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which reverses the judgment of the Court of First Instance of Pampanga in favorof petitioners-appellants against the Secretary and Undersecretary of Public Works & Communicationsin the case instituted to annul the order directing the removal by the petitioners of the dikes they had constructedon Lot No. 15856 of the Register of Deeds of Pampanga; The spouses Romeo Martinez and Leonor Suarez, now petitioners-appellees, are the registered owners of two (2) parcels of land located in Lubao, Pampanga, covered by transfer certificate of title No.15856 of the Register of Deeds of the said province. Both parcels of land are fishponds. The property involved in the instant case is the second parcel mentioned in the above-named transfer certificate of title. The disputed property was originally owned by one Paulino Montemayor, who secured a "titulo real"over it way back in 1883. After the death of Paulino Montemayor the said property passed to hissuccessors-in-interest, Maria Montemayor and Donata Montemayor, who in turn, sold it, as well as thefirst parcel, to a certain Potenciano Garcia. chanroblesvirtualawlibrarychanrobles virtual lawlibrary Because Potenciano Garcia was prevented by the then municipal president of Lubao, Pedro Beltran,from restoring the dikes constructed on the contested property, the former, on June 22, 1914, filedCivil Case No. 1407 with the Court of First Instance against the said Pedro Beltran to restrain thelatter in his official capacity from molesting him in the possession of said second parcel, and on evendate, applied for a writ of preliminary injunction, which was issued against said municipal president.The Court, by decision promulgated June 12, 1916, declared permanent the preliminary injunction,which, decision, on appeal, was affirmed by the Supreme Court on August 21, 1918. From June 22,1914, the dikes around the property in question remained closed until a portion thereof was againopened just before the outbreak of the Pacific War. chanroblesvirtualawlibrarychanrobles virtual lawlibrary On April 17, 1925. Potenciano Garcia applied for the registration of both parcels of land in his name,and the Court of First Instance of Pampanga, sitting as land registration court, granted the registration over and against the opposition of the Attorney-General and the Director of Forestry. Pursuant to theCourt's decision, original certificate of title No. 14318, covering said parcels 1 and 2 was issued to thespouses Potenciano Garcia and Lorenza Sioson. chanroblesvirtualawlibrarychanrobles virtual law library These parcels of land were subsequently bought by Emilio Cruz de Dios in whose name transfercertificate of title No. 1421 was first issued on November 9, 1925. chanroblesvirtualawlibrarychanrobles virtual law library Thereafter, the ownership of these properties changed hands until eventually they were acquired bythe herein appellee spouses who hold them by virtue of transfer certificate of title No. 15856. chanroblesvirtualawlibrarychanrobles virtual law library To avoid any untoward incident, the disputants agreed to refer the matter to the Committee on Riversand Streams, by then composed of the Honorable Pedro Tuason, at that time Secretary of Justice, aschairman, and the Honorable Salvador Araneta and Vicente Orosa, Secretary of Agriculture andNational Resources and Secretary of Public Works and Communications, respectively, as members.This committee thereafter appointed a Sub-Committee to investigate the case and to conduct anocular inspection of the contested property, and on March 11, 1954, said Sub-Committee submitted itsreport to the Committee on Rivers and Streams to the effect that Parcel No. 2 of transfer certificate of title No. 15856 was not a public river but a private fishpond owned by the herein spouses.. Issue: WON THE COURT OF APPEALS ERRED IN ORDERING THE CANCELLATION OF THE REGISTRATION OF LOTNO. 2 OF TRANSFER CERTIFICATE OF TITLE NO. 15856 NOTWITHSTANDING THE FACT THAT THETORRENS TITLE COVERING IT HAS BEEN VESTED IN THE PETITIONERS WHO ARE THE SEVENTH OF THE SUCCESSIVE INNOCENT PURCHASERS THEREOF AND WHO IN PURCHASING THE SAME RELIEDON THE PRINCIPLE THAT THE PERSONS DEALING WITH REGISTERED LAND NEED NOT GO BEHINDTHE REGISTER TO DETERMINE THE CONDITION OF THE PROPERTY As regards the 3rd assignment of error, there is no weight in the appellants' argument that, being a purchaser for value and in good faith of Lot No. 2, the nullification of its registration would be contrary to the law and to the applicable decisions of the Supreme Court as it would destroy the stability of the title which is the core of the system of registration. Appellants cannot be deemed purchasers for value and in good faith because before purchasing a parcel of land, it cannot be contended that the appellants who were the vendees did not know exactly the condition of the land that they were buying and the obstacles or restrictions thereon that may be put up by the government in connection with their project of converting Lot No. 2 in question
