8epubllc of Lhe hlllpplnes

SUkLML CCUk1
Manlla
SLCCnu ulvlSlCn
G.k. No. L-6S42S November S, 1987
IkLNLC LLAL, ICSL LLAL, CA1ALINA LLAL, 8LkNA8LLA LLAL, VICLN1L LLAL LUICGIA
LLAL A1LkNC kAMCS, MACAkIC DLL kCSAkIC, MAkGAkI1A AL8Lk1C, VIC1CkIA
1CkkLS, IUS1INA MANULL, IULIAN MANULL, MLLANIA SAN1CS, CLLMLN1L SAMAkIC,
MAkIkINA VALLL, INC., MIGULLA MLNDC2A, and kLGIS1Lk CI DLLDS CI kI2AL,
peLlLloners,
vs.
1nL nCNCkA8LL IN1LkMLDIA1L ALLLA1L CCUk1 (4th C|v|| Cases D|v|s|on), and
VICLN1L SAN1IAGC (Subst|tuted by SALUD M. SAN1IAGC), respondenLs.

SAkMILN1C, !"#
ln lLs resoluLlon daLed SepLember 27, 1983, Lhe respondenL lnLermedlaLe AppellaLe
CourL, 1 speaklng Lhrough !usLlce orflrlo v, Slson, ordered, ln parL, Lhe peLlLloners Lo
accepL Lhe sum of 3,600.00 from Lhe prlvaLe respondenL as repurchase prlce of Lhe loLs
descrlbed ln Lhe "CompravenLa" and, LhereafLer, Lo execuLe a ueed of 8epurchase Lo
effecL Lransfer over ownershlp over Lhe same properLles Lo Lhe prlvaLe respondenL.
1hls rullng was a compleLe reversal of Lhe earller declslon,
2
daLed !une 28, 1.978,
penned by !usLlce aras, of Lhe CourL of Appeals, ln Lhe same case, afflrmlng Lhe Lrlal
courL's dlsmlssal of Lhe prlvaLe respondenL's complalnL.
1he peLlLloners, feellng aggrleved and asLonlshed by Lhe compleLe Lurnaround of Lhe
respondenL courL, come Lo us wlLh Lhls peLlLlon for revlew by cerLlorarl.
1he anLecedenL facLs are undlspuLed.
1hls case brlngs us back almosL half a cenLury ago, on March 21, 1941, when a
documenL enLlLled "CompravenLa," wrlLLen enLlrely ln Lhe Spanlsh language, lnvolvlng
Lhree parcels of land, was execuLed by Lhe prlvaLe respondenL's predecessors-ln-
lnLeresL, vlcenLe SanLlago and hls broLher, Luls SanLlago, ln favor of Clrlllo Leal Lhe
deceased faLher of some of Lhe peLlLloners, ursuanL Lo Lhls "CompravenLa," Lhe LlLle
over Lhe Lhree parcels of land ln Lhe name of Lhe vendors was cancelled and a new one
was lssued ln Lhe name of Clrllo Leal who lmmedlaLely Look possesslon and exerclsed
ownershlp over Lhe sald lands. When Clrllo dled on uecember 10, 1939, Lhe sub[ecL
lands were lnherlLed by hls slx chlldren, who are among Lhe peLlLloners, and who caused
Lhe consolldaLlon and subdlvlslon of Lhe properLles among Lhemselves.
8eLween Lhe years 1960 and 1963, Lhe properLles were elLher morLgaged or leased by
Lhe peLlLloners-chlldren of Clrllo Leal Lo Lhelr co-peLlLloners.
SomeLlme before Lhe agrlculLural year 1966-1967, vlcenLe SanLlago approached Lhe
peLlLloners and offered re- repurchase Lhe sub[ecL properLles. eLlLloners, however,
refused Lhe offer. ConsequenLly, vlcenLe SanLlago lnsLlLuLed a complalnL for speclflc
performance before Lhe Lhen CourL of llrsL lnsLance of Cuezon ClLy on AugusL 2, 1967.
All Lhe Lrlal, Lhe courL ! #$% rendered lLs declslon,-dlsmlsslng Lhe complalnL on Lhe
ground LhaL Lhe same was sLlll premaLure conslderlng LhaL Lhere was, as yeL, no sale nor
any allenaLlon equlvalenL Lo a sale. noL saLlsfled wlLh Lhls declslon, Lhe prlvaLe
respondenL appealed Lo Lhe CourL of Appeals and Lhe laLLer, acLlng Lhrough Lhe lourLh
ulvlslon and wlLh !usLlce Ldgardo aras as &%'(')( afflrmed Lhe declslon of Lhe courL !
