G.R. No.

170405 February 2, 2010

RAYMUNDO S. DE LEON, Petitioner,
vs.
BENITA T. ONG. Respondent.

Facts:
On March 10, 1993, Raymundo S. De Leon (petitioner) sold 3 parcels of land to Benita
T. Ong(respondent). The said properties were mortgaged to a financial institution; Real
Savings & Loan Association Inc. (RSLAI). The parties then executed a notarized deed
of absolute sale with assumption of mortgage. As indicated in the deed of mortgage, the
parties stipulated that the petitioner (de Leon) shall execute a deed of assumption of
mortgage in favor of Ong (respondent)after full payment of the P415,000. They also
agreed that the respondent (Ong) shall assume the mortgage. The respondent then
subsequently gave petitioner P415,000 as partial payment. On the other hand, de Leon
handed the keys to Ong and de Leon wrote a letter to inform RSLAI that the mortgage
will be assumed by Ong. Thereafter, the respondent took repairs and made
improvements in the properties. Subsequently, respondent learned that the same
properties were sold to a certain Viloria after March 10, 1993 and changed the locks,
rendering the keys given to her useless. Respondent proceeded to RSLAI but she was
informed that the mortgage has been fully paid and that the titles have been given to the
said person. Respondent then filed a complaint for specific performance and declaration
of nullity of the second sale and damages. The petitioner contended that respondent
does not have a cause of action against him because the sale was subject to a
condition which requires the approval of RSLAI of the mortgage. Petitioner reiterated
that they only entered into a contract to sell. The RTC dismissed the case. On appeal,
the CA upheld the sale to respondent and nullified the sale to Viloria. Petitioner moved
for reconsideration to the SC.

Issue:
Whether the parties entered into a contract of sale or a contract to sell?

Held:
In a contract of sale, the seller conveys ownership of the property to the buyer upon the
perfection of the contract. The non-payment of the price is a negative resolutory
condition. Contract to sell is subject to a positive suspensive condition. The buyer does
not acquire ownership of the property until he fully pays the purchase price.In the
present case, the deed executed by the parties did not show that the owner intends to
reserve ownership of the properties. The terms and conditions affected only the manner
of payment and not the immediate transfer of ownership. It was clear that the owner
intended a sale because he unqualifiedly delivered and transferred ownership of the
properties to the respondent

G.R. No. 167330. September 18, 2009

PHIL. HEALTH CARE PROVIDERS, INC. vs. COMMISSIONER OF INTERNAL
REVENUE SPECIAL FIRST DIVISION PHILIPPINE HEALTH CARE PROVIDERS,
INC., vs. COMMISSIONER OF INTERNAL REVENUE

Facts:
Commissioner of Internal Revenue [CIR] sent petitioner a formal demand letter and the
corresponding assessment notices demanding the payment of deficiency taxes,
including surcharges and interest, for the taxable years1996 and the deficiency
[documentary stamp tax (DST)] assessment was imposed on petitioner's health care
agreement with the members of its health care program pursuant to Section 185 of the
1997 Tax Code. Petitioner protested theassessment in a letter dated February 23, 2000.
As respondent did not act on the protest filed a petition for review in the Court of Tax
Appeals (CTA) seeking the cancellation of the deficiency VAT and DST assessments.
The CTA ruled that petitioner is liable for the VAT but not the DST. Respondent
appealed the CTA decision to the [Court of Appeals (CA)]insofar as it cancelled the DST
assessment. CA held that petitioner's health care agreement was in the nature of a non-
life insurance contract subject to DST.In a decision dated June 12, 2008, the Supreme
Court denied the petition and held that petitioner's health care agreement during the
pertinent period was in the nature of non-life insurance which is a contract of indemnity.
Unable to accept the verdict filed the present motion for reconsideration and
supplemental motion for reconsideration. In its motion for reconsideration reveals for the
first time that it availed of a tax amnesty under RA 9480 7 (also known as the
"Tax Amnesty Act of 2007") by fully paying the amount of P5,127,149.08 representing 5
% of its net worth as of the yearending December 31, 2005.

Issue/ Held:
W/N petitioner is liable for the DST- NO

A second hard look at the relevant law and jurisprudence convinces the Court that the
arguments of petitioner are meritorious. Petitioner is admittedly an HMO. Under RA
7875 (or "The National Health Insurance Act of 1995"), an HMO is "an entity that
provides, offers or arranges for coverage of designated health services needed by plan
members for a fixed prepaid premium". 19 The payments do not vary with the extent,
frequency or type of services provided.The question is: was petitioner, as an HMO,
engaged in the business of insurance during the pertinent taxable years? The
Court held that it was not. Applying the "principal objects and purpose test", there
is significant American case law supporting the argument that a corporation (such as an
HMO, whether or not organized for profit), whose main object is to provide the members
of a group with health services, is not engaged in the insurance business. American
courts have pointed out that the main difference between an HMO and an insurance
company is that HMOs undertake to provide or arrange for the provision of medical
services through participating physicians while insurance companies simply undertake
to indemnify the insured for medical expenses incurred up to a pre-agreed limit.In short,
even if petitioner assumes the risk of paying the cost of these services even if
significantly more than what the member has prepaid, it nevertheless cannot be
considered as being engaged in the insurance business. Overall appears to provide
insurance-type benefits to its members (with respect to its curative medical services),
but these are incidental to the principal activity of providing them medical care. The
"insurance-like" aspect of petitioner's business is miniscule compared to its non-
insurance activities. Therefore, since it substantially provides health care services rather
than insurance services, it cannot be considered as being in the insurance
business. We are aware that, in Blue Cross and Philamcare, the Court pronounced that
a health care agreement is in the nature of non-life insurance, which is primarily a
contract of indemnity. However, those cases did not involve the interpretation of a tax
provision. Instead, they dealt with the liability of a health service provider to a member
under the terms of their health care agreement. Such contracts, as contracts of
adhesion, are liberally interpreted in favor of the member and strictly against the HMO.
Not all the necessary elements of a contract of insurance are present in petitioner's
agreements.

