1.

Pineda case Since the Spouses Benitez were the undisputed owners of the Property, they could validly sell and deliver the Property to Mojica. The execution of the notarized deed of sale between the Spouses Benitez and Mojica had the legal effect of actual or physical delivery. Ownership of the Property passed from the Spouses Benitez to Mojica.[24] The nullity of the second owners duplicate of TCT 8361 did not affect the validity of the sale as between the Spouses Benitez and Mojica. 2. Heirs of San Andres v Tria Facts: Juan Andres was the owner of the lot situated in liboton, naga city. The sale was evidenced by a deed of sale. Upon the death of juan andres, ramon san andres was appointed as administrator of the estate, and hired geodetic engineer. Jose panero prepared a consolidated plan of the estate and also prepared a sketch plan of the lot sold to respondent. It was found out that respondent had enlarged the area which he purchased from juan. The administrator sent a letter to the respoindent to vacate the said portion in which the latter refused to do. Respondent alleged that apart from the original lot, which had been sold to him, the latter likewise sold to him the following day the remaining portion of the lot. He alleged that the payment for such would be affected in 5 years from the execution of the formal deed of sale after a survey is conducted. He also alleged that under the consent of juan, he took possession of the same and introduced improvements thereon. Respondent deposited in court the balance of the purchase price amounting to P7,035.00 for the aforesaid 509-square meter lot. On September 20, 1994, the trial court rendered judgment in favor of petitioner. It ruled that there was no contract of sale to speak of for lack of a valid object because there was no sufficient indication to identify the property subject of the sale. Hence, the need to execute a new contract. Respondent appealed to the Court of Appeals, which on April 21, 1998 rendered a decision reversing the decision of the trial court. The appellate court held that the object of the contract was determinable, and that there was a conditional sale with the balance of the purchase price payable within five years from the execution of the deed of sale. Issue: whether or not there was a valid sale. Held: Civil Code provides that By the contract of sale, one of the contracting parties obligates himself to transfer the ownership of and to deliver a determinate thing, and the other to pay therefor a price certain in money or its equivalent. A contract of sale may be absolute or conditional. As thus defined, the essential elements of sale are the following: 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. As shown in the receipt, dated September 29, 1964, the late Juan San Andres received P500.00 from respondent as "advance payment for the residential lot adjoining his previously

paid lot on three sides excepting on the frontage; the agreed purchase price was P15.00 per square meter; and the full amount of the purchase price was to be based on the results of a survey and would be due and payable in five (5) years from the execution of a deed of sale. Petitioner's contention is without merit. There is no dispute that respondent purchased a portion of Lot 1914-B-2 consisting of 345 square meters. This portion is located in the middle of Lot 1914-B-2, which has a total area of 854 square meters, and is clearly what was referred to in the receipt as the "previously paid lot." Since the lot subsequently sold to respondent is said to adjoin the "previously paid lot" on three sides thereof, the subject lot is capable of being determined without the need of any new contract. The fact that the exact area of these adjoining residential lots is subject to the result of a survey does not detract from the fact that they are determinate or determinable. As the Court of Appeals explained: Concomitantly, the object of the sale is certain and determinate. Under Article 1460 of the New Civil Code, a thing sold is determinate if at the time the contract is entered into, the thing is capable of being determinate without necessity of a new or further agreement between the parties. Here, this definition finds realization. Thus, all of the essential elements of a contract of sale are present, i.e., that there was a meeting of the minds between the parties, by virtue of which the late Juan San Andres undertook to transfer ownership of and to deliver a determinate thing for a price certain in money. As Art. 1475 of the Civil Code provides: The 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. . . .That the contract of sale is perfected was confirmed by the former administrator of the estates, Ramon San Andres, who wrote a letter to respondent on March 30, 1966 asking for P300.00 as partial payment for the subject lot. As the Court of Appeals observed: Without any doubt, the receipt profoundly speaks of a meeting of the mind between San Andres and Rodriguez for the sale. Evidently, this is a perfected contract of sale on a deferred payment of the purchase price. All the prerequisite elements for a valid purchase transaction are present. There is a need, however, to clarify what the Court of Appeals said is a conditional contract of sale. Apparently, the appellate court considered as a "condition" the stipulation of the parties that the full consideration, based on a survey of the lot, would be due and payable within five (5) years from the execution of a formal deed of sale. It is evident from the stipulations in the receipt that the vendor Juan San Andres sold the residential lot in question to respondent and undertook to transfer the ownership thereof to respondent without any qualification, reservation or condition. A deed of sale is considered absolute in nature where there is neither a stipulation in the deed that title to the property sold is reserved in the seller until full payment of the price, nor one giving the vendor the right to unilaterally resolve the contract the moment the buyer fails to pay within a fixed period. Applying these principles to this case, it cannot be gainsaid that the contract of sale between the parties is absolute, not conditional. There is no reservation of ownership nor a stipulation providing for a unilateral rescission by either party. In fact, the sale was consummated upon the delivery of the lot to respondent. Thus, Art. 1477 provides that the ownership of the thing sold shall be transferred to the vendee upon the actual or constructive delivery thereof. The stipulation that the "payment of the full consideration based on a survey shall be due and payable in five (5) years from the execution of a formal deed of sale" is not a condition which affects the efficacy of the contract of sale. It merely provides the manner by which the full consideration is to be computed and the time

