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    Sales Cases FULL TEXT

    Week 1

    Dizon vs. CA 302 SCRA 288

    [G.R. No. 122544. January 28, 1999]

    REGINA P. DIZON, AMPARO D. BARTOOME, !IDEINA D. BAZA, E"TER ABAD DIZON an#

    JO"EP$ ANT$ON% DIZON, RA%M&ND A. DIZON, GERARD A. DIZON, an# JO"E A. DIZON,

    JR.,petitioners, vs.'O&RT O! APPEA" an# O(ERAND E)PRE"" INE", IN'., respondents.

    [G.R. No. 124*41. January 28, 1999]

    REGINA P. DIZON, AMPARO D. BARTOOME, !IDEINA D. BAZA, E"TER ABAD DIZON an#

    JO"EP$ ANT$ON% DIZON, RA%M&ND A. DIZON, GERARD A. DIZON, an# JO"E A. DIZON,

    JR.,petitioners, vs.'O&RT O! APPEA", $ON. MA)IMIANO '. A"&N'ION, an# O(ERAND

    E)PRE"" INE", IN'., respondents.

    SYNOPSIS

    In 1974, Overland Express Lines, Inc. entered into a Contract of Lease with Option to Bu with

    herein petitioners involvin! a land in "ue#on Cit. $he ter% of the lease was for one &1' ear, durin!which period, the lessee was !ranted an option to purchase the lot for (),***.** per s+uare %eter.$hereafter, the lease shall e on a per %onth asis with a %onthl rental of (),***.**. Later, for failure topa the increased rental of (-,***.** per %onth effective une 197/, herein petitioners filed an action fore0ect%ent to which the Corporation was ordered to vacate the leased pre%ises. $he Corporation,however, +uestioned the 0urisdiction of the Cit Court over the e0ect%ent case. use+uentl, theCorporation filed its own action for specific perfor%ance and fixin! the period for oli!ation. It sou!ht toco%pel the execution of a deed of sale pursuant to the option to purchase, and the receipt of the partialpa%ent it %ade and to fix the period to pa the alance thereof.

    (etitioners have estalished a ri!ht to evict private respondent fro% the su0ect pre%ises for non2pa%ent of rentals. In this re!ard, the then Cit Court had exclusive 0urisdiction over the e0ect%ent suit.$he filin! the Corporation of a suit with the 3$C for specific perfor%ance did not divest the Cit Court

    of its 0urisidiction over the e0ect%ent case $he decision of the Cit Court was affir%ed the Inter%ediateppellate Court and the upre%e Court. 5avin! failed to exercise the option to purchase within thestipulated one2ear period, private respondent Corporation cannot now enforce its option. n i%plied newlease on a %onthl asis does not ipso facto carr with it an i%plied revival of the option to purchase theleased pre%ises. $he ri!ht to exercise the option to purchase expired with the ter%ination of the ori!inalcontract of lease for one ear. $he private respondent delivered a chec6 of ()**,***.** to lice i#onwho alle!edl acted as a!ent of petitioners pursuant to the supposed authorit !iven petitioner aspaee thereof does not a%ount to a perfected contract of sale pursuant to the contract of lease withoption to u. $here was no valid consent the petitioners on the supposed sale entered into licei#on, as petitioners alle!ed a!ent, and private respondent.

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    SYLLABUS

    1. CIVIL LAW; SPECIAL CONTRACTS; LEASE; NON-PAYMENT OF RENTALS GIVES RIGHT TO EVICT, REGARDLESS OFTHE ACTION FOR SPECIFIC PERFORMANCE TO ENFORCE OPTION TO PURCHASE WHICH WAS ALSOINSTITUTED. (etitioners have estalished a ri!ht to evict private respondent fro% the su0ect pre%ises for non2pa%ent ofrentals. ince the rent was paid on a %onthl asis, the period of lease is considered to e fro% %onth to %onth inaccordance with rticle 1/-7 of the 8ew Civil Code. here the rentals are paid %onthl, the lease, even if veral %a edee%ed to e on a %onthl asis, expirin! at the end of ever %onth pursuant to rticle 1/-7, in relation to rticle 1/7) of the

    Civil Code. In such case, a de%and to vacate is not even necessar for 0udicial action after the expiration of ever %onth.hen private respondent failed to pa the increased rental, the petitioners had a cause of action to institute an e0ect%ent suita!ainst the for%er with the then Cit Court. In this re!ard, the Cit Court &now :$C' had exclusive 0urisdiction over thee0ect%ent suit. $he filin! private respondent of a suit with the 3e!ional $rial Court for specific perfor%ance to enforce theoption to purchase did not divest the then Cit Court of its 0urisdiction to ta6e co!ni#ance over the e0ect%ent case. Of note isthe fact that the decision of the Cit Court was affir%ed oth the Inter%ediate ppellate Court and this Court.

    2. ID.; ID.; ID.; FAILURE TO EXERCISE OPTION TO PURCHASE WITHIN THE STIPULATED PERIOD; EFFECT; CASE ATBAR. 5avin! failed to exercise the option to purchase within the stipulated one ear period, private respondent cannotenforce its option to purchase an%ore. :oreover, even assu%in! arguendo that the ri!ht to exercise the option still susistsat the ti%e private respondent tendered the a%ount, the suit for specific perfor%ance to enforce the option to purchase wasfiled %ore than ten &1*' ears after accrual of the cause of action as provided under rticle 1144 of the 8ew Civil Code. In thiscase, there was a contract of lease for one &1' ear with option to purchase. $he contract of lease expired without the privaterespondent, as lessee, purchasin! the propert ut re%ained in possession thereof. 5ence, there was an i%plicit renewal ofthe contract of lease on a %onthl asis. $he other ter%s of the ori!inal contract of lease which are revived in the i%plied newlease under rticle 1/7* of the 8ew Civil Code are onl those ter%s which are !er%ane to the lessees ri!ht of continueden0o%ent of the propert leased. $herefore, an i%plied new lease does not ipso factocarr with it an i%plied revival of

    private respondents option to purchase &as lessee thereof' the leased pre%ises. $he provision entitlin! the lessee the optionto purchase the leased pre%ises is not dee%ed incorporated in the i%pliedl renewed contract ecause it is alien to thepossession of the lessee. (rivate respondents ri!ht to exercise the option to purchase expired with the ter%ination of theori!inal contract of lease for one ear.

    3. ID.; ID.; CONTRACT OF SALE; WHEN PERFECTED. ;nder rticle 147< of the 8ew Civil Code, the contract of sale is perfectedat the %o%ent there is a %eetin! of %inds upon the thin! which is the o0ect of the contract and upon the price. =ro% that%o%ent, the parties %a reciprocall de%and perfor%ance, su0ect to the provisions of the law !overnin! the for% ofcontracts. $hus, the ele%ents of a contract of sale are consent, o0ect, and price in %one or its e+uivalent. It earsstressin! that the asence of an of these essential ele%ents ne!ates the existence of a perfected contract of sale. ale is aconsensual contract and he who alle!es it %ust show its existence co%petent proof.

    4. ID.; ID.; CONTRACT OF AGENCY; NOT APPRECIATED. $here was no valid consent the petitioners &as co2owners of theleased pre%ises' on the supposed sale entered into i#on, as petitioners alle!ed a!ent, and private respondent. $heasis for a!enc is representation and a person dealin! with an a!ent is put upon in+uir and %ust discover upon his peril theauthorit of the a!ent. s provided in rticle 1-/- of the 8ew Civil Code, there was no showin! that petitioners consented tothe act of i#on nor authori#ed her to act on their ehalf with re!ard to her transaction with private respondent. $he %ost

    prudent thin! private respondent should have done was to ascertain the extent of the authorit of i#on. Bein! ne!li!ent inthis re!ard, private respondent cannot see6 relief on the asis of a supposed a!enc.

    D E ' I " I O N

    MARTINEZ,J.+

    Two consolidated petitions were filed before us seeking to set aside and annul the decisions and resolutions of respondent

    Court of Appeals. What seemed to be a simple ejectment suit was juxtaposed with procedural intricacies which finally found its

    way to this Court.

    G. R. NO. 122544+

    On May !" #$%&" pri'ate respondent O'erland (xpress )ines" *nc. +lessee, entered into a Contract of )ease with Option to

    -uy with petitioners#/+lessors, in'ol'ing a #"%00.12 s3uare meter parcel of land situated at corner MacArthur 4ighway and

    5outh 646 5treet" 7iliman" 8ue9on City. The term of the lease was for one +#, year commencing from May #:" #$%& up to May#0" #$%0. 7uring this period" pri'ate respondent was granted an option to purchase for the amount of ;!"222.22 per s3uare

    meter. Thereafter" the lease shall be on a per month basis with a monthly rental of ;!"222.22.

    http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn1http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn1
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    o'ember #$1 at the monthly rental of ;1"222.22" less payments made" plus #B interest per annum from >o'ember #1" #$%:"the date of filing of the complaint" until fully paid" the sum of ;1"222.22 a month starting 7ecember #$1" until pri'ate

    respondent fully 'acates the premises" and to pay ;2"222.22 as and by way of attorneys fees.

    ;ri'ate respondent filed a certioraripetition praying for the issuance of a restraining order enjoining the enforcement ofsaid judgment and dismissal of the case for lack of jurisdiction of the City Court.

    On 5eptember :" #$1&" the then *ntermediate Appellate Court!/+now Court of Appeals, rendered a decision&/stating thatD

    6x x x" the alleged 3uestion of whether petitioner was granted an extension of the option to buy thepropertyE whether such option" if any" extended the lease or whether petitioner actually paid the

    alleged ;!22"222.22 to

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    to execute the deed of absolute sale of the property in 3uestion" free from any lien or encumbrance

    whatsoe'er" in fa'or of the plaintiff@appellant" and to deli'er to the latter the said deed of sale" as well as the

    owners duplicate of the certificate of title to said property upon payment of the balance of the purchase

    price by the plaintiff@appellant. The plaintiff@appellant is ordered to pay ;#"%22.22 per month from =une#$%:" plus :B interest per annum" until payment of the balance of the purchase price" as pre'iously agreed

    upon by the parties.

    5O OF7(F(7.6

    Gpon denial of the motion for partial reconsideration +Ci'il Case >o. 8@&00, by respondent Court of Appeals"#2/petitioners ele'ated the case viapetition for certiorari3uestioning the authority of Alice A. 7i9on as agent of petitioners inrecei'ing pri'ate respondents partial payment amounting to ;!22"222.22 pursuant to the Contract of )ease with Option to

    -uy. ;etitioners also assail the propriety of pri'ate respondents exercise of the option when it tendered the said amount on =une

    2" #$%0 which purportedly resulted in a perfected contract of sale.

