13.

SUPERCARS VS FLORES

G.R. No. 148173 December 10, 2004

FACTS

Flores purchased from Supercars an Isuzu Carter Crew Cab.

Upon delivery of the vehicle on Flores paid Supercars a 30% down payment plus insurance
premiums. The RCBC financed the balance of the purchase price. Its payment was secured by
a chattel mortgage of the same vehicle.

A day after the vehicle was delivered, Flores discovered that it has defects.

Despite several repairs, the defects resurfaced. This prompted Flores to return the car and
demand the rescission of the contract. Consequently, respondent stopped paying the monthly
amortization for the vehicle.

Because Flores stopped paying the monthly amortization RCBC filed a Petition for Extra-judicial
Foreclosure of Chattel Mortgage. An auction sale was conducted. RCBC, being the highest
bidder, purchased the vehicle. Subsequently, RCBC sold the vehicle to a third party.

Flores then filed a complaint5for rescission of contract with damages against petitioner, its sales
persons and RCBC.

RTC rendered its Decision in favor of respondent and against the defendants except for RCBC.

CA the RTC Decision with modification in the sense that the complaint against Supercars sales
men

Petitioner contends that respondent has "no right to rescind the contract of sale" because "the
motor vehicle in question, as found by the RTC and the Court of Appeals, is already in the
hands of a third party, one Mr. Lim an innocent purchaser for value."

ISSUE:

1. Whether or not petitioner can claim damages because of the breach of warranty against
hidden defects

HELD:

1. YES

Respondent's complaint filed with the RTC seeks to recover from petitioner the money he paid
for the vehicle due to the latter's breach of his warranty against hidden defects under Articles
1547, 1561,14 and 1566 of the Civil Code.

14 "Article 1561. The vendor shall be responsible for warranty against the hidden defects which
the thing sold may have, should they render it unfit for the use for which it is intended, or should
they diminish its fitness for such use to such an extent that, had the vendee been aware thereof,
he would not have acquired it or would have given a lower price for it; but said vendor shall not
be answerable for patent defects or those which may be visible, or for those which are not
visible if the vendee is an expert who, by reason of his trade or profession, should have known
them."

The vehicle, after it was delivered to respondent, malfunctioned despite repeated repairs by
petitioner. Obviously, the vehicle has hidden defects. A hidden defect is one which is unknown
or could not have been known to the vendee.
14. CHURCH OF CHRIST et. al. Vs. SPS. VALLESPIN

G.R. No. L-43726 August 15, 1988

GUYZZ HAAN TALAGA A RELATED DAYTUY TI SALES.

Article 1568. If the thing sold should be lost in consequence of the hidden faults, and the vendor
was aware of them, he shall bear the loss, and shall be obliged to return the price and refund
the expenses of the contract, with damages. If he was not aware of them, he shall only return
the price and interest thereon, and reimburse the expenses of the contract which the vendee
might have paid. (1487a)

FEELING KO KET JUST BECAUSE DOCKETED AS CIVIL CASE NO. 1568 DAYTUY AH
KASO. ISU LANG RELATION NA. HAHAHAHA.

FACTS:

Herein private respondents were allowed and permitted by church leaders to transfer an old
house from another lot to the lot in question and later in 1964, the old house was demolished
and the house now in litigation was erected, on the condition, that the same should be
considered as pastoral house of the congregation of the Church of Christ It was agreed that
their stay would be teaching and that they would vacate the premises when requested or
demanded by the leaders, elders or members. The contract was not in writing.

On September 10, 1973, the Church of Christ organized by Laureano N. Belo at Dadiangas was
registered with the Securities and Exchanged Commission.

Trouble apparently began when the group of Domingo H. Cruz was "disfellowshipped"
(expelled) for allegedly holding religious beliefs contrary to the belief of the Church of Christ
(Dadiangas of Dadiangas. Inc.).

The Church of Christ, Dadiangas Congregation, Inc., as registered with SEC, it became the
plaintiff in this case.

Demands were then made for the defendants to vacate the church lot. Private respondents
vigorously maintained that they occupied the lot in question because of the permission and
tolerance of the Church of Christ (N.T.), represented by Domingo H. Cruz, et al. and not by the
Church of Christ, Congregation) of Dadiangas represented by Laureano Belo. They alleged that
under the circumstances, the Church of Christ (N.T.), should have been included as a party
defendant by the petitioner (plaintiff therein).

