Assign No. 1 Full Cases

7/25/2019 Assign No. 1 Full Cases

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G.R. No. 166714 February 9, 2007

AMELIA S. ROBERTS, Petitioner,vs.MARTIN B. PAPIO,Respondent.

D E C I S I O N

ALLE!O, SR., J.:

Assailed in this petition for review on certiorari is the Decision1of the Court of Appeals CA!, in CA"#.R. C$ No. %&'() which reversed and set aside the Decision*of the Re+ional rial Court RC!,-ranch 1', /a0ati Cit, in Civil Case No. '1")(1. he RC rulin+ had affir2ed with 2odification theDecision(of the /etropolitan rial Court /eC!, -ranch %), /a0ati Cit in Civil Case No. %%3)4.he petition li0ewise assails the Resolution of the CA denin+ the 2otion for reconsideration of itsdecision.

he Antecedents

he spouses /artin and 5ucina Papio were the owners of a *4)"s6uare"2eter residential lot locatedin /a0ati now /a0ati Cit! and covered 7 ransfer Certificate of itle C! No. S"))&3'.)In orderto secure a P&,'''.'' loan fro2 the A2paro Invest2ents Corporation, the e8ecuted a real estate2ort+a+e on the propert. 9pon Papio:s failure to pa the loan, the corporation filed a petition for thee8tra;udicial foreclosure of the 2ort+a+e.

Since the couple needed 2one to redee2 the propert and to prevent the foreclosure of the realestate 2ort+a+e, the e8ecuted a Deed of A7solute Sale over the propert on April 1(, 1&3* in favorof /artin Papio:s cousin, A2elia Ro7erts. Of the P3,'''.'' purchase price, P&,'''.'' was paid tothe A2paro Invest2ents Corporation, while the P*%,'''.'' difference was retained 7 the spouses.

As soon as the spouses had settled their o7li+ation, the corporation returned the owner:s duplicateof C No. S"))&3', which was then delivered to A2elia Ro7erts.

hereafter, the parties A2elia Ro7erts as lessor and /artin Papio as lessee! e8ecuted a two"earcontract of lease dated April 1, 1&3*, effective /a 1, 1&3*. he contract was su7;ect to renewal ore8tension for a li0e period at the option of the lessor, the lessee waivin+ there7 the 7enefits of ani2plied new lease. he lessee was o7li+ed to pa 2onthl rentals of P3''.'' to 7e deposited in thelessor:s account at the -an0 of A2erica, /a0ati Cit 7ranch.%

On


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de2andin+, for the last ti2e, that he and his fa2il vacate the propert.1'A+ain, Papio refused toleave the pre2ises.

On


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Papio appended to his Answer the followin+? 1! the letter dated 7! the letter of Eu+ene Ro7erts plaintiff:s hus7and! to Perlita $entura dated *1

and c! plaintiff:s letter to defendant Papio dated


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third, the defense of ownership over the propert was raised onl after Ro7erts de2anded hi2 tovacate the propert.

-ased solel on the parties: pleadin+s, the /eC rendered its

*. Pa plaintiff the reasona7le rentals accrual for the period and

). Pa the costs

SO ORDERED.(1

he /eC held that Ro7erts 2erel tolerated the sta of Papio in the propert after the e8piration ofthe contract of lease on /a 1, 1&3)> hence, she had a cause of action a+ainst hi2 since the onlele2ents in an unlawful detainer action are the fact of lease and the e8piration of its ter2. hedefendant as tenant cannot controvert the title of the plaintiff or assert an ri+ht adverse thereto orset up an inconsistent ri+ht to chan+e the e8istin+ relation 7etween the2. he plaintiff need notprove her ownership over the propert inas2uch as evidence of ownership can 7e ad2itted onl forthe purpose of deter2inin+ the character and e8tent of possession, and the a2ount of da2a+esarisin+ fro2 the detention.

he court further ruled that Papio 2ade no denials as to the e8istence and authenticit of Ro7erts:title to the propert. It declared that the certificate of title is indefeasi7le in favor of the person whosena2e appears therein and incontroverti7le upon the e8piration of the one"ear period fro2 the dateof issue, and that a orrens title, which en;os a stron+ presu2ption of re+ularit and validit, is+enerall a conclusive evidence of ownership of the land referred to therein.

As to Papio:s clai2 that the transfer of the propert was one with ri+ht of repurchase, the /eC heldit to 7e 7ereft of 2erit since the Deed of Sale is ter2ed as a7solute and unconditional. he courtruled that the ri+ht to repurchase is not a ri+ht +ranted to the seller 7 the 7uer in a su7se6uentinstru2ent 7ut rather, a ri+ht reserved in the sa2e contract of sale. Once the deed of a7solute saleis e8ecuted, the seller can no lon+er reserve the ri+ht to repurchase> an ri+ht thereafter +ranted in aseparate docu2ent cannot 7e a ri+ht of repurchase 7ut so2e other ri+ht.

As to the receipts of pa2ent si+ned 7 $entura, the court +ave credence to Ro7erts:s declaration inher Affidavit that she authori@ed $entura onl to collect rentals fro2 Papio, and not to receive therepurchase price. Papio:s letter of


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I.

=E 5OER CO9R #RA$E5F ERRED IN NO DIS/ISSIN# =E CASE OR E


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-ein+ in accordance with law and the circu2stances attendant to the instant case, the court finds2erit in plaintiff"appellee:s clai2. herefore, the challen+ed decision dated


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Ro7erts filed a 2otion for reconsideration of the decision on the followin+ +rounds?

I. Petitioner did not alle+e in his Answer the defense of e6uita7le 2ort+a+e> hence,the lower courts shouldJ not have discussed the sa2e>

II. Even assu2in+ that Petitioner alle+ed the defense of e6uita7le 2ort+a+e, the

/eC could not have ruled upon the said defense,

III. he /eJC and the RC were not re2iss in the e8ercise of their ;urisdiction.))

he CA denied the 2otion.

In this petition for review, A2elia Salvador"Ro7erts, as petitioner, avers that?

I. =E =ONORA-5E CO9R O APPEA5S #RIE$EO9S5F SIC! ERRED INDEC5ARIN# =A =E /eJC AND! =E RC ERE RE/ISS IN =EEHERCISE O =A 7such representation, he had i2pliedl ad2itted the e8istence and validit of the deed of a7solutesale where7 ownership of the propert was transferred to petitioner 7ut reverted to hi2 upon thee8ercise of said ri+ht. he respondent even filed a co2plaint for specific perfor2ance with da2a+es,which is now pendin+ in the RC of /a0ati Cit, doc0eted as Civil Case No. '1"31 entitled"MartinB. Papio vs. Amelia Salvador-Roberts."In that case, respondent clai2ed that his transaction with the

petitioner was a sale withpacto de retro. Petitioner posits that Article 1%'* of the Civil Code appliesonl when the defendant specificall alle+es this defense. Conse6uentl, the appellate court wasproscri7ed fro2 findin+ that petitioner and respondent had entered into an e6uita7le 2ort+a+e underthe deed of a7solute sale.

Petitioner further avers that respondent was a7l represented 7 counsel and was aware of thedifference 7etween a pacto de retro sale and an e6uita7le 2ort+a+e> thus, he could not have 7een2ista0en in declarin+ that he repurchased the propert fro2 her.

As to whether a sale is in fact an e6uita7le 2ort+a+e, petitioner clai2s that the issue should 7eproperl addressed and resolved 7 the RC in an action to enforce ownership, not in an e;ect2entcase 7efore the /eC where the 2ain issue involved is possession de facto. Accordin+ to her, the

o7vious i2port of the CA Decision is that, in resolvin+ an e;ect2ent case, the lower court 2ust passupon the issue of ownership in this case, 7 applin+ the presu2ptions under Art. 1%'*! which, ineffect, would use the sa2e ardstic0 as thou+h it is the 2ain action. he procedure will not onlpro2ote 2ultiplicit of suits 7ut also place the new owner in the a7surd position of havin+ to firstsee0 the declaration of ownership 7efore filin+ an e;ect2ent suit.

Respondent counters that the defense of e6uita7le 2ort+a+e need not 7e particularl stated toapprise petitioner of the nature and character of the repurchase a+ree2ent. =e contends that he hada2pl discussed in his pleadin+s 7efore the trial and appellate courts all the surroundin+
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circu2stances of the case, such as the relative situation of the parties at the ti2e> their attitude, acts,conduct, and declarations> and the ne+otiations 7etween the2 that led to the repurchase a+ree2ent.hus, he ar+ues that the CA correctl ruled that the contract was one of e6uita7le 2ort+a+e. =einsists that petitioner allowed hi2 to redee2 and reac6uire the propert, and accepted his fullpa2ent of the propert throu+h $entura, the authori@ed representative, as shown 7 the si+nedreceipts.

he threshold issues are the followin+? 1! whether the /eC had ;urisdiction in an action forunlawful detainer to resolve the issue of who 7etween petitioner and respondent is the owner of thepropert and entitled to the de facto possession thereof> *! whether the transaction entered into7etween the parties under the Deed of A7solute Sale and the Contract of 5ease is an e6uita7le2ort+a+e over the propert> and (! whether the petitioner is entitled to the 2aterial or de factopossession of the propert.

he Rulin+ of the Court

On the first issue, the CA rulin+ which upheld the ;urisdiction of the /eC to resolve the issue ofwho 7etween petitioner or respondent is the lawful owner of the propert, and is thus entitled to the

2aterial or de facto possession thereof! is correct. Section 13, Rule 4' of the Rules of Courtprovides that when the defendant raises the defense of ownership in his pleadin+s and the 6uestionof possession cannot 7e resolved without decidin+ the issue of ownership, the issue of ownershipshall 7e resolved onl to deter2ine the issue of possession. he ;ud+2ent rendered in an action forunlawful detainer shall 7e conclusive with respect to the possession onl and shall in no wise 7indthe title or affect the ownership of the land or 7uildin+. Such ;ud+2ent would not 7ar an action7etween the sa2e parties respectin+ title to the land or 7uildin+.)%

he su22ar nature of the action is not chan+ed 7 the clai2 of ownership of the propert of thedefendant.)4he /eC is not divested of its ;urisdiction over the unlawful detainer action si2pl7ecause the defendant asserts ownership over the propert.

