After contract expired w/o agreement for renewal, Buce became subject to ejectment.However, respondents didn’t include a prayer for the restoration of possession intheir complaint nor did they file an unlawful detainer suit. Ejectment was not an issueagreed upon by the parties, either since they limited the issue to the correctinterpretation of the contract. Nor was it raised on appeal. Thus, CA went beyond itsauthority in this aspect.
Petition partly granted. CA ruling w/c ordered Buce to vacate premises reversedw/o prejudice to filing of proper action.
ARANETA vs. PHILIPPINE SUGAR ESTATE DEVELOPMENT 
J. M. Tuason & Co., Inc., owner of the Sta. Mesa Heights Subd., sold a portionthereof through Gregorio Araneta, Inc. (GAI), for the sum of P430,514, to Phil. Sugar Estates Dev’t Co., Ltd (PSEDC).
There stipulated in their contract of purchase & sale w/ mortgage:
that the buyer will build on the parcel of land the Sto Domingo church &convent; while
the seller for its part will construct streets on the NE & NW & SW sides of theland herein sold so that the latter will be a block surrounded by streets on all 4sides; & the street on the NE side shall be named Sto. Domingo Ave.
PSEDC finished the construction of the church & convent, but GAI, w/c beganconstructing the streets, is unable to finish the construction of the street in the NEside because a certain third party who has been physically occupying a middle partthereof, refused to vacate the same
Hence, PSEDC filed its complaint against J. M. Tuason & Co., Inc., & GAI in theCFI, seeking to compel the latter to comply w/ their obligation &/or to pay damagesin the event they failed or refused to perform said obligation.
Both defendants answered the complaint. GAI’s principal defense was that theaction was premature since its obligation to construct the streets in question wasw/o a definite period w/c needs to be fixed 1st by the court in a proper suit for thatpurpose before a complaint for specific performance will prosper.
Issues having been joined in trial, CFI (May 31, ’60) dismissed plaintiff's complaint,upholding defenses interposed by GAI
Plaintiff moved to reconsider & modify above decision, praying that court fix periodw/in w/c defendants will comply w/ their obligat’n
GAI opposed said motion. But CFI granted plaintiff's MFR & amending thedispositive portion of the decision of May 31, ‘60, to read as follows: "WHEREFORE, judgment is hereby rendered giving defendant Gregorio Araneta, Inc., a period of Two (2) Years from notice hereof, within which to comply with its obligation under the contract, Annex A"
GAI filed MFR but CFI denied. GAI appealed to the CA, contending that the relief granted, i.e., fixing of a period, was not justified by the pleadings & not supported bythe facts submitted at the trial of the case in court below & that the relief granted ineffect allowed a change of theory after the submission of the case for decision
CA upheld the CFI decision. Hence this petition for review by certiorari to the SC
WON CFI may fix a period in the same pleading by PSEDC
NO. When GAI pleaded in its answer that the contract w/ PSEDC gave GAI"reasonable time w/in w/c to comply with its obligation to construct & complete thestreets", what the answer put in issue was not whether the court should fix the timeof performance, but WON the parties agreed that the petitioner should havereasonable time to perform its part of the bargain.
If the contract so provided, then there was a period fixed, a "reasonable time"; & allthat the court should have done was to determine if that reasonable time hadalready elapsed when suit was filed. If it had passed, then the court should declarethat petitioner had breached the contract, as averred in the complaint, & fix theresulting damages. On the other hand, if the reasonable time had not yet elapsed,the court perforce was bound to dismiss the action for being premature. But in nocase can it be logically held that under the plea above quoted, court intervention tofix the period for performance was warranted, for Art. 1197 is precisely predicated onthe absence of any period fixed by the parties
Granting that the court should’ve found that no reasonable time/no period at all hadbeen fixed, still the complaint not having sought that the Court should set a period,the court couldn’t proceed to do so unless the complaint was first amended; for theorig. decision is clear that the complaint proceeded on the theory that the period for performance had elapsed already, that the contract had been breached & defendantwas already answerable in damages.
Granting further that it lay within the Court's power to fix the period of performance,still the amended decision is defective in that no basis is stated to support theconclusion that the period should be set at 2 yrs after finality of the judgment. Art.1197 is clear that the period can not be set arbitrarily.
All that TC's amended decision says in this respect is that "the proven factsprecisely warrant the fixing of such a period", a statement manifestly insufficient toexplain how the 2 year period given to petitioner herein was arrived at.
Art. 1197, CC involves a 2-step process.
Court must 1st determine that "the obligation does not fix a period" (or that theperiod is made to depend upon the will of the debtor), "but from the nature & thecircumstances it can be inferred that a period was intended" (Art. 1197, pars.1&2)
Secondly, it must decide what period was "probably contemplated by theparties"
Ultimately, the Court can not fix a period merely because in its opinion it is or shouldbe reasonable, but must set the time that the parties are shown to have intended.
In this connection, contract shows that the parties were fully aware that the landdescribed therein was occupied by squatters, because the fact is expresslymentioned therein. As the parties must have known that they could not take the lawinto their own hands, but must resort to legal processes in evicting the squatters,they must have realized that the duration of the suits to be brought would not beunder their control nor could the same be determined in advance. The parties musthave thus intended to defer the performance of the obligations under the contractuntil the squatters were duly evicted, as contended by the GAI
CA objected that it would render the date of performance indefinite. Yet, thecircumstances admit no other reasonable view; & this very indefiniteness is whatexplains why the agreement did not specify any exact periods or dates of performance.
Reversed; Time for the performance is fixed at the date that all the squatters onaffected areas are finally evicted therefrom.
CPU vs. CA
Iloilo, in 1939, Don Ramon Lopez by a deed of donation donated Lot No. 3174-B-1 of the subdivision plan Psd-1144, then a portion of Lot No. 3174-B, for which Transfer Certificate of Title No. T-3910A to CPU.
The deed of donation came with 3 annotations on the land: