Mapalo vs Mapalo

Facts:

The spouses Miguel Mapalo and Candida Quiba were the registered owners of a residential land located
in Pangasinan. (1,635 sq. m.)

The spouses donated the eastern half of the land to Miguels brother Maximo Mapalo who was about
to get married.

However, they were deceived into signing, on October 15, 1936, a deed of absolute sale over the entire
land in Maximos favor. Their signatures were procured by fraud because they were made to believe by
Maximo and the lawyer who acted as notary public who "translated" the document, that the same was a
deed of donation in Maximo's favor covering one-half of their land. (It must be noted that the spouses
are illiterate farmers).

Although the document of sale stated a consideration of Five Hundred (P500.00) Pesos, the aforesaid
spouses did not receive anything of value for the land.

In 1938, Maximo Mapalo, without the consent of the spouse, registered the sale in his favor.

After thirteen years (1951), he sold the land to the Narcisos. (Evaristo, Petronila Pacifico and Miguel)
who thereafter registered the sale and obtained a title in their favor.

In 1952, the Narcisos filed a complaint with the CFI to be declared owners of the entire land, for
possession of its western portion; for damages; and for rentals.

The Mapalo spouses filed a counterclaim seeking cancellation of the the Narcisos titles as to the
western half of the land. They said that their signatures to the deed of sale of 1936 was procured by
fraud and that the Narcisos were buyers in bad faith.

They also filed another complaint wherein they asked the court to declare deeds of sale of 1936 and of
1951 over the land in question be declared null and void as to the western half of said land.

CFI ruled in favor of the Mapalo spouses. Upon appeal filed by Narcisos, CA reversed the lower courts
ruling solely on the ground that the consent of the Mapalo spouses to the deed of sale of 1936 having
been obtained by fraud, the same was voidable, not void ab initio, and, therefore, the action to annul
the same, within four years from notice of the fraud, had long prescribed. (From March 15, 1938).
Hence, this appeal

Issues:

1. WON the deed of sale executed in 1936 was null and void. YES

2. WON the Narcisos were purchasers in good faith. NO

Held:

1st issue: YES, the sale was void.The Civil Code governs the transaction because it was executed in 1936

Accordingly, since the deed of sale of 1936 is governed by the Old Civil Code, it should be asked whether
its case is one wherein there is no consideration, or one with a statement of a false consideration. If the
former, it is void and inexistent; if the latter, only voidable, under the Old Civil Code.

There is lack of consideration

As observed earlier, the deed of sale of 1936 stated that it had for its consideration Five Hundred
(P500.00) Pesos. In fact, however, said consideration was totally absent. The problem, therefore, is
whether a deed which states a consideration that in fact did not exist, is a contract without
consideration, and therefore void ab initio, or a contract with a false consideration, and therefore, at
least under the Old Civil Code, voidable.

When there is no consideration, the contract is null and void

According to Manresa, what is meant by a contract that states a false consideration is one that has in
fact a real consideration but the same is not the one stated in the document.

In our view, therefore, the ruling of this Court in Ocejo, Perez & Co. vs. Flores, 40 Phil. 921, is squarely
applicable herein. In that case we ruled that a contract of purchase and sale is null and void and
produces no effect whatsoever where the same is without cause or consideration in that the purchase
price which appears thereon as paid has in fact never been paid by the purchaser to the vendor.

2nd issue: No, they were no purchasers in good faith.Narcisos were not buyers in good faith

Aside from the fact that all the parties in these cases are neighbors, except Maximo Mapalo the
foregoing facts are explicit enough and sufficiently reveal that the Narcisos were aware of the nature
and extent of the interest of Maximo Mapalo their vendor, over the above-described land before and at
the time the deed of sale in their favor was executed.

