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2016
SALES DIGESTS BLOCK 2B 2016

Compiled by: Gil Arandia


Pucha nasa board pa talaga yung procurator in rem suan
(Photo is for those people na may crush kay ma’am hahaha)
BLOCK B 2016
BLOCK
SALES DIGESTS BLOCK 2B 2016 2016 B
Table of
Contents LTD. vs. Jose
Chapter 1: B. LINGAD..........
Nature of a
Sale........................................................................
Lo v. KJS..............
GAITE v.
FONACIER Chapter 2:
...........................................................................
Parties to a
Contract of Sale
CELESTINO ..............................
CO &
DOMINGO v
COMPANY
CA.......................
vs.
COLLECTOR PARAGAS v.
HEIRS of
OF
BALACANO
INTERNAL ..........................
REVENUE...........................................................
CALIMLIM-
COMMISSI CANULLAS v.
ONER OF FORTUN.............
INTERNAL
MATABUEN
REVENUE v
Av
ENGINEERI CERVANTES
NG ..........................
EQUIPMEN
PHILIPPINE
T & SUPPLY
TRUST CO. V
CO......................................................................
ROLDAN.............
QUIROGA Macariola v
BLOCKB2016

V PARSONS Asuncion.............
...........................................................................
DOMINGO
Puyat v
D.RUBIAS vs.
Arco...................................................................
ISAIAS
KER & CO. BATILLER............
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 2
MANANSALA VS COURT OF APPEALS...........................................
DAROY V ABECIA...................................................................... Mate v. CA..........................................................................
of Catalina Roque.............
Pio Sian Melliza vs. City of Iloilo, University
Chapter 3: Subject Matter of a of the Philippines and Yu Bun Guan vs Ong v. Ong........................
the Court of Appeals (1968)............................................................
Contract of Sale............................................................................. Elvira Ong............................................................................
Atilano vs. Atilano (May 21, 1969).................................................. Bagnas v. CA......................
SIBAL Vs VALDEZ....................................................................... Vda Catindig v Heirs
Yu Tek & Co vs. Basilio Gonzales.....................................................
PICHEL V. ALONZO.................................................................... SALES DIGESTS
NATIONAL GRAINS AUTHORITY
and WILLLAM CABAL vs. THE BLOCK 2B 2016
Republic v Carceller v.
INTERMEDIATE APPELLATE Phil.
COURT and LEON SORIANO,..................................................... Resources Court of
Developme Appeals................
JOHANNES SCHUBACK & SONS nt..........................................................................
Chapter 5: Tayag vs
PHILIPPINE TRADING Formation of a Lacson................
CORPORATION vs. THE HON. Contract of
Sale...........................................................................
Sanchez v.
COURT OF APPEALS....................................................................
Manila Rigos...................
CONCHITA NOOL and Metal
Container Diamante v.
GAUDENCIO ALMOJERA vs.
Corporatio CA.......................
COURT OF APPEALS, ANACLETO
n vs Vazquez v. CA
NOOL and EMILIA NEBRE................................................................ Philippine
............................
Chapter 4: Price and Other Consideration...................................... National
Bank Nietes vs. CA
Mitsui Bussan Kaisha vs. Manila ............................
..................
Electric Railroad and Light .................. Ang Yu
Company.................................................................................... ..................
Asuncion vs.
.................. Court of
VILLANUEVA V. CA.....................................................................
.................. Appeals..............
JOSE R. MORENO, JR. vs Private Management ....53
Office........................................................................................... Equatorial
United Realty v.
Navarra v. Planters Development Bank.......................................... Muslim and Mayfair
Christian
Mapalo v. Mapalo.......................................................................... Theater................
Urban Poor
Rongavilla v. CA......................................................................... Association Paranaque
Kings vs Court
v. BRYC...............................................................
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 3
Secuya v. Selma.............................................................................
of Appeals....................................................................................
YUVIENCO vs Dacuycuy..............................................................
Vazquez v. Ayala Corporation.....................................................
Limketkai Sons Milling Inc. v CA.....................................................
Limketkai v. CA (MR- 1996).........................................................
RIVIERA FILIPINA vs. CA............................................................
Ortega v. Leonardo..................................................................
Macion v. Guiani..........................................................................
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Claudel vs CA..............................................................................
Uraca v. CA...................................................................................
Alfredo v. Borras.........................................................................
Villonco v. Bormaheco...................................................................
Toyota Shaw Inc. v. CA.............................................................
Oesmer v. Paraiso..........................................................................
Chapter 6- Obligations of the Seller...................................................
ADELFA PROPERTIES, INC vs CA.................................................
Santos v. Santos......................................................................
Fule v. CA......................................................................................
Dy Jr. v. CA..............................................................................
Dalion v. CA...................................................................................
Addison v. Felix............................................................................
Danguilan v. IAC..........................................................................
Pasagui v. Villablanca...............................................................
Power Commercial and Industrial Corp. v. CA
...............................................................................................
Chua v CA...............................................................................
Vive Eagle Land Inc v CA..............................................................
Behn, Meyer Co. v Yangco...........................................................
General Foods Corp v. NACOCO..............................................
Rudolf Leitz Inc v. CA................................................................

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 4
Chapter 1: Nature of a Sale SALES DIGESTS BLOCK 2B 2016 BLOCK
2016 B
obligation. By virtue of the sale being onerous, the favored GAIT ney
E v.
FON in-
ACIE fact
R
Facts: In
ligh
of
onaci the
er, app
owne intm
r/hol ent,
der of Gait
11 exe
iron uted
lode a
miner gen
al ral
claim assi
s nme
execu nt
ted a con
deed eyin
of the
assign use
ment and
appoi dev
nting opm
Gaite ent
r as of
his Fon
attor cier
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 4
interpretation of its terms favor the
mining onacier balance. The sureties expired greater reciprocity of interests. d
Hence, the buyer’s obligation exists, only
claims then and Fonacier defaulted. its due date is postponed. o d
into revoked Fonacier alleged that he is to e o
Larap the pay the balance only when the s o
iron authority suspensive condition has been CELESTINO CO & r
mines granted fulfilled. n s
COMPANY vs. COLLECTOR
owned to Gaite. o ,
Issue(s): OF INTERNAL REVENUE
by Gaite t
Facts:
Gaite assented s
1. W/N the payment is
himself , but subject to a suspensive Celestino Co & Company, m a
.
BLOCKB2016

with the condition registered under the trade a s


Therea condition name “Oriental Sash Factory, n h
fter, that he Held: markets itself as u
Gaite receive “Manufacturers of all kinds of f a
There was no
develo royalties doors, windows, sashes, a n
suspensive condition, only a
ped and furniture, etc. used season- c d
suspensive period. The sale or
and P75,000 dried and kiln-dried lumber, t
used shipment is not a condition for
for the the payment of the balance; it of the best quality u w
the iron ores workmanships.” From 1946 to r i
mining was merely to fix the future
already date of payment. 1951, it paid taxes equivalent e n
claim.
extracted According to the SC, a contract to 7% on the gross receipts d
In time,
. of sale is normally commutative under Sec. 186 of the r o
he
Fonacier NIRC(National Internal e w
extract and onerous, and that the
then Revenue Code), which is a tax a s
ed parties thereto assume a
issued 2 on the original sales of articles d
24,000 correlative
sureties by manufacturer, producer or y f
metric
good for importer. - o
tons of
1 year to However, in 1952 it began to pay only 3% m r
iron tax under Sec. 191, which
answer a
ore. is a tax on sales of services.
for the d t
F P65,000 Petitioner claims that it e h
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 5
e de ng, but only in sales of receive orders for windows
doors,
rs services. doors and windows as it has
represented
in its
p fr of special design stationery
Issue: Whether the and
u o only in particular advertisemen
ts to
petitioner’s claim is the
b m cases but the bulk
correct, that it is merely That
l th of their sales is
a special service
i e derived from a "manufacture
provider – NO.
c cu ready-made doors s"
, st Held: and windows of is
b o standard sizes for admitted
u m 1. As a general the average home. appellant
t er rule, “factories” Celestino itself.
o s, fact
SA
n he windows
l nc LE doors
y e, S made
it when
u is
DI customers
p no GE place
o t orders
ST
n en not alter
ga S nature
s ge BL establishmen
p d t.
e in
OC 2.
c m K
i an 2B
a uf
l ac 20
o tu 16
r ri Co & Company habitually makes sash,
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 6
o e appellant will not to Don Toribio Teodoro & sold R
the
r p refuse, for it can easily Co. because it also mate
u duplicate or even mass- rials.
Also, O
d rc produce the same 1
A contract for the delivery at a the F
e h doors. certain price of an article which order
the vendor in the ordinary course
s
r a herei
3. The nature of the of his business manufactures or n I
e s
work they do does procures for the general market, exhib N
d e ited
whether the same is on hand at
it not fall within the were T
the not
definition of a show E
b p n to
be
y construction work “spec R
r ial”
as
contractor the N
o articl
enumerated in e
i vi expre A
ssed.
section 191 of the They
t d L
were
, e NIRC
mere
d 4. Appellant invokes ly R
m h order
Article 14671 of the E
a e s for
New Civil Code to work. V
y p bolster its contention E
a C
that in filing orders for
N
BLOCKB2016

i y O
windows and doors
d s M U
according to
e t M E
specifications, it did
n h not sell, but merely I
t e v
contracted for S
i p particular pieces of S
c ri E
work or "merely sold I
a c its services". O N
l e. HOWEVER, Oriental G
l T N
Sash Factory did not I
y h E
merely sell its services
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 7
N O air-conditioning systems. and not manufacturers, and
E . On July 27, 1956, certain thus, should only be liable
E FACTS: Juan de la Cruz wrote to for the 3% tax on sales of
the CIR denouncing EES services or pieces of work.
R
Engi for tax evasion. Pursuant The Court of Tax Appeals
I nee to Section 1852 of the Tax reversed the order of the
N ring Code, EES was assessed CIR, declaring that EES is a
G Equi by the CIR for 30% contractor.
pme advanced sales tax plus Hence, this appeal.
E nt & surcharges (of 25% and
Q Sup 50%) for misdeclaring its
U ply importation of air ISSUE: W/N EES is a
(EES conditioning units and
I manufacturer of air
) parts and accessories. EES
P conditioning units under
was appealed to Court of Tax
M Section 185 of the Code or
eng Appeals (CTA), arguing
E a contractor (piece of
age that they are contractors
N work) under Section 191.
d in
time or not, is a contract of sale, but if the goods are to be
T the manufactured specially for the 2
busi Sec 185. There shall be levied,
customer and upon his special
assessed and collected once
& nes order, and not for the general
only on every original sale,
s of market, it is contract for a piece barter, exchange, or similar
desi of work. transaction intended to transfer
S
ownership of…a tax equivalent
U gnin
to 30% of the gross selling
g
P price….
and
P
inst
L
allin
Y g
cent
C ral
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 8
BLOCK
SALES DIGESTS BLOCK 2B 2016 2016 B
HELD:. EES is Such
a contractor,
subject to tax differen
stated in ce is
Section 191
of tested
the Code.
by the
inquiry
 There of
is a whethe
distin r the
ction thing
betw transfer
een a red is
contr one not
act of in
sale existenc
(man e and
ufact which
urer) never
and a would
contr have
act existed
for but for
furnis the
hing order of
servic the
es, party
labor desiring
and to
mate acquire
rials. it, or a
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 6
thing which would have pursuit of the design of cal
the
existed and has been the independent business centralized fac
subject of sale to some other undertakes to do a air- tor
conditioning
persons even if the order specific job or piece of system, s
wherein its
had not been given. work for other designs and m
specifications
persons, using his own are different
for ust
o Art 1467 (Civil Code) means and methods e be
– a contract for the without submitting v co
delivery at a certain himself to control as to e nsi
price of an article the petty details r de
which the vendor in y re
the ordinary course  Though EES imported such c d
of his business items, they were NOT for sale l an
manufactures or to the general public and were i d
procures for the used as mere components for e it
general market, n ca
whether the same is t n
on hand at the time . be
or not, is a contract V ar
of sale, but if the a gu
goods are to be r ed
manufactured i th
specially for the o at
customer and upon u no
his special order s 2
and not for the t pla
general market, it is e nts
BLOCKB2016

a contract for a c are


piece of work. h th
n e
o A contractor is a
i sa
person who, in
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 7
me; all are held liable to the payment i
engineered separately of 30% compensating tax f n
and distinctly. Each in accordance with Sec 190, o
project requires but without the 50% mark a t
careful planning and up provided in Section 183 n i
meticulous layout. (b) (I think 50% is removed y c
Such central air- because it’s for contract of e
conditioning systems sale!?!?). a
and their designs r t
would not have  Also, EES should be e h
existed were it not for subjected to 25% e
surcharge for delinquency k r
the special order of
in the payment of the e e
the party desiring to
said tax, as provided in p o
acquire it. This implies
Section 190: t f
that EES did not
intend to sell the said o Sec 190 – If any
aircon units to the o s
article withdraen
general public. Thus, r e
from the
EES is not liable for n
customhouse or
a t
the sales tax of 30%. the post office
 .EES should be held without payment
w t
liable to pay the taxes of the
r o
prescribed in Section compensating tax
i
190 of the Code. This is subsequently
t t
compensating tax is used by the
t h
not a tax on the importer for
e e
importation of goods other purposes,
n
but a tax on the use of corresponding
imported goods not entry should be SALES DIGESTS
subject to sales tax. made in the BLOCK 2B 2016
Hence, it should be books of accounts
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 8
Collector and payment of the the code provides for the p sur
corresponding exceptions as to the
compensating tax made period of limitation of ar cha
MI within 30 days from the assessment and collection of
date of entry or notice, and if taxes : tic rge
N
OR tax is not paid within such o Sec 332 – ul as
ISS period the amount of tax shall in case of ar fra
UE be increased by 25%.... a false and pr ud
S fraudulent ov pen
return isi alty
with o , it
intent to n can
evade of not
tax…, the th be
tax may e enf
be ta orc
assessed, x ed.
or a co
proceedin d  B
U
BLOCKB2016

g in court e
for the collection of d T,
such tax may be begun b
o
1. W/N EES is guilty of fraud (tax EES from paying the ec
evasion) es
50% surcharge au
n
Held: Yes, as proven by prescribed in Sec 183 se
ot
correspondences of EES with (a) because the th
i
foreign companies wherein EES surcharge Section 190 e
m
requested that words of of the tax Code fr
p
airconditioning equipment (where EES is au
os
should not be mentioned in subjected to as a d
e
shipping documents. contractor) does not is
a
provide it. According to
50
 The CTA absolved to CTA, where a o
%
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 9
glaring, it was held without Likewise and give
that EES could not assessmen , it was thep
be absolved from t at any agreed reference
the 50% fraud time that. to Mr.
surcharge. within 10 Incompe Parsons in
Otherwise, it would years after nsation case
give premium to an the for the anyone
intolerable act of discovery expense should
tax evasion. of the s of apply for
falsity, advertis the
2. W/N ement exclusive
fraud or
the tax omission. which, agency
for the for any
assessment has benefit island
of both notcompr
prescribed QUIROGA V PARSONS contracti ised with
FACTS: ng the
Held: no
parties, Visayan
On January 24, 1911,
 EES contends that Mr.Pars group;
herein plaintiff-appellant
the prescriptive ons may and that,
AndressQuiroga and J. Parsons,
period is 5 yrs. find Mr.
both merchants, enteredinto a
from importation. himself Parsons
But the SC held contract, for the exclusive sale of
obliged may sell,
that Sec 332 of "Quiroga" Beds in the Visayan
to make, or
Islands. It was agreed, among
Mr.Quir establish
others, that Andres Quiroga
oga branches
grants the exclusive right to sell
assumes of his
his beds in the Visayan Islands to
the agency
J.Parsons, subject to some
obligatio forthe
conditions provided in the
n to sale of
contract.
offer "Quiroga"
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 1
0
beds in all the towns of the
Archipelago where there are
no

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 1
1
BLOCK
SALES DIGESTS BLOCK 2B 2016 2016 B
exclusive for the same;
agents, and
shall and to order
immediately the beds by
report such
action to the dozen and
Mr. Quiroga
for his in no other
approval.
The manner
defendant
violated the
following He alleged
obligations: that the
not to sell defendant
the beds at washis agent
higher prices for the sale of
than those of his beds in
the invoices; Iloilo, and that
to have an
said
open
obligations are
establishmen
implied in a
t in Iloilo;
contract
itself to
of commercial
conduct the agency.
agency; to
keep the ISSUE:
beds on
public 1.
exhibition, Whe
and to pay ther
for the or
advertiseme not
nt expenses the
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 8
defendant, by reason of one made on the basis of a commission on breach acted thus
sales, as the plaintiff
the contract hereinbefore claims it was, for these contracts are would at his own
incompatible with each other.
transcribed, was an agent But, besides, examining the only free will.
of theplaintiff for the sale clauses of this contract, none of entitle
of his beds. them is found that substantially the Puyat v Arco
supports the plaintiff's plaintiff Facts:
HELD:
contention. Not a single one of to
Arc
these clauses necessarily conveys disregard
BLOCKB2016

No. o
the idea of an agency. the
Amusemen
In order to classify a These features exclude the orders
t Company
contract, due regard must be given legal conception of an agency or which
and
to its essential clauses. In the order to sellwhereby the the
Gonzalo
contract in question, there was the mandatory or agent received the defenda
Puyat &
obligation on the part of the plaintiff thing to sell it, and does not pay its nt might
Sons Inc,
to supply the beds, and, on the part price, but delivers tothe principal place
entered
of thedefendant, to pay their price. the price he obtains from the sale under
into an
of the thing to a third person, and other
That the contract by and agreement
if he does not succeedin selling it, condition
between the defendant and the that the
he returns it. By virtue of the s; but if
plaintiff is one of purchase and sale, latter
contract between the plaintiff and the
in order to show that it was not would
the defendant, the latter, plaintiff
order
onreceiving the beds, was consents
sound
necessarily obliged to pay their to fill
reproduing
price within the term fixed, them, he
equipment
without any otherconsideration waives
from Starr
and regardless as to whether he his right
Piano
had or had not sold the beds. In and
Company
respect to the defendant's cannot
(which was
obligation to order by the dozen, complain
based in
the only one expressly imposed by for
the US).
the contract, the effect of its having
Gonzalo
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 9
Puyat & Sons Inc is the The first and second order of the BLOCK B
exclusive agent of Starr Piano. said equipment all arrived in due time. a suit to the CFI
They were
charged the of Manila,
S 16 price of the seeking
A equipment,
10% reimbursement
commission
L and other from Puyat.
charges
(freight,
insurance, Trial Court ruled
E banking,
etc.). that the
Some time
S contract was
later, in a civil
D that of outright
case filed by
purchase and
I another
sale and
company
G against Puyat,
absolved Puyat.
The CA reversed
E Arco found
the decision by
out that Puyat
S holding that the
charged them
T relationship
with the list
between
S price and not
petitioner and
the net price
B of the
respondent was
that of agency.
L equipment
Issues:
and that Puyat
O
had received W/N
C discounts for there was the
K the order of contract was
said that of an
2
equipments. agency or an
B By reason of outright
2 said events, purchase and
Arco brought sale.
0
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 1
0
W/N there was fraud when that Puyat was the exclusive agent of Starr FACTS: bl
Piano and that it is out of
petitioner obtained the consent of the ordinary to be the agent of BOTH the vendor e
and purchaser
 P
the Arco on the price of the sound There was no fraud. It is to as
e
reproducing equipment. be observed that the twenty-five per a
t
cent (25%) discount granted by the co
Held: i
Starr Piano Company to the m
t
SC sustained the theory of the petitioner is available only to the m
i
trial court that the contract between latter as the former's exclusive er
BLOCKB2016

o
petitioner and respondent was that of agent in the Philippines. The ci
n
purchase and sale. The contract respondent could not have al
e
entered into was clear in their terms secured this discount from the Starr br
r
and admit no other interpretation. Piano Company and neither was the o
K
The agreement between them was petitioner willing to waive that ke
e
for Puyat to sell to Arco the sound discount in favor of the respondent. r
r
reproducing equipment. The 10% Respondent willingly paid the price u
&
commission does not necessarily quoted and it received the n
make the petitioner an agent of the equipment and machinery as de
C
respondent, as this provision is only represented. It is well known that r
o
an additional price which the local dealers acting as agents of Se
.
respondent bound itself to pay, and foreign manufacturers, aside from cti
w
which stipulation is not incompatible obtaining a discount from the home o
a
with the contract of purchase and office, sometimes add to the list n
s
sale. Also, SC noted price when they resell to local 19
h
purchasers. Not every concealment 4(
e
is fraud, in this issue SC said that, t)
l
business acumen permit of the of
d
loosening of the sleeves and of the th
sharpening of the intellect of men e
l N
and women in the business world.
i
ati
KER & CO. LTD. vs. Jose B. LINGAD. a on
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 1
1
al Internal Revenue and
was assessed to be
liable for P20,272.33 as
commercial broker’s
percentage tax.
o This liability
arose when
petitioner
(Ker & Co. as
“distributor”
) entered to
a contract
with United
States
Rubber
International
(referred to
as
“Company”).
o The stipulations of their
contract states that:

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 1
2
SALES DIGESTS BLOCK 2B 2016
BLOCK B
2016
That the Company will from time to importers, manufacturers, producers or bona
time consign the specified products to fide employees, who, for compensation or
the
Distributor as the Company would judge to commercial broker as, “…all persons, other than
be necessary.
 All goods consigned will remain the
property of the Company until sold by the
Distributor and all sales made by the
Distributor shall be made in his name.
 However, it was also stipulated that the
contract does not constitute the Distributor
the agent or legal representative of the
Company for any purpose whatsoever.
 The Commissioner of Internal Revenue therefore
assessed Ker & Co. to be a commercial broker under
such agreement and that the Court of Tax Appeals
upheld such finding. Hence, the petition to the Supreme
Court

ISSUE(s):

1. W/N the relationship between Ker & Co. LTD. and United
States Rubber International is one of vendor and vendee
or broker and principal.
BLOCKB2016

HELD/RATIO:

 The Supreme Court affirmed the decision of the


Court of Tax Appeals finding that Ker & Co. LTD. is a
commercial broker of United States Rubber
International.
o The National Internal Revenue Code defines a

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 10
profit, sell or bring about sales or purchasers
of merchandise for other persons or bring
proposed buyers and sellers together.”
o The Court reiterated the controlling test to
be followed as to who falls under the
definition of a commercial broker in
Commissioner of Internal Revenue v.
Constantino which states that:
 “Since the company retained ownership
of the goods, even as it delivered
possession unto the dealer for resale to
customers, the price and terms of
which were subject to the company’s
control, the relationship between the
company and the dealer was of
agency.”
o Salisbury v. Brooks supports such view:
o The transaction is a sale if such
transfer puts the transferee in the
position of an owner and makes
him liable to the transferor as a
debtor for the agreed price.
o The transaction is one of agency to
sell if the ownership of the property
delivered to the agent remained
with principal and has the right to
fix the price, control sales and

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 11
SALES DIGESTS BLOCK 2B 2016 BLOCK B
2016
receive the both parties
proceed less the consented to a
agent’s
made. upondacion en pago
commission
sales
to satisfy the
debt. A deed of
Lo v. KJS
assignment
[G.R. No.
was executed
149420.
October 8, in favor of KJS,
2003] assigning Lo’s
credit from
Facts: Jomero Realty
Corp. (JRC), a
Lo
company who
bought from
owes him
KJS
money.
scaffolding
equipment The
worth P540k. deed
He paid a contained,
downpaymen among others,
t of P150k, a warranty that
the balance to Lo (assignor)
be payable in “shall and will
ten monthly at times
installments. hereafter, at
the request of
Upon said ASSIGNEE,
default on execute and do
the all such further
installments, acts and deeds
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 11
as shall be reasonably necessary to W/N THE EXECUTED DEED OF ASSIGNMENT, A different applies:
effectually enable said ASSIGNEE to FORM
PAGO, OF DACION EN LO’S OBLIGATION TO
EXTINGUISHED from that
KJS – No. The
recover whatever collectibles said Held: due. vendor in
ASSIGNOR has in accordance with good faith
1.) No. The deed of assignment 2.)
the true intent and meaning of shall be
BLOCKB2016

served to be a dacion en pago, a However,


these presents.” responsible
special mode of payment where although for the
However, when KJS tried to the debtor offers another thing to there is a existence and
collect from JRC, the latter refused on the creditor who accepts it as dacion en legality of the
equivalent of payment of an credit at the
the ground that Lo was also indebted pago
time of the
to him (JRC). So, KJS demanded outstanding debt. In order that which sale , unless it
payment from Lo who however there be a valid dation in payment, may should ha ve
contends that his obligation has been the following are the requisites: extinguish been sold as
extinguished when they executed the an doubtful; but
(1) There must be the not for the sol
deed of assignment. obligation,
performance of the prestation in vency of the
such debtor, unless
Issue: lieu of payment (animo solvendi)
dacion is, i t has been so
which may consist in the delivery
by express expressly
of a corporeal thing or a real right stipulated or
provision
or a credit against the third unless the
of law
person; insol vency
(Art. was prior to
(2) There must be some 1245), the sale and of
difference between the prestation governed common
knowledge.
due and that which is given in by the Law
substitution (aliud pro alio); on Sales.
Being
(3) There must be an governed
agreement between the creditor and by the
debtor that the obligation is Law on
immediately extinguished by reason Sales, Art.
of the performance of a prestation 1628
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 12
SALES DIGESTS BLOCK 2B 2016
BLOCK B
2016
Accordingly, Lo, being the vendor of his credit, is bound -since then, they had been in continuous possession and had
by law and the stipulation on the deed to warrant the existence introduced permanent provisions
and legality of the credit at the time of the sale or assignment.
This he failed to do because, as it appears, compensation had -that petitioners entered the properties illegally and refused to
already taken place between him and JRC. In other words, at the leave when asked to do so
time he assigned his credit to KJS, the credit was already non- PETITIONER's VERSION
existent because of compensation had already taken place by
operation of law. -alleged deed of absolute sale is void for being spurious and for
lacking consideration

Chapter 2: Parties to a Contract of Sale -Paulina did not sell her properties to anyone

DOMINGO v CA -as Paulina's nearest surviving kin within the 5th degree of
(sorry for the long digest and dahil hindi paragraph form! heavy consanguinity, they inherited the three lots upon her death in 1966
to sa facts dahil 2 different versions kaya hiniwalay ko na parang
-they had been in possession of the properties for more than 10
bullet form para mas malinaw. magulo din pagkasulat sa case eh) years
Facts: - the alleged consideration for the parcels of land which was for
Paulina Rigonan owned 3 parcels of land in Ilocos. She the price of P850 only indicates a fictitious sale
allegedly sold them to spouses Felipe and Concepcion Rigonan TESTIMONY FOR RESPONDENTS
(private respondents) who claim to be her relatives. Respondents
filed a complaint for revindication against Petitioners Eugenio 1. Juan Franco testified that he was a witness to the questionned
Domingo and 2 others, who claim to be Paulina's closest surviving deed. However when cross-examined and shown the deed, he
BLOCKB2016

relatives, who allegedly took possession of the properties and stated that the deed was not the document he signed as a
refused to vacate the same. witness

RESPONDENT's VERSION 2. Atty Tagatag (Notary) testified that he personally prepared the
deed, that he saw Paulina affix her thumbprint, and that he
-they are the owners of the three parcels of land through a deed of
signed as both witness and notary. He also testified to notarizing
sale executed by Paulina in 1965
Paulina's last will and testament in 1965. The will mentioned the
same lots sold to respondents and he could not explain why.
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 12
BLOCK
SALES DIGESTS BLOCK 2B 2016 2016 B
3. Felipe not receive any
Rigonan
claimed to notice nor
be Paulina's offer to sell the
close
relative, lots. This is
that their contrary to the
fathers were
first cousins.
But he could deed of sale
not remember
the name of
which
Paulina's
mentioned that
grandfather.
all adjacent
His claim was
owners were
disputed by
notified of the
defendants
sale. He doesnt
who lived
have any
withh Paulina
knowledge of
as their close
any sale
kin.
TESTIMONY 2. Ruben
FOR Blanco,
PETITIONERS Refistrar of
Deeds, testified
1. Jose Flores,
that only a
owner of the
carbon copy of
adjacent lot
the deed was
and who
filed in his
lived there
office
with Paulina
since he could 3. Zosima
remember Domingo, wife
and til her ofEugenio,
death, said testified that
thathe did her husband
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 13
was Paulina's nephew ( Eugenio's ALSO a paid witness to the case. Also, the copies also
Zosima Domingo, Paulina's
father and Paulina were first housekeeper, testified that he did not alleged bore
seeTagatag and the other
cousins) and that they lived with parties in Paulina's house on the deed of different
Paulina since 1956. They took care alleged date of the deed's sale. The dates of
of her daily needs even whenl she execution. carbon entry and
was hospitalized and until she died. 2. CA reversed and ordered herein copy had the deed
petitioners to vacate the property. intercalati was
RULINGS OF LOWER COURTS ons and registered
Issue
BLOCKB2016

1. RTC favored herein petitioners and discrepanc long after


declared them the lawful owners and ies its date of
W/N the existence and due
possessors by virtue of intestate allegedly execution
execution of the deed of sale
succession. The deed was found to due to and after
was established. --NO.
be "fake", being a carbon copy with blanks left Paulina's
no original presented, and that the unfilled by death.
document's execution was tainted Tagatag Paulina, the
Ruling during its alleged
with alterations, defects, tamperings,
and irregularities which render it void registratio vendor,
1. Respondents only presented a
ab initio. Testimonies for respondents carbon copy of the deed. Although n. The was not
were also rebutted as Franco alleged given a
CA calls it a "duplicate original", it
retracted his testimony, Tagatag's contained filled in blanks and other copy.
testimony was not credible as he is alterations.It also did not bear SALES DIGESTS
a witness and notary to both the deed Paulina's signature but only her
BLOCK 2B 2016
and will AND alleged thumbprint. Franco, also Also, Paulina was never immediate
testified that said deed was not asked to vacate the
premises she possession and
the one he signed as witness. The purportedly sold, allegedly
because Felipe agreed to let occupation of
only testimony available for them Paulina to
stay in the the property
is Atty Tagatag's, which is
house until her was deemed
uncorroborated and self-serving
death. In one corroborative
2. Irregularities abound regarding case, The of truthfulness
the execution and registration of buyer's and
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 14
authenticity of the deed of sale. The However, when such age or infirmities execution of thhe determinati
deed, Paulina was
alleged vendor's continued have impaired the mental faculties so as already incapacitated on by the
possession in this case throws an to prevent the person from properly, physically trial court
and mentally (she
was 80 y/o.Zosima
inverse implication, a serious doubt intelligently, and firmly protecting her narrated that at that lacks
time,
on the due execution of the deed of property rights, then she is undeniably Paulina credibility
sale. incapacitated.At the time of the plays for itwas
It is also noteworthy that execution of the alleged contract, with her made by
the same parcels of land involved Paulina was already of advanced age waste trial judge
here were still included in he will and senile. Zosima he housekeeper and who
subsequently executed by Paulina. testified that at the time of the alleged urinates presided
in bed). only in one
These hearing of
3. The price of P850 allegedly paid by raise the case
respondents for 9 parcels of land, doubt
that she COURT
including 3 parcels in dispute, a
consente RULED: A
house, and a warehouse, raises
d to the judge may
further questions. Consideration is
sale of validly
the why of the contract, the
and the render a
essential reason which moves the
price of decision
contracting parties to enter into the
the although
contract. Since Paulina is well-off, we
properties he has only
see no compelling reason for her to
. There is partly heard
sell the subject properties at a
also no the
meager price of P850. (Fictitious and
receipt. tertimony
grossly and shockingly inadequate
of the
consideration -- sale is void ab initio) IF EVER ASKED:
Procedural Issues witnesses
BLOCKB2016

4. The general rule is that a person is raised by since he


not incompetent to contract merely Respondents could rely
because of advanced years or by on the
1. Factual records of
reason of physical infirmities.
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 15
the case

2. The Petition lacks a certification against


forum shopping

COURT RULED: Petitiones


averred that they attached one
in the copy intended for this
Court. This is substantial
compliance

3. Petition must be
deniedbecause it does not
present anybsubstantial legal
issue, but factual or evidentiary
ones which were already firmly
resolved by the CA

COURT RULED: This petition is


properly given due course
though mainly factual because
of the contradictory findings of
the trial court and the CA. The
latter court apparenlty
overlooked certain relevant
factswhich justify a different
conclusion.

PARAGAS v. HEIRS of BALACANO


G.R. No. 168220 August 31, 2005

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 16
SALES DIGESTS BLOCK 2B 2016 BLOCK B
2016
Facts: Gregorio Balacano reason of physical
was the registered
land owner of Lots infirmities.
when such
infirmities
impaired age or
have
faculties
prevent sothe
the asmental
to
person from
properly, intelligently,
and firmly protecting
1175-E and her
1175-F
Santiago
Isabela.
was in
City,
He
hospitalized
for Gregorio
suffering purportedly
from liver sold Lot 1175-F
cirrhosis on and a portion of
June 28, 1996 1175-E to
at the spouses Rudy
Veterans and Corazon
Hospital in Paragas for
Nueva P500,000. On
Viscaya, and October 17,
was later on 1996, the
transferred to spouses sold a
Veterans portion of Lot
Memorial 1175-E to
Hospital in Catalino, one
Quezon City. of the children
He died on of Gregorio.
July 28, 1996.
On
On October 22,
July 22, 1996, 1996, the
or barely a grandchildren of
week before Gregorio then
his death,
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 15
property rights, then she is undeniably
incapacitated.
filed a complaint for annulment of improvem land.
sale and partition. They allege that In the case at bar, the deed ents to However,
their grandfather could not have sold of sale was allegedly signed by Corazon lower court
the subject lots because at the time Gregorio on his death bed in the was null later
of the execution of the deed of sale, hospital. Gregorio was an and void modified
their grandfather was seriously ill and octogenarian and was suffering an because the
dying at that time, which vitiated his illness at that time – circumstances they are judgment
consent to the disposition of the which raise grave doubts on his conjugal by
property. physical and mental capacity to properties declaring
freely consent to the contract. and she that
Issue: had not Corazon is
1. W/N the sale of the lots are given her the lawful
valid consent to owner of
BLOCKB2016

CALIMLIM-CANULLAS v. FORTUN the sale. the land


Held: FACTS but the sale
T of the
No. In Domingo v. Court of Mercedes and Fernando he trial
were married in 1962 and had 5 conjugal
Appeals, the Court declared as null court at
children. They lived in a small house house was
and void the deed of sale therein first ruled
on the residential land in question. null and
inasmuch as the seller, at the time of in favor
Fernando inherited such land after void.
the execution of the alleged contract, of
was already of advanced age and the death of his father in 1965. In Corazon
senile. The general rule is that a 1978, Fernando left his family to live as the
person is not incompetent to contract w/ his concubine Corazon. He then lawful
merely because of advanced years or sold said lot w/ the house in favor of owner of
by Corazon for P2,000.00. Corazon, the land
unable to take possession of the as well as
house and lot, filed a complaint for ½ of the
quieting of title. Mercedes objected house
alleging that the the sale of the land erected
together with the house and on the
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 16
ISSUES
SALES DIGESTS BLOCK 2B 2016 BLOCK B
2016
MATABUENA v CERVANTES (1) W e
Facts: / p
ro
N p
e
t rt
yo
h ft
e h
c e
h
u
o sb
n a
st n
d
r ip
u so
c fa
ti ct
o o
n ga
ve
o
f th
e
a la
c n
o d
th
nj e
u ch
g a
ra
al ct
h e
o ro
f
u c
s
e o
o n
n j
t u
h g
e
e a
x l
cl p
u r
si
v o
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 16
On
Februa
pert undi at the expense of properties to each ry 20, a
1956
Felix
y; ng the partnership other; the same Matab
uena r
and execut
ed a
the during the prohibitions apply to deed
of r
(2) tran marriage on land a couple living as donati i
/N sacti belonging to one of husband and wife on e
the inter
on. the spouses also w/o the benefit of vivos d
sale pertain to the marriage. To rule in
of partnership, but otherwise would be favor o
of
the the value of the to put the persons in n
HEL Petron
lot land shall be guilt at a better ila
D
toge Cervan
reimbursed to the position than those M
tes, his
ther (1) Y spouse who owns legally married. This comm a
with ES. the same. is dictated by the on- r
the Acc Therefore, public interest. l c
hous ordi Fernando could not a h
e ng have alienated the w
and to house and lot to 2
impr Artic Corazon since s 8
ove le Mercedes had not p ,
men 158 given her consent o
ts of to said sale. u 1
there the s 9
on Civil (2) NO. The sale e 6
was Cod was null and void . 2
BLOCKB2016

valid e, for being contrary


.
unde buil to morals and T
r ding public policy. The h U
circu s law generally e n
msta cons prohibits spouses y f
nces truc from selling or
o
surro ted donating m r
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 17
t i ns: “Having inheritance o
u x made no legal taxes as well. Held: f
n will”). On November The
a d Cornelia 23, 1965, the supre t
t i Matabuena, lower court me h
court
e e Felix’ only upheld the e
revers
l d sister and validity of the ed the
y nearest donation saying decisio C
, i relative to that it was n of i
n him, done while the the v
o t questioned spouses lower i
n e the validity of weren’t court. l
s the donation. married yet,
S t She claimed hence the W C
e a that the ban prohibition on h o
p t on donations art. 133 does i d
t e between not apply. l e
. spouses Cornelia then e
( should also appealed to the c
1 u apply to supreme court A o
3 m common-law r n
. marriages. Issue: t s
1 . She had the i i
9 . land declared W/N the ban on c d
6 in her name a donation l e
2 i by virtue of between the e r
, t an affidavit on spouses during s
self- a marriage 1
F m adjudication, applies to 3 a
e e paying the common-law 3 s
l a estate and relationship
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 18
v u nsideration
o s of the most
i e exigent
d s character as
well as the
a d dictates of
u morality
d r requires that
o i the same
n n prohibition
a g should apply
t to a
i m common-law
o a relationship,
n r as it is
r contrary to
b i public policy
e a (JBL Reyes,
t g Buenaventur
w e a v. Bautista
e , 1954). The
e law prohibits
n p donations to
o the
t l
h i
e c
y
s
p c
o o
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 19
BLOCK
SALES DIGESTS BLOCK 2B 2016 2016 B
other consort Whatever
because of
fear of undue omission may
pressure and be apparent in
influence
upon an
the donor. So
long as interpretation
marriage
remains the
cornerstone purely literal of
of family
law, the language
reason used must be
and remedied by an
moralit adherence to
y alike its avowed
deman objective)
d that
the However, the
disabili lack of validity
ties of the
attache donation by
d to the deceased
marria to appellee
ge does not
should necessarily
likewis result in
e appellant
attach having
to exclusive
concub right to the
inage. disputed
property. As a
(Spirit of the widow,
Law: StatCon: Cervantes is
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 17
entitled to one-half of the declare as null and void the three sales that occurred le
stating that the first
inheritance, and the plaintiff, the two (between Roldan of
surviving sister to the other half. and the
Dr. Ramos and vice
versa) was against
Article 1459 of the 17
Civil Code
PHILIPPINE TRUST CO. V ROLDAN and par
Facts: cels
that
the of
Mariano Bernardo
third lan
inherited 17 parcels of land from
sale d
his deceased father. Since Mariano
was was
was a minor, guardianship
also null
proceedings were instituted and
BLOCKB2016

