G.R. No.

L-11231 May 12, 1958

ROSARIO CARBONNEL, plaintiff-appellant, vs. JOSE PONCIO, RAMON INFANTE, and EMMA
INFANTE, defendants-appellees.
Tolentino and Garcia and D. R. Cruz for appellant.
Guillermo B. Guevarra, Ricardo P. Guevarra and Emmanuel S. Tipon for appellees.
CONCEPCION, J.:
The issue in this case is whether the Statute of Frauds is applicable thereto.
Plaintiff Rosario Carbonnel alleges, in her second amended complaint, filed with the Court of First Instance
of Rizal, that, on January 27, 1955, she purchased from defendant Jose Poncio, at P9.50 a square meter,
a parcel of land of about 195 square meters, more or less, located in San Juan del Monte, Rizal, known as
Lot No. 13-B of subdivision plan Psd-19567, and more particularly described in Transfer Certificate of Title
No. 5040 (now No. 37842), excluding the improvements thereon; that plaintiff paid P247.26 on account
of the price and assumed Poncio's obligation with the Republic Savings Bank amounting to P1,177.48, with
the understanding that the balance would be payable upon execution of the corresponding deed of
conveyance; that one of the conditions of the sale was that Poncio would continue staying in said land for
one year, as stated in a document signed by him (and later marked as Exhibit A), a translation of which
was attached to the said complaint: that Poncio refuses to execute the corresponding deed of sale, despite
repeated demand; that plaintiff has thereby suffered damages in the sum of P5,000, aside from attorney's
fees amounting to P1,000; that Poncio has conveyed the same property to defendants Ramon R. Infante
and Emma L. Infante, who knew, of the first sale to plaintiff; and that the Infantes had thereby, caused
damages to plaintiff in the sum of P5,000.
Plaintiff prayed, therefore, that she be declared owner of the land in question; that the sale to the Infantes
be annulled; that Poncio be required to execute the corresponding deed of conveyance in plaintiff's favor;
that the Register of Deeds of Rizal be directed to issue the corresponding title in plaintiff's name; and that
defendants be sentenced to pay damages.
Defendants moved to dismiss said complaint upon the ground that plaintiff's claim is unenforceable under
the Statute of Frauds, and that said pleading does not state facts sufficient to constitute a cause of action.
The motion was denied, "without prejudice to considering, when this case is decided on the merits,
whether the same falls under the Statute of Frauds."
Thereafter, the Infantes filed an answer denying, most of the allegations of said complaint and alleged, by
way of special defense, that they purchased the land in question in good faith, for value, and without
knowledge of the alleged sale to plaintiff; and that plaintiff's claim is unenforceable under the Statute of
Frauds. They, likewise, set up counterclaims for damages.
In his answer, Poncio denied specifically some allegations of said complaint and alleged that he had no
knowledge sufficient to form a belief as to the truth of the other averments therein. By way of special
defenses, he alleged that he had consistently turned down several offers, made by plaintiff, to buy the
land in question, at P15 a square meter, for he believes that it is worth not less than P20 a square meter;
that Mrs. Infante, likewise, tried to buy the land at P15 a square meter; that, on or about January 27, 1955,
Poncio was advised by plaintiff that should she decide to buy the property at P20 a square meter, she
would allow him to remain in the property for one year; that plaintiff then induced Poncio to sign a
document, copy of which is probable, the one appended to the second amended complaint; that Poncio
signed it "relying upon the statement of the plaintiff that the document was a permit for him to remain in
the premises in the event that defendant decided to sell the property to the plaintiff at P20 a square
meter"; that on January 30, 1955, Mrs. Infante improved her offer and he agreed to sell the land and its
improvements to her for P3,535; that Poncio has not lost "his mind," to sell his property, worth at least
P4,000, for the paltry sum of P1,177.48, the amount of his obligation to the Republic Savings Bank; and
that plaintiff's action is barred by the Statute of Frauds. Poncio similarly set up a counterclaim for
damages.
As the case came up for trial on February 23, 1956 plaintiff introduced the testimony of one Constancio
Meonada, who said that he is janitor of the Sto. Domingo Church and a high school, as well as auto-
mechanic, graduate; that he has been and still is a paying boarder in plaintiff's house; that Poncio is his
townmate, both being from Mahatao, Batanes; that, after making a rough draft, based upon data
furnished by plaintiff, he typed Exhibit A, which is, in the Batanes dialect; that, thereafter, Poncio came to
plaintiff's house, where he was shown Exhibit A; that after the witness had read its contents to Poncio
and given him a copy thereof, Poncio signed Exhibit A and so did the plaintiff; that Meonada likewise
signed at the foot of Exhibit A, as attesting witness; and that translated freely into English, Exhibit A, reads
as follows:
From this date, January 27, Jose Poncio may stay in this lot that I bought from him until one year without
payment. After that one year and he cannot find any place where to transfer his house, he can also stay
in this lot and he will pay according agreement. (t.s.n., p. 4.)
Then, taking the witness stand, plaintiff testified that she has known Poncio since childhood, he being
related to her mother; that Poncio's lot adjoins her lot, in San Juan, Rizal; that one day Poncio told her
that he wanted to sell his property; that, after both had agreed on its price, he said that his lot is
mortgaged to the Republic savings Bank; and that at noon time, on the same day, he came back stating
that both would "go to the bank to pay the balance in arrears." At this juncture, defense counsel moved
to strike out the statement of the witness, invoking, in support of the motion, the Statute of Frauds. After
an extended discussion, the parties agreed to submit memoranda and the hearing was suspended. Later
on, the lower court issued an order dismissing plaintiff's complaint, without costs, upon the ground that
her cause of action is unenforceable under the Statute of Frauds. The counterclaims were, also, dismissed.
Hence, this appeal by plaintiff.
We are of the opinion and so hold that the appeal is well taken. It is well settled in this jurisdiction that
the Statute of Frauds is applicable only to executory contracts (Facturan vs. Sabanal, 81 Phil., 512), not to
contracts that are totally or partially performed (Almirol, et al., vs. Monserrat, 48 Phil., 67, 70; Robles vs.