within which the same is to be paid. But it does not affect in any manner the effectivity of the contract. Consequently, the contention that the absence of a formal deed of sale stipulated in the receipt prevents the happening of a sale has no merit. The claim of petitioners that the price of P7,035.00 is iniquitous is untenable. The amount is based on the agreement of the parties as evidenced by the receipt (Exh. 2). Time and again, we have stressed the rule that a contract is the law between the parties, and courts have no choice but to enforce such contract so long as they are not contrary to law, morals, good customs or public policy. Otherwise, court would be interfering with the freedom of contract of the parties. Simply put, courts cannot stipulate for the parties nor amend the latter's agreement, for to do so would be to alter the real intentions of the contracting parties when the contrary function of courts is to give force and effect to the intentions of the parties. The decision of the Court of Appeals is AFFIRMED with the modification that respondent is ORDERED to reimburse petitioners for the expenses of the survey. 3. Schuback v Sons Phil Trading FACTS: SJ Industrial, through Ramon San Jose, approached Schuback & Sons Phil. Trading (SSPT) to purchase bus spare parts. He submitted the list of parts he wanted and SSPT coordinated with its Germany Office to quote the prices, and forwarded its formal offer to SJ Industrial, containing the prices, item numbers, descriptions, etc. SJ informed SSPT of his desire to purchase such items and promised to submit the quantity per unit. SJ then submitted such quantities needed to SSPTs GM, Mr. Reichert. San Jose indicated the same in the Purchase Order with the inscription this will serve as our initial purchase order. PO will include 3% discount. SSPT immediately ordered the products from Germany to avail of the old prices partial deliveries of which were made. Then, for his failure to secure letters of credit, SJ failed to purchase the same and alleged that there was no perfected contract of sale. Thus, SSPT sought damages. ISSUE: W/N there was a perfected contract of sale HELD: YES. Quantity is immaterial in the perfection of a contract of sale. What is important is the meeting of the minds as to the object and cause of the sale. There was already a meeting of the minds in this case from the moment SJ manifested that he will order the parts, although he will communicate quantities later on. In fact, he indeed communicated such needed quantities this goes to the execution of the contract of sale already. By ordering the parts, SJ acceded to the prices offered by SSPT. On the other hand, SSPT acceded to SJs request for discount by immediately ordering the parts. SJ Industrial is thus liable for damages 4. Noel v CA In a contract of sale, it is essential that the seller is the owner. FACTS: (Quiason, J.)PETITIONS for review on certiorari of a decision of the Court of Appeals.Gregorio Nanaman and Hilaria Tabuclin (Nanaman spouses) were a childless,legally-