    G. R. NO. 124*41+

    ;etitioners filed with respondent Court of Appeals a motion to remand the records of Ci'il Case >o. !1@$#00 +ejectment

    case, to the Metropolitan Trial Court +MTC," then City Court of 8ue9on City" -ranch !1" for execution of the judgment ##/dated

    >o'ember " #$1 which was granted in a resolution dated =une $" #$$. ;ri'ate respondent filed a motion to reconsider saidresolution which was denied.

    Aggrie'ed" pri'ate respondent filed a petition for certiorari" prohibition with preliminary injunction andor restraining

    order with this Court +H.F. >os. #2:%02@0#, which was dismissed in a resolution dated 5eptember #:" #$$ on the ground thatthe same was a refiled case pre'iously dismissed for lack of merit. On >o'ember :" #$$" entry of judgment was issued by this

    Court.

    On =uly #&" #$$!" petitioners filed an urgent ex-partemotion for execution of the decision in Ci'il Case >o. !1@$#00 withthe MTC of 8ue9on City" -ranch !1. On 5eptember #!" #$$!" the trial court ordered the issuance of a third alias writ of

    execution. *n denying pri'ate respondents motion for reconsideration" it ordered the immediate implementation of the third writ

    of execution without delay.

    On 7ecember " #$$!" pri'ate respondent filed with the Fegional Trial Court +FTC, of 8ue9on City" -ranch #2& a

    petition forcertiorari and prohibition with preliminary injunctionrestraining order +5;. ;FOC. >o. $!@#1%, challenging theenforceability and 'alidity of the MTC judgment as well as the order for its execution.

    On =anuary ##" #$$&" FTC of 8ue9on City" -ranch #2& issued an order#/granting the issuance of a writ of preliminary

    injunction upon pri'ate respondents posting of an injunction bond of ;02"222.22.

    Assailing the afore3uoted order after denial of their motion for partial reconsideration" petitioners filed apetition#!/for certiorariand prohibition with a prayer for a temporary restraining order andor preliminary injunction with the

    Court of Appeals. *n its decision" #&/the Court of Appeals dismissed the petition and ruled thatD

    6The a'owed purpose of this petition is to enjoin the public respondent from restraining theejectment of the pri'ate respondent. To grant the petition would be to allow the ejectment of the pri'ate

    respondent. We cannot do that now in 'iew of the decision of this Court in [email protected]. C? >os. 0#0!@

    0&. ;etitioners alleged right to eject pri'ate respondent has been demonstrated to be without basis in

    the said ci'il case. The petitioners ha'e been shown" after all" to ha'e no right to eject pri'ate

    respondents.

    W4(F(

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    6This court in its decision in [email protected]. C? >os. 0#0!@0& declared that the plaintiff@appellant +pri'ate

    respondent herein, ac3uired the rights of a 'endee in a contract of sale" in effect" recogni9ing the right of

    the pri'ate respondent to possess the subject premises. Considering said decision" we should not allow

    ejectmentE to do so would disturb thestatus quoof the parties since the petitioners are not in possession ofthe subject property. *t would be unfair and unjust to depri'e the pri'ate respondent of its possession of the

    subject property after its rights ha'e been established in a subse3uent ruling.

    W4(F(ew Ci'il Code/are only those terms which are germane to the lessees right of continued

    enjoyment of the property leased.!/Therefore" an implied new lease does not ipso factocarry with it any implied re'i'al of

    pri'ate respondents option to purchase +as lessee thereof, the leased premises. The pro'ision entitling the lessee the option topurchase the leased premises is not deemed incorporated in the impliedly renewed contract because it is alien to the possession of

    the lessee. ;ri'ate respondents right to exercise the option to purchase expired with the termination of the original contract of

    lease for one year. The rationale of this Court is thatD

    This is a reasonable construction of the pro'ision" which is based on the presumption that when the lessor allows the

    lessee to continue enjoying possession of the property for fifteen days after the expiration of the contract he is

    willing that such enjoyment shall be for the entire period corresponding to the rent which is customarily paid in thiscase up to the end of the month because the rent was paid monthly. >ecessarily" if the presumed will of the partiesrefers to the enjoyment of possession the presumption co'ers the other terms of the contract related to such

    possession" such as the amount of rental" the date when it must be paid" the care of the property" the responsibility

    for repairs" etc. -ut no such presumption may be indulged in with respect to special agreements which by nature are

    foreign to the right of occupancy or enjoyment inherent in a contract of lease.&/

    Tr#. There was no perfected contract of sale between petitioners and pri'ate respondent. ;ri'ate respondent argued that itdeli'ered the check of ;!22"222.22 to Alice A. 7i9on who acted as agent of petitioners pursuant to the supposed authority gi'en

    http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn17http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn18http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn18http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn19http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn19http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn19http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn20http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn21http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn22http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn22http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn23http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn23http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn23http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn24http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn17http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn18http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn19http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn20http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn21http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn22http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn23http://sc.judiciary.gov.ph/jurisprudence/1999/jan99/122544.htm#_edn24
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    by petitioner o. !!##! of the Court of Appeals are hereby F(?(F5(7 and 5(T A5*7(.

    )et the records of this case be remanded to the trial court for immediate execution of the judgment dated >o'ember "#$1 in Ci'il Case >o. ?***@$#00 of the then City Court +now Metropolitan Trial Court, of 8ue9on City" -ranch ?*** as

    affirmed in the decision dated 5eptember :" #$1& of the then *ntermediate Appellate Court +now Court of Appeals, and in the

    resolution dated =une #$" #$10 of this Court.

    4owe'er" petitioners are ordered to F(7 to pri'ate respondent the amount of ;!22"222.22 which they recei'ed

    through Alice A. 7i9on on =une 2" #$%0.

    "O ORDERED.

    Davide, Jr., C.J. (Chairman), Melo, apunan and!ardo, JJ., concur.

    #/The original petitioners were

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    %/;er =udge *gnacio ). 5al'ador.

    1/7ocketed as [email protected]. C? >o. 0#0!@0&" entitled 6O?(F)A>7 (I;F(55 )*>(5" *>C." ;laintiff@Appellant 's. " (T.A)." 7efendants@

    Appellees.6

    $/CA 7ecision +#ighth Division, dated March $" #$$&" penned by =ustice (ubulo H. ?er9ola" and concurred in by =ustice Ficardo =. o. !!##!" entitled 6AM;AFO 7*JO>" (T.A)." ;etitioners 's. 4O>. MAI*M*A>O C. A5G>C*O>" as FTC =udge of 8ue9on City"

    -ranch #2& and O?(F)A>7 (I;F(55 )*>(5" *>C." Fespondents.6

    #&/CA 7ecision +$hirteenth Division, dated 7ecember ##" #$$0" penned by =ustice (ubulo H. ?er9ola" and concurred in by =ustice =usto ;. Torres" =r." Chairman and

    =ustice Oswaldo 7. AgcaoiliE Annex 6A6 of ;etitionE"ollo" pp. &:@0!.

    >OT(D [email protected]. 5; >o. !!##! was transferred to the Thirteenth 7i'ision by 'irtue of the Fesolution from the

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    G.R. N!. 112212. M"#$% 2, 1&&'(

    GREGORIO FULE,petitioner, vs. COURT OF APPEALS, NINEVETCH CRU) "*+ UANBELARMINO,respondents.

    D E C I S I O N

    ROMERO, J.

    $his petition for review on certiorari+uestions the affir%ance the Court of ppeals of the decision >1?of the3e!ional $rial Court of an (alo Cit, Branch )*, dis%issin! the co%plaint that praed for the nullification of acontract of sale of a 1*2hectare propert in $ana, 3i#al in consideration of the a%ount of (4*,***.** and a @.< carate%erald2cut dia%ond &Civil Case 8o. (2@4

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    use+uentl, however, ne!otiations for the arter of the 0ewelr and the $ana propert ensued. r. Cru#re+uested herein private respondent tt. uan Belar%ino to chec6 the propert who, in turn, found out that no sale orarter was feasile ecause the one2ear period for rede%ption of the said propert had not et expired at the ti%e.

    In an effort to cut throu!h an le!al i%pedi%ent, petitioner executed on Octoer 19, 19-4, a deed of rede%ptionon ehalf of =r. acoe purportedl in the a%ount of (1

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    fter trial, the lower court rendered its decision on :arch 7, 19-9. Confrontin! the issue of whether or not the!enuine pair of earrin!s used as consideration for the sale was delivered r. Cru# to petitioner, the lower courtsaidA

    $he Court finds that the answer is definitel in the affir%ative. Indeed, ra. Cru# delivered &the' su0ect 0ewelries &sic'into the hands of plaintiff who even raised the sa%e nearer to the li!hts of the lo of the an6 near the door. henas6ed ra. Cru# if everthin! was in order, plaintiff even nodded his satisfaction &5earin! of =e. @4, 19--'. t that

    instance, plaintiff did not protest, co%plain or e! for additional ti%e to exa%ine further the 0ewelries &sic'. Bein! aprofessional an6er and en!a!ed in the 0ewelr usiness plaintiff is conversant and co%petent to detect a fa6edia%ond fro% the real thin!. (laintiff was accorded the reasonale ti%e and opportunit to ascertain and inspect the0ewelries &sic' in accordance with rticle 1)?

    $he lower court further ruled that all the ele%ents of a valid contract under rticle 14

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    was %a!nified at(7

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    finished hers on =eruar 4, 19-9, or %ore than a %onth prior to the rendition of the 0ud!%ent. $he :arch /, 19-9hearin! was conducted solel for the presentation of petitionerNs reuttal testi%on.>1)?In other words, ud!e ara%illohad a%ple ti%e to stud the case and write the decision ecause the reuttal evidence would onl serve to confir% orverif the facts alread presented the parties.

    $he Court finds nothin! ano%alous in the said situation. 8o proof has een adduced that ud!e ara%illo was%otivated a %alicious or sinister intent in disposin! of the case with dispatch. 8either is there proof that so%eoneelse wrote the decision for hi%. $he i%%ediate rendition of the decision was no %ore than ud!e ara%illosco%pliance with his dut as a 0ud!e to dispose of the courts usiness pro%ptl and decide cases within the re+uiredperiods.>14?$he two2ear period within which ud!e ara%illo handled the case provided hi% with all the ti%e to studit and even write down its facts as soon as these were presented to court. In fact, this Court does not see anthin!wron! in the practice of writin! a decision das efore the scheduled pro%ul!ation of 0ud!%ent and leavin! thedispositive portion for tpin! at a ti%e close to the date of pro%ul!ation, provided that no %alice or an wron!fulconduct attends its adoption. >1

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    a specific thin! conte%plated the parties with another.>@/?In his alle!ations in the co%plaint, petitioner insinuatedthat an inferior one or one that had onl 3ussian dia%onds was sustituted for the 0ewelr he wanted to exchan!ewith his 1*2hectare land. 5e, however, failed to prove the fact that prior to the deliver of the 0ewelr to hi%, privaterespondents endeavored to %a6e such sustitution.

