CONTRACT OF SALE:

 According to the Civil Code of the Philippines, Contract of Sale is a contract

whereby one of the contracting parties obligates himself to transfer the
ownership of and to deliver a determinate thing, and the other to pay therefor a
price certain in money or its equivalent.
 Essential Requisites: (a) Consent or meeting of the minds, that is, consent to
transfer ownership in exchange for the price; (2) Determinate subject matter; and
(3) Price certain in money or its equivalent.
 The meeting of the minds is to transfer the ownership
of the determinate subject matter.
 Ownership is already transferred upon the execution of deed of absolute sale.

CONTRACT TO SELL:

 The ownership is transferred upon the fulfillment of the suspensive

condition, then they will enter the deed of absolute sale. (There is a promise to
pay and sell)
 Ownership is retained by the seller until the suspensive condition is fulfilled by
the buyer.
 The meeting of the minds is not to immediately transfer the ownership of
the determinate thing upon execution of contract.
 The agreement is for the prospective seller to transfer the title/ownership of the
determinate subject matter to the buyer upon the full payment of purchase price
(suspensive condition).

Coronel v. CA Buyer in bad faith: If a vendee in a double sale registers that sale after
he has acquired knowledge that there was a previous sale of the same property to a
third party or that another person claims said property in a pervious sale, the registration
will constitute a registration in bad faith and will not confer upon him any right.
Case of double sale: Art. 1544. If the same thing should have been sold to different vendees, the
ownership shall be transferred to the person who may have first taken possession thereof in good faith,
if it should be movable property.

Should if be immovable property, the ownership shall belong to the person acquiring it who in good faith
first recorded it in Registry of Property.

Should there be no inscription, the ownership shall pertain to the person who in good faith was first in
the possession; and, in the absence thereof to the person who presents the oldest title, provided there is
good faith

CORONEL V. COURT OF APPEALS

 In a contract to sell, the prospective seller explicitly reserves the transfer of title to
the prospective buyer, meaning, the prospective seller does not as yet agree or
consent to transfer ownership of the property subject of the contract to sell until
the happening of an event, which for present purposes we shall take as the full
payment of the purchase price. What the seller agrees or obliges himself to do is
to fulfill his promise to sell the subject property when the entire amount of the
purchase price is delivered to him. In other words, the full payment of the
purchase price partakes of a suspensive condition, the non-fulfillment of which
prevents the obligation to sell from arising and thus, ownership is retained by the
prospective seller without further remedies by the prospective buyer.
 What is the nature of the contract entered by the parties? A conditional
contract of sale. The agreement could not have been a contract to sell because
the sellers herein made no express reservation of ownership or title to the subject
parcel of land. Furthermore, the circumstance which prevented the parties from
entering into an absolute contract of sale pertained to the sellers themselves (the
certificate of title was not in their names) and not the full payment of the purchase
price. Petitioners in the case at bar did not merely promise to sell the properly to
private respondent upon the fulfillment of the suspensive condition. On the
contrary, having already agreed to sell the subject property, they undertook to
have the certificate of title changed to their names and immediately thereafter, to
execute the written deed of absolute sale.

Petitioners had already agreed to sell the house and lot they inherited from their
father, completely willing to transfer full ownership of the subject house and lot to
the buyer if the documents were then in order. As soon as the new certificate of
title is issued in their names, petitioners were committed to immediately execute
the deed of absolute sale. Only then will the obligation of the buyer to pay the
remainder of the purchase price arise.

 How did the Supreme Court interpret the nature of “Receipt of Down Payment?”

What is clearly established by the plain language of the subject document is that
when the said “Receipt of Down Payment” was prepared and signed by
petitioners Romeo A. Coronel, et al., the parties had agreed to a conditional
contract of sale, consummation of which is subject only to the successful transfer
of the certificate of title from the name of petitioners’ father, Constancio P.
Coronel, to their names.

Petitioners-sellers undertook upon receipt of the down payment from private

respondent Ramona P. Alcaraz, to cause the issuance of a new certificate of title
in their names from that of their father, after which, they promised to present said
title, now in their names, to the latter and to execute the deed of absolute sale
whereupon, the latter shall, in turn, pay the entire balance of the purchase price.

 What is a contract of sale subject to a suspensive condition? Differentiate it with

Contract to Sell.

 Contract to Sell: In a contract to sell, the prospective seller explicity reserves

the transfer of title to the prospective buyer, meaning, the prospective seller
does not as yet agree or consent to transfer ownership of the property subject
of the contract to sell until the happening of an event, which for present
purposes we shall take as the full payment of the purchase price. What the
seller agrees or obliges himself to do is to fulfill is promise to sell the subject
property when the entire amount of the purchase price is delivered to him. In
other words the full payment of the purchase price partakes of a suspensive
condition, the non-fulfillment of which prevents the obligation to sell from
arising and thus, ownership is retained by the prospective seller without
further remedies by the prospective buyer.
 Contract of Sale subject to a suspensive condition: In a conditional
contract of sale, however, upon the fulfillment of the suspensive condition, the
sale becomes absolute and this will definitely affect the seller's title thereto. In
fact, if there had been previous delivery of the subject property, the seller's
ownership or title to the property is automatically transferred to the buyer such
that, the seller will no longer have any title to transfer to any third person.
 Applying Article 1544 of the Civil Code, such second buyer of the property
who may have had actual or constructive knowledge of such defect in the
seller's title, or at least was charged with the obligation to discover such
defect, cannot be a registrant in good faith. Such second buyer cannot defeat
the first buyer's title. In case a title is issued to the second buyer, the first
buyer may seek reconveyance of the property subject of the sale.

