1. ALI AKANG vs.

MUNICIPALITY OF of the condition agreed upon, that is, full payment of

ISULAN, SULTAN KUDARAT PROVINCE the purchase price.
In a contract of sale, the title to the property passes
FACTS: to the buyer upon the delivery of the thing sold,
Ali Akang (petitioner) is a member of the whereas in a contract to sell, the ownership is, by
national and cultural community belonging to the agreement, retained by the seller and is not to pass
Maguindanaon tribe of Isulan, Province of Sultan to the vendee until full payment of the purchase
Kudarat and the registered owner of parcel of land price.
located at Isulan, Sultan Kudarat, with an area of The Deed of Sale executed by the petitioner and the
20,030 square meters. respondent is a perfected contract of sale, all its
Sometime in 1962, a two-hectare portion of the elements being present. There was mutual
property was sold by the petitioner to the agreement between them to enter into the sale, as
Municipality of Isulan, Province of Sultan Kudarat shown by their free and voluntary signing of the
(respondent) through then Isulan Mayor Datu contract. There was also an absolute transfer of
Ampatuan under a Deed of Sale executed on July ownership of the property by the petitioner to the
18, 1962 for P3,000 to be used purposely and respondent as shown in the stipulation: "x x x I
exclusively as a Government Center site. The petitioner hereby sell, transfer, cede, convey and
respondent immediately took possession of the assign as by these presents do have sold,
property and began construction of the municipal transferred, ceded, conveyed and assigned, x x x."
building. There was also a determine subject matter, that is,
Thirty-nine (39) years later or on October 26, 2001, the two-hectare parcel of land as described in the
the petitioner, together with his wife, Patao Deed of Sale. Lastly, the price or consideration is at
Talipasan, filed a civil action for Recovery of Three Thousand Pesos (P3,000.00), which was to
Possession of Subject Property and/or Quieting of be paid after the execution of the contract. The fact
Title thereon and Damages against the respondent, that no express reservation of ownership or title to
represented by its Municipal Mayor, et al. the property can be found in the Deed of Sale
In his complaint, the petitioner alleged, among bolsters the absence of such intent, and the
others, that the agreement was one to sell, which contract, therefore, could not be one to sell. Had the
was not consummated as the purchase price was intention of the petitioner been otherwise, he could
not paid. have: (1) immediately sought judicial recourse to
In its answer, the respondent denied the petitioner’s prevent further construction of the municipal
allegations, claiming, among others: that the building; or (2) taken legal action to contest the
petitioner’s cause of action was already barred by agreement. The petitioner did not opt to undertake
laches; that the Deed of Sale was valid; and that it any of such recourses.
has been in open, continuous and exclusive The petitioner’s allegation of non-payment is of no
possession of the property for forty (40) years. consequence taking into account the Municipal
Voucher presented before the RTC, which proves
ISSUE: payment by the respondent of Three Thousand
1. Whether the Deed of Sale is a valid and Pesos (P3,000.00). The petitioner, notwithstanding
perfected contract of sale; the lack of the Municipal Treasurer’s approval,
admitted that the signature appearing on the
HELD: Municipal Voucher was his and he is now estopped
Yes. The Deed of Sale is a Valid Contract of Sale. from disclaiming payment.
By the contract of sale, one of the contracting Even assuming, arguendo, that the petitioner was
parties obligates himself to transfer the ownership of not paid, such non payment is immaterial and has
and to deliver a determinate thing, and the other to no effect on the validity of the contract of sale. A
pay therefore a price certain in money or its contract of sale is a consensual contract and what is
equivalent.The elements of a contract of sale are: required is the meeting of the minds on the object
(a) consent or meeting of the minds, that is, consent and the price for its perfection and validity. In this
to transfer ownership in exchange for the price; (b) case, the contract was perfected the moment the
determinate subject matter; and (c) price certain in petitioner and the respondent agreed on the object
money or its equivalent. of the sale – the two-hectare parcel of land, and the
A contract to sell, on the other hand, is a bilateral price – Three Thousand Pesos (P3,000.00). Non-
contract whereby the prospective seller, while payment of the purchase price merely gave rise to a
expressly reserving the ownership of the subject right in favor of the petitioner to either demand
property despite delivery thereof to the prospective specific performance or rescission of the contract of
buyer, binds himself to sell the said property sale.
