5.

TAYAG v CA  It was proven, however, that first payment of P3k was received by Galicia
GR NO. 96053 Sr. Although, the second payment was only in the amount of P9,707 and
March 3, 1993 was contrary to what was stipulated, which was P10k.
By: Gayares  Additionally, the assumption of Galicia’s obligation to PVB was not
Topic: Extinguishment of obligations; payment or performance; application of completely satisfied since Leyva only paid the sum of P6,926.41 out of the
payment; payment by cession; tender and consignation full P10k amount. The full amount of the remaining P27k balance was
Petitioners: Josefina Tayag, Ricardo Galicia, Teresita Galicia, Evelyn Galicia, Juan also left unpaid.
Galica, Jr., and Rodrigo Galicia  Due to the reasons stated, the heirs of Juan Galicia, Sr. are rescinding the
Respondents: Court of Appeals and Albrigido Leyva contract inked by their predecessor.
Ponente: Melo, J.  RTC: Upholds Leyva’s theory on the basis of constructive fulfillment under
Art. 1186 and estoppel through acceptance of piecemeal payments in line
RECIT-READY/SUMMARY: Leyva purchased a lot from Galicia. There are four with Art. 1235. Acceptance by the petitioners of the various payments
conditions in the purchase contract. Petitioners alleged that Leyva did not pay even beyond the periods agreed upon was perceived as tantamount to
conditions 2 – 4. Multiple pieces of evidence show that Leyva paid everything and faithful performance of the obligation. Additionally, Levya consigned
that the contentions of the petitioners are all wrong. Leyva is entitled to the P18,520, which is an amount sufficient to offset the remaining balance.
property. Petitioners must execute the deed of sale to Leyva.
 CA: Affirmed RTC’s decision with modifications to the consigned
payment.
DOCTRINE:
The right to rescind is not absolute and will not be granted where there has been
ISSUE:
substantial compliance by partial payments.
W/N payments had in fact been made by Leyva to the heirs of Juan Galicia Sr.?
FACTS:
HELD/RATIO:
 The subject matter is a deed of conveyance executed by Juan Galicia Sr.
YES – No doubt that the second installment of payment was paid to the heirs. This
and Celerina Labuguin in favor of Albrigido Leyva involving the undivided
was proven by Josefina Tayag’s admission in judicio that the sum of P10k was fully
one-half portion of a piece of land situated at Nueva Ecija for the sum of
liquidated. It is erroneous for petitioners to suppose that the evidence does not
P 50k subject to the following terms:
support this conclusion.
1. P3k is acknowledge to have been paid during the execution of
the agreement;
As for the third payment of the contract, CA applied Art. 1186 of the Civil Code on
2. P10k shall be paid within ten days from and after the execution
constructive fulfillment. The contention of the petitioners that this article shouldn’t
of the agreement;
have been appreciated because they are the obligees is wrong. They must concede
3. P10k represents the vendors’ indebtedness with the Philippine
to the fact that in a reciprocal obligation like a contract of purchase, both parties
Veterans Bank (PVB) which is hereby assumed by the vendee;
are mutually obligors and obligees and any of the contracting parties may rescind
and
the contract or seek fulfillment. The petitioners are also bound as obligors to
4. The balance of P27k shall be paid within one year from and
respect the stipulation in permitting private respondent to assume the loan with
after the execution of this agreement.
the PVB, which they impeded when they paid the balance of the loan.
 The heirs of Juan Galicia Sr. alleged that Leyva’s claim anchored on full
payment and compliance with the stipulations in the agreement cannot
As for the last payment, petitioners argue that there was no valid tender of
be granted due to a breach of contract by the latter.
payment nor consignation of P18,520. This is also wrong. Consignation alone
 Leyvaa filed in the court a suit for specific performance by the heirs but
produced the effect of payment in this case since the evidence shows that two or
the court ruled against him.
more heirs of Galicia claimed the right to collect. Furthermore, petitioners did not
bother to refute the evidence that Leyva paid more than the actual amount due. He
paid a total of P28,649.48 when he only owed P27,000.00. He overpaid by an
amount of P1,649,98 and he is entitled for the refund of the said amount. Hence,
the fourth condition in their contract is fully satisfied.

WHEREFORE, the petition is dismissed and the decision appealed is affirmed with
slight modifications to the fourth condition of the agreement.