G.R. No.

170405 February 2, 2010

RAYMUNDO S. DE LEON, Petitioner,
vs.
BENITA T. ONG. Respondent.
Facts:
On March 10, 1993, Raymundo S. De Leon (petitioner) sold 3 parcels of land to Be
nita T. Ong(respondent). The said properties were mortgaged to a financial insti
tution; Real Savings & Loan Association Inc. (RSLAI). The parties then executed
a notarized deed of absolute sale with assumption of mortgage. As indicated in t
he deed of mortgage, the parties stipulated that the petitioner (de Leon) shall
execute a deed of assumption of mortgage in favor of Ong (respondent)after full
payment of the P415,000. They also agreed that the respondent (Ong) shall assume
the mortgage. The respondent then subsequently gave petitioner P415,000 as part
ial payment. On the other hand, de Leon handed the keys to Ong and de Leon wrote
a letter to inform RSLAI that the mortgage will be assumed by Ong. Thereafter,
the respondent took repairs and made improvements in the properties. Subsequentl
y, respondent learned that the same properties were sold to a certain Viloria af
ter March 10, 1993 and changed the locks, rendering the keys given to her useles
s. Respondent proceeded to RSLAI but she was informed that the mortgage has been
fully paid and that the titles have been given to the said person. Respondent t
hen filed a complaint for specific performance and declaration of nullity of the
second sale and damages. The petitioner contended that respondent does not have
a cause of action against him because the sale was subject to a condition which
requires the approval of RSLAI of the mortgage. Petitioner reiterated that they
only entered into a contract to sell. The RTC dismissed the case. On appeal, th
e CA upheld the sale to respondent and nullified the sale to Viloria. Petitioner
moved for reconsideration to the SC.
Issue:
Whether the parties entered into a contract of sale or a contract to sell?
Held:
In a contract of sale, the seller conveys ownership of the property to the buyer
upon the perfection of the contract. The non-payment of the price is a negative
resolutory condition. Contract to sell is subject to a positive suspensive cond
ition. The buyer does not acquire ownership of the property until he fully pays
the purchase price.In the present case, the deed executed by the parties did not
show that the owner intends to reserve ownership of the properties. The terms a
nd conditions affected only the manner of payment and not the immediate transfer
of ownership. It was clear that the owner intended a sale because he unqualifie
dly delivered and transferred ownership of the properties to the respondent