CASE DIGEST: Alfonso Quijada vs CA, Regalado Mondejar G.R.

No. 126444. December 4, 1998(299 SCRA 695) (Yellow Pad

Digest)
Alfonso Quijada vs CA, Regalado Mondejar (299 SCRA 695)

Facts:
Petitioners are heirs of the late Trinidad Quijada. Trinidad inherited a 2 hectare land. April 5,1956,
Trininad along with her siblings, executed a DEED OF DONATION in favor of the Municipality of
Talacogon, with condition that the land shall be used exclusively as part of the campus of
the PROPOSED Provincial High School in Talacogon.
Despite the donation, Trininad still has possession of the land and sold 1 hectare to Regalado.
Subsequently, Trinidad sold the remaining 1 hectare to Regalado but this time verbally, no Deed of
Sale but it evidenced by receipts of payment.
Regalado sold portions of the land to respondents.
The Municipality was not able to finish the school thus returning the ownership of the property to the
donors.
July 5,1988. Petitioners (heirs) filed against the respondents stating that their late mother did sell the
property. If it was true that she (Trinidad) sold the property, it would be null and void since it was
already donated to the Municipality thus the ownership is with the Municipality.
RTC ruled in favor of the heirs, ruling that Trinidad had no capacity to sell because the ownership of the
land was already with the Municipality. CA reversed.

Issue: W/ON the sale is valid

Held: Yes. When the property was donated to the Municipality, the ownership was transferred to them
but wait theres more, there was a condition. A RESOLUTORY CONDITION, tho it was not stated in the
condition on how long the condition was, it was evident that the Municipality had intended to build the
school. Again, tho not stated how long, the Municipality still gave back the property to the donors thus
the ownership was transferred. Making the sale valid since ownership was returned.

Arturo R. Abalos Vs. Dr. Galicano S. Macatangay, Jr. (G.R. No. 155043. September 30, 2004)

439 SCRA 649 Civil Law Law on Sales Option Earnest Money
Arturo and Esther Abalos were husband and wife. They own a parcel of land in Makati. On
June 2, 1988, Arturo, armed with a purported Special Power of Attorney, executed a Receipt
and Memorandum of Agreement in favor of Galicano Macatangay, Jr. in which Arturo
acknowledged he received a P5k check from Galicano as earnest money to be deducted from
the purchase price and that Arturo binds himself to sell the land to Galicano within 30 days
from receipt of the P5k. The purchase price agreed upon was P1.3 M. However, the P5k
check was dishonored due to insufficiency.
Apparently however, Esther and Arturo were having a rocky relationship. Esther executed a
SPA in favor of her sister and that she is selling her share in the conjugal property to Galicano.
It was alleged that that the RMOA is not valid for Esthers signature was not affixed thereto.
And that Esther never executed a SPA in favor of Arturo. Galicano informed the couple that
he has prepared a check to cover the remainder of the amount that needs to be paid for the
land. He demanded that the land be delivered to him. But the spouses failed to deliver the
land. Galicano sued the spouses.
ISSUE: Whether or not there was a contract of sale between Arturo and Galicano. Whether
or not the subsequent agreement between Galicano and Esther is binding and that it cured
the defect of the earlier contract between Arturo and Galicano.
HELD: No. No matter how the RMOA is looked upon, the same cannot be valid. At best, the
agreement between Arturo and Galicano is a mere grant of privilege to purchase to Galicano.
The promise to sell is not binding to Arturo for there was actually no consideration distinct
from the price. Be it noted that the parties considered the P5k as an earnest money to be
deducted from the purchase price.
Assuming arguendo that it was a bilateral promise to buy and sell, the same is still not binding
for Galicano failed to render a payment of legal tender. A check is not a legal tender.
Still assuming arguendo, that the P5k was an earnest money which supposedly perfected a
contract of sale, the RMOA is still not valid for Esthers signature was not affixed. The property
is conjugal and under the Family Code, the spouses consents are required. Further, the
earnest money here is not actually the earnest money contemplated under Article 1482 under
the Civil Code.
The subsequent agreement between Esther and Galicano did not ratify the earlier transaction
between Arturo and Galicano. A void contract can never be ratified.

