Professional Documents
Culture Documents
Sales Case Digests PDF
Sales Case Digests PDF
PRINCIPLE/ DOCTRINE
Contract of Sale
That which where one of the contracting
parties obligates himself to transfer the
ownership of and to deliver a
determinate thing, and to pay there a
price certain in money or its equivalent.
(Art. 1458)
CASE TITLE
Dignos vs. CA
Digests
(Dean
Sundiang) |1
2B 2010-2011
CASE DETAILS
Facts: The Dignos spouses owned a parcel of land, which was sold to plaintiffappellant Jabil for the sum of P28,000 payable in two installments. Meanwhile,
the Dignos spouses sold the same land to Cabigas spouses. As the Dignos
spouses refused to accept the second payment and upon discovery of the
second sale, Jabil brought this suit.
Case
Petitioners contend that the Deed of Sale is a mere contract to sell and not an
absolute sale; that the same is subject to two positive conditions. It is further
contended that in said contract, title or ownership over the property was
expressly reserved in the vendor until the suspensive condition of full and
punctual payment of the balance of the purchase price shall have been met.
Thus, there is no actual sale until full payment is made.
Reviewer:
Facts: Spouses Artates and Pojas sought the annulment of the execution of a
homestead issued and duly registered in their names. A public sale was made to
satisfy a judgment against Artates, which amount was awarded to Urbi for
physical injuries. Plaintiff spouses alleged that said sale violated the provision of
the Public Land Law exempting said property from execution from any debt
contracted within the five-year period from the date of the issuance of the
patent.
Issue: WON the execution sale is valid.
Ruling: The execution sale is null and void. As thus prescribed by law, for a
period of five years from the date of the government grant, lands acquired by
free or homestead patent shall not only be incapable of being encumbered or
alienated in favour of the government itself or any of its institutions or of duly
constituted banking corporations, but also, they shall not be liable to the
satisfaction of any debt contracted within the said period, whether or not the
indebtedness shall mature during or after the prohibited time. This provision is
mandatory and a sale made in violation thereof is null and void and produces no
effect.
Though it may be a limitation on the right of ownership of the grantee, the
salutary purpose of the provision is to preserve and keep for the homesteader or
his family the land given to him gratuitously by the State, so that being a
property owner, he may become and remain a contented and useful member of
Sales
Heirs of Enrique
Zambales vs. CA
Reviewer:
Case
Digests
(Dean
Sundiang) |2
2B 2010-2011
the society.
Facts: The Zambales spouses were the homestead patentees of a parcel of land.
Claiming that the Nin Bay Mining Corp. had removed silica sand from their land
and destroyed the plants and other improvements therein, they instituted a case
claiming for damages. The Zambales spouses entered into a Compromise
Agreement with the Corporation; by virtue of which, the disputed property was
sold to one Preysley. Ten years after the Trial Courts decision based on the
Compromise Agreement and nine years after the sale, the Zambales spouses
filed a civil case for annulment of the Deed of Sale with recovery of possession
and ownership with damages, contending that it was their lawyer who prevailed
upon them to sign the Compromise Agreement; that they wer unschooled and
did not understand the contents thereof.
Issue: WON the Compromise Agreement violates the alienation and
encumbrance of a homestead lot within five years from the issuance of the
patent.
Ruling: The sale is void. The law does not distinguish between executor and
consummated sales. The bilateral promise to buy and sell the homestead lot at a
price certain, which was reciprocally demandable, was entered into within the
five-year prohibitory period and is therefore, illegal and void. To all interests and
purposes, therefore, there was an actual executory sale perfected during the
period of prohibition except that it was reciprocally demandable thereafter and
the agency to sell to any third person was deferred until after the expiration of
the prohibitory period, and the agency to sell made effective only after the lapse
of the said period, was merely a devise to circumvent the prohibition.
Agency to Sell
The agent delivers
the price which he
turn he got from his
buyer.
The agent who is
supposed to sell does
not
become
the
owner, even if the
property has been
delivered to him.
The agent who sells
assumes no personal
liability as long as he
acts
within
his
The bilateral promise to buy and sell and the agency to sell entered into within
five years from the date of the homestead patent was in violation of the Public
Land Law, although the executed sale was deferred until after the expiration of
the five-year prohibitory period.
