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THURSDAY, SEPTEMBER 27, 2012 BLOG ARCHIVE
►  2016 (3)
case digest submitted by zosa ►  2014 (21)

  ▼  2012 (176)
  ►  December (4)
INSURANCE LIFE ASSURANCE COMPANY, LTD. VS. ASSET BUILDERS ►  November (38)
CORPORATION
►  October (62)
G.R. No. 147410, February 5, 2004
▼  September (18)

Facts: ebal digest

Insular Life Insurance Company, Limited invited companies to participate in nalzaro digest

the bidding of the proposed Insular Life building. The Instruction to Bidders case digest submitted by zosa
prepared by Insular Life expressly required a formal acceptance and a period
coverage of the semi­finals : art 1600­
within which such acceptance was to be made known to the winner. Asset Builders 1635
Corporation submitted a bid proposal secured by bid bonds valid for 60 days.
case digest 3 cases
Under its proposal form, Asset Builders bound and obliged itself to enter into a
contract with Insular Life within 10 days from the notice of the award, with good case digest of manogura : de guzman
v. toyota
and sufficient securities. The project was awarded to the Asset Builders and a
notice to proceed with the construction was sent by Insular Life to the former. forged document of sale may become
the root of a v...
However, Asset Builders project. Neither did it execute any construction
agreement. It informed Insular Life that it will not proceed with the project. doctrine of innocent purchaser.”
case digests 1: compendium
Issue: SIBAL v. VALDEZ
Whether or not there is a perfected contract between Insular Life and
CIR v. AICHI FORGING COMPANY
Asset Builders. OF ASIA, INC.
COCA­COLA V. CA.; (1993)Case
Held: Digest no. 3
There was indeed no acceptance of the offer by Asset Builders. Such
CEBU SALVAGE; VILLANUEVA V.
failure to comply with the condition imposed for the perfection of the contract CHIONG; case digest by...
resulted in the failure of the contract. It is elementary that, being consensual, a
DE GUZMAN V. TOYOTA; COCA­
contract is perfected by mere consent. From the moment of a meeting of the
COLA V. GERONIMO;VILLOST...
offer and the acceptance upon the object and the cause that would constitute the
contract, consent arises. However, "the offer must be certain" and "the cebu salvage v. home assurance;case
digest by a. n...
acceptance seasonable and absolute; if qualified, the acceptance would merely
constitute a counter-offer." RADIOWEALTH; GABRIEL; DE
LEONcase digest of Julian...
There are three distinct stages of a contract- preparation or negotiation,
perfection or consummation. Negotiation begins when the prospective contracting MAGNA, VILLOSTAS, ATIENZA ­­
case digest by Dennis ...
parties manifest their interest in the contract and ends at the moment of their
agreement. Perfection occurs when they agree upon the essential elements DE GUZMAN, MAGNA, VILLOSTAS
Case digest submitte...
thereof. The last stage is the consummation where they fulfill the terms agreed
upon culminating in the extinguishment of the contract. ►  August (7)
In the case at bar, the parties did not get past the negotiation stage.
►  July (41)
In fact, there was only an offer and a counteroffer that did not sum up to
any final arrangement containing the elements of a contract. Clearly, no meeting of ►  June (6)
minds was established.

METROPOLITAN MANILA DEVELOPMENT AUTHORITY VS. JANCOM

ENVIRONMENTAL CORPORATION
GR No. 147465, January 30, 2002

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Facts:
A Build-Operate-Transfer Contract for the waste to energy project was
signed between JANCOM and the Philippine Government. The BOT Contract was
submitted to President Ramos for approval but was then too close to the end of his
term that his term expired without him signing the contract. He, however,
endorsed the same to incoming President Estrada. With the change in
administration came changes in policy and economic environment, thus the BOT
contract was not pursued and implemented. JANCOM appealed to the President
for reconsideration and despite the pendency of the appeal, MMDA caused the
publication of an invitation to pre-qualify and submit proposals for solid waste
management.

Issue:
Whether or not there is a valid and binding contract between the Republic
of the Philippines and JANCOM.

