be selected from among the
four contending groups as of that date and that the decision would be made by 6 June
1990. He criticized SMABs decision to accept a new bidder who was not among those
who participated in the 25 May 1990 bidding. He informed Rossi that it may not be
possible for them to submit their final bid on 30 June 1990, citing the advice to him of the
auditing firm that the financial statements would not be completed until the end of July.
Litonjua added that he would indicate in their final offer more specific details of the
payment mechanics and consider the possibility of signing a conditional sale at that
time.[9]
Two days prior to the deadline for submission of the final bid, Litonjua again advised
Rossi that they would be unable to submit the final offer by 30 June 1990, considering
that the acquisition audit of Phimco and the review of the draft agreements had not yet
been completed. He said, however, that they would be able to finalize their bid on 17 July
1990 and that in case their bid would turn out better than any other proponent, they would
remit payment within ten (10) days from the execution of the contracts.[10]
Enriquez sent notice to Litonjua that they would be constrained to entertain bids from
other parties in view of Litonjuas failure to make a firm commitment for the shares of
Swedish Match in Phimco by 30 June 1990.[11]
In a letter dated 3 July 1990, Rossi informed Litonjua that on 2 July 1990, they signed
a conditional contract with a local group for the disposal of Phimco. He told Litonjua that
his bid would no longer be considered unless the local group would fail to consummate
the transaction on or before 15 September1990.[12]
Apparently irked by SMABs decision to junk his bid, Litonjua promptly responded by
letter dated 4 July 1990. Contrary to his prior manifestations, he asserted that, for all
intents and purposes, the US$36 million bid which he submitted on 21 May 1990 was
their final bid based on the financial statements for the year 1989. He pointed out that
they submitted the best bid and they were already finalizing the terms of the sale. He
stressed that they were firmly committed to their bid of US$36 million and if ever there
would be adjustments in the bid amount, the adjustments were brought about by SMABs
subsequent disclosures and validated accounts, such as the aspect that only ninety-six
percent (96%) of Phimco shares was actually being sold and not one-hundred percent
(100%).[13]
More than two months from receipt of Litonjuas last letter, Enriquez sent a fax
communication to the former, advising him that the proposed sale of SMABs shares in
Phimco with local buyers did not materialize. Enriquez then invited Litonjua to resume
negotiations with SMAB for the sale of Phimco shares. He indicated that SMAB would be
prepared to negotiate with ALS on an exclusive basis for a period of fifteen (15) days from
26 September 1990 subject to the terms contained in the letter. Additionally, Enriquez
clarified that if the sale would not be completed at the end of the fifteen (15)-day period,
SMAB would enter into negotiations with other buyers.[14]
Shortly thereafter, Litonjua sent a letter expressing his objections to the totally new
set of terms and conditions for the sale of the Phimco shares. He emphasized that the
new offer constituted an attempt to reopen the already perfected contract of sale of the
shares in his favor. He intimated that he could not accept the new terms and conditions
contained therein.[15]
On 14 December 1990, respondents, as plaintiffs, filed before the Regional Trial
Court (RTC) of Pasig a complaint for specific performance with damages, with a prayer
for the issuance of a writ of preliminary injunction, against defendants, now petitioners.
The individual defendants were sued in their respective capacities as officers of the
corporations or entities involved in the aborted transaction.
Aside from the averments related to their principal cause of action for specific
performance, respondents alleged that the Phimco management, in utter bad faith,
induced SMAB to violate its contract with respondents. They contended that the Phimco
management took an interest in acquiring for itself the Phimco shares and that petitioners
conspired to thwart the closing of such sale by interposing various obstacles to the
completion of the acquisition audit.[16] Respondents claimed that the Phimco
management maliciously and deliberately delayed the delivery of documents to Laya
Manabat Salgado & Co. which prevented them from completing the acquisition audit in
time for the deadline on 30 June 1990 set by petitioners. [17]Respondents added that
SMABs refusal to consummate the perfected sale of the Phimco shares amounted to an
abuse of right and constituted conduct which is contrary to law, morals, good customs
and public policy.[18]
 Respondents prayed that petitioners be enjoined from selling or transferring the
Phimco shares, or otherwise implementing the sale or transfer thereof, in favor of any
person or entity other than respondents, and that any such sale to third parties be
annulled and set aside. Respondents also asked that petitioners be ordered to execute
all documents or instruments and perform all acts necessary to consummate the sales
agreement in their favor.
Traversing the complaint, petitioners alleged that respondents have no cause of
action, contending that no perfected contract, whether verbal or written, existed between
them. Petitioners added that respondents cause of action, if any, was barred by the
Statute of Frauds since there was no written instrument or document evidencing the
alleged sale of the Phimco shares to respondents.
Petitioners filed a motion for a preliminary hearing of their defense of bar by the
Statute of Frauds, which the trial court granted. Both parties agreed to adopt as their
evidence in support of or against the motion to dismiss, as the case may be, the evidence
which they adduced in support of their respective positions on the writ of preliminary
injunction incident.
In its Order dated 17 April 1991, the RTC dismissed respondents complaint.[19] It
ruled that there was no perfected contract of sale between petitioners and respondents.
The court a quo said that the letter dated 11 June 1990, relied upon by respondents,
showed that petitioners did not accept the bid offer of respondents as the letter was a
mere invitation for respondents to conduct a due diligence process or pre-acquisition audit
of Phimcos match and forestry operations to enable them to submit their final offer on 30
June 1990. Assuming that respondents bid was favored by an oral acceptance made in
private by officers of SMAB, the trial court noted, such acceptance was merely
preparatory to a formal acceptance by the SMABthe acceptance that would eventually
lead to the execution and signing of the contract of sale. Moreover, the court noted that
respondents failed to submit their final bid on the deadline set by petitioners.
Respondents appealed to the Court of Appeals, assigning the following errors:

A. THE TRIAL COURT EXCEEDED ITS AUTHORITY AND JURISDICTION WHEN IT

ERRED PROCEDURALLY IN MOTU PROPIO (sic) DISMISSING THE COMPLAINT IN
ITS ENTIRETY FOR LACK OF A VALID CAUSE OF ACTION WITHOUT THE
BENEFIT OF A FULL-BLOWN TRIAL AND ON THE MERE MOTION TO DISMISS.

B. THE TRIAL COURT ERRED IN IGNORING PLAINTIFF-APPELLANTS CAUSE OF

ACTION BASED ON TORT WHICH, HAVING BEEN SUFFICIENTLY PLEADED,
INDEPENDENTLY WARRANTED A FULL-BLOWN TRIAL.

C. THE TRIAL COURT ERRED IN IGNORING PLAINTIFFS-APPELLANTS CAUSE OF

ACTION BASED ON PROMISSORY ESTOPPEL WHICH, HAVING BEEN
SUFFICIENTLY PLEADED, WARRANTED A FULL-BLOWN TRIAL, INDEPENDENTLY
FOR THE OTHER CAUSES OF ACTION.
D. THE TRIAL COURT JUDGE ERRED IN FORSWEARING JUDICIAL OBJECTIVITY
TO FAVOR DEFENDANTS-APPELLEES BY MAKING UNFOUNDED FINDINGS, ALL
IN VIOLATION OF PLAINTIFFS-APPELLANTS RIGHT TO DUE PROCESS.[20]