Facts: A contract was entered into by and between Quiroga and Parsons for the
exclusive sale of Quiroga beds in the Visayan Islands. The tenor of said contract
provides that Quiroga shall furnish beds of his manufacture to Parsons for the
latters establishment in Iloilo, and shall invoice them at the same price he fixed
for sales in Manila, and in the invoices, shall make an allowance of a discount as
commission on the sales; and Parsons shall order the beds by the dozen,
whether of the same or different styles. Parsons further binds himself to pay
Quiroga for the beds received within 60 days from the date of their shipment,
and binds himself not to sell any other kind except Quiroga beds.
Quiroga contends that Parsons violated the following obligations: not to sell beds
at higher prices than those of the invoices, to have an open establishment in
Iloilo; to conduct the agency, to keep the beds on public exhibition, and to pay
for the advertisement expenses for the same, and to order the beds by the
dozen and in no other manner. He further alleged that Parsons was his agent for
the sale in Iloilo, and said obligations are implied in a contract of commercial
agency.
Sales
Reviewer:
Case
Digests
(Dean
Sundiang) |3
2B 2010-2011
Concrete Aggregates
vs. CTA
Sales
Peoples Homesite
and Housing Corp.
vs. CTA
certain,
definite
and
intentional(Art.1319)
When the sale is subject to a suspensive
condition: from the moment the
condition is fulfilled.
Reviewer:
Case
Digests
(Dean
Sundiang) |4
2B 2010-2011
Facts: The PHHC board of directors passed Resolution No. 513 awarding to
Spouses Mendoza the Consolidation Subdivision Plan on Lot 4 subject to the
approval of the Quezon City Council. The city council disapproved the said
proposed plan. However approval was made by the said council upon submission
of a revised plan reducing the land area. Later on, PHHC board of directors
passed another resolution withdrawing the tentative award to the Mendoza
-spouses who never paid the price of the lot nor made the 20% initial deposit.
The spouses contend that there was a perfected sale of Lot 4 thus they can
enforce against the PHHC an action for specific performance.
Issue: WON there was a perfected contract of sale.
Sales
Limketkai Sons
Milling, Inc. vs. CA
Reviewer:
Case
Digests
(Dean
Sundiang) |5
2B 2010-2011
events. It follows that the VSP created no demandable right in favor of Sosa for
the delivery of the vehicle to him, and its non-delivery did not cause any legally
indemnifiable injury.
Facts: Philippine Remnants Co., Inc. constituted BPI as its trustee to manage,
administer, and sell its real estate property. BPI gave Revilla the formal
authority, to sell the lot for P1,000.00 per square meter. Revilla contacted
Limketkai Sons Milling who agreed to buy the land. There were negotiatons on
the price and the term of payment between BPI and the Limketkai until
agreement has been reached. BPI later on refused the payment tendered by the
petitioner and sold the property to NBS instead.
Issue: WON there was a meeting of mind between Limketkai and BPI.
Southwestern Sugar
& Molasses Co. vs.
Atlantic Gulf &
Pacific Company
June 1955
Ruling: There was a perfected contract of sale between Limketkai and BPI. The
negotiation or preparation stage started with the authority given by Philippine
Remnants to BPI to sell the lot, followed by (a) the authority given by BPI and
confirmed by Philippine Remnants to broker Revilla to sell the property, (b) the
offer to sell to Limketkai, (c) the inspection of the property and finally (d) the
negotiations with Aromin and Albano at the BPI offices.
The perfection of the contract took place when Aromin and Albano, acting
for BPI, agreed to sell and Alfonso Lim with Albino Limketkai, acting for petitioner
Limketkai, agreed to buy the disputed lot at P1,000.00 per square meter. Aside
from this there was the earlier agreement between petitioner and the authorized
broker. There was a concurrence of offer and acceptance, on the object, and on
the cause thereof.
Consent is manifested by the meeting of the offer and the
acceptance upon the thing and the cause which are to constitute the
contract. The offer must be certain and the acceptance absolute. So
long as it is clear that the meaning of the acceptance is positively and
unequivocally to accept the offer, whether such request is granted or
not, a contract is formed.