Beaumont v. Prieto
41 Phil 670
Araullo, J:

Facts: Benito Legarda owns a parcel of land known as the Nagtajan Hacienda which he wanted to sell
through his agent Benito Valdez; who is also his attorney in fact. Negotiations as to the purchase of land
has been had between Benito Valdez and W. Borck. However, the parties eventually had a
misunderstanding as to the three (3) month period which the agent Benito Valdez gave to Borck. It is an
option period to buy the property.

Issue: Whether the agreement between the parties constitutes a mere offer to sell or an actual contract of
option?

Held: There was not contract because there was no concurrence of the offer and acceptance of the thing and
the cause which are to constitute a contract. An option is an accepted offer. It states the terms and conditions
on which the owner is willing to sell or lease his land, if the holder elects to accept them within the time
limited. As there can be no contract without the concurrence of the requisites of consent of the parties and
cause of consideration of the obligation created, in order that a proposition or offer for sale may acquire the
character of a contract it is necessary that there appear the expression of the will of the offeror and that of
the offeree and the consent of both as well as the fact that there was a cause or consideration for the
obligation which is the object of what was agreed upon. Promises being binding when and so long as they
are accepted in the exact terms in which they are made it not being legally proper to modify the conditions
imposed by the promisor without his consent then in order that the acceptance of a proposition or offer
may be efficacious and the option be perfect and binding upon the parties thereto, itis necessary that such
acceptance should be unequivocal and unconditional and the acceptance and proposition shall be without
any variation whatsoever, so that whatever modifications or deviation from the terms of the offer annuls
the latter and frees the offeror.

BIGNAY EX-IM PHILIPPINES, INC., Petitioner,

vs.
UNION BANK OF THE PHILIPPINES, Respondent.
G.R. No. 171590 February 12, 2014

PONENTE: Del Castillo, J.

TOPIC: Negligence

FACTS:

In 1988, Rosario filed against Alfonso and Union Bank, Civil Case No. Q-52702
for annulment of the 1984 mortgage, claiming that Alfonso mortgaged the property
without her consent, and for reconveyance.

In a September 6, 1989 Letter-Proposal, Bignay Ex-Im Philippines, Inc. (Bignay),

through its President, Milagros Ong Siy (Siy), offered to purchase the property.

On December 20, 1989, a Deed of Absolute Sale6 was executed by and between
Union Bank and Bignay whereby the property was conveyed to Bignay for P4 million. The
deed of sale was executed by the parties through Bignays Siy and Union Banks Senior
Vice President Anthony Robles (Robles). One of the terms of the deed of sale is quoted
below:

Section 1. The VENDEE hereby recognizes that the Parcel/s of Land with
improvements thereon is acquired through foreclosure proceedings and agrees to buy the
Parcel/s of Land with improvements thereon in its present state and condition. The
VENDOR therefore does not make any x x x representations or warranty with respect to
the Parcel/s of Land but that it will defend its title to the Parcel/s of Land with
improvements thereon against the claims of any person whomsoever.

On December 12, 1991, a Decision8was rendered in Civil Case No. Q-52702 in

favor of Alfonso. Union Bank appealed the above Decision with the CA. It likewise sought
a new trial of the case, which the trial court denied. The CA appeal was dismissed for
failure to file appellants brief; the ensuing Petition for Review with this Court was
similarly denied for late filing and payment of legal fees.

Union Bank next filed with the CA an action to annul the trial courts December
12, 1991 judgment. In a September 9, 1993 Resolution, however, the CA again dismissed
the Petition for failure to comply with Supreme Court Circular No. 28-91. The banks
Motion for Reconsideration was once more denied.

This time, Bignay filed a Petition for annulment of the December 12, 1991
Decision, docketed as CA-G.R. SP No. 33901. In a July 15, 1994 Decision, the CA
dismissed the Petition. Bignays resultant Petition for Certiorari with this Court suffered
the same fate.

Meanwhile, as a result of the December 12, 1991 Decision in Civil Case No. Q-
52702, Bignay was evicted from the property; by then, it had demolished the existing
structure on the lot and begun construction of a new building.

ISSUE:

Whether or not Union Bank was grossly negligent in this case.

HELD:

YES. The Court held that the gross negligence of the seller in defending its title
to the property subject matter of the sale thereby contravening the express undertaking
under the deed of sale to protect its title against the claims of third persons resulting in
the buyers eviction from the property, amounts to bad faith, and the buyer is entitled to
the remedies afforded under Article 1555 of the Civil Code.