After assessing the respective arguments of the parties, the Court of Appeals
reversed the trial courts decision. It ruled that the series of written communications
between petitioners and respondents collectively constitute a sufficient memorandum of
their agreement under Article 1403 of the Civil Code; thus, respondents complaint should
not have been dismissed on the ground that it was unenforceable under the Statute of
Frauds. The appellate court opined that any document or writing, whether formal or
informal, written either for the purpose of furnishing evidence of the contract or for another
purpose which satisfies all the Statutes requirements as to contents and signature would
be sufficient; and, that two or more writings properly connected could be considered
together. The appellate court concluded that the letters exchanged by and between the
parties, taken together, were sufficient to establish that an agreement to sell the disputed
shares to respondents was reached.
The Court of Appeals clarified, however, that by reversing the appealed decision it
was not thereby declaring that respondents are entitled to the reliefs prayed for in their
complaint, but only that the case should not have been dismissed on the ground of
unenforceability under the Statute of Frauds. It ordered the remand of the case to the trial
court for further proceedings.
Hence, this petition.
Petitioners argue that the Court of Appeals erred in failing to consider that the Statute
of Frauds requires not just the existence of any note or memorandum but that such note
or memorandum should evidence an agreement to sell; and, that in this case, there was
no word, phrase, or statement in the letters exchanged between the two parties to show
or even imply that an agreement had been reached for the sale of the shares to
respondent.
Petitioners stress that respondent Litonjua made it clear in his letters that the quoted
prices were merely tentative and still subject to further negotiations between him and the
seller. They point out that there was no meeting of the minds on the essential terms and
conditions of the sale because SMAB did not accept respondents offer that consideration
would be paid in Philippine pesos. Moreover, Litonjua signified their inability to submit
their final bid on 30 June 1990, at the same time stating that the broad terms and
conditions described in their meeting were inadequate for them to make a response at
that time so much so that he would have to await the corresponding specifics. Petitioners
argue that the foregoing circumstances prove that they failed to reach an agreement on
the sale of the Phimco shares.
In their Comment, respondents maintain that the Court of Appeals correctly ruled that
the Statute of Frauds does not apply to the instant case. Respondents assert that the sale
of the subject shares to them was perfected as shown by the following circumstances,
namely: petitioners assured them that should they increase their bid, the sale would be
awarded to them and that they did in fact increase their previous bid of US$30.6 million
to US$36 million; petitioners orally accepted their revised offer and the acceptance was
relayed to them by Rene Dizon; petitioners directed them to proceed with the acquisition
audit and to submit a comfort letter from the United Coconut Planters Bank (UCPB);
petitioner corporation confirmed its previous verbal acceptance of their offer in a letter
dated 11 June 1990; with the prior approval of petitioners, respondents engaged the
services of Laya, Manabat, Salgado & Co., an independent auditing firm, to immediately
proceed with the acquisition audit; and, petitioner corporation reiterated its commitment
to be bound by the result of the acquisition audit and promised to reimburse respondents
cost to the extent of US$20,000.00. All these incidents, according to respondents,
overwhelmingly prove that the contract of sale of the Phimco shares was perfected.
Further, respondents argued that there was partial performance of the perfected
contract on their part. They alleged that with the prior approval of petitioners, they
engaged the services of Laya, Manabat, Salgado & Co. to conduct the acquisition audit.
They averred that petitioners agreed to be bound by the results of the audit and offered
to reimburse the costs thereof to the extent of US$20,000.00. Respondents added that in
compliance with their obligations under the contract, they have submitted a comfort letter
from UCPB to show petitioners that the bank was willing to finance the acquisition of the
Phimco shares.[21]
The basic issues to be resolved are: (1) whether the appellate court erred in reversing
the trial courts decision dismissing the complaint for being unenforceable under the
Statute of Frauds; and (2) whether there was a perfected contract of sale between
petitioners and respondents with respect to the Phimco shares.
The Statute of Frauds embodied in Article 1403, paragraph (2), of the Civil
Code[22] requires certain contracts enumerated therein to be evidenced by some note or
memorandum in order to be enforceable. The term Statute of Frauds is descriptive of
statutes which require certain classes of contracts to be in writing. The Statute does not
deprive the parties of the right to contract with respect to the matters therein involved, but
merely regulates the formalities of the contract necessary to render it
enforceable.[23] Evidence of the agreement cannot be received without the writing or a
secondary evidence of its contents.
The Statute, however, simply provides the method by which the contracts
enumerated therein may be proved but does not declare them invalid because they are
not reduced to writing. By law, contracts are obligatory in whatever form they may have
been entered into, provided all the essential requisites for their validity are present.
However, when the law requires that a contract be in some form in order that it may be
valid or enforceable, or that a contract be proved in a certain way, that requirement is
absolute and indispensable.[24] Consequently, the effect of non-compliance with the
requirement of the Statute is simply that no action can be enforced unless the requirement