Lizarraga Hermanos, 50 Phil., 387; Diana vs. Macalibo, 74 Phil., 70).
Subject to a rule to the contrary followed in a few jurisdictions, it is the accepted view that part
performance of a parol contract for the sale of real estate has the effect, subject to certain conditions
concerning the nature and extent of the acts constituting performance and the right to equitable relief
generally, of taking such contract from the operation of the statute of frauds, so that chancery may decree
its specific performance or grant other equitable relief. It is well settled in Great Britain and in this country,
with the exception of a few states, that a sufficient part performance by the purchaser under a parol
contract for the sale of real estate removes the contract from the operation of the statute of frauds. (49
Am. Jur. 722-723.)
In the words of former Chief Justice Moran: "The reason is simple. In executory contracts there is a wide
field for fraud because unless they be in writing there is no palpable evidence of the intention of the
contracting parties. The statute has precisely been enacted to prevent fraud." (Comments on the Rules of
Court, by Moran, Vol. III [1957 ed.], p. 178.) However, if a contract has been totally or partially
performed, the exclusion of parol evidence would promote fraud or bad faith, for it would enable the
defendant to keep the benefits already denied by him from the transaction in litigation, and, at the same
time, evade the obligations, responsibilities or liabilities assumed or contracted by him thereby.
For obvious reasons, it is not enough for a party to allege partial performance in order to hold that there
has been such performance and to render a decision declaring that the Statute of Frauds is inapplicable.
But neither is such party required to establish such partial performance by documentary proof before he
could have the opportunity to introduce oral testimony on the transaction. Indeed, such oral testimony
would usually be unnecessary if there were documents proving partial performance. Thus, the rejection
of any and all testimonial evidence on partial performance, would nullify the rule that the Statute of
Frauds is inapplicable to contracts which have been partly executed, and lead to the very evils that the
statute seeks to prevent.
The true basis of the doctrine of part performance according to the overwhelming weight of authority, is
that it would be a fraud upon the plaintiff if the defendant were permitted to escape performance of his
part of the oral agreement after he has permitted the plaintiff to perform in reliance upon the agreement.
The oral contract is enforced in harmony with the principle that courts of equity will not allow the statute
of frauds to be used as an instrument of fraud. In other words, the doctrine of part performance was
established for the same purpose for which, the statute of frauds itself was enacted, namely, for the
prevention of fraud, and arose from the necessity of preventing the statute from becoming an agent of
fraud for it could not have been the intention of the statue to enable any party to commit a fraud with
impunity. (49 Am. Jur., 725-726; emphasis supplied.)
When the party concerned has pleaded partial performance, such party is entitled to a reasonable chance
to; establish by parol evidence the truth of this allegation, as well as the contract itself. "The recognition
of the exceptional effect of part performance in taking an oral contract out of the statute of frauds involves
the principle that oral evidence is admissible in such cases to prove both the contract and the part
performance of the contract" (49 Am. Jur., 927).
Upon submission of the case for decision on the merits, the Court should determine whether said
allegation is true, bearing in mind that parol evidence is easier to concoct and more likely to be colored
or inaccurate than documentary evidence. If the evidence of record fails to prove clearly that there has
been partial performance, then the Court should apply the Statute of Frauds, if the cause of action
involved falls within the purview thereof. If the Court is, however, convinced that the obligation in
question has been partly executed and that the allegation of partial performance was not resorted to as
a devise to circumvent the Statute, then the same should not be applied.
Apart from the foregoing, there are in the case at bar several circumstances indicating that plaintiff's claim
might not be entirely devoid of factual basis. Thus, for instance, Poncio admitted in his answer that
plaintiff had offered several times to purchase his land.
Again, there is Exhibit A, as document signed by the defendant. It is in the Batanes dialect, which,
according to plaintiff's uncontradicted evidence, is the one spoken by, Poncio, he being a native of said
region. Exhibit A states that Poncio would stay in the land sold by him to plaintiff for one year, from
January 27, 1955, free of charge, and that, if he cannot find a place where to transfer his house thereon,
he may remain in said lot under such terms as may be agreed upon. Incidentally, the allegation in Poncio's
answer to the effect that he signed Exhibit A under the belief that it "was a permit for him to remain in
the premises in the event" that "he decided to sell the property" to the plaintiff at P20 a sq. m." is, on its
face, somewhat difficult to believe. Indeed, if he had not decided as yet to sell the land to plaintiff, who,
had never increased her offer of P15 a square meter, there was no reason for Poncio to get said, Permit
from her. Upon the other hand, if plaintiff intended to mislead Poncio, she would have caused Exhibit A
to be drafted, probably in English, instead of taking the trouble of seeing to it that it was written precisely
in his native dialect, the Batanes. Moreover, Poncio's signature on Exhibit A suggests that he is neither
illiterate nor so ignorant as to sign a document without reading its contents, apart from the fact that
Meonada had read Exhibit A to him and given him a copy thereof, before he signed thereon, according to
Meonada's uncontradicted testimony.
Then, also, defendants say in their brief:
The only allegation in plaintiff's complaint that bears any relation to her claim that there has been partial
performance of the supposed contract of sale, is the notation of the sum of P247.26 in the bank book of
defendant Jose Poncio. The noting or jotting down of the sum of P247.26 in the bank book of Jose Poncio
does not prove the fact that said amount was the purchase price of the property in question. For all we
knew, the sum of P247.26 which plaintiff claims to have paid to the Republic Savings Bank for the account
of the defendant, assuming that the money paid to the, Republic Savings Bank came from the plaintiff,
was the result of some usurious loan or accommodation, rather than earnest money or part payment of
the land. Neither is a competent or satisfactory evidence to prove the conveyance on the land in question
the fact that the bank book account of Jose Poncio happens to be in the possession of the plaintiff.
(Defendants-Appellees' brief, pp. 25-26.)
