TAGUBA v. VDA DE DE LEON (No.
L-59980) agreed with the CA by saying Taguba had no right to rescind the
Promulgated: October 23 1894
Petitioners: Berlin Taguba & Sebastiana Domingo (spouses), Pedro &
Maring Asuncion (spouses)
Respondents: Maria Peralta Vda. De De Leon, Court of Appeals
Relevant Provisions:
Article 1592 of the Civil Code
In the sale of immovable property, even though it may have been
stipulated that upon failure to pay the price at the time agreed upon the
rescission of the contract shall of right take place, the vendee may pay,
even after the expiration of the period, as long as no demand for
rescission of the contract has been made upon him either judicially or
by a notarial act. xxx
Quick Summary of the Case:
Portions of Taguba’s lot were leased to the Asuncions and De Leon.
Taguba sold 400 sq m to De Leon through a Deed of Conditional Sale.
De Leon was unable to pay the full amount by the agreed time. She
tried to pay the balance within the extension given to her but Taguba
refused her payment. Allegedly with De Leon’s approval, Taguba sold
the portion of the lot actually occupied by the Asuncions to them. De
Leon filed a complaint with the CFI of Isabela which rendered a
decision that De Leon had to pay only for the portion of the lot she
actually owns. The CA reversed this by saying that De Leon had the
right to the 400 sq m lot and voiding the sale to the Asuncions. The SC
contract pursuant to Article 1592 of the Civil Code because he did not
demand for the rescission of contract and because De Leon was able to
pay the full amount for the lot and that the Asuncions were not buyers
in good faith because they knew of the previous sale to De Leon.
Facts:
 Taguba has a residential lot in Cauayan, Isabela, portions of which
he leased to the Asuncions and De Leon.
 Taguba sold 400 sq m of the lot, which includes the part leased by
the Asuncions, to De Leon through a Deed of Conditional Sale. This
stipulated that De Leon will pay ₱18,000 to Taguba until Dec 3
1972, and if unable to fully pay by then, De Leon will be given an
extension of 6 months to pay with interest.
 De Leon was able to pay ₱12,500 by Dec 1972. She tried to pay the
balance of ₱5,500 on May 1973 but Taguba refused her payment.
 Spouses Taguba and De Leon had a negotiation for settlement. De
Leon alleges that this failed. The spouses allege that in this
negotiation De Leon proposed that the portion actually occupied by
the Asuncions will be sold to them.
 Taguba executed a Deed of Sale to the Asuncions which covered the
portion of the lot actually occupied by the spouses.
 De Leon filed a complaint for a Specific Performance with
Preliminary Mandatory Injunction with damages against the spouses
Taguba in the CFI of Isabela.
 The Asuncions intervened and alleged that they bought in good faith
the portion of the land that they actually occupy.
 The CFI made a decision ordering Taguba to execute a deed of
absolute sale in favor of De Leon only of the portion of the lot she
actually occupies.
 This was appealed to the CA which reversed the CFI decision by
ordering Taguba to execute the deed of sale for the 400 sq m
originally agreed upon and declared that the deed of sale issued to
the Asuncions was null and void.
 Petitioners filed an MR which was denied and thus filed this Review
on Certiorari to the SC
Issue: (Derived)
W/N Taguba had the right to rescind the contract? - NO
W/N the sale to the Asuncions was valid? - NO
W/N the Asuncions were buyers in good faith - NO
Held/Ratio:
The applicable provision is Article 1592 of the Civil Code. This
provides that the vendee may pay even after the expiration of the
period, as long as no demand for rescission of the contract has been
made upon him either judicially or by a notarial act.
In the case at bar, Taguba didn’t have the right to rescind the contract
with De Leon even if she was unable to pay within the fixed period,
pursuant to Art 1592 because he did not demand for a rescission of the
contract, and De Leon was willing to pay for the whole amount. Also,
there was no stipulation in the contract that Taguba could unilaterally
rescind the contract if De Leon is unable to pay.
Araneta v. Paterno provides that “where time is not of the essence of
the agreement, a slight delay on the part of one party in the
performance of his obligation is not a sufficient ground for the
rescission of the agreement”.
This applies to the case at bar since De Leon had actually tried to
complete the payment thus only making it a delay on her part, and she
did this within the extension period stated in the contract.
Even if it was called a Deed of Conditional Sale, a reading of the
contract would show that it was absolute in nature. The contract only
gave Taguba the right to collect interest. This makes the sale to De
Leon absolute, and the sale to the Asuncions invalid. The Asuncions
were not buyers in good faith because they were aware of the earlier
sale to De Leon.
Ruling
The judgment of CA is affirmed.