Coronel v. CA263 SCRA 15

Facts: Romulo Coronel executed a document entitled “Receipt of Downpayment” in favor of Ramona Patricia Alcaraz for P50,000 downpayment of the amount of P1.24M as purchase price for an inherited house and lot, without reservation to withhold the transfer of such property until full payment. The purpose of such downpayment was for the heirs to transfer the title to their name. Upon the registration of the property to name of the heirs, the Coronels sold the same property to Catalina B. Mabanag for P1.58M. The Coronels rescinded the contract with Alcaraz by depositing the downpayment amount in a bank account in favor of Alcaraz. Alcaraz filed a complaint for specific performance, which the trial and the appellate court ruled in her favor.

Issue: Whether the “receipt of downpayment” serves a contract to sell or a conditional contract of sale.

Held: The agreement is a contract of sale as there was no express reservation of ownership or title to the subject parcel of land. Petitioners did not merely promise to sell the property to private respondent upon the fulfillment of the suspensive condition but 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. The suspensive condition was fulfilled on 6 February 1985 and thus, the conditional contract of sale between the parties became obligatory, the only act required for the consummation thereof being the delivery of the property by means of the execution of the deed of absolute sale in a public instrument, which petitioners unequivocally committed themselves to do as evidenced by the “Receipt of Down Payment.”

Romero v. CA250 SCRA 15

Facts: Virgilio Romero and his foreign partners decided to put up a central warehouse in Metro Manila. Alfonso Flores, in behalf of Enriqueta Chua vda. De Ongsiong, proposed the latter’s lot to Romero as the site for the said warehouse. A contract denominated as “Deed of Conditional Sale” was executed between Romero and Ongsiong where the amount of P50,000 was received from Romero for the purpose of taking up am ejectment case against the squatters found therein. Ongsiong sought to return the amount she received from Romero as she claimed she is unable to rid the land of squatters, notwithstanding the favorable judgment already promulgated by the court in the ejectment case. Romero’s counsel refused the tender and expressed willingness to underwrite the expense of executing the judgment chargeable to the purchase price of the land. Ongsiong filed a case with the trial court for the rescission of the deed of “conditional” sale, and for the consignation of the amount of P50,000. The trial court rendered a decision in favor of Romero, which was reversed by the Court of Appeals.

Issue: Whether the “Deed of Conditional Sale” is a perfected contract of sale

Held: The deed of sale, even if denominated as a deed of conditional sale, may be treated as absolute in nature, especially if title to the property sold is not reserved in the vendor or if the vendor is not granted the right to unilaterally rescind the contract predicated on the fulfillment or non-fulfillment of the prescribed condition. In determining the real character of contract, the substance and not the title given by the party is more significant. Upon perfection, i.e. where the seller obligates himself, for a price certain, to deliver and to transfer ownership of a specific thing or right to the buyer over which the latter agrees, the parties are bound not only to the fulfillment of what was expressly stipulated but also the consequences which may be in keeping with good faith, usage and law. Being a perfected contract of sale, no rescission can be had. The proper action is an action for damages. Arguendo that rescission is available as a remedy, as provide by Article 1191 in reciprocal obligations, it may only be availed of by the injured party.