Facts: On March 24, 1953, Atlantic granted Southwestern an option period to
buy the formers barge. On May 11 of the same year, Southwestern Company
communicated its acceptance of the option to Atlantic. The latter replied that
their understanding was that the "offer of option" is to be a cash transaction and
to be effected "at the time the lighter is available." On June 25, Atlantic advised
the Southwestern Company that the barge could not be turned over to the latter
company.
On June 27, 1953, the Southwestern Company filed this action to compel Atlantic
to sell the barge in line with the option, depositing with the court a check
covering the amount, but said check was later withdrawn with the approval of
the court. On June 29, the Atlantic withdrew its "offer of option" with due notices
to Southwestern Company. The Atlantic contended that the option to sell it made
to Southwestern Company is null and void because said option to sell is not
supported by any consideration.
Sales
Reviewer:
Case
Digests
(Dean
Sundiang) |6
2B 2010-2011
Issue: Whether or not the option to sell made to Southwestern Company is null
and void because said option to sell is not supported by any consideration.
Ruling: The Supreme Court reversed the trial courts decision applying Article
1479 of the new Civil Code. The Court reiterated that "an accepted unilateral
promise" can only have a binding effect if supported by a consideration, which
means that the option can still be withdrawn, even if accepted, if said option is
not supported by any consideration. The option that Atlantic had provided was
without consideration, hence, can be withdrawn notwithstanding Southwestern
Companys acceptance of said option.
Facts: On September 13, 1951, Atkins Kroll & Co. (Atkins) sent a letter to Cu
Hian Tek (Hian Tek) offering to sell sardines with corresponding quantity. Hian
Tek unconditionally accepted the said offer through a letter, but Atkins failed to
deliver the commodities due to the shortage of catch of sardines by the packers
in California.
Hian Tek, filed an action for damages in the CFI of Manila which granted the
same in his favor. Upon Atkins appeal, the Court of Appeals affirmed said
decision.
Issue: WON there was a contract of sale between the parties or only a unilateral
promise to buy
Ruling: The Supreme Court held that there was a contract of sale between the
parties. Petitioners argument assumed that only a unilateral promise arose
when the respondent accepted the offer, which is incorrect because a bilateral
contract to sell and to buy was created upon respondents acceptance.
After accepting the promise and before he exercises his option, the holder of the
option is not bound to buy. In this case at bar, however, upon respondents
acceptance of herein petitioner's offer, a bilateral promise to sell and to buy
ensued, and the respondent had immediately assumed the obligations of a
purchaser.
Facts: In an instrument entitled "Option to Purchase," executed on April 3, 1961,
Severina Rigos "agreed, promised and committed ... to sell" to plaintiff-appellee
Nicolas Sanchez for the sum of P1,510.00 within two (2) years from said date, a
parcel of land situated in Nueva Ecija. It was agreed that said option shall be
deemed "terminated and elapsed," if Sanchez shall fail to exercise his right to
buy the property" within the stipulated period. On March 12, 1963, Sanchez
deposited the sum of P1,510.00 with the CFI of Nueva Ecija and filed an action
for specific performance and damages against Rigos for the latters refusal to
accept several tenders of payment that Sanchez made to purchase the subject
land.
Sales
Reviewer:
Case
Digests
(Dean
Sundiang) |7
2B 2010-2011
Issue: WON there was a contract to buy and sell between the parties or only a
unilateral promise to sell
Ruling: The Supreme Court affirmed the lower courts decision. The instrument
executed in 1961 is not a "contract to buy and sell," but merely granted plaintiff
an "option" to buy, as indicated by its own title "Option to Purchase." The lower
court relied upon Article 1354 of the Civil Code when it presumed the existence
of said consideration, but the said Article only applies to contracts in general.
However, it is not Article 1354 but the Article 1479 of the same Code which is
controlling in the case at bar because the latters 2nd paragraph refers to "sales"
in particular, and, more specifically, to "an accepted unilateral promise to buy or
to sell." Since there may be no valid contract without a cause or consideration,
the promisor is not bound by his promise and may, accordingly, withdraw it.
Pending notice of its withdrawal, his accepted promise partakes, however, of the
nature of an offer to sell which, if accepted, results in a perfected contract of
sale.
Facts: On 12 October 1970, petitioners executed a real estate mortgage in favor
of respondent bank. Petitioners failed to pay the loan on due date. The bank
applied for the extrajudicial foreclosure of the mortgage. At the foreclosure sale,
the respondent bank was the highest and winning bidder. A certificate of sale
was executed in its favor by the sheriff and the same was registered with the
Office of the Register of Deeds. The certificate of sale expressly provided that
the redemption period shall be two years from the registration thereof.
