Velarde vs CA

Facts: David Raymundo (private respondent) is the absolute and registered owner of a parcel of land,
located at 1918 Kamias St., Dasmarias Village Makati, together with the house and other
improvements, which was under lease. It was negotiated by Davids father with plaintiffs Avelina and
Mariano Velarde (petitioners). ADeed of Sale with Assumption of Mortgage was executed in favor of
the plaintiffs. Part of the consideration of the sale was the vendees assumption to pay the mortgage
obligations of the property sold in the amount of P 1,800,000.00 in favor of the Bank of the Philippine
Islands. And while their application for the assumption of the mortgage obligations is not yet approved
by the mortgagee bank, they have agreed to pay the mortgage obligations on the property with the
bank in the name of Mr. David Raymundo. It was further stated that in the event Velardes violate any
of the terms and conditions of the said Deed of Real Estate Mortgage, they agree that the down
payment P800,000.00, plus all the payments made with the BPI on the mortgage loan, shall be forfeited
in Favor of Mr. Raymundo, as and by way of liquidated damages, w/out necessity of notice or any
judicial declaration to that effect, and Mr. Raymundo shall resume total and complete ownership and
possession of the property, and the same shall be deemed automatically cancelled, signed by the
Velardes.

Pursuant to said agreements, plaintiffs paid BPI the monthly interest loan for three months but stopped
in paying the mortgage when informed that their application for the assumption of mortgage was not
approved. The defendants through a counsel, wrote plaintiffs informing the latter that their non-
payment to the mortgagee bank constituted non-performance of their obligation and the cancellation
and rescission of the intended sale. And after two days, the plaintiffs responded and advised the vendor
that he is willing to pay provided that Mr. Raymundo: (1) delivers actual possession of the property to
them not later than January 15, 1987 for their occupancy (2) causes the release of title and mortgage
from the BPI and make the title available and free from any liens and encumbrances (3) executes an
absolute deed of sale in their favor free from any liens and encumbrances not later than Jan. 21, 1987.

The RTC of Makati dismissed the complaint of the petitioners against Mr. Raymundo for specific
performance, nullity of cancellation, writ of possession and damages. However, their Motion for
Reconsideration was granted and the Court instructed petitioners to pay the balance of P 1.8 million to
private respondent who, in turn were ordered to execute a deed of absolute sale and to surrender
possession of the disputed property to petitioners.

Upon the appeal of the private respondent to the CA, the court upheld the earlier decision of the RTC
regarding the validity of the rescission made by private respondents.

Issue: Whether the rescission of contract made by the private respondent is valid.

Held: There is a breach of contract because the petitioners did not merely stopped paying the
mortgage obligations but they also failed to pay the balance purchase price. Their conditional offer to
Mr. Raymundo cannot take the place of actual payment as would discharge the obligation of the buyer
under contract of sale.

Mr. Raymundos source of right to rescind the contract is Art. 1191 of the Civil Code predicated on a
breach of faith by the other party who violates the reciprocity between them. Moreover, the new
obligations as preconditions to the performance of the petitioners own obligation were repudiation of
an existing obligation, which was legally due and demandable under the contract of sale.

The breach committed by the petitioners was the non-performance of a reciprocal obligation. The
mutual restitution is required to bring back the parties to their original situation prior to the inception
of the contract. The initial payment and the mortgage payments advanced by petitioners should be
returned by private respondents, lest the latter unjustly enriched at the expense of the other. Rescission
creates the obligation to return the obligation of contract. To rescind, is to declare a contract void at
its inception and to put an end to it as though it never was.

The decision of the CA is affirmed with modification that private respondents are ordered to return to
petitioners, the amount they have received in advanced payment.