The City Court rendered judgment in favor of the petitioner ordering the respondents to remove
their house and vacate the premises

On appeal to the Court of First Instance of South Cotabato (Branch I), the above decision was
reversed and the complaint as well as the counterclaim was dismissed.

ISSUE:
Whether or not two-paged complaint for ejectment should be disabling for failure to imposed,'
the Church of Christ (N.T.), as indispensable party.

HELD:

YES.

On February 7, 1969, the Church of Christ (N.T.), was incorporated and registered with the
Securities and Exchange Commission, while the Congregation of Dadiangas. Inc. was also
registered in the same Commission, but much later on September 10, 1973.

It is thus apparent that it was the Church of Christ before it was split in two factions that
negotiated with private respondents the terms and conditions of the unwritten agreement. The
disputed property is now being claimed by both.

Respondent court correctly ruled that the Church of Christ (N.T.), is an indispensable party
under Section 2 of Rule 3 of the Rules of Court, and should have been included as party
defendant, to resolve the issue of ownership which is intertwined with the issue of possession
(B.P. Blg. 129, 33, par. 20) respondent court erred in dismissing the complaint for failure to
include said church and in squarely placing the burden of procuring the presence of all
indispensable parties on the plaintiff (LASEDECO) Civil Case No. 1568; Rollo, p. 20)
15. CARLOS B. DE GUZMAN, vs. TOYOTA CUBAO

G.R. No. 141480 November 29, 2006

FACTS:

On 1997, petitioner purchased from respondent a brand new white Toyota Hi-Lux 2.4 SS double
cab motor vehicle. Petitioner made a down payment leaving a balance which was payable in 36
months with 54% interest. The vehicle was delivered to petitioner two days later. A year after,
petitioner demanded the replacement of the engine of the vehicle because it developed a crack
after traversing Marcos Highway during a heavy rain. Petitioner asserted that respondent should
replace the engine with a new one based on an implied warranty. Respondent countered that
the alleged damage on the engine was not covered by a warranty.

Petitioner filed a complaint for damages2 against respondent with the RTC.

Respondent moved to dismiss the case on the ground that under Article 1571 of the Civil Code,
the petitioners cause of action had prescribed as the case was filed more than six months from
the date the vehicle was sold and/or delivered.

RTC granted respondents motion and dismissed the complaint

Petitioner contends that the dismissal on the ground of prescription was erroneous because the
applicable provision is Article 169 of Republic Act No. and not Article 1571 of the Civil Code.

ISSUE: Whether or not the action has prescribed

HELD: YES

The pertinent provisions of the Civil Code set forth the available remedies of a buyer against the
seller on the basis of a warranty against hidden defects:

Art. 1571. Actions arising from the provisions of the preceding ten articles shall be barred after
six months from the delivery of the thing sold.

(Emphasis supplied)

Under Article 1599 of the Civil Code, once an express warranty is breached, the buyer can
accept or keep the goods and maintain an action against the seller for damages. In the absence
of an existing express warranty on the part of the respondent, as in this case, the allegations in
petitioners complaint for damages were clearly anchored on the enforcement of an implied
warranty against hidden defects, i.e., that the engine of the vehicle which respondent had sold
to him was not defective. By filing this case, petitioner wants to hold respondent responsible for
breach of implied warranty for having sold a vehicle with defective engine. Such being the case,
petitioner should have exercised this right within six months from the delivery of the thing
sold.7 Since petitioner filed the complaint on April 20, 1999, or more than nineteen months
counted from November 29, 1997 (the date of the delivery of the motor vehicle), his cause of
action had become time-barred.
16. SPS. NARVAEZ vs SPS. ALCISO

G.R. No. 165907 July 27, 2009

FACTS

Rose O. Alciso entered into a Deed of Sale with Right to Repurchase, 6 selling the property to
Sansano. Alciso later repurchased the property from Sansano and she entered into another
Deed of Absolute Sale,7 this time selling the property to Bate.

Bate entered into a Deed of Sale of Realty,10 selling the property to the spouses Dominador R.
Narvaez and Lilia W. Narvaez (Spouses Narvaez).

Alciso demanded that a stipulation be included in the Deed of Sale of Realty allowing her to
repurchase the property from the Spouses Narvaez. In compliance with Alcisos demand, the
Deed stated that, "The SELLER (Bate) carries over the manifested intent of the original SELLER
of the property (Alciso) to buy back the same at a price under such conditions as the present
BUYERS (Spouses Narvaez) may impose."

Alciso alleged that she informed the Spouses Narvaez that she wanted to repurchase the
property. The Spouses Narvaez demanded P300,000, but Alciso was willing to pay
only P150,000. Alciso and the Spouses Narvaez failed to reach an agreement on the
repurchase price.