#$%.
1he peLlLloners seasonably flled a moLlon Lo amend Lhe dlsposlLlve porLlon of Lhe
declslon so as Lo lnclude an order for Lhe cancellaLlon of Lhe annoLaLlons aL Lhe back of
Lhe 1ransfer cerLlflcaLes of 1lLle lssued ln Lhelr favor. 1he prlvaLe respondenL,-on Lhe
oLher hand, flled a-Llmely moLlon for reconslderaLlon of Lhe above declslon and an
opposlLlon Lo peLlLloners' moLlon Lo amend. 1hese lncldenLs were noL resolved unLll
Lhen CourL of Appeals was abollshed and ln lleu of whlch Lhe lnLermldeaLe AppellaLe
CourL was esLabllshed ln vlew of Lhe sald reorganlzaLlon, case was reasslgned Lo Lhe
lourLh Clvll ln Lhls cases ulvlslon.
8esolvlng Lhe abovesLaLed moLlon for reconslderaLlon, Lhe respondenL courL, ln a
resoluLlon penned by !usLlce Slson and promulgaLed on SepLember 27, 1983, ruled, as
follows:
WPL8LlC8L, Cur declslon of !une 28, 1978 ls hereby reversed and seL
aslde and anoLher one ls rendered orderlng: (1) defendanLs-appellees
surnamed Leal Lo accepL Lhe sum of 3,600.00 from plalnLlff-appellanL
(subsLlLuLed by Salud M. SanLlago) as repurchase prlce of Lhe loLs
descrlbed ln Lhe "CompravenLa" of March 21, 1941, and LhereafLer Lo
execuLe a deed of repurchase sufflclenL ln law Lo Lransfer ownershlp of
Lhe properLles Lo appellanL Salud M. SanLlago, Lhe same Lo be done
wlLhln flve (3) days from paymenL, (2) orderlng Lhe same defendanLs
Leals and defendanL ClemenLe Samarlo Lo lndemnlfy appellanL ln Lhe sum
of 3,087.30 as renLal for Lhe year 1967-1968 and Lhe same amounL
every year LhereafLer, (3) orderlng an Lhe defendanLs [olnLly and severally
Lo pay Lhe sum of l,300.00 as aLLorney's fees and oLher expenses of
llLlgaLlon, and (4) orderlng defendanL 8eglsLer of ueeds of 8lzal Lo cancel
1ransfer CerLlflcaLe of 1lLle no. 42333 ln Lhe names of vlcenLe SanLlago
and Luls SanLlago upon presenLaLlon of Lhe deed of sale hereln ordered
Lo be execuLed by Lhe appellees ln favor of Salud M. SanLlago and Lo lssue
Lhereof anoLher 1ransfer CerLlflcaLe of 1lLle ln Lhe name alone of Salud
M. SanLlago. no cosLs here and ln Lhe courLs (slc) below.
SC C8uL8Lu.
verlly, Lhe well-sprlng whence Lhe presenL conLroversy arose ls Lhe abovemenLloned
"CompravenLa," more parLlcularly paragraph (b) Lhereof, Lo wlL:
xxx xxx xxx
(b) Ln caso de venLa, no podran vender a oLros dlchos Lres loLes de
Lerreno slno al aqul vendedor vlcenLe SanLlago, o los herederos o
sucesores de esLe por el nllsmo preclo de ClnCC MlL SLlSClLn1CS LSCS
(3,600.00) slempre y cuando esLos ulLlmos pueden hacer la compra.
3

xxx xxx xxx
whlch ls now Lhe sub[ecL of varylng and confllcLlng lnLerpreLaLlons.