Although risk is a primary element of an insurance contract, it is not necessarily true tha
t risk alone is sufficient toestablish it. Almost anyone who undertakes a contractual
obligation always bears a certain degree of financial risk.Consequently, there is a need
to distinguish prepaid service contracts (like those of petitioner) from the usual
insurance contracts.Furthermore, it was held in a recent case that DST is one of the
taxes covered by the tax amnesty program under RA 9480. There is no other
conclusion to draw than that petitioner's liability for DST for the taxable years 1996and
1997 was totally extinguished by its availment of the tax amnesty under RA 9480

178 SCRA 188, G.R. No. 82508

September 29, 1989

FILINVEST CREDIT CORPORATION, petitioner,

vs.
THE COURT OF APPEALS, JOSE SY BANG and ILUMINADA TAN SY
BANG,*respondents

FACTS:
Herein private respondents spouses Jose Sy Bang and Iluminada Tan were engaged in
the sale of gravel produced from crushed rocks and used for construction purposes.
They intended to buy rock crusher from Rizal Consolidated Corporation which carried a
cash price tag of P550,000.00. They applied for financial assistance from herein
petitioner Filinvest Credit Corporation, who agreed to extend financial aid on the certain
conditions.
A contract of lease of machinery (with option to purchase) was entered into by the
parties whereby the private respondents agreed to lease from the petitioner the rock
crusher for two years starting from July 5, 1981, payable as follows: P10,000.00 first 3
months, P23,000.00 next 6 months, P24,800.00 next 15 months. It was likewise
stipulated that at the end of the two-year period, the machine would be owned by the
private respondents. Thus the private respondent issued in favor of the petitioner a
check for P150,550.00, as initial rental (or guaranty deposit), and 24 postdated checks
corresponding to the 24 monthly rentals. In addition, to guarantee their compliance with
the lease contract, the private respondent executed a real estate mortgage over two
parcels of land in favor of the petitioner. The rock crusher was delivered to the spouses.
However, 3 months later, the souses stopped payment when petitioner had not acted on
the complaints of the spouses about the machine. As a consequence, petitioner extra-
judicially foreclosed the real estate mortgage. The spouses filed a complaint before the
RTC. The RTC rendered a decision in favor of private respondent. The petitioner
elevated the case to CA which affirmed the decision in toto. Hence, this petition.
ISSUES:
1. Whether or not the nature of the contract is one of a contract of sale.\
2. Whether or not the remedies of the seller provided for in Article 1484 are cumulative.
HELD:
1. Yes. The intent of the parties to the subject contract is for the so-called rentals to be
the installment payments. Upon the completion of the payments, then the rock crusher,
subject matter of the contract, would become the property of the private respondents.
This form of agreement has been criticized as a lease only in name.
Sellers desirous of making conditional sales of their goods, but who do not wish openly
to make a bargain in that form, for one reason or another, have frequently restored to
the device of making contracts in the form of leases either with options to the buyer to
purchase for a small consideration at the end of term, provided the so-called rent has
been duly paid, or with stipulations that if the rent throughout the term is paid, title shall
thereupon vest in the lessee. It is obvious that such transactions are leases only in
name. The so-called rent must necessarily be regarded as payment of the price in
installments since the due payment of the agreed amount results, by the terms of
bargain, in the transfer of title to the lessee.
2. No, it is alternative. The seller of movable in installments, in case the buyer fails to
pay 2 or more installments, may elect to pursue either of the following remedies: (1)
exact fulfillment by the purchaser of the obligation; (2) cancel the sale; or (3) foreclose
the mortgage on the purchased property if one was constituted thereon. It is now settled
that the said remedies are alternative and not cumulative, and therefore, the exercise of
one bars the exercise of the others. Indubitably, the device contract of lease with
option to buy is at times resorted to as a means to circumvent Article 1484,
particularly paragraph (3) thereof. Through the set-up, the vendor, by retaining
ownership over the property in the guise of being the lessor, retains, likewise the right to
repossess the same, without going through the process of foreclosure, in the event the
vendee-lessee defaults in the payment of the installments. There arises therefore no
need to constitute a chattel mortgage over the movable sold. More important, the
vendor, after repossessing the property and, in effect, canceling the contract of sale,
gets to keep all the installments-cum-rentals already paid.

ENGINEERING AND MACHINERY CORP. VS. COURT OF APPEALS

G.R. No. 52267 January 24, 1996
Facts:
Almeda and Engineering signed a contract, wherein Engineering undertook to fabricate,
furnish and install the air-conditioning system in the latters building along Buendia
Avenue, Makati in consideration of P210,000.00. Petitioner was to furnish the materials,
labor, tools and all services required in order to so fabricate and install said system. The
system was completed in 1963 and accepted by private respondent, who paid in full the
contract price.
Almeda learned from the employees of NIDC of the defects of the air-conditioning
system of the building. Almeda spent for the repair of the air-conditioning system. He
now sues Engineering for the refund of the repair. Engineering contends that the
contract was of sale and the claim is barred by prescription since the responsibility of a
vendor for any hidden faults or defects in the thing sold runs only for 6 months (Arts
1566, 1567, 1571). Almeda contends that since it was a contract for a piece of work,
hence the prescription period was ten years (Hence Art 1144 should apply on written
contracts).
RTC found that Engineering failed to install certain parts and accessories called for by
the contract, and deviated from the plans of the system, thus reducing its operational
effectiveness to achieve a fairly desirable room temperature.

Issue:

1) Whether the contract for the fabrication and installation of a central air-conditioning
system in a building, one of sale or for a piece of work? CONTRACT FOR PIECE OF
WORK.
2) Corrollarily whether the claim for refund was extinguished by prescription? NO.

