SUPREME COURT MANILA

FIRST DIVISION

RENE B. TANCHULING, ET. AL.,Petitioner,

VS.

SOTERO C. CANTELA, Respondent.

G.R. NO. 209284, November 10, 2015

FACTS:

 Spouses Tanchuling and Cantela executed the Deed of Absolute Sale covering two parcels of land
on March 17, 2005
 The subject deed stated that Cantela paid P400,000.00 as consideration for the properties.
 Vicente, the spouse of Renee, delivered the owner's copies of the TCTs to Cantela after the
execution of the subject deed, but none of the parties are in actual physical possession of the
properties.
 Sps. Tanchuling filed a complaint for annulment of deed of sale and delivery of the owner's
duplicate copy of the TCTs with preliminary prohibitory and mandatory injunction before the
RTC, alleging that the subject deed was absolutely simulated since there was no actual
consideration paid by Cantela to them.
 Cantela claimed that the sale of the properties was valid as he bought them for P400,000.00,
and that the undated deed was surreptitiously inserted by Sps. Tanchuling in the copies of the
subject deed presented to him for signing.
 The RTC nullified the subject deed, finding that the parties never intended to be bound by it in
view of the simultaneous execution of the undated deed selling back the properties to Sps.
Tanchuling
 Cantela appealed to the CA, which reversed the RTC ruling and found that there was
consideration for the sale and that the subject deed should prevail over the undated deed.

ISSUE:

Whether or not the Deed of Absolute Sale executed between Sps. Tanchuling and Cantela is null
and void for being absolutely simulated.

RULING:

Supreme Court ruled through Justic Perlas-Bernabe that the subject deed was absolutely
simulated. The parties never intended to be bound by any sale agreement. Instead, the subject deed was
executed merely as a front to show the public that Sps. Tanchuling were the owners of the properties in
order to deter the group of John Mercado from illegally selling the same. Although the subject deed
between Sps. Tanchuling and Cantela stipulated a consideration of P400,000.00, there was actually no
exchange of money between them. The Court cited Cruz v. Bancom Finance Corporation (Cruz), which
ruled that "a contract of purchase and sale is null and void and produces no effect whatsoever where it
appears that the same is without cause or consideration which should have been the motive thereof, or
the purchase price which appears thereon as paid but which in fact has never been paid by the
purchaser to the vendor."