exclusively to the prospective buyer upon fulfillment The Petitioner’s Claim for Recovery of Possession
and Ownership is Barred by Laches. Laches has
been defined as the failure or neglect, for an
unreasonable and unexplained length of time, to do
that which, by exercising due diligence could or
should have been done earlier. It should be
stressed that laches is not concerned only with the
mere lapse of time. 1. ALMIRA V. COURT OF APPEALS
As a general rule, an action to recover registered
land covered by the Torrens System may not be FACTS:
barred by laches.Neither can laches be set up to Petitioners are the wife and the children of
resist the enforcement of an imprescriptible legal the late Julio Garcia who inherited from his mother,
right. In exceptional cases, however, the Court Ma. Alibudbud, a portion of a 90,655 square meter
allowed laches as a bar to recover a titled property. property denominated as lot 1642 of the Sta. Rosa
Thus, in Romero v. Natividad, the Court ruled that Estate in Brgy. Caingin Sta. Rosa Laguna. The lot
laches will bar recovery of the property even if the was co-owned and registered in the names of three
mode of transfer was invalid. persons with the following shares: Vicente de
More particularly, laches will bar recovery of a Guzman (1/2), Enrique Hemedes (1/4) and
property, even if the mode of transfer used by an Francisco Alibudbud, the father of Ma. Alibudbud
alleged member of a cultural minority lacks (1/4). Although there wad no separate title in the
executive approval. Thus, in Heirs of Dicman v. name of Julio Garcia, there were tax declaration in
Cariño, the Court upheld the Deed of Conveyance his name to the intent of his grandfather’s share
of Part Rights and Interests in Agricultural Land covering the area of 21460 square meter.
executed by Ting-el Dicman in favor of Sioco Cariño
despite lack of executive approval. The Court stated On July 5, 1984, petitioner as heirs of Julio
that "despite the judicial pronouncement that the Garcia, and respondent Federico Brines entered a
sale of real property by illiterate ethnic minorities is Kasunduan ng Pagbibilihan (Kasunduan for Brevity)
null and void for lack of approval of competent over the 21460 square meter portion for the sum of
authorities, the right to recover possession has P150.000.00. Respondent paid P65, 000.00 upon
nonetheless been barred through the operation of execution of the contract while the balance of P85,
the equitable doctrine of laches." Similarly in this 000.00 was made payable within six (6) months
case, while the respondent may not be considered from the date of the execution of the instrument.
as having acquired ownership by virtue of its long The time of the execution of the kasunduan,
and continued possession, nevertheless, the petitioners allegedly informed respondent that TCT
petitioner’s right to recover has been converted into No. RT-1076 was in the possession of their cousin,
a stale demand due to the respondent’s long period Conchila Alibudbud, who having bought Vicente de
of possession and by the petitioner’s own inaction Guzman’s ½ shares, owned the bigger portion of lot
and neglect. The Court cannot accept the 1642. This standing notwithstanding, respondent
petitioner’s explanation that his delayed filing and willingly entered into the Kasunduan provided that
assertion of rights was due to Martial Law and the the full payment of the purchase price will be made
Cotabato Ilaga-Black Shirt Troubles. The Martial upon delivery to him of the title.
Law regime was from 1972 to 1986, while the Ilaga-
Black Shirt Troubles were from the 1970s to the Respondent took possession of the property
1980s. The petitioner could have sought judicial subject of the Kasunduan and made various
relief, or at the very least made his demands to the payments to petitioners amounting to P58500.00.
respondent, as early as the third quarter of 1962 However upon failure of petitionere to deliver to him
after the execution of the Deed of Sale and before a separate title to the property in the name of Julio
the advent of these events. Moreover, even if, as Garcia he refused to make further payments,
the petitioner claims, access to courts were prompting petitioner to file a civil action before the
restricted during these times, he could have RTC for a rescission of the Kasunduan, return by
immediately filed his claim after Martial Law and respondent to petitioner of the possession of the
after the Cotabato conflict has ended. The subject parcel of land, and payment by respondent
petitioner's reliance on the Court's treatment of of damages in favour of petitioners.
Martial Law as force majeure that suspended the
running of prescription in Development Bank of the
Philippines v. Pundogar is inapplicable because the ISSUE:
Court's ruling therein pertained to prescription and Whether or not the petitioner may rescind
not laches. Consequently, the petitioner's lengthy the Kasunduan pursuant to Article 1191 of the Civil
inaction sufficiently warrants the conclusion that he Code for the failure of respondent to give full
acquiesced or conformed to the sale. payment of the balance of the purchase price.
Ruling:
NO, the right of the parties are governed by Issue:
the terms ands the nature of the contract they Whether or not the transaction is one of
entered. Hence, although the nature of the contract of sale.
