This case involves a contract to sell real property between Patricio Pagtalunan and Rufina Manzano. The contract provided that Manzano would pay P17,000 for the property in monthly installments of P150, and that if any installment was unpaid for 90 days, the contract would be automatically rescinded without need for judicial declaration. Pagtalunan demanded rescission of the contract due to unpaid installments. The Supreme Court ruled that actual cancellation requires (1) a notarial act of rescission and (2) refund of payments to the buyer, and only takes effect 30 days after receipt by the buyer of the notice and refund. Mere demand for rescission by the seller is not
This case involves a contract to sell real property between Patricio Pagtalunan and Rufina Manzano. The contract provided that Manzano would pay P17,000 for the property in monthly installments of P150, and that if any installment was unpaid for 90 days, the contract would be automatically rescinded without need for judicial declaration. Pagtalunan demanded rescission of the contract due to unpaid installments. The Supreme Court ruled that actual cancellation requires (1) a notarial act of rescission and (2) refund of payments to the buyer, and only takes effect 30 days after receipt by the buyer of the notice and refund. Mere demand for rescission by the seller is not
This case involves a contract to sell real property between Patricio Pagtalunan and Rufina Manzano. The contract provided that Manzano would pay P17,000 for the property in monthly installments of P150, and that if any installment was unpaid for 90 days, the contract would be automatically rescinded without need for judicial declaration. Pagtalunan demanded rescission of the contract due to unpaid installments. The Supreme Court ruled that actual cancellation requires (1) a notarial act of rescission and (2) refund of payments to the buyer, and only takes effect 30 days after receipt by the buyer of the notice and refund. Mere demand for rescission by the seller is not
AEROSPACE CHEMICAL Vs CA 69. ELISCO TOOL MFG CORP vs. CAGR No. 109966, g.r.no. 108129 September 23, 1999 May31, 1999 FACTS: On June 27, 1986, petitioner Aerospace Industries, FACTS: Private respondent Rolando Lantan entered into an Inc. (Aerospace) purchased five hundred (500) metric tons of sulfuric acid from private respondent Philippine Phosphate agreement with his employer, herein petitioner, leasing unto Fertilizer Corporation (Philphos). Initially set beginning July the former a Colt lancer from a period of 5 years. The contract 1986, the agreement provided that the buyer shall pay its also provided that at the end of the 5 year period, Lantan may purchases in equivalent Philippine currency value, five days exercise the option to purchase price of the car and he should prior to the shipment date. Petitioner as buyer committed to just pay the remaining balance. Said option is limited to the secure the means of transport to pick-up the purchases from employee. It also provided that upon Lantan’s failure to pay 3 private respondent's loadports. Per agreement, one hundred accumulated monthly rentals, the petitioner will have the option metric tons (100 MT) of sulfuric acid should be taken from Basay, Negros Oriental storage tank, while the remaining four to lease said vehicle to another. Lantan also has to return the hundred metric tons (400 MT) should be retrieved from Sangi, car in case he resigns or is dismissed. He was laid off after Cebu. On December 18, 1986, M/T Sultan Kayumanggi petitioner ceased operations in 1981. At that time, he has paid docked at Sangi, Cebu, but withdrew only 157.51 MT of P61, 070.94. Petitioner then filed a replevin casea gainst sulfuric acid. Again, the vessel tilted. Further loading was Lantan and his wife, alleging that they have failed to pay the aborted. Two survey reports conducted by the Societe monthly rentals despite repeated demands. Generale de Surveillance (SGS) Far East Limited, dated December 17, 1986 and January 2, 1987, attested to these occurrences. Later, on a date not specified in the record, M/T The trial court sustained private respondents’ claim that the Sultan Kayumanggi sank with a total of 227.51 MT of sulfuric agreement in question was one of acid on board. Petitioner chartered another vessel, M/T Don Victor, with a capacity of approximately 500 MT.6 [TSN, sale and held that the latter had fully paid the price of the car September 1, 1989, pp. 28-29.] On January 26 and March 20, having paid the total amount of P61,070.94aside from installing 1987, Melecio Hernandez, acting for the petitioner, addressed accessories in