he sole issue for resolution in an action for unlawful detainer is 2aterial or de facto possession ofthe propert. Even if the defendant clai2s ;uridical possession or ownership over the propert 7asedon a clai2 that his transaction with the plaintiff relative to the propert is 2erel an e6uita7le2ort+a+e, or that he had repurchased the propert fro2 the plaintiff, the /eC 2a still delve intoand ta0e co+ni@ance of the case and 2a0e an initial or provisional deter2ination of who 7etween theplaintiff and the defendant is the owner and, in the process, resolve the issue of who is entitled to thepossession. he /eC, in unlawful detainer case, decides the 6uestion of ownership onl if it isintertwined with and necessar to resolve the issue of possession.)3he resolution of the /eC onthe ownership of the propert is 2erel provisional or interlocutor. An 6uestion involvin+ the issueof ownership should 7e raised and resolved in a separate action 7rou+ht specificall to settle the6uestion with finalit, in this case, Civil Case No. '1"31 which respondent filed 7efore the RC.

he rulin+ of the CA, that the contract 7etween petitioner and respondent was an e6uita7le

2ort+a+e, is incorrect. he fact of the 2atter is that the respondent intransi+entl alle+ed in hisanswer, and even in his affidavit and position paper, that petitioner had +ranted hi2 the ri+ht toredee2 or repurchase the propert at an ti2e and for a reasona7le a2ount> and that, he had, infact, repurchased the propert in he had reac6uired ownership and;uridical possession of the propert after his repurchase thereof in 1&3> and conse6uentl, petitionerwas o7li+ed to e8ecute a deed of a7solute sale over the propert in his favor.
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Nota7l, respondent alle+ed that, as stated in his letter to petitioner, he was +iven the ri+ht toreac6uire the propert in 1&3* within two ears upon the pa2ent of P(,'''.'', plus petitioner:sairfare for her trip to the Philippines fro2 the 9SA and 7ac0> petitioner pro2ised to si+n the deedof a7solute sale. =e even filed a co2plaint a+ainst the petitioner in the RC, doc0eted as Civil CaseNo. '1"31, for specific perfor2ance with da2a+es to co2pel petitioner to e8ecute the said deed ofa7solute sale over the propert presu2a7l on the stren+th of Articles 1(4 and 1(3 of the New

Civil Code. Certainl then, his clai2 that petitioner had +iven hi2 the ri+ht to repurchase the propertis antithetical to an e6uita7le 2ort+a+e.

An e6uita7le 2ort+a+e is one that, althou+h lac0in+ in so2e for2alit, for2 or words, or otherre6uisites de2anded 7 a statute, nevertheless reveals the intention of the parties to chan+e a realpropert as securit for a de7t and contain nothin+ i2possi7le or contrar to law.)&A contract7etween the parties is an e6uita7le 2ort+a+e if the followin+ re6uisites are present? a! the partiesentered into a contract deno2inated as a contract of sale> and 7! the intention was to secure ane8istin+ de7t 7 wa of 2ort+a+e.'he decisive factor is the intention of the parties.

In an e6uita7le 2ort+a+e, the 2ort+a+or retains ownership over the propert 7ut su7;ect toforeclosure and sale at pu7lic auction upon failure of the 2ort+a+or to pa his o7li+ation.1In

contrast, in a pacto de retro sale, ownership of the propert sold is i22ediatel transferred to thevendee a retro su7;ect onl to the ri+ht of the vendor a retro to repurchase the propert uponco2pliance with le+al re6uire2ents for the repurchase. he failure of the vendor a retro to e8ercisethe ri+ht to repurchase within the a+reed ti2e vests upon the vendee a retro, 7 operation of law,a7solute title over the propert.*

One repurchases onl what one has previousl sold. he ri+ht to repurchase presupposes a validcontract of sale 7etween the sa2e parties.(- insistin+ that he had repurchased the propert,respondent there7 ad2itted that the deed of a7solute sale e8ecuted 7 hi2 and petitioner on April1(, 1&3* was, in fact and in law, a deed of a7solute sale and not an e6uita7le 2ort+a+e> hence, hehad ac6uired ownership over the propert 7ased on said deed. Respondent is, thus, estopped fro2assertin+ that the contract under the deed of a7solute sale is an e6uita7le 2ort+a+e unless there isalle+ation and evidence of palpa7le 2ista0e on the part of respondent>)or a fraud on the part of

petitioner. Respondent 2ade no such alle+ation in his pleadin+s and affidavit. On the contrar, he2aintained that petitioner had sold the propert to hi2 in


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an other intention that would contradict its plain i2port.4he clear ter2s of the contract shouldnever 7e the su7;ect 2atter of interpretation. Neither a7stract ;ustice nor the rule of li7eralinterpretation ;ustifies the creation of a contract for the parties which the did not 2a0e the2selves,or the i2position upon one part to a contract or o7li+ation to assu2e si2pl or 2erel to avoidsee2in+ hardships.3heir true 2eanin+ 2ust 7e enforced, as it is to 7e presu2ed that thecontractin+ parties 0now their scope and effects.&As the Court held in $illarica, et al. v. Court of

Appeals?%'

he ri+ht of repurchase is not a ri+ht +ranted the vendor 7 the vendee in a su7se6uent instru2ent,7ut is a ri+ht reserved 7 the vendor in the sa2e instru2ent of sale as one of the stipulations of thecontract. Once the instru2ent of a7solute sale is e8ecuted, the vendor can no lon+er reserve theri+ht to repurchase, and an ri+ht thereafter +ranted the vendor 7 the vendee in a separateinstru2ent cannot 7e a ri+ht of repurchase 7ut so2e other ri+ht li0e the option to 7u in the instantcase.%1

In Ra2os v. Icasiano,%*we also held that an a+ree2ent to repurchase 7eco2es a pro2ise to sellwhen 2ade after the sale 7ecause when the sale is 2ade without such a+ree2ent the purchaserac6uires the thin+ sold a7solutel> and, if he afterwards +rants the vendor the ri+ht to repurchase, it

is a new contract entered into 7 the purchaser as a7solute owner. An option to 7u or a pro2ise tosell is different and distinct fro2 the ri+ht of repurchase that 2ust 7e reserved 7 2eans ofstipulations to that effect in the contract of sale.%(

here is no evidence on record that, on or 7efore otherwise, the sale shall 7e void%)and cannot produce an le+al effect as to transfer thepropert fro2 its lawful owner.%-ein+ ine8istent and void fro2 the ver 7e+innin+, said contractcannot 7e ratified.%%An contract entered into 7 $entura for and in 7ehalf of petitioner relative to thesale of the propert is void and cannot 7e ratified 7 the latter. A void contract produces no effect

either a+ainst or in favor of anone.%4

Respondent also failed to prove that the ne+otiations 7etween hi2 and petitioner has cul2inated inhis offer to 7u the propert for P*','''.'', and that the later on a+reed to the sale of the propertfor the sa2e a2ount. =e li0ewise failed to prove that he purchased and reac6uired the propert in


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(! Cause of the o7li+ation which is esta7lished.

Contracts are perfected 7 2ere consent 2anifested 7 the 2eetin+ of the offer and the acceptanceupon the thin+ and the cause which are to constitute the contract.4*Once perfected, the 7ind thecontractin+ parties and the o7li+ations arisin+ therefro2 have the for2 of law 7etween the partieswhich 2ust 7e co2plied with in +ood faith. he parties are 7ound not onl to the fulfill2ent of what

has 7een e8pressl stipulated 7ut also to the conse6uences which, accordin+ to their nature, 2a 7ein 0eepin+ with +ood faith, usa+e and law.4(

here was no contract of sale entered into 7 the parties 7ased on the Receipts dated


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parents for their plane fare to the 9SA. Neither $entura nor Eu+ene Ro7erts declared in their lettersthat $entura had used the P*','''.'' which respondent +ave to her.

Petitioner in her letter to respondent did not ad2it, either e8pressl or i2pliedl, havin+ receivedP*11,'''.'' fro2 $entura. /oreover, in her letter to petitioner, onl a wee0 earlier, or on


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For resolution is a petition for review on certiorariunder Rule 45 of the

Rules of Court, assailing the Decision [1]dated Octoer !, "### of the Court of

$ppeals %C$& in C$-'(R( C) *o( +1"4, disissing petitioners appeal and

affiring the decision of the Regional .rial Court %R.C& of /alolos, 0ulacan,

0ranch , in Civil Case *o( 2-/-4(

.he antecedent facts are as follows3

uis )( Cru and $ida Cru %petitioners& are occupants of the front portion of a

1#-s6uare eter propert7 located in 8to( Cristo, 0aliuag, 0ulacan( On Octoer "1,

14, spouses $le9andro Fernando, 8r( and Rita Fernando %respondents& filed

efore the R.C a coplaint for accion publiciana against petitioners, deanding

the latter to vacate the preises and to pa7 the aount of :5##(## a onth as

reasonale rental for the use thereof( Respondents alleged in their coplaint that3

%1& the7 are owners of the propert7, having ought the sae fro the spouses

Clodualdo and .eresita 'lorioso %'loriosos& per Deed of 8ale dated /arch ,

12; %"& prior to their ac6uisition of the propert7, the 'loriosos offered to sell to

petitioners the rear portion of the propert7 ut the transaction did not aterialie

due to petitioners failure to e


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the affirative defenses that3 %1& theKasunduanis a perfected contract of sale; %"&

the agreeent has alread7 een partiall7 consuated as the7 alread7 relocated

their house fro the rear portion of the lot to the front portion that was sold to

the; %!& /rs( 'lorioso prevented the coplete consuation of the sale when

she refused to have the e


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1( Ahether the @onorale Court of $ppeals coitted an error of law inholding that the $greeent %Basunduan& etween the parties was a ere offer to

sell, and not a perfected Contract of :urchase and 8ale

"( Ahether the @onorale Court of $ppeals coitted an error of law in

not holding that where the parties clearl7 gave the petitioners a period of tie

within which to pa7 the price, ut did not fi< said period, the reed7 of thevendors is to as= the Court to fi< the period for the pa7ent of the price, and not

an accion publiciana

!( Ahether the @onorale Court of $ppeals coitted an error of law in

not ordering respondents to at least deliver the ac= portion of the lot in 6uestion

upon pa7ent of the agreed price thereof 7 petitioners, assuing that theRegional .rial Court was correct in finding that the su9ect atter of the sale was

said ac= portion, and not the front portion of the propert7

4( Ahether the @onorale Court of $ppeals coitted an error of law in

affiring the decision of the trial court ordering the petitioners, who are

possessors in good faith, to pa7 rentals for the portion of the lot possessed 7the[+]

.he R.C dwelt on the issue of which portion was eing sold 7 the

'loriosos to petitioners, finding that it was the rear portion and not the front

portion that was eing sold; while the C$ construed the Kasunduan as a ere

contract to sell and due to petitioners failure to pa7 the purchase price, the

'loriosos were not oliged to deliver to the %petitioners& the portion eing sold(

:etitioners, however, insist that the agreeent was a perfected contract of

sale, and their failure to pa7 the purchase price is iaterial( .he7 also contend

that respondents have no cause of action against the, as the oligation set in the