Kasunduan was never places in dispute by both
parties, it is necessary to ascertain whether the Held:
Kasunduan is a contract to sell or a contract of Sale. No. What transpired between the parties
Although both parties have consistency referred to was a contract to sell. The provision of the contract
the Kasunduan as a contract to Sell, a careful characterizes the agreement between the parties as
reading of the provision of the Kasunduan reveals a contract to sell, not a contract of sale. Ownership
that it is a contract of Sale. A deed of sale is is retained by the vendors, the Portics; it will not be
absolute in nature in the absence of an any passed to the vendee, the Cristobals, until the full
stipulation reserving title to the vendor until full payment of the purchase price. Such payment is a
payment of the purchase price. The delivery of a positive suspensive condition, and failure to comply
separation title in the name of Julio Garcia was a with it is not a breach of obligation; it is merely an
condition imposed on respondent’s obligation to pay event that prevents the effectivity of the obligation of
the balance of the purchase price. It was not a the vendor to convey the title. In short, until the full
condition imposed in the perfection of the contract price is paid, the vendor retains ownership.
of Sale. The mere issuance of the Certificate of Title in favor
of Cristobal did not vest ownership in her. Neither
The rescission will not prosper since the did it validate the alleged absolute purchase of the
power to rescind is only given to the injured party. lot. Registration does not vest, but merely serves
The injured party is the party who has faithfully as evidence of, title. Our land registration laws do
fulfilled his obligation. In the case at bar, the not give the holders any better title than that which
petitioners were not ready, willing and able to they actually have prior to registration.
comply with their obligation to deliver a separate Under Article 1544 of the Civil Code, mere
title in the name of Julio Garcia to respondent registration is not enough to acquire a new title.
therefore, thy are not in a position to ask for Good faith must concur. Clearly, Cristobal has not
rescission. Failure to comply with a condition yet fully paid the purchase price. Hence, as long as
imposed on the performance of an obligation gives it remains unpaid, she cannot feign good faith. She
the other party the option either to refuse to proceed is also precluded from asserting ownership against
with the sale or to waive the condition under Art the Portics. The CA’s finding that she had a valid
1545 of the civil code. Hence it is the respondent title to the property must be set aside.
who has the option.

3. UNIVERSAL ROBINA SUGAR MILLING

2. SPOUSES RICARDO AND FERMA CORPORATION V. HEIRS OF ANGEL
PORTIC VS ANASTACIA CRISTOBAL TEVES

In 1968, spouses Ricardo and Ferma Portic Facts:

acquired a parcel of land with a 3 door apartment Andres Abanto owned two parcels of land
from spouses Alcantara even though they’re aware situated in Campuyo, Manjuyod, Negros Oriental.
that the land was mortgaged to the SSS. Portic One lot is registered in his name and the other lot is
defaulted in paying SSS. The Portics then executed unregistered. When he died, his heirs executed an
a contract with Anastacia Cristobal and the latter "Extrajudicial Settlement of the Estate of the
agreed to buy the said property for P200k. Deceased and Simultaneous Sale." In this
Cristobal’s down payment was P45k and she also document, Abanto's heirs adjudicated unto
agreed to pay SSS. The contract between them themselves the two lots and sold the unregistered
states: That while the balance of P155,000.00 has lot to the United Planters Sugar Milling Company,
not yet been fully paid the FIRST PARTY OWNERS Inc. (UPSUMCO), and the registered lot to Angel M.
shall retain the ownership of the above described Teves, for a total sum of P115,000.00. The sale
parcel of land together with its improvements but was not registered.
the SECOND PARTY BUYER shall have the right to Out of respect for his uncle Montenegro,
collect the monthly rentals due on the first door (13- who was UPSUMCO's founder and president, Teves
A) of the said apartment. A transfer certificate was verbally allowed UPSUMCO to use the registered
executed in favor of Cristobal. Cristobal was not lot for pier and loading facilities, free of charge,
able to pay on the due date. A suit ensued to lift the subject to the condition that UPSUMCO shall
cloud on the title. shoulder the payment of real property taxes and
that its occupation shall be co-terminus with its the purchaser upon payment of P115,000.00. On
corporate existence. UPSUMCO then built a October 29, 1996, URSUMCO filed a motion for
guesthouse and pier facilities on the property. Years reconsideration but was denied by the Appellate
later, UPSUMCO’s properties were acquired by the Court. Hence, the instant petition for review on
Philippine National Bank (PNB). Later, PNB certiorari.