by the State which is not bound by any prescriptive period provided for by the Statute of Limitations (Article 1108. G. L-23712. the jurisdiction of the Secretary of Public Works & Communications under Republic Act 2056 to order the removal or obstruction to navigation along public and navigable creek or river included therein. 3 parcels of residential land in Iloilo City (OCT 3462). became Lot 1214-D. par.called “Arellano Plan.788 sq. m. The University of the Philippines. was designated as Lot 1214-C.. among other properties. more or less..788 sq. because as alleged by Pio Sian Melliza. The Land Registration Court has no jurisdiction over non-registerable properties. 5 and 1214. The donation was however revoked by the parties for the reason that the area donated was found inadequate to meet the requirements of the development plan of the municipality. L-24732. G.into a fishpond. into Lots 1214-A and 1214-B. but may rely on the registry to determine if there is no lien or encumbrances over the same. FOR ALL THE FOREGOING.1968. 1214-C and 1214-D. Inc. April 29. Lot 1214-B-1. The right of reversion or reconveyance to the Stateof the public properties fraudulently registered and which are not capable of private appropriation orprivate acquisition does not prescribe. The site donated consisted of Lots 1214-B. thru his lawyer. the so. On 27 November 1931 she donated to the then Municipality of Iloilo. of Lot 1214 now designated as Lots 1412-B-2 and 1214-B-3 of the subdivision plan belongs to the Municipality of Iloilo as per instrument dated 15 November 1932.. they willfully and voluntarily assumed the risks attendant to the sale of said lot. No. 1968. of Lot 1214 (sublots 1214-B2 and 1214-B3) in favor of the Municipal Government of Iloilo for the sum of P6. therefore. Annotated at the back of Pio Sian Melliza‟s title certificate was the following “that a portion of 10. 7 SCRA 47.” On 14 January 1938. the judgment of the Court of First Instance of Pampanga as regards the Lot No. No recovery was obtained. has been definitely settled and is no longer open to question. m.R. clear that the authorities cited by the appellants as to the conclusiveness and incontestability of a Torrens certificate of title do not apply here. 1214-B. meanwhile. with 6. Lot 1214-B was further divided into Lots 1214-B-1. 2 of Certificate of Title No. Nos. Hence. Pio Sian Melliza thereupon made representations. the University of the Philippines enclosed the site donated with a wire fence. which succeeded to the Municipality of Iloilo. m.. After stipulation of facts and trial. to serve as site for the municipal hall. obtained Transfer Certificate of Title No.. the City did not have funds.562 sq. 2. On 19 May 1965. The total area of Lot 1214 was 29. and cannot validly adjudge the registration of title in favor of a private applicant. Lot 1214-B-2 and Lot 1214-B-3. and a portion of 10.” On 24 August 1949 the City of Iloilo.R. of Lot 2 (sublots 2-B and 2-C). 23 SCRA 348. (Republic v. Melliza sold her remaining interest in Lot 1214 to Remedios Sian Villanueva (thereafter TCT 18178). On 15 November 1932. m. with 4. the CA affirmed the interpretation of the CFI that the portion of Lot 1214 sold by . Lot 1214B-2. cannot be availed of as against the law and the accepted principle that rivers are parts of the public domain for public use and not capable of private appropriation or acquisition by prescription. January 31. Ramona Ruiz. the judgment of the Court of Appeals appealed from is in accordance withlaw.653 sq. Ramos. the CFI rendered its decision on 15 August 1957. these lots and portions being the ones needed by the municipal government for the construction of avenues. either directly or collaterally. new Civil Code). 15856 in the name of petitioners-appellants may be attacked at any time. Pio Sian Melliza appealed to the Court of Appeals.135 sq. m. No.422. Republic v.073 sq. it was held that the incontestable and indefeasible character of a Torrens certificate of title does not operate when the land covered thereby is not capable of registration. Lot 1214 was divided by Certeza Surveying Co. with 4. dismissing the complaint. and the same is hereby affirmed with costs against the petitioners-appellants.) When it comes to registered properties. Remedios in turn on 4 November 1946 transferred her rights to said portion of land to Pio Sian Melliza (thereafter TCT 2492). As approved by the Bureau of Lands. Sometime in 1952. One who buys something with knowledge of defect or lack of title in his vendor cannot claim that he acquired it in good faith. Said court ruled that the instrument executed by Juliana Melliza in favor of Iloilo municipality included in the conveyance Lot 1214-B. such as public navigable rivers which are parts of the public domain. with a total area of 15. April 30. and thus it held that Iloilo City had the right to donate Lot 1214-B to UP. 1963. Nevertheless. became known as Lot 1214-B.L-15484. and Lot 1214-B-3.350 sq. And still later. 4. of Lot 1214. et al.R. 9. to the University of the Philippines (Iloilo branch). parks and City hall site according the “Arellano plan. The ruling is that a purchaser of a registered property cannot go beyond the record to make inquiries as to the legality of the title of the registered owner. Said parcels of land were known as Lots Nos.” Subsequently. m. donated the city hall site together with the building thereon. m. No. On 10 December 1955 Pio Sian Melizza filed an action in the CFI Iloilo against Iloilo City and the University of the Philippines for recovery of Lot 1214-B or of its value. It is. Iloilo City [G. m. 7669 sq.] Facts: Juliana Melliza during her lifetime owned. Melliza v. with the city authorities for payment of the value of the lot (Lot 1214-B). 7152 covering the three lots.. m. Juliana Melliza executed an instrument without any caption providing for the absolute sale involving all of lot 5. 1214-C and 1214-D.000 sq.