and
her step-mother, Socorro Roldan ineffec
voi
was appointed as his guardian. tual
d
Roldan filed in said guardianship becaus
for
proceedings a motion asking for e
viol
authority to sell as guardian the 17 Roldan
atio
parcels for the sum of P14,700 to had
n of
Dr. Fidel C. Ramos, her brother-in- acquir
Arti
law, the purpose of the sale being ed no
cle
allegedly to invest the money in a valid
145
residential house in Tindalo Street title to
9 of
Manila, which the minor desired to convey the
have. The motion was granted and to Civi
she sold the land with judicial Cruz. l
confirmation of the sale. After a Issue: Cod
week, Dr. Ramos sold to her the e
same lands for P15,000. Later on, 1. w
whi
/n
Roldan sold 4 parcels out of the 17 ch
th
to Emilio Cruz. Philippine Trust pro
e
Company subsequently replaced hibi
sa
Roldan as guardian and sought to
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 18
ts a guardian from interest and in line with the court’s BLOCK B
purchasing either in suspicion whenever the guardian selling them benefit. The
to Dr. Ramos.
person or through the acquires the ward’s property, the The sale trial court
mediation of another the Court has no hesitation to declare between upheld the
Roldan and
property of her ward. that in this case, in the eyes of the Cruz is contracts but
likewise void
law, Socorro Roldan took by because allowing the
Held: Roldan never
purchase her ward’s parcels thru acquired title
to the parcels minor to
of
The Supreme Court her brother-in-law, and that Article land. repurchase all
annulled the 3 contracts of sale in 1459 ofthe Civil Code applies. More the parcels by
question; declared the minor as Information: paying P15, 000,
Even if no collusion is
the owner of the 17 parcels of within 1 year.
proved or that the guardian may The
land along with its fruits, with the The CA affirmed
have acted without malice, the fact Philippine
obligation to return to Roldan the judgment.
remains that she acquired the Trust
the price of P14,700 with legal Hence, the
properties of her protégé through Company filed
interest. appeal to the
her brother-in-law.. Due to the very the case SC which
Guardianship is a trust of short time between the two sales (a against reversed the
the highest order, and the trustee week), it may be deduced that she Roldan before decision.
cannot be allowed to have any planned to acquire the properties the CFI Manila
inducement to neglect his ward’s for herself at the time of which held The
that there was defense sought
S ESTS BLOCK 2B by Roldan
no proof that
A 2016 Dr. Ramos through
was a mere Rodriguez v.
L
intermediary Mactal does not
E or that the apply because
S latter had an in that case the
agreement guardian sold
D the property of
with Socorro
I to buy the her ward in
parcels for her 1926 and
G
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 19
repurchased it two years after which Macariola v Asuncion project subdivided
Who were the petitioners/respondents?
is enough to dispel the natural Macariola: A civil case for partition of after the
suspicion of the guardian’s motives or of property was decided after her partition Project of
actions. In the present case, only 1 father died. She was unhappy with among Partition.
week had elapsed between the first her share. Apparently it was the the It was
two sales. smallest and least valuable. So propertie divided
naturally she sued to annul. s as into 5 lots,
Minor on losing end in the between Lot 1184-A
transaction. The calculation, that the Judge Asuncion: The Judge who the through E.
BLOCKB2016

investment in the Tindalo Street decided Civil Case 3010. He later Macariola
house produces to the minor the purchased a lot which was part of Lot 1184-E
s and the
rentals of P2,400 yearly while the that involved in the partition of (2,172
Reyeses,
parcels of land yield for the that case. sqm) was
duly
stepmother an average of P1,522 thereafter
approved
yearly, does not include the price of Facts: reconveye
by both.
the lot on which the house was Both the petitioner and the d (sold) to
The
erected. Estimating such lot at respondents in the antecedent Dr. Arcadio
problem
P14,700 only, the result is that the civil case are the children of a Galapon
emerged
price paid for the 17 parcels gave the certain recently deceased and wife,
when
minor an income of only P1,200 a Francisco Reyes. The two in 1964.
one of
year, whereas the harvest from the contending parties in this case On 1965,
the
seventeen parcels netted his step- were Macariola, child of Reyes by Galapon
propertie
mother a yearly profit of P1,522.00. his first wife, and the remaining thereafter
s solely
The minor was on the losing end. Reyeses, Francisco’s children with sold a
owned
his second wife. The case portion of
by
stemmed from a dispute this lot to
Francisco
regarding how to divide the Judge
Reyes,
estate of the late Francisco among Asuncion
Lot
his various heirs, and for this (he was
Number
purpose a civil case had been filed the judge
1184,
previously which resulted in a that
was
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 20
handled the previous Civil Case
regarding partition) and wife.
The year after (1966), The
spouses Galapon and Asuncion
sold their

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 21
SALES DIGESTS BLOCK 2B 2016
BLOCK B
2016
collective shares and interests in Lot 1184-E to Traders through the mediation of another:
Manufacturing and Fishing Industries, Inc. of which the spouses
Asuncion were shareholders. "(5) Justices, judges, prosecuting attorneys, clerks of superior and
inferior courts, and other officers and employees connected with
On 1968, Macariola, filed a complaint to annul the partition of the the administration of justice, the property and rights in litigation or
property. It was only then that Macariola discovered that a lot levied upon an execution before the court within whose jurisdiction
was already owned by the Judge. Learning of what transpired, or territory they exercise their respective functions; this prohibition
Macariola filed a complaint against Judge Asuncion with four includes the act of acquiring by assignment and shall apply to
causes of action: lawyers, with respect to the property and rights which may be the
object of any litigation in which they may take part by virtue of their
1) Violation of Article 1491 of the Civil Code by
profession".
purchasing a lot which was the subject of decision by
him in a judicial proceeding.

2) Violation of Anti-Graft and Corrupt Practices Act by Ruling:


associating with Traders Manufacturing and being a
stockholder therein while at the same time a presiding The prohibition regarding the purchase of the subject property
judge. under article 1491 only applies to property under litigation. By
‘under litigation’, we mean literally that there is still a case
3) That he willingly associated with an impostor pending. By the time Judge Asuncion had acquired the property,
lawyer who was a stockholder at Traders. there has been a long time had already transpired, there was no
appeal filed or perfected in due course, In short, it was already
4) That he lacked judicial ethics.
final and executor. Note that his decision was made in 1963,
Issue Important to Sales: while he purchased the land in 1965. Hence, it was no longer
BLOCKB2016

subject of litigation. The subsequent case filed to annul the


I) Whether or not Judge Asuncion Violated Article 1491 partition on 1968 did not change the character of the property
of the Civil Code: No and the fact that, by then, it was already owned by Asuncion.
Hence, there was no violation. Further, the property was
Article 1491 states that:
purchased not from the parties in litigation, but from an innocent
Article 1491. The following persons cannot acquire by purchase, third party afterwards (Galapon).
even at a public or judicial action, either in person or
<However>, the Court did say it was improper (not illegal) for the
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 19
judge to purchase a property previously subject to his judicial

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 20
BLOCK
SALES DIGESTS BLOCK 2B 2016 2016 B
decision, abstain from
because
judges should making
avoid the personal
appearance of
impropriety. investments
Nevertheless,
as to the
charges of in
possessing
prohibited enterprises
interest, the which are
Court took apt to be
notice of the involved in
fact that a litigation in
few days after his court;
the and, after
incorporation his accession
of Traders, to the
the Asuncions bench, he
sold their should not
share, implies retain such
that they investments
were aware of previously
the made, longer
appearance of than a
impropriety. period
This is sufficient to
according to enable him
Canon 25, to dispose of
Canons of them
Judicial Ethics. without
"A judge serious loss.
should It is
desirable
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 20
that he should, so far as municipality of Barotac Viejo province of However,
Iloilo, which he
reasonably possible, refrain from caused to be the CA
all relations which would normally surveyed on, affirmed
whereby he was
issued a plan Psu-
tend to arouse the suspicion that 99791. During the the CFI’s
war, the
such relations warp or bias his record of decision
judgment, or prevent his impartial the case dismissing
attitude of mind in the was lost Militante’s
administration of his judicial before it application
duties.......................................................................................... was for
heard, so registration.
Judge Asunción was Aquitted
Militante ISSUES:
Also, he got promoted to Court of petitioned
Appeals Justice in the end. to
reconstitu 1. WON
DOMINGO D.RUBIAS vs. ISAIAS te the the
BATILLER case. The con
FACTS: CFI of trac
BLOCKB2016

Iloilo t of
On August 31, 1964, plaintiff
dismissed sale
Domingo D. Rubias filed a suit to
his bet
recover the ownership and
applicatio we
possession of certain portions of lot
n. en
under Psu-99791 located in Barrio
Militante app
General Luna, Barotac Viejo, Iloilo
appealed ella
which he bought from his father-in-
to the CA. nt
law, Francisco Militante in 1956
Pending and
against its present occupant
appeal, his
defendant, Isaias Batiller,
Militante fath
Before the war, Militante sold the er-
claimed ownership of a parcel of land land to in-
located in the Barrio of General Luna, plaintiff. law
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 21
, the late Francisco complaint. No right or title BLOCK B
Militante over the was passed on/sold by ART. 1491. whose
The following
property subject of Plan Militante to plaintiff persons jurisdiction or
Psu-99791 was void because Militante’s cannot territory they
acquire any
because it was made application for registration purchase, exercise their
even at a
when plaintiff was was dismissed. Also, even public auction, respective
either in
counsel of his father-in- assuming that Militante person of
through the functions; this
mediation
law in a land registration had the right to sell to of another: prohibition
case involving the plaintiff, their deed of xxx includes the
property in dispute sale/contract is null and (5) Justices, act of acquiring
(relevant to Sales) void according to the Civil judges, an assignment
Code: prosecuting and shall apply
HELD:
attorneys, to lawyers,
Art. 1409. The following contracts
1. Yes. Plaintiff lacks cause clerks of with respect to
are inexistent and void from the
of action that calls for superior and the property
beginning: xxx
the dismissal of the inferior and rights
(7) Those expressly prohibited by law. courts, and which may be
the object of
S TS BLOCK 2Bother
2016officers
and any litigation
A employees in which they
L connected may take part
with the by virtue of
E administratio their
S n of justice, profession.
the property
D DAROY V
and rights of
I in litigation or
ABECIA
Nature:
G levied upon
Complaint for
an execution
E before the
malpractice
S court within filed by
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 22
Regalado Daroy (now deceased) turn conveyed the land to Nena Abecia, wife 2. D e
of respondent Abecia,
against Atty. Esteban Abecia, a for the sum of P1,350.00. Two weeks thereafter, ar exe
under date of April
member of the Bar. 17, 1971, the said Jose Gangay oy cuti
executed a Deed of Sale of the ha on
Facts: d of
same property in favor of Mrs.
Abecia was the counsel for Nena Abecia, the wife of the kn the
Daroy in a forcible entry case. He respondent, by virtue of which TCT o dee
hired Abecia as his lawyer and won. No. T-15926 was issued in the wl d of
name of Nena Abecia, married to ed sale
BLOCKB2016

To satisfy the award for damages, a


parcel of land of the defendant was Atty. Esteban Abecia, the ge as
sold to Daroy at an execution sale. . respondent. of sho
Upon failure of the defendants to Sometime in the year th wn
redeem the land, its ownership was 1984, the complainant discovered e in
consolidated in complainant Daroy. that his said property was already sa the
The land was then sold to Daroy’s in the name of Mrs. Nena Abecia le. She
relative, who then sold it to and Atty. Esteban Abecia. C riff’
Abecia’s wife. Complainant Daroy o s
He now claims that these m Ret
claimed that respondent Abecia
sales are void because Abecia pl urn
forged his signature in a deed of
forged his signature on the deeds of ai of
absolute sale, dated March 31,
sale. IBP disbarred Abecia. na Ser
1971, transferring the subject
parcel of land to Jose Gangay nt vic
Issue:
purportedly for the sum of ve e.
P1,250.00 and that in a fictitious 1. Did the IBP erred in dismissing Abecia? ry The
deed of absolute sale, dated April w evi
2. Is the sale of the property void? ell den
17, 1971, it was made to appear
that Gangay in kn ce
Held:
e sho
1. The IBP erred in dismissing Abecia. (see w ws
reason in no. 2) of tha
th t
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 23
Daroy was a party to the
sale at the time it was
made and did not
“discover” it 9 years
later as he claimed. He
was not defrauded. The
parties thought that
because the land had
been acquired at a
public sale to satisfy a
judgment in a case in
which respondent was
complainant’s counsel,
the latter could not
acquire the land. The
parties made this

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 24
BLOCK B
2016
SALES DIGESTS BLOCK 2B 2016
arrangement to circumvent Art. 1491 of the Civil Code
which prevents lawyers from acquiring property and
rights
that may be the object of any litigation in which they may Chapter 3: Subject Matter of a Contract of Sale
take by virtue of their profession.
SIBAL Vs VALDEZ
ART. 1491. The following persons cannot acquire by purchase, even
Facts:
at a public or judicial auction, either in person or through the
mediation of another: On 1923, Macondray & Co., Inc. bought 8 parcels of land at
the auction held by the sheriff of the Province of Tarlac. On the
....
same year, Leon Sibal, the judgment debtor, paid Macondray
(5) Justices, judges, prosecuting attorneys, clerks of superior and 2000php as the redemption price of said parcels of land, without
inferior courts, and other officers and employees connected with specifying the particular parcels to which it was to apply.
the administration of justice, the property and rights in litigation or
On 1924, Emilio J. Valdez bought parcels of land, where the
levied upon an execution before the court within whose jurisdiction
sugar cane in question is planted, at the auction held by the sheriff
or territory they exercise their respective functions; this prohibition
of Province of Tarlac. He bought all of Macondray's rights and
includes the act of acquiring by assignment and shall apply to
interest in the eight parcels of land it acquired. He also paid
lawyers, with respect to the property and rights which may be the
Macondray another 2000php for the redemption price Sibal paid.
object of any litigation in which they may take part by virtue of their
profession. Sibal alleged two causes of action (1) that Valdez has
refused to accept Sibal's offer to redeem the sugar cane the latter
The prohibition in Art. 1491 does not apply to the sale of a
planted and (2) that Valdez has harvested and attempted to further
parcel of land acquired by a client to satisfy a judgment in his favor,
harvest palay that belongs to Sibal. So Sibal prayed for a writ of
BLOCKB2016

to his attorney was not the subject of the litigation.


injuction against Valdez to prevent the latter from possessing the
While judges, prosecuting attorneys, and others connected subject property and from further possessing or harvesting the
with the administration of justice are prohibited from acquiring sugar cane and palay in said parcels of land. He also prayed to order
“property or rights in litigation or levied upon in execution” the Valdez to consent with the redemption of the sugar cane. However,
prohibition with respect to attorneys in the case extends only to Valdez argued that the sugar cane is his personal property and
“property and rights that may be the object of any litigation in cannot be subject to redemption.
which they may take part by virtue of their profession.”
Issue:

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 22
BLOCK
SALES DIGESTS BLOCK 2B 2016 2016 B
WON the sugar cane in question is a personal property? crop." [point is crops can be immovable first but then they mature
WON the sugar cane in question is subject to sale? and become movable. Yan pagkagets ko]
Held: SC decided that since the Sibal, in good faith, planted the palay in
said parcels he is entitled to half of it.
Yes, sugar cane is classified under personal property so it
cannot be subject of redemption. Art. 334 of the Civil Code
provides that trees, plants, and ungathered products, while they
are annexed to the land are real property. However, it has been PICHEL V. ALONZO
modified by the Code of Civil Procedure and by Act No. 1508, in Facts:
the sense that, for the purpose of attachment and execution, and
Prudencio Alonzo was awarded a parcel of land by the
for the purposes of the Chattel Mortgage Law, "ungathered
PHHC. He leased it to Sua. The board of liquidators cancelled the
products" have the nature of personal property.
award to Alonzo on Jan 27, 1965 because the land was leased to
Yes, a man may sell something which he potentially but someone, which is not allowed by RA 477. It was later reinstated
not actually possesses. It is valid to sell a thing, which though not in 1972. Alonzo executed a deed of sale for the coconut fruits
yet actually in existence, is reasonably certain to come into (from Sept 15, 1968 to Jan 1, 1976) of the parcel of land awarded
existence as the natural increment or usual incident of something to him by PHHC by reason of RA 477. He executed this in favor of
already in existence, provided that the thing can be specified and Luis Pichel in exchange for payment amounting to 4,200.00.
identified. The thing sold must also belong to the vendor to begin
According to RA 477, the grantee is prohibited to sell, lease
with. The buyer's title to the thing will vest upon its existence.
or encumber the land and the improvements therein within 10
Moreover, crops, whether growing or standing in the field ready
years from the issuance of the title, if he does, the transfer shall be
to be harvested, when produced by annual cultivation, are not
BLOCKB2016

considered null and void. The trial court held that the deed of sale
part of the realty. They can be sold.
was a contract of lease of the land itself and that it is null and void
Note: by virtue of RA 477. It ordered Alonzo to pay back the 4,200 that
The immovability of growing crops are "only in abstracto and Pichel paid.
without reference to rights on or to the crop acquired by others
than the owners of the property to which the crop is attached" but Issue:
jurisprudence recognizes the possible mobilization of the growing

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 23
BLOCK
SALES DIGESTS BLOCK 2B 2016 2016 B
1. WON the state. There
Alonzo has
the right to should be an
execute appropriate
such deed
of sale proceeding for
considering
that the reversion.
award was, at
the time,
cancelled by
the Board 2. No.
of Liquidators
2. WON the a. The terms
Deed of sale is of the contract
the are controlling
prohibited when there is
encumbrance no ambiguity.
contemplate No need to
d in RA 477 resort to
statutory
Held:
construction.
1. Yes.
b. It is for the
Cancellation of
SALE of the
the award
FRUITS of the
granted
land and not
pursuant to RA
lease of the
477 does not
BLOCKB2016

land. The
automatically
subject matter
divest the
of the sale is
awardee of his
the fruits of
rights to the
the land.
land. No
Possession and
immediate
use of Fruits is
reversion to
different from
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 24
possession and use of land. d. A lease is where one party binds himself to give precedenc Manansala
to another the
Different rights. The first one is of enjoyment or use of a thing for a price certain e not only to enforce
for a period which
the accessories, the second of the may be definite or indefinite and a in actual a deed of
principal. Right over the accessories sale is one where there is transfer possessio sale
does not vest right over principal. of ownership upon delivery. n but also covering
The accessory merely follows the e. The purpose of the law is in the the same
principal and not vice versa. fulfilled, not violated when the applicatio lot entered
fruits are sold. n for its into by her
c. A valid sale may be made of a and
purchase.
thing, which, though not yet in The grantee can be self sufficient Manansala
In 1984,
existence, is reasonably certain to and not fully reliant on the in 1960.
Manansal
come into existence as natural government. The
a paid the
increment of something in existence contract
full price
and the title will vest on the buyer stipulated
of the
when it comes into existence. These that the
MANANSALA VS COURT OF APPEALS land and
are called things of “potential land shall
Facts: thereafter
existence”. be
a deed of
1. Fidela Manansala is the sale was transferred
registered owner of a parcel of executed to Aranez
land in QC. She has been in within 30
in her
possession of the land since 1955 days after
favour in
by virtue of conditional sale made full
1985.
in her favour by PHHC (now NHA). payment
In 1960, however, the PHHC 3. Arane
awarded the land to the spouses z brought
Mercado who took possession of this
the land also in that year. action for
specific
2. Manansala was able to performa
successfully retrieve the land from nce
the Mercado spouses by claiming against

