G.R. No.

L-10141

January 31, 1958

REPUBLIC OF THE PHILIPPINES, petitioner,

vs.
PHILIPPINE RESOURCES DEVELOPMENT CORPORATION and
the COURT OF APPEALS, respondents
FACTS:
MacarioApostol, allegedly acting for the Philippine Resources
Development Corp. (PRDC), contracted with the Bureau of Prison
for the purchase of 100 tons of designated logs, but only a small
payment of the purchase price was made. In lieu of the balance
of the purchase price, he caused to be delivered goods of the
PRDC to the Bureau of Prison as payment for the outstanding
price. The Government asserted that the subject matter of its
litiga tion with Apostol was a sum of money allegedly due to the
Bureau of Prison from Apostol and not the goods reportedly
turned over by Apostol in payment of his private debt to the
Bureau of Prison and the recovery of which was sought by PRDC;
and for this reason, PRDC had no legal interest in the very subject
matter in litigation as to entitle it to intervene. The Government
argued that the goods which belonged to PRDC were not
connected with the sale because Price ... is always paid in terms
of money and the supposed payment being in kind, it is no
payment at all

ISSUE: Whether PRDC had the right to intervene in the sales

transaction executed between Apostol and the Bureau of Prisons
and in the suit brought by the Government to enforce such sale.

HELD:
The Court held that the Governments contentions were
untenable, ruling that Article 1458 provides that the purchaser
may pay a price certain in money or its equivalent, which
means payment of the price need not be in money. Whether the
goods claimed by PRDC belong to it and delivered to the Bureau

of Prison by Apostol in payment of his account is sufcient

payment therefor, is for the court to pass upon and decide after
hearing all the parties in the case. PRDC therefore had a positive
right to intervene in the case because should the trial court credit
Apostol with the value price of the materials delivered by him,
certainly PRDC would be affected adversely if its claim of
ownership to such goods were upheld.
Republic is not at all authority to say that under Article 1458,
as it de nes a contract of sale, the term equivalent of price can
cover other than money or other media of exchange, since
Republic covers not the perfection stage of a contract of sale, but
rather the consummation stage where the price agreed upon
(which ideally should be in money or its equivalent) can be paid
under the mutual arrangements agreed upon by the parties to the
contract of sale, even by dation in payment, as was the case in
Republic.

MUNICIPALITY OF VICTORIAS, petitioner,

vs.
THE COURT OF APPEALS, NORMA LEUENBERGER and
FRANCISCO SOLIVA, respondents.

G.R. No. L-31189 March 31, 1987

FACTS:
Respondent Norma Leuenberger, married to Francisco Soliva,
inherited the whole of Lot No. 140 from her grandmother,
Simeona J. Vda. de Ditching (not from her predeceased mother
Isabel Ditching). In 1952, she donated a portion of Lot No. 140,
about 3 ha., to the municipality for the ground of a certain high
school and had 4 ha. converted into a subdivision. (TSN, July 1,
1964, p. 24).

In 1963, she had the remaining 21 ha. or 208.157 sq. m. relocated

by a surveyor upon request of lessee Ramon Jover who
complained of being prohibited by municipal officials from
cultivating the land. It was then that she discovered that the
parcel of land, more or less 4 ha. or 33,747 sq.m. used by
Petitioner Municipality of Victorias, as a cemetery from 1934, is
within her property which is now Identied as Lot 76 and covered
by TCT No. 34546.
On January 11, 1964, Respondents led a complaint in the Court
of First Instance of Negros Occidental, Branch 1, for recovery of
possession of the parcel of land occupied by the municipal
cemetery (Record on Appeal, p. 1). In its answer, petitioner
Municipality, by way of special defense, alleged ownership of the
lot, subject of the complaint, having bought it from Simeona
Jingco Vda. de Ditching sometime in 1934 (Record on Appeal, p.
7). The lower court decided in favor of the Municipality. On appeal
Respondent appellate Court set aside the decision of the lower
court (Record on AppeaL p. 9); hence, this petition for review on
certiorari.