transferred the same properties to the Asset
Privatization Trust (APT) which, in turn, sold the Issue:
same to the Universal Robina Sugar Milling Whether or not there was a perfected
Corporation (URSUMCO). URSUMCO then took contract of sale.
possession of UPSUMCO’s properties, including
Teves' lot. Held:
Upon learning of the acquisition of his lot, Yes, the transaction is not merely a contract
Teves formally asked the corporation to turn over to to sell but a contract of sale. In a contract of sale,
him possession thereof or the corresponding title to the property passes to the vendee upon
rentals. He stated in his demand letters that he delivery of the thing sold; while in a contract to sell,
merely allowed UPSUMCO to use his property until ownership is, by agreement, reserved in the vendor
its corporate dissolution; and that it was not and is not to pass to the vendee until full payment of
mortgaged by UPSUMCO with the PNB and, the purchase price. In the case at bar, the subject
therefore, not included among the foreclosed contract, duly notarized, provides that the Abanto
properties acquired by URSUMCO. heirs sold to Teves the lot covered by TCT No. H-
URSUMCO refused to heed Teves' 37. There is no showing that the Abanto heirs
demand, claiming that it acquired the right to occupy merely promised to sell the said lot to Teves.
the property from UPSUMCO which purchased it The absolute ownership over the registered
from Andres Abanto; and that it was merely placed land was indeed transferred to Teves is further
in the name of Angel Teves, as shown by the "Deed shown by his acts subsequent to the execution of
of Transfer and Waiver of Rights and Possession" the contract. As found by the trial court, it was
dated November 26, 1987. Under this document, Teves, not Andres Abanto's heirs, who allowed
UPSUMCO transferred to URSUMCO its application UPSUMCO to construct pier facilities and
for agricultural and foreshore lease. The same guesthouse on the land. When the property was
document partly states that the lands subject of the erroneously included among UPSUMCO's
foreshore and agricultural lease applications are properties that were transferred to petitioner
bounded on the north by the "titled property of URSUMCO, it was Teves, not the heirs of Andres
Andres Abanto bought by the transferor Abanto, who informed petitioner that he owns the
(UPSUMCO) but placed in the name of Angel same and negotiated for an arrangement regarding
Teves". URSUMCO further claimed that it was its use. Teves even furnished petitioner documents
UPSUMCO, not Teves, which has been paying the and letters showing his ownership of the lot, such as
corresponding realty taxes. a copy of the "Extrajudicial Settlement of the Estate
Consequently, Teves filed a complaint for of the Deceased Andres Abanto and Simultaneous
recovery of possession of real property with Sale" and a certified true copy of TCT No. H-37
damages against URSUMCO. However, on covering the disputed lot. Indeed, the trial court and
September 4, 1992, Teves died and was substituted the Court of Appeals correctly ruled that Teves
by his heirs. On April 6, 1994, the RTC held that purchased the lot from the Abanto heirs.
URSUMCO has no personality to question the That the contract of sale was not registered
validity of the sale of the property between the heirs does not affect its validity. Being consensual in
of Andres Abanto and Angel Teves since it is not a nature, it is binding between the parties, the Abanto
party thereto; that Teves' failure to have the sale heirs and Teves. Article 1358 of the New Civil
registered with the Registry of Deeds would not Code, which requires the embodiment of certain
vitiate his right of ownership, unless a third party contracts in a public instrument, is only for
has acquired the land in good faith and for value convenience, and the registration of the instrument
and has registered the subsequent deed; that the would merely affect third persons. Formalities
list of properties acquired by URSUMCO from the intended for greater efficacy or convenience or to
PNB does not include the disputed lot and, bind third persons, if not done, would not adversely
therefore, was not among those conveyed by affect the validity or enforceability of the contract
UPSUMCO to URSUMCO. between the contracting parties themselves. Thus,
On appeal by URSUMCO, the Court of Appeals by virtue of the valid sale, Angel Teves stepped into
affirmed the RTC decision, holding that the the shoes of the heirs of Andres Abanto and
transaction between Angel Teves and Andres acquired all their rights to the property.