The Narcisos were purchaser-in-value but not purchasers in good faith

What was the necessity, purpose and reason of Pacifico Narciso in still going to the spouses Mapalo and
asked them to permit their brother Maximo to dispose of the above-described land? To this question it
is safe to state that this act of Pacifico Narciso is a conclusive manifestation that they (the Narcisos) did
not only have prior knowledge of the ownership of said spouses over the western half portion in
question but that they also have recognized said ownership. It also conclusively shows their prior
knowledge of the want of dominion on the part of their vendor Maximo Mapalo over the whole land
and also of the flaw of his title thereto. Under this situation, the Narcisos may be considered purchasers
in value but certainly not as purchasers in good faith.
Bagnas v. CA

Facts:

Hilario Mateum died on March 11, 1964, single, without ascendants or descendants, and survived only
by petitioners who are his collateral relatives. He left no will, no debts, and an estate consisting of 29
parcels of land in Kawit and Imus, 10 of which are involved in this controversy. On April 3, 1964,
respondents who are also collateral relatives of the deceased, but more remote, registered 2 deeds of
sale purportedly executed by Mateum in their favor. The considerations were P1.00 and services
rendered, being rendered, and to be rendered for my benefit. On the strength of the deeds,
respondents were able to secure title over the 10 parcels of land. On May 22, 1964, petitioners
commenced a suit against respondents, seeking annulment of the deeds of sale a fictitious, fraudulent
or falsified or, alternatively, as donations void for want of acceptance in public instrument. Respondents
contend that the sales were made for valuable considerations, and attacked the legal standing of the
petitioners as being mere collateral heirs.

Issues:

(1) Whether petitioners have the legal standing to sue

(2) Whether the sale is void for want of consideration

Held:

(1) The law as it is now no longer deems contracts with a false cause, or which are absolutely simulated
or fictitious, merely voidable, but declares them void, i.e., inexistent ("nulo") unless it is shown that they
are supported by another true and lawful cause or consideration. A logical consequence of that change
is the juridical status of contracts without, or with a false, cause is that conveyances of property affected
with such a vice cannot operate to divest and transfer ownership, even if unimpugned. If afterwards the
transferor dies the property descends to his heirs, and without regard to the manner in which they are
called to the succession, said heirs may bring an action to recover the property from the purported
transferee. As pointed out, such an action is not founded on fraud, but on the premise that the property
never leaves the estate of the transferor and is transmitted upon his death to heirs, who would labor
under no incapacity to maintain the action from the mere fact that they may be only collateral relatives
and bound neither principally or subsidiarily under the deed or contract of conveyance.

(2) Upon the consideration alone that the apparent gross, not to say enormous, disproportion between
the stipulated price (in each deed) of P l.00 plus unspecified and unquantified services and the
undisputably valuable real estate allegedly sold worth at least P10,500.00 going only by assessments for
tax purposes which, it is well-known, are notoriously low indicators of actual value plainly and
unquestionably demonstrates that they state a false and fictitious consideration, and no other true and
lawful cause having been shown, the Court finds both said deeds, insofar as they purport to be sales, not
merely voidable, but void ab initio. Neither can the validity of said conveyances be defended on the
theory that their true causa is the liberality of the transferor and they may be considered in reality
donations because the law also prescribes that donations of immovable property, to be valid, must be
made and accepted in a public instrument, and it is not denied by the respondents that there has been
no such acceptance which they claim is not required. The transfers in question being void, it follows as a
necessary consequence and conformably to the concurring opinion in Armentia, with which the Court
fully agrees, that the properties purportedly conveyed remained part of the estate of Hilario Mateum,
said transfers notwithstanding, recoverable by his intestate heirs, the petitioners herein, whose status
as such is not challenged.

ting ho vs teng gui

Facts:

Felix Ting Ho, Jr., Merla Ting Ho Braden, Juana Ting Ho and Lydia Ting Ho Belenzo against their brother,
respondent Vicente Teng Gui. The controversy revolves around a parcel of land, and the improvements
which should form part of the estate of their deceased father, Felix Ting Ho, and should be partitioned
equally among each of the siblings. Petitioners alleged that their father Felix Ting Ho died intestate on
June 26, 1970, and left upon his death an estate. According to petitioners, the said lot and properties
were titled and tax declared under trust in the name of respondent Vicente Teng Gui for the benefit of
the deceased Felix Ting Ho who, being a Chinese citizen, was then disqualified to own public lands in
thePhilippines; and that upon the death of Felix Ting Ho, the respondent took possession of the same
for his own exclusive use and benefit to their exclusion and prejudice.