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 25
BLOCK B
2016
SALES DIGESTS BLOCK 2B 2016
of the purchase price by Manansala to the PHHC. The deed was Held:
notarized by Atty. Lopez who was also her counsel against the
1. No, there was no evidence that the sale of the lot was made in
Mercado spouses.
violation of any rules of the PHHC. Further, this contention
4. Manansala denies selling the land; alleging further that the
although raised in the trial court was not pursued by Manansala.
deed was a forgery and that her signature was secured through
In her appeal to the CA, she also never argued this point as she
fraud. She also averred that the selling of the land was void
simply considered the issues raised by the RTC. Hence this point is
because it was made in violation of the prohibition of the PHHC
considered waived and can’t be urged as a ground to reverse the
against subsequent disposition of the land within one year after
decision of the CA. (Conclusion of fact by a trial judge --- as
the issuance of the title.
affirmed by the CA--- is conclusive upon the SC.)
5. The RTC held the signature to be genuine but there was no 2. The signature was found out to be genuine as per the report of
perfected contract since there was no intention to sell the land the NBI. Further,
and because at the time of the sale, the petitioner was not yet the
Manasala’s claim that her signature on the deed had been
owner thereof.
procured through fraud is contradicted by her allegation that the
6. The CA reversed the decision holding that there was meeting of signature on the deed was not hers.
the minds between the party evidence by the signature of the
petitioner in the deed of sale which the NBI found to be genuine.
Further, the CA held that the sale was valid in accordance with
Pio Sian Melliza vs. City of Iloilo, University of the
ART 1461of the Civil Code which provides that things having
Philippines and the Court of Appeals (1968)
potential existence may be the object of a contract of sale.
FACTS:
BLOCKB2016

Issues:
Juliana Melliza owned Lot 2, Lot 5 and Lot 1214. She
1. W/N the CA erred in validating a contract in violation of law and donated a part of Lot 1214 to the Municipality of Iloilo to serve as
public policy? the municipal hall. The donation was revoked by the parties since
the area donated was found inadequate to meet the requirements
2. W/N the challenged notarial document, apart from being of the municipality development plan called the Arellano Plan.
contrary to law and public policy, does not serve the presumption of
regularity?
SALES DIGESTS BLOCK 2B 2016 BLOCK B
2016
Lot 1214 was divided by into several lots, namely: 1214-A, 1214-B, ISSUES:
1214-C and 1214-D. (See illustration below for reference)
1. W/N the conveyance by Juliana Melliza to Iloilo municipality
Juliana executed an instrument which states that she included Lot 1214-B
assigns and transfers certain parts of Lot 1214 to the Municipal
Govt of Iloilo. Juliana sold her remaining interest in Lot 1214 to 2. W/N the description of other lots in the 2nd paragraph of the
Remedios Sian Villanueva who in turn transferred her rights to instrument would be legally insufficient, because the object would
said portion of land to petitioner Pio Sian Melliza. The City of not be determinate as required by law (SALES issue)
Iloilo donated the city hall site together with the building thereon
HELD:
to UP Iloilo, which consisted of Lots Nos 1214-B, 1214-C and 1214-
D. Pio Sian Melliza asked city authorities for payment of value of 1. YES. Accdg to the SC, the public instrument describes four parcels
Lot 1214-B. No recovery was obtained because the City did not of land, Lot 2, Lot 5, Lot 1214-C and Lot 1214-
have funds. Pio Sian Melliza filed in the CFI of Manila an action for
recovery of Lot 1214- B or its value against Iloilo City and UP. D and further describes not only those but also lots needed for
the construction of the city hall site, avenues, parks, according to
Defendants answered claiming that Lot 1214-B was included the Arellano Plan. If the parties merely intended to cover the
in the public instrument executed by Juliana Melliza in favor of Iloilo specified lots, there would have been no need for the 2nd
municipality. Pio Sian Melliza claims that the public instrument is paragraph which describes other portions of land contiguous to
clear that only 1214-C and 1214-D is included and that the 2nd the four lots needed for the said Arellano Plan.
paragraph of said instrument was only to better identify the lots
sold. Petitioner further claims that to hold that 1214-B is included in 2. NO. The requirement of the law that a sale must have for its
the sale would render the contract invalid because the law requires object a determinate thing, is fulfilled as long as, at the time the
as an essential element of sale a “determinate” object. contract is entered into, the object of the sale is capable of being
BLOCKB2016

made determinate without the necessity of a new or further


CFI: dismissed the complaint, saying that instrument by Juliana agreement between the parties. (Art 1460 NCC.) The specific
included Lot 1214-B. mention of some lots plus the statement that the lots object of the
sale are the ones needed for the Arellano Plan sufficiently
CA: affirmed CFI decision, and that the portion sold by Juliana
provides a basis, as of the time of the execution of the contract,
necessarily included whatever was needed for construction of
for rendering determinate said lots without the need of a new and
avenues, parks, city hall site.
further agreement of the parties.

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 26
SALES DIGESTS BLOCK 2B 2016
BLOCK B
2016
The SC also noted that Pio Sian Melliza is the notary public of the Facts:
public instrument executed by Juliana. As such, he was aware of its
terms. Said instrument was also registered with the Register of
Deeds and such registration was annotated at the back of the Title municipality of Zamboanga.
Certificate of Juliana. From these facts, Pio Sian Melliza knew of the The lot was thereafter subdivided into 5 parts (LOT 535-A, LOT
terms or is chargeable with knowledge of them and should have 535- B, LOT 535-C, LOT 535-D, LOT 535-E).
raised the proper objections with Iloilo City and UP’s possession of
Lot 1214-B. He is barred by the principles of civil law, as well as OT 535-E
laches, estoppel and equity.Lot 1214 was executed in the name of his brother, Eulogio Atilano II for
P150.00 The other three lots was sold as well. The only one left
Lot 1214 A for Atilano I was presumably covered by the title to LOT 535-A.
Lot 1214 B ano, the
Lot 1214- defendant.

B Lot
obtained title as to lot 535-E and became co- owners. Years later,
1214-C Lot in order to end the co-ownership and to properly subdivide the
said lot, they had the lot resurveyed. It was here that they
1214-D
discovered that the lot they were occupying was identified as LOT
NOTE: Sorry the digest is long. Kailangan specific sa lot numbers eh. 535-A and not LOT 535-E referred to in the deed of sale.

**For reference, this is how Lot 1214 was divided:


Instance alleging that they offered to surrender the possession of
lot A and demanded in return the possession of lot E.
BLOCKB2016

Atilano vs. Atilano (May 21, 1969) The defendants refused to exchange.
Petitioners, plaintiffs- appelees: Heirs of Atilano II

Respondents, defendants- appellants: Ladislao Atilano and understandable for the said lot has greater area compared to lot A
Gregorio Atilano they were occupying. (lot E = 2612 m2, lot A=1808 m2)

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 27
SALES DIGESTS BLOCK 2B 2016
BLOCK B
2016
but the intention of the
parties at the time of sale.
o Reference to lot E in the Deed of Sale is an involuntary error

o Intention of the parties to the sale covers lot A intended by the parties is lot A where
o Since 1916, Atilano I had been in possession. He even bought
adjoining lot to increase area Atilano II resided , reconstructed his house at the end of the war
and where the heirs continued to
designation of lot E in the deed of sale was a simple mistake in the
that the lot E was registered under Land Registration Act. They
drafting. The mistake did not vitiate the consent of the parties nor
cannot acquire the property through prescription.
affected the validity and binding effect of the contract.
Issue:
no longer needed for the
1. Whether or not the object of the sale is lot 535-E thus, parties have already retained possession in conformity with the
allowing such exchange of possession. real intention of the parties.

Held:

No.
Shorter narration of facts:

he sees it, in its actual setting

parts. What was left for him was


BLOCKB2016

and by its physical metes and bounds and not by the mere lot
number assigned to it in the certificate of title.
presumably covered by title to lot 535-A.
o Atilano II constructed his resident therein even before sale in
his favour identified as lot
deed of sale executed covered lot 535-E.
A.
Years later, when Atilano II and his children had the lot E
o Atilano I on the other hand had his house on lot E and even resurveyed, they discovered that the lot was
purchased adjoining lot.
identified as lot 535-A.
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 28
SALES DIGESTS BLOCK 2B 2016 BLOCK B
2016
that the contract was limited to sugar he might raise upon his own
exchange of the lot E occupied by Ladislao plantation; that the contract represented a perfected sale; and that
by failure of his crop he was relieved from complying with his
Atilano, successor of Atilano I after he died. (Apparently, lot A has undertaking by the loss of the thing due (i.e dry season in his
greater area than lot B). However, hacienda, he could not produce and deliver any sugar).
Ladislao refused. Issue:

1. Whether or not there was perfected contract of sale?

Held:
o Reference to lot E in No, there is no perfected contract
the Deed of Sale is an of sale. The SC ruled that
involuntary error
o Intention of the parties service, he will receive
to the sale covers lot A compensation of P3, 000, as
evidence in a receipt. He
o Since 1916, Atilano I
will deliver the 600 piculs of
had been in possession.
sugar at any place in Santa
He even bought adjoining
Rosa. The service contract
lot to increase area.
also has a 3-month period
stipulation. The contract
also states that Mr.
Yu Tek & Co vs. Basilio Gonzales shall return the P3,
Gonzales 000 and give P1,200 by way
Facts: of indemnity in case the
contract is rescinded. Mr.
Yu Tek and Co
BLOCKB2016

Gonzales failed to deliver.


obliged Mr. Basilio
He was also unable to
Gonzales to deliver 600
return the P3000 and
piculs of sugar of the 1st
payP1200 indemnity. For
and 2nd grade. For this
his defense, Mr. Gonzales
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 29
SALES DIGESTS BLOCK 2B 2016 BLOCK B
2016
contends there is a perfected party obligates sugar, is not perfected
sale with regard to the himself to sell for a until the quantity
“thing” whenever the price a certain agreed upon has been
article of sale has specified quantity of selected and is capable
been physically sugar of a given of being physically
segregated from all quality, without designated and
the other articles. In designating any distinguished from all
the case at bar, there particular lot of the other sugar.
was no NATIONAL GRAINS palay. In the Farmer's
“appropriation” of any AUTHORITY and Information Sheet, the
particular lot of sugar. WILLLAM CABAL vs. maximum number of
Thus, there was only THE INTERMEDIATE cavans of palay that Soriano
an executor APPELLATE COURT and may sell to the NFA was
agreement and a indicated – 2640 cavans.
LEON SORIANO, FACTS:
promise of a sale. It is
- A day after submitting the
clear that Art. 1452, - In 1979, private
required documents,
1096 and 1182 are not respondent Leon Soriano
Soriano delivered 630
applicable. Yu Tek and offered to sell palay
grains to the NFA cavans of palay to the NFA
Co is entitled to
warehouse. The palay
receive P3,000.
(National Food Authority, delivered during these two
Ratio: which was previously days were not rebagged,
called the National Grains classified and weighed.
1. Requisites of a Authority), through one of
Contract. - Soriano demanded
its provincial managers,
Consideration. A payment of the 630 cavans
William Cabal.
contract of sale is not of palay. However, Cabal
BLOCKB2016

perfected until the - Private respondent wrote to Soriano stating


parties have agreed Soriano eventually that NFA cannot legally
upon the price and submitted to the NFA accept the said delivery
the thing sold. A several documents because a certain Napoleon
contract whereby a required for the sale of Callangan certified that
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 30
SALES DIGESTS BLOCK 2B 2016 BLOCK B
2016
Soriano is not a bona Both the RTC and the - Regarding the long as it does not
fide farmer. Asserting Intermediate validity of the subject exceed 2,640 cavans.
that there was no valid Appellate Court matter of the contract,
contract of sale, Cabal decided in favor of the fact that the exact
advised Soriano to private respondent number of cavans of
withdraw from the NFA Soriano. palay to be delivered
warehouse the 630 was not specified
cavans previously ISSUE: does not affect the
delivered. perfection of the
1. W/N there was a contract
of sale in the case at bar? contract.
- Instead of
withdrawing the 630 HELD: o Because Article 1349
cavans of palay, private states that: “The fact
respondent Soriano YES, there was a contract of sale. that the quantity is not
insisted that the palay determinate shall not
- In the case at bar,
grains delivered be be an obstacle to the
when the NFA
paid. He then filed a existence of the
accepted the offer by
complaint for specific contract, provided it is
noting in Soriano's
performance and/or possible to determine
Farmer's Information
collection of money the same, without the
Sheet a quota of
with damages against need of a new contract
2,640 cavans, there between the parties."
the NFA and Mr.
was already a
William Cabal.
meeting of the minds o In this case, there
between the parties. was no need for NFA
Sale is a consensual and Soriano to enter
contract wherein the into a new contract to
mutual consent of the determine the exact
parties shall lead to number of cavans of
the perfection of the palay to be sold.
contract. Soriano can deliver so
much of his produce as
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 31
BLOCK
SALES DIGESTS BLOCK 2B 2016 2016 B
- The reason BAC
why NFA
initially K&
refused
acceptance of SON
the 630 S
cavans
of palay PHIL
delivered by
Soriano is
that NFA IPPI
alleges that
Soriano is not
a bona fide NE
farmer. TRA
The trial court DIN
and the G
appellate
COR
court found
POR
that Soriano
ATIO
was a bona
fide farmer N vs.
and THE
therefore, he HON
was qualified .
to sell palay COU
grains to NFA. RT
OF
APP
JO EALS
HA Facts:
NN
• In 1981, SJ
ES
industrial
SC contacted with
HU Schuback to
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 31
purchase bus spare parts from • SJ Industrial eventually submitted the quantity manifested
of units it would - Contract
Germany. like to purchase, along with the inscription by the
“this will serve as our
initial purchase order”. of sale is meeting of
• SJ Industrial also gave a list of bus perfected
• Schuback then ordered the parts from its the offer
spare parts that it would like to at the
German Office. and
purchase. moment acceptance
• Schuback issued an invoice so there is a upon the
• Schuback then communicated with
that SJ Industrial can apply for a meeting thing and
its German office to provide an
letter of credit in favour of of minds the cause
estimate of costs.
Shuback upon the which are
• After this, Shuback provided SJ thing to
• After some time, Schuback
BLOCKB2016

Industrial its formal offer, which is constitute


reminded SJ of its obligation to
containing a list of prices, item the object the
open a letter of credit,SJ
number, quantity, part number and of the contract.
responded by stating that it I
description to SJ industrial. contract The offer
encountering difficulties in doing
and upon must be
• SJ Industrial then informed so
the price. certain and
Schuback of its desire to purchase
• Schuback then wrote again, the
and submitted a purchase order - Article
demanding that SJ either open a acceptance
containing the item number, part 1319 of
letter of credit and proceed with the absolute. A
number and description. the Civil
order or pay the cancellation fee. qualified
Code
• It also promised to follow up in the acceptance
• SJ Industrial failed to do either. Schuback states:
purchase order the quantity of units it constitutes
sued for damages "Consent
would like to purchase. a
is
Issue:
SALES DIGESTS
1. W/N there was a perfected contract of
sale?
BLOCK 2B 2016
counter been
manifested
offer." The
Held: facts indicate - The act of SJ
that consent Industrial in
Yes on both sides
has informing
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 32
BLOCKB2016

Schuback of its desire to purchase - Schuback, in its dealings with SJ CONCHITA NOOL s, Anacleto
and GAUDENCIO
after receiving a formal offer Industrial, did not incorporate any ALMOJERA vs. Nool
COURT OF
constitutes a meeting of the minds. provision declaring their contract of sale APPEALS, ANACLETO (Conchita’s
NOOL and EMILIA
without effect until after the fulfillment NEBRE younger
- The inscription “this will serve as of the act of opening a letterof credit. FACTS: brother)
our initial purchase order” proves
T and Emilia
further the acceptance of the offer.
wo (2) Nebre, now
- The Trial Court is correct in stating parcels of the
that there was a perfected contract land are in appellees.
of sale. It erred however, when it dispute
and Co
said that the perfection only
litigated nchita and
occurred when the quantity to be
upon her
purchased was submitted by SJ
here. The husband
Industrial.
plaintiff bought the
- Perfection occurred when the initial spouses, two
purchase order was issued even if the Conchita parcels of
quantity to be purchased was not yet Nool and land from
available as quantity is not a material Gaudencio her two
to perfection Almojera, brothers
now the Victorino
- What is of importance is the Nool (1
appellants
meeting of the minds as to the object hectare)
, seek
and cause and
recovery
of the Francisco
- The omission to open a letter of
aforemen Nool (3
credit does not prevent the
tioned hectares).
perfection of the contract between
parcels of As they
the parties, for the opening of the
land from were in
letter of credit is not to be deemed
the dire need
a suspensive condition.
defendant of money,

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 33
they obtained a loan from the
Ilagan Branch of the DBP, in
Ilagan, Isabela, secured by a real
estate mortgage on said parcels
of land, which were still
registered in the names of
Victorino Nool and Francisco
Nool, at the time, and for the
failure of plaintiffs to pay the
said loan, including interest and
surcharges, totaling P56,000.00,
the mortgage was foreclosed.

The one year


redemption period for the
foreclosed parcels of land was
from March 16, 1982 to March
15, 1983 but the mortgagor’s
right of redemption was not
exercised by the plaintiff
spouses.

Because they were


unable to redeem the property,
Conchita asked her brother
Anacleto Nool to redeem the
foreclosed properties from DBP,
which the latter did; and as a
result, the titles of the two (2)
parcels of land in question were
transferred to Anacleto Nool.

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 34
BLOCK
SALES DIGESTS BLOCK 2B 2016 2016 B
Defendant Anacleto having defendants
been made to believe,
then, (Anacleto)
that his sister, Conchita,
still had the right to failed to pay,
redeem the said
properties and the same
had day the said
agreement arrangement
with Conchita was made;
to purchase another
the two (2) covenant was
parcels of entered into
land for a by the parties,
total price of whereby
P100,000.00, Anacleto
P30,000.00 of agreed to
which price return to
was paid to Conchita the
Conchita, and lands in
upon question, at
payment of anytime the
the balance of latter have the
P14,000.00, necessary
plaintiffs amount (the
(Conchita) repurchase
were to agreement);
regain that Conchita
possession of asked the
the two (2) Anacleto to
hectares of return the
land, which same but
amounts despite the
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 33
intervention of the Barangay 2.) Does Conchita have a right to enforce the Electric
repurchase
Captain of their place, Anacleto agreement? Chapter 4: Price Railroa
refused to return the said parcels of NO. One “repurchases” and Other d and
land to Conchita. Anacleto theorized only what one has previously sold.
Consideration. Light
that they acquired the lands in In other words, the right to
repurchase presupposes a valid Compa
question from the Development
contract of sale between the same ny
Bank of the Philippines, through Mitsui
parties. Undisputedly, respondents GR No. 13753, February
negotiated sale, and were misled by Bussa 15, 1919, J. Street.
Conchita when defendant Anacleto (Anacleto) acquired title to the
n
Nool signed the private writing, property from DBP and not from Petitioner, Mitsui
Kaish
agreeing to return subject lands petitioners (Conchita). Bussan Kaisha
a vs.
when plaintiffs have the money to
Note: Manil Respondent, Manila
redeem the same.
a Electric Railroad and
ISSUES and HELD: if this is hard to understand Light Company
try reading the actual case kasi mas Sum B
1.) Was the sale of Conchita to mar SALES
magulo. Basta in short, Conchita L
Anacleto valid? y/
DIGESTS
BLOCKB2016

was selling to her brother Anacleto Me O


land that she no longer owns mor
NO. At the time Conchita
y
BLOCK 2B C
offered to Anacleto the purchase of because she was beyond the 1 year Aid: 2016 K
the parcels of land she no longer redemption period and had no
Whether
had ownership of them as they chance to redeem her land from or not B
were already foreclosed and she DBP. And because Anacleto was Mitsui 2 or
0
1
made to believe that Conchita still Manila6
did not exercise the mortgagor’s Electric
right to redeem them within a year. had the right to redeem the is liable
DBP was already the absolute properties from DBP he agreed to to pay
her offer of selling him the land. the
owner of the parcels of the land at addition
that time, thus Conchita had no Kumbaga maloko din to si Conchita al taxes
na binebenta nya pa kay Anacleto Mitsui & Sale of Coal
object to sell. The sale was UTTERLY Manila
ang lupa na nabili na mismo ni Electric
VOID AND INEXISTENT. Railroad and Act
Light
Company
Contract of 2432
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 34
& Act 2445, additional tax Manila Electric; however, Manila Electric Held/Ratio: contained
refused. Thus, Mitsui files this present T no
of P1/ metric ton Facts: action to recover the amount paid. The express
he SC
Mitsui Bussan Kaisha, a lower court ruled in favor of Mitsui. held provision
Japanese company, had a contract of that by on this
Issue: point and
sale of coal to Manila Electric the
Railroad and Light Company. The express the
price agreed upon was P9.45 per terms of parties
long ton of coal but it was “subject Act made no
to modification in variations in 2445, contract
calories, ash content and not the with
otherwise”. burden reference
of the thereto
On December 23, 1914, Act after Act
tax
No 2432 was passed which 2445 was
should
imposed a specific tax of P1 per passed.
be
metric unit on coal. This act was The seller
borne
amended in Act No. 2445, which is relieved
by
stated that “… the burden of said of the
Manila
tax or increased rate of tax shall be burden of
Electric
borne by the person to whom the tax.
Compan
said article is furnished pursuant to Act 2445
y
such contract, unless the parties
“unless specificall
have agreed otherwise”.
the y applies
From March to October parties to
contracts
BLOCKB2016

1915, Mitsui delivered to Manila have


Electric 11,874 metric tons of coal. agreed with fixed
The tax imposed by Act 2432 and otherwi prices.
2445 when applied to this delivery is se”. The This is
P11,874.75. Mitsui paid the taxes and original since the
asked for reimbursement from contract seller who
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 35
had made deliveries in stated may demand reimbursement at
quantities at the current least to the extent that payment
market price and not at a fixed may have been beneficial to the
price needed no relief since debtor.
their prices would immediately
increase and automatically
apply upon imposition of said
Act.