Alciso filed a complaint with the RTC.

RTC ruled in favor of the respondents. It ruled, among others, that Deed of Sale of Realty
between Bate and Sps Narvaez contained a stipulation pour autrui in favor of Alciso Alciso
could repurchase the property.

Court of Appeals held that Bate and the Spouses Narvaez entered into a sale with right of
repurchase and that, applying Article 448 of the Civil Code, Alciso could either appropriate the
commercial building after payment of the indemnity or oblige the Spouses Narvaez to pay the
price of the land, unless the price was considerably more than that of the building.

ISSUE

Whether or not CA is correct in applying Art 448

HELD:

NO.

Article 1601 of the Civil Code states that, "Conventional redemption shall take place when the
vendor reserves the right to repurchase the thing sold, with the obligation to comply with the
provisions of Article 1616 and other stipulations which may have been agreed upon."

In a sale with right of repurchase, the applicable provisions are Articles 1606 and 1616 of the
Civil Code, not Article 448.

Articles 1606 states:

 Art. 1606. The right referred to in Article 1601, in the absence of an express agreement,
shall last four years from the date of the contract.lawph!l

Should there be an agreement, the period cannot exceed ten years.

However, the vendor may still exercise the right to repurchase within thirty days from the
time final judgment was rendered in a civil action on the basis that the contract was a true
sale with right to repurchase.

Under Article 1616, Alciso may exercise her right of redemption by paying the Spouses Narvaez
(1) the price of the sale, (2) the expenses of the contract, (3) legitimate payments made by
reason of the sale, and (4) the necessary and useful expenses made on the thing sold. In the
present case, the cost of the building constitutes a useful expense. Useful expenses include
improvements which augment the value of the land.28

Under the first paragraph of Article 1606, Alciso had four years from 14 August 1981 to
repurchase the property since there was no express agreement as to the period when the right
can be exercised. Tender of payment of the repurchase price is necessary in the exercise of the
right of redemption.

It is not sufficient for the vendor to intimate or to state to the vendee that the former desires to
redeem the thing sold, but he must immediately thereupon offer to repay the price. Alcisos
intimation to the Spouses Narvaez that she wanted to repurchase the property was insufficient.
To have effectively exercised her right of repurchase, Alciso should have tendered payment.

Nevertheless, under the third paragraph of Article 1606, Alciso has 30 days from the finality of
this Decision to exercise her right of repurchase.
17. ERLINDA GAJUDO vs. TRADERS ROYAL BANK,

G.R. No. 151098 March 21, 2006

FACTS

Petitioners filed a case against respondent, alleging among others that;

Petitioner] Danilo Chua obtained a loan from [respondent] bank secured by a real estate
mortgage over a parcel of land covered by TCT No. 16711, and owned in common by the
[petitioners];

that when the loan was not paid, [respondent] bank commenced extra-judicial foreclosure
proceedings on the property;

that on the scheduled auction sale, [the] Sheriff of Quezon City sold the property to the
[respondent] bank, the highest bidder therein;

that the other [petitioners] failed to redeem the property due to their lack of knowledge of their
right of redemption, and want of sufficient education;

that, although the period of redemption had long expired, [Petitioner] Chua offered to buy back,
and [respondent] bank also agreed to sell back, the foreclosed property, on the understanding
that Chua would pay [respondent] bank the amount representing the sum that the bank paid at
the auction sale, plus interest;

that [Petitioner] Chua made an initial payment thereon that, in a sudden change of position,
[respondent] bank wrote Chua, asking that he could repurchase the property, but based on the
current market value thereof; and

that sometime later, [respondent] bank wrote Chua anew, requiring him to tender a new offer to
counter the offer made thereon by another buyer.

Trial Court rendered the questioned partial decision., declaring respondent bank in default

The CA ruled in favor of respondent bank. CA ruled that petitioners failed to prove that the bank
had agreed to sell the property back to them.

Petitioners do not deny that the one-year period for legal redemption had already lapsed when
respondent bank supposedly offered to sell the property in question. Petitioners insist, though,
that they had the right to repurchase the property through conventional redemption, as provided
under Article 1601 of the Civil Code.

ISSUES

Whether or not the respondent appellate court failed to apply the conventional redemption rule
provided for under Article 1601 of the New Civil Code.

