DIGNOS VS COURT OF APPEALS

G.R. No. L-59266, February 29, 1988

Petitioners: Silve Stre Dignos and Isabel
Respondents: Hon. Court of Appeals and Atilano G. Jabil
Ponente: J. Bidin

FACTS:

a) The petitioners, Dignos spouses, owned a parcel of land, referred to as Lot No. 3453 of
the cadastral survey of Opon in Lapu-Lapu City.
b) On June 7, 1965, the aforementioned land was sold by the petitioners, Dignos spouses,
to the respondent, Atilano J. Jabil, for P28,000,000, payable in two installments. (Exh C)
c) Later on, on November 25, 1965, the same land was sold for P35,000,000 by Dignos
spouses to defendants' spouses, Luciano Cabigas and Jovita L. De Cabigas.
d) An absolute deed of sale (Exh J) was executed in favor of the Cabigas spouses and
was duly registered in the Office of the Register of Deeds.
e) When respondent, Atilano J. Jabil, discovered the second sale of the land in question
(to Cabigas spouses), he filed a complaint at the Court of First Instance of Cebu.
f) The Court of First Instance of Cebu rendered its decision declaring the second sale
(Exh J; Cabigas spouses) null and void ab initio, and the first sale (Exh C; Atilano G.
Jabil) not rescinded.
g) Moreover, the court ordered the plaintiff, Atilano G. Jabil, to reimburse the defendants,
Cabigas spouses, a reasonable amount for the costs of the hollow block fence.
h) The court also ordered Dignos spouses to return the sum of P35,000,000 to Cabigas
spouses.
i) The Dignos spouses argued that their contract with Jabil was mere a contract to sell
rather than a deed of sale.
j) Both parties appealed to the Court of Appeals.
k) Court of Appeals affirmed the lower court's rulings except for the order directing Jabil to
reimburse the expenses incurred by the Cabigas couples in constructing a fence on the
land in dispute.
l) A motion for reconsideration of the said decision was filed by petitioners, Dignos
spouses; however, it was subsequently denied by the Court of Appeals for lack of merit.

ISSUES:

1. Whether or not the subject contract is a deed of absolute sale or a contract to sell.
2. Whether or not there was a valid rescission when Dignos spouses sold the land to the
Cabigas spouses.

HELD:

1. Yes. The contract in question (Exh C) is a deed of absolute sale, although denominated
as a Deed of Conditional Sale. There is no stipulation in the contract in question to the
effect that: (1) title to the property sold is reserved in the seller until full payment of the
purchase price, and; (2) seller has the right to unilaterally rescind the contract when the
buyer fails to pay within a fixed period. Furthermore, all the elements of a valid contract
of sale under Article 1458, CC is present - consent, object, and cause. Lastly, Dignos
spouses were no longer the owners of the land in dispute; therefore, they did not have
the right to sell the property since they delivered the possession in favor of Jabil as early
as March 27, 1965. 
2. Yes. There is no valid rescission of the contract (Exh C). The petitioners, Dignos
spouses, never notified private respondents Jabil by a notarial act nor filed a suit in
court to rescind the contract of sale. The only thing that they showed was a letter from
Cipriano Amistad, who claims to be a representative of Jabil, notifying the Dignos
spouses that Jabil has insufficient money to pay for the property and encouraged the
latter to sell the land in question with another party. However, there is no evidence that
Jabil lawfully authorized a certain Cipriano Amistad to inform petitioners that he had
previously waived his rights. Additionally, under Article 1358, CC, it is required that acts
and contracts which have for their object the extinguishment of real rights over
immovable property must appear in a public document. Lastly, where time is not of the
essence of the agreement, a slight delay on the part of one party in the performance of
his obligation is not sufficient ground for the rescission of the contract. 