    Li6ewise, the facts as proven do not support the alle!ation that petitioner hi%self could e excused for the%ista6e. On account of his wor6 as a an6er20eweler, it can e ri!htfull assu%ed that he was an expert on %attersre!ardin! !e%s. 5e had the intellectual capacit and the usiness acu%en as a an6er to ta6e precautionar%easures to avert such a %ista6e, considerin! the value of oth the 0ewelr and his land. $he fact that he had seenthe 0ewelr efore Octoer @4, 19-4 should not have precluded hi% fro% havin! its !enuineness tested in thepresence of r. Cru#. 5ad he done so, he could have avoided the present situation that he hi%self rou!htaout. Indeed, the fin!er of suspicion of switchin! the !enuine 0ewelr for a fa6e inevital points to hi%. uch a%ista6e caused %anifest ne!li!ence cannot invalidate a 0uridical act.>@7?s the Civil Code provides, &t'here is no%ista6e if the part alle!in! it 6new the dout, contin!enc or ris6 affectin! the o0ect of the contract. >@-?

    =urther%ore, petitioner was afforded the reasonale opportunit re+uired in rticle 1@9?B ta6in! the 0ewelr outside the an6, petitioner executed an act which was %ore consistent with his exercise ofownership over it. $his !ains credence when it is orne in %ind that he hi%self had earlier delivered the $anapropert to r. Cru# affixin! his si!nature to the contract of sale. $hat after two hours he later clai%ed that the0ewelr was not the one he intended in exchan!e for his $ana propert, could not sever the 0uridical tie that nowound hi% and r. Cru#. $he nature and value of the thin! he had ta6en preclude its return after that supervenin!period within which anthin! could have happened, not excludin! the alteration of the 0ewelr or its ein! switchedwith an inferior 6ind.

    Both the trial and appellate courts, therefore, correctl ruled that there were no le!al ases for the nullification ofthe contract of sale. Ownership over the parcel of land and the pair of e%erald2cut dia%ond earrin!s had eentransferred to r. Cru# and petitioner, respectivel, upon the actual and constructive deliver thereof. >)*?aid contractof sale ein! asolute in nature, title passed to the vendee upon deliver of the thin! sold since there was nostipulation in the contract that title to the propert sold has een reserved in the seller until full pa%ent of the price orthat the vendor has the ri!ht to unilaterall resolve the contract the %o%ent the uer fails to pa within a fixedperiod.>)1?uch stipulations are not %anifest in the contract of sale.

    hile it is true that the a%ount of (4*,***.** for%in! part of the consideration was still paale to petitioner, itsnonpa%ent r. Cru# is not a sufficient cause to invalidate the contract or ar the transfer of ownership andpossession of the thin!s exchan!ed considerin! the fact that their contract is silent as to when it eco%es due andde%andale.>)@?

    8either %a such failure to pa the alance of the purchase price result in the pa%ent of interestthereon. rticle 1

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    :oral and exe%plar da%a!es %a e awarded without proof of pecuniar loss. In awardin! such da%a!es,the court shall ta6e into account the circu%stances otainin! in the case and assess da%a!es accordin! to itsdiscretion.>)

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    e do not have here, therefore, a situation where petitioners co%plaint was si%pl found later to e ased onan erroneous !round which, under settled 0urisprudence, would not have een a reason for awardin! %oral andexe%plar da%a!es.>4@?Instead, the cause of action of the instant case appears to have een contrived petitionerhi%self. In other words, he was placed in a situation where he could not honestl evaluate whether his cause ofaction has a se%lance of %erit, such that it would re+uire the expertise of the courts to put it to a test. 5is insistentpursuit of such case then coupled with circu%stances showin! that he hi%self was !uilt in rin!in! aout thesupposed wron!doin! on which he anchored his cause of action would render hi% answerale for all da%a!es the

    defendant %a suffer ecause of it. $his is precisel what too6 place in the petition at ar and we find no co!entreason to distur the findin!s of the courts elow that respondents in this case suffered considerale da%a!es due topetitioners unwarranted action.

    WHEREFORE, the decision of the Court of ppeals dated Octoer @*, 199@ is here ==I3:E in toto. r.Cru#, however, is ordered to pa petitioner the alance of the purchase price of (4*,***.** within ten &1*' das fro%the finalit of this decision. Costs a!ainst petitioner.

    SO ORDERED.

    Narvasa, CJ. C!air"an#, $apunan and%urisi"a, JJ., concur.

    >1?(enned ud!e . userto . ara%illo, r.>@?8ote that the parties see%ed to have intended a arter althou!h what the eventuall executed was a deed of asolute sale. ee in this connection

    rticle 14/- of the Civil Code which provides thatA If the consideration of the contract consists partl in %one, and partl in another thin!, thetransaction shall e characteri#ed the %anifest intention of the parties. If such intention does not clearl appear, it shall e considered a arter if thevalue of the thin! !iven as a part of the consideration exceeds the a%ount of the %one or its e+uivalent otherwise, it is a sale>)?&ollo, p. )4?'bid., p. )/.>

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    -----------------------------------xx

    C#z vs. Fe#nan$o %&& SCRA 1&3

    "P". &I" (. 'R&Z an# G.R. NO. 1454*6

    AIDA 'R&Z,P/on/r-, Pr/-/n+

    P&NO, Chairman,A&"TRIA7MARTINEZ,

    @ 'ersus @ 'AEJO, "R.,

    TINGA, an#

    '$I'O7NAZARIO,JJ.

    "P". AEJANDRO !ERNANDO,

    "R., an# RITA !ERNANDO, Prou3a/#+

    R/-:on#/n-. D/0/;/r 9, 2665

    < 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7a pumayag ang mga maysumbong +referring to the Hloriosos, na pagbilhan ang mga

    ipinagsumbong +referring to petitioners, na bahagi ng lupa at ang ipagbibili ay may sukat

    na #! metrong parisukat humigit kumulang sa halagang ;&2.22 bawat metrongparisukatE

    b. >a sa titulong papapanaugin ang magiging kabuuang sukat na mauukol sa mga

    ipinagsusumbong ay ! metrong parisukat at ang #2 metro nito ay bilang kaloob ng mgamaysumbong sa mga *pinagsusumbong na bahagi ng right of wayE

    c. >a ang right of way ay may luwang na #.%0 meters magmula sa daang )ope9 =aena :auno -a

    3=uran n 3o/ na :aaayuan n ;aay n a I:na-u-u;on na =anyan;;3nE

    d. >a ang gugol sa pagpapasukat at pagpapanaog ng titulo ay paghahatian ng magkabilang panigna ang panig ay magbibigay ng halagang hindi kukulanging sa halagang tig@AA;AT >A

    7AA>H ;*5O +;&22.22,E

    e. >a ang ipinagsusumbong ay tiyakang ililipat ang bahay sa bahaging kanilang nabili o mabibilisa buwan ng (nero !#" #$1&E%/+(mphasis supplied,

    http://sc.judiciary.gov.ph/jurisprudence/2005/dec2005/145470.htm#_ftn6http://sc.judiciary.gov.ph/jurisprudence/2005/dec2005/145470.htm#_ftn7http://sc.judiciary.gov.ph/jurisprudence/2005/dec2005/145470.htm#_ftn6http://sc.judiciary.gov.ph/jurisprudence/2005/dec2005/145470.htm#_ftn7
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    Gnder Article #&01 of the Ci'il Code" a contract of sale is a contract by which one of the contracting parties

    obligates himself to transfer the ownership and to deli'er a determinate thing" and the other to pay therefor a price

    certain in money or its e3ui'alent. Article #&%0 of the Code further pro'ides that the contract of sale is perfected at

    the moment there is meeting of the minds upon the thing which is the object of the contract and upon the price.

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    is needed" otherwise there is no sale. #2/As held in $oota 'ha*, %nc. vs. Court of +ppeals"##/a definite agreement on

    the manner of payment of the price is an essential element in the formation of a binding and enforceable contract of

    sale.

    Theasunduandoes not establish any definite agreement between the parties concerning the terms of

    payment. What it merely pro'ides is the purchase price for the #!@s3uare meter property at;&2.22 per s3uare meter.

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    establishing a right of way from )ope9 =aena road going towards the back of the lot" and re3uiring them to relocate

    their house to the portion being sold by =anuary !#" #$1&. ;etitioners are presently occupying the front portion of the

    property. Why the need for a right of way and for petitioners to relocate if the front portion on which their house

    stands is the portion being soldL

    This condition is a suspensi'e condition noncompliance of which pre'ented the Hloriosos from proceeding

    with the sale and ultimately transferring title to petitionersE and theasunduanfrom ha'ing obligatory force. #0/*t is

    established by e'idence that the petitioners did not transfer their house located in the front portion of the subject

    property to the rear portion which" under theasunduan" they intended to buy. Thus" no obligation arose on the part

    of the Hloriosos to consider the subject property as ha'ing been sold to petitioners because the latters non@

    fulfillment of the suspensi'e condition rendered the contract to sell ineffecti'e and unperfected.

    ;etitioners admit that they ha'e not paid a single centa'o to the Hloriosos. 4owe'er" petitioners argue that

    their nonpayment of the purchase price was due to the fact that there is yet to be a sur'ey made of the property. -ut

    e'idence shows" and petitioners do not dispute" that as early as August #" #$1!" or six days after the execution of

    theasunduan" a sur'ey has already been made and the property was subdi'ided into )ot >os. 0:0@-@# +front

    portion, and 0:0@-@ +rear portion," with )ot >o. 0:0@-@ measuring ! s3uare meters as the portion to be bought

    by petitioners.

    ;etitioners 3uestion the sur'ey made" asserting that it is a table sur'ey made without their knowledge and

    participation. *t should be pointed out that theasunduanmerely pro'ides that the expenses for the sur'ey will be

    di'ided between them and that each party should gi'e an amount of no less than ;&22.22. >owhere is it stated that

    the sur'ey is a condition precedent for the payment of the purchase price.

