0.

10"

Reyes owned 600-meter lot and sold 300-meters to Sps. Villamor for 21,000.00. Macaria
Villamor v. CA borrowed 2,000.00 from Sps. Villamor and this was deducted from the total purchase price.
Deed of Option in favor of Villamor in which the remaining 300-meter potion would be sold to
A Unique Option Villamor under some conditions
Contract granting both The only reason why Sps. Villamor agreed to purchase it as 70 per sqm (which is higher than
parties the options to the prevailing market price) is because Reyes promised Sps. Villamor that they would sell to
buy/sell. Action to them the remaining 300-meter part of the land
demand performance When Reyes retired, Macaria Reyes offered Sps. Villamor that they will repurchase the land.
already prescribed (10 Villamors claimed that they already offered to purchase the remaining 1/2 under the Deed of
year based on written Option. They filed for a Specific Performance against the Reyeses.
contract)
Issue : Is the Deed of Option a valid agreement?
The overprice is given in the Deed as reason for the desire of Sps. Villamor to acquire the land
rather than as a consideratin for the option given to them, although one might wonder why
they took nearly 13 years to invoke their right if they really were in due need of the lot.
Consideration is the why of the contracts, the essential reason which moves the
contracting parties to enter into the contract
Deed of Option (in this case, a unique optional contract) : First part-buying at 70.00 which is
higher than the prevailing market price ; Second part - Buying only because Reyes agreed to
sell the remaining 1/2. If it stopped there = Ordinary Deed of Option
HOWEVER, the phrase "whenever the need of such sale arises, on either Reyes or Sps.
Villamor" = Option to buy granted to Villamors and Option to Sell granted to Reyeses
Since thre was a meeting of minds = there was already a perfected Contract of Sale
What was left was for either party to DEMAND from the other their respective undertakings.
Deed of Option did not provide for a period. Failure of either parties to demand performance of
the obligation of the other = renders the contract ineffective
Prescription : Art. 1144 Upon a written contract (10 years)

It was a Contract to Sell. The intention of the parties is the ultimate indicator of the type of
Contract.
The title of a contract does not necessarily determine its true nature.
Option : a continuing offer by which the owner stipulates with another that the latter shall have
Respondents and Jose and Dominador Jimenez were the registered co-owners of a parcel of
the right to buy the property at a fixed price; or which gives to the owner of the property the
land.
Adelfa Properties v. right to sell or demand a sale. "an unaccepted offer"
Jose and Dominador sold to Adelfa Properties the eastern portion under a Kasulatan sa
CA, Rosario Jimenez- An option is NOT of itself a purchase, but merely SECURES the privilege to buy. It
Bilihan ng Lupa
Castaneda and Salud imposes no binding obligation on the person holding the option, aside from the consideration
Adelfa Properties expressed interest in buying the western portion = Exclusive Option to
Jimenez for the offer.
Purchase was executed between Ps and Rs (50,000.00 as option money shall be credited as
A Contract of Sale : fixes definitely the relative rights and obligations of both parties at the
partial payment)
Test if the Contract is time of its execution. The offer and acceptance are concurrent.
Petitioner caused to be annotated on the title of the lot its option contract with
a Contract of Sale or A The Contract created an obligation for Adelfa Properties to pay the purchase price. It did not
respondents and its contract of sale with Jose and Dominador Jimenez
Mere Option: Whether merely give petitioner discretion to pay for the property. There is nothing in the said contract to
Deed of Conditional Sale : Private respondents executed in favor of Emylene Chua
or not the agreement show that petitioner was merely given a certain period within which to exercise its privilege to
could be specifically buy,
Issue : Was it a Contract to Sell or an Option Contract?
enforced. An agreement is merely an OPTION when no obligation rests on the party to make any
payment except such as may be agreed on as consideration to support the option until
he has made up his mind
Earnest money of 50,000.00 shall be considered as a part of the price and proof of the
perfection of the contract. Considered as advance payment and must be deducted from the
total price.

San MIguel Properties offered to sell two parcels of land to Sps. Huang. Atty. Dauz signified
the interst of Sps. Huang to purchase the properties
500,000.00 would be given as earnest money and the balance would be paid in 8 equal
monthly installments. San MIguel Properties refused the counter-offer.
San MIguel Properties
A letter was sent to San MIguel Properties with 1,000,000.00 as earnest-deposit money with
v. Sps. Huang
conditions : 1) Sps. Huang shall be given the exclusive option to purchase the property within
30 days from the date of San MIguel Properties' acceptance of offer
Deposit is not earnest
The parties failed to agree on the terms and conditions of the sale despite the extension
money if the contract
granted by San MIguel Properties = San MIguel Properties is returning the 1,000,000.00
had not been
given as earnest-deposit
perfected at the time
San MIguel Properties : Sps. Huang's option to purchase had already expired ; the exclusive
that it was given
option lacked a consideration separate and distinct from the purchase price and was
thus unenforceable
Issue : Was there a perfected Contract of Sale or Option Contract?
The 1,000,000.00 was not earnest money but only as a guarantee that Sps. Huang would not
back out of the sale.
First condition : Option period of 30 days shows that the sale was never perfected. The
acceptance of the condition merely gave rise to an option or an accepted unilateral
promise of Sps. Huang to purchase the subject property
Such option is separate and distinct from the contract of sale which the parties may enter
Article 1479 : An accepted unilateral promise to buy or sell a determinate thing for a
price certain is binding upon the promisor only if the promise is supported by a distinct
consideration.
Consideration in an option contract may be anything of value.
The parties never got pass the negotiation stage
Disagreement on the manner of payment = failure to agree on the price
It is not the giving of earnest money, but the proof of the concurrence of all the essential
elements of the Contract of Sale which establishes the existence of a perfected sale