No redemption was made by petitioners within the two-year period and the
sheriff issued a Final Deed of Sale.
Issue: WON the petitioners were given an extension of the period of redemption.
Ruling: We find the petition to be devoid of merit. The attempts to redeem the
property were done after the expiration of the redemption period and that no
extension of that period was granted to petitioners.
Even if the President and Manager of the bank is to be understood to have
promised to allow the petitioners to buy the property at any time they have the
money, the Bank was not bound by the promise not only because it was not
approved or ratified by the Board of Directors but also because, and more
decisively, it was a promise unsupported by a consideration distinct from the repurchase price.
The second paragraph of Article 1479 of the Civil Code expressly provides:
An accepted unilateral promise to buy or to sell a determinate thing for a price
certain is binding upon the promissory if the promise is supported by a
consideration distinct from the price.
WHEREFORE, the instant petition is DISMISSED, with costs against the
Petitioners.
Facts: In between the 13th to the 23d of June, 1904, petitioner Pedro Roman,
the owner, and respondent Andres Grimalt, the purchaser, verbally agreed upon
the sale of the schooner Santa Marina. In his letter on June 23, Grimalt agreed to
Sales
1.
3.
4.
Case
Digests
(Dean
Sundiang) |8
2B 2010-2011
buy the vessel and offered to pay in three installments of P500 each on July 15,
September 15, and November 15, provided the title papers to the vessel were in
proper form. The title of the vessel, however, was in the name of one Paulina
Giron and not in the name of Roman as the alleged owner. Roman promised to
perfect his title to the vessel, but failed so the papers he presented did not show
that he was the owner of the vessel. On June 25, 1904, the vessel sank in the
Manila harbor during a severe storm, even before Roman was able to produce for
Grimalt the proper papers showing that the former was in fact the owner of the
vessel in question and not Paulina Giron. As a result, Grimalt refused to pay the
purchase price when Roman made a demand on June 30, 1904.
On July 2, 1904, Roman filed this complaint in the CFI of Manila, which found
that the parties had not arrived at a definite understanding, and later dismissed
said complaint.
2.
Reviewer:
Norkis Distributors,
In.c vs. CA
Ruling: The Supreme Court affirmed the decision of the lower court and
declared Roman as the one who should bear the risk of lost because there was
no actual contract of sale. If no contract of sale was actually executed by the
parties, the loss of the vessel must be borne by its owner and not by a party who
only intended to purchase it and who was unable to do so on account of failure
on the part of the owner to show proper title to the vessel and thus enable them
to draw up the contract of sale. Grimalt was under no obligation to pay the price
of the vessel, the purchase of which had not been concluded. The conversations
between the parties and the letter Grimalt had written to Roman did not
establish a contract sufficient in itself to create reciprocal rights between the
parties.
Facts: Petitioner Norkis Distributors, Inc. (Norkis for brevity), is the distributor of
Yamaha motorcycles in Negros Occidental with office in Bacolod City with
Avelino Labajo as its Branch Manager. On September 20, 1979, private
respondent Alberto Nepales bought from the Norkis-Bacolod branch a brand new
Yamaha Wonderbike motorcycle Model YL2DX with Engine No. L2-329401K
Frame No. NL2-0329401, Color Maroon, then displayed in the Norkis showroom.
The price of P7,500.00 was payable by means of a Letter of Guaranty from the
Development Bank of the Philippines (DBP), Kabankalan Branch, which Norkis'
Branch Manager Labajo agreed to accept. Hence, credit was extended to
Nepales for the price of the motorcycle payable by DBP upon release of his
motorcycle loan. As security for the loan, Nepales would execute a chattel
mortgage on the motorcycle in favor of DBP. Branch Manager Labajo issued
Norkis Sales Invoice No. 0120 (Exh.1) showing that the contract of sale of the
motorcycle had been perfected. Nepales signed the sales invoice to signify his
conformity with the terms of the sale. In the meantime, however, the motorcycle
remained in Norkis' possession.On November 6, 1979, the motorcycle was
registered in the Land Transportation Commission in the name of Alberto
Nepales.
