sales (1).rtf

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1.contract of sale

VOL. 517, FEBRUARY 28, 2007

57

Serrano vs. a!"#at

$.R. %o. 1&'17&. Fe(r"ar) 28, 2007.*

S+OUSES O%%E SERRA%O A%- A+ARO /ERRERA, et#t#oners, vs. $O-OFRE-O A$UA,resonent.

Aeals3 4e f#n#n!s of fact of t4e loer co"rts are ent#tle to !reat e#!4t an s4o"l not (e#st"r(e e6cet for co!ent reasons.$enerall), t4e f#n#n!s of fact of t4e loer co"rts areent#tle to !reat e#!4t an s4o"l not (e #st"r(e e6cet for co!ent reasons. nee, t4e)s4o"l not (e c4an!e on aeal #n t4e a(sence of a clear s4o#n! t4at t4e tr#al co"rtoverlooe, #sre!are, or 9#s#nterrete so9e facts of e#!4t an s#!n#f#cance, 4#c4 #fcons#ere

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* FRS -VSO%.

58

58

SU+REE OUR RE+ORS A%%OAE-

Serrano vs. a!"#at

o"l 4ave altere t4e res"lt of t4e case. n t4e resent case, e f#n t4at (ot4 t4e tr#al co"rtan t4e o"rt of Aeals #nterrete so9e s#!n#f#cant facts res"lt#n! #n an erroneo"sresol"t#on of t4e #ss"e #nvolve.

ontracts3 Sta!es.n San #!"el +roert#es +4#l##nes, nc. v. So"ses /"an!, &&; SRA 7&7<2000=, e 4el t4at t4e sta!es of a contract of sale are> <1= ne!ot#at#on, cover#n! t4e er#ofro9 t4e t#9e t4e rosect#ve contract#n! art#es #n#cate #nterest #n t4e contract to t4e t#9et4e contract #s erfecte3 <2= erfect#on, 4#c4 taes lace "on t4e conc"rrence of t4eessent#al ele9ents of t4e sale, 4#c4 #s t4e 9eet#n! of t4e 9#ns of t4e art#es as to t4eo(?ect of t4e contract an "on t4e r#ce3 an <&= cons"99at#on, 4#c4 (e!#ns 4en t4e

art#es erfor9 t4e#r resect#ve "nerta#n!s "ner t4e contract of sale, c"l9#nat#n! #n t4ee6t#n!"#s49ent t4ereof.

Sa9e3 Sales3 @ors an +4rases3 ontract of Sale, an ontract to Sell, -#st#n!"#s4e3 Acontract to sell #s a#n to a con#t#onal sale 4ere t4e eff#cac) or o(l#!ator) force of t4evenorCs o(l#!at#on to transfer t#tle #s s"(or#nate to t4e 4aen#n! of a f"t"re an "ncerta#nevent, so t4at #f t4e s"sens#ve con#t#onal o(l#!at#on oes not tae lace, t4e art#es o"lstan as #f t4e con#t#onal o(l#!at#on 4a never e6#ste.A contract to sell #s a#n to acon#t#onal sale 4ere t4e eff#cac) or o(l#!ator) force of t4e venorCs o(l#!at#on to transfert#tle #s s"(or#nate to t4e 4aen#n! of a f"t"re an "ncerta#n event, so t4at #f t4e

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s"sens#ve con#t#on oes not tae lace, t4e art#es o"l stan as #f t4e con#t#onalo(l#!at#on 4a never e6#ste. 4e s"sens#ve con#t#on #s co99onl) f"ll a)9ent of t4e"rc4ase r#ce. 4e #fferences (eteen a contract to sell an a contract of sale are ellDsettle #n ?"r#sr"ence. As earl) as 1'51, #n S#n! Yee v. Santos, 7 O.$. ;&72 <1'51=, e 4elt4at> 6 6 6 aG #st#nct#on 9"st (e 9ae (eteen a contract of sale #n 4#c4 t#tle asses to t4e(")er "on el#ver) of t4e t4#n! sol an a contract to sell 6 6 6 4ere () a!ree9ent t4eoners4# #s reserve #n t4e seller an #s not to ass "nt#l t4e f"ll a)9ent, of t4e "rc4ase

r#ce #s 9ae. n t4e f#rst case, nonDa)9ent of t4e r#ce #s a ne!at#ve resol"tor) con#t#on3 #nt4e secon case, f"ll a)9ent #s a os#t#ve s"sens#ve con#t#on. Be#n! contrar#es, t4e#r effect#n la cannot (e #ent#cal. n t4e f#rst case, t4e venor 4as lost an cannot recover t4eoners4# of t4e lan sol "nt#l an "nless t4e contract of sale #s #tself resolve an set as#e.n t4e secon case, 4oever, t4e t#tle


Serrano vs. a!"#at

re9a#ns #n t4e venor #f t4e venee oes not co9l) #t4 t4e con#t#on receent of 9a#n!a)9ent at t4e t#9e sec#f#e #n t4e contract.

Sa9e3 Sa9e3 Earnest one)3 4e earnest 9one) for9s art of t4e cons#erat#on onl) #f t4esale #s cons"99ate "on f"ll a)9ent of t4e "rc4ase r#ce.t #s tr"e t4at Art#cle 182 oft4e #v#l oe rov#es t4at @4enever earnest 9one) #s !#ven #n a contract of sale, #t s4all (econs#ere as art of t4e r#ce an roof of t4e erfect#on of t4e contract. /oever, t4#sart#cle seas of earnest 9one) !#ven #n a contract of sale. n t4#s case, t4e earnest 9one)as !#ven #n a contract to sell. 4e earnest 9one) for9s art of t4e cons#erat#on onl) #f t4esale #s cons"99ate "on f"ll a)9ent of t4e "rc4ase r#ce. %o, s#nce t4e earnest 9one)as !#ven #n a contract to sell, Art#cle 182, 4#c4 seas of a contract of sale, oes not al).

+EO% for rev#e on cert#orar# of t4e ec#s#on an resol"t#on of t4e o"rt of Aeals.

4e facts are state #n t4e o#n#on of t4e o"rt.

LoeH an Re9#llo La Off#ce for et#t#oners.

Rafael Sol#ven an %elson A. Lo)ola for r#vate resonent.

SA%-OVALD$UERREI, J.>

Before "s #s a et#t#on for rev#e on cert#orar# "ner R"le 5 of t4e 1''7 R"les of #v#l+roce"re, as a9ene, assa#l#n! t4e -ec#s#on1 of t4e o"rt of Aeals ate Jan"ar) 2',1''' an #ts Resol"t#on ate J"l) 1, 1''' #n AD$.R. V %o. 882.

So"ses Onn#e an A9aro /errera, et#t#oners, are t4e re!#stere oners of a lot locate #nLas +#Kas, etro an#la covere () ransfer ert#f#cate of #tle %o. D''05.

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1 +enne () Assoc#ate J"st#ce onc4#ta ar#oDorales <no a 9e9(er of t4#s o"rt= anconc"rre #n () Assoc#ate J"st#ce Ja#nal -. Ras"l an Assoc#ate J"st#ce Bernaro +. A(esa9#s<(ot4 ret#re=.

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Serrano vs. a!"#at

So9et#9e #n arc4 1''0, $oofreo a!"#at, resonent, offere to (") t4e lot. +et#t#onersa!ree to sell #t at +1,500.00 er s"are 9eter. Resonent t4en !ave et#t#oners +100,000.00as art#al a)9ent. n t"rn, et#t#oners !ave resonent t4e correson#n! rece#t stat#n!t4at resonent ro9#se to a) t4e (alance of t4e "rc4ase r#ce on or (efore arc4 2&,1''0, t4"s>

Las +#Kas, etro an#la

arc4 1', 1''0

REE+ FOR +ARAL +AYE% OF LO %O. 2& OVERE- BY %O. D''05, LAS +MAS,ERO A%LA REEVE- FRO R. $O-OFRE-O A$UA /E AOU% OF O%E /U%-RE-/OUSA%- +ESOS <+100,000.00= AS +ARAL +AYE% OF OUR LO SUAE- % LAS +MAS,.. OVERE- BY %O. D''05 A%- @/ A% AREA OF &' SNUARE EERS.

R. A$UA +ROSE- O +AY /E BALA%E OF /E +UR/ASE +RE O% OR BEFORE AR/2&, 1''0, A%- /A @E @LL EEUE A%- S$% /E F%AL -EE- OF SALE O% /S -AE.

S$%E- /S 1'/ -AY OF AR/, 1''0 A LAS +MAS, ..

<S$-= A+ARO /ERRERA <S$-= O%%E SERRA%O2

On arc4 28, 1''0, resonent, t4ro"!4 4#s co"nsel Att). +onc#ano Es#r#t", rote et#t#oners#nfor9#n! t4e9 of 4#s rea#ness to a) t4e (alance of t4e contract r#ce an re"est#n! t4e9to reare t4e f#nal ee of sale.&

On Ar#l , 1''0, et#t#oners, t4ro"!4 Att). R"(en V. LoeH, sent a letter to resonentstat#n! t4at et#t#oner A9aro /errera #s leav#n! for a(roa on or (efore Ar#l 15, 1''0 ant4at t4e) are cancel#n! t4e transact#on. +et#t#oners also

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2 E64#(#t B, Recors, . 12.

& E64#(#t -, #., . 125.

E64#(#t 2, #., . 17&.

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Serrano vs. a!"#at

#nfor9e resonent t4at 4e can recover t4e earnest 9one) of +100,000.00 an)t#9e.

A!a#n, on Ar#l ;, 1''0,5 et#t#oners rote resonent stat#n! t4at t4e) el#vere to 4#sco"nsel +4#l##ne %at#onal Ban ana!erCs 4ec %o. 7'05&7 ate Ar#l ;, 1''0 #n t4ea9o"nt of +100,000.00 a)a(le to 4#9.

n v#e of t4e cancellat#on of t4e contract () et#t#oners, resonent f#le #t4 t4e Re!#onalr#al o"rt, Branc4 ;&, aat# #t) a co9la#nt a!a#nst t4e9 for sec#f#c erfor9ance ana9a!es, ocete as #v#l ase %o. '0P10;7.;

On J"ne 27, 1'', after 4ear#n!, t4e tr#al co"rt renere #ts -ec#s#on7 f#n#n! t4ere as aerfecte contract of sale (eteen t4e art#es an orer#n! et#t#oners to e6ec"te a f#nal eeof sale #n favor of resonent. 4e tr#al co"rt 4el>

6 6 6

n t4e eval"at#on of t4e ev#ence resente () t4e art#es as to t4e #ss"e as to 4o as rea)to co9l) #t4 4#s o(l#!at#on on t4e ver(al a!ree9ent to sell on arc4 2&, 1''0, s4os t4atla#nt#ffCs os#t#on eserves 9ore e#!4t an cre#(#l#t). F#rst, t4e +100,000.00 t4at la#nt#ffa# 4et4er as ona)9ent or earnest 9one) s4oe t4at t4ere as alrea) a erfecte

contract. Art. 182 of t4e #v#l oe of t4e +4#l##nes, reas as follos, to #t>

QArt. 182. @4enever earnest 9one) #s !#ven #n a contract of sale, #t s4all (e cons#ere asart of t4e r#ce an as roof of t4e erfect#on of t4e contract.C

Secon, la#nt#ff as t4e f#rst to react to s4o 4#s ea!erness to "s4 t4ro"!4 #t4 t4e sale ()sen#n! efenants t4e letter ate arc4 25, 1''0. <E64. Q-C= an re#terate t4e sa9e #ntentto "rs"e t4e sale #n a letter ate Ar#l ;, 1''0. 4#r, la#nt#ff 4a t4e (alance of t4e"rc4ase r#ce rea) for a)9ent <E64. QC=. -efenantsC 9ere alle!at#on t4at #t as la#nt#ff4o # not a

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5 E64#(#t 5, Rollo, . 177.

; Recors, . 1P.

7 ., . 2&P&0.

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Serrano vs. a!"#at

ear on arc4 2&, 1''0 #s "nava#l#n!. -efenantsC letters <E64s. Q2C an Q5C= aear to (e 9ereaftert4o"!4t.

On aeal, t4e o"rt of Aeals, #n #ts assa#le -ec#s#on of Jan"ar) 2', 1''', aff#r9e t4e tr#alco"rtCs ?"!9ent. Fort4#t4, et#t#oners f#le t4e#r 9ot#on for recons#erat#on ("t #t asen#e () t4e aellate co"rt #n #ts Resol"t#on8 ate J"l) 1, 1'''.

/ence, t4e resent reco"rse.

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4e (as#c #ss"e to (e resolve #s 4et4er t4e oc"9ent ent#tle Rece#t for +art#al +a)9ents#!ne () (ot4 art#es earl#er 9ent#one #s a contract to sell or a contract of sale. +et#t#onersconten t4at t4e Rece#t #s not a erfecte contract of sale as rov#e for #n Art#cle 158' #nrelat#on to Art#cle 17510 of t4e #v#l oe. 4e el#ver) to t4e9 of +100,000.00 as ona)9ent cannot (e cons#ere as roof of t4e erfect#on of a contract of sale "ner Art#cle18211 of t4e sa9e oe s#nce t4ere as no clear a!ree9ent (eteen t4e art#es as to t4ea9o"nt of cons#erat#on.

$enerall), t4e f#n#n!s of fact of t4e loer co"rts are ent#tle to !reat e#!4t an s4o"l not(e #st"r(e e6cet for

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8 ., . 25.

' Art#cle 158. B) t4e contract of sale one of t4e contract#n! art#es o(l#!ates 4#9self totransfer t4e oners4# of an to el#ver a eter9#nate t4#n!, an t4e ot4er 4#9self to a)t4erefore a r#ce certa#n #n 9one) or #ts e"#valent.

A contract of sale 9a) (e a(sol"te or con#t#onal.

10 Art#cle 175. 4e contract of sale #s erfecte at t4e 9o9ent t4ere #s a 9eet#n! of t4e9#ns "on t4e t4#n! 4#c4 #s t4e o(?ect of t4e contract an "on t4e r#ce.

Fro9 t4at 9o9ent, t4e art#es 9a) rec#rocall) e9an erfor9ance, s"(?ect to t4erov#s#ons of t4e la !overn#n! t4e for9 of contracts.

11 Art#cle 182. @4enever earnest 9one) #s !#ven #n a contract of sale, #t s4all (e cons#ereas art of t4e r#ce an as roof of t4e erfect#on of t4e contract.

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Serrano vs. a!"#at

co!ent reasons. nee, t4e) s4o"l not (e c4an!e on aeal #n t4e a(sence of a clears4o#n! t4at t4e tr#al co"rt overlooe, #sre!are, or 9#s#nterrete so9e facts of e#!4tan s#!n#f#cance, 4#c4 #f cons#ere o"l 4ave altere t4e res"lt of t4e case.12 n t4eresent case, e f#n t4at (ot4 t4e tr#al co"rt an t4e o"rt of Aeals #nterrete so9es#!n#f#cant facts res"lt#n! #n an erroneo"s resol"t#on of t4e #ss"e #nvolve.

n 4ol#n! t4at t4ere #s a erfecte contract of sale, (ot4 co"rts 9a#nl) rel#e on t4e earnest9one) !#ven () resonent to et#t#oners. 4e) #nvoe Art#cle 182 of t4e #v#l oe 4#c4

rov#es t4at @4enever earnest 9one) #s !#ven #n a contract of sale, #t s4all (e cons#ere asart of t4e r#ce an as roof of t4e erfect#on of t4e contract.

@e are not conv#nce.

n San #!"el +roert#es +4#l##nes, nc. v. So"ses /"an!,1& e 4el t4at t4e sta!es of acontract of sale are> <1= ne!ot#at#on, cover#n! t4e er#o fro9 t4e t#9e t4e rosect#vecontract#n! art#es #n#cate #nterest #n t4e contract to t4e t#9e t4e contract #s erfecte3 <2=erfect#on, 4#c4 taes lace "on t4e conc"rrence of t4e essent#al ele9ents of t4e sale,4#c4 #s t4e 9eet#n! of t4e 9#ns of t4e art#es as to t4e o(?ect of t4e contract an "on t4er#ce3 an <&= cons"99at#on, 4#c4 (e!#ns 4en t4e art#es erfor9 t4e#r resect#ve

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"nerta#n!s "ner t4e contract of sale, c"l9#nat#n! #n t4e e6t#n!"#s49ent t4ereof.

@#t4 t4e a(ove ost"lates as !"#el#nes, e no rocee to eter9#ne t4e real nat"re of t4econtract entere #nto () t4e art#es.

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12 $a9al#el . V#llan"eva an rene . V#llan"eva v. o"rt of Aeals, So"ses Jose an Leon#la-ela r"H, an So"ses $"#o an Fel#c#tas +#le, $.R. %o. 107;2, Jan"ar) 28, 1''7, 2;7 SRA8'.

1& $.R. %o. 1&72'0, J"l) &1, 2000, &&; SRA 7&7, c#t#n! An! Y" As"nc#on v. o"rt of Aeals,2&8 SRA ;02 <1''=.

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Serrano vs. a!"#at

t #s a canon #n t4e #nterretat#on of contracts t4at t4e ors "se t4ere#n s4o"l (e !#vent4e#r nat"ral an or#nar) 9ean#n! "nless a tec4n#cal 9ean#n! as #ntene.1 4"s, 4enet#t#oners eclare #n t4e sa# Rece#t for +art#al +a)9ent t4at t4e)

REEVE- FRO R. $O-OFRE-O A$UA /E AOU% OF O%E /U%-RE- /OUSA%-+ESOS <+100,000.00= AS +ARAL +AYE% OF OUR LO SUAE- % LAS +MAS, ..OVERE- BY %O. D''05 A%- @/ A% AREA OF &' SNUARE EERS.

R. A$UA +ROSE- O +AY /E BALA%E OF /E +UR/ASE +RE O% OR BEFORE AR/2&, 1''0, A%- /A @E @LL EEUE A%- S$% /E F%AL -EE- OF SALE O% /S -AE.

t4ere can (e no ot4er #nterretat#on t4an t4at t4e) a!ree to a con#t#onal contract of sale,cons"99at#on of 4#c4 #s s"(?ect onl) to t4e f"ll a)9ent of t4e "rc4ase r#ce.

A contract to sell #s a#n to a con#t#onal sale 4ere t4e eff#cac) or o(l#!ator) force of t4evenorCs o(l#!at#on to transfer t#tle #s s"(or#nate to t4e 4aen#n! of a f"t"re an "ncerta#nevent, so t4at #f t4e s"sens#ve con#t#on oes not tae lace, t4e art#es o"l stan as #ft4e con#t#onal o(l#!at#on 4a never e6#ste. 4e s"sens#ve con#t#on #s co99onl) f"lla)9ent of t4e "rc4ase r#ce.15

4e #fferences (eteen a contract to sell an a contract of sale are ellDsettle #n ?"r#sr"ence. As earl) as 1'51, #n S#n! Yee v. Santos,1; e 4el t4at>

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1 an v. o"rt of Aeals, $.R. %o. 100'2, A"!"st 12, 1''2, 212 SRA 58;.

15 +4#l##ne %at#onal Ban v. o"rt of Aeals an LaaH a %!o, $.R. %o. 11'580,Sete9(er 2;, 1'';, 2;2 SRA ;, c#t#n! Rose +ac#n! o., nc. v. o"rt of Aeals, 1;7 SRA&0', &18 <1'88= an L#9 v. o"rt of Aeals, 182 SRA 5;, ;70 <1''0=, #t4 c#tat#ons.

1; 7 O.$. ;&72 <1'51=.

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Serrano vs. a!"#at

6 6 6 aG #st#nct#on 9"st (e 9ae (eteen a contract of sale #n 4#c4 t#tle asses to t4e(")er "on el#ver) of t4e t4#n! sol an a contract to sell 6 6 6 4ere () a!ree9ent t4eoners4# #s reserve #n t4e seller an #s not to ass "nt#l t4e f"ll a)9ent, of t4e "rc4aser#ce #s 9ae. n t4e f#rst case, nonDa)9ent of t4e r#ce #s a ne!at#ve resol"tor) con#t#on3 #nt4e secon case, f"ll a)9ent #s a os#t#ve s"sens#ve con#t#on. Be#n! contrar#es, t4e#r effect#n la cannot (e #ent#cal. n t4e f#rst case, t4e venor 4as lost an cannot recover t4eoners4# of t4e lan sol "nt#l an "nless t4e contract of sale #s #tself resolve an set as#e.n t4e secon case, 4oever, t4e t#tle re9a#ns #n t4e venor #f t4e venee oes not co9l)#t4 t4e con#t#on receent of 9a#n! a)9ent at t4e t#9e sec#f#e #n t4e contract.

n ot4er ors, #n a contract to sell, oners4# #s reta#ne () t4e seller an #s not to ass to

t4e (")er "nt#l f"ll a)9ent of t4e r#ce.17

n t4#s case, t4e Rece#t for +art#al +a)9ent s4os t4at t4e tr"e a!ree9ent (eteen t4eart#es #s a contract to sell.

F#rst, oners4# over t4e roert) as reta#ne () et#t#oners an as not to ass toresonent "nt#l f"ll a)9ent of t4e "rc4ase r#ce. 4"s, et#t#oners nee not "s4 t4ro"!4#t4 t4e sale s4o"l resonent fa#l to re9#t t4e (alance of t4e "rc4ase r#ce (efore t4eeal#ne on arc4 2&, 1''0. n effect, et#t#oners 4ave t4e r#!4t to resc#n "n#laterall) t4econtract t4e 9o9ent resonent fa#ls to a) #t4#n t4e f#6e er#o.18

Secon, t4e a!ree9ent (eteen t4e art#es as not e9(o#e #n a ee of sale. 4e a(senceof a for9al ee of conve)ance #s a stron! #n#cat#on t4at t4e art#es # not #nten #99e#atetransfer of oners4#, ("t onl) a transfer after f"ll a)9ent of t4e "rc4ase r#ce.1'

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17 ., c#t#n! Jac#nto v. aaraH, 20' SRA 2;, 25 <1''2=.

18 o9as . 4"a v. o"rt of Aeals an Encarnac#on Vales4o), $.R. %o. 11'255, Ar#l ',200&, 01 SRA 5.

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Serrano vs. a!"#at

4#r, et#t#oners reta#ne ossess#on of t4e cert#f#cate of t#tle of t4e lot. 4#s #s an a#t#onal#n#cat#on t4at t4e a!ree9ent # not transfer to resonent, e#t4er () act"al or constr"ct#veel#ver), oners4# of t4e roert).20

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t #s tr"e t4at Art#cle 182 of t4e #v#l oe rov#es t4at @4enever earnest 9one) #s !#ven #na contract of sale, #t s4all (e cons#ere as art of t4e r#ce an roof of t4e erfect#on of t4econtract. /oever, t4#s art#cle seas of earnest 9one) !#ven #n a contract of sale. n t4#scase, t4e earnest 9one) as !#ven #n a contract to sell. 4e earnest 9one) for9s art of t4econs#erat#on onl) #f t4e sale #s cons"99ate "on f"ll a)9ent of t4e "rc4ase r#ce.21 %o,s#nce t4e earnest 9one) as !#ven #n a contract to sell, Art#cle 182, 4#c4 seas of acontract of sale, oes not al).

As rev#o"sl) #sc"sse, t4e s"sens#ve con#t#on <a)9ent of t4e (alance () resonent= #not tae lace. learl), resonent cannot co9el et#t#oners to transfer oners4# of t4eroert) to 4#9.

@/EREFORE, e $RA% t4e #nstant +et#t#on for Rev#e. 4e c4allen!e -ec#s#on of t4e o"rtof Aeals #s REVERSE- an resonentCs co9la#nt #s -SSSE-.

SO OR-ERE-.

+"no <.J., 4a#rerson=, orona an $arc#a, JJ., conc"r.

AHc"na, J., On Off#c#al Leave.

+et#t#on !rante, c4allen!e ec#s#on reverse. o9la#nt #s9#sse.

%otes.Un#lateral cancellat#on of a contract to sell #s not arrante #f t4e (reac4 #s sl#!4t orcas"al. <S#sa -evelo9ent ororat#on vs. Off#ce of t4e +res#ent, 2&1 SRA ;7 1''G=

$.R. %o. 1;1&18.%ove9(er 25, 200'.*

JULE %ABUS,** /ELLE %ABUS** an BEY OLERO, et#t#oners, vs. JOANU% +ASO% an

JULA +ASO%, resonents.

#v#l La3 ontracts3 ontract of Sale3 ontract to Sell3 Sales3 -#st#nct#on (eteen a contract ofa(sol"te sale an a contract of con#t#onal sale.Ra9os v. /er"ela, 7& SRA 7' <2005=#fferent#ates a contract of a(sol"te sale an a contract of con#t#onal sale as follos> Art#cle158 of t4e #v#l oe rov#es t4at a contract of sale 9a) (e a(sol"te or con#t#onal. Acontract of sale #s a(sol"te 4en t#tle to t4e roert) asses to t4e venee "on el#ver) oft4e t4#n! sol. A ee of sale #s a(sol"te 4en t4ere #s no st#"lat#on #n t4e contract t4at t#tleto t4e roert) re9a#ns #t4 t4e seller "nt#l f"ll a)9ent of t4e "rc4ase r#ce. 4e sale #salso a(sol"te #f t4ere #s no st#"lat#on !#v#n! t4e venor t4e r#!4t to cancel "n#laterall) t4econtract t4e 9o9ent t4e venee fa#ls to a) #t4#n a f#6e er#o. n a con#t#onal sale, as #n acontract to sell, oners4# re9a#ns #t4 t4e venor an oes not ass to t4e venee "nt#l f"lla)9ent of t4e "rc4ase r#ce. 4e f"ll a)9ent of t4e "rc4ase r#ce artaes of as"sens#ve con#t#on, an nonDf"lf#ll9ent of t4e con#t#on revents t4e o(l#!at#on to sell fro9ar#s#n!.

Sa9e3 Sa9e3 Sa9e3 @4ere t4e venor ro9#ses to e6ec"te a ee of a(sol"te sale "on t4eco9let#on () t4e venee of t4e a)9ent of t4e r#ce, t4e contract #s onl) a contract to sell.t #s not t4e t#tle of t4e contract, ("t #ts e6ress ter9s or st#"lat#ons t4at eter9#ne t4e #nof contract entere #nto () t4e art#es. n t4#s case, t4e contract ent#tle -ee of on#t#onalSale #s act"all) a contract to sell. 4e contract st#"late t4at as soon as t4e f"llcons#erat#on of t4e sale 4as (een a# () t4e venee, t4e correson#n! transfer oc"9entss4all (e e6ec"te () t4e venor to t4e venee for t4e ort#on sol. @4ere t4e venorro9#ses to e6ec"te a ee of a(sol"te sale "on t4e co9let#on () t4e venee of t4ea)9ent of t4e r#ce, t4e contract #s onl) a contract to sell. 4e aforeD

8/14/2019 sales (1).rtf


:::::::::::::::

* /R- -VSO%.

** Referre to as %ABOS #n t4e R an A -ec#s#ons, an #n t4e lea#n!s.

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&&5

%a("s vs. +acson

c#te st#"lat#on s4os t4at t4e venors reserve t#tle to t4e s"(?ect roert) "nt#l f"lla)9ent of t4e "rc4ase r#ce.

Sa9e3 Sa9e3 Sa9e3 4e f"ll a)9ent of t4e "rc4ase r#ce #s t4e os#t#ve s"sens#vecon#t#on, t4e fa#l"re of 4#c4 #s not a (reac4 of contract ("t s#9l) an event t4at reventet4e o(l#!at#on of t4e venor to conve) t#tle fro9 ac"#r#n! (#n#n! force.Unfort"natel) fort4e So"ses +acson, s#nce t4e -ee of on#t#onal Sale e6ec"te #n t4e#r favor as 9erel) acontract to sell, t4e o(l#!at#on of t4e seller to sell (eco9es e9ana(le onl) "on t4e4aen#n! of t4e s"sens#ve con#t#on. 4e f"ll a)9ent of t4e "rc4ase r#ce #s t4e os#t#ves"sens#ve con#t#on, t4e fa#l"re of 4#c4 #s not a (reac4 of contract, ("t s#9l) an event t4atrevente t4e o(l#!at#on of t4e venor to conve) t#tle fro9 ac"#r#n! (#n#n! force. 4"s, for#ts nonDf"lf#l9ent, t4ere #s no contract to sea of, t4e o(l#!or 4av#n! fa#le to erfor9 t4es"sens#ve con#t#on 4#c4 enforces a ?"r##cal relat#on. @#t4 t4#s c#rc"9stance, t4ere can (eno resc#ss#on or f"lf#l9ent of an o(l#!at#on t4at #s st#ll nonDe6#stent, t4e s"sens#ve con#t#onnot 4av#n! occ"rre as )et. E94as#s s4o"l (e 9ae t4at t4e (reac4 conte9late #n Art#cle11'1 of t4e %e #v#l oe #s t4e o(l#!orCs fa#l"re to co9l) #t4 an o(l#!at#on alrea) e6tant,not a fa#l"re of a con#t#on to rener (#n#n! t4at o(l#!at#on.

Sa9e3 Sa9e3 -a9a!es3 Art#cle 2220 of t4e #v#l oe allos t4e recover) of 9oral a9a!es #n(reac4es of contract 4ere t4e efenant acte fra""lentl) or #n (a fa#t4.Resonents arenot ent#tle to 9oral a9a!es (eca"se contracts are not referre to #n Art#cle 221' of t4e #v#loe, 4#c4 en"9erates t4e cases 4en 9oral a9a!es 9a) (e recovere. Art#cle 2220 of t4e#v#l oe allos t4e recover) of 9oral a9a!es #n (reac4es of contract 4ere t4e efenantacte fra""lentl) or #n (a fa#t4. /oever, t4#s case #nvolves a contract to sell, 4ere#n f"lla)9ent of t4e "rc4ase r#ce #s a os#t#ve s"sens#ve con#t#on, t4e nonDf"lf#ll9ent of 4#c4#s not a (reac4 of contract, ("t 9erel) an event t4at revents t4e seller fro9 conve)#n! t#tleto t4e "rc4aser. S#nce t4ere #s no (reac4 of contract #n t4#s case, resonents are not ent#tleto 9oral a9a!es.

+EO% for rev#e on cert#orar# of a ec#s#on of t4e o"rt of Aeals.

&&;

&&;


%a("s vs. +acson


8/14/2019 sales (1).rtf


Rolano V. R#vera for et#t#oner.

-ante S. -av# for resonents.

+ERALA,J.>

4#s #s a et#t#on for rev#e on cert#orar# 1 of t4e -ec#s#on2 of t4e o"rt of Aeals #n AD$.R.

V %o. '1 ate %ove9(er 28, 200&. 4e o"rt of Aeals aff#r9e #t4 9o#f#cat#on t4e-ec#s#on of t4e Re!#onal r#al o"rt of La r#n#a, Ben!"et, Branc4 10, orer#n! et#t#onerBett) olero to e6ec"te a ee of a(sol"te sale #n favor of resonents, so"ses Joa"#n an J"l#a +acson, over t4e lots covere () ransfer ert#f#cate of #tle <= %os. D18;50 an D18;51 "on a)9ent to 4er () resonents of t4e s"9 of +57,5.8G reresent#n! t4e(alance "e for t4e f"ll a)9ent of t4e roert) s"(?ect of t4#s case3 an orer#n! et#t#onerBett) olero to s"rrener to resonents 4er onerCs "l#cate co) of %os. D18;50 anD18;51.

4e facts, as state () t4e tr#al co"rt,& are as follos>

4e so"ses Bate an J"l#e %a("s ere t4e oners of arcels of lan #t4 a total area of 1,;;5s"are 9eters, s#t"ate #n +#co, La r#n#a, Ben!"et, "l) re!#stere #n t4e#r na9es "ner %o. D';'7 of t4e Re!#ster of -ees of t4e +rov#nce of Ben!"et. 4e roert) as9ort!a!e () t4e So"ses %a("s to t4e +4#l##ne %at#onal Ban <+%B=, La r#n#a Branc4, to

sec"re a loan #n t4e a9o"nt of +&0,000.00.

:::::::::::::::

1 Uner R"le 5 of t4e R"les of o"rt.

2 +enne () Assoc#ate J"st#ce Ser!#o L. +estaKo, #t4 Assoc#ate J"st#ces ar#na L. B"Hon an Jose . enoHa, conc"rr#n!3 Rollo, . &8D&.

& A Rollo, . 20D2;.

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%a("s vs. +acson

On Fe(r"ar) 1', 1'77, t4e So"ses %a("s e6ec"te a -ee of on#t#onal Sale cover#n! 1,000s"are 9eters of t4e 1,;;5 s"are 9eters of lan #n favor of resonents So"ses +acson fora cons#erat#on of +170,000.00, 4#c4 as "l) notar#He on Fe(r"ar) 21, 1'77. 4econs#erat#on as to (e a#, t4"s>

/A, t4e cons#erat#on of t4e a9o"nt of +170,000.00 #ll (e a# () t4e VE%-EE 4ere#n #n9) favor #n t4e follo#n! 9anner>

a.4at t4e s"9 of +1&,000.00, 9ore or less, on or (efore Fe(r"ar) 21, 1'77 an 4#c4 a9o"nt#ll (e a# #rectl) to t4e +%B, La r#n#a Branc4, an 4#c4 #ll for9 art of t4e "rc4aser#ce3

(.4at after a)#n! t4e a(ove a9o"nt to t4e +%B, La r#n#a, Ben!"et (ranc4, a (alance ofa(o"t +17,500.00 re9a#ns as 9) 9ort!a!e (alance an t4#s a9o"nt #ll (e a# () t4eVE%-EE 4ere#n at t4e rate of not less t4an +&,000.00 a 9ont4 (e!#nn#n! arc4 1'77, "nt#l t4esa# 9ort!a!e (alance #s f"ll) l#"#ate, an t4at all a)9ents 9ae () t4e VE%-EE to t4e

8/14/2019 sales (1).rtf


+%B, La r#n#a, Ben!"et (ranc4, s4all for9 art of t4e cons#erat#on of t4#s sale3

c.4at, as soon as t4e 9ort!a!e o(l#!at#on #t4 t4e +%B as c#te a(ove #s f"ll) a#, t4en t4eVE%-EE 4ere#n 4ere() o(l#!ates 4#9self, 4#s 4e#rs an ass#!ns, to a) t4e a9o"nt of not lesst4an +2,000.00 a 9ont4 #n favor of t4e VE%-OR, 4#s 4e#rs an ass#!ns, "nt#l t4e f"ll a9o"nt of+170,000.00 #s f"ll) covere <#ncl"#n! t4e a)9ents c#te #n +ars. a an ( a(ove=3

/A, as soon as t4e f"ll cons#erat#on of t4#s sale 4as (een a# () t4e VE%-EE, t4ecorreson#n! transfer oc"9ents s4all (e e6ec"te () t4e VE%-OR to t4e VE%-EE for t4eort#on sol3

/A, t4e ort#on sol #s as s4on #n t4e s#9le setc4 4ereto attac4e as Anne6 A an9ae art 4ereof3

/A, a se!re!at#on s"rve) for t4e ort#on sol #n favor of t4e VE%-EE an t4e ort#onre9a#n#n! #n favor of t4e VE%-OR s4all

:::::::::::::::

E64#(#t B, co9#lat#on of e64#(#ts, . 5.&&8

&&8


%a("s vs. +acson

(e e6ec"te as soon as oss#(le, all at t4e e6ense of t4e VE%-EE 4ere#n3

/A, #t #s 9"t"all) "nerstoo t4at #n as 9"c4 as t4ere #s a cla#9 () ot4er ersons of t4e

ent#re roert) of 4#c4 t4e ort#on s"(?ect of t4#s nstr"9ent #s onl) a art, an t4at t4#scla#9 #s no t4e s"(?ect of a c#v#l case no en#n! (efore Branc4 of t4e o"rt of F#rstnstance of Ba!"#o an Ben!"et, s4o"l t4e VE%-OR 4ere#n (e efeate #n t4e sa# c#v#l act#onto t4e en t4at 4e #s #veste of t#tle over t4e area s"(?ect of t4#s nstr"9ent, t4en 4e 4ere()arrants t4at 4e s4all ret"rn an) an all 9on#es a# () t4e VE%-EE 4ere#n 4et4er a# tot4e +%B, La r#n#a, Ben!"et Branc4, or #rectl) rece#ve () 4ere#n VE%-OR, all s"c4 9on#esto (e ret"rne "on e9an () t4e VE%-EE3

/A, aG ort#on of t4e arcel of lan s"(?ect of t4#s #nstr"9ent #s resentl) #n t4e ossess#onof r. arcos aclo), an t4e VE%-OR a!rees to cooerate an ass#st #n an) 9anner oss#(le#n t4e o"ster of sa# r. arcos aclo) fro9 sa# ossess#on an occ"at#on to t4e en t4att4e VE%-EE 4ere#n s4all 9ae "se of sa# ort#on as soon as #s ract#ca(le3

/A, f#nall), t4e +ARES 4ere() a!ree t4at t4#s nstr"9ent s4all (e (#n#n! "on t4e#r

resect#ve 4e#rs, s"ccessors or ass#!ns.5

+"rs"ant to t4e -ee of on#t#onal Sale, resonents a# +%B t4e a9o"nt of +12,0&8.8;on Fe(r"ar) 22, 1'77; an +20,7.&0 on J"l) 17, 1'787 for t4e f"ll a)9ent of t4e loan.

