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MISTERIO v. CEBU STATE COLLEGE OF SCIENCE ANDTECHNOLOGY 

 June 23, 2005 |Calleja, Sr., J. | Pacto de Retro SaleDigester: Angat, Christine Jo !.

SUMMARY: Asuncion Sadaa"#isterio and Sudlon Agricultural$igh School entered into a Deed o% Sale o&er a 'arcel o% land. (hesale )as su*ject to Asuncion+s right to re'urchase the 'ro'ert

a%ter the high school shall ha&e ceased to eist, -R 2 shall ha&etrans%erred its site else)here. /n 13, P 42 )as enacted, )hichconsolidated &ocational schools, including SA$S, and ade thean etension o% CSCS(. /n 11, the heirs o% Asuncion )anted toeercise their right to redee the 'ro'ert, on the ground thatSA$S has ceased to eist. (he Court held that the action has'rescri*ed, as )hen there is no 'eriod 'ro&ided %or the eercise o% such right, the right to redee should *e eercised )ithin 4 ears%ro the ha''ening o% the allocated condition.

DOCTRINE: (he essence o% a pacto de retro sale is that title ando)nershi' o% the 'ro'ert sold is iediatel &ested in thevendee a retro, su*ject to the restricti&e condition o% re'urchase

* the vendor a retro )ithin the 'eriod 'ro&ided in Article 606 o%the 7e) Ci&il Code. (he %ailure o% the &endor a retro to re'urchasethe 'ro'ert &ests u'on the latter * o'eration o% la) the a*solutetitle and o)nershi' o&er the 'ro'ert sold.

FACTS:

• 152: (he Pro&incial oard o% Ce*u granted to Sudlon Agricultural $igh School 8SA$S, the usu%ruct o% 4 'arcels o%land co&ering 04.544 ha o% the anilad !riar 9ands state.

• Dece*er 3, 156: Asuncion Sadaa"#isterio eecuted aDeed o% Sale o&er a 'arcel o% land 8)hich )as also a 'art o% theanilad !riar 9ands state in %a&or o% SA$S. (he sale )assu*ject to the right o% #isterio to re'urchase the 'ro'ert a%ter the high school shall ha&e ceased to eist, -R 2 shallha&e trans%erred its site else)here.o (he right o% the &endor 8#isterio to re'urchase the

'ro'ert )as annotated at the dorsal 'ortion o% the (C(.• (he Pro&incial oard o% Ce*u, through a resolution, donated

the a%oreentioned 4 lots to SA$S, su*ject to 2 conditions:8 that i% SA$S ceases to o'erate, the o)nershi' o% the lands)ould autoaticall re&ert to the 'ro&ince, and 82 that SA$Scould not alienate, lease, or encu*er the 'ro'erties.

•  June 0, 13: .P. 42 )as enacted, )hich consolidated as

one school sste certain &ocational schools in the 'ro&ince

o% Ce*u, including SA$S, and )hich *ecae an etension o%the Ce*u State College o% Science and (echnolog 8CSCS(.

• Ce*u decided to reco&er the 4 lots it had earlier donated onthe ground that SA$S had no 'ersonalit to acce't thedonation. ;hen the heirs o% Asuncion #isterio, )ho had thendied intestate, learned that the 'ro&ince o% Ce*u )as tring toreco&er its donated 'ro'ert, the in%ored the 'ro&ince on August 1, 11 o% their intention to eercise their right to

re'urchase the 'ro'ert as sti'ulated in the Deed o% Sale.o (he 'ro&ince o% Ce*u and CSCS( settled their issue o&er

the lots * entering into a #eorandu o% Agreeent)here the lots )ere 'artitioned < 43 ha goes to the'ro&ince )hile 5 ha goes to the SA$S 8no) 'art o% theCSCS(.

• #arch 1, 110: (he #isterio heirs then sent a letter to CSCS(in%oring their intention to eercise the o'tion to re'urchase,on the ground that SA$S had ceased to eist.o CSCS( denied the clai, stating that SA$S still eisted,

al*eit it changed its nae =to CSCS(> and e'anded itso?erings =)hich no) included collegiate courses>.

