sales set 2 cases

7/23/2019 Sales Set 2 Cases

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Republic of the PhilippinesSUPREME COURT

Manila

THIRD DIVISION

G.R. No. 107207 November 23, 1995

VIRGILIO R. ROMERO, petitioner,vs.HON. COURT O !PPE!LS "#$ ENRI%UET! CHU! V&!. &E ONGSIONG, respondents.

VITUG, J.:

The parties pose this uestion! Ma" the vendor de#and the rescission of a contract for the sale of aparcel of land for a cause traceable to his o$n failure to have the suatters on the sub%ect propert"evicted $ithin the contractuall"&stipulated period'

Petitioner Vir(ilio R. Ro#ero, a civil en(ineer, $as en(a(ed in the business of production,#anufacture and e)portation of perlite filter aids, per#alite insulation and processed perlite ore. In*+, petitioner and his forei(n partners decided to put up a central $arehouse in Metro Manila on aland area of appro)i#atel" -, suare #eters. The pro%ect $as #ade /no$n to several freelancereal estate bro/ers.

0 da" or so after the announce#ent, 0lfonso 1lores and his $ife, acco#panied b" a bro/er, offered a

parcel of land #easurin( *,+2- suare #eters. 3ocated in 4aran(a" San Dionisio, Para5aue,Metro Manila, the lot $as covered b" T6T No. 78*9- in the na#e of private respondent :nriueta6hua vda. de On(sion(. Petitioner visited the propert" and, e)cept for the presence of suatters inthe area, he found the place suitable for a central $arehouse.

3ater, the 1lores spouses called on petitioner $ith a proposal that should he advance the a#ount ofP2,. $hich could be used in ta/in( up an e%ect#ent case a(ainst the suatters, privaterespondent $ould a(ree to sell the propert" for onl" P. per suare #eter. Petitioner e)pressedhis concurrence. On + ;une *+, a contract, deno#inated


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&and&

VIRBI3IO R. ROM:RO, #arried to Severina 3. 3at, of 3e(al a(e,1ilipino, and residin( at ** San Mi(uel St., Plainvie$ Subd.,Mandalu"on( Metro Manila, hereinafter referred to as the V:ND::!

> I T N : S S : T H ! That

>H:R:0S, the V:NDOR is the o$ner of One E*F parcel of land $ith a total area ofON: THOAS0ND NIN: HANDR:D 1I1T? T>O E*,+2-F S@A0R: M:T:RS, #oreor less, located in 4arrio San Dionisio, Municipalit" of Para5aue, Province of RiCal,covered b" T6T No. 78*9- issued b" the Re(istr" of Deeds of Pasi( and #oreparticularl" described as follo$s!

))) ))) )))

>H:R:0S, the V:ND::, for EsicF has offered to bu" a parcel of land and theV:NDOR has accepted the offer, sub%ect to the ter#s and conditions hereinafter

stipulated!

NO>, TH:R:1OR:, for and in consideration of the su# of ON: MI33ION 1IV:HANDR:D SIGT? ON: THOAS0ND SIG HANDR:D P:SOS EP*,28*,8.FON3?, Philippine 6urrenc", pa"able b" V:ND:: to in to EsicF #anner set forth, theV:NDOR a(rees to sell to the V:ND::, their heirs, successors, ad#inistrators,e)ecutors, assi(n, all her ri(hts, titles and interest in and to the propert" #entioned inthe 1IRST >H:R:0S 630AS:, sub%ect to the follo$in( ter#s and conditions!

*. That the su# of 1I1T? THOAS0ND P:SOS EP2,.F ON3?Philippine 6urrenc", is to be paid upon si(nin( and e)ecution of thisinstru#ent.

-. The balance of the purchase price in the a#ount of ON: MI33ION1IV: HANDR:D :3:V:N THOAS0ND SIG HANDR:D P:SOSEP*,2**,8.F ON3? shall be paid 92 da"s after the re#oval of allsuatters fro# the above described propert".