    ;etitioners further claim that respondents ha'e no cause of action against them because their obligation to

    pay the purchase price did not yet arise" as the agreement did not pro'ide for a period within which to pay the

    purchase price. They argue that respondents should ha'e filed an action for specific performance or judicial

    rescission before they can a'ail of accion pu&liciana.

    http://sc.judiciary.gov.ph/jurisprudence/2005/dec2005/145470.htm#_ftn15http://sc.judiciary.gov.ph/jurisprudence/2005/dec2005/145470.htm#_ftn15
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    >otably" petitioners ne'er raised these arguments during the proceedings before the FTC. 5uffice it to say

    that issues raised for the first time on appeal and not raised timely in the proceedings in the lower court are barred by

    estoppel.#:/Matters" theories or arguments not brought out in the original proceedings cannot be considered on

    re'iew or appeal where they are raised for the first time. To consider the alleged facts and arguments raised belatedly

    would amount to trampling on the basic principles of fair play" justice and due process.#%/

    Moreo'er" it would be inutile for respondents to first petition the court to fix a period for the performance

    of the contract. *n the first place" respondents are not parties to theasunduanbetween petitioners and the

    Hloriosos" and they ha'e no standing whatsoe'er to seek such recourse. *n the second place" such recourse properly

    pertains to petitioners. *t was they who should ha'e sought the courts intercession. *f petitioners belie'ed that they

    ha'e an actionable contract for the sale of the property" prudence and common sense dictate that they should ha'e

    sought its enforcement forthwith. *nstead" petitioners whiled away their time.

    u3>33/n o> / -u-:/n-?/ 0on#on -u0 a- / >u33 :ay/n o>

    / :ur0a-/ :r0/, >or n-an0/, 0anno ;/ #///# a ;uy/r n ;a# >aand the prospecti'e

    buyer cannot seek the relief of recon'eyance of the property. T/r/ - no #ou;3/ -a3/ n -u0

    0a-/. Title to the property will transfer to the buyer after registration because there is no defect in

    http://sc.judiciary.gov.ph/jurisprudence/2005/dec2005/145470.htm#_ftn16http://sc.judiciary.gov.ph/jurisprudence/2005/dec2005/145470.htm#_ftn16http://sc.judiciary.gov.ph/jurisprudence/2005/dec2005/145470.htm#_ftn17http://sc.judiciary.gov.ph/jurisprudence/2005/dec2005/145470.htm#_ftn18http://sc.judiciary.gov.ph/jurisprudence/2005/dec2005/145470.htm#_ftn19http://sc.judiciary.gov.ph/jurisprudence/2005/dec2005/145470.htm#_ftn20http://sc.judiciary.gov.ph/jurisprudence/2005/dec2005/145470.htm#_ftn20http://sc.judiciary.gov.ph/jurisprudence/2005/dec2005/145470.htm#_ftn16http://sc.judiciary.gov.ph/jurisprudence/2005/dec2005/145470.htm#_ftn17http://sc.judiciary.gov.ph/jurisprudence/2005/dec2005/145470.htm#_ftn18http://sc.judiciary.gov.ph/jurisprudence/2005/dec2005/145470.htm#_ftn19http://sc.judiciary.gov.ph/jurisprudence/2005/dec2005/145470.htm#_ftn20
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    the owner@sellers titleper se" but the latter" of course" may be sued for damages by the intending

    buyer.#/+(mphasis supplied,

    A person who occupies the land of another at the latters forbearance or permission without any contract

    between them is necessarily bound by an implied promise that he will 'acate upon demand./

    Considering that petitioners continued possession of the property has already been rendered unlawful" they

    are bound to pay reasonable rental for the use and occupation thereof" which in this case was appropriately pegged

    by the FTC at ;022.22 per month beginning October #" #$$& when respondents filed the case against them until

    they 'acate the premises.

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    On 8ove%er @7, 19)1 she donated to the then :unicipalit of Iloilo, 9,*** s+uare %eters of Lot 1@14, to serve assite for the %unicipal hall.1 $he donation was however revo6ed the parties for the reason that the area donatedwas found inade+uate to %eet the re+uire%ents of the develop%ent plan of the %unicipalit, the so2called rellano(lan. @

    use+uentl, Lot 8o. 1@14 was divided Certe#a urvein! Co., Inc. into Lots 1@142 and 1@142B. nd still later,Lot 1@142B was further divided into Lots 1@142B21, Lot 1@142B2@ and Lot 1@142B2). s approved the Bureau of

    Lands, Lot 1@142B21 with 4,

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    +ue dichos lotes porciones son los +ue necesita el oierno %unicipal de Iloilo para la construccion deavenidas, par+ues Cit 5all site del :unicipal overn%ent Center de Iloilo, se!un el plano rellano.

    and ruled that this %eant that uliana :elli#a not onl sold Lots 1@142C and 1@142 ut also suc! ot!er portions oflots as +ere necessary for t!e "unicipal !all site, suc! as Lot --/01. 2nd t!us it !eld t!at 'loilo City !ad t!e rig!t todonate Lot --/01to the ;.(.

    (io ian :elli#a appealed to the Court of ppeals. In its decision on :a 19, 19/

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    nu%er and area. aid next para!raph does not reall add to the clear description that was alread !iven to the% inthe previous one.

    It is therefore the %ore reasonale interpretation, to view itas describing t!ose ot!er portions of land contiguous tot!e lots afore"entionedthat, reference to the rellano plan, will e found needed for the purpose at hand, theconstruction of the cit hall site.

    ppellant however challen!es this view on the !round that the description of said other lots in the afore+uotedsecond para!raph of the pulic instru%ent would there e le!all insufficient, ecause the o0ect would alle!edlnot e deter%inate as re+uired law.

    uch contention fails on several counts. $he re+uire%ent of the law that a sale %ust have for its o0ect a deter%inatethin!, is fulfilled as lon! as, at the ti%e the contract is entered into, the o0ect of the sale is capale of ein! %adedeter%inate without the necessit of a new or further a!ree%ent etween the parties &rt. 1@7), old Civil Code rt.14/*, 8ew Civil Code'. $he specific %ention of so%e of the lots plus the state%ent that the lots o0ect of the sale arethe ones needed for cit hall site, avenues and par6s, according to t!e 2rellano plan, sufficientl provides a asis, asof the ti%e of the execution of the contract, for renderin! deter%inate said lots without the need of a new and furthera!ree%ent of the parties.

    $he rellano plan was in existence as earl as 19@-. s stated, the previous donation of land for cit hall site on8ove%er @7, 19)1 was revo6ed on :arch /, 19)@ for ein! inade+uate in area under said rellano plan. ppellantclai%s that althou!h said plan existed, its %etes and ounds were not fixed until 19)

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    -----------------------------------xx

    Re,io vs. ei#s o* Soses A/e$o an$ 'a#ia Al(ai#ano &02 SCRA 13& l)2013

    G.R. N!. 1'234& 78 24, 213

    REMAN RECIO,(etitioner,vs.HEIRS OF THE SPOUSES AGUEDO "*+ MARIA ALTAMIRANO, *"958 ALEANDRO, ADELAIDA, CATALINA,ALFREDO, FRANCISCO, " 67#*"95+ ALTAMIRANO; VIOLETAALTAMIRANO OLFATO, "*+LORETAALTAMIRANO VDA. DE MARALIT "*+ SPOUSES LAURO "*+ MARCELINA LAARCA, 3espondents.

    E C I I O 8

    REYES, J.:

    $his petition for review on certiorari1under 3ule 4< of the 3ules of Court see6s to %odif the ecision @of the Court ofppeals &C' dated 8ove%er @9, @**7 in C2.3. CH 8o. -/**1, affir%in! with %odification the ecision )datedu!ust @), @**< of the 3e!ional $rial Court &3$C' of Lipa Cit, Branch -< in Civil Case 8o. 972*1*7. $he petitioneras6s this Court to reinstate in full the said 3$C decision.

    $he =acts

    In the 19

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    ac6nowled!ed throu!h a receipt of the sa%e date. use+uentl, the petitioner offered in %an instances to pa there%ainin! alance of the a!reed purchase price of the su0ect propert in the a%ount of $hree 5undred =ort$housand (esos &()4*,***.**', ut le0andro 6ept on avoidin! the petitioner. Because of this, the petitionerde%anded fro% the lta%iranos, throu!h le0andro, the execution of a eed of solute ale in exchan!e for the fullpa%ent of the a!reed price.7

    $hus, on =eruar @4, 1997, the petitioner filed a co%plaint for pecific (erfor%ance with a%a!es. On :arch 14,

    1997, the petitioner also caused to annotate on the $C$ 8o. $21*@

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    5E3E=O3E, pre%ises considered, the u!ust @), @**< ecision of the 3e!ional $rial Court, Br. -

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    Issue

    $he petitioner filed the instant petition alle!in! in the %ain that the C !ravel and seriousl erred in %odifin! the3$C decision.

    Our 3ulin!

    $he petition has no %erit.

    ;nder 3ule 4< of the 3ules of Court, 0urisdiction is !enerall li%ited to the review of errors of law co%%itted theappellate court. $he upre%e Court is not oli!ed to review all over a!ain the evidence which the parties adduced inthe court a +uo. Of course, the !eneral rule ad%its of exceptions, such as where the factual findin!s of the C andthe trial court are conflictin! or contradictor.@1In the instant case, the findin!s of the trial court and its conclusionased on the said findin!s contradict those of the C. fter a careful review, the Court finds no reversile error withthe decision of the C.

    t the core of the present petition is the validit of the veral contract of sale etween le0andro and the petitionerand the eed of solute ale etween the lta%iranos and the pouses La0arca involvin! the su0ect propert.

    valid contract of sale re+uiresA &a' a %eetin! of %inds of the parties to transfer ownership of the thin! sold in

    exchan!e for a price &' the su0ect %atter, which %ust e a possile thin! and &c' the price certain in %one or itse+uivalent.@@

    In the instant case, all these ele%ents are present. $he records disclose that the lta%iranos were the ones whooffered to sell the propert to 8ena ut the transaction did not push throu!h due to the fault of the respondents.$hereafter, the petitioner renewed 8enaQs option to purchase the propert to which le0andro, as the representative ofthe lta%iranos verall a!reed. $he deter%inate su0ect %atter is Lot 8o. ), which is covered under $C$ 8o. $21*@

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    sa%e propert covered $C$ 8o. $21*@

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    MARIA LOURDES P. A. SERENOChief usticeChairperson

    TERESITA . LEONARDO-DE CASTROssociate ustice

    LUCAS P. BERSAMINssociate ustice

    MARTIN S. VILLARAMA, R.ssociate ustice

    C E 3 $ I = I C $ I O 8

    (ursuant to ection 1), rticle HIII of the Constitution, I certif that the conclusions in the aove ecision had eenreached in consultation efore the case was assi!ned to the writer of the opinion of the CourtNs ivision.

    MARIA LOURDES P. A. SERENOChief ustice

    F!!*!56

    13ollo, pp. -2@

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    within the (hilippines, in which the defendant has or clai%s a lien or interest, actual or contin!ent, or inwhich relief de%anded consists, wholl or in part, in excludin! the defendant fro% an interest therein, or thepropert of the defendant has een attached in the (hilippines, service %a, leave of court, e effectedout of the (hilippines personal service as under section 7 or pulication in a newspaper of !eneralcirculation in such places and for such ti%e as the court %a order, in which case a cop of the su%%onsand order of the court shall e sent re!istered %ail to the last 6nown address of the defendant, or in another %anner the court %a dee% sufficient. n order !rantin! such leave shall specif a reasonale ti%e,

    which shall not e less than sixt &/*' das after notice, within which the defendant %ust answer.