married couple. Gregorio, however, had a child named Virgilio Nanaman(IC) by another woman. Since he was two years old, Virgilio was reared byGregorio and Hilaria. He was sent to school by the couple until he reached thirdyear of the law course.During their marriage, Gregorio and Hilaria acquired certain property including a34.7-hectare land in Tambo, Iligan City on which they planted sugarcane, corn andbananas. They also lived there with Virgilio and 15 tenants. On October 2, 1945,Gregorio died. Hilaria then administered the property with the help of Virgilio. Through their tenants, Hilaria and Virgilio enjoyed the produce of the land to theexclusion of Juan Nanaman, the brother of Gregorio, and Esperanza and Caridad Nanaman, Gregorio's daughters by still another woman. In 1953, Virgilio (IC)declared the property in his name for taxation purposes. On November 1, 1952,Hilaria and Virgilio, mortgaged the 34.7hectare land in favor of private respondent, in consideration of the amount of P4,800.00.On February 16, 1954, Hilaria and Virgilio executed a deed of sale over the sametract of land also in favor of private respondent in consideration of the sum of P16,000.00. Witnesses to the sale were the wife of Virgilio, Rosita S. Nanaman,Rufo C. Salas, the driver of private respondent, and Remedios Pilotan. The taxdeclaration in the name of Virgilio was cancelled and a new tax declaration wasissued in the name of private respondent, Jose Deleste. Having discovered thatthe property was in arrears in the payment of taxes from 1952, privaterespondent paid the taxes for 1952, 1953 and 1954. From then on, privaterespondent has paid the taxes on the property.On May 15, 1954, Hilaria died. On October 27, 1954, Esperanza and Caridad Nanaman filed intestate estate proceedings concerning the estate of their father,Gregorio. Included in the list of property of the estate was the 34.7-hectare land. Inasmuch as only Esperanza, Caridad and Virgilio Nanaman were named as heirs of Gregorio in the petition, Juan Nanaman, Gregorio's brother, opposed it. OnNovember 26, 1954, the petition was amended to include the estate of Hilaria with Alejo Tabuclin, Hilaria's brother, and Julio Tabuclin, (nephew)a son of Hilaria's deceased brother, Jose, as additional petitioners. Having been appointed special administrator of the estate of the Nanaman couple, Juan Nanaman included the 34.7-hectare land in the list of the assets of the estate. Juan also reported that Virgilio took the amount of P350.00 from the produce of the estate without prior permission and that five tenants delivered sugar and palay to private respondent. Hence Juan prayed that the court cite private respondent and the tenants in contempt of court. Accordingly, in its Order of January 30, 1956, the probate court required private respondent and said tenants to appear before it and "show cause why they should not be cited for contempt for illegally interfering in the land" under special administration.On June 16, 1956, when Edilberto Noel took over as regular administrator of the estate, he was not able to take possession of the land in question because it wasin the possession of private respondent and some heirs of Hilaria. Later, Privaterespondent and the heirs of the Nanaman spouses executed an amicablesettlement of the Nanaman estate. In the document, private respondent agreed"to relinquish his rights to one-half (1/2) of the entire parcel of land in Tambo,Iligan City, indicated in item 1 under the Estate, sold to him by Hilaria Tabuclin, infavor of all the heirs of the abovementioned intestate *estate+ for the reason thatnot all of the heirs of Gregorio Nanaman have signed and agreed. The courtapproved the amicable settlement but when it was questioned by some heirs, thecourt set aside its approval and declared it null and void.Noel, as regular administrator, and as ordered by the court filed an action againstprivate respondent for the reversion of title over

the 34.7-hectare land to theNanaman estate and to order private respondent to pay the rentals and attorney'sfees to the estate. RTC : action for annulment of the deed of sale had prescribed in 1958 inasmuch as the sale wasregistered in 1954 and that Gregorio's heirs had slept on their rights by allowing Hilaria toexercise rights of ownership over Gregorio's share of the conjugal property after his death in1945. On the issue that Hilaria had no authority to dispose of one-half of the property pertainingto her husband, the trial court ruled: (1) that Hilaria in effect acted as administratrix over theestate of Gregorio; (2) that she sold the 34.7- hectare land in order to pay the debts of theconjugal partnership; and (3) that out of the purchase price of P16,000.00, P4,000.00 was inpayment to private respondent (who was a doctor of medicine) for medical services renderedand medicine administered during Gregorio's ailment and P800.00 was used to pay taxes inarrears. Noel appealed. CA: the transaction between Hilaria and Virgilio on one hand and private respondent on theother, was indeed a sale. It found that no fraud, mistake or misrepresentation attended in the execution of the deed of sale and that no proof was shown that the contract was merely a mortgage. The appellate court, however, agreed with Noel that Hilaria could not validly sell the 37.7-hectare land because it was conjugal property, and Hilaria could sell only her one-half sharethereof.On the issue of prescription, the appellate court ruled that since no fraud, mistake ormisrepresentation attended the execution of the deed of sale, the prescriptive period of tenyears had not yet elapsed when the action to recover the property was filed in 1963. Moreover,the appellate court held that in the absence of proof of adverse possession by Hilaria, sheshould be considered as holding the property pursuant to her usufructuary rights over the sameunder the provisions of the Spanish Civil Code of 1889, the law in force at the time of the deathof Gregorio.Finding that Noel's claim for rentals of P5,000.00 per annum from 1957 was uncontroverted, theappellate court ruled that one-half thereof belonged to the estate of Gregorio. CA AMENDED DECISION: affirmed its previous decision regarding the due execution of the Deed of Sale adding that since no fraud attended its execution, there was no basis for theaction to annul the sale, and therefore there was no starting point in reckoning the prescriptiveperiod of four years. It reconsidered the Decision of Feb. 18, 1980 insofar as it declared Delesteand the estate of Gregorio as co-owners of the said land. The appellate court tacked "the physical possession of Hilaria and Virgilio to the possession of the defendant for another nine (9) years up to the time the complaint was filed." It consideredthe "change of conditions or relations" which had

