Tuatis v. Sps.
Escol o Tuatis chose the second option as the value of
GR 175399 | Oct. 27, 2009 | Chico-Nazario, J.
FACTS
- Visminda Escol sold a portion of his property to Ophelia
Tuatis by a Deed of Sale by Installment. Under their
contract, if Tuatis failed to pay the remaining balance
within the period stipulated, she shall return the property
to Escol and the latter shall return former’s money
- The purchase price was P10k. Tuatis alleged that she
already paid the full purchase price (P3k down payment,
P3k and P1k installments (on diff dates)) and she also gave
P3k for the remaining balance. She also took possession of
the property and constructed a residential building
therein
- Tuatis then requested Escol to sign a prepared absolute
deed of sale, but the latter refused, contending that the
purchase price had not yet been fully paid (she only
received P4k)
- Parties tried to amicably settle before Lupon Barangay but
to no avail
- Thus, Tuatis filed a Complaint for Specific Performance
with damages against Escol before the RTC. She prayed
that RTC order Escol to do all acts for the consummation
of contract, particularly the signing of deed of sale
- In her answer, Escol stated that Tuatis failed to comply
with conditions in the contract and asked RTC to dismiss
Tuatis’ complaint, or in the alternative, order Tuatis to
return subject property after being reimbursed of her
payments
- RTC dismissed Tuatis’ Complaint and ordered her to return
physical possession of subject property to Escol and
ordered the latter to return to Tuatis P4k. Tuatis was not
able to provide sufficient evidence to prove her claim of
full payment. In determining the rights of the parties:
o Tuatis, in constructing the building, was in bad
faith for she knew that Escol was still the absolute
owner of the subject land
o There was also bad faith on Escol’s part in
accordance with Art. 454 since she allowed Tuatis
to construct the building without any opposition
on her part
o The rights of the parties must be determined as
if they both acted in bad faith, in accordance
with Art. 448
- CA dismissed Tuatis’ appeal and the decision became final
and executory. Thereafter, Escol filed a Motion for
Issuance of a Writ of Execution which was granted by RTC
- Tuatis filed before RTC a Motion to Exercise Right under
Art. 448 and asked the Court to allow her to buy the
property. She alleged that she had the right to choose
between being indemnified for the value of residential
building or buying the land from Escol
the land was only P27k where the building was
valued at P502,073
- During the pendency of the motion, the writ of execution
was enforced. Tuatis filed with CA a petition for certiorari,
prohibition and mandamus but the same was denied
- Hence, this petition for certiorari and mandamus. Tuatis
principally argued that Art. 448 must be applied to the
situation between her and Escol
ISSUE
WON Tuatis is entitled to exercise the options granted in Art.
448 of the Civil Code. – NO. Such right was given to Escol
- Under Art. 448, landowner can choose between (1)
appropriating the building by paying the proper indemnity
for the same, as provided for in Arts. 546 and 548; or (2)
obliging the builder to pay the price of the land, unless its
value is considerably more than that of the structures, in
which case the builder in good faith shall pay reasonable
rent
- Under the first option, Escol may appropriate for herself
the building on the subject property after indemnifying
Tuatis for the necessary and useful expenses the latter
incurred for said building, as provided in Art. 546. Until
Escol appropriately indemnifies Tuatis for the building
constructed by the latter, Tuatis may retain possession of
the building and the subject property.
- Under the second option, Escol may choose not to
appropriate the building and, instead, oblige Tuatis to pay
the present or current fair value of the land.
- The P10k price of the subject property, as stated in the
Deed of Sale on Installment shall no longer apply, since
Escol will be obliging Tuatis to pay for the price of the land
in the exercise of Visminda’s rights under Art. 448 CC, and
not under the said Deed
- Tuatis’ obligation will then be statutory, and not
contractual, arising only when Escol has chosen her option
under Art. 448
- Still under the second option, if the present or current
value of the land turns out to be considerably more than
that of the building built thereon, Tuatis cannot be obliged
to pay for the subject property, but she must pay Escol
reasonable rent for the same. Escol and Tuatis must agree
on the terms of the lease; otherwise, the court will fix the
terms
- The Court highlights that the options under Art. 448 are
available to Escol, as the owner of the subject property.
There is no basis for Tuatis’ demand that, since the value
of the building she constructed is considerably higher than
the subject property, she may choose between buying the
subject property from Escol and selling the building to
Escol for P502,073
- Again, the choice of options is for Escol, not Tuatis, to
make. And, depending on Escol’s choice, Tuatis’ rights as
 a builder under Art. 448 are limited to the following: (a) OR), and completely turning a blind eye to the merits of
under the first option, a right to retain the building and the same
subject property until Escol pays proper indemnity; and (b)  SC also noted that RTC, in its decision failed to make an
under the second option, a right not to be obliged to pay adjudication of the rights of the parties under Art. 448.
for the price of the subject property, if it is considerably Decretal part was only limited to implementing deed of
higher than the value of the building, in which case, she sale
can only be obliged to pay reasonable rent for the same  Although RTC decision had already became final and
- The rule that the choice under Art. 448 belongs to the executory, when there is ambiguity caused by omission or
owner of the land is in accord with the principle of mistake in dispositive portion of decision, SC may clarify
accession, i.e., that the accessory follows the principal and such ambiguity by amendment even after judgment has
not the other way around. Even as the option lies with the become final (body of decision v. fallo). Also, if the Court
landowner, the grant to him, nevertheless, is preclusive. does not act upon the petition, Tuatis loses ownership
The landowner cannot refuse to exercise either option over building she constructed without any recompense,
and compel instead the owner of the building to remove while Escol, by returning P4k does not only recover
it from the land property but also gains entire building without paying for
- Purpose of this provision: Where the builder, planter or the same – thus, SC’s decision to give due course to
sower has acted in good faith, a conflict of rights arises petition should not be viewed as a denigration of doctrine
between the owners, and it becomes necessary to protect of immutability of final jugdment but a recognition of the
the owner of the improvements without causing injustice equally sacrosanct doctrine that a person should not be
to the owner of the land. In view of the impracticability of allowed to profit or enrich himself inequitably at
creating a state of forced co-ownership, the law has another's expense
provided a just solution by giving the owner of the land
the option to acquire the improvements after payment of
the proper indemnity, or to oblige the builder or planter
to pay for the land and the sower the proper rent. He
cannot refuse to exercise either option. It is the owner of
the land who is authorized to exercise the option, because
his right is older, and because, by the principle of
accession, he is entitled to the ownership of the accessory
thing.
- Escol’s Motion for Issuance of Writ of Execution cannot be
deemed as an expression of her choice to recover
possession of the subject property under the first option,
since the options under Art. 448 and their respective
consequences were also not clearly presented to her by
Decision of the RTC. She must then be given the
opportunity to make a choice between the options
available to her after being duly informed herein of her
rights and obligations under both.

RULING: RTC decision ordering issuance of writ of execution is

ANNULLED and SET ASIDE. SC directed RTC to conduct further
proceedings to determine (a) facts essential to the proper
application of Art. 448 CC and (b) Escol’s choice of option under
the same provision, and for RTC to further implement such
choice of option.

NOTES
 SC found that CA committed grave abuse of discretion ins
focusing on the procedural deficiencies of Tuatis’ petition
(failed to (i) completely pay docket fees; (ii) attach
certified true or authenticated copy of RTC order; (iii)
indicate the place of issue of her counsel’s IBP and PTR