xxx xxx xxx
lL ls admlLLed by boLh parLles LhaL Lhe phrase "Lhey shall noL sell Lo oLhers Lhese Lhree
loLs buL only Lo Lhe seller vlcenLe SanLlago or Lo hls helrs or successors" ls an express
prohlblLlon agalnsL Lhe sale of Lhe loLs descrlbed ln Lhe "CompravenLa" Lo Lhlrd persons
or sLrangers Lo Lhe conLracL. Powever, whlle prlvaLe respondenL naLurally lauds Lhe
resoluLlon of !usLlce Slson, whlch susLalns Lhe valldlLy of Lhls prohlblLlon, Lhe peLlLloners,
on Lhe oLher hand, endorse Lhe declslon penned by !usLlce aras, whlch sLaLes, ln parL:
xxx xxx xxx
llnally, Lhere ls grave doubL re Lhe valldlLy of Lhe osLenslble resoluLory
condlLlon here, namely, Lhe prohlblLlon Lo sell Lhe loLs Lo persons oLher
Lhan Lhe vendor (appellanL), uncerLalnly, a prohlblLlon Lo allenaLe should
noL exceed aL mosL a perlod of LwenLy years, oLherwlse Lhere would be
subverslon of publlc pollcy, whlch naLurally frowns on unwarranLed
resLrlcLlons on Lhe rlghL of ownershlp.
4

xxx xxx xxx
We agree wlLh Lhe aras &%'('*+!,
ConLracLs are generally blndlng beLween Lhe parLles, Lhelr asslgns and helrs, however,
under ArL. 1233 of Lhe Clvll Code of Spaln, whlch ls appllcable ln Lhls lnsLance, pacLs,
clauses, and condlLlons whlch are conLrary Lo publlc order are null and vold, Lhus,
wlLhouL any blndlng effecL.
arenLheLlcally, Lhe equlvalenL provlslon ln Lhe Clvll Code of Lhe hlllpplnes ls LhaL of
ArL. 1306, whlch sLaLes: "1haL conLracLlng parLles may esLabllsh such sLlpulaLlons,
clauses, Lerms and condlLlons as Lhey may deem convenlenL, provlded Lhey are noL
conLrary Lo law, morals, good cusLoms, publlc order, or publlc pollcy. ubllc order
slgnlfles Lhe publlc weal publlc pollcy.
S
LssenLlally, Lherefore, publlc order and publlc
pollcy mean one and Lhe same Lhlng. ubllc pollcy ls slmply Lhe Lngllsh equlvalenL of
"order publlco" ln ArL. 1233 of Lhe Clvll Code of Spaln.
6

Cne such condlLlon whlch ls conLrary Lo publlc pollcy ls Lhe presenL prohlblLlon Lo self Lo
Lhlrd parLles, because Lhe same vlrLually amounLs Lo a perpeLual resLrlcLlon Lo Lhe rlghL
of ownershlp, speclflcally Lhe owner's rlghL Lo freely dlspose of hls properLles. 1hls, we
hold LhaL any such prohlblLlon, lndeflnlLe and sLaLed as Lo Llme, so much so LhaL lL shall
conLlnue Lo be appllcable even beyond Lhe llfeLlme of Lhe orlglnal parLles Lo Lhe
conLracL, ls, wlLhouL doubL, a nulllLy. ln Lhe llghL of Lhls pronouncemenL, we granL Lhe
peLlLloners' prayer for Lhe cancellaLlon of Lhe annoLaLlons of Lhls prohlblLlon aL Lhe back
of Lhelr 1ransfer CerLlflcaLes '1lLle.
lL wlll be noLed, moreover, LhaL Lhe peLlLloners have never sold, or even aLLempLed Lo
sell, Lhe properLles sub[ecL of Lhe "CompravenLa. "
We now come Lo whaL we belleve ls Lhe very lssue ln Lhls case whlch ls, wheLher or noL
under Lhe aforequoLed paragraph (b) of Lhe "CompravenLa" a rlghL of repurchase ln
favor of Lhe prlvaLe respondenL exlsL.
1he rullng of Lhe lourLh ulvlslon (!usLlce aras) ls LhaL Lhe sald sLlpulaLlon does noL granL
a rlghL Lo repurchase. ConLrarlly, Lhe resoluLlon of Lhe lourLh Clvll Cases ulvlslon (!usLlce
. v. Slson) lnLerpreLed Lhe same provlslon as granLlng Lhe rlghL Lo repurchase sub[ecL Lo
a condlLlon precedenL.