How shall we know why Poncio's bank deposit book is in plaintiff's possession or whether there is any
relation between the P247.26 entry therein and the partial payment of P247.26 allegedly made by plaintiff
to Poncio on account of the price of his land, if we do not allow the plaintiff to explain it on the witness
stand? Without expressing any opinion on the merits of plaintiff's claim, it is clear, therefore, that she is
entitled, legally as well as from the viewpoint of equity, to an opportunity to introduce parol evidence in
support of the allegations of her second amended complaint.
Wherefore, the order appealed from is hereby set aside, and let this case be remanded to the lower court
for further proceedings not inconsistent with this decision, with the costs of this instance against
defendants-appellees. It is so ordered.
G.R. No. L-16480 January 31, 1962
ARTEMIO KATIGBAK, petitioner, vs. COURT OF APPEALS, DANIEL EVANGELISTA and V. K.
LUNDBERG, respondents.
Benjamin J. Molina for petitioner.
Jesus B. Santos for respondent V. K. Lundberg.
Ledesma, Puno, Guytingco, Antonio and Associates for respondent Daniel Evangelista.
PAREDES, J.:
This case arose from an agreed purchase and sale of a Double Drum Carco Tractor Winch. Artemio
Katigbak upon reading an advertisement for the sale of the winch placed by V. K. Lundberg, owner and
operator of the International Tractor and Equipment Co., Ltd., went to see Lundberg and inspected the
equipment. The price quoted was P12,000.00. Desiring a reduction of the price, Katigbak was referred to
Daniel Evangelista, the owner. After the meeting, it was agreed that Katigbak was to purchase the winch
for P12,000.00, payable at P5,000.00 upon delivery and the balance of P7,000.00 within 60 days. The
condition of the sale was that the winch would be delivered in good condition. Katigbak was apprised that
the winch needed some repairs, which could be done in the shop of Lundberg. It was then stipulated that
the amount necessary for the repairs will be advanced by Katigbak but deductible from the initial payment
of P5,000.00. The repairs were undertaken and the total of P2,029.85 for spare parts was advanced by
Katigbak for the purpose. For one reason or another, the sale was not consummated and Katigbak sued
Evangelista, Lundberg and the latter's company, for the refund of such amount.
Lundberg and Evangelista filed separate Answers to the complaint, the former alleging non-liability for
the amount since the same (obligation for refund) was purely a personal account between defendant
Evangelista and plaintiff Katigbak. Lundberg asked P500.00 by way of actual and compensatory damages
and P5,000.00 as moral damages, claiming that the filing of the suit was malicious; that there is a
misjoinder because he is a stranger in the case, not being a party to the agreement between Evangelista
and Katigbak.
Evangelista, on his part, claimed that while there was an agreement between him and Katigbak for the
purchase and sale of the winch and that Katigbak advanced the payment for the spare parts, he (Katigbak)
refused to comply with his contract to purchase the same; that as a result of such refusal he (Evangelista)
was forced to sell the same to a third person for only P10,000.00, thus incurring a loss of P2,000.00, which
amount Katigbak should be ordered to pay, plus moral damages of P5,000.00 and P700.00 for attorney's
fees.
The lower court rendered judgment, the dispositive portion of which reads - .
WHEREFORE, judgment is hereby rendered ordering the defendants Daniel Evangelista and V. K. Lundberg
to pay plaintiff the sum of P2,029.85, with legal interest thereon from the filing of the complaint until fully
paid, plus the sum of P300.00 as attorney's fees, and the costs." .
The Court of Appeals, on September 5, 1959, reversed the judgment in the following manner:
Notwithstanding the breach of contract committed by him, we may concede appellee's right to a refund
of the sum of P2,029.85, but equally undeniable is appellant Evangelista's right to recover from him his
loss of P2,000.00, which is the difference between the contract price for the sale of the winch between
him and appellee and the actual price for which it was sold after the latter had refused to carry out his
agreement. As held in the above-cited case of Hanlon, if the purchaser fails to take delivery and pay the
purchase price of the subject matter of the contract, the vendor, without the need of first rescinding the
contract judicially, is entitled to resell the same, and if he is obliged to sell it for less than the contract
price, the buyer is liable for the difference. This loss, which is the subject matter of Evangelista's main
counterclaim, should therefore be set off against the sum claimed by appellee, which would leave in favor
of the latter a balance of P29.85.
Considering our finding that it was appellee who committed a breach of contract, it follows that the
present action was unjustified and he must be held liable to appellant Evangelista for attorney's fees in
the sum of P700.00.
Lastly, inasmuch as, according to the evidence appellant Lundberg was merely an agent of his co-
appellant, it is obvious that he cannot be held liable to appellee in connection with the refund of the sum
advanced by the latter.1wph1.t
WHEREFORE, the appealed judgment is hereby modified by dismissing the complaint as to V. K. Lundberg;
by reducing the judgment in favor of appellee to the sum of P29.85, and by sentencing him, in turn, to pay
appellant Evangelista the sum of P700.00 as attorney's fees".
Plaintiff-appellee Katigbak brought the matter to this Court on appeal by certiorari. In his petition he
claims that the Court of Appeals erroneously applied the doctrine enunciated in the Hanlon v. Hausserman
case (40 Phil. 796, 815-816), and failed to apply the law relative to rescission of contracts. Other issues
raised are strictly factual and will only be mentioned here for reference.
We quote from the Hanlon case:
.... In the present case the contract between Hanlon and the mining company was executory as to both
parties, and the obligation of the company to deliver the shares could not arise until Hanlon should pay
or tender payment of the money. The situation is similar to that which arises every day in business
transactions in which the purchaser of goods upon an executory contract fails to take delivery and pay the
purchase price. The vendor in such case is entitled to resell the goods. If he is obliged to sell for less than
the contract price, he holds the buyer for the difference; if he sells for as much as or more than the
contract price, the breach of contract by the original buyer is damnum absque injuria. But it has never
been held that there is any need of an action of rescission to authorize the vendor, who is still in
possession, to dispose of the property where the buyer fails to pay the price and take delivery... (40 Phil.
815) .