HELD

"ART. 1601. Conventional redemption shall take place when the vendor reserves the right to
repurchase the thing sold, with the obligation to comply with the provisions of Article 1616 and
other stipulations which may have been agreed upon."
It is true that the one-year period of redemption provided in Act No. 3135, as amended -- the law
under which the property here was sold in a foreclosure sale -- is only directory and, as such
can be extended by agreement of the parties.42

However, it has also been held that for legal redemption to be converted into conventional
redemption, two requisites must be established: 1) voluntary agreement of the parties to extend
the redemption period; and 2) the debtors commitment to pay the redemption price on a fixed
date.43

The letters sent by the bank to Petitioner Chua on February 20 and March 22, 1984, do not
convincingly show that the parties arrived at a firm agreement for the repurchase of the
property.

More important, there was no showing that petitioners had committed to pay the redemption
price on a fixed date. The documents presented by Chua were still unable to establish a firm
commitment on their part to pay the redemption price on a fixed date.

In sum, petitioners have failed to convince this Court of the cogency of their position,
notwithstanding the advantage they enjoyed in presenting their evidence ex parte. Not in every
case of default by the defendant is the complainant entitled to win automatically.
18. PHIL-VILLE VS BONIFACIO
GR NO. 167391; JUNE 8, 2011

FACTS:

Phil-Ville Development and Housing Corporation is the registered owner of three parcels of land
designated as Lots 1-G-1, 1-G-2 and 1-G-3 located in Caloocan City. Prior to their subdivision,
the lots were collectively designated as Lot 1-G registered in the name of Phil-Ville under TCT
No. T-148220.[9] Said parcels of land form part of the Maysilo Estate.

Earlier, on September 27, 1961, a group composed of Eleuteria Rivera, et. al. claiming to be the
heirs of Maria de la Concepcion Vidal, a co-owner of the properties of the Hacienda Maysilo,
filed a petition with the Court of First Instance (CFI) of Rizal. They prayed for the substitution of
their names on OCT No. 994 in place of Maria de la Concepcion Vidal. Said petition was
granted by the CFI.

On May 22, 1996, upon motion of Eleuteria, portions of the properties covered by OCT No. 994
were segregated and partitioned.

Meanwhile, a writ of possession[16] was issued in Eleuteria Rivera. Accordingly, Sheriff Cesar L.
Cruz served a Notice to Vacate[18] upon Phil-Ville, requiring it to vacate Lots 23-A and 28.

Petitioner filed a complaint for quieting of title and damages against the surviving heirs of
Eleuteria Rivera Vda. de Bonifacio et. al. and the Register of Deeds of Caloocan City.

The Caloocan RTC ordered the quieting of Phil-Villes titles over Lots 1-G-1, 1-G-2 and 1-G-3.

Court of Appeals promulgated its assailed Decision setting aside the RTC judgment and
dismissing Phil-Villes complaint. The appellate court held that the RTC had no jurisdiction to
hear Phil-Villes complaint

ISSUE

Whether or not Petitioners title to the subject properties are valid. (Guyzz more on quieting of
title ken declaratory relief met tuy issues ti case. Naisingit lang jay Art. 1607)

HELD:

Petitioner was well aware that the lots encompassed by its titles are not the same as that
covered by respondents title.

This brings petitioners action within the purview of Rule 63 of the Rules of Court on Declaratory
Relief. Section 1 of Rule 63 provides in part:
 SECTION 1. Who may file petition.-xxxxxx

An action for the reformation of an instrument, to quiet title to real

property or remove clouds therefrom, or to consolidate ownership under
Article 1607 of the Civil Code, may be brought under this Rule. (Emphasis
supplied).

Article 1607. In case of real property, the consolidation of ownership in the vendee by
virtue of the failure of the vendor to comply with the provisions of article 1616 shall not
be recorded in the Registry of Property without a judicial order, after the vendor has
been duly heard. (n)

Article 1616. The vendor cannot avail himself of the right of repurchase without
returning to the vendee the price of the sale, and in addition:
(1) The expenses of the contract, and any other legitimate payments made by reason
of the sale;
(2) The necessary and useful expenses made on the thing sold.(Italics by Aprille;
Inayun ko lang guys; for reference lang.)

An action for declaratory relief presupposes that there has been no actual breach of the
instruments involved or of the rights arising thereunder.

While petitioner was not able to demonstrate that respondents TCT No. C-314537 in the
name of Eleuteria Rivera constitutes a cloud over its title, it has nevertheless successfully
established its ownership over the subject properties and the validity of its titles which entitles it
to declaratory relief.

WHEREFORE, the petition for review on certiorari is GRANTED.