1hus, Lhe assalled 8esoluLlon, reverslng Lhe earller declslon of Lhe same respondenL
courL, ruled
xxx xxx xxx
1he all-lmporLarLanL phrase "en caso de venLa," musL of necesslLy refer Lo
Lhe sale of Lhe properLles elLher by Clrllo or hls helrs Lo Lhe SanLlago
broLhers Lhemselves or Lo Lhelr helrs, lncludlng appellanLs vlcenLe
SanLlago lncludlng appellanLs vlcenLe SanLlago and Salud M SanLlago, for
Lhe same sum of 3,600.00, "slempre y cuando esLos ulLlmos pueden
hacer la compra" (when Lhe laLLer shall be able Lo buy lL).
xxx xxx xxx
... We repeaL, 1he words envlslon Lhe slLuaLlon conLemplaLed by Lhe
conLracLlng parLles Lhemselves, Lhe resale of Lhe loLs Lo Lhelr owners, and
nC1 Lo a sale of Lhe loLs Lo Lhlrd parLles or sLrangers Lo Lhe conLracLs. ...
7

xxx xxx xxx
1he law provldes LhaL for convenLlonal redempLlon Lo Lake place, Lhe vendor should
reserve, ln no uncerLaln Lerms, Lhe rlghL Lo repurchase Lhe Lhlng sold.
8
1hus, Lhe rlghL Lo
redeem musL be expressly sLlpulaLed ln Lhe conLracL of sale ln order LhaL lL may have
legal exlsLence.
ln Lhe case before us, we cannoL and any express or lmplled granL of a rlghL Lo
repurchase, nor can we lnfer, from any word or words ln Lhe quesLloned paragraph, Lhe
exlsLence of any such rlghL. 1he lnLerpreLaLlon ln Lhe resoluLlon (!usLlce Slson) ls raLher
sLralned. 1he phrase "ln case case" of should be consLrued Lo mean "should Lhe buyers
wlsh Lo sell whlch ls Lhe plaln and slmple lmporL of Lhe words, and noL "Lhe buyers
should sell," whlch ls clearly a conLorLed consLrucLlon of Lhe same phrase. 1he resorL Lo
ArLlcle 1373 of Lhe Clvll Code of Lhe hlllpplnes ls erroneous. 1he sub[ecL phrase ls
paLenL and unamblguous, hence, lL musL noL be glven anoLher lnLerpreLaLlon
8uL even assumlng LhaL such a rlghL of repurchase ls granLed under Lhe "CompravenLa,"
Lhe peLlLloner correcLly asserLs LhaL Lhe same has already prescrlbed. under ArL. 1308 of
Lhe Clvll Code of Spaln (ArL,. 1606 of Lhe Clvll Code of Lhe hlllpplnes), Lhe rlghL Lo
redeem or repurchase, ln Lhe absence of an express agreemenL as Lo Llme, shall lasL four
years from Lhe daLe of Lhe conLracL. ln Lhls case Lhen, Lhe rlghL Lo repurchase, lf lL was aL
four guaranLeed under ln Lhe "CompravenLa," should have been exerclse wlLhln four
years from March 21, 1941 (lndublLably Lhe daLe of execuLlon of Lhe conLracL), or aL Lhe
laLesL ln 1943.
ln Lhe respondenL courL's resoluLlon, lL ls furLher ruled LhaL Lhe rlghL Lo repurchase was
glven blrLh by Lhe condlLlon precedenL provlded for ln Lhe phrase "slempre y cuando
esLos ulLlmos pueden hacer la compra" (when Lhe buyer has money Lo buy). ln oLher
words, lL ls Lhe respondenL courL's conLenLlon LhaL Lhe rlghL may be exerclsed only when
Lhe buyer has money Lo buy. lf Lhls were so, Lhe second paragraph of ArLlcle 1308 would
apply Lhere ls agreemenL as Lo Lhe Llme, alLhough lL ls lndeflnlLe, Lherefore, Lhe rlghL
should be exerclsed wlLhln Len years, because Lhe law does noL favor suspended
ownershlp. Slnce Lhe alleged rlghL Lo repurchase was aLLempLed Lo be exerclsed by
vlcenLe SanLlago only ln 1966, or 23 years from Lhe daLe of Lhe conLracL, Lhe sald rlghL
has undoubLedly explred.
WnLkLICkL, |n v|ew of the forego|ng, the keso|ut|on dated September 27, 1983, of
the respondent court |s SL1 ASIDL and the Dec|s|on promu|gated on Iune 28, 1978 |s
hereby kLINS1A1LD. 1he annotat|ons of the proh|b|t|on to se|| at the back of 1C1 Nos.
138837, 138838, 138839, 138840, 138841, and 138842 are hereby ordered CANCLLLLD.
Costs aga|nst the pr|vate respondent.
SC CkDLkLD.