7. Apon full pa"#ent of the overall purchase price as aforesaid,V:NDOR $ithout necessit" of de#and shall i##ediatel" si(n,e)ecute, ac/no$led(ed EsicF and deliver the correspondin( deed ofabsolute sale in favor of the V:ND:: free fro# all liens andencu#brances and all Real :state ta)es are all paid and updated.

It is hereb" a(reed, covenanted and stipulated b" and bet$een the parties heretothat if after 8 da"s fro# the date of the si(nin( of this contract the V:NDOR shallnot be able to re#ove the suatters fro# the propert" bein( purchased, thedo$npa"#ent #ade b" the bu"er shall be returnedrei#bursed b" the V:NDOR tothe V:ND::.

That in the event that the V:ND:: shall not be able to pa" the V:NDOR the balanceof the purchase price of ON: MI33ION 1IV: HANDR:D :3:V:N THOAS0ND SIGHANDR:D P:SOS EP*,2**,8.F ON3? after 92 da"s fro# $ritten notification to


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the V:ND:: of the re#oval of the suatters fro# the propert" bein( purchased, the1I1T? THOAS0ND P:SOS EP2,.F previousl" paid as do$npa"#ent shall beforfeited in favor of the V:NDOR.

:)penses for the re(istration such as re(istration fees, docu#entar" sta#p, transferfee, assurances and such other fees and e)penses as #a" be necessar" to transfer

the title to the na#e of the V:ND:: shall be for the account of the V:ND:: $hilecapital (ains ta) shall be paid b" the V:NDOR.

IN >ITN:SS >H:R:O1, the parties hereunto si(ned those EsicF presents in the 6it"of Ma/ati MM, Philippines on this +th da" of ;une, *+.

ES(d.F ES(d.F

VIRBI3IO R. ROM:RO :NRI@A:T0 6HA0 VD0.

D: ONBSIONB

Vendee Vendor

SIBN:D IN TH: PR:S:N6: O1!

ES(d.F ES(d.F

Ro$ena 6. On(sion( ;ac/ M. 6ruC 1

0lfonso 1lores, in behalf of private respondent, forth$ith received and ac/no$led(ed achec/ for P2,.2fro# petitioner.3

Pursuant to the a(ree#ent, private respondent filed a co#plaint for e%ect#ent E6ivil 6ase No. 2+Fa(ainst Melchor Musa and -+ other suatter fa#ilies $ith the Metropolitan Trial 6ourt of Para5aue.

0 fe$ #onths later, or on -* 1ebruar" *++, %ud(#ent $as rendered orderin( the defendants tovacate the pre#ises. The decision $as handed do$n be"ond the 8&da" period Ee)pirin( + 0u(ust*+F stipulated in the contract. The $rit of e)ecution of the %ud(#ent $as issued, still later, on 7March *++.

In a letter, dated 0pril *++, private respondent sou(ht to return the P2,. she receivedfro# petitioner since, she said, she could not


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On ;une *++, 0tt". 0postol re#inded private respondent on the e)pir" of the 92&da" (raceperiod and his clientJs $illin(ness to


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H:R:1OR:, the decision appealed fro# is R:V:RS:D and S:T 0SID:, and ane$ one entered declarin( the contract of conditional sale dated ;une +, *+cancelled and orderin( the defendant&appellee to accept the return of thedo$npa"#ent in the a#ount of P2,. $hich $as deposited in the court belo$.No pronounce#ent as to costs. 11

1ailin( to obtain a reconsideration, petitioner filed this petition for revie$ on certiorariraisin( issuesthat, in fine, center on the nature of the contract adverted to and the P2,. re#ittance #ade b"petitioner.

0 perfected contract of sale #a" either be absolute or conditional12dependin( on $hether thea(ree#ent is devoid of, or sub%ect to, an" condition i#posed on thepassingof title of the thin( to be

conve"ed or on the obligationof a part" thereto. >hen o$nership is retained until the fulfill#ent of apositive condition the breach of the condition $ill si#pl" prevent the dut" to conve" title fro# acuirin(an obligatory force. If the condition is i#posed on an obligationof a part" $hich is not co#plied $ith,the other party #a" either refuse to proceed or $aive said condition E0rt. *292, 6ivil 6odeF. >here, ofcourse, the condition is i#posed upon theperfectionof the contract itself, the failure of such condition$ould prevent the %uridical relation itself fro# co#in( into e)istence. 13