The record reveals that Union Bank was grossly negligent in the handling and
prosecution of Civil Case No. Q-52702. Its appeal of the December 12, 1991 Decision in
said case was dismissed by the CA for failure to file the required appellants brief. Next,
the ensuing Petition for Review on Certiorari filed with this Court was likewise denied due
to late filing and payment of legal fees. Finally, the bank sought the annulment of the
December 12, 1991 judgment, yet again, the CA dismissed the petition for its failure to
comply with Supreme Court Circular No. 28-91. As a result, the December 12, 1991
Decision became final and executory, and Bignay was evicted from the property. Such
negligence in the handling of the case is far from coincidental; it is decidedly glaring, and
amounts to bad faith. Negligence may be occasionally so gross as to amount to malice
[or bad faith]. Indeed, in culpa contractual or breach of contract, gross negligence of a
party amounting to bad faith is a ground for the recovery of damages by the injured party.

Facts:
Respondent Jose Poncio was the owner of the parcel of land located in Rizal.
(Area more or less 195 sq. m.)
The said lot was subject to mortgage in favor of the Republic Savings Bank for the
sum of P1,500.00.
Carbonell and respondent Emma Infante offered to buy the said lot from Poncio.
 Poncio offered to sell his lot to Carbonell excluding the house on which he and his
family stayed. Carbonell accepted the offer and proposed the price of P9.50/sq.
m..
Poncio accepted the price on the condition that from the purchase price would
come the money to be paid to the bank.
January 27, 1995: The parties executed a document in the Batanes dialect which is
translated as: CONTRACT FOR ONE HALF LOT WHICH I (Poncio) BOUGHT
FROM.
Carbonell asked a lawyer to prepare the deed of sale and delivered the document,
together with the balance of P400, to Jose Poncio. (Note: Carbonell already paid
P200 for the mortgage debt of Poncio + obligated herself to pay the remaining
installments.)
However, when she went to Poncio, the latter informed her that he could no longer
proceed with the sale as the lot was already sold to Emma Infante and that he
could not withdraw with the sale.
Poncio admitted that on January 30, 1995, Mrs. Infante improved her offer and he
agreed to sell the land and its improvements to her for P3,535.00.
In a private memorandum agreement, Poncio bound to sell to Infante the lot for the
sum of P2,357.52, with Infante still assuming the mortgage debt of P1,177.48.
(Note: The full amount of mortgage debt was already paid by the Infantes)
February 2, 1995: A deed of sale was executed between Poncio and Infante.
February 8, 1995: Knowing that the sale to Infante has not been registered,
Carbonell filed an adverse claim.
February 12, 1995: The deed of sale was registered but it has an annotation of the
adverse claim of Carbonell.
Thereafter, Emma Infante took possession of the lot, built a house and introduced
some improvements.
In June 1995, Carbonell filed a complaint praying that she be declared the lawful
owner of the land, that the subsequent sale to spouses Infante be declared null
and void, and that Jose Poncio be ordered to execute the corresponding deed of
conveyance of said land in her favor
RTC ruled that the sale to spouses Infante was null and void. After re-trial, it
reversed its ruling. CA ruled in favor of Carbonell but after a MfR, it reversed its
ruling and ruled in favor of the Infantes.

Issue: WON Carbonell has a superior right over Emma Infante. YES

Held:

Article 1544 provides that for double sale of an immovable property, the ownership
shall belong to the person who first acquired it in good faith and recorded it in the
Registry of Property
Article 1544, New Civil Code, which is decisive of this case, recites:
If the same thing should have been sold to different vendees, the ownership shall be
transferred to the person who may have first taken possession thereof in good faith, if it
should movable property.
Should it be immovable property, the ownership shall belong to the person acquiring it
who in good faith first recorded it in the Registry of Property.
Should there be no inscription, the ownership shall pertain to the person who in good faith
was first in the possession; and, in the absence thereof, to the person who presents the
oldest title, provided there is good faith.

The buyer must act in good faith in registering the deed of sale
It is essential that the buyer of realty must act in good faith in registering his deed of sale
to merit the protection of the second paragraph of said Article 1544.

Unlike the first and third paragraphs of said Article 1544, which accord preference to the
one who first takes possession in good faith of personal or real property, the second
paragraph directs that ownership of immovable property should be recognized in favor of
one "who in good faith first recorded" his right. Under the first and third paragraph, good
faith must characterize the act of anterior registration.

