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Balila v.

IAC
GR No. L-68477
October 29, 1987
Paras, J.

DOCTRINE Novation can be ascertained through the subsequent agreements and actions of the parties.

Nature of the Case:Petition for Review on Certiorari on the decision of Intermediate Appellate Court
affirming RTC decision which ordered consolidation ownership in favor of private respondents over 2
parcels of land.

FACTS:
Spouses Anita Balila, Editha S. De Guzman Honorable Florante S. Abasolo, as Judge of RTC
Spouses Asterio de Guzman, Erlinda Concepcion Guadalupe C. vda. De del Castillo
Encarnacion Ocampo vda. De Concepcion Waldo del Castillo

 December 11, 1980, Trial Court: approved and ordered the compliance of the amicable
settlement between petitioners and private respondents.
 Petitioners sold under pacto de retro sale parcels of land for P84k
o Promised to pay within a period of four months, but not later than May 15, 1981
 Petitioners redeemed one Lot (out of three) by paying P20k

 Respondent filed a motion for hearing on the consolidation of title alleging that Dec. 11, 1980
decision was unenforced
 Petitioners alleging they had made partial payments
 Lower Court, in April 26, 1983 issued order affirming consolidation
 June 8, 1983, petitioners paid private respondents P28,800
 Motions for reconsiderations re decision of consolidation was denied in the lower court.
 Petitioners filed petition for certiorari before IAC
 IAC sustained the lower court, hence the present petition

In short, even after non-compliance with the amicable settlement, the petitioners continued paying
obligation (partially) and such payments were accepted by Waldo del Castillo. Such partial payments
were being made while cases were before lower court.

Before tackling the issue stated here, Court settled issue whether or not Waldo del Castillo was person
authorized by Guadalupe del Castillo (because she denied giving him authority); but as stated in records
of lower courts which were recognized by IAC, "Guadalupe vda. De del Castillo, represented by her
attorney in fact Waldo Castillo"

ISSUE: WoN the subsequent mutual agreements and actions of private petitioners and private
respondents novated and amended the compromise in the amicable settlement. ---YES

RULING:
 The amount of P84,000 payable on or before May 15, 1981 decreed by trial court in its judgment
by compromise was novated and amended by the subsequent mutual agreements and actions of
petitioners and private respondents.
 Petitioners paid on installment basis and they were given by private respondents no less than 8
extensions of time to pay their obligation.
 Transactions took place during pendency of motion for reconsideration.

DISPOSITIVE
WHEREFORE, finding merit in the petition, the same is hereby given DUE COURSE and the assailed
decision, SET ASIDE. Private respondents are hereby ordered reconvey and deliver Lot No. 965 and
Lot No. 16 as covered by TCT No. 146360 and 146361 respectively in favor of petitioners. Should
private respondents fail to do so, the Clerk of Court of the Regional Trial Court concerned is
ordered to execute the necessary deed of reconveyance, conformably with the provisions of the
Rules of Court. The local Register of Property is ordered to register said deed of reconveyance.
Private respondents are hereby authorized to withdraw the balance in the amount of P10,000
consigned by petitioners on January 9, 1985 with the trial court as per OR No. 9764172 (Annex
"O") a full payment of petitioners' obligation.
This decision is immediately executory and no motion for extension of the period within which to
file a motion for reconsideration will be granted.
SO ORDERED.