transpired in the case such as privaterespondent's registration of his muniment of title over the property; the cancellation of Virgilio'stax declaration and the issuance of another tax declaration in the name of private respondent;private respondent's payment of taxes from 1952 "up to the present;" the execution of a newtenancy agreement between private respondent and the tenants; and private respondent'spurchase of plows, a carabao and insecticides for use in the ricefield.Stating that it was "proscribed from taking away property from the alert and the industrious anddumping it into the hands and possession of one has previously slept on his rights," theappellate court affirmed the decision of the lower court in all its parts, including the award of damages and the costs of suit. ISSUE : W/N Hilaria and Virgilio could dispose of the entire property sold to private respondentand assuming that they did not have full ownership thereof, whether the right of action torecover the share of the collateral heirs of Gregorio had prescribed or been lost through laches. HELD: NO. Gregorio died in 1945 long before the effectivity of the Civil Code of the Philippines on August 30, 1950. Under Article 2263 of the said Code, "rights tothe inheritance of a person who died, with or without a will, before the effectivityof this Code, shall be governed by the Civil Code of 1889, by other previous laws,and by the rules of Court." Thus, succession to the estate of Gregorio was governed primarily by theprovisions of the Spanish Civil Code of 1889. Under Article 953 thereof, a spouselike Hilaria, who is survived by brothers or sisters or children of brothers or sistersof the decedent, as is obtaining in this case, was entitled to receive in usufructthe part of the inheritance pertaining to said heirs. Hilaria, however, had fullownership, not merely usufruct, over the undivided half of the estate (SpanishCivil Code of 1889, Art. 493). It is only this undivided half-interest that she couldvalidly alienate.On the other hand, Virgilio was not an heir of Gregorio under the Spanish CivilCode of 1889. Although he was treated as a child by the Nanaman spouses,illegitimate children who were not natural were disqualified to inherit under thesaid Code (Cid v. Burnaman, 24 SCRA 434 [1968]). Article 998 of the Civil Code of the Philippines, which gave an illegitimate child certain hereditary rights, couldnot benefit Virgilio because the right of ownership of the collateral heirs of Gregorio had become vested upon his death (Civil Code of the Philippines, Art.2253; Uson v. Del Rosario, 92 Phil. 530 [1953]). Therefore, Virgilio had no right atall to transfer ownership over which he did not own.In a contract of sale, it is essential that the seller is the owner of the property heis selling. The principal obligation of a seller is "to transfer the ownership of" theproperty sold (Civil Code of the Philippines, Art. 1458). This law stems from theprinciple that nobody can dispose of that which does not belong to him (Azcona v.Reyes, 59 Phil. 446 [1934]; Coronel v. Ona, 33 Phil. 456 [1916).