Issue: Who should bear the loss of the motorcycle?
Sales
Serra vs .CA
Reviewer:
Case
Digests
(Dean
Sundiang) |9
2B 2010-2011
Ruling: NORKIS, the seller. The issuance of a sales invoice does not prove
transfer of ownership of the thing sold to the buyer. An invoice is nothing more
than a detailed statement of the nature, quantity and cost of the thing sold and
has been considered not a bill of sale. In all forms of delivery, it is necessary that
the act of delivery whether constructive or actual, be coupled with the intention
of delivering the thing. The act, without the intention, is insufficient.
When the motorcycle was registered by Norkis in the name of private
respondent, Norkis did not intend yet to transfer the title or ownership to
Nepales, but only to facilitate the execution of a chattel mortgage in favor of the
DBP for the release of the buyer's motorcycle loan. The Letter of Guarantee
issued by the DBP, reveals that the execution in its favor of a chattel mortgage
over the purchased vehicle is a pre-requisite for the approval of the buyer's loan.
If Norkis would not accede to that arrangement, DBP would not approve private
respondent's loan application and, consequently, there would be no sale.
In other words, the critical factor in the different modes of effecting delivery,
which gives legal effect to the act, is the actual intention of the vendor to
deliver, and its acceptance by the vendee. Without that intention, there is no
tradition.
Article 1496 of the Civil Code which provides that "in the absence of an express
assumption of risk by the buyer, the things sold remain at seller's risk until the
ownership thereof is transferred to the buyer," is applicable to this case, for
there was neither an actual nor constructive delivery of the thing sold, hence,
the risk of loss should be borne by the seller, Norkis, which was still the owner
and possessor of the motorcycle when it was wrecked. This is in accordance with
the well-known doctrine of res perit domino.
Facts: Petitioner is the owner of a 374 square meter parcel of land located at
Quezon St., Masbate, Masbate. Sometime in 1975, respondent bank, in its desire
to put up a branch in Masbate, Masbate, negotiated with petitioner for the
purchase of the then unregistered property. A contract of LEASE WITH OPTION
TO BUY was instead forged by the parties. The foregoing agreement was
subscribed before Notary Public Romeo F. Natividad. Pursuant to said contract, a
building and other improvements were constructed on the land which housed
the branch office of RCBC in Masbate, Masbate. Within three years from the
signing of the contract, petitioner complied with his part of the agreement by
having the property registered and placed under the TORRENS SYSTEM, for
which Original Certificate of Title No. 0-232 was issued by the Register of Deeds
of the Province of Masbate.
Petitioner alleges that as soon as he had the property registered, he kept on
pursuing the manager of the branch to effect the sale of the lot as per their
agreement. It was not until September 4, 1984, however, when the respondent
bank decided to exercise its option and informed petitioner, through a letter, of
its intention to buy the property at the agreed price of not greater than P210.00
per square meter or a total of P78,430.00. But much to the surprise of the
respondent, petitioner replied that he is no longer selling the property.
Issue: WON the contract lease with option to buy is valid.
Sales
Digests
(Dean
S u n d i a n g ) | 10
2B 2010-2011
In the present case, the consideration is even more onerous on the part of the
lessee since it entails transferring of the building and/or improvements on the
property to petitioner, should respondent bank fail to exercise its option within
the period stipulated. The bugging question then is whether the price "not
greater than TWO HUNDRED PESOS" is certain or definite.
Case
Ruling: YES. The contract lease with option to buy is valid , effective and
enforceable, the price being certain and that there was consideration distinct
from the price to support the option given to lessee.
Article 1324 of the Civil Code provides that when an offeror has allowed the
offeree a certain period to accept, the offer maybe withdrawn at anytime before
acceptance by communicating such withdrawal, except when the option is
founded upon consideration, as something paid or promised. On the other hand,
Article 1479 of the Code provides that an accepted unilateral promise to buy and
sell a determinate thing for a price certain is binding upon the promisor if the
promise is supported by a consideration distinct from the price.
In a unilateral promise to sell, where the debtor fails to withdraw the promise
before the acceptance by the creditor, the transaction becomes a bilateral
contract to sell and to buy, because upon acceptance by the creditor of the offer
to sell by the debtor, there is already a meeting of the minds of the parties as to
the thing which is determinate and the price which is certain. In which case, the
parties may then reciprocally demand performance.
