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GR No.

Heirs of Cayetano Pangan and Consuelo Pangan vs. Spouses Rogelio
Perreras and Priscilla Perreras

Consuelo Pangan agreed to sell their lot and two-door apartment in

Sampaloc, Manila to spouses Perreras for P540,000 and received P20,000 as
earnest money from the latter.
Spouses Perreras issued two checks payable to Consuelo amounting to
P450,000, however, Consuelo refused to accept the checks because of the
refusal of her children/heirs.
Complaint for consignation filed by Consuelo in RTC Manila
Institution of action of specific performance by the Perreras in RTC Manila to
execute a Deed of Absolute Sale over the subject properties.
Consuelos Answer: because of her husbands death, their children as heirs
became co-owners of the subject properties and their consent are needed to
execute the sale.
RTC ruled in favor of the Perreras: it upheld the existence of a perfected
contract of sale, at least insofar as the sale involved Consuelos conjugal and
hereditary shares in the subject properties.
CA ruling: it found that the payment and receipt of earnest money was the
operative act that gave rise to a perfected contract, and that there was
nothing in the parties agreement that would indicate that it was subject to a
suspensive condition.

Was there a perfected contract executed by the Pangans and Perreras?
There was a perfected contract between the parties since all the essential requisites
of a contract were present.
Article 1318 of the Civil Code declares that no contract exists unless the following
requisites concur: (1) consent of the contracting parties; (2) object certain which is
the subject matter of the contract; and (3) cause of the obligation established. Since
the object of the parties agreement involves properties co-owned by Consuelo and
her children, the petitioners-heirs insist that their approval of the sale initiated by
their mother, Consuelo, was essential to its perfection. Accordingly, their refusal
amounted to the absence of the required element of consent.
However, a thing sold without the consent of all the co-owners does not invalidate
the sale or render it void. Article 493 of the Civil Code recognizes the absolute right
of a co-owner to freely dispose of his pro indiviso share as well as the fruits and

other benefits arising from that share, independently of the other co-owners. Thus,
when Consuelo agreed to sell to the respondents the subject properties, what she in
fact sold was her undivided interest that, as quantified by the RTC, consisted of onehalf interest, representing her conjugal share, and one-sixth interest, representing
her hereditary share.
Furthermore, the existence of a perfected contract between the parties are
evidenced by the payment and receipt of P20,000.00, an earnest money by the
contracting parties common usage. Article 1482 of the Civil Code provides that
whenever earnest money is given in a contract of sale, it shall be
considered as part of the price and proof of the perfection of the contract.
SC ruled in favor of the respondents.

GR No. 176474
Heirs of Arturo Reyes vs. Elena Socco-Beltran
Elena Socco-Beltran inherited a parcel of land identified as Lot No. 6-B situated in
Zamora St., Dinalupihan, Bataan which she inherited from her deceased sister
Constancia Socco pursuant to an unnotarized document entitled Extrajudicial
Settlement of the Estate of Deceased Constancia Socco. The subject property was
adjudicated to Elena, but no title had been issued in her name.
In 1998, Elena then filed an application for the purchase of the subject property
before the DAR.
However, heirs of one Arturo Reyes filed their protest to Elenas petition/application
before the DAR on the ground that the subject property was sold by Elenas brother
and co-heir of Constancias estate, Miguel Socco, in favor of their father, Arturo
Reyes, as evidenced by the Contract to Sell, dated 5 September 1954, stipulating
that: Miguel Socco is one of the co-heirs of the Estate of the deceased Constancia
and that he would inherit a portion of the subject properties and that in
consideration of the sum of 5 pesos per square meter, he would sell, convey and
transfer by way of a conditional sale of said subject property to Atty. Arturo C.
Reyes, his heirs, administrator and assigns.