CORTES vs. Court of Appeals
494 SCRA 570 (Art. 1169)
Facts:
For the purchase price of 3.7M, Villa Esperanza Development Corporation (vendee) and Antonio
Cortes (vendor) entered into a contract of sale over the lots located at Baclaran, Paraaque, Metro
Manila. The Corporation advanced to Cortes the total sum of P1,213,000.00. In September 1983, the
parties executed a deed of absolute sale on the following terms:
The Corporation shall advance 2.2 M as down payment, and Cortes shall likewise deliver the TCT for
the 3 lots.
The balance of 1.5M shall be payable within a year from the date of the execution.
The Corporation filed the instant case for specific performance seeking to compel Cortes to deliver the
TCTs and the original copy of the Deed of Absolute Sale. According to the Corporation, despite its
readiness and ability to pay the purchase price, Cortes refused delivery of the sought documents. It
prayed for damages, attorneys fees and litigation expenses. Cortes claimed that the owners duplicate
copy of the three TCTs were surrendered to the Corporation and it is the latter which refused to pay in
full the agreed down payment.
RTC rendered a decision rescinding the sale and directed Cortes to return to the Corporation the
amount of P1,213,000.00, plus interest. CA reversed the decision and directed Cortes to execute a
Deed of Absolute Sale conveying the properties and to deliver the same to the Corporation together
with the TCTs, simultaneous with the Corporations payment of the balance of the purchase price of
P2,487,000.00.
Issue:
WON Cortes delivered the TCTs and the original Deed to the Corporation? NO.
WON there is delay in the performance of the parties obligation that would justify the rescission of the
contract of sale? THERE IS DELAY IN BOTH PARTIES (compensation morae)
Held:
Cortes avers that he delivered the TCTs through the brokers son. He further avers that the brokers
son delivered it to the broker, who in turn delivered them to the Corporation.
Marcosa Sanchezs unrebutted testimony is that, she did not receive the TCTs. She also denied
knowledge of delivery thereof to her son, Manny.
What further strengthened the findings of the Court of Appeals that Cortes did not surrender the
subject documents was the offer of Cortes counsel at the pre-trial to deliver the TCTs and the Deed of
Absolute Sale if the Corporation will pay the balance of the down payment. Indeed, if the said
documents were already in the hands of the Corporation, there was no need for Cortes counsel to
make such offer.
Considering that their obligation was reciprocal, performance thereof must be simultaneous. The
mutual inaction of Cortes and the Corporation therefore gave rise to a compensation morae or default
on the part of both parties because neither has completed their part in their reciprocal obligation.
Cortes is yet to deliver the original copy of the notarized Deed and the TCTs, while the Corporation is
yet to pay in full the agreed down payment of P2,200,000.00. This mutual delay of the parties cancels
out the effects of default, such that it is as if no one is guilty of delay.
Under Article 1169 of the Civil Code, from the moment one of the parties fulfills his obligation, delay
by the other begins. Since Cortes did not perform his part, the provision of the contract requiring the
Corporation to pay in full the down payment never acquired obligatory force.

CHENG V. GENATO (December 29, 1998)
FACTS:
Respondent Genato entered a contract to sell to spouses Da Jose pertaining to his property in Bulacan.
The contract made in public document states that the spouses shall pay the down payment and 30 days
after verifying the authenticity of the documents, they shall pay the remaining purchase price.

Da Jose spouses was not able to finish verifying the documents and as such asked for a 30 day
extension. Pending the extension and without notice to the spouses, Genato made a document for the
annulment of the contract.

Petitioner Cheng expressed interest over the property and paid 50K check with the assurance that the
contract between Genato and the spouses Da Jose will be annulled. Da Jose spouses protested with the
annulment and persuaded Genato to continue the contract. Genato returned the check to Cheng and
hence, this petition.

Issue: w/n
HELD:
The contract between Genato and spouses Da Jose was a contract to sell which is subject to a
suspensive condition. Thus, there will be no contract to speak of, if the obligor failed to perform the
suspensive condition which enforces a juridical relation. Obviously, the foregoing jurisprudence
cannot be made to apply to the situation in the instant case because no default can be ascribed to the
Da Jose spouses since the 30-day extension period has not yet expired.

Even assuming that the spouses defaulted, the contract also cannot be validly rescinded because no
notice was given to them. Thus, Cheng's contention that the Contract to Sell between Genato and the
Da Jose spouses was rescinded or resolved due to Genato's unilateral rescission finds no support in
this case.

The contract between Genato and Cheng is a contract to sell not a contract of sale. But even assuming
that it should be treated as a conditional contract of sale, it did not acquire any obligatory force since
it was subject to a suspensive condition that the earlier contract to sell between Genato and the Da
Jose spouses should first be cancelled or rescinded.

Art.1544 should apply because for not only was the contract between herein respondents first in time;
it was also registered long before petitioner's intrusion as a second buyer (PRIMUS TEMPORE,
PORTIOR JURE). (Spouses made annotation on the title of Genato). Since Cheng was fully aware, or
could have been if he had chosen to inquire, of the rights of the Da Jose spouses under the Contract to
Sell duly annotated on the transfer certificates of titles of Genato, it now becomes unnecessary to
further elaborate in detail the fact that he is indeed in bad faith in entering into such agreement.

