Martin, Michael Alexey D.R.

Gross inadequacy of price

Sales / 2B Article 1470
Case Digest Spouses Bueneventura v CA

Spouses Buenaventura v CA
G.R. No. 126376, 20 November 2003
FACTS:
The defendants are Spouses Joaquin and their children Fidel, Tomas, Artemio, Clarita, Felicitas,
Fe and Gavino. Plaintiffs are children of the spouses namely Consolacion, Nora, Emma and
Natividad.
The plaintiffs sought to declare null and void deeds of sale executed by the Spouses Joaquin to
the defendant children. They claim that the deeds of sale should be void because they are
simulated due to the following:
a. There is no actual valid consideration for the deeds of sale
b. Even if there is consideration, the properties are three times more expensive compared to
the consideration in the deed
c. Deeds of sale do not reflect and express the true intent of the parties
d. Sale is a conspiracy designed to deprive the plaintiffs of their legitime
Due to their claims, the Registry of Deeds are deemed null and void
Defendants averred that
a. Plaintiffs do not have a cause of action against them and also the requisite standing and
interest to assail claim over the properties
b. Sales were with sufficient considerations and made by defendant parents and also
voluntary
c. Certificate of title were issued with sufficient factual and legal basis
RTC ruled in favor of the defendants because plaintiffs do not have a valid cause of action since
there is no legitime to speak prior the deaths of the parents. In determining legitime, value of the
property is considered at death of testator, legitime of heir is computed at the time of death of
parents. Plaintiffs cannot claim impairment of legitime while parents are alive
CA affirmed RTC decision. CA reasoned that the right to legitime is inchoate. While parents are
alive they are free to dispose of their property as long as it is not to defraud creditors.
ISSUES:
1. Whether or not the Court of Appeals erred in holding that conveyance had no valid
consideration
2. Whether or not the Court of Appeals erred in holding that even if there is
consideration, it is grossly inadequate
RULING:

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Martin, Michael Alexey D.R. Gross inadequacy of price
Sales / 2B Article 1470
Case Digest Spouses Bueneventura v CA

1. No. There is a valid consideration

-A contract of sale is a consensual contract. As a consensual contract becomes a binding and
valid upon meeting of the minds to price. If there is meeting of minds as to the price, the contract
of sale is valid, despite manner of payment, or even breach of manner of payment.
-Petitioners failed to show that the prices in the Deeds of Sale were absolutely simulated. The
trial court did not find the allegation of absolute simulation of price credible. Petitioners’ failure to
prove absolute simulation of price is magnified by their lack of knowledge of their respondent
siblings’ financial capacity to buy the questioned lots. On the other hand, the Deeds of Sale which
petitioners presented as evidence plainly showed the cost of each lot sold. Not only did
respondents’ minds meet as to the purchase price, but the real price was also stated in the Deeds
of Sale. As of the filing of the complaint, respondent siblings have also fully paid the price to their
respondent father.
2. The consideration is valid
-Article 1470 of Civil Code
Gross inadequacy of price does not affect a contract of sale, except as may indicate a defect in
the consent, or that the parties really intended a donation or some other act or contract There is
no requirement that the price be equal to the exact value of the subject matter of sale. Courts
used the case of Vales v. Villa: Courts cannot follow one every step of his life and extricate him
from bad bargains, protect him from unwise investments, relieve him from one-sided contracts,
or annul the effects of foolish acts. Courts cannot constitute themselves guardians of persons
who are not legally incompetent. Courts operate not because one person has been defeated or
overcome by another, but because he has been defeated or overcome illegally. Men may do
foolish things, make ridiculous contracts, use miserable judgment, and lose money by them
indeed, all they have in the world; but not for that alone can the law intervene and restore. There
must be, in addition, a violation of the law, the commission of what the law knows as an actionable
wrong, before the courts are authorized to lay hold of the situation and remedy it. Trial court found
that the lots were sold for a valid consideration, and that the defendant children actually paid the
purchase price stipulated in their respective Deeds of Sale. Actual payment of the purchase price
by the buyer to the seller is a factual finding that is now conclusive upon us
SC affirmed CA decision
DISPOSITION:
1. Deeds of sale are upheld

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