Abanto's heirs is a contract of sale, not one to sell,
because ownership was immediately conveyed to
 appellant, however, argues (Errors I-IV; VI; VIII) that
4. MANUEL v. RODRIGUEZ the Payatas Subdivision had no right to cancel the
contract, as there was no demand by suit or notarial
Facts: act, as provided by Article 1504 of the Old Code
Januara Rodriguez ceded and transferred (Art. 1592, N. C. C.). This is without merit, because
the land owned by her to the Payatas Subdivision Article 1504 requiring demand by suit or notarial act
Inc., to be administered by said firm, subdivided, in case the vendor of realty wants to rescind, does
sold, leased or otherwise disposed of. Defendant- not apply to a contract to sell or promise to sell,
appellee Eulogio Rodriguez was then the Secretary- where title remains with the vendor until fulfillment
Treasurer of said Payatas Subdivision Inc. to a positive suspensive condition, such as full
Plaintiff-appellant offered to buy the lot in payment of the price.
question. Plaintiff-appellant made a counter-offer for In contracts to sell, where ownership is
P2,000. Plaintiff-appellant wanted to pay in retained by the seller and is not to pass until the full
installments. Plaintiff-appellant then requested that payment of the price, such payment, as we said, is
the down-payment be reduced to P1,300. a positive suspensive condition, the failure of which
After making the initial payment of P1,300, is not a breach, casual or serious, but simply an
a provisional receipt was issued. Plaintiff-appellant event that prevented the obligation of the vendor to
was placed in the possession of the lot. It appears convey title from acquiring binding force, in
that plaintiff-appellant did not make any payments accordance with Article 1117 of the Old Civil Code.
within the 9 to 10-month period. Payatas To argue that there was only a casual breach is to
Subdivision Inc. sent him a letter urging immediate proceed from the assumption that the contract is
payment of his unpaid account with the Company. one of absolute sale, where non-payment is a
Defendants-appellees considered his contract resolutory condition, which is not the case.
cancelled and extinguished, and the amounts
already paid (P1,600), forfeited to the Company, the
transaction being merely a contract to sell or
promise to sell. 5. ALBERT PADILLA v. SPOUSES
Januaria Rodriguez, who was the aunt of PAREDES and COURT OF APPEALS
defendant-appellee Eulogio Rodriguez, sold several
properties to the latter, including Lot 51 in question, Facts:
in consideration of the monthly advances, support, On October 20, 1988, petitioner Padilla and
services, care, maintenance, medical expenses, private respondent entered into a contract to sell
etc. which she received from the said Eulogio involving a parcel of land. The was untitled but
Rodriguez. TCT was issued to Eulogio Rodriguez, private respondent was paying taxes thereon.
Sr. Under the contract, petitioner undertook to secure
Eulogio Rodriguez, Sr. then sold Lot 51to John title to the property in private respondent’s names of
Landah. Plaintiff-appellant wanted compel the the P312,840 purchase prize, petitioner was to pay
execution of a formal deed of conveyance in his downpayment of P50,000 upon signing and the
favor covering the purported sale. balance was to be paid within 10 days from the
issuance of the court order directing issuance of the
Issue: decree of registration. For failure to pay some of the
Whether or not the transaction was contract amount, respondent offered to sell to petitioner one-
to sell. half of the property for all the payment, lest
respondent rescinds the contract. Petitioner refused
Held: and instituted action for specific performance
Yes. One evidence of the true character of alleging that they have substantially complied with
the transaction is the statement contained in Exhibit the obligation. RTC ruled for the petitioners stating a
"J": "at ng kayo naman ay mabigyan na ng casual or slight breach that did not warrant
katibayan, alinsunod sa pinagkayarian", rescission. CA reversed the decision and confirmed
strengthening the conclusion that what transpired the respondent’s rescission.
was a mere contract to sell, transfer of title being
conditioned on full payment of the price. Issue:
Although this dissolution of Payatas Whether or not the private respondents are
Subdivision Inc. cannot be determinative of the entitled to rescind the contract to sell the land to
character of the sale in 1926 (as to whether petitioner
conditional or absolute), it must really have been the Held:
occasion which prompted the termination of the The Supreme Court sustained the ruling of
contract, as the corporation had to wind up its CA that private respondent may validly rescind the
affairs and close all pending business. Plaintiff- contract to sell, however, the reason for this is not
that respondents have the power to rescind but executed between petitioner Adelfa Properties, Inc.
because their obligation thereunder did not arise. and private respondents Rosario Jimenez-
The CA is correct in ordering the return to petitioner Castañeda and Salud Jimenez is an option contract
of the amounts received from him by private which is contact to sell.
respondents, on the precept that no one shall be
unjustly enriched himself at the expense of another. Held:
Yes. The alleged option contract as a contract to
sell, rather than a contract of sale. The distinction
6. ADELFA PROPERTIES INC. v. CA between the two is important for in contract of sale,
the title passes to the vendee upon the delivery of
Facts: the thing sold; whereas in a contract to sell, by
Herein private respondents and their agreement the ownership is reserved in the vendor
brothers, Jose and Dominador Jimenez, were the and is not to pass until the full payment of the price.