Sps. De Vera offered to sell a parcel of land to Limson. Limson agreed to buy the property and
gave 20,000.00 as earnest money.
Sps. De Vera signed a receipt and gave Limson 10-day option period to purchase the
property
Sps. De Vera informed Limson that the property was mortgaged to Emilio Ramos and Isidro
Ramos
Limson v. CA and Sps. The amount was purportedly considered part of purchase price and respondent De Vera
De Vera signed the receipts thereof.
Limson was surprised that the property was the subjet of negotiation for the sale to Sunvar
Earnest Money v. Realty Development Corporation (SUNVAR)
Option Money Deed of Sale executed between Sps. Vera and SUNVAR with adverse claim in favor of
Limson
Limson : Her valid and legal right to purchase the property was ignored
Sps. De Vera : The option to buy the property for Limson had long expired
SUNVAR : Did not know nor was informed of Limson's interest over the property
Issue : What is the nature of the contract between Limson and Sps. De Vera
Limson : There was a perfected contract of sale
Sps. De Vera,SUNVAR,Cuenca : What was perfected between Limson and Sps. De Vera was
a mere option.
Evidence show a Contract of Option.
Receipt Issued : 20k as earnest money with option to purchase a parcel of land.
(a) earnest money is part of the purchase price, while option money is the money given as a
distinct consideration for an option contract;
(b) earnest money given only where there is already a sale, while option money applies to a
sale not yet perfected; and,
(c) when earnest money is given, the buyer is bound to pay the balance, while when the
would-be buyer gives option money, he is not required to buy,18 but may even forfeit it
depending on the terms of the option.
The option period expired = purchase by SUNVAR was perfectly valid and entered into in
good faith

NO.
Liamson et. al executed a Deed of Assignment in favor of Tayag + was granted the exclusive
Option is a contract by which the owner of the property agrees with another person that he
right to buy the property. They assigned all their rights and interests on their landholdings to
Tayag v. Lacson shall have the right to buy his property at a fixed price within a certain time.
Tayag
Liamson et.al. were merely tenants and not the registered owners of the property. NOT being
Amount: 50.00 per square meter payable when th legal impediments to the sale of the
An Option Contract the registered owners, they could not legally grant to the petitioner the option, much less, the
property to Tayag no longer existed (as they were beneficiaries of the CARP)
cannot be offered by a exclusive right to buy the property.
Liamson et. al informed Tayag that they were no longer selling the property and were instead
person who is not the Tayag's purpose in having Liamson et.al to execute the Deed of Ssignment because he knew
selling it to Lacson
owner of the property that in the event that Lacson agreed to sell the property to him. If Lacson agreed to sell the
property, Liamson et.al. shall have preferential right to buy the same.
Issue : Is there a valid Option Contract?

The Court affirms the constitutionality of the Agreement.

An Option Contract must be supported by a separate consideration that is either clearly
Keppel entered into a leas agreement with Lusteveco
Philippine National Oil specified as such in the contract or duly proven by the offeree/promisee
End of 25-year lease : Keppel was given the firm and absolute option to purchase the land for
v. Keppel Holdings Option Contract - the subject matter is the right or privilege to buy a determinate thing for a
4.09 Million, provided that it had acquired the necessary qualification to own land under
price certain ; consent is the acceptance by the offeree of the offeror's promise to sell the
Philippine laws at the time the option is exercised
Not an Option Contract determinate thing ; consideration may be anyting of value
If Keppel remained unqualified = automatic renewal of the lease agreement for another 25
for the absence of a Sales Contract - the subject matter is the determinate thing itself ; acceptance of the offer
years. Keppel was allowed to exercise the option to purchase the land up to the 30th year of
separate consideration itself where the offeree asserts his/her right or privilege to buy ; purchase price must be in
the lease
but remains an offer, money or its equivalent
Lusteveco warranted not to sell the land or assign its rights to the land for the duration of the
that if duly accepted,
lease unless with the prior written consent of Keppel
generates into a The Court considered the additional concessions stipulated in the agreement to constitute a
When PNOC acquired the property, Keppel did not object as long as the agreement was
contract to sell where sufficient separate consideration for the option contract.
annotated on PNOC's title
the parties' respective The consideration for the option contract should be clearly specified as such in the
2000 : at least 60% of Keppel's shares are now owned by Filipinos = ready to exercise the
obligations become option contract or clause. Otherwise, the offeree must bear the burden of proving that a
option to purchase the land
reciprocally SEPARATE consideration for the option contract exists
demandable
Issue : Is it an Option Contract?
Keppel timely accepted the offer to buy the land = a Contract to Sell the land ensued which
Keppel can rightfully demand PNOC to comply with