Issue:

Whether or not the sale was void

Ruling:

No, the sale was not void. Article 1471 of the Civil Code has provided that if the price is simulated, the
sale is void, but the act may be shown to have been in reality a donatin, or some other act or contract.
The sale in this case, was however valid because the sale was in fact a donation. The law requires
positive proof of the simulation of the price of the sale. But since the finding was based on a mere
assumption, the price has not been proven to be a simulation.

philippine free press vs ca

Tan Tiah vs Yu Jose

This is an appeal by way of certiorari taken by Tan Tiah (alias T. Suya), wherein he prays, on the
grounds alleged therein, for the review of the decision rendered in the case by the Court of Appeals
reversing that of the Court of First Instance of Leyte, for the reversal thereof, and for the affirmance
of the decision of said Court of First Instance.

As grounds for the allowance of the appeal, petitioner assigns the following alleged errors of law
committed by said Court of Appeals in its decision, to wit:

1. The Court of Appeals erred in finding in its decision, subject of the present petition
for certiorari, that the 5th paragraph of the contract of lease Exhibit A establishes rights for
the petitioner and for the respondent, which are antagonistic and, therefore, unenforceable
by action.

2. The Court of Appeals likewise erred in finding in its decision that the promise, if any, made
by respondent to sell to petitioner the land in question is not enforceable by action for lack of
a price.

3. The Court of Appeals also erred in finding in its decision that the 5th paragraph of the
contract of lease entered into by petitioner and respondent does not state two promises to
buy and to sell which are mutually demandable.

4. Lastly, the Court of Appeals erred in holding that the herein petitioner has no cause of
action against defendant-respondent.

5. On May 14, 1923 petitioner and respondent entered into a contract of lease in the fifth
clause of which, pertinent to the question at issue, provides:

5th. That upon termination of the period of this contract, namely, ten years, the lessor shall have the
option to buy the building or improvement which the lessee may have built upon the lots, reimbursing
the latter ninety per cent (90%) of the original net cost of the construction; but should the lessor be
unable or unwilling to buy said building or improvement, the income or rent derived therefrom shall
be equally divided between said lessor and lessee, and the latter shall no longer have the obligation
to pay the rent agreed upon for the lots in the second paragraph of this contract; provided, however,
that the present contract, with the modification just mentioned, with respect to the income from the
building and the rent from the lot, shall continue in force until the lessor buys the building or
improvement or the lessee buys the land.

The judgment rendered by the Court of First Instance of Leyte and reversed by the Court of Appeals,
which absolved the defendant is as follows:

Wherefore, judgment is rendered sentencing defendant to buy the house of plaintiff or to sell
to plaintiff the land on which the latter's house is built. Each of the parties must submit the
name of a person to be appointed commissioner for the assessment and appraisal of the
land on which plaintiff's house is built.

Defendant is sentenced to pay the costs of the suit.

The main question to be decided in this appeal is whether plaintiff, as lessee, has a right, by virtue of
the aforecited fifth clause of the contract of lease, to compel defendant as lessor, to sell to him the
land on which he built his house in accordance with said contract.
It will be seen that the lessor is given the preference of buying the building erected on the leased
land at a price equivalent to 90 per cent of the original net cost of the construction upon the
termination of the ten years fixed in the contract as the duration of the lease. As ten years have
elapsed and the lessor has not exercised his right to buy the building, and has no intention to do so,
may the lessee compel the lessor to sell to him the leased land? The lessee is not given the option
to buy the land. The grant of said right may not be inferred from the conditional clause of paragraph
5 and from paragraph 4 of the contract since neither in the conditional clause aforecited nor in the
fourth paragraph of the contract is the lessor bound to sell the questioned land to the lessee.
Furthermore, in the said conditional clause the price which the lessee would have to pay should he
decide to buy the land is not fixed. Article 1445 of the Civil Code provides that "By the contract of
purchase and sale one of the contracting parties binds himself to deliver a determinate thing and the
other to pay a certain price therefor in money or in something representing the same." According to
article 1451, "a promise to sell or buy, when there is an agreement as to the thing and the price,
entitles the contracting parties reciprocally to demand the fulfillment of the contract." And article 1447
of the same Code provides that in order that the price may be considered certain, it shall be
sufficient that it be so in relation to some certain thing, or that its determination be left to the
judgment of some particular person, and should the latter be unable or unwilling to fix the price, the
contract shall be inoperative. And according to article 1449 of the same Code, the designation of the
price can never be left to the determination of one of the contracting parties.