Kasunduandid not set a period, conse6uentl7, there is no reach of an7 oligation

7 petitioners(
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.he resolution of the issues in this case principall7 is dependent on the

interpretation of theKasunduandated $ugust +, 12! e


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?n a contract of sale, the title to the propert7 passes to the vendee upon the

deliver7 of the thing sold, as distinguished fro a contract to sell where ownership

is, 7 agreeent, reserved in the vendor and is not to pass to the vendee until full

pa7ent of the purchase price([2]Otherwise stated, in a contract of sale, the vendor

loses ownership over the propert7 and cannot recover it until and unless the

contract is resolved or rescinded; whereas, in a contract to sell, title is retained 7

the vendor until full pa7ent of the price( ?n the latter contract, pa7ent of the

price is a positive suspensive condition, failure of which is not a reach ut an

event that prevents the oligation of the vendor to conve7 title fro ecoing

effective(

.heKasunduanprovides for the following ters and conditions3 %a& that the

'loriosos agreed to sell to petitioners a portion of the propert7 with an area of "1!

eters at the price of :4#(## per s6uare eter; %& that in the title that will e

caused to e issued, the aggregate area is ""! s6uare eters with 1# eters thereof

serving as right of wa7; %c& that the right of wa7 shall have a width of 1(5 eters

fro ope aena road going towards the ac= of the lot where petitioners will

uild their house on the portion of the lot that the7 will u7; %d& that the e


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an essentia* e*e(ent eore a 6a*id and indin+ -ontra-t o sa*e -an eist([]

$lthough the Civil Code does not e


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*orall7, in a contract to sell, the pa7ent of the purchase price is the

positive suspensive condition upon which the transfer of ownership depends([1!].he

parties, however, are not prohiited fro stipulating other lawful conditions that

ust e fulfilled in order for the contract to e converted fro a contract to sell or

at the ost an e


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fulfillent of the suspensive condition rendered the contract to sell ineffective and

unperfected(

:etitioners adit that the7 have not paid a single centavo to the 'loriosos(

@owever, petitioners argue that their nonpa7ent of the purchase price was due to

the fact that there is 7et to e a surve7 ade of the propert7( 0ut evidence shows,

and petitioners do not dispute, that as earl7 as $ugust 1", 12!, or si< da7s after

the e


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not raised tiel7 in the proceedings in the lower court are arred 7 estoppel( [1+]

/atters, theories or arguents not rought out in the original proceedings cannot

e considered on review or appeal where the7 are raised for the first tie( .o

consider the alleged facts and arguents raised elatedl7 would aount to

trapling on the asic principles of fair pla7, 9ustice and due process( [1]

/oreover, it would e inutile for respondents to first petition the court to fiR>D(

G.R. No. L"41#47 $e%e&ber 12, 19#6

ATALINO LEABRES, petitioner,vs.O'RT OF APPEALS a() MANOTO* REALT+, IN., respondents.

Magtanggol C. !nig!ndo for petitioner.

Marcelo de !man for respondents.

PARAS, J.:

-efore 9s is a Petition for certiorari to review the decision of the Court of Appeals which is 6uotedhereunder?

In Civil Case No. %))(), the Court of irst Instance of /anila 2ade the followin+ 6uoted decision?

1! 9pon defendants counterclai2, orderin+ plaintiff Catalino 5ea7res to vacateandBor surrender possession to defendant /anoto0 Realt, Inc. the parcel of landsu7;ect 2atter of the co2plaint descri7ed in para+raph ( thereof and descri7ed in the-ill of Particulars dated /arch ), 1&%%>

*! o pa defendant the su2 of P31.'' per 2onth fro2 /arch *', 1&&, up to theti2e he actuall vacates andBor surrenders possession of the said parcel of land to

the defendant /anoto0 Realt, Inc., and

(! o pa attornes fees to the defendant in the a2ount of P4''.'' and pa thecosts. Decision, R.A., pp. )"!.

he facts of this case 2a 7e 7riefl stated as follows?

Clara a27untin+ de 5e+arda died testate on April **, 1&'. A2on+ the properties left 7 thedeceased is the 5e+arda a27untin+ Su7division located on Ri@al Avenue E8tension, Cit of


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/anila, containin+ an area of 3',*(3.&' s6. 2., covered 7 ransfer Certificates of itle No. %*')*>)1)*> )1)&> )&43> )'&4 and &3. Shortl after the death of said deceased, plaintiff Catalino5ea7res 7ou+ht, on a partial pa2ent of Pl,'''.'' a portion No. $III, 5ot No. 1! of the Su7divisionfro2 survivin+ hus7and $icente


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=E 5OER CO9R ERRED IN ORDERIN# =E P5AINI"APPE55AN OPAF DEENDAN"APPE55EE =E S9/ O P 31.'' PER /ON= RO/ /ARC=*', 1&%&, 9P O =E I/E =E AC9A55F $ACAE =E PARCE5 O 5AND.Appellants -rief, p. 4!

In the irst Assi+ned Error, it is contended that the denial of his /otion for Reconsideration dated

Octo7er &, 1&%4, the plaintiff"appellant was not accorded his da in Court.

he rule +overnin+ dis2issal of actions for failure to prosecute is provided for in Section (, Rule 14of the Rules of Court, as follows?

If the plaintiff fails to appear at the ti2e of the trial, or to prosecute his action for an unreasona7lelen+th of ti2e, or to co2pl with these rules or an order of the Court, the action 2a 7e dis2issedupon 2otion of the defendant or upon the Courts own 2otion. his dis2issal shall have the effect ofan ad;udication upon the 2erits, unless otherwise provided 7 the Court.

9nder the afore"cited section, it is discretionar on the part of the Court to dis2iss an action forfailure to prosecute, and its action will not 7e reversed upon appeal in the a7sence of a7use. he

7urden of showin+ a7use of this discretion is upon the appellant since ever presu2ption is towardthe correctness of the Courts action S2ith, -ell Co., et al vs. A2erican Pres. 5ines, 5td., and/anila er2inal Co., No. 5"('), April (', 1&)> Adora7le vs. -onifacio, #. R. No. 5"'%&3, April **,1&&!> lores vs. Phil. Alien Propert Ad2inistration, #.R. No. 5"1*4)1, April *4, 1&%'!. - thedoctrine laid down in these cases, and 7 the provisions of Section , Rules 1(1 of the Rules ofCourt, particularl para+raphs 2! and o! which respectivel presu2e the re+ularit of officialperfor2ance and the passin+ upon 7 the Court over all issues within a case, it 2atters not if theCourt dis2issin+ the action for failure to prosecute assi+ns an special reason for its action or not.e ta0e note of the fact that the Order declarin+ appellant in default was handed down onSepte27er 1), 1&%4. Appellant too0 no steps to have this Order set aside. It was onl on that he has introducedi2prove2ents and erected a house thereon 2ade of stron+ 2aterials> that appellees adverseinterest over the propert was secured in 7ad faith since he had prior 0nowled+e and notice ofappellants phsical possession or ac6uisition of the sa2e> that due to said 7ad faith appellant hassuffered da2a+es, and that for all the fore+oin+, the ;ud+2ent should 7e reversed and e6uita7lerelief 7e +iven in his favor.


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As a7ove stated, the 5e+arda"a27untin+ Su7division which includes the lot su7;ect 2atter of theinstant case, is covered 7 orrens Certificates of itle. Appellant anchors his clai2 on the receiptAnne8 A! dated /a *, 1&', which he clai2s as evidence of the sale of said lot in his favor.Ad2ittedl, however, Catalino 5ea7res has not re+istered his supposed interest over the lot in therecords of the Re+ister of Deeds, nor did he present his clai2 for pro7ate in the testate proceedin+sover the estate of the owner of said su7division, in spite of the notices advertised in the papers.

Saldana vs. Phil. rust Co., et al.> /anoto0 Realt, Inc.,s!pra!.

On the other hand, defendant"appellee, /anoto0 Realt, Inc., 7ou+ht the whole su7division whichincludes the su7;ect 2atter herein 7 order and with approval of the Pro7ate Court and upon saidapproval, the Deed of A7solute Sale in favor of appellee was i22ediatel re+istered with the properRe+ister of Deeds. /anoto0 Realt, Inc. has therefore the 7etter ri+ht over the lot in 6uestion7ecause in cases of lands re+istered under the orrens 5aw, adverse interests not therein annotatedwhich are without the previous 0nowled+e 7 third parties do not 7ind the latter. As to thei2prove2ent which appellant clai2s to have introduced on the lot, purchase of re+istered lands forvalue and in +ood faith hold the sa2e free fro2 all liens and encu27rances e8cept those noted onthe titles of said land and those 7urdens i2posed 7 law. Sec. (&, Act. )&%!.#$re%%an&'1(w)An occupant of a land,or a purchaser thereof fro2 a person other than the re+istered owner, cannot clai2 +ood faith so asto 7e entitled to retention of the parcels occupied 7 hi2 until rei27urse2ent of the value of thei2prove2ents he introduced thereon, 7ecause he is char+ed with notice of the e8istence of theowners certificate of title


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/oreover, as pointed out 7 private respondent in its 7rief, the hearin+ on *! deter2inate su7;ect 2atter> (! price certain in2one or its e6uivalent"are lac0in+ in said receipt and therefore the sale is not valid norenforcea7le. urther2ore, it is a fact that Dona Clara a27untin+ died on April **, 1&'. =er estatewas thereafter under c!stodia legisof the Pro7ate Court which appointed Don $icente 5e+arda asSpecial Ad2inistrator on Au+ust *3, 1&'. Don $icente 5e+arda entered into said sale in his own

personal"capacit and without court approval, conse6uentl, said sale cannot 7ind the estate ofClara a27untin+. Petitioner should have su72itted the receipt of alle+ed sale to the Pro7ate Courtfor its approval of the transactions. hus, the respondent Court did not err in holdin+ that thepetitioner should have su72itted his receipt to the pro7ate court in order that his ri+ht over thesu7;ect land could 7e reco+ni@ed"assu2in+ of course that the receipt could 7e re+arded as sufficientproof.

Anent his possession of the land, petitioner cannot 7e dee2ed a possessor in +ood faith in view ofthe re+istration of the ownership of the land. o consider petitioner in +ood faith would 7e to put apre2iu2 on his own +ross ne+li+ence. he Court resolved to DENF the petition for lac0 of 2erit andto AIR/ the assailed ;ud+2ent.