    1/3ollo, pp. )42)

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    Dao en/ ank vs. Ss. Lai/o 4&1 SCRA %3%

    DAO $ENG BAN@, IN'., no

    BAN'O DE ORO &NI(ER"A

    BAN@,;etitioner"

    7 ?/r-u- 7

    "P". IIA an# RE%NADO AIGO,

    Fespondents.

    G.R. No. 1*85

    Pr/-/n+

    8G*5GM-*>H"J., Chairperson,CAF;*O MOFA)(5"

    T*>HA"

    ?()A5CO" =F." and

    -F*O>"JJ.

    Prou3a/#+

    No?/;/r 26, 2668

    "E'OND DI(I"ION

    < 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 7 O ;(F (> ;AHO CO>TFACTE

    **.

    . . . T4AT T4( A))(H(7 7AC*O> (> ;AHO *5 >OT G>(>7(F T4(

    5TATGT( O<

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    &. 5ometime in the middle of the year 222" defendant 7ao 4eng -ank as the creditor bank agreed to the

    full settlement of plaintiffs mortgage obligation of ;$ Million through the assignment of one of the

    two +, mortgaged propertiesE

    0/ As part of the agreement" defendant 7ao 4eng -ank had the mortgaged properties appraised to

    determine which of the two +, mortgaged properties shall be deli'ered as full payment of the

    mortgage obligationE Also as part of the deal" plaintiffs for their part paid ; 0"222.22 for the

    appraisal expenseE As reported by the appraiser commissioned by defendant 7ao 4eng" theappraised 'alue of the mortgaged properties were as followsD

    +a, ;roperty >o. # T.C.T. >o. $0%D ;#"0#1"222.22

    )A -lk # 7on Mariano MarcosA'e." (HOT*AT*O>5 to settle the loan by way of dacion" nothing came out of saidproposal" much less did the negotiations mature into the execution of a dacion en pago

    instrument. 7efendant 7ao 4eng -ank found the offer to settle by way of dacion not acceptableand thus" it opted to foreclose on the mortgage.

    The law clearly pro'ides that the debtor of a thing cannot compel the creditor to recei'e a different

    one" although the latter may be of the same 'alue" or more 'aluable than that which is due +Article#&&" >ew Ci'il Code,. The oblige is entitled to demand fulfillment of the obligation or

    performance as stipulated +;almares '. Court of Appeals" 11 5CFA & at p. &&& #$$1/,. The

    power to decide whether or not to foreclose on the mortgage is the sole prerogati'e of the

    http://sc.judiciary.gov.ph/jurisprudence/2008/november2008/173856.htm#_ftn10http://sc.judiciary.gov.ph/jurisprudence/2008/november2008/173856.htm#_ftn10http://sc.judiciary.gov.ph/jurisprudence/2008/november2008/173856.htm#_ftn11http://sc.judiciary.gov.ph/jurisprudence/2008/november2008/173856.htm#_ftn10http://sc.judiciary.gov.ph/jurisprudence/2008/november2008/173856.htm#_ftn11
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    mortgagee +"ural 5an of 'an Mateo, %nc. vs. %ntermediate +ppellate Court, #&: 5CFA 20" at

    #! #$1:/, 7efendant 7ao 4eng -ank merely opted to exercise such prerogati'e.#/+(mphasis in

    the originalE capitali9ation and underscoring supplied,

    Dacion en pagoas a mode of extinguishing an existing obligation partakes of the nature of sale whereby property is

    alienated to the creditor in satisfaction of a debt in money.#!/*t is an objecti'e no'ation of the obligation"

    hence" common consent of the parties is re3uired in order to extinguish the obligation.

    . . .*n dacion en pago" as a special mode of payment" the debtor offers another thing to the creditor

    who accepts it as e3ui'alent of payment of an outstanding debt. The undertaking really partakes in

    one sense of the nature of sale" that is" the creditor is really buying the thing or property of thedebtor" payment for which is to be charged against the debtors debt. As such the elements of a

    contract of sale" namely" consent" object certain" and cause or consideration must be present. *n its

    modern concept" what actually takes place indacion en pago is an objecti'e no'ation of the

    obligation where the thing offered as an accepted e3ui'alent of the performance of an obligation isconsidered as the object of the contract of sale" while the debt is considered the purchase price. *n

    any case" 0oon

    0on-/n is an essential prere3uisite" &e it sale or novation" to ha'e the effect of totally

    extinguishing the debt or obligation.#&/

    +(mphasis" italics and underscoring suppliedE citationomitted,

    -eing likened to that of a contract of sale"dacion en pagois go'erned by the law on sales. #0/The partial execution

    of a contract of sale takes the transaction out of the pro'isions of the 5tatute of

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    $ERE!ORE,the Court of Appeals 7ecision of =anuary :" 22: isRE(ER"EDan# "ET A"IDE. The

    Fesolution of =uly " 22 of the Fegional Trial Court of 8ue9on City" -ranch #0 dismissing respondents

    complaint is REIN"TATED.

    "O ORDERED.

    -----------------------------------xx

    Alonso vs. Ce5 Con(#) Cl5 +n,. 3&4 SCRA 3"0

    G.R. N!. 1''41 A/#0 2, 21

    FRANCISCO ALONSO, 67:6075+ :8 MERCEDES V. ALONSO, TOMAS V. ALONSO "*+ ASUNCION V.ALONSO,(etitioners,vs.CEBU COUNTRY CLUB, INC.,3espondent,

    REPUBLIC OF THE PHILIPPINES, #5/#565*5+ :8 %5 OFFICE OF THE SOLICITOR GENERAL,(ulic3espondent.

    E C I I O 8

    BERSAMIN, J.:

    B petition for review on certiorari, the petitioners appeal the order dated ece%er @-, @**7 of the 3e!ional $rialCourt &3$C', Branch @*, in Ceu Cit, denin! the "otion for issuance of +rit of e(ecutionof the Office of theolicitor eneral &O' in ehalf of the overn%ent, and the order dated pril @4, @**9, denin! their %otion forreconsideration filed a!ainst the first order.

    A*5$5+5*6

    $he antecedent facts are those estalished in2lonso v. Cebu Country Club,1which follow.

    (etitioner =rancisco :. lonso &=rancisco' was the onl son and sole heir of the late spouses $o%as 8. lonso andsuncion :edalle. =rancisco died durin! the pendenc of this case,and was sustituted his le!al heirs, na%elAhis survivin! spouse, :ercedes H. lonso, his son $o%as H. lonso &$o%as' and his dau!hter suncion H. lonso.@

    In 199@, =rancisco discovered docu%ents showin! that his father $o%as 8. lonso had ac+uired Lot 8o. 7@7 of theBanilad =riar Lands Estate fro% the overn%ent in or aout the ear 1911 that the ori!inal vendee of Lot 8o. 7@7had assi!ned his sales certificate to $o%as 8. lonso, who had een conse+uentl issued (atent 8o. 14)

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    on :arch @7, 19@/, the irector of Lands had executed a final deed of sale in favor of $o%as 8. lonso, ut the f inaldeed of sale had not een re!istered with the 3e!ister of eeds ecause of lac6 of re+uire%ents, li6e the approval ofthe final deed of sale the ecretar of !riculture and 8atural 3esources, as re+uired law.)

    =rancisco suse+uentl found that the certificate of title coverin! Lot 8o. 7@722@ of the Banilad =riar Lands Estatehad een ad%inistrativel reconstituted fro% the ownerQs duplicate of $ransfer Certificate of $itle &$C$' 8o. 3$21)1*in the na%e of ;nited ervice Countr Clu, Inc., the predecessor of respondent Ceu Countr Clu, Inc &Ceu

    Countr Clu' and that upon the order of the court that had heard the petition for reconstitution of the $C$, the na%eof the re!istered owner in $C$ 8o. 3$21)1* had een chan!ed to that of Ceu Countr Clu and that the $C$ statedthat the reconstituted title was a transfer fro% $C$ 8o. 1*@1.4

    It is relevant to %ention at this point that the current $C$ coverin! Lot 7@722@ in the na%e of Ceu Countr Clu is$C$ 8o. 949*

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    ;pon ein! directed the 3$C to co%%ent on the petitionersQ %otion for reconsideration, the O %anifested inwritin! that the overn%ent was no lon!er see6in! the execution of the decision in .3. 8o. 1)*-7/, su0ect to itsreservation to contest an other titles within the Banilad =riar Lands Estate should clear evidence show such titles ashavin! een otained throu!h fraud.17

    fter the filin! of the OQs co%%ent, the 3$C issued the second appealed order, denin! the petitionersQ %otion forreconsideration, !ivin! the followin! reasonsA

    1. $he part who had a direct interest in the execution of the decision and the reconsideration of the denialof the %otion for execution was the overn%ent, represented onl the O hence, the petitioners hadno le!al standin! to file the %otion for reconsideration, especiall that the were not authori#ed the Ofor that purpose

    @. 3.. 8o. 944) confir%s and declares as valid all existin! $C$s and reconstituted titles there, thetate in effect waived and divested itself of whatever title or ownership over the Banilad =riar Lands Estatein favor of the re!istered owners thereof, includin! Lot 7@7 2@ and

    ). $he situation of the parties had %ateriall chan!ed, renderin! the enforce%ent of the final and executor0ud!%ent un0ust, ine+uitale, and i%possile, ecause Ceu Countr Clu was now reco!ni#ed the tateitself as the asolute owner of Lot 7@7 [email protected]

    5ence, the petitioners appeal petition for review oncertiorari.

    Contentions of the (etitioners

    $he petitioners challen!e the orders dated ece%er @-, @**7 and pril @9, @**9, ecauseA

    1. 3.. 8o. 944) did not i%prove Ceu Countr CluQs pli!ht, inas%uch as 3.. 8o. 944) presupposed firsta sales certificate that lac6ed the re+uired si!nature, ut Ceu Countr Clu did not have such salescertificate. :oreover, the titleholders were in fact the owners of the lands covered their respective titles,which was not true with Ceu Countr Clu due to its ein! alread ad0ud!ed with finalit to e not theowner of Lot 7@722@. Lastl, Ceu Countr CluQs title was hopelessl defective, as found the upre%eCourt itself

    @. $he doctrine of law of the case arred the application of 3.. 8o. 944) to Ceu Countr Clu

    ). $he 3$CQs declaration that 3.. 8o. 944) confir%ed Ceu Countr Clu as the asolute owner of Lot7@722@ despite the prior and final 0ud!%ent of the upre%e Court that Ceu Countr Clu was not theowner was unconstitutional, ecause it virtuall allowed the le!islative review of the upre%e CourtQsdecision rendered a!ainst Ceu Countr Clu

    4. $he use of 3.. 8o. 944) as a waiver on the part of the overn%ent vis2T2vis Ceu Countr Clu was notonl %isplaced ut downri!htl repu!nant to ct 11@*, the law !overnin! the le!al disposition and alienationof =riar Lands and

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    @. hether or not 3.. 8o. 944) !ave the petitioners a le!al interest to assail the 3$CQs orders and

    ). hether or not the petitioners can appeal petition for review on certiorari in ehalf of the O.