As we have said, a price certain which the lessee should pay the lessor for the land in case he
should desire to buy it has not been fixed; neither has anything which may have definite value or
which may serve as a basis for the fixing of the price been designated. Also, no determinate person
has been named to fix the price.

The price of the leased land not having been fixed and the lessor not having bound himself to sell it,
the essential elements which give life to the contract are lacking. It follows that the lessee cannot
compel the lessor to sell the leased land to him.

Having arrived at this conclusion, we do not find sufficient grounds for reversing the decision
appealed from, which is hereby affirmed, with costs against the appellant.

Velasco vs CA

Facts:

Suit for specific performance filed by Lorenzo Velasco against the Magdalena Estate, Inc.

Plaintiffs Version

On Nov 29, 1962 the plaintiff and the defendant had entered into a CONTRACT OF SALE of land (2,059 sq m) at
for P100,000.00.

Payment terms:

o down payment: P10,000.00 and P20,000.00

o P70,000.00 would be paid in installments

o equal monthly amortization will be determined as soon as the P30,000.00 DP had been completed.

Plaintiff paid P10,000.00 on November 29, 1962 (Exh. "A")

 On Jan 8, 1964 he tendered the payment of P20,000.00 but the defendant refused to accept and refused to execute
a formal deed of sale.

Socorro Velasco is his sister-in-law and that he had requested her to make the necessary contacts referring to the
purchase of the property because he does not understand English well.

The receipt states: "Earnest money for the purchase of Lot 15, Block 7, Psd-6129, Area 2,059 square meters
including improvements thereon P10,000.00." At the bottom of Exhibit A the following appears: "Agreed price:
P100,000.00, P30,000.00 down payment, bal. in 10 years."

Defendant:

No contract of sale was perfected because the minds of the parties did not meet "in regard to the manner of
payment.

Contract is unenforceable under the Statute of Frauds.

the property was leased by Socorro Velasco and that the defendant indicated its willingness to sell the property for
P100,000.00:

o P30,000.00

o P20,000.00 of which was to be paid on November 31, 1962,

o P70,000.00 including interest a 9% per annum was to be paid on installments for a period of ten years at the rate of
P5,381.32 on June 30 and December of every year until the same shall have been fully paid;

On November 29, 1962 Socorro Velasco offered to pay P10,000.00 as initial payment instead of the agreed
P20,000.00 but because the amount was short of the alleged P20,000.00 the same was accepted merely as
deposited and upon request of Socorro Velasco the receipt was made in the name of her brother-in-law the plaintiff
herein;

Socorro Velasco failed to complete the down payment of P30,000.00 and neither has she paid any installments on
the balance of P70,000.00 up to the present time;

On January 8, 1964 that Socorro Velasco tendered payment of P20,000.00, which offer the defendant refused to
accept because it had considered the offer to sell rescinded on account of her failure to complete the down payment
on or before December 31, 1962.

Issue: Whether the talks between the Magdalena Estate, Inc. and Lorenzo Velasco ever ripened into a consummated
sale? NO.

Ratio:

The material averments contained in the petitioners' complaint disclose a lack of complete "agreement in regard to
the manner of payment" of the lot in question. The complaint states pertinently:

o 4. That plaintiff and defendant further agreed that the total down payment shall by P30,000.00, including the
P10,000.00 partial payment mentioned in paragraph 3 hereof, and that upon completion of the said down payment of
P30,000.00, the balance of P70,000.00 shall be said by the plaintiff to the defendant in 10 years from November 29,
1962;

o 5. That the time within the full down payment of the P30,000.00 was to be completed was not specified by the
parties but the defendant was duly compensated during the said time prior to completion of the down payment of
P30,000.00 by way of lease rentals on the house existing thereon which was earlier leased by defendant to the
plaintiff's sister-in-law, Socorro J. Velasco, and which were duly paid to the defendant by checks drawn by plaintiff.

Petitioners admit that they still had to meet and agree on how and when the down-payment and the installment
payments were to be paid.

Such being the situation, it cannot be said that a definite and firm sales agreement between the parties had been
perfected over the lot in question.

Indeed, this Court has already ruled before that a definite agreement on the manner of payment of the purchase
price is an essential element in the formation of a binding and enforceable contract of sale.

