ESTEBAN BARRETTO v. MANILA RAILROAD CO.

○ Barretto has no cause of action, even though MRC failed to accept

Formation of Contract of Sale | March 29, 1924 | J. Ostrand
Nature of Case: Appeal
Digest maker: MReynoso
SUMMARY: Manila Railroad Company sought to buy Barretto’s house (which
was situated in the former’s land). They executed a deed of sale. Later, Manila
Railroad Company failed to pay the purchase price, even after multiple attempts
by Barretto. The former returned the deed.
DOCTRINE: Where timely objections are made to the introduction of parol
evidence to prove a sale of real property and due exceptions are taken to the
adverse rulings, such evidence must be disregarded by the courts and the contract
cannot be enforced.
the deed after they offered to buy the house. During the trial, MRC
made timely objections to the introduction of parol evidence to
prove the contract of sale and took out due exceptions to the
adverse rulings of the court. Art. 1278 and 1279 of the CC do not
apply.
○ In the present case, it is very clear that there was no delivery of the
deed with the intention to part with the title until the purchase
price was paid, and it was equally clear that there was no final
acceptance of the deed. The deed was returned.
RULING:
Judgment reversed. Ruled in favor of Manila Railroad Company.

FACTS:
● Feb. 11, 1922 - According to Barretto, Manila Railroad Co. (MRC) offered to
purchase Barretto’s house (No. 1210 Calle Dagupan) that was on MRC’s
land for P3,700.
o Barretto agreed, and they executed a deed of sale of the house. But
upon the presentation of the deed to MRC, they refused to pay the
purchase price.
o MRC: Denies the allegations. Also, the agreement referred to by
Barretto was not in writing, and therefore not enforceable under the
Statute of Frauds.
● There is evidence to show that on Feb 2, 1922, the general manager of MRC
asked J.C. Miller (right-of-way agent of MRC) about the two houses situated
in Calle Dagupan, and the former also inquired if the purchase of the houses
would be advantageous for the company.
o Miller: Yes. Since renting the building, it has cost them P20,801. It
would be better if they just bought it.
● The general manager then authorized the purchase. MRC told Barretto to go
to Miller’s office to execute the deed for the house. Barretto did, and they
executed. He was told to come back to the office in the afternoon to receive
the purchase price.
● When he returned, MRC said that the general manager was not there, and
he would not be paid until the general manager returned. He made other
unsuccessful attempts to collect the purchase money. Miller returned the
deed to keep until payment.
● Court: There had been a sufficient part performance on Barretto’s part to
take the contract out of the Statute of Frauds. Ruled in favor of Barretto.
● MRC Appealed.

ISSUE/S & RATIO:

1. W/N the delivery of the deed takes the case out of the Statute of Frauds?
NO
○ It is well settled that the delivery of the deed to the agent of the
vendee, with no intention to part with the title, does not take the
case out of the Statute of Frauds