DIGNOS vs CA

FACTS:
The spouses Silvestre and Isabel Dignos were owners of a parcel of land in Opon, Lapu-Lapu City. On
June 7, 1965, appellants, herein petitioners Dignos spouses sold the said parcel of land to respondent
Atillano Jabil for the sum of P28,000.00, payable in two installments, with an assumption
of indebtedness with the First Insular Bank of Cebu in the sum of PI 2,000.00, which was paid and
acknowledged by the vendors in the deed of sale executed in favor of plaintiff-appellant, and the next
installment in the sum of P4,000.00 to be paid on or before September 15, 1965.On November 25,
1965, the Dignos spouses sold the same land in favor of defendants spouses Cabigas, for the price of
P35,000.00. A deed of absolute sale was executed by the Dignos spouses in favor of the Cabigas
spouses, and which was registered in the Office of the Register of Deeds pursuant to the provisions of
Act No. 3344. As the Dignos spouses refused to accept from plaintiff-appellant the balance of the
purchase price of the land, and as plaintiff- appellant discovered the second sale made by
defendants-appellants to the Cabigas spouses, plaintiff-appellant brought the present suit.

ISSUE:
Whether or not there was an absolute contract of sale.2. Whether or not the contract of sale
was already rescinded when the Digros spouses sold the land toCabigas

HELD:
Yes. That a deed of sale is absolute in nature although denominated as a "Deed of Conditional Sale"
where nowhere in the contract in question is a proviso or stipulation to the effect that title to the
property sold is reserved in the vendor until full payment of the purchase price, nor is there a
stipulation giving the vendor the right to unilaterally rescind the contract the moment the vendee
fails to pay within a fixed period. A careful examination of the contract shows that there is no such
stipulation reserving the title of the property on the vendors nor does it give them the right to
unilaterally rescind the contract upon non-payment of the balance thereof within a fixed period. On
the contrary, all the elements of a valid contract of sale under Article 1458 of the Civil Code, a
represent, such as: (1) consent or meeting of the minds; (2) determinate subject matter; and
(3)price certain in money or its equivalent. In addition, Article 1477 of the same Code provides that
"The ownership of the thing sold shall be transferred to the vendee upon actual or constructive
delivery thereof." While it may be conceded that there was no constructive delivery of the land sold
in the case at bar, as subject Deed of Sale is a private instrument, it is beyond question that there was
actual delivery thereof. As found by the trial court, the Dignos spouses delivered the possession of
the land in question to Jabil as early as March 27,1965 so that the latter constructed thereon various
resorts. Such facts were admitted by petitioner spouses.
2. No. The contract of sale being absolute in nature is governed by Article 1592 of the Civil Code. It is
undisputed that petitioners never notified private respondents Jabil by notarial act that they were
rescinding the contract, and neither did they file a suit in court to rescind the sale. Under Article 1358
of the Civil Code, it is required that acts and contracts which have for their object extinguishment of
real rights over immovable property must appear in a public document. Petitioners laid considerable
emphasis on the fact that private respondent Jabil had no money on the stipulated date of payment.
It has been ruled, that where time is not of the essence of the agreement, a slight delay on the part of
one party in the performance of his obligation is not a sufficient ground for the rescission of
the agreement. Considering that private respondent has only a balance of P4,OOO.00 and was
delayed in payment only for one month, equity and justice mandate as in the afore cited case that
Jabil be given an additional period within which to complete payment of the purchase price.

ARTATES vs URBI
FACTS:
In an action filed in the Court of First Instance of Cagayan, the spouses Lino Artates and
Manuela Pojas sought annulment of the execution of a homestead