In deter#inin( the real character of the contract, the title (iven to it b" the parties is not as #uchsi(nificant as its substance. 1or e)a#ple, a deed of sale, althou(h deno#inated as a deed of


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conditional sale, #a" be treated as absolute in nature, if title to the propert" sold is not reserved inthe vendor or if the vendor is not (ranted the ri(ht to unilaterall" rescind the contract predicatedon the fulfill#ent or non&fulfill#ent, as the case #a" be, of the prescribed condition. 1'

The ter# e share the opinion of the appellate court that the underta/in( reuired of private respondent doesnot constitute a


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#a/e arran(e#ents $ith the sheriff to effect such e)ecution. In his letter of -7 ;une *++, counsel forpetitioner has tendered pa"#ent and de#anded forth$ith the e)ecution of the deed of absolute sale.Parentheticall", this offer to pa", havin( been #ade prior to the de#and for rescission, assu#in( for thesa/e of ar(u#ent that such a de#and is proper under 0rticle *2+-23of the 6ivil 6ode, $ould li/e$isesuffice to defeat private respondentJs prero(ative to rescind thereunder.

There is no need to still belabor the uestion of $hether the P2,. advance pa"#ent isrei#bursable to petitioner or forfeitable b" private respondent, since, on the basis of our fore(oin(conclusions, the #atter has ceased to be an issue. Suffice it to sa" that petitioner havin( opted toproceed $ith the sale, neither #a" petitioner de#and its rei#burse#ent fro# private respondent nor#a" private respondent sub%ect it to forfeiture.

>H:R:1OR:, the uestioned decision of the 6ourt of 0ppeals is hereb" R:V:RS:D 0ND S:T0SID:, and another is entered orderin( petitioner to pa" private respondent the balance of thepurchase price and the latter to e)ecute the deed of absolute sale in favor of petitioner. No costs.

SO ORD:R:D.

Feliciano !o"ero #elo and $anganiban %%& concur&

oo*#o*e+

* Records, pp. 8&8*.

- :)h. +.

7 :)h. -.

9 Records, p. **8.

2 :)h. &4.

8 :)h. D.

Records, pp. 9&2.

Presided b" ;ud(e 4uenaventura ;. Buerrero.

+ Records, p. -2.

* Penned b" 0ssociate ;ustice 1er#in 0. Martin, ;r. and concurred in b" 0ssociate;ustices :#eterio 6. 6ui and 6eCar D. 1rancisco.

** !ollo, p. 98.

*- 0rt. *92, second para(raph, 6ivil 6ode of the Philippines.

*7 See0n( ?u 0suncion, et al., vs. 6ourt of 0ppeals, -7 S6R0 8-.


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*9 Ibid., Vol. V, p. 7 citingDi(nos v. 6ourt of 0ppeals, No. 3&2+-88, 1ebruar" -+,*+, *2 S6R0 72.

*2 0rt. *92. The contract of sale is perfected at the #o#ent there is a #eetin( of#inds upon the thin( $hich is the ob%ect of the contract and upon the price.

1ro# that #o#ent, the parties #a" reciprocall" de#and perfor#ance, sub%ect to theprovisions of the la$ (overnin( the for# of contracts.

*8 0rt. *292. >here the obli(ation of either part" to a contract of sale is sub%ect toan" condition $hich is not perfor#ed, such part" #a" refuse to proceed $ith thecontract or he #a" $aive perfor#ance of the condition. If the other part" haspro#ised that the condition should happen or be perfor#ed, such first #entionedpart" #a" also treat the nonperfor#ance of the condition as a breach of $arrant".

>here the o$nership in the thin( has not passed, the bu"er #a" treat the fulfill#entb" the seller of his obli(ation to deliver the sa#e as described and as $arrantede)pressl" or b" i#plication in the contract of sale as a condition of the obli(ation of

the bu"er to perfor# his pro#ise to accept and pa" for the thin(.

