Case Brief: Inchausti & Co vs. Cromwell

INCHAUSTI & CO., Plaintiff-Appellant,
v.
ELLIS CROMWELL, Collector of Internal Revenue, Defendant-Appellee.
G.R. No. 6584. October 16, 1911.

FACTS:

Inchausti & Co. is engaged in the business of buying and selling at wholesale hemp, both for its own account and on commission. The operation of of baling hemp is designated among merchants by the word ‘prensaje.’ Inchausti, in all its sales of hemp, quoted the price to the buyer at so much per picul, no mention being made of baling. The company in accordance with the custom mentioned in paragraph V hereof, collected and received, under the denomination of ‘prensaje,’ from purchasers of hemp sold by the said firm for its own account, in addition to the price expressly agreed upon for the said hemp, sums aggregating P380,124.35 and collected for the account of the owners of hemp sold by the plaintiff firm in Manila on commission, and under the said denomination of ‘prensaje,’ in addition to the price expressly agreed upon for said hemp, sums aggregating P31,080. Inchausti has always paid to Ellis Cromwell, in the office of the Collector of Internal Revenue the tax collectible upon the selling price expressly agreed upon for all hemp sold but has not, until compelled to do so, paid the said tax upon sums received from the purchaser of such hemp under the denomination of ‘prensaje.’ Ellis Cromwell, in his capacity as Collector of Internal Revenue, made demand in writing upon the plaintiff firm for the payment within the period of five (5) days of the sum of P1,370.68, the amount collected from purchasers of hemp under the denomination of ‘prensaje.’ Inchausti paid for such demand under protest but Cromwell still refuses to return such amount.

The contention of the defendant was that the said charge made under the denomination of “prensaje” is in truth and in fact a part of the gross value of the hemp sold and of its actual selling price, and that therefore the tax imposed by section 139 of Act No. 1189 lawfully accrued on said sums, that the collection thereof was lawfully and properly made and that therefore the plaintiff is not entitled to recover back said sum or any part thereof; and that the defendant should have judgment against plaintiff for his costs.

ISSUES:
1. Whether the price for the contract of sale should include the charge made under the denomination of “prensaje”
2. Whether there exists a contract of sale.

HELD:

The Supreme Court stated that there can be no question that, if the value of the hemp were not augmented to the amount of P1.75 per bale by said operation, the purchaser would not pay that sum. If one buys a bale of hemp at a stipulated price of P20, well knowing that there is an agreement on his part, express or implied, to pay an additional amount of P1.75 for that bale, he considers the bale of hemp worth P21.75. It is agreed, as we have before stated, that hemp is sold in bales. Therefore, baling is performed before the sale. The purchaser of hemp owes to the seller nothing whatever by reason of their contract except the value of the hemp delivered. That value, that sum which the purchaser pays to the vendee, is the true selling price of the hemp, and every item which enters into such price is a part of such selling price. By force of the custom prevailing among hemp dealers in the Philippine Islands, a purchaser of hemp in the market, unless he expressly stipulates that it shall be delivered to him in loose form, obligates himself to purchase and pay for baled hemp. Whether or not such agreement is express or implied, whether it is actual or tacit, it has the same force. After such an agreement has once been made by the purchaser, he has no right to insist thereafter that the seller shall furnish him with unbaled hemp. It is undoubted that the vendees, in the sales referred to in the case at bar, would have had no right, after having made their contracts, to insist on the delivery of loose hemp with the purpose in view themselves to perform the baling and thus save 75 centavos per bale. It is unquestioned that the seller, the plaintiff, would have stood upon his original contract of sale, that is, the obligation to deliver baled hemp, and would have forced his vendees to accept baled hemp, he himself retaining among his own profits those which accrued from the process of baling. The Court stated that the distinction between a contract of sale and one for work, labor, and materials, is tested by the inquiry whether the thing transferred is one not in existence and which would never have existed but for the order of the party desiring to acquire it, or a thing which would have existed and been the subject of sale to some other person, even if the order had not been given. Further, when a person stipulates for the future sale of articles which he is habitually making, and which at the time are not made or finished, it is essentially a contract of sale and not a contract for labor. It is otherwise where the article would not have been made but for the agreement; and where the article ordered by the purchase is exactly such as the vendor makes and keeps on hand for sale to anyone, and no change or modification of it is made at the vendee’s request, it is a contract of sale even though it be entirely made after and in consequence of the vendee’s order for it. Furthermore, the Court defined “price.” The word “price” signifies the sum stipulated as the equivalent of the thing sold and also every incident taken into consideration f or the fixing of the price put to the debit of the vendee and agreed to by him.