OLIVERIO LAPERAL& FILIPINAS GOLF & COUNTRY CLUB INC. vs. SOLID HOMES, INC.
G.R. No. 130913. June 21, 2005

Facts: Filipinas Golf Sales and Development Corporation, predecessor-in-interest of Filipinas Golf
and Country Club, Inc., represented by its then President, Oliverio Laperal, entered into a
Development and Management Agreement with respondent Solid Homes, Inc., a registered subdivision
developer, involving several parcels of land owned by Laperal and FGSDC. Under the terms and
conditions of the aforementioned Agreement and the Supplement, respondent undertook to convert at
its own expense the land subject of the agreement into a first-class residential subdivision, in
consideration of which respondent will get 45% of the lot titles of the saleable area in the entire
project. The aforementioned Agreement was cancelled by the parties, and, in lieu thereof, two
contracts identically denominated Revised Development and Management Agreement were entered
into by respondent with the two successors-in-interest of FGSDC. Unlike the original agreement, both
Revised Agreements omitted the obligation of petitioners Laperal and FGCCI to make available to
respondent Solid Homes, Inc. the owners duplicate copies of the titles covering the subject parcels of
land. It appears, however, that even as the Revised Agreements already provided for the non-surrender
of the owners duplicate copies of the titles, respondent persisted in its request for the delivery thereof
.Then, petitioners served on respondent notices of rescission of the Revised Agreements with a demand
to vacate the subject properties and yield possession thereof to them.

Issue: Whether the termination of the Revised Agreement and Addendum, because of the contractual
breach committed by respondent solid homes, carried with it the effect provided under Article 1385 of
the New Civil Code.

Held: Mutual restitution is required in cases involving rescission under Article 1191. Since Article
1385 of the Civil Code expressly and clearly states that rescission creates the obligation to return the
things which were the object of the contract, together with their fruits, and the price with its interest,
the Court finds no justification to sustain petitioners position that said Article 1385 does not apply to
rescission under Article 1191.As a consequence of the resolution by petitioners, rights to the lot should
be restored to private respondent or the same should be replaced by another acceptable lot. Applying
the clear language of the law and the consistent jurisprudence on the matter, therefore, the Court rules
that rescission under Article 1191 in the present case, carries with it the corresponding obligation of
restitution.


TAYAG vs. CA and LEYVA
G.R. No. 96053 March 3, 1993
Facts:
Siblings Juan Galicia Sr. and Celerina Labuguin entered into a contract to sell a parcel of land in
Nueva Ecija to a certain Albrigido Leyva:
o 3K upon agreement
o 10K ten days after the agreement
o 10K representing vendors indebtedness to Phil Veterans Bank
o 27K payable within one year from execution of contract.
Leyva only paid parts of the obligation.
But even after the grace period for payment made in the contract and while litigation of such case, the
petitioners still allowed Leyva to make payments.
With regards to the obligation payable to the Phil Veterans bank by the vendee, as they deemed that it
was not paid in full, such obligation they completed by adding extra amount to fulfill such obligation.
This was fatal in their case as this is Leyvas argument that they constructively fulfilled the obligation
which is rightfully due to him. (Trivia: It was Celerina, Juans sister, that paid the bank to complete
such obligation).
Petitioners claim that they are only OBLIGEES with regards to the contract, so the principle of
constructive fulfillment cannot be invoked against them.
Petitioners, being both creditor and debtor to private respondent, in accepting piecemeal payment even
after the grace period, are barred to take action through estoppel.
Issue:
1. WON there was constructive fulfillment in the part of the petitioners that shall make rise the
obligation to deliver to Leyva the deed of sale? YES
2. WON they are still entitled to rescind the contract? NO, barred by estoppel.
Held:
1. In a contract of purchase, both parties are mutually obligors and also obligees, and any of the
contracting parties may, upon non-fulfillment by the other privy of his part of the prestation, rescind
the contract or seek fulfillment (Article 1191, Civil Code).
In short, it is puerile for petitioners to say that they are the only obligees under the contract since they
are also bound as obligors to respect the stipulation in permitting private respondent to assume the
loan with the Philippine Veterans Bank which petitioners impeded when they paid the balance of said
loan. As vendors, they are supposed to execute the final deed of sale upon full payment of the balance
as determined hereafter.
2. Petitioners accepted Leyvas delayed payments not only beyond the grace periods but also during
the pendency of the case for specific performance. Indeed, the right to rescind is not absolute and will
not be granted where there has been substantial compliance by partial payments. By and large,
petitioners actuation is susceptible of but one construction that they are now estopped from
reneging from their commitment on account of acceptance of benefits arising from overdue accounts of
private respondent.