Held:

1) A contract for a piece of work, labor and materials may be distinguished from a
contract of sale by the inquiry as to whether the thing transferred is one not in existence
and which would never have existed but for the order, of the person desiring it. In such
case, the contract is one for a piece of work, not a sale. On the other hand, if the thing
subject of the contract would have existed and been the subject of a sale to some other
person even if the order had not been given, then the contract is one of sale.
A contract for the delivery at a certain price of an article which the vendor in the ordinary
course of his business manufactures or procures for the general market, whether the
same is on hand at the time or not is a contract of sale, but if the goods are to be
manufactured specially for the customer and upon his special order, and not for the
general market, it is a contract for a piece of work .
The contract in question is one for a piece of work. It is not petitioners line of business
to manufacture air-conditioning systems to be sold off-the-shelf. Its business and
particular field of expertise is the fabrication and installation of such systems as ordered
by customers and in accordance with the particular plans and specifications provided by
the customers. Naturally, the price or compensation for the system manufactured and
installed will depend greatly on the particular plans and specifications agreed upon with
the customers.
2)The original complaint is one for damages arising from breach of a written contract
and not a suit to enforce warranties against hidden defects we here with declare that
the governing law is Article 1715 (supra). However, inasmuch as this provision does not
contain a specific prescriptive period, the general law on prescription, which is Article
1144 of the Civil Code, will apply. Said provision states, inter alia, that actions upon a
written contract prescribe in ten (10) years. Since the governing contract was executed
on September 10, 1962 and the complaint was filed on May 8, 1971, it is clear that the
action has not prescribed.

G.R. No. 122039 May 31, 2000

VICENTE CALALAS, petitioner,vs.COURT OF APPEALS, ELIZA JUJEURCHE

SUNGA and FRANCISCO SALVA, respondents.

Facts:

Eliza Jujeurche G. Sunga, a college freshman at the Siliman University, took a

passenger jeepney owned and operated by petitioner Vicente Calalas. Sunga was given
by the conductor an "extension seat," at the rear end of the vehicle. Sunga gave way to
the outgoing passenger.Just as she was doing so, an Isuzu truck driven by Iglecerio
Verena and owned by Francisco Salva bumped the left rear portion of the jeepney. As a
result, Sunga was injured and confinement in the hospital. Her attending physician
certified she would remain on a cast for a period of three months and would have to
ambulate in crutches during said period.Sunga filed a complaint for damages against
Calalas, alleging violation of the contract of carriage. Calalas, on the other hand, filed a
third-party complaint against Francisco Salva, the owner of the Isuzu truck. The lower
court rendered judgment against Salva as third-party defendant and absolved Calalas of
 liability, holding that it was the driver of the Isuzu truck who was responsible for the
accident. It took cognizance of another case, filed by Calalas against Salva and Verena,
for quasi-delict, the same court held Salva and his driver Verena jointly liable to Calalas
for the damage to his jeepney. On appeal to the Court of Appeals, the ruling of the lower
court was reversed and dismissed the third-party complaint against Salva and adjudged
Calalas liable for damages to Sunga. Hence this petition.

Issues:

(1)Whether or not the negligence of Verena was the proximate cause of the accident
negates the liability and that to rule otherwise would be to make the common carrier an
insurer of the safety of its passengers.
(2) Whether or not that the bumping of the jeepney by the truck owned by Salva was a
caso fortuito.
(3) Whether or not the award of moral damages to Sunga is supported evidence.

Held:

(1) Finding Salva and his driver Verena liable for the damage to petitioner's jeepney,
should be binding on Sunga. It is immaterial that the proximate cause of the collision
between the jeepney and the truck was the negligence of the truck driver. The doctrine
of proximate cause is applicable only in actions for quasi-delict, not in actions involving
breach of contract. The doctrine is a device for imputing liability to a person where there
is no relation between him and another party. In such a case, the obligation is created
by law itself. But, where there is a pre-existing contractual relation between the parties,
it is the parties themselves who create the obligation, and the function of the law is
merely to regulate the relation thus created. Insofar as contracts of carriage are
concerned, some aspects regulated by the Civil Code are those respecting the diligence
required of common carriers with regard to the safety of passengers as well as the
presumption of negligence in cases of death or injury to passengers.

(2) This is also true of petitioner's contention that the jeepney being bumped while it was
improperly parked constitutes caso fortuito. The jeepney was not properly parked, its
rear portion being exposed about two meters from the broad shoulders of the
highway,and facing the middle of the highway in a diagonal angle and that petitioner's
driver took in more passengers than the allowed seating capacity of the jeepney.
Petitioner should have foreseen the danger of parking his jeepney with its
body protruding two meters into the highway.

(3) In this case, there is no legal basis for awarding moral damages since there was no
factual finding by the appellate court that petitioner acted in bad faith in the performance
of the contract of carriage. Sunga's contention that petitioner's admission in open court
that the driver of the jeepney failed to assist her in going to a nearby hospital cannot be
construed as an admission of bad faith. The fact that it was the driver of the Isuzu truck
who took her to the hospital does not imply that petitioner was utterly indifferent to the
plight of his injured passenger. If at all, it is merely implied recognition by Verena that he
was the one at fault for the accident.
CASE DIGESTS IN SALES
By Meralie C. Ebal LLB_DMC