 

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Case Brief: Ong vs. Ong

IMELDA ONG, ET AL., petitioners,
vs.
ALFREDO ONG, ET AL., respondents.
G.R. No. L-67888 October 8, 1985

Facts:

On February 25, 1976 Imelda Ong, for and in consideration of One (P1.00) Peso and other valuable considerations, executed in favor of private respondent Sandra Maruzzo, then a minor, a Quitclaim Deed whereby she transferred, released, assigned and forever quit-claimed to Sandra Maruzzo, her heirs and assigns, all her rights, title, interest and participation in the ONE-HALF (½) undivided portion of the parcel of land.

On November 19, 1980, Imelda Ong revoked the aforesaid Deed of Quitclaim and, thereafter, on January 20, 1982 donated the whole property described above to her son, Rex Ong-Jimenez.

Sandra Maruzzo, through her guardian (ad litem) Alfredo Ong, filed with the Regional Trial Court of Makati, Metro Manila an action against petitioners, for the recovery of ownership/possession and nullification of the Deed of Donation over the portion belonging to her and for Accounting.

Petitioners claimed that the Quitclaim Deed is null and void inasmuch as it is equivalent to a Deed of Donation, acceptance of which by the donee is necessary to give it validity. Further, it is averred that the donee, Sandra Maruzzo, being a minor, had no legal personality and therefore incapable of accepting the donation.

The trial court rendered judgment in favor of respondent Maruzzo and held that the Quitclaim Deed is equivalent to a Deed of Sale and, hence, there was a valid conveyance in favor of the latter.

Petitioners appealed to the respondent Intermediate Appellate Court. They reiterated their argument below and, in addition, contended that the One (P1.00) Peso consideration is not a consideration at all to sustain the ruling that the Deed of Quitclaim is equivalent to a sale.

Respondent Intermediate Appellate Court promulgated its Decision affirming the appealed judgment and held that the Quitclaim Deed is a conveyance of property with a valid cause or consideration; that the consideration is the One (P1.00) Peso which is clearly stated in the deed itself; that the apparent inadequacy is of no moment since it is the usual practice in deeds of conveyance to place a nominal amount although there is a more valuable consideration given.

Issue:

Whether a Quitclaim Deed is equivalent to a Deed of Sale

Held:

A careful perusal of the subject deed reveals that the conveyance of the one- half (½) undivided portion of the above-described property was for and in consideration of the One (P 1.00) Peso and the other valuable considerations (emphasis supplied) paid by private respondent Sandra Maruzzo through her representative, Alfredo Ong, to petitioner Imelda Ong. Stated differently, the cause or consideration is not the One (P1.00) Peso alone but also the other valuable considerations.

The execution of a deed purporting to convey ownership of a realty is in itself prima facie evidence of the existence of a valuable consideration, the party alleging lack of consideration has the burden of proving such allegation.

Even granting that the Quitclaim deed in question is a donation, Article 741 of the Civil Code provides that the requirement of the acceptance of the donation in favor of minor by parents of legal representatives applies only to onerous and conditional donations where the donation may have to assume certain charges or burdens (Article 726, Civil Code).