registered co-owners of a parcel of land situated in In a contract of sale, the vendor has lost and cannot
Barrio Culasi, Las Piñas, Metro Manila. recover ownership until and unless the contract is
Jose and Dominador Jimenez sold their resolved or rescinded; whereas in a contract to sell,
share consisting of one-half of said parcel of land to title is retained by the vendor until the full payment
herein petitioner pursuant to a "Kasulatan sa Bilihan of the price, such payment being a positive
ng Lupa”. Petitioner expressed interest in buying the suspensive condition and failure of which is not a
western portion of the property from private breach but an event that prevents the obligation of
respondents. Accordingly, on November 25, 1989, the vendor to convey title from becoming effective.
an "Exclusive Option to Purchase" 5 was executed Thus, a deed of sale is considered absolute in
between petitioner and private respondents. Before nature where there is neither a stipulation in the
petitioner could make payment, it received deed that title to the property sold is reserved in the
summons. The nephews and nieces of private seller until the full payment of the price, nor one
respondents against the latter, Jose and Dominador giving the vendor the right to unilaterally resolve the
Jimenez, and herein petitioner filed for annulment of contract the moment the buyer fails to pay within a
the deed of sale in favor of Household Corporation fixed period. The parties never intended to transfer
and recovery of ownership of the property. ownership to Adelfa Properties to completion of
As a consequence, petitioner informed payment of the purchase price, this is inferred by
private respondents that it would hold payment of the fact that the exclusive option to purchase,
the full purchase price and suggested that private although it provided for automatic rescission of the
respondents settle the case with their nephews and contract and partial forfeiture of the amount already
nieces. Respondent Salud Jimenez refused to heed paid in case of default, does not mention that Adelfa
the suggestion of petitioner and attributed the Properties is obliged to return possession or
suspension of payment of the purchase price to ownership of the property as a consequence of non-
"lack of word of honor." Private-respondents payment. There is no stipulation anent reversion or
informed Atty. Bernardo, petitioner's counsel, that reconveyance of the property in the event that
they were cancelling the transaction. Despite Atty. petitioner does not comply with its obligation. With
Bernardo's offers to pay the purchase price, private- the absence of such a stipulation, it may legally be
respondents rejected his offers. Private respondents inferred that there was an implied agreement that
executed a Deed of Conditional Sale 10 in favor of ownership shall not pass to the purchaser until he
Emylene Chua over the same parcel of land. Private had fully paid the price.
respondents' counsel sent a letter to petitioner The validity of the suspension of payment
enclosing therein a check for P25,000.00 notwithstanding, we find and hold that private
representing the refund of fifty percent of the option respondents may no longer be compelled to sell
money paid under the exclusive option to purchase. and deliver the subject property to petitioner for two
Private respondents then requested petitioner to reasons, that is, petitioner's failure to duly effect the
return the owner's duplicate copy of the certificate of consignation of the purchase price after the
title of respondent Salud Jimenez. Petitioner failed disturbance had ceased; and, secondarily, the fact
to surrender the certificate of title, hence private that the contract to sell had been validly rescinded
respondents filed a case for annulment of contract by private respondents. The mere sending of a
with damages, praying, among others, that the letter by the vendee expressing the intention to pay,
exclusive option to purchase be declared null and without the accompanying payment, is not
void; that defendant, herein petitioner, be ordered to considered a valid tender of payment. Besides, a
return the owner's duplicate certificate of title. mere tender of payment is not sufficient to compel
private respondents to deliver the property and
Issue: execute the deed of absolute sale. It is consignation
Whether or not the "Exclusive Option to Purchase" which is essential in order to extinguish petitioner's
obligation to pay the balance of the purchase price. execution of the contract without any reservation of
In the case at bar, it has been shown that although title on the part of the BABASAS while actual
petitioner was duly furnished and did receive a delivery was made when TABANGAO took
written notice of rescission which specified the unconditional possession of the lots and leased
grounds therefore, it failed to reply thereto or protest them to its associate company SHELL which
against it. Its silence thereon suggests an admission constructed its multi-million peso LPG Project
of the veracity and validity of private respondents' thereon.
claim.