is complied with.[25] Clearly, the form required is for evidentiary purposes only. Hence, if
the parties permit a contract to be proved, without any objection, it is then just as binding
as if the Statute has been complied with.[26]
The purpose of the Statute is to prevent fraud and perjury in the enforcement of
obligations depending for their evidence on the unassisted memory of witnesses, by
requiring certain enumerated contracts and transactions to be evidenced by a writing
signed by the party to be charged.[27]
 However, for a note or memorandum to satisfy the Statute, it must be complete in
itself and cannot rest partly in writing and partly in parol. The note or memorandum must
contain the names of the parties, the terms and conditions of the contract, and a
description of the property sufficient to render it capable of identification.[28] Such note or
memorandum must contain the essential elements of the contract expressed with
certainty that may be ascertained from the note or memorandum itself, or some other
writing to which it refers or within which it is connected, without resorting to parol
evidence.[29]
Contrary to the Court of Appeals conclusion, the exchange of correspondence
between the parties hardly constitutes the note or memorandum within the context of
Article 1403 of the Civil Code. Rossis letter dated 11 June 1990, heavily relied upon by
respondents, is not complete in itself. First, it does not indicate at what price the shares
were being sold. In paragraph (5) of the letter, respondents were supposed to submit their
final offer in U.S. dollar terms, at that after the completion of the due diligence process.
The paragraph undoubtedly proves that there was as yet no definite agreement as to the
price. Second, the letter does not state the mode of payment of the price. In fact, Litonjua
was supposed to indicate in his final offer how and where payment for the shares was
planned to be made.[30]
Evidently, the trial courts dismissal of the complaint on the ground of unenforceability
under the Statute of Frauds is warranted.[31]
Even if we were to consider the letters between the parties as a sufficient
memorandum for purposes of taking the case out of the operation of the Statute the action
for specific performance would still fail.
A contract is defined as a juridical convention manifested in legal form, by virtue of
which one or more persons bind themselves in favor of another, or others, or reciprocally,
to the fulfillment of a prestation to give, to do, or not to do.[32] There can be no contract
unless the following requisites concur: (a) consent of the contracting parties; (b) object
certain which is the subject matter of the contract; (c) cause of the obligation which is
established.[33] Contracts are perfected by mere consent, which is manifested by the
meeting of the offer and the acceptance upon the thing and the cause which are to
constitute the contract.[34]
Specifically, in the case of a contract of sale, required is the concurrence of three
elements, to wit: (a) consent or meeting of the minds, that is, consent to transfer
ownership in exchange for the price; (b) determinate subject matter, and (c) price certain
in money or its equivalent.[35] Such contract is born from the moment there is a meeting
of minds upon the thing which is the object of the contract and upon the price. [36]
In general, contracts undergo three distinct stages, to wit: negotiation; perfection or
birth; and consummation. Negotiation begins from the time the prospective contracting
parties manifest their interest in the contract and ends at the moment of agreement of the
parties. Perfection or birth of the contract takes place when the parties agree upon the
essential elements of the contract. Consummation occurs when the parties fulfill or
perform the terms agreed upon in the contract, culminating in the extinguishment
thereof.[37]
 A negotiation is formally initiated by an offer. A perfected promise merely tends to
insure and pave the way for the celebration of a future contract. An imperfect promise
(policitacion), on the other hand, is a mere unaccepted offer.[38] Public advertisements or
solicitations and the like are ordinarily construed as mere invitations to make offers or
only as proposals. At any time prior to the perfection of the contract, either negotiating
party may stop the negotiation.[39] The offer, at this stage, may be withdrawn; the
withdrawal is effective immediately after its manifestation, such as by its mailing and not
necessarily when the offeree learns of the withdrawal.[40]
An offer would require, among other things, a clear certainty on both the object and
the cause or consideration of the envisioned contract. Consent in a contract of sale should
be manifested by the meeting of the offer and the acceptance upon the thing and the
cause which are to constitute the contract. The offer must be certain and the acceptance
absolute. A qualified acceptance constitutes a counter-offer.[41]
Quite obviously, Litonjuas letter dated 21 May 1990, proposing the acquisition of the
Phimco shares for US$36 million was merely an offer. This offer, however, in Litonjuas
own words, is understood to be subject to adjustment on the basis of an audit of the
assets, liabilities and net worth of Phimco and its subsidiaries and on the final negotiation
between ourselves.[42]
Was the offer certain enough to satisfy the requirements of the Statute of Frauds?
Definitely not.
Litonjua repeatedly stressed in his letters that they would not be able to submit their
final bid by 30 June 1990.[43] With indubitable inconsistency, respondents later claimed
that for all intents and purposes, the US$36 million was their final bid. If this were so, it
would be inane for Litonjua to state, as he did, in his letter dated 28 June 1990 that they
would be in a position to submit their final bid only on 17 July 1990. The lack of a definite
offer on the part of respondents could not possibly serve as the basis of their claim that
the sale of the Phimco shares in their favor was perfected, for one essential element of a
contract of sale was obviously wantingthe price certain in money or its equivalent. The