Rule when there is inscription or not

If there is no inscription, what is decisive is prior possession in good faith. If there is
inscription, as in the case at bar, prior registration in good faith is a pre-condition to
superior title.

Carbonell was in good faith when she bought the lot

When Carbonell bought the lot from Poncio on January 27, 1955, she was the only buyer
thereof and the title of Poncio was still in his name solely encumbered by bank mortgage
duly annotated thereon. Carbonell was not aware and she could not have been aware
of any sale of Infante as there was no such sale to Infante then.

Hence, Carbonell's prior purchase of the land was made in good faith. Her good faith
subsisted and continued to exist when she recorded her adverse claim four (4) days prior
to the registration of Infantes's deed of sale.

Carbonells good faith did not cease when she was informed by Poncio about the
sale to Emma Infante
After learning about the second sale, Carbonell tried to talk to the Infantes but the latter
refused.
(Exact words of the SC: With an aristocratic disdain unworthy of the good breeding of a
good Christian and good neighbor, Infante snubbed Carbonell like a leper and refused to
see her.)

So Carbonell did the next best thing to protect her right she registered her adversed
claim on February 8, 1955. Under the circumstances, this recording of her adverse claim
should be deemed to have been done in good faith and should emphasize Infante's bad
faith when she registered her deed of sale four (4) days later on February 12, 1955.
The Infantes were in bad faith (5 indications of bad faith listed below)
Bad faith arising from previous knowledge by Infante of the prior sale to Carbonell is
shown by the following facts:
1. Mrs. Infante refused to see Carbonell.
Her refusal to talk to Carbonell could only mean that she did not want to listen to
Carbonell's story that she (Carbonell) had previously bought the lot from Poncio.
2. Carbonell was already in possession of mortgage passbook and copy of the mortgage
contract. (Not Poncios saving deposit passbook.)
Infante naturally must have demanded from Poncio the delivery to her of his mortgage
passbook and mortgage contract so that the fact of full payment of his bank mortgage will
be entered therein; and Poncio, as well as the bank, must have inevitably informed her
that said mortgage passbook could not be given to her because it was already delivered
to Carbonell.
3. Emma Infante did not inquire why Poncio was no longer in possession of the mortgage
passbook and why it was in Carbonells possession.
The fact that Poncio was no longer in possession of his mortgage passbook and that the
said mortgage passbook was already in possession of Carbonell, should have compelled
Infante to inquire from Poncio why he was no longer in possession of the mortgage
passbook and from Carbonell why she was in possession of the same.
4. Emma Infante registered the sale under her name after Carbonell filed an adverse
claim 4 days earlier.
Here she was again on notice of the prior sale to Carbonell. Such registration of adverse
claim is valid and effective.
5. Infante failed to inquire to Poncio WON he had already sold the property to Carbonell
especially that it can be shown that he was aware of the offer made by Carbonell.
Poncio alleged in his answer that Mrs. Infante and Mrs. Carbonell offered to buy the lot
at P15/sq. m. which offers he rejected as he believed that his lot is worth at least
P20.00/sq. m. It is therefore logical to presume that Infante was told by Poncio and
consequently knew of the offer of Carbonell which fact likewise should have put her on
her guard and should have compelled her to inquire from Poncio whether or not he had
already sold the property to Carbonell

The existence of prior sale to Carbonell was duly established

From the terms of the memorandum, it tends to show that the sale of the property in favor
of Carbonell is already an accomplished act. As found by the trial court, to repeat the
said memorandum states "that Poncio is allowed to stay in the property which he had sold
to the plaintiff ..., it tends to show that the sale of the property in favor of the plaintiff is
already an accomplished act..."

There was an adequate consideration or price for the sale in favor of Carbonell
Poncio agreed to sell the same to Carbonell at P9.50 per square meter, on condition that
Carbonell:
1. should pay (a) the amount of P400.00 to Poncio and the arrears in the amount of
P247.26 to the bank
2. should assume his mortgage indebtedness.
The bank president agreed to the said sale with assumption of mortgage in favor of
Carbonell an Carbonell accordingly paid the arrears of P247.26.

It is evident therefore that there was ample consideration, and not merely the sum of
P200.00, for the sale of Poncio to Carbonell of the lot in question.

