Group: 3 Day: Tuesday and Friday

Subject: Law on Obligations and Contracts Time: 4:30 PM-6:30 PM

ANG YU ASUNCION v. COURT OF APPEALS G.R. No. 109125, EN BANC, December 2,

1994, VITUG J.
Facts:
On July 29, 1987, a Second Amended Complaint for Specific Performance was filed by Ang Yu
Asuncion and Keh Tiong, et al., against Bobby Cu Unjieng and Jose Tan before the Regional
Trial Court of Manila.The plaintiffs were tenants or lessees of residential and commercial spaces
owned by defendants in Binondo, Manila. On several conditions defendants informed the
plaintiffs that they are offering to sell the premises and are giving them priority to acquire the
same. During negotiations, Bobby Cu Unjieng offered a price of P6-million while plaintiffs made
a counter of offer of P5-million. Plaintiff thereafter asked the defendants to put their offer in
writing to which the defendants acceded. In reply to defendants’ letter, plaintiffs wrote, asking
that they specify the terms and conditions of the offer to sell. When the plaintiffs did not receive
any reply, they sent another letter with the same request.Since defendants failed to specify the
terms and conditions of the offer to sell and because of information received that the
defendants were about to sell the property, plaintiffs were compelled to file the complaint to
compel defendants to sell the property to them. The court dismissed the complaint on the
ground that the parties did not agree upon the terms and conditions of the proposed sale,
hence, there was no contact of sale at all.

On November 15, 1990, the Cu Unjieng spouses executed a Deed of Sale transferring the
property in question to Buen Realty and Development Corporation. Buen Realty, as the new
owner of the subject property, wrote to the lessees demanding the latter to vacate the premises.
In its reply, it stated that Buen Realty and Development Corporation brought the property
subject to the notice of lis pendens.
Issue:
Whether the plaintiff can compel defendants to execute the necessary Deed of Sale of the
property in litigation in favor of the plaintiffs who has a right of first refusal

Ruling:
NO, The final judgment in in favor to the plaintiff was merely a “right of first refusal”. The
consequence of such a declaration entails no more than what has heretofore been said. In fine,
if, as it is here so conveyed to us, petitioners are aggrieved by the failure of private respondents
to honor the right of first refusal, the remedy is not a writ of execution on the judgment, since
there is none to execute, but an action for damages in a proper forum for the purpose.
 CARMELITA LEAÑO v. COURT OF APPEALS G.R. No. 129018 November 15, 2001,
PARDO, J.

FACTS:
Hermogenes Fernando and Carmelita Leaño executed a contract to sell a parcel of land called
Lot No. 876-B, which has a 431 square meter area and is situated at Sto. Bulacan, Cristo, and
Baliuag, on November 13, 1985. Carmelita Leaño committed herself in the contract to paying
Hermogenes Fernando the complete purchase price of the property of one hundred seven
thousand, seven hundred fifty pesos (P107,750.00). The contract further stipulated that
payments must be made within a grace period of one month in addition to the month of grace. If
the grace period ends without both months' installments being paid, an 18% annual interest fee
will be added to the balance owed. Should a period of ninety (90) days pass after the grace
period has ended without the past-due and unpaid installments and the associated interest have
been paid, respondent Fernando, as vendor, was authorized to declare the contract canceled
and to dispose of the parcel of land, as if the contract had not been entered into.

Carmelita Leaño made her last payment on April 1st, 1989. On September 16, 1991, the trial
court issued a ruling in an ejectment action that respondent Fernando had previously filed,
ordering petitioner Leaño to leave the property and pay. Occupation of the property from May
27, 1991, until she left the property, as well as the lawyer's expenses and court costs. The trial
court issued a writ of execution on August 24, 1993, and petitioner Leaño was duly served with
it. Petitioner Leaño submitted a case for specific performance with a preliminary injunction to the
Regional Trial Court of Malolos, Bulacan, on September 27, 1993. On November 4, 1993,
petitioner Leaño posted a P50,000 cash bond. The trial court made a decision on February 6,
1995. Respondent Fernando submitted a request for reconsideration and its supplemental
documents on February 21, 1995. On January 22, 1997, the Court of Appeals issued a ruling
that unanimously upheld the Regional Trial Court's judgment. A move for reconsideration was
submitted by petitioner Leao on February 11th, 1997. The Court of Appeals rejected the motion
on April 18, 1997.
ISSUES:
I. Whether the parties engaged in an absolute sale or a conditional sale;
II. Whether the purchase agreement was properly canceled; and
III. Whether the petitioner was behind on the monthly amortizations.

RULING:
The court ruled that the transaction between the parties was a conditional sale, not an absolute
sale. because the intention of the parties was to reserve ownership of the land for the seller until
the buyer had paid the total purchase price.
The court ruled Article 1592 of the Civil Code is inapplicable to the case at bar, where petitioner
Leano’s non-payment of the installments after April 1, 1989, prevented the obligation of
respondent Fernando to convey the property from arising.
The court ruled that while the contract provided that the total purchase price was payable within
a ten-year period, the same contract specified that the purchase price shall be paid in monthly
installments, for which the corresponding penalty shall be imposed in case of default. Petitioner
Leano's cannot ignore the provision on the payment of monthly installments by claiming that the
ten-year period within which to pay has not elapsed. So petitioner Leano's will update her
accounts with respondent Fernando in accordance with the statement of account, which
amounts to P183,687.00.