covered by Patent No. V-12775
issued to them by the proper land authorities on 23 September 1952, and duly registered in their
names. The public sale, conducted by the Provincial Sheriff of Cagayan on 2 June 1962, was made to
satisfy a judgment against Lino Artates in the amount of P1,476.35, and awarded to Daniel Urbi by
the Justice of the Peace Court of Camilaniugan, Cagayan, in its Civil Case No. 40, for physical injuries
inflicted by Artates upon Urbi on 21 October 1955. In the execution sale, the property was sold to the
judgment creditor, the only bidder. In their complaint, the plaintiffs spouses alleged that the sale of
the homestead to satisfy an indebtedness of Lino Artates that accrued on 21 October 1955, violated
the provision of the Public Land law exempting said property from execution for any debt contracted
within five years from the date of the issuance of the patent; that defendant Urbi, with the intention
of defrauding the plaintiffs, executed on 26 June 1961 a deed for the sale of the same parcel of land to
defendant Crisanto Soliven, a minor; that as a result of the aforementioned transactions, defendants
Urbi and Soliven entered into the possession of the land and deprived plaintiffs of the owners' share
in the rice crops harvested during the agricultural year 1961-1962. Plaintiffs, therefore, prayed,
among others that the public sale of the land to defendant Urbi, as well as the deed of sale executed
by the latter in favor of defendant Soliven, be declared null and void. The court rendered judgment
upholding the regularity and validity of the execution conducted by the defendant Provincial Sheriff,
but finding that the sale of the lands by defendant Urbi to the minor Soliven was simulated, intended
to place the property beyond the reach of the judgment debtor. Consequently, the court declared the
sale of the land by defendant Daniel Urbi to defendant Crisanto Soliven null and void; and Daniel Urbi
was ordered to reconvey the property to the plaintiffs upon the latter's payment (to Urbi) of the sum
of P1,476.35 plus the sheriff's fee incident to the sale at public auction. Plaintiffs appealed.
ISSUE: w/n the purchaser Marcela Soliven has acquired an absolute ownership or title in fee over
theland.
HELD: No. The execution sale being null and void, the possession of the land should be returned to
theowners, the herein appellants. There would even no need to order appelleeUrbi to execute a deed
of reconveyance thereof to the owners. It appears that what was issued here to the judgment
creditor orpurchaser was only the sheriff's provisional certificate, under which he derived no definite
title or rightuntil the period made, or issuance of a final deed or certificate of sale. In other words, the
purchaserherein has not acquired an absolute ownership or title in fee over the land that would
necessitate a deedof reconveyance to revert ownership back to appellant spouses.

HEIRS OF ENRIQUE ZAMBALES vs CA
Facts:
The Zambales spouses were the homestead patentees of a parcel of land situated in the Municipality
of Del Pilar, Roxas, Palawan. The Zambaleses instituted, on November 10, 1958, Civil Case No. 316
before the CFI of Palawan claiming damages in the total sum of P48,000.00, claiming that the Nin Bay
Mining Corporation had removed silica sand from their land and destroyed the plants and others
improvements thereon. The Corporation denied having caused any damages and claimed that it had
excavated and extracted silica sand only from its own mining claims and on which it had mining lease
contracts with the Philippine Government. On October 29, 1959, the parties entered into a
compromise agreement where the corporation agreed to pay the petitioners a rental of twenty pesos
(P20.00) from September 9, 1955 to September 30, 1960 or a total rental price of P1,784.74.
Respondent also agreed to purchase and pay for the aforesaid property at the fixed selling rice of
P500.00 per hectare or a total purchase price of P8,923.70.. The Court then rendered judgement
based on the agreement. On September 10, 1960, the Corporation, as attorney-in-fact for the
Zambaleses, as Vendors, sold the disputed property to Joaquin B. Preysler. On December 6, 1969, or
ten (10) years after the Trial Courts Decision based on the Compromise Agreement, and nine (9)
years after the sale to Preysler, the Zambaleses filed Civil Case No. 678 before the Court of First
Instance of Palawan for Annulment of a Deed of Sale with Recovery of Possession and Ownership
with Damages, contending that the land was acquired and registered in the latters name through
fraud and deceit. After trial, the lower Court rendered judgment in favor of the Zambaleses. On
appeal by the Corporation, the Court of Appeals reversed the Trial Court, after finding that the
alleged fraud or misrepresentation in the execution of the Compromise Agreement had not been
substantiated by evidence.
ISSUE: W/N the compromise agreement and subsequent Deed of Sale were valid
HELD: Although we find that the Zambaleses were not misled into signing the Compromise
Agreement, we hold that there has been violation of the Public Land Act. The evidence on record
shows that the land in question was awarded to the Zambaleses as a homestead on September 6,
1955. The sale of a homestead lot within the five-year prohibitory period is illegal and void. The law
does not distinguish between executory and consummated sales. The bilateral promise
to buy and sell the homestead lot at a price certain, which was reciprocally demandable, was entered
into within the five-year prohibitory period and is therefore, illegal and void. Further, the agency to
sell the homestead lot to a third party was coupled with an interest inasmuch as a bilateral contract
was dependent on it and was not revocable at will by any of the parties. For all intents and purposes,
therefore, there was an actual executory sale perfected during the period of prohibition except that it
was reciprocally demandable thereafter and the agency to sell to any third party was deferred until
after the expiration of the prohibitory period. That rentals were ostensibly to be paid during the
five-year prohibitory period, and the agency to sell made effective only after the lapse of the said
period, was merely a devise to circumvent the prohibition. The approval of the sale by the
Secretary of Agriculture and Natural Resources after the lapse of five years from the date of the
patent would neither legalize the sale. The homestead in question should be returned to the
Zambaleses, petitioners herein, who are, in turn, bound to restore to the Corporation the sum of
P8,923.70 as the price thereof.
QUIROGA vs PARSONS
Facts:
On January 24, 1911, herein plaintiff-appellant Andress Quiroga and J. Parsons, both merchants,
entered into a contract, for the exclusive sale of "Quiroga" Beds in the Visayan Islands. It was agreed,
among others, that Andres Quiroga grants the exclusive right to sell his beds in the Visayan Islands to
J.Parsons, subject to some conditions provided in the contract. Likewise, it was agreed that. In
compensation for the expenses of advertisement which, for the benefit of both contracting parties,
Mr. Parsons may find himself obliged to make, Mr. Quiroga assumes the obligation to offer and give
the preference to Mr. Parsons in case anyone should apply for the exclusive agency for any island not
comprised with the Visayan group; and that, Mr. Parsons may sell, or establish branches of his agency
for the sale of "Quiroga" beds in all the towns of the Archipelago where there are no exclusive agents,
and shall immediately report such action to Mr. Quiroga for his approval. Plaintiff filed a complaint,
alleging that the defendant violated the following obligations: not to sell the beds at higher prices
than those of the invoices; to have an open establishment in Iloilo; itself to conduct the agency; to
keep the beds on public exhibition, and to pay for the advertisement expenses for the same; and to
order the beds by the dozen and in no other manner. He alleged that the defendant was his agent for
the sale of his beds in Iloilo, and that said obligations are implied in a contract of commercial agency.