* 0rt. **-. >hen the fulfill#ent of the condition depends upon the sole $ill of thedebtor, the conditional obli(ation shall be void. If it depends upon chance or upon the$ill of a third person, the obli(ation shall ta/e effect in confor#it" $ith the provisionsof this 6ode.

* Decision, p. *.

*+ See Os#e5a vs. Ra#a, *9 Phil. ++.

- See! Intestate :state of the 3ate Ricardo P. Presbitero, Sr. v. 6ourt of 0ppeals,

-* S6R0 7-.

-* In 4o"sa$ v. Interphil. Pro#otions, Inc. E*9 S6R0 872, 897F, the 6ourt has said!


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Republic of the PhilippinesSUPREME COURT

Manila

:N 40N6

G.R. No. L11)27 -/ 31, 19(1

ERN!N&O !. G!ITE,plaintiff&appellee,vs.IS!ELO ON!CIER, GEORGE R!OER, L!R!P MINES 4 SMELTING CO., INC.,SEGUN&IN! VIV!S, RN!CISCO &!NTE, P!CIICO ESC!N&OR "#$ ERN!N&OT,defendants&appellants.

Ale'o #abanag for plaintiff(appellee&Si"plicio )& Tapia Antonio *arredo and $edro +uevarra for defendants(appellants&

REES, -..L., J.6

This appeal co#es to us directl" fro# the 6ourt of 1irst Instance because the clai#s involveda((re(ate #ore than P-,..

Defendant&appellant Isabelo 1onacier $as the o$ner andor holder, either b" hi#self or in arepresentative capacit", of ** iron lode #ineral clai#s, /no$n as the Da$ahan Broup, situated in the#unicipalit" of ;ose Pan(aniban, province of 6a#arines Norte.

4" a


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b. The balance of SIGT?&1IV: THOAS0ND P:SOS EP82,.F $ill be paid fro# and outof the first letter of credit coverin( the first ship#ent of iron ores and of the first a#ountderived fro# the local sale of iron ore #ade b" the 3arap Mines L S#eltin( 6o. Inc., itsassi(ns, ad#inistrators, or successors in interests.

To secure the pa"#ent of the said balance of P82,., 1onacier pro#ised to e)ecute in favor of

Baite a suret" bond, and pursuant to the pro#ise, 1onacier delivered to Baite a suret" bond datedDece#ber , *+29 $ith hi#self E1onacierF as principal and the 3arap Mines and S#eltin( 6o. and itsstoc/holders Beor(e =ra/o$er, Se(undina Vivas, Pacifico :scandor, 1rancisco Dante, and1ernando T" as sureties E:)hibit


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E*F >hether or not the obli(ation of 1onacier and his sureties to pa" Baite P82,. beco#e dueand de#andable $hen the defendants failed to rene$ the suret" bond under$ritten b" the 1ar:astern Suret" and Insurance 6o., Inc. E:)hibit


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a. T:N THOAS0ND P:SOS EP*,.F $ill be paid upon the si(nin( of this a(ree#ent.

b. The balance of SIGT?&1IV: THOAS0ND P:SOS EP82,.F$ill be paid fro# and out ofthe first letter of credit coverin( the first ship#ent of iron ore #ade b" the 3arap Mines LS#eltin( 6o., Inc., its assi(ns, ad#inistrators, or successors in interest.

>e find the court belo$ to be le(all" correct in holdin( that the ship#ent or local sale of the iron oreis not a condition precedent Eor suspensiveF to the pa"#ent of the balance of P82,., but $asonl" a suspensive period or ter#. >hat characteriCes a conditional obli(ation is the fact that itsefficac" or obli(ator" force Eas distin(uished fro# its de#andabilit"F is subordinated to thehappenin( of a future and uncertain event so that if the suspensive condition does not ta/e place,the parties $ould stand as if the conditional obli(ation had never e)isted. That the parties to thecontract :)hibit hilein a sale the obli(ation of one part" can be la$full" subordinated to an uncertain event, so that theother understands that he assu#es the ris/ of receivin( nothin( for $hat he (ives Eas in the case ofa sale of hopes or e)pectations, e"ptio speiF, it is not in the usual course of business to do sohence, the contin(ent character of the obli(ation #ust clearl" appear. Nothin( is found in the recordto evidence that Baite desired or assu#ed to run the ris/ of losin( his ri(ht over the ore $ithout(ettin( paid for it, or that 1onacier understood that Baite assu#ed an" such ris/. This is proved b"