The facts of the case under consideration are identical to those of the Hanlon case. The herein petitioner
failed to take delivery of the winch, subject matter of the contract and such failure or breach was,
according to the Court of Appeals, attributable to him, a fact which We are bound to accept under existing
jurisprudence. The right to resell the equipment, therefore, cannot be disputed. It was also found by the
Court of Appeals that in the subsequent sale of the winch to a third party, the vendor thereof lost
P2,000.00, the sale having been only for P10,000.00, instead of P12,000.00 as agreed upon, said difference
to be borne by the supposed vendee who failed to take delivery and/or to pay the price.
Of course, petitioner tried to draw a distinction between the Hanlon case and his case. The slight
differences in the facts noted by petitioner are not, however, to our mode of thinking, sufficient to take
away the case at bar from the application of the doctrine enunciated in the Hanlon case.
WHEREFORE, the petition is dismissed, and the decision appealed from is affirmed in all respects, with
cost against petitioner.

G.R. No. 76031 March 2, 1994

MIGUEL SEMIRA, petitioner, vs. COURT OF APPEALS and BUENAVENTURA AN, respondents.
Antonio M. Chavez for petitioner.
Onofre K. Quizon for private respondent.
BELLOSILLO, J.:
Juana Gutierrez owned a parcel of land, later designated as Lot 4221, situated in Sto. Nio, Taysan,
Batangas which she sold to private respondent Buenaventura An for P850.00 by means of a "Kasulatan ng
Bilihan ng Lupa" executed on 4 January 1961.1 Aside from the estimated area of 822.5 square meters
appearing in the deed of sale, the following boundaries of the lot are also stated: on the north, by Taysan-
Lobo-Sto. Nio-Pinagbayanan and Sto. Nio-Dagatan Road (Junction or Intersection road); on the east, by
Sto. Nio-Pinagbayanan Road and Juana Gutierrez; on the south, by Sto. Nio School site; and, on the
west, by Sto. Nio-Dagatan Road.
Thereafter, private respondent entered the premises observing thereby the boundaries of the property
and not the area given.2
Subsequently, he acquired two (2) other parcels of land, Lot 4215 with an area of 8,606-square meters
located on the east of Lot 4221 from the spouses Pascual Hornilla and Gliceria Ilao on 30 June 1964, and
another lot with an area of 11,000-square meters from Santiago Asi. Pascual Hornilla is the son of Juana
Gutierrez.
On 18 October 1972, private respondent sold Lot 4221 to his nephew, Cipriano Ramirez, and spouse by
means of another "Kasulatan ng Bilihan ng Lupa" for P2,500.00,3 where the lot was described with the
same area and boundaries mentioned in the 4 January 1961 "Kasulatan ng Bilihan ng Lupa" with the
exception of the boundary on the east; which was changed from "Juana Gutierrez" to "Buenaventura An"
to reflect the acquisition by private respondent of the adjoining Lot 4215.
Like his uncle before him, Cipriano Ramirez occupied the lot by observing the boundaries stated in the
document of sale. Subsequently, he applied for a new tax declaration to replace the one in the name of
his uncle but was denied in view of an existing mortgage executed by Buenaventura An in favor of the
Taysan Rural Bank, which was only settled in 1979.
On 12 March 1979, Cipriano Ramirez sold the lot to petitioner Miguel Semira for P20,000.00. However,
the area stated in the "Kasulatan ng Bilihan ng Lupa"4 was 2,200 square meters and not 822.5 appearing
in the previous document. As delimited by its boundaries, the lot is actually much bigger than 822.5 square
meters. This was confirmed by the Taysan Cadastral Mapping Survey conducted in 1974 where it is
definitely stated that the area of Lot 4221 is 2,200 square meters; hence, the reason for the change.
On 17 March 1979, Miguel Semira entered the very same premises previously occupied by Ramirez and
began the construction of a new rice-mill. However, on 18 April 1979, a complaint for forcible entry was
filed against him by private respondent in the Municipal Circuit Trial Court of Taysan-Lobo.5 The latter
claimed that the area of Lot 4221 was 822.5 square meters only and that the excess of 1,377 square
meters forcibly occupied by petitioner formed part of Lot 4215 which he acquired from the Hornillas in
1964.
Petitioner admits having entered the disputed portion on 17 March 1979, but denies having illegally done
so. In his answer, petitioner claims ownership over the property by invoking the 1979 deed of sale in his
favor by Cipriano Ramirez.
Meanwhile, during the pendency of the case, private respondent applied for and was issued original
Certificate of Title No. P-12694 over the lots he purchased from the Hornillas and that from Santiago Asi
with a combined area of 19,606 square meters. However, the title was issued for 2 hectares, 8 ares and
33 centares or 20,833 square meters. No explanation was given for the difference.
The case was initially dismissed for lack of jurisdiction.6 The municipal court of Taysan-Lobo ruled that
since the issue of prior physical possession could not be resolved without first deciding on the ownership,
dismissal was proper since forcible entry cases involve the sole issue of prior physical possession.
However, upon motion, and in view of the passage of B.P. Blg. 129, which took effect 14 August 1981,
providing that "[m]etropolitan trial courts, municipal trial courts, and municipal circuit trial courts, without
distinction, may try cases of forcible entry and detainer even if the question of ownership is raised in the
pleadings and possession could not be resolved without deciding the ownership," 7 the trial court
modified its earlier resolution and adjudged petitioner the rightful and lawful owner and possessor of the
area in question and cannot therefore be ejected therefrom.8
Private respondent appealed to the Regional Trial Court which reversed the Municipal Circuit Trial Court,
ruling that it was not necessary to delve on the issue of ownership since the question of prior physical
possession could be resolved independently, and that since petitioner admitted having possessed the
disputed area on 12 March 1979 while the possession of private respondent began way back in 1964, the
latter clearly had prior possession. 9 Since petitioner did not specifically deny the allegation of forcible
deprivation of property in his Answer, the averment in that regard was deemed admitted under Sec. 1,
Rule 9, of the Rules of Court. 10 As a final word, the RTC held that "no matter how righteous defendant's
claim of ownership over the property may be, he has not the right to take the law into his own hands by
forcibly depriving plaintiff of his prior actual possession of the property." 11
Petitioner appealed to the Court of Appeals, but without success. 12 In its Decision of 22 April 1986,
respondent appellate court dismissed the petition for review and affirmed the RTC decision in toto. 13
Petitioner contends that the Court of Appeals erred: (1) in upholding this ejectment from the disputed
area despite the absence of clear and indubitable proof that private respondent had prior physical
possession and that he was deprived of the same by force, intimidation, strategy or stealth; and, (2) in not
holding that the question of ownership is so necessarily involved that it would be impossible to decide the
question of bare possession without first setting that of ownership. 14
We agree with the position of petitioner and sustain the Municipal Circuit Trial Court in holding that in
the case at bench the issue of possession cannot be decide independently of the question of ownership.