Hence, the petition filed is hereby dismissed for lack of merit and the assailed decision of the
Court of Appeals is affirmed in toto.
LIMKETKAI SONS MILLING VS COURT OF APPEALS
G.R. No. 118509, December 1, 1995
Petitioners: Limketkai Sons Milling, Inc.
Respondents: Court of Appeals, Bank of The Philippine Islands and National Book Store
Ponente: J. Melo

FACTS:
a) Philippine Remnants Co., Inc. constituted Bank of The Philippine Islands (BPI) as trustee
to manage, administer, and sell its real estate property, particularly the disputed lot, a
33,056-square meter lot at Barrio Bagong Ilog, Pasig, Metro Manila.
b) A licensed real estate broker, Pedro Revilla, Jr., was given formal authority by BPI to sell
the lot for P1,000 per square meter. 
c) Broker Revilla contacted Alfonso Lim of the Limketkai Sons Milling Inc. (petitioner), who
agreed to buy the land and subsequently view the property.
d) Alfonso Lim and Albino Limketkai of the petitioner company went to BPI to confirm the
sale with Vice-President Merlin Albano and Asst. Vice-President Aromin of BPI.
e) Both parties agreed at a price of P1,000 per square meter in cash for the lot. 
f) Despite the agreement, Alfonso Lim requested whether it was possible to pay on terms,
with the condition that if the term payment is disapproved, then the price must be paid in
cash.
g) Two or three days after, the petitioner learned that its offer to pay on terms had been
frozen; he went to BPI to tendered the full payment of P33,056,000 to Albano.
h) Albano refused the payment, claiming that the authority to sell that parcel of land in
Pasig had been withdrawn from his unit.
i) The petitioner filed an action for specific performance with damages against BPI.
j) BPI informed the trial court that it had sold the property under litigation to National Book
Store (NBS).
k) The Regional Trial Court of the National Capital Judicial Region ruled there was a
perfected contract of sale between the petitioner and BPI; then, ordered the cancellation
of sale by BPI to NBS.
l) The Court of Appeals held that the decision of the trial court was reversed and the
complaint dismissed.

ISSUES:

1. Whether or not there was a meeting of the minds between petitioner Limketkai and
respondent BPI as to the subject matter of the contract and the cause of the obligation.
2. Whether or not the sale of the disputed land to the NBS during the pendency of trial
effected in good faith.

HELD:
1. Yes. There was already a meeting of the minds as to the object and the cause between
Limketkai Sons Milling Inc. and BPI. The perfection of the contract took place when the
petitioner's top officials, Alfonso Lim and Albino Limketkai, finalized the details with BPI
Vice-Presidents Merlin Albano and Rolando V. Aromin who had full authority to bind the
bank at the BPI offices. Both parties agreed to the sale of the lot in question at a price of
P1000 per square meter. Although Lim asked for payment in terms instead of cash, it is
apparent that if the former is denied, the price will be payable in cash. Furthermore,
there existed a prior agreement between the petitioner and broker Revilla having the full
authority to act and sell the lot on behalf of the BPI. 
2. No. National Book Store (NBS) is not an innocent purchaser for value; thus, it acted in
bad faith. Respondent NBS ignored the notice of lis pendens annotated on the title when
it bought the lot. As a result, BPI dishonored the contract with Limketkai. Also, the
petitioner cites several badges of fraud indicating that BPI and NBS conspired to prevent
the former from paying the agreed price and getting possession of the
property. Generally, the seller must guarantee the title of the land to the buyer, and the
latter has the right to proceed against the former if the title turns out to be defective.
However, the deed of sale between BPI and NBS states the opposite. In the event that
the title turns out to be vested in another person, any losses incurred by NBS are to be
borne by them alone. BPI is expressly freed under the contract from any recourse of
NBS against it should BPI's title be found defective.

Hence, the questioned judgment of the Court of Appeals is hereby reversed and set aside. The
judgment of Branch 151 of the Regional Trial Court of The National Capital Judicial Region
stationed in Pasig, Metro Manila is reinstated except for the award of Ten Million Pesos
(P10,000,000) damages which is hereby deleted.
TRADERS ROYAL BANK V. CUIZON LUMBER CO.
G.R. No. 174286, June 5, 2009
Petitioners: Traders Royal Bank
Respondents: Cuison Lumber Co., Inc., and Josefa Jerodias Vda. De Cuison
Ponente: J. Brion