The buyer’s defense in


stating that the exception
clause in the original contract is
to be interpreted in favor of
them (i.e. they are not entitled
to pay taxes) must fail. This
exceptional clause of “subject
to modification in variations in
calories, ash content and not
otherwise” pertains only to the
quality of coal and ascertaining
the value of coal by
determining its combustion. It
has no bearing upon liability for
internal revenue tax. Thus,
Manila Electric is liable to pay
reimbursement of P11,874.45
to Mitsui by express provision
of Act 2445. This is also in
accordance with the law of
Obligation and Contracts that
anyone who pays for another
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 36
SALES DIGESTS BLOCK 2B 2016
BLOCK B
2016
VILLANUEVA V. CA in buying the property.
G.R No. 107624 January 28, 1997

Panganiban, J.

Petitioners: Spouses Villanueva

Respondents: Spouses Dela Cruz, Spouses Pile

SUMMARY/MEMORY AID:

Spouses Villanueva assert that there was a perfected


contract of sale between them and the defendants, the Spouses
Dela Cruz. Their allegation is based on the P10,000.00 they gave
to the defendants. However, the evidence shows that the actual
price of the leased land was not fixed. Price must be certain; it
must be real, not fictitious. It is not necessary that the certainty
of the price be actual or determined at the time of executing the
contract, as long as the contract furnishes a basis or measure for
ascertaining the amount agreed upon. Since there was no
meeting of the minds between the petitioners and the
defendants, there was no perfected contract of sale.

FACTS:
BLOCKB2016

Petitioner Gamaliel Villanueva has been a tenant-


occupant of a unit in the 3-door apartment building erected on
a parcel of land owned by the private respondents, Sps. Dela
Cruz.

About February of 1986, respondent Jose Dela Cruz


offered said parcel of land with the 3-door apartment building
for sale and the petitioners, the Sps. Villanueva, showed interest
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 35
Jose dela Cruz asked petitioner Irene Villanueva for a
certain amount to pay for the taxes so that the property would be
cleared of any encumbrance. Villanueva agreed and gave
P10,000.00 on two occasions. Allegedly, it was agreed by them
that said P10,000.00 would form part of the sale price of
P550,000.00 for the parcel of land.

Sometime in March 1987, defendants Dela Cruz executed


in favor of their co-defendants, the Sps. Pile, a Deed of Assignment
of the other one-half portion of the parcel of land wherein
petitioner Gamaliel Villanueva's apartment unit is situated. The
petitioners objected to Dela Cruz’ sale to the Sps. Pile because they
assert that a contract of sale over the parcel of land had already
been perfected between themselves and the Sps. Dela Cruz. The
petitioner eventually elevated their complaint to the trial court.

Petitioners contend that the P10,000 they gave was partial


or advance payment of the property. Necessarily then, there must
have been an agreement as to price. They cite Article 1482 of the
Civil Code which provides that "whenever earnest money is given
in a contract of sale, it shall be considered as part of the price and
as proof of the perfection of the contract."

However, private respondents contradict this claim with


the argument that the P10,000.00 was only payment for realty tax
was going to form part of the consideration of the sale if and when
the transaction would finally be consummated. Private
respondents insist that there "was no clear agreement as to the
true amount of consideration."

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 36
SALES DIGESTS BLOCK 2B 2016 BLOCK B
2016
The I
trial
court S
rende S
red
its U
decisi
on in E
favor
:
of
respo W/N there
ndent was a
An
duly s. was
appeal
brought perfected
to the
which CAthe
affirmed
said
d contract of
sale of
e
subject
c property
between
i the
petitioners
s
(Sps.
i Villanueva)
and
o respondent
s (Sps.
n
Dela Cruz)
. HELD/RATIO:

NO, THERE
WAS NO
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 36
PERFECTED CONTRACT OF SALE admission" is allegedly the "best proof already a definite that the
BECAUSE A MEETING OF THE of its existence." This argument is agreement as to the certainty of
MINDS REGARDING THE PRICE unmeritorious because even if such price. And it would the price
WAS LACKING. draft deed existed, it does not not
have commanded
probative value as any
it be actual or
was not signed.
necessarily follow that there was 4. The determine
1. According to the testimony of price of d at the
respondent Dela Cruz, he or his the time of
spouse had never agreed to a leased executing
definite price for the subject land not the
property. In fact, his testimony having contract, as
during the cross-examination been long as the
firmly negated any price fixed, contract
agreement with petitioners one of furnishes a
because he and his wife was the basis or
adamant on the price of essential measure
P575,000.00 and did not agree to elements for
reduce it to P550,000.00, the price which ascertainin
preferred by petitioner. give life g the
2. Petitioners allege that an to the amount
unsigned deed of sale was prepared contract agreed
by private respondent Jose Dela of sale upon. A
Cruz. Unfortunately, such was not was contract of
BLOCKB2016

presented in evidence. lacking. sale is not


Price void for
3. However, petitioners aver that must be uncertainty
even if the unsigned deed of sale certain, it when the
was not produced, private must be price can
respondent Jose dela Cruz admitted real, not be made
in court that he prepared said deed fictitious. certain by
“in accordance with their It is not reference
agreement." This “judicial necessary to existing
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 37
invoices identified in the moment there is a meeting
agreement. In this respect, the of minds upon the thing
contract of sale is perfected. The which is the object of the
price must be certain, otherwise contract and upon the
there is no true consent price. Consent is
between the parties. There can manifested by the meeting
be no sale without a price. In of the offer and the
the instant case, however, what acceptance upon the thing
is dramatically clear from the and the cause which are to
evidence is that there was no constitute the contract. The
meeting of mind as to the price, offer must be certain and
expressly or impliedly, directly the acceptance absolute.
or indirectly.

JOSE R. MORENO, JR. vs Private


Management Office
G.R.

No.

159373 November

16,

2006

Memor

y Aid:

1. A contract of sale is
perfected at the
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 38
SALES DIGESTS BLOCK 2B 2016 BLOCK B
2016
2. To nothin
reach g can
that be left
mome open
nt of for
perfec furthe
tion, r
the arrang
partie ement
s must . So
agree
on
the long as
same
thing
in sothe
same
sense
,minds
that
their
meet there
as to is any
all uncert
the ainty
term or
s. indefin
The iteness
mind , or
s of future
parti negoti
es ations
must or
meet consid
at eration
ever s to be
y had
point betwe
; en the
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 37
BLOCKB2016

parties, there is not a Facts: -PMO called for a trustee,


completed contract, and in conference with informed
fact, there is no contract at -Moreno owns several floors of the Moreno, because it Moreno
all. J.Moreno Bldg as well as the lot where wants to sell that the
the
which
rightfloors it owns
building,
ofMoreno hasina
over
3. Contract formation it stands Board is
refu
undergoes three distinct -PMO, on the other hand,is a sal. in
stages – preparation or government agency that owns the At agreemen
negotiation, perfection or other floors of the J.Moreno Bldg the t that Mr.
birth, and consummation. mee Jose
Negotiation begins from the ting, Moreno,
time the prospective PM Jr. has the
contracting parties manifest O right of
their interest in the contract stat first
and ends at the moment of ed refusal"
agreement of the parties. The that and
perfection or birth of the the requested
contract takes place when pric Moreno
the parties agree upon all the e is to deposit
essential elements thereof. 21 10% of
The last stage is the Milli the
consummation of the on "suggeste
contract wherein the parties Pes d
fulfill or perform the terms os indicative
agreed upon, culminating in - A few price" of
its extinguishment. Once days P21.0
there is concurrence of the later, million on
offer and acceptance of the PMO, in or before
object and cause, the stage of a letter February
negotiation is finished. signed 26, 1993
by its - More

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 38
no paid the P2.1 million on
February 26, 1993 for which
PMO issued a receipt.

- Subsequently however,
PMO sent a letter saying that
its legal department has
questioned the basis for the
computation of the indicative
price for the said floors

- PMO also wrote that


its Board has
"tentatively agreed on a
settlement price of
P42,274,702.17" for the
said floors.

-Moreno questions the actions


of PMO, claiming that they
already agreed and perfected
a contract of sale over the said
floors for the amount ofP21.0
million

Issue:

W/N there was a


perfected contract of sale
for the price of 21 Million
pesos?

Held: No
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 39
BLOCK
SALES DIGESTS BLOCK 2B 2016 2016 B
4. A the
contra
ct of accept
sale is ance
perfec
ted at upon
the the
mome
nt thing
there and
is a
meeti the
ng of
minds
upon cause
the
thing
which which
is the
object are to
of the
contr constit
act ute the
and contra
upon ct. The
the offer
price must
. be
Cons certain
ent is and
mani the
feste accept
d by ance
the absolu
mee te.
ting 5. To
of reach
the that
offer mome
and nt of
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 38
perfection, the parties must essential elements thereof. The 8. The letter t
sent by PMO
agree on the same thing in last stage is the consummation is merely a h
the same sense, so that their of the contract wherein the suggestive e
indicative
minds meet as to all the parties fulfill or perform the price of the m
subject floors
as it was yet to
terms. The minds of parties terms agreed upon, culminating be approved o
by
must meet at every point; in its extinguishment. Once t re
nothing can be left open for there is concurrence of the offer h .
further arrangement. So and acceptance of the object e T
long as there is any and cause, the stage of h
uncertainty or indefiniteness, negotiation is finished. B e
or future negotiations or o la
7. In this case, it is clear
considerations to be had a w
between the parties, there is that the parties are not g
r
not a completed contract, past the negotiation o
d
and in fact, there is no stage. v
contract at all. o er
f ni
6. Contract formation n
undergoes three distinct g
T
stages – preparation or t
r
negotiation, perfection or h
u
birth, and consummation. e
s
Negotiation begins from the P
t
time the prospective
BLOCKB2016

e M
contracting parties manifest O
e
their interest in the contract ,
s
and ends at the moment of a
.
agreement of the parties. The g
perfection or birth of the o
F
contract takes place when v
u
the parties agree upon all the er
r
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 39
nment agency, letter in question is a mere 1726 pro
SALES DIGESTS who
imposes an additional evidence of a 74
July BLOCK 2B 2016 pay
suspensive condition memorialization of
12, t Ban
that sales of inconclusive negotiations,
2007 o
government assets or a mere agreement to r
must be approve by agree, in which material ef
e
the Committee on term is left for future
r
Privatization negotiations. t
9. Suggestive Indicative o
11. It is a mere evidence of the it
Price cannot be w
parties’ preliminary
interpreted as a price o
transactions which did not ul
certain. Under the
crystallize into a perfected d-
objective theory of b
contract. Preliminary
contract, e
negotiations or an b
understandings and
agreement still involving u
beliefs are effective y
future negotiations is not e
only
the functional equivalent rs
if shared. Based on o
of a valid, subsisting
the objective f
agreement.. For a valid t
manifestations of
contract to have been h
the parties in the e
created, the parties must
case at bar, there f
have progressed beyond o
was no meeting of
this stage of imperfect r
the minds e
negotiation. But as the
cl
10. The letter constituted a records would show, the o
definite, complete and parties are yet undergoing s
the preliminary steps e
certain offer is the d
subjective belief of towards the formation of a R
petitioner alone. The valid contract. R
R
Navarra v. Planters Development Bank G.R. C
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 40
2016 payments
be would
considered as then
BLOCK B redemption
RRRC. price for foreclose
Sps. Jorge Navarra and Carmelita redemption period. The foreclosed d for
Bernardo Navarra and RRRC
properties of RRRC P1,800,00
Development Corporation –
BLOCKB2016

On the other hand, co- were sold to third


Petitioner persons and 0.00, with
petitioner RRRC Development a request
the
Planters Development Bank and Corporation (RRRC) is a real estate
payme that he be
Roberto Gatchalian Realty Inc. - company owned by the parents of
nts to given until
Respondent Carmelita Bernardo Navarra. RRRC
the August
obtained a loan from Planters Bank 31, 1985
Petition to set aside the assailed bank
secured by a mortgage over another
decision of the CA reversing the even to pay the
set of properties owned by RRRC. The down
decision of the RTC ruling that exceed
loan having been likewise unpaid,
there was a perfected contract of ed the payment
Planters Bank similarly foreclosed the of
sale. redem
mortgaged assets of RRRC. Unlike the
ption P300,000.
Facts: Navarras, however, RRRC was able to 00.
price
negotiate with the Bank for the
by Unable to
The spouses Jorge and redemption of its foreclosed
P300,0 pay when
Carmelita Navarra are the owners properties. The Bank allowed RRRC
00.00. the time
of 5 parcels of land located at B.F.
came,
Homes, Parañaque. When the T Jorge
spouses obtained a loan of he asked the
P1,200,000.00 from Planters Bank, Navarra bank if
they executed a deed of mortgage s then the
over the 5 parcels of land. When wrote P300,000.
the couple failed to pay, the bank the bank 00 excess
foreclosed on the mortgage and proposin of RRRC
mortgaged assets were sold to it for g to can be
P1,341,850, it being the highest repurch applied in
bidder in the auction sale. The ase the the
spouses Navarra did not redeem 5 lots meantime
their properties in the one-year earlier as down
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 41
payment for their lots. The of the minds between the
bank agreed but required the parties?
submission of a board
“DEFINITELY NOT.”
resolution from RRRC allowing
the application of the excess
as down payment by the
spouses.
Because the bank was never
given a copy of the board
resolution, it sent a letter to
Jorge Navarra informing him
that it could not proceed with
the documentation of the
proposed repurchase of the
foreclosed properties. The
Navarras then filed a
complaint for Specific
Performance with Injuction as
a portion of the lot was by
Planters Bank to herein co-
respondent Roberto
Gatchalian Realty, Inc.
(Gatchalian Realty).

Issue: Was the repurchase


agreement between the
spouses Navarra and the
bank perfected? Was the
offer certain and the
acceptance absolute enough
so as to engender a meeting

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 42
SALES DIGESTS BLOCK 2B 2016
BLOCK B
2016
 The element of a price certain was missing. Mapalo v. Mapalo
Although P300,000.00 was stated as down G.R. No. L-21489 and L-21628 May 19, 1966
payment, the letter was completely silent as to
how the succeeding installment payments shall be Memory Aid / Doctrine:
made.
With the intention of donating, illiterate Mapalo spouses
 At most, the letters merely acknowledge that the down were tricked into selling an entire parcel of land instead of half of
payment of P300,000.00 was agreed upon by the the land in “consideration of 500php” which they never received. ||
parties. A contract of purchase and sale is null and void and produces no
effect whatsoever where the same is without cause or
 The Navarras’ letter/offer failed to specify a definite consideration in the purchase price which appears thereon as
amount of the purchase price for the sale/repurchase paid has in fact never been paid by the purchaser to the vendor.
of the subject properties. It merely stated that the
“purchase price will be based on the redemption value FACTS:
plus accrued interest at the prevailing rate up to the
Spouses Miguel Mapalo and Candida Quiba, simple
date of the sales contract.” The ambiguity of this
illiterate farmers, were registered owners, with Torrens title
statement only bolsters the uncertainty of the
certificate O.C.T. No. 46503, of a 1,635-square-meter residential
Navarras’ so-called “offer” for it leaves much rooms
land in Manaoag, Pangasinan. Out of love and affection for
for such questions, as: what is the redemption value?
Maximo Mapalo — a brother of Miguel who was about to get
what prevailing rate of interest shall be followed: is it
married — the spouses decided to donate the eastern half of the
the rate stipulated in the loan agreement or the legal
land to him. O.C.T. No.
rate? When will the date of the contract of sale be
46503 was delivered in 1936, but they were deceived into signing
based, shall it be upon the time of the execution of the
a deed of absolute sale over the entire land in his favor. Maximo
deed of sale or upon the time when the last
BLOCKB2016

and his attorney led the illiterate spouses to believe that what
installment payment shall have been made? To our
they signed was a deed of donation in Maximo's favor covering
mind, these questions need first to be addressed,
only one- half (the eastern half) of their land. Although the
discussed and negotiated upon by the parties before a
document of sale stated a consideration of Five Hundred
definite purchase price can be arrived at.
(P500.00) Pesos, the spouses did not receive anything of value for
the land.