3. 5. the Municipality of Iloilo possessed it together with the other lots sold. is fulfilled as long as. admittedly covered by the public instrument. the construction of the city hall site. The previous donation of land for city hall sit on 27 November 1931 was revoked on 6 March 1932 for being inadequate in area under said Arellano plan. It is therefore the more reasonable interpretation to view it as describing those other portions of land contiguous to the lots that. As such. The Supreme Court affirmed the decision appealed from insofar as it affirms that of the CFI. parks and for city hall site. Intent of the parties as to the object of the public instrument The paramount intention of the parties was to provide Iloilo municipality with lots sufficient or adequate in area for the construction of the Iloilo City hall site. and is in the heart of the city hall site Lot 1214-B is contiguous to Lots 1214-C and 1214-D. that sale must have a determinate thing as object. 4. he should have examined the Arellano plan in relation to the public instrument. will be found needed for the purpose at hand. parks and the city hall site. the object of the sale is capable of being made determinate without the necessity of a new or further agreement between the parties (Art. The specific mention of some of the lots plus the statement that the lots object of the sale are the ones needed for city hall site. Said next paragraph does not really add to the clear description that was already given to them in the previous one. but the lots object of the sale. and raised proper objections thereto if it was his position that the same was not included in the same. Hence. The area needed under that plan for city hall site was then already known. avenues and parks. since these lots were already plainly and very clearly described by their respective lot number and areas. that the specific mention of some of the lots covered by the sale in effect fixed the corresponding location of the city hall site under the plan. Lot 1214-B is contiguous to Lot 1214-C and 1214-D. Pio Sian Melliza a notary public and thus aware of the terms of the public instrument Pio Sian Melliza. Lot included in conveyance . For this matter. a previous donation for this purpose between the same parties was revoked by them. since the contract is in the nature of law as between the parties and their successors in interest. by stating that said lots were the ones needed for the construction of the city hall site. at the time the contract is entered into. 6. there would scarcely have been any need for the next paragraph. without costs. with its area.788 square meters specifically mentioned but included whatever was needed for the construction of avenues. and the projected city hall site. is fulfilled if object of sale is capable of being made determinate at the time of the contract The requirement of the law that a sale must have for its object a determinate thing. after execution of the contract. sufficiently provides a basis. From these stipulated facts. with its avenues and parks. Said instrument was also registered with the Register of Deeds and such registration was annotated at the back of the corresponding title certificate of Juliana Melliza. Nonetheless. 2. 5. as of the time of the execution of the contract. it can be inferred that Pio Sian Melliza knew of the aforesaid terms of the instrument or is chargeable with knowledge of them. were needed for the construction of the city hall site. 1. Art. according to the Arellano plan. considering the said lots specifically mentioned in the public instrument. 1273. that. that furthermore. therefore. estoppel and equity applied. New Civil Code). he should have taken notice of the possession first by the Municipality of Iloilo. 1460. as then shown in the Arellano plan (Exhibit 2). old Civil Code. not only those lots already mentioned. he was aware of its terms. for rendering determinate said lots without the need of a new and further agreement of the parties. If the parties intended merely to cover the specified lots (Lots 2. as well as laches. this appeal. avenues and parks according to the Arellano plan. then by the City of Iloilo and later by the University of the Philippines of Lot 1214-B as part of the city hall site conveyed under that public instrument. Arellano plan in existence since 1928. that knowing so. it could be determined which. It sits practically in the heart of the city hall site. It is stipulated that. 7. 1214-C and 1214-D). Said instrument described 4 parcels of land by their lot numbers and area. by reference to the Arellano plan. Interpretation of contract involves question of law The interpretation of the public instrument dated 15 November 1932 involves a question of law.Juliana Melliza was not limited to the 10. and then it goes on to further describe. was the notary public of the public instrument. it ordered the remand of the case for reception of evidence to determine the area actually taken by Iloilo City for the construction of avenues. because of inadequacy of the area of the lot donated. Area of land needed for the city hall site known The Arellano plan was in existence as early as 1928. Requirement. and how much of the portions of land contiguous to those specifically named. from the stipulation of facts. and dismissed the complaint. Principles of civil law.
