Re: Received three-page arguments (pars. 34-40) by opposing lawyer, Atty.

Britanico

Keidan Landholdings Corp. vs. Hon. Soriano, et. al.

Despite applicability of the Maceda Law R. A.
6552, Petitioners are not entitled to surrender cash
value of fifty percent (50%)

Referring to par. 34 of the Petition, in the same case that the Petitioners cited, Rillo vs. Court of
Appeals, the Supreme Court applied the Maceda Law on the premise that the subject contract
was a contract to sell. Same conclusion may be applied in the present case, however, what the
Petitioner conveniently omitted was the ruling of the Supreme Court in Rillo that since the
buyers failed to make instalments for two years, they are not entitled to the refund of fifty
percent (50%). Petitioners merely paid for a period of twenty (22) months, hence, entitled only to
the 60-day grace period, as provided in Sec. 4 of R. A. 6552, but not to the surrender cash value.

"Sec. 4. x x x the seller shall give the buyer a grace period of not less than sixty
days from the date the installment became due. If the buyer fails to pay the
installments due at the expiration of the grace period, the seller may cancel the
contract after thirty days from receipt by the buyer of the notice of cancellation or
the demand for rescission of the contract by a notarial act.

Petitioner RILLO paid less than two years in installment payments, hence,
he is only entitled to a grace period of not less than sixty (60) days from the due
date within which to make his installment payment. CORB REALTY, on the
otherhand, has the right to cancel the contract after thirty (30) days from receipt
by RILLO of the notice of cancellation. Hence, the respondent court did not err
when it upheld CORB REALTY's right to cancel the subject contract upon
repeated defaults in payment by RILLO.1"

The Memorandum of Agreement (MOA) constituted
Deed of Absolute Sale and not a mere Contract to Sell

In contrast to what the Petitioners’ claim that the MOA was a contract to sell, it was in truth and
in fact, an absolute sale that transferred the ownership and possession of the subject properties to
the Petitioners. A perusal of the MOA would tell us that:

1 G. R. No. 125347, June 19, 1997,
http://sc.judiciary.gov.ph/jurisprudence/1997/jun1997/125347.htm.

thus: Art. iv) Cash and the five post-dated checks referred to in 2. it shall be the responsibility of the BUYERto deliver to the SELLER through its Chairman and CEO within five (5) days from date hereof the following documents: i) Individual Deed of Absolute Sale on the properties referred to in 2.The manner of payment the Seller and the Buyer agreed upon was. 2011. 188064. “On the part of the BUYER For the purposes of the preceding paragraphs.a above. partly in kind and partly by way of an acknowledgment of debt. June 1.c above. The essential elements of a contract of sale are the following: 2 2.”2 hence the original action for collection of sum of money. 3 3. “partly in cash. the SELLER shall be bound to do the following: xxx iii) to deliver possession of the Pantabangan Property to the BUYER. . Memorandum of Agreement (MOA) dated January 17. by its very nature. 2003. By the contract of sale. the Supreme Court distinguished Contract of Sale and Contract to Sell as follows: A contract of sale is defined in Article 1458 of the Civil Code. one of the contracting parties obligates himself to transfer the ownership of and to deliver a determinate thing. No. Tuparan. G. 1458. leading to foreclosure of the subject properties. ii) The Ownere’s Duplicate copies of TCT No. xxx Sale. then owned and transferred to the Petitioners by virtue of the following provisions: “Upon full performance by the BUYER of its obligation described in 3 (a) above. iii) Secretary’s Certificate authorizing the sale of the above properties. R. Manner of Payment. page 1. OBLIGATION OF THE BUYER AND SELLERa) page 3 of the MOA. 111. and the other to pay therefor a price certain in money or its equivalent.” In the case Reyes vs.b above. 173960 and 471676 their corresponding Tax Declarations and Tax Receipts evidencing payment for the year 2003 all reality taxes due thereon. and v) The promissory note referred to in 2. is a consensual contract because it is perfected by mere consent.