NEMO DAT QUADNON HABET .While it cannot be said that fraud attended the sale to private respondent, clearlythere was a mistake on the part of Hilaria and Virgilio in selling an undividedinterest in the property which belonged to the collateral heirs of Gregorio. The sale, having been made in 1954, was governed by the Civil Code of thePhilippines. Under Article 1456 of said Code, an implied trust was created on theone-half undivided interest over the 34.7-hectare land in favor of the real ownersUnder the law in force in 1945, the surviving spouse was given the managementof the conjugal property until the affairs of the conjugal partnership wereterminated. The surviving spouse became the owner of one-half interest of theconjugal estate in his own right. He also became a trustee with respect to theother half for the benefit of whoever may be legally entitled to inherit the saidportion. "He could therefore no more acquire a title by prescription against thosefor whom he was administering the conjugal estate than could a guardian hisward or a judicial administrator against the heirs of an estate. . . . The survivinghusband as the administrator and liquidator of the conjugal estate occupies theposition of a trustee of the highest order and is not permitted by the law to holdthat estate or any portion thereof adversely to those for whose benefit the law imposes upon him duty of administration and liquidation" (Pamittan v. Lasam, 60Phil. 908 [1934]). The possession of Virgilio, his registration of the land in his name for taxpurposes, his hiring of tenants to till the land, and his enjoyment of the produce of the tenants, appear more as acts done to help Hilaria in managing the conjugalproperty. There is no evidence to prove indubitably that Virgilio asserted a claimof ownership over the property in his own right and adverse to all includingHilaria.

5. Arra Realty Corp. v. Guaranty Corp.

FACTS: Arra Realty Corporation (ARC) owner of a parcel of land, decided to construct a five-storey building on its property and engaged the services of Eng. Pealoza as project and structural engineer. Pealoza and the ARC agreed on November 18, 1982 that Pealoza would share the purchase price of one floor of the building, consisting of 552 square meters for the price of P3,105,838: P901,738, payable within sixty (60) days from November 20, 1982, and the balance payable in twenty (20) equal quarterly installments of P110,205. Sometime in May 1983, Pealoza took possession of the 2nd flr (the property she bought), where she put up her office and operated her school. Unknown to her, ARC had executed a real estate mortgage over the lot and the entire building in favor of the China Banking Corporation as security for a loan on May 12, 1983. From February 23, 1983 to May 31, 1984, Pealoza paid P1,175,124.59 for 2nd flr she had purchased. After discovering that the property had been mortgaged to Bank, she stopped paying the installments due on the purchase price of the property. She then inform ARC that China Banking Corp rejected her offer to assume its equivalent loan from the bank and reminded it that it had conformed to her proposal to assume the payment of its loan from the bank up to the equivalent amount of the balance of the purchase price of the second floor of the building as agreed upon, and the consequent execution by the ARC of a

deed of absolute sale over the property in her favor. In the meantime that ARC has not issued her the title, she withheld her payments. Oct. 3, 1984, Pealoza transferred the school to another building she had purchased, but retained her office therein. She later discovered that her office had been padlocked. She had the office reopened and continued holding office thereat. To protect her rights as purchaser, she executed on Nov. 26, 1984 an affidavit of adverse claim over the property which was annotated at the dorsal portion of TCT No. 112269 on Nov. 27, 1984 however, the adverse claim was cancelled on Feb. 11, 1985. ARC failed to pay its loan to China Banking Corporation, the subject property was foreclosed, thereafter sold to the Bank. On Apr. 29, 1987, ARC and Guarantee Development Corporation and Insurance Agency (GDCIA) executed a deed of conditional sale covering the building and the lot for P22,000,000. With the money advanced by the GDCIA, the property was redeemed. SALES | SANCHEZ | 16 On May 14, 1987, ARC executed a deed of absolute sale over the lot and building in favor of the GDCIA for P22,000,000. The Register of Deeds, thereafter, issued TCT in favor of the GDCIA over the property without any liens or encumbrances. Pealoza then filed a complaint against ARC & GDCIA for specific performance to execute a deed of sale of the second floor of the building in her for OR sum of money.ARC and GDCIA filed its defenses and counter-claims as well. RTC: Granted the award of sum of money and ordered ARC to pay Pealoza BUT dismissed the specific performance on grounds that the TCT was already issued in the name of GUARANTEE; dismissed ARC & GDCIAs counterclaim for insufficiency of evidence. CA: Affirmed RTC decision ISSUE: 1. W/N there was perfected contract of sale exists bet. Arra Realty and Eng. Pealoza, despite the failure of Eng. Pealoza to pay the balance of purchase price? YES there is a perfected contract of sale. RATIO: ARC (seller) s Argument Supreme Court No contract of sale over the one floor of the building was perfected. Eng. Pealoza (buyer) failed to pay the down payment on its due date on Jan 1983. It was only on Mar. 4, 1983 that the