a contract of lease of the land itself. said lot must necessarily be deemed included in the conveyance in favor of Iloilo municipality. A perusal of the deed fails to disclose any ambiguity or obscurity in its provisions. previous thereto. in violation of law. Applying. up to 1 January 1976. On 14 August 1968. to the State. In July 1972. Pichel v. Sua In Ras vs. and ordered Alonzo to pay back Pichel the consideration of the sale in the sum of P4. with costs against Pichel. No. On 5 January 1973. nor exercise any act of possession over Lot 1214-B. Instead. Within said period. Until and unless an appropriate proceeding for reversion is instituted by the State. hence the literal and plain meaning thereof should be observed. i. Basilan City in accordance with RA 477. January 30. however. the grantee cannot be said to have been divested of whatever right that he may have over the same property.00. the literal meaning of its stipulation shall control. estoppel. Court to apply the contract according to its express terms The first and fundamental duty of the courts is the application of the contract according to its express terms. interpretation being resorted to only when such literal application is impossible. Construction or interpretation of document not called for Construction or interpretation of the document in question is not called for. 1982. the document defines the object of the contract thus: “the herein sale of coconut fruits are for all the fruits on the aforementioned parcel of land during the years from 15 September 1968. there is nothing in the record to show that at any time after the supposed cancellation of the award on 27 January 1965.650. Pio Sian Melliza and his predecessors-in-interest. title. in consideration of P4.R.” In the present case. the lower court rendered its decision holding that although the agreement in question is denominated by the parties as a deed of sale of fruits of the coconut trees found in the vendor‟s land.200 with interests from the date of the filing of the complaint until paid. Pichel for the first time since the execution of the deed of sale in his favor. Such is the mandate of the Civil Code of the Philippines which provides that “if the terms of a contract ar e clear and leave no doubt upon the intention of the contracting parties. interest and participation herein conveyed is of his own exclusive and absolute property. Vendor grantee under RA 477.For 20 long years. in the sum of P3. from the cancellation of the award in 1965 to its reinstatement in 1972. Contract clear and unequivocal. it was categorically stated that a cancellation of an award granted pursuant to the provisions of RA 477 does not automatically divest the awardee of his rights to the land. Contract of sale valid. Even as of the date of sale. now Iloilo City. the “Deed of Sale” dated 14 August 1968 is precisely what it purports to be. for all legal intents and purposes.. In 1972. without costs. nor is there doubt as to the real intention of the contracting parties. In the present case. 3. The terms of the agreement are clear and unequivocal. Applying the doctrine announced in the Ras case.00. Article 1458 provides that “by the contract of sale one of the contracting parties obligates himself to transfer the ownership of and to deliver a determinate thing.00 as attorney‟s fees. essential elements valid The document in question expresses a valid contract of sale as it has the essential elements of a contract of sale as defined under Article 1458 of the New Civil Code. therefore. therefore. Sua. The Supreme Court set aside the judgment of the lower court and entered another dismissing the complaint. Hence. did not object to said possession.” 4. the petition to review on certiorari was raised before the Supreme Court. and the other to pay therefor a price certain in money or . It is a document evidencing the agreement of herein parties for the sale of coconut fruits of Lot 21. Alonzo and his wife sold to Pichel through a “deed of sale” all the fruits of the coconut trees which may be harvested in the land for the period.e.] First Division. Alonzo [G. and equity. Alonzo filed an action for the annulment of a “Deed of Sale” before the CFI Basilan City. reversion proceedings against Lot 21 were instituted by the State. Alonzo‟s rights to the land were reinstated. Lamitan. an encumbrance prohibited under RA 477. Alonzo is not deemed to have lost any of his rights as grantee of Lot 21 under RA 477 during the period material to the present case. 1. In clear and express terms. and not for the lease of the land itself. and could exercise all the rights pertaining thereto. and its reacquisition of the ownership and possession of the land decreed by a competent court. it actually is. Pending said payment Alonzo refused to allow the Pichel to make any harvest. The award was cancelled by the Board of Liquidators on 27 January 1965 on the ground that. as well as laches. Alonzo was proved to have alienated the land to another. from 15 September 1968 to 1 January 1976. principles of civil law. L-36902. caused the harvest of the fruit of the coconut trees in the land. Guerrero (J): 5 concur Facts: Prudencio Alonzo was awarded by the Government that parcel of land designated as Lot 21 of Subdivision Plan Psd-32465 of Balactasan. 2. the land was still under lease to one Ramon Sua.200. It was further stipulated that the vendor‟s right. following ruling in Ras v. Alonzo could exercise all the rights pertaining to a grantee with respect to Lot 21. free from any liens and encumbrances and he warrants to the Vendee good title thereto and to defend the same against any and all claims of all persons whomsoever. was to be paid by Pichel directly to Ramon Sua so as to release the land from the clutches of the latter. and it was the agreement that part of the consideration of the sale. The court thus held that the deed of sale is null and void. the admitted fact is that the award was reinstated in 1972. Such cancellation does not result in the immediate reversion of the property subject of the award. and Pichel to pay the sum of P500.