G.R. No. 10-77 O%ober 7, 1996

ROM'LO A. ORONEL, ALARIO A. ORONEL, ANNETTE A. ORONEL, ANNABELLE .GON/ALES or er3e a() o( bea o For5)a . Tuer, a3 aor(ey"5("a%, IELITO A.ORONEL, FLORAI$A A. ALMONTE, a() ATALINA BALAIS MABANAG, petitioners,vs.T8E O'RT OF APPEALS, ONEPION $. ALARA/, a() RAMONA PATRIIA ALARA/,a3353e) by GLORIA F. NOEL a3 aor(ey"5("a%, respondents.

MELO, J.:p

he petition 7efore us has its roots in a co2plaint for specific perfor2ance to co2pel hereinpetitioners e8cept the last na2ed, Catalina -alais /a7ana+! to consu22ate the sale of a parcel ofland with its i2prove2ents located alon+ Roosevelt Avenue in Mue@on Cit entered into 7 theparties so2eti2e in


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On

*. he Coronels will cause the transfer in their na2es of the title of thepropert re+istered in the na2e of their deceased father upon receipt of theift housand P','''.''! Pesos down pa2ent>

(. 9pon the transfer in their na2es of the su7;ect propert, the Coronels wille8ecute the deed of a7solute sale in favor of Ra2ona and the latter will pathe for2er the whole 7alance of One /illion One =undred Ninet housandP1,1&','''.''! Pesos.

On the sa2e date


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Pesos after the latter has paid hree =undred housand P('','''.''!Pesos E8hs. "(> E8h. %"C!

or this reason, Coronels canceled and rescinded the contract E8h. A! withRa2ona 7 depositin+ the down pa2ent paid 7 Concepcion in the 7an0 intr!st for Ramona Patricia Alcara.

On e7ruar **, 1&3, Concepcion, et al., filed a co2plaint for specificperfor2ance a+ainst the Coronels and caused the annotation of a notice oflis pendens at the 7ac0 of C No. (*4)'( E8h. E> E8h. !.

On April *, 1&3, Catalina caused the annotation of a notice of adverse clai2coverin+ the sa2e propert with the Re+istr of Deeds of Mue@on Cit E8h.> E8h. %!.

On April *, 1&3, the Coronels e8ecuted a Deed of A7solute Sale over thesu7;ect propert in favor of Catalina E8h. #> E8h. 4!.

On E8h. 3!.

Rollo, pp. 1()"1(%!

In the course of the proceedin+s 7efore the trial court -ranch 3(, RC, Mue@on Cit! the partiesa+reed to su72it the case for decision solel on the 7asis of docu2entar e8hi7its. hus, plaintiffstherein now private respondents! proffered their docu2entar evidence accordin+l 2ar0ed asE8hi7its A throu+h


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Plaintiffs clai2 for da2a+es and attornes fees, as well as the counterclai2sof defendants and intervenors are here7 dis2issed.

No pronounce2ent as to costs.

So Ordered.

/aca7e7e, Pa2pan+a for Mue@on Cit, /arch 1, 1&3&.

Rollo, p. 1'%!

A 2otion for reconsideration was filed 7 petitioner 7efore the new presidin+ ;ud+e of the Mue@onCit RC 7ut the sa2e was denied 7


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SO ORDERED.

Mue@on Cit, Philippines,


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a! Consent or 2eetin+ of the 2inds, that is, consent to transfer ownership ine8chan+e for the price>

7! Deter2inate su7;ect 2atter> and

c! Price certain in 2one or its e6uivalent.

9nder this definition, a Contract to Sell 2a not 7e considered as a Contract of Sale 7ecause thefirst essential ele2ent is lac0in+. In a contract to sell, the prospective seller e8plicit reserves thetransfer of title to the prospective 7uer, 2eanin+, the prospective seller does not as et a+ree orconsent to transfer ownership of the propert su7;ect of the contract to sell until the happenin+ of anevent, which for present purposes we shall ta0e as the full pa2ent of the purchase price. hat theseller a+rees or o7li+es hi2self to do is to fulfill is pro2ise to sell the su7;ect propert when theentire a2ount of the purchase price is delivered to hi2. In other words the full pa2ent of thepurchase price parta0es of a suspensive condition, the non"fulfill2ent of which prevents theo7li+ation to sell fro2 arisin+ and thus, ownership is retained 7 the prospective seller without furtherre2edies 7 the prospective 7uer. In Ro*!e vs. ,ap! &% SCRA 4)1 1&3'J!, this Court hadoccasion to rule?

=ence, e hold that the contract 7etween the petitioner and the respondentwas a contract to sell where the ownership or title is retained 7 the sellerand is not to pass until the full pa2ent of the price, such pa2ent 7ein+ apositive suspensive condition and failure of which is not a 7reach, casual orserious, 7ut si2pl an event that prevented the o7li+ation of the vendor toconve title fro2 ac6uirin+ 7indin+ force.

Stated positivel, upon the fulfill2ent of the suspensive condition which is the full pa2ent of thepurchase price, the prospective sellers o7li+ation to sell the su7;ect propert 7 enterin+ into acontract of sale with the prospective 7uer 7eco2es de2anda7le as provided in Article 1)4& of theCivil Code which states?

Art. 1)4&. A pro2ise to 7u and sell a deter2inate thin+ for a price certain isreciprocall de2anda7le.

An accepted unilateral pro2ise to 7u or to sell a deter2inate thin+ for aprice certain is 7indin+ upon the pro2issor if the pro2ise is supported 7 aconsideration distinct fro2 the price.

A contract to sell 2a thus 7e defined as a 7ilateral contract where7 the prospective seller, whilee8pressl reservin+ the ownership of the su7;ect propert despite deliver thereof to the prospective7uer, 7inds hi2self to sell the said propert e8clusivel to the prospective 7uer upon fulfill2ent ofthe condition a+reed upon, that is, full pa2ent of the purchase price.

A contract to sell as defined hereina7ove, 2a not even 7e considered as a conditional contract ofsale where the seller 2a li0ewise reserve title to the propert su7;ect of the sale until the fulfill2entof a suspensive condition, 7ecause in a conditional contract of sale, the first ele2ent of consent ispresent, althou+h it is conditioned upon the happenin+ of a contin+ent event which 2a or 2a notoccur. If the suspensive condition is not fulfilled, the perfection of the contract of sale is co2pletela7ated cf. =o2esite and housin+ Corp. vs. Court of Appeals, 1(( SCRA 444 1&3)J!. =owever, ifthe suspensive condition is fulfilled, the contract of sale is there7 perfected, such that if there hadalread 7een previous deliver of the propert su7;ect of the sale to the 7uer, ownership thereto


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auto2aticall transfers to the 7uer 7 operation of law without an further act havin+ to 7eperfor2ed 7 the seller.

In a contract to sell, upon the fulfill2ent of the suspensive condition which is the full pa2ent of thepurchase price, ownership will not auto2aticall transfer to the 7uer althou+h the propert 2ahave 7een previousl delivered to hi2. he prospective seller still has to conve title to the

prospective 7uer 7 enterin+ into a contract of a7solute sale.

It is essential to distin+uish 7etween a contract to sell and a conditional contract of sale speciall incases where the su7;ect propert is sold 7 the owner not to the part the seller contracted with, 7utto a third person, as in the case at 7ench. In a contract to sell, there 7ein+ no previous sale of thepropert, a third person 7uin+ such propert despite the fulfill2ent of the suspensive condition suchas the full pa2ent of the purchase price, for instance, cannot 7e dee2ed a 7uer in 7ad faith andthe prospective 7uer cannot see0 the relief of reconveance of the propert. here is no dou7le salein such case. itle to the propert will transfer to the 7uer after re+istration 7ecause there is nodefect in the owner"sellers titleper se, 7ut the latter, of course, 2a 7e used for da2a+es 7 theintendin+ 7uer.

In a conditional contract of sale, however, upon the fulfill2ent of the suspensive condition, the sale7eco2es a7solute and this will definitel affect the sellers title thereto. In fact, if there had 7eenprevious deliver of the su7;ect propert, the sellers ownership or title to the propert isauto2aticall transferred to the 7uer such that, the seller will no lon+er have an title to transfer toan third person. Applin+ Article 1)) of the Civil Code, such second 7uer of the propert who2a have had actual or constructive 0nowled+e of such defect in the sellers title, or at least waschar+ed with the o7li+ation to discover such defect, cannot 7e a re+istrant in +ood faith. Suchsecond 7uer cannot defeat the first 7uers title. In case a title is issued to the second 7uer, thefirst 7uer 2a see0 reconveance of the propert su7;ect of the sale.

ith the a7ove postulates as +uidelines, we now proceed to the tas0 of decipherin+ the real natureof the contract entered into 7 petitioners and private respondents.

It is a canon in the interpretation of contracts that the words used therein should 7e +iven theirnatural and ordinar 2eanin+ unless a technical 2eanin+ was intended an vs. Court of Appeals*1* SCRA 3% 1&&*J!. hus, when petitioners declared in the said Receipt of Down Pa2ent thatthe

Received fro2 /iss Ra2ona Patricia Alcara@ of 1)% i2o+, Mue@on Cit, thesu2 of ift housand Pesosp!rchase price of o!r inherited ho!se and lot,covered 7 C No. 11&&%*4 of the Re+istr of Deeds of Mue@on Cit, in thetotal a2ount of P1,*)','''.''.

without an reservation of title until full pa2ent of the entire purchase price, thenatural and ordinar idea conveed is that the sold their propert.

hen the Receipt of Down Pa2ent is considered in its entiret, it 7eco2es 2ore 2anifest thatthere was a clear intent on the part of petitioners to transfer title to the 7uer, 7ut since the transfercertificate of title was still in the na2e of petitioners father, the could not full effect such transferalthou+h the 7uer was then willin+ and a7le to i22ediatel pa the purchase price. herefore,petitioners"sellers undertoo0 upon receipt of the down pa2ent fro2 private respondent Ra2ona P.Alcara@, to cause the issuance of a new certificate of tit le in their na2es fro2 that of their father,after which, the pro2ised to present said title, now in their na2es, to the latter and to e8ecute the


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deed of a7solute sale whereupon, the latter shall, in turn, pa the entire 7alance of the purchaseprice.

he a+ree2ent could not have 7een a contract to sell 7ecause the sellers herein 2adeno e+pressreservation of ownership or title to the s!bect parcel of land. urther2ore, the circu2stance whichprevented the parties fro2 enterin+ into an a7solute contract of sale pertained to the sellers

the2selves the certificate of title was not in their na2es! and not the full pa2ent of the purchaseprice. 9nder the esta7lished facts and circu2stances of the case, the Court 2a safel presu2ethat, had the certificate of title 7een in the na2es of petitioners"sellers at that ti2e, there would have7een no reason wh an a7solute contract of sale could not have 7een e8ecuted and consu22atedri+ht there and then.