buyer was able to pay and buyer was only able to pay 3 quarterly instalments and a part of 4th instalment. Pealoza failed to pay for rentals for her occupancy of the property in the total amount of P2,177,935. The petitioners contend that, even if the payments of respondent Pealoza amounting to P1,735,500 would be deducted from the agreed purchase price, she would still end up owing the petitioner ARC the net amount of P930,815.56. They aver that respondent Pealoza should be ordered to pay damages under Article 19 CC In May 1983, Pealoza took possession of a portion of the second floor, she put up her office and operated the St. Michael International Institute of Technology. Thenceforth, respondent Pealoza became the owner of the property, conformably to Article 1477 CC until and unless the contract is resolved or rescinded in accordance with law, seller cant recover the thing sold even if the vendee failed to pay in full the initial payment for the property. Such failure will merely give the vendor the option to rescind the contract of sale judicially or by notarial demand as provided for by Article 1592 CC. In the sale of immovable property, even though it may have been stipulated that upon failure to pay the price at the time agreed upon the rescission of the contract shall of right take place, the buyer may pay, even after the expiration of the period, as long as no demand for rescission of the contract has been made upon him either judicially or by a notarial act. Admittedly, buyer Pealoza failed to pay the downpayment on time. But then, the petitioner ARC accepted, without any objections, the delayed payments of the respondent; hence, as provided in Article 1235 CC the obligation of the respondent is deemed complied with: Art. 1235. When the obligee accepts the performance, knowing its incompleteness or irregularity, and without expressing any protest or objection, the obligation is deemed fully complied with. Buyer was justified in withholding her payment because when she asked for the issuance of her title to the property after taking possession thereof, the ARC failed to comply. Even

before she took possession of the property, the petitioner ARC had already mortgaged the lot and the building to the China Banking Corporation; when she offered to pay the balance of the purchase price of the property to enable her to secure her title thereon, the petitioner ARC ignored her offer. Under Article 1590 CC, a vendee may suspend the payment of the price of the property sold: Art. 1590. Should the vendee be disturbed in the possession or ownership of the thing acquired, or should he have reasonable grounds to fear such disturbance, by a vindicatory action or a foreclosure of mortgage, he may suspend the payment of the price until the vendor has caused the disturbance or danger to cease, unless the latter gives security for the return of the price in a proper case, or it has been stipulated that, notwithstanding any such contingency, the vendee shall be bound to make the payment. A mere act of trespass shall not authorize the suspension of the payment of the price. The petitioner ARC is, thus, barred from raising the claim that respondent Pealoza is liable for P2,177,935 by way of advances and unpaid rentals ARC did not interpose any counterclaims for actual damages in the form of unpaid rentals nor it was only when they moved for the reconsideration of the decision of the CA did they claim, for the first time on appeal. Likewise they cant claim on the basis of Art 19 CC Pealoza while she failed to pay the purchase price on time, the petitioner ARC nevertheless accepted such delayed payments. The respondent even proposed to assume the loan of ARC with the China Banking Corp. in an amount equivalent to the balance of the purchase price of the subject property, which the petitioner ARC rejected. In fine, respondent Pealoza acted in accord with law and in utmost good faith. Hence, she is not liable for damages to the petitioners under Article 19 of the New Civil Code. 6. Mascuana v CA Heirs of Jesus Mascunana v. CA(March)Facts of the Case Masunana bought a parcel of land from the Wuthrich siblings. Part of which Mascunana, he later sold to Sumilhig.The contract price is 4,690 with 3,690 as down payment. Their agreement says:That the balance of ONE THOUSAND PESOS (P1,000.00) shall be paid by the VENDEE unto the VENDOR assoon as the above-portions of Lot 124 shall have been surveyed in the name of the VENDEE