ISSUE:
WON the evidence presented by the petitioner municipality is
sufficient to substantiate its claim that it acquired the disputed
land by means of a Deed of Sale.

HELD:

The court held that testimonies and documentary evidence

presented sufficiently identify the land sold by the predecessorsin-interest of private respondent. To insist on the technical
description of the land in dispute would be to sacrice substance
to form which would undoubtedly result in manifest injustice to
the petitioner.

Moreover, it is expressly provided by law that the thing sold shall

be understood as delivered, when it is placed in the control and
possession of the vendee. (Civil Code Art. 1497). Where there is

no express provision that title shall not pass until payment of the
price, and the thing gold has been delivered, title passes from the
moment the thing sold is placed in the possession and control of
the buyer. (Kuenzle & Streiff vs. Watson & Co., 13 PhiL 26 [1909]).
Delivery produces its natural effects in law, the principal and most
important of which being the conveyance of ownership, without
prejudice to the right of the vendor to payment of the price.
(Ocejo, Perez & Co. vs. International Banking Corp., 37 PhiL 631
[1918]).

Similarly, when the sale is made through a public instrument, the

execution thereof shall be equivalent to the delivery of the thing
which is the object of the contract, if from the deed, the contrary
does not appear or cannot be clearly inferred. (Civil Code Art.
1498). The execution of the public instrument operates as a
formal or symbolic delivery of the property sold and authorizes
the buyer to use the document as proof of ownership. (Florendo v.
Foz, 20 PhiL 388 [1911]).

In the case at bar it is undisputed that petitioner had been in

open, public, adverse and continuous possession of the land for a
period of more than thirty years. In fact, according to the
municipal treasurer there are over 1000 graves in the cemetery.

Delta Motors Sales vs. Niu Kim Duan

G.R. No. 61043. September 2, 1992.]
Facts:
On 5 July 1975, Niu Kim Duan and Chan Fue Eng (defendants)
purchased from Delta Motor Sales
Corporation 3 units of DAIKIN air-conditioner all valued at
P19,350.00. The deed of sale stipulates that the defendants shall
pay a down payment of P774.00 and the balance of P18,576.00

shall be paid by them in 24 installments ; that the title to the

properties purchased shall remain with Delta Motors until the
purchase price thereof is fully paid; that if any two installments
are not paid by the defendants on their due dates, the whole of
the principal sum remaining unpaid shall become due, with
interest
However, after paying the amount of P6,966.00, the
defendants failed to pay at least 2 monthly installments. s of 6
January 1977, the remaining unpaid obligation of the defendants
amounted to P12,920.08. Statements of accounts were sent to
the defendants and the Delta Motors collectors personally went
to the former to effect collections but they failed to do so.
Because of the unjustied refusal of the defendants to pay their
outstanding account and their wrongful detention of the
properties in question, Delta Motors tried to recover the said
properties extra-judicially but it failed to do so. The matter was
later referred by Delta Motors to its legal counsel for legal action.
In its veried complaint dated 28 January 1977, Delta Motors
prayed for the issuance of a writ of replevin, which the Court
granted in its Order dated 28 February 1977, after Delta Motors
posted the requisite bond. On 11 April 1977, Delta Motors, by
virtue of the writ, succeeded in retrieving the properties in
question. The trial court promulgated its decision on 11 October
1977 ordering the defendants to pay Delta Motors the amount of
P6,188.29 with a 14% per annum interest which was due on the 3
Daikin air-conditioners the defendants purchased from Delta
Motors under a Deed of Conditional Sale, after the same was
declared rescinded by the trial court. They were likewise ordered
to pay Delta Motors P1,000.00 for and as attorneys fees.

ISSUE:
WON the lower court erred in its decision to order the defendants
to pay the unpaid balance despite the fact that Delta motors
already retrieved the subject properties.