At t4e t#9e of t4e transact#on, r. arcos aclo) 4a a (asetD9a#n! s4o on t4e roert),4#le t4e so"ses -elf#n an %el#ta Flores 4a a store. aclo) an t4e So"ses Flores vacatet4e roert) after resonents a# t4e9 +,000.00 eac4.

4ereafter, resonents too ossess#on of t4e s"(?ect roert). 4e) constr"cte an 80 ()&2Dfeet ("#l#n! an a steelD9att#n! fence aro"n t4e roert) to 4o"se t4e#r tr"c

8/14/2019 sales (1).rtf


:::::::::::::::

5 Rollo, . 57D58.

; E64#(#t -, co9#lat#on of e64#(#ts, . 1&.

7 E64#(#t E, .

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%a("s vs. +acson

(o)D("#l#n! s4o 4#c4 t4e) calle t4e E9#l#ano r"c#n! Bo) B"#ler an A"to Rea#r

S4o.

On -ece9(er 2, 1'77, (efore t4e a)9ent of t4e (alance of t4e 9ort!a!e a9o"nt #t4 +%B,Bate %a("s #e. On A"!"st 17, 1'78, 4#s s"rv#v#n! so"se, J"l#e %a("s, an t4e#r 9#nora"!4ter, #c4elle %a("s, e6ec"te a -ee of E6tra J"#c#al Settle9ent over t4e re!#sterelan covere () %o. ';'7. On t4e (as#s of t4e sa# oc"9ent, %o. D 177188 as#ss"e on Fe(r"ar) 17, 1'8 #n t4e na9es of J"l#e %a("s an #c4elle %a("s.

ean4#le, resonents cont#n"e a)#n! t4e#r (alance, not #n #nstall9ents of +2,000.00 asa!ree "on, ("t #n var#o"s, often s9all a9o"nts ran!#n! fro9 as lo as +10.00' to as 4#!4 as+15,5;;.00,10 sann#n! a er#o of al9ost seven )ears, fro9 arc4 ', 1'7711 to Jan"ar) 17,1'8.12

4ere as a total of &; rece#ts of a)9ent,1& 4#c4 rece#ts ere 9ostl) s#!ne () J"l#e%a("s, 4o also s#!ne as J"l#e N"an 4en s4e re9arr#e. 4e ot4ers 4o s#!ne ere Bate%a("s3 +%B, La r#n#a Branc43 a6#9a %a("s3 S)lv#a Re)es3 #c4elle %a("s an t4e secon4"s(an of J"l#e %a("s, $ereon N"an. a6#9a %a("s #s t4e 9ot4er of Bate %a("s, 4#le S)lv#aRe)es #s a n#ece.

4e rece#ts s4oe t4at t4e total s"9 a# () resonents to t4e So"ses %a("s as+112,55.1;,1 leav#n! a (alD

:::::::::::::::

8 E64#(#t R, ., at . ;0.

' E64#(#ts D1, D25, D2', an LD27, ., at . &&D&, &7.

10 E64#(#t JD1', ., at . &1.

11 E64#(#t /, ., at . 22.

12 E64#(#t %D1, ., at . 1.

1& E64#(#ts - to F3 FD1 to FD&3 $3 $D1 to $D883 /3 /D1 to /D23 3 D1to D573 J3 JD1 to JD;23 3 D1 to D523 L3 LD1 to LD283 3 D1 to D03 % an %D1, ., at . 1&D1.

8/14/2019 sales (1).rtf


1 E64#(#ts UU, UUD1 to UUD', ., at . 1&1.

&0

&0


%a("s vs. +acson

ance of +57,5.8. 4e s"9 of +&0,000.00 4#c4 as t4e val"e of t4e #cD" tr"c alle!el)sol an el#vere #n 1'78 to t4e So"ses %a("s, as not cons#ere as a)9ent (eca"se t4ere!#strat#on aers re9a#ne #n t4e na9e of #ts oner, -o9#n!a -. +acson, 4o #s t4e s#ster of Joa"#n +acson. 4e ve4#cle as also ret"rne to resonents.

-"r#n! t4e last ee of Jan"ar) 1'8, J"l#e %a("s, acco9an#e () 4er secon 4"s(an,aroac4e Joa"#n +acson to as for t4e f"ll a)9ent of t4e lot. Joa"#n +acson a!ree toa), ("t tol 4er to ret"rn after fo"r a)s as 4#s a"!4ter, atal#na +acson, o"l 4ave to !oover t4e n"9ero"s rece#ts to eter9#ne t4e (alance to (e a#. @4en J"l#e %a("s ret"rne

after fo"r a)s, Joa"#n sent 4er an 4#s a"!4ter, atal#na, to Att). El#Ha(et4 R#llera for t4ee6ec"t#on of t4e ee of a(sol"te sale. S#nce J"l#e as a #o #t4 a 9#nor a"!4ter, Att).R#llera re"#re J"l#e %a("s to ret"rn #n fo"r a)s #t4 t4e necessar) oc"9ents, s"c4 as t4eee of e6tra?"#c#al settle9ent, t4e transfer cert#f#cate of t#tle #n t4e na9es of J"l#e %a("san 9#nor #c4elle %a("s, an t4e !"ar#ans4# aers of #c4elle. /oever, J"l#e %a("s #not ret"rn.

$ett#n! s"s#c#o"s, atal#na +acson ent to t4e Re!#ster of -ees of t4e +rov#nce of Ben!"etan ase for a co) of t4e t#tle of t4e lan. S4e fo"n t4at #t as st#ll #n t4e na9e of J"l#e an#c4elle %a("s.

After a ee, atal#na +acson 4ear a r"9or t4at t4e lot as alrea) sol to et#t#oner Bett)olero. atal#na +acson an Att). R#llera ent to t4e Re!#ster of -ees of t4e +rov#nce ofBen!"et, an fo"n t4at J"l#e %a("s an 4er 9#nor a"!4ter, #c4elle %a("s, reresente ()t4e for9erCs 9ot4er as ao#nte !"ar#an () a co"rt orer ate Octo(er 2', 1'82, 4a

e6ec"te a -ee of A(sol"te Sale #n favor of Bett) olero on arc4 5, 1'8, cover#n! t4e 4olelot co9r#s#n! 1,;;5 s"are 9eters.15 4e roert) as escr#(e #n

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15 E64#(#t N, ., at . 55.

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VOL. ;05, %OVEBER 25, 200'

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%a("s vs. +acson

t4e ee of sale as co9r#s#n! fo"r lots> <1= Lot AD2DA, #t4 an area of 8&2 s"are 9eters3 <2=Lot AD2DB, 1;8 s"are 9eters3 <&= Lot AD2D, 200 s"are 9eters3 an <= Lot AD2D-, ;5 s"are9eters. Lots AD2DA an AD2DB, #t4 a co9(#ne area of 1,000 s"are 9eters, correson to t4elot rev#o"sl) sol to Joa"#n an J"l#a +acson #n t4e -ee of on#t#onal Sale.

8/14/2019 sales (1).rtf


atal#na +acson an Att). R#llera also fo"n t4at t4e ert#f#cate of #tle over t4e roert) #nt4e na9e of J"l#e an #c4elle %a("s as cancelle on arc4 1;, 1'8, an fo"r t#tles to t4efo"rs lots ere #ss"e #n t4e na9e of Bett) olero, na9el)> %o. D18;501; for Lot AD2DA3 %o. 18;5117 for Lot AD2DB3 %o. D18;5218 for Lot AD2D3 an D18;5&1' for Lot AD2D-.

On arc4 22, 1'8, t4e !ate to t4e rea#r s4o of t4e +acsons as aloce. A s#!n as#sla)e on t4e roert) stat#n! %o resass#n!.20

On arc4 2;, 1'8, atal#na +acson f#le an aff#av#tDco9la#nt re!ar#n! t4e aloc#n!#nc#ent of t4e#r rea#r s4o #t4 t4e ol#ce stat#on at La r#n#a, Ben!"et.

On arc4 28, 2008, resonents Joa"#n an J"l#a +acson f#le #t4 t4e Re!#onal r#al o"rt ofLa r#n#a, Ben!"et <tr#al co"rt= a o9la#nt21 for Ann"l9ent of -ees, #t4 a9a!es anra)er for t4e #ss"ance of a r#t of rel#9#nar) #n?"nct#on.22 4e) so"!4t t4e ann"l9ent of <1=t4e E6traD?"#c#al Settle9ent of Estate, #nsofar as t4e#r r#!4t to t4e 1,000Ds"areD9eter lots"(?ect of t4e -ee of on#t#onal Sale2& as affecte3 <2= %o. D17718 #ss"e #n t4ena9es

:::::::::::::::

1; E64#(#t S, ., at . ;1.

17 E64#(#t , ., at . ;2.

18 E64#(#t U, ., at . ;&.

1' E64#(#t V, ., at . ;.

20 E64#(#t @, ., at . ;5.

21 Anne6 , Rollo, . 8D5;.

22 -ocete as #v#l ase %o. 8DVD007'.

2& Rollo, . 57D;0.

&2

&2


%a("s vs. +acson

of J"l#e an #c4elle %a("s3 an <&= t4e -ee of A(sol"te Sale2 #n favor of Bett) olero ant4e transfer cert#f#cates of t#tle #ss"e "rs"ant t4ereto. 4e) also ra)e for t4e aar of

act"al, 9oral an e6e9lar) a9a!es, as ell as attorne)Cs fees.

n t4e#r Anser,25 J"l#e an #c4elle %a("s alle!e t4at resonent Joa"#n +acson # notrocee #t4 t4e con#t#onal sale of t4e s"(?ect roert) 4en 4e learne t4at t4ere as aen#n! case over t4e 4ole roert). Joa"#n roose t4at 4e o"l rat4er lease t4eroert) #t4 a 9ont4l) rental of +2,000.00 an al) t4e s"9 of +1&,000.00 as rentals, s#ncet4e a9o"nt as alrea) a# to t4e (an an co"l no lon!er (e #t4ran. /ence, 4e # notaff#6 4#s s#!nat"re to t4e secon a!e of a co) of t4e -ee of on#t#onal Sale.2; J"l#e %a("salle!e t4at #n arc4 1'', "e to 4er on econo9#c nees an t4ose of 4er 9#nor a"!4ter,s4e sol t4e roert) to Bett) olero, #t4 a"t4or#t) fro9 t4e co"rt.

8/14/2019 sales (1).rtf


-"r#n! t4e 4ear#n! on t4e 9er#ts, J"l#e %a("s test#f#e t4at s4e sol t4e roert) to Bett)olero (eca"se s4e as #n nee of 9one). S4e state t4at s4e as free to sell t4e roert)(eca"se t4e -ee of on#t#onal Sale e6ec"te #n favor of t4e So"ses +acson as converte#nto a contract of lease. S4e cla#9e t4at at t4e t#9e 4en t4e -ee of on#t#onal Sale as(e#n! e6la#ne to t4e9 () t4e notar) "(l#c, Joa"#n +acson alle!el) # not l#e t4e ort#onof t4e contract stat#n! t4at t4ere as a en#n! case #n co"rt #nvolv#n! t4e s"(?ect roert).onse"entl), Joa"#n +acson # not cont#n"e to s#!n t4e oc"9ent3 4ence, t4e secon a!e

of t4e oc"9ent as "ns#!ne.27 4ereafter, #t as alle!el) t4e#r "nerstan#n! t4at t4e+acsons o"l occ") t4e roert) as

:::::::::::::::

2 ., at . ;1D;5.

25 ., at . ;;D7&.

2; Anne6 A, Recors, vol. , . 11.

27 .

&&

VOL. ;05, %OVEBER 25, 200'

&&

%a("s vs. +acson

lessees an 4atever a9o"nt a# () t4e9 o"l (e cons#ere rentals.

Bett) olero "t " t4e efense t4at s4e as a "rc4aser #n !oo fa#t4 an for val"e. S4etest#f#e t4at #t as J"l#e %a("s 4o ent to 4er 4o"se an offere to sell t4e roert)cons#st#n! of to lots #t4 a co9(#ne area of 1,000 s"are 9eters. S4e cons"lte Att).A"rel#o e +eralta (efore s4e a!ree to (") t4e roert). S4e an J"l#e %a("s (ro"!4t to Att).-e +eralta t4e ert#nent aers s"c4 as %o. D17718 #n t4e na9es of J"l#e an #c4elle%a("s, t4e !"ar#ans4# aers of #c4elle %a("s an t4e (l"er#nt co) of t4e s"rve) lans4o#n! t4e to lots. After e6a9#n#n! t4e oc"9ents an f#n#n! t4at t4e t#tle as clean,Att). -e +eralta !ave 4er t4e !oDs#!nal to (") t4e roert).

olero test#f#e t4at "on a)9ent of t4e a!ree r#ce of +200,000.00, t4e -ee of A(sol"teSale as e6ec"te an re!#stere, res"lt#n! #n t4e cancellat#on of t4e t#tle of J"l#e an #c4elle%a("s an t4e #ss"ance #n 4er na9e of %os. D18;50 an D18;5128 correson#n! to t4eto lots. 4ereafter, s4e ase 4er co99onDla 4"s(an, Ben !nac#o, to aloc t4e !ate tot4e roert) an 4an! t4e %o resass#n! s#!n.

olero also test#f#e t4at as t4e ne oner, s4e as s"rr#se an s4oce to rece#ve t4e

o9la#nt f#le () t4e So"ses +acson. S4e a9#tte t4at s4e ne ver) ell t4e So"ses+acson, (eca"se t4e) "se to (") ve!eta(les re!"larl) fro9 4er. S4e 4a (een res##n! alon!t4e 4#!4a) at #lo9eter , La r#n#a, Ben!"et s#nce 1'71. S4e ne t4e lan #n "est#on,(eca"se #t as onl) 50 9eters aa) across t4e 4#!4a). S4e also ne t4at t4e So"ses+acson 4a a s4o on t4e roert) for t4e el#n! an (o)D("#l#n! of ve4#cles. S4e as notaare of t4e -ee of on#t#onal Sale e6ec"te #n favor of t4e +acsons, an s4e sa t4eoc"9ent for t4e f#rst t#9e 4en Joa"#n +acson s4oe #t to 4er after

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28 E64#(#ts ' an 10, Recors, vol. , . 1;'D170.

&

&


%a("s vs. +acson

s4e 4a alrea) (o"!4t t4e roert) an t4e t#tle 4a (een transferre #n 4er na9e. At t4et#9e s4e as (")#n! t4e roert), J"l#e %a("s #nfor9e 4er t4at t4e +acsons ere 9erel)rent#n! t4e roert). S4e # not (ot4er to ver#f) #f t4at as tr"e, (eca"se t4e +acsons ereno lon!er #n t4e roert) for to )ears (efore s4e (o"!4t #t.

n a -ec#s#on ate Sete9(er &0, 1''&, t4e tr#al co"rt r"le #n favor of resonents. 4e#sos#t#ve ort#on of t4e -ec#s#on reas>

@/EREFORE, re9#ses cons#ere, ?"!9ent #s 4ere() renere #n favor of t4e la#nt#ffs,orer#n! efenant Bett) olero to e6ec"te a ee of a(sol"te sale #n favor of t4e So"ses Joa"#n an J"l#a +acson over t4e lots covere () ransfer ert#f#cates of #tle %os. D18;50an D18;51 "on a)9ent to 4er () t4e la#nt#ffs of t4e s"9 of +57,5.8G reresent#n! t4e(alance "e for t4e f"ll a)9ent of t4e roert) s"(?ect of t4#s case. n a#t#on to t4ee6ec"t#on of a ee of a(sol"te sale, efenant Bett) olero s4all s"rrener to t4e la#nt#ffs4er onerCs "l#cate co) of ransfer ert#f#cates of #tle %os. D18;50 an D18;51.

-efenants J"l#e %a("s, #c4elle %a("s, an Bett) olero s4all also a) t4e la#nt#ffs a9a!esas follos> +50,000.00 for 9oral a9a!es3 +20,000.00 for e6e9lar) a9a!es3 an+10,000.00 for attorne)Cs fees an e6enses for l#t#!at#on.2'

o #ss"es eter9#ne () t4e tr#al co"rt ere> <1= @as t4e -ee of on#t#onal Sale (eteent4e So"ses +acson an t4e %a("ses converte #nto a contract of leaseT an <2= @as Bett)olero a (")er #n !oo fa#t4T

4e tr#al co"rt 4el t4at t4e -ee of on#t#onal Sale as not converte #nto a contract oflease (eca"se t4e or#!#nal co) of t4e contract&0 s4oe t4at all t4e a!es ere s#!ne () allt4e art#es to t4e contract. B) t4e res"9t#on of re!"lar#t), all ot4er car(on co#es 9"st4ave (een "l) s#!ne. 4e fa#l"re of Joa"#n +acson to s#!n t4e secon a!e of one of t4e

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2' A Rollo, . 2'D&0.

&0 E64#(#t A, co9#lat#on of e64#(#ts, . 1.

&5

VOL. ;05, %OVEBER 25, 200'

&5

%a("s vs. +acson

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car(on co#es of t4e contract as () s4eer #navertence. 4e o9#ss#on as of no conse"ences#nce t4e s#!nat"res of t4e art#es #n all t4e ot4er co#es of t4e contract ere co9lete.oreover, all t4e rece#ts of a)9ent e6ressl) state t4at t4e) ere 9ae #n a)9ent of t4elot. %ot a s#n!le rece#t s4oe a)9ent for rental.

F"rt4er, t4e tr#al co"rt 4el t4at Bett) olero as not a "rc4aser #n !oo fa#t4 as s4e 4aact"al nole!e of t4e on#t#onal Sale of t4e roert) to t4e +acsons.

4e tr#al co"rt state t4at t4e -ee of on#t#onal Sale conta#ne rec#rocal o(l#!at#ons(eteen t4e art#es, t4"s>

/A, as soon as t4e f"ll cons#erat#on of t4#s sale 4as (een a# () t4e VE%-EE, t4ecorreson#n! transfer oc"9ents s4all (e e6ec"te () t4e VE%-OR to t4e VE%-EE for t4eort#on sol3

6 6 6 6

/A, f#nall), t4e +ARES 4ere() a!ree t4at t4#s nstr"9ent s4all (e (#n#n! "on t4e#rresect#ve 4e#rs, s"ccessors or ass#!ns.&1

n ot4er ors, t4e tr#al co"rt state, 4en t4e venees <t4e So"ses +acson= ere alrea)rea) to a) t4e#r (alance, #t as t4e correson#n! o(l#!at#on of t4e venors <%a("ses= to

e6ec"te t4e transfer oc"9ents.

4e tr#al co"rt 4el t4at "Gner Art#cle 11'1 of t4e #v#l oe, an #n?"re art) #n a rec#rocalo(l#!at#on, s"c4 as t4e -ee of on#t#onal Sale #n t4e case at (ar, 9a) c4oose (eteen t4ef"lf#ll9ent orG t4e resc#ss#on of t4e o(l#!at#on, #t4 t4e a)9ent of a9a!es #n e#t4er case.t state t4at #n f#l#n! t4e case, t4e So"ses +acson ote for f"lf#ll9ent of t4e o(l#!at#on, t4at#s, t4e e6ec"t#on of t4e -ee of A(sol"te Sale #n t4e#r favor "on a)9ent of t4e "rc4aser#ce.

Resonents aeale t4e ec#s#on of t4e tr#al co"rt to t4e o"rt of Aeals.

:::::::::::::::

&1 Rollo, . 58.

&;

&;


%a("s vs. +acson

n t4e -ec#s#on ate %ove9(er 28, 200&, t4e o"rt of Aeals aff#r9e t4e tr#al co"rtCs

ec#s#on, ("t elete t4e aar of attorne)Cs fees. 4e #sos#t#ve ort#on of t4e -ec#s#onreas>

@/EREFORE, f#n#n! no revers#(le error #n t4e Sete9(er &0, 1''& -ec#s#on of t4e Re!#onalr#al o"rt of La r#n#a, Ben!"et, Branc4 10, #n #v#l ase %o. 8DVD007', t4e #nstant aeal#s 4ere() -SSSE- for lac of 9er#t, an t4e assa#le -ec#s#on #s 4ere() AFFRE- anU+/EL- #t4 t4e 9o#f#cat#on t4at t4e aar of attorne)Cs fees #s elete.&2

+et#t#oners f#le t4#s et#t#on ra#s#n! t4e follo#n! #ss"es>

8/14/2019 sales (1).rtf


/E OUR OF A++EALSG ERRE- % O%S-ER%$ /E O%RA E%ERE- %O BE@EE%/E S+OUSES BAE %ABUS A%- JULE %ABUS A%- S+OUSES JOANU% +ASO% A%- JULA+ASO% O BE A O%RA OF SALE.

/E OUR A NUO ERRE- % F%-%$ /A /ERE ARE O%LY @O SSUES % /E ASE O%

A++EAL A%- /EY ARE> @/E/ER /E -EE- OF O%-O%AL SALE @AS O%VERE- %O AO%RA OF LEASE3 A%- /A @/E/ERG +EO%ER BEY OLERO @AS A BUYER %$OO- FA/.

/A /E RAL OUR ERRE- % /OL-%$ /A RES+O%-E%SCG BALA%E O /E S+OUSES%ABUS U%-ER /E O%-O%AL SALE S O%LY +57,5.8G.

V

/A ASSU%$ @/OU A-%$ /A +EO%ER BEY OLERO @AS A@ARE OF /EESE%E OF /E -EE- OF O%-O%AL SALE, /E RAL OUR, AS @ELL AS /E OUROF A++EALSG, ERRE- % OR-ER%$

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&2 ., at . 2.

&7

VOL. ;05, %OVEBER 25, 200'

&7

%a("s vs. +acson

+EO%ER BEY OLERO O EEUE A -EE- OF ABSOLUE SALE % FAVOR OF /ERES+O%-E%SG A%- O SURRE%-ER /E O@%ERCS -U+LAE O+Y OF %OS. D18;50A%- D18;51, @// @AS %O +RAYE- FOR % /E +RAYER % /E O+LA%.

V

/A /E OUR OF A++EALSG ERRE- % F%-%$ BEY OLERO ASG A BUYER @/OG FALE-O AE SE+S % %NUR%$ FRO /E RES+O%-E%SG /E SAUS OF /E +RO+ERY %NUESO% BEFORE /ER +UR/ASE, O%RARY O FAS ESABLS/E- BY EV-E%E.

V

/E OUR OF A++EALSG ERRE- % O%S-ER%$ +EO%ER BEY OLERO A BUYER % BA-FA/, $%OR%$ /E A++LAO% OF /E -OR%E % /E RUL%$ OF /E SU+REE OUR% /E ASE OF RO-OLFO ALFO%SO, E AL. VS. OUR OF A++EALS, $.R. %O. ;&75.&&

4e 9a#n #ss"es to (e resolve are>

1=@4et4er or not t4e -ee of on#t#onal Sale as converte #nto a contract of lease3

2=@4et4er t4e -ee of on#t#onal Sale as a contract to sell or a contract of sale.

As re!ars t4e f#rst #ss"e, t4e -ee of on#t#onal Sale entere #nto () t4e So"ses +acson

8/14/2019 sales (1).rtf


an t4e So"ses %a("s as not converte #nto a contract of lease. 4e &; rece#ts #ss"e tot4e So"ses +acson conta#ne e#t4er t4e 4rase as art#al a)9ent of lot locate #n 9. orcas4 vale or cas4 vale <art#al a)9ent of lot locate #n 9. =, ev#enc#n! sale "ner t4econtract an not t4e lease of t4e roert). F"rt4er, as fo"n () t4e tr#al co"rt, Joa"#n+acsonCs nonDs#!n#n! of t4e secon a!e of a car(on co) of t4e -ee of on#t#onal Sale ast4ro"!4 s4eer #navertence, s#nce t4e or#!#nal conD

:::::::::::::::

&& ., at . 15D1;.

&8

&8


%a("s vs. +acson

tract& an t4e ot4er co#es of t4e contract ere all s#!ne () Joa"#n +acson an t4e ot4erart#es to t4e contract.

On t4e secon #ss"e, et#t#oners conten t4at t4e contract e6ec"te () t4e resonents ant4e So"ses %a("s as a contract to sell, not a contract of sale. 4e) alle!e t4at t4e contractas s"(?ect to t4e s"sens#ve con#t#on of f"ll a)9ent of t4e cons#erat#on a!ree "on(efore oners4# of t4e s"(?ect roert) co"l (e transferre to t4e venees. S#nceresonents fa#le to a) t4e f"ll a9o"nt of t4e cons#erat#on, 4av#n! an "na# (alance of+57,5.8, t4e o(l#!at#on of t4e venors to e6ec"te t4e -ee of A(sol"te Sale #n favor ofresonents # not ar#se. 4"s, t4e s"(se"ent -ee of A(sol"te Sale e6ec"te #n favor ofBett) olero, cover#n! t4e sa9e arcel of lan as val#, even #f olero as aare of t4erev#o"s ee of con#t#onal sale.

oreover, et#t#oners conten t4at resonents v#olate t4e st#"late con#t#on #n t4econtract t4at t4e 9ont4l) #nstall9ent to (e a# as +2,000.00, as resonents !ave 9ea!era9o"nts as lo as +10.00.

+et#t#oners also assert t4at resonentsC alle!at#on t4at J"l#e %a("sC fa#l"re to (r#n! t4eert#nent oc"9ents necessar) for t4e e6ec"t#on of t4e f#nal ee of a(sol"te sale, 4#c4 ast4e reason for t4e#r not 4av#n! a# t4e (alance of t4e "rc4ase r#ce, as "ntena(le, an ala9e an s4allo e6c"se for v#olat#on of t4e -ee of on#t#onal Sale. Resonents co"l 4ave9ae a val# tener of a)9ent of t4e#r re9a#n#n! (alance, as #t 4a (een "e for a lon! t#9e,an "on ref"sal to accet a)9ent, t4e) co"l 4ave cons#!ne t4e#r a)9ent to t4e co"rt asrov#e () la. 4#s, resonents fa#le to o.

4e o"rt 4ols t4at t4e contract entere #nto () t4e So"ses %a("s an resonents as acontract to sell, not a contract of sale.

:::::::::::::::

& E64#(#ts A an AD5, co9#lat#on of e64#(#ts, . 1D2.

&'

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VOL. ;05, %OVEBER 25, 200'

&'

%a("s vs. +acson

A contract of sale #s ef#ne #n Art#cle 158 of t4e #v#l oe, t4"s>

Art.158.B) t4e contract of sale, one of t4e contract#n! art#es o(l#!ates 4#9self to transfert4e oners4# of an to el#ver a eter9#nate t4#n!, an t4e ot4er to a) t4erefor a r#cecerta#n #n 9one) or #ts e"#valent.


Ra9os v. /er"ela&5 #fferent#ates a contract of a(sol"te sale an a contract of con#t#onalsale as follos>

Art#cle 158 of t4e #v#l oe rov#es t4at a contract of sale 9a) (e a(sol"te or con#t#onal.A contract of sale #s a(sol"te 4en t#tle to t4e roert) asses to t4e venee "on el#ver) oft4e t4#n! sol. A ee of sale #s a(sol"te 4en t4ere #s no st#"lat#on #n t4e contract t4at t#tleto t4e roert) re9a#ns #t4 t4e seller "nt#l f"ll a)9ent of t4e "rc4ase r#ce. 4e sale #salso a(sol"te #f t4ere #s no st#"lat#on !#v#n! t4e venor t4e r#!4t to cancel "n#laterall) t4e

contract t4e 9o9ent t4e venee fa#ls to a) #t4#n a f#6e er#o. n a con#t#onal sale, as #n acontract to sell, oners4# re9a#ns #t4 t4e venor an oes not ass to t4e venee "nt#l f"lla)9ent of t4e "rc4ase r#ce. 4e f"ll a)9ent of t4e "rc4ase r#ce artaes of as"sens#ve con#t#on, an nonDf"lf#ll9ent of t4e con#t#on revents t4e o(l#!at#on to sell fro9ar#s#n!.&;

oronel v. o"rt of Aeals&7 #st#n!"#s4e a contract to sell fro9 a contract of sale, t4"s>

Sale, () #ts ver) nat"re, #s a consens"al contract (eca"se #t #s erfecte () 9ere consent.4e essent#al ele9ents of a contract of sale are t4e follo#n!>

a=onsent or 9eet#n! of t4e 9#ns, t4at #s, consent to transfer oners4# #n e6c4an!e for t4er#ce3

(=-eter9#nate s"(?ect 9atter3 an

:::::::::::::::

&5 $.R. %o. 15&&0, Octo(er 1, 2005, 7& SRA 7'.

&; ., at . 8;. <E94as#s s"l#e.=

&7 &&1 +4#l. 2'3 2;& SRA 15 <1'';=.

&50

&50


%a("s vs. +acson

c=+r#ce certa#n #n 9one) or #ts e"#valent.

Uner t4#s ef#n#t#on, a ontract to Sell 9a) not (e cons#ere as a ontract of Sale (eca"se

8/14/2019 sales (1).rtf


t4e f#rst essent#al ele9ent #s lac#n!. n a contract to sell, t4e rosect#ve seller e6l#c#tl)reserves t4e transfer of t#tle to t4e rosect#ve (")er, 9ean#n!, t4e rosect#ve seller oesnot as )et a!ree or consent to transfer oners4# of t4e roert) s"(?ect of t4e contract tosell "nt#l t4e 4aen#n! of an event, 4#c4 for resent "roses e s4all tae as t4e f"lla)9ent of t4e "rc4ase r#ce. @4at t4e seller a!rees or o(l#!es 4#9self to o #s to f"lf#ll 4#sro9#se to sell t4e s"(?ect roert) 4en t4e ent#re a9o"nt of t4e "rc4ase r#ce #s el#vereto 4#9. n ot4er ors, t4e f"ll a)9ent of t4e "rc4ase r#ce artaes of a s"sens#ve

con#t#on, t4e nonDf"lf#l9ent of 4#c4 revents t4e o(l#!at#on to sell fro9 ar#s#n! an, t4"s,oners4# #s reta#ne () t4e rosect#ve seller #t4o"t f"rt4er re9e#es () t4e rosect#ve(")er.

6 6 6 6

State os#t#vel), "on t4e f"lf#ll9ent of t4e s"sens#ve con#t#on 4#c4 #s t4e f"ll a)9ent oft4e "rc4ase r#ce, t4e rosect#ve sellerCs o(l#!at#on to sell t4e s"(?ect roert) () enter#n!#nto a contract of sale #t4 t4e rosect#ve (")er (eco9es e9ana(le as rov#e #n Art#cle17' of t4e #v#l oe 4#c4 states>

Art. 17'. A ro9#se to (") an sell a eter9#nate t4#n! for a r#ce certa#n #s rec#rocall)e9ana(le.

An accete "n#lateral ro9#se to (") or to sell a eter9#nate t4#n! for a r#ce certa#n #s

(#n#n! "on t4e ro9#ssor #f t4e ro9#se #s s"orte () a cons#erat#on #st#nct fro9 t4er#ce.

A contract to sell 9a) t4"s (e ef#ne as a (#lateral contract 4ere() t4e rosect#ve seller,4#le e6ressl) reserv#n! t4e oners4# of t4e s"(?ect roert) es#te el#ver) t4ereof to t4erosect#ve (")er, (#ns 4#9self to sell t4e sa# roert) e6cl"s#vel) to t4e rosect#ve (")er"on f"lf#ll9ent of t4e con#t#on a!ree "on, t4at #s, f"ll a)9ent of t4e "rc4ase r#ce.

A contract to sell as ef#ne 4ere#na(ove, 9a) not even (e cons#ere as a con#t#onalcontract of sale 4ere t4e seller 9a) l#e#se reserve t#tle to t4e roert) s"(?ect of t4e sale"nt#l t4e f"lf#llD

&51

VOL. ;05, %OVEBER 25, 200'

&51

%a("s vs. +acson

9ent of a s"sens#ve con#t#on, (eca"se #n a con#t#onal contract of sale, t4e f#rst ele9ent ofconsent #s resent, alt4o"!4 #t #s con#t#one "on t4e 4aen#n! of a cont#n!ent event 4#c49a) or 9a) not occ"r. f t4e s"sens#ve con#t#on #s not f"lf#lle, t4e erfect#on of t4e contractof sale #s co9letel) a(ate. /oever, #f t4e s"sens#ve con#t#on #s f"lf#lle, t4e contract ofsale #s t4ere() erfecte, s"c4 t4at #f t4ere 4a alrea) (een rev#o"s el#ver) of t4e roert)s"(?ect of t4e sale to t4e (")er, oners4# t4ereto a"to9at#call) transfers to t4e (")er ()

oerat#on of la #t4o"t an) f"rt4er act 4av#n! to (e erfor9e () t4e seller.n a contract to sell, "on t4e f"lf#ll9ent of t4e s"sens#ve con#t#on 4#c4 #s t4e f"ll a)9entof t4e "rc4ase r#ce, oners4# #ll not a"to9at#call) transfer to t4e (")er alt4o"!4 t4eroert) 9a) 4ave (een rev#o"sl) el#vere to 4#9. 4e rosect#ve seller st#ll 4as to conve)t#tle to t4e rosect#ve (")er () enter#n! #nto a contract of a(sol"te sale.&8

F"rt4er, 4"a v. o"rt of Aeals&' c#te t4#s #st#nct#on (eteen a contract of sale an acontract to sell>

n a contract of sale, t4e t#tle to t4e roert) asses to t4e venee "on t4e el#ver) of t4e

8/14/2019 sales (1).rtf


t4#n! sol3 #n a contract to sell, oners4# #s, () a!ree9ent, reserve #n t4e venor an #s notto ass to t4e venee "nt#l f"ll a)9ent of t4e "rc4ase r#ce. Ot4er#se state, #n a contractof sale, t4e venor loses oners4# over t4e roert) an cannot recover #t "nt#l an "nlesst4e contract #s resolve or resc#ne3 4ereas, #n a contract to sell, t#tle #s reta#ne () t4evenor "nt#l f"ll a)9ent of t4e r#ce. n t4e latter contract, a)9ent of t4e r#ce #s a os#t#ves"sens#ve con#t#on, fa#l"re of 4#c4 #s not a (reac4 ("t an event t4at revents t4e o(l#!at#onof t4e venor to conve) t#tle fro9 (eco9#n! effect#ve.0

:::::::::::::::

&8 ., at . &08D&113 . 2;. <E94as#s s"l#e3 c#tat#ons o9#tte=.