price must be certain, otherwise there is no true consent between the parties. [44] There
can be no sale without a price.[45] Quite recently, this Court reiterated the long-standing
doctrine that the manner of payment of the purchase price is an essential element before
a valid and binding contract of sale can exist since the agreement on the manner of
payment goes into the price such that a disagreement on the manner of payment is
tantamount to a failure to agree on the price.[46]
Granting arguendo, that the amount of US$36 million was a definite offer, it would
remain as a mere offer in the absence of evidence of its acceptance. To produce a
contract, there must be acceptance, which may be express or implied, but it must not
qualify the terms of the offer.[47] The acceptance of an offer must be unqualified and
absolute to perfect the contract.[48] In other words, it must be identical in all respects with
that of the offer so as to produce consent or meeting of the minds. [49]
Respondents attempt to prove the alleged verbal acceptance of their US$36 million
bid becomes futile in the face of the overwhelming evidence on record that there was in
the first place no meeting of the minds with respect to the price. It is dramatically clear
that the US$36 million was not the actual price agreed upon but merely a preliminary offer
which was subject to adjustment after the conclusion of the audit of the company finances.
Respondents failure to submit their final bid on the deadline set by petitioners prevented
the perfection of the contract of sale. It was not perfected due to the absence of one
essential element which was the price certain in money or its equivalent.
At any rate, from the procedural stand point, the continuing objections raised by
petitioners to the admission of parol evidence[50] on the alleged verbal acceptance of the
offer rendered any evidence of acceptance inadmissible.
Respondents plea of partial performance should likewise fail. The acquisition audit
and submission of a comfort letter, even if considered together, failed to prove the
perfection of the contract. Quite the contrary, they indicated that the sale was far from
concluded. Respondents conducted the audit as part of the due diligence process to help
them arrive at and make their final offer. On the other hand, the submission of the comfort
letter was merely a guarantee that respondents had the financial capacity to pay the price
in the event that their bid was accepted by petitioners.
The Statute of Frauds is applicable only to contracts which are executory and not to
those which have been consummated either totally or partially. [51] If a contract has been
totally or partially performed, the exclusion of parol evidence would promote fraud or bad
faith, for it would enable the defendant to keep the benefits already derived by him from
the transaction in litigation, and at the same time, evade the obligations, responsibilities
or liabilities assumed or contracted by him thereby. [52] This rule, however, is predicated
on the fact of ratification of the contract within the meaning of Article 1405 of the Civil
Code either (1) by failure to object to the presentation of oral evidence to prove the same,
or (2) by the acceptance of benefits under them. In the instant case, respondents failed
to prove that there was partial performance of the contract within the purview of the
Statute.
Respondents insist that even on the assumption that the Statute of Frauds is
applicable in this case, the trial court erred in dismissing the complaint altogether. They
point out that the complaint presents several causes of action.
A close examination of the complaint reveals that it alleges two distinct causes of
action, the first is for specific performance[53] premised on the existence of the contract of
sale, while the other is solely for damages, predicated on the purported dilatory
maneuvers executed by the Phimco management.[54]
With respect to the first cause of action for specific performance, apart from
petitioners alleged refusal to honor the contract of salewhich has never been perfected in
the first placerespondents made a number of averments in their complaint all in support
of said cause of action. Respondents claimed that petitioners were guilty of promissory
estoppel,[55] warranty breaches[56] and tortious conduct[57] in refusing to honor the alleged
contract of sale. These averments are predicated on or at least interwoven with the
existence or perfection of the contract of sale. As there was no such perfected contract,
the trial court properly rejected the averments in conjunction with the dismissal of the
complaint for specific performance.
 However, respondents second cause of action due to the alleged malicious and
deliberate delay of the Phimco management in the delivery of documents necessary for
the completion of the audit on time, not being based on the existence of the contract of
sale, could stand independently of the action for specific performance and should not be
deemed barred by the dismissal of the cause of action predicated on the failed contract.
If substantiated, this cause of action would entitle respondents to the recovery of
damages against the officers of the corporation responsible for the acts complained of.
Thus, the Court cannot forthwith order dismissal of the complaint without affording
respondents an opportunity to substantiate their allegations with respect to its cause of
action for damages against the officers of Phimco based on the latters alleged self-serving
dilatory maneuvers.
WHEREFORE, the petition is in part GRANTED. The appealed Decision is hereby
MODIFIED insofar as it declared the agreement between the parties enforceable under
the Statute of Frauds. The complaint before the trial court is ordered DISMISSED insofar
as the cause of action for specific performance is concerned. The case is ordered
REMANDED to the trial court for further proceedings with respect to the cause of action
for damages as above specified.
SO ORDERED. Puno, J., (Chairman), Austria-Martinez, Callejo, Sr. and Chico-
Nazario, JJ., concur.
G.R. No. 193453 June 5, 2013