Jurisprudence has taught us that an optional contract is a privilege existing only
in one party the buyer. For a separate consideration paid, he is given the right
to decide to purchase or not, a certain merchandise or property, at any time
within the agreed period, at a fixed price. This being his prerogative, he may not
be compelled to exercise the option to buy before the time
expires.
Option Contract
A contract made to keep an offer open
for a specified period, so that the offer
cannot be revoked by the offeror during
that period.
Option is valid because it is supported
by a consideration.
Here, the buyer cannot be compelled to
buy.
Reviewer:
Sales
2.
3.
Reviewer:
Case
Digests
(Dean
S u n d i a n g ) | 11
2B 2010-2011
Sales
BUT:
If not for the waiver, Filinvest though a
financing institution, is not immune from any
recourse by the private respondents.
article
shall
be
applied
to
(Dean
S u n d i a n g ) | 12
2B 2010-2011
The mortgage creditor may recover judgment on the mortgage debt and cause
an execution on the mortgaged property and may cause an attachment to be
issued and levied on such property, upon beginning his civil action.
Facts: Spouses Torres executed a real estate mortgage on two parcel of land to
secure the payment of the indebtedness of PDP Transit, Inc. for the purchase of
five (5) Mercedes Benz trucks from Universal Motors Corp.
Separate deeds of chattel mortgages on the Mercedez Benz units were also
executed by PDP Transit in favor of UMC
Article 1485.
The preceding
Digests
UMC contends (on appeal) that what Article 1484 withholds from the vendor is
the right to recover any deficiency from the purchaser after the foreclosure of
the chattel mortgage and not a recourse to the additional security put up by a
third party to guarantee the purchaser's performance of his obligation
Case
PDP Transit Inc. was able to pay a sum of P92,964.91, leaving balance of
P68,641.69 including interest due as of February 8, 1965
On March 19, 1965, Universal Motors Corporation filed a complaint against PDP
Transit, and it was able to repossess all the units sold, including the five (5) units
guaranteed by the subject real estate mortgage, and to foreclose all the chattel
mortgages constituted thereon, resulting in the sale of the trucks at public
auction.
Spouses Lorenzo Pascual and Leonila Torres filed an action in the CFI Quezon
City for the cancellation of the mortgage. A judgment was rendered in their
favor.
Reviewer:
Ruling: NO. if the guarantor should be compelled to pay the balance of the
purchase price, the guarantor will in turn be entitled to recover what she has
paid from the debtor vendee (Art. 2066, Civil Code); so that ultimately, it will be
the vendee who will be made to bear the payment of the balance of the price,
despite the earlier foreclosure of the chattel mortgage given by him.
Thus, the protection given by Article 1484 would be indirectly subverted, and
public policy overturned."
Facts: Spouses Tan sells gravel produced from crushed rocks used for
construction purposes. Wanting to increase production, they asked Mr. Ruben
Mercurio to look for a more efficient rock crusher and were referred to Rizal
Consolidated Corporation which then had for sale one such machinery.
After inspection of said machinery, couple decided to buy the same and applied
for financial assistance from Filinvest Credit Corporation on the conditions that:
that the machinery be purchased in the petitioner's name;
that it be leased (with option to purchase upon the termination of the lease
period) to the private respondents; and
that the private respondents execute a real estate mortgage in favor of the
petitioner as security for the amount advanced by the latter.
Sales
Reviewer:
Case
Digests
(Dean
S u n d i a n g ) | 13
2B 2010-2011
Sales
Reviewer:
Case
Digests
(Dean
S u n d i a n g ) | 14
2B 2010-2011
Sales
Reviewer:
Case
Digests
(Dean
S u n d i a n g ) | 15
2B 2010-2011
are opposed by the interposition of another will, then fiction yields to reality
the delivery has not been effected.
Art. 1477. The ownership of the thing sold
shall be transferred to the vendee upon the
actual or constructive delivery thereof. (n)
Sampaguita Pictures
vs. Jalwindor
Facts: Sampaguita leased to Capitol 300 Inc. the roof deck of its building with
the agreement that all permanent improvements Capitol will make on said
property shall belong to Sampaguita without any part on the latter to reimburse
Capitol for the expenses of said improvements.