8. TOMAS K. CHUA vs. COURT OF

7. BABASA VS. CA APPEALS and ENCARNACION VALDES-
CHOY
Facts:
Conditional Sale of Registered Lands was Facts:
executed between the parties over three (3) parcels Encarnacion Valdes-Choy advertised for
of land sale her paraphernal house and lot in Makati. They
Since the certificates of title over the lots were in the agreed on a purchase price of P10,800,000.00.
name of third persons, it was agreed that the total Chua gave P100,000 to Valdes-Choy as earnest
purchase price would be paid in the following money They agreed that the balance is payable on
manner upon signing of the contract, and upon or before 15 July 1989. Failure to pay balance on or
presentation by the BABASAS of transfer before the said date forfeits the earnest money.
certificates of titles in their name within twenty (20) On July 13, 1989, Valdes-Choy as vendor and
months from the signing of the contract. Chua as vendee signed two Deeds of Absolute
TABANGAO leased the lots to Shell Gas Sale. The first Deed of Sale covered the house and
Philippines, Inc. (SHELL. Two days prior to the lot for the purchase price of P8,000,000.00. The
expiration of the 20-month period, the BABASAS second Deed of Sale covered the furnishings,
asked TABANGAO for an indefinite extension within fixtures and
which to deliver clean titles over the lots. BABASAS movable properties contained in the house for the p
executed a notarized unilateral rescission to which urchase price of P2,800,000.00. The parties also
TABANGAO responded by reminding the BABASAS computed the capital gains tax to amount to
that they were the ones who did not comply with P485,000.00.
their contractual obligation to deliver clean titles The next day, Valdes-Choy deposited
within the stipulated 20-month period, hence, had the P485,000.00 manager's check to her
no right to rescind their contract. The BABASAS account and check to the counsel who undertook
insisted on the unilateral rescission to pay the capitalgains tax. Chua showed to Valdes-
Choy a PBCom manager's check for
Issue: P10,215,000.00 representing the balance of the
Whether or not the transaction is absolute contract purchase price. Chua, however, did not give this
of sale. PBCom manager's check to Valdes-Choy because
the TCT was still registered in the name of Valdes-
Held: Choy. Chua required that the Property be registered
Yes. Although denominated "Conditional Sale of first in his name before he would turn over the
Registered Lands," the contract between petitioners check to Valdes-Choy. This angered Valdes-Choy
and respondent TABANGAO is one of absolute who tore up the Deeds of Sale, claiming that
sale. Aside from the terms and stipulations used what Chua required was not part of their agreement.
therein indicating such kind of sale, there is Valdes-Choy demanded the payment of the
absolutely no proviso reserving title in the remaining purchase balance be first deposited in
BABASAS until full payment of the purchase price, her account before she transfers the title of the
nor any stipulation giving them the right to property to him.
unilaterally rescind the contract in case of non- Chua filed a complaint for specific
payment. A deed of sale is absolute in nature performance against Valdes-Choy.
although denominated a "conditional sale" absent
such stipulations.In such cases, ownership of the Issue:
thing sold passes to the vendee upon the Whether or not the transaction is contract to sell.
constructive or actual delivery thereof. In the instant
case, the subject properties passed to TABANGAO Held:
both by constructive and actual delivery. Yes. It is contract to sell as evidenced by the
Constructive delivery was accomplished upon the
Receipt. The signed Deeds of Sale also stipulated and not an absolute sale; that the same is subject to
that the buyer shall pay the balance of the purchase two (2) positive suspensive conditions, namely: the
price upon signing of the deeds. However, on the payment of the balance of P4,000 on or before
agreed date, Chua refused to pay the balance of the September 15, 1965 and the immediate assumption
purchase price as required by the contract to sell, of the mortgage of P12,000 with the First Insular
the signed Deeds of Sale, and Article 1582 of the Bank of Cebu. It is further contended that in said
Civil Code. Chua was therefore in default and has contract, title or ownership over the property was
only himself to blame for the rescission by Valdes- expressly reserved in the vendor, the Dignos
Choy of the contract to sell. Since the agreement spouses, until the suspensive condition of full and
between Valdes-Choy and Chua is a mere contract punctual payment of the balance of the purchase
to sell, the full payment of the purchase price price shall have been met.The issues presented are
partakes of a suspensive condition. The non- (1) whether or not the contract is a deed of absolute
fulfillment of the condition prevents the obligation to sale or a contract to sell, and (2) whether or
sell from arising and ownership is retained by the not there was a valid rescission thereof
seller without further remedies by the buyer. Article
1592 of the Civil Code permits the buyer to pay, Issue:
even after the expiration of the period, as long as no Whether or not there is a perfected contract of sale.