If the suspensive condition is not fulfilled. because in a conditional contract of sale. the prospective sellers obligation to sell the subject property by entering into a contract of sale with the prospective buyer becomes demandable as provided in Article 1479 of the Civil Code which states: Art. A contract to sell may thus be defined as a bilateral contract whereby the prospective seller. the prospective seller explicitly reserves the transfer of title to the prospective buyer. the full payment of the purchase price partakes of a suspensive condition. An accepted unilateral promise to buy or to sell a determinate thing for a price certain is binding upon the promissor if the promise is supported by a consideration distinct from the price. which for present purposes we shall take as the full payment of the purchase price. thus. while expressly reserving the ownership of the subject property despite delivery thereof to the prospective buyer. that is. the non-fulfillment of which prevents the obligation to sell from arising and. a) Consent or meeting of the minds. In other words. the prospective seller does not as yet agree or consent to transfer ownership of the property subject of the contract to sell until the happening of an event. may not even be considered as a conditional contract of sale where the seller may likewise reserve title to the property subject of the sale until the fulfillment of a suspensive condition. Under this definition. meaning. ownership is retained by the prospective seller without further remedies by the prospective buyer. In a contract to sell. upon the fulfillment of the suspensive condition which is the full payment of the purchase price. However. although it is conditioned upon the happening of a contingent event which may or may not occur. A contract to sell as defined hereinabove. ownership thereto . the contract of sale is thereby perfected. a Contract to Sell may not be considered as a Contract of Sale because the first essential element is lacking. and c) Price certain in money or its equivalent. xxx xxx xxx Stated positively. A promise to buy and sell a determinate thing for a price certain is reciprocally demandable. 1479. the perfection of the contract of sale is completely abated. if the suspensive condition is fulfilled. that is. the first element of consent is present. What the seller agrees or obliges himself to do is to fulfill his promise to sell the subject property when the entire amount of the purchase price is delivered to him. binds himself to sell the said property exclusively to the prospective buyer upon fulfillment of the condition agreed upon. consent to transfer ownership in exchange for the price. such that if there had already been previous delivery of the property subject of the sale to the buyer. full payment of the purchase price. b) Determinate subject matter.

G. 184950. ownership will not automatically transfer to the buyer although the property may have been previously delivered to him. That the actual cancellation of the contract shall take place after thirty days from receipt by the buyer of the notice of cancellation or the demand for rescission of the contract bya notarial act and upon full payment of the cash surrender value to the buyer. making the non-payment of purchase price a suspensive condition for its perfection. an additional five percent every year but not to exceed ninety percent of the total payments made: Provided. 204160. they have possession and ownership of the subject property.4 4 NGEI Multi-Purpose Cooperative vs. No. upon the fulfillment of the suspensive condition which is the full payment of the purchase price. automatically transfers to the buyer by operation of law without any further act having to be performed by the seller. Oct.” The present case falls within the definition of a contract of sale where the possession and ownership of the property was transferred to the buyer. The non-satisfaction of full purchase price warrants its collection and not the rescission of the contract. Noynay vs. when all along. properties and debt. the MOA is a contract of sale. 2012. to wit: (b) If the contract is cancelled. There it was held that the cancellation of the contract by the seller must be in accordance with Section 3 (b) of the Maceda Law. In a contract to sell. Neither can the Petitioner insist that notarial cancellation was required nor that the Petition was for the annulment of the MOA due to the alleged non-compliance of suspensive condition of payment of the purchase price because as discussed above. R. The prospective seller still has to convey title to the prospective buyer by entering into a contract of absolute sale. which requires the notarial act of rescission and the refund to the buyer of the full payment of the cash surrender value of the payments made on the property. The actual cancellation of the contract takes place after thirty (30) days from receipt by the buyer of the notice of cancellation or the demand for rescission of the contract by a notarial act and upon fullpayment of the cash surrender value to the buyer. after five years of installments. (emphasis supplied) Here. in consideration of money. Cancellation of the sale requires notarial act In the case of Sps. there was no notarial cancellation of the MOA.11. 22. “ the importance of complying with the provisions of the Maceda Law as to the cancellation of contracts to sell involving realty installment schemes. . the Supreme Court held that. The Petitioners cannot now claim that what they entered into was a mere Contract to Sell. To annul a contract cannot be done unilaterally. the seller shall refund to the buyer the cash surrender value of the payments on the propertyequivalent to fifty percent of the total payments made and. No. G. 2014. Citihomes Builder and Development. Filipinas Palmoil. Sept.R.