HEIRS OF PEDRO ESCANLAR V.

CA
G.R. No. 119777
October 23, 1997

Facts:

 Spouses Guillermo Nombre and Victoriana Cari-an died with their relatives as their heirs.
 2 parcels of land (Lot No. 1616 & 1617) of the Kabankalan Cadastre formed part of the estate of
Nombre and Cari-an.
 Thereafter, Gregorio Cari-an's heirs (private respondents Cari-an) executed the Deed of Sale of
Rights, Interests and Participation.
 The Contract of Sale of rights, interests and participations shall become effective only upon the
approval by the Honorable Court of First Instance of Negros Occidental, Branch VI- Himamayla.
 Pedro Escanlar and Francisco Holgado, the vendees, were concurrently the lessees of the lots
referred to above. They stipulated that the balance of the purchase price (P225,000.00) shall be
paid on or before May 1979 in a Deed of Agreement executed by the parties on the same day.
 It was also stipulated that in the event the Vendees fail and/or omit to pay the balance of said
purchase price on May 31, 1979 and the cancellation of said Contract of Sale is made thereby, the
sum of FIFTY THOUSAND (P50,000.00) Pesos shall be deemed as damages thereof to Vendors.
 Petitioners were unable to pay the Cari-an heirs' individual shares, amounting to P55,000.00 each,
by the due date.
 However, said heirs received at least 12 installments from petitioners after May 1979.
 Being former lessees, petitioners continued in possession of Lot Nos. 1616 and 1617. Interestingly,
they continued to pay rent based on their lease contract.
 Petitioners moved to intervene in the probate proceedings of Nombre and Cari-an as the buyers of
private respondent Cari-an's share in Lot Nos. 1616 and 1617. Petitioners' motion for approval of
the sales, was opposed by private respondents.
 The probate court approved a motion filed by the heirs of Cari-an and Nombre to sell their
respective shares in the estate.
 Then, private respondents Cari-an sold their shares in 8 parcels of land including Lot Nos. 1616 and
1617 to the spouses Ney Sarrosa Chua and Paquito Chua.
 1 week later, the vendor-heirs, including private respondents Cari-an, filed a motion for approval of
sale of hereditary rights.
 Private respondents Cari-an instituted this case for cancellation of sale against petitioners (Escanlar
and Holgado) in the RTC. They complained of petitioners' failure to pay the balance of the purchase
price by May 31, 1979 and alleged that they only received a total of P132,551.00 in cash and
goods.
 Petitioners replied that the Cari-ans, having been paid, had no right to resell the subject lots; that
the Chuas were purchasers in bad faith; and that the court approval of the sale to the Chuas was
subject to their existing claim over said properties.
 Petitioners also sold their rights and interests in the subject parcels of land (Lot Nos. 1616 and
1617) to Edwin Jayme for P735,000.00 and turned over possession of both lots to the latter. The
Jaymes in turn, were included in the civil case as fourth-party defendants.
 The probate court approved the sale to Chuas "without prejudice to whatever rights, claims and
interests over any of those properties of the estate which cannot be properly and legally ventilated
and resolved by the court in the same intestate proceedings.
 The certificates of title over the 8 lots sold by the heirs of Nombre and Cari-an were later issued in
the name of respondents Ney Sarrosa Chua and Paquito Chua.
 The RTC allowed a third-party complaint against the third-party defendants Paquito and Ney Chua
where Escanlar and Holgado alleged that the Cari-ans conspired with the Chuas when they
executed the second sale on and that the latter sale is illegal and of no effect.
 Respondents Chua countered that they did not know of the earlier sale of one-half portion of the
subject lots to Escanlar and Holgado. Both parties claimed damages.
 The RTC approved the Chuas' motion to file a fourth-party complaint against the spouses Jayme.
 Respondents Chua alleged that the Jaymes refused to vacate said lots despite repeated demands;
and that by reason of the illegal occupation of Lot Nos. 1616 and 1617 by the Jaymes, they
suffered materially from uncollected rentals.
 Meanwhile, the RTC Court of Himamaylan which took cognizance of Special Proceeding No. 7-7279
(Intestate Estate of Guillermo Nombre and Victoriana Cari-an) had rendered its decision concluding
 that since all the properties of the estate were disposed of or sold by the declared heirs of both
spouses, the case is considered terminated and the intestate estate of Guillermo Nombre and
Victoriana Cari-an is closed.
 The seminal case at bar was resolved by the RTC in favor of cancellation of the sale to the Escanlar
& Holgado. Said transaction was nullified because it was not approved by the probate court as
required by the contested deed of sale of rights, interests and participation and because the Cari-
ans were not fully paid. Consequently, the Deed of Sale executed by the heirs of Nombre and Cari-
an in favor of Paquito and Ney Chua, which was approved by the probate court, was upheld.
 Petitioners appealed to the CA. Respondent court affirmed the decision of the RTC and held that
the questioned deed of sale of rights, interests and participation is a contract to sell because it shall
become effective only upon approval by the probate court and upon full payment of the purchase
price.
 Petitioners' motion for reconsideration was denied.