/oreover, unli0e in a contract to sell, petitioners in the case at 7ar did not 2erel pro2ise to sell theproperl to private respondent upon the fulfill2ent of the suspensive condition. On the contrar,havin+ alread a+reed to sell the su7;ect propert, the undertoo0 to have the certificate of titlechan+ed to their na2es and i22ediatel thereafter, to e8ecute the written deed of a7solute sale.

hus, the parties did not 2erel enter into a contract to sell where the sellers, after co2pliance 7

the 7uer with certain ter2s and conditions, pro2ised to sell the propert to the latter. hat 2a 7eperceived fro2 the respective underta0in+s of the parties to the contract is that petitioners hadalread a+reed to sell the house and lot the inherited fro2 their father, co2pletel willin+ to transferfull ownership of the su7;ect house and lot to the 7uer if the docu2ents were then in order. It ;usthappened, however, that the transfer certificate of title was then still in the na2e of their father. Itwas 2ore e8pedient to first effect the chan+e in the certificate of title so as to 7ear their na2es. hatis wh the undertoo0 to cause the issuance of a new transfer of the certificate of title in their na2esupon receipt of the down pa2ent in the a2ount of P','''.''. As soon as the new certificate oftitle is issued in their na2es, petitioners were co22itted to i22ediatel e8ecute the deed ofa7solute sale. Onl then will the o7li+ation of the 7uer to pa the re2ainder of the purchase pricearise.

here is no dou7t that unli0e in a contract to sell which is 2ost co22onl entered into so as to

protect the seller a+ainst a 7uer who intends to 7u the propert in install2ent 7 withholdin+ownership over the propert until the 7uer effects full pa2ent therefor, in the contract entered intoin the case at 7ar, the sellers were the one who were una7le to enter into a contract of a7solute sale7 reason of the fact that the certificate of title to the propert was still in the na2e of their father. Itwas the sellers in this case who, as it were, had the i2pedi2ent which prevented, so to spea0, thee8ecution of an contract of a7solute sale.

hat is clearl esta7lished 7 the plain lan+ua+e of the su7;ect docu2ent is that when the saidReceipt of Down Pa2ent was prepared and si+ned 7 petitioners Ro2eo A. Coronel, et al., theparties had a+reed to a conditional contract of sale, consu22ation of which is su7;ect onl to thesuccessful transfer of the certificate of title fro2 the na2e of petitioners father, Constancio P.Coronel, to their na2es.

he Court si+nificantl notes this suspensive condition was, in fact, fulfilled on e7ruar %, 1&3E8h. D> E8h. )!. hus, on said date, the conditional contract of sale 7etween petitioners andprivate respondent Ra2ona P. Alcara@ 7eca2e o7li+ator, the onl act re6uired for theconsu22ation thereof 7ein+ the deliver of the propert 7 2eans of the e8ecution of the deed ofa7solute sale in a pu7lic instru2ent, which petitioners une6uivocall co22itted the2selves to do asevidenced 7 the Receipt of Down Pa2ent.


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Article 1)4, in correlation with Article 1131, 7oth of the Civil Code, plainl applies to the case at7ench. hus,

Art. 1)4. he contract of sale is perfected at the 2o2ent there is a 2eetin+of 2inds upon the thin+ which is the o7;ect of the contract and upon theprice.

ro2 the 2o2ent, the parties 2a reciprocall de2and perfor2ance, su7;ectto the provisions of the law +overnin+ the for2 of contracts.

Art. 1131. In conditional o7li+ations, the ac6uisition of ri+hts, as well as thee8tin+uish2ent or loss of those alread ac6uired, shall depend upon thehappenin+ of the event which constitutes the condition.

Since the condition conte2plated 7 the parties which is the issuance of a certificate of title inpetitioners na2es was fulfilled on e7ruar %, 1&3, the respective o7li+ations of the parties underthe contract of sale 7eca2e 2utuall de2anda7le, that is, petitioners, as sellers, were o7li+ed topresent the transfer certif icate of title alread in their na2es to private respondent Ra2ona P.

Alcara@, the 7uer, and to i22ediatel e8ecute the deed of a7solute sale, while the 7uer on herpart, was o7li+ed to forthwith pa the 7alance of the purchase price a2ountin+ to P1,1&','''.''.

It is also si+nificant to note that in the first para+raph in pa+e & of their petition, petitionersconclusivel ad2itted that?

(. he petitioners"sellers Coronel 7ound the2selves to effect the transfer inour na2es fro2 our deceased father Constancio P. Coronel, the transfercertificate of title i22ediatel upon receipt of the downpa2ent a7ove"stated. /he sale was still s!bect to this s!spensive condition. E2phasissupplied.!

Rollo, p. 1%!

Petitioners the2selves reco+ni@ed that the entered into a contract of sale su7;ect to a suspensivecondition. Onl, the contend, continuin+ in the sa2e para+raph, that?

. . . =ad petitioners"sellers not complied with this condition of first transferrin+the title to the propert under their na2es, there could 7e no perfectedcontract of sale. E2phasis supplied.!

0bid.!

not aware that the set their own trap for the2selves, for Article 113% of the Civil

Code e8pressl provides that?

Art. 113%. he condition shall 7e dee2ed fulfilled when the o7li+or voluntarilprevents its fulfill2ent.

-esides, it should 7e stressed and e2phasi@ed that what is 2ore controllin+ than these 2erehpothetical ar+u2ents is the fact that the condition herein referred to was act!all and indisp!tablf!lfilled on 2ebr!ar 3 1456, when a new title was issued in the na2es of petitioners as evidenced7 C No. (*4)'( E8h. D> E8h. )!.


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he inevita7le conclusion is that on E8h. 1!, the parties entered into a contract of sale su7;ectonl to the suspensive condition that the sellers shall effect the issuance of new certificate title fro2that of their fathers na2e to their na2es and that, on e7ruar %, 1&3, this condition was fulfilledE8h. D> E8h. )!.

e, therefore, hold that, in accordance with Article 1134 which pertinentl provides

Art. 1134. he effects of conditional o7li+ation to +ive, once the condition has7een fulfilled, shall retroact to the da of the constitution of the o7li+ation . . .

In o7li+ation to do or not to do, the courts shall deter2ine, in each case, theretroactive effect of the condition that has 7een co2plied with.

the ri+hts and o7li+ations of the parties with respect to the perfected contract of sale7eca2e 2utuall due and de2anda7le as of the ti2e of fulfill2ent or occurrence ofthe suspensive condition on e7ruar %, 1&3. As of that point in ti2e, reciprocalo7li+ations of 7oth seller and 7uer arose.

Petitioners also ar+ue there could 7een no perfected contract on


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Art. 1)(1. hrou+h estoppel an ad2ission or representation is renderedconclusive upon the person 2a0in+ it, and cannot 7e denied or disproved asa+ainst the person relin+ thereon.

=avin+ represented the2selves as the true owners of the su7;ect propert at the ti2eof sale, petitioners cannot clai2 now that the were not et the a7solute owners

thereof at that ti2e.

Petitioners also contend that althou+h there was in fact a perfected contract of sale 7etween the2and Ra2ona P. Alcara@, the latter 7reached her reciprocal o7li+ation when she rendered i2possi7lethe consu22ation thereof 7 +oin+ to the 9nited States of A2erica, without leavin+ her address,telephone nu27er, and Special Power of Attorne Para+raphs 1) and 1, Answer with Co2pulsorCounterclai2 to the A2ended Co2plaint, p. *>Rollo, p. )(!, for which reason, so petitionersconclude, the were correct in unilaterall rescindin+ rescindin+ the contract of sale.

e do not a+ree with petitioners that there was a valid rescission of the contract of sale in the instantcase. e note that these supposed +rounds for petitioners rescission, are 2ere alle+ations foundonl in their responsive pleadin+s, which 7 e8press provision of the rules, are dee2ed controverted

even if no repl is filed 7 the plaintiffs Sec. 11, Rule %, Revised Rules of Court!. he records area7solutel 7ereft of an supportin+ evidence to su7stantiate petitioners alle+ations. e havestressed ti2e and a+ain that alle+ations 2ust 7e proven 7 sufficient evidence N+ Cho Cio vs. N+Dion+, 11' Phil. 33* 1&%1J> Recaro vs. E27isan, * SCRA &3 1&%1J. /ere alle+ation is not anevidence 5a+asca vs. De $era, 4& Phil. (4% 1&)4J!.

Even assu2in+ arg!endo that Ra2ona P. Alcara@ was in the 9nited States of A2erica on e7ruar%, 1&3, we cannot ;ustif petitioner"sellers act of unilaterall and e8tradiciall rescindin+ thecontract of sale, there 7ein+ no e8press stipulation authori@in+ the sellers to e8tar;udiciall rescindthe contract of sale. cf. Di+nos vs. CA, 13 SCRA (4 1&33J> a+u7a vs. $da. de 5eon, 1(* SCRA4** 1&3)J!

/oreover, petitioners are estopped fro2 raisin+ the alle+ed a7sence of Ra2ona P. Alcara@ 7ecausealthou+h the evidence on record shows that the sale was in the na2e of Ra2ona P. Alcara@ as the7uer, the sellers had 7een dealin+ with Concepcion D. Alcara@, Ra2onas 2other, who had actedfor and in 7ehalf of her dau+hter, if not also in her own 7ehalf. Indeed, the down pa2ent was 2ade7 Concepcion D. Alcara@ with her own personal chec0 E8h. -> E8h. *! for and in 7ehalf ofRa2ona P. Alcara@. here is no evidence showin+ that petitioners ever 6uestioned Concepcionsauthorit to represent Ra2ona P. Alcara@ when the accepted her personal chec0. Neither did theraise an o7;ection as re+ards pa2ent 7ein+ effected 7 a third person. Accordin+l, as far aspetitioners are concerned, the phsical a7sence of Ra2ona P. Alcara@ is not a +round to rescind thecontract of sale.

Corollaril, Ra2ona P. Alcara@ cannot even 7e dee2ed to 7e in default, insofar as her o7li+ation topa the full purchase price is concerned. Petitioners who are precluded fro2 settin+ up the defense

of the phsical a7sence of Ra2ona P. Alcara@ as a7ove"e8plained offered no proof whatsoever toshow that the actuall presented the new transfer certificate of title in their na2es and si+nified theirwillin+ness and readiness to e8ecute the deed of a7solute sale in accordance with their a+ree2ent.Ra2onas correspondin+ o7li+ation to pa the 7alance of the purchase price in the a2ount ofP1,1&','''.'' as 7uer! never 7eca2e due and de2anda7le and, therefore, she cannot 7edee2ed to have 7een in default.

Article 11%& of the Civil Code defines when a part in a contract involvin+ reciprocal o7li+ations 2a7e considered in default, to wit?


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Art. 11%&. hose o7li+ed to deliver or to do so2ethin+, incur in dela fro2 theti2e the o7li+ee ;udiciall or e8tra;udiciall de2ands fro2 the2 the fulfill2entof their o7li+ation.

888 888 888

In reciprocal o7li+ations, neither part incurs in dela if the other does notcompl or is not read to compl in a proper manner with what is inc!mbent!pon him. ro2 the 2o2ent one of the parties fulfill his o7li+ation, dela 7the other 7e+ins. E2phasis supplied.!

here is thus neither factual nor le+al 7asis to rescind the contract of sale 7etween petitioners andrespondents.

ith the fore+oin+ conclusions, the sale to the other petitioner, Catalina -. /a7ana+, +ave rise to acase of dou7le sale where Article 1)) of the Civil Code will appl, to wit?

Art. 1)). If the sa2e thin+ should have 7een sold to different vendees, the

ownership shall 7e transferred to the person who 2a have first ta0enpossession thereof in +ood faith, if it should 7e 2ova7le propert.

Should if 7e i22ova7le propert, the ownership shall 7elon+ to the personac6uirin+ it who in +ood faith first recorded it in Re+istr of Propert.

Should there 7e no inscription, the ownership shall pertain to the person whoin +ood faith was first in the possession> and, in the a7sence thereof to theperson who presents the oldest title, provided there is +ood faith.

he record of the case shows that the Deed of A7solute Sale dated April *, 1&3 as proof of thesecond contract of sale was re+istered with the Re+istr of Deeds of Mue@on Cit +ivin+ rise to the

issuance of a new certificate of title in the na2e of Catalina -. /a7ana+ on


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it is essential, to 2erit the protection of Art. 1)), second para+raph, that thesecond realt 7uer 2ust act in +ood faith in re+isterin+ his deed of salecitin+ Car7onell vs. Court of Appeals, %& SCRA &&, Crisosto2o vs. CA, #.R.No. &3)(, '* Septe27er 1&&*!.7. 8it!g Compendi!m of Civil ,aw and 7!rispr!dence 1449 :dition p. 3;

Petitioner point out that the notice of lis pendens in the case at 7ar was annoted on the title of thesu7;ect propert onl on e7ruar **, 1&3, whereas, the second sale 7etween petitioners Coronelsand petitioner /a7ana+ was supposedl perfected prior thereto or on e7ruar 13, 1&3. he ideaconveed is that at the ti2e petitioner /a7ana+, the second 7uer, 7ou+ht the propert under aclean title, she was unaware of an adverse clai2 or previous sale, for which reason she is 7uer in+ood faith.

e are not persuaded 7 such ar+u2ent.

In a case of dou7le sale, what finds relevance and 2aterialit is not whether or not the second 7uerwas a 7uer in +ood faith 7ut whether or not said second 7uer re+isters such second sale in +oodfaith, that is, without 0nowled+e of an defect in the title of the propert sold.

As clearl 7orne out 7 the evidence in this case, petitioner /a7ana+ could not have in +ood faith,re+istered the sale entered into on e7ruar 13, 1&3 7ecause as earl as e7ruar **, 1&3, anotice of lis pendens had 7een annotated on the transfer certificate of title in the na2es ofpetitioners, whereas petitioner /a7ana+ re+istered the said sale so2eti2e in April, 1&3. At the ti2eof re+istration, therefore, petitioner /a7ana+ 0new that the sa2e propert had alread 7eenpreviousl sold to private respondents, or, at least, she was char+ed with 0nowled+e that a previous7uer is clai2in+ title to the sa2e propert. Petitioner /a7ana+ cannot close her ees to the defectin petitioners title to the propert at the ti2e of the re+istration of the propert.

his Court had occasions to rule that?

If a vendee in a dou7le sale re+isters that sale after he has ac6uired0nowled+e that there was a previous sale of the sa2e propert to a thirdpart or that another person clai2s said propert in a pervious sale, there+istration will constitute a re+istration in 7ad faith and will not confer uponhi2 an ri+ht. Salvoro vs. ane+a, 34 SCRA ()& 1&43J> citin+ Palarca vs.Director of 5and, )( Phil. 1)%> Ca+aoan vs. Ca+aoan, )( Phil. )>ernande@ vs. /ercader, )( Phil. 31.!

hus, the sale of the su7;ect parcel of land 7etween petitioners and Ra2ona P. Alcara@, perfected one7ruar %, 1&3, prior to that 7etween petitioners and Catalina -. /a7ana+ on e7ruar 13, 1&3,was correctl upheld 7 7oth the courts 7elow.

Althou+h there 2a 7e a2ple indications that there was in fact an a+enc 7etween Ra2ona as

principal and Concepcion, her 2other, as a+ent insofar as the su7;ect contract of sale is concerned,the issue of whether or not Concepcion was also actin+ in her own 7ehalf as a co"7uer is nots6uarel raised in the instant petition, nor in such assu2ption disputed 7etween 2other anddau+hter. hus, e will not touch this issue and no lon+er distur7 the lower courts rulin+ on thispoint.

=EREORE, pre2ises considered, the instant petition is here7 DIS/ISSED and the appealed;ud+2ent AIR/ED.


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SO ORDERED.

G. R. No. 1677 !u(e 2-, 200

MILAGROS MANONGSONG, o5(e) by er u3ba(), ARLITO MANONGSONG, Petitioners,vs.FELOMENA !'MA:'IO ESTIMO, EMILIANA !'MA:'IO, NARISO ORTI/, ELESTINOORTI/, RO$OLFO ORTI/, ERLIN$A O. OAMPO, PASTOR ORTI/, !R., ROMEO ORTI/BEN!AMIN $ELA R'/, SR., BEN!AMIN $ELA R'/, !R., A'RORA NIOLAS, GLORIARAA$IO, ROBERTO $ELA R'/, !OSELITO $ELA R'/ a() LEONIA S. LOPE/,Respondents.

D E C I S I O N

ARPIO, J.:

he Case

-efore this Court is a petition for review1assailin+ the Decision*of *% *! Enri6ueta 5ope@"


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Petitioners alle+ed that #uevarra was the ori+inal owner of the Propert. 9pon #uevarra:s death, herchildren inherited the Propert. Since Do2inador 5ope@ died without offsprin+, there were onl fivechildren left as heirs of #uevarra. Each of the five children, includin+ $icente 5ope@, the father of/anon+son+, was entitled to a fifth of the Propert. As $icente 5ope@: sole survivin+ heir,/anon+son+ clai2s her father:s 1B share in the Propert 7 ri+ht of representation.

here is no dispute that respondents, who are the survivin+ spouses of #uevarra:s children and theiroffsprin+, have 7een in possession of the Propert for as lon+ as the can re2e27er. he areaactuall occupied 7 each respondent fa2il differs, ran+in+ in si@e fro2 appro8i2atel * to 's6uare 2eters. Petitioners are the onl descendants not occupin+ an portion of the Propert.

/ost respondents, specificall Narciso, Rodolfo, Pastor


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pinatutunaan n+ pa+0a0atan++ap n+ nasa7in+ hala+a na 7uon+ 0asiahan n+ a0in+ 0aloo7an aa0in+ IPINA#-I5I, ISINA5IN A INI5IPA sa nasa7in+, ENRIM9EA 5OPEK, sa 0anan+ 2+ata+apa+2ana at 0ahalili, an+ 0a7uuan+ su0at n+ lupan+ na7an++it sa itaas nito sa pa2a2a+itan n+7ilihan+ walan+ ano2an+ pasu7ali. An+ lupan+ ito a walan+ 0asa2a at hindi tani2an n+ pala o2ais.

Si2ula sa araw na ito a a0in+ ililipat an+ pa+2a2a"ari at pa+tatan+0ili0 n+ nasa7in+ lupa 0aENRIM9EA 5OPEK sa 0anilan+B0anan+ ta+apa+2ana at 0ahalili 8 8 8.

he Cler0 of Court of the Re+ional rial Court of /anila certified on 1


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Since the other respondents had entered into a co2pro2ise a+ree2ent with petitioners, thedispositive portion of the trial court:s decision was directed a+ainst the


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T=istor of this case tells us that ori+inall the propert was owned 7


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On *3

. =E=ER =E A55E#ED SA5E IS $A5ID AND -INDS =E O=ER CO"=EIRS>

%. =E=ER PRESCRIPION APP5IES A#AINS =E S=ARE OPEIIONERS.*1

he funda2ental 6uestion for resolution is whether petitioners were a7le to prove, 7 the re6uisite6uantu2 of evidence, that /anon+son+ is a co"owner of the Propert and therefore entitled tode2and for its partition.

he Rulin+ of the Court

he petition lac0s 2erit.

he issues raised 7 petitioners are 2ainl factual in nature. In +eneral, onl 6uestions of law areappeala7le to this Court under Rule ). =owever, where the factual findin+s of the trial court andCourt of Appeals conflict, this Court has the authorit to review and, if necessar, reverse thefindin+s of fact of the lower courts.**his is precisel the situation in this case.

e review the factual and le+al issues of this case in li+ht of the +eneral rules of evidence and the7urden of proof in civil cases, as e8plained 7 this Court in at7otto2, it 2eans pro7a7ilit of truth.

=hether the Co!rt of Appeals erred in affirming the validit of theGasulatan sa -ilihan n+ 5upa
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Petitioners anchor their action for partition on the clai2 that /anon+son+ is a co"owner or co"heir ofthe Propert 7 inheritance, 2ore specificall, as the heir of her father, $icente 5ope@. Petitionersli0ewise alle+e that the Propert ori+inall 7elon+ed to #uevarra, and that $icente 5ope@ inheritedfro2 #uevarra a 1B interest in the Propert. As the parties clai2in+ the affir2ative of these issues,petitioners had the 7urden of proof to esta7lish their case 7 preponderance of evidence.

o trace the ownership of the Propert, 7oth contendin+ parties presented ta8 declarations and thetesti2onies of witnesses. =owever, the


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=hether the Co!rt of Appeals erred in not admitting the doc!ments presented b petitioners for thefirst time on appeal

e find no error in the Court of Appeals: refusal to +ive an pro7ative value to the alle+ed 7irthcertificate of #uevarra and the affidavit of -en;a2in dela Cru@, Sr. Petitioners 7elatedl attachedthese docu2ents to their appellee:s 7rief. Petitioners could easil have offered these docu2ents

durin+ the proceedin+s 7efore the trial court. Instead, petitioners presented these docu2ents for thefirst ti2e on appeal without an e8planation. or reasons of their own, petitioners did not for2alloffer in evidence these docu2ents 7efore the trial court as re6uired 7 Section (), Rule 1(* of theRules of Court.((o ad2it these docu2ents now is contrar to due process, as it deprivesrespondents of the opportunit to e8a2ine and controvert the2.