the fact that Baite insisted on a bond a to (uarantee pa"#ent of the P82,., an not onl" upon abond b" 1onacier, the 3arap Mines L S#eltin( 6o., and the co#pan"Js stoc/holders, but also on oneb" a suret" co#pan" and the fact that appellants did put up such bonds indicates that the" ad#ittedthe definite e)istence of their obli(ation to pa" the balance of P82,..

7F To subordinate the obli(ation to pa" the re#ainin( P82,. to the sale or ship#ent of the oreas a condition precedent, $ould be tanta#ount to leavin( the pa"#ent at the discretion of the debtor,for the sale or ship#ent could not be #ade unless the appellants too/ steps to sell the ore.

0ppellants $ould thus be able to postpone pa"#ent indefinitel". The desireabilit" of avoidin( such aconstruction of the contract :)hibit


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and there can be no uestion that (reater reciprocit" obtains if the bu"erJ obli(ation is dee#ed to beactuall" e)istin(, $ith onl" its #aturit" Edue dateF postponed or deferred, that if such obli(ation $erevie$ed as non&e)istent or not bindin( until the ore $as sold.

The onl" rational vie$ that can be ta/en is that the sale of the ore to 1onacier $as a sale on credit,and not an aleator" contract $here the transferor, Baite, $ould assu#e the ris/ of not bein( paid at

all and that the previous sale or ship#ent of the ore $as not a suspensive condition for the pa"#entof the balance of the a(reed price, but $as intended #erel" to fi) the future date of the pa"#ent.

This issue settled, the ne)t point of inuir" is $hether appellants, 1onacier and his sureties, still havethe ri(ht to insist that Baite should $ait for the sale or ship#ent of the ore before receivin( pa"#entor, in other $ords, $hether or not the" are entitled to ta/e full advanta(e of the period (ranted the#for #a/in( the pa"#ent.

>e a(ree $ith the court belo$ that the appellant have forfeited the ri(ht court belo$ that theappellants have forfeited the ri(ht to co#pel Baite to $ait for the sale of the ore before receivin(pa"#ent of the balance of P82,., because of their failure to rene$ the bond of the 1ar :asternSuret" 6o#pan" or else replace it $ith an euivalent (uarantee. The e)piration of the bondin(

co#pan"Js underta/in( on Dece#ber , *+22 substantiall" reduced the securit" of the vendorJsri(hts as creditor for the unpaid P82,., a securit" that Baite considered essential and upon$hich he had insisted $hen he e)ecuted the deed of sale of the ore to 1onacier E:)hibit hen he does not furnish to the creditor the (uaranties or securities $hich he haspro#ised.

E7F >hen b" his o$n acts he has i#paired said (uaranties or securities after theirestablish#ent, and $hen throu(h fortuitous event the" disappear, unless he i##ediatel"(ives ne$ ones euall" satisfactor".

0ppellantsJ failure to rene$ or e)tend the suret" co#pan"Js bond upon its e)piration plainl" i#pairedthe securities (iven to the creditor Eappellee BaiteF, unless i##ediatel" rene$ed or replaced.

There is no #erit in appellantsJ ar(u#ent that BaiteJs acceptance of the suret" co#pan"Js bond $ithfull /no$led(e that on its face it $ould auto#aticall" e)pire $ithin one "ear $as a $aiver of itsrene$al after the e)piration date. No such $aiver could have been intended, for Baite stood to loseand had nothin( to (ain barel" and if there $as an", it could be rationall" e)plained onl" if theappellants had a(reed to sell the ore and pa" Baite before the suret" co#pan"Js bond e)pired onDece#ber , *+22. 4ut in the latter case the defendants&appellantsJ obli(ation to pa" beca#eabsolute after one "ear fro# the transfer of the ore to 1onacier b" virtue of the deed :)hibit