PRYCE CORPORATION (formerly PRYCE PROPERTIESCORPORATION) vs. PHILIPPINE
AMUSEMENT AND GAMINGCORPORATION
G.R. No. 157480May 6, 2005
FACTS: Petitioner PPC and respondent PAGCOR executed a Contract of Lease involving the
ballroom of the Pryce Plaza Hotel for a period of three (3) years starting December 1, 1992 and until
November30, 1995 for the purpose of opening a casino in Cagayan de Oro City. Later, they executed
an addendum to the contract which included a lease of an additional 1000 square meters of the hotel
grounds. PAGCOR started their casino operations on December18, 1992. Starting December 1992, the
Sangguniang Panlungsod of Cagayan de Oro City passed Resolutions regarding the matter of policy to
prohibit and/or not to allow the establishment of a gambling casino in Cagayan de Oro City and
prohibiting the issuance of business permits and canceling existing business permits to any
establishment for using, or allowing to be used, its premises or any portion thereof for the operation of
a casino. The Court of Appeals promulgated its decision declaring the ordinances unconstitutional and
void and the respondents and all other persons acting under their authority and in their behalf are
permanently enjoined from enforcing the ordinances. The Supreme Court affirmed the decision of the
Court of Appeals. PAGCOR resumed casino operations. However, casino operations were indefinitely
suspended due to the incessant public demonstrations held. Per verbal advice from the Office of the
President of the Philippines, PAGCOR decided to stop its casino operations in Cagayan de Oro City.
PAGCOR stopped its casino operations in the hotel prior to September, 1993. In two Statements of
Account dated September 1, 1993, PAGCOR was informed of its outstanding account for the quarter
September 1to November 30, 1993. PPC sent PAGCOR another Letter dated September 3, 1993 as a
follow-up. PPC sent PAGCOR another Letter dated September 15, 1993 stating its Board of Directors'
decision to collect the full rentals in case of pre-termination of the lease. PAGCOR answered through a
letter dated September20, 1993 stating that it was not amenable to the payment of the full rentals citing
as reasons unforeseen legal and other circumstances which prevented it from complying with its
obligations. PAGCOR further stated that it had no other alternative but to pre-terminate the lease
agreement due to the relentless and vehement opposition to their casino operations. Ina letter dated
October 12, 1993, PAGCOR asked PPC to refund the total of P1,437,582.25 representing the
reimbursable rental deposits and expenses for the permanent improvement of the Hotel's parking lot. In
a letter dated November 5, 1993, PAGCOR formally demanded from PPC the payment of its claim for
reimbursement. On November 15, 1993, PPC filed a case for sum of money in the RTC of Manila On
November 19, 1993, PAGCOR also filed a case for sum of money in the RTC of Manila. In a letter
dated November 25, 1993, PPC informed PAGCOR that it was terminating the contract of lease due to
PAGCOR's continuing breach of the contract and further stated that it was exercising its rights under
the contract of lease pursuant to Article 20 (a) and (c) thereof. The RTC ruled 50 percent reduction for
the payment of the amount PPC was claiming and 2 percent penalty was to be imposed from the date of
the promulgation of the Decision, not from the date stipulated in the Contract. It did not rule that the
Contract of Lease had already been terminated as early as September 21, 1993, or at the latest, on
October 14, 1993, when PPC received PAGCOR's letter dated October 12, 1993. Hence, did not find
also PPC liable for the reimbursement of PAGCOR'S cash deposits and of the value of improvements.
It did not also consider that PPC was entitled to avail itself of the provisions of Article XX only when
PPC was the party terminating the Contract. Finally, it did not find that there were valid, justifiable
and good reasons for terminating the Contract.CA ruled that the PAGCOR'S pre-termination of the
Contract of Lease was unjustified. The appellate court explained that public demonstrations and rallies
could not be considered as fortuitous events that would exempt the gaming corporation from complying
with the latter's contractual obligations. Therefore, the Contract continued to be effective until PPC
elected to terminate it on November 25, 1993. As PAGCOR had admitted its failure to pay the rentals
for September to November 1993, PPC correctly exercised the option to terminate the lease agreement.
Previously, the Contract remained effective, and PPC could collect the accrued rentals. However, from
the time it terminated the Contract on November 25, 1993, PPC could no longer demand payment of
the remaining rentals as part of actual damages, the CA added. Upon the other hand, future rentals
cannot be claimed as compensation for the use or enjoyment of another's property after the termination
of a contract. We stress hat by abrogating the Contract in the present case, PPC released PAGCOR