Hence, we reverse the Court of Appeals as well as the Regional Trial Court.
In his complaint in the MCTC, private respondent claims constructive possession of the disputed portion
since 30 June 1964 when he bought the same as part of Lot 4215 of the Hornilla spouses. Likewise,
petitioner bases his occupancy of the disputed portion on the 1979 sale of Lot 4221 in his favor, which he
contends is separate and distinct from Lot 4215 of private respondent. Clearly, the question of who has
prior possession hinges on the question of who the real owner of the disputed portion is. And the latter,
in turn, depends on whether such portion is part of Lot 4215 of private respondent or of Lot 4221 of
petitioner.
It is not disputed that Lot 4221 of petitioner was once owned by private respondent; that the latter sold
the same to his nephew, Cipriano Ramirez, in 1972 for the lump sum of P2,500.00; that the "Kasulatan ng
Bilihan ng Lupa" incorporated both the estimated area and the definite boundaries of the land; and, that
private respondent's nephew in turn sold the lot to petitioner in 1979 with the very same boundaries
mentioned in the deed of sale executed in his favor by his uncle Buenaventura An.
Petitioner claims that owns the entire 2,200 square meters since it is the size of Lot 4221 following its
established boundaries. On the other hand, private respondent insists that he only sold 822.5 square
meters, hence, his nephew could not have transferred a bigger area to petitioner.
We sustain petitioner as did the Municipal Circuit Trial Court. We have repeatedly ruled that where land
is sold for a lump sum and not so much per unit of measure or number, the boundaries of the land stated
in the contract determine the effects and scope of the sale, not the area thereof. 15 Hence, the vendors
are obligated to deliver all the land included within the boundaries, regardless of whether the real area
should be greater or smaller than that recited in the deed. This is particularly true where the area is
described as "humigit kumulang," that is, more or less. 16 These conclusions are drawn from Art. 1542 of
the Civil code which states
In the sale of real estate, made for a lump sum and not at the rate of a certain sum for a unit of measure
or number, there shall be no increase or decrease of the price, although there be a greater or less are or
number than that stated in the contract.
The same rule shall be applied when two or more immovables are sold for a single price; but if, besides
mentioning the boundaries, which is indispensable in every conveyance of real estate, its area or number
should be designated in the contract, the vendor shall be bound to deliver all that is included within said
boundaries, even when it exceeds the area or number specified in the contract; and, should he not be able
to do so, he shall suffer a reduction in the price, in proportion to what is lacking in the area or number,
unless the contract is rescinded because the vendee does not accede to the failure to deliver what has
been stipulated.
Hence, when private respondent Buenaventura An sold Lot 4221 to his nephew Cipriano Ramirez by
means of a "Kasulatan ng Bilihan ng Lupa" which incorporated both the area and the definite boundaries
of the lot, the former transferred not merely the 822.5 square meters stated in their document of sale but
the entire area circumscribed within its boundaries.
The fact that the area turned out to be 2,200 square meters; instead of only 822.5 square meters, is of no
moment and does not entitle private respondent to the difference because the definite object sold was
Lot 4221 in its entirety and not just any unit of measure or number. 17 That the sale resulted in a
disadvantage to private respondent does not confer on him any cause of action against petitioner. 18
Besides, we are hardly convinced that Buenaventura An entered into the sale unaware that Lot 4221
actually had a much bigger area than it purported to be. Even as early as the sale between him and his
nephew, private respondent was already aware of the difference between the stated area of Lot 4221
and its actual size. His nephew Cipriano Ramirez testified, and private respondent did not dispute, that
when asked why the area of Lot 4221 stated in their deed of sale was much smaller than the actual size,
private respondent explained that it was to minimize taxes. 19 Private respondent likewise did not deny
that his nephew merely transferred to petitioner the very same area which he himself had acquired and
possessed in 1961 when he bought the same from Juana Gutierrez, the original owner of the lot.
Considering the foregoing, it is not difficult to sustain petitioner over private respondent when the latter
failed even to prove prior possession in his favor. Absent such element, it cannot be said that he was
forcibly deprived of the disputed portion. Hence, his action for forcible entry must fail.
It should be emphasized, however, that the case before us is merely an action for forcible entry and that
the issue of ownership was decided for the sole purpose of resolving priority of possession. Hence, any
pronouncement made affecting ownership of the disputed portion is to be regarded merely as provisional,
hence, does not bar nor prejudice an action between the same parties involving title to the land. 20
WHEREFORE, the Decision of the Intermediate Appellate Court (now Court of Appeals) dated 22 April 1986
affirming that of the Regional Trial Court of 13 January 1984 in toto is REVERSED and SET ASIDE and
another one entered REINSTATING, AFFIRMING and REITERATING the Decision of 4 May 1983 of the
Municipal Circuit Trial Court of Taysan-Lobo, Batangas, with costs against private respondent
Buenaventura An.
SO ORDERED.

G.R. No. 109410 August 28, 1996

CLARA M. BALATBAT, petitioner, vs. COURT OF APPEALS and Spouses JOSE REPUYAN and AURORA
REPUYAN, respondents.