    R70*

    $he petition for review is denied due course.

    A. P#5090*"#8 C!*60+5#"0!*6

    (etitioners contravene the hierarch of courts, and the petition is fatall defective

    Before delvin! on the stated issues, the Court notes that the petitioners are !uilt of two violations that warrant thei%%ediate dis%issal of the petition for review on certiorari.

    $he first refers to the petitionersQ reach of the hierarch of courts co%in! directl to the Court to appeal theassailed issuances of the 3$C via petition for review on certiorari. $he should not have done so, passin! a review the Court of ppeals &C', ecause the hierarch of courts is essential to the efficient functionin! of the courts andto the orderl ad%inistration of 0ustice. $heir non2oservance of the hierarch of courts has forthwith enlar!ed thedoc6et of the Court one %ore case, which, thou!h it %a not see% urdenso%e to the la%an, is one case too%uch to the Court, which has to devote ti%e and effort in porin! over the papers su%itted herein, onl to discover inthe end that a review should have first een %ade the C. $he ti%e and effort could have een dedicated to othercases of i%portance and i%pact on the lives and ri!hts of others.

    $he hierarch of courts is not to e li!htl re!arded liti!ants. $he C stands etween the 3$C and the Court, andits estalish%ent has een precisel to ta6e over %uch of the wor6 that used to e done the Court. 5istoricall, theC has een of the !reatest help to the Court in snthesi#in! the facts, issues, and rulin!s in an orderl andintelli!ile %anner and in identifin! errors that ordinaril %i!ht escape detection. $he Court has thus een freed toetter dischar!e its constitutional duties and perfor% its %ost i%portant wor6, which, in the words of ean Hicente .inco,@*is less concerned with the decision of cases that e!in and end with the transient ri!hts and oli!ations ofparticular individuals ut is %ore intertwined with the direction of national policies, %o%entous econo%ic and socialprole%s, the deli%itation of !overn%ental authorit and its i%pact upon funda%ental ri!hts. @1

    $he need to elevate the %atter first to the C is also underscored the realit that deter%inin! whether thepetitioners were real parties in interest entitled to rin! this appeal a!ainst the denial the 3$C of the OQs"otionfor t!e issuance of a +rit of e(ecutionwas a %ixed +uestion of fact and law. s such, the C was in the etterposition to review and to deter%ine. In that re!ard, the petitioners violate ection 1, 3ule 4< of the 1997 3ules of Civil(rocedure, which de%ands that an appeal petition for review on certiorari e li%ited to +uestions of law.@@

    $he second violation concerns the o%ission of a sworn certification a!ainst foru% shoppin! fro% the petition forreview on certiorari. ection 4, 3ule 4< of the 1997 3ules of Civil (rocedure re+uires that the petition for reviewshould contain, a%on! others, the sworn certification on the underta6in!s provided in the last para!raph of ection @,3ule 4@ of the 1997 3ules of Civil (rocedure, vi#A

    ection @. xxx

    $he petitioner shall also su%it to!ether with the petition a certification under oath that he has not theretofore

    co%%enced an other action involvin! the sa%e issues in the upre%e Court, the Court of ppeals or differentdivisions thereof, or an other triunal or a!enc if there is such other action or proceedin!, he %ust state the statusof the sa%e and if he should thereafter learn that a si%ilar action or proceedin! has een filed or is pendin! eforethe upre%e Court, the Court of ppeals, or different divisions thereof, or an other triunal or a!enc, he underta6esto pro%ptl infor% the aforesaid courts and other triunal or a!enc thereof within five &

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    failure of :ercedes and suncion to si!n and execute the certification alon! with $o%as warranted the dis%issal oftheir petition.@4

    B. P500!*5#6 "#5 *! /#!/5# /"#056 ! "//5" "*+ "66"0 %5 !#+5# !< %5 RTC

    $he petitioners are relentless in insistin! that their clai% to Lot 8o. 7@722@ of the Banilad =riar Lands Estate shoulde preferred to that of Ceu Countr Clu, despite the final 0ud!%ent in .3. 8o. 1)*-7/ ein! adverse to their clai%.$heir insistence raises the need to resolve once and for all whether or not the petitioners retained an le!al ri!ht toassert over Lot 8o. 7@722@ followin! the overn%entQs %anifest desistance fro% the execution of the 0ud!%ent in.3. 8o. 1)*-7/ a!ainst Ceu Countr Clu.

    $he aove2noted defects of the petition for review notwithstandin!, therefore, the Court has now to address andresolve the stated issues on the sole asis of the results the Court earlier reached in .3. 8o. 1)*-7/. In this re!ard,whether or not the petitioners are the proper parties to rin! this appeal is decisive.

    fter careful consideration, the Court finds that the cause of the petitioners instantl fails.

    In .3. 8o. 1)*-7/, the Court found that the petitioners did not validl ac+uire ownership of Lot 8o. 7@722@, anddeclared that Lot 8o. 7@7 2@ le!all elon!ed to the overn%ent, thusA

    $he second issue is whether the Court of ppeals erred in rulin! that the Ceu Countr Clu, Inc. is owner of Lot 8o.7@7.

    d%ittedl,*50%5# /500!*5#6 *!# %50# /#5+5$566!# %"+ "*8 05 ! %5 "*+ 0* =7560!*. $he %ost thatpetitioners could clai% was that the irector of Lands issued a sales patent in the na%e of $o%as 8. lonso. T%56"56 /"5*, however,"*+ 5>5* %5 $!##56/!*+0* +55+ !< 6"5?5#5 *! #5065#5+ ?0% %5 R5065# !5# 06675+ 0* %5 *"95 !< %5 "5#. $his is ecause there were asic re+uire%ents notco%plied with, the %ost i%portant of which was that %5 +55+ !< 6"5 5@5$75+ :8 %5 D0#5$!# !< L"*+6 ?"6 *!"//#!>5+ :8 %5 S5$#5"#8 !< A#0$77#5 "*+ N"7#" R56!7#$56.5ence, %5 +55+ !< 6"5 ?"6 >!0+. pproval the ecretar of !riculture and Co%%erce is indispensale for the validit of the sale. :oreover, Ceu CountrClu, Inc. was in possession of the land since 19)1, and had een pain! the real estate taxes thereon ased on taxdeclarations in its na%e with the title nu%er indicated thereon. $ax receipts and declarations of ownership fortaxation purposes are stron! evidence of ownership. $his Court has ruled that althou!h tax declarations or realt taxpa%ents are not conclusive evidence of ownership, nevertheless, the are !ood indicia of possession in the concept

    of owner for no one in his ri!ht %ind will e pain! taxes for a propert that is not in his actual or constructivepossession.

    8otwithstandin! this fatal defect, the Court of ppeals ruled that there was sustantial co%pliance with there+uire%ent of ct 8o. 11@* to validl conve title to said lot to $o%as 8. lonso.

    On this point, the Court of ppeals erred.

    ;nder ct 8o. 11@*, which !overns the ad%inistration and disposition of friar lands, the purchase an actual andona fide settler or occupant of an portion of friar land shall e a!reed upon etween the purchaser and theirector of Lands, su0ect to the approval of the ecretar of !riculture and 8atural 3esources "utatis "utandis#.7

    In his :e%orandu% filed on :a @!0+ ":-0*00!. 8ecessaril, there can e no valid titles issued on the asis ofsuch sale or assi!n%ent. C!*65=75*8, /500!*5# F#"*$06$!6 5 "*8 #5065#":5 05 ! %5"*+ 0* =7560!*. H">0* *!*5, %5 $!7+ *! #"*690 "*8%0* ! %06 6!5 %50#, /500!*5# F#"*$06$! A!*6! !#%5 "5#6 %50#6.

    http://www.lawphil.net/judjuris/juri2010/apr2010/gr_188471_2010.html#fnt24http://www.lawphil.net/judjuris/juri2010/apr2010/gr_188471_2010.html#fnt24http://www.lawphil.net/judjuris/juri2000/jan2000/gr_102961_2000.htmlhttp://www.lawphil.net/judjuris/juri2000/jan2000/gr_102961_2000.htmlhttp://www.lawphil.net/judjuris/juri2010/apr2010/gr_188471_2010.html#fnt24http://www.lawphil.net/judjuris/juri2000/jan2000/gr_102961_2000.html
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    In a vain atte%pt at showin! that he had succeeded to the estate of his father, on :a 4, 1991, petitioner =ranciscolonso executed an affidavit ad0udicatin! the entire estate to hi%self &Exh. "',dul pulished in a newspaper of!eneral circulation in the province and cit of Ceu &Exh. "21'. uch affidavit of self2ad0udication is inoperative, ifnot void, not onl ecause there was nothin! to ad0udicate, ut e+uall i%portant ecause petitioner =rancisco did notshow proof of pa%ent of the estate tax and su%it a certificate of clearance fro% the Co%%issioner of Internal3evenue. Oviousl, petitioner =rancisco has not paid the estate taxes.

    C!*65=75*8, ?5 #75 %" *50%5# T!9"6 N. A!*6! *!# %06 6!* F#"*$06$! M. A!*6! !# %5 "5#6 %50#6 "#5%5 "?56 /500!*5#6 *! 5" 0*5#56 ! "66"0 %5 +5*0" !< %5 9!0!*

    ection 1 of 3.. 8o. 944) providesA

    ection 1. A 5@060* T#"*6

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    ceased to have an practical effect as the result of the enact%ent of 3.. 8o. 944), and had there eco%eacade%ic.)@

    On the other hand, the petitioners could not enefit fro% 3.. 8o. 944) ecause of their non2co%pliance with theexpress condition of holdin! an $ransfer Certificate of $itle or 3econstituted Certificate of $itle respectin! Lot 7@722@ or an portion thereof. -a+p!8-

    $he appropriate recourse for the petitioners, if the persist in the elief that the $C$ of Ceu Countr Clu should enullified, is to co%pel the O throu!h the special civil action for %anda%us to co%%ence the action to annul on the!round that Ceu Countr Clu had otained its title to Lot 7@1722@ throu!h fraud. Jet, that recourse is no lon!eravailin!, for the decision in .3. 8o. 1)*-7/ explicitl found and declared that the reconstituted title of Ceu CountrClu had not een otained throu!h fraud. aid the CourtA

    On the +uestion that $C$ 8o. 3$21)1* &$211)5#0* %5 /#!/5#8 6%!?5+ %5 *79:5# !< %5 TCT !< %5"*+. C5:7 C!7*#8 C7:, I*$. /#!+7$5+ #5$50/6 6%!?0* #5" 56"5 "@ /"895*6 60*$5 1&4&. On the otherhand, petitioner failed to produce a sin!le receipt of real estate tax pa%ent ever %ade his father since the salespatent was issued to his father on :arch @4, 19@/. orse, ad%ittedl petitioner could not show an >$?orrens title

    ever issued to $o%as 8. lonso, ecause, as said, the deed of sale executed on :arch @7, 19@/ the irector ofLands was not approved the ecretar of !riculture and 8atural 3esources and could not e re!istered. ;nderthe law, it is the act of re!istration of the deed of conveance that serves as the operative act to conve the landre!istered under the $orrens sste%. $he act of re!istration creates constructive notice to the whole world of the factof such conveance. On this point, /500!*5# "556 %" C5:7 C!7*#8 C7:, I*$. !:"0*5+ 06 05 :8

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    -----------------------------------xx

    6)a( vs. A#,o &2 67il %02 1"%19

    G.R. N!. L-43' 7*5 2, 1&41

    GON)ALO PUYAT J SONS, INC.,petitioner,vs.ARCO AMUSEMENT COMPANY

    5eria 9 Lao for petitioner.J. :. 5errier and Daniel 3e. o"ez for respondent.