from the latter's future obligations, which included the payment of rentals. To grant that right to the
former is to unjustly enrich it at the latter's expense.
ISSUE/S:(1) Whether or not there was only a right to termination, and not rescission thereby entitling
PPC to future rentals or lease payments for the unexpired period of its Contract of Lease between with
PAGCOR.(2) Whether or not public demonstrations and rallies could be considered as fortuitous
events that would exempt the PAGCOR from complying with its contractual obligations.
HELD:(1) YES. The actions and pleadings of PPC show that it never intended to rescind the Lease
Contract from the beginning. This fact was evident when it first sought to collect the accrued rentals
from September to November 1993 because, as previously stated, it actually demanded the enforcement
of the Lease Contract prior to termination. Any intent to rescind was not shown, even when it
abrogated the Contract on November 25,1993, because such abrogation was not the rescission
provided for under Article 1659. The termination of a contract is not equivalent to its rescission. When
an agreement is terminated, it is deemed valid anticipation. Prior to termination, the contract binds the
parties, who are thus obliged to observe its provisions. However, when it is rescinded, it is deemed
inexistent, and the parties are returned to their status quo ante. Hence, there is mutual restitution of
benefits received. The consequences of termination may be anticipated and provided for by the
contract. As long as the terms of the contract are not contrary to law, morals, good customs, public
order or public policy, they shall be respected by courts. The judiciary is not authorized to make or
modify contracts; neither may it rescue parties from disadvantageous stipulations. Courts, however,
are empowered to reduce iniquitous or unconscionable liquidated damages, indemnities and penalties
agreed upon by the parties. Future rentals cannot be claimed as compensation for the use or enjoyment
of another's property after the termination of a contract. We stress that by abrogating the Contract in
the present case, PPC released PAGCOR from the latter's future obligations, which included the
payment of rentals. To grant that right to the former is to unjustly enrich it at the latter's expense.(2)
NO. In this case, PAGCOR's breach was occasioned by events that, although not fortuitous in law,
were in fact real and pressing. From the CA's factual findings, which are not contested by either party,
we find that PAGCOR conducted a series of negotiations and consultations before entering into the
Contract. It did so not only with the PPC, but also with local government officials, who assured it that
the problems were surmountable. Likewise, PAGCOR took pains to contest the ordinances before the
courts, which consequently declared them unconstitutional. On top of these developments, the gaming
corporation was advised by the Office of the President to stop the games in Cagayan de Oro City,
prompting the former to cease operations prior to September 1993.RATIO:(1) PPC anchors its right to
collect future rentals upon the provisions of the Contract. Likewise, it argues that termination ,as
defined under the Contract, is different from the remedy of rescission prescribed under Article 1659 of
the Civil Code. On the other hand, PAGCOR contends, as the CA ruled, that Article1659 of the Civil
Code governs; hence, PPC is allegedly no longer entitled to future rentals, because it chose to rescind
the Contract. Article 1159 of the Civil Code provides that "obligations arising from contracts have the
force of law between the contracting parties and should be complied with in good faith." In deference
to the rights of the parties, the law allows them to enter into stipulations, clauses, terms and conditions
they may deem convenient; that is, as long as these are not contrary to law, morals, good customs,
public order or public policy. Likewise, it is settled that if the terms of the contract clearly express the
intention of the contracting parties, the literal meaning of the stipulations would be controlling. In this
case, Article XX of the parties' Contract of Lease provides in part as follows: "XX. BREACH OR
DEFAULT "a)The LESSEE agrees that all the terms, conditions and/or covenants herein contained
shall be deemed essential conditions of this contract, and in the event of default or breach of any of
such terms, conditions and/or covenants , or should the LESSEE become bankrupt, or insolvent, or
compounds with his creditors, the LESSOR shall have the right to terminate and cancel this contract by
giving them fifteen (15 days) prior notice delivered at the leased premises or posted on the main door
thereof. Upon such termination or cancellation, the LESSOR may forthwith lock the premises and
exclude the LESSEE therefrom, forcefully or otherwise, without incurring any civil or criminal
liability. During the fifteen (15)days notice, the LESSEE may prevent the termination of lease by curing
the events or causes of termination or cancellation of the lease. "b). . ."c Moreover, the LESSEE shall