WON the petitioners have a better right to the subject property over the
respondents pursuant on the Contract to Sell executed between Miguel Socco and
Arturo Reyes in 1954?
No, petitioners dont have a better right to the subject property over the
respondents. Petitioners cannot derive title to the subject property by virtue of the
Contract to Sell. It was unmistakably stated in the Contract and made clear to both
parties thereto that the vendor, Miguel R. Socco, was not yet the owner of the
subject property and was merely expecting to inherit the same as his share as a coheir of Constancias estate. It was also declared in the Contract itself that Miguel R.
Soccos conveyance of the subject to the buyer, Arturo Reyes, was a conditional
sale. It is, therefore, apparent that the sale of the subject property in favor of Arturo
Reyes was conditioned upon the event that Miguel Socco would actually inherit and
become the owner of the said property. Absent such occurrence, Miguel R. Socco
never acquired ownership of the subject property which he could validly transfer to
Arturo Reyes.
Under Article 1459 of the Civil Code on contracts of sale, The thing must be licit and
the vendor must have a right to transfer ownership thereof at the time it is
delivered. The law specifically requires that the vendor must have ownership of the
property at the time it is delivered. Petitioners claim that the property was
constructively delivered to them in 1954 by virtue of the Contract to Sell. However,
as already pointed out by this Court, it was explicit in the Contract itself that, at the
time it was executed, Miguel R. Socco was not yet the owner of the property and
was only expecting to inherit it. Hence, there was no valid sale from which
ownership of the subject property could have transferred from Miguel Socco to
Arturo Reyes. Without acquiring ownership of the subject property, Arturo Reyes
also could not have conveyed the same to his heirs, herein petitioners.

GR No. 48194
Jose Javier and Estrella Javier vs. CA and Leonardo Tiro
Leonardo Tiro executed a Deed of assignment concerning his shares of stock in
Timberwealth Corporation on Feb. 15, 1966 in favor of spouses Jose and Estrella
Javier and for the amount of P 120,000. Spouses paid P 20,000 as initial payment
and the balance to be paid in installments as agreed. The parties entered into
another deed on Feb. 28, 1966 for the additional forest concession, subject of a

pending application, adjoining the area covered in the first deed. As agreed, the
payment therefor of P 30,000 shall be paid as soon as the application is approved.
On Nov. 18, 1966, the Dir. of Forestry directed a consolidation for the renewal of the
concession. By virtue of the deed, spouses Javier consolidated with the other
adjoining concessionaires. On July 16, 1968, Tiro filed a complaint for failure of the
spouses to pay the remaining balance. Spouses filed their answer arguing therein
the nullity of the deeds and the return of the payments made by them. It appeared
in record that the Timberwealth Corporation was a non-existent organization. The
trial court dismissed the complaint; hence, Tiro appealed to CA. CA reversed the
judgment. Petition to review filed with SC.
WON the deed of assignment dated February 15, 1966 and the agreement of
February 28, 1966 are null and void, the former for total absence of consideration
and the latter for non-fulfillment of the conditions stated therein? -- Not null and
void; null and void.
Petitioners contend that the deed of assignment conveyed to them the shares of stocks of
private respondent in Timberwealth Corporation, as stated in the deed itself. Since said
corporation never came into existence, no share of stocks was ever transferred to them,
hence the said deed is null and void for lack of cause or consideration.
The true cause or consideration of said deed was the transfer of the forest concession of
private respondent to petitioners for P120,000.00. This finding is supported by the
contemporaneous and subsequent acts of petitioners and private respondent. It is settled
that the previous and simultaneous and subsequent acts of the parties are properly
cognizable indicia of their true intention. Their acts reveal that the cause stated in the
questioned deed of assignment is false.
The deed of assignment of February 15, 1966 is a relatively simulated contract which states
a false cause or consideration, or one where the parties conceal their true agreement. A
contract with a false consideration is not null and void per se. Under Article 1346 of the Civil
Code, a relatively simulated contract, when it does not prejudice a third person and is not
intended for any purpose contrary to law, morals, good customs, public order or public policy
binds the parties to their real agreement.
As to the nullity for the non-fulfilment of the conditions, SC agrees. The efficacy of said deed
of assignment is subject to the condition that the application of private respondent for an
additional area for forest concession be approved by the Bureau of Forestry. Since private
respondent did not obtain that approval, said deed produces no effect. When a contract is
subject to a suspensive condition, its birth or effectivity can take place only if and when the
event which constitutes the condition happens or is fulfilled.
Moreover, under the second paragraph of Article 1461 of the Civil Code, the efficacy of the
sale of a mere hope or expectancy is deemed subject to the condition that the thing will

come into existence. In this case, since private respondent never acquired any right over the
additional area for failure to secure the approval of the Bureau of Forestry, the agreement
executed therefor, which had for its object the transfer of said right to petitioners, never
became effective or enforceable.