Shortly, Capitol purchased on credit from Jalwindor glass and wooden jalousies,
which the latter itself delivered and installed in the leased premises, replacing
the existing windows
. Jalwindor filed with the CFI of Rizal, Quezon City an action for collection of a
sum of money with a petition for preliminary attachment against Capitol for its
failure to pay its purchases. Later, Jalwindor and Capitol submitted to the trial
court a Compromised Agreement wherein Capitol acknowledged its indebtedness
and that all the materials that Capitol purchased will be considered as security
for such undertaking. Meanwhile, Sampaguita filed a complaint for ejectment
and for collection of a sum of money against Capitol for the latters failure to pay
rentals and the City Court of Quezon City ordered Capitol to vacate the premises
and
to
pay
Sampaguita.
On the other hand, Capitol likewise failed to comply with the terms of the
Compromise Agreement, and a levy was made on the glass and wooden
jalousies. Sampaguita filed a third-party claim alleging that it is the owner of said
materials and not Capitol, but Jalwindor filed an idemnity bond in favor of the
Sheriff and the items were sold at public auction, with Jalwindor as the highest
bidder . Sampaguita filed with the CFI of Rizal, Quezon City an action to nullify
the Sheriff's sale and for an injunction to prevent Jalwindor from detaching the
glass and wooden jalousies.
Issue: WON there was a delivery made and, therefore, a transfer of ownership of
the
thing
sold?
Ruling: YES. When the glass and wooden jealousies were delivered and
installed in the lease premises, Capitol became the owner thereof. Ownership is
not transferred by perfection of the contract but by delivery, either actual or
constructive.
Article 1491
Par. 2 thereof; Agents cannot acquire the
property whose administration or sale may have
been intrusted to them, unless the consent of
the principal has been given.
The rule,
however, does not apply to mortgagee
purchasing the mortgaged property at a public
Fiestan vs. CA
Capitol entered into a lease contract with Sampaguita, and the latter became the
owner of the items mentioned by virtue of the contract agreement. When levy
was made on the items, Capitol ( the judgment debtor) was no longer the owner
thereof.
Facts: Spouses Fiestan mortgaged their land to DBP as security for a loan. Upon
failure to pay, the land was foreclosed an. DBP acquired lot as highest bidder.
One year redemption period having expired, DBP title over the land was
consolidated.
Issue: WON DBP is prohibited to acquire the property under Art. 1491(2)?
Sales
sale.
Reviewer:
Case
Digests
(Dean
S u n d i a n g ) | 16
2B 2010-2011
Ruling: NO. The prohibition does not apply in the instant case where the sale in
dispute was made pursuant to a special power inserted in or attached to the real
estate under Act No. 3135 as amended. As special statute, Act 3135 prevails
over provisions of Civil Code as general statute. Moreover, even in the absence
of such provision, the mortgagee may still purchase the subject property to
protect his interest.
Facts: Respondent Suntay delivered a diamond ring to certain Clarita Sison for
the latter to sell it on commission. Time lapses and there was no return of the
ring nor the purchase price. Demand was made and later Sison was found out to
have pledged it to petitioner Dizon. Suntay thereafter filed for the recovery of
the thing. Lower and appellate courts found in her favor under Art 559 as owner
thereof. Hence this petition.
Issue: May Suntay still recover possession of the thing pledged?
Ruling: YES. Suntay may recover the diamond ring from the pawnshop with
which another person has pledged it without authority to do so. Art 559 applies
and the defense that the pawnshop acquired possession of the ring without
notice of any defect in the title of the pledge is unavailing. Since the thing was
pledged by a pledgor having no authority to do so, the real owner is not stopped
from pursuing an action against the pawnshop for the recovery of the possession
of the thing. Petitioner is engaged in the business where presumably ordinary
prudence would manifest itself to ascertain whether or not the individual offering
jewelry by way of pledge is entitled to do so. No such precaution was exercised
by petitioner. He, therefore, has only himself to blame for the fix he is now.
Facts: A person identifying himself as Joe Cruz placed an order by telephone
with EDCA Publishing & Distributing Co. for 406 books payable on delivery.
Books were delivered for which Cruz issued a personal check as payment. Cruz
was later found out to be an impostor and the check issued was dishonored after
its presentation for payment. EDCA, after knowing that the said books were
subsequently sold to Leonor Santos, asked help of the police to seize the books
without warrant claiming it was unlawfully deprived of the books.