TORRES, JR. , J.:p
Petitioner Clara M. Balatbat instituted this petition for review pursuant to Rule 45 of the Revised Rules of
Court seeking to set aside the decision dated August 12, 1992 of the respondent Court of Appeals in CA-
GR. CV No. 29994 entitled "Alexandra Balatbat and Clara Balatbat, plaintiffs-appellants versus Jose
Repuyan and Aurora Repuyan, defendants-appellees", the dispositive portion of which reads: 1
WHEREFORE, the judgment appealed from is affirmed with the modification that the awards of
P10,000.00 for attorney's fees and P5,000.00 as costs of litigation are deleted.
SO ORDERED.
The records show the following factual antecedents:
It appears that on June 15, 1977, Aurelio A. Roque filed a complaint for partition docketed as Civil Case
No. 109032 against Corazon Roque, Alberto de los Santos, Feliciano Roque, Severa Roque and Osmundo
Roque before the then Court of First Instance of Manila, Branch IX. 2 Defendants therein were declared in
default and plaintiff presented evidence ex-parte. On March 29, 1979, the trial court rendered a decision
in favor of plaintiff Aurelio A. Roque, the pertinent portion of which reads: 3
From the evidence, it has been clearly established that the lot in question covered by Transfer Certificate
of Title No. 51330 was acquired by plaintiff Aurelio Rogue and Maria Mesina during their conjugal union
and the house constructed thereon was likewise built during their marital union. Out of their union,
plaintiff and Maria Mesina had four children, who are the defendants in this case. When Maria Mesina
died on August 28, 1966, the only conjugal properties left are the house and lot above stated of which
plaintiff herein, as the legal spouse, is entitled to one-half share pro-indiviso thereof. With respect to the
one-half share pro-indiviso now forming the estate of Maria Mesina, plaintiff and the four children, the
defendants here, are each entitled to one-fifth (1/5) share pro-indiviso. The deceased wife left no debt.
Wherefore, judgment is hereby rendered ordering the partition of the properties, subject matter of this
case consisting of the house and lot, in the following manner:
1. Of the house and lot forming the conjugal properties, plaintiff is entitled to one-half share pro-
indiviso thereof while the other half forms the estate of the deceased Maria Mesina;
2. Of the Estate of deceased Maria Mesina, the same is to be divided into five (5) shares and plaintiff and
his four children are entitled each to one-fifth share thereof pro-indiviso.
Plaintiff claim for moral, exemplary and actual damages and attorney's fees not having been established
to the satisfaction of the Court, the same is hereby denied.
Without pronouncement as to costs.
SO ORDERED
On June 2, 1979, the decision became final and executory. The corresponding entry of judgment was made
on March 29, 1979. 4
On October 5, 1979, the Register of Deeds of Manila issued a Transfer Certificate of Title No. 135671 in
the name of the following persons in the following proportions: 5
Aurelio A. Roque 6/10 share
Severina M. Roque 1/10 share
Osmundo M. Roque 1/10 share
Feliciano M. Roque 1/10 share
Corazon M. Roque 1/10 share
On April 1, 1980, Aurelio A. Rogue sold his 6/10 share in T.C.T. No. 135671 to spouses Aurora Tuazon-
Repuyan and Jose Repuyan as evidenced by ."Deed of Absolute Sale." 6
On July 21, 1980, Aurora Tuazon Repuyan caused the annotation of her affidavit of adverse claim 7 on the
Transfer Certificate of Title No. 135671, 8 to wit:
Entry No. 5627/T-135671 NOTICE OF ADVERSE CLAIM Filed by Aurora Tuazon Repuyan, married,
claiming among others that she bought 6/10 portion of the property herein described from Aurelio Roque
for the amount of P50,000.00 with a down payment of P5,000.00 and the balance of P45,000.00 to be
paid after the partition and subdivision of the property herein described, other claims set forth in Doc.
No. 954, page 18, Book 94 of ________________ 64 _______ PEDRO DE CASTRO, Notary Public of Manila.
Date of instrument July 21, 1980
Date of inscription July 21, 1980 at 3:35 p.m.
TERESITA H. NOBLEJAS
Acting Register of Deeds
By:
RAMON D. MACARICAN
Acting Second Deputy
On August 20, 1980, Aurelio A. Roque filed a complaint for "Rescission of Contract" docketed as Civil Case
No. 134131 against spouses Aurora Tuazon-Repuyan and Jose Repuyan before Branch IV of the then Court
of First Instance of Manila. The complaint is grounded on spouses Repuyan's failure to pay the balance of
P45,000.00 of the purchase price. 9 On September 5, 1980, spouses Repuyan filed their answer with
counterclaim. 10
In the meantime, the trial court issued an order in Civil Case No. 109032 (Partition case) dated February
2, 1982, to wit: 11
In view of all the foregoing and finding that the amount of P100,000.00 as purchase price for the sale of
the parcel of land covered by TCT No. 51330 of the Registry of Deeds of Manila consisting of 84 square
meters situated in Callejon Sulu, District of Santa Cruz, Manila, to be reasonable and fair, and considering
the opportunities given defendants to sign the deed of absolute sale voluntarily, the Court has no
alternative but to order, as it hereby orders, the Deputy Clerk of this Court to sign the deed of absolute
sale for and in behalf of defendants pursuant to Sec. 10, Rule 39 of the Rules of Court, in order to effect
the partition of the property involved in this case.
SO ORDERED.
A deed of absolute sale was executed on February 4, 1982 between Aurelio S. Roque, Corazon Roque,
Feliciano Roque, Severa Roque and Osmundo Roque and Clara Balatbat, married to Alejandro
Balatbat. 12On April 14, 1982, Clara Balatbat filed a motion for the issuance of a writ of possession which
was granted by the trial court on September 14, 1982 "subject, however, to valid rights and interest of
third persons over the same portion thereof, other than vendor or any other person or persons privy to
or claiming any rights or interests under it." The corresponding writ of possession was issued on
September 20, 1982. 13
On May 20, 1982, petitioner Clara Balatbat filed a motion to intervene in Civil Case No. 134131 14 which
was granted as per court's resolution of October 21, 1982. 15 However, Clara Balatbat failed to file her
complaint in intervention. 16 On April 15, 1986, the trial court rendered a decision dismissing the
complaint, the pertinent portion of which reads: 17
The rescission of contracts are provided for in the laws and nowhere in the provision of the Civil Code
under the title Rescissible Contracts does the circumstances in the case at bar appear to have occurred,
hence, the prayer for rescission is outside the ambit for which rescissible [sic] could be granted.