DIGNOS YS. COURT OF APPEALS158 SCRA 378

FACTS:
The spouses Silvestre and Isabel Dignos were. owners of a parcel of land in Opon, Lapu-
Lapu City. OnJune 7, 1965, appellants, herein petitioners Dignos spouses sold the said
parcel of land to respondentAtilano J. 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 andacknowledged by the vendors in the deed of
sale executed in favor of plaintiff-appellant, and the nextinstallment 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, LucianoCabigas and
Jovita L. De Cabigas, who were then U.S. citizens, 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 wasregistered 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 theland, and as plaintiff- appellant discovered the second
sale made by defendants-appellants to the Cabigasspouses, 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 theproperty sold is reserved in the vendor until full payment of the
purchase price, nor is there astipulation giving the vendor the right to unilaterally rescind
the contract the moment the vendeefails 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 uponnon-
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, arepresent, 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 soldin the case at bar, as subject Deed of Sale is a private instrument, it is beyond
question that therewas actual delivery thereof. As found by the trial court, the Dignos
spouses delivered the possessionof the land in question to Jabil as early as March
27,1965 so that the latter constructed thereonSally's Beach Resort also known as Jabil's
Beach Resort in March, 1965; Mactan White Beach Resorton January 15, J 966 and
Bevirlyn's Beach Resort on September 1, 1965. Such facts were admittedby petitioner
spouses.2. No. The contract of sale being absolute in nature is governed by Article 1592
of the Civil Code. It isundisputed that petitioners never notified private respondents Jabil
by notarial act that they wererescinding the contract, and neither did they file a suit in
court to rescind the sale. There is noshowing that Amistad was properly authorized by
Jabil to make such extra-judicial rescission for thelatter who, on the contrary, vigorously
denied having sent Amistad to tell petitioners that he wasalready waiving his rights to the
land in question. Under Article 1358 of the Civil Code, it is requiredthat acts and contracts
which have for their object extinguishment of real rights over immovableproperty must
appear in a public document.Petitioners laid considerable emphasis on the fact that
private respondent Jabil had no money onthe stipulated date of payment on September
15,1965 and was able to raise the necessary amountonly by mid-October 1965. It has
been ruled, however, that where time is not of the essence of theagreement, a slight delay
on the part of one party in the performance of his obligation is not asufficient ground for
the rescission of the agreement. Considering that private respondent has only abalance
of P4,OOO.00 and was delayed in payment only for one month, equity and justice
mandateas in the aforecited case that Jabil be given an additional period within which to
complete paymentof the purchase price.

xxx

NORKIS DISTRIBUTORS, INC. vs. COURT OF APPEALS193

SCRA 694, G.R. No. 91029 February 7,1991

FACTS:
Petitioner Norkis Distributors, Inc. is the distributor of Yamaha motorcycles in Negros
Occidental. OnSeptember 20, 1979, private respondent Alberto Nepales bought trom the
Norkis Bacolod branch abrand new Yamaha Wonderbike motorcycle Model YL2DX. The
price of P7,500.00 was payable bymeans of a Letter of Guaranty from the DBP, which
Norkis agreed to accept. Credit was extended toNepales for the price of the motorcycle
payable by DBP upon release of his motorcycle loan. As securityfor the loan, Nepales
would execute a chattel mortgage on the motorcycle in favor of DBP. Petitionerissued
a sales invoice which Nepales signed in conformity with the terms of the sale. In
themeantime, however, the motorcycle remained in Norkis' possession. On January 22,
1980, themotorcycle was delivered to a certain Julian Nepales, allegedly the agent of
Alberto Nepales. Themotorcycle met an accident on February 3, 1980 at Binalbagan,
Negros Occidental. An investigationconducted by the DBP revealed that the unit was
being driven by a certain ZacariasPayba at the timeof the accident. The unit was a total
wreck was returned.On March 20, 1980, DBP released the proceeds of private
respondent's motorcycle loan to Norkis in thetotal sum of P7,500. As the price of the
motorcycle later increased to P7,828 in March, 1980, Nepalespaid the difference of P328
and demanded the delivery of the motorcycle. When Norkis could not deliver,he filed an
action for specific performance with damages against Norkis in the RTC of Negros
Occidental.He alleged that Norkis failed to deliver the motorcycle which he purchased,
thereby causing himdamages. Norkis answered that the motorcycle had already been
delivered to private respondent beforethe accident, hence, the risk of loss or damage had
to be borne by him as owner of the unit.

ISSUE:
Whether or not there has been a transfer of ownership of the motorcycle to Alberto
Nepales.

HELD:
No.The issuance of a sales invoice does not prove transfer of ownership of the thing sold
to the buyer. Aninvoice is nothing more than a detailed statement of the nature, quantity
and cost of the thing sold andhas been considered not a bill of sale. In all forms of delivery,
it is necessary that the act of deliverywhether constructive or actual, be coupled with the
intention of delivering the thing. The act, without theintention, is insufficient.When the
motorcycle was registered by Norkis in the name of private respondent,Norkis did not
intend yet to transfer the title or ownership to Nepales, but only to facilitate the executionof
a chattel mortgage in favor of the DBP for the release of the buyer's motorcycle loan. The
Letter of Guarantee issued by the DBP reveals that the execution in its favor of a chattel
mortgage over thepurchased vehicle is a pre-requisite for the approval of the buyer's loan.
If Norkis would not accede tothat arrangement, DBP would not approve private
respondent's loan application and, consequently, therewould be no sale.Article 1496 of
the Civil Code which provides that "in the absence of an express assumption of risk by
thebuyer, the things sold remain at seller's risk until the ownership thereof is transferred
to the buyer," isapplicable to this case, for there was neither an actual nor constructive
delivery of the thing sold, hence,the risk of loss should be borne by the seller, Norkis,
which was still the owner and possessor of themotorcycle when it was wrecked. This is
in accordance with the well-known doctrine of res perit domino.

SOUTHERN MOTORS, INC. vs. MOSCOSO

2 SCRA 168G.R. No. L-14475, May 30, 1961

FACTS:
Plaintiff Southern Motors, Inc. sold to defendant Angel Moscoso one Chevrolet truck on
installment basis,for P6,445.00. Upon making a down payment, the defendant executed
a promissory note for the sum of P4,915.00, representing the unpaid balance of the
purchase price to secure the payment of which, achattel mortgage was constituted on the
truck in favor of the plaintiff. Of said account, the defendant hadpaid a total of P550.00,
of which P110.00 was applied to the interest and P400.00 to the principal, thusleaving an
unpaid balance of P4,475.00. The defendant failed to pay 3 installments on the balance
of thepurchase price.Plaintiff filed a complaint against the defendant, to recover the
unpaid balance of the promissory note.Upon plaintiff's petition, a writ of attachment was
issued by the lower court on the properties of thedefendant. Pursuant thereto, the said
Chevrolet truck, and a house and lot belonging to defendant, wereattached by the Sheriff
and said truck was brought to the plaintiff's compound for safe keeping. Afterattachment
and before the trial of the case on the merits, acting upon the plaintiff's motion for
theimmediate sale of the mortgaged truck, the Provincial Sheriff of Iloilo sold the truck at
public auction inwhich plaintiff itself was the only bidder for P1,OOO.OO. The trial court
condemned the defendant to paythe plaintiff the amount of P4,475.00 with interest at the
rate of 12% per annum from August 16, 1957,until fully paid, plus 10% thereof as
attorneys fees and costs. Hence, this appeal by the defendant.

