PAPA VS VALENCIAFacts:Sometime in June 1982, A.U. Valencia and Co., Inc. and Felix Pearroyo, filed with the Regional Trial Court of Pasig, Branch 151, a complaint for specific performance against Myron C. Papa, in his capacity as administrator of the Testate Estate of one Angela M. Butte. The complaint alleged that Papa, acting as attorney-in-fact of Angela M. Butte, sold to Pearroyo, through Valencia, a parcel of land.Prior to the alleged sale, the said property had been mortgaged by her to the Associated Banking Corporation. After the alleged sale to Valencia and Penarroyo, but before the title to the subject property had been released, Butte passed away. Despite representations made by Valencia to the bank to release the title to the property sold to Pearroyo, the bank refused to release it unless and until all the mortgaged properties of the late Butte were also redeemed.In order to protect his rights and interests over the property, Pearroyo caused the annotation on the title of an adverse claim.Sometime in April 1977, that Valencia and Pearroyo discovered that the mortgage rights of the bank had been assigned to Tomas L. Parpana, as special administrator of the Estate of Ramon Papa. Jr. Since then, Papa had been collecting monthly rentals in the amount of P800.00 from the tenants of the property, knowing that said property had already been sold to Valencia and Pearroyo. Despite repeated demands from said respondents, Papa refused and failed to deliver the title to the property.Valencia and Pearroyo prayed that Papa be ordered to deliver to Pearroyo the title to the subject propertyRTC rendered a decision, allowing Papa to redeem from the Reyes spouses, who bought the land at a public auction because of tax delinquency and ordering Papa to execute a Deed of Absolute Sale in favor of Pearroyo.Papas defense: The sale was never consummated as he did not encash the check (in the amount of P40,000.00) given by Valencia and Pearroyo in payment of the full purchase price of the subject lot. He maintained that what Valencia and Pearroyo had actually paid was only the amount of P5,000.00 (in cash) as earnest money.Issue: Was there valid payment although Papa failed to encash the check?

Held:Yes. Valencia and Pearroyo had given Papa the amounts of P5,000.00 in cash on 24 May 1973, and P40,000.00 in check on 15 June 1973, in payment of the purchase price of the subject lot. Papa himself admits having received said amounts, and having issued receipts therefor. Papas assertion that he never encashed the aforesaid check is not substantiated and is at odds with his statement in his answer that he can no longer recall the transaction which is supposed to have happened 10 years ago.After more than 10 years from the payment in part by cash and in part by check, the presumption is that the check had been encashed. Granting that Papa had never encashed the check, his failure to do so for more than 10 years undoubtedly resulted in the impairment of the check through his unreasonable and unexplained delay.While it is true that the delivery of a check produces the effect of payment only when it is cashed, pursuant to Article 1249 of the Civil Code, the rule is otherwise if the debtor is prejudiced by the creditors unreasonable delay in presentment. The acceptance of a check implies an undertaking of due diligence in presenting it for payment, and if he from whom it is received sustains loss by want of such diligence, it will be held to operate as actual payment of the debt or obligation for which it was given.If no presentment is made at all, the drawer cannot be held liable irrespective of loss or injury unless presentment is otherwise excused. This is in harmony with Article 1249 of the Civil Code under which payment by way of check or other negotiable instrument is conditioned on its being cashed, except when through the fault of the creditor, the instrument is impaired. The payee of a check would be a creditor under this provision and if its non-payment is caused by his negligence, payment will be deemed effected and the obligation for which the check was given as conditional payment will be discharged.Considering that Valencia and Pearroyo had fulfilled their part of the contract of sale by delivering the payment of the purchase price, they, therefore, had the right to compel Papa to deliver to them the owners duplicate of TCT 28993 of Angela M. Butte and the peaceful possession and enjoyment of the lot in question.

Sycip vs. CA

Facts:-Francisco Sycip agreed to buy, on installment, from Francel Realty Corporation (FRC), a townhouse unit. Upon execution of the contract to sell, Sycip, as required issued to FRC 48 postdated checks, each on the amount of P9,304 covering 48 monthly instalments. After moving in his unit, Sycip complained to FRC regarding defects in the unit and incomplete features of the townhouse project. FRC ignored the complaint. Sycip served on FRC 2 notarial notices to the effect that he was suspending his installment payments on the unit pending compliance with the project plans and specifications, as approved by the Housing and Land Use Regulatory Board HLURB).Notwithstanding the notarial notices, FRC continued to present for encashment Sycips postdated checks in its possession. Sycip sent stop payment orders to the bank.The bank (Citibank) advised Sycip to close his checking account to avoid paying bank charges evry time he made a stop payment order. Due to the closure of petitioners checking account, the drawee bank dishonoured six postdated checks. FRC filed a complaint against petitioner for violations of BP Blg 22 involving said dishonored checks. RTC and CA found petitioner guilty of violating Sec 1 of BP Blg 22 in each of the six cases.Issue:w/n the CA erred in affirming the conviction of petitioner for violation of the Bouncing Checks Law.Held:Petitioners exercise of a right of the buyer under Article 23 of PD 957 is a valid defense to the charges against him. Petition is granted. Petitioner is ACQUITTED of the charges against him under BP Blg. 22.

RD:-We find that although the first element of the offense exists, the other elements have not been established beyond reasonable doubt.Under the provisions of BP Blg 22, an offense is committed when the following elements are present: (1) the making, drawing and issuance of any check to apply for account or for value; (2) the knowledge of the maker, drawer, or issuer that at the time of issue he does not have sufficient funds in or credit with the drawee bank for the payment of such check in full upon its presentment; and (3) the subsequent dishonour of the check by the drawee bank for insufficiency of funds or credit or dishonor for the same reason had not the drawer, without any valid cause, ordered the bank to stop payment.We find from the records no showing that at the time said checks were issued, petitioner had knowledge that his deposit or credit in the bank would be insufficient to cover them when presented for encashment.We are of the view that petitioner had a valid cause to order his bank to stop payment. The third element of subsequent dishonour of the checkwithout valid cause appear to us not established by the prosecution.Following Article 11 (5) of the RPC, petitoners exercise of a right of the buyer under Art 23 of PD 957 is a valid defense to charges against him.Sec 23 of PD 957: The buyer of a townhouse unit has the right to suspend his amortization payments, should the subdivision or condominium developer fail to develop or complete the project in accordance with duly approved plans and specifications.