HELD:

The court held that remedies available to vendor in a sale of

personal property payable in installments The vendor in a sale of
personal property payable in installments may exercise one of
three remedies, namely, (1) exact the fulllment of the obligation,
should the vendee fail to pay; (2) cancel the sale upon the
vendees failure to pay two or more installments; (3) foreclose the
chattel mortgage, if one has been constituted on the property
sold, upon the vendees failure to pay two or more installments.
The third option or remedy, however, is subject to the limitation
that the vendor cannot recover any unpaid balance of the price
and any agreement to the contrary is void (Art. 1484).
Moreover, the 3 remedies are alternative and NOT cumulative. If
the creditor chooses one remedy, he cannot avail himself of the
other two.
Thus in the case at bar, Air-conditioning units repossessed, bars
action to exact payment for balance of the price Delta Motors had
taken possession of the 3 air-conditioners, through a writ of
replevin when defendants refused to extra-judicially surrender the
same. The case Delta Motors led was to seek a judicial
declaration that it had validly rescinded the Deed of Conditional
Sale. Delta Motors thus chose the second remedy of Article 1484
in seeking enforcement of its contract with defendants. Having
done so, it is barred from exacting payment from defendants of
the balance of the price of the three air-conditioning units which it
had already repossessed. It cannot have its cake and eat it too.

G.R. No. 119745

June 20, 1997

POWER COMMERCIAL AND INDUSTRIAL CORPORATION,

petitioner,
vs.
COURT OF APPEALS, SPOUSES REYNALDO and ANGELITA R.
QUIAMBAO and PHILIPPINE NATIONAL BANK, respondents.

FACTS:
Petitioner Power Commercial & Industrial Development
Corporation entered into a contract of sale involving a 612-sq. m.
parcel of land with the spouses Reynaldo and Angelita R.
Quiambao, herein private respondents. The parties agreed that
petitioner would pay private respondents P108,000.00 as down
payment, and the balance of P295,000.00 upon the execution of
the deed of transfer of the title over the property. Further,
petitioner assumed, as part of the purchase price, the existing
mortgage on the land. In full satisfaction thereof, he paid
P79,145.77 to respondent Philippine National Bank (PNB for
brevity).

On June 1, 1979, respondent spouses mortgaged again said land

to PNB to guarantee a loan of P145,000.00, P80,000.00 of which
was paid to respondent spouses. Petitioner agreed to assume
payment of the loan. On February 15, 1980, PNB informed
respondent spouses that, for petitioners failure to submit the
papers necessary for approval pursuant to the formers letter

dated January 15, 1980, the application for assumption of

mortgage was considered withdrawn.

On February 19, 1982, PNB sent petitioner informing him that the
loan has been past due from last maturity with interest arrearages
amounting to P25,826.08 as of February 19, 1982. PNB further
requested petitioner to remit payments to cover interest, charges,
and at least part of the principal.

On March 17, 1982, petitioner led Civil Case No. 45217 against
respondent spouses for rescission and damages before the
Regional Trial Court of Pasig, Branch 159. Then, in its reply to
PNBs letter of February 19, 1982, petitioner demanded the return
of the payments it made on the ground that its assumption of
mortgage was never approved. On May 31, 1983, while this case
was pending, the mortgage was foreclosed. The property was
subsequently bought by PNB during the public auction.

On July 12, 1990, the trial court ruled that the failure of
respondent spouses to deliver actual possession to petitioner
entitled the latter to rescind the sale, and in view of such failure
and of the denial of the latters assumption of mortgage, PNB was
obliged to return the payments made by the latter. On appeal by
respondent-spouses and PNB, Respondent Court of Appeals
reversed the trial court.

ISSUES
1. Whether or not there was a substantial breach of the contract
between the parties warranting rescission
2. Whether or not there was a mistake in payment made by
petitioner, obligating PNB to return such payments.