The fact that the petitioners delivered to the respondent the sum of P10,000 cannot be considered as sufficient
proof of the perfection of any purchase and sale agreement between the parties herein under article 1482 of the new
Civil Code, as the petitioners themselves admit that some essential matter the terms of payment still had to be
mutually covenanted.

toyota shaw vs ca

FACTS:

Luna L. Sosa and his son, Gilbert, went to purchase a yellow Toyota Lite Ace from the Toyota office at
Shaw Boulevard, Pasig (petitioner Toyota) on June 14, 1989 where they met Popong Bernardo who was
a sales representative of said branch. Sosa emphasized that he needed the car not later than June 17,
1989 because he, his family, and a balikbayan guest would be using it on June 18 to go home to
Marinduque where he will celebrate his birthday on June 19. Bernardo assured Sosa that a unit would
be ready for pick up on June 17 at 10:00 in the morning, and signed the "Agreements Between Mr. Sosa
& Popong Bernardo of Toyota Shaw, Inc., a document which did not mention anything about the full
purchase price and the manner the installments were to be paid. Sosa and Gilbert delivered the down
payment of P100,000.00 on June 15, 1989 and Bernardo accomplished a printed Vehicle Sales Proposal
(VSP) No. 928 which showed Sosas full name and home address, that payment is by "installment," to be
financed by "B.A.," and that the "BALANCE TO BE FINANCED" is "P274,137.00", but the spaces provided
for "Delivery Terms" were not filled-up.

When June 17 came, however, petitioner Toyota did not deliver the Lite Ace. Hence, Sosa asked that his
down payment be refunded and petitioner Toyota issued also on June 17 a Far East Bank check for the
full amount of P100,000.00, the receipt of which was shown by a check voucher of Toyota, which Sosa
signed with the reservation, "without prejudice to our future claims for damages." Petitioner Toyota
contended that the B.A. Finance disapproved Sosas the credit financing application and further alleged
that a particular unit had already been reserved and earmarked for Sosa but could not be released due
to the uncertainty of payment of the balance of the purchase price. Toyota then gave Sosa the option to
purchase the unit by paying the full purchase price in cash but Sosa refused.
The trial court found that there was a valid perfected contract of sale between Sosa and Toyota which
bound the latter to deliver the vehicle and that Toyota acted in bad faith in selling to another the unit
already reserved for Sosa, and the Court of Appeals affirmed the said decision.

ISSUE: Was there a perfected contract of sale between respondent Sosa and petitioner Toyota?

COURT RULING:

The Supreme Court granted Toyotas petition and dismissed Sosas complaint for damages because the
document entitled Agreements Between Mr. Sosa & Popong Bernardo of Toyota Shaw, Inc., was not a
perfected contract of sale, but merely an agreement between Mr. Sosa and Bernardo as private
individuals and not between Mr. Sosa and Toyota as parties to a contract.

There was no indication in the said document of any obligation on the part of Toyota to transfer
ownership of a determinate thing to Sosa and neither was there a correlative obligation on the part of
the latter to pay therefor a price certain. The provision on the downpayment of P100,000.00 made no
specific reference to a sale of a vehicle. If it was intended for a contract of sale, it could only refer to a
sale on installment basis, as VSP No.928 executed on June 15, 1989 confirmed. The VSP also created no
demandable right in favor of Sosa for the delivery of the vehicle to him, and its non-delivery did not
cause any legally indemnifiable injury.

REPUBLIC v. PHILIPPINE RESOURCES DEVELOPMENT CORPORATION

Doctrine:

Article 1458 provides that the purchaser may pay a price certain in money or its equivalent, which
means that the price need not be in money.

Facts:

The Bureau of Prisons instituted a complaint against Macario Apostol for the latters failure to pay the
unpaid balance for logs purchased. Apostol, who was then the president of the respondent corporation,
delivered goods belonging to the corporation and without the knowledge or consent of the stockholders
thereof, to the Bureau of Prisons in an attempt to settle his personal debts with the latter entity. The
corporation demanded the Bureau of Prisons for the return of the goods. Upon the refusal of the
Bureau, the corporation filed a motion to intervene.

