PILAR DE GUZMAN, ROLANDO GESTUVO, and MINERVA GESTUVO, vs. THE HON.

COURT OF APPEALS, THE

HON. JUDGE PEDRO JL. BAUTISTA, Presiding Judge of the Court of First Instance of Rizal, Branch III, Pasay City,
and LEONIDA P. SINGH.
G.R. No. L-52733; July 23, 1985.
CONCEPCION, JR. J.

Doctrine: Substantial compliance with the terms and conditions of the compromise agreement.

Facts: On February 17, 1971, Pilar De Guzman and Sps. Gestuvo (petitioners) executed a contract to sell with
Leonida Singh covering two parcels of land in Pasay. It was stipulated that Singh should pay the P133,640-balance
on or before February 17, 1975. Two days before Feb. 1975, Singh asked the petitioners to provide the statement of
account of the balance due, copies of certificates of land titles, and power of attorney executed by Rolando Gestuvo
in favor of Pilar De Guzman. However, petitioners refused. Thus, Singh filed a complaint for specific performance
with damages against petitioners in CFI Rizal. Singh alleged that, by refusing to furnish her with copies of the
documents requested, petitioners deliberately intended not to comply with their obligations under the contract to sell,
as a result of which they committed a breach of contract. And they had also acted unfairly and in manifest bad faith
for which they should be held liable for damages. Petitioners claimed that the complaint failed to state a cause of
action; that the balance due was already predetermined in the contract; that they have no obligation to furnish Singh
with copies of the documents requested; and that Singh’s failure to pay the balance on the date specified had caused
the contract to expire and become ineffective without necessity of notice or of any judicial declaration to that effect.
The parties executed a compromise agreement which the Court approved.

On January 28, petitioners filed a motion for the issuance of writ of execution, claiming that Singh failed to abide by
the terms of the compromise agreement. However, the Court denied the petitioners' motion for execution, and
instead directed the petitioners to immediately execute the necessary documents transferring to Singh the title to the
properties. It also ordered the Clerk of Court to release to the petitioners P250,000.00, which had been deposited by
Singh, upon proper receipt therefor.

Petitioners filed a notice of appeal. Singh filed a motion to dismiss the appeal on the grounds that: (1) the orders
appealed from are unappealable; and (2) that the record on appeal is defective as it does not contain the material
data showing that the appeal was perfected on time. The trial court dismissed the appeal of petitioners. As a result,
petitioners filed a petition for certiorari with the Court of Appeals to nullify the order of the trial court which dismissed
their appeal. The CA sustained the decision of the trial court. Hence, the present recourse.

Issue: Whether or not Singh had substantially complied with the terms and conditions of the compromise agreement.

Ruling: Yes. Her failure to deliver to the petitioners the full amount on January 27, 1978 was not her fault. The blame
lies with the petitioners. The record shows that Singh went to the sala of Judge Bautista on the appointed day to
make payment, as agreed upon in their compromise agreement. But, the petitioners were not there to receive it. Only
the petitioners' counsel appeared later, but, he informed Singh that he had no authority to receive and accept
payment. Instead, he invited Singh and her companions to the house of the petitioners to effect payment. But,
petitioners were not there either. They were informed that de Guzman would arrive late in the afternoon, possibly at
around 4:00 o'clock. Singh was assured, however, that she would be informed as soon as the petitioners arrived.
Singh, in her eagerness to settle her obligation, consented and waited for the call which did not come and unwittingly
let the period lapse.
The next day, January 28, 1978, Singh went to the office of the Clerk of CFI of Rizal, Pasay City Branch, to deposit
the balance. But, it being a Saturday, the cashier was not there to receive it. So, on the next working day, Monday,
January 30, 1978, Singh deposited P30,000.00 with the cashier of the Office of the Clerk of the Court of First
Instance of Rizal, Pasay City Branch, to complete the payment of the purchase price of P250,000.00. Since
the deposit of the balance of the purchase price was made in good faith and that the failure of Singh to deposit the
purchase price on the date specified was due to the petitioners who also make no claim that they had sustained
damages because of the two days delay, there was substantial compliance with the terms and conditions of the
compromise agreement.