demand for rescission of the contract has been
made upon him either judicially or by notarial act. Held:
However, Article 1592 does not apply to a contract Yes. A careful examination of the contract shows
to sell where the seller reserves the ownership until that there is no such stipulation reserving the title of
full payment of the price. the property on the vendors nor does it give them
the right to unilaterally rescind the contract upon
non-payment of the balance thereof within a fixed
period. The Supreme Court affirmed the Decision of
9. Dignos vs. Court of Appeals, and Jabil the Court of Appeals saying stated that all the
elements of a valid contract of sale are present in
Facts: the document and that the spouses Dignos had no
The Dignos spouses were owners of a parcel of right to sell the land in question because an actual
cadastral land known as Lot No. 3453. On June 7, delivery of its possession has already been made in
1965,they sold Lot No. 3453 to respondent Atilano favor of Jabil as early as March 1965. It was also
J. Jabil for P28,000 payable in two installments, with found that the spouses Dignos never notified Jabil
an assumption of indebtedness with the First Insular by notarial act that they were rescinding the
Bank of Cebu in the sum of P12,000.In November contract, and neither did they file a suit in court to
25, 1965, the Dignos spouses sold the same land in rescind the sale. There is no showing that Jabil
favor of the spouses Luciano and Jovita Cabigas, properly authorized a certain Cipriano Amistad to
who were then U.S. citizens, for the price of tell petitioners that he was already waiving his rights
P35,000. A deed of absolute sale was executed by to the land in question.
the Dignos spouses in favor of the Cabigas
spouses, and which was registered in the Office of
the Register of Deeds pursuant to the provisions of
Act No. 3344. As the Dignos spouses refused to 10. Topacio vs Court of Appeals
accept from Atilano J. Jabil the balance of the
purchase price of the land, and with the discovery Facts:
of the second sale to the Cabigas spouses, Atilano The spouses De Villa (parents-in-law of
J. Jabil brought suit against the Digos spouses. The Topacio) were the former owners of a lot inQC. It
trial court declared the deed of sale executed was previously mortgaged to Ayala Investment and
in favor of the Cabigas spouses null and void and Development Corp to secure an obligation of
ordered Jabil to pay the remaining balance on P500k. For failure to pay, the mortgage was
the purchase price. The Digos spouses were foreclosed and consequently, BPI acquired the
ordered toreturn the sum of P 35,000 they received property as highest bidder. Topacio wanted to buy
from the Cabigas spouses. The Court of Appeals the property. He made an offer for P900k, but was
affirmed the decision of the lower court except as to asked toimprove it. Together, they arrived at P1.25M
the portion ordering Jabil to pay for the expenses as the purchase price, with 30%downpayment and
incurred by the Cabigas spouses for the building of the balance payable in cash upon execution of the
a fence upon the land. Hence, the present petition. Deed of Sale. Topacio paid the initial payment of
Petitioners (Spouses Dignos) contend that the Deed P375k. BPI wrote to Topacio and informed him that
of Sale with Atilano Jabil was a mere contract to sell he had until January 4, 1986 to pay thebalance of
P875k. P. asked for extensions. BPI agreed
to extend up to June 30. Topacio was unable to
meet the deadline, so BPI wrote a letter to Topacio,
where BPI declared himself free to sell the property
to other buyers and that Topacio could claim his
initial payment of P375k. Topacio merely asked for
more extensions. While BPI kepttelling Topacio that
he could claim the P375k back (in the form of a
cashier’s check), Topacio declined. But BPI
mailed the check to him. The check remained
with Topacio, uncashed. BPI then told Topaciothat
the property would be sold for P1.6M instead, so
Topacioreminded him of the original agreement
(P1.25M), but BPI refused.

Issue:
Whether or not the transaction was perfected
contract of sale.

Held:
Yes. Art. 1475. The contract of sale is perfected at
the moment there is a meeting of the minds upon
the thing which is the object of the contract and
upon the price. From the moment, the parties may
reciprocally demand performance, subject to the
provisions of the law governing the form of
contracts. Based on the aforecited article, the
parties have agreed on the object of the contract
which is the house and lot land even before
November 27, 1985, (the date petitioner sent his
letter together with the 30% downpayment), the
parties have agreed on the price which is
P1,250,000.00. Nowhere in the transaction
indicates that BPI reserved its title property nor did it
provide for any automatic rescission in case of
default. So when petitioner failed to pay the balance
of P875,000.00 despite several extensions given by
private respondent, the latter could not validly
rescind the contract without complying with the
provision of Article 1592 or Article 1191 on notarial
or judicial rescission respectively. The ruling
in Taguba v. Vda. de Leon, 132 SCRA 722 applies
in the case at bar, to wit