ISSUE:
Whether or not the attachment caused to be levied on the truck and its immediate sale at
public auction,was tantamount to the foreclosure of the chattel mortgage on said truck.

HELD:
No.Article 1484 of the Civil Code provides that in a contract of sale of personal property
the price of which ispayable in installments, the vendor may exercise any of the following
remedies: (I) Exact fulfillment of the obligation, should the vendee fail to pay; (2) Cancel
the sale, should the vendee's failure to pay covertwo or more installments; and (3)
Foreclose the chattel mortgage on the thing sold, if one has beenconstituted, should the
vendee's failure to pay cover two or more installments. In this case, he shall haveno
further action against the purchaser to recover any unpaid balance of the price. Any
agreement to thecontrary shall be void.The plaintiff had chosen the first remedy. The
complaint is an ordinary civil action for recovery of theremaining unpaid balance due on
the promissory note. The plaintiff had not adopted the procedure ormethods outlined by
Sec. 14 of the Chattel Mortgage Law but those prescribed for ordinary civil actions,under
the Rules of Court. Had the plaintiff elected the foreclosure, it would not have instituted
this casein court; it would not have caused the chattel to be attached under Rule 59, and
had it sold at publicauction, in the manner prescribed by Rule 39. That the plaintiff did not
intend to foreclose the mortgagetruck, is further evinced by the fact that it had also
attached the house and lot of the appellant at SanJose, Antique.We perceive nothing
unlawful or irregular in plaintiff's act of attaching the mortgaged truck itself. Sincethe
plaintiff has chosen to exact the fulfillment of the appellant's obligation, it may enforce
execution of the judgment that may be favorably rendered hereon, on all personal and
real properties of the latter notexempt from execution sufficient to satisfy such judgment.
It should be noted that a house and lot at SanJose, Antique were also attached. No one
can successfully contest that the attachment was merely anincident to an ordinary civil
action. The mortgage creditor may recover judgment on the mortgage debtand cause an
execution on the mortgaged property and may cause an attachment to be issued
andlevied on such property, upon beginning his civil action.

xxx

ARTATES YS. URB

I37 SCRA 395, No. L-2942I , January 30, 1971
FACTS:
A homestead patent was issued to appellants Lino Artates and Manuela Pojas on
September 23, 1952. Itwas sold at a public auction to Marcela Soliven by the Provincial
Sheriff of Cagayan to satisfy a judgmentagainst Lino Artates by the Justice of the Peace
of Calanlugan, Cagayan for physical injuries inflicted byhim upon Daniel Urbi on October
21, 1955. The appellants Artates and Pojas alleged that the saleviolated the provision of
Public Land Law exempting said property from execution for any "debtcontracted within
5 years from date of the issuance of the patent.Appellants prayed that the execution sale
of the land to the defendant Urbi, as well as the deed of saleexecuted by the latter in favor
of the defendant Soliven be declared null and void.

ISSUE:
Whether or not 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.
xxx

QUIROGA vs. PARSONS HARDWARE CO.

38 Phil 501, G.R. No. L-11491, August 23, 1918

FACTS:
On January 24, 1911, herein plaintiff-appellant AndressQuiroga and J. Parsons, both
merchants, enteredinto a contract, for the exclusive sale of "Quiroga" Beds in the Visayan
Islands. It was agreed, amongothers, 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. Incompensation 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
thepreference to Mr. Parsons in case anyone should apply for the exclusive agency for
any island notcomprised with the Visayan group; and that, Mr. Parsons may sell, or
establish branches of his agency forthe sale of "Quiroga" beds in all the towns of the
Archipelago where there are no exclusive agents, andshall 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 thebeds at higher prices than those of the
invoices; to have an open establishment in Iloilo; itself to conductthe agency; to keep the
beds on public exhibition, and to pay for the advertisement expenses for thesame; and to
order the beds by the dozen and in no other manner. He alleged that the defendant washis
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 an
agent of theplaintiff for the sale of his beds.

HELD:
No. In order to classify a contract, due regard must be given to its essential clauses. In
the contract inquestion, there was the obligation on the part of the plaintiff to supply the
beds, and, on the part of thedefendant, to pay their price. These features exclude the
legal conception of an agency or order to sellwhereby the mandatory or agent received
the thing to sell it, and does not pay its price, but delivers tothe principal the price he
obtains from the sale of the thing to a third person, and if he does not succeedin selling
it, he returns it. By virtue of the contract between the plaintiff and the defendant, the latter,
onreceiving the beds, was necessarily obliged to pay their price within the term fixed,
without any otherconsideration 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 thecontract, the effect of its breach would only entitle the plaintiff to disregard
the orders which thedefendant might place under other conditions; but if the plaintiff
consents to fill them, he waives his rightand cannot complain for having acted thus at his
own free will.

[ G.R. NO. 121165, September 26, 2006 ]

HON. DOMINADOR F. CARILLO et al VS. HON. COURT OF APPEALS, MARIA PAZ
DABON AND ROSALINA DABON

FACTS: Maria Gonzales alleged that on April 26, 1988, she paid P10,000 to Priscilla as
downpayment on the P400,000 purchase price of the lot with improvements, since
Priscilla had a special power of attorney from her son, Aristotle, the owner of the land.
They also agreed that the balance would be paid within three months after the
execution of the deed of sale. Yet, after the lapse of the period and despite repeated
demands, Priscilla did not execute the deed of sale. Since Priscilla failed to execute the
Deed of Sale, Gonzales filed a case for specific performance and impleaded Priscilla
(not Aristotle). The latter defaulted and judgment was rendered against her ordering the
nullification of the OCT of Aristotle and the issuance of a new certificate of title in favor
of Gonzales. The Dabons thereafter surfaced and sought to annul the judgment of the
trial court asserting that they purchased the property from Aristotle himself and they
were not impleaded as the real parties in interest.