The donation to an incapacitated donee does not need the acceptance by the lawful representative if said donation does not contain any condition. In simple and pure donation, the formal acceptance is not important for the donor requires no right to be protected and the donee neither undertakes to do anything nor assumes any obligation. The Quitclaim now in question does not impose any condition.

Bad faith and inadequacy of the monetary consideration do not render a conveyance inexistent, for the assignor’s liberality may be sufficient cause for a valid contract (Article 1350, Civil Code), whereas fraud or bad faith may render either rescissible or voidable, although valid until annulled, a contract concerning an object certain entered into with a cause and with the consent of the contracting parties, as in the case at bar.”

WHEREFORE. the appealed decision of the Intermediate Appellate Court should be, as it is hereby AFFIRMED, with costs against herein petitioners.

Case Brief: Schuback & Sons Philippine Trading Corporation vs. CA

JOHANNES SCHUBACK & SONS PHILIPPINE TRADING CORPORATION, petitioner,
vs.
THE HON. COURT OF APPEALS, RAMON SAN JOSE, JR., doing business under the name and style “PHILIPPINE SJ INDUSTRIAL TRADING,” respondents.
G.R. No. 105387 November 11, 1993

FACTS:

Sometime in 1981, the defendant established a contract with plaintiff through the Philippine Consulate General in Hamburg, West Germany, because he wanted to purchase MAN bus spare parts from Germany. Plaintiff communicated with its trading partner, JOHANNES SCHUBACK & SONS PHILIPPINE TRADING CORPORATION (Schuback Hamburg) regarding the spare parts defendant wanted to order. Defendant submitted to plaintiff a list of the parts he wanted to purchase with specific part numbers and description. Plaintiff sent to defendant a letter dated 25 November, 1981, enclosing its offer on the items listed by defendant.

Plaintiff submitted its formal offer containing the item number, quantity, part number, description, unit price and total to defendant. On December, 24, 1981, defendant informed plaintiff of his desire to avail of the prices of the parts at that time.

Plaintiff immediately ordered the items needed by defendant from Schuback Hamburg to enable defendant to avail of the old prices. Schuback Hamburg in turn ordered the items from NDK, a supplier of MAN spare parts in West Germany. On January 4, 1982, Schuback Hamburg sent plaintiff a proforma invoice to be used by defendant in applying for a letter of credit. Said invoice required that the letter of credit be opened in favor of Schuback Hamburg.

On October 18, 1982, Plaintiff again reminded defendant of his order and advised that the case may be endorsed to its lawyers. Defendant replied that he did not make any valid Purchase Order and that there was no definite contract between him and plaintiff. Plaintiff sent a rejoinder explaining that there is a valid Purchase Order and suggesting that defendant either proceed with the order and open a letter of credit or cancel the order and pay the cancellation fee of 30% of F.O.B. value, or plaintiff will endorse the case to its lawyers.

Consequently, petitioner filed a complaint for recovery of actual or compensatory damages, unearned profits, interest, attorney’s fees and costs against private respondent.

In its decision dated June 13, 1988, the trial court ruled in favor of petitioner by ordering private respondent to pay petitioner, among others, actual compensatory damages in the amount of DM 51,917.81, unearned profits in the amount of DM 14,061.07, or their peso equivalent.

Thereafter, private respondent elevated his case before the Court of Appeals. On February 18, 1992, the appellate court reversed the decision of the trial court and dismissed the complaint of petitioner. It ruled that there was no perfection of contract since there was no meeting of the minds as to the price between the last week of December 1981 and the first week of January 1982.

Issue:

Whether or not a contract of sale has been perfected between the parties

Held:

The Supreme Court reversed the decision of the Court of Appeals and reinstated the decision of the trial court. It bears emphasizing that a “contract of sale is perfected at the moment there is a meeting of minds upon the thing which is the object of the contract and upon the price.”

Article 1319 of the Civil Code states: “Consent is manifested by the meeting of the offer and acceptance upon the thing and the cause which are to constitute the contract. The offer must be certain and the acceptance absolute. A qualified acceptance constitutes a counter offer.” The facts presented to us indicate that consent on both sides has been manifested.