&' ' +4#l. 253 01 SRA 5 <200&=.

0 ., at . 1D2, c#t#n! SalaHar v. o"rt of Aeals, 258 SRA &17 <1'';=.

&52

&52


%a("s vs. +acson

t #s not t4e t#tle of t4e contract, ("t #ts e6ress ter9s or st#"lat#ons t4at eter9#ne t4e#n of contract entere #nto () t4e art#es. n t4#s case, t4e contract ent#tle -ee ofon#t#onal Sale #s act"all) a contract to sell. 4e contract st#"late t4at as soon as t4e f"llcons#erat#on of t4e sale 4as (een a# () t4e venee, t4e correson#n! transfer oc"9entss4all (e e6ec"te () t4e venor to t4e venee for t4e ort#on sol.1 @4ere t4e venorro9#ses to e6ec"te a ee of a(sol"te sale "on t4e co9let#on () t4e venee of t4ea)9ent of t4e r#ce, t4e contract #s onl) a contract to sell.2 4e aforec#te st#"lat#ons4os t4at t4e venors reserve t#tle to t4e s"(?ect roert) "nt#l f"ll a)9ent of t4e"rc4ase r#ce.

f resonents a# t4e So"ses %a("s #n accorance #t4 t4e st#"lat#ons #n t4e -ee ofon#t#onal Sale, t4e cons#erat#on o"l 4ave (een f"ll) a# #n J"ne 1'8&. 4"s, "r#n! t4elast ee of Jan"ar) 1'8, J"l#e %a("s aroac4e Joa"#n +acson to as for t4e f"ll a)9entof t4e lot. Joa"#n +acson a!ree to a), ("t tol 4er to ret"rn after fo"r a)s as 4#s a"!4ter,atal#na +acson, o"l 4ave to !o over t4e n"9ero"s rece#ts to eter9#ne t4e (alance to (ea#.

@4en J"l#e %a("s ret"rne after fo"r a)s, Joa"#n +acson sent J"l#e %a("s an 4#s a"!4ter,atal#na, to Att). El#Ha(et4 R#llera for t4e e6ec"t#on of t4e ee of sale. S#nce Bate %a("s 4aalrea) #e, an as s"rv#ve () J"l#e an t4e#r 9#nor a"!4ter, Att). R#llera re"#re J"l#e%a("s to ret"rn #n fo"r a)s #t4 t4e necessar) oc"9ents s"c4 as t4e ee of e6tra?"#c#alsettle9ent, t4e transfer cert#f#cate of t#tle #n t4e na9es of J"l#e %a("s an 9#nor #c4elle

%a("s, an t4e !"ar#ans4# aers of #c4elle. /oever, J"l#e %a("s # not ret"rn.

:::::::::::::::

1 E94as#s s"l#e.

2 Ver Re)es v. Salvaor, Sr., $.R. %os. 1&'07 1&'&;5, Sete9(er 11, 2008, 5; SRA 5;,7'D80.

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&5&

VOL. ;05, %OVEBER 25, 200'

&5&

%a("s vs. +acson

As venees !#ven ossess#on of t4e s"(?ect roert), t4e oners4# of 4#c4 as st#ll #t4 t4evenors, t4e +acsons s4o"l 4ave rotecte t4e#r #nterest an #n"#re fro9 J"l#e %a("s 4)s4e # not ret"rn an t4en folloe t4ro"!4 #t4 f"ll a)9ent of t4e "rc4ase r#ce an t4ee6ec"t#on of t4e ee of a(sol"te sale. 4e So"ses +acson 4a t4e le!al re9e) ofcons#!n#n! t4e#r a)9ent to t4e co"rt3 4oever, t4e) # not o so. A r"9or t4at t4e roert)4a (een sol to Bett) olero ro9te t4e9 to c4ec t4e verac#t) of t4e sale #t4 t4eRe!#ster of -ees of t4e +rov#nce of Ben!"et. 4e) fo"n o"t t4at on arc4 5, 1'8, J"l#e%a("s sol t4e sa9e roert) to Bett) olero t4ro"!4 a -ee of A(sol"te Sale, an netransfer cert#f#cates of t#tle to t4e roert) ere #ss"e to olero.

4"s, t4e So"ses +acson f#le t4#s case for t4e ann"l9ent of t4e contract of a(sol"te sale

e6ec"te #n favor of Bett) olero an t4e transfer cert#f#cates of t#tle #ss"e #n 4er na9e.

Unfort"natel) for t4e So"ses +acson, s#nce t4e -ee of on#t#onal Sale e6ec"te #n t4e#rfavor as 9erel) a contract to sell, t4e o(l#!at#on of t4e seller to sell (eco9es e9ana(leonl) "on t4e 4aen#n! of t4e s"sens#ve con#t#on.& 4e f"ll a)9ent of t4e "rc4aser#ce #s t4e os#t#ve s"sens#ve con#t#on, t4e fa#l"re of 4#c4 #s not a (reac4 of contract, ("ts#9l) an event t4at revente t4e o(l#!at#on of t4e venor to conve) t#tle fro9 ac"#r#n!(#n#n! force. 4"s, for #ts nonDf"lf#l9ent, t4ere #s no contract to sea of, t4e o(l#!or4av#n! fa#le to erfor9 t4e s"sens#ve con#t#on 4#c4 enforces a ?"r##cal relat#on.5 @#t4t4#s c#rc"9stance, t4ere can (e no resc#ss#on or f"lf#l9ent of an o(l#!at#on t4at #s st#ll nonDe6#stent, t4e s"sens#ve

:::::::::::::::

& 4"a v. o"rt of Aeals, s"ra note &'.

/e#rs of +ero Escanlar v. o"rt of Aeals, $.R. %o. 11'777, Octo(er 2&, 1''7, 281 SRA17;, 188. <E94as#s s"l#e.=

5 4en! v. $enato, &;0 +4#l. 8'1, '0D'053 &00 SRA 722, 7& <1''8=.

&5

&5


%a("s vs. +acson

con#t#on not 4av#n! occ"rre as )et.; E94as#s s4o"l (e 9ae t4at t4e (reac4conte9late #n Art#cle 11'1 of t4e %e #v#l oe #s t4e o(l#!orCs fa#l"re to co9l) #t4 ano(l#!at#on alrea) e6tant, not a fa#l"re of a con#t#on to rener (#n#n! t4at o(l#!at#on.7

4e tr#al co"rt, t4erefore, erre #n al)#n! Art#cle 11'1 of t4e #v#l oe8 #n t4#s case ()orer#n! f"lf#ll9ent of t4e o(l#!at#on, t4at #s, t4e e6ec"t#on of t4e ee of a(sol"te sale #n

8/14/2019 sales (1).rtf


favor of t4e So"ses +acson "on f"ll a)9ent of t4e "rc4ase r#ce, 4#c4 ec#s#on asaff#r9e () t4e o"rt of Aeals. A)ala L#fe ns"rance, nc. v. Ra) B"rton -evelo9entororat#on' 4el>

Ev#entl), (efore t4e re9e) of sec#f#c erfor9ance 9a) (e ava#le of, t4ere 9"st (e a(reac4 of t4e contract.

Uner a contract to sell, t4e t#tle of t4e t4#n! to (e sol #s reta#ne () t4e seller "nt#l t4e"rc4aser 9aes f"ll a)9ent of t4e a!ree "rc4ase r#ce. S"c4 a)9ent #s a os#t#ves"sens#ve con#t#on, t4e nonDf"lf#ll9ent of 4#c4 #s not a (reac4 of contract ("t 9erel) anevent t4at revents t4e seller fro9 conve)#n! t#tle to t4e "rc4aser. 4e nonDa)9ent of t4e"rc4ase r#ce reners t4e conD

:::::::::::::::

; ., at . '05.

7 .

8 Art. 11'1.4e oer to resc#n o(l#!at#ons #s #9l#e #n rec#rocal ones, #n case one of t4eo(l#!ors s4o"l not co9l) #t4 4at #s #nc"9(ent "on 4#9.

4e #n?"re art) 9a) c4oose (eteen t4e f"lf#ll9ent an t4e resc#ss#on of t4e o(l#!at#on,#t4 t4e a)9ent of a9a!es #n e#t4er case. /e 9a) also see resc#ss#on, even after 4e 4asc4osen f"lf#ll9ent, #f t4e latter s4o"l (eco9e #9oss#(le.

4e co"rt s4all ecree t4e resc#ss#on cla#9e, "nless t4ere (e ?"st ca"se a"t4or#H#n! t4e f#6#n!of a er#o.

4#s #s "nerstoo to (e #t4o"t re?"#ce to t4e r#!4ts of t4#r ersons 4o 4ave ac"#ret4e t4#n!, #n accorance #t4 art#cles 1&85 an 1&88 an t4e ort!a!e La.

' $.R. %o. 1;&075, Jan"ar) 2&, 200;, 7' SRA ;2.

&55

VOL. ;05, %OVEBER 25, 200'

&55

%a("s vs. +acson

tract to sell #neffect#ve an #t4o"t force an effect. 4"s, a ca"se of act#on for sec#f#cerfor9ance oes not ar#se.50

S#nce t4e contract to sell as #t4o"t force an effect, J"l#e %a("s val#l) conve)e t4e

s"(?ect roert) to anot4er (")er, et#t#oner Bett) olero, t4ro"!4 a contract of a(sol"te sale,an on t4e stren!t4 t4ereof, ne transfer cert#f#cates of t#tle over t4e s"(?ect roert) ere"l) #ss"e to olero.51

4e So"ses +acson, 4oever, 4ave t4e r#!4t to t4e re#9("rse9ent of t4e#r a)9ents to t4e%a("ses, an are ent#tle to t4e aar of no9#nal a9a!es. 4e #v#l oe rov#es>

Art.2221.%o9#nal a9a!es are a?"#cate #n orer t4at a r#!4t of t4e la#nt#ff, 4#c4 4as(een v#olate or #nvae () t4e efenant, 9a) (e v#n#cate or reco!n#He, an not for t4e"rose of #ne9n#f)#n! t4e la#nt#ff for an) loss s"ffere () 4#9.

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Art.2222.4e co"rt 9a) aar no9#nal a9a!es #n ever) o(l#!at#on ar#s#n! fro9 an) so"rceen"9erate #n art#cle 1157, or #n ever) case 4ere an) roert) r#!4t 4as (een #nvae.

As state () t4e tr#al co"rt, "ner t4e -ee of on#t#onal Sale, resonents 4a t4e r#!4t toe9an fro9 et#t#oners J"l#e an #c4elle %a("s t4at t4e latter e6ec"te #n t4e#r favor a eeof a(sol"te sale 4en t4e) ere rea) to a) t4e re9a#n#n! (alance of t4e "rc4ase r#ce. 4e%a("ses 4a t4e correson#n! "t) to resect t4e resonentsC r#!4t, ("t t4e) v#olate s"c4

r#!4t, for t4e) co"l no lon!er e6ec"te t4e oc"9ent s#nce t4e) 4a sol t4e roert) to Bett)olero.52 /ence, no9#nal a9a!es #n t4e a9o"nt of +10,000.00 are aare to resonents.

Resonents are not ent#tle to 9oral a9a!es (eca"se contracts are not referre to #nArt#cle 221'5& of t4e #v#l

:::::::::::::::

50 ., at . ;'. <E94as#s s"l#e.=

51 See Ver Re)es v. Salvaor, Sr., s"ra note 2.

52 R -ec#s#on, Recors, . 20.5& Art.221'.oral a9a!es 9a) (e recovere #n t4e follo#n! analo!o"s cases>

&5;

&5;


%a("s vs. +acson

oe, 4#c4 en"9erates t4e cases 4en 9oral a9a!es 9a) (e recovere. Art#cle 22205 of

t4e #v#l oe allos t4e recover) of 9oral a9a!es #n (reac4es of contract 4ere t4eefenant acte fra""lentl) or #n (a fa#t4. /oever, t4#s case #nvolves a contract to sell,4ere#n f"ll a)9ent of t4e "rc4ase r#ce #s a os#t#ve s"sens#ve con#t#on, t4e nonDf"lf#ll9ent of 4#c4 #s not a (reac4 of contract, ("t 9erel) an event t4at revents t4e sellerfro9 conve)#n! t#tle to t4e "rc4aser. S#nce t4ere #s no (reac4 of contract #n t4#s case,resonents are not ent#tle to 9oral a9a!es.

n t4e a(sence of 9oral, te9erate, l#"#ate or co9ensator) a9a!es, e6e9lar) a9a!escannot (e !rante for t4e) are alloe onl) #n a#t#on to an) of t4e fo"r #ns of a9a!es9ent#one.55

@/EREFORE, t4e et#t#on #s $RA%E-. 4e -ec#s#on of t4e o"rt of Aeals #n AD$.R. V %o.'1, ate %ove9(er 28, 200&, #s REVERSE- an SE AS-E. J"!9ent #s

:::::::::::::::

<1=A cr#9#nal case res"lt#n! #n 4)s#cal #n?"r#es3

<2=N"as#Del#cts ca"s#n! 4)s#cal #n?"r#es3

<&=Se"ct#on, a("ct#on, rae, or ot4er lasc#v#o"s acts3

8/14/2019 sales (1).rtf


<=A"lter) or conc"(#na!e

<5=lle!al or ar(#trar) etent#on or arrest3

<;=lle!al searc43

<7=L#(el, slaner or an) ot4er for9 of efa9at#on3

<8=al#c#o"s rosec"t#on3

<'=Acts 9ent#one #n Art#cle &0'3

<10=Acts an act#ons referre to #n Art#cles 21, 2;, 27, 28, 2', &0, &2, &, an &5.

5 Art. 2220.@#llf"l #n?"r) to roert) 9a) (e a le!al !ro"n for aar#n! 9oral a9a!es #ft4e co"rt s4o"l f#n t4at, "ner t4e c#rc"9stances, s"c4 a9a!es are ?"stl) "e. 4e sa9er"le al#es to (reac4es of contract 4ere t4e efenant acte fra""lentl) or #n (a fa#t4.

55 #v#l oe, Art.222'.E6e9lar) or correct#ve a9a!es are #9ose, () a) of e6a9le orcorrect#on for t4e "(l#c !oo3 #n a#t#on to t4e 9oral, te9erate, l#"#ate or co9ensator)a9a!es.

&57

VOL. ;05, %OVEBER 25, 200'

&57

%a("s vs. +acson

4ere() renere "4ol#n! t4e val##t) of t4e sale of t4e s"(?ect roert) 9ae () et#t#oners J"l#e %a("s an #c4elle %a("s #n favor of et#t#oner Bett) olero, as ell as t4e val##t) ofransfer ert#f#cates of #tle %os. D18;50 an D18;51 #ss"e #n t4e na9e of Bett) olero.+et#t#oners J"l#e %a("s an #c4elle %a("s are orere to re#9("rse resonents so"ses

Joa"#n an J"l#a +acson t4e s"9 of One /"nre elve 4o"san Fo"r /"nre F#ft)DF#ve+esos an S#6teen entavos <+112,55.1;=, an to a) Joa"#n an J"l#a +acson no9#nala9a!es #n t4e a9o"nt of en 4o"san +esos <+10,000.00=, #t4 ann"al #nterest of telveercent <12= "nt#l f"ll a)9ent of t4e a9o"nts "e to Joa"#n an J"l#a +acson.

%o costs.

SO OR-ERE-.

orona <4a#rerson=, 4#coD%aHar#o, Velasco, Jr. an %ac4"ra, an JJ., conc"r.

+et#t#on !rante, ?"!9ent reverse an set as#e.

%ote.Lo!#call), t4e -ee of on#t#onal Sale an t4e -ee of A(sol"te Sale cannot coDe6#st ast4ese are of #fferent nat"re an rov#e for searate an #st#nct o(l#!at#ons. <on! vs.

$ar!antos, 507 SRA 50 200;G= %a("s vs. +acson, ;05 SRA &&<200'=G

$.R. %o. 1880;.J"ne 1, 2011.*

LA A. REYES, et#t#oner, vs. VORA . U+ARA%, resonent.

#v#l La3 Sales3 ontract to Sell3 ResonentCs fa#l"re to a) #n f"ll t4e "rc4ase r#ce #s nott4e (reac4 of contract conte9late "ner Art#cle 11'1 of t4e %e #v#l oe ("t rat4er ?"st

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an event t4at revents t4e et#t#oner fro9 (e#n! (o"n to conve) t#tle to t4e resonent.4e et#t#onerCs o(l#!at#on to sell t4e s"(?ect roert#es (eco9es e9ana(le onl) "on t4e4aen#n! of t4e os#t#ve s"sens#ve con#t#on, 4#c4 #s t4e resonentCs f"ll a)9ent of t4e"rc4ase r#ce. @#t4o"t resonentCs f"ll a)9ent, t4ere can (e no (reac4 of contract tosea of (eca"se et#t#oner 4as no o(l#!at#on )et to t"rn over t4e t#tle. ResonentCs fa#l"reto a) #n f"ll t4e "rc4ase r#ce #s not t4e (reac4 of contract conte9late "ner Art#cle 11'1of t4e %e #v#l oe ("t rat4er ?"st an event t4at revents t4e et#t#oner fro9 (e#n! (o"n

to conve) t#tle to t4e resonent.

Sa9e3 ontracts3 Resc#ss#on3 Resc#ss#on #s alloe onl) 4en t4e (reac4 of t4e contract #ss"(stant#al an f"na9ental to t4e f"lf#ll9ent of t4e o(l#!at#on.Unless t4e art#es st#"late#t, resc#ss#on #s alloe onl) 4en t4e (reac4 of t4e contract #s s"(stant#al an f"na9ental tot4e f"lf#ll9ent of t4e o(l#!at#on. @4et4er t4e (reac4 #s sl#!4t or s"(stant#al #s lar!el)eter9#ne () t4e attenant c#rc"9stances.



Ven"st#ano S. Ro6as Assoc#ates La Off#ce for et#t#oner.

Alenta?an La Off#ce for resonent.

A#reen -. S#son coDco"nsel for resonent.

:::::::::::::::

* SEO%- -VSO%.

28

28


Re)es vs. "aran

E%-OIA,J.>

S"(?ect of t4#s et#t#on for rev#e #s t4e Fe(r"ar) 1&, 200' -ec#s#on1 of t4e o"rt of Aeals<A= 4#c4 aff#r9e #t4 9o#f#cat#on t4e Fe(r"ar) 22, 200; -ec#s#on2 of t4e Re!#onal r#alo"rt, Branc4 172, ValenH"ela #t) <R=, #n #v#l ase %o. &'5DVD'2, an act#on for Resc#ss#onof ontract #t4 -a9a!es.

On Sete9(er 10, 1''2, #la A. Re)es <et#t#oner= f#le a co9la#nt for Resc#ss#on of ontract#t4 -a9a!es a!a#nst V#ctor#a . "aran <resonent= (efore t4e R. n 4er o9la#nt,

et#t#oner alle!e, a9on! ot4ers, t4at s4e as t4e re!#stere oner of a 1,27 s"are 9eterres#ent#al an co99erc#al lot locate #n ar"4atan, ValenH"ela #t), an covere () %o.VD1&03 t4at on t4at roert), s4e "t " a t4reeDstore) co99erc#al ("#l#n! non as RBJB"#l#n! an a res#ent#al aart9ent ("#l#n!3 t4at s#nce 1''0, s4e 4a (een oerat#n! ar"!store an cos9et#cs store on t4e !ro"n floor of RBJ B"#l#n! 4ere s4e also 4a (eenres##n! 4#le t4e ot4er areas of t4e ("#l#n!s #ncl"#n! t4e s#eals ere (e#n! lease anocc"#e () tenants an street venors.

n -ece9(er 1'8', resonent lease fro9 et#t#oner a sace on t4e !ro"n floor of t4e RBJB"#l#n! for 4er ans4o ("s#ness for a 9ont4l) rental of +,000.00. A close fr#ens4#eveloe (eteen t4e to 4#c4 le to t4e resonent #nvest#n! t4o"sans of esos #n

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et#t#onerCs f#nanc#n!Wlen#n! ("s#ness fro9 Fe(r"ar) 7, 1''0 to a) 27, 1''0, #t4 #nterest att4e rate of ; a 9ont4.

On J"ne 20, 1'88, et#t#oner 9ort!a!e t4e s"(?ect real roert#es to t4e Far9ers Sav#n!sBan an Loan Ban, nc.

:::::::::::::::

1 Rollo, . 72D1023 enne () Assoc#ate J"st#ce el#a . L#(reaDLea!o!o an conc"rre #n ()Assoc#ate J"st#ce J"an N. Enr#"eH, Jr. an Assoc#ate J"st#ce %or9an#e B. +#Harro.

2 ., at . 17D1;2.

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Re)es vs. "aran

<FSL Ban= to sec"re a loan of +2,000,000.00 a)a(le #n #nstall9ents. On %ove9(er 15, 1''0,et#t#onerCs o"tstan#n! acco"nt on t4e 9ort!a!e reac4e +2,278,078.1&. +et#t#oner t4enec#e to sell 4er real roert#es for at least +;,500,000.00 so s4e co"l l#"#ate 4er (anloan an f#nance 4er ("s#nesses. As a !est"re of fr#ens4#, resonent ver(all) offere tocon#t#onall) (") et#t#onerCs real roert#es for +,200,000.00 a)a(le on #nstall9ent (as#s#t4o"t #nterest an to ass"9e t4e (an loan. o #n"ce t4e et#t#oner to accet 4er offer,resonent offere t4e follo#n! con#t#onsWconcess#ons>

1.4at t4e con#t#onal sale #ll (e cancelle #f t4e la#nt#ff <et#t#oner= can f#n a (")er ofsa# roert#es for t4e a9o"nt of +;,500,000.00 #t4#n t4e ne6t t4ree <&= 9ont4s rov#e alla9o"nts rece#ve () t4e la#nt#ff fro9 t4e efenant <resonent= #ncl"#n! a)9entsact"all) 9ae () efenant to Far9ers Sav#n!s an Loan Ban o"l (e ref"ne to t4eefenant #t4 a#t#onal #nterest of s#6 <;= 9ont4l)3

2.4at t4e la#nt#ff o"l cont#n"e "s#n! t4e sace occ"#e () 4er an r"!store ancos9et#cs store #t4o"t an) rentals for t4e "rat#on of t4e #nstall9ent a)9ents3

&. 4at t4ere #ll (e a lease for f#fteen <15= )ears #n favor of t4e la#nt#ff over t4e sace forr"!store an cos9et#cs store at a 9ont4l) rental of onl) +8,000.00 after f"ll a)9ent of t4est#"late #nstall9ent a)9ents are 9ae () t4e efenant3

. 4at t4e efenant #ll "nertae t4e reneal an a)9ent of t4e f#re #ns"rance ol#c#es ont4e to <2= s"(?ect ("#l#n!s follo#n! t4e e6#rat#on of t4e t4en e6#st#n! f#re #ns"rance ol#c)of t4e la#nt#ff " to t4e t#9e t4at la#nt#ff #s f"ll) a# of t4e total "rc4ase r#ce of+,200,000.00.&

After et#t#onerCs ver(al accetance of all t4e con#t#onsWconcess#ons, (ot4 art#es oreto!et4er to o(ta#n FSL BanCs aroval for resonent to ass"9e 4er <et#t#onerCs=o"tstan#n! (an acco"nt. 4e ass"9t#on o"l (e art of

:::::::::::::::

& +ara!ra4 11 of t4e o9la#nt, #., at . 17;.

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28;

28;


Re)es vs. "aran

resonentCs "rc4ase r#ce for et#t#onerCs 9ort!a!e real roert#es. FSL Ban arovet4e#r roosal on t4e con#t#on t4at et#t#oner o"l s#!n or re9a#n as coD9aer for t4e9ort!a!e o(l#!at#on ass"9e () resonent.

On %ove9(er 2;, 1''0, t4e art#es an FSL Ban e6ec"te t4e correson#n! -ee ofon#t#onal Sale of Real +roert#es #t4 Ass"9t#on of ort!a!e. -"e to t4e#r close ersonalfr#ens4# an ("s#ness relat#ons4#, (ot4 art#es c4ose not to re"ce #nto r#t#n! t4e ot4erter9s of t4e#r a!ree9ent 9ent#one #n ara!ra4 11 of t4e co9la#nt. Bes#es, FSL Ban #not ant to #ncororate #n t4e -ee of on#t#onal Sale of Real +roert#es #t4 Ass"9t#on ofort!a!e an) ot4er s#e a!ree9ent (eteen et#t#oner an resonent.

Uner t4e -ee of on#t#onal Sale of Real +roert#es #t4 Ass"9t#on of ort!a!e,resonent as (o"n to a) t4e et#t#oner a l"9 s"9 of +1.2 9#ll#on esos #t4o"t #nterestas art of t4e "rc4ase r#ce #n t4ree <&= f#6e #nstall9ents as follos>

a=+200,000.00 P "e Jan"ar) &1, 1''1

(=+200,000.00 P "e J"ne &0, 1''1

c=+800,000.00 P "e -ece9(er &1, 1''1

Resonent, 4oever, efa"lte #n t4e a)9ent of 4er o(l#!at#ons on t4e#r "e ates. nsteaof a)#n! t4e a9o"nts "e #n l"9 s"9 on t4e#r resect#ve 9at"r#t) ates, resonent a#et#t#oner #n s9all a9o"nts fro9 t#9e to t#9e. o co9ensate for 4er ela)e a)9ents,resonent a!ree to a) et#t#oner an #nterest of ; a 9ont4. As of A"!"st &1, 1''2,resonent 4a onl) a# +&'5,000.00, leav#n! a (alance of +805,000.00 as r#nc#al on t4e

"na# #nstall9ents an +;;,8'&.25 as "na# acc"9"late #nterest.

+et#t#oner f"rt4er averre t4at es#te 4er s"ccess #n f#n#n! a rosect#ve (")er for t4es"(?ect real roert#es #t4#n t4e &D9ont4 er#o a!ree "on, resonent rene!e on 4erro9#se to allo t4e cancellat#on of t4e#r ee of con#t#onal sale. nstea, resonent(eca9e #ntereste #n on#n! t4e

287

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Re)es vs. "aran

s"(?ect real roert#es an even ante to convert t4e ent#re roert) #nto a 9oernco99erc#al co9le6. %onet4eless, s4e consente (eca"se resonent reeatel) rofessefr#ens4# an ass"re 4er t4at all t4e#r ver(al s#e a!ree9ent o"l (e 4onore as s4on ()t4e fact t4at s#nce -ece9(er 1''0, s4e <resonent= 4a not collecte an) rentals fro9 t4eet#t#oner for t4e sace occ"#e () 4er r"!store an cos9et#cs store.

On arc4 1', 1''2, t4e res#ent#al ("#l#n! as !"tte () f#re 4#c4 ca"se t4e et#t#oner tolose rental #nco9e #n t4e a9o"nt of +8,000.00 a 9ont4 s#nce Ar#l 1''2. Resonent

8/14/2019 sales (1).rtf


ne!lecte to rene t4e f#re #ns"rance ol#c) on t4e s"(?ect ("#l#n!s.

S#nce -ece9(er 1''0, resonent 4a taen ossess#on of t4e s"(?ect real roert#es an 4a(een cont#n"o"sl) collect#n! an rece#v#n! 9ont4l) rental #nco9e fro9 t4e tenants of t4e("#l#n!s an venors of t4e s#eal front#n! t4e RBJ ("#l#n! #t4o"t s4ar#n! #t #t4et#t#oner.

On Sete9(er 2, 1''2, resonent offere t4e a9o"nt of +751,000.00 onl) a)a(le onSete9(er 7, 1''2, as f"ll a)9ent of t4e "rc4ase r#ce of t4e s"(?ect real roert#es ane9ane t4e s#9"ltaneo"s e6ec"t#on of t4e correson#n! ee of a(sol"te sale.

ResonentCs Anser

Resonent co"ntere, a9on! ot4ers, t4at t4e tr#art#te a!ree9ent erroneo"sl) es#!nate() t4e et#t#oner as a -ee of on#t#onal Sale of Real +roert) #t4 Ass"9t#on of ort!a!eas act"all) a "re an a(sol"te contract of sale #t4 a ter9 er#o. t co"l not (econs#ere a con#t#onal sale (eca"se t4e ac"#s#t#on of contract"al r#!4ts an t4eerfor9ance of t4e o(l#!at#on t4ere#n # not een "on a f"t"re an "ncerta#n event.oreover, t4e ca#tal !a#ns an oc"9entar) sta9s an ot4er 9#scellaneo"s e6enses anreal estate ta6es " to 1''0 ere s"ose to (e a# () et#t#oner ("t s4e fa#le to o so.

288

288


Re)es vs. "aran

Resonent f"rt4er averre t4at s4e s"ccessf"ll) resc"e t4e roert#es fro9 a ef#n#teforeclos"re () a)#n! t4e ass"9e 9ort!a!e #n t4e a9o"nt of +2,278,078.1& l"s #nterest anot4er f#nance c4ar!es. Beca"se of 4er a)9ent, s4e as a(le to o(ta#n a ee of cancellat#onof 9ort!a!e an sec"re a release of 9ort!a!e on t4e s"(?ect real roert#es #ncl"#n!et#t#onerCs ancestral res#ent#al roert) #n Sta. ar#a, B"lacan.

+et#t#onerCs cla#9 for t4e (alance of t4e "rc4ase r#ce of t4e s"(?ect real roert#es as(aseless an "narrante (eca"se t4e f"ll a9o"nt of t4e "rc4ase r#ce 4a alrea) (eena#, as s4e # a) 9ore t4an +,200,000.00, t4e a!ree "rc4ase r#ce of t4e s"(?ect realroert#es, an s4e 4a even #ntro"ce #9rove9ents t4ereon ort4 9ore t4an+,800,000.00. As t4e art#es co"l no lon!er (e restore to t4e#r or#!#nal os#t#ons, resc#ss#onco"l not (e resorte to.

Resonent ae t4at as a res"lt of t4e#r ("s#ness relat#ons4#, et#t#oner as a(le to o(ta#nfro9 4er a loan #n t4e a9o"nt of +00,000.00 #t4 #nterest an too several #eces of ?eelr)ort4 +120,000.00. +et#t#oner also fa#le an ref"se to a) t4e 9ont4l) rental of +20,000.00s#nce %ove9(er 1;, 1''0 " to t4e resent for t4e "se an occ"anc) of t4e !ro"n floor oft4e ("#l#n! on t4e s"(?ect real roert), t4"s, acc"9"lat#n! arreara!es #n t4e a9o"nt of+70,000.00 as of Octo(er 1''2.

R"l#n! of t4e R

On Fe(r"ar) 22, 200;, t4e R 4ane on #ts ec#s#on f#n#n! t4at resonent fa#le to a)#n f"ll t4e +.2 9#ll#on total "rc4ase r#ce of t4e s"(?ect real roert#es leav#n! a (alance of+805,000.00. t state t4at t4e c4ecs an rece#ts resente () resonent refer to 4era)9ents of t4e 9ort!a!e o(l#!at#on #t4 FSL Ban an not t4e a)9ent of t4e (alance of+1,200,000.00. 4e R also cons#ere t4e -ee of on#t#onal Sale of Real +roert) #t4Ass"9t#on of ort!a!e e6ec"te () an a9on! t4e to art#es an FSL

28'

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Re)es vs. "aran

Ban a contract to sell, an not a contract of sale. t as of t4e o#n#on t4at alt4o"!4 t4eet#t#oner as ent#tle to a resc#ss#on of t4e contract, #t co"l not (e er9#tte (eca"se 4ernonDa)9ent #n f"ll of t4e "rc4ase r#ce 9a) not (e cons#ere as s"(stant#al anf"na9ental (reac4 of t4e contract as to efeat t4e o(?ect of t4e art#es #n enter#n! #nto t4econtract. 4e R (el#eve t4at t4e resonentCs offer state #n 4er co"nselCs letter ateSete9(er 2, 1''2 to settle 4at s4e t4o"!4t as 4er "na# (alance of +751,000.00 s4oe4er s#ncer#t) an #ll#n!ness to settle 4er o(l#!at#on. /ence, #t o"l (e 9ore e"#ta(le to!#ve resonent a c4ance to a) t4e (alance l"s #nterest #t4#n a !#ven er#o of t#9e.

F#nall), t4e R state t4at t4ere as no fact"al or le!al (as#s to aar a9a!es anattorne)Cs fees (eca"se t4ere as no roof t4at e#t4er art) acte fra""lentl) or #n (a fa#t4.

4"s, t4e #sos#t#ve ort#on of t4e R -ec#s#on reas>

@/EREFORE, ?"!9ent #s 4ere() renere as follos>

1.Allo#n! t4e efenant to a) t4e la#nt#ff #t4#n t4#rt) <&0= a)s fro9 t4e f#nal#t) 4ereof t4ea9o"nt of +805,000.00, reresent#n! t4e "na# "rc4ase r#ce of t4e s"(?ect roert), #t4#nterest t4ereon at 2 a 9ont4 fro9 Jan"ar) 1, 1''2 "nt#l f"ll) a#. Fa#l"re of t4e efenantto a) sa# a9o"nt #t4#n t4e sa# er#o s4all ca"se t4e a"to9at#c resc#ss#on of t4e contract<-ee of on#t#onal Sale of Real +roert) #t4 Ass"9t#on of ort!a!e= an t4e la#nt#ff ant4e efenant s4all (e restore to t4e#r for9er os#t#ons relat#ve to t4e s"(?ect roert) #t4eac4 ret"rn#n! to t4e ot4er 4atever (enef#ts eac4 er#ve fro9 t4e transact#on3

2. -#rect#n! t4e efenant to allo t4e la#nt#ff to cont#n"e "s#n! t4e sace occ"#e () 4erfor r"!store an cos9et#c store #t4o"t an) rental en#n! a)9ent of t4e aforesa# (alanceof t4e "rc4ase r#ce.

&. Orer#n! t4e efenant, "on 4er f"ll a)9ent of t4e "rc4ase r#ce to!et4er #t4 #nterest,to e6ec"te a contract of lease for

:::::::::::::::

., at . 1;0.

2'0

2'0


Re)es vs. "aran

f#fteen <15= )ears #n favor of t4e la#nt#ff over t4e sace for t4e r"!store an cos9et#c storeat a f#6e 9ont4l) rental of +8,000.003 an

. -#rect#n! t4e la#nt#ff, "on f"ll a)9ent to 4er () t4e efenant of t4e "rc4ase r#ceto!et4er #t4 #nterest, to e6ec"te t4e necessar) ee of sale, as ell as to a) t4e a#tal

8/14/2019 sales (1).rtf


$a#ns a6, oc"9entar) sta9s an ot4er 9#scellaneo"s e6enses necessar) for sec"r#n! t4eBR learance, an to a) t4e real estate ta6es "e on t4e s"(?ect roert) " to 1''0, allnecessar) to transfer oners4# of t4e s"(?ect roert) to t4e efenant.

%o rono"nce9ent as to a9a!es, attorne)Cs fees an costs.

SO OR-ERE-.5

R"l#n! of t4e A

On Fe(r"ar) 1&, 200', t4e A renere #ts ec#s#on aff#r9#n! #t4 9o#f#cat#on t4e R-ec#s#on. 4e A a!ree #t4 t4e R t4at t4e contract entere #nto () t4e art#es #s acontract to sell ("t r"le t4at t4e re9e) of resc#ss#on co"l not al) (eca"se t4eresonentCs fa#l"re to a) t4e et#t#oner t4e (alance of t4e "rc4ase r#ce #n t4e totala9o"nt of +805,000.00 as not a (reac4 of contract, ("t 9erel) an event t4at revente t4eseller <et#t#oner= fro9 conve)#n! t#tle to t4e "rc4aser <resonent=. t reasone t4at o"t oft4e total "rc4ase r#ce of t4e s"(?ect roert) #n t4e a9o"nt of +,200,000.00, resonentCsre9a#n#n! "na# (alance as onl) +805,000.00. S#nce resonent 4a alrea) a# as"(stant#al a9o"nt of t4e "rc4ase r#ce, #t as ("t r#!4t an ?"st to allo 4er to a) t4e"na# (alance of t4e "rc4ase r#ce l"s #nterest. 4"s, t4e ecretal ort#on of t4e A-ec#s#on reas>

@/EREFORE, re9#ses cons#ere, t4e -ec#s#on ate 22 Fe(r"ar) 200; an Orer ate 22-ece9(er 200; of t4e Re!#onal r#al o"rt of ValenH"ela #t), Branc4 172 #n #v#l ase %o.&'5DVD'2 are AFFRE- #t4 O-FAO% #n t4at efenantDaellant V#ctor#a . "aran #s4ere() OR-ERE- to a) la#nt#ffD

:::::::::::::::

5 ., at . 1;2.