ISSUE: Who has better title to the land, Gonzales or Dabon?

RULING:
DABON. The decision of the lower court in favor of Gonzales was void due to extrinsic
fraud. There is extrinsic fraud when a party has been prevented by fraud or deception
from presenting his case. Fraud is extrinsic where it prevents a party from having a trial
or from presenting his entire case to the court, or where it operates upon matters
pertaining not to the judgment itself but to the manner in which it is procured. The
overriding consideration when extrinsic fraud is alleged is that the fraudulent scheme of
the prevailing litigant prevented a party from having his day in court. Of the indices of
fraud cited by the Court of Appeals, the failure to comply with the notification
requirement in the petition for the cancellation of title amounts to extrinsic fraud. Under
the Property Registration Decree, all parties in interest shall be given notice. There is
nothing in the records that show Gonzales notified the actual occupants or lessees of
the property. Further, the records show that Gonzales had known of the sale of the land
by Aristotle to the Dabons and despite her knowledge, the former did not include the
Dabons in her petition for the annulment of title. Deliberately failing to notify a party
entitled to notice also constitutes extrinsic fraud. This fact is sufficient ground to annul
the order allowing the cancellation of title in the name of Gonzales. The court never
acquired jurisdiction. It must be noted that the property was sold to Gonzales in 1988,
while the same was sold to the Dabons in 1989; nonetheless, the requirements of
double-sale are two-fold: acquisition in good faith and registration in good faith.

SPOUSES PASTOR VALDEZ AND VIRGINIA VALDEZ, PETITIONERS, VS.

HONORABLE COURT OF APPEALS AND FELICIDAD VIERNES, FRANCISCO
ANTE, AND ANTONIO ANTE, RESPONDENTS.

Spouses Francisco Ante and Manuela Ante were the registered owners of a parcel of
land located in Quezon City. Said spouses executed a special power of attorney in
favor of their son, Antonio Ante, a lawyer, authorizing him to execute any document
conveying by way of mortgage or sale a portion or the whole of said property, to receive
payment and dispose of the same as he may deem fit and proper under the
premises. Antonio Ante subdivided the Land into Lot A and B and offered to sell the lots
to Eliseo Viernes, who was occupying the same with the permission of Ante. Viernes,
however, turned down the offer as he did not have money. Antonio Ante, as attorney in
fact, executed a deed of saleof the lot in favor of spouses Pastor Valdez and Virginia
Valdez. The Valdez spouses demanded from Antonio Ante the delivery of the owners
duplicate copy of TCT covering said lot. Ante promised them that he will deliver the title
to them in a few days. In the meanwhile petitioners started fencing the whole lot with
cement hollow blocks in the presence of spouses Eliseo and Felicidad Viernes. On said
occasion the Viernes spouses were informed by the Valdez spouses that they were
fencing the same as they purchased the land from Antonio Ante.

The Valdez spouses registered the two deeds of sale dated June 15, 1980 and
February 12, 1981 with the Register of Deeds of Quezon City by presenting the owners
duplicate copy of the title. They were, however, informed that the said owners
duplicate certificate of title had been declared null and void per order of Judge Tutaan
 dated November 10, 1982. They also found out that spouses Francisco and Manuela
Ante earlier filed a petition for the issuance of a new owners duplicate certificate of title
and to declare null and void the lost owners duplicate certificate of title. The Valdez
spouses also discovered that the Register of Deeds cancelled TCT. No. 141582 and in
lieu thereof issued TCT No. 293889 in the name of Felicidad Viernes on the basis of a
deed of assignment of the same property dated February 17, 1982 executed by Antonio
Ante in her favor.

When Virginia Valdez inquired from Antonio Ante why he executed the said deed of
assignment when he had previously sold the same lot to them, Ante replied that they
could sue him in court. Thus, the Valdezes filed their adverse claim over the lot covered
by TCT No. 293889 in the name of Felicidad Viernes. After trial on the merits before
which the Antes were declared in default, a decision was rendered by the trial court on
April 9, 1986.

Issue:

1. As between plaintiff-spouses Pastor and Virginia Valdez, petitioners in this case and
defendant Felicidad Viernes, one of the private respondents, who is entitled to the
subject lot?

Ruling:

The petition is impressed with merit. Petitioner Spouses Pastor and Virginia Valdez are
entitled to the subject lot.

Article 1544 of the Civil Code provides as follows:

"Art. 1544. If the same thing should have been sold to different vendees, the ownership
shall be transferred to the person who may have first taken possession thereof in good
faith, if it should be movable property.

Should it be immovable property, the ownership shall belong to the person acquiring it
who in good faith first recorded it in the Registry of Property.

Should there be no inscription, the ownership, shall pertain to the person who in good
faith was first in the possession; and, in the absence thereof, to the person who
presents the oldest title provided there is good faith."

From the aforesaid provision of the law, should the subject of the sale be immovable
property, the ownership shall vest in the person acquiring it who in good faith first
recorded it in the registry of property. From the foregoing set of facts there can be no
question that the sale of the subject lot to petitioners was made long before the
execution of the Deed of Assignment of said lot to respondent Viernes and that
petitioners annotated their adverse claim as vendees of the property as early as
September 6, 1982 with the Register of Deeds of Quezon City. On the other hand the
deed of Assignment in favor of Viernes of the said lot was registered with the Register
of Deeds of Quezon City only on November 11, 1982 whereby a new title was issued in
the name of Viernes as above stated.

The rule is clear that a prior right is accorded to the vendee who first recorded his right
in good faith over an immovable property. In this case, the petitioners acquired subject
lot in good faith and for valuable consideration from the Antes and as such owners
petitioners fenced the property taking possession thereof. Thus, when petitioners
annotated their adverse claim in the Register of Deeds of Quezon City they thereby
established a superior right to the property in question as against respondent Viernes.