ROQUE V. LAPUZ

 A contract to sell may thus be defined as a bilateral contract whereby the

prospective seller, while expressly reserving the ownership of the subject
property despite delivery thereof to the prospective buyer, binds himself to sell
the said property exclusively to the prospective buyer upon fulfillment of the
condition agreed upon, that is, full payment of the purchase price.
 Is it essential to distinguish the nature of the contract to determine the effect of
the sale of the same property to a third person.
 The distinction between contracts of sale and contracts to sell with reserved title
has been recognized by this Court in repeated decisions upholding the power of
promisors under contracts to sell in case of failure of the other party to complete
payment, to extrajudicially terminate the operation of the contract, refuse
conveyance and retain the sums or installments already received, where such
rights are expressly provided for.

 What was the nature of the contract entered into by the parties?
The contract between the petitioner and the respondent was a contract to sell
where the ownership or title is retained by the seller and is not to pass until the
full payment of the price, such payment being a positive suspensive condition
and failure of which is not a breach, casual or serious, but simply an event that
prevented the obligation of the vendor to convey title from acquiring binding
force.

In the case at bar, there is no writing or document evidencing the agreement

originally entered into between petitioner and private respondent except the
receipt showing the initial deposit of P150.00 as shown in Exh. "A" and the
payment of the 4- months installment made by respondent. This absence of a
formal deed of conveyance is a very strong indication that the parties did
not intend immediate transfer of ownership and title, but only a transfer
after full payment of the price

The standard printed contracts for the sale of the lots in the Rockville Subdivision
on a monthly installment basis showing the terms and conditions thereof are
immaterial to the case at bar since they have not been signed by either of the
parties to this case.

 Is the immediate possession of the property after payment of installment an

indicia that the parties entered into a contract of sale? No, the agreement entered
into by and between petitioner and respondent Lapuz was a mere promise to sell
or contract to sell, under which title to the lots in question did not pass from
petitioner to respondent. The absence of a formal deed of conveyance is a
very strong indication that the parties did not intend immediate transfer of
ownership and title, but only a transfer after full payment of the price
 What is the prospective seller’s remedy in case the prospective buyer
defaulted in paying the installments in a contract to sell?
 Seller may reimburse in case he elects to rescind the contract by reason of the
buyer’s default or deliberate refusal to pay or continue paying the purchase price
of the land.

Since this is so conceded, then the right of the petitioner to rescind the
agreement upon the happening or in the event that respondent fails or defaults in
any of the monthly installments would be rendered nugatory and ineffective. The
right of rescission would then depend upon an extraneous consideration
which the law does not contemplate.

"a slight or casual breach of contract is not a ground for rescission. It must be so
substantial and fundamental to defeat the object of the parties"

PHHC V. CA
 A contract to sell as defined hereinabove, may not even be considered as a
conditional contract of sale where the seller may likewise reserve title to the
property subject of the sale until the fulfillment of a suspensive condition,
because in a conditional contract of sale, the first element of consent is present,
although it is conditioned upon the happening of a contingent event which may or
may not occur. If the suspensive condition is not fulfilled, the perfection of the
contract of sale is completely abated.

 Student Work: Is there a perfected sale to the Mendoza when Lot 4 was awarded
to them? No, the sale was not perfected. The sale was conditionally awarded
tothe spouses subject to the approval of the city council (of the subdivision plans)
and the approval of the award by the valuation committee and higher authorities.
The city council did not approve the subdivision plan. The Men-doza spouses
were made aware through mail. The spouses should have manifested in wiriting
their acceptance of the award of the purchase pf Lot 4just to show they were
interested although the lot had been reduced in terms of area.
Under the facts, we cannot say there was a meeting of the mind on the renewed
area of Lot 4 since the spouses did not manifest acceptance on their part.
 What do you understand by “Lot Award?” Is it a contract or a privilege or a grant?
A contract because it is stipulated that the Mendozas never paid the price of the
lot nor made the 20% initial deposit and The five awardees made the initial
deposit. The corresponding deeds of sale were executed in their favor. The
subdivision of Lot 4 into five lots was approved by the city council and the Bureau
of Lands.
 What was the condition stated in the Award? The awardees were required to
deposit an amount equivalent to 20% of the total selling price

 What was the effect of disapproval of the subdivision plan? Another subdivision
plan was prepared and submitted to the city council for approval.