HELD
1. The alleged failure of respondent spouses to eject the lessees
from the lot in question and to deliver actual and physical

possession thereof cannot be considered a substantial breach of a

condition for two reasons: rst, such failure was not stipulated
as a condition whether resolutory or suspensive in the
contract; and second, its effects and consequences were not
specied either.
If the parties intended to impose on respondent spouses the
obligation to eject the tenants from the lot sold, it should have
included in the contract a provision similar to that referred to in
Romero vs. Court of Appeals, where the ejectment of the
occupants of the lot sold by private respondent was the operative
act which set into motion the period of petitioners compliance
with his own obligation.

As stated, the provision adverted to in the contract pertains to the

usual warranty against eviction, and not to a condition that was
not met. The terms of the contract are so clear as to leave no
room for any other interpretation.

2. Contrary to the contention of petitioner that a return of the

payments it made to PNB is warranted under Article 2154 of the
Code, solutio indebiti does not apply in this case. This doctrine
applies where: (1) a payment is made when there exists no
binding relation between the payor, who has no duty to pay, and
the person who received the payment, and (2) the payment is
made through mistake, and not through liberality or some other
cause.

In this case, petitioner was under obligation to pay the

amortizations on the mortgage under the contract of sale and the
deed of real estate mortgage. Under the deed of sale, both parties
agreed to abide by any and all the requirements of PNB in
connection with the real estate mortgage. Petitioner was aware
that the deed of mortgage made it solidarily and, therefore,
primarily liable for the mortgage obligation. Therefore, it cannot
be said that it did not have a duty to pay to PNB the amortization
on the mortgage.
Also, petitioner insists that its payment of the amortization was a
mistake because PNB disapproved its assumption of mortgage

after it failed to submit the necessary papers for the approval of

such assumption. But even if petitioner was a third party in regard
to the mortgage of the land purchased, the payment of the loan
by petitioner was a condition clearly imposed by the contract of
sale. This fact alone disproves petitioners insistence that there
was a mistake in payment. On the contrary, such payments
were necessary to protect its interest as a the buyer(s) and new
owner(s) of the lot.

GERARDA A. DIZON-ABILLA and the HEIRS OF RONALDO P.

ABILLA v. SPS. CARLOS
AND THERESITA GOBONSENG
577 SCRA 401 (2009
FACTS:
Gerarda A. Dizon-Abilla and the Heirs of Ronaldo P. Abilla
extended to Spouses Carlos and Theresita Gobonseng a loan in
the amount of Five Hundred Fifty Thousand Pesos (P550, 000.00).
Spouses Gobonseng, however, failed to settle the same. They
then executed a Deed of Sale covering Seventeen (17) lots in
favor of Dizon-Abilla and Heirs of Abilla. The Deed provides an
option to buy the lots within six (6) months in favor of Spouses
Gobonseng which they failed to exercise.
Dizon-Abilla and Heir of Abilla led a case of specic performance
and damages for the expenses attendant to the Preparation and
Registration of the Deed of Sale. The RTC of Dumaguete City
ruled the option to buy was null and void. On appeal, the Court of
Appeals affirmed the trial courts decision. Nineteen (19) days
after the decision of the CA became nal, an Urgent
Motion to Repurchase was led to the trial court by Spouses
Gobonseng alleging that they made a tender of payment to RCBC
Dumaguete Branch, but was denied. The case was raffled to a
new judge which ordered the release of the deposited money as
payment for the repurchase. Dizon-Abilla and Heirs of Abilla led
a Petition for Review on Certiorari challenging the trial courts
decision allowing Spouses Gobonsengs repurchase.
The Supreme Court denied their petition. Dizon-Abilla and Heirs of
Abilla subsequently led another case to the trial court asserting
that they are entitled to 2% monthly interest. The trial court ruled
in favor of Spouses Gobonseng which was affirmed by the CA. The
appellate court ruled that the case has already been closed and
terminated.