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6o#in( no$ to the second issue in this appeal, $hich is $hether there $ere reall" -9, tons ofiron ore in the stoc/piles sold b" appellee Baite to appellant 1onacier, and $hether, if there hadbeen a short&deliver" as clai#ed b" appellants, the" are entitled to the pa"#ent of da#a(es, $e#ust, at the outset, stress t$o thin(s! first, that this is a case of a sale of a specific #ass of fun(ible(oods for a sin(le price or a lu#p su#, the uantit" of


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:ven (rantin(, then, that the esti#ate of 8,8+ cubic #eters of ore in the stoc/piles #ade b"appellantJs $itness 6ipriano Manla5(it is correct, if $e #ultipl" it b" the avera(e tonna(e factor of7.7 tons to a cubic #eter, the product is -*,+. tons, $hich is not ver" far fro# the esti#ate of-9, tons #ade b" appellee Baite, considerin( that actual $ei(hin( of each unit of the #ass $aspracticall" i#possible, so that a reasonable percenta(e of error should be allo$ed an"one #a/in(an esti#ate of the e)act uantit" in tons found in the #ass. It #ust not be for(otten that the contract

:)hibit


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)ELLOILLO,J.*

A litigation i not i!pl" a contet o# litigant $e#ore the $ar o# pu$lic opinion% !ore than

that& it i a puruit o# jutice through legal and e'uita$le !ean( To pre)ent the earch #or jutice#ro! e)ol)ing into a co!petition #or pu$lic appro)al& ociet" in)et the judiciar" with co!plete

independence there$" inulating it #ro! de!and e*preed through an" !ediu!& the pre note*cluded( Thu& i# the court would !erel" re#lect& and wore& uccu!$ to the great preure o#

the da"& the end reult& it i #eared& would $e a tra)et" o# jutice(

In the earl" i*tie& petitioner National De)elop!ent Corporation +NDC,& a go)ern!ent

owned and controlled corporation created under CA ./ a a!ended $" CA 0 and PD No( 11.&

had in it dipoal a ten +2,-hectare propert" located along Pure3a St(& Sta( 4ea& 4anila( Theetate wa popularl" 5nown a the NDC co!pound and co)ered $" Tran#er Certi#icate o# Title

No( 6/..7& 202 and 87892(

So!eti!e in 4a" 617 pri)ate repondent Firetone Cera!ic Inc( +FI:ESTONE,

!ani#eted it deire to leae a portion o# the propert" #or it cera!ic !anu#acturing $uine( On/8 Augut 617 NDC and FI:ESTONE entered into a contract o# leae deno!inated a Contract

No( C-02-17 co)ering a portion o# the propert" !eaured at /(62. hectare #or ue a a

!anu#acturing plant #or a ter! o# ten +2, "ear& renewa$le #or another ten +2, "ear under thea!e ter! and condition(;


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through e)eral letter and telephone call that it wa renewing it leae o)er the propert"( Bhile

it letter o# 9 4arch 6.. wa anwered $" Antonio A( enon& eneral 4anager o# NDC& who

pro!ied i!!ediate action on the !atter& the ret o# it co!!unication re!ainedunac5nowledged(;9ul" 6.. addreed to 4r( >a5e C( Lagonera& Director and Special Aitant toE*ecuti)e Secretar" Catalino 4acaraeg& re)iewing a propoed !e!orandu! order u$!itted to

then Preident Cora3on C( A'uino tran#erring the whole NDC co!pound& including the leaed

propert"& in #a)or o# petitioner PP(Attached to the letter wa a dra#t o# the propoed

!e!orandu! order a well a a u!!ar" o# e*iting leae on the u$ject propert"( The ur)e"lited FI:ESTONE a leee o# a portion o# the propert"& placed at /6&222 ;2


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and )iolated it e*iting leae $" increaing the rental rate at P/22&222(22 a !onth while

de!anding that it )acated the pre!ie i!!ediatel"(;8


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214 to e*cue or hield it #ro! it contractual o$ligation to FI:ESTONE( There i nothing

therein that allow NDC to dia)ow or repudiate the ole!n engage!ent that it #reel" and

)oluntaril" undertoo5& or agreed to underta5e(@;/

sales set 2 cases

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