Issue: WON there is a contact to sell and not one of sale.

Held: NO. The distinction between contracts of sale and contracts to sell with reserved title has been
recognized by this Court in repeated decisions, upholding the power of promisors under contracts to sell in
case of failure of the other party to complete payment, to extrajudicially terminate the operation of the
contract, refuse the conveyance, and retain the sums of installments already received where such rights
are expressly provided for.

In contracts to sell, ownership is retained by the seller and is not to pass until the full payment of the
price. Such payment is a positive suspensive condition, the failure of which is not a breach of contract but
simply an event that prevented the obligation of the vendor to convey title from acquiring binding force.
To illustrate, although a deed of conditional sale is denominated as such, absent a proviso that title to the
property sold is reserved in the vendor until full payment of the purchase price nor a stipulation giving the
vendor the right to unilaterally rescind the contract the moment the vendee fails to pay within a fixed
period, by its nature, it shall be declared a deed of absolute sale.

The September 15, 1978 sale of rights, interests and participation as to 1/2 portion pro indiviso of the two
subject lots is a contract of sale for the following reasons: First, private respondents as sellers did not
reserve unto themselves the ownership of the property until full payment of the unpaid balance of
P225,000.00. Second, there is no stipulation giving the sellers the right to unilaterally rescind the contract
the moment the buyer fails to pay within the fixed period.24 Prior to the sale, petitioners were in
possession of the subject property as lessees. Upon sale to them of the rights, interests and participation
as to the 1/2 portion pro indiviso, they remained in possession, not in concept of lessees anymore but as
owners now through symbolic delivery known as traditio brevi manu. Under Article 1477 of the Civil Code,
the ownership of the thing sold is acquired by the vendee upon actual or constructive delivery thereof.

In a contract of sale, the non-payment of the price is a resolutory condition which extinguishes the
transaction that, for a time, existed and discharges the obligations created thereunder. The remedy of an
unpaid seller in a contract of sale is to seek either specific performance or rescission.