Issue:Whether or not price is limited only to be paid in money

Held:No. Article 1458 provides that the purchaser may pay a price certain in money or its equivalent,
which means that they meant of the price need not be in money. In this case, the materials have been
assessed and evaluated and their price equivalent in terms of money have been determined and that
said materials for whatever price they have been assigned were considered as tokens of payment.

Spouses Serrano and Herrera vs Ca

san miguel properties vs huang

Nature of the Case: A petition for review for a decision of the Court of Appeals which
reversed the decision of the RTC dismissing the complaint brought by the Huangs against San
Miguel Properties for enforcement of a contract of sale.

Facts: San Miguel Properties offered two parcels of land for sale and the offer was made to an
agent of the respondents. An earnest-deposit of P1 million was offered by the respondents
and was accepted by the petitioners authorized officer subject to certain terms.

Petitioner, through its executive officer, wrote the respondents lawyer that because ethe
parties failed to agree on the terms and conditions of the sale despite the extension granted by
the petitioner, the latter was returning the earnest-deposit.

The respondents demanded execution of a deed of sale covering the properties and attempted
to return the earnest-deposit but petitioner refused on the ground that the option to purchase
had already expired.

A complaint for specific performance was filed against the petitioner and the latter filed a
motion to dismiss the complaint because the alleged exclusive option of the respondents
lacked a consideration separate and distinct from the purchase price and was thus
unenforceable; the complaint did not allege a cause of action because there was no meeting of
the mind between the parties and therefore the contact of sale was not perfected.

The trial court granted the petitioners motion and dismissed the action. The respondents filed
a motion for reconsideration but were denied by the trial court. The respondents elevated the
matter to the Court of Appeals and the latter reversed the decision of the trial court and held
that a valid contract of sale had been complied with.

Petitioner filed a motion for reconsideration but was denied.

Issue: WON there was a perfected contract of sale between the parties
Ruling: The decision of the appellate court was reversed and the respondents complaint
was dismissed.

Ratio Decidendi: It is not the giving of earnest money , but the proof of the concurrence of
all the essential elements of the contract of sale which establishes the existence of a perfected
sale.

The P1 million earnest-deposit could not have been given as earnest money because at the
time when petitioner accepted the terms of respondents offer, their contract had not yet been
perfected. This is evident from the following conditions attached by respondents to their letter.
The first condition for an option period of 30 days sufficiently shows that a sale was never
perfected. As petitioner correctly points out, acceptance of this condition did not give rise to a
perfected sale but merely to an option or an accepted unilateral promise on the part of
respondents to buy the subject properties within 30 days from the date of acceptance of the
offer. Such option giving respondents the exclusive right to buy the properties within the period
agreed upon is separate and distinct from the contract of sale which the parties may enter. All
that respondents had was just the option to buy the properties which privilege was not,
however, exercised by them because there was a failure to agree on the terms of payment. No
contract of sale may thus be enforced by respondents.

Even the option secured by respondents from petitioner was fatally defective. Under the second
paragraph of Art. 1479, an accepted unilateral promise to buy or sell a determinate thing for a
price certain is binding upon the promisor only if the promise is supported by a distinct
consideration. Consideration in an option contract may be anything of value, unlike in sale
where it must be the price certain in money or its equivalent. There is no showing here of any
consideration for the option. Lacking any proof of such consideration, the option is
unenforceable.

Equally compelling as proof of the absence of a perfected sale is the second condition that,
during the option period, the parties would negotiate the terms and conditions of the purchase.
The stages of a contract of sale are as follows: (1) negotiation, covering the period from the time
the prospective contracting parties indicate interest in the contract to the time the contract is
perfected; (2) perfection, which takes place upon the concurrence of the essential elements of the
sale which are the meeting of the minds of the parties as to the object of the contract and upon
the price; and (3) consummation, which begins when the parties perform their respective
undertakings under the contract of sale, culminating in the extinguishment thereof.
In the present case, the parties never got past the negotiation stage. The alleged indubitable
evidence of a perfected sale cited by the appellate court was nothing more than offers and
counter-offers which did not amount to any final arrangement containing the essential
elements of a contract of sale. While the parties already agreed on the real properties which
were the objects of the sale and on the purchase price, the fact remains that they failed to
arrive at mutually acceptable terms of payment, despite the 45-day extension given by
petitioner.