and all paperspertinent and necessary to the issuance of a separate Certificate of Title in the name of the VENDEE shall havebeen prepared.Sumilhig later sold the same lot to Layumas. Years after, Layumas wrote to the heirs of Mascunana(since Mascunana died already) offering to pay the 1,000 balance of the purchase price of the property. Theaddressee, however, refused to receive the mail matter.Heirs Mascunana then filed a complaint for recovery of possession against Barte ( an individual whomLayumas allowed to stay on the subject property). Issue : WON the contract of alienation of the subject lot in favor of Sumilhig was a contract to sell or a contract ofsale Held : Sale Article 1458 of the New Civil Code provides:By the contract of sale, one of the contracting parties obligates himself to transfer the ownership of and to delivera determinate thing, and the other to pay therefor a price certain in money or its equivalent.A contract of sale may be absolute or conditional.Thus, there are three essential elements of sale, to wit:a) Consent or meeting of the minds, that is, consent to transfer ownership in exchange for the price;b) Determinate subject matter; andc) Price certain in money or its equivalent.In this case, there was a meeting of the minds between the vendor and the vendee, when the vendorundertook to deliver and transfer ownership over the property covered by the deed of absolute sale to the vendeefor the price of P4,690.00 of which P3,690.00 was paid by the vendee to the vendor as down payment. Thevendor undertook to have the property sold, surveyed and segregated and a separate title therefor issued in thename of the vendee, upon which the latter would be obliged to pay the balance of P1,000.00. There was nostipulation in the deed that the title to the property remained with the vendor, or that the right to unilaterallyresolve the contract upon the buyers failure to pay within a fixed period was given to such vendor. Patently, thecontract executed by the parties is a deed of sale and not a contract to sell. As the Court ruled in a recent case:In Dignos v. Court of Appeals (158 SCRA 375), we have said that, although denominated a Deed ofConditional Sale, a sale is still absolute where the contract is devoid of any proviso that title is reserved or theright to unilaterally rescind is stipulated, e.g., until or unless the price is paid. Ownership will then be transferredto the buyer upon actual or constructive delivery ( e.g . by the execution of a public document) of the property sold.Where the condition is imposed upon the perfection of the contract itself, the failure of the condition would preventsuch perfection. If the condition is imposed on the obligation of a party which is not fulfilled, the other party mayeither waive the condition or refuse to proceed with the sale. (Art. 1545, Civil Code).Thus, in one case, when the sellers declared in a Receipt of Down Payment that they received anamount as purchase price for a house and lot without any reservation of title until full payment of the entirepurchase price, the implication was that they sold their property. In Peoples Industrial and Commercial Corporation v. Court of Appeals, it was stated:.

CIVIL LAW REVIEW 2DIGESTS ON CONTRACTS A deed of sale is considered absolute in nature where there is neither a stipulation in the deed that title tothe property sold is reserved in the seller until full payment of the price, nor one giving the vendor the right tounilaterally resolve the contract the moment the buyer fails to pay within a fixed period.Applying these principles to this case, it cannot be gainsaid that the contract of sale between the partiesis absolute, not conditional. There is no reservation of ownership nor a stipulation providing for a unilateralrescission by either party. In fact, the sale was consummated upon the delivery of the lot to respondent. Thus,Art. 1477 provides that the ownership of the thing sold shall be transferred to the vendee upon the actual orconstructive delivery thereof.The condition in the deed that the balance of P1,000.00 shall be paid to the vendor by the vendee assoon as the property sold shall have been surveyed in the name of the vendee and all papers pertinent andnecessary to the issuance of a separate certificate of title in the name of the vendee shall have been prepared isnot a condition which prevented the efficacy of the contract of sale. It merely provides the manner by which thetotal purchase price of the property is to be paid. The condition did not prevent the contract from being in fullforce and effect:The stipulation that the payment of the full consideration based on a survey shall be due andpayable in five (5) years from the execution of a formal deed of sale is not a condition whichaffects the efficacy of the contract of sale. It merely provides the manner by which the fullconsideration is to be computed and the time within which the same is to be paid. But it does notaffect in any manner the effectivity of the contract. In a contract to sell, ownership is retained by a seller and is not to be transferred to the vendee until fullpayment of the price. Such payment is a positive suspensive condition, the failure of which is not a breach ofcontract but simply an event that prevented the obligation from acquiring binding force.It bears stressing that in a contract of sale, the non-payment of the price is a resolutory condition whichextinguishes the transaction that, for a time, existed and discharges the obligation created under the transaction.A seller cannot unilaterally and extrajudicially rescind a contract of sale unless there is an express stipulationauthorizing it. In such case, the vendor may file an action for specific performance or judicial rescission.Article 1169 of the New Civil Code provides that in reciprocal obligations, neither party incurs in delay ifthe other does not comply or is not ready to comply in a proper manner with what is incumbent upon him; fromthe moment one of the parties fulfills his obligation, delay by the other begins. In this case, the vendor (JesusMascuana) failed to comply with his obligation of segregating Lot No. 124-B and the issuance of a Torrens titleover the property in favor of the vendee, or the latters successors-in-interest, the respondents herein. Worse,petitioner Jose Mascuana was able to secure title over the property under the name of his deceased father