the car worth P15,000.00. Petitioner appealed letters to private respondent, concerning additional orders of with the CA which affirmed the decision of the trial court in toto. sulfuric acid to replace its sunken purchases. ISSUE: WON the agreement between the parties is one of ISSUE: Should expenses for the storage and preservation of sale. the purchased fungible goods, namely sulfuric acid, be on seller's account pursuant to Article 1504 of the Civil Code? RULING :Although the agreement provides for the payment by RULING: Petitioner tries to exempt itself from paying rental Lantan of monthly rentals, the fifth paragraph thereof gives expenses and other damages by arguing that expenses for the them the option to purchase the motor vehicle at the end of the preservation of fungible goods must be assumed by the seller. fifth year or upon payment of the 60th monthly rental when all Rental expenses of storing sulfuric acid should be at private monthly rentals shall be applied to the payment of the full respondent's account until ownership is transferred, according purchase price of the car. Clearly, the transaction is a lease in to petitioner. However, the general rule that before delivery, the risk of loss is borne by the seller who is still the owner, is not name only. The so-called monthly rentals are in truth monthly applicable in this case because petitioner had incurred delay in amortizations on the cars price. Being a contract of sale on the performance of its obligation. Article 1504 of the Civil Code installment, Articles 1484 and 1485 apply. As such, the case clearly states: "Unless otherwise agreed, the goods remain at should be considered as one for specific performance pursuant the seller's risk until the ownership therein is transferred to the to Article 1484 (1). The remedies provided for in Art.1484 are buyer, but when the ownership therein is transferred to the alternative, not cumulative. The exercise of one bars the buyer the goods are at the buyer's risk whether actual delivery exercise of the others. This limitation applies to contracts has been made or not, except that: (2) Where actual delivery has been delayed through the fault of either the buyer or seller purporting to be leases of personal property with option to buy the goods are at the risk of the party at fault." by virtue of Art. 1485. The condition that the lessor has deprived the lessee of possession or enjoyment of the thing for On this score, we quote with approval the findings of the the purpose of applying Art. 1485 was fulfilled in this case by appellate court, thus: The defendant [herein private the filing by petitioner of the complaint for replevin to recover respondent] was not remiss in reminding the plaintiff that it possession of movable property. The prayer for a writ of would have to bear the said expenses for failure to lift the replevin is only for the purpose of ensuring specific commodity for an unreasonable length of time.But even assuming that the plaintiff did not consent to be so bound, the performance by private respondents. However, the private provisions of Civil Code come in to make it liable for the respondents could no longer be held liable for the payment of damages sought by the defendant. intereston unpaid monthly rentals since it was entered into in pursuance of a car plan adopted by petitioner forthe benefit of its deserving employees. Further, private respondents default in payment was due to the cessation of operations of petitioner’s sister company, Elizalde Steel Company. That petitioner accepted payments from Lantan more than two years after the latter’s employment have been terminated constitutes a waiver of petitioner’s right to collect interest upon delayed payment. What private respondents paid should be considered the payment in full. Pagtalunan v. Vda.deManzano RULING: G.R. No. 147695, September 13, 2007 NO, the contract has not been automatically rescinded. FACTS: While the Court agrees with petitioner that the cancellation of Patricio Pagtalunan, petitioner’s stepfather, entered into a the Contract to Sell may be done outside the court particularly Contract to Sell with private respondent Rufina Manzano over when the buyer agrees to such cancellation, the cancellation of a house and lot for P17,000 to be paid in the following manner: the contract by the seller must be in accordance with Sec. 3 P1,500 as downpayment upon execution of the Contract and (b) of the Maceda Law, which requires:(1) a notarial act of the balance to be paid in equal monthly installments of P150 rescission and (2) the refund to the buyer of the full on or before the last