/oreover, even if these docu2ents were ad2itted, the would not controvert Navarro:s ownership ofthe Propert. -en;a2in dela Cru@, Sr.:s affidavit stated 2erel that, althou+h he 0new Navarro 7na2e, he was not personall ac6uainted with her.()#uevarra:s alle+ed 7irth certificate casts dou7tonl as to whether Navarro was indeed the 2other of #uevarra. hese docu2ents do not prove that#uevarra owned the Propert or that Navarro did not own the Propert.

Petitioners ad2itted 7efore the trial court that Navarro was the 2other of #uevarra. =owever,petitioners denied 7efore the Court of Appeals that Navarro was the 2other of #uevarra. e a+reewith the appellate court that this constitutes an i2per2issi7le chan+e of theor. hen a part adoptsa certain theor in the court 7elow, he cannot chan+e his theor on appeal. o allow hi2 to do so isnot onl unfair to the other part, it is also offensive to the 7asic rules of fair pla, ;ustice and dueprocess.(

If Navarro were not the 2other of #uevarra, it would onl further under2ine petitioners: case. A7sentan hereditar relationship 7etween #uevarra and Navarro, the Propert would not have passedfro2 Navarro to #uevarra, and then to the latter:s children, includin+ petitioners, 7 succession.here would then 7e no 7asis for petitioners: clai2 of co"ownership 7 virtue of inheritance fro2#uevarra. On the other hand, this would not under2ine respondents: position since the anchor theirclai2 on the sale under the Gasulatan and not on inheritance fro2 #uevarra.

Since the notari@ed Gasulatan is evidence of +reater wei+ht which petitioners failed to refute 7 clearand convincin+ evidence, this Court holds that petitioners were not a7le to prove 7 preponderanceof evidence that the Propert 7elon+ed to #uevarra:s estate. here is therefore no le+al 7asis forpetitioners: co2plaint for partition of the Propert.

;8EREFORE, the Decision of *%


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MEN$O/A, J.:

his is a petition for review of the decision,1dated April 3, 1&&4, of the Court of Appeals whichreversed the decision of the Re+ional rial Court, -ranch 1(, Pasi+ Cit dis2issin+ the co2plaint7rou+ht 7 respondents a+ainst petitioner for enforce2ent of a contract of sale.

he facts are not in dispute.

Petitioner San /i+uel Properties Philippines, Inc. is a do2estic corporation en+a+ed in the purchaseand sale of real properties. Part of its inventor are two parcels of land totallin+ 1, 4(3 s6uare 2etersat the corner of /eralco Avenue and #eneral Capinpin Street, -arrio Oran7o, Pasi+ Cit, which arecovered 7 C Nos. P"3*(& and P"3*(&% of the Re+ister of Deeds of Pasi+ Cit.

On e7ruar *1, 1&&), the properties were offered for sale for P*,1)','''.'' in cash. he offerwas 2ade to Att. =elena /. Dau@ who was actin+ for respondent spouses as undisclosedprincipals. In a letter*dated /arch *), 1&&), Att. Dau@ si+nified her clients: interest in purchasin+the properties for the a2ount for which the were offered 7 petitioner, under the followin+ ter2s? thesu2 of P'','''.'' would 7e +iven as earnest 2one and the 7alance would 7e paid in ei+ht e6ual

2onthl install2ents fro2 /a to Dece27er, 1&&). =owever, petitioner refused the counter"offer.

On /arch *&, 1&&), Att. Dau@ wrote another letter(proposin+ the followin+ ter2s for the purchaseof the properties, vi?

his is to e8press our interest to 7u our"a7ove"2entioned propert with an area of 1, 4(3 s6.2eters. or this purpose, we are enclosin+ herewith the su2 of P1,''','''.'' representin+ earnest"deposit 2one, su7;ect to the followin+ conditions.

1. e will 7e +iven the e8clusive option to purchase the propert within the (' dasfro2 date of our acceptance of this offer.

*. Durin+ said period, we will ne+otiate on the ter2s and conditions of the purchase>S/PPI will secure the necessar /ana+e2ent and -oard approvals> and we initiatethe docu2entation if there is 2utual a+ree2ent 7etween us.

(. In the event that we do not co2e to an a+ree2ent on this transaction, the saida2ount of P1,''','''.'' shall 7e refunda7le to us in full upon de2and. . . .

Isidro A. So7recare, petitioner:s vice"president and operations 2ana+er for corporate real estate,indicated his confor2it to the offer 7 affi8in+ his si+nature to the letter and accepted the earnest"deposit of P1 2illion. 9pon re6uest of respondent spouses, So7recare ordered the re2oval of theOR SA5E si+n fro2 the properties.

Att. Dau@ and So7recare then co22enced ne+otiations. Durin+ their 2eetin+ on April 3, 1&&),So7recare infor2ed Att. Dau@ that petitioner was willin+ to sell the su7;ect properties on a &'"dater2. Att. Dau@ countered with an offer of si8 2onths within which to pa.

On April 1), 1&&), the parties a+ain 2et durin+ which So7recare infor2ed Att. Dau@ that petitionerhad not et acted on her counter"offer. his pro2pted Att. Dau@ to propose a four"2onth period ofa2orti@ation.
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On April *, 1&&), Att. Dau@ as0ed for an e8tension of ) das fro2 April *&, 1&&) to


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In holdin+ that there is a perfected contract of sale, the Court of Appeals relied on the followin+findin+s? 1! earnest 2one was alle+edl +iven 7 respondents and accepted 7 petitioner throu+hits vice"president and operations 2ana+er, Isidro A. So7recare> and *! the docu2entar evidencein the records show that there was a perfected contract of sale.

ith re+ard to the alle+ed pa2ent and acceptance of earnest 2one, the Court holds that

respondents did not +ive the P1 2illion as earnest 2one as provided 7 Art. 1)3* of the CivilCode. he presented the a2ount 2erel as a deposit of what would eventuall 7eco2e the earnest2one or downpa2ent should a contract of sale 7e 2ade 7 the2. he a2ount was thus +iven notas a part of the purchase price and as proof of the perfection of the contract of sale 7ut onl as a+uarantee that respondents would not 7ac0 out of the sale. Respondents in fact descri7ed thea2ount as an earnest"deposit. In Spo!ses @oromal Sr. v. Co!rt of Appeals,&it was held?

. . . hile the P,''' 2i+ht have indeed 7een paid to Carlos in Octo7er, 1&%4, there is nothin+ toshow that the sa2e was in the concept of the earnest 2one conte2plated in Art. 1)3* of the CivilCode, invo0ed 7 petitioner, as si+nifin+ perfection of the sale. $iewed in the 7ac0drop of thefactual 2ilieu thereof e8tant in the record, e are 2ore inclined to 7elieve that the said P ,'''.''were paid in the concept of earnest 2one as the ter2 was understood under the Old Civil Code,

that is, as a +uarantee that the 7uer would not 7ac0 out, considerin+ that it is not clear that therewas alread a definite a+ree2ent as to the price then and that petitioners were decided to 7u %B4onl of the propert should respondent *! that durin+ the option period,the parties would ne+otiate the ter2s and conditions of the purchase> and (! petitioner wouldsecure the necessar approvals while respondents would handle the docu2entation.

he first condition for an option period of (' das sufficientl shows that a sale was never perfected.1>wphi1

As petitioner correctl points out, acceptance of this condition did not +ive rise to a perfected sale7ut 2erel to an option or an accepted unilateral pro2ise on the part of respondents to 7u thesu7;ect properties within (' das fro2 the date of acceptance of the offer. Such option +ivin+respondents the e8clusive ri+ht to 7u the properties within the period a+reed upon is separate anddistinct fro2 the contract of sale which the parties 2a enter.11All that respondents had was ;ust theoption to 7u the properties which privile+e was not, however, e8ercised 7 the2 7ecause there wasa failure to a+ree on the ter2s of pa2ent. No contract of sale 2a thus 7e enforced 7respondents.

urther2ore, even the option secured 7 respondents fro2 petitioner was fatall defective. 9nderthe second para+raph of Art. 1)4&, an accepted unilateral pro2ise to 7u or sell a deter2inate thin+for a price certain is 7indin+ upon the pro2isor onl if the pro2ise is supported 7 a distinct

consideration. Consideration in an option contract 2a 7e anthin+ of value, unli0e in sale where it2ust 7e the price certain in 2one or its e6uivalent. here is no showin+ here of an considerationfor the option. 5ac0in+ an proof of such consideration, the option is unenforcea7le.

E6uall co2pellin+ as proof of the a7sence of a perfected sale is the second condition that, durin+the option period, the parties would ne+otiate the ter2s and conditions of the purchase. he sta+esof a contract of sale are as follows? 1! negotiation, coverin+ the period fro2 the ti2e the prospectivecontractin+ parties indicate interest in the contract to the ti2e the contract is perfected> *!

perfection, which ta0es place upon the concurrence of the essential ele2ents of the sale which are
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the 2eetin+ of the 2inds of the parties as to the o7;ect of the contract and upon the price> and (!cons!mmation, which 7e+ins when the parties perfor2 their respective underta0in+s under thecontract of sale, cul2inatin+ in the e8tin+uish2ent thereof.1*In the present case, the parties never+ot past the ne+otiation sta+e. he alle+ed indu7ita7le evidence1(of a perfected sale cited 7 theappellate court was nothin+ 2ore than offers and counter"offers which did not a2ount to an finalarran+e2ent containin+ the essential ele2ents of a contract of sale. hile the parties alread

a+reed on the real properties which were the o7;ects of the sale and on the purchase price, the factre2ains that the failed to arrive at 2utuall accepta7le ter2s of pa2ent, despite the )"dae8tension +iven 7 petitioner.

he appellate court opined that the failure to a+ree on the ter2s of pa2ent was no 7ar to theperfection of the sale 7ecause Art. 1)4 onl re6uires a+ree2ent 7 the parties as to the price of theo7;ect. his is error. In avarro v. S!gar Prod!cers Cooperative Mareting Association 0nc.,1)we laiddown the rule that the 2anner of pa2ent of the purchase price is an essential ele2ent 7efore avalid and 7indin+ contract of sale can e8ist. Althou+h the Civil Code does not e8pressl state that the2inds of the parties 2ust also 2eet on the ter2s or 2anner of pa2ent of the price, the sa2e isneeded, otherwise there is no sale. As held in /oota Shaw 0nc. v. Co!rt of Appeals,1a+ree2ent onthe 2anner of pa2ent +oes into the price such that a disa+ree2ent on the 2anner of pa2ent istanta2ount to a failure to a+ree on the price.1%In 8elasco v. Co!rt of Appeals,14the parties to aproposed sale had alread a+reed on the o7;ect of sale and on the purchase price. - the 7uer:sown ad2ission, however, the parties still had to a+ree on how and when the downpa2ent and theinstall2ents were to 7e paid. It was held?