SPOUSES RUBIN AND PORTIA HOJAS, Petitioners,

vs.
PHILIPPINE AMANAH BANK AND RAMON KUE, Respondents.

DECISION

MENDOZA, J.:

This is a petition for review on certiorari assailing the July 28, 2010 Decision 1 of the
Court of Appeals (CA), in CA-G.R. CV No. 55722, which affirmed the May 27, 1996
Decision of the Regional Trial Court, Branch 13, Zamboanga City (RTC), dismissing
Civil Case No. 1028 (3952), an action for "Determination of True Balance of Mortgage,
Debt, Annulment/Setting

Aside of Extrajudicial Foreclosure of Mortgage and Damages, with Prayer for

Preliminary Injunction."

The petitioners, Spouses Rubin and Portia Hojas (petitioners), alleged that on April 11,
1980, they secured a loan from respondent Philippine Amanah Bank (PAB) in the
amount of P450,000.00; that this loan was secured by a mortgage, covering both
personal and real properties; that from May 14, 1981 to June 27, 1986, they made
various payments amounting to P486,162.13; that PAB, however, did not properly credit
their payments; that based on the summary of payments furnished by PAB to them on
February 24, 1989, only 13 payments were credited, erroneously amounting
to P317,048.83; that PAB did not credit the payment they made totaling P165,623.24;
and that, in the statement of their account as of October 17, 1984, PAB listed their total
payment as 412,211.54 on the principal, and P138,472.09 as 30% interest, all
amounting to P550,683.63, despite the fact that at that time, petitioners had already
paid the total sum of P486,162.13.2

Petitioners further averred that for failure to pay the loan, PAB applied for the
extrajudicial foreclosure of the mortgaged real properties of petitioners with the Ex-
Officio Sheriff; that consequently, a Notice of Extrajudicial Foreclosure was issued on
January 12, 1987 setting the foreclosure sale on April 21, 1987 and, stating therein the
mortgage debt in the sum of P450,000.00; and that, in the public auction conducted,
PAB acquired said real property.3

It was further alleged that on March 9, 1988, through the intervention of then Senator
Aquilino Pimentel, Farouk A. Carpizo (Carpizo), the OICPresident of PAB, wrote
Roberto Hojas (Roberto), petitioners son, informing him that although the one-year
redemption period would expire on April 21, 1988, by virtue of the banks incentive
scheme, the redemption period was extended until December 31, 1988; that despite
said letter from the OIC-President, the OIC of the Project Development Department of
PAB wrote Rubin Hojas that the real properties acquired by PAB would be sold in a
public bidding before the end of August, 1988; that on November 4, 1988, a public
bidding was conducted; that in the said bidding, the mortgaged properties were
awarded to respondent Ramon Kue (Kue); that subsequently, they received a letter
from the OIC of the Project Development Department, dated January 3, 1989, informing
them that they had fifteen (15) days from receipt within which to vacate the premises;
that Kue then sent another letter, dated January 31, 1989, informing them that he had
already acquired the said property and that they were requested to vacate the premises
within fifteen (15) days from receipt thereof;4 and that because of this development, on
May 7, 1991, petitioners filed an action for "Determination of True Balance of Mortgage
Debt, Annulment/Setting Aside of Extrajudicial Foreclosure of Mortgage and Damages,
with Prayer for Preliminary Injunction" against PAB.5

On May 27, 1996, the RTC dismissed petitioners complaint. It ruled, among others,
that: 1) PAB was not guilty of bad faith in conducting the extrajudicial foreclosure as it,
at one time, even suspended the conduct of the foreclosure upon the request of
petitioners, who, nevertheless, failed to exert effort to settle their accounts; 2) because
petitioners failed to redeem their properties within the period allowed, PAB became its
absolute owner and, as such, it had the right to sell the same to Kue, who acquired the
property for value and in good faith; and 3) the subsequent foreclosure and auction sale
having been conducted above board and in accordance with the requisite legal
procedure, collusion between PAB and Kue was certainly alien to the issue. 6

Aggrieved, petitioners filed an appeal assailing the May 27, 1996 RTC Decision. They
asserted that the March 9, 1988 Letter of Carpizo to Roberto Hojas extended the
redemption period from April 21 to December 31, 1988. Considering that they had relied
on Carpizos representation, PAB violated the principle of estoppel when it conducted
the public sale on November 4, 1988.7 Their basis was the portion of said letter which
stated:

xxxx

As the Bank has adopted an incentive scheme whereby payments are liberalized to give
chances to former owners to repossess their properties, we suggest that you advise
your parents to drop by at our Zamboanga Office so they can avail of this rare privilege
which shall be good only up to December 31, 1988. (Emphasis supplied)8