Subsequently the Mapalo spouse built a fence in the middle


Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 40
of their land segregating the eastern portion from its western portion.
Said fence still exists. The spouses have always been in

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 41
SALES DIGESTS BLOCK 2B 2016 BLOCK B
2016
continued registered in
possession 1951 and
over the Transfer
western half Certificate of
of the land Title No. 11350
up to the
present. was issued for
Mea the whole land
nwhile, in their names.
Maximo The Narcisos
registered took
the deed of possession only
sale in his of the eastern
favor and
portion of the
obtained in
land in 1951,
his name
after the sale
TCT No.
in their favor
12829 over
was made.
the entire
land. CFI decision:
Thirteen
years later in In 1952
1951, he sold the Narcisos
the entire filed a suit in
land for the CFI to be
2500php in declared
favor of the owners of the
BLOCKB2016

Narcisos. The entire land, for


sale to the damages, and
Narcisos was for rentals. The
in turn Mapalo
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 41
spouses filed their answer with a favor of the Mapalos. The court said that the s e;
counterclaim in1965, seeking donation
void as towas
thenull and half of the land.
western a
cancellation of the TCT of the CA decision: l 2.
Narcisos as to the western half of e W
The Narcisos appealed to
the land, on the grounds that their t
the Court of Appeals. CA reversed
(Mapalos) signatures to the deed of o /
the judgment of the CFI, solely on
sale of 1936 was procured by fraud M
the ground that the consent of N
and that the Narcisos were buyers a
the Mapalo spouses to the deed
in bad faith. They asked for xi
of sale of 1936 having been
reconveyance to them of the m
obtained by fraud, the same was
western portion of the land and o t
voidable, not void ab initio, and,
issuance of a Transfer Certificate of is
therefore, the action to annul the h
Title in their names as to said v
same, within four years from
portion. The Mapalo spouses also o e
notice of the fraud, had long
filed in 1957 their own complaint in i
prescribed. It reckoned said
the CFI of Pangasinan against the d
notice of the fraud from the date
Narcisos and Maximo Mapalo. They o
of registration of the sale on N
asked that the deeds of sale of 1936 r
March 15, 1938. The Court of First
and of 1951 over the land in m a
Instance and the Court of Appeals
question be declared null and void e
are therefore unanimous that the
as to the western half of said land. r r
spouses Mapalo and Quiba were
e
Judge Santiago of the CFI of definitely the victims of fraud. It c
l
Pangasinan tried the two cases was only on prescription that
y i
jointly. The CFI rendered judgment they lost in the Court of Appeals.
v
on January 18, 1961, ruling in s
ISSUES: o
i
1. W/N, under the Old Civil o
d
Code which was in effect a s
at the time of the b
execution of the sale, the l
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 42
are purchasers in

good faith HELD:

1. The sale is VOID.

Under the Civil Code, either


the old or the new, for a
contract to exist at all, three
essential requisites must
concur: (1) consent, (2) object,
and (3) cause or
consideration.1 In the case at
hand, the first

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 43
SALES DIGESTS BLOCK 2B 2016
BLOCK B
2016
and second elements are present, but the third is lacking (and “It has been positively shown by the undisputed
on that point the CA was completely silent). testimony of Candida Quiba that Pacifico Narciso and Evaristo
Narciso stayed for some days on the western side (the portion in
Was there a cause or consideration to support the
question) of the above-described land until their house was
existence of a contract of sale? Since the deed of sale was
removed in 1940 by the spouses Mapalo and Quiba; secondly,
governed by the Old Civil Code, it should be asked if in this case
Pacifica Narciso admitted in his testimony in chief that when they
there is no consideration, or one with a statement of false
bought the property, Miguel Mapalo was still in the premises in
consideration. If the former, it is void and inexistent. If the latter,
question (western part) which he is occupying and his house is
it is only voidable under the Old Civil Code. The deed of sale of
still standing thereon; and thirdly, said Pacifico Narciso when
1936 stated that it had for its consideration P500.00 when in fact
presented as a rebuttal and sub-rebuttal witness categorically
said consideration was totally absent. The problem, therefore, is
declared that before buying the land in question he went to the
whether a deed which states a consideration that in fact did not
house of Miguel Mapalo and Candida Quiba and asked them if
exist, is a contract without consideration, and therefore void ab
they will permit their elder brother
initio, or a contract with a false consideration, and therefore, at
Maximo to sell the property.”
least under the Old Civil Code, voidable.
The SC reversed and set aside the decision of the CA and
According to Manresa, what is meant by a contract that
rendered another reaffirming in toto the judgment of the CFI, with
states a false consideration is one that has in fact a real
attorneys’ fees on appeal in favor of the Mapalo spouses in the
consideration but the same is not the one stated in the document.
amount of 1,000.00 Php plus costs, against both Maximo and the
A contract of purchase and sale is null and void and produces no
Narcisos.
effect whatsoever where the same is without cause or
consideration in that the purchase price which appears thereon as
paid has never been paid by the purchaser to the vendor.
BLOCKB2016

Rongavilla v. CA
There was no contract of sale in this case. The inexistence G.R. No. 83974 August 17, 1998
of a contract is permanent and incurable and cannot be the
subject of prescription. *fact heavy case!

2. Narcisos are purchasers in bad faith. Memory Aid:

SC quoted the CFI: In all contractual, property or other relations, when one of the
parties is at a disadvantage on account of his moral dependence,

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 42
ignorance, indigence, mental weakness, tender age, or other

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 43
SALES DIGESTS BLOCK 2B 2016
BLOCK B
2016
handicap, the courts must be vigilant for his protection. (Art. 24,  Respondents filed with the RTC of Pasay to have the deed
Civil Code) of sale declared void and inexistent for 2 grounds: (1) lack
of consent and (2) want of consideration.
Facts:
 Petitioners’ defense: (1) prescription had set in already and
 Mercedes dela Cruz and Florencia dela Cruz are spinsters
(2) deed of sale was valid as it contains all the requisites of
who own 1/2 of a parcel of land located in Manuyo, Las
a contract.
Pinas. They are dressmakers who can read and write in
Tagalog but unschooled in English. Their nieces are:
Juanita Jimenez and petitioner Dolores Rongavilla.
(whole land was subdivided beforehand, property under Trial court (RTC Pasay) – deed of sale void, reconvey property to
contestion here is the half that belongs to the dela Cruz private respondents
sisters) CA- affirm RTC decision (plaintiff respondents did not know that
what they were signing was a deed of absolute sale. This means
 Sometime in May 1976, private respondents
borrowed P200 from the petitioners to have their that their consent was not only vitiated, there was no consent at
roof repaired. all)

 Petitioner Rongavilla made the respondents sign a Issue:


document written in English, claiming that it was Did the Court of Appeals err when it upheld the trial court's
only a document to evidence their debt of P2000.
judgment that the disputed Deed of Sale is void and inexistent?
 After four years, Rongavilla went back to respondents Held: No.
place asking them to vacate the premises, that she and
her husband were now the owners of the land.  Petitioner’s defense that the deed of sale was valid and
that they were the ones paying taxes cannot stand
BLOCKB2016

 Respondents went to the Register of Deeds to verify the because they admitted in court that they changed the
matter and found out that what they have signed was a price in the deed of sale.
deed of sale. Their Certificate of Title had been
cancelled and a new one issued to the petitioners. The o Petitioners said that the real amount they paid to
land now has even been mortgaged by petitioners with respondents was P7,800 but only put P2,000 in
the Cavite Development Bank. the Deed of Sale to save taxes.

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 43
SALES DIGESTS BLOCK 2B 2016
BLOCK B
2016
o In the deed of sale, the original price printed therein refused since he did not owe Tan anything and was under no
was actually P3000, then petitioners changed it to obligation to covey to Tan his properties. After a long discussion,
P2000 by writing over it. (gulo nila diba? Well Josie succeeded in convincing Mate to execute a fictitious deed of
naguluhan din ung court, kaya nawala ung sale with right to repurchase subject to the following conditions
confidence nila on the validity of the instrument) that first, Josie would provide the funds for the repurchase which
amounted to P1.4m and would give Mate P420k as interest for 6
 Petitioner’s defense, invoking Art. 1391 of the Civil
months. Checks were then subsequently issued by Josie with the
Code also cannot stand.
aforesaid amounts.
o The Civil Code provides in Article 1391 that an
When Mate tried to deposit the two checks in his
action to annul a contract on the ground of vitiated
accounts in preparation for the repurchase, the checks were
consent must be filed within four years from the
dishonored for being drawn against a closed account. Realizing
discovery of the vice of consent. In the instant case,
that he was swindled, Mate sent a telegram to Josie and even
however, we are dealing not with a voidable
went to Manila to look for her but to no avail. Mate was then
contract tainted with fraud, mistake, undue
constrained to file a criminal case of estafa against Josie but the
influence, violence or intimidation that can justify
case was archived since Josie could not be found. Mate also filed a
its nullification, but with a contract that is null and
civil case for the reconveyance of the lots he sold under the pacto
void ab initio. (baranda v baranda)
de retro.
Mate v. CA
The RTC and the CA ruled in favor of Tan hence, the petition
GR. 120724-25 May 21, 1998
for review.
Memory Aid:
Issue(s):
BLOCKB2016

Facts:
1. W/N the Deed of Sale with right to purchase was valid.
Josie Rey, along with the private respondent Tan, went
Held:
to the petitioner Mate’s house in Tacloban City. Threatened with
the criminal prosecution of B.P 22 because of the bad checks YES, all the elements of a contract were present and it is
Josie Rey issued to Tan, Josie then sought the help of the valid and binding between the parties. The SC denied Mate’s
petitioner Mate whose wife was her cousin. Josie requested claim that the sale was null and void for lack of consideration
Mate to sell his three lots in Tacloban City with a right to because no money changed hands when he signed the contract.
repurchase. Initially, Mate The Court found that there was indeed consideration in the form
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 44
of the P420k

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 45
SALES DIGESTS BLOCK 2B 2016 BLOCK B
2016
he got for himself for his
accommodati misfortune and
ng Josie’s thus the Court
pleas for can only
help. Other sympathize
than Mate’s
kindness
Josefina, to with him and is
impelledofhis
receipt
P420k
to the
him
execute the constrained to
pacto de rule against
retro. Mate him.
was also Yu Bun Guan
estopped vs Elvira Ong
from assailing G.R. No.
144735.
the nullity of
October 18,
the contract
2001
for lack of
consideration Summary: A
because simulated
when he filed deed of sale
the criminal has no legal
case against effect, and
Josie he the transfer
tacitly certificate of
admitted that title issued in
there was consequence
consideration thereof should
Petitioner be cancelled.
Mate has no Pari delicto
one else to does not
blame but apply to
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 45
simulated sales. Before their separation mispla er’s
in 1992, respondent ced. fraudulen
Facts: executed
simulatedinDeed
property her of Saleaof the J.P. Rizal
husband’s On t acts,
Respondent Elvira Ong favor, but on the promise that he Septe responde
alleges that she and Petitioner Yu would construct a commercial mber nt
Bun Guan are married according to building for the benefit of the 17, executed
Chinese Rites on April 30, 1961. children. The consideration for the 1993, an
‘simulated sale’ was that, after its a new Affidavit
There are two testimonies: execution in which he would owner of
represent himself as single, a ’s Adverse
I) According to respondent:
Deed of Absolute Sale would be copy Claim.
BLOCKB2016

On March 20,1968, with executed in favor of the three (3) of the


title R
her own personal funds, she children and that he would pay
esponde
purchased a parcel of land the Allied Bank, Inc. the loan he was
issued nt claims
referred to as the Rizal property obtained. Petitioner did not
that the
from Aurora Seneris supported by deliver to respondent the 200,000 to
petitio sale be
Title no. 26795 which she peso consideration. Because of
declared
registered on April 17,1968 under the sale, a new title (TCT No. ner.
null and
her own name. 181033) was issued in his name,
L void; for
but to ‘insure’ that he would
ater on, the title
In 1983, using their comply with his commitment, she
failing to be
conjugal fund, petitioner and did not deliver the owner’s copy
to cancelled;
respondent purchased a house of the title to him.
perform payment
and lot registered in their In the meantime,
his of actual,
name under Title No. 118884. Petitioner on the other hand,
promise moral
filed with the RTC, Makati, a
and and
‘Petition for Replacement’ of
gaining exemplar
an owner’s duplicate title.
knowled y
Petitioner falsely made it
ge of damages;
appear that the owner’s copy
petition and
of the title was lost or
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 46
attorney’s fees.

II) On the other hand, Petitioner claims that:

Sometime in 1968 or
before he became a Filipino,
‘through naturalization,’ the JP
Rizal property was being offered
to him for sale. Because he was
not a Filipino, he utilized
respondent as his

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 47
BLOCK
SALES DIGESTS BLOCK 2B 2016 2016 B
‘dummy’ and Believing in
agreed to
have the sale good faith that
executed in his owner’s
the name of
respondent copy of the
although the
consideration
was his own title was lost
and from his
personal and not
funds. knowing that
When the same was
he finally surreptitiously
acquired a ‘concealed’ by
Filipino respondent, he
citizenship in filed in 1993 a
1972, he petition for
purchased replacement of
another the owner’s
property copy of the
being title, in court.
referred to as
Petitio
the ‘Juno lot’
ner added that
out of his
respondent
own funds. If
could not have
only to reflect
purchased the
the true
property
ownership of
because she
the JP Rizal
had no
property, a
financial
Deed of Sale
capacity to do
was then
so; on the
executed in
other hand, he
1972.
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 46
was financially capable although he 1) In Ocejo, Perez & Co. vs. Flores, we ruled consider one of
that a contract of
was disqualified to acquire the purchase and sale is null and null and void and ation for them.
produces no effect
property by reason of his whatsoever where the same is the sale. However,
nationality. Respondent was in pari without cause or consideration this
delicto being privy to the simulated 2) The principle
in that the purchase price
sale. principle does not
which appears thereon as paid
of in pari apply with
has in fact never been paid by
Issue: delicto
the purchaser to vendor. respect to
provides inexistent
1) Is the deed of sale valid? In the present case, it is
that and void
clear from the factual findings of
2) Does Pari delicto apply? when contracts.
BLOCKB2016

both lower courts that the Deed


two ( Modina
of Sale was completely simulated
Held : parties
and, hence, void and without v. Court of
are Appeals)
1) No effect. No portion of the P200,000
equally
consideration stated in the Deed
2) No at fault,
was ever paid. And, from the
the law
facts of the case, it is clear that
Ratio: leaves Vda Catindig v Heirs
neither party had any intention of Catalina Roque
them as
whatsoever to pay that amount. G.R. No. L-25777 J.
they are
and Aquino
Instead, the Deed of Sale
was executed merely to facilitate denies Petitioners: Asuncion
the transfer of the property to recovery Catindig
petitioner pursuant to an by either
Re alina Roque
agreement between the parties
sp SA
to enable him to construct a on
de S
commercial building and to sell
nts
the Juno property to their :
DIG
children. Being merely a He ST
subterfuge, that agreement irs
of BL
cannot be taken as the Cat
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 47
CA’s
price
that finding
notthat
wasstatement the
paid or
er been paid by the BL the the in I
K 2B 2016 purchaser to the vendor. supposed
has OC m
Such a contracts of
in sale is non-existent. It K20B e
fact cannot be considered 16 sale as to the l
nev consummated. The payment of
Summary/mem aid: fishpond, if d
the price is simulated the sale is German Ramirez. The Court of Appeals the price was a
VOID found out that Catindig did not pay simulated,
FACTS: the purchase price because she was fortifies the O
not able to obtain a loan. Hence, CA view that the n
The Heirs of Catalina
said that the sale was VOID because alleged sales g
Roque are co-owners of a
the sale was a simulated one. were void
fishpond, which has an area of
more than 13 hectares. On Oct. R
ISSUE: w/n the sale of the fishpond was
e
BLOCKB2016

1, 1941, the co-owners leased void.


Ong v. Ong s
the fishpond to Catindig for 10
HELD: G.R. No. L-67888 p
years for P6000.
October 8, 1985 J. o
When the lease was terminated, YES. The SC said that the sale Relova n
Catindig was still in possession of the was simulated. According to Art 1471 d
fishpond because she was of the NCC: If the price is simulated, P
e
negotiating with the co-owners for the sale is void, but the act may be e
n
its purchase. She wanted to buy it t
shown to have been in reality a t
for P52000. On Oct. 18, 1960, i
donation, or some other act or s
German Ramirez, one of the co- t
contract. A contract of sale is void
owners, sold his share for P6500. i
and produces no effect whatsoever –
The sale was annotated in the title. o
where the price, which appears
Paolo Villanueva, also one of the n
thereon as paid, A
co-owners, learned of the sale by e
l
German Ramirez. On Nov. 18, 1960, r
f
the rest of the co-owners filed an s
r
action against Catindig to compel e
her to allow them to redeem that -
d
portion of the fishpond sold by o
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 48
the sale is void.
O
n - The execution of a deed
g purporting to convey
ownership of a realty is in
Private Respondents - itself prima facie
Faustino Y Bautista evidence of the existence
and Fernando M. of a valuable
Mangubat consideration, the party
alleging lack of
Memory Aid/Doctrine
consideration has the
- Quitclaim is equivalent to Deed of burden of proving such
Sale allegation

- It is not unusual in
deeds of conveyance
of stating that the
consideration given is
the sum of P1.00,
although the actual
consideration may
have been much more
(Anglo-Saxon
practice). Moreover,
assuming that said
consideration of P1.00
is suspicious, this does
not necessarily mean
the purchase was not
made in good faith
and for valid
consideration and that
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 49
SALES DIGESTS BLOCK 2B 2016 BLOCK B
2016
Facts o CA affirmed and held Quitclaim Deed is a
conveyance of property with a valid cause or
- Imelda Ong for and in consideration of P1.00 and other consideration; the consideration is the P1.00 Peso;
valuable consideration executed a Quitclaim Deed and the apparent inadequacy is of no moment since it
transferred, released, assigned and forever quit claimed to is the usual practice in deeds of conveyance to
Sandra Maruzzo (a MINOR) her heirs and assigns, all her place a nominal amount although there is a more
rights, title, interest and participation in the ONE-HALF valuable consideration given.
undivided portion of the parcel of land
Issue: W/N the Quitclaim Deed (equivalent to a Deed of
- 4 years later, Imelda revoked the Deed of Quitclaim Sale) is void for lack of consideration
- 2 years after the revocation, she DONATED the Held: No. CA ruling affirmed.
WHOLE property to her son
- Quitclaim Deed provides “property was for and in
- Maruzzo’s guardian then filed with RTC action for the consideration of the One (P 1.00) Peso and the other
recovery of ownership of the said lot and the nullification of valuable considerations”
the Deed of Donation
o Thus, the cause or consideration is not the
o In response, Imelda contended the Quitclaim One (P1.00) Peso alone but also the other
Deed is void as it is equivalent to a Deed of valuable considerations.
Donation which requires ACCEPTANCE. As
Maruzzo was a minor, she had no legal o Morales Development Co., Inc. vs. CA: It is not
personality to accept. unusual in deeds of conveyance of stating that the
consideration given is the sum of P1.00, although
o RTC ruled in favor of Maruzzo and said the the actual consideration may have been much
BLOCKB2016

Quitclaim Deed is equivalent to a Deed of Sale. more (Anglo-Saxon practice). Moreover, assuming
- Imelda appealed to the CA that said consideration of P1.00 is suspicious, this
does not necessarily mean the purchase was not
o Imelda added the P1.00 consideration is not a made in good faith and for valid consideration and
consideration at all to sustain the ruling that the that the sale is void. Indeed, bad faith and
Deed of Quitclaim is equivalent to a sale. inadequacy of the monetary consideration do not
render a conveyance inexistent, for the assignor's