The offer by petitioner was manifested on December 17, 1981 when petitioner submitted its proposal containing the item number, quantity, part number, description, the unit price and total to private respondent. On December 24, 1981, private respondent informed petitioner of his desire to avail of the prices of the parts at that time and simultaneously enclosed its Purchase Order No. 0l01 dated December 14, 1981. At this stage, a meeting of the minds between vendor and vendee has occurred, the object of the contract: being the spare parts and the consideration, the price stated in petitioner’s offer dated December 17, 1981 and accepted by the respondent on December 24,1981.

When petitioner forwarded its purchase order to NDK, the price was still pegged at the old one. Thus, the pronouncement of the Court Appeals that there as no confirmed price on or about the last week of December 1981 and/or the first week of January 1982 was erroneous.

On the part of the buyer, the situation reveals that private respondent failed to open an irrevocable letter of credit without recourse in favor of Johannes Schuback of Hamburg, Germany. This omission, however, does not prevent the perfection of the contract between the parties.

The opening of a letter of credit in favor of a vendor is only a mode of payment. It is not among the essential requirements of a contract of sale enumerated in Article 1305 and 1474 of the Civil Code, the absence of any of which will prevent the perfection of the contract from taking place.

To adopt the Court of Appeals’ ruling that the contract of sale was dependent on the opening of a letter of credit would be untenable from a pragmatic point of view because private respondent would not be able to avail of the old prices which were open to him only for a limited period of time.

WHEREFORE, the petition is GRANTED and the decision of the trial court dated June 13, 1988 is REINSTATED with modification.

Case Brief: Mapalo vs. Mapalo

MIGUEL MAPALO, ET AL., petitioners,
vs.
MAXIMO MAPALO, ET AL., respondents.
G.R. No. L-21489 and L-21628 May 19, 1966

Facts:

The spouses Miguel Mapalo and Candida Quiba were the registered owners of a residential land located in Pangasinan. The spouses donated the eastern half of the land to Miguel’s brother – Maximo Mapalo who was about to get married. However, they were deceived into signing, on October 15, 1936, a deed of absolute sale over the entire land in Maximo’s favor. Their signatures were procured by fraud because they were made to believe by Maximo and the lawyer who acted as notary public who “translated” the document, that the same was a deed of donation in Maximo’s favor covering one-half of their land. (It must be noted that the spouses are illiterate farmers).Although the document of sale stated a consideration of Five Hundred (P500.00) Pesos, the aforesaid spouses did not receive anything of value for the land.

In 1938, Maximo Mapalo, without the consent of the spouse, registered the sale in his favor. After thirteen years (1951), he sold the land to the Narcisos, who thereafter registered the sale and obtained a title in their favor. In 1952, the Narcisos filed a complaint with the CFI to be declared owners of the entire land, for possession of its western portion; for damages; and for rentals. The Mapalo spouses filed a counterclaim seeking cancellation of the the Narcisos’ titles as to the western half of the land. They said that their signatures to the deed of sale of 1936 was procured by fraud and that the Narcisos were buyers in bad faith.They also filed another complaint wherein they asked the court to declare deeds of sale of 1936 and of 1951 over the land in question be declared null and void as to the western half of said land.

CFI ruled in favor of the Mapalo spouses. Upon appeal filed by Narcisos, CA reversed the lower court’s ruling solely on the ground that the consent of the Mapalo spouses to the deed of sale of 1936 having been obtained by fraud, the same was voidable, not void ab initio, and, therefore, the action to annul the same, within four years from notice of the fraud, had long prescribed. (From March 15, 1938). Hence, this appeal.

Issues:
1. Whether the deed of absolute sale executed in 1936 was null and void.
2. Whether Narcisos were purchasers in good faith.

Held:

1st issue: YES, the sale was void.