2'1

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2'1

Re)es vs. "aran

aelleeWaellant #la A. Re)es, #t4#n &0 a)s fro9 f#nal#t) of t4#s -ec#s#on, t4e a9o"nt of+805,000.00 reresent#n! t4e "na# (alance of t4e "rc4ase r#ce of t4e s"(?ect roert),l"s #nterest t4ereon at t4e rate of ; er ann"9 fro9 11 Sete9(er 1''2 " to f#nal#t) oft4#s -ec#s#on an, t4ereafter, at t4e rate of 12 er ann"9 "nt#l f"ll a)9ent. 4e r"l#n! oft4e tr#al co"rt on t4e a"to9at#c resc#ss#on of t4e -ee of on#t#onal Sale #t4 Ass"9t#on ofort!a!e #s 4ere() -ELEE-. S"(?ect to t4e fore!o#n!, t4e #sos#t#ve ort#on of t4e tr#alco"rtCs ec#s#on #s AFFRE- #n all ot4er resects.

SO OR-ERE-.;

After t4e en#al of et#t#onerCs 9ot#on for recons#erat#on an resonentCs 9ot#on for art#alrecons#erat#on, et#t#oner f#le t4e s"(?ect et#t#on for rev#e ra)#n! for t4e reversal ansett#n! as#e of t4e A -ec#s#on anc4ore on t4e follo#n!

ASS$%E% OF ERRORS

A./E OUR OF A++EALS SEROUSLY ERRE- A%- ABUSE- S -SREO% % -SALLO@%$/E OUR$/ RESSSO% OF /E SUBJE -EE- OF O%-O%AL SALE OF REAL +RO+ERES

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@/ ASSU+O% OF OR$A$E O% /E $ROU%- /A RES+O%-E% U+ARA%CS FALURE O+AY +EO%ER REYES /E BALA%E OF /E +UR/ASE +RE OF +805,000.00 S %O ABREA/ OF O%RA -ES+E S O@% F%-%$S /A +EO%ER SLL REA%SO@%ERS/+ A%- LE OVER /E SUBJE REAL +RO+ERES -UE O RES+O%-E%CS REFUSALO +AY /E BALA%E OF /E OAL +UR/ASE +RE OF +805,000.00 @// S ENUAL O20 OF /E OAL +UR/ASE +RE OF +,200,000.00 OR ;; OF /E S+ULAE- LAS%SALLE% OF +1,200,000.00 +LUS /E %ERES /EREO%. % EFFE, /E OUR OF

A++EALS AFFRE- A%- A-O+E- /E RAL OURCS O%LUSO% /A /E RES+O%-E%CS%O%D+AYE% OF /E

:::::::::::::::

; ., at . 101D102.

2'2

2'2


Re)es vs. "aran

+805,000.00 S O%LY A SL$/ OR ASUAL BREA/ OF O%RA.

B./E OUR OF A++EALS SEROUSLY ERRE- A%- ABUSE- S -SREO% % -SRE$AR-%$AS $ROU%- FOR /E RESSSO% OF /E SUBJE O%RA /E O/ER FRAU-ULE% A%-ALOUS AS OE- BY /E RES+O%-E% A$A%S /E +EO%ER @// BY/ESELVES SUFFE%LY JUSFY A -E%AL OF A $RAE +ERO- OF /RY <&0= -AYS O/E RES+O%-E% @/% @// O +AY O /E +EO%ER /E +805,000.00 +LUS %ERES/EREO%.

.EVE% ASSU%$ AR$UE%-O /A +EO%ER S %O E%LE- O /E RESSSO% OF /ESUBJE O%RA, /E OUR OF A++EALS SLL SEROUSLY ERRE- A%- ABUSE- S-SREO% % RE-U%$ /E %ERES O% /E +805,000.00 O O%LY ; +ER A%%USAR%$ FRO /E -AE OF FL%$ OF /E O+LA% O% SE+EBER 11, 1''2 -ES+E/E +ERSO%AL OE% OF /E RES+O%-E% A%- A$REEE% BE@EE% /E +ARES/A RES+O%-E% @LL +AY %ERES O% /E +805,000.00 A /E RAE OF ; O%/LYSAR%$ /E -AE OF -EL%NUE%Y O% -EEBER &1, 1''1.

-./E OUR OF A++EALS SEROUSLY ERRE- A%- ABUSE- S -SREO% % /EA++REAO% A%-WOR SA++REAO% OF FAS RESUL%$ %O /E -E%AL OF /ELA OF +EO%ER REYES FOR AUAL -AA$ES @// ORRES+O%- O /E LLO%SOF +ESOS OF RE%ALSWFRUS OF /E SUBJE REAL +RO+ERES @// RES+O%-E%U+ARA% OLLEE- O%%UOUSLY S%E -EEBER 1''0, EVE% @/ /E U%+A-BALA%E OF +805,000.00 A%- -ES+E /E FA /A RES+O%-E% -- %O O%ROVERSU/ LA OF /E +EO%ER AS O%A%E- % /ER AE%-E- O+LA% -AE- A+RL

22, 200;.

E./E OUR OF A++EALS SEROUSLY ERRE- A%- ABUSE- S -SREO% % /EA++REAO% OF FAS RESUL%$ %O /E -E%AL OF /E LA OF

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Re)es vs. "aran

+EO%ER REYES FOR /E +2',;0'.00 BA RE%ALS /A @ERE OLLEE- BYRES+O%-E% U+ARA% FRO /E OL- E%A%S OF /E +EO%ER.

F./E OUR OF A++EALS SEROUSLY ERRE- A%- ABUSE- S -SREO% % -E%Y%$ /E+EO%ERCS EARLER UR$E% OO% FOR SSUA%E OF A +REL%ARY A%-AORY A%-+RO/BORY %JU%O% -AE- JULY 7, 2008 A%- /E SU++LEE% /EREO -AE-AU$US , 2008 /EREBY O%-O%%$ /E U%JUSFABLE FALUREWREFUSAL OF JU-$E FLOROALEJO O RESOLVE @/% ELEVE% <11= YEARS /E +EO%ERCS /REE <&= SE+ARAEOO%S FOR +REL%ARY %JU%O%WE+ORARY RESRA%%$ OR-ER, AOU%%$A%- -E+OS OF RE%AL %OE -AE- AR/ 17, 1''5, AU$US 1', 1''; A%- JA%UARY 7,200; /EREBY +ER%$ /E RES+O%-E% O U%JUSLY E%R/ /ERSELF BYO%%UOUSLY OLLE%$ ALL /E RE%ALSWFRUS OF /E SUBJE REAL +RO+ERES@/OU A%Y AOU%%$ A%- OUR -E+OS OF /E OLLEE- RE%ALSWFRUS A%-/E +EO%ERS UR$E% OO% O -RE -EFE%-A% VORA U+ARA% O +AY /EAUULAE- U%+A- REAL ESAE AES A%- SEF AES O% /E SUBJE REAL+RO+ERES -AE- JA%UARY 1&, 2007 /EREBY E+OS%$ /E SUBJE REAL +RO+ERES O%E% AUO% SALE BY /E Y REASURER OF VALE%IUELA Y.

$./E OUR OF A++EALS SEROUSLY ERRE- A%- ABUSE- S -SREO% % -E%Y%$ /E+EO%ERCS LA FOR ORAL A%- EE+LARY -AA$ES A%- AOR%EYCS FEES A$A%S/E RES+O%-E%.

n s"9, t4e cr"c#al #ss"e t4at nees to (e resolve #s 4et4er or not t4e A as correct #nr"l#n! t4at t4ere as no le!al (as#s for t4e resc#ss#on of t4e -ee of on#t#onal Sale #t4Ass"9t#on of ort!a!e.

2'

2'


Re)es vs. "aran

+os#t#on of t4e +et#t#oner

4e et#t#oner (as#call) ar!"es t4at t4e A s4o"l 4ave !rante t4e resc#ss#on of t4e s"(?ect-ee of on#t#onal Sale of Real +roert#es #t4 Ass"9t#on of ort!a!e for t4e follo#n!reasons>

1.4e s"(?ect ee of con#t#onal sale #s a rec#rocal o(l#!at#on 4ose o"tstan#n!c4aracter#st#c #s rec#roc#t) ar#s#n! fro9 #ent#t) of ca"se () v#rt"e of 4#c4 one o(l#!at#on #scorrelat#ve of t4e ot4er.

2.4e et#t#oner as resc#n#n!not enforc#n!t4e s"(?ect -ee of on#t#onal Sale "rs"antto Art#cle 11'1 of t4e #v#l oe (eca"se of t4e resonentCs fa#l"reWref"sal to a) t4e+805,000.00 (alance of t4e total "rc4ase r#ce of t4e et#t#onerCs roert#es #t4#n t4est#"late er#o en#n! -ece9(er &1, 1''1.

&. 4ere as no sl#!4t or cas"al (reac4 on t4e art of t4e resonent (eca"se s4e<resonent= el#(eratel) fa#le to co9l) #t4 4er contract"al o(l#!at#ons #t4 t4e et#t#oner() v#olat#n! t4e ter9s or 9anner of a)9ent of t4e +1,200,000.00 (alance an "n?"stl)enr#c4e 4erself at t4e e6ense of t4e et#t#oner () collect#n! all rental a)9ents for 4erersonal (enef#t an en?o)9ent.

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F"rt4er9ore, t4e et#t#oner cla#9s t4at t4e resonent #s l#a(le to a) #nterest at t4e rate of; er 9ont4 on 4er "na# #nstall9ent of +805,000.00 fro9 t4e ate of t4e el#n"enc),-ece9(er &1, 1''1, (eca"se s4e o(l#!ate 4erself to o so.

F#nall), t4e et#t#oner asserts t4at 4er cla#9 for a9a!es or lost #nco9e as ell as for t4e (acrentals #n t4e a9o"nt of +2',;0'.00 4as (een f"ll) s"(stant#ate an, t4erefore, s4o"l 4ave(een !rante () t4e A. /er cla#9 for 9oral an e6e9lar) a9a!es an attorne)Cs fees 4as

(een l#e#se s"(stant#ate.

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Re)es vs. "aran

+os#t#on of t4e Resonent

4e resonent co"nters t4at t4e s"(?ect -ee of on#t#onal Sale #t4 Ass"9t#on ofort!a!e entere #nto (eteen t4e art#es #s a contract to sell an not a contract of sale(eca"se t4e t#tle of t4e s"(?ect roert#es st#ll re9a#ns #t4 t4e et#t#oner as s4e fa#le to a)t4e #nstall9ent a)9ents #n accorance #t4 t4e#r a!ree9ent.

Resonent ec4oes t4e R os#t#on t4at 4er #na(#l#t) to a) t4e f"ll (alance on t4e "rc4aser#ce 9a) not (e cons#ere as a s"(stant#al an f"na9ental (reac4 of t4e s"(?ect contractan #t o"l (e 9ore e"#ta(le #f s4e o"l (e alloe to a) t4e (alance #ncl"#n! #nterest#t4#n a certa#n er#o of t#9e. S4e cla#9s t4at as earl) as 1''2, s4e 4as s4on 4er s#ncer#t)() offer#n! to a) a certa#n a9o"nt 4#c4 as, 4oever, re?ecte () t4e et#t#oner.

F#nall), resonent states t4at t4e s"(?ect ee of con#t#onal sale e6l#c#tl) rov#es t4at t4e#nstall9ent a)9ents s4all not (ear an) #nterest. oreover, et#t#oner fa#le to rove t4at s4eas ent#tle to (ac rentals.

4e o"rtCs R"l#n!

4e et#t#on lacs 9er#t.

4e o"rt a!rees #t4 t4e r"l#n! of t4e co"rts (elo t4at t4e s"(?ect -ee of on#t#onal Sale#t4 Ass"9t#on of ort!a!e entere #nto () an a9on! t4e to art#es an FSL Ban on%ove9(er 2;, 1''0 #s a contract to sell an not a contract of sale. 4e s"(?ect contract ascorrectl) class#f#e as a contract to sell (ase on t4e follo#n! ert#nent st#"lat#ons>

8.4at t4e t#tle an oners4# of t4e s"(?ect real roert#es s4all re9a#n #t4 t4e F#rst +art)"nt#l t4e f"ll a)9ent of t4e Secon +art) of t4e (alance of t4e "rc4ase r#ce an l#"#at#onof t4e 9ort!a!e o(l#!at#on of +2,000,000.00. +en#n! a)9ent of t4e (alance of t4e "rc4aser#ce an l#"#at#on of t4e 9ort!a!e o(l#!at#on

2';

2';


Re)es vs. "aran

t4at as ass"9e () t4e Secon +art), t4e Secon +art) s4all not sell, transfer an conve)

8/14/2019 sales (1).rtf


an ot4er#se enc"9(er t4e s"(?ect real roert#es #t4o"t t4e r#tten consent of t4e F#rstan 4#r +art).

'.4at "on f"ll a)9ent () t4e Secon +art) of t4e f"ll (alance of t4e "rc4ase r#ce an t4eass"9e 9ort!a!e o(l#!at#on 4ere#n 9ent#one t4e 4#r +art) s4all #ss"e t4e correson#n!-ee of ancellat#on of ort!a!e an t4e F#rst +art) s4all e6ec"te t4e correson#n! -ee ofA(sol"te Sale #n favor of t4e Secon +art).7

Base on t4e a(ove rov#s#ons, t4e t#tle an oners4# of t4e s"(?ect roert#es re9a#ns #t4t4e et#t#oner "nt#l t4e resonent f"ll) a)s t4e (alance of t4e "rc4ase r#ce an t4eass"9e 9ort!a!e o(l#!at#on. 4ereafter, FSL Ban s4all t4en #ss"e t4e correson#n! ee ofcancellat#on of 9ort!a!e an t4e et#t#oner s4all e6ec"te t4e correson#n! ee of a(sol"tesale #n favor of t4e resonent.

Accor#n!l), t4e et#t#onerCs o(l#!at#on to sell t4e s"(?ect roert#es (eco9es e9ana(leonl) "on t4e 4aen#n! of t4e os#t#ve s"sens#ve con#t#on, 4#c4 #s t4e resonentCs f"lla)9ent of t4e "rc4ase r#ce. @#t4o"t resonentCs f"ll a)9ent, t4ere can (e no (reac4 ofcontract to sea of (eca"se et#t#oner 4as no o(l#!at#on )et to t"rn over t4e t#tle.ResonentCs fa#l"re to a) #n f"ll t4e "rc4ase r#ce #s not t4e (reac4 of contractconte9late "ner Art#cle 11'1 of t4e %e #v#l oe ("t rat4er ?"st an event t4at reventst4e et#t#oner fro9 (e#n! (o"n to conve) t#tle to t4e resonent. 4e 200' case of %a("s v. Joa"#n J"l#a +acson8 #s enl#!4ten#n!>

4e o"rt 4ols t4at t4e contract entere #nto () t4e So"ses %a("s an resonents as acontract to sell, not a contract of sale.

A contract of sale #s ef#ne #n Art#cle 158 of t4e #v#l oe, t4"s>

:::::::::::::::

7 e9oran"9 for Resonent, #., at . &'5.

8 $.R. %o. 1;1&18, %ove9(er 25, 200', ;05 SRA &&, &8D&5&.

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Re)es vs. "aran

Art. 158.B) t4e contract of sale, one of t4e contract#n! art#es o(l#!ates 4#9self to transfert4e oners4# of an to el#ver a eter9#nate t4#n!, an t4e ot4er to a) t4erefor a r#cecerta#n #n 9one) or #ts e"#valent.

6 6 6

Sale, () #ts ver) nat"re, #s a consens"al contract (eca"se #t #s erfecte () 9ere consent. 4eessent#al ele9ents of a contract of sale are t4e follo#n!>

a=onsent or 9eet#n! of t4e 9#ns, t4at #s, consent to transfer oners4# #n e6c4an!e for t4er#ce3

(=-eter9#nate s"(?ect 9atter3 an

c=+r#ce certa#n #n 9one) or #ts e"#valent.

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Uner t4#s ef#n#t#on, a ontract to Sell 9a) not (e cons#ere as a ontract of Sale (eca"set4e f#rst essent#al ele9ent #s lac#n!. n a contract to sell, t4e rosect#ve seller e6l#c#tl)reserves t4e transfer of t#tle to t4e rosect#ve (")er, 9ean#n!, t4e rosect#ve seller oesnot as )et a!ree or consent to transfer oners4# of t4e roert) s"(?ect of t4e contract tosell "nt#l t4e 4aen#n! of an event, 4#c4 for resent "roses e s4all tae as t4e f"lla)9ent of t4e "rc4ase r#ce. @4at t4e seller a!rees or o(l#!es 4#9self to o #s to f"lf#ll 4#sro9#se to sell t4e s"(?ect roert) 4en t4e ent#re a9o"nt of t4e "rc4ase r#ce #s el#vere

to 4#9. n ot4er ors, t4e f"ll a)9ent of t4e "rc4ase r#ce artaes of a s"sens#vecon#t#on, t4e nonDf"lf#ll9ent of 4#c4 revents t4e o(l#!at#on to sell fro9 ar#s#n! an, t4"s,oners4# #s reta#ne () t4e rosect#ve seller #t4o"t f"rt4er re9e#es () t4e rosect#ve(")er.

6 6 66 6 66 6 6

State os#t#vel), "on t4e f"lf#ll9ent of t4e s"sens#ve con#t#on 4#c4 #s t4e f"ll a)9ent oft4e "rc4ase r#ce, t4e rosect#ve sellerCs o(l#!at#on to sell t4e s"(?ect roert) () enter#n!#nto a contract of sale #t4 t4e rosect#ve (")er (eco9es e9ana(le as rov#e #n Art#cle17' of t4e #v#l oe 4#c4 states>

Art.17'.A ro9#se to (") an sell a eter9#nate t4#n! for a r#ce certa#n #s rec#rocall)e9ana(le.

An accete "n#lateral ro9#se to (") or to sell a eter9#nate t4#n! for a r#ce certa#n #s(#n#n! "on t4e ro9#ssor #f t4e ro9#se #s s"orte () a cons#erat#on #st#nct fro9 t4er#ce.

2'8

2'8


Re)es vs. "aran


A contract to sell as ef#ne 4ere#na(ove, 9a) not even (e cons#ere as a con#t#onalcontract of sale 4ere t4e seller 9a) l#e#se reserve t#tle to t4e roert) s"(?ect of t4e sale"nt#l t4e f"lf#ll9ent of a s"sens#ve con#t#on, (eca"se #n a con#t#onal contract of sale, t4ef#rst ele9ent of consent #s resent, alt4o"!4 #t #s con#t#one "on t4e 4aen#n! of acont#n!ent event 4#c4 9a) or 9a) not occ"r. f t4e s"sens#ve con#t#on #s not f"lf#lle, t4eerfect#on of t4e contract of sale #s co9letel) a(ate. /oever, #f t4e s"sens#ve con#t#on #sf"lf#lle, t4e contract of sale #s t4ere() erfecte, s"c4 t4at #f t4ere 4a alrea) (een rev#o"sel#ver) of t4e roert) s"(?ect of t4e sale to t4e (")er, oners4# t4ereto a"to9at#call)transfers to t4e (")er () oerat#on of la #t4o"t an) f"rt4er act 4av#n! to (e erfor9e ()

t4e seller.

n a contract to sell, "on t4e f"lf#ll9ent of t4e s"sens#ve con#t#on 4#c4 #s t4e f"ll a)9entof t4e "rc4ase r#ce, oners4# #ll not a"to9at#call) transfer to t4e (")er alt4o"!4 t4eroert) 9a) 4ave (een rev#o"sl) el#vere to 4#9. 4e rosect#ve seller st#ll 4as to conve)t#tle to t4e rosect#ve (")er () enter#n! #nto a contract of a(sol"te sale.

F"rt4er, 4"a v. o"rt of Aeals, c#te t4#s #st#nct#on (eteen a contract of sale an acontract to sell>

n a contract of sale, t4e t#tle to t4e roert) asses to t4e venee "on t4e el#ver) of t4e

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t4#n! sol3 #n a contract to sell, oners4# #s, () a!ree9ent, reserve #n t4e venor an #s notto ass to t4e venee "nt#l f"ll a)9ent of t4e "rc4ase r#ce. Ot4er#se state, #n a contractof sale, t4e venor loses oners4# over t4e roert) an cannot recover #t "nt#l an "nlesst4e contract #s resolve or resc#ne3 4ereas, #n a contract to sell, t#tle #s reta#ne () t4evenor "nt#l f"ll a)9ent of t4e r#ce. n t4e latter contract, a)9ent of t4e r#ce #s a os#t#ves"sens#ve con#t#on, fa#l"re of 4#c4 #s not a (reac4 ("t an event t4at revents t4e o(l#!at#onof t4e venor to conve) t#tle fro9 (eco9#n! effect#ve.

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Re)es vs. "aran

t #s not t4e t#tle of t4e contract, ("t #ts e6ress ter9s or st#"lat#ons t4at eter9#ne t4e #nof contract entere #nto () t4e art#es. n t4#s case, t4e contract ent#tle -ee of on#t#onalSale #s act"all) a contract to sell. 4e contract st#"late t4at as soon as t4e f"ll

cons#erat#on of t4e sale 4as (een a# () t4e venee, t4e correson#n! transfer oc"9entss4all (e e6ec"te () t4e venor to t4e venee for t4e ort#on sol. @4ere t4e venorro9#ses to e6ec"te a ee of a(sol"te sale "on t4e co9let#on () t4e venee of t4ea)9ent of t4e r#ce, t4e contract #s onl) a contract to sell. 4e aforec#te st#"lat#on s4ost4at t4e venors reserve t#tle to t4e s"(?ect roert) "nt#l f"ll a)9ent of t4e "rc4aser#ce.

6 6 6

Unfort"natel) for t4e So"ses +acson, s#nce t4e -ee of on#t#onal Sale e6ec"te #n t4e#rfavor as 9erel) a contract to sell, t4e o(l#!at#on of t4e seller to sell (eco9es e9ana(leonl) "on t4e 4aen#n! of t4e s"sens#ve con#t#on. 4e f"ll a)9ent of t4e "rc4ase r#ce #st4e os#t#ve s"sens#ve con#t#on, t4e fa#l"re of 4#c4 #s not a (reac4 of contract, ("t s#9l)an event t4at revente t4e o(l#!at#on of t4e venor to conve) t#tle fro9 ac"#r#n! (#n#n!force. 4"s, for #ts nonDf"lf#l9ent, t4ere #s no contract to sea of, t4e o(l#!or 4av#n! fa#le to

erfor9 t4e s"sens#ve con#t#on 4#c4 enforces a ?"r##cal relat#on. @#t4 t4#s c#rc"9stance,t4ere can (e no resc#ss#on or f"lf#ll9ent of an o(l#!at#on t4at #s st#ll nonDe6#stent, t4es"sens#ve con#t#on not 4av#n! occ"rre as )et. E94as#s s4o"l (e 9ae t4at t4e (reac4conte9late #n Art#cle 11'1 of t4e %e #v#l oe #s t4e o(l#!orCs fa#l"re to co9l) #t4 ano(l#!at#on alrea) e6tant, not a fa#l"re of a con#t#on to rener (#n#n! t4at o(l#!at#on.E94ases an "nerscor#n! s"l#eG

ons#stentl), t4e o"rt 4ane on a s#9#lar r"l#n! #n t4e 2010 case of /e#rs of At#enHa v.Es#ol,' 4ere #t as r#tten>

Re!ar#n! t4e r#!4t to cancel t4e contract for nonDa)9ent of an #nstall9ent, t4ere #s nee to#n#t#all) eter9#ne #f 4at t4e art#es 4a as a contract of sale or a contract to sell. n acontract of sale, t4e t#tle to t4e roert) asses to

:::::::::::::::

' $.R. %o. 180;;5, A"!"st 11, 2010, ;28 SRA 25;, 2;2D2;&.

&00

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&00


Re)es vs. "aran

t4e (")er "on t4e el#ver) of t4e t4#n! sol. n a contract to sell, on t4e ot4er 4an, t4e

oners4# #s, () a!ree9ent, reta#ne () t4e seller an #s not to ass to t4e venee "nt#l f"lla)9ent of t4e "rc4ase r#ce. n t4e contract of sale, t4e (")erCs nonDa)9ent of t4e r#ce #sa ne!at#ve resol"tor) con#t#on3 #n t4e contract to sell, t4e (")erCs f"ll a)9ent of t4e r#ce #sa os#t#ve s"sens#ve con#t#on to t4e co9#n! #nto effect of t4e a!ree9ent. n t4e f#rst case,t4e seller 4as lost an cannot recover t4e oners4# of t4e roert) "nless 4e taes act#on toset as#e t4e contract of sale. n t4e secon case, t4e t#tle s#9l) re9a#ns #n t4e seller #f t4e(")er oes not co9l) #t4 t4e con#t#on receent of 9a#n! a)9ent at t4e t#9e sec#f#e#n t4e contract. /ere, #t #s "#te ev#ent t4at t4e contract #nvolve as one of a contract to sells#nce t4e At#enHas, as sellers, ere to reta#n t#tle of oners4# to t4e lan "nt#l resonentEs#ol, t4e (")er, 4as a# t4e a!ree r#ce. nee, t4ere see9s no "est#on t4at t4e art#es"nerstoo t4#s to (e t4e case.

A9#ttel), Es#ol as "na(le to a) t4e secon #nstall9ent of +1,750,000.00 t4at fell "e #n-ece9(er 2002. 4at a)9ent, sa# (ot4 t4e R an t4e A, as a os#t#ve s"sens#vecon#t#on fa#l"re of 4#c4 as not re!are a (reac4 #n t4e sense t4at t4ere can (e no

resc#ss#on of an o(l#!at#on <to t"rn over t#tle= t4at # not )et e6#st s#nce t4e s"sens#vecon#t#on 4a not taen lace. 6 6 6. E94ases an "nerscor#n! s"l#eG

4"s, t4e o"rt f"ll) a!rees #t4 t4e A 4en #t resolve> ons#er#n!, 4oever, t4at t4e-ee of on#t#onal Sale as not cancelle () Venor Re)es <et#t#oner= an t4at o"t of t4etotal "rc4ase r#ce of t4e s"(?ect roert) #n t4e a9o"nt of +,200,000.00, t4e re9a#n#n!"na# (alance of "aran <resonent= #s onl) +805,000.00, a s"(stant#al a9o"nt of t4e"rc4ase r#ce 4as alrea) (een a#. t #s onl) r#!4t an ?"st to allo "aran to a) t4e sa#"na# (alance of t4e "rc4ase r#ce to Re)es.10

$rant#n! t4at a resc#ss#on can (e er9#tte "ner Art#cle 11'1, t4e o"rt st#ll cannot allo #tfor t4e reason t4at, cons#er#n! t4e c#rc"9stances, t4ere as onl) a sl#!4t or cas"al (reac4 #nt4e f"lf#ll9ent of t4e o(l#!at#on.

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10 A -ec#s#on, Rollo, . 100.

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Re)es vs. "aran

Unless t4e art#es st#"late #t, resc#ss#on #s alloe onl) 4en t4e (reac4 of t4e contract #ss"(stant#al an f"na9ental to t4e f"lf#ll9ent of t4e o(l#!at#on. @4et4er t4e (reac4 #s sl#!4tor s"(stant#al #s lar!el) eter9#ne () t4e attenant c#rc"9stances.11 n t4e case at (enc4,t4e s"(?ect contract st#"late t4e follo#n! #9ortant rov#s#ons>

2.4at t4e "rc4ase r#ce of +,200,000.00 s4all (e a# as follos>

a=+278,078.1& rece#ve #n cas4 () t4e F#rst +art) ("t #rectl) a# to t4e 4#r +art) as art#ala)9ent of t4e 9ort!a!e o(l#!at#on of t4e F#rst +art) #n orer to re"ce t4e a9o"nt to

8/14/2019 sales (1).rtf


+2,000,000.00 onl) as of %ove9(er 15, 1''03

(=+721,'21.87 rece#ve #n cas4 () t4e F#rst +art) as a#t#onal a)9ent of t4e Secon +art)3

c=+1,200,000.00 to (e a# #n #nstall9ents as follos>

1.+200,000.00 a)a(le on or (efore Jan"ar) &1,

1''13

2.+200,000.00 a)a(le on or (efore J"ne &0, 1''13

&.+800,000.00 a)a(le on or (efore -ece9(er &1,

1''13

%ote> All t4e #nstall9ents s4all not (ear an)

#nterest.

= +2,000,000.00 o"tstan#n! (alance of t4e 9ort!a!e o(l#!at#on as of %ove9(er 15, 1''04#c4 #s 4ere() ass"9e () t4e Secon +art).

6 6 6

&. 4at t4e 4#r +art) 4ere() acnole!es rece#ts fro9 t4e Secon +art) +278,078.1& asart#al a)9ent of t4e loan o(l#!at#on of F#rst +art) #n orer to re"ce t4e acco"nt to onl)+2,000,000.00 as of %ove9(er 15, 1''0 to (e ass"9e () t4e Secon +art) effect#ve%ove9(er 15, 1''0.12

Fro9 t4e recors, #t cannot (e en#e t4at resonent a# to FSL Ban et#t#onerCs 9ort!a!eo(l#!at#on #n t4e a9o"nt

:::::::::::::::

11 $$ Sortsear f!. or. v. @orl lass +roert#es, nc., $.R. %o. 182720, arc4 2, 2010,;1 SRA 75, 87.

12 Rollo, . 25D2;.

&02

&02


Re)es vs. "aran

of +2,278,078.1&, 4#c4 for9e art of t4e "rc4ase r#ce of t4e s"(?ect roert). L#e#se, #t#s not #s"te t4at resonent a# #rectl) to et#t#oner t4e a9o"nt of +721,'21.87reresent#n! t4e a#t#onal a)9ent for t4e "rc4ase of t4e s"(?ect roert). learl), o"t oft4e total r#ce of +,200,000.00, resonent as a(le to a) t4e total a9o"nt of+&,000,000.00, leav#n! a (alance of +1,200,000.00 a)a(le #n t4ree <&= #nstall9ents.

O"t of t4e +1,200,000.00 re9a#n#n! (alance, resonent a# on several ates t4e f#rst ansecon #nstall9ents of +200,000.00 eac4. S4e, 4oever, fa#le to a) t4e t4#r an last#nstall9ent of +800,000.00 "e on -ece9(er &1, 1''1. %evert4eless, on A"!"st &1, 1''2,

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resonent, t4ro"!4 co"nsel, offere to a) t4e a9o"nt of +751,000.00, 4#c4 as re?ecte() et#t#oner for t4e reason t4at t4e act"al (alance as +805,000.00 e6cl"#n! t4e #nterestc4ar!es.

ons#er#n! t4at o"t of t4e total "rc4ase r#ce of +,200,000.00, resonent 4as alrea) a#t4e s"(stant#al a9o"nt of +&,00,000.00, 9ore or less, leav#n! an "na# (alance of onl)+805,000.00, #t #s r#!4t an ?"st to allo 4er to settle, #t4#n a reasona(le er#o of t#9e, t4e

(alance of t4e "na# "rc4ase r#ce. 4e o"rt a!rees #t4 t4e co"rts (elo t4at t4eresonent s4oe 4er s#ncer#t) an #ll#n!ness to co9l) #t4 4er o(l#!at#on 4en s4eoffere to a) t4e et#t#oner t4e a9o"nt of +751,000.00.

On t4e #ss"e of #nterest, et#t#oner fa#le to s"(stant#ate 4er cla#9 t4at resonent 9ae aersonal co99#t9ent to a) a ; 9ont4l) #nterest on t4e +805,000.00 fro9 t4e ate ofel#n"enc), -ece9(er &1, 1''1. As can (e !leane fro9 t4e contract, t4ere as a st#"lat#onstat#n! t4at> All t4e #nstall9ents s4all not (ear #nterest. 4e A as, 4oever, correct #n#9os#n! #nterest at t4e rate of ; er ann"9 start#n! fro9 t4e f#l#n! of t4e co9la#nt onSete9(er 11, 1''2.

F#nall), t4e o"rt "4ols t4e r"l#n! of t4e co"rts (elo re!ar#n! t4e nonD#9os#t#on ofa9a!es an attorne)Cs fees.

&0&

VOL. ;50, JU%E 1, 2011

&0&

Re)es vs. "aran

As#e fro9 et#t#onerCs selfDserv#n! state9ents, t4ere #s not eno"!4 ev#ence on recor torove t4at resonent acte fra""lentl) an 9al#c#o"sl) a!a#nst t4e et#t#oner. n t4e case of/e#rs of At#enHa v. Es#ol,1& #t as state>

Resonents are not ent#tle to 9oral a9a!es (eca"se contracts are not referre to #n

Art#cle 221' of t4e #v#l oe, 4#c4 en"9erates t4e cases 4en 9oral a9a!es 9a) (erecovere. Art#cle 2220 of t4e #v#l oe allos t4e recover) of 9oral a9a!es #n (reac4es ofcontract 4ere t4e efenant acte fra""lentl) or #n (a fa#t4. /oever, t4#s case #nvolves acontract to sell, 4ere#n f"ll a)9ent of t4e "rc4ase r#ce #s a os#t#ve s"sens#ve con#t#on,t4e nonDf"lf#ll9ent of 4#c4 #s not a (reac4 of contract, ("t 9erel) an event t4at revents t4eseller fro9 conve)#n! t#tle to t4e "rc4aser. S#nce t4ere #s no (reac4 of contract #n t4#s case,resonents are not ent#tle to 9oral a9a!es.

n t4e a(sence of 9oral, te9erate, l#"#ate or co9ensator) a9a!es, e6e9lar) a9a!escannot (e !rante for t4e) are alloe onl) #n a#t#on to an) of t4e fo"r #ns of a9a!es9ent#one.

@/EREFORE, t4e et#t#on #s -E%E-.

SO OR-ERE-.

ar#o <4a#rerson=, %ac4"ra, +eralta an A(a, JJ., conc"r.

+et#t#on en#e.

%ote."t"al rest#t"t#on #s re"#re #n cases #nvolv#n! resc#ss#on "ner Art#cle 11'1. <UnlaReso"rces -evelo9ent ororat#on vs. -ra!on, 5;0 SRA ;& 2008G=

o0o Re)es vs. "aran, ;50 SRA 28&<2011=G

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2.contract to sell

VOL. 258, JULY 5, 1'';

&17

SalaHar vs. o"rt of Aeals

$.R. %o. 11820&. J"l) 5, 1'';.*

ELO A. SALAIAR an ERESA -IO%, et#t#oners, vs. OUR OF A++EALS an JO%EEBORRES, resonents.