be fully liable to the LESSOR for the rentals corresponding to there maining term of the lease as well
as for any and all damages, actual or consequential resulting from such default and termination of this
contract. "d). . . " (Italics supplied) The above provisions show that the parties have covenanted 1)to
give PPC the right to terminate and cancel the Contract in the event of a default or breach by the
lessee; and 2) to make PAGCOR fully liable for rentals for the remaining term of the lease, despite the
exercise of such right to terminate. Plainly, the parties have voluntarily bound themselves to require
strict compliance with the provisions of the Contract by stipulating that a default or breach, among
others, shall give the lessee the termination option, coupled with the lessor's liability for rentals for the
remaining term of the lease. Section XX (c) was intended to be a penalty clause. That fact is manifest
from a reading of the mandatory provision under subparagraph (a) in conjunction with subparagraph
(c) of the Contract. A penal clause is "an accessory obligation which the parties attach to a principal
obligation for the purpose of insuring the performance thereof by imposing on the debtor a special
prestation (generally consisting in the payment of a sum of money) in case the obligation is not fulfilled
or is irregularly or inadequately fulfilled." In obligations with a penal clause, the general rule is that
the penalty serves as a substitute for the indemnity for damages and the payment of interests in case of
noncompliance; that is, if there is no stipulation to the contrary, in which case proof of actual damages
is not necessary for the penalty to be demanded. There are exceptions to the aforementioned rule,
however, as enumerated in paragraph 1 of Article 1226 of the Civil Code: 1) when there is a
stipulation to the contrary, 2) when the obligor is sued for refusal to pay the agreed penalty, and 3)
when the obligor is guilty of fraud. In these cases, the purpose of the penalty is obviously to punish he
obligor for the breach. Hence, the obligee can recover from the former not only the penalty, but also
other damages resulting from the nonfulfillment of the principal obligation. In the present case, the
first exception applies because Article XX (c) provides that, aside from the payment of the rentals
corresponding to the remaining term of the lease, the lessee shall also be liable "for any and all
damages, actual or consequential, resulting from such default and termination of this contract."
Having entered into the Contract voluntarily and with full knowledge of its provisions, PAGCOR must
be held bound to its obligations. It cannot evade further liability for liquidated damages. In certain
cases, however, a stipulated penalty may nevertheless be equitably reduced by the courts. This power is
explicitly sanctioned by Articles 1229 and 2227 of the Civil Code, which we quote: "Art. 1229.The
judge shall equitably reduce the penalty when the principal obligation has been partly or irregularly
complied with by the debtor. Even if there has been no performance, the penalty may also be reduced
by the courts if it is iniquitous or unconscionable." "Art. 2227.Liquidated damages, whether intended
as an indemnity or a penalty, shall be equitably reduced if they are iniquitous or unconscionable." The
question of whether a penalty is reasonable or iniquitous is addressed to the sound discretion of the
courts. To be considered in fixing the amount of penalty are factors such as but not limited to the
type, extent and purpose of the penalty; the nature of the obligation; the mode of the breach and its
consequences; the supervening realities; the standing and relationship of the parties; and the like.

ANG YU V. CA (December 02, 1994)
FACTS:
Petitioner Ang Yu Asuncion and Keh Tiong leased a property of respondents Bobby Cu Unjieng, Rose
Cu Unjieng and Jose Tan in Binondo Manila.

Respondents informed plaintiffs that they are offering to sell the premises and are giving them priority
to acquire the same.

Respondents 6M for the property but petitioners offered 5M. Respondents acceted and asked
petitioners to put in writing the terms and conditions but the latter never provided such.

When defendants were about to sell the property, plaintiffs were compelled to file the complaint to
compel defendants to sell the property to them. Court recognizes the right of first refusal of the
petitioner. Notwithstanding the courts decision, respondent sold the property to Buen Realty and
Development Corporation.

ISSUE:
WON petitioners can demand specific performance to the respondents to sell to them the property.

HELD:
The petitioners never accepted the offer when they refused to make the terms and condition of the sale.
As such, respondents has the right to sell the property to other parties.

Even if petitioners are aggrieved by the failure of private respondents to honor the right of first refusal,
the remedy is not a writ of execution on the judgment, since there is none to execute, but an action for
damages in a proper forum for the purpose