AKANG vs. MUNICIPALITY OF ISULAN, SULTAN KUDARA T PROVINCE

G.R. No. 186014
June 26, 2013

Facts:
 Ali Akang (petitioner) is a member of the national and cultural community belonging to the
Maguindanaon tribe of Isulan, Province of Sultan Kudarat and the registered owner of Lot 5-B-2-B-
14-F (LRC) covered a TCT.
 Sometime in 1962, a 2-hectare portion of the property was sold by the petitioner to the
Municipality of Isulan, Province of Sultan Kudarat (respondent) through then Isulan Mayor Datu
Ampatuan under a Deed of Sale.
 The respondent immediately took possession of the property and began construction of the
municipal building.
  After 39 years, the petitioner, together with his wife, Patao Talipasan, filed a civil action for
Recovery of Possession of Subject Property and/or Quieting of Title thereon and Damages against
the respondent, represented by its Municipal Mayor, et al.
 The petitioner alleged that the agreement was one to sell, which was not consummated as the
purchase price was not paid.
 The respondent denied the petitioner’s allegations and claimed that the petitioner’s cause of action
was already barred by laches; that the Deed of Sale was valid; and that it has been in open,
continuous and exclusive possession of the property for forty (40) years.
 The RTC ruled in favor of the petitioner. The RTC construed the Deed of Sale as a contract to sell,
based on the wording of the contract, which allegedly showed that the consideration was still to be
paid and delivered on some future date – a characteristic of a contract to sell.
 By virtue of said RTC decision, proceedings for the Cancellation of Certificate of Title No. T-49349
registered under the name of the respondent was instituted by the petitioner under Miscellaneous
Case No. 866 and as a result, the respondent’s title over the property was cancelled and a new one
issued in the name of the petitioner.
 The respondent appealed to the CA and it reversed the ruling of the RTC and upheld the validity of
the sale. The appellate court sustained the respondent’s arguments and ruled that the petitioner is
not entitled to recover ownership and possession of the property as the Deed of Sale already
transferred ownership thereof to the respondent. The CA held that the doctrines of estoppel and
laches must apply against the petitioner. It also ruled that the Deed of Sale is not a mere contract
to sell but a perfected contract of sale. There was no express reservation of ownership of title by
the petitioner and the fact that there was yet no payment at the time of the sale does not affect
the validity or prevent the perfection of the sale.
 Petitioner filed an MR but was denied.

Issue: WON the Deed of Sale is a valid and perfected contract of sale

Held: YES. The SC ruled in favor of the respondent.

The elements of a contract of sale are: (a) consent or meeting of the minds, that is, consent to transfer
ownership in exchange for the price; (b) determinate subject matter; and (c) price certain in money or its
equivalent.

A contract to sell, on the other hand, is defined by Article 1479 of the Civil Code:

A bilateral contract whereby the prospective seller, while expressly reserving the ownership of the subject
property despite delivery thereof to the prospective buyer, binds himself to sell the said property
exclusively to the prospective buyer upon fulfillment of the condition agreed upon, that is, full payment of
the purchase price.

In a contract of sale, the title to the property passes to the buyer upon the delivery of the thing sold,
whereas in a contract to sell, the ownership is, by agreement, retained by the seller and is not to pass to
the vendee until full payment of the purchase price.

The Deed of Sale executed by the petitioner and the respondent is a perfected contract of sale, all its
elements being present. There was mutual agreement between them to enter into the sale, as shown by
their free and voluntary signing of the contract. There was also an absolute transfer of ownership of the
property by the petitioner to the respondent as shown in the stipulation: "x x x I petitioner hereby sell,
transfer, cede, convey and assign as by these presents do have sold, transferred, ceded, conveyed and
assigned, x x x." There was also a determine subject matter, that is, the two-hectare parcel of land as
described in the Deed of Sale. Lastly, the price or consideration is at Three Thousand Pesos (₱3,000.00),
which was to be paid after the execution of the contract.

The fact that no express reservation of ownership or title to the property can be found in the Deed of Sale
bolsters the absence of such intent, and the contract, therefore, could not be one to sell. Had the intention
of the petitioner been otherwise, he could have: (1) immediately sought judicial recourse to prevent
further construction of the municipal building; or (2) taken legal action to contest the agreement. The
petitioner did not opt to undertake any of such recourses.
 ALMIRA v. CA
G.R. No. 115966
March 20, 2003

Facts:

 Petitioners are the wife and the children of the late Julio Garcia who inherited from his mother,
Maria Alibudbud, a portion of Lot 1642 of the Sta. Rosa Estate and covered by TCT No. RT-1076.
 Lot 1642 was co-owned and registered in the names of three persons namely, Vicente de Guzman,
Enrique Hemedes, and Francisco Alibudbud, the father of Maria Alibudbud.
 Although there was no separate title in the name of Julio Garcia, there were tax declarations in his
name to the extent of his grandfathers share.
 Then, the heirs of Julio Garcia, and respondent Federico Briones entered into a Kasunduan ng
Pagbibilihan over the 21,460 square-meter portion for the sum of P150,000.00.
 Respondent paid P65,000.00 upon execution of the contract while the balance of P85,000.00 was
made payable within six (6) months from the date of the execution of the instrument.
 At the time of the execution of the Kasunduan, petitioners allegedly informed respondent that TCT
No. RT-1076 was in the possession of their cousin, Conchalina Alibudbud who having bought
Vicente de Guzmans share, owned the bigger portion of Lot 1642. This notwithstanding,
respondent willingly entered into the Kasunduan provided that the full payment of the purchase
price will be made upon delivery to him of the title.
 Respondent took possession of the property subject of the Kasunduan and made various payments
to petitioners amounting to P58,500.00.
 However, upon failure of petitioners to deliver to him a separate title to the property in the name of
Julio Garcia, he refused to make further payments.
 Petitioners filed a civil action before the RTC for (a) rescission of the Kasunduan; (b) return by
respondent to petitioners of the possession of the subject parcel of land; and (c) payment by
respondent of damages in favor of petitioners.
 Petitioners alleged that respondent was bound to pay the balance of the purchase price within six
(6) months from the date of the execution of the Kasunduan and upon delivery to him of TCT No.
RT-1076.
 Respondent, on the other hand, filed a counterclaim for damages and averred that he refused to
make further payments because of petitioners failure to deliver to him a separate title in the name
of Julio Garcia.
 The RTC in favor of the plaintiffs and against the defendant decreeing the rescission of the
Kasunduan and ordered the defendant to return and restore possession of the property.
 On appeal, the CA, however, noting that the Kasunduan made no reference to TCT No. RT-1076,
reversed the decision of the RTC and dismissed the complaint. The appellate court opined that the
parties intended to refer to a separate title over the 21,460 square meter lot when the Kasunduan
mentioned a kaukulang titulo ng lupang nabanggit since it was the portion which was covered by a
separate tax declaration in the name of Julio Garcia and it was the portion that petitioners could
sell. The appellate court noted that the actuations of the parties subsequent to the execution of the
Kasunduan confirmed respondents claim that a separate title to the property subject of the
Kasunduan should be delivered to him.
 Hence, this petition.

Issue: WON the payment of the balance of the purchase price is conditioned upon delivery of a separate
title in the name of Julio Garcia.

Held: YES. The tenor of the correspondence between petitioners and respondent shows that the parties
intended that a separate title to the property in the name of Julio Garcia shall be delivered to respondent
as a condition for the latters payment of the balance of the purchase price. Thus, petitioner Juana Almiras
letter to respondent reads:

Ang totoo po ngayon ay kailangan naming ang halagang LABING LIMANG LIBO (P15,000.00) PISO, yan po
ang dahilan kung bakit kami ay sumulat sa inyo, sapagkat sa mga unang naghawak at nag-ayos ng
papeles ng lupang ito ay hindi nila naayos at hindi nila natapos, kaya po kami ay nakakita at malaki po
ang nagastos naming sa una na walang nangyari, kaya nga itong huli ay lalong lumaki
Unawain po naman ninyo kami sa halagang kailangan naming para sa huling gumagawa ng Titulo ng lupa
para naman po maayos na ito.