ISSUE:
Whether or not the defendant, by reason of the contract hereinbefore transcribed, was a purchaser
or an agent of the plaintiff for the sale of his beds.

HELD:
Defendant was a purchaser, not an agent. In order to classify a contract, due regard must be given to
its essential clauses. In the contract in question, there was the obligation on the part of the plaintiff
to supply the beds, and, on the part of the defendant, to pay their price. These features exclude the
legal conception of an agency or order to sell whereby the mandatory or agent received the thing to
sell it, and does not pay its price, but delivers to the principal the price he obtains from the sale of the
thing to a third person, and if he does not succeed in selling it, he returns it. By virtue of the contract
between the plaintiff and the defendant, the latter, on receiving the beds, was necessarily obliged to
pay their price within the term fixed, without any other consideration and regardless as to whether
he had or had not sold the beds. In respect to the defendant's obligation to order by the dozen, the
only one expressly imposed by the contract, the effect of its breach would only entitle the plaintiff to
disregard the orders which the defendant might place under other conditions; but if the plaintiff
consents to fill them, he waives his right and cannot complain for having acted thus at his own free
will.

CONCRETE AGGREGATES vs CTA
FACTS:
Petitioner, a domestic corporation duly existing under the laws of the Philippines, has an aggregate
plant at Montalban, Rizal which processes rock aggregates mined by it from private lands, and
maintains and operates a plant at Longos, Quezon City for the production of ready-mixed concrete
and plant-mixed hot asphalt. Sometime in 1968, the agents of respondent Commission on Internal
Revenue (CIR) conducted an investigation of petitioner's tax liabilities, and assessed and demanded
payment from petitioner the amount of P244,002.76 as sales and ad valorem taxes for the first
semester of 1968, inclusive of surcharges.
Instead of paying, the petitioner appealed to respondent CTA. The said Court concluded that
petitioner is a manufacturer subject to the 7% sales tax under the Section Section 186 of the 1968
National Internal Revenue Code, and ordered it to pay what the respondent CIR demands, plus
interest at the rate of 14% per centum from January 1, 1973 up to the date of full payment thereof
pursuant to Section 183 (now 193) of the same Code. Petitioner contends, however, that it is a
contractor within the meaning of Section 191 under the same Code, that its business falls under
"other construction work contractors" or "other independent contractors", and that it produced
asphalt and concrete mix only upon previous orders.