Issue: WON EDCA was unlawfully deprived of the books since the check issued
was dishonored?
Double Sale
Rules of preference in case of double sale:
1. Personal Property- possessor in good
faith
Carbonell vs. CA
Sales
2.
Reviewer:
Case
Digests
(Dean
S u n d i a n g ) | 17
2B 2010-2011
allowed to live on the lot provided it will pay rents. Thereafter, Poncio sold the lot
to Emma Infante who immediately took possession of the lot and built
improvements thereon. Informed that the sale to Infante was not registered,
Carbonell registered her adverse claim on Feb 8, 1955. Four days after, a deed
of sale in favor of Infante was registered.
Issue: Who has a better right on the question lot?
Tanedo vs. CA
Facts: Lazaro Tanedo executed a deed of absolute sale in favor of his eldest
brother, Ricardo Tanedo and the latters wife where he conveyed his future
inheritance from his parents. Later, Ricardo discovered that the land in litigation
was sold to Lazaros children through another deed of sale which was recorded in
the Register of Deeds; the heirs of Lazaro wanted to have the rescission of the
deeds in favor of Ricardo.
Issue: WON the second sale and the act of registration are valid.
Ruling: Yes. In addition, applying 1544 of the NCC, the petitioners (heirs of
Lazaro) also have a better right over the land, because under the said provision,
ownership shall belong to the buyer who in good faith registers it first it in the
Registry of Property.
Radiowealth Finance
Company vs. Palileo
Sales
c.
Reviewer:
Case
Digests
(Dean
S u n d i a n g ) | 18
2B 2010-2011
Held: No. Apply Sec. 35, Rule 39 of the Revised Rules of Court instead. The
Court explained that the purchaser of an unregistered land in a sheriffs
execution sale only steps in the shoes of the judgment debtor.
Spouses Gabriel vs.
Mabanta
Facts: Mabanta spouses were the registered owners of two lots. They
mortgaged the said properties to DBP as collateral. Later, the spouses sold the
land to Susana Soriano (Deed of sale of parcels of land with assumption of
mortgage) with a right to repurchase; they failed to buy it back. Susana
executed a document entitled "Cancellation of Contract" whereby she
transferred to Alejandro all her rights over the two lots. Alejandro and his son
Alfredo cultivated the lots. However, when they were ready to pay the entire
loan, they found that Tans daughter already bought the land.
Issue: WON the Tan-Reyes is in good faith when she bought and registered the
land.
Ruling: No. Good faith is something internal; hence, we must rely on the
conduct and outward acts of Tan-Reyes. Good faith must concur with
registration.
Consolidated Rural
Bank va. CA
Facts: The Madrid brothers were the registered owners of a lot. It was
subdivided. Rizal Madrid sold part of his share to Aleja Gamiao and Felisa Dayag
by virtue of a Deed of Sale. The sale was not registered; however, Gamiao and
Dayag declared the property for taxation purposes. A part of the land was sold to
Hernandez and dela Cruz and the heirs of the latter continued possession. The
Madrid brothers sold the same land to Marquez. The sale was registered.
Marquez mortgaged the land; these were registered. The land was foreclosed
and was sold to Calixto. The heirs of dela Cruz filed a case for reconveyance.
Issue: WON 1544 would apply.
Held: No, 1544 cannot be invoked where two persons made the sale. Apply the
principle of prior tempore, potior jure. The Heirs have a superior right.
Facts: Hanopol claims ownership over the land by virtue of a series of purchases
by means of private documents from the Siapos. Pilapil asserts his right on the
strength of a duly notarized deed executed by the owners executed in his favor
and registered under Act. No. 3344.
Issue: WON the registration of the second sale in favor of Pilapil affects
Hanopols rights as the first vendee.
Held: Yes. The better right referred to in Act No. 3344 is more than a mere prior
deed. It involves facts and circumstances which combined, would make it clear
Sales
Reviewer:
Case
Digests
(Dean
S u n d i a n g ) | 19
2B 2010-2011
that the first buyer has a better right than the second purchaser. There seems to
be no clear evidence of Hanopols possession of the land. Hanopol cannot have a
better right than Pilapil who, according to the Trial Court was not a purchaser in
bad faith.