On the other hand, respondent Viernes cannot claim good faith in the purchase of the
subject lot and the subsequent registration of the Deed of Assignment in her
favor. Even before the petitioners purchased the lot from the Antes respondent Viernes
husband was first given the option to purchase the same by Antonio Ante but he
declined because he had no money and so he was informed that it would be sold to
petitioners. After petitioners purchased the lot they immediately fenced the same with
the knowledge and without objection of respondent Viernes and her husband and they
were informed by the petitioners about their purchase of the same. Moreover, when
petitioners annotated their adverse claim as vendees of the property with the Register of
Deeds of Quezon City, it was effectively a notice to the whole world including
respondent Viernes.

[ G.R. No. 131679, February 01, 2000 ]

CAVITE DEVELOPMENT BANK AND FAR EAST BANK AND TRUST COMPANY,
PETITIONERS, VS. SPOUSES CYRUS LIM AND LOLITA CHAN LIM AND COURT
OF APPEALS, RESPONDENTS.

Facts:
Rodolfo Guansing obtained a loan from Cavite Development Bank(CDB) and offered as
security his real estate property. For failing to pay his loan the property was foreclosed
and title was issued in the name of CDB.
Now here comes Lolita Chan Lim, the respondent on this case who offered to buy the
property from CDB. Mrs. Lim paid P30,000.00 as option money and was issued receipt
by CDB. However , Mrs. Lim later discovered that the title of the property is being
disputed by Perfecto Guansing, the father of the mortgagee Rodolfo Guansing. In fact,
in a separate case it was declared that Rodolfo fraudulently secured title to the said
mortgaged property and title to it was restored to Perfecto . The decision has since
become final and executory.
Aggrieved by what she considered a serious misrepresentation by CDB and its mother
company FEBTC, on their ability to sell the subject property, filed an action for specific
performance and damage against petitioners.
Issues: Was the sale between CDB and Mrs. Lim perfected?
Is CDB liable for damges?
Is the sale valid?
Decision: Contracts are not defined by the parties thereto but by the principles of law. In
determining the nature of a contract, the courts are not bound by the name or title given
to it by the contracting parties. In the case at bar, the sum of P30,000.00, although
denominated in the offer to purchase as option money is actually in the nature
of earnest money or down payment when considered with the other terms of the offer.
It is because when Mrs. Lim offered to buy the property the 10% so called option
money forms part of the purchase price as contemplated under Art. 1482 of the Civil
Code. It is clear then that the parties in this case actually entered into a contract of sale,
partially consummated as to the payment of the price.
CDB cannot invoke the defense that it is a mortgagee in good faith. It only applies to
private individuals and not to banking institutions. They cannot be excused from the
duty of exercising the due diligence required of banking institutions. It is standard
practice for banks, before approving a loan, to investigate who are the real owners
thereof. Banking is affected with public interest that is why they are expected to exercise
more care and prudence than private individuals.
Considering CDBs negligence it is therefore liable for damages.
As to its validity, the doctrine of Nemo dat quod non habet applies. One cannot give
what one does not have. The seller not being the owner the sale is void.

G.R. NO. 124242, January 21, 2005

SAN LORENZO DEVELOPMENT CORPORATION VS. CA

FACTS:
On 20 August 1986, the Spouses Lu purportedly sold the two parcels of land to
respondent Pablo Babasanta. The latter made a downpayment of fifty thousand pesos
(P50,000.00) as evidenced by a memorandum receipt issued by Pacita Lu of the same
date. Several other payments totaling two hundred thousand pesos (P200,000.00) were
made by Babasanta. He demanded the execution of a Final Deed of Sale in his favor so
he may effect full payment of the purchase price; however, the spouses declined to push
through with the sale. They claimed that when he requested for a discount and they
refused, he rescinded the agreement. Thus, Babasanta filed a case for Specific
Performance.
On the other hand, San Lorenzo Development Corporation (SLDC) alleged that on
3 May 1989, the two parcels of land involved, namely Lot 1764-A and 1764-B, had been
sold to it in a Deed of Absolute Sale with Mortgage. It alleged that it was a buyer in good
faith and for value and therefore it had a better right over the property in litigation.
ISSUE:
Who between SLDC and Babasanta has a better right over the two parcels of land?
RULING:
An analysis of the facts obtaining in this case, as well as the evidence presented
by the parties, irresistibly leads to the conclusion that the agreement between Babasanta
and the Spouses Lu is a contract to sell and not a contract of sale.
The receipt signed by Pacita Lu merely states that she accepted the sum of fifty
thousand pesos (P50,000.00) from Babasanta as partial payment of 3.6 hectares of farm
lot. While there is no stipulation that the seller reserves the ownership of the property until
full payment of the price which is a distinguishing feature of a contract to sell, the
subsequent acts of the parties convince us that the Spouses Lu never intended to transfer
ownership to Babasanta except upon full payment of the purchase price.
Babasantas letter dated 22 May 1989 was quite telling. He stated therein that
despite his repeated requests for the execution of the final deed of sale in his favor so
that he could effect full payment of the price, Pacita Lu allegedly refused to do so. In
effect, Babasanta himself recognized that ownership of the property would not be
transferred to him until such time as he shall have effected full payment of the price.
Doubtlessly, the receipt signed by Pacita Lu should legally be considered as a perfected
contract to sell.
The perfected contract to sell imposed upon Babasanta the obligation to pay the
balance of the purchase price. There being an obligation to pay the price, Babasanta
should have made the proper tender of payment and consignation of the price in court as
required by law. Glaringly absent from the records is any indication that Babasanta even
attempted to make the proper consignation of the amounts due, thus, the obligation on
the part of the sellers to convey title never acquired obligatory force.
There was no double sale in this case because the contract in favor of Babasanta
was a mere contract to sell; hence, Art. 1544 is not applicable. There was neither actual
nor constructive delivery as his title is based on a mere receipt. Based on this alone, the
right of SLDC must be preferred.

Nool vs. Court of Appeals

Conchita Nool owned a lot which was mortgaged to DBP when she secured a loan.
Upon non-payment of loan it was foreclosed by DBP. Within the time of redemption
Conchita contacted Anacleto Nool to redeem the foreclosed property which the latter
did. The titles were transferred to Anacleto but it was agreed that Conchita can get back
the property soon when she has money. Conchita asked the Anacleto for the return of
the property but the latter refused even after the intervention of the barangay. The case
was filed.