Borromeo. 1915..its equivalent.000 and the additional P1. St. 7. In the present case. and gains exclusive use thereof without the interference or intervention of the lessor. . 21 Am. 479. the sale of the nuts cannot be interpreted nor construed to be a lease of the trees. The Supreme Court affirmed the judgment appealed from with the modification allowing the recovery of P1.. the lower court‟s holding that the contract in question fits the definition of a lease of things wherein one of the parties binds himself to give to another the enjoyment or use of a thing for a price certain and for a period which may be definite or indefinite (Art. which though not yet actually in existence. the accessory follows the principal.] First Division. 9935. 50 Phil. is reasonably certain to come into existence as the natural increment or usual incident of something already in existence. The thing sold. In cannot be said that the possession and enjoyment of the coconut trees to be the possession and enjoyment of the land itself because the lessee in order to enjoy his right under the contract. 250. or fruits to grow. use. Yu Tek v.000. or the good will of a trade and the like.. enjoyment of property Article 1543 of the Civil Code defines the contract of lease as the giving or the concession of the enjoyment or use of a thing for a specified time and fixed price. or its representative may designate. A valid sale may be made of a thing. Things having potential existence may be the object of the contract of sale Under Article 1461 of the New Civil Code... while in lease no such transfer of ownership results as the rights of the lessee are limited to the use and enjoyment of the thing leased.200 by way of indemnity for loss and damages. without costs. 63). he actually takes possession of the land. Rep. filed a complaint against Gonzales. Thus. 165)” pp. where Gonzales was obligated to deliver 600 piculs of sugar of the 1st and 2nd grade to Yu Tek.” The subject matter of the contract of sale are the fruits of the coconut trees on the land during the years from 15 September 1968 up to 1 January 1976. 48 Conn. It is the other way around. it is evident that it must be regarded as one of the means of enjoyment referred to in said Article 398. 387. Packers Exchange. 40 Am. the contract will be rescinded and Gonzales shall be obligated to return the P3. Hull.000 received and also the sum of P1. pending crops which have potential existence may be the subject matter of sale (Sibal vs. much less extended further to include the lease of the land itself. or the wool that shall thereafter grow upon sheep. Rosa. which Yu Tek & Co. Contract of sale and lease of things distinguished The essential difference between a contract of sale and a lease of things is that the delivery of the thing sold transfers ownership. Transfer of accessory does not transfer principal The possession and enjoyment of the coconut trees cannot be said to be the possession and enjoyment of the land itself because these rights are distinct and separate from each other.000 only. and since such contract is a form of enjoyment of the property. Gonzales [G. Things of this nature are said to have a potential existence. 67 Me. 1 dissents Facts: A written contract was executed between Basilio Gonzalez and Yu Tek and Co. Rights determined by the writing itself Parties are presumed to have reduced to writing all the essential conditions of their contract. however. within the period of 3 months (1 January-31 March 1912) at any place within the municipality of Sta. 522-523). or the grain a fieldmay grow in a given time. Valdez. inasmuch as the terms enjoyment. Rodriguez vs. Judgment was rendered for P3. No. Yu Tek & Co. and benefit involve the same and analogous meaning relative to the general utility of which a given thing is capable. and prayed for judgment for the P3. February 1. Contract of lease. Cutting vs. or young animals not yet in existence. at least during harvest time. to the principal (the land). Rep. European Railway Co. and then belonging to the vendor. 6. and in case.. Civil Code of the Philippines) is erroneous. gathers all of the fruits of the coconut trees in the land. 512). A transfer of the accessory or improvement is not a transfer of the principal.R. under this contract nor had it been able to recover the P3. or what may be taken at the next case of a fisherman‟s net. (104 Jurisprudencia Civil. 443. or the milk a cow may yield during the coming year.200 under paragraph 4 of the contract. must be specific and identified. The rights of the parties must be determined by the writing itself. 490). which subject matter is a determinate thing. 43 Phil. the first pertaining to the accessory or improvements (coconut trees) while the second. things having a potential existence may be the object of the contract of sale. 8. No sugar had been delivered to Yu Tek & Co. and from this judgment both parties appealed.” and that “a contract of sale may be absolute or conditional. 5. They must be also owned at the time by the vendor (Hull vs. Trent (J): 4 concur. A man may sell property of which he is potentially and not actually possessed. Gonnzales does not deliver. 1643. In the present case. 1. and the title will vest in the buyer the moment the thing comes into existence (Emerson vs. He may make a valid sale of the wine that a vineyard is expected to produce.200.