#v#l La3 Sales3 -#st#nct#on (eteen ontract of Sale an ontract to Sell.n a contract ofsale, t4e t#tle to t4e roert) asses to t4e venee "on t4e el#ver) of t4e t4#n! sol3 #n acontract to sell, oners4# #s, () a!ree9ent, reserve #n t4e venor an #s not to ass to t4evenee "nt#l f"ll a)9ent of t4e "rc4ase r#ce. Ot4er#se state, #n a contract of sale, t4evenor loses oners4# over t4e roert) an cannot recover #t "nt#l an "nless t4e contract#s resolve or resc#ne3 4ereas #n a contract to sell, t#tle #s reta#ne () t4e venor "nt#l f"lla)9ent of t4e r#ce. n t4e latter contract, a)9ent of t4e r#ce #s a os#t#ve s"sens#vecon#t#on, fa#l"re of 4#c4 #s not a (reac4 ("t an event t4at revents t4e o(l#!at#on of t4evenor to conve) t#tle fro9 (eco9#n! effect#ve.

Sa9e3 Sa9e3 4e for9 of t4e #nstr"9ent cannot reva#l over t4e tr"e #ntent of t4e art#es asesta(l#s4e () t4e ev#ence.Uno"(tel), SalaHar an Borres 9"t"all) a!ree t4at es#tet4e -ee of A(sol"te Sale t#tle to t4e to lots #n "est#on as not to ass to t4e latter "nt#lf"ll a)9ent of t4e cons#erat#on of +1 9#ll#on. 4e for9 of t4e #nstr"9ent cannot reva#l overt4e tr"e #ntent of t4e art#es as esta(l#s4e () t4e ev#ence.



+"r"!anan, 4ato, an $eron#9o La Off#ces for et#t#oners.

Este(an B. Ba"t#sta for r#vate resonent.

-AV-E, JR., J.>

+et#t#oners see to set as#e t4e ec#s#on1 of 2' %ove9(er

::::::::::::::::::::::::::::::

* /R- -VSO%.

1 Rollo, 0D;. +er snan#, A., J., #t4 (a)DSo9era, ., an L#anaDRe)es, ., JJ., conc"rr#n!.

&18

&18


8/14/2019 sales (1).rtf



1'' of t4e o"rt of Aeals #n AD$.R. V %o. 01'7, 4#c4 reverse t4e ec#s#on2 of &Sete9(er 1''2 of Branc4 ;; of t4e Re!#onal r#al o"rt <R= of aat#, etro an#la, #n #v#lase %o. 8'D;8.

4e r#9ar) #ss"es resente for o"r resol"t#on are 4et4er <a= t4e soDcalle -ee of A(sol"te

Sale e6ec"te () et#t#oner E9#l#o A. SalaHar #n favor of r#vate resonent Jonette Borres #s aerfecte contract of sale or a 9ere contract to sell, an <(= t4e act#on for sec#f#cerfor9ance 4#c4 t4e latter f#le #ll l#e to co9el t4e for9er to el#ver t4e -ee of A(sol"teSale, t4e ransfer ert#f#cates of #tle, an ot4er oc"9ents relat#ve to t4e roert) #n"est#on.

4e fact"al anteceents of t4#s case, as s"99ar#He () t4e tr#al co"rt, are as follos>

4at efenant -r. SalaHar #s t4e oner of t4e to <2= arcels of lan #t4 #9rove9entst4ereon locate at 2'1 F#nlan#a Street, aat#, etro an#la an covere () ransferert#f#cate of #tle %os. &10&8 an &10&' of t4e Re!#str) of -ees of aat#3 t4at -r. SalaHaroffere to sell 4#s roert#es to Jonette Borres for One #ll#on +esos <+1,000,000.00= <S%, .7 an 8, %ove9(er 5, 1''1=. 4e #n#t#al roosal too lace at t4e -#9s"9 Resta"rant, aat#,4ere() #t as roose t4at t4e a)9ent of t4e cons#erat#on as to (e 9ae #t4#n s#6 <;=9ont4s ("t as o(?ecte to () -r. SalaHar an 4e re"ce #t to a t4ree <&= 9ont4s er#o

<S%, -#rect E6a9#nat#on on Jonette Borres, . 22, %ove9(er 12, 1''1=3 t4at so9et#9e ona)G 28, 1'8', Jonette Borres to!et4er #t4 a certa#n E9#l#o . SalaHar ent to see -r. SalaHarat t4e latterCs res#ence #n Bataan (ear#n! a co) of a -ee of A(sol"te Sale <E64#(#t = an-ee of @arrant) <E64#(#t -= ("t -r. SalaHar ref"se to s#!n (eca"se Jonette Borres # not4ave t4e 9one) rea) t4en. n sa# occas#on -r. SalaHar f"rt4er re"ce t4e er#o #t4#n4#c4 la#nt#ff 9a) "rc4ase t4e lots, to one <1= 9ont4 or " to J"ne &0, 1'8' <S%, -#rectE6a9#nat#on on Jonette Borres, %ove9(er 5, 1''1G, . 10 an 11=.

Jonette Borres t4en 9et a!a#n -r. SalaHar on J"ne 2, 1'8' at t4e %#no) nternat#onal A#rort4o as a(o"t to leave for t4e Un#te States of A9er#ca 4ere 4e #s a res#ent. Jonette Borres4a

::::::::::::::::::::::::::::::

2 Or#!#nal Recors <OR= 28;D2'5. +er J"!e Er#(erto U. Rosar#o, Jr.

&1'

VOL. 258, JULY 5, 1'';

&1'


#t4 4er t4e -ee of A(sol"te Sale an ase -r. SalaHar to s#!n sa# oc"9ent. -r. SalaHarrel"ctantl) a!ree to s#!n t4e oc"9ent rov#e t4at Jonette Borres a)s one 4alf <1W2= of t4econs#erat#on or +500,000.00 #n cas4 () J"ne 15, 1'8' an t4e (alance as a)a(le on J"ne&0, 1'8' <S%, -#rect E6a9#nat#on on E9#l#o A. SalaHar, a) 21, 1''1G, . '3 S%, rossE6a9#nat#on on Jonette Borres, %ove9(er 12, 1''1G, . 2' an &0=. t as "r#n! t4#soccas#on t4at -r. SalaHar a!a#n e94as#He to Jonette Borres t4at 4e neee t4e 9one)(eca"se 4e as t4en (")#n! a roert) #n t4e Un#te States <S%, . 15D20, %ove9(er 5,1''13 . 22 an 2&, a) 21, 1''13 an, . 5;D57, a) 21, 1''1=.

+la#nt#ff a!ree to t4e a(ove con#t#ons <S%, ross E6a9#nat#on on Jonette Borres, %ove9(er

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12, 1'8', . &2= an -r. SalaHar const#t"te coDefenant eresa -#Hon as c"sto#an at t4e-ee of A(sol"te Sale <E64#(#t = to!et4er #t4 t4e #tles of t4e Lan #n "est#on #t4 t4e#nstr"ct#on to eresa -#Hon not to s"rrener sa# oc"9ents to Jonette Borres "nt#l "ona)9ent of t4e f"ll r#ce #n cas4 <S%, -#rect E6a9#nat#on on E9#l#o A. SalaHar, a) 21,1''1G, . 11=.

On J"ne 1, 1'8' Jonette Borres #nfor9e efenant -#Hon t4at s4e #ll (e a(le to a) t4e f"ll

a9o"nt of +1,000,000.00 on J"ne 15, 1'8' <S%, -#rect E6a9#nat#on Jonette Borres, %ove9(er5, 1''1G, . 25= an on t4e ne6t a), s4e t4en ent to t4e 4o"se of eresa -#Hon to see an!et t4e oc"9ents entr"ste to 4er () -r. SalaHar. 4e oc"9ents not (e#n! #n -#HonCsossess#on, t4e) a!ree to 9eet at etro Ban @est Aven"e Branc4 to !et t4e oc"9ents ant4en to rocee to aat# to 9eet t4e la#nt#ffCs ("s#ness artner a certa#n Balao 4oalle!el) !ave la#nt#ff a Far East Ban an r"st o9an) c4ec for t4e a9o"nt of+1,500,000.00 <E64#(#t F= #t4 4#c4 to (") t4e roert) <S%, -#rect E6a9#nat#on on Jonette Borres, %ove9(er 5, 1''1G, . &0, &2 an &&=. For so9e reason or anot4er JonetteBorres an efenant -#Hon fa#le to rocee to aat#.

n t4e 9eant#9e or on J"ne 1;, 1''2, -r. SalaHar 9ae an overseas call to coDefenant -#Honto #n"#re #f Jonette Borres 4a alrea) a# t4e on a)9ent of +500,000.00 an eresa-#Hon rel#e to -r. SalaHar t4at Jonette Borres 4a not a# t4e on a)9ent. -r. SalaHart4en orere -#Hon to sto t4e sale <S%, -#rect E6a9#nat#on on E9#l#o A. SalaHar, a) 21,1''1G, . 12 an 1&=.

&20

&20



As 9a) (e seen fro9 t4e ev#ence resente () t4e la#nt#ff an t4e efenants, t4e ter9san con#t#ons of t4e a!ree9ent for t4e sale of t4e to <2= arcels of lan one () -r.SalaHar #n favor of t4e la#nt#ff Jonette Borres, are t4at t4e "rc4ase r#ce #s #n t4e a9o"nt of

+1,000,000.00, f#ft) ercent <50= of 4#c4 or +500,000.00 as to (e a# on or (efore J"ne15, 1'8' 4#le t4e (alance t4ereof as to (e a# on or (efore J"ne &0, 1'8' <S%, a) 21,1''1, . 27=3 t4at t4e a)9ent as to (e 9ae #n cas4 <S%, a) 21, 1''1, . 55=3 t4at t4elace of a)9ent #s at efenantCs (an, etrool#tan Ban N"eHon #t) Branc4 <S%, Octo(er21, 1''1, . 2&=.&

4e tr#al co"rt 4el t4at t4e -ee of A(sol"te Sale as #n real#t) a contract to sell, an t4ats#nce Borres fa#le to a) SalaHar t4e ona)9ent of +500,000.00 on t4e a!ree ate, 15 J"ne 1'8', t4e co9la#nt for sec#f#c erfor9ance cannot roser. t t4en #s9#sse t4eco9la#nt an orere Borres to a) t4e et#t#oners +5,000.00 eac4 as attorne)Cs fees anl#t#!at#on e6enses.

n r"l#n! t4at t4e -ee of A(sol"te Sale as a contract to sell, t4e tr#al co"rt cons#ereert#nent t4e c#rc"9stances atten#n! #ts e6ec"t#on. F#rst, t4at t4e -ee of A(sol"te Sale as

rel"ctantl) s#!ne () -r. SalaHar, 4o as t4en a(o"t to leave for t4e Un#te States ofA9er#ca, #n orer t4at #f Borres o"l co9l) #t4 t4e ter9s an con#t#ons of t4e#ra!ree9ent, 4e nee not co9e to t4e +4#l##nes ?"st to s#!n #t3 4ence, #t oes not (#n -r.SalaHar "nt#l t4e s"sens#ve con#t#on, #.e., t4e ona)9ent of +500,000.00 to (e effecte onor (efore 15 J"ne 1'8' an t4e (alance to (e a# on or (efore &0 J"ne 1'8', #s co9l#e #t4.Secon, Borres as not, #n fact, f#nanc#all) reare to (") t4e arcels of lan on or (efore 15 J"ne 1'8' cons#er#n! t4at

sG4e as ?"st loo#n! for oss#(le (")ers or ("s#ness artners. F#rst, s4e re"este t4at t4eert#nent oc"9ents l#e t4e -ee of Sale <E64#(#t = an t4e correson#n! ransferert#f#cates of #tles %os. &10&8 an &10&' of t4e Re!#ster of -ees of R#Hal <E64#(#ts A an

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B= (e entr"ste to 4er even (efore 9a#n! t4e ona)9ent

::::::::::::::::::::::::::::::

& OR, 287D2'1.

., 2'D2'5.

&21

VOL. 258, JULY 5, 1'';

&21


of +500,000.00 "rosel) to ra#se t4e a9o"nt neee. @4en -r. SalaHar ref"se 4er re"est,

Jonette Borres aroac4e a certa#n ("s#ness9an +.-. -#on#s#o for loan an as t"rne on4en Jonette Borres cannot s#cG ro"ce t4e -ee of A(sol"te Sale an t4e #tles of t4earcels of lan #n "est#on <S%, %ove9(er 5, 1''1, . 20D25=. 4en s4e aroac4e a certa#nBen?a9#n Balao a realtor eveloer. Alt4o"!4 Balao 4a #ss"e to 4er 4#s c4ec #n t4e a9o"ntof +1,500,000.00 <E64#(#t F= 4e #nstr"cte 4#s (an not to 4onor 4#s c4ec #t4o"t 4#sresence <S%, %ove9(er 1, 1''1, . 81 to 8=. Jonette Borres a9#tte t4at s4e as not #na os#t#on to encas4 t4e c4ec <E64#(#t F= alt4o"!4 #t as a)a(le to Qcas4C <S%, %ove9(er21, 1''1, . 1 an =.5

SalaHarCs v#ctor) as s4ortDl#ve. On BorresCs aeal fro9 t4e ec#s#on of t4e tr#al co"rt, t4eo"rt of Aeals, #n #ts c4allen!e ec#s#on of 2' %ove9(er 1'', r"le t4at t4e -ee ofA(sol"te Sale, 4ose e6#stence an "e e6ec"t#on as "n#s"te, #s a erfecte contract ofsale, #t4 a ef#n#te o(?ect an a sec#f#c cons#erat#on 4#c4 t4e art#es 4a a!ree "on. Asroof t4at #t #s a contract of sale an not a contract to sell, t4e o"rt of Aeals stresse t4ea(sence of a rov#so t4at t4e t#tle to t4e roert) #s reserve #n t4e venor "nt#l f"ll a)9entof t4e "rc4ase r#ce or t4at t4e venor 9a) "n#laterall) resc#n t4e contract t4e 9o9ent t4evenee fa#ls to a) #t4#n t4e f#6e er#o.; SalaHarCs rel"ctance to s#!n #t #s of no 9o9ent,s#nce t4ere #s no alle!at#on of fra", for!er), or "ress. An even ass"9#n! t4at Borres fa#leto a) t4e contract r#ce, s"c4 fa#l"re # not convert t4e contract #nto one #t4o"t ca"se orcons#erat#on as to v#t#ate t4e val##t) of t4e contract, #t not (e#n! essent#al for t4e e6#stenceof ca"se t4at a)9ent or f"ll a)9ent (e 9ae at t4e t#9e of t4e contract. %e#t4er # s"c4fa#l"re #so facto resolve t4e contract #n "est#on. 4e re9e) of t4e venor, -r. E9#l#o A.SalaHar, #s to e9an sec#f#c erfor9ance or resc#ss#on, #t4 a9a!es #n e#t4er case. On t4eot4er 4an, t4e venee, Jonette Borres, 9a) e9an sec#f#c erfor9ance, #.e., co9el t4evenor to

::::::::::::::::::::::::::::::

5 OR, 2'&D2'.

; #t#n! V#sa)an Sa9#ll o., nc. vs. o"rt of Aeals, 21' SRA &78 1''&G.

&22

&22

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accet t4e r#ce an el#ver t4e t#tle of t4e lan o(?ect of t4e contract.

4e o"rt of Aeals #sa!ree #t4 t4e tr#al co"rtCs f#n#n! t4at Borres as not #n a os#t#on

to a) t4e ona)9ent (eca"se

oGn J"ne 15, 1'8', la#nt#ffDaellant 4a a Far East Ban c4ec a)a(le to 4er orer, #n t4ea9o"nt of +1,500,000.009ore t4an t4e 4ole a!ree "rc4ase r#ce of +1,000,000.00.-efenantDaellee eresa -#Hon a!ree <on J"ne 1, 1'8'= to 9eet 4er on J"ne 15, 1'8', atetro Ban @est an t4ereafter to rocee to aat# #n orer to encas4 t4e Far East Banc4ec. -efenantDaellee eresa -#Hon so9e4o 9ana!e to 9an#"late t4#n!s () 9a#n!4erself "nava#la(le so t4at t4e a)9ent co"l not (e 9ae on J"ne 15, 1'8'. <S%, %ov. 5,1''1, . 27D1=. On t4e ne6t a), J"ne 1;, 1'8', efenantDaellee eresa -#Hon #nfor9ela#nt#ffDaellant t4at efenantDaellee -r. E9#l#o A. SalaHar calle " #n t4e even#n! of J"ne 15, 1'8' as#n! 4et4er la#nt#ffDaellant a# on t4at a) an "on (e#n! ansere #nt4e ne!at#ve, sa# venor sa# t4at 4e #s revo#n! t4e contract. <S%, %ov. 5, 1''1, . 1D2=.-efenantDaellee eresa -#Hon 4av#n! 4er on #ntereste (")er, ev#entl) acte #n (afa#t4, tr#e an #nee s"cceee to fr"strate t4e efforts of la#nt#ffDaellant to co9l) #t44er rec#rocal o(l#!at#on to a) t4e a!ree "rc4ase r#ce.

4e fact t4at t4e Far East Ban c4ec as a)a(le to t4e Orer of la#nt#ffDaellant, an #tcovers t4e a9o"nt of +1,500,000.004#c4 #s 9"c4 9ore t4an t4e a!ree "rc4ase r#ce of+1,000,000.00reveals t4at la#nt#ffDaellant as f#nanc#all) reare to co9l) #t4 4errec#rocal o(l#!at#on. 4at la#nt#ffDaellant f#le t4e resent s"#t for sec#f#c erfor9ance on J"l) ;, 1'8', (olsters t4e fact t4at s4e #s reall) #ll#n! an a(le to a) t4e a!ree "rc4aser#ce. /o an fro9 4o9 s4e (orroeWo(ta#ne t4e sa# a9o"nt, #s of no conse"ence.7

Accor#n!l), t4e resonent o"rt reverse t4e ec#s#on of t4e tr#al co"rt an 4ane on ane ?"!9ent orer#n! E9#l#o A. SalaHar to accet fro9 Jonette Borres t4e a)9entreresent#n! t4e "rc4ase r#ce #n t4e a9o"nt of +1 9#ll#on

::::::::::::::::::::::::::::::

7 Rollo, D5.

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an t4ereafter to co9l) #t4 4#s rec#rocal o(l#!at#on to s"rrener t4e or#!#nal co#es of t4eee of a(sol"te sale an torrens t#tle cover#n! t4e arcels of lan s"(?ect of t4e contract.F#n#n! et#t#oner eres#ta -#Hon to 4ave acte #n (a fa#t4 #n fr"strat#n! t4e efforts ofBorres to co9l) #t4 4er o(l#!at#on to a) t4e "rc4ase r#ce, t4e aellate co"rt orere4er to a) Borres t4e a9o"nts of +80,000.00 as 9oral a9a!es3 +50,000.00 as e6e9lar)a9a!es3 an +100,000.00 as attorne)Cs fees.

Una(le to accet t4e reversal of t4e tr#al co"rtCs ec#s#on, t4e et#t#oners f#le t4e #nstantet#t#on 4ere#n t4e) s"(9#t t4at t4e o"rt of Aeals co99#tte !rave an ser#o"s errors>

A. 6 6 6 #n rel)#n! on t4e -ee of A(sol"te Sale ate a) &0, 1'8' not#t4stan#n! t4e fact

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t4at>

1. BORRES EEUE- A -EE- OF @ARRA%Y <E/S. - A%- 2= SA%$ /ERE% /AU%L A%- U%LESS /E AOU% OF +1,000,000.00 RE+RESE%%$ /E +UR/ASE +RE FOR/A +ARELS OF LA%- OVERE- BY %OS. SD&10&8 A%- SD&10&' BE +A- BY /ER OSALAIAR, S/E /AS %O R$/ @/ASOEVER O /E OR$%AL O+ES OF /E -EE- OFABSOLUE SALE A%- /A S/E /AS %O LE$AL R$/ @/ASOEVER O A%Y A%- ALL

+ER%E% REOR-S OF /E ABOVEDE%O%E- LOS3

2. U+O% /ER BE/ES, BORRES @AS $VE% A +/OOO+Y OF /E -EE- OF ABSOLUE SALE BY-IO% BU O%LY AFER /E LAER ERASE- /E S$%AURE OF SALAIAR AS /E VE%-EE/ERE%.

&. BORRES /A- %O +A- A%Y +ORO% OF /E A$REE- +UR/ASE +RE A%- /US RE%-ERS/E -EE- OF ABSOLUE SALE VO- AB %O.

B. 6 6 6 #n concl"#n! t4at t4e a!ree9ent (eteen SALAIAR an BORRES #s a contract of salean t4"s, erfecte "on a!ree9ent on t4e s"(?ect 9atter an cons#erat#on, not#t4stan#n!t4e fact t4at>

1. /E A$REEE% BE@EE% /E +ARES S ESSE%ALLY A O%RA O SELL SUBJE O ASUS+E%SVE O%-O%, /E BR/ OR EFFEVY

&2

&2



OF @// S/OUL- AE +LAE O%LY F A%- @/E% /E EVE% @// O%SUES /EO%-O% /A++E%S OR S FULFLLE-. S%E BORRES FALE- O O+LY @/ /EROBL$AO%, /E A$REEE% O SELL BEAE SLLBOR%3

2. /ERE @AS A% E+RESS A$REEE% BE@EE% /E +ARES /A BORRES S/ALL BEE%LE- O /E +RO+ERY OR A%Y REOR-S +ERA%%$ /EREO OR OR$%AL O+ES OF/E -EE- OF ABSOLUE SALE O%LY U+O% FULL +AYE% OF /E +UR/ASE +RE.

. 6 6 6 #n 4ol#n! t4at -IO% acte #n (a fa#t4 an s"cceee to fr"strate t4e efforts ofBORRES to co9l) #t4 4er rec#rocal o(l#!at#on to a) t4e "rc4ase r#ce not#t4stan#n!t4e fact t4at>

1. A /E E /A BORRES @AS OBL$E- O +AY A LEAS 50 OF /E +UR/ASE +RE ORO% JU%E 15, 1'8', S/E @AS %O REA-Y, @LL%$ A%- ABLE O -O SO. EVE% ASSU%$ FOR/E SAE OF AR$UE% /A /E LAER /A- /E F%A%AL A+ABLY O EE /EROBL$AO%, /E FA REA%S /A S/E FALE- O +RO+ERLY E%-ER +AYE% OF /EROBL$AO% A%- % ASE E%-ER OF +AYE% @AS REFUSE-, O O%S$% /E SAE %OUR3

2. -IO% /A- %O REASO% O FRUSRAE /E EFFORS OF BORRES O O+LY @/ /EROBL$AO% O +AY /E A$REE- +UR/ASE +RE S%E S/E @AS ERELY O%SUE- ASUSO-A% OF /E -EE- OF ABSOLUE SALE A%- LES OF /E +RO+ERY @/ S+EF%SRUO%S O RELEASE /E SAE O BORRES O%LY U+O% REE+ OF /E +UR/ASE+RE % FULL A%- % AS/ @/% /E A$REE- +ERO-.

-. 6 6 6 #n orer#n! -#Hon to a) Borres t4e a9o"nt of +80,000.00 9oral a9a!es3 +50,000.00e6e9lar) a9a!es an +100,000.00 as attorne)Cs fees () a) of a9a!es not#t4stan#n!t4e fact t4at t4e ev#ence a"ce (efore t4e tr#al co"rt clearl)

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s4os t4at BORRES 4a no ca"se of act#on a!a#nst t4e for9er.8

@e s4all f#rst face t4e #ss"e of 4et4er t4e a!ree9ent (eteen et#t#oner SalaHar an r#vateresonent Borres #s a contract of sale or a contract to sell.

n a contract of sale, t4e t#tle to t4e roert) asses to t4e venee "on t4e el#ver) of t4et4#n! sol3 #n a contract to sell, oners4# #s, () a!ree9ent, reserve #n t4e venor an #s notto ass to t4e venee "nt#l f"ll a)9ent of t4e "rc4ase r#ce. Ot4er#se state, #n a contractof sale, t4e venor loses oners4# over t4e roert) an cannot recover #t "nt#l an "nlesst4e contract #s resolve or resc#ne3 4ereas #n a contract to sell, t#tle #s reta#ne () t4evenor "nt#l f"ll a)9ent of t4e r#ce. n t4e latter contract, a)9ent of t4e r#ce #s a os#t#ve

s"sens#ve con#t#on, fa#l"re of 4#c4 #s not a (reac4 ("t an event t4at revents t4e o(l#!at#onof t4e venor to conve) t#tle fro9 (eco9#n! effect#ve.'

f e are to cons#er onl) t4e -ee of A(sol"te Sale,10 e can eas#l) sa) t4at t4e contract(eteen SalaHar an Borres #s one of sale. /oever, t4e -ee of @arrant)11 an t4e oraltest#9on) on t4e c#rc"9stances s"rro"n#n! t4e e6ec"t#on of t4e -ee of A(sol"te Sale, asell as t4e ot4er #eces of ev#ence s"(9#tte () Borres, s"sta#n t4e f#n#n! an concl"s#on oft4e tr#al co"rt t4at t4e tr"e a!ree9ent (eteen t4e art#es as a contract to sell #n t4at t4etr"e #ntent of SalaHar as to transfer oners4# of t4e roert) to Borres onl) after t4e lattera)s t4e f"ll cons#erat#on.

Fro9 t4e (e!#nn#n! to t4e en, s"c4 #ntent#on of SalaHar as "ne"#vocal an 9an#fest. /ere?ecte BorresCs offer to a) t4e cons#erat#on #t4#n s#6 9ont4s to !#ve 4er t#9e to

::::::::::::::::::::::::::::::

8 Rollo, 1;D18.

' L"Hon Broera!e o., nc. vs. ar#t#9e B"#l#n! o., nc., ; SRA &81, &87 1'72G3 Jac#ntovs. aaraH, 20' SRA 2;, 25 1''2G3 V#sa)an Sa9#ll o., nc. vs. o"rt of Aeals, s"ranote ;, at &8'3 +#n!ol vs. o"rt of Aeals, 22; SRA 118, 12; 1''&G.

10 E64#(#ts an 1, Foler of E64#(#ts, ; an 22.

11 E64#(#t 2, ., 2.

&2;

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sec"re a loan. @4en Borres roose t4at 4e len 4er t4e cert#f#cates of t#tle of t4e lots so

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t4at s4e co"l sec"re a loan fro9 t4e (ans #n an#la an (e a(le to a), #t4#n t4ree9ont4s,12 t4e cons#erat#on o"t of t4e rocees of t4e loan, SalaHar a!ree rov#e t4at s4eo"l ass"re 4#9 t4at t4e t#tle o"l not ass to 4er "nt#l 4e #s f"ll) a#. Borres fort4#t4ro9#se to e6ec"te a arrant). S4e t4en reare a -ee of A(sol"te Sale for SalaHarCss#!nat"re an a -ee of @arrant) for 4er s#!nat"re. @4en f#nall) s4e resente to 4#9 t4e-ee of A(sol"te Sale, SalaHar # not s#!n #t an #ns#ste t4at 4e (e a# t4e "rc4ase r#ceat t4e en of J"ne 1'8'3 4e f"rt4er tol 4er t4at 4e o"l not len 4er t4e cert#f#cates of t#tle

"nt#l 4e #s so a#. /e s#!ne #t onl) after Borres a!ree to a) () t4e en of J"ne 1'8' at a(an #n aat#. B"t 4e # not !#ve t4e -ee of A(sol"te Sale to 4er3 #nstea, 4e tol 4er to ?"st 9eet 4#9 at t4e %#no) A"#no nternat#onal A#rort on 2 J"ne 1'8', 4en 4e o"l leavefor t4e Un#te States of A9er#ca, so s4e o"l no to 4o9 4e o"l entr"st t4e oc"9entan ot4er aers relat#ve to t4e roert). @e "ote ver(at#9 BorresCs on test#9on) on #recte6a9#nat#on "on t4ese o#nts>

N

/ave )o" 9et t4e oner of t4e lot 9ent#one a 4#le a!oT

A

Yes, )o"r /onor, 9et -r. SalaHar, t4e oner, so9et#9e last ee of Ar#l, 1'8' at -#9s"9Resta"rant.

N

Yo" 9et at -#9s"9, #n 4at art#c"lar lace as t4atT

A

@e 9et at -#9s"9 Resta"rant #n aat# after as calle () E9#l#o . SalaHar to 9eet at-#9s"9 (eca"se -r. SalaHar ante to sell t4e roert) an 4e ante to tal to )o" s#cG.

OUR>

al to )o"T

A

o #sc"ss t4e 9atter of sale to 9e at -#9s"9 S#r.

AY. BORRES>

N

An so )o" reall) 9et at -#9s"9.

A

Yes, aCa9.

N

@4at trans#re at -#9s"9T

::::::::::::::::::::::::::::::

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A

-r. SalaHar offere 9e to (") t4e roert#es for a total of O%E LLO% +ESOS <+1,000,000.00=e6cl"#n! all an an) ot4er e6enses t4at 9a) (e #nvolve #n t4e transfer of t4e roert#es #ncase a9 #ntereste to () s#cG, #n case Att). Borres ante to (").

N

@4at t4en as )o"r rel)T

A

a9 #ntereste to (").

N

-r. SalaHar . . . ase . . . 4at # -r. SalaHar sa) after t4atT

A

ansere -r. SalaHar t4at co"l (") or a(le to (") t4e roert#es #t4#n s#6 <;= 9ont4s(eca"se 4ave to !o 4o9e to t4e rov#nce to sec"re a loan.

N

@4at # -r. SalaHar sa) re!ar#n! )o"r roosalT

A

tol -r. SalaHar. -r. SalaHar sa# t4at 4e co"l not a#t for t4at, s#6 <;= 9ont4s #s a ver) lon!t#9e.

N

@4at else # )o" sa)T

A

tol -r. SalaHar t4at #t #s oss#(le t4at can a) #t4#n t4ree <&= 9ont4sC t#9e #f )o" can len9e t4e t#tle of )o"r roert) (eca"se (ans 4ere #n an#la "s"all) release loans #n t4ree9ont4sC t#9e an #ll 4ave less ro(le9 to co9lete t4e a)9ent of O%E LLO% +ESOS

<+1,000,000.00=.

N

So, 4at # -r. SalaHar sa)T

A

-r. SalaHar sa# t4at #f #t #s t4e (est for o"r transact#on can len )o" t4e t#tle rov#e can(e ass"re t4at t4e t#tle #ll not ass on )o" "nt#l )o" are f"ll) a#.

8/14/2019 sales (1).rtf


N

@4at as )o"r anser t4enT

A

tol -r. SalaHar t4at can e6ec"te a arrant) to t4e effelt t4at t4e roert) co"l not (e

transferre to 9e "nt#l 4ave f"ll) a# 4#9.

N

@4at # -r. SalaHar sa)T

A

-r. SalaHar sa# #ll a!ree to t4at.

OUR>

-r. SalaHar tol )o" t4at 4e #s a!reea(le to t4e roosal.

A

Yes, -r. SalaHar sa# )o" reare a raft, t4e necessar) oc"9ent an (r#n! #t to Bataan.

AY. BORRES>

N

An 4at as )o"r anser to -r. SalaHarT

A

ansere -r. SalaHar t4at #ll (e ever #ll#n! to !o to Bataan an) t#9e )o" ante 9e to.

N

An )o" reall) # !o to Bataan.

A

Yes, #.

&28

&28



6 6 6

AY. BORRES>

N

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An 4at 4aene 4#le t4ere #n BataanT

6 6 6

N

An 4at 4aene 4#le )o" !ot all seate #n t4e sala of -r. SalaHar.

A

s4oe 4#9 a oc"9ent 4#c4 4e #nstr"cte 9e to reare an 4e 4as rea #t an a!ree tot4e -ee of A(sol"te Sale an t4e arrant) 9ae. /e !ave 9e (ac t4e oc"9ents fors#!n#n!.

N

An )o" # s#!n t4e oc"9entT

A

Yes, # s#!n #t an asse #t on to -r. SalaHar.

N

After )o" asse #t to -r. SalaHar, 4at 4aeneT

A

-r. SalaHar # not s#!n t4e oc"9ent an tol 9e t4at4e #s onl) !o#n! to s#!n #t #f a9 !o#n!to a) () t4e en of J"ne an t4at 4e co"l not len 9e t4e t#tle an 4e sa# 4e #s !o#n! tos#!n #t an not to !#ve 9e a co) "nt#l t4e "rc4ase r#ce #s f"ll) a#.

N

An 4at as )o"r react#on #t4 t4e state9entT

A

sa# 4at a(o"t t4e loan t4at e 4ave a!ree at -#9s"9 #f )o" #ll not len 9e t4e t#tlean t4e oc"9ent t4at e 4ave s#!ne noT -r. SalaHar sa# co"l not len )o" t4e t#tle an care less 4o )o" are !o#n! to loan t4e roert) an ra#se t4e 9one) )o" are !o#n! to a)9e, 4at #s #9ortant to 9e #s )o" a) 9e t4e 4ole a9o"nt of One #ll#on +esos<+1,000,000.00= not later t4an J"ne &0, 1'8'.

N

An 4at # )o" sa)T

A

S#nce co"l not o an)t4#n! an reall) ante to (") t4e roert), a!ree to -r. SalaHarCscon#t#on t4at a) t4e roert) () t4e en of J"ne an #ll a) onl) at t4e (an #n aat#.

N

An 4at # -r. SalaHar sa)T

A

-r. SalaHar sa# oe) #ll s#!n t4#s an 4ave t4#s notar#He ("t co"l not len )o" an

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never 4ave a co)G of t4e t#tle as ell as t4e -ee of Sale an )o" ?"st a#t at %AA an a#t#f )o" co"l 4ave t4#s oc"9ent (eca"se a9 leav#n! on J"ne 2 for t4e US. Yo" 9eet 9et4ere.

N

An after t4at 4at # -r. SalaHar oT

A

t as onl) t4en t4at 4e s#!ne t4e oc"9ent after 4ave a!ree to 4#s roosal ("t 4e asver) 9"c4 stan

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s#cG to t4e a)9ents an 4e as no lon!er t4e sa9e 4en 9et 4#9 at -#9s"9.1&

learl) t4en, t4e or#!#nal #ntent#on #n t4e e6ec"t#on of t4e -ee of A(sol"te Sale as to#9le9ent t4e roosal of Borres t4at SalaHar len 4er t4e transfer cert#f#cates of t#tle sot4at s4e co"l sec"re a loan fro9 a (an #n an#la 4ose rocees o"l (e al#e to t4ea)9ent of t4e "rc4ase r#ce of t4e roert), an t4e or#!#nal "rose of t4e -ee of@arrant) as to ass"re SalaHar t4at, as e9ane () 4#9, t#tle to t4e lots #ll not ass to 4er"nt#l s4e a)s t4e f"ll cons#erat#on. 4e len#n! of t4e cert#f#cates of t#tle for t4e a(ove"rose co"l 4ave (een eas#l) acco9l#s4e t4ro"!4 a sec#al oer of attorne) "ner 4#c4SalaHar #ll a"t4or#He 4er to o(ta#n a loan an to 9ort!a!e t4e roert) as sec"r#t) t4erefor.B"t, er4as ant#c#at#n! SalaHarCs eart"re to t4e Un#te States of A9er#ca 4ere 4eres#es, Borres, 4o #s a la)er, reare #nstea a -ee of A(sol"te Sale an -ee of@arrant). %ot#t4stan#n! BorresCs el#(erate c4aracter#Hat#ons of t4e oc"9ents, e are

conv#nce t4at t4e) ere reare #n connect#on #t4 an #n t4e #9le9entat#on of t4ea!ree9ent re!ar#n! t4e len#n! of t4e cert#f#cates of t#tle. 4e) o not eaen t4eaa9ant#ne os#t#on of SalaHar not to art #t4 4#s t#tle to t4e to lots "nt#l f"ll a)9ent oft4e a!ree r#ce t4erefor. BorresCs e6ec"t#on of t4e -ee of @arrant) as #n fact a reco!n#t#onof SalaHarCs os#t#on. -es#te #ts caref"l or#n!s an 4raseolo!) to 9ae so9e sort of#st#nct#on (eteen BorresCs r#!4t to t4e oners4# or t#tle over t4e lots on t4e one 4an, an4er r#!4t to ossess or ee t4e -ee of A(sol"te Sale an t4e ot4er oc"9ents relat#ve to t4elots, t4e total#t) of t4e -ee of @arrant) 9an#fests an #n"(#ta(le reco!n#t#on () Borres of t4eafore9ent#one #ntent#on of SalaHar. S4e eclare t4ere#n as follos>

1. 4at "nt#l an "nless t4e a9o"nt of O%E LLO% <+1,000,000.00= +ESOS reresent#n! t4e"rc4ase r#ce for t4at arcels of lan covere () ransfer ert#f#cate of #tle %os. SD&10&8

::::::::::::::::::::::::::::::

1& S%, 5 %ove9(er 1''1, ;D1.