ISSUE: Whether or not the Court of Appeals erred in its decision

to consider the case closed and terminated
HELD: The amount tendered by Spouses Domonseng, the
correctness of which had already been passed upon by the
appellate court, has been determined with nality.
Every litigation must necessarily come to an end. Access to courts
is guaranteed, but once a litigants right has been adjudicated in
a valid nal judgment of a competent court, he should not be
granted an unbridled license to go back for another try. The
prevailing party should not be harassed by subsequent suits. For,
if endless litigations were to be encouraged, unscrupulous
litigations would multiply in number to the detriment of the
administration of justice.

SORIANO V. BAUTISTA 6 SCRA 946 (1962)

FACTS: Spouses Bautista are the absolute and registered owners
of a parcel of land. In May 30, 1956, the said spouses entered into
an agreement entitled Kasulatan ng Sanglaan (mortgage) in
favor of spouses Soriano for the amount of P1,800.
Simultaneously with the signing of the deed, the spouses Bautista
transferred the possession of the subject property to spouses
Soriano. The spouses Soriano have, since that date, been in
possession of the property and are still enjoying the produce
thereof to the exclusion of all other persons
1.
Sometime after May 1956, the spouses Bautista received
from spouses Soriano the sum of P450 pursuant to the conditions
agreed upon in the document. However, no receipt was issued.
The said amount was returned by the spouses Bautista
2.
In May 13, 1958, a certain Atty. Ver informed the spouses
Bautista that the spouses Soriano have decided to purchase the
subject property pursuant to par. 5 of the document which states
that the mortgagees may purchase the said land absolutely
within the 2-year term of the mortgage for P3,900.
3. Despite the receipt of the letter, the spouses Bautista refused
to comply with Sorianos demand
4.
As such, spouses Soriano led a case, praying that they be
allowed to consign or deposit with the Clerk of Court the sum of

P1,650 as the balance of the purchase price of the land in

question
5.
The trial court held in favor of Soriano and ordered Bautista
to execute a deed of absolute sale over the said property in favor
of Soriano.
6.
Subsequently spouses Bautista led a case against Soriano,
asking the court to order Soriano to accept the payment of the
principal obligation and release the mortgage and to make an
accounting the harvest for the 2 harvest seasons (1956-1957).
7.
CFI held in Sorianos favor and ordered the execution of the
deed of sale in their favor
8. Bautista argued that as mortgagors, they cannot be deprived
of the right to redeem the mortgaged property, as such right is
inherent in and inseparable from a mortgage.

ISSUE: WON spouses Bautista are entitled to redemption of

subject property

HELD:
No. While the transaction is undoubtedly a mortgage and
contains the customary stipulation concerning redemption, it
carries the added special provision which renders the mortgagors
right to redeem defeasible at the election of the mortgagees.
There is nothing illegal or immoral in this as this is allowed under
Art 1479 NCC which states: A promise to buy and sell a
determinate thing for a price certain is reciprocally demandable.
An accepted unilateral promise to buy or to sell a determinate
thing for a price certain is binding upon the promissor if the
promise supported by a consideration apart from the price.

In the case at bar, the mortgagors promise is supported by the

same consideration as that of the mortgage itself, which is
distinct from the consideration in sale should the option be
exercised. The mortgagors promise was in the nature of a
continuing offer, non-withdrawable during a period of 2 years,

which upon acceptance by the mortgagees gave rise to a

perfected contract of sale.

Furthermore, the tender of P1,800 to redeem the mortgage by

spouses Bautista was ineffective for the purpose intended. Such
tender must have been made after the option to purchase had
been exercised by spouses Soriano. Bautistas offer to redeem
could be defeated by Sorianos preemptive right to purchase
within the period of 2 years from May 30, 1956. Such right was
availed of and spouses Bautista were accordingly notied by
Soriano. Offer and acceptance converged and gave rise to a
perfected and binding contract of purchase and sale.