Respondent signified his willingness to pay the balance of the purchase price but reminded petitioners of
their obligation to deliver title to the property in the following reply:

Hindi lingid sa inyong kaalaman na sa ilalim ng naubit na Kasunduan ng Pagbibilihan ay maliwanag ang
inyong tungkulin na ipagkaboob sa amin ang kaukulang titulo ng lupa sa boob ng anim (6) na buwan
simula sa takda ng nasabing kasulatan at kami naman ay nahahandang magbayad ng lahat ng nalababing
kabayaran x x x at tuwing kayo ay kukuha ng pera ang lagi niyong idinadahilan ay ang diumano ay
paglalakad tungkol sa titulo. x x x

Had the parties intended that petitioners deliver TCT No. RT-1076 instead of a separate title in the name
of Julio Garcia to respondent, then there would have been no need for petitioners to ask for partial sums
on the ground that this would be used to pay for the processing of the title to the property. Petitioners had
only to present the existing title, TCT No. RT-1076, to respondent and demand the balance of the
purchase price. This, petitioners did not do. There is thus no basis to conclude that insufficiency of funds
rather than failure of petitioners to deliver a separate title in the name of Julio Garcia prevented
respondent from completing payment of the purchase price.

That the parties agreed on delivery of a separate title in the name of Julio Garcia as a condition for
respondents payment of the balance of the purchase price is bolstered by the fact that there was already
an approved subdivision plan of the 21,460 square-meter lot years before petitioners filed an action in
court for rescission.

Finally, we note that, as quoted earlier, the Kasunduan itself in its opening paragraph refers to the subject
property being sold as buong lawak na 21,640 metrong parisukat, x x x at sa kasalukuyan may
nabibinbing kahilingan sa hukuman upang magkaroon ng sariling titulo; x x x. The next paragraph of the
Kasunduan, therefore, which speaks of ang kaukulang titulo sa lupang nabanggit, clearly refers to the
separate title being applied for, even without resort to extraneous evidence.

Although both parties have consistently referred to the Kasunduan as a contract to sell, a careful reading
of the provisions of the Kasunduan reveals that it is a contract of sale. A deed of sale is absolute in nature
in the absence of any stipulation reserving title to the vendor until full payment of the purchase price.

In such cases ownership of the thing sold passes to the vendee upon actual or constructive delivery
thereof. There is nothing in the Kasunduan which expressly provides that petitioners retain title or
ownership of the property, until full payment of the purchase price. The absence of such stipulation in the
Kasunduan coupled with the fact that respondent took possession of the property upon the execution of
the Kasunduan indicate that the parties have contemplated a contract of absolute sale.

Stated otherwise, there was a perfected contract of sale. The parties agreed on the sale of a determinate
object, i.e., 21, 460 square meters of Lot 1642, covered by a tax declaration in the name of Julio Garcia,
and the price certain therefor, without any reservation of title on the part of petitioners. Ownership was
effectively conveyed by petitioners to respondent, who was given possession of the property.

The delivery of a separate title in the name of Julio Garcia was a condition imposed on respondents
obligation to pay the balance of the purchase price. It was not a condition imposed on the perfection of
the contract of sale. In Laforteza v. Machuca, we stated that the fact that the obligation to pay the balance
of the purchase price was made subject to the condition that the seller first deliver the reconstituted title
of the property does not make the agreement a contract to sell for such condition is not inconsistent with
a contract of sale.