The Intervenor Plaintiff, Clara Balatbat, although allowed to intervene, did not file her complaint in
intervention.
Consequently, the plaintiff having failed to prove with sufficient preponderance his action, the relief
prayed for had to be denied. The contract of sale denominated as "Deed of Absolute Sale" (Exh. 7 and
sub-markings) being valid and enforceable, the same pursuant to the provisions of Art. 1159 of the Civil
Code which says:
Obligations arising from contracts have the force of law between the contracting parties and should be
complied with in good faith.
has the effect of being the law between the parties and should be complied with. The obligation of the
plaintiff under the contract being to have the land covered by TCT No. 135671 partitioned and subdivided,
and title issued in the name of the defendant buyer (see page 2 par. C of Exh. 7-A) plaintiff had to comply
thereto to give effect to the contract.
WHEREFORE, judgment is rendered against the plaintiff, Aurelio A. Roque, and the plaintiff in intervention,
Clara Balatbat, and in favor of the defendants, dismissing the complaint for lack of merit, and declaring
the Deed of Absolute Sale dated April 1, 1980 as valid and enforceable and the plaintiff is, as he is hereby
ordered, to partition and subdivide the land covered by T.C.T. No. 135671, and to aggregate therefrom a
portion equivalent to 6/10 thereof, and cause the same to be titled in the name of the defendants, and
after which, the defendants, and after which, the defendants, and after which, the defendants, and after
which, the defendants to pay the plaintiff the sum of P45,000.00. Considering further that the defendants
suffered damages since they were forced to litigate unnecessarily, by way of their counterclaim, plaintiff
is hereby ordered to pay defendants the sum of P15,000.00 as moral damages, attorney's fees in the
amount of P5,000.00.
Costs against plaintiff.
SO ORDERED.
On March 3, 1987, petitioner Balatbat filed a notice of lis pendens in Civil Case No. 109032 before the
Register of Deeds of Manila. 18
On December 9, 1988, petitioner Clara Balatbat and her husband, Alejandro Balatbat filed the instant
complaint for delivery of the owners duplicate copy of T.C.T. No. 135671 docketed as Civil Case No. 88-
47176 before Branch 24 of the Regional Trial Court of Manila against private respondents Jose Repuyan
and Aurora Repuyan. 19
On January 27, 1989, private respondents filed their answer with affirmative defenses and compulsory
counterclaim. 20
On November 13, 1989, private respondents filed their memorandum 21 while petitioners filed their
memorandum on November 23, 1989. 22
On August 2, 1990, the Regional Trial Court of Manila, Branch 24, rendered a decision dismissing the
complaint, the dispositive portion of which reads : 23
Considering all the foregoing, this Court finds that the plaintiffs have not been able to establish their cause
of action against the defendants and have no right to the reliefs demanded in the complaint and the
complaint of the plaintiff against the defendants is hereby DISMISSED. On the counterclaim, the plaintiff
are ordered to pay defendants the amount of Ten Thousand Pesos by way of attorney's fees, Five
Thousand Pesos as costs of litigation and further to pay the costs of the suit.
SO ORDERED.
Dissatisfied, petitioner Balatbat filed an appeal before the respondent Court of Appeals which rendered
the assailed decision on August 12, 1992, to wit: 24
WHEREFORE, the judgment appealed from is affirmed with the modification that the awards of
P10,000.00 for attorney's fees and P5,000.00 as costs of litigation are deleted.
SO ORDERED.
On March 22, 1993, the respondent Court of Appeals denied petitioner's motion for reconsideration. 25
Hence, this petition for review.
Petitioner raised the following issues for this Court's resolution:
I
WHETHER OR NOT THE ALLEGED SALE TO THE PRIVATE RESPONDENTS WAS MERELY EXECUTORY AND
NOT A CONSUMMATED TRANSACTION?
II
WHETHER OR NOT THERE WAS A DOUBLE SALE AS CONTEMPLATED UNDER ART. 1544 OF THE CIVIL CODE?
III
WHETHER OR NOT PETITIONER WAS A BUYER IN GOOD FAITH AND FOR VALUE?
IV
WHETHER OR NOT THE COURT OF APPEALS ERRED IN GIVING WEIGHT AND CONSIDERATION TO THE
EVIDENCE OF THE PRIVATE RESPONDENTS WHICH WERE NOT OFFERED?
Petitioner asseverates that the respondent Court of Appeals committed grave abuse of discretion
tantamount to lack or excess of jurisdiction in affirming the appealed judgment considering (1) that the
alleged sale in favor of the private respondents Repuyan was merely executory; (2) that there is no double
sale; (3) that petitioner is a buyer in good faith and for value; and (4) that private respondents did not
offer their evidence during the trial.
Contrary to petitioner's contention that the sale dated April 1, 1980 in favor of private respondents
Repuyan was merely executory for the reason that there was no delivery of the subject property and that
consideration/price was not fully paid, we find the sale as consummated, hence, valid and enforceable. In
a decision dated April 15, 1986 of the Regional Trial Court of Manila Branch IV in Civil Case No. 134131,
the Court dismissed vendor's Aurelio Roque complaint for rescission of the deed of sale and declared that
the Sale dated April 1, 1980, as valid and enforceable. No appeal having been made, the decision became
final and executory. It must be noted that herein petitioner Balatbat filed a motion for intervention in that
case but did not file her complaint in intervention. In that case wherein Aurelio Roque sought to rescind
the April 1, 1980 deed of sale in favor of the private respondents for non-payment of the P45,000.00
balance, the trial court dismissed the complaint for rescission. Examining the terms and conditions of the
"Deed of Sale" dated April 1, 1980, the P45,000.00 balance is payable only "after the property covered by
T.C.T. No. 135671 has been partitioned and subdivided, and title issued in the name of the BUYER" hence,
vendor Roque cannot demand payment of the balance unless and until the property has been subdivided
and titled in the name of private respondents. Devoid of any stipulation that "ownership in the thing shall
not pass to the purchaser until he has fully paid the price" 26, ownership in thing shall pass from the vendor
to the vendee upon actual or constructive delivery of the thing sold even if the purchase price has not yet
been fully paid. The failure of the buyer has not yet been fully paid. The failure of the buyer to make good
the price does not, in law, cause the ownership to revest to the seller unless the bilateral contract of sale
is first rescinded or resolved pursuant to Article 1191 of the New Civil Code. 27 Non-payment only creates
a right to demand the fulfillment of the obligation or to rescind the contract.