The CA was not sympathetic with petitioners position. It held that the period of
redemption was never extended. The date "December 31, 1988" was not an extension
of the redemption period. It was merely the last day for the availment of the liberalized
payment for the repossession of foreclosed assets under PABs incentive scheme. PAB,
through said letter, did not make an unqualified representation to petitioners that it had
extended the redemption period. As such, PAB could not be said to have violated the
principle of estoppel when it conducted a public sale on November 4, 1988. 9 Thus, the
dispositive portion of the CA decision reads:

ACCORDINGLY, the instant appeal is DENIED. The Decision dated May 27, 1996, of
the Regional Trial Court, 9th Judicial Region, Branch No. 13 of Zamboanga City, in Civil
Case No. 1028 (3952), is AFFIRMED.

SO ORDERED.10

Undaunted, petitioners filed the present petition for review. It postulated the sole issue:

WHETHER OR NOT THE CA ERRED IN NOT HOLDING PAB TO HAVE VIOLATED

THE PRINCIPLE OF ESTOPPEL WHEN THE LATTER CONDUCTED THE
NOVEMBER 4, 1988 PUBLIC SALE.

Petitioners reiterated their argument that the November 4, 1988 public sale by PAB was
violative of the principle of estoppel because said bank made it appear that the one-year
redemption period was extended. As such, when PAB sold the property before said
date, they suffered damages and were greatly prejudiced.11 They also argued that since
they manifested their interest in availing of the said "incentive scheme," PAB should
have, at the very least, waited until December 31, 1988, before it sold the subject
foreclosed property in a public auction.12

On the other hand, PAB explains that the purpose of the "incentive scheme" was to give
previous owners the chance to redeem their properties on easy payment term basis,
through condonation of some charges and penalties and allowing payment by
installment based on their proposals which may be acceptable to PAB. Therefore, the
March 9, 1988 Letter of Carpizo was an invitation for petitioners to submit a proposal to
PAB.13 It was not meant to extend the one-year redemption period.

As early as August 11, 1988, PAB wrote petitioners informing them of the scheduled
public bidding. After receipt of the letter, petitioners went to PAB to signify their
willingness to avail of the said incentive scheme. They, however, failed to submit a
proposal. In fact, PAB did not hear from petitioners again. As such, the respondent sold
the subject property in a public sale on November 4, 198814 PAB cited the RTCs finding
that although the petitioners manifested their intention to avail of the incentive scheme
desire alone was not sufficient. Redemption is not a matter of intent but involved making
the proper payment or tender of the price of the land within the specified period. 15

The petition is bereft of merit.

Through estoppel, an admission or representation is rendered conclusive upon the

person making it, and cannot be denied or disproved as against the person relying on
it.16 This doctrine is based on the grounds of public policy, fair dealing, good faith, and
justice and its purpose is to forbid one to speak against his own act, representations or
commitments to the injury of one to whom they were directed and who reasonably relied
on it.17 Thus, in order for this doctrine to operate, a representation must have been
made to the detriment of another who relied on it. In other words, estoppel would not lie
against one who, in the first place, did not make any representation.

In this case, a perusal of the letter, on which petitioners based their position that the
redemption period had been extended, shows otherwise. Pertinent portions of the said
letter read:

xxxx

Our records show that the above account has already been foreclosed by the bank.
However, the borrowers concerned can still exercise the one (1) year right of
redemption over the foreclosed properties until April 21, 1988.

As the Bank has adopted an incentive scheme whereby payments are liberalized to give
chances to former owners to repossess their properties, we suggest that you advise
your parents to drop by at our Zamboanga Office so they can avail of this rare privilege
which shall be good only up to December 31, 1988. [Emphases and Underscoring
Supplied]18

As correctly held by the RTC and upheld by the CA, the date "December 31, 1988"
refers to the last day when owners of foreclosed properties, like petitioners, could
submit their payment proposals to the bank. The letter was very clear. It was about the
availment of the liberalized payment scheme of the bank. On the last day for
redemption, the letter was also clear. It was April 21, 1988. It was never extended.