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 48
SALES DIGESTS BLOCK 2B 2016 BLOCK B
2016
li o
b r
er
al b
it a
y d
m
a f
y a
b i
e t
s h
u
ffi
m
ci
a
e
y
nt
c
r
a
u e
s n
e d
fo e
r r
a
v e
al i
id
co t
n
t(A
a rt
rcti
cl
e
1
3 h
5
0
Ci
vi
lC ,
o
d
e
,w
h
e
a
sfr
a r) e
u
d
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 49
r rescissible or (Section 5, (r), Rule prepo e
voidable, although 131, Rules of Court). ndera d
valid until annulled, nce of
o It is a legal evide p
a contract
concerning an presumption of nce in u
object certain sufficient cause or a r
entered into with a consideration prope p
cause and with the supporting a contract r o
consent of the even if such cause is action r
contracting parties, not stated therein .(Sama t
nilla
vs,
Cajuc
om,
et al.,
107
(Article 1354, New Phil.
432).
as in the case at bar. i
o T
- Failed to overcome Civil Code) n
h
BLOCKB2016

the burden that g


o This presumption e
consideration is cannot be overcome
presumed: t
by a simple assertion e
o
o Although the cause is of lack of consideration x
not stated in the especially when the e
c
contract it is contract itself states c
o
presumed that it is that consideration was u
n
existing unless the given, and the same t
v
debtor proves the has been reduced into i
e
contrary (Article a public instrument o
y
1354 of the Civil with all due formalities n
Code). and solemnities. To
o
overcome the o
w
o One of the presumption of f
n
disputable consideration the
e
presumptions is alleged lack of a
r
that there is a consideration must be
s
sufficient cause of shown by d
h
the contract e
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 50
ip of a minors is only deeds
realty is in required if it is of sale
itself onerous or were
prima conditional (Article
facie 726, Civil Code)
evidence
of the
existence
Bagnas v. CA
of a
GR L-38498 August 10, 1989
valuable
considerati PETITIONERS: Isaac Bagnas,
on, the Encarnacion Bagnas, Silvestre
party Bagnas Maximina Bagnas, Sixto
alleging Bagnas and Agatona
lack of Encarnacion (first cousins of
considera
Mateum)
tion has
the burden RESPONDENTS: Hon. Court Of
of proving Appeals, Rosa L. Retonil Teofilo
such Encarnacion, and Jose B.
allegation. Nambayan (collateral relatives of
(Caballero, Mateum though more remote in
et al. vs. degree)
Caballero,
et al., (CA), Memory Aid: Petitioners want
45 O.G. to recover land that was
2536). allegedly sold by Mateum, their
deceased relative, to the
- Even assuming the respondents for a consideration
Quitclaim Deed is of P 1.00. The assessed value of
a donation, the property is at least P 10,500.
acceptance by Petitioners alleged that the
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 51
SALES DIGESTS BLOCK 2B 2016
BLOCK B
2016
fictitious, fraudulent, or valid, alternatively, as donations void for aking kapakanan ..." (In English: “the sum of one
want of acceptance embodied in a public instrument. peso, and services rendered, being rendered, and
Respondents denied this, asserting that said sales were made for to be rendered for my seller’s benefit”)
good and valuable consideration - which are services that they
gave to Mateum such as nursing him. Supreme Court said that no o One deed was dated February 6, 1963 and covered
transfer occurred. It was void ab initio because there was no five parcels of land, and the other was dated March
consideration (gross disproportion between the stipulated price 4, 1963, covering five other parcels, both, therefore,
and the assessed value + evidence that there was no real antedating Mateum's death by more than a year.
intention to pay any indicated valuable consideration). Also, Art.
o Petitioners assert that despite said sales,
1458 requires that "equivalent" be something representative of
Mateum continued to be in possession of the
money to the effect that services are not equivalent of money
lands, he remained the owner and that the tax
insofar as said requirement is concerned and that a contract is
payments continued to be paid in his name.
not a true sale where the price consists of services or prestations.
There was also no valid donation because it was not in a public  Petitioners filed in the RTC for the annulment of the deeds
document. of sale as fictitious, fraudulent or falsified, or, alternatively,
as donations void for want of acceptance embodied in a
Facts: public instrument. They claim ownership pro indiviso of the
Hilario Mateum died single, without ascendants or lands subject of the deeds by virtue of being intestate heirs
descendants, and survived only by collateral relatives, of whom of Hilario Mateum.
petitioners were the nearest. He left no will, no debts, and an o Citing Art. 1458 (CC), in prescribing that a sale be
estate consisting of 29 parcels of land in Kawit and Imus, Cavite,
for a ... price certain in money or its equivalent ...
10 of which are involved in this appeal.
requires that "equivalent" be something
BLOCKB2016

 Respondents registered with the Registry of Deeds for representative of money, e.g., a check or draft,
the Province of Cavite two deeds of sale (mostly written citing Manresa to the effect that services are not
in Filipino) purportedly executed by Mateum in their the equivalent of money insofar as said
favor covering ten parcels of land. requirement is concerned and that a contract is
not a true sale where the price consists of services
o Both deeds recited the consideration of the sale or prestations.
to be "... halagang ISANG PISO (Pl.00), salaping
Pilipino, at mga naipaglingkod, ipinaglilingkod sa
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 50
SALES DIGESTS BLOCK 2B 2016
BLOCK B
2016
 Respondent's denied allegations, asserting that said HELD/RATIO: Transfers were void because there was no
sales were made for good and valuable consideration. valid consideration.
They also said that as collateral relatives of Hilario
Mateum , they have done many good things for him,
nursing him, which services constituted the bulk of the
consideration of the sales. And they also set up the
defense that petitioners could not question or seek the
annulment of the sales because they were mere
collateral relatives and were not bound principally or
subsidiarily.

 Trial Court: Granted the motion to dismiss.

o Petitioners are mere collateral relatives and not


forced heirs. They could not legally question the
disposition made by Mateum (as in the case of
Armentia v. Patriarca). Their evidence of alleged
fraud was also insufficient. The fact that the
deeds of sale each a stated a consideration of
only P1.00 was not in itself evidence of fraud or
simulation.

 CA: affirmed.

ISSUE:
BLOCKB2016

Whether, in view of the fact that, for properties with assessed


valuation of more than P10,000.00, the questioned deeds of sale
stating a price of only P1.00 plus unspecified past, present and
future services to which no value is assigned, said deeds were
void or inexistent from the beginning or merely voidable.

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 51
 False and fictitious consideration

o Apparent gross disproportion between the stipulated


price (P 1.00) and the assessed real estate value (at least
P 10,500) plainly and unquestionably demonstrates that
they state a false and fictitious consideration.

 No other true and lawful cause having been


shown, the Court finds both said deeds, insofar
as they purport to be sales, not merely
voidable, but void ab initio.

 Note: the essence of this ruling was that


evidence was adduced to indicate that
there was no real intention to pay any
indicated valuable consideration.

 Manresa citations:

o Services are not the equivalent of money insofar as said


requirement is concerned and that a contract is not a true
sale where the price consists of services or prestations.

o True price, which is essential to the validity of a sale,


means existent, real and effective price, that which
does not consist in an insignificant amount as, say,
P.20 for a house.

 That it is not the same as the concept of a just


price which entails weighing and

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 52
SALES DIGESTS BLOCK 2B 2016
BLOCK B
2016
measuring, for economic equivalence, the - Apostol used company items (logs, steel plates) to pay for
amount of price against all the factors that his personal debt with the Bureau of Prisons
determine the value of the thing sold
Facts:
 But that there is no need of such a close
examination when the immense Republic of the Philippines filed a case against Macario
disproportion between such economic Apostol and Empire Insurance Co. in the CFI. Demand for money
values is patent a case of insignificant or was p34,015.06 with legal interest.
ridiculous price, the unbelievable amount of Macario Apostol won bids with the Bureau of Prisons for
which at once points out its inexistence. 100 tons of Palawan Almaciga and 3M board feet of logs and
contract was executed between Apostol and Bureau of Prisons.
 "Services" mentioned in the questioned
Apostol only paid part of what he owed for the items he won in
deeds of sale are not only vague and
the bid. Empire Insurance Co. was impleaded because it issued a
uncertain, but are unknown and not
performance bond in favor of Apostol.
susceptible of determination without the
necessity of a new agreement between the Phil. Resources Development Corporation filed a petition
parties to said deeds. to intervene in the CFI alleging that Apostol, who was its
President, used materials belonging to the company to pay for
 Not a donation
the debts he owed to Bureau of Prisons. Facts show he incurred
o the law prescribes that donations of immovable such liability in his personal capacity. Phil. Resources alleged that
property, to be valid, must be made and accepted it would lose rights over items it rightfully owned if Court
in a public instrument and it is not denied by the considers such items as payment for Apostol’s debt, when in fact
BLOCKB2016

respondents that there has been no such Phil. Resources has nothing to do with the transaction. Phil.
acceptance which they claim is not required. Resources tried to have goods returned to them, but Bureau of
Prisons did not accede.

CFI denies petition to intervene, however, CA reverses


Republic v Phil. Resources Development decision and orders CFI to allow Phil. Resources to intervene
GR No. L-10141 / 31 January 1958 / J. Padilla because it stands to be adversely affected if such payment using its
goods is validated by the Court as payment of Apostol’s personal
Summary/Memory Aid:
debt. In CA, Republic of the Phils. alleges that since suit is for

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 52
SALES DIGESTS BLOCK 2B 2016 BLOCK B
2016
recovery of "Price . . . is
sum of always paid in
money, and terms of
not the money and the
goods turned supposed
over by
Apostol
previously. payment being
ISSUE/S: in kind, it is no
W/N Phil. payment at all,
"citing Article
Resources 1458 of the
new Civil Code.
should be
However, the
allowed to same Article
provides that
intervene in the purschaser
may pay "a
the case.
price certain in
HELD/RATIO: money or its
equivalent,"
YES. which means
BLOCKB2016

that they
‘We
meant of the
find no
price need not
reason for
be in money.
disturbing
Whether the
the foregoing
G.I. sheets,
pronouncem
black sheets,
ents. The
M. S. Plates,
Government
round bars and
argues that
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 53
G. I. pipes claimed by the Chapter 5: Formation of a Contract p os
respondent corporation to belong
of Sale e ur
to it and delivered to the Bureau of Manila Metal Container t e
Prison by Macario Apostol in Corporation vs Philippine i of
payment of his account is sufficient National Bank t th
payment therefore, is for the court i e
to pass upon and decide after GR no 166862 December 20, 2006 o re
hearing all the parties in the case. Petitioner MMCC; n al
Should the trial court hold that it is est
Intervenor Tolentino;
as to credit Apostol with the value f at
Respondent PNB;
or price of the materials delivered o e
Intervenor DMCI
by him, certainly the herein r m
respondent corporation would be Memory aid: e ort
affected adversely if its claim of x ga
ownership of such sheets, plates, Series of offers t ge
bars and pipes is true.’ and counter r an
a d
offers ;) j so
u ug
Ponente: d ht
Callejo i to
c ha
FACTS: i ve
a th
1. MMCC, to secure a
l e
loan it had obtained
f pr
from PNB, executed
o op
a real estate
r ert
mortgage over a
e y
parcel of land.
c sol
2. In 1982, PNB filed a l d
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 54
at public auction for
P911,532.21, MMCC’s
outstanding obligation
to PNB.

3. The property was sold


at public auction where
PNB was declared the
winning bidder for
P1M. The period to
redeem the property
was to expire on
February 17, 1984.

4. Since petitioner failed


to redeem the
property, a new title
was issued to PNB.

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 55
BLOCK
SALES DIGESTS BLOCK 2B 2016 2016 B
5. Mean of
while,
the accoun
Specia t,
l
Assets MMCC
Mana remitte
geme
nt d
Depar P725,0
tment
(SAM 00.00
D)
had
prepa to PNB
red a
state
ment as
of
accou "deposi
nt,
and
as of t to
June
repurch
25,
1984 ase,"
MMC and an
C's official
obliga receipt
tion was
amou issued
nted
to it.
to
P1,57 6. In the
4,560. mean
47. time,
When the
appris SAMD
ed of reco
the mme
state nded
ment to the

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 54
management of PNB that informed MMCC that the PNB proscribed t
from
MMCC be allowed to Board of Directors had increasing the PN
repurchase the property accepted MMCC’s offer to purchase B
price of the
for P1,574,560.00. purchase the property, but for property. for
However, the PNB P1,931,389.53 in cash less the 10. M "A
management informed P725,000.00 already deposited M nn
MMCC that it is rejecting with it. C ul
its offer and SAMD’s C m
9. MMCC rejected PNB's t en
proposal. It was suggested
proposal. It maintained that h t
that MMCC purchase the
PNB had agreed to sell the e of
property for
property for P1,574,560.47, n M
P2,660,000.00, its
and that since its P725,000.00 fi ort
minimum market value.
downpayment had been l ga
7. MMCC did not agree to accepted, PNB was e ge
PNB's proposal. Instead, it d an
wrote another letter a d
requesting for a c M
reconsideration. PNB o ort
replied in a letter, wherein m ga
it reiterated its proposal p ge
that MMCC purchase the l Fo
property for P2,660,000.00. a re
MMCC declared that it had i clo
already agreed to the n su
SAMD's offer to purchase t re,
the property for a De
BLOCKB2016

P1,574,560.47, and that g liv


was why it had paid a er
i y
P725thou.
n of
8. On June 4, 1985, PNB s
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 55
Title, or Specific contract of sale but merely an BLOCK B
Performance with exchange of offers and There which,
was
Damages." To support counteroffers and that the no however, must
its cause of action for P725thou was a deposit and not a perfe be certain. To
cted
specific performance, it downpayment or earnest money. contr convert the
alleged that there was act of offer into a
CA affirmed the RTC’s sale
already a perfected betw contract, the
contract of sale decision saying that there was no een
the acceptance
between them which meeting of the minds between parties on
June 4, 1985. must be
the PNB refuted. MMCC and PNB hence there was A definite
agreement as absolute and
to the price is
no contract of sale, and as such, an
must not
11. A series of negotiation there was no contract to rescind. essential
qualify the
ensued after the element of a
terms of the
complaint. MMCC binding
offer; it must
offered P3.5M which agreement to
ISSUE: be plain,
PNB rejected asking sell personal
unequivocal,
for its market value of 1. WON MMCC and PNB had or real
unconditional
P30M. MMCC then entered into a perfected contract property.
and without
offered P4.5M which for MMCC to repurchase the When there
variance of any
the PNB again refused. property from PNB? is merely an
sort from the
offer by one
RTC held that there was no HELD: proposal.
party without
S GESTS BLOCK 2B
acceptance A
of the other, qualified
A 2016
there is no acceptance or
L contract. one that
E A involves a new
negotiation is proposal
S formally constitutes a
D initiated by counter-offer
an offer, and a rejection
I
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 56
of the original offer. A counter-offer contract of sale. This contention is likewise to the d in
negated by the
is considered in law, a rejection of stipulation of facts which the parties entered new Lower
into in the trial court:
the original offer and an attempt 9. On June 25, 1984, MMCC paid lowere Calain
to end the negotiation between the P725,000.00 to PNB as deposit to d price. an,
parties on a different basis. The repurchase the property. The Zambo
acceptance must be identical in all deposit of P725,000 was accepted United Muslim and anga
respects with that of the offer so as by PNB on the condition that the Christian Urban City
to produce consent or meeting of purchase price is still subject to the
Poor Association v. and
BRYC covere
the minds. approval of the PNB Board.
G.R. No. 179653 | d by
Unless and until PNB July 31, 2009 |
The statement of account Transf
accepted the offer on these Ponente: NACHURA,
prepared by the SAMD cannot be er
terms, no perfected contract of J.
considered an unqualified Certifi
sale would arise. Absent proof of
acceptance to MMCC's offer to FACTS: cate of
the concurrence of all the
purchase the property. The Title
essential elements of a contract
statement is but a computation of R (TCT)
of sale, the giving of earnest
the amount which MMCC was espon No.
money cannot establish the
obliged to pay in case respondent dent 3182
existence of a perfected contract (T-
would later agree to sell the Sea
BLOCKB2016

of sale. 576).
property. Foods
It appears that, per its Corpor
There is no evidence that S
letter to MMCC dated June 4, ation
the SAMD was authorized by PNB's ometime
1985, the PNB had decided to (SFC)
Board of Directors to accept in 1991,
accept the offer to purchase the is the
MMCC's offer and sell the property. petitione
property. However, this registe
Any acceptance by the SAMD of r United
amounted to an amendment of red
MMCC's offer would not bind PNB. Muslim
PNB's qualified acceptance, or an owner
and
The P725,000.00 it had amended counter-offer, because of Lot
Christian
remitted to PNB was "earnest while the PNB lowered the No.
Urban
money" which could be considered purchase price, it still declared 300
Poor
as proof of the perfection of a that its acceptance was subject locate
Associati
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 57
on, Inc. (UMCUPAI), an
organization of

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 58
BLOCK
SALES DIGESTS BLOCK 2B 2016 2016 B
squatters Letter of
occupying Lot
No. 300, Intent to
through its Purchase by
President,
Carmen T. UMCUPAI.
Diola,
initiated However,
negotiations
with SFC for
the purchase the intended
thereof.
UMCUPAI sale was
expressed derailed due to
its intention UMCUPAI’s
to buy the inability to
subject secure the loan
property from NHMF as
using the not all its
proceeds of members
its pending occupying Lot
loan No. 300 were
application willing to join
with the
National undertaking.
Home Intent on
Mortgage buying the
Finance subject
Corporation property,
(NHMF). UMCUPAI, in a
Thereafter, series of
the parties conferences
executed a with SFC,
Letter of proposed the
Intent to Sell subdivision of
by [SFC] and Lot No. 300 to
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 56
allow the squatter-occupants to Lot No. 300-C, and the a
cancellation of TCT No.
purchase a smaller portion thereof. T-121,523. UMCUPAI prior,
alleged that the sale
between the better,
respondents violated
Consequently, sometime in its valid and and
December 1994, Lot No. 300 was subsi
preferr
subdivided into three (3) parts sting
ed
covered by separate titles. On agre
right
January 11, 1995, UMCUPAI eme
over
purchased Lot No. 300-A. In turn, nt
BRYC
Lot No. 300-B was constituted as with
in the
road right of way and donated by SFC
purcha
SFC to the local government. emb
se of
odie
UMCUPAI failed to acquire Lot
d in
Lot No. 300-C for lack of funds. On No.
the
BLOCKB2016

March 5, 1995, UMCUPAI 300-C.


Lette
negotiated anew with SFC and was r of I
given by the latter another three Inten n
months to purchase Lot No. 300-C. t. refutatio
However, despite the extension, the Acco n, BRYC
three-month period lapsed with the rding said that
sale not consummated because to UMCUPA
UMCUPAI still failed to obtain a UMC I’s
loan from NHMF. Thus, on July 20, UPAI, complain
1995, SFC sold Lot No. the t did not
300-C to respondent BRYC-V Lette state a
Development Corporation (BRYC). r of cause of
Inten action
A year later, UMCUPAI since
t
filed with the RTC a complaint UMCUPA
grant
against respondents SFC and I had
ed it
BRYC seeking to annul the sale of unequivo
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 57
cally recognized its ownership Letter of Intent dated October 4, BLOCK B
of Lot No. 300-C when 1991 was subject to a condition that the ION OF
Letter of
UMCUPAI likewise sent BRYC a i.e., payment of the acquisition Intent was ARTICLE 1479,
Letter of Intent dated August price, which UMCUPAI failed to neither a FIRST
promise, nor
18, 1995 imploring BRYC to re- do when it did not obtain the an option PARAGRAPH,
contract, nor
sell the subject lot. loan from NHMF. an offer CIVIL CODE OF
contemplated
under Article THE
1319 of the
In a separate Answer, Civil
Code, or a PHILIPPINES?
SFC countered that the Letter
After trial, the RTC bilateral
of Intent dated October 4, HELD/RATIO:
dismissed UMCUPAI’s complaint. contract to
1991 is not, and cannot be
The lower court found that the sell and buy. Althou
considered, a valid and
Letter of Intent was executed to The CA, on gh not stated
subsisting contract of sale. On
facilitate the approval of appeal, plainly,
the contrary, SFC averred
UMCUPAI’s loan from NHMF for affirmed in UMCUPAI
that the document was drawn
its intended purchase of Lot No. toto the claims that the
and executed merely to
300. According to the RTC, the RTC’s ruling. Letter of Intent
accommodate UMCUPAI and
Letter of Intent was simply SFC’s ISSUE: is equivalent to
enable it to comply with the
declaration of intention to sell, a conditional
loan documentation
and not a promise to sell, the 1. IS THE contract of sale
requirements of NHMF. In all, LETTER OF
subject lot. On the whole, the RTC subject only to
SFC maintained that the INTENT TO
concluded the suspensive
SELL AND condition of
S GESTS BLOCK 2B OF
LETTER payment of the
A 2016 INTENT TO purchase price.
BUY A
L BILATERAL A
E RECIPROCAL contract to sell
CONTRACT is a bilateral
S
WITHIN THE contract
D MEANING OR whereby the
I CONTEMPLAT prospective
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 58
seller, while expressly reserving the In the instant case, mere do (Article
however, the parties
ownership of the subject property executed a Letter idea, 1156, Civil
of Intent, which is neither a contract to sell
despite delivery thereof to the nor a conditional goal, or Code).
prospective buyer, binds himself to contract of sale. As found by plan. It One
sell the said property exclusively to the RTC, and upheld by the simply cannot be
the prospective buyer upon CA, the Letter of Intent was signifies bound by
fulfillment of the condition agreed executed to accommodate a course what he
upon, that is, full payment of the UMCUPAI and facilitate its of action proposes
purchase price. loan application with NHMF. that one or plans
BLOCKB2016

Nowhere in the Letter of proposes to do or


In a contract to sell, upon Intent does it state that SFC to accomplis
the fulfillment of the suspensive relinquishes its title over the follow. It h. A Letter
condition which is the full payment subject property, subject only to simply of Intent is
of the purchase price, ownership the condition of complete indicates not a
will not automatically transfer to payment of the purchase price; what contract
the buyer although the property nor, at the least, that SFC, one between
may have been previously delivered although expressly retaining proposes the parties
to him. The prospective seller still ownership thereof, binds itself to to do or thereto
has to convey title to the sell the property exclusively to accompli because it
prospective buyer by entering into UMCUPAI. The Letter of Intent to sh. A does not
a contract of absolute sale. Buy and Sell is just that – a mere bind one
manifestation of SFC’s intention “intentio party,
to sell the property and n” with
UMCUPAI’s intention to acquire cannot respect to
the same. give rise the other,
to an to give
In their Agreement, SFC
obligatio something
expressly declared its “intention”
n to , or to
to sell and UMCUPAI expressly
give, to render
declared its “intention” to buy
do or some
subject property. An intention is a
not to service
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 59
(Art. 1305, Civil Code).