&&0

&&0

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an SD&10&' (e a# () t4e "ners#!ne "nto -r. E9#l#o A. SalaHar, t4e "ners#!ne 4as noa(sol"te r#!4t 4atsoever to t4e or#!#nal co#es of t4e -ee of A(sol"te Sale e6ec"te () sa#-r. E9#l#o A. SalaHar ate a) :::, 1'8'3

2. 4at s4e 4as no le!al r#!4t 4atsoever to an) an all ert#nent recors of t4eafore9ent#one lots3

&. 4at "on a)9ent of t4e afore9ent#one a9o"nt, -r. E9#l#o A. SalaHar or 4#sreresentat#ve #s o(l#!e to s"rrener t4e or#!#nal of t4ese resents to!et4er #t4 all t4eor#!#nal oc"9ents an t#tles cover#n! t4e sale of t4e afore9ent#one lots "nto t4e"ners#!ne.1

4en, too, #n 4er e9oran"9 of A!ree9ent #t4 ontelan Realt) ororat#on,15 ate 15 J"ne 1'8', Borres e6l#c#tl) 9ent#one onl) 4er r#!4ts an #nterests "ner t4e -ee ofA(sol"te Sale s#!ne () SalaHar an t4ere#n conve)e, transferre, an ass#!ne to t4e sa#cororat#on onl) s"c4 r#!4ts an #nterests. Also ort4 not#n! #s t4e state9ent #n t4e secon4ereas cla"se of t4e e9oran"9 of A!ree9ent t4at ontelan Realt) ororat#on

4as f"ll nole!e of t4e sales s#cG an con#t#ons of t4e SELLERDO@%ER of t4e roert) . . .t4at t4e (")er BorresG 4as an o(l#!at#on to a) -R. ELO SALAIAR t4e a9o"nt of O%ELLO% +ESOS <+1,000,000.00= an t4at t4ere #s alrea) a -ee of A(sol"te -ee of s#cG Sale#n favor of BorresG of 4#c4 (ot4 co#es of t4e t#tles of t4e roert#es for sale an alloc"9ents #ncl"#n! t4e -ee of A(sol"te Sale afore9ent#one are "ner t4e c"sto) of S.ERESA -IO% 4o #ll onl) release t4e #tle an t4e -ee of A(sol"te Sale after t4eo(l#!at#on of BorresG #s f"ll) a#.1;

4e #t44ol#n! () SalaHar t4ro"!4 -#Hon of t4e -ee of A(sol"te Sale, t4e cert#f#cates oft#tle, an all ot4er oc"9ents relat#ve to t4e to lots #s an a#t#onal #n"(#ta(le roof t4atSalaHar # not transfer to Borres e#t4er () act"al or constr"ct#ve el#ver) t4e oners4# oft4e to lots. @4#le !enerD

::::::::::::::::::::::::::::::

1 E64#(#t 2, Foler of E64#(#ts, 2.

15 E64#(#t $, ., 1;D17.

1; E64#(#t $, Foler of E64#(#ts, 1;.

&&1

VOL. 258, JULY 5, 1'';

&&1


all) t4e e6ec"t#on of a ee of a(sol"te sale const#t"tes constr"ct#ve el#ver) of oners4#,t4e #t44ol#n! () t4e venor of t4at ee "ner e6l#c#t a!ree9ent t4at #t (e el#vereto!et4er #t4 t4e cert#f#cates of t#tles to t4e venee onl) "on t4e latterCs f"ll a)9ent of t4econs#erat#on a9o"nts to a s"sens#on of t4e effect#v#t) of t4e ee of sale as a (#n#n!contract.

8/14/2019 sales (1).rtf


Uno"(tel), SalaHar an Borres 9"t"all) a!ree t4at es#te t4e -ee of A(sol"te Sale t#tleto t4e to lots #n "est#on as not to ass to t4e latter "nt#l f"ll a)9ent of t4e cons#erat#onof +1 9#ll#on. 4e for9 of t4e #nstr"9ent cannot reva#l over t4e tr"e #ntent of t4e art#es asesta(l#s4e () t4e ev#ence.

Accor#n!l), s#nce Borres as "na(le to a) t4e cons#erat#on, 4#c4 as a s"sens#vecon#t#on, SalaHar cannot (e co9elle to el#ver to 4er t4e ee of sale, cert#f#cates of t#tle,

an ot4er oc"9ents concern#n! t4e to lots. n ot4er ors, no r#!4t #n 4er favor an nocorreson#n! o(l#!at#on on t4e art of SalaHar ere create. Art#cle 1181 of t4e #v#l oerov#es>

n con#t#onal o(l#!at#ons, t4e ac"#s#t#on of r#!4ts, as ell as t4e e6t#n!"#s49ent or loss oft4ose alrea) ac"#re s4all een "on t4e 4aen#n! of t4e event 4#c4 const#t"tes t4econ#t#on.

Even !rant#n! for t4e sae of ar!"9ent t4at, as r"le () t4e o"rt of Aeals, t4e a!ree9entof SalaHar an Borres as ev#ence () t4e -ee of A(sol"te Sale as a erfecte contract ofsale, BorresCs act#on for sec#f#c erfor9ance 9"st l#e#se fa#l. @e are #n f"ll accor #t4 t4etr#al co"rt an, erforce, #sa!ree #t4 t4e o"rt of Aeals, t4at Borres as not rea) to a)+500,000.00 on or (efore 15 J"ne 1'8'. 4at Borres 4a a c4ec of +1.5 9#ll#on, or of 9oret4an t4e f"ll cons#erat#on of t4e to lots, #s of no 9o9ent. 4e c4ec,17 ate 15 J"ne 1'8',#s a crosse c4ec a)a(le to Att). Jonnette Borres, or 4ere#n r#vate resonent. 4e

cross#n! #s of

::::::::::::::::::::::::::::::

17 E64#(#t F, Foler of E64#(#ts, 15.

&&2

&&2



s#9le t)eto arallel l#nes at t4e "er left 4an corner #t4o"t t4e ors an co9an)(eteen t4e l#nes. Accor#n!l), #t cannot (e a# to an)one e6cet Borres, or #t can (eeos#te #t4 a (an 4ere s4e ees an acco"nt.18

4ere #s a(sol"tel) no ev#ence t4at Borres encas4e t4e c4ec an tenere to SalaHar t4r"-#Hon t4e s"9 of +500,000.00 on 15 J"ne 1'8'. On t4e contrar), t4e c4ec #tself as cancelleas s4on () t4e or cancelle 4anr#tten across #t. oreover, t4e el#ver) of t4e c4ec ()ontelan Realt) ororat#on t4ro"!4 Balao as not "ncon#t#onal. +er t4e rece#t1' Borress#!ne on 15 J"ne 1'8', encas49ent of t4e c4ec #s s"(?ect to t4e ver#f#cat#ons as to t4ea"t4ent#c#t) of oc"9ents erta#n#n! to t4e s"(?ect roert). %e#t4er #s t4ere ev#ence t4at

Borres a# t4e ona)9ent on 15 J"ne 1'8' #t4 9one) s4e !ot fro9 ot4er so"rces. %oa)9ent aears to 4ave (een 9ae t4ereafter or "r#n! t4e enenc) of t4e case (efore t4etr#al co"rt or t4e o"rt of Aeals. S4e s4o"l 4ave cons#!ne t4e a)9ent #n co"rt "rs"antto Art#cle 125; of t4e #v#l oe for 4er to (e release fro9 4er o(l#!at#on an, conse"entl),e6act f"lf#ll9ent () SalaHar of 4#s correson#n! o(l#!at#on.

4e c4allen!e ec#s#on of t4e o"rt of Aeals 9"st t4en (e reverse. 4at of t4e tr#al co"rt9"st (e aff#r9e, #t4 t4e 9o#f#cat#on cons#st#n! #n t4e elet#on of t4e aar of attorne)Csfees #n favor of t4e et#t#oners 4#c4 e f#n to (e #t4o"t (as#s. 4e aar of attorne)Cs feesas a9a!es #s t4e e6cet#on rat4er t4an t4e r"le3 #t #s not to (e !#ven to t4e efenant ever)

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t#9e t4e latter reva#ls. 4e r#!4t to l#t#!ate #s so rec#o"s t4at a enalt) s4o"l not (ec4ar!e on t4ose 4o 9a) e6erc#se #t erroneo"sl), "nless, of co"rse s"c4 art) acte #n (afa#t4.20

::::::::::::::::::::::::::::::

18 A$UE-O F. A$BAYA%, o99entar#es an J"r#sr"ence on t4e o99erc#al Las of t4e+4#l##nes, vol. 1 1'87 e.G, '.

1' E64#(#t -, Foler of E64#(#ts, 8.

20 #erra nternat#onal onstr"ct#on or. vs. %LR, 211 SRA 7&, 81 1''2G3 Al(ensonEnterr#ses or. vs. o"rt of AD

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VOL. 258, JULY 5, 1'';

&&&


@/EREFORE, t4e #nstant et#t#on #s 4ere() $RA%E-. 4e c4allen!e ec#s#on of 2' %ove9(er1'' of t4e o"rt of Aeals #n AD$.R. V %o. 01'7 #s REVERSE- an SE AS-E, an t4eec#s#on of & Sete9(er 1''2 of Branc4 ;; of t4e Re!#onal r#al o"rt of an#la #n #v#l ase%o. 8'D;8 #s AFFRE-, s"(?ect to t4e 9o#f#cat#on t4at t4e aar for attorne)Cs fees #selete.

%o rono"nce9ent as to costs.

SO OR-ERE-.

%arvasa <.J., 4a#r9an=, elo, Franc#sco an +an!an#(an, JJ., conc"r.

+et#t#on !rante, ?"!9ent reverse an set as#e. 4at of t4e co"rt a "o aff#r9e #t49o#f#cat#on.

%ote.@4en t4e sale #s not a(sol"te ("t con#t#onal t4e (reac4 of t4e con#t#on #ll reventt4e o(l#!at#on to conve) t#tle fro9 ac"#r#n! an o(l#!ator) force. <An! Y" As"nc#on vs. o"rt ofAeals, 2&8 SRA ;02 1''G= SalaHar vs. o"rt of Aeals, 258 SRA &17<1'';=G

VOL. 5&', %OVEBER 28, 2007

1'&

ast#llo vs. Re)es

$.R. %o. 170'17. %ove9(er 28, 2007.*

S+OUSES %ESOR ASLLO an ROSE REYESDASLLO, et#t#oners, vs. S+OUSES RU-Y REYESan O%SOLAO% REYES, resonents.

Sales3 Sale #s a consens"al contract an #s erfecte () 9ere consent, 4#c4 #s 9an#feste ()t4e 9eet#n! of t4e 9#ns as to t4e offer an accetance t4ereof on t4e s"(?ect 9atter, r#ce

8/14/2019 sales (1).rtf


an ter9s of a)9ent.Sale #s a consens"al contract an #s erfecte () 9ere consent, 4#c4#s 9an#feste () a 9eet#n! of t4e 9#ns as to t4e offer an accetance t4ereof on t4e s"(?ect9atter, r#ce an ter9s of a)9ent of t4e r#ce. n t4e #nstant case, t4e %ove9(er 8, 1''7A!ree9ent clearl) #n#cates t4at Bo4ler an t4e So"ses Re)es 4a a 9eet#n! of t4e 9#ns ont4e s"(?ect 9atter of t4e contract, t4e 4o"se an lot3 on t4e r#ce, +1;5,000.003 an on t4eter9s of a)9ent, an #n#t#al a)9ent of +1&0,000.00 on t4e ate of e6ec"t#on of t4ea!ree9ent an t4e re9a#n#n! (alance on or (efore -ece9(er 15, 1''7. At t4at rec#se

9o9ent 4en t4e consent of (ot4 art#es as !#ven, t4e contract of sale as erfecte.

Sa9e3 ontracts to Sell3 ontracts of Sale3 @ors an +4rases3 n a contract of sale, t4e t#tleto t4e roert) asses to t4e venee "on t4e el#ver) of t4e t4#n! sol, 4#le #n a contract tosell, oners4# #s, () a!ree9ent, reserve to t4e venor an #s not asse "nt#l f"ll a)9entof t4e "rc4ase r#ce.4e sa# a!ree9ent cannot (e cons#ere a contract to sell. n acontract of sale, t4e t#tle to t4e roert) asses to t4e venee "on t4e el#ver) of t4e t4#n!sol3 #n a contract to sell, oners4# #s, () a!ree9ent, reserve #n t4e venor an #s not toass to t4e venee "nt#l f"ll a)9ent of t4e "rc4ase r#ce. Ot4er#se state, #n a contract ofsale, t4e venor loses oners4# over t4e roert) an cannot recover #t "nt#l an "nless t4econtract #s resolve or resc#ne3 4ereas, #n a contract to sell, t#tle #s reta#ne () t4e venor"nt#l f"ll a)9ent of t4e r#ce. n t4e latter contract, a)9ent of t4e r#ce #s a os#t#ves"sens#ve con#t#on, fa#l"re of 4#c4 #s not a (reac4 ("t an event t4at revents t4e o(l#!at#onof t4e venor to conve) t#tle fro9 (eco9#n! effect#ve. 4e %ove9(er 8, 1''7 A!ree9ent4ere#n cannot (e c4aracter#He as a

:::::::::::::::

* /R- -VSO%.

1'

1'


ast#llo vs. Re)es

contract to sell (eca"se t4e seller 9ae no e6ress reservat#on of oners4# or t#tle to t4es"(?ect 4o"se an lot. nstea, t4e A!ree9ent conta#ns all t4e re"#s#tes of a contract of sale.


4e facts are state #n t4e resol"t#on of t4e o"rt.

Ra) B. Fa!"tao for et#t#oners.

Ro9eo +. nocenc#o for resonents.

R E S O L U O %

%A/URA, J.>

Before t4e o"rt #s a et#t#on for rev#e on cert#orar# "ner R"le 5 of t4e R"les of o"rtassa#l#n! t4e -ece9(er ;, 2005 -ec#s#on1 of t4e o"rt of Aeals <A= #n AD$.R. V %o.7'&85.

8/14/2019 sales (1).rtf


On %ove9(er 7, 1''7, E99al#Ha Bo4ler an resonents ne!ot#ate for t4e sale of t4efor9erCs 4o"se an lot locate at +o(lac#on, %e @as4#n!ton, Alan, to t4e latter for t4econs#erat#on of +1;5,000.00.2 On t4e follo#n! a), %ove9(er 8, t4e) s#!ne an A!ree9ent4#c4 ert#nentl) reas as follos>

@e, t4e "ners#!ne, a!ree to t4e follo#n! ter9s an con#t#ons re!ar#n! t4e sale of t4e4o"se an lot locate at +o(lac#on, %e @as4#n!ton, Alan>

1. 4at t4e total a9o"nt to (e a# s4all (e One /"nre S#6t)DF#ve 4o"san +esos<+1;5,000.00= to (e a# #n f"ll on or (efore t4e 15t4 of -ece9(er 1''73

:::::::::::::::

1 +enne () Assoc#ate J"st#ce Enr#co A. LanHanas, #t4 Assoc#ate J"st#ces ercees $oHoD-aole an +a9#o A. A(ar#ntos, conc"rr#n!3 Rollo, . 50D;.

2 ., at . 2D&.

1'5

VOL. 5&', %OVEBER 28, 2007

1'5

ast#llo vs. Re)es

2. 4at a art#al a)9ent <s#c= a total a9o"nt of One /"nre 4#rt) 4o"san +esos<+1&0,000.00= s4all (e 9ae toa), t4e 8t4 of %ove9(er 1''73

&. 4at t4e re9a#n#n! (alance #n t4e a9o"nt <s#c= of 4#rt)DF#ve 4o"san +esos <+&5,000.00=s4all (e 9ae as er X1 a(ove3

. 4at t4e (")ers, reresente () t4e So"ses R") an onsolac#on Re)es <s#c= s4all (eresons#(le for all t4e le!al an ot4er relate oc"9ents an roce"res re!ar#n! t4#s sale3

5. 4at t4e seller, reresente () s. E99al#Ha . Bo4ler, s4all vacate t4e sa# 4o"se an loton or <s#c= t4e &1st of Jan"ar), 1''83

;. 4at t4e tenants, reresente () t4e So"ses Ro9eo an E#fan#a V#cente, s4all vacate t4esa9e on or (efore t4e &0t4 of Ar#l, 1''83 an

7. 4at all art#es concerne s4all a!ree to all t4e ter9s an con#t#ons st#"late 4ere#n.&

Uon t4e s#!n#n! of t4e sa# contract, resonents 4ane to Bo4ler +20,000.00 cas4 analle!el) a +110,000.00Dc4ec. Bo4ler nonet4eless #ns#ste t4at t4e ent#re art#al a)9ents4o"l (e #n cas4 as s4e neee #t to reee9 t4e s"(?ect roert) fro9 t4e (an on t4e

follo#n! ona). S4e 4ence e9ane for #ts a)9ent " to 9#n#!4t on t4at a) ot4er#ses4e o"l cancel t4e sale. Beca"se t4e resonents fa#le to 9ae !oo t4e +110,000.00,Bo4ler s"(se"entl) sol t4e roert) to t4e et#t#oners.

/av#n! learne of t4e s"(se"ent sale, t4e resonents #99e#atel) tenere t4e c4ec,ase t4e (an for a cert#f#cat#on t4at #t as f"ne an cons"lte t4e#r la)er 4o sent anot#ce of l#s enens to t4e Re!#ster of -ees an t4e +rov#nc#al Assessor.5 #v#l ase %o. ;070for ann"l9ent of sale, sec#f#c erfor9ance an a9a!es as s"(se"entl) f#le ()

:::::::::::::::

8/14/2019 sales (1).rtf


& ., at . 5.

., at . .

5 ., at . &.

1';

1';


ast#llo vs. Re)es

t4e resonents #t4 t4e Re!#onal r#al o"rt <R= of al#(o, Alan a!a#nst Bo4ler an t4eet#t#oners.

On Fe(r"ar) 21, 200&, t4e R renere #ts -ec#s#on; eclar#n! t4e %ove9(er 8, 1''7A!ree9ent a contract to sell. ons#er#n! t4at no act"al sale 4aene (eteen Bo4ler ant4e resonents, t4e for9er co"l val#l) sell t4e roert) to t4e et#t#oners. 4"s, t4e tr#alco"rt #s9#sse t4e co9la#nt.

A!!r#eve, resonents aeale t4e case to t4e A. n t4e c4allen!e -ece9(er ;, 2005-ec#s#on,7 t4e aellate co"rt reverse t4e tr#al co"rtCs r"l#n!, eclare t4e %ove9(er 8, 1''7A!ree9ent a contract of sale, an ann"lle t4e s"(se"ent sale to t4e et#t#oners. 4e Ar"le, a9on! ot4ers, t4at t4e or#n!s of t4e a!ree9ent an t4e con"ct of t4e art#ess"!!est t4at t4e) #ntene to enter #nto a contract of sale. Oners4# as not reserve () t4evenor an nona)9ent of t4e "rc4ase r#ce as not 9ae a con#t#on for t4e contractCseffect#v#t).8

+et#t#oners, t4"s, f#le t4e #nstant et#t#on for rev#e on cert#orar# #9"t#n! t4e follo#n!errors to t4e A>

1. 4e aellate co"rt erre #n eclar#n! t4e contract st)le A$REEE% ate 08 %ove9(er1''7 as a contract of sale an not a contract to sell.

2. 4e aellate co"rt erre #n eclar#n! t4e et#t#oners #n (a fa#t4 4en t4e) (o"!4t t4es"(?ect 9atter 4o"se an lot on 02 arc4 1''8 fro9 E99al#Ha /. Bo4ler.'

4e #votal "est#on to (e aresse () t4e o"rt #n t4#s et#t#on #s 4et4er t4e transact#on(eteen Bo4ler an t4e resonents #s a erfecte contract of sale or a 9ere contract to sell.

:::::::::::::::

; ., at . 1D8.

7 S"ra note 1.

8 Rollo, . 58.

' ., at . 20.

1'7

8/14/2019 sales (1).rtf


VOL. 5&', %OVEBER 28, 2007

1'7

ast#llo vs. Re)es

Sale #s a consens"al contract an #s erfecte () 9ere consent, 4#c4 #s 9an#feste () a9eet#n! of t4e 9#ns as to t4e offer an accetance t4ereof on t4e s"(?ect 9atter, r#ce anter9s of a)9ent of t4e r#ce.10 n t4e #nstant case, t4e %ove9(er 8, 1''7 A!ree9ent clearl)#n#cates t4at Bo4ler an t4e So"ses Re)es 4a a 9eet#n! of t4e 9#ns on t4e s"(?ect 9atterof t4e contract, t4e 4o"se an lot3 on t4e r#ce, +1;5,000.003 an on t4e ter9s of a)9ent, an#n#t#al a)9ent of +1&0,000.00 on t4e ate of e6ec"t#on of t4e a!ree9ent an t4e re9a#n#n!(alance on or (efore -ece9(er 15, 1''7. At t4at rec#se 9o9ent 4en t4e consent of (ot4art#es as !#ven, t4e contract of sale as erfecte.

4e sa# a!ree9ent cannot (e cons#ere a contract to sell. n a contract of sale, t4e t#tle tot4e roert) asses to t4e venee "on t4e el#ver) of t4e t4#n! sol3 #n a contract to sell,oners4# #s, () a!ree9ent, reserve #n t4e venor an #s not to ass to t4e venee "nt#l f"lla)9ent of t4e "rc4ase r#ce. Ot4er#se state, #n a contract of sale, t4e venor loses

oners4# over t4e roert) an cannot recover #t "nt#l an "nless t4e contract #s resolve orresc#ne3 4ereas, #n a contract to sell, t#tle #s reta#ne () t4e venor "nt#l f"ll a)9ent oft4e r#ce. n t4e latter contract, a)9ent of t4e r#ce #s a os#t#ve s"sens#ve con#t#on, fa#l"reof 4#c4 #s not a (reac4 ("t an event t4at revents t4e o(l#!at#on of t4e venor to conve) t#tlefro9 (eco9#n! effect#ve.11 4e %ove9(er 8, 1''7 A!ree9ent 4ere#n cannot (e c4aracter#Heas a contract to sell (eca"se t4e seller 9ae no e6ress reservat#on of oners4# or t#tle tot4e s"(?ect 4o"se an lot.12 nstea, t4e A!ree9ent conta#ns all t4e re"#s#tes of a contract ofsale.

:::::::::::::::

10 le9eno v. Lo(re!at, $.R. %o. 1&785, Sete9(er ', 200, &8 SRA 22, &5.

11 4"a v. o"rt of Aeals, ' +4#l. 25, 1D23 01 SRA 5, ;; <200&=, c#t#n! SalaHar v.o"rt of Aeals, 258 SRA &17, &25 <1'';=.

12 See oronel v. o"rt of Aeals, &&1 +4#l. 2', &123 2;& SRA 15, 2' <1'';=.

1'8

1'8


+eole vs. Sant#a!o

@/EREFORE, re9#ses cons#ere, t4e et#t#on for rev#e on cert#orar# #s -E%E- -UEOURSE.

SO OR-ERE-.

YnaresDSant#a!o <Act!. .J., 4a#rerson=, A"str#aDart#neH, 4#coD%aHar#o an Re)es, JJ.,conc"r.

+et#t#on en#e "e co"rse.

8/14/2019 sales (1).rtf


%otes.A contract to sell #s a#n to a con#t#onal sale 4ere t4e eff#cac) or o(l#!ator) force oft4e venorCs o(l#!at#on to transfer t#tle #s s"(or#nate to t4e 4aen#n! of a f"t"re an"ncerta#n event, so t4at #f t4e s"sens#ve con#t#onal o(l#!at#on oes not tae lace, t4eart#es o"l stan as #f t4e con#t#onal o(l#!at#on 4a never e6#ste. </errera vs. a!"#at,517 SRA 57 2007G=

A contract of sale #s not a real, ("t a consens"al contract, an as s"c4 #t (eco9es val# an

(#n#n! "on t4e 9eet#n! of t4e 9#ns of t4e art#es as to t4e o(?ect an t4e r#cet4econtract #s val# even #f t4e 9anner of a)9ent #s (reac4e. <+#l##nas S4ell +etrole"9ororat#on vs. $o(onsen!, Jr., '; SRA &05 200;G= ast#llo vs. Re)es, 5&' SRA 1'&<2007=G

$.R. %o. 17';5&.J"l) &1, 200'.*

U%E- USL A%- /RSA% URBA% +OOR ASSOAO%, %. reresente () #ts+res#ent, A%UEL V. BUE%, et#t#oner, vs. BRYDV -EVELO+E% OR+ORAO% reresente() #ts +res#ent, BE%JA% NU-LLA3 an SEA FOO-S OR+ORAO%, reresente () #tsE6ec"t#ve V#ce +res#ent, VE%E . /ER%A%-EI, resonents.

Re9e#al La3 Aeals3 Fact"al f#n#n!s of t4e tr#al co"rt, esec#all) 4en aff#r9e () t4e

aellate co"rt, are accore t4e 4#!4est e!ree of resect an are cons#ere concl"s#ve(eteen t4e art#es3 E6cet#ons.@ellDentrenc4e #n ?"r#sr"ence #s t4e r"le t4at fact"alf#n#n!s of t4e tr#al co"rt, esec#all) 4en aff#r9e () t4e aellate co"rt, are accore t4e4#!4est e!ree of resect an are cons#ere concl"s#ve (eteen t4e art#es. A rev#e of s"c4f#n#n!s () t4#s o"rt #s not arrante e6cet "on a s4o#n! of 4#!4l) 9er#tor#o"sc#rc"9stances, s"c4 as> <1= 4en t4e f#n#n!s of a tr#al co"rt are !ro"ne ent#rel) onsec"lat#on, s"r9#ses or con?ect"res3 <2= 4en a loer co"rtCs #nference fro9 #ts fact"alf#n#n!s #s 9an#festl) 9#staen, a(s"r or #9oss#(le3 <&= 4en t4ere #s !rave a("se of#scret#on #n t4e arec#at#on of facts3 <= 4en t4e f#n#n!s of t4e aellate co"rt !o (e)ont4e #ss"es of t4e case, or fa#l to not#ce certa#n relevant facts 4#c4, #f roerl) cons#ere,o"l ?"st#f) a #fferent concl"s#on3 <5= 4en t4ere #s a 9#sarec#at#on of facts3 <;= 4en t4ef#n#n!s of fact are concl"s#ons #t4o"t 9ent#on of t4e sec#f#c ev#ence on 4#c4 t4e) are(ase, or are re9#se on t4e a(sence of ev#ence, or are contra#cte () ev#ence on recor.%one of t4e fore!o#n! e6cet#ons necess#tat#n! a reversal of t4e assa#le ec#s#on o(ta#n #nt4#s #nstance.

#v#l La3 ontracts3 Sales3 4e art#es #n t4e case e6ec"te a Letter of ntent, 4#c4 #s ne#t4era contract to sell nor a con#t#onal contract of sale.n t4e #nstant case, 4oever, t4e art#ese6ec"te a Letter of ntent, 4#c4 #s ne#t4er a contract to sell nor a con#t#onal contract ofsale. As fo"n () t4e R, an "4el () t4e A, t4e Letter of ntent as e6ec"te toacco99oate UU+A an fac#l#tate #ts loan al#cat#on #t4 %/F.

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* /R- -VSO%.

725

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725

Un#te "sl#9 an 4r#st#an Ur(an +oor Assoc#at#on, nc. vs. BRYDV -evelo9ent ororat#on

Sa9e3 Sa9e3 Sa9e3 4e Letter of ntent to B") an Sell #s ?"st t4ata 9an#festat#on of Sea

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Foos ororat#onCs <SF= #ntent#on to sell t4e roert) an Un#te "sl#9 an 4r#st#anUr(an +oor Assoc#at#on, nc.Cs <UU+A= #ntent#on to ac"#re t4e sa9e.%o4ere #n t4eLetter of ntent oes #t state t4at SF rel#n"#s4es #ts t#tle over t4e s"(?ect roert), s"(?ectonl) to t4e con#t#on of co9lete a)9ent of t4e "rc4ase r#ce3 nor, at t4e least, t4at SF,alt4o"!4 e6ressl) reta#n#n! oners4# t4ereof, (#ns #tself to sell t4e roert) e6cl"s#vel) toUU+A. 4e Letter of ntent to B") an Sell #s ?"st t4ata 9an#festat#on of SFCs #ntent#onto sell t4e roert) an UU+ACs #ntent#on to ac"#re t4e sa9e. 4#s #s "#te o(v#o"s fro9

t4e reference to t4e e6ec"t#on of an A(sol"te -ee of Sale #n ara!ra4 t4ree of t4e Letter ofntent.



an"el#to R. L"na for et#t#oner.

$o, ovarr"(#as, Acosta Assoc#ates La Off#ce for resonent BRYDV -evelo9entororat#on.

$onHalo B. $arc#a for resonent Sea Foos ororat#on.

%A/URA,J.>

4#s et#t#on for rev#e on cert#orar# sees to set as#e t4e -ec#s#on1 of t4e o"rt of Aeals<A= #n AD$.R. V %o. ;2557 4#c4 aff#r9e #n toto t4e -ec#s#on2 of t4e Re!#onal r#al o"rt<R=, Branc4 1;, Ia9(oan!a #t) #n #v#l ase %o. ;7<5=.

4e facts are s#9le.

:::::::::::::::

1 +enne () Assoc#ate J"st#ce Ra9on R. $arc#a #t4 Assoc#ate J"st#ces Ro9"lo V. Bora anAnton#o V#lla9or, conc"rr#n!3 Rollo, . 1&D2'.

2 +enne () J"!e Jes"s . ar(on, Jr.3 Rollo, 55D;8.

72;

72;



Resonent Sea Foos ororat#on <SF= #s t4e re!#stere oner of Lot %o. &00 locate #nLoer ala#nan, Ia9(oan!a #t) an covere () ransfer ert#f#cate of #tle <= %o. &182 <D

57;=.

So9et#9e #n 1''1, et#t#oner Un#te "sl#9 an 4r#st#an Ur(an +oor Assoc#at#on, nc.<UU+A=, an or!an#Hat#on of s"atters occ")#n! Lot %o. &00, t4ro"!4 #ts +res#ent, ar9en. -#ola, #n#t#ate ne!ot#at#ons #t4 SF for t4e "rc4ase t4ereof. UU+A e6resse #ts#ntent#on to (") t4e s"(?ect roert) "s#n! t4e rocees of #ts en#n! loan al#cat#on #t4%at#onal /o9e ort!a!e F#nance ororat#on <%/F=. 4ereafter, t4e art#es e6ec"te aLetter of ntent to Sell () SFG an Letter of ntent to +"rc4ase () UU+A, rov##n!, #nert#nent art>

@/EREAS, SFG #s t4e re!#stere oner of a arcel ofG lan es#!nate as Lot %o. &00

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s#t"ate #n Loer alar#an, Ia9(oan!a #t), cons#st#n! of ;1,7&; s"are 9eters, an 9oreart#c"larl) escr#(e #n ransfer ert#f#cate of #tle %o. 57; of t4e Re!#str) of -ees ofIa9(oan!a #t)3

@/EREAS, UU+A, an assoc#at#on "l) re!#stere #t4 t4e SE <Re!#strat#on %o. 0&10=an "l) accre#te #t4 t4e +res#ent#al o99#ss#on for t4e Ur(an +oor, 4as aroac4eSFG an ne!ot#ate for t4e ANUSO% of t4e a(oveDescr#(e roert) of SFG3

@/EREAS, #n "rs"ance to t4e ne!ot#at#ons (eteen SFG an UU+A, t4e latter 4as taenstes #t4 t4e roer !overn9ent a"t4or#t#es art#c"larl) t4e a)or of Ia9(oan!a #t) an#ts #t) /o"s#n! Boar 4#c4 #ll act as Or#!#nator #n t4e ac"#s#t#on of sa# roert) 4#c4#ll ena(le UU+A to ava#l of #ts o99"n#t) ort!a!e +ro!ra93

@/EREAS, #t aears t4at UU+A #ll "lt#9atel) al) #t4 t4e /o9e ort!a!e an F#nanceororat#on for a loan to a) t4e ac"#s#t#on r#ce of sa# lan3

@/EREAS, as one of t4e stes re"#re () t4e !overn9ent a"t4or#t#es to #n#t#ate rocee#n!s#s to rece#ve a for9al 9an#festat#on of ntent to Sell fro9 SFG3

727

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727


%O@, /EREFORE, for an #n cons#erat#on of t4e fore!o#n! re9#ses, t4e art#es 4ereto a!reeas follos>

1. SFG e6ressl) eclares #ts #ntent#on to sell Lot %o. &00 #t4 an area of ;1,7&; s"are9eters s#t"ate #n Loer alar#an, Ia9(oan!a #t) an covere () %o. 57; of t4e Re!#str)of -ees of Ia9(oan!a #t) to UU+A at t4e r#ce of +105.00 er s"are 9eter, free fro9all l#ens, c4ar!es an enc"9(rances3

2.4at UU+A 4ere() e6ressl) eclares #ts #ntent#on to (") t4e aforesa# roert) ans4all eneavor to ra#se t4e necessar) f"ns to ac"#re sa9e at t4e a(ove9ent#one r#ce of+105.00 er s"are 9eter3

&. 4at t4e A(sol"te -ee of Sale s4all (e e6ec"te, s#!ne an el#vere to!et4er #t4 t4et#tle an all ot4er ert#nent oc"9ents "on f"ll a)9ent of t4e "rc4ase r#ce3

. 4at SFG s4all a) t4e ca#tal !a#ns ta6 an oc"9entar) sta9s, Re!#strat#on, transferta6 an ot4er e6enses s4all (e a# () t4e UU+A.&

/oever, t4e #ntene sale as era#le "e to UU+ACs #na(#l#t) to sec"re t4e loan fro9%/F as not all #ts 9e9(ers occ")#n! Lot %o. &00 ere #ll#n! to ?o#n t4e "nerta#n!. ntenton (")#n! t4e s"(?ect roert), UU+A, #n a ser#es of conferences #t4 SF, roose t4es"(#v#s#on of Lot %o. &00 to allo t4e s"atterDocc"ants to "rc4ase a s9aller ort#ont4ereof.

onse"entl), so9et#9e #n -ece9(er 1'', Lot %o. &00 as s"(#v#e #nto t4ree <&= artscovere () searate t#tles>

1.Lot %o. &00DA #t4 an area of 1,;0 s"are 9eters "ner %o. D117,83

2.Lot %o. &00DB #t4 an area of 1,05 s"are 9eters "ner %o. D117,'3 an

&.Lot %o. &00D #t4 an area of 18,872 s"are 9eters "ner %o. D117,50.

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& Rollo, . 15D1;.

728

728



On Jan"ar) 11, 1''5, UU+A "rc4ase Lot %o. &00DA for +,&50,801.58. n t"rn, Lot %o.&00DB as const#t"te as roa r#!4t of a) an onate () SF to t4e local !overn9ent.