” There is a perfected sale with regard to the “thing” whenever the article of sale has been physically segregated from all other articles. If called upon to designate the article sold. In the McCullough case. 47 Sou.” He could only use this generic name for the thing sold. Seegars & Co. although the delivery of the price was withheld until the necessary documents of ownership were prepared by the vendee. American jurisprudence. in the Barretto case. Franco (5 Phil.. after the contract has been perfected. The defendant drew a bill of exchange in the sum of P800.” Article 1452 provides that “the injury to or the profit of the thing sold shall. (3 Phil 285). 1096. Contract in present case merely an executory agreement: a promise of sale and not a sale The contract in the present case was merely an executory agreement. in said case.. the defendant suspended payment of the bill. It is our purpose to distinguish the case at bar from all these cases. where a quantity of hemp was the subject of the contract.2. (122 La. Perfected sale. There was no “appropriation” of any particular lot of sugar. Present case different from cases cited with perfected contracts The contract in the present case is different from the contracts discussed in the cases referred to. representing the price which had been agreed upon for the hemp thus delivered. notwithstanding that he owned a plantation himself. be governed by the provisions of articles 1096 and 1182. The contract placed no restriction upon him in the matter of obtaining the sugar. Neither party could point to any specific quantity of sugar. Go Inqui (8 Phil. and 1182 are not applicable. The contract contained no such condition and the court declined to receive parol evidence thereof. Rep. the particular shares of stock which the parties desired to transfer were capable of designation. a promise of sale and not a sale. Eastern Mining Co. 49) a sale of a specific house was held perfected between the vendor and vendee. a contract was entered into by a traveling salesman for a quantity of shoes. Gonzales undertook to deliver a specified quantity of sugar within a specified time. if they have agreed upon the thing which is the object of the contract and upon the price. 145. Parol evidence not admissible as it should not serve to incorporate additional conditions into a contract While parol evidence is admissible in a variety of ways to explain the meaning of written contracts. the hemp was destroyed. even when neither has been delivered. 8. It was held that the hemp having been already delivered. the customary unit of weight being denominated a „‟picul. a particular tobacco factory with its contents was held sold under a contract which did not provide for either delivery of the price or of the thing until a future time. 5. As there was no perfected sale. Cases where parol evidence was denied by the Court In Pastor v. Perfected contract of sale defined. part of which had .‟‟ There was no delivery under the contract. Gonzales alleged that the court erred in refusing to permit parol evidence showing that the parties intended that the sugar was to be secured from the crop which the defendant raised on his plantation. Whereupon. Executory contracts In Witt Shoe Co. and thus set apart and distinguished from all other hemp. Relief for non-delivery Article 1450 defines a perfected sale as follows: “The sale shall be perfected between vendor and vendee and shall be binding on both of them. 7. it is clear that articles 1452. the title had passed and the loss was the vendee‟s. 4. 444). as he was at liberty to purchase it on the market or raise it himself. For the purpose of sale its bulk is weighed. In Tan Leonco vs. In the present case. In the contract. In Barretto vs. it cannot serve the purpose of incorporating into the contract additional contemporaneous conditions which are not mentioned at all in the writing. the tobacco factory which the parties dealt with was specifically pointed out and distinguished from all other tobacco factories. In Eveland vs. Gaspar (2 Phil 592) the Court declined to allow parol evidence showing that a party to a written contract was to become a partner in a firm instead of a creditor of the firm. unless there has been fraud or mistake. specified shares of stock in a tobacco factory were held sold by a contract which deferred delivery of both the price and the stock until the latter had been appraised by an inventory of the entire assets of the company. Prior to the presentation of the bill for payment. Cases In McCullough vs. the sales having been made by sample. it is clear that Gonzales could only say that it was “sugar. for instance. The case appears to be one to which the rule which excludes parol evidence to add to or vary the terms of a written contract is decidedly applicable. Rep. vs. (14 Phil 509) a contract of employment provided that the plaintiff should receive from the defendant a stipulated salary and expenses The defendant in said case sought to interpose as a defense to recovery that the payment of the salary was contingent upon the plaintiff‟s employment redounding to the benefit of the defendant company. 531) the plaintiff had delivered a quantity of hemp into the warehouse of the defendant. it was shown that quantity had been deposited in a specific warehouse. In the Tan Leonco case.. Sugar is one of the staple commodities of this country. Santa Marina (26 Phil 200). 6. Aenlle & Co. In Borromeo vs. The agreement upon the “thing” which was the object of the contract was not within the meaning of article 1450. There is not the slightest intimation in the contract that the sugar was to be raised by Gonzales.. and that he was unable to fulfill the contract by reason of the almost total failure of his crop. 3. So. Since Mitchell was offering to sell by sample shoes.