The Civil Code governs the transaction because it was executed in 1936
Accordingly, since the deed of sale of 1936 is governed by the Old Civil Code, it should be asked whether its case is one wherein there is no consideration, or one with a statement of a false consideration. If the former, it is void and inexistent; if the latter, only voidable, under the Old Civil Code. There is lack of consideration
As observed earlier, the deed of sale of 1936 stated that it had for its consideration Five Hundred (P500.00) Pesos. In fact, however, said consideration was totally absent. The problem, therefore, is whether a deed which states a consideration that in fact did not exist, is a contract without consideration, and therefore void ab initio, or a contract with a false consideration, and therefore, at least under the Old Civil Code, voidable.

When there is no consideration, the contract is null and void.
According to Manresa, what is meant by a contract that states a false consideration is one that has in fact a real consideration but the same is not the one stated in the document.  A contract of purchase and sale is null and void and produces no effect whatsoever where the same is without cause or consideration in that the purchase price which appears thereon as paid has in fact never been paid by the purchaser to the vendor.

2nd issue: No, they were no purchasers in good faith.

Narcisos were not buyers in good faith. Aside from the fact that all the parties in these cases are neighbors, except Maximo Mapalo the foregoing facts are explicit enough and sufficiently reveal that the Narcisos were aware of the nature and extent of the interest of Maximo Mapalo their vendor, over the above-described land before and at the time the deed of sale in their favor was executed.

The Narcisos were purchaser-in-value but not purchasers in good faith.What was the necessity, purpose and reason of Pacifico Narciso in still going to the spouses Mapalo and asked them to permit their brother Maximo to dispose of the above-described land? To this question it is safe to state that this act of Pacifico Narciso is a conclusive manifestation that they (the Narcisos) did not only have prior knowledge of the ownership of said spouses over the western half portion in question but that they also have recognized said ownership. It also conclusively shows their prior knowledge of the want of dominion on the part of their vendor Maximo Mapalo over the whole land and also of the flaw of his title thereto. Under this situation, the Narcisos may be considered purchasers in value but certainly not as purchasers in good faith.

 

Case Brief: Villaflor vs. CA

VICENTE VILLAFLOR, substituted by his heirs, petitioner,
vs.
COURT OF APPEALS and NASIPIT LUMBER CO., INC., respondents.
G.R. No. 95694 October 9, 1997

Facts:

The Petitioner bought a large tract of land containing one hundred forty (140) hectares to four (4) different owners in 1940. The land was part of the public domain, but the petitioners predecessor in interest over which he acquired the property, have been in open, exclusive and notorious possession of the same for sometime. After acquisition, petitioner asserts exclusive rights thereof for more than fifty (50) years.

In 1946, petitioner entered into a lease agreement with respondent Nasipit Lumber Co.Inc. However, an “Agreement for the Relinquishment of Rights” was entered into by both parties in 1950. The respondent having complied all the requirements agreed upon, assumed ownership and possession of the property since then. Respondent corporation likewise filed a sales application in 1950 over the property to bolster his claim which the Bureau of Land otherwise granted on the same year as proof of an “Order of Award” issued.

In 1974 or twenty four (24) years had passed, when petitioner, questioned and made several collateral and extraneous claims against the respondent. However, the Bureau of Lands dismissed the claim, arguing that petitioner no longer has any substantial rights to question the validity of acquisition of the respondent and the subsequent issuance of free patent by the Bureau of Lands. Unperturbed, petitioner filed a motion for reconsideration at the Ministry of Natural Resources which likewise dismissed the petition.

On July 6, 1978, petitioner filed a complaint in the trial court for “Declaration of Nullity of Contract ( Deed of Relinquishment of Rights), Recovery of Possession (of two parcels of land subject of the contract), and Damages” at about the same time that he appealed the decision of the Minister of Natural Resources to the Office of the President. On January 28, 1983, petitioner died. Petitioner’s heir substituted in his behalf to pursue the claim. The trial court in Butuan City who initially take cognizance of the case ordered the case dismissed, on the grounds that: (1) petitioner admitted the due execution and genuineness of the contract and was estopped from proving its nullity, (2) the verbal lease agreements were unenforceable under Article 1403 (2) (e) of the Civil Code, and (3) his causes of action were barred by extinctive prescription and/or laches.