FACTS:
a) On July 14, 1978, and December 9, 1979, respectively, Cuison Lumber Co., Inc., (CLCI),
through its then-president, Roman Cuison Sr., obtained two loans from Traders Royal
Bank secured by a real estate mortgage over a parcel of land.
b) CLCI failed to repay the loan, causing the bank to foreclose the mortgage on the subject
property extrajudicially.
c) The bank was declared the highest bidder at the public auction.
d) In a series of written communications between CLCI and the bank, the former
manifested its intention to restructure its loan obligations and repurchase the subject
property.
e) On July 31, 1986, Mrs. Cuison, the widow and administratrix of the estate of Roman
Cuison Sr., wrote the Officer-in-Charge of the bank, Remedios Calaguas, a letter
indicating her offered terms of repurchase. 
f) CLCI paid the bank ₱50,000 and ₱85,000, regarded as earnest money for the
repurchase of the subject property. 
g) The bank sent a letter to Atty. Roman Cuison, Jr., the president and general manager of
CLCI, informing the latter of the resolution passed by the bank's board of directors dated
October 10, 1986, laying down the conditions for the repurchase of the subject property. 
h) CLCI failed to comply with the terms, notwithstanding the extensions of time given by the
bank. 
i) Nevertheless, CLCI tendered a check for ₱135,091.57 to cover fifty percent (50%) of the
twenty percent (20%) bid price; however, rejected due to insufficiency of funds. 
j) CLCI tendered an additional P50,000.
k) The bank sent Atty. Cuison a letter informing him that the ₱185,000 (f and j) payment by
CLCI was not a deposit but formed part of the earnest money under the TRB
Repurchase Agreement.
l) Atty. Cuison wrote to the bank, requesting that CLCI's outstanding obligation of
1,221,075.61 (as of July 31, 1987) be reduced to ₱1 million and that the bank condone
the sum of ₱221,075.61.
m) On August 28, 1987, CLCI paid the bank ₱100,000.00 and ₱200,000.00 to show its
commitment to the request. 
n) A year later, CLCI inquired about the status of its request, and the bank responded that
the request was still under consideration by the Manila office of the bank.
o) On September 30, 1988, the bank informed CLCI that it would resell the subject property
at an offered price of ₱3 million and gave CLCI 15 days to make a formal offer;
otherwise, the bank would sell the subject property to third parties. 
p) On October 26, 1988, CLCI offered to repurchase the subject property for ₱1.5 million,
given that it had already tendered the amount of ₱400,000 (f, j, l) as earnest money.
q) CLCI subsequently claimed that the bank breached the terms of repurchase - it had
wrongly considered its payments (in the amounts of ₱140,485.18, ₱200,000.00, and
₱100,000.00) as earnest money, instead of applying them to the purchase price. 
r) Through its counsel, CLCI demanded that the bank rectify the repurchase agreement to
reflect the true consideration agreed upon for which the earnest money had been given. 
s) The bank did not act on the demand. 
t) On February 10, 1989, CLCI and Mrs. Cuison filed with the RTC a complaint about a
breach of contract, specific performance, damages, and attorney’s fees against the
bank. 
u) On April 20, 1989, the bank filed its Answer alleging that the TRB repurchase agreement
was already canceled given CLCI’s failure to comply with its provisions.
v)  RTC ruled in favor of the Cuisons. CA affirmed, hence this petition.

ISSUES:

1. Whether or not a perfected contract of repurchase existed and can be enforced between
the parties.

HELD:

1. Yes. There is a perfected contract to repurchase the subject property between the bank
and CLCI. According to law, a contract is perfected by mere consent. Only a certain
offer (i.e., definite), when met by an absolute acceptance (i.e., identical in all respects
 with that of the offer), will give rise to a valid contract. In this case, some evidence on
record may argue for the absence of a meeting of the minds. However, those records
were the results of CLCI's failure to comply with its obligation to pay the amounts due
on the stipulated time after the perfection of the contract. Thus, despite some ambiguity,
the facts of the case resulted in the conclusion that both parties agreed to the
repurchase of the subject land.