• (he #isterio heirs then @led a co'laint *e%ore the R(C %or7ullit o% Sale andBor Rede'tion, alleging:o (hat SA$S had no juridical 'ersonalit o% its o)n at the

tie o% the sale, there%ore the sale )as null and &oido  And that assuing the sale )as &alid, the enactent o% P

42 a*olished SA$S and con&erted it to *ecoe 'art o%CSCS(, there%ore rendering the o'erati&e conditiongranting the &endor and her heirs the right to redee

•  A%ter the case+s 'reliinar con%erence, the trial court issued a're"trial order de@ning the issues:o ;hether SA$S has still retained its 'ersonalit as such

school or it had ceased to eisto ;hether the #isterio heirs ha&e the right to eercise the

right o% rede'tion o&er the 'ro'ert• R(C < ruled in %a&or o% the #isterio heirs

o (he sale *et)een Asuncion and SA$S is null and &oid %orlatter+s lac o% juridical 'ersonalit to acEuire real'ro'ert

o ;ith the enactent o% P 42, SA$S ceased to eist andto o'erate 8under the Cor'oration Code, the constituentcor'orations SA$S and CSCS( *ecae one througherger or consolidation, )ith CSCS( as the sur&i&ingentit, hence, the #isterio heirs can eercise their right

to redee

7/21/2019 75 - Misterio v Cebu State College of Science and Technology

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• (he -SF, re'resenting the CSCS(, a''ealed. Pending thea''eal, the CSCS(, through a Deed %or Re&ersion, deeded the'ro'ert to the 'ro&ince o% Ce*u.

• CA < re&ersed the R(Co (he R(C erred in not con@ning itsel% to the issues

de@ned * the 'arties during 're"trialo ;hile SA$S had ceased to eist )hen P 42 too e?ect,

the 'eriod %or the 'etitioners to re'urchase the 'ro'ert

e'ired on June 1G, %our ears a%ter the enactent o%P 42

• $ence, the 'resent 'etition * the #isterio heirs

RULING: Petition denied.

 Whether the actio to re!ee" the #ro#ert$ ha% #re%cri&e! ' YES.

• (he essence o% a pacto de retro sale is that title and o)nershi'o% the 'ro'ert sold is iediatel &ested in the vendee aretro, su*ject to the restricti&e condition o% re'urchase * thevendor a retro )ithin the 'eriod 'ro&ided in Article 606 o% the7e) Ci&il Code. (he %ailure o% the &endor a retro to re'urchasethe 'ro'ert &ests u'on the latter * o'eration o% la) thea*solute title and o)nershi' o&er the 'ro'ert sold.o  Art. 606. (he right re%erred to in Article 60, in the

a*sence o% an e'ress agreeent, shall last %our ears %rothe date o% the contract.Should there *e an agreeent, the 'eriod cannot eceedten ears.$o)e&er, the &endor a still eercise the right tore'urchase )ithin thirt das %ro the tie @nal judgent)as rendered in a ci&il action on the *asis that the contract)as a true sale )ith right to re'urchase

• /7 ($/S CAS: Asuncion 8&endor a retro and SA$S 8&endee aretro did not agree on an 'eriod %or the eercise o% the rightto re'urchase the 'ro'ert. Fo((o)i* Artic(e +,-, +/0 the%ai! ri*ht %ho1(! &e e2erci%e! )ithi 3o1r $ear% 3ro" theha##ei* o3 the a((ocate! co!itio contained in the deed:8a the cessation o% the eistence o% the SA$S, or 8* thetrans%er o% the school to other site.o /n this case, SA$S ceased to eist in June 0, 13, )hen

P 42 too e?ect. (he right o% the #isterio heirs, as thesuccessors"in"interest o% Asuncion 8&endor a retro, startedto run and lasted until June 0, 1G. $o)e&er, the#isterio heirs e'ressed their intention to redee the'ro'ert onl in 11.

• #isterio heirs contend that the issue o% )hether SA$S is et to*e resol&ed * court, hence the a''lica*le 'ro&ision is Article60683. (he contention is is'laced as their right tore'urchase the 'ro'ert )as not de'endent u'on the 'rior@nal inter'retation o% the said 'hrase. (here is no dou*t thatthe Deed o% Sale actuall includes a right to re'urchase. The3o1r4$ear #erio! 3or the #etitioer% to re#1rcha%e the

#ro#ert$ )a% ot %1%#e!e! "ere($ a! %o(e($ &eca1%ethere )a% a !iver*ece a% to the #reci%e "eai* o3 the#hra%e 5a3ter the SAHS %ha(( cea%e to e2i%t.6

• #oreo&er, the %act that the right to re'urchase the 'ro'ert isannotated in the dorsal side o% the R(C does not ean the saidright is i'rescri'ti*le. (he annotation )as onl %or the'ur'ose o% noti%ing third 'arties o% the 'etitioner+s right tore'urchase the 'ro'ert under the ters o% the deed o% sale,and the la).