    LAUREL, J.

    $his is a petition for the issuance of a writ of certiorarito the Court of ppeals for the purpose of reviewin!its %use%ent Co%pan &for%erl 6nown as $eatro rco', plaintiff2appellant, vs. on#alo (uat andons. Inc., defendant2appellee.

    It appears that the respondent herein rou!ht an action a!ainst the herein petitioner in the Court of =irstInstance of :anila to secure a rei%urse%ent of certain a%ounts alle!edl overpaid it on account ofthe purchase price of sound reproducin! e+uip%ent and %achiner ordered the petitioner fro% thetarr (iano Co%pan of 3ich%ond, Indiana, ;... $he facts of the case as found the trial court andconfir%ed the appellate court, which are ad%itted the respondent, are as followsA

    In the ear 19@9, the $eatro rco, a corporation dul or!ani#ed under the laws of the (hilippineIslands, with its office in :anila, was en!a!ed in the usiness of operatin! cine%ato!raphs. In19)*, its na%e was chan!ed to rco %use%ent Co%pan. C. . al%on was the president,

    while . B. Coulette was the usiness %ana!er. out the sa%e ti%e, on#alo (uat F ons,Inc., another corporation doin! usiness in the (hilippine Islands, with office in :anila, in additionto its other usiness, was actin! as exclusive a!ents in the (hilippines for the tarr (ianoCo%pan of 3ich%ond, Indiana, ;.. . It would see% that this last co%pan dealt incine%ato!rapher e+uip%ent and %achiner, and the rco %use%ent Co%pan desirin! toe+uipt its cine%ato!raph with sound reproducin! devices, approached on#alo (uat F ons,Inc., thru its then president and actin! %ana!er, il (uat, and an e%ploee na%ed antos. fterso%e ne!otiations, it was a!reed etween the parties, that is to sa, al%on and Coulette on oneside, representin! the plaintiff, and il (uat on the other, representin! the defendant, that thelatter would, on ehalf of the plaintiff, order sound reproducin! e+uip%ent fro% the tarr (ianoCo%pan and that the plaintiff would pa the defendant, in addition to the price of the e+uip%ent,a 1* per cent co%%ission, plus all expenses, such as, frei!ht, insurance, an6in! char!es,cales, etc. t the expense of the plaintiff, the defendant sent a cale, Exhiit ), to the tarr

    (iano Co%pan, in+uirin! aout the e+uip%ent desired and %a6in! the said co%pan to +uote itsprice without discount. repl was received on#alo (uat F ons, Inc., with the price,evidentl the list price of D1,7** f.o.. factor 3ich%ond, Indiana. $he defendant did not show theplaintiff the cale of in+uir nor the repl ut %erel infor%ed the plaintiff of the price of D1,7**.Bein! a!reeale to this price, the plaintiff, %eans of Exhiit 1, which is a letter si!ned C.. al%on dated 8ove%er 19, 19@9, for%all authori#ed the order. $he e+uip%ent arrived aoutthe end of the ear 19@9, and upon deliver of the sa%e to the plaintiff and the presentation ofnecessar papers, the price of D1.7**, plus the 1* per cent co%%ission a!reed upon and plus allthe expenses and char!es, was dul paid the plaintiff to the defendant.

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    o%eti%e the followin! ear, and after so%e ne!otiations etween the sa%e parties, plaintiff anddefendants, another order for sound reproducin! e+uip%ent was placed the plaintiff with thedefendant, on the sa%e ter%s as the first order. $his a!ree%ent or order was confir%ed theplaintiff its letter Exhiit @, without date, that is to sa, that the plaintiff would pa for thee+uip%ent the a%ount of D1,/**, which was supposed to e the price +uoted the tarr (ianoCo%pan, plus 1* per cent co%%ission, plus all expenses incurred. $he e+uip%ent under thesecond order arrived in due ti%e, and the defendant was dul paid the price of D1,/** with its 1*per cent co%%ission, and D1/*, for all expenses and char!es. $his a%ount of D1/* does notrepresent actual out2of2poc6et expenses paid the defendant, ut a %ere flat char!e and rou!hesti%ate %ade the defendant e+uivalent to 1* per cent of the price of D1,/** of the e+uip%ent.

    out three ears later, in connection with a civil case in Hi!an, filed one =idel 3ees a!ainstthe defendant herein on#alo (uat F ons, Inc., the officials of the rco %use%ent Co%pandiscovered that the price +uoted to the% the defendant with re!ard to their two orders%entioned was not the net price ut rather the list price, and that the defendants had otained adiscount fro% the tarr (iano Co%pan. :oreover, readin! reviews and literature on prices of%achiner and cine%ato!raph e+uip%ent, said officials of the plaintiff were convinced that theprices char!ed the% the defendant were %uch too hi!h includin! the char!es for out2of2poc6etexpense. =or these reasons, the sou!ht to otain a reduction fro% the defendant or rather arei%urse%ent, and failin! in this the rou!ht the present action.

    $he trial court held that the contract etween the petitioner and the respondent was one of outri!htpurchase and sale, and asolved that petitioner fro% the co%plaint. $he appellate court, however, P adivision of four, with one 0ustice dissentin! P held that the relation etween petitioner and respondentwas that of a!ent and principal, the petitioner actin! as a!ent of the respondent in the purchase of thee+uip%ent in +uestion, and sentenced the petitioner to pa the respondent alle!ed overpa%ents in thetotal su% of D1,))

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    accepted the prices of D1,7** and D1,/**, respectivel, for the sound reproducin! e+uip%ent su0ect ofits contract with the petitioner, are clear in their ter%s and ad%it no other interpretation that therespondent in +uestion at the prices indicated which are fixed and deter%inate. $he respondent ad%ittedin its co%plaint filed with the Court of =irst Instance of :anila that the petitioner a!reed to sellto it the firstsound reproducin! e+uip%ent and %achiner. $he third para!raph of the respondentNs cause of actionstatesA

    ). $hat on or aout 8ove%er 19, 19@9, the herein plaintiff &respondent' and defendant&petitioner' entered into an a!ree%ent, under and virtue of which the herein defendant was tosecure fro% the ;nited tates, and selland deliver to the herein plaintiff, certain soundreproducin! e+uip%ent and %achiner, for which the said defendant, under and virtue of saida!ree%ent, was to receive the actual cost price plus ten per cent &1*V', and was also to erei%ursed for all out of poc6et expenses in connection with the purchase and deliver of suche+uip%ent, such as costs of tele!ra%s, frei!ht, and si%ilar expenses. &E%phasis ours.'

    e a!ree with the trial 0ud!e that whatever unforseen events %i!ht have ta6en place unfavorale to thedefendant &petitioner', such as chan!e in prices, %ista6e in their +uotation, loss of the !oods not covered insurance or failure of the tarr (iano Co%pan to properl fill the orders as per specifications, theplaintiff &respondent' %i!ht still le!all hold the defendant &petitioner' to the prices fixed of D1,7** and

    D1,/**. $his is inco%patile with the pretended relation of a!enc etween the petitioner and therespondent, ecause in a!enc, the a!ent is exe%pted fro% all liailit in the dischar!e of his co%%issionprovided he acts in accordance with the instructions received fro% his principal &section @

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    petitioner provided it was !iven the enefit of the @< per cent discount en0oed the petitioner. It is well6nown that local dealers actin! as a!ents of forei!n %anufacturers, aside fro% otainin! a discount fro%the ho%e office, so%eti%es add to the list price when the resell to local purchasers. It was apparentl to!uard a!ainst an exhoritant additional price that the respondent sou!ht to li%it it to 1* per cent, and therespondent is estopped fro% +uestionin! that additional price. If the respondent later on discovers itself atthe short end of a ad ar!ain, it alone %ust ear the la%e, and it cannot rescind the contract, %uchless co%pel a rei%urse%ent of the excess price, on that !round alone. $he respondent could not securee+uip%ent and %achiner %anufactured the tarr (iano Co%pan except fro% the petitioner alone itwillin!l paid the price +uoted it received the e+uip%ent and %achiner as represented and that was theend of the %atter as far as the respondent was concerned. $he fact that the petitioner otained %ore orless profit than the respondent calculated efore enterin! into the contract or reducin! the price a!reedupon etween the petitioner and the respondent. 8ot ever conceal%ent is fraud and short of fraud, itwere etter that, within certain li%its, usiness acu%en per%it of the loosenin! of the sleeves and of thesharpenin! of the intellect of %en and wo%en in the usiness world.

    $he writ of certiorarishould e, as it is here, !ranted. $he decision of the appellate court is accordin!lreversed and the petitioner is asolved fro% the respondentNs co%plaint in . 3. 8o. 1*@), entitled rco

    %use%ent Co%pan &for%erl 6nown as $eatro rco', plaintiff2appellant, vs. on#alo (uat F ons,Inc., defendants2appellee, without pronounce%ent re!ardin! costs. o ordered.

    2vance;a, C.J., Diaz, 3oran and

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    In the earlier cases, :anila 3e%nant Co., Inc. &:3CI' was the petitioner, ein! the owner of several parcels of land situated in"ue#on Cit, constitutin! the sudivision 6nown as Capitol 5o%es udivision 8os. I and II. On ul @

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    In a %anifestation and %otion, however, :3CI alle!ed that the su0ect properties could not lon!er e delivered to the Hentanillasecause the had alread een sold to a%uel :ar+ue# &:ar+ue#' on =eruar 7, 199*, while its petition was pendin! efore thisCourt. 8evertheless, :3CI offered to rei%urse the a%ount paid the Hentanillas, includin! le!al interest plus da%a!es. :3CIalso praed that its tender of pa%ent e accepted and that all !arnish%ents on their accounts lifted.