Held:
There is a valid and binding contract between JANCOM and the Republic of
the Philippines. Under Articles 1305 of the Civil Code, “A contract is a meeting of
the minds between two persons whereby one binds himself, with respect to the
other, to give something or to render some service.” Art. 1315 of the Civil Code
provides that a contract is perfected by mere consent. Consent, on the other hand,
is manifested by the meeting of the offer and the acceptance upon the thing and
the cause which are to constitute the contract. In the case at bar, the signing and
execution of the contract by the parties clearly show that, as between the parties,
there was a concurrence of offer and acceptance with respect to the material
details of the contract, thereby giving rise to the perfection of the absence of
President‛s signature is untenable. Significantly, the contract itself provides that
the signature of the President is necessary only for its effectivity, not its
perfection.
            There being a perfected contract, MMDA cannot revoke or renounce the
same without the consent of the other. From the moment of perfection, the
parties are bound not only to the fulfillment of what has been expressly stipulated
but also to all the consequences which, according to their nature, may be in keeping
with good faith, usage and law. It is a general principle of law that no one may be
permitted to change his mind and go back upon his own acts, or to proceed
contrary thereto, to the prejudice of the other party.
 

ANAMA VS. COURT OF APPEALS

GR. No. 128609, January 29, 2004

Facts:
The property was previously owned by Douglas Anama‛s parents, who
mortgaged it to Philippine Savings Bank and later was foreclosed. Douglas and the
PSBank entered into an agreement denominated as a Contract to Buy whereby the
bank agreed to sell to Douglas the said land with all the improvements thereon. The
Contract to Buy provides that Anama shall purchase the property of a certain
amount and shall pay to the PSBank; it also provides that Anama shall apply with
the bank for a loan, the proceeds of which answer for the balance of the purchase
price; should the petitioner fail to comply with any of the terms of contract, all
amounts paid are forfeited in favor of PSBank, the latter having the option either
to demand full payment of total price or to rescind the contract.
Anama was able to pay the first and second installments; however, he failed to pay
the third installment when it became due. There were several transactions
between them to settle the amount due. But later, the bank executed an Affidavit
of Cancellation rescinding the contract, and forfeited the payments made by
Anama which were applied as rentals of the use of the property. Anama was then

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advised to vacate the property despite his opposition to the rescission of the
Contract to Buy. The bank sold the property to spouses Co, in whose favor TCT was
issued. Anama then filed a case for Declaration of Nullity of Deed of Sale,
Cancellation of TCT, and Specific Performance with Damages.

Issue:
Whether the rescission of the Contract to Buy was valid.

Held:
Since Anama failed to pay the third installment, PSBank was entitled to
rescind the Contract to Buy. The contract provides the Bank two options in the
event that petitioner fails to pay any of the installments. This was either (1) to
rescind the contract outright and forfeit all amounts paid by the petitioner, or (2)
to demand the satisfaction of the contract and insist on the full payment of the
total price. After petitioner repeatedly failed to pay the third installment, the
Bank chose to exercise the first option.
                      The Contract to Buy is actually a contract to sell whereby the vendor
reserves ownership of the property and is not to pass until full payment. Such
payment is a positive suspensive condition, the failure of which is not a breach but
simply an event that prevents the obligation of the vendor to convey title from
acquiring binding force. Since ownership of the subject property was not pass to
petitioner until full payment of the purchase price, his failure to pay on the date
stipulated, or in the extension granted, prevented the obligation for the Bank to
pass title of the property to Anama. The bank could validly sell the property to the
spouses Co, the right of the bank to sell the property being unequivocal.
 

HILADO VS. HEIRS OF RAFAEL MEDALLA

G.R. No. 144227, February 15, 2002

Facts:
Gorgonio Macainan was the owner of the several properties. After his
death, his estate was divided among his heirs, including his children by his first
wife, a contract (Anita, Rosita & Berbonio) As Berbonio had predeceased Gorgonio,
her children ( Rafael, Lourdes&Teresita surnamed Medalla) succeeded to her
inheritance. Respondents herein are the heirs of Rafael Medalla.
Rafael Medalla executed a Deed of Absolute Sale purporting to sell his
share in the inheritance to Gorgonio Hilado. Later, he executed another”Deed of
Absolute Sale in favor of Hilado over his share in another inherited property. Over
the next 2 years, Hilado and Medalla executed 3 more contracts concerning the
sold properties;” “ Memorandum of Agreement,”“Deed of Resale,” whereby Hilado
resold to Medalla two of the 5 hectares a lot, and ”Agreement.”
Anita Macainan tried to redeem the first property that was sold from
Hilado but she failed, so she filed a suit against Rafael and Hilado for legal
redemption before the RTC. So, Rafael filed a cross-claim against Hilado, alleging
that the first deed of sale was in fact an equitable mortgage to secure a loan from
Hilado. The latter denied that the agreement between them was a loan but a Deed
of Sale, reflecting their true agreement.