. . . Such 7ein+ the situation, it can not, therefore, 7e said that a definite and fir2 sales a+ree2ent7etween the parties had 7een perfected over the lot in 6uestion. Indeed, this Court has alread ruled7efore that a definite a+ree2ent on the 2anner of pa2ent of the purchase price is an essentialele2ent in the for2ation of a 7indin+ and enforcea7le contract of sale. he fact, therefore, that thepetitioners delivered to the respondent the su2 of P1',''' as part of the down"pa2ent that thehad to pa cannot 7e considered as sufficient proof of the perfection of an purchase and salea+ree2ent 7etween the parties herein under Art. 1)3* of the new Civil Code, as the petitionersthe2selves ad2it that so2e essential 2atter " the ter2s of the pa2ent " still had to 7e 2utuall

covenanted.13

hus, it is not the +ivin+ of earnest 2one, 7ut the proof of the concurrence of all the essentialele2ents of the contract of sale which esta7lishes the e8istence of a perfected sale.

In the a7sence of a perfected contract of sale, it is i22aterial whether Isidro A. So7recare had theauthorit to enter into a contract of sale in 7ehalf of petitioner. his issue, therefore, needs no furtherdiscussion.

;8EREFORE, the decision of the Court of Appeals is RE$ERSED and respondents: co2plaint isDIS/ISSED.

SO OR$ERE$.

G.R. No. 112212 Mar% 2, 199#

GREGORIO F'LE, petitioner,vs.O'RT OF APPEALS, NINE


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ROMERO, J.:

his petition for review on certiorari6uestions the affir2ance 7 the Court of Appeals of the decision1of the Re+ional rial Court of San Pa7lo Cit, -ranch (', dis2issin+ the co2plaint that praed for

the nullification of a contract of sale of a 1'"hectare propert in ana, Ri@al in consideration of thea2ount of P)','''.'' and a *. carat e2erald"cut dia2ond Civil Case No. SP"*)!. he lowercourts decision disposed of the case as follows?

=EREORE, pre2ises considered, the Court here7 renders ;ud+2entdis2issin+ the co2plaint for lac0 of 2erit and orderin+ plaintiff to pa?

1. Defendant Dra. Ninevetch /. Cru@ the su2 of P('','''.'' as and for2oral da2a+es and the su2 of P1'','''.'' as and for e8e2plar da2a+es>

*. Defendant Att.

(. Defendant Dra. Cru@ and Att. -elar2ino the su2 of P*,'''.'' each asand for attornes fees and liti+ation e8penses> and

). he costs of suit.

SO ORDERED.

As found 7 the Court of Appeals and the lower court, the antecedent facts of this case are asfollows?

Petitioner #re+orio ule, a 7an0er 7 profession and a ;eweler at the sa2e ti2e, ac6uired a 1'"

hectare propert in ana, Ri@al hereinafter ana propert!, covered 7 ransfer Certificate ofitle No. (*'4* which used to 7e under the na2e of r. Antonio


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found out that no sale or 7arter was feasi7le 7ecause the one"ear period for rede2ption of the saidpropert had not et e8pired at the ti2e.

In an effort to cut throu+h an le+al i2pedi2ent, petitioner e8ecuted on Octo7er 1&, 1&3), a deed ofrede2ption on 7ehalf of r.


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e8perience re+ardin+ ;ewelr. Petitioner nonetheless too0 7ac0 the 9S(''.'' and ;ewelr he had+iven the2.

hereafter, the +roup decided to +o to the house of a certain /acario Di2au+a, a ;eweler, to havethe earrin+s tested. Di2au+a, after ta0in+ one loo0 at the earrin+s, i22ediatel declared the2counterfeit. At around &?(' p.2., petitioner went to one Att. Renaldo Alcantara residin+ at 5a0eside

Su7division in San Pa7lo Cit, co2plainin+ a7out the fa0e ;ewelr. 9pon 7ein+ advised 7 the latter,petitioner reported the 2atter to the police station where Dichoso and /endo@a li0ewise e8ecutedsworn state2ents.

On Octo7er *%, 1&3), petitioner filed a co2plaint 7efore the Re+ional rial Court of San Pa7lo Cita+ainst private respondents prain+, a2on+ other thin+s, that the contract of sale over the anapropert 7e declared null and void on the +round of fraud and deceit.

On Octo7er (', 1&3), the lower court issued a te2porar restrainin+ order directin+ the Re+ister ofDeeds of Ri@al to refrain fro2 actin+ on the pertinent docu2ents involved in the transaction. OnNove27er *', 1&3), however, the sa2e court lifted its previous order and denied the praer for awrit of preli2inar in;unction.

After trial, the lower court rendered its decision on /arch 4, 1&3&. Confrontin+ the issue of whetheror not the +enuine pair of earrin+s used as consideration for the sale was delivered 7 Dr. Cru@ topetitioner, the lower court said?

he Court finds that the answer is definitel in the affir2ative. Indeed, Dra.Cru@ delivered the! su7;ect ;ewelries sic! into the hands of plaintiff who evenraised the sa2e nearer to the li+hts of the lo77 of the 7an0 near the door.hen as0ed 7 Dra. Cru@ if everthin+ was in order, plaintiff even nodded hissatisfaction =earin+ of e7. *), 1&33!. At that instance, plaintiff did notprotest, co2plain or 7e+ for additional ti2e to e8a2ine further the ;ewelriessic!. -ein+ a professional 7an0er and en+a+ed in the ;ewelr 7usinessplaintiff is conversant and co2petent to detect a fa0e dia2ond fro2 the realthin+. Plaintiff was accorded the reasona7le ti2e and opportunit to ascertainand inspect the ;ewelries sic! in accordance with Article 13) of the CivilCode. Plaintiff too0 deliver of the su7;ect ;ewelries sic! 7efore %?'' p.2. ofOcto7er *), 1&3). hen he went at 3?'' p.2. that sa2e da to the residenceof Att. -elar2ino alread with a tester co2plainin+ a7out so2e fa0e;ewelries sic!, there was alread undue dela 7ecause of the lapse of aconsidera7le len+th of ti2e since he +ot hold of su7;ect ;ewelries sic!. helapse of two *! hours 2ore or less 7efore plaintiff co2plained is considered7 the Court as unreasona7le dela.

he lower court further ruled that all the ele2ents of a valid contract under Article 1)3 of the CivilCode were present, na2el? a! consent or 2eetin+ of the 2inds> 7! deter2inate su7;ect 2atter,

and c! price certain in 2one or its e6uivalent. he sa2e ele2ents, accordin+ to the lower court,were present despite the fact that the a+ree2ent 7etween petitioner and Dr. Cru@ was principall a7arter contract. he lower court e8plained thus?

. . . . Plaintiffs ownership over the ana propert passed unto Dra. Cru@upon the constructive deliver thereof 7 virtue of the Deed of A7solute SaleE8h. D!. On the other hand, the ownership of Dra. Cru@ over the su7;ect;ewelries sic! transferred to the plaintiff upon her actual personal deliver tohi2 at the lo77 of the Prudential -an0. It is e8pressl provided 7 law that
http://www.lawphil.net/judjuris/juri1998/mar1998/gr_112212_1998.html#fnt3http://www.lawphil.net/judjuris/juri1998/mar1998/gr_112212_1998.html#fnt3


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the thin+ sold shall 7e understood as delivered, when it is placed in thecontrol and possession of the vendee Art. 1)&4, Civil Code> Guen@le Straffvs. atson Co. 1( Phil. *%!. he ownership andBor title over the ;ewelriessic! was trans2itted i22ediatel 7efore %?'' p.2. of Octo7er *), 1&3).Plaintiff si+nified his approval 7 noddin+ his head. Deliver or tradition, isone of the 2odes of ac6uirin+ ownership Art. 41*, Civil Code!.

Si2ilarl, when E8hi7it D was e8ecuted, it was e6uivalent to the deliver ofthe ana propert in favor of Dra. Cru@. he e8ecution of the pu7licinstru2ent E8h. D! operates as a for2al or s27olic deliver of the anapropert and authori@es the 7uer, Dra. Cru@ to use the docu2ent as proof ofownership lorendo v. o@, *' Phil. (&&!. /ore so, since E8hi7it D does notcontain an proviso or stipulation to the effect that title to the propert isreserved with the vendor until full pa2ent of the purchase price, nor is therea stipulation +ivin+ the vendor the ri+ht to unilaterall rescind the contract the2o2ent the vendee fails to pa within a fi8ed period a+u7a v. $da. De5eon, 1(* SCRA 4**> 5u@on -ro0era+e Co. Inc. vs. /ariti2e -uildin+ Co.Inc. 3% SCRA ('> roilan v. Pan Oriental Shippin+ Co. et al. 1* SCRA *4%!.4

Aside fro2 concludin+ that the contract of 7arter or sale had in fact 7een consu22ated whenpetitioner and Dr. Cru@ parted was at the 7an0, the trial court li0ewise dwelt on the une8plaineddela with which petit ioner co2plained a7out the alle+ed fa0er. hus?

. . . . $eril, plaintiff is alread estopped to co2e 7ac0 after the lapse ofconsidera7le len+th of ti2e to clai2 that what he +ot was fa0e. =e is a-usiness /ana+e2ent +raduate of 5a Salle 9niversit, Class 1&43"4&, aprofessional 7an0er as well as a ;eweler in his own ri+ht. wo hours is 2orethan enou+h ti2e to 2a0e a switch of a Russian dia2ond with the realdia2ond. It 2ust 7e re2e27ered that in


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9S(''.'' and ;ewelries sic! fro2 his a+ents. -ut he was not satisfied in7ein+ a7le to +et su7;ect ;ewelries for a son+. =e had to file a 2alicious andunfounded case a+ainst Dra. Cru@ and Att. -elar2ino who are well 0nown,respected and held in hi+h estee2 in San Pa7lo Cit where ever7odpracticall 0nows ever7od. Plaintiff ca2e to Court with unclean handsdra++in+ the defendants and soilin+ their clean and +ood na2e in the

process. -oth of the2 are near the twili+ht of their lives after 2aintainin+ andnurturin+ their +ood reputation in the co22unit onl to 7e stunned with acourt case. Since the filin+ of this case on Octo7er *%, 1&3) up to the presentthe were livin+ under a pall of dou7t. Surel, this affected not onl theirearnin+ capacit in their practice of their respective professions, 7ut also thesuffered 7es2irched reputations. Dra. Cru

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