Sales Case position

7/30/2019 Sales Case position

1/3

EN BANC

DECISION

March 13, 1947

GR No. L-238 SUNDAY ORDONEZ , plaintiff-appellee, vs.. ARTURO Villaromn , defendant-

appellant.

D. Teodoro M. Santiago in representation of appellant.

D. Vivencio M. Ruiz appellee's representation.

Paul, J. :

Florentino Ordoez, brother of the plaintiff, on March 26, 1941 sold for P1, 300 to Arturo Villaroman

the land described in paragraph 2 of the application, reserving the right to repurchase within a period

of three years from the date of grant of the writing. On several occasions the plaintiff - brother of the

seller - attempt to repurchase the land for P1, 200 and as the defendant does not settle, the plaintiff

Escribania consign in the Court of First Instance of Nueva Ecija the amount of P1, 200 "as complete

payment and satisfaction of all liability due to the defendant, "as I argue in their lawsuit filed March 6,

1944.

Considering the brother of the plaintiff as a single debtor, the lower court condemned the defendant,

according to the provisions of Article 1158 of the Civil Code, to withdraw from the court Escribania the

amount appropriated for P1, 200 and grant writing for resale the plaintiff. Against this decision the

defendant appealed.

It is not difficult to discern the loan contract of the sale contract with retro pact. In the first, the lendergives money to the debtor, committing itself to pay within the agreed time. In the second, (1) no

delivery of money, which is the purchase price by the buyer to the seller, (2) there is transmission of

property or ownership of the land sold, and (3) the seller to repurchase reserves within the agreed .In

the first case, the debtor has no choice: their only obligation is to pay. In the second case, the seller

tieneuna real alternative: retractoo exercise the right not, according, he pleases, has no obligation,

but right - you can renounce: to retract. In the first case, the debtor can pay the debt himself or a

third party, on the, "whether or not complimiento interest on the obligation, and knows and approves,

or longer ignore it." (Article 1158, Cod Civ) In the second case, only the seller is entitled to exercise

the redemption in accordance with the agreement. "When several together ye ne a single contract to

sell a property undivided retro pact, none of them may exercise this right more than for their respectiveparts. The same was observed siel has sold a farm alone has left several heirs, in which case each of

these may only redeem the part habiese acquired. "(Article 1514, Code Civ)

In writing Exhibit A, the seller reserve itself (reserved for himself) that right and their heirs or

cesionaries. The claimant is heir, agent or assignee of the seller. Therefore can not exercise a right

that is unique to the seller.


2/3

It is true that in some cases, the lender under the subterfuge of the sale with retro pactgrants a low

interest loan usurious. Other times, under the guise of a generous loan some get the execution of a

deed of sale with retro pact. Such cases are the product ofbad faith , fraud or excessive ambition of

getting rich.

Erro the lower court to consider what actually loan was a purchase with retro pact.

In support of this decision, the respondent invoked against Lim Guinto issue Bonfing (48 Phil. 933),

which is inapplicable because in that case the buyer did not object to the repurchase, on the contrary

it allowed. In that case not decided if a stranger could buy back a lot of the area burned in Cebu

soldretro pact. What was resolved was: whether the widow Lim money that rescued the batch Bonfing

was primitive property of her husband before her marriage contract, it acquired all "as well on your

own and absolute right." This Court resolved that: declare that the children of the deceased husband

are owners Abendan four-fifths of the bare ownership and the last fifth of the lot and only acquired the

widow in the repurchase right of usufruct over a fifth, and Bonfing Lim who was the owner of the

money, could not get the whole lot repurchased but only the right that had the widow, that is, the

usufruct of the fifth.The issue of Sison against Balgos (34 Phil. 932) is not applicable because Leodegarius Azarraga, uncle

of minors, appointed special administrator of the decedent's probate Azarraga Isidro was guardian for

minors and Jesus Maria Felisa Bellosillo a day after having entered the amount of P141.12 held by the

Sheriff to retract the estate of minors, was required under the Article 702 of the Law of Civil

Prodedimiento to engage, exercising the rights of the deceased, all trials in which the action does not

expire at the death of the person concerned, necessary to recover property or to protect the rights of

the deceased, and one of these actions that do not expire for decedent's death, is the action to regain

control and possession of property (Article 703, Code. Proc. Civ). The redemption exercised by the

special administrator is unconventional, but legal. The article 465 of the Code of Civil Procedure clearly

states that you can retract the property sold at public auction is the "judgment debtor or hissuccessors." Leodegarius The action of Azarraga to deposit the amount of P141.12 one day before be

appointed administrator agrees with the law (1) because it was to redeem the property sold at public

auction on the occasion of an order of execution for debt, and (2) because Leodegarius Azarraga acted

on behalf of his nephews, sucesoresdel deceased debtor .

The issue of Gonzaga against Garcia (27 Phil. 8), is completely adverse to appellee's theory. This

Court said quote: "Del Rosario was not debtor. I did not have any obligation to retract the ground of

the power of Martin. Was entitled to, but which exercised this right or not depended on their own

will.The 1158 article is not, for these reasons apply. "

The issue of Cristobal against Gomez (50 Phil. 846), also supports the theory of the plaintiff. In that

case the brothers Marcelino and Telesfora repurchased by Luis R. Gomez Yangco the land sold

withretro pactby Epifanio Gomez with capital provided by Bibiano Banas, on the understanding that the

land had to be so repurchased administered by Marcelino Gomez and depues all capital paid in

advance by Bibiano Banas, goods entregaria seller. Not applicable here because Luis R. Yangco did not

oppose the resale of goods, on the contrary, resold, and this Court, as in the case of Martinez against

Grao (42 Jur Phil., 37), stated that "a person who, before the consolidation dominance in the


3/3

purchaser under a sales contract with retro pact, agreed with vendors in purchasing the property and

manage it until you have paid all debts which are a lien on it, after which the goods will be returned to

the original owner, is bound by this agreement, and, to buy goods in these circumstances, such a

person becomes, in effect, a trustee, and is obliged to administer the assets in this concept. The same

principle applies to this case. "Plaintiff in the present case not repurchased the ground in his brother

seller representation: pedia in its application that the defendant be ordered to grant a deed of resale

in its favor.

The conventional redemption is not a right created by operation of law, but under an express contract,

which is private law between the parties (Article 1281, Code Civ). If its terms are clear and not false

or contested rebuked his authenticity, will be the literal meaning of its clauses. (Feliciano against

Limjuco, 41 Phil. 156; Masongsong against Kalaw, 55 Phil. 845.)

Moreover, the plaintiff only Escribania consign in the amount of P1, 200 and the sale price pact retroera

of P1, 300. The amount appropriated therefore not enough to force the defendant to sell the

land. Article 1507 of the Civil Code which provides that the right to repurchase the thing sold has the

"obligation to comply as stated in the 1518 article," in which expressly provides that "the seller may

not exercise the right of withdrawal without reimburse the buyer in the sale price. "By default,

therefore, the provisions of the cited articles, the plaintiff even assuming she was entitled to exercise

the redemption conventional could not compel the defendant to To grant writing resale.

It reverses the judgment with costs against the plaintiff.

Moran, CJ, Paras, Feria, Perfect, Yarn, Bengzon, and Briones, MM., Are satisfied.

Tuason, J., concurs in the result.

Documents

Sales Case position