Issue:
Whether the Deed of Absolute Sale executed by Medalla and Hilado is in
fact an equitable mortgage.

Held:
Under Art. 1602 in relation to Art. 1604, a contract purporting to be an
absolute sale is presumed to be an equitable mortgage (1) when the price of a sale
with a right to reprchase is unusually inadequate; (2) when the vendor remains in
possession as lessee or otherwise;(3) when upon or after the expiration of the
right to repurchase another instrument extending the period of the redemption or

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granting a new period is executed;(4) when the purchaser retains for himself a
part of the purchase price;(5) when the vendor binds himself to pay the taxes on
the thing sold;(6) in any other case where it may be fairly inferred that the real
intention of the parties is that the presence of any of these circumstances is
sufficient for a contract to be presumed as an equitable mortgage.
            In view of the conclusions we have reached, it is unnecessary to pass upon
Hilado‛s contention that respondents are bound by the terms of the “Deed of Sale”
in question as the law between the parties. It will suffice to say that even if a
document appears on its face to be a sale, the owner of the property may prove
that the contract is really a loan with a mortgage that the document does not
express the true intent and agreement of the parties.
 
 

KATIPUNAN VS. KATIPUNAN, JR.

G.R. No. 132415, January 30, 2002

Facts:
Respondent Braulio Katipunan Jr. is the registered owner of a lot and a five-
door apartment constructed thereon, which were occupied by lessees. Respondent
assisted by his brother petitioner Miguel entered into a Deed of Absolute Sale
with brothers Edardo Balguma and Leopoldo Balguma, Jr. ( co-petitioners),
represented by their lawyer-father involving the subject property for a
consideration of P187,000.00. So, the title was registered in the names of the
Balguma brothers and they started collecting rentals thereon.
                      Later, Braulio filed a complaint for annulment of the Deed of Absolute
Sale, contending that his brother Miguel, Atty. Balguma and Inocencio Valdez ( one
of the petitioners) convinced him to work abroad. Through insidious words and
machinations, they made him sign a document purportedly a contract of
employment, which document turned out to be a Deed of Absolute Sale. He further
alleged that he did not receive the consideration stated in the contract. He
claimed that there was evident bad faith and conspiracy in taking advantage of his
ignorance, he being only a third grader.
            The RTC dismissed the complaint because Braulio failed to prove his cause
of action since he admitted that he obtained loans from the Balgumas, he signed
the Deed of Absolute Sale, and he acknowledged selling the property and stopped
collecting the rentals. But when the case was elevated, the decision of RTC was
reversed and it was held that Braulio was incompetent, has very low I.Q., illiterate
and has a slow comprehension. The CA based its decision on Arts.1332 and 1390 of
NCC and Sec. 2, Rule 92 of the Rules of Court, concerning the incompetence of a
party in contract.

Issue:
Whether there was a valid contract of sale between the parties.

Held:
The Supreme Court found the petition devoid of merit. There was a vitiated
consent on the part of the respondent as he signed the Deed of Absolute Sale
without the remotest idea of what it was and received no consideration thereof.
The contract entered into by the parties being voidable contract, was correctly
annulled on appeal.
            A contract of sale is born from the moment there is a meeting of minds
upon the thing which is the object of the contract and upon the price. This meeting
of minds speaks of the intent of the parties in entering the contract respecting
the subject matter and the consideration thereof. Thus, the elements of a
contract of a sale are consent, object, and price in money or its equivalent. Under
Art. 1330 of NCC, consent may be vitiated by any of the following: mistake,
violence, intimidation, undue influence, and fraud. The presence of any of these
vices renders the contract voidable.

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A contract where one of the parties is incapable of giving consent or where
consent is vitiated by mistake, fraud, or intimidation is not void ab initio but only
voidable and is binding upon the parties unless annulled proper court action. The
effect of annulment is to restore the parties to the status quo ante insofar as
legally and equitably possible---this much is dictated by Art. 1398 provides that
when the defect of the contract consists in the incapacity of one of the parties,
the incapacitated person is not obliged to make any restitution, except when he
has been benefited by the things or price received by him.              Thus, since the
Deed of Absolute Sale between respondent and Balguma brothers is voidable and
hereby annulled, then the restitution of the property and its fruits to respondent
is just and proper.

Posted by rsb at 4:13 PM 

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