With respect to the non-delivery of the possession of the subject property to the private respondent,
suffice it to say that ownership of the thing sold is acquired only from the time of delivery thereof, either
actual or constructive. 28Article 1498 of the Civil Code provides that when the sale is made through a
public instrument, the execution thereof shall be equivalent to the delivery of the thing which is the object
of the contract, if from the deed the contrary does not appear or cannot be inferred. 29 The execution of
the public instrument, without actual delivery of the thing, transfers the ownership from the vendor to
the vendee, who may thereafter exercise the rights of an owner over the same. 30 In the instant case,
vendor Roque delivered the owner's certificate of title to herein private respondent. It is not necessary
that vendee be physically present at every square inch of the land bought by him, possession of the public
instrument of the land is sufficient to accord him the rights of ownership. Thus, delivery of a parcel of land
may be done by placing the vendee in control and possession of the land (real) or by embodying the sale
in a public instrument (constructive). The provision of Article 1358 on the necessity of a public document
is only for convenience, not for validity or enforceability. It is not a requirement for the validity of a
contract of sale of a parcel of land that this be embodied in a public instrument. 31
A contract of sale being consensual, it is perfected by the mere consent of the parties. 32 Delivery of the
thing bought or payment of the price is not necessary for the perfection of the contract; and failure of the
vendee to pay the price after the execution of the contract does not make the sale null and void for lack
of consideration but results at most in default on the part of the vendee, for which the vendor may
exercise his legal remedies. 33
Article 1544 of the New Civil Code provides:
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 it be movable property, the ownership shall belong to the person acquiring it who in good faith
first recorded it in the 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 present the oldest title, provided there is
good faith.
Article 1544 of the Civil Code provides that in case of double sale of an immovable property, ownership
shall be transferred (1) to the person acquiring it who in good faith first recorded it in the Registry of
Property; (2) in default thereof, to the person who in good faith was first in possession; and (3) in default
thereof, to the person who presents the oldest title, provided there is good faith. 34
In the case at bar, vendor Aurelio Roque sold 6/10 portion of his share in TCT No. 135671 to private
respondents Repuyan on April 1, 1980. Subsequently, the same lot was sold again by vendor Aurelio
Roque (6/10) and his children (4/10), represented by the Clerk of Court pursuant to Section 10, Rule 39 of
the Rules of Court, on February 4, 1982. Undoubtedly, this is a case of double sale contemplated under
Article 1544 of the New Civil Code.
This is an instance of a double sale of an immovable property hence, the ownership shall vests in the
person acquiring it who in good faith first recorded it in the Registry of Property. Evidently, private
respondents Repuyan's caused the annotation of an adverse claim on the title of the subject property
denominated as Entry No. 5627/T-135671 on July 21, 1980. 35 The annotation of the adverse claim on TCT
No. 135671 in the Registry of Property is sufficient compliance as mandated by law and serves notice to
the whole world.
On the other hand, petitioner filed a notice of lis pendens only on February 2, 1982. Accordingly, private
respondents who first caused the annotation of the adverse claim in good faith shall have a better right
over herein petitioner. Moreover, the physical possession of herein petitioners by virtue of a writ of
possession issued by the trial court on September 20, 1982 is "subject to the valid rights and interest of
third persons over the same portion thereof, other than vendor or any other person or persons privy to
or claiming any rights to interest under it." 36 As between two purchasers, the one who has registered the
sale in his favor, has a preferred right over the other who has not registered his title even if the latter is in
actual possession of the immovable property. 3 7 Further, even in default of the first registrant or first in
possession, private respondents have presented the oldest title. 38 Thus, private respondents who
acquired the subject property in good faith and for valuable consideration established a superior right as
against the petitioner.
Evidently, petitioner cannot be considered as a buyer in good faith. In the complaint for rescission filed by
vendor Aurelio Roque on August 20, 1980, herein petitioner filed a motion for intervention on May 20,
1982 but did not file her complaint in intervention, hence, the decision was rendered adversely against
her. If petitioner did investigate before buying the land on February 4, 1982, she should have known that
there was a pending case and an annotation of adverse claim was made in the title of the property before
the Register of Deeds and she could have discovered that the subject property was already sold to the
private respondents. It is incumbent upon the vendee of the property to ask for the delivery of the owner's
duplicate copy of the title from the vendor. A purchaser of a valued piece of property cannot just close
his eyes to facts which should put a reasonable man upon his guard and then claim that he acted in good
faith and under the belief that there were no defect in the title of the vendor. 39 One who purchases real
estate with knowledge of a defect or lack of title in his vendor cannot claim that he has acquired title
thereto in good faith as against the true owner of the land or of an interest therein; and the same rule
must be applied to one who has knowledge of facts which should have put him upon such inquiry and
investigation as might be necessary to acquaint him with the defects in the title of his vendor. Good faith,
or the want of it is not a visible, tangible fact that can be seen or touched, but rather a state or condition
of mind which can only be judged of by actual or fancied tokens or signs. 40
In fine, petitioner had nobody to blame but herself in dealing with the disputed property for failure to
inquire or discover a flaw in the title to the property, thus, it is axiomatic that culpa lata dolo
aequiparatur gross negligence is equivalent to intentional wrong.
IN VIEW OF THE FOREGOING PREMISES, this petition for review is hereby DISMISSED for lack of merit. No
pronouncement as to costs.
IT IS SO ORDERED.