The heirs appealed to the CA which likewise rendered judgment of dismissal by upholding the lower court’s ruling.

ISSUE:

Whether or not the sale is valid.

HELD:

No. The provision of the law is specific that public lands can only be acquired in the manner provided for therein and not otherwise(Sec. 11, CA. No. 141, as amended). In his sales application, petitioner expressly admitted that said property was public land. This is formidable evidence as it amounts to an admission against interest. The records show that Villaflor had applied for the purchase of lands in question with this Office (Sales Application V-807) on 2 December 1948. There is a condition in the sales application to the effect that he recognizes that the land covered by the same is of public domain and any and all rights he may have with respect thereto by virtue of continuous occupation and cultivation are relinquished to the Government of which Villaflor is very much aware. It also appears that Villaflor had paid for the publication fees appurtenant to the sale of the land. He participated in the public auction where he was declared the successful bidder. He had fully paid the purchase price thereof. It would be a height of absurdity for Villaflor to be buying that which is owned by him if his claim of private ownership thereof is to be believed. The area in dispute is not the private property of the petitioner.

It is a basic assumption of public policy that lands of whatever classification belong to the state. Unless alienated in accordance with law, it retains its rights over the same as dominus. No public land can be acquired by private persons without any grant, express or implied from the government. It is indispensable then that there be showing of title from the state or any other mode of acquisition recognized by law. Such sales applicant manifestly acknowledged that he does not own the land and that the same is a public land under the administration of the Bureau of Lands, to which the application was submitted, all of its acts prior thereof, including its real estate tax declarations, characterized its possessions of the land as that of a “sales applicant”. And consequently, as one who expects to buy it, but has not as yet done so, and is not, therefore, its owner.

The rule on the interpretation of contracts (Article 1371) is used in affirming, not negating, their validity. Article 1373,which is a conjunct of Article 1371, provides that, if the instrument is susceptible of two or more interpretations, the interpretation which will make it valid and effectual should be adopted. In this light, it is not difficult to understand that the legal basis urged by petitioner does not support his allegation that the contracts to sell and the deed of relinquishment are simulated and fictitious. Simulation occurs when an apparent contract is a declaration of a fictitious will, deliberately made by agreement of the parties, in order to produce, for the purpose of deception, the appearance of a juridical act which does not exist or is different from that which was really executed. Such an intention is not apparent in the agreements. The intent to sell, on the other hand, is as clear as daylight. The fact, that the agreement to sell (7 December 1948) did not absolutely transfer ownership of the land to private respondent, does not how that the agreement was simulated. Petitioner‟s delivery of the Certificate of Ownership and execution of the deed of absolute sale were suspensive conditions, which gave rise to a corresponding obligation on the part of the private respondent, i.e., the payment of the last installment of the consideration mentioned in the Agreement. Such conditions did not affect the perfection of the contract or prove simulation Nonpayment, at most, gives the vendor only the right to sue for collection. Generally, in a contract of sale, payment of the price is a resolutory condition and the remedy of the seller is to exact fulfillment or, in case of a substantial breach, to rescind the contract under Article 1191 of the Civil Code. However, failure to pay is not even a breach, but merely an event which prevents the vendor‟s obligation to convey title from acquiring binding force.

The requirements for a sales application under the Public Land Act are: (1) the possession of the qualifications required by said Act (under Section 29) and (2) the lack of the disqualifications mentioned therein (under Sections 121, 122,and 123). Section 121 of the Act pertains to acquisitions of public land by a corporation from a grantee: The private respondent, not the petitioner, was the direct grantee of the disputed land. Sections 122 and 123 disqualify corporations, which are not authorized by their charter, from acquiring public land; the records do not show that private respondent was not so authorized under its charter.

