CONTRACTS: MISTAKE; VOIDABLE CONTRACT

CASE NAME: The Roman Catholic Church vs. Regino Pante

G.R. No.: G.R. No. 174118
Date: April 11, 2012
Petitioner: The Roman Catholic Church, represented by the Archbishop of Caceres
Respondent: Regino Pante
FACTS:
The Roman Catholic Church, represented by the Archbishop of Caceres sold a 32square meter lot to the respondent Regino Pante, who in the belief of the Church
as an actual occupant of the lot. Terms fixed at a purchase price of P 11,200, a
down payment P 1,120 and a balance payable in three years. Subsequently, the
Church sold a lot to the spouses Rubi, which included the lot that was previously
sold to the respondent Pante. Then, the spouses Rubi erected a fence along the
lot, including the lot of Pante, which blocked the access of Pante from their family
home to the municipal road. Pante instituted an action before the RTC to annul
the sale between the Church and spouses Rubi.
The Church contended that Pante misrepresented that they were the actual
occupant of the said lot. Also, the sale was a mistake that would constitute a
voidable contract because Pante made them believe that he was a qualified
occupant and Pante was aware that they sell lots only to those occupants and
residents. Pante averred that they were using it as passageway from his family
home to the road, which signifies that he is really using the actual lot.
The RTC ruled in favor to the Church, for it was a misrepresentation of
Pante and he delayed in the payment of the lot for he only consigned the balance
with the RTC after the church refused to accept the payments.
Then, the respondent Pante appealed to the appellate court, which
reversed the decision of the RTC and granted the annulment of the sale. Thus, a
petition by the Church was brought before the certiorari.
ISSUE: Whether or not the sale was a voidable contract?

HELD: No, the Supreme Court ruled that there were no misrepresentation made
that would vitiate the consent and render the contract as voidable. As consent as
one of the essential requisites of a valid contract and such consent should be free,
voluntary, willful and a reasonable understanding of the various obligations that
the parties have assumed for themselves. However if consent is given through
mistake, violence, intimidation, undue influence and fraud, it would render a
contract voidable. On Article 1331 of the Civil Code, mistake could only render a
contract voidable if the following requisites concur: 1. the mistake must be either
with regard to the identity or with regard to the qualification of one of the
contracting parties; and 2. the identity or qualification must have been the
principal consideration for the celebration of the contract.
In this case, there is no mistake as to the qualifications as to the policy of
the Church on selling only for those who are occupants and residents, for neither
Pante nor spouses Rubi would qualify as residents of the said 32-square meter lot,
as none of them had occupied or resided on the lot. The lot is a passageway for
the respondent Pante, thus it is considered as his RIGHT OF WAY.
Also, records show that the Parish Priest was aware that Parte was not an actual
occupant and still he allowed the sale to Pante. So, the Church cannot by any
means contend that the Church was misled by the act of Pante, that there was
vitiation of consent on the said sale.
In Article 1390 of the Civil Code declares that voidable contracts are
binding, unless annulled by a proper court action. From the time the sale to Pante
was made and up until it sold the subject property to the spouses Rubi, the
Church made no move to reject the contract with Pante; it did not even return the
down payment he paid. The Churchs bad faith in selling the lot to Rubi without
annulling its contract with Pante negates its claim for damages.
There was no vitiation of consent; therefore, the contract between the
Church and Pante stands valid and existing. The delay of Pante in paying the full
price could not nullify the contract, since it was a contract of sale (as correctly
observed by the CA). In the terms of the contract, it did not stipulate that the
Church will retain ownership until full payment of the price. The right to
repurchase given to the Church if ever Pante fails to pay within the grace period

provided would have been unnecessary had ownership not already passed to
Pante.