    $he Hentanillas accepted the a%ount of (@1*,***.** as da%a!es and attorneQs fees ut re0ected the rei%urse%ent offered :3CI in lieu of the execution of the asolute deed of sale. $he contended that the alle!ed sale to :ar+ue# was void, fraudulent,and in conte%pt of court and that no clai% of ownership over the properties in +uestion had ever een %ade :ar+ue#.

    On ul 19, 1991, the C=I "ue#on Cit ordered that the !arnish%ent %ade the heriff upon the an6 account of :3CI could elifted onl upon the deposit to the Court of the a%ount of (

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    s it turned out, the execution of the 0ud!%ent in favor of the Hentanillas was et far fro% fruition. a%uel Cleofe, 3e!ister of eedsfor "ue#on Cit &3O Cleofe' revealed to the%, that on :arch 11, 199@, :3CI re!istered a deed of asolute sale to :ar+ue# whoeventuall sold the sa%e propert to the aerons, which conveance was re!istered in ul 199@. 3O Cleofe opined that a0udicial order for the cancellation of the titles in the na%e of the aerons was essential efore he co%plied with the writ ofexecution in Civil Case 8o. @/411. pparentl, the notice of lev, throu!h inadvertence, was not carried over to the t itle issued to:ar+ue#, the sa%e ein! a 0unior encu%rance which was entered after the contract to sell to :ar+ue# had alread eenannotated.

    Civil Case 8o. "29/2@/4-/

    Once a!ain, the Hentanillas were constrained to !o to court to see6 the annul%ent of the deed of sale executed etween :3CI and:ar+ue# as well as the deed of sale etween :ar+ue# and the aerons, as the fruits of void conveances. $he case was doc6etedas Civil Case 8o. "29/2@/4-/ with the 3e!ional $rial Court, Branch -*, "ue#on Cit &3$C'.

    urin! the trial, all the defendants, includin! Ed!ar rohn r. &rohn' as (resident of :3CI, and Bede $aalin!cos &$aalin!cos' asits le!al counsel, filed their respective answers, except :ar+ue# who was declared in default.

    On une @1, @**

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    :3CIQs titles. $he notice of lev in Civil Case 8o. @/411 ca%e ten das later, on :a )1, 1991. $hen, in =eruar 199@, :3CIexecuted a deed of asolute sale to :ar+ue# and when the new titles were issued in :ar+ue#Q na%e, the notice of lev was notcarried over. few %onths later, these t itles were cancelled virtue of a deed of sale to the aerons and, on the sa%e da, $C$/)14* and /)141 were issued clean to the%.

    ccordin! to the C, the ar!u%ents espoused :3CI and $aalin!cos were untenale. $he said parties were found !uilt of adfaith for sellin! the lots to :ar+ue# at a ti%e when liti!ation as to the validit of the first sale to the Hentanillas was still pendin!. Inother words, :3CI was sufficientl aware of the Court decision confir%in! its failure to supervise and control the affairs of its

    authori#ed a!ent, ;HC, which led to the explicit pronounce%ent that the first sale to the Hentanillas was valid. $his should haveserved as a warnin! to :3CI that it could no lon!er deal with the propert in deference to the CourtQs rulin! and affir%ation of thetrial courtQs order to execute the deed of sale in favor of the Hentanillas. Oviousl, :3CI too6 no heed of this caveat. $he titles hadeen transferred et a!ain to the aerons, who clai%ed to e purchasers in !ood faith. ;nfortunatel, there was an exception tothe !eneral rule. $he C cited =( :utual Benefit ssociation Inc. v. antia!o,4where the Court ruled that with respect toinvoluntar liens, an entr of a notice of lev and attach%ent in the pri%ar entr or da oo6 of the 3e!istr of eeds wasconsidered as sufficient notice to all persons that the land was alread su0ect to attach%ent. 3esultantl, attach%ent was dulperfected and ound the land.

    $he (resent (etition

    !!rieved this C rulin!, the aerons filed the present petition. $he clai%ed that in 199@, a certain $i6s Bautista offered thelots to 3aul aeron, who, after ein! !iven photocopies of the titles to the land, in+uired with the 3e!istr of eeds for "ue#on Cit&3O2"C' to verif the authenticit of the sa%e. 5e found no encu%rances or annotations on the said titles, other than restrictionsfor construction and ne!otiation. s a!reed upon, he paid :ar+ue# the a%ount of $wo :illion One 5undred $housand (esos

    &(@,1**,***.**' as purchase price for the lots. ;pon pa%ent of the real propert taxes, a certification was issued the Office ofthe Cit $reasurer for the purpose of transferrin! the title over the propert.

    $hereafter, :ar+ue# executed the eed of solute ale in favor of the aerons. $he 3O2"C then issued $C$ 8os. /)14* and/)141 in their na%es.

    ;n6nown to the aerons, the for%er owner of the properties had entered into contracts to sell with the Hentanillas, wa ac6 in197*. It was onl upon receipt of the su%%ons in the case filed the Hentanillas with the 3$C that the learned of the presentcontrovers.

    ith the 3$C and the C rulin!s a!ainst their title over the properties, the aerons now co%e to the Court with their vehe%entinsistence that the were purchasers in !ood faith and for value. Before purchasin! the lots, the exercised due dili!ence and foundno encu%rance or annotations on the titles. t the sa%e ti%e, the Hentanillas also failed to reut the presu%ption of their !ood faithas there was no showin! that the confederated with :3CI and its officers to deprive the Hentanillas of their ri!ht over the su0ectproperties.

    ccordin! to the aerons, the C li6ewise erred in rulin! that there was no constructive notice of the lev %ade upon the su0ectlands. $he clai%ed that the appellate court could not solel rel on =( :utual Benefit ssociation Inc. v. antia!o.

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    controvers etween the aerons and the Hentanillas and @' that prior to the sale to the aerons, a notice of lev as anencu%rance was alread in existence.

    ections

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    $hese favorale findin!s pro%pted the Hentanillas to re!ister the notice of lev on the properties. $he records show that on thestren!th of a final and executor decision the Court, the successfull otained a writ of execution fro% the 3$C and a notice oflev was then entered, aleit on the pri%ar entr oo6 onl. $he contract to sell to :ar+ue# was re!istered on :a @1, 1991, whilethe notice of lev was issued ten &1*' das later, or on :a )1, 1991. In =eruar 199@, :3CI executed the eed of ale with:ar+ue#, under whose na%e the clean titles, sans the notice of lev, were issued. ear later, or on :arch 11, 199@, :3CIre!istered the deed of sale to :ar+ue# who later sold the sa%e propert to the aerons.

    $his co%plex situation could have een avoided if it were not for the failure of 3O Cleofe to carr over the notice of lev to

    :ar+ue#Qs title, servin! as a senior encu%rance that %i!ht have dissuaded the aerons fro% purchasin! the properties.

    $he Court a!rees with the position of the 3$C in re0ectin! 3O CleofeQs theor.

    istinctions etween a contract to sell and a contract of sale are well2estalished in urisprudence.-6+p!i-In a contract of sale, the title tothe propert passes to the vendee upon the deliver of the thin! sold in a contract to sell, ownership is, a!ree%ent, reserved inthe vendor and is not to pass to the vendee until full pa%ent of the purchase price. Otherwise stated, in a contract of sale, thevendor loses ownership over the propert and cannot recover it until and unless the contract is resolved or rescinded whereas, in acontract to sell, title is retained the vendor until full pa%ent of the price. In the latter contract, pa%ent of the price is a positivesuspensive condition, failure of which is not a reach ut an event that prevents the oli!ation of the vendor to conve title fro%eco%in! effective.11

    It is undeniale, therefore, that no title was transferred to :ar+ue# upon the annotation of the contract to sell on :3CIQs title. scorrectl found the trial court, the contract to sell cannot e sustituted the eed of solute ale as a %ere conclusion ofthe previous contract since the owners of the properties under the two instru%ents are different.1@

    Considerin! that the deed of sale in favor of :ar+ue# was of later re!istration, the notice of lev should have een carried over tothe title as a senior encu%rance.

    Corollar to this is the rule that a lev of a 0ud!%ent detor creates a lien, which nothin! can suse+uentl destro except the verdissolution of the attach%ent of the lev itself.1)(rior re!istration of the lien creates a preference, since the act of re!istration is theoperative act to conve and affect the land.14urisprudence dictates that the said lien continues until the det is paid, or the sale ishad under an execution issued on the 0ud!%ent or until the 0ud!%ent is satisfied, or the attach%ent is dischar!ed or vacated in thesa%e %anner provided law. ;nder no law, not even (.. 8o. 1

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    entered in the (ri%ar Entr Boo6, ut was not annotated on the $C$ ecause the ori!inal cop of the said title on file in the3e!istr of eeds was not availale at that ti%e. ix &/' das after the presentation of the 8otice of Lev, the eed of solute aleinvolvin! the sa%e parcel of land was presented for re!istration and li6ewise entered. $he deed of sale was exa%ined the sa%ee%ploee who exa%ined the notice of lev, ut she failed to notice that the title su0ect of the sale was the sa%e title which was thesu0ect of the notice of lev earlier presented. ;naware of the previous presentation of the notice of lev, the 3e!ister of eedsissued a certificate of title in the na%e of the vendee on the asis of the deed of sale. $he 3e!ister of eeds in =( i%%ediatelre+uested the vendee to surrender the docu%ents in li!ht of the %ista6e discovered so that he could ta6e appropriate rectification orcorrection. ettlin! the issue on whether the notice of lev could e annotated in the certificate of title, the Court ruled in the

    affir%ative on the !round that the preference created the lev on attach%ent was not di%inished the suse+uent re!istrationof the prior sale. uperiorit and preference in ri!hts were !iven to the re!istration of the lev on attach%ent althou!h the notice ofattach%ent had not een noted on the certificate of title, i ts notation in the oo6 of entr of the 3e!ister of eeds produced all theeffects which the law !ave to its re!istration or inscription, to witA

    W;nder the rule of notice, it is presu%ed that the purchaser has exa%ined ever instru%ent of record affectin! the title. uchpresu%ption is irreuttale. 5e is char!ed with notice of ever fact shown the record and is presu%ed to 6now ever fact shown the record and to 6now ever fact which an exa%ination of the record would have disclosed. $his presu%ption cannot eoverco%e proof of innocence or !ood faith. Otherwise, the ver purpose and o0ect of the law re+uirin! a record would edestroed. uch presu%ption cannot e defeated proof of want of 6nowled!e of what the record contains an %ore than one%a e per%itted to show that he was i!norant of the provi