The Letter of
Intent/Agreement between
SFC and UMCUPAI is
merely a written
preliminary understanding
of the parties wherein they
declared their intention to
enter into a contract of
sale. It is subject to the
condition that UMCUPAI
will

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 60
BLOCK
SALES DIGESTS BLOCK 2B 2016 2016 B
“apply with merely a
the Home
Mortgage and declaration of
Finance SFC’s intention
Corporation
for a loan to enter into a
to pay the
acquisition contract.
price of said
land.” One of
the UMCUPAI’s
requirements
for such declaration of
loan is “a intention to
formal buy is also not
manifestatio certain and
n of Intent definite as it is
to Sell” subject to the
from SFC. condition that
Thus, the UMCUPAI
Letter of shall endeavor
Intent to to raise funds
Sell fell to acquire
short of an subject land.
“offer” The
contemplat acceptance of
ed in Article the offer must
1319 of the be absolute; it
Civil Code must be plain
because it is and
not a unconditional.
certain and Moreover, the
definite Letter of
proposal to Intent/Agreem
make a ent does not
contract but contain a
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 58
promise or commitment to enter Intent/Agreement be considered a Article 1479 of the I could
Civil Code which is
into a contract of sale as it merely bilateral reciprocal contract to sell reciprocally raise the
declared the intention of the and to buy contemplated under demandable. The necessary
Letter of
Intent/Agreement
parties to enter into a contract of does not contain a funds to
PROMISE to sell and
sale upon fulfillment of a condition to buy acquire
that UMCUPAI could secure a loan subject the same.
to pay for the price of a land. property Carceller v. Court of
The Letter of . There Appeals
Intent/Agreement is not an “option was no G
contract” because aside from the promise
fact that it is merely a declaration or R
of intention to sell and to buy commit
BLOCKB2016

subject to the condition that ment on


UMCUPAI shall raise the necessary the part N
funds to pay the price of the land, of SFC to
o
and does not contain a binding sell
promise to sell and buy, it is not subject .
supported by a distinct land to
consideration distinct from the price UMCUPA
of the land intended to be sold and I, but
1
to be bought. No option was merely a
granted to UMCUPAI under the declarati 2
Letter of Intent/Agreement to buy on of its
subject land to the exclusion of all intention 4
others within a fixed period nor to buy
7
was SFC bound under said the land,
Agreement to Sell exclusively to subject 9
UMCUPAI only the said land within to the
the fixed period. condition 1
that
Neither can the Letter of UMCUPA
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 59
F u includin 30, 1986.
g all the The lease
e is improve contract
b u ments also states
thereon. that the
r m Petition option to
er and purchase
u b
SIHI shall be
a i entered exercised
into a by written
r n lease notice to
contract the lessor
y g,
with (SIHI) at
J. option anytime
to within the
1 Petitioners: Jose Ramon Carceller purchas option
e over period
0 Respondents: Court of Appeals
said two and the
and State Investment Houses,
, parcels document
Inc. (SIHI)
of land, of sale has
Memory Aid: lease contract with for 18 to be
option to purchase, 6-month months consumm
1
extension to exercise option, SIHI at a rate ated
9 with financial problems, Carceller’s of within the
improvements on the land, P10k/m month
9 onth, immediat
obtained a loan
from ely
9
Facts: Aug 1 following
1984 the month
SIHI is the registered
until when the
Q owner of 2 parcels of land
January lessee
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 60
exercised his option under the contract. BLOCK B
On 1. W/N Carceller
S 16 Jan should be allowed
7, to exercise the
A 198 option to
purchase the leased
6 or property despite the
L 3 alleged delay in giving
the
wee required notice to
E ks
SIHI
befo
S re
expi
D ratio
n of
the
I leas
e
G contract,
SIHI notified
Carceller of
the
E termination
of the lease
S agreement
and the time
T left to
exercise the
S option to
B purchase.
In a alleging Held:
L
letter dated that he
O Jan 15, which needs time
C was received to raise
by SIHI on funds.
K Jan 29,
2 Carceller
B requested for
a 6-month
2 extension of
0 the lease
contract,
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 61
YES. Carceller’s letter dated Jan 15 was fair request for the given and
extension of the
notice of his lease contract for 6 the known
months to
deed of sale in favor of Carceller CA: intent of
On Feb 14, SIHI told allow him to
generate funds to the parties
Carceller that his request was Affirmed RTC’s decision
exercise the option to the
disapproved, but SIHI offered to
Issue: to buy. agreemen
lease the property to Carceller at a
t.
rate of P30k/month for a period of 1 T
year. SIHI also told Carceller that it he SC Th
decided to offer for sale the subject ruled e SC took
property to the public. that into
Carcelle account
On Feb 18, Carceller
r’s letter the
notified SIHI of his decision to
of Jan primary
exercise the option to purchase
15 and intent of
and made arrangements for the
his the parties
payment of downpayment
formal in entering
thereon.
exercise into the
On Feb 20, SIHI sent a of the lease
letter to Carceller stating that the option contract
period within which the option on Feb with
period should have been 18 were option to
exercised had already lapsed and within a purchase,
asked Carceller to vacate the reasona as well as
property within 10 days. ble their
time- subsequen
Carceller filed a complaint for frame t and
BLOCKB2016

specific performance and consiste contempo


damages with the RTC to compel nt with raneous
SIHI to execute the deed of sale.
the acts. SIHI,
RTC: Ordered SIHI to execute a periods prior to its

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 62
negotiation with Carceller, option to buy within the period
was already beset with agreed upon, the lessee
financial problems. SIHI was
compelled to dispose some of
its assets to generate
sufficient funds. SIHI’s
agreement to enter first into
a lease contract with option to
purchase is clear proof its
intent to promptly dispose of
the property. Its letter dated
Jan 7 reminding Carceller of
the time left to exercise the
option to buy, as well as the
letter informing Carceller of
the decision to sell the
property to the general public,
clearly showed its desire to
sell the property.
Carceller manifested his
determination to buy the
property. He introduced
permanent improvements
on it and secured an P8M
loan to increase his
chances of acquiring the
property.

The SC cited a case


wherein it ruled that if a
lessee fails to exercise his

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 63
SALES DIGESTS BLOCK 2B 2016
BLOCK B
2016
loses the right to buy the property later on based on the same farmers
terms and conditions SET IN THE OFFER. Carceller could not,
therefore, insist on buying the property based on the price
agreed upon in the lease agreement. SIHI, on the other hand,
could not take advantage of the situation to increase the selling
price of the said property by nearly 90% because such leap in
the price quoted would show an opportunistic intent to exploit
as SIHI knew that Carceller needed the property for his business
and he could afford to pay such higher price since Carceller was
able to obtain an P8M loan. If the Courts were to allow SIHI to
take advantage of the situation, there would be an injustice to
Carceller because SIHI would be unjustly enriched at Carceller’s
expense.

NOTE: Option is defined as a preparatory contract in which one


party grants to the other, for a fixed period and under
specified conditions, the power to decide, whether or not to
enter into a principal contract. It is a separate agreement
distinct from the contract which the parties may enter into
upon consummation of the option.

Tayag vs Lacson
BLOCKB2016

GR No. 134971 March 25, 2004

Petitioner: Herminio Tayag

Respondents: Amancia, Rosendo, Antonio, Juan (all


surnamed Lacson), Teodisia Lacson-Espinosa, CA

Additional characters: Tiamson et. al = tenants/tillers/group of

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 60
Memory Aid: Famers/tenants; deeds of assignments; option
contracts

Facts:

 The respondents are the registered owners of three


parcels of land located in Mabalacat, Pampanga. The
properties are tenanted agricultural lands.

 A group of farmers, Julio Tiamson et. al, individually


executed a deed of assignment transferring their
respective rights as tenants/tillers of the landholdings
possessed in consideration of P50.00 per m2 to Herminio
Tayag.

 Said amount was made payable when legal impediments to


the sale of the property no longer existed.

 Exclusive right to buy the property was granted if the


Lacsons agreed to sell the property with the concurrence
of the tenants.

 Tayag gave varied sums of money to Tiamson et. al as


partial payments and received in return receipts.

 Tayag wrote Tiamson et. al invited them for a meeting


regarding the negotiations/implementations of the terms of
deeds of assignments.

 Thereafter, Tiamson et. al replied through a letter that


they decided to sell all their rights and interest to the
Lacsons.

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 61
SALES DIGESTS BLOCK 2B 2016
BLOCK B
2016
 The petitioner filed a complaint against Tiamson et. al and much less the “exclusive right to buy” the property.
the Lacsons before the RTC for the court to fix the period Nemo dat quod non habet.
within which to pay the purchase price.
 An option is a contract by which the owner of the
 One of the arguments of the petitioner is that deed of property agrees with another person that he shall have
assignment executed by Tiamson et. al are perfected the right to buy his property at a fixed price within a
option contracts. certain time, or under, in compliance with certain terms
and conditions, or which gives to the owner of the
Issues:
property the right to sell or demand a sale.
1) WON the respondents agreed to sell the property
 Imposes no binding obligation on the person holding
2) WON there were perfected option contracts an option aside from the consideration of the offer.

Held:  The second party gets in praesenti, not lands, not an


agreement that he shall have the lands but the right to
1. NO. call for and receive lands if he elects.

No showing that they agreed to sell the property.  An option contract is separate and distinct contract
from which the parties may enter into upon the
1. Tayag and Tiamson et. al have yet to submit
conjunction of the option.
deeds of assignment to DAR, which can approve
or disapprove the same.

2. Tayag even alleged that he was yet to Sanchez v. Rigos


BLOCKB2016

meet Tiamson et. al. No. L-25494 June 14,1972

2. NO. C.J. Concepcion

Tiamson et. al are were merely tenants and not the registered Petitoner: Nicolas Sanchez
owners of the property.
(buyer) Respondent: Severina
3. Not being the owners of the property, the tenants
could not legally grant the petitioner the option, Rigos (seller) Memory Aid:

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 61
“Option to Purchase”

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 62
SALES DIGESTS BLOCK 2B 2016 BLOCK B
2016
Doctrine: Art. withdrawal, it
1479 - An is equivalent
accepted to an offer
unilateral being
promise to accepted
buy
a or to sell
determinate giving rise to a
thing
price for a
certain
is binding
upon the
promissor
if the valid and
promise is binding sale.
supported by
a FACTS:
consideration
distinct from Nicolas
the price. Sanchez and
Without a Severina Rigos
consideration executed an
separate from instrument
the purchase entitled
price, an “Option to
option Purchase,"
contract whereby Mrs.
would be Rigos “agreed,
void, as a promised and
contract, but committed …
would still to sell" to
Sanchez, for P
constitute a 1,510.00, a
valid offer; parcel of land
so that if the in Nueva Ecija
option is within two (2)
exercised year. Such
prior to its option shall be
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 62
deemed “terminated and 1. Was there a contract to buy and sell to sell, C
elapsed," if “Sanchez shall fail to between the
a unilateral partiestoorsell?
promise only which, if E
exercise his right to buy the HELD/RATIO: accepted, L
property" within the stipulated results in I
The instrument was a
period. Since the several tenders of a N
mere unilateral promise to sell. It
payment of Sanchez were rejected perfected O
was not reciprocally demandable
by Rigos, Sanchez just deposited contract
because although Rigos “agreed,
the amount with the CFI of Nueva of sale. D
promise and committed” herself
Ecija and filed an action for I
to sell the land, Sanchez has NOT SC affirmed the lower
specific performance and A
“agreed and committed himself” court’s decision
damages. M
to buy. As indicated by its own
title, it was a mere "Option to A
Rigos contended that the contract
Purchase," so Sanchez had no N
BLOCKB2016

between the parties “is a unilateral Diamante v. CA


obligation to purchase the T
promise to sell, and the same being G.R. No. L-51824
property. Although the sum of P1, E
unsupported by any valuable
consideration, is null and void." 510 was expressly stipulated, P
there is nothing in the contract to R
Still, the lower court rendered e
indicate that the promise and e
judgment in favor of Sanchez and t
undertaking is supported by a s
ordered Rigos to accept the sum i
consideration "distinct from the p
Sanchez judicially consigned, and to t
price" as required by Art. 1479. o
execute in his favor the requisite i
n
deed of conveyance. o
In an accepted promise to d
n
ISSUE: sell, since there may be no valid e
e
contract without a cause or n
r
consideration, the promisor is not t
:
bound by his promise and may, s
accordingly, withdraw it. Pending :
P
notice of its withdrawal, his
E
accepted promise partakes, C
R
however, of the nature of an offer
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 63
A and
GERARDO
DEYPALU
BUS

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 64
SALES DIGESTS BLOCK 2B 2016 BLOCK B
2016
Summary / promise to sell,
Memory which is a mere
Aid:“Option offer. For it to
to be binding on
Repurchase”, both parties, it
Fishpond
License/Leas
e Agreement, must be shown
DANR
Secretary,
Bureau
Fishery of
The that the there
effects of a is acceptance
right of and that there
repurchase is a
contained in consideration
the original distinct from
document of the price. In
sale and an this case, with
option to regard to the
repurchase document
subsequent entitled
and separate “OPTION TO
from the REPURCHASE”
original executed by
document of the parties over
sale differ. the property in
The latter is a controversy, it
separate was not
contract from conclusively
the contract shown that
of sale; it is there was
merely a acceptance and
unilateral a separate
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 63
consideration; thus it was not because of dire financial - After several e
bonding at all. In conclusion, this need. days,
“OPTION TO REPURCHASE” cannot Deypalubus p
be asserted by the petitioner as a executed in r
ground for the revocation of the favor of the
petitioner
Diamante o
another
document
entitled:
“Option
respondent’s Fishpond License / t p
Lease Agreement over the subject o e
property. r
R t
The Facts:
e y
- A fishery lot (with an area p
of 9.4 hectares and u i
covered by Fishpond r n
BLOCKB2016

Permit No. F-2021) was in c


the name of Dionio. Upon h q
Diono’s death, her heirs, a u
petitioner Diamante and s e
Dafeliz, inherited the e s
property which they ” t
divided among , i
themselves. The o
petitioner Diamante’s w n
share of the fishery lot is h
the subject of this case. e c
r a
- In 1960, petitioner, as n
e
evidenced by a deed of
i
sale, sold all his remaining b
n
rights over his portion of e
the fishery lot to the
t
private respondent r
h
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 64
epurchased by the Agreement, private - T t
petitioner within 10 respondent submitted h i
years from said to the Bureau of i o
date, with a 10 Fisheries (BOF) the s n
grace period. deed of sale of his e
 VERY transaction with r r
IMPT. petitioner. But he did e
FACT: not include the “Option q t
This to Repurchase” in his u h
option application. e e
s n
to
- Eventually, the BOF t
repurch
issued in favor of private s
ase was
respondent a Fishpond w o
a
Permit and a Fishpond a u
separat
Lease Agreement s g
e
(Fishpond Permit No. h
agreem
4953-Q and FLA No. d t
ent
1372, respectively). i
from s a
the - In December 1963, m
contrac petitioner requested the i r
t of BOF to nullify the FLA s e
sale of granted to respondent s c
the because the former is e o
subject entitled to a valid d n
fishery twenty-year option to . s
lot. repurchase (in i
accordance with the P d
- In applying for a
“Option to Repurchase” e e
Fishpond Permit and
they executed). t r
a Fishpond Lease
i a
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 65
tion of the
dismissal which
was denied.

- Petitioner sought
again for a
reconsideration with
the DANR Secretary.
This time, he was
successful. The DANR
Secretary

Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 66
SALES DIGESTS BLOCK 2B 2016 BLOCK B
2016
grant cation
ed his for the
motio permit
n in and
an the
Order lease
cancel agree
ling ment
FLA when
No. the
1372.
The
Secret “Optio
ary
stated
that
there
was
n of a
misre
prese
ntatio
an n to
essen Repurc
tial hase”
or was
mate not
rial submi
fact tted.
com o
mitte
B
d by
a
the
s
respo
e
ndent
d
Deyp
hi
alubo
s
s in
r
his
ul
appli
in
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 64
g on Section 20 of forged, and thus, the discretion was re.
Fisheries Admin. Secretary of DANR committed by the
Order No. 60: any shouldn’t have relied respondent inv
false statements, on such document in Secretary
inasmuch ali
was given as
private
respondent
ample
or any alteration, junking his Fishpond o dit
change or Permit/Lease p y
BLOCKB2016

modification of any Agreement. p of


or all terms and o th
conditions made in - The CFI decided in favor of the
rt e
the application private respondent, stating
u “O
shall cause the that: (1) the DANR Secretary
n pti
cancellation of the abused his discretion and (2)
it on
permit or lease. petitioner cannot repurchase
y to
the fishpond as the “Option
- Because of the Secretary’s to Repurchase” is of doubtful t Re
denial of his appeal, o pu
validity.
private respondent filed b rch
with the CFI of Iloilo - Petitioner appealed to the e as
seeking to annul the CA. It reversed the decision h e”.
Secretary's order on the of the trial court on the e - Su
ground that the Secretary ground that no grave a bs
gravely abused his abuse of r eq
discretion in not giving d ue
him the opportunity to o ntl
prove that the “Option to n y,
Repurchase” was forged. h ac
is tin
o Basically,
cl g
Deypalubus was
ai on
asserting that the
m the
“Option to
Mo
Repurchase” was
tio
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 65
n of Reconsideration that the findings of fact of
filed by respondent, the administrative bodies
CA reversed its own should be accorded
decision and affirmed respect, absent a showing
the previous CFI ruling. of arbitrariness.

o The CA’s The Issue:


reasoning: The
DANR Secretary 1. W/N the decision of the
had gone DANR Secretary (which in
beyond his essence recognized the
statutory “Option of Repurchase”
authority and and thus revoked the
had clearly respondent’s fishpond
acted in abuse license) should be set
of discretion in aside?
giving due
Held / Ratio:
weight to the
“Option to YES, THE DECISION OF THE
Repurchase” SECRETARY SHOULD BE SET
whose ASIDE AND THUS, THE
genuineness FISHPOND LICENSE/LEASE
and due AGREEMENT OF RESPONDENT
execution had SHOULD BE REINSTATED.
been
successfully
impugned and
denied by
Deypalubus.

- Petitioner Diamante
goes to the SC: contends
Altavas, Arandia, Avila, Bautista, Bantug, Camacho, Catacutan-Estabillo, Cayetano, Cocabo Cusipag, Dantes, Dilangalen, Diego, Elamparo, Flores, Galang, Garcia, Geraldez,
Guiyab, Henares, Hizon, Lee, Manalo, Matias, Mendoza, Morales, Ong, Santos, Sarmiento, Yap 66
BLOCK
SALES DIGESTS BLOCK 2B 2016 2016 B
1. The that
Secret
ary the
did respo
not
gravel ndent
y Secre
abuse
of tary
discre gravel
tion in