The subject property was identified and described

The court has arrived at the conclusion that there is sufficient description of the lot referred
to in Exh. As none other than the parcel of lot occupied by the defendant Poncio and
where he has his improvements erected. The Identity of the parcel of land involved herein
is sufficiently established by the contents of the note Exh. 'A'.

G.R. No. 141480 November 29, 2006CARLOS B. DE GUZMAN,

Petitioner,vs. TOYOTA CUBAO, INC., Respondent.
On November 27, 1997, petitioner purchased from respondent a brand new white Toyota Hi-Lux.
The vehicle was delivered to petitioner two days later. On October 18, 1998, Mr. de Guzman
demanded for the replacement of the engine of the vehicle because it showed a crack during a trip
that passes Marcos Highway during a heavy rain. Mr. De Guzman demanded for the Toyota dealer
to replace the engine with a new one based on an implied warranty.

On the other hand, Toyota Cubao maintains that Mr De Guzman's claim for replacement was
already barred by the statute of limitations amd had therefore prescribed under Article 1571 of the
Civil Code for claiming cause of action for more than six months from the time the vehicle was
purchased and/or delivered. Respondent reiterates that Article 169 of Republic Act No. 7394 does
not apply.

SUPREME COURT HELD:

Under Article 1599 of the Civil Code, once an express warranty is breached, the buyer can accept or
keep the goods and maintain an action against the seller for damages. In the absence of an existing
express warranty on the part of the respondent, as in this case, the allegations in petitioners
complaint for damages were clearly anchored on the enforcement of an implied warranty against
hidden defects, in which in this case, that the engine of the vehicle which Toyota had sold to Mr. de
Guzman was not defective.

By filing this case, Mr. de Guzman wants to hold Toyota responsible for breach of implied warranty
for having sold a vehicle with defective engine. Such being the case, petitioner should have exercised
this right within six months from the delivery of the thing sold. Since petitioner filed the complaint
on April 20, 1999, or more than nineteen months counted from November 29, 1997 (the date of the
delivery of the motor vehicle), his cause of action had prescribed.
 [ G.R. No. 131679, February 01, 2000 ]

CAVITE DEVELOPMENT BANK AND FAR EAST BANK AND TRUST COMPANY, PETITIONERS, VS. SPOUSES CYRUS LIM
AND LOLITA CHAN LIM AND COURT OF APPEALS, RESPONDENTS.

Facts:
Rodolfo Guansing obtained a loan from Cavite Development Bank(CDB) and offered as
security his real estate property. For failing to pay his loan the property was foreclosed and title
was issued in the name of CDB.
Now here comes Lolita Chan Lim, the respondent on this case who offered to buy the property
from CDB. Mrs. Lim paid P30,000.00 as option money and was issued receipt by CDB.
However , Mrs. Lim later discovered that the title of the property is being disputed by Perfecto
Guansing, the father of the mortgagee Rodolfo Guansing. In fact, in a separate case it was
declared that Rodolfo fraudulently secured title to the said mortgaged property and title to it was
restored to Perfecto . The decision has since become final and executory.
Aggrieved by what she considered a serious misrepresentation by CDB and its mother company
FEBTC, on their ability to sell the subject property, filed an action for specific performance and
damage against petitioners.
Issues: Was the sale between CDB and Mrs. Lim perfected?
Is CDB liable for damges?
Is the sale valid?
Decision: Contracts are not defined by the parties thereto but by the principles of law. In
determining the nature of a contract, the courts are not bound by the name or title given to it by
the contracting parties. In the case at bar, the sum of P30,000.00, although denominated in the
offer to purchase as option money is actually in the nature of earnest money or down payment
when considered with the other terms of the offer.
It is because when Mrs. Lim offered to buy the property the 10% so called option money forms
part of the purchase price as contemplated under Art. 1482 of the Civil Code. It is clear then that
the parties in this case actually entered into a contract of sale, partially consummated as to the
payment of the price.
CDB cannot invoke the defense that it is a mortgagee in good faith. It only applies to private
individuals and not to banking institutions. They cannot be excused from the duty of exercising
the due diligence required of banking institutions. It is standard practice for banks, before
approving a loan, to investigate who are the real owners thereof. Banking is affected with public
interest that is why they are expected to exercise more care and prudence than private
individuals.
Considering CDBs negligence it is therefore liable for damages.
As to its validity, the doctrine of Nemo dat quod non habet applies. One cannot give what one
does not have. The seller not being the owner the sale is void.