673). which mistake was deemed pro forma and did not vitiate the consent of the parties or affect the validity and binding effect of the contract of sale. warehoused at another place. consigned to the person by whom the order is given. The land from which the subject coconut fruits are derived from was . A few years later. L. Atilano. His brother thereupon obtained a transfer of certificate in his name. Rugely. the title to which was to pass. when the heirs of the brother had his lots resurveyed for subdivision. Blair & Co. The defect in the final deed would not work to invalidate the contract where all the essential elements for its validity are present ad can be proven.000 paid on account of the price. Years later. in the present case. the sale is perfected and the title passes. 28 SCRA 231 When Deed of Sale is merely an Evidence of the Contract Eulogio acquired by purchase lot 535. the agent receiving the order merely enters into an executory contract for the sale of the goods. the lot which Eulogio was occupying as residence was actually 535-E. 34 Sou. the brother had possession of the subject property and had built his house thereon. he had the land subdivided into five parts.200 by way of indemnity for loss and damages. the defendants therein had made a contract for the sale. Thus. Yu Tek & Co. he obtained a transfer certificate of title in his name. Atilano emphasizes the point that the true contract of sale is intangible or properly a legal concept. Prudencio Alonzo G. in favor of Luis Pichel (VENDEE).. The reason is that when one seeks to sell or buy a real property. in the absence of a more specific agreement on the subject. but that the cotton had been destroyed by fire before it was weighed.36902 30January1982 FACTS OF THE CASE: That Prudencio Alonzo (VENDOR) executed a deed of sale for the coconut fruits of his land in Balactasan Plantation in Lamitan. and which becomes effective for that purpose only when specific goods are thereafter appropriated to the contract. which had been presented to the purchaser.” 9.000 on account of the price. Applicability to present case In Larue & Prevost vs. Stipulation clear. no room for interpretation. Ann. the brother had already been occupying said lot as his residence.. The court held that the object of the sale was actually 535-A. and not by the mere lot number assigned to it in the certificate of title. it was impossible that he and Seegars & Co. to be supplied from a general stock. Under the provisions of article 1255 of the Civil Code contracting parties are free to execute the contracts that they may consider suitable. 547. it was held that in receiving an order for a quantity of goods. one sells or buys the property as he sees it in its actual setting and by its physical metes and bounds. In our opinion there is nothing in the contract under consideration which is opposed to any of these principles. and. and hence there could have been no sale. The brother‟s heirs filed an action in court seeking possession of the real lot 535-E. There cannot be the slightest doubt about the meaning of this language or the intention of the parties. it was discovered that the land they were occupying on the strength of the deed of sale was not lot 535-E. After the subdivision had been effected. In State vs. this is a clear case of liquidated damages. The deed of sale is merely an evidence of the contract. which does not divest or transfer the title of any determinate object.000 which it advanced to Gonzales. or public order. but actually lot 535-A. therefore. et al. had received $3. And when the deed fails to cover the real contract or the true meeting of the minds of the parties.not been manufactured and the rest of which were incorporated in Witt Shoe Co. Liquidated damage The contract plainly states that if Gonzales fails to deliver the 600 piculs of sugar within the timeagreed on.000 and pay the sum of P1. by weight. (110 La. and recognized by the press in which the cotton was stored.. at which time and place. morals. the contract will be rescinded and he will be obliged to return the P3. Thereafter. (10 La. Va. Contracting parties free to stipulate. It was clear that when the brothers entered into a contract they were referring to lot 535-A because even before that. But even prior to the execution of the sale. that such appropriation takes place only when the goods as ordered are delivered to the public carriers at the place from which they are to be shipped. Case of Luis Pichel vs. Shields. American jurisprudence: Recovery of payment. then the deed must give way to the real contract of the parties. It was held that it was still at the risk of the seller. 242). On the other had. of a kind and at a price agreed on. which had a bigger lot area.R.. and had given an order for its delivery. should at that time have agreed upon the specific objects. of a lot of cotton. there was only a mistake in designating the particular lot to be sol in the instrument. Basilan. Similarly. is entitled to recover the P3. Atilano vs. although the deed of sale referred to lot 535-E. There is no room for either interpretation or construction. he executed a deed of sale in favor of his brother supposedly covering lot 535-E. and that the buyer was entitled to recover the $3. provided they are not in contravention of law. 10.‟s stock in Lynchburg. Gonzales having defaulted in his engagement.No.