Anacleto theorized that the lands were acquired by them from DBP through negotiated
sale. He argued that he was made to believe that the property was still owned by
Conchita when they agreed of redemption.

RTC said it was DBP who was the owner of the property when the sale to Anacleto was
made. DBP became the absolute owner of the property after the redemption period of
the foreclosed property had lapsed. RTC denied the action by Conchita. It was affirmed
by CA.

SC: The contract of repurchase entered by Conchita and Anacleto was void there
being no subject to speak of. It is clear that Conchita was no longer the owner of
the property when such agreement was made with Anacleto. It is likewise clear
that the seller can no longer deliver the object of the sale to the buyer, as the
buyer had already acquired the title from the rightful owner. Jurisprudence
teaches us that a person can only sell what he owns or is authorized to sell ; the
buyer can acquire no more that what the seller can legally transfer.

The right to repurchase presupposes a valid contract of sale between the same
parties. CA is decision AFFIRMED. Petition is DENIED.

Peoples Homesite vs. Court of Appeals

Peoples Homesite (PHHC) passd a resolution subject to the approval of the city
council of the Lot 4 as it is hereby awarded to Mendoza. The city council disapproved
the proposal. The Mendozas were notified through registered mail. Another subdivision
plan was passed and was approved by the city council. PHHC passed a resolution
recalling all awards to persons who failed to pay the agreed downpayment. Mendoza
never paid the down payment. The questioned award of lot was withdrawn and was re-
awarded to other 5 persons. Mendoza asked for reconsideration but before it was acted,
He instituted the action.

Trial court sustained the withdrawal while the CA reversed the decision.

SC: There was no perfect sale of Lot 4 to Mendoza. It was conditionally awarded
to Mendoza subject to city councils approval which was disapproved. When after
the city council approved such, Mendoza should have manifested his intention
over the said award but he did not so.

The contract of sale is perfected at the moment there is a meeting of the mind
upon the thing which is the object of the contract and upon the price. In
conditional obligation, the acquisition of rkights, as well as the extinguishment or
loss of those already acquired, shall depend upon the happening of the event
which constitute the condition. In this case, there was no meeting of the minds.

Heirs of Juan San Andres vs. Rodriguez

Juan San Andres sold a portion of his property to Rodriguez as evidenced by a Deed of
Sale. Upon his death Ramon San Andres was appointed as administrator of the
property. He hired a land surveyor and found that Rodriguez enlarged the property he
bought from late Juan. Ramon demanded form the Rodriguez to vacate the portion
allegedly occupied but the latter refused hence the present action.

Rodriguez said that the excess portion was also sold to him by late Juan the following
day after the first sale. He argued that the full payment of the whole sold lot would be
effected within five years from the execution of the formal deed of sale after a survey of
the property is conducted, as evidenced by a receipt of sale. The balance of the
purchase price was consigned.

RTC ruled in favor of petitioner while CA reversed the ruling. In SC petitioner argued
that there is no certain object of the contract of sale as the lot was not described with
sufficiency that there should be another contract to finally ascertain the identity.

SC: Petition has no merit. The contract of sale has the following elements: 1.
consent or meeting of the minds, 2. determinate subject matter, 3. price certain in
money.

There is no dispute that Rodriguez purchased a potion of Lot 1914-B consisting

of 345 square meters. The said portion is located at the middle of the lot. Since
the lot subsequently sold is said to adjoined the previously paid lot, the subject is
capable of being determined without the need of another contract.

However, there is a need to clarify what CA said is a conditional sale. CA

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 5 years from the
execution of the formal deed of sale.

It is evident in the stipulation in the receipt that the vendor late Juan sold the lot
to Rodriguez and undertook the transfer of ownership without any qualification,
reservation or condition.

In can be gainsaid from the facts that the contract of sale is absolute, and not
conditional. There is no reservation of ownership nor stipulation providing for a
unilateral rescission by either party. In fact the sale was consummated upon the
delivery of the lot to Rodriguez. Art.1477 provides that the ownership of the thing
sold shall be transferred to the vendee upon the actual or constructive deliver
thereof.
The stipulation that the payment of the full consideration based on a survey shall
be due and payable in 5 years from the execution of the formal deed of sale is not
a condition which affects the efficacy of contract.
CA decision is AFFIIRMED.

Galang vs. Court of Appeals

Buenaventuras sold to Galangs the property they inherited from their parents. The
agreement was embodied in the Deed of Sale. The agreements as to payment were as
follows: 25% of the purchase price is to be paid upon the signing, 25% within 3 months
or upon the removal of encargo from the premises, with the delivery of the owners
duplicate certificate, 50% is within 1 year upon which the title will be transferred.
Galangs paid the first 25% of the price. Thereafter they demanded the removal of the
encargo and the delivery of the duplicate title. Buenaventuras failed to do so despite the
willingness of Galangs to pay the other 25%. Galangs filed the instant action for specific
performance.

The trial court rescinded the contract despite the prayer of Galang for specific
performance. It ruled that impossible condition, those contrary to good custom or public
policy and those prohibited by law shall annul the obligation which depends upon them.
Since the consummation of sale is dependent upon the ouster of agricultural lessees
which cannot be done because it is against good custom, public policy and the law, the
sale is a nullity. CA affirmed the ruling.

SC: We disagree with the conclusion of the two lower courts. Reviewing the
terms of the Deed of Sale, it is clear that the parties had reached the stage of
perfection of the contract of sale.

The alleged condition precedent, the removal of the encargo, was simply an
alternative for payment of another 25% of the purchase price given by the seller.
Assuming that the removal of encargo could not be brought about by the buyer,
petitioner could have demanded the duplicate of the owners certificate of title by
paying 25% of the sale price within 3 months.

The case before us could have been resolved by the lower court without ruling on
the whether the encargo was a tenant or not. Granting that it was necessary to
rule on the status of the encargo, we find that the courts had been quite
precipitate in holding that the encargi was a tenant. Petition is GRANTED.