UU+A fa#le to ac"#re Lot %o. &00D for lac of f"ns. On arc4 5, 1''5, UU+Ane!ot#ate ane #t4 SF an as !#ven () t4e latter anot4er t4ree 9ont4s to "rc4ase Lot

%o. &00D. /oever, es#te t4e e6tens#on, t4e t4reeD9ont4 er#o lase #t4 t4e sale notcons"99ate (eca"se UU+A st#ll fa#le to o(ta#n a loan fro9 %/F. 4"s, on J"l) 20, 1''5,SF sol Lot %o. &00D for +2,57,585.00 to resonent BRYDV -evelo9ent ororat#on<BRY=.

A )ear later, UU+A f#le #t4 t4e R a co9la#nt a!a#nst resonents SF an BRYsee#n! to ann"l t4e sale of Lot %o. &00D, an t4e cancellat#on of %o. D121,52&. UU+Aalle!e t4at t4e sale (eteen t4e resonents v#olate #ts val# an s"(s#st#n! a!ree9ent#t4 SF e9(o#e #n t4e Letter of ntent. Accor#n! to UU+A, t4e Letter of ntent !rante#t a r#or, (etter, an referre r#!4t over BRY #n t4e "rc4ase of Lot %o. &00D.

n ref"tat#on, BRY sa# t4at UU+ACs co9la#nt # not state a ca"se of act#on s#nceUU+A 4a "ne"#vocall) reco!n#He #ts oners4# of Lot %o. &00D 4en UU+A l#e#sesent BRY a Letter of ntent ate A"!"st 18, 1''5 #9lor#n! BRY to reDsell t4e s"(?ect lot.

n a searate Anser, SF co"ntere t4at t4e Letter of ntent ate Octo(er , 1''1 #s not,an cannot (e cons#ere, a val# an s"(s#st#n! contract of sale. On t4e contrar), SFaverre t4at t4e oc"9ent as ran an e6ec"te 9erel) to acco99oate UU+A anena(le #t to co9l) #t4 t4e loan oc"9entat#on re"#re9ents of %/F. n all, SF 9a#nta#net4at t4e Letter of ntent ate Octo(er , 1''1 as s"(?ect to a con#t#on #.e., a)9ent of t4eac"#s#t#on r#ce, 4#c4 UU+A fa#le to o 4en #t # not o(ta#n t4e loan fro9 %/F.

72'

VOL. 5', JULY &1, 200'

72'


After tr#al, t4e R #s9#sse UU+ACs co9la#nt. 4e loer co"rt fo"n t4at t4e Letter ofntent as e6ec"te to fac#l#tate t4e aroval of UU+ACs loan fro9 %/F for #ts #ntene"rc4ase of Lot %o. &00. Accor#n! to t4e R, t4e Letter of ntent as s#9l) SFCseclarat#on of #ntent#on to sell, an not a ro9#se to sell, t4e s"(?ect lot. On t4e 4ole, t4eR concl"e t4at t4e Letter of ntent as ne#t4er a ro9#se, nor an ot#on contract, nor anoffer conte9late "ner Art#cle 1&1' of t4e #v#l oe, or a (#lateral contract to sell an (").

8/14/2019 sales (1).rtf


As rev#o"sl) averte to, t4e A, on aeal, aff#r9e #n toto t4e RCs r"l#n!.

/ence, t4#s reco"rse () UU+A os#t#n! a sole #ss"e for o"r resol"t#on>

S /E LEER OF %E% O SELL A%- LEER OF %E% O BUY A BLAERAL RE+ROALO%RA @/% /E EA%%$ OR O%E+LAO% OF ARLE 17', FRS +ARA$RA+/,VL O-E OF /E +/L++%EST

4e et#t#on eserves scant cons#erat#on. @e co9letel) a!ree #t4 t4e loer co"rtsC r"l#n!s.

@ellDentrenc4e #n ?"r#sr"ence #s t4e r"le t4at fact"al f#n#n!s of t4e tr#al co"rt, esec#all)4en aff#r9e () t4e aellate co"rt, are accore t4e 4#!4est e!ree of resect an arecons#ere concl"s#ve (eteen t4e art#es.5 A rev#e of s"c4 f#n#n!s () t4#s o"rt #s notarrante e6cet "on a s4o#n! of 4#!4l) 9er#tor#o"s c#rc"9stances, s"c4 as> <1= 4en t4ef#n#n!s of a tr#al co"rt are !ro"ne ent#rel) on sec"lat#on, s"r9#ses or con?ect"res3 <2=4en a loer co"rtCs #nference fro9 #ts fact"al f#n#n!s #s 9an#festl) 9#staen, a(s"r or#9oss#(le3 <&= 4en t4ere #s !rave a("se of #screD

:::::::::::::::

., at . .

5 #tan onstr"ct#on ororat#on v. Un#DF#el Enterr#ses, nc., $.R. %o. 15&87, arc4 7, 2007,517 SRA 1803 S#!a)a v. a)"!a, $.R. %o. 1&25, A"!"st 18, 2005, ;7 SRA &1.

7&0

7&0



t#on #n t4e arec#at#on of facts3 <= 4en t4e f#n#n!s of t4e aellate co"rt !o (e)on t4e#ss"es of t4e case, or fa#l to not#ce certa#n relevant facts 4#c4, #f roerl) cons#ere, o"l ?"st#f) a #fferent concl"s#on3 <5= 4en t4ere #s a 9#sarec#at#on of facts3 <;= 4en t4ef#n#n!s of fact are concl"s#ons #t4o"t 9ent#on of t4e sec#f#c ev#ence on 4#c4 t4e) are(ase, or are re9#se on t4e a(sence of ev#ence, or are contra#cte () ev#ence onrecor.; %one of t4e fore!o#n! e6cet#ons necess#tat#n! a reversal of t4e assa#le ec#s#ono(ta#n #n t4#s #nstance.

UU+A #s aa9ant, 4oever, t4at t4e A erre 4en #t al#e t4e secon ara!ra4 ofArt#cle 17' of t4e #v#l oe #nstea of t4e f#rst ara!ra4 t4ereof. UU+A "r!es "s t4att4e f#rst ara!ra4 of Art#cle 17' conte9lates a (#lateral rec#rocal contract 4#c4 #s(#n#n! on t4e art#es. Yet, UU+A #s caref"l not to es#!nate t4e Letter of ntent as aontract to Sell. UU+A s#9l) #ns#sts t4at t4e Letter of ntent #s not a "n#lateral ro9#se to

sell or (") 4#c4 4as to (e s"orte () a cons#erat#on #st#nct fro9 t4e r#ce for #t to (e(#n#n! on t4e ro9#ssor. n s4ort, UU+A cla#9s t4at t4e Letter of ntent # not 9erel)!rant t4e art#es t4e ot#on to resect#vel) sell or (") t4e s"(?ect roert). Alt4o"!4 notstate la#nl), UU+A cla#9s t4at t4e Letter of ntent #s e"#valent to a con#t#onal contractof sale s"(?ect onl) to t4e s"sens#ve con#t#on of a)9ent of t4e "rc4ase r#ce.

UU+A aears to la(or "ner a clo" of conf"s#on. 4e f#rst ara!ra4 of Art#cle 17'conte9lates t4e (#lateral relat#ons4# of a contract to sell as #st#n!"#s4e fro9 a contract ofsale 4#c4 9a) (e a(sol"te or con#t#onal "ner Art#cle 1587 of t4e sa9e coe. t reas>

:::::::::::::::

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; laoDN"#ana) v. a#le, $.R. %o. 15087, Octo(er 25, 2005, 7 SRA 2;, 27. See 4#lLearn#n! enter, nc. v. a!or#o, $.R. %o. 150'20, %ove9(er 25, 2005, 7; SRA 2&;, 2&;D2&7.

7 Art. 158.B) t4e contract of sale one of t4e contract#n! art#es o(l#!ates 4#9self to transfert4e oners4# of an to el#ver a

7&1

VOL. 5', JULY &1, 200'

7&1


Art.17'.A ro9#se to (") an sell a eter9#nate t4#n! for a r#ce certa#n #s rec#rocall)e9ana(le.

An accete "n#lateral ro9#se to (") or to sell a eter9#nate t4#n! for a r#ce certa#n #s(#n#n! "on t4e ro9#ssor #f t4e ro9#se #s s"orte () a cons#erat#on #st#nct fro9 t4er#ce.

4e case of oronel v. o"rt of Aeals8 #s #ll"9#nat#n! an e6la#ns t4e #st#nct#on (eteen acon#t#onal contract of sale "ner Art#cle 158 of t4e #v#l oe an a (#lateral contract to sell"ner Art#cle 17' of t4e sa9e coe>


A contract to sell as ef#ne 4ere#na(ove, 9a) not even (e cons#ere as a con#t#onalcontract of sale 4ere t4e seller 9a) l#e#se reserve t#tle to t4e roert) s"(?ect of t4e sale"nt#l t4e f"lf#ll9ent of a s"sens#ve con#t#on, (eca"se #n a con#t#onal contract of sale, t4ef#rst ele9ent of consent #s resent, alt4o"!4 #t #s con#t#one "on t4e 4aen#n! of acont#n!ent event 4#c4 9a) or 9a) not occ"r. f t4e s"sens#ve con#t#on #s not f"lf#lle, t4eerfect#on of t4e contract of sale #s co9letel) a(ate. /oever, #f t4e s"sens#ve con#t#on #sf"lf#lle, t4e contract of sale #s t4ere() erfecte, s"c4 t4at #f t4ere 4a alrea) (een rev#o"sel#ver) of t4e roert) s"(?ect of t4e sale to t4e (")er, oners4# t4ereto a"to9at#call)transfers to t4e (")er () oerat#on of la #t4o"t an) f"rt4er act 4av#n! to (e erfor9e ()t4e seller.

n a contract to sell, "on t4e f"lf#ll9ent of t4e s"sens#ve con#t#on 4#c4 #s t4e f"ll a)9entof t4e "rc4ase r#ce, oners4# #ll not a"to9at#call) transfer to t4e (")er alt4o"!4 t4eroert)

:::::::::::::::

eter9#nate t4#n!, an t4e ot4er to a) t4erefor a r#ce certa#n #n 9one) or #ts e"#valent.


8 $.R. %o. 10&577, Octo(er 7, 1'';, &&1 +4#l. 2'3 2;& SRA 15.

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7&2

7&2



9a) 4ave (een rev#o"sl) el#vere to 4#9. 4e rosect#ve seller st#ll 4as to conve) t#tle tot4e rosect#ve (")er () enter#n! #nto a contract of a(sol"te sale.

t #s essent#al to #st#n!"#s4 (eteen a contract to sell an a con#t#onal contract of salesec#all) #n cases 4ere t4e s"(?ect roert) #s sol () t4e oner not to t4e art) t4e sellercontracte #t4, ("t to a t4#r erson, as #n t4e case at (enc4. n a contract to sell, t4ere(e#n! no rev#o"s sale of t4e roert), a t4#r erson (")#n! s"c4 roert) es#te t4ef"lf#ll9ent of t4e s"sens#ve con#t#on s"c4 as t4e f"ll a)9ent of t4e "rc4ase r#ce, for#nstance, cannot (e ee9e a (")er #n (a fa#t4 an t4e rosect#ve (")er cannot see t4erel#ef of reconve)ance of t4e roert). 4ere #s no o"(le sale #n s"c4 case. #tle to t4eroert) #ll transfer to t4e (")er after re!#strat#on (eca"se t4ere #s no efect #n t4e onerD

sellerCs t#tle er se, ("t t4e latter, of co"rse, 9a) (e s"e for a9a!es () t4e #nten#n! (")er.

n a con#t#onal contract of sale, 4oever, "on t4e f"lf#ll9ent of t4e s"sens#ve con#t#on, t4esale (eco9es a(sol"te an t4#s #ll ef#n#tel) affect t4e sellerCs t#tle t4ereto. n fact, #f t4ere4a (een rev#o"s el#ver) of t4e s"(?ect roert), t4e sellerCs oners4# or t#tle to t4eroert) #s a"to9at#call) transferre to t4e (")er s"c4 t4at, t4e seller #ll no lon!er 4ave an)t#tle to transfer to an) t4#r erson. Al)#n! Art#cle 15 of t4e #v#l oe, s"c4 secon (")erof t4e roert) 4o 9a) 4ave 4a act"al or constr"ct#ve nole!e of s"c4 efect #n t4esellerCs t#tle, or at least as c4ar!e #t4 t4e o(l#!at#on to #scover s"c4 efect, cannot (e are!#strant #n !oo fa#t4. S"c4 secon (")er cannot efeat t4e f#rst (")erCs t#tle. n case a t#tle#s #ss"e to t4e secon (")er, t4e f#rst (")er 9a) see reconve)ance of t4e roert) s"(?ect oft4e sale.

n t4e #nstant case, 4oever, t4e art#es e6ec"te a Letter of ntent, 4#c4 #s ne#t4er acontract to sell nor a con#t#onal contract of sale. As fo"n () t4e R, an "4el () t4e A,

t4e Letter of ntent as e6ec"te to acco99oate UU+A an fac#l#tate #ts loan al#cat#on#t4 %/F. 4e t4 an 5t4 ara!ra4s of t4e rec#tals <4ereas cla"ses= sec#f#call) rov#e>

7&&

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7&&


@/EREAS, #t aears t4at UU+A #ll "lt#9atel) al) #t4 t4e /o9e ort!a!e an

F#nance ororat#on for a loan to a) t4e ac"#s#t#on r#ce of sa# lan3

@/EREAS, as one of t4e stes re"#re () t4e !overn9ent a"t4or#t#es to #n#t#ate rocee#n!s#s to rece#ve a for9al 9an#festat#on of ntent to Sell fro9 SFG.

%o4ere #n t4e Letter of ntent oes #t state t4at SF rel#n"#s4es #ts t#tle over t4e s"(?ectroert), s"(?ect onl) to t4e con#t#on of co9lete a)9ent of t4e "rc4ase r#ce3 nor, at t4eleast, t4at SF, alt4o"!4 e6ressl) reta#n#n! oners4# t4ereof, (#ns #tself to sell t4eroert) e6cl"s#vel) to UU+A. 4e Letter of ntent to B") an Sell #s ?"st t4ata9an#festat#on of SFCs #ntent#on to sell t4e roert) an UU+ACs #ntent#on to ac"#re t4e

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sa9e. 4#s #s "#te o(v#o"s fro9 t4e reference to t4e e6ec"t#on of an A(sol"te -ee of Sale #nara!ra4 t4ree' of t4e Letter of ntent.

As t4e A #, e "ote #t4 favor t4e RCs #s"#s#t#on>

4e -ec#s#on #n t4#s case 4#n!es on t4e le!al #nterretat#on of t4e A!ree9ent entere #nto ()SF an UU+A eno9#nate as Letter of ntent to Sell () Lanoner an Letter of ntent

to +"rc4ase () Un#te "sl#9 an 4r#st#an Ur(an +oor Assoc#at#on, nc.

BlacCs La -#ct#onar) sa)s t4at a Letter of ntent #s c"sto9ar#l) e9lo)e to re"ce tor#t#n! a rel#9#nar) "nerstan#n! of art#es 4o #nten to enter #nto contract. t #s a 4raseor#nar#l) "se to enote a (r#ef 9e9oran"9 of t4e rel#9#nar) "nerstan#n! of art#es4o #nten to enter #nto a contract. t #s a r#tten state9ent e6ress#n! t4e #ntent#on of t4eart#es to enter #nto a for9al a!ree9ent esec#all) a ("s#ness arran!e9ent or transact#on.

n t4e#r A!ree9ent, SF e6ressl) eclare #ts #ntent#on to sell an UU+A e6ressl)eclare #ts #ntent#on to (") s"(?ect roert). An #ntent#on #s a 9ere #ea, !oal, or lan. ts#9l) s#!n#f#es a co"rse of act#on t4at one rooses to follo. t s#9l) #n#cates

:::::::::::::::

' &. 4at t4e A(sol"te -ee of Sale s4all (e e6ec"te, s#!ne an el#vere to!et4er #t4 t4et#tle an all ot4er ert#nent oc"9ents "on f"ll a)9ent of t4e "rc4ase r#ce.

7&

7&



4at one rooses to o or acco9l#s4. A 9ere #ntent#on cannot !#ve r#se to an o(l#!at#on to!#ve, to o or not to o <Art#cle 115;, #v#l oe=. One cannot (e (o"n () 4at 4e rooses orlans to o or acco9l#s4. A Letter of ntent #s not a contract (eteen t4e art#es t4ereto(eca"se #t oes not (#n one art), #t4 resect to t4e ot4er, to !#ve so9et4#n!, or to renerso9e serv#ce <Art. 1&05, #v#l oe=.

6 6 66 6 66 6 6

4e Letter of ntentWA!ree9ent (eteen SF an UU+A #s 9erel) a r#tten rel#9#nar)"nerstan#n! of t4e art#es 4ere#n t4e) eclare t4e#r #ntent#on to enter #nto a contract ofsale. t #s s"(?ect to t4e con#t#on t4at UU+A #ll al) #t4 t4e /o9e ort!a!e anF#nance ororat#on for a loan to a) t4e ac"#s#t#on r#ce of sa# lan. One of t4ere"#re9ents for s"c4 loan #s a for9al 9an#festat#on of ntent to Sell fro9 SF. 4"s, t4eLetter of ntent to Sell fell s4ort of an offer conte9late #n Art#cle 1&1' of t4e #v#l oe

(eca"se #t #s not a certa#n an ef#n#te roosal to 9ae a contract ("t 9erel) a eclarat#on ofSFCs #ntent#on to enter #nto a contract. UU+ACs eclarat#on of #ntent#on to (") #s also notcerta#n an ef#n#te as #t #s s"(?ect to t4e con#t#on t4at UU+A s4all eneavor to ra#sef"ns to ac"#re s"(?ect lan. 4e accetance of t4e offer 9"st (e a(sol"te3 #t 9"st (e la#nan "ncon#t#onal. oreover, t4e Letter of ntentWA!ree9ent oes not conta#n a ro9#se orco99#t9ent to enter #nto a contract of sale as #t 9erel) eclare t4e #ntent#on of t4e art#esto enter #nto a contract of sale "on f"lf#ll9ent of a con#t#on t4at UU+A co"l sec"re aloan to a) for t4e r#ce of a lan.

4e Letter of ntentWA!ree9ent #s not an ot#on contract (eca"se as#e fro9 t4e fact t4at #t

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#s 9erel) a eclarat#on of #ntent#on to sell an to (") s"(?ect to t4e con#t#on t4at UU+As4all ra#se t4e necessar) f"ns to a) t4e r#ce of t4e lan, an oes not conta#n a (#n#n!ro9#se to sell an ("), #t #s not s"orte () a #st#nct cons#erat#on #st#nct fro9 t4e r#ceof t4e lan #ntene to (e sol an to (e (o"!4t 6 6 6 %o ot#on as !rante to UU+A"ner t4e Letter of ntentWA!ree9ent to (") s"(?ect lan to t4e e6cl"s#on of all ot4ers #t4#n af#6e er#o nor as SF (o"n "ner sa# A!ree9ent to Sell e6cl"s#vel) to UU+A onl) t4esa# lan #t4#n t4e f#6e er#o.

%e#t4er can t4e Letter of ntentWA!ree9ent (e cons#ere a (#lateral rec#rocal contract to sellan to (") conte9late "ner

7&5

VOL. 5', JULY &1, 200'

7&5


Art#cle 17' of t4e #v#l oe 4#c4 #s rec#rocall) e9ana(le. 4e Letter ofntentWA!ree9ent oes not conta#n a +ROSE to sell an to (") s"(?ect roert). 4ere asno ro9#se or co99#t9ent on t4e art of SF to sell s"(?ect lan to UU+A, ("t 9erel) aeclarat#on of #ts #ntent#on to (") t4e lan, s"(?ect to t4e con#t#on t4at UU+A co"l ra#set4e necessar) f"ns to ac"#re t4e sa9e at t4e r#ce of +105.00 er s"are 9eter 6 6 6

@4#le UU+A s"cceee #n ra#s#n! f"ns to ac"#re a ort#on of Lot %o. &00DA, #t fa#le tora#se f"ns to a) for Lot %o. &00D. Fro9 Octo(er , 1''1 4en t4e Letter of ntent ass#!ne to J"ne, 1''5, UU+A 4a a(o"t t4ree <&= )ears an e#!4t <8= 9ont4s #t4#n 4#c4 to"rs"e #ts #ntent#on to (") s"(?ect lan fro9 SF. @#t4#n t4at er#o, UU+A 4a a9le t#9e#t4#n 4#c4 to ac"#re Lot %o. &00D, as #n fact #t 4a ac"#re Lot %o. &00DA 4#c4 #s 9"c4(#!!er t4an Lot %o. &00D an occ"#e () 9ore 9e9(ers of UU+A. 4e fa#l"re of UU+Ato ac"#re Lot %o. &00D (efore #t as sol to BRYDV cannot (e (la9e on SF (eca"se allt4at UU+A 4a to o as to ra#se f"ns to a) for Lot %o. &00D 4#c4 #t # #t4 resect toLot %o. &00DA. SF 4a not4#n! to o #t4 SFCs "n#lateral act#on t4ro"!4 rs. Anton#na

$rac#ano to ostone t4e rocess#n! of t4e ac"#s#t#on of Lot %o. &00D, 4#c4 #t referre toas +4ase , "nt#l after t4e a)9ent to SF of t4e ac"#s#t#on r#ce for Lot %o. &00DA or +4ase 6 6 6.

@/EREFORE, re9#ses cons#ere, t4e et#t#on #s 4ere() -E%E-. 4e -ec#s#on of t4e o"rt ofAeals #n AD$.R. V %o. ;2557 an t4e Re!#onal r#al o"rt #n #v#l ase %o. ;7<5= areAFFRE-. osts a!a#nst t4e et#t#oner.

SO OR-ERE-.

YnaresDSant#a!o <4a#rerson=, 4#coD%aHar#o, Velasco, Jr. an +eralta, JJ., conc"r.

+et#t#on en#e, ?"!9ent aff#r9e.

%ote.As a !eneral r"le, 4en t4e f#n#n!s of (ot4 co"rts are #n a!ree9ent, t4#s o"rt #ll notreverse t4e#r f#n#n!s of fact. <$onHales, Jr. vs. +eole, 515 SRA 80 2007G= Un#te "sl#9an 4r#st#an Ur(an +oor Assoc#at#on, nc. vs. BRYDV -evelo9ent ororat#on, 5' SRA72<200'=G

&.con#t#onal contract of sale

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VOL. 1&&, -EEBER 2;, 1'8

777

+eoleCs /o9es#te /o"s#n! or. vs. o"rt of Aeals

%o. LD;1;2&. -ece9(er 2;, 1'8.*

+EO+LECS /OESE /OUS%$ OR+ORAO%, et#t#onerDaellant, vs. OUR OF A++EALS,RIAL%O L. E%-OIA an A-ELA-A R. E%-OIA, resonentsDaellees.

Sale3 +././..3 4ere #s no erfecte sale of a s"(#v#s#on lot 4ere aar t4ereof ase6ressl) 9ae s"(?ect to aroval () 4#!4er a"t4or#t#es an t4ere as no accetance9an#feste () t4e s"ose aaree.@e 4ol t4at t4ere as no erfecte sale of Lot . tas con#t#onall) or cont#n!entl) aare to t4e enoHas s"(?ect to t4e aroval () t4e c#t)co"nc#l of t4e roose consol#at#on s"(#v#s#on lan an t4e aroval of t4e aar () t4eval"at#on co99#ttee an 4#!4er a"t4or#t#es.

Sa9e3 Sa9e3 Sa9e.4e c#t) co"nc#l # not arove t4e s"(#v#s#on lan. 4e enoHasere av#se #n 1';1 of t4e #saroval. n 1';, 4en t4e lan #t4 t4e area of Lot re"ceto 2,;08.7 s"are 9eters as arove, t4e enoHas s4o"l 4ave 9an#feste #n r#t#n! t4e#raccetance of t4e aar for t4e "rc4ase of Lot ?"st to s4o t4at t4e) ere st#ll #ntereste

#n #ts "rc4ase alt4o"!4 t4e area as re"ce an to o(v#ate an) o"(t on t4e 9atter. 4e)# not o so. 4e +// (oar of #rectors acte #t4#n #ts r#!4ts #n #t4ra#n! t4e tentat#veaar.

A++EAL fro9 t4e ec#s#on of t4e o"rt of Aeals.


an"el . LaHaro, +#l##nas Arenas La(orte an Anton#o . Br#llantes for et#t#oner +//.

olent#no, r"H, Re)es, Lava an an"el for r#vate resonents.

ANU%O, J.>

4e "est#on #n t4#s case #s 4et4er t4e +eoleCs /o9es#te /o"s#n! ororat#on (o"n #tselfto sell to t4e enoHa so"ses Lot <Roa= +csD5; of t4e rev#se consol#at#on

:::::::::::::::

* SEO%- -VSO%.

778

778



s"(#v#s#on lan #t4 an area of 2,;08.7 <2,50&.7= s"are 9eters locate at -#l#9an, N"eHon

8/14/2019 sales (1).rtf


#t).

4e +// (oar of #rectors on Fe(r"ar) 18, 1';0 asse Resol"t#on %o. 51& 4ere#n #t statet4at s"(?ect to t4e aroval of t4e N"eHon #t) o"nc#l of t4e a(oveD9ent#one onsol#at#onS"(#v#s#on +lan, Lot , conta#n#n! ,182.2 s"are 9eters (e, as #t #s 4ere() aare toSo"ses R#Hal#no enoHa an Aela#a enoHa, at a r#ce of tent)Done esos <+21.00= ers"are 9eter an t4at t4#s aar s4all (e s"(?ect to t4e aroval of t4e OE <+//=

Val"at#on o99#ttee an 4#!4er a"t4or#t#es.

4e c#t) co"nc#l #sarove t4e roose consol#at#on s"(#v#s#on lan on A"!"st 20, 1';1<E64. 2=. 4e sa# so"ses ere av#se () re!#stere 9a#l of t4e #saroval of t4e lan <E64.2D+//=. Anot4er s"(#v#s#on lan as reare an s"(9#tte to t4e c#t) co"nc#l foraroval. 4e rev#se lan, 4#c4 #ncl"e Lot , #t4 a re"ce area of 2,;08.7, asarove () t4e c#t) co"nc#l on Fe(r"ar) 25, 1'; <E64. /=.

On Ar#l 2;, 1';5 t4e +// (oar of #rectors asse a resol"t#on recall#n! all aars of lotsto ersons 4o fa#le to a) t4e eos#t or on a)9ent for t4e lots aare to t4e9 <E64.5=. 4e enoHas never a# t4e r#ce of t4e lot nor 9ae t4e 20 #n#t#al eos#t.

On Octo(er 18, 1';5 t4e +// (oar of #rectors asse Resol"t#on %o. 218, #t4ra#n! t4etentat#ve aar of Lot to t4e enoHa so"ses "ner Resol"t#on %o. 51& an reaar#n!sa# lot ?o#ntl) an #n e"al s4ares to #!"ela Sto. -o9#n!o, Enr#"e Este(an, V#r!#l#o +#nHon,

Leonaro Re"(lo an Jose FernaneH, s"(?ect to e6#st#n! +// r"les an re!"lat#ons. 4er#ces o"l (e t4e sa9e as t4ose of t4e a?o#n#n! lots. 4e aarees ere re"#re toeos#t an a9o"nt e"#valent to 20 of t4e total sell#n! r#ce <E64. F=.

4e f#ve aarees 9ae t4e #n#t#al eos#t. 4e correson#n! ees of sale ere e6ec"te #nt4e#r favor. 4e s"(#v#s#on of Lot #nto f#ve lots as arove () t4e c#t) co"nc#l an t4eB"rea" of Lans.

On arc4 1;, 1';; t4e enoHa so"ses ase for recons#erat#on of t4e #t4raal of t4erev#o"s aar to t4e9 of

77'

VOL. 1&&, -EEBER 2;, 1'8

77'


Lot an for t4e cancellat#on of t4e reDaar of sa# lot to Sto. -o9#n!o an fo"r ot4ers.Before t4e re"est co"l (e acte "on, t4e so"ses f#le t4e #nstant act#on for sec#f#cerfor9ance an a9a!es.

4e tr#al co"rt s"sta#ne t4e #t4raal of t4e aar. 4e enoHas aeale. 4e Aellateo"rt reverse t4at ec#s#on an eclare vo# t4e reDaar of Lot an t4e ees of sale an#recte t4e +// to sell to t4e enoHas Lot #t4 an area of 2,;0&.7 s"are 9eters at +21a s"are 9eter an a) to t4e9 +,000 as attorne)Cs fees an l#t#!at#on e6enses. 4e +//aeale to t4#s o"rt.

4e #ss"e #s 4et4er t4ere as a erfecte sale of Lot , #t4 t4e re"ce area, to t4eenoHas 4#c4 t4e) can enforce a!a#nst t4e +// () an act#on for sec#f#c erfor9ance.

@e 4ol t4at t4ere as no erfecte sale of Lot . t as con#t#onall) or cont#n!entl) aareto t4e enoHas s"(?ect to t4e aroval () t4e c#t) co"nc#l of t4e roose consol#at#ons"(#v#s#on lan an t4e aroval of t4e aar () t4e val"at#on co99#ttee an 4#!4era"t4or#t#es.

8/14/2019 sales (1).rtf


4e c#t) co"nc#l # not arove t4e s"(#v#s#on lan. 4e enoHas ere av#se #n 1';1 oft4e #saroval. n 1';, 4en t4e lan #t4 t4e area of Lot re"ce to 2,;08.7 s"are9eters as arove, t4e enoHas s4o"l 4ave 9an#feste #n r#t#n! t4e#r accetance of t4eaar for t4e "rc4ase of Lot ?"st to s4o t4at t4e) ere st#ll #ntereste #n #ts "rc4asealt4o"!4 t4e area as re"ce an to o(v#ate an) o"(t on t4e 9atter. 4e) # not o so.4e +// (oar of #rectors acte #t4#n #ts r#!4ts #n #t4ra#n! t4e tentat#ve aar.

4e contract of sale #s erfecte at t4e 9o9ent t4ere #s a 9eet#n! of 9#ns "on t4e t4#n!4#c4 #s t4e o(?ect of t4e contract an "on t4e r#ce. Fro9 t4at 9o9ent, t4e art#es 9a)rec#rocall) e9an erfor9ance, s"(?ect to t4e la !overn#n! t4e for9 of contracts. <Art.175, #v#l oe=.

Son, s#n e9(ar!o, e6cet#on a esta re!la los casos en "e or v#rt" e la vol"nta e lasartes o e la le), se cele(ra la venta (a?o "na con#c#n s"sens#va, ) en los c"ales no seerfecc#ona la venta 4asta el c"9l#9#ento e la con#c#n < astan o(eKas, -erec4o #v#lEsaKol 8t4 e. . 81=.

780

780



n con#t#onal o(l#!at#ons, t4e ac"#s#t#on of r#!4ts, as ell as t4e e6t#n!"#s49ent or loss oft4ose alrea) ac"#re, s4all een "on t4e 4aen#n! of t4e event 4#c4 const#t"tes t4econ#t#on. <Art. 1181, #v#l oe=. Se lla9a s"sens#ve la con#c#n e la "e eene laerfecc#on, o sea el r#nc##o el contrato. <' $#or!#, eor#a e las O(l#!ac#ones, . 57=.

Uner t4e facts of t4#s case, e cannot sa) t4ere as a 9eet#n! of 9#ns on t4e "rc4ase ofLot #t4 an area of 2,;08.7 s"are 9eters at +21 a s"are 9eter.

4e case of La#n#! vs. o"rt of Aeals, 115 SRA 21& #s not #n o#nt (eca"se t4e aaree #n

t4at case al#e for t4e "rc4ase of t4e lot, a# t4e 10 eos#t an a con#t#onal contractto sell as e6ec"te #n 4#s favor. 4e +// co"l not reaar t4at lot to anot4er erson.

@/EREFORE, t4e ec#s#on of t4e Aellate o"rt #s reverse an set as#e an t4e ?"!9ent oft4e tr#al co"rt #s aff#r9e. %o costs.

SO OR-ERE-.

aas#ar, <4a#r9an=, oncec#on, Jr., A(a Santos, Escol#n an "evas, JJ., conc"r.

-ec#s#on reverse an set as#e.

%otes.4ere #s no erfecte contract 4ere t4e alle!e contract as s#!ne () onl) oneart) an t4e recor s4os t4at t4e ot4er art) # not e6ec"te or s#!n t4e sa# contract for9.<$"ar#ano vs. Encarnac#on, 2' SRA &2;.=

A contract of sale #s erfecte t4e 9o9ent t4ere #s a!ree9ent "on t4e t4#n! o(?ect of t4econtract an "on t4e r#ce. <+4#l##ne V#r!#n#a o(acco A9#n#strat#on vs. -e los An!eles, 87SRA 1'7.=

Oners4# #s not transferre () erfect#on of t4e contract ("t () el#ver), e#t4er act"al orconstr"ct#ve. <Sa9a!"#ta +#ct"res, nc. vs. Jal#nor an"fact"rer, nc., '& SRA 20.=+eoleCs /o9es#te /o"s#n! or. vs. o"rt of Aeals, 1&& SRA 777<1'8=G

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118


+#n!ol vs. o"rt of Aeals

$. R. %o. 102'0'. Sete9(er ;, 1''&.*

S+OUSES VE%E an LOUR-ES +%$OL, et#t#oners, vs. /O%. OUR OF A++EALS an /ERSOF FRA%SO %. -O%ASO, na9el)> EL%-A -. +ELAYO, AREA -. S%$SO%, YR%A -.UEVAS, %AV-A- -. +ELAYO, YOLA%-A -. AERES an ARY -O%ASO, resonents.

#v#l La3 ontracts3 Sale3 -#st#nct#on (eteen contract of sale an a contract to sell.4e#st#nct#on (eteen t4e to #s #9ortant for #n a contract of sale, t4e t#tle asses to t4evenee "on t4e el#ver) of t4e t4#n! sol, 4ereas #n a contract to sell, () a!ree9ent,oners4# #s reserve #n t4e venor an #s not to ass "nt#l t4e f"ll a)9ent of t4e r#ce. n acontract of sale, t4e venor 4as lost an cannot recover oners4# "nt#l an "nless t4econtract #s resolve or resc#ne, 4ereas #n a contract to sell, t#tle #s reta#ne () t4e venor"nt#l t4e f"ll a)9ent of t4e r#ce, s"c4 a)9ent (e#n! a os#t#ve s"sens#ve con#t#on, fa#l"reof 4#c4 #s not a (reac4 ("t an event t4at revente t4e o(l#!at#on of t4e venor to conve)t#tle fro9 (eco9#n! effect#ve.

Sa9e3 Sa9e3 Sa9e3 Sa9e3 A er"sal of E64#(#t A leas to no ot4er concl"s#on t4an t4at #te9(o#es a contract of sale.A er"sal of E64#(#t A leas to no ot4er concl"s#on t4an t4at #te9(o#es a contract of sale. 4e la#n an clear tenor of t4e -EE- OF ABSOLUE SALE OFO%ED/ALF <1W2= OFG A% U%-V-E- +ORO% OF A +AREL OF LA%- #s t4at t4e VE%-OR4ere() 6 6 6 SELL, O%VEY A%- O%VEY () a) of A(sol"te Sale t4e oneD4alf <1W2= ort#on 6 66 to t4e VE%-EE 6 6 6 4#s 4e#rs, ass#!ns an s"ccessorsD#nD#nterest. 4at t4e venor,et#t#oner V#cente +#n!ol, 4a t4at clear #ntent#on as f"rt4er ev#ence () 4#s fa#l"re toreserve 4#s t#tle t4ereto "nt#l t4e f"ll a)9ent of t4e r#ce.