ISSUE: Is the petitioner a contractor subject to the 3% contractor's tax under Section 191 or a
manufacturer subject to the 7% sales tax under Section 186?
HELD: In its factual findings, respondent court found that petitioner was formed and organized
primarily as a manufacturer; that it has an aggregate plant at Montalban, Rizal, which processes rock
aggregates mined by it from private lands; it operates a concrete batching plant at Longos, Quezon
City where the specified aggregates from its plant at Montalban are mixed with sand and cement,
after which water is added and the concrete mixture is sold and delivered to customers; and at its
plant site at Longos, Quezon City, petitioner has also an asphalt mixing machinery where bituminous
asphalt mix is manufactured. We see no reason to disturb the findings of respondent court. Petitioner
is a manufacturer as defined by Section 194(x), now Section 187(x), of the Tax Code.
As aptly pointed out by the Solicitor General, petitioner's raw materials are processed under a
prescribed formula and thereby changed by means of machinery into a finished product, altering
their quality, transforming them into marketable state or preparing them for any of the specific uses
of industry. Thus, the raw materials become a distinct class of merchandise or "finished products for
the purpose of their sales or distribution to others and not for his own use or consumption."
Evidently, without the above process, the raw materials or aggregates could not, in their original
form, perform the uses of the finished product. Selling or distribution is an essential ingredient of
manufacturing. The sale of a manufactured product is properly incident to manufacture. The power
to sell is an indispensable adjunct to a manufacturing business. Petitioner, as a manufacturer, not
only manufactures the finished articles but also sells or distributes them to others. This is inferable
from the testimonial evidence of petitioner's witness that, in the marketing of its products, the
company has marketing personnel who visit the client, whether he is a regular or a prospective
customer, and that it is the customer who specifies the requirement according to his needs by filling
up a purchase order, after which a job order is issued. This is followed by the delivery of the finished
product to the job site.
It is clear that petitioner does nothing more than sell the articles that it habitually
manufactures. It stocks raw materials, ready at any time, for the manufacture of asphalt and/or
concrete mix.
23
Its marketing system would readily disclose that its products are available for sale to
anyone needing them. Whosoever would need its products, whether builder, contractor, homeowner
or payer with sufficient money, may order aggregates, concrete mix or bituminous asphalt mix of the
kind manufactured by petitioner.
24
The habituality of the production of goods for the general public
characterizes the business of petitioner.
Peoples Homesite vs. CA
FACTS: In February 1960, herein petitioner Peoples Homesite & Housing Corporation (PHHC) passed
a resolution, subject to the approval of the Court Court Council of the PHHCs consolidation
subdivision plan, awarding Lot 4 with an area of 4,182.2 square meters located at Diliman, Court City
to respondents Rizalino and Adelaida Mendoza (spouses Mendoza) at a price of twenty-one pesos
(P21.00) per square meter. The Court Court Council disapproved the consolidation subdivision plan in
August 1960 but approved in February 1964 its revised version where Lot 4 was reduced to an area of
2,608.7 square meters. Then in October 1965, the PHHC withdrew the tentative award of Lot 4 to the
spouses Mendoza for the latters failure neither to pay its price nor to make a 20% initial deposit, and
re-awarded said lot jointly and in equal shares to Miguela Sto. Domingo, Enrique Esteban, Virgilio
Pinzon, Leonardo Redublo and Jose Fernandez, all of whom made the initial deposit. The subdivision
of Lot 4 into five lots was later approved by the Court council and the Bureau of Lands.
The spouses Mendoza asked for reconsideration and for the withdrawal of the said 2nd award to Sto.
Domingo and four others, and at the same time filed an action for specific performance plus
damages. The trial court sustained the award but the Court of Appeals reversed the said decision,
declared void the re-award to Sto. Domingo and four others, and ordered the PHHC to sell Lot 4 with
an area of 2,608.7 square meters at P21.00 per square meter to spouses Mendoza.
ISSUE:
Was there a perfected sale of Lot 4, with its reduced area, between the parties?

COURT RULING: The Supreme Court found that there was no perfected sale of Lot 4 because the said
lot was conditionally or contingently awarded to the Mendozas subject to the approval by the Court
council of the proposed consolidation subdivision plan and the approval of the award by the
valuation committee and higher authorities.
When the plan with the area of Lot 4 reduced to 2,608.7 square meters was approved in
1964, the spouses Court should have manifested in writing their acceptance of the award for the
purchase of Lot 4 just to show that they were still interested in its purchase although the area was
reduced. Article 1475 of the Civil Court says *t+he 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. From
that moment, the parties may reciprocally demand performance, subject to the law governing the
form of contracts. Indeed, there was a no meeting of the minds between the parties on the
purchase of Lot 4 with an area of 2,608.7 square meters at P21 a square meter and the PHHC board
of directors acted within its rights in withdrawing the tentative award.