While there existed a valid contract between the parties, the bank effectively canceled it
on September 30, 1988. The bank communicated to CLCI that it will resell the subject
property to third parties for $3 million, allowing CLCI 15 days to submit a formal offer.
Following that, CLCI offered to repurchase the property for ₱1.5 million, but the bank
rejected it.

Hence, the petition was granted. The decision of the Court of Appeals is hereby reversed and
set aside.
MANILA METAL CONTAINER CORP. V PNB
G.R. No. 166862, December 20, 2006
Petitioners: Manila Metal Container Corporation
Intervenor: Reynaldo C. Tolentino
Respondents: Philippine National Bank
Intervenor: DMCI-Project Developers, Inc.
Ponente: J. Callejo, Sr.

FACTS:
a) Manila Metal Container Corporation, the petitioner, owned an 8,015 square meter parcel
of land located in Mandaluyong (now a City), Metro Manila. 
b) The petitioner executed a real estate mortgage over the lot to secure a P900,000.00
loan from respondent Philippine National Bank (PNB). 
c) Respondent PNB later granted the petitioner a new credit accommodation
of P1,000,000.00. 
d) Later, the petitioner secured another loan of P653,000.
e) On August 5, 1982, respondent PNB filed a petition for extrajudicial foreclosure of the
real estate mortgage.
f) After due notice and publication, the property was sold at a public auction in favor of
respondent PNB for P1,000,000.00. 
g) The period to repurchase the property expires on February 17, 1984.
h) Petitioner sent a letter to respondent PNB requesting an extension of time to repurchase
the property; subsequently, it reiterated its request to repurchase the property on
installment.
i) A PNB Pasay City Branch personnel informed the petitioner that partial redemption is
not allowed under their policy.
j) The petitioner failed to redeem the property while the Register of Deeds canceled TCT
No. 32098 and issued a new title in favor of respondent PNB. 
k) The Special Assets Management Department (SAMD) prepared a statement regarding
the petitioner's obligation.
l) SAMD recommended to the management of respondent PNB that the petitioner be
allowed to repurchase the property for P1,574,560, but the latter rejected it.
m) PNB management suggested that the petitioner purchase the property at its minimum
fair value of P2,660,000 until December 15, 1984; otherwise, PNB would return the
deposit amounting to P725,000 and the property sold to other buyers.
n) However, the petitioner rejected respondent PNB's proposal, declaring that it had
deposited P725,000 because it already agreed to the SAMD's offer to purchase the
property for P1,574,560.47. 
o) On August 28, 1989, the petitioner filed a complaint against respondent PNB.
p) The trial court rendered judgment dismissing the amended complaint and respondent
PNB's counterclaim.
q) The Court of Appeals rendered judgment, affirming the decision of the RTC.

ISSUES:
1. Whether or not there is a perfected contract of sale between the parties.

HELD:

2. No. There was no perfected contract of sale between the parties. A contract is a
meeting of minds between two persons whereby one binds himself with respect to the
other to give something or render some service. Under Article 1318 of the New Civil
Code, there is no contract unless the following requisites concur: (1) Consent of the
contracting parties; (2) Object certain which is the subject matter of the contract; (3)
Cause of the obligation. A contract of sale, in particular, is consensual in nature. When
there is merely an offer by one party without acceptance of the other, there is no
contract. When the contract of sale is not perfected, it cannot be an independent source
of obligation that will serve as a binding juridical relation between the parties. 

The petitioner never agreed to the selling price proposed by respondent PNB
(P1,931,389.53) since the former had kept on insisting that the price should be lowered
to P1,574,560.47. Additionally, under Article 1482 of the New Civil Code,
the P725,000.00 that the petitioner remitted to the respondent is not earnest money and
was merely a deposit to be applied as part of the purchase price if respondent would
approve the recommendation of SAMD (P1,574,560.47). Unless and until the
respondent accepted the offer, no perfected contract of sale would arise. 
Hence, the petition was denied. The assailed decision was affirmed. 

CAMACHO V. CA
G.R. No. 127520, February 9, 2007
Petitioners: Aurora Fe B. Camacho
Respondents: Court of Appeals and Angelino Banzon
Ponente: J. Callejo, Sr.