Sa9e3 Sa9e3 Sa9e3 Sa9e3 A ee of sale #s a(sol"te #n nat"re alt4o"!4 eno9#nate as a-ee of on#t#onal Sale 4ere t4ere #s no st#"lat#on #n t4e ee t4at t#tle to t4e roert)sol #s reserve #n t4e seller "nt#l t4e f"ll a)9ent of t4e r#ce nor #s t4ere a st#"lat#on !#v#n!t4e venor t4e r#!4t to "n#laterall) resolve t4e contract t4e 9o9ent t4e (")er fa#ls to a)#t4#n a f#6e er#o.n -#!nos vs. o"rt of Aeals, e 4el t4at a ee of sale #s a(sol"te

#n nat"re alt4o"!4 eno9#nate as a -ee of on#t#onal Sale 4ere t4ere #s no st#"lat#on#n t4e ee

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* FRS -VSO%.

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t4at t#tle to t4e roert) sol #s reserve #n t4e seller "nt#l t4e f"ll a)9ent of t4e r#ce, nor #st4ere a st#"lat#on !#v#n! t4e venor t4e r#!4t to "n#laterall) resolve t4e contract t4e 9o9entt4e (")er fa#ls to a) #t4#n a f#6e er#o. E64#(#t A conta#ns ne#t4er st#"lat#on. @4at #s9erel) state t4ere#n #s t4at t4e VE%-EE a!rees t4at #n case of efa"lt #n t4e a)9ent of t4e#nstall9ents "e t4e sa9e s4all earn a le!al rate of #nterest, an to 4#c4 t4e VE%-OR

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l#e#se a!rees.

Sa9e3 Sa9e3 Sa9e3 Sa9e3 4e acts of t4e art#es, conte9oraneo"s an s"(se"ent to t4econtract clearl) s4o t4at an a(sol"te ee of sale as #ntene () t4e art#es an not acontract to sell.F"rt4er9ore, as fo"n () t4e o"rt of Aeals, t4e acts of t4e art#es,conte9oraneo"s an s"(se"ent to t4e contract, clearl) s4o t4at an a(sol"te ee of saleas #ntene () t4e art#es an not a contract to sell>

Sa9e3 Sa9e3 Sa9e3 Sa9e3 Sa9e3 4e contract (e#n! one of a(sol"te sale, t4e oners4# oft4e s"(?ect lot as transferre to t4e (")er "on t4e act"al an constr"ct#ve el#ver) t4ereof.4e contract 4ere (e#n! one of a(sol"te sale, t4e oners4# of t4e s"(?ect lot astransferre to t4e (")er "on t4e act"al an constr"ct#ve el#ver) t4ereof. 4e constr"ct#veel#ver) of t4e s"(?ect lot as 9ae "on t4e e6ec"t#on of t4e ee of sale 4#le t4e act"alel#ver) as effecte 4en t4e r#vate resonents too ossess#on of an constr"cte a4o"se on Lot %o. &22&DA.

Sa9e3 Sa9e3 Sa9e3 Sa9e3 Sa9e3 Sa9e3 -el#ver) of t4e o(?ect of t4e contract #veste t4evenor of t4e oners4# over t4e sa9e an 4e cannot recover t4e t#tle "nless t4e contract #sresolve or resc#ne.4e el#ver) of t4e o(?ect of t4e contract #veste t4e venor of t4eoners4# over t4e sa9e an 4e cannot recover t4e t#tle "nless t4e contract #s resolve orresc#ne "rs"ant to Art#cle 15'2 of t4e %e #v#l oe.

Sa9e3 Sa9e3 Alt4o"!4 r#vate resonentsC co9la#nt (efore t4e tr#al co"rt as eno9#nateas one for sec#f#c erfor9ance, #t #s #n effect an act#on to "#et t#tle.Alt4o"!4 t4e r#vateresonentsC co9la#nt (efore t4e tr#al co"rt as eno9#nate as one for sec#f#cerfor9ance, #t #s #n effect an act#on to "#et t#tle.

Sa9e3 Sa9e3 Sa9e3 A venee #n an oral contract to conve) lan 4o 4a 9ae art a)9entt4ereof, entere "on t4e lan an 4a 9ae val"a(le #9rove9ents t4ereon #s ent#tle to(r#n! s"#t to clear 4#s t#tle to 4#9.A venee #n an oral contract to conve) lan 4o 4a 9aeart a)9ent t4ereof, entere "on t4e lan an 4a 9ae val"a(le #9rove9ents t4ereon, #sent#tle to (r#n! s"#t to clear 4#s t#tle a!a#nst

120

120



t4e venor 4o 4a ref"se to transfer t4e t#tle to 4#9. t #s not necessar) t4at t4e venee 4asan a(sol"te t#tle, an e"#ta(le t#tle (e#n! s"ff#c#ent to clot4e 4#9 #t4 ersonal#t) to (r#n! anact#on to "#et t#tle.

Sa9e3 Sa9e3 Sa9e3 Sa9e3 +rescr#t#on3 +rescr#t#on t4"s cannot (e #nvoe a!a#nst t4er#vate resonents for #t #s a4or#st#c t4at an act#on to "#et t#tle to roert) #n oneCsossess#on #s #9rescr#t#(le.+rescr#t#on t4"s cannot (e #nvoe a!a#nst t4e r#vate

resonents for #t #s a4or#st#c t4at an act#on to "#et t#tle to roert) #n oneCs ossess#on #s#9rescr#t#(le.

+EO% on cert#orar# to rev#e t4e ec#s#on of t4e o"rt of Aeals.


Bernaro S. 4an for et#t#oners.

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Orlano A. $aloe for resonents.

-AV-E, JR., J.>

An act#on eno9#nate as one for sec#f#c erfor9ance an a9a!es as (ro"!4t () t4e

r#vate resonents a!a#nst t4e et#t#oners (efore t4e Re!#onal r#al o"rt <R= of aloocan#t) 4#c4, after "e tr#al, renere a ec#s#on #n favor of t4e et#t#oners. On aeal, t4eresonent o"rt reverse t4e tr#al co"rtCs ec#s#on.

t #s fro9 t4#s ?"!9ent t4at t4e et#t#oners 4ave aeale to t4#s o"rt () a) of a et#t#onfor rev#e on cert#orar#.

4e 9ater#al facts of t4#s case are s#9le an "n#s"te.

+et#t#oner V#cente +#n!ol #s t4e oner of Lot %o. &22& of t4e aastral S"rve) of aloocan,#t4 an area of 5' s"are 9eters, locate at Ba!on! Barr#o, aloocan #t) an 9oreart#c"larl) escr#(e #n ransfer ert#f#cate of #tle <= %o. 7&5 of t4e Re!#str) of -ees ofaloocan #t). On 17 Fe(r"ar) 1';', 4e e6ec"te a -EE- OF ABSOLUE SALE OF O%ED/ALF<1W2= OFG A% U%-V-E- +ORO% OF A +AREL OF LA%- #n favor of Franc#sco %. -onasco

4#c4 as acnole!e (efore a notar) "(l#c. 4e arcel of lan referre to t4ere#n #s Lot%o. &22& an t4e ert#nent ort#ons of t4e oc"9ent rea as follos>

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4at for an #n cons#erat#on of t4e s"9 of @E%Y /OUSA%- A%- FVE /U%-RE- /RY<+20,5&0.00= +ESOS, +4#l##ne "rrenc), t4e VE%-OR 4ere() t4ese resents SELL, O%VEYA%- O%VEY () a) of A(sol"te Sale t4e oneD4alf <1W2= ort#on, e"#valent to o /"nreSevent) Fo"r an o#nt F#ft) <27.50= s"are 9eters, to t4e VE%-EE, t4e a(oveD9ent#oneroert), 4#s 4e#rs, ass#!ns an s"ccessorsD#nD#nterest3

4at t4e VE%-OR 4ere() confesses an acnole!es t4e rece#t of @O /OUSA%-<+2,000.00= +ESOS fro9 VE%-EE as avance <s#c= an art#al a)9ent to t4e a(oveDc#tecons#erat#on of t4e Sale 4ere#n 9ent#one, leav#n! t4erefor a (alance of E#!4teen 4o"sanan F#ve /"nre 4#rt) <+18,5&0= +esos to (e a# #n several e"al #nstall9ents #t4#n aer#o of s#6 <;= )ears, (e!#nn#n! Jan"ar), 1'703

4at after co9"t#n! t4e a(oveD9ent#one e"al #nstall9ents, t4e VE%-EE a!rees an"nertaes to a) "nto t4e VE%-OR a 9ont4l) a9o"nt e"#valent to o /"nre F#ft) Seven<s#c= an 4#rt) S#6 entavos <+257.&;= #t4#n a er#o of Sevent) One <71= 9ont4s an on t4eSeven o s#cG <72= 9ont4, t4e a9o"nt of <+257.= as t4e last an f#nal #nstall9ent t4ereof3

4at t4e VE%-EE a!rees t4at #n case of efa"lt #n t4e a)9ent of t4e #nstall9ents "e t4esa9e s4all earn a le!al rate of #nterest, an to 4#c4 t4e VE%-OR l#e#se a!rees3

4at t4e VE%-EE "nertaes to a) "nto t4e VE%-OR t4e 4ere#n 9ont4l) #nstall9ent #t4#nt4e f#rst f#ve <5= a)s of eac4 9ont4 an t4e sa9e s4all (e 9ae ava#la(le an to (e a# att4e res#ence of t4e VE%-OR, a)9ent to (e 9ae e#t4er #rectl) to t4e VE%-OR, 4#s #fe or4#s a"t4or#He reresentat#ve or factor3

4at #n case of art#t#on of t4e a(oveDescr#(e roert) (eteen 4ere#n VE%-OR anVE%-EE, t4e sa9e s4all (e #v#e #nto to <2= s"al arts, t4e VE%-OR !ets t4e corner fac#n!

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J. -e Jes"s an alolos Aven"e an t4e VE%-EE s4all !et t4e ort#on #t4 f#fteen <15= 9etersfronta!e fac#n! J. -e Jes"s Street onl).1

+"rs"ant to t4e contract, -onasco a# +2,000.00 to +#n!ol. 4e oneD4alf ort#on, es#!nateas Lot %o. &22&DA, as t4en se!re!ate fro9 t4e 9ot4er lot, an t4e art#es reare as"(#v#s#on lan <E64#(#t = 4#c4 as arove () t4e Lan Re!#strat#on o99#ss#on.2

Franc#sco -onasco #99e#atel) too ossess#on of t4e s"(?ect

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1 Rollo, 2&D2.

2 ., 18.

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122



lot an constr"cte a 4o"se t4ereon. n Jan"ar) 1'70, 4e starte a)#n! t4e 9ont4l)#nstall9ents ("t as a(le to a) onl) " to 1'72.

On 1& J"l) 1'8, Franc#sco -onasco #e. At t4e t#9e of 4#s e9#se, 4e 4a a# +8,&;'.00,l"s t4e +2,000.00 avance a)9ent, leav#n! a (alance of +10,1;1.00 on t4e contract r#ce.&Lot %o. &22&DA re9a#ne #n t4e ossess#on of -onascoCs 4e#rs.

On 1' Octo(er 1'88, t4e 4e#rs of Franc#sco -onasco f#le an act#on for Sec#f#c +erfor9ancean -a9a!es, #t4 +ra)er for @r#t of +rel#9#nar) n?"nct#on a!a#nst t4e so"ses V#cente an

Lo"res +#n!ol <et#t#oners 4ere#n= (efore t4e R of aloocan #t). 4e act#on as oceteas #v#l ase %o. 1&572 an raffle off to Branc4 125 of t4e sa# co"rt.

n t4e#r co9la#nt, t4e la#nt#ffs <r#vate resonents 4ere#n= averre t4at after t4e eat4 oft4e#r fat4er, t4e) offere to a) t4e (alance of +10,1;1.00 l"s t4e st#"late le!al rate of#nterest t4ereon to V#cente +#n!ol ("t t4e latter re("ffe t4e#r offer an 4as (een e9an#n!for a (#!!er an "nreasona(le a9o"nt, #n co9lete var#ance to 4at #s laf"ll) "e ana)a(le. 4e) state t4at t4e) 4a e6erte earnest efforts to for!e or reac4 an a9#ca(lean eacef"l settle9ent #t4 t4e efenants for t4e a)9ent of t4e roert) #n "est#on ("tto no ava#l. 4e) f"rt4er alle!e t4at t4e efenants ere co99#tt#n! acts of forc#(le entr)an encroac49ent "on t4e#r lan an ase t4at a r#t of rel#9#nar) #n?"nct#on (e #ss"eto restra#n t4e efenants fro9 t4e acts co9la#ne of.

+la#nt#ffs t4en ra)e t4at t4e efenants (e orere, #nter al#a>

a. 6 6 6 to accet t4e a9o"nt of +10,1;1.00, 9ore or less, l"s t4e st#"late le!al rate of#nterest "e t4ereon, as f"ll an co9lete a)9ent of t4e (alance for t4e a!reer#ceWcons#erat#on on t4e one4alf <1W2= ort#on of t4e arcel of lan 6 6 63 anG

(. 6 6 6 to e6ec"te t4e f#nal ee of sale on t4e oneD4alf <1W2= ort#on of t4e lot 6 6 6 #naccorance #t4 t4e art#t#on reflecte #n t4e s"rve) an s"(#v#s#on lan, 6 6 6.5

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& ., ;.

Anne6 A of +et#t#on3 Rollo, 17D22.

5 ., 21.

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n t4e#r anser #t4 co"ntercla#9,; efenants a9#tte t4e e6ec"t#on of t4e afore9ent#oneee of sale, t4e se!re!at#on of t4e ort#on sol an t4e rearat#on an aroval of t4es"(#v#s#on lan, ("t set " t4e follo#n! sec#al an aff#r9at#ve efenses> <1= t4e la#nt#ffsC

ca"se of act#on 4a alrea) rescr#(e3 <2= t4e ee of sale e9(o#e a con#t#onal contract ofsale as t4e cons#erat#on #s to (e a# on #nstall9ent (as#s #t4#n a er#o of s#6 )ears(e!#nn#n! Jan"ar), 1'703 <&= t4e s"(#v#s#on lan as reare on t4e ass"9t#on t4atFranc#sco -onasco o"l (e a(le to co9l) #t4 4#s o(l#!at#on3 <= 4en Franc#sco #e, 4e4a not f"ll) a# t4e total cons#erat#on a!ree "on3 an <5= cons#er#n! t4e (reac4 ()Franc#sco of 4#s contract"al o(l#!at#on a) (ac #n 1'7;, t4e sale as ee9e to 4ave (eencancelle an t4e cont#n"o"s occ"anc) of Franc#sco after 1'7; an () 4#s 4e#rs t4ereafteras () 9ere tolerance of V#cente +#n!ol. 4e) t4en ase t4at t4e la#nt#ffs (e orere tovacate t4e re9#ses an to a) t4e9 attorne)Cs fees an a reasona(le co9ensat#on for t4e"se of t4e lan.

n t4e#r Rel) an Anser to o"ntercla#9,7 t4e la#nt#ffs o#nte o"t t4at t4ere #s norov#s#on #n t4e ee of sale for #ts cancellat#on #n case of efa"lt #n t4e a)9ent of t4e9ont4l) #nstall9ents an #nvoe Art#cle 15'2 of t4e %e #v#l oe. 4e) sec#f#call) en#et4e alle!at#ons #n t4e co"ntercla#9.

4e #ss"es 4av#n! (een ?o#ne, t4e case as t4en tr#e on t4e 9er#ts.

On 22 Jan"ar) 1''0, t4e tr#al co"rt renere a ec#s#on8 #s9#ss#n! t4e co9la#nt anorer#n! t4e la#nt#ffs to a) t4e efenants +&50.00 as reasona(le 9ont4l) rental for t4e "seof t4e re9#ses fro9 t4e f#l#n! of t4e co9la#nt, +10,000.00 () a) of attorne)Cs fees, an t4ecosts of t4e s"#t. t 4el t4at> <1= t4e ee of a(sol"te sale #n "est#on, 9are an offere #nev#ence as E64#(#t A, #s a contract to sell, not a contract of sale, s#nce V#cente +#n!ol 4a no#ntent#on to art #t4 t4e oners4# of t4e lot "nless t4e f"ll a9o"nt of t4e a!ree r#ce 4a(een a#3 <2= t4e contract as ee9e to 4ave (een cancelle fro9 t4e 9oD

:::::::::::::::

; Anne6 B of +et#t#on3 Rollo, 25D2'.

7 ., &0D&&.

8 Anne6 - of +et#t#on3 Rollo, &D1. +er J"!e $eron#9o S. an!a).

12

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12



9ent t4e late fat4er of t4e la#nt#ffs efa"lte #n t4e a)9ent of t4e 9ont4l) #nstall9ents3 <&=

t#tle an oners4# over t4e lot # not ass to Franc#sco -onasco an 4#s 4e#rs s#nce t4econtract to sell as never cons"99ate3 an <5= ass"9#n!, ar!"eno, t4at t4e la#nt#ffs 4avea ca"se of act#on for sec#f#c erfor9ance, s"c4 act#on 4a alrea) rescr#(e s#nce t4eco9la#nt as f#le onl) on 1' Octo(er 1'88 or 9ore t4an ten )ears fro9 t4e t#9e t4at t4e)co"l 4ave laf"ll) e9ane erfor9ance.'

+la#nt#ffs elevate t4e case to t4e o"rt of Aeals 4ere t4e aeal as ocete as AD$.R.V %o. 25';7. On 12 %ove9(er 1''1, t4e sa# co"rt renere a ec#s#on10 revers#n! t4eaeale ec#s#on an ecree#n! as follos>

@/EREFORE, t4e ec#s#on aeale fro9 #s 4ere() REVERSE- an SE AS-E an anot4er one#s renere>

<1= Orer#n! aelleeDvenor V#cente +#n!ol to accet t4e s"9 of +10,1;1.00, l"s t4e le!al#nterest "e t4ereon fro9 t4e ate of #nst#t"t#on of t4#s act#on on Octo(er 1', 1'883

<2= U4ol#n! t4e val##t) of t4e Q-EE- OF ABSOLUE SALE OF O%ED/ALF <1W2= <of= A%U%-V-E- +ORO% OF A +AREL OF LA%-C <E64. A=, an () v#rt"e an on t4e stren!t4 of4#c4 eclar#n! t4e Q/e#rs of t4e -ecease Franc#sco %. -o9#n!oC as t4e oners of t4e 27.50s. 9. lan, eno9#nate as Lot &22&DA, <LR= +sD1;225 "ner t4e tec4n#cal escr#t#on<e64. -= an reflecte #n t4e +lan of S"(#v#s#on S"rve) 4#c4 as arove B) o99#ss#onerof Lan Re!#strat#on on A"!"st 1&, 1'71 <e64. =, reresent#n! oneD4alf ort#on ofG lot &22&,s#t"ate at t4e corner of alolos Aven"e an $. e Jes"s St., Ba!on! Barr#o, aloocan #t), ancovere () %o. 7&5 of t4e Re!#str) of -ees of aloocan #t) <e64. B=3 an

<&= Orer#n! t4e efenantsDaellees to a) t4e costs.

SO OR-ERE-.11

4e o"rt of Aeals r"le t4at t4e ee of sale #n "est#on reveals t4e clear #ntent#on ofV#cente +#n!ol to art #t4 t4e

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' ., &8D1.

10 Anne6 $ of +et#t#on3 ., ;0D7&. +er Assoc#ate J"st#ce Arte9on -. L"na, conc"rre #n ()Assoc#ate J"st#ces elso L. a!s#no an Ja#nal -. Ras"l.

11 Rollo, 72D7&.

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oners4# of t4e oneD4alf ort#on of t4e lan () a) of an a(sol"te sale3 t4at t4e fa#l"re to

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f"ll) a) t4e a!ree r#ce as not a !ro"n for t4e cancellat#on of t4e sale3 an t4at t4ela#nt#ffsC act#on #s #9rescr#t#(le s#nce #t #s a#n to an act#on to "#et t#tle to roert) #noneCs ossess#on.12

-#ssat#sf#e #t4 t4e ec#s#on of t4e o"rt of Aeals, t4e efenants, 4ere#nafter referre toas t4e et#t#oners, f#le t4#s et#t#on for cert#orar# on ' Jan"ar) 1''2. +la#nt#ffs, 4ere#nafterreferre to as t4e r#vate resonents, f#le t4e#r co99ent t4ereto on 10 Sete9(er 1''2 to

4#c4 t4e et#t#oners f#le a rel) on 11 %ove9(er 1''2. @e !ave "e co"rse to t4e et#t#onan re"#re t4e art#es to s"(9#t t4e#r resect#ve 9e9orana,1& 4#c4 t4e) s"(se"entl)co9l#e #t4.

+et#t#oners conten t4at t4e o"rt of Aeals erre>

% /OL-%$ /A /E -OUE% <E/B A= -E%O%AE- AS QABSOLUE -EE- OF SALEOF O%ED/ALF <1W2= OF A% U%-V-E- +ORO% OF A +AREL OF LA%-C S A% ABSOLUE -EE-OF SALE SUFFE% O O%FER O@%ERS/+ O% /E VE%-EE A%- /S SUESSORSD%D%ERES, -ES+E /E FA /A BY S ERS A%- O%-O%S, LE /E +RE BE%$

+AYABLE O% %SALLE%S @/% A FE- +ERO-, /E SAE S A O%-O%AL -EE- OFSALE.

% /OL-%$ /A %O@/SA%-%$ /E FA /A /E VE%-EE FALE- O O+LY @//E ERS OF /E O%RA <E/B A= S+EFALLY O O+LEE /E +AYE% OF /EO%S-ERAO% O% /E -AE S+ULAE- % /E O%RA @// @AS SU++OSE- O BE % JA%UARY 1'7;, O+LEE +AYE% /EREOF A% SLL BE E%FORE- % A% AO%%SUE- BY /E /ERS OF /E VE%-EE FLE- O% OOBER 1', 1'88 OR A +ERO- OF ORE/A% @ELVE <12= YEARS FRO /E E O+LEE +AYE% S/OUL- /AVE BEE% A-E3

:::::::::::::::

12 ., ;7D71.

1& Rollo, '7.

12;

12;



% /OL-%$ /A /E +RVAE RES+O%-E%SC AO% S O%E @// S A% OFFER OO+LEE /E +AYE% LEF U%+A- BY +RVAE RES+O%-E%SC FA/ER @// -OES %O

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+RESRBE3

V

% /OL-%$ /A +RVAE RES+O%-E%SC AUSE OF AO% /AS %O +RESRBE-.1

4e ec#s#ve #ss"e #n t4#s case #s 4et4er E64#(#t A e9(o#es a contract of sale or a contractto sell. 4e #st#nct#on (eteen t4e to #s #9ortant for #n a contract of sale, t4e t#tle assesto t4e venee "on t4e el#ver) of t4e t4#n! sol, 4ereas #n a contract to sell, () a!ree9ent,oners4# #s reserve #n t4e venor an #s not to ass "nt#l t4e f"ll a)9ent of t4e r#ce. n acontract of sale, t4e venor 4as lost an cannot recover oners4# "nt#l an "nless t4econtract #s resolve or resc#ne, 4ereas #n a contract to sell, t#tle #s reta#ne () t4e venor"nt#l t4e f"ll a)9ent of t4e r#ce, s"c4 a)9ent (e#n! a os#t#ve s"sens#ve con#t#on, fa#l"reof 4#c4 #s not a (reac4 ("t an event t4at revente t4e o(l#!at#on of t4e venor to conve)t#tle fro9 (eco9#n! effect#ve.15

A er"sal of E64#(#t A leas to no ot4er concl"s#on t4an t4at #t e9(o#es a contract of sale.4e la#n an clear tenor of t4e -EE- OF ABSOLUE SALE OF O%ED/ALF <1W2= OFG A%U%-V-E- +ORO% OF A +AREL OF LA%- #s t4at t4e VE%-OR 4ere() 6 6 6 SELL, O%VEY

A%- O%VEY () a) of A(sol"te Sale t4e oneD4alf <1W2= ort#on 6 6 6 to t4e VE%-EE 6 6 6 4#s4e#rs, ass#!ns an s"ccessorsD#nD#nterest. 4at t4e venor, et#t#oner V#cente +#n!ol, 4a t4atclear #ntent#on as f"rt4er ev#ence () 4#s fa#l"re to reserve 4#s t#tle t4ereto "nt#l t4e f"lla)9ent of t4e r#ce.

:::::::::::::::

1 Rollo, 8.

15 L#9 vs. o"rt of Aeals, 182 SRA 5; 1''0G3 Jac#nto vs. aaraH, 20' SRA 2; 1''2G3V#sa)an Sa9#ll o., nc. vs. o"rt of Aeals, $.R. %o. 8&851, & arc4 1''&.

127

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127


n -#!nos vs. o"rt of Aeals,1;e 4el t4at a ee of sale #s a(sol"te #n nat"re alt4o"!4eno9#nate as a -ee of on#t#onal Sale 4ere t4ere #s no st#"lat#on #n t4e ee t4att#tle to t4e roert) sol #s reserve #n t4e seller "nt#l t4e f"ll a)9ent of t4e r#ce, nor #st4ere a st#"lat#on !#v#n! t4e venor t4e r#!4t to "n#laterall) resolve t4e contract t4e 9o9entt4e (")er fa#ls to a) #t4#n a f#6e er#o. E64#(#t A conta#ns ne#t4er st#"lat#on. @4at #s9erel) state t4ere#n #s t4at t4e VE%-EE a!rees t4at #n case of efa"lt #n t4e a)9ent of t4e#nstall9ents "e t4e sa9e s4all earn a le!al rate of #nterest, an to 4#c4 t4e VE%-ORl#e#se a!rees.

F"rt4er9ore, as fo"n () t4e o"rt of Aeals, t4e acts of t4e art#es, conte9oraneo"s ans"(se"ent to t4e contract, clearl) s4o t4at an a(sol"te ee of sale as #ntene, () t4eart#es an not a contract to sell.

+G"rs"ant to t4e ee, t4e venor el#vere act"al an constr"ct#ve ossess#on of t4eroert) to t4e venee, 4o occ"#e an too s"c4 ossess#on, constr"cte a ("#l#n!

8/14/2019 sales (1).rtf


t4ereon, 4a t4e roert) s"rve)e an s"(#v#e an a lan of t4e roert) as rearean s"(9#tte to t4e Lan Re!#strat#on o99#ss#on 4#c4 arove #t rearator) tose!re!at#n! t4e sa9e an o(ta#n#n! t4e correson#n! #n 4#s na9e. S#nce t4e sale,aellee cont#n"o"sl) ossesse an occ"#e t4e roert) as oner " to 4#s eat4 on J"l)1&, 1'8 an 4#s 4e#rs, after 4#s eat4, cont#n"e t4e occ"anc) an ossess#on of t4eroert) " to t4e resent. 4ose conte9oraneo"s an s"(se"ent events are e9onstrat#veacts t4at t4e venor s#nce t4e sale reco!n#He t4e venee as t4e a(sol"te oner of t4e

roert) sol. All t4ose attr#("tes of oners4# are a9#tte () efenants #n t4e#r anser,sec#f#call) #n ara!ra4s 7 a ' of t4e#r sec#al an aff#r9at#ve efenses.17

4e contract 4ere (e#n! one of a(sol"te sale, t4e oners4# of t4e s"(?ect lot as transferreto t4e (")er "on t4e act"al an constr"ct#ve el#ver) t4ereof. 4e constr"ct#ve el#ver) oft4e s"(?ect lot as 9ae "on t4e e6ec"t#on of t4e ee of sale18 4#le t4e act"al el#ver)as effecte 4en t4e r#vate resonD

:::::::::::::::

1; 158 SRA &75 1'88G.

17 Rollo, ;8.

18 Art#cle 1'8, %e #v#l oe.

128

128



ents too ossess#on of an constr"cte a 4o"se on Lot %o. &22&DA.

4e el#ver) of t4e o(?ect of t4e contract #veste t4e venor of t4e oners4# over t4e sa9ean 4e cannot recover t4e t#tle "nless t4e contract #s resolve or resc#ne "rs"ant to Art#cle15'2 of t4e %e #v#l oe 4#c4 rov#es t4at>

n t4e sale of #99ova(le roert), even t4o"!4 #t 9a) 4ave (een st#"late t4at "on fa#l"reto a) t4e r#ce at t4e t#9e a!ree "on t4e resc#ss#on of t4e contract s4all of r#!4t taelace, t4e venee 9a) a), even after t4e e6#rat#on of t4e er#o, as lon! as no e9an forresc#ss#on of t4e contract 4as (een 9ae "on 4#9 e#t4er ?"#c#all) or () a notar#al act. Aftert4e e9an, t4e co"rt 9a) not !rant 4#9 a ne ter9.

Bot4 t4e tr#al co"rt an t4e o"rt of Aeals # not f#n t4at a notar#al or ?"#c#al resc#ss#onof t4e contract 4a (een 9ae. Alt4o"!4 V#cente +#n!ol asserts t4at 4e 4a eclare toFranc#sco -onasco t4at 4e as cancell#n! t4e contract, 4e # not rove t4at 4#s e9an for

resc#ss#on as 9ae e#t4er ?"#c#all) or () a notar#al act.

+et#t#oners fa"lt t4e resonent o"rt for 4ol#n! t4at t4e act#on of t4e et#t#oners #s not(arre () t4e stat"te of l#9#tat#ons. 4e) ar!"e t4at t4e r#vate resonentsC act#on, (e#n!(ase "on a r#tten contract, 4as rescr#(e s#nce #t as (ro"!4t onl) #n 1'88 or 9ore t4anten )ears fro9 t4e t#9e 4en t4e latter co"l 4ave laf"ll) e9ane erfor9ance.1'

@e #sa!ree.

Alt4o"!4 t4e r#vate resonentsC co9la#nt (efore t4e tr#al co"rt as eno9#nate as onefor sec#f#c erfor9ance, #t #s #n effect an act#on to "#et t#tle. n t4#s re!ar, t4e follo#n!

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e6cert fro9 B"cton vs. $a(ar20#saroos>

4e real an "lt#9ate (as#s of et#t#onersC act#on #s t4e#r oners4# of oneD4alf of t4e lotco"le #t4 t4e#r ossess#on t4ereof, 4#c4 ent#tles t4e9 to a conve)ance of t4e roert). nSato, et al. v. Fa(#ana

:::::::::::::::

1' Art#cle 11, %e #v#l oe.

20 55 SRA '' 1'7G3 see also, $allar vs. /"sa#n, 20 SRA 18; 1';7G.

12'

VOL. 22;, SE+EBER ;, 1''&

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10& +4#l. ;8&, ;8;D87 <1'58=G, t4#s o"rt, sea#n! t4r" r. J"st#ce J.B.L. Re)es, e6la#ne t4at"ner t4e c#rc"9stances no enforce9ent of t4e contract #s neee, s#nce t4e el#ver) ofossess#on of t4e lan sol 4a cons"99ate t4e sale an transferre t#tle to t4e "rc4aser,an t4at, act"all), t4e act#on for conve)ance #s one to "#et t#tle, #.e., to re9ove t4e clo""on t4e aelleeCs oners4# () t4e ref"sal of t4e aellants to reco!n#He t4e sale 9ae ()t4e#r reecessors.

4at a clo" 4as (een cast on t4e t#tle of t4e r#vate resonents #s #n"(#ta(le. -es#te t4efact t4at t4e t#tle 4a (een transferre to t4e9 () t4e e6ec"t#on of t4e ee of sale an t4eel#ver) of t4e o(?ect of t4e contract, t4e et#t#oners aa9antl) ref"se to accet t4e tenerof a)9ent () t4e r#vate resonents an steafastl) #ns#ste t4at t4e#r o(l#!at#on totransfer t#tle 4a (een renere #neffect#ve.

A venee #n an oral contract to conve) lan 4o 4a 9ae art a)9ent t4ereof, entere "ont4e lan an 4a 9ae val"a(le #9rove9ents t4ereon, #s ent#tle to (r#n! s"#t to clear 4#st#tle a!a#nst t4e venor 4o 4a ref"se to transfer t4e t#tle to 4#9. t #s not necessar) t4att4e venee 4as an a(sol"te t#tle, an e"#ta(le t#tle (e#n! s"ff#c#ent to clot4e 4#9 #t4ersonal#t) to (r#n! an act#on to "#et t#tle.21

+rescr#t#on t4"s cannot (e #nvoe a!a#nst t4e r#vate resonents for #t #s a4or#st#c t4at anact#on to "#et t#tle to roert) #n oneCs ossess#on #s #9rescr#t#(le.22 4e rat#onale for t4#sr"le 4as (een atl) state t4"s>

4e oner of real roert) 4o #s #n ossess#on t4ereof 9a) a#t "nt#l 4#s ossess#on #s#nvae or 4#s t#tle #s attace (efore ta#n! stes to v#n#cate 4#s r#!4t. A erson cla#9#n!t#tle to real roert), ("t not #n ossess#on t4ereof, 9"st act aff#r9at#vel) an #t4#n t4e t#9e

rov#e () t4e stat"te. +ossess#on #s a cont#n"#n! r#!4t as #s t4e r#!4t to efen s"c4ossess#on. So #t 4as (een eter9#ne t4at an oner of real roert) #n ossess#on 4as acont#n"#n! r#!4t to #nvoe a co"rt of e"#t) to re9ove a clo" t4at #s a cont#n"#n! 9enace to4#s t#tle. S"c4 a

:::::::::::::::

21 O?ea vs. O?ea, ;1 S.@. 2 87 <e6. #v. A. 1'70=.

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22 Sato vs. Fa(#ana, 10& +4#l. ;8& 1'58G3 B"cton vs. $a(ar, s"ra3 ara!a)DLa)no vs. o"rtof Aeals, 1&& SRA 718 1'8G3 oronel vs. nter9e#ate Aellate o"rt, 155 SRA 2701'87G3 Sol# State "lt#D+ro"cts or. vs. o"rt of Aeals, 1'; SRA ;&0 1''1G.

1&0

1&0



9enace #s co9are to a cont#n"#n! n"#sance or tresass 4#c4 #s treate as s"ccess#ven"#sances or tresasses, not (arre () stat"te "nt#l cont#n"e #t4o"t #nterr"t#on for alen!t4 of t#9e s"ff#c#ent to affect a c4an!e of t#tle as a 9atter of la.2&

+r#vate resonents s4all, 4oever, (e l#a(le to a) t4e le!al rate of #nterest on t4e "na#(alance of t4e "rc4ase r#ce fro9 t4e ate of efa"lt or on ; Jan"ar) 1'7;, 4en t4e ent#re(alance s4o"l 4ave (een a#, "rs"ant to t4e rov#s#on #n t4e ee of sale.

@/EREFORE, e6cet as a(ove 9o#f#e, t4e -ec#s#on aeale fro9 #s 4ere() AFFRE-. As9o#f#e, t4e #nterest on t4e "na# (alance of +10,1;1.00, at t4e le!al rate, s4all (eco9"te fro9 ; Jan"ar) 1'7;. Uon t4e a)9ent () t4e r#vate resonents to t4eet#t#oners of t4e sa# a9o"nt an t4e #nterest t4ereon, t4e latter are orere to el#verransfer ert#f#cate of #tle %o. 7&5 to t4e Re!#ster of -ees of aloocan #t) 4o s4all cancelt4e sa9e an #ss"e to ne transfer cert#f#cates of t#tle #n l#e" t4ereof, one of 4#c4 s4all (e#n t4e na9e of t4e 4ere#n r#vate resonents cover#n! Lot %o. &22&DA an t4e ot4er #n t4ena9e of t4e et#t#oners cover#n! t4e re9a#ner of t4e lot.

SO OR-ERE-.

r"H <4a#r9an=, $r#KoDA"#no, Bellos#llo an N"#ason, JJ., conc"r.

Aeale ec#s#on aff#r9e #t4 9o#f#cat#on.

%ote.+ro9#se to sell o not transfer t#tle "nt#l f"lf#ll9ent of a os#t#ve s"sens#ve con#t#on<Alfonso vs. o"rt of Aeals, 18; SRA 00=. +#n!ol vs. o"rt of Aeals, 22; SRA118<1''&=G

sales (1).rtf

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