day of each month until fully paid. payment of the cash surrender value of the payments on the property. Actual cancellation of the contract takes place The contract provides that while respondent could immediately after 30 days from receipt by the buyer of the notice of occupy the house and lot, in case of default in the payment of cancellation or the demand for rescission of the contract by a any of the installments for 90 days after its due date, the notarial act AND upon full payment of the cash surrender contract would be automatically rescinded without need of value to the buyer. judicial declaration; all payments made and all improvements done on the premises by respondent would be considered as Here, the Contract to Sell was not validly cancelled or rentals for the use and occupation of the property or payment rescinded under Sec. 3 (b) of the Maceda Law.First, Patricio, for damages suffered; and that respondent should peacefully the vendor in the Contract to Sell, died on September 17, 1992 vacate the premises and deliver the possession thereof back to without canceling the Contract to Sell. Second, petitioner the vendor. also failed to cancel the Contract to Sell in accordance with law. Petitioner Pagtalunan alleged that Manzano stopped paying after December 1979 without any justification or explanation Meanwhile, petitioner asserts that his demand letter should be and that the latter paid only P12,950.Pagtalunan asserted that considered as the notice of cancellation or demand for when respondent ceased paying her installments, her status of rescission by notarial act and that the cash surrender value of buyer was automatically transformed to that of a lessee. the payments on the property has been applied to rentals for the use of the house and lot after respondent stopped payment Pagtalunan issued a demand letter for Manzano to vacate the after January 1980. premises of the property but Manzano ignored the same. Thus, Pagtalunan filed a Complaint for unlawful detainer against The Court, however, found that the letter merely made formal respondent with the Municipal Trial Court (MTC) of Guiguinto, demand upon respondent to vacate the premises in Bulacan. question. Clearly, the demand letter is not the same as the notice of cancellation or demand for rescission by a The MTCfound for Pagtalunan, holding that failure to pay not a notarial act required by the Maceda Law. few installments caused the resolution or termination of the Contract to Sell. After her last payment of the installment, Moreover, petitioner cannot insist on compliance with the Manzano’s right of possession ipso facto ceased to be a legal requirement by assuming that the cash surrender value right, and became possession by mere tolerance of Patricio payable to the buyer had been applied to rentals of the and his successors-in-interest. Said tolerance ceased upon property after respondent failed to pay the installments due. demand on respondent to vacate the property. Sec. 3 (b) of the Maceda Law does not provide a different requirement for contracts to sell which allow possession of On appeal, the RTC of Malolos, Bulacan reversed the decision the property by the buyer upon execution of the contract like of the MTC and dismissed the case for lack of merit, ruling that the instant case but the refund of the cash surrender value the agreement could not be automatically rescinded since of the payments on the property to the buyer before there was delivery to the buyer. A judicial determination of cancellation of the contract. rescission must be secured by petitioner as a condition precedent to convert the possession de facto of respondent There being no valid cancellation of the Contract to Sell, the from lawful to unlawful. Court held that CA correctly recognized respondent’s right to continue occupying the property subject of the Contract to Sell The Court of Appeals affirmed the RTC’s decision but held that and affirmed the dismissal of the unlawful detainer case by the the parties, as well as the MTC and RTC, failed to advert to RTC.Consequently, it is only right and just, under the and to apply the Maceda Law (RA 6522). It ruled that the Maceda Law, to allow respondent to pay her arrears and Contract to Sell was NOT VALIDLY cancelled or rescinded settle the balance of the purchase price, subject to under Sec. 3 (b) of the Maceda Law, and recognized interests. respondent’s right to continue occupying unmolested the property subject of the contract to sell.
ISSUE:
WON the contract has been automatically rescinded pursuant
to the agreement when Manzano defaulted in the payment of her installments?