which shall commence to run as of SEPTEMBER 15. involving property awarded to the former by the Philippine Government under Republic Act No. .The possession of the coconut fruits for 7 years is different from possession of the land. 1968 and executed by Prudencio Alonzo. and it was part of the agreement of the sale that the sum of 3. as vendor." Moreover. as petitioner correctly asserts. the literal meaning of its stipulation shall control. in favor of Luis Pichel. • Contract of Lease. Such is the mandate of the Civil Code of the Philippines which provides that: Art. while in a lease no such transfer of ownership results as the rights of the lessee are limited to the use and enjoyment of the thing leased. Pichel vs. The RTC erred in constructing the deed of sale as a contract of lease. 1976.Yes. It is a document evidencing the agreement of herein parties for the sale of coconut fruits of Lot No. the first and fundamental duty of the courts is the application of the contract according to its express terms. up to JANUARY 1. as vendee. defendant for the first time since the execution of the deed of sale in his favor. due to its supposed violation of RA No. Alonzo 111 SCRA 341 Facts: This case originated in the lower Court as an action for the annulment of a "Deed of Sale" dated August 14.00 was to be paid by the vendor to Ramon Sua as to release the land. Simply and directly stated. in which they equated the deed of sale executed by the parties as a contract of lease. a contract of lease of the land itself? Held: The Supreme Court ruled that construction or interpretation of the document in question is not called for. 1370. Obligations and Contracts Terms: • Difference between a contract of sale and a lease of things: that the delivery of the thing sold transfers ownership. 1458. . due to the fact that the deed of sale that was executed was invalid. nor is there doubt as to the real intention of the contracting parties. . it is the other way around. Construction shall be employed when such literal interpretation is impossible. dismissing the complaint. since there was no ambiguity. caused the harvest of the fruit of the coconut trees in the land. 477. Even during the date of sale. 477. .subjected to a cancellation of the award in 1965.1968. regarding the rule on interpreting contracts. and not for the lease of the land itself as found by the lower Court. The RTC decided in favor of the vendor. the document in question expresses a valid contract of sale. A perusal of the deed failed to disclose any ambiguity or obscurity in its provisions. If the terms of a contract are clear and leave no doubt upon the intention of the contracting parties.200. In July 1972. hence the literal and plain meaning thereof should be observed.a transfer of accessories does not necessarily mean a transfer of principal.650. In clear and express terms. Pursuant to the afore-quoted legal provision.defined as giving or the concession of the enjoyment or use of a thing for a specified time and fixed price. The provisions of the contract itself and its characteristics govern its nature. 1968. It has the essential elements of a contract of sale as defined under Article 1485 of the New Civil Code which provides thus: Art. up to JANUARY 1. . interpretation being resorted to only when such literal application is impossible. Issue: Whether or not the agreement in question is denominated by the parties as a deed of sale of fruits of the coconut trees found in the vendor's land or it actually is. the "Deed of Sale dated August 14. ISSUES OF THE CASE:Was the Deed of Sale valid? . it merely contracts the sale of the fruits of the land. The terms of the agreement are clear and unequivocal. . to the prejudice of petitioner who contracted in good faith and consideration HELD: The Judgment of the lower court has been set aside. for all legal intents and purposes. not the land itself. 21. since the coconut fruits are mere accessories and the land is the principal.C. and another one entered in its place.There was no need on the part of the RTC to interpret the contract. By the contract of sale one of the contracting parties obligates himself to transfer the ownership of and to deliver a determinate thing. That the sale of the coconut fruits are for all the fruits on the aforementioned parcel of land presently found therein as well as for future fruits to be produced on the said parcel of land during the years period. relied upon ART 1370 of the Civil Code.The S. 1976. the document defines the object of the contract thus: "the herein sale of the coconut fruits are for the fruits on the aforementioned parcel of land during the years (from) SEPTEMBER 15. and the other to pay therefore a price certain in money or its equivalent.The vendor after having received the consideration for the sale of his coconut fruits cannot be allowed to impugn the validity of the contracts he entered into. due to the reason of violation of the law that disallows alienation of land (the vendor‟s rights to the land were reinstated in 1972) The vendor and his wife sold to the vendee the fruits of the coconut trees from 1968 to 1976 for consideration of 4. the land was still leased to one Ramon Sua.Its interpretation in express form is the preferred. 1968 is precisely what it purports to be.
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