The opportunity given to the petitioners was to avail of the liberalized payment scheme
which program would expire on December 31, 1988. As explained by Abraham Iribani
(Iribani), the OIC of the Project Development Department of PAB, it was to give a
chance to previous owners to repossess their properties on easy term basis, possibly by
condonation of charges and penalties and payment on instalment. The letter of Carpizo
was an invitation to the petitioners to come to the bank with their proposal. It appears
that the petitioners could not come up with a proposal acceptable to the bank.

For said reason, the mortgaged property was included in the list of mortgaged
properties that would be sold through a scheduled public bidding. Thus, on August 11,
1988, Iribani wrote the petitioners about the scheduled bidding. In response, the
petitioners told Iribani that they would go Manila to explain their case. They did not,
however, return even after the public bidding. In this regard, the CA was correct when it
wrote:

Here, there is no estoppel to speak of. The letter does not show that the Bank had
unqualifiedly represented to the Hojases that it had extended the redemption period to
December 31, 1988. Thus, the Hojases have no basis in positing that the public sale
conducted on November 4, 1988 was null and void for having been prematurely
conducted.19
Moreover, petitioners allegation that they had signified their intention to avail of the
incentive scheme (which they have equated to their intention to redeem the property),
did not amount to an exercise of redemption precluding the bank from making the public
sale.20 In the case of China Banking Corporation v. Martir,21 this Court expounded on
what constitutes a proper exercise of the right of redemption, to wit:

The general rule in redemption is that it is not sufficient that a person offering to redeem
manifests his desire to do so. The statement of intention must be accompanied by an
actual and simultaneous tender of payment. This constitutes the exercise of the right to
repurchase.

In several cases decided by the Court where the right to repurchase was held to have
been properly exercised, there was an unequivocal tender of payment for the full
amount of the repurchase price. Otherwise, the offer to redeem is ineffectual. Bona fide
redemption necessarily implies a reasonable and valid tender of the entire repurchase
price, otherwise the rule on the redemption period fixed by law can easily be
circumvented.

Moreover, jurisprudence also characterizes a valid tender of payment as one where the
full redemption price is tendered. Consequently, in this case, the offer by respondents
on July 24, 1986 to redeem the foreclosed properties for 1,872,935 and the
subsequent consignation in court of P1,500,000 on August 27, 1986, while made within
the period of redemption, was ineffective since the amount offered and actually
consigned not only did not include the interest but was in fact also way below
the P2,782,554.66 paid by the highest bidder/purchaser of the properties during the
auction sale.

In Bodiongan vs. Court of Appeals, we held:

In order to effect a redemption, the judgment debtor must pay the purchaser the
redemption price composed of the following: (1) the price which the purchaser paid for
the property; (2) interest of 1% per month on the purchase price; (3) the amount of any
assessments or taxes which the purchaser may have paid on the property after the
purchase; and (4) interest of 1% per month on such assessments and taxes x x x.

Furthermore, Article 1616 of the Civil Code of the Philippines provides:

The vendor cannot avail himself of the right to repurchase without returning to the
vendee the price of the sale x x x.

It is not difficult to understand why the redemption price should either be fully offered in
legal tender or else validly consigned in court. Only by such means can the auction
winner be assured that the offer to redeem is being made in good faith.1wphi1

Respondents' repeated requests for information as regards the amount of loan availed
from the credit line and the amount of redemption, and petitioner's failure to accede to
said requests do not invalidate the foreclosure. Respondents can find other ways to
know the redemption price. For one, they can examine the Certificate of Sale registered
with the Register of Deeds to verify the purchase price, or upon the filing of their
complaint, they could have moved for a computation of the redemption price and
consigned the same to the court. At any rate, whether or not respondents '"were diligent
in asserting their willingness to pay is irrelevant. Redemption within the period allowed
by law is not a matter of intent but a question of payment or valid tender of the full
redemption price within said period.

Even the complaint instituted by respondents cannot aid their plight because the
institution of an action to annul a foreclosure sale does not suspend the running of the
redemption period. (Underscoring supplied)22

In the case at bench, the record is bereft of concrete evidence that would show that,
aside from the fact that petitioners manifested their intention to avail of the scheme, they
were also ready to pay the redemption price. Hence, as they failed to exercise their right
of redemption and failed to take advantage of the liberalized incentive scheme, PAB
was well within its right to sell its property in a public sale.

WHEREFORE, the petition is DENIED.

SO ORDERED.

JOSE CATRAL MENDOZA

Associate Justice

WE CONCUR:

PRESBITERO J. VELASCO, JR.

Associate Justice
Chairperson