FACTS:
a) Aurora Fe B. Camacho, petitioner, owned Lot 261, a 7.5-hectare parcel of land situated
in Balanga, Bataan.
b) On July 14, 1968, Camacho and respondent Atty Angelino Banzon entered into a
contract for legal services denominated as a Contract of Attorney’s Fee. The
consideration for the undertaking was the 5000 sq meters portion of the said land
(Annex A).  
c) According to the agreement, Atty. Banzon sent a letter-proposal to the municipal council
offering three sites for the proposed public market, including Lot 261. 
d) On the same date, Camacho executed a Special Power of Attorney to give Atty Banzon
the authority to perform and sign for her behalf a Deed of Donation transferring a
17,000-sq-m portion of Lot 261 to the municipal government of Balanga, Bataan. 
e) The Deed of Donation was executed and accepted by the local government unit in
Municipal Resolution No. 127.
f) Camacho and the Municipality of Balanga, through then Acting Mayor Victor Y. Baluyot,
filed a complaint about the forcible entry (Civil Case No. 424) against Silvestre Tuazon,
an agricultural tenant in Lot 261 who refused to vacate the premises. Eventually, the
case was decided in favor of the plaintiffs, and Tuazon was ordered to leave the lot. 
g) On December 6, 1973, Camacho filed a Manifestation (Civil Case No. 3512) declaring
that she had terminated the services of Atty. Banzon and had retained the services of
new counsel, Atty. Victor De La Serna.
h) On December 17, 1973, Atty. Banzon filed a Complaint-in-Intervention in Civil Case No.
3512, alleging Camacho had engaged his services as counsel in CAR Case No. 59 B’65
(where a favorable decision was rendered) and in Civil Case No. 3512.
i) He declared that his requests on Camacho to deliver the portions of the subject lot
remained unheeded: (1) 5000 square meters as a consideration of the Contract of
Attorney’s Fee (Annex A); (2) 80 square meters that he purchased from Camacho
(Annex C); (3) 800 square meters that he purchased from third parties; (4) 1000 square
meters as an attorney's fee in handling seven cases.
j) In answer to the complaint-in-intervention, Camacho: (1) denied that she solicited the
services of Atty. Banzon to facilitate the transfer of the site of the proposed public
market; (2) admitted that she signed the Contract of Attorney’s Fee but only upon the
request of Atty. Banzon, saying it is for formality's sake, but the former never intended to
be bound by it; (3) denied that she agreed to give to Atty. Banzon 1,000 sq m for
handling the seven cases, stating that she was not even a party in some cases cited by
Atty. Banzon; (4) denied that he had made demands to deliver the mentioned portions of
the property. 
k) After trial on the merits, the RTC rendered a Decision on September 1, 1992, in favor of
Atty. Banzon. 
l) On October 29, 1996, the Court of Appeals rendered a decision affirming with
modification the RTC ruling. 

ISSUES:

1. Whether or not did the Court of Appeals correctly apply the provision of Art. 1246 of the
Civil Code to the instant case in ruling that contract exh. "c" is valid as to object?

HELD:

1. Yes, the Court of Appeals correctly applied the provision of Art. 1246 of the Civil Code
to the instant case in ruling that contract Exh. C is valid as to object. Under Articles
1349 and 1460 of the Civil Code, the requisite that a thing be determinate is satisfied if
at the time the contract is entered into, the thing is capable of being made determinate
without the necessity of a new or further agreement between the parties. In this case,
the object of the contract is the 5,000-sq-m portion of Lot 261, Balanga Cadastre. While
it is true that the identity of the object has not been specified due to the parties' inability
to describe the subject property with particularity, it is capable of being made
determinate without the need of a new contract between the parties. Camacho bound
 herself to deliver a portion of Lot 261 to Atty. Banzon, the description of the property
subject of the contract is sufficient to validate the same.

Hence, the appealed decision is affirmed with the modification that the award of a 1,000-square-
meter portion of Lot 261 to respondent Atty. Angelito Banzon as attorney’s fees is deleted.