G.R. NO.

L-42283 MARCH 18, 1985

BUENAVENTURA ANGELES, ET. AL., plaintiffs-appellees,

vs.
URSULA TORRES CALASANZ, ET. AL., defendants-appellants.

FACTS:

On December 19, 1957, defendants-appellants Ursula Torres Calasanz and Tomas

Calasanz and plaintiffs-appellees Buenaventura Angeles and Teofila Juani entered into a
contract to sell a piece of land located in Cainta, Rizal for th e amount of P3,920.00
plu s 7%interest per annum. The plaintiffs-appellees made a down payment of P392.00
upon th e e x e c u ti o n o f th e c o n tr a c t. Th e y p r o m i s e d to p a y th e b a l an ce
i n m o n th l y installments of P41.20 until fully paid, due and payable on the19th day of
each month. The plaintiffs-appellees paid the monthly installments until July 1966,
when their aggregate payment already amounted to P4,533.38.

On D e c e m b e r 7 , 1 9 6 6 , th e d e f e n d a n ts - a p p e l la n ts r e q u e s te d the
remittance of past du e accounts. On January 28,1967, th e defendants-appellants
can celled th e said contract because the plaintiffs f a il ed to m e e t th e s u b sequ en t
p a y m e n ts . Th e p l a i n ti ffs ’ p l e a f o r reconsideration of the said cancellation was
denied by the defendants.

As such, Plaintiffs-appellees filed a case before the Court of First Instance of Rizal to
compel the defendant to execute in their favor the final deed of sale alleging that after
computing all subsequent payments for the land, they found out that they have already
paid the total amount including interests, realty taxes and incidental expenses.
Conversely, defendants alleged in their answer that the plaintiffs-appellees violated par.
6 of the contract to sell wh en th ey failed an d refu sed to pay an d/or offer to pay
mon thly in stallments c o r r e sp on ding to th e m o n th o f A u g u st, 1 9 6 6 f o r m ore
th a n 5 m o n th s , th e r e b y constraining the defendants to cancel the said contract.
The Court of First Instance rendered judgment in favor of the plaintiffs-appellees.
Hence the instant appeal.

ISSUE:

W h e th e r o r n o t th e C o n tr a c t to S e l l h a s b e e n a u to m a ti c a l l y a n d v a l i dly
c a n c e l l e d b y th e defendants-appellants.

RULING:

No, the contract to sell was not automatically and validly cancelled by the defendants-
appellants. Article 1191 provides, that in reciprocal obligations, either party has the right
to rescind the contract upon the failure of the other to perform the obligation assumed
thereunder. Moreover, there is nothing in the law that prohibits the parties from entering
into an agreement that violation of the terms of the contract would cause its cancellation
even without court intervention. However, the right to rescin d the contract for non-
performance of one of its stipulations, is not absolute. In Universal Food Corp. v. Court of
Appeals (33 SCRA 1) the Court stated that the general rule is that rescission of a contract
will not be permitted for a slight or casual breach, but only for such substantial and
fundamental breach as would defeat the very object of the parties in making the
agreement. Whether a breach of a contract is substantial depends upon the attendant
circumstances.

In this case, the Court held that the breach of the contract adverted to by the defendants-
appellants is so slight and casual. Plaintiffs-appellees have already paid an aggregate
amount of P4,533.38 and they had already paid the monthly installments for a period of
almost nine (9) years. In other words, in only a short time, the entire obligation would have
been paid. To sanction the rescission made by the defendants-appellants will work
injustice to the plaintiffs- appellees.

Therefore, upon payment of the balance of P671.67 without any interest thereon, the
defendants-appellants must immediately execute the final deed of sale in favor of the
plaintiffs-appellees and execute the necessary transfer documents as provided in
paragraph 12 of the contract. The attorney's fees are justified.

Hence, the petition was DENIED for lack of merit by the Supreme Court and the decision
appealed from is AFFIRMED with the modification that the plaintiffs-appellees should pay
the balance of SIX HUNDRED SEVENTY ONE PESOS AND SIXTY-SEVEN CENTAVOS
(P671.67) without any interests. Costs against the defendants-appellants