PORTIC v. CRISTOBAL
G.R. No. 156171
April 22, 2005

Facts:
  Spouses Clodualdo Alcantara and Candelaria Edrosalam were the original registered owners of a
parcel of land with three-door apartment in Valenzuela City.
 The spouses sold the subject property in favor of petitioners with the condition that the latter shall
assume the mortgage executed over the subject property in favor of the Social Security System.
 Petitioners Portic defaulted in the payment of the mortgage loan which prompted the SSS to
foreclose the mortgage. After the public auction, SSS was declared as the highest bidder.
 Before the expiration of the redemption period, Portic sold the subject property in favor of Cristobal
in consideration of ₱200,025.
 The parties agreed that respondent shall pay the sum of ₱45,025 as down payment and the
balance of ₱155,000.00 shall be paid on or before May 22, 1985. The parties further agreed that in
case respondent should fail to comply with the conditions, the sale shall be considered void and
petitioners shall reimburse respondent of whatever amount already paid.
 Portic and Cristobal executed a ‘Deed of Sale with Assumption of Mortgage’ whereby the former
sold the subject property in favor of the latter in consideration of ₱80,000.00, ₱45,000.00 thereof
shall be paid to the SSS.
 The spouses sold the subject property in favor of respondent for ₱50,000.00. On the same date,
Crsitobal executed a ‘Deed of Mortgage’ whereby she constituted a mortgage over the subject
property to secure a ₱150,000.00 indebtedness in favor of Portic.
 Cristobal paid the indebtedness due over the subject property to the SSS.
 The TCT of the property in the names of spouses was cancelled and in lieu thereof a TCT was
issued in the name of respondent.
 Portic demanded from Cristobal the alleged unpaid balance of ₱55,000.00 but the latter refused to
pay.
 Portic filed this instant civil case against Cristobal to remove the cloud created by the issuance of
TCT No. T-113299 in favor of the latter.
 Portic claimed that Cristobal failed to fully pay the purchase price within the period and that on
account of this failure, the sale is void.
 Cristobal on her part claimed that her title over the subject property is already indefeasible and
that the true agreement of the parties is that embodied in the Deed of Absolute Sale with
Assumption of Mortgage.
 The RTC ruled in favor of Portic. The court ordered the quieting of title or removal of cloud over the
petitioners’ parcel of land and three (3) door apartment now covered by TCT No. T-113299 of the
RD for Caloocan City. The court also Cristobal to reconvey in favor of the Portic the parcel of land
and three (3) door apartment after reimbursement by the Portic of the amount actually paid by the
Cristobal.
 On appeal, the CA opined that the first Memorandum of Agreement (MOA) embodied the real
agreement between the parties, and that the subsequent Deeds were executed merely to secure
their respective rights over the property. The MOA stated that Cristobal had not fully paid the
purchase price. However, an action to annul the Deed of Sale have already prescribed.
Nonetheless, in conformity with the principle of unjust enrichment, the CA ordered respondent to
pay petitioners the remaining balance of the purchase price.
 Hence, this Petition.

Issue: WON the Memorandum of Agreement between the parties is a contract of sale vesting ownership
to respondent Cristobal

Held: YES. The claim of respondent Crsitobal cannot be sustained. The transfer of ownership of the
premises in her favor was subject to the suspensive condition stipulated by the parties in the MOA, which
states as follows:

"3. That while the balance of ₱155,000.00 has not yet been fully paid the FIRST PARTY
OWNERS shall retain the ownership of the above described parcel of land together with its
improvements but the SECOND PARTY BUYER shall have the right to collect the monthly
rentals due on the first door (13-A) of the said apartment;"

The above-cited provision characterizes the agreement between the parties as a contract to sell, not a
contract of sale. Ownership is retained by the vendors, the Portics; it will not be passed to the vendee, the
Cristobals, until the full payment of the purchase price. Such payment is a positive suspensive condition,
and failure to comply with it is not a breach of obligation; it is merely an event that prevents the
effectivity of the obligation of the vendor to convey the title.

The mere issuance of the Certificate of Title in favor of Cristobal did not vest ownership in her. Neither did
it validate the alleged absolute purchase of the lot. Time and time again, this Court has stressed that
registration does not vest, but merely serves as evidence of, title. Our land registration laws do not give
the holders any better title than that which they actually have prior to registration.

Under Article 1544 of the Civil Code, mere registration is not enough to acquire a new title. Good faith
must concur. Clearly, respondent has not yet fully paid the purchase price. Hence, as long as it remains
unpaid, she cannot feign good faith. She is also precluded from asserting ownership against petitioners.
The appellate court’s finding that she had a valid title to the property must, therefore, be set aside.