Case Brief: Mate vs. CA and Tan

FERNANDO T. MATE 

vs.

THE HONORABLE COURT OF APPEALS and INOCENCIO TAN

G.R. No. 120724-25; May 21, 1998

Facts:

Josie Rey with Inocencio Tan went to the residence of Fernando Mate and solicited assistance to stave off her and her family’s prosecution for violation of B.P. 22 with the amount of 4,432,067.00. Josie even requested Fernando Mate to cede three lots that he owns to Inocencio in order to placate him. Fernando refused to accept the proposal of Josie and even contended that he owes Inocencio nothing to convey to him his properties and his lots were not for sale. However, Josie persisted and informed Fernando that she will redeem those lots through her own money. After a long discussion, they have agreed and even executed a fictitious deed of sale with right to repurchase. For assurance that Josie will redeem the lots, she issued two postdated checks to Fernando. After such act, the Deed of Sale with Right to repurchase was notarized and was given to Inocencio together with the titles of the properties. The transaction was not registered to the Registry of Deeds. Fernando deposited the checks to his account few days after the date in the checks but both of them were dishonored due to a closed account. From then on, Josie could no longer be found.

LOWER COURT’S RULING: The Regional Trial Court, during the trial the RTC court asked private respondent to file an action for consolidation of ownership of the properties subject of the sale and pursuant thereto he filed Civil Case No. 7587 that was consolidated with the case he filed earlier which were later decided jointly by the trial court in favor of private respondent.

APPELLATE COURT’S RULING: The Deed of Sale with Right of Repurchase executed October 6, 1986 valid and binding between plaintiff and defendant (as vendor and vendee-a-retro respectively); that as the period to redeem has expired, ownership thereof was consolidated by operation of law, and the Register of Deeds is hereby ordered to REGISTER this decision consolidating the defendant’s ownership over the properties covered by Transfer Certificate of Title No. T-90-71, covering Lot 8; Original Certificate of Title No. N-311 covering Lot 5370, all of the Tacloban Cadastre, and issuing to defendant Inocencio Tan his titles after cancellation of the titles presently registered in plaintiff Fernando T. Mate’s name and that of his wife. The plaintiff Fernando Mate is further ordered to pay defendant the sum of ONE HUNDRED FORTY THOUSAND (P140,000.00) PESOS, for and as attorney’s fees.

Issue:

Whether the Deed of Sale with Right to repurchase is valid.

Held:  

The Supreme Court affirmed the decision of the Court of Appeals. The Court stated that as admitted by petitioner, by virtue of the sale with pacto de retro, Josie Rey gave him, as vendor-a-retro, a postdated check in the amount of P1.4 Million, which represented the repurchase price of the two (2) lots. Aside from the P1.4 Million check, Josie gave another postdated check to petitioner in the amount of P420,000.00, ostensibly as interest for six (6) months but which apparently was his fee for having executed the pacto de retro document. Josie thus assumed the responsibility of paying the repurchase price on behalf of petitioner to private respondent. Unfortunately, the two checks issued by Josie Rey were worthless. Both were dishonored upon presentment by petitioner with the drawee banks. However, there is absolutely no basis for petitioner to file a complaint against private respondent Tan and Josie Rey to annul the pacto de retro sale on the ground of lack of consideration, invoking his failure to encash the two checks. Petitioner’s cause of action was to file criminal actions against Josie Rey under B.P. 22, which he did. The filing of the criminal cases was a tacit admission by petitioner that there was a consideration of the pacto de retro sale. Further, Petitioner then postulates that “it is not only illegal but immoral to require him to repurchase his own properties with his own money when he did not derive any benefit from the transaction.” Thus, he invokes the case of Singson vs. Isabela Sawmill, 88 SCRA 633, 643, where the Court said that “where one or two innocent persons must suffer, that person who gave occasion for the damages to be caused must bear consequences.” Petitioner’s reliance on this doctrine is misplaced. He is not an innocent person. As a matter of fact, he gave occasion for the damage caused by virtue of the deed of sale with right to repurchase which he prepared and signed. Thus, there is the equitable maxim that between two innocent parties, the one who made it possible for the wrong to be done should be the one to bear the resulting loss.

Case Brief: Rodriguez vs. COMELEC

EDUARDO T. RODRIGUEZ
vs.
COMELEC, BIENVENIDO O. MARQUEZ, JR.
G.R. No. 120099 July 24, 1996

 

Facts:

Petitioner Eduardo T. Rodriguez and private respondent Bienvenido O. Marquez Jr. (Rodriguez and Marquez, for brevity) were protagonists for the gubernatorial post of Quezon Province in the May 1992 elections. Rodriguez won and was proclaimed duly-elected governor. Marquez challenged Rodriguez’ victory via petition for quo warranto before the COMELEC, alleging that the latter has a pending case in LA, hence, a fugitive from justice and thus disqualified for the elective position.

Marquez Decision defined the term “fugitive from justice”, which includes not only those who flee after conviction to avoid punishment but likewise those who, after being charged, flee to avoid prosecution. This definition truly finds support from jurisprudence (. . .), and it may be so conceded as expressing the general and ordinary connotation of the term

In previous case, the issue of whether or not Rodriguez is a “fugitive from justice” under the definition thus given was not passed upon by the Court. That task was to devolve on the COMELEC upon remand of the case to it, with the directive to proceed therewith with dispatch conformably with the MARQUEZ Decision.

Rodriguez and Marquez renewed their rivalry for the same position of governor. This time, Marquez challenged Rodriguez’ candidacy via petition for disqualification before the COMELEC, based principally on the same allegation that Rodriguez is a “fugitive from justice.”

The COMELEC, allegedly having kept in mind the MARQUEZ Decision definition of “fugitive from justice”, found Rodriguez to be one. At any rate, Rodriguez again emerged as the victorious candidate in the May 8, 1995 election for the position of governor.

Marquez filed urgent motions to suspend Rodriguez’ proclamation which the COMELEC granted.

 

Issue:

Whether or not the COMELEC decision suspending Rodriguez is valid?

 

Held: No

The definition thus indicates that the intent to evade is the compelling factor that animates one’s flight from a particular jurisdiction. And obviously, there can only be an intent to evade prosecution or punishment when there is knowledge by the fleeing subject of an already instituted indictment, or of a promulgated judgment of conviction.

To elaborate, the same parties (Rodriguez and Marquez) and issue (whether or not Rodriguez is a “fugitive from justice”) are involved in the MARQUEZ Decision and the instant petition. The MARQUEZ Decision was an appeal (the Marquez’ quo warranto petition before the COMELEC). The instant petition is also an appeal although the COMELEC resolved the latter jointly (Marquez’ petition for the disqualification of Rodriguez). Therefore, what was irrevocably established as the controlling legal rule in the MARQUEZ Decision must govern the instant petition. And we specifically refer to the concept of “fugitive from justice” as defined in the main opinion in the MARQUEZ Decision, which highlights the significance of an intent to evade but which Marquez and the COMELEC, with their proposed expanded definition, seem to trivialize or undermine.

To re-define “fugitive from justice” would only foment instability in our jurisprudence when hardly has the ink dried in the MARQUEZ Decision.

To summarize, the term “fugitive from justice” as a ground for the disqualification or ineligibility of a person seeking to run for any elective local petition under Section 40(e) of the Local Government Code, should be understood according to the definition given in the MARQUEZ Decision

A “fugitive from justice” includes not only those who flee after conviction to avoid punishment but likewise those who, after being charged, flee to avoid prosecution.

Intent to evade on the part of a candidate must therefore be established by proof that there has already been a conviction or at least, a charge has already been filed, at the time of flight.

Not being a “fugitive from justice” under this definition, Rodriguez cannot be denied the Quezon Province gubernatorial post.