Obligations and Contracts

February 20, 19843 No. L-30786 CLARIN (PETITIONER) VS. RULONA (RESPONDENTS) Facts: Petitioner Clarin is heir to 10 hectares of land constituting his share in the common inheritance from his late father. He sold his share to the Respondent Rulona for P2,500. Rulona, as initial downpayment, paid P1,000 and the first installment of P100. Petitioner also executed two documents relative to the sale. The first document (Exhibit A) was an authorization to survey the land on behalf of the petitioner, and the second (Exhibit B) a receipt of payment for a downpayment of P800. Later on, Clarin returned the payments made by Rulona and refused to further sell the property. Rulona then filed a complaint for specific performance. Clarin, responding to the complaint averred that the contract was subject to a condition that should his coheirs need to consent to the sale and should they not consent, the contract would not be discontinued. Furthermore, the P1,000 was only earnest money, subject to the condition stated and would be returned should the condition not materialize (consent of the co-heirs). Respondent relied heavily on the two executed documents to attest his claim of a perfected contract of sale. Clarin rebuts saying that: 1) the documents could not effectively convey title land because they were not public documents, 2) even if there was a perfected contract of sale it was subject to the condition precedent, and 3) he could not validly dispose of a definite portion of a community property, therefore there is legal impossibility for him and the respondent to agree on a definite object. Both Trial Court and CA hold for respondent. Issue: WON there was a perfected contract of sale? Held: YES. The two documents executed, in themselves, are not contracts of sale but they are evidence that a contract of sale was perfected between petitioner and respondent and that such contract had already been partially fulfilled and executed. Essential requisites are present: 1) Petitioner agreed to sell and respondent agreed to buy and the latter acceptance of the downpayment clearly showed his consent to the contract, 2) object is 10 hectares of land part of the common inheritance, 3) there was a definite price of P2,500. With the contract being partially executed, the same is no longer covered by the requirements of the Statute of Frauds in order to be enforceable. Therefore, with the contract being valid and enforceable, the petitioner cannot avoid his obligation by interposing that Exhibit A is not a public document. On the contrary, under Article 1357, the petitioner can even be compelled by the respondent to execute a public document to embody their valid and enforceable contract. Also, the petitioners contention that he was only forced to receive downpayment because of the insistence of the latter merits little consideration. It is highly improbable that the respondent would give different sums of money on separate dates for no apparent reason, without a binding assurance that the lot will be sold to him. Petitioners claim of a condition precedent is also without merit. In his letter to respondent in unilaterally rescinding the contract, his stated reason was that his daughter could not be convinced to agree to the sale. Such reason could not operate against the validity of the contract (his alleged reason previously was that it was his co-heirs who do not agree). NOTE: Statute of Frauds need documents in writing for certain contracts to be enforceable. However, this does not deprive the parties of the right to contract but merely regulates the formalities of the contract to make it enforceable. Hence, a party who has already performed his obligation (maybe total or partial) under an oral contract, can enforce the contract